Slide 1: Q4 2022 Presentation of the year-end report & strategic update
Q4 2022 Presentation of the year-end report & strategic update Hemnet Group AB ⎸ 27 January 2023 1 Hemnet Group AB (publ) ｜Mäster Samuelsgatan 42 ｜111 57｜Stockholm｜Sweden
Slide 2: Present today
Present today Cecilia Beck-Friis Jens Melin Francesca Cortesi Nick Lundvall Chief Executive Officer Interim Chief Financial Officer Chief Product Officer IR Manager & Head of Corporate Development 2
Slide 3: Agenda
Agenda 10:00 CET START Year-end report 2022 Q4 highlights Strategy and 2023 product roadmap Financial targets Q&A Submit your questions via the webcast: https://ir.financialhearings.com/hemnet-q4-2022 11:00 CET END 3
Slide 4: Year-end report 2022
Year-end report 2022 Cecilia Beck-Friis, CEO 4
Slide 5: 2022 Year-end summary
2022 Year-end summary Key financials Highlights Net sales growth ● All financial targets exceed for the full year +22.1% ● Revenue from property sellers up 32.6% as more sellers chose to upgrade their listing, (SEK 889.2m) despite listing volumes in line with LY “Net sales growing 22.1% Adj. EBITDA-ma
Slide 6: Consistent top-line growth with high operating leverage with results exceeding financial targets
Consistent top-line growth with high operating leverage with results exceeding financial targets Net sales growth Adj. EBITDA growth ARPL growth +23% 5-year CAGR +33% +28% 5-year CAGR (5-year CAGR) (5-year CAGR) (5-year CAGR) Target: Hemnet aims to achieve annual net sales Target: Hemnet aims to ach
Slide 7: We have enriched our offering in line with our strategy to increase consumer value
We have enriched our offering in line with our strategy to increase consumer value Enriching consumers experience of the marketplace Register your Search for an Sell your Recommend- Create an property agent/agency property ations account Follow the value One of Sweden’s Increase value of Drive Incre
Slide 8: Continued focus on Hemnet products that connect agents and sellers - a SEK 1bn market
Continued focus on Hemnet products that connect agents and sellers - a SEK 1bn market We work with both new and existing agent products to invest in future revenue growth NEW: Agent profile ● One of the largest in Sweden, only months after launch Agent ● Added agency search improved office profiles
Slide 9: 2022 ARPL up 33% despite challenging market, driven by strong demand for Plus and Premium
2022 ARPL up 33% despite challenging market, driven by strong demand for Plus and Premium Total ARPL ARPL from Plus & Premium ● Steady conversion and ARPL growth SEK, annual SEK, quarterly since launch of packages ● Hemnet Premium performing above expectations ● We optimise for ARPL growth over conv
Slide 10: A key ARPL driver is adding the number of price points for each product
A key ARPL driver is adding the number of price points for each product Illustrative example Year 4 Year 3 Year 2 Year 1 Bas Plus Premium Broadening the price range “Driver” 10
Slide 11: Despite current market uncertainty, the Swedish housing market has historically been stable
Despite current market uncertainty, the Swedish housing market has historically been stable Published listings (Country, 12 month moving sum - including trendline) +1% Annual average growth 11 Source: Hemnet data
Slide 12: Strong organic demand for housing means sellers and buyers will eventually have to transact
Strong organic demand for housing means sellers and buyers will eventually have to transact Majority of real estate agents expect 2/3 Buyers and sellers will eventually have to transact regardless of the market 72% that the property market will turn within 12 months To buyers and sellers: how long c
Slide 13: The housing market has historically followed a predictable pattern
The housing market has historically followed a predictable pattern Illustrative analysis based on past data Housing Listing Phase prices volumes Increased uncertainty for the future of the market causes 1 prices to decrease. Sellers rush to close their deals Forced sellers (that have bought a new ho
Slide 14: A total of SEK 506 million will be returned to shareholders by the next AGM
