Dsw Capital Plc · LSE:DSW
Dsw Capital — H1 2025 Earnings Presentation
28 slides from Dsw Capital's earnings presentation, November 2024
Slide 1: DSW Capital plc Half Year Results H1 FY25
DSW Capital plc Half Year Results H1 FY25 November 2024
Slide 2: Disclaimer
Disclaimer Insert logo here The following presentation, including a hard copy of these slides/the talks given by the presenters, the information communicated during any delivery of the presentation and any question and answer session and any document or material distributed at or in connection with
Slide 3: Today's Presenters
Today’s Presenters Executive Directors James Dow Shru Morris Pete Fendall Chief Executive Officer Chief Executive Officer Designate Chief Finance & Operating Officer James established Dow Schofield Watts LLP in She joined Dow Schofield Watts in 2024, Pete joined DSW Capital in September 2021 to 2002
Slide 4: Overview of DSW
Overview of DSW Insert logo here Joined AIM Dec 21 • Challenger “Big 4” mid market professional services network. • 112 licenced fee earners (“FE”) predominantly trading under the DSW brand with 12 locations across the UK. • Licence fee is charged typically on a percentage of revenue. • Provide the
Slide 5: The DSW Licence Model
The DSW Licence Model Insert logo here Empowering ambitious professionals to build their own business We recruit highly skilled professionals (typically “Big 4”) in focussed niches of expertise to run their own business and provide services to small to mid market corporates and their owner managers.
Slide 6: The DSW Licence Model
The DSW Licence Model Insert logo here Strengths to DSW Capital Strengths to the Licensee Strong perceptions of credentials and Recurring licence fees capability. Minimal exposure to property and employee Cross referrals and access to multidisciplinary costs. services. Easier recruitment, central ma
Slide 7: Current Service Lines
Current Service Lines Insert logo here Corporate Business Financial Business Finance Recovery Due Diligence Planning Tax Advisory Advisory FE=40 FE=24 FE=17 FE=7 FE=6 Venture Capital Debt Advisory ABL Risk Fractional Funding Equity Finance Management Support FE=6 FE=4 FE=4 FE=2 FE = 2 Dow Schofield
Slide 8: H1 FY25 Performance Highlights
H1 FY25 Performance Highlights Insert logo here • Network Revenue of £7.8m (H1 FY24: £7.3m) Network Revenue (£m) • Results typically weighted to H2 18.3 18.3 16.0 H1 H2 15.3 • Income from licensees* was in line with prior year at 8.5 £1.1m (H1 FY24: £1.1m) 11.0 8.7 10.4 • Underlying EBITDA+ decrease
Slide 9: H1 FY25 Income Statement
H1 FY25 Income Statement Insert logo here £000s Sept-24 Sept-23 Portfolio Income 7,782 7,309 Key Highlights Licence Income 1,081 1,108 • Total income in line with prior year, with activity Profit Share Income* 16 20 levels picking up in Sep-24 Total Income 1,097 1,128 • Profit share income marginall
Slide 10: H1 FY25 Balance Sheet
H1 FY25 Balance Sheet Insert logo here £000s Sept-24 Mar-24 £000s Sept-24 Mar-24 Non-current assets Net current assets 4,321 4,278 Intangible assets 677 696 Non-current liabilities Property, plant and equipment 319 363 Lease liability 140 218 Lease receivable 57 82 Dilapidation provision 83 80 Inves
Slide 11: Cash Flow Statement
Cash Flow Statement Insert logo here £000s Sept-24 Sept-23 £000s Sept-24 Sept-23 Cash flows from operating activities Operating cash conversion* (%) (123%) (146%) Profit for the year 66 (103) Operating cash conversion before 17% (21)% Adjustments for tax, interest, non-cash items 76 292 loans to new
Slide 12: Network KPIs
Network KPIs Insert logo here Fee Earners 112 LTM Portfolio Revenue vs. Fee Earners 25 120 7.7% YOY growth 100 20 Number of Fee Earners LTM Portfolio Revenue 80 Network 15 Revenue £7.8M 60 10 6.8% increase on PY 40 5 20 - 0 14.1% 1:1.3 Partner to Employee H1 FY23 FY23 H1 FY24 FY24 H1 FY25 Average Li
Slide 13: Recruitment
Recruitment Insert logo here • Closed H1 FY25 with 112 Fee Earners – FY23 H1 FY24 FY24 H1 FY25 7.7% growth YoY Partners 42 48 50 49 Employees 55 56 57 63 • Partner recruitment has tightened, Total Fee Earners 97 104 107 112 reflecting upturn in M&A activity Partner to 1:1.3 1:1.2 1:1.1 1:1.3 Employe
