Zigup Plc · LSE:ZIG
Zigup — Investor Presentation (September 2024)
43 slides from Zigup's investor presentation, September 2024
Slide 1: Spanish CME
N@RTHGATE Renting Flexible PART OF + ZIGUP
Slide 2: Introduction
Introduction. Philip Vincent
Slide 3: Agenda
Agenda. CME Introduction Philip Vincent Business overview Jorge & Roberto Operational spotlights Leadership team Jorge Alarcon Roberto Maestro Pedro Carrascal Managing Director Chief Financial Officer Human Resources Director Branch tour Begoña López Case studies Leadership team Wrap-up Ross Hawley
Slide 4: Introduction: Plan for the day
Introduction. Plan for the day. Confirmations. • First time analysts visit Spain • No new guidance today • Showcase our capabilities • AGM statement: outlook unchanged • Understand market dynamics • Meet the broader management team • Understand innovation & growth plans • Visit a branch & understand
Slide 5: Spain in its Group Context
Spain in its Group Context. Total fleet Group EBIT. >65,100 51% of Group People 23% 35% >1,300 16% of Group 42% Locations 32 17% Spain UK&I C&S of Group 5
Slide 6: 44 years in the Spanish rental market
44 years in the Spanish rental market. Acquisition of Launch of Open Launch of B2C New Group name: Opening in New brand for vehicle disposal: Record Workshops business line ZIGUP Spain Northgate Ocasión 1980 2006 2017 2020 2021 2024 Our track record: 2004 2011 2018 2020 2024 Acquisition of Fualsa No
Slide 7: Leveraging expertise across the Group
Leveraging expertise across the Group. Strategy OEM relationships Customer introductions Procurement Operations Sustainability 7
Slide 8: Market characteristics
Market characteristics. Jorge Alarcon
Slide 9: Vehicle vs rental market profile
Vehicle vs rental market profile. Total vehicle park Age of Total vehicle park (years) Market Profile. 14,2 Total no. vehicles 30.1m 13,9 13,5 • Fleet age above historic - of which LCVs 13.4% 13,1 12,7 average due to Covid supply 12,4 challenge Av age vehicle park 14.2 yrs • Rental remains a lower %
Slide 10: Positive trends for rental market in Spain
Positive trends for rental market in Spain Total Park and % y-o-y registrations % of rental registrations Rental Market (000 vehicles) 27,1% 26,9% 17% 25,5% 50 9% 20% CAGR 903 45 7% 10% + 8,6% 40 0% 35 -4% 20,4% 20,5% -8% 0% 30 25 30,1m -10% 552 Total Vehicle Park 17,2% 17,3% 20 27,5m Flexible 15 CA
Slide 11: A differentiated & national offering at scale
A differentiated & national offering at scale. hours days weeks > 1 month >24 months Car Sharing Rent-a-car Flexible Rental Minimum Term Rental Large competitors Banks Local, small competitors OEMs Digital brokers Competition in rental • Min Term led by traditional leasing companies, followed by ban
Slide 12: Business overview
Business overview. Jorge Alarcon & Roberto Maestro Saiz
Slide 13: Rental Value Chain: unique capability at scale
Rental Value Chain: unique capability at scale. Vehicle Purchased Vehicle Rentals Service & Maintenance Bodyshop Service Vehicle Disposal • >65,000 vehicle fleet • Core offering: flexible rental • Service, maintenance & • Bodyshop repairs for own • Ocasion: retail sales of quality including passenge
Slide 14: Service at scale is the key competitive advantage
Service at scale is the key competitive advantage JA • Vehicle range: flexible & appropriate SUITABLE FLEET • Quality: well-maintained vehicles • Availability: nationwide profile SERVICE • Objective advisory: trusted partner What do customers Most important understand by COMMERCIAL SUPPORT • Dedicat
Slide 15: Vehicle supply: balancing TCO and market demand
Vehicle supply: balancing TCO and market demand Fleet Profile OEM Portfolio • Main criteria: TCO – Total Cost of Ownership • Broad range of strategic partnerships 30% • Development of new OEMs providing 25% new Cars vehicles in the last 3 years + ongoing contacts with 70% additional OEMs to identify
Slide 16: Fleet sourcing is aligned with customer requirements
Fleet sourcing is aligned with customer requirements. 2020-2022 2023-2024 • COVID & supply crisis: limited replacement and so increased • Supply started to normalized in early 2023 significantly fleet age • Allowed replacement and so fleet age reduction to reach a balance • Market-driven situation r
Slide 17: Diversified high quality customer base
Diversified high quality customer base. % Fleet by Customers' End Market • Wide and differentiated customer base: predominantly serving private sector B2B channel; growing B2C offering. c14.000 customers Others ~10% Construction • Balanced size mix: from large corporations >70 vehicles, to entrepren
Slide 18: Broad network focussed on customer service
Broad network focussed on customer service. Presence in Spain 28 Service & maintenance 28 46 15 Bodyshops 675 225k 76% 560 2300 Rental Locations Repair Centres 3 Points of service (POS) Technicians Operations In-house Vehicles repaired Agreements with yearly operations daily External W/S and B/S • 2
Slide 19: Strong financial performance
Strong financial performance. • VOH growth leveraging on strong positioning in flexible and positive market trend • Vehicle purchase recovery in FY24 in most of vehicle categories • Reflected in EBIT increase (x2.4 vs FY21) • Rental business growth (x1.7 vs FY21) and rental margin up to 18.2%. Main
Slide 20: Financial analysis
