Smartgroup Corporation Ltd · ASX:SIQ
Smartgroup — Shareholder Meeting (May 2022)
42 slides from Smartgroup's shareholder meeting presentation, May 11, 2022
Slide 1: 2022 AGM presentation materials
ASX Announcement For personal use only Release date: 11 May 2022 2022 AGM presentation materials Attached are the following documents to be presented at the 2022 Annual General Meeting (AGM) of Smartgroup Corporation Limited (ASX: SIQ) to be held at 11.00am this morning at Wesley Conference Centre,
Slide 2: Chairman's Address: Introduction and 2021 results
SMARTGROUP CORPORATION LIMITED 2022 ANNUAL GENERAL MEETING – CHAIRMAN AND CEO’S ADDRESS For personal use only 11.00 AM, WEDNESDAY 11 MAY 2022 CHAIRMAN’S ADDRESS Introduction and 2021 results In 2021, the ongoing impacts from the COVID-19 pandemic continued to create a challenging trading environment
Slide 3: Chairman's Address: supply chain and sustainability
Delays in the global vehicle supply chain affected the settlement timeframes for novated leasing vehicles, resulting in a large pipeline of future deliveries which has continued in the early parts of 2022. For personal use only At Smartgroup, we are conscious of our role as part of the broader commu
Slide 4: 2022 update and shareholder returns
2022 update I will now make some brief comments about the company’s performance to date in 2022. For personal use only We are pleased with the start to 2022. In the four months to 30 April, Smartgroup has made sound progress, recording revenue and EBITDA in line with expectations and in line with th
Slide 5: Conclusion and CEO's Address
Conclusion In conclusion, I would like to thank Tim, the entire management team and all of our employees for their hard work and strong focus throughout 2021. For personal use only I would also like to thank our loyal clients, suppliers and shareholders for their ongoing support and to take this opp
Slide 6: Smartgroup overview and business model
Smartgroup is one of Australia’s leading employee management services businesses with approximately 700 team members managing more than 380,000 customers and approximately 90,000 cars, in both novated and fleet. For personal use only Smartgroup’s investment proposition to shareholders is underpinned
Slide 7: Client segments and progress over 24 months
for around 23% of our clients and government and education around 30%. All of these segments have had good employment growth with long tenured employees. Over the last 24 months, we have made substantive progress in improving our For personal use only business to navigate challenges and have progres
Slide 8: 2021 highlights
We are very pleased with our 2021 results which reflect the continued momentum of our business. Throughout another year of disruption, Smartgroup and our team members remained flexible to deliver exceptional client and customer experiences For personal use only and strong business outcomes. Througho
Slide 9: Our Smart Future Program
And finally, our capital light business model continues to generate a strong level of free cashflows. After-tax cashflows are in excess of NPATA and we have very low net debt. For personal use only Our Smart Future Program Now I would like to give an update on our Smart Future program that we announ
Slide 10: Smart Future pillars and growth room
Within this addressable market, we have approximately 380,000 customers and we manage around 65,000 cars. We think there is room for good levels of organic growth over the medium term. For personal use only This time last year, we announced Smart Future, our program to drive organic growth and to so
Slide 11: Customer experience and digital investment
To date, approximately 149,000 salary packaging cards as well as 78% of clients and 74% of customers have transitioned. This has brought about more consistency in servicing as well as enabling customers to access a broader benefits suite. For personal use only Our goal is to provide a great customer
Slide 12: Leasing calculator outcomes and Smartsalary website
already seen strong outcomes. Calculator visitations, as represented by the blue dashed line, have increased since launch and the customer leads, as represented by the red line, have grown faster than visitations. Customer engagement, as For personal use only measured by time spent on the calculator
Slide 13: Business update to April 2022
We are excited by these two launches and we will report back on the outcomes. Business Update to April 2022 For personal use only I would now like to give you an update on our business and its progress so far in 2022. For the first 4 months to April, we are seeing continued strong leasing leads. Lea
Slide 14: Operations update and outlook
We also launched an API to automate financing with a second partner, enabling us to diversify our funding sources. Despite the continued tight car supply market, Revenue and EBITDA are in line For personal use only with our expectations and with the prior comparative period. Our balance sheet remain
Slide 15: Annual General Meeting 2022
For personal use only Annual General Meeting 2022
Slide 16: Chairman's Address
For personal use only 01 Chairman’s Address Michael Carapiet 2
Slide 17: Smartgroup Board of Directors
Smartgroup Board of Directors For personal use only Gavin Michael Deborah Bell Carapiet Homewood Chairman and Non-Executive Non-Executive Non-Executive Director Director Director Andrew Tim John Bolam Looi Prendiville Non-Executive Managing Director Non-Executive Director and CEO Director Carolyn An
Slide 18: 2021 results: improvement in all financial metrics
2021 results an improvement in all financial metrics versus 2020 with total dividends of 72cps For personal use only Revenue EBITDA1 NPATA1 Dividend (fully franked)2 1. Adjusted to reflect one-off impact on adoption of AASB 16 Leases from January 2018. Impact is to increase 2018 EBITDA by $1.6m in e
Slide 19: A focus on culture and sustainability
For personal use only A focus on culture and sustainability We’re committed to empowering our diverse and inclusive workforce, and to promoting equality at all levels. Gender diversity targets of 40/40/20* Commitment to equal pay, Smartgroup Foundation gave ESG Committee established in 2021 WGEA Emp
Slide 20: Financial performance
