Kelly Partners Group Holdings Ltd. · ASX:KPG
Kelly Partners — H1 2025 Earnings Presentation
50 slides from Kelly Partners's earnings presentation, February 2025
Slide 1: 1H25 Results
February 2025 1H25 RESULTS KELLY PARTNERS GROUP HOLDINGS LIMITED (ASX: KPG) Brett Kelly Kenneth Ko Founder and CEO CFO 594 104 38 4 $65m $134m 44.9m 11.0cps 26% Team Partners Businesses Countries 1H25 Revenue Rev run rate Shares 1H25 FCF per ROIC + Org Gr share
Slide 2: Contents
Contents Section One 1 Highlights Page 4 Section Two 2 Page 18 About Section Three 3 Page 23 Capital Allocation Section Four 4 Page 26 Financial Highlights Section Five 5 Page 33 US Listing 2 1H25 Results
Slide 3: Henry Singleton quote on flexibility
I don't believe all this nonsense about market timing. Just buy good value and when the market is ready that value will be recognized. I know a lot of people have very strong and definite plans that they've worked out on all kinds of things, but we're subject to a tremendous number of outside influe
Slide 4: Highlights
Highlights 4 1H25 results
Slide 5: KPG in 10 seconds
KPG in 10 seconds Profit & loss Balance sheet Cashflow Revenue Margin Parent NPATA Return Gearing Cashflow Efficiency +22.8% -2.5% +12.0% 36.5% -0.45x +18.9% +1.6% Revenue EBITDA Underlying NPATA Return Net debt to underlying Operating Cash Growth Margin Growth on Equity EBITDA cashflow Conversion 1
Slide 6: 18 Years of Growth (Doubled 6 times) due to KPG Business System
18 Years of Growth (Doubled 6 times) due to KPG Business System Revenue Double Double Double Double Double Double 2007 2008 2009 2013 2017 2022 $160.0 1 Year 1 Year 4 Years 4 Years 5 Years 3 Years $140.0 $120.0 1 2 3 4 5 6 $134.0m $108.1m $100.0 30% $86.5m $m $80.0 $55.3m Revenue $64.9m CAGR* $42.5m
Slide 7: Performance
Performance Strong revenue growth EBITDA 2.5x since FY20(1) Successful programmatic acquisition strategy A$m A$m Acquired revenue growth 21% 5YR CAGR 19% 5YR CAGR 30 32 21% 5YR average 120 108 28.7% 84 22 26.5% 26.3% 20 65 16 18.8% 13 45 49 4.8% FY20 FY21 FY22 FY23 FY24 1H25 TTM FY20 FY21 FY22 FY23
Slide 8: Progress in 5-year periods
Progress in 5-year periods 1. Start-up 2. Foundation 3. Build 4. Accelerate $140.0m $134.0m $120.0m $108.1m $100.0m $80.0m 30%Revenue CAGR $60.0m $48.9m $46.9m 35% Margin $40.0m $30.2m $30.0m 28% Margin ~$10.0m- $16.0m $20.0m 33% Margin $13.0m $8.7m $7.8m 29% Margin $5.1m $8.0m $2.0m $0.0m $3.4m FY0
Slide 9: KPG Earning Power
KPG Earning Power Income Statement Summary ($m) 1H25 Run Rate – Low Run Rate - High Professional services revenue $64.9 $134.0 $134.0 Other income $0.3 $0.6 $0.6 Total Revenue $65.2 $134.6 $134.6 Operating Expenses -$47.0 -$94.2 -$87.5 EBITDA – Operating Businesses $18.2 $40.4 $47.1 EBITDA – Operati
Slide 10: 1H25 Profitability
1H25 Profitability Accounting Accounting Accounting Operating Businesses Other Services Total Total inc. Subscale US* Total Established Growth Subscale Revenue $46.7 $6.1 $3.4 $56.2 $0.7 $56.9 $8.0 $64.9 EBITDA^ $14.8 $1.6 $1.0 $17.5 $0.1 $17.6 $0.7 $18.2 EBITDA Margin % 31.6% 27.0% 30.7% 31.1% 13.8
Slide 11: Capital Allocation – Half Year
Capital Allocation – Half Year KPG aims to build per-share intrinsic value by: 1H18 1H19 1H20 1H21 1H22 1H23 1H24 1H25 Improving the earning power of our operating 26.9% 25.5% 34.0% 33.9% 33.5% 30.3% 30.6% 28.1% 1. businesses EBITDA margin of operating businesses Further increasing their earnings th
Slide 12: Capital Allocation – Full Year
Capital Allocation – Full Year KPG aims to build per-share intrinsic value by: FY18 FY19 FY20 FY21 FY22 FY23 FY24 Improving the earning power of our operating 34.0% 27.7% 32.5% 33.4% 30.9% 27.3% 29.6% 1. businesses EBITDA margin of operating businesses 17.2% 6.4% 6.6% 4.8% 26.5% 28.7% 26.3% 2. Furth
Slide 13: KPG Performance Scoreboard
KPG Performance Scoreboard Kelly Partners Performance v ASX 300 Difference Adjusted Book in Per Share (per share KPG Value* Inc. Annual % Weighted Average Book Value of Annual % KPG.ASX Annual % ASX 300 Annual % market v ASX Cumulative Financial year Dividends Paid Change No. of Shares KPG Change Sh
