STAR Conference London. Company Presentation and First Half 2007 Results. 4 th October 2007

Transcription

1 STAR Conference London Company Presentation and First Half 27 Results 4 th October 27

2 Presenters today Group Chairman and Head of Broking Division Founder and key shareholder (15.7% indirectly through Alma Ventures SA) Background in consulting (McKinsey) and banking (Morgan Stanley) Degrees in Electrical Engineering and Computer Science, MBA from MIT Marco Pescarmona Group CEO and Head of BPO Division Founder and key shareholder (15.7% indirectly through Alma Ventures SA) Background in consulting (Booz Allen & Hamilton) in Italy and USA Degree in Industrial Engineering, MBA from MIT Alessandro Fracassi Stefano Rossini Member of Group Executive Committee, Head of Business & Corporate Development, Investor Relations Qualified shareholder (4.32%) Background in consulting (Bain & Company), banking (Goldman Sachs) and venture capital (Net Partners) Degree from Bocconi University, MBA from INSEAD 2

3 Gruppo MutuiOnline went public on the STAR segment of the Italian Stock Exchange on 6 th June 27 Offer structure and results Syndicate 4% free float post-greenshoe; price range 4.55 to 6.5 per share 1% secondary shares (sell-down by existing VC funds shareholders) Global Offering to Italian and international institutional investors, including QIBs in USA (Rule 144A); retail offering in Italy Final offering price 5.6 per share; offering oversubscribed 8.7x Deutsche Bank AG and Euromobiliare SIM S.p.A as Joint Bookrunners and Sponsors Euromobiliare SIM SpA as Responsabile del Collocamento and Specialist Euromobiliare SIM SpA as stabilization agent Share performance 6 th th June 21 st st Sept MOL performance vs. ALL STAR index,1,5, -,5 -,1 -, ,5 6, 5,5 5, 4,5 4, 3,5 3, 2,5 2, -,2 -,25 6/6 13/6 2/6 27/6 4/7 11/7 18/7 25/7 1/8 8/8 16/8 23/8 3/8 6/9 13/9 2/9 MOL ALLSTAR 6/6 13/6 2/6 27/6 4/7 11/7 18/7 25/7 1/8 8/8 16/8 23/8 3/8 6/9 13/9 2/9 1,5 Volumes (' shares) Price 3

4 Current shareholding structure Shareholding structure as of 27 th September 27 * 26,64% 2,46% 2,73% 4,32% 5,47% 31,4% 11,37% Alma Ventures SA** Nestor 2 Sprl Capital Research & Management Company Parvus Asset Ventures Jupiter Ventures SA Rossini Stefano Talaris Capital Partner LP GLG Partners LP Mercato 7,61% 8,% Disclosure of recent dealings 24/9/27 Update on execution of buy back program: 347,631 shares bought (.88% of share capital) 21/8/27 Internal dealing by Alma Ventures SA: 1, shares bought (.25% of share capital) 14/8/27 Internal dealing by Stefano Rossini: 125, shares bought (.32% of share capital) * Share capital ownerships communicated to the company by relevant investors according to CONSOB regulations; includes all investors above 2% ownership threshold ** The share capital of Alma Ventures S.A. is owned 5% by Guderian S.r.l. and 5% by Casper S.r.l.; Guderian S.r.l. is 1% owned by 4 Marco Pescarmona and Casper S.r.l. is 1% owned by Alessandro Fracassi.

5 Our vision is to be the most innovative financial services company capturing the opportunities stemming from the evolution of the underdeveloped Italian retail credit market DIVISION Broking 26: Rev. 12.7m EBIT 5.7m H1 27: Rev. 9.m EBIT (a) (a) 5.1m BPO 26: Rev. 9.1m EBIT 2.8m H1 27: Rev. 6.7m EBIT (a) (a) 2.m BUSINESS LINE Multi-brand broking of mortgages through Internet and telephone Multi-brand broking of consumer loans through Internet Multi-brand broking of mortgages through physical network Remote mortgage packaging services Mortgage underwriting and closing services Employee loan underwriting and closing services BRAND/ SERVICE SIZE/REVENUES 26 H m 6.5m 2.3m 1.6m.7m.9m 4.2m 2.7m 3.4m 2.3m 1.5m 1.7m Note: (a) Excludes one off costs related to restructuring of the Group and the IPO of the company amounting to 816, 5

