8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

Current Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934

Date of Report (Date Earliest Event reported) — February 21, 2013 (February 21, 2013)

MDC PARTNERS INC.

(Exact name of registrant as specified in its charter)

Canada	001-13718	98-0364441
(Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)

745 Fifth Avenue, 19^th Floor, New York, NY 10151
(Address of principal executive offices and zip code)

(646) 429-1800
(Registrant’s Telephone Number)

Check the appropriate box below if the Form 8−K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a−12 under the Exchange Act (17 CFR 240.14a−12)

¨ Pre−commencement communications pursuant to Rule 14d−2(b) under the Exchange Act (17 CFR 240.14d−2(b))

¨ Pre−commencement communications pursuant to Rule 13e−4(c) under the Exchange Act (17 CFR 240.13e− 4(c))

Item 2.02 Results of Operations and Financial Condition.

On February 21, 2013, the Company issued an earnings release reporting its financial results for the three and twelve months ended December 31, 2012. A copy of this earnings release is attached as Exhibit 99.1 hereto. Following the issuance of this earnings release, the Company hosted an earnings call in which its financial results for the three and twelve months ended December 31, 2012 were discussed. The investor presentation materials used for the call are attached as Exhibit 99.2 hereto.

The Company has posted the materials attached as Exhibit 99.2 on its web site (www.mdc-partners.com). The information found on, or otherwise accessible through, the Company’s website is not incorporated into, and does not form a part of, this Current Report on Form 8-K.

The foregoing information (including the exhibits hereto) is being furnished under “Item 2.02 - Results of Operations and Financial Condition.” Such information (including the exhibits hereto) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such filing.

The foregoing information and the exhibits hereto contain forward-looking statements within the meaning of the federal securities laws. These statements are based on present expectations, and are subject to the limitations listed therein and in the Company's other SEC reports, including that actual events or results may differ materially from those in the forward-looking statements.

Item 9.01. Financial Statements and Exhibits.

(d) Exhibits.

99.1 Press release dated February 21, 2013, relating to the Company’s earnings for the three and twelve months ended December 31, 2012.

99.2 Slideshow presentation dated February 21, 2013.

2

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed by the undersigned hereunto duly authorized.

Date: February 21, 2013	MDC Partners Inc.
	By:
		/s/ Mitchell Gendel
		Mitchell Gendel
		General Counsel & Corporate Secretary

3

EX-99.1

  

PRESS RELEASE

FOR RELEASE AT 4:01 PM (EST)

FOR:	MDC Partners Inc.	CONTACT:	David Doft
	745 Fifth Avenue, 19th Floor		Chief Financial Officer
	New York, NY 10151		646-429-1818
			ddoft@mdc-partners.com

MDC PARTNERS INC. REPORTS RECORD RESULTS FOR THE
THREE AND TWELVE MONTHS ENDED DECEMBER 31, 2012

FOURTH QUARTER HIGHLIGHTS:

· Material acceleration of financial performance across all metrics

· Revenue increased to $294.6 million versus $254.1 million in Q4 2011, an increase of 16.0%

· Organic revenue increased 11.9% for Q4 2012

· EBITDA increased to $43.6 million versus $26.3 million in Q4 2011, an increase of 66.1%

· EBITDA margin increased 450 basis points to 14.8% versus 10.3% in Q4 2011, reflecting an increase of 44%

· Free Cash Flow increased to $24.0 million versus $9.2 million in Q4 2011

· Net new business wins of $33.7 million for Q4 2012

FULL YEAR HIGHLIGHTS:

· Revenue increased to $1.07 billion versus $940.4 million in the twelve months ended December 31, 2011, an increase of 13.9%

· Organic revenue increased 8.4% for 2012 on top of a 16.6% organic revenue increase in 2011

· EBITDA increased to $118.4 million versus $93.1 million in the twelve months ended December 31, 2011, an increase of 27.2%

· EBITDA margin increased 120 basis points to 11.1% versus 9.9% in 2011

· Free Cash Flow improved to $49.6 million versus $25.0 million in the twelve months ended December 31, 2011, an increase of 98.4%

· Net new business wins of $136.9 million in the twelve months ended December 31, 2012, an increase of 31.5%

· Net debt-to-EBITDA reduced significantly from 4.0 times EBITDA to 3.0 times EBITDA, an improvement of 25%

NEW YORK, NY (February 21, 2013) – MDC Partners Inc. (“MDC Partners” or the “Company”) today announced financial results for the three and twelve months ended December 31, 2012.

Miles S. Nadal, Chairman and Chief Executive Officer of MDC Partners, said, “2012 was a record year for MDC Partners as we exceeded guidance and delivered exceptional revenue, EBITDA, free cash flow and EBITDA margin growth. Our organic revenue growth accelerated to 11.9% for the fourth quarter and 8.4% for 2012, far outpacing the industry and we materially improved our net debt-to-EBITDA leverage ratio, putting our balance sheet in a very strong position.

