31 slides from Prosus N.v. Class N's earnings presentation, Nov 23, 2022
Slide 1: Financial Results
Financial Results For the six months ended September 2022
Slide 2: Forward looking statements
Forward looking statements 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
Slide 3: Agenda
1. Business Update 2. Financial Update Agenda 3. Closing remarks
Slide 4: Business Update
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Slide 5: Navigating a volatile climate with strong execution and balance sheet
Navigating a volatile climate with strong execution and balance sheet 1 Strong operating performance drove continued Ecommerce growth and scale +41% ecommerce revenue growth 2 Focus on improving profitability coupled with targeted investment Investment peaked in 1H FY23; ambition for consolidated Ec
Slide 6: Our strategy is a strength in this period of increased volatility
Our strategy is a strength in this period of increased 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 $127bn total NAV1, €93 NAV per share, 6.9%
Slide 7: Strong execution across our businesses in 1H
… and resulted in strong execution across our businesses in 1H 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 Reve
Slide 8: We deployed further capital to our businesses and our stock
We deployed further capital to our businesses and our stock … Funded the continued Acquired full ownership Rapidly shrunk growth of our segments of iFood at a fair price our shares outstanding OLX Autos Credit Industry leader Proven track record Convenience $5.8bn Reputation for innovation Share rep
Slide 9: Driving significant growth and improved competitive positioning
… driving significant growth and improved competitive positioning Specific Investment Initiatives Operational Performance Build retail infrastructure (B2C), scale 84% Auto Revenue growth consumer financing, brand activation and build Transactions a scalable technology-enabled platform >100k Cars tra
Slide 10: The benefits of the repurchase program will compound over time
The benefits of the repurchase program will compound over time … The buyback accretes NAV per share … … and enhances our returns Illustrative NAV per share annualising buyback programme at current pace1 NAV per share IRR with and without buyback at various portfolio IRRs3 Annual accretion +8% 39% +7
Slide 11: Increasing our exposure to Tencent on a per share basis
… while increasing our exposure to Tencent on a per share basis Buyback increases our exposure to Tencent … ... which should benefit from strong secular tailwinds Illustrative Tencent value per share1 +1.4% Diverse revenue streams in growth businesses Inherent profitability augmented by cost control
Slide 12: Financial Update
Financial Update Basil Sgourdos
Slide 13: Financial Highlights
Financial Highlights 1 Ecommerce growth was strong, while Group revenue was impacted by FX and a lower contribution from Tencent Ecommerce businesses remained profitable or breakeven at the core enabling further investment in segment growth 2 extensions to create future value, profitability and cash
Slide 14: Strong revenue growth across our segments
Strong revenue growth across our segments … Ecommerce revenue (US$’m)1 Segmental revenue (US$’m)1 1H FY22 1H FY23 52% 41% YoY Growth 60% 5 217 -4% 1 911 3 858 1 339 1 261 55% 988 1 029 38% 852 480 359 334 120 1H FY22 1H FY23 Classifieds Food Delivery Payments & Fintech Edtech Etail 1 Results of cont
Slide 15: Revenue driven by consolidated operations and investments
… driven by consolidated operations and investments Total Ecommerce Economic Interest Consolidated Revenue Associate and JV Revenue Economic Interest Basis1 Majority Owned Consolidated2 Businesses Minority Owned Investee Companies 35% (41%) Revenue ($bn) 18% (33%) 5.2 79% (60%) 3.9 3.2 2.8 2.0 1.1 1
Slide 16: 1H investment drove growth and represents the peak investment level
1H investment drove growth and represents the peak investment level Total ecommerce economic interest Organic investment through P&L Associate & JV losses don’t impact cash Economic Interest Basis1 Majority Owned Consolidated2 Businesses Minority Owned Investee Companies 1H FY22 1H FY23 1H FY22 1H F
Slide 17: iFood's core scales profitability while investing in convenience