6 Gruppo MutuiOnline offers a compelling investment opportunity in an exciting market GROUP Strong and committed management Strong underlying market fundamentals Superior financials BROKING DIVISION Leading position in online credit broking Independence from lenders Strong growth perspective for online distribution channels Leading position in high potential market State-of-the-art proprietary technology Operational excellence BPO DIVISION SYNERGIES 6

7 Relative immaturity of the Italian retail credit market supports significant long-term growth potential Outstanding residential mortgages as % of GDP (25) UK Spain Germany France 29.4% 52.6% 51.7% 8.% Residential mortgage flows ( bn) ,2 CAGR +13.% 56,2 62,8 Av era ge EU % 4 3 Italy 17.2% 2 1 % 1% 2% 3% 4% 5% 6% 7% 8% 9% 1% Source: European Mortgage Federation Source: Banca d Italia 24A 25A 26A Consumer credit outstanding as % of GDP (25) UK Germany Spain 16.% 1.4% 8.5% Consumer credit flows ( bn) ,5 5 CAGR +18.2% 58,3 67,8 France 7.3% 4 3 Italy 4.6% 2 1 % 1% 2% 3% 4% 5% 6% 7% 8% 9% 1% Source: European Central Banks Statistics Share of personal loans 24A 25A 26A 26% 36% Source: Assofin Note: Flows calculated as sum of flows from generalist banks, specialized banks and financial intermediaries 7

8 which is further enhanced by the growing presence of remote distribution channels Market share of non-traditional distribution % residential mortgage flows Remote distribution market shares % residential mortgages flows UK (23) 52% UK (23) 13,% Germany (24) 22% Germany (24) 11,% USA (23) 66% USA (23) 8,% Italy (26) 35% Italy (26) 2,8% % 2% 4% 6% 8% % 2% 4% 6% 8% 1% 12% 14% 16% Source: A.T. Kearney 27 report commissioned by the Company Note: Figures in brackets indicate the year Market shares by distribution channel % residential mortgage flows Source: A.T. Kearney 27 report commissioned by the Company Note: Figures in brackets indicate the year Household Internet penetration (December 25 January 26) 1% UK 5% 8% 6% 4% 2% % 92% 8% 2A 65% 35% 26A Of which 2.8% coming from remote channels, virtually non-existent in 2 Germany 44% France 4% Italy 31% % 1% 2% 3% 4% 5% 6% Non-traditional distribution Traditional bank distribution (branches) Source: A.T. Kearney 27 report commissioned by the Company Source: Special Eurobarometer n. 249, July 26 8

9 Broking division business model focuses on lead generation Loangranting phases Lead Generation Packaging Underwriting Closing Product Portfolio Management Contact Generation Gathering of Applications Lead Management Key throughout all phases: Incentives to stimulate and reward commercial performance Proprietary IT platform (online front-end and sales force back-end including CRM) Revenue model Revenues generated through success fees paid at closing of loan Commissions range between 1% and 4% of loan amount and are generally based on a step-up scheme that depends on total brokered volumes during the year 9

10 Consumers can easily and transparently compare mortgage quotes online 1

11 Unique value proposition in generating leads and maximizing their value Strong lead generation with low unit acquisition costs Quantitative approach to marketing Free and transparent price comparison Broad competitive product portfolio Continuous recruiting, training and monitoring of introducers (CreditPanel) Total closed mortgages (#) 6, 5, 4, 3, 2, 1, 2,558 CAGR +42.3% 4,59 5,243 24A 25A 26A Market share (a) 1.6%* Ability to maximize value per lead application Highly skilled and incentivized consultants Commissions negotiated on volumes Dedicated accounts for the management of the relationship with financial institutions Process optimization with lending partners Total closed personal loans (#) 1, 8, 6, 4, 2, 4,643 CAGR +33.7% 5,341 8,297.4% 24A 25A 26A (a) Company analysis based on A.T. Kearney 27 report commissioned by the Company and Company data * 91% of mortgage flows distributed through Remote Channels (MutuiOnline) and 9% flows distributed through the Physical Channel (CreditPanel) 11

12 The BPO Division operates in a totally underdeveloped market that has significant growth potential Outsourced mortgage fulfilment processes in selected European countries 26, (%) Netherlands 5% Germany Spain** 28% 35% Growth drivers of the Italian BPO market Underlying growth of the Italian credit market Fragmentation of the loan value chain driven by competitive pressures, technology, regulation and market growth UK* 27% Italy 2% % 1% 2% 3% 4% 5% 6% Source: A.T. Kearney 27 report commissioned by the Company * Estimate on 25 mortgages flow ** Estimate on 25 mortgages stock 12