A total of SEK 506 million will be returned to shareholders by the next AGM Capital return summary Total program size SEK 450m Buybacks to date SEK 330m Remaining planned buybacks SEK 120m Total issued shares 101.1m Total shares bought back for redemption 2.3m Total shares outstanding post redemptio
Slide 15: Q4 Highlights
Q4 Highlights Cecilia Beck-Friis, CEO 15
Slide 16: Net sales by customer category
Net sales by customer category Product Result Growth Key drivers Property ● Strong ARPL driven growth despite a drop in listing sellers +21% volumes Real estate ● Continued investments into marketing and seller agents +9% contacts, despite challenging housing market ● Demand for new development is e
Slide 17: Q4 ARPL growth of 34% partially offsets decline in listing volumes
Q4 ARPL growth of 34% partially offsets decline in listing volumes Q/Q growth +41% +34% +29% +34% ARPL growth driven by increasing demand (most recent) and pricing ● Product: Inclusion of renewal in Premium yielding results. Other improvements planned ● Upgrades: More and more consumers select a lar
Slide 18: Volumes in Q4 down 10%, resulting in annual listing volumes in line with last year
Volumes in Q4 down 10%, resulting in annual listing listing volumes in line with last year Q4 listings down 10% year on year… …but full year volumes on par with 2021 Published listings Published listings Annual volumes (Paid published listings, year-on-year change) (Paid published listings on Hemnet
Slide 19: 5% growth in Adj. EBITDA as we continue investing in the business during quarter with lowest activity
5% growth in Adj. EBITDA as we continue investing in the business during quarter with lowest activity ● Administration and commission expenses to real estate agents increased 13.8% in line with increasing revenue from listing related services ● Other external expenses increased by 33.9% to SEK 32.8m
Slide 20: In Q4 we reviewed our investment pace and priorities for the following year
In Q4 we reviewed our investment pace and priorities for the following year due to the market development External marketing and media Talent investments Cost smart investments ● All recruitments except business ● Marketing campaign and media critical postponed ● An overall mindful cost approach inv
Slide 21: An award winning workplace where colleagues thrive
An award winning workplace where colleagues thrive Hemnet has been awarded the AllBright prize Hemnet is recognised as one of Sweden’s given to public companies with a clear agenda best employers by Universum, coming in third for diversity, inclusion and gender equality. place amongst middle-sized c
Slide 22: We continue to take important steps within ESG, and have joined the Science Based Target initiative
We continue to take important steps within ESG, and have joined the Science Based Target initiative ● In October 2022, Hemnet filed an application for the Science Based Targets initiative (“SBTi”) and committed to the initiative’s near-term science-based emissions reduction target for small and medi
Slide 23: Chair and CFO roles have been filled for 2023
Chair and CFO roles have been filled for 2023 Anders Nilsson Previous assignments: Nominated Chair of the Board ● The Nomination Committee of Hemnet has unanimously decided to propose the AGM on 27 April 2023 to elect Anders Nilsson as new Chair of the Board of Directors of Hemnet. Anders Örnulf Pre
Slide 24: Strategy and 2023 Product roadmap
Strategy and 2023 Product roadmap Cecilia Beck-Friis, CEO Francesca Cortesi, CPO 24
Slide 25: Hemnet is Sweden's #1 destination for housing
Hemnet is Sweden’s #1 destination for housing 1. 1 2. 2 3. 3 4. 4 5. 5 0:30 c. 90% # 5 30 min 19x Share of sold Strongest media Time that each More clicks on properties listed on brand image in Swede spends on listings than #2 Hemnet Sweden Hemnet monthly portal Source: Hemnet, SCB (2021) Source: Yo
Slide 26: Our vision is to be the key to your property journey
Our vision is to be… The key to your property journey. We increase efficiency, transparency and mobility on the housing market By becoming… The destination for all things related to homes 26
Slide 27: A growth journey from an industry initiative to the destination for all things related to homes
