Lendingtree, Inc. · NASDAQ:TREE
Lendingtree — Friedman, Billings, Ramsey & Co. 7th Annual Growth Stock Conference 2003
37 slides from Lendingtree's conference presentation, May 28, 2003
Slide 1: LendingTree Business & Financial Overview
This presentation shall not be deemed to be an offer or a solicitation of an offer to buy any securities of LendingTree. LendingTree Business & Financial Overview Friedman, Billings, Ramsey & Co. 7th Annual Growth Stock Conference May 28, 2003
Slide 2: Forward-Looking Statements
LendingTree, Inc. — Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include statements relating to our anticipated financial performance, business prospects
Slide 3: Agenda
LendingTree, Inc. Agenda ¢ Business Overview - Lending + Business Overview — Real Estate * Operating & Financial Results * Long-Term Financial Projections 4 LendifigTree
Slide 4: The US Consumer Lending Market is Extremely Large
Business Overview - Lending The US. Consumer Lending Market is Extremely Large... 2002 Total Debt Outstanding Nen-Revelving R _ AideePerenal edit Cara Henne Feu Mortgage $9.1 Trillion Bar Fea rr ely, na erga he Qarety ep 208 8 me Eup 3 Satie Seege Lams Th 2002 Totat Originations by Product berne Feu
Slide 5: and Highly Fragmented
Business Overview - Lending and Highly Fragmented. Mortgage Originations by Source Lending Tree com 10.000 S168 6.794) Lenders $2218 196) lrep 18 Real Producers $7088 @3%6) arp $1,454 050) 50,000 Institutions $2.46 Trillion LendingTree Mortgage Market Shave ‘are Sorgen try tee formar treme Bt ‘Secgg
Slide 6: The Internet Can Help Streamline an Inefficient Mortgage Lending Value Chain
Business Overview - Lending Like Other Industries, the Internet Can Help Streamline an Inefficient Mortgage Lending Value Chain Consumers eon ae a Oe E h
Slide 7: An Efficient Exchange Between Consumers and Lenders
Bi iness Overview - Lending By Creating an Efficient Exchange Between Consumers and Lenders. "(Consumer Demand) Lender Supply } — ee Ea
Slide 8: A Simple and Understandable Process
Business Overview - Lending A Simple and Understandable Process. Filter: Consumer Access ‘Loan Offer Communication and Consumer Acceptance ° Le dinglree
Slide 9: A Simple and Understandable Business Model
Business Overview - Lending A Simple and Understandable Business Model. Loan Request Dfter Communication and Consumer Acceptance
Slide 10: Loan Pricing Structure is Aligned with Consumer and Lender Goals
Business Overview — Lending Loan Pricing Structure is Aligned with Consumer and Lender Goals. Standard Fees for Loan Products Morigage Home Equity Auto Personal Transmit Fees $10.00 $10.00 $1.00 $4.00 Closed LoanFees $300.00 -$750.00% $275.00 $108.00 $80.00 Tet Fc re tnd on rn 10.0 an ty 2120022000
Slide 11: Leading Lending Exchange; Competition Primarily Offline Players
Business Overview — Lending LendingTree is the Leading Lending Exchange and Competition is Primarily with Offline Players. Old Landscape (4999) New Landscape (2002) Exchanges /| * Creditland —. ype + LendingTree Referral | Homose: Loautrader + Get Smart Sites * Mortgage Bid | yeqpre + GetSmart _* Le
Slide 12: Agenda
LendingTree, Inc. Agenda * Business Overview - Lending ¢ Business Overview — Real Estate * Operating & Financial Results * Long-Term Financial Projections B LendifigTree
Slide 13: The Real Estate Market is Very Large
Business Overview — Real Estate The Real Estate Market is Very Large ee ee oT 99899 oD nO Broker Commissions (8 in billion wn" we 200 2H 202 Savee: OS Barca fhe Cosas, Consmuction Raps Source: US Bureau of Beonomies ~ Table 5.6024 Quarter 2002 LendingTree
