Verve Group SE (VRV) Earnings Call Transcript & Summary

Welcome to Media and Games Invest Audiocast with Teleconference Q4 2021. [Operator Instructions] Today, I'm pleased to present CEO, Remco Westermann; and CFO, Paul Echt. Spearkers, please begin your meeting.

Thank you. Good morning. I would like to welcome our investors, analysts and everybody else to this presentation. This presentation of Media and Games Invest will include our Q4 as well as our full year 2021 financials as well as our guidance for 2022. Also in the presentation, we will give insights in how we transfer the company from a gaming company to a ad software platform and we will end our presentation with our Vision 2025, showing you how we further want to develop the company. I would like to go to the next slide and start shortly presenting the agenda, sorry, one back, please. So parts of the agenda are a short introduction, business overview, our flywheel, overview of ESG, the strategy of MGI, our financial performance and the Vision 2025. Now we go to the next page, and we will start presenting the presenters. Paul, if you can do a quick introduction of yourself and then I will take over.

Absolutely. So Paul, CFO of Media and Games Invest, with the company now for almost 2 years, started loan finance, worked Controlling and Investor Relations start-up a little bit in Investment Banking, Metraco in 2017 when we did quite some financing transactions together and onboard now since 2018 and responsible for financing controlling and investor relations.