A growth journey from an industry initiative to the destination for all things related to homes Horizon 3 Horizon 2 The destination for all things related to Horizon 1 homes Expand along the Horizon 0 property journey beyond buy and sell Enhance and commercialize the listing portal - core Industry 2
Slide 28: Our future growth is supported by a three-year strategy, consisting of three pillars
Our future growth is supported by a three-year strategy, consisting of three pillars Engage consumers Grow sellers Transform B2B Increase engagement and Optimize seller revenues Broaden our portfolio and shift strengthen loyalty across the through a balance of product, growth to Hemnet–unique proper
Slide 29: Executing on the strategy: 2023 Product roadmaps
Executing on the strategy: 2023 Product roadmaps Engage consumers Grow sellers Transform B2B Grow ARPL through product and Secure listing content Helping agents find sellers pricing Leverage agents VAS Content Discovery VAS for property developers recommendations Deeper personalised experience 29
Slide 30: Developing our #1 position in Sweden is key for consumer and customer growth
Developing our #1 position in Sweden is key for consumer and customer growth Consumer engagement: My Hemnet: The heart of our network effect A personalized experience for future growth Unique information Securing listing early about the consumer and throughout their lifecycle My Home: expanding beyo
Slide 31: Optimizing current portfolio and working with agents to drive revenue from sellers
Optimizing current portfolio and working with agents to drive revenue from sellers The levers for 2023 ARPL growth Optimize and improve feature bundling Listings with agent Sellers that upgrade recommendations after recommendations Getting more agents to recommend Segmented pricing 31
Slide 32: Agent search: matching agents and sellers to create new B2B growth
Agent search: matching agents and sellers to create new B2B growth In 2023 we will continue developing on, and launching new products connected with agent search Agent/Agency search visits 70k /week Extra clicks to Syns mer för säljare +25% Agent / Agent profile Office profile Office search 32
Slide 33: Property developers: introducing value added services to capture customer spend
Property developers: introducing value added services to capture customer spend We laid the foundation of our We will now capture growth by listing offering introducing VAS Evaluation based on market developments ● Projects Access to all Hemnet consumers Extra marketing possibilities for units throu
Slide 34: 2023 roadmap consists of concrete product initiatives targeted at our main customer groups
2023 roadmap consists of concrete product initiatives targeted at our main customer groups Engage consumers Grow sellers Transform B2B …By strengthening our network …By driving growth from our …By building and capitalizing on effects and expanding the user current portfolio: our investments: experie
Slide 35: Financial targets
Financial targets Cecilia Beck-Friis, CEO 35
Slide 36: Current targets
Financial targets Growth Profitability Leverage Dividend Current targets 15-20% 45-50% <2.0x 1/3 Medium-term adj. EBITDA Minimum dividend at portion Annual revenue growth Net debt to adj. EBITDA margin of net income* 36 * In the event that the Company retains excess cash, this will be returned to sh
Slide 37: Introducing a new long-term profitability target
Introducing a new long-term profitability target Financial targets for growth, leverage and dividend reiterated Growth Profitability Leverage Dividend Current targets 15-20% 45-50% <2.0x 1/3 Medium-term adj. EBITDA Minimum dividend at portion Annual revenue growth Net debt to adj. EBITDA margin of n
Slide 38: Q&A
Q&A 38
Slide 39: IR Contacts
Dial-in instructions IR Contacts IR Contacts Hemnet invites analysts, investors and media to participate in the results presentation of the fourth quarter on 27 January 2023 at 10:00 CET. The Jens Melin results will be presented by CEO Cecilia Beck-Friis and Interim CFO Jens Melin. The presentation
Slide 40: Disclaimer
Disclaimer This presentation may contain forward-looking information and statements with respect to the financial condition, results of operation and business of Hemnet Group AB (publ) (the "Company"). Such forward-looking information and statements are based on current expectations, estimates and pr