Analysts’ Presentation Results FY 2014 May 26, 2015 Minds + Machines Group Limited ( MMX ) 1
Disclaimer The following is a presentation (the “Presentation”) relating to Minds + Machines Limited (“MMX”). The Presentation is being communicated by MMX. It is confidential. Recipients may not provide, or otherwise make available, this Presentation to any person whatsoever and no part of it may be reproduced in any manner without the written permission of TLDH. The information in the Presentation is subject to updating, revision and amendment. The Presentation does not constitute or form part of any offer or invitation to sell or any solicitation of any offer to purchase or subscribe for any shares in MMX. No reliance may be placed for any purpose whatsoever on the information contained in the Presentation or any assumptions made as to its completeness. � No representation or warranty expressed or implied is given by MMX or any of their officers, employees or agents as to the accuracy of the information or opinions contained in the Presentation and no liability is accepted for any such information or opinions (which should not be relied upon) or for any loss howsoever arising directly or indirectly from any use of the Presentation or its contents. The actual results, performance or achievements of MMX may be materially different from the future results, performance or achievements expressed or implied by any opinions, estimates and projections included in the Presentation. This Presentation is exempt from the general restriction on communications contained in section 21 of the Financial Services and Markets Act 2000 (“FSMA”) on the grounds that it is being provided only to persons of a kind described in Regulation 19 (being persons with professional experience in matters relating to investments), Regulation 48 (being a certified high net worth individual), Regulation 49 (being high net worth companies, trustees of high net worth trusts or unincorporated associations), Regulation 50 (being a sophisticated investor) or Regulation 50A (being a self-certified sophisticated investor) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (the “Financial Promotion Order”) or to persons who are otherwise permitted by law to receive it. � Any recipient of this Presentation who does not fall within Regulations 19, 48, 49, 50 or 50A of the Financial Promotion Order or as described above; or to whom distribution is otherwise not lawful may not rely on it, and should return the Presentation to MMX immediately. Neither any company nor any person involved in the preparation of the Presentation owes a duty of care to any person or any recipient. Each person or company must undertake such investigations as they see fit before entering into any contract of any kind. If you are in any doubt as to what action to take, you are recommended to seek your own financial advice from your stockbroker, bank manager, solicitor, accountant or other independent financial adviser authorized under the FSMA immediately. 2
Industry Overview 3
What’s a Domain Name? 4
What Does the Industry Look Like? Registry Supply RSP Registry Service Provider Registrar Distribution End Users 5
Where Minds + Machines Operates Registry Supply RSP Registry Service Provider Registrar Distribution End Users 6
Business Overview 7
Minds + Machines Operations Registry Wholly/majority owns TLDs • Wholesaler of domains to registrars • Supply RSP Provides the infrastructure services for registries • Manages company owned TLDs/cost center for registry • Registry Service Derives revenue from client owned TLDs • Provider In-house distribution channel for MMX owned/operated TLDs Registrar • Enables a ffi liates for key verticals • Distribution Delivers higher margin for MMX’s premium domain names • Premium High margin product line • Names Tens of thousands of premium names in inventory per TLD • 8
Portfolio 15 Verticals 5 GEOs 4 Generic 5 Restricted 5 Clients 34 Total 10 additional TLDs remain contested 9
2014 Highlights 10
