Mcmillan Shakespeare Limited · ASX:MMS

Mcmillan Shakespeare — H1 FY2015 Earnings Presentation

28 slides from Mcmillan Shakespeare's earnings presentation, Feb 24, 2015

  1. Slide 1: MMS Group 1HFY15 Results Presentation

    For personal use only MMS Group 1HFY15 Results Presentation February 2015

  2. Slide 2: Overview

    MMS Group 1HFY15 Results Presentation 2 Overview For personal use only  MMS entering a new stage of development, growth and profitability  Using MMS financial strength and strong cash generation to build a stronger and diversified business  Allocating capital in a disciplined, accretive way with

  3. Slide 3: 1HFY15 key points

    MMS Group 1HFY15 Results Presentation 3 1HFY15 key points For personal use only  Half year NPAT of $31.1m, 62% higher than PCP and 5% higher than 1HFY13  1H profit result largely impacted by:  Reduction in revenue from novated leasing due to temporary contract suspension  Business continues to p

  4. Slide 4: 1HFY15 key points (continued)

    MMS Group 1HFY15 Results Presentation 4 1HFY15 key points For personal use only  UK business building solid momentum  Productivity improvements from our IT investment continue  Guaranteed Future Value product has been well received by the market  Significant contract wins and a good pipeline of

  5. Slide 5: Consolidated financial performance

    MMS Group 1HFY15 Results Presentation 5 Consolidated financial performance For personal use only % % 1HFY15 1HFY14 change 1HFY15 1HFY14 change 1HFY15 1HFY14 % change 1HFY13 % change $000 Group Group Asset Asset Remuneration Remuneration Services Services Management Management (1) Total Total Total R

  6. Slide 6: Financial highlights

    MMS Group 1HFY15 Results Presentation 6 Financial highlights For personal use only  Consolidated NPAT $31.1m (62% growth on PCP, 5% growth on 1HFY13)  Group Remuneration Services NPAT $24.6m (86% growth on PCP, 12% growth on 1HFY13). Costs well controlled  Asset Management NPAT $6.2m (3% less tha

  7. Slide 7: Earning per share

    MMS Group 1HFY15 Results Presentation 7 Earning per share For personal use only 50.00 45.00 40.00 Basic EPS 9-year CAGR of 19.8% 35.00 30.00 cents 25.00 20.00 15.00 10.00 5.00 0.00 1H FY06 1H FY07 1H FY08 1H FY09 1H FY10 1H FY11 1H FY12 1H FY13 1H FY14 1H FY15 Basic EPS Cash EPS Cash EPS after CAPEX

  8. Slide 8: Dividends per share

    MMS Group 1HFY15 Results Presentation 8 Dividends per share For personal use only 30.0 25.0 Interim Dividend 9 year CAGR 29% 25.0 24.0 22.0 20.0 21.0 15.0 16.0 cents 10.0 10.0 8.5 7.5 5.0 4.5 2.5 0.0 1H FY06 1H FY07 1H FY08 1H FY09 1H FY10 1H FY11 1H FY12 1H FY13 1H FY14 1H FY15

  9. Slide 9: NPAT Performance

    MMS Group 1HFY15 Results Presentation 9 NPAT Performance For personal use only 35 30 31.1 29.7 NPAT 9 year CAGR 21.6% 25 24.9 20 20.5 19.3 $m 15 10 11.2 9.5 7.9 5 6.1 5.3 0 1H FY06 1H FY07 1H FY08 1H FY09 1H FY10 1H FY11 1H FY12 1H FY13 1H FY14 1H FY15

  10. Slide 10: Definition of Segments

    MMS Group 1HFY15 Results Presentation 10 Definition of Segments For personal use only Group Remuneration Services segment definition: The segment provides administrative services in respect of salary packaging and facilitates the settlement of motor vehicle novated leases for customers, but does not

  11. Slide 11: Group Remuneration Services financial performance

    MMS Group 1HFY15 Results Presentation 11 Group Remuneration Services financial performance For personal use only 1HFY15 1HFY14 % change 1HFY13 % change $000 Segment revenue (1) 82,801 70,548 17% 75,757 9% Expenses Employee expenses 34,569 34,655 - 30,891 12% Depn and amort of PPE and software 2,178

  12. Slide 12: Group Remuneration Services commentary

    MMS Group 1HFY15 Results Presentation 12 Group Remuneration Services commentary For personal use only  1HFY15 NPAT of $24.6m was $11.3m or 86% higher than PCP and 12% higher than 1HFY13  Business momentum disrupted in the first quarter, momentum rebuilt and finished the half well  Improving parti

  13. Slide 13: Group Remuneration Services commentary

    MMS Group 1HFY15 Results Presentation 13 Group Remuneration Services commentary For personal use only  IT based projects well embedded and delivering further productivity improvements  Maintained customer metrics above benchmarks  Business has good momentum going into the 2H and has started well

  14. Slide 14: Competitive strengths and performance indices

    MMS Group 1HFY15 Results Presentation 14 Competitive strengths and performance indices For personal use only Group Remuneration Services Productivity Index (7/08 = 100) MMS Customer Satisfaction Index [Rolling 3 month Revenue (ex SP Interest) / FTE] December 2008 = 100 170 300 165 160 155 250 150 14

