company presentation - Just

JUST EAT COMPANY PRESENTATION
MAY 2014
0
JUST EAT MISSION STATEMENT
We are a
SALES …
MARKETING …
OPERATIONS …
TECHNOLOGY
company
1
HOW DOES IT WORK?
Consumers
JUST EAT platform
Order and pay online
Order transmitted to TRs
over mobile network
Deliver to consumer
Order accepted by TRs
(JUST EAT processes payment and holds TR cash
from credit/debit card payment prior to distribution)
Takeaway restaurants (TRs)
JUST CONNECT terminal
GPRS
Real-time
e-commerce
JUST CONNECT
Terminal
JUST EAT
Servers
2
JUST EAT AT A GLANCE
History of leadership
►
►
►
►
►
A leader in the online takeaway business
2001: established in Denmark
2006: launched in the UK
2009: accelerated international expansion
Experienced team across functions and
geographies
Scale
► 40m orders in 2013, generating total transaction
value of over £650m
► 2013 net revenue of £96.8m 2013 (£80.4m in
the UK and Denmark)
► 2013 Underlying EBITDA of £14.1m (£30.2m in
the UK and Denmark)
► Over 36,000 contracted TRs
► >50% of orders via mobile in the UK
► c.1,000 employees
Large & growing market
Proven internationalisation
► Multi-billion pound highly fragmented takeaway
market, growing faster than GDP
► Online ordering growing much faster, fueled by
adoption of e-commerce and smartphone/tablet
penetration
► Takeaway Restaurants are a high margin
business, technically unsophisticated, but
commercially savvy
► Clear online takeaway market leader in:
— Denmark
— UK
► 11 new territories since 2007:
— 8 additional countries in Europe
— Canada, Brazil
— India
S ource: World Economic O utlook Database, Euromonitor, C allcredit Report and JU S T EAT
3
ROBUST AND ACTIVE RELATIONSHIPS WITH
TAKEAWAY RESTAURANTS
JUST EAT provides…
… High order volume and yield
►
Huge online presence
- Industry-leading SEO and PPC
- Bid on over 3.5m active
keywords globally
… More efficient order processing
►
►
Clear print out from JCT
… Ancillary benefits
►
Collective buying
►
Local field salesforce
►
Ability to pay for promotion
Free up the phone line
►
Well recognised brand
►
JUST EAT acts as stamp of
credibility (branded TRs)
►
Sales visits
►
Higher average order value
►
Marketing promotions
►
Roll out technology to industry
►
Conferences
►
►
Minimal staff time/ commitment
Offer platform
- Targeted and relevant offers
S ource: JU S T EA T
4
SIMPLE, PERFORMANCE BASED REVENUE MODEL
87.5% of revenue driven by consumer orders
Revenue Mix
Order Driven (B2C Revenue)
A
(Group 2013)
75%
Commissions
► Same price for consumers as
ordering directly from TRs
► Pricing depends on market
maturity
12%
Payment card/admin
fees revenue
► Small fee mainly charged on
payment card orders
► c.60% of orders paid via card
Connection fees
revenue
► One-off cost paid by TRs to join
the network1
► c.10-11% of order value
B
C
8% 5%
D
Top placement fee and
other revenue
► Top placement
► Restaurant products (bags, pizza
boxes, menu cards, etc.)
S ource: JU S T EA T
¹ With the exception of Denmark, w here TRs pay an annual subscription fee.