“It’s clear from our results that our strategy of creating a truly transformational business where the most talented people in the industry are dedicated to enhancing the sustainable profitable growth of their clients is working. We are winning incremental share of wallet and gaining market share. We have received exceptional industry recognition, including 2012 Agency of the Year for 72andSunny, Anomaly and kbs+ celebrated as two of only 10 ‘Standout Agencies,’ and TargetCast and Vitro both named ‘Agencies to Watch’. Looking ahead, we are even more excited about 2013. Our new business pipeline is at an all-time high and we are seeing larger opportunities across more agencies, and more disciplines. As a result, we have an outstanding foundation for continued accelerated financial performance in 2013 and in the years to come.”

Guidance for 2013 is established as follows:

			Implied
	2012	2013	Year over Year
	Actual	Guidance	Change
Revenue	$1,070.7 million	$1,125 - $1,150 million	+5.1% to +7.4%
EBITDA	$118.4 million	$132 - $135 million	+11.5% to +14.0%
Free Cash Flow	$49.6 million	$55 - $60 million	+10.8% to +20.9%
EBITDA Margin	11.1%	11.7%	+60 basis points

Consolidated revenue for the fourth quarter of 2012 was $294.6 million, an increase of 16.0% compared to $254.1 million in the fourth quarter of 2011. EBITDA (as defined) for the fourth quarter of 2012 was $43.6 million, an increase of 66.1% compared to $26.3 million in the fourth quarter of 2011, as the company realized 450 basis points of EBITDA margin expansion from its previous growth initiatives. Loss attributable to MDC Partners in the fourth quarter was ($24.5) million compared to a loss of ($57.7) million in the fourth quarter of 2011. Diluted loss per share from continuing operations attributable to MDC Partners common shareholders for the fourth quarter of 2012 was ($0.76) compared to ($1.93) per share in the same period of 2011. Free cash flow from operations (as defined) was $24.0 million in the fourth quarter of 2012, compared with $9.2 million in the fourth quarter of 2011.

For the twelve month period ended December 31, 2012, consolidated revenue was $1.07 billion, an increase of 13.9% compared to $940.4 million in the twelve months ended December 31, 2011. EBITDA for the twelve months ended December 31, 2012 increased 27.2% to $118.4 million compared to $93.1 million in the same period of 2011. Loss attributable to MDC Partners in the twelve months ended December 31, 2012 was ($85.4) million compared to a loss of ($84.7) million in 2011. Diluted loss per share from continuing operations attributable to MDC Partners common shareholders for the twelve months ended December 31, 2012 was ($2.60) compared to a loss of ($2.80) per share in the same period of 2011. Cash flows provided by continuing operating activities for the twelve months ended December 31, 2012 was $78.2 million compared to $7.2 million in the same period of 2011. Free cash flow from operations was $49.6 million in the twelve months ended December 31, 2012, compared with $25.0 million in the same period of 2011.

David Doft, CFO of MDC Partners, said, “Our disciplined approach to operating efficiency enabled us to increase EBITDA margins by 44% in the quarter to 14.8% and by 12% for the fiscal year to 11.1%. Our work to improve our balance sheet is paying off as our leverage was 3.0 times net debt-to-EBITDA at year end, well ahead of our long-term plan.  This is a 25% improvement over the 4.0 times we reported at year-end 2011.  The combination of our superior growth profile, scalability of our model, expected continued margin expansion, strong free cash flow generation, and efforts to optimize our balance sheet, we believe have positioned the company well for strong equity returns in the near and long-term.”

Conference Call

Management will host a conference call on Thursday, February 21, 2013 at 4:30 p.m. (EST) to discuss results. The conference call will be accessible by dialing 1-412-858-4600 or toll free 1-800-860-2442. An investor presentation has been posted on our website www.mdc-partners.com and will be referred to during the conference call.

A recording of the conference call will be available one hour after the call until 9:00 a.m. March 8, 2013, by dialing 1-412-317-0088 or toll free 1-877-344-7529 (passcode 10024176) or by visiting our website at www.mdc-partners.com.

About MDC Partners Inc.

MDC is a Business Transformation Organization that utilizes technology, marketing communications, data analytics and insights and strategic consulting solutions to drive meaningful returns on Marketing and Communications Investments for multinational clients in the United States, Canada, and worldwide.

MDC’s durable competitive advantage is to Empower the Most Talented Entrepreneurial Thought Leaders to Drive Business Success to new levels of Achievement, for both our Clients and our Shareholders, reinforcing MDC's reputation as "The Place Where Great Talent Lives."

MDC Partners' Class A shares are publicly traded on NASDAQ under the symbol "MDCA" and on the Toronto Stock Exchange under the symbol "MDZ.A".

