Slide 1: FY 2021 Results
FY 2021 Results 26 August 2021 Authorised by Andrew Bennett Group Chief Executive Officer To be read in conjunction with the FY21 COG Appendix 4E and COG’s 30 June 2021 Unaudited Financial Statements
Slide 2: About COG
About COG COG is an ASX listed provider of asset finance broking and aggregation services & non- prime commercial & consumer lending Finance Broking & Aggregation Lending • Australia’s largest equipment finance broking • Provider of non-prime commercial & and aggregation group, with an estimated con
Slide 3: About COG
About COG Australia’s biggest asset finance broker and aggregator & trusted leader in SME and auto finance 18% Estimated market share 3
Slide 4: Our business model
About COG Our business model FB&A FINANCE & INSURANCE Brokerage Fees FUNDING Unsecured Notes and MIS Lending Banks, Non-Banks, Insurance Companies (51% owned) Borrowers FINANCE1 ASSETS FINANCED Management fees and net interest margin 1 Finance and operating leases, chattel mortgages, invoice financi
Slide 5: FY 2021 Highlights
FY 2021 Highlights Strong performance across all business units Revenue1 EBITDA to shareholders2 Final dividend declared of 6.0 (FY20: 1.5 ) 3, 4 3,4 $269.8m $33.5m cents per share, an increase of 295% from FY20, +21% on pcp +57% on pcp reflecting a payout ratio of 62% (FY20: 28% ) 5 5 • Continued t
Slide 6: Priorities
Priorities 1. Continue targeted broker acquisitions - COVID-19 demonstrates 2. Increase Westlawn’s funds under management via the Managed they are resilient and robust Investment Scheme and deploy businesses with largely variable costs proceeds through COG’s broker thus able to withstand economic di
Slide 7: Our results
Summary of Group financial results Revenue growth of $47.6m includes organic growth Our results (+$22.6m), consolidation of Westlawn and Access Capital (+$23.7m) and government subsidies For the year ended 30 June 2021 1 20201 Pcp received 4 $m $m Change FY21 EBITDA margin rises to 18.9% (FY20: 14.0
Slide 8: Drivers of 57% growth in EBITDA to Shareholders
Summary of Group financial results Drivers of 57% growth in EBITDA to Shareholders In $ millions +57% +3% ` +24% +30% 8
Slide 9: Segment performance
Segment performance The Finance Broking & Aggregation and Lending segments both reported strong underlying profit gains in FY21 9
Slide 10: Finance Broking & Aggregation
Finance Broking & Aggregation Strong bottom line despite Revenue growth of $35.6m includes organic growth of 15% (+30.0m), consolidation of Access Capital challenging trading conditions (+$2.8m) and government subsidies received 3 EBITDA margin rises to 13.8% (FY20: 10.9%), (Covid & supply constrain
Slide 11: Finance Broking & Aggregation: Net assets financed
Finance Broking & Aggregation Net assets financed (NAF) $5.16bn net assets financed in FY 2021 $m 2HY 1,403 1,344 1,604 1,524 1,720 1,631 2,198 2,041 2,154 2,365 2,917 2,242 14% vs PCP 1HY 2016 2017 2018 2019 2020 2021 11
Slide 12: Our Aggregation & Broker Brands
Finance Broking & Aggregation Our Aggregation & Broker Brands 100% OWNED COG provides aggregation services to 100% OWNED • Independent network member finance brokers • COG equity owned finance brokers 70% COG offers finance brokers OWNED • Access to wider panel of financiers and volume-based incenti
Slide 13: National asset finance Broking Network footprint
Finance Broking & Aggregation National asset finance Broking Network footprint NT 2 equity QLD 7 aggregation brokers 80 equity brokers 628 aggregation WA brokers 14 equity brokers 274 aggregation brokers SA Aggregation brokers growth 7 equity brokers 175 aggregation NSW & ACT brokers 2,791 3,064 29
Slide 14: Insurance – a growth area for COG
Finance Broking & Aggregation Insurance – a growth area for COG COG’s SME clients also need insurance COG's SME clients also need insurance products which provides an opportunity for COG's asset finance brokers to cross sell insurance to their clients. Generally, the relationship that an asset finan
Slide 15: Westlawn is paving the way for growth in Lending
Lending Westlawn is paving the way Revenue growth of $13.1m primarily comprised of Westlawn contribution (net of intercompany eliminations) of $16.9m, for growth in Lending1 government subsidies of $0.6m, partially offset by $4.4m in lower originations due to the impact of COVID-19 pandemic on tradi
Slide 16: The book is largely concentrated on asset backed contracts
