Q12018 Results Conference Call

Scout24 AG Christian Gisy (CFO) May 8, 2018

Q1 2018 Results Conference Call

page 1

Disclaimer

This document has been issued by Scout24 AG (the "Company" and, together with its direct and indirect subsidiaries, the "Group") and does not constitute or form part of and should not be construed as any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any securities of the Company, nor shall any part of it nor the fact of its distribution form part of or be relied on in connection with any contract or investment decision, nor does it constitute a recommendation regarding the securities of the Company or any present or future member of the Group.

All information contained herein has been carefully prepared. However, no reliance may be placed for any purposes whatsoever on the information contained in this document or on its completeness. No representation or warranty, express or implied, is given by or on behalf of the Company or any of its directors, officers or employees or any other person as to the accuracy or completeness of the information or opinions contained in this document and no liability whatsoever is accepted by the Company or any of its directors, officers or employees nor any other person for any loss howsoever arising, directly or indirectly, from any use of such information or opinions or otherwise arising in connection therewith.

The information contained in this presentation is subject to amendment, revision and updating. Certain statements, beliefs and opinions in this document are forward-looking, which reflect the Company's or, as appropriate, senior management's current expectations and projections about future events. By their nature, forward-looking statements involve a number of risks, uncertainties and assumptions that could cause actual results or events to differ materially from those expressed or implied by the forward-looking statements. These risks, uncertainties and assumptions could adversely affect the outcome and financial effects of the plans and events described herein. Statements contained in this document regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. The Company does not undertake any obligation to update or revise any information contained in this presentation (including forward-looking statements), whether as a result of new information, future events or otherwise. You should not place undue reliance on forward-looking statements, which speak only as of the date of this document.

This document is not an offer of securities for sale in the United States of America. Securities may not be offered or sold in the United States of America absent registration or an exemption from registration under the U.S. Securities Act of 1933, as amended. Neither this document nor any copy of it may be taken or transmitted into the United States of America, its territories or possessions or distributed, directly or indirectly, in the United States of America, its territories or possessions or to any US person.

By attending, reviewing or consulting the presentation to which this document relates or by accepting this document you will be taken to have represented, warranted and undertaken that you have read and agree to comply with the contents of this notice.

Nothing in this document constitutes tax advice. Persons should seek tax advice from their own consultants or advisors when making investment decisions.

Due to rounding, numbers presented throughout this document may not add up precisely to the totals indicated, and percentages may not precisely reflect the absolute figures for the same reason. Information on quarterly financials have not been subject to audit and are thus preliminary.

Recap: IFRS changes to be considered for 2017 and Outlook 2018

IFRS 15 (Recognition of Revenues)

Mandatory as of 1 January 2018
2017 financials restated, Actuals 2018 and Outlook 2018 adapted to reflect adjustment
Negative impact on Revenue of € 7.2m in 2017 and ~€8.0 m in 2018 for full year

IFRS 16 (Accounting of Leases)

Mandatory as of 1 January 2019, Scout24 early adopter
2017 not restated, Actuals 2018 and Outlook 2018 adapted to reflect adjustment
Impact on ordinary operating EBITDA of positive ~€ 6.0m for full year 2018 (2017 impact would have been ~€ 5.6m for full year)
€ 41.0m to balance sheet extension for the first quarter 2018 and additional depreciation of € 6.0m for the full year 2018

IFRS 9 (Valuation of Financial Instruments)

Mandatory as of 1 January 2018
2017 not restated, Actuals 2018 adapted to reflect adjustment
No impact on P&L, € 3.9m impact in Trade Receivables and Retained Earnings for opening balance sheet 2018

No impact on underlying operational growth and profitability trajectory

Key Financial Highlights

Note: All figures in € millions.

Q1 2017 restated for IFRS 15. Q1 2018 Figures considering financial reporting adjustments for IFRS 9, IFRS 15, IFRS 16. Q1 2018 cash contribution adjusted for capital expenditures incurred due to the first time application of IFRS 16. Like-for-like comparisions reflect pro-forma adjustment as if IFRS16 would not have been adopted in 2018. Cash Conversion like-for-like does not include extraordinay capital expenditures.