Non-GAAP Financial Measures

In addition to its reported results, MDC Partners has included in this earnings release certain financial results that the Securities and Exchange Commission 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. These non-GAAP financial measures relate to: (1) presenting EBITDA and EBITDA margin (as defined) for the three and twelve months ended December 31, 2012 and 2011; and (2) presenting Total Free Cash Flow (as defined) and Free Cash Flow for the three and twelve months ended December 31, 2012 and 2011. Included in this earnings release are tables reconciling MDC’s reported results to arrive at these non-GAAP financial measures. In addition, Net Debt is defined in our credit facility as debt due pertaining to the revolving credit facility plus debt pertaining to the Senior Notes less total cash and cash equivalents.

This press release contains forward-looking statements. The Company’s representatives may also make forward-looking statements orally from time to time. Statements in this press release that are not historical facts, including statements about the Company’s beliefs and expectations, earnings guidance, recent business and economic trends, potential acquisitions, estimates of amounts for deferred acquisition consideration and “put” option rights, constitute forward-looking statements. These 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. 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 severe effects of international, national and regional economic downturn;

· the Company’s ability to attract new clients and retain existing clients;

· the spending patterns and financial success of the Company’s clients;

· the Company’s ability to retain and attract key employees;

· 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 “put” option right and deferred acquisition consideration;

· the successful completion and integration of acquisitions which complement and expand the Company’s business capabilities; and

· foreign currency fluctuations.

The Company’s business strategy includes ongoing efforts to engage in material acquisitions of ownership interests in entities in the marketing communications services industry. The Company intends to finance these acquisitions by using available cash from operations, from borrowings under its credit facility and through incurrence of bridge or other debt financing, any of which may increase the Company’s leverage ratios, or by issuing equity, which may have a dilutive impact on existing shareholders proportionate ownership. At any given time the Company may be engaged in a number of discussions that may result in one or more material acquisitions. These opportunities require confidentiality and may involve negotiations that require quick responses by the Company. Although there is uncertainty that any of these discussions will result in definitive agreements or the completion of any transactions, the announcement of any such transaction may lead to increased volatility in the trading price of the Company’s securities.

Investors should carefully consider these risk factors and the additional risk factors outlined in more detail in the Annual Report on Form 10-K under the caption “Risk Factors” and in the Company’s other SEC filings.

SCHEDULE 1

MDC PARTNERS INC.

CONSOLIDATED STATEMENTS OF OPERATIONS

(US$ in 000s, except share and per share amounts)

	Three Months Ended December 31,						Year Ended December 31,
	2012			2011			2012			2011
Revenue	$	294,648		$	254,068		$	1,070,711		$	940,403
Operating Expenses:
Cost of services sold		195,156			180,862			739,121			669,990
Office and general expenses		96,229			66,436			303,084			218,514
Depreciation and amortization		10,370			10,576			46,414			40,220
		301,755			257,874			1,088,619			928,724
Operating profit (loss)		(7,107	)		(3,806	)		(17,908	)		11,679
Other Income (Expenses):
Other income (expense), net		383			789			(859	)		(1,561	)
Interest expense		(12,151	)		(10,892	)		(46,571	)		(41,922	)
Interest income		76			54			259			206
Loss from continuing operations before income taxes and equity in affiliates		(18,799	)		(13,855	)		(65,079	)		(31,598	)
Income tax expense (recovery)		3,539			40,831			9,553			41,735
Loss from continuing operations before equity in affiliates		(22,338	)		(54,686	)		(74,632	)		(73,333	)
Equity in earnings (loss) of non-consolidated affiliates		234			(1	)		633			213
Loss from continuing operations		(22,104	)		(54,687	)		(73,999	)		(73,120	)
Loss from discontinued operations, net of taxes		(860	)		(1,203	)		(5,428	)		(3,167	)
Net loss		(22,964	)		(55,890	)		(79,427	)		(76,287	)
Net income attributable to the noncontrolling interests		(1,584	)		(1,850	)		(6,012	)		(8,387	)
Net loss attributable to MDC Partners Inc.	$	(24,548	)	$	(57,740	)	$	(85,439	)	$	(84,674	)
Loss Per Common Share:
Basic and Diluted:
Loss from continuing operations attributable to MDC
Partners Inc. common shareholders	$	(0.76	)	$	(1.93	)	$	(2.60	)	$	(2.80	)
Discontinued operations attributable to MDC
Partners Inc. common shareholders	$	(0.03	)	$	(0.04	)	$	(0.18	)	$	(0.11	)
Loss attributable to MDC Partners Inc.
common shareholders	$	(0.79	)	$	(1.97	)	$	(2.78	)	$	(2.91	)
Weighted Average Number of Common Shares:
Basic and Diluted		31,086,033			29,258,049			30,726,773			29,120,373

SCHEDULE 2

MDC PARTNERS INC.

