Avast plc 2021 Half year results - 11 August 2021
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
Avast plc
2021 Half year results
11 August 2021Disclaimer
This presentation has been prepared and issued by, and is the sole responsibility of, Avast plc (“Avast” or the “Company”), being the current holding
company of the Avast group (the “Group”).
The information and opinions presented or contained in this presentation (including forward-looking statements) speak as of the date hereof (unless
otherwise stated) and are subject to updating, revision, verification and amendment without notice and such information may change materially.
Nothing in this presentation should be considered as a profit forecast.
This presentation includes forward-looking statements. The words "expect", "anticipate", "intends", "plan", "estimate", "aim", "forecast", "project" and
similar expressions (or their negative) identify certain of these forward-looking statements. These forward-looking statements are statements regarding
the Group’s intentions, beliefs or current expectations concerning, among other things, the Group's results of operations, financial condition, liquidity,
prospects, growth, strategies and the industry in which the Group operates. The forward-looking statements in this presentation are based on
numerous assumptions regarding the Group’s present and future business strategies and the environment in which the Group will operate in the future.
Forward-looking statements are not guarantees of future performance and involve inherent known and unknown risks, uncertainties and contingencies
because they relate to events and depend on circumstances that may or may not occur in the future and may cause the actual results, performance or
achievements of the Group to be materially different from those expressed or implied by such forward-looking statements. Many of these risks and
uncertainties relate to factors that are beyond the Group's ability to control or estimate precisely, such as future market conditions, currency
fluctuations, the behaviour of other market participants, the actions of regulators and other factors such as the Group's ability to continue to obtain
financing to meet its liquidity needs, changes in the political, social and regulatory framework in which the Group operates or in economic or
technological trends or conditions.
All forward-looking statements in this presentation are based upon information known to the Company on the date of this presentation. Accordingly, no
assurance can be given that any particular expectation will be met and readers are cautioned not to place undue reliance on forward-looking
statements, which speak only at their respective dates. Additionally, forward-looking statements regarding past trends or activities should not be taken
as a representation that such trends or activities will continue in the future. Other than in accordance with its legal or regulatory obligations (including
under the UK Listing Rules and the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority), the Company undertakes no
obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Nothing in this
presentation shall exclude any liability under applicable laws that cannot be excluded in accordance with such laws.
This presentation does not constitute or form part of any offer or invitation to purchase any securities of any person nor any offer or invitation to sell or
issue, or any solicitation of any offer to purchase or subscribe for, any such securities.
In accordance with Rule 26.1 of the City Code on Takeovers and Mergers, a copy of this presentation will be available (subject to certain restrictions
relating to persons resident in restricted jurisdictions) at https://investors.avast.com/investors/ by no later than 12 noon (London time) on the business
day following the date of publication. The content of any website referred to in this presentation is not incorporated into an does not form part of this
presentation.
2Agenda
1 H1 Highlights & Business Overview: Ondrej Vlcek, CEO
2 H1 Financial Results & 2021 Guidance: Phil Marshall, CFO
3 Q&A
31 H1 Highlights:
Ondrej Vlcek, CEO
4Key Messages
• On 10 August 2021, the Boards of NortonLifeLock, Inc. ("Norton") and Avast plc (“Avast”) reached agreement on the terms of a
recommended merger of Company with Norton, in the form of a recommended offer by Nitro Bidco Limited, a wholly owned
subsidiary of Norton, for the entire issued and to be issued ordinary share capital of Avast.
