Slide 1: 1H22 Results Presentation
1H22 Results Presentation August 2022
Slide 2: Contents
CONTENTS S EC T IO N HEADING P AGE NO . 01 1H22 Results & Highlights 5 02 Post Balance Date Activity & FY22 Outlook 11 03 Asset Management 14 04 Lending 20 05 Corporate Advisory & Equities 25 06 1H22 Financials 28 07 Strategic Outlook 32 08 Appendices 35 2
Slide 3: Explanation of Underlying measures in this presentation
Explanation of Underlying measures in this presentation MA Financial Group Limited (MA Financial or the Company) (ACN 142 008 428) Differences in classification arise because the Company chooses to classify some and its subsidiaries (Group) utilise non-IFRS Underlying financial information in IFRS m
Slide 4: MA Financial Group at a glance
MA Financial Group at a glance Thirteen years of progress with a focus on delivering results and investing in growth A diversified financial services firm headquartered in Australia with activities in Asset 1 Management, Lending, Corporate Advisory & Equities A growth company focused on delivering a
Slide 5: 1H22 Results & Highlights
O1 1H22 Results & Highlights MA Financial Group
Slide 6: 1H22 Result Highlights
1H22 Result Highlights Diversified business model delivering strong growth despite volatile markets Record 1H Underlying EPS Strong Underlying Interim dividend Available liquidity1 revenue growth 17.6cps 6.0cps $113m ⬆ 42% on 1H21 $146m ⬆ 20% on 1H21 ⬆ 66% on 1H21 ⬆ 54% on 1H21 Assets Under Mgt Gros
Slide 7: 1H22 Results
1H22 Results UNDERLYING RESULTS1 1H22 1H21 GROWTH STATUTORY RESULTS1 1H22 1H21 GROWTH Revenue $146.2m $94.8m 54% Revenue2 $153.7m $100.8m 53% EBITDA $49.6m $30.3m 64% EBITDA3 $48.5m $31.8m 53% Net profit after tax $28.1m $17.8m 58% Net profit after tax $20.5m $14.3m 44% Earnings per share4 17.6¢ 12.
Slide 8: Financial performance
Financial performance Diversified platform delivers a record result and EPS growth over extended timeframe UNDER LYING R EVENUE ($ M ) UNDER L YING EBITDA ($ M ) 240 1H 2H 80 1H 2H 200 60 160 120 41 120 87 40 37 33 90 35 80 78 146 20 50 40 71 95 25 30 54 65 20 24 0 0 FY18 FY19 FY20 FY21 1H22 FY18 FY
Slide 9: Business unit highlights
Business unit highlights Continued momentum across all business units ASSET MANAGEMENT EBITDA contribution1 69% EBITDA CONTR IBUTION BY BUS INES S DIVIS ION (EX. COR POR ATE) 1 • Gross inflows of $574m, driven by strong flows into credit funds $m • Base management fees up 35% on 1H21 70 • Strong tra
Slide 10: 1H22 strategic outcomes
1H22 strategic outcomes Delivering on key priorities despite changing operating conditions Asset management base fee run rate at the end of 1H22 equivalent to $93m p.a., up 4% from $89m at end FY21 Grow recurring revenue base In addition, Finsure generated $7.3m of recurring service-based revenue in
Slide 11: Post Balance Date Activity & FY22 Outlook
02 Post Balance Date Activity & FY22 Outlook
Slide 12: Key business activity since June 2022
Key business activity since 30 June 2022 A positive start to 2H22 ASSET MANAGEMENT • Positive momentum in AUM and client fund flows continues − $354m of gross fund inflows received over the first seven weeks of 2H22 (net inflows: $277m) − Includes 2 new institutional credit mandates of $136m in aggr
Slide 13: FY22 outlook
FY22 outlook Guidance remains unchanged, underpinned by business diversity and underlying growth momentum FY22 Underlying EPS, excluding unrealised MTM gains, is expected to be up 30% to 40% on FY21 Using the old methodology including unrealised gains, Underlying EPS is expected to be up 10% to 20%
Slide 14: Asset Management
O03 MA Financial Group Asset Management 4
Slide 15: Asset Management Performance
Asset Management Performance UNDERLYING FINANCIALS ($M) 1H22 1H21 GROWTH Base management fees 45.7 33.8 35% Principal investments income 3.8 4.3 (12%) Includes $3m of distributions from Redcape Total recurring revenue 49.5 38.1 30% Transaction fees 9.2 5.7 61% 1H22 includes $5.6m from credit and $3.
