W.a.g. Payment Solutions Plc · LSE:EWG
W.a.g. Payment Solutions — Eurowag — Investor Day (October 2023)
77 slides from W.a.g. Payment Solutions's investor day presentation, Oct 11, 2023
Slide 1: Eurowag Capital Markets Day
Eurowag Capital Markets Day 11 October 2023 1
Slide 2: Disclaimer
Disclaimer This presentation comprises certain written materials/slides prepared by W.A.G payment solutions plc (the Company) for the purposes of the Company’s Capital Market’s Day event. This document, its contents and the presentation may not be copied, distributed, published, reproduced or passed
Slide 3: Agenda
Agenda Strategic overview Martin Vohánka CEO and Founder Martin Vohánka CEO and Founder Commercial strategy Miroslav Novák Country Manager CZ/SK Break Product and platform Martin Strigač Chief Product Officer Financial update Oskar Zahn Chief Financial Officer Martin Vohánka CEO and Founder Q&A and
Slide 4: Strategic overview
Strategic overview Martin Vohánka CEO and Founder
Slide 5: Our vision has never changed, a journey to an integrated end-to-end digital platform
Our vision has never changed, a journey to an integrated end-to-end digital platform Key: Payment provider for Digital provider Payments and End-to-end integrated Payments energy and toll payments of services financing provider digital platform Products and services Financing Load and dispatch Soft
Slide 6: Trucking is an essential pillar of the economy
Trucking is an essential pillar of the economy Transport split as % share European CRT Trucks in gross tonne km 6% € 9m Heavy commercial vehicles – International 10% - 15% • >12 tonne 19% • ~130,000km p.a. mileage 75% >9m ~5% ~20m Heavy commercial vehicles – Domestic Commercial of European CRT2 rela
Slide 7: Eurowag's growing addressable market in Europe
Eurowag’s growing addressable market in Europe Net revenue €bn Addressable market at IPO • €4.4bn payment solutions (2020) Financing services driven expansion €1.5bn C A • €1.5bn mobility solutions (2020), of which: Financing and e-wallet − €0.9bn Tax, €0.5bn short term financing, €0.1bn FMS Expansi
Slide 8: The CRT industry needs a digital and operational transformation
The CRT industry needs a digital and operational transformation Low Low Environmental Analogue Complex Fragmented Constrained utilization profitability impact <13% 30+ >90% Limited 30% 3-5% 9% of road transport administrative tasks of operators are access to finance trucks on the road margins of gre
Slide 9: Connecting the CRT industry together into one transparent digital ecosystem
Connecting the CRT industry together into one transparent digital ecosystem Fragmented CRT1 ecosystem Shippers, Freight Energy Finance & Original equipment Regulators Roadside service forwards & Load & toll payments insurance manufacturers & authorities providers platforms Creating transparency Fair
Slide 10: Design of Eurowag's integrated end-to-end digital platform
Design of Eurowag’s integrated end-to-end digital platform Our purpose Customers To make Businesscommercial owner Truck driverroad transport Fleet dispatcher clean, fairPartners, Merchants, and efficient Authorities & Shippers Attract Engage Monetise Retain Sales channels Direct Indirect Digital Pri
Slide 11: Creation of an industry first data platform supporting transformation
Creation of an industry first data platform supporting transformation Truck Truck, trailer, routing, information position, utilisation etc Driver Social, behaviour, information compliance, etc Capturing ALL our customers data = Company Toll, tax refund, 1) Driving total digitisation of a information
Slide 12: Our journey to an integrated end-to-end digital platform
Our journey to an integrated end-to-end digital platform 2023+ 2017 2022 3 Integration Delivering unique integrated end-to-end 1995 2016 2 Accumulation platform, driving efficiency and supporting decarbonisation Acquiring and developing a broader 1 Expansion suite of services, with data at the core
Slide 13: Maximising returns through M&A and innovation
Maximising returns through M&A and innovation Growing shareholder value Growth 1 EBITDA (€m) Czechia Iberia (PT) Hungary Expanding into new markets and acquiring customer portfolios Slovakia Poland Romania Slovenia Croatia Serbia 81.6 CAGR: 33.8% 69.7 2 Capability1 58.6 EETS Navigation WTM Technolog
Slide 14: Our unique offering has enabled us to substantially differentiate ourselves
