Centrepoint Alliance Limited · ASX:CAF
Centrepoint Alliance — H1 2017 Earnings Presentation
24 slides from Centrepoint Alliance's earnings presentation, Feb 24, 2017
Slide 1: First Half 2017 Results
For personal use only FIRST HALF 2017 RESULTS Centrepoint Alliance Limited 24 February 2017 ASX:CAF 1H17 Investor Presentation, 24 February 2017
Slide 2: Highlights
Highlights • Group 1H17 profit after tax was $4.6m up from $0.7m in pcp For personal use only • Premium Funding sold on 30 December 2016 for $21.4m - Gain on sale of $4.5m - $35m cash and no debt - Wealth focussed strategy • Strong operational performance across the business (comparisons to pcp): -
Slide 3: Group Financial Results
Group Financial Results $m 1H16 2H16 1H17 1H17 v 1H16 1H17 v 2H16 For personal use only Revenue (statutory) 64.8 66.0 76.7 18% 16% EBITDA (statutory) 2.4 4.0 5.4 125% 35% Revenue (continuing operations) 57.1 59.3 64.4 13% 9% EBITDA (continuing operations 1.2 2.8 2.2 83% -21% excluding legacy claims)
Slide 4: Centrepoint Wealth Focus
Centrepoint Wealth Focus • Premium Funding was sold to BOQ Finance for $21.4m in December 2016. For personal use only The profit on sale was $4.5m net of net assets, goodwill ($1.2m) and transaction costs ($1.5m). Nil tax payable due to prior year losses • Centrepoint Alliance solely focussed on the
Slide 5: Capital Management
Capital Management The sale of Premium Funding has generated a surplus cash For personal use only position for the group of $35 million The Board considered various capital management initiatives and determined: • A fully franked interim dividend of 2.25cps ($3.5m) payable 5 April 2017 • Updated div
Slide 6: Dividends
Dividends For personal use only • The Board have declared an interim dividend of 2.25 cps fully franked. Record date is 15 March 2017 with payment on 5 April 2017 • There are distributable earnings of $30m and franking account reserve of $25m (equivalent to $59m of fully franked dividends). The Grou
Slide 7: Strong Cash Position
For personal use only Strong Cash Position • A further $1.4m cash was received on the sale of premium funding in February 2017 as final settlement • $35m cash able to fund ongoing high dividend payout ratio and growth initiatives • Net cashflow from operations of $10.8m (1H16: $2.6m) includes $6.0m
Slide 8: Operating Segment Results – Continuing Operations
Operating Segment Results – Continuing Operations Funds Management Licensee and Advice For personal use only Total Wealth Corporate Total and Administration Services $m 1H16 1H17 % 1H16 1H17 % 1H16 1H17 % 1H16 1H17 % 1H16 1H17 % Revenue 5.8 6.2 7% 51.2 58.0 13% 57.0 64.2 13% 0.1 0.2 100% 57.1 64.4 1
Slide 9: Funds under Management and Administration - FUMA
Funds under Management and Administration - FUMA $m 1H16 2H16 1H17 1H17 v 1H16 1H17 v 2H16 For personal use only Revenue 5.8 5.8 6.2 7% 7% EBITDA 1.8 2.0 1.9 6% -5% FUMA 2,856 2,948 3,155 10% 7% Gross inflows 381 379 372 -2% -2% FUMA Net Flows 88 107 87 -1% -19% Managed Account Net 51 61 96 88% 57%
Slide 10: Funds Management and Administration - FUMA
Funds Management and Administration - FUMA • Contemporary FUMA up 20% on pcp For personal use only • Consistently strong flows sustained over past 18 months, contributing to growth in white label platforms and managed accounts • Increasing number of advisers contributing to flows • Margins increasin
Slide 11: Funds Management and Administration
For personal use only Funds Management and Administration • Steadily increasing adviser support for Centrepoint solutions (49%) by licensed advisers 11 1H17 Investor Presentation, 24 February 2017
Slide 12: Licensee and Advice Services
Licensee and Advice Services $m 1H16 2H16 1H17 1H17 v 1H16 1H17 v 2H16 For personal use only Revenue 51.2 53.4 58.0 13% 9% EBITDA (ex claims) 1.3 2.8 2.1 62% -25% New Firms 19 40 26 37% -35% Funds Under Distribution Agreements 8,067 7,738 7,608 -6% -2% No of Advisers (estimated) 1,764 1,793 1,830 4%
