Sanford Bernstein Strategic Decisions Conference€¢ Exclusive importer for all vehicles and parts...

Sanford Bernstein Strategic Decisions Conference

2 October 2013

André Lacroix Group Chief Executive

3

Agenda

1) Proven business model and strategy

2) The right markets and channel mix

3) Operational excellence delivery

4) Sustainable earnings growth

4

Global premium automotive group, partner to the world’s leading car brands

Supported by the Right Growth Strategy

Right Markets:70% of profits from

Asia Pacific & EM

30% from UK &

Europe

Right Categories:Five distinct

revenue streams offering growth /

defensive mix

Right Financials:Attractive growth

prospects, strong

cash generation & robust balance sheet

Right Brands:90% of profits

from 6 leading

premium OEMs

5

Inchcape Customer 1st Strategy

STRENGTHEN

Superior customer

value proposition

through Inchcape

Advantage

EXPAND

Selective

investment in high

margin / high

growth areas

Creating an incredible customer

experience for the best car brands in

the world

6

Operational discipline on Top Five Priorities

Balanced focus between commercial and cash initiatives

Customer 1st strategy to create differentiation

Commercial initiatives to grow revenues ahead of

competitors

Cash initiatives to grow profit and operating

cash faster than revenue

Brand portfolio of the world’s leading

premium and luxury automotive brands

Improving margin

Controlling working capital

Selective capital

expenditure

Growing marketshare

Growing aftersales

Where does Inchcapegenerate its returns?

The right marketsand channel mix

8

APAC / Emerging Markets UK / Europe

Reta

il

Hong KongGuamMacauSaipanBruneiSingaporeRomaniaBulgariaMacedonia

AlbaniaEstoniaLithuaniaLatviaAustraliaNew ZealandEthiopiaChilePeru

RussiaChinaPoland

BelgiumLuxembourgGreeceFinland

UK4%

Dis

trib

uti

on

& V

IR

28%

72%

Total

66% 6%

24%

The right markets and channel mix

Note: H1 2013 Trading Profit

30%70%

9

• 72% of Inchcape’s trading profit comes from high quality distribution and vertically integrated operations in 22 small and medium size markets

• 90% of distribution / VIR profit from high growth and high margin APAC and EM regions

• Six core premium & luxury brand partnersToyota, Subaru, BMW, Volkswagen, Mercedes & Jaguar Land Rover

• Top 3 market share positions in 11 markets with scale advantage in all countries

• Defensive profit streams from scale aftersales businesses

• Robust growth prospects in all categories

Premium & luxury automotive distribution in small & medium size markets

10

Attractive distribution / VIR business model

• 22 Distribution & Vertically Integrated Retail (VIR) markets11x VIR11x Distribution

• Exclusive agreements, one distribution agreement per market per brand

• Act as the brand in the country, manage the value chain ex manufacturing

• Exclusive importer for all vehicles and parts

• Responsibility for sales and marketing activities for vehicle distribution

• Distribution of spare parts to all dealers providing aftersales service

• Light fixed capital footprint, high ROCE and strong cash generation

11

Focused on small and medium size markets

22 markets with robust growth characteristics

• Top 10 global auto markets account for 73%* of total new

vehicle demand

• All Inchcape markets

(Distribution and VIR)

outside of the top 10

• Superior management and

operational processes to local competition

• Scale positions in Sales and

Aftersales

* 2012, IHS Automotive

12

Market share strength delivers scale returns

• Top 3 market share position in:

Brunei, Bulgaria, Chile, Ethiopia, Greece, Guam, Hong Kong, Macau, Peru, Saipan, and Singapore

• Long established strong positions

• Strong share in new vehicles drives our pricing power and cost effectiveness

• Scale in the new vehicle segment creates scale in the Car Parc for parts and service activities

13

APAC / Emerging Markets UK / Europe

Reta

il

Hong KongGuamMacauSaipanBruneiSingaporeRomaniaBulgariaMacedonia

AlbaniaEstoniaLithuaniaLatviaAustraliaNew ZealandEthiopiaChilePeru

RussiaChinaPoland

BelgiumLuxembourgGreeceFinland

UK4%

Dis

trib

uti

on

& V

IR

28%

72%

Total

66% 6%

24%

The right markets and channel mix

Note: H1 2013 Trading Profit

14

Selective investment in high quality large retail markets

• UK, China and Russia are amongst the largest premium / luxury automotive markets in the world

• China #2• UK #6• Russia #8

• Excellent UK operations with class leading returns and retail standards

• Strong footprint with world class facilities in Russia positioned to leverage structural growth

• Six luxury retail sites in China

• Operational best practice processes transferred across the Group

• Our established UK business acts as an important source of expertise and strengthens our brand

partner relationships

• UK 24% of Group H1

2013 trading profit

Ranking from IHS Automotive (2012)

How do we generate our returns?