Our unique offering has enabled us to substantially differentiate ourselves INTERNATIONAL MISSION CRITICAL SERVICE Pan PROVIDERS European Regional Point Solutions Integrated experience 14
Slide 15: Uniquely positioned in the public market
Uniquely positioned in the public market Integrated Supply Chain / Payments Logistics Software Legacy Fleet Cards 15
Slide 16: Our three-year goals: Integration and transformation
Our three-year goals: Integration and transformation Soft launch of FY 2023 FY 2024 our platform FY 2025 FY 2026 • Unify teams from acquired businesses PEOPLE • Foster digital expertise and agility • Create an agile sales force, integrated into an omnichannel ecosystem • Integrate all products into
Slide 17: Our strategic pillars allows for structured and effective execution
Our strategic pillars allows for structured and effective execution within a very complex environment Our purpose To make commercial road transport clean, fair and efficient Attract Engage Monetise Retain Strategic pillars Be in every truck Drive customer centricity Grow core services Expand platfor
Slide 18: Lack of industry digitisation led to building strong direct channel
Attract Lack of industry digitisation led to building strong direct channel Today Ambition Direct Indirect Direct Indirect Digital Building a customer-centric omnichannel Digital • 95% of sales via Direct channel • Thriving indirect and over 50% customers onboarded digitally • ~ €500 cost to acquire
Slide 19: Bringing Data / AI into one platform for efficiency gains
Engage Bringing Data / AI into one platform for efficiency gains Today Ambition Loads Multiple systems Driver Driver Energy & Tolls integrated Fleet Mgmt. Owner platform Owner Financing Accountant Accountant Transport Mgmt. Freight forwarder € Freight forwarder Accounting & Report. Shipper Shipper D
Slide 20: Integrating sales forces and products into one platform creates unique cross-sell engine
Monetise Integrating sales forces and products into one platform creates unique cross-sell engine Today Ambition • Lead campaigns drive cross-sell opportunities between businesses • Omnichannel integrating Agile sales, Digital and Indirect • Products stand alone, mix of subscription • Simplified pri
Slide 21: Bringing all brands and UX into one for a seamless digital customer experience
Monetise Bringing all brands and UX into one for a seamless digital customer experience Today Ambition Many… … to one with soft launch of platform in FY24 21
Slide 22: Simplicity, bundled pricing, subscription and financing fees underpinning revenue growth
Retain Simplicity, bundled pricing, subscription and financing fees underpinning revenue growth Today Future Transaction-based revenue model Standard TAX Basic Premium Energy payments Toll payments Tax refund SUBSCRIBE Subscription based revenue model + financing + financing + financing Vehicle info
Slide 23: Our new platform will unlock significant value for our customers and industry
Our new platform will unlock significant value for our customers and industry Continue to grow With new capabilities Efficiency Cashflow Revenue Carbon and convenience improvements improvements reduction Today: Financing: Loads: Decarbonisation: cost savings working capital improved fleet utilisatio
Slide 24: Our sustainability strategy
Our sustainability strategy 24
Slide 25: Embedding sustainability into the organisation is key to achieving our purpose
Embedding sustainability into the organisation is key to achieving our purpose and delivering our corporate strategy Our purpose To make commercial road transport clean, fair and efficient Attract Engage Monetise Retain Strategic pillars Be in every truck Drive customer centricity Grow core services
Slide 26: How we will deliver on our promise
How we will deliver on our promise To make commercial road transport clean, fair and efficient Embed sustainability across all our business activities, focusing on four strategic areas Climate action Customer success & wellbeing Community impact • Reducing our direct GHG emissions • Helping SME tran
Slide 27: Decarbonisation regulatory landscape and targets
Decarbonisation regulatory landscape and targets EU targets for reducing CO₂ emissions from heavy-duty vehicles1 Vehicle manufacturers with targets to phase out diesel2 Truck manufacturers’ timetable to achieve net zero carbon emissions 45% 65% 90% 2030 2035 2040 Transition to alternative fuels will
