Pioneer Credit Ltd · ASX:PNC
Pioneer Credit — FY2018 Earnings Presentation
21 slides from Pioneer Credit's earnings presentation, Aug 24, 2018
Slide 1: FY18 Results Presentation
24 August 2018 For personal use only FY18 Results Presentation
Slide 2: Important notice: Disclaimer
2 Important notice: Disclaimer For personal use only This presentation has been prepared by Pioneer Credit Limited (“Pioneer”). 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
Slide 3: Highlights
3 Highlights For personal use only Liquidations exceed $100m for the first time, up 44% to $101.67m $54.3m EBITDA Up 55% on prior year ‘Industry first’ forward flow for LMI residuals Issued $40m Medium Term Notes – diversifying funding and increasing tenor Commenced personal lending with $6.0m advan
Slide 4: Profit and loss
4 Profit and loss For personal use only PDP liquidations and operational excellence drive record profit FY17 FY18 Profit after tax ($m) PDP liquidations $70.7m $101.7m +44% Services & lending revenue $1.9m $2.9m +53% CAGR = 40% 17.6 Net revenue $56.3m $81.5m +45% 10.8 EBITDA $35.0m $54.3m +55% 9.5 7
Slide 5: Cash flow
5 Cash flow For personal use only PDP liquidations and operational excellence drive record cash generation FY17 FY18 EBITDA $35.0m $54.3m +55% • PDP liquidations and disciplined cost management Gross operating cash flow $36.3m $55.7m +53% drive significant growth in operating cash flow Gross operati
Slide 6: Balance sheet
6 Balance sheet For personal use only Asset base underpinned by cautious PDP valuation and personal lending growth Gearing (LVR) 70% Covenant FY17 FY18 60% Covenant Cash and cash equivalents $3.1m $3.4m +9% 50% Target Total assets $180.2m $244.8m +36% 40% Borrowings $80.4m $129.0m +61% PDPs + 30% Pe
Slide 7: Earnings growth
7 Earnings growth For personal use only Successfully built operational scale is the foundation to continued earnings growth EBITDA ($m) EPS (cps) DPS (cps) CAGR = 29% CAGR = 38% CAGR = 47% 54.3 14.33 28.88 35.0 20.36 20.77 9.80 9.50 29.7 31.2 8.55 16.40 19.5 7.97 3.10 FY14 FY15 FY16 FY17 FY18 FY14 F
Slide 8: Our culture is our difference
8 Our culture is our difference For personal use only Leadership Principles provide a framework to drive great outcomes for all stakeholders
Slide 9: Our culture is our difference: Pioneer's competitive advantage
9 Our culture is our difference For personal use only Pioneer’s competitive advantage • Inclusive and empowering Our culture Defined by an unwavering set of Leadership Principles • Embedded in values for our customers and vendors • Strict investment discipline Analytics drives selection of lower
Slide 10: Investment discipline
10 Investment discipline For personal use only Sustainable investment discipline • Continued commentary on increasing competition and prices cents per $ Annual PDP investment $m 0.20 90 o Neither noticeably impacted Pioneer 80 o Slight decrease in investment price in FY18 70 60 • Pioneer’s portfolio
Slide 11: Payment arrangement portfolio
11 Payment arrangement portfolio For personal use only Sustainable arrangements lead great customer outcomes Growth in PA book PA book metrics 21,540 customers 3.2% >30 days in arrears $231 average monthly payment June 2016 June 2017 Today 2.3 years average existing relationship $155m $215m $280m ou
Slide 12: Sustainable cash generation
12 Sustainable cash generation For personal use only Contribution from older vintages to increase in FY19 • Liquidation contribution from newer vintages in FY18 influenced Portfolio liquidations by investment date by recent material investment growth • As investment growth moderates and employee ten
Slide 13: Personal loans
13 Personal loans For personal use only Credit settings are tight in early stages and will continue for some time Personal loan customers by state Number of loans disbursed 326 Average loan disbursed $18,452 Total loans disbursed $6.0m Average term 4.9 years 1% Average interest rate 13.7% 23% Averag
Slide 14: Investment in InDebted
14 Investment in InDebted For personal use only InDebted is a rapidly growing technology business • InDebted has built a data-driven receivables platform leveraging machine learning to provide a personalised customer experience at scale and has a wide and growing customer base across Australia, New
Slide 15: FY19 outlook
15 FY19 outlook For personal use only A market of increasing opportunity for a disciplined Pioneer Personal loans • Target of $30m in loans advanced by December 2018 PDP investment and M&A guidance • PDP investment opportunities are plentiful • If material sustainable opportunities avail we will adv
Slide 16: Appendix
For personal use only Appendix
Slide 17: Corporate snapshot
17 Corporate snapshot For personal use only Significant level of Board and Management ownership Largest shareholders • Every Executive has equity and participates with senior Keith John1 (Managing Director) 9.36% management in the Equity Incentive Plan (EIP) Board and Management1 (ex Keith John) 7.5
Slide 18: Experienced Board of Directors invested in success
18 Experienced Board of Directors invested in success For personal use only Michael Smith, Chairman Managing Director of strategic marketing consultancy firm Black House. Chairman of 7-Eleven Stores, Chairman of Starbucks Australia, Chairman of Lionel Samson Sadleir Group and Board Member of Creativ
Slide 19: Experienced Executives invested in success
19 Experienced Executives invested in success For personal use only Keith John, Managing Director Founder of Pioneer with over 25 years’ experience in the financial services industry in Australia and in Asia. Leslie Crockett, Chief Financial Officer (commenced Sep 2012) A Chartered Accountant leadin
Slide 20: Glossary
20 Glossary For personal use only Tier 1 Customers not regarded as credit impaired when originated Liquidations Comprises any cash-flow source from a PDP PDP Purchased Debt Portfolio PA Payment arrangement, where a customer agrees to make payments at an agreed interest rate CIV Change in Value of PD
Slide 21: Contacts
21 Contacts For personal use only Keith R. John Leslie Crockett Sue Symmons Managing Director Chief Financial Officer Company Secretary & General Counsel P: 08 9323 5001 P: 08 9323 5008 P: 08 9323 5020 E: krjohn@pioneercredit.com.au E: