Verve Group SE (VRV) Earnings Call Transcript & Summary

Hello. Welcome everyone. Welcome to the Media and Games Invest Presentation. We have the CEO, Remco; and also CFO, Paul, joining us today. Before we start, I would have to read a disclaimer from Jefferies side. So the members of the media and press are not authorized to participate in this event. If you are from the media or the press, please disconnect from the call now. The content presented on this conference call is [ party ] to and now subject to the copyrights of Jefferies or third parties. You may not publish or otherwise publicly disclose the name of, or otherwise identify, a speaker in the event unless Jefferies commits it in writing. By attending this event, you agree to all of those restrictions. So thanks again, everyone, for joining. And thanks again for Remco and Paul to do the presentation. The floor is yours now.

Great. Thank you very much. Yes, welcome to Media and Games Invest. We would like to run you through our presentation, but I think best is that we start quickly introducing ourselves. Paul, would you want to start?

Yes, absolutely. So my name is Paul, CFO of Media and Games Invest. Studied loan finance. Worked afterwards for a Silicon Valley start-up company called Shopgate Inc. Did some equity fundraising there with the management team. I was then hired by UniCredit Bank for the newly formed tech team back in the days where companies like [ Zolemno ] and [ Telubriu ] I covered. And worked also very close with the ECM team there. And met Remco in 2017 when we refinanced the German bond of gamigo Ag. And in 2018, then I joined the group as CFO. And since then, I'm responsible for finance, controlling and investor relations.

Yes. And then myself, I'm Remco Westermann, Dutch national. Studied economics, then started working in the oil industry, then went into consulting, strategy and consulting, having a restructuring practice for a few years after that. And then went into digital consumer media, amongst others, working for Sonera, the Finnish telecom, bringing Internet outside of Scandinavia. Then inside of Sonera, co-founding the mobile affiliate services part. Then in 2005, founding Bob Mobile, which is now called Cliqdigital, listed the company end of 2005, doing value-added services for mobile phones. And in end of 2012, I had the opportunity to buy gamigo, a distressed gaming company at that time, fully owned by Axel Springer, the media house in Germany. And that's where this story started. So via a buy-and-build story, we have been building Media and Games Invest now. We'll take you in this presentation through, let's say, our numbers, our background, strategy and a bit more. Current shareholdings, maybe to start with. I'm still holding 37% of the shares. We have early investors with roughly 15% of the shares. And we have a bit under 50% free float. We listed in -- on the Frankfurt Stock Exchange and on Nasdaq First North Premier in Stockholm, the latter actually only since a few weeks. And yes, we would like to take you through the presentation. Paul, can you go to the next slide, please? Yes, talking about the listing. So we did a secondary listing on the Nasdaq First Premier. We raised SEK 300 million, which is roughly EUR 20 million. First day of Trading was 6th of October. We were already listed on the Frankfurt Stock Exchange for roughly 2 years before. Seeing that the German investors, especially, have a bit of problems with small caps and there's no other gaming peers, we decided to go to Sweden, where we already had a listed bond, and also saw really a lot of interest in gaming companies and where we also have a lot of peers, of course. So we issued 25 million new shares. Now the total outstanding shares is 170 million. We're applying the Swedish corporate governance codex, quarterly reportings and all the likes. And yes, looking at valuations. So far, let's say, we still have a bit headroom to go compared to our peers -- closest peers, and yes, are working on that. Going to the next slide, you have the business overview. 2018, we started with the listing in Germany. That was when we basically got a share, which acquired 53% of gamigo at that time. In Q1 this year, now we acquired remaining shares, so we are now at 99.9% of the gamigo shares under Media and Games Invest. So basically, Media and Games Invest is the new gamigo. Grown well. EUR 170 million market cap. Yes, listings, I just said already. 