Prosus N.v. Class N · EURONEXT:PRX
Prosus N.v. Class N — H1 FY2022 Earnings Presentation
48 slides from Prosus N.v. Class N's earnings presentation, November 2021
Slide 1: Detailed Financials
Detailed Financials For the six months ended 30 September 2021
Slide 2: Important information
Important information This report contains forward-looking statements as defined in the United States Private Securities Litigation Reform Act of 1995 concerning our financial condition, results of operations and businesses. These forward-looking statements are subject to a number of risks and uncer
Slide 3: Operations
Drosus Operations
Slide 4: Classifieds: Strong operational recovery
Classifieds: Strong operational recovery • Key trends continue to shape the A global classifieds OLX Group Classifieds: Average revenue/ industry, such as consumers’ acceptance leader and innovator internet user (ARPIU)1,2 monetisation countries (US$) of fully digital solutions, verticalisation of p
Slide 5: Strong growth as mature markets invest in their ecosystems
Strong growth as mature markets invest in their ecosystems Avito: • Substantial revenue growth was driven by high demand (MAU’s grew 13% to 92m) in all verticals, especially jobs and Europe services, and price increases in jobs and goods. Paying listers was flat but frequency of paid transactions in
Slide 6: OLX Autos: Developing a large-scale car transaction business
OLX Autos: Developing a large-scale car transaction business • OLX Autos is scaling its end-to-end car # Vehicles transacted (‘000)1: transaction business in Asia, Latam, Turkey and the US, where car consumers 87% and dealers can access secure, trusted and frictionless transactions. • OLX Autos has
Slide 7: Strong food delivery growth opening additional opportunities
Strong food delivery growth opening additional opportunities Operations in 64 high growth markets Orders (‘m)1 • Food delivery continued to gain traction with 70% and 73% YoY growth in orders 70% and GMV despite very high YoY comparisons. • Our strategy is to leverage leading positions to develop an
Slide 8: Food Delivery: iFood continues to deliver as market normalises
Food Delivery: iFood continues to deliver as market normalises • After a stellar FY21 where orders Orders (‘m)1 Restaurant partners (‘000) doubled, iFood’s order growth remained strong at 43% YoY. 43% 26% • GMV grew faster than orders at over 50%, driven by higher volumes and an 361 309 increase in
Slide 9: Food Delivery: Delivery Hero and Swiggy growing strongly
Food Delivery: Delivery Hero and Swiggy growing strongly Delivery Hero (DH): • DH continued to deliver strong structural growth while pursuing M&A opportunities and accelerating investment in strategic Present in more than 51 markets globally A leader in India expansion like quick commerce. • DH imp
Slide 10: Payments & Fintech: Strong growth globally, driven by India
Payments & Fintech: Strong growth globally, driven by India • India delivered strong growth in 20 High growth markets Number of Transactions (‘m)1,2 transactions1 (+53% YoY) and TPV (+70% YoY) as the ecommerce and GPO 45% financial services verticals continued to grow while travel recovered slightly
Slide 11: Edtech: Disrupting and Augmenting traditional education
Edtech: Disrupting and Augmenting traditional education • The education market is expected to K-12 Enterprise/Vocational reach US$10tr by 20301 and is ripe for disruption by technology, which will help overcome major barriers, like access, capital constraints and reach. Supplemental Study/homework E
Slide 12: Etail: Strong base allowing scaling of geographies and verticals
Etail: Strong base allowing scaling of geographies and verticals eMAG GMV (US$’m)1 • eMAG grew at a healthy 4% YoY, with GMV almost double pre-Covid-19 levels. 6% (4%) • Customer adoption of Genius, eMAG’s premium subscription program, is rising and projected to gain additional adoption 1 233 with t
