Hitech Group Australia Limited · ASX:HIT
Hitech Group Australia — H1 FY2018 Earnings Presentation
22 slides from Hitech Group Australia's earnings presentation, Feb 22, 2018
Slide 1: Half Year Results Presentation (ASX Code: HIT)
Half Year Results Presentation (ASX Code: HIT) 22 FEBRUARY 2018
Slide 2: HiTech overview
HiTech overview • HiTech Group Australia Limited is a specialist provider of recruitment and Cloud ICT consulting services Computing & IoT • The term information and communications technology (ICT) is generally accepted to mean all technologies that, combined, allow people and Cyber Applications org
Slide 3: Key Investment Considerations
Key Investment Considerations HiTech is in a strong and unique position to be a key beneficiary of the fast growing technology sector in Australia Stable & experienced Fast growing Changing towards leadership team technology market contingent workforce in Australia Robust financials Long term and Im
Slide 4: Board of Directors
Board of Directors Qualifications: BA (Sydney University), DipEd. Raymond Hazouri Experience: Founded HiTech in 1993 and has over 27 years’ experience in the IT industry. Prior to establishing HiTech, Ray worked in a number of capacities in the information technology industry ranging from management
Slide 5: Australia ICT industry overview
Australia ICT industry overview Historical & Forecast ICT Employment, Selected Sector Spending⁽²⁾ 2011-22⁽¹⁾ A$ BN 2011 2016 2022 30 2016 2019 300,000 25.70 25 250,000 22.00 20 200,000 150,000 15 10.50 9.40 100,000 10 50,000 5 0 0 ICT ICT technical ICT sales ICT trades Electronic ICT industry IT Ser
Slide 6: Demand for contingent workforce in Australia continues to rise…
Demand for contingent workforce in Australia continues to rise… 2015 Contingent Workforce 2020 Contingent Workforce 30% Contingent Workforce 50% 50% Non Contingent Workforce 70% 975m Contingent Workers Globally, ~30% of 1.75b Contingent Workers Globally, ~50% total global workforce of total global w
Slide 7: HiTech FY2017 & 1H FY2018 results highlights
HiTech FY2017 & 1H FY2018 results highlights 2015 2016 2017 1H 2016 1H 2017 1H 2018 A$ M A$ M 25 23.32 15 13.28 20 18.26 11.15 15.04 10 15 8.17 10 5 5 0 0 Revenue Revenue • FY2017 Revenue up 27% driven by 28% growth in contracting and 13% growth in permanent placement revenue • FY 2017 is the compan
Slide 8: HiTech FY2017 & 1H FY2018 results highlights cont’d
HiTech FY2017 & 1H FY2018 results highlights cont’d 2015 2016 2017 1H 2016 1H 2017 1H 2018 A$ M A$ M 5 3 4 3.43 2 3 1.60 2.19 1.24 2 0.99 1.35 1 1 0 0 Underlying EBITDA Underlying EBITDA • Underlying EBITDA continues to grow steadily • 1H FY2018 Underlying EBITDA increased by an impressive 29% over
Slide 9: HiTech FY2017 & 1H FY2018 results highlights cont’d
HiTech FY2017 & 1H FY2018 results highlights cont’d 2015 2016 2017 1H 2016 1H 2017 1H 2018 A$ M A$ M 4 2.0 3 1.5 2.41 1.07 2 1.0 1.59 0.84 0.69 1 0.81 0.5 0 0.0 Underlying NPAT Underlying NPAT • An interim dividend for 1H FY2018 of 4 cents fully franked has been declared payable on 19 March 2018, wh
Slide 10: Strong Balance Sheet and financial discipline
Strong Balance Sheet and financial discipline Quick Ratio⁽¹⁾ Net Debt⁽²⁾ 6.00x A$ M 4.96x 0 4.87x 5.00x -1 4.00x -2 3.36x -1.84 3.00x -3 2.56x -4 2.00x -4.41 -5 1.00x -5.21 -6 -5.94 0.00x -7 2015 2016 2017 1H 2018 2015 2016 2017 1H 2018 HiTech is a resilient and strong company with a robust balance
Slide 11: Specialised service with a winning formulae for success
Specialised service with a winning formulae for success • HiTech works closely with select, identified blue chip client base names on talent acquisition • Management intimately understands the key drivers of recruitment and ICT consulting services for its clients • Continually seeking out permanent
