Car Group Limited · ASX:CAR
Car — H1 FY2024 Earnings Presentation
42 slides from Car's earnings presentation, Feb 12, 2024
Slide 1: Half Year Results Presentation
Half Year Results Presentation Half year ended 31 December 2023
Slide 2: Disclaimer and Non-IFRS Information
Disclaimer and Non-IFRS Information Disclaimer Non-IFRS Financial Information The material in this presentation has been preparation of such statements, actual CAR Group results are reported under prepared by CAR Group Limited (ASX: CAR) results may vary in a material manner. International Financial
Slide 3: Agenda
Agenda 1 2 3 4 5 H1 FY24 Financial Operating Strategy Appendix Highlights Performance Segments Update Review 4 - 17 18 - 23 24 - 30 31 - 36 37 - 42 3
Slide 4: H1 FY24 Highlights
= (> CAR Group 1. H1 FY24 Highlights
Slide 5: Excellent First Half Performance
Excellent First Half Performance • Double-digit revenue and earnings growth in all markets. • Delivered good growth in Korea and Australia whilst creating substantial value through Brazil and US acquisitions. • Strong operational execution and continued investment in long-term growth initiatives. Pr
Slide 6: Operational Highlights
Operational Highlights Excellent operational metrics reflect strength of our global marketplaces 2.4 million 48 thousand 9 billion Vehicles online1 Subscribed dealers2 Page views3 602 million 230 thousand 12x more preferred carsales.com.au v Total sessions4 Encar car inspections5 nearest competitor6
Slide 7: New CAR Group Brand Reflecting Our Growth
New CAR Group Brand Reflecting Our Growth Transformative growth and diversification across markets and segments Revenue Contribution Australia North America Latin America Asia Investments 2% 6% 10% 11% 16% 16% 42% 72% 25% carsales.com Ltd in FY19 CAR Group Today1 7 (1) CAR Group Today = revenue from
Slide 8: CAR Group Strategy
CAR Group Strategy Our Purpose To make buying and selling a great experience Our Vision To create #1 digital marketplaces for vehicles around the world Our Focus areas Building seamless Investing in new digital experiences growth opportunities Our Drivers People Sustainable Growth Investing in attra
Slide 9: Delivering Excellent Returns For Shareholders
Delivering Excellent Returns For Shareholders Adjusted Earnings per Share (cents)1 20% CAGR 86.3 7% CAGR 70.7 59.7 57.6 49.5 51.1 CY18 CY19 CY20 CY21 CY22 CY23 (1) In accordance with AASB 133, historical EPS has been restated based on an adjustment factor to take into account the New Shares issued i
Slide 10: Market Opportunity
Market Opportunity We operate in large, attractive markets with significant opportunity for future long-term growth Total Addressable Market (TAM): $15.4 billion1 Market Share (revenue / TAM) Market Share $2.5 billion $2.0 billion 1 $8.4 billion 7% 3% $2.6 billion FY15 CY23 10 Refer to slide 42 for
Slide 11: Our Global Priorities
Our Global Priorities We have a clear set of priorities across our global marketplaces Market Leadership 1. 2 1. Market 2. Digital .D s 3. Depth on Leadership Retailing igi riz tal 6. Future Ho Expand the Increase digitisation Reta Deliver value for leadership positions of the vehicle sellers throug
Slide 12: Key Highlights
Key Highlights We have executed on our global priorities in H1 FY24 Market Leadership Digital Retailing Maintained significant market leadership1 Encar Home transactions have increased across the Group demonstrating a rise in consumer demand for 100% online transactions 7.2x 3.0x Over #2 #2 26 thous
Slide 13: Key Highlights
Key Highlights We have executed on our global priorities in H1 FY24 Depth Media Expansion Depth products are delivering outstanding value for Leveraging new technology and IP effectively dealers through reduced time to sell and/or higher across the Group, resulting in improved ad margins viewability
Slide 14: Key Highlights
Key Highlights We have executed on our global priorities in H1 FY24 Private Future Horizons Delivered higher private ad yield in Australia Launched new Successfully deployed phase 1 of Australian marine brand in the dynamic pricing into TI and webmotors with further US upside to come Recently launch