• The combination with Norton offers strategic, operational and financial benefits for Avast and its stakeholders
• H1 performance in line with the Board’s expectations, FY21 guidance for organic revenue growth and adjusted EBITDA %
maintained
• Billings expected to return to high single digit growth in H2, with H1 reflecting strong Covid-19 baseline and downward pressure
from the Group’s transition to single year subscriptions to increase customer lifetime value
• Customer retention now at 69%, having held-up through the “Covid cohort” renewal period
• Avast One on track to launch in H2, encouraging early signs but will take time to develop and evolve
• Rapidly evolving cybersecurity landscape, with a shift towards protecting consumers’ entire digital lives, including their
identities. As a result, we see increased competition from major technology players, and other incumbents who are scaling-up
and evolving their offerings into integrated solutions to meet changing customer preferences
• Addressing this evolving landscape to sustain customer engagement, will require higher levels of margin investment in R&D,
marketing and other top-of-funnel acquisition & retention initiatives over the medium term, plus targeted acquisitions in a
competitive M&A environment
5H1 Financial & Operating Highlights
• Overall good results:
• +10.4% revenue growth(1) driven by our Consumer Direct business
• Modest +0.9% billings growth against the backdrop of a strong prior year performance and transition to
single year subscriptions
• Adjusted EBITDA margin 57.3% as a result of investments being H2 weighted
• Unlevered Free Cash Flow +9.0% to $263m, with leverage now at 1x LTM EBITDA
• Consumer Direct operating KPIs tracked positively. Customers +1.5% to 16.72m from 16.47m at 2020 year-end,
supported by continued growth primarily in the target countries
• Declared 2021 interim dividend of 4.8 cents per share payable in October 2021, reflecting maximum amount
payable for H1 21 without downward adjustment to Norton's offer price
• Successful disposal of the Family Safety mobile business completed on 16 April
Notes:
(1) Growth figures excluding discontinued business, impact of acquisitions and disposals and FX. FX impact calculated by restating 2021 actuals to 2020 FX rates. Acquisition impact is adjusted by excluding current period
billings and revenue of acquisitions until the first anniversary of their consolidation. Billings and revenue of disposals until close of the transaction are included in the calculation of organic growth together with comparable
periods in the baseline. Discontinued business includes toolbar-related search distribution business, browser clean-up business and Jumpshot. 6Resilient Billings Growth Against Strong Prior Year
Organic
+2.4% (14.4)% +8.6% +0.9%
Growth %(1)
$9.2m
$4.2m
$2.0m
$(7.1)m
Consumer Direct Consumer Indirect SMB Group
Segment 86% 9% 5% 100%
% of total(2)
Notes:
(1) Growth figures excluding acquisitions, business disposals, discontinued business and impact of FX. Excludes current period billings of acquisitions until the first anniversary of their consolidation. Billings and revenue
of disposals until close of the transaction are included in the calculation of organic growth together with comparable periods in the baseline. FX impact calculated by restating 2021 actuals to 2020 FX rates
(2) Total Group excluding acquisitions, business disposals and discontinued business, numbers rounded to the nearest whole number 7Strong Revenue Growth Continues
Organic
+13.9% (14.3)% +10.2% +10.4%
Growth %(1)
$48.4m $43.7m
$2.4m
$(7.0)m
Consumer Direct Consumer Indirect SMB Group
Segment 85% 9% 6% 100%
% of total(2)
Notes:
(1) Growth figures excluding acquisitions, business disposals, discontinued business and impact of FX. Excludes current period billings of acquisitions until the first anniversary of their consolidation. Billings and revenue
of disposals until close of the transaction are included in the calculation of organic growth together with comparable periods in the baseline. FX impact calculated by restating 2021 actuals to 2020 FX rates