Slide 13: Ventures: Developing future growth potential
Ventures: Developing future growth potential • Prosus Ventures invests in early stage businesses with the potential to disrupt large markets. Prosus Ventures has a track record of Logistics & Mobility Ecommerce • identifying and backing highly successful businesses, illustrated by the evolution of F
Slide 14: M&A
Drosus M&A
Slide 15: Core segments strengthened with M&A
Core segments strengthened with M&A • Prosus invested US$5.2bn in 1H FY22 Investment to scale our core segments (1H FY21: US$0.6bn). Significant investments include: • Stack Overflow (US$1.7bn) • Delivery Hero (US$936m) • Skillsoft (US$500m) US$5.2bn • Swiggy (US$274m) • GoodHabitz (US$258m) • Pharm
Slide 16: Financials
Drosus Financials
Slide 17: Summary financials: Strong growth with investment
Summary financials: Strong growth with investment Revenue (US$’bn)1,2 Trading profit (US$’bn) 1,2,3 31% (29%) 8% (8%) 16.6 2.7 2.9 12.7 1H FY21 1H FY22 1H FY21 1H FY22 Core HEPS (US¢)3 Free cash flow (US$’m) 7% -68% 139 148 370 118 1H FY21 1H FY22 1H FY21 1H FY22 1 Results reported on an economic-in
Slide 18: Ecommerce revenue growth sustained above 50%
Ecommerce revenue growth sustained above 50% • Ecommerce revenue growth accelerated Ecommerce revenue growth by core segments (%)1 to 53%, supported by the core segments to a total of US4.2bn in Ecommerce 1H FY21 revenue for 1H FY22. 141% 1H FY22 • Classifieds made a significant recovery from the to
Slide 19: Driving profitability in mature businesses while investing for growth
Driving profitability in mature businesses while investing for growth • Ecommerce trading loss margin Ecommerce trading margins by core segments (%)1 decreased by 1p.p., with the trading loss increasing from US$214m in 1H FY21 to 1H FY21 US$372m for 1H FY22. The increase in trading loss was due to h
Slide 20: Classifieds emerged from the pandemic stronger with healthy growth
Classifieds emerged from the pandemic stronger with healthy growth OLX Group: Revenue (US$’m)1,2 Trading profit/(loss) (US$’m)1,2,3 • Key markets contributed to strong revenue growth supported by a strengthened transactional marketplace OLX Autos Classifieds (pay-and-ship, trust-and-safety), 107% (1
Slide 21: Food Delivery doubled revenues and improved margin with scale
Food Delivery doubled revenues and improved margin with scale • Strong revenue growth was driven by all Revenue (US$’m)1,3 Trading profit/(loss) (US$’m)1,2,3 our platforms. Our margin improved YoY despite higher investment into customer acquisition (CAC), marketing and ecosystem expansion (groceries
Slide 22: Payments & Fintech growth accelerates and credit resumes
Payments & Fintech growth accelerates and credit resumes • India’s revenue growth accelerated to Revenue (US$’m)1 Trading profit/(loss) (US$’m)1,2 55% (30% 2-year CAGR), driven by a solid recovery from the lockdown impacted H1 last year and growth from New initiatives Core PSP new segments and produ
Slide 23: Rapid revenue growth in Edtech as we continue to expand our reach
Rapid revenue growth in Edtech as we continue to expand our reach • Edtech became our newest segment on 1 Revenue (US$’m)1 Trading loss (US$’m)1 April 2021. • Edtech revenue growth accelerated from FY21, driven by a continued demand for 135% (51%) online learning across our portfolio, especially BYJ
Slide 24: Etail: Healthy core business and investment into new initiatives
Etail: Healthy core business and investment into new initiatives • eMAG had robust revenue growth of 4% Revenue (US$’m)1 Trading profit/(loss) (US$’m)1,2 YoY, which follows 1H FY21’s stellar 70% YoY growth. • eMAG is redeploying profits from its core 7% (4%) business to investments in Tazz (food del