5
PROVEN SUCCESS AND LONG TERM RUNWAY
Denmark (11.9% revenue)
Proven success
► JUST EAT Denmark
commands c.44% of all
UK (71.1% revenue)
Other (16.8% of revenue)
Proven and
high growth
Proven strategy
► Most attractive market in Europe
► Other JUST EAT markets have
- Delivered takeaway food
even lower online penetration
deliveries and c.90% of all
market size estimated by
and represent significant
online orders
Callcredit Report at £4.4bn p.a.
growth opportunities
- Substantial runway
► JUST EAT Denmark
demonstrates 40%+
Underlying EBITDA margins
► Still relatively low online
marketplace penetration
- Online penetration by
JUST EAT of takeaway
ordering is only 2% in
France
- Online penetration of takeaway
ordering at 20-28% in the UK,
of which JUST EAT is c.50%
- Domino’s Pizza’s current digital
penetration at 69.4%
S ource: C allcredit Report , JU S T EA T management estimates and Domino’s P izza trading update as of Q 1 2014
N ote: P ercentages of G roup rev enue based on 2013 financials.
6
DELIVERY TAKEAWAY FOOD MARKET IS LARGE,
RESILIENT AND GROWING
A delivery takeaway food market of c.£58.0bn
Supported by strong drivers
Total Annual Delivery Takeaway Order Value (£bn)
► Urbanisation
JUST EAT
Markets1
£20.0bn
Non JUST EAT
Markets
£38.0bn
► Lifestyle change
► Increasing taste for exotic cuisine
► Increase in smartphone penetration
Structural growth faster than
GDP
Example of UK Market
3
5.8%
5.4%
2.5%
Other²
Size
(£bn)
UK
Denmark
France
Canada
Italy
4.4
0.2
2.3
2.6
3.7
Netherlands Spain
1.1
2.6
Brazil
1.1
Other
US
1.9
S ource: C allcredit Report; JU S T EAT management estimates
1. O ther exclude India.
2. O ther markets include N orw ay (£370m), Belgium (£673m), S w itzerland (£603m) and Ireland (£233m).
3. 100% Home Deliv ery / Takeaw ay (Euromonitor S ep-2013). G DP grow th projections from O ffice for Budget Responsibility .
17.6
20.3
1.1%
2011-2013
CAGR
GDP Growth
2013-2015
CAGR
Takeaway Market
7
RAPID CHANNEL SHIFT TO ONLINE ORDERING
The online ordering channel has grown significantly faster than
the overall takeaway market
Online penetration of takeaway ordering¹
Growth in online ordering
set to follow experience of food chains
Market Maturity
Domino’s Pizza’s Digital Penetration in the UK²
49% - 58%
80%
65.5%
70%
55.7%
60%
50%
32%
20% - 28%
44.3%
35.8%
40%
20%
30%
69.4%
27.8%
20%
Current online
penetration in
the UK
10%
0%
2009
France
UK
Canada
2010
2011
2012
2013
Q1 2014
Denmark
S ource: C allcredit Report, JU S T EA T management estimates
1. O nline penetration measured as the number of consumers w ho hav e ordered takeaw ay food online as a percentage of the total num ber of consumers w ho hav e ordered takeaw ay food.
2. Domino’s P izza presentation Q 4 trading update (2009-13). Represent digital penetration as of H1 each y ear.
8
STRONG ONLINE PRESENCE AND BRAND DRIVING
LOW COST PER ACTIVE ACCOUNT
JUST EAT is the #1 brand in the takeaway food category
Share of site visits in UK (%)
► Award-winning marketing initiatives
45%
► Most orders (c.88% in Q4 2013, UK) made
through free traffic to websites
► Top-of-mind awareness increased from
30%
20% to 39% (between Aug. 2012 and Dec.
