2021 H1 Results
September 28, 2021
Disclaimer
This presentation does not constitute or form part of and should not be construed as any offer for sale of or solicitation of any offer to buy any securities of ATEME, nor should it, or any part of it, form the basis of or be relied on in connection with any contract or commitment whatsoever concerning ATEME’s assets, activities or shares.
All statements other than historical facts included in this presentation, including without limitations, those regarding ATEME’s position, business strategy, plans and objectives are forward-looking statements.
The forward-looking statements included herein are for illustrative purposes only and are based on management’s current views and assumptions. Such forward-looking statements involve known and unknown risks. For illustrative purposes only, such risks include but are not limited to impact of external events on customers and suppliers; the effects of competing technologies competition generally in main markets; profitability of the expansion strategy; litigation; ability to establish and maintain strategic relationships in major businesses; and the effect of future acquisitions and investments.
ATEME expressly disclaims any obligation or undertaking to update or revise any projections, forecasts or estimates contained in this presentation to reflect any change in events, conditions, assumptions or circumstances on which any such statements are based, unless so required by applicable law. These materials are supplied to you solely for your information and may not be copied or distributed to any other person (whether in or outside your organization) or published, in whole or in part, for any purpose.
Presenters
Michel Artières
Founder & Chief Executive Officer
Degree in Engineering from Supelec, Paris, with a specialization in signal processing and
telecommunications
Fabrice Sana
Chief Financial Officer
Degrees from the European Business School and ESSEC
1. Two Leaders Joining Forces
2. Market Trends
3. H1 2021 Results
4. Outlook
ATEME + ANEVIA = Two Leaders Joining Forces
51 Patents
Up 70% in 2020
490 people in 20 countries Public since 2014
1000+ clients in 100 countries 71 M€ in 2020, up 7%
ATEME + ANEVIA help Content Providers and Service Providers transform their video delivery to enable innovative live and on demand video services and enhance the quality of experience MRR
MONTHLYRECURRING REVENUE
A Complete Offer for the Complete Video Flow
Service Provider (Satellite, Cable, Telco)
Video Headend Event
Contribution Primary
Distribution Distribution
OTT / Multiscreen
Subscriber CDN
Content Provider TV Network
Kyrion encoders in the trucks and TITAN is a virtualized Video Headend NEA is a software suite for the OTT NEA is a software suite for the
ANEVIA & ATEME to Win the OTT Market
Service Provider (Satellite, Cable, Telco)
End-user Content Provider
TV Network
Direct-to-Consumer
Channel Origination
Video Headend
OTT
Streaming CDN Cloud DVR Analytics
High Fidelity Quality Multi-Cloud Operations
Reduced TCO of 1000’s of channels
Low Latency Network
Monetizing OTT with Cloud DVR, Catch-up TV Customize Ads and Content
Enhanced Customer Satisfaction Increased ARPU & Ads Revenue CDN
Contribution Distribution File Prod File VOD D2C Distribution
Channel Origination
Origin
Server Cloud DVR DAI CDN Analytics
x x x x x x x x x x x
x x x x x x x x x (3rdparty)
x x x x x x x x
x x x x x x x x
x x x x x x x Cloudfront Analytics
x x x x x
x x x x
x x x x
$2b TAM, Unique Innovative Player with E2E Offering
~$1b TAM
~$1b TAM
Video Headend and CDN Complementary Sales Cycles
