Release Date: August 09, 2026
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- CAR Group Ltd CSXXY delivered another excellent year with 12% growth in both pro forma revenue and EBITDA in constant currency, and adjusted net profit after tax increased 11%.
- The company has a strong track record of consistent double-digit growth over the past five years, driven by its market leadership and reinvestment in innovation.
- AI initiatives, such as CG/engine and CG/lab, are enhancing customer experiences and operational efficiency, leading to higher conversion rates and improved dealer tools.
- The Americas region, now under unified leadership, is showing strong momentum with double-digit growth in North America and Latin America, supported by product innovation and media growth.
- The company maintains a strong balance sheet with 100% cash conversion and leverage at 1.7x, providing flexibility for future investments and M&A.
Negative Points
- Second-half revenue growth in the US (Trader Interactive) decelerated slightly due to media campaign timing, though management remains confident in double-digit growth for FY27.
- The exit of the low-margin Car10 factoring business in Brazil impacted Webmotors' revenue growth, though it was intentional to improve margins.
- Private listings in Australia saw a slowdown in the second half due to a focus on removing stale listings and a temporary dip in consumer sentiment, though volumes have rebounded.
- The company faces FX headwinds, with a 2% negative impact on FY26 results and a similar expected headwind in FY27, particularly from the US and Korea.
- Margins in North America and Asia are expected to contract slightly in FY27 due to continued investments in marine and Dealer Direct, which may pressure near-term profitability.
Q & A Highlights
Q: Can you unpack the drivers behind the slight revenue deceleration in the second half for the Americas (Trader Interactive) and your confidence in delivering double-digit growth in FY27, especially without acquisition benefits?
A: Eduardo Jurcevic (CEO, The Americas) attributed the slight difference between the first and second half to the timing of media campaigns, which was the primary impact. He expressed strong confidence in delivering double-digit growth in FY27, citing the strength of the US market and the significant opportunities ahead. He noted that the strategy for Trader Interactive will follow the successful "playbook" used at Webmotors, focusing on building a stronger ecosystem by connecting the marketplace with products like DP360 (CRM) and leveraging AI.
Q: Can you quantify the impact of exiting the Car10 payment factoring business on Webmotors' revenue and explain the rationale for the sale?
A: Eduardo Jurcevic (CEO, The Americas) declined to provide a specific number but explained the rationale was that the credit card machine business acquired with Car10 was a low-margin operation that did not align with the company's strategic focus. He confirmed the exit would not impact the rest of the company's strategy. CEO William Elliot added that the underlying growth rate in the second half was similar to the first half when excluding the exit of the Car10 factoring revenues.
Q: What is driving the strong traffic growth in the US market, and does this give you more confidence in price increases for next year?
A: CEO William Elliot explained that the strong Q4 outcomes are a result of reinvesting operational efficiencies into brand and advertising, alongside improvements to the consumer experience on the site, which are driving higher lead volumes and better outcomes for dealers. Eduardo Jurcevic (CEO, The Americas) added that the improvements in lead volumes and audience visits in the last quarter suggest the market is close to the bottom and poised for recovery, supporting confidence in a strong FY27.
Q: What were the drivers behind the deceleration in Australian private listings revenue in the second half, and what is the trajectory into FY27?
A: Craig Fraser (MD, carsales) explained that the company has been focused on improving the consumer experience by removing stale listings (ads not updated within 30 days) and shifting inventory into the dealer ecosystem. He noted that market conditions have improved, with lead volumes and site traffic rebounding strongly at the start of FY27. He confirmed that private volumes are performing well and momentum is expected to continue as they accelerate the value provided to private sellers.
Q: Can you break down the Australian dealer revenue growth between volume and yield, and are you planning similar price increases for next year?
A: Craig Fraser (MD, carsales) stated that the FY26 growth was roughly 4% from yield, 3% from volume, and 1% from depth. He noted that lead volumes dipped briefly in the second half due to the Iran war but have rebounded nicely. Regarding pricing for FY27, he said no final decision has been made, as they consider factors like dealer health, market conditions, and product innovation.
Q: How should we think about the margin profile for the LatAm business following the exit of Car10's low-margin business?
A: Eduardo Jurcevic (CEO, The Americas) confirmed that margin expansion is a main goal for Webmotors and expects this to continue. However, he emphasized that they will not accelerate margin expansion at the expense of missing out on market investment opportunities. The company aims to balance growth and profitability.
Q: Can you provide more detail on the new Nexgate platform and the trade-in product in Australia, and their potential revenue impact?
A: Craig Fraser (MD, carsales) said Nexgate was launched to the industry at the AADA convention and will go live for all dealer customers on September 1. He highlighted that it was designed with dealer input and integrates AI for pricing, sourcing, and lead nurturing to create efficiency. He noted the trade-in product is performing well and is driving greater value for dealer partners, especially with the increase in new car buyer demand and the scaling of Chinese OEM entrants.
Q: Can you explain the EBITDA adjustments in the second half of FY26, which totaled $18 million?
A: CFO Geoff Trumbull explained that the adjustments relate to M&A activities and restructuring across the business. He noted that while a lot of the restructuring, such as leadership transitions, was picked up in the first half, there were additional restructuring costs in the second half. The company presents an adjusted number to reflect the underlying performance of the business.
Q: How are you thinking about M&A strategy, particularly regarding the recent acquisitions of dealer CRMs in the US and Brazil?
A: CEO William Elliot stated that the recent small acquisitions of CRM businesses are part of a more concerted focus on embedding the company closer with dealer and OEM customers, providing services across the whole transaction lifecycle. He clarified that the recent debt facility refinancing is business as usual and not a signal of a change in M&A strategy. The focus remains on organic ecosystem plays like Nexgate to generate the best return on capital.
Q: Can you provide an update on the financing market in Brazil and expectations for finance income growth in FY27?
A: Eduardo Jurcevic (CEO, The Americas) stated that the credit market in Brazil has been resilient despite interest rate increases. He noted that the recent decrease in interest rates by the Central Bank opens up opportunities for growth in financing. He believes the tough period is behind them and sees financing as a huge lever for future growth, with normal volatility expected in the market.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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