Mercadolibre, Inc. · NASDAQ:MELI
Mercadolibre — Q3 2018 Earnings Presentation
31 slides from Mercadolibre's earnings presentation, Nov 2, 2018
Slide 1: Investor Presentation Third Quarter 2018 Results
INVESTOR PRESENTATION Third Quarter 2018 Results November 01, 2018
Slide 2: Safe Harbor
This presentation may make forward - looking statements relating to such matters as continued growth prospects for the company, industry trends and product and technology initiatives . These statements are based on currently available information and our current assumptions, expectations and project
Slide 3: Third Quarter 2018 Operational & Financial Highlights
Third Quarter 2018 Operational & Financial Highlights us$3.0BN +28%LC YoY Total GMV us$4.6BN +70%LC YoY Total TPV 65.6% + 48%LC YoY GMV Shipped us$2.9BN +40%LC YoY Total TPV ON us$1.6BN +163%LC YoY Total TPV OFF 103.9MM +67% YOY Total TPN 83.5MM + 13% YoY Items Sold us$355.3MM +58%LC YoY Net Revenue
Slide 4: Overview: Quarterly Highlights
Third Quarter 2018 Overview 1. Quarterly Highlights 2. KPIs 3. Financial Metrics 4. Margin Structures
Slide 5: Overview: Quarterly Highlights
Third Quarter 2018 Overview 1. Quarterly Highlights 2. KPIs 3. Financial Metrics 4. Margin Structures
Slide 6: Financial Results
Financial Results • Gross Billings came in at $ 462 . 8 million dollars, growing 24 . 9 % YoY in USD and 48 . 1 % YoY on an FX Neutral basis, marking 18 th consecutive quarter of FX Neutral gross billings growth above 45 % YoY . • Gross billings was solid across main countries on an FX Neutral basis
Slide 7: Payments – MercadoPago
Payments – MercadoPago • MercadoPago had a stellar quarter once again accelerating growth and scale . During the month of September, for the first time ever not only MP processed more total payment transactions off platform that on MELI’s marketplaces, but total payment transactions surpassed the on
Slide 8: Marketplace
Marketplace • Marketplace business continues to show great resiliency in spite of increasingly difficult comps . On a consolidated basis FX Neutral GMV grew 27 . 9 % YoY, while if we exclude Venezuela from last year FX Neutral GMV grew at a solid 37 . 7 % YoY . • Mexico is consolidating as an engine
Slide 9: Logistics - MercadoEnvíos
Logistics - MercadoEnvíos • The adoption of our proprietary logistics network is making strides with over 15 % of the shipments through MercadoEnvios was sent through it during the quarter . • Shortened lead times by almost 20 % on a consolidated basis over the last year . Brazil is the geography wh
Slide 10: Overview: KPIs
Third Quarter 2018 Overview 1. Quarterly Highlights 2. KPIs 3. Financial Metrics 4. Margin Structures
Slide 11: Brazil Gross Merchandise Volume & Items Sold
Brazil Gross Merchandise Volume & Items Sold Tougher comps, R$ 5 flat fee launched in July for items below R$ 120 and the removal of listings below R$ 6 affected Items growth. However, LC GMV maintained momentum as we incentivize higher ticket purchases LC GMV Evolution per Quarter Items Evolution p
Slide 12: Mexico Gross Merchandise Volume & Items Sold
Seven consecutive quarters of items and LC GMV growth above 65.0% YoY as we continue to improve assortment, and leverage our fast and free shipping value proposition to our Mexican buyers LC GMV Evolution per Quarter Items Evolution per Quarter (M) 76% 91% 77% 73% 68% -0.1 0.1 0.3 0.5 0.7 0.9 1.1 1.
Slide 13: Argentina Gross Merchandise Volume & Items Sold
LC GMV Evolution per Quarter Items Evolution per Quarter (M) 39% 59% 53% 57% 49% 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 3Q17 4Q17 1Q18 2Q18 3Q18 LC YoY Growth Free Shipping Launch 25% 46% 44% 54% 49% 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 3Q17 4Q17 1Q18 2Q18 3Q18 Sold Items YoY Growth Free Shippin
Slide 14: Other Geos Gross Merchandise Volume & Items Sold
Shift to lower ticket purchases affected LC GMV, although continuing to drive high items growth LC GMV Evolution per Quarter Items Evolution per Quarter (M) • Others includes : Chile ; Colombia; Bolivia; Costa Rica; Ecuador; El Salvador; Guatemala; Honduras; Paraguay; Nicaragua; Panama; Paraguay; Pe
Slide 15: Successful Items per Unique Buyer
Successful Items per Unique Buyer Accelerating Engagement Across the Region beyond Brazil due to t ougher comps, flat fee impact and the removal of listings below R$ 6 4.8 5.8 6.3 4.4 5.4 5.1 4.7 5.2 4.3 0 1 2 3 4 5 6 7 3Q17 2Q18 3Q18 3Q17 2Q18 3Q18 3Q17 2Q18 3Q18 31 % - 10% 16% 2.4 3.0 4.6 2.7 3.3
