Slide 1: AUB Group Ltd Annual Results FY2016
AUB GROUP LTD ANNUAL RESULTS FOR THE YEAR ENDED 30 JUNE 2016 (FY2016) 25th AUGUST 2016
Slide 2: Notice
NOTICE SUMMARY INFORMATION This document has been prepared by AUB Group Limited (ABN 60 000 000 715) (AUB). It is a presentation of general background information about AUB’s activities current at the date of the presentation. It is information in a summary form and does not purport to be complete.
Slide 3: Overview
OVERVIEW MARK SEARLES MANAGING DIRECTOR & CEO
Slide 4: FY16 Results Highlights
FY16 RESULTS HIGHLIGHTS Group continues to deliver growth despite challenging market conditions. REPORTED NPAT GROWTH +20.4% Including after tax profit on sale of Strathearn ADJUSTED NPAT GROWTH +3.3% STRONG REPORTED EPS GROWTH +17.1% FY16 DIVIDEND INCREASED to 40cps Final dividend of 28 cents GROUP
Slide 5: Group's Disciplined Approach Delivering
GROUP’S DISCIPLINED APPROACH DELIVERING Business model, Operating model and Group strategy supporting continuous growth. $’000s 70,250 60,250 50,250 40,250 30,250 20,250 10,250 250 FY12 FY13 FY14 FY15 FY16 Total Australian Broking profit Total Brokers Profit/Agencies/Risk services/NZ Corporate Expen
Slide 6: Performance Highlights
PERFORMANCE HIGHLIGHTS Growth drivers across all segments. AUSTRALIAN BROKING NEW ZEALAND BROKING ORGANIC GROWTH DIVISION GROWTH TOTAL INCOME +2.1% GWP >$520M POLICY COUNT +1.0% TOTAL INCOME +146% PREMIUM FUNDING +2.7% PROFIT CONTRIBUTION +883% LIFE INSURANCE INCOME +7.0% ORGANIC GROWTH (PBT) 31% NE
Slide 7: Financial Performance
FINANCIAL PERFORMANCE JODIE BLACKLEDGE CFO
Slide 8: Key Results
KEY RESULTS Growth in a challenging market. • Reported NPAT increased to $42.0m up 20.4% on FY15, FY16 FY15 GROWTH including $6.2m after tax profit realised on sale of associates. REVENUE FROM ORDINARY 233,878 217,347 7.6% ACTIVITIES ($000S) • Adjusted NPAT increased 3.3% to $37.6m. REPORTED NPAT 42
Slide 9: AUB Group Profit Contribution Analysis
AUB GROUP PROFIT CONTRIBUTION ANALYSIS Benefits of group diversification delivering. Strong growth contribution from Risk Services and New Zealand demonstrates benefits of strategy and resultant income diversification. Adjusted Profit Contribution to AUB Group (after tax and non-controlling interest
Slide 10: Insurance Broking - Australia
INSURANCE BROKING - AUSTRALIA Organic income growth in a tough market. • Organic Broker profits1 (before non controlling interests) increased in the context of falling premium rates and interest rates. This was achiev • ed through focusing on the growth levers that partners can control (life insuran
Slide 11: Insurance Broking – New Zealand
INSURANCE BROKING – NEW ZEALAND Performing ahead of expectations. • Pre-tax profit contribution to AUB Group of $2.9m ($0.3m in FY15). • Having entered NZ 18 months ago, AUB Group NZ (including NZbrokers) are the 3rd largest broking group by GWP in the market and performance is ahead of expectations
Slide 12: Underwriting Agencies
UNDERWRITING AGENCIES Strong policy growth and profit commissions in a competitive market. • Revenues impacted by a reducing premium rate environment (down 9% on average), exacerbated by strong competition in Strata and Plant & Equipment and higher levels of investment (expensed) in developing futur
Slide 13: Underwriting Agencies
UNDERWRITING AGENCIES Strong policy growth and profit commissions in a competitive market. C h an ge i n Average Premi u m Rates vs • Average premiums down 9% in FY16 impacted by Po l i c y Co u nt FY1 6 premium rates and product mix. • However, underlying ‘Commission and Fee’ income Average Premium
Slide 14: Risk Services
RISK SERVICES Growing profit and capability. • Profit increased to $7.2m from strong organic growth, acquisitions by partners, and a full year contribution from Allied Health. • Organic growth in injury management and rehabilitation services underpinned by expanding insurer relationships, a broadeni
Slide 15: Balance Sheet & Funding
BALANCE SHEET & FUNDING Balance sheet remain strong with increase facility for acquisitions. Group balance sheet: GROUP BALANCE SHEET ($M) FY16 FY15 • Investments (the aggregate of Investments in Associates CASH 70.9 50.5 and Intangible Assets and Goodwill) have increased by $39.1m due to acquisitio
Slide 16: Dividends Per Share
DIVIDENDS PER SHARE • Final dividend per share of 28 cents bringing full year dividend to 40 cents. • No DRP offered for final dividend, with the group preferring to utilise cash and debt capacity in the current low interest rate environment. 38.5 39.7 40.0 40 35.5 35 31.0 30 25.5 25 26.5 27.7 28.0
Slide 17: FY17 Priorities & Outlook
FY17 PRIORITIES & OUTLOOK FY17 PRIORITIES Continued disciplined focus, building on the strength of our Business Model; Operating Model and Group Strategy. • Business Model: leverage ‘skin in the game’ model to continue to drive both organic growth and via acquisition. Two investments already complet
Slide 18: Appendices
APPENDICES AUB Group Ltd FY16 Results
Slide 19: Appendix - Adjusted NPAT
APPENDIX 1 - ADJUSTED NPAT R EC ON C IL IATION OF AD JU STED N PAT TO R EPOR TED N PAT ( 1) F Y2016 F Y2015 Var ianc e $ 000 $ 000 % Net Profit after tax attributable to equity holders of the parent 42,002 34,887 20.4% Reconciling items net of tax and non controlling interest adjustments for: Adjust
Slide 20: Appendix – Management Results
APPENDIX 2 – MANAGEMENT RESULTS(1) MAN AGEMEN T PR ESEN TATION OF R ESU L TS F Y2016 F Y2015 Var ianc e $ 000 $ 000 % Australian Broking revenue 308,316 312,816 -1.4% Australian Broking expenses (221,196) (224,613) -1.5% Net profit - Australian Broking 87,120 88,203 -1.2% Profit attributable to othe
Slide 21: Appendix – Cashflow
APPENDIX 3 – CASHFLOW C ASH FL OW F Y2016 F Y2015 $ 000 $ 000 Cash flows from operations 34,038 41,520 Cash flows from investing activities Acquisitions¹ (45,105) (35,861) Prepayment for acquisition of controlled entity Proceeds from disposal of associates Cash out flow from Deconsolidation of contr
Slide 22: Appendix – Operating Segment Reconciliation
APPENDIX 4 – OPERATING SEGMENT RECONCILIATION R EC ON C IL IATION OF OPER ATIN G SEGMEN TS Cons olidated Cons olidated F Y2016 F Y2015 Insurance Risk Insurance Risk Total Total Intermediary Services Intermediary Services $000 $000 $000 $000 $000 $000 Profit before tax and after non-controlling inter
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