Slide 28: Eurowag, two complementary commitments to decarbonisation
Eurowag, two complementary commitments to decarbonisation By 2030 Carbon avoidance Reduce our customers GHG Fleet management: Improve driving behaviour and optimise routes emissions intensity Loads: utilising empty journeys per tkm by Driver´s apps to optimise driving style 20% CO2 calculator and re
Slide 29: Summary of our ambitions
Summary of our ambitions Integration and transformation Connect ~1m trucks Reposition Eurowag as the go-to-business for anyone within the trucking ecosystem Move to >60% revenues from subscription and >20% financing Improve customers revenues and empower them to realise efficiencies Enable a reducti
Slide 30: Commercial strategy
Commercial strategy Martin Vohánka CEO and Founder Miroslav Novák Country Manager CZ & SK 30
Slide 31: Our customer's journey on the road is complex
Our customer’s journey on the road is complex, but critical in order to keep our world moving 31
Slide 32: Market size and our focus on international carriers
Market size and our focus on international carriers 51% (2-10 trucks) 1.5m 9M 14% International (11-50 trucks trucks1 trucks) Market size Share of (trucks) total trucks 34% 1% (1 truck) (50+ trucks) EW developed markets: 2.3m 2.3m 26% CEE + Iberia EW growing markets: 2.4m 27% Baltics + SEE + Turkey
Slide 33: A diversified customer base, with significant opportunities to expand and scale
A diversified customer base, with significant opportunities to expand and scale Net revenue geographic split1 Other 3% Southern cluster 38% Central cluster 50% 19% 21% 15% 16% 9% 14% Western cluster 5% • ~250k active payment and connected trucks • 18,053 average active payment solutions customers ac
Slide 34: Developed market
Developed market Miroslav Novák Country Manager CZ & SK
Slide 35: Our sales and commercial colleagues
Our sales and commercial colleagues 18 Offices >600 colleagues 35
Slide 36: Our "Hook" strategy
Our “Hook” strategy evolving from energy to multiple entry points 1 …then financing We hook customers with Energy and FMS1 2 … Resulting in a virtuous sales cycle 4 3 …Then Toll, Tax Refund, Transport Management, Work time management, Smart Routing, Other Adjacent Services… Note: (1) FMS, Fleet Mana
Slide 37: Digital sales enabling faster customer growth and capturing cross sell opportunity
Digital sales enabling faster customer growth and capturing cross sell opportunity • Pilot of Indirect sales cooperation started • Launch of digital sales in SK creates seamless customer journey with digital onboarding process • Launch of Czech toll through direct and digital sales channels • Automa
Slide 38: Cross sell improves margins, reduces churn and improves net revenue retention
Cross sell improves margins, reduces churn and improves our net revenue retention Average number of services per customer1 Increase in share of wallet and reduces churn1 …driving strong retention 3.5 16.8% 3.4 3.3 3.2 8.4% 7.1% 3.1 >110% Average Net Revenue Retention2 2.7% 3 2.9 1 2 3 4 5 1 product
Slide 39: Gaining market share in developed markets, with further cross-sell opportunities
Gaining market share in developed markets, with further cross-sell opportunities Number of Customers (000’s)1 Customers taking more than four products1 Net Revenue (€m)1 51.2 988 936 8.3 909 848 41.0 7.7 35.8 630 32.5 6.6 6.5 6.0 467 339 365 2019 2020 2021 2022 H1 2023 2019 2020 2021 2022 2019 2020
Slide 40: Future of commercial
Future of commercial Martin Vohánka CEO and Founder 40
Slide 41: Building a customer-centric omnichannel; consistent experience across all channels
Building a customer-centric omnichannel; consistent experience across all channels Unified sales strategy Sales strategies are integrated across all channels Combines support and sales, ensuring Enhanced Integrated Connects all stages of the customer’s the best possible customer experience support c
Slide 42: Digital sales accelerates cross sell and new customer acquisitions
Digital sales accelerates cross sell and new customer acquisitions Digital marketing Digital acquisition Medium-large companies Small companies | OFFICE Direct sales Digital monetization Manual onboarding CRM marketing Advisory sales Measure Automate Prioritise Ambition Digital Data • Thriving indir
Slide 43: Indirect channel – OEM deals new to truck infotainments
