Mony Group Plc · LSE:MONY
Mony — Moneysupermarket Group — H1 2018 Earnings Presentation
30 slides from Mony's earnings presentation, Jul 19, 2018
Slide 1: Interim Results
Moneysupermarket roup Interim Results 19 July 2018
Slide 2: Mark Lewis, Chief Executive Officer
Mark Lewis Chief Executive Officer
Slide 3: Trading in line with expectations, good progress on strategy
Trading in line with expectations, good progress on strategy Trading in line with expectations • Helped households save £1.1bn • Continued strong cash generation Progress on strategy • Customer Experience Optimisation scaling • Progress across drivers of New Market Growth 3
Slide 4: Matthew Price, Chief Financial Officer
Matthew Price Chief Financial Officer
Slide 5: Half year themes
Half year themes Diversified business delivering to plan • Savings for customers £1.1bn • Performance as planned • Revenue growth +5%, Adjusted EBITDA flat at £62m and adjusted EPS +4% Disciplined approach to costs • The investment of £5m in our product engineering is on track • Technology capex red
Slide 6: We continue to deliver as expected
We continue to deliver as expected Revenue +5% EBITDA (Adjusted) +0% EPS (Adjusted Basic) +4% £165m £174m £62m £62m 8.1p 8.4p HY 2017 HY 2018 HY 2017 HY 2018 HY 2017 HY 2018 Tech Capital Investment -30% Interim Dividend +4% Operating Cash flow +2% £10m £7m 2.84p 2.95p £42m £43m HY 2017 HY 2018 HY 20
Slide 7: Income statement
Income statement £Millions HY 2018 HY 2017 Growth Revenue 173.7 165.3 5% Gross Margin 72% 73% Adjusted EBITDA * 62.2 62.1 0% EBITDA margin % 36% 38% Depreciation & Software Amortisation (6.1) (6.9) Adjusting items ** (4.1) (6.7) Operating Profit 52.0 48.5 7% Net finance costs (0.3) (0.3) Profit on d
Slide 8: Our diversified performance
Our diversified performance Revenue HY 2018 (£M) HY 2017 (£M) Growth (%) Insurance 93.3 90.1 4% Money 44.5 43.8 2% Home Services 22.5 18.4 23% Core Group revenue 160.3 152.3 5% Other revenue 13.4 13.0 3% Total Group 173.7 165.3 5% 8
Slide 9: Our disciplined approach to marketing continues
Our disciplined approach to marketing continues Marketing spend Revenue by source £Millions HY 2018 HY 2017 YoY £165m £174m TV & Radio 14.5 14.4 0.1 24% 25% Online spend 44.7 39.7 5.0 75% 76% Other 6.8 7.8 (1.0) £123m £133m Total Group 66.0 61.9 4.1 Marketing margin 62% 63% (1%) HY 2017 HY 2018 Sear
Slide 10: Technology capex reduces as our replatforming is now complete
Technology capex reduces as our replatforming is now complete Total Tech Investment Reinvestment Rate (%) £21m £18m £11m +13% +10% HY 2017 HY 2018 £11m £10m £7m • Operating costs are mainly staff costs and licenses • The re-factoring on our car insurance question set HY 2017 HY 2018 is complete Tech
Slide 11: Strong levels of cash generation
Strong levels of cash generation £62.2m (£6.7m) (£12.5m) (£40.9m) (£4.2m) £35.1m (£8.6m) £24.4m Net cash at Adj. EBITDA Working Capital items Dividends Strategy & Tax Net cash at 1 Jan 2018 capital Other 30 Jun 2018 11
Slide 12: Capital allocation framework
Capital allocation framework Organic Ordinary Acquisitions Special Growth Dividends Distribution 12
Slide 13: Mark Lewis, Chief Executive Officer
Mark Lewis Chief Executive Officer
Slide 14: Strong, differentiated core business model
Strong, differentiated core business model • 6-7% Core switching annual growth forecast 2018-20 Growing • Diversified revenue across categories Markets • Opportunity to unlock further market growth • Market leading 72 NPS vs comparison average 65 Engaged • 13m Active users Users • £15.40 Revenue / A
Slide 15: Customer Experience Optimisation scaling on track
Customer Experience Optimisation scaling on track Reaccelerate Core Growth Build out of Product Engineering hub on track Leading • Dedicated squads recruited in Manchester Trusted Brands • Teams restructured to accelerate delivery • Each comparison area has its own focused team Rapid innovation of t
Slide 16: Customer Experience Optimisation Case Study: MSM Energy
Customer Experience Optimisation Case Study: MSM Energy Awaiting updated shot Unique strength in ‘Collective Switches’ Classic Price Comparison 16
Slide 17: Customer Experience Optimisation Case Study: MSM Energy
