Autotrader Group Plc

Good morning, everyone, and welcome to Autotrader's results for the six month ending 30th of September 2025. I'm joined by our COO, Catherine, and our CFO, Jamie, who will both be presenting and joining me for Q&A. You will have seen the announcement regarding Catherine moving on to become CEO at Moonpeak. We're very pleased for Catherine and wish her the best as she embarks on the next chapter of her career. Catherine has been a pleasure to work with and has had a real impact at AutoTrader. She will be missed, but she leaves behind a strong team with bench strength that is both broad and deep, so we have little worry that we'll carry on uninterrupted. Our disproportionate focus on internal development over external hiring serves us well at times like this. Catherine is still with us for some time, and we will announce her leaving date in due course once we have worked to a smooth transition plan. Now on to the results. Overall, we are pleased with the progress that we've made through the period. Our profit was marginally ahead of expectations, and we've made significant progress against our strategic priorities. As expected, we've been impacted by the fast speed of sale of vehicles, but the team has delivered well on those areas that are within our control. I'm confident that the actions we are taking today will underpin growth for many years to come. Our market position remains strong, with record levels of buyers and retailers using AutoTrader. As we saw last year, there has been a further increase in the number of unique vehicles advertised on our platform and high levels of engagement with those vehicles. This underpins our core proposition for buyers as we provide full choice and transparency and clearly retailers have benefited from more vehicles moving through a similar number of advertising slots. Our annual product and pricing event in April this year went well, underpinned by the first features under our co-driver AI umbrella. There is significant future potential in this area as we make more AI-powered solutions available and accessible to both retailers and car buyers. We're uniquely placed to do this due to our strong brand, deep integrations with the industry and our real-time proprietary data. The first features of CoDriver have seen strong engagement with over 10,000 retailers already using the tools. It is important to note that AI doesn't just enable us to increase the richness of the car buying experience on AutoTrader, but it does extend the opportunity across all our retailer product areas, which includes advertising, data, digital retailing, and now co-driver. We've also dramatically accelerated the adoption of DealBuilder, growing customers, stock, and deals since our change in approach earlier in the year. DealBuilder will no longer be an optional add-on product available on a selection of cars. It will be the default experience for retailers and car buyers on AutoTrader. Catherine will cover this in more detail later. With a car market that will grow over the long term, a strong market position, we're comfortable that we can continue to grow through delivering meaningful improvements to the buying and retailing of cars in the UK. AutoTrader has never been short of growth opportunities, which remains as true today as it has ever been. I wanted to thank everyone at Autotrader and our customers, shareholders and wider stakeholders for their continued trust and support. We'll start with some of the highlights during the period. Group revenue grew 5%, operating profit grew 6% and basic EPS grew double digit at 11%. Our largest revenue area, retailer revenue, grew at 6%. This was made up of strong forecourt numbers and a 5% increase, in ARPA, mostly driven by the price and product event in April 2025. AI has been a big focus for many investors recently, given its potential to significantly alter consumers' online behaviours. I'll speak to this in more detail later. However, we're confident that on any platform, we're well-placed to provide the best car buying experience for users. The transaction is high-value, complex, and occurs over a three-month period, not one session. The reasons car buyers choose AutoTrader come from our singular focus on the UK, our category-defining brand, well-invested technology and the rich tools we provide both car buyers and retailers, which are all made possible by real-time data at a vehicle level that only we have access to. These unique characteristics are why our market position has been not only maintained but but strengthened when new platforms have emerged, such as Google, iOS, and Android. Now to DealBuilder. I am very proud and pleased with the progress that we've made since we changed our approach midway through the year on DealBuilder. Adoption has dramatically accelerated as we make this journey the default experience on AutoTrader. We've added four times as many retailers this half than we did in the previous six months. We know from years of development and live testing that DealBuilder deepens our engagement in car