Slide 1: Interim Results July 2013
Interim Results July 2013 Saving UK Households £1bn
Slide 2: Interim Summary
Interim Summary Gerald Corbett Chairman
Slide 3: Summary interims
Summary interims Strong trading results; increased dividend and strengthened leadership team • Strong trading results • Revenue +10% to £112.3m • Increased dividend • Special dividend 12.92p per share paid on 26 July 2013 • Increased liquidity • Simon Nixon sell down to below 30% • Strengthened boar
Slide 4: Finance Update
Finance Update Paul Doughty CFO
Slide 5: Summary financial highlights
Summary financial highlights Strong trading results; special dividend and interim dividend increased by 20% • Strong trading results • Revenue +10% to £112.3m (+7% excl. MSE) • EBITDA +29% to £39.9m (+9% excl. MSE) • H1 operating margins 36% • MSM margin improved slightly • Impact of MSE • Continued
Slide 6: Strong trading results
Strong trading results Operating margins increased MSM MSM MSE Group H1 2013 H1 2012 Variance H1 2013 Consol. H1 2013 Variance £m £m % £m Adjs £m % Revenue 109.4 102.3 7% 8.8 (5.9) 112.3 10% Gross Profit 78.1 73.4 6% 8.7 – 86.7 18% Gross Margin 71.4% 71.7% 98.6% 77.2% Administrative Costs (28.4) (25
Slide 7: Adjusted EBITDA
Adjusted EBITDA Group EBITDA +29%; EBITDA margin 36% £6.2m £5.1m £0.9m (£0.4m) (£0.2m) (£0.5m) (£1.0m) (£1.3m) Restated: £39.9m £31.0m +£2.3m MSM Gross Profit £28.7m MSM Cost Base +£1.9m +£4.7m H1 2012 Volume Margin Staff costs Third party Offline Other admin Irrec VAT MSE H1 2013 resource media EBI
Slide 8: Direct to site share of revenues maintained
Direct to site share of revenues maintained DTS revenues +£5m; Offline media spend -6% Revenue by source Revenue by vertical 120 2.9 9.2 100% 100 7.1 4 6.7 MSE 11 12 3.7 6.4 22 11.2 Travel 80 24 22 21.5 21.0 Home Services / Other 60 Money - non credit Partners Money - credit SEM 40 66 66 74 65.5 Ins
Slide 9: Insurance H1 2013
Insurance H1 2013 Good revenue growth, slowing into Q2 • Revenues +11% against last year • Growth across each of the major product lines • Q2 revenue growth slowed • Increased offline expenditure by competitors – new campaigns • Google algorithm changes in June • Other revenues £1.0m (13%) ahead of
Slide 10: Money H1 2013
Money H1 2013 Structural impact of Funding for Lending scheme continues • Revenues -13% over H1 2012 • Structural impact of Funding for Lending scheme continues • Credit revenues 2% ahead in H1 • Non credit revenues 43% decline in H1 • Provider budgets and availability of product remain solid outsid
Slide 11: Home Services H1 2013
Home Services H1 2013 Strong growth in Energy revenues • Revenues +84% ahead of H1 2012 • Utility switching volumes increased from Cheap Energy Club in connection with MSE • Visitors -18% against H1 last year • Lower visitor volumes from shopping and vouchers targeted • RPV +125% • Sales and visitor
Slide 12: Travel H1 2013
Travel H1 2013 Trading continues to improve • Revenues +30% on H1 2012 • Package Holidays, Hotels and Car Hire growing • Continue to see opportunity for growth in Travel • Investment over the next 12 months H1 2013 H1 2012 Variance Variance % H2 2012 Travel Visitors ('m) 29.2 22.6 6.6 29% 21.6 Trans
Slide 13: MoneySupermarket marketing investment
MoneySupermarket marketing investment Efficiency maintained FY 2011 FY 2012 H1 2012 H1 2013 £m % £m % £m % £m % Online 50.5 65% 55.1 68% 28.8 62% 31.3 69% Offline 27.0 35% 26.0 32% 14.5 34% 13.9 31% Total spend 77.5 81.1 43.3 45.3 Revenue 177.8 203.0 101.8 109.3 Marketing margin % 56% 60% 57% 59% •
Slide 14: MoneySavingExpert.com
MoneySavingExpert.com Good H1 Results • MSE continues to trade well • £8.8m revenues (£2.9m contribution to Group) • £6.2m EBITDA • Trading trends similar to MoneySupermarket • Money – Funding for Lending • Home Services – Cheap Energy Club • Good progress with operations plan • Infrastructure capac
