Slide 1: 2021 Interim results
2021 Interim results 29 July 2021
Slide 2: Duncan Tait, Group CEO
Duncan Tait Group CEO
Slide 3: Agenda
Agenda Strategic progress Overview of 1H21 1H21 financial details and Outlook 2021 Interim results – 29th July 2021 3
Slide 4: First half 2021 highlights
First half 2021 highlights Transforming our Continued portfolio Further strengthened digital footprint rebalancing financial position R D Omni-channel platform now Added three new Effective cash-flow live across 10 OEM markets Distribution businesses management Established our Digital Delivery Dispo
Slide 5: First half 2021 headline KPIs
First half 2021 headline KPIs Topline Profitability Cash Shareholders Revenue Operating margin Free Cash Flow Underlying EPS £3.9bn 4.1% £184m 26.7p (1H20: 0.9%) +37% £143m £435m 6.4p (Dec-20: £266m) Organic sales growth PBT Net cash1 DPS (interim) Figures are stated pre-exceptionals. 1: Excluding l
Slide 6: Gijsbert de Zoeten, Group CFO
Gijsbert de Zoeten Group CFO
Slide 7: 1H21 results: strong business performance
1H21 results: strong business performance 2021 2020 2019 H1 H2 H1 H1 Revenue £3.9bn £3.8bn £3.0bn £4.7bn Organic growth % +37% (9)% (29)% Operating margin % 4.1% 3.6% 0.9% 3.8% PBT £143m £120m £9m £156m Figures are stated pre-exceptionals 2021 Interim results – 29th July 2021 7
Slide 8: Group revenue recovering towards 2019 levels
Group revenue recovering towards 2019 levels Revenue bridge (2021 vs 2019) £0.5bn £0.2bn Distribution: +£0.2bn £0.1bn Retail: (3)% £(0.7)bn £4.7bn underlying performance £3.9bn 1H19 Net disposals Currency Organic 1H21 + M&A 2021 Interim results – 29th July 2021 8
Slide 9: Revenue trend vs 2019: positive momentum
Revenue trend vs 2019: positive momentum Organic revenue growth (vs 2019) 1H20 2H20 1H21 1% 2% (6)% (3)% (9)% (17)% vs 2020 Group +37% Distribution +33% (29)% (30)% Retail +44% (29)% Group Distribution Retail 2021 Interim results – 29th July 2021 9
Slide 10: Distribution: H1 regional revenue trends
Distribution: H1 regional revenue trends Asia Europe: £0.7bn OSG%: +27% Australasia Strong model line-up Europe supported recovery Americas & Africa Good start for JLR-Poland Asia: £0.6bn OSG%: +32% All markets positive in H1 Singapore and Hong Kong expectedly below 2019 Americas & Africa: £0.5bn OS
Slide 11: Distribution: bouncing back
Distribution: bouncing back H1 Revenue Operating profit Encouraging topline performance 6.6% £2.4bn £2.4bn £160m OSG% Profitability supported by 5.1% geographic diversification +33% 24 £1.7bn 20 £120m 30 29 2.7% 20 18 £46m 86 4 9 4 53 29 2019 2020 2021 2019 2020 2021 Americas & Africa Europe Austral
Slide 12: Retail: strong recovery
Retail: strong recovery H1 Revenue Operating profit UK and Russia both above 2019 levels £2.3bn Supported by strong margins and cost- restructuring programme £1.6bn 2.5% £1.3bn 0.9% 39 20 OSG% 0 39 4 +44% 16 0 (18) (18) (1.4)% 2019 2020 2021 2019 2020 2021 UK & Europe Australasia Asia 2021 Interim r
Slide 13: Income statement
Income statement H1 £m 2021 2020 2019 (unless otherwise stated) Operating profit 159 28 180 (pre exceptionals) Interest costs fell as we carried less inventory and interest rates Net interest & JVs (16) (19) (24) were lower PBT 143 9 156 Exceptional items: loss on disposal (pre exceptionals) of Russ
Slide 14: Continued strong cash generation
Continued strong cash generation Net cash bridge (£’m) 1H21 Free-cash flow = £184m £(5)m in 1H20 72 4 71 0 159 15 27 48 19 59 115% FCF conversion 435 266 Net Cash Operating D&A net of Working Pension/ NCI/ Net interest Net capex Net M&A Dividends Share FX / Other Net Cash @ Dec-20 profit leases capi
Slide 15: Capital allocation: new £100m share buyback
Capital allocation: new £100m share buyback 01 02 Invest in the business Dividends Capex for organic growth and Policy: 40% annual payout of basic technological investment EPS (pre exceptionals) Retain focus on portfolio optimisation Strong Interim: 6.4 pence (£25m) declared balance sheet Net debt t
Slide 16: Strategic progress
Duncan Tait Strategic progress
Slide 17: Strategic priorities: distribution is our beating heart