buying and selling. It delivers better conversion for retailers and a more connected and empowered journey for time poor car buyers who want to do more online when it suits them with a brand they trust. At our full year results in May, we presented this slide for the first time to better show how market dynamics not previously seen before had impacted our financial results. We have four charts here, which I don't intend on going through in great detail, but it is a picture of a more stable market. The key points to note are last year, demand or visits were strong. Supply was constrained. Used car prices had come down. which all resulted in an acceleration in speed of sale. This meant more unique vehicles sold through roughly the same number of slots, which doesn't benefit our business model. This year, however, demand does remain healthy. Supply is gradually coming back and used car prices have been robust, even increasing from the levels seen last year. As a result, speed of sale has not accelerated as it did last year, so the headwinds we were facing have subsided somewhat. However, we would caution too much optimism in the near term, as speed of sale was still one day quicker in October. I'll briefly cover the financial results, which Jamie will cover in more detail next. Group revenue increased by 5%, with core auto trader revenue also increasing by 5%. Group operating profit increased by 6%. Auto trader operating profit increased by 5% to £208 million. And Autorama halved its operating losses to £1.4 million. Non-cash acquisition-related costs were £6.5 million. Group operating profit margin increased to 63% and auto traders operating profit margin remained at 70%. Basic EPS, as mentioned earlier, grew double digit at 11% and cash generated from operations was up 7%. We returned £162.2 million of cash to shareholders through £100.2 million in share buybacks and £62 million in dividends. Finally, we are declaring an interim dividend of 3.8 pence per share. Now onto our operational results. The average number of cross-platform visits was up 1% to 83.3 million per month. And we continue to account for over 75% of all time spent across our main competitor set. The average number of retailer forecourts advertising with us was up 1% to 14,080. Average revenue per retailer was up 5% to 2,994 pounds, mainly due to our product and pricing event implemented on the 1st of April, 2025, which was underpinned by co-driver. Live car stock was up 2% to 457,000, with this increase being due to an offer which ran at the beginning of the six-month period, and we delivered 3,687 new lease vehicles. Finally, the average number of full-time equivalent employees in the group decreased slightly to 1,249. In previous years, we would have covered our cultural KPIs in half-year results. However, we've decided to do this now at each full-year results. The KPIs and initiatives that sit behind them remain as important as they've always been. However, covering them annually better aligns with our annual employee survey. The KPIs on gender, ethnicity and GHG emissions are all included in the press release and the appendix of this presentation. As it relates to culture, it is worth noting that we have entered a new lease and are halfway through investing significant capital in a new home campus for auto trader, which will provide a great environment for our people to do their very best work in a space that facilitates both how we work and the other elements of our culture. I'll now hand over to Jamie to talk us through the financials in more detail.

Thanks, Nathan, and good morning, everyone.

I'll start by focusing on the core auto trader financials. Starting with revenue, total auto trader revenue increased 5% to 296.3 million. Trade revenue increased by 6%, with the largest component of this being retailer revenue, which also grew by 6%. Also within trade revenue, we've seen an increase in both home trader and other trade revenue. Consumer services revenue decreased by 9%. Within this, private revenue generated from individual sellers was down year on year due to a lower number of listings compared to a strong prior year. and motoring services revenue was flat. Revenue from manufacturing agency customers increased 13% year-on-year due to manufacturers supporting their franchise networks on both new and used car advertising. As mentioned, retailer revenue increased 6% year-on-year. The average number of retailer forecourts on our platform increased to 14,080, a 1% year-on-year increase, an average revenue per retailer increased by 5% to £2,994 per month with more detail given on the following slide. Here, the chart on the left shows the components that contribute to the movement in ARPA compared to the prior year. As you can see, ARPA growth was driven by the price and product levers with a small headwind from stock. We delivered our annual pricing event for all customers on 1st April 2025, which included additional products and a like-for-like price increase, which contributed £89 to ARPA growth. Product contributed £64. Most