Kinnevik Ab Class A · OMXSTO:KINV_A
Kinnevik Ab Class A — Q1 2012 Earnings Presentation
25 slides from Kinnevik Ab Class A's earnings presentation, Oct 31, 2012
Slide 1: Presentation of Financial Results Q1 2012
PRESENTATION OF FINANCIAL RESULTS Q1 2012
Slide 2: Resilient performance in tough markets
HIGHLIGHTS Q1 2012 RESILIENT PERFORMANCE IN TOUGH MARKETS • Net Asset Value increased by SEK 3.3 billion to SEK 65.1 billion • Good momentum in investment activity – SEK 2.7 billion invested in online • Online share of net asset value now 15% • Resilient performance in telecom and media business • B
Slide 3: Our value drivers
HIGHLIGHTS Q1 2012 OUR VALUE DRIVERS Agriculture & renewable energy (1%) Microfinancing (1%) Paper & packaging (7%) Media (9%) Telecom & services (67%) Online (15%) 3
Slide 4: Consumer online drives growth
HIGHLIGHTS Q1 2012 CONSUMER ONLINE DRIVES GROWTH • Rapidly changing consumer and business behaviour drives demand across Kinnevik’s portfolio, through ONLINE IN KINNEVIK NAV growth in: – Value added services in Millicom – Data traffic in Tele2 – Online TV such as Viaplay – now also launched in Russi
Slide 5: Presence in emerging markets
OUR VALUE DRIVERS PRESENCE IN EMERGING MARKETS SALES PER REGION • Average annual return of 20% last 30 years 5
Slide 6: Telecommunication and services
OUR VALUE DRIVERS TELECOMMUNICATION AND SERVICES • Data traffic drives growth – Value-added services in Milliom more than 30% of recurring revenue – Mobile data revenues in Millicom grew 51% in Q1 – Half of Tele2’s post-paid customer base uses smart phones • Innovation – new successful services – In
Slide 7: Millicom
TELECOMMUNICATION AND SERVICES MILLICOM USD m Q1 2012 Q1 2011 Change % Total revenues 1,168 1,081 +8 EBITDA 517 509 +2 EBITDA margins 44.2% 47.1% Data service users, 4.7 end of period (m) • Revenue growth in local currency of 8.4% • Focus on new categories is yielding strong results: over 80% of gro
Slide 8: Tele2
TELECOMMUNICATION AND SERVICES TELE2 SEK m Q1 2012 Q1 2011 change % Operating revenue 10 481 9 642 +9 EBITDA 2 571 2 544 +1 EBITDA margins 25% 26% Mobile subscribers, end 31.8 27.6 of period (m) * • Tele2’s customer base amounted to 34.8 million customers • Tele2 Kazakhstan continued its successful
Slide 9: Opportunistic investments with a long-term strategic focus
OUR VALUE DRIVERS OPPORTUNISTIC INVESTMENTS WITH A LONG- TERM STRATEGIC FOCUS • We identify the best growth trends • We invest early in several companies exposed to that trend • We continue to invest in the best companies in multiple rounds • Enables us to build a portfolio of large holdings in lead
Slide 10: Online growth is global
OUR VALUE DRIVERS ONLINE GROWTH IS GLOBAL • E-commerce penetration has doubled since 2004 • Dramatic shift from offline to online retail • Kinnevik’s online investments are global NUMBER OF INTERNET USERS (MILLION), 2000 vs 2011 20 10 5 10 Source: Internetworldstats.com
Slide 11: Online investments
ONLINE ONLINE INVESTMENTS Investment (SEK m) Ownership Invested amount Estimated fair values Rocket internet with portfolio companies mixed 6 090 7 876 Groupon, directly owned shares 8,377,156 20 959 Avito 50% 285 336 CDON 25.1% 5171) 940 Other online investments mixed 512 205 Total 7 424 10 316 1)
Slide 12: Selected performance highlights
ONLINE SELECTED PERFORMANCE HIGHLIGHTS Company Measure 2011 2012 +67% Unique visitors Mar 2012 vs. 2011 Number of orders 20x w. 13 2012 vs. 2011 +76% Fashion net sales (MSEK) 196 Q1 2012 vs. Q1 2011 112 Unique visitors +47% Feb 2012 vs. 2011 Net revenue (MUSD) +194% 506 Q4 2011 vs. Q4 2010 172 12
Slide 13: Online shoes and fashion
