Vend Marketplaces Asa · OSL:VEND
Vend Marketplaces Asa — Schibsted — Q3 2018 Earnings Presentation
45 slides from Vend Marketplaces Asa's earnings presentation, Oct 26, 2018
Slide 1: Q3 2018
Q3 2018 CEO Rolv Erik Ryssdal and CFO Trond Berger 26 October 2018
Slide 2: Disclaimer
Disclaimer This presentation (hereinafter referred to as the "presentation") has been prepared by Schibsted ASA ("Schibsted" or the "Company") exclusively for information purposes, and does not constitute an offer to sell or the solicitation of an offer to buy any financial instruments. Reasonable c
Slide 3: Agenda
AGENDA • Q3 Highlights • Marketplaces • Publishing • Growth • Update on MPI demerger • Finance Q3 2018 3
Slide 4: Steady revenue growth and record high EBITDA margin of 20%
Steady revenue growth and record high EBITDA margin of 20% • Marketplaces: Revenue growth driven by verticals, and increased profits • France, Spain, Norway and Brazil all showing strong development in Q3; soft quarter in Sweden • Refocused ambitions for Shpock - investment phase losses are declinin
Slide 5: Marketplaces
MARKETPLACES Q3 2018 5
Slide 6: We continue to grow revenue and increase our operating margin
Marketplaces We continue to grow revenue and increase our operating margin Schibsted Marketplaces Strong revenue growth in key markets Revenue and EBITDA margin* Share of total revenue, Y/Y revenue growth rates in brackets* 2,500 +13%* Sweden (-5%) 2,214 Norway (+11%) 2,000 1,957 1,629 Spain (+17%)
Slide 7: Verticals are the key revenue drivers
Marketplaces Verticals are the key revenue drivers Revenue growth driven by verticals…. … of which real estate and cars are most important +13%1 Other Jobs Display advertising +4% 24% Generalist +13% Real estate 38% Verticals2 +17% Cars 38% Q3 16 Q3 17 Q3 18 1) Pro forma, including contribution from
Slide 8: In France, continued growth in revenues and traffic – EBITDA margin 58%
Marketplaces In France, we saw continued growth in revenues and traffic – EBITDA margin 58% for Leboncoin.fr isolated France1 Revenues (NOK million) and EBITDA margin • Fast growing revenues in verticals 800 17%* • Price optimization supported by product 700 enhancements in cars and real estate 600
Slide 9: In Norway, strong growth was driven by volumes and new products
Marketplaces In Norway, strong growth was driven by volumes and new products Norway Revenues (NOK million) and EBITDA margin • Strong revenue growth in jobs and real estate 500 +11% verticals 450 400 • Volume increase and price optimization supported 350 by product enhancements in jobs, real estate
Slide 10: In Spain, solid performance in jobs and cars – acceleration in real estate
Marketplaces In Spain, we saw solid performance in jobs and cars – acceleration in real estate Spain Revenues (NOK million) and EBITDA margin +17%* • Continued good revenue growth driven by 400 professional revenues in jobs and cars in Q3 350 • Strong quarter in Cars, also supported by extra 300 inv
Slide 11: In Sweden, we saw revenue decline in display advertising
Marketplaces In Sweden, we saw revenue decline in display advertising Sweden Revenues (NOK million) and EBITDA margin* • Jobs continue with solid growth 300 -5%* • Slight revenue contraction in cars 250 • Strong KPI development in cars compared to 200 competitors • 72 percent of dealerships that lef
Slide 12: Increasing revenue and reducing investment phase losses
Marketplaces We are continuing to increase revenue and reduce investment phase losses Total Investment phase revenue Total Investment phase EBITDA (EUR million including our (EUR million including our proportionate proportionate share of JVs) share of JVs) • Solid revenue growth in +26%* verticals i
Slide 13: Strong revenue growth, limited cost increase in Brazil
Marketplaces Strong revenue growth, limited cost increase in Brazil We have grown revenue by 63% through verticals and display • Strong revenue growth driven Million BRL (100%). Schibsted owns 50% by cars and real estate +63% • Increased ARPU in the verticals 71.1 • Financing partnership on cars 43.