  15. Slide 15: Group Remuneration Services financial performance

    MMS Group 1HFY15 Results Presentation 15 Group Remuneration Services financial performance For personal use only 100 100.0% 90.0% Revenue 9-year CAGR 15.2% PBT 9-year CAGR 20.3% 80 83 80.0% 76 70.0% 71 60 64 60.0% $m 54 50.0% 40 44 40.0% 38 34 30.0% 32 31 26 26 20 23 20.0% 21 20 16 14 10.0% 11 6 9 0

  16. Slide 16: Presidian group structure

    MMS Group 1HFY15 Results Presentation 16 Presidian group structure For personal use only “Finance Finance Businessˮ “Warranty Warranty Businessˮ “Insurance Insurance Businessˮ Manufacturer of extended Aggregator of finance, Provider of motor vehicle warranty products for vehicle, insurance and warra

  17. Slide 17: Extension of existing virtual car dealership model

    MMS Group 1HFY15 Results Presentation 17 Extension of existing virtual car dealership model For personal use only 6 After market products 1 Vehicle management  Provide fuel, tyres and other  Ability to procure new vehicles and after market services dispose of motor vehicles  Fleet management 2 As

  18. Slide 18: Presidian summary

    MMS Group 1HFY15 Results Presentation 18 Presidian summary For personal use only  Earnings accretive acquisition that complements our core competencies  Second hand car market is three and a half times larger than the new car market  Combined opportunity to improve financial arrangements is subst

  19. Slide 19: Asset Management (AM) financial performance

    MMS Group 1HFY15 Results Presentation 19 Asset Management (AM) financial performance For personal use only 1HFY15 1HFY14 % change AM segment UK Australia AM segment UK Australia AM segment Australia $000 Segment revenue (1) 98,374 7,460 90,914 90,978 5,461 85,517 8% 6% Expenses Depreciation of motor

  20. Slide 20: Asset Management commentary

    MMS Group 1HFY15 Results Presentation 20 Asset Management commentary For personal use only  Assets under finance – growth continues ($19m or 6% since June 30) to $353m  Market remains highly competitive with pressure on NIM and management fees  Strong residual value performance. Used car prices i

  21. Slide 21: Asset Management (UK) commentary

    MMS Group 1HFY15 Results Presentation 21 Asset Management (UK) commentary For personal use only  UK business building momentum  New business growth  Building the brand reputation in the market  Retail sales model supplemented with wholesale funding panel  Assets under finance grew by A$23m  Ma

  22. Slide 22: Fleet Assets WDV

    MMS Group 1HFY15 Results Presentation 22 Fleet Assets WDV For personal use only 400 5.9% 8.3% 0.3% 350 353 15.9% 1.4% 333 334 300 303 307 9.4% 8.6% ($m) 250 262 Growth 0.5% 2.6% 239 200 215 220 213 214 150 100 50 0 Acquisition 1 30-Jun-10 31-Dec-10 30-Jun-11 31-Dec-11 30-Jun-12 31-Dec-12 30-Jun-13 3

  23. Slide 23: Asset Management key balance sheet numbers

    MMS Group 1HFY15 Results Presentation 23 Asset Management key balance sheet numbers For personal use only 31-Dec-14 30-Jun-14 Movement $000 Operating lease assets 301,099 303,408 (2,309) Motor vehicle inventories 4,479 5,379 (900) Finance leases & CHP 47,869 24,906 22,963(1) Total funded fleet asset

  24. Slide 24: Gearing

    MMS Group 1HFY15 Results Presentation 24 Gearing For personal use only MMS & Group Remuneration Asset Group Group Services Management Balance at Balance at 31-Dec-14 31-Dec-14 31-Dec-14 30-Jun-14 $000 Net debt (92,272) 233,717 141,445 143,903 Book value of equity 119,891 128,336 248,227 223,847 Gear

  25. Slide 25: 1HFY15 Cashflow

    MMS Group 1HFY15 Results Presentation 25 1HFY15 Cashflow For personal use only Group Remuneration Asset Unallocated / MMS Group Services Management parent co. Total $000 Segment NPAT 24,579 6,210 338 31,127 Non-fleet depn/amort, reserves and other non-cash items 3,305 3,288 - 6,593 Working capital i

  26. Slide 26: Funding

    MMS Group 1HFY15 Results Presentation 26 Funding For personal use only  In FY14 the Asset Management facility limit was increased and extended to March 2017  During the half the UK facility was increased by a further £12m to £37m (unused £20m)  The Australian facility remains at A$300m (unused $1

  27. Slide 27: Risk sensitivities

    MMS Group 1HFY15 Results Presentation 27 Risk sensitivities For personal use only  Interest rates (earnings on float)  Second hand car prices (remarketing earnings)  New car sales (novated lease participation)  Government austerity/redundancy programs  Delivery of new IT programs/increased depr

  28. Slide 28: Outlook

    MMS Group 1HFY15 Results Presentation 28 Outlook For personal use only  Ongoing organic profitable growth through:  New business and cross-sell from our stronger integrated value proposition, competitive cost of funds and flexible financing facilities  Increasing participation rates within existi

McMillan Shakespeare — H1 FY2015 Earnings Presentation on 6ix