13 BPO offering is structured along three business lines that cover the bulk of the origination process for mortgages and loans Origination Process Lead Generation Packaging Underwriting Closing Description Products Mortgages Employee loans Generate interest to attract potential prospects From first client contact to collection of a full application FEC sales activities after lead generation, taking care of every interaction with client in order to collect a signed application and documents for underwriting analysis From preliminary analysis to final credit decision, through detailed document review CEI From contract preparation to collection of all signed document income and real estate analysis, appraisers and notaries management, system data input, control activities according to bank underwriting guidelines, application report and contracts drafting, closing organization and follow-up CLC underwriting, coordination with insurance company and borrower employer to collateralize loan, refinancing process management Revenue model Success fee on each closed mortgage calculated as a percentage of mortgage amount Rendered service basis with payment irrespective of outcome. Unit fees for each phase of credit and underwriting process with further potential for set-up/special customization fees 13

14 The service delivery model is based on a unique combination of technology and workflow organization A re-engineered process.. Streamlined activities Reduced lead-times Standardized yet flexible Totally integrated workflow and CRM engine Paperless Automated wherever possible Lender Borrower Brokers Insurance Appraisers Credit Bureaus leveraging technology integrating all transaction parties managed with a focused organization Superior service model of the BPO Division Continuous productivity and workload monitoring Cradle to grave logic SLA monitoring for each operator Consistent incentive design 14

15 Superior offering and ability to attract new clients drives significant market presence New client acquisition and market development Generation of valuable opportunities Attractive value proposition Strong track record with primary national and international clients Market share of the BPO division s three business lines in their respective markets 26, (%) FEC ('packaging') 1.3% Operational and technological excellence Strategic partnerships management Flexibility of production capacity and attractive service delivery costs Proprietary technological platform with best-in-class functionality and ability to integrate with financial institutions legacy systems Fully-operational business continuity systems Outstanding change management ability Excellent delivery/execution of the value proposition Incentive schemes aligned to financial institutions' goals CEI ('underwriting & closing mortgages') CLC ('underwriting & closing employee loans') 1.7% 2.%.%.5% 1.% 1.5% 2.% 2.5% Source: Company estimates on A.T. Kearney 27 report commissioned by the Company 15

16 The Italian residential mortgage market slowdown in H1 27 has not impacted our business growth Residential mortgage flows in first half of the year ( bn) 35 3 Y-o-Y 31,7 -.3% 31, H1 6A H1 7E Broking Division origination in first half of the year ( mn) 6 5 Y-o-Y +72.8% 579 High growth of remote distribution channel penetration vs. other channels (traditional and non-traditional ones) Part of H1 27 flows related to the new additional re-mortgage demand boosted by the Jan 27 Law Decree Bersani (abolishing/capping prepayment rates on existing mortgages) H1 6A H1 7A Source: Banca d Italia and Company data; H17 estimate of residential mortgage flows has been calculated adding Q17 data published by Bnaca d Ialia to Q27 data which has been estimated applying Assofin residential mortgage flows Q2 on Q1 growth rate to Q1 data published by Banca d Italia 16

17 Historical financial results show explosive revenue growth Group Revenues ( m) % 26% CAGR +67% % 37% 58% 42% 24A 25A 26A BPO Broking Division DivisionBroking BPO Division 21.8 Broking Division Revenues ( m) % 22% 71% 8.4 5% 18% 77% % 18% 76% 24A 25A 26A M utuionline PrestitiOnline CreditPanel BPO Division Revenues ( m) CAGR +48% CAGR +113% % 38% 5% 2. 46% 6% 5% 4% 5% 24A 25A 26A FEC CEI CLC 17

18 combined with high profitability and cash generation EBIT ( m) CAGR +93% % 98% 36% 2% 67% 33% 24A 25A 26A 8.5 EBIT margin (%) 5% 4% 3% 2% 1% % 39% 29% 3% 35% 24A 25A 26A 45% 39% 31% BPO Broking Division Division Broking BPO Division Broking Division BPO Division Group Net income ( m) Operating cash flow ( m) CAGR +61% CAGR +213% A 25A 26A 24A 25A 26A 18

19 H1 results underline continued strong revenue growth Group Revenues ( m) Y-o-Y +52% 15.7 Broking Division Revenues ( m) % 19% 74% Y-o-Y +54% 9. 1% 18% 72% Y-o-Y +54% H1 6 H1 7 8 MutuiOnline PrestitiOnline CreditPanel H1 6 H1 7 Y-o-Y +5% BPO Division Revenues ( m) % 42% Y-o-Y +5% % 35% Broking Division BPO Division 2 47% 4% H1 6 H1 7 FEC CEI CLC 19

