theScore – Earnings Webcast Q2 F2019 April 17, 2019
All statements other than statements of historical facts included in this presentation may constitute forward-looking information and are based on the best estimates of Management of the current operating environment. These forward-looking statements are related to, but not limited to, theScore’s operations, anticipated financial performance, business prospects and strategies. Forward looking information typically contains statements with words such as ‘‘anticipate’’, ‘‘believe’’, ‘‘expect’’, ‘‘plan’’, ‘‘estimate’’, ‘intend’’, ‘‘will’’, ‘‘may’’, ‘‘should’’ or similar words suggesting future outcomes. These statements reflect current assumptions and expectations regarding future events and operating performance as of the date of February 28, 2019. 2
Q2 F2019 Overview 3
Q2 F2019 Overview • Achieved revenue in Q2 F2019 of $6.8 million versus $7.1 million in Q2 F2018. • Very strong Q1 for the Company was followed by quarter with lower direct sales and industry-wide softness in the programmatic advertising space. • Seeing very good early momentum in Q3 with strong sales in the quarter to date. • Revenue for the first half of F2019 was $16.3 million versus $15.5 million for the same period in F2018. • EBITDA loss in Q2 F2019 was $2.2 million versus a loss of $0.5 million in the same period the previous year. • Increase in EBITDA loss for the quarter primarily the result of increased sports betting-related expenses. 4
Q2 F2019 Overview • Total average monthly active user sessions of theScore mobile app on iOS and Android reached a new Q2 record of 395 million in Q2 F2019. • An average of 97 sessions-per-user-per-month on a base of 4.0 million average monthly app users. • Testament to highly-engaging app experience and our ability to acquire and retain higher quality users. 5
Sports Betting Update • theScore is on schedule to launch mobile sportsbook in mid- 2019 in New Jersey, subject to receiving all required licenses and approvals. • Significant focus in Q2 on product development and set-up of operational infrastructure. • Since sports betting was legalized in New Jersey in mid-June last year, almost $2B has been wagered there, with mobile and online sports betting revenue accounting for four times the amount wagered in retail sportsbooks. (Source: Associated Press, March 2019). • Unique combination of sports media and sports betting will provide a truly differentiated offering. • theScore also supports plans by Ontario government to legalize online gaming in the province, including its call to legalize single-event wagering at the federal level. 6
Product and Content 7
Product and Content • Made further enhancements to theScore’s social features. • Incorporated betting polls into public chat, allowing fans to engage around over/under and moneyline predictions. • Added ability to comment on articles in-app. • Continued to expand our sports betting content and data offering. • Expanded our sports betting tab, which was launched with NFL in Q2, to NBA and NCAA basketball matchup pages. Includes a quick view of odds, lines, and other sports betting-related content at-a-glance. • Focus for Q3 F2019 will be further expansion of betting tab into NHL and MLB sections, as well as adding support for events including Women’s World Cup and Copa America Soccer. • theScore app nominated for a Webby Award in the Best Sports App category. 8
Product and Content • Expanding our sports betting editorial coverage with new hires in advance of launch of sports betting platform. • Enhancing coverage capability in select areas, including combat sports and college sports. • Released new instalment of theScore X video series featuring Austin Rivers; also experimenting with new video content formats. 9
Product and Content • Achieved average monthly reach of ~95 million users during Q2, including a new single month record of ~118 million users in January, propelling theScore to fourth position for top U.S. sports media on social. • Engagement on our social channels is also leading to advertising opportunities there, with recent deals struck with brands including Werner Ladder, Subway, Tim Hortons, and Disney. • theScore’s Instagram account shortlisted for Best Sports Social at The Webby Awards, described as ‘the leading international award honoring excellence on the internet.’ Winners announced April 23 • theScore Instagram was also named as a finalist in the Cynopsis Sports Media Awards for Best Use of Instagram. Winners announced April 25. 10
Product and Content • theScore esports video content continued to demonstrate strong year-over-year growth in Q2 F2019. • Total video views were 39.2 million, up 93% YoY. • Total watch minutes for theScore’s YouTube channel were 260 million, growth of 190% YoY. • Channel subscribers now surpass 700,000. 11
Financials 12
Financials • Revenue for Q2 F2019 was $6.8 million versus $7.1 million for the same period the previous year. Revenue decrease for the quarter was the result of lower direct sales following a very strong Q1 and industry-wide softness in the programmatic advertising space. • Revenue for the first half of F2019 was $16.3 million versus $15.5 million for the same period in F2018. • Seeing very good early momentum in Q3 with strong sales in the quarter to date. • Growth in expenses loosely driven by development of sports betting business. • Finished Q2 F2019 with cash of $8.3 million and $5 million revolving credit facility (undrawn). Q2 F2019 Q2 F2018 Revenue $6,776 $7,099 Operating Expenses $9,754 $8,643 EBITDA $(2,189) $(519) 1H F2019 1H F2018 Revenue $16,251 $15,450 Operating Expenses $19,090 $17,430 EBITDA $(1,222) $14 13
Q&A 14
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