Car Group Limited · ASX:CAR
Car — carsales.com — H1 FY2019 Earnings Presentation
38 slides from Car's earnings presentation, Feb 13, 2019
Slide 1: Half Year Results Presentation
For personal use only HALF YEAR RESULTS PRESENTATION HALF YEAR ENDED 31 DECEMBER 2018
Slide 2: Disclaimer and Non-IFRS Information
DISCLAIMER AND NON-IFRS INFORMATION For personal use only Disclaimer Non-IFRS Financial Information The material in this presentation has been preparation of such statements, actual carsales' results are reported under prepared by carsales.com Limited (ASX: results may vary in a material manner. Int
Slide 3: Contents
CONTENTS For personal use only Key Highlights 4–6 Reported Group Financial Performance 7 – 12 carsales Domestic 13 – 20 carsales International 21 – 30 Outlook 31 – 32 Appendix 33 - 38 3
Slide 4: Key Highlights
For personal use only KEY HIGHLIGHTS TO 31 DECEMBER 2018 4
Slide 5: H1 FY19 Highlights
H1 FY19 HIGHLIGHTS For personal use only Financial summary Reported revenue Revenue up 17%, EBITDA up 8% and Adjusted NPAT* down 2% when compared with pcp. Excluding the impact of the SK Encar acquisition, revenue was up 3% and EBITDA was Up 17% to $235.0m down 7%. Reported NPAT** down 82% on pcp pr
Slide 6: Strong Track Record of Financial Performance
STRONG TRACK RECORD OF FINANCIAL PERFORMANCE For personal use only Revenue ($m)** EBITDA ($m)** Adjusted NPAT* ($m)** CAGR CAGR CAGR 12% 8% 7% 235.0 61.4 60.2 98.0 54.9 200.5 91.0 51.6 178.6 81.5 83.2 46.7 167.3 72.9 150.9 H1 FY15 H1 FY16 H1 FY17 H1 FY18 H1 FY19 H1 FY15 H1 FY16 H1 FY17 H1 FY18 H1 FY
Slide 7: Reported Group Financial Performance
For personal use only REPORTED GROUP FINANCIAL PERFORMANCE TO 31 DECEMBER 2018 7
Slide 8: Summary Revenue & EBITDA Performance
SUMMARY REVENUE & EBITDA PERFORMANCE Half Year Ending $A Millions Growth Revenue For personal use only 31 December 2018 H1 FY18* H1 FY19 $'s % • Half year revenue of $235.0m, up large part reflecting challenging Revenue 17% on pcp. Revenue growth of 3% market conditions. Online Advertising 142.0 146
Slide 9: EBITDA Margin Performance
EBITDA MARGIN PERFORMANCE For personal use only Core EBITDA margins expanded but were offset by Stratton’s performance 45.4% 0.1% (1.4%) and our lower margin / high growth domestic and international investments. (1.6%) • Reported Group margins moved on pcp, primarily reflecting an 0.2% (1.0%) from 4
Slide 10: Look Through Summary
LOOK THROUGH SUMMARY For personal use only International businesses now contribute more than 20% of look through revenue and 15% of look through EBITDA which will continue to strengthen despite ongoing investment in Argentina and Mexico. International look through revenue and EBITDA grew 79% and 83%
Slide 11: Adjusted Net Profit After Tax Summary
ADJUSTED NET PROFIT AFTER TAX SUMMARY For personal use only Half Year Ending $A Millions Growth • The analysis adjacent reflects the • Net finance costs growth reflects 31 December 2018 H1 FY18** H1 FY19 % Adjusted net profit after tax additional interest incurred on results of the business for H1 f
Slide 12: Reported Debt and Cash Flow
REPORTED DEBT AND CASH FLOW Robust balance sheet and credit metrics For personal use only Pre-tax Operating Cash Flow** (column) Reported Leverage Ratio* and conversion from EBITDA to cash (line) (Net Debt/Annualised EBITDA ***) 100.0 90.9 120% 66.0 75.4 73.8 100% 80.0 71.0 93% 80% H1 FY18 0.95 60.0
Slide 13: carsales Domestic (Australia)
For personal use only CARSALES DOMESTIC (AUSTRALIA) TO 31 DECEMBER 2018 13
Slide 14: Our Domestic Business Strategy