650 employees. Majority of our revenues -- I mean we are a gaming company, and majority of our revenues are the so-called massive multiplayer games, games where many people are playing in parallel together with each other. And of course, where it is about, yes, social community on the one side; on the other side, having an exciting game. Games with very long recurring revenue streams, so it's a very interesting segment of the total gaming market. We also have over 5,000 casual games, which we mostly sell subscriptions, but also advertising base. Over 5 million players. We also have a media part, which we started a bit over 3 years ago. For gaming, there's 2 success factors. The one is, of course, content, and the second one is getting users or players into the games. So that's the reason that we decided to take our own media unit, which makes us much more competitive on the media side, having a lot of own media properties, but also compute technology and things there, and also working for external advertiser, of course. Looking at the revenues, yes, we have done a pretty nice ride from gamigo, which did roughly EUR 12 million in 2012. We have been able to more than tenfold the revenues now in the last 8 years. Last 6 years with a CAGR of over 40%, also with a strong growing EBITDA. So very happy with those numbers. And a bit about the geos. Over 50% of our revenues -- Paul will go more in detail, actually. But over 50% of our revenues are coming from North America, over 1/3 is coming from Europe and then the rest of the world, of course. We don't do direct-to-consumer distribution in China and North Korea. There, we use sublicense partners. Going to the next slide, that's giving a bit more an overview of the 2 segments. I mean it is -- are different segments, gaming B2C, media B2B. On the gaming side, 2/3 of the revenue, that's also the, let's say, a level that we would like to keep. In-game purchase is the main revenue driver, but also game subscriptions and advertising revenues. Here, you see some of the companies that we acquired. So we've been doing a buy-and-build strategy. We have acquired over 20 gaming companies now in the last over 6 years. We are integrating the companies, so what you see here are the brands. We're still using the brands, but behind the front door, companies are integrated. Just to get into the EBITDA. EBITDA target for our gaming part is 25% to 30% of revenues. We are currently at 30%, so on the high side. And also, let's say, what we earn, more investing in organic growth. On the media side, which you see on the right side, it's B2B, roughly 1/3 of the revenue is then money coming from agency fees, SaaS fees and ad commissions. Also here, we have -- we're running a buy-and-build. So we acquired more than 10 media companies, started with influencer companies, also afterwards starting adtech companies, buying adtech companies. A target EBITDA range here is 15% to 20%. We're currently below that. We just did some larger acquisitions. And as we also like to buy distressed, which takes a bit to get into the target EBITDA, the EBITDA is a bit lower at the moment. But we're growing into this very fast. Coming to the next slide. Yes, what's the philosophy or the business model behind the company? On the right side, you see it, it's the games. It's, let's say, recurring games. We get the games via either acquiring a company which has good games or acquire licensing and -- games and then launching them. We don't do new game development ourselves. To develop an MMO costs between EUR 5 million or EUR 50 million or even more. And let's say, we are too small to develop 10 or more games in parallel. And our philosophy is, if you can't develop more than 10 games in parallel, you shouldn't do game development because then it's more like a lottery instead of like a calculated business. So not ruling out that, when we are bigger, that we also start to do game development. What we, however, do, the games where we own the IP, we have internal developers that make sequels, DLCs, et cetera. So we do further development of the games, but we don't do new game development. And that's the other point. So once we have a license of a game that's running well and making good revenues, we're also making sure that we are trying to buy the IP. So out of our top 10 games, for 6, we own the worldwide IP, which makes the -- let's say, the possibility to get the game in a direction where we want it, where the players want it, a bit easier. And it's also, cost-wise, a bit more efficient. Then with those games, it's all about community management, making sure that the games are -- games and gamers are treated well and having fun. And then, of course, on top of it, getting new users into the game via our media companies. Going to the next slide. Yes, a bit of COVID. COVID has disrupted a lot of industries. For gaming, it was very good. What we show here on this slide, what you see in the middle, is the -- let's say, the number -- or let's say, the revenues that we made, 2020, well above this for Fiesta Online, a role-playing game we have. Just to show a few numbers, revenues are well above last year, which has also to do with content updates, the game growing revenue-wise, but also with COVID. And normally, we have a negative seasonality. So May is lower than June -- May is lower than April, June is lower than May. And here, we see really that we had a peak in May. What's more important, we've got a lot of new players in. And yes, especially the new players, of course, are also the revenues for tomorrow. So