1. XING – #1 Professional
Social Network In German
Speaking Europe
Investor Presentation, May/June 2013
2. Disclaimer
2
This presentation was produced in May 2013 by XING AG (the "Company") solely for use as an information source for potential business partners and is strictly
confidential. It has been made available to you solely for your own information and may not be copied, distributed or otherwise made available to any other person
by any recipient. This presentation is not an offer for sale of securities in the United States. The distribution of this presentation to you does not constitute an offer
or invitation to subscribe for, or purchase, any shares of the XING AG and neither this presentation nor anything contained herein shall form the basis of, or be
relied on in connection with, any offer or commitment whatsoever.
The facts and information contained herein are as up-to-date as is reasonably possible and are subject to revision in the future. Neither the Company nor any of its
subsidiaries, any directors, officers, employees, advisors nor any other person makes any representation or warranty, express or implied as to, and no reliance
should be placed on, the accuracy or completeness of the information contained in this presentation. Neither the Company nor any of its subsidiaries, any directors,
officers, employees, advisors or any other person shall have any liability whatsoever for any loss arising, directly or indirectly, from any use of this presentation. The
same applies to information contained in other material made available at the presentation.
While all reasonable care has been taken to ensure the facts stated herein are accurate and that the opinions contained herein are fair and reasonable, this
document is selective in nature and is intended to provide an introduction to, and overview of, the business of the Company. Where any information and statistics
are quoted from any external source, such information or statistics should not be interpreted as having been adopted or endorsed by the Company as being
accurate.
This presentation contains forward-looking statements relating to the business, financial performance and results of the Company and/or the industry in which the
Company operates. These statements are generally identified by words such as "believes," "expects," "predicts," "intends," "projects," "plans," "estimates," "aims,"
"foresees," "anticipates," "targets," and similar expressions. The forward-looking statements, including but not limited to assumptions, opinions and views of the
Company or information from third party sources, contained in this presentation are based on current plans, estimates, assumptions and projections and involve
uncertainties and risks. Various factors could cause actual future results, performance or events to differ materially from those described in these statements. The
Company does not represent or guarantee that the assumptions underlying such forward-looking statements are free from errors nor do they accept any
responsibility for the future accuracy of the opinions expressed in this presentation. No obligation is assumed to update any forward-looking statements.
This presentation speaks as of March 2013. Neither the delivery of this presentation nor any further discussions of the Company with any of the recipients shall,
under any circumstances, create any implication that there has been no change in the affairs of the Company since such date.
IMPORTANT NOTICE
Pro-forma results
Results contained in this presentation are partly based on unaudited pro-forma financial results that the Company derived from its preliminary and past financial
statements for the indicated periods in order to make these periods comparable and show non-recurring costs.
Cautionary note regarding preliminary results and pro-forma financial results
This presentation contains preliminary results and pro-forma results. The preliminary results may change during their final review. While the Company believes that
its pro-forma financial results are reflective of its recurrent trends and the on-going status of its business, there can be no assurance that its pro-forma results will
accurately reflect these trends and status and therefore, its investors are urged not to rely solely upon the pro-forma results when making their investing decision
and the pro-forma results should always be reviewed together with its actual financial results.
3. Executive Summary
3
Large growth potential
Clear strategy to double revenues
#1 professional social network in D-A-CH
High profitability and strong cash-generation
4. … in members
… in social recruiting
… in activity
… due to strong local ties
Leading professional social network in D-A-CH…
4
Page Views Distribution
of professional networks 20122
80%
19%
1%
> 250 local Ambassadors
> 120,000 offline events p.a.
XING belongs to Germany’s DNAWhich social media sites are
best for finding top talent1
Member base and net growth
2011 2012
+816k
5.28m
6.09m
42
8
3 3 1
XING Facebook Twitter LinkedIn Other
Source:
1 Forsa survey among 201 HR decision makers in Germany, September 2012
2 Comscore Metrics 10/2012
Local customer service
Largest local sales force
Specialized for local needs
#1
5. Members use XING for…
5
Digital identity management
Networking and
knowledge transfer
>6m business
professionals in D-A-CH
Jobs/career opportunities
Event participation
6. Corporates use XING for…
6
e-Recruiting
active sourcing
(Talent Manager)
Passive sourcing
(Job ads and
employer branding)
Organize events
Increase reach
of events
Advertising
Identify potential
customers and business
partners
Ad
example
>6m business
professionals in D-A-CH
7. XING has multiple ways of monetization
7
Premium Club Events
e-Recruiting
Paid
memberships
Premium membership:
• 3m @ €7.95 p.m.
• 12m @ €6.95 p.m.
• Total of 810k payers
(D-A-CH: 786k)
13% payer ratio
Advertising
• CPM model
13m+ members worldwide with 6.3m+ members in D-A-CH
Passive recruiting
• Fixed price job ads: €395 – €595
• Click price job ads: €0.79 p.c.
