sek m - eniro€¦ · source: iab europe adex benchmark report 2013 1) excluding online directories...
TRANSCRIPT
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Q4 2014
• Total revenue in Q4 was SEK 722 M (952)
October and November impacted negatively by turbulence
• Adjusted EBITDA in Q4 amounted to SEK 160 M (212)
Margin 22.2 % (22.3)
• Reduced loan amortization, SEK 97 M
FY 2014
• Total revenue was SEK 3 002 M (3 588)
• Adjusted EBITDA amounted to SEK 675 M (884)
Margin 22.5% (24.6)
Improved cost savings, SEK 413 M
SEK M
0%
5%
10%
15%
20%
25%
30%
0
100
200
300
400
500
600
700
800
900
Q1 Q2 Q3 Q4
Revenue Adj. EBITDA Adj. EBITDA-margin
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• Launch of new functionality, customer products and improved user experience; mobile navigation app; licensing agreement of local search platform
• Continued traffic growth in Mobile
• Growth in ROI delivered to advertisers
• Customer confidence started to return in December
• Implementing proven sales management model
• Multiscreen 88% of advertising revenues
• Streamlining the business
• Continued focus on costs
4
Weekly average UB:s Eniro Group 2014, 2013
0
5 000 000
7 000 000
9 000 000
3 000 000
1 000 000
6 000 000
2 000 000
4 000 000
8 000 000
2014 2013
Desktop UB Group
Mobile UB Group
• Mobile UB up 36% • Desktop UB down 11%
Source: Adobe Sitecatalyst 1) Total weekly average unique browsers f (UB)
• Total Group UB down 2% • Click on leads increased
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• Amended and extended loan agreement with significantly lower amortization levels
• SEK 450 M fully guaranteed rights issue
• SEK 500 M directed issue of convertible bonds already placed
• Proceeds to repay bank debt and execute strategy
• The loan agreement and transactions are mutually conditional and subject to EGM approval on 9 March, 2015
• The transactions are expected to be completed mid-April
• Together, this will create greater financial flexibility and a stable platform for Eniro’s continued development
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12%
5%
16%
12%
7
• Number one position in local search services in Sweden, Norway, Denmark and Poland
• 90-97% brand recognition in Scandinavia
• 8 million unique visitors every week
• 5 million searchable companies
• More than 19 million searchable products
• Over 250,000 customers
• Approx. 1,300 sales representatives
Source: IAB Europe AdEx Benchmark report 2013 1) Excluding online directories
Digital advertising market1 – Growth per geography 2013
Eniro’s assets
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Further strengthen leading position within Local Search
Build complementary opportunities within Digital Marketing
Manage mature business areas responsibly
Create a superior user experience and provide market-leading ROI advertising solutions, to help customers/SMEs stay visible and relevant in the new advertising landscape
Provide relevant add-on marketing solutions to help customers stay visible and relevant on the globalized market
Maximize earnings from print and voice
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10
5974
867
722
952
Reported REV - Q4
2013
Reported REV - Q4
2014
-145 (-17%)
Voice
29
Print Organic Baseline LY
Desktop
3
Mobile
15
Campaign
-19% 3% -18% -37% 24%
• Total revenues down 24% (organically -17%)
• Multiscreen (Desktop, Mobile and campaign) decreased 11% organically
• Organic baseline affected by :
• Divestments SEK -26 M
• Moved publications SEK -73 M
• Currency effect SEK +15 M
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722
134 160
58 33
134
952
148 212
89 31
207
0
100
200
300
400
500
600
700
800
900
1 000
Revenue EBITDA Adj. EBITDA Change in WC CapEx Operating Cashflow
11
Q4 2013
Q4 2014
SEK M
1) Cash flow from operating activities and cash flow from investing activities excluding company acquisitions/divestments.
1)
Margin:
2014: 22.2%
2013: 22.3%
Margin:
2014: 18.6%
2013: 15.5%
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12
345
109 143
124
-457 (-13%)
Reported REV - Full year 2014
3 002
Voice Campaign
47
Mobile Desktop Organic Baseline LY
3 459
Reported REV - Full year 2013
3 588
-19% 39%
-18% -33% 22%
• Total revenues down 16% (organically -13%)
• Multiscreen (Desktop, Mobile and campaign) decreased 8% organically
• Organic baseline affected by :
• Divestments SEK -74 M
• Moved publications SEK -87 M
• Currency effect SEK +32 M
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13
238
69
7656
95
Divested
32
YTD 2013
2 828
Operating cost 2014
YTD
2 296
Net savings Q4
16
Net Savings Q3
30 7
Net Savings Q2
12
Net Savings Q1
Organic baseline YTD 13
2 2 805
2 710
Currency effect
3rd Party cost Cost excl 3rd party
132
2428
• Total cost savings in Q4 of SEK 238 M, primarily due to reduced staffing
• Total cost savings for YTD amounted to SEK 413 M
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3002
631 675
-139 137 151
3588
777 884
-91 152
329
-500
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
Revenue EBITDA Adj. EBITDA Change in WC CapEx Operating Cashflow
14
SEK M
1) Cash flow from operating activities and cash flow from investing activities excluding company acquisitions/divestments.