RECONCILIATION OF OPERATING INCOME (LOSS) TO EBITDA

(US$ in 000s, except percentages)

For the Three Months Ended December 31, 2012                

	Strategic			Performance
	Marketing			Marketing
	Services			Services			Corporate			Total
Revenue	$	200,710		$	93,938			-		$	294,648
Operating income (loss) as reported	$	667		$	212		$	(7,986	)	$	(7,107	)
margin		0.3	%		0.2	%					(2.4	)%
Add:
Depreciation and amortization		5,717			4,318			335			10,370
Stock-based compensation		2,584			2,640			603			5,827
Acquisition deal costs		88			34			761			883
Deferred acquisition consideration adjustments to P&L		29,882			3,019			-			32,901
Profit distributions from affiliates		-			-			746			746
EBITDA *	$	38,938		$	10,223		$	(5,541	)	$	43,620
margin		19.4	%		10.9	%					14.8	%

* EBITDA is a non-GAAP measure, but as shown above it represents operating income (loss) plus depreciation and amortization,      

* stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates.

MDC PARTNERS INC.

RECONCILIATION OF OPERATING INCOME (LOSS) TO EBITDA

(US$ in 000s, except percentages)

For the Three Months Ended December 31, 2011                

	Strategic			Performance
	Marketing			Marketing
	Services			Services			Corporate			Total
Revenue	$	165,442		$	88,626			-		$	254,068
Operating income (loss) as reported	$	(8,336	)	$	13,744		$	(9,214	)		(3,806	)
margin		(5.0	)%		15.5	%					(1.5	)%
Add:
Depreciation and amortization		6,036			4,160			380			10,576
Stock-based compensation		1,253			1,104			3,480			5,837
Acquisition deal costs		660			190			531			1,381
Deferred acquisition consideration adjustments to P&L		19,990			(8,233	)		-			11,757
Profit distributions from affiliates		-			-			517			517
EBITDA*	$	19,603		$	10,965		$	(4,306	)	$	26,262
margin		11.8	%		12.4	%					10.3	%

* EBITDA is a non-GAAP measure, but as shown above it represents operating income (loss) plus depreciation and amortization,      

* stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates.

SCHEDULE 3

MDC PARTNERS INC.

RECONCILIATION OF OPERATING INCOME (LOSS) TO EBITDA

(US$ in 000s, except percentages)

For the Year Ended December 31, 2012

	Strategic			Performance
	Marketing			Marketing
	Services			Services			Corporate			Total
Revenue	$	721,228		$	349,483			-		$	1,070,711
Operating income (loss) as reported	$	22,711		$	(430	)	$	(40,189	)	$	(17,908	)
margin		3.1	%		(0.1	)%					(1.7	)%
Add:
Depreciation and amortization		27,455			17,617			1,342			46,414
Stock-based compensation		9,186			8,227			14,784			32,197
Acquisition deal costs		951			482			1,931			3,364
Deferred acquisition consideration adjustments to P&L		47,702			5,325			-			53,027
Profit distributions from affiliates		-			-			1,288			1,288
EBITDA *	$	108,005		$	31,221		$	(20,844	)	$	118,382
margin		15.0	%		8.9	%					11.1	%

* EBITDA is a non-GAAP measure, but as shown above it represents operating income (loss) plus depreciation and amortization,      

* stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates.  

MDC PARTNERS INC.

RECONCILIATION OF OPERATING INCOME (LOSS) TO EBITDA

(US$ in 000s, except percentages)

For the Year Ended December 31, 2011                

	Strategic			Performance
	Marketing			Marketing
	Services			Services			Corporate			Total
Revenue	$	608,022		$	332,381			-		$	940,403
Operating income (loss) as reported	$	22,504		$	25,433		$	(36,258	)	$	11,679
margin		3.7	%		7.7	%					1.2	%
Add:
Depreciation and amortization		22,378			17,016			826			40,220
Stock-based compensation		5,149			3,695			14,813			23,657
Acquisition deal costs		1,111			825			1,883			3,819
Deferred acquisition consideration adjustments to P&L		23,418			(10,795	)		-			12,623
Profit distributions from affiliates		-			-			1,065			1,065
EBITDA*	$	74,560		$	36,174		($	17,671	)	$	93,063
margin		12.3	%		10.9	%					9.9	%

* EBITDA is a non-GAAP measure, but as shown above it represents operating income (loss) plus depreciation and amortization,      

* stock-based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates.

SCHEDULE 4

MDC PARTNERS INC.

