Slide 1: FY20 Results Presentation
FY20 RESULTS PRESENTATION 17 AUGUST 2020
Slide 2: Important Notice
IMPORTANT NOTICE This disclaimer applies to this presentation and the information contained in it (the “Presentation”). By reading this disclaimer you agree to be bound by it. Important notice and disclaimer: This Presentation contains a general summary of the activities of Kogan.com Ltd (the Compan
Slide 3: Contents
CONTENTS CEO Update Page 4 - 18 Financial Update Page 19 - 30 Outlook Page 31 - 34 3
Slide 4: CEO Update
CEO Update Ruslan Kogan Founder, CEO and Executive Director 4
Slide 5: FY20 Highlights
FY20 HIGHLIGHTS In FY20 our Business thrived through adversity as years of preparation met opportunity, resulting in Gross Sales1, Gross Profit and Adjusted EBITDA2 growth of 39.3%, 39.6% and 57.6%, respectively. ● Gross Sales1 of $768.9 million outperformed the prior year by 39.3% FINANCIAL PERFORM
Slide 6: FY20 Results
FY20 RESULTS Adjusted EBITDA1 of $49.7 million exceeded FY19 Adjusted EBITDA1 by 57.6%, driven by Gross Profit growth of 39.6%. FY19 vs FY20 $m FY19 FY20 Variance Gross Sales2 551.8 768.9 39.3% ▲ Revenue3 438.7 497.9 13.5% ▲ Gross Profit 90.7 126.5 39.6% ▲ Gross Margin 20.7% 25.4% 4.7pp/23% ▲ EBITDA
Slide 7: 2HFY20 Results
2HFY20 RESULTS Growth in Gross Sales1, Gross Profit, Adjusted EBITDA2 and NPAT accelerated in 2HFY20. 2HFY19 vs 2HFY20 $m 2HFY19 2HFY20 Variance Gross Sales1 274.5 446.1 62.5% ▲ Revenue3 206.9 278.4 34.5% ▲ Gross Profit 45.5 76.6 68.3% ▲ Gross Margin 22.0% 27.5% 5.5pp/25.1% ▲ EBITDA 16.5 29.8 80.3%
Slide 8: Financial Highlights
FINANCIAL HIGHLIGHTS Improving Operating Leverage over many years has allowed Kogan.com to grow Adjusted EBITDA1 at a faster rate than Gross Sales2 and Gross Profit. GROSS SALES2 GROSS PROFIT ADJUSTED EBITDA1 NPAT 39.3% ▲ 39.6% ▲ 57.6% ▲ 55.9% ▲ 768.9 126.5 49.7 26.8 551.8 90.7 492.6 80.6 31.5 17.2
Slide 9: Who We Are
WHO WE ARE We have built a Business that allows us to be agile, bold and innovative. Our growing portfolio of businesses enables us to scale significantly while mitigating operational risks. 2,200 2,100 Active Customers (000's) 2,000 1,900 2,183,000 1,800 1,700 1,600 Active Customers 1,500 Jun 2019
Slide 10: Dedicated to Serve Our Customers
DEDICATED TO SERVE OUR CUSTOMERS We continue to deliver a high level of customer satisfaction across a wide range of products and services. Three-peat! Third year running, winner of the People’s Choice Award at the Australia Post Online Retail Industry Awards 2019 (ORIAS) NET PROMOTER SCORE1 100 Ave
Slide 11: Kogan Kinetics
KOGAN KINETICS Our mission is to make the most in-demand products and services more affordable and accessible for all. ENHANCED CONSUMER OFFERING CUSTOMER & PLATFORM GROWTH • Broader selection • Scale of efficiencies • Improved pricing • Customer acquisition & retention The Kogan.com Virtuous Cycle
Slide 12: Building the Kogan.com Platform
BUILDING THE KOGAN.COM PLATFORM Annual Gross Sales per Customer1 is expected to benefit as recently acquired Customers continue to shop through the remainder of their first year. REPEAT BUSINESS - CREATING BRAND LOYALTY REPEAT BUSINESS - NEW CUSTOMERS More than 40% growth YoY in 2HFY20 of new custom
Slide 13: Building the Kogan.com Platform
BUILDING THE KOGAN.COM PLATFORM Free traffic continues to represent more than 70% of all traffic following significant investment in our platform. LTM RETURN ON INVESTMENT IN MARKETING1 $58 $56 LTM return on investment in marketing1, we $31 have invested heavily in our platform and growing Active Cu
Slide 14: Kogan Marketplace