Slide 14: Highly Fragmented with over 80,000 Brokerage Companies
Business Overview — Real Estate and Highly Fragmented with over 80,000 Brokerage Companies and 860,000 REALTORS® REALTOR® Breakdown (% of total) Prudential RE/MAX 5% 9% GMAC 3% NRT 6% Century 21] 13% Corawen | Cendant Banker 9% ERA Other 51%
Slide 15: Consumers More Inclined to Find a REALTOR on the Internet
Business Overview — Real Estate Consumers are 7.3x More Inclined to Find a REALTOR® on the Internet than Originate a Loan, Highlighting the Real Estate Opportunity for LendingTree. the Internet to Facilitate Real Estate Transactions Fin Jones Preview homes Find agent Access Fhaneng Fad RealEstate Co
Slide 16: Realty Services is an Efficient Exchange Between Consumers and REALTORS
Business Overview — Real Estate Realty Services is an Efficient Exchange Between Consumers and REALTORS® LendifigTree Exchange Consumer Demand Realty Services Realtor Supply Lenigiee ee Cs Cee | a | C=) anos | [——]<— a—> Ca) Cc aa [5 Franiin —,, ii ee en ” Lendifigiree
Slide 17: How LendingTree Makes Money in Real Estate
Business Overview — Real Estate How LendingTree Makes Money in Real Estate. Assume Home Price = $225,000 One Sided Transaction (Buy or Sell) Double Sided Transaction (Buy and Sell) Total Commission G Lending ree Net Revere $2,725 ‘Note: Mlustrated consumer rebate is for the LendingTree. com channel.
Slide 18: Significant Brand Awareness
Business Overview — Summary LendingTree Has Achieved Significant Brand Awareness That Can Be Leveraged for Both Real Estate and Lending. LendingTree Total Brand Awareness e008. 0% m0% 500% 00s. 500. 20% 006: 2008: 2006. 1008. 008: Yer Year? Yeurd Saati pa ay ont
Slide 19: Agenda
LendingTree, Inc. Agenda * Business Overview - Lending + Business Overview — Real Estate * Operating & Financial Results * Long-Term Financial Projections a LendifigTree
Slide 20: Exchange Volume Has Grown Substantially
Operating & Financial Results — Lending Exchange Volume Has Grown Substantially Ee WO quan guawangugranangngaanan
Slide 21: Real Estate QFs Continue to Grow
Operating & Financial Results — Real Estate and Real Estate QFs Continue to Grow, with Close Rates Steadily Improving. Reatty OFs 6 0005) gu gw an gn gn gn an gr en an aH gn gn am ae gH gn ae ge ‘exe: Commenced Rect Beate buss i Setetber 2000 B LendifigTree
Slide 22: Top Line Continues to Grow
Operating & Financial Results - LendingTree Top Line Continues to Grow... (nmin) eam quam | eam | ez | Qe | U2 @m @IM2 | QOD | aM LendingTree
Slide 23: The Path to Significant Profitability is Clear
Operating & Financial Results - LendingTree and the Path to Significant Profitability is Clear. $0.19 $0.18 12 $0.20 $0, e2ewaeeaa e ot 00 00 00 o G1 O1 O Or o2 O2 w 02 3
Slide 24: Agenda
LendingTree, Inc. Agenda * Business Overview - Lending + Business Overview — Real Estate * Operating & Financial Results « Long-Term Financial Projections a 26 LendifigTree
Slide 25: Long-Term Financial Projections
Long-Term Financial Projections LendingTree Expects to Produce Significant Revenue and Earnings Growth. 2007 Financial Goals CAGR Estimate 2002 - 2007 After-Tax EPS $2.00 70% EPS Growth Rate (Post 2007) 30% - 50% Ate TorEPS ite: Due 2s ity» comyruadkiserical NOL, FREB dow w! enya v yaytxe unt te 208
Slide 26: Combination with USAI Could Yield Numerous Synergies
Long-Term Financial Projections Our Combination with USAT Could Yield Numerous Synergies. + More Efficient Media Buying + Improved Distribution + Realty Services Offerings Linked to USAI Properties + Loan Centers on USAI Properties + Incremental Capital and Investment + Accelerate Realty Services pr
