Pioneer Credit Ltd · ASX:PNC
Pioneer Credit — H1 2022 Earnings Presentation
23 slides from Pioneer Credit's earnings presentation, Feb 28, 2022
Slide 1: Primed for Growth: 1H22 Financial Results
28 February 2022 PRIMED FOR GROWTH 1H22 Financial Results Investor Presentation
Slide 2: Important notice: Disclaimer
Important notice: Disclaimer 2 This presentation has been prepared by Pioneer Credit Limited (“Pioneer” or the “Company”). Disclaimer: This presentation contains information about Pioneer’s activities current as at the date of the presentation and should not be considered to be comprehensive or to c
Slide 3: Our Culture – 'Pioneer Principles'
Our Culture – ‘Pioneer Principles’ 3 Selfless Unlimited Technical Unwavering Fearless Clear Loyalty Accessibility Competence Passion Vision Communication Put your team and Be available when Be relentless in The fire inside you, Don’t be afraid to Connect with people company first without no one else
Slide 4: Business Model
Business Model 4 Differentiated by providing high-quality, flexible financial solutions that genuinely benefit customers • Data-driven portfolio selection and performance Resilient Portfolio • Focused on product segments where customers are working to get ahead • Only market participant that does no
Slide 5: Performance
5 SECTION 1 Performance PERFORMANCE | PIONEER PORTFOLIO | OUTLOOK
Slide 6: 1H22 Performance Summary
1H22 Performance Summary 6 9% increase in half on half liquidations, increased PDP Investment, and significant upside to follow Liquidations PDP Investment Cash & Undrawn $48.6m $23.7m $39.6m 2H21: $44.7m 2H21: $14.2m 2H21: $30.4m EBITDA1 Net Assets / Equity1 Net Assets / Share2 $25.1m $58.0m 71.14c
Slide 7: 1H22 Highlights
1H22 Highlights 7 A turnaround half - Pioneer is primed for growth New debt facility at 9% Increase in half on half Performing Arrangements On track for Digital strategy and materially lower cost liquidations exceed $400m B Corp certification transformation • $200m senior finance facility • Uplift d
Slide 8: 1H22 Profit or Loss
1H22 Profit or Loss 8 1H22 Liquidations of $48.6m, up 9% half on half Profit or Loss ($’000) 2H21 1H22 • Liquidation Up 9% half of half. A significant increase driven from Liquidations revenue 44,684 48,551 o Continued improved liquidations from older vintages Other income 2,749 296 Total revenue 47
Slide 9: 1H22 Balance Sheet
1H22 Balance Sheet 9 Cautious PDP value, and clean Balance Sheet, with significant capacity, primed for growth Balance Sheet ($’000) 1H22 • PDP carrying value of $252m, up from $249m (just 1%) on $9.5m increase in investment Assets o Includes additional negative overlay for current environment of $5
Slide 10: Pioneer Portfolio
10 SECTION 2 Pioneer Portfolio PERFORMANCE | PIONEER PORTFOLIO | OUTLOOK
Slide 11: Resilient Portfolio: Increasing cash beyond investment
Resilient Portfolio: Increasing cash beyond investment 11 Continued increase in delta between cumulative liquidations and investments evidences investment discipline and operational performance; expected to continue to open further Strong returns beyond investment 55% of liquidations in 1H22 from ac
Slide 12: PDP Acquisition: Maintained disciplined approach
PDP Acquisition: Maintained disciplined approach 12 On track to for PDP investment guidance of >$41m, with 97% currently contracted, and risk to upside. PDP investment expected drive growth and profitability Focus remains on key Tier 1 banking & finance products Disciplined purchasing at attractive
Slide 13: Total Portfolio Opportunity
Total Portfolio Opportunity 13 PDP inventory/opportunity of $1.9bn, quality sourced from Australian banks; significant opportunity to deepen returns Strong portfolio with ~$1.9bn opportunity WIP Opportunity of ~$1.5bn WIP PORTFOLIO & PERFORMING ARRANGEMENTS PIONEER WIP PORTFOLIO Refer to next slide
Slide 14: Performing Arrangements Portfolio
Performing Arrangements Portfolio 14 Performing Arrangement has grown 6% in FY22, to surpass $400m. A sustainable and growing recurring income stream PERFORMING ARRANGEMENTS PORTFOLIO BALANCE ($m) PERFORMING ARRANGEMENTS PORTFOLIO OVERVIEW CAGR = 18% $400m 34.9k performing customers $377m $356m $290
Slide 15: Customer Experience: do the right thing
Customer Experience: do the right thing 15 Exceptional NPS1 driven by focusing on the best possible customer experience, validating Pioneer’s differentiated approach NPS OVERVIEW UPWARD TREND THROUGH CUSTOMER JOURNEY CUSTOMER FEEDBACK (30) +15 +29 +34 “The team went above and beyond “Very understand
Slide 16: Outlook
16 SECTION 3 Outlook PERFORMANCE | PIONEER PORTFOLIO | OUTLOOK
Slide 17: Executing our strategy: Outlook for 2H22
Executing our strategy: Outlook for 2H22 17 Well positioned to benefit from improving market conditions, with a multi-pronged strategy delivering on profitability and value generation Capitalise on PDP Focus on appropriate vendor Grow Performing Thrive under increased Realise operating leverage inve
Slide 18: FY22 Guidance
FY22 Guidance 18 Pioneer reaffirms FY22 Guidance on strong 1H22 liquidations and PDP investment contracted to 97% 1H22 FY22 Guidance Liquidations $48.6m > $105m PDP Investment $23.7m > $41m EBITDA $25.1m > $59m NPAT ($22.9m) > $1.5m
Slide 19: Appendix
19 Appendix
Slide 20: 1H22 Statutory Profit or Loss
1H22 Statutory Profit or Loss 20 Continuing operations ($’000) 2H21 1H22 • Interest income increase of 10% half on half Interest income at amortised cost 28,049 30,743 Net impairment (loss) gain on PDPs (1,552) (2,670) • Increased PDP amortisation charge ahead of time, brings in line with FY forecas
Slide 21: 1H22 Cashflow
1H22 Cashflow 21 Strong cash generation recycled in quality PDPs Cash Flows ($’000) 2H21 1H22 • Cash flow up 11% half on half driven by strong liquidations up 9% half on half Cash flows from operating activities • Payables up mostly across wages, as we invested ahead of time in capacity for growth L
Slide 22: Experienced team to execute on strategy
Experienced team to execute on strategy 22 Board of Directors Executive Leadership Michael Smith - Chairman • Managing Director of strategic marketing consultancy firm Black House Keith John - Managing Director • Chairman of 7-Eleven Stores and Starbucks Australia • Founder of Pioneer Credit • Previ
Slide 23: Thank you
23 Thank you