Ordinary operating (oo)EBITDA represents EBITDA adjusted for non-operating and special effects. These include primarily expenses for reorganisation, expenses in connection with the capital structure of the Company and company acquisitions (realised and unrealised), as well as parts of the effects., ordinary operating EBITDA margin of a segment is defined as ordinary operating EBITDA as a percentage of external segment revenues.
Cash contribution is defined as ooEBITDA less Capital expenditures, cash conversion as ooEBITDA / (ooEBITDA less Capital expenditure)

ImmobilienScout24 Platform for Continued Growth

Q1 2017 restated for IFRS 15. Q1 2018 Figures considering financial reporting adjustments for IFRS 9, IFRS 15, IFRS 16. Q1 2018

ImmobilienScout24 VIA – Providing Value to our Partner's Businesses

VIA Revenues as % of total IS24 Revenues (Q1 2018)

AutoScout24 Delivering on Growth Potential

Q1 2017 restated for IFRS 15. Q1 2018 Figures considering financial reporting adjustments for IFRS 9, IFRS 15, IFRS 16. Q1 2018.

AutoScout24 Performance and Display – Clear Benefit for our Partners

MIA Revenues as % of total AS24 Revenues (Q1 2018)

Consumer Services On the Way to a €100m+ Business

Q1 2017 restated for IFRS 15. Q1 2018 Figures considering financial reporting adjustments for IFRS 9, IFRS 15, IFRS 16. Q1 2018.

Scout24 Consumer Services Driving Digitisation through Product Innovation

Bringing Car Financing to the Next Level

Finance Direct Consumer Monetisation

Creating a Scalable and Recurring Business Model, Consumers Become Customers

Ordinary Operating Cost Comments

(in €m)	Q1 2017	Q1 2018
			Increase in capitalisation of internally • generated assets partially due to change in
Revenues	111.9	123.4	methodology of accounting (€ 1.2m) as well as by increased product development
Own work capitalised	2.6	4.7
Personnel (incl. external labour)	(31.2)	(36.3)	Increase in staff of ~10% (113 FTE) in Q1 • 2018 compared to Q1 2017 resulting in increase of 8% in own staff cost
Marketing (online & offline)	(13.8)	(15.4)	Increase partially due to change in • methodology of accounting (€ 1.2m) in the
IT	(3.8)	(4.7)	area of external labour
Other costs	(9.7)	(8.0)
Total operating cost	(56.0)	(59.7)	Marketing spending to support products • like realtor lead engine and premium
Ordinary operating EBITDA	56.5	63.7	membership
Ordinary operating EBITDA-margin	50.5%	51.6%

Below EBITDA Items

	Q1 2017	Q1 2018
(in €m)
Ordinary operating EBITDA	56.5	63.7
Non-operating items	(3.2)	(2.9)
Reported EBITDA	53.3	60.8
D&A	(4.3)	(6.7)
D&A on PPA items	(10.2)	(9.0)
EBIT	38.8	45.2
Results Equity Method	.0	.0
Finance Income	1.3	1.0
Finance Cost	(3.5)	(5.5)
Earnings before Tax	36.6	40.6
Taxes on Income	(12.4)	(10.4)
Earnings after Tax	24.2	30.2
Earnings per Share (in €)	0.23	0.28
Adjusted Earnings1	33.5	53.0
(in €)1 Earnings per Share adjusted	0.31	0.34

• Includes € 1.6m of extraordinary income for the sale of the trade mark JobScout24 CH • Includes expenses of € 2.0m for share-based compensation, € 1.2m for PMI related activities, € 0.7m for reorganisation and € 0.4m for the office relocation in Munich

• Includes € 1.5m of depreciation resulting from the adoption of IFRS 16

• Q1 2018 including Amortization of capitalized financing fees of €2.6m included (including write-offs due to refinancing and prepayment, non-cash relevant)

• Effective tax rate of 26% driven by one-off reduction of deferred tax liabilities and overall reduced tax rate (31% versus 33%)

Unaudited. Excluding Non-recurring items and D&A on PPA items, calculated with normalized tax rate. Detailed reconciliation in appendix.

