CONTACT:

Jason Reid
Stagwell Inc.
IR@StagwellGlobal.com

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CONTACT:

Sarah Arvizo
pr@stagwellglobal.com

First Stadium-Level AR Platform for Large-Scale Venues, ARound Builds on 2022 Experiences with the Minnesota Twins and Los Angeles Rams, with Opening Day Launch at Kauffman Stadium

NEW YORK and KANSAS CITY, Mo., March 30, 2023 /PRNewswire/ — ARound, a next-generation fan engagement platform designed to enhance gameday fun with live, real-world augmented reality (AR) experiences – and part of the Stagwell (NASDAQ: STGW) Marketing Cloud – has expanded its professional sports partnerships to include the Kansas City Royals for the 2023 baseball season. Launching in Kauffman Stadium today, “Crown Vision AR” provides the venue’s 38,000 fans with a shared AR experience that includes interactive follow-along features after base hits and plays, contests, fan loyalty features, and brand sponsorships custom to the Royals.

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Sarah Arvizo
pr@stagwellglobal.com

CONTACT:

Sarah Arvizo
Stagwell
pr@stagwellglobal.com 

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Sarah Arvizo
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With record growth in 2022, GALE secures top industry accolades, demonstrating its prowess as an industry agency leader.

NEW YORK, March 15, 2023 /PRNewswire/ — GALE, a Business Agency, is proud to announce its win of two top industry awards: Ad Age’s A-List and Adweek’s Breakthrough Media Agency of the Year. The honors recognize the agency’s outstanding growth and its integrated, results-driven approach to working with leading industry clients like H&R Block, Chipotle, MilkPEP, and Hard Rock International among others.

Founded in 2014, GALE has grown to more than 700 employees across nine offices globally. Combined with this significant growth in headcount, GALE experienced a more than 130% increase in revenue last year, making the company one of the fastest-growing agencies in the US.

“This has been a banner year for GALE; being honored by Ad Age and Adweek on the heels of an exceptional growth year is particularly special. We’ve significantly expanded our teams, brought new expertise into the fold and started working with a number of new clients. But ultimately, this is a moment to recognize all the great people that work at GALE and the great clients we partner with,” said GALE CEO and President Brad Simms.

In 2021, GALE was named Ad Age’s Data & Analytics Agency of the Year, but 2023 marks the first time GALE has been named to Ad Age’s A List, coming in at number five. “We started as seven people specializing in consulting and data and today, we service a client’s every need as true business partners, delivering fully integrated solutions and recoupling creative and media. These industry awards highlight the gains we’ve made as a business, but more importantly, our team’s continued focus to help our clients drive meaningful business results,” Simms added.

As Adweek’s Breakthrough Media Agency of the Year, GALE is recognized for its powerful and growing media practice. Four years into offering this capability, GALE manages a billion dollars in media billings, servicing clients seeking alternatives to traditional media networks.

“At GALE, we live by a simple equation: great people + great clients + great culture = great work,” said Simms. “On the inside, we see this equation hard at work in countless ways across the business. It is an honor to receive such incredible recognition and validation from the broader industry. These awards are testaments to the team at GALE, their dedication, high standard of work excellence, and our many loyal, extraordinary client partners.”

About GALE
GALE is a Business Agency. We bring business insights to brand storytelling and activate across every channel. With expertise in business strategy, CRM, loyalty, brand storytelling, integrated, performance, creative, and content marketing, experience design and media, GALE creates marketing systems and communications that grow businesses. GALE delivers strong business outcomes for its partners in automotive, QSR, retail, gaming, entertainment, telecom and more. Founded in 2014, the agency currently has offices in New York, Singapore, Toronto, Denver, Los Angeles, London, Austin, Kansas City and Bengaluru. GALE has received top industry awards including Ad Age‘s A-List, Ad Age‘s Data & Analytics Agency of the Year, Adweek‘s Fastest Growing Agency and Adweek‘s Breakthrough Media Agency of the Year. For information on GALE, its customer data platform Alchemy™ and its consumer research capability ASK GALE, visit: https://gale.agency/.

