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Smartbroker Holding AG

Investor Presentation Mar 15, 2023

4535_ip_2023-03-15_7361afcf-922a-4879-b855-f6534b1903ca.pdf

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Earnings Call

Preliminary Results FY2022 | Outlook 2023

SPEAKERS André Kolbinger | CEO Roland Nicklaus | CFO

15 March 2023

Disclaimer

This presentation has been prepared by Smartbroker Holding AG ("Smartbroker Holding") and comprises the written materials/slides for a presentation concerning Smartbroker Holding, its group companies and the product Smartbroker. By attending this presentation and/or reviewing the slides you agree to be bound by the following conditions. The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession this document comes should inform themselves about, and observe, any such restrictions. This presentation is for information purposes only and the information contained herein (unless otherwise indicated) has been provided by Smartbroker Holding. It does not constitute an offer to sell or the solicitation, inducement or an offer to buy shares in Smartbroker Holding or any other securities. Further, it does not constitute a recommendation by Smartbroker Holding or any other party to sell or buy shares in Smartbroker Holding or any other securities and should not be treated as giving investment, legal, accounting, regulatory, taxation or other advice. This presentation has been prepared without reference to any particular investment objectives, financial situation, taxation position and particular needs. In case of any doubt in relation to these matters, you should consult your stockbroker, bank manager, legal adviser, accountant, taxation adviser or other independent financial adviser. The information contained in this presentation has not been independently verified, and no representation or warranty, express or implied, is made as to the fairness, accuracy, completeness or correctness of the information contained herein and no reliance should be placed on it. To the extent permitted by applicable law, none of Smartbroker Holding or any of its affiliates, advisers, connected persons or any other person accept any liability for any loss howsoever arising (in negligence or otherwise), directly or indirectly, from this presentation or its contents or otherwise arising in connection with this presentation. No representation or warranty, either express or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein. This presentation contains forward-looking statements that are subject to risks and uncertainties. Statements contained herein that are not statements of historical fact may be deemed to be forward-looking information. When we use words such as "plan", "believe", "expect", "anticipate", "intend", "estimate", "may" or similar expressions, we are making forward-looking statements. You should not rely on forwardlooking statements because they are subject to a number of assumptions concerning future events, and are subject to a number of uncertainties and other factors, many of which are outside of our control, that could cause actual results to differ materially from those indicated. These factors include, but are not limited to, the following: (i) market risks: principally economic price and volume developments; (ii) dependence on performance of major customers and industries, (iii) our level of debt, management of interest rate risk; (iv) costs associated with regulation relating to providing financial services; (v) inflation, interest rate levels and fluctuations in exchange rates; (vi) general economic, political and business conditions and existing and future governmental regulation; and (vii) the effects of competition. Any assumptions, views or opinions (including statements, projections, forecasts or other forward-looking statements) contained in this presentation represent the assumptions, views or opinions of Smartbroker Holding as of the date indicated and are subject to change without notice. Smartbroker Holding neither intends, nor assumes any obligation, unless required by law, to update or revise these assumptions, views or opinions in light of developments which differ from those anticipated. All information not separately sourced is from internal company data and estimates. Any data relating to past performance contained herein is no indication as to future performance. The information in this presentation is not intended to predict actual results, and no assurances are given with respect thereto.

We are Weathering the Storm Historic Market Development & Several Geopolitical Challenges

*Op. EBITDA after client acquisition cost; 2022 financials are preliminary, unaudited Market data source: ariva.de

Recent News Smartbroker 2.0 Remains Top Priority to Set Us Up for Further Growth

  • Smartbroker 2.0 in advanced stages of development
  • Cooperation agreement with Baader Bank in place

  • New editorial news team & premium products launched

  • Refreshing of wallstreet-online.de kicked-off

  • Celebrated 25 years in business this January

  • Fully financed to complete SB 2.0 launch

2023 & 2024 Plans

  • Launch Smartbroker 2.0 & new brand experience mid 2023
  • Initiate migration of current customer base shortly after
  • Bring new client acquisition efforts back to previous levels
  • Launch new products (crypto, account types)
  • Realize synergies between our media & transaction offering (cross-divisional advertising)
  • Update look & feel of our digital media assets

PROFITABLE GROWTH

Achieve stand-alone EBITDA break-even with Smartbroker including the customer acquisition cost to onboard 75k new clients p.a. by 2024

