Mcmillan Shakespeare Limited · ASX:MMS
Mcmillan Shakespeare — H1 FY2014 Earnings Presentation
24 slides from Mcmillan Shakespeare's earnings presentation, Feb 18, 2014
Slide 1: MMS Group 1HFY14 Results Presentation
For personal use only MMS Group 1HFY14 Results Presentation February 2014
Slide 2: 1HFY14 Key Points
MMSG Group 1HFY14 Results Presentation 2 1HFY14 Key Points For personal use only First half results materially affected by previous Federal Government’s 16 July, 2013 announcement relating to the treatment of FBT on motor vehicles. Following the reversal of this policy by the new Federal Governm
Slide 3: 1HFY14 Key Points (cont'd)
MMSG Group 1HFY14 Results Presentation 3 1HFY14 Key Points (cont’d) For personal use only Assets under finance and management continued to grow ($333m or 10% on PCP), despite patchy economic conditions and a very competitive market. CLM (UK) acquired for $A14m in October 2013. Diversification an
Slide 4: Consolidated Financial Performance
MMSG Group 1HFY14 Results Presentation 4 Consolidated Financial Performance For personal use only 1HFY14 1HFY13 % 1HFY14 1HFY13 % 1HFY14 1HFY13 Increas $000 $000 e $000 $000 Increase $000 $000 Group Group Remuneration Remuneration Asset Asset Services Services Management (1) Management Total Total R
Slide 5: Financials – Key Points
MMSG Group 1HFY14 Results Presentation 5 Financials – Key Points For personal use only Consolidated NPAT $19.3m ($10.5m or 35% less than PCP). Group Remuneration Services NPAT $13.2m ($8.7m or 40% less than PCP). Asset Management NPAT $6.4m, $6.6m excluding the UK JV ($0.7m or 9% less than PCP
Slide 6: Earnings Per Share
MMSG Group 1HFY14 Results Presentation 6 Earnings Per Share For personal use only 45.00 40.00 35.00 Basic EPS 8-year CAGR of 16% 30.00 25.00 cents 20.00 15.00 10.00 5.00 0.00 1H FY06 1H FY07 1H FY08 1H FY09 1H FY10 1H FY11 1H FY12 1H FY13 1H FY14 Basic EPS Cash EPS Cash EPS after CAPEX but excludes
Slide 7: NPAT Performance
MMSG Group 1HFY14 Results Presentation 7 NPAT Performance For personal use only 35 NPAT 8 year CAGR 17% 30 29.7 25 24.9 20 20.5 19.3 $m 15 10 11.2 9.5 7.9 5 6.1 5.3 0 1H FY06 1H FY07 1H FY08 1H FY09 1H FY10 1H FY11 1H FY12 1H FY13 1H FY14
Slide 8: Definition of Segments
MMSG Group 1HFY14 Results Presentation 8 Definition of Segments For personal use only 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 not
Slide 9: Group Remuneration Services Financial Performance
MMSG Group 1HFY14 Results Presentation 9 Group Remuneration Services Financial Performance For personal use only 1HFY14 1HFY13 % $000 $000 Inc Segment revenue 1 70,548 75,757 -7% Expenses Employee expenses 34,655 30,891 12% Depn and amort of PPE and software 1,796 1,808 -1% Property and other expens
Slide 10: Competitive Strengths and Performance Indices
MMSG Group 1HFY14 Results Presentation 10 Competitive Strengths and Performance Indices For personal use only Group Remuneration Services Productivity Index (7/08 = 100) MMS Customer Satisfaction Index [Rolling 3 month Revenue (ex SP Interest) / FTE] December 2008 = 100 160 250 155 150 145 200 140 1
Slide 11: Novated lease orders YTD FY14
MMSG Group 1HFY14 Results Presentation 11 Novated lease orders YTD FY14 For personal use only Period from Federal Average novated lease orders per working day Govt. election FY13 base index = 100 Index 100 90 80 70 Period from Labour FBT announcement 60 to Federal Govt. election 50 40 30 20 10 0 FY1
Slide 12: Group Remuneration Services Commentary
MMSG Group 1HFY14 Results Presentation 12 Group Remuneration Services Commentary For personal use only NPAT 1HFY14 of $13.2m was $8.7m or 40% lower than PCP, including reduction in revenue, increased staff costs as a result of decision to retain all staff and $1.9m for costs associated with the pr
Slide 13: Asset Management (AM) Financial Performance
