Propel Funeral Partners Ltd. · ASX:PFP
Propel Funeral Partners — Shareholder Meeting (November 2018)
38 slides from Propel Funeral Partners's shareholder meeting presentation, Nov 20, 2018
Slide 1: 2018 Annual General Meeting
ASX ANNOUNCEMENT 20 November 2018 2018 Annual General Meeting Attached are the addresses and accompanying presentation to be delivered by the Chairman and Managing Director at the 2018 Annual General Meeting of Propel Funeral Partners Limited (AGM) commencing today at 9.30am (Sydney time). Please no
Slide 2: Chairman's Address: Introduction and Board
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses PROPEL FUNERAL PARTNERS LIMITED Tuesday, 20 November 2018 Annual General Meeting Address from the Chairman, Brian Scullin: Good morning ladies and gentlemen. I’m Brian Scullin, Independent Chairman and Non-Executive Direc
Slide 3: Chairman's Address: Directors and FY18 Milestone
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses the responsible investing industry, having previously been on the board of ASX listed Australian Ethical Investments Limited, among other ‘for profit’ and ‘not for profit’ entities. Jonathan Trollip is an independent Non-
Slide 4: Clearly defined investment strategy in death care
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses Propel remains focussed on a clearly defined investment strategy to acquire assets which operate within the death care industry in Australia and New Zealand such as: • private funeral home operators; • funeral related pro
Slide 5: Address from the Managing Director
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses Address from the Managing Director, Albin Kurti: Thanks Brian. Good morning everyone and thanks for coming - it’s nice to see some familiar faces and some new faces too. I’d firstly like to thank all of the staff that wor
Slide 6: Acquisition agreement and business overview
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses • yesterday, Propel announced it had executed a conditional sale agreement to acquire up to 100% of the company that owns and operates the Manning Great Lakes Memorial Gardens near Taree in NSW, a high margin business whi
Slide 7: Earnings growth and acquisitions
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses Combined, these factors contributed to what we believe was an unusually seasonal financial year and a soft 2018 calendar year so far. However, death volumes fluctuate and have historically rebounded quickly, reverting bac
Slide 8: Fragmented funeral industry
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses Although consolidation activity has been occurring during our 13 year involvement in the industry, including our prior ownership of Bledisloe, the funeral industry remains highly fragmented in both Australia and New Zeala
Slide 9: Death volume trends
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses • firstly, in the last 27 years, a consecutive year on year decline has only occurred once, in 1990 & 1991; • secondly, year on year increases have occurred in 19 of the last 25 years, and in 10 of the last 12 years. So t
Slide 10: Outlook and balance sheet
Propel Funeral Partners Limited – Chairman’s and Managing Director’s Addresses In addition to solid Q1 trading, Propel expects to benefit from acquisitions completed during and since FY18 and other potential future acquisitions, although timing is obviously uncertain. And finally, Propel has a stron
Slide 11: 2018 Annual General Meeting
2018 ANNUAL GENERAL MEETING 20 November 2018
Slide 12: Items of business
Items of business 1. The Chairman’s introduction 2. Presentation from the Managing Director and Head of Investments 3. Formal business and resolutions 4. Shareholders’ questions 2
Slide 13: 1. The Chairman's introduction
1. The Chairman’s introduction
Slide 14: Your Board is focussed on delivering for shareholders
Your Board is focussed on delivering for shareholders Brian Scullin Fraser Henderson Independent Chairman and Non-Executive Director (NED) Executive Director – Head of M&A and • Chair of Tasmanian Development Board, Macquarie Point General Counsel/Company Secretary Development Corporation and NED of
Slide 15: Brian Scullin quote
BRIAN SCULLIN “Propel remains focussed on a clearly defined investment Independent Chairman & strategy to acquire assets which Non-Executive Director operate within the death care industry in Australia and New Zealand.” 5
Slide 16: 2. Presentation from the Managing Director
2. Presentation from the Managing Director
Slide 17: Albin Kurti quote
ALBIN KURTI “Propel exceeded the FY18 revenue and earnings forecasts Managing Director & contained in the Prospectus and Head of Investments the guidance issued in February 2018.” 7
Slide 18: Key highlights for FY18
Key highlights for FY18 1 Revenue: 76% to $80.9 million (FY17: $46.1 million) TRADING UPDATE Funeral volumes: 67% to 10,111 (FY17: 6,054) ARPF1: 5.5% to $5,508 (FY17: $5,223) 2 Operating EBITDA: 75% to $21.5 million (FY17: $12.3 million) EARNINGS2 Operating NPAT3: 125% to $12.3 million (FY17: $5.5 m
Slide 19: Prospectus forecasts achieved