Year 1 Year 2 Year 3 Year 4 Year 5
Headend (encoding) CDN (incl. Origin)
In ves tmen t ($ )
Video Headend (encoding) business
• Investments driven by the amount of content (live channels, VOD catalogue)
• Typically generating flat repeat business
CDN / OTT video delivery business
• Investments driven by the growth of the traffic
• Successful OTT services face a X2 traffic every year
ATEME Engaged in Corporate Social Responsibility
People Environment
Ateme and our people
• Focus on talent development
• Equal treatment for men and women
• Non-discrimination in hiring
• Ethic management
Ateme and the world
• Ethic business relationship with shareholders, clients, partners and suppliers
• Donations to charity organizations (humanitarian, education)
Titan and Nea innovations saved 65% of the video delivery energetic impact in 3 years while improving viewers’ experience
Targeting 50%+ additional savings in the next 3 years
Ateme committed to reduce our own impact by 50% in 3 years
• Reduction of business trips and attendance on trade shows
• 50% telework approved for R&D and HQ as the new normal
Making the Streaming Greener and More Sustainable
ATEME is Founder Member
of the ‘’Greening of Streaming’’ Alliance Promoting the changes ensuring that Streaming becomes as sustainable as we can make it
• Creating working groups for setting Industry’s new standards
• Commissioning papers on the state of the sector
• Measuring the gains in improvements made by our members
Other founder members include:
By being a founder member, ATEME confirms its leadership position
influencing the sustainable future of the Streaming industry
1. Two Leaders Joining Forces
2. Market Trends
3. H1 2021 Results
4. Outlook
Media Tech Market Severely Impacted by Covid
• Trends confirmed by Harmonic results (Nasdaq HLIT)
• Video revenues down 13% YoY to $242 million in 2020 (from $278 million in 2019)
Subscription revenues up
Advertising revenues dropped
TOTAL MARKET DOWN 9,9% (DEVONCROFT)
Evolution of the Media Landscape
Studios/Broadcasters/Networks Created string brands in the 80’s-90’s
Service Providers (MVPDs)
Historically, got the broader access to customer SVOD or Ad-Supported VOD Service
Impose Binge Watching as the Way to consume video
Virtual Service Providers (vMVPDs) New content or Skinny cost-effective bundles New
Entrants
Digital Native
Traditional Players
TV/STB native
Content Providers
Create/Produce/License Content
Service Providers
Aggregate/Distribute Content
Subscribers Move to New Services, TV Viewing is Shifting
The AVOD- SVOD continuum excluding traditional linear TV
Pay TV and SVOD subscribers Europe, million subscribers, 2014-20
SVOD & OTT services subscribers experience the highest growth rate
The switch to online video is global
Source: Dataxis
Transition to the Cloud
Post Covid-19, 93% of enterprises have a multi- cloud strategy
Companies use an average of 2.2 public clouds and 2.2 private clouds
Public Cloud
Source: Flexera 2020 State of the Cloud Report
Strengthening ATEME competitive advantages
• ATEME solutions are agnostic to infrastructure
• Strong partnership build with AWS, MS Azure, Google Cloud and leading regional cloud providers
Private cloud Virtualisation
Accompanying the Migration to Private CDN / Multi CDN
Service CDN
Build your own CDN Interconnect CDN Enabled
• Pay as you go
• Global reach
• CAPEX investment
• QoS control
• Analytics
• ISP partnerships
CDN S e le ction
Source: Rethink Research, CDN Forecast to 2024, September 2019
75%
25%
75% of video traffic in North America delivered through private CDN
