Edreams Odigeo · BME:EDR
Edreams Odigeo — FY2016 Earnings Presentation
48 slides from Edreams Odigeo's earnings presentation, Jun 20, 2016
Slide 1: Fiscal Year 2016 Annual Results Investor presentation
Fiscal Year 2016 Annual Results, ending March 31st 2016 Investor presentation June 20th 2016
Slide 2: Disclaimer
Disclaimer Certain statements included or incorporated by reference within this presentation may constitute “forward-looking statements” in respect of the Group’s operations, performance, prospects and/or financial condition and the industry in which the Group operates. By their nature, forward-lo
Slide 3: Agenda
AGENDA 12 Months Results Highlights Industry Overview & Strategic Developments Financial Analysis Outlook Appendix 2 FY 2016 Results Presentation
Slide 4: Results Highlights
Results Highlights Solid results with growth in bookings, revenue margin & EBITDA Solid Cash flow Strategic initiatives on track and delivering improved performance Improved business proposition and business model Benefits from channel mix re-alignment Customer experience & client satisfaction
Slide 5: Solid results
Solid results Bookings Revenue Margin Adjusted EBITDA In thousands In € million In € million +10% +6% +6% 10,675 463.3 95.8 9,724 436.0 90.5 12M 12M 12M 12M 12M 12M MARCH MARCH MARCH MARCH MARCH MARCH 2015 2016 2015 2016 2015 2016 > 9.7 million > €436 million €91-94 million Initial guidance Initial
Slide 6: Strategy delivering good growth in adjusted EBITDA
Strategy delivering good growth in adjusted EBITDA Adjusted EBITDA quarterly Evolution % Growth normalised for no Q4 bonus payment last year. YoY variation 100% accrual this year +18% +9% Bookings Adj. Ebitda 20.0% 13% +7% 13.5% 7% 7% 10.0% 6.2% 0.7% 1.4% 0.0% Revenue Margin -10.0% -9% -20.0% -10.8%
Slide 7: Flight and Non-flight bookings
Flight and Non-flight bookings: Strong growth in the flight business and non-flight back to growth Flight - Bookings Flight In ‘000 +11% 9,750 Progress in strategic initiatives has 8,770 delivered solid growth in bookings − Growth driven by Core and Expansion markets +9% 2,406 2,626 Non-Flight N
Slide 8: Flight and Non-flight revenue margin
Flight and Non-flight revenue margin: Solid growth in flight and strong growth in non-flight Flight - Revenue Margin Flight In € million +5% Revenue margin solid growth at 367.3 348.3 +5% for the full fiscal year 2016 Due to our continued efforts to +2% improve product, re-orient price and 98.9
Slide 9: Core and Expansion bookings
Core and Expansion bookings: Core positive growth for third consecutive quarter Core - Bookings In ‘000 +2% Core 5,296 5,381 Core bookings trend continues to improve in FY 2016, with growth in flight business mainly in Spain and Italy +8% 1,319 1,427 − Partially offset by a decrease of our charter
Slide 10: Core and Expansion revenue margin
Core and Expansion revenue margin: Positive growth in all our Core markets Core Markets - Revenue Margin In € million Core 0% 255.9 255.1 Significant improvement in the revenue trajectory in Q4 − All 3 markets within Core grew in +8% revenue margin in Q4 2016 67.6 72.9 compared to Q4 2015, the fir
Slide 11: Agenda
AGENDA 12 Months Results Highlights Industry Overview & Strategic Developments Financial Analysis Outlook Appendix 10 FY 2016 Results Presentation
Slide 12: The important role of an OTA in a fragmented consumer market
The important role of an OTA in a highly fragmented and more sophisticated consumer market place Today’s consumers eDreams’ Raison D’Etre 1. Travel more than ever Give consumers the ability to compare millions before of options in seconds, to get best value, choice and 2. Expect personalised servi
Slide 13: eDreams ODIGEO is well positioned for growth
eDreams ODIGEO is well positioned for growth eDreams ODIGEO is well eDreams ODIGEO has a strong foothold Penetration of online travel positioned to capture above in the European flights Market is increasing rapidly average growth Flights gross bookings Online travel penetration in Calendar 2016E Eur
Slide 14: #1 flights retailer in Europe and gaining market share
eDreams ODIGEO: #1 flights retailer in Europe1 and gaining market share 1 eDreams ODIGEO’s brands are 1 leaders in the main European # countries for the OTA market in regular flights # Sweden 2 Finland According to our estimations, we Norway 2 are the number one player on the 2 flight business i
Slide 15: Strategic progress - FY 2016