Yes. I'm Remco Westermann, CEO and Chairman, Yes, doing this for almost 10 years, October, it will be 10 years. Doing it with a lot of joy. Yes, a bit of background, studied economics, then started working in the oil industry, then consulting, and after that, setting up different companies. And since 2012 doing Media and Games Invest in the beginning it was gamigo. Yes, and a bit on the right side, you see our shareholder base. Happy to have Oaktree, Janus Henderson and a lot of really great investors on board. A lot of Scandinavian investors, also a lot of private investors, not to forget. And yes, the good thing that happened since you listed a bit less than 1.5 years ago on the stock exchange in Sweden on the Nasdaq First Premier North, yes, we have to say that we really have good access to capital markets, and as such, this is also helping us to grow the company. We'll go to the next slide. Yes, a bit of an overview, and this is just highlights. Paul will go much more into detail on the financials and everything. But I think to start on the left side of the slide. Yes, we are pivoted and I will go more into detail a bit later in the presentation, but we have pivoted from a gaming company to a software platform company, that is enabling monetization and acquisition of app and content developers. So the company really has made a large and a good journey in the last years. And that's also what you see about in the numbers. Yes, we did EUR 252 million of revenues last year with a 71% EBITDA. The revenue is an 80% growth against the year before. So it's the third year in a row that we've grown with over 70% year-on-year. And yes, very happy and proud to pronounce also that we are good on track on organic growth, and we did 38% organic growth last year. Also more details on that will be in Paul's part. Then a bit of an overview, but what else, over 800 employees out of those, over 55% are tech employees. And what we have been really able to do is growing our software clients, so people spending more than $100,000 on our platform to over 400, which is a 94% growth first the year before. And our total net expansion rate, which is a nice KPI in that sense was 172% -- that's over all our software clients. So really strong growth on the whole platform. Coming to the next slide, a bit about our reach. Yes, we are a global company with over 400 billion ad impressions, 1.7 connected devices that we reach and over 250 million daily active users. And if you talk about first-party content, which becomes much more and more important, much more important in the last years to reach people, do you really have access, where do you have first-party login's those kind of things, contents, we have over 5,000 owned games, over 20,000 connected mobile apps and over 100 million gamer audience. On the left side, you see our geographic spread and yes, 69% of the revenue in North America, 19% in Europe. I have to say and that's sad, of course, to say, but let's say, we are not because it has to do with Ukraine war, but our presence in Ukraine and Russia is below 1%. And so in that sense, we are not affected by it. But yes, all good wishes to the people there, of course. And what you see in the rest of the countries, we are spread, we have certain businesses in LATAM also in APAC going pretty internationally in here. Coming to the next slide. Here, you see the transfer transformation that we have gone through since we started this. October 2012 was actually the start of it by acquiring gamigo as a distressed gaming company from ExoSpringer. Then via acquiring more in the beginning, mostly distressed, but also more profitable game companies. Yes, we had a good track growing the gaming part on the gamigo. In 2018, we added the media part. So we said we are Media and Games. That's also when we did the listing in Germany actually, where we said, okay, to be a strong gaming company, we need to add the media part that's supporting the gaming part. That was how we started the media part. And then in 2020, yes, we formed the media part on the Verve Group. That was when we really started focusing on the software part. And since then, we have been growing a bit fast. And what you see here for us is the incredible growth we have done in the last few years and also very nicely in 2021 that we had a really nice quarter-on-quarter growth, showing the success of the combination of the 2. And then the latter part, what we see indeed is that from gaming first, we have become to media and gaming. And now we have kind of a media first where media is driving it, but where gaming is an extremely strong and important pillar of that. Coming to the next slide. That's bring us to the flywheel. This is how we try to simplify what we do or to really show in 1 slide what it is about. On the left part of the triangle, of the circle, actually of the flywheel, you see our platform, our media part, where we have a full vertical platform going for all different channels coming into that in a few minutes. [indiscernible] to data. And the bottom part is using those data, optimizing the ads by it and making the flywheel go. So those 3 parts of the circle are extremely crucial. And yes, it's a flywheel. So more first-party content, brings more advertisers, that brings more publishers, that brings more critical mass, makes us more efficient and makes the supply wheel spin, as we say here. Coming to the next slide, a bit about to markets. Yes, the nice thing or the good thing is, of course, that we are acting in markets that are both growing. Media and gaming, both substantial markets, the media is over EUR 550 billion now. Gaming is over EUR 200 billion market, and the joint growth of it is over 10% or 10% CAGR per year. Yes, doing it together, I said it's our flywheel, it's going faster, it's going better. So we did a 38% organic growth. Paul will go more in detail later. But just to give a few highlights on that, it's about efficient user acquisition for the games, placing ads on own games, leveraging strong synergy potentials between the markets and having the network effect with the flywheel, which has really been driving our organic growth faster than the market. Going to the next slide. Yes, what are the major events that happened in the fourth quarter. This is just a few highlights here. There was much more happening, many more things happening in the quarter. But we did 1 acquisition with MATCH2ONE, a Swedish company yes, really strong in, I would say, on the DSP side, bringing retail media, smaller companies, SMEs, et cetera, giving them access to ad tech, to advertising technology and a very nice, how to say, thing to add to our platform. Then cooperation is also very important. We are in the open Internet. We believe in working together. This is versus the big walled gardens like Google and Apple, et cetera. But in the open Internet they are many partners that we work together with very well. One of them is AppLovin. We connected to their MAX solution, which is giving access to, let's say, the AppLovin games, which, of course, adds a lot of games to our content and to our possibilities. Then another thing is -- other cooperation is with PubMatic, a big supply side platform, which has developed an ID5 solution, which we also came to a partnership and together with a media agency in Scandinavia, we were also able to show really good results in working together with them and with the ID5 solution. Then a partnership with Kubient, third partnership to mention here to reduce ad fraud. It's sad, but also in advertising markets, fraud is an issue. Things are there. And that's one of our prime focus is to really make sure that we prevent fraud and really deliver quality for our partners. Then on the gaming side announcement of Fractured, strong MMO, it's role play game, a fantasy game. Yes, looking forward to the launch and going to bring us more players into the games and also for our whole platform. And then also to mention on the casual game side, the thing that we haven't shown too much about in the past, but we did very well. A lot of game launches there. So casual games are really pay-per-play not as long as our prime games, but very interesting and very good launches. We did altogether over 350 launches in last year and out of those 90 in the last quarter. Then coming to the next page. Going into more depth in our ad platform, starting with, how do you say, the ad, the platform side, the public platform side. What you see on the right side is a bit showing what we do with the platform. So we have -- we are serving the demand side, and we are serving the supply side. And as such, we have a full vertical approach, which gives us a lot more transparency in the whole chain. With that, we are serving all different channels like mobile in-app, mobile web, desktop, CTV and digital out-of-home, so -- but that also enabling our advertisers as well as our publishers to use all those channels. And one level beyond that is all the formats. So we're serving from banners to video ads to interstitials and all these kind of things. So that's basically -- if you look about the platform, that's the philosophy behind it, and it makes the whole thing more efficient and, of course, makes it a one-stop shop for our customers, for our partners. Then we come to value add, very important because connecting is nice, but of course, we want to make it more efficient. And that is we're doing that by contextual and anonymized data. You see on the right bottom side, a few of the things we do on that and also a bit of the results. It's a world where identifiers are disappearing. So it's very important to work either contextual or to work anonymized on device like we