Slide 1: Financial Results for the 12 months to 31 March 2024
Financial Results for the 12 months to 31 March 2024 Investor Presentation • 28 May 2024
Slide 2: Disclaimer
Disclaimer • This presentation has been prepared by Serko Limited ("Serko"). All information is current at the date of this presentation, unless stated otherwise. All currency amounts are in NZ dollars unless stated otherwise. • Information in this presentation • is for general information purposes
Slide 3: Contents
Contents 04 CEO overview 11 Progress on strategy 19 Financial update 28 Outlook Darrin Grafton Shane Sampson CEO CFO Serko 3
Slide 4: CEO Overview
CEO Overview Refer to Appendix for definitions and descriptions of the non-GAAP measures used by management throughout this presentation. Serko 4
Slide 5: Successful FY24 execution delivering benefits
Successful FY24 execution delivering benefits Booking.com for Strengthened Delivering Enhanced executive Business growth market position operational leverage and expertise Partnership renewed for Retention and new On track for cashflow Strengthened executive further five years* growth in Australasia
Slide 6: Strong performance, on track for FY25 cashflow positive
Strong performance, on track for FY25 cashflow positive Revenue Costs Profit (loss) Balance sheet $71.2m $89.7m $83.9m $(15.9m) $80.6m Total Operating Total spend Net loss Cash income expenses 1% increase, below after tax on hand 48% increase 8% increase FY24 guidance 48% improvement 8% decrease YoY
Slide 7: Delivering consistent year-on-year growth
Delivering consistent year-on-year growth • Growth driven by progress of Booking.com for Business and strengthened Australasian performance. • Total income above the middle of the upwards revised guidance range provided in November. Total income $m Total online bookings Completed room nights $80m 6.
Slide 8: Annual growth driven by strong first half
Annual growth driven by strong first half • The first half benefitted from higher ARPB, favourable foreign exchange rates and higher-than-expected business travel volumes in Australasia. • Second half revenue was lower than expected mainly driven by slower growth in completed room nights than projec
Slide 9: Sustainable, scalable growth remains critical focus
Sustainable, scalable growth remains critical focus • Total spend of $83.9m, up 1% on FY23 and below the FY24 guidance range of $86 million to $90 million. • Total operating expenses, up 8% on FY23, reflecting an increase in amortisation and depreciation along with increased hosting and other operat
Slide 10: On track for positive cashflow for FY25
On track for positive cashflow for FY25 Underlying cash flow Underlying average monthly cash burn* FY22 FY23 FY24 FY22 FY23 FY24 $3.3m ($7.1m) $2.7m ($32.6m) $0.6m ($39.6m) * Underlying cash burn is adjusted for one-off items such as: net funds from capital raise and payments made in 2H23, that ordi
Slide 11: Progress on strategy
Progress on strategy Serko 11
Slide 12: Progress on our strategic priorities
Progress on our strategic priorities FY24 Experimentation Booking.com Australasian Technology and High employee Business benefits delivery and growth market leadership product innovation engagement Highlights $4.3 million* annualised 65% increase in Strengthened market Strengthened product Employee
Slide 13: Unmanaged Travel: Upward trend with strong first half
UNMANAGED TRAVEL Upward trend with strong first half Completed Room Nights (CRN) Average revenue per CRN (€) Active customers (k) 1.3m 1.2m 176 172 € 10.10 € 10.09 1.1m € 9.03 € 9.38 157 € 6.61 € 7.04 109 0.5m 64 0.2m 28 0.1m 1H22 2H22 1H23 2H23 1H24 2H24 1H22 2H22 1H23 2H23 1H24 2H24 1H22 2H22 1H23
Slide 14: Unmanaged Travel: Progress underpinned by innovation and execution
UNMANAGED TRAVEL Progress underpinned by innovation and execution Examples of features rolled out in FY24 Jun 2023 Jun 2023 Oct 2023 Nov 2023 Dec 2023 Mar 2024 Content and Room Travel Travel Hotel Personalised servicing selection tracking receipts budgets stay Partnered with CWT Intuitive room Integ
Slide 15: Unmanaged Travel: Booking.com for Business plans
UNMANAGED TRAVEL Complete H2 FY22 –23 FY23 –24 Booking.com for Business plans Phase 1 Phase 2 Phase 3 Migration Activating + Scaling Engaging Foundation complete. Plans to increase growth being activated Customer acquisition growth Active customer growth Volume growth • Testing new online • A combin
Slide 16: Managed Travel: Strengthened market position in Australasia
MANAGED TRAVEL Strengthened market position in Australasia Online bookings up 13% in Australia and New Zealand • Online bookings were up 13% in Australasia online bookings (m) Australasia ARPB ($) Australia and New Zealand to 3.9 $5.33 $5.11 $5.06 million, the result of increased 2.0m $4.91 $4.87 $5
Slide 17: Managed Travel: Continued strengthening of Zeno offer
