Car Group Limited · ASX:CAR
Car — FY2022 Earnings Presentation
45 slides from Car's earnings presentation, Aug 15, 2022
Slide 1: Full Year Results Presentation
Full Year Results Presentation YEAR ENDED 30 JUNE 2022
Slide 2: Disclaimer and Non-IFRS Information
Disclaimer and Non-IFRS Information Disclaimer Non-IFRS Financial Information The material in this presentation has been preparation of such statements, actual carsales' results are reported under prepared by carsales.com Limited (ASX: results may vary in a material manner. International Financial R
Slide 3: Contents
Contents Performance Summary 4 – 11 Group Financial Review 12 – 17 carsales Australia 18 – 22 carsales International 23 – 28 Strategy Update 29 – 36 Appendix 37 – 44 3
Slide 4: Performance Summary
Performance Summary
Slide 5: FY22 Financial Highlights
FY22 Financial Highlights • Strong revenue growth and good earnings growth with good progress on strategy execution1 • Results demonstrate strength of offer and market positions as well as diversification of business across industry, geography, and customer segments • Domestic revenue growth has acc
Slide 6: FY22 Operating Highlights
FY22 Operating Highlights Metrics reflect the value we create for our customers and our growing scale Marketplace Highlights Dealer Highlights Consumer Highlights 2.1 million 46 thousand 19 billion Vehicles online1 Subscribed dealers2 Page views3 1.3 billion 385 thousand 6.7x more preferred Total se
Slide 7: An Internationally Diversified Business
An Internationally Diversified Business We are expanding into new geographies to access large and fast-growing addressable markets Diversifying our geographical mix Diversifying our industry mix Look-through Revenue Contribution1 Look-through Revenue Contribution1 Australia International Auto Non-au
Slide 8: Positioned To Drive Long-Term Growth and Shareholder Value
Positioned To Drive Long-Term Growth and Shareholder Value carsales operates in large addressable markets, that have been accelerated by COVID-related digitisation Emerging Australian Australia International Non-Marketplace Digital Opportunities Dealer Private Media US Korea LatAm Digital Digital De
Slide 9: Strong Strategy Execution in FY22
Strong Strategy Execution in FY22 We continue to deliver on our strategic priorities, enabled by digital transformation Australia International and ESG Strategic FY22 Strategic FY22 Opportunity TAM1 Opportunity TAM Priority Achievements Priority Achievements ✓ Reached 2,500 cars online South Korea:
Slide 10: Leading to Excellent Results
Leading to Excellent Results We have delivered good financial performance with double-digit revenue and EBITDA growth Pro-forma1 Adjusted Revenue ($m) Pro-forma1 Adjusted EBITDA ($m) Australia International Australia International +11% +10% 800 400 383 705 700 347 635 350 600 156 297 300 136 500 263
Slide 11: And a Positive Outlook Heading Into FY23
And a Positive Outlook Heading Into FY23 We have good momentum heading into FY23 with a strong track record of delivering growth through a highly resilient and diversified business model Outlook statement1 Pro-forma Basis2 We expect to deliver good growth in Adjusted Revenue and Adjusted EBITDA in F
Slide 12: Group Financial Review
Group Financial Review
Slide 13: Strong Track Record of Growth
Strong Track Record of Growth Well positioned to continue delivering long-term shareholder value through world-class capability, exposure to international growth markets and investment in new products and services Adjusted Revenue1 Adjusted EBITDA1 Adjusted NPAT1 CAGR 8% CAGR 8% CAGR 11% 272 195 510
Slide 14: Look-through Growth
Look-through1 Growth Strong track record of Look-through Revenue & EBITDA growth, with increasing contributions from existing international business and the inclusion of Trader Interactive Look-through1 Revenue Look-through1 EBITDA carsales Australia carsales International carsales Australia carsale
Slide 15: Adjusted Net Profit After Tax Summary
Adjusted1 Net Profit After Tax Summary Consolidated Year Ending $A Millions Growth PF Growth 2 Commentary 30 June 2022 FY21 FY22 $'s % % 1 1• Cost of goods sold and operating expenses increase due to the Adjusted Revenue 437.8 509.5 71.8 16% 11% acquisition of tyreconnect in 1 July-21 1 Cost of good
Slide 16: EBITDA Margin Summary
