Aub Group Limited · ASX:AUB
Aub — H1 2017 Earnings Presentation
23 slides from Aub's earnings presentation, Feb 27, 2017
Slide 1: AUB Group Ltd Half Year Results
AUB GROUP LTD HALF YEAR RESULTS FOR THE PERIOD ENDED 31 DECEMBER 2016 (1H17) 27TH FEBRUARY 2017
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: 1H17 First Half Results Highlights
1H17 FIRST HALF RESULTS HIGHLIGHTS Group continues to drive growth with focussed approach. ADJUSTED NPAT1 GROWTH +12.7% ADJUSTED EPS1 GROWTH +10.5% 1H17 INTERIM DIVIDEND INCREASED TO 12.5 CENTS PER SHARE +4.2% GROUP REVENUE INCREASED +15.0% Increase from 1H16: $105.9M to 1H17: $121.8M 1 Adjusted NPA
Slide 5: Group's Disciplined Approach Delivering
GROUP’S DISCIPLINED APPROACH DELIVERING Business model, Operating model and Group strategy supporting continuous growth. $m 70 60 50 40 30 20 10 - 12 months ended FY12 FY13 FY14 FY15 FY16 Dec-16 Total Australian Broking profit Total Group pre-tax Profit before Corporate Expenses Corporate Expenses (
Slide 6: Performance Highlights
PERFORMANCE HIGHLIGHTS Growth drivers across all segments. AUSTRALIAN BROKING NEW ZEALAND BROKING PROFIT CONTRIBUTION INCREASE PROFIT CONTRIBUTION INCREASE +$1.9m (inc divestment vs pcp1) +0.4% NEW ACQUISITIONS BY EQUITY PARTNERS +2 ORGANIC GROWTH (before NCI )2 +5.3% EXPANDED BROKING GROUP FOOTPRIN
Slide 7: Financial Performance
FINANCIAL PERFORMANCE JODIE BLACKLEDGE CFO
Slide 8: Key Results
KEY RESULTS Growth in all businesses in a stablising premium rate environment. • Revenue2 up 15.0% pcp1 with growth across all business 1H17 1H16 GROWTH areas. REVENUE FROM ORDINARY 121,825 105,938 15.0% • Adjusted NPAT increased 12.7% to $14.5m. ACTIVITIES ($000S) 2 • Adjusted EPS growth increasing
Slide 9: AUB Group Profit Contribution Analysis
AUB GROUP PROFIT CONTRIBUTION ANALYSIS Execution of strategy delivers growth and diversification. Adjusted Profit Contribution to AUB Group (after tax and non-controlling interests) 18 17 16 15 14 MILLION $ 13 12 11 10 9 8 1H16 Risk Services New Zealand Australian Underwriting Divested Corporate Tax
Slide 10: Insurance Broking - Australia
INSURANCE BROKING - AUSTRALIA Organic growth in stabilizing market. • Organic Broker profits1 (before non-controlling interests) increased with premium rates stabilizing, growth in other income sources (life insurance, client and policy count) and maintaining expense growth below revenue growth. • P
Slide 11: Insurance Broking - New Zealand
INSURANCE BROKING – NEW ZEALAND Increasing scale and further consolidating market position. • Pre-tax profit contribution to AUB Group of $2.5m ($0.6m in 1H16), with a strong contribution from Runacres (not included in the prior comparable period). Organic growth delivered despite tough rate environ
Slide 12: Underwriting Agencies
UNDERWRITING AGENCIES Return to growth in a competitive market. • Pre tax profit contribution from Underwriting Agencies of $4.3m, up $0.7m (21%) on prior comparable period, with strong performances in plant & equipment and Commercial agencies and organic growth across the portfolio. • 12% growth in
Slide 13: Risk Services
RISK SERVICES Growing profit and capability. • Pre tax profit contribution increased to $3.5m with acquisitions by equity partners and organic growth. • Growth in injury management and rehabilitation services underpinned by expanding insurer relationships, a broadening geographic footprint and conti
Slide 14: Balance Sheet & Funding
BALANCE SHEET & FUNDING Balance sheet remains strong. Group balance sheet: CONSOLIDATED BALANCE SHEET ($M) 31.12.16 30.06.16 • Investments (the aggregate of Investments in CASH 61.0 70.9 Associates and Intangible Assets and Goodwill) total $384.5m stable (30 June 2016: $380.6m), with CASH - TRUST 86
Slide 15: Dividends Per Share
DIVIDENDS PER SHARE • Interim dividend per share of 12.5 cents. • DRP remains suspended, with the group preferring to utilise cash and debt capacity in the current low interest rate environment. 39.7 40.0 40 38.5 35.5 35 31.0 30 25.5 25 22.5 26.5 27.7 28.0 CENTS PER SHARE 20.5 24.5 20 18.0 21.5 13.0
Slide 16: FY17 Priorities
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. Six investments by equity partners already completed in 1H
Slide 17: FY17 Outlook
FY17 OUTLOOK • There is evidence of premium rates stabilising in selected portfolios. The continuation of transition to a stable rate environment in Australia and New Zealand in FY17 and even targeted rate increase in underperforming segments is dependent on actions by insurers. • Drivers of revenue
Slide 18: Appendices
APPENDICES AUB Group Ltd FY16 Results
Slide 19: Appendix - Adjusted NPAT
APPENDIX 1 - ADJUSTED NPAT RECONCILIATION OF ADJUSTED NPAT TO REPORTED NPAT (1) 1H17 1H16 Variance $ 000 $ 000 % Net Profit after tax attributable to equity holders of the parent 12,404 23,788 -47.9% Reconciling items net of tax and non controlling interest adjustments for: Adjustments to contingent
Slide 20: Appendix - Management Results
APPENDIX 2 – MANAGEMENT RESULTS(1) MANAGEMENT PRESENTATION OF RESULTS 1H17 1H16 Varianc e $000 $000 Australian Broking revenue 143,613 148,212 -3.1% Australian Broking expenses (107,770) (112,951) -4.6% Net profit - Australian Broking 35,843 35,261 1.6% Profit attributable to other equity interests
Slide 21: Appendix - Cashflow
APPENDIX 3 – CASHFLOW CONSOLIDATED CASHFLOW 1H17 1H16 $ 000 $ 000 Cash flows from operations 27,391 13,130 Cash flows from investing activities Acquisitions (2,673) (14,166) Prepayment for acquisition of controlled entity - (33,974) Proceeds from disposal of associates - 28,930 Cash out flow from De
Slide 22: Appendix - Operating Segment Reconciliation
APPENDIX 4 – OPERATING SEGMENT RECONCILIATION RECONCILIATION OF OPERATING SEGMENTS Consolidated Consolidated 1H17 1H16 Insurance Risk Insurance Risk Intermediary Services To tal $ 000 Intermediary Services To tal $ 000 $ 000 $ 000 $ 000 $ 000 P ro fit befo re tax and after no n-co ntro lling interes
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