Sto SE & Co. KGaA

Ladies and gentlemen, welcome to the Q1 figure 2021 conference call of Struhr SE. At our customer's request, this conference will be recorded. As a reminder, all participants will be in listen-only mode. After the presentation, there will be an opportunity to ask questions. If any participant has difficulties hearing the conference, please press Sparky followed by zero on your telephone for operator assistance. May I now hand you over to Christian Schmalze, Co-CEO, who will lead you through this conference. Please go ahead.

Dear ladies and gentlemen, thank you for joining our Q1 results call today. Together with our founder and Co-CEO Udo Müller and our CFO Christian Beyer, we will present the financials for the first quarter 2021 and give more information about the current business dynamics across all segments but especially out-of-home media during the pandemic, how our financials developed in Q1 across the various businesses and sub-segments, including an update on our ESG initiatives. And we wanted to take the opportunity to make a deeper dive into the development of ASAM and what our strategic roadmap looks like before we close the presentation with the outlook for the coming months. Since meanwhile, more than one year, we are facing the challenges of COVID-19 and Germany was the full first quarter in a hard lockdown, with all shops and restaurants closed and significant restrictions on public life. So the total advertising market, but out-of-home media specifically, were suffering. Nevertheless, our out-of-home plus strategy gives us a really robust setup for this crisis versus pure players, and all long-term strategic business drivers are fully intact. In the first quarter, we focused on a tight management of the semi-flexible out-of-home cost structure as already last year, but we tried to handle this in balance with strategic long-term targets and negotiated with all business partners in a reasonable partnership-oriented way. However, certain methods like rent adjustments are still work in progress and therefore not fully reflected and effective. We expect our out-of-home business rebounding in V-shape as soon as audience and the ad market recover after the lockdown. At the moment, a vaccination quota of around 45 to 50% of all adults in Germany in the next four to six weeks seems to be realistic. And learnings from countries like Israel and the UK show how quickly infection rates go down afterwards and consumption climate and public atmosphere improve immediately. Our non-out-of-home businesses, digital and dialogue media, as well as DARS and e-commerce, have been strong during the crisis and also in Q1. They were operating overall in normal or even better mode. We have observed in Q1 again the further trend towards more digital media in combination with a stronger focus on technology, programmatic trading, and data products. Given our leading market position in online and digital out-of-home media, we are convinced that we will gain market share in the already beginning recovery phase. Our diversified client portfolio, from local SMEs to large national key accounts and across all industries, has clearly helped to protect our top line in the first quarter. When we compare Q1 with the previous year's Q1, please keep in mind that this quarter was still pre-corona with basically no significant negative effects from the pandemic. All in all, the reported revenues of Q1 2021 for the group was 312 million Euro, down by 15% compared to the previous year's quarter. Organic revenue development was on the same level. the adjusted EBITDA decline overproportionally by 37% to 73 million euro compared to 117 million euro in Q1 2020. Our adjusted EBIT was down disproportionately compared to EBITDA from 48 to 8 million euro, mainly due to the basically unchanged DNA volume compared to Q1 2020. Accordingly, Adjusted net income was down 97% from 35 to 1 million euro. Operating cash flow for Q1 stands at 27 million euro despite the full quarter lockdown. Driven by phasing effects in our spend, capex for the quarter was 14 million euro, some 49% below previous year's quarter. In the coming quarters, we will accelerate the ramp up of our digital footprint, especially for digital road time screens. and expect a full year capex spent at least on prior year level. So overall, our Q1 revenue developed at the upper end of what we had guided and expected mid of March. In essence, only our out-of-home segment was impacted by COVID-19. There were very cautious pre-bookings for Q1 as the current lockdown already started in November last year, and many clients decided to hold back money unless they have clarity about the pandemic impact for 2021. Nevertheless, given the fact that the whole quarter was in lockdown, the impact was less sharp compared to Q2 last year, when only five weeks were impacted by massive restrictions of public life. Local sales were still growing in Q1, and we had no problems to get in touch with our SME customer base. But national sales, campaign business, and transport media were going backwards so that the total out-of-home business lost 46% revenue versus a really strong Q1 2020. A completely different picture in the two other segments. Digital and dialogue media grew 5%. The digital business was slightly weaker at Easter campaigns than expected, but especially our news portals, the