EBITDA Margin Summary 1 Strong underlying margin performance in the core business 1• Underlying margin expansion reflects solid revenue result combined with diligent cost control, whilst continuing to invest in future growth initiatives 2• Investment in Placie and higher freight costs in the Tyres g
Slide 17: Strong Cash Flow and Robust Balance Sheet
Strong Cash Flow and Robust Balance Sheet Cash flow conversion Capex Leverage3 and net debt4 • Continued investment in new products and • Net debt and leverage ratio increase reflects • Good conversion of EBITDA to cash flow technology to support current and long- incremental debt drawn down as part
Slide 18: carsales Australia
carsales Australia
Slide 19: Market Observations
Market Observations carsales inventory is growing Traffic remains high vs. pre-pandemic Inventory (000) Visits (m) 170 400 350 160 300 150 250 140 200 150 130 100 120 50 0 FY19 FY22 New car demand is solid Dealer profit margins are high New Car Sales (m)1 Gross Profit per Used Car ($)2 1.4 4,000 3,8
Slide 20: Australia Revenue – Dealer & Media
Australia Revenue – Dealer & Media Dealer Adjusted Revenue1 up 6% to $183.8m Media Adjusted Revenue1 up 15% to $54.5m +6% +15% 1% 4% 4% 6% 3% 1% 2% • Solid dealer performance supported by a buoyant automotive • Third consecutive half-year of double-digit revenue growth with market in H2 FY22 with st
Slide 21: Australia Revenue – Private & DR&S
Australia Revenue – Private & DR&S Private Revenue up 26% to $69.4m DR&S Adjusted Revenue1 up 3% to $44.1m +26% +3% 3% 12% 3% 0% 11% • Outstanding revenue growth of 26% on pcp (H2 up 17% vs. pcp) • Resilient result given the impact of lock downs and continued supported by good trading conditions, st
Slide 22: Australia Revenue – carsales Investments
Australia Revenue – carsales Investments carsales Investments Revenue up 109% to $56.5m Performance commentary • Good growth in volumes in FY22. From a 56.5 profitability perspective, there were strong uplifts in rebates and purchasing efficiencies. However, these were offset by increases in freight
Slide 23: carsales International
carsales International
Slide 24: Market Observations
Market Observations In all our markets inventory is growing and traffic remains high vs. pre-pandemic levels Visits (m)1 Page Views (billions)2 Visits (m)1 300 8 335 7 330 250 6 325 200 5 320 4 315 150 3 310 100 2 305 FY19 FY22 FY19 FY22 FY19 FY22 Inventory (m)3 Inventory (000)4 Inventory (000)4 1.3
Slide 25: Americas – Trader Interactive
Americas – Trader Interactive Excellent revenue and EBITDA growth, recovering inventory volumes driving momentum Financial summary1 Performance commentary $A Millions Growth Constant • Excellent financial performance in FY22, with revenue and Pro-forma 100% 3 FY21 FY22 $'s % Currency EBITDA growth o
Slide 26: Asia – Encar
Asia – Encar Strong growth from Encar, underpinned by continued momentum of key products Financial summary Performance commentary Strong financial performance across revenue and EBITDA which $A Millions Growth Constant has been driven by strong growth from three key products: 2 FY21 FY22 $'s % Curre
Slide 27: Americas – webmotors
Americas – webmotors Very strong revenue and EBITDA growth driven by strong volumes and yield expansion Financial summary Performance commentary • Excellent financial performance with 26% growth in $A Millions Growth Constant revenue and 23% growth in EBITDA in constant currency Pro-forma 100% 1 FY2
Slide 28: Americas – chileautos and soloautos
Americas – chileautos and soloautos Difficult trading conditions in Chile and Mexico partly mitigated by strong cost management Chile – chileautos Mexico – soloautos $A Millions Growth Constant $A Millions Growth Constant FY21 FY22 $'s % Currency 1 FY21 FY22 $'s % Currency 1 Revenue 4.7 4.8 0.1 3% 1
Slide 29: Strategy Update
Strategy Update
Slide 30: Australia and International Priorities
Australia and International Priorities Australia International Dealer, Data Research & Private Domestic Korea US LatAm Media Services Seller Investments Auto Non-Auto Automotive (DR&S) Market Auto Dealer Extension Premium ad leadership, Traditional Consistent volume, yield diversification penetratio
Slide 31: Select is Ramping Up
Select is Ramping Up We have made excellent progress in digital retailing in only twelve months since launching Inventory is growing Phase 1: Phase 2: Phase 3: Find and reserve car Trade-in valuation Credit check and finance We have now sold over 6,000 cars1 through the platform since inception 8 To
