Investor update presentation - August 2016
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Investor update presentation August 2016
Content
Update on Q2 2016 financial performance 4-8
Update on hospitality projects 10-11
Update on E-commerce businesses 13-16
2
Section 1 Update on Q2 2016 financial performance
Sector performance impacted by general macroeconomic
environment and government austerity measures
Government revenue Corporate revenue cash sales (Retail) revenue online business revenue
3,000 1,400 1,280 300
1200 1,180
2,435 240
2,500 2,259 250
1000 1,050
2,000
824 200
743
(SAR million)
(SAR million)
(SAR million)
800
(SAR million)
1,500 700 150
600
1,000 100
400
350
500 200 50
7
0 0 0 0
H1 2015 H1 2016 H1 2015 H1 2016 H1 2015 H1 2016 H1 2015 H1 2016
Net revenue from government sector Net revenue from corporate sector Net revenue from retail sector Net revenue from retail sector
Performance of government Corporate revenue declined
Retail sales declined due to Online businesses have started
sector is impacted by reflecting the economic
lower consumers spending to contribute in the top line
government austerity measure slowdown
4
ATG financial performance showed decline in revenue due to
economic slowdown
Highlights of the income statement
In SAR million Q2 2016 Q2 2015 H1 2016 H1 2015 Comments
Revenue 2,214 2,387 4,183 4,539 • ATG top line declined of about -7%, from core ticketing
segment -15%, however tourism &
COGS (1,741) (1,841) (3,332) (3,553) transportations/others revenue grew by 37% & 19%
respectively due to contribution from e-commerce
GP 473 545 850 987
business and that is mainly from Almosafer along with
GPM 21% 23% 20% 22% Hanay car rental.
Selling exp (61) (71) (126) (136) • Gross margin declined to 21% with +/- 1% fluctuation
which is considered normal in the business, given that
Admin exp (94) (91) (192) (183) the contribution from government sector is less.
Other operating income 51 42 77 61 • Selling expenses decreased compared to last year, as
a result of cost rationalization plan, however
Other income (expense) (21) (3) (36) (8) administrative expenses grew by 4% that is mainly
EBIT 321 410 534 711 due to payroll of newly acquired company during 2015.
• Other operating income mainly consist of incentives
EBIT margin 14% 17% 13% 16%
received from airlines and GDSs (i.e. Amadeus,
Interest (8) (3) (18) (6) Galileo)
zakat (10) (10) (20) (21) • Net profit declined for the period of about -24% but the
Normalized net profit decline is -17% after excluding
Minority (3) (1) (3) (3) the impact impairment loss recorded on equity
investment and impairment loss on intangible assets.
Net income 300 396 494 681
Net income margin 14% 17% 12% 15%
Ticketing business declined as a main contributor to the top line while tourism and transportation grew because
of newly acquired company in 2015 and especially e-commerce initiatives
5
Transportation segment contributed positive performance
driven by acquisition in 2015
Net revenue by business segment Comments/outlook
5,000 151 182
• Ticketing currently contributes close to
27 85
4,000 89 76% of ATG’s net revenue
73
(SAR million)
3,000 • The contribution from the hospitality
segment, primarily in Makkah, is expected
2,000 4,304 3,911
3,669 to start 2016
1,000
0
H1 2014 H1 2015 H1 2016
Travel and tourism services Cargo Transportation and others
Net revenue by client Comments/outlook
5,000 82
• Revenues from government declined by -
77
4,000 79 1,198 7%, whereas revenues from corporate and
1,103
(SAR million)
846 retail clients declined by -10% and -8%
3,000 824
655 743 respectively
2,000
• ATG is looking to increase its market
1,000 2,159 2,435 2,259 share in the retail segment
0
H1 2014 H1 2015 H1 2016
Govt Corporates Retail Travel agency
Ticketing services contribution is lower on yearly basis because of government austerity measures in favor of
tourism and transportation as online business and acquisitions in 2015 started to perform
6
The successful closing of Thakher acquisition has
significantly increased the total assets and equity
Highlights of ATG balance sheet
Assets Liabilities and shareholders equity
10,500
9,449 9,449
9,000 654
8,421 Cash and Accrued
1,762
bank 1031 liabilities
7,500 463 Trade payables
6,201 Trade
1,168
receivable Other liabilities
623 Pre 2,030
6,000 5,474 Bank debts
payment &
other assets 33
Minority interest
4,500
3,000 5,896 Fixed
5,238 Shareholder’s
assets
equity
1,500
0
2013 2014 2015 H1 2016 H1 2016
The vast majority of ATG’s assets are in working capital related to its core operations of ticketing