Strategic progress - FY 2016 Traffic source ▪ Bookings grew by 10% while variable costs per bookings decreased by 6% (channel mix) 1 Mobile ▪ Mobile bookings accounted for 24% of total flight bookings (FY 2016 average) 2 ▪ Mobile bookings increased 51% y-o-y; mobile downloads increased 49% y-o-y Cus
Slide 16: Traffic source (Channel Mix) re-alignment
Traffic source (Channel Mix) re-alignment In FY 2016 we have been Investments in our product has re-orienting our global contributed to a reduction in our traffic acquisition total variable cost per booking of performance and ROI 6% while maintaining booking improvements growth of 10% in FY 2016 Var
Slide 17: Strong growth in Mobile Bookings FY 2016
Strong growth in Mobile Bookings FY 2016 Flight Mobile bookings As a % of flight bookings 30% 24% 25% 20% 18% 15% 10% +5pp +7pp 10% +0pp 17% 5% 10% 13% EU industry 0% average FY 2014 FY 2015 FY 2016 +51% +49% y-o-y increase of Flight mobile Mobile downloads, bookings increase reaching 6.8 million y-
Slide 18: Customer Experience and client satisfaction significantly improved
Customer Experience and client satisfaction significantly improved A year of investment in …leading to continued improve- transforming the foundations ments in customer satisfaction of our customer experience… while reducing our cost to serve >20% reduction of contacts Introduced a revised Help
Slide 19: Revenue diversification – What is working well
Revenue diversification – Highlights fiscal year 2016 What is working well +37% revenue margin y-o-y ▪ Liligo - Leader in France – Present in 11 countries Advertising Dynamic +17% revenue margin y-o-y & Packages ▪ New platform - Early signs encouraging Metasearch Mobile bookings accounted for 24% of
Slide 20: Liligo working well, expanding geographically and multi-modal
Liligo working well, expanding geographically and multi-modal Leader in France High growth Repeat user rate #1 +37% >45% present in 11 countries advertising and high engagement and expanding metasearch rate Multi modal comparison offering Launch of multi modal comparison in key markets (France, US,
Slide 21: Revenue diversification – What is not working well
Revenue diversification – Highlights fiscal year 2016 What is not working well Decline > 30% revenue margin y-o-y All markets suffer poor performance as we face technical and content challenges Holiday Hotels Packages – Coupled with terrorist related market declines Mobile bookings accounted for 24%
Slide 22: Revenue diversification - What are we going to focus on
Revenue diversification - What are we going to focus on Traffic – New touchpoints, product portfolio approach, offline channels 1 focus on sales Conversion – focus on improving conversion and build web mobile solutions Dynamic Inventory – Push priority destinations Packages 2 Step-change our
Slide 23: Flight notification services launch
Continued focus on mobile development, we recently launched our flight notification services What is it? BRANDS Coverage of the service It's a free service 90,000+ eDreams, Opodo flights tracked per day and GO Voyages offer to their app users to keep them updated on their flight details: delays, can
Slide 24: Strategic initiatives delivering higher performance and path for growth
Strategic initiatives are delivering higher performance and set the path for further growth Phase III (FY18-20) More diversified product portfolio & fully leveraging customer base Phase II (FY16-17) Improving profitability & investing in long term sustainability Phase I (FY 15-16) Stabilizing our bu
Slide 25: Agenda
AGENDA 12 Months Results Highlights Industry Overview & Strategic Developments Financial Analysis Outlook Appendix 24 FY 2016 Results Presentation
Slide 26: Income statement
Income statement Q4 Q4 Var FY FY Var Key highlights YTD Mar-15 Mar-16 Mar-15 Mar-16 (In € million) Revenue margin growth driven by bookings and partially offset by decrease in Revenue margin 121.2 129.4 7% 436.0 463.3 6% revenue margin per booking Variable costs (79.4) (78.8) (1)% (288.6) (297.5)
Slide 27: Adjusted Net Income
Adjusted Net Income Q4 Q4 FY FY Var Var Mar-15 Mar-16 Mar-15 Mar-16 (In € million) Net income (173.8) 5.9 N.A. (181.3) 12.4 N.A. Non-recurring items 5.6 2.7 (51)% 14.7 8.2 (44)% Amortisation impact related to the move of Barcelona offices - - N.A. - 0.4 N.A. Cancellation of amortized financing fees
Slide 28: Cash flow statement
Cash flow statement Q4 Mar-15 Q4 Mar-16 FY Mar-15 FY Mar-16 Key highlights YTD (In € million) Adjusted EBITDA 28.0 31.7 90.5 95.8 Cash flow from operations increased by €27.7 million Non recurring items (6.9) (3.4) (16.0) (10.5) − Increased adj. EBITDA Non operating / non cash items 0.2 4.6 7.7 4.
