Corporate Travel Management Limited · ASX:CTD
Corporate Travel Management — H1 FY2019 Earnings Presentation
33 slides from Corporate Travel Management's earnings presentation, Feb 20, 2019
Slide 1: 2019 Half Year Results
Date: 20/02/2019 Presenter Name: Jamie Pherous, Managing Director 2019 Half Year Results.
Slide 2: Disclaimer
Disclaimer. The information in this presentation does not constitute personal investment advice. The presentation is not intended to be comprehensive or provide all information required by investors to make an informed decision on any investment in Corporate Travel Management Limited ACN 131 207 611
Slide 3: Overview
Overview. CTM is an award-winning provider of innovative and cost effective travel management solutions to the corporate market. Its proven business strategy combines personalised service excellence with client facing technology solutions, to deliver a return on investment to clients. Headquartered
Slide 4: Group Financial Highlights
Group Financial Highlights.
Slide 5: Group results highlights
Group results highlights. Change on Reported ($AUDm) 1HFY19 P.C.P • Underlying EBITDA up approximately 21% to $64.6m TTV (unaudited) 2,951.5 +31% (includes $1.3m FX upside to forecasted FX assumptions) • Strong organic growth and specifically, record client wins Revenue and other income 212.2 +23% u
Slide 6: Growth Profile
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Slide 7: Statutory EPS growth - successful M&A with organic growth
Statutory EPS growth - successful M&A with organic growth. ? Typical seasonal EBITDA split 71.4 1H 40% - 43% 2H 57% - 60% 52.5 42.8 42.8 30.6 27.9 25.1 18.8 14.9 17.4 36.0 11.6 28.6 8.2 21.9 17.7 10.5 6.7 7.2 2013 2014 2015 2016 2017 2018 2019 1H 2H Page 7
Slide 8: A quality business – out performing in every region
A quality business – out performing in every region. Page 8
Slide 9: Regional Performance
Regional Performance.
Slide 10: Underlying 1HFY19 EBITDA Growth Summary (AUD$m)
Underlying 1HFY19 EBITDA Growth Summary (AUD$m). • Organic growth again the catalyst for performance, representing approx. +18% on 1HFY19 baseline • Previously flagged overheads would grow at a slower rate than revenue as CTM built out a global support structure Page 10 *M&A EBITDA values represent
Slide 11: 1HFY19 Regional overview
1HFY19 Regional overview. Australia & New CTM Consolidated Zealand North America Asia Europe Group Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17 Dec-18 Dec-17 REPORTED (AUD) $m $m $m $m $m $m $m $m $m $m $m $m TTV 2,951.5 2,258.5 31% 649.6 541.2 20% 689.9 592.4 16% 1,070.5 66
Slide 12: ANZ
ANZ. % Underlying EBITDA up 18% on the p.c.p.: 1H19 1H18 Change • Region continues to outperform market Reported (AUD) $m • Winning market share through record new client wins and TTV 649.6 541.2 20% retention Revenue 58.3 50.5 15% • 1H result includes $0.4m EBITDA contribution from SCT acquisition
Slide 13: Asia
Asia. % Underlying EBITDA 34% on the p.c.p.: 1H19 1H18 Change • Business performing well across all segments Reported (AUD) $m • CTM technology gaining good traction, resulting in client wins and TTV 1,070.5 667.9 60% improved sales pipelines Revenue 38.3 26.1 47% • Lotus Travel integration going we
Slide 14: North America
North America. % Underlying EBITDA up 3% on the p.c.p.: 1H19 1H18 Change • As previously flagged, strong revenue growth off-set by additional $2.0m technology hub development costs expensed Reported (AUD) $m in 1H versus the p.c.p. This explains the lower EBITDA margin TTV 689.9 592.4 16% • On a ‘li
Slide 15: The opportunity - USA and Asia via CTM Technology
The opportunity - USA and Asia via CTM Technology. 1. CTM has demonstrated a sound track record with proprietary technology: • The ANZ and Europe experience is compelling - an enhanced proprietary technology proposition improves client win and retention rates, improves productivity, and allows staff
Slide 16: Europe
Europe. % Underlying EBITDA up 30% on the p.c.p.: 1H19 1H18 Change • Region continues to outperform market Reported (AUD) $m TTV 541.5 457.0 18% • Continuation of winning market share despite patchy client activity (Brexit) Revenue 43.3 35.9 21% • Additional benefit from global clients won ex USA, t
Slide 17: Group Financial Summary
Group Financial Summary.
