Verve Group SE (VRV) Earnings Call Transcript & Summary

A warm welcome back to everyone and also online. And yes, let's kick off this afternoon with the Games Portfolio. So I welcome Miguel up on the stage.

Hello, everybody. Welcome back from lunch. I would say I probably have the toughest job here today, which is to make sure nobody falls into a food coma today here after lunch. My name is Miguel Oliveira. I'm the CEO of the Casual Games business at MGI Gamigo. And even though it's called casual, it's really a very serious business. Today, you've heard a lot about MGI's flywheel. And I think I need to press the button to move on here. And you've heard a lot about the flywheel, especially through the eyes of our media team. This segment is going to cover the flywheel and its effects and the benefits mostly from a games business perspective. What does games actually mean for MGI? What does games mean for within the games business within MGI? As Remco shared earlier, we have a variety of game studios that MGI owns, amongst them, the gamigo Group with all of the acquisitions that have been made over the years. To highlight a few, AxesInMotion has been mentioned, the most recent mobile game, through the acquisition from a few months ago. KingsIsle, which was acquired last year, our MMO studio in Austin with properties like Wizard101, Pirate101, et cetera. And WildTangent actually the company that I came in through about April 2019. Overall, our company has a portfolio of a little bit more than 5,000 casual and mobile games. In addition to that, also 10 MMO premium role-playing and strategy games that we own and operate, out of which 8 are actually built on top of IP that we fully own and created. I will focus in my presentation on the mobile and casual part of the business; Jens Knauber, our CEO of the gamigo Group and also COO of the MGI Group, will focus on the MMO part of the business. What does our mobile and casual game strategy look like? There are basically 3 main pillars. First one is diversified monetization strategy. Second one is a synergy-driven growth approach. And the third one is betting on in-house mobile game development. Let me add a little bit more color to what it all means in detail. Within that purchase, free-to-play games, advertising, data and subscription-based monetization, we can tap into a very diverse complementary set of revenue streams that really help us manage risk, deal with fluctuations in the market, be it seasonality or consumer trends. It is a fantastic way to go with the trends, go with the direction where the money is coming from without actually being just cornered into one part of the market. As far as our growth strategy, at the end of the day, what this all means, in particular, is everything that we've talked about when it comes to the flywheel. It's reducing the cost on the user acquisition side, while at the same time, improving our monetization on the revenue generation side. I'll add a little bit more color to that, in particular, through some case studies and first-party data that we generated in just a few slides. And then third, but not least, we are consciously betting on in-house mobile game development. And this comes, in particular, because as a game studio and as a games company, gamigo has a long-standing tradition and history and track record of developing MMO games in particular. MMO games are extremely complex, very cost-intensive and bring some of the difficulties along that we know and learn how to master. When we looked at mobile, it's exactly opposite. Mobile game development is in general, especially mobile casual game developments, in general, less -- has a lower risk profile, is less complex and therefore, requires a very different and significantly lower investment profile than what we saw in MMOs. This was really encouraging for us in order to embark and embrace the in-house mobile games development. Now having said that, it's not enough just to bet on experience that we have and knowing that structurally, it's all possible. We're still adding additional variables to the equation that help us mitigate risk and improve our chance for success even further. One of them is our successful approach to tap into government funding processes and programs that further reduce our cash outflow and investment requirements. And above that, also our bet on licensing established IPs, which allow us to tap into existing audiences, again once more in order to drive the success chances of new games that we launch. I look at the room and I see a lot of finance people. So I think it's fair to assume that everybody has seen a P&L in their lives. On the left-hand side, we have revenues or cost depending on how you structure it. And then at some point on the other side, you end up with the revenue side. So you have costs and revenues. In mobile gaming or in gaming in general, you have the same thing. You have to acquire users, which is the cost side of the equation and then you have to monetize that user, which is the revenue side of the equation. Once more, we come back to the flywheel and all of that, as I mentioned earlier, we can use the synergies that we create between the gaming and the media side of the MGI business in order to drive higher chance of success, higher profitability and what we all strive for, which is organic growth. We have a few case studies that I would like to share with you. First-party data. In this case, we're talking about a hyper-casual game situation where on the left-hand side, you see, in terms of schematic outlay, our games catalog, pick a game. On the right-hand side, you see the audience, meaning consumers, gamers. And in the middle, like said, a variety of different gaming platforms. And when I say I stumbled for a moment, gaming because it's a PC gaming platform, it can be and is being used as such. So you have PC, mobile consoles, et cetera. When we ran those tests that I'm sharing with you here, we identified that acquiring a user costs maybe about EUR 0.15. Monetizing that user cost generates about EUR 2. When we take that stand-alone game, and we take that game and plug it into our flywheel environment, all of a sudden, the equation changes. And we've been talking about, obviously, how the media side of our business drives that benefit. The net result in terms of data that we found is that we ultimately see user acquisition drop from EUR 0.15 to EUR 0.10, and we see the monetization improve actually double from about EUR 2 to EUR 4. And again, use this all with a grain of salt. We're talking about specific case studies, use cases. It varies dramatically, obviously, by platform, et cetera. But these data points are the ones that we collected in-house. Once more, you take improved targeting. You combine that with improved monetization, you end up with what we all want, which is organic growth because that's what outside of M&A, acquisitive growth is what drives the engine. Another case study is a situation where we integrated advertising technology into our casual games business. And there, we took control of the entire stack, meaning from campaign creation all the way to advertising display and delivery. What we saw was that right from the get-go, the monetization that came in through our own sources, was already coming in at a higher CPM than what we saw with everything that we had already built in. Now the additional benefit is that it didn't just start at a higher level. It actually grew at a faster pace in terms of improvement as far as CPMs -- faster than the lower CPM revenue streams. Ultimately, that led to a scenario where by now more than 50% of our revenues actually come from our in-house sources, not because we force it that direction, but simply because it is what makes sense because it maximizes the monetization overall. As you can imagine, that's great for the games business because we're generating overall more money. But at the same time, also the media business is taking on far more revenue and being able to generate far more revenue from our in-house inventory than ever before. Now with all this data in our hands, we're super excited and looking forward to integrating all this technology into even more of our games, starting, amongst others, with emotion, as we mentioned a couple of times already before, our most recent mobile game studio acquisition. Talking about content, let me just share a little bit about our upcoming and current game portfolio and launch pipeline. We shared already earlier that Fantasy Town is our most recent mobile game launched. Very, very positive metrics that we've seen right from the get-go. Consumers are loving the game. I would claim that some of our employees are borderline addicted by now, which is a good thing is kept in control. For Q3, in particular, the publishing and product team is very focused on improving all of the key metrics that one would expect from cost per install over -- in that purchase through advertising rates and also overall customer engagement and retention. I am super excited personally because I'm a racing fan. Everybody, I'm sure, has their favorite jar and mine is racing. I'm really excited about Nitro Clash coming out later this year once more bringing up AxesInMotion, the most recent acquisition that we made. This game leverages the racing game expertise and combines it with a modern and very enticing card game play mechanic. So you end up actually attributing certain features to your cars and then having those cars race against other gamers. Coming out later this year, more announcements as opportune. For next year, looking into 2023, we have Golf Champions on the docket. And being a golf on myself, I have to admit, I'm super curious. I have not played it yet, lack of time, admittedly, even though I'd love to. Initial -- early-stage testing has shown really positive response from consumers and gamers when it comes to the variety of different golf-matching types and modes. So we're betting even more on that and really expanding that proposition once more, 2023, that is the game that we can talk about with the name attached to that. Last but not least, we have a Self Project. It's a 4x strategy game, a city builder where I would say, because we're gaming and gaming creates magic, and we make everything possible. We managed to have dwarfs and elfs and monsters all live in harmony. But obviously, that's your job as the gamer to keep them all in harmony. It's a city builder game looks already super fun, plays real fun and more on that as we go throughout the year and happy to share more press releases and announcements as we go. In addition to all that, those 4 specific mobile games, we always continue to deploy and launch new casual games. And we continue to aim to launch about 30 per month, and the plan is to maintain that at the current pace. And I think as far as I'm concerned, before the marching band shows up again, I am done for now. And I'll pass the torch over to Jens Knauber, our Group CEO, the new Group CEO, and MGI Group COO. Hold it this way because then you press the right button.

Yes, I learned it from Ionut already.

Thank you.

