Ofx Group Ltd. · ASX:OFX
Ofx — Investor Day (March 2019)
41 slides from Ofx's investor day presentation, Mar 20, 2019
Slide 1: Investor Day - March 2019
For personal use only Investor Day - March 2019 Investor presentation 20 March 2019
Slide 2: Agenda
Agenda For personal use only This is OFX 2H update & how we create value Break Competitive landscape Regulatory update Marketing strategy OFX around the world Break Our client experience & technology demonstration 2
Slide 3: This is OFX
For personal use only This is OFX Skander Malcolm Chief Executive Officer and Managing Director 3
Slide 4: OFX at a glance
OFX at a glance Who we are Operating under our global infrastructure For personal use only • ASX listed • • Founded in 1998 380+ employees over 7 16 55 24/7 1 Global banking Localised client Technology locations Licenses relationships service platform • Servicing Consumers ~50%, Corporates ~45% and
Slide 5: Our strategic growth pillars remain the same
Our strategic growth pillars remain the same For personal use only Strategic growth pillars Growth Drivers Our mission To become the trusted international money services provider by consumers and businesses, who value a seamless digital experience at a competitive price; with Client Geographic Partn
Slide 6: 2H update & how we create value
For personal use only 2H update & how we create value Skander Malcolm Chief Executive Officer and Managing Director Selena Verth Chief Financial Officer 6
Slide 7: Continued decline in market volatility
Continued decline in market volatility For personal use only Volatility in 2H19 YTD vs 2H18 YTD (AUD/USD)* 0.300% Quarter 3 Quarter 4 0.200% 15bps 2H Daily volatility outside bands 1H 0.100% YTD Volatility +/- 15 bps Days 0.000% FY17 43 40 FY18 21 36 -0.100% (15bps) FY19 30 25 -0.200% -0.300% 2H18 2
Slide 8: FX spot market is softer globally in 2H19
FX spot market is softer globally in 2H19 For personal use only 2H19 YTD total market spot volume is down 1H19 - OFX consistently outperforms market volumes (7)% vs 2H18 Indexed* OFX 1H19 revenue vs Thompson Reuters FX volumes ($bn) Thompson Reuters average daily FX volumes ($bn) 114 Month Market OF
Slide 9: Trading update
Trading update FY19 YTD Opportunities for FY20 For personal use only Invest in Corporate client experience • Corporate growth growing at 10%+ across all markets Build Enterprise client experience Client Experience • US 2H19 HTD revenue up 20%+ • Stable NOI margins ex-IPS • Active client growth in Fe
Slide 10: Strong financial foundations driving sustainable growth
Strong financial foundations driving sustainable growth For personal use only Financial foundations 72% $14.8m - FY18 recurring revenue Debt free strong cashflow Dedicated treasury 1H19 balance sheet generation management Driving a sustainable growth company 25% - FY18 Positive 4 EBITDA margin conse
Slide 11: Expanding our lifetime revenue
Expanding our lifetime revenue Consumer ROI For personal use only Growing the lifetime revenue of our clients* • ATV of $16,700 in FY18 • Average 6 transactions over 3 years IPS Corporate • ATV of $24,900 in FY18 Corporate • Average 40 transactions over 3 years • 8x higher lifetime revenue of a Cons
Slide 12: Competitive landscape
For personal use only Competitive landscape Skander Malcolm Chief Executive Officer and Managing Director 12
Slide 13: Huge market, fragmented with specific use cases
Huge market, fragmented with specific use cases Substantial opportunity for growth For personal use only $127 trillion market mostly in B2B 6%* 3.5% 1.5% 0.1% Source: McKinsey GCI Cross border model and McKinsey “A vision for the future of cross-border payments” * % represent average margins charged
Slide 14: OFX well positioned as consolidation underway
OFX well positioned as consolidation underway For personal use only Key themes emerging in global payments are Relevant completed / announced transactions supportive of OFX’s strategy Hyperwallet API integration / platform enablement WorldFirst Airwallex Enhanced corporate offering iZettle Earthport
Slide 15: Key trends in the competitive landscape
Key trends in the competitive landscape For personal use only PE funding up $163m in corporate focused vs. reduction of $274m in consumer remittance and blockchain between The investment in Corporate is growing 2017 and 2018. Historically consumer-focused players increased their product release and
Slide 16: Sustainable leader in cross border payments
Sustainable leader in cross border payments For personal use only Profitable growth Consumer led growth Consumer cross-sell 212 119 Revenue EBITDA 30 24 23 (27) OFX Pure Digital Neobank 25.2% 11.3% (117.3%) EBITDA margin EBITDA margin EBITDA margin OFX Pure digital Neobank Competitor 1 Competitor 2
Slide 17: Regulatory update
For personal use only Regulatory update Mark Shaw Chief Operating Officer 17
Slide 18: Risk & compliance landscape
Risk & compliance landscape For personal use only New business Money laundering models regulation Large scale money laundering Differing approaches taken by cases continue to be identified new entrants to existing laws Client experience Board oversight impacts Royal commission spotlight on Account f
Slide 19: OFX's approach to risk management
OFX’s approach to risk management For personal use only Empower OFX to grow whilst being the guardian of trust with every stakeholder Local leaders, globally respected Regular testing Data driven insight • Senior compliance leadership on the Over the last 12 months: • Investment in next-generation t
Slide 20: Marketing strategy
For personal use only Marketing strategy Rebecca Shears Chief Marketing Officer 20
Slide 21: Our marketing mission