Domino’s
2013, UK)
► Increased visibility and brand marketing via
Toptable
15%
Hungry
House
takeaway restuarants (at no or little cost)
► Aggregators’ share of site visits increased
► #1 iOS free app under food and drink
category1
0%
Sep-2010
Sep-2011
Sep-2012
Sep-2013
S ource: Experian Hitw ise and YouG ov
1 A s per A pp A nnie Index, as of 31-Dec-2013
9
STRONG AND DEFENSIBLE MARKET POSITION
SUPPORTED BY COMPELLING NETWORK EFFECTS
Strong network effects drive scale
Better choice of TRs
attracts more consumers
and increases frequency
Takeaway
Restaurants (UK)
25k
Number of
Orders (UK)
35m
1000
Peak orders per minute (UK)
800
600
30m
20k
Robust, Scalable Platform
25m
15k
20m
10k
15m
400
10m
5k
5m
0k
0m
2006 2007 2008 2009 2010 2011 2012 2013
2006 2007 2008 2009 2010 2011 2012 2013
200
More traffic and orders
attract more TRs to
JUST EAT platform
0
2008
2009
2010
2011
2012
2013
2014
S ource: JU S T EA T management estimates
10
CLEAR MARKET LEADING POSITIONS IN KEY REGIONS
JUST EAT operates across 13 countries
Region
Europe
Americas
Asia
Country
Launch
Built vs. bought Market position¹
UK
Mar-06
#1 of 6
Denmark
Aug-01
#1 of 3
France (JV)
Dec-11
#2 of 5
Spain
Nov-10
Ireland
Apr-08
#1 of 4
Switzerland
Apr-11
#1 of 4
Italy
May-11
Norway
Dec-09
#1 of 3
Netherlands /
Belgium (Flemish)
Jul-07 /
Apr-09
#2 of 2 /
#2 of 2
Canada
Aug-09
#1 of 22
Brazil
Aug-11
India (JV)
Jan-11
/
/
/
#1 of 3
#2 of 4
#1 of 4
#2 of 3
S ource: G oogle A naly tics, JU S T EAT
N ote: C ountries in bold font indicate JU S T EA T’s key markets.
¹ M arket position based on G oogle A naly tics for selected competitors in the market for the period from Jan-2013 to Jan 2014.
2 C anada excludes three restaurant chains and they are ahead of JU S T EA T market position.
11
SIGNIFICANT OPPORTUNITY FOR GROWTH
ACROSS GEOGRAPHIC FOOTPRINT
JUST EAT’s modest market penetration presents significant
headroom for robust growth potential
UK
Denmark
Other key
JUST EAT
countries1
Overall Takeaway Delivery
Market size2 (£bn)
4.4
0.2
7.7
Potential JUST EAT %
share at scale3
45%+
55%+
30%+
Commission rate
(as at Jan-2014)
12.0%
10.0%
10.1%
Implied JUST EAT
commission revenue at
scale (£m)4
235
11
230
2013 commission
revenue (£m)
52
8
13
2013 commission revenue
penetration (%)
22%
69%
6%
S ource: M arket size as per Callcredit Report and rest as per JUST EAT
N ote: C ommission rate above is based on Jan-2014, whereas commission revenue is based on FY2013.
1 O ther countries consist of Canada, France, Ireland and Spain. Commission rate represents an average of the relevant markets.
2 M arket size as per Callcredit Report.
3 M anagement ‘s strategy is to target a 45% market penetration in the U K and 30% in other key countries as per its mature Danish market. There is no certainty that this penetration target will be achieved or in w hat
timeframe.
4 C alculated by multiplying market size by target market share and commission rate. This revenue figure is illustrative only and is based on a target market share which may not be achieved .
