Cars.com Inc. · NYSE:CARS
Cars.com — Q2 2022 Earnings Presentation
28 slides from Cars.com's earnings presentation, Aug 3, 2022
Slide 1: Second Quarter 2022 Earnings
Second Quarter 2022 Earnings August 3, 2022
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains “forward-looking statements” within the meaning of the federal securities laws. All statements other than statements of historical facts are forward-looking statements. Forward-looking statements include information concerning the impact of the C
Slide 3: Definitions: Non-GAAP Financial Measures
Definitions: Non-GAAP Financial Measures This presentation discusses Adjusted EBITDA, Adjusted EBITDA Margin, Adjusted Operating Expenses and Free Cash Flow. These financial measures are not prepared in accordance with generally accepted accounting principles in the United States (“GAAP”). These fin
Slide 4: Continued Solid Results in Q2 2022 at High-End of Guidance
Continued Solid Results in Q2 2022 at High-End of Guidance Revenue Continued Dealer Growth and Growth Product Adoption Customer Retention
Slide 5: Consumer Demand Persists, Despite Increased Cost Of Ownership
Industry Trends Consumer Demand Persists, Despite Increased Cost Of Ownership ● Retail prices for new and used vehicles increased 24% and 17% YOY, respectively. ● Delayed OEM production continues, OEM incentives are down YOY. ● Users suggest they may delay their purchase due to macroeconomic factors
Slide 6: Advancing Our Platform Strategy with Relevant Solutions
Platform Strategy Advancing Our Platform Strategy with Relevant Solutions 148MM Marketplace Visits in Q2’22 19,500+ Dealer Customers + 311MM Dealer Website Visits + + Nearly Every OEM Buyers Sellers MARKETPLACE ADVERTISING DEALER WEBSITES FINANCING REVIEWS INVENTORY Integrated Capabilities
Slide 7: High-Quality Efficient Audience Growth Driven By Distinct Traffic & Value Delivery
Traffic & Value Delivery Average Monthly Unique Visitors (MM) High-Quality Efficient Audience Growth Driven By Distinct Editorial Content and Strong Brand +3% YOY
Slide 8: 2022 American-Made Index Reinforces our Brand and SEO Authority
Editorial Strength 2022 American-Made Index Reinforces our Brand and SEO Authority
Slide 9: Demand for Accu-Trade Remains Robust, Instant Cash Offer Launches Nationwide
Solutions Growth Demand for Accu-Trade Remains Robust, Instant Cash Offer Launches Nationwide Instant Offer Accu-Trade Valuation & Marketplace Feature Appraisal Solution
Slide 10: CARS Welcomes Brian Kramer
CARS Welcomes Brian Kramer GM, EVP of Accu-Trade ● Deep industry experience, recognized thought leader in automotive ● 20 years with The Germain Automotive Group, more than a decade as General Manager transforming the company’s wholesale operations ● 5 years as a General Manager for AutoNation ● Ser
Slide 11: Accu-Trade Driving Efficiency, Profitability and Increased Vehicle Acquisition for Dealers
Accu-Trade Driving Efficiency, Profitability and Increased Vehicle Acquisition for Dealers “I have acquired more than “Accu-Trade is my go-to appraisal source. 130 vehicles in the past 60 days It is our gold standard and enables faster and have seen a 58% increase in vehicle appraisal consensus betw
Slide 12: Continued Growth in Website Customers
Website Customers Dealer Inspire Website Customers Continued Growth in Website Customers 5,650 Total Website Customers
Slide 13: Subaru Names Dealer Inspire a Certified Website & Technology Provider
Websites Subaru Names Dealer Inspire a Certified Website & Technology Provider for its 570+ U.S. Dealerships
Slide 14: Dealer Customers +672 YOY, Significant Headroom for Continued Growth
Dealer Customers Dealer Customers +672 YOY, Significant Headroom for Continued Growth Dealer Customers Dealer Customers Addressable Market* Approximately 40K Dealers in the U.S*.
Slide 15: ARPD Growth Driven by Solutions
ARPD Monthly Average Revenue Per Dealer ARPD Growth Driven by Solutions +1% Q2 YOY Growth ARPD excludes revenue from digital advertising services. Q2 2020 excludes the impact of COVID credits (shown in light purple).
Slide 16: Revenue Growth Continues
Revenue Revenue Growth Continues Quarterly Revenue ($MM) * COVID Other OEM/National Dealer *Q2’20 includes COVID credits for customers totaling $38MM
Slide 17: Adjusted Operating Expenses
Operating Expenses Adjusted Operating Expenses Quarterly Expense ($MM) Drivers of YOY Change ● YOY increase in Product and Technology expense driven primarily by higher compensation and consulting costs related to the Accu-Trade and CreditIQ acquisitions. ● YOY increase in Marketing and Sales invest
Slide 18: Q2 Adjusted EBITDA at the High-End of Guidance
Adjusted EBITDA Q2 Adjusted EBITDA at the High-End of Guidance Quarterly Adjusted EBITDA ($MM) & Margin (% Revenue) Adjusted EBITDA Drivers ● Q2 reflects continued investments across our organization to support growth
Slide 19: Q2 2022 Key Operating Metrics
Operating Metrics Q2 2022 Key Operating Metrics Q2 2022 Q2 2021 AVERAGE MONTHLY UNIQUE VISITORS 27.1 MM 26.4 MM TRAFFIC (VISITS) 148.0 MM 158.4 MM MONTHLY ARPD 1 $2,326 $2,299 DEALER CUSTOMERS 19,517 18,845 ¹ARPD excludes revenue from digital advertising services.
Slide 20: Robust Cash Flow, Solid Balance Sheet
Cash Flow Robust Cash Flow, Solid Balance Sheet YTD Free Cash Flow Trend ($MM) Total Debt ($MM) & Net Leverage Ratio Includes $9MM Tax Refund Related to CARES Act Reflects borrowing to fund Accu-Trade acquisition Includes additional payment run Total Debt Total Net Leverage Ratio
Slide 21: Q3 2022 Outlook, Second Half 2022 Outlook
Outlook & Trends Q3 2022 Outlook ● Q3 Revenue: $163.5 to $165.5 million ● Q3 Adjusted EBITDA margin: 29% to 31% Second Half 2022 Outlook ● We expect 2H revenue growth of 6% to 8% YOY ● Reflects continued acceleration of revenue growth, driven by our execution of our integrated solutions strategy
Slide 22: Q&A
S@~- 60 Q&A
Slide 23: Appendix
S@~- 60 Appendix
Slide 24: Non-GAAP Reconciliations (unaudited and in thousands)
Non-GAAP Reconciliations (unaudited and in thousands)
Slide 25: Non-GAAP Reconciliations (unaudited and in thousands)
Non-GAAP Reconciliations (unaudited and in thousands)
Slide 26: Non-GAAP Reconciliations (unaudited and in thousands)
Non-GAAP Reconciliations (unaudited and in thousands)
Slide 27: Definitions: Key Metrics
Definitions: Key Metrics Traffic (“Visits”). Traffic is fundamental to our business. Traffic to the CARS network of websites and mobile apps provides value to our advertisers in terms of audience, awareness, consideration and conversion. In addition to tracking traffic volume and sources, we monitor
Slide 28: Thank You!
CARS ©®«@©6 THANK YOU!