Slide 1: Jumbo Interactive Limited Results Presentation
JUMBO INTERACTIVE LIMITED RESULTS PRESENTATION For the half year ended 31 December 2019 ABN 66 009 189 128
Slide 2: Contents
CONTENTS RESULTS HIGHLIGHTS 2 SOFTWARE AS A SERVICE 6 JUMBO LONG TERM GROWTH PROFILE 8 FINANCIAL PERFORMANCE 10 DIVIDENDS OVERVIEW 12 FINANCIAL POSITION 13 CASH FLOW 14 VISION & STRATEGY 15 OUTLOOK 18 H1 FY20 Results Presentation | 1
Slide 3: Results Highlights
RESULTS HIGHLIGHTS CUSTOMERS CLEARLY LOVE PLAYING ON JUMBO LEADING TO STRONG FINANCIAL RESULTS ▪ 848,621 Active Customers up 118% over 2 years (+47% pcp) ▪ TTV up 25.3% prior comparitive period (pcp) to $185.3 million ▪ 16.9% Customer Dormancy Rate reduced 42% over 2 years – 26.7% (21.5% pcp) of all
Slide 4: Results Highlights (continued): Customer engagement and loyalty
RESULTS HIGHLIGHTS (CONTINUED) CUSTOMER ENGAGEMENT AND LOYALTY DRIVEN BY INNOVATION ▪ Further innovations to enhance engagement and loyalty ▪ Lotto Party – Artificial Intelligence (AI) and Machine Learning (ML) to – Friends play socially as a group improve personalisation and relevance to individual
Slide 5: Online Lotteries - A Growing Market
RESULTS HIGHLIGHTS (CONTINUED) ONLINE LOTTERIES - A GROWINGMARKET ▪ 26.7% of Australian lottery tickets now sold online1 – 5 year CAGR 22% to FY2019 – 5 year CAGR 29.6% to FY2019 of Jumbo flagship website ozlotteries.com (lottery and charity games) ▪ The only pure digital play listed lottery company
Slide 6: Good Run of Large Jackpots
RESULTS HIGHLIGHTS (CONTINUED) GOOD RUN OF LARGE JACKPOTS ▪ 23 large jackpots (Oz Lotto/Powerball at or above $15 million) vs. 23 in pcp: – Aggregate value of large jackpots - $1,070 million vs. $860 million – Average value per large jackpot - $46.5 million vs. $37.4 million ▪ 8 Jackpots at or above
Slide 7: Software as a Service (SaaS) Powered by Jumbo
SOFTWARE AS A SERVICE (SaaS) “POWERED BY JUMBO” ▪ Large Global TAM – US$303 billion Total Addressable Market 1 – Only 7% is online – “Powered by Jumbo” is a complete solution for lotteries seeking to move online ▪ Initial target - Charity lotteries – Smaller charity lotteries looking to improve thei
Slide 8: Software as a Service (SaaS) Powered by Jumbo (continued)
SOFTWARE AS A SERVICE (SaaS) “POWERED BY JUMBO” (CONTINUED) ▪ New POS (Point of Sale) Solution – Provides portable and desktop digital sales capability – Tablet based with wireless payments device 1 Sources: The WLA Global Lottery Data Compendium 2018; Jumbo Research; 2 Sources: Jumbo Research; lott
Slide 9: Long Term Growth Profile
LONG TERM GROWTH PROFILE TOTAL TRANSACTION VALUE (TTV) REVENUE 5 year CAGR FY2019 - 24.6% 5 year CAGR FY2019 - 21.3% NET PROFIT AFTER TAX - CONTINUING OPERATIONS EBITDA MARGIN - CONTINUING OPERATIONS 5 year CAGR FY 2019 - 43.3% H1 FY20 Results Presentation | 8
Slide 10: Financial Performance - Like-for-Like Analysis
FINANCIAL PERFORMANCE (CONTINUED) – LIKE-FOR-LIKE ANALYSIS • Removes the influence of jackpot size • Compares sales over time at fixed jackpot levels • Indicates customer engagement and loyalty • Indicates resilience in years of low jackpots Ticket sales per draw ($) Ticket sales per draw ($) H1FY18
Slide 11: Financial Performance