Operationalexcellence delivery

16

Pro forma country operations footprint

Inchcape owned sites (x4)

Dealer sites (x25)

Head office

17

Inchcape core purpose

Creating an incredible customer

experience for the best car brands in

the world

18

Inchcape bespoke operational processes drive superior performance

Market understanding & forecasting

Dealer network development

Performancemanagement

Risk management

Supply management& logistics

World class retailstandards

Capex & investment

Investing in people

Marketing & innovation

Customer serviceInchcape Advantage

Global ITinfrastructure

Rewarding performance

19

UK / EuropeMarket understanding

& forecasting

Dealer network

development


Risk management



Capex & investment

Investing in people


Customer service

Inchcape Advantage



Inchcape bespoke operational processes drive superior performance

20

Inchcape: BMW Chile

* 2009 - 2012

• Distribution business

operated since 1994

• Population 17.4m (6m in Santiago)

• 5.7% 3 year real GDP CAGR*

• Market leader with one of highest

market shares for BMW in the World

• 38% market share of the luxury

segment (2012)

• 38% 3 year BMW volume CAGR*

21

In depth market planning and analysis

• Inchcape strategic plan and annual operational plan to forecast annual volume target

• Detailed model mix / segmentation analysis

• Price agreement per model with BMW

• Market forecast updated every month

• Daily traffic to track demand and update monthly supply forecast


Risk management

Capex & investment

Investing in people




22

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

2003 2005 2007 2009 2011 2013E 2015E

UIO TIV

Strong growth in Vehicle Sales driving strong growth in Aftersales

Chile luxury segment Units in Operation(1-3 years) & TIV

• Strong growth in the units in operation (UIO) in recent years and set to continue

• UIO growth drives growth in the high margin aftersales

business

• New site enables Inchcape to benefit from this growth

Source: IHS AutomotiveTIV 2003 – 2009 CAGR +17%TIV 2009 – 2015E CAGR +25%

2003 – 2009 UIO CAGR +19%


Risk management

Capex & investment

Investing in people




2009 – 2015E UIO CAGR +19%

23

New BMW Santiago flagship site

• New site consolidates 5

facilities in Santiago into one

• Class leading representation

of the brand product range

• 10 BMW sales executives

increasing to 15

• Doubling of aftersales

capacity

New facility

BMW World Chile

Risk management


Investing in people Rewarding performance

24

• LEED Gold certification – one of the most sustainable buildings in the world

• Cutting edge architectural design facilitates customer flow, premium ambience and outstanding product display

• Distinct areas of customer experience segmented by vehicle type, e.g. M Sport and Motorrad

• Highest standards of technical capability

A new standard in design, innovation and sustainability…

…delivering a superior customer experience

Risk management



25

Marketing – luxury market leadership

38%

27%

24%

26%

28%

30%

32%

34%

36%

38%

40%

2009 2012

• As the distributor Inchcape is the national

marketer for BMW in

Chile

• Couple our local market

expertise with support

from BMW to promote the brand USPs

effectively

• Luxury market share

leadership position

BMW market share % of the luxury segment in Chile

Risk management



26

INCHCAPE STARPLUS MARKETING MODEL

• Campaign created to leverage the completion of the new flagship BMW site in Santiago

• Emphasises BMW brand quality, product range, technology, design and comprehensive customer service offering

Inchcape bespoke marketing processes are a competitive advantage and drive market share

Risk management



27

Innovation in customer service drives retention

Online booking │Online trackingActive reception │Key reader Tele-service │Mobile service

3 Years Warranty

3 Years Free maintenance

Risk management



What drives the sustainability of our earnings growth?

Sustainable earnings growth

29

What drives the sustainability of our earnings growth?