Slide 32: Instant Offer Momentum is Growing
Instant Offer Momentum is Growing carsales’ Instant Offer service enables consumers to sell their car quickly and easily at a competitive price Brand marketing campaign launched in Q3 FY22 Key sales funnel steps Growth drivers Quarterly transaction volume Increase volume: Improve brand awareness thr
Slide 33: Dynamic Pricing Delivering Excellent Growth, with More Upside to Come
Dynamic Pricing Delivering Excellent Growth, with More Upside to Come Improvements made to dynamic pricing have unlocked excellent yield benefit with room to increase further Private ad yield growth And there is significant runway in further price has accelerated… to value alignment • Since implemen
Slide 34: Trader Interactive Priorities
Trader Interactive Priorities 100% ownership will unlock and accelerate growth opportunities Market New Products ROI and Value Digital Retailing Cost Leadership and Services Proposition & Trade-ins Synergies Key priorities Key priorities Key priorities Key priorities Key priorities 1• RV & Powerspor
Slide 35: Encar Priorities
Encar Priorities We are making excellent progress on key priorities and will expand our offering in FY23 Guarantee Cars Dealer Direct Encar Home Encar inspects and guarantees the condition Consumers sell their car instantly at a great Dealers retail their car completely online using of dealer cars t
Slide 36: webmotors Priorities
webmotors Priorities Our world-class digital automotive products are enabling further integration with Brazilian dealers Accelerate growth of new digital products Increase dealer take-rates FY23 priorities 1• Improve lead yield through price optimisations and improvements to the commercial model 2•
Slide 37: Appendix
Appendix
Slide 38: Overview of carsales Non-IFRS Financial Information
Overview of carsales Non-IFRS Financial Information What is IFRS and non-IFRS financial information presented is sourced directly presentations in order to allow the reader to information? from financial information prepared in clearly reconcile between the IFRS and non- accordance with all relevant
Slide 39: Segment Revenue & EBITDA
Segment Revenue & EBITDA Actual Basis2 Pro-forma Basis3 4 4 $A Millions FY21 FY22 Growth % CC % FY21 FY22 Growth % CC % Dealer 174.2 183.8 5% 5% 174.2 183.8 5% 5% Private 55.3 69.4 26% 26% 55.3 69.4 26% 26% Media 47.5 54.5 15% 15% 47.5 54.5 15% 15% Online Advertising 276.9 307.7 11% 11% 276.9 307.7
Slide 40: P&L by Country
P&L by Country Look-through1 Excluding Acquisitions2 $A Millions FY21 FY22 Growth % CC%3 FY21 FY22 Growth % CC%3 Australia 340.5 402.3 18% 18% 340.5 373.8 10% 10% International 109.8 206.7 88% 90% 109.8 126.5 15% 17% Brazil 18.8 25.2 34% 26% 18.8 25.2 34% 26% United States - 80.2 n/a n/a - - n/a n/a
Slide 41: Reconciliation of Reported to Adjusted Financials
Reconciliation of Reported to Adjusted Financials FY21 FY22 Growth % $A Millions Reported Adjustments Adjusted Reported Adjustments Adjusted Reported Adjusted Revenue 427.2 10.7 437.8 509.1 0.5 509.5 19% 16% Operating expense 185.7 (2.1) 183.6 239.1 (1.3) 237.8 (29%) (30%) EBITDA 241.5 12.7 254.2 26
Slide 42: Reconciliation of Reported to Adjusted Financials
Reconciliation of Reported to Adjusted Financials Consolidated carsales Group FY21 FY22 $A Millions Revenue EBITDA NPAT Revenue EBITDA NPAT Reported Financials 427.2 241.5 130.7 509.1 269.9 160.8 Dealer Support Package 10.7 10.7 7.5 0.5 0.5 0.3 Restructuring and M&A transaction costs - 2.0 1.5 - 1.7
Slide 43: Total Addressable Markets – Emerging Digital Opportunities
Total Addressable Markets – Emerging Digital Opportunities Australia Auto – Emerging Digital Opportunities Market Digital Retailing Digital trade-in Finance Commissions Product Dealer Finance Annual transaction volume1 1.0m 2.25m 2.0m (B2C - used) (trade-in + C2C) (B2C) x Addressable share 15%2 20%2
Slide 44: Total Addressable Markets – United States
Total Addressable Markets – United States Recreational Commercial Total Powersports Equipment Vehicles (RVs) Trucks Key Brand Annual sales volume 15m 0.75m 1.5m 10m 2.5m x Average unit price $35k $32k $10k $35k $60k = Annual sales value $516bn $24.5bn $16bn $335bn $140bn x Marketing % of sales 0.6%
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