Company Presentation August 2016 Confidential
SAFE HARBOR This presentation contains historical information and forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995 with respect to the business, financial condition and results of operations of Perion. The words “ will ” , “ believe, ” “ expect, ” “ intend, ” “ plan, ” “ should ” and similar expressions are intended to identify forward-looking statements. Such statements reflect the current views, assumptions and expectations of Perion with respect to future events and are subject to risks and uncertainties. Many factors could cause the actual results, performance or achievements of Perion to be materially different from any future results, performance or achievements that may be expressed or implied by such forward-looking statements, or financial information, including, among others, the failure to realize the anticipated benefits of companies and businesses we acquired and may acquirein the future, risks entailed in integrating the companies and businesses we acquire, including employee retention and customer acceptance; the risk that suchtransactions will divert management and other resources from the ongoing operations of the business or otherwise disrupt the conduct of those businesses,potential litigation associated with such transactions, and general risks associated with the business of Perion including intense and frequent changes in the markets in which the businesses operate and in general economic and business conditions, loss of key customers, unpredictable sales cycles, competitive pressures, market acceptance of new products, inability to meet efficiency and cost reduction objectives, changes in business strategy and various other factors,whether referenced or not referenced in this presentation . Various other risks and uncertainties may affect Perion and its results of operations, as described in reports filed by the Company with the Securities and Exchange Commission from time to time, including its annual report on Form 20-F for the year ended December 31, 2014 filed with the SEC on April 16, 2015. Perion does not assume any obligation to update these forward-looking statements.. NON-GAAP MEASURES Non-GAAP financial measures, including adjusted EBITDA, consist of GAAP financial measures adjusted to exclude acquisition related expenses, other non-recurring expenses, share-based compensation expenses, accretion and gain from the reversal of acquisition related contingent consideration, impairment of goodwill, amortization and impairment of acquired intangible assets and the related taxes thereon, as well as certain accounting entries under the business combination accounting rules that require us to recognize a legal performance obligation related to revenue arrangements of an acquired entity based on its fair value at the date of acquisition. The purpose of such adjustments is to give an indication of our performance exclusive of non-cash charges and other items that are considered by management to be outside of our core operating results. These non-GAAP measures are among the primary factors management usesin planning for and forecasting future periods. Furthermore, the non-GAAP measures are regularly used internally to understand, manage and evaluate our business and make operating decisions, and we believe that they are useful to investors as a consistent and comparable measure of the ongoing performance of our business. However, our non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP measures, and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Additionally, these non-GAAP financial measures may differ materially from the non-GAAP financial measures used by other companies. Confidential
Investment highlights 2016 Expected Q 2‘ 1 6 Revenue Q2 ’ 16 EBITDA EBITDA Margin 1 4 % $ 78 M $ 10.8 M 1. Current market leader, with scale Complete solutions for advertisers & publishers: 2. Profitable for 10+ years 3. Poised to take advantage of multiple industry Outstanding Superior growth drivers Creative Formats Execution 4. Strong partnerships with: Exclusive Data-driven Inventory Technology Enhanced Programmatic 5. Seasoned and successful management team Engagement Buying at Scale Confidential
Perion is a Global Leader in Two Major Categories 01 02 intent-based high-impact solutions for brand advertising publishers Confidential
01 Leader in intent-based solutions for publishers Confidential Confidential
Syndicating intent-based search & driving incremental revenue to publishers Drive traffic to search providers & increase their market share Search Monetize publishers ’ Publishers providers products Confidential