20 and high profitability both at divisional and group level EBIT ( m) EBIT margin Y-o-Y +54% Y-o-Y +89% Y-o-Y 3% H H1 27 (a) (a) Broking Division 46% 45% 57% BPO Division 43% 31% 29% Group 45% 39% 45% H1 6 H1 7(a) Broking Division BPO Division Net income ( m) ,8 Y-o-Y +29% 3,6 H1 6 H1 7 Net income margin H H1 27 Group 27% 24% 23% Note: (a) Excludes one off costs related to restructuring of the Group and the IPO of the company amounting to 816, 2

21 Frequently Asked Questions How is the subprime market crisis impacting your business? The business of the Group has not been and should not be adversely impacted by issues linked to subprime mortgage products, for several reasons: 1. In Italy, the only country where the Group currently operates, the market for subprime mortgages is is not developed; 2. The Broking Division carries out a pure broking activity and therefore it it neither lends money nor takes credit risk. Moreover, also due to its focus on remote distribution channels, the Broking Division is is positioned to serve customers of medium-high standing; 3. The mortgage volumes currently processed in outsourcing by the BPO Division are mainly targeted to customers of medium-high standing and have historically displayed low default rates. 21

22 Frequently Asked Questions What do you consider as managers the main risk factors potentially affecting your business? The risk factors highlighted in the prospectus, including: The company faces risks relating to possible service interruptions, errors and breaches of security in its IT, telecommunications and electrical systems; Decreases in the fees the company receives for its credit broking and BPO services could adversely affect the business, potentially harming current profitability levels; Reclassification as employment agreements of certain collaboration agreements could result in additional liabilities for the company; Company results depend significantly on general trends in the Italian mortgage, consumer credit, financial and real estate markets (e.g. demand for loan products we broker could decline with increases in interest rates/other macroeconomic factors); A significant percentage of BPO Division s revenues derives from a limited number of clients. 22

23 Gruppo MutuiOnline offers a compelling investment opportunity in an exciting market GROUP Strong and committed management Strong underlying market fundamentals Superior financials BROKING DIVISION Leading position in online credit broking Independence from lenders Strong growth perspective for online distribution channels Leading position in high potential market State-of-the-art proprietary technology Operational excellence BPO DIVISION SYNERGIES 23

24 Appendix

25 Management structure M. Pescarmona A. Fracassi S. Rossini Board of Directors Executive Committee M. Pescarmona Chairman A. Fracassi CEO S. Rossini Executive director F. Boni Non executive director P. Gesess Non executive director M. Zampetti Non executive director P. Vagnone Independent director A. Garrone Independent director V. Terzi Independent director Investor Relations S. S. Rossini Bus. & Corp. Dev. S. S. Rossini Broking Division M. Pescarmona BPO Division A. Fracassi Group Services M. Pescarmona 25

26 Recent changes in the regulatory framework could positively impact the Group s reference market Mortgages Law Decree N 7 January 31, 27 In January 27 the Italian Government approved a decree regarding the mortgage market The decree has introduced three relevant key rules: Elimination of early pre-payment fees on new mortgage contracts Notary deed no longer required for the lien cancellation Measures to favour lien portability Employee loans Law Decree N 313 December 27, 26 In December 26 the Italian Government approved a decree regarding the employee loans market The decree has introduced: A precise guidance extending the application of employee loans to pensioners BPO IAS 39 Since 26 Italian Banks must report under IFRS IAS 39 gives a precise guidance for the valuation of financial assets in banks balance sheets According to IAS 39, banks can amortize the costs related to a particular financial assets (including loans and mortgages) over the entire period of life of the related loan Bank internal administrative costs, on the other hand, in order to be amortized must be: Directly related to the loan (e.g. a commission paid to an outsourcer) Definable and computable upfront 26

27 Gruppo MutuiOnline Profit & Loss breakdown Margin components (26) 2.5% 26.4% 1% 26.2% 5.8% 5.1%.4% 39.% 15.8% 23.6% Total revenues Other income* Services costs** Personnel costs Other operating costs Depreciation EBIT margin Net interest income*** Tax Net profit margin * Composed of other revenues ( 371,) and capitalised costs ( 185,) ** 12.1% accounted for by marketing expenses *** Composed of interest income ( 219,) and interest expense ( 128,) 27