Liquidity Services, Inc. · NASDAQ:LQDT
Liquidity Services — Q3 FY2015 Earnings Presentation
27 slides from Liquidity Services's earnings presentation, August 2015
Slide 1: Investor Presentation Third Quarter, Fiscal Year 2015
Investor Presentation Third Quarter, Fiscal Year 2015 August 2015 ©2015 Liquidity Services, Inc. All Rights Reserved. 1
Slide 2: Forward-Looking Information
Forward-Looking Information This presentation contains forward-looking statements. All forward-looking statements speak only as of the date of this presentation. Except as required by applicable law, we do not intend to publicly update or revise any forward-looking statements. These forward-looking
Slide 3: ©2015 Liquidity Services, Inc. All Rights Reserved.
©2015 Liquidity Services, Inc. All Rights Reserved. 3
Slide 4: ©2015 Liquidity Services, Inc. All Rights Reserved.
©2015 Liquidity Services, Inc. All Rights Reserved. 4
Slide 5: Our Purpose: Clients, Buyers, Planet
OUR PURPOSE: To intelligently capture the enduring value of surplus, benefiting our clients, our buyers, and our planet. CLIENTS BUYERS PLANET For enterprises with used, idle, For organizations and consumers For the planet’s natural resources, or excess assets and inventory: looking to achieve busin
Slide 6: Delivering Maximum Value to Clients
Delivering Maximum Value to Clients Better Service OUR VALUE Superior levels of industry and asset expertise, responsiveness, PROPOSITION intelligence, and analytics that achieve high-performance results aligned to your strategic goals TO CLIENTS Better Scale Complete solutions tailored to your indu
Slide 7: Services
Services Liquidity Services provides organizations in every major industry with consultative surplus asset management, valuation, and sales solutions. ©2015 Liquidity Services, Inc. All Rights Reserved. 7
Slide 8: Client Depth Across Industries
Client Depth Across Industries ©2015 Liquidity Services, Inc. All Rights Reserved. 8
Slide 9: Providing Superior Buyer Experiences
Providing Superior Buyer Experiences OUR VALUE Superior Product Quality and Information Large volumes and recurring flows of products; refurbishment services to PROPOSITION enhance and ensure product quality; ability to view detailed product TO BUYERS information, ask questions, and inspect items Fa
Slide 10: Your Global Partner
Your Global Partner With locations all over the world, Liquidity Services provides you with global coverage for your reverse supply chain. 53 locations 21 countries 6 continents ©2015 Liquidity Services, Inc. All Rights Reserved. 10
Slide 11: North American Reach
North American Reach With 13 warehouses and fulfillment centers totaling over two million square feet and five lots totaling over 110 acres, we can meet your storage and transportation needs across North America. Warehouses Groveport, OH Lockbourne, OH Oklahoma City, OK (2) Hayward, CA Fulfillment C
Slide 12: Market Opportunity
Market Opportunity $50 Billion $3 Billion Retailers & OEMs U.S Public Sector $8 Billion $20 Billion $48 Billion Energy Industrial Capital Assets Transportation $130 Billion Total Addressable Market Our Clients Across Industries ©2015 Liquidity Services, Inc. All Rights Reserved. 12
Slide 13: Growth Strategy
Growth Strategy Acquire Complementary Businesses Develop and Expand Vertical Enhance Features Market Segments and Services and Expertise Grow Buyer Increase Develop Base and Increase Penetration of New Seller Penetration Existing Sellers Relationships Consistent execution of growth strategy delivers
Slide 14: Current Initiatives
Current Initiatives ©2015 Liquidity Services, Inc. All Rights Reserved. 14
Slide 15: LiquidityOne Transformation Initiative
LiquidityOne Transformation Initiative The key modules are: LiquidityOne Transformation(LOT) is a transformation program that Customer Management Module (CMM): involves defining best practices management of buyer/client leads, contacts, and customer support across the company and building a modern t
Slide 16: Why LiquidityOne?