12
UNTAPPED OPPORTUNITY FOR TAKEAWAY
COLLECTION
Expand addressable market by allowing takeaway food
collection in addition to delivery
Size of takeaway collection market
TRs (in ‘000)
TRs on JUST
EAT Platform
(in ‘000)
89.2
32.1
44.6
6.7
20.0
3.4
2.8
1.9
► Order for collection represents another
potential large and untapped market for
JUST EAT
— Half as big again as delivery
52%
48%
64%
Delivery TRs
39%
► Collection market potential has increased on
the back of smartphone penetration
76%
28%
22% 36%
11%
UK
61%
► Expand network to restaurants not offering
delivery services
Canada
Collection Only TRs
24%
► Scale of opportunity growing with increasing
popularity of JUST EAT mobile app
6%
France
Denmark
TRs on JUST EAT Platform
S ource: M arket size as per C allcredit Report; JU S T EA T
N ote: TRs on JU S T EA T platform as of 31-Dec-2013
13
POTENTIAL ACCRETIVE IN-MARKET AND
OUT-OF-MARKET M&A
Available resources through a combination of cash on balance sheet and £100m
of primary proceeds for in-market and out-of-market M&A opportunities
In-market
M&A
► Consolidate in-market position by acquiring complementary businesses
► Focus on markets with significant scale
Out-ofmarket M&A
► Enter new countries through acquisition of market leaders of scale
► Drive performance through implementation of proven business model, technology,
know-how and best practices
► Proven track record of acquiring and integrating 11 acquisitions in last 3 years
Capacity and
resources
► Available resources through a combination of cash on balance sheet and £100m of
primary proceeds before any leverage that the business can support
N ote: C ountries highlighted in the map represents JU S T EAT existing operations.
14
HIGH GROWTH BUSINESS MODEL
Substantial growth in JUST EAT orders…
… translates into robust top line expansion…
Orders (m)
TRs (000)
Active
Accounts
(m)
17.0
2.4
29.9
4.1
Revenue (£m)
36.4
5.9
96.8
40.2
59.8
25.3
33.8
13.9
2011
2012
2013
… with growing margins…
UK
DK
2011
2012
… and strong cash flow generation
Underlying EBITDA (£m) and margin (%)
22.5%
33.4%
37.1%
35.8%
40.4%
40.3%
Free Cash Flow (£m)
2.3
3.8%
2011
2012
1
15.3
14.1
14.5%
0.1
0.3%
2013
6.3
2.8
2013
2011
% cash conversion2
2012
2013
276%
109%
S ource: JU S T EA T
N ote: G roup rev enue and U nderly ing EBITDA differ from the sum of the contribution from the three reported regions due to cons olidation adjustments (e.g. inter-segment sales, share of equity accounted JV and
head office costs)
1.
F ree C ash F low defined as U nderly ing EBITDA + net change in w orking capital – capex – taxes – others
2.
% of U nderly ing EBITDA
15
INCREASE IN COMMISSION RATE AND ARPO
Average commission rate (% of transaction value)
ARPO (£)
In the UK,
commission rate
increased to 12.0%
in Jan-2014
11.0% 11.0%
10.8%
10.5%
8.8%
UK
9.0%
9.4%
Denmark
10.2%
£1.94
9.4%
Other
£2.04 £2.09
UK
2011
2012
£2.04
£1.97
£2.22
Denmark
£2.18
£2.13
£1.84
Other
2013
S ource: JU S T EA T
N ote: In Denmark, historically low er rate due to annual subscription fee charged to restaurants. Danish headline commission rate increased to 10.0% in S ep-2013
16
SIGNIFICANT REVENUE GROWTH
Contribution to revenue growth
By Revenue Driver (£m)
By Region (£m)
140.5%
34.4%
Y-o-Y
growth:
67.1%
Y-o-Y
growth:
18.3%
0.8
1.5
15.8%
67.4%
0.7
1.6
34.0
88.6%
7.7
27.7
96.8
59.8
2012
96.8
59.8
Order-driven Connection
Topplacement
Other
2013
2012
UK
Denmark
Other
2013
S ource: JU S T EA T
17
GROWTH AND PROFITABILITY IN THE UK
AND DENMARK
Revenue (£m)
Underlying EBITDA (£m)
30.2
80.4
4.7
11.5
51.1
17.7
10.0
30.2
8.8
4.0
25.5
68.8
8.0
41.1
4.8
2006 2007 2008 2009 2010 2011 2012 2013
Denmark
13.7
3.2
21.4
2010
UK
2011
2012
Denmark
Revenue growth
Underlying EBITDA growth
2013
UK
Underlying EBITDA margin
2012
2013
CAGR1
2012
2013
CAGR1
2011
2012
2013
Denmark
13%
16%
14%
27%
15%
21%
36%
40%
40%
UK
92%
67%
79%
186%
86%
130%
22%
33%
37%
S ource: JU S T EA T
N ote: 2006-2010 numbers are based on statutory accounts/management estimates and not under IF RS .
