Mony Group Plc · LSE:MONY
Mony — Moneysupermarket.com Group — H1 2008 Earnings Presentation
35 slides from Mony's earnings presentation, Aug 27, 2008
Slide 1: Moneysupermarket.com Group PLC Interim Results Presentation
STRICTLY PRIVATE & CONFIDENTIAL Moneysupermarket.com Group PLC Interim Results Presentation 27 August 2008
Slide 2: Agenda
Agenda Overview: Gerald Corbett Financial Review: Paul Doughty Business Review: Simon Nixon Questions and Answers: Moneysupermarket.com 2
Slide 3: Overview of 2008 interim results
Overview of 2008 interim results 2008 interim results confirm the strength of the diversified business model Continued, strong Group revenue and profit growth despite challenging trading within the Money vertical – Insurance, Travel and Home Services all continue to deliver strong revenue growth >
Slide 4: Financial Review - Paul Doughty
STRICTLY PRIVATE & CONFIDENTIAL Paul Doughty Chief Financial Officer Financial Review
Slide 5: Pro Forma Profit & Loss Account
Pro Forma Profit & Loss Account H1 08 H1 07 Growth £m £m Revenue 99.4 78.5 27% Internet 95.3 73.5 30% Intermediary 4.1 4.9 (17%) Gross Profit 66.6 52.1 28% Gross Margin 67% 66% Adjusted Administrative Costs (26.2) (16.5) 59% Amortisation of Intangibles (12.6) (12.6) 0% Distribution Costs (11.8)
Slide 6: Diversification Continues…
Diversification Continues… H1 2007 Internet Revenues H1 2008 Internet Revenues Home Services / Other, 34% Home Services / £4.1m Other, £2.3m Travel, Travel, £11.1m 3% 4% £7.5m 10% 12% Money, Insurance, 51% £37.2m Money, 36% £26.4m 42% £40.3m Insurance, 42% £39.7m Source: Company data and audited acc
Slide 7: …and Direct Revenues Maintained
…and Direct Revenues Maintained June 2007 Revenue Share June 2008 Revenue Share Partners Partners 15% 14% Direct (incl. SEM Direct (incl. SEM SEO) 25% SEO) 24% 61% 61% Source: Company data Direct to site revenues continue to be the largest part of the revenue mix Gross margins stable 7
Slide 8: Adjusted Cost Base
Adjusted Cost Base ` H1 2008 H1 2007 £m % of Revenues % of Costs £m % of Revenues % of Costs (1) Adjusted Cost Base Revenues 99.4 78.5 Staff Costs 14.0 14% 38% 10.2 13% 39% Making Money 1.6 1% 3% Depreciation 1.5 2% 4% 0.7 1% 3% Irrecoverable VAT 4.6 5% 12% 3.0 4% 11% Other Admin 4.6 5% 12% 2.5 3% 9
Slide 9: Cash Position and Dividend Policy
Cash Position and Dividend Policy The group continues to generate cash, and operates a strong balance sheet – Cash at 30 June 2008 c.£71m The Group has sufficient cash to meet its anticipated medium term requirements, and therefore has decided to increase the targeted annual dividend payout from
Slide 10: Statutory Balance Sheet
Statutory Balance Sheet June 2008 June 2007 £m £m Intangible assets 306.3 333.8 Other non-current assets 16.2 7.4 Net current assets / (liabilities) 60.2 (138.4) Long term liabilities (50.7) (62.0) Net Assets 332.0 140.7 Capital and Reserves 332.0 140.7 Intangible assets include £125m of goodwill,
Slide 11: Accounting Information
Accounting Information Share Option Charges Pre-IPO 12.5m unapproved options which vest 2008 – 2010 with exercise price of 6p 1.2m SIPs/Chairman awards (0.7m after assumed attrition) which vest 2010 with an exercise price of nil Black Scholes Model used for valuation Post-IPO 0.8m LTIP (afte
Slide 12: Accounting Information (cont’d)
Accounting Information (cont’d) Simon Nixon Scheme from Prospectus SJN to make available up to 4.8% of issued share capital to senior management with scheme to be „cash settled‟ by SJN – No P&L charge anticipated at IPO in accordance with IFRS2 IFRIC 11 issued in 2008 changes accounting treatmen
