Mcmillan Shakespeare Limited · ASX:MMS
Mcmillan Shakespeare — Macquarie 12th Annual Australia Conference (May 2011)
23 slides from Mcmillan Shakespeare's conference presentation, May 4, 2011
Slide 1: MMS Group - Macquarie 12th Annual Australia Conference Presentation
MMS Group For personal use only Macquarie 12th Annual Australia Conference Presentation May 2011
Slide 2: Macquarie 12th Annual Australia Conference Presentation
Page 2 Macquarie 12th Annual Australia Conference Presentation For personal use only Macquarie 12th Annual Australia Conference Presentation A new, different and more capable organisation is emerging from the combination of the Group Remuneration Services business with the Asset Management business.
Slide 3: Company Overview
Page 3 Macquarie 12th Annual Australia Conference Presentation For personal use only Company Overview MMS is a unique provider of workplace benefits and vehicle solutions in Australia. Fleet management business of Interleasing Australia acquired in April 2010. The combined business provides salary p
Slide 4: Revenue Model
Page 4 Macquarie 12th Annual Australia Conference Presentation For personal use only Revenue Model Salary packaging administration fees: - annuity income stream; paid directly and regularly from employees’ salary. Interest income. Facilitation and procurement fees for assisting with novated lease se
Slide 5: Financial highlights 1HFY11
Page 5 Macquarie 12th Annual Australia Conference Presentation For personal use only Financial highlights 1HFY11 Consolidated NPAT of $20.5m. NPAT and EPS growth of 83% on PCP. Group Remuneration Services NPAT of $15.0m or 35% growth. Asset Management NPAT of $6.6m. Interim dividend of 16 cents per
Slide 6: Financial History
Page 6 Macquarie 12th Annual Australia Conference Presentation For personal use only Financial History FY05 FY06 FY07 FY08 FY09 FY10 $’000 $’000 $’000 $’000 $’000 $’000 Total revenue 35,838 48,721 54,536 66,624 77,259 131,021 Normalised pre tax profit from continuing operations 7,915 15,013 19,079 2
Slide 7: What is salary packaging?
Page 7 Macquarie 12th Annual Australia Conference Presentation For personal use only What is salary packaging? Australia’s taxation system allows tax concessions for certain employee benefits and for certain industry sectors which makes salary packaging attractive. Eligible employees increase their
Slide 8: Tax benefits from salary packaging
Page 8 Macquarie 12th Annual Australia Conference Presentation For personal use only Tax benefits from salary packaging Yearly benefit schedule Yearly benefit schedule PBI $16,050 Health $9,095 Benefit Benefit 7,000 4,500 6,000 4,000 3,500 5,000 3,000 4,000 $ 2,500 $ 3,000 2,000 1,500 2,000 1,000 1,
Slide 9: What is a novated lease?
Page 9 Macquarie 12th Annual Australia Conference Presentation For personal use only What is a novated lease? Enables employees to finance and operate a personal vehicle using their pre-tax income. A three way agreement between financier, employee and employer. Employee enters into a lease directly
Slide 10: Why is the novated lease market growing?
Page 10 Macquarie 12th Annual Australia Conference Presentation For personal use only Why is the novated lease market growing? Relatively young <20 year old. In the majority of cases a novated lease provides a more cost effective outcome than using post tax income. Allows vehicle to be purchased wit
Slide 11: Tax benefits from novated leasing
Page 11 Macquarie 12th Annual Australia Conference Presentation For personal use only Tax benefits from novated leasing Yearly benefit: Benefit Novated Lease Assumptions 7,000 MV cost $34k Running costs $14k 6,000 7% (>40km) ITCs refunded to ‘ee 5,000 ECM method 11% (25-40k km) No business use 4,000
Slide 12: Asset Management
Page 12 Macquarie 12th Annual Australia Conference Presentation For personal use only Asset Management Financing and management services associated with motor vehicles, commercial vehicles and equipment. A financier can provide funding but this ignores the management of the asset during its life. Fl
Slide 13: The Asset Life Cycle
Page 13 Macquarie 12th Annual Australia Conference Presentation For personal use only The Asset Life Cycle In-Life Procurement Finance Disposal Services Purchase the Owned, Operating Fuel, insurance, Sale of the asset – vehicle / asset lease, finance maintenance, tyres, auction, dealers, – preferred
Slide 14: Income Streams
Page 14 Macquarie 12th Annual Australia Conference Presentation For personal use only Income Streams Income Streams Income streams – more than interest margin! Management fees & Disposal Finance Finance – brokerage / interest 34% 33% margin. Management fees and disposal income. Procurement & In-Life
Slide 15: Managing Residual Value Risk
Page 15 Macquarie 12th Annual Australia Conference Presentation For personal use only Managing Residual Value Risk Residual Values are set for term and kilometres by a Residual Value Committee. Proactive contract re-writes are undertaken to mark-to-market residual values where vehicle usage varies t
Slide 16: Strengths, Service Record and Sensitivities
Page 16 Macquarie 12th Annual Australia Conference Presentation For personal use only Strengths, Service Record and Sensitivities
Slide 17: What are MMS' comparative/competitive strengths?
Page 17 Macquarie 12th Annual Australia Conference Presentation For personal use only What are MMS’ comparative/competitive strengths? A unique market position: the only integrated provider of salary packaging and “one vehicle provider” solutions for both employers and employees. Industry leading se
Slide 18: Our unique market position
Page 18 Macquarie 12th Annual Australia Conference Presentation For personal use only Our unique market position Core Skills Core Skills Operating Lessors/ Fleet Proactive sales culture Managing vehicle value Salary Packagers Retail sales and marketing chain: procurement, Managers Budgeting/ BPO pro
Slide 19: Productivity and customer satisfaction indices
Page 19 Macquarie 12th Annual Australia Conference Presentation For personal use only Productivity and customer satisfaction indices Remuneration Services Productivity Index (7/08 = 100) MSL Customer Satisfaction Index [Rolling 3 month Revenue (ex SP Interest) / FTE] December 2008 = 100 140 250 135
Slide 20: Sensitivities
Page 20 Macquarie 12th Annual Australia Conference Presentation For personal use only Sensitivities Queensland economy post floods/cyclone – impact confined to January ($1 million pre-tax). New car sales. Second hand car values. Interest rates. Supply of motor vehicles post Japan’s natural disaster.
Slide 21: Growth opportunities
Page 21 Macquarie 12th Annual Australia Conference Presentation For personal use only Growth opportunities Salary Packaging Synergies Asset Management Increase salary packages Cross-sell salary Grow the loan book over through higher packaging and novated time with operating and penetration rate and
Slide 22: Business Update
Page 22 Macquarie 12th Annual Australia Conference Presentation For personal use only Business Update Key Queensland Government contract renewed from 1 April 2011 (3 years plus 2 year extension clause). No significant contract losses. ILA operating lease asset growth from $202m (30 June 2010) to $20
Slide 23: Outlook
Page 23 Macquarie 12th Annual Australia Conference Presentation For personal use only Outlook Continued, disciplined development of our core businesses. Industrial strength BPO. Ongoing growth through: - New business and cross-sell from our stronger post acquisition value proposition. - Increasing p
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