Why LiquidityOne? Enables singular, more powerful network Simplify and streamline operations by effect, provides our buyer base with enabling common playbooks and global access to all the property available across standard operating procedures all marketplaces, and provides a common account experien
Slide 17: Increased Efficiency Enables Growth
Increased Efficiency Enables Growth Self-service model to capture new segments of Enhanced the commercial AssetZone and market data analytics capabilities and business model Expanded RTV (CAG, RSCG) and refurbishment programs Tuck-in acquisitions to deepen and broaden our Organic growth industry by
Slide 18: Financial Results
Financial Results ©2015 Liquidity Services, Inc. All Rights Reserved. 18
Slide 19: Financial Highlights
Financial Highlights Compelling Business Model Strong Financial Position High Customer Value $96.2 million of Cash Multiple, Recurring Revenue Streams Debt Free Large Average Transaction Values Trailing 12 month Adj. EBITDA of $40.2 million Diversified Product and Customer Mix 51 Con
Slide 20: Strong Track Record of Growth
Strong Track Record of Growth* Multiple, Synergistic GMV 973 932 Revenue Streams 864 708 628 559 Consignment Model 430 360 356 Profit Sharing Model 234 246 173 194 Purchase Model Revenue Share Model 06 07 08 09 10 11 12 13 14 14 15 14 15 Service Revenue Fiscal Year ended 9 Months 3 Months
Slide 21: Diversification
Diversification GMV Mix Pricing Model Seller Base State & Local Purchase Gov’t 28.0% 28.3% Consignment Commercial 63.7% 53.4% DoD Surplus Profit Share 10.0% 8.3% DoD Scrap Q3’FY15 8.3% Q3’FY15 ©2015 Liquidity Services, Inc. All Rights Reserved. 21
Slide 22: Profitability: Adjusted EBITDA
Profitability Adjusted EBITDA(1) $110.0 $104.6 $63.0 $52.5 $54.0 $37.5 20.7% 12.7% $31.2 $26.2 $23.6 23.1% $20.4 15.6% $15.0 13.1% 14.3% $17.3 9.9% 10.0% 11.3% 10.3% $5.5 10.2% 9.8% 6.1 % 06 07 08 09 10 11 12 13 14 14 15 14 15 Fiscal Year ended 9 Months 3 Months 9/30 ended 6/30 ended 6/30 Note: Perc
Slide 23: Profitability: Adjusted Net Income & Adjusted EPS
Profitability Adjusted Net Income(2) & Adjusted EPS $1.80 The six months ended Q2 FY’15 benefitted from a reduction in the effective income tax rate from $1.60 Adjusted Net Income in Millions 40.0% to 24.8% as a result of a goodwill and $60.9 long-lived impairment following the termination of $57.0
Slide 24: Strong Operating Cash Flow
Strong Operating Cash Flow $52.1 $46.7 $39.9 $39.5 $31.9 $29.0 $17.7 $11.9 $10.6 $8.6 $4.5 $5.1 -$4.0 06 07 08 09 10 11 12 13 14 14 15 14 15 Fiscal Year ended 9 Months 3 Months 9/30 ended 6/30 ended 6/30 ©2015 Liquidity Services, Inc. All Rights Reserved. 24
Slide 25: Operating Model – Based on GMV
Operating Model – Based on GMV 9 mos FY 2009 FY 2010 FY 2011 FY2012 FY2013 FY2014 FY2015 Gross Merchandise Volume 100% 100% 100% 100% 100% 100% 100% Revenue 66.3% 66.7% 60.4% 55.0% 52.0% 53.2% 50.6% Cost of Goods Sold 24.3% 27.7% 24.3% 22.9% 20.5% 22.7% 21.1% Profit-Sharing Distributions 12.7% 10.0%
Slide 26: Reconciliation of Financial Data
Reconciliation of Financial Data In Thousands Year ended Septem ber 30, 9 m os ended June 30, 3 m os ended June 30, 2006 2007 2008 2009 2010 2011 2012 2013 2014 2014 2015 2014 2015 Net Income (Loss) $7,981 $11,019 $11,553 $5,719 $12,013 $8,512 $48,296 $41,104 $30,390 $31,097 ($61,120) $18,373 $1,615
Slide 27: Investor Relations
Investor Relations Julie Davis, Senior Director 202.558.6234 [email protected] ©2015 Liquidity Services, Inc. All Rights Reserved. 27