Prospectus forecasts achieved Propel outperformed the key Prospectus forecasts for FY18 FY18 FY18 Pro forma Prospectus Achieved Comments actual Forecast Operating metrics Number of locations 103 80 ✓ Number of funerals 10,111 9,907 ✓ 1 Average Revenue Per Funeral $5,508 $5,330 ✓ Financial metrics Gr
Slide 20: Geographic presence
Geographic presence 108 locations (54 freehold / 54 leasehold), including 24 cremation facilities and 7 cemeteries June 2013 October 2018 Queensland Queensland 1 Western 14 Australia South Australia 10 28 New South Wales 3 1 ACT 17 Victoria 16 New Zealand Tasmania 19 FY12 FY13 FY14 FY15 FY16 FY17 FY
Slide 21: Brand portfolio
Brand portfolio Diversified single and multi-site brands with strong local community awareness QLD NSW/ACT VIC TAS SA WA NZ Pinegrove Funerals ismore Funeral Services Acquired since 1 July 2017 11
Slide 22: Volume and revenue growth
Volume and revenue growth Propel has maintained a strong growth trajectory Funeral volumes Revenue ($m) 10,111 80.9 2% 10% 9,907 Prospectus forecast 73.7 Prospectus forecast 6,054 46.1 2,967 22.4 1,625 10.9 906 6.0 465 278 1.2 2.2 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY12 FY13 FY14 FY15 FY16 FY17 FY18
Slide 23: Earnings growth
Earnings growth Propel has maintained a strong growth trajectory Operating EBITDA ($m) Operating NPAT1 ($m) 21.5 12.3 21.1 16% Guidance 19% 18.4 10.4 Prospectus Prospectus forecast forecast 12.3 5.5 5.8 2.9 3.1 1.5 FY15 FY16 FY17 FY18 FY15 FY16 FY17 FY18 . 1 Net profit after tax adjusted for the one
Slide 24: Average Revenue Per Funeral growth
Average Revenue Per Funeral1 growth 5 year compound annual growth rate (CAGR) of 3% $5,508 3% CAGR 3% $5,330 Prospectus $5,223 forecast $5,099 $4,976 $4,899 FY14 FY15 FY16 FY17 FY18 1Average Revenue Per Funeral excluding disbursements and delivered prepaid funeral impacts (ARPF) 14
Slide 25: Acquisition update
Acquisition update Propel is focussed on delivering its Investment Strategy 1 WA entry: Acquired Seasons Funerals DURING FY18 NSW/VIC expansion: Acquired Brindley Group ACT entry: Acquired Norwood Park (ACT/NSW/QLD) 2 QLD expansion: Acquired Newhaven Funerals NQ YTD Property acquisitions: Acquired 3
Slide 26: Increasing number of deaths
Increasing number of deaths Number of deaths is the most significant driver of revenue in the death care industry Australia1 New Zealand2 350,000 60,000 1.8% CAGR 2.2% CAGR (2025-2050) 300,000 (2025-2050) 50,000 1.1% CAGR 250,000 1.4% CAGR 0.6% CAGR (2016-2025) 40,000 0.9% CAGR (2016-2025) (1990-201
Slide 27: Death volumes fluctuate
Death volumes fluctuate Death volume growth is forecast to accelerate and prior YoY1 declines rebounded quickly Number of deaths per annum in Australia – 1990 to 20172 203k 180,000 161k +42k in 1 +41k in 27 years 13 years 160,000 140,000 120k 120,000 100,000 2 In 2030, death 80,000 volumes are 60,00
Slide 28: Trading update and outlook
Trading update and outlook Record revenue and funeral volumes in Q1 FY19, despite soft market conditions 1 Q1 FY191: Record revenue (~$24 million, up ~20% on PCP2) and funeral volumes, with: TRADING • Operating EBITDA margin above 26%, consistent with FY18 UPDATE • LFL3 ARPF up on FY18 and within lo
Slide 29: 3. Formal business and resolutions
3. Formal business and resolutions
Slide 30: Proxies received prior to the cut off time
Proxies received prior to the cut off time A total of 168 valid proxy forms were received, and respective shareholdings were accumulated and are summarised below: Resolution For Open Against Abstain resolution as set out below: 2a 31,378,920 16,152,992 10,875 399,652 2b 30,086,005 16,156,992 163,071
Slide 31: Formal business - item 1
Formal business - item 1 Item 1: Receive the financial report, directors’ report and auditors’ report • receive and consider the Company’s financial report, directors’ report and auditor’s report for the year ended 30 June 2018 21
Slide 32: Formal business - item 2(a)
Formal business - item 2(a) Item 2(a): Re-election of existing Director • To re-elect Brian Scullin as a Director who retires by rotation in accordance with the Company’s constitution and being eligible, offers himself for re-election 22
Slide 33: Formal business - item 2(b)
Formal business - item 2(b) Item 2(b): Re-election of existing Director • To re-elect Fraser Henderson as a Director who retires by rotation in accordance with the Company’s constitution and being eligible, offers himself for re-election 23
Slide 34: Formal business - item 3
Formal business - item 3 Item 3: Adopt the remuneration report • That the remuneration report that forms part of the directors’ report of the Company for the financial year ended 30 June 2018 be adopted Note: The vote on this resolution is advisory only and does not bind the directors of the Company
Slide 35: 4. Shareholder's questions
4. Shareholder’s questions
Slide 36: Meeting Close – Thank you
Meeting Close – Thank you PROPEL FUNERAL 26 PARTNERS
Slide 37: Important notice and disclaimer
Important notice and disclaimer This presentation contains summary information about Propel Funeral Partners Limited (ACN 616 909 310) (Propel) and its activities current as at the date of this presentation. Propel assumes no obligation to update such information. The information in this presentatio
Slide 38: Propel Funeral Partners
PROPEL FUNERAL PARTNERS PrP
Propel Funeral Partners — Shareholder Meeting (November 2018) on 6ix