online and Watson, were strong. The contact centers as well as the door-to-door business grew beyond 20%, although there were some smaller operational challenges around lockdown restrictions. Similar to the second half of last year, DARS and e-commerce, Statista and Asam continue to accelerate their growth, and revenue was organically 37% above last year's Q1. Statista slightly ahead of its historic CAGR, and Asam especially strong in sales via the own shop and digital platform. As all plus businesses consistently deliver as in pre-COVID times, The key question is how the out-of-home business will recover during the coming and hopefully final months of the pandemic. So how does the order inflow convert into monthly revenues for our out-of-home media segment since the beginning of this year? On the left side of the chart, you see monthly revenues 2021 versus 2020. January and February were clearly weak, but the two months don't count for much more than 11% of our annual business in normal time. March was already better, but we have missed large parts of the Easter campaign business due to the prolonged lockdown and the beginning third COVID wave. But with the accelerating vaccination, April was already above prior year, and we have seen more and more campaign bookings materializing for May and June. Both months will be probably 60 to 100% above 2020 comparables. But we are looking at COVID 2021 versus COVID 2020 in the second quarter. So how does the current dynamics compare with 2019 and pre-COVID levels? That's what you find on the right side of the chart. We see continuous improvement month over month since the beginning of the year. And in May and June, despite the lockdown, we are probably only 15 to 20% behind 2019. In case the lockdown ends sometime in June, vaccination dynamics increases as expected so that we get closer to herd immunity in July We should see 2019 out-of-home spending levels and beyond in the summer months again. And the plus businesses have a consistently robust outlook, also based on Q1 initiatives and achievements. Despite the lower demand for our out-of-home media, we have worked on our mid-term opportunities and added more than 100 new roadside screens in Q1 in 16 different cities. We see how COVID has accelerated the demand for digital media products in general, and we prepare our infrastructure to benefit from that trend in the recovery phase and beyond. G-Online, the largest acquisition we have made in the last eight years, had again a really strong start into the year. And it's not only COVID-driven momentum for a news publisher, it's the logical consequence of our development plan since 2015. We outperform our competition, reach more than 31 million uniques every month across desktop and mobile devices at the moment, and for the first time we are also the number one news portal in the age group under 49 years. When we moved the editorial team to our newsroom in Berlin and hired a new leadership team, we wanted to constantly improve the content offering and carefully broaden the user base of the portal. With a new finance section, the local to online portals for meanwhile 28 cities, and the health section kicking off, the positive journey is definitely not over yet. Our third-party sales acquired new mandates like What and Build, Health and Pharma, or Maya Dumont and Holiday Check, which will benefit from the tourism revival at the end of the pandemic and the beginning summer season. And we see more and more new business traction for our dialogue marketing business, coming from our key account structures for out-of-home and digital media. We just signed clients from touristic, insurance, and medical branches that will help keeping the growth pace you have seen already in Q1 for Dialog Media. Back to our total group performance. What trends do we see for the second quarter based on the Q1 achievement? Out-of-home will be, as you've already seen on the previous slide, between 40% to 50% above last year's Q2. Local business growing around 20% and national business fueled by constantly increasing campaign volumes week over week. The trend for digital and dialogue media looks like 35 to 40% growth for Q2 as we are running against softer comps. Ranger marketing couldn't operate for half of last year's Q2 and also our online business had at least some smaller challenges in the peak of the first COVID wave last year. So the relative performance is excellent And the absolute revenue development will be the consequent prosecution of what we have seen in Q1. Our clients invest in premium digital media solutions and increase their direct and dialogue media investments. Azam and Statista, DAS and eCommerce are running against tougher comps, but we expect another quarter with around or beyond 30% growth and overall a similar dynamics as in Q1. And Udo will talk in detail about Azam later in our presentation. And just to round up our soft optimism for the coming months for our core out-of-home business, we have integrated the latest advertising market forecast for out-of-home media from Nielsen. They expect continuously growing momentum quarter by quarter for the rest of the year and see both Q3 and Q4 above 2019 levels and especially Q4 with catch-up effects. Let me hand over to Christian Beyer, who will guide you through the financial details and the results of the first quarter 2021.