Strategic priorities: distribution is our beating heart Distribution Excellence Vehicle Lifecycle Services People, Culture & Capabilities Digital, Data & Analytics Efficient Scale Operations 2021 Interim results – 29th July 2021 17
Slide 18: Distribution Excellence
Distribution Excellence Becoming the undisputed number one choice for OEMs Customer Lifetime Value Accelerate New vehicle import Customer omni-channel retention Customer acquisition Globalise distribution processes Our six core distribution activities Digitalise processes 2021 Interim results – 29th
Slide 19: Accelerating our omni-channel roll out
Distribution Accelerating our omni-channel roll out Excellence Platform functionality extended Live in all Subaru (financing and used markets car trade-in quote) (five in total) 2018 2019 2020 2021 Platform trialled in Platform deemed Live across 10 Melbourne (Australia) ready for roll-out OEM marke
Slide 20: Two DDCs operational as of March 2021
Distribution Two DDCs operational as of March 2021 Excellence >250 ‘Inchcapers’ already working Digital delivery doubling capability 24-hour solutions and services 2021 Interim results – 29th July 2021 20
Slide 21: Distribution fragmentation a huge opportunity
Distribution Distribution fragmentation a huge opportunity Excellence Annual new car volumes (units) 90m 17m Distribution markets offer greater GDP+ growth prospects New market Typically opportunities insourced e.g. China, US, UK by OEMs 30% Inchcape markets coverage of ‘typical distribution markets
Slide 22: M&A: healthy pipeline of deals
Distribution M&A: healthy pipeline of deals Excellence M&A activity in 1H21 Global Strategic Partnership Platfo Geely in Chile rm NEW OEM win in an existing market OEM deal Leading Partner brand in China Small JLR in Indonesia er Existing OEM win in a NEW market >1.3m scale vehicles sold in 2020 Sel
Slide 23: Vehicle Lifecycle Services
Vehicle Lifecycle Vehicle Lifecycle Services Services Simply capturing more lifetime value Vehicle Lifecycle Value Expand New vehicle import services & activities 1st sale % Leverage 2nd sale existing infrastructure % Build-on 3rd sale % relationships % Finance & Insurance Aftersales Trade-in 2021 I
Slide 24: Capturing the vehicle lifecycle opportunity
Capturing the vehicle lifecycle opportunity Initial user (0-4 years) Subsequent users (4+ years) Vehicle lifetime value1 Revenue 60% 40% Profit 50% 50% Currently underserved 1: analysis predicated on the first 12 years of an average vehicle’s life, and assumes three different owners during that peri
Slide 25: Looking ahead
Duncan Tait Looking ahead
Slide 26: Outlook
Outlook Near-term Strategic-focus Good business momentum Distribution Excellence: extending our leadership Impact of supply shortages Greater use of technology across our business Covid-19 remains dynamic Further building our OEM relationships Supported by geographical diversification Capturing more
Slide 27: Investment proposition: growth and cash returns
Investment proposition: growth and cash returns Disciplined capital allocation Strong cash- conversion Leveraging our Past five years: distribution scale Expansion opportunities FCF = 60-70% of - Dividends: £390m GDP+ organic operating profit Global sharing of - Acquisitions: £600m growth best pract
Slide 28: Q&A
“Bringing Mobility to the world’s communities - for today, for tomorrow and for the better” Q&A
Slide 29: Appendix
Appendix
Slide 30: Pro-forma financials (2019)
Pro-forma financials (2019) Portfolio changes + impact of latest-FX Revenue Revenue impact Net cash impact Distribution £1.0bn Daimler Ecuador Daimler Uruguay £0.5bn Daimler Colombia JLR Poland +£0.4bn £(0.1)bn £9.4bn Daimler El Salvador £7.9bn Daimler Guatemala JLR Indonesia Retail 2019A Net dispos
Slide 31: Our distribution business model
Our distribution business model Sales & Marketing Logistics Network Management Retailing Aftersales 1 2 4 3 5 5 6 9 7 9 8 9 National Network Aftersales and marketing 6 servicing management 4 Brand positioning 8 2 5 7 1 3 Product planning 9 Imports & logistics Parts New & Used distribution vehicle sa