Connecting All Spheres of Private Investing & Saving

Information & Community

Investors & Savers

Transaction & Optimization

  • Financial news, charts, tools & communities
  • Own editorial team for video and premium content
  • → Diversified product suite for maximum reach

40%+ reach on the German market 1%+ market share on the German market

  • Digital execution-only broker
  • Targeting all savers, investors & experienced traders – setting us apart from entry-level products
  • → Market is not the limiting factor

Preliminary Financials FY 2022

2022 Preliminary Financial Statements Basis of Preparation – Smartbroker Holding AG Accounts

  • Consolidated, unaudited accounts based on German HGB
  • 2022: Smartbroker AG (former wallstreet:online capital AG) fully consolidated as of 1 January 2022 First year with full twelve months consolidation of Smartbroker AG
  • 2021: Smartbroker AG fully consolidated as of 1 January 2021 on pro forma basis Audited financial statements: Smartbroker AG fully consolidated as of 1 August 2021
  • No material changes in the composition of the Group all year-on-year development entirely organic
  • BDO AG Wirtschaftsprüfungsgesellschaft appointed as new auditor for the group and main group entities from FY2022 onwards
  • Full annual report and audited financial statements to be published in July 2023

2022 Preliminary Operational Development Further Growth Despite Challenging Environment & Normalized Media Activity

E: estimate

Preliminary Results Overview Increased Profitability Despite Dip in Top Line

Revenue, in €m

EBITDA before and after CAC, in €m

* Please note: 2021 revenue value represents HGB pro forma revenue, incl. Smartbroker AG (previously wallstreet:online capital AG) fully consolidated from 1 January 2021; In accordance with the management information system (MIS), the FY2021 proforma revenue would amount to €51.4m, without any material effect on the EBITDA.

E: estimate | CAC: client acquisition cost for Smartbroker

Preliminary Revenue Split & Operational KPIs Full Operation Focused on the Launch of Smartbroker 2.0

in €m 2022E 2021 Change in %
Revenue 52.8 56.8 -7%
of which Transaction 18.7 21.3 -12%
of which Media 34.1 35.5 -4%
End of 2022E End of 2021 Change in %
Brokerage accounts (in k) 267 246 +8%
Assets under custody (in €bn) 9.2 8.8 +4%
Ø Assets under custody per account (in €k) 34 36 -4%
Ø Trades per account (annualized) 18 29 -38%

11

Please note: 2021 values are HGB pro forma revenues, incl. Smartbroker AG fully consolidated from 1 January 2021; In accordance with MIS, the FY2021 proforma revenue would amount to €51.4m, without any material effect on the EBITDA | E: estimate

2022 Preliminary Segment Revenue and EBITDA

in €m Group Media Transaction
Revenue 52.8 34.1 18.7
EBITDA before CAC 13.1 14.6 (1.5)
Margin 25% 43% neg.
Client acquisition cost (CAC) (4.0) - (4.0)
EBITDA after CAC 9.1 14.6 (5.5)
Margin 17% 43% neg.

2022 Preliminary Expenses

in €m 2022E 2021 Change in %
Revenue 52.8 56.8 -7%
Capitalized own contribution 2.5 0.9
Other operating income 1.4 0.8
Data, IT & other materials (15.7) (20.1) -22%
Marketing (5.4) (14.3) -62%
Personnel (18.7) (12.6) 48%
Other (7.7) (7.1) 8%
Non-recurring items - (0.5)
EBITDA 9.1 3.9 153%
add back/ (deduct): Non-recurring items - 0.5
Operational EBITDA 9.1 4.4 122%
Add back: Smartbroker Customer Acquisition Cost 4.0 13.1 -69%
Operational EBITDA before CAC 13.1 17.5 -24%

2022 Preliminary Consolidated Profit & Loss Highlights

in €m 2022E 2021 Change in %
EBITDA 9.1 3.9 153%
Depreciation (17.3) (3.2) 441%
of which non-recurring (12.7) -
of which firm value (HGB) (2.7) (1.8)
of which fixed and intangible assets (1.9) (1.4)
EBIT (8.2) 0.7 n/m
Financial result (1.5) (0.7)
of which interest (0.3) (0.2)
of which impairment (1.2) (0.4)
EBT (9.7) (0.0) n/m