Indirect channel – OEM deals new to truck infotainments Three out of six OEM deals signed >40% new medium and heavy trucks market share Digital touch-point in the truck, starting with navigation 43
Slide 44: Summary
Summary Commercial strategy Expand market share in developed and developing markets through cross-sell and new acquisitions Reduce cost of acquisition through indirect and digital channels New digital office and OEMs opens further opportunities and accelerates cross sell and new customer acquisition
Slide 45: Refreshment break
Refreshment break Copyright ©2023 W.A.G payment solutions plc 45
Slide 46: Product and platform
Product and platform Martin Strigač Chief Product Officer 46
Slide 47: Medium and heavy trucks account for more than 75% of all inland transports in Europe
Medium and heavy trucks account for more than 75% of all inland transports in Europe (Berg Insight, 2021) Fragmented Complex Small Analogue profits Constrained Driver 47 shortages
Slide 48: Highly regulated industry with national exceptions
Highly regulated industry with national exceptions EU Mobility Package 1 EU Mobility Package 2 EU Mobility Package 3 Europe on the move Clean Mobility Sustainable Mobility • Driving and rest time regulation • Access to the bus and coach market • CO2 standards for Heavy Duty Vehicles • Posting of dri
Slide 49: The process and workflow of a carrier
The process and workflow of a carrier Shipper Freight Forwarder Consignee Multi-modal Traditional / international Digital Freight exchange & platform Carrier Load Carrier Offer Transport Transport Transport Proof of Invoicing & Freight Audit Offer Application Acceptance Order Planning Execution Deli
Slide 50: | OFFICE
| OFFICE 50
Slide 51: Where many become One
| OFFICE Where many become One RAEMON TAX 51
Slide 52: Together we make commercial road transport clean, fair, and efficient
| OFFICE | OFFICE Together we make commercial road transport clean, fair, and efficient 52
Slide 53: Because we care about your problems
| OFFICE | OFFICE Because we care about your problems 53
Slide 54: Eurowag Dashboard
Ev EUROWAG Dashboard a Dashboard Q Smart search (9) Live operations v Live operations : © Finance ry Optimize your fle TJ Transport management real-time data, GL Fleetmanagement Toll management = [ insignts «Reporte ® sottings collve Assistance Documents Shop Fuelcards Telematics Toll__ Vehicle acce
Slide 55: Copyright ©2023 W.A.G. Payment Solutions
Copyright ©2023 W.A.G. Payment Solutions 55
Slide 56: Dispatcher board
© © Dispatcher board x PP @ Szilvia Andréssy Eurotrans a. Sf acd filter Iday 3days Ss @@® Empty mileage @i@ “Loads” 6 $s <p 225 Monday 18.09.2023 Tuesday 19.09.2023, Wednesday 20.09.2023 Thursday 21.09.2023 Friday 22.09.2023 KPI see OF sep 0 06 08 6 030609 8 | 0s 06 oo 6 1s woo 06 oop BAOOIRT gy dor
Slide 57: Copyright ©2023 W.A.G. Payment Solutions
Copyright ©2023 W.A.G. Payment Solutions 57
Slide 58: Just connect your trucks and let us guide you!
| OFFICE Just connect your trucks and let us guide you! 58
Slide 59: Direct, Indirect, Digital services
| OFFICE Direct Indirect Digital • Office Web Portal • Office App • Navigation • Transport management • Financing and Payments • Fleet management • Tax • Work time management • Toll • Customer data base • Ordering services • Reporting • Pricing services • Document management • Location based service
Slide 60: Enhancing our services through eWallet
Enhancing our services through eWallet Integrated digital front-end Financing • Balance management • Various liquidity / credit lending business • Currency conversion (FX) • Bank connectors services • Transaction processing • AML checks • Balance settlement • Regulatory reporting eWallet • Collectio
Slide 61: Combining transactional and subscription business models
Combining transactional and subscription business models Standard • Freemium business model Basic Premium • Subscription-based bundles • Gamification • Loyalty program + financing + financing + financing SUBSCRIBE Ambition • >60% revenue contribution from subscription • >20% financing revenues 61
Slide 62: EW | Office – customer segments
EW | Office – customer segments Our focus on a path to 1 million trucks in Europe Primary focus Secondary focus International Domestic Customer segments we will Company profile Transportation Transportation not focus on: • Construction Micro SME MID TO LARGE • Agriculture Fleet size (<10 vehicles) (
Slide 63: Digital platform roadmap
