Future plc (FUTR) Earnings Call Transcript
February 6, 2020
Earnings Call Speaker Segments
So I'm going to give you a very brief overview of our strategy and how we execute upon it. And we're basically going to spend the rest of the time this afternoon doing a bit of deep dive into each of the component parts of the strategy. So the first thing is, Marcus is going to talk to you a little bit about the importance of diversification. And then we're going to have a little bit of a deep dive into organic growth through audience. And Kevin and Aaron will talk about how we use data and content to drive that. Then we'll spend a little bit of time talking about how we deliver today's growth from previous initiatives and how the bets we made 3 or 4 years ago start to pay off for us. And Matthew and Kevin, as the old timers, we felt were the better ones to talk about that. After the much-needed coffee break, Chris is going to take you through the acquisition playbook and how we go about assessing our acquisitions and what's important to us. Sam is going to talk to you about the really cool new acquisition, which is Barcroft and why we think it's so appropriate for Future to be the owner of Barcroft going forward. And then finally, Penny is going to bring this all together and kind of explain how all these component parts fit into our operating model, and why that works so well in terms of the platform that we've built. And then at the end, I'll be happy to take questions from you. So in terms of the execution of our strategy, those of you who know me well will know that we like to have models and processes at Future. So it's pretty straightforward. We have a 4-step process in terms of how we think about driving medium-term growth. The first one is the playbook. The principle behind this is about ensuring we have alignment within the organization, and we clearly understand what we're trying to achieve. We'll then use horizon planning to make sure we don't focus too much on either short-term or long-term goals. We then focus on the important part, I think, which is the execution of that strategy, so how do we make sure we're delivering against that. And then the final piece of the process is the kind of feedback loop. Inevitably we will get things wrong. Inevitably things will happen we don't anticipate, and it's how do we factor that into our thinking. So the plan today is to just basically take you through each of these. So looking at the playbook in more detail. First up, this is not my idea. I stole it from someone else, it's a chap called Patrick Lencioni, and he wrote about how best organizations get alignment around strategy and then onward execution. And what Lencioni says is, you have to ask your organization 6 fundamental questions. And that's exactly what we do at Future, and we do that every year as a kind of refresh process. So the first question we ask ourself is, one might assume, slightly self-evident. But why do we exist? Why Future? Why us? Why not someone else? And I'm not going to read to you what's on the slide because you can read it for yourself. But the key points here is, we believe we are knowledgeable. We believe we're expert. We think that's really core to the DNA of Future, our expertise. We also think that we are about fun and making things easy and about helping people. And so we very much operate in a position of how can we use our expertise and our knowledge to help people do the things that matter to them. And when you then are clear about why you exist, you can then think about how best do you behave in that organization. Now lots of organizations, and you may well belong to some, have values. I'm a great believer that it's not the Chief Executive's job to decide the culture. It's the organization's job to decide the culture and it's my job to facilitate it. And so over the last 5 or 6 years, we basically crowdsourced these values, and they're very much part of our DNA, so much so that when we're interviewing people for new jobs, we're interviewing them based on their behaviors and competencies against this framework. And what that means, therefore, is you make sure that you're aligned in terms of how we work and what's important to us, not going to read them all out, but picking up a couple. One of our values is we're part of the audience and the community. That's a unique value to Future. We -- half of the colleagues in the organization write or create content, they are part of that community. And what's really important is we never get a bit arrogant or a bit snide or we get a bit ahead of ourselves since we always remember that we are just like the person who's reading the content we write, and therefore we have to have that attitude in terms of how we behave. One of our other values is around, so let's do this. We have our bias for action, there will never be perfect information. And so what we encourage in our organization is, in the absence of perfect information, let's always decide to do it and then course correct if we get it wrong, rather than stall and decide not to act. So again, it's really important that when we think about what we want to do, we're clear about how we behave. The next question is in our business model. And we had our AGM yesterday. And someone asked a question about this, and one would think people know how to make money in their businesses, but actually quite often I think people forget what it is they do and how what they do actually makes money. So what we did at Future is, we created the wheel because I like to keep things simple. And the simpler I can make it, the easier it is for us to make sure we're doing the things that make us make money. So let me give you an example. We have a photography vertical at Future and that sits at the heart with the content and the data that sits underneath that. And today, we have 5 of the U.K's leading photography magazines, and we monetize those through newsstands, you can go to Smith's today and buy a copy, or through print advertising or through subscriptions. And so that's a really nice piece of business underpinned by great content. What we also then realized 2 years ago was, hang on a minute, why don't we have a dedicated photography website that's kind of always when you think about it. So we launched a site called DigitalCameraWorld, and we took that content, and we curated it and slightly re-edited it and then published it online. And then we also hired an online editor, just one at the time, to add additional [ Pacific ] content for an online audience. And what that then meant was, we can then monetize it again, through digital advertising, and we could also monetize it through eCommerce. So people would read a review, they'd find it so helpful they'd then want to go and buy it. And when they decided to buy it, we would take a percentage of that commission. So that was really good. However, we were also thinking about -- we had this fantastic subscription database and all these engaged customers. So we have an event called The Photography Show, which those of you who are photographers will know is the biggest event in the U.K. and 32,000 people attended it last year, and they were on our e-mail marketing database because they were part of our subscribers. So that meant we could launch an event, because we knew the right people would turn up. And because when you would have a qualified audience, that then meant we can go to the advertisers who we already knew because we make money from them in the magazines and online, and say, do you want to take some exhibition space? And that's what made the event successful. We know we're expert, but we're not very good at writing in foreign languages. So what we then did was we said, how about we license this content internationally to all the countries that don't speak English. So we did that as well. And then through our content, publishing and license business, we also signed a deal with Canon because what they said to us is, you're so expert at photography content, can you do it for us? And so we actually write a lot of content for Canon, we've got a contract we've had with them for a number of years doing that. And so fundamentally that's our business model: great content, the use of data, and then we basically go through it and trying to work out, not how can we monetize the same person again, but how can we find the right audience, at the right time, in the right place. So once we know how we're going to make money, all we need to know then is, how will we succeed? What's our strategy? And those of you who've followed the Future story for a while will recognize our strategy statement. I'm not a fan of blue-sky thinking, and I'm not a fan of big set pieces. I think it's really straightforward, our strategy is our map, is where we're going. And what we try to do is set out a set of intentional steps so that every day, every decision is the execution of our strategy. So we're going to be a global platform underpinned by specialist media, powered by technology with diversification of revenue streams, and looking at how we can expand our global reach. I'm going to talk about in more detail over the next few slides. So we've got a strategy, and we know how to make money. But fundamentally, most businesses fall down at this point. How do you execute? And so what we think about is, what is actually important now? What must I do today? Those are my intentional steps today to execute on my strategy. And every year, we go through a process of deciding what they are and then they become -- are what's important right now, and we went through a little stage in the organization of calling it the WIRN. And then we said, hang on a minute, it doesn't mean anything anymore, so you have to say the words out loud. You have to actually say "what's important right now" because that's when you stop and think about what's important today. But when you say, what was on the WIRN, you kind of forget what you're talking about. And so we actually made the point of not making this an acronym, and paying attention to the words. And then the final part is then we know where we're going. We know what we want to do when we get there. But who's going with us? So how will we behave and who must do what, because this is all about our responsibilities to each other and to Future to execute upon that strategy. And so what that means in reality is, we cascade the what's important right now into everyone's objectives, into every department's goals for the year, so that everyone can take a line all the way back up to the global strategy, and know the reason why I'm doing this thing in this one department is because I'm helping with the overall objective. And one of our values is that we all row the boat, and that means everyone knows their contribution genuinely makes a difference in the organization because they understand the role they play. So that was the first thing, Alignment. The second thing is Horizon Planning. And I stole this off of McKinsey, so if any of you are McKinsey graduates you'll recognize this model, but it's really basic. What it says is, any point in time, some of your effort has to be in how am I making money today for today. What are my initiatives to support today's horizons. At the same moment in time, some of your resources need to be focused on what am I doing today to generate revenues in new business in 12 to 24 months' time. And then horizon 3 is 24 months plus. So by using this methodology, all we do organizationally is just make sure we've got the right balance of short-, medium- and long-term initiatives. So the next step then is Execution. Now our strategy at Future fundamentally hasn't changed. I'm very pleased. Our design templates have, because these look awful when you put them up, but these are actually our strategy slides from '15 and '16, [ in the BDI ] where you can read them. And the key reason we put them back is because the things we talk about are being a market leader, growing our revenue streams organically, accelerating our growth through acquisitions. So that hasn't changed. What's really important is that we execute well upon it, and that's the core part about focused execution. So I took you through the what's important right now earlier, but the reason why I just put it back here is to think about what we're doing is not changing our strategy, but every year making sure we've got the right steps. We're doing the right decisions today to take us in the right direction. Then underpinning that, every year we have these pillars. And these pillars are core to our purpose and what we said was important to Future. And that starts with growing our existing brands and audiences. How can we reach and grow the existing brands and heritage we have in the organization. And the next thing is launching new brands and new verticals. And sometimes that's from within an existing portfolio. DigitalCameraWorld was a new brand that we launched within an existing portfolio. Sometimes it's completely new. Continued diversification. I obsess about becoming irrelevant, I would never ever want our business to no longer be relevant. And so we've got to always thinking about how we diversify. And then the final point, if you're not investing for the future, you have no right to expect to have one. And therefore, it's really important for us to continue to ongoing invest. So one of the other key pillars of execution is organizational alignment. And at Future, we talk about pirates. So some of you may also know that I've also stolen that from Steve Jobs. So back in 1983, Steve Jobs was trying to pursue people to come and work at Apple versus Microsoft. And he talked about, if you want to go and join the Navy, go and join Microsoft. But if you want to be a pirate, come to Apple. Now what he really meant, and he was trying to use an analogy of people who don't worry about bureaucracy, who are fast-paced. Who get things done. Who are prepared to take risks and prepared to have audacious goals and go after them and not be fearful about getting things wrong, but instead course correct. And when I read about it, I thought man, this just sounds like Future, and we should take that because that's a great idea. So we talked about how do we identify those people. Now that's not for everyone. My husband would hate this, right? He likes structure and process and rules. And therefore, what's really important is that we go through a process of identifying the right behaviors and the right people for us, we make sure when people join us, they know who we are and what's important and how we work, so they can make the right decision for when they join us. And we go through our process again, BDI, the one. This is my Talent in Q Dimensions. This is my leadership circle, BDI-ed amongst you. But we do a lot of psychometric assessments, but we also -- this picture here is me and my management team climbing the 3 peaks, which is the 3 highest peaks in the U.K., at about 4 a.m. with our leadership coach to help us understand how we could work better as a team under pressure, right? So it's about being a little bit unusual and also using the traditional tools. And what that, therefore, then means is that we can make sure that the people with us on the execution of our strategy are absolutely right to be alongside us. So coming back to then what is the 2020 plan. The first line in our mission is being #1. It's really hard, I think, for any of us to argue with why that's not an important part of our strategy. And that's very much a horizon 1 goal. What we want to do today is make sure we're doing everything we can to grow our leadership positions and our brands and also in our verticals. Our second strategy for this year is unlocking new brand potential. Over the last 6 months, we've launched 5 new brands on the Vanilla platform, organically while doing everything else that we've been doing, all about making sure that what we're doing today is relevant for today's market. 