Operational Highlights – 2014 Registry Auctions • Participated in 26 private auctions • Acquired 6 TLDs • Cash Receipts of USD$37.5m • Launched 9 TLDs beginning September 2014 • Built distribution channel with all major registrars, including GoDaddy, • Host Europe, Tucows, eNom, and 1&1 Generated premium domain name portfolio for each TLD • Tens of thousands in inventory per TLD • RSP Launched 3 TLDs • .london, .kiwi, and .gop • Enhanced infrastructure to secure future registry clients • Registrar Built registrar platform • Created a ffi liate distribution channel • Established baseline marketing analytics • Created distribution channel for MMX • Accounted for 11% of registrations for MMX owned/operated TLDs • Over 108,000 total domain name registrations generating USD$5m in gross sales from September - December 2014. Total current registrations stand at over 177,000. 11
Financial Highlights – 2014 2014 Financial Highlights Percentage FY 2014 FY 2013 change $’000 $’000 Cash revenue (1) 5,028 56 7679% Of which accounted for as revenue (4) 1,922 56 3332% Administrative expenses (13,477) (5,189) 160% Royalties/guaranteed revenue payments (6) (3,574) - N/A Total profit (4) 22,059 1,214 1717% Intangible assets (4) 40,597 2,560 1486% Other Long Term Assets (4) 5,982 14,350 -58% Cash & Cash Equivalents (4) 45,796 14,884 208% Net Assets (4) 94,685 39,294 298% Basic earnings per share (4) 2.73 cents 0.21 cents 1202% Diluted earnings per share (4) 2.67 cents 0.20 cents 1236% (1) Cash sales refer to total sales generated during the year (not deferred for accounting purposes). (2) Year ended 31 December 2014 (3) Year ended 31 December 2013 (4) As stated in the financial statements (5) The Company’s reporting currency has been changed to USD and results have been restated accordingly (6) Includes $3,297 prepaid expenses from a prior period which were previously reflected as current assets $5M cash revenue over fi nal 4 months of year $37.5M in cash receipts from private auctions $13.5M costs/investment into building out business lines and operating company $22.1M total pro fi t - relates primarily to one-o ff private auction proceeds 12
Financial Highlights – 2014 Cash Cash In ($42.5 million) Private Auctions - One o ff ($37.5 million) Cash Revenue ($5 million) Cash Out ($43.1 million) Investment: gTLDs acquired (61%) Operating expenses (31%) Cost of Sales (8%) 13
Outlook 14
Revenue Growth & Measuring Progress Top Line Revenue Growth New gTLD Industry Growth Vertical Integration • Premium names • Dedicated Sales Team • Pricing Tiers • Contention Resolution • 10 contended applications • Volume Growth • Standard names growth • Launching more gTLDs • Measuring Progress KPIs • Source: ntldstats.com 15
Vertical Integration M+M gTLD Registry Sits on MMX RSP Platform Supply Registrar Distribution Resellers & Resellers A ffi liates A ffi liates Consumers 16
Premium Names Today’s .com prices MMX Pricing Tiers fantasyfashion.com USD$75,000 Tier 1 = $50 pa lingeriefashion.com EUR € 50,000 Tier 2 = $100 pa ladiesfashion.com USD$50,000 � Tier 3 = $250 pa fitfit.com USD$66,000 247fit.com USD$65,000 Tier 4 = $500 pa workfit.com USD$54,000 � Tier 5 = $1,000 pa accommodationlondon.com USD$100,000 propertylondon.com USD$95,000 Tier 6 = $2,500 pa hotelinlondon.com USD$55,000 � Tier 7 = $5,000 pa modernlaw.com USD$120,000 Tier 8 = Call Us 365law.com USD$50,000 marijuanalaw.com USD$29,000 Tens of thousands of premium names in inventory per TLD Source: www.sedo.com 17
Contention Resolution .art .eco .hotel .cpa .gay .inc .data .home .llc .music 18
Volume Growth Minimum 10 new TLDs launching 2015 – 2016 Continue existing segmented strategy for standard names: Geo • Generic • Verticals • Market penetration: pioneers, resellers, and affiliates 19
Measuring Progress KPIs 2014 Target 2015-16 Domains under management 108,000 3 - 5% of total new gTLD registrations � � Premium names sales growth Total Premium names sold pa 6,000 1.75 - 2.5x growth each year Avg. revenue per Premium name $184 $200 - $225 � � Standard names sales growth Total standard names sold pa 102,000 1.50 - 2x growth each year Avg. revenue per standard name $28 $15 - $22 Average life per domain name - 2.25 - 4.0 years per name (Based on industry released renewal rate range of 55% to 72%) � � � To be covered by cash revenues on month-to-month basis in 2016 Operating Expenditures ($13.5m)* *does not include royalties and revenue guarantees for certain TLDs 20
Three-year Outlook 2015 Continue transition from investment to operations • – Launch next 10 TLDs during 2015 - 2016 – Build out reseller and affiliate networks by vertical – Build out premium name sales teams 2016 Fully transition to operations • Take advantage of scalable infrastructure • 2017 Industry consolidation • Second round of new gTLDs? • 21
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