CONTACT
Lindsay Bennett
lindsay.bennett@galepartners.com
917 497 5582

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FY22 Revenue rises to record $2.7B following sixth-consecutive quarter of double-digit growth; company doubles stock buyback program to $250M

FY22 Revenue rises to record $2.7B following sixth-consecutive quarter of double-digit growth; company doubles stock buyback program to $250M 

• FY22 Pro Forma revenue growth of 21%; 16% in Q4
• FY22 Pro Forma organic net revenue growth of 14%; 8% in Q4
• Adjusted EBITDA of $451M in FY22, a 20.3% margin on net revenue
• Adjusted EBITDA of $123M in Q4, a 21.1% margin on net revenue
• FY22 Adjusted net income of $268M; $63M in Q4
• FY22 Adjusted EPS of $0.90; $0.22 in Q4
• FY22 Free Cash Flow of $270M; $268M in Q4
• FY22 Net New Business of $213M; $42M in Q4
• Reduced net debt by $47M versus prior year, ending with a net leverage ratio of 2.17x
• Issues 2023 Organic Net Revenue growth guidance of 7.5%-10% and 10%-14% ex-Advocacy
• Issues 2023 Adjusted EBITDA guidance of $450M-$490M and Free Cash Flow conversion of 50%-60%

New York, NY, March 2, 2023 (NASDAQ: STGW) – Stagwell Inc. (“Stagwell”) today announced financial results for the three months and year ended December 31, 2022.

FOURTH QUARTER AND FULL YEAR HIGHLIGHTS:

• Q4 revenue of $708 million, an increase of 16% versus the prior year period; FY22 revenue of $2,688 million, an increase of 83% versus the prior year period
• Q4 revenue growth of 16% versus the prior year period and 13% ex-Advocacy; Pro Forma FY22 revenue growth of 21% versus the prior year period and 17% ex-Advocacy
• Q4 net revenue of $583 million, an increase of 12% versus the prior period; FY22 net revenue of $2,222 million, an increase of 75% versus the prior year period
• Q4 net revenue growth of 12% versus the prior year period and 10% ex-Advocacy; Pro Forma FY22 net revenue growth of 15% versus the prior year period and 13% ex-Advocacy
• Q4 organic net revenue growth of 8% versus the prior year period and 6% ex-Advocacy; Pro Forma FY22 organic net revenue growth of 14% versus the prior year period and 12% ex-Advocacy
• Q4 Adjusted EBITDA of $123 million, an increase of 19% versus the prior year period; FY22 Adjusted EBITDA of $451 million, an increase of 78% versus the prior year period
• Q4 Adjusted EBITDA growth of 19% versus the prior period and 10% ex-Advocacy; Pro Forma FY22 Adjusted EBITDA growth of 19% versus the prior period and 12% ex-Advocacy
• Q4 Adjusted EBITDA Margin of 21.1% on net revenue; FY22 Adjusted EBITDA Margin of 20.3% on net revenue
• Q4 net loss of $28 million versus net income of $5 million in the prior year period; FY22 net income of $66 million versus $36 million in the prior year period
• Q4 net loss attributable to Stagwell Inc. common shareholders of $6 million versus net income of $1 million in the prior year period; FY22 net income attributable to Stagwell Inc. common shareholders of $27 million versus $21 million in the prior year period
• Q4 Adjusted net income of $63 million; FY22 Adjusted net income of $268 million
• Q4 Adjusted earnings per share for Stagwell Inc. common shareholders of $0.22; FY22 Adjusted earnings per share of $0.90
• Q4 net new business of $42 million; FY22 net new business of $213 million

“Stagwell closed out 2022 with industry-leading double-digit growth, strong margin expansion, record free cash flow, record earnings per share, and a net debt ratio significantly below our target. We promised to transform marketing, and we have built game-changing AI and AR-driven products as we continue to grow and transform both our business and the industry,” said Mark Penn, Chairman and CEO, Stagwell. “We look forward to another year of double-digit growth outside of our advocacy businesses in 2023, continuing our momentum.”

Frank Lanuto, Chief Financial Officer, commented: “The Company reported a record $708 million of revenue in the fourth quarter, a 16% increase over the prior year and Adjusted EBITDA of $123 million. Adjusted EBITDA margin as a percentage of net revenue rose to 21.1% for the quarter and 20.3% for the year as a result of careful cost management. Free cash flows rose to $270 million driving down the Company’s net leverage ratio to 2.17x.”

Financial Outlook

2023 financial guidance is as follows:

• Organic Net Revenue growth of 7.5% – 10%
• Organic Net Revenue growth ex-Advocacy of 10% – 14%
• Adjusted EBITDA of $450 million – $490 million
• Free Cash Flow Conversion of 50% – 60%
• Adjusted EPS of $0.90 – $1.05
• Guidance assumes no impact from foreign exchange, acquisitions or dispositions.