Yes. Thanks a lot, Miguel. Thanks a lot. Yes, you have learned a lot now about our mobile and cash flow portfolio and also a little bit about our strategy. And it's on me now to guide you through our MMO business because it work slightly different and lifespans of users are different. Also development strategies are different from what we do on mobile and casual. MMO business can also be called gaming as a service. Because once the MMOs launch, you really have a huge bunch of people working on it to keep it maintained, and you always deliver content update. But first, talking about the monetization. So we have different monetization models. First of all, we are free-to-play, free to play. I think all of you know it already, but it's the game access in general is for free and then the game monetizes either via in advertisement, although that's not very common in PC MMOs or console MMOs, but mainly through in-app purchases like buying swords, armor or boosters just to gain some time. Then we have buy-to-play. Buy-to-play works different. Buy-to-play, you basically buy the access to the game, so one bigger purchase in the beginning. And then usually, it also comes with a hybrid monetization that you still have some customization items in game where you just can then change your character, look or stuff like that. Then you have subscription-based monetization model. Subscription-based also can work different. First of all, the initial access to the game can be behind the subscription model, so that you pay month by month to access the game or what we have, for example, in Wizard101 and Pirate101 and is subscription-based combined with a free-to-play model, where the access to the game is basically for free and then specific parts of the game and specific contents of the game are monetized by a subscription model. So you still can play the game for free, if you like to, but if you want to have full access to the game, you need to, yes, get the subscription. And then in-app purchases, that basically accounts for all 3 models of monetization or free-to-play, buy-to-play and subscription. Our growth strategy. So first of all, reengaging players is really a key for us. We have a huge database of customers of players or former players. Whenever we do new content updates, offering anything new in the game, for sure, we try to reengage those players and try to bring them back into the game. Also with our combined with our community services. Community services, basically, what stands behind it, that's community management, social media management, also customer support. Then only reengaging players is nice, but attracting new players and customers is also nice. What are we do their portfolio expansions or we have portfolio strategy, bringing new games to the market. Internationalization means expanding games to new territories. And I also will show a case study, some slides later. And device expansion means if you were able to play the game currently on PC only, we will expand the game consoles or even mobile and that you have a cross-channel, multichannel experience. Development. Development strategy for our desktop and console games really works different than for our mobile games because as Miguel mentioned already, desktop and console games to develop them from scratch. In-house is complex, very cost intensive, takes a long time and you don't have any guarantee that it will work out. So all that together, you have a really high risk profile when it comes development games -- to develop games from scratch. Our approach towards desktop game -- console games development, no in-house development from scratch, but developing existing [indiscernible] games. So bringing into the games permanently, new DLCs, new items, new purchase, giving the player something to reengage with the game. And then to focus on licensing of strong IPs. This means in-licensed games from other development teams, a lot of them coming from Asia, where they have already launched their games in the Asian markets or in their territories. We have seen already KPIs for their market, so we can judge already better if those games also will work in our markets in-licensing them, publishing them. We have a resilient MMO portfolio, a dedicated customer based with multiyear relationship. That's an example of Wizard 101 coming from our acquisition, January '21 from KingsIsle, family-friendly MMORPG, which was launched -- first launched in 2008 and then still always getting reworked, also got a big traffic update in 2018 so that the game looks more modern again. Interactive, meaningful capital evolution and exciting fully voice narrative. So that also means that the whole game has voiced over. So if characters talk to each other or you talk to MPCs, yes, it's just with voice over. An extensive world coming with thousands of hours of diverse and engaging game content. What you can see in the middle, we have weaker in revenues. So 56% of our revenues are coming from players who are in the game since more than 5 years. That doesn't mean they spend money month by month. This just shows how we're engaging such a game. So sometimes they make a break over a couple of months, whenever we deliver new game content, they come back. And 15% -- also a very impressive KPI, 15% of all new players, which we are bringing into the game, are converting into customers over time. And this is possible due to multiple diverse points of sale as that we have a subscription model in the game, we have traditional in-game transactions and we even think we do retail packages, especially in the U.S. market, where we gain cards, but also some pluses and things like that. Substantial venue game generated since its launch more than EUR 450 million revenues, more than 55 million gamers play the games since then. And the target group is basically 20- to 30-years-old male and female audience. Not only Wizard101 or the KingsIsle games are showing this behavior, we also see that in our other games. So as an example, Desert Operations, which is a browser game, even 88% of the people of our customers since more than 5 years, just talked about. Fiesta, 69% and, Pirate101 52%. But what you also see here on that slide is that especially for Wizard and Pirate, the 1-year customer base is quite increasing compared to the others. That's after the takeover, we increased the marketing efforts again. So we are able to get new customers into those games and then transform them step by step into the, hopefully longer with us in 5 years bucket. Yes. That's one of the 2 case studies I'm going to show today, talking about geographical expansion. Also example is Wizard101 we have expanded into Europe. So the game was not published by ourselves in Europe when we took over the company. The game was published by another games publisher, European games publisher, which was for us resulting in a lower profit margin, which was for us and for the European games publisher office and for the players resulting in delays for updates when it came to updates for Europe because you have 2 companies working with each other. You have a lot of processes. For sure, there are also priorities to bring the update first on your old version and then to the other version. This always is leading to complaints from players. So what we did in May this year actually, we took over the game and we republished it in Europe. The corporation with publisher was really good and really helpful, really working together to take it over, resulting in higher margins, resulting in faster releases of updates in Europe. So the game is still 3 or 4 updates behind of the current version from the U.S. version, but we're going to publish that now throughout the year. And this was leading in total from April to May, you see it, yes, 220% increase effect on top line. And this is continuing. If you look at the numbers from July, August, you also see that trend is continuing. Next one is not a territorial expansion, but what happens if we improve game? What happens if we bring in game content? That's what we did to. We have just launched in June. In June, our biggest content update for 12 since we acquired the asset back in 2018 -- October 2018. The game itself was launched in 2015. And it's -- if you look at that sign over there, that's the game graphics. It's a voxel graphic, looks a little bit, yes, like Pixel, but it's really modern style. We acquired it in October 2018. Since then, we published 14 content updates since the acquisition. This was also many of those content updates, we are smaller, but also to learn because the games on consoles, Sony, Microsoft and Nintendo and to learn how that process works to go through the submissions also what's the need of our players, how do they react to specific content. And then last year, we started to work on the biggest content ever, had published in June '22. And the recent months since reported online shows highest revenues since we acquired the asset. Really great effort also from the teams working on that. So post M&A, QA 2018 compared to the last 3 months average revenue compared to Q4 2018 when we took over, we see a 46% increase in revenues. And the good news is the update was structured in a way that it's replayable content for players. So it's not like usual update, players played for 3 to 6 months and then they are done with the content. This update can be played and played not forever, but for a long time. Now I'll step on. Yes. We also are doing and especially have done the last 12 months since we met here last time a lot in our games. I'm not going through every single one now. But Q3 last year Aura Kingdom Whipmaster was a big update with new class. Fiesta Realm of the Gods, which was the preparation of an update for more updates. So it was a huge sanction with new level and everything. 12 console update, we did last year one more. We slightly moving update and really increased the player engagement a lot. We have seen that in the KPIs, [indiscernible] was celebrating the anniversary last year in December. And then in Q1, this year [indiscernible]. And in the second quarter this year, we have done already Wizard101 for the European server, the returns to KingsIsle and gamigo what I just talked about the big launch or the big 12 update I talked about. And The Return of the Battle Pass for RIFT. Battle Pass is an example of a subscription model. You have to subscribe for the Battle Pass once the month and then you get extra items on top. Those big updates are driving our revenues. And yes, we have done a lot in the past. We also will do a lot in the future. And very excited to talk a little bit about Fractured, Fractured Online, it's a license game. License game from a game developer from Italy, actually. And I met the guys almost the whole team last week in Cologne at gamescom. It's an MMORPG dynamic one, has 3 character classes. We went through some phases now closed beta, open beta. And we just announced that the 15th of September, we're going to go in early access. That's still not the commercial launch. So there's still some way to go until there. But early access is also coming with the steam release, and it comes with a huge content update. So the second world map is going to be leased to the early access. I hope I don't leak something now to the community. And there's also the last missing character class getting patched for that. Q4, also Realm of the Gods, new realm #4 and 5. So in between has been already realm #2 and 3. As you can see, first on Q3 '21 was the preparation to have longevity of those patch line, so to say. Then in Q3, '22 [indiscernible] update will come H2 next year, next new world expansion, which is a big one for Wizard101 will come. And then, yes, same as on mobile, we have one project in stealth mode. We call it Project H.A.M.M.E.R. That's not going to be the launch title. It's a licensed game. And yes, we are all excited about what did come and excited about what will come. And if you want to try some of our games, always welcome to do so. That was my last slide before I come later again. And now I would like to hand over to Sonja.