Thank you, Christian, and hello to everyone. Before we get into the details of the Q1 2021 figures, let's note again that we are comparing two quarters from different economic environments here. Q1 2020, before corona with basically no negative effects, versus Q1 2021, a quarter with three months of lockdown. Taking this into account, Q1 marked a solid start into the year. Revenues were down only by 15% on absolute terms from €368 to €312 million. Organic growth developed accordingly. As in the previous quarters, we continued to look at all cost positions with focus on the semi-flexible cost structure of out-of-home. This again included deploying the instrument of short-time work and renegotiating rents with landlords. Despite these efforts, adjusted EBITDA declined overproportionately compared to sales by 37% from 117 to 73 million euros. This development was driven primarily by the significant decline of our highly profitable digital out-of-home business, mainly public video, due to the lockdown effects caused by the corona pandemic. Exceptional items are minus 2.4 million euros compared to the minus 4.7 million euros in Q1 2020. This contains €1.3 million for incentive schemes for executives and €1 million for a broad variety of different smaller topics. Depreciation and amortization, including mainly the depreciation effects from IFRS 16, was €-75 million, some €6 million below the level of Q1 2020 due to declining PPA depreciation. With €-7 million, the financial result is just €1 million higher compared to Q1 2020 mainly because of IFRS 16 effects. Tax result was positive with €3 million compared to a tax expense of €5 million in Q1 2020 due to the negative profits from the pandemic. Thanks to our diversified business portfolio and our stringent cost management, we were able to meet the challenges of the quarter with a three-month lockdown and still achieve a positive adjusted net income of €1 million. Besides the traditionally weaker cash flow in the first quarter of the year, the cash flow development of Q1 2021 must be seen in light of the lockdown. All in all, free cash flow adjusted for Q1 2021 was down versus prior year from minus 4 to minus 34 million euros. The main drive for this development, of course, was the decline in earnings, which was partly mitigated by a comparably lower capex of 14 million euros in Q1 2021 compared versus 27 million euro in the prior year period. All other cash flow items, such as tax or changes in working capital, are basically on prior year's level. Please keep in mind that our cash flow development is, as usual, more back-loaded, and H2 is the crucial period for our cash flow generation. Our bank leverage ratio increased to 2.96 due to the negative effects from COVID-19. As the calculation of the leverage ratio includes the average of the last 12 months, The leverage ratio will be reduced again in the upcoming quarter as the weak Q2 2020 will be eliminated by a stronger Q2 2021. In our last presentation, we already shared with you our initial ideas for a new segmentation. The new structure should reflect the dynamics, changes, and developments of our business, especially since the introduction of Artifone Plus. Q1 2021 is now the first quarter that we report in the new segment structure. Let me briefly reiterate the changes. Out-of-home and public video are combined in one segment. This should make things easier to compare our core business with other pure-play out-of-home companies. Furthermore, the plus businesses with a focus on advertising, marketing, and sales services are grouped in digital and dialogue media. Finally, other statistics from the third segment, data as a service and e-commerce. With regrouping the segments, it is our ambition to maximize transparency and to unveil the potential of Früher and the Art of Home Plus strategy. Let us now have a closer look at the segments. The new Art of Home Media segment faced quite some challenges as the lockdown had a massive impact on the business. Due to changed commuting habits in the pandemic, we significantly reduced public transportation and consequently significantly lower audience, and with that lower number of contacts, Digital out-of-home faced a decline of 56% in sales, which was also reflected in lower adjusted EBITDA and adjusted EBITDA margins. Revenue declined from €180 million in Q1 2020 to €98 million in the reporting period and adjusted EBITDA fell to €36 million. Due to our rigid cost management, we were able to stabilize our gross margin and achieved an EBITDA margin of 37% despite the lockdown. As mentioned, Several times before, our out-of-home flat strategy is well balanced. This is particularly evident and in difficult times. Our new digital and dialogue media segment performed well in the challenging business environment caused by the pandemic. Revenues increased by around 4% from €154 million to €161 million in Q1 2021. Our online advertising and content publishing performed slightly below the strong pre-COVID period of Q1 2020. In contrast, our call centers and door-to-door business continued to grow strongly. Adjusted avatar grew from 37 to 38 million euros in Q1 2021, and adjusted avatar margin remains stable, above 23%. Asam and Statista continued their success story in the first quarter of 2021, exceeding our high expectations. In total, segment sales increased by 35% from 42 to 56 million euros. With organic sales growth of 31%, statistics once again significantly accelerated growth compared to the average of previous years. The same applies to Asam, where sales growth of 41% is well above pre-corona levels, with growth of around 80% e-commerce segment in particular contributed to Asam's success. Despite increasing investments and accelerated growth and the expansion of our international business, we were able to improve the margin from 9% to 12%. Adjusted EBITDA for the segment developed positively and increased from 4 to 7 million euros. Now, let's go even one level deeper to product groups, and let me give you an overview of which products we have clustered and which product groups we are reporting on. In the segment out-of-home media, we have a total of three product groups. First, classic out-of-home. Here, we have clustered all forms of traditional advertising, such as city light posters, bus shelters, etc. This area accounts for approximately 72% of segment sales. Second, digital out-of-home, which is made up of all digital inventory. In addition to public video, this also includes the entire digital roadside portfolio. This product group represents approximately 18% of segment sales. Third, out-of-home services. This product group includes all other Artifrom related products and services, such as management of our displays, but also printing of posters and giant posters. With around 10%, this is the smallest product group in terms of sales. In our new digital and dialogue media segment, we've split sales into two product groups. First, with a share of around 53% of sales, the digital product group, in which we have combined our content publishing activities, including our flagship portal to online, and our online advertising activities on third-party websites. Second, the dialogue product group, where we bundle our call centers and our door-to-door business ranges. This makes up some 47%. Finally, our data as a service and e-commerce segment contains statistics and other. This breakout is intended to ensure greater transparency and an easier accessibility of the value we see in these potential unicorns. As commented on The previous slide both performed very strongly in Q1 2021. With 59% of segment sales, ASAM forms the larger part of the segment. Accordingly, Statista or Data as a Service Business is 41% of segment sales. Let us now come to another important topic for us, ESG. Since our last update, we've continued to push this important issue forward. The central point in the last weeks was to determine our CO2 footprint. Together with the renowned agency Climate Partner, we've initiated a group-wide project to determine where we stand in terms of CO2 emissions. First, preliminary data shows that we are within the typical range for our industry. In parallel, we have been working on several topics to reduce our carbon footprint quickly and sustainably. For example, we have started to switch electricity procurement to green energy where possible. Another step towards reducing our emissions is the gradual conversion of our company car fleet to hybrid and e-vehicles. In addition, we successfully participated for the first time in an environmental rating, GAIA. We were also active on social matters. Many of our female colleagues actively participated in International Women's Day under the hashtag Choose to Challenge. In this way, we were able to set a sign to challenge gender bias and to promote equality. On the G, governance side, cybersecurity is a top priority. We pushed this topic and conducted cybersecurity checks in all business areas. We are pleased to see that we achieved an overall satisfactory security level, but we also identified some improvement areas, which are now being tackled by the respective business units. In addition, we have launched a comprehensive cybersecurity program to further mitigate risk. The focus of this program is to install a group-wide cybersecurity organization. This includes central governance, standardized asset and risk management, structured user management, and professional incident response management. To implement this program successfully, we are working together with cybersecurity experts at USD. Let me now hand over to Hugo, who will give you an update on ASAM.

