D'ieteren Group Sa/nv · EURONEXT:DIE
D'ieteren Group Sa/nv — Investor Day (June 2024)
37 slides from D'ieteren Group Sa/nv's investor day presentation, Jun 25, 2024
Slide 1: PHE Day: Promoting affordable and sustainable mobility
PHE Day “Promoting affordable and sustainable mobility” 25 June 2024 – Paris
Slide 2: Presenters / Agenda
Presenters / Agenda 1. INTRODUCTION : PHE AT A GLANCE Stéphane Antiglio CEO 2. MARKET PHE addressable market Christophe Gouthière Market drivers & dynamics CFO 3. PARTS HOLDING EUROPE (PHE) Strategy Jeremy de Brabant COO (B2B) Operating model excellence M&A ESG & People Murielle André CH
Slide 3: PHE at a glance
PHE at a glance A leading omni-channel and digitally enabled Western European auto parts distributor Parts c.275 6 countries 9,500 employees manufacturers suppliers in auto spare parts #5 #1 in Dutch in French LV (1) LV B2B B2B(2) and B2C(3) #2 B2B B2C in Belgian #1 LV B2B c.600 1 in Spanish distrib
Slide 4: Multi-specialist vehicle spare-parts distributor covering all market segments
PHE at a glance Multi-specialist vehicle spare-parts distributor covering all market segments… Today 2016 2018 1962 2014 2017 2019 D’Ieteren Group PHE Day 4
Slide 5: A vast and growing product assortment
PHE at a glance … with a vast and growing product assortment Category Repair & Maintenance Collision Others Mechanical / Tires / Batteries / Paint / Body panels / Doors / Glass / Garage equipment / Diagnosis tools / Lubricant Light / Bumpers Consumables / Accessories Products Contribution to sales(1
Slide 6: PHE plays a critical distribution role in the automotive aftermarket
PHE at a glance PHE plays a critical distribution role in the complex and large automotive aftermarket Manufacturing Distribution Retail / Service Average Key decision car age criteria Car OEM retail Mainly manufacturers sourcing 0-4 yrs (Original Equipment from Certified repairers Manufacturer) OEM
Slide 7: Agenda
Agenda 1. INTRODUCTION : PHE AT A GLANCE 2. MARKET PHE addressable market Market drivers & dynamics 3. PARTS HOLDING EUROPE (PHE) Strategy Operating model excellence M&A ESG & People Financial performance 4. KEY TAKEAWAYS D’Ieteren Group PHE Day 7
Slide 8: A c.€100bn, steadily growing and resilient aftermarket
PHE addressable market A c.€100bn, steadily growing and resilient aftermarket… European auto aftermarket (at distribution level, in €bn) Back to pre- +2% CAGR Covid level +2% CAGR(1) -14% YoY +6% YoY +10% YoY +5% YoY 112 98 102 93 93 85 80 84 2014 2019 2020 2021 2022 2023 2025 2030 Car parc in Europ
Slide 9: A high degree of predictability
PHE addressable market …with a high degree of predictability… Average age of cars served by PHE is 13 years Average age of cars served by PHE: 13yrs OEM IAM 100% Car 0y 5y 30y Scrap production % cars serviced in 2025 by PHE already sold today Ensuring PHE 15+yrs visibility to anticipate & seize long
Slide 10: Underpinned by structural growth drivers
Market drivers … and underpinned by structural growth drivers A Growing & ageing car parc B Dense IAM presence C Increasing technology, complexity and value D Electrification E Regulation / Emissions reduction Other trends Supply chain Sustainability Data / New & inventory Affordability / remanufac-
Slide 11: Consistently growing and ageing car parc
Market drivers A Consistently growing and ageing car parc… Car parc progressively grows and average age expected to Covid accelerated the 13.6 increase at elevated levels due to increase in average age of car parc macro headwinds 12.0 11.5 10.9 10.7 10.5 10.0 9.5 9.1 8.9 2010 2011 2012 2013 2014 201
Slide 12: Favouring IAM increased penetration
Market drivers B … favouring IAM increased penetration Market share trend in Europe by channel (%) 45% 38% 36% 32% 30% OEM 50% 55% 62% 64% 68% 70% IAM 50% 2000 2010 2014 2019 2025e 2035e Decreasing OEM network #OEM car dealers in France (k) -12% -20% • OEM network rationalization 14.7 13.6 13.1 12.9
Slide 13: Content increase, complexity and innovation drive prices up
Market drivers C Content increase, complexity and innovation drive prices up Content increase driving higher retail prices across product categories(A) Especially for Full Electric vehicles(B) Older parts Current parts 1st generation of future parts(1) Internal Combustion (ICE) Full Electric (FEV) T
