Hub24 Limited · ASX:HUB
Hub24 — FY2024 Earnings Presentation
33 slides from Hub24's earnings presentation, Aug 20, 2024
Slide 1: FY24 Full Year Results
FY24 Full Year Results 20 August 2024 Empowering better financial futures, together
Slide 2: Overview
Overview 1. Highlights & operating review Andrew Alcock, Managing Director 2. Financial results Kitrina Shanahan, Chief Financial Officer 3. Strategy & outlook Andrew Alcock, Managing Director 2
Slide 3: Highlights & operating review
Highlights & operating review Andrew Alcock CEO & Managing Director 3
Slide 4: Leading the wealth industry as the best provider of integrated platform, technology & data solutions
Leading the wealth industry as the best provider of integrated platform, technology & data solutions Australia’s #1 for annual platform and #2 net inflows across all #1 managed accounts best platform1 retail superannuation net super funds from member capability1 inflows2,3 switching incl industry fu
Slide 5: Consistently delivering growth and shareholder value
Consistently delivering growth and shareholder value Funds under administration Group Revenue1 4-YR CAGR +42% 4-YR CAGR +57% Group UEBITDA1 4-YR CAGR +47% $110b Revenue UEBITDA $100b $350m $120m $90b $110m $300m $100m $80b $90m $70b $250m $80m $60b $70m $200m $50b $60m $150m $50m $40b $40m $30b $100
Slide 6: FY24 financial highlights
FY24 financial highlights1 Revenue Underlying EBITDA² Total Statutory NPAT $47.2m Up 24% Group $327.3m 17% $118.0m 15% Underlying Platform $252.8m 21% $103.0m 21% NPAT2 $67.8m Up 15% Tech Solutions $70.7m 5% $22.1m 1% Final Dividend 19.5cps Up 5% Fully franked5 Total FUA Platform FUA PARS FUA $104.7
Slide 7: FY24 business highlights
FY24 business highlights Record net inflows of $15.8 billion1 Launched new products and #1 Platform across major adviser & industry surveys2 solutions to meet evolving client needs, including: • Discover, a cost-effective Completion of large, complex client migrations and the integration program for
Slide 8: Consolidating our position as Australia's Best Platform
Consolidating our position as Australia’s Best Platform • Overall Best Advice Platform3 • Overall Satisfaction3 • Best Adviser Experience3 • Best Client Experience3 • Ease of Onboarding3 • Best Investment Options3 • Best Online/Call Centre Support3 • Best BDM Support3 #1 Best Overall Platform1 #1 Ov
Slide 9: Growing adviser base supporting net flows and market share gains
Growing adviser base supporting net flows and market share gains Advisers 4-YR CAGR +22% Market share increased from ~2% to ~7% over last 4 years2 29% of advisers use HUB241 #1 organic market share gains over last 12 months2 Advisers using HUB24 and FUA per adviser1 HUB24 custody FUA and market shar
Slide 10: Significant growth opportunity from existing and new advisers
Significant growth opportunity from existing and new advisers Net inflows from new and existing advisers Latent opportunity Composition of net inflows by tenure of adviser relationship HUB24 has access through relationships to FUA per adviser at more than 76% of the total adviser market1 FY24 was $1
Slide 11: myprosperity
myprosperity Leading, secure client portal technology enabling collaboration between financial professionals, enhancing Continued growth in new users and productivity and customer experience opportunity pipeline ~75k 497 Enterprise offer launched with strong households1 wealth practices1 demand - tw
Slide 12: Class and NowInfinity – consistent growth and customer advocacy
Class and NowInfinity – consistent growth and customer advocacy Investing in program of significant enhancements to deliver efficiency & Class accounts Companies on CM enhanced capabilities for SMSFs including direct registry and document feeds 210,000 850,000 800,000 205,000 750,000 200,000 700,000
Slide 13: Enhancing our culture and engaging our people
Enhancing our culture and engaging our people New HUB24 Group Values Aligning our teams and Strengthening our employee value supporting a high-performance proposition for ongoing success culture 893 76% Top quartile1 Developing our diverse and inclusive culture, supported by new Group values FTE at
Slide 14: Building a sustainable business
Building a sustainable business Working with industry experts to prepare for new sustainability reporting standards¹ Diversity & inclusion Committed to United Nations Global Compact to align to UN Sustainable Development Goals Employee Business engagement ethics & integrity Delivered digitisation &
Slide 15: Financial results
Financial results Kitrina Shanahan Chief Financial Officer 15
Slide 16: Group snapshot as at 30 June 2024
Group snapshot as at 30 June 2024¹ Group¹,² Platform¹ Tech Solutions¹ Technology Solutions Corporate Other3 HUBconnect 1% 2% 4% 3% NowInfinity 22% Revenue Revenue $252.8m 29% Revenue $327.3m $70.7m Underlying EBITDA Underlying EBITDA Underlying EBITDA $103.0m $22.1m $118.0m Customer base4 Customer b
Slide 17: Group financial results
Group financial results Operating Revenue ($m) +17% 3.2 0.6 FY24 FY23 Change 44.0 $m $m % 327.3 279.5 Operating Revenue 327.3 279.5 17% Operating Expenses (209.3) (177.1) 18% FY23 Platform Tech Solutions Corporate FY24 Underlying EBITDA1 118.0 102.4 15% Underlying EBITDA margin1 (%) 36.1 36.6 (0.5)
