Inpost S.a. · EURONEXT:INPST
Inpost — Debt Investor Presentation (June 2021)
52 slides from Inpost's debt investor presentation, Jun 17, 2021
Slide 1: Investor Presentation, 17th June 2021
17th June 2021 Ml investor Presentation a 7
Slide 2: Disclaimer
Disclaimer • IMPORTANT: You must read the following disclaimer before continuing. The following disclaimer applies to this document, the accompanying oral and/or video presentation, if any, of this document by any member of the Group (as defined below) or any entity on behalf of the Company (as defi
Slide 3: Agenda
Agenda 1 Transaction overview 2 Overview of InPost 3 Credit highlights 4 Financial highlights 5 Corporate Governance 6 Appendix 3
Slide 4: Transaction overview
Transaction overview Sources and Uses Sources PLNmm €mm Uses PLNmm €mm Other senior debt 1,818 390 Mondial Relay consideration 2,393 513 New PLN notes 800 172 Transaction fees and expenses 94 20 Repay RCF 117 25 Cash on balance sheet 14 3 Total sources 2,618 562 Total uses 2,618 562 Pro Forma Capita
Slide 5: Combined Group: Pro forma adjusted financials
Combined Group: Pro forma adjusted financials LTM Mar-21 (InPost) and LTM Feb-21 (Mondial Relay) InPost Group Mondial Relay Adjustments PF Adjusted In PLNm Actual Adjusted Revenue1 2,913 1,816 - 4,729 Operating EBITDA 1,122 306 (49)2 1,378 % revenue 38.5% 16.8% - 29.1% Adjusted EBITDA 1,200 316 - 1,
Slide 6: Simplified target pro forma corporate chart
Simplified target pro forma corporate chart1 Investors INPOST S.A. (société anonyme) public company/spółka publiczna InPost Technology S.a.r.l Integer.pl S.A. Integer France SAS Modern Postal Services Ltd (CY) 100% InPost S.A. 100% InPost S.A. 100% - InPost S.A. 100% - Integer.pl S.A. (société anony
Slide 7: Summary indicative financing term sheet for the PLN bond
Summary indicative financing term sheet for the PLN bond Issuer InPost S.A. (Luxembourg) Issue Senior Secured Notes Dealers Bank Pekao S.A., BNP Paribas Bank Polska S.A., ING Bank Śląski S.A. Issue rating [TBC] Programme amount PLN 1bn Estimated issue amount PLN 800m Currency PLN Maturity 6 years NC
Slide 8: Agenda
Agenda 1 Transaction overview 2 Overview of InPost 3 Credit highlights 4 Financial highlights 5 Corporate Governance 6 Appendix 8
Slide 9: InPost at a glance
InPost at a glance #1 e-Commerce enablement platform in Poland, Fast Growing Market with growing operations in the UK +16ppts ~35% 98% Expected increase in Polish APMs as % of total B2C APM market share e-Commerce penetration from parcel volume in Poland in Poland1 ~16k 2019 to 20244 2020E, expected
Slide 10: Focus on InPost: Core business is focused on delivery and returns
Focus on InPost: Core business is focused on delivery and returns, with a recent expansion in warehousing & fulfilment Our competitive “last mile” differentiation New offering Core offering Delivery & Returns Warehousing & Fulfilment First Mile Middle Mile Last Mile Inbound logistics Stock stored in
Slide 11: Focus on InPost: Solving critical challenges of the e-Commerce ecosystem
Focus on InPost: Solving critical challenges of the e-Commerce ecosystem Environ m ent Customer Centric Return Handling Cost Safety Friendly 89% 0 PLN Up to ~66% of shoppers choose Cost for customer to ~25-30% The only 24/ 7 lower CO2 em is s ions in inPost’s APMs as their return purchased items 2 c
Slide 12: Focus on InPost: Proven model of capturing whitespace
Focus on InPost: Proven model of capturing whitespace Increasing locker network density Clear rationale for network densification 2010 Q1 2021 Reasons for never using lockers Gdansk Gdansk Accessibility 73% Poznan Poznan WARSAW WARSAW Lódź Lódź Safety 18% 42% of consumers used an APM that Wroclaw Wr
Slide 13: Focus on Mondial Relay: #1 Out-of-Home parcel shop delivery platform in France
Focus on Mondial Relay: #1 Out-of-Home parcel shop delivery platform in France Business Overview ▪ #2 PUDO market share in France (by volume), focused on Pick-up Drop-Off Mondial Relay has the highest PUDO volumes in France (PUDO) ▪ Large network of ~16k locations1 ▪ Mainly present in France, with g
Slide 14: Focus on Mondial Relay: Existing network and operations
Focus on Mondial Relay: Existing network and operations Distribution Model Territorial coverage Hubs Benelux ✓ ~1,870 4 hubs in France France Growing and profitable business Regional Hubs(1) ~11,000 ~38% PUDO market share in France3 and NPS of 30% ✓ 2 in Benelux and 2 in Iberia Iberia Existing logis