(2) Total Group excluding acquisitions, business disposals and discontinued business, numbers rounded to the nearest whole number 8Stable Consumer Direct Performance
Billings ($m) Revenue ($m)
2.4%(2) 13.9%(2)
• Consumer Direct organic billings grew by 2.4% in
the first half of 2021, with an unfavorable year-on-
year comparison due to the Covid spike in the first
half of 2020 and transition from multi-year to single
year subscriptions
412.5 401.6 • Sustained strong growth in the Privacy segment and
386.1
349.3 Mobile direct-to-consumer business
• Consumer Direct on track to deliver high-single digit
organic revenue growth in FY 2021
H1 2020 H1 2021 H1 2020 H1 2021
% of group
84% 86% 83% 85%
total(1)
Notes:
(1) Excluding acquisitions, business disposals and discontinued business. Excludes current period billings and revenue of acquisitions until the first anniversary of their consolidation
(2) Growth figures excluding acquisitions and impact of FX. Excludes current period billings and revenue of acquisitions until the first anniversary of their consolidation. FX impact calculated by restating 2021 actuals to
2020 FX rates 9Continued Strength in Consumer Direct
EoP customers(1)
(m)
16.47 16.72
• Sustained customer growth on both desktop and
2020 YE 2021 HY
mobile driven by the United States, LATAM and
ARPC(2) Russia
($)
• ARPC growth benefitting from strong prior year
45.60 47.61
deferred revenue
2020 YE 2021 HY
• Full year KPI metrics trending in line with guidance
APPC(3) of low single digit for customers and APPC, and
(x)
high-single digit for ARPC
1.41 1.42
2020 YE 2021 HY
Notes:
(1) Represents number of customers as at period end
(2) Average Revenue Per Customer in Consumer Direct
(3) Average Products Per Customer in Consumer Direct 10Mixed Results in Consumer Indirect
Billings ($m) Revenue ($m)
• Successful disposal of the Family Safety mobile
removing drag on Group billings and revenue
performance ((3.8)% impact on Consumer Indirect
(14.4)%(2) (14.3)%(2)
billings in the period to completion in H1(3))
• Avast Secure Browser delivered strong double-digit
growth as user activity and search volumes
remained resilient.
• Signed Google Search distribution agreement
49.1 49.1 covering Avast, AVG, CCleaner browsers including
42.5 42.5 mobile until 1 March 2023
• Accelerating contraction from Chrome distribution
means Consumer Indirect is now expected to
deliver a mid-single-digit organic revenue decline
H1 2020 H1 2021 H1 2020 H1 2021
% of group
11% 9% 12% 9%
total(1)
Notes:
(1) Excluding acquisitions, business disposals and discontinued business. Excludes current period billings and revenue of acquisitions until the first anniversary of their consolidation. Billings and revenue of disposals until
close of the transaction are included in the calculation of organic growth together with comparable periods in the baseline.
(2) Growth figures excluding discontinued business, disposal of Family Safety mobile business and impact of FX. FX impact calculated by restating 2021 actuals to 2020 FX rates 11
(3) Negative impact of decline in Family Safety Business on Group billings was (0.8)% in H1 2021.Good First Half Momentum in SMB
Billings ($m) Revenue ($m)
8.6%(2) 10.2%(2)
• Channel sales growth, led by the largest US market,
driven by strong renewal rates and a 3x increase in
Network Security sales
• Successful launch of the new Avast Business Hub, a
state-of-the-art security platform for channel partners,
managed security service providers (MSSPs), and
26.4 25.9 business customers to manage their cybersecurity
23.3 23.2
solutions
• Reconfirming mid-single digit organic revenue growth
for FY 2021 as comparatives into H2 toughen
H1 2020 H1 2021 H1 2020 H1 2021
% of group
5% 5% 6% 5%
total(1)
Notes:
(1) Excluding acquisitions, business disposals and discontinued business. Excludes current period billings and revenue of acquisitions until the first anniversary of their consolidation. Billings and revenue of disposals until
close of the transaction are included in the calculation of organic growth together with comparable periods in the baseline.