For personal use only Financial performance Revenue and EBITDA in line with our expectations and pcp Low net debt of $47m and leverage of 0.5x EBITDA, 2022 following payment of 2021 final ordinary and special dividends Update Strong vehicle order levels continuing Settlement volume is impacted by ve
Slide 21: Shareholder returns
Shareholder returns For personal use only Since listing in 2014, Smartgroup has paid ~$388m in fully franked dividends (~$166m franking value) ~$160M SIQ Market Cap | 2 July 2014 ~$1.1B SIQ Market Cap | 6 May 2022 1,200% Performance indexed to 100 at July 2014 1,100% 1,000% Smartgroup market 900% c
Slide 22: Managing Director and CEO's Address
For personal use only 02 Managing Director and CEO’s Address Tim Looi
Slide 23: Smartgroup Leadership Team
Smartgroup Leadership Team For personal use only Justine Anthony Tania Sarah Carmichael Dijanosic Cumming Haas Chief People Chief Financial Chief Customer Chief Operating Officer Officer Officer Officer Bijal Tim Alfonzo Sophie Desai Looi Venturi MacIntosh Chief Risk Managing Director Chief Chief Le
Slide 24: Our investment proposition
Our investment proposition For personal use only Smartgroup’s investment proposition is underpinned by a capital light business model, generating strong cash flows and dividends 382,500 63,100 24,750 ~700 Salary Packaging Novated Fleet Vehicles Full Time customers Leases Managed Equivalents Premiu
Slide 25: What we do
What we do For personal use only At Smartgroup, we simplify salary packaging, fleet management and a range of other employee benefit services for organisations across Australia 11
Slide 26: Who we serve
Who we serve Corporate For personal use only Education 4% 10% Our employer clients and employee customers Government • Not-for-Profit – 20% charities, disability and aged care providers • Hospital – Hospital 382,500 public and private 23% Salary Packaging • Government – customers local, state and fe
Slide 27: Resilient performance, building capability and streamlining operations
Resilient performance, building capability and streamlining operations For personal use only We have navigated challenges and progressed important integrations Diversity and Inclusion Regulatory COVID Margin Acquisition Management Compression Integration Strength Successfully implemented Continued t
Slide 28: 2021 full year results recap
For personal use only 03 2021 full year results recap
Slide 29: Results to December 2021
Results to 31 December 2021 Pleasing results reflect continued momentum For personal use only Strong improvement in profit • Revenue of $221.8m up 3% vs CY 2020 • Operating EBITDA of $103.0m up 8% vs CY 2020 • NPATA1 of $69.5m up 7% vs CY 2020 Successful renewal outcomes with improved operating perf
Slide 30: Results to December 2021 (continued)
Results to 31 December 2021 Pleasing results reflect continued momentum For personal use only Smart Future program delivering targeted benefits • 12% increase in digital leads for new leases • 80% increase in customer engagement with the new leasing calculator • 13-point increase in leasing sales cu
Slide 31: The Smart Future Program
For personal use only The 04 Smart Future Program
Slide 32: Significant organic growth opportunities from existing clients
Significant organic growth opportunities from existing clients For personal use only Addressable market Addressable market c.1.2-1.5m1 employees c.0.9-1.2m2 total cars owned within existing client base by those employees = 60,000 employees (potential customers) = 60,000 cars (potential Smartgroup no
Slide 33: Smart Future Program
Smart Future Program Launched May 2021 For personal use only Vision Be the trusted partner for Australian employers to deliver benefits to their employees Strategic capabilities Customer experience Technology People and culture Brands Scale Strategic pillars Deliver great customer Invest in digital
Slide 34: Increased focus on digital engagement
Increased focus on digital engagement and improved experiences have led to growth in digital novated leads and For personal use only better lead conversion Novated leasing leads have reduced from 2019 with restricted on-site access Novated leads by channel and conversion rates Increased focus on dig
Slide 35: New Smartleasing vehicle calculator results
New Smartleasing vehicle calculator has seen sustained improvement in customer engagement and leads For personal use only c.40%+ increase in calculator traffic and c.60%+ increase in calculator leasing leads1 c.80% increase in the time customers spend interacting with calculator/self-educating1 Incr
Slide 36: New digital assets: Smartsalary website
For personal use only We will launch new digital assets promoting education and digitising interactions New Smartsalary website Simpler Better user experience Improved data analytics 22
Slide 37: New vehicle sales portal
For personal use only Customers will be able to engage with Smartgroup for novated leasing digitally 24/7 New vehicle sales portal Digitising customer education and interactions End-to-end sales process when all development phases are complete 23
Slide 38: Business update to April 2022
For personal use only 05 Business update to April 2022
Slide 39: Strong leasing lead generation and pipeline
Strong leasing lead generation and pipeline For personal use only Lead to Vehicle Order conversion rates are stable Apr 2022 V PCP CY 2021 YTD Strong leasing Total leasing leads +1% +6% lead generation and Lower-cost digital lead ‘excess’ new vehicle volumes have grown beyond pre-COVID levels New le
Slide 40: Operations and financial performance update
For personal use only Operations Salary packaging customers up c.5,000 (+1%) since December 2021 Return to office for Smartgroup team members across Australia Novated funding panel Transition from St George to Angle complete, including early Update payment by St George of future performance fees API
Slide 41: Important notice and disclaimer
Important notice and disclaimer Disclaimer For personal use only This presentation has been prepared by Smartgroup Corporation Ltd (ACN 126 266 831) (“Smartgroup”) and is general background information about Smartgroup’s activities current as at the date of this presentation. The information is give
Slide 42: For personal use only
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