1 C A G R for 2011-2013.
18
GROUP SUMMARY FINANCIALS
2011
2012
2013
(£m)
Total transaction value (est.)
UK
DK
Other
141
66
26
273
70
74
472
81
130
Total TTV
233
417
682
Revenue
UK
DK
Other
21.4
8.8
3.5
41.1
10.0
8.7
68.8
11.5
16.3
Total Revenue
33.8
59.8
96.8
Underlying EBITDA
UK
DK
Other
Group Costs
4.8
3.2
(6.3)
(1.4)
13.7
4.0
(13.1)
(2.2)
25.5
4.6
(11.8)
(4.8)
0.1
2.3
14.1
(Dec year end)
YoY Growth
Total Underlying EBITDA
Underlying EBITDA Margin
-
-
77%
4%
62%
15%
S ource: JU S T EA T
N ote: A ll central costs directly related to running each country hav e been allocated so that the country U nderly ing EBITDA figures represent the full cost of operation and only those costs related to pure group
functions remain in G roup C osts.
19
FINANCIAL TAKEAWAYS
► Strong underlying growth in consumers, TRs and orders
► Proven ability to increase monetisation of platform (e.g.
commission rates, sign-up fees, advertising)
► Significant profitability achieved in the Denmark and UK
► Currently investing in other growth regions
► Demonstrated scalability of business model
► Highly cash generative
20
INVESTMENT HIGHLIGHTS
Strong
position in
attractive
market
Large and growing
addressable market
Clear market leading
positions in key
regions supported by
compelling network
effects
Clear
competitive
advantages
Strong online presence
and brand driving
low cost per active
account
Robust and active
relationships with
takeaway restaurants
Efficient, established
and scalable
technology platform
Strong
growth
opportunities
Significant opportunity
for growth across
geographic footprint
Largely untapped
opportunity for
takeaway collection
Potential accretive
in-market and
out-of-market M&A
Superior
execution
Strong track record of
growth and
profitability in the UK
and Denmark
Strong cash
conversation
Experienced
management team
21
SUMMARY
► Clear leadership position in the UK and Denmark
► Proven high margin and profitability
► Highly attractive cash conversion
► Significant runway in existing markets
► Further growth opportunities
22
APPENDIX
23
MANAGEMENT BIOGRAPHIES
David Buttress
Group CEO
Mike Wroe
Group CFO
Adrian Blair
COO
► David joined JUST EAT in March 2006
► He has led the UK business from launch
► Appointed CEO in January 2013 following his roles of Chief Commercial Offer and former
UK Managing Director
► Started his career with Coca-Cola Enterprises in 1998, during which time he had a variety
of senior sales roles
► Won the Account Manager of the Year award when he was managing the key national
restaurant customers in the UK for Coca-Cola
► Honours degree in Law & Business
► Mike joined JUST EAT in late 2008 and as CFO holds responsibility for Finance, Tax, Legal,
HR, Property and Administration
► Appointed as a director in 2013
► Prior to JUST EAT, Mike served as CFO at both Nexagent and Innovision R&T and was
involved in its IPO in 2001
► Mike has over 20 years commercial / Finance Director experience having qualified in 1993
with Deloitte
