Netwealth Group Ltd. · ASX:NWL
Netwealth — H1 2025 Earnings Presentation
42 slides from Netwealth's earnings presentation, Feb 20, 2025
Slide 1: Results Presentation 1H25
See wealth differently Results Presentation 1H25 20 February 2025 Disclaimer: This document is for general use. Modification of content is prohibited unless you have Netwealth’s express prior written consent. 1 NWL Results Presentation 1H25 20 February 2025
Slide 2: Important notice and disclaimer
Important notice and disclaimer General Information only any forecast result will be achieved, or that there is a reasonable basis for any of these statements or forecasts. Forward-looking statements speak only as at the date of this Information provided is general information presented in a summary
Slide 3: Our purpose
Our purpose is To enable people to see wealth differently and discover a brighter future 3 NWL Results Presentation 1H25 20 February 2025
Slide 4: Today's presenters and agenda
Today’s presenters and agenda Meet Discover 1. 1H25 business and financial highlights 2. Strategy and product update 3. Corporate sustainability Matt Heine CEO & Managing Director 4. 1H25 financial performance 5. Outlook 6. Questions Hayden Stockdale 7. Appendix and additional information Chief Fina
Slide 5: Acknowledgement of Country
Acknowledgement of Country We acknowledge the traditional owners of the lands that we work and live on. Our office here in Melbourne is on the lands of the traditional owners, the Wurundjeri people of the Kulin Nation. We celebrate the stories, culture and traditions of the Aboriginal and Torres Str
Slide 6: 1H25 Business & financial highlights
1H25 Business & financial highlights 6 NWL Results Presentation 1H25 20 February 2025
Slide 7: 1H25 Highlights
1H25 Highlights Record growth across key metrics including net flows, income, and profit. Total FUA as at 18 February 2025 was $105.4B, with net inflows for 3Q25 to date of $1.5B FUA $101.6B +$23.6B +30.2% FUA net flows $8.5B +$3.8B +80.2% Total income $155.4M +$32.0M +26.0% EBITDA $78.0M +$19.3M +3
Slide 8: 1H25 Highlights
1H25 Highlights NPAT $57.6M +$18.3M +46.6% No. of accounts 151,437 +18,611 +14.0% Cash transaction $5.7B +$1.1B +22.6% account - average FUM $24.0B +$5.9B +32.9% + Changes compared to 1H24 8 NWL Results Presentation 1H25 20 February 2025
Slide 9: Consistent growth and operational efficiency
Consistent growth and operational efficiency Conversion of FUA to EBITDA FUA growth Income growth EBITDA margin EBITDA growth 1H25 +30.2% +26.0% 50.2% +32.8% 1H24 +24.9% +20.0% 47.6% +27.2% 1H23 +10.2% +18.9% 44.9% +10.0% + Changes compared to prior year 1H 9 NWL Results Presentation 1H25 20 Februar
Slide 10: Consistent track record of growth
Consistent track record of growth Growth in FUA, FUM and Income $155.4M $123.3M $102.8M $86.4M $74.2M $101.6B $78.0B $62.4B $56.7B $38.8B $13.8B $14.4B $18.1B $24.0B $9.3B Dec-20 Dec-21 Dec-22 Dec-23 Dec-24 FUA FUM Total income FU A 4- y ear C AG R o f 2 9. 3% 10 NWL Results Presentation 1H25 20 Feb
Slide 11: Broad-based growth across customer tiers
Broad-based growth across customer tiers Successful strong expansion in key high-value segments Strong expansion of high-value customer tiers Client type Growth in new products targeting Emerging and Mass Affluent and UHNW customers Retail HNW UHNW & Family Office Institutional Investment Retail Inv
Slide 12: Consistent track record of growth and market share gains
Consistent track record of growth and market share gains Netwealth is a leading specialist investment platform, increasing market share by 13.9% (100 bps) to 8.2%. Legacy platforms (with 56.1% of the market) are losing market share Platform providers by FUA and market share % at 30 Sep 24 and market
Slide 13: Structural shift continues and shows no signs of slowing down
Structural shift continues and shows no signs of slowing down Significant beneficiary of structural change leading to increased market share; +13.9% (100 bps) in 1 year; +183% (530 bps) in 5 years. Quarterly market share analysis (Sep 19 to Sep 24) Rotation from legacy platforms Technology change &
Slide 14: Transition pipeline underpins continued growth