do, for example, with ATOM. And yes, moments Moments.AI is our band for the contextual part using that with a really good results with the contextual and ATOM as you see below, it's just started, it was developed for 2 years. It's a really cool tool, and we're now starting to roll it out and bigger it gets, the more efficient it gets, but already the first results are very good. A few things to give on the left bottom. Important to mention that in our total ads platform, we have, let's say, a very strong mobile part in that part. So we're one of the top 5 mobile in app exchanges in the world, also our SDK base. So that's the app and the gaming apps where we are integrated is top 15 in the world. So we're especially very strong on the mobile side. That's what we also see on the next page. On the left side, you see the split of revenues over the different channels. So mobile in-app with 71% is by far the strongest. That's a very strong base. And let's say, more and more things are getting mobile and more and more things are being done on mobile phones. So it's a really good position that we have there. And the second fast-growing part in the environment, in the media environment is connected TV, shifting from traditional TV to connected TV. And as you see, we also there have a very strong position. We also do desktop. We do also digital out-of-home. So we are -- have the capabilities of it. We have also good connections there. But out of our total revenues, they are not that strong, but we're also here focusing on the part to grow. But with behind it, we serve everything approach. Yes. And then on the right side, splitting the revenues between demand side and supply side, we are more on the supply side, which means helping the publishers to make money with our ads. And we are, let's say, growing at the moment, also the demand side like we did with MATCH2ONE and we look also further acquisitions. This split, of course, has to do a lot with the acquisitions we did, but organically and nonorganically, we've grown both sides. But on the -- yes, inorganic side, on the M&A side, a bit more focused at the moment on the demand side. And retention rates are very important, 95% retention rate of our over 100,000 dollar accounts and 172%, I showed it before, net expansion rate. And yes, it's an incredible number, but over 400 billion ad impressions, which we served in '21. Coming to the next slide. It's a bit of busy slide, but this is basically how we see or how we position ourselves with our platform in the media part. Verve Group is, as I said before, it's a demand-side platform. It serves the data part and supply side platform. So combining those, but we are in an open environment. So we also work together with other platforms, with other data providers. And what you see on the left side, we're working for a lot of different advertisers, a lot of Fortune 500 advertisers for agencies, but also for SMEs and also, of course, for our in-house customers like gamigo, Wealth Engine and the others. And on the right side, you see the publishers there again, you see our own in-house customers, but also other game companies and also nongame companies and CTB companies, for example. 69% of our software clients are active in the entertainment and games industry. So that's where our main focus is. And that's also where the biggest market growth is. Coming to the next slide. Going now into the first-party part. So that's our games part. Basically, what you see here is the portfolio. We have a large portfolio of games. We have over 5,000 casual games. We do roughly 30 launches each month on the casual game site and we have approximately 20 million pre-installs. So this is a very strong base of games that we have and that we have access to. Then going to the premium games, mostly MMOs, massive multiplayer games, out of our top 10 for 8 we own the IP. Here, furthermore, a very important revenue stream is, of course, the in-app purchases, but also here, the ad part is increasing. But important, long-term revenue streams, so over 50% of the revenue is coming from people more than 5 years in the game. EUR 61 ARPPU, average revenue per paying user, a really substantial amount. And we had a 70% growth of players in the last year. So even after a strong 2020, which was because of COVID and everybody locked at home, a very strong year for gaming, we showed also in the year thereafter in 2021, a really nice increase of our player base. Paul will cover the financial part later. Over 100 million own gamers as an audience. Coming to the next slide, a bit about how do we grow this. So growing our first-party access is very important because it accelerates the flywheel. First, we have the casual games, as just mentioned, there's a strong pipeline. So roughly 350 game launches each year. We're even looking at if we can further grow that. Then on the premium game side, it's not so many game launches, but it's more about extending the games, getting more users in it, getting into other countries to other platforms, getting big DLCs to also get more activity of the users. And that's bringing us to a, let's say, really growing base. And on the right side, you also see that partners we're working with different ones like Big Fish, for example, new large games that we're going to launch and also not to forget, of course, the M&A part, which is bringing us also to more games and more access to first party. Going to the next page, which would bring me to the data part. Here first page of explaining why data is so important and why we made it the separate part of the flywheel. Data is basically solving the discrepancy that is between an advertiser and a publisher. Because advertiser wants the highest efficiency for each dollar spent and the publisher wants as much money for each ad space that he has, which is a seeming conflict of course. The only thing to solve that is via data. And with better data, with better targeting, the advertiser needs less ads to reach more and the publisher can just get higher CPMs or more value per ad that he serves. And where we are coming in here is that with the integrated channel platform, there's more transparency, which makes it better. We have the data enrichment via our first-party data, but also with contextual data and ATOM and then it's about scaling, data quality and transparency, which we are advocating here. Coming to the next page. So here, this is a bit about the disruption in the market at the moment happening. Most investors are aware that identifiers are getting out of the market. So Apple is taking IDFA out or, let's say, making it much more difficult to get data for the advertisers and also for the publishers. Google has now also announced that within the next 2 years, they will take all their identifiers out sandbox. So there's a lot of things happening here. And so far in the, let's say, old environment, if I may call it, so there were 2 ways to target. The one is deterministic. So I haven't identifier and it can target and I have high accuracy or I just shoot blind. I pay less per ads, but I don't know what I shoot at. Then we come to, let's say, the new environment, the way we see it and also the way we act. We have privacy first anonymized, which is our, as I said, ATOM solution, where we collect data of users, but it's privacy confirm and no data are leaving the device. So we work with segments, which has a very high reach and not a very bad accuracy, but a pretty good accuracy actually. And then we have, of course, our first-party data, which come from our own games also from our STKs in data primary connected in games and which gives us okay reach, but a very good accuracy. So this is basically how we see ourselves on the data part. Coming to the next slide. The flywheel in action because there was a lot of background theory. How does it look in practice. What you see on the left side of the column is basically how the media segment is often organized with a lot of parties in between where everybody takes this margin, where a lot of information gets lost, and we're in a world with identifiers at halfway worked, but -- which is totally inefficient. What we have with our combined platform, and that's what you see on the right side, if we work with third parties, we are much more efficient in organizing the chain. So the part that we have to take for that is much less. So it will be more efficient for the third party to work for, which is the blue part on the bottom. And what you see on the right side that if it is for our own games or our own internal inventory, it even gets a lot more efficient because then, of course, we also have the margin of the publisher in our own pockets. That's a simplified example also what you see on the right side to again show why an integrated media company is more efficient than a just stand-alone game company. A stand-alone game company typically pay EUR 0.15 for an installed for an app, would typically get [ EUR 2 ] per thousand ad fuse. Whereas an integrated media game company pays only EUR 10 and get EUR 4, which gives us 200% higher efficiency plus with a better visibility on data, it makes it even more efficient. So that's an important point, but going to the next slide. Showing how we work, for example, for direct publishers that are integrated by SDK, so our software development kit is integrated in those games or in their game apps, which allows us to show the ads, which also allows us to get access to the data that are available there, if there's an opt-in on the phone and, of course, helps us to help the publisher to make more money with it. We're serving a lot of games with that, and here is just a short selection showing that we really