MMSG Group 1HFY14 Results Presentation 13 Asset Management (AM) Financial Performance For personal use only Group and Group CLM & UK Australia Australia Group Australia AM AM AM AM AM AM 1HFY14 1HFY14 1HFY14 1HFY13 % % $000 $000 $000 $000 Inc Inc Segment revenue 90,978 5,461 85,517 84,396 8% 1% (1)
Slide 14: Asset Management Commentary
MMSG Group 1HFY14 Results Presentation 14 Asset Management Commentary For personal use only 10% portfolio growth on PCP in a low growth economic environment. Commenced funding in the UK. Implemented new asset management system on time and on budget – this has improved capability to better serv
Slide 15: Asset Management Commentary (cont'd)
MMSG Group 1HFY14 Results Presentation 15 Asset Management Commentary (cont’d) For personal use only 16/7/13 (Proposed FBT changes) caused considerable confusion in respect of tool of trade vehicles (move from Statutory to Operating Cost method) - customers elected to delay replacements. Uncerta
Slide 16: Asset Management Commentary (cont'd)
MMSG Group 1HFY14 Results Presentation 16 Asset Management Commentary (cont’d) For personal use only UK performing in line with expectations – integrating the CLM acquisition. Funding of CLM customers commenced January 2014. RV provision at 31 December 2013 of $2.0m.
Slide 17: Fleet Assets WDV
MMSG Group 1HFY14 Results Presentation 17 Fleet Assets WDV For personal use only 400 8.3% - 6 months 10.0% vs pcp 350 1.4% 15.9% 333 300 303 307 9.4% 8.6% ($m) 250 262 2.6% Growth of 0.5% 239 200 214 215 220 213 150 100 50 0 Acquisition 1 30-Jun-10 31-Dec-10 30-Jun-11 31-Dec-11 30-Jun-12 31-Dec-12 3
Slide 18: Asset Management Key Balance Sheet Numbers
MMSG Group 1HFY14 Results Presentation 18 Asset Management Key Balance Sheet Numbers For personal use only 31-Dec-13 30-Jun-13 Movement $000 $000 $000 Operating lease assets 305,190 287,749 17,441 Motor vehicle inventories 5,507 4,844 663 Finance leases & CHP 21,972 14,577 7,395 Total funded fleet a
Slide 19: Gearing
MMSG Group 1HFY14 Results Presentation 19 Gearing For personal use only MMS & Group Remuneration Asset Group Group Services Management Balance at Balance at 31-Dec-13 31-Dec-13 31-Dec-13 30-Jun-13 $000 $000 $000 $000 Net debt (37,459) 195,665 158,206 124,761 Book value of equity 85,594 117,000 202,5
Slide 20: 1HFY14 Cashflow
MMSG Group 1HFY14 Results Presentation 20 1HFY14 Cashflow For personal use only Group Remuneration Asset Unallocated / MMS Group Services Management parent co. Total $000 $000 $000 $000 Segment NPAT 13,238 6,377 (356) 19,259 Non-fleet depn/amort, reserves and other non-cash items 3,155 2,014 - 5,169
Slide 21: Funding
MMSG Group 1HFY14 Results Presentation 21 Funding For personal use only Additional major Australian bank added to the MMS Club funding facility bringing the total to 3 of the 4 major Australian banks. Terms and credit approval has been obtained to extend the Club facility to February 2017 with a
Slide 22: Outlook
MMSG Group 1HFY14 Results Presentation 22 Outlook For personal use only Second half should see a continuing improvement in the Group Remuneration Services business. Phase 2 of salary packaging systems development due to be delivered by July 2014, driving improved service and greater productivity
Slide 23: Risks and Sensitivities
MMSG Group 1HFY14 Results Presentation 23 Risks and Sensitivities For personal use only Interest rates movements (earnings on float). Second hand car prices (remarketing earnings). New car sales (novated lease participation). Government austerity/redundancy programs. Delivery of new IT pro
Slide 24: MMS Snapshot
MMSG Group 1HFY14 Results Presentation 24 MMS Snapshot For personal use only McMillan Shakespeare Group (ASX: MMS) Group Remuneration Services Asset Management • Fleet Management • Salary packaging • Operating leases, finance administration Australia & NZ United Kingdom leases • Novated leases • Mai
McMillan Shakespeare — H1 FY2014 Earnings Presentation on 6ix