thescore q3 f2016 conference call presentation
TRANSCRIPT
July 14 2016
Q3 F2016
Forward looking statementsAll statements other than statements of historical facts included in this presentation may constitute forward-looking information and are based on the best estimates of Management of the current operating environment. These forward-looking statements are related to, but not limited to, theScore’s operations, anticipated financial performance, business prospects and strategies. Forward looking information typically contains statements with words such as ‘‘anticipate’’, ‘‘believe’’, ‘‘expect’’, ‘‘plan’’, ‘‘estimate’’, ‘intend’’, ‘‘will’’, ‘‘may’’, ‘‘should’’ or similar words suggesting future outcomes. These statements reflect current assumptions and expectations regarding future events and operating performance as of the date of February 29, 2016.
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Q3 F2016 OVERVIEW
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•The second best quarter for revenue in theScore’s history.
•Powerful engagement growth of our mobile applications.
•Major advertising deals with new and existing brand partners in the US and Canada.
•Reinforcing our flagship app as the main challenger to ESPN on mobile and further expanding our esports coverage to make us the clear leader in the space.
•Taking theScore experience onto new and exciting platforms…
Q3 F2016 Overview
•Quarterly revenue of $6.1M (up 94% year-over-year).•Advertising revenue up 105%. •Total revenue for nine months ended May 31 $18.9M versus $12.4 for all of F2015.
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Q3 F2016 Overview
F2013 F2014 F2015 F2016
As of Q3 F2016
Fiscal Year: September 1 – August 31
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Q3 F2016 Overview•Average monthly active users of theScore’s mobile apps reached 4.3 million in Q3 F2016 (up 5% year-over-year).
•Average monthly user sessions of theScore’s mobile apps reached 358 million in Q3 F2016 (up 27% year-over-year).
• Sports fans opening theScore’s apps 80-90 times a month EACH on average.
User engagement has more than doubled in three years
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Q3 F2016 Overview•Advertising revenue driven by US programmatic business and Canadian direct sales.
•Major six-figure deals secured with globally recognized brands across North America, including Honda, NBC and Buffalo Wild Wings.
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Q3 F2016 Overview•Flagship app theScore is the leading challenger to ESPN on mobile.
•In one year theScore esports has grown to become the leader in competitive gaming coverage.
•Company focus remains on increasing audience and engagement across our existing platforms…
•...while also ensuring we’re responding to the ongoing evolution in the way sports fans consume digital media content.
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Q3 F2016 Overview•First ever sports media chatbot on Facebook Messenger.
•Potential audience of almost one billion people globally.
•theScore believes chatbot technology is potentially transformative in the way sports fans and people consume content on mobile devices.
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theScore – Everywhere!
Mobile Apps
Video & Web
Messaging
Social
Leading in-house software development team
Dynamic newsroom producing engaging & original editorial content
Best-in-class mobile sports apps, delivering real-time scores, news and stats across sports and esports to 4.4 million users.
Massive combined social media footprint of more than 3M sports fans, with powerful engagement ensuring theScore’s content is amplified across the social web every single day.
First sports media brand with a chat bot on Facebook Messenger and an early entrant on Kik, giving theScore a way to reach the one billion plus users on messaging apps.
In-house video team producing original features, interviews and highlights for esports, with theScore.com and theScoreesports.com visited by more than 5 million sports fans on mobile and desktop each month.
Q3 F2016 Overview
Product Updates
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Product Updates
•theScore has assembled a dedicated chatbot team.
•Treating bots as their own unique platform and product offering.
•Now focused on deeper features and making our chatbots more ‘conversational.’
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Product Updates•Added functionality for the two major summer soccer tournaments – Copa America and EURO 2016.
•Achieved strong user metrics that exceeded our expectations, with 1.7 million users accessing these sections.
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Product Updates•Now finalizing support for the Summer Olympics in Rio.
•Functionality will include team-specific medal alerts and breaking news as well as dedicated sections for men’s and women’s basketball and soccer.
•Summer events bolster what is traditionally a slower season for theScore’s flagship app.
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Product Updates•Launched redesign of our iOS and Android apps to deliver sharper visuals.
•Onboarding process also added to encourage more personalization and improve retention and engagement.
•Also redesigned theScore esports’ website in response to the higher demand for desktop content by fans of competitive gaming.
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Product Updates•Re-launch of theScore’s fantasy offering will include rebranding as well as a deeper focus on social gaming.
•Will be free-to-play, ad supported, offer cash prizes and be available across North America.
Financials
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• Q3-over-Q3 revenue growth of 94%.• Q3 Advertising revenue growth of 105%.
• Growth driven by increased programmatic advertising sales in US market and direct sales in Canada.
• YTD revenue growth of 101%.• YTD Advertising revenue growth of 116%.
Revenue – Q3
Revenue - YTD $ 18,930 $ 9,426
$ 3,161
F2016 F2015
$ 6,125
Fiscal Year: September 1 – August 31
94%
Financials – Revenue Q3 F2016 / YTD
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101%
• Expense increases in personnel ($1.7M), mainly development and content.
•Other expense increases in marketing ($0.4M), admin ($0.2M), amortization ($0.5M).
Revenue
Operating Expenses
Adjusted EBITDA
$ 10,420
$ (2,981) $ (3,228)
$ 7,140
$ 3,161
Q3 F2016 Q3 F2015
$ 6,125
Fiscal Year: September 1 – August 31
94%
Financials – Q3 F2016
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• $5.2 million of tax credits recoverable.• Received Certificate of Eligibility, and expect to collect by Q1 of 2017.
• DSO’s at 87 days.
Cash
Current Assets
Working Capital
$ 31,286
$ 26,568 $ 36,253
$ 40,836
Q3 F2016 Q4 F2015
$ 19,479
Fiscal Year: September 1 – August 31
$ 31,841
Financials – May 31, F2016
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Q&A