AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 AP Eagers Limited Investor Presentation: 3 April 2019 1 THE NEXT 100: Providing integrated mobility solutions for the next 100 years. OPTIMISE DEVELOP GROW 1 2 3 4 5 Deliver optimised Engage our customers, Redefine Reinvest vehicle finance Support innovation everywhere our workforce with discipline solutions EXCEED STAKEHOLDER EXPECTATIONS Customers. Employees. Partners. Shareholders. Community. 2 Page 1 of 15 Page 1 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 APE Credentials Consistent record of profit, dividend and EPS growth Net profit after tax ($m ) Earnings per share (cents per share) 10 year total shareholder return on Dividends (cents per share) $1,000 investment at 1 April 2019 $8,212 3 How do retail dealerships work? 4 Page 2 of 15 Page 2 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 THE NEXT 100: Providing integrated mobility solutions for the next 100 years. OPTIMISE DEVELOP GROW 1 2 3 4 5 Deliver optimised Engage our customers, Redefine Reinvest vehicle finance Support innovation everywhere our workforce with discipline solutions EXCEED STAKEHOLDER EXPECTATIONS Customers. Employees. Partners. Shareholders. Community. 5 Strategy Overview • Continue to outperform industry: solid foundations, disciplined approach, multi-profit drivers • Future growth strategy underpinned by: • Engaging our customers, everywhere . Leveraging our flexible property portfolio to continue development of an omni-channel retail approach via our future dealerships retailing networks; • Redefine our workforce to deliver a vastly superior customer experience on a more sustainable and productive cost base; • Deliver optimised vehicle finance solutions by executing on our five point Finance Operating Plan; • Supporting innovation as our partners introduce ACE (autonomous, connected & electric) and other emerging product and service innovations; and • Reinvest with discipline , combined with rigorous review of existing & new operations to support an unrelenting focus on long term wealth creation • Exceed expectations and deliver balanced long term value for our stakeholders • Take advantage of industry opportunities as consolidation, restructuring, rationalisation escalates 6 Page 3 of 15 Page 3 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Engage our customers, everywhere 7 Automotive Retail of the Future Adapting our model to support the customer and the company 8 Page 4 of 15 Page 4 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Automotive Retail of the Future Providing choice and convenience 9 Automotive Retail of the Future A unique and compelling experience with unrivalled choice 10 Page 5 of 15 Page 5 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Automotive Retail of the Future A Blended Network approach supporting Customer Centricity 11 Taking Automotive Retail to our customers 12 Page 6 of 15 Page 6 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Taking Automotive Retail to our customers 13 Multi-brand service hubs Multi-Branded Express Service Ex-Bunnings facility in Albion acquired to support inner-city transition to Airport as well as neighboring sales locations Shopping Centre Service Scheduled and Express servicing on demand to support customer’s existing shopping patterns 14 Page 7 of 15 Page 7 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Using property to drive workforce transformation 15 Redefine our workforce 16 Page 8 of 15 Page 8 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Carzoos is our proof of concept 17 A workforce designed by our customers Google case study on today’s car buyer 18 Page 9 of 15 Page 9 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Carzoos feedback refined our plans… 19 Business Transformation is underway 20 Page 10 of 15 Page 10 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 - Lean (3 Step) “Superiorguest experience on a lower cost base .” 1. Finscore 2. Sales Model 3. Remuneration • Implement sales quoting • Design & implement a “Pilot” sales POD • Balanced BFSPR remuneration • Present complimentary • Select the best to fill the positions payment approach • Recruit new “Product Specialist” role • Reward more for Buy, Fund, Protect personal credit score • Adopt panel lender approach • Formalise the reduced cost base –less on Sell • Measure results • KPI’s set for the POD • Stress test commission model • Communicate to all teams • Income pooling for POD • Support & promote the model • Observe notice periods for changes 21 Deliver optimised vehicle finance solutions 22 Page 11 of 15 Page 11 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Risk Based Pricing will drive penetration Achieving 80% penetration will significantly increase finance income on 2018 LFL vehicle sales…will be achieved subject to planning and execution strategy • Penetration rates driven by a combination of RBP arrangements; Guaranteed Future Value (GFV) product development; and continued low rate finance campaigns (LRC) • Implementing strategic plan to achieve long term objective of 80% that will significantly increase finance income on 2018 comparable vehicle sales • Targeting 50% penetration rate by end of 2019 23 Support innovation 24 Page 12 of 15 Page 12 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 OEMs pile into BEV Battery Electric Vehicles 25 Quantifying the likely rate of change The Australian car parc was 19.2m registered cars as at 31 January 2018 26 Page 13 of 15 Page 13 of 15
AP Eagers Limited - Merger Authorisation Application Annex 11.1 Investor presentation - 3 April 2019 Reinvest with discipline 27 Active portfolio management and disciplined re-investment 2016 Acquisitions Birrell Motors Group Ipswich Jeep & Kia Crampton 2017 Automotive Group Acquisitions 2018 Tony Ireland Group Crash Supplies Acquisitions 120 Porsche Centre 2014 Metro Nissan Disciplined Acquisitions Greenfields Sites Adelaide Acquisitions Grand Nissan Carzoos first store Ian Boettcher Motors Toowoomba Motor 2015 Greenfields Sites Volvo Sunshine Coast Group Acquisitions Fuso Hallam Black Group Auto Advantage 2013 Greenfields Sites Acquisitions 100 Reynella Subaru Main North & Unley Kedron Subaru Nissan & Renault 2011 2012 2016 2017 Greenfields Sites Acquisitions AHG Initial Strategic Divestments Restructure provision Northern Beaches Eblen Subaru Investment Net profit after tax ($M) Ipswich Jeep Jaguar Land Rover Divestments 80 Greenfields Sites Greenfields Sites Sydney Truck Centre Daimler Benz Infiniti Centre Brisbane Motor Adelaide Brisbane Auctions 2015 Infiniti Centre Divestments 2010 Brisbane Western Equipment Acquisitions Rentals Caloundra City Autos 2014 2018 60 Divestments AHG dividend Adtrans Limited Eagers Mitsubishi reduced Western Star Trucks Divestments 2013 Sydney Surfers City Holden Divestments Austral Volvo Hidden Valley Ford 40 Eagers Kia 2011 Divestments City Peugeot Organic Growth Bill Buckle Audi FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 RUTHLESS RIGOROUS DISCIPLINED 28 Page 14 of 15 Page 14 of 15
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