Peel Hunt Limited · LSE:PEEL
Peel Hunt — H1 FY25 Earnings Presentation
27 slides from Peel Hunt's earnings presentation, November 2024
Slide 1: For the period ended 30 September 2024
For the period ended 30 September 2024 NOVEMBER 2024
Slide 2: Agenda
Agenda Presenters 01 Highlights & Overview Steven Fine Chief Executive Officer 02 Market Update 03 Business Update Sunil Dhall 04 Operating Costs and Balance Sheet Chief Financial & Operating Officer 05 Outlook 06 Q&A A Appendices 2
Slide 3: Highlights and Overview
HIGHLIGHTS AND OVERVIEW
Slide 4: Financial Highlights
Financial Highlights H1 FY25 performance reflected a more positive macroeconomic backdrop Investment Banking Research & Distribution Execution Services Group Revenue Revenue Revenue Revenue £53.8m £22.6m £13.6m £17.6m Adjusted Group Admin Adjusted Compensation Adjusted Staff Costs Non Staff Costs Co
Slide 5: Overview by Area
Overview by Area Capitalising on improving market conditions in the first few months of FY25 Area Overview Key Stats H1 FY25 (H1 FY24) • Continued traction with FTSE 350 Clients, we now act for 4 FTSE 100 companies and Investment Banking 42 FTSE 250 companies. 145 ( 153) • Improved performance in co
Slide 6: Key Messages
Key Messages Performance Market Situation Improved macroeconomic backdrop boosted Cautious optimism now UK Budget and US Election are over performance • Improved market conditions seen over the first few months of FY25 slowed • Improving market conditions in the first few months of over the summer p
Slide 7: Investment Banking | Diversification by clients and products
Investment Banking | Diversification by clients and products Long-term client relationships More to offer corporate Access to different, larger fee based around holistic clients, more often pools investment banking advice Clients Products • Consistent focus on corporates in the UK mid-market and gro
Slide 8: Technology | Embedding Technology in everything we do
Technology | Embedding Technology in everything we do New digital strategy puts technology at the heart of Peel Hunt Overview Case Study: Research New Strategy Leveraging technology • Peel Hunt launched its new Digital Strategy, which emphasises Cloud, • Research technology upgrades have driven rapi
Slide 9: Market Update
MARKET UPDATE
Slide 10: Market Update
Market Update Markets continue to see positive movement but outflows still occurring from UK market Commentary Major Indices Performance (LTM) Major Indices P/E Ratio (NTM) Macroeconomics 140 24x 22x • UK CPI was 2.3% in the 12 months to 135 October 2024, up slightly from 1.7% in the 12 130 20x mont
Slide 11: Market Activity
Market Activity ECM market activity heavily hampered in Q2 FY25 by Budget and US elections Commentary UK Issuance by Product (£m)1 ECM Activity 20,000 18,000 • The first 6 months in 2024 saw a recovery in UK 16,000 ECM activity due to a more stable macroeconomic 14,000 outlook, reduced inflation and
Slide 12: Business Update
BUSINESS UPDATE
Slide 13: Investment Banking Overview
Investment Banking Overview Increased diversification resulted in M&A fees making up the largest proportion of IBD Revenue Key headlines Investment Banking revenue (£m) • Investment Banking, revenues increased by 31% £22.6m to £22.6m (H1 FY24: £17.3m). £17.3m £4.2m • This increase was driven by an i
Slide 14: Investment Banking - Total market cap of clients
Investment Banking -Total market cap of clients Peel Hunt outperforms competitors relative to its size on its client’s aggregated market cap • The consolidation seen across the market in Total Market Cap Total Number of Number of FTSE of Stock Market Market Cap of 2023, has continued at the smaller
Slide 15: Execution Services Overview
Execution Services Overview Consistent returns in a subdued market Key headlines Execution Services revenue breakdown • Execution Services revenues were £17.6m, an H1 23 H1 24 H1 25 increase of 19% period on period (H1 FY24: Small-cap / AIM £14.8m). FTSE 350 International • Trading volumes increased
Slide 16: Research & Distribution Overview
Research & Distribution Overview Expanding reach supports growing relationships Key headlines Research and Distribution revenue • Revenues in our Research & Distribution business £13.6m were modestly up on the same period last year at £11.3m £10.5m £13.6m (H1 FY24: £10.5m), despite continued £23.6m
Slide 17: Operating Costs and Balance Sheet
OPERATING COSTS AND BALANCE SHEET
Slide 18: Operating Costs Overview
Operating Costs Overview Commentary Adjusted Staff costs (£m) 57.6% 57.8% • Adjusted Staff costs1 were higher than the 50 54.8% 60.0% prior period due to an increase in accrued 40 55.0% variable compensation, targeted salary 30 50.0% increases to ensure that we remain 20 £23.7m £24.7m £29.5m 45.0% c
Slide 19: Balance Sheet & Capital Position Overview
Balance Sheet & Capital Position Overview Commentary Cash Position and Net Asset Value • Net assets remained strong at £94.8m as at £92.8m £91.8m £94.8m 30 September 2024 (H1 FY24: £92.8m). The increase is driven by the profit for H1 FY25 and an increase in the share-based payment reserve. £37.9m £2
Slide 20: Outlook
OUTLOOK
Slide 21: Current Trading and Outlook
Current Trading and Outlook Current Trading Outlook • Macro-economic news including Trump policies (tariffs, • Trading improved in October after a difficult September for Ukraine) and UK economic data will influence trading AIM stocks due to concerns on IHT status prior to the conditions. Execution
Slide 22: Q&A
Q&A
Slide 23: Appendices
APPENDICES
Slide 24: Income Statement
Income Statement Income Statement £’000 H1 FY25 H1 FY24 Change Research payments & Execution commission 13,616 10,503 29.6% Execution Services revenue 17,592 14,834 18.6% Investment Banking fees and retainers 22,579 17,340 30.2% Revenue 53,787 42,677 26.0% Adjusted staff cost* (29,425) (24,672) 19.3
Slide 25: Consolidated Balance Sheet
Consolidated Balance Sheet Balance Sheet £’000 H1 FY25 FY24 Change Non-current assets 22,321 23,144 (3.6%) Securities held for trading 61,297 60,104 2.0% Market and client debtors 460,147 551,943 (16.6%) Trade and Other debtors 13,767 19,613 (29.8%) Cash and cash equivalents 18,041 37,929 (52.4%) Cu
Slide 26: Consolidated Statement of Cash Flows
Consolidated Statement of Cash Flows Cash Flow £’000 H1 FY25 H1 FY24 Change Net cash generated from operations 1,461 5,019 (70.9%) Cash flows from investment activities Purchase of tangible assets (179) (60) 198.3% Purchase of intangible assets (165) (815) (79.8%) Investment in associates - (550) (1
Slide 27: Disclaimer/Risk Warning
Disclaimer/Risk Warning This document has been prepared by Peel Hunt LLP (“Peel Hunt”) and is for the use of the addressee only. It may not be copied or distributed to any other person without the written consent of Peel Hunt. This document has been prepared using sources believed to be reliable and