38 slides from Prosus N.v. Class N's debt investor presentation, March 2023
Slide 1: Fixed Income Update
Fixed Income Update March 2023
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: About Us; Highlights and What to Expect; Debt Fundamentals; Appendix
1. About Us 2. Highlights and What to Expect 3. Debt Fundamentals 4. Appendix
Slide 4: About us
About us 70 Investing and operating in 100 Prosus is a global + consumer internet + companies backed since 2008 group and one countries of the largest technology investors in the world #1 Consumer Internet 2bn + Customers use our Company in Europe by products and services market cap 3
Slide 5: We partner with local entrepreneurs to build businesses with platform potential
We partner with local entrepreneurs to build businesses with platform potential … …to address major … in high-growth …where we can build societal needs markets sustainable leadership positions 4
Slide 6: … and use technology to improve the everyday life of billions of people
… and use technology to improve the everyday life of billions of people … Food Delivery Edtech Payment & Classifieds Tencent Our Food Delivery businesses Our Edtech businesses Fintech We shape the future A world-leading internet and are revolutionising the way are bringing more and better of trade t
Slide 7: This has established Prosus as Europe's leading consumer internet company
This has established Prosus as Europe’s leading consumer internet company Prosus is a Top 10 global consumer internet company… …and the largest consumer internet company in Europe Market Capitalisation1 (#039;bn) 91 1,143 2x next largest 958 company 44 442 426 23 236 11 11 9 141 7 7 108 106 91 83 6 5 1
Slide 8: … with unique exposure to assets and operations
… with unique exposure to assets and operations … A diversified portfolio – geographically, across business lines, revenue streams and different business life cycles Operations across 100 countries Ecommerce revenue1 streams Etail Edtech & Other 16% 12% Classifieds Food Delivery Edtech Ventures 26%
Slide 9: Our strategy is a strength in this period of volatility
Our strategy is a strength in this period of volatility … Building global technology leaders, addressing big societal needs in high growth markets Operating businesses Investments Consistently compounding value over time and growing NAV per share $150bn total NAV1, €110 NAV per share With a transpar
Slide 10: … and over time this has resulted in significantly larger businesses
… and overtime this has resulted in significantly larger businesses Ecommerce NAV1 (bn) NAV currently impacted by US$bn macro, longer- term trend is Food Delivery 10.5 growth Classifieds 5.3 Payments and Fintech 4.5 30.3 Edtech 3.8 Etail 2.8 18.5 Ventures 2.3 Other 1.2 30.3 At listing Current (Sep 1
Slide 11: Highlights and what to expect
Highlights and what to expect 1 2 3 We expect a Continuous Accelerated strong integration of Ecommerce sustainable recovery from profitability Tencent business practices 10
Slide 12: We expect a strong recovery from Tencent, but remain committed to our open-ended buyback programme
We expect a strong recovery from Tencent, but remain committed to our open-ended buyback programme funded by small sales of Tencent
Slide 13: We expect a strong recovery from Tencent
We expect a strong recovery from Tencent Tencent to benefit from secular growth, enhanced by excellent execution Unique position in highly Earnings recovery Expected distribution of attractive Chinese deeply undervalued Meituan shares in March 2023 internet market by market will be held for sale and
Slide 14: Small sales of Tencent shares fund our open-ended buyback
Small sales of Tencent shares fund our open- ended buyback The buyback increases exposure to Tencent per share At our current pace, Prosus will remain Tencent's largest shareholder for years to come +2% 26.9% Illustrative Tencent value per share1 Prosus 2nd largest shareholder shareholding 2 8.4% Ot
Slide 15: We are committed to growing our businesses while rapidly accelerating their paths to profitability
We are committed to growing our businesses while rapidly accelerating their path’s to profitability 14
Slide 16: The portfolio has reached scale and is entering a phase of profitable growth
The portfolio has reached scale and is entering a phase of profitable growth We are here ney CRYSTALLISE ur ou r jo Market driven valuation in e are w Deliver crystallisation W h ere DRIVE PROFITABILITY Listings, consolidation, spins and trade sales Leverage the core platforms Optimise cost and inve
Slide 17: Our core businesses are already generating increased profits
Our core core business are already generating increased profits 106 97 74 Trading profit/(loss)1 (US$m) (79) (119) (165) FY18 FY19 FY20 FY21 FY22 1H FY23 1 Results from continuing owned and managed consolidated core Classifieds, Restaurant delivery and Payments businesses. Numbers exclude OLX Ukrain
Slide 18: Further profitability will be driven by:
Further profitability will be driven by: Scale Continued growth Reduce costs We are achieving scale in most of our We continue to grow ahead of We are focused on markets and exiting those we can’t. peers in the world’s fastest cost optimisation and growing markets – Ecommerce efficiencies in all seg
Slide 19: 1H FY23 was the peak of investment and profitability will improve from here
1H FY23 was the peak of investment and profitability will improve from here Trading (loss) profit ($m) Consolidated Ecommerce losses ($m) We expect losses to reduce rapidly as we benefit from scale, prioritise best (81) (140) initiatives, and through (240) significant cost (360) (449) optimisation a
Slide 20: We have multiple levers which can meaningfully enhance profitability