Slide 18: Comparative statutory profit and loss
Comparative statutory profit and loss. % $AUD (m) 1H19 1H18 • $2.8m of amortisation relates to client intangibles as Change part of acquisition accounting, which is a non-cash amount TTV 2,951.5 2,258.5 +31% Revenue and other income 212.2 172.8 +23% • Amortisation of client intangibles for full year
Slide 19: Comparative statutory balance sheet
Comparative statutory balance sheet. $AUD (m) Dec 2018 June 2018 Cash 74.2 84.3 Receivables and other 267.8 256.4 • Intangibles have increased primarily due to Lotus Total current assets 342.0 340.7 acquisition PP&E 7.8 6.1 • Typically receivables and payables are lower at 31 Intangibles 502.0 451.6
Slide 20: Operating cash conversion - rolling year average
Operating cash conversion - rolling 7 year average. • Operating cash conversion rolling 7 year Operating cash conversion % at half yearly reporting dates average near 100% 180% 160% • Half year swings primarily due to the fixed timing cycles of supplier payments (fixed dates set by 140% BSP¹ and RSP
Slide 21: Why year end (30 June 2019) will show strong cash conversion
Why year end (30 June 2019) will show strong cash conversion. # Cash Balance Swings ($m) Timing Differences Explained • As illustrated, the bottom of the cash cycle represents the fixed payment date for air and rail, the top of the cash cycle is immediately before payment is due, when cash is at its
Slide 22: Cash flow summary
Cash flow summary. $AUD (m) 6mth FY19 6mth FY18 EBITDA 63.2 53.0 • Change in working capital primarily due to timing cycle of fixed supplier payments. Operating cash conversion Non cash items 1.5 (0.6) of $28.2m (45% conversion) for 1H19 Change in working capital (36.5) 13.4 Income tax paid (13.1) (
Slide 23: Client Innovation
Client Innovation.
Slide 24: Future proofing technology – controlling our destiny
Future proofing technology – controlling our destiny. What is CTM SMART technology? 2. Competitive Advantage - in-house Development, in-region • CTM developed, integrated end-to- end solution for clients, including: • Speed to market frequent releases • SMART portal, diagnostic widgets, p.a., across
Slide 25: Technology hubs located in all global regions
Technology hubs located in all global regions. Region Tech hub location ANZ Sydney, Australia EUROPE Hale, United Kingdom USA Los Angeles, USA ASIA Hong Kong Goal : To accelerate speed to market and tailor client development, in-region Page 25
Slide 26: Acquisition
Acquisition.
Slide 27: Acquisition update
Acquisition update. Lotus Travel (Greater China) - recap • Acquisition completed 2 October 2018, and will contribute 9 months to group EBITDA • As previously flagged, Lotus is expected to contribute approximately AUD4.0m for FY19 Highlights: • Executed combined organisational structure, reporting li
Slide 28: FY19 Strategy and Guidance
FY19 Strategy and Guidance. Insert Heading Here Insert Heading Here
Slide 29: Key strategic initiatives FY19-21
Key strategic initiatives FY19-21. Continued Organic Client Facing Productivity & Leverage Our Scale & Our People Growth & Acquisition Innovation Internal Innovation Geography 1. Enhance our value 1. Continuous 1. Internal innovation 1. Demonstrating CTM 1. Empower our teams to proposition to client
Slide 30: FY19 Guidance update
FY19 Guidance update. CTM is tracking at the top end of FY19 Guidance (underlying EBITDA AUD$150m, +20%) FY19 underlying EBITDA range of AUD$144-150m (approximately +15%-20% growth on the p.c.p.) was provided with the release of the FY18 results in August 2018 Guidance Assumptions: 1. Foreign Curren
Slide 31: Appendix A - AASB15 - Impact on revenue recognition disclosure
Appendix A - AASB15 - Impact on revenue recognition disclosure
Slide 32: AASB15 Revenue from contracts with customers – Impact
AASB15 Revenue from contracts with customers – Impact. • CTM has adopted AASB15 from 1 July 2018. • There is no financial impact on revenue recognition policy for the Group profit and loss versus the p.c.p.. • Revenue previously disclosed has been disaggregated as follows; • Transactional revenues b
Slide 33: travelctm.com
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