2022 Preliminary Consolidated Cash Flow

in €m 2022E 2021 Change in %
Profit (Loss) (9.6) (0.5) n/m
Taxes (1.1) (0.8)
Depreciation and impairment 18.4 3.8 584%
Changes in balance sheet items (4.7) 10.0
Non-cash P&L items 1.3 2.1
Non-recurring Items 0.0 (0.7)
Operating Cash Flow
of which Smartbroker CAC
4.3
(4.0)
13.9
(12.9)
-69%
Capital Expenditure (21.5) (19.8) 9%
Total pre-financing Cash Flow (17.2) (5.9)
Financing Cash Flow 19.2 17.3 11%
Total Cash Flow 1.9 11.4 -83%
Cash at the beginning of the period 25.5 14.1
Cash at the end of the period 27.4 25.5 7%

All 2021 financials are pro forma, incl. Smartbroker AG consolidated from 1 January 2021 E: estimate | CAC = client acquisition cost

2022 Preliminary Consolidated Balance Sheet

Cash and equity respectively represent 37% and 67% of balance sheet total

Assets
in €m 31.12.2022 31.12.2021 % of total
Fixed Assets 36.9 40.6 50%
Intangible Assets 33.7 37.5 45%
Tangible Assets 1.7 0.9 2%
Financial Assets 1.5 2.2 2%
Current Assets 36.4 34.4 49%
Inventories 0.0 0.0 -
Trade Receivables 6.1 7.0 8%
Other 2.9 1.9 4%
Cash & Equivalents 27.4 25.5 37%
Prepaid Expenses 0.8 0.4 1%
Total Assets 74.1 75.4 100%
Equity & Liabilities
in €m 31.12.2022 31.12.2021 % of total
Equity 49.9 49.5 67%
Provisions 4.0 6.1 5%
Financial debt 14.9 5.7 20%
Trade payables 3.0 8.9 4%
Other liabilities 0.4 1.9 1%
Deferred Income 1.2 2.3 2%
Deferred Taxes 0.7 0.9 1%
Total Liabilities 74.1 75.4 100%

Outlook 2023

Planning Assumptions

TRANSACTION

  • Market launch of Smartbroker 2.0 mid 2023
  • Subsequent migration of existing customer accounts
  • Successful completion of migration will entail loss in customer accounts, smaller loss in assets under custody
  • Trading activity not weaker than 2022
  • Double cost base plus one-off migration costs

MEDIA

  • Advertising market to remain stable
  • Growth in line with the market maintain established market position = low single-digit year-over-year growth of advertising revenue
  • Diversify media revenue with new income sources

Guidance 2023 Last Bridge Year Before Smartbroker 2.0 will Provide Full Year Contribution

Revenue, in €m EBITDA before and after CAC, in €m

* Please note: 2021 pro forma HGB (German commercial code) revenue, incl. Smartbroker AG (previously wallstreet:online capital AG) fully consolidated from 1 January 2021; In accordance with MIS the FY2021 pro forma revenue would amount to €51.4m, without material effect on the EBITDA. E: estimate | B: budgeted, according to current company guidance | CAC: client acquisition cost

Mid-Term Goals

Transaction segment to become the main revenue contributor

Smartbroker to break even on EBITDA level in 2024 | After cost for 75k new accounts

Increase market share

Maintain price leadership and leading customer value proposition

Drive innovation for transaction & media | Onestop-shop for private investors to inform, learn and invest

Investor Relations Calendar

UPCOMING EVENTS (excerpt)

  • May 3 MKK Capital Markets Conference, Munich
  • May 15 Equity Forum, Spring Conference, Frankfurt
  • July Publication of the Annual Report 2022
  • September Baader Conference, Munich
  • November Eigenkapitalforum, Frankfurt

STILL TO COME

  • New research coverage
  • Non-deal roadshows in Germany, Nordics, UK
  • New brand experience to be reflected also on our corporate website

Smartbroker Holding AG Ritterstr. 11 | 10969 Berlin [email protected]

About | The Smartbroker Group operates Smartbroker - a multiple award-winning online broker, which is the only provider in Germany to combine the extensive product range of traditional brokers with the extremely favourable conditions of next generation brokers. At the same time, the Group operates four high-reach stock market portals (wallstreet-online.de, boersenNews.de, FinanzNachrichten.de and ARIVA.de). With several hundred million monthly page impressions, the Group is the by far largest publisher-independent financial portal operator in German-speaking countries and hosts the largest finance community.

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