Slide 29: Debt cover ratio leaves headroom and stable interest coverage
Debt cover ratio leaves us plenty of headroom and stable interest coverage ratio Total Debt Coverage Ratio (Total Net Debt(1) / LTM EBITDA) Debt Details (million Principal Rating Maturity euros) Corporate Moodys:B2 Family S&P: B Rating 2018 Notes 325 Moodys:B3 01/08/18 S&P: B 2019 Notes 129 Moodys:C
Slide 30: Agenda
AGENDA 12 Months Results Highlights Industry Overview & Strategic Developments Financial Analysis Outlook Appendix 29 FY 2016 Results Presentation
Slide 31: Outlook 2016-17
OUTLOOK 2016-17 Outlook Targets for 2016-17 Focus on increasing the profitability of the business Bookings − Reduce areas in which we are not as profitable and not strategic to >10.7 million long term success Mobile bookings accounted for 24% of total Revenue flight bookings Margin (FY 2016 averag
Slide 32: Closing Remarks – Why invest in eDreams
Closing Remarks – Why invest in Edreams Attractive Industry Online Leisure Travel is the #1 Flight Retailer in Europe largest e-Commerce category Significant product growth opportunities FasterOptimise Europeanpricing Online & Travel penetration Growing market share marketing strategy Co
Slide 33: Agenda
AGENDA 12 Months Results Highlights Industry Overview & Strategic Developments Financial Analysis Outlook Appendix 32 FY 2016 Results Presentation
Slide 34: KPI historic evolution – eDreams ODIGEO
KPI historic evolution – eDreams ODIGEO Before change in revenue After change in revenue recognition recognition FY FY PF FY PF PF PF PF FY PF YTD YTD YTD 2013/14 Jun-14 Sep-14 Dec-14 Mar-15 2014/15 2013/14 Jun-14 Sep-14 Dec-14 Mar-15 2014/15 Jun-15 Sep-15 Dec-15 Dec-14 Dec-15 Dec-15 Number of booki
Slide 35: Quarterly impact of change in revenue recognition
Quarterly impact of change in revenue recognition Revenue margin 500.0 428.6 429.5 436.2 436.0 140.0 450.0 118.8 121.2 400.0 87.9 87.6 112.3 110.3 80.8 81.8 120.0 107.6 107.3 22.2 350.0 97.4 97.2 19.9 100.0 21.9 21.5 26.3 24.3 300.0 in € million 19.8 19.6 in € million 80.0 250.0 200.0 60.0 347.8 347
Slide 36: Variable and fixed costs
Variable and fixed costs Variable costs per booking Variable costs lower compared to last year as 35 our pricing and marketing optimization 30.6 30.0 30.2 29.7 strategies start to pay off on our marketing 29.0 30 costs in € per booking 25 27.9 28.0 27.6 27.9 Fixed costs per booking slightly abov
Slide 37: Balance sheet - Highlights
Balance sheet - Highlights Mar-15 Mar-16 Key Highlights YTD (In € million) Main changes relate to: Goodwill 727.8 728.4 Increase of other fixed assets mainly related to software developed internally Other fixed assets 290.9 304.0 Total fixed assets 1,018.7 1,032.3 Working capital slightly decrea
Slide 38: Working capital - Highlights
Working capital - Highlights Quarterly working capital Mar.15 Jun.15 Sep.15 Dec.15 Mar.16 - (50) (100) (189.7) in € million (246.9) (247.6) (236.1) (250.4) (150) (200) (28.5) (250) (29.5) (218.2) (31.8) (30.7) (26.2) (265.6) (300) (278.6) (278.3) (276.6) Working capital Non current deferred income S
Slide 39: Net debt information