Lending The book is largely Book features • The present value of the total lending book ($200.6m1) includes concentrated on asset COG’s 100% owned subsidiary TL Commercial’s legacy portfolio of $61.2m ($52.7m of lease receivables, including unguaranteed backed contracts residuals and $8.5m of chatte
Slide 17: Earlypay delivers significant contribution to the Other segment
Other Earlypay delivers significant Segment includes COG head office expenses and Hal Group IT business contribution to the Other Revenue contraction of $1.1m reflects lower Hal Group sales, although profitability of the IT business segment improved COG corporate costs are tightly managed and For th
Slide 18: Consolidated statement of financial position
Consolidated statement of financial position As at 30 Jun 30 Jun $m 2021 2020 Cash and cash equivalents increased by $59.8m largely due to the Cash and cash equivalents 94.5 34.7 consolidation of Westlawn Trade and other receivables 18.2 18.0 Contract assets 2.8 2.6 Financial assets – lease and loan
Slide 19: Consolidated statement of cash flows
Consolidated statement of cash flows For the year ended 30 June 2021 2020 $m $m Net cash inflow from operating activities includes Receipts from customers 352.3 284.6 $89.7m (FY20: $49.1m) relating to the lease and loan Payments to suppliers and employees (250.4) (209.9) products offered through the
Slide 20: Outlook
Outlook National small business asset finance market estimated + to be $29.9b1 in FY20 72.9%1 of new commercial asset finance transactions Low interest rates + are settled through commercial brokers + coupled with a Extended government subsidies and lower interest rates are resulting in financiers r
Slide 21: Capital management
Capital management Cash and cash equivalents Efficient capital The Group has generated significant cash over the financial year and the proportionate share of unrestricted cash and term deposits attributable to members at 30 June 2021 was $50.4m (see Appendices). management resulted in a Dividend On
Slide 22: Capital management
Capital management Investments Corporate debt facility COG made the following investments during the financial year, in line with its acquisition The Group has a corporate debt facility with Bendigo Bank Limited. During the 12 months growth strategy: ended 30 June 2021, the Group met its contractual
Slide 23: Disclaimer
Disclaimer COG Financial services Limited ('COG’) has not considered the financial position Investors should also note that COG’s past performance, including past share or needs of the recipient in providing this presentation ('Presentation'). Persons price performance, cannot be relied upon as an i
Slide 24: Appendices
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Slide 25: Statutory income statement
Appendices Statutory income statement Impairment relates to the write off of goodwill and other intangibles in the Lending business, in For the year ended 30 June 2021 2020 Pcp connection with the restructuring of the business, $m $m Change following taking a 51% controlling interest in Westlawn. Th
Slide 26: Reconciliation between statutory NPAT and underlying NPATA
Appendices Reconciliation between statutory NPAT and underlying NPATA Members and NCI 1 Members For the year ended 30 June 2021 2020 Variance 2021 2020 Variance $m $m $m $m $m $m Statutory NPAT (17.4) (5.4) (12.0) (26.4) (10.0) (16.4) Adjustments (after tax): Impairment 37.3 11.7 25.6 37.2 11.5 25.7
Slide 27: Acquisition history
Appendices Acquisition history Interest Date Company Activity Acquirer acquired Price Consideration Platform Consolidated Dec-15 Aggregation platform + ownership of finance brokers COG 60% $22.9m 76% cash/ 24% equity Group (PCG) Largest independent specialist equipment finance Oct-16 Consolidated Fi
Slide 28: Acquisition history (continued)
Appendices Acquisition history (continued) Interest Date Company Activity Acquirer acquired Price Consideration Jul-19 QPF Holdings Acq of outstanding minority interests COG Outst. 5.6% $1.7m 100% cash 1 Oct-19 Platform Consolidated Group Acq of outstanding minority interests COG Outst. 3.6% $1.1m 5
Slide 29: Proportionate share of unrestricted cash attributable to members
Appendices Proportionate share of unrestricted cash attributable to members COG direct Proportionate Ownership share Total Restricted Unrestricted in the Holding attributable to Cash cash1 cash Company Members PCG Group 13.0 (6.8) 6.1 70% 3.7 QPF Group 3.7 - 3.7 57% 1.9 Linx Group 3.3 3.3 55% 1.5 We