Capital structure Strong deleveraging profile and low interest margins supporting dividend payment

Margin ratchet thresholds

Leverage (Net Debt/EBITDA)		Margin1
	Term Loan	Revolving Facility2
>3.00x	2.00%	1.60%
>2.50x	1.70%	1.30%
>2.00x	1.50%	1.10%
>1.50x	1.30%	0.90%
>1.00x	1.10%	0.70%
<1.00x	0.90%	0.50%

Increase of financial liabilities and increase in ordinary operating EBITDA due to the adoption of IFRS 16 result in net increase of the leverage ratio of 0.14:1 (like-for-like leverage: 2.03:1)
Placement of Schuldschein at end of Q1 2018 for partial refinancing of bank debt, expected interest savings of one million in the first year
Further repayment of EUR 35 million towards Term Loan end of March
Management and Supervisory Board will propose 0.56€ Dividend per share to Annual General Meeting in June 2018, reflecting 40% pay-out ratio
Target pay-out ratio of 30.0% to 50.0% of adjusted net income over time
Leverage test on a quarterly basis with new spread applicable 45 days post quarter end
Revolving Facility is subject to a utilisation fee depending of the amount drawn (<33.3% : 0.1% , <66.7% : 0.2% , >66.7% : 0.4%)
Net debt is defined as total debt (current and non-current financial liabilities) less cash and cash equivalents

Outlook Full Year 2018 Reiterating full year outlook

Revenue		ordinary operating EBITDA margin	Adopted for IFRS 15 IFRS 16
ImmobilienScout24	4.0% to 6.0% growth	ImmobilienScout24	At least 68.0%
AutoScout24	At least €180.5m	AutoScout24	Around 52.0%
Scout24 Consumer Services	Around €87.0m	Scout24 Consumer Services	Increase by at least one percentage point
Scout24 Group	9.0% to 11.0% growth	Scout24 Group	Between 56.0% and 57.5%

Adoption of Guidance has no impact on underlying operational growth and profitability trajectory

Appendix

Adopting Revenue Guidance to Reflect New IFRS Standards Adoption

Revenue 2017 as reported (in €m)

ImmobilienScout24	236.0
AutoScout24	162.6
Scout24 Consumer Services	80.6
Scout24 Group	479.8
Revenue Guidance as of 28/03/2018
ImmobilienScout24	4.0% to 6.0% growth
AutoScout24	At least €185.0m (represents around 14% growth)
Scout24 Consumer Services	Around €90.0m (represents around 12% growth)
Scout24 Group	9.0% to 11.0% growth

Revenue 2017 restated for IFRS 15 (in €m)

ImmobilienScout24	235.9
AutoScout24	158.7
Scout24 Consumer Services	77.5
Scout24 Group	472.6
Revenue Guidance adjusted
ImmobilienScout24	4.0% to 6.0% growth
AutoScout24	At least €180.5m (represents around 14% growth)
Scout24 Consumer Services	Around €87.0m (represents around 12% growth)
Scout24 Group	9.0% to 11.0% growth

Adopted Guidance reflecting lower starting base 2017, no adjustment of growth profile

Updated Guidance reflecting margin improvement based on lower revenue due to IFRS 15 (no change in ordinary operating EBITDA) as well as expected positive impact of IFRS 16 adjustment.

Note: Reflecting Financials as if the new segment structure would have been implemented already in 2017, Impact of IFRS 16 based on pro-forma calculation, 2017 financial will not be restated.

ImmobilienScout24: Historical data adjusted to new disclosure, 2017 adjusted for IFRS 15

ImmobilienScout24 (in €m)	Q1 2016	Q2 2016	Q3 2016	Q4 2016	Q1 2017	Q2 2017	Q3 2017	Q4 2017
Revenue with Residential real estate partners	27.9	28.0	28.1	28.2	27.7	28.4	28.6	28.9
Revenue with Business real estate partners	11.3	11.2	11.5	11.6	11.5	11.8	11.8	12.3
Revenue with private listers and others	17.0	18.3	18.2	18.5	17.9	19.1	18.8	19.2
Revenue	56.2	57.5	57.8	58.3	57.1	59.3	59.3	60.4
Ordinary Operating EBITDA	n/a*	n/a*	n/a*	n/a*	38.1	40.2	40.5	38.7