Slide 15: Focus on Mondial Relay: ~€100-150 million of incremental EBITDA enhancements
Focus on Mondial Relay: ~€100-150 million of incremental EBITDA enhancements identified over mid-term ~€100-150m of identified earnings enhancements Network Commercial Operational expected to be realized over mid-term Design Potential Optimisation Operational Optimisation • APM roll-out at new • APM
Slide 16: Focus on Mondial Relay: Rationale for the Mondial Relay acquisition
Focus on Mondial Relay: Rationale for the Mondial Relay acquisition Significantly accelerates InPost’s international expansion strategy and reinforces InPost as Europe’s leading out-of-home 1 (“OOH”) automated solution for e-Commerce Secures immediate footprint in one of Europe’s largest and most at
Slide 17: Creates the #1 Out-of-Home automated solution for e-Commerce
Focus on Mondial Relay: Creates the #1 Out-of-Home automated solution for e-Commerce 1 4 98% APM market share in Poland2 #1 Out-of-Home automated Market position 38% PUDO market share in France7 43% B2C parcel share in Poland2 solution for e-Commerce in Europe Other Other To-Door Other To-Door To-Do
Slide 18: Agenda
Agenda 1 Transaction overview 2 Overview of InPost 3 Credit highlights 4 Financial highlights 5 Corporate Governance 6 Appendix 18
Slide 19: Credit highlights
Credit highlights 1 Attractive markets underpinned by long-term secular growth trends 2 Leader in European Out-of-Home delivery with entrenched market position 3 Diversified business model 4 Sticky blue chip customers with high contracted revenue visibility 5 Unique customer experience with best-in-
Slide 20: Attractive markets underpinned by long-term secular growth trends
1 Attractive markets underpinned by long-term secular growth trends Leading European e-Commerce markets e-Commerce expected growth in Poland and France over 2020-2024 #1 #3 Fastest growing Largest e-Commerce economy in Europe market in Europe (3.0% Real CAGR 2008-20A) (~3x Poland) UK Netherlands ∽10
Slide 21: Leading player gaining share in Poland and France
2 Leading player gaining share in Poland and France #1 B2C parcel player in Poland #2 PUDO player in France B2C market share based on parcel volume PUDO market share based by volume 98% 98% ~2% ~3% ~8% ~5% ~3% ~2% ~5% ~4% ~18% ~15% ~6% ~9% ~11% ~17% ~18% ~44% ~17% ~56% ~28% ~43% 38% ~21% 24% 2017 20
Slide 22: Well-positioned against competitors
2 Well-positioned against competitors APM APM APM To-Door To-Door To-Door To-Door Delivery method To-Door To-Door PUDO PUDO4 To-Door PUDO PUDO PUDO PUDO PUDO PUDO 12k APM / >2k ~200 APM / ~11k PUDO / Locations n.m. n.a. ~11k PUDO ~11k PUDO ~5k PUDO ~4k PUDO PUDO ~12k PUDO ~8k post offices Parcel vol
Slide 23: Diversification across service offerings, geographies and customers
3 Diversification across service offerings, geographies and customers Revenue split PF for Mondial Relay acquisition Delivery type Geography Customer Other To-Door 2% International 17% 21% 39% APM 39% 46% merchants 11% Poland 61% PUDO InPost Other 31% 33% Source: Company information Note: Based on L
Slide 24: Blue chip merchant base
4 Blue chip merchant base >28k InPost merchants 80k Mondial Relay Platforms merchants Domestic SMEs Large Domestic Retailers International Brands Allegro Merchants (incl. Allegro Smart!) Marketplace platforms SME retailers selling Large retailers selling Merchants with direct where individual Descri
Slide 25: Strong momentum growing the merchant base and share of checkouts
4 Strong momentum growing the merchant base and the share of checkouts # of integrated merchants in Poland1: InPost share of checkout Total merchants Avg. new monthly contracts: 1.7k3 ~75% ~35% • APM: 0.7k % of Polish 63% • C2D: 0.6k 26k retailers • Subscriptions: 0.5k 39% 18% 16.7k 11.5k 2017 2018
Slide 26: Close partnership with Allegro
4 Close partnership with Allegro Volume growth (parcels) FY18 - Q1-21 LTM CAGR 35%1 92% Allegro partnership deep dive Market Share 36%2 43%3 Revenue (PLNm) ✓ InPost is key partner and growth accelerator for Allegro, Q1-21 LTM 4,4574 2,9135 crucial to the successful rollout of Allegro Smart! Revenue
Slide 27: Unique customer experience