Slide 16: Assets Under Management
Assets Under Management AUM at $7.2 billion with a focus on alternative assets and private capital markets $7.2b $6.9b 0.3 0.3 0.6 0.9 $5.4b 1.9 $4.9b 1.6 $3.7b 1.5 1.8 2.6 2.6 FY18 FY19 FY20 FY21 1H22 Real Estate Hospitality Credit Equities PE/VC 16
Slide 17: 1H22 Fund Flows
1H22 Fund Flows Investment in diversifying distribution, product and capability has delivered ongoing momentum in fund flows FLOWS BY ASSET CLASS1 ($M) 1H22 1H21 Gross Net Gross Net Net flows impacted by successful exit of Hollywood Plaza shopping centre Real Estate 46 (1) 79 63 Hospitality 44 41 52
Slide 18: Asset Management client base
Asset Management client base Domestic HNW & Retail increasing as a proportion of total AUM 1 H2 1 AUM BY INVES TOR CHANNEL 1 H2 2 AUM BY INVES TOR CHANNEL $1.2b $1.3b 17% 22% $1.8b 29% $2.6b 36% $6.1b $7.2b $3.4b $3.0b 47% 49% Institutional International HNW Domestic HNW & Retail Institutional Inter
Slide 19: Highlights
Highlights Diversity of fund strategies delivers continued AUM growth Credit Hospitality AUM: A$1.9 billion $343m (+21%) on FY21 AUM: A$1.8 billion $223m (+14%) on FY21 • Strong investor demand for credit funds in a rising interest rate environment • Hotel assets traded strongly assisted by active v
Slide 20: Lending
O A Lending MA Financial Group
Slide 21: Lending Performance
Lending Performance Incorporating Finsure related fees and commissions UNDERLYING FINANCIALS 1H22 1H21 GROWTH Net interest margin (NIM) 12.5 10.2 23% Fees & commissions Subscription fees and trail commissions 7.3 - - Upfront commissions and other fees 2.1 - - 1 Trail book value movement 3.3 - - Tota
Slide 22: Lending Key Drivers
Lending Key Drivers NIM DRIVERS 1H22 1H21 GROWTH Includes $100m from the Residential Lending acquisition in Total Loan Book $718m $375m 91% March 22 Average Invested Capital $72m $78m (8%) Change due to higher growth in lower margin, scalable Principal Lending as opposed to higher margin, bespoke Pr
Slide 23: Loan Book Growth and Invested Capital
Loan Book Growth and Invested Capital Loan book growth achieved with more efficient use of balance sheet capital LOAN BOOK GR OWTH (A$ M) INVES TED CAPITAL 1 (A$ M) 800 100 Principal Lending - USD Principal Lending - USD $93m $718m Principal Lending - AUD Principal Lending - AUD 90 Residential 700 3
Slide 24: Finsure Platform Growth
Finsure Platform Growth Finsure continues to grow its market position with a differentiated proposition for brokers focused on value-add service innovation and technology BR OKER S ON PL ATFOR M FINS UR E’S BR OKER MARKET S HARE 2 M ANAGED L OANS 2,409 $84bn +13% 13.2% +26% 2,127 11.6% $67bn 7.0% 1,
Slide 25: Corporate Advisory & Equities
05 Corporate Advisory & Equities
Slide 26: Corporate Advisory & Equities Performance
Corporate Advisory & Equities Performance UNDERLYING FINANCIALS 1H22 1H21 GROWTH Corporate Advisory fees $m 27.8 24.8 12% Equities commissions $m 2.5 3.1 (19%) Total Underlying revenue $m 30.3 27.9 9% Expenses $m 23.6 18.6 27% Underlying EBITDA $m 6.7 6.5 3% Advisory headcount avg. FTEs 58 50 16% Eq
Slide 27: Revenue Seasonality
Revenue Seasonality Corporate Advisory & Equities revenue typically weighted to second half • Corporate Advisory & Equities revenue is typically seasonal with, on average, second half weighting of approximately 60% • Typical seasonality is currently expected in FY22, subject to market conditions and
Slide 28: 1H22 Financials
O 6 1H22 Financials MA Financial Group
Slide 29: Group Underlying Profit and Loss
Group Underlying Profit and Loss SUMMARY UNDERLYING PROFIT OR LOSS STATEMENT ($M)1 1H22 1H21 GROWTH Underlying Revenue Asset Management 89.7 56.7 58% Lending 25.2 10.2 147% Corporate Advisory & Equities 30.3 27.9 9% Corporate 1.0 0.0 N.A. Total Underlying Revenue 146.2 94.8 54% Includes $8.1m impact
Slide 30: Group Operating Balance Sheet
Group Operating Balance Sheet1 OPERATING BALANCE SHEET ($M) 30 JUN 2022 31 DEC 2021 Cash and cash equivalents 73.5 237.2 Refer to detail on page 31 Loans receivable 9.7 50.5 Investments 203.9 171.3 Net trail book asset 26.8 - Increase due to acquisition of Finsure and MKM Goodwill and other intangib