FREE CASH FLOW

(US$ in 000s)

	Three Months Ended December 31,						For the Year Ended December 31,
	2012			2011			2012			2011
Cash Flows Provided by Continuing Operating Activities	$	60,104		$	11,000		$	78,223		$	7,230
Distributions		746			517			1,288			1,065
Cash Taxes		317			76			1,236			240
Cash Interest, net		20,185			19,897			40,835			37,291
Changes in Working Capital		(36,855	)		(449	)		(17,350	)		37,898
Changes in Non-Current Assets & Liabilities		9,064			2,842			7,954			1,961
Other		(11,525	)		(9,471	)		184			(1,009	)
Net Income Attributable to the Noncontrolling Interests		1,584			1,850			6,012			8,387
EBITDA	$	43,620		$	26,262		$	118,382		$	93,063
Net Income Attributable to Noncontrolling Interests		(1,584	)		(1,850	)		(6,012	)		(8,387	)
Capital Expenditures, net (1)		(5,553	)		(4,943	)		(19,232	)		(21,111	)
Cash Taxes		(317	)		(76	)		(1,236	)		(240	)
Cash Interest, net & Other (2)		(12,118	)		(10,158	)		(42,256	)		(38,300	)
Free Cash Flow (3)	$	24,048		$	9,235		$	49,646		$	25,025
Cash Acquired from Acquisitons		-			14,893			54,624			14,893
Total Free Cash Flow (3)	$	24,048		$	24,128		$	104,270		$	39,918

(1) Capital Expenditures, net represents capital expenditures net of landlord reimbursements.

(2) Cash Interest, net & Other represents the quarterly accrual of cash interest under our Senior Notes.      

(3) Free Cash Flow and Total Free Cash Flow are non-GAAP measures. As shown above, Free Cash Flow represents EBITDA less net income attributable to noncontrolling interests, less capital expenditures, less cash taxes, less net cash interest (including interest paid and other).

SCHEDULE 5

MDC PARTNERS INC.

CONSOLIDATED BALANCE SHEETS

(US$ in 000s)

	December 31,
	2012			2011
Assets
Current Assets:
Cash and cash equivalents	$	60,330		$	8,096
Accounts receivable, net		326,087			238,592
Expenditures billable to clients		58,842			39,067
Other current assets		16,892			12,657
Total Current Assets		462,151			298,412
Fixed assets, net		52,914			47,737
Investment in affiliates		-			99
Goodwill		720,071			605,244
Other intangible assets, net		63,243			57,980
Deferred tax assets		9,332			15,380
Other assets		37,234			30,893
Total Assets	$	1,344,945		$	1,055,745
Liabilities and Shareholders' Deficit
Current Liabilities:
Accounts payable	$	356,847		$	178,282
Accrued and other liabilities		93,895			72,930
Advance billings		131,908			122,021
Current portion of long term debt		1,858			1,238
Current portion of deferred acquisition consideration		104,325			51,829
Total Current Liabilities		688,833			426,300
Long-term debt		429,845			383,936
Long-term portion of deferred acquisition consideration		92,121			85,394
Other liabilities		47,985			14,900
Deferred tax liabilities		53,018			50,724
Total Liabilities		1,311,802			961,254
Redeemable Noncontrolling Interests		117,953			107,432
Shareholders' Deficit
Common shares		253,870			228,209
Shares to be issued		424			424
Charges in excess of capital		(72,913	)		(45,102	)
Accumulated deficit		(316,713	)		(231,274	)
Stock subscription receivable		(55	)		(55	)
Accumulated other comprehensive loss		(7,445	)		(4,658	)
MDC Partners Inc. Shareholders' Deficit		(142,832	)		(52,456	)
Noncontrolling Interests		58,022			39,515
Total Deficit		(84,810	)		(12,941	)
Total Liabilities, Redeemable Noncontrolling
Interests and Deficit	$	1,344,945		$	1,055,745

SCHEDULE 6

MDC PARTNERS INC.

SUMMARY CASH FLOW DATA

(US$ in 000s)

	Year Ended December 31,
	2012			2011
Cash flows provided by continuing operating activities	$	78,223		$	7,230
Discontinued operations		(1,919	)		(2,682	)
Net cash provided by operating activities		76,304			4,548
Net cash provided by (used in) continuing investing activities		7,830			(29,774	)
Discontinued operations		(19	)		(662	)
Net cash provided by (used in) investing activities		7,811			(30,436	)
Net cash provided by (used in) continuing financing activities		(31,858	)		23,299
Effect of exchange rate changes on cash and cash equivalents		(23	)		(264	)
Net increase (decrease) in cash and cash equivalents	$	52,234		$	(2,853	)