that's really driving also long-term revenues in a positive direction. In Q2, we had a lockdown in Europe. In Q3, we didn't. In Q4, we have again, or soft lockdown, at least. In the U.S., we had a lockdown all over, let's say, the whole period, basically. Coming to the next slide. A bit on gaming. Yes, gaming market, I think it has been covered in more presentations today. Gaming market is huge, EUR 150 billion, over EUR 150 billion, growing. A bit over 50% gaming, 1/3 -- sorry, 1/4 is console, 1/4 is online. It's a mass market. For example, here are some German gaming numbers: 42% of Germans are actively playing; female, 41%; over 50, 29%. So it's not the youth market that still a lot of investors assume that it is. Yes, megatrend, more leisure time, so there's more and more playing, what we also saw during COVID, but also in general are seeing. But it's also interesting market from an M&A point of view. It's a very scattered landscape. Low entry barriers for game companies to start. We have a few companies with billions of revenues, roughly 20, the Tencents, the Ubisofts, the Microsofts, et cetera. And we have thousands of small companies that often are too small to invest in technology or have one game that works and then the next one is a flop and they are for sale. So a very good market for M&A. Coming to the next slide. A bit about our revenues. On the left side, you see our spread of revenues. 50% of our revenues are our top 10 MMOs. The largest 2 are Trove and ArchAge: Unchained, which are a bit larger in, let's say, the last quarter because we're having large updates. The ones with the asterisks are the ones where we fully own the IP. Then we have another 14% of revenues with other MMOS, subscription games and advertising games. And we have 37% coming from the media side. How do we grow? First of all, via game launches. So we get games that are developed by third-party developers, which we launch. You see, that's not always successful, and we have a pretty good rate here. But game launches has a high risk level. I mean there's over 3,000 game launches per month. So it's really about picking the right games, and we are extremely selective there. The other way to grow, of course, and that's much less risky, is having big updates or big DLCs inside the games where we already have the gamers. And the 2 on the bottom, Trove, Trove Delves and Garden of the Gods for ArchAge Unchained were 2 big updates that we had in the games which are driving revenues very nicely. So organic growth, very important. And the second one, of course, is inorganic. We do 3 to 5 M&A transactions per year and are doing pretty well with that. Also there, we are very selective, and we have a slight preference for distressed, although also moving more and more into, let's say, EBITDA-positive companies. Next slide, please. Yes, a bit more details on the games that we are focusing on. Looking at, let's say, sustainable revenues have, of course, for a company, a much higher value than if you have to acquire your customer all the time again. That's the reason that we're focusing on MMOs, massive multiplayer games. Fiesta Online already just mentioned. It's a role-playing game, anime style. Yes, people are playing together in guilds. They also call each other, "Where were you yesterday?" So extremely sticky from the user base. And that's also what you see on the revenue side. So over 60% of the revenues from this game -- of our current revenues of this game are coming from people more than 5 years in the game. Another 12% from people more -- 3 to 5 years in the game, so extremely sticky. And typically, it's a free-to-play. So 7% to 10% of the people that start playing the game become paying users, and they normally spend on average EUR 50 to EUR 80 per month in an MMO like this. So we're talking about really substantial customer lifetime values. Also the game, yes, 13 years old. It sounds old. World of Warcraft is over 17 years old now in the market. So also, there is no end of lifetime as long as you treat the games well, updating regularly. And there can be larger updates, also graphic updates and those kind of things. This game has done over EUR 50 million in revenues already now since it exists. Going to the next slide. It's not a single case, so that's really how we like our portfolio to look. Desert Operations, 10 years old game, over 80% of the revenue from people more than 5 years in the game. Here, the graphics were a bit outdated, so we've done a full graphic update. Since then, also new players coming in. But old players wanted to continue playing with the old graphics, so there's also a switch button where, let's say, people can choose which graphics they want to play with. So it's also -- it's gaming as a service. I mean we are doing development very closely together with our gamers. And they also, of course, have their wishes, and it's very important as a game company that you listen to their wishes. On the left-bottom side, Deutschland-Spielt. That's a