Thank you very much. Now let me -- so we have founded our robust business model on a strategy, which we have implemented for the past 10 years, basically. We call that strategy, buy, integrate, build and improve. As we already have heard, M&A has been integrated and to build and improve pillars of the strategy. On the integration side, the focus is on realizing synergies from past M&A. We do this by implementing cost-efficient management structures. Also technical integration is a very important part by moving individual service and tech platforms into connected platforms and the hybrid cloud. And obviously, there's more cost savings to be had. As an example, by cancellation and/or renegotiation of contracts. On the build and improved side, the focus is on organic growth. We do this by improvements in products, services and technology and by various initiatives to grow existing customer revenues and add new customers, obviously, as well. And finally, internationalization is a very important topic by expanding existing products and solutions to new markets. So on the gaming side, one example would be Wizard101, bringing it to Europe, taking over the publishing, which Jens has just mentioned. On the media side, for example, one example would be, for example, the launch of Moments.AI in the United States. So let me maybe recoup again why M&A is not a priority. I think -- I mean, basically, the reasons are twofold. The first reason is that by the recent acquisitions and the acquisitions of the past, we now feel in a position that we have a very, very strong platform already. So there is no obvious parts, which would be missing, which would require to be added via M&A or inorganic growth in any way. The second reason, obviously, and Remco has already highlighted that is the general capital market environment. Markets have been extremely volatile. Public valuation is decreasing. Everybody is talking about the recession that adds further uncertainty and intransparency to what's going to happen over the next month and the geopolitical situation, obviously, is another part there. One further aspect, which I would like to highlight is that there still is very much a gap in valuation expectations when you look in particular at private market to transactions, which we have been very active in. And we feel that the valuation expectations of sellers there still haven't adjusted to the new reality. So while public markets have been decreased significantly, in private transactions, we expect valuations to further decrease. So that makes it also now not a good time for M&A. Furthermore, debt and equity capital markets, the way they currently are, it's difficult to finance M&A. And last but not least, and I think that's probably the most important point on this slide is that our net -- our own net leverage is already at the upper end of where we wanted to be. So we put a strong focus on deleveraging at the moment. So now I would like to go into an example of realizing synergies from past M&A by highlighting, again, Dataseat and AxesInMotion to acquisitions, which we did, and they have been mentioned many times because we are also excited about it. So Dataseat is a DSP start up with a contextual technology. It has shown significant growth over the past years, fitting in with the high demand for non-identified solutions. And so what do we get from Dataseat? Dataseat obviously strengthens our DSP segments and add more advertisers and additional tasks to our platform. And what this Dataseat get from us? So how can we propel data seed is we can allow to upsell to have access to further data segments and our first-party data. More game advertisers, plus we introduced a global demand via our global platform and global reach. On the gaming side, AxesInMotion, it's a leading free-to-play mobile games developer, which enriches our ad software platform with the first-party content that it brings. And with the over 800 million additional unique users, that's, I mean, a huge number. So what we get from AxesInMotion is additional first-party ad spaces and data enrichment. And what AxesInMotion gets for us is a more efficient user acquisition and an absolutely better monetization of its advertising space. That's an aspect which Miguel has already highlighted. So that is the flywheel. And if we look at both those companies, so Dataseat has shown an organic growth of 63% over the last 3 years annual growth. AxesInMotion has shown a growth of 36% over the last 4 years annually. So putting that together, we believe that the growth can even be much higher by making the flywheel spin here. And now it's my absolute pleasure to hand over to David.

Thank you, Sonja. You have to hold it that way around?

Yes.

Thank you. And good afternoon, everybody. And thank you for welcoming you here today. As said, my name is David Philippson. I'm the Co-Founder and CEO of Dataseat and as the newest member of the MGI family. I've been asked to give a 10-, 15-minute presentation on what we do and what value we add to our clients and what kind of growth we can expect in the future. So what do we do? We are an in-app transparent privacy compliant DSP. And we work with advertisers that are trying to promote their apps. We help them drive user acquisition, retargeting cross-promo campaigns. But that's more the headlines. What I'd like to do is tell you a bit more about myself and my co-founder and why we created Dataseat. Because I'd be honest with you, when we started Dataseat, most people thought we were crazy. So I want to explain to you a bit more about who we are and who Dr. Paul is before going into a bit more detail. So my entrepreneurial journey started 12 years ago, but don't worry, I'm going to stick to my 12, 15 minutes. So I started a mobile media agency in 2010. Now that was a significant timing because that was 2 years after the first iPhone had shipped. I only had 2 clients, but it's fortunate that these 2 clients were the first big advertisers in our industry to be promoting an iPhone app. And there was no way to track a download in 2010. And this is when I met this gentleman. He's a PhD from Oxford. In fact, he was lecturing at Oxford University when I met him. And I appeals to his entrepreneurial side and encourage him to quit lecturing and come and join me, and we created a business called Ad-X Tracking. And for those of you that are familiar with more of the details of the industry, that is what is called an MMP, or mobile measurement partner, or an attribution platform. Again, somebody is more familiar with some of the names just is an MMP. They started off for us at and bought them for $1 billion. There was Appsflyer, Kochava and Singular. So it was Paul and I that really kind of started that segment in the industry. Now we sold that business to a company called Criteo in 2013. I became the General Manager of Mobile Solutions at Criteo. And Paul and I were tasked with building Criteo's in-app retargeting business. So I think it's fair to say up to that point, both Paul and I have done our Malcolm Gladwell's 10,000 hours in all things, attribution and programmatic and also spending a lot of time studying Apple and trying to predict their next significant moves, which influences our industry so greatly. Now interestingly, towards the end of my tenure at Criteo, Apple made their first significant move in privacy. And again, those of you familiar with the detail, they introduced ITP, or Intelligent Tracking Prevention 1 and 2. Now ITP was limiting the effectiveness of first and third-party cookies in the Safari browser. Now that was important to us because it led to a hypothesis, which was -- it would make no sense for Apple to limit identifiers in the Safari browser and not limit identifiers in the app store, which is significantly more important to them. So our hypothesis was that IDFA would disappear. And that was in 2018. Again, everyone thought we were crazy. They would never do that. That really hurt Facebook. That will really be bad for all these app developers. Well, we don't think Apple care, which is why we then kind of started and embarked on our own journey. Now why is this significant? Because starting a mobile DSP in 2019, 2020, it is crazy, unless there's a significant disruption that occurs. It's crazy because it's now a mature industry. It's a mature industry dominated by very high-valued companies. So it's very hard for a new entrant to enter unless there is a significant disruption effects. And I'm going to explain to you why that is important or why we've been able to kind of navigate and grow through that dynamic. And it's because there's -- some of my colleagues have mentioned, but I just want to go through a bit more detail. There's 2 fundamental types of bidding behavior or your ability to predict the likelihood that an impression will lead to a return on ad spend events, it is behavioral or contextual. Now behavioral in the app world was very much driven by Facebook. And I could summarize it by whoever has most data wins. Facebook was able to gather data from all of their advertisers, from all of their publishers. And all of these other companies that were competing for the same media dollars, they had to do the same thing. Now many of these companies know a lot about your device. They would know how frequently you fly from Stockholm to New York, which hotels you book. Whether you use Just Eat or Deliveroo the or the Chinese or Vietnam foods and whether you use games or a dating app in the evening, all of that slid to very effective advertising, but all of that was very much dependent on a persistent identifier ability to build profiles. So our hypothesis was that, that would disappear, which would then leave you with contextual. Now the way I summarize contextual is what advertising used to be before these big ad tech companies got a hold of persistent identifiers. I would describe that as this is why the BMW would advertise in the financial times. Because contextually, it's a good fit. And so if they are whoever has most data wins, what we are and what the world is becoming, is you need to have the technology to advertise and learn. So we'll learn and our technology will learn that this advertiser is performing very well on this publisher on this day of the week, and this time a day with this creative. There's many, many more variables on this device type, on this operating system version on WiFi as post operators. So we learned that to drive performance. Now that was all the hypothesis. We've built the technology. We're crossing our fingers and then it happened. In fact, in June 2020, Apple announced that they were releasing IRS 14 and there would be an opt-out of IDFA, which basically meant it was largely disappearing. They actually released it on the 26th of April 2021. So that was -- had a significant positive impact on our business. And interestingly, Google have followed suit or at least they've announced they're going to follow suit. But why that's significant to us is because of all the technology that we're investing in and building and the traction we're gaining here is very much applicable to Android in the future. This is the last 2.5 years of my life. My X-axis is month-on-month. I've removed my Y-axis, but this does represent our revenue growth. I'll just give you a few time lines. This in January 2020 is when Paul and I had self-funded and built our MVP, and we raised seed funding with venture capital. Then the lockdowns happened in COVID, and we thought how do we scale a global business, but thank god we raise some money. And 6 months later, Apple announced that IDFA was disappearing. We were one of very few ad set companies in the whole industry, we were popping champagne corks. We were right. We actually see a way forward to our -- for our business, plus the majority of other or the we're going into disaster recovery plans. How the hell are they going to deal with it based on their profiling based technology. Now usually when Apple announces an operating system, it rolls out within 3 months. It was delayed and delayed and delayed, which for me was painful at the time, but it eventually was released in April 2021. Now all iOS operating systems take a few months to propagate. And this is what the -- and it also gave us time to fully bake our solution and which then led to us launching it in November. And since then, we have had 9 months of consecutive growth. And it was around this time I met Remco and in July just gone, we joined MGI. Now it will be a valid question for you to ask me, well, David, with a hockey stick like this, why did you sell your business? So I'll explain. Because for me, it was compelling. And we're pretty good at predicting the future. And my prediction is that a contextual DSP -- a successful future contextual DSP will have an SDK and store base gives you far greater creative control than just receiving bid requests from SSP. So to receive it from your own SSP, you have better performance, which then gives us this virtuous circle where our demand -- currently, we spend millions of dollars on all of these other SSPs outside of our own walls, but we can now start routing our media demand spend to Veran Smart SDKs which then helps them grow their SDK installed base, there base helps our performance. So there is a clear 1 plus 1 equals 3 just from here. But when you include the MDI flywheel that's been mentioned many times when you then start including, the data capabilities and the owned and operated inventory, it then becomes more of a 1 plus 1 equals 4 or even in the future a 5. And so there's clearly technology synergies, but that's not the only driver. As [indiscernible] founder, whenever you have a strong product market fit, that's not the only thing. You need to scale quickly and globally. So to be able to join a firm that has a global presence that has that has offices in multi-countries around the world with sellers on the ground, this increases our ability to accelerate our growth and eventually be successful. Finally, and I think this is another important thing from our growth. Now we made a strategic decision to focus on gaming. Now that was my decision. I wanted to focus on the biggest TAM, the most lucrative TAM is also the most competitive. We were fighting with the big boys, but it was a good decision because our bet was right, and then we had a good TAM. We've got some fantastic Tier 1 clients. But my point here is that our artificial intelligence, our machine learning capability, it knows no difference between an in-app game gem purchase or a burger purchase in a McDonald's app or a hotel booking in another app. So our capabilities are absolutely scalable across various terms. So those were the drivers of why we joined MGI in that particular timing. Now there are some other, what I would call, trade winds and tailwinds that are significantly in our favor. Some that have been mentioned today, but there are things that I'd encourage you as investors and investors to look out for. I would say, over the next 6 to 12 months, look out for Apple enforcing a ban on probabilistic attribution. That will be challenging for our competitors. It will be good for us. There was an article in Financial Times in December just gone, makes interesting reading. So Google have announced that they will be doing similar. Again, those are kind of macro, what I call trade winds, more industry things that are in our favor and what I call tailwinds when I'm talking is more about consumer attitudes and then brand attitudes. People care more about previously than ever before because of all the big headline data breaches that are going on. Brands, therefore, have to care more about privacy, which means that our value proposition resonates more than ever. And finally, I think now that we're part of MGI, our ability to execute on that opportunity. That is the end of my presentation, and I think I'm handing back over.