(2) Growth figures excluding impact of FX. FX impact calculated by restating 2021 actuals to 2020 FX rates 12Increase in Customer Retention Rates
• Overall customer retention rates at 69 percent, now up 4 ppts since IPO
• Renewals in H1 have remained resilient, with only minor degradation in the ‘Covid cohort’
• Customer experience initiatives reducing friction and supporting renewal trends
• Evidence of opportunity for further improvement as loyalty initiatives continue to ramp up
69% 69%
67%
65%
IPO FY 2019 FY 2020 H1 2021
132 H1 Financial Results:
Phil Marshall, CFO
14Billings and Revenue Performance
Billings ($m)
Change %
H1 2021 H1 2020 Change $ Change %
(excluding FX)(1)
Billings 482.7 469.1 13.5 2.9 (1.1)
Acquisitions 0.0 - 0.0 n/a n/a
Disposal Family Safety mobile business - 8.2 (8.2) n/a n/a
Discontinued Business 1.3 2.4 (1.1) (47.5) (48.5)
Billings excl. Acquisitions, Disposals and
481.4 458.5 22.8 5.0 0.9
Discontinued business
Revenue ($m)
Change %
H1 2021 H1 2020 Change $ Change %
(excluding FX)(1)
Revenue 471.3 433.1 38.1 8.8 7.7
Acquisitions 0.0 - 0.0 n/a n/a
Disposal Family Safety mobile business - 8.2 (8.2) n/a n/a
Discontinued Business 1.3 3.3 (2.0) (61.7) (62.4)
Revenue excl. Acquisitions, Disposals and
470.0 421.6 48.4 11.5 10.4
Discontinued business
Notes:
(1) Growth figures excluding impact of FX. FX impact calculated by restating 2021 actuals to 2020 FX rates
15H1 Group Billings Growth Adjusted for Non-Recurring Impacts
7.1% • H1 2020 additional benefit of 3.9% from
0.8% Covid effect on first purchases
1.5%
• 1.5% drag from the transition from multi-
year to single year subscriptions to
3.9% increase customer lifetime value. H2
benefit anticipated due to enlarged
renewal pool
• Disposal of the Family Safety mobile
business removed a drag on Group
billings performance, which it has
0.9% negatively impacted (0.8)% in the period
to completion
Combination of these factors means that a
Actual Covid-19 MY-SY(1) Family Normalized re-acceleration of Group billings to high
Safety
single-digit growth is anticipated in H2
disposal
Notes:
(1) Impact of Group’s transition from multi-year subscriptions (‘MY’) to single year (‘SY’)
16Revenue Growth Funding Re-Investment
Adj. EBITDA ($m)
EBITDA Margin % Comment
H1 2020 Actual 241 55.7%
Organic Revenue growth 42 383bps Strong revenue growth led by Consumer Direct
Positive YoY change due to 2020 Jumpshot costs up to
Discontinued Business 3 83bps
wind-down in the baseline
Positive FX impact on revenue outweighed by negative
FX impact (6) (183)bps
impact on costs
Investment / Disposal / Other (10) (123)bps Customer-focused S&M investments heavily H2 weighted
H1 2021 Actual 270 57.3%
17Strong Cash Flow Generation
($m) A• Increase in cash tax driven
H1 2021 H1 2020 largely by significant refund
Adj. EBITDA 270 241 received in H1 2020, as well as
increased advances due to
Adj. EBITDA to Adj. Cash EBITDA(1) 13 34 increased y-o-y profitability
Adj. Cash EBITDA 283 275 B• WC reflects favourable timing
of customers’ payments – will
Capex (3) (3)
reverse in H2
A Cash Tax (29) (7)
C• $23m out of total one time
B Change in Working Capital(2) 12 (2) $25m COVID donations paid in
H1 2020
C Covid Donations - (23)
D• Continued benefits from prior
Unlevered Free Cash Flow 263 241
actions – further decrease in
Cash Conversion(3) 93% 88% margins in March 2021
D Cash Interest and Lease Repayments (14) (20) • LFCF excludes $58m cash
consideration for sale of Family
Levered Free Cash Flow 249 221
Safety business (4)
Notes:
(1) Change in deferred revenue and deferred COGS as well as reversal of COGS deferral adjustments..
