Motus Holdings Limited · JSE:MTH
Motus — Investor Day (June 2024)
69 slides from Motus's investor day presentation, Jun 20, 2024
Slide 1: Capital Markets Day
Capital Markets Day 20 June 2024
Slide 2: The journey so far
The journey so far Osman Arbee 1
Slide 3: What today holds
What today holds - I will show you the journey Motus has been on since listing in November 2018. - Ockert Janse van Rensburg will expand on our strategies, showing Motus’ future vision & mission. - Kerry Cassel will unpack the Mobility Solutions business. - Kerry Cassel & her innovation team will di
Slide 4: Historical operating profit lens
Historical operating profit lens (Rm) What Motus was What Motus has become 5 723 5 029 3 838 3 620 3 593 2 136 2018 2019 2020 2021 2022 2023 2024 Establishment period Growth period & stabilisation as a standalone listed entity from Nov 2018 Structural following acquisitions R3,6 billion to R3,8 bill
Slide 5: Foundation for growth
Foundation for growth Internationalisation Diversification Aim: Increase contribution from international operations Aim: Increase diversification between vehicle & non-vehicles contributions Target: 65% EBITDA generated in South Africa & Target: 50% EBITDA generated from vehicle sales & 35% EBITDA g
Slide 6: Acquisitions supporting Internationalisation & Diversification
Acquisitions supporting Internationalisation & Diversification International Aftermarket Parts businesses (UK & Asia) − Exceeded expectations on financial performance with EBITDA having grown from R70 million in 2019 & projected to grow to in excess of R1 billion for June 2024. − Generating signific
Slide 7: Acquisitions supporting Internationalisation
Acquisitions supporting Internationalisation Expansion of UK Retail vehicle business Expansion of Passenger Vehicles in Australia − Doubled total UK Retail vehicle revenue from 2018, − Increased passenger dealerships from ~27 in 2018, which was supported by acquisitions since unbundling. to ~46 in D
Slide 8: Capital allocation
Capital allocation Working capital & Strategic vehicles for hire Investment in acquisitions Capital innovation & expenditure digitisation Standard Dividends & Selective acquisitions working capital & Share Repurchases that align with our vehicles for hire Standard capex & Continuous investment. inte
Slide 9: Free cash flows since unbundling
Free cash flows since unbundling Free cash flows from operations Debt funding ~R22,0bn - R22,5bn R2,5bn – R3,0bn ~R8,0bn – R8,3bn Shareholder Returns1 ~R7,6bn Investments ~R6,0bn - R6,3bn Vehicles for Hire Significant cash generation & responsible ~R3,2bn - R3,4bn Capital Expenditure capital allocat
Slide 10: What to expect for 2024 full year results
What to expect for 2024 full year results Financial measure Previous guidance provided1 Revised guidance2 Revenue Deliver positive revenue growth Deliver single digit revenue growth EBITDA Deliver positive EBITDA growth Deliver EBITDA in line with prior year Financial measure HY1 FY24 achievement1 G
Slide 11: Progress against key initiatives to reduce inventory & vehicles for hire
Progress against key initiatives to reduce inventory & vehicles for hire Initiatives Progress Inventory Following OEM engagements, most reduced orders & provided financial assistance, such as FOB support, marketing support, retail support (”cash on the bonnet”). Internal targets were set, with conti
Slide 12: ESG milestones I Our people
ESG milestones I Our people Management level Dec Transformation journey Black representation 2018 2023 Our strategy is designed Top 25% 46% Black representation 78% to achieve high impact at Senior 33% 53% two levels – individual & Black DP representation 55% organisation. Middle 39% 53% Junior 59%
Slide 13: ESG milestones I Social
ESG milestones I Social Safe scholar Unjani clinic Education# programme# network# − 79 resource centres − 2 847 schools − 197 health facilities − Over 90 000 learners − 2,39 million learners − 663 staff − 100 librarians − 102 400 reflective − 89 000 average employed sashes monthly consults # Life to
Slide 14: ESG milestones I Environmental
ESG milestones I Environmental Total Fuel Purchased Electricity Water June 2023 – June 2023 – June 2023 - 17,1 million litres 65k kWh 673 million litres Reduced by 23% Reduced by 19% Increased by 10% from 2019 from 2019 from 2019 13
Slide 15: What has Motus demonstrated since listing?
What has Motus demonstrated since listing? – Resilience & agility. – Positioned ourselves for sustainability & future growth: Diversification & Internationalisation. – Adapted to changing customer behaviour and environment. – Strong free cash flows, healthy liquidity ratios & strong debt covenants.