We have multiple levers which can meaningfully enhance profitability Focused Exiting Optimise incremental Reduce costs underperforming organic investment businesses • Prioritise high conviction • Improve unit • Examining all cost • Drawing a line under opportunities economics business that will take
Slide 21: Our ambition is aggregate profitability
Aggregate Ecommerce profitability is in sight… Mature businesses continue to drive profitability, while we scale extensions Ambition to drive further value, profitability and cash flow generation 1H FY25 Now Our ambition Cost & business rationalisation is aggregate profitability Losses Optimisation
Slide 22: Our strength is that our businesses are inherently sustainable
Our strength is that our businesses are inherently sustainable 21
Slide 23: Low carbon, high social impact investment choices
Low carbon, high social impact investment choices Physical services Digital services Payments and Fintech Etail Financial inclusion Access to livelihoods Edtech Food Delivery Learning for all Access to livelihoods Classifieds Ventures Circular economy Inclusive & sustainable businesses 2222
Slide 24: We have made significant progress
We have made significant progress Upgraded rating from medium risk to low risk Prosus included in the DJSI Europe Index Upgraded rating from A to AA Included in FTSE Responsible Investment Index Highest scoring newcomer award in Dutch Transparency Benchmark Upgraded rating from medium risk to low ri
Slide 25: What to expect
What to expect Improved profitability and cashflow generation over time Rock solid financial position with holdco cashflows strengthened and diversified A structured and repeatable process to identify, scale and crystallise value Continued share repurchases while the discount to NAV is elevated Targ
Slide 26: Debt Fundamentals
Debt Fundamentals S&P rating Moody’s rating BBB Upgraded from BBB- in December 2021 Baa3 Upgraded in January 2023 to positive outlook We have consistently Current Net HoldCo Cash Current Net LTV maintained an IG rating and believe $0.7bn 0% this serves us well 84% Of debt maturing after 5 years 7% I
Slide 27: We have a strong balance sheet with sufficient liquidity
We have a strong balance sheet with sufficient liquidity … 2.1X Interest LTM LTM cover2 US$’m Sep 21 Sep 22 $0.7bn net cash Cash remitted to/generated at Holdco level: held centrally Tencent dividend 571 565 Classifieds portfolio 263 196 Other dividends - 60 Debt Cash Interest income earned on centr
Slide 28: … and our debt has a long-dated maturity profile
… and our debt has a long-dated maturity profile A strong balance sheet is supportive in this volatile environment Debt maturity profile (US$’bn) Bond €600m Undrawn Bond Group RCF Bond $1bn US$2.5bn $1bn Bond $1.85bn Bond Bond Bond $1.5bn $1.25bn Bond $1.25bn Bond Bond €1bn Bond $1bn €850m €750m Bon
Slide 29: We have defined guidelines that inform decisions on our capital structure
We have defined guidelines that inform decisions on our capital structure Investment Grade Rating While our balance sheet allows significant flexibility to absorb short term fluctuations in any one of these metrics, we have outlined the rationale for our sustainable guidelines below: Interest Covera
Slide 30: Prosus debt – US bonds
Prosus debt – US bonds 2025 2027 2027 2030 2031 2032 2050 2051 2052 ISIN USN5946FAC16 USN5946FAD98 USN7163RAW36 USN7163RAA16 USN7163RAR41 USN7163RAX19 USN7163RAD54 USN7163RAQ67 USN7163RAY91 SEDOL BYNP2K3 B544682 BPCQJT2 BL38M45 BL53TW5 BPCQKF5 BN2Y9G9 BNBRK44 BYS2RD7 Amount (US$’m) 225 614 1 000 1 2
Slide 31: Prosus debt – EUR bonds
Prosus debt – EUR bonds 2026 2028 2029 2030 2032 2033 2034 ISIN XS2430287529 XS2211183244 XS2360853332 XS2430287362 XS2211183756 XS2363203089 XS2430287875 SEDOL BPGKM02 BK7YNX8 BL53K66 BMH1RC0 BK7YNZ0 BL53KC2 BMH24N3 Amount (€’m) 500 850 1 000 600 750 850 650 Coupon Rate 1.207% 1.539% 1.288% 2.085%
Slide 32: Appendix
Prosus Appendix
Slide 33: Strong execution across our businesses
Strong execution across our businesses … We have achieved scale and profitability or breakeven at our core and are investing to amplify growth & profitability in future years Classifieds Food Delivery Payments & Fintech Edtech 64% 39% 57% 30% 1H FY23 Revenue growth 1H FY23 Revenue growth 1H FY23 Rev
Slide 34: Core profitability has improved meaningfully and is now scaling rapidly
Core profitability has improved meaningfully and is now scaling rapidly Core Classifieds (excl Avito) iFood Brazil Core Payments & Fintech Revenue1 (US$m) 29% 20% YoY2 47% YoY2 YoY2 967 728 643 520 606 375 426 373 499 232 308 363 FY20 FY21 FY22 1H FY23 FY20 FY21 FY22 1H FY23 FY20 FY21 FY22 1H FY23 7
Slide 35: Growth extensions scaling quickly to drive a faster path to profitability
Growth extensions scaling quickly to drive a faster path to profitability OLX Autos iFood Brazil New Initiatives Credit Revenue1 (US$m) 833% 84% YoY 247% YoY YoY 1,619 986 57 49 627 43 209 24 13 16 8 FY20 FY21 FY22 1H FY23 FY20 FY21 FY22 1H FY23 FY20 FY21 FY22 1H FY23 Trading profit/(loss)1 (US$m) (
Slide 36: Group portfolio
Group portfolio 43% economic interest based on Local SA assets the cross-holding agreement between Naspers and Prosus 100% 100% Ecommerce Social & internet platforms Payments & 28% Classifieds Food Delivery Etail Edtech Ventures Fintech 99% 1 100% 94% 80% 100% 22% Since September 2022, we have conti
Slide 37: Glossary of financial terms
Glossary of financial terms Economic interest refers to the Group’s share of revenue or trading profit from investments in associated companies and joint ventures which are presented on a proportionately consolidated basis for segmental reporting purposes in accordance with IFRS 8, Operating Segment
Slide 38: Further information and investor relations contact
If you require any further information, please visit our website www.prosus.com or alternatively email InvestorRelations@prosus.com