Active recruiting
• XING Talent Manager: €249/license p.m.
Employer branding
Company Profiles
• @ €395 - €1,095 p.m.
Commission
to XING
• 5.9% of ticket price
• €0.99 per ticket sold
• AdCreator
(Event Lead Gen):
CPM Model
Existing monetization models easily transferrable to mobile
8. 4th largest economy worldwide1
• 100m inhabitants
• 77m internet users
• $4.3 trillion GDP
(35% of EU)1
Significant potential to further drive member and revenue growth
8
1 Source: International Monetary Fund
2 Source: XING estimates
3 Source: Convene’s annual meetings market survey & XING estimates
>20m white collar
professionals2
>€1.3bn recruiting industry2
~€500m events ticketing
and fulfillment market3
Particular challenges
• Aging population
• Shortage of skilled workforce
• War for talent
D-A-CH
9. Key strategic initiatives
9
Our strategy to double revenues
Mantra and
Vision
Social Network
Premium Club
e-Recruiting
Events
Socializing business
We are THE social fabric that creates and
enriches business interactions every day
Desired membership
Every single day a user knows that
his/her membership is valuable
Matching people and jobs
There is no job search without XING –
neither for recruiters nor for job-seekers
Digital mastermind of events
We are the first point of reference for organizers
and attendees of professional events
Increase relevant and
unique user value
Establish paid
business community
Establish leading active
sourcing and employer
branding platform
Build Europe’s largest
platform for conferences
and seminars
10. We are THE social
fabric that creates
and enriches busi-
ness interactions
every day
10
Executing our growth strategy:
Our Social Networking platform
Socializing
business
Addressable market: ~20m users
• Strong network effects
• Strong growth of mobile traffic
• >300m P2P connections
Our strategic initiatives to drive
growth and traffic of our network
Mantra
Vision
Members in D-A-CH
5.3
6.1 6.3
2011 2012 Q1 2013
• Push mobile
• Drive relevance for users
• Pull in members through Verticals
• Build API ecosystem
• Evolve design and usability
to become more engaging
11. 233
203
196
184
205
2011 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 March '13
11
Continuing member growth in core region
Long runway left for further growth in D-A-CH
Daily active users (DAU): Q1‘13 vs. Q1‘12: +29%
Member base & net adds
5.3
6.3m
Addressable market
in D-A-CH
~20m
12. 12
Executing our growth strategy: Premium Club
Desired
membership
Every single day
a user knows that
his/her membership
is valuable
Mantra
• Revitalize current premium
membership with additional benefits
(XING and 3rd party)
• Add new paid special memberships
• Seal new partnerships
Our strategic initiatives to
drive growth
Vision
45.1
48.8 51.3
2010 2011 2012
Premium Club revenues in €m
Addressable market:
XING makes market
• 810,000 paying members
• 13% payer ratio
• >90% renewal rate
12
13. Matching people
and jobs
There is no job
search without
XING – neither for
recruiters nor for
job-seekers
Mantra
• Claim the market and secure no. 1
position for active sourcing in D-A-CH
• Increase product offering:
New products for active recruiting
and employer branding
(kununu acquisition in January 2013)
• Build the market:
By expanding into adjacent segments
Our strategic initiatives to
drive growth
Vision
Executing our growth strategy: e-Recruiting
XING offers the largest database for active and passive job-seekers
13
7.8
13.3
16.7
2010 2011 2012
Addressable market: €1.3bn
Passive and active sourcing
Headhunting market (skilled)
Employer branding
Freelancer market
• XING is already #1 in social recruiting
• Opportunity to establish active sourcing
as most effective way to recruit
• Social context makes passive sourcing
more effective
• Large sales force with local
customer service
e-Recruiting revenues in €m
14. Access to the largest talent network
in German-speaking countries
14
Executing our growth strategy: e-Recruiting
XING Talent Manager (XTM) for active sourcing
1 Source: ICR Recruiting Report 2012, 500+ Participants
2 Regular price. Introductory offer includes discount
German companies pursuing
active sourcing1
11%
24%
18%
2010 20122011
TALENT MANAGER (€3,000 p.a. per license)2
“The long-term corporate recruiting solution”
Launched Sep
27, 2012
User licenses are distributed by company
Project folders for current vacancies
keep things organized
Transparent teamwork for
recruiting projects
>1,500
seats sold
already
15. Digital mastermind
of events
We are the first
point of reference
for organizers and
attendees of
professional events
Mantra
Our strategic initiatives
to drive growth
Vision
15
Executing our growth strategy: Events
• Integration of amiando@XING
after founders left
• Strengthen marketplace
and lead generation
• Mobile now!