Slide 14: Refocused strategy in Shpock, moving towards break-even during 2019
Refocused strategy in Shpock, moving towards break-even during 2019 • Moving towards a break-even during 2019 • Strong market position established in the UK and selected other markets • More than 50 million downloads • More than 10 million active users per month • More than 2 billion page impression
Slide 15: Publishing
PUBLISHING ry a E} SCHIBSTED
Slide 16: While digital is growing, we are managing the decline in print
Publishing While digital is growing, we are managing the decline in print Publishing operations Scandinavia Revenues and EBITDA-margin (NOK million) -1% 2,000 1,500 1,000 500 9% 11% 10% 0 Q3 16 Q3 17 Q3 18 Offline revenues EBITDA margin Online revenues Q3 2018 16
Slide 17: VG delivered digital growth and solid margins; soft Aftonbladet
Publishing VG delivered digital growth and solid margins. Soft development in Aftonbladet VG and Aftonbladet Strong growth in digital subscriptions in VG Revenues and EBITDA-margin (NOK million) Subscribers to VG+ 900 -3%* 160,900 800 +26% 700 127,500 600 500 400 300 200 15% 17% 14% 100 0 Q3 17 Q3 1
Slide 18: In morning newspapers, we have grown digital subscriber numbers
Publishing In morning newspapers, we have grown digital subscriber numbers Subscription based newspapers Revenues (NOK million) and EBITDA margin Number of subscribers 900 600,000 +9% -1% 800 500,000 700 600 400,000 500 300,000 400 300 200,000 +43% 200 9% 100,000 100 5% 7% 0 0 Q3 16 Q3 17 Q3 18 Q3 1
Slide 19: Setting the stage with powerful journalism
Publishing Setting the stage with powerful journalism 3 brothers declared mentally Close coverage of the Norwegian and Swedish parliament representatives disabled – without being informed Swedish elections claiming unjustified reimbursements of expenses Q3 2018 19
Slide 20: Schibsted Growth
SCHIBSTED GROWTH Q3 2018 20
Slide 21: Lendo – continued growth; investment in marketing
Schibsted Growth Lendo – continued growth; investment in marketing Lendo Revenues (NOK million) and EBITDA margin • Continued revenue growth driven by increased 250 number of applications +15%* • Slowdown in the market 200 due to regulatory initiatives particularly in Norway 150 • Reduced margins du
Slide 22: Demerger of International Marketplaces
DEMERGER OF INTERNATIONAL MARKETPLACES Q3 2018 22
Slide 23: Maximize value creation through demerger of international classifieds (MPI)
We are aiming to maximize value creation through the demerger of international classifieds (MPI) Strategic change allowing two new companies maximise value creation for shareholders, society, customers, users and partners MPI: Schibsted: A fast-growing global leader in online Nordic digital growth c
Slide 24: Two strong, separately listed companies with distinct strategies
We form two strong, separately listed companies, which will optimize value creation based on distinct strategies Schibsted MPI (preliminary name) • A leading Nordic digital growth company • A pure play global leader in online classifieds • Strong growth drivers in online classifieds and personal fin
Slide 25: MPI to be listed on Oslo Stock Exchange – targeting April 2019
International marketplaces (MPI) will be listed on Oslo Stock Exchange – targeting April 2019 • Oslo Stock Exchange chosen as listing venue for MPI • Interim Board with international profile and • Well functioning market deep online classifieds industry insights is established • Strong shareholder b
Slide 26: Finance
, = S| SCHIBSTED Q3 2018
Slide 27: Strong EBITDA in Q3 – margin increase from 19% to 20%
Finance Strong EBITDA in Q3 – margin increase from 19% to 20% Y/Y EBITDA change Q3 17-Q3 18 (NOK million) 865 33 -32 30 28 -24 23 -15 783 39 EBITDA MP France MP Norway MP Sweden MP Spain MP Investment Publishing Growth Other/HQ incl. EBITDA Q3 2017 phase and product & tech Q3 2018 Other Q3 2018 27
Slide 28: Improved EBITDA, increased operating cash flow, reduced CAPEX
Finance We have improved our EBITDA, increased our operating cash flow, and reduced our CAPEX EBITDA Operating cash flow CAPEX NOK million NOK million NOK million 2,371 1,451 620 551 -11% 1,911 +24% +52% 954 Jan-Sep 17 Jan-Sep 18 Jan-Sep 17 Jan-Sep 18 Jan-Sep 17 Jan-Sep 18 Q3 2018 28
Slide 29: Q3 income statement Schibsted Group
Finance Q3 income statement Schibsted Group Third quarter (NOK million) 2018 2017 Operating revenues 4,358 4,161 Operating expenses (3,493) (3,378) Gross operating profit (EBITDA) ex Investment phase 972 903 Gross operating profit (EBITDA) 865 783 Depreciation and amortization (181) (158) Negative i
Slide 30: Underlying tax rate stable below 30%
Finance Underlying tax rate stable below 30% ■ Reported tax rate may deviate significantly from the nominal tax rates in our markets. ■ The main reason is unrecognised tax benefits from tax losses in Schibsted Marketplaces Investment phase operations and product & tech development ■ The reported tax