top-notch -- yes, serving top-notch games in the App Store and by that having also a very good reach. Coming to the next example on the next page. This is now the in-house example, so that's the second or the more right column on the 2 slides before, which is really showing that if you do advertising in our own game environment that we get an even bigger part of the whole cake, which makes it even more efficient and more profitable for us, of course. And that's also what you see or will see later when Paul shows the numbers on the EBITDA, so on the media side, we're also working with a good EBITDA, even though we serve our publishers and our advertisers much more efficient than the whole chain does. Coming to the next page, ESG. Yes, important topic, very important topic. We have a sustainability report that was published last year. And we are, of course, working on our new sustainability report, which we hope to present to you also very soon. And to just get some highlights here, and of course, ESG is very diverse. So from doing good things with, for example, where we use -- not used advertising spots for good causes, to planting trees or letting people plant virtual trees in our games and for each virtual, 3 plant a real tree, carbon neutrality, diversity and many more topics that we put emphasis on. Coming to the next slide. These are the things that are, of course, very much the focus of our investors, and therefore, I want to go a bit more in detail here. The one is the relocation process. That's an important point. We are still based in Malta or, let's say, our official domicile is a Malta. Malta has become on the gray list, et cetera. A lot of investors are not allowed to invest our company -- to invest into our company at the moment. So that's the reason that we have decided to go -- move away from Malta. First step that we did was converting from a plc into an SE, which allows us to move. Then we have done an in-depth latest which country to move to because just moving company is not as easy as moving houses. So we have, in the end, decided to go to Sweden after the thorough analysis. Many reasons for that, but amongst them that we are listed in Sweden already that we are familiar with the local capital markets and that we have a strong local network on the ground, also operations on the ground and already offices in Stockholm. Then the Board of Directors as such, has decided to propose the moving of the headquarters to Malta to Sweden that was also already communicated, and it will be in the invitation for the next AGM. And then the AGM officially has to, of course, decide on the moving. Target date for moving is the 1st of January next year because it doesn't make sense to move in the middle of the year because of having different bookers, different accountants and all these kind of things. So -- but still a lot of work to be done, and the team is working on it. Hand-in-hand or next to it is the governance structure. After now having decided which country to go to, we can also adopt our governance structure on the expectations of the Swedish market or also the rules of the Swedish market. So we will increase the number of Board members and establish a nomination, remuneration and audit committee. Also, these topics will be on the AGM, how to say, the invitation list. Then we will split the role of the CEO and the Chairman, also in line with that. So that's also next point. And then we have various additional measures to improve the governance amongst others optimizing the management structure, optimizing our internal control systems and of course, the publication of governance sustainability report which we have done, but will come again. And then continuous improvement of transparency and communication towards our investors and to our other stakeholders as well. Coming to the next page, the strategy, nothing's changed here. We further like to buy companies. So the M&A part is furthermore very important. What we buy, we integrate. And with the integrated cluster, we build and improve, which means we focus on organic growth. To go to the next slide, where we see a bit more about the M&A. I've done over 35 M&A transactions so far. Well-filled pipeline, as you see on the right bottom side and also very well-defined processes for this. Traditionally, we acquired a lot of distressed. If there's good opportunities, we still would do that. But there, we have a very straight rule that we want to earn back the purchase price plus burn rate plus restructuring costs within 24 months. Historically, we have done that faster. And then if you buy EBITDA-positive companies, we don't want to pay more than 10x EV/EBITDA. We have changed this number. We said always below 6x EV/EBITDA, which we mostly have done. That's including the synergies. But it is especially because we're now also focusing on more mobile game companies where the valuations are higher, we have changed this number. And as such, yes, we love sticking to the below 10x, which is still a very good number, I would say, in the market where sometimes crazy price update. This, however, also -- yes, as a consequence that we constrained in companies with EUR 5 million to EUR 40 million revenues per year, because companies that are much larger, they are the valuations often go sky high, and that's not what we want to pay for it. Going to the next slide. We integrate the companies that we acquire, a bit different from other people that are buying build models, but we don't want to end up with many kingdoms. We just want to have a lean company that can be structured in a lean way. So we either integrate on the gaming side or on the media side. And yes, there's huge gains, not only in the personnel side, but mostly also on the technology side from companies that we acquired often work with a pretty outdated structures on the data centers of expensive contracts, bringing those into hybrid cloud is making it much more efficient. And you see on the right side that, for example, Trion Worlds is a company that we acquired -- sorry, gaming company that we acquired, we were able to decrease the technology cost by over 70% on a month-by-month basis and deferred a media group company that was acquired by over 50%. So these are really big gains, of course, that make a good EBITDA. And you saw also on the EBITDA growth that we're doing pretty well there. Coming to the next slide, a bit about acquisitions that we did in the past also to, yes, show a few numbers here. Smaato, yes, very interesting media acquisition we did a platform was acquired October last year. And before M&A, it did -- it was a profitable company already EUR 33 million revenues with EUR 8.4 million EBITDA, our plan actually was to grow that when we did the acquisition to EUR 39 million, EUR 30 million EBITDA. And as you see here, we were even able to grow the company much stronger than that EUR 41 million revenues. So 26% organic growth, 63% increase in EBITDA what did we do? We reduced, for example, the IT infrastructure costs, the contracts that they had were not really that great. So we changed those. We're still working further on changing it. We also changed some things on the setup. And the company had 1 larger problem, which was a pretty high churn of personnel, and that was also a big attention point. That's not immediately a financial one, but of course, a very important one. So we're also able to make the team much more enthusiastic and to really reduce the churn structurally and substantially. The Nexstar Digital LKQD, another company that we acquired last year. It was loss-making when we acquired it. So that EUR 4.5 million revenues with EUR 2.2 million loss. Here, the plan was to make it roughly breakeven. Actually, we did much better than that. Also, the revenues grew much better than that. So we ended up with 5.1% revenues and 1.7 EBITDA. What did we do there? We also here reduce the technology, the infrastructure cost. We changed the model also for paying the infrastructures. So that was a big gain that we did. And yes, driving revenue growth, and we will see more of that this year is also by connecting the platforms. It takes a bit to connect technical platforms, but then you see really nice effect and connecting to Verve DSP really showed a good effect. And also vice versa, actually, also the other companies profited from connecting to the Nexstar platform. So these are 2 examples. Coming to the next page. A bit of our targets. Apart from strong focus on organic growth, we will further do M&A. We have a well-filled cash register, so there is money in the cash available to do further M&A. And here you see our top 5 targets. As always, a few words of warning because we show the targets every quarter. These are companies that we are working on to acquire them, which doesn't say that we will acquire them because there might be things coming up in the due diligence. We might, in the end, not agree on the price or on the contract terms. So those are things that can withhold us from it. As mentioned, we all want to buy them below 10x EV/EBITDA. Also, we're probably not going to buy a life then that would be a bit too much. But what you see here is 2 game companies. It's 2 mobile game companies. really nicely positioned. The one has racing games. The other has a bit wider portfolio, very interesting gain companies talking to those revenue ranges you see in the slide, [ one 7 to 10 and the other 15 to 20. And then we have 3 media companies that we're looking at, and I said before, it's mostly on the demand side that we are looking for further additions and those all demand-side platforms. Going to the next page. And that's the financial part, and I hand over to Paul.