Yes. Thanks, David. Really forward-looking -- very forward looking to work with you together in the future and for sure, also the team. But one team, we are all of us also where we're forward looking to work with in the future is the motion, which I'm going to show you now. Our recent acquisition in our game segment. So you heard the name today a lot. And now I'm going to show you what's behind the name. It's adding critical mass and mobile gaming with strong synergy and growth potential. Why is that? So first of all, they have a strong games portfolio of racing games. Their biggest flagship title is called ECDS, Extreme Car Driving Simulator. So because it takes a long time to say it all the time, we shorten it with ECDS. ECDS comes -- was launched in 2014, but had some really major revamps. I'm going to talk later about that. It's a flagship title main revenue driver and is consistently delivering strong results since '14 until year-to-date. So downloads more than 480 million downloads by today, 88% of ex revenues are coming from ECDS and the game actually is monetizing mainly via ad monetization. So 87% of the revenues from Extreme Car Driving Simulator is coming via monetization. And very important U.S. as being the strongest market, that's why it's also a perfect fit of our work group. Car Stunt Races Mega Ramps is one game to mention in the portfolio. It's launched in 2019. It's a stunt racing game, also where we fund to play. It's an attractive market opportunity. Prototype development only took 2 months. That's why it's based on the assets of ECDS. That's why they were able to produce prototype in a very short time frame, bring it to the market. Downloads more than 30 million. Revenue share in total of AxesInMotion, 5% and 84% ad revenues. Then Extreme SUV Driving Simulator, it doesn't make sense to shorten that, launched in 2014 as well. It's recognized as best off-road simulator and it's really based of at real physics, also fun to play. Only available on Google Play so far. We are considering to port it to iOS, but we also have some fresh games in the pipeline. We only have specific resources available. So considering if we do it or not. But we have refloating the game already, and that means growing daily downloads from 25,000 to 100,000, an impressive number. 55 million download so far, 3% revenue share and 97% monetized via ad revenues. We have seen for Extreme Car Driving Simulator an explosive growth in ARPDAU. What does ARPDAU means? Its average revenue per daily active user. The time frame we are talking about all the time now is 2020, December '20 until December '21 when we compared. So we have seen on iOS an increase of 204% in-app revenues per daily active users and an ad revenue growth of 19% ad revenue per daily active users 2020 compared to '21. And you see here, the ARPDAU has increased by almost 40% -- 39% on iOS and 87% even on Android. Also on Android, 123% increase in-app purchase revenues ARPDAU and 65% ad revenues ARPDAU. IAP means in-app purchases. That's an explosive growth we have seen from '20 to '21. Why is that? That's what I'm talking now about. So first of all, company is founded in 2014. AxesInMotion is established. Extreme Car Driving Simulator was then launched already. Then they worked a lot on optimizing the game, published some more games, but also worked a lot on optimizing. So result rate strategy to maximize that, to maximize traffic. This was lean cost. So you see here whatever they did, it was leading to organic growth. Back in the days in 2015, the team had already 15 -- so the company had already 15 employees working on the games. Then they took 2 years to focus on scaling the existing portfolio. This means really optimized the graphic, how they appeal in the stores, how the onboarding of users is working, those kind of things. Then they were focusing for about on the operations. That also means how we're going to treat players? How we add content to the game? What kind of content do we add to the game? Where do we show ads? What kind of ads do we show? So -- and there you see a strategic way of how they were growing the game and how they were appealing the game. And then what they found out is that from 2014 to '19, 5 -- '18 Q4, almost 5 years went over. And they had a lot of learnings about Extreme Car Driving Simulator, also taken by the other games that we are launching. So they decided because it was their most promising flagship title to rebuild a game. This means give it new graphics, give it a better game play, which is increasing the usability, the first time experience when you enter the game. And this was leading to the growth which I was -- which I have shown here in that time frame. Yes, they launched that release of ECDS. And with that, the company reached new all-time high results, not only in downloads, but also in monetization revenues. So really well done by the team. But that's not all. So that's not the end of the funnel. We still have not only with, but also with the whole portfolio and the games coming up, huge potential to grow the games further. Organic growth based on scale and cost-efficient UA, user acquisition, keeping the full ad value chain in-house. Now it comes where we start to talk about the flywheel for AxesInMotion. So user acquisition. User acquisition is key. Company has not invested in user acquisition yet, and this was already generating more than 800 million downloads. That also shows how appealing the game is to the user and what kind of good position they have in the download in the stores. So there is a huge synergy potential via cost-efficient user acquisition, via our own tech stack based on MGI's demand side platform, Dataseat, what you just learned from David. In-game ad monetization. We have huge potential by cutting out the middleman in our ad stock as well as increased efficiency as value chain and content is fully in-house. That's exactly when we talk about the flywheel, that's exactly what we talk about. New game launches. New game launches, we're going to launch 2 more games within the next 6 to 12 months on about. So it's -- I played both of them. It's fun to play them, the prototypes already. And both of them are based on valuable insights from the previous games. And also there, when we launch games, we can accelerate the flywheel, traffic better data good for work and or AxesInMotion in that case. In-game item sales. You also have seen the majority of the monetization of the games currently is happening via ad monetization this will stay, but we still will make stronger in-app purchase part. This means we're going to include item shops. We're going to work with back end so that we also contract the users better, those kind of things. And we're going to leverage the know-how which we have in our MMO business where in-game item monetization is a very common thing since, yes, 15 years. We're going to leverage that knowledge together with the AxesInMotion team. So they are working together and get the best result out of it. And yes, strong potential to quote this revenue stream in the upcoming years. Content updates. That's very comparable to MMO. We still will deliver content updates also for the raising game portfolio of AxesInMotion in the upcoming months and years. And this will also grow the existing player base organically. Some highlights about the company itself. Yes, compelling portfolio of visually stunning highly viral racing games. So if you check out the games, they said some has a comic art style, but really good looking and somehow have a really realistic approach. Delivered record trading year top line growth in 2021, have a proven track record in building a massive audience worldwide without any marketing, so really only organic. And now we come and add our user acquisition on top. Strong vision to expand in-game monetization mechanics and to further diversify revenue streams. That's what I talked when I was talking about the in-app purchases. We have over 80% EBITDA margin. That's also outstanding, I would say, a really great number. Strong pipeline of new games and really highly experienced and dedicated management team. But here to mention not only the management team, [indiscernible] but also the full team. By today, they are a bit more about 30 people. They are located in Zevia, Spain. I've been visiting them a few times since March. 41 degrees, that's maybe not the best experience always. But the team is highly motivated, great people and really, really not only fun, but they are also very professional, and they have an idea how to bring the games forward and what are their next steps. So it's really nice to work with them. And the teams when they talk to each other, not only Verve and AxesInMotion, also gamigo, the people in AxesInMotion, great. Yes. 33% of the total revenues in 2021 were generated in the U.S. That so far important. Remco mentioned we are a U.S. company, but a majority of our revenues are coming from the U.S. That also comes from AxesInMotion. That's perfect for both. They are targeting their audience over in the U.S. And this slide, I just going to show short. And here we come to the flywheel. You have seen it a couple of days today. So first-party data from the games are going into the data enrichment machine. Then the data enrichment machine, scale distribution, monetization. This is leading to more relevant users, and this is just spinning itself. That's the perfect example how we spin our flywheel. On the right side, you see it a little bit summarized, efficient UA brings more users, SDK integration of Verve brings more first party data, monetization via Verve SSP brings up to 100% revenue increase by cutting out the middleman. And then in the end, our world-class U.S. audience in real time connected to U.S. advertisers. So it's spinning itself. And then last but not least, games pipeline. 2 games I've been talking about, jump over that quickly. Nitro Clash, it's a card-based game play, more in the comic style. What you're doing there is, yes, you change the racing tracks while you are racing. This means you also have to change the vehicles with cards and you then can boost the cards. This means you're not only -- not only have the racing cars, you also have like trains or boats or snow cars and so on, really exciting. It's fun. We have different game modes, solo game, leagues, time-limited events. Monetization beyond that, that's for sure is included in all those games is get new vehicles, upgrade them and buy a season pass, which is then more also going towards subscription and both platforms will be served, iOS and Android. Basic game play will be free to play. Drift Master, more realistic style. Yes, just drifting with your car, super fun also to play. I just can say, focus on realistic depth of drifting experience. Simplicity is critical. So there will be a single thumb control and intuitive actions. I think that's for the game audience very important so that really everyone can play it without study how to drift and also a wide range of game modes, solo leagues, time-limited events. You can play with friends, you can make something like groups, play with friends and compete against other groups worldwide. So a PvP element will be included and you do brokers through leagues and monetization will be the same as for Nitro Clash with season passes and those kind of things. We are currently between prototype and soft launch for both games. Excited to see them. And yes, as I said, again, I'm really looking forward to further work with the team in AxesInMotion. And that's my part for today. Thanks a lot for listening. And now Jenny is coming for a Q&A.