Net debt information Net debt excl. capitalization of financing costs GEO Travel Finance Undrawn revolving credit Mar.15 Jun.15 Sep.15 Dec.15 Mar.16 Mar.15 Jun.15 Sep.15 Dec.15 Mar.16 facilities end of March 2016 - (100) In € million (200) (300) (400) (347.1) (348.2) (362.4) (339.3) (346.8) (348.1
Slide 40: Net debt analysis
Net debt analysis Mar-15 Jun-15 Sep-15 Dec-15 Mar-16 2019 Notes (129.0) (129.0) (129.0) (129.0) (129.0) 2018 Notes (325.0) (325.0) (325.0) (325.0) (325.0) Revolving Credit Facilities - - - - - Accrued interest (9.6) (12.4) (9.6) (12.4) (9.6) Other debts (finance lease, overdrafts, etc.) (5.0) (5.1)
Slide 41: Non recurring items breakdown
Non recurring items breakdown FY FY Mar-15 Mar-16 LTI plan 1.1 3.5 Restructuring provision Leicester & Paris 8.6 2.5 Other personnel 1.7 1.1 Exceptional consultancy fee - 1.3 Penalties related old Barcelona office - 0.5 Reallocation of Conv. Bonds 1.4 - Other expenses 3.1 1.6 Non recurring items 16.
Slide 42: Capex breakdown
Capex breakdown FY FY Mar-15 Mar-16 Common Platform 18.9 17.9 Mid/back office 4.2 6.1 Licence acquisition / (penalties for cancellation) 3.1 (1.7) Change in Barcelona office - 2.1 Hardware and others 9.1 6.0 Cash flow from investing activities incl. committed capex 35.2 30.5 Note: Unaudited 41 FY 20
Slide 43: Geo Travel Finance (1/2)
Geo Travel Finance (1/2) INCOME STATEMENT BALANCE SHEET (In € million) FY FY Var Mar-15 Mar-16 Mar-15 Mar-16 (In € million) Bookings 9,724 10,675 10% Goodwill 727.8 728.4 Other fixed assets 296.6 310.5 Revenue margin 436.6 464.4 6% Total fixed assets 1,024.4 1,038.9 Variable costs (288.6) (297.5) 3%
Slide 44: Geo Travel Finance (2/2)
Geo Travel Finance (2/2) CASH FLOW STATEMENT COVENANT CALCULATION FY FY (In € million) Mar-15 Mar-16 TOTAL DEBT COVER RATIO (TOTAL NET DEBT / LTM 92.0 97.9 Adj. EBITDA) Adjusted EBITDA Non recurring items (16.1) (10.3) Total Net Debt(1) Non operating / non cash items 7.7 4.1 3.36x (6.1) - LTM Adjust
Slide 45: Consolidated financial statements – Profit & Loss
Consolidated financial statements – Profit & Loss eDreams eDreams Geo Travel Geo Travel Consolidated Income statement ODIGEO ODIGEO Finance Finance YTD YTD YTD YTD In € thousand Mar. 2016 Mar. 2015 Mar. 2016 Mar. 2015. Revenue 484,650 465,732 485,770 466,363 Supplies (21,395) (29,770) (21,395) (29,7
Slide 46: Consolidated financial statements – Balance Sheet
Consolidated financial statements – Balance Sheet eDreams eDreams Geo Travel Geo Travel eDreams eDreams eDreams eDreams Consolidated balance sheet Consolidated balance sheet ODIGEO ODIGEO Finance Finance ODIGEO ODIGEO ODIGEO ODIGEO 31 Mar. 31 Mar. In € thousand 2016 31 Mar. 2015 31 Mar. 2016 31 Mar.
Slide 47: Consolidated financial statements – Cash Flow
Consolidated financial statements – Cash Flow eDreams eDreams Geo Travel Geo Travel Consolidated statement of cash flows ODIGEO ODIGEO Finance Finance YTD YTD YTD Mar. 2015 YTD Mar. 2015 In € thousand Mar. 2016 Mar. 2016 Net Profit / (Loss) 12,427 (181,306) 14,664 (193,307) Depreciation and amortiza
Slide 48: eDreams ODIGEO
eDreams ODIGEO