Dotdigital Group Plc · LSE:DOTD
Dotdigital — H1 2023 Earnings Presentation
25 slides from Dotdigital's earnings presentation, March 2023
Slide 1: For the six months Ended 31/12/2022
For the six months Ended 31/12/2022
Slide 2: Continued growth with healthy demand
• Continued growth with healthy demand • Intensified market focus on efficient digital engagement tools with demonstrable ROI • Global teams embedded and early evidence of success in US • Growing recurring revenues and robust balance sheet provide flexibility to invest • Positive outlook with pipeli
Slide 3: Who we are, What we do, Who we help
Who we are What we do Who we help • Formed in 1999 as dotmailer with a Dotdigital’s Customer Experience & Data Over 4,000 brands & c.50,000 active marketing technology vision Platform breaks down data siloes, and gives monthly users. • A global business with a UK headquarters marketers more customer
Slide 4: Customer industry sectors
Automotive & Parts Education Construction & Materials Energy Transportation Insurance Media Retail Travel & Leisure Financial Services Sports & Leisure Government Charity/Not for Profit Real Estate 4
Slide 5: Market trends in digital marketing
Customers expect a more personalised digital experience • Heightened focus on retention and loyalty • Optimisation and cost effectiveness More emphasis on Desire to access digital marketing to real-time insights drive zero party with a single • Email continues to deliver highest ROI data customer vi
Slide 6: Dotdigital CXDP
Dotdigital CXDP Largest independent mid-market customer engagement platform Enterprise (>$30k pcm) Dotdigital TAM (Merged with CM group) Mid-size (Acquired by SAP) ($1k-$30k pcm) (Acquired by CM group) • Unify customer data • Seamless cross- • Real-time insights channel experiences (Part of the CM g
Slide 7: Financial review
dotdigital Financial review
Slide 8: Group revenue
Grouprevenue Profit and cash • Adjusted EBITDA down 10% to £11.1m. after absorbing the employee cost • Revenue grew 9% to £33.8m (H1 22: £30.9m) pressures & strong Investment in the half, 10 year CAGR is 18% • Monthly ARPC increased 11% to £1,573 (H1 • Cash up 24% to £49.6m, giving us various strate
Slide 9: Drive high margin sticky recurring revenues and cash conversion
Drive high margin sticky recurring revenues and cash conversion Revenue Profile +12%* Recurring revenues have grown to +10%* 95% of total Group revenues (94% H1 22), of which contracted recurring c. 90% With contracted recurring revenue revenues are 79% (79% H1 22) gross margin of ~90% *Recurring re
Slide 10: Income statement
• In addition to revenue growth of 9%, Gross margin has marginally declined to 79% (H1 22: 82%) due to revenue £’m H1 23 H1 22 Growth mix as SMS volumes have increased. High transactional Revenue 33.8 30.9 9% SMS volume enables us to optimise margin for our Cost of sales (7.1) (5.5) marketing SMS cu
Slide 11: Healthy balance sheet
• Healthy balance sheet due to good trading and £’m H1 23 H1 22 working capital management. Aged trade Debtor Non-current assets 31.2 30.1 balances remain low. Other current assets 13.0 12.8 • Strong cash position gives us strategic options and Cash 49.6 40.0 interest income, supporting EPS Total as
Slide 12: Cash flow
• Reduced cash flow from operations was due to: £’m H1 23 H1 22 Net cash generated from operations 10.1 12.2 • phasing of profit vs prior year Net cash used in investing activities (4.0) (3.6) • reduced end of period working capital stretch Net cash used from financing activities (0.4) (0.5) Cash an
Slide 13: Growth strategy
dotdigital Growth strategy 13
Slide 14: Our core growth strategies
Expand our product suite: providing organic growth Globalising Focus on cross- selling deeper our talent: customer organisational relationships strength and capabilities Our core growth strategies Grow our Deepening customer base: increasing our Organic our strategic partnerships: global market buil
Slide 15: Geographic expansion, product innovation, strategic partnerships
Geographic expansion • Lower entry run-rate in H2 22 • Embedded team and Product innovation management +19% • Improved customer retention • On track for growth at FY International Strategic partnerships revenue • Improved retention & strong existing client growth • Lower one-off professional service
Slide 16: Product innovation
Geographic expansion • Innovation around analytics and data capabilities has helped us Functionality attract larger businesses. Recurring Revenue • Increased adoption of the customer data platform capabilities with Product innovation an increase of data synchronisation with our off the shelf integra
Slide 17: Product roadmap: integrate, unify, insights, channel reach
Integrate your SCV and contact More data, more More insights, Channel stack unification insights more action reach • Deeper strategic • Unified Contact API • Data ingestion, • AI journey builder • Website personalisation integrations transformation and • Single customer view • Extending our predicti
Slide 18: Dotdigital as a data hub
Dotdigital acts as a data hub that Make light work of your data. Unparalleled channel reach and real- unifies product, customer, and Behavioral modelling and marketing time automation capabilities let you engagement data. Data unification analytics in Dotdigital uncover personalise customer journeys
Slide 19: Strategic partnerships
H1 23 Geographic expansion • Sales from customers using connectors to our strategic 29% partners’ solutions increased by 17% to £16.3m (H1 22: 43% Product innovation £13.9m). • Our ecommerce connector revenue grew by 10% to £10.9m led by growth from our Shopify Connector which grew 23% in the 11% St
Slide 20: Looking ahead
dotdigital Looking ahead
Slide 21: Outlook
Continued momentum at start of H2 Solid financial position Differentiated offering with clear value proposition Expanding addressable market Clear strategic vision for future 21
Slide 22: Questions
dotdigital Questions
Slide 23: Appendix
© dotdigital Appendix
Slide 24: Shareholding and global reach
Shareholding as at 31st December 2022 Global reach • Liontrust Asset Management 18.3% • Directors 10.6% • Octopus Investments 9.3% Switzerland Germany France • Baillie Gifford 5.6% • Slater Investments 5.3% • Investec Wealth & Investment 4.9% • Hargreaves Lansdown PLC 3.4% • Highclere International
Slide 25: Solution overview
Solution overview Resources 25