Moonpig Group Plc · LSE:MOON
Moonpig — FY2024 Earnings Presentation
36 slides from Moonpig's earnings presentation, Jun 27, 2024
Slide 1: Full Year Results Presentation
Full Year Results Presentation Year ended 30 April 2024 27 June 2024 Strictly Private and Confidential
Slide 2: Disclaimer
Disclaimer This presentation and the discussion which follows it may include certain forward-looking statements with respect to the business, strategy and plans of the Company (together with its subsidiaries, the “Group”) and its current goals and expectations relating to its future financial condit
Slide 3: Agenda
Agenda 1 Overview – Nickyl Raithatha 2 Financial performance – Andy MacKinnon 3 Strategic update – Nickyl Raithatha 3
Slide 4: Revenue and profit growth underpinned by technology
Revenue and profit growth underpinned by technology Performance accelerated Delivering on Renewed confidence through the year our strategy in our outlook • Step up in revenue growth in H2 at • Over 500k active subscribers of • Expected mid to high single digit both Moonpig and Greetz Moonpig Plus. p
Slide 5: Financial performance
5 Financial performance Andy MacKinnon Chief Financial Officer
Slide 6: Year-on-year growth in revenue and profit, with strong cash generation
Financial performance Year-on-year growth in revenue and profit, with strong cash generation Year-on-year Adjusted EBITDA Adjusted Continued revenue growth growth PBT growth deleveraging £341.1m £95.5m £58.2m 1.31x Revenue Adjusted EBITDA1 Adjusted PBT1,4 Net leverage2 +6.6% 28.0% 17.1% (£125.1)m Ye
Slide 7: Organic revenue growth accelerated during the year
Financial performance Organic revenue growth accelerated during the year Group Revenue £m H1 YoY H2 YoY FY YoY • Year-on-year growth strengthened at both Reported +6.5% +6.6% +6.6% Moonpig and Greetz in the second half of FY24 Pro forma1,2 +2.1% +6.6% +4.5% • Across Moonpig and Greetz, growth in ord
Slide 8: Significant step-up in growth trajectory in H2 at both Moonpig and Greetz
Financial performance Significant step-up in growth trajectory in H2 at both Moonpig and Greetz Moonpig revenue growth increased Continuing improvement in Resilient trading at Experiences1 in to +11.0% in H2 FY24 the growth trajectory at Greetz a challenging macro context £m £m £m H1 YoY H2 YoY FY Y
Slide 9: Orders growth rate accelerated by +10.2%pts from H1 to H2
Financial performance Orders growth rate accelerated by +10.2%pts from H1 to H2 Moonpig and Greetz Moonpig and Greetz • Significant step-up in orders growth Total Orders Average Order Value in H2 FY24, reflecting: Moonpig and Greetz Orders Moonpig and Greetz AOV Millions of orders £ / order • High s
Slide 10: New customer revenue growth rate increased by +11.6%pts from H1 to H2
Financial performance New customer revenue growth rate increased by +11.6%pts from H1 to H2 Moonpig and Greetz Moonpig and Greetz Revenue from Existing Customers Revenue from New Customers Existing customers1 New customers • Revenue from new customers £m £m returned to growth in H2 FY24 H1 YoY H2 Yo
Slide 11: Cards revenue and attached gifting revenue both strengthened in H2
Financial performance Cards revenue and attached gifting revenue both strengthened in H2 Cards revenue growth strengthened in H2 Attached gifting revenue growth in H2 driven by orders, despite lapping prior year price changes with gift attach rate remaining stable Moonpig and Greetz - Cards revenue
Slide 12: Gross margin rate increased to 59.4%
Financial performance Gross margin rate increased to 59.4% Moonpig Group Gross Profit £m, % of total revenue Group gross margin 56.1% 59.4% Moonpig gross margin 51.8% 55.2% • Group gross margin rate increased by +3.3%pts Greetz gross margin 46.8% 47.1% reflecting continued focus on rate improvement
Slide 13: Group Adjusted EBITDA margin rate increased to 28.0%
