Caybon First Quarter Report January - March 2022

Stable start of the year

January - Mars 2022

• Net Sales increased by 35% to 241,446 (178,213) TSEK, of which 0.3% is organic growth and 4.4% is exchange rate related.
• EBITDA increased with 12% to 28,133 (25,226) TSEK
• EBIT increased 22% to 22,695 (18,585) TSEK
• EBIT-margin decreased to 9.4% (10.4)
• Cash Flow from operations was -8,025 (6,972) TSEK
• Net Profit for the period amounted to 9,164 (6,827) TSEK
• It should be noted that Splay One was not part of the Caybon Group in the first quarter 2021.

 Significant events in the first quarter

• Caybon has purchased 8.7 MSEK of its bond. The reason being to conserve interest given that the company had excess cash.
• Caybon has decided to rename the two business segments to Campaign (unchanged) and Network (previously "Platform"). This is purely a change of name.
• The tragic war in Ukraine has so far limited direct effects on Caybons business.

CEO - Comment

Good start of the year

2022 has started well with stable revenues in both business segments and record performance in Newsner. All in all this gave us an all-time-high in EBIT for the first quarter amounting to 22.7 MSEK (18.6).

Strong financial performance in the first quarter

Caybon continues to grow and the EBIT level is the highest ever in Caybons history. The revenue growth in the first quarter is mainly from the acquisition of Splay One and to some extent from Fx. Looking at EBIT which amounted to 22.7 MSEK (18.6) the increase come from both business segments and looking at the underlying business areas it is Mediaplanet and Appelberg in the Campaign segment and Newsner in the Network segment which has outperformed last year substantially.

Digital media continues strong development

The global marketing spend has grown at a pace of 7 percent per year until Covid impacted the industry in 2020. In 2021 the market rebounded and is now expected to grow again with around 6 percent per year according to PwC Global Media and Entertainment Outlook. Growth in ad spend is now almost solely coming from growth in digital advertising while analog advertising is declining somewhat. In 2021 the proportion of digital advertising was estimated at 62% as compared to 41% five years earlier in 2016. This demonstrates the advertising landscape that Caybon is active in and it is worth noting that the growth in digital ad spend is driven by growth of social media and video content according the the same PwC report.

In this landscape Caybon is well equipped to address varying client needs and we can profit from our capabilities in digital content, especially videos as well as its distribution capacity on various digital networks.

Splay One transformation

Splay One is the most recent addition to the Caybon group which joined in April last year. Splay One is the Nordic leader within branded entertainment and one of the largest Multi Channel Networks in the EMEA-region. With over 250 million video views a month, Splay One creates engaging content together with some of the biggest influencers in the Nordics. With YouTube and other social media platforms as main distribution channels Splay One is able to reach their clients target groups by producing creative content.

Splay One now continues its transformation. With the appointment of Jonna Säll as CEO of the Splay One the business area now has a head with a background in Caybons entrepreneurial and sales oriented culture. Splay One continues its journey towards profitable growth, streamlining the cost base and increasing sales efficiency.

Outlook

Total ad spend and digital ad spend especially is set to increase. Caybon is well equipped to take advantage of this increasingly complex landscape. We will continue to adapt our capabilities and business models to the clients needs and the consumers preferences.

The situation in Ukraine is very tragic and on a personal level we are all doing what we can to support them. From a corporate perspective Caybon has seen little impact so far from the various uncertainties arising. However, with increasing inflation, interest rates, supply chain issues and other matters the world is no doubt facing a great deal of uncertainty which could affect our clients and indirectly Caybon.

Richard Båge, CEO