(2) Change in working capital excludes change in deferred revenue and deferred COGS as these are already included in Adj.Cash EBITDA
(3) Cash Conversion defined as Unlevered Free Cash Flow / Adj. Cash EBITDA 18
(4) Consideration for sale of Family Safety Business included also additional $8m received in form of common stock of Smith MicroSubscription Model Facilitates Continued De-leveraging
• Adjusted EBITDA leverage 1.0x
Net Debt ($m) Adj. EBITDA Leverage(1)
• On 22 March 2021 the Group completed a
complete repricing of its debt - repayment
(27)% 0.5x of old loan $828m, new loan drawn:
• 480m USD tranche at 200 bps & no floor
• 300m EUR tranche at 200 bps & no floor
• Repayment period extended by further 5
years from the prior expiry date in
726 1.5x
September 2023 to September 2028
527 1.0x • Cash position of $358m includes $58m
cash consideration received from disposal
of Family Safety mobile business (2)
• Final 2020 dividend paid in June 2021 in
Dec-20 Jun-21 Dec-20 Jun-21
amount of $(115)m
Notes:
(1) Leverage calculated as x Adj. LTM EBITDA. Net debt leverage per banking covenant 1.0x
(2) Consideration for sale of Family Safety Business included also additional $8m received in form of common stock of Smith Micro.
192021 Guidance
Full Year Guidance
2021 current guidance 2021 prior guidance (1)
Group Organic Revenue Growth Upper end of 6 – 8 percent range Upper end of 6 – 8 percent range
Consumer Direct Organic Revenue Growth High single-digit increase (upper end) High single-digit increase
• EoP Customers Low single-digit increase Low single-digit increase
• APPC (Average Product Per Customer) Low single-digit increase Low single-digit increase
• ARPC (Average Revenue Per Customer) High single-digit increase High single-digit increase
Consumer Indirect Organic Revenue Growth Mid-single-digit decline Low single-digit increase
SMB Organic Revenue Growth Mid-single-digit increase Mid-single-digit increase
Adj. EBITDA margin % Broadly flat Broadly flat
$4.8 cents per share c.40% levered free cash-flow
Dividend Distribution
Interim payable in Q3(2) Interim payable in Q3(2)
Notes:
(1) Prior guidance as updated after disposal of Family Safety mobile business
(2) Flat y-o-y interim dividend price per share Pursuant to the Co-Operation Agreement dated 10 August 2021 entered into between, amongst others, NortonLifeLock, Inc. ("Norton") and the Company and the terms of Norton’s
announcement of its firm intention to make an offer for the entire issued and to be issued share capital of the Company pursuant to Rule 2.7 of the City Code on Takeovers and Mergers (the “Rule 2.7 Announcement”), the
20
Company is permitted to declare and pay an interim dividend of 4.8 cents per share for the six-month period ended 30 June 2021, without such dividend resulting in a commensurate downward adjustment to the value of
Norton's offerKey Messages
• On 10 August 2021, the Boards of NortonLifeLock, Inc. ("Norton") and Avast plc (“Avast”) reached agreement on the terms of a
recommended merger of Company with Norton, in the form of a recommended offer by Nitro Bidco Limited, a wholly owned
subsidiary of Norton, for the entire issued and to be issued ordinary share capital of Avast.