Slide 31: Group Investments
Group Investments SUMMARY OF INVESTMENTS ($M) 30 JUN 2022 31 DEC 2021 Cash 73.5 237.2 Lending 76.6 92.8 Co-investments 61.0 43.4 Redcape Hotel Group 74.1 84.3 Other equity investments 1.9 1.3 Total 287.1 459.0 Highlights • Increase in Co-investments reflects the continued support to fund seed and •
Slide 32: Strategic Outlook
O / Strategic Outlook MA Financial Group
Slide 33: Leveraging deep expertise to scale business verticals
Leveraging deep expertise to scale business verticals Our strategy is to develop deep financial and operational expertise in the businesses we choose to scale The value of time and investment in capability delivers strong investment performance and AUM growth over time COM POUND ANNUAL GR OWTH IN KE
Slide 34: Well positioned for medium term growth
Well positioned for medium term growth Focus on building sustainable earnings growth 01. 02. 03. Builder of valuable businesses in Scalable business powered by Diversified capital sources and large addressable markets unique distribution client investor base 04. 05. 06. Strong balance sheet to suppo
Slide 35: Appendices
O 8 Appendices MA Financial Group
Slide 36: Appendix Financials
Appendix Financials MA Financial Group
Slide 37: 1H22 Financials - Statutory to Underlying Profit Reconciliation
1H22 Financials - Statutory to Underlying Profit Reconciliation NOTE REVENUE1 EBITDA NPAT CI1 1H22 Statutory Results ($m) 153.7 48.5 20.5 19.3 Differences in measurement Business acquisition adjustments (a) - 3.3 6.2 6.2 Net (gains)/losses on investment (c) - - - 2.0 Adjustments relating to associat
Slide 38: 1H21 Financials – Statutory to Underlying Results Reconciliation
1H21 Financials – Statutory to Underlying Results Reconciliation NOTE REVENUE1 EBITDA NPAT CI1 1H21 Statutory Results ($m) 100.8 31.8 14.3 24.6 Differences in measurement Business acquisition adjustments (a) - 2.1 4.3 4.3 Equity issued to staff (b) - (0.6) (0.6) (0.6) Net (gains)/losses on investmen
Slide 39: Notes to Statutory to Underlying Profit Reconciliation
Notes to Statutory to Underlying Profit Reconciliation Differences in Measurement Differences in Classification a) The acquisition of Armada Funds Management in 2017, RetPro in 2021 and Finsure on 7 g) The Underlying treatment records the net distributions received from the Lending Trusts in Februar
Slide 40: 1H22 Balance Sheet – Operating to Statutory Reconciliation
1H22 Balance Sheet – Operating to Statutory Reconciliation 30 JUN 2022 30 JUN 2022 30 JUN 2022 30 JUN 2022 SUMMARY CONSOLIDATED BALANCE SHEET ($M) OPERATING LENDING TRUSTS1 RECLASSIFICATIONS STATUTORY Cash and cash equivalents 73.5 46.6 - 120.1 Loans receivable 9.7 639.7 - 649.4 Investments 203.9 (2
Slide 41: FY21 Balance Sheet – Operating to Statutory Reconciliation
FY21 Balance Sheet – Operating to Statutory Reconciliation 31 DEC 2021 31 DEC 2021 31 DEC 2021 SUMMARY CONSOLIDATED BALANCE SHEET ($M) OPERATING LENDING TRUSTS1 STATUTORY Cash and cash equivalents 237.2 5.7 242.9 Loans receivable 50.5 291.9 342.4 Investments 171.3 18.9 190.2 Goodwill and other intan
Slide 42: Notes to Operating Balance Sheet Reconciliation
Notes to Operating Balance Sheet Reconciliation Lending Trust Adjustments Reclassifications • The Group utilises non-recourse funding vehicles (Lending Trusts) typically in • The reclassification adjustments seek to present the balance sheet on a net the form of securitisation trusts and bank wareho
Slide 43: Group Underlying Profit & Loss – Divisional Summary
Group Underlying Profit & Loss – Divisional Summary UNDERLYING PROFIT & LOSS 1H22 1H21 Revenue (A$m) Asset Management 89.7 56.7 Lending 25.2 10.2 Corporate Advisory and Equities 30.3 27.9 Corporate 1.0 - Total Revenue 146.2 94.8 Expenses (A$m) Asset Management 47.3 32.3 Lending 12.9 3.8 Corporate Ad
Slide 44: Borrowings - Operating
Borrowings - Operating BORROWINGS ($M) MATURITY DATE COUPON 30 JUN 2022 31 DEC 2021 MA Bond II Unsecured note 14 Sep 2022 5.85% 25.0 25.0 MA Bond IV Unsecured note 30 Sep 2024 5.75% 40.0 40.0 MACI Bond Unsecured note – limited recourse 16 May 2024 4.35% + RBA cash rate 30.0 30.0 Total Borrowings 95.