AutoScout24: Historical data adjusted to new disclosure, 2017 adjusted for IFRS 15

AutoScout24 (in €m)	Q1 2016	Q2 2016	Q3 2016	Q4 2016	Q1 2017	Q2 2017	Q3 2017	Q4 2017
Revenue with Dealers Germany	13.6	13.9	14.4	15.6	16.3	16.7	17.1	17.8
Revenue with Dealers in European Core Countries	11.4	13.1	13.1	13.3	14.0	15.1	15.5	16.9
Revenue with OEM	4.6	5.0	4.6	6.3	3.1	4.7	3.3	6.3
Other Revenue	2.8	3.1	3.1	3.0	2.9	3.1	2.8	3.0
Revenue	32.4	35.1	35.2	38.2	36.3	39.5	38.8	44.1
Ordinary Operating EBITDA	n/a*	n/a*	n/a*	n/a*	14.8	19.7	20.1	22.0

Scout24 Consumer Services: Historical data adjusted to new disclosure, 2017 adjusted for IFRS 15

Consumer Services (in €m)	Q1 2016	Q2 2016	Q3 2016	Q4 2016	Q1 2017	Q2 2017	Q3 2017	Q4 2017
Revenue with Finance Partners	8.3	8.7	8.4	8.9	8.9	10.3	9.7	10.5
Services revenue	5.0	4.9	5.4	4.8	6.0	5.6	6.2	5.8
rd 3 Party Display revenue	3.4	3.8	3.4	5.3	3.4	3.6	2.9	4.4
Revenue	16.8	17.4	17.2	19.0	18.4	19.6	18.9	20.8
Ordinary Operating EBITDA	n/a*	n/a*	n/a*	n/a*	6.2	7.5	6.4	8.2

Reconciliation Adjusted Earnings

(€ millions)	Q1 2017	Q1 2018
Earnings before Tax	36.6	40.6
Add back non-operating items	3.2	2.9
Add back D&A on PPA items	10.2	9.0
Add back extraordinary finance expense/ income and effects from derivative instruments	(1.3)	(0.9)
Adjusted Earnings before Tax	48.7	51.6
Adjusted Tax based on normalized Tax rate	(15.2)	(16.3)
Adjusted Earnings attributable to owners of the parent	33.4	35.3
Earnings per Share adjusted (in €)1	0.31	0.34
Weighted average of shares (in million)	107.6	107.6

Based on relevant nominal tax rate as stated in Annual Report 2017 and 2017 respectively. Q1 2017: 31.3%; Q1 2018: 31.6%

Note: Voluntary information. unaudited. not reviewed.

Income Statement

(EUR '000)	Q1 2018	Q1 2017
Revenues	123,403	111,883
Own work capitalised	4,673	2,559
Other operating income	1,949	197
Total operating performance	130,024	114,639
Personnel expenses	(30,860)	(28,361)
Advertising expenses	(16,121)	(13,870)
IT expenses	(4,871)	(3,823)
Other operating expenses	(17,388)	(15,333)
EBITDA (Earnings before interest. tax. depreciation and amortisation)	60,784	53,252
Depreciation. amortisation and impairment losses	(15,606)	(14,419)
EBIT (Earnings before interest and tax)	45,177	38,833
Results from investments accounted for using the equity method	29	(11)
Financial income	1,000	1,323
Financial expenses	(5,564)	(3,539)
Net financial result	(4,535)	(2,227)
Earnings before tax	40,643	36,607
Income taxes	(10,424)	(12,374)
Earnings after tax	30,219	24,233
Earnings per share (EUR)	0.28	0.23
Diluted earnings per share	0.28	0.22 page 22