For a short Q&A session. So let's bring up the team. So -- and let's start with the room. We will have a very short Q&A session, and then we move on to Paul and Remco. And then I know we have analysts online on the phone. So we will make sure this one in between here will be a short one. But you're welcome with questions. Here we go, yes.

It's Fiona from Edison. When you were talking about Wizard101, you were talking about acquiring the European rights. Is it common for the rights to be segregated? Or is most of what you own global and therefore, you can do what you like with it?

Yes, this was a special case because we were not the original publisher of the game. So we took over the game. Usually, we do our core territories like North America, Europe, also partially South America ourselves. And then if there's an interest for other markets, we would look into out-licensing. Usually, we do Europe, North America, that's where all our offices are. We do it ourselves.

Danesh Zare, Redeye. You mentioned again that you don't do development for console and PC games. But considering the synergies you gain from mobile games where you have stronger synergies with the Media segment there, how much are you looking into porting popular PC games like Wizard101 for instance to -- or Trove for that instance -- or for that matter, to mobile?

Actually, good question. Actually, we do look into those kind of projects. For Wizard101 also for Trove, those are open world MMOs. So you also have to look from the technical aspect and also from the navigation, how you can port a joypad navigation to mobile. That's what the teams are looking into. And it's part of our strategy to expand devices. I cannot say no, we're going to do Trove or Wizard or both or none of them. But I'm sure at some day, you will hear something about that again.

And a quick follow-up on that. I mean you mentioned also focusing more on the organic growth. I mean, initiatives like that maybe might be more interesting if you dedicate less capital to M&A, for instance. Or could you speak maybe more about what you're focusing on for the organic growth?

In the gaming part now?

I mean, in general. I mean maybe porting or what else are you looking at?

Yes. Yes, device expansion is one thing for sure, but also portfolio strategy. So really launching 3 to 5 games roundabout per year. We have set up a launch department, which is prepared now working on the Fractured launch then jumping over to the new license game. So we're launching games, portfolio strategy, device expansion, and we are also looking for territorial expansions also, which also could include an out-licensing to Asia as an example for some of our games. That's mainly the growth drivers. And then combined with delivering for our existing games portfolio, constant content.

But Klaus, of course...

Exactly, yes.

More user acquisition and also more ARPU per user or...

Yes, KPI improvements.

Okay. Any more questions? No, I think actually we move on, so we come to the big Q&A session at the end. So thank you, everyone, and I would like to welcome Paul, the CFO, up on stage. So now we get the number crunching and the financials.