Thank you, Christian. After updating you in the past quarter regularly about Statista and its successful and sustainable developments, we would like to shed light on ASAM, another upcoming unicorn in our portfolio. Since the acquisition of ASAM in 2016, the team around Markus ASAM has transformed ASAM successfully in a high-performance German beauty brand. In today's presentation, I would like to focus on ASAM's key investment highlights, such as ASAM is one of the fastest-growing European beauty brands. ASAM's organic growth in Q1 was above 40%. ASAM is targeting 500 million euro turnover by 2026. ASAM is highly profitable in developed markets, currently GSA, with margins around 20%. ASAM is kicking off its international business rollout in Q2, Q3 2021, targeting up to 50% international sales in 2025. ASAM is the first mover in the new and disruptive megatrend live shopping video commerce in Europe. ASAM is currently launching a new style live video brand platform. ASAM products are based on best in class and proprietary IP active delivery technologies. Nature meets science in ASAM high performance product portfolio. ASAM is constantly improving its advanced AI, and data-driven sales and marketing strategy. ASAM stands for Proprietary Active Skin Delivery Technologies for the Most Powerful and Active Ingredients. This is a result of ASAM's true belief and conviction that there are in almost every plant an effective ingredient, the nucleus for ASAM's intense R&D activities. This ensures a continuous development of performance-focused innovations in all beauty categories, such as anti-aging care with high-dose active ingredients. Our full vertical integrated setup in our own Germany-based facilities and laboratories ensures superior product quality and speed of innovation. As a result of our dedication towards quality, performance, and delivery technologies, we are the number one digital beauty platform with own brands in Germany, Switzerland, and Austria, GSA. The next important step to bring us to the next level will be the rollout of our proven concepts into international markets. The success factor, therefore, is our new and unique video brand platform, which is perfectly scalable and an enabler for global rollout. Science meets nature is not just a phrase at ASAM, but rather true conviction. This is reflected in extensive in-house R&D for efficient natural ingredients, such as rejuvenating grape extracts like Resveratrol. We combine such powerful actives with patented delivery technologies, which enable deep penetration for maximum effectiveness. Our broad portfolio, from innovative make-up mousses to instant skin-perfecting formulas, have international bestseller formats. In addition to our intensive R&D activities on the product side, the latest technologies, such as artificial intelligence in the area of customer acquisition and campaigning, play a decisive role for us. Based on our broad knowledge of our customers, we can use these innovative analysis tools to deliver interactive, customer-specific and, above all, exciting live beauty content for the best experience and maximum customer performance. This is supported by a full integration of all relevant touchpoints to maximize our customer lifetime value. We have created a one-stop shop beauty platform which addresses all beauty categories with a unique customer journey. A key success factor for the future is our newly developed live video commerce beauty platform which disrupts existing online shopping concepts. The platform integrates video with customized inbound channels, live stream formats and brand experience videos to the fullest extent and forms an important growth accelerator. This leverages our 20 years live shopping experience into a dedicated live streaming e-commerce strategy and brings it to the next level. Already today, we achieve up to €50,000 turnover per hour with our pilot shows which proves the strong turnover potential of this new marketing format. In order to have more flexibility and to produce constantly more shows in the future, We invested in our own streaming studio in Munich, which went live this month. In the past few years, together with the team around Markus Asam, we have built up a German beauty brand where fast growth and profitability go hand in hand. With our disruptive live streaming video platform and our highly scalable e-commerce concept, we are ready to ignite the next stage and significantly accelerate our growth across all channels and significantly increase our international footprint. We are planning to achieve 500 million Euro revenue already for 2026, fueled by significant growth in live and online shopping in the GSA region as well as in international markets. As mentioned before, we will lever our 20 years experience in live shopping into ASAM's new live video brand platform. Amazon is clearly the first mover in European live shopping, the next big thing in the e-commerce arena. The combination of our international rollout plus the push into live shopping makes us confident that we can continue and accelerate our profitable growth. We expect an average growth of 27% over the period 2017 to 2026. Our fast-growing and highly profitable business in our German-speaking home markets forms a solid foundation for the future growth of the whole company. Internationalization will be the second key growth driver for AASA. With the kick-off of our international rollout, sales growth in the non-German speaking areas are going to accelerate and the share of our international business will reach around 50% already in 2025. Of course, investing into accelerated growth, new technologies, and streaming platforms also costs money. Therefore, our profitability will decline temporarily and then return to our target margin of 20% very quickly after we have established a platform for sustainable and profitable growth out in our new international markets. Let me now talk briefly on our business outlook for the second quarter and our expectations for the full year 2021. We have given you already a quite detailed outlook for the second quarter by segment, and for the group, we expect our revenue 35 to 40% above prior year and EBITDA growing beyond 60%. Furthermore, we foresee a significant acceleration of out-of-home business towards the end of Q2. But it's still challenging to come up with a detailed guidance for the full year as there is still no clarity when the current lockdown is really going to end. There is a potential risk that mutations could cause new problems at the same time. Vaccine works and the planned timings in Germany might also accelerate. So we expect our business in 2021 on 2019 level minus lockdown effects plus catching up in the quarters three and four. As we expect a lot of dynamics and also more clarity over the next four to six weeks, we will give you a trading update in the second half of June to share more information on Q2 and Q3 that might help quantifying lockdown effects as well as the business dynamics going forward. And as already shown in the second half of 2020, we do not expect any medium and long-term structural changes in our revenue and profitability profile. If there are any, they are rather positive. Based on the development during the pandemic and our international long-term efficiency target, we also decided to accelerate our tech and IT development projects and to broaden our leadership team. With Zambia, we take over the Chief Operating Officer role from June 1st onwards to bring even more focus on the optimization of our tech infrastructure and ERP systems and therefore lay the foundation for the optimized monetization of our growing DOOH infrastructure. There are currently also increasing synergy potentials across the business segment where tech plays a key role. In addition, Henning Giesecke will join our group on June 1st as our CFO and focus on our core financial teams as well as cost management. Having worked for many years for the Metro Group, being responsible for business development, controlling and investor relations, and was CFO and co-CEO of Real Holding, retail business with 6 billion revenue. We will make the official announcement later today and are happy to have an even stronger team to execute our long-term growth targets beyond the pandemic. Our financial calendar for the upcoming months. We have planned a trading update on Q2 and Q3 in the second half of June. As many things are in motion at the moment, end of the lockdown, decreasing incidence rates, increasing availability of vaccines, and rising vaccination rates, and thus many topics affect public life, but especially the economic environment. we would like to share with you on June 26th a trading update on the current development of Q2 so far and our expectations for the third quarter and second half of the year. Our half-year financial report will then be published August 17th. Q3 results November 10th. Our AGM is scheduled for September 3rd. Thank you, everyone. We are now happy to take your questions.

