OnMobile Global Ltd. — Investor Presentation 2020

Feb 6, 2020

Investor presentation

February 2020

This presentation may contain statements that contain "forward looking statements" including, but without limitation, statements relating to the implementation of strategic initiatives, and other statements relating to OnMobile Global Limited's (OnMobile Global or the Company) future business developments and economic performance.

While these forward looking statements indicate our assessment and future expectations concerning the development of our business, a number of risks, uncertainties and other unknown factors could cause actual developments and results to differ materially from our expectations.

These factors include, but are not limited to, general market, macro-economic, governmental and regulatory trends, movements in currency exchange and interest rates, competitive pressures, technological developments, changes in the financial conditions of third parties dealing with us, legislative developments, and other key factors that could affect our business and financial performance.

OnMobile Global undertakes no obligation to publicly revise any forward looking statements to reflect future / likely events or circumstances.

Agenda

• History and milestones
• Product portfolio
• Strategy FY20
• Financials Q3 FY20

The Global Leader in Mobile Entertainment

Global presence

1.68 BILLION CONSUMER REACH

81 CUSTOMERS ACROSS THE GLOBE

900 MILLION DIGITAL REACH

100+ MILLION MONTHLY ACTIVE USERS ACROSS ALL PRODUCTS

10+ MILLION APP INSTALLS

History and milestones

Rs 419 Mn

Incorporated asOnscanTechnologiesIndia		Name changed toOnMobileLimitedAcquisition of VoxMobili, FranceAmount: RsMn12: 1 Bonus Issueof shares	Global1,431	for Rs	Purchase ofIntellectualProperty ofMusic On, India43 Mn		1:1 Bonus Issueof sharesBuyback of4,000,000 equityshares.Amount Spent:Rs238 Mn, Avg.Price: Rs59		Voluntary open offerby Promoter, No ofShares:11,900,000.Amount Spent: Rs476 Mn, Price: Rs40/-Buyback of 5,800,000equity shares,Amount Spent: Rs442 MnAvg. Price: Rs76		OnMobiletakes activeGlobalLimitedrenews itsCharles Siroiscontract withtakes over asTelefónicaEspaña
2000		2007		2009		2011		2014		2017	2019
	2006		2008		2010		2013		2016		2018
	Rs1,300 Mninvestment byDeutsche Bank AG,Jade Dragon(Mauritius), andKings Road		Public Issue:10,900,545shares, RsMn@ Rs440 pershare	4,796	Registrationunder SpecialEconomic Zone,BangaloreAcquisition of		Acquisitionof LiveWire, USAfor Rs1,007 Mn		Buyback of5,600,000 equityshares. AmountSpent: RsMn. Avg. Price:Rs96	538	Acquisition ofApplandAB –aleader in gamesand kids apps
	Investments(Mauritius)Acquisition ofIT Finity, India for		Acquisition ofTelisma, FranceAmount: RsMn	801	assets ofDilithiumTechnologies,USA for RsMn	146

Investor Highlights

• Global Reach
• Dominating market share in Tones business
• Investment in growth products
• Emerging turnaround story
• Solid cash position
• Healthy cash flow from operations
• Debt free
• High dividend yield

Product portfolio

Suite of products

Strategy FY20

• Grow Videos
• Expand Games
• Leverage Tones
• Digitize contests
• Beyond operator wallet

ONMO videos

Proprietary & Confidential

Entertain yourself

With amazing curated content on your fingertips, your entertainment quotient will be more than now

Grow Videos

• Launched OnMo Kids for a large operator in Italy
• Launched a platform for voucher based subscriptions for OTT services provider in Spain

ONMO games

Proprietary & Confidential

Challenge yourself

With great games to challenge your cognitive abilities, your zeal will be more than now

Expand Games

• Gaming ecosystem launched for a operator in Austria
• Closed a deal for launch of subscription games club in Venezuela
• Launched pre-loaded games club in tablets with a world market leader (Production of 115 K tablets in Q3 FY20)

ONMO tones

Express yourself

With our ONMO tones, you will be able to express yourself and build meaningful relationships, more than now

