Shine Justice Ltd. · ASX:SHJ
Shine Justice — Shine Corporate — FY2016 Earnings Presentation
24 slides from Shine Justice's earnings presentation, Aug 24, 2016
Slide 1: FY16 Results
SHINE CORPORATE LTD FY16 RESULTS COURTNEY PETERSEN DANIEL WILKIE SIMON MORRISON MANAGING DIRECTOR & CEO CHIEF FINANCIAL OFFICER EXECUTIVE DIRECTOR INVESTOR PRESENTATION 2016 ABN 93 162 8176 905 | 24 AUGUST 2016
Slide 2: Disclaimer
DISCLAIMER This presentation contains certain forward-looking statements with respect to the financial condition, results of operations and business of Shine Corporate Ltd and certain plans and objectives of the management of Shine Corporate Ltd. Such forward-looking statements involve both known an
Slide 3: Shine a light on injustice and make the world a better place
SHINE A LIGHT ON INJUSTICE AND MAKE THE WORLD A BETTER PLACE ONE CLIENT AT A TIME 3
Slide 4: Operating Highlights
OPERATING HIGHLIGHTS CONTINUING THE JOURNEY OF TRANSFORMATION >> Achieved revised EBITDA and GOCF guidance for FY16 >> Disciplined execution – FY16 Ignite (transformation) program implemented >> Strengthened operating model: —— Work in progress adequately provisioned – focused on recoverability —— C
Slide 5: FY16 Headline Results
FY16 HEADLINE RESULTS FY16 REVISED FY16 RESULT GUIDANCE Statutory EBITDA $25.0m $24m-$28m ✓ Gross Operating Cash Flow $18.8m 40% of EBITDA ✓ Record year for fees billed ✓ Record year for Gross Operating Cash Flow ✓ Net Debt to Equity reduced from 19.0% (31 Dec 15) to 10.9% ✓ Final dividend 2.5 cents
Slide 6: Transformation Program
TRANSFORMATION PROGRAM DELIVERED ON FY16 OBJECTIVES STRENGTHEN PROTECT CHAMPION INNOVATE GROW SHINE SHINE THE CLIENT SHINE SHINE >> Record fees billed >> Strengthened >> DePuy class >> Established >> Successful >> Improvement in governance and action settlement Insolvency and new marketing file velo
Slide 7: Engine Room Update
ENGINE ROOM 1 UPDATE Significant progress on new Enterprise Legal Management System and Business Process Optimisation >> Engaged Thomson Reuters Elite to implement globally recognised Enterprise Legal Management Solution >> Leverages global best in class solution, minimises need for customisation >>
Slide 8: FY16 Financial Results
FY16 FINANCIAL RESULTS DANIEL WILKIE CHIEF FINANCIAL OFFICER 8
Slide 9: Results at a Glance
RESULTS AT A GLANCE AS AT FY16 H1 FY16 H2 FY2016 FY2015 Revenue1 ($m) 64.0 87.5 151.5 150.9 Statutory EBITDA ($m) 2.1 22.9 25.0 44.0 Normalised EBITDA2 ($m) 2.5 23.1 25.6 45.4 Statutory NPAT ($m) 1.3 13.5 14.8 29.6 Normalised NPAT3 ($m) 1.6 13.7 15.3 30.6 Gross operating cash flow ($m) 3.6 15.2 18.8
Slide 10: EBITDA Bridge
EBITDA BRIDGE $m 60 1.1 > > Growth in revenue for 1.4 50 4.3 Personal Injury and 6.5 Emerging Practice 40 Areas was offset by 14.4 the recognition of 30 2.1 provisions against the 4.9 recoverability of WIP 20 4.0 4.5 > Strong > contributions to 44.0 revenue and earnings from new subsidiaries 10 25.0
Slide 11: Cash Flow (Shine Lawyers)
CASH FLOW (SHINE LAWYERS) SHINE LAWYERS: > > Work in Progress is realised in % FEES BILLED IN FY16 BY YEAR IN operating cashflow over a number $M 120 WHICH WIP PERFORMED of years (see chart). The level of 120 1200 operating cash flow is dependent on 100 the overall value of fees billed and 100 1000
Slide 12: Gross Operating Cash Flow (GOCF)
