Cxense ASA Q1 2015 presentation 13 May 2015 Important notice THIS - PowerPoint PPT Presentation

Cxense ASA Q1 2015 presentation 13 May 2015

Important notice THIS PRESENTATION AND ITS ENCLOSURES AND APPENDICES (HEREINAFTER JOINTLY REFERRED TO AS THE “PRESENTATION”) HAVE BEEN PREPARED BY CXENSE ASA (THE”COMPANY”) EXCLUSIVELY FOR INFORMATION PURPOSES. THIS PRESENTATION HAS NOT BEEN REVIEWED OR REGISTERED WITH ANY PUBLIC AUTHORITY OR STOCK EXCHANGE. RECIPIENTS OF THIS PRESENTATION MAY NOT REPRODUCE, REDISTRIBUTE OR PASS ON, IN WHOLE OR IN PART, THE PRESENTATION TO ANY OTHER PERSON. THE CONTENTS OF THIS PRESENTATION ARE NOT TO BE CONSTRUED AS LEGAL, BUSINESS, INVESTMENT OR TAX ADVICE. EACH RECIPIENT SHOULD CONSULT WITH ITS OWN LEGAL, BUSINESS, INVESTMENT AND TAX ADVISER AS TO LEGAL, BUSINESS, INVESTMENT AND TAX ADVICE. THERE MAY HAVE BEEN CHANGES IN MATTERS, WHICH AFFECT THE COMPANY SUBSEQUENT TO THE DATE OF THIS PRESENTATION. NEITHER THE ISSUE NOR DELIVERY OF THIS PRESENTATION SHALL UNDER ANY CIRCUMSTANCE CREATE ANY IMPLICATION THAT THE INFORMATION CONTAINED HEREIN IS CORRECT AS OF ANY TIME SUBSEQUENT TO THE DATE HEREOF OR THAT THE AFFAIRS OF THE COMPANY HAVE NOT SINCE CHANGED, AND THE COMPANY DOES NOT INTEND, AND DOES NOT ASSUME ANY OBLIGATION, TO UPDATE OR CORRECT ANY INFORMATION INCLUDED IN THIS PRESENTATION. THIS PRESENTATION INCLUDES AND IS BASED ON, AMONG OTHER THINGS, FORWARD-LOOKING INFORMATION AND STATEMENTS. SUCH FORWARD-LOOKING INFORMATION AND STATEMENTS ARE BASED ON THE CURRENT EXPECTATIONS, ESTIMATES AND PROJECTIONS OF THE COMPANY OR ASSUMPTIONS BASED ON INFORMATION AVAILABLE TO THE COMPANY. SUCH FORWARD-LOOKING INFORMATION AND STATEMENTS REFLECT CURRENT VIEWS WITH RESPECT TO FUTURE EVENTS AND ARE SUBJECT TO RISKS, UNCERTAINTIES AND ASSUMPTIONS. THE COMPANY CANNOT GIVE ANY ASSURANCE AS TO THE CORRECTNESS OF SUCH INFORMATION AND STATEMENTS. AN INVESTMENT IN THE COMPANY INVOLVES RISK, AND SEVERAL FACTORS COULD CAUSE THE ACTUAL RESULTS, PERFORMANCE OR ACHIEVEMENTS OF THE COMPANY TO BE MATERIALLY DIFFERENT FROM ANY FUTURE RESULTS, PERFORMANCE OR ACHIEVEMENTS THAT MAY BE EXPRESSED OR IMPLIED BY STATEMENTS AND INFORMATION IN THIS PRESENTATION, INCLUDING, AMONG OTHERS, RISKS OR UNCERTAINTIES ASSOCIATED WITH THE COMPANY’S BUSINESS, SEGMENTS, DEVELOPMENT, GROWTH MANAGEMENT, FINANCING, MARKET ACCEPTANCE AND RELATIONS WITH CUSTOMERS, AND, MORE GENERALLY, GENERAL ECONOMIC AND BUSINESS CONDITIONS, CHANGES IN DOMESTIC AND FOREIGN LAWS AND REGULATIONS, TAXES, CHANGES IN COMPETITION AND PRICING ENVIRONMENTS, FLUCTUATIONS IN CURRENCY EXCHANGE RATES AND INTEREST RATES AND OTHER FACTORS. SHOULD ONE OR MORE OF THESE RISKS OR UNCERTAINTIES MATERIALISE, OR SHOULD UNDERLYING ASSUMPTIONS PROVE INCORRECT, ACTUAL RESULTS MAY VARY MATERIALLY FROM THOSE DESCRIBED IN THIS DOCUMENT. THE COMPANY DOES NOT INTEND, AND DOES NOT ASSUME ANY OBLIGATION, TO UPDATE OR CORRECT THE INFORMATION INCLUDED IN THIS PRESENTATION. THIS PRESENTATION IS SUBJECT TO NORWEGIAN LAW, AND ANY DISPUTE ARISING IN RESPECT OF THIS PRESENTATION IS SUBJECT TO THE EXCLUSIVE JURISDICTION OF NORWEGIAN COURTS 2