Thank you. Then we will now begin the question and answer session. If you have a question for our speakers, please dial 0 and 1 on your telephone keypad. Now turn to the queue. Once your name has been announced, you can ask a question. If you find your question is answered before it is your turn to speak, you can dial 0 and 2 to call through a question. If you're using speaker equipment today, please flip the handset before making your selection. One moment, please, for the first question. The first question we've received is from Annick Maas of . The line is now open. Please go ahead.

Good morning. So, my first question is can you just give us a bit more detail around what lockdown assumptions you have for your out-of-home guidance in Q2? The second one is, you say on slide one or two that the rent adjustments are not fully reflected yet. So, can you just maybe give us an update on how these conversations are going and what the new type of rent might be looking like? Then, Rosilin has suggested that it won't sell Flaconi. I know on the other model it's slightly different, but it's the same space. So, what are your thoughts on the back of that news? And then if you could tell us just how many digital roadside screens you put out in Q1, that would be great. Thank you.

Hi, Anouk, Ali. Thanks for your questions. Let's start with the lockdown assumptions. I think the kind of revenue, yeah, I don't know if it's a guidance, but the kind of current trend that we've shown is based on the assumption that At least until mid of June, lockdown restrictions are going back significantly. I think we've seen the first careful signs already in two or three states in Germany. So I think that sounds to be reasonable. Also seeing at the current development of infection rates. I mean, if the total lockdown ends a week earlier or later, it probably won't move the needle based on the lead times that we have for our home medium. But I think right at the moment, it's reasonable to assume that at least until mid of June, the whole harder lockdown is over. Rent adjustments, it's an ongoing process. I mean, we've kicked it off more than 12 months ago. In the first wave, we then finalized most of the deals with municipalities and also private landlords or companies towards the end of last year. So we then immediately started, especially I think last week of January, first week of February again, when it became obvious that the lockdown might last a little bit longer. So I would say in 50% of the negotiations, we have some kind of indication of what seems to be realistic. In 50%, we are in the middle of negotiating it. And I think both aspects are also influenced by the fact how quickly the business will recover. Because at the end of the day, we do not only talk about Q1, maybe a little bit about Q2 as well. Then the question is, how big are the catch-up effects and what are the total revenues for the year? So on the one hand, we want to be fair with partners and have more clarity and visibility about the full year. On the other hand, negotiations need a little bit of time. But of course, the rent adjustments that we mentioned mean there will be less rent than what we have currently in the Q1 P&L. on the Flaconi topic?