Transition pipeline underpins continued growth Track record of growing FUA from existing and new financial intermediaries, over multiple years FUA net flows in CY24 by cohort year of Financial Intermediary (FI) FUA net flows by cohort year of new FIs (CY22 – 24) $15.0B Consistently grown FUA net FUA
Slide 15: Strategy and product update
Strategy and product update 15 NWL Results Presentation 1H25 20 February 2025
Slide 16: Our strategic advantage
Our strategic advantage We seek to drive change that matters by delivering innovative products and service that leverage data, technology and connectivity Our advantage is that we drive WEALTHTECH INSIGHTS & change that matters by delivering Powerful transaction, ANALYTICS innovative products and se
Slide 17: Netwealth's advantage | Wealth solutions
Netwealth’s advantage | Wealth solutions Our value proposition supports key market segments and levels of sophistication Maintain & invest in Exclusive investment opportunities market-leading position & deal flow Non-custodial Wealth Accelerator MAPS SOPHISTICATION OF NEEDS Wealth Accelerator Plus S
Slide 18: Netwealth's Advantage | WealthTech
Netwealth’s Advantage | WealthTech Our tech stack provides powerful transaction tools and efficient and engaging adviser & client solutions ENGAGE Client App Adviser Licensee Third-Party Model Investment & Portal Portal Portal Professional Manager Manager Portal Portal Portal TRANSACT Unlisted Liste
Slide 19: Netwealth's advantage | Partners & integrations
Netwealth’s advantage | Partners & integrations Netwealth integrates deeply with a broad and growing range of specialist technology providers DATA, TECHNOLOGY & INVESTMENT, RESEARCH WEALTHTECH PLATFORM FUNCTIONALITY & PORTFLIO TOOLS Xeppo InvestmentLink PIMS SS&C Class Financial Simplicity Microsoft
Slide 20: Netwealth's advantage | Insights & analytics
Netwealth’s advantage | Insights & analytics Powerful insights & analytical tools help licensees, advisers & their clients better understand their business & investments 50+ practice reports Practice & licensee management dashboard 19 client reports COMING SOON: Sophisticated 30+ practice-level port
Slide 21: Delivering on our strategic roadmap
Delivering on our strategic roadmap Netwealth continues to extend our strategic advantage, building on our leading capabilities and addressing emerging opportunities coming soon Bulk client Accelerate New super 690+ non- Workflow Expansion of our Secure document reporting Summit onboarding custodial
Slide 22: Netwealth's advice enablement strategy
Netwealth’s advice enablement strategy Growing numbers of pre-retirees and a persistent advice gap mean demand will continue to outstrip supply. Netwealth’s advice enablement strategy multiplies the efforts of our advisers, allowing them to serve more clients 1:5 7.2m 129 For every 1 Australian Aust
Slide 23: Corporate Sustainability
Corporate Sustainability 23 NWL Results Presentation 1H25 20 February 2025
Slide 24: Netwealth's corporate sustainability
Netwealth’s corporate sustainability Core business supported by a genuine and transparent commitment Foster diversity, talent and wellbeing Be genuine and transparent in our dealings • Employee engagement score = 7.9, top half of our • SOC 2 reasonable assurance from our Auditors industry peers • Re
Slide 25: 1H25 Financial performance
1H25 Financial performance 25 NWL Results Presentation 1H25 20 February 2025
Slide 26: Improving growth and efficiency driving profit
Improving growth and efficiency driving profit Record half of FUA net flows, revenue growth and profit growth • Achieved a Rule of 40 score1 of 76.2 Growth percentage increase in FUA net flows, FUA, total income, EBITDA margin, EBITDA, operating net cash flow before tax and NPAT 1H24 to 1H25 +30.2%
Slide 27: Strong financial performance
Strong financial performance 1H25 23.4 2H24 17.9 Financials 1H25 1H24 Change % Change Platform Revenue 150.8 120.7 30.1 24.9% EPS (cents) 1H24 16.1 Other Income 4.6 2.6 2.0 76.2% 2H23 14.9 Total Income 155.4 123.3 32.0 26.0% Employee Benefits Expenses 52.3 44.6 7.7 17.3% 1H23 12.5 Share Based Paymen
Slide 28: Platform revenue is diversified in its nature and sources