5G didn't exist 3 years ago. That doesn't mean -- maybe it did, actually. But most of us didn't know about it. That doesn't mean we shouldn't write about it today, and that's about making sure we're not stuck in the past, but thinking about what does our audience care about today. The third, what's important right now for 2020 is supercharge and support. If we're going to double again in size as an organization over the next few years, we've got to make sure the back office can scale because we don't want organizational day or drag or complexity. And this is just a selection of the dashboards that we have to allow us to constantly monitor where the pressure points are in the organization. This here is a HR self-service portal because as you get bigger, your job is to create an infrastructure so people can help themselves rather than rely on individuals to do things for them. It's a good example also of when we grew our business in the U.S. 18 months ago, we realized that we needed to pivot a little bit in our model. So we like to have low-cost locations on hub, our back office teams but we recognize based on the feedback from these dashboards, we actually did need a couple of boots on the ground. We needed some people who knew the U.S. market better than we did, who are expert. And therefore we put some HR resource into the U.S. and then we continue to monitor to see if that's having the impact we expected. And then the final piece of our -- what's important right now for 2020 is evolving the Future wheel, and that comes back to horizon 3, what are we doing today to think about how we might make money in 2 or 3 years' time. And some of the team are going to talk to you about that later. So I'm not going to steal their thunder. Now obviously, some of you will notice we bought a few businesses. So we accelerate our strategy through acquisitions. But it's not a fundamental part of our strategy. And the right acquisitions for us are ones where we genuinely believe that we can add value and that meet our criteria. So let me give you an example. There's a fantastic business in the U.K. called Dennis Publishing. They publish a magazine called The Week. It's a brilliant magazine. It's a brilliant management team. They're really efficient and when we looked at it we were like, we can't do this better. It's a nice EBITDA, it's a really nice revenue stream, and if we were just interested in consolidating, we'd have been there all day. But actually, we had nothing to add to it, and that's why we decided to walk away from that transaction. So we're constantly thinking about, can we add value? And is it -- does it fit with our criteria for success? And at the same time, the final point here is speedy integration. Truly important for us that it's not distracting. So it doesn't get [ in the way ] in the core part of our business. And so we need to be able to be confident that we know how to integrate it quickly into our organization. So that all sounds great, and I've talked about Lencioni and McKinsey, and don't I sound clever. But in reality what we all know is, that's not what happens and things go wrong and you make mistakes. And things happen economically which change the plans that you thought you had made. And so what we've built into our process is constant review to ensure that we course correct before we find out that we've ended up in Greenland rather than San Francisco. So it's a pretty -- I think every business has this, but we're pretty fanatical about making it happen. And sometimes people will talk to me and I'll be like, I can't talk to you, I've got Friday night's trading calls. Every Friday night, I go on the trading calls, and I get an update from the entire organization about all our revenue lines because I want to know about next week's revenue because that's a really important part of our pulse and how we manage horizon 1. We have monthly business reviews and steering these things for the things that are really important, but in the here and now. And then we use quarterly business reviews to step out the detail, to take a step back. Where are we on the execution of our strategy? What's important now? Is there new news that we need to think about? But you can't keep changing course every week, because you'll drive the organization mad. So there are set moments in time when we sit down and say, do we need to think about doing things differently. And then annually, we come back and we go back to the start, we go back to the process I've just taken you through. So in summary, I'd like to think that there's a clear strategy, and the team will take you through it in more detail in a moment. Aligned within our organization, the clear sense of what our values are, with a really clear focus on execution and results in the short term, medium and long term. At which point, I'm going to hand over to Marcus, who's going to take you through diversification.
Thank you, Zillah. My name is Marcus Adolfsson, and I joined Future through the Mobile Nations acquisition last year. As Zillah just presented, delivering more spokes and more wheels is core to Future's strategy. And by following that plan, we've built Future into a resilient global specialist media business with diversified footprint, diversified verticals and diversified revenue streams. Diversification is important, as it allows us to have a strong defense against the impact of detrimental changes to any one revenue stream. And a strong offense by seeding horizon 3 opportunities that enable continued organic revenue growth. The first leg of our diversification strategy is a diversified footprint. Future today operates in U.K. and in the U.S., and we have a global audience. This reduces the risk from political or economic instability in any one particular region. And revenue from the U.S. is now at 54%, up from 31% in 2018, demonstrating our ability to materially diversify geographically. And the U.S. organic growth is higher than any other region. To extend our audience to non-English markets, we have a growing network of partners. Unlike other media publishers who only license their brands, their logos, we license complete business systems similar to a franchise model. Last year, we launched 3 new partners in India, Benelux and Italy. And we launched our first multi-language website in Europe. We love this franchise-like model because it protects margin and local partners assume the expansion risk. The next leg of our diversification strategy are diversified verticals. Future is very prominent in the tech space. But today, only 60 -- today, 64% of revenue comes from outside of tech, in vertical categories such as hobbies, music and B2B. We further diversify inside each vertical by launching multiple brands, and that enables our search 1, 2, 3 strategy, where we want 3 of the top 5 organic search results to be from a Future brand in the categories where we compete. Speaking about search, diversification across multiple verticals and brands reduces the risk of search engine algorithm updates affecting overall traffic materially, since those updates tend to be very vertical-specific. And of course, diversified verticals also allows a faster audience growth since we can reach a wider potential region. To get that audience to come to our website, in an average month in 2019, we produced about 10,000 pieces of new written content, and we do 9,000 updates to existing articles across 185 brands. And I'm going to take you through some of our verticals and some of our brands, so you can better see our breadth of scope. First up is Hobbies & Knowledge. This vertical is led by space.com and life science. As I'm sure you're aware, space is exciting again, and we're harnessing that into growing our traffic. This category was up 10% in organic online audience last year and our other hobby brands such as Bike Perfect offer significant eCommerce opportunities. You heard Zillah talk about photography earlier. It's up a whopping 331%, all organic. And Digital Camera World is now the #1 photography website in the U.K. and #2 in the U.S. and the photography show remains the largest photography exhibition in the U.S. -- in the U.K., sorry, and attracted over 32,000 visitors last year. We're very excited about the Home Interest category. We have a website called Real Homes there that this year delivered significant audience and revenue growth. It's up 41% organically. And on the events side, the Homebuilding & Renovating Show is the #1 homebuilding show in the U.K. with over 100,000 attendees. Games & Entertainment is led by GamesRadar+ , which was up 72% last year, and PC Gamer is the #1 global PC gaming website. As a whole, the vertical was up 31%. And of course, technology. Future is the #1 consumer technology publisher in both the U.S. and the U.K. We were up 28% on organic online growth. If you add in the Mobile Nations brand that were acquired, 56% growth in that category. And there's always a continuous stream of things to write about in technology. It never sits still. In music, our music vertical caters to both music fans and musicians, Guitar World and MusicRadar hold the #2 and 3 spots in the music-making website category in the U.S. and U.K. This category was up 42% organically. And finally, our B2B vertical with the sub-brands in technology, Media Entertainment for [ consumer ] and Education. We're very keen on growing this vertical because it helps us connect advertisers with decision-makers by delivering industry insight. And it's smaller, but much more valuable on a per-user basis. We made a large acquisition this year in SmartBrief. If you include the SmartBrief revenue on a pro forma 2019 basis, B2B now makes up 25% of Future's revenue. The third leg of our diversification strategy are diversified revenue streams, and it's not just talk. Today Future has 9 significant revenue streams at different level of maturity. Over 70% of our revenue comes outside of print. And we invest heavily in higher-margin horizon 1 activities such as eCommerce, which grew organically at 73% last year. And digital advertising, which grew at 25%. And our strategy calls for continued diversification, either through acquisitions or developing new revenue streams internally. And earlier this year, late last year, we decided to formalize that internal development of new revenue stream, and ensure that as a company we focus internally on things that are new. And we're going to do that in a division called Future Labs. And Future Labs has built a playbook that industrializes horizon 3 by identifying new opportunities and then cost-effectively innovating those ideas into minimum buyable products, after which we support those product -- projects inside of labs in an incubation phase, and the successful products -- projects are then going to be integrated into the rest of Future. There are 2 projects currently inside Labs that I'm very excited about that I'm going to share with you. The first one we call off-platform eCommerce. That's where we syndicate our recommendation content to partners such as retailers. We were the launch partner of Amazon's syndication program, where our recommendation content lives inside of Amazon search results. For example, if you're today in the -- on Amazon U.S. would search for best gaming laptops, you will see editorial recommendations from our brand Windows Central inside those search results. And that's very much additive revenue, as in this case the user started their search on Amazon instead of using Google, and come across our brand as they typically have. Another project we are excited about is scaling lead generation. Future today does a really good job driving a tremendous amount of volume of clicks and conversions to eCommerce retailers, but the commission on a per transaction basis tends to be pretty small. With lead generation, we can capture in-market customer information and monetize it multiple times at a much higher cost per lead. And the same advantages that have made Future a powerhouse in eCommerce referrals, high-authority brands, content expertise and strong commercial relationships will enable us to scale the lead gen business from a position of strength. So hopefully over the last few minutes, I've given you a little bit of insight into how Future has diversified in the past, and how we're going to continue to diversify in the future. And as a recap, we today have a diversified footprint, diversified verticals and diversified revenue streams. And with that, over to Kevin.