EX-99.2

Management Presentation February 21, 2013 Fourth Quarter and Full Year Results

This presentation, including our “ 2013 Financial Outlook”, contains forward - looking statements . The Company’s representatives may also make forward - looking statements orally from time to time . Statements in this presentation that are not historical facts, including statements about the Company’s beliefs and expectations, earnings guidance, recent business and economic trends, potential acquisitions, estimates of amounts for deferred acquisition consideration and “put” option rights, constitute forward - looking statements . These 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 . 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 severe effects of international, national and regional economic downturn ; • the Company’s ability to attract new clients and retain existing clients; • the spending patterns and financial success of the Company’s clients; • the Company’s ability to remain in compliance with its debt agreements and the Company’s ability to finance its contingent pa yme nt obligations when due and payable, including but not limited to those relating to “put” option rights and deferred acquisition consideration; • the successful completion and integration of acquisitions which compliment and expand the Company’s business capabilities; an d • foreign currency fluctuations. The Company’s business strategy includes ongoing efforts to engage in material acquisitions of ownership interests in entities in the marketing communications services industry . The Company intends to finance these acquisitions by using available cash from operations and through incurrence of bridge or other debt financing, either of which may increase the Company’s leverage ratios, or by issuing equity, which may have a dilutive impact on existing shareholders proportionate ownership . At any given time the Company may be engaged in a number of discussions that may result in one or more material acquisitions . These opportunities require confidentiality and may involve negotiations that require quick responses by the Company . Although there is uncertainty that any of these discussions will result in definitive agreements or the completion of any transactions, the announcement of any such transaction may lead to increased volatility in the trading price of the Company’s securities . Investors should carefully consider these risk factors and the additional risk factors outlined in more detail in the Annual Report on Form 10 - K under the caption “Risk Factors” and in the Company’s other SEC filings . FORWARD LOOKING STATEMENTS & OTHER INFORMATION

SUMMARY • 2012 was a record year for MDC • Our strategy of creating a truly transformational business where the most talented people in the industry are dedicated to enhancing the sustainable profitable growth of their clients is working • We are winning incremental share of wallet and market share as our clients see the strong business results and trust more of their marketing and growth efforts to us • We have received exceptional industry recognition, including 2012 Agency of the Year for 72andSunny, Anomaly and kbs + were celebrated as two of only 10 ‘Standout Agencies,’ and TargetCast and Vitro were both named ‘Agencies to Watch’ • Our new business pipeline is at an all - time high • We are seeing larger opportunities across more agencies, and more disciplines as we continue to build our capabilities to help our clients drive profitable growth • As a result, we have an outstanding foundation for continued accelerated financial performance in 2013 and in the years to come •

Key Financial Highlights Material Acceleration of Financial Performance Across All Metrics: Revenue, EBITDA, EBITDA Margins, Free Cash Flow & Net Debt - to - EBITDA Ratio • Organic revenue growth of 11.9% for Q4 2012 and 8.4% for FY 2012 • Q4 2012 revenue increased 16.0% to $294.6 million • FY 2012 revenue increased 13.9% to $1.07 billion • Q4 2012 EBITDA increased 66.1% to $43.6 million • FY 2012 EBITDA increased 27.2% to $118.4 million • EBITDA margin expanded 450 basis points year over year to 14.8% in Q4 2012 • EBITDA margin expanded 120 basis points year over year to 11.1% for FY 2012 • Net new business wins of $33.7 million in Q4 2012, culminating in a total of $136.9 million for FY 2012 • Free Cash Flow increased 98.4% to $49.6 million for FY 2012 • Achieved goal of net debt - to - EBITDA ratio of 3.0x

Strong 2012 Results Across All Metrics Implied Actual 2012 Year over Year 2012 Year over Year Guidance Change Actual Change Revenue $1,050 - $1,075 million +11.3% to +14.0% $1,070.7 million +13.9% EBITDA $110 - $115 million +21.2% to +26.7% $118.4 million +27.2% Free Cash Flow $35 - $40 million +50.8% to +72.3% $49.6 million +98.4% + Cash Acquired from Acquisitions +$25 million +$54.6 million Total Free Cash Flow $60 - $65 million +10.6% to +19.8% $104.3 million +161.2% Implied EBITDA Margin 10.5% - 10.7% +90 to +110 basis points 11.1% +120 basis points Note: See appendix for definitions of non-GAAP measures Note: Actuals may not foot due to rounding

CONSOLIDATED REVENUE AND EARNINGS Note: Actuals may not foot due to rounding (US$ in millions, except percentages) 2012 2011 2012 2011 Revenue 294.6$ 254.1$ 16.0 % 1,070.7$ 940.4$ 13.9 % Operating Expenses Cost of services sold 195.2 180.9 7.9 % 739.1 670.0 10.3 % Office and general expenses 96.3 66.4 45.0 % 303.1 218.5 38.7 % Depreciation and amortization 10.4 10.6 (1.9) % 46.4 40.2 15.4 % Operating profit (loss) (7.1) (3.8) (17.9) 11.7 Other income (expense), net (11.7) (10.0) (47.2) (43.3) Income tax expense 3.5 40.8 9.6 41.7 Equity in earnings of non-consolidated affiliates 0.2 (0.0) 0.6 0.2 Loss from Continuing Operations (22.1) (54.7) (74.0) (73.1) Loss from discontinued operations, net of taxes 0.9 (1.2) (5.4) (3.2) Net loss (23.0) (55.9) (79.4) (76.3) Net income attributable to the non- controlling interests (1.6) (1.9) (6.0) (8.4) Net loss attributable to MDC Partners Inc. (24.5)$ (57.7)$ (85.4)$ (84.7)$ % Change Three Months Ended December 31, Twelve Months Ended December 31, % Change