5G Broadcast – When Over-The-Air Meets Over-The-Top
• Convergence of OTT and Over-the-Air
• Pro-active standardizations activities:
DVB-I, MABR, CMAF
• Strong parentship with ecosystem players
Leveraging Ateme’s expertise
and involvement in standardisation
Enabling Personalization for Boosting Engagement
Netflix is testing a TV-like channel based on their recommendation engine
The Wheather Channel has launched
a local OTT version
The Power of Personalization
Source: Deloitte Insights Source: Google
Source: Tivo
Boosting Viewership Engagement Customers are Looking for It
Increase Ads Revenue
How We Help
Personalization Sustainable & Green
Video Services
Generate New Revenue Streams
Next Gen Distribution:
5G, Services Aggregation Lower Cost of Delivery and
Customer Acquisition High QoE on any screen
boosting subscription
Comparables and Valuation Reference Points
Acquisition of direct competitors
Sept 2015
$300-500M (5-7x Sales) acquires
Sept 2015 acquires
$125M (4x Sales)
Dec 2015 acquires
€69M (1x Sales)
Recent transactions
(Nasdaq: HLIT)
Impact of recurring revenues
Avid (Nasdaq: AVID) Leader in film/sports production
$360M in 2020 revenue ($197M in subscription & maintenance)
Market cap $2B (5x sales)
Esker (Euronext: ESKER) Enterprise Software
€112M in 2020 revenue (81%
recurring SaaS & maintenance) Market cap €1,6B (14x sales) Market leader
Declining Video business, transitioning to SaaS
Growing Cable access business
Market cap $1B (2,5x sales)
Market leader and main competitor
IPO on Nasdaq July 2021
E-learning, enterprise and media
$120M in 2020 revenue
Market cap $1,5B (12x sales)
acquires July 2021
Live streaming and remote production
$400M (3,5x Sales)
1. Two Leaders Joining Forces 2. Market Trends
3. H1 2021 Results
4. Outlook
2014 2015 2016 2017 2018 2019 2020 2021
Q1 Q2 Q3 Q4
Revenues Evolution by Quarter
€37.5m
€28.6m
€24.8m
IPO
€48.6m
+12%
Growth
In H1 2021
-4%
at constant exch. Rate &
perimeter
€56.5m
€66.3m
12.4
€70.7m
5.3
Q2 up by only 1% due to delays in booking and shipping 3 large orders
15.5
16.7 16.9
€32.4m
H1 2021 Revenue Split and Growth by Region
USA/CAN -17%
LATAM +42%
APAC -19%
H1 2021 REVENUE SPLIT BY REGION H1 2021 REVENUE GROWTH BY REGION
-xx%
at constant exchange rate
+xx%
at constant exchange rate
+xx%
at constant
exchange rate EMEA
+68%
-16%
(at constant exch. rate and
perimeter)
-1%
(at constant exch. rate and
perimeter)
-16%
(at constant exch. rate and
perimeter)
EMEA 13.3 41%
USA/Canada 10.5 32%
LATAM 4.3 13%
APAC 4.4
14% +12%
(at constant exch. rate and
perimeter)
January 2018
January 2019
January 2020
January 2021
July 2021
Continued Growth in MRR in H1 2021
Multi-Year investment
Contracts
Monthly Recurring Revenue
Maintenance Subscription
✓ Increased visibility with secured revenues
✓ Higher resilience in crisis
✓ Increased profitability with optimization of S&M costs
300
880 570
1,500
+55%
yoy
+70%
yoy
Monthly recurring revenues amounts to almost €1.7m in July 2021, with a high ratio of renewal of existing support contracts in all
regions.
MRR
, in € thousands1,685
+12%
since Jan.
ARR exceeds
€20 million Integration
of Anevia
H1 2021 P&L
Consolidated data – IFRS –in thousands of euros
Higher gross margin due to improved mix product included substantial software sales in H2
Other expenses (€24.3m versus €16.8m in H1 2020), up 44%, mainly reflecting Anevia integration and R&D
investments on TITAN Playout
+12%
+35%
+10.3pts
+109%
+170% €4.4m net loss in H1 – in line with seasonality in the business
H1 2020 H1 2021
Revenue 29,039 32,436
Gross profit 14,554 19,576
Gross margin 50.1% 60.4%