Thank you, Remco. So starting here right away with the fourth quarter financial highlights. And here, we see that we have grown the revenues by 65% in the fourth quarter with a very strong organic revenue growth of 36%, reaching EUR 80 million revenues in the fourth quarter, EUR 23 million EBITDA and EUR 19 million EBIT, which corresponds to an EBITDA growth of [ 131% ] year-on-year and a 232% EBIT growth in the fourth quarter year-on-year. At the same point in time, we have been able to grow also the EBITDA margins from 21% last year to 29% now in the fourth quarter, where we also achieved a very solid EBIT margin of 24%. Looking now at the operating cash flow is EUR 31 million. Here, we can see that it is higher than the EBITDA. The reason for that is that we had a negative working capital effect in the first 9 months and then accelerated collection in the fourth quarter, and therefore, the operating cash flow is due to in working capital effect higher than the EBITDA and that also has led to a pretty strong cash conversion in the fourth quarter, which has been well above 100% due to the accelerated collection of receivables. Coming now into the -- going now to the next slide, 38, to the long-term financial development. And here, we see that we have grown the revenues now to EUR 252 million compared to EUR 114 million last year, with a very strong EBITDA of EUR 71 million and a very strong EBIT as well of EUR 55 million. While at the same point in time, we have been also able to increase the EBITDA margin from 20.8% to 28.2% and therefore, have increased the overall profitability of the group to the levels which we saw in 2018 again. And that's also due to the scaling of the media business, where we saw our margin improvements during the year. And now also with the synergies which we have realized where we accelerated organic growth substantially to now 38% for the full year 2021. That brings us already to Slide 39. So how did we grow our revenues. And as Remco mentioned in the beginning, we transformed the company much more from a games company to a software platform company. And that's also what we see on the left upper side. So the ad software share of the group revenues has increased from 44% in 2019 to 69% in 2021. That includes also the advertisement in our own games. So we are third-party advertisers like McDonald's, Burger King also place ads through our ad software platform in our own games. So that's included here in the software revenues, but it's fully automated and also shows the strong synergies, which we have realized over time now. And at the same point in time, on the right upper side, you see also the ad impressions, which have grown very much, and that's also somehow collected or connected towards our revenue streams. And here, we also see a very strong organic growth from EUR 15 billion ad impressions in the first quarter of 2020 to EUR 87 billion ad impressions in the fourth quarter of 2021, and that's fully organic growth. While on top, we also did the liquid acquisition and the Smart acquisition during 2021, which then on top have increased the impressions now EUR 173 million in the fourth quarter. And overall, we saw in 2021 of 4.5x growth in ad impressions, which is also then leading to stronger revenues. Furthermore, we also have increased our software clients by more than 400%, so 410% to be very detailed here. We show here the software clients, which is doing more than EUR 100,000 revenues on an annual basis on our platform because that are the really big clients. And here, we increased the total number from 102 clients in 2020. That's where we formed the work group to now 418 software clients and to also show some further KPIs in the details. We saw 172% net dollar expansion rate of our existing clients. That's for the whole software client portfolio. So also customers led with less than 100,000 revenues per year. We saw a very strong retention rate of 95% of our software customers. And also important to mention 94% of the software revenues were done by the clients, which are doing more than 100,000 revenues per year. And here, this number is pretty strong because MGI shows also that all the big blue chip clients, which we saw on one of the slides are really scaling with our platform and retailing. And therefore, we are well across the platform on our ad side now. Going a bit more into the details of one of our MMO games Fiesta Online on Page 40. Here we can see actually how we have managed to grow such a game also over many years now organically. So we did 18% organic growth in terms of revenues in 2019. Then we did a 49% organic growth in 2020. That was a COVID year where we also got a lot of new players into the game. And then on top, we have managed now in 2021 to grow that game 9% organically, due too much more content updates, but we also managed to keep the player stable. So we had a 2% active player increase. Important to mention here is that more than 95% of the distribution of this game is done via our own platform. So we don't really use and so on. And therefore, these are the numbers, which are showing the full picture of the game. Going now into the KingsIsle acquisition, which we also did in 2021. And as we have announced, is also well above plan. So we guided here a revenue of EUR 32 million for 2021 with an EBITDA of EUR 21 million. We have managed now to increase the revenue to more than USD 35 million and have generated USD 24 million EBITDA. And what we can see here is that the additional revenue is actually directly going into the EBITDA line because we have almost 0 additional cost of sales for that because it's a fully owned IP in our license costs and these kind of things. So therefore, we outperformed the guidance by 9% in terms of revenues and by 18% in terms of EBITDA. Maybe also important to mention that this will trigger actually another earnout payment of EUR 42 million, which we have also announced already in the recent quarters and which is also factored into the balance sheet from early on. Going now into the cost structure and how it has developed over time. So on the left side, we see that the purchase services, which is the cost of sales remained stable, that there are 85% in these are traffic and technology costs, as percentage of revenues. And at the same point in time, we have reduced as a percentage of revenues, our personnel cost from 17% to 13%, reduced our R&D cost from 11% to 9% and also reduced our other operating expenses from 13% to 10%. And that really drives profitability for the overall group. So we increased the EBITDA margin from 21% to 28% now in 2021. And also important to mention here, we have a lot of tech stuff. So 55% of the people are tech people. And therefore, we also have some R&D, which we do in-house and 56% of the R&D is really expansion CapEx. So further investments into further organic growth also for the coming years. And we will also show a deep dive now here on Page 43. So what we have invested in and what was also a little bit the investments into future growth. So we invested EUR 10 million to games content, which we here reflect as a maintenance CapEx. So that is big content updates into our IP on games. 81% out of this maintenance CapEx has been in the top 5 games. So that's Wizard 101, Pirate 101, Trove, Rift, Last Chaos and Fiesta Online. So that makes the majority of the games content investments where we also did EUR 24 million as an expansion CapEx investments into our software platform and new game licenses. So [ 90% ] of the expansion CapEx is in the end and to add software platform projects. It's like a hybrid cloud, but also many new investments into publisher SDK, so where we onboard a lot of new clients, which then have also increased their wallet share during the year on our platform and then 10% of the expansion CapEx is actually in new game licenses like Fractured where we also expect some nice organic growth for the coming years. Overall, we have outperformed the market with these kind of investments, which have actually also start also many years ago already, but we further invest into further organic growth. Looking into the games revenues. Here, we showed organic growth of 6% compared to an already very strong 2020. And taking the ArcheAge license, which we could discontinue out of the calculation here, we actually would have been well above 10%. While on the media side, we grew the revenues were 67% organically, and that's also due to a lot of new publisher SDKs, which we have implemented a lot of synergies, which we have realized. And also important to mention here, the 6% might look a little bit low, but it also enables a 67% organic growth on the media side because with all the data, the data enrichment, which Remco just mentioned earlier on, that was actually a big growth driver, having this audience in-house. And therefore, there's a lot of synergies which are not here in the numbers. And therefore, we are quite happy that we have started to realize much more synergies during 2021 and have also further invested into the full integration of both segments. Going now into the operating cash flow and CapEx development on Page 44. Here, we see that we have increased our operating cash flow now to EUR 65 million in 2021 with a very strong underlying free cash flow of EUR 55 million, which is achieved because we have a limited maintenance CapEx for the further development of our IPO games and that, in the end, leads to a very strong free cash flow. And on top, we did 2 very large acquisitions with the KingsIsle acquisition and Smart, which is the majority of the expansion CapEx. But as mentioned earlier, there's also a lot of investments which we drive to drive further organic growth for the coming years on our ad software platform. There's a lot of new products. And therefore, there's also a pretty good growth projects for the coming years. Looking now to the net leverage and interest coverage ratio. Here, we see that we have been able actually to keep our net leverage target between 2 and 3. So we ended up at 2.8. And by end of the year, we increased the net debt quite a bit because we also -- due to Smaato acquisition, nevertheless, well within our net leverage target of 2 to 3. And also important to mention here, it is just 4 months of Smaato here included so the pro forma net leverage is even lower. Looking at the interest coverage ratio. Also here, we are at 3.2x quite strong, and the increased net debt is then also covered by an increased EBITDA. And therefore, we have a very healthy leverage and also very strong interest-bearing capabilities. Going now into the actuals versus guidance 2021. And here, we achieved EUR 252 million in the group for 2021 which is at the upper end of our guidance of EUR 234 million and EUR 254 million revenue. So very happy with the development here. Well, on the EBITDA side, we have actually been able to outperform the numbers with EUR 71 million EBITDA, where the guidance has been at EUR 65 million to EUR 70 million. So therefore, we showed very strong revenue and EBITDA results for 2021. Going now into the guidance of 2022 on the next slide. Here, we see a little bit more complexity than usual. We have a revenue guidance of EUR 290 million to EUR 310 million and an EBITDA guidance of EUR 80 million to EUR 90 million. The complexity comes from discontinued businesses, which generated roughly EUR 20 million revenues in 2021. And therefore, taking that out, we just come to a 15% to 23% growth, but nevertheless, that's a large extent is that organically. And therefore, on a pro forma basis, if you would not have discontinued the operations, we would look at the 25% to 34%. So therefore, still very strong growth also on the guidance 2022. And on the EBITDA side, EUR 80 million to EUR 90 million EBITDA. Here, we see a roughly 1% increase in EBITDA margins. And that's also rather stable because we also want to do more investments into personnel to support further long-term organic growth, and that's how the 2022 guidance comes together. Going now into the midterm financial targets. Here we see a revenue CAGR of 25% to 30%. That remains unchanged. So half of it, we should say, should be organic, half of it should be M&A. We've outperformed that in the recent years. So we are rather conservative in our midterm financial targets. On the EBITDA side, 25% to 30% is also what we want to achieve here. An EBIT margin of 15% to 20%. And as I said already a net leverage of 2% to 3%, that's how we want to keep and grow the company over the coming years. And now I would like to hand over to Remco again for the Vision 2025.