Slide 25: Social & Internet platforms showing healthy growth
Social & Internet platforms showing healthy growth Tencent: • Tencent grew revenue 19% YoY for the Tencent revenue (RMB’m)1 VK revenue (RUB’m)2 nine months to September 2021 as it continued to enhance its services and 21% achieved healthy growth across its 19% 107 427 business lines, particularly bu
Slide 26: Segmental detail
Segmental detail1 Revenue Adjusted EBITDA2 Trading profit2 1H FY21 1H FY22 1H FY21 1H FY22 1H FY21 1H FY22 Ecommerce 2 608 4 171 (140) (276) (214) (372) - Classifieds 628 1 301 56 141 29 108 - Food delivery 610 1 261 (168) (281) (189) (312) - Payments & Fintech 252 359 (27) (27) (31) (31) - Edtech 5
Slide 27: Profitable businesses boost central cash inflows
Profitable businesses boost central cash inflows Consolidated revenue from Consolidated trading profit from Sources of free cash inflow (US$'m)2,3 • Overall central cash flows improved profitable ecommerce businesses profitable ecommerce businesses 22%, supported by Classifieds and (US$’m)1,2 (US$’m
Slide 28: Investment into groceries drove higher development spend
Investment into groceries drove higher development spend Consolidated development spend (US$’m)1 Economic interest development spend (US$’m)1 • Consolidated development spend increased YoY, mainly reflecting 62% (52%) investment by iFood in groceries, eMAG in Tazz and Freshful, and incremental 109%
Slide 29: FCF reflects investment in operations, working capital and capex
FCF reflects investment in operations, working capital and capex US$’m 1H FY21 1H FY22 • The Group’s free cash flow decreased to Adjusted EBITDA2 11 (105) an inflow of US$118m mainly reflecting: Non-cash items 46 121 − Investment in groceries in Food delivery; Working capital (including merchant cas
Slide 30: Prosus company sources of cash and commitments
Prosus company sources of cash and commitments • Dividend received from Tencent US$’m 1H FY21 1H FY22 Dividends to HoldCo (US$'m) increased 25% YoY. • Classifieds’ profitability improved, 25% enabling the dividend paid to the Cash remitted to/generated at Holdco level: HoldCo to increase 28% YoY to
Slide 31: Significant financial flexibility to execute our value creating strategy
Significant financial flexibility to execute our value creating strategy Debt maturity profile (US$’bn) Debt: • US$225m 10yr bond issued July 2015 (5.5% coupon). • US$614m 10yr bond issued July 2017 (4.85% coupon). Bond • €500m 8yr bond issued August 2020 and $1.85bn Bond €350m drawn down December 2
Slide 32: Summarised income statement
Summarised income statement • Detail on net finance cost and share of US$’m 1H FY21 1H FY22 equity-accounted results can be found on page 32 & 33. Revenue1 12 690 16 634 • Net gains on acquisitions and disposals in Less: Equity-accounted investments (10 517) (13 569) 1H FY21 includes gains of US$114
Slide 33: Finance costs
Finance costs • Interest income on our cash and short- US$’m 1H FY21 1H FY22 term investments balances decreased as short-term interest rates declined. Interest income 59 29 • Prosus raised new bonds in December 2020 and July 2021, which increased 1H Loans and bank accounts 43 24 FY22’s interest exp
Slide 34: Share of equity-accounted results
Share of equity-accounted results • The increase of US$1.2bn (+42% YoY) in US$’m 1H FY21 1H FY22 share of equity-accounted results was driven by: Tencent1 3 135 4 131 − Increased Tencent profits, despite the sale of 2% of our Tencent stake; VK1 (20) (28) − A reversal of our share of an impairment ad
Slide 35: Core headline earnings reconciliation
Core headline earnings reconciliation • Headline earnings decreased due to: US$’m 1H FY211 1H FY22 − Investment in our Ecommerce portfolio; − Higher interest paid (see page 32 for more detail); and Headline earnings from continuing operations 2 429 2 354 − Although Tencent’s contribution increased Y