Slide 16: Thank you!
Thank you!
Slide 17: Positioned for growth
Positioned for growth Ockert Janse van Rensburg 1
Slide 18: Segments: where we play
Where we play 0 0-6 1-6 >6 years years years years Pre-owned vehicle market Pre-owned vehicle market New vehicle market Life of new vehicle & Trade-in & Trade-in Importation, distribution & Recurring touchpoints after Second sale of vehicle Further vehicle servicing & first sale of vehicle, vehicle
Slide 19: Drivers for performance
Drivers for performance New vehicles We are not reliant on one aspect of the automotive value chain Other Pre- service owned We are the chosen route-to-market for the offerings vehicles entire automotive value chain Agility to serve different areas of the market Value creation Understand the market,
Slide 20: Segmental EBITDA contribution
Segmental EBITDA contribution 3% 10% 8% 14% 15% 20% 25% 7% 7% 16% 2022 15% 2023 Forecast 2024 16% 28% 16% 32% 32% 16% 20% Import and Distribution Mobility Solutions SA Retail and Rental1 SA Aftermarket Parts1 International Retail International Aftermarket Parts Not reliant on only one area of the bu
Slide 21: Markets we serve I Vehicles
Markets we serve I Vehicles New vehicles Pre-owned vehicles − South Africa: − South Africa: − On average we sell 90k to 100k units per year − Market size of ~312k vehicles for the 0-5 year category − Market leaders at ~20% (total) − On average we sell 65k units per year − UK: − Market share ~20% for
Slide 22: Strategy: new & pre-owned vehicles growth
Strategy Growth opportunity New & pre-owned vehicles − Target a new distributor brand (plug & play). − Be dealership group of choice to distribute new entrants’ vehicles, using mature & established route-to-market infrastructure (dealerships, systems, bond stores). − Target the 1st and 2nd replaceme
Slide 23: Strategy: new & pre-owned vehicles sustainability
Strategy Sustainability New & pre-owned vehicles − Reposition our existing footprint to right-size brands (performing & non-performing), including multi-franchising. − Select OEMs where we believe they have a sustainable future. − Pursue volume brands where we are under-represented. − Guide & suppor
Slide 24: Markets we serve I Parts wholesale & retail
Markets we serve I Parts wholesale & retail Car parcs for in warranty vehicles Car parcs for out of warranty vehicles − South Africa: ~3 million vehicles − South Africa: ~9 million vehicles − Importer brands: ~550k vehicles − UK: ~32 million vehicles OEMs represented Number of parts in a vehicle − I
Slide 25: Strategy: aftermarket growth
Strategy Growth opportunity Aftermarket: In warranty & Out of warranty Aftermarket: In warranty − Target a new distributor brand (plug & play). − Be dealership group of choice to distribute new entrants’ parts, using mature & established route-to-market infrastructure (dealerships, systems, distribu
Slide 26: Strategy: aftermarket sustainability
Strategy Sustainability Aftermarket: In warranty & Out of warranty Aftermarket: In warranty − Consolidation of procurement supply chain (inbound & outbound logistics). − Reposition our regional distribution centres to right-size our footprint. Aftermarket: Out of warranty − Supply chain optimisation
Slide 27: Markets we serve I Workshop, vehicle rental & other service offerings
Markets we serve I Workshop, vehicle rental & other service offerings Car parcs Average size of fleet Policies under administration − South Africa: 12 million vehicles − Lowest average fleet size: ~15k − ~1,5 million policies − UK: 40 million vehicles − Highest average fleet size: ~22k Value-added p
Slide 28: Strategy: workshop, rental & services growth
Strategy Growth opportunity Workshop, vehicle rental & other service offerings − Grow out-of-warranty service centres offering. − Continued recovery of vehicle rental industry to pre-Covid levels. − Continuous implementation of digital solutions to serve our Vehicle Rental customers (Ready2GO, autom
Slide 29: Strategy: workshop, rental & services sustainability
Strategy Sustainability Workshop, vehicle rental & other service offerings − The extended replacement cycle is increasing the age of the vehicle parc, which will require higher workshop activity. − Increase workshop productivity through streamlining our aftersales workshop processes & systems. − Cap
Slide 30: Acquisition strategy I Overview
Acquisition strategy I Overview Key to supporting earnings growth and value creation for stakeholders is our on-going strategic initiatives of internationalisation and diversification, together with organic business initiatives and selective bolt-on acquisitions. United Kingdom South Africa Australi
Slide 31: Resources to deliver on strategy
Resources to deliver on strategy Banking facilities Motus has sufficient unutilised banking facilities & headroom on bank covenants to deliver on all business strategies. Total available facilities Rm South Africa 14 839 International 7 598 Total 22 437 International debt funding We have recently re
Slide 32: Thank you!