Thank you, Marcus. Hello, everyone. My name is Kevin Michaluk, and like Marcus, I joined Future through the acquisition of Mobile Nations last year, where I headed content and operations. And personally, I've been a content creator, publishing stories online about my hobby since I was 14 years old. So I have a real deep respect for the content we publish and all the editorial teams who produce it. And I think for a lot of us at Future it really is the dream job, to make a career out of our passions. And it's one of the reasons I'm so happy our brands landed at Future. I really do believe in our data-driven content strategy and the strategy of scaling specialist media. And in my time at Future and in the media industry, I really believe we're unique. Unlike a lot of other publishers who -- and we actually lean away from editorial instinct guiding what content we should focus and write about. Instead, we have a data development and -- approach to our audience, or a data approach to our audience development where we actually use data to determine what content readers want to read. And once we figure that out, then the editorial teams bring that content to life and they exercise their craft and bring it to life with passion, authority and make it entertaining. And we produce a lot of types of content at Future: news, reviews, opinion editorial pieces, buyers' guides, help content. And what we found through the years is that our most valuable audiences have intent behind the content they're consuming. We're not just trying to hold their attention, but we're actually trying to help them accomplish something. And we do that, they're happy, we're actually helping them. But when we have that alignment between the content and the audience, we can also find more ways to monetize the content than just advertising. And it's for that reason that Google is, and I think will continue for many, many, many years to come, be our best source of growing the intent traffic to our websites. So when we look at a lot of the other platforms out there today that are big, especially these ones that are feed-based like Facebook or Instagram, Twitter, TikTok, they're sort of the opposite. They're more about consumption and holding you on their platforms. You go to these apps or websites, and you just start scrolling and scrolling and scrolling, and you sit there and you consume content. But you don't necessarily take action on it. And those platforms tend to reward attention-getting content or sometimes almost bombastic content, which is kind of the opposite of intent. You think about Google, you go there with a purpose. You type it in, you go there, you search for something and Google's job is to show you relevant results. And that's something we can always work with, because Google's search algorithm aims to surface the highest-authority, highest-quality content and sends the traffic on its websites, and that's what we have. We have authoritative websites, and we want users on our platform because when people land on our websites, we control the user experience, we control the monetization. And as you can see from the chart, we're really good at driving intent traffic to our websites. And this graph shows growth from Future's legacy websites. We're not looking at any of the recent acquisitions in the last couple of years. Now that growth doesn't just happen. This is where our secret sauce comes in and our data-led content planning approach. And what we do is, we triangulate data from 3 primary sources of tools and content and data types, to basically hone (sic) [ home ] in on these high-potential content ideas. So we use SEO data, we use retail data, and then we use data from consumer trends and products. SEO data is pretty obvious. If we want to drive traffic from Google, we need to get a lay of the land, and that's what that helps us to do. We can see what opportunities are out there, we can see where we may need to double down on our content efforts to really climb up in the ranks. Or we're going to see where we have a strong position with traffic, and we need to work hard to defend that against competition. On top of that we layer retail interest. And that gives us a sense of the volume of interest around the subject, and where marketers are putting their marketing spend. So that helps us identify the really big potential ideas from the ones that might seem good, but just don't have the audience around them at the time. And then lastly, we add in the consumer product data trends. And that helps us get a sense of what trends are happening, what products or services are coming -- becoming hot. And that's where we always want to go. We want to be where things are getting hot. And we actually want to get our content ready in advance of that consumer demand so once the trend takes off with the public, our content is there to be discovered. Now we also use data to optimize the content architecture and editorial mix of our sites. And this is really important because we want to balance audience monetization with audience growth. And that's to set up the sites for long-term success. In the short term, you could always try to max out your monetization, but that might come with a penalty associated with it. So it's really important that we find that happy balance. And as we illustrate on the pie chart here, not all content we publish has the same revenue potential. For example, we publish a lot of news and editorial content, and that's great for building audience, building authority, building community to our sites. But if you think about news, by default it sort of has a short life span, news is hot for a few days and then the demand for that content goes off. So we have a shorter period of time to make money from that content, which is why we also publish a lot of evergreen content. And that's articles that have a much longer lifespan because they're relevant for a longer period of time. So if you think about the stat Marcus gave, that we update 9,000 pieces of content a month, that's to keep all the evergreen content we do current, so it's useful to users who land on it maybe days, months, weeks after we initially publish it. And as you saw on the last chart, the most valuable type of content we have is shopping content. As mentioned, we can earn revenue from affiliate commissions. And that happens when users with shopping intent land in our articles. We help them make a purchase decision. We send them off to a retailer. They transact and buy a good and then we earn a commission on that. And what's really great is that, that compounds over time. So not only is it high revenue content, but we can pay for it in one period of time, make the money back, and it continues to earn for multiple periods going forward. And this is my favorite chart of maybe the whole presentation today because you can see how content we paid for in Q4 2017 earns revenue in every subsequent quarter right through to Q4 2019 and even today, while we're in this room. And that just continues to build. And that's one of the reasons we're so excited about lead generation, because the same model is going to apply to that content at an even higher value per transaction. So how do we pull together this data-driven content strategy to make sense for our users? What we do is we focus on the consumer journey. And I'm going to show you on the next slide how we -- a more traditional look at the consumer journey, but the point I want to make here is that today's consumer journey for the marketer who's trying to sell products to consumers is really complicated. It's definitely nonlinear. It's a little bit chaotic. And the reality is marketers are no longer in charge of that consumer journey. It's actually the user who's in charge of it. 87% of shoppers now begin their searches online, when they're doing product research. That's especially true as the cost of a product goes up or the complexity of a product goes up. And they're hard to sell to. They're going to make their own decisions. And the way users or consumers make decisions is by answering questions. They ask a question, they get an answer, and that helps them make a decision to move to that next level closer to buying a product. And when you look at all the platforms out there today online, the only one that people still go to, to ask questions is Google. You don't go to Facebook to ask for recommendation advice. So it doesn't really matter where a consumer becomes aware of a product, it could be an Instagram ad, a TV commercial, a billboard. If they start to get serious about it, they're going to go to Google and look for information on that product, and that's where we're set up. And with our 1, 2, 3 search strategy in the products we cover, we almost build a moat here. It becomes very difficult not to find our content online. Now from a content planning perspective, it's actually really easy for us to visualize all the questions a person is going to ask as they start researching different products. And it's not just product research, we can think about our news and editorial coverage fitting into this as well. So on this slide, I'm using the example of fitness. And you can see at the top, we have a lot of categories of content we could cover. Could be fitness gear, could be fitness trackers, could be smart scales. And as we jump down into a category, for example fitness trackers, it becomes straightforward for us to map this out. We might start at the highest level with content like best fitness trackers. And then we go a level deeper and we do best fitness trackers for runners, for swimmers, for kids, for pets. I bought one for my dog recently. And then you go down a level deeper and you say, well, what do I want? Do I want a Fitbit or an Apple watch, and we do those types of comparisons. And then you decide you want a Fitbit because it has better battery life and you can wear it to bed. At that point, you start to ask those like last little questions before you'd really buy a product. What colors does it come in? Where can I get it for the best price? Or the example I highlighted here, how to measure your wrist before buying a Fitbit. It seems like a really simple article, and it is for a company like Future. We can publish that very quick. The thing that gets crazy is the scale of the world and how helpful this content is. Since we published that article in 2016, over 200,000 people have landed on it, looking for an answer to that question. And that's 200,000 people with their credit cards out of their wallet, about to buy a Fitbit. And that's just one article. And yes, it's sell of lots and lots and lots of Fitbits. But when you think about that model, you -- types of data we get back as our playbook gets smarter, and you look at all the verticals we're in, with all the websites we're in. And we put that much attention to a single article, it really gives you a sense of how big this can scale and is scaling. And that's what it's all about. We want to be able to always learn from the data and make in actionable insights to keep launching new businesses for us. And I'm going to end today with an example of a recent success. So in 2018, we had a data insight that streaming services were really taking off for us. And it was an article we wrote about DIRECTV, and it prompted us to look at the space a little more closely. We actually launched a site called CordCutters to start building some authority in it. Now in 2019, Future built on that insight, and we applied our audience development strategy to it. And when it came to the launch of Disney+ last year, we absolutely crushed it. So that actually became the #1 most searched term in 2019 in the U.S. on Google, and we ranked #1 for it. And I don't know what else I can say other than that. When you rank #1, for the #1 most searched keyword, you know you're running your strategy right. So with that quick summary, what I hope you've taken away from this today, is that a data-driven content strategy and workflow yields many paths for Future to have continued growth. It starts with our target audience. We want readers with intent. We reach them through Google because Google surfaces users with intent, data leads our content planning, we use the data to optimize our content architecture to make sure our sites are set up for long-term success. By focusing on the consumer journey we can never go wrong, because we're helping real people spend their money, get help and everything in between. And we keep looking at the data to drive new growth. So with that, I'm going to turn it over to Aaron Asadi, who's going to talk about how we continue to grow organically through adjacent markets.