On the Flaconi topic, I think this is not influencing our thoughts here on ASAM. I think it's also important to realize that Flaconi and ASAM are totally different assets. I mean, Flaconi is a retailer, a relatively small e-commerce retailer, which was mainly pushed by TV advertising from ProSiebenSat1. So without these, let's say, several prices on TV commercials and ProSiebenSat1, we have a much more difficult situation. The margins are super small, and Azam is zero retail. Azam is only on products. It's a brand business and not a retailer. And we also don't sell through Flaconi, for example. We only accept retail and stationary sales. ASAM is, especially in online and the new video commerce arena, is only selling on its own platform. So that's why ASAM is highly profitable. And also much easier now to... to roll out international. It's almost impossible for a German, mostly German-based retailer like Flaconi to go international rollout because it's totally crowded out there. There's a lot of competition in other markets and you have absolutely no USP why a German retailer should be successful in America, for example. You have really no no upside on the long run. So Adam is now entering a very exciting phase because on one hand, we started to kick off our internationalization of the business. And second, live shopping will be clearly something which is pushing Adam's turnover and valuation a lot. Live shopping is the next big thing in e-commerce coming mainly now from Asia. But live shopping is nothing else than good old TV shopping, where Azam, based on streaming, new technology, same concept. And Markus Azam, I think he himself sold for, I don't know, two or three billion euros products in his life in the TV. So Markus Azam knows better than anybody else how live shopping is working. It doesn't matter if it's TV-based or streaming-based. And I think this is also, by the way, a reason why we decided to focus on value crystallization the second half of next year, because we are pretty sure that we're going to see 200 million turnover next year. And that's also, by today, the first time we publish now the numbers which we expect for the next four or five years. So this is actually more or less now the kickoff of that, but we already announced H2 next year. It's clearly the timing for value crystallization, either a trade sale or an IPO.

Okay, thank you. 104 roadside screens, that's what we've built up in one.

Okay, thank you very much.

And that, by the way, is the reason also why we go full transparency here. On Shatista, by the way, like on Azam. This is, by the way, unchanged in case other questions are coming up. So Azam targeting second half next year and Shatista most likely one year later. And, by the way, we just got approached like four weeks ago. One of the big global... PE funds offered us a billion euros for Statista, but we said no. It's too early for both assets. We still stick to our communicated strategy, 200 million turnover, and it's exactly the starting point for our value crystallization strategy on both assets.

Thanks. Yes, thank you.

Good morning, everyone. I just have a very specific question, please. In the digital and dialogue media division, I was just trying to understand a little bit better why the digital sales were so weak in Q1, down 10%. If you could maybe explain that and how that was potentially linked to lockdown and what you're what your expectations there are for the coming quarters. Thank you.

Well, I think that we've had a disposal last year, I think at the end of Q1 with Q1 networks. That is probably the biggest chunk of the delta. Okay. And in parallel, I think January and February were relatively good. There were a couple of Easter campaigns. I think in general it canceled because it just happened when the lockdown was prolonged and the third wave came up. So I think it was not dramatic. That was maybe two or three points. But I think in general the momentum was okay given the overall situation. I think the disposal explains most of the delta.

Okay, so the underlying on the trading and so forth is fine.

Exactly, yeah.

Okay, thank you.

Thank you. Then we'll go to the next question. It's from . The line is now open. Please go ahead.

Yes. Good morning. Thank you for taking my question. Just I didn't hear the numbers on or I just want to double check. You said you were approached four weeks ago by a global PE fund and they offered a billion euro for Statista. Is that what you said? That's my first question. The second one is, thank you very much for all those details on that. That was very helpful. Just on Statista, based on the current run rate, what kind of growth rate do you expect this year? That's my second question. And then my last question is, can we have a split of the new out-of-home segment between Germany and international, please?

