Corporate Update Mark O'Neil - CEO | Dealertrack Technologies
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Corporate Update
Mark O’Neil
CEO | Dealertrack Technologies
Copyright © 2015 Dealertrack, Inc. All rights reserved. 1Deliver the market leading suite of integrated
technologies capable of transforming
automotive retailing… globally.
2015+
2014 Global expansion.
Provided our clients with
2007 the power to transform
automotive retail.
Offered end-to-end
2001 tools to drive
efficiency.
Revolutionized
1999 automotive
credit.
Elevate the role of
digital in car buying.
CopyrightDealertrack,
©2015 Inc. Inc. All rights reserved.
© 2015 Dealertrack, 2Who Are We Doing it For?
Dealers
Shoppers OEMs
Lenders/Partners
Copyright © 2015 Dealertrack, Inc. All rights reserved. 3We Have Unique Capabilities To Enable Change
20,600+ 20+ OEMs
4,500+
Connecting Dealerships with 1,500+ over
Team members
in 90+
94%+ of U.S. Countries
franchise dealers Lenders worldwide
“Touching” Generating
3 of 4 100M+ $1B+
supporting and Transactions and
Cars sold in the In Expected
U.S. and Canada Annually 2015 Revenue
Managing
“Insight into”
45M+ 41M+
Unique visitors /
Financed Titles
1 out of 4 Investing
hosting month on and and Buy/Sell Lists by $175M+
13,000+ 3M+ & 5M+ In R&D / IDS
Dealer Websites Vehicles Inventory Listings
Transported
Copyright © 2015 Dealertrack, Inc. All rights reserved. 4Strong Growth.
$1,000.00 150.00
Annual Revenue $854.40
($ and Transactions in Millions)
$800.00
$175.00
120.00
119.40
$600.00 $481.50
$388.80 $22.90 $332.60
$18.70 101.90
$400.00
90.00
87.80 $276.90
$200.00 $225.00
$346.80
$145.10 $181.70
$0.00 60.00
2012 2013 2014
Subscription Revenue Transaction Revenue Advertising and Other Revenue Number of Transactions
Copyright © 2015 Dealertrack, Inc. All rights reserved. 5Strong Adj. EBITDA and Cash Flow Trends
Annual Adj. EBITDA and Margin Annual Cash Flow from Operations
($ in millions) ($ in millions)
$193
$200 40% $100 $134* 50%
$82
$80 $71 40%
$150 $118 35% $65
$86 $97 $60 30%
$100 30%
$40 $30 20%
25% 24%
$50 24% 25%
23% $20 18% 18% 17% 10%
$0 20% $0 0%
2011 2012 2013 4%
2014
2011 2012 2013 2014
Adj. EBITDA Adj. EBITDA Margin Cash Flow from Operations Operating Cash Flow Margin
Quarterly Adj. EBITDA and Margin Annual Adjusted Net Income
($ in millions) ($ in millions)
$60 $57 60%
$55 $100
$50 $82
$45 $40 45% $75
$33 $33 $59
$28 $31 $49
$24 $43
$30 30% $50
27% 26% 24%
$15 22% 22% 23% 15% $25
22% 19%
16%
$0 0% $0
1Q'13 2Q'13 3Q'13 4Q'13 1Q'14 2Q'14 3Q'14 4Q'14 1Q'15 2011 2012 2013 2014
Adj. EBITDA Adj. EBITDA Margin
* After adjusting for the impact of acquisition and acquisition-related costs.
Copyright © 2015 Dealertrack, Inc. All rights reserved. 6We Believe Technology is Transformative.
Today Transformed
Controlled Self Directed
Dealerships Driving the Process Personalized Shopping Experience
Tedious Fast
3 to 4 Hours in the Dealership Process is Measured in Minutes Not Hours
Rigid/Profitable Flexible/Profitable
Limited Options Transparent and Predictable
Uncomfortable Enjoyable
Unpleasant Interactions and Negotiation Building and Strengthening Relationships
Copyright © 2015 Dealertrack, Inc. All rights reserved. 7How will Dealer Operations Evolve?
Key Predicted Changes
– Increase in technology reliance; less
staffing required.
– SFI roles merge.
1 – Functions centralized (e.g. Inventory).
– Fixed Ops investment on the rise. 4 – Increasing data security demands.
– Need for technical competence/team
increases.
– More data driven decision making.
– Increased use of kiosk/mobile.
– Rise of dealer group brand.
2 – Price transparency and simplification.
– Margin compression. 5 – Rise of digital retailing.
– Connected car increases dealer
engagement (CRM).
– OEM pressure to improve in-store – Dramatic increase in used supply.
3 process.
– Consumer pressure to shorten process.
– Focus on customer loyalty/retention.
Copyright © 2015 Dealertrack, Inc. All rights reserved. 8
6 – Emergence of uber used car dealer.
– Technology drives shorter ownership
lifecycle.Anticipated Changes in Indirect Auto Lending-2018
Stakeholders Anticipated changes
• Expanded use of online, as well as in-store wireless and tablet
Dealers • Extend retail financing workflows directly to consumers
• Consolidation/integration around major dealer players
• Softer automotive demand from Millennials
Consumers
• Social and peer-to-peer lending
• Increased OEM-branded online to in-store technology and integration
OEMs • Provide customers with demonstrated time savings in-store, for
increased CSI, & consistent consumer experience
• Integration of digital retailing and CRM tools
Lenders
• Leverage digital properties for direct or direct to indirect lending
• Direct to Consumer portals expand
Competitors
o TrueCar
Regulation • Level of scrutiny on indirect auto and across F&I likely to rise
Copyright © 2015 Dealertrack, Inc. All rights reserved. 9Outlook for Lenders
Healthy Market (Steady SAAR) Regulations & Enforcement
Online Opportunities Increased Lender Competition
• Direct and Direct to Indirect • Peer to Peer
New Dealer/Lender Workflow Innovations Speed of Change
• Digital Contracting and DDS Hybrid
• Accelerated Title
• Mobility
• More insight & analytics
Copyright © 2015 Dealertrack, Inc. All rights reserved. 10Innovation Through Integration
Title
Originations Contracting Management
Copyright © 2015 Dealertrack, Inc. All rights reserved. 11You can also read