So welcome to the second quarter financial highlights. And starting here right away, it was a very strong revenue growth of 37%, which we saw in the second quarter, so very overall strong growth with also a very strong underlying organic revenue growth especially despite macroeconomic headwinds where we saw some softness in the market already, but we also overcompensated that by scale and also delivering a lot of ad impressions to end consumers, which we will show later. So we achieved a EUR 78 million in total revenues in the second quarter, a very strong EBITDA of EUR 21 million and a EUR 16 million EBIT, which means in terms of growth rates, 38% EBITDA growth quarter -- year-on-year in the second quarter, 47% EBIT growth. And also the margins remained stable. That was also planned despite also further investments, which we did. And also the overall cash flow was EUR 21.3 million was very strong and a very strong cash conversion also of 92%. So overall, a very strong quarter with a very strong cash generation for the MGI Group. That brings us now into the segment performance, and we have changed segment reporting in the first quarter to also now apply a more -- a reporting in the end, which is in line with also the transformation from a pure games company much more towards an advertising software platform with very strong first-party games content. And what we see here, we talked a lot about it today, is on the left side, the demand side segment, which were growing with 104% in the first -- in the second quarter where 76% has been coming from organic revenue growth, and there was adding new clients, scaling existing clients and also products like AxesInMotion AI, even they are still early stage, also brought a lot of new customers in and already saw very good results. And therefore, our demand side segment is growing very strongly, and we also expect that in the coming quarters to further strong growth, and it's not even Dataseat included yet, so that will also add quite nicely in the coming quarters. On the right side, we see the supply side segment, which we're growing at 32%. And that also includes our games now, which is adding also a lot of data and advertising space towards the SSP. And we also were seeing a very strong organic growth of 14% despite the fact that existing customers, and that's what we saw in the net dollar expansion rate, were rather stable with 98%. But as we were also adding 25 new publishers to the SSP side, we were actually also able to deliver a very solid organic growth of 14%. Looking now into the long-term financial development. And especially in these a bit more uncertain times, I think it's also important to look back a bit and to see where the company is coming from, where it is going to. And what we see here is that we have delivered very strong profitable growth now for almost 8 years in a row, always scaling revenues and always scaling EBITDA and EBIT. And we have achieved now EUR 287 million in revenues on an LTM basis with a very strong EBITDA of EUR 81 million and EUR 64 million EBIT and achieved the CAGR for the full group now since 2018 of 69%. And we also expect to grow further and therefore, also reconfirmed our guidance now for '22 and also see a lot of growth potential as we saw today in all business units, including the games, but especially also on the advertising software platform and the combination out of both of them. Looking now into our software clients and where a certain amount of growth of the company is also coming from. And here, we also see that the ad impressions, so the ads delivered to the end consumer in the end have constantly growing over the last years. And what we see here is in the end, the organic growth where we were growing from 15 billion in the first quarter of 2020 to 89 billion, and that's just fully organic in the second quarter of '22. And on top, we also added acquisitions like VGI CTV, but also like the Smaato acquisition. So in total, we now delivered 161 billion ad impressions in the second quarter, and we're off 60% where then coming from organic growth. But one thing -- and usually, that's also linked to revenues. But as also CPMs have been decreased overall in the market, and that's also what Remco mentioned earlier, we also saw that this is not fully translating into revenue growth. Nevertheless, we were scaling further. And as we also increased the ad impressions massively, we could also overcompensate the decreased CPMs and still generate a very strong organic revenue growth. On top, we also added a lot of new software clients, so 7% quarter-on-quarter. That's not year-on-year, that's quarter-on-quarter. So more than 30 new clients, which also then enabled us to further scale and grow. And that in combination with a stable net dollar expansion rate, which is also reflecting a certain softness in the market, also comparing to Q1, where we had 125%, et cetera, but also come by with a very strong retention rate of our clients. And then on top, also a very strong scale, so 131% ad spend growth, which means we increased volumes which are going through our pipes massively, even take rates, CPMs, et cetera, are decreasing. But overall, also our market share was increasing massively in the second quarter, but also important to mention here that also includes M&A and especially also the Smaato acquisition. Looking now to the seasonality. And yes, how especially after the transformation more from a pure games company towards an ad tech software platform with strong first-party games content. We also see a stronger seasonality in line with the programmatic advertising business. And usually, the fourth quarter, so the last quarter in the year is always the strongest because of holidays, yes, Christmas, Thanksgiving, Black Friday, all these kind of things. And then the first quarter, there you have a revenue drop of 20% to 30%. And that is also something which we saw this year. And in the second quarter, and that's I think also a very good proof for our growth, we almost achieved already the same amount of growth or amount of revenues as we saw in the fourth quarter. And what we can expect now in the second half of the year despite some softness in the market is that we further grow compared to the first half year. And that is also then supported by seasonality. So yes, all the Christmas and holidays which are upcoming in the second half year. And therefore, regardless of certain softwares, which we currently see, we also expect further strong growth for the second half year. Looking now to the net working capital development, and that has also changed quite a bit over the years. So we started as a games company in 2014 where we had a negative working capital until 2019, where we were mainly a games company, which means we have lower receivables than payables and have a positive impact also on the operating cash flow. That has changed quite a bit in 2020 when we also decided to step more towards advertising. And therefore, we have no more receivables than payables in the business, which is absolutely normal thing. So usually, you have 60 to 90 days to collect the revenues where you pay between 30 and 45 days the publishers. And therefore, you have a positive working capital. And we have now roughly EUR 50 million, which is also eating a certain amount of cash. But what we have mentioned over the last few quarters is especially that the net working capital compared to the revenues has been decreased. So we have really accelerated also the collection efforts and which means also it has a positive impact on the cash flow, and that's also something which we really want to put a lot of focus on because obviously, there's EUR 50 million cash sitting, which can also decrease the leverage over time as we further collect the revenues. Looking now at the MGI balance sheet, which is especially important in times with a bit higher uncertainty. And on the left side, we see the intangible assets. So almost EUR 800 million, which is the majority of our assets due the M&A transactions, which we have done over many years. And in the past, the impairment test was always done by Deloitte. As you know, moving to Deloitte, we now will transfer this task to EY. But also EY has a lot of experience with us because since 2018, they were doing all the M&A transactions with us, always doing the asset valuation and therefore, there will also be a very good handover at that part. Looking at the cash position, EUR 125 million. So we have a very robust cash position, but further focus now is really on deleverage. But it gives us a lot of buffer and a very good feeling also in this environment. Looking now at the long-term liabilities. And here, we see especially 2 bonds where we have also refined -- financed in the end our M&A transactions. So it's EUR 235 million bond which is maturing in November '24. So it gives us plenty of time for this bond. And then we even rolled over a certain amount of bonds and into a new bond, which was recently issued now in the second quarter of EUR 175 million, which is maturing in June '26. And therefore, we have now also diversified our debt and bond maturities and therefore, have also derisked the balance sheet. Looking at the earn-out payments of EUR 95 million, and there is EUR 80 million AxesInMotion included, which are mainly relating to performance targets like EBITDA. And these earn-outs will just become payable and if you would add another EUR 25 million EBITDA to the full group. So therefore, looking at the earn-outs, which also would become payable over a period of 3 years, they would pay in the end for themselves. And therefore, we also don't see an increase in leverage, even the earn-outs might come through. And yes, overall, very strong cash position. Net interest-bearing debt of almost EUR 300 million, but also a very strong equity ratio of 34%. Looking now into a few more KPIs in relation to our balance sheet. And on the left side, we see that we have managed in the last 5 years always to be between 2 and 3 in terms of leverage, which is also our target. We are higher now with 3.7x. Nevertheless, we have a lot of EBITDA growth in the coming quarters, a lot of free cash flow and expect that we are very confident about it, that we can delever to below 3x again on a midterm basis. On top and that's, I think, also very important to mention on the right side, we see also the interest coverage ratio, and that remains very strong. So that remains unchanged in the end. So we have a 4x interest coverage by EBITDA. And therefore also a very strong credit ratios and also a very strong cash position and balance sheet. That brings us to the operating cash flow and CapEx development. And we have grown our operating cash flow massively to EUR 84 million on an LTM basis. Where we saw EUR 54 million free cash flow after interest expenses of EUR 21 million. These are the cash interest expenses because we always have also certain IFRS interest, which are not leading to cash outs. And yes, the very strong free cash flow is in the end, yes, covering the interest expenses multiple times. And yes, we have a limited maintenance CapEx as we don't invest the EUR 550 million into a fully new MMO game and start from the scratch and rather work on mobile games also using some government funding to derisk the development risk. And in the end, still working on the upside potential. And one thing also to mention, so the expansion CapEx on the right side, that increased due to the AxesInMotion acquisition, but also due to the earn-out payments for KingsIsle. And overall, I think very good key takeaway is that we have a very strong high free cash flow and cover our interest expenses multiple times. That brings us to the guidance '22, and we have talked a lot about it today already. So there's a lot of companies currently adjusting the guidance or decreasing the guidance or even saying they cannot give a guidance at all anymore. Well, we're really confirming our guidance, seeing also strong growth numbers overall. And therefore, expecting EUR 295 million to EUR 315 million for the full year with a strong EBITDA of EUR 83 million to EUR 93 million. And looking at the LTM numbers, where we have achieved already EUR 287 million in revenues and EUR 81 million in EBITDA, we see already that we are almost there. And therefore, there's just a very small gap to reach our guidance, might even be already in the second quarter and the third quarter on an LTM basis. That brings us to the midterm financial targets, and these targets are usually given for the period of 3 to 5 years. And here, we also expect as we also did in the last 3 years in a row to grow with the 25% to 30% revenue CAGR with a very strong EBITDA margin of 25% to 30%, with an EBIT of 15% to 20%. And we are also confident that we can decrease our leverage to below 3x again. And again, we have outperformed them for the -- in the last 3 years in a row, and we are very confident that we -- despite the current macroeconomic headwinds, et cetera, that in the next 3 to 5 years, we can really manage to grow the company with the same speed as we did in the past as well. That brings us actually to the last slide and to the financial key takeaways. And yes, I mean, MGI is well positioned to really navigate the cycle. We have a very strong cash position. 70% of our ad revenues is coming also from the U.S. market which is more recession-proof also than the European market. 50% of our EBITDA in the second quarter were still coming from free-to-play games, which rather profit in an economic downturn. And we're also positioned in 2 very strong gross markets, which will grow in the long run and also naturally hedge each other. And as mentioned, strong free cash flow covering interest expenses multiple times and we have diversified bond and debt maturities. We expect and we are confident that we delever over time to below 3x again. And also the earn-out liabilities as we saw earlier is the EUR 95 million coming through, then we would add EUR 25 million EBITDA on an annual basis. So that also puts it in a good relationship and therefore, reconfirming our guidance and being very confident around the future performance of the company. And herewith, I would like to hand over then to Remco for our long-term vision.

