Augustus Media Holdings Ltd

Annual Report & Accounts 2021

 FINANCIAL HIGHLIGHTS

LETTER TO SHAREHOLDERS

PERFORMANCE

PROJECTIONS

CONTENTS REGIONAL PRESENCE

LEADERSHIP TEAM

CEO EXCLUSIVE

FINANCIAL STATEMENTS
Letter to shareholders

By all accounts, 2021 was an exceptional year. Emerging from a global Content revenue picked up pace, with the support of our Advertising revenue
pandemic still felt from the previous year and finishing the year stronger than which was introduced mid 2020 ended to play 20% of our total Revenue
expected. share in 2021. The substantial growth within these two revenue streams
allowed us to double our previous year Gross Revenue.

Agency revenue came back into play late Q1 after all their clients paused all
Dear Shareholders, their budget since March 2020. This revenue was close to lost for as long as 11
months, an illustration of how Augustus is unreliant on a single client type.
When the pandemic hit back in early 2020, our business as well as well as the Direct client revenue has been the most secure source of revenue since the
expert analysts forecasted the impact of covid-19 will persist for at least 2 establishment of the business back in 2015, and will remain this way. Revenue
year. This was a concern, as our revenue dropped by 80% at some point earned from Agency, Advertising Partners, and Direct to Consumer will allow
between March and April, businesses continued to struggle throughout the the business to overachieve its annual target year on year, as we have only
entirety of 2020 and beginning of 2021. Our expectations based on the news tapped a minor percentage of the revenue share available in the market.
circulated in the market in early 2021 is that we should expect a year identical
to 2020. 2021 was a key focus to setup our company pillars to what we expect in the
next 4 years to come. It has been estimated that Augustus will achieve $11m
Commercially we forecasted annual gross revenue targets at $4m, which in Net Revenue, $15m Gross by end of 2025, the following forecast is based on
puts us close to 40% increase against 2020. These projections changed a sustainable year on year growth on 33%, a goal we are likely to overachieve
much quicker than anticipated, by end of H1 our top line figures surpassed in a shorter period of time.
our forecast, by Q4 our Gross Revenue forecast reached to $5.5m, a 38%
increase from the original forecast set in early Q1.

We continued to grow our top line and bottom line at an accelerated pace,
the expansion plans we had set pre-pandemic became more likely towards
end of H1. We went from a business that is riding the wave along with the rest,
to leading the tide.

The business continued to focus on long-term sustainability and plans to

reduce cost while achieving high performance. Augustus Misr, came into the
picture by the start of H2, as we struggled to outsource tech developers and
content writers - a plan to initiate an in-house tech & content hub for the
region emerged. The decision to launch Augustus Misr came at a perfect
time, developing existing platforms as well as introducing new products gave
the business an upper edge.
Letter to shareholders

2022 has started strongly, well in line with our latest three-year plan to triple Financial Performance
our revenue organically in the next three years.
Gross Revenue: $5.70 million, up 97% from previous year, up 7% from latest
We opened our doors to our new Headquarters in Dubai as well as signing an targets and up 40% from original targets.
office expansion for our Cairo office. These initiative give us a head start to
our 4 year plans, and put us inline with the company’s long term objectives. Revenue Turnover: $3.83 million, up 78% from previous year, up 1% from latest
targets and up 19% from original target.
The next 4 years will be focused on exploring new territories, whether through
self established subsidiaries or through joint ventures which will allow the Net Revenue: $3.64 million, up 85% from previous year, up 5% from latest
Lovin brand to reach over 10 different countries, and more than 20 different targets and up 23% from original targets.
cities by the end of 2025. Headcount wise we look to have 120 employees
working across the region. Barter: $192 thousand, up 11% from previous year, down 39% from latest
targets and down 29% from original targets.*
Our strategy is to have core Augustus Media entities in Dubai, Riyadh and
Cairo, operating a JV model with 'lovin' in cities in other countries. Gross Profit: $3.18 million, up 70% from previous year, down 3% from latest
targets and up 15% from original targets.
Focus on youth Audiences, millennial and gen z, with brand IP's, and 'non
scripted' content on text, audio and video.
Cost of Revenue: $582 thousand, up 58% from previous year, up 15% from
latest budgets and up 23% from original budgets.
Both brands will progress the linear and on demand live cloud based
production.
Operating Expense: $2.36 million, up 48% from previous year, up 5% from
latest budgets and in-line with original budgets.
Commercially, our focus will be on the 3 main revenue stream buckets:
1. Advertising & Creator economy - audience, social, video revenue, Operating Profits: $885 thousand, up 230% from previous year, down 12%
2. Branded content, from latest targets and up 125% from original targets.*