Leverage Tones

• Extended digital RBT footprint by launching RBT 2.0 App for a large Indian Telco
• Extended Non-Telco wallet payment integration to all digital RBT stores by integrating with PWA
• Crossed 1M active installs of RBT 2.0 App in India
• First bundled ringtone with RBT launched with an operator in Spain
• RBT 2.0 App launched with a large telco in UAE

ONMO contests

Reward yourself

With grand prizes to win from our impressive trivia based quizzes, your enthusiasm will be more than now

Digitize Contests

• Launched contests with two leading handset OEMs in India, 200K+ users engaged monthly
• 4X growth in digital contests usage through promotion of digital contests to legacy users
• Launched 26 theme based contests in Q3
• Development & integration with multiple ad-networks for optimized ad inventory

Financials

Q3 FY2020 Key Highlights

Revenue: Gross revenue at INR 1488.4 Mn grew by 0.3% QoQ. Key product segments of Videos and Contests witnessed 4.5% and 19.4% QoQ growth respectively

Gross profit margins: Lower on account of higher contract acquisition cost for the quarter. Negating this increase, gross profit margins at 53.5% have remained constant QoQ

Manpower cost: Down by 5.3% QoQ. This is after accounting for across the board salary revision from December 2019. Exit headcount for this quarterstood at 702 as against 734 people last quarter

Operating Profit: Increase by 25.2% from INR 60.0 Mn in Q2 to INR 75.2 Mn in Q3. This is despite higher contract acquisition cost

Profit Before Tax: PBT at INR 98.3 Mn has grown by 38.3% from last quarter.

Profit After Tax: Multifold increase in PAT from INR 10.5 Mn in Q2 to INR 65.2 Mn in Q3. Effective Tax Rate is lower from 85.3% in Q2 to 33.7% in Q3 on account of decrease in deferred tax assets

Cash balance: Increase in cash balance from INR 2,344.2 Mn to INR 2,525.3 Mn; despite payment of dividend of INR 159.0 Mn. This is on account of better collection from customers which has resulted in improvement of DSO from 155 days in Q2 to 140 days in Q3

P&L Q3 FY2020

P&L(INR Mn)	Q3 FY20	Q2 FY20	% Growth
Gross Revenue	1,488	1,484	0.3%
Less Customer acquisition cost	(57)	(46)	23.0%
Net Revenue	1,432	1,438	-0.4%
Content	636	633	0.5%
Other COGS	58	57	1.4%
Gross Profit	737	748	-1.4%
Margin (%)	49.5%	50.4%
Manpower Cost	390	407	-4.1%
Severance cost	9	14	-40.1%
Marketing Cost	77	80	-4.1%
Other Opex	151	139	8.7%
EBITDA	111	107	3.3%
Margin (%)	7.4%	7.2%
Depreciation	36	47	-24.7%
Operating Profit	75	60	25.2%
Margin (%)	5.1%	4.0%
Other Income	20	22	-9.5%
Exchange gain (Loss)	3	(11)	nm
Profit before Tax	98	71	38.3%
Tax	33	61	-45.3%
Profit After Tax	65	10	522.1%
Margin (%)	4.4%	0.7%

Total revenue by geography (Q-o-Q)

Q2 FY'20 Q3 FY'20

Revenue by products (Q-o-Q)

Q2 FY'20 Q3 FY'20 INR Mn

Contest 4% 60

36% 532

61 Tones

Infotainment 4%

Cash position

INR Mn	Mar 30,2018	June 30,2018	Sept 30,2018	Dec 31,2018	Mar 31,2019	Jun 30,2019	Sept 30,2019	Dec 31,2019
Gross Cash	3,052	3,169	3,486	2,672	2,723	2,510	2,344	2,525
Less: Total Debt	-	-	-	-	-	-	-	-
Net Cash	3,052	3,169	3,486	2,672	2,723	2,510	2,344	2,525