Slide 14: Electrification represents a long-term opportunity for sizable players
Market drivers – Electrification (1/2) D Electrification represents a long-term opportunity for sizable players like PHE… Increasing component pricing Additional product categories and services offsetting decrease in fossil fuel specific components ICE only components ∆ in Car Content Cost ($) from
Slide 15: Time to adapt given gradual penetration of EVs
Market drivers – Electrification (2/2) D …who have time to adapt and prepare given the gradual penetration of EVs In the LT, mature players as PHE will be better positioned to Slow and progressive EV share ramp-up grasp electrification opportunity BEV in % of light vehicle car parc Short • Reinforce
Slide 16: Supportive EU regulation
Market drivers E Supportive EU regulation Opportunities for IAMs • Right to repair • Favorable for IAMs vs. OEMs Deregulation on captive • Repairability • Opportunity to increase presence in parts • Limited remaining OEM captive spare- younger vehicles parts aftermarket Stringent regulation on • Inc
Slide 17: European distribution market is highly fragmented
Market drivers European distribution market is highly fragmented Top 10 players account for only 1/3 of the European market Distribution revenues per European player [2020; %] 100% c. 20-25% • Highly fragmented market ~ 50k independent distributors accounting for 2/3 of IAM distribution market val
Slide 18: Agenda
Agenda 1. INTRODUCTION : PHE AT A GLANCE 2. MARKET PHE addressable market Market drivers & dynamics 3. PARTS HOLDING EUROPE (PHE) Strategy Operating model excellence M&A ESG & People Financial performance 4. KEY TAKEAWAYS D’Ieteren Group PHE Day 18
Slide 19: PHE's strategy: organic growth, operating excellence and value accretive M&A
PHE’s strategy PHE’s strategy is to foster organic growth, operating excellence and value accretive M&A Organic growth and operating excellence Value accretive M&A • Gain market share and expand leadership position • Continue market consolidation in existing geographies • Continue best-in-class logi
Slide 20: PHE benefits from optimized and efficient operating model
Operating model excellence - Overview PHE benefits from optimized and efficient operating model Extensive partnership network… Central purchasing unit Parts availability • Best-in-class parts availability Logistics platforms • Competitive advantage in purchasing Automated warehouse International pla
Slide 21: A virtuous operating model based on superior assortment and platformization
Operating model excellence – Scale (1/2) A virtuous operating model based on superior assortment and ‘platformization’ … Zoom on next page • Large & growing portfolio of • Wide and controlled supplier 600K SKUs Centralized purchasing portfolio (c.275+ suppliers) Platformization • Higher-margin priva
Slide 22: Optimized purchasing and dynamic supplier approach
Operating model excellence - Scale (2/2) ... and optimized purchasing and dynamic supplier approach 2023 purchases of the main European distributors PHE stands out with its dynamic approach with suppliers • Focused on high-quality suppliers X2 Tier 1 distributors • Longstanding relationships with su
Slide 23: Unparalleled value proposition based on customer centricity
Operating model excellence – Customer (1/2) Unparalleled value proposition based on customer centricity… B2B B2C Affiliated garages (6.8k) Chained IAM operators Pure independent garages + OTC Web dealers Excellent distributor Digital platforms Value-added services Ordering platforms Autossimo Commer
Slide 24: Complemented by a digitized customer journey
Operating model excellence – Customer (2/2) …complemented by a digitized customer journey Leading digital customer experience & services B2B B2C Proprietary Digital tools and platforms Strong B2B online ordering B2C “pick the right part” for garages platform e-commerce Complementary capabilities ass
Slide 25: Logistics excellence, dense distribution network
Operating model excellence - Logistics Logistics excellence, dense distribution network Very dense and efficient distribution network in Western Europe enabling top-tier availability and delivery speed Distribution network coverage hard to replicate by any competitor Network of modern and automated
