Aub Group Limited · ASX:AUB
Aub — Austbrokers Holdings — H1 2006 Earnings Presentation
20 slides from Aub's earnings presentation, Feb 28, 2006
Slide 1: 2006 Half Year Results
lD austbrokers AUSTBROKERS HOLDINGS LIMITED 2006 Half Year Results : Tuesday 28th February 2006
Slide 2: Agenda
lD Agenda austbrokers > Overview: - The Austbrokers Board - Business overview ~ Unique owner-driver model ~ HY Performance highlights - Detailed financial statements «HY performance and FY outlook
Slide 3: The Austbrokers Board
lD The Austbrokers Board austbrokers Chairman Richard Longes Frank Earl Non Executive Directors: David Harricks Phil Shirriff Executive Director ~ Lach McKeough (CEO)
Slide 4: Business overview
lD Business overview austbrokers ¢ Top four insurance broking network in Australia — Client base of approx 175,000 — Over 900 employees + National network servicing predominately SME market - 70% of Austbrokers’ premiums are placedin this segment
Slide 5: Business overview con't
Business overview con't austbrokers * Owner driver model — 31 member broker firms with potential to expand (reduced from 34 through consolidations) « 3 Sydney businesses merged to become 1 * 2 Adelaide businesses merged to become 1 * Underwriting agency business — Austagencies entities are authorise
Slide 6: Unique preferred owner-driver model
lD Unique preferred owner-driver model —austprokers ¢ 31 Member Firms with ability to expand « Austbrokers takes equity interest (50% or more) « The individual brokers retain the balance of the equity as Co-Owners with Austbrokers « The Co-Owners retain day-to-day management and:control of each Memb
Slide 7: HY performance highlights
lD HY performance highlights austbrokers * Profit in line with Prospectus forecasts NPAT before amortisation of intangibles for HY 2006 at $4.1 million ($7.2 million operating profit after including profits on sale of businesses and.after amortisation of intangibles) Aiming for NPAT of $10.4 million
Slide 8: HY performance highlights (cont)
lD HY performance highlights (ony austbrokers + Broking commission and fees down 3% on forecast * Expenses down 2% on forecast * Increases in other income (premium funding, life) brokers results overall in line with forecast - NPAT Earnings Per Share (excluding profits on sale of businesses) — 8.2 c
Slide 9: Agenda
lD Agenda austbrokers * Overview * Detailed financials: ~ Profit and loss statement — as per ASX reporting ~ Profit and loss statement — detailed i - Reconciliation ~ Balance. shéet = Other financials * HY performance and FY outlook
Slide 10: Profit and loss statement
lD Profit and loss statement austbrokers Half Year to 31 December (A$’000) 2005 2005 2004 Year to 30 June 2006 Actual Forecast Variance Forecast Consolidated Brokers Commission and Fees 22,275 23,047 (?72) 0,290 Interest 4,201 839 262 +821 Other Income 970 864 106 838 Revenue From Consolidated Broke
Slide 11: Profit after tax reconciliation
lD Half Year to 31 December austbrokers Profit after tax Reconciliation of reported result to operating NPAT before profits relating to divestments and amortisation of intangibles. Actual 2005 Actual 2004 $ ‘000 $ 000 Reported Profit attributable to: members . 7,245 4,287 Earnings from businessés di
Slide 12: Balance sheet
lD Balance sheet austbrokers Actual Dec 05 Actual Jun 05 Assets $000 $000 Current Assets Cash at Bank 24,185. . 16,276 Cash at Bank — Trust 25,699 | , 32,334 Receivables. : 31/443 . 49,136 Short term investments 1316 ~ 3,938 Amounts owned by ING 1,234 Held for sale 1,576 Total Current Assets a 84,44
Slide 13: Balance sheet (cont)
lD Balance sheet (cons austbrokers Actual Dec 05 Actual Jun 05 Liabilities $000 $000 Current Liabilities Payables 56,691 79,545 Tax Liabilities 2,049 2,256 Borrowings ING Australia Holdings 6,035 21,001 Provisions 2,545 2,920 Total Current Liabilities 68,226 405,722 Non current liabilities ; Provisi
Slide 14: Other Financials
lD Other Financials austbrokers Funding Market Capitalisation * Interest Bearing Liabilities * At 31 December: $120.5 million; current: $138.5 million — $12 million (part fund broker loans of $17.5 million) Dividend per share * Cash available for acquisitions.“ +5 cents Half Year — committed $5 mill
Slide 15: Agenda
Agenda * Overview * Detailed financials lD austbrokers * HY performance and FY outlook HY Performance Market conditions Strategy Highlights Outlook, 15
Slide 16: HY performance
lD HY perfo rmance austbrokers $7000 HY Forecast~ HY Actual % change Broker Revenue 56,677 65,988 - 1.2% Broker Profit (AHL sharé). 7,836 8,083 3.2% L matte a — 7 a ban _ amortisation of intangibles) _ NPAT (before amortisation og 679 : ; 4.080 10.9% of intangibles) 16
Slide 17: Market conditions
lD Market conditions austbrokers * Premium rates — Market remains soft — Less impact in the SME segment of the market than at the large corporate end — The SME market represents 70% of Austbrokers’ gross premium . Commission / fee mix remains at 65% /35% - WT
Slide 18: Strategy
lD Strategy austbrokers * Growth - acquisition * Back office synergies and efficiencies * Product development * Premium funding * Life and superannuation 18
Slide 19: Highlights
Highlights austell * Acquisitions « Back office synergies — Salisbury Payne Tinslay — 1 — Merged three Sydney October 2005 businesses (AEI, Adept, »Wilburtins) —.1.January — Traralgon Insurance Brokers (by Austbrokers Stateplan) — 1 — -Merged two Adelaide businesses November 2005 « ~.~ (Terrace, AHL
Slide 20: Outlook
lD Outlook austbrokers Market conditions unlikely to change in immediate future Austbrokers performance to remain steady — Healthy combination of fees and commissions — Continued cost savings through synergies Insurance.industry consolidation - — We continue to seek prospective acquisitions On track