KOGAN MARKETPLACE Gross Sales1 in 2HFY20 grew by 71.2% on 1HFY20. The pipeline for new sellers remains strong and continues to grow. KOGAN MARKETPLACE GROSS SALES1 ACHIEVED SIGNIFICANT GROWTH HALF-ON-HALF 71.2% ▲ 100.0 75.0 Gross Sales1 ($m) 50.0 25.0 0.0 2HFY192 1HFY20 2HFY20 The growth of Kogan Ma
Slide 15: Exclusive Brands Strategy
EXCLUSIVE BRANDS STRATEGY Exclusive Brands achieved Revenue growth of 34.1% in 2HFY20 vs 2HFY19, continuing to meet strong consumer demand across a wide-array of products. YoY GROWTH IN EXCLUSIVE BRANDS REVENUE ACCELERATED IN 2HFY20 34.1% ▲ 150 Exclusive Brands growth rate increased YoY and benefits
Slide 16: Kogan First
KOGAN FIRST Kogan First provides members with a suite of consumer benefits, creating a large and growing community of loyal customers who access free shipping and a range of exclusive benefits. KOGAN FIRST MEMBERS1 Kogan First members purchase on average much more often than non- members, demonstrat
Slide 17: Our Proprietary Technology
OUR PROPRIETARY TECHNOLOGY IT solutions powering scale. PLATFORM FOR SCALE & GROWTH TECHNOLOGY PLATFORM Proprietary eCommerce Engine Refined Team Technical Capability • Offers over 13 payment methods - including BNPL • Proprietary Product Search algorithm • Strong development processes • Secure plat
Slide 18: Our Proprietary Technology
OUR PROPRIETARY TECHNOLOGY ALGORITHMS & A.I. POWERING SCALE Kogan’s proprietary technology processes millions of events each day to achieve industry leading personalisation and optimisation across: • A.I. powered recommendations on site and in outbound marketing; • Dynamic and personalised marketing
Slide 19: Financial Update
Financial Update David Shafer CFO, COO and Executive Director 19
Slide 20: FY20 Results Compared to FY19
FY20 RESULTS COMPARED TO FY19 Adjusted EBITDA1 growth to $49.7 million represents an increase of 57.6%. $m FY19 FY20 Variance % Gross Sales2 551.8 768.9 39.3% Overview Revenue3 438.7 497.9 13.5% Gross Sales2 reflects the total transactional value of Kogan Retail, Cost of sales (348.0) (371.4) Kogan
Slide 21: 2HFY20 Results Compared to 2HFY19
2HFY20 RESULTS COMPARED TO 2HFY19 2HFY20 reflected a period of strong acceleration in key metrics. $m 2HYFY19 2HFY20 Variance % Gross Sales1 274.5 446.1 62.5% Overview Revenue2 206.9 278.4 34.5% Gross Sales1 growth accelerated through the period. Our diversified Cost of sales (161.4) (201.8) 25.0% s
Slide 22: Key Drivers of Kogan.com FY20 Financial Performance
KEY DRIVERS OF KOGAN.COM FY20 FINANCIAL PERFORMANCE Kogan.com shines through adversity as preparation meets opportunity. The Business achieved growth in Active Customers of 35.7% in FY20. At 30 June 2020 the Business had PLATFORM GROWTH 2,183,000 Active Customers. Kogan First memberships scaled sign
Slide 23: Key Drivers of Kogan.com FY20 Financial Performance
KEY DRIVERS OF KOGAN.COM FY20 FINANCIAL PERFORMANCE Kogan Mobile performed relatively in line with FY19, contributing over 10% of total Gross Profit and setting NEW VERTICALS up a solid foundation for growth of Kogan Mobile New Zealand. Kogan Internet Customers grew 90.9% year-on-year, resulting in
Slide 24: Improving Operating Leverage
IMPROVING OPERATING LEVERAGE FY17 FY18 FY19 FY20 Revenue 100.0% 100.0% 100.0% 100.0% Gross Margin 17.9% 19.5% 20.7% 25.4% Delivered Margin (after all logistics costs) 14.2% 16.1% 16.5% 21.4% Marketing costs 3.7% 4.8% 4.3% 5.6% Contribution Margin 10.6% 11.3% 12.3% 15.8% Fixed costs 6.3% 5.0% 5.4% 6.
Slide 25: FY20 Gross Profit Product & Business Mix
FY20 GROSS PROFIT PRODUCT & BUSINESS MIX More than half of our Gross Profit is generated from our Exclusive Brands Products. Other Income1 5.6% Advertising Income 2.9% Kogan Mobile Australia 10.1% Kogan Marketplace 10.3% Exclusive Brands 51.3% Kogan Marketplace outperformed all expectations in FY20.