And long term with us is 2025. We are not, let's say, a communist country, which is doing 10 year things and so because this market is just too volatile to talk about very long. Thank you both first for the numbers, of course, sorry. Yes, 10 years now, October it will be really 10 years that I'm doing this. We started, let's -- now a few basics of the company. This is basically the building blocks or the stairs, however, we say. First thing that makes life a lot easier, we are acting in growth markets: gaming, media, they're both growing. A lot easier life for a company than to be in markets that are consolidating. I think that's a very important point to say. Within those growth markets, we are positioned on the -- very well on the good side of it. So we are in programmatic advertising, digital advertising, which is growing much faster or whether, let's say, from traditional advertising to digital advertising movement. Games also growing. The demographics, more gamers, more countries gaming, et cetera, and then the shift towards first-party data, the shift towards contextual data is also there, we are well positioned. So I think that's good to really realize this is a company that is in markets that are growing. Second one, platform focus. There's a lot of ways to drive businesses. But at the moment, you have a platform, things get more efficient. The basic platform idea is more volume on the platform is driving more efficiency because your cost basically don't increase as fast as the revenues that you get on the platform. So also that is the second principle, more economies of scale and growing the customer base and getting a bigger share of wallet. So that's the second point or the second rationale behind what we're doing. Third one, building critical mass. When we started with gamigo, just this gaming company, there were a lot of people in the company that said, today, doesn't go well. But tomorrow, we will launch a game and then the world looks different. Look at and then they came with a lot of games that are making billions. Life is not that easy. So what we said, the least risky way to grow is not betting on games, but it's just buying companies and building critical mass. That's what we did in the gaming side. We bought game companies which gave us a lot bigger audience, which allowed us to do cross-selling, which allowed us to gain -- to share knowledge between the parts and really build critical mass and which most of all, allowed us to really run a portfolio strategy. So do not have to bet on we can do -- we can afford 1 or 2 game launches. Now, we can afford 50 game launches. And even if 49 of them are not successful, this company will not suffer from it. So you can really -- you have to run a portfolio strategy in gaming. That's what we did with M&A. We build critical mass. And from that, we are now using it as a launch platform. The same, media side. We said we want to strengthen the gaming side with media. We could have done everything from scratch. I mean, it would have taken much longer, much more risk probably now in the current downturn of the economy. We would have stopped all those projects because they are taking too much money. So what we did also there, learning from the gaming side, M&A. We made a draw board. We said we want to be DSP, SSP, multichannel data, and we just bought companies that fit in there. Last puzzle of blocks were basically Dataseat and AxesInMotion, mobile gaming company and a contextual DSP, which we said, okay, that's what we need. Is there more? Of course, but not things that we really need to leverage and to excel our things. So M&A, very important -- and as Sonja said, yes, not at the moment, our focus. We have a lot of stuff internally always saying, and it's a very -- not very elegant way of saying it. We acquired a lot of toys. Now we have to play with them. And it's -- yes, it's time, and we have synergies and all that kind of things. So we don't need M&A at the moment, and I think it's kind of fitting very well with the marketplace where we're in, also doesn't make do -- makes sense to do M&A at the moment because of leverage and all these kind of things. With all the things that we have, it's the flywheel. It's really -- and I think we have said it so many times that you probably dream from it tonight, but we have the flywheel and it's really the combination of adtech, the first-party content, first-party data and yes, spinning it, the synergies. That's where we are now. And with everything that we bought, we have really bought nice technology, we've partly bought technology that's not so great. So for example, liquid platform or liquid tech that we bought to connect the TV. Great customer base, but the technology is really terrible. We had, I don't know, 3 to 4 crashes per day, and we have now semi stabilized it, but we will duplicate that platform. In Smaato, we also have a CTV platform. So those are things that are happening in the background that you don't see, but there's a lot of optimization happening between the parts that we acquired. With what we have now, it's about really building USPs, really making sure that we do things more different. We have already this full vertical, the multichannel, which makes it special. There's hardly anybody in the market who has that. But we can make our platform available for SaaS. We partly do that already. Transparency. This market is totally transparent. All the platforms, it's dark black boxes, especially Google and Apple. You don't even know where your marketing money is spent partly. So there's a lot to gain in transparency, not only towards where my ads are shown, but much more in this market. Contextual very interesting. ATOM is one of the things that we're working on. So it's now really -- we are working in this company and we're further investing in USPs to further excel with what we have. So this is a bit of history and a bit of outlook here. Yes, Vision 2025, let's spin the flywheel and there's still a lot of things to do. So it's the network effect that we use between the 3 elements, but just to go through different parts that we can still do. Actively launching games, that's something that we are doing. Sorry, I can't better show it here because it's so big. Actively launching games, the game updates, DLCs, et cetera. I mean, Jens covered most of these parts and Miguel, growing the SDK base via onboarding more publishers, boarding IPs to other platforms, question that came from. On the data side, adding tech capabilities, AI, big data, we are hiring experts for that. We have quite a few already, but we need more. Focus on contextual data, focus on ATOM, increasing scale via first-party data and increasing scale via partners. And then when it comes to the tech platform, it's improving, of course, the ad platform, increasing cost efficiency, onboarding advertisers and publishers, investing in open source, which is a very special point, for example. The SDK that we have is, at the moment, the only open source SDK in the market. MoPub was the other one, but that was duplicated by AppLovin. There's an opportunity there because open source gives trust is again a point of transparency. So that's one of the points that we further want to continue to build on and continuous innovation, which is really bringing new products into the market. So that's the flywheel. And then some headlines above it. You have seen these before, at least it's in our slides, with a small tweak, by the way. Being one of the most desired global companies to work for, that's still very important. And I have to really compliment my whole team here and also the people that are not here, it's great to work with them. They're really talent. They're good managers, and that is what is building a company. And one of the very important points from what I really rate as most important, no politics. We really go for building the company, expanding the company, and we hate people that do politics, so we try to fire them. We fire them. Embracing diversity global, professional, global also. Yes, it's very different if you're in India or if you're Indonesia or in the West Coast U.S., it's totally different cultures, different styles. But we make it work together. Engage, very important, innovative and strong drive. We want people that really want to bring this forward. Becoming 1 of the top 5 worldwide leading ad software platforms. We are now a top 5 mobile platform in that platform. We want to also transport that to our other platforms, but here also transparent, open source, innovative, multi-format, omni platform vertically integrated. [indiscernible] a few times. This one, we found out was missing in the last slide. So this is what we added now, delivering cool games. Of course, very important part of it, really the first-party content because that's also driving the whole story, the whole flywheel. So focus on making players enjoy our games while monetizing to further invest in new content. Then -- it's not only internally no politics. We also want externally, respecting our partners' values, delivering transparency to clients. There's too much tweaking in this market, too much in transparency. So we think that we can also win with really trusting the partners. When we have gaming customers, we don't use the data just as is, we would ask them for it, we pay them for it. So those things are very important, combining our own and partner strength, consent-based partner data sharing and also working together with a lot of partners. And building clear USPs that differentiate us, including a white label platform enabling companies to have their own ad software platform and control their own data. Those are our 5 headlines. There's much more happening. We are 800 people, more than 800. So there's more projects than a few that we can stem. On the other hand, it's also, as I showed before, about focus and really executing the things that we do. That brings me to the end of the presentation. And yes, time for questions, and then we have a few drinks and stuff. But we will also ask you about the format, if it's good. We were a bit afraid of going too deep into ad tech because it's really -- there's people here that are very experienced and people that's less. Sometimes it's really a thick book that -- yes, it's very difficult to understand and the deeper you go, the more difficult it gets, but we want to give you insights, share these with you and we'll also want to collect some feedback if this format is working well.

Okay. Paul, join Remco on the stage. And we open up for questions. And yes, we will take 1 here in the room while the operator get ready with the questions on the phones.

I'm just going to give the instructions first. [Operator Instructions] But we will start with a question here from the room.

Yes.

Fiona from Edison. You've talked about adding customers. What are you finding are the main points of resistance both on the supply and the demand side?

Sameer?

We are building blocks of a very large platform. Do we do everything? No. And I'll give you an example. Are we good into rewarded video slots, large-scale video slots? No, not today. But now having Dataseat as an asset, which is a DSP, 90% of the spends currently are on large units. So if we go towards large gaming pubs on that category, now we know that we will be there, right? So that is one example. Are we the best in class to be on CTV? No. We have a very fast-growing business. These premium pubs, they would ask you such a difficult set of questions, give me all the advertisers list that you're running on PMPs, how many direct brand advertisers do you have, right? So we are basically taking those steps. But these are some common examples. And similarly, we asset through Smaato, we acquired mobile, web and desktop assets. Are we there on every premium global publisher on the web or mobile web? No. Are we -- we are still continuing to do cookie sinking with all the DSPs. We are investing into other technologies and the cookies are out. So these are few examples of resistance.

But also here, it's about, of course, adding new customers on the supply side and on the demand side. And so when we talk about customers, it's also suppliers as well as demand side. But it's, of course, also about scaling customers. And if you work for a customer like, I don't know, McDonald, Amazon or whoever, they have -- they use multiple channels, they use multiple agencies often very much. So the structures are very complex in the market, but it's all about delivering quality, showing that they really get money for the -- value for money. And for us, I would say we almost work for everybody already. So it's more about scaling the customers and making sure that they start buying other products instead of really new customer acquisition, where we're still not as strong as I would like to be as with the holdco. So the -- what is it, the big WPPs, et cetera. That takes a bit of time. The companies that we acquired, none of them had really strong, but some had some positions, but that's something that we still want to further build on where we also hire people then that have the contacts and that get us in there. So there is still...

May also see the results already with the 76% organic growth also on the demand side. And by adding also further M&A, that will also bring other customers in where we can cross sell, et cetera. So there's a lot of synergy effects which we can create going forward. But I think also due to the new segment reporting, we can really see already quarter-by-quarter now that the strategy also looks out from a financial perspective.