3. Direct to consumer - subscription and token economy (crypto)

*Barter revenue is subjected to recognizing the revenue in both side, Augustus has achieved +350k intotal Barter Revenue, of which close to 50% unrecognized.
*Finalization of Annual Bonuses, Agency AVR and Bad-Debt provision is subjected to year end closure and could change against the latest targets.
Financial Highlights
USD

GROSS REVENUE REVENUE TURNOVER

5.70m +97% 3.83m +78%

NET REVENUE (Excl. Barter)* BARTER

3.64m +85% 192k +11%

Performance Comparison 2020

Financial Highlights
USD

GROSS PROFIT COST OF REVENUE

3.18m +70% 582k +58%

OPERATING EXPENSE OPERATING PROFITS

2.36m +48% 885k +230%

Performance Comparison 2020

Performance by Client Class
USD

AGENCY DIRECT

1.15m 30% 1.71m 45%

PARTNERS BARTER

780k 20% 192k 5%

Above Figures are Revenue Turnover

Performance by Brand
USD

BRAND Q1 Q2 Q3 Q4 TOTAL

Lovin Dubai 358k 441k 472k 1.13m 2.40m

Lovin Saudi 31k 103k 77k 84k 295k

Smashi 152k 145k 180k 243k 720k

ODEUM 54k 78k 47k 46k 225k

Total 595k 767k 776k 1.50m 3.64m

Above Figures are Revenue Turnover & Exclude Barter Revenue
Performance 2018 - 2021
USD

BRAND 2018 2019 2020 2021 TOTAL

Lovin Dubai 1.37m 2.00m 1.32m 2.40m 7.09m

Lovin Saudi 60k 176k 150k 295k 681k

Smashi 0k 0k 372k 720k 1.09m

ODEUM 146k 105k 137k 225k 613k

Total 1.57m 2.28m 1.98k 3.64m 9.48m

Above Figures are Revenue Turnover & Exclude Barter Revenue
Performance 2018 - 2021
Quarterly Revenue Change

PreCovid
Trendline

Actual
Trendline
Performance by Territory

-6%
EGY 24%
OPM
52%
UAE

54%
KSA

67%
OPM
Performance by platform
Projections 2022
USD

BRAND 2018 2019 2020 2021 2022

Lovin Dubai 1.37m 2.00m 1.32m 2.40m 3.20m (+33%)

Lovin Saudi 60k 176k 150k 295k 550k (+86%)

Smashi 0k 0k 372k 720k 750k (+4%)

ODEUM 146k 105k 137k 225k 250k (+11%)

Total 1.57m 2.28m 1.98m 3.64m 4.75m(+31%)

Projections 2022 - 2025
USD

2021 (Previous)

3.64m +84%

2022 2023

4.75m +31% 6.25m +32%

2024 2025

8.25m +32% 11.00m +33%

Year On Year Comparison
Regional Presence by 2025
Territories

JV/Virtual

2021

2022

2023

2024

2025

120 Staff Headcount by 31 Dec 2025

Leadership Team

Richard Fitzgerald F. Josef Obeid Amy Jones Michael Smith

CEO & Founder Finance Director Sr. Content Director Grp. Commercial Director

Mayowa Tola-Voss Casey Fitzgerald Abdallah Nasser Iyad Saady

Commercial Director Sr. Writer & Host Manager Sr. Product Manager Sr. Country Manager
CEO & Founder Exclusive:
12 Predictions For The MENA Media Industry In 2022

With the development of Dubai, a media capital, post-pandemic, Augustus

Media CEO and Founder, Richard Fitzgerald shared 2022 predictions in line with
the growing region and world of modern media.
● The global investment in streaming content will spill over to the Middle
East

The main US streaming companies plan to spend $115 billion on content in

2022. Disney will spend $23 billion on content, up 35% in 2021, or $33 billion
when sports rights are included, and Netflix will spend $17 billion next year, up
25% (via the FT).

Numbers aren’t known on what Shahid, Netflix, Amazon Prime are investing in
Arabic content; however, to put it into perspective, Shahid has spent over $1
billion on content in the last decade.