Cash flow

		INR	Mn
Particulars`	Q1 FY'20	Q2 FY'20	Q3 FY'20
EBIDTA	71	107	111
-Operating non cash items adjusted	(4)	(2)	8
Operating profit before working capital changes	67	105	119
Working Capital Changes:
(Increase)/ Decrease in Trade Receivables	(78)	(206)	261
Increase/ ( Decrease) in Trade Payables	(207)	242	(79)
(Increase)/ Decrease in Other assets	(14)	(310)	163
Increase/ (Decrease) in Other Liabilities	27	101	(95)
Cash generated from operations	(205)	(69)	369
Taxes (Paid)/Refund	(27)	(69)	(54)
(Purchase)/ Sale of fixed assets	(17)	(4)	(1)
Acquisition of Appland	-	-	-
Dividend/Interest income/ Capital Appreciation	37	28	26
Cash generated during the period	(213)	(114)	340
Other Financing activities
-Finance cost	(4)	(23)	(14)
-Dividend / Tax Paid	-	(33)	(159)
-Others	-	-	-
FxImpact on Cash balances	4	3	14
Net increase/(decrease) in cash/cash equivalents	(213)	(166)	181
Opening Cash balance	2,723	2,510	2,344

Balance sheet

INR Mn	As at Dec 31st, 2019	As at Sept 30, 2019
Shareholders' Funds	5,635	5,525
Non-Current Liabilities	80	445
Trade Payables	2,111	2,154
Current Liabilities	998	990
Total Liabilities	8,825	9,114
Fixed Assets	352	372
Goodwill	783	738
Right to use Assets	148	160
Financial Assets	64	63
Deferred Tax Assets	527	553
Non-Current Assets	1,396	1,452
Cash and Cash Equivalents	2,525	2,344
Trade Receivables (Billed + Un-billed)	2,300	2,529
Other Current Assets	730	903
Total Assets	8,825	9,114

Ratio Analysis – Financial Performance

Ratio Analysis	Q4 FY18	Q1 FY19	Q2 FY19	Q3 FY19	Q4 FY19	Q1 FY20	Q2 FY20	Q3 FY20
Profit and Loss
Export revenue / revenue	78%	81%	83%	84%	83%	84%	85%	84%
Cost of Sales / revenue	46%	45%	46%	46%	46%	47%	48%	48%
Gross profit / revenue	54%	55%	54%	54%	54%	53%	52%	52%
Marketing cost / revenue	3%	4%	6%	7%	6%	5%	6%	5%
General and administrative expenses / revenue	14%	12%	12%	13%	13%	12%	10%	11%
Aggregate employee costs / revenue	29%	31%	28%	29%	28%	31%	29%	28%
Operating profit / revenue	0%	1%	3%	1%	2%	0%	4%	5%
Other income / revenue	3%	0%	2%	2%	2%	2%	2%	1%
Profit before tax (PBT) / revenue	6%	2%	16%	0%	3%	2%	5%	7%
Tax / revenue	3%	2%	3%	1%	2%	1%	4%	2%
Effective tax rate -Tax / PBT	49%	91%	20%	nm	51%	30%	85%	34%
Profit after tax (PAT) / revenue	3%	0%	13%	-2%	2%	2%	1%	5%
Operating cash flows / revenue	6%	8%	19%	-4%	6%	-14%	-3%	24%
Balance sheet
Current ratio	2.43	2.46	2.38	1.86	1.82	1.85	1.84	1.79
Day's sales outstanding (Days)	140	140	151	141	139	143	155	140
Liquid assets / total assets (%)	58%	57%	61%	51%	50%	55%	53%	55%
Liquid assets / revenue (%)	3.2	3.1	3.6	2.9	3.1	3.5	3.4	3.4

Dividend & buyback history

(INR Mn)	March15	March16	March17	March18	March19
Dividend Payout ( Incl. Tax)	197	195	188	190	191
Dividend %	15%	15%	15%	15%	15%
Buyback (shares in Mn)	5.8	-	5.6	-	-
Buyback amount utilized	442	-	538	-	-

Dividend Policy : 75% Dividend payout or 15% Dividend, whichever is higher

Equity Snapshot

Particulars	Details
Script code (on NSE)	ONMOBILE
Share Price (INR)*	31
Shares outstanding (in Mn)**	106
Market Capitalization (INR Mn)**	3,229
Net Debt***	0
Cash and Cash equivalents (INR Mn)**	2,525

Notes:

*Closing share price as on 31st December, 2019 ** Shares outstanding, Market Cap, Cash and cash equivalents as on 31st December, 2019 *** Net Debt as on 31st December, 2019

For any queries mail us at:

investors@onmobile.com