Cxense at a glance We enable businesses to understand, engage and We enable businesses to understand, engage and Adopted by global media leaders Adopted by global media leaders monetize their audience monetize their audience • • Real-time user tracking and profile building regardless of Real-time user tracking and profile building regardless of whether the users access the sites via mobile, tablet or whether the users access the sites via mobile, tablet or desktop desktop • • Individually tailored web content and advertisements Individually tailored web content and advertisements create unique user experiences create unique user experiences • • Proprietary «big data» management software Proprietary «big data» management software Attractive outlook and leading position Attractive outlook and leading position SaaS revenues and gross margin SaaS revenues and gross margin • • Increasing focus on user-targeted marketing Increasing focus on user-targeted marketing 4 000 90% • • Still in early stages of adoption Still in early stages of adoption 3 000 80% USD 1 000 2 000 70% Long-term client relationships Long-term client relationships • • Attractive business model Attractive business model 1 000 60% 0 50% 4Q12 1Q13 2Q13 3Q13 4Q13* 1Q14 2Q14 3Q14 4Q14 1Q15 Revenues Gross margin * Emediate included in revenues from 4Q13 3

SaaS is the business model for the future Predictable high-growth revenue stream Predictable high-growth revenue stream Estimated annualized revenue from SaaS backlog at qtr. end Estimated annualized revenue from SaaS backlog at qtr. end   The “SaaS” (software as -a-service) revenue model The “SaaS” (software as -a-service) revenue model 19 18 provides revenue visibility provides revenue visibility 17   12-24 month contract durations and auto renewal 12-24 month contract durations and auto renewal 16 USDm 15 14 13 Unique technology with infinite scalability and real- Unique technology with infinite scalability and real- 12 time accessibility time accessibility 11 10   The Cxense data engine is a core part of our clients’ The Cxense data engine is a core part of our clients’ 2Q14 3Q14 4Q14 1Q15 internet offering internet offering   More than half a billion user profiles maintained across More than half a billion user profiles maintained across Number of new contracts signed Number of new contracts signed more than 5 000 internet sites more than 5 000 internet sites 40 35 Robust growth in several geographical markets and Robust growth in several geographical markets and 30 verticals verticals 25 20   Powering premium publishers and E-commerce Powering premium publishers and E-commerce 15 companies companies 10   5 The enterprise market has untapped potential The enterprise market has untapped potential 0   Market penetration accelerated with recent Market penetration accelerated with recent 1Q13 2Q13 3Q13 4Q13 1Q14 2Q14 3Q14 4Q14 1Q15 strengthening of sales team strengthening of sales team 4

Agenda Highlights Operational review Financial review Technology update 5

Selected highlights Q1 2015  31 new contracts signed in the quarter, an increase of 72% compared to Q1 2014  Record new recurring license revenue of USD 0.45m in the quarter with an annualized effect of USD 1.8m.  The Cxense DMP is continuing to drive revenue growth  Premium publishers have historically represented the main client segment, but Cxense is continuing its move into new verticals such as Bank and Finance and Branded Consumer Goods  Currency adjusted revenue for the consolidated business was USD 4.4m in Q1 2015.  The churn in the quarter was USD 0.42, above the average churn rate in 2014. The main reason is loss of clients in the acquired base. We expect the churn to be back to normalized levels in Q2 2015  The SaaS segment EBITDA was USD -1.5m in the quarter compared to USD -1.8m in Q1 2014 and USD -3.5m in Q4 2014  The gross margin was 84%, the same level as Q4 2014  Following the Q1 2015 private placement and subsequent offering, the company had a cash position of USD 8.3 million by end of the quarter 6

Agenda Highlights Operational review Financial review Technology update 7

Selected contracts in Q1 2015 EMEA Swedish Publisher EMEA Spanish Publisher Japan Japanese Publisher North America Reseller/Partner Latin America Broadcaster in South America 8

Strong momentum in new contracts and new recurring revenue  31 new contracts signed in the quarter. Slightly down from the record level in Q4 2014, but significantly above the average level for 2014, and a 71% increase compared to Q1 2014  The new recurring revenue is mainly from our DMP offering, where as last year it was mainly ad serving software  2015 new recurring revenue will continue to be dominated by the DMP offering  Cxense ASA has experienced an increasing number of invitations to RFP ´ s in North America and EMEA, both within publishing but also within the enterprise market  We are also experiencing also an increase in the number of companies approaching us for partner agreements 9

Business as usual for portfolio Quarterly churn in USD  We experienced higher churn in Q1 2015 – one lost contract represent a large part of total churn in Q1  The churn is from our acquired customer base (Q4 2013)  We expect the churn, in percentage of client base, to be the same for 2015 as for 2014 10

The sales model is working High End sales Regional Sales Online sales ”The Elephant Hunters” The five sales regions Cxense.com 5 20 2 Serving the largest clients world wide Professionals with local knowledge New self service offering on Cxense.com within its sector performing sales in a region The number of sales people from 20 to 27 11

Agenda Highlights Operational review Financial review Technology update 12

USD appreciation masks growing underlying SaaS sales Reported SaaS segment revenues – USD million SaaS segment revenues – NOK million* +19% -8% 28 4.0 25.9 25.3 3.59 3.57 3.53 3.44 3.5 3.30 24 22.3 21.8 21.1 3.0 20 2.5 16 2.0 12 1.5 8 1.0 4 0.5 0.0 0 Q1 ’14 Q2 ’14 Q3 ’14 Q4 ’14 Q1 ’15 Q1 ’14 Q2 ’14 Q3 ’14 Q4 ’14 Q1 ’15 13 *Calculated from reported revenues using average quarterly FX rates