Slide 1: DSW Capital plc Full Year Results FY24
DSW Capital plc Full Year Results FY24 July 2024
Slide 2: Disclaimer
Disclaimer Insert logo here The following presentation, including a hard copy of these slides/the talks given by the presenters, the information communicated during any delivery of the presentation and any question and answer session and any document or material distributed at or in connection with
Slide 3: Today's Presenters
Today’s Presenters Executive Directors James Dow Pete Fendall Chief Executive Officer Chief Operating Officer & James established Dow Schofield Watts LLP in Interim Chief Financial Officer 2002. Pete joined DSW Capital in September 2021 to James is qualified as both a Chartered support with the IPO,
Slide 4: Overview of DSW
Overview of DSW Insert logo here Joined AIM Dec 21 • Challenger “Big 4” mid market professional services network. • 107 licenced fee earners (“FE”) predominantly trading under the DSW brand with 11 locations across the UK. • Licence fee is charged typically on a percentage of revenue. • Provide the
Slide 5: Investment Case
Investment Case Insert logo here Capital light Scalable and innovative platform model Large market ripe for disruption Recurring revenue base Continued strong growth in Fee Earners The AIM listing is important. It has: • increased our profile to partner candidates; • provided capital for the acquisi
Slide 6: Current Service Lines
Current Service Lines Insert logo here Corporate Business Financial Business Tax Advisory Finance Recovery Due Diligence Planning FE=6 Advisory FE=20 FE=18 FE=7 FE=39 Venture Capital Debt Advisory Asset Based Wealth Planning Fractional Equity Finance Funding FE=4 Lending Risk FE = 1 Support* FE=4 FE
Slide 7: The DSW Licence Model
The DSW Licence Model Insert logo here Empowering ambitious professionals to build their own business We recruit highly skilled professionals (typically “Big 4”) in focussed niches of expertise to run their own business and provide services to small to mid market corporates and their owner managers.
Slide 8: The DSW Licence Model
The DSW Licence Model Insert logo here Strengths to DSW Capital Strengths to the Licensee Strong perceptions of credentials and Recurring income. capability. Minimal exposure to property and employee Cross referrals and access to multidisciplinary costs. services. Easier recruitment, central marketi
Slide 9: Central Initiatives
Central Initiatives Our initiatives this year have sought to Hosted first annual Established ESG strengthen the business model in three key DSW Employee Committee Conference areas: 45% of Employees and Invested in Partner 1 To attract new recruits and enhance value provided to existing licensees Par
Slide 10: FY24 Performance Highlights
FY24 Performance Highlights Insert logo here • Network Revenue of £16.0m (FY23: £18.3m) – a reduction of 12.5% against a challenging macro-economic Network Revenue (£m) background. 18.3 18.3 15.3 16.0 • Income from licensees* decreased 18.9% to £2.4m 12.4 8.5 11.0 • Underlying EBITDA+ decreased by 5
Slide 11: FY24 Income Statement
FY24 Income Statement Insert logo here £000s Mar-24 Mar-23 Key Highlights Portfolio Income 15,975 18,262 • Subdued M&A activity led to reduced Licence Licence Income 2,183 2,550 income despite growth in Fee Earners. Profit Share Income* 248 408 • Profit share income reduced by 39.2% due to Sale of i
Slide 12: FY24 Balance Sheet
FY24 Balance Sheet Insert logo here £000s Mar-24 Mar-23 £000s Mar-24 Mar-23 Non-current assets Net current assets 4,278 5,651 Intangible assets 696 748 Non-current liabilities Property, plant and equipment 363 440 Lease liability 218 220 Lease receivable 82 - Dilapidation provision 80 75 Investments
Slide 13: Cash Flow Statement
Cash Flow Statement Insert logo here £000s Mar-24 Mar-23 £000s Mar-24 Mar-23 Cash flows from operating activities Operating cash conversion* (%) 14% 88% Profit for the year 84 485 Operating cash conversion before 61% 101% Adjustments for tax, interest, non-cash items 541 1,051 loans to new start-ups
Slide 14: Network KPIs
Network KPIs Insert logo here LTM Portfolio Revenue vs. Fee Earners Fee Earners 107 19 120 10.3% YOY growth 18 100 17 80 Network Revenue £16.0M 16 60 15 40 12.5% decline on PY 14 20 13 0 15.4% 1:1.1 FY21 FY22 FY23 FY24 Partner to Employee Average Licence Fee (2023: 16.6%) ratio LTM Portfolio Revenue
Slide 15: Opportunities for growth
Opportunities for growth Insert logo here Acquisition of “Break-outs” licence fees Organic Service line growth extension Geographical expansion Dow Schofield Watts 15
Slide 16: Target Acquisition Service Lines
Target Acquisition Service Lines Insert logo here High margin, high growth, niche professional services where there is a strong synergistic fit. Existing service lines in new locations. Tax-related services and family office. Niche legal services. Other Big 4 (non-audit) service lines. Dow Schofield
Slide 17: Recruitment
Recruitment Insert logo here In FY24, we invested £0.2m to bolster our Partner Recruitment capabilities, which contributed to 13 New Partners – A 19% net increase YoY. Our investment allows us to take advantage of the increased “push” factors encouraging people to seek new opportunities, such as del
Slide 18: Our ESG journey
Our ESG journey Insert logo here In FY24, we established our ESG Committee made up of representatives from across the organisation, to drive forward our ESG initiatives across all four cornerstones. Social & Environmental Impact Diversity & Inclusion • Reduced our Scope 1 Emissions by 53.4% • Intern
Slide 19: Summary and Outlook
Summary and Outlook Insert logo here Summary • Network Revenue of £16.0m (FY23: £18.3m) – a decline of 12.5% against an economically challenging background • 30.5% increase in FEs since the admission to AIM in December 2021, just over two years ago - heightened profile and licence model driving recr
Slide 20: Questions
Questions Questions 2020
Slide 21: Appendices
Appendices Appendices 2121
Slide 22: Summary Investment Thesis
Summary Investment Thesis Insert logo here Why invest? Robust, recurring income stream. Predictable cost base with low operational gearing. Capital light. Scalable platform model. Significant opportunity for organic and acquisition driven growth. Cash backed profits which have supported 9.98 pence p
Slide 23: The accountancy profession is ready for something new
The accountancy profession is ready for something new….. The “Big 4” are under significant pressure to restructure DSW Differentiators: Partners also continue to benefit from: International Being part of A direct link 100% Central network - Greater a multi- Pandea between fees operational infrastruc
Slide 24: Timeline of the Business
Timeline of the Business Insert logo here DSW Network has grown steadily to a team of 107 FE working in 11 service lines (31 March 2024) July 2023- Aug 2021 – DSW Bridgewood May 2012 – launched Launch of Debt joins the network DSW CF Advisory DSW Forensics based Advisory London in the North West Dec
Slide 25: Contact Us
Contact Us Burscough Cardiff Cheadle Daresbury Leeds 702 Merlin Business Park The Maltings The Camlee Group 7400 Daresbury Park Cubo, 3rd Floor Ringtail Rd E Tyndall St Eden Point Daresbury 6 Wellington Place Burscough Cardiff Three Acres Ln Warrington Leeds Ormskirk CF24 5EA Cheadle Hulme WA4 4BS L