Australian Unity Ltd · ASX:AYUPA
Australian Unity — Investor Presentation (June 2024)
38 slides from Australian Unity's investor presentation, Jun 3, 2024
Slide 1: ASX Announcement
ASX Announcement 3 June 2024 Equity Raising Investor Presentation Please find attached Australian Unity Limited’s Equity Raising Investor Presentation. -end- This announcement has been authorised for release by the Board of Australian Unity Limited. For further information: Penny Bold Senior Manager
Slide 2: Equity raising investor presentation
Equity raising Investor presentation 3 June 2024
Slide 3: Important notice and disclaimer
Important notice and disclaimer • The information contained in this presentation (“Information”) dated 3 June 2024 has been prepared by Australian Unity Limited ABN 23 087 648 888 (“Company” or “Australian Unity”) in connection with a proposed pro rata non-renounceable entitlement offer (“Entitlemen
Slide 4: Important notice and disclaimer
Important notice and disclaimer • The entitlement offer booklet for the Offer will be available following its lodgement with ASX. Any eligible MCI holder in Australia or New Zealand who wishes to participate in the Offer should consider the entitlement offer booklet before deciding whether to apply
Slide 5: Important notice and disclaimer
Important notice and disclaimer • By attending a presentation or briefing or accepting, accessing or reviewing this presentation, you acknowledge and agree that (a) you understand the contents of this notice and that you agree to abide by its terms and conditions; and (b) the Company and the Limited
Slide 6: Contents
Contents Page Executive summary 6 Transformation agenda 7 FY24 trading update and outlook 13 Pro forma financial information 18 Equity raising details 21 Appendices Appendix A: FY24 Trading update supplement 25 Appendix B: Key risks 27 Appendix C: Offer restrictions 36 Equity raising investor presen
Slide 7: Executive summary
Executive summary Equity raising • Non-underwritten 1 for 3 pro rata non-renounceable entitlement offer (Entitlement Offer), and accompanying placement to wholesale investors targeting proceeds of approximately $50m (Placement) of Australian Unity mutual capital instruments (MCIs) (together, the Equ
Slide 8: Transformation agenda
Transformation agenda Equity raising investor presentation 7
Slide 9: Australian Unity overview
Australian Unity overview Our purpose Organisational pillars To positively impact the wellbeing Providing health, wealth and care products and services that deliver of millions real wellbeing. Australian Unity focuses on opportunities that deliver relevance, diversification and growth across four or
Slide 10: Transformation objectives
Transformation objectives Australian Unity is transforming to enable real wellbeing for members, customers and community through a portfolio of commercial, sustainable businesses Key transformation agenda objectives 1 Maximise CSV contributions over the long term - Optimise portfolio to achieve stra
Slide 11: Transformation agenda - stages of implementation
Transformation agenda - stages of implementation Transformation commenced in FY23 and will continue to progress through to FY26 Transformation process Pre FY23 Current state Aspiration • 180+ year history of delivering • Targeted investment to accelerate • Portfolio of commercially products and serv
Slide 12: Transformation agenda - FY24 progress
Transformation agenda - FY24 progress A year of significant change, with material strategic investment and portfolio optimisation Strategic programs Portfolio and investment optimisation • Continued to reorganise and optimise business platforms (Home Health, Wealth & • Accelerated key portfolio oppo
Slide 13: Transformation agenda – FY25 onwards
Transformation agenda – FY25 onwards Transformation to continue with the following key areas of execution focus • Integrate myHomecare business into the newly transformed Home Health operating model Integrate and optimise recent acquisitions • Integrate IOOF into Life & Super business as part of ove
Slide 14: FY24 trading update and outlook
FY24 trading update and outlook Equity raising investor presentation 13
Slide 15: FY24 trading update
FY24 trading update A range of items including acquisition, divestment and transformation related costs are expected to materially impact earnings in FY24 while strengthening the quality and diversification of earnings into the future1 • Underlying business performance sound, with positive growth fr
Slide 16: FY24 trading update: Adjusted EBITDA bridge
FY24 trading update $m Anticipated change in Adjusted EBITDA from FY23 to FY241 180 162 160 140 120 ( 82 ) +/- 10% 2 reflecting 100 16 earnings Includes $71.0m DCL release 14 ( 47 ) exposure 80 63 60 40 20 - FY23 Adjusted Health Insurance Non-recurring Acquisitions and Transformation FY24 Adjusted E
Slide 17: Outlook
Outlook Transformation supports earnings substantially recovering to FY23 levels in FY25 On a run-rate basis, FY25 earnings planned to substantially recover to FY23 levels, inclusive of ongoing transformation, with further planned improvements in FY26 Adjusted EBITDA1 162 Expected future earnings gr
Slide 18: Community & Social Value (CSV)
Community & Social Value (CSV) FY23 CSV of $1.76b Transformation to support substantial acceleration of CSV from FY25 onwards FY24 CSV will be influenced by transformation: $317m • Significant uplift in Lifelong Wellness and Strong Communities from Supporting living in place acquisition of myHomecar
Slide 19: Pro forma financial information