Slide 14: KPG Performance Scoreboard
KPG Performance Scoreboard KPG Adjusted Book Value vs KPG.ASX vs. ASX 300 (2009-2024) Shares issued to date rebased to 100 pre 2012 Shares issue pre 2012 $605,800 16,000 2014 Shares issued 2014 $1,078,611 2016 Shares issued pre-IPO $1,835,500 14,000 2017 Shares converted from Con Note $8,125,000 201
Slide 15: EPS & Free Cashflow per Share (Owners' earnings per share)
EPS & Free Cashflow per Share (Owners’ earnings per share) 45,400,000 45,000,000 45,000,000 45,000,000 45,000,000 44,900,000 19.18 19.03 17.84 17.44 14.03 13.99 13.33 11.72 11.11 11.33 8.55 8.67 FY20 FY21 FY22 FY23 FY24 1H25 TTM Free Cashflow (FCF) per share Earnings per Share Number of Issued Share
Slide 16: Share Buy Backs
Share Buy Backs 597,181 shares repurchased since IPO, with no new shares issued. • In line with KPG’s strategy KPG Date Closing Shares Shares Repurchased % Repurchased intends to build per-share intrinsic Open at IPO 45,497,181 value by repurchasing KPG Shares when they are available at a 30 Jun 18
Slide 17: Accounting Industry PE Deal Update
Accounting Industry PE Deal Update Kelly Partners Group Corporate P/E Relationship Partnership / Personal Corporate Transaction Term Long term Medium term Short term Price versus value(s) Values and Price Price Price Leadership Founder Led CEO Led P/E Led Industry Expertise in your size and type of
Slide 18: About
About 18 1H25 results
Slide 19: Locations
Locations 35 UNITED STATES: 7 INDIA: 1 HONG KONG: 1 AUSTRALIA: 26 19 1H25 results
Slide 20: Leading Platform
Leading Platform People 594 team members 35 office locations 57 partnerships 93% Great Place Inc. 104 operating partners 26 Australia and 9 global Since inception to Work® Clients 25,000 active clients 95% tax & accounting 5% organic growth p.a. +72 NPS vs across Australia & US Proportion of FY24 re
Slide 21: Strategy
Strategy Objective Top 10 in Australia Go Global Grow to become a top 10 accounting firm in Australia Growing Kelly+Partners Business System in global markets Scope Financial Review Top 100 Accounting Firms ($m) Deloitte Rev ($m) 2,780.0 Est. % Audit EY 2,500.0 PwC 2,350.0 KPMG 2,230.0 1 BDO 540.1 F
Slide 22: Partnerships
Partnerships ~6x Pre-IPO 14 average ~1 per annum 41 average ~6 per annum Firms 52,409 10% Prospects 5,355 IPO 8% Leads 444 9 8 7 Opportunities 6 X 4 4 3 3 3 2 2 Conversions 1 1 1 1 X 0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 20
Slide 23: Capital Allocation
Capital Allocation 23 1H25 results
Slide 24: ROIC
ROIC “And when we think about Invested Capital, we think about the shareholder capital that has been invested in the businesses, plus any Adjusted Net Income less any distributions. Obviously, when you divide Adjusted Net Income by Invested Capital, you get a measure of the return on our shareholder
Slide 25: Additional Investment
Additional Investment • Additional investment of $0.8m Sources of capital Use of capital (1.3% of revenue) to ensure we can • Internal cashflow • Invest in existing operations • Pay down debt handle next stage of growth • Issue debt • Buy other companies • Pay dividends • Additional investment as a
Slide 26: Financial Highlights
Financial Highlights 26 1H25 results
Slide 27: Financial Highlights
Financial Highlights 1 Owner earnings – calculated as Cash from Operating 1H25 Financial Highlights (m) KPGHL & Controlled Entities KPGHL Attributed (parent only) Activities less Payments for Lease Liabilities less P&L and Cashflow 1H24 1H25 % Change 1H24 1H25 % Change Maintenance Capex. Revenue $52
Slide 28: Income Statement
Income Statement Income Statement Summary ($m) Professional services revenue 1H24 $52.9 1H25 $64.9 ∆% 22.8% Other income $0.3 $0.3 4.2% Revenue of Operating EBITDA margin at Total Revenue $53.1 $65.2 22.7% $64.9m 31.0% / 28.1% Operating Expenses EBITDA – Operating Businesses -$36.9 $16.2 -$47.0 $18.