R&D expenses (5,640) (8,717)
Sales & marketing expenses (9,484) (13,164)
Other G&A expenses (1,674) (2,388)
Operating profit (2,243) (4,693)
Operating margin -7,7% -14.5%
Financial loss (99) (227)
Financial profit 4 21
Exchange effect (60) 360
Tax income (193) 209
Net profit (2,591) (4,380)
Net margin -8.9% -14.5%
EBITDA at €-1.8m in H1 2021
IPO July 2014
2015 2016
2014
Growing Profitably Since 2016
2017
€12.3m
€-2.5m
€15.0m
€-1.6m
€16.3m
€0.0m
€12.9m
€-1.1m
€11.9m
€-0.9m
€22.5m
€3.6m
€20.9m
€0.3m
€27.7m
€3.5m
2018
€23.2m
€-3.2m
€33.3m
€4.9m
2019
€30.1m
€-1.2m
€36.2m
€5.8m
2020
€29.0m
€-2.6m
165
135
170
220 252 300
490*
€41.7m
* incl. Anevia employees
€2.3m
€32.4m
€-4.4m
2021
2021/06/30 Balance Sheet
Consolidated data - IFRS – in thousands of euros
2020/12/31 2021/06/30
ASSETS
Non-current assets 31,942 31,695
o/w Goodwill 13,186 13,186
o/w Intangible assets 10,850 10,451
Current assets 61,530 55,600
o/w stocks 4,456 5,354
o/w trade receivables 31,665 26,934
o/w cash and cash equivalents 17,095 12,255 93,472 87,294
LIABILITIES
Shareholders’ equity 35,560 33,128
Non-current liabilities 19,234 18,537
o/w non-current financial debt 16,154 15,613
Current liabilities 38,678 35,629
o/w current financial debt 8,371 6,783
o/w trade payables 14,605 11,192
H1 2021 FCF
Consolidated data - IFRS – in thousands of euros
2020/06/30 2021/06/30
Net Profit (Loss) (2,591) (4,380)
(-) Elimination of non-cash elements 2,263 2,933
Gross cash flow (329) (1,446)
(-) Change in Working Capital (4,238) 340
Cash flow from operations 3 909 (1,786)
Cash flow from investing activities (1,132) (5,446)
w/o new tangible and intangible fixed assets (936) (1,405)
w/o capitalisation of development costs (295) (291)
w/o acquisition of Anevia (3,738)
Cash flow from financing activities 7,579 2,277
w/o exercice of stock-options 199 1,272
w/o new borrowings 8,078 3,116
w/o interest expense (74) (225)
w/o repayment of loans and contingent advances (224) (1,473)
w/o repayment of financial leases (400) (469)
w/o other financial flows (including factoring) - -
Currency effect (45) 116
Net Change in Cash 10,311 (4,838)
Opening Cash position 10,341 17,092
Significant decreased in trade receivables in H1 2020 (high level of invoicing in Q4 2019)
1. Two Leaders Joining Forces 2. Market Trends
3. H1 2021 Results
4. Outlook
Boosting future profitability with the ramp-up of MRR
€4m
€3m MRR
€1.5m MRR MRR
EBITDA
> €10m
EBITDA
€30m
EBITDA target
Revenues CAGR
10-15%
Strongly growing MRR
MRR covering
50%
of cost base
MRR covering
60%
of cost base
Doubling NEA revenues over 2 years
EBITDA
€5-10m
Moderate revenue growth (like-for-like) & Breakeven at
the operating profitability level in FY 2021
Investor Relations
Next investor dates Market data
ISIN: FR0011992700 - Ticker: ATEME
Stock price: €11.12 (as of September 27, 2021) Market cap: €124.7m (as of September 27, 2021) Concert
Artières 11%
NJJ Capital (Xavier Niel)
5%
Keren Finance 5%
Axa IM 5%
Otus Capital
9%
Others < 5%
65%
Liquidity contract: Kepler Cheuvreux
Source : Company, as of April 30,2021
Shareholder structure
Number of shares : 11,217,027 Potential dilution : 336,511
Stock price (€)
Volumes (nb of shares)
October 20, 2021 ATEME Tech Day
November 5, 2021 2021 Third Quarter Revenues
0 50 000 100 000 150 000 200 000 250 000 300 000 350 000 400 000 450 000 500 000
8 € 10 € 12 € 14 € 16 € 18 € 20 €
02/01/2020 31/01/2020 02/03/2020 31/03/2020 04/05/2020 04/06/2020 03/07/2020 03/08/2020 01/09/2020 30/09/2020 29/10/2020 27/11/2020 29/12/2020 28/01/2021 26/02/2021 29/03/2021 29/04/2021 28/05/2021 28/06/2021 27/07/2021 25/08/2021 23/09/2021