Stock Repurchase Program

On March 1, 2023, the Board authorized an extension and a $125,000,000 increase in the size of our previously approved  stock repurchase program (the “Repurchase Program”). Under the Repurchase Program, as amended, we may repurchase up to an aggregate of $250,000,000 of shares of our outstanding Class A Common Stock, with any previous purchases under the Repurchase Program continuing to count against that limit. The Repurchase Program will expire on March 1, 2026.

Conference Call

Management will host a video webcast and conference call on Thursday, March 2, 2023, at 8:30 a.m. (ET) to discuss results for Stagwell Inc. for the three months and year ended December 31, 2022. The video webcast will be accessible at https://stgw.io/Q4andFYEarnings. An investor presentation has been posted on our website at www.stagwellglobal.com and may be referred to during the conference call.

A recording of the conference call will be accessible one hour after the call and available for ninety days at www.stagwellglobal.com.

Stagwell Inc.

Stagwell is the challenger network built to transform marketing. We deliver scaled creative performance for the world’s most ambitious brands, connecting culture-moving creativity with leading-edge technology to harmonize the art and science of marketing.  Led by entrepreneurs, our 13,000+ specialists in 34+ countries are unified under a single purpose: to drive effectiveness and improve business results for their clients. Join us at www.stagwellglobal.com.

Contacts

For Investors:

Jason Reid

Ir@stagwellglobal.com

For Press:

Beth Sidhu

Pr@stagwellglobal.com

Basis of Presentation

The acquisition of MDC Partners (MDC) by Stagwell Marketing Group (SMG) was completed on August 2, 2021. The results of MDC are included within the Statements of Operations for the period beginning on the date of the acquisition through the end of the respective period presented and the results of SMG are included for the entirety of all periods presented.

Non-GAAP Financial Measures

In addition to its reported results, Stagwell Inc. has included in this earnings release certain financial results that the Securities and Exchange Commission (SEC) defines as “non-GAAP Financial Measures.” Management believes that such non-GAAP financial measures, when read in conjunction with the Company’s reported results, can provide useful supplemental information for investors analyzing period to period comparisons of the Company’s results. Such non-GAAP financial measures include the following:

Pro Forma Results: The Pro Forma amounts presented for each period were prepared by combining the historical standalone statements of operations for each of legacy MDC and SMG. The unaudited pro forma results are provided for illustrative purposes only and do not purport to represent what the actual consolidated results of operations or consolidated financial condition would have been had the combination actually occurred on the date indicated, nor do they purport to project the future consolidated results of operations or consolidated financial condition for any future period or as of any future date. The Company has excluded a quantitative reconciliation of Adjusted Pro Forma EBITDA to net income under the “unreasonable efforts” exception in Item 10(e)(1)(i)(B) of Regulation S-K.

(1) Organic Revenue: “Organic revenue growth” and “organic revenue decline” refer to the positive or negative results, respectively, of subtracting both the foreign exchange and acquisition (disposition) components from total revenue growth. The acquisition (disposition) component is calculated by aggregating prior period revenue for any acquired businesses, less the prior period revenue of any businesses that were disposed of during the current period. The organic revenue growth (decline) component reflects the constant currency impact of (a) the change in revenue of the partner firms that the Company has held throughout each of the comparable periods presented, and (b) “non-GAAP acquisitions (dispositions), net”. Non-GAAP acquisitions (dispositions), net consists of (i) for acquisitions during the current year, the revenue effect from such acquisition as if the acquisition had been owned during the equivalent period in the prior year and (ii) for acquisitions during the previous year, the revenue effect from such acquisitions as if they had been owned during that entire year (or same period as the current reportable period), taking into account their respective pre-acquisition revenues for the applicable periods, and (iii) for dispositions, the revenue effect from such disposition as if they had been disposed of during the equivalent period in the prior year.

(2) Net New Business: Estimate of annualized revenue for new wins less annualized revenue for losses incurred in the period.

(3) Adjusted EBITDA: defined as Net income excluding non-operating income or expense to achieve operating income, plus depreciation and amortization, stock-based compensation, deferred acquisition consideration adjustments, and other items. Other items include restructuring costs, acquisition-related expenses, and non-recurring items.