subscription service, casual game subscriptions. Also here, over 70% of the revenues coming from players more than 5 years in the game. And yes, there's a few more examples on this slide. But I would go to the next slide. Yes, media, the second part of the company. Also the, yes, market for media is growing substantially, 10% per year. We're talking about a EUR 350 billion market at the moment. Over -- a bit over 50% is taken by the giants, Facebook, Google and the others. There's still a very large open market, which is also very scattered, where there's also a lot of M&A opportunities, a lot of companies being too small. And there's a few trends going on, on the media side toward programmatic. That's one. The second one is that social media advertising is becoming much stronger, so influencers on Instagram, on YouTube, but also on Twitch. So there are trends. And for gaming companies, extremely important to, of course, be able to advertise the games well. And also, what's very fascinating that in the media part, there's pretty high margins. Margin estimations rank between 50% and 70%, which is very high and what we also see in our part. So the gross margin is very good on media, which of course, makes us much more efficient on new user generation. Next slide, please. Yes, the reason that we're doing this. It's interesting to do media standalone, but we see it as an extension of our value chain. So on the front side, it's media for user acquisition. And on the back side, it's really making more money from the ads that we are showing. On top of margin advantage, we also have a large advantage from the data side, so we can much better steer our advertising. We can already do predictive advertising, which means that before somebody is viewing a banner, there's a bidding process for the banner. And we will only bid if there's a good likelihood that one who's going to look at it will also later be a paying player. Coming to the next slide. Giving a bit of numbers. Hyper-casual games or casual games on mobile, a very important part of the gaming sector also that we're looking at, which is close also to the media part. Here, you see, let's say, a game stand-alone company, user acquisition, typically 0.15 cents per CPI in this example, or -- and making EUR 2 per thousand ad views. So you need 75 ad views to be breakeven on your user acquisition. If you do this as an integrated gaming and media company, you pay 1/3 less for the user acquisition and you get double the ad income. So you are 200% more efficient. And this, of course, is driving, yes, a lot of advantages in the market. Other nice company to look at, AppLovin. They seem to be filing for a IPO next year. They started as a media company, and then, let's say, started buying game companies like Machine Zone, was their latest acquisition. So really bringing media and gaming together is a very natural match. Turning to the next slide. Yes, also influencers are very important. That's where we started within the media side, especially for game launches; and for, let's say, larger updates, influencers are extremely effective. So here, an example. ArchAge: Unchained, a game that we launched, we used influencers very intensively here, over 65 influencer campaigns. And we were driving over EUR 10 million organic revenue growth, mostly via the influencers. Going to the next page. Then getting to the strategy. Yes, what's basically behind this all. Pretty simple in, let's say, the 3 points you see on the top side. It's a buy, integrate, build and improve strategy. We first started buying to just get critical mass. We continued to buy because there can still be more critical mass. Focus on distressed, but getting more on the positive side here. Then integrating the companies. We really believe in integrating companies because it makes the company much more efficient and also much more easy to manage, not having MDs on each of the companies. And then build and improve with the cluster to really grow via improvements of the product, via getting more players in and also via internationalization, of course. Coming to the next page. A bit on our M&A. So criteria for M&A. As I said, we have done over 30 M&A cases now in the last bit over 6 years. Distressed M&A, we want to earn back within 24 months. So that's the price -- the purchase price plus the burn rate, plus the restructuring cost. Typically, we are under 18 months actually. And if you buy EBITDA-positive, we want to buy below 6x EBITDA, which can also be 8x EBITDA because we're catering the synergies in. If there's enough synergies that, we in the end, get under 6x, it's also good. We have very well-detailed processes for the -- doing the sales process or the purchase process as well as for the integration process, which you see under 2 and 3. And we have an extremely well-filled pipeline, but are also limiting ourselves to doing 3 to 5 deals per year because we want to integrate them and we also don't want to overdo it. And it also keeps us sharp on being