Slide 1: Analyst Detailed Financials
ANALYST DETAILED _. FINANCIALS
Slide 2: Important information
2 Important information This report contains forward-looking statements as defined in the United States Private Securities Litigation Reform Act of 1995. Words such as “believe”, “anticipate”, “intend”, “seek”, “will”, “plan”, “could”, “may”, “endeavor” and similar expressions are intended to identi
Slide 3: Index
3 Index Operations 04 Financials 14 30 Appendix 43
Slide 4: Operations
OPERATIONS NASPERS
Slide 5: Classifieds: Strengthening the core
5 Classifieds: Strengthening the core We invested to build out a • OLX is one of the world's leading and We are the largest… fastest growing online marketplaces. customer-centric ecosystem • The strategy is to focus and invest to Global footprint - 38 countries1 further scale the core markets and ma
Slide 6: Classifieds: Monetisation metrics continue to improve
6 Classifieds: Monetisation metrics continue to improve OLX Group: Average revenue/internet user (ARPIU) 1 : Average monthly paying listers (m)2 • Classifieds continued to increase monetisation countries (US$) monetisation rates. • Monetising countries delivered a 29% 33% healthy 46% EBITDA margin.
Slide 7: Classifieds: Focus on key markets – Avito and Poland
7 Classifieds: Focus on key markets – Avito and Poland Avito • Consolidated the remaining minorities for US$1.2bn in January, increasing the group’s effective stake to 100%. .pl • Avito continued to solidify its position, growing revenues 28% YoY to RUB21bn, at a 57% trading profit margin. # paying
Slide 8: Classifieds: Focus on key markets – Brazil and letgo
8 Classifieds: Focus on key markets – Brazil and letgo OLX Brazil • OLX Brazil grew revenue 44% on the back of expanded monetisation in its cars verticals. • Key initiatives include launching Brazil Autoshift (vertical of autos specialised in professional advertisers) and new value added services su
Slide 9: Food delivery: Leader in markets with huge potential
9 Food delivery: Leader in markets with huge potential • Over US$2bn invested in food in the past three years as we see a significant Global footprint: Annualised orders (m)2 opportunity in this sector. Current Leadership position in 361 of our markets 100% analyst consensus valuation for stakes in
Slide 10: iFood more than doubled its size after funding in 1HFY19
10 iFood more than doubled its size after funding in 1HFY19 iFood investing to accelerate scale • iFood is the clear leader in Brazil in terms of scale and customer satisfaction. Annualised orders (m)2 • Utilising a commitment to invest 107% ~US$400m, iFood more than doubled its size. Monthly orders
Slide 11: Building leadership positions in the markets in which we operate
11 Building leadership positions in the markets in which we operate • Delivery Hero (DH) is focused on Delivery Hero fortifying strongholds Swiggy investing in winning innovations building a 1P delivery business, as well as deep optimisation of its delivery logistics. Market leader in 33 of 411 coun
Slide 12: Payments & Fintech: Scaling core business, doubling down on India
12 Payments & Fintech: Scaling core business, doubling down on India Global footprint – operations in 18 markets • In the Payments business the focus Average daily transactions (m)1 remains on global, high-velocity merchants. PayU partners with several 44% global online leaders with multiregional de
Slide 13: Etail: Solid growth and improving economics
13 Etail: Solid growth and improving economics eMAG Group: • eMAG remains the leading online retailer in Romania. Supported by strong traffic growth, eMAG Romania recorded 25% GMV growth YoY. 15% (21%) • eMAG Romania is profitable. 43% (53%) Takealot Group: • Takealot.com’s leadership in South GMV (
Slide 14: Financials
FINANCIALS NASPERS
Slide 15: Summary financials for continuing operations
15 Summary financials for continuing operations Revenue (US$bn)1,2 Trading profit (US$bn)1,2 16% (29%) 10% (22%) 19.0 3.0 3.3 16.4 FY18 FY19 FY18 FY19 Core headline earnings (US$bn)2 Dividend per share (ZAc)3 26% (26%) 10% 3.0 715 2.4 650 FY18 FY19 FY18 FY19 1 Results reported on an economic-interes
Slide 16: Strong revenue growth and improved profitability
16 Strong revenue growth and improved profitability • Revenue growth remains strong at Constant currency revenue and trading profit growth by segment (%)1 29% YoY for the group. Profitability has Revenue significantly improved, with trading Trading profit profit growth reported at 22%. • Overall eco
Slide 17: Improving operating leverage across ecommerce
17 Improving operating leverage across ecommerce YoY change in trading loss/profit margins (%)1 • Margins improved across the TP Margin FY18 ecommerce segment – the only TP Margin FY19 exception being food delivery, where investment was stepped up. 10% 18% • Classifieds continued to show strong prof