(4) Adjusted Diluted EPS is defined as (i) Net income (loss) attributable to Stagwell Inc. common shareholders, plus net income attributable to Class C shareholders, excluding amortization expense, impairment and other losses, stock-based compensation, deferred acquisition consideration adjustments, discrete tax items, and other items, divided by (ii) (a) the per weighted average number of common shares outstanding plus (b) the weighted average number of Class C shares outstanding (if dilutive). Other items includes restructuring costs, acquisition-related expenses, and non-recurring items, and subject to the anti-dilution rules.

(5) Free Cash Flow: defined as Adjusted EBITDA less capital expenditures, change in net working capital, cash taxes, interest, and distributions to minority interests, but excludes contingent M&A payments.

(6) Financial Guidance: The Company provides guidance on a non-GAAP basis as it cannot predict certain elements which are included in reported GAAP results.

Included in this earnings release are tables reconciling reported Stagwell Inc. results to arrive at certain of these non-GAAP financial measures.

This document contains forward-looking statements. within the meaning of Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). The Company’s representatives may also make forward-looking statements orally or in writing from time to time. Statements in this document that are not historical facts, including, statements about the Company’s beliefs and expectations, future financial performance and future prospects, business and economic trends, potential acquisitions, and estimates of amounts for redeemable noncontrolling interests and deferred acquisition consideration, constitute forward-looking statements. Forward-looking statements, which are generally denoted by words such as “anticipate,” “assume,” “believe,” “continue,” “could,” “create,” “estimate,” “expect,” “focus,” “forecast,” “foresee,” “future,” “guidance,” “intend,” “look,” “may,” “opportunity,” “outlook,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “target,” “will,” “would” or the negative of such terms or other variations thereof and terms of similar substance used in connection with any discussion of current plans, estimates and projections are subject to change based on a number of factors, including those outlined in this section.

Forward-looking statements in this document are based on certain key expectations and assumptions made by the Company. Although the management of the Company believes that the expectations and assumptions on which such forward-looking statements are based are reasonable, undue reliance should not be placed on the forward-looking statements because the Company can give no assurance that they will prove to be correct. The material assumptions upon which such forward-looking statements are based include, among others, assumptions with respect to general business, economic and market conditions, the competitive environment, anticipated and unanticipated tax consequences and anticipated and unanticipated costs. These forward-looking statements are based on current plans, estimates and projections, and are subject to change based on a number of factors, including those outlined in this section. These forward-looking statements are subject to various risks and uncertainties, many of which are outside the Company’s control. Therefore, you should not place undue reliance on such statements. Forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update publicly any of them in light of new information or future events, if any.

Forward-looking statements involve inherent risks and uncertainties. A number of important factors could cause actual results to differ materially from those contained in any forward-looking statements. Such risk factors include, but are not limited to, the following:

• risks associated with international, national and regional unfavorable economic conditions that could affect the Company or its clients;
• inflation and actions taken by central banks to counter inflation;
• the Company’s ability to attract new clients and retain existing clients;
• the impact of a reduction in client spending and changes in client advertising, marketing and corporate communications requirements;
• financial failure of the Company’s clients;
• the Company’s ability to retain and attract key employees;
• the Company’s ability to compete in the markets in which it operates;
• the Company’s ability to achieve its cost saving initiatives;
• the Company’s implementation of strategic initiatives;
• the Company’s ability to remain in compliance with its debt agreements and the Company’s ability to finance its contingent payment obligations when due and payable, including but not limited to those relating to redeemable noncontrolling interests and deferred acquisition consideration;
• the Company’s ability to manage its growth effectively, including the successful completion and integration of acquisitions that complement and expand the Company’s business capabilities;
• the Company’s ability to develop products incorporating new technologies, including augmented reality, artificial intelligence, and virtual reality, and realize benefits from such products;
• an inability to realize expected benefits of the combination of the Company’s business with the business of MDC; (the “Business Combination” and, together with the related transactions, the “Transactions”);
• adverse tax consequences in connection with the Transactions for the Company, its operations and its shareholders, that may differ from the expectations of the Company, including that future changes in tax law, potential increases to corporate tax rates in the United States and disagreements with the tax authorities on the Company’s determination of value and computations of its attributes may result in increased tax costs;
• the occurrence of material Canadian federal income tax (including material “emigration tax”) as a result of the Transactions;
• the Company’s unremediated material weaknesses in internal control over financial reporting and its ability to establish and maintain an effective system of internal control over financial reporting;
• the Company’s ability to protect client data from security incidents or cyberattacks;
• economic disruptions resulting from war and other geopolitical tensions, terrorist activities and natural disasters;
• stock price volatility; and
• foreign currency fluctuations.