Financial analysis. Pricing. Cost Profile. Margin profile vs UK&I. • ROCE – based pricing approach • Depreciation main cost input. • More concentrated geog profile of Currently reflecting fleet refresh sites/customers • Flex: yearly inflation increases and growth, will normalize in (January) • Light
Slide 21: Well-positioned in attractive market
Well-positioned in attractive market. ✓ Growing but still low penetration of rental vs ownership ✓ Unique proposition centred on customer excellence ✓ Leading market position with nationwide scale ✓ Experienced operational capabilities ✓ Strong OEM relationships ✓ Diverse and growing customer base ✓
Slide 22: Q&A - Market
VEHICULOS DE OCASION LECCIONADOS
Slide 23: Operational Spotlights
Operational Spotlights. Jorge Alarcon & Leadership team
Slide 24: Customer-centric organization
Customer-centric organization Central Services Branch Customer Branch Service Centre Branch • Fleet purchasing and Branches & Points of Service management • Logistics • Procurement Service Excellence • KAMs 360º customer view • Sales team for local customers • Desk office: attention to customers •
Slide 25: Sales and Marketing
Sales and Marketing. Sales Proposition Marketing Support National Accounts SME/ Entrepreneurs • Digital advertising campaigns (lead generation) • Annual RFQs • Contracts on demand • Lead qualification & customer service • Mainly Flexible (75%) • Consultative selling: Flexible, Min • Research and cal
Slide 26: Strong public profile: media channels & industry awards
Strong public profile: media channels & industry awards. Tv campaign Industry awards 26
Slide 27: Fleet management
Fleet management. OEMs Vehicle Sourcing and logistics Managing Defleets • Yearly negotiations: • Maintain UTS at target level • Mileage / Age / Reparability • Terms of purchasing (c.91%) criteria • Indicative volume • Ongoing vehicle orders for • Some flexibility depending on • After sales terms rep
Slide 28: Disposal channels: all in-house
Disposal channels: all in-house. “Northgate Ocasión” (NGO) “Trade” Market dynamics • Low mileage and low damaged • Remaining vehicles with high mileage • Demand remains strong for vehicles or damage young CDVs (our core vehicle) • Buyers mainly private individuals • Customers are professional trader
Slide 29: High potential from modern locations: 4 in 16mths
High potential from modern locations: 4 in 16mths. New Location criteria New Location requirements Access to local Current service heat-map & Yards % operational saturation Easy road Near big employees with the opportunities for growth of current workshops access cities required qualifications 2x Ne
Slide 30: Customer-facing teams supported by central functions
Customer-facing teams supported by central functions. 1384 Total headcount Sales and marketing Operational Central services 51 Directors + managers Customer Service Back-office and 154 Middle manager and chiefs management 675+504 Technicians, sales support, analysts Technicians Recruiting Rewards Tr
Slide 31: Growth opportunities
Growth opportunities. Jorge Alarcon
Slide 32: Future Business development
Future Business development. Market trends Growth axes • Growing rental market • Core in Spain • Digital and flexible mobility • Products and Services • Non-core processes outsourcing around the core • Sustainability • Adjacent markets • Technology enablement Our core assets Efficiency axes • Market
Slide 33: Potential Growth opportunities
Potential Growth opportunities. Assets light/heavy Size Requires Organic Inorganic Expand core business Heavy New branches/Service points ✓ ✓ Special vehicles Heavy New vehicle categories & rental terms ✓ ✓ Extend B2C Heavy Marketing ✓ ✓ ✓ products 3rd Party W/S and B/S Light Increase capacity & ser
Slide 34: Main efficiency opportunities
Main efficiency opportunities. Embedded culture Continuous improvement approach to efficiencies & inflation mitigation Inorganic/ Saving Size Requires Organic External ✓ Improve customer service Technology + Project management Digitalization / AI and back-office efficiency Telematics Reduce operatio
Slide 35: Q&A - business
Q&A - business. Leadership team
Slide 36: Site visit overview
Site visit overview. Leadership team
Slide 37: Los Olivos: Site overview
Los Olivos: Site overview 65 Total headcount c.3,000 Rentals managed 8,500 Repairs in 12 months 28 CUSTOMER DESK Vehicles received daily VEHICLE SALES 8th Branch in Spain per vehicle rented 37
Slide 38: Los Olivos: Visit focus
Los Olivos: Visit focus. Topic 1: Technology Topic 2: Parts & Bodyshop Topic 3: Sales • Tyre testing • Parts management • Customer Reception • EV management • Paint ovens • Ocasion sales offering • SMR • Other technologies 38
Slide 39: Case Studies & ESG
Case Studies & ESG. Leadership team
Slide 40: Site Tour: Case Studies
Site Tour: Case Studies. Green parts Double shifts Smart queue Enhanced paint efficiency • 4,825 spare parts in FY24 • Reduction of outsourcing • Improvement of • New supplier allows and cost improvement customer experience precise control of • 2 central warehouses, consumption 4 dismantlement • Low
Slide 41: ESG: Actions implemented
ESG: Actions implemented. Solar panels in 17 branches Installed Capacity: Production capacity: CO2 emissions saving: 1,092 kWp 1.5 MW/year 243,000 kg / year Charging points in 26 branches 138 13,900 CO2 emission saving: Charging Re charges since 163,000 kg since points installation installation Stra
Slide 42: Key Takeaways
Key Takeaways. Philip Vincent
Slide 43: Further Information
RH Wrap up Corporate Website & Further Information. Ross Hawley