• The combination with Norton offers strategic, operational and financial benefits for Avast and its stakeholders
• H1 performance in line with the Board’s expectations, FY21 guidance for organic revenue growth and adjusted EBITDA %
maintained
• Billings expected to return to high single digit growth in H2, with H1 reflecting strong Covid-19 baseline and downward pressure
from the Group’s transition to single year subscriptions to increase customer lifetime value
• Customer retention now at 69%, having held-up through the “Covid cohort” renewal period
• Avast One on track to launch in H2, encouraging early signs but will take time to develop and evolve
• Rapidly evolving cybersecurity landscape, with a shift towards protecting consumers’ entire digital lives, including their
identities. As a result, we see increased competition from major technology players, and other incumbents who are scaling-up
and evolving their offerings into integrated solutions to meet changing customer preferences
• Addressing this evolving landscape to sustain customer engagement, will require higher levels of margin investment in R&D,
marketing and other top-of-funnel acquisition & retention initiatives over the medium term, plus targeted acquisitions in a
competitive M&A environment
21Appendix
H1 Financial KPI’s
+0.9% +10.4% +9.0%
Organic Billings Organic Revenue Unlevered FCF
growth(1) growth(1)
$482.7m H121 or $471.3m H121 or Total UFCF $263.1m H121
+2.9% at actual rates +10.5% at actual rates vs $241.2m H120
Led by consumer direct Led by consumer direct
$270.2m $205.8m $0.20
Adj. EBITDA Adj. Net Income Adj. Diluted EPS
vs. $241.4m H120 vs. $169.8m H120 vs. $0.16 H120
159bps margin expansion to 57.3% 446bps margin expansion to 43.7% +20.5% at actual rates
+11.9% at actual rates +21.2% at actual rates
Notes:
(1) Growth figures excluding acquisitions, business disposals, discontinued business and impact of FX. Excludes current period billings of acquisitions until the first anniversary of their consolidation. Billings and revenue of
disposals until close of the transaction are included in the calculation of organic growth together with comparable periods in the baseline. FX impact calculated by restating 2021 actuals to 2020 FX rates 23Key Financial Assumptions
Full Year Guidance
2021 current guidance 2021 prior guidance
Depreciation & Amortisation c. 2% of Adj. Revenue c. 3% of Adj. Revenue
Capital Expenditure c. 2% of Adj. Revenue c. 2% of Adj. Revenue
Finance Cost and Lease Repayments (1) $25m P&L / $30m CF $30m P&L / $32m CF
Effective Tax Rate 18% 18%
Cash Tax P&L tax less $10m In line with Adjusted Income Tax
Net Working Capital (2) $5m outflow $10m outflow
Number of shares
• Basic weighted average number of shares 1,034m 1,034m
• Number of shares used in computing dilutive EPS 1,048m 1,048m
Exceptional Items
• Share-based expense $44m P&L $54m P&L
• Amortisation of acquired intangibles $23m P&L $23m P&L
Notes:
(1) Finance costs include interest costs, amortisation of arrangement fees, unwinding of discount, IFRS 16 related interest and other finance costs.
(2) Excludes change in deferred revenue and deferred COGS; includes only change in accounts receivable and accounts payable 24Revenue Trend by Segment
Revenue
($m)
Q1 Organic Q2 Organic H1 Organic
Q1 Q2 H1
growth %(1) growth %(1) growth%(1)
Consumer Direct 198.5 203.1 401.6 14.9 12.9 13.9
Consumer Indirect 25.0 17.5 42.5 (16.2) (11.5) (14.3)
SMB 12.9 13.0 25.9 11.8 8.7 10.2
Discontinued Business 0.7 0.6 1.3 n/a n/a n/a
Group Total 237.1 234.2 471.3 10.4 10.4 10.4
Notes:
(1) Growth figures excluding acquisitions, disposals and impact of FX. Excludes current period billings and revenue of acquisitions until the first anniversary of their consolidation. FX impact calculated by restating actuals
to FX rates of previous year
25Adjusted Profit and Loss
($m) H1 2021 H1 2020
Revenue 471.3 433.1
Cost of revenues (57.5) (57.5)
Gross profit 413.7 375.6
Gross profit % 87.8% 86.7%
Operating costs (143.6) (134.2)
EBITDA 270.2 241.4
EBITDA % 57.3% 55.7%
D&A (11.2) (10.6)
Operating profit 258.9 230.8
Finance costs (7.4) (21.6)
PBT 251.6 209.2
Income tax (45.8) (39.4)
Net Income 205.8 169.8
Net Income % 43.7% 39.2%
26Exceptional Items
Exceptional items, share-based compensation and amortization of acquisition intangibles ($m)
H1 2021 H1 2020
Share-based compensation(1) (17) (9)
Amortization of acquisition intangibles (12) (40)
Disposal of business operations (4) -
Jumpshot wind down costs - (25)
Covid-19 donations - (23)
Exceptional operating costs (4) (47)
Net gain on disposal of business operation 34 -