Investors should carefully consider these risk factors, other risk factors described herein, and the additional risk factors outlined in more detail in our 2021 Form 10-K, filed with the Securities and Exchange Commission (the “SEC”) on March 17, 2022, and accessible on the SEC’s website at www.sec.gov, under the caption “Risk Factors,” and in the Company’s other SEC filings.

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Alex Birmingham
KWT Global
abirmingham@kwtgloblal.com

Emily Falcone
Axios
emily.falcone@axios.com

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Sarah Arvizo
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CONTACT:

Brandon Dixon
pr@stagwellglobal.com

Launched in 2020, the Program is Built to Serve Organizations Supporting Black and Systemically Excluded Communities

NEW YORK and PORTLAND, Ore., Feb. 8, 2023 /PRNewswire/ — Instrument, a leading digital agency within Stagwell (NASDAQ: STGW), opened applications today for its Build. Grow. Serve. (BGS) pro bono program, an ongoing $3 million agency commitment to support and empower Black and systemically excluded communities. Applications are open at this link. The program includes three tenets:

• Build, in which Instrument donates hours of design, strategy and development work to nonprofit organizations
• Grow, Instrument’s donation matching initiative, which to date has contributed over $355,000 to organizations advancing equity
• Serve, a volunteer time-off benefit, affording each Instrument employee 16 hours of paid time off per year to volunteer with nonprofits of their choosing

Instrument seeks applications from organizations that are working to support Black & systemically excluded communities. 

Instrument seeks applications from organizations that are working to support Black and systemically excluded communities, fight prejudice, or pursue a more just and inclusive future. Selected organizations will receive pro bono support from Instrument, including strategy, creative, and technology services, to accelerate the impact their organizations are delivering to these communities. The partnership will culminate in a completed project by the end of 2023.

“Our Build. Grow. Serve. program is foundational to who we are at Instrument – and representative of how we think all companies need to show up in today’s world,” said Kara Place, CEO, Instrument. “Our partnerships with organizations that are actively making the world a better place allow us to amplify their work and mission, and provide opportunities for our employees to use their skills in meaningful ways.”

In 2022, the program supported BlackSpace, a collective or urbanists, architects, policymakers, artists, and advocates co-creating spaces that affirm and amplify Black presence in public spaces. During the partnership, Instrument created an evolved brand, design system, and a reimagined digital experience that empowers the organization to scale its mission.

“We can’t believe our eyes – the final results are beyond what we could’ve imagined. Instrument has given us something really special, and we’re so happy with all the hard work of everyone involved,” said BlackSpace Co-Managing Director Emma Osore. “The attention to creating approachable language and guides, providing updates at every turn, and sensitivity to our budget were especially generous touches that did not go unnoticed and were highly appreciated.”

Work completed for Instrument’s inaugural BGS partner, BankBlackUSA, a grassroots organization with a mission to promote financial advocacy in Black communities, was recognized in Fast Company’s 2022 Innovation by Design Awards across three key categories: Finance, Graphic Design and Impact.

To apply for the 2023 BGS program, complete this short application form , outlining your organization’s mission, goals, and the type of support needed. Applications will close Wednesday, March 10. For questions about the application, please contact Shanelle Felice, Associate Director, Business Development and Build. Grow. Serve co-lead at shanelle.felice@instrument.com.

About Instrument
Instrument is a values-driven digital agency with offices in Portland, Oregon, Brooklyn, New York, and Los Angeles, California. We are a dynamic group of creative technologists and storytellers that use the power of design and technology to co-create groundbreaking work with our clients. We connect brands like never before—helping organizations reimagine the most valuable pieces of their digital ecosystem. With deep talent in the areas of Strategy, Design, Development and Content Creation, we build modern experiences for ambitious brands.

About Stagwell
Stagwell is the challenger network built to transform marketing. We deliver scaled creative performance for the world’s most ambitious brands, connecting culture-moving creativity with leading-edge technology to harmonize the art and science of marketing. Led by entrepreneurs, our 13,000+ specialists in 34+ countries are unified under a single purpose: to drive effectiveness and improve business results for their clients. Join us at www.stagwellglobal.com.

Contact: Brandon Dixon; pr@stagwellglobal.com

SOURCE Stagwell Inc.