1)
FY 2013
FY 2014
EBITDA in 2015 expected to be in line with 2014 level
Margin:
2014: 22.5%
2013: 24.6%
Margin:
2014: 21.0%
2013: 21.7%
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Development net debt/EBITDA RTM
0,0
0,5
1,0
1,5
2,0
2,5
3,0
3,5
4,0
0
500
1 000
1 500
2 000
2 500
3 000
3 500
4 000
2012 2013 Q1 2014 Q2 2014 Q3 2014 Q4 2014
Net Debt EBITDA Net debt/EBITDA
15
• In Q4: Amortization of SEK 97 M instead of SEK 187 M
• Net debt/EBITDA 3.5 (3.0)
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• Agreement to amend and extend loan agreement with significantly lower amortization levels
• SEK 458 M fully guaranteed rights issue
• SEK 475 M (nominal SEK 500 M) directed issue of convertible bonds already placed
• Proceeds to repay bank debt and execute strategy
• The rights issue and the convertible bond issue are subject to EGM approval on 9 March 2015
• The amended loan agreement is subject to successful closing of the rights issue and the convertible bond issue
• The transactions are expected to be completed mid-April
• Together, this will create greater financial flexibility and a stable platform for Eniro’s continued development
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Amended and extended loan agreement creating headroom going forward
• Facility extended to 2018
• Two term loan facilities (SEK 1,100 M and SEK 600 M, respectively) and one revolving facility (SEK 150 M)
• Improved repayment schedule
2015: SEK 150 M (down from SEK 375 M annually)
2016-18: SEK 175 M annually
18
• Covenants as in previous agreements
Interest coverage
Cash flow coverage
Leverage covenant (changed from net debt /EBITDA to senior net debt / EBITDA)
• The interest margins are initially 4.00 percent for the main term loan facility (SEK 1,100 M), 5.00 percent for the second term loan facility and 4.00 percent for the revolving facility
• The amended agreement is conditional upon completion of the rights issue and the directed convertible bond issue
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Terms and conditions – rights issue and directed convertible bond
Rights issue
• SEK 458 M rights issue with preferential rights for existing shareholders
• Supported by main shareholders and fully underwritten by external guarantors as well as existing shareholders
• One (1) existing ordinary share entitles the shareholders to three (3) subscription rights. One (1) subscription right entitles to subscription of one (1) new ordinary share
• Discount to TERP of 46% based on closing share price 5 February 2015 and 41% based on 15 day VWAP
• Dilution impact for shareholders of 75% − 3:1 issue ratio
• Subscription price: SEK 1.50
• Subscription period 16 March – 30 March 2015
Directed issue of convertible bond
• SEK 475 M (nominal SEK 500 M) directed issue of convertible bonds
• Convertible bonds due in April 2020
• Placed with institutional and qualified investors
• Coupon of 6% paid semi-annually
• Conversion premium set to 30% above the subscription price in the rights issue, i. e. the conversion price is SEK 1.95
• Dilution for shareholders at full conversion of 39%
• The convertible bond is subject to current bank facilities and the amended loan agreement not being terminated and the completion of the rights issue
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1,797
2,480
458225
0
500
1,000
1,500
2,000
2,500
3,000
Equity Q4 2014 Rights issue Convertiblebond (option
value)
Pro formaequity post
issues
2,208
1,275
-458
-475
0
500
1,000
1,500
2,000
2,500
Net senior bankdebt Q4 2014
Rights issue Convertiblebond
Pro forma netsenior bank
debt post issues
Preliminary pro-forma debt structure pre transaction costs subject to IFRS accounting and auditing
Please note that the indicative pro forma numbers are based on a set of assumptions on the IFRS accounting of the convertible bond (equity and debt distribution) that may differ when included in the company financials or upon auditing. The assumptions used in the above table implies that approximately 50% of the convertible bond will be considered as equity and 50% will be considered as debt. The effect from the convertible bond being issued at 95% of the nominal amount has been adjusted for in the equity value
Transaction effect on company equity Transaction effect on company net senior bank debt1
SEK M SEK M 3.5x
2.0x
x = Net senior bank debt / reported EBITDA 2014
1) Net senior bank debt derived from company accounts: Borrowings (SEK 2,392 M) – Other current interest-bearing receivables (SEK 3 M) - Other non-current interest-bearing receivables (SEK 123 M) - Cash and cash equivalents (SEK 58 M) 2) Convertible bonds issued 95 percent of the nominal amount
2
2
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Time table of equity rights issue and convertible bonds 2015
21
February March April
Feb, 6 • Announcement of
underwritten rights issue and placing of convertible bond
• Notice to attend EGM
4 weeks notice to EGM
Mar, 9 • EGM
Mar, 13 • Publishing prospectus
Mar, 30 • End of
subscription period
Subscription period
Apr, 2 • Preliminary result
for rights issue available
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