Yes. Thank you very much, Paul. Coming to the Vision 2025. I mean, Paul has shown the expectations or, let's say, the outlook for next -- or for this year, actually, for 2022. And as in the past, also a few words of warning here, it looks, of course, like after an 80% growth, it's not so much growth, but we rather under promise and over deliver instead of, let's say, putting too much promises in here. There's a lot of changes in the market. I think we are really good positioned and expect us to grow also nicely in this year. But it's not only about this year, it's also about where do we want to bring the company and that is our Vision 2025, and that's what I would like to guide you through. So going to the next slide, Slide 50 indeed. This is the fundament of what we have been doing in the last years actually. So where do we stand now? First of all, we have a market opportunity. We're working in 2 markets: media and gaming, that both grow. That makes life a lot easier, but those markets also have, of course, there are challenges, there are opportunities. More things are getting digital. So that's really nice. So that's helping us in both markets. We see the, how to say, identifiers getting out of the market, which gives shifts on the gaming side as well as on the media side and gives also more credibility to first-party data. So basically, taking those things, we are in growing markets and with the setup that we have, we're well positioned in those. The second thing is platform growth. In those markets, we have a gaming and media platform and the more volume, the more efficient they get. That's what we have seen on the gaming side, where we were able to grow our EBITDA margin to 38%. And that's also what we have seen on the media side, which we started later, but where we also buy more skill have been able to grow our EBITDA percentage substantially. So more customers, more volume on the platforms make it grow. So the platform approach is very important. Then the third point, M&A growth. We have shown that with over 35 M&A cases now M&A makes sense. If you integrate it, if you manage it well, and bring it forward. Last year, we have stopped our influencer activities that were also investments that made sense in the beginning when we did them to, let's say, launch games what we had to realize that we couldn't scale it well enough. And that in comparison to the ad tech part, it was not growing fast enough. So that's the reason also here, a bit of refocus further on programmatic advertising, demand side, especially and further on mobile games because also that's where we scale most, but M&A and other important pillar for growth. And then the top of it, platform synergies, our flywheel really bring together the platform, the first-party data or first party, let's say, games and then the data part to really optimize the data part, that's really the ultimate flywheel, where we think we can grow this company for many, many years in the future also. That brings me to the next page, which is showing the flywheel again. And here, you see the flywheel as explained before. So it's the platform is the first-party content and it's the data. And here, you see also what we are focusing at. And I won't go through all the details. But basically on the platform side, it's really about adding more customers, more advertisers, more publishers and scaling them. It's about improving the platform, make it more cost efficient and a very important point. We are also working on open source because we want to leverage it also allow other developers, other parties to work on it to grow. And of course, we will strengthen that by further M&A. So we can do things organically, but also grow some things just faster by M&A. Then on the first-party content side, it's about launching new games, more games. It's about growing the SDK base. It's also about growing the game, so getting more users into the games, getting them more active by internationalization, for example, and also here further M&A. And then on the data side, it's about adding technology capabilities, artificial intelligence, for example, big data, really important topics because we're talking about a lot of diversity, a lot of things there that need to be handled that cannot be handled by just human beings, but need to be done by artificial intelligence. Then focus on contextual and ATOM, as already said before, and also here M&A. And then one point of the vision is what you see on the bottom. That's a kind of a result of the flywheel, which is a strategic opportunity that we see and that we want to drive forward and already are testing actually. We have built this platform, this ad software platform for ourselves, basically for our gaming side to become better on the gaming side, and we see how much value it is adding. And what we also found out talking to many of our partners that a lot of them want something similar. And not everybody can start buying an ad tech platform or a total ad platform, and as such, it doesn't make sense for people to build it themselves. People also don't want to just upload the data into Google, into Facebook for competitive reasons. So what we are really looking forward to is to have our platform also as a white label platform for partners. So for large game companies, but also for large retailers, for example, for like media agencies, it makes sense to have your own platform without building it, owning it fully. And that's something where we see a big opportunity also. That brings me to the last page of the presentation. And that's about, the headlines of our vision and also bring a bit more, sentiment in here and showing the 4 key pillars that we believe in for the next years. Number one has to do with people. What we have seen in the last years with a very enthusiastic team, with a very knowledgeable team, we have been able to build this company. And that's what we want to keep. We want to keep this entrepreneurship. There's really a good feeling in the company. So we want to be one of the most desired global companies to work for, which means embracing diversity, global node politics, professional, engaged, innovative strong drive to say a few of the words. But personnel, our team is extremely important for us. The second one, becoming 1 of the top 5 worldwide leading ad software platforms. That's just -- we want to be at the top. We want to be really there. And as the main things to get there, we see transparency as a very important point, open source, as mentioned before, innovative multi-format omni platform that's vertically integrated. Those are things that already partly differentiate us and will even more differentiate us in the future. Then the third point, respecting our partners' values and delivering transparency to clients. We see a market where there's more and more gardens. And of course, also we have the challenge that we have an in-house gaming part or, let's say, own games, but also work for other game companies. And that's something where we want to pay a lot of attention to that it's a fair play, which means that we're combining our own and partner strength, but that our partners also are owner of their own, let's say, data and that we have a content-based data sharing with the partners. And then the last point, that's what I just referred to before and strategic opportunity that we have, which might really, again, bring this company into totally different, how to say, levels which is building a white label SaaS and software platform where we enable other companies to have their own ad software without having to build or to buy it. And I think there's a big opportunity. So that brings me to the end of the presentation and to the questions. Thanks for listening. It was a bit longer than usual, but I think also good to give more details and to take you along on our journey from a gaming company what we started with to media and gaming and now to the flywheel and also giving a bit of outlook what we expect and where we want to grow the company. So thank you very much already, and I would hand over for questions.