Slide 15: Cash
Cash Cash generation remains a key strength of the business • Cash balances of £25.4m at 30 June 2013 • Circa 110% of EBITDA converted to cash • Special dividend of £70m paid 26 July £1.1m £13.4m (£1.4m) (£2.3m) £1.7m £24.2m (£7.9m) £25.4m (£22.0m) £18.7m Cash at Adj. Op. Profit Deprec'n Amortis'n P
Slide 16: Dividends
Dividends Interim dividend +20% to 2.16p; special dividend of £70m paid 26 July 2013 Dividend – p/share 2013 2012 2011 Interim 2.16 1.8 1.5 Final 3.94 3.03 Total Dividend Declared 5.74 4.53 Special Dividend 12.92 3.93 TOTAL 5.74 8.46 • Progressive dividend policy • Interim dividend increased by 20%
Slide 17: Summary
Summary • Solid start to the year • Revenues +10% • EBITDA +29% • MoneySavingExpert.com has continued to perform well • Cash generation remains strong • Converting circa 110% EBITDA to cash • Interim dividend +20% to 2.16p per share; special dividend of 12.92p per share. 17
Slide 18: Business Update
Business Update Peter Plumb CEO Kenny Jacobs CMO
Slide 19: H1 Performed well
H1 Performed well Strong trading results; revenue +10% and EBITDA +29% • Brands in good health • Markets are growing • Insurance, Energy, Travel • Money impacted by Savings structural change • H1 Investments delivered against milestones • Best Shop Strategy: Energy, Travel Insurance and TravelSuperm
Slide 20: Motor Insurance mobile payment journey
Motor Insurance mobile payment journey Pioneering a seamless search and purchase journey for mobile Mobile Web/App Search results Check policy Buy policy Old journey clicked through to provider site 20
Slide 21: Marketing Strategy
Marketing Strategy Kenny Jacobs CMO
Slide 22: Emphasis on the customer experience
Emphasis on the customer experience Evolving our model to increase conversion and retention Marketing levers Marketing model 100% 4 Partners 22 Paid Search Customer Loyalty Natural ACQUISITION CONVERSION RETENTION Search of visitors of enquirers of customers CRM 74 Customer Insight Brand Social 0% H
Slide 23: Search is changing, we will adapt
Search is changing, we will adapt Update on latest natural search algorithm change Marketing levers Search sources Site optimised Partners Paid Search Natural Search CRM Brand Social 23
Slide 24: Retention makes it easier for customers
Retention makes it easier for customers Using the data we have to drive retention, trust and loyalty Marketing levers Re-buy email Cross-buy email Partners Paid Search Natural Search CRM Brand Social 24
Slide 25: Marketing roadmap for H2 and beyond
Marketing roadmap for H2 and beyond More ways to save, we make it easy to save Marketing levers Partners • New campaign for MoneySupermarket from August Paid Search Natural • New campaign and site for TravelSupermarket Search CRM • The most trusted brand Brand Social 25
Slide 26: MoneySupermarket share holds strong
0.00% 10.00% 20.00% 40.00% 50.00% 60.00% 30.00% 8/1/2009 9/1/2009 10/1/2009 11/1/2009 12/1/2009 1/1/2010 Beat That Quote 2/1/2010 moneyextra.com 3/1/2010 4/1/2010 5/1/2010 6/1/2010 7/1/2010 8/1/2010 9/1/2010 10/1/2010 11/1/2010 12/1/2010 Compare the Market 1/1/2011 MoneySupermarket.com 2/1/2011 3/1/
Slide 27: Markets all have attractive headroom
Markets all have attractive headroom Group has long term structural growth across core channels Switched/ On-line Avg Mkt Switched/ Policies/Products (m) New CAGR % Customer New Online 11 - 13 Saving Motor Ins 24 10.5 8.5 6% £398 Home Ins 18 4.7 2.6 18% £104 Travel Ins 26 20.4 8.8 7% £34 Savings 63
Slide 28: Outlook
Outlook July is trading flat against a strong 2012 • Group revenues • MoneySupermarket: slightly behind last year against tough comps • July 2012 – new campaign pre-Olympics • TravelSupermarket: strong growth • MoneySavingExpert: good growth • Trading trends inline with June • Headwinds: Funding for
Slide 29: Questions & Answers
Questions & Answers Save money, Feel qyeat.