Number 2 reseller of intent-based Search, with high profitability Perion has reacted quickly to market dynamics achieving stability and marginal growth Competitors market share (%), Q1 2016 • Strong management and focused strategy • Solid long-term partnerships Blucora • Complies with all market regulations (infospace) 14% Perion Search monetization revenue ($M) 17% 45.5 43.1 43. 42.9 40.8 40.5 IAC 69% Q1/15 Q2/15 Q3/15 Q4/15 Q1/16 Q2/16 Source: companies publications, Perion analysis Confidential
The intent-based business is built upon strong assets What makes CodeFuel a strong industry player? Strong Intent know-how Proprietary partnerships & big data technology Long term partnerships with Bing, Wide search data enables Innovative tech teams & infrastructure Yahoo & Google provide scalable performance (RPM) optimization gives search know-how backed by vast demand inventory, specific to & user intent extraction experience in monetizing client assets intent key-words & category Confidential
A complete solution for content publishers Focusing on end-user preferences, based on ongoing user feedback 01 02 03 Customized native formats Intent-based Balancing engagement & for superior UX monetization Confidential
Customized native formats In-Image In-Tag In-Search In-Video In-Feed Confidential
Identifying user intent and balancing monetization & engagement Using top proprietary technologies Identify Balance monetization user intent & engagement BIG DATA from 10m searches a day KW ranking based on machine-learning engine Page screening w/ smart tag algorithm Optimize for best RPM based on predictive CTR Added data signals Programmatic demand delivery Advertiser Publishers Real time delivery of ads Dashboard that tracks performance Non-human traffic detection Confidential
02 Leader in high-impact brand advertising Confidential
CAPTURING Average Attention See 7000 Marketing Span of 7 Seconds Messages a Day. CONSUMER ATTENTION IS DIFFICULT 3.3 Devices on Average. Millennials Have 4 Source: Forrester Research, "The State of Consumers and Technology Benchmark 2014 US" as cited in company blog, Jan 16, 2015 Confidential
WE HELP BRANDS Confidential
With high-impact ads that deliver results DRIVES ACTION BRAND RECALL 153% 50X CTR Versus Standard Display Greater Ad Recall EARNED MEDIA LIKEABILITY 61% 46% Higher Overall More Likely To Share Via Likeability Social Networks Sources: High Impact Advertising Across Screen: An Undertone & Ipsos Joint Research Project, 4/15; Nielsen “ The New Digital Consumer ” 2/14 Confidential
Driving Intent For A Luxury Auto Brand Results: Campaign Objective +200 % Build awareness for new, more affordable luxury car model and to engage affluent men, taking over sales from luxury competitors. Lift In Purchase Intent Among Men A35+ Exposed To Page Grabber Tactics +45 % Creative: Page Grabber Targeting: M35-64; HHI $220K, Investable Assets $500K+, Luxury Car Owners or In- Lift In Aided Brand Market for Luxury Car; Auto, Business, Tech, Awareness among M35-64 Sports, Luxury Channel targeting. Confidential Source: Millward Brown
Engaging Consumers With Store Locators of a Beauty Brand Results: Campaign Objectives 17.5 % Map Completion Increase awareness of a cosmetics Rate company promotional offer among beauty-conscious women & drive in-store traffic with store locator Greater Map 285 % functionality. Completions Than Benchmark Tactics Interaction Rate 82.3 % Creative: Expandable Half Page Rich With The Product media Mobile w/ in-unit store locator. Carousel Targeting: W25-54, BT to frequent luxury 25x Higher Carousel department store shoppers, Purchased- Interaction Rate than based targeting (Offline Beauty buyers) CPG benchmark Confidential Source: Spongecell FY13 Benchmarks
Increase Consumer Loyalty and Drive Offline Sales for a Coffee Chain Results: Campaign Objective Increase in-store sales during Holiday +$5.91 Season among potential brand “ switchers ” and establish the coffee chain as the holiday destination for In Incremental Sales for consumer coffee needs. every $1.00 Spent on Undertone media Tactics Creative: Page Grabber, In-Stream Video, Half Page 300x600 98.0 % Targeting: Demo to A18-34, Behavioral targeting to Family Oriented, Coffee of brand ’ s incremental sales during Holiday driven by Shop Visitors (Holiday), Gifters, Indulgent Undertone ads Seasonal Drink Buyers Confidential Source: Nielsen NBI Study
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