1. The right markets

• Robust broad based growth across all categories expected

• Inchcape distribution focuses on small and medium size markets

2. The right brands

• Six core premium and luxury OEM partners

• Long standing relationships

3. The right operational discipline

• Strong track record for our partners, with industry leading market• market share and customer service metrics

4. The right financials

• Growth and defensive value drivers coupled with cost/cash discipline

30

Right markets: Strong growth forecast in global car market

Growth opportunities across the value chain

Source: IHS Automotive

Global TIV*

mill

ion

+24%

mill

ion

+20%

* TIV – Total Industry Volume (number of new cars sold) ** Car Parc refers to the number of cars on the road

Growth opportunities in all categories: New, Used, F&I, Service & Parts

Source: LMC Automotive

Global Car Parc**

962 995 1,0331,074

1,116

930

2012 2013 2014 2015 2016 2017

82 86 91 95 99

80

2012 2013 2014 2015 2016 2017

31

Balanced growth in APAC / EM and UK / Europe

Inchcape markets

% Inchcape Revenue H1 2013

% Inchcape Trading profit

H1 2013

Trading profit Margin %

H1 2013

GDP growth CAGR 2012-17

(Source: IMF)

TIV growth CAGR

2012-17(Source: IHS

Automotive)

Car parc growth CAGR 2012-17

(Source: LMC Automotive)

Asia-Pacific & Emerging

Markets21 56% 70% 6.1% +2.8% +5.1% +3.7%

UK & Europe 5 44% 30% 3.3% +0.8% +2.2% +0.8%

32

• All of Inchcape’s distribution & VIR markets are outside of the top 10 global markets

• Inchcape acts as a professional and well financed route to market for its brand partners in small and medium size markets

The right markets

Country ranking (TIV)

Operational process and financial resource advantage versus the local competition

2012, IHS Automotive (Inchcape distribution & VIR markets)

Australia 14 Bulgaria 74Belgium 25 Estonia 75Chile 29 Brunei 79Peru 42 Lithuania 80Finland 45 Latvia 85New Zealand 48 Macau 86Romania 54 Guam 91Greece 60 Macedonia 97Luxembourg 63 Saipan >100Hong Kong 67 Ethiopia >100Singapore 68 Albania >100

33

The right brands

Six core relationships deliver c90% of profit

Premium brands’ pricing power deliver

superior margins

Strong R&D capability to

lead powertrainand segment innovation

Portfolio of the world’s leading premium automotive brands

34

Long standing relationships

Inchcape length of brand relationships

• Inchcape delivers on market share and customer service excellence

• Established relationships with brand partners across multiple continents 0

5

10

15

20

25

30

35

40

45

50

Subaru BMW VW Mercedes JLR Toyota

Years

35


Dealer network development


Risk management



Capex & investment

Investing in people


Customer serviceInchcape Advantage



The right operational discipline

36

Strong track record for our brand partners

Inchcape (Crown Motors)

• 22 consecutive years of market share leadership in passenger and commercial vehicles

• Crown Motors the world’s first distributor of all the major Toyota Group brands

37

32.035.5

39.1

20.722.9

-

5.010.0

15.0

20.0

25.0

30.0

35.0

40.0

45.0

2010 2011 2012 H 1

2012

H 1

2013

5,885 5,826 6,085

3,1093,313

0.0

1.0

2.0

3.0

4.0

5.0

6.0

7.0

2010 2011 2012 H1 2012 H1 2013

The right financials

3.8

4.24.3

4.4

4.6

3.6

3.8

4.0

4.2

4.4

4.6

4.8

5.0

2010 2011 2012 H1 2012 H1 2013

Revenue

£b

n

225.5244.4

259.8

137.6153.7

0.0

50.0

100.0

150.0

200.0

250.0

300.0

2010 2011 2012 H1 2012 H1 2013

Operating profit*

£m

Adjusted EPS*

p

Operating margin*

%

Net cash

£m

205.8

243.5

276.2

189.1

100.0

200.0

300.0

2010 2011 2012 H1 2013

All at actual rates

* Pre exceptional items. H1 2012 & 2012 restated for the adoption of IAS 19 (Revised). H1 2013 includes a property disposal profit of £6.2m

Strong profit and cash performance

ROCE

21%22% 22%

15%

17%

19%

21%

23%

25%

2010 2011 2012

38

Performance management discipline

£m

18% cost reduction since 2008 Robust free cash flow

Consistent revenue growth delivered with strong cost and cash controls

613686

(124)

(7)

58

2008 Adj* Inflation Non LFL Cost

Reduction

2012

* 2008 Adj reflects a £25m increase for M&A

-100

-50

0

50

100

150

200

2009 2010 2011 2012

FCF (£m)

39

Balance of growth and defensive value drivers


Global TIV*

mill

ion

+20%

* TIV – Total Industry Volume (number of new cars sold) ** Car Parc refers to the number of cars on the road