Best-in-class NPS 5 Unique customer experience 72% for 72% 54% APMs4 InPost APMs (Paczkomaty) for to-door4 59% ✓ Almost 12,000 APMs in Poland, covering 51% 46% of population within only 7 minutes walking time 37% ✓ 24/7 availability 25% ✓ Speed of delivery – 98%+ of parcels delivered 24% within 24 h
Slide 28: Modern and digital e-commerce approach guarantees best delivery experience
6 Modern and digital e-commerce approach guarantees best delivery experience Dynamic courier APM re-load APM location finder Mobile app Multilocker Chatbot routing optimization Automated Driving an increase in Increasing the Managing the Identifying optimal Increasing last mile management volume and
Slide 29: Nationwide networks with highly scalable configuration
6 Nationwide networks with highly scalable configuration to support future growth Gdańsk APM locations facts: Toruń Poznań ✓ Own large team of expanders (50 FTE) Warszaw continuously searching for locations to install APM’s Łódź Wrocław ✓ Secured pipeline of potential locations to Katowice install o
Slide 30: Unrivalled scale and unique ecosystem create significant barriers to entry
6 Unrivalled scale and unique ecosystem create significant barriers to entry High landlord loyalty with a very low lease churn Proprietary ecosystem of hardware and software rates as InPost’s multi-merchant APMs generate larger traffic than APMs of merchants (e.g. Allegro, AliExpress) Cutting-edge t
Slide 31: Strong growth, increasing margins and cash conversion
7 Strong growth, increasing margins and cash conversion... Parcel Volume Revenue1 (m) (PLNm) CAGR: 2,532 CAGR: 310 +85% +93% 93% 99% 1,243 144 98 737 793 83 49 412 0.5 2.2 18 0.4 0.2 1.4 8 7 2 11 2018A 2019A 2020A Q1 2020A Q1 2021A 2018A 2019A 2020A Q1 2020A Q1 2021A International Parcel Volume Inte
Slide 32: Unique economic model with significant operating leverage
7 … driven by a unique economic model with significant operating leverage Superior unit economics with every new cohort of APMs deployed, driving future growth and cash flows Improving utilisation Stronger volume ramp-up Higher returns % Utilisation1 Average monthly parcel volume per APM by cohort %
Slide 33: Multiple avenues for further growth
8 Multiple avenues for further growth Exportable model ~3x penetration by 20243 Expanding InPost’s share of the value chain International >6m2 app users, Expansion >28k merchants2 Effective cost E-grocery avoidance & share of checkout gain Continued innovation in +10-15 ppts. APM service offerings s
Slide 34: With focus on international markets
8 … with focus on international markets Further enhancing the existing business with the opportunity to accelerate APM Targets capabilities internationally over time (France) Near Term2 Mid Term2 Deployment # of APMs Volume growth capacity ~0.1-0.2K ~5.5K #APMs Poland 2013 ~1k <350 ~70% per annum 20
Slide 35: Agenda
Agenda 1 Transaction overview 2 Overview of InPost 3 Credit highlights 4 Financial highlights 5 Corporate Governance 6 Appendix 35
Slide 36: Strong revenue growth and EBITDA margin expansion, improved cash conversion
InPost: Strong revenue growth and EBITDA margin expansion, coupled with improved cash conversion FY FY FY LTM Q1 18-20 Q1 Q1 QoQ In PLNm × 3 2018A 2019A 2020A 2021 CAGR 2020A 2021A growth Tripling in revenue since 2018, Revenue1 737 1,243 2,532 2,913 85% 412 793 93% benefitting from flywheel effect
Slide 37: Poland APM segment: strong APM network development
Poland APM segment: strong APM network development with growing efficiency APM parcel volume (mm) Revenue per APM parcel (PLN) APM revenue 7.5 +111% 7.4 7.3 7.5 7.4 PLNm 247 +114% 1,815 776 103 80 394 588 53 37 279 2018A 2019A 2020A Q1 Q1 2018A 2019A 2020A Q1 Q1 2018A 2019A 2020A Q1 Q1 2020A 2021A 2
Slide 38: Poland To-Door: strong volume growth
Poland To-Door: strong volume growth driven by acceleration in e-commerce penetration To-Door parcel volume (m) To-Door revenue +44% +41% 61 635 PLNm 40 420 30 291 17 174 12 124 2018A 2019A 2020A Q1 Q1 2018A 2019A 2020A Q1 Q1 2020A 2021A 2020A 2021A Revenue per To-Door parcel (PLN) • 2.0x increase i
Slide 39: Poland: productivity gains and economies of scale to drive unit COGS reduction
Poland: productivity gains and economies of scale to drive unit COGS reduction, resulting in a strong gross margin expansion Average COGS per parcel1 Gross profit • Major reduction in unit logistics cost through productivity gains (scale-driven) across first, middle and last miles +120% • APM networ