Telfaz11 in Saudi Arabia has an 8 movie deal with Netflix and recently received
another round of funding, so they will be well placed to produce more content.
Regional production companies are now focusing on streaming platforms and
social media even more. This is great for the consumer.

● Publishers will experiment in NFT’s more and more

This space is exploding. The lines between the Metaverse and Crypto are
blurring, crossing over social platforms, gaming companies and into every
sector. For the case of media, we will see more project launches as NFT’s are
linked to utilities; which include great access to events and more. Last year,
Time launched a collection of historic magazine covers as NFT’s, selling
between $55k and $138k. Decrypt, a crypto publisher launched their own
Richard Fitzgerald reward tokens, giving points to their audience for engagement. The same
CEO & Founder publisher also launched a content studio for NFT’s, Decrypt Studios. There are
some interesting projects out of Dubai up until now in the NFT space, a Dubai
company bought the first-ever New York Times NFT and Lovin Dubai created
an NFT of our first-ever article. Others will stay on the sidelines and believe that
there is a lot of froth out there, expecting a pop.
CEO & Chairman Exclusive:
12 Predictions For The MENA Media Industry In 2022

● The creator economy will create the next media companies in the ● Disney+ Will Launch In The Middle East
region
Not a massive prediction, as we know they are going global later this year. It
Known as influencers in the region, the creator will have new lease of life. would mean cutting ties with OSN where the Disney Plus content is already
Facebook, Snapchat, Twitter, YouTube all have studios and product features to available. As Disney Plus is cited as the main global competition to Netflix, it
enable creators to publish and monetize content. Some of these funds were would also bring a new player to watch in terms of subscriber numbers in the
only available in the US, but more so they are being made available for the MENA region, alongside Amazon Prime, Shahid, Starzplay and Disney. The other
Arab region. For audio too, Spotify, Facebook, Apple are all investing US services are Paramount+ and HBO Max, and Peacock, some may venture to
significantly in this space. Platforms like Substack and Patreon grow in Europe but it wouldn’t be expected for them to launch here.
popularity, not as fast in this region, as an advertising model is preferred to
fund media businesses, but that might shift gradually towards subscriptions. ● Linear streaming channels begin to take off

This graph shows the influence Joe Rogan has had on media in the US. Saudi Up until now, the streaming wars have focused on the premium on-demand.
gamer YouTube channel was acquired by Webedia last year, we will see more Pay-TV control of sports rights has prevented a sports linear streaming service
of this from Instagrammers, YouTubers and Podcasters, turning their channel from taking off, however, DAZN and ESPN+ have had some success in other
into nimble media companies. markets. Here, Shahid have lately started adding streaming sports, and
Starzplay did for rugby, cricket and football in the second half of 2021. For
One aspect that will fuel this trend, is Dubai’s ambition to be the media capital non-sports content including; news, talk shows, documentaries or other
of the region. Some Saudi media companies moving to Riyadh as part of non-scripted content, there are two approaches on how to linear stream. The
Program HQ, renewed innovation in the media sector out of Dubai is expected. current approach follows: for now, it has been either not to start, the smart tv
penetration in the region as it is still below 10%, people still channel flicking and
● Crypto & the token economy won’t take off (Yet) not app flicking, or we see how people go with an aggregator like Awaan.
CNN+ is the first big linear streaming service to launch in Q1 2022, it’s unknown
Not yet. It’s too early. While Crypto and NFT’s continue to rise in popularity, we if this will be available here as well. Ashaarq until now hasn’t launched TV OS’s
are nowhere near mass consumer participation. There is a lot more to come in streaming apps, but this would be expected as Alarabiya already has (same
the creator economy, and the start of Web 3.0; however the regulation, digital offering as on cable tv), and others will follow with ‘owned’ apps, partnerships
infrastructure isn’t there yet for tokens to take off. Expect another volatile year distribution strategy on OEM’s and MNO’s.
on crypto trading prices and a lot of failed projects alongside the successes.
What DMCC is doing in Dubai is great, as the City fast becomes a Crypto hub. ● Starzplay gets acquired
However, this isn’t the year yet, the groundswell will continue like we were
waiting for about 3 or 4 years for the year of mobile before Facebook went We haven’t seen much consolidation in streaming in MENA yet. This would be
mobile-first in 2012 / 2013 (the iPhone launched in 2007), it will take a few more interesting as after raising rounds, initially $125m then a subsequent $25m in
years until we are all crypto natives with mass penetration of wallets and venture debt last year, there aren’t that many options left, especially when
smart contracts. original content costs so much to compete, an exit of sorts is likely.
CEO & Chairman Exclusive:
12 Predictions For The MENA Media Industry In 2022

