Slide 1: MMS Group FY13 Results Presentation
MMS Group FY13 Results Presentation For personal use only 10 September 2013
Slide 2: FY13 presentation contents
Page 2 MMS Group FY13 Results Presentation For personal use only FY13 presentation contents Page 1. Financial highlights 3 2. Segment performance 8 3. Gearing, cash flow and funding 19 4. Outlook 22 5. Sensitivities 25
Slide 3: Consolidated financial performance
Page 3 MMS Group FY13 Results Presentation For personal use only Consolidated financial performance 2013 2012 % 2013 2012 % 2013 2012 $000 $000 Increase $000 $000 Increase $000 $000 Group Group Remuneration Remuneration Asset Asset Services Services Management Management Total Total Revenue from ope
Slide 4: Financial highlights
Page 4 MMS Group FY13 Results Presentation For personal use only Financial highlights A year of consistent delivery and ongoing organic profitable growth. Consolidated NPAT of $62.2m (growth of 15%). Diluted EPS growth of 10.5%. Group Remuneration Services NPAT of $46.8m (16% growth, 23% cor
Slide 5: Financial highlights
Page 5 MMS Group FY13 Results Presentation For personal use only Financial highlights Strong free cashflow ($60.1m pre-fleet increase). Return on equity of 34%. No final dividend declared due to the on-going uncertainty in relation to the previously proposed changes to the FBT on motor vehicle
Slide 6: Normalised NPAT
Page 6 MMS Group FY13 Results Presentation For personal use only Normalised(1) NPAT 70 60 NPAT 8 year CAGR 36% 62.2 50 54.3 40 43.5 $m 30 27.9 20 20.5 17.4 10 13.2 11.3 5.2 0 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 Note 1: Normalised NPAT excludes the profit recognised on acquisition of Interle
Slide 7: Historical earnings and dividends per share
Page 7 MMS Group FY13 Results Presentation For personal use only Historical earnings and dividends per share Earnings per share Dividends per share 90.0 50.0 80.0 45.0 47.0 40.0 70.0 35.0 38.0 60.0 Basic EPS 7-year 30.0 cents CAGR of 25% 50.0 cents 25.0 24.0 25.0 40.0 20.0 15.0 19.0 30.0 16.5 10.0 1
Slide 8: Definition of segments
Page 8 MMS Group FY13 Results Presentation For personal use only Definition of segments Group Remuneration Services segment definition: The segment provides administrative services in respect of salary packaging and facilitates the settlement of motor vehicle novated leases for customers, but does
Slide 9: Group Remuneration Services financial performance
Page 9 MMS Group FY13 Results Presentation For personal use only Group Remuneration Services financial performance 2013 2012 % $000 $000 Inc Segment revenue 155,855 137,284 14% (1) Expenses Employee expenses 62,408 54,250 15% Depn and amort of PPE and software 3,484 3,438 1% Property and other expen
Slide 10: Group Remuneration Services financial performance (cont'd)
Page 10 MMS Group FY13 Results Presentation For personal use only Group Remuneration Services financial performance (cont’d) 160.0 100.0% 155.9 140.0 90.0% Revenue 8-year CAGR 20% EBIT 8-year CAGR 28% 137.3 80.0% 120.0 70.0% 111.6 100.0 60.0% $m 92.1 80.0 50.0% 76.0 60.0 40.0% 65.8 66.6 54.1 57.2 30
Slide 11: Competitive strengths and performance indices
Page 11 MMS Group FY13 Results Presentation For personal use only Competitive strengths and performance indices MMS Customer Satisfaction Index Group Remuneration Services Productivity Index (7/08 = 100) December 2008 = 100 [Rolling 3 month Revenue (ex SP Interest) / FTE] 160 250 155 150 200 145 140
Slide 12: Group Remuneration Services commentary
Page 12 MMS Group FY13 Results Presentation For personal use only Group Remuneration Services commentary Maintenance of good momentum in new business and participation growth. Strong operational performance - core operating contribution growth of 23%. FY13 result driven by ongoing increases in
Slide 13: Asset Management segment financial performance
Page 13 MMS Group FY13 Results Presentation For personal use only Asset Management segment financial performance 2013 2012 % $000 $000 Inc Segment revenue 171,962 163,342 5% Expenses Depreciation of motor vehicle fleet 74,729 66,942 12% Interest on fleet financing 11,043 9,524 16% Lease and vehicle