Slide 29: Balance Sheet
Balance Sheet WIP Days Debtor Days • Net Debt / Underlying EBITDA of 1.49x (FY24: 1.28x) Lockup Days 60.0 55.2 56.0 increased due to debt used to complete in year 3.7 51.6 acquisitions. 50.0 11.7 8.6 40.0 • Group ROE of 36.5% (Group Underlying TTM NPATA Days $22.9m / Group Equity of $62.7m) (FY24: 4
Slide 30: Debt & Liquidity
Debt & Liquidity $100.0m $90.0m 1H25 Parent Op. Bus Total Debt Cash, $2.9m Working Capital Debt $0.1 $6.5 $6.6 $80.0m Property Debt $0.0 $4.0 $4.0 $70.0m $25.8m Available Headroom, Acquisition & other term debt $18.7 $29.1 $47.8 Cash & $23.0m Gross Debt $18.8 $39.6 $58.3 Headroom $81.3m $60.0m Facil
Slide 31: Cashflow
Cashflow • Cash from Operations pre AASB 16 of $14.5m Cash from Operations (CfO) Free Cashflow to Firm (FCFF) after Debt increased by 26.7% (1H24: $11.5m) Reductions • Free Cashflow to Firm after scheduled debt reductions increased 18.5% • Cash Conversion1 of 103.0% (1H24: 101.4%) is $14.5m $8.6m $1
Slide 32: Parent & NCI Waterfall
Parent & NCI Waterfall • The profit attributable to the parent vs. NCI represent a 29%/71% split and differs from the ownership interests of ~51%/49%. 51% This is due to the following items: 49% $6,489 • Income tax expense of $1.0m of the parent entity. As the $6,197 ($1,017) majority of operating b
Slide 33: US Listing
US Listing KP+GH 33 | 1H25 results
Slide 34: US Listing: On Going Public
US Listing On Going Public @awilkinson has written a book very much worth reading #baristatobillionaire it is a great read of a Founder doing their best. As Charlie would say, there are precious ideas you need to hear in a $20 book! My favorite part is on page 17, Charlie Munger speaking: 'You guys
Slide 35: US Listing Timetable (Illustrative Only)
US Listing Timetable (Illustrative Only) Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Month 8 Month 9 Month 10 Month 11 Month 12 Preparation process • Transaction structuring and documentation First Court Scheme Second Court ASX Scheme Hearing Meeting Hearing process and structuring Schem
Slide 36: Thank You
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Slide 37: Appendix
Appendix 37 | 1H25 results
Slide 38: Trinity - Parent
Trinity - Parent 1H24 1H25 1. ROIC - 1. ROIC - Group Group 19.9% 22.2% EARNINGS PER EARNINGS PER SHARE SHARE 9.8 cps 11.0 cps +25.0% +12.2% 2. Net Debt 3. Cashflow 2. Net Debt to 3. Cashflow to EBITDA - Conversion - EBITDA - Conversion - Group Parent Group Parent 1.94x 94.8% 1.47x 100.3% 38 1H25 res
Slide 39: Trinity - OP CO
Trinity - OP CO 1H24 1H25 1. WIP 1. WIP 11.7 days* 8.6 days* CASH CASH CONVERSION CONVERSION ON EBITDA ON EBITDA 101.4% 103.0% 3. Revenue 3. Revenue 23.1% 22.8% 2. Debtors Growth 2. Debtors Growth 43.4 days* EBITDA 43.1 days* EBITDA 30.6% 28.1% Margins Margins * Calculated on estimated annualised ru
Slide 40: Revenue growth
Revenue growth Revenue growth contributions by year FY18 FY19 FY20 FY21 FY22 FY23 FY24 1H25 AVG Organic – Accounting 10.3% -6.4% 6.6% 1.5% 4.7% 2.9% 2.7% 3.7% 3.3% Organic – Complementary 2.7% 1.8% 1.4% 1.2% 1.5% 1.8% 0.3% 0.3% 1.4% Organic – Total 13.0% -4.6% 8.0% 2.7% 6.2% 4.7% 3.0% 4.0% 4.6% Acqu
Slide 41: Revenue & EPS