SUMMARY OF SEGMENT RESULTS - REVENUE • Strategic Marketing Services delivered 17.6% organic growth, an acceleration of 510 basis points from 3 Q 2012 • Strong new business wins in 2012 led to significant market share gains (US$ in millions, except percentages) 2012 2011 2012 2011 Revenue Strategic Marketing Services 200.7$ 165.4$ 21.3 % 721.2$ 608.0$ 18.6 % Performance Marketing Services 93.9 88.6 6.0 % 349.5 332.4 5.1 % Total Revenue 294.6$ 254.1$ 16.0 % 1,070.7$ 940.4$ 13.9 % % Change Three Months Ended December 31, Twelve Months Ended December 31, % Change Note: Actuals may not foot due to rounding

FOURTH QUARTER 2012 REVENUE GROWTH BY SEGMENT Strategic Performance Weighted Marketing Marketing Average Services Services Total Organic Growth 17.6% 1.2% 11.9% Acquisition Growth 3.3% 4.2% 3.6% Foreign Exchange Growth 0.4% 0.6% 0.5% Total 21.3% 6.0% 16.0%

FULL YEAR 2012 REVENUE GROWTH BY SEGMENT Strategic Performance Weighted Marketing Marketing Average Services Services Total Organic Growth 12.5% 0.7% 8.4% Acquisition Growth 6.4% 4.7% 5.8% Foreign Exchange Growth -0.3% -0.3% -0.3% Total 18.6% 5.1% 13.9%

Retail 18% Other 12% Auto 6% Technology 8% Consumer Products 32% Healthcare 5% Financials 8% Communications 11% Retail 12% Other 13% Auto 4% Technology 4% Consumer Products 39% Healthcare 4% Financials 10% Communications 14% FOURTH QUARTER REVENUE BY CLIENT SECTOR Note: Actuals may not foot due to rounding Q4 2012 Q4 2011 • Our Business Continues to Strengthen in Diversification Across Sectors As More Clients Turn To Us To Deliver Transformational Business Results for Them • We Continue To Expand Our Portfolio of Services and Our Industry Capabilities

Retail 14% Other 12% Auto 4% Technology 8% Consumer Products 35% Healthcare 4% Financials 10% Communications 13% Retail 17% Other 12% Auto 6% Technology 9% Consumer Products 31% Healthcare 5% Financials 8% Communications 12% FULL YEAR REVENUE BY CLIENT SECTOR Note: Actuals may not foot due to rounding FY 2012 FY 2011

-10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% 25.0% MDC Partners vs. Peers Trailing 12 Month Organic Revenue MDC Peers Outperformance Despite More Difficult Comparisons Note: *Peers include Omnicom, Havas , and Publicis *Due to timing of earnings WPP and Interpublic are not included in 4 Q12 ORGANIC GROWTH 4 Q12 +11.9%

SUMMARY OF SEGMENT RESULTS - EBITDA Note: Actuals may not foot due to rounding (US$ in millions, except percentages) 2012 2011 2012 2011 EBITDA Strategic Marketing Services 38.9$ 19.6$ 98.6 % 108.0$ 74.6$ 44.9 % margin 19.4% 11.8% 15.0% 12.3% Performance Marketing Services 10.2 11.0 (6.8) % 31.2 36.2 (13.7) % margin 10.9% 12.4% 8.9% 10.9% Marketing Communications 49.2 30.6 60.8 % 139.2 110.7 25.7 % margin 16.7% 12.0% 13.0% 11.8% Corporate Expenses (6.3) (4.8) 30.4 % (22.1) (18.7) 18.1 % Profit Distributions from Affiliates 0.7 0.5 1.3 1.1 Total EBITDA 43.6$ 26.3$ 66.1 % 118.4$ 93.1$ 27.2 % margin 14.8% 10.3% 11.1% 9.9% % Change Three Months Ended December 31, Twelve Months Ended December 31, % Change • Our Focus on Building Operational Strength Across the Portfolio Has Resulted in Strong Total Margin Increases