Yeah. Thank you. To go more in detail with Statista, the offer was to sell around 50% on a valuation of 1 billion euros. And then I asked the guys, why should we do that? And then they said, then we sell it for 2 billion in three years together. And I said, but that's exactly the point. We can also sell it for 2 billion in three years alone. So we... Statista doesn't need any cash. Statista management knows exactly what to do. The business is growing by 30% in the first quarter. It makes absolutely no sense because the argumentation was, yeah, but it gives you value crystallization now. But I think we would destroy value for our shareholders. So that's why. I mean, this was not the first offer because normally we actually don't even take the calls. But this was just the latest development. It was one of the biggest, whatever, five global funds, which has a clear proven track record. But nobody can, from our point of view, we don't believe that anybody can help us here in developing it faster as it's anyway doing. So that's why we declined the offer. But this... This was exactly the approach here. But again, this was not the first one, so we see that every, let's say, four weeks or something like that, something is calling me, going to have to talk to a statistician, et cetera, or to ask them. So now, because now that we have more visibility on the stuff, it's clear that, and I have to say, it was a bit funny for me now to give information about the beauty business, because we are an auto business, and it's... But clearly the time of ASAM is limited in our portfolio. The expected growth is around 30%, I would say. Q1 was better than 40%. That's a very, very strong start. I have to say, Markus and his team are doing a great job. And what I already said before, we are quite excited now with live shopping. because the ASAM team believes that live shopping is the next big thing in e-commerce. And clearly, Markus is better prepared than anybody else to take advantage from that. So we'll be launching new studios in Munich in this month. By the way, if you're interested to see that, you're more than welcome to have a look at what the guys are doing there. And it's really interesting. to listen also to his ideas about what is the future in beauty e-commerce around developing a live video brand platform to create a completely new experience for the customers. So around 30%, maybe a bit better. We are fully on track also in the second quarter. So business is running really good in in extremely good initiatives as well as in other.

And on the non-German out-of-home business, so concrete number in Q1, we've made 5.8 million revenue outside of Germany. That's UK and Benelux blow-up, and the Polish out-of-home business, I think it's a little bit less than 6% of the segment. performing a little bit better than the German out-of-home business. But looking at the full year as well, I think the non-out-of-home business, sorry, the non-German out-of-home business will be plus minus a little bit around 6% of the segment. Based on the current forecast, it will pretty much perform in line with the German business. So that's why maybe that's also one of your the underlying questions, that's why we felt like it's too small and not crucial to disclose it as a dedicated sub-segment because the development of the German business analog versus digital in combination with how do we package the out-of-home business with incremental services on top is the more relevant sub-segment structure. But we can disclose the information always any time. I think it will be quite a robust number over the course of

Okay, thank you. That was great. Just my question, because I think you gave us what you were expecting for Assam for the full year. My question was for Statista for the full year. So are you saying Statista grows around 30% for 2021?

Yeah, I think we'll get there. Somewhere between 25 to 30 at the moment. Yeah, being at the beginning of the year, but looking at the dynamics we've seen, 30 is probably realistic.

Okay, very good. Thank you very much

You're welcome. And by the way, I mean, the one billion was ten times turnover. In today's environment, you never know, it might change next year. Ten times turnover is also not a very demanding valuation for a business like Statista. If you look on the American capital market right now for comparable businesses valuation, It's 30, 40, 50% higher than even that offer was right now. And Statista is still without any competitor. I think this is very important to see. There is no competition for Statista. So Statista's success is only based on our own execution quality. And I think this is something what is quite rare in digital in the digital arena today if you look on DAS businesses or if you look on comparable DAS businesses.

Okay, very good. Thank you.

You're welcome.

Thank you. The next question is from Clara Kaminiček of Stifel. The line is now open. Please go ahead.

Yeah, thank you for taking my question. You gave some very interesting insights into ASIM. Could you, as far as possible, give us some more details on Statista's margin outlook as well? In the past, you said that Statista stands at around 20% EBITDA margins and could potentially reach 30% at some point. Looking at your numbers, it should have been around break-even in Q1. When do you see profitability here, and where does it stand now, and where would you expect it to go structurally?

Well, I think at the moment... We focus completely on top-line growth and diversifying into more and more markets, investing and deepening the product offering, working on key accounts. I think we already have reference points from the past, from mature and fully developed markets like Germany. That's where the EBITDA margin was or is already between 30 and 35 percent. So that means when you We have a completely rolled out robust product in combination with a very well-developed sales infrastructure in a market. And I think ultimately, if you get to that stage globally, that's a realistic, I think, ultimate margin. At the moment, we are completely in growth mode and also try to make sure that we do the right things that make sense for statistical development mid to long term. And quarterly margin can even differ by 10 points or so. It's just the necessary result from or the logical result from what we think is the right thing to do on the investment side. But I think many markets were in the year one or two with a real rollout. And in countries like Germany or Austria or Switzerland, we talk about seven, eight years development. And there you see over time you get to that margin profile.

Okay, very clear. Thank you.

Thank you. At the moment, there are no further questions. So as a reminder, to ask a question, you have to press 0 and 1 on your telephone keypad. And the next question we've received is from Patrick Wellington of Modern Family. The line is now open, please go ahead.