Growth opportunities in all categories: New, Used, F&I, Service & Parts


Global Car Parc**

962 995 1,0331,074

1,116

930

2012 2013 2014 2015 2016 2017


mill

ion

+24%

82 86 91 95 99

80

2012 2013 2014 2015 2016 2017

40


Growth value drivers


mill

ion

+24%

82 86 91 95 99

80

2012 2013 2014 2015 2016 2017

Global TIV

% of Gross Profit 40%

Global vehicles 80m

NewVehicleSales

F&I

Structural and cyclical growth opportunities

41


mill

ion

+20%


Global Car Parc

962 995 1,0331,074

1,116

930

2012 2013 2014 2015 2016 2017

Defensive value drivers

% of Gross Profit 60%

Global vehicles 930m

Used Vehicles

Sales

Service Parts

Car Parc over 10 times the size of the new car market

42

• 72% of Inchcape’s profits are delivered in small and medium size distribution markets

• Selective investments in high quality retail markets, where OEMs are the distributors

• Strong market share positions and long standing relationships with the leading luxury and premium brands

• Inchcape bespoke processes deliver operational excellence across all categories: New, Used, F&I, Service and Parts

• Proven business model and robust industry growth prospects to support shareholder value creation

Leading luxury and premium operator in the right markets

Delivering sustainable earnings growth with strong cash generation

Appendix

44

Definitions

Like-for-like

The following are excluded from like-for-like sales:

1. Businesses that are acquired, from the date of acquisition until the 13th month of ownership

2. Businesses that are sold or closed

3. Retail centres that are relocated from the date of opening until the 13th month of trading in the new location

Emerging markets

Emerging markets are those countries in which the Group operates that have yet to reach a mature stage of development and accordingly are in, or are expected to return to, the growth phase of the development cycle.

This currently covers the following countries:

The Balkans The Baltics Poland Russia

China Africa South America

45

Broad geographic spread - truly international

Hong Kong (ML)

United Kingdom (MLP)

35.1% of ’12 Group Revenue

23.3% of ’12 Group Trading

profit

R North Asia

8.5% of '12 Group Revenue

18.9% of '12 Group Trading profit

VIR

South Asia


12.5% of '12 Group Trading

profit

VIR

Australasia


24.0% of '12 Group Trading

profit

D R

Finland

Luxembourg

Europe



BelgiumD R

Greece (ML)

D R

D R

D R

Brunei (ML) Guam (ML)

Saipan (ML)New Zealand

VIR VIR

VIRDKey:

R = Retail D = Distribution

VIR = Vertically integrated retail

(ML) = A market leader

(MLP) = A market leader, premium brands

Russia and Emerging Markets



AlbaniaD

BulgariaD R

Macedonia

VIR

Romania

D R

Peru (MLP)

VIR

PolandR

Latvia (ML)

VIRR

Macau (ML)

VIR

Lithuania(ML)

VIRR

Australia Singapore

Russia

R

China

R

Estonia

VIR

R VIR

Chile (MLP) Ethiopia (ML)

VIR

Note: Percentage figures represent revenue from third parties and trading profit (defined as operating profit excluding the impact of exceptional items and central costs)

46

Disclaimer

The information and opinions contained in this presentation are provided as at the date of the document.

Certain statements in this presentation, particularly those regarding the future prospects of Inchcape plc

(“Inchcape”), returns, pricing, acquisitions, divestments, industry growth or other trend projections are or may

be forward-looking statements. These forward-looking statements are not historical facts, nor are they

guarantees of future performance. Such statements are based on current expectations and belief and, by their

nature, are subject to a number of known and unknown risks and uncertainties which may cause the actual

results, prospects and developments of Inchcape to differ materially from those expressed or implied by these forward-looking statements.

Except as required by any applicable law or regulation, Inchcape expressly disclaims any obligation or

undertaking to release publicly any updates or revisions to any forward-looking statements contained in this

presentation to reflect any change in Inchcape’s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.

All information in the presentation is the property of Inchcape plc and may not be reproduced or recorded

without the written permission of the company. Nothing contained in the presentation constitutes or shall be

deemed to constitute an offer or invitation to invest in or otherwise deal in any shares or other securities of Inchcape plc.

© Inchcape 2013. All rights reserved. Proprietary and confidential information. No unauthorised copying or reproduction. Inchcape and the Inchcape logo are the registered trademarks of the Inchcape Group.

The information contained in this presentation has been obtained from company sources and from sources which Inchcape believes to be reliable but it has not independently verified such information and does not guarantee that it is accurate or complete.

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