and more importantly to its investments in the hospitality segment in Makkah
7
Cash flow has been impacted significantly due to economic
condition
Highlights of cash flow statement
In SAR million 2013 2014 2015 H1 2015 H1 2016 Comments
Net profit for the year 943 1,119 1,162 681 494 • During H1 2016 most of
corporates/government
clients utilized the
Cash from change in working capital 1,214 44 332 (446) (1,056) advances resulting in
negative cash flow from
Net Cash flow from operating activities 2,157 1,163 1,493 235 (571) operating activities
• The majority of
Cash flow used in investing activities (net) (370) (735) (2,422) (1,644) (235) investments is related to
the acquisition of the
Wadi.com and
Cash flow from financing activities 26 (42) 984 1,144 570 capitalization of Kenzi
hotel
Dividend paid (443) (545) (5) - -
Increase/decrease in cash 1,370 (158) 50 (265) (236)
Cash at beginning 747 2,117 1,959 1,959 2,009
Cash in hand 2,117 1,959 2009 1,680 1,762
Increase in working capital requirements attributed to the austerity measures
8
Section 2 Update on hospitality projects
ATG has invested on a well located projects to complete its
vertical integration strategy
ATG developed and acquired different hospitality properties to fuel growth
Tower Name Prince Majed Rd Hotel Movenipick City star Hotel Sheraton Hotel
Property use Hotel Hotel Hotel
Location Prince Majed Rd, Jeddah Madina Rd, Jeddah In front of Holy mosque, Makkah
No. of rooms/suits 200 228 422
Expected operating income p.a (SAR mn) 20 25 90
Expected delivery Q4 2017 Delivered Q3 2016
Expected market value (SAR mn) 200 260 1,800
Prince Majed Rd Hotel Movenpick City Star Hotel Sheraton Hotel
10Muthmerah is a leading real estate developer and owner in
Makkah
Muthmerah has developed residential and commercial towers
Albawaba Sheabquresh
Tower Name 3rd Ring Road Masafi Hotel Beer Balela
1&2 Hotel
Property use Offices Hotel Hotel Retail Hotel
Distance from Haram 4 KM 0.3KM 0.3KM NA 0.45KM
No of rooms (residential) / GLA
31,300 sqm 192 547 8,298 sqm 491
(office and retail)
Expected Rental income p.a (SAR mn) 20 9 28 3 20
Expected delivery Delivered Delivered Delivered Delivered Q1 2017
Expected market value (SAR mn) 350 160 550 33 350
3rd Ring Road Masafi Hotel Beer Balela Hotel Al Bawaba Shebalquresh
Note: Muthmerah owns 3 parcels of land that have been under compulsory purchase order by the government which their book value is over SAR 410 million
11Section 3 Update on E-commerce businesses
Almosafer is a locally grown hotel booking tool offering more than
500,000 hotels around the globe through Mobile Tablet apps
Website Mobile App Call Center
Sales
Channels
2015 2016
200.0 101% 123% 140%
92%
65% 100%
150.0 124.0
25% 60%
100.0 -8% 20%
SAR million
Growth (%)
Financial 55.6
performance 31.4 -20%
50.0 19.0 29.0
9.5 -60%
0.0 -100%
Q1 Q2 Q3 Q4 Q1 Q2
Sales (Millions) QOQ Growth (%)
500K 150+ 123% SAR124M SAR300M First Arabic
Hotel around Employee Sales growth Total sales Annualized mobile app for
the globe in Q2 2016 in Q2 2016 sales in 2016 hotel booking
13ATG has launched Tajawal as its latest OTA platform from its
technology hub
Tajawal reflects the latest global developments and insights and is showing strong growth in first few months
14Wadi has quickly emerged as one of the strongest e-commerce
marketplace platform in the region…
3rd largest by run-rate GMV @ USD 50+ 2nd largest player by catalog size with
One of the most diverse catalogs offered
million 150k+ skus
by any player
Estimated 12 month GMV, USD mn1 Catalog size, # skus
Dedicated fashion
170,456 property. Several new
450-500 categories added –
150,000 automotive, home,
sports, home and
kitchen
250-300
46,714
Exclusive launches
with Infinix Note 2 and
36,452 xtouch
50-60
29,728 Well recognized
marketing properties
40-50 (Flash Sale and Best
17,949 Price Guarantee)
15,354
15-25
8,634
500+ suppliers 25+ categories 2,000+ international brands 1.6+ mn sessions/ month
15… and is becoming well recognized brand in the market
# 1 ranking lifestyle app in both KSA and Increasing number of repeat customers
Strong followership on social media
UAE every quarter
Share of repeat customers
345 % of GMV
337 29
23
17
299
52
Q2 Q3 Q4
Highest number of followers on twitter,
net 125K followers added in just 2 months
Bounce rate (% of visitors
Strong followership on Instagram (~20k leaving without any activity on
followers) and Facebook (~90k followers) site) at industry-best levels of
26.5%
Wadi's App install base has grown 3X from 69k
to 210k from Nov to Jan
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