[Operator Instructions] Our first question comes from the line of Ken Rumph from Jefferies.

I wanted to understand the extent to which the ad tech side of the platform is kind of finished in technology or where you want to add to it? You want to hire? Is that simply kind of more volume or people to cope with the business? Is it to introduce new services or new regions or add new customers? Or is it capabilities that you want to either hire or acquire for? And related to that, given especially the capital markets are kind of down and volatile at the moment, what's the sort of firepower that the company has available in that area?

Thank you, Ken. I'll take the first one. I think Paul wants to answer the second one. Yes, let's say, an ad tech platform is never finished because this market is changing, of course. You see the GDPR changes. You see MoPub, for example, being shut down in the market after it was acquired by AppLovin. So there's a lot of things. The data, the identifiers, et cetera, so it will never be finished. But from our base framework, which we wanted, which is full vertical, which is full, let's say, omnichannel, we are, I would say, 95% finished. So we're still looking at more DSP side things, but it's a lot of nice to have, not necessarily must have. And inside, let's say, with optimizations -- cost optimization, adding some features like, for example, ad boding, which is a technical term for CTP for bringing more ads connected to each other. There's always things that we are working on. But I think we are largely done with getting the whole platform, but we can, of course, make it a lot better. And we are indeed hiring a lot of extra people, first of all, just to cope with the larger size that we have. Secondly, we want to keep speed. So we have said, okay, we go with a pot structure where we have specialties per area, so for CTV, for example, to really drive that forward. And what we have lost a bit in the last month because of our fast growth, we had the credo of saying that 1/3 of our tech people are working on innovative projects. And all tech people are now more working on keeping these things running and bringing, let's say, getting normal growth in there. So innovation is at the moment, a bit suffering from just our fast growth. And that's very important in this market. So that's also the reason that we add extra people to get again an innovative and to really get more things going. And a nice example of the innovation was the ATOM, for example, that was developed. And there's many more things that we are having ideas where we can really differentiate the company. So that's also something that we want to do. So 2022 will for us also be a year where we will get a lot of, I hope, at least new things going on in the market and from getting level with the market, get maybe on some things really strong USPs to further grow. So I hope that answers your question, and then I would hand over to Paul for the financial one.

Yes. So coming to the firepower, which we currently have. So we have EUR 100 million cash on bank where we actually, I would say, have a pretty strong cash position also compared to some other companies to take advantage of some further opportunities down the line. And as Remco just have shown there's quite some targets, which we have in the pipeline. So we still have quite some cash, but we also will have an eye on that we don't put the company at risk. So not increasing our net leverage like [indiscernible] and keep our net financial targets. And therefore, yes, we are in a very good position now. And we also -- and I think what we have shown in the past as well have been quite creative also when it comes to structuring certain M&A deals, so small upfronts, higher earnouts and sometimes also having then the flexibility on our end at our sole distribution to say, okay, are we paying in shares or are we paying in cash. These kind of instruments could actually further leverage also the EUR 180 million cash, which we still have on the bank. And therefore, again, we have a pretty strong cash position and can take advantage of further opportunities also down the road.

Okay. If I could ask just 1 follow-up before you move on. And the business looks like in many ways, AppLovin or IronSource, are you also -- so are you in some ways, a partner of theirs as with AppLovin and Max as well as kind of European-listed analog of those companies. Is that how you see yourself?

Yes, we see a lot of similarities in there. It is indeed what they do. They also have the flywheel. They have their own content. They have ad tech part. And most of them also have the data part. So what we see there is also if you look at the numbers, really nice developments of things. ironSource is a bit different, but I would say a plain is the closest there. We don't see other substantial companies in Europe that are listed in this respect. And I think this model at all, there's not that many companies following it. There's more that are getting convinced that they should, but it's not so easy to build this or to buy all this. Not to forget that we're doing this now for, let's say, more than 4 years. And that's, of course, giving us a really, how to say, head start there against them. And yes, we will also work together with them because also they advocate the open Internet, and we have bigger, how to say it, other players in the market like the Googles and the Apples and Facebooks, which we wouldn't be, by the way, also party partner. But I think it's more the philosophy that counts, and they are AppLovin and ironSource also in similar things. We have a bit different view maybe on how you handle partners on the gaming side, and that's one of our things here, respecting our partner values, which is for us a very important to really get a very clear line between our gaming and third-parties gaming companies.

And the next question comes from the line of Philipp Frey from Warburg Research.

It's a bit of follow-up on, first of all, you've mentioned quite some organic growth drivers. And I would dare to go a bit further and basically order them in terms of magnitude, what effect you expect from the different growth -- organic growth drivers we have. And then get a bit of sense of, I think you rightfully mentioned that ATOM is getting better. And we spoke about it in the past. And I guess it's organically getting better from the installed base, basically and then probably also inorganically in terms of potential for corporations and so and what have you factored in as additional opportunities there for ATOM in your guidance?

Okay. Thanks, Philip, for the questions. Yes, organic growth drivers, it's difficult to say that it's not just one. I mean it's not like we launch one game, and that's driving 80% of our organic growth. So I would really say there's a good spread of different growth drivers. As you have seen in the numbers of Paul -- gaming has driven a bit less organic growth, but still very positive organic growth and especially against a very strong year 2020 already. But media was driving faster growth, but it's also the combination of the 2. I mean, gaming is enabling us to drive the media growth and vice versa. So in that sense, I -- it's not easy to say there's only 1 growth drive rate. So it's really in the multiple of them. And it's also, for us, some are more predictable than others. We have game launches, but game launches, as I've always said, is a portfolio approach required and you never know which one goes there. So we are very careful, and that's what I can say already with -- in our forecast or our outlook with, let's say, new things, be it a game launch, but also be it in ATOM. ATOM is something that has, according to our conviction, a lot of potential, but we have only taken a little of that into our forecast because we first want to see. And it's B2B, after all, B2B takes time and we see it now, it's a continuous iteration between improving the product, testing it, running it out, getting partners' views on it. There's a lot of partnerships we're talking about, some we have closed, but it's too early to really say how big the potential is, and we have been careful in our 2022 forecast of them.

So you basically more or less only model what's -- well, I guess with a longer period of the technology installed on an individual mobile device, you get better in targeting and things like that, something it's probably more what we should view as included in the guidance or something like that. Would that be the right approach?

Yes, right. Let's say we go more organic in our, let's say, guidance, which is saying the things that we have that we know where we can really say, okay, this is for sure going to happen. And as you have seen in the past, and I mean, that's, I think, our philosophy also. We don't want to overpromise. I mean we could give a much higher guidance if we put ATOM in at a huge number if we put the game launches in the substantial numbers, but we don't want to do that. We just want to be, let's say, a reliable...

Conservative?

Yes, more conservative on that. And I think that's what we stand for. That's what we are, let's say, sure that we will make. And if we can do more, we will, of course, do that.

And would you say it's -- in terms of organic growth, it's more that the synergies between your different media divisions, which you've now acquired and gaming is more of the driver? Or is really organic growth in the gaming side due to the new launches much more of a driver than it was in the last year?

Yes, the synergy for sure. I mean, that's something that we for sure can say. And the game launches could be but could also not be. And that's also, again, in our forecast. We are extremely careful in game launches. I mean, statistics are against game launches. And that's what we have seen with last years and with a lot of its effect. And so we do game launches, and we might be lucky. This sounds now a bit stupid because we have done a lot of prework and I don't absolutely -- don't want to categorize this. But game launches are dangerous. And let's say, the small games that do in the casual games, they are not that dangerous because they come into sitting, let's say, portfolio of games, et cetera. But if you talk about the larger game launches, they are dangerous and as such, also. We hope they get very successful, but we don't, how to say it, count on that in our forecast.