Slide 13: Licensee and Advice Services
Licensee and Advice Services • Revenue base transforming to contemporary business model and fee for service For personal use only • Direct (salaried advice) commenced late FY15 and emerging as a significant and fast growing revenue stream • Direct undergoing second phase of investment with direct ma
Slide 14: xseedwealth new brand for direct to consumer salaried advice
For personal use only xseedwealth new brand for our direct to consumer salaried advice channel Revenue of $1.5m and EBITDA of $0.5m up 86% and 177% respectively on pcp Further investment occurring in 2H17 to accelerate client and revenue growth through digital marketing and building out client fulfi
Slide 15: Accounting Partnerships
Accounting Partnerships • Since new regulations were implemented in July 2016, For personal use only accountants must be licensed to provide financial advice • In October 2016 Centrepoint made a $1.5m investment via a convertible note (15% equity) in RFE • RFE has established 18 accountant referral
Slide 16: Life Insurance
Life Insurance • Centrepoint is seed funding the start For personal use only up of a life insurance development business with an experienced team targeting the IFA market • The environment for new entrants is ideal • Centrepoint has a management team with strong life insurance experience and an exis
Slide 17: Outlook
Outlook • Centrepoint is at the forefront of the positive disruption occurring For personal use only across financial services • Centrepoint is successfully creating a differentiated client centric wealth business and leveraging its scale as a leading non- institutional player • Core business lines
Slide 18: Contact Details
For personal use only CONTACT DETAILS John de Zwart John Cowan Managing Director Chief Financial Officer Telephone: +61 2 8987 3002 Telephone: +61 2 8987 3036 Email: jdezwart@cpal.com.au Email: john.cowan@cpal.com.au Level 9, 10 Bridge Street Level 9, 10 Bridge Street Sydney NSW 2000 Sydney NSW 2000
Slide 19: Appendices
For personal use only Appendices 1H17 Investor Presentation, 24 February 2017
Slide 20: Group Balance Sheet
Group Balance Sheet $m 2H16 1H17 1H17 v 2H16 For personal use only Cash and Term Deposits 10.2 34.3 237% Current Interest Bearing Receivables 125.8 0.1 -100% Intangible Assets and Goodwill 3.8 2.2 -43% Other Assets 28.7 25.4 -11% Total Assets 168.5 62.0 -63% Interest Bearing Liabilities 84.0 0.0 -10
Slide 21: Centrepoint Community
Centrepoint Community For personal use only Total: 0 Self-Licensed 0 Corp-Licensed 0 Total: 637 Salaried 0 Self-Licensed 353 Mortgage brokers 0 Total: 172 Corp-Licensed Salaried 182 2 Self-Licensed 134 Mortgage brokers 100 Corp-Licensed 32 Salaried 0 Mortgage brokers 6 Total: 129 Self-Licensed 92 Co
Slide 22: Definitions
Definitions Term Definition Contemporary Business Includes assets and revenue in respect of self-licensed Firms, Salaried Advice, Licensed Practices For personal use only Model (flat fee model), Open Administration Platforms, Managed Accounts and Open Ventura Funds Includes assets and revenue in res
Slide 23: Definitions (continued)
Definitions (continued…) Term Definition Direct Costs* Advice and financial product fees and borrowing expenses of the funding business For personal use only Gross Profit Revenue less direct costs Operating Expenses Expenses excluding direct costs, interest, depreciation and amortization Earnings be
Slide 24: Disclaimer
Disclaimer This presentation is for general information purposes only and should be read in conjunction with the Appendix 4D lodged with the Australian Securities Exchange by Centrepoint Alliance Limited (ASX:CAF) on For personal use only 24 February 2017. This presentation does not provide recommen