very selective in what we buy. Coming to the next page. Why are we integrating the companies? Here, an example. Typically, when we buy a gaming company, we have seen technology cost being 30% to 40% of the revenues, often in traditional data centers, often with a lot of spare capacity for the peaks. We are able to bring multiplayer games, which are not always easy because they're often run on several hundred servers into cloud. But that's -- we are getting much more efficient also by our size, we have a big cost advantage on the deals, also tendering the large cloud players against each other. And some of the effects you see on the right side, we acquired Trion Worlds end of 2018. We're able to decrease the technology cost on the monthly basis by more than 70%. And we acquired Verve Media, a media company, early this year, and we already were able to decrease the technology cost by over 50% and also actually [ IT ] to end up with over 70% savings. Next slide. Yes, to get -- look at total Trion. Trion was distressed, burning EUR 0.5 million plus per month. Based in the U.S. We acquired the company end of 2018, paid EUR 8.5 million for it, basically paid the money to the banks that had the secured assets. Then did all the integrations, all the optimizations, also invested EUR 3.4 million in the games. Yes, resulted already in the first 12 months after the acquisition is EUR 7 million positive EBITDA with EUR 19 million revenues. And the last 12 months, actually, a very nice increase, so a very nice organic growth, with EUR 24 million revenues at EUR 9 million EBITDA. Coming to the next part, that's mobile. Mobile, we are so far not very engaged in mobile. We were not very engaged in mobile. That's what you see on the right bottom side, only 1% of our revenues. Mobile is more competitive, especially on the user acquisition side. Also, Google and Apple are taking 30% of the cake, but it's a very big segment. So for us, it's natural to go in there. As you see on the bottom side left, we are, I would say, migrating our games to mobile to test the operations, also working on the mobile version of that and of other games. We have, by our media companies now, a lot of user acquisition power on the mobile side, which you can see in the left-upper side. And we have recently done a transaction. We have acquired freenet digital, which has a portfolio of over 1,500 mobile games, adding over EUR 30 million revenues on the mobile side. So also now bringing us, already in Q4, to 10% of our games revenues being on the mobile side, and further working on that. Going to the next, that's the finance part, and that will be taken over by Paul. Paul.

Thank you, Remco. So starting here with the revenue and EBITDA development since 2014. So here, we have shown very strong, profitable growth in the last 6 years. The CAGR, as Remco mentioned already, is 43% year-on-year. And therefore have also grown our EBITDA pretty strongly, from EUR 2 million in 2014 now to EUR 25 million last 12 months. Looking at the CAGR of 43%. Here, you can clearly see that, in 2019, was 85%; and also in 2020, with 64% total growth. We've outperformed the CAGR quite a bit. This has also been done due to an increased organic growth. So we increased organic growth from 5% in 2018 to now 16% in 2020. And this has been done due to more content updates, sequels, relaunches and much more focus on our existing games as well. And we also, in combination now with better user acquisition power due to our media companies, we have really leveraged our organic growth pipeline. And that's also one of the reasons why the EBITDA margin decreased. So the acquisition of media companies in 2019 diluted our EBITDA now to approximately 20%. While we currently working on bringing the media companies from 8% EBITDA margin to 15% to 20% midterm, and then we will also see an increase of EBITDA margin on the group again to 25% to 30%. And that was we have also set as a financial target, midterm. Then looking a little bit more on the gaming revenues in detail. So on the left side, you see that approximately 50% of our revenues is coming from our top 10 MMO games, which means very steady cash flows, recurring and long term. And 14% is coming from casual games, where we are also with subscription-based and therefore have also long-term, recurring revenues, where more than 50% of the revenues is coming from users which are more than 5 years already with the casual game platform. 