OUR DOMESTIC BUSINESS STRATEGY For personal use only OUR DOMESTIC STRATEGY Grow our core advertising solutions, expand into adjacent markets and develop value driven opportunities for our two key customer divisions of Commercial and Consumer. OUR CUSTOMERS STRATEGIC OPPORTUNITIES Core Digital Advert
Slide 15: Clear Leader Across All Metrics of Reputation, Site Engagement and Inventory
CLEAR LEADER ACROSS ALL METRICS OF REPUTATION, SITE ENGAGEMENT AND INVENTORY For personal use only Average Daily Monthly Audience1 Inventory2 Average Time Spent on Site3 +61% +40% +66% nearest carsales nearest carsales nearest carsales competitor competitor competitor Most Preferred Place to Buy & S
Slide 16: Dealer Performance Summary
DEALER PERFORMANCE SUMMARY For personal use only Dealer revenue up 8% on pcp to $75.0m Growth in regular users of promote products** CAGR GROWTH 9% 45% $75.0 $69.2 $64.6 $58.8 $53.8 ($m) H1 FY15* H1 FY16* H1 FY17* H1 FY18* H1 FY19 H1 FY18 H1 FY19 Solid growth in core dealer advertising revenue drive
Slide 17: Private Performance Summary
PRIVATE PERFORMANCE SUMMARY For personal use only Private revenue up 12% on pcp to $41.5m CAGR 18% $41.5 $37.0 $30.7 $24.4 $21.2 ($m) H1 FY15* H1 FY16* H1 FY17* H1 FY18* H1 FY19 Solid growth in core private advertising Products such as Instant Offer and product reflecting the continued Redbook Inspe
Slide 18: Display Performance Summary
DISPLAY PERFORMANCE SUMMARY For personal use only Display revenue down 16% to $29.9m CAGR 2019 Key Display Opportunities -1% $34.5 $35.8 $30.9 $31.6 $29.9 NEW CAR NATIVE & VIDEO OEM ($m) Refreshed new car Focus on native, Stronger OEM offerings that audience and video relationships with support the
Slide 19: Data, Research and Services Performance Summary
DATA, RESEARCH AND SERVICES PERFORMANCE SUMMARY For personal use only Data, Research and Services revenue up 6% to $21.8m CAGR 9% $21.8 $20.6 $19.2 $17.4 $15.2 ($m) H1 FY15* H1 FY16* H1 FY17* H1 FY18* H1 FY19 RedBook IQ provides our automotive clients with a cloud-based set of interactive tools, mar
Slide 20: Finance and Related Services Performance Summary
FINANCE AND RELATED SERVICES PERFORMANCE SUMMARY For personal use only Half Year Ending $A Millions Growth Finance and related services revenue down 4% 31 December 2018 H1 FY18 H1 FY19 $'s % to $30.9m Core Finance 23.2 19.6 (3.6) (16%) Other products 8.9 11.3 2.4 28% Overall core finance contract lo
Slide 21: carsales International
For personal use only CARSALES INTERNATIONAL TO 31 DECEMBER 2018 21
Slide 22: International Summary
INTERNATIONAL SUMMARY Consolidated Entities For personal use only Constant $A Millions Growth International - reported results Currency Summary H1 FY18 H1 FY19 $'s % (%)** • Excellent progress in our international expansion strategy Revenue with a significant increase to revenue and EBITDA SK Encar
Slide 23: Our International Strategy
OUR INTERNATIONAL STRATEGY Investments are optimised via carsales deploying its strategic, product and technology capabilities For personal use only 1. 1. Increase sustainable quality audience and traffic through SEO optimisation and brand marketing ESTABLISH CLEAR MARKET-LEADING 2. Deploy key techn
Slide 24: carsales Asia – SK Encar
CARSALES ASIA – SK ENCAR For personal use only Pro-Forma (100%)* H1 FY18 H1 FY19 PCP Financial commentary: KRWb KRWb % Reported revenue 19.9 23.8 20% • Pleasing EBITDA growth of 22% as operating leverage is being achieved. Reported EBITDA 8.7 10.6 22% • Good growth across all key revenue channels of
Slide 25: SK Encar's Growth Opportunity
SK ENCAR’S GROWTH OPPORTUNITY Large Market Opportunity Australia South Korea For personal use only GDP Annual cars Subscribed Site Visits CY18 Revenue (A$ trillion) sold (m) dealers (000s) (m) (A$m) Growth Opportunities • Economic / structural. South Korea is the 12th largest 2.1 economy in the worl