● A new app breaks through ● Anghami share price will increase significantly in 2022

IRL (In Real Life) app is looking promising. Two and a half years old and has Another huge moment in 2021, was Anghami’s SPAC listing on the Nasdaq,
recently surpassed 18 million monthly active users. IRL is backed by Softbank, expected to be complete in 2022. The share price/valuation hasn’t shifted
recently rated as a $1billion valuation, making it the only other media-like app much for VMAC (Vistas Media Acquisition Company) and all eyes will be
after Clubhouse to reach unicorn status. It’s a chat app but also billed as watching whether there is a bounce or a drop on the $220m or so valuation of
Facebook Groups and Events for Gen Z, ie those who don’t use Facebook. the company. The temperature for SPAC’s has cooled a lot for media
companies, and how the market receives Anghami might be a reflection or
● Short form video continues to explode that, optimistically it could also show a positive outlook of what investors think
of media tech companies in the region. While monetization remains a
TikTok’s start continues to rise, in this region they have beefed up their challenge, the gap in valuation between Anghami and Spotify, coupled with
headcount, hiring some of the top executives in the region. YouTube sees a big the large population in the region, and this being the first media/tech stock
opportunity with Shorts among Arab youth, running Citywide outdoor available to a US public market investors for the Arab region, leads me to
campaign’s in Cairo and sponsoring the Abu Dhabi Vido Con event last suspect the current share price of $10 will looking very cheap by the time 2023
November. comes around.

● A Podcast company will get acquired ● The FIFA 2022 Qatar World Cup will be a tipping point in regional
economies
The Arab world is waiting for its podcast moment. Last year saw SRMG acquire
Thamah in KSA. The market hasn’t been created yet, either at a consumer or The single biggest media event in the world bar none is taking place in the
commercial level. Spotify continues to set the pace globally, surpassing Apple Middle East for the first time in its almost 100 year history. A huge event on
for new shows hosted, and it would be expected for them to carry that every level, and especially for media, it will be an opportunity for all media,
strategy in this region. They could look at acquiring some of the podcast either directly or indirectly. The event will bring the worlds media to Qatar, it will
creators like Kerning Cultures, Finyal Media or Rising Giants Network, or go after galvanize the Arab media documenting the tournament, it is a platform for
an emerging platform like Podeo (Disclose I sit on the Podeo board as an local and national news outlets in the region, for the media for the Arab
investor). Audio will also expand into the home, expect Amazon to make a big Nations participating and for those that are not, in addition, it will also bring
push for their Echo devices, recently available in the market. with it increased advertising spend on all channels.
Financial Statements
CONSOLIDATED INCOME STATEMENT

FOR THE PERIOD ENDED 31 DECEMBER UNAUDITED AUDITED

2021 2020
GROSS REVENUE 5,700 2,710
NET REVENUE 3,640 1,965
BARTER 190 170
REVENUE TURNOVER 3,830 2,135
COST OF SALE 580 330
GROSS PROFIT 3,250 1,805
NET OPERATING EXPENSES 2,365 1,535
OPERATING (LOSS)/PROFIT 885 270
ITDA 120
EBITDA 1,005

OPERATIONAL Margin 27% 15%

Above Figures are rounded to the nearest thousands

Financial Statements
CONSOLIDATED BALANCE SHEET
31 DECEMBER 2021 31 DECEMBER 2020
ASSETS UNAUDITED AUDITED
NON-CURRENT 1,105 240
INTANGIBLE ASSETS 171 171
PROPERTY, PLANT & EQUIPMENT 934 69

CURRENT 2,938 1,243

TRADE & OTHER RECEIVABLE 2,247 643
PREPAID 142 78
CASH & CASH EQUIVALENT 524 522

TOTAL ASSETS 4,042 1,483

LIABILITIES
NON-CURRENT 255 76
LOANS & BORROWING 156 26
EOS 99 50

CURRENT 1018 254

TRADE & OTHER PAYABLES 791 237
LOANS & BORROWING 227 17

TOTAL LIABILITIES 1273 330

EQUITY
SHARE CAPITAL 162 33
RETAINED EARNINGS 2,606 1,120

TOTAL EQUITY 2,768 1,153

TOTAL LIABILITIES & EQUITY 4,042 1,483

Above Figures are rounded to the nearest thousands

APPENDIX