Slide 36: Core headline earnings drivers
Core headline earnings drivers Incremental core headline earnings drivers, YoY (US$’m)1,2 • Core headline earnings (which excludes once-off and non-operating items such as amortisation of intangible assets recognised in business combinations, etc.) is not defined under IFRS, but is 4% (2%) aimed at
Slide 37: Contribution by associates and joint ventures
Contribution by associates and joint ventures IFRS Other Core HE • Equity-accounted results include, the 1H FY22 (US$’m) group’s share of the earnings of its results adjustments Contribution associates and JV’s, including amongst Tencent1 4 131 (1 154) 2 977 others Tencent, VK and Delivery Hero. VK1
Slide 38: Tencent's contribution to core headline earnings
Tencent’s contribution to core headline earnings 1H FY21 1H FY22 Tencent: Jun’20 Prosus’s share Tencent: Jun’21 Prosus’s share (RMB’m)1 (US$’m) (RMB’m)1 (US$’m) Tencent profit attributable to equity holders 62 003 2 716 90 354 4 044 Adjustments to get to Prosus’s core headline earnings: (2 934) (99)
Slide 39: Current assets and liabilities
Current assets and liabilities • Other investments decreased US$1 226m related mostly to the timing Current assets (US$’m) FY21 1H FY22 Current liabilities (US$’m) FY21 1H FY22 of the investment in Delivery Hero (DH) which was made over the 31 March 2021 close. The transaction was completed Inventor
Slide 40: Net asset value
Drosus Net asset value
Slide 41: Prosus net asset value as at 30 September 2021
Prosus net asset value as at 30 September 2021 Investments Shares held (m) Share price (LC)1 Value (US$’bn) Listed assets2 177.8 Tencent 2 769 461 164.3 Delivery Hero3 68 111 8.8 Remitly 37 37 1.4 VK (formerly Mail.ru) 62 21 1.3 Trip.com 33 31 1.0 Skillsoft 50 12 0.6 Skillsoft Warrants 17 3 0.05 Sin
Slide 42: Naspers net asset value as at 30 September 2021
Naspers net asset value as at 30 September 2021 Asset value at Economic Investments Value (US$’bn) 100% (US$'bn) interest Prosus NAV1,2 218.7 41.3% 90.4 Other3 1.4 50.5% 0.7 Net cash / (debt) 0.2 50.5% 0.1 Cash 0.2 50.5% 0.1 Debt (0.0) 50.5% (0.0) Net asset value (US$'bn) 91.2 Net asset value (ZAR’b
Slide 43: Appendix
Drosus Appendix
Slide 44: Prosus share capital
Prosus share capital 31 March 30 September 19 November Net total Economic Prosus (‘000) 2021 2021 2021 shares in issue3 interest4 Prosus N ordinary shares Shares in issue 1 624 652 2 073 644 2 073 644 Free float & treasury 444 402 893 394 893 394 Owned by Naspers 1 180 250 1 180 250 1 180 250 Prosus
Slide 45: Naspers share capital
Naspers share capital 31 March 30 September 19 November Net total Naspers (‘000) 2021 2021 2021 shares in issue2 Naspers N ordinary shares Shares in issue 435 511 435 511 435 511 Prosus shares held in treasury1 (15 721) (218 102) (218 102) Net shares in issue 420 240 217 409 217 409 217 409 Naspers
Slide 46: Group portfolio
Group portfolio Ecommerce Social & internet platforms Payments & Classifieds Food delivery Etail EdTech Ventures 29% FinTech 99%1 100% 94% 80% 14% 24% 27% 99% 100% 62%2 42% 24% 15% 40% 72% 27% 41% 13% 39% 91% 36% 10% 15% 99% 100% 13% 13% 14% 82% 13% 38% 10% 19%3 2%3 100% 16% 23% 62% 22% 4%3 Organogr
Slide 47: Glossary
Glossary ARPIU: Total revenue for OLX Core Classifieds monetisation countries, divided by the total number of internet users in those countries M&A: Mergers and acquisitions BNPL: Buy now, pay later MAU: Monthly active users CAC: Customer acquisition cost OCI: Other comprehensive income
Slide 48: Investor relations contact
If you require any further information, please visit our website www.prosus.com or alternatively email Eoin Ryan (Head of Investor Relations) at InvestorRelations@prosus.com