Slide 16: Consolidated Items Sold
Consolidated Items Sold Solid Growth in Items Sold * Excluding Venezuela **Free Sold Items as a % of Sold Items Shipped Items Sold Evolution per Quarter (M) 74.2 81.2 80.2 85.4 83.5 68.7 83.5 56% 57% 51% 39% 13% 0.00 0.10 0.20 0.30 0.40 0.50 0.60 0.70 0.0 10.0 20.0 30.0 40.0 50.0 60.0 70.0 80.0 90.0
Slide 17: Consolidated GMV
Consolidated GMV FX Neutral GMV Maintaining Momentum * Excluding Venezuela **Free Sold Items as a % of Sold Items Shipped USD GMV Evolution per Quarter $ 3,075 $ 3,618 $ 3,126 $ 3,135 $ 2,995 $ 2,858 $ 2,995 94% 132% 43% 36% 28% 0 0.2 0.4 0.6 0.8 1 1.2 1.4 0 500 1000 1500 2000 2500 3000 3500 4000 3Q
Slide 18: Consolidated Live Listings
Consolidated Live Listings Live Listings Evolution Driving Consistent Growth in Supply & Assortment * Excluding Venezuela Live Listings Evolution per Quarter (M) $ 111 $ 119 $ 133 $ 155 $ 168 $ 101 $ 168 52% 55% 51% 56% 59% 0.46 0.48 0.5 0.52 0.54 0.56 0.58 0.6 0 20 40 60 80 100 120 140 160 180 3Q17
Slide 19: MercadoPago
MercadoPago On Marketplace Payments growth affected by tougher comps, OFF Platform Payments TPV growing at triple digits reaching a multi - year high of 160 % YoY growth Consolidated TPV ON Consolidated TPV OFF 82% 85% 62% 49% 40% 83% 81% 89% 89% 91% 0 0.1 0.2 0.3 0.4 0.5 0.6 0.7 0.8 0.9 1 0 0.1 0.2
Slide 20: MercadoCredito
MercadoCredito Record credits originations, credit portfolio in USD affected by Argentina FX headwinds Merchant & Consumer Credits Portfolio *TPV OFF as a % of Total TPV Merchant Credits Originations $52 $73 $122 $112 $91 0 20 40 60 80 100 120 3Q17 4Q17 1Q18 2Q18 3Q18 Loans Receivable 12 7 11 12 24
Slide 21: Overview: Financial Metrics
Third Quarter 2018 Overview 1. Quarterly Highights 2. KPIs 3. Financial Metrics 4. Margin Structures
Slide 22: FASB ASC Pro Forma
FASB ASC 606 Pro Forma *As Recast **As Reported
Slide 23: Consolidated Net Revenues
Consolidated Net Revenues $305 $358 $321 $335 $355 $295 $355 $(66) $(79) $(112) $(97) $(108) $(66) $(108) 32% 45% 19% 18% 17% -200.0% -100.0% 0.0% 100.0% -120 -70 -20 30 80 130 180 230 280 330 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17** 3Q18 Net Revenues Shipping USD YoY Growth Revenues per Quarter (M) * Balanc
Slide 24: Net Revenues by Country
Net Revenues by Country LC Revenue Growth * Balances are adjusted to the adoption of ASC 606 ** Excluding Venezuela 68% 40% 71% 56% 44% 51% 68% 56% 168% 43% 58% 64% 0 0.2 0.4 0.6 0.8 1 1.2 1.4 1.6 1.8 Arg Bra Mex Others MELI MELI** 2Q18 3Q18 As Reported *
Slide 25: Consolidated Non-Marketplace Net Revenues
Consolidated Non - Marketplace Net Revenues Revenues per Quarter (M) * Balances are adjusted to the adoption of ASC 606 ** Excluding Venezuela $ 124 $ 160 $ 180 $ 179 $ 175 $ 123 $ 175 28% 50% 96% 72% 41% 0 0.2 0.4 0.6 0.8 1 1.2 0 20 40 60 80 100 120 140 160 180 200 3Q17 4Q17 1Q18 2Q18 3Q18 3Q17** 3
Slide 26: Consolidated Non-Marketplace Revenues Breakdown
Consolidated Non - Marketplace Revenues Breakdown Payments Revenues (M) * Balances are adjusted to the adoption of ASC 606 ** Excluding Venezuela Other Non - Marketplace Revenues (M) $ 32 $ 36 $ 36 $ 35 $ 31 $ 31 $ 31 - 28% - 19% 34% 22% - 2% -0.4 -0.3 -0.2 -0.1 0 0.1 0.2 0.3 0.4 0.5 28 29 30 31 32
Slide 27: Overview: Margin Structures
Third Quarter 2018 Overview 1. Quarterly Highlights 2. KPIs 3. Financial Metrics 4. Margin Structures
Slide 28: Q3 2018 Gross Margin vs. Last Year
Q3 2018 Gross Margin vs. Last Year For comparative purposes , OPEX as a percentage of Gross Billings representen 39.0% this quarter vs 40.0% LY * Others includes : Cost of mPos sales (72 bps), Debit and Credit Taxes (45 bps), net realizable value discounts on mPos devices ( - 674 bps) and other COGS
Slide 29: Q3 2018 EBIT Margin vs. Last Year
Q3 2018 EBIT Margin vs. Last Year 9.0% - 3.1% 9.9 % 1.0% 2.7 % 1.5 % 0.0% 0.4 % 1.1 % 0.3% 2.0 % LY COGS Marketing BPP Bad Debt Chargebacks Other S&M PD G&A S&W Actual 2,8%
Slide 30: Q3 2018 Net Income Margin vs. Last Year
Q3 2018 Net Income Margin vs. Last Year 9.1% - 2.8% 2,2% 2,2% 2,3% 9.9% 0.6% 4,1% LY COGS Opex Interest Income Financial Expenses Forex & Other Tax Actual
Slide 31: Thank You
INVESTOR PRESENTATION Third Quarter 2018 Results Th ank You