Our marketing mission For personal use only New revenue Client engagement Brand distinctiveness • Targeted acquisition via search • CRM has delivered in and Google display network • New brand platform – Where the Consumer, increasing • Smart Display drove Worlds Moving – is increasing transactions a
Slide 22: CRM adds value – tactical campaigns combined with automation
CRM adds value – tactical campaigns combined with automation For personal use only AU re-activation offer USD 2-week high ECB interest rates Tactical campaigns AUD 4-week high and automation driving up consumer EU Summit back book revenue AUD trade truce USD slips Corporate automation has launched t
Slide 23: Corporate client insights
Corporate client insights For personal use only Stage 1 Stage 2 Stage 3 Stage 4 Desk Research Qualitative Research CVP Development GTM Strategy Quantitative research Findings from prospects: • Active and tapped into the FX category • Primary or secondary research specific to each geography • Aware o
Slide 24: Go to market plan
Go to market plan For personal use only Account OFX - provider of choice for Corporate clients: Management • Build value propositions in Corporate to chosen client Corporate Financial segments, and communicate our differentiators Client Teams Insights • Develop and communicate our risk management to
Slide 25: For personal use only
For personal use only https://www.youtube.com/watch?v=pdpDvPjDYzQ&feature=youtu.be 25 25
Slide 26: OFX around the world
For personal use only OFX around the world Skander Malcolm Chief Executive Officer and Managing Director Mike Kennedy President North America Sarah Webb President UK/Europe
Slide 27: OFX around the world, a strong global platform
OFX around the world, a strong global platform For personal use only Europe 1H19 revenue $11.3m, up 13% North America 1H19 revenue Asia 1H19 revenue $3.6m, up 29% $12.7m, up 18% A&NZ 1H19 revenue $33.4m, up 13% 27
Slide 28: North America focus areas result in strong growth
North America focus areas result in strong growth For personal use only Value proposition / differentiation • Trusted international payments provider with streamlined digital experience and expert personal service focused on high dollar transactions for consumers and small to medium sized businesses
Slide 29: OFX around the world, a strong global platform
OFX around the world, a strong global platform For personal use only Europe 1H19 revenue $11.3m, up 13% North America 1H19 revenue Asia 1H19 revenue $3.6m, up 29% $12.7m, up 18% A&NZ 1H19 revenue $33.4m, up 13% 29
Slide 30: Our client experience
For personal use only Our client experience Skander Malcolm Chief Executive Officer and Managing Director 30
Slide 31: Client experience matters: examples of competitor experience
Client experience matters: examples of competitor experience For personal use only Heads-up 📢 Shareholders have taken the decision to On 15th Jan, we’re limiting transfers to and discontinue with the US operations. As such, from the UK to £10,000. The exchange rate we will no longer be able to…
Slide 32: Our Clients
Our Clients For personal use only • 10 years with OFX • Almost 2 years with OFX • Payment and trade finance provider • Engineering start-up, specialising in a robotic flight forming machine • Michael Rom – Chief Operating and Chief Technology Officer • Hayel Smair – Founder & Chief Executive Officer
Slide 33: Technology and client experience
For personal use only Technology and client experience Vipin Vijayan Product Owner App, OFX 33
Slide 34: We have completely transformed the app in the last months
We have completely transformed the app in the last 12 months For personal use only Apr-18 Sep-18 Dec-18 Frequent incremental Original app Beta launch New app launch North America updates payments 34
Slide 35: The new app is easy-to-use and quick
The new app is easy-to-use and quick For personal use only 25 fields before 7 fields now 35
Slide 36: We have seen a big improvement in key business metrics
We have seen a big improvement in key business metrics For personal use only >2x Registration completion rate +49% Transfers made in the app in the US 36
Slide 37: Global executive team
Global executive team Skander Malcolm For personal use only Chief Executive Officer and Managing Director Skander Malcolm joined OFX in February 2017 as CEO and has more than 23 years’ experience in financial services including payments technology platforms in both established and emerging markets.
Slide 38: Global executive team
Global executive team For personal use only Yung Ngo President, Asia Pacific Yung joined OFX in March 2019 as President, Asia Pacific. Yung has over 20 years financial services experience having held senior management positions at Westpac, St George Bank and GE Capital leading large scale operations
Slide 39: Global executive team
Global executive team For personal use only Wendy Glasgow Chief Technology Officer Wendy joined OFX in February 2018. Wendy has over 15 years experience in the technology industry, leading teams to deliver business critical online products to Australian and international markets. Most recently, Wend
Slide 40: Global executive team
Global executive team For personal use only Freya Smith Chief Legal Officer Freya Smith joined OFX in September 2015 and is the Chief Legal Officer and Company Secretary for OFX Group. Freya holds a Bachelor of Commerce and a Bachelor of Laws (Hons); a Master of Laws (High Distinction); and a Gradua
Slide 41: For personal use only
The material contained in this document is a presentation of general information about OFX Group Limited (Company) and its activities current as at 20 March 2019. Material is provided in summary only For personal use only and does not purport to be complete. The material contained in this document h