► Joint Honours Degree in Chemistry and Management from The University of Nottingham
► Adrian joined JUST EAT in 2011
► Leads all country teams globally across sales, marketing, operations and customer care,
running the Group’s operations in the UK, Brazil, Canada, France, Denmark, Netherlands,
Spain, Italy, Ireland, Belgium, Norway and Switzerland
► Previously worked at Spotify as Director of European Business Development and at Google
in a variety of senior management roles in California and London
► Taught undergraduate Economics at Harvard University and was part of the executive
team at Ask Jeeves
► MBA from Harvard Business School and a BA from Oxford University
24
MANAGEMENT BIOGRAPHIES
Carlos Morgado
CTO
Daniel Read
CPO
Mat Braddy
CMO
► Carlos joined JUST EAT in July 2009 to head Technology function
► Previously he acted as a consultant for several companies in the social media, mobile,
and online dating spaces
► Spent a number of years at AOL, growing the Technology team from a maintenance
role to become an integral part of the business, delivering and operating business-to
consumer and business-to-business applications
► Worked for a number of start-ups marrying his experience of the internet and
mainframe technologies to bring web research tools to the executive desktop
► PhD in Physics from the University of Bristol
► Daniel joined JUST EAT in 2011
► He is responsible for product vision and execution globally
► Previously Chief Product Officer at Ask.com, where he was tasked with driving product,
user experience and innovation
► Founding member of the team at Ask Jeeves UK, and before this, created the first web
and ecommerce operations at British Airways and Royal Mail
► Founder of product lab, Freeform, and an adviser to a number of consumer product
and technology businesses
► Bachelor of Arts from Leeds Business School and Master Degree in Design from Central
St Martins. He is also a Chartered Marketer
► Mat joined JUST EAT in 2009 and set about establishing the Company as the leading
brand in delivery takeaway around the world
► Built a team of experts covering Retail, Brand and Digital marketing
► In 2012, led the global launch of Skylight’s brand campaign to ban home cooking, Don’t
Cook, JUST EAT
► Previously worked for The Financial Times, toptable and gameplay.com
25
SCALABLE BUSINESS MODEL
2011-13
£m
Revenue
Cost of sales (net)
% of Revenue
Gross Profit
Gross Margin
Salaries
% of Revenue
Marketing
% of Revenue
Overhead Costs
2011
2012
33.8
2013
CAGR
59.8
96.8
69.3%
77.9%
(3.2)
(5.1)
(10.0)
9.3%
8.5%
10.3%
30.6
54.7
86.8
90.7%
91.5%
89.7%
(16.0)
(25.4)
(38.0)
47.4%
42.6%
39.2%
(7.8)
(15.3)
(23.4)
23.1%
25.6%
24.2%
(6.5)
(11.5)
(11.7)
19.2%
19.3%
12.1%
(30.3)
(52.3)
(73.1)
89.7%
(1.4)
(0.2)
87.5%
(2.2)
(0.2)
75.6%
(4.8)
0.4
0.1
2.3
14.1
0.3%
3.8%
517.9%
14.5%
Depreciation
Amortisation
(1.1)
(0.2)
(1.8)
(0.8)
(2.8)
(1.3)
Underlying EBIT
(1.2)
(0.3)
10.0
(3.4)%
72.2%
(0.5)%
10.3%
% of Revenue
Total Admin Costs
% of Revenue
of which Central Costs
Joint Ventures
Underlying EBITDA
% Growth