Slide 15: Multiple Marketplace Growth Drivers
Multiple Marketplace Growth Drivers Australia International Korea US Latin America Dealer Private Media Auto Auto Non-Auto New Volume customers Dealer Auto Premium ad penetration Traditional Growth Drivers Yield diversification penetration Yield Product Native ads Yield Product Depth expansion expan
Slide 16: Compelling Double-Digit Growth Over 16 Years Through Different Economic Cycles
Compelling Double-Digit Growth Over 16 Years Through Different Group Proforma Financial Performance (AUDm) Economic Cycles Revenue EBITDA Revenue Highly resilient and CAGR: 15% countercyclical business model • CAR Group is more geared to used vehicle buy & sell transactions which have less cyclicali
Slide 17: FY24 Outlook
FY24 Outlook Outlook statement Proforma Basis We expect to deliver good growth in Revenue and EBITDA in FY24. Actual Basis We expect to deliver very strong growth in Revenue and Adjusted EBITDA and strong growth in Adjusted NPAT in FY24. Margin We expect to see expansion in the CAR Group EBITDA marg
Slide 18: Financial Performance
2. Financial Performance 18
Slide 19: Track Record of Growth
Track Record of Growth Proforma Proforma Revenue1 EBITDA1 13% CAGR ($m) ($m) 14% CAGR 531 459 277 401 238 330 338 194 209 163 H1 FY20 H1 FY21 H1 FY22 H1 FY23 H1 FY24 H1 FY20 H1 FY21 H1 FY22 H1 FY23 H1 FY24 Adjusted Adjusted NPAT EPS2 ($m) 27% CAGR (cents) 15% CAGR 163 43.2 122 34.6 28.5 29.8 24.6 63
Slide 20: P&L Summary
P&L Summary • Very strong increase in revenue and EBITDA reflects double- $A Millions H1 FY23 H1 FY24 Growth % digit underlying growth and the consolidation of Trader Revenue 331.7 530.7 60% Interactive and webmotors. Operating expense 1 (153.9) (253.6) (65%) • D&A largely reflects depreciation of b
Slide 21: Segment Performance
Segment Performance Delivering double-digit revenue and earnings growth in all key segments $A Millions H1 FY23 H1 FY24 Growth % CC %1 • Australia – Continuing to strengthen our value proposition for Australia 2 189.1 213.8 13% 13% customers, providing the largest audience and widest choice North Am
Slide 22: EBITDA Margin Summary
EBITDA Margin Summary Group margins continue to expand while investing in key growth initiatives Australia - Continued benefits of operating leverage while investing in key future growth drivers including Instant Offer, site simplification, digital retailing and C2C payments. North America – Achieve
Slide 23: Strong Cash Flow and Robust Balance Sheet
Strong Cash Flow and Robust Balance Sheet Cash flow conversion Leverage2 and net debt Capex • 98% EBITDA to cash conversion • Further reduction in leverage ratio • Capex investment continues to reflects the attractive working on a proforma2 basis, remains support revenue growth. Key capital profile
Slide 24: Operating Segments Review
3. Operating Segments Review 24
Slide 25: Australian Market Observations
Australian Market Observations The new car market is strong coupled with continuing strength and resilience in the used car market VFACTS1 new vehicle sales New car listings2 New vehicle sales have increased New car inventory is returning to market with listings at pre-covid-19 levels (‘000) +25% (‘
Slide 26: Australia - carsales
Australia - carsales Revenue Resilient used car market and strong 213.8m 13% operational execution Adjusted EBITDA • Double-digit growth in Dealer, Private and Media segments. 137.3m 13% Continued strength in market leadership and brand health metrics. • Dealer result driven by increasing lead volum
Slide 27: North America - Trader Interactive
North America - Trader Interactive Excellent progress on strategic initiatives USDm • Delivered double-digit revenue growth across all verticals. Proforma Revenue 89.2m 15% • Multiple growth drivers including new customer additions, new products, media expansion, dynamic pricing, yield uplifts and i
Slide 28: Latin America - webmotors
Latin America - webmotors Outstanding financial performance with strategic BRLm initiatives delivering significant growth Proforma Revenue 268.6m 28% • Outstanding growth reflecting an extension of our market leading position. Proforma EBITDA 101.2m 32% • National expansion plan is driving strong gr