FREE CASH FLOW Note: Actuals may not foot due to rounding (US$ in millions) 2012 2011 2012 2011 Cash Flow Provided by Continuing Operating Activities $60.1 $11.0 $78.2 $7.2 Distributions 0.7 0.5 1.3 1.1 Cash Taxes 0.3 0.1 1.2 0.2 Cash Interest, net 20.2 19.9 40.8 37.3 Changes in Working Capital (36.9) (0.4) (17.4) 37.9 Changes in Non-Current Assets & Liabilities 9.1 2.8 8.0 2.0 Other (11.5) (9.5) 0.2 (1.0) Net Income Attributable to Noncontrolling Interests 1.6 1.9 6.0 8.4 EBITDA $43.6 $26.3 $118.4 $93.1 Net Income Attibutable to Noncontrolling Interests (1.6) (1.9) (6.0) (8.4) Capital Expenditures, net (1) (5.6) (4.9) (19.2) (21.1) Cash Taxes (0.3) (0.1) (1.2) (0.2) Cash Interest, net & Other (2) (12.1) (10.2) (42.3) (38.3) Free Cash Flow (3) $24.0 $9.2 $49.6 $25.0 Cash Acquired from Acquisitions 0.0 14.9 54.6 14.9 Total Free Cash Flow (3) $24.0 $24.1 $104.3 $39.9 (3) Free Cash Flow and Total Free Cash Flow are non-GAAP measures. As shown above, Free Cash Flow represents EBITDA less net income attributable to noncontrolling interests, less capital expenditures, less cash taxes, less net cash interest (including interest paid and other). Three Months Ended December 31, Twelve Months Ended December 31, (1) Capital Expenditures, net represents capital expenditures net of landlord reimbursements. (2) Cash Interest, net & Other represents the quarterly accrual of cash interest under our Senior Notes.

LIQUIDITY *Note: At December 31, 2012, after giving effect to the limitations under the 11% Senior Notes indenture, approximately $85.0 million was available under the bank credit facility. (US$ in millions) Commitment Under Facility 150.0$ Drawn - Undrawn Letters of Credit 4.8 Funds Available Under Facility 145.2$ Total Cash 60.3 Liquidity 205.5$ Available Liquidity at December 31, 2012*

2013 FINANCIAL OUTLOOK Implied 2013 Year over Year Guidance Change Revenue $1,125 - $1,150 million +5.1% to +7.4% EBITDA $132 - $135 million +11.5% to +14.0% Free Cash Flow $55 - $60 million +10.8% to +20.9% Implied EBITDA Margin 11.7% +60 basis points Note: See appendix for definitions of non-GAAP measures • We Look For Continued Revenue Strength in 2013, Along With Continued Operational Excellence And Resulting Margin Increases

APPENDIX

TEMPORAL PUT OBLIGATIONS AND IMPACT ON EBITDA Note: Excludes put rights of $102.1 million exercisable pursuant to termination of employment or death. Incremental (US$ in millions) Cash Stock Total EBITDA in Period 2013 1.5 0.3 1.8 1.5 2014 1.4 0.5 1.9 0.2 2015 3.7 0.5 4.2 1.7 2016 2.6 0.1 2.7 0.0 Thereafter 5.3 0.0 5.3 0.6 Total $14.5 $1.4 $15.9 $4.0 Effective Multiple 4.0 Estimated Put Impact at December 31, 2012 Payment Consideration

SUMMARY OF CASH FLOW Note: Actuals may not foot due to rounding (US$ in millions) 2012 2011 Cash flows provided by (used in) continuing operating activities $78.2 $7.2 Discontinued operations (1.9) (2.7) Net cash provided by operating activities $76.3 $4.5 Cash flows provided by (used in) continuing investing activities $7.8 ($29.8) Discontinued operations (0.0) (0.7) Net cash provided by (used in) investing activities $7.8 ($30.4) Net cash provided by (used in) financing activities ($31.9) $23.3 Effect of exchange rate changes on cash and cash equivalents ($0.0) ($0.3) Net increase (decrease) in cash and cash equivalents $52.2 ($2.9) Twelve Months Ended December 31,

DEFINITION OF NON - GAAP MEASURES • EBITDA: EBITDA is a non - GAAP measure, that represents operating profit plus depreciation and amortization, stock - based compensation, acquisition deal costs, deferred acquisition consideration adjustments and profit distributions from affiliates . • Organic Growth: Organic revenue growth is a non - GAAP measure that refers to growth in revenues from sources other than acquisitions or foreign exchange impacts. • Free Cash Flow: Free cash flow is a non - GAAP measure that represents EBITDA less net income attributable to noncontrolling interests, less capital expenditures net of landlord reimbursements, less net cash interest (including interest paid and to be paid on the 11% Senior Notes), less cash taxes plus realized cash foreign exchange gains. • Total Free Cash Flow: Total free cash flow is a non - GAAP measure that represents free cash flow plus changes in working capital plus other changes in cash. • Net Bank Debt or Net Debt: Debt due pertaining to the revolving credit facility plus debt pertaining to the Senior Notes less total cash and cash equivalents. Note: A reconciliation of Non - GAAP to US GAAP reported results has been provided by the Company in the tables included in the earnings release issued on February 21, 2013.