MANAGED TRAVEL Continued strengthening of Zeno offer Examples of features rolled out in FY24 Jul 2023 Sep 2023 Nov 2023 Jan 2024 Apr 2024 (post balance date) Vehicle selection Online changes Airline aggregator Hotel shopping Sabre NDC integration Allows customers Empowers travel bookers Enables the
Slide 18: Progress on sustainability practices
Progress on sustainability practices Environment Social Governance • Completion of our inaugural mandatory • New Guiding Principles introduced to guide • Improved capability in our board Climate-Related Disclosures under the our behaviours, decisions and actions and executive team Aotearoa New Zeala
Slide 19: Financial Update
Financial Update Audited financial results for the 12 months to 31 March 2024 Serko 19
Slide 20: Net profit summary / EBITDAF reconciliation
Net profit summary / EBITDAF reconciliation Net Profit Summary EBITDAF Reconciliation 2024 #039;m 2023 #039;m change #039;m change % Revenue 68.8 46.5 22.3 48% Other income 2.4 1.5 0.9 58% • Continuing to achieve operating Total income 71.2 48.0 23.2 48% leverage as revenue grows. (89.7) (82.8) (6.9) (8%) •
Slide 21: Revenue analysis
Revenue analysis Revenue and other Income by Type 2024 2023 change change #039;m #039;m #039;m % • Booking.com for Business partnership Revenue – transaction and usage fees: continues to drive growth in the Travel platform booking revenue 19.2 16.3 2.9 18% Supplier Commissions category and Expense platform r
Slide 22: Operating expenses
Operating Expenses FY24 v FY23 $95m Operating expenses $90m $3.9m $0.9m $1.8m $85m $1.0m $2.4m $1.0m • Serko has maintained cost control for $80m FY24 while continuing to drive the $89.7m $75m business towards its growth $82.8m objectives. $70m • Total remuneration and benefits were $65m FY23 Remune
Slide 23: Total spend
Total spend • Total Spend for the year was held Total Spend 2024 2023 change change almost flat, increasing to $83.9 million #039;m #039;m #039;m % from $83.3 million (1% increase). • Increases in Other operating expenses Expenses from ordinary activities 89.7 82.8 6.9 8% and Third party direct costs were Ad
Slide 24: Headcount
Headcount Total headcount Geography of headcount 400 364 347 331 300 200 FY24 FY23 100 - FY22 FY23 FY24 Employees Contractor New Zealand Australia United States China Serko 24
Slide 25: Product design and development
Product design and development • Product design and development Product Design and Development Expenditure 2024 2023 Change Change (PD&D) costs is a non-GAAP measure #039;m #039;m #039;m % representing the internal and external costs related to PD&D that have been Total Product Design & Development 40.7 41.7
Slide 26: Underlying cash flow
Underlying cash flow • Underlying cash flow is a proxy for Adjusted Cash flow 2024 2023 Change Change free cash flow and excludes #039;m #039;m #039;m % movements between cash and short Adjusted cash flows from operating activities 4.7 (19.2) 23.9 125% term investments, cash flows related Adjusted cash flows
Slide 27: Balance sheet
Balance sheet • Serko’s balance sheet remains strong Balance Sheet 2024 2023 Change Change with cash and short-term investments #039;m #039;m #039;m % of $80.6 million and no debt. • Intangibles decreased as the Group's Cash and Short Term Deposits 80.6 87.7 (7.1) (8%) software assets are amortised at a Othe
Slide 28: Outlook
Outlook Serko 28
Slide 29: Outlook
Outlook Serko anticipates demand for business travel in its key markets to remain strong. Serko expects new unmanaged customer acquisition and activation initiatives to drive increased volumes and total income during the FY25 year, weighted to the second half. Serko also anticipates growth at FY24 l
Slide 30: Q&A
Q&A Serko 30
Slide 31: Appendix
Appendix Serko 31
Slide 32: Definitions
Definitions Non-GAAP (generally accepted accounting practices) financial measures do not have standardised meanings prescribed by GAAP and therefore may not be comparable to similar financial information presented by other entities. Non-GAAP measures are used by management to monitor the business an
Slide 33: Definitions (continued)
Definitions (continued) • EBITDAF is a non-GAAP measure representing Earnings Before the deduction of costs relating to Interest, Taxation, Depreciation, Amortisation, Foreign Currency (Gains)/Losses and Fair value measurement. • Headcount is a non-GAAP measure comprising of the number of employees
Slide 34: FY24 results summary
FY24 results summary 1H23 2H23 FY23 1H24 2H24 FY24 FY24 v FY23 % Financial ($m) Total income $19.4m $28.6m $48.0m $36.3m $34.8m $71.2m 48% Total operating expenses $42.3m $40.5m $82.8m $45.3m $44.4m $89.7m 8% Total spend $41.1m $42.2m $83.3m $42.2m $41.8m $83.9m 1% EBITDAF gain/(loss) ($16.9m) ($4.9
Slide 35: Serko at a glance
180+ 4.9 million+ 640,000+ countries with trips booked registered customers active users annually across the globe 2007 5 offices 340+ founded over New Zealand, size of our team USA, Australia, China
Slide 36: Thank you
Thank you serko