Yes, morning everybody. A couple of questions. Firstly, on the guidance, on slide 8, most of the businesses I think being shown there are growing at above the 35 to 40% rate for the group. So how do we How do we square that? Are we basically looking at some very conservative guidance there? We've got 40 to 50% growth in outdoor media. We've got 35 to 40 in digital and dialogue media. We've got 30% in digital commerce. And yet the overall growth is 135 to 140. Looks a little bit conservative, particularly as you're expecting that acceleration of growth in outdoor media. That's the first question. Second question, Udo, very good to hear you talk about beauty products. I'm sure your skin is looking particularly good at the moment. You did previously talk about a target valuation of 200 million euros in 2023 for Assam Beauty. Given that you've been talking about the potential valuation of Statista, what do you think the potential valuation for Assam should be, given that you're ahead of schedule? on the sales growth.

Thank you Patrick, that answers a lot of questions indeed. Indeed, my skin looks amazing. I was going to send you a picture later on. I was talking about 200 million turnover, maybe there was a misunderstanding not valuation. I'm not the one who should decide what is the business really, what is the right valuation that other people have to do. That's also the valuation which I just cited from the third-party valuation, not from our side. We have a clear idea of what we think, what the businesses are rightly valued, but we prefer to keep that for our own. I mean, if you look on... But I have to admit, I also try to understand the last week what could be potential valuation. So if you look on comparable businesses, then clearly growth is a key matter here. So if you look at businesses in this area growing above 20%, then a bit surprisingly you also talk about a ton of our multiples they are I say beyond six or seven or eight times even higher and so I think Azam right now has a very effective combination from growing on you couldn't find anything faster than Azam but you never know maybe there's a smaller company who grows faster but if you if you look at the companies who could be identified but to investment banks, which we're talking to, Azzam is a fast-growing asset in the arena right now, and it's still profitable. So we believe it's a... We have something in mind, but I hope you can understand that we don't want to talk about it, because if you say something where somebody's not agreeing, people will say, oh, Schwoz pushing valuation and this and that, so we don't want to do that, I think. Other people should put the price target on Asam. We don't want to do that.

Okay. I've got $250 million in, so that's obviously way too low.

I mean, this is a misunderstanding, I think. Let's give it like this. I can give you one quote from an analyst from last week. He said that he sees right now $750 for Asam based on turnover and EBITDA multiples. This was a quote from last week. What we are saying in the presentation, we were saying an upcoming unicorn that is difficult to say. I mean, if you look on the IPO from, what's the name here, the German? For me, totally nuts. Two and a half billion, or how much it was, I think 14. 10 times turnover for retail business and almost 100 times EBITDA. This was totally exaggerated, clearly. But in today's world, it's quite good. I think what we expect that the next 12 months we see really that quality will remain to have high valuations, but there's obviously a lot of lower quality assets in the market. And from my point of view, I think all this SPAC hype is actually pushing companies and the capital markets, they should maybe stay private. But we believe you're going to see a big shakeup in the next 12 months between low- and high-quality assets. And we had an intensive discussion also internally if you should hurry up with AASA, for example, to capitalize this opportunity. in case that this was really materialized, but at the end we decided, no, we stick 100% to our strategy, which we communicated from the beginning. The moment we see 200 million turnover, it's exactly the moment we're going to start that, and this is still H2 of second year. But... turnover multiples right now in this industry for business growing in this speed is clearly above five, six times. So that's what we're seeing right now.

Thank you. Patrick, and then on the question of our guidance for Q2 that we stated on page eight, how we look at it is basically segment by segment. And the Index figures we stated there, that's really at the moment our best guess, looking at the current order intake, the trends that we see. We talked about our assumptions about when the lockdown is coming to an end. So that's, you know, our view at the moment. And then just kind of like doing the math brings us more or less to what we stated on the group level, probably more on the upper end. The reason for that is simply that obviously Q2 2020 was a bit of a The quarter actually out of home sales in Q2 was only 40% of our entire revenue base in 2020. And then doing the weighting brings us roughly to this 135, 140, probably, you know, mathematically just more the upper end of the corridor.

Okay. That's great. Thank you.

Thank you. Better to add one thing. It's difficult for us to say something. Maybe if you look at the last 20 quarters, we really like to outperform what we are forecasting, and therefore it's necessary to have a very stable environment, which is here in valuation right now difficult. I mean, if you really look on a global scale on valuations right now, You can even see 15 times turnover for beauty businesses without any profit. So for me, it's totally not. And I don't believe this is sustainable. So that's why it's really not easy to predict 100% what will be the outcome next year. So that's why I think if you talk about something north of six times turnover from this perspective, we would be still on the safe side.

That's clear. Thank you.

Thank you. If there are no further questions, I would like to talk to you.

Thank you very much for your time. As we said, we'll do a trading update second half of June. Hopefully then we have more insights and can give you more details about the rest of the year. Thanks for your time and see you soon. Take care. Bye-bye.

Ladies and gentlemen, thank you for your attendance. This call has been concluded. You may disconnect.