Thank you, Kevin. I am welcome. Hello, I'm Aaron Asadi. I am MD of eCommerce and apparently also now officially, the best part of the management acquisition. So that's good, that is excellent. And I'm privileged. Where is Zillah? Doesn't matter. Penny, Matthew, Kev, all of you, all of my fellow speakers, I'm privileged to be on this journey with you, I really am. And it is a journey, right? So you see a lot of slides today, but obviously, data [ that future ] is different from slides, it's a lot of work, it's a lot of people working hard to come up with ideas. It's important. And what is moving towards that rare treasure? New. At Future, we are proud of our past and delighted for the results. Look them, they're good, right? And we're always more excited about our future. Always looking to pastures new. New will come from many places, geographies, technologies, but also markets, and ones close to where we're operating today. Since the very beginning, the story of Future is one of expansion, innovation, exploration into new markets. Of course, it starts with games, then through cycling, film, music, tech and homes. Some of these, like photography, are homegrown, an idea we had at Future, invested in, grew it. Now it's flourishing on multiple platforms as Zillah spoke about earlier. Others, such as music and homes have been gained through acquisition. But regardless of the method of expansion, that sense of adventure has stayed with Future since 1985. It is in our nature to have the courage to ask what's next. And unlike many other media businesses, we have never been restricted to certain categories or areas. We have passion for where we operate but also a formula for success. We don't just specialize in subjects, we specialize at being specialist. So what's the process for moving into adjacent markets? What's the formula for expanding our brands into nearby areas? Well, it starts with assessment. Our compass for pastures new will always be our audience. Who are they? Are we sure we know? How are they changing? What do they want? And we have many ways to find out, from our own panel, illuminate, to our ad data, online analytics, social engagements and surveys, not least of all, we know a lot about our audience because we are our audience. Our games writers are gamers, our music editors are musicians. Our homes teams are homebuilders. So we don't just look outward for insight, we can look within. We learn a great deal about the audience, and then we use that information to profile personas, design content and products around those. We combine this with wider insights, such as retail reports from Hitwise. And then we ask, how do our customers match what's happening right now? So what do we learn? Quite a lot, actually. Using our data and research, we can determine age, gender, territory, profession, preferred companies, retailers, propensity to spend, interest, opinions, credit card spend, eating and drinking habits, travel plans. We then inject this insight into our content strategies and compel clients to spend with us. And because we have the scale, we'll always be confident of our ability to identify audience and sell contextually regardless of evolving standards. We'll get to the Instant Pot in a minute. Our specialist sites themselves are also a hugely important gateway for us in terms of being able to identify new opportunities. Alongside product first audiences we also have retail and loyal audiences. People are looking for Argos as much as they are a new laptop. Amazon Prime [ days ] is just one example of this. This means we gain insight into products that might not otherwise be considered as high on the list of a specialist consumer. So we didn't know that tech heads were into Instant Pots. I didn't really know what an Instant Pot was until I found it on one of our websites. Apparently it's a fancy pressure cooker, quite good. So in time, we get to see how these products perform on Google News and how they convert on our platform. Fundamentally, we learn, away from our established core, do we have the ability to engage in this new market. But gaining insight is only one part of it. How we use that information is even more important. If we are going to be able to engage, we have to have confidence in our domain authority in a given area. After over 15 years of answering questions well, Google trusts our sites. You can't cheat this. It takes time and expertise. Google is clear what it wants, E-A-T it calls it. Expertise, Authoritativeness, Trustworthiness. And we have that in spades. And right now, with our biggest-ever audiences, we're confident about our ability to do more. We see this because we now have a proven ability to extend into new areas. A great recent example is on Tom's Guide, a website we acquired from Purch. It never covered laptops, never covered laptops. No content at all, and just one push from us into that area, it was ranking top spots in the U.S. And I actually want to look at that example a little bit more closely now. Tom's Guide is huge, right? Reaches millions of tech enthusiasts every month. But its previous owner just never saw the opportunity in laptops. Just didn't, don't know why. But we always question things at Future. We always want to grow. How do we build? How do we get better? So we looked at the opportunity, identified the key terms. We tested in category content, we rapidly expanded through freelance, then we quickly embedded the category as part of the core team's plans. And then laptops is ranking in the U.K. and in the top spots in the U.S., within weeks, is now a fast-growth revenue stream for the brand. It's a great example of us winning, Future winning, while others didn't. So we have the ability and insights to do more, but we also need to be confident it makes sense for the brand. Brands can grow the audience, but there is a limit, we have to be credible. Yes, we're in a world where everything feels like it's tech. What isn't now entertainment? What isn't for the home? T3 was tech-focused. But by moving from adjacent to adjacent, it's now steadily grown into a lifestyle brand with reach and engagement higher than ever. We see exactly the same opportunity for Tom's Guide, for Real Homes and several other Future sites. And how did T3 expand so successfully? Were launched back 1996 as a magazine, spawned a website, spawned some events. Over time, print sales declined, online content with second place TechRadar. Weren't happy, we relaunched the brand in 2017. And then pivoted 1 category at a time into lifestyle. From 100% tech content to nearly half of its audience engaging with new categories, such as travel and automotive, T3 is now an innovator brand of Future. Testing and scaling new areas at pace. And it's a strategy that's seen global audience grow to all-time highs. So we know we can move into new areas. We know we want to. So the question is always, where next? Once we have a sense for where we can go, we then identify the commercial opportunity. Our sales and eCommerce teams will research spend in those areas by client and customers alike, looking at potential competitors in the space. And once we are green for go, we go. Right now, to give just a few examples, we feel we have opportunities in home appliances, pet care, finance and insurance. The last one in particular is interesting to us. Finance is integral to the purchasing journey, particularly in tech. It's the reason Apple launched its own credit card. Furthermore, with TI Media, we're excited about gaining the credibility and ability to go after areas such as outdoor sports and travel in a big way. And with TI Media, all these fantastic brands await us. New opportunities to learn about different audiences, new opportunities for engaging content. And from those opportunities move into newer places. I'm excited about what we can do with TV listings in the world of streaming. Cannot wait to apply our formula to golfing. Go on an adventure with a boating brand. This portfolio gives us so much more new potential. And we're already making great progress in a number of new areas, too. Fitness is a market we've been able to enter through the side door of Apple Watches. We're super excited about the potential of this one. Streaming, too, has started to become a big audience driver for us on our tech and gaming brands. And as Kevin said, with the launch of Disney+, we've seen that massive interest convert to real success. And one area we're focused on right now is 5G. We enjoy leadership position in connectivity coverage, everything from broadband to iPhone. And we leverage this to gain an advantage in this new adjacency. 5G is already becoming a high-value category and has still yet to penetrate the mainstream. The chart you see is an example of just how we monitor the terms. It's a Google trends graph, showing that 5G already reaching the levels of interest 4G had in full swing. Moving into this adjacency is natural for us. We want to win in it. So we're leaving nothing to chance. We surveyed thousands of consumers and businesses across the U.K. and U.S. in our biggest-ever market research effort. We designed a collaborative consumer content strategy across tech brands, launched a B2B-focused 5G site, 5gradar.com and started a major campaign to win U.S. and U.K. 5G spend. And we recently booked our first 7-figure deal with a major U.S. carrier for 5G. So we have the credibility, we have the brand and we have the ability. Our tried and trusted process is the way we realize our ambition. That means the same steadfast commitment to quality content, real expertise, great SEO served on a proven platform, supported by teams throughout the Future business. We are proud of our past, and everything we've done. But we know there's even more to come. I'll now pass you over to Matthew Pierce and Kevin Li Ying.
Thank you, Aaron.
Thank you, Aaron. Good afternoon, everyone. I'm Matthew Pierce. I'm a Brand Director at Future. And it's my pleasure to be able to co-present to you today alongside the group CTO, Kevin Li Ying. Kevin and I have somehow amassed more than 40 years of tenure at Future, during which time we've been lucky enough to play parts in the transformation of Future into the global business platform it is today. It's been an extraordinary journey to be a part of. And it's some of the landmarks on that journey that Kevin and I would like to speak to you about this afternoon. In particular, how the strong growth that we've seen in recent years has come from the long-term horizon 3 goals of our strategic planning process.
Yes. Thank you, Matthew, and good afternoon, everyone. As Matthew said, I'm the CTO for the Group, and I'm delighted to be here to talk to you today about our tech stack. Its evolution over the last 4 years. And how it has enabled us to continue to deliver technology-powered growth that is predictable, sustainable and drives revenue and profit for the organization, all the while meeting the needs of our consumers.
As you've already heard from Zillah, we have a relentless focus on our strategy at Future, and we recognize that the alignment behind our strategy and the execution against it is critical to what we want to achieve. Put simply, we're all pulling in the same direction, or to use a Future value, we all row the boat. Horizon 3 is about setting goals 2 to 3 years out, and then making sure we're always focusing on their delivery. In this way, our platform and content projects evolve to fuel Future's overall strategy for growth. And as we make them reality, they become business as usual activities. It's a proven method of delivering results year after year, and it exemplifies our strategy in action.