Financial performance Group Adjusted EBITDA margin rate increased to 28.0% Moonpig Group Adjusted EBITDA £m, % of total revenue Group margin rate 26.3% 28.0% ● Adjusted EBITDA1 margin rate increased by Moonpig margin rate 26.8% 30.1% +1.7%pts reflecting: Greetz margin rate 20.3% 15.3% ● Increase of
Slide 14: Adjusted PBT increased year-on-year by +5.0%
Financial performance Adjusted PBT increased year-on-year by +5.0% Adjusted EBITDA to Adjusted PBT £m FY24 FY23 YoY • Adjusted PBT of £58.2m stated excluding acquisition amortisation, which we now classify as an Adjusting Adjusted EBITDA1 95.5 84.2 11.3 Item. Current and prior year are presented con
Slide 15: Strong cash generation, with operating cash conversion rising to 78%
Financial performance Strong cash generation, with operating cash conversion rising to 78% Adjusted EBITDA to Operating Cash Conversion £m FY24 FY23 YoY Adjusted EBITDA 1 95.5 84.2 11.3 • Operating cash flow increased by 32% to £74.2m in FY24, driven by: Intangible capital expenditure (12.7) (12.9)
Slide 16: Continued rapid deleveraging
Financial performance Continued rapid deleveraging Net Debt and Net Leverage £m April 2024 April 2023 • Net leverage improved to 1.31x at 30 April 2024 Bank borrowings1 (118.4) (170.5) driven by earnings growth and reduced borrowings Gross cash 9.6 22.4 • Year-on-year £43m reduction in net debt Bank
Slide 17: We remain disciplined in our approach to capital allocation
Financial performance We remain disciplined in our approach to capital allocation Target net leverage ratio • Over the past two financial years, the Group has focused on deleveraging. In FY24, we reduced net leverage from 1.99x to 1.31x, a decrease of approximately 0.7 turns. Given our strong cash g
Slide 18: Current trading and outlook
Financial performance Current trading and outlook • Trading since the start of the year has been in line with our expectations, with both new and existing customer orders in growth. • In the context of the current macroeconomic environment, we expect FY25 revenue growth (after adjusting for temporar
Slide 19: Strategic Update
moonpig group ple Luxury Afte Tea for Two Strategic Update
Slide 20: At Moonpig and Greetz, we leverage data to drive loyalty and gift upsell
Strategic update At Moonpig and Greetz, we leverage data to drive loyalty and gift upsell Card-first Gift attach Profitable customer acquisition The most relevant gifting platform with high loyalty with minimal acquisition cost ✔ 541 million card buyers in UK & NL ✔ >70%3 cards given with a gift ✔ S
Slide 21: Moonpig and Greetz have three compounding growth drivers
Strategic update Moonpig and Greetz have three compounding growth drivers 72% of occasions Monetising the base where a gift is purchased alongside a card1 × Gift attach 23 total cards per year2 × shift to online Driving the Share of wallet 53.8m total card customers in our markets3 Customer acquisit
Slide 22: Growth in Moonpig Plus subscriptions surpassed our expectations
Strategic update Growth in Moonpig Plus subscriptions surpassed our expectations • Moonpig Plus subscriptions passed over half a million members within a year of launch • Driving incremental customer lifetime value • Promising early renewal rates for the first cohort who joined in June 2023 • Greetz
Slide 23: Enhanced deployment of AI to personalise customer experience
Strategic update Enhanced deployment of AI to personalise customer experience Significantly upgraded algorithms now Introduced personalisation elements Launched AI semantic search capability, incorporate customer level data into our across the online journey, including which will drive increasingly
Slide 24: Differentiated creativity features to drive customer lifetime value
