LiquidCapital in Perspective  

1  

Agenda  

- LiquidCapital corporate video

- Our business in quantum

- What we do

- Key financial indicators

- Questions

 

2  

Business in quantum  

3  

Our Business  

- We offer a broad range of financial products and services to the motor industry,

corporate customers, leasing ventures and the South African motoring public

- We are a registered Financial Services Provider

- We are a level 3 BEE contributor  

4  

Our Business in Quantum  

- We are the largest provider of branded financial services solutions in the motor

industry

- We are believed to be the 2nd largest provider of contract maintenance in the

country

- We provide a range of vehicle products and services for over 13 international motor brands represented in South Africa

 

5  

Our Business in Quantum  

- We have over 560,000 active customers on our books

- We manage over 1,072,000 policies (active and future active)

- We administer and manage a fleet of over 11,000 vehicles

- We receive and make more than 110,000 in and outbound calls per month

- We also make more than 100,000 customer satisfaction research calls per month

contract maintenance authorizations

per month amounting to R55 million

35,000 - We process more than

6  

Our Credo  

7  

What we do?  

8  

The Motor Industry Financial Services Model  

9  

Finance  

Strategy !  Alliances - MFC and WesBank

!  Liquid Vehicle Finance (a joint initiative between LiquidCapital and WesBank) launched 2009

!  Branded finance solutions

Finance and Insurance Management Solutions (FAIMS) !  Over 180 F&I Business Managers

!  Solution tailored for over 350 dealer outlets

10  

Value added vehicle products  

- Contract maintenance - Service Plans and Maintenance Plans

- Vehicle profiling & plan pricing

- Quoting calculator

- Authorisations/Claims

- Warranties - Manufacturer and extended warranties

 

- Other insurance products - Paint protection, deposit cover & gap cover

- Roadside assistance & accident management - Believed to be the 2nd largest provider in SA

- Tracking devices and on board telematics

- Relationships with numerous major players

 

11  

Product White Labeling

12  

Branded Fulfilment

Branded  fulfilment  –  founda0on  to  launch  customer  communica0on  journey  

Kia Hyundai Kawasaki Mitsubishi LiquidCapital Triumph

13  

Insurance  

- Insurance aggregator business - Support all AMH dealerships

- Support all Imperial Automotive Retail dealerships

- Sell direct to consumer

- Comprehensive insurance quotes - On vehicle, motorcycle & household

- Panel of insurance providers

- Tracking devices offered

- Integration into accident management process

 

14  

Accident Management  

Customer obtains insurance through Liquid Insurance

Quotes

 

Customer has accident

 

Tracking device give notification of accident

 

Liquid Roadside dispatch tow truck to collect vehicle

 

Tow truck delivers vehicle to our approved panel beater

 

Approved panel beaters only use OEM parts

 

15  

Customer Life Cycle  

Customer takes delivery of vehicle

Sales CSI survey and data hygiene

Telesales initiatives

Service and maintenance plan authorizations

After – sales surveys

Customer relationship

communication

Retention / churn campaigns

16  

One View Of Customer  

-­‐  Advanced  data  warehousing    and  business  intelligence    solu0on,  ensure  -­‐  

-­‐    Enhanced  data  quality  of    customer  and  vehicle    informa0on  

-­‐  Enhanced  business  insight    and  customer  centricity    

-­‐  Ability  to  profile  and    predict  behaviour  of    motoring  customers    

 Automated Direct Marketing Engine

17  

Data Warehouse  

Business  intelligence      - Vehicle, customer & fleet behaviour

- Provide enhanced ability for analysis  and  repor0ng  

Customer Age   Marital Status/Gender  Gender  

Gender/Age  

18  

Customer Journey  

19  

Customer Experience Management  

-­‐    Exceeding  customer  expectaEons  

-­‐  ImplemenEng  “tomorrow’s  technology”  via    -­‐  Responsive  website  &  email  designs  -­‐  Customer  apps  -­‐  Automated  customer              communicaEon  

 

MOBILE  APP  

CUSTOMER  COMMUNICATION  

PC  WEBSITE  

TABLET  

MOBILE  

20  

Responsive Design Website  

-  Responsive CSS Framework -  Multiple browser and device

compatibility -  Sophisticated coding employed

to support cross device functionality

21  

Google Partnership  

-  Relationship with Google, which allow -  testing various beta products -  as soon as they are available

-  Dedicated test account in which we are

currently testing: -  different display targeting

combinations -  remarketing lists for search ads

22  

Website Tracking  

- Monitoring of –

- Active customers

- Website activity

- Demographics (age/gender)

23  

Analytics Tracking  

- Website visitors by geographic area

24  

- Tracking -  Opening Rates -  Link Tracking via Heat maps

 

Email Automation  

25  

Email Automation  

Inbox analytics: Email Clients used to read emails

Inbox analytics: Engagement Rates - Read - Skimmed - Glanced/ Deleted

26  

Mobile app  

-  Customer raise request for roadside assistance through app

-  App automatically identifies the customer’s geo location and communicates to call centre

-  Various services offered –

-  Roadside services

-  Route map assistance

-  Accident logger

 

27  

CSI

Research      - Customer satisfaction – sales, service and data hygiene

- Call centre specialising in - Sales CSI - Aftersales CSI - Parts surveys - Other ad hoc surveys

- CATI (by NIPO) “Computer Assisted Telephonic Interviewing” software

used – similar platform used as leading research houses (i.e. Markinor &

IPSOS)

28  

Other Support Services

- Customer care

- Website hosting and support

- Marketing material

- Training

- Compliance, validations & quality control

 

29  

Fleet Management

Products & services offered:

- Leasing & rentals

- Fines management

- Vehicle licensing & registration

- Accident management

- Roadside assistance

- Managed maintenance

- General vehicle maintenance, tyres, glass, etc

  30  

Fleet Management

Ability to manage diverse fleet ranging from:

- Passenger vehicles

- Light commercial vehicles

- Heavy commercial vehicles

- Forklifts

- Armoured vehicles

 

31  

Fleet Management - Clients

Some of our clients:

 

32  

Our Roadmap  

Ariva

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2001

MFC JV

Demo Plan

IFM Telesales

Service & Maintenance

Plans

CSI

Roadside Assistance

Liquid Vehicle Finance

LiquidCover

360PLUS

Direct Marketing

2014

33  

Key financial indicators  

34  

Funds Under Management  

Funds under management - LiquidCapital

Funds under management – Cell Captive (after dividends)

FUNDS

GROWTH

2009

Base

Base

2010

+203%

2011

+2%

2012

+25%

2013

-

+38.4% +37.0% +36.0% +22.5%

2014 H1

+10%

+7.0%

35  

Base +29% +45% +37%* +26% +7%

* Change in estimate in respect of revenue recognition

Forex Exposure  

36  

-  Only a portion of the funds under management are exposed to

currency fluctuations

-  Forex exposure is managed through:

-  Changes to assumptions in the actuarial valuation model

-  Re-pricing of plans

-  Ongoing negotiations around parts pricing

Revenue Income Contribution  

- Revenue analysis for the half year ended Dec 2013

42%

19%

21%

8%

4% 2% 1% 3%

Fund revenue Fleet Services Motor Finance Alliances Cell Captive Liquid Direct Liquid Cover Liquid CSI Tracking Devices

37  

Finance Alliance Books  

TOTAL

GROWTH

2009 R’m

8 975

2010 R’m

7 316

2011 R’m

10 287

2012 R’m

14 499

2013 R’m

18 795

2014 H1

R’m

-18% +41% +41% +30%

BOOKS

21 663

+15%

38  

R-

R5 000 000,00

R10 000 000,00

R15 000 000,00

R20 000 000,00

R25 000 000,00

2 009 2 010 2 011 2 012 2 013 2013 (YTD Dec)

Telesales  

- Total Monthly Telesales increased by 303% over last 5 years

500

1000

1500

2000

2500

3000

3500

4000

4500

Dec-2009 Jun-2010 Dec-2010 Jun-2011 Dec-2011 Jun-2012 Dec-2012 Jun-2013 Dec-2013

Total Monthly Sales Linear (Total Monthly Sales)

39  

Direct Marketing

- Growth in direct marketing

 

40  

0

500

1000

1500

2000

2500

3000

3500

4000

0

200

400

600

800

1000

1200

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb

2012 2013 2014

Leads Sales Actual

AMH Dealership Sales  

Total AMH vehicle sales vs Total value added product (VAP) sales in AMH dealerships

41  

0

2000

4000

6000

8000

10000

12000

14000

Jan-2009 Jul-2009 Jan-2010 Jul-2010 Jan-2011 Jul-2011 Jan-2012 Jul-2012 Jan-2013 Jul-2013 Jan-2014

Total Vehicle Sales Total VAP Sales

Independent Dealership Sales  

Total value added product (VAP) sales in Independent dealerships

- Focus: Service & Maintenance Plans, Extended Warranties

0

200

400

600

800

1000

1200

1400

1600

Jan-2010 Jul-2010 Jan-2011 Jul-2011 Jan-2012 Jul-2012 Jan-2013 Jul-2013 Jan-2014

Total VAP Sales Linear (Total VAP Sales)

42  

Sustainability Of Earnings  

Average contract duration increased from 2.92 years to 4.25 years Average term of vehicle on book increased from 15 months to 21 months (last 7 years)

43  

10

12

14

16

18

20

22

25

30

35

40

45

50

55

Dec-07 Dec-08 Dec-09 Dec-10 Dec-11 Dec-12 Dec-13

Average contract duration Average age of parc

Mon

ths  

* Calculated on Service & Maintenance Plans  

Sustainability Begins at Home  

44  

-  Outstanding customer service is central to our business

-  Our employees are the key differentiator in achieving superior business results -  LiquidCapital invest in training and upskilling our people -  Employee wellness program

- LiquidCapital ensures compliance with all legislative requirements through:

- customer call validation

- quarterly sales script reviews

- daily live auditing on all sales calls (BYC)

- annual compliance reports submitted to FSB

Results

- only 1 Ombud complaint in the past 2 years

- No negative findings or fines levied against LiquidCapital ever

BCG Matrix - Products  

45  

Service  and  Maintenance  

Plans  

Warranty  

Roadside  Assistance  

Warranty  PlaEnum  Plus  

Tyre  &  Rim  

Tyre  Maintenance  

Plan  

Service  Plan  Plus  

Mar

ket

Gro

wth

Rat

e  

Low  

Hig

h  

Market Share  Low   High  

BCG Matrix - Channel  

46  

Pre-­‐paid  (wholesale)  

AMH  Dealer  Floor  

Telesales  Website  

Direct  MarkeEng  

360PLUS  

Non-­‐Motor  Financial  Services  

Mar

ket

Gro

wth

Rat

e  

Low  

Hig

h  

Market Share  Low   High  

Branded  Independent  Dealer  floor  

Conclusion  

- Business well positioned for growth

- Diversification of revenue streams

- Development of new sales channels

- Investment in technology, innovation and entrepreneurship

- Aggressive management of business risks

- Leveraging efficiencies throughout the business and the Group

 

47  

Thank you

48