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Slide 33: Mobility Solutions
Mobility Solutions Overview 1
Slide 34: Channels and Products
Channels and Products 3 VAPS 7 VAPS 10 VAPS 4 VAPS 3 VAPS 4 VAPS 2 Non-Insurance 2 Non-Insurance 3 Non-Insurance 1 Non-Insurance 2 Non-Insurance 2 Non-Insurance 1 Insurance 5 Insurance 7 Insurance 3 Insurance 1 Insurance 2 Insurance VAF VAPS | Value Added Products VAF | Vehicle Asset Finance 2
Slide 35: Products Offering
Products Offering Service Plan Maintenance Plan Extended Warranty Scratch and Dent Vehicle Debt Protector Regular servicing, per Regular servicing, per Unexpected Common damages, Debt Protection the manufacturer’s the manufacturer’s mechanical such as windscreen product developed specification. spec
Slide 36: Products Offering
Products Offering Roadside Credit Life Deposit Cover Tyre & Rim Credit Shortfall Assistance Outstanding debt on Up to a maximum of Damage to a The shortfall between Roadside Assistance the vehicle finance R100 000 deposit vehicle’s tyres and the comprehensive is for those agreement when the when the
Slide 37: Introduction: Business in Quantum
Introduction: Business in Quantum Over 20 Over 11 000 2.3 Million years of telesales vehicle experience every month records R1 billion 1.5 million 2.5 million authorised claim policies under customer payments administration records per annum >470 000 in VAPS & Third 30 billion & outbound party produ
Slide 38: Our Distribution Network
Our Distribution Network Le e « 4) re HYUNDAI MOTORS 2 . Hollard. budget ODiscovery aah (absa} @oenre'e Lod N y 1st for women ~ HKingPrice WesBank auto & general INSURANCE santam & ju SAU WEDARETODELIVER cipmurua. —gialdivect™ PAG dotsure.co.za Inauranee, Nome Your Price!
Slide 39: Diversified Operating Profit
Diversified Operating Profit • Non-Insurance100% VAPS Total MMS (R’m) of OP 1 141 • Insurance VAPS 1 004 939 931 913 • Bank Alliances (VAF) • Consumer Mobility • Fleet 2019 2020 2021 2022 2023 VAPS | Value Added Products VAF | Vehicle Asset Finance 7
Slide 40: Drivers of Operating Profit
Drivers of Operating Profit 8 8
Slide 41: Correlation between Operating Profit and Vehicle Sales
Correlation between Operating Profit and Vehicle Sales R’m Motus Vehicle Sales (New and Used) vs MMS Operating Profit 185 000 R1 200 R1 100 R1 000 175 000 R 900 R 800 165 000 R 700 R 600 155 000 R 500 R 400 R 300 145 000 R 200 R 100 135 000 R- 2020 2021 2022 2023 Motus Vehicle Sales (New & Used) Ope
Slide 42: The South African car parc – A Structural shift
The South African car parc – A Structural shift • The South African Vehicle Car parc is currently 12 million vehicles. • Owners are keeping their vehicles for longer periods which create increased demand for value added products and services (VAPS). • MMS Currently administer more than 1,5 million a
Slide 43: How we drive our strategy for growth
How we drive our strategy for growth • The business is essentially a matrix of products and channels • Growth will be delivered through: • Product Development • Channel Development • Market Development • Data Assets 11
Slide 44: Product Development
Product Development • Strategic stake in telemetry company. • Unique offering in Scratch and Dent. • Development of tech enabled services which enhance vehicle ownership. • White labelled floorplan offerings. 12
Slide 45: Channel development
Channel development • Coin-It is a workshop leads generation platform for VAPS developed in 2016. • Coin-It 2.0 was launched in March 2024. • Performance (Life to Date) • Leads Generated: 349 553 • Sales Made: 93 317 • Sales Conversion: 27% • Funds Received: R 368 million • Coin-It 2.0 features exci
Slide 46: Market Development
Market Development • Strategic Partner to some of South Africa’s leading Insurers: • Discovery • Santam • MiWay • Old Mutual Insure • Continue penetration of new industries: • Our new focus is on Retail. We are in discussions with two of the largest retailers in South Africa. • Our next objective wi
Slide 47: Data Assets
Data Assets • Leveraging proprietary data sets & analytics capabilities to enable the business to manage risk and develop innovative products and services (e.g. Discovery Warranty). • Developing usage-based products using telemetry. • Ongoing investment in cloud storage capabilities • Better capabil
Slide 48: Our People
