Inchcape Plc · LSE:INCH
Inchcape — Investor Day (June 2022)
37 slides from Inchcape's investor day presentation, Jun 30, 2022
Slide 1: In the Driving Seat: Spotlight on Americas
IN THE DRIVING SEAT: SPOTLIGHT ON AMERICAS 30 June 2022
Slide 2: Accelerate strategic framework
Inchcape 2 Accelerate strategic framework Our Growth Drivers Distribution Excellence Vehicle Lifecycle Services Our Enablers Culture and Digital, Data & Efficient Scale Capabilities Analytics Operations Responsible Business
Slide 3: Considerable opportunities for an ambitious Inchcape
Inchcape 3 Considerable opportunities for an ambitious Inchcape Distribution Excellence Vehicle Lifecycle Services Annual new car volumes (units) Vehicle lifecycle value profit split2 90m 17m New market opportunities Large markets; e.g. China, typically US, UK, 75% Currently insourced Brazil, unders
Slide 4: Americas' distribution growth opportunities
Inchcape 4 Americas’ distribution growth opportunities Typical distribution markets1 17m 1.8m New market ▪ Not currently present in 15 markets Americas opportunities 2 e.g. Puerto Rico, Bolivia, Paraguay APAC Inchcape ▪ Currently distribute in 11 markets markets 1 Americas ▪ Opportunity to grow furt
Slide 5: Inchcape Americas in context of the Inchcape Group
Inchcape 5 Inchcape Americas in context of the Inchcape Group Revenue1 o/w Americas 16% of Group revenue Shifting into more attractive segments: Distribution focus ▪ Significantly changed the £1.2bn shape of the Group 2% £0.8bn £0.9bn £0.7bn ▪ Greater exposure to segment £0.5bn £0.2bn with higher ma
Slide 6: Introducing Romeo: CEO of Americas & Africa
Inchcape 6 Introducing Romeo: CEO of Americas & Africa Romeo Lacerda ▪ 30+ years corporate experience spanning ▪ Digital: successfully developed and rolled-out Latin America, Europe and Middle East an eCommerce channel across Europe ▪ Industry background: consumer goods ▪ Data: established strong re
Slide 7: Romeo Lacerda, CEO Americas & Africa
ROMEO LACERDA CEO AMERICAS & AFRICA
Slide 8: Inchcape Americas at a glance
Inchcape 8 Inchcape Americas at a glance Existing portfolio: key facts1 Headquarters: Santiago, Chile ~3k 11 25 colleagues markets OEM brands Oldest distribution contract: ~£1.2bn >40k 272 1923 revenue new vehicles locations; Mack in distributed ~25% operated Colombia by Inchcape2 2021 brand and mar
Slide 9: We have a diverse team, with broad expertise
Inchcape 9 We have a diverse team, with broad expertise Americas Executive Team Esteban Garcia Karen Blanco Ivan Abud Rodrigo Schmidt Ileana Rojas Marcos Astudillo Finance Director HR Director Operational Legal Director IS Director Digital & Customer Excellence Director Experience Director 2 2 H 3 3
Slide 10: Inchcape Americas has grown significantly since 2016
Inchcape 10 Inchcape Americas has grown significantly since 2016 Revenue 2016 20211 £160m £1.2bn Revenue Profit ~40% CAGR2 ~50% CAGR2 + 23 OEM brands + 9 Markets Chile Colombia Argentina Costa Rica Panama Ecuador Peru Uruguay El Salvador Guatemala Barbados+ 1: 2021 revenue pro-forma for acquisitions
Slide 11: The Americas has significant growth potential
Inchcape 11 The Americas has significant growth potential Inchcape markets Inchcape markets Developed Americas worldwide markets1 ▪ Attractive (short and) medium-term GDP growth Population prospects (total) 206m 911m - GDP/capita $10k $23k $50k ▪ Our markets across Americas (average) (from $4k to $1
Slide 12: Drivers of topline growth
Inchcape 12 Drivers of topline growth M&A Consolidation Outperformance ▪ Expand OEM relationships Market share gains Volume ▪ Broaden market footprint ▪ Omni-channel (DXP) Market TIV1 ▪ Analytics platform (DAP) ▪ Exposure to higher ▪ Finance & Insurance growth markets, with rising rates of motorisat