Slide 13: Accounting Information (cont’d)
Accounting Information (cont’d) Tax Effective rate of 32.2% on H1 2008 statutory profit – Higher than statutory tax rate of 28% due to: – 3 months‟ profits taxed at 30% – Trapped losses in German business for which a deferred tax credit is not recognised – Unwinding of deferred tax asset in relati
Slide 14: Financial Highlights
Financial Highlights Revenues continued to grow in H1 2008, increasing 27% from £78.5m to £99.4m – Internet revenue up 30% on H1 2007 and represented 96% of turnover Continued diversification across the internet business – Insure and Travel verticals continue to expand rapidly – Insure and Money
Slide 15: Business Review - Simon Nixon
STRICTLY PRIVATE & CONFIDENTIAL Simon Nixon Chief Executive Officer Business Review
Slide 16: Half Year Highlights
Half Year Highlights Internet business highlights Momentum continued in H1 2008 despite challenging markets – 39% increase in Internet Visitors (a) – 37% increase in Internet Transactions – 30% increase in Internet Revenues Growth across all verticals – Strong growth in Insurance, Travel and Hom
Slide 17: Leading Online Position
Leading Online Position #1 Finance price comparison website #1 Travel price comparison website Leading market position maintained But a highly competitive environment, particularly for Insurance New entrants achieving market share through significant TV advertising expenditure Price Comp
Slide 18: The competitive position in insurance
The competitive position in insurance Advertising expenditure in 2008: Q1 2008 Q2 2008 Q3 2008 (a) Moneysupermarket.com £4.2m £2.9m £4.2 - 4.9m GoCompare £4.9m £5.1m £6.2m Confused.com £4m £4m £6.1m (Source: Nielsen data to July, estimates for Q3) (a) Excludes advertising spend by the Group on Tra
Slide 19: Half Year Highlights – Money
Half Year Highlights – Money Revenues grew by 8% to £40.3m, representing 42% of Internet revenues Strong Visitor growth 27% demonstrating continued demand for price comparison services in tougher economic climate Click-based revenues of £33.4m grew by 15% – Revenues in the loans and mortgages
Slide 20: Half Year Highlights – Insurance
Half Year Highlights – Insurance Revenues grew by 50% to £39.7m, representing 42% of Internet revenues Click based revenue increased by 59% to £35.0m – Improved commercials – Improved search functionality and improvements to provider sites increase conversion – 31% improvement in RPT Non click
Slide 21: Half Year Highlights – Travel
Half Year Highlights – Travel Revenues grew by 48% to £11.1m , representing 12% of Internet revenues Margins widening Click-based revenue growth up 49% – Driven by visitor growth of 54% RPV has remained broadly consistent with prior year Graham Donoghue arrived as MD Travel (was e-commerce
Slide 22: Half Year Highlights – Home Services
Half Year Highlights – Home Services Revenues increased by 78% to £4.1m, now representing 4% of internet revenues Revenues have grown across all channels in the vertical against H1 2007 Utilities fastest growing channel – Utilities commands the largest transaction values in the vertical – RPV
Slide 23: Focus on the customer experience H1 2008
Focus on the customer experience H1 2008 Number of changes to improve the customer experience across the site: – Important for brand – Long term view Banner advertising space reduced across the site – Less „cluttered‟, with more focus on results tables and content Customer promise: – Addresses
