Porch Group, Inc. · NASDAQ:PRCH
Porch — Q2 2021 Earnings Presentation
30 slides from Porch's earnings presentation, Aug 16, 2021
Slide 1: Q2 2021 Earnings Presentation
Love your home. For moving and improving and everything in between. Group Q2 2021 Earnings Presentation August 16, 2021 Copyright 2021 Porch Group, Inc. All rights reserved 1
Slide 2: Presenters
Presenters Matt Ehrlichman Marty Heimbigner CEO & Founder, Porch Group CFO, Porch Group Matthew Neagle Adam Kornick COO, Porch Group President, InsurTech Division Copyright 2021 Porch Group, Inc. All rights reserved
Slide 3: Disclaimers
DISCLAIMERS Forward-Looking Statements Certain statements in this presentation may be considered “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to futur
Slide 4: Q2 2021 Earnings Call Kick-off
Q2 2021 Earnings Call Kick-off Group Copyright 2021 Porch Group, Inc. All rights reserved 4
Slide 5: Porch, the Vertical Software Platform for the Home
Porch, the Vertical Software Platform for the Home Software & Services for Companies Porch has a unique strategy in the home services industry. 1. Porch provides software & services to home inspectors, movers, title and roofing companies and helps them to grow. 2. Through these companies, Porch gain
Slide 6: Key Focus Areas for 2021
6 Key Focus Areas for 2021 1. Increase number of companies using our vertical software 2. Increase access to consumers from software companies 3. Increase B2B2C transaction revenue per consumer 4. Continue to scale our InsurTech business 5. Help brands and advertisers improve their mover marketing 6
Slide 7: Q2 2021 Results & 2021E Guidance
Q2 2021 Results & 2021E Guidance Group Copyright 2021 Porch Group, Inc. All rights reserved 7
Slide 8: Strong Year-over-Year Revenue Performance of ~235% Growth
Strong Year-over-Year Revenue Performance of ~235% Growth Q2 2021 Revenue vs Q2 2020PF Revenue $1.3M-Rynoh Q2 acquisition $34.6M-Higher revenue $51.3M $15.4M Q2 2020 PF Q2 2021 Actuals YoY ~235% increase Higher PF stands for Pro Forma to account for the removal of financial results related Revenue t
Slide 9: Q2 2021 Actuals vs Q2 2021 Guidance
Q2 2021 Actuals vs Q2 2021 Guidance Q2 2021 Actuals vs Q2 2021 Guidance $6.3M $51.3M 14% “North of $45M” 62% Not provided quarterly In line with internal 33% expectations Not provided quarterly -20% Not provided quarterly See Appendix for a reconciliation of Revenue Less Cost of Revenue %, Adjusted
Slide 10: Raising FY 2021E Revenue Guidance and Reiterating Margin Guidance
Raising FY 2021E Revenue Guidance and Reiterating Margin Guidance Previous 2021E Guidance Guidance ▲ Current 2021E Guidance $178M ~$184M (155% YOY Growth) ~72% No Change ~72% No Change ~40% ~40% Tightening the range -10% to -16% (making investments) -13% to -16% Disclaimer: Porch is not providing r
Slide 11: 2021E Revenue: 155% YoY Growth with ~90% Recurring or Reoccurring
2021E Revenue: 155% YoY Growth with ~90% Recurring or Reoccurring Revenue FY 2021E Guidance Revenue Distribution $184M $54M (2) 10% HOA V12 25% Rynoh (1) $85M 65% $72M $57M $36M (3) Software & Services Subscriptions B2B Recurring Fees From Companies (4) Move-Related Transactions 2018PF 2019PF 2020A
Slide 12: 2021E Contribution Margin % and Adjusted EBITDA % Continued Growth
2021E Contribution Margin % and Adjusted EBITDA % Continued Growth Contribution Margin % Adjusted EBITDA % 50% 25% ~40% 34% -13% to -16% -24% 19% -57% 7% -79% 2018PF 2019PF 2020PF 2021E Long-Term 2018PF 2019PF 2020PF 2021E Long-Term Target Target Note: PF figures are Pro Forma results which exclude
Slide 13: KPIs – Number of Companies & Average Revenue Per Company
KPIs – Number of Companies & Average Revenue Per Company (1) (2) Q1 Q2 Q3 Q4 17,120 companies in Q2 2021 $1,000 revenue per company in Q2 2021 (1) Porch management defines average companies in a quarter as an average of the end of period number of companies with the beginning of period number, inclu
Slide 14: KPIs – Monetized Services for Consumers
KPIs – Monetized Services for Consumers (1) (2) Q1 Q2 Q3 Q4 302,462 monetized services in Q2 2021 $129 revenue per monetized service in Q2 2021 (1) Monetized Services per Quarter is defined as the total number of unique consumer services from which Porch generated revenue, including, but not limited
Slide 15: Deep Dives
Deep Dives Group Copyright 2021 Porch Group, Inc. All rights reserved 15
Slide 16: InsurTech Update
InsurTech Update Gross Written Premium – 2021E Guidance HOA State Expansion Plan Active States $300M (from $275M) Regulators Approved (launching soon) Target States (2021-2022) Ceding vs Retaining Premium Gross Loss Ratios – 2020 Results ~90% Premium Ceded to 3rd party reinsurers 59% Premium Held by
Slide 17: Welcome Rynoh! A leading SaaS provider for title companies
Welcome Rynoh! A leading SaaS provider for title companies Vertical Software Expansion Copyright 2021 Porch Group, Inc. All rights reserved 17
Slide 18: Rynoh Deal Summary and Business Overview
Rynoh Deal Summary and Business Overview Business Overview Strategic Opportunities • SaaS application used by title companies (and • Opportunity to introduce Porch services such as other settlement agents) to protect the residential insurance to homebuyers via the real estate closing real estate tra
Slide 19: Porch Group Investment Highlights
Porch Group Investment Highlights 1 1. Vertical software leader to key home service companies with low churn and high NPS 2 2. Large and ideal consumer audience provided via software companies, with low acquisition costs 3 3. Unique, substantial, and valuable property data which no one else has 4 4.
