Liquidity Services, Inc. · NASDAQ:LQDT
Liquidity Services — Q2 FY2007 Earnings Presentation
18 slides from Liquidity Services's earnings presentation, May 2, 2007
Slide 1: Liquidity Services Q2 FY07 Earnings Call
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Slide 2: Safe-Harbor Statement
Safe-Harbor Statement 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.
Slide 3: Bill Angrick, Chief Executive Officer
Bill Angrick Chief Executive Officer
Slide 4: Diversification and Growth
Diversification and Growth GMV Mix D.O.D. Surplus 52.2% D.O.D. Scrap 19.3% 25% International 3.5% Commercial 47.6% D.O.D. Surplus 25.5% D.O.D. Scrap 22.9% International 4.0% Q2 ‘06 Q2 ‘07 Commercial Business is LSI’s Largest and Fastest Growing Segment
Slide 5: Strong Commercial Seller Relationships
Strong Commercial Seller Relationships Commercial Sellers Key Growth Drivers Big Box Retailers Leading E-Tailers Department Store Chains Service Companies Distributors and VARs Manufacturers and OEMs LSI’s Serves a Growing Pipeline of Major Commercial Sellers Upside sharing/aligned interests Data tr
Slide 6: The LSI Network Effect
The LSI Network Effect LSI Delivers Significant Value to Buyers and Sellers Creating a Network Effect New & Expanded Seller Relationships Broader Product & Service Offering Increased Buyer Demand Network Effect Increased Rate of Return Effect Network
Slide 7: Commercial Business Growth
Commercial Business Growth- Last 18 months $7.9M $11.0M $12.8M Commercial Gross Merchandise Volume 261% Growth $11.7M $20.1M $28.5M 29% Average Sequential Quarterly Growth FY 2006 FY 2007 Six consecutive quarters of 100%+ YOY growth Q1 Q2 Q3 Q4 Q1 Q2
Slide 8: Scrap Business Growth
Scrap Business Growth – Last 18 Months $7.0M $8.5M $9.9M 14.5% Avg. Sequential Quarterly Growth $13.8M $12.5M $13.7M 96% Growth FY 2006 FY 2007 Scrap Gross Merchandise Volume Q1 Q2 Q3 Q4 Q1 Q2
Slide 9: Healthy and Liquid Buyer Marketplace
Healthy and Liquid Buyer Marketplace 4.8 5.4 5.2 Average Auction Participants Per Completed Transaction 5.1 5.0 5.5 FY 2006 FY 2007 3.0 Internal Goal Q1 Q2 Q3 Q4 Q1 Q2
Slide 10: Commercial Business Auction Highlights
Customer Returns – 17 Exercise Monitors Unique Bidders: 7 Winning Bid: $1,157/ $68.06 each ~ 32% MSRP Commercial Business Auction Highlights Shelf Pulls – 81 Pairs Designer Shoes Unique Bidders : 6 Winning Bid: $2,250/ $27.79 each 27% MSRP Customer Returns – 14 Portable Gaming Systems Unique Bidders
Slide 11: DOD Business Auction Highlights
Pentium III & IV CPUs - 6 month term contract Unique Bidders: 12 Winning Bid: $545,050/ $46.15 each Scrap Metal – Inconel 130,000 lbs Unique Bidders: 14 Winning Bid: $1,482,700.00/ $11.40 per lbs DOD Business Auction Highlights Medical Equipment – 5 Dental Chairs Unique Bidders: 9 Winning Bid: $18,7
Slide 12: Jim Rallo, Chief Financial Officer
Jim Rallo Chief Financial Officer
Slide 13: Financial Highlights
Financial Highlights $49M $72M $89M Gross Merchandise Volume FY Ended 9/30 $44M $61M $76M $89M Revenue Profit Sharing Model Consignment Model Buyer Premium Fees Pay-Per-Click Fees 37% CAGR 35% CAGR $173M $102M FY Ended 9/30 $148M $44M $60M 37% $37M $49M 3 Mos Ended 3/31 $81M $113M 6 Mos Ended 3/31 4
Slide 14: Accelerating Profitability: Adjusted EBITDA
Accelerating Profitability (1) Adjusted EBITDA shown for fiscal years 2002 - 2006 and the interim periods includes adjustments for stock-based compensation and a portion of certain acquisition payments. For the fiscal years ended September 30, 2002, 2003, 2004, 2005 and 2006, Net Income was $1.3M, $
Slide 15: Accelerating Profitability: Adjusted Net Income
Accelerating Profitability Adjusted Net Income (2) (2) Adjusted Net Income shown for fiscal years 2002 - 2006 and the interim periods includes adjustments for stock-based compensation and a portion of certain acquisition payments. For the fiscal years ended September 30, 2002, 2003, 2004, 2005 and 2
Slide 16: Key Operating Metrics
Key Operating Metrics Completed Transactions 95K Total Registered Buyers 69K 150K 386K 524K 264K 66% CAGR FY Ended 9/30 Total Auction Participants 993K FY Ended 9/30 404K 552K 671K 848K 21% CAGR 92K 123K 141K 173K 613K 459K 3 Mos Ended 3/31 101K 194K 6 Mos Ended 3/31 6 Mos Ended 3/31 25% CAGR 486K 5
Slide 17: Strong Balance Sheet
Strong Balance Sheet As of March 31, 2007 In Thousands Cash, cash equivalents and short- term investments $60,186 Working capital 53,500 102,194 Total assets Total stockholders’ equity 74,095 28,099 Total liabilities
Slide 18: Reconciliation of Financial Data
Reconciliation of Financial Data In Thousands 2002 2003 2004 2005 2006 2006 2007 2006 2007 Net Income $1,324 $2,776 $5,269 $4,122 $7,981 $3,396 $4,787 $1,928 $2,474 Interest (income) expense and other income, net 169 391 621 570 (431) 574 (1,149) 211 (551) Provision for income taxes - 351 541 1,166