And we also apply this methodology when developing our tech stack. Our road map governs the projects we undertake. It ensures that we are aligned -- we align our technical resources and prioritize work in tandem with our horizon goals. This joined up approach enables our content, commercial and editorial teams to all deliver against their objectives, ensuring that we monetize our brands as efficiently and effectively as possible. Before Matthew talks to you about our brand development, let's take a look at our leading-edge tech stack. For some of you here, you have seen this tech stack architecture before. But for those of you who are seeing it for the first time, our tech stack continues to be our foundation upon which we build to support the organic growth for our business. From Source, our content commissioning portal, to Vanilla, which is our content creation and distribution platform, down to our monetization services, Hybrid, our AdTech; Hawk, our Ecom tech. And most recently, we added SmartBrief e-mail tech asset to the mix. Altogether I believe -- we believe makes for scalable tech foundation. But technology innovation is not just about hardware and software. Just as important is the operating framework that creates alignment across the business and allows us to pivot when needed. It's a unique formula that allows top-down, bottom-up alignment across the organization. It provides us with focus to prioritize the major projects that we believe make a difference to us. The feedback loop of this process gives us the checks and balances to inform us if our strategy is working. It is important because it ensures that we are focusing on growth that is genuinely sustainable and long term. So from left to right, we have steering to operational linked through established cadences. These allow us to constantly review progress against our agreed strategy and the execution that Zillah mentioned before. This process of prioritization and review of the outcome enables us to deliver agile development week after week, aligned to our H1 and 2 projects. And just as important, again, we are always making sure that we are also focused on horizon 3 development using the same methodology in order to ensure that we are building, again, for the future. It is an established framework but not a rigid one. Flexibility is woven into the framework in the form of the lean value tree. It is a cost-effective methodology to prove or disprove our hypotheses and strategy and then course correct, pivot accordingly. As part of it, we're constantly asking ourselves 4 key questions to keep our technology priorities aligned. What is our purpose? Does this strategy support our vision? How can we deliver this strategy? And what is the quickest and leanest way to test the hypothesis? We ask these questions of our core segments, namely platform and UX user experience, AdTech and eComm tech. Together these guide our technical resource investment against Horizon 1, 2 and 3. And to bring this to life, let me give you some examples. Starting with Source, our unified content commissioning portal, long-term investment in this tool has enabled organic growth on a global scale. How? It allows both our internal editorial teams and our freelancers to deliver editorial content in a central point that is audited and rights-managed, attached to commissions and budgets, and linked to contracts. An all-encompassing system that means we can maximize content re-use across our magazines, bookazines, website, app and by licensing partners worldwide. And that early development in Source is helping driving today's growth, as you will hear later on from Matthew. Now on to our web platform, Vanilla. It is our proven tech platform that supports all of our online operations, made up of a flexible interconnected web services that allow for content creation, analysis and management which includes multiterritory and geotargeting functionality. And it is that latter element, our ability to present content in a tailored way to specific territories, that has enabled us to grow our audiences organically. As an H3 goal, 3 years ago we decided to add multi-language onto the platform. Today, we are enjoying the fruits of our labor. We have 9 multi-language translated version of TechRadar delivered in 2019 and 11 sites launched or migrated onto the platform, including Space, 5G Radar, Bike Perfect. As if this was not enough, in 2020 calendar year so far, yes, 37 days, we've already done full internationalization of T3 and Tom's Guide and also launched German and French version of TechRadar. Now on to monetization. HYBRID, which perfectly complements the Vanilla platform. It is a true enabler to further revenue diversification in the commercial advertising space. And we have designed it to keep pace with the ever-changing advertising landscape. It offers clear benefits. Viewability. We identify the optimum placement slot on our web pages in real-time to serve advertising, giving our commercial partners the best return for their investment. Incremental and refreshed technology which sits within, leverages the time an engaged user spends on our website by automatically identifying and serving new sets of advertising as they scroll through the page. This maximizes the revenue generated for every piece of content consumed. Altogether, HYBRID supported the 25% digital advertising growth that we have experienced as a business in FY '19. And another monetization-critical asset in our tech stack, Hawk, our incredible e-commerce technology, integrating perfectly onto Vanilla. Hawk is flexible and it is used to enhance buying guides, reviews and deals content, by delivering up-to-the-second price and retailer information to our audience. It is integrated into the fabric of each site as and when they move onto the platform. Overall, it is a cost-effective, high-margin tech solution, highly automated, allowing for rapid expansion into new content verticals and brands' launches. And as Marcus mentioned earlier on, it has supported the 73% e-commerce growth we are seeing today. To conclude, following the same methodology and philosophy today, we are investing for tomorrow, living our H3 planning cycle. By developing the next-generation of tech services that would enhance the overall tech stack, namely, building the Intent Marketing tech assets that adds a new spoke to our future wheel, thus, adhering to our continued revenue diversification strategy. And enhancing Source to further boost productivity and allow editorial to focus on delivering their expert content to our growing and global audience. All in all, to deliver a sustainable, growing business at an organic level.
So the tech stack that Kevin has just described is incredibly powerful. And it's given our content teams the platforms and the processes they need to achieve some truly ambitious goals through brand development. By their nature, these initiatives are longer-term deliverables in the adjacent growth that Aaron spoke of earlier. So let's take a look at some examples of these brand development projects in a bit more detail. Back in 2016 -- there's that slide again. Our Horizon 3 strategic goal was to become the leading global content provider in technology and gaming digitally. At the time, it felt like a really ambitious target, but we also believed it was achievable if we aligned the rest of the business behind that one long-term goal. To do so, we set similarly audacious objectives for each of our key verticals. Our brand development strategies were created with the aim of becoming #1 across no less than 5 of our major sectors: technology, music, creative and design, photography and games and film, knowing that leadership in each 1 would underpin and help deliver that overall H3 goal. So in terms of our wider scorecard, how did we do? Well, we achieved almost all of the goals that we set ourselves. We celebrated becoming the global #1 technology news network, with TechRadar the #1 consumer tech site in the U.K. In music, we launched Louder out of our Team Rock assets, we acquired Guitar World from NewBay. And along with musicradar, that gave us the #2 and #3 global positions in music making. In the creative and design vertical, we invested in our website, creativebloq.com. And it's now #1 in both the U.S. and the U.K. by some margin. Over in the photography group, we launched Digital Camera World, as you've heard, and grew it within 2 years to become the #1 photo site in the U.K. And last but not least, we kicked off a major project to overhaul our games and film group, which has had a transformational effect on both our audience and our revenues. In fact, that project in 2017, to transform games, yielded a dramatic turnaround. As you've heard already, Future was founded on games. But while we've been market leaders in print for many years, we've often struggled to reflect that print success in the digital space. So recognizing this, we objectively reviewed our brands, went back to basics and used audience data to rethink our approach. The result was a brand development plan to pivot significantly towards 3 distinct content types: tips and guides, buying advice and video. We restructured and invested in our digital teams. We gave our print magazine teams the digital tools they needed to contribute, and we improved our site's global reach through platform development, as Kevin said, adding the ability for them to publish in a territory-specific way so the teams could tailor content to local audiences. Fast forward 2 years, and over the project's duration between December 2017 and December 2019, we've seen incredible growth. Our multi-format site, GamesRadar, saw a 216% increase in unique users and a 232% increase in sessions, while PC Gamer is the world's #1 PC gaming site. This also helped us to drive triple-digit growth in both commercial and e-commerce revenues, with GamesRadar e-commerce revenue up 211% year-on-year in December month just gone, alone. Now with 2020 set to be the biggest -- see the biggest entertainment launches of the decade with the PS5 and the Xbox Series X, our games portfolio is perfectly positioned to take advantage of both consumer interest and client demand. And thanks to our new colleagues at Barcroft, we'll soon be able to test monetization of high-quality long-form video content in this space, which we believe will appeal to both our huge audiences and our commercial partners in what's going to be a crucial next-generation gaming year. Our next case studies have a scalable, flexible nature of our platform enabled a 2017 Horizon 3 goal to unlock significant new revenues from a low-cost launch. Photography, like games, it's a sector we have long enjoyed market -- magazine market share leadership of. We had actually had a go at monetizing it digitally some years before back in 2014, but we closed that website way before Hawk had come along to supercharge growth of e-commerce. It therefore become a logical objective to revisit that sector online, take advantage of Hawk and further diversify our photography vertical away from print. The new website, DigitalCameraWorld, or as we call it, DCW, was an agile rapid launch. By using Source and Vanilla, a very small team could quickly populate DCW, using a combination of both repurposed magazine content and brand-new editorial. And with years of expertise in the sector, we have plenty of audience data to inform our content strategy. The data told us what audiences wanted to read, and our platform and our playbooks enabled us to deliver that content efficiently. As a result, we quickly grew rankings for the search terms we were targeting, and we were able to start generating affiliate revenues even in the early stages of the site's growth, when audiences were relatively small. If anything, our plan worked faster than we expected. Rankings and e-commerce revenue grew hand-in-hand. In exactly 2 years after launch, we were celebrating DCW being #1 in the U.K. It generated more than GBP 1 million of digital revenues at high-margin in FY '19. And as of today, it's already #2 in the U.S., as you heard, with strong momentum behind it. Ultimately, it's a powerful example of our strategy in action, delivering a long-term goal, leadership in a key sector and unlocking significant revenues that we enjoy today. So we've talked about the development of existing brands and a new launch, but the way we approach long-term brand development can also be applied to our acquisitions, enabling us to optimize our assets as part of the integration process. That was a philosophy behind one of the key Horizon 3 goals in 2018. To ensure that we focus as much on the optimization of our acquisitions as their integration. And since no 2 acquisitions are the same, we make sure our optimization plans are always bespoke, tailored to maximize the value of the acquisition and reviewed across several key areas. For example, we look at how effectively we can move the newly acquired brands and teams over to our tech suite, how fast we can train them and given them the smoothest start to the expanded organization. We measure how efficiently we can drive e-commerce revenues and improve commercial monetization through both the sales team and the ad technology. And all of these factors came into play when we reacquired the TeamRock assets, which included Metal Hammer, Prog and Classic Rock. As part of our wider music vertical, we quickly discovered that there was more opportunity in this space than the TeamRock brand we'd acquired, allowed us to realize. The very brand itself TeamRock was actually constraining success since it had far less traction with audiences and clients than the content itself. Our optimization plan was, therefore, more wide-ranging than a typical acquisition. We developed a completely new brand for the content, Louder, which we felt better reflected the diversity of the content and would allow us to relaunch and go-to-market with an exciting new vision. As a replatforming project, there was a large amount of editorial to migrate to Vanilla for multiple content management systems. However, as Kevin described, the flexibility of our platform and our tools enabled a fast, efficient content migration. And as in games, we also trained the relevant print magazine staff to use the website tools, embedding new skills throughout the business and scaling our digital workforce. The results were compelling. Just 3 months after launch, the all-new Louder had overtaken the previous TeamRock site's global uniques. And within 12 months, it was attracting 3.2 million global uniques, up 110% year-on-year. And that growth story has continued, with the recent report identifying Louder as the fourth fastest-growing website in the whole of the U.K. during 2019. So in summary, Horizon 3 is about setting longer-term goals, 2 to 3 years out. And it's critical that we're always working on these long-term goals in order to keep delivering growth today. Our laser focus on our strategy and the alignment behind it extends throughout the business. And it's by all moving in the same direction that we succeed. Our platform and our content systems are a critical part of that success. The scalable, flexible, robust framework of our tech stack enables our content teams to deliver their editorial in a highly efficient way, maximizing its value in all territories and monetizing at all points through the Future wheel. And it's a truly flexible approach that can deliver a wide range of projects as you've heard, from root and branch transformation of legacy brands, to new launches, to the optimization of acquisitions. Ultimately, by always having a consistent focus on our future goals, we ensure that we deliver sustained ongoing growth today. Thank you for your time. I think [ I should get another ] coffee.