And maybe -- it's also just 10%, which we have invested into game licenses out of the full expansion CapEx. So it's rather limited. There is a nice upside potential from it. That's for sure. but that's something which will not have factored in -- really into our guidance. So we took a rather conservative approach here, but there is also some nice upside potential in there.

It sounds good and upside potential, one last one on that one. If I'm not mistaken, the influencer business, which we are now discontinuing was very low margin and probably you can remind us of what margin it was precisely. And so basically, should we view this as kind of growth investment is, as you obviously haven't increased the margin guidance going forward, just some thoughts on that side?

So should I maybe start on the...

Yes, you can start, and then I'll take over.

So it was a single-digit EBITDA margin, which we had on the discontinued operations, maybe to add here also on the guidance. So the 15% to 23% growth, that's to a large extent now organically because we were fully -- almost fully setting off the acquired Smaato revenues through the discontinued operations. So therefore, we actually think that the 15% to 23% is still quite strong. And therefore, we also have made in this kind of call out on the one slide, the 25% to 34% growth, which is on a pro forma basis. So that's more the real growth number to look at, and that's also then in line with our midterm financial targets of 25% to 30%, and that's a little bit how to read it. Did that answer the question or was there...

Yes, yes, I just wanted to make sure about this number...

Yes. On the EBITDA, which you were also asking, so basically on that side, our EBITDA forecast is also on the conservative side, we will see by bigger scale improved EBITDA. But on the other hand, as mentioned before, we will also add extra personnel to do more innovation and to also handle the larger volumes. And we, yes, I want also to give a bit more margin maybe to some partners getting larger partners, getting larger partnerships that will, let's say, also, we will want to pass on a bit of the advantage that we have in the chain, which will again drive growth out there.

And not to sound nitty gritty, but I'm definitely happy with the kind of organic growth you are writing, yes. Thanks a lot.

Thanks, Philip.

[Operator Instructions] We have another question from the line of Ellis Acklin from First Berlin.

Yes. And well done on the fourth quarter, and also thank you for the detailed presentation. Just 2 questions from my side. With the increased emphasis on ad tech, where do you see the revenue split between gaming and media headed? Is there maybe an optimized level that you guys have in mind? And as a second question, could you possibly give an update on the EG7 Stake?

Yes, I can take that one. For us, let's say, the split media and games, it has moved towards, let's say, more the media side, but in the end, we want to grow where we can grow. So if, for example, the game launch is very successful. We don't mind if the gaming part gets bigger again. Although what we see and also what you see in the numbers, the media part, but supported by the gaming part is the faster growth part that we have. So I wouldn't like to give exact numbers, expectations. What we also say, it is really an integrated company, and we want to see it like that and will grow wherever we have the opportunity. Then on...

So there's no level where you see that the flywheel effects getting out of whack if one part gets much too big?

No, let's say, I wouldn't like to see 5% or 10% of the revenues as gaming at 90%, that wouldn't make sense. So there will be in there. But if it's a 70-30 or 40-60 or even 50-50, that doesn't make a difference. Not on the efficiency...

Maybe to add 1 thing, it's also not just about the revenues. It's also about the data. So there's a lot of games which have a lot of users but not as much revenues. And there, we currently really look into the details what makes the flywheel further spin. And it doesn't really mean that we, therefore, need high revenue target on the mobile games acquisition, it can also be a small acquisition with a lot of users where we can show a lot of ads. So these kind of things are also not just coming down to revenues. It also comes a lot of down to data and the users in the games, and that's something where we really want to focus in 2022 to really make a flywheel more spin. And that's also the reason why we focus more on mobile games acquisitions and on top then also some further demand-side platforms on the mobile side.

And with regards to EG7, I cannot say too much apart from that we have these 8% in the company and that we are, let's say, at the moment, holding on to those but are also looking into what are the opportunities, possibilities that we have, but I cannot say more than that.

And we have one more question from the line of Sven Sauer from Kepler Cheuvreux.

Also from my side, thanks for the presentation, a lot of new details and information. I have 2 quick questions, one on the financial side and one maybe on the ad tech side. The first is regarding the guidance for 2022, you're providing an adjusted EBITDA guidance for 2022. And I was wondering what are the adjustments here? How high are they? And do you expect any adjustments on the EBIT level for 2022? And the second question regarding the ad tech side. You mentioned that -- I mean, the strength of MGI is SDK-based, and you have over 5,000 direct publisher integrations. So it's being more widely used in the market. But I was wondering, I mean, if I were a publisher, why would I choose MGI's SDK base compared to competitors? What are the attributes here? Is it price? Is it efficiency? Is it the bigger reach, the better? Or yes, maybe you could clarify a bit on that?

Well, you go with financial first, and then I'll take the tech part.

Yes. So you can account for roughly EUR 2 million to EUR 3 million on the adjusted basis, so onetime cost. There's also still some onetime costs, which might occur due to the discontinued businesses. While the major things have been factored into our -- and into the 2021 numbers, but it's mainly M&A-related costs or for the discontinued businesses. So it's EUR 2 million to EUR 3 million, which you can counter there.

Yes. And then to the tech part, the SDK base is indeed an extreme asset that we have. It's not the only one because, let's say, we have, of course, within the games, our first-party data also from, for example, the premium games, but SDK base extremely important, typically, let's say, and a mobile app wants to have not too many, but also not too few partners integrated there, like typically 5 or so because you want to have a certain bidding on your ads. And then it's about having SDKs that are performance so that are not endangering the crashes of the and those kind of things, and that are also giving access to a lot of advertisers and our state-of-the-art if it is about formats. And our SDKs that we have are extremely good, are extremely strong and as such, also recognized. And by that also, let's say, really liked by partners, which is not saying that we're not continuously also innovating on them and improving them. But I think that's one of the strong things that we have and, of course, having access to a lot of advertisers, including our own games, of course. So it's a combination of the things. But indeed, your observation is correct and having one of the top SDK bases in the world makes the whole flywheel go around again. I hope that answers your question.

And as there are no further questions, I'll hand it back to the speakers.

Yes, then it brings us to the end of the presentation. I would like to thank everybody very much. And yes, I hope or expect that we were able to give more details on the company, on the development of the company last year and also to give you much more an outlook or a view where we want to bring the company, where we're moving to. And as I said, our forecast is a careful forecast. We always like to over exceed that. But we also we don't want to overpromise. That's not our style. And yes, there is enough potential in the company. I hope that we were able to show that. Thank you very much, and wish everybody a good day and a good week, of course.

This concludes our conference call. Thank you all for attending. You may now disconnect your lines.