Slide 1: Annual General Meeting
For personal use only Annual General Meeting Deven Billimoria Managing Director and CEO 2 May 2018 PAGE 0
Slide 2: 2017 was another successful year for Smartgroup
2017 was another successful year for Smartgroup... For personal use only Continued good financial performance 1 - Revenue of $205.4m up 40% vs CY 2016 - NPATA(1) of $64.1m up 46% vs CY 2016 Continued client growth and diversification 2 - Organic growth of c.24,500 packages and c.2,900 leases - Expan
Slide 3: Growth across all financial and operational metrics
...with growth across all financial and operational metrics... For personal use only Change % CY 2017 Change % $m CY 2016 CY 2017 (CY17 v CY16) proforma(2) (CY17PF v CY16) Revenue 147.1 205.4 40% 226.8 54% EBITDA(1) 63.3 93.6 48% 100.6 59% NPATA 44.0 64.1 46% 68.5 56% Shares on issue (millions) 121.
Slide 4: Increasing shareholder returns
...and increasing shareholder returns. For personal use only (2) Revenue(1) EBITDA 120.0 50.0 45.0 49.0 100.0 107.9 44.6 40.0 97.5 35.0 37.7 80.0 84.7 30.0 $m $m 60.0 25.0 62.4 25.6 20.0 40.0 46.0 48.4 19.6 15.0 17.8 39.3 36.0 10.0 11.8 12.3 20.0 5.0 - - H1 2014 H2 2014 H1 2015 H2 2015 H1 2016 H2 20
Slide 5: Continued growth in salary packages and novated leases
Smartgroup has continued to grow salary packages and novated leases both organically and through acquisition … For personal use only (1) 1. CY 2015 package figure includes the acquisition of Advantage with c.50,000 packages, and a major client win of c.7,400 packages. CY 2016 and CY 2017 organic gro
Slide 6: Delivering strong EBITDA growth in 2017
... delivering strong EBITDA growth in 2017. For personal use only (2) (3) (1) (2) (2) (2) (3) (3) 1. CY 2015 acquisition – Advantage. Proforma is arrived at by including the pre-acquisition financial performance. 2. CY 2016 acquisitions – Smartequity, Autopia and Selectus. 3. CY 2017 acquisitions –
Slide 7: Continued growth and diversification of client base
Smartgroup has continued to grow and diversify its client base… For personal use only Given the growth in Smartgroup’s client base, the top 5 clients account for 29% of revenue vs 51% in 2013 (1). Smartgroup’s employer clients now total c.3,900 vs c.200 in 2013. Notes: Total revenue CY13: $62.4m, PF
Slide 8: Expanding its client footprint
... expand its client footprint … For personal use only (1) (1) Total packages (2) Total packages c. 105,000 c. 325,000 (2) 1. ‘Education’ includes public and private not-for-profit educational institutions. 2. ‘Hospitals’ includes public and private not-for-profit hospitals. PAGE 7
Slide 9: ...and extend its service offering
...and extend its service offering. For personal use only PAGE 8
Slide 10: Increase operational efficiency
Increase operational efficiency Digital channels at flagship Smartsalary brand have continued to see increasing levels of customer adoption. For personal use only Online processing uptake of high-volume Smartsalary(1) transactions 1. At Dec 2017, Smartsalary represented c.50% of total SIQ packages a
Slide 11: Recognised as one of Australia's most innovative companies
Smartgroup continues to be recognised as one of Australia’s most innovativeOur and strategy customer-centric companies… For personal use only Smartgroup capabilities triangle PAGE 10
Slide 12: Smartsalary highest customer service audit score
… and Smartsalary achieved the highest audit score awarded in the history of the Customer Service Institute of Australia, for the Award year. third consecutive winning customer service For personal use only PAGE 11
Slide 13: CY 2018 update
CY 2018 update For personal use only • The business continues to trade to plan o Client renewals and wins across SIQ businesses o Business and IT integration initiatives tracking to plan • Successful recent institutional placement and share purchase plan to strengthen Smartgroup’s balance sheet and
Slide 14: Building on our track record since inception
...building on our track record since company inception. For personal use only Revenue EBITDA 1. 2006 represents 18 months of results due to the change of year end from 30 Jun to 31 Dec. PAGE 13
Slide 15: Appendices
For personal use only Appendices PAGE 14
Slide 16: Record revenue and earnings in CY 2017
In CY 2017, Smartgroup delivered another year of record revenue and earnings. For personal use only Adjusted for M&A costs and $m CY 2017 non-operating CY 2017 CY 2016 statutory items(1) adjusted adjusted Change % Revenue(2) 205.4 - 205.4 147.1 40% EBITDA(3) 86.7 6.9 93.6 63.3 48% NPAT 41.3 7.1 48.4
Slide 17: After-tax operating cash flow at 99% of NPATA
After-tax operating cash flow(1) at 99% of NPATA, with continued low recurring capex. For personal use only $m CY 2017 CY 2016 Receipts from customers (inclusive of GST) 212.2 154.4 Payments to suppliers and employees (inclusive of GST) (2) (117.8) (94.2) Interest receipts from operations 1.8 1.6 In
Slide 18: Intangibles increased due to acquisitions
Smartgroup’s intangibles increased due to acquisitions, which were primarily funded by cash reserves. For personal use only 31 Dec 2017 31 Dec 2016 $m statutory statutory Cash 30.9 80.0 Restricted cash (1) 67.6 39.5 Trade and other current assets 26.7 22.9 1. Restricted cash and customer salary pack
Slide 19: Net debt / EBITDA c.1.2x at 31 December 2017
Due to consideration paid in respect of acquisitive activities, Net debt / EBITDA was c.1.2x as at 31 December 2017. For personal use only CY 2017 movements in net debt 100 50 Net -$67.2m of cash used for acquisitions Net Debt $m 0 63.7 (0.4) 3.4 (50) (43.9) (38.6) (72.0) (1) (100) Net +$28.1m of ca
Slide 20: Reconciliation of earnings to statutory financial statements
Reconciliation of earnings to statutory financial statements. For personal use only Reclasify: Reclass CY 2017 equity share Add back: Add back: net Add Back: GST corporate CY 2017 Add: proforma CY 2017 statutory of M&A costs fair value loss (1) adjustment (2) interest adjusted adjustment (3) proform
Slide 21: Important notice and disclaimer
Important notice and disclaimer For personal use only Disclaimer This presentation has been prepared by Smartgroup Corporation Ltd (ACN 126 266 831) (“Smartgroup”) and is general background information about Smartgroup’s activities current as at the date of this presentation. The information is give