Slide 27: LendingTree Business & Financial Overview
This presentation shall not be deemed to be an offer or a solicitation of an offer to buy any securities of LendingTree. LendingTree Business & Financial Overview Friedman, Billings, Ramsey & Co. 7th Annual Growth Stock Conference May 28, 2003
Slide 28: Supplemental Data
Supplemental Data Lendifigiiee
Slide 29: Common Questions: Rising Interest Rate Impact
Supplemental Data Common Questions About LendingTree’s Business Model Are: Question Response + How will volume be impacted in + As an exchange, we anticipate a arising interest rate series of dynamics that will take environment? place in a rising interest rate environment: + Refinance loan requests
Slide 30: Managing Mortgage Product in Different Interest Rate Environments
Supplemental Data LendingTree Has Successfully Managed its Mortgage Product in Different Interest Rate Environments. Low/Declining Interest Rates — High/Increasing Interest Rates - Low/Declining Interest Rates - 04 2001 2 2002 Qt 2003 | Completed QFs \ | completed QFs Completed QF \ 100 QFs \ 55 QFs
Slide 31: Common Questions: Close Rate Trends
Supplemental Data Common Questions About LendingTree’s Business Model Are: Question Response + Why are close rate trends a key + Since customer acquisition costs are metric for the business and what already incurred to attract do they show? consumers, close rates have a significant impact on the ups
Slide 32: Common Questions: Growing Purchase Mortgage Business
Supplemental Data Common Questions About LendingTree’s Business Model Are: Question Response + How will LendingTree continue + There are several key drivers of to increase the purchase Purchase mortgage growth: mortgage business when refinance volume hegins to diminish? : ‘Volume initiatives Lender
Slide 33: Key Drivers of Purchase Mortgage Growth
Supplemental Data There are Several Key Drivers of Purchase Mortgage Growth That Will Help Offset the Decline in Refinance Volume. Volume Initiatives: LendingTree will drive purchase mortgage volume to partially offset the loss of refinance. We have several volume initiatives in place to do that and
Slide 34: Common Questions: Dependence on Real Estate Listings
Supplemental Data Common Questions About LendingTree’s Business Model Are: Question Response + How dependent is LendingTree + LendingTree’s business model is on Real Estate listings? not dependent on Real Estate listings as we do not directly monetize them. Home listings are being made available to
Slide 35: LendingTree, Inc. Balance Sheets
Supplemental Data LendingTree, Inc. Balance Sheets Gintewons) ard, Jmest, — Sqtebe a) Demers, | ards, ae 7 a 7 ASSETS (adh ch gains Str Tam aed Sha-Tem Fesritedbmemats fa ae a a od decontsRcebh at Best os 1e10 ian 218 Sarmare et 22 15 128 3S p14 Targhee et Shee 201 16 10 73 (her oats i a TOTAL ASSED
Slide 36: Analyst Coverage
Supplemental Data Analyst Coverage Firm Name Strong Buy Buy Hold Merrill Lynch 6 Friedman, Billings, Ramsey @ UBS Warburg Cj Putnam, Lovell 6 Citigroup a) e IMP Securities [) Chigrouy Fas Line Raving on TRIB » LendingTree
Slide 37: LendingTree Business & Financial Overview
This presentation shall not be deemed to be an offer or a solicitation of an offer to buy any securities of LendingTree. LendingTree Business & Financial Overview Friedman, Billings, Ramsey & Co. 7th Annual Growth Stock Conference May 28, 2003
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