Slide 14: Opportunities for growth
Opportunities for growth Insert logo here Acquisition of “Break-outs” licence fees Organic Service line growth extension Geographical expansion Dow Schofield Watts 14
Slide 15: Target Acquisition Service Lines
Target Acquisition Service Lines Insert logo here High margin, high growth, niche professional services where there is a strong synergistic fit. Existing service lines in new locations. Tax-related services and family office. Other Big 4 (non-audit) service lines. Niche legal services. Dow Schofield
Slide 16: Acquisition of DR Solicitors Limited ('DR')
Acquisition of DR Solicitors Limited (‘DR’)
Slide 17: Overview of DR Solicitors
Overview of Insert logo here • Award winning Law firm specialising in the Healthcare sector • “One stop shop” legal services for Primary care (GP’s, Primary Care Networks) • 18 consultant fee earners (“FE”) delivering work for DR Key Financials FY24 Solicitors, who keep a percentage of the revenue.
Slide 18: Transformational acquisition
Transformational acquisition Insert logo here • On 1 Nov 2024, DSW acquired DR Solicitors for Strategic fit: £6.1m satisfied by £1.8m of consideration shares and £4.3m of cash Reduces Significantly Step change M&A • Funded by a Revolving Credit Facility of £3m earnings in growth dependency enhancing
Slide 19: Management Changes
Management Changes Insert logo here The board announces the following management changes as part of the Group’s succession planning Pete Fendall is appointed Chief Finance and Operating Officer1 Shru Morris is appointed Chief Executive Officer Designate1 Shru Morris will succeed James Dow as Chief E
Slide 20: Summary and Outlook
Summary and Outlook Insert logo here Summary • H1 FY25 in line with management expectations • Network Revenue of £7.8m (+6.8%) – M&A gradually improved with strong momentum in September 2024. • 112 Fee earners -36.6% increase in FEs since the admission to AIM in December 2021. • Recruitment has tigh
Slide 21: Questions
Questions 20
Slide 22: Appendices
Appendices 21
Slide 23: Investment Case
Investment Case Insert logo here Capital light Scalable and innovative platform model Large market ripe for disruption Recurring revenue base Continued strong growth in Fee Earners The AIM listing is important. It has: • increased our profile to partner candidates; • provided capital for the acquisi
Slide 24: Summary Investment Thesis
Summary Investment Thesis Insert logo here Why invest? Robust, recurring income stream. Predictable cost base with low operational gearing. Capital light. Scalable platform model. Significant opportunity for organic and acquisition driven growth. Cash backed profits which have supported 9.98 pence p
Slide 25: The accountancy profession is ready for something new
The accountancy profession is ready for something new….. The “Big 4” are under significant pressure to restructure DSW Differentiators: Partners also continue to benefit from: International Being part of A direct link 100% Central network - Greater a multi- Pandea between fees operational infrastruc
Slide 26: Timeline of the Business
Timeline of the Business Insert logo here DSW Network has grown steadily to a team of 107 FE working in 11 service lines (31 March 2024) July 2023- DSW Bridgewood May 2012 – launched Aug 2021 – Launch joins the network DSW Forensics based of Debt Advisory DSW CF Advisory in the North West London Dec
Slide 27: Our ESG journey
Our ESG journey Insert logo here In FY24, we established our ESG Committee made up of representatives from across the organisation, to drive forward our ESG initiatives across all four cornerstones. Social & Environmental Impact Diversity & Inclusion • Reduced our Scope 1 Emissions by 53.4% • Intern
Slide 28: Contact Us
Contact Us Burscough Cardiff Cheadle Daresbury Guildford Leeds 702 Merlin Business Park The Maltings The Camlee Group 7400 Daresbury Park Weybourne House Cubo, 3rd Floor Ringtail Rd E Tyndall St Eden Point Daresbury Hitherbury Close 6 Wellington Place Burscough Cardiff Three Acres Ln Warrington Guil