Slide 31: We plan to reduce investments, while growing revenue
Finance We plan to reduce investments, while growing revenue UN- 15-20 percent Online classifieds revenue growth next 3-5 years target maintained; CHANGED focus on cash flow and profitability improvement in 2018 and beyond RANGE Online classifieds investment phase: NARROWED Losses reduced to EUR 40-
Slide 32: Q&A
Q&A Q3 2018 32
Slide 33: Q3 2018 – Continuing our steady growth
Q3 2018 – Continuing our steady growth • Marketplaces: Revenue growth driven by verticals, and increased profits • France, Spain, Norway and Brazil all showing strong development in Q3, soft quarter in Sweden • Refocused ambitions for Shpock announced - investment phase losses are declining • Publis
Slide 34: Appendices
APPENDICES Spreadsheet containing detailed Q3 2018 and Historical and analytical Information can be downloaded from www.schibsted.com/ir Q3 2018
Slide 35: We continue to deliver profit improvement
We continue to deliver profit improvement Marketplaces Publishing Schibsted Growth excl. Hitta.se (divested Q3 2017) 2,096 1,949 1,978 1,953 Revenue EBITDA -1% 1,864 +12% 1,566 755 453 656 +15% 439 354 +3% 475 176 218 186 122 112 -15% 88 -8% Q3 16 Q3 17 Q3 18 Q3 16 Q3 17 Q3 18 Q3 16 Q3 17 Q3 18 35%
Slide 36: Continued revenue growth in Italy and Ireland, limited cost increase
Continued revenue growth in Italy and Ireland, limited cost increase Other Developed markets Revenues and EBITDA-margin (NOK million) +11% • Continued solid revenue growth in 183 165 verticals in all geographies 146 • Lower growth rate in display advertising • Improved EBITDA margin as a 44 result o
Slide 37: Targeting bolt-on acquisitions and consolidation in online classifieds
Finance We are targeting bolt-on acquisitions and consolidation in online classifieds – using our strong financial base Net interest bearing debt currently below target range M&A track record with strong results NIBD (NOK million) and NIBD/EBITDA Brazil 6.000 3.0 2017 Mexico 2015 Potential leverage
Slide 38: Key operations – Marketplaces; local currency
Key operations – Marketplaces; local currency Third quarter (NOK million) Year to date Year yoy % 2017 2018 Norway developed phase 2018 2017 2017 11% 409 456 Operating revenues 1,367 1,236 1,628 8% 218 236 Operating expenses 740 697 940 15% 191 220 EBITDA 627 539 688 47% 48% EBITDA-margin 46% 44% 42
Slide 39: Key operations – Publishing and Growth
Key operations – Publishing and Growth Publishing Growth Third quarter (NOK million) Year to date Year yoy % 2017 2018 VG (Verdens Gang) 2018 2017 2017 Third quarter (NOK million) Year to date Year 4% 428 443 Operating revenues 1,346 1,298 1,746 yoy % 2017 2018 GROWTH 2018 2017 2017 17% 203 238 - on
Slide 40: IFRS 15 and IFRS 16 impact
IFRS 15 and IFRS 16 impact IFRS 15 – New revenue recognition standard • Implemented in Schibsted as of Q1 2018 • Positive effect on revenue and EBITDA of around NOK 5 million in Q3 2018. Negative effect of NOK 25 million YTD. • Certain classifieds revenues being recognized over a longer period than
Slide 41: Key financial figures
Key financial figures Earnings per share - adjusted Net cash flow from operating activities NOK NOK million 2.00 800 1.76 1.74 1.75 700 633 1.45 604 1.50 600 550 566 505 1.25 1.04 500 0.93 0.96 1.00 0.88 400 335 335 0.72 0.75 300 0.44 200 192 0.50 200 159 0.25 0.15 100 0.00 0 Q2 16 Q3 16 Q4 16 Q1 17
Slide 42: Cash flow
Cash flow Third quarter (NOK million) 2018 2017 Profit (loss) before taxes 1,634 2,730 Depreciation, amortisation and impairment losses 658 470 Net effect pension liabilities (54) (77) Share of loss (profit) of joint ventures and associates, net of dividends received 15 102 Taxes paid (599) (678) Sa
Slide 43: Basic information
Basic information A-share B-share Ticker Oslo Stock Exchange: SCHA SCHB Reuters: SBSTA.OL SBSTB.OL Bloomberg: SCHA:NO SCHB:NO Number of shares 108,003,615 130,684,373 Treasury shares (22 October 2018) 256,227 29,973 Number of shares outstanding 107,747,388 130,654,400 Free float* 74% 78% *) Total nu
Slide 44: Shareholder analysis
Shareholder analysis Shareholders SCHA SCHB % of % of foreign shareholders** 60.2 % 57.9 % Rank Name A-Shares B-shares Total vote Number of shareholders 3,977 4,242 1 Blommenholm Industrier AS 28,188,589 28,598,589 56,787,178 25.6 % Number of shares 108,003,615 130,684,373 2 Baillie Gifford & Co. 7,
Slide 45: Investor information
INVESTOR INFORMATION Visit Schibsted’s web site www.schibsted.com IR contacts: Jo Christian Steigedal VP, Head of IR jcs@schibsted.no +47 415 08 733 Schibsted ASA Akersgata 55, P.O. Box 490 Sentrum, NO- 0105 Oslo Tel: +47 23 10 66 00. E-mail: schibsted@schibsted.no Q3 2018 45