Slide 20: Thank you
Group Thank you Copyright 2021 Porch Group, Inc. All rights reserved 20
Slide 21: Q&A
Q&A Group Copyright 2021 Porch Group, Inc. All rights reserved 21
Slide 22: Appendix
Appendix Group Copyright 2021 Porch Group, Inc. All rights reserved 22
Slide 23: Cash position is strong
Cash position is strong Balance Sheet Cash and Restricted Cash as of June 30, 2021: $152.4M • Primary use of cash expected for M&A • Well positioned to support investments; vertical software systems, Insurtech, data platform & consumer experience Total Long-Term Debt as of June 30, 2021: $43.8M Copy
Slide 24: Capital Structure Update
Capital Structure Update Capital Structure • Total common shares outstanding as of June 30, 2021: 96.3M and 3.1M warrants outstanding • In addition to the above, when team RSUs vest or team options both vest and are exercised, it will be added to total shares outstanding above. This relates to pre-S
Slide 25: QTD Net Income to Adj EBITDA non-GAAP Reconciliation
QTD Net Income to Adj EBITDA non-GAAP Reconciliation Q2 2021 Q2 2020 Net income (loss) $ (16.3M) $ (6.3M) (1) Interest expense 1.2M 3.3M Income tax (benefit) expense (7.7M) 0.0M Depreciation and amortization 3.9M 0.1M (2) (8.5M) Other expense, net (2.0M) Non-cash bonus expense 0.4M — Non-cash long-l
Slide 26: QTD Revenue to Contribution Margin non-GAAP Reconciliation
QTD Revenue to Contribution Margin non-GAAP Reconciliation Q2 2021 Q2 2020 Revenue $ 51.3M $ 17.1M Cost of Revenue 19.5M 3.8M Revenue - Cost of Revenue 31.8M 13.3M Variable Selling & Marketing and Advertising 15.0M 7.3M (1) Contribution Margin $ 16.8M $ 6.0M Contribution Margin % of Revenue 33% 35%
Slide 27: YTD Net Income to Adj EBITDA non-GAAP Reconciliation
YTD Net Income to Adj EBITDA non-GAAP Reconciliation 6 months 2021 6 months 2020 Net income (loss) $ (81.4M) $ (24.6M) (1) Interest expense 2.4M 6.3M Income tax (benefit) expense (8.1M) 0.0M Depreciation and amortization 6.3M 1.9M (2) (8.5M) Other expense, net (0.1M) Non-cash bonus expense 0.7M — No
Slide 28: YTD Revenue to Contribution Margin non-GAAP Reconciliation
YTD Revenue to Contribution Margin non-GAAP Reconciliation 6 months 2021 6 months 2020 Revenue $ 78.1M $ 32.1M Cost of Revenue 25.4M 7.9M Revenue - Cost of Revenue 52.7M 24.2M Variable Selling & Marketing and Advertising 24.7M 17.8M (1) Contribution Margin $ 27.9M $ 6.4M Contribution Margin % of Rev
Slide 29: Porch Has The Potential to Grow Revenues ~20x
(1) Porch Has The Potential to Grow Revenues ~20x 1 $1600 ~$200M ~$1.5B Insurance Expansion: ~$400M potential revenue opportunity $1400 3 ~$400M • Expand from an insurance agency to a Managing General Agent (MGA) / carrier. $1200 2 $1000 ~$400M 2 $800 New Vertical Expansion: ~$400M potential revenue
Slide 30: The Home is one of the largest market opportunities
The Home is one of the largest market opportunities Porch has a U.S. Total Addressable Market of ~$320B Moving Services: ~$4B(1) Moving (moving, security, TV/internet) Services Mover Marketing: ~$8B(4) Mover Marketing Contractor Services: ~$141B(3) Contractor (referral, managed services gross profit