Underlying EBITDA Margin
% Growth
Underlying EBIT Margin
68.4%
54.0%
73.4%
34.4%
55.4%
1,095.1%
-
S ource: JU S T EA T
26
LIMITED SEASONALITY
Change in monthly orders driven by number of factors including number
of weekends, bank holidays, new year resolutions, and weather
Thousands
Monthly orders (UK)
3.5m
3.0m
Unusually hot
July
2.5m
2.0m
1.5m
1.0m
Dec
2012
Jan
Feb
Mar
May
Jun
Jul
Aug
Sep
Oct
Nov
Dec
2013
Q1
79.5% YoY growth
S ource: JU S T EA T
Apr
Q2
70.6% YoY growth
H1
44.6% contribution
Jan
2014
Q3
67.7% YoY growth
Q4
66.2% YoY growth
H2
55.4% contribution
27
REVENUE GROWTH (2011 – 2012)
Contribution to revenue growth
By Revenue Driver (£m)
Y-o-Y
growth:
84.6%
57.1%
1.5
By Region (£m)
65.8%
Y-o-Y
growth:
12.9%
145.6%
92.1%
1.8
1.1
23.2
(0.5)
5.2
19.7
59.8
33.8
2011
59.8
33.8
Order-driven Connection
Topplacement
Other
2012
2011
UK
Denmark
Other
2012
S ource: JU S T EA T
28
KEY ORDER DRIVEN METRICS
2011
2012
2013
£
1.94
2.04
2.09
% Growth
%
-
4.7%
2.4%
No. of orders
m
9.0
17.1
29.1
% Growth
%
-
89.3%
70.3%
£m
17.6
34.8
60.7
%
-
98.2%
74.3%
£
1.97
2.04
2.22
% Growth
%
-
3.9%
8.5%
No. of orders
m
3.5
3.8
4.1
% Growth
%
-
10.2%
8.1%
£m
6.8
7.8
9.2
%
-
14.5%
17.3%
£
2.18
1.84
2.13
% Growth
%
-
(15.5)%
15.7%
No. of orders
m
1.4
4.3
6.9
% Growth
%
-
212.9%
59.5%
£m
3.0
8.0
14.7
%
-
164.5%
84.6%
ARPO
UK
Order Driven revenue
% Growth
ARPO
Denmark
Order Driven revenue
% Growth
ARPO
Other
Order Driven revenue
% Growth
S ource: JU S T EA T
29
CONNECTION AND PLACEMENT FEE REVENUE
Connection fee revenue (£m)
Placement fee revenue (£m)
YoY Growth (%)
5.0
Total:
65.8%
34.4%
Other:
4,173.3%
136.1%
Denmark:
31.0%
31.3%
UK:
71.4%
27.0%
0.7
4.2
0.5
0.6
6.0
0.6
2.7
0.6
0.2
4.4
3.8
0.6
2.7
3.0
1.0
1.9
0.2
1.7
1.3
0.0
2.9
3.7
1.7
2011
S ource: JU S T EA T
2012
2013
UK
2011
Denmark
2012
2013
Other
30
UNDERLYING EBITDA GROWTH IN ESTABLISHED
GEOGRAPHIES AND INVESTMENT IN OTHER REGIONS
Contribution to Underlying EBITDA growth (£m)
£9.8m for established countries
£12.4m for established markets
1.4
11.8
0.6
0.6
14.1
(2.6)
0.9
8.9
0.1
(6.9)
2.3
(0.8)
0.1
Underlying
EBITDA
2011
% contribution:
∆ UK
∆ Denmark
∆ Other
409%
40%
(315)%
∆ Share of
∆ Head
Underlying
Results of Office Costs
EBITDA
JVs
2012
2%
(37)%
∆ UK
100%
∆ Denmark
5%
∆ Other
12%
∆ Share of
∆ Head
Underlying
Results of Office Costs
EBITDA
JVs
2013
5%
(22)%
S ource: JU S T EA T
31
STRONG CASH CONVERSION
Underlying EBITDA to free cash flow bridge (2013)
(3.9)
11.6
(4.2)
(2.3)
15.3
Others²
Free Cash Flow¹
14.1
Underlying EBITDA
Net Change in
Working Capital
14.6%
margin
31% change
in revenue
Attractive Underlying
EBITDA margins
Favourable working
capital dynamics
Capex
Taxes
4.0% of
revenue
Low capex
requirements
33.6%
tax rate
Optimise
tax paid
108.5%
conversion
High cash
conversion
¹ F ree C ash F low defined as U nderly ing EBITDA + net change in w orking capital – capex – taxes – others.
² O ther includes IP O costs, acquisition related expenses, results of JV and associates, loss on disposal of P P E and other non-cash items.
32
33