Slide 29: Asia - Encar
Asia - Encar KRWb Growing penetration of premium products Revenue 49.0m 13% • Good growth in revenue and EBITDA driven by audience engagement, high inventory count, increasing premium product penetration and yield increases. Adjusted EBITDA 22.8m 11% • Guarantee inspection product now at 48% of all
Slide 30: Latin America & Investments
Latin America & Investments Latin America Other (excl. Brazil) CCm Latin America Other (excluding Brazil) • Good revenue growth in Chile through the implementation of Revenue the lead model. 3.8m 15% • In the process of exiting our Mexican business given the market remains challenging and our focus
Slide 31: Strategy Update
= >) CAR Group 4. Strategy Update
Slide 32: Our Global Priorities
Our Global Priorities We have a clear set of priorities across our global marketplaces Market Leadership 1. 2 1. Market 2. Digital .D s 3. Depth on Leadership Retailing igi riz tal 6. Future Ho Expand the Increase digitisation Reta Deliver value for leadership positions of the vehicle sellers throug
Slide 33: Digital Retailing
Digital Retailing Digital finance transactions in Brazil are a huge opportunity The Brazilian macro We have simplified the loan Resulting in improved operating environment is improving application process metrics • Improved user interface. webmotors auto finance Lower inflation and declining interes
Slide 34: Media Expansion
Media Expansion Our global media business is accelerating through strong execution of strategy We operate in large and We have a clear strategy to And an opportunity to deliver underpenetrated addressable expand our media footprint further revenue growth markets CAR Group Media Revenue1 Grow direct
Slide 35: Future Horizon - Marine
Future Horizon - Marine We are expanding our marine footprint in the US The marine TAM is one of the We are investing in dealer and We launched our new brand and largest in the TI portfolio inventory acquisition will increase market share $1.0 billion • Signed over 1,000 dealers Total addressable ma
Slide 36: Compelling Investment Proposition
Compelling Investment Proposition CAR Group presents a highly compelling investment proposition with multiple growth opportunities across large addressable markets Clear leadership Digitising Underpenetrated Transferrable, Strong cash positions in each vehicle international scaled IP and flows with
Slide 37: Appendix
= >) CAR Group 5. Appendix 37
Slide 38: Overview of CAR Group Non-IFRS Financial Information
Overview of CAR Group Non-IFRS Financial Information What is IFRS and non-IFRS financial from financial information prepared in clearly reconcile between the IFRS and non- information? accordance with all relevant accounting IFRS financial information. standards and has been subject to either • IFRS
Slide 39: Segment Details
Segment Details Proforma Basis Adjusted Basis 1 1 $A Millions H1 FY23 H1 FY24 Growth % CC % H1 FY23 H1 FY24 Growth % CC % Dealer 94.6 106.3 12% 12% 94.6 106.3 12% 12% Private 43.9 48.7 11% 11% 43.9 48.7 11% 11% Media 28.3 34.5 22% 22% 28.3 34.5 22% 22% Online Advertising 166.9 189.5 14% 14% 166.9 18
Slide 40: Reconciliation of Adjusted to Reported Financials
Reconciliation of Adjusted to Reported Financials $A Millions H1 FY23 H1 FY24 A. M&A and other significant items include Korea IPO process, closure of Mexico, and webmotors transaction costs. Adjusted EBITDA 177.9 277.2 Restructuring, M&A and FX items (13.0) (7.7) A B. Gain on step acquisition refle
Slide 41: Exchange Rates
Exchange Rates H1 FY24 FX FX rates, rates,half fullyear yearended endedDecember June Average Average Closing Closing AUD / USD 0.65 0.68 AUD / KRW 859.13 881.06 AUD / BRL 3.21 3.30 AUD / CLP 569.91 597.89 For the presentation, constant currency growth rates have been derived by applying H1 FY24 aver
Slide 42: Total Addressable Markets
Total Addressable Markets Volume Yield TAM Country Segment (m) (AUD) (AUDm) B2C 2.0 250 500 Digital retailing 0.2 700 110 Dealer Digital trade-in 0.5 500 225 Finance 0.1 490 50 Non-auto - - 200 Private 1.8 100 175 Media - - 800 Data & Services - - 500 Australia Total 2,560 RV 0.8 667 500 Powersports