Digital platform roadmap Product DESIGN and PILOT phase LIVE phase • Map customer journeys • Continue to improve integrated front end to support customer journeys • Design and develop of digital channel touch points • Roll out digital sales channel across Europe • Collaborate with Automotive OEMs to
Slide 64: | OFFICE
Shipper Freight Forwarder Consignee Multi-modal Traditional / international Digital Freight exchange & platform Carrier Load Carrier Offer Transport Transport Transport Proof of Invoicing & Freight Audit Offer Application Acceptance Order Planning Execution Delivery Collection | OFFICE
Slide 65: Financial update
Financial update Oskar Zahn Chief Financial Officer 65
Slide 66: Strong growth through organic and inorganic investment
Strong growth through organic and inorganic investment Net revenue (€m) Adjusted EBITDA (€m) 73.7 114.6 128.6 153.1 190.9 258 35.1 41.1 45.6 45.5 42.8 Margin (%) 111 CAGR: 28.5% CAGR: 33.8% 56.0 40.1 34.5 33.4 46.7 81.6 16.4 134.8 69.7 113.1 58.6 94.1 47.1 50.2 81.2 72.4 57.3 25.9 2018 2019 2020 202
Slide 67: Diversified our revenue mix, shifting to subscription model
Diversified our revenue mix, shifting to subscription model % of net revenue • Diversified / de-risked our revenue mix 26% 29% • Fuel revenue contribution to Group moved from 60% 39% in FY21 to just over 40% today ~43% • Toll revenue contribution to Payments is 21%; EU toll revenue expected to doubl
Slide 68: Investing in people and technology
Investing in people and technology % of net revenue (€m) • Invested in talent and attracting the right skills for our 62.0% 57.0% 69.0% 67.0% 66.2% new business model 127.7 • Technology Opex grew as a reflection of our technology transformation, cloud transition and ERP 9.8 implementation 106.2 • Ot
Slide 69: Heavy investment phase; working towards the delivery of our integrated digital platform
Heavy investment phase; working towards the delivery of our integrated digital platform (€m) 129.4 23.2 70.1 104.3 297 M&A Capex1 273.5 100.2 60.1 38.9 44.2 52.3 29.2 23.2 31.2 23.6 35.6 2019 2020 2021 2022 H1 2023 H2 2023E² 2024E² Net 2.7 0.9 3.8 0.03 2.9 debt Notes: (1) Capex includes proceeds fro
Slide 70: Capital transformation programme investing in the platform
Capital transformation programme investing in the platform and on track to complete end of FY23 Capital expenditure (€m) Organic ordinary capex % 4.0% 7.0% 9.0% 7.0% 7.0% Net Revenue(1) 43.2 11.0% Ordinary capex incl. acquisitions % Net Revenue Enhancing our sales channels 33.8 • Enhancing our custo
Slide 71: Strong cash flow conversion, stable working capital
Strong cash flow conversion, stable working capital Adj. operating cash flow conversion excl. working capital1 Working capital movement (€m) 78% 88% 96% 79% 89% 86% 500 10% 400 8% 300 6% 200 4% 100 2% 0 0% (100) -2% (200) -4% (300) -6% (400) -8% (500) -10% FY 2018 FY 2019 FY 2020 FY 2021 FY 2022
Slide 72: Growth drivers supporting our medium-term guidance
Growth drivers supporting our medium-term guidance FY 2027 FY 2026 FY 2025 FY 2024 Revenue EBITDA margins Cash flow • Cross sell opportunity / increase • Reduce cost of acquisition through • Margin improvement number of products per truck digital and indirect • M&A costs will reduce • Geographic exp
Slide 73: Updated medium-term financial guidance
Updated medium-term financial guidance Net revenue Adjusted EBITDA % Capex Leverage target • Near term, market • FY23 margin levels • €50m transformational • Committed to return to headwinds expect growth expected to be in-line with programme to complete within leverage target range rates to be arou
Slide 74: New KPIs reported from FY24
New KPIs reported from FY24 Total number No. of products % of subscription Total R&D costs as Customer NPS of active trucks per active truck revenue a % of net revenue • Our ambition is to be • Customer user • Shows success of • Move from • Historically has been in ~1m trucks experience is cross-sel
Slide 75: Summary of our ambitions
Summary of our ambitions Integration and transformation Connect ~1m trucks Reposition Eurowag as the go-to-business for anyone within the trucking ecosystem Move to >60% revenues from subscription and >20% financing Improve customers revenues and empower them to realise efficiencies Enable a reducti
Slide 76: Q&A
Ew EUVROWAG Q&A
Slide 77: Thank you
Thank you, investors@eurowag.com eurowag.com Copyright ©2023 W.A.G payment solutions plc