Our People “Everything we do centres on our Our Values promise of ‘Mobility for Good’ for you, your customer and our communities.” Diversity, Equity & Inclusion • Gender: 58% • ACI: 76% • Disability: 4% • Diverse skill sets 16
Slide 49: Technology
Technology • Market Development Strategy: Ability to integrate with all third parties with ease (key to tie back to partner strategy). • Governance, Risk and Compliance: Significant improvement in overall security have been made over the past view years. The Strategy is to remain up to date and main
Slide 50: Understanding our financials
Understanding our financials • Operating profit includes profit without associated revenues • 3rd Party Alliances in quantum • Banks R 50,0bn • Insurance Cell Captives R 0,5bn • Annuity income streams flow from books of business on actuarial curves • Insurance 3 to 7 years • Non-Insurance 3 to 4 yea
Slide 51: It’s not about what we do – it’s about why we do it
It’s not about what we do – it’s about why we do it • Why are service & maintenance plans so important to us? • Why do we have a roadside assistance business? • Why do we have a motor comprehensive insurance brokerage? • We package Motus’ products and services in innovative ways for South African mo
Slide 52: Thank you!
Thank you! 20
Slide 53: Motus Xponential
Motus Xponential How we Innovate at Motus 1
Slide 54: 2018 … A lot going on for Motus!!!
2018 … A lot going on for Motus!!! 2 2
Slide 55: Our Future Strategy
Sensitivity - Operational Our Future Strategy Leaders “We have to build tomorrow’s products and services today.” Mobility for Innovators good Customer Champions 3
Slide 56: Our Research: ROADSTER
Our Research Dealer Platforms Ridesharing ROADSTER Motus Project Exploration (June 2018) Digital New Marketing Energy Vehicles 4
Slide 57: A Snapshot of the Global Silicon Valley
A Snapshot of the Global Silicon Valley Meet the Pioneers that have shared our stage eS) ase =| , 2 mri aE ae BS Eee EL ae MOTUS Pow = ERING PROGRESg. Silicon Valley
Slide 58: XU Berlin
XU Berlin 6 6
Slide 59: Intrapreneurship
Intrapreneurship What is it? What is awesome about it? “A system that allows • Fosters a culture of innovation. an employee to act • Inclusive. like an entrepreneur • Empowers employees to take within a company or calculated risks. other organisation.” • Attracts top talent . • Enables the organisat
Slide 60: Barriers to Intrapreneurship
Barriers to Intrapreneurship (*) 1. We are trapped. 2. Our understanding of Innovation. • It must be mind blowing. 3. The belief that someone risked it all. Whereas in actual fact the best innovation comes from here. (*) Melissa Kennedy, TEDx Lizard Creek, October 2017 8
Slide 61: INNOVATION = CHANGE THAT MATTERS.
INNOVATION = CHANGE THAT MATTERS. ee se
Slide 62: Our solution - mx
Our solution - mx Launch voluntary Create a culture of Establish a brand for training for employees innovation within innovation. on innovation topics Motus. and trends. Host events Deploy a digital showcasing innovation innovation Measure and reward topics and trends management platform engagement
Slide 63: What makes mx unique?
What makes mx unique? It is a top-down approach to innovating as well as a bottom-up approach. Innovation is fostered and driven within the different businesses within Motus but is supported by the mx team at the centre (centralised as well as decentralised approach). Highly skilled and stand-alone
Slide 64: What makes mx unique?
What makes mx unique? Allows all employees to Popular ideas rise to the contribute to innovation, top and are developed ensuring a diverse range of into prototypes and ideas. solutions through Design Thinking (Evidence-based approach to identify Encourages a culture of valuable and experimentation a
Slide 65: Wins
Wins 4 000 mX Members 13 13
Slide 66: Wins
PHILPS i LIEBHERR Ne Motus” #Innovators Congratulations to Motus for winning third place in the prestigious JTBD Summit Europe.
Slide 67: Do you think Motus has increased its focus on innovation?
Do you think motus has increased its focus on innovation in the last year? 2023 / 2022 2024 75% 84% 15
Slide 68: Conclusion: Innovation Accelerator
Innovation Accelerator > @ 92 Discovery phase Validation phase Scale phase Commercialised Facilitated by m Business Units
Slide 69: Motus Xponential: Thank you!
Motus Xponential Thank you! 17