• Change passive
to active sales
Events revenues in €m
Addressable market: ~€500m
• >120k events organized
• >700k event participants
• Strong local sales force
• AdCreator to promote events online
0
2.5
3.9
2010 2011 2012
16. 16
Our goal: double revenues until 2016
2015
2014
2013
EBITDA
margin
expansion
becomes
visible
Strengthen
execution
excellence and
accountability
Selective
investments
in product and
marketing/sales
Headcount
increase
significantly lower
than in previous
years
2016
Year of
transition
Growing
top line
20%+ yoy
Revenues
doubled
17. 17
Our Financials
Regular dividends
Attractive revenue growth with
further growth potential ahead
Negative invested capital
Strong cash flow generation
Strong profitability despite increased
investments in growth
18. FY 2012: Revenue growth 11%, flat EBITDA
18
One-time effects on €1.9m related to mandatory
takeover bid by Burda Digital & kununu acquisition
2012
adjusted
2011 2012
vs. 2011
2012
vs. 2011
Abs.2) Abs.3) Abs. Rel.
Total revenue1 73.3 66.2 7.1 11%
Costs (51.3) (43.9) (7.4) (17%)
EBITDA 22.0 22.2 (0.2) (1%)
Margin 30% 34% (4% pts) (4% pts)
Depreciation (8.3) (8.0) (0.3) (4%)
Financial result 0.3 0.5 (0.2) (32%)
Taxes (4.8) (5.3) 0.5 9%
Net result 9.2 9.4 (0.2) (3%)
(1) Including other operating income
(2) 2012 figures adjusted for one-time expenses related to Burda takeover bid & kununu GmbH acquisition (€1.9m) & taxes adjusted by €0.5m accordingly
(3) 2011 figures adjusted for one-time write-down of market entries for Spain & Turkey (€14.4m) & taxes adjusted by €0.3m accordingly
19. All business units profitable except “Events”
19
2012
Network
Premium Club
e-Recruiting
Events
EBITDA margin (group) 30%
Profitability by business unit
Ongoing investments in “Events” dilutes group EBITDA margin by 5-6% pts
N/A
20. FY 2012: Revenue Split
20
e-Recruiting
in €m
2011 2012
13.3
16.7
26%
Events
in €m
2011 2012
2.5
3.9
54%
2011 2012
48.8 51.3
5%
Premium Club
in €m
21. Full year operating cash flow €18.9m
21
2012 2011 2012
vs. 2011
2012
vs. 2011
Abs. Abs. Abs. Rel.
EBITDA 20.1 22.2 (2.2) (10%)
Interest/tax/ESOP (3.8) (9.1) 5.3 59%
Net working capital 2.6 0.8 1.8 224%
Operating cash flow excl. organizer cash 18.9 13.9 5.0 36%
Investment – operating (7.3) (6.5) (0.8) (12%)
Investment – acquisitions (2.5) (5.4) 3.0 55%
Financing incl. transaction of own shares 3.9 5.2 (1.3) (27%)
Free cash flow excl. dividends & organizer cash 13.0 7.2 (5.8) N/A
Capital return (20.0) 0.0 (20.0) N/A
Regular dividend (3.0) 0.0 (3.0) N/A
Free cash flow excl. organizer cash (10.0) 7.2 (17.2) N/A
Effects organizer cash 0.6 2.0 (1.4) (71%)
Free cash flow incl. organizer cash (9.4) 9.2 (18.6) N/A
Adjusted for distortions in 2011 operating cash flow is on previous years level
[2011 adjusted for tax-cash-outs for years 2006-2010 (€4.8m) = OpCF: €18.7m]
21
23. Q1’13: €19.6m revenues, €5.3m EBITDA
23
(1) Including other operating income
(2) Adjusted for one-time expenses related to Burda bid and kununu acquisition (€1.9m)
Q1’13 Q4’12 Q1’13
vs. Q4’12
Q1’12 Q1’13
vs. Q1’12
Abs Abs.2 % Abs. %
Total revenue1 19.6 19.0 3% 17.7 11%
Costs (14.3) (12.4) (15%) (12.9) (11%)
EBITDA 5.3 6.6 (19%) 4.8 11%
Margin 27% 35% (8%pts) 27% 0%pts
Depreciation (2.3) (2.3) 2% (1.8) (25%)
Financial result 0.0 0.0 19% 0.1 (70%)
Taxes (1.1) (1.4) 22% (1.1) 5%
Net result 2.0 2.9 (32%) 2.0 1%
Q1 first-time consolidation of kununu
24. Q1’2013: e-recruiting with 32% yoy growth
24
e-Recruiting
in €m
Q1'12 Q1'13
4.0
5.3
32%
Events
in €m
Q1'12 Q1'13
1.0 1.1
5%
Q1'12 Q1'13
12.4 12.8
4%
Premium Club
in €m
25. Personnel main investment area to further drive company growth
25
Personnel
in €m
in % of total revenue
Marketing
in €m
in % of total revenue
Other Expenses
in €m
in % of total revenue
Investment into product/technology
organization & sales/marketing
22 new FTEs in Q1
(inkl. 25 from kununu)
65 new FTE’s since Q1’12
Online display & social media adv.