Welcome back, everyone. Good afternoon. My name is Chris Convey. I'm the Senior Vice President of B2B here at Future. And I've been with the business for pretty much bang on 4 years. And as you can see, I'm here to talk to you today about the acquisition playbook. Actually, whilst the slides say I'm here to talk to you about acquisitions, I actually think I'm also here to talk to you about strategy and how we deliver it. As you've already heard today, we have a rapidly growing business, which we are continually looking to diversify through moving into adjacencies, new verticals and by building out our platform. We do this every day organically and will continue to do so. Where our acquisitions come in is, they supercharge that growth. Our acquisitions complement and accelerate our organic growth rather than replacing it. With that in mind, let's have a look at our approach to acquisitions. We think we are good at acquiring the right businesses for us at the right prices. But we're very conscious that we aren't a PE house or an investment fund. We are an operating business that wants to find complementary acquisition targets that fast track our growth. As such, we recognize that we only have limited capability to [ transact ]. So we are very selective about what we go after. Importantly, at Future the executive team are highly involved in the acquisition process. We believe that our real value-add is to improve the operating performance of the businesses that we acquire. So having those who will deliver that improvement involved in the acquisition process is crucial. At the other end of the timeline, we hold ourselves to account. Once we have bought and fully integrated the new business into Future's operations, we always ask ourselves, did we do what we said we'd do. Where did we pivot our plans to unlock further value, and were there things that we could have done better for next time. Anyway, we'll come back to that later. Finally, in terms of the process and how we actually go about identifying deals, transacting and then delivering on the business case, we've built a robust playbook over the last 3 years to make sure we deliver the most value as effectively as possible. When thinking about acquisitions, we break them up into 3 broad categories and use a 4-box grid to talk about it. I should point out the box -- the grid is directional and I promise you, the 4 boxes make sense. Our acquisition planning starts with a rolling 3-year plan. We identify areas of growth and opportunity for the business, look at where we believe we can deliver organically and then start to target acquisition opportunities to fill in the gaps. Depending on what we're looking to achieve, these could come in all sorts of shapes and sizes, of course. Generally these break down into 2 main investment types, transformationally strategic or operationally strategic deals. Transformationally strategic deals, those in the top right-hand box in the grid, are those that significantly increase EBITDA and come at a higher price multiple reflecting revenue mix. They come with higher degrees of operational complexity, and hence we're very careful about how many of these we take on. We've actually averaged about 1 a year over the last 3 years. Imagine at the back end of our FY '17, Purch right at the end of FY '18 and TI in this financial year. As you can see, the nature of what constitutes a transformational deal has changed over time as we've grown. From magazine consolidation play with Imagine to U.S. online consumer tech growth with Purch and to doubling the size of the business with the large online and U.S. growth opportunities through TI. Smaller deals that we target through our process are deemed operationally strategic. These have 2 general flavors, either higher EBITDA revenue businesses, but with lower multiples because they're more print-based, such as NewBay or potentially Centaur. NewBay was still strategic though, as it gave us B2B and a U.S. presence. Or in the bottom right-hand side of the 4-box grid, lower EBITDA but higher multiple, faster growth, digital media businesses, such as Barcroft or Mobile Nations. Finally, in the bottom left-hand corner of the grid we have tactical deals. Whilst they still meet our strategic filters, they're much more reactionary to what's going on in the market, and they're primarily tuck-ins. For example TeamRock, which we acquired from the receivers over Christmas in 2016. As I've said, our acquisitions complement and accelerate our organic growth. We look for targets where we can add real value as experts, such that over time our acquisition and organic paths to executing strategy, fully harmonize. At a top level, I think there's 3 main ways this can happen. And there's examples of each of those on this slide. On the left-hand side, we have acquisitions accelerating our organic growth. Consumer tech is a great example of this. Consumer Tech has always been our core strength, and we've grown significantly organically, both in the U.K. and the U.S. The Purch acquisition in 2018 helped accelerate our growth in the U.S., but it wasn't until we applied the Future best practice to the Purch brands, as Aaron talked about earlier, that we actually grew to take #1 spot. So we look at organic growth on top of acquisitions. In the middle column, we have acquisitions which help us move into a vertical or out to our platform capability. For example, we entered the Home Interest category through the acquisition of the Centaur home interest portfolio. However, once we bought that portfolio, we again applied a Future business model to radically change the online proposition to relaunch realhomes.com and to grow organically with real success. Finally, on the right-hand side of the slide, we have acquisitions on top of acquisitions. Our hobbies vertical was created following the acquisition of the Field Sports titles in 2016. Once created, this vertical made it easier for us to acquire in other adjacencies, and that's led to deals such as 442, Practical Motorhomes and caravans from Haymarket and Cycling News and Pro Cycling from Immediate. However, once we've taken those acquisitions, we've then grown them organically as well; for example through the launch of Bike Perfect, as Zillah discussed earlier. As a result of this merger of organic and acquisition activities, the pond in which we can fish for acquisitions is actually growing. As we move into adjacent markets, add new wheels to Future or more spokes to our wheel, we actually have greater range of targets we can legitimately go after. Over the last 5 quarters, we have reviewed 142 opportunities, which demonstrates our growing and diverse pipeline. Just over 50% of the opportunities reviewed would have allowed us to increase our position in current verticals or move into close adjacencies to those verticals. The balance would have given us either new verticals or wheels such as finance, pets or parenting, or else would have given us more spokes to our wheels through additional platform capability, such as data, lead generation or price comparison functionality. We therefore think that there are enough opportunities out there for us to continue acquiring the right types of business for us at the right pace for us. So as you heard earlier, we are all about the purchasing funnel here at Future. And the M&A team is no different. So here's ours. Overall, it probably looks pretty familiar to most of you in terms of process. But there were a couple of bits that I wanted to pick up on. Firstly, we are extremely picky about what deals we take forward and why. As I've already said, we are primarily an operating business so we only had capacity for a small number of complementary acquisitions. Based on the acquisitions -- opportunities we've reviewed in the last 5 quarters, we properly review 15 deals to complete one. This ratio is actually increasing, which means that we are becoming more picky as we have a wider range of opportunities to consider. Secondly, as Future employs experts in their markets, we generate around 40% of the opportunities we review from within the business. This of course helps with strategic alignment with the day-to-day operations. Thirdly, we have a really strong gating process in place to make sure we manage the process as effectively as we can. As I mentioned before, Executive Management are involved from early on, particularly in the review and DD stages. This involvement not only ensures we get the best insight on the opportunities, it also means that we can start planning for how we would integrate and operate the new businesses whilst we're reviewing. At heart, we are operators who add value rather than dealmakers who operate. We focus on delivering business cases and improving performance, regardless of whether the investment was organic or through acquisition. Our acquisition investment cases are built on delivering cost savings, as these are more certain than revenue upside. And operationally, our focus is to deliver that business case as rapidly as we're able. We of course look to deliver revenue upside where possible and approach a best of the best approach when evaluating go forward operations. Within our playbook, we have standardized our approach to the realization phase of acquisitions. No 2 deals are ever the same, but there are similarities across the board. So we subdivide this process into 3 stages: integration, transformation and optimization. We operate a fully integrated acquisition model. And once we've confirmed our diligence assumptions, we look to integrate the back-office functions as rapidly as we are able to realize cost savings. Transformation involves rolling out the Future wheel to deliver new revenues where appropriate, to share best practices and to review approaches to audience, websites and the like. Where we've acquired a portfolio with noncore assets which we plan to dispose, this normally also happens during the transformation phase, although obviously we look to do this as early as possible so we can delever. Finally, we move to the optimization for these on the right-hand side of the chart. This is where we leverage the combined power of the 2 businesses to launch new products, drive yield and increase revenues. We're flexible around our approach here. For example, when it comes to revenue upside, we certainly don't think we know best, especially when we're moving into new markets. We're agile with our plans. For example, as Matt outlined earlier, we're happy to relaunch or pivot brands such as Louder as necessary. I've already told you that holding ourselves to account is something that's fundamental to us. We need to make sure that we deliver what we promised we would, but we also want to learn how we can improve our model for next time. To give a live example, here's a summary of our closeout of the Purch acquisition, which we did recently. In answering the question, did we do what we said we'd do for Purch, the answer is a resounding yes. As the slide shows, we delivered on all of the financial outputs in the business case. However, financial performance is only an outcome of us getting all their operational delivery correct. So if you look at the middle column, we have a number of operational successes of which we're particularly proud. To highlight one, I'd just like to briefly focus on the best of both worlds -- hybrid programmatic solution that we built. This is a great example of us delivering a best of the best product, taking what Purch did well and what we did well to deliver a combined product that increases yield way beyond what either us were doing independently. There are, of course, always things that we learn for next time. In this case, perhaps it's most important -- most importantly, it was that not all companies speak the same language. It may sound really prosaic, but it's really important to listen to what people are saying, regardless of how they say it, so that we really understand what's going on under the hood of the businesses that we acquire. So having given you a deep-ish dive into Purch, I thought it would be worth recapping on how the acquisitions we've delivered to date have performed. Fundamentally, whilst we've acquired a wide mix of types of deal with different associated multiples, all our acquisitions have been successful. This table only shows those deals we have fully closed out, but we're confident the whole portfolio are on track to deliver. Before I close out, though, I also thought it would be helpful to go through a few more examples in detail, the different types of deals, to highlight why we think they've been successful. So NewBay. Oh, that's loud. NewBay Media is extremely important strategically to us, as it gave us both a foothold in B2B and was our first U.S. expansion as we looked to geographically diversify. NewBay also gave us the opportunity to consolidate a market-leading position in music in the U.S. through their consumer music portfolio. As you are likely aware, we purchased NewBay as a distressed asset from their creditors. So from the outset, we saw this as a low-cost route to enter B2B and our investment case expected revenue to decline. NewBay was extremely print-dependent. And whilst they had a range of online and e-mail content solutions, their offerings were extremely basic. Since we've taken ownership, we've added significant value despite those revenue declines and we remain confident of delivering on our business case. After we reviewed the portfolio in detail, we also sold 7 of the legacy NewBay brands that are either loss-making or non-core to Future and didn't fit with our verticals, for example, to [ our news ]. NewBay provided us with a low-cost opportunity to learn more about B2B and we have used those learnings to launch our own B2B brands, such as 5G Radar, Next TV, and Tech & Learning University as well as to identify spokes to add to the B2B wheel such as SmartBrief. So those of us who have been to these sessions before will have no doubt heard Zillah talk about strategy and how we describe strategy here at Future as being a series of intentional steps. Our decision to look for a B2B e-mail business with a large audience was very much an intentional step following the acquisition of NewBay. We recognized the need to build our capabilities and SmartBrief provided those capabilities as well as a unique and valuable audience. Strategically, SmartBrief gives us a defensive position against search as we own the audience and have a direct one-to-one relationship with them. SmartBrief, therefore, adds spokes to our wheel but not just for B2B. We believe the platform can also be used to add value to our consumer business in a similar way. We are really happy with the strong growth that we're seeing in SmartBrief since we completed our acquisition. Over the previous years, SmartBrief has been stable, whilst they invested in new products and start to fuel growth, which is why we put in place the earn-out structure with the deferred element only payable if the growth was delivered. These investments that they made are paying off. And so we are, somewhat perversely, happy to be expecting to pay out on the earn-out. So time for some more intentional steps. So when we acquired SmartBrief, we did so with an earn-out structure as part of the deal. The reason that we knew we could do this is that we'd used a similar structure before when we acquired Mobile Nations earlier in 2019. Mobile Nations is also an example of another deal type as they were a partner of Purch, who we had bought 8 months earlier, which whilst it complicated some things, also made our revenue diligence a lot easier. Mobile Nations was 1 of Purch's publisher services partners. This means that Purch, and then obviously Future, sold all of Mobile Nations' ad inventory on their behalf, leaving Mobile Nations to focus on their core e-commerce monetization that Kevin was talking about earlier. This intercompany trading, though, meant that the numbers were pretty hard to follow. If you look at the table on the slide, the left-hand column is the Mobile Nations' stand-alone P&L when we bought the business, with $16.4 million of revenue, $8.7 million of costs for a net operating profit of $7.6 million. However as we were trading between ourselves, their revenue number included $7.2 million of ad sales that we had sold them. And correspondingly, our cost of sales included the same number. So when you eliminate this to get to a consolidated Future view without any double counting, which is the middle column on the table, the incremental impact of the Future P&L is slightly odd-looking at the top level, as the incremental costs are so low. You can see that on the right-hand side. However, fundamentally the operating profit gain is the same. I hope that's clear. So let's move on. Our most recent acquisition is Barcroft, as you know. I think there are an awful lot of similarities between Barcroft and Future, which is why we were attracted to them. Sam is going to tell you more about this in detail, so I'd steal his thunder. But in summary, like Future, Barcroft are focused on producing evergreen content with a scalable and highly effective platform and operating model. They also follow a lean product development process through which they leverage their large social following to market test products before they roll out more fully. Strategically, barcraft also delivers diversification in our audience and revenue sources as well as accelerating our knowledge of off-platform algorithms. So final slide and recap time. If I could leave you with 3 thoughts, it would be these: so our acquisition strategy is merely part of us executing on our wider corporate strategy and complements our organic growth plans. Our acquisitions to date have all been successful and contain a variety of different types of deal. And finally, as we know, there is no 1 deal. We need to remain disciplined on price, follow our process, but we really do have a big pond to fish in. So thank you, and over to Sam for some video action.
Thank you very much, Chris. Hello, everybody. I'm Sam Barcroft, and I'm the Founder and CEO of Barcroft Studios, and I'm very excited to be here today to introduce the company to you. We joined the Future family in November, so we're brand-new here. And Barcroft is fundamentally a producer of premium video for digital platforms and for television. And if you have any teenagers in your life, they're probably very likely to know all about our shows. So as Chris said, I've made a video, because I thought that would be the best way to introduce what we do to you. [Presentation]
So at Barcroft, our mission is to inspire the world through amazing true stories. And how do we do that? Well, we work in 2 major ways. The first way is to make our own exclusive video shows, which we monetize across third-party platforms via advertising and licensing revenues. We made and we own over 2,500 episodes of these shows to date. And secondly, we produce original television shows for major broadcasters like Netflix, our previous investors, Channel 4 and the BBC. And at Barcroft, we're both a video publisher and a producer, which is rare. And it does mean that we can create value and income on both sides of the aisle. This helps us to create efficiencies and to add value throughout the business. So after 25 years in the media, working across newspapers, photo agencies, online and in television, I know it's vital to have a robust business model. And the Barcroft Studios business approach, which we formulated and then rolled out over a year ago, is largely based on the Hollywood movie studio business model, which was adapted by us for the digital-first video age. And what that means is we create original content, which we wholly own. We use it to build big audiences. And then the team sweat every single show, episode and story across multiple revenue opportunities over time. And I suppose if you hear a recurring theme here, it's that 1 of the reasons we chose to be acquired by Future last year is because when we met with Zillah and the team, it was quickly obvious to myself and my colleagues how similar our business culture actually already was. So we share a number of the approaches that you've heard about today, which we think are fundamental to success in the media and in many business types, I suppose: diversified revenue streams, evergreen content and product, and efficient production model, which we call our video speedy system; a minimum viable product approach to innovation and a deep understanding of data and relationships with the platforms that we partner with. So it's really exciting for us to be a part of Future. Because Future are delivering that approach on a grand scale. And so as Zillah outlined at the top, Future focus very much on being #1. And over the last 12 years of making video at Barcroft, we've hit the top spot multiple times. And it's what motivates my brilliant team of young producers. They love being #1, and our work is recognized by our peers. And actually last year, we beat BBC 4 and National Geographic to be awarded the factual channel of the year (sic) [ Best Factual Channel ] at the Broadcast Digital Awards, which is the first time a non-broadcasting company had ever won it. So we've built deep relationships with the FAANGS: Facebook, Apple, Amazon, Netflix, Google and Snapchat. And we also know the television world very well here in the U.K. and in the U.S.A. But how do we make money? We're a digital business. Well, a lot of people love our content. So to ensure we continue to exceed their expectations, we've created a business which gives us multiple income streams. As you see on the slides, we make TV shows for broadcasters. We publish our shows on social platforms like Facebook, YouTube and Snapchat. And that content gets millions of views every day. And the platforms split the advertising revenue with us. The better it does, the better we do. And we're now at the forefront of creating bespoke digital and social content for clients who are keen to move into the future, like Channel 4, and for major platforms like Snapchat and Facebook. And finally, we license our content to broadcasters like Sky Q, RTL and ITV, and we work with non-publishing brands who want to reach people through high-value content, like the National Citizen Service, in a project that's going out this week with Channel 4; Dove, Playstation, EE and others. So at Barcroft, we love efficient innovation, creating disruptive new products, and the digital world allows us to do that at low cost. We enjoy figuring out how to deliver huge value for our audiences and our clients so that we get to stay ahead of our big -- mostly bigger than us competitors, until now. So one of the benefits of having over 60 million followers on your social -- not personally, obviously; corporately -- is that you get a huge amount of feedback on your shows, of all types, it turns out. And so we use our social platforms to incubate our show brands and talent to test and learn, and we use that to evaluate popularity and success. This gives me a great advantage with broadcasters. So when I turn up to the BBC or arrive at Netflix. I cannot just give them an idea or a concept for a show, but I can take hard data that shows the popularity or the likely audience outcome of a show. And that gives me a massive market advantage. So making that is a great example. Back in 2017, we saw our audiences on YouTube especially love Making Mad episodes about Remarkable Homes. So our TV development team looked at the data and used it to develop a number of long-form show pitches. We took that data and the creative out to our clients and convinced them to commission 2 long-form original series, which were Amazing Interiors, which is still on Netflix if you're bored; and then also Most Incredible Homes, which was 1 of Facebook's most innovative early original shows, which used polling and 360 as an integral part of a TV show. So the great thing about our video-on-demand is that it earns money while we're asleep. And this is uncannily like Kevin's favorite chart from earlier on. But actually we made this chart about a year ago. So it's funny how these things line up. But serendipity says that it's the same idea, we made over GBP 1 million of revenue in 2018 from content that we've made in previous years on video-on-demand, on platforms like YouTube. So the good news is that video as a marketplace is on a roll. Globally it's a very exciting area to operate in. Demand is increasing across both sides of our business. Advertisers are spending more on video as there's a huge consumer uptake in free-to-air television via OTT and social media. And as the chart on the right shows, streamers and broadcasters are spending ever more on commissioning original series, as they all fight tooth or nail for market share of that lucrative big market. So by rolling out original shows across our many brands and verticals, we're able to tap into this huge global marketplace, which is growing at pace. And at Future, this now offers us a great opportunity to grow our income across the businesses. In terms of our TV production business for broadcasters, we're busy making shows for a broad range of clients in the U.K. and importantly, in the U.S. But how are we taking advantage of the increasing demand for all this quality video, especially from advertisers? Well, as well as all the in-house video production at Future that's already ongoing, that you saw figures on earlier, the Barcroft team will be increasing its original production of shows to 400 episodes this year across 12 show brands. And we're also very excited to announce today that we'll be rolling out our new OTT channel this year, which effectively means we'll have our own first television-style scheduled channel which will broadcast 24/7 into people's set-top boxes and TV sets. Truly will be the home of popular documentaries and it will be available across both social media and on multiple OTT platforms. It will feature our own Barcroft shows and will also include well-known TV series from third-party providers. And we'll test and learn on Truly to see how we can best scale Future's brands into the exciting new world of TV broadcasting. So this allows us to control our own distribution as a group even further, by going direct-to-consumer in connected television. So in summary, we're taking the best practices in show distribution network, which we've developed over a decade at Barcroft, and we were rolling out at Future. We're extending video across social, online and into TV broadcasting. Our colleagues in the sales teams in the U.K. and in the U.S.A. will now have premium original video stories to sell, which is an exciting new product for them to work with. And revenue generated by selling against our new shows, plus the new advertising income, will provide additional revenue streams for our brands and also offers the opportunity at Future to grow new audiences too. And as 5G rolls out globally and people start to consume even more video, we'll be perfectly positioned to deliver standout shows both across mobile and on our larger screens at home. So thank you very much for listening to me. And now to pull it all together, I'd like to hand over to Penny.