Slide 18: Consolidated development spend continued to trend downwards
18 Consolidated development spend continued to trend downwards Development spend (US$m)1 • Consolidated development spend was down 18% YoY (US$101m) as ecommerce continued to scale. -17% (-18%) • The decrease is mainly due to: 759 601 - Reduced spend at letgo and the 500 rest of the Classifieds port
Slide 19: Development spend on an economic interest basis also decreased
19 Development spend on an economic interest basis also decreased Development spend (US$m)1 • Naspers’ proportionate share of development spend of associates and -12% (-10%) joint ventures (i.e. the difference 978 882 between development spend on an 783 economic-interest and consolidated basis), amo
Slide 20: Profitable businesses revenue over 50% of ecommerce revenue
20 Profitable businesses revenue over 50% of ecommerce revenue Financial progress of profitable ecommerce businesses (US$m)1 • The group has reached a milestone as Revenue profitable businesses are more than Trading profit Like-for-like 50% of total ecommerce revenues. As reported 15% (26%) • Profit
Slide 21: Classifieds momentum and scale driving profitability
21 Classifieds momentum and scale driving profitability • Consistent execution and focus on user Revenue (US$m)1 Trading (loss)/profit, (US$m)1 needs and competition has driven a 5-year revenue CAGR of over 40%, ahead of industry peers. 39% (37%) Clear progression of profit generation, while • Class
Slide 22: Payments & Fintech: Core business profits reinvested in Credit & Fintech
22 Payments & Fintech: Core business profits reinvested in Credit & Fintech Revenue (US$m)1 Trading loss (US$m)1 Core PSP • PayU reported strong progress in its payments business. Healthy revenue 22% (28%) growth combined with operational efficiencies pivoted this business to 360 Operational efficie
Slide 23: Food delivery: Strong topline growth, strategic investment increasing
23 Food delivery: Strong topline growth, strategic investment increasing • Cumulative annualised order volumes and GMV grew healthily by 100% and 65% (in local currency) respectively for the segment. Revenue (US$m)1 Trading (loss) /profit (US$m)1 • Strong contributions from all businesses with reven
Slide 24: Etail: Increased profitability and margins
24 Etail: Increased profitability and margins Revenue (US$m)1 Trading loss (US$m)1 • Revenue for the segment reduced as Flipkart was disposed of in 1H19. Only 7 months of Flipkart results have been included in the segmental results. This eMAG and Takealot continued to strengthen represents Naspers’
Slide 25: Social and internet platforms: Healthy contributions to earnings growth
25 Social and internet platforms: Healthy contributions to earnings growth Tencent revenue (RMBm)1 Mail.ru revenue (RUBm)2 Tencent 32% 33% • 2018 marked the 20th anniversary of the founding of the Tencent Group. 312 694 75 260 • Tencent grew revenue 32% YoY to 237 760 56 789 RMB313bn, with growth in
Slide 26: Segmental detail
26 Segmental detail Revenue EBITDA Trading profit FY18 FY19 % FY18 FY19 % FY18 FY19 % US#039;m US#039;m Change US#039;m US#039;m Change US#039;m US#039;m Change Internet 15 863 18 678 18% 3 342 3 813 14% 3 013 3 339 11% Ecommerce 3 582 3 934 10% (655) (556) 15% (713) (613) 14% - Classifieds 628 875 39% (99) 19 >100%
Slide 27: Ecommerce “Other”
27 Ecommerce “Other” • FY19 Naspers Ventures acquisitions Revenue (US$m) FY18 FY19 Trading loss (US$m) FY18 FY19 included: BYJU’s, Honor, dott and Sololearn. Other ecommerce 223 241 Ecommerce other and corporate1 (174) (214) • The group signed a deal post year end to dispose of it’s interest in Busc
Slide 28: Improved ecommerce profitability contributed significantly to FCF
28 Improved ecommerce profitability contributed significantly to FCF Consolidated trading profit from profitable ecommerce Sources of free cash inflow excluding VE (US#039;m)1 • Improved ecommerce profitability, businesses (US$m) particularly in Classifieds, resulted in a 22% greater contribution to ov
Slide 29: 60% improvement in FCF
29 60% improvement in FCF US$m Continuing operations1 • The timing of the unbundling of FY18 FY19 MultiChoice came just as the Classifieds EBITDA (410) (331) and core PSP businesses turned profitable. Cash generated from Non-cash items 50 27 operations increased 33% or US$125m. Working capital (18)
Slide 30: Holding company sources of cash and commitments
30 Holding company sources of cash and commitments • Inflows increased by 64%. US$m FY18 FY19 • Interest income has been included in the analysis as it is now quite Cash remitted to/generated at Holdco level: meaningful for the group given cash and Tencent dividend 247 332 short term investment bala
Slide 31: Healthy returns from exits, M&A focused on core segments