Pro forma financial information Equity raising investor presentation 18
Slide 20: Pro forma balance sheet
Pro forma balance sheet Consolidated balance sheet As at 31 MHC Dividends Equity Pro forma The pro forma consolidated balance shows the impact of the ($’M) December Acquisition3 Declared Raising4 combined Offer on the 31 December 2023 balance sheet 20231,2 and Paid The following adjustments have bee
Slide 21: Pro forma gearing
Pro forma gearing Covenant gearing ratio • Following the Equity Raise, Australian Unity’s FY24 60% 900 gearing ratio is expected to increase from 30.0 percent at 800 50% 31 December 2023 to 33.4 percent on a pro forma basis 700 Debt Capacity ($m) 40% 600 Gearing Ratio adjusting for myHomecare acquis
Slide 22: Equity raising details
Equity raising details Equity raising investor presentation 21
Slide 23: Equity Raising details
Equity Raising details Offer structure and size ▪ Non-underwritten Equity Raising aiming to raise approximately $75 million,1 with the ability to raise more or less, comprising: - a 1 for 3 pro-rata non-renounceable entitlement offer to raise gross proceeds of up to approximately $83 million (Entitl
Slide 24: Equity Raising timetable
Equity Raising timetable Events Dates Announcement of Entitlement Offer, Placement and trading halt Monday, 3 June 2024 Placement bookbuild Monday, 3 June – Tuesday, 4 June 2024 Announcement of results of Placement and MCIs recommence trading Wednesday, 5 June 2024 Entitlement Offer Record Date (7.0
Slide 25: Appendices
Appendices Equity raising investor presentation 24
Slide 26: A. FY24 trading update supplement
A. FY24 trading update supplement FY24 platform highlights Home Health Residential Aged Care Retail Wealth & Capital Markets • Acquired myHomecare business for • Completed strategic review of Residential Health Insurance • IOOF acquired in October 2023 $285 million1, with total integration Aged Care
Slide 27: A. FY24 trading update supplement
A. FY24 trading update supplement Expected net movement of key material items between FY23 and FY24 Adjusted EBITDA1 ($m) Health Insurance (82.0) Non-recurring release of DCL in FY23 (71.0) Incremental health insurance premium givebacks in FY24 (16.6) Underwriting profit improvement in FY24 5.6 Non-
Slide 28: B. Key risks
B. Key risks This Appendix B includes some of the key risks associated with any investment in Australian Unity. Australian Unity is subject to a variety of risk factors. Some of these are specific to its business activities, some of these are associated with Australian Unity MCIs specifically while
Slide 29: B. Key risks
B. Key risks Business risks (cont.) Risk Risk description Deteriorating economic conditions ▪ The increasing risks associated with deteriorating economic conditions including potential recession, enduring inflation and increased operating costs, and a tightened fiscal environment could result in res
Slide 30: B. Key risks
B. Key risks Business risks (cont.) Risk Risk description Liquidity demands ▪ There is a risk that Australian Unity’s liquidity and funding plans fail to operate effectively, or there may be factors outside Australian Unity’s control which could adversely affect these plans. Australian Unity’s liqui
Slide 31: B. Key risks
B. Key risks Risks associated with Australian Unity MCIs specifically1 Risk Risk description Perpetual instruments with no set ▪ Australian Unity MCIs are perpetual instruments and have no set maturity date. Holders are unable to request or require Repurchase of Australian Unity MCIs. As a maturity
Slide 32: B. Key risks
B. Key risks Risks associated with Australian Unity MCIs specifically1 (cont.) Risk Risk description Ability to pay Dividends on Australian ▪ The ability of Australian Unity to pay Dividends is dependent on its financial performance. Australian Unity’s ability to pay a fully or partly-franked Divide
Slide 33: B. Key risks
B. Key risks Risks associated with Australian Unity MCIs specifically1 (cont.) Risk Risk description Tax consequences for Holders ▪ Holders should be aware that future changes in Australian taxation law, including changes in interpretation or application of the law by the courts or taxation authorit
Slide 34: B. Key risks
B. Key risks Risks associated with Australian Unity MCIs specifically1 (cont.) Risk Risk description Limited impact of voting rights ▪ Reflecting Australian Unity’s status as a mutual entity the Constitution enshrines a limit of one vote per member for any member of Australian Unity. This approach w
Slide 35: B. Key risks
B. Key risks General risks Risk Risk description Market risks ▪ Market risk is the risk of an adverse event in the financial markets that may result in a loss of earnings for Australian Unity and the Australian Unity Group. ▪ Market risk includes exposures to liquidity or funding risk (that is, bein
Slide 36: B. Key risks
B. Key risks General risks (cont.) Risk Risk description Reputational risk ▪ Issues of a varying nature may emerge that would give rise to reputational risk and cause harm to the Australian Unity Group’s business dealings and prospects. These issues include appropriately dealing with potential confl
Slide 37: C. Offer restrictions
C. Offer restrictions Offer restrictions This presentation has not been registered, filed with or approved by any New Zealand regulatory authority under the Financial Markets Conduct Act 2013 (“FMC Act”). The New MCIs may only be offered or sold in New Zealand (or allotted with a view to being offer
Slide 38: Real Wellbeing
Australian] Real Wellbeing