Slide 45: Appendix Assets Under Management
Appendix Assets Under Management 45
Slide 46: Real Estate AUM
Real Estate AUM Real Estate AUM maintained at $2.6 billion with acquisitions and flows offsetting realisations and capital returns $2.6b $2.6b $0.7b acquisition of $2.2b $2.2b Marion shopping centre 0.7 0.7 $0.8b acquisition of Armada Funds Management $1.5b $1.4b 1.9 1.9 $0.5b FY16 FY17 FY18 FY19 FY
Slide 47: Hospitality AUM
Hospitality AUM AUM benefited from Redcape NAV increases in 1H22, highlighting strong sector expertise across high quality real estate backed portfolios $1.8b $1.6b 0.4 Acquisition of Redcape Hotel Group ($677m) 0.3 in July 2017 $1.3b $1.2b $1.2b $0.9b 1.4 1.3 $0.1b FY16 FY17 FY18 FY19 FY20 FY21 1H2
Slide 48: Credit AUM
Credit AUM Credit AUM continues to grow strongly driven by growth in Real Estate Credit funds and Asset Backed Lending (including Priority Income Funds) $1.9b 0.1 $1.6b 0.4 0.1 0.3 $1.1b $0.9b 0.9 0.7 $0.6b $0.3b $0.3b 0.5 0.5 FY16 FY17 FY18 FY19 FY20 FY21 1H22 1 Bonds & Cash Real Estate Credit Inst
Slide 49: Listed Equities AUM
Listed Equities AUM Equities AUM impacted by market performance cycle $0.9b 0.1 0.1 $0.6b 0.1 $0.5b 0.1 $0.3b 0.6 $0.2b 0.4 $0.1b $0.1b FY16 FY17 FY18 FY19 FY20 FY21 1H22 Small Caps Fund Other Equities Funds Equity Opportunities Fund 49
Slide 50: PE/VC AUM
PE/VC AUM PE/VC successfully divested investments and returned capital to investors in 1H22 $315m $296m $285m $250m $235m $180m $65m FY16 FY17 FY18 FY19 FY20 FY21 1H22 50
Slide 51: Shares on issue
Shares on issue SUMMARY OF SHARES ON ISSUE 30 JUNE 2022 30 JUNE 2021 Total shares on issue 175,509,487 155,426,070 Less: Treasury shares 15,332,701 12,080,015 Net shares on issue 160,176,786 143,346,055 Weighted average number of shares on issue 173,169,191 153,476,542 Less: Weighted average number
Slide 52: Underlying Earnings methodology change
Underlying Earnings methodology change Removing unrealised mark to market movements (MTM) from underlying earnings Rationale Including only realised MTM valuation movements in Underlying earnings reduces volatility, provides a clearer view of underlying business momentum and aligns more closely with
Slide 53: Financial performance - Unrealised View
Financial performance - Unrealised View Strong business growth delivers record performance UNDER LYING R EVENUE ($ M ) UNDER L YING EBITDA ($ M ) 240 100 1H 2H 1H 2H 200 80 160 130 60 50 120 90 93 37 80 40 38 39 80 155 58 40 103 20 38 56 68 67 22 27 22 0 0 FY18 FY19 FY20 FY21 1H22 FY18 FY19 FY20 FY2
Slide 54: Disclaimer
Disclaimer The material in this presentation has been prepared by MA Financial Group Limited ACN 68 This presentation does not constitute an offer to sell, or a solicitation of an offer to buy, any 142 008 428 (MA Financial) and is general background information about MA Financial Group securities i