37% media business, where, as Remco already mentioned, also a lot of software as a service revenues is included and therefore also long-term contracts, which means steady cash flows and low risk. Looking a little bit more on the group revenues by region. Here, we see that North America is now, by far, our biggest market with 55% of the revenue share, 34% Europe, 4% South America and 4% Asia. And on Asia, we're currently also expanding due to out-licensing deals. So we said we don't want to do any direct-to-consumer business, especially also looking at China and the regulation which is going on there, and therefore now have partnered up with Asian publishers. Which -- and signed the first big out-licensing deal, for example, for our biggest IP, Trove, which will then be translated also to Asian languages. And as we don't need to do these investments and that's done by the Asian publishers. We don't have any downside risk with a very nice upside potential as we get 25% to 30% of the revenue, depending on the region where the game is distributed. Looking a little bit more on the gaming revenue by device. Here, we see that 78% is done by PC client, 11% by console, 10% browser games and 1% mobile. And as Remco mentioned already on the Slide 4, we currently also did the first bigger acquisition within the mobile space and estimate that we will grow the mobile revenue share to 10% within Q4 already. And as we have also a very solid organic growth pipeline in the mobile space, for example, porting out Desert Operations also to mobile and then start with user acquisition, we expect also a very nice organic growth within our mobile portfolio. Looking a little bit more at the customer acquisition by channel. Here, we see that 78% of the customer acquisition is done in-house now within our very strong media unit and just 22% is done via third-party platforms like Steam, and that means that we don't have to give away the 30% cut like other developers which then rely on third-party distributors. And therefore, we have an overall better profitability within our gaming portfolio. Looking a little bit more on the licensed versus own games. Here, we see that we started with 50%, 50-50 share, in the beginning of 2019, and then have increased our license revenue share during 2019. That was mainly based on game launches, based on licensed games, as we don't want to take the EUR 5 million to EUR 50 million investment risk to develop such an MMO game, and therefore rather take a license, launch the game then in Europe and North America and also accelerate our organic growth with the strategy. In parallel, in 2019, we have also put much more focus on the further development of our IP-owned games and have now launched the first bigger content updates and DLCs. For example, Trove Delves in the first half year of 2020. And therefore, now the revenue share is going back to 50-50, and we see very nice organic growth in both verticals, licensed and owned games. Coming now to the operating cash flow and CapEx development since 2014. On the left-upper side, you see that we started with EUR 300,000 operating cash flow in 2014. Have grown our operating cash flow to more than EUR 21 million now the last 12 months, based on Q2. With an average cash conversion of 88% since 2014, which means a very strong cash contribution. And EUR 70 million free cash flow, which is also a very strong number from our point of view. Looking a little bit more in the definition of free cash flow. So there, we have operating cash flow minus maintenance CapEx. And maintenance CapEx is what we see on the right side. So maintenance CapEx means further development of our IP-owned games, content updates, sequels, relaunches to also get organic growth. And there, we have also, in line with our increasing organic growth, now invested more into maintenance CapEx. That's what we see with the increase, from EUR 1.4 million to EUR 4 million last 12 months. It may go up to EUR 5 million in the coming periods. But also looking at our operating cash flow of EUR 21 million, that means a very limited maintenance CapEx and a very strong cash contribution. Expansion CapEx is the other part. And there, we have investments in IP rights as well as M&A, have increased the expansion CapEx now within 2020 as we also, for example, did the Verve acquisition mainly in cash. And expect to trade -- that expansion CapEx is trending at EUR 15 million to EUR 20 million on a yearly basis going forward. And therefore, we have a very nice free cash flow, which we can invest in organic growth as well as M&A. And M&A is then also financed with equity as well as a mix out of debt. And that's what we have also done in the last years. So also using quite some debt instruments, like bonds. And here, we see also net leverage. So we started with 7x in 2014. We have then delevered pretty nicely to 2.2 by end of 2019. Then we had the opportunity to buy out the gamigo minorities in Q1 2020 for EV/EBITDA multiple of 7x. And then it was a clear decision by the management so that we will increase net leverage for short term and therefore take the opportunity and increase our stake in gamigo from 53% by end of 2019 to now 99.9% in Q1 2020. So net leverage has increased to 4.2, but we have -- we already knew that we have a very strong free cash flow and an increasing EBITDA. So we delevered already to 3.6 now within Q2 2020. And as we noted also the listing at Nasdaq First North did an equity raise of EUR 29 million, we have even delevered more to 2.2 and see also further deleverage going forward. Looking