Revenue & EPS YOY Contrib. Revenue compounded Internal annual growth rate Organic – Accounting 3.8% 3.6% since 2006 29.8% Internal Organic - Complementary 6.4% 0.3% Earnings per share annual External growth rate since IPO to Acquired ∞ 18.9% FY24 13.0% Total 4.0% 22.8% 41 1H25 results
Slide 42: 1H/2H Skews
1H/2H Skews • Revenue seasonality in the accounting Revenue seasonality in accounting business businesses is approximately 1H: 52% / 2H: (excludes impacts of in year acquisitions) 48%, equating to a 5% (or c. $5.4m swing) 75.0% down swing in 2H24. • Seasonality is predominantly due to timing of 65.0
Slide 43: NPATA reconciliation
NPATA reconciliation Reconciliation of attributed NPAT/NPATA ($m)* 1H24 1H25 Statutory NPAT attributable owners of Kelly Partners Group Holdings Limited 1.8 2.5 Amortisation of customer relationship intangibles 1.5 1.7 NPATA attributable to owners of Kelly Partners Group Holdings Limited 3.3 4.2 Add
Slide 44: Parent & NCI
Parent & NCI • The profit attributable to the parent vs. NCI represent a 29%/71% (‘000) NCI Parent Total split and differs from the ownership interests of ~51%/49%. Group NPBT before parent entity costs $6,197 $6,489 $12,687 This is due to the following items: 49% 51% • Income tax expense of $1.0m o
Slide 45: Free Cashflow - Group
Free Cashflow - Group FY18 FY19 FY20 FY21 FY22 FY23 FY24 CAGR 1H25 Cash From Operations (CfO) $6.6 $10.0 $14.3 $15.1 $17.6 $19.5 $25.6 25.3% $17.6 Owners' Earnings (CfO - Maint. Capex) $6.3 $9.7 $12.2 $12.8 $14.0 $14.9 $19.5 20.7% $14.0 Cash Conversion (Operating Cash Flow / EBITDA) 63.5% 116.8% 97.
Slide 46: Free Cashflow ("Owner earnings")
Free Cashflow (“Owner earnings”) FY20 FY21 FY22 FY23 FY24 CAGR 1H25 Owner earnings $3.9m $5.0m $6.3m $6.0m $7.8m 19.2% $4.9m Owner earnings per share (cents) 8.55 11.11 14.03 13.33 17.44 19.5% 11.0 % Growth 24.4% 29.9% 26.3% -5.0% 30.8% 18.6% Underlying NPATA $3.9m $5.1m $6.3m $5.3m $8.0m 19.5% $4.9
Slide 47: Cash reconciliation
Cash reconciliation Reconciliation of NPAT to Operating Cashflow ($m) 1H24 1H25 Reported NPAT 7.7 9.7 Adjustments for Depreciation and amortisation 5.7 6.8 Unwinding of interest on contingent consideration 0.3 0.2 Other non-cash movements* 1.5 3.2 Change in operating assets and liabilities Decrease
Slide 48: Net debt per partner
Net debt per partner • Total number of equity partners Net Debt per Partner increased to 104 (as at 31 December 2024): $600,000 120 104 • 2 New partners promoted internally $500,000 96 100 • 9 New partners from completed acquisitions 78 • Net debt per partner consistent with prior 3 years $400,000 8
Slide 49: Dividends
Dividends • Since IPO in June 2017, the Company has consistently paid out dividends growing at >10% per annum 9.00cps >10% growth in Ordinary Dividends p.a. 8.17cps Dividend payments ceased 8.00cps for 5 years in a row in Feb 2024 • The Company has paid out monthly dividends from Jan- 7.08cps 7.00cp
Slide 50: Metrics since IPO – Full Year
Metrics since IPO – Full Year KPGHL & Controlled Entities ("Group") 1 2 3 4 5 6 7 P&L and Cashflow FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 CAGR Revenue $30.2 $39.5 $40.0 $45.5 $48.9 $64.9 $86.5 $108.1 20.0% Underlying EBITDA (pre AASB 16) $8.7 $14.5 $10.9 $13.5 $16.0 $20.0 $19.7 $30.0 19.3% Margin %
Kelly Partners Group Holdings — H1 2025 Earnings Presentation on 6ix