of this growth was from our co-driver product, which was included in retailer advertising packages in April 2025. Prominence, which includes upsell to our higher-level packages, was not a contributor to the product lever in the first half, We continue to review our package staircase and have recently created an offer to incentivize customers onto higher levels, which has had good levels of uptake. This offer converts throughout the second half and will inform how we evolve these packages in H1 of next financial year with the aim of returning prominence to long-term growth. Turning now to stock, you'll see on the right-hand side of the chart that the number of live cars advertised on AutoTrader increased 2% year-on-year. Used car stock also increased by 2%, although much of this was driven by a stock offer which we ran at the beginning of the financial year. Excluding this stock offer and private listings, which do not impact DARPA, the livestock increase was just under 1%. The stock lever was marginally lower due to a slight reduction in underutilized slots which typically occurs when we run this type of offer. Total auto trader costs increased 3% to 90.4 million. Salary costs increased by 6% to 42 million due to higher average salaries and a small increase in the number of auto trader FTEs. Share based payments increased by 1% to 6.9 million. Marketing spend decreased by 21% to 8.9 million due to the timing of campaigns, and we expect a greater level of marketing in the second half of the year. Other costs, which include data services, property-related costs, and other overheads, increased 6% to 22.9 million, primarily due to property costs for our new head office and other IT-related expenses. Depreciation and amortization increased by 31%. Again, related to the cost of our new head office. As a reminder, we fully expense our technology, research and development costs, hence our low levels of CapEx and depreciation. In addition to our investment in cloud-based and AI services, we have around 400 people in product and technology who are continuously improving our platforms and developing new products for consumers and retailers. Operating profit increased by 5% to 208 million during the period, and operating profit margins remained consistent at 70%. Our share of profit generated by dealer auction, the group's joint venture, increased 17% to 2.1 million. Having covered AutoTrader, the main part of the group, we'll briefly cover Autorama results. As a reminder, the Autorama acquisition is part of our strategy to bring attractive new car offers to car buyers on AutoTrader, and to make new cars a more important part of our proposition. Autorama revenue was £21.4 million, with vehicle and accessory sales contributing £16.5 million, and commission and ancillary revenue contributing £4.9 million. Vehicle and accessory revenue relates to vehicles that flow through our balance sheet, which is not our focus for future growth. Total deliveries grew 16% to 3,687 units. As can be seen from the chart, this growth was driven by cars, and importantly, more of that growth was driven by the auto trader platform, which saw a six times increase in delivery volumes. Average commission and ancillary revenue per delivery decreased to £1,329, reflecting the changing vehicle mix during the period. We delivered around 750 vehicles which were temporarily taken on balance sheet, the cost of which was taken through cost of goods sold. This was a year-on-year increase driven by just over 300 extra vans which were taken to support van volumes as they were slightly lower in the third part. Excluding the cost of goods sold, costs of £6.2 million represented a 25% year-on-year reduction with all lines seeing a decrease. The Autorama segment made an operating loss of 1.4 million, which was a significant reduction on last year as a result of the accelerated integration into the main auto trader business and platform. With group revenue up 5% and a reduced Autorama loss, we saw group operating profit increase 6% to 200.1 million and group operating profit margins increase to 63%. As we grow, the strong cash generation of our business leaves us well-placed to return surplus cash to shareholders. Cash generated from operations was at 215.4 million. Now to briefly review net bank debt and capital policy. During the period, the group drew down 15 million of its revolving credit facility and held cash and cash equivalents of 20.2 million. Cash generation operations was largely used to pay tax or return to shareholders through a combination of dividends and share buybacks. The group's long-term capital allocation policy remains unchanged, continuing to invest in the business, enabling it to grow, while returning around one-third of net income to shareholders in the form of dividends. Following these activities, any surplus cash will be used to continue our share buyback programme and to steadily reduce gross indebtedness. That concludes the financials. I'll now hand over to Catherine to talk through progress against our strategic priorities.