Slide 18: Platform financial results
Platform financial results Strong UEBITDA growth to $103m driven by record net inflows Funds Under Administration ($b) of $15.8b and positive market movements of $5.9b resulting in strong FUA and revenue growth UEBITDA margins stable in FY24 at ~40% 104.7 3.4 1.5 91.2 8.6 20.3 2.5 1.2 80.3 7.2 18.8
Slide 19: Platform custody revenue and revenue margin
Platform custody revenue and revenue margin Platform FUA and Custody Revenue ($m)1 FUA ($m) Revenue ($m) 100,000 300 80,000 250 FUA growth of 35% in FY24 with approximately 75% of the 200 growth driven by net inflows and 25% driven by markets 60,000 150 Platform revenue margin declined 2 bps in FY24
Slide 20: Composition of platform revenue
Composition of platform revenue Portfolio composition of custody FUA and revenue (%) Institutional 6%6% 1% 6% 6% 1% 14% 16% Composition of FUA has seen an increase in Institutional 1% FUA driven by the ~$4b of large migrations for Insignia Financial and Equity Trustees 86% 93% 84% 94% • Institutiona
Slide 21: Platform UEBITDA and margins
Platform UEBITDA and margins Platform Revenue and Expenses ($mn) Revenue Expenses UEBITDA margin $m UEBITDA Margin (%) 300 45 $103.0m Platform UEBITDA for FY24 up 21% on FY23 250 40 35 Platform UEBITDA margin broadly stable at 40.7% in FY24 200 30 with scale benefits offset by the impacts of: 150 25
Slide 22: Tech Solutions financial results
Tech Solutions financial results Delivering consistent and reliable revenue growth of 5% supported by Underlying EBITDA ($m) UEBITDA above system growth in Class and NowInflinity1,2 Margin 32.3% 29.1% 31.3% • Class price increase and disciplined cost management moving $3.0 into FY25 +1% UEBITDA marg
Slide 23: Group expenses and margins
Group Expenses ($m) Group expenses and margins +19% 271.4 +19% 32.4 Investing to support scale and support future growth 239.0 2.4 2.8 227.5 Group expenses before notable items increased 19% YoY 8.8 driven by the acquisition of myprosperity, and investment in (25.9) 19.2 headcount to support the sca
Slide 24: Increasing profitability
Increasing profitability Statutory NPAT up 24% and Underlying NPAT up 15% • $9.5m of strategic transaction and • Higher acquisition amortisation due to • Higher share-based payments due to project costs in relation to Xplore alignment of useful lives of acquired the increase in probability integrati
Slide 25: Strong financial performance and capital management
Strong financial performance and capital management Final dividend of 19.5 cps up 5% YoY Group Operating Cashflow (prior Dividends (cps) • Total FY24 dividends of 38.0 cps to strategic costs and tax) 4-YR CAGR +53% up 17% 4-YR CAGR +43%1 Underlying Diluted EPS (cps) 4-YR CAGR +52% Strong balance she
Slide 26: Strategy & outlook
Strategy & outlook Andrew Alcock Managing Director 26
Slide 27: Evolving industry dynamics providing opportunities
Evolving industry dynamics providing opportunities Demand for professional Client needs driving Financial professionals Regulation & industry advice is increasing, innovation need efficiency to drive transformation is driving supply is limited productivity market dynamics 2.3 million Australians wit
Slide 28: Leveraging our combined capabilities to lead industry change
Leveraging our Be the best provider of integrated platform, To enhance productivity for financial combined capabilities technology and data solutions professionals though to lead industry change • One way of doing business with access to market-leading solutions • Single view of wealth for financial
Slide 29: Delivering on our strategic objectives
Delivering on our strategic objectives Lead today Create tomorrow Build together Be future ready Consolidate market-leadership Further development of data Advocate for positive industry Continued investment in • Enhanced HUB24 Present infrastructure change attracting, retaining & developing reportin
Slide 30: Pursuing profitable growth and maintaining leadership
Pursuing profitable growth and maintaining leadership Strong and reliable Disciplined Strong balance sheet, growth from both management to deliver increasing profitability Platform FUA target existing and new EBITDA margin and cash flows (excluding PARS FUA) customer expansion whilst supporting ongo
Slide 31: Questions?
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Slide 32: Disclaimer
Disclaimer SUMMARY INFORMATION RISK OF INVESTMENT The material herein is a presentation of general background information about An investment in HUB shares is subject to investment and other known and HUB24 Limited’s (‘HUB’) activities current as at date of presentation. This unknown risks, some of
Slide 33: Contacts
Contacts About HUB24 James Cordukes HUB24 Limited is listed on the Australian Securities Exchange, and includes the award-winning HUB24 Platform, HUBconnect, Class and myprosperity. Head of Investor Relations james.cordukes@hub24.com.au The HUB24 platform offers advisers and their clients a comprehe