GROSS OPERATING CASH FLOW (GOCF) GOCF > > GOCF increased from $13m to $18.8m $m > > The increase in GOCF was driven by: % 20 120 —— strong billings in May and June 2016 18 —— internal focus on improving timeframes for 100 18.8 16 cash collection 14 30 —— net disbursement funding grew by $5.8m 12 ——
Slide 13: Provisioning Update
PROVISIONING UPDATE FOCUSED ON EXECUTION >> Adjustment to WIP and disbursements provisioning methodology and debtors: —— One-off $17.5m adjustment in H1 FY16 >> Strengthened provisioning methodology: —— Provisions against WIP are made monthly based on historical recoverability rates —— WIP and assoc
Slide 14: Revenue Diversification
REVENUE DIVERSIFICATION INCREASING REVENUE FROM INCREASING REVENUE EMERGING PRACTICE AREAS OUTSIDE QLD PI % % % G [ [ 100 100 100 E R 100 IN G V EN UE EM 100 100 1 6 : E AS 2% R E 2 0 A R : 6 80 A C T ICE 80EASE D 80 20 80 E Q80LD PI 1 6 PR ID R OUTS ICE AREA 80 A V E INC 60 H % 60 60 PRA60 CT 60 TO
Slide 15: Growth: Subsidiaries' Expansion
GROWTH SUBSIDIARIES’ EXPANSION >> Improved H2 performance from Subsidiaries – H2 EBITDA up vs H1 >> Subsidiaries’ EBITDA FY15 vs FY16 increase by $3.3m (29%) >> Strong cash flow generation SUBSIDIARY OPERATIONAL PERFORMANCE Sciaccas —— H1 performance impacted by Qld Work Cover reforms, stronger file
Slide 16: Balance Sheet
BALANCE SHEET AS AT ($M) 30 JUN 16 30 JUN 15 STRONG BALANCE SHEET: >>Cash on hand at 30 June increased Cash and receivables 33.4 29.9 by $2.7m to $12.1m Work in progress 203.0 190.7 >>Net WIP grew by 6.45% or Unbilled disbursements 52.9 48.6 $12.3m to $203m primarily from organic growth PP&E and int
Slide 17: Net Debt and Banking Facilities
NET DEBT AND BANKING FACILITIES MEASURE $M NET DEBT >>Net debt at 31 December 2015 was Net debt at 30 June 2015 12.3 $32.2 million (19%) Acquisitions 9.6 >>Acquisition payments in FY16 included FY15 contingent and deferred 6.3 Bradley Bayly $6.2m and Best Wilson Buckley Family Law $3.4m consideratio
Slide 18: FY17 Outlook
FY17 OUTLOOK COURTNEY PETERSEN MANAGING DIRECTOR 18
Slide 19: Transformation Program FY17 Key Initiatives
TRANSFORMATION PROGRAM FY17 KEY INITIATIVES STRENGTHEN PROTECT CHAMPION INNOVATE GROW SHINE SHINE THE CLIENT SHINE SHINE >> Refined operating >> Improved vendor and >> Client onboarding >> Implement Enterprise >> Stronger focus on model contract management and case selection and Legal Management gro
Slide 20: Expectations for Operating Outlook
EXPECTATIONS FOR OPERATING OUTLOOK >> Personal Injury market continues to be challenging >> Strong pipeline from Emerging Practice Areas (in particular class actions) >> Continue to seek profitable opportunities for growth organically or by acquisition in Personal Injury or Emerging Practice Areas >
Slide 21: Appendices
APPENDICES 21
Slide 22: Corporate Management Structure
CORPORATE MANAGEMENT STRUCTURE MANAGING DIRECTOR COURTNEY PETERSEN CHIEF LEGAL CHIEF OPERATING CHIEF FINANCIAL HEAD OF PEOPLE HEAD OF INTEGRATION & OFFICER OFFICER OFFICER & CULTURE ENTERPRISE SERVICES Jim Holding1 Geniere Aplin Daniel Wilkie Melissa Leahy Christopher Hughes 1 Jim Holding will comme
Slide 23: Office Locations
OFFICE CAIRNS VILLE TOWNS Y BA LOCATIONS RE EY DO E RV ON HY HE DST OC RO GLA MA ERG H L RE AB ES TU IE ND AK MP OL KAY BU BO GY MAC RT E CA IN NO MS HP ER TRAT E ID S ER CH O RN E SC ON ALE ST RI ND CA NE SBA BRI ICH IPSW OOD SP GW N R IN LOGA E HELENSVAL BUNDALL ROBINA PERTH SAWTELL ALBANY NEWCAST
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