Col Financial Group, Inc. · PSE:COL
Col Financial — 9M 2023 Earnings Presentation
27 slides from Col Financial's earnings presentation, 2023
Slide 1: 9M23 COL Investor Presentation
9M23 COL Investor Presentation 1
Slide 2: Company Overview
Company Overview Established and The leading online licensed by the SEC in stockbroker in the 1999 Philippines Focused on tapping Founder (Edward K. Lee) the underserved retail retains a 21.7% stake investor base in the and actively manages stock market the Company 2
Slide 3: Outstanding shares, free float and market cap
4.76 Bil 21.7 Outstanding Shares % Edward K. Lee Free Float 1.18 Bil 24.7% Market Cap* Php14.04 Bil Public *As of end September 2023 15.5% Daiwa Securities Group 24.3% Other Directors & Officer 13.8% Alexander C. Yu 3
Slide 4: Business Objective
Business Objective To be the preferred source of financial services, a trusted provider of guidance and investment and a strong organization committed to delivering great value to its customers. Our goal is to be Champion of the Filipino Investor 4
Slide 5: COL Milestones
COL Milestones 1999 2000-2001 2006 2008 2010 Licensed by the SEC Began operating the Listed in the PSE at Launched the COL Launched the full- to conduct business COL PH online Php0.136/sh Easy Investment service agency and as a broker and trading platform Program (EIP) advisory team called seller of
Slide 6: COL Milestones
COL Milestones 2012 2014 2015 2017 2021 2022 70% owned Officially Granted a Launched COL Japan’s Daiwa Started COL changed Mutual Fund Fund Source - Securities Group, distributing Investment corporate name Distributor the first fund Inc. acquired a Feeder Funds Management to COL Financial License by
Slide 7: Among the Biggest Philippine Based Stockbrokers
Among the Biggest Philippine Based Stockbrokers 9M23 Rank Broker Name 9M23 Value Turnover (Php Bil) % of Total 1 UBS Securities Philippines Inc 216.4 8.9 2 BPI Securities Corp 166.3 6.9 3 CLSA Philippines Inc 158.3 6.5 4 BDO Securities Corp 128.6 5.3 5 Maybank Securities, Inc 120.2 5.0 6 First Metro
Slide 8: The Biggest Philippine Based Stockbroker
The Biggest Philippine Based Stockbroker Total Accounts (as of 2022) Total Online Accounts (as of 2022) 71% 29 % 60% 40% Others Others COL COL Source: PSE 8
Slide 9: Bulk of Revenues Generated from Commissions and Interest
Revenue Breakdown 9M23 1.8% Trail Fees 2.0% Others Bulk of Revenues Generated from Commissions and Interest 55.3% Interest Commissions accounted for 41.0% of revenues. Interest income from margin loans and cash placements accounted for 55.3% of revenues. 41.0% Trailer fees from the distribution of m
Slide 10: Key Operating Highlights
Key Operating Highlights Positives Negatives 1. Net income jumped 94.9%, already above 2022 full year total 1. Commission revenues fell sharply 2. Higher interest income offset lower commission 2. Rank and market share in the PSE revenues slipped 3. Commission revenues up Q/Q 3. Net new cash inflow
Slide 11: 9M23 Net Income +94.9% Y/Y
Pro Forma Consolidated Income Statement (Php Mil) Change 9M23 Net Income Income 9M22 9M23 Amount % +94.9% Y/Y Commissions 367.7 270.7 (97.0) -26.4% Interest 196.9 521.2 324.3 164.7% 9M23 net income jumped 94.9% to Php404.4 Mil as Trailer Fees 16.8 16.5 (0.3) -1.6% higher interest income offset lower
Slide 12: Commissions Hurt by Weak Investor Interest
Pro Forma Revenue Breakdown (Php Mil) Commissions Hurt by Change Weak Investor Interest 9M22 9M23 Amount % Revenue Breakdown Revenues grew 39.8% despite lower commissions due to Commission 367.7 270.7 (97.0) -26.4% higher interest income. PH-Self-directed 299.6 208.4 (91.2) -30.4% PH- Agency & advis
Slide 13: 3Q23 Net Income +86.4% Y/Y
Pro Forma Consolidated Income Statement (Php Mil) Change 3Q23 Net Income Income 3Q22 3Q23 Amount % +86.4% Y/Y Commissions 102.1 78.0 (24.1) -23.6% Interest 86.3 169.8 83.4 96.7% 3Q23 net income jumped 86.4% to Php128.1 Mil as Trailer Fees 5.4 5.5 0.1 1.0% higher interest income offset lower commissi
Slide 14: Controlled Growth of Expenses
Pro Forma Breakdown of Expenses (Php Mil) Change Controlled Growth of 9M22 9M23 Amount % Trading Related Expenses Expenses Commission expenses 22.6 19.5 -3.1 -13.9% Stock exch. dues & fees 18.6 16.3 -2.3 -12.4% Operating expenses were up single digit despite Total 41.2 35.8 -5.4 -13.2% higher fixed