Slide 26: Kogan Mobile & Kogan Internet
KOGAN MOBILE & KOGAN INTERNET Kogan Mobile Australia and Kogan Internet continue to achieve growth in number of Customers. Kogan Mobile NZ launched during 1HFY20. KOGAN INTERNET CUSTOMERS1 Kogan Internet commission-based Revenue grew 144.9% year-on-year driven by Customer growth of 90.9%. Management
Slide 27: Kogan Super, Kogan Energy, Kogan Credit Cards
KOGAN SUPER, KOGAN ENERGY, KOGAN CREDIT CARDS Recently launched Kogan Super, Kogan Energy and Kogan Credit Cards are growing strongly. KOGAN SUPER FUNDS UNDER MANAGEMENT1 KOGAN ENERGY CUSTOMERS2 Funds Under Management Active Customers 1HFY20 2HFY20 1HFY20 2HFY20 KOGAN CREDIT CARDS CUSTOMERS2 Kogan S
Slide 28: Kogan Insurance
KOGAN INSURANCE Kogan Insurance commission-based Revenues for FY20 grew by 36.0% year-on-year. KOGAN INSURANCE COMMISSION-BASED REVENUES 1,000 Commission-based revenue (#039;000) 750 500 250 0 FY181 FY19 FY20 Kogan Insurance, which includes our suite of insurance products, continues its strong growth i
Slide 29: Net Assets
NET ASSETS A strong balance sheet at 30 June 2020 with $146.7 million of cash and an undrawn debt facility. $m Jun-20 Cash balance at 30 June 2020 of $146.7 million is CURRENT ASSETS inclusive of the proceeds from the $100.0 million Cash 146.7 Placement, and exclusive of the proceeds from the Trade
Slide 30: FY20 Statutory Cash Flow
FY20 STATUTORY CASH FLOW $m CASH FLOWS FROM OPERATING ACTIVITIES Receipts from customers 578.0 Payments to suppliers and employees (522.8) Interest received 0.1 Finance costs paid (0.6) Income tax paid (9.0) The Business delivered cash flow from Net cash provided by operating activities 45.6 operati
Slide 31: Outlook
Outlook kogan.com
Slide 32: Portfolio Business - Market
PORTFOLIO BUSINESS - MARKET Achieved greater than Portfolio Business Partner Launch date Market size 1% market share? Kogan Retail n/a FY06 $29.4 billion1 ✓ Kogan Marketplace n/a Launched FY19 $29.4 billion1 - Kogan Internet Vodafone Launched 4QFY18 11.6 million premises2 - Kogan Insurance Hollard L
Slide 33: FY21 Outlook
FY21 OUTLOOK We expect that FY21 will see further growth in Exclusive Brands, the scaling up of Kogan Marketplace and New Verticals, and further growth in the Active Customer base. Consistent with prior years, the Company will not be providing formal Adjusted EBITDA1 guidance for FY21. However, the
Slide 34: Dividend
DIVIDEND The Board has declared a fully franked final Dividend of 13.5 cents per share, which reflects total Dividends of 21.0 cents per share in respect of FY20. The Dividend Reinvestment Plan will apply to the final Dividend at a 2.5% discount to the 5-day volume weighted average price of shares s
Slide 35: Glossary
GLOSSARY 1HFYxx: the six months ended 31 December 20xx. 2HFYxx: the six months ended 30 June 20xx. 1QFYxx: the three months ended 30 September 20xx. 2QFYxx: the three months ended 31 December 20xx. 3QFYxx: the three months ended 31 March 20xx. 4QFYxx: the three months ended 30 June 20xx. Active Cust
Slide 36: Glossary
GLOSSARY Kogan Marketplace: a platform launched in 3QFY19 for sellers and buyers to complete transactions on Kogan.com, with commission-based Revenue being earned by Kogan.com. Kogan Mobile Australia: launched in 2QFY16, vertical offering pre-paid mobile phone plans available online using Vodafone’s
Slide 37: Annexure 1: FY20 Revenue Growth by Portfolio Business
ANNEXURE 1 FY20 REVENUE GROWTH BY PORTFOLIO BUSINESS Revenue growth was driven by Exclusive Brands and Kogan Marketplace. FY19 FY20 $m Revenue Revenue YoY Revenue growth % Exclusive Brands 184.1 232.7 26.4% Third-Party Brands 233.2 228.6 (2.0%) Kogan Marketplace 1.5 13.0 768.4% Product Divisions 418