Slide 26: A value accretive and low risk M&A strategy
M&A strategy PHE has a value accretive and low risk M&A strategy… Track record of low-risk & value-accretive M&A A clear M&A vision Disciplined approach in valuations Select Select Select countries companies approach Significant purchasing synergies generated and continuous operational Where PHE c
Slide 27: Proven track record of generating significant synergies
M&A strategy …with a proven track record of generating significant synergies Synergies framework Key levers Revenue • Roll-out of PHE value proposition fundamentals synergies Creating value on M&A Long list of through M&A pipeline purchasing to consolidate synergies, cost current • Systematic purcha
Slide 28: Promoting affordable and sustainable mobility while reducing impact
ESG – Environment Promoting affordable and sustainable mobility while reducing the impact of our activities PHE’s mission is to promote affordable and sustainable mobility, by helping to extend the life of vehicles and maintaining vehicles in safe and environmentally-friendly conditions. The Group i
Slide 29: A people company supported by a strong culture
ESG – PHE is a people company A people company supported by a strong culture c.9,500 c.9 years 0 workforce average seniority in France strike in France Challenge including • c.54% FTEs > 5 years since 2012 • c.36% FTEs > 10 years thanks to an open dialogue 6,300 • c.25% FTEs > 15 years with in Franc
Slide 30: Track record of significant profitable growth
Financial performance Highly successful financial track record of significant profitable growth under current management… International expansion ~2.5x • Sales driven by organic growth through a strong business model as well as M&A 2,557(3),(4) bigger 2,260(3) growth 1,797 1,964(3) 1,762 & 1,444 1,1
Slide 31: Cash generation leading to rapid deleveraging
Financial performance …combined with cash generation leading to rapid deleveraging 2.2% 2.3% 2.2% 1.8% 2.1% 2.0% 1.8% ~1.9x • Strong cash conversion as a result of positive stronger EBITDA growth, disciplined capital cash expenditure approach and working capital conver- management 40 38 47 47 28 33
Slide 32: 2024 outlook and Q1-24 sales trading update
Financial performance 2024 outlook and Q1-24 sales trading update 2024 outlook Q1-24 sales trading update • Total Q1-24 sales of €696.3m • 6.4% YoY growth in Q1-24 driven by: • Mid-single digit organic sales growth driven 3.8% organic growth and 2.6% from by market share gains and a normalised acq
Slide 33: Relationship with D'Ieteren Group
Relationship with D’Ieteren Group Strong relationship with our long-term shareholder Support Engage Contribute • Strategy & M&A • Incentive scheme • Best practice exchange • Financing • Alignment on long-term vision • Digitization • ESG • Clear governance D’Ieteren Group PHE Day 33
Slide 34: Agenda
Agenda 1. INTRODUCTION : PHE AT A GLANCE 2. MARKET PHE addressable market Market drivers & dynamics 3. PARTS HOLDING EUROPE (PHE) Strategy Operating model excellence M&A ESG & People Financial performance 4. KEY TAKEAWAYS D’Ieteren Group PHE Day 34
Slide 35: Key takeaways: winning business model driving consistent value creation
Key takeaways Winning business model driving consistent value creation in distribution 1 PHE’s market is large, structurally growing, resilient, fragmented and predictable, mainly driven by a growing and ageing car parc and characterized by increasing value and complexity 2 PHE has significant and e
Slide 36: Forward-looking statement
Forward-looking statement “To the extent that any statements made in this presentation contain information that is not historical, these statements are essentially forward-looking. The achievement of forward-looking statements contained in this presentation is subject to risks and uncertainties beca
Slide 37: Contact information
Contact information Investors Press Stéphanie Voisin Anne-Catherine Zoller stephanie.voisin@dieterengroup.com anne-catherine.zoller@dieterengroup.com T. +32 2 536 54 39 T. +32 2 536 55 65 M. +32 478 48 58 71 www.dieterengroup.com D’Ieteren Group PHE Day 37