Slide 30: Appendix
Appendix Additional Financial Materials 30
Slide 31: Adjusted EBITDA
Adjusted EBITDA Reconciliation from stat. revenue and operating profit to adjusted EBITDA H1 H1 H2 FY 2013 2012 Var. Var.% 2012 Var. Var.% 2012 Revenue 112.3 102.2 10.1 10% 102.6 9.7 9% 204.8 Gross Profit 86.7 73.3 13.4 18% 78.4 8.3 11% 151.7 Margin % 77% 72% 76% 74% Administrative costs (50.6) (45.
Slide 32: Adjusted cost base
Adjusted cost base H1 2013 v H1 2012, H2 2012 H1 2013 H1 2012 H2 2012 £m £m Variance Variance % £m Variance Adjusted Cost Base* Staff Costs 18.4 16.5 1.9 12% 18.3 1% IT Contractors ** 1.1 0.0 1.1 n/a 0.6 n/a Depreciation 1.7 1.8 -0.1 -4% 1.8 -4% Irrecoverable VAT 4.4 3.2 1.3 40% 3.4 29% Other Admin
Slide 33: VAT 2012
VAT 2012 New Partial Exemption Special Method (PESM) • A number of the group’s services are classified as exempt (for VAT purposes) • Restricts the proportion of input VAT incurred on expenses (e.g marketing) that may be recovered by the Group • Recoverable proportion calculated by reference to a PE
Slide 34: Statutory balance sheet
Statutory balance sheet June 2013 December 2012 June 2012 £m £m £m Intangible assets 185.2 197.6 148.8 Other non-current assets 11.4 11.7 11.5 Net current liabilities (52.4) 6.4 20.0 Long term liabilities (19.7) (16.0) (19.9) Net assets 124.5 199.7 160.3 • Intangible assets include £55m of goodwill
Slide 35: Accounting information
Accounting information Tax • Tax charge of £4.7m giving effective rate of 23.8% • Close to the applicable statutory tax rate for 2013 of 23.25%. • Reduction in applicable statutory rate of corporation tax from 24.5% in 2012, to 23.25% in 2012. • Vesting of the 2010 LTIP scheme in H1 2013 will give r
Slide 36: Earnings per share calculation
Earnings per share calculation H1 2013 H1 2012 £m £m Statutory profit before tax 19.8 11.6 Amortisation of MSFG Intangibles 11.5 11.5 Amortisation of FSN Intangibles 0.0 0.4 Amortisation of MSE Intangibles 0.9 0.0 LDD Deferred consideration 0.0 0.1 Costs relating to MSE acquisition 0.0 2.7 MSE conti
Slide 37: KPIs – by vertical
KPIs – by vertical H1 H1 H2 2013 2012 Var 2012 Var Money Visitors ('m) 22.7 22.0 4% 18.5 23% Transactions ('m) 10.5 12.2 (14)% 9.2 15% Revenue (£m) - Click-based 26.5 30.3 (12)% 23.5 13% Revenue (£m) - Total 27.9 32.2 (13)% 25.2 11% RPV £1.23 £1.47 (16)% £1.36 (10)% RPT £2.53 £2.48 2% £2.56 (1)% Ins
Slide 38: KPIs – MSM
KPIs – MSM H1 2013 H1 2012 Variance % H2 2012 Variance % Visitors ('m) 82.2 75.2 9% 70.9 16% Transactions ('m) 37.1 36.8 1% 30.6 21% Click Revenue (£m) 100.7 92.0 9% 91.4 10% Other Revenue (£m) 8.6 9.9 -12% 9.0 -5% Total Revenue (£m) 109.3 101.8 7% 100.4 9% RPV £1.33 £1.35 -2% £1.42 -6% RPT £2.71 £2