Search engine marketing (SEM)
Offline marketing expenditure
(conferences & events,
print, sponsoring)
Affiliate marketing
External services, legal, audit &
consulting
Payment processing, server
hosting
Rent & other costs
7.3 7.6
8.8
Q1'12 Q4'12 Q1'13
41% 41%
1.9
0.6 1.2
Q1'12 Q4'12 Q1'13
10%
3%
3.8
4.2 4.4
Q1'12 Q4'12 Q1'13
21% 22%
45%
22%
6%
(38%) 16%20%
Cost development reflects first-time consolidation of kununu
29. 29
Public launch of XING projects – a marketplace for freelancers
Logical extension for
e-Recruiting business
Public launch January 28, 2013
>700,000 freelancers on XING
already (D-A-CH)
5 digit-number of projects are
being posted already
Monetization will start at the
end of Q2
Listing fee for a project will be
@195 for 30 days
30. 30
Launch of XING ipad App
Mobile XING usage now at 36% of
tota visits
iPad closes the gap between the
Laptop and the smartphone
Extending XING usage into early
morning and evening times
Focus on key functions:
Contacts
Messages
Search
Exclusive iPad feature:
“Bookmarking“ job ads and
member profiles
31. 31
Update on kununu integration
Lots of progress in the first quarter 2013
Rate your
employer
action on
CP
XING ID
on
Kununu
February March April
Kununu
on
BASICs
Kununu
compulsory
for new
business
Competitive
Advertising
on CPs
New
Ratings
tab on CP
XING Jobs
on
Kununu
Pricing for new CP customers
depending on company size and
feature set
Kununu sales force to exclusively
sell XING CPs starting Q2‘2013
32. 32
XING Talentmanager update – Significant product
improvements thanks to valuable customer feedback
XTM selling above internal
plans: >1,500 seats sold
>4,000 recommended
feature additions received
from users
Fast iteration with weekly
feature updates to XTM
Positive customer feedbacks
Old “Recruiter Membership”
will be phased out at the end
of 2014
34. XING AG IR stats
Market cap: ~€250m / €58m cash / no debt
34
Average trading volume per day (XETRA)Consensus from
10 brokers 2013e 2014e 2015e
Total revenues 81.8 91.4 94.1
EBITDA 24.0 29.3 32.1
Margin 29% 32% 34%
Depreciation (8.1) (8,1) (8,1)
EBIT 15.9 21.1 23.2
Margin 19% 23% 25%
Net income 11.1 14.6 16.7
EPS in € 2.04 2.69 3.02
DPS in € 0.71 0.82 0.87
Analyst coverage
Berenberg Bank, Commerzbank,
Close Brothers, Deutsche Bank,
Hauck & Aufhäuser, HSBC,
JP Morgan Cazenove,
MM Warburg, Montega
Shares 5,554,503
Consensus
(AnalystestimatesasofMay27,2013)
TecDax ranking end of April 2013
Market Cap. 35
Turnover 29 Numbers based on last filing – actual shareholdings can differ
Burda Digital GmbH 2,922,244 52.61%
DWS Investment 361,000 6.50%
Ennismore 293,622 5.29%
Schroders 282,421 5.08%
Ruane, Cunniff & Goldfarb 169,259 3.05%
Treasury Shares 37,832 0.68%
Other 1,487,865 26.79%
27,677
14,156
11,601
6,216
15,437
21,259
9,807
6,222
3,683
6,537 6,989 6,621
12,335
May-12 Jun-12 July 12 Aug-12 Sep-12 Oct-12 Nov-12 Dec - 12 Jan-13 Feb-13 Mar-13 Apr-13 May-13
35. XING share price development since IPO in Dec 06
as of May 27, 2013
35
+31%+13%+38%+56%
0%
50%
100%
150%
200%
250%
XING AG TecDAX SDAX DAX
36. Investor Relations
Contact details & social media channels
36
Patrick Moeller
Director Investor Relations
XING AG
Dammtorstraße 29-32
20354 Hamburg
Germany
Tel.: +49 (0)40 419 131-793
Fax.: +49 (0)40 419 131-44
(Please use this number to submit “WpHG notifications”)
Email.: patrick.moeller@xing.com
IR website: http://corporate.xing.com/english/investor-relations/
http://twitter.com/xing_ir
http://www.slideshare.net/patmoeller
http://www.youtube.com/XINGcom
http://blog.xing.com
skype:patrickmoeller?add