iFood’s core scales profitability while investing in convenience Consolidated Food Delivery1 iFood Brazil2 ($m) Core Restaurant Business Profitable Margin improvement from New Initiatives3 43% (39%) 32% (29%) Revenue ($m) 850% (833%) 606 458 57 663 6 1H FY22 1H FY23 1H FY22 1H FY23 464 Trading profi
Slide 18: Classifieds growing through disruption, while expanding Autos business
Classifieds growing through disruption, while expanding Autos business Consolidated Classifieds businesses1 Core Classifieds Business Profitable1 Investing to scale Autos B2C business1,3 ($m) Ukraine 37% (64%) 60% (84%) -15% (13%) Revenue ($m) 273 232 986 30 15 -$149m FX impact2 243 617 217 -$42m FX
Slide 19: Payments sustained core growth and improved margin in credit
Payments sustained core growth and improved margin in credit Consolidated Payments & Fintech1 Sustained Core Payments Growth Margin improvement from New initiatives3 ($m) 33% (57%) 23% (47%) Revenue ($m) 227% (247%) 363 49 294 -$70m FX impact3 -$3m FX impact3 15 412 1H FY22 1H FY23 1H FY22 1H FY23 3
Slide 20: Strong Edtech revenue growth with investment focused on expansion
Strong Edtech revenue growth with investment focused on expansion Consolidated1 enterprise Edtech platforms, Stack Overflow and GoodHabitz, invested in product enhancement and footprint expansion ($m) 1H FY22 1H FY23 174% (30%) Total bookings grew 53%, translating into 33% 63 revenue growth driven b
Slide 21: Optimizing the cost structure and accelerating profitability
We are optimizing the cost structure and accelerating profitability Optimisation of current operations We are improving unit economics and driving efficiencies and cost reductions in our underlying businesses to optimise performance Focused incremental organic investment Direct incremental investmen
Slide 22: Core HE impacted by reduced Tencent stake and increased investment
Core HE impacted by reduced Tencent stake and increased investment Core headline earnings reduced following lower contributions from Tencent and increased investment in Ecommerce Incremental Core HE, YoY ($m) (879) (263) 2 215 -60% (-47%) (262) 86 1336 811 897 1H FY22 Reduced contribution from Reduc
Slide 23: FCF reflects a stable Tencent dividend offset by investment
FCF reflects a stable Tencent dividend offset by investment Incremental FCF, YoY ($m)1 (3) Dividend tax saving as (125) no dividends were (132) received from Avito $565m dividend from Tencent (33) 1 50 (22) 1H FY22 Cash from operations Working capital Tax Capex Tencent and other 1H FY23 (excluding W
Slide 24: A strong balance sheet is supportive in this environment
A strong balance sheet is supportive in this environment Net cash1 $0.6bn at 30 September 2022 Since September 2022 Investment Grade BBB (S&P) / Baa3 (Moody’s) Committed €1.5bn4 to the acquisition of the remaining 33.3% stake in iFood 12% LTV Based on Gross Debt2 15.2 15.8 Sold Avito for net proceed
Slide 25: Closing remarks
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Slide 26: Key Priorities for the remainder of the year and beyond
Key Priorities for the remainder of the year and beyond We will continue the open-ended buyback to take advantage of the group’s valuation discount to permanently 1 increase shareholders’ per share exposure to the NAV of our investments in Tencent and Ecommerce We remain committed to investing in th
Slide 27: Appendix
Drosus Appendix
Slide 28: Major businesses in the Group's Ecommerce portfolio
Major businesses in the Group’s Ecommerce portfolio Controlled and managed businesses Associates and JV’s Investments Classifieds Food Delivery1 Payments & Fintech1 Edtech1,2 Accounting: 100% consolidated Equity accounted FV through OCI 1 The illustrated logos represent the major contributors in ter
Slide 29: Group portfolio
Group portfolio Local SA assets 43% economic interest based on 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% 99% 100% 63%2 62% 62% 13% 40% 74% 26
Slide 30: Glossary and financial definitions
Glossary and financial definitions 1P / 3P: First party / Third Party Consolidated Earnings: Results of subsidiaries only, companies which the group controls CAGR: Cumulative Annualised Growth Rate Economic Interest: A non-IFRS measure representing the consolidated earnings plus the group’s proporti
Slide 31: For further information
For further information: Visit our website: www.prosus.com or www.naspers.com Email: InvestorRelations@prosus.com