Customer Experience Optimisation Case Study: MSM Energy Conversion Optimisation Optimisation Optimisation Optimisation Optimisation Optimisation Replatforming Code Freeze Q1'18 Q2'18 H1 2017 Revenue growth < 0% H1 2018 Revenue growth >50% 17
Slide 18: Progress across drivers of New Market Growth
Progress across drivers of New Market Growth Personalised MSM • App development on track New Market Growth • Customer engagement rates increasing • “Monitored” energy proposition live Take Price Comparison to the user 1 2 3 • Announced strategic acquisition of Decision Tech to Take Price Mortgage Pe
Slide 19: Taking Price Comparison to the user
Taking Price Comparison to the user Opportunity to develop B2B Partnerships with new platforms • Make it easier to save by taking personalised deals to users • New B2B sales channel • Leveraging our trusted brands and technology platform Decision Tech acquisition offers accelerated entry to B2B mark
Slide 20: Mortgage Price Comparison - Created fintech Podium to target the opportunity
Mortgage Price Comparison - Created fintech “Podium” to target the opportunity Opportunity to transform the mortgage experience for users and lenders • Help users compare the true cost and acceptance for mortgage offers • Digital integration with lenders’ approval processes • Increase value to lende
Slide 21: Trading in line with expectations, good progress on strategy
Trading in line with expectations, good progress on strategy Trading in line with expectations • Helped households save £1.1bn • Continued strong cash generation Progress on strategy • Customer Experience Optimisation scaling • Progress across drivers of New Market Growth 21
Slide 22: Appendix
Moneysupermarket roup Appendix
Slide 23: Cash and capital update
Cash and capital update • Software amortisation costs were £6 million in the first half and we expect the full-year amortisation charge to be in the region of c.£14 million for 2018 • We expect technology capital investment of c.£13 million in 2018 and total capex of c.£17 million • Amortisation of
Slide 24: Dividends, EPS and dividend cover
Dividends, EPS and dividend cover Dividend (pence) HY 2018 HY 2017 Interim 2.95 2.84 Ratios HY 2018 HY 2017 Earnings per share (Adjusted basic) 8.4 8.1 Dividend Cover 2.8x 2.9x Dates for interim dividend – 2nd August 2018 ex-div date, 14th September 2018 payment date. 24
Slide 25: Adjusted EBITDA
Adjusted EBITDA £Millions HY 2018 HY 2017 Variance Variance (%) Revenue 173.7 165.3 8.4 +5% Gross Profit 124.4 120.4 4.0 +3% Gross Margin 72% 73% Administrative Costs (55.7) (54.5) (1.2) +2% Distribution Costs (16.7) (17.4) 0.7 -4% Operating Profit 52.0 48.5 3.5 +7% Amortisation of acquired intangib
Slide 26: Adjusted cost base
Adjusted cost base £Millions HY 2018 HY 2017 Growth Staff costs 27.5 25.4 2.1 Depreciation 0.5 0.7 (0.2) Amortisation of technology 5.6 6.0 (0.4) Irrecoverable VAT 6.8 6.3 0.5 Other administrative costs 11.2 9.9 1.3 Total Adjusted Administrative Costs 51.5 48.3 3.2 Advertising 14.5 14.4 0.1 Other ma
Slide 27: Earnings Per Share Calculations
Earnings Per Share Calculations £Millions HY 2018 HY 2017 Adjusted Earnings 45.3 44.4 Basic average shares (millions) 536.0 544.6 Basic adjusted EPS (pence) 8.4 8.1 Diluted average shares (millions) 537.0 546.8 Diluted adjusted EPS (pence) 8.4 8.1 27
Slide 28: Balance sheet
Balance sheet £Millions 30 June 2018 30 June 2017 Property, Plant And Equipment 14.0 6.9 Intangible Assets – Technology 33.3 41.1 Intangible Assets - Acquisition Related 112.0 113.1 Investments 0.7 0.2 Trade and Other Receivables 55.5 47.4 Cash and Cash Equivalents 24.4 17.7 Total Assets 239.9 226.5
Slide 29: Strategic KPIs
Strategic KPIs Help households save money £1.1Bn 72% 62% Savings made by customers Net promoter score Marketing margin 13M £15.40 Active users Revenue per active user Definitions: Estimated Savings made by customers in HY 2018 Net Promoter Score: Twelve monthly rolling average ([1 July 2017- 30 June
Slide 30: Historical disclosure
Historical disclosure Revenue HY 2018 (£M) HY 2017 (£M) Growth (%) Insurance 92.0 88.6 4% Money 42.1 41.8 0% Home Services 20.6 16.9 22% MoneySuperMarket.com 154.7 147.3 5% MoneySavingExpert.com 22.9 20.0 15% TravelSuperMarket.com 12.6 12.2 3% Intra-Group eliminations and other income (16.5) (14.2)
Moneysupermarket Group — H1 2018 Earnings Presentation on 6ix