Frontdoor, Inc. · NASDAQ:FTDR
Frontdoor — Q1 2019 Earnings Presentation
15 slides from Frontdoor's earnings presentation, May 8, 2019
Slide 1: First-Quarter 2019 Earnings Webcast
First-Quarter 2019 Earnings Webcast May 8, 2019 1
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, including, in particular, projected future performance and any statements
Slide 3: Agenda
Rex Tibbens Brian Turcotte Matt Davis Chief Executive Officer SVP & Chief Financial Officer VP IR and Treasury Agenda • Q1 2019 Summary • Q1 2019 Financials • Business Update • FY 2019 Outlook 3
Slide 4: Q1 2019 Summary
Q1 2019 Summary Revenue increased 10% to $271 million Gross profit margin increased 150 bps to 47% Adjusted EBITDA increased 34% to $43 million Home Service Plans increased 5% Customer Retention of 75% despite price increases Process improvements continued to drive results Chief People Officer compl
Slide 5: Business Update
Business Update • Marketing spend to ramp through balance of year and continue to drive customer growth Direct-to-Consumer • Benefiting from customer acquisition optimization • Addressing real estate headwinds by adding new brokerage partners to increase unit growth Real Estate • Lower interest rate
Slide 6: 2019 Strategic Objectives
2019 Strategic Objectives Customer Experience Enhancing the Customer Experience Optimizing Pricing / Pricing Launching Dynamic Pricing Business Processes/ Managing to the Inputs Cost Containment of the Business Building a Fast-Moving Culture / People Enabling Frontline Employees Technology Advancing
Slide 7: Financial Summary
Financial Summary Three Months Ended March 31, $ millions, except per share amounts 2019 2018 Change Revenue 271 247 10 % Gross Profit 128 113 13 % Net Income 13 13 (3) % Diluted Earnings per Share 0.15 0.16 (6) % Adjusted Net Income (1) 16 22 (24) % Adjusted Diluted Earnings per Share (1) 0.19 0.26
Slide 8: Adjusted EBITDA Bridge
Adjusted EBITDA Bridge $ millions 15 3 $43 (2) (2) $32 (4) Q1 '18 Revenue Claims Costs Sales & Spin-off Other Q1 '19 Conversion (1) Marketing Dis-synergies Note: Revenue and expense items are year-over-year increases/(decreases); amounts presented in table may not sum due to rounding. • Decreased cl
Slide 9: Cash Flow and Cash Position
Cash Flow and Cash Position Three Months Ended March 31, $ millions 2019 2018 Net cash provided from (used for): Operating Activities $ 52 $ 49 Investing Activities (5) (5) Financing Activities (2) (37) Cash increase during the period $ 45 $ 8 Note: Amounts presented in table may not sum due to roun
Slide 10: Updated Full-Year 2019 Outlook
Updated Full-Year 2019 Outlook 2019 Outlook Low High Revenue ($ billions) $ 1.36 $ 1.38 Gross Profit Margin ~46% Adjusted EBITDA ($ millions)(1) 250 260 Capital Expenditures ($ millions)* 30 40 Annual Effective Tax Rate ~25% *Remained the same from last earnings release. (1) A reconciliation of the
Slide 11: Q&A
Q&A For more information please visit our website: www.frontdoorhome.com 11
Slide 12: Appendix
Appendix 12
Slide 13: Consolidated and Combined Results
Consolidated and Combined Results $ millions, except per share amounts Three Months Ended March 31, 2019 2018 Better / (Worse) Revenue $ 271 $ 247 $ 24 YoY Growth 10% Gross Profit 128 113 15 % of revenue 47.2% 45.7% 1.5 pts Selling and administrative expenses 89 81 (7) % of revenue 32.8% 32.9% (0.2)
Slide 14: Net Income to Adjusted EBITDA Reconciliation
Net Income to Adjusted EBITDA Reconciliation $ millions Three Months Ended March 31, 2019 2018 Net Income $ 13 $ 13 Depreciation and amortization expense 6 4 Restructuring charges — 2 Spin-off charges 1 7 Provision for income taxes 5 5 Non-cash stock-based compensation expense 2 1 Interest expense 1
Slide 15: Net Income to Adjusted Net Income Reconciliations
Net Income to Adjusted Net Income Reconciliations $ millions, except per share amounts Three Months Ended March 31, 2019 2018 Net Income $ 13 $ 13 Amortization expense 2 2 Restructuring charges — 2 Spin-off charges 1 7 Interest income from affiliate — (1) Gain on insured home service plan claims — (