Results for the Half Year · Strategy working – – – FOCUS ON HNW INVESTORS IS DELIVERING...
Transcript of Results for the Half Year · Strategy working – – – FOCUS ON HNW INVESTORS IS DELIVERING...
Results for the Half YearEnding 31 December 2019
Important information
Forward looking statements
No investment advice
Disclaimer
Presenters and agenda
Will Davidson Bruce MacDougall
01 02 03 04 05 06
Anthony Wamsteker
Highlights
Business and financial highlights
FUND FLOWS LAGGING
MARGINS MAINTAINED 21%
EARNINGS IMPROVING
49%
$8.76 billion
20%
EXPENSES UNDER
CONTROL
Strategy working
–
–
–
FOCUS ON HNW INVESTORS
IS DELIVERING
PLATFORM MARKET
CONTINUES TO EVOLVE
–
–now $2 trillion
–
POWERWRAP KEY
FINANCIAL MEASURES
IMPROVING IN LINE
WITH STRATEGY
Financial Performance
FUA growing
1H20 1H19 Change % Change
FUA (EOP)
Net FUA Flows
FUA up 20%
6.87.3
8.8
0
1
2
3
4
5
6
7
8
9
10
1H18 1H19 1H20
FUA
20%
Net flows lower
Platform revenue growing
6.9
7.7
9.4
0
1
2
3
4
5
6
7
8
9
10
1H18 1H19 1H20
Platform revenue Platform margins on Funds Under Administration (FUA)
–
–
–
2322
23
0
5
10
15
20
25
1H18 1H19 1H20
21%
Revenue per account increasing
$4,346
Revenue from various
sources growing as
sophistication of
accounts increases
$2 million
Low value accounts
were also closed
$0
$500
$1,000
$1,500
$2,000
$2,500
$3,000
$3,500
$4,000
$4,500
$5,000
1H18 1H19 1H20
Revenue per account
Earnings improving
Improvement lower than EBITDA due to
–
–
Improvement due to
–
–
–
-2.73-2.97
-1.52
-4
-3
-2
-1
0
1H18 1H19 1H20
Underlying EBITDA excluding share-based
payments*
Underlying net loss after tax
-1.30
-2.95
-2.25
-4
-3
-2
-1
0
1H18 1H19 1H20
Financial metrics improving at all levels
Platform revenue up 21%
Expenses under control
Underlying earnings improving
Prior half year comparison ($000)
1HFY20 1HFY19 Variance % Change
Total revenue 9,583 8,042 1,541 19.2%
Total expenses (11,107) (11,013) (94) 0.9%
EBITDA (before share based payments) (1,524) (2,971) 1,447 (48.7%)
EBITDA (1,690) (3,735) 2,045 (54.8%)
EBIT (2,261) (3,831) 1,570 (41.0%)
Loss before income tax (2,247) (3,717) 1,470 (39.5%)
Loss after income tax (2,247) (2,949) 702 (23.8%)
for the half year ended 31 December 2019
Delivering on Prospectus financial results
Revenue
Expenses
EBITDA
EBIT
IPO forecast compared to actuals ($000)
Adjusted* IPO
1HFY20
Actual
1HFY20Variance % Change
Total revenue 9,080 9,583 503 5.5%
Total expenses (11,546) (11,107) 439 (3.8%)
EBITDA (before share based payments) (2,466) (1,524) 942 (38.2%)
EBITDA (2,686) (1,690) 996 (37.1%)
EBIT (3,379) (2,261) 1,118 (33.1%)
Loss before income tax (3,266) (2,247) 1,019 (31.2%)
Loss after income tax (2,516) (2,247) 269 (10.7%)
AHEAD ON
Progress towards profitability
Reducing gap between revenue and expenses
Expenses under control
Low increase in staff expenses
–
–
–
Direct (supplier) expenses reduced 12%
–
–
–
Operating (other) expenses contained
–
$0
$2,000
$4,000
$6,000
$8,000
$10,000
$12,000
HY18 HY19 HY20
Revenue and expenses
Summary
– revenue growing
faster than expenses
– 49% improvement
in underlying EBITDA
- up 21%
- flat
- now $4,346
- up 20%
Business Update
Platform continues to attract HNW clients
December 2019
Continually increasing breadth of product range
and depth of asset classes
Specialisation in alternative assets
Findings from Powerwrap/Investment Trends
HNW Investor Report confirm their importance
30% of those surveyed already invest in or intend
to invest in alternative assets in the coming year
14% of Powerwrap portfolios are allocated
to alternative assets (Wholesale managed funds)
International and fixed interest assets represent
a further collective 17%
Client pipeline positive
Added nine new groups
to the platform
Technology improvements
Powerwrap Order Pad
Enabling the placement of investment
orders and trades from one place
Integrated Asset Library
Intermediary desk order integration
STP nominated bank accounts
Corporate Actions notifications
Industry Growth
Challenger platforms continue to take market share
Share of large financial
institutions continues
to decline
Share of challenger
platforms continues
to rise
Flow-on effects of
banking royal commission
still being felt
Opportunity for
Powerwrap
85%
83% 83%
14.8%
16.7%17.1%
70%
75%
80%
85%
90%
Sep 17 Sep 18 Sep 19
Advisers continuing to leave large financial institutions
Opportunity for Powerwrap
3,500
4,000
4,500
5,000
5,500
6,000
6,500
7,000
7,500
8,000
8,500
9,000
9,500
Dec 17 Dec 18 Dec 19
No
. o
f ad
vis
ers
Market Share (RHS)
HNW investor numbers continue to grow
Now control
$2 trillion in assets
Powerwrap well
positioned to service this
market particularly with
our HIN based solution
Typically use a wide
range of asset classes
0
100
200
300
400
500
600
2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Outlook
Outlook
Industry trends
continue to confirm
our strategy and model
Financial
metrics improving
at all levels
H2 expected to produce
solid new flows
FY20 financial
performance on track
minus $3.9 million
$19.4m $9.8b
Questions
Appendix 1
for the half year ended 31 December 2019
Prior half year comparison ($000)
1HFY20 1HFY19 Variance % Change
Total revenue 9,583 8,042 1,541 19.2%
Total expenses (11,107) (10,803) (304) 2.8%
EBITDA (before share based payments) (1,524) (2,761) 1,237 (44.8%)
EBITDA (1,690) (3,525) 1,835 (52.1%)
EBIT (2,261) (3,621) 1,360 (37.6%)
Loss before income tax (2,247) (3,515) 1,268 (36.1%)
Loss after income tax (2,247) (2,747) 500 (18.2%)
Appendix 2
1HFY20 1HFY19
Statutory EBITDA before share based payments (1,524) (2,761)
Underlying EBITDA before share based payments (1,524) (2,971)
Statutory NPAT (2,247) (2,747)
Underlying NPAT (2,247) (2,949)
ThankYou