Slide 1: Leading Online Marketplaces in Emerging Markets
LEADING ONLINE MARKETPLACES IN EMERGING MARKETS STRATEGIC ACQUISITIONS AND CAPITAL RAISING | 8 OCTOBER 2020 NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 2: Important Notices and Disclaimer
IMPORTANT NOTICES AND DISCLAIMER Important notices and disclaimer This investor presentation (Presentation) is dated 8 October 2020 and has been prepared by Frontier Digital Ventures Ltd (ABN 25 609 183 959) (Frontier). By attending an investor presentation or briefing, or accepting, accessing or re
Slide 3: Important Notices and Disclaimer (Cont.)
IMPORTANT NOTICES AND DISCLAIMER (CONT.) The retail offer booklet for the Retail Entitlement Offer will be available following its lodgement with ASX. Any eligible retail shareholder in Australia or New Zealand who wishes to participate in the Retail Entitlement Offer should consider the retail offe
Slide 4: Important Notices and Disclaimer (Cont.)
IMPORTANT NOTICES AND DISCLAIMER (CONT.) Disclaimer Bell Potter Securities Limited (ABN 25 006 390 772) and Morgans Corporate Limited (ABN 32 010 539 607) are acting as joint lead managers (Joint Lead Managers) to the Offer. To the maximum extent permitted by law, Frontier and the Joint Lead Manager
Slide 5: Table of Contents
NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES TABLE OF CONTENTS TABLE OF CONTENTS 1 Executive summary 2 Overview of acquisitions 3 Strategic rationale 4 FDV trading update 5 Capital raising details 6 Appendix 5
Slide 6: Executive Summary
EXECUTIVE SUMMARY • Frontier Digital Ventures (‘FDV’) is acquiring from Adevinta1 100% of the issued capital of: Summary of the — Fincaraíz, the leading real estate classifieds portal in Colombia — Avito and Tayara, the leading general classifieds businesses in Morocco and Tunisia acquisitions • Tot
Slide 7: Overview of Acquisitions
OVERVIEW OF ACQUISITIONS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 8: The FDV Mission
THE FDV MISSION NEW ACQUISITIONS “ Become the leading global operator of online marketplace businesses in #1 real estate portal Colombia #1 general marketplace Morocco #1 general marketplace Tunisia emerging markets. ” #1 property portal Leading general marketplace #1 property portal Uruguay, Pakist
Slide 9: Portfolio of Market Leading Businesses
PORTFOLIO OF MARKET LEADING BUSINESSES Highly strategic acquisitions in existing and adjacent geographies #1 #1 #1 #1 #1 #1 #1 #1 #1 #1 #1 #1 #1 #1 #1 CENTRAL & SOUTH AMERICA AFRICA DEVELOPING ASIA • Fincaraíz provides strategic link across • Strengthens existing position in Morocco • FDV has establ
Slide 10: Significant Contribution to FDV Share of Revenue
SIGNIFICANT CONTRIBUTION TO FDV SHARE OF REVENUE Illustrative 2019 Revenue FDV Ownership Operating Company (FDV unaudited pro forma, A$m) (Current) Classifieds Type Zameen 12.7 30% Property Fincaraíz 8.5 100% Property Avito 8.0 100% General Encuentra24 3.4 26% General InfoCasas 2.0 52% Property Ta
Slide 11: Fincaraíz
FINCARAÍZ The #1 real estate portal in Colombia Revenue FINCARAÍZ OVERVIEW: • Leading real estate marketplace in terms of users, clients, content and brand in Colombia 2019: A$8.5m 2017-19 CAGR: 3% • Leadership position underpinned by strong brand recognition across Colombia and large number of high
Slide 12: Avito
AVITO The #1 general classifieds portal in Morocco Revenue AVITO OVERVIEW: 2019: A$8.0m • #1 general classifieds player in Morocco with leading position across general, auto, real estate 2017-19 CAGR: 6% • Experienced leadership team has built the brand to become a household name in Morocco 1H 2020:
Slide 13: Tayara
TAYARA The #1 general classifieds portal in Tunisia Revenue TAYARA OVERVIEW: 2019: A$1.0m • Online marketplace with strong brand recognition across general classifieds, real estate and jobs 2017-19 CAGR: 31% • Operates three different marketplaces being Tayara.tn (general classifieds), ImmoExpert (f
Slide 14: Exposure to Large Growing Markets
EXPOSURE TO LARGE GROWING MARKETS Attractive macro thematics to support growth in online marketplaces MOBILE INTERNET POPULATION1 GDP GROWTH2 CONNECTIONS1 PENETRATION1 Colombia (adjacent market) 51m 2.7% 119% 69% Morocco (existing market) 37m 3.7% 118% 69% Tunisia (adjacent market) 12m 2.5% 151% 64%
Slide 15: A Timely Opportunity for FDV
A TIMELY OPPORTUNITY FOR FDV Adevinta focused on portfolio optimisation– following the recent announcement of its US$9.2 billion acquisition of eBay’s Classifieds Group FDV’s strong track record in emerging markets – creates an opportunity to support growth and optimise performance of the acquired b