Strategic update Differentiated creativity features to drive customer lifetime value Flexible photos and “Sticker” images including Audio and video messages AI-driven Smart Text moveable text boxes licensed content 24
Slide 25: Encouraging momentum cross selling Experience gifts on Moonpig
Strategic update Encouraging momentum cross selling Experience gifts on Moonpig Gift experience voucher printed inside Same day gifting unlocked by combining Expanded range of experiences the physical card experience with eCard 25
Slide 26: Refreshed brand identities, range expansion and enhanced technology
Strategic update Refreshed brand identities, range expansion and enhanced technology Focused brand identities to increase Establishing partnerships with premium Leveraging customer insights to enhance appeal to target audience and hero brands upselling strategies Premium dining partners Mid-range pa
Slide 27: Pipeline of early-stage revenue expansion initiatives in new markets
Strategic update Pipeline of early-stage revenue expansion initiatives in new markets Ireland Australia US • Revenue from Moonpig websites in Ireland, Australia and the US grew by 34% to £8.7m • Targeted testing underway to identify profitable ways to scale marketing activity in new geographical mar
Slide 28: Revenue and profit growth underpinned by technology
28 Revenue and profit growth underpinned by technology 1 Strong performance, which accelerated through the year 2 We are delivering against our technology-led strategy 3 Renewed confidence in our outlook
Slide 29: MOONHIG group ple
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Slide 30: Appendix
moonpig group ple Happy Birthday sam! Have the best time, Owen Sam - Happy Birthdayyyyy! in. Love Stef xx Create a Group Card Appendix 30
Slide 31: Technical guidance (1 of 2)
Technical guidance (1 of 2) • We expect total recurring tangible and intangible capital expenditure to equate to between 4% and 5% of revenue in FY25, and we plan to maintain this ratio in the same range going forward. Within this, we expect that tangible capital expenditure will be in the Capital r
Slide 32: Technical guidance (2 of 2)
Technical guidance (2 of 2) • Margin on the Revolving Credit Facility (over reference rate) is based on a leverage ratchet as follows: Net leverage Margin (bps) >3.00x 325 >2.50x <=3.00 300 RCF costs >2.00x <=2.50 275 (within net finance >1.50x <=2.00 250 charges) >1.00x <=1.50 225 <=1.00 200 • Comm
Slide 33: Alternative Performance Measures
Alternative Performance Measures Reconciliation of Alternative Performance Measures to IFRS Measures FY24 FY24 FY24 FY23 FY23 FY23 Adjusted Adjusting IFRS Adjusted Adjusting IFRS £m Measures Items Measures Measures Items Measures EBITDA 95.5 (3.5) 92.0 84.2 (13.1) 71.1 Depreciation and amortisation
Slide 34: Acquisition amortisation is now classified as an Adjusting Item
Acquisition amortisation is now classified as an Adjusting Item Adjusting Items Year ended Year ended Year-on-year £m 30 April 2024 30 April 2023 movement Pre-IPO share-based payment charges (1.1) (5.4) 4.3 Pre-IPO bonus awards (2.4) (3.3) 0.9 M&A related transaction costs - (4.4) 4.4 Adjusting Item
Slide 35: Impact of classifying acquisition amortisation as an Adjusting Item (1 of 2)
Impact of classifying acquisition amortisation as an Adjusting Item (1 of 2) Impact of revising the definition of Adjusting Items to include acquisition amortisation Revised definition Previous definition Year-on- Year-on- £m FY24 FY23 FY24 FY23 year % year % Revenue 341.1 320.1 6.6% 341.1 320.1 6.6
Slide 36: Impact of classifying acquisition amortisation as an Adjusting Item (2 of 2)
Impact of classifying acquisition amortisation as an Adjusting Item (2 of 2) Historical P&Ls with revised definition of acquisition amortisation as an Adjusting Item £m FY181 FY191 FY201 FY21 FY22 FY23 FY24 Revenue 87.9 120.1 173.1 368.2 304.3 320.1 341.1 Adjusted EBITDA 19.0 22.7 44.4 92.1 74.9 84.