Slide 14: Asset Management segment commentary
Page 14 MMS Group FY13 Results Presentation For personal use only Asset Management segment commentary Good growth in assets under finance (assets under finance $307m versus $262m FY12; $220m FY11; $214m FY10). Growth of assets under finance in second half fairly flat. Uncertain economy saw custo
Slide 15: Asset Management segment commentary (cont'd)
Page 15 MMS Group FY13 Results Presentation For personal use only Asset Management segment commentary (cont’d) New asset management system successfully delivered. Increase in yield from in-life services, through leveraging combined scale of Asset Management and Group Remuneration Services (novat
Slide 16: Fleet assets WDV
Page 16 MMS Group FY13 Results Presentation For personal use only Fleet assets WDV 400 350 Growth 17.2% 300 307 Growth 19.1% ($m) 250 262 Growth 0.5% Growth 2.8% 200 213 214 220 150 100 50 0 Acquisition 1 April 2010 30-Jun-10 30-Jun-11 30-Jun-12 30-Jun-13
Slide 17: Remarketing performance
Page 17 MMS Group FY13 Results Presentation For personal use only Remarketing performance As foreshadowed in FY12 results presentation, gross profits from end of lease vehicle sales in FY13 were less than for FY12. Average sale prices for returning vehicles remained strong and exceeded our expec
Slide 18: Asset Management key balance sheet numbers
Page 18 MMS Group FY13 Results Presentation For personal use only Asset Management key balance sheet numbers 30-Jun-13 30-Jun-12 Movement $000 $000 $000 Operating lease assets 287,749 244,023 43,726 Motor vehicle inventories 4,844 1,980 2,864 Finance leases & CHP 14,577 15,560 -984 Total funded flee
Slide 19: Gearing
Page 19 MMS Group FY13 Results Presentation For personal use only Gearing MMS & Group Remuneration Asset Group Group Services Management Balance at Balance at 30-Jun-13 30-Jun-13 30-Jun-13 30-Jun-12 $000 $000 $000 $000 Net debt (54,212) 178,972 124,761 101,580 Book value of equity 92,717 102,718 195
Slide 20: Cash Flow
Page 20 MMS Group FY13 Results Presentation For personal use only Cash Flow Remuneration Asset Unallocated / MMS Group Services Management parent co. Total $000 $000 $000 $000 Segment NPAT 46,793 14,633 737 62,163 Non-fleet depn/amort, reserves and other non-cash items 6,863 1,432 - 8,295 Working ca
Slide 21: Funding
Page 21 MMS Group FY13 Results Presentation For personal use only Funding The Asset Management facility for the Australian fleet assets: Remains at $270m with the ability to increase further; Expires in August 2015; and Provides significant headroom for growth. Subsequent to 30 June 2013 t
Slide 22: Outlook
Page 22 MMS Group FY13 Results Presentation For personal use only Outlook Labor’s announcement on proposed changes to FBT on motor vehicles is likely to have a material adverse affect on our Remuneration Services segment in FY14. But due to the uncertainties set out below, this is presently unquan
Slide 23: Outlook (cont'd)
Page 23 MMS Group FY13 Results Presentation For personal use only Outlook (cont’d) It was not possible to sell new employer novated leasing contracts after 16 July 2013 nor to implement contracts that had been won prior to 16 July. This may have a short term adverse effect on the business but is u
Slide 24: Outlook (cont'd)
Page 24 MMS Group FY13 Results Presentation For personal use only Outlook (cont’d) Ongoing growth in assets under finance in the asset management book and consolidation of JV in UK. Further development of our funding strategy to maintain liquidity and duration. Further productivity improvement
Slide 25: Sensitivities
Page 25 MMS Group FY13 Results Presentation For personal use only Sensitivities Interest rates (earnings on float). Second hand car prices (remarketing earnings). New car sales (novated lease participation). Government austerity/redundancy programs. Delivery of new IT programs. Novated l