Credit Corp Group Limited · ASX:CCP

Credit — Shareholder Meeting (November 2018)

19 slides from Credit's shareholder meeting presentation, Nov 1, 2018

1. Slide 1: Annual General Meeting FY19 Performance Update

   Annual General Meeting FY19 Performance Update For personal use only Thomas Beregi, CEO Michael Eadie, CFO

2. Slide 2: Leadership in the credit impaired consumer segment

   Leadership in the credit impaired consumer segment… For personal use only • Long-term growth ANALYTICS & DISCIPLINE OPERATIONAL EXCELLENCE SUSTAINABILITY & COMPLIANCE • ROE 16% - 18% • Low gearing Australian / NZ debt buying • Largest database • Highest asset turnover 1 • No adverse orders or undert

3. Slide 3: ...has produced sustained financial performance

   …has produced sustained financial performance… For personal use only Earnings Per Share, Dividends Per Share and Return on Equity Cents ROE % per share 150 24% EPS CAGR 27% 120 135 90 117 98 8% 60 83 75 70 58 30 47 67 58 44 50 12 24 31 37 40 29 8 20 4 4 - FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16

4. Slide 4: ...while positioning CCP to seize opportunity across all segments

   …while positioning CCP to seize opportunity across all segments… For personal use only Segment Market conditions Credit Corp’s response • Continued pricing competition • Momentum into FY19 provided by strong operational Aus/NZ performance Debt buying • Compliance is an increasing sensitivity for cre

5. Slide 5: A strong operational start to FY19

   A strong operational start to FY19… For personal use only Pricing accuracy and returns on track Efficiency • Total cumulative collections above aggregate pricing expectations • YTD Oct-18 productivity up by 5% over the pcp • YTD Oct-18 collections up 7% over the pcp • YTD Oct-18 Aus/NZ collections i

6. Slide 6: ...has combined with industry leading compliance

   …has combined with industry leading compliance… • Peerless compliance record For personal use only - No regulatory orders or undertakings despite being the largest and longest established operator - No reportable External Dispute Resolution (EDR) systemic issues • Superior EDR complaint rate 1 • Cle

7. Slide 7: ...to deliver an upgraded purchasing outlook

   …to deliver an upgraded purchasing outlook… • More than $100m in FY19 purchasing contracted over the past 3 months For personal use only • Further opportunity reflected in revised guidance PDL Investment $ 200m $ 195m FY19 purchasing guide $170 - $190m1 $ 150m Aus/NZ debt buying US debt buying $ 100

8. Slide 8: ...and the balance sheet to seize any opportunities

   …and the balance sheet to seize any opportunities For personal use only • Gearing is 41% with $100m of headroom as at Oct-18 • Strong cash flow generation will further increase headroom over the balance of FY19 Facility headroom and gearing $m Gearing $ 300m 50% 40% $ 200m 30% $ 100m 20% - 10% FY16

9. Slide 9: Lending growth has exceeded expectations

   Lending growth has exceeded expectations… For personal use only • Total settlements up by 24% over the pcp • New customer settlements up 17% over the pcp Customer settlements ($m) Customer settlements ($m) $ 80m $ 200m $ 60m $ 150m $ 40m $ 100m $ 20m $ 50m - - YTD Oct-17 YTD Oct-18 FY18 FY19 Project

10. Slide 10: ...and is translating into strong results

    …and is translating into strong results For personal use only • Top end of FY19 guidance implies an 18% increase in consumer lending NPAT • Target 12% ROA being achieved Earnings growth NPAT ROA $ 20m $ 19m 15% $ 15m NPAT 10% NPAT projected $ 10m ROA ROA projected 5% $ 5m - - FY16 FY17 FY18 FY19 Pro

11. Slide 11: US debt buying economics in line with established competitors

    US debt buying economics in line with established competitors… • US asset turnover comparable to listed competitors despite limited ‘tail’ of collections For personal use only • Cost to collect also similar despite the operation still ramping up and up-front expensing of legal costs US debt buying e

12. Slide 12: ...while we continue to focus on improvement and growth

    …while we continue to focus on improvement and growth… • Operational and technology enhancements driving results For personal use only - Step up in legal collections - Increased rates of customer contact and conversion to paying outcomes • New facility opened in June to cater for 400+ headcount • Pu

13. Slide 13: ...to capture the opportunity and accelerate profits

    …to capture the opportunity and accelerate profits • US produced an inaugural profit in FY18 and profitability will increase in FY19 For personal use only • Profitability will accelerate in FY20 • PDL investment opportunity is not a constraint - Commenced buying from the largest seller during Octobe

14. Slide 14: Outlook is for a year of solid earnings growth

    Outlook is for a year of solid earnings growth For personal use only Initial guidance Upgraded guidance Jul 2018 Nov 2018 PDL acquisitions $150 - $170m $170 - $190m Net lending $45 - $50m $45 - $50m NPAT $67 - $69m $67 - $69m EPS (basic) 140 - 144 cents 140 - 144 cents Credit Corp Group FY19 Perform

15. Slide 15: Appendix | Key operating metrics

    For personal use only Appendix | Key operating metrics Credit Corp Group FY19 Performance Update | 15

16. Slide 16: Appendix | Pricing discipline and accuracy

    Appendix 1 | Pricing discipline and accuracy For personal use only Pricing discipline and accuracy Cumulative collections $ 2,800m Actual cash $ 2,400m collections $ 2,000m $ 1,600m $ 1,200m Initial projections $ 800m $ 400m - * For all PDLs held at June 2008, initial projections represent the forec

17. Slide 17: Appendix | Collections life cycle

    Appendix 2 | Collections life cycle For personal use only PDL collections by vintage +7% 1 $ 105m $ 90m 31% 30% 30% 31% 30% 32% 29% $ 75m 33% 32% 31% 30% 32% 32% 13% 14% 18% $ 60m 11% 14% 16% 15% 12% 10% 15% 17% 17% 15% $ 45m 21% 21% 22% 25% 23% 15% 19% 23% 23% 16% 19% 15% 15% $ 30m 38% 38% 36% 37%

18. Slide 18: Appendix | Productivity

    Appendix 3 | Productivity For personal use only PDL collections per hour $ 300 YTD Oct-18 average FY19: $236 FY18: $225 $ 250 12m to Oct-18 12m to Oct-17 $ 200 $ 150 $ 100 Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Credit Corp Group FY19 Performance Update | 18

19. Slide 19: Appendix | Payers base

    Appendix 4 | Payers base For personal use only Portfolio summary Total portfolio Dec 16 Jun 17 Dec 17 Jun 18 Oct 18 Face value $5.7bn $5.8bn $5.9bn $6.0bn $6.1bn Number of accounts 699,000 716,000 710,000 710,000 710,000 Payment arrangements Face value $1,235m $1,300m $1,300m $1,300m $1,300m Number

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