Unrealized FX gain/loss on EUR tranche of bank loan 16 2
Tax impact of IP transfer (3) (3)
Tax impact of disposal of business operation (13) -
Tax impact of adjusting items(2) (1) 14
Exceptional finance and tax income/(expense) (1) 13
Notes:
(1) Includes $(0.4)m employer’s cost on share-based payments exercise (H1 2020: $(0.4)m)
(2) Consists of tax impact of FX gain/loss on intercompany loans and other adjusting items 27Foreign Exchange Rates Trend (X-rates to US Dollar)
H1 2021
Currency YoY %
average
AUD 0.77 16.9%
BRL 0.18 (12.8)%
CAD 0.80 8.4%
CZK 0.05 10.4%
EUR 1.21 9.5%
GBP 1.39 8.8%
28Avast profit forecast
The following statements included in this presentation on slide [20] “2021 Guidance” constitute an ordinary course profit forecast for the purposes of Rule 28.1(a) and Note 2(b) on Rule 28.1 of the
City Code on Takeovers and Mergers (“Code”) (together, the “Avast Profit Forecast”):
Set out below is the basis of preparation in respect of the Avast Profit Forecast, together with the assumptions on which it is based.
“Group organic revenue growth: upper end of 6 – 8 percent range”, “Adj. EBITDA margin %: broadly flat”
Basis of preparation
The Avast Profit Forecast has been prepared on a basis consistent with the Avast Group’s accounting policies which are in accordance with IFRS. These policies are consistent with those applied in
the preparation of the Avast Group’s annual results for the year ended 31 December 2020.
The Avast Profit Forecast excludes any transaction costs applicable to the Merger or any other associated accounting impacts as a direct result of the Merger.
Assumptions
The Avast Profit Forecast is based on the assumptions listed below.
Factors outside the influence or control of the Avast Directors
• There will be no material changes to existing prevailing macroeconomic or political conditions in the markets and regions in which the Avast Group operates.
• There will be no material changes to the conditions of the markets and regions in which the Avast Group operates or in relation to customer demand or the behaviour of competitors in those
markets and regions.
• The interest, inflation and tax rates in the markets and regions in which the Avast Group operates will remain materially unchanged from the prevailing rates.
• There will be no material adverse events that will have a significant impact on the Avast Group’s financial performance.
• There will be no material adverse events that will have a significant impact on the timing and market acceptance of new product releases and upgrades by the Avast Group.
• There will be no business disruptions that materially affect the Avast Group or its key customers, including natural disasters, acts of terrorism, cyberattack and/or technological issues or supply
chain disruptions.
• There will be no material changes to the foreign exchange rates that will have a significant impact on the Avast Group’s revenue or cost base.
• There will be no material changes in legislation or regulatory requirements impacting on the Avast Group’s operations or on its accounting policies.
• There will be no material litigation in relation to any of the Avast Group’s operations.
• The Merger will not result in any material changes to the Avast Group’s obligations to customers.
• The Merger will not have any material impact on the Avast Group’s ability to negotiate new business.
Factors within the influence and control of the Avast Directors
• There will be no material change to the present management of the Avast Group.
• There will be no material change in the operational strategy of the Avast Group.
• There will be no material adverse change in the Avast Group’s ability to maintain customer and partner relationships.
• There will be no material acquisitions or disposals.
• There will be no material strategic investments over and above those currently planned.
• There will be no material change in the dividend or capital policies of the Avast Group.
• There will be no unexpected technical or network issues with products or processes.
Avast Directors’ confirmation
With the consent of NortonLifeLock, the Takeover Panel has granted a dispensation from the Code requirement for Avast’s reporting accountants and financial advisers to prepare reports in respect
of the Avast Profit Forecast. The Avast Directors have considered the Avast Profit Forecast and confirm that it remains valid as at the date of this Announcement, and has been properly compiled on
the basis of the assumptions set out in this slide and that the basis of the accounting used is consistent with Avast’s accounting policies.
29You can also read