But there is still room -- still a lot of room ahead. We talk about the EUR 500 million, EUR 600 million. That's a billion market, we're peanuts in that. So we still have to grow.

Okay. So should we go on the phone or take more questions from -- okay, we go. Yes?

Edward James from Berenberg. Just got a couple of questions around FX and organic growth. Could you just explain whether -- what the FX impact is to the organic growth in second quarter? And sort of how does that compare on a constant currency basis to where the business was last year? And a second question is that if we look at the last 12 months of revenue and we gross up, say, Q3, Q4 last year for the FX environment we're in now, how does that compare to the guidance range because we probably are already there? And does that imply an extreme sort of slowdown in constant currency organic growth as a result?

So yes, maybe to answer that, so we don't report FX. There's a few percentage points where we had positive tailwinds also in the second quarter from it. Maybe also to mention, but we also have a lot of cost in U.S. dollars. And therefore, on an EBITDA and free cash flow basis, it's fully balancing out. So we had, I think, EUR 300,000 for the first half year in terms of profits from FX because the positive and negative effects were setting off. And therefore, yes, there is a certain effect. But yes, we also were showing a lot of strong organic growth, I think, on the demand side, where it's also somehow small impacted by FX, but it's not a very big impact on that end. And overall, our company is scaling quite nicely. And one thing which impacted, obviously, also certain revenue growth is that also the CPMs have been decreased, but that was also then overcompensated by further ad impressions, which we were delivering to end consumers. And therefore, due to a lot of traffic could still also generate good organic growth.

One more from the room.

Danesh Zare from Redeye. Yes, speaking about the balance in the gaming portfolio. So you mentioned in the report that yes, the gaming -- free-to-play gaming is very recession-proof. But at the same time, the mobile games, you're monetizing that through ad spending, which is not that recession-proof. Can you speak a little bit about the gaming portfolio where you have the MMO games, which are supported more by in-app purchases and subscriptions, which might be more recession-proof?

Do you like to take it, Jens? Jens, come up on the stage.

So to be honest, I didn't get the question to 100%. So we further will monetize our mobile games via in-app advertisement but also further improve our inner purchases in our mobile games. So as an example, AxesInMotion for Extreme Car Driving Simulator, we're going to integrate an item, so to say, an item shop where you can buy cars all those because we also see that there's a high potential to grow those revenue streams. And then for sure, when we talk about the MMO business, there's no plan to integrate an in-app advertisement at the moment. That's just not what you do in big PC MMOs. So there, we further go on monetizing by subscriptions and in-app purchases. So further adding content, it's just what we did in the last 12 months, just continuing that for the MMO business. And mobile, indeed, also setting a second focused parallel to in advertisement on in-app purchases and then again, user acquisition via our own.

Yes. The question was basically, if you're seeing that MMO or PC console is more stable in a recessionary environment than the mobile?

It depends on how you monetize your mobile games for sure. So if you have a purely ad monetized mobile game, yes, I would say MMOs maybe a little bit more stable. But we have so much opportunity with our mobile portfolio that I would not give you a hard yes on that. I would say, so much opportunity that we still will see growth, organic growth, also together with UA from Verve that we will see organic growth even on our mobile games portfolio in a down going recession market.

But there are some headwinds because the CPMs go down with IDFA, some people have started spending less or, let's say, stopped some spend. So we see indeed that there is less spend on games. On the other hand, there is so much potential that we have, first of all, because we don't -- we are not dependent on the IDFA with contextual stuff that we have. And secondly, we have so much more growth and also margin improvement that we can realize, we're doing it by our own part that we don't see the market pressure that a lot of others see.

And a quick follow-up. You don't report the gaming segment separately anymore in detail. Could you give some color on how much is PC console versus mobile?

So we don't report these numbers anymore. The only thing which we can say is in the end that we have a very stable MMO portfolio. Also, the KingsIsle acquisition had a single-digit organic growth year-on-year. And then obviously, we added also a lot of mobile games now, especially also with the AxesInMotion acquisition where we see a pretty nice double-digit organic growth, and that is something which we don't take into account yet because it's just after 12 months. But overall, yes, we still have a very solid MMO portfolio but expanding more and more also towards the mobile space.

Okay. Any more questions in the room? Should we also check with the operator?

Yes. [Operator Instructions] As of right now, we don't have any questions on the phone lines. So let's continue in the room, maybe.

No, we have one at the back here. Yes?

Just with regards to the mobile segments of the advertising business. We've seen within casual games and hyper-casual games that sort of downloads are sort of normalizing, but probably normalizing a lot faster than most people thought because user acquisition is becoming more difficult. So the question, I guess, I'm asking is how much of the ad inventories sold to other gaming companies, i.e., a gaming -- kind of gaming app trying to acquire users from another casual gaming app? And how much of that portfolio is also hypercasual? Because hypercasual segment's going to come into quite some pressure. So what I guess what I'm trying to understand is as we see the normalization in hyper-casual and casual, how exposed is the business to that? And therefore, is growth there, just more of a market share shift from using identifiers to contextual? And how hard is that going to be to offset?

Your question is already showing how complex this business is. But I think, Sameer, if you can give from there.

So see, what we do here is all the publishers that work with us, we are 1 of the top 5 mobile exchanges today. Selling this inventory, we don't block unless and until it's a recommendation from a publisher that do not expose me to this advertiser. We have a growing base of performance-based DSPs, and I can name a few. These performance-based DSPs, it's their wish, it's their choice, whether they want to advertise on a hypercasual or a casual or a ton of non-gaming premium publishers or so called, et cetera. So we do not restrict it. It's at the choice of these DSPs. But now within our own Dataseat choice of which publishers to go for, where the performance is, it's a very new addition to the family. And we will be more scientific towards the best approach on formalizing the right audience to reach on.

And then sorry, just as a follow-up to that. I noticed that quite a few of the sort of very large casual gaming companies, be that Rovio or King, where they've got very big brands are sort of shifting more to top of funnel types of engagement because basically, trying to identify specific uses is quite difficult. In that context, your flywheel, do you think that sort of positions you better compared to even some of the AppLovins of this world or the Iron Sources, et cetera, because they are much more focused on sort of the bottom end of that funnel?

I would think -- David take this one or Ionut. I mean they're fighting already.

Good question. So I do agree. These publishers that we're monetizing through pure performance because the demand side could identify which users that monetize incredibly well. That has become harder for the publishers, so I completely agree. But a good way to fill that is, as you say, start going up the funnel. So you can then start working more with brand, more with agency, more on increasing that upper funnel percentage of the business. And I think you would agree, within MGI, we do have different demand-side platforms. I think [ Matched1 ] is one, Platform 161 is another and they are very much -- more so than what we are. I'm more selling to those hard core performance gaming companies and will remain in performance because that's where we specialize. But I think one of the strengths of MGI is that they do have different demand-side platforms that focus on different parts of the market. So really, there's a nice hedge there. But yes, I do agree with your observation, and I think there will be more brand spend coming through different DSPs. Might not be mine, but honestly, delivering a brand campaign is easy. It is. It's the performance stuff that's hard. If you can fill up some of those gaps with brand dollars from MediaCom and Coca-Cola, then we'll take that all day long.

Ionut wants to add something to that. So Ionut?

It was a very good question. You're getting everyone involved.

Very good question. That's something else to the conversation. So once you reach, let's say, how do you say, food penetration in 1 channel, let's say, mobile, let's say, there are certain challenges now with IDFA and so on. What do you do as a business, right? You look at where else can I grow and you look at, hey, which other digital segments are coming up and growing every year with double digits and so, right? And one will be CTV, right? And we're experts in brand. We push audiences for top of the funnel, right? It was on my slides before. And we also layer audiences there. So we don't just randomly send brand ads on CTV, but we know, okay, which audiences, which households could be more interested in casual games, for your example, and then maybe we follow up with the banner with data set and get the conversion as well if we saw desire, right? So that's -- yes, that's what I wanted to add to that part.

So now we need 2 more questions to get Miguel and...

Sonja and Miguel joining up on the stage because if we don't have any more questions, I would like to have the whole team up here. And then Remco, I think it's time to wrap up. So I'm going to hand over to you for the final remarks.

Yes, I would like to impolite start to thank the team for what they did and what they're doing and how they're presenting here, really very happy to work with these talents and to bring this company forward. And I would like to thank all of you, people here, people online, but all our investors, all our partners you make it possible that we do this. You believe in us, you invest in us. And yes, we will do our utmost best to further build value in this company. I hope we were able today to convince you or to show you what we are on to and that this company really has a very bright future. But there's also still a lot of work to do this, to get further. We are ambitious. We want to grow this company, and we would like to thank you to be on board here. And there will be time for further questions with coffee. Thank you very much.