Slide 24: Focus on the customer experience H1 2008 (cont’d)
Focus on the customer experience H1 2008 (cont’d) Increased “Decision Support” improving conversion rates – Customer reviews launched in Insurance to be extended to Money Product Performance Goals – Key indicators of fitness for purpose – Five key measures • Usability • Searches • Results • Deci
Slide 25: CRM
CRM Revenues increased 73% in H1 2008 over H1 2007 – Improved targeting of campaigns – Average of 35 campaigns per week Mymoneysupermarket launched in October 2007 – 1.9 million customer accounts to date Single view data warehouse technology solution live in Q3 – Brings together 100 million cu
Slide 26: Update From Trading Statements
Update From Trading Statements First Plus Group announced on 9 July that the cessation of trading by First Plus in early August would reduce full year revenues by c.£7m and EBITDA by up to £5m Highlighted 2 mitigating actions – Replace capacity – Initial signs are positive with advanced discussi
Slide 27: Summary
Summary Our diversified approach is showing its strength… And we are continuing to diversify Internationally: Germany, and beyond With new channel launches: Shopping In new ideas: Making Millionaires Continued investment In CRM, SEM improvements (Efficient Frontier), marketing and brand buil
Slide 28: Outlook
Outlook Q3 to date mixed performance against strong comparator period particularly for Money Money – Loans and Mortgages markets remain difficult – Withdrawal of First Plus – Advanced discussions to replace some capacity – Other channels made positive start – Double digit decline relative to sam
Slide 29: Outlook (Cont’d)
Outlook (Cont’d) Travel – Slower rates of growth vs. Q2 – Reduction in TV Advertising expenditure – Improved profitability Home Services – Very strong growth rates Q3 to date – Utilities primary driver 2nd half overall – Solid growth, but slower than H1 – Absolute level of profitability will b
Slide 30: Questions and Answers
STRICTLY PRIVATE & CONFIDENTIAL Questions and Answers
Slide 31: Appendix
STRICTLY PRIVATE & CONFIDENTIAL Appendix
Slide 32: Pro Forma Profit & Loss Account
Pro Forma Profit & Loss Account MSFG acquired by Moneysupermarket.com Group (“MSM”) on 22 June 2007 Pro forma results prepared showing what the financial results would have been had MSM acquired MSFG on 1 January 2006 on a debt free basis Adjusted EBITDA adds back: – Elements of Directors‟ and
Slide 33: Adjusted EBITDA
Adjusted EBITDA H1 H1 H1 H2 FY 2008 2007 Var. Var.% 2008 2007 Var. Var.% 2007 Revenues Internet 95.3 73.6 21.7 29% 95.3 78.6 16.7 21% 152.2 Intermediary 4.1 4.9 (0.8) (16)% 4.1 5.8 (1.7) (29)% 10.7 Total 99.4 78.5 20.9 63% 99.4 84.4 15.0 18% 162.9 Gross Profit 66.6 52.1 14.5 28% 66.6 56.5 10.1 18% 1
Slide 34: KPIs – Verticals
KPIs – Verticals H1 H1 H2 FY 2008 2007 2007 2007 Money Visitors (m) 17.7 14.0 13.7 27.7 Transactions (m) 7.9 6.1 6.5 12.6 Revenue (£m) - Click-based 33.4 28.9 31.9 60.8 Revenue (£m) - Other 6.9 8.3 7.8 16.1 Revenue (£m) - Total 40.3 37.2 39.7 76.9 RPV £2.28 £2.67 £2.89 £2.82 RPT £4.22 £4.74 £4.90 £4
Slide 35: KPIs - Internet
KPIs - Internet H1 2008 H1 2007 Growth Group Visitors ('m) 62 45 39% Transactions ('m) 40 29 37% Click Revenue (£m) 82 60 38% Other Revenue (£m) 13 14 (5%) Total Revenue (£m) 95 74 30% RPV £1.54 £1.65 (7%) RPT £2.07 £2.06 1% 35
Moneysupermarket.com Group — H1 2008 Earnings Presentation on 6ix