Slide 26: carsales Latin America – Webmotors
CARSALES LATIN AMERICA – WEBMOTORS For personal use only Pro-Forma (100%) H1 FY18 H1 FY19 PCP Financial commentary: BRLm BRLm % Underlying revenue* 67.5 88.7 31% • Another outstanding financial performance in H1 FY19 as Webmotors continues to consolidate its position as the clear Underlying EBITDA*
Slide 27: Webmotors' Growth Opportunity
WEBMOTORS’ GROWTH OPPORTUNITY Significant Market Opportunity Australia Brazil For personal use only GDP Annual cars Subscribed Site Visits CY18 Revenue (A$ trillion) sold (m) dealers (000s) (m) (A$m) Growth Opportunities 2.8 13.3 13.3 22.6 23.0 343 • Economic. Brazil, the 8th largest economy in the
Slide 28: carsales Latin America – carsales Chile
CARSALES LATIN AMERICA – CARSALES CHILE For personal use only H1 FY18 H1 FY19 PCP Financial commentary: CLPm CLPm % • Completed the acquisition of the remaining 16.7% of the Reported revenue 1,121 1,434 28% chileautos business in December 2018. Reported EBITDA 391 401 2% • Good financial performance
Slide 29: carsales Latin America – Demotores Argentina
CARSALES LATIN AMERICA – DEMOTORES ARGENTINA For personal use only Commentary H1 FY18 H1 FY19 PCP • Strategy in Argentina is to focus on • Achieving 15% revenue growth was a ARS $'000 ARS $'000 % establishing demotores as the clear creditable result in a challenging and dominant market leader from a
Slide 30: carsales Latin America – Mexico
CARSALES LATIN AMERICA – MEXICO For personal use only Commentary Pro-Forma (100%) H1 FY18 H1 FY19 PCP • Significant progress made on our • Successfully launched finance and MXN $'000 MXN $'000 % goal to become the clear and insurance integrations with dominant market leader in Mexico. commercial par
Slide 31: FY19 Outlook
For personal use only FY19 OUTLOOK 31
Slide 32: Performance Outlook
PERFORMANCE OUTLOOK For personal use only We continue to monitor our performance and market conditions in each market in which we operate. Assuming these remain consistent, we anticipate revenue, EBITDA and Adjusted NPAT growth will be moderate in the second half of FY19. carsales Domestic Outlook c
Slide 33: Appendix
For personal use only APPENDIX 33
Slide 34: Overview of carsales Non-IFRS Financial Information
OVERVIEW OF CARSALES NON-IFRS FINANCIAL INFORMATION For personal use only What is IFRS and non-IFRS financial information presented is sourced directly presentations in order to allow the reader to information? from financial information prepared in clearly reconcile between the IFRS and non- accord
Slide 35: Reconciliation of Reported to Adjusted NPAT
RECONCILIATION OF REPORTED TO ADJUSTED NPAT For personal use only Half Year Ending $A Millions Growth 31 December 2018 H1 FY18 H1 FY19 $'s % Reported NPAT 60.6 11.1 (49.5) (82%) Interest Adjustments Option Discounting Unwind - 0.2 Option Movement in Fair Value - (1.2) Investment Adjustments Gain on
Slide 36: Adjusted Financials
ADJUSTED FINANCIALS For personal use only $A Millions H1 FY18 H1 FY19 Growth % Year Ending 31 December 2018 Reported Adjustments Adjusted Reported Adjustments Adjusted Reported Adjusted Revenue Online Advertising 142.0 142.0 146.4 146.4 3% 3% Data, Research and Services 20.6 20.6 21.8 21.8 6% 6% car
Slide 37: carsales "Look Through" P&L Analysis
CARSALES “LOOK THROUGH” P&L ANALYSIS For personal use only H1 FY18 H1 FY19 Growth Look Look Look % Owned Days Owned Reported Underlying % Owned Days Owned Reported Underlying Reported % Underlying % Through Through Through % Revenue carsales International iCar Asia 13.3% 184 Financial Asset* - - 13.
Slide 38: For personal use only
For personal use only