Platform revenue is diversified in its nature and sources Platform revenue of $150.8M, up 24.9%, with a 2-year CAGR of 21.8% Platform revenue split 1H23 to 1H25 • Further improved the diversification of revenue base to 1H24 $150.8M • Transaction fee income increased by 48.2% to $120.7M 6% represent
Slide 29: Operating leverage delivered
Operating leverage delivered While continuing to invest in our people, product, security and technology capabilities. Total operating expenses for 1H23 to 1H25 Operational leverage delivered with expenses up 19.8% (620 bps less than total income). +$12.8M +$8.0M $77.4M 19.8% 14.1% Main. source of op
Slide 30: Investing in people to support growth
Investing in people to support growth 51 additional roles to support growth, service, innovation and technology, including 22 from the acquisitions of Xeppo and Flux. Xeppo and Flux acquisition Operational headcount of 664 people at 31 Dec 24 Headcount by function 31 Dec 24 3% Technology 1 22 3% 13
Slide 31: Strong operational performance
Strong operational performance Platform statistics 1H25 1H24 Change % Change Platform metrics and highlights 1H25 (increase to 1H24) Funds Under Administration (FUA) 100,878 77,772 23,106 29.7% • Record FUA net flows of $8.5B, up 80.2% and both FUA - Custodial FUA - Non-custodial 694 228 466 204.2%
Slide 32: Key performance metrics
Key performance metrics Focused on delivering a market leading innovative platform is delivering growth in the size and value of customer accounts Average FUA/average no. of accounts ($'000) Annualised platform Revenue/average FUA Annualised platform Revenue/average no. of (bps) accounts ($) 647 2,0
Slide 33: Summary | Strong financial and market position
Summary | Strong financial and market position Strong FUA growth and Strong operating leverage Investing for the future momentum • Expenses growing at 620 bps • Ongoing strategic investment • Two consecutive record lower than revenue across technology quarters of FUA net inflows • EBITDA margin expa
Slide 34: Outlook
Outlook 34 NWL Results Presentation 1H25 20 February 2025
Slide 35: AI @ Netwealth
AI @ Netwealth Leverage the capabilities of AI to create innovative solutions and optimise processes across the following key areas Back office Customer service Client products and services • Automation of repetitive • Call transcription, and routine Tasks monitoring and • Portfolio reporting and •
Slide 36: Outlook
Outlook Invest to capitalise on both existing and emerging market opportunities, to drive sustainable profit growth and benefits to our customers and members Provide greater practice Advanced several planned Our advice enablement management, business initiatives and continue to strategy multiplies t
Slide 37: Outlook
Outlook Invest to capitalise on both existing and emerging market opportunities, to drive sustainable profit growth and benefits to our customers and members We continue to broaden the functionality of On 1 March 2025 there will be an update to From 1 July 2025, changes to APRA’s our platform, reduc
Slide 38: Outlook
Outlook Invest to capitalise on both existing and emerging market opportunities, to drive sustainable profit growth and benefits to our customers and members • Netwealth remains in an excellent financial position: • Highly profitable, with strong EBITDA margin; • An exceptional correlation between E
Slide 39: Questions
Questions 39 NWL Results Presentation 1H25 20 February 2025
Slide 40: 1H25 Appendix and additional information
1H25 Appendix and additional information 40 NWL Results Presentation 1H25 20 February 2025
Slide 41: Cash Flow
Cash Flow The table below sets out the summary of the consolidated statement of cash flows for 1H25 and 1H24 Consolidated Group for Period Ended 1H25 1H24 Change Change $’M $’M $’M % Receipts from customers 156.5 122.9 33.6 27.3% Payments to suppliers and employees (84.4) (65.7) (18.7) (28.4%) Divid
Slide 42: Operational Risk Financial Requirement (ORFR)
Operational Risk Financial Requirement (ORFR) Cost of capital recovery on ORFR classification and disclosure has been revised and presented as Platform revenue. Prior periods have been reclassified to be consistent with current period disclosure; Consolidated Group for Period Ended Cost of capital r