Balance Sheet 1/2

Assets	31/03/2018	31/12/2017
(EUR '000)
Current assets	124,190	115,275
Cash and cash equivalents	58,002	56,659
Trade receivables	49,588	47,432
Financial assets	910	1,075
Income tax receivables	3,038	2,653
Other assets	12,653	7,456
Non -current assets	2,057,917	2,025,188
Goodwill	836,675	836,675
Trademarks	984,501	984,609
Other intangible assets	220,097	188,873
Property, plant and equipment	10,327	8,161
Investments accounted for using the equity method	1,081	1,052
Financial assets	927	991
Deferred tax assets	1,837	2,312
Other assets	2,472	2,515
Total assets	2,182,108	2,140,463

Balance Sheet 2/2

Equity and liabilities	31/03/2018	31/12/2017
(EUR '000)
Current liabilities	146,879	159,194
Trade payables	22,276	22,224
Financial liabilities	57,985	79,511
Other provisions	7,603	6,889
Income tax liabilities	17,211	12,843
Contract liabilities	9,578	9,168
Other liabilities	32,227	28,559
Non -current liabilities	936,716	915,773
Financial liabilities	564,896	538,043
Pension and similar obligations	552	526
Other provisions	2,543	3,569
Income tax liabilities	54	62
Deferred tax liabilities	366,544	371,492
Other liabilities	2,126	2,081
Equity	1,098,513	1,065,496
Subscribed share capital	107,600	107,600
Capital reserve	423,389	423,302
Retained earnings	563,878	533,659
Measurement of pension obligations	(133)	(121)
Other reserves	3,779	1,056
Equity attributable to shareholders of parent company	1,098,513	1,065,496
Non -controlling interests
Total equity and liabilities	2,182,108	2,140,463

Cash Flow Statement 1/2

(EUR '000)	01/01/17 - 03/31/17	01/01/18 - 03/31/18
Earnings after tax	30,219	24,233
Depreciation. amortisation and impairment losses	15,606	14,419
Income tax expense/(income)	10,424	12,374
Financial income1	(1,000)	(1,323)
Financial expenses1	5,564	3,539
Result from investments accounted for using the equity method	(29)	11
Result on disposal of intangible assets and property. plant and equipment	(1,656)	2
Other non-cash transactions	363	672
Change in other assets not attributable to investing or financing activities	(4,360)	(4,146)
Change in other liabilities not attributable to investing or financing activities	4,177	(4,037)
Change in provisions	(369)	(1,514)
Income tax paid	(12,091)	(6,497)
Cash flow from operating activities	46,848	37,733
Investments in intangible assets, including internally generated assets and assets in development	(4,823)	(3,396)
Investments in property, plant and equipment	(3,129)	(677)
Proceeds from disposal of intangible assets and property, plant and equipment	1,713	3
Investments in financial assets	-	(141)
Proceeds from sale of financial assets	2	47
Investments in companies accounted for using the equity method	(350)	(100)
Interest received	1	2
Cash flow from investing activities	(6,586)	(4,262)

Cash Flow Statement 2/2

(EUR millions)	01/01/17 - 03/31/17	01/01/18 - 03/31/18
Cash flow from investing activities	(6,586)	(4,262)
Repayment of short-term financial liabilities	(31,481)	(44)
Drawing down of medium- and long-term financial liabilities	215,000	-
Repayment of medium- and long-term financial liabilities	(220,000)	-
Interest paid	(2,436)	(2,997)
Cash flow from financing activities	(38,917)	(3,041)
Effect of foreign exchange rate changes on cash and cash equivalents	(2)	3
Change in cash and cash equivalents	1,343	30,433
Cash and cash equivalents at beginning of period	56,659	43,441
Cash and cash equivalents at end of period	58,002	73,874

IR Contact details and financial calendar

Financial Calendar (expected) Full year report

Thursday 21 June 2017	Annual General Meeting
Monday 13 August 2017	Half Year Report 2018
Wednesday 7 November 2017	Interim Report Q3 2018

report.scout24.com/2017

CSR Report csrbericht.scout24.com/en

http://www.scout24.com/en/Investor-Relations.aspx

Investor Relations Contact

Britta Schmidt Vice President Investor Relations & Controlling

Diana Apostol Junior Manager

Investor Relations

Tel : +49 89 444 56 3278 ; Fax : +49 89 444 56 193278; Email : [email protected]

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