Slide 1: Full Year Results
Full Year Results 30 June 2017
Slide 2: Agenda
Agenda 1. Company Vision 2. Key Achievements 3. Acquisition 4. MVS Earn Out 5. Structure of LMW 6. FY17 Results 7. Revenue Growth 8. Earnings Per Share 9. Market Outlook 10. Our Strategy & Focus 11. Forecast for 2018 12. Investor Relations Timetable 13. Q & A John Wise, CFO & Company Secretary Chris
Slide 3: Disclaimer
Disclaimer This presentation contains statements which could be perceived as ‘forward-looking statements’. Such statements are only expectations or beliefs and are subject to inherent risks and uncertainties which could cause actual values, results or performance achievements to differ materially fr
Slide 4: Company Vision
Company Vision To create Australia’s premier property advisory services company. Through development and acquisition of complementary and diversified service lines.
Slide 5: Key Achievements
Key Achievements • Successful acquisition and integration of MVS creating the largest ASX listed valuation services business. • Awarded 2017 RICS Valuation Team of the Year. • Completed projects targeting efficiencies across the business. • Diversification of services. • Significant investment in cl
Slide 6: Acquisition
Acquisition Why? • Increase scale & geographic spread • Add new revenue streams • Deliver operational efficiencies & shareholder value Acquisition price • MVS was acquired based on 4.5x EBITDA (circa 7x PAT) • LMW trading at 11-13x • Upfront payment of $16M cash plus $7.3M of shares • Earn out payme
Slide 7: Increased National Footprint
Increased National Footprint 44 offices 380+ staff Significant increased footprint in regional QLD, NSW and VIC
Slide 8: MVS Earn-Out
MVS Earn-Out • The residential and commercial businesses of MVS have been merged with the existing LMW's businesses • The government business will continue to be run as a separate division • We have made, and will continue to make, cost savings within the acquired business, including within the sepa
Slide 9: MVS Earn-Out
MVS Earn-Out Current Provided for in Initial estimate of high financial Maximum Consideration water mark1 statements2 Consideration Implied EBITDA 5.2 6.4 7.1 7.8 Earn out business value 23.3 28.8 32.0 35.1 Consideration Cash paid 16.0 16.0 16.0 16.0 Shares issued on completion at $0.60 7.3 7.3 7.3
Slide 10: Structure of LMW
Structure of LMW Owned Franchises Joint Venture • NSW & ACT • NSW • WA & SA - Residential - Commercial - Commercial • Queensland • Sunshine Coast - Residential - Residential - Commercial - Commercial • Victoria - Residential - Commercial • National - Government Shared Services: Finance, IT, Marketin
Slide 11: FY17 Results – Highlights
FY17 Results – Highlights • Gross Revenues including franchised offices & joint venture businesses increased 5.0% to $38.9m. • Revenues from owned businesses increased 9.7% to $25.1m of which 2.2% growth came from the Results existing business and 7.5% from the acquired MVS business. • Net Profit Be
Slide 12: FY17 Results - Summary
FY17 Results - Summary Year ended Year ended Increase/ 30 June 2017 30 June 2016 (Decrease) % Change $000s $000s $000s Revenue Gross revenues (including joint 38,879 37,013 1,866 5% ventures & franchisees) Owned business Continuing operations 23,352 22,849 503 2% Acquired business 1,716 - 1,716 - 25
Slide 13: 2017 v 2016 Results
2017 v 2016 Results 3,500 3,000 • Residential profits 2,500 increased as a result of increased market share in 2,000 a flattening market #039;000 1,500 • Commercial profits are earned predominantly in 1,000 SE Queensland which experienced a downturn 500 in activity • Profit from continuing - operations
Slide 14: Revenue Growth
Revenue Growth Millions 70 LMW Gross Revenues 60 50 40 30 20 10 - 2014 2015 2016 2017 2018FC Owned Joint Venture Business Franchised • Growth in 2017 ($2.3M) was driven by the acquisition of MVS ($1.7M) and organic growth ($0.6M). • Forecast growth in 2018 reflects the benefits from the acquisition
Slide 15: Revenue Growth
Revenue Growth 70 Gross Revenues 70 Owned Revenues Millions Millions 60 60 50 50 40 40 30 30 20 20 10 10 - - 2014 2015 2016 2017 2018FC 2014 2015 2016 2017 2018FC Residential Commercial Government Residential Commercial Government • Prior to acquisition of MVS, LMW earned revenues from Federal & Sta
Slide 16: Earnings Per Share
Earnings Per Share 2015 Actual 2016 Actual 2017 Actual 2017 Normalised 2018 Forecast Profit after tax ($M) 0.779 1.659 1.626 1.826 7.0+ Shares on issues • Start of year 27,588,781 27,588,781 27,669,201 27,669,201 75,930,855 • End of year 27,588,781 27,669,201 75,930,855 75,930,855 75,930,855 • Weigh
Slide 17: Market Outlook
Market Outlook • Residential market has flattened in both Sydney and Melbourne and remained subdued in other locations. • Expecting continuation of flat markets particularly in residential. • Continued strength in commercial activity across Sydney, Melbourne and to a lessor extent, SEQ. • Ongoing co
Slide 18: Our Strategy & Focus
Our Strategy & Focus • Continue to focus on our client engagement strategy. • Capitalise on our greater capacity across major cities and expand on our regional footprint. • Concentrate on expanding our Victorian business. • Expand on the non-mortgage operations across the country. • Continue to look
Slide 19: Forecast for 2018
Forecast for 2018 2018 2017 Our current forecasts for FY2018 remain 2016 in line with those published during the capital raising. – Gross revenues in excess of $60m – Owned revenues in excess of $45m – NPAT in excess of $7m – Full year EPS in excess of 9 cents
Slide 20: Investor Relations Timetable
Investor Relations Timetable • Investor Presentations – Full year results: late August / Early September – Half year results: late February / Early March • AGM – Notice of meeting: late October – Meeting: late November
Slide 21: Questions
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