Thanks, Sam. So for those of you who don't know me, I'm Penny Ladkin-Brand, I'm the CFO at Future. I've been with the business for 5 years now and it's been a really exciting journey, just building the foundations, but especially after hearing Sam speak, I'm even more excited about the journey ahead. So I just wanted to pull all the things that we've heard together from the team about how we execute on the strategy, how the technology underpins our platform and how we think about diversification and complement our business model through acquisitions. So I wanted to put that together by explaining our global operating model and how this flows through into attractive financials, facilitating organic media revenue growth, and how that change in revenue mix drives profit and cash generation. So I wanted to start with our organization design, as we think that the org design very much influences how we think about the world. And one of the unusual things about Future is that we're organized as a matrix. So the leadership team is made up of functional leaders. The second unusual element is, that matrix is spread around the world. So 40% of the leadership team are in the U.S., we've got an MD in Australia, and the rest is in the U.K. This makes for some really interesting diary scheduling. But it also, much more importantly, it means that our outlook is very much global as it frees us up to think about our biggest audiences and what do they need, and not about the needs of those local markets. It also means we're very much in the habit of operating virtually, as everything happens on a Google Hangout. So even as we've been pulling together this deck over the last week, we've had multiple hangouts with people from Florida, Miami, Barcroft Studios over in Shoreditch, and it's been an amazing experience to kind of really integrate people into the Future family. That makes things really efficient, but it also means that it's a really scalable model. And as we grow, we can have anyone join a meeting from a different office location. 2 years ago, one of our What's Important Right Now initiatives was to think U.S. first, because we really wanted to achieve scale in North America, where there are significant digital advertising budgets. The global operating model has really helped us to achieve that scale in the U.S. Our content reaches 1 in 3 people online in the U.S. So 1 in 3 people online are on our sites every month. And 40% of males online are on our sites. So we've really already achieved quite significant scale. So when we think ahead to onboarding TI media, we're very much thinking of this as a global opportunity. Today these are largely fantastic domestic print titles, but the opportunity for us is to create significant online brands from the content reuse and the content expertise. The markets in which they operate are large, in fact they're pretty enormous. And we can see that there is interest online in these subject matters. So we really feel there's a clear opportunity here. And our global operating model will help us unlock that. The other element, which we have found it to be relatively unusual versus our peers and the other businesses that we've looked at, is that we operate centralized centers of excellence, which are in our lower-cost locations. So most of our back office functions: finance, [ belief and ] culture, audience development are all in the U.K., particularly in Bath. And technology is spread across the U.K. and also in France. The roles which are important to have in market, we retain in market. So sales and marketing, editorial and some event support are local. This model is adopted for each and every acquisition, but the back office quickly integrated into the central teams. This can feel like quite a big change. And it's, therefore, not for everyone. However, this does provide us with good controls, and we have a much better full visibility of performance, and importantly cash, from day 1. This also means that we can react and really lean into opportunities that we're seeing quickly and put further investment behind where we have momentum. The other element of the operating model that we've seen a lot of today is to ensure that we have consistency as we scale. So we think that it's important to have a consistent methodology in order to operate effectively. And therefore, we have got a playbook approach to how we -- to everything we do. Effectively a playbook is writing it down in a manual, but it sounds a lot more glamorous when we call it a playbook. But what this allows us to do is we take the learnings and iterate the playbook and improve it as we go. It really helps us onboard new members of the team. And it means that our newest members of the team can be as talented as the most talented members of the team. But it's important to know that we have checks and balances in place so that we can monitor how we operate. So we have lots of dashboards in every team, but we also have our overall acquisition balance scorecard, which is 1 of our -- our 1 quantitative diagnostic tool, which helps us assess, in an objective rather than an emotional fashion, whether we have any indigestion anywhere in the business. I'd like to pretend that it looks like this glamorous-looking BI dashboard on the computer screen there, but it's actually the really ugly Google sheet that you can see hidden behind it. But I thought I'd share the authentic view of how we operate. But whilst being an ugly sheet, it's actually super useful to make sure that we don't overstretch ourselves and check on the progress of how we're bedding in all the acquisitions. The next element of the operating model I wanted to talk about, is the platform and how that drives growth. So Kevin Li Ying earlier told us about the content management system that we've really invested in and grown over the last couple of years, which essentially allows us to republish 1 piece of content multiple times. So this is a good example of it here, that you can see we've published an article which is featured both in a magazine and also online. But then that magazine article has then also appeared in many different formats, so a licensed edition, an annual, an app, a Bookazine. And then that Bookazine itself has also been licensed and also appeared in an app. So from that 1 piece of content, many products have been created, and this really helps us drive the margin. And as we have many different audiences who appear on our sites with different user behaviors and whilst we have multiple routes to monetization, this allows us to tailor the monetization route to the different audience types and their needs. So unlike the usual 80/20 role with the repeat customers generating most of the money, the casual intent visitor will often generate a return through e-commerce content, as the e-commerce content also provides a material revenue stream. And so we can see how that plays out in revenue in this example here, so we're actually not able to create the evergreen content chart that we saw in the MoNa and the Barcroft slide. So this is my next closest alternative, which is an example of 1 article, which is a buying guide, and how that revenue view builds over time. So you can see that this is an article which was first published in January '18 in the U.S. edition. The 2 red lines are the page views and the revenue, cumulative over time. So you can see that the investment in the original article pays back within the first 3 months. And then the revenue continues to build. The article is then localized into a U.K. edition to ensure it caters also to a U.K. end audience. And then it also appears in the licensed edition. All of these drive additional monetization. And you can see how 1 article can be published in different geographies using the platform, and continues to generate a return month after month. So I wanted to pull that together to show how that drives the overall revenue picture. So this chart shows the bridge of the FY '19 organic revenue performance and the key drivers of it. We heard of it a lot today about the audience growth. So we know that our organic audience growth in FY '19 was 31%, which translated to 32% of organic media revenue growth. And you can see here the drivers, which is really the digital advertising, which grew 25% and e-commerce at 73%. Magazine revenue declined, very much in line with our expectation at 10%. And we also had a big event which moved into FY '20, causing a small decline in the Other Revenue stream. So all of that rolls up into the 11% overall organic revenue growth. But I thought it might be helpful to explain clearly how we define organic growth and why we like to do it like this. So what we're looking to do with our organic growth measure, is look at the mature portfolio of assets to make sure that these are growing, as the best indicator of the long-term sustainable growth rate. So an acquisition drops into the portfolio once it's been a part of Future for at least 1 full financial year, so that we have a complete comparative of audited financials. We're aiming to do this to be the best determinant of Future growth. So we don't adjust for closures. So if, for an example, we closed a magazine title as we have a big portfolio or an event, we don't remove that from the baseline comparator. So that organic revenue growth, we think it's an important leading indicator, but we also think it's important to look at profit and cash. As above all, we're interested in the quality of the revenues. But just to finish off, I provided here an illustration of how we calculate that 11% organic growth rate. And if we think back to Chris's talk earlier on acquisitions, that one of the things we're looking for in an acquisition is to make sure that we can add value. This means that the revenue under Future in the first year or so might be lower than pre-acquisition, either as it's a print asset, which is declining, or we've closed or sold elements of the business which are unprofitable. So we heard about the NewBay example, where we sold 7 of the titles. So the FY revenue for '19, revenue from acquisition, is about 7% lower than the previously reported revenue. So I thought it might be helpful just to see that fully played out in a calculation. So with some of our revenue streams declining, how do we drive growth? We do that by changing the mix of revenues to higher-quality revenues. So 2 of our digital revenue streams that we have a very high margin. Digital advertising is around 70% margin on a net basis. And e-commerce is actually over 90%. So as we build these within the organic portfolio and grow them out also across the newly acquired assets, these really help the operating leverage within the group. So you can see that played out here in the P&L, which is -- so therefore in '19 P&L. And so you can see we managed to achieve 70% mix of the overall revenue mix was from media. Because it's higher margin, the gross contribution was 75% media. And so you can see on the -- in the column on the right-hand side, the percentages increase as we go down the P&L. So the total revenue increased by 70%, growth contribution by 80%, and that flows through to 163% growth in EBITDA. And the same story plays out also in the cost base, with the operating leverage just flowing through. So we don't need to scale the direct or the administrative costs at the same rate as the revenue growth. So in FY '19, the EBITDA margin grew overall by 9 percentage points to 25%. And we certainly can -- as we look forward with the business, can see further margin expansion from here on out. This is the last chart, I promise. So -- but I really wanted to give a good insight into how all the amazing aspects that the team have talked about today, play out in the financials, as I think it makes for a really attractive business model. So this is the chart that I included in the FY '19 results presentation. We've colored it in since, but it's essentially the same one, so -- because I thought it was useful to see how the operating leverage plays out. And so this shows the drivers of the FY '19 growth, split into organic, which is the GBP 5.9 million in the first column. And then the FY '18 acquisitions. Now this is the pro rata of the pre-acquisition EBITDA. So the -- what we acquired, which wasn't in the previous year, played out here. And then the delta is essentially the platform effect. As we integrate everything in full, our organic growth rate is essentially inherently a little bit understated, as the additional costs to support the acquired assets appear in the organic. But in any case, at 29% growth rate, I think we'd all be happy if we continue to achieve that even without acquisitions. So we're very pleased with that performance. I couldn't finish, though -- I did say it was the last chart, but this is a common one, it's different. And I couldn't finish though without talking about cash, which is the ultimate barometer of the quality of our profit. So the chart here shows the EBITDA and the free and net cash flows over the last 4 years. So you can see how closely cash tracks EBITDA. And as we've made the big step changes in the EBITDA margin, how that flows through to EBITDA and cash closely follows. So I hope I provided a bit more detail on the global operating model, which we very much think of as the foundation stone of our business model, and we really think will underpin our growth as we continue to scale. Thank you.
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