Slide 12: HiTech revenue breakdown
HiTech revenue breakdown 1H FY2018 Revenue Breakdown - Top 10 Clients Average History of Service by Client Type Concentration 19% Australian Govt (Federal & State) Private Sector 81% Years 0 4 8 12 16 20 + Top 10 Others • HiTech has a long history and robust working relationship with its key establi
Slide 13: Stable client base – majority are Federal Government clients
Stable client base – majority are Federal Government clients 1H FY2018 Revenue Breakdown – Client Type 1.00% 4.00% 1.00% 2.00% 8% 2.00% 2.00% 2% 2.00% 16.00% 4.00% 4.00% Further breakdown of 4.00% 1H FY2018 Federal Govt Revenue 4.00% 10.00% 4.00% 4.00% 13.00% 7.00% 90% Federal Department 1 Federal D
Slide 14: HiBase - proprietory, predictive database of ICT talent
HiBase - proprietory, predictive database of ICT talent • HiBase is a predictive intelligence tool built by HiTech for sourcing talent • A comprehensive up to date database of over 360,000 professional candidates for contract or permanent positions • The HiTech Services team is at the forefront of t
Slide 15: Overcoming any technology and competitor disruptions
Overcoming any technology and competitor disruptions • HiTech works at the forefront of specialist ICT services • The human element to this work is critical and irreplaceable • Human interaction and decision making will not disappear for critical ICT projects and assignments • “Automated platforms”,
Slide 16: Consistent track record is being rewarded in share price….
Consistent track record is being rewarded in share price…. Volume in K HIT Market Cap Price A$ HIT’s Market Capitalisation A$ reached A$30M on 28 1,800 1.00 Nov 2017 Closing price as of 21-Feb-18 $0.90/share 1,600 0.90 52-week high on 02-Feb-18 $0.95/share 0.80 52-week low on 02-May-17 $0.52/share 1
Slide 17: …but with significant upside left versus ASX Listed peers
…but with significant upside left versus ASX Listed peers HiTech Group⁽¹⁾ Peer 1 Peer 2 Peer 3⁽² ⁾ Peer 4 ⁽³ ⁾ Peer 5 ⁽⁴ ⁾ Peer 6 Peer 7⁽¹⁾ Shares on issue M 35.15 89.58 67.17 243.87 64.04 117.96 103.87 143.98 Share Price A$ 0.90 0.10 0.16 0.04 1.46 0.12 0.35 0.18 Market Capitalisation A$ M 31.64 8.
Slide 18: …but with significant upside left versus ASX Listed peers cont.
…but with significant upside left versus ASX Listed peers cont. HiTech Group⁽¹⁾ Peer 8⁽² ⁾ Peer 9 Peer 10 Peer 11 Peer 12 Peer 13⁽³ ⁾ Peer 14 Shares on issue M 35.15 251.49 171.46 154.18 61.52 131.07 515.50 414.95 Share Price A$ 0.90 0.97 0.09 0.17 0.08 0.61 0.02 0.02 Market Capitalisation A$ M 31.6
Slide 19: A simple 2 Tier growth strategy
A simple 2 Tier growth strategy - On-boarding of new clients Organic Growth - Enhance the service offering provided to existing clients by providing a broader suite of recruitment and ICT consulting solutions in addition to base contracting agreements - Expand the company’s ICT offering into high ma
Slide 20: Investment highlights – Investor proposition
Investment highlights – Investor proposition - 4 cents fully franked interim dividend was declared in 1H FY2018, bringing total dividends for the last 12 months to 7 cents fully franked Dividends - Annualised gross dividend yield of about 12.7% at the current share price of 90 cents* - Current inten
Slide 21: Contact information
Contact information Elias Hazouri CEO elias@hitechaust.com (02) 9241-1919 www.hitechaust.com Level 9, 189 Kent street, Sydney, NSW 2000, Australia 21
Slide 22: Important information and disclaimer
Important information and disclaimer This presentation has been prepared by HiTech Group Australia Limited ABN: 41 062 067 878 (“HiTech”). This document contains background information about HiTech current at the date of this presentation. The presentation is in summary form and does not purport be
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