Slide 13: Organic drivers
@ Inchcape ORGANIC DRIVERS
Slide 14: The Americas has exciting growth prospects
Inchcape 14 The Americas has exciting growth prospects Naturally higher growth markets Huge upside to today’s volumes 10 year avg. 10 year peak Developed markets2 700 vs 2021 TIV vs 2021 TIV Inchcape markets 446 +69% worldwide +28% +43% Inchcape >2x +13% +15% +24% markets 193 Americas >3x Inchcape I
Slide 15: Digital & Data: harnessing our differentiation
Inchcape 15 Digital & Data: harnessing our differentiation Digital Experience Platform Data Analytics Platform Inchcape Latam vs Other distributors1 Parts pricing optimisation Online Online User shopping service experience Objective: ensure parts pricing reflects optimum value 1.9x 2.4x 1.8x Solutio
Slide 16: Finance Insurance Products: further expansion ahead
Inchcape 16 Finance Insurance Products: further expansion ahead FIP: driving greater customer loyalty and retention An Americas success story Current priorities Improves vehicle Chile: partnership with FORUM ▪ Develop partnerships purchase accessibility with local financiers in other markets >3x inc
Slide 17: Aftermarket: a broader focus has supported our success
Inchcape 17 Aftermarket: a broader focus has supported our success Inchcape’s acquisition in 2018 Building global leadership catalysed aftermarket improvement in aftermarket services ▪ Insourced Parts call centre: greater conquest of new leads ▪ Dedicated bodyshop facility opened to other brands: de
Slide 18: Vehicle Lifecycle Services: unlocking untapped potential
Inchcape 18 Vehicle Lifecycle Services: unlocking untapped potential Gross profit split Distribution segment Americas Initial Americas launch: Colombia in 2H22 meaningful upside ▪ >1m used cars sold per annum ▪ Highly fragmented market ▪ Low-cost leads via listing platforms New Aftermarket Used Aim:
Slide 19: Consolidation & Expansion
@ Inchcape CONSOLIDATION & EXPANSION
Slide 20: Added several new OEMs and markets in the Americas
Inchcape 20 Added several new OEMs and markets in the Americas New markets Existing markets Strategic move to enter Leveraging existing market a new geography and regional infrastructure 2010-2015 - - 2016 Chile, Colombia, Peru & Argentina Subaru, Hino 2018 Costa Rica & Panama Suzuki 2019 Ecua
Slide 21: Consolidating a highly fragmented market
Inchcape 21 Consolidating a highly fragmented market Americas opportunity: typical distribution markets1 1.8m ▪ OEMs focused on the ▪ >300 independent very largest markets OEM NSC conversions distributors operated ▪ OEMs allocating capital (NSCs2) ▪ Mostly small, multi- to address CASE trends genera
Slide 22: The leading distributor by some distance
Inchcape 22 The leading distributor by some distance Market presence and brand partners of top 50 distributors in Americas # Brands 13 26 12 25 Inchcape Benefits of regional scale: 11 10 2 ▪ Leverage investment in 9 technology (i.e. digital & data) 8 7 ▪ Knowledge generation and 6 sharing of best pr
Slide 23: Mercedes-Benz: a strong start to our relationship
Inchcape 23 Mercedes-Benz: a strong start to our relationship Our expanding Leveraging our distribution Mercedes-Benz footprint capabilities in Colombia ▪ Greater focus on finance Uruguay El Salvador products: broadened our partners, increasing financing penetration Ecuador Colombia Guatemala Barbad
Slide 24: Ditec: entering the next phase of its growth journey
Inchcape 24 Ditec: entering the next phase of its growth journey ▪ First-time distribution relationships Inchcape’s leadership with Porsche and Volvo in digital and data will ▪ Jaguar Land Rover: broadening help propel the business our market footprint into the new age of ▪ Opportunity to deploy lea