31 Healthy returns from exits, M&A focused on core segments • Significant FY19 investments include: Acquisitions/Investments over time (US$m) Exits (US$m) - Avito (US$1.16bn) - Swiggy (US$716m) 3 057 - BYJU’s (US$383m) 2 200 - Dubizzle (US$190m) - letgo USA B.V (US$189m) - Frontier Car Group (US$89m
Slide 32: Continuing to generate excellent returns
32 Continuing to generate excellent returns • By comparing all internet investments (excluding Tencent) since 2008 against All internet investments excluding Tencent Current internet portfolio excluding Tencent current market valuations, Naspers (FY08 – FY19), (US$bn)1,2 (US$bn)1,2,3 generated an IR
Slide 33: Summarised income statement
33 Summarised income statement US$m FY18 FY19 • Increase of US$125m in share of equity accounted investments relates to: Continuing operations: - Increased Tencent profits; Revenue1 16 352 18 990 - Reduced losses from Flipkart, Less: Equity-accounted investments (13 367) (15 699) MakeMyTrip and Deli
Slide 34: Finance costs down YoY
34 Finance costs down YoY US$m FY181 FY19 Interest paid and received • Interest paid remained stable. • Interest received increased by US$232m Interest received 52 284 YoY, due to higher cash and short-term Loans and bank accounts 49 283 cash investment balances. Other 3 1 Other finance costs Intere
Slide 35: Contribution by associates and joint ventures
35 Contribution by associates and joint ventures Company PPA IFRS Other Core HE • Equity-accounted results include, FY19 (US$m) results adjustments results adjustments contribution amongst others, the group’s share of Tencent1 3 696 - 3 696 (109) 3 587 the earnings of Tencent, Mail.ru, MMT, Delivery
Slide 36: Healthy increase in core headline earnings
36 Healthy increase in core headline earnings Trend in core headline earnings per share (US$) • Core headline earnings (which excludes once-off and non-operating items such as amortisation of intangible assets CAGR +44% 26% recognised in business combinations, etc.), is not defined under IFRS, but i
Slide 37: Core headline earnings from continuing operations reconciliation
37 Core headline earnings from continuing operations reconciliation • Main contributor of core headline earnings growth was Tencent, contributing US$3.6bn (+9% YoY). US$m FY18 FY19 • A consolidated trading loss improvement of 19% YoY further fuelled growth. Headline earnings from continuing operatio
Slide 38: Tencent’s contribution to core headline earnings
38 Tencent’s contribution to core headline earnings FY18 FY19 Tencent Tencent Naspers’ share Naspers’ share December 17 December 18 (US$m) (US$m) (RMBm)1 (RMBm)1 Tencent profit attributable to equity holders 71 510 3 616 78 719 3 6552 Adjustments to core: (6 360) (328) (1 203) (68) - Impairment of i
Slide 39: Strong balance sheet provides flexibility to pursue growth ambitions
39 Strong balance sheet provides flexibility to pursue growth ambitions • The group had a strong net cash position of US$6.3bn, attributable to US$m FY18 FY19 proceeds retained from the sale of Debt1: (3 216) (3 247) Flipkart and the disposal of Tencent shares in FY18. Cash1,2: 11 368 9 575 • MultiC
Slide 40: Debt maturity profile and debt position
40 Debt maturity profile and debt position Debt Debt maturity profile (US$m) • US$1bn 7yr bond issued July 2013 (6% coupon). • US$1.2bn 10yr bond issued July 2015 (5.5% coupon). • US$1bn 10yr bond issued July 2017 Group RCF (4.85% coupon). US$2 500m Revolving credit facility (RCF) Bond Bond Bond • T
Slide 41: Current assets and liabilities
41 Current assets and liabilities • The video-entertainment business was Current assets (US$m) FY18 FY19 Current liabilities (US$m) FY18 FY19 unbundled to shareholders during the year. Inventory 231 209 Current portion of long-term debt 280 23 • Cash and short-term cash investments relate largely to
Slide 42: Capital expenditure
42 Capital expenditure Split by business1 • The increase in capital expenditure US$m FY18 FY19 relates mainly to increased warehouse capacity for eMAG and Takealot and new headquarters for iFood. Capex from continuing operations 76 113 • Maintenance capex expected to change as the business evolves.
Slide 43: Appendix
APPENDIX NASPERS
Slide 44: Group portfolio
44 Group portfolio Global platform operator International internet assets Local SA assets Social & 96% internet Classifieds B2C Payments & Naspers Ventures platforms 85% Fintech 100%1 80% Food delivery Ventures 31% 99% 100% 43%3 81% 25% 28% 23% 100% 54%4 12% 21% 80%2 22% 21% 19% 36% 39% 34% 99% 12%
Slide 45: Glossary of terms
45 Glossary of terms — JSE: Johannesburg Stock Exchange — ARPU: Average revenue per user — M&A: Mergers and acquisitions — ARPIU: Average revenue per internet user — MCG: MultiChoice Group — CAGR: Cumulative annual growth rate — MAU: Monthly active user — CTx: Convenient transactions — MUL: Monthly
Slide 46: Contact us
46 Contact us Eoin Ryan (Head of Investor Relations) InvestorRelations@naspers.com www.naspers.com +1-347-210-4305