a little bit more at our financial targets. Here, we have set a net leverage between 2 and 3, and that's also what we have worked with in the last years with an exception in Q1 and Q2. And how we want to grow. So we want to grow with a revenue CAGR of 25% to 30% in the coming years. Looking at the 43% CAGR the last 6 years, we're feeling very comfortable with this target. Looking a little bit at the EBITDA margin here, we want to go again to the 25% to 30%. That's done then due to the more synergy realization on the media side as well as also further organic growth. EBIT margin will also increase then in line with the EBITDA margin to 15% to 20%, and that's also what we're feeling very comfortable with and have set then as midterm financial targets. Looking a little bit at our share price and also at the current shareholder list. So here, we see that we have grown more or less sidewards in the last year. And that's also, from our point of view, the main reason is that we have been the only gaming company at Frankfurt Stock Exchange. Now with the listing at Nasdaq First North and also some very nice successful gaming companies, like Stillfront, Embracer, but also more than 20 other gaming companies listed in the Nordics. We expect also that our valuations will pick up. Currently, we are valued at a EV/EBITDA of 8.7x. If you look at our peers, that's pretty undervalued. And what is very, very good now for us that we have within the capital increase, also a very good long-term Tier 1 investors on board, like UBS, which is now holding 4%; or [ Atlanta Opportunity ] as well as Nordnet. And therefore, we're really looking forward to build the company now within the Nordic markets. And now I would like to hand over to Remco for the last summary slide.

Yes, the summary slide. So just to summarize the things that we have been going through. We are a gaming company, but really geared for a fast growth, but profitable growth. So expect also the coming years to grow with over 25% CAGR. That's a bit lower than we did in the past. We don't want to overpromise, but we are also confident that we can at least to do this number. And targeting, and that's even more important, at the 25% to 30% EBITDA margin. How are we further doing this? It's continuing what we already have been doing, which is continue with a low business risk focus. So further concentrating on MMOs with steady, sustainable cash streams. Strong organic growth, very important for us. Gaming as a service, so with our games, updates, DLCs, but also game launches in the same categories. Then supported by the media unit. This is giving us a much more efficient user acquisition, so also helping us to grow faster. And as such, a clear cost advantage and a data [ use ]. Then synergetic M&A. So we did already 30 accretive cases. We expect to do more. As said, 3 to 5 is typically what we are looking at. We have a very well-filled pipeline. And then integrating the acquired targets. So not keeping them stand alone, but really make sure that we gain synergies and efficiency and use our economies of scale. This brings me to the end of the presentation. Thank you very much for giving us the opportunity, and I think it's time for questions.

Yes. Thanks, guys, for the presentation. It's quite comprehensive and also insightful. So I think we now have about 6 minutes for Q&A. And I actually got a question from the audience. So you guys actually invested in ReachHero and Mediakraft, so it seems like you have been focusing on the influencer marketing platform. So what's your expectation for this segment for the future? Are you going to expand the business further? And also, like how do you get your influencers to the platform or differentiate yourself between like other networks out there? And we also try to get a sense of how competitive is the business.

Yes. Influencers is an, let's say, extremely important part of the media mix. I think it's totally underestimated because still a lot of companies are only putting a little bit of test money in there while influencers really have proven to be extremely effective. Also for game launches, I said before, and also the example that was shown. So for us, it's important. We acquired Mediakraft, which was a management company for influencers. We acquired ReachHero, indeed, which is a company which has a SaaS platform. So -- and a platform where micro-influencers can be, let's say, booked and can be managed, et cetera. And that's what we're integrating in our whole media offering that we have. So it's an important part for us, but it's only one part because we also have an -- let's say, an adtech stack within our demand side platform, supply side platform, et cetera. So basically, on the media side, the idea behind it is that via our media, we can serve all the channels that we want to advertise games. And by doing that, we also, of course -- those services are also available to third parties, to other advertisers, which makes it even more efficient for everybody.