ONLINE ONLINE SHOES AND FASHION • Zalando – online shoes and fashion retailer – 8 markets (Germany, France, UK, Netherlands, Italy, Austria, Switzerland, Sweden) – 700 brands – Strong sales growth and high brand awareness • Online shoes retailing outside Europe in several continents including: - Bra
Slide 14: Strong growth in e-commerce
ONLINE STRONG GROWTH IN E-COMMERCE • Groupon – group discount worldwide – 45 countries and 10,000 employees – Revenues of USD 1,610 million in 2011 – Offerings within local, national, travels, events and Now! • Avito – The number one site for online classifieds in Russia – 4.2 million new classified
Slide 15: Media
OUR VALUE DRIVERS MEDIA • TV dominant brand-building vehicle for advertisers • Strong market positions and brands – 125 million daily TV viewers in 31 markets • Scandinavia • Eastern Europe • Start-up in Ghana – Africa • Online TV such as ViaPlay changes consumer behaviour • 18 million daily Metro r
Slide 16: Modern Times Group
MEDIA MODERN TIMES GROUP SEK m Q1 2012 Q1 2011 Change (%) Total revenues 3 259 3 125 4 Total operating profit 542 686 neg (EBIT) EBIT margins 17% 22% • Net sales up 4% year on year to SEK 3,259 (3,125) million • Operating income of SEK 341 (432) million when excluding associated company income • Tot
Slide 17: Metro
MEDIA METRO EUR m Q1 2012 Q1 2011 change Operating revenue 47.3 45.2 4.6 Total operating profit (EBIT) 0.6 1.1 neg EBIT margins 1.2 2.5 • Kinnevik share offer complete – share ownership fully diluted 97.1% • Net revenue increased by 4% • EBIT EUR 0.6m • Sales growth in Chile, Mexico and St Petersbur
Slide 18: Microfinance
OUR VALUE DRIVERS MICROFINANCE • Market with low penetration – 130 million clients, potential of 1.5 billion • Need for equity investments of USD 15-20 billion the coming 5 years to sustain growth in the industry • First phase mainly small microloans but sector will develop into broader financial se
Slide 19: Paper and packaging
OUR VALUE DRIVERS PAPER AND PACKAGING • Growth = GDP (developing markets is the growth engine) • Paper and board have a 40% market share of food packaging • Demand for constant development and new thinking drives the market • New consumption patterns - different demands on packages Portion packs Re-
Slide 20: Korsnäs
PAPER & PACKAGING KORSNÄS SEK m Q 1 2012 Q1 2011 Change (%) Total revenues 2 166 2 135 +1 EBIT 240 264 neg EBIT margins 11.1% 12.4% Deliveries (Ktonnes) 263 259 • World’s 2nd largest liquid packaging board producer • Premium segment producer of folding carton board • Somewhat weaker demand in first
Slide 21: Agriculture & renewable energy
OUR VALUE DRIVERS AGRICULTURE & RENEWABLE ENERGY • The world’s population is growing and becoming wealthier • Traditional energy sources become more scarce • Environmental awareness increases • Development of new technologies • Black Earth Farming is the largest investment within agriculture – 328,0
Slide 22: Profit and loss
FINANCIALS PROFIT AND LOSS SEK m Q 1 2012 Q 1 2011 Total revenues 2 406 2 282 Operating profit 243 261 Changes in fair value 2 857 -101 Net financial expense -89 -65 Profit before tax 3 011 95 Tax -49 -46 Net income 2 962 49 25
Slide 23: Kinnevik's balance sheet 31 March 2012
FINANCIALS KINNEVIK’S BALANCE SHEET 31 MARCH 2012 • Strong financial position • Net debt amounts to SEK 7,617 million – SEK 5,706 million against Korsnäs - high leverage to maximise returns • SEK 2,570 million in unpaid investments not included in net debt by end Q1 • Parent company’s leverage again
Slide 24: Kinnevik's see-through P&L development
FINANCIALS KINNEVIK’S SEE-THROUGH P&L DEVELOPMENT (SEK m) EBIT-margin 50 000 20% 40 000 15% 30 000 10% 20 000 5% 10 000 0 0% Q2 09 Q3 09 Q4 09 Q1 10 Q2 10 Q3 10 Q4 10 Q1 11 Q2 11 Q3 11 Q4 11 Q1 12 Revenues EBIT EBIT margin • Sales up by 13% to SEK 10.9 billion compared to Q1 2011 • EBIT down 12% to
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