FINANCIAL PERFORMANCE KEY ITEMS: H1 FY20 H1 FY19 Change ▪ TTV up 25.3% $’000 $’000 % ▪ Revenue up 23.1% Total Transaction Value 185,303 147,849 25.3% ▪ Total expenses up by 36.7% mainly associated directly with increased TTV and Revenue from continuing operations 37,554 30,510 23.1% revenue; Gatherw
Slide 12: Financial Performance: Underlying Performance
FINANCIAL PERFORMANCE UNDERLYING PERFORMANCE: ▪ One-off expenses – $412,000 Gatherwell acquisition expenses ▪ Step change expenses – Strategic decision made to support the increase in scale of business and expected growth over next three to five years – $1,150,000 estimated circa step change expense
Slide 13: Dividend Overview
DIVIDEND OVERVIEW EXCEPTIONAL SHAREHOLDER RETURN FROM A GROWTH COMPANY ▪ Strong cash generative nature of operations supports ▪ 80.7% payout ratio - Targeted dividend policy of 85% of NPAT dividend policy for the full year is retained ▪ Interim fully franked dividend: ▪ $8.3 million franking credit
Slide 14: Financial Position
FINANCIAL POSITION at 31 Dec at 30 Jun Change KEY ITEMS: 2019 2019 CASH $’000 $’000 % ▪ Strong cash position of $71.2 million – General funds down 19.5% to $59.4 ASSETS 108,014 101,622 6.3% million with funding of $9.5 million Current Assets 74,467 85,536 (12.9%) Gatherwell acquisition from cash res
Slide 15: Cash Flow
CASH FLOW at 31 Dec at 31 Dec Change KEY ITEMS: 2019 2018 $’000 $’000 % ▪ Strong cash position of $71.2 million CASH FLOWS FROM OPERATING ACTIVITIES ($59.4 million general funds) Receipts from customers 39,649 33,363 18.8% ▪ Payments for intangibles relate to Payments to suppliers & employees (21,48
Slide 16: Vision & Strategy: The $1 Billion Vision
VISION & STRATEGY THE $1 BILLION VISION ‘$1 Billion in ticket sales on the Jumbo platform by FY22’ ▪ Includes both the ticket reseller business and the SaaS business ▪ $320 million at June 2019 ▪ $358 million at Dec 2019 ▪ Additional $135 million under contract with 3 Charities to be onboarded over
Slide 17: Vision & Strategy: Nuts and Bolts
VISION & STRATEGY (CONTINUED) NUTS AND BOLTS HOW WILL WE GET TO $1 BILLION IN TICKET SALES? ▪ Best of breed Software Platform – Jumbo’s own metrics prove the platform’s effectiveness – Ongoing software development – Continue to improve customer engagement KPI’s – Continue to maintain ‘Powered by Jum
Slide 18: Strategy - First to Market with Online Innovations
VISION & STRATEGY (CONTINUED) STRATEGY - FIRST TO MARKET WITH ONLINEINNOVATIONS ▪ Lotto Party - Online lotterysyndication: – First online lottery operator to offer syndication inAustralia – Group play as a percentage of total TTV has increased to 10% – Combats jackpot fatigue – Drives growth through
Slide 19: Outlook
OUTLOOK The business is well placed for the future: ▪ Step change in FY2020 to support the increase in scale of the business and planned future growth ▪ Revenue from Reseller agreements: – 5 year CAGR FY2019 of 25.0% for lotteries segment – Increasing digital penetration – 26.7% H1 FY2020 – Continui
Slide 20: Disclaimer
DISCLAIMER This presentation contains summary information about the current make an investment decision regarding Jumbo shares. activities of Jumbo Interactive Limited (Jumbo). It should be read in All dollar values are in Australian dollars (A$) unless otherwise conjunction with Jumbo’s other perio
Slide 21: FY19 Results Presentation | 18
FY19 Results Presentation | 18