Slide 25: Geely: substantial improvement post our contract-win
Inchcape 25 Geely: substantial improvement post our contract-win 2021: signed a global strategic partnership1 Driving Geely new car volumes in Chile to a record level Leading brand in China >1.3m vehicles sold in 2021 Parent company owns 2016 2017 2018 2019 2020 2021 2022 YTD Volvo, Lotus & LEVC Dis
Slide 26: BMW: expanding our footprint and improving performance
Inchcape 26 BMW: expanding our footprint and improving performance 2020: awarded Mini1 and Motorrad2 contracts Inchcape appointed Market share gain Market share loss Peru Chile 2018 2019 2020 2021 2018 2019 2020 2021 ▪ BMW Group: consolidated ▪ BMW: distributing in Chile ▪ BMW Motorrad: long-term ▪
Slide 27: Chile: the playbook for distribution expansion
Inchcape 27 Chile: the playbook for distribution expansion Expanding our distribution footprint Financial performance since 20161 Chile Revenue Profit ~3x >>5x 1993 1996 2016 2020 2021 2022 ▪ Added several OEM brands since 2016 ▪ Indumotora (2016) a catalyst for our Americas expansion ▪ Overhead sav
Slide 28: Expanding our brand presence optimises performance
Inchcape 28 Expanding our brand presence optimises performance Typical brand structure in a market Passenger vehicles Luxury brands Our intra-market brand strategy Premium brands ▪ We target non-competing Niche brands OEMs across the brand pyramid Commercial vehicles ▪ Both passenger vehicles and co
Slide 29: A proven track record of successful integration
Inchcape 29 A proven track record of successful integration 2016 2018 2020 Revenue Revenue Revenue +£400m +£200m +£100m ▪ Combined with our existing ▪ Invested in a best-in-class ▪ Created a Mercedes-Benz business and consolidated aftersales centre centre of excellence to back-office, driving saving
Slide 30: Accelerate strategy: Responsible Business plan
Inchcape 30 Accelerate strategy: Responsible Business plan Planet People Places Practices ▪ Set carbon ▪ Created an I&D ▪ Safe driving ▪ Re-written and reduction initiatives dashboard awareness training centralised policies ▪ Recycling practices in ▪ Launched online ▪ Initiative launched ▪ Created g
Slide 31: Summary
@ Inchcape SUMMARY
Slide 32: Americas: an excellent track-record of performance
Inchcape 32 Americas: an excellent track-record of performance Inchcape Americas has grown significantly since 2016 A strong business with an excellent track record of... ▪ …improving business performance: profit grown faster ~50% than revenue ~40% ▪ …managing volatility: be that inflation, politica
Slide 33: Excited about the growth prospects of our business
Inchcape 33 Excited about the growth prospects of our business The Americas is a large Our digital and data A plug-and-play global and attractive region with investments sets us apart distribution platform; helping compelling characteristics from our competition drive expansion for OEM partners acro
Slide 34: Q&A
Q&A
Slide 35: Appendix
@ Inchcape APPENDIX
Slide 36: Inchcape Americas: OEM & market exposures
Inchcape 36 Inchcape Americas: OEM & market exposures Inchcape New wins pre-2016 Passenger vehicles Mercedes- BMW- Land BMW Subaru Suzuki DFSK Mini Jaguar Rolls Royce Geely Changan BYD Porsche Volvo Chrysler Jeep Benz Motorrad Rover Chile Colombia Peru Uruguay Ecuador El Salvador Guatemala Argentina
Slide 37: Inchcape Americas: OEM & market exposures
Inchcape 37 Inchcape Americas: OEM & market exposures Inchcape New wins pre-2016 Commercial vehicles Western Freightliner Hino Fuso JAC Doosan Mack Dieci Star Chile Colombia Peru Uruguay Ecuador El Salvador Guatemala Argentina Costa Rica Panama Barbados(+) +: indicates the base of the core distribut