Slide 40: Poland: operating leverage driving SG&A per parcel reduction
Poland: operating leverage driving 28% CAGR SG&A per parcel reduction and contributing to EBITDA margin expansion Average SG&A per parcel1 Adjusted EBITDA and Margin PLNm PLNm 1,049 45% 295 42% 35% 1.84 185 31% 2 350 151 1.29 0.96 19% 377 145 2018A 2019A 2020A General costs SG&A per parcel 135 • Con
Slide 41: 10x increase in FCF allowing strong deleveraging
InPost: 10x increase in FCF allowing strong deleveraging and capital for further expansion Leverage expected to Significant improvement in conversion driven by surge in Poland EBITDA and lower capex intensity drop below PLNm 3.0x at the end of 2021E and 2.0x-2.5x in (19) 2022E 909 (83) (11) 671 (519
Slide 42: Improving returns profile driving cash conversion improvement
InPost: Improving returns profile driving cash conversion improvement despite accelerating expansion capex In PLNm FY FY FY LTM Q1 18-20 Q1 Q1 QoQ Free Cash Flow1 2018A 2019A 2020A 2021 CAGR 2020A 2021A growth PLNm Adjusted EBITDA 110 352 1,004 1,200 203% 136 332 144% % margin 15% 28% 40% 41% 33% 42
Slide 43: Agenda
Agenda 1 Transaction overview 2 Overview of InPost 3 Credit highlights 4 Financial highlights 5 Corporate Governance 6 Appendix 43
Slide 44: InPost S.A. Corporate Governance
InPost S.A. Corporate Governance Management Board Headquarters Others 70 Route d'Esch, LU-1470 Luxembourg The Capital 36.48% Rafał Brzoska Group ▪ Founder and Group CEO since Companies February 2007 Shareholders Inc 5.25% ▪ More than 21 years of experience in Since January 2021, 500m of logistics, t
Slide 45: Agenda
Agenda 1 Transaction overview 2 Overview of InPost 3 Credit highlights 4 Financial highlights 5 Corporate Governance 6 Appendix 45
Slide 46: NPS of InPost Poland vs. competitors
04.2020 58 70 04.2020 10.2020 66 62 04.2021 10.2020 71 APM service: Pick up 04.2021 72 04.2020 Source: Kantar 10.2020 29 29 04.2021 20 04.2020 10.2020 23 22 04.2021 12 04.2020 64 10.2020 04.2020 70 9 Send 10.2020 16 04.2021 74 04.2021 (4) NPS of InPost Poland vs. competitors 04.2020 10.2020 15 18 04
Slide 47: A greener solution for increasing e-Commerce delivery volumes
A greener solution for increasing e-Commerce delivery volumes reducing pollution and congestion Our offering aligns with the goals of cities and e-tailers looking to reduce their impact on the environment An attractive proposition for e-tailers and cities focused >73k tons of CO2 savings/100m parcel
Slide 48: We are committed to drive the adoption of a more sustainable form of delivery
We are committed to drive the adoption of a more sustainable form of delivery A greener solution “Green City” program and Governance for delivery services partnerships with local governments Reduction of CO2 emissions through use and Serving the community and creating greener Create a diverse work e
Slide 49: Accelerating the flywheel effect to drive sustainable long-term growth
Accelerating the flywheel effect to drive sustainable long-term growth Our Customers Merchants End-Users Value-enhanced offering driving repeat sales Greater Best-in-class experience with clear brand and end-user stickiness 1 convenience recognition Growth • Ease of process / delivery • Cost advanta
Slide 50: International segment: improved EBITDA margin despite significant investments
International segment: improved EBITDA margin despite significant investments, early signs of flywheel effect In PLN m FY 2018A FY 2019A FY 2020A Q1 2020A Q1 2021A 18-20 CAGR QoQ growth • APM network since 2019 # of APMs 1,257 1,166 1,478 1,176 1,810 8% 54% have been constantly increasing as a resul
Slide 51: International segment: ongoing network expansion
International segment: ongoing network expansion supported by positive merchants reception and increased locker utilisation UK parcel volume (m) International revenue +600% +154% +455% PLNm 18 1.4 1.0 2 11 0 0.5 0.5 0.2 7 15 Q1 2020A Q2 2020A Q3 2020A Q4 2020A Q1 2021A 2 2 5 International APM networ
Slide 52: Financial policy
Financial policy Debt and ▪ Revenue growth combined with improving EBITDA margins will contribute to strong free cash flow generation supporting deleveraging Leverage ▪ Net leverage pro forma for the Mondial Relay acquisition remains low at 3.5x based on PLN 1,519m Feb’21 PF LTM adjusted EBITDA Cont