Ofx Group Ltd. · ASX:OFX
Ofx — 1H24 Earnings Presentation
26 slides from Ofx's earnings presentation, Nov 14, 2023
Slide 1: 1H24 Financial Results
1H24 Financial Results 14 November 2023 OFX Group Limited ACN 165 602 273
Slide 2: Agenda
Agenda 1 Performance update 2 Financials 3 Strategy & FY24 Outlook 4 Q&A 5 Appendix 2
Slide 3: Performance update
Performance update Skander Malcolm Chief Executive Officer and Managing Director
Slide 4: Financial highlights 1H24
Financial highlights 1H24 Record NOI and EBITDA, executing through the cycle Turnover1 NOI2 Underlying EBITDA3 Key Takeaways down 3.5% up 9.4% up 1.6% ex Paytron Firma integration progressing well, $19.2bn $115.1m $31.8m Paytron acquisition closed North America Corporate revenue impacted by lower Co
Slide 5: Outlook positive, good revenue momentum in B2B
Outlook positive, good revenue momentum in B2B 1H24 momentum into 2H24 FY24 Outlook: 2H24 expected to be stronger than 1H24 ● Strong 1H24 NOI driven by pricing, treasury management and interest income, improving margins which are expected to continue, and a one NOI Core Underlying EBITDA off $3.7m e
Slide 6: Growth in B2B segment with Enterprise activating
Growth in B2B segment with Enterprise activating Offset by 12.2% decline in Corporate ATVs B2B revenue up Expanding margins1 Corporate ATVs, $k +6.8% +4 bps 35.7 36.9 36.1 32.4 28.3 Transactions growing +10.3% 72.6 70.7 66.1 1H22 2H22 1H23 2H23 1H24 43.5 36.9 65.5 63.4 59.1 ● Increased B2B portfolio
Slide 7: Corporate revenue up 7.2% with momentum building
Corporate revenue up 7.2% with momentum building Corporate business conditions vary by sub region Corporate pipeline strong and growing Revenue % 1H24 v 1H23 transactions through the cycle ● Continue to grow revenue with margins Corporate registrations, #k 7.9 +4.1% up 7 bps. Corporate registrations
Slide 8: New partnerships and activation driving excellent Enterprise momentum
New partnerships and activation driving excellent Enterprise momentum Sample clients Enterprise revenue up +46.0% Enterprise revenue, $m 4.2 ● Existing clients performing well, Link and WiseTech continuing to grow, revenue up by >200% 3.3 3.1 ● Two new partnerships signed in 1H24, including the firs
Slide 9: High Value Consumer rebound
High Value Consumer rebound Revenue up in all regions v 2H23 High value use cases1 rebounded Revenue, $m Revenue by use case 38.3 36.9 35.8 34.4 33.2 Purchase - Goods +5.8% & Services Wealth related +19.0% transfers APAC North America Property +9.2% EMEA Gift / Family support Mortgage / Loan Payment
Slide 10: Financials
Financials Selena Verth Chief Financial Officer
Slide 11: Solid results, healthy fundamentals
Solid results, healthy fundamentals Financial results 1H23 2H23 1H24 V 1H23 Financial metrics ($m) ● Fee and trading income up 3.3% with strong growth from EMEA and APAC, and continued healthy Fee and trading income (revenue) 110.9 114.1 114.6 3.3% conversion to NOI Net operating income 105.3 108.8
Slide 12: Careful expense management and intangibles in line
Careful expense management and intangibles in line Underlying operating 1H23 2H23 1H24 V 1H23 V 2H23 expenses ($m) ● Group wide productivity programs delivering Employee expenses 49.6 55.4 58.4 17.7% 5.4% reduced employee expense growth in 1H24, up Promotional expenses 9.1 7.7 9.7 7.0% 25.5% 5.4% on
Slide 13: Continued margin expansion
Continued margin expansion NOI Margin NOI Margin walk 0.70% 0.70 0.68% 0.60% 0.01% (0.01%) 0.57% 0.03% 0.65 0.60% 0.60 0.57% 0.55 0.50 0.45 0.40 0.35 0.30 1H22 2H22 1H23 2H23 1H24 2H23 Pricing Interest Income North America1 1H24 NOI margin NOI margin (ex same currency) 1 NOI includes $3.7m escrow am
