Slide 1: ASX cover letter: Conference presentation
For personal use only 5 May 2016 Market Announcements Office ASX Limited Exchange Centre 20 Bridge Street Sydney NSW 2000 Dear Sir/Madam CONFERENCE PRESENTATION Please see attached Macquarie Conference presentation. Please contact the undersigned with any questions on +61 2 9495 6595, +61 401 990 86
Slide 2: Macquarie Conference Presentation
For personal use only Macquarie Conference Presentation 5 May 2016 Presented By: Robert Kelly – Managing Director and CEO Stephen Humphrys – Chief Financial Officer
Slide 3: Important notice
For personal use only Important notice This presentation has been prepared by Steadfast Group Limited (“Steadfast”). This presentation contains general information in summary form which is current as at 5 May 2016. This presentation is not a recommendation or advice in relation to Steadfast or any p
Slide 4: Resilient SME customer base
For personal use only Resilient SME customer base 1,2,3 Steadfast Network Brokers’ GWP mix Corporate Other Retail 2% 2% 87% of customer base relates to small to Retail – medium size enterprises (SMEs) Home/Motor 9% Medium less pricing volatility enterprises 32% Focus is on advice Low exposure
Slide 5: 1H FY16 highlights
For personal use only 1H FY16 highlights Strong earnings growth in 1H FY16 vs 1H FY15 Flat market conditions Solid organic performance Acquisitions overall performing ahead of expectations Interim dividend up 20% pcp FY16 guidance re-affirmed © 2016 Steadfast Group Limited | 4
Slide 6: Network GWP and price movement
For personal use only Network GWP and price movement 1 Price and total growth in Network GWP Pricing moved from soft to flat; 1H FY14 2H FY14 1H FY15 2H FY15 1H FY16 volume growth continues 4% 2% 0.6% Price growth flattened to +0.1% in 1H 0% 0.1% FY16 compared to 2H FY15 (-4.0%) -2% -2.2% Volume
Slide 7: Network Brokers GWP growth
For personal use only Network Brokers GWP growth Network Brokers 1,2 Gross Written Premium (GWP) 5.0 1H FY16 vs 1H FY15 2H $4.4b 4.5 $4.1b 1H 4.0 $3.9b - 3.9% AU price (-$83m) $3.4b 3.5 3.0 2.1 2.3 +3.5% AU volume ($74m) $billion 2.0 2.5 1.8 2.6% pcp 2.0 +2.4% New AU brokers ($51m) 1.5 2.1 2.2 1.0 1
Slide 8: Underwriting Agencies GWP growth
For personal use only Underwriting Agencies GWP growth Steadfast Underwriting Agencies Gross Written Premium (GWP) GWP growth enhanced 450 significantly by Calliden and the QBE agency 400 $385m 273% pcp acquisitions 350 $million 300 On track to generate 250 $284m 1H annual GWP of $765m+ $378m 20
Slide 9: Operating highlights from FY15 acquisitions
Operating highlights from FY15 acquisitions Performance from largest acquisitions exceeded our initial expectations For personal use only 1H FY16 vs normalised Acquisitions historical EBITA Operating highlights Cost savings generated from staff and systems Calliden agencies +$1.2m rationalisation
Slide 10: Financial information
For personal use only Financial information
Slide 11: Strong growth from acquisitions
For personal use only Strong growth from acquisitions Growth from Underlying Underlying Organic acquisitions, Six months ended 31 December 1H FY16 1H FY15 growth % & hubbing %1 Revenue ($m) 226.1 108.4 109% 6% 102% EBITA pre CO expenses ($m) 66.0 37.9 74% 1% 73% EBITA1 ($m) 60.4 34.9 73% 1% 72% NPAT
Slide 12: Track record of strong earnings growth
For personal use only Track record of strong earnings growth Cash EPS EBITA pre Corporate Office expenses 74% pcp 10.0 1H 70 66.0 1H 2H 61.0 60 2H cents per share 8.0 $million 50 5.76 6.0 4.32 26% pcp 40 32.2 33.1 37.4 37.9 3.50 28.9 30 4.0 20 5.10 2.0 3.62 4.03 3.27 10 0.0 0 Pf FY13 Pf FY14 FY15 FY
Slide 13: Fully franked interim dividend of 2.4 cents, up 20%
For personal use only Fully franked interim dividend of 2.4 cents, up 20% In line with dividend payout ratio target of 65% to 85% of underlying net profit after tax and a minimum of 50% of net profit 6.0 Interim dividend after tax before amortisation and impairment 5.0 Final dividend of intangible
Slide 14: Strong conversion of profit to cash
Strong conversion of profit to cash Statutory cash flow statement For personal use only Six months ended 31 Dec, $ millions 1H FY16 1H FY15 Cash flows from operating activities >100% of underlying Receipts from customers 178.9 111.9 NPATA converted into cash flow Payments to suppliers and employee
Slide 15: Healthy balance sheet
Healthy balance sheet Statutory balance sheet For personal use only $ millions 31 Dec 15 30 Jun 15 Cash and cash equivalents 79.9 67.6 Cash held on trust 215.1 172.2 Corporate gearing ratio1 at Receivables & other 266.1 343.3 17% versus maximum target Total current assets 561.1 583.1 gearing ratio
Slide 16: Strategy & Outlook
For personal use only Strategy & Outlook
Slide 17: Strategic initiatives
For personal use only Strategic initiatives Business Roll out common Hubbing Offshoring IT systems Development Steadfast Asian Acquisition New Zealand pipeline Direct presence © 2016 Steadfast Group Limited | 16
Slide 18: Common IT systems
For personal use only Common IT systems IT is a competitive advantage as it creates significant cost synergies and efficiencies We have elected to build our own systems – we don’t want to have a third party controlling our destiny or our data • Broker quoting and underwriting system, formerly kn
Slide 19: Re-affirm FY16 outlook
For personal use only Re-affirm FY16 outlook FY16 underlying Cash EPS growth guidance range of 1 10-14%, driven by: Underlying NPATA 41-46% Uplift from 2H FY15 acquisitions 85 $80 – $83m Organic growth 75 65 $ millions 56.7 FY16 underlying NPATA guidance range of $80- 55 $83m, up 41-46% 41.2
Slide 20: Questions
For personal use only Questions