Liquidity Services, Inc. · NASDAQ:LQDT
Liquidity Services — Q3 FY2020 Earnings Presentation
22 slides from Liquidity Services's earnings presentation, August 2020
Slide 1: Investor Presentation Third Quarter Fiscal Year 2020
Investor Presentation Third Quarter Fiscal Year 2020 ©Liquidity Services, Inc. All Rights Reserved. 1
Slide 2: Forward-Looking Information
Forward-Looking Information This document contains forward-looking statements. These statements are only predictions. The outcome of the events described in these forward-looking statements is subject to known and unknown risks, uncertainties and other factors that may cause our actual results, leve
Slide 3: Who We Are
Liquidity Services is a global solution provider in Who We Are the reverse supply chain continuously building the world’s largest marketplace for business surplus Manage, value, and sell Maximize return with Optimize and execute We… surplus across the broadest buyer base, in surplus management globe
Slide 4: Global Solutions with the Largest Marketplace Platform for the Reverse Supply Chain
Global Solutions with the Largest Marketplace Platform for the Reverse Supply Chain CLOTHING & JEWELRY & CONSUMER COMPUTERS & HOUSEWARES GENERAL TOOLS & MOBILE ACCESSORIES WATCHES ELECTRONICS NETWORKING & LIGHTING MERCHANDISE MACHINERY DEVICES ©Liquidity Services, Inc. All Rights Reserved. 4
Slide 5: Our Purpose: Sellers, Buyers, Planet
OUR PURPOSE: To intelligently capture the enduring value of surplus, benefiting our sellers, our buyers, and our planet. SELLERS 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 Sellers
Delivering Maximum Value to Sellers SERVING THE BROADEST BASE OF INDUSTRIES Aerospace Consumer Brands Fast-Moving Mining & Large & Defense & OEMs Consumer Goods Construction Automotive Electronics Government Retail Manufacturing Manufacturing Industrial Transportation Biopharmaceuticals Energy Manuf
Slide 7: Providing Superior Buyer Experiences
Providing Superior Buyer Experiences BUYERS WE SERVE Online/Offline Retailers Resellers Distributors Refurbishers Wholesalers Small Businesses Flea Markets Recyclers Superior Product Quality and Information OUR VALUE Large volumes and recurring flows of products; refurbishment services PROPOSITION to
Slide 8: Market Opportunity
Market Opportunity * $50 Billion* $3 Billion Retailers & OEMs U.S Public Sector (Source: Appriss Retail 2018) (Source: Company Data) $8 Billion $20 Billion $48 Billion Energy Industrial Capital Assets Transportation (Source: Manfredi & Associates 2015, ACT (Source: Company Data) (Source: Company Dat
Slide 9: Macro-Trends Expanding Our Opportunity
Macro-Trends Expanding Our Opportunity e-Commerce Growth Technology Innovation • Increased demand for digital, no-contact • Product obsolescence and shorter product solutions driving more opportunities with lifecycles sellers and buyers • Greater focus on compliance & transparency • Online growth in
Slide 10: Our Business Model
Our Business Model Compelling Model ▪ Online, no-contact and self-service solutions ▪ Diversified products, services, and customer mix globally ▪ High-volume recurring revenue ▪ Value-added managed services ▪ Additional services beyond selling assets to create higher-margin revenue streams ▪ Network
Slide 11: GovDeals Segment Delivers Consistent Growth
GovDeals Segment Delivers Consistent Growth Over 14,000 government agencies have used our self-service model for low-cost, highly effective surplus sales GovDeals Segment GMV Trendline • GovDeals self-directed model is attractive to: – State and municipal governments – Higher education institutions
Slide 12: RSCG Segment is Driving Long-Term Growth
RSCG Segment is Driving Long-Term Growth RSCG delivers 15 consecutive quarters of GMV growth • Q2 and Q3FY20 impacted by global pandemic RSCG Segment GMV Trendline with lower volumes and mixed buyer activity in late March through early May $44.3 $45.0 • We expanded service offerings to address full-
Slide 13: CAG Segment Diversified Seller Base
CAG Segment Diversified Seller Base Seeking to transition key sellers to a new self-directed solution CAG Segment GMV Trendline • Q2 and Q3FY20 were impacted by global pandemic: – APAC had lower seller and buyer activity in January and February $42.3 – EMEA and North American impact started in March
Slide 14: Machinio Overview
Machinio Overview • Machinio aggregates > 1million global used equipment listings worth $23+ billion and generating 10M+ site visits and 600k qualified seller leads annually • Subscription model, 1-year term, paid upfront, 85%+ recurring with ~3,000 subscribers • Recently launched MachineryHost pro
Slide 15: Machinio Value Proposition and Rationale
Machinio Value Proposition and Rationale ✓ Entry into new verticals ✓ Expands Liquidity Services buyer base ✓ Complementary solution for equipment sellers ✓ Rich source of data on equipment, buyers and sellers ✓ Cross selling opportunities ©Liquidity Services, Inc. All Rights Reserved. 15
Slide 16: Financial Results
Financial Results ©Liquidity Services, Inc. All Rights Reserved. 16
Slide 17: Q3FY20 Consolidated Results
Q3FY20 Consolidated Results $ millions Gross Total Adjusted Merchandise Gross Profit Revenue EBITDA Volume 3.7 626640 113 225 227 110 482 0.0 0.2 168 84 423 77 150 -0.5 -1.2 168 57 29 130 48 25 -7.3 18 19 19 20 19 20 18 19 19 20 19 20 18 19 19 20 19 20 Fiscal Year Nine Three Nine Three Fiscal Year N
Slide 18: Diversification By Pricing Model
Diversification By Pricing Model GMV Mix By Pricing Model Purchase Purchase 22% 22% Consignment 78% Consignment 78% Purchase Consignment Self-Directed Consignment Purchase Consignment Self-Directed Q3 FY19 Q3 FY20 ©Liquidity Services, Inc. All Rights Reserved. 18
Slide 19: Diversification By Segment: GMV Mix
Diversification By Segment GMV Mix by Segment RSCG 24% RSCG 35% GovDeals GovDeals 54% 44% CAG 22% CAG 21% Q3 FY19 Q3 FY20 ©Liquidity Services, Inc. All Rights Reserved. 19
Slide 20: Diversification By Segment: Revenue Mix
Diversification By Segment Revenue Mix by Segment Machinio 3% Machinio GovDeals GovDeals 4% 13% 16% CAG RSCG RSCG 13% 55% 70% CAG 26% Q3 FY19 Q3 FY20 ©Liquidity Services, Inc. All Rights Reserved. 20
Slide 21: Reconciliation of Financial Data Adjusted EBITDA Reconciliation
Reconciliation of Financial Data Adjusted EBITDA Reconciliation In Thousands Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Net Income (Loss) ($3,705) ($1,043) ($5,022) ($4,362) ($4,649) ($5,224) ($5,196) ($4,238) $213 Interest & other expense (income), net (47) 326 (233) (376) (368)
Slide 22: Investor Relations
Investor Relations Julie Davis, Senior Director 202.558.6234 [email protected] ©Liquidity Services, Inc. All Rights Reserved. 22