Slide 14: Healthy cash generation & a strong balance sheet
Healthy cash generation & a strong balance sheet Balance Sheet ($m) 30 Sep 22 31 Mar 23 30 Sep 23 Cash held for own use 67.2 68.2 67.6 Cash held for settlement of client liabilities 356.0 368.7 279.4 ● Net cash held $92.8m, net available cash $60.8m Deposits due from financial institutions 25.7 25.6
Slide 15: Strategy & FY24 Outlook
Strategy & FY24 Outlook Skander Malcolm Chief Executive Officer and Managing Director
Slide 16: Building the world's leading cross-border payments specialist
Building the world’s leading cross-border payments specialist Huge opportunity Target segments Competitive positioning More valuable company Distinctive CVP Healthy revenue growth US$206bn1 cross-border payments market which keeps growing Corporate ++ + High recurring revenue Digital Human 72% marke
Slide 17: OFX is focused on growth
OFX is focused on growth … which looks more … which will drive Our B2B focus is clearer … attractive every quarter … growth and returns Focusing on B2B go-to-market Future OFX revenue excellence composition % total 18% improvement in prospect to revenue client conversion rates v 2H23, which Card and
Slide 18: FY24 Outlook
FY24 Outlook 2H24 Assumptions ● Canadian Corporate ATVs continue to increase as Corporate confidence returns NOI Core Underlying EBITDA ● Canadian Corporate margins return to historic levels $225m - $238m $63m - $70m ● Momentum in B2B segment with strong growth in From $225 – $243m From $63m - $74m
Slide 19: Q&A
Q&A 19
Slide 20: Appendix
Appendix
Slide 21: Healthy NOI and EBITDA performance
Healthy NOI and EBITDA performance Turnover ($bn)1 Net Operating Income ($m)2 Underlying EBITDA ($m)2 115.1 105.3 108.8 32.2 31.8 30.1 78.4 24.2 19.9 19.2 19.2 18.2 68.6 20.3 15.0 1H22 2H22 1H23 2H23 1H24 1H22 2H22 1H23 2H23 1H24 1H22 2H22 1H23 2H23 1H24 1H24 down (3.5)% v 1H23 1H24 up 9.4% v 1H23 1
Slide 22: Revenue varies by region and segment
Revenue varies by region and segment Revenue $m APAC North America EMEA 44.6 45.0 44.9 46.2 44.9 43.8 43.4 39.1 17.2 16.9 14.6 13.4 22.4 11.5 20.7 1H22 2H22 1H23 2H23 1H24 1H22 2H22 1H23 2H23 1H24 1H22 2H22 1H23 2H23 1H24 Consumer Corporate OLS Enterprise Consumer Corporate OLS Enterprise Consumer C
Slide 23: Loyal clients increasing transaction activity
Loyal clients increasing transaction activity Active clients Transactions per Transactions ATV Turnover 145.0k active client 703.3k $27.3k $19.2bn OFX Group1 9.4 4.1% up on 1H23 7.3% down on 1H23 3.5% down on 1H23 5.0% down from 1H23 13.2% up from 1H23 Active clients Transactions per Transactions AT
Slide 24: Attractive Recurring Revenue
Attractive Recurring Revenue Revenue from Existing Clients 84% increase from 82% in 1H23 87% 79% 87% Corporate revenue $m High Value Consumer revenue $m Online Seller revenue $m 70 40 5 60 35 30 4 50 25 40 3 20 30 15 2 20 10 1 10 5 0 0 0 1H17 2H17 1H18 2H18 1H19 2H19 1H20 2H20 1H21 2H21 1H22 2H22 1H
Slide 25: Definitions
Definitions • Active Client: Number of clients that entered into a Transaction with OFX during the immediately preceding 12-month period • ATV: Average transaction value • B2B: Corporate, Online Sellers (OLS) and Enterprise segments • Corporate: As of 1H21, Corporate excludes OLS; OLS is reported se
Slide 26: Thank you
Thank you | OFX.COM The material contained in this document is a presentation of general information about OFX Group Limited (Company) and its activities current as at 14 November 2023. Material is provided in summary only and does not purport to be complete. The material contained in this document