Minds + Machines Group Limited Financial Results FY2016 Presentation – 25 April 2017 http://mmx.co
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 MMX. 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. 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. Slide 2 Minds + Machines Group Limited | Financial Results FY2016
Our Mission To be a leading pure-play registry of new generic top-level domains (“new gTLDs”) delivering a predictable annuity revenue stream of scale .boston .vip .cooking .beer .law .work .casa .yoga .fashion
At a glance Market Cap: GBP75.2m | Ticker Symbol: LSE: MMX FY 2016 gross billings Domains under management including committed orders, currently $15.8 million – up c 1.2 million 100% up from 821,000 as of 31.12.16 (FY 2015: $7.9million) (31.12.15: 289,000) Cash and cash equivalents FY 2016 billings operating EBITDA profit Intangible assets $15.3 million before one-off restructuring costs, $4.2 million $45.6 million as at 31.12.2016 (FY 2015 billings EBITDA loss of $6.6million – (still based on book value) excluding one-off private auction proceeds) Slide 4 Minds + Machines Group Limited | Financial Results FY2016
Key business highlights Nascent, large and fast growing market • Diversified and differentiated world-class portfolio of top-level domain assets • Successfully transitioned into a low cost-base, pure-play portfolio registry • Strong global distribution partner network – Asia, Europe, US • Clear vision of underlying customer base, markets and appropriate revenue model • Experienced management team • Proven monetization strategy now delivering profitable growth • Slide 5 Minds + Machines Group Limited | Financial Results FY2016
Fast grow ing market Global Registrants per Country China | 48.2% Net Registrations 13,937,779 Domains 31 December 2015 31 December 2016 Net Growth Verisign (.com, .net) 139.8m 142.2m 2.4m Country codes 138.1m 142.7m 4.6m New gTLDs 11.2m 27.6m 16.4m Other | 9.5% Source: Verisign 2,756,676 Domains Key drivers Global growth of SME’s Germany 2.16% Russian Federation 1.78% USA | 10.81% Digital entrepreneurs United Kingdom 1.49% 3,124,445 Domains Whois Proxy Japan 1.27% Domain investors (Unknown Registrant) | 22.2% France 1.00% 6,424,270 Domains India 0.76% New Zealand 0.76% Slide 6 Minds + Machines Group Limited | Financial Results FY2016
Differentiated and diversified portfolio Uncontested TLDs .abogado .bayern .beer .boston .budapest .casa .cooking .dds .fashion .fishing .fit .garden .horse .law Owner/operator of leading China • facing new gTLD .vip .luxe .miami .nrw .rodeo .surf .vip .vodka - Upto 8 further TLDs going . 购 物 .wedding .work .yoga through Chinese regulator, MIIT, approval process In partnership .country .london Largest portfolio of geographic • On behalf of clients gTLDs .bradesco .gop – 6 in Europe & US Contested TLDs Quality vertical interest & • .cpa .gay .home .hotel .inc .llc generic TLDs In partnership .music Slide 7 Minds + Machines Group Limited | Financial Results FY2016
Low cost-base portfolio registry operator MMX REGISTRY Business transformed into pure-play registry by new • management team during 2016 Now structured to operate across three key geographic • regions – US, Europe, Asia REGISTRY SERVICE PROVIDER OPEX capped at $6million (ie. goal: <33% of gross billings • in a stable state environment) COGs capped at 20% of gross billings so as • to deliver targeted gross margin >80% REGISTRARS Global distribution partner • network established END USERS Slide 8 Minds + Machines Group Limited | Financial Results FY2016
Strong global distribution partner network & office location Continental Europe 37 London (UK) 2 UK 14 Munich (Germany) 1 North America 34 Seattle 7 China 50 Dublin (Ireland) 3 Remote 5 Japan 3 Xiamen (China) 2 Key India/South East Asia 5 Registrar partners per region Office Locations South America 1 Rest of the world 7 Headcount (includes Exec team) 20 Slide 9 Minds + Machines Group Limited | Financial Results FY2016
Experienced Senior managers management team Deep Shah Financial Controller Executive Directors Solomon Amoako VP, Channel Management Toby Hall Michael Salazar Chief Executive Chief Operating Officer & Yuling Huang Officer Chief Financial Officer General Manager, China Caspar von Veltheim Director of European Non Executive Directors Operations + Sales Victor H. Pitts Guy Elliott Henry Turcan Director Premium Sales, Americas Non-Executive Non-Executive Director Chairman Lou Andreozzi CEO, Dot Law Inc. Slide 10 Minds + Machines Group Limited | Financial Results FY2016
Clear vision of underlying customer base, markets and revenue model Key end-markets Supportive revenue model Supporting registrars to target SME’s and • vertical sectors First year premium name billings Supporting registrars to target digital • entrepreneurs Supporting registrars to target domain Standard name sales • investors and ongoing renewals 1st Year 2nd Year 3rd Year 4th Year 5th Year Slide 11 Minds + Machines Group Limited | Financial Results FY2016
Proven monetization strategy now delivering profitable grow th KPIs Domains under management 1,400,000 1,200,000 1,200,000 1,000,000 800,000 821,000 DUMs 600,000 400,000 289,000 200,000 0 2015 2016 2017 - to date Slide 12 Minds + Machines Group Limited | Financial Results FY2016
Proven monetization strategy now delivering profitable grow th Annual gross billings $’000 18,000 16,000 15,800 Annual gross billings $ 14,000 12,000 10,000 7,922 8,000 6,000 4,000 2,000 0 2015 2016 Slide 13 Minds + Machines Group Limited | Financial Results FY2016
Proven monetization strategy now delivering profitable grow th Fixed OPEX 14,000 160% 148% 140% 12,000 11,745 OPEX as a % of gross billings 120% 10,000 100% 8,000 $’000 7,182 80% 6,000 6,000 60% 4,000 45% 40% 2,000 20% 0 0% 2015 2016 2017 - expected 2015 2016 Slide 14 Minds + Machines Group Limited | Financial Results FY2016
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