Slide 15: ROAE Improved to 26.0%
ROAE Improved to 26.0% Selected Financial Ratios Annualized ROAE improved from 13.7% to 26.0%. 9M22 9M23 Profitability improved as revenues increased, leading to higher margins and asset turnover. Operating Profit Margin 46.8% 62.3% EBITDA Margin 53.7% 66.8% Margins improved as growth in revenues ou
Slide 16: Rank Slips to Number 10
Comparative Performance (COL vs. PSE) Change Rank Slips to Number 10 9M22 9M23 Amount % COL’s average daily turnover fell 27.9% to Php526.2 PSE Ave. Daily T/O (PhpMil) 7,158.5 6,563.3 (595.2) -8.3% Mil. This was steeper than the PSE’s 8.3% decline as value turnover of local investors fell by 32.5% Y
Slide 17: Strong Balance Sheet
Strong Balance Sheet Pro Forma Consolidated Balance Sheet (Php Mil) Change 12/31/22 9/30/23 Amount % Cash & cash equivalents fell slightly by 6.4% to Php9.9 Bil. This was largely due to the payment of cash dividends and the decline in customers’ excess Cash & cash equivalents 10,524.3 11,896.9 1,372
Slide 18: Customer Base Up Y/Y
Client Base +3.8% Customer Base Up Y/Y 517,593 503,145 498,625 489,154 437,048 COL’s client base grew by 3.8% Y/Y to 517,593 as of end September 2023. 332,098 292,401 Average monthly additions reached 1,581 during the past 12 months and 1,385 during the quarter. During the third quarter, average mon
Slide 19: Client Equity Up on Higher Asset Values
Client Equity (Php Mil) +12.9% Client Equity Up on 107,346 112,556 109,011 104,782 Higher Asset Values 96,580 Client equity was up 12.9% Y/Y to Php109.0 Bil 72,673 72,398 as of end September 2023. Client equity increased largely due to higher asset values. As of end September, the PSEi index was up
Slide 20: Margin Loans Up
Ave Daily Margin Loans (Php Mil) +25.9% Margin Loans Up 966 Average daily margin loans increased by 25.9% 759 752 719 to Php966 Mil Y/Y. 617 536 518 2018 2019 2020 2021 2022 9M22 9M23 20
Slide 21: MF Net Sales still Positive due to Bond and Feeder Funds
MF Net Sales still Positive MF Net Sales (Acc to Fund Type) due to Bond and Feeder 200.0 Funds 150.0 100.0 COL’s MF distribution business still generated net sales of Php102.1 Mil during 9M23 despite the 50.0 Php Mil challenging operating environment. This was due to the popularity of bond funds, an
Slide 22: COL Accounted for 3.7% of Industry Equity Fund Sales
2021 Net Sales (in Php Mil, Acc to Type of Fund) Net Sales Industry COL % Share COL Accounted for Money Market 50,773.2 -10.5 0.0% 3.7% of Bond -1,543.0 -11.6 0.8% Industry Equity Balanced -397.1 15.6 -3.9% Fund Sales Equity fund 4,820.3 178.6 3.7% Feeder fund* 4,804.3 75.2 1.6% Total 58,457.6 247.4
Slide 23: Average AUA Continued to Recover
Average AUA (Non-Money Market Funds Only, in Php Mil) Average AUA Continued 3,997.8 3,936.6 3,921.3 to Recover 3,874.3 3,865.9 3,778.3 3,742.6 Average non-money market AUA increased during 3Q23. However, trail 3,604.4 fees were flattish as the increase in AUA 3,529.5 3,483.6 was not enough to offset
Slide 24: Clients Owning MFs Slipped
Clients Owning MFs Slipped MF Investors % of Total Clients 65,000 13.4% 13.1% 13.2% 13.0% 64,000 13.0% 12.9% 12.8% 12.8% 13.0% 63,000 12.7% 12.7% 12.8% 12.6% 62,000 64,582 12.6% 64,490 64,296 64,058 63,870 63,725 61,000 12.4% 62,273 12.5% 60,000 61,489 12.3% 61,044 12.2% 60,866 60,418 59,000 12.0% 5
Slide 25: MF only Clients Flat
MF Only Clients 18,000 MF only Clients Flat 16,000 14,000 The number of clients who only owned MFs was 12,000 flat. 10,000 As of end September, there were 16,071 clients who only owned MFs, almost flat on a Y/Y and 8,000 Q/Q basis. 6,000 Of the said number, 11,385 or 70.8% were Starter clients while
Slide 26: Growing Number, but Lower Percentage of Clients Own MFs
26 10,000.0 20,000.0 30,000.0 40,000.0 50,000.0 60,000.0 70,000.0 0.0 SOURCE: COL ESTIMATES 5,244 3.4% 7,526 4.6% 11,859 6.9% 13,690 7.5% 16,599 8.5% 18,317 8.9% 20,493 9.5% 22,257 9.9% 24,739 10.4% 27,375 11.1% MF Investors 30,421 11.6% 32,675 12.0% 34,847 12.3% 36,349 12.4% 38,069 12.5% % of Total
Slide 27: Disclaimer
Disclaimer This presentation was prepared solely and exclusively for discussion purposes. This presentation and/or any part thereof may not be reproduced, disclosed or used without the prior written consent of COL Financial (the “Company”). This presentation, as well as discussions arising therefrom