Slide 16: Strategic Rationale
STRATEGIC RATIONALE NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 17: Acquisition Highlights
ACQUISITION HIGHLIGHTS Material financial contribution 1 Acquisitions increase 2019 pro forma FDV ownership revenue by 78% Positive EBITDA Strong strategic fit 2 Consistent with FDV's goal to own leading online classifieds #1 real estate portal in in 2019 businesses in emerging markets Colombia 23.8
Slide 18: 1. Material Financial Contribution
1. MATERIAL FINANCIAL CONTRIBUTION New acquisitions increase 2019 pro forma FDV ownership revenue by 78% Revenue growth since IPO (A$m, pro forma unaudited; FDV% basis) 39.8 1.0 8.0 8.5 22.3 14.0 Material contribution from new businesses, which increase 2019 pro forma 8.5 FDV ownership revenue by 78
Slide 19: 2. Strong Strategic Fit
2. STRONG STRATEGIC FIT Extending market leadership in the target regions PORTFOLIO • • Clear market leadership Second highest contribution to FDV • • Clear market leadership Third highest contribution to FDV • • Clear market leadership Sixth highest contribution to FDV IMPACT equity share of revenu
Slide 20: 3. Significant Upside Potential
3. SIGNIFICANT UPSIDE POTENTIAL Leverage FDV’s playbook and management expertise to optimise new businesses Support and empower local teams FDV has a proven track record of increasing the equity value of its Establish operational structures and best-practice strategies operating companies Unlock rev
Slide 21: Case Study – InfoCasas
CASE STUDY – INFOCASAS The FDV playbook in action – apply deep classifieds knowledge to drive self-sufficiency Revenue and EBITDA A$000, 100% ownership basis Since FDV investment Increase ownership to Revenue CAGR: +111%1 +50% once business Traffic growth: +97%2 becomes self-sufficient ✓ Unlock anci
Slide 22: Case Study – AutoDeal
CASE STUDY – AUTODEAL The FDV playbook in action – apply deep classifieds knowledge to drive self-sufficiency Revenue and EBITDA A$000, 100% ownership basis Since FDV investment Increase ownership to Revenue CAGR: +44%1 +50% once business Traffic growth: 36%2 becomes self-sufficient ✓ Launch new pro
Slide 23: 3. Significant Upside Potential (Cont.)
3. SIGNIFICANT UPSIDE POTENTIAL (CONT.) Consolidating ownership of proven businesses Since its IPO in 2016, FDV has consistently executed on its goal to increase ownership levels of the strongest operating companies in its portfolio, with a clear focus on self-sufficiency Facilitating transactions a
Slide 24: 4. Greater Scale and Diversification
4. GREATER SCALE AND DIVERSIFICATION Further diversification across key regions and verticals to strengthen risk-return profile REVENUE BY GEOGRAPHY REVENUE BY VERTICAL REVENUE BY BUSINESS (2019A, FDV basis) (2019A, FDV basis) (2019A, FDV basis) MENA 4% General LATAM MENA 15% General Other Zameen 24
Slide 25: 5. Accelerates Strategic Evolution
5. ACCELERATES STRATEGIC EVOLUTION FDV ownership evolving towards greater control Portfolio composition since IPO Ownership levels increasing over time FDV Number of operating companies1 FDV ownership @ IPO / ownership Operating company time of purchase (current) # portfolio companies2 31.3% 52.1% 0
Slide 26: Track Record of Delivering Shareholder Value Through Acquisition
TRACK RECORD OF DELIVERING SHAREHOLDER VALUE THROUGH ACQUISITION “ FDV’s portfolio of market leaders is well placed in the current environment, as the power of incumbency increases, and market leaders become more dominant. FDV’s reputation as a strategic partner for online classifieds businesses in
Slide 27: FDV Trading Update
FDV TRADING UPDATE NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 28: Key Profitability Inflection Point Achieved
KEY PROFITABILITY INFLECTION POINT ACHIEVED Current FDV portfolio (ex. acquisitions) EBITDA positive across July and August 2020 Portfolio EBITDA margin1 (%, FDV basis) Half year Months2 1H16 2H16 1H17 2H17 1H18 2H18 1H19 2H19 1H20 Jul-Aug 20 2% (4%) (5%) (5%) (19%) COVID-19 (22%) impact (32%) (51%)
Slide 29: Strong EBITDA Performance, Despite COVID-19
STRONG EBITDA PERFORMANCE, DESPITE COVID-19 All operating companies recorded positive or improved EBITDA across July and August 2020 FDV Jul-Aug 2020 2Q 2020 current ownership EBITDA2 EBITDA EBITDA change on 2Q 2020 (%) A$ (FDV basis) A$ (FDV basis) (in absolute terms) AutoDeal 56% 40,071 47,922 Z
Slide 30: Capital Raising Details
CAPITAL RAISING DETAILS NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 31: Capital Raising Overview
CAPITAL RAISING OVERVIEW ▪ Non-underwritten Institutional Placement (“Placement”) and non-underwritten 1 for 9 Pro-Rata Accelerated Non-Renounceable Entitlement Offer (“Entitlement Offer”) to raise up to A$100m — Placement to raise up to $63.4m via the issue of up to 50.7 million New Shares (equival
Slide 32: Indicative Timetable
INDICATIVE TIMETABLE Enter trading halt Wednesday, 7 October 2020 Placement opens Wednesday, 7 October 2020 Placement closes Thursday, 8 October 2020 Announcement of acquisitions and capital raising Thursday, 8 October 2020 Accelerated Non-Renounceable Entitlement Offer opens Thursday, 8 October 202
Slide 33: Appendix
APPENDIX NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES
Slide 34: Strong Track Record of Long Term Value Creation
STRONG TRACK RECORD OF LONG TERM VALUE CREATION • One of the top global online classifieds executives with a strong track record of long-term value creation • Former CEO of iPropertyGroup (ASX: IPP) and General Manager at REA Group • Spearheaded the transformation of iProperty Group from a US$15m sm
Slide 35: Corporate Overview
CORPORATE OVERVIEW FDV has a strong balance sheet, and its shares are tightly held Share price performance (last 12 months) Substantial shareholders 1.70 Catcha Group (Patrick Grove and Luke Elliott) 33.4% 1.50 Shaun Di Gregorio (Founder and CEO) 14.1% Smallco Investment Manager 8.2% 1.30 Barca Glob
Slide 36: Key Risks and International Offer Restrictions
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS 1. KEY RISKS COVID-19 Events related to the Coronavirus pandemic (COVID-19) have resulted in significant market volatility. There is continued uncertainty as to ongoing and future response of governments and authorities globally as well as a likelihood
Slide 37: Key Risks and International Offer Restrictions (Cont.)
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS (CONT.) RELIANCE ON SYSTEM AND CONTENT INTEGRITY The performance of the websites of Frontier’s Operating Companies is very important to the reputation of those Operating Companies, their ability to attract customers and their ability to achieve overall
Slide 38: Key Risks and International Offer Restrictions (Cont.)
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS (CONT.) RISKS ASSOCIATED WITH INVESTMENT INTO OPERATING COMPANIES AND PROVISION OF INFORMATION Although Frontier performed due diligence on the Operating Company and assets and founders of the relevant business when acquiring an interest in the relevant
Slide 39: Key Risks and International Offer Restrictions (Cont.)
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS (CONT.) HACKING AND VANDALISM The businesses of the Operating Companies may be adversely affected by malicious third party applications that interfere with, or exploit, security flaws in their websites. If an Operating Company’s efforts to combat these
Slide 40: Key Risks and International Offer Restrictions (Cont.)
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS (CONT.) RISKS ASSOCIATED WITH AN INVESTMENT IN SHARES There are general risks associated with investments in equity capital. The trading price of Frontier shares may fluctuate with movements in equity capital markets in Australia and internationally. Th
Slide 41: Key Risks and International Offer Restrictions (Cont.)
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS (CONT.) FRONTIER WILL ASSUME EACH OF FINCARAÍZ, AVITO AND TAYARA HISTORICAL LIABILITIES Following completion of the Acquisitions, Frontier may become responsible (subject to the terms of the relevant acquisition agreement) for any outstanding liabilitie
Slide 42: Key Risks and International Offer Restrictions (Cont.)
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS (CONT.) 3. INTERNATIONAL OFFER RESTRICTIONS This document does not constitute an offer of new ordinary shares ("New Shares") of Frontier in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person
Slide 43: Key Risks and International Offer Restrictions (Cont.)
KEY RISKS AND INTERNATIONAL OFFER RESTRICTIONS (CONT.) UNITED KINGDOM Neither this document nor any other document relating to the offer has been delivered for approval to the Financial Conduct Authority in the United Kingdom and no prospectus (within the meaning of section 85 of the Financial Servi
Slide 44: Visit Us
HERE VISIT US frontierdv.com Follow us on social media PRINCIPAL OFFICE 39-8 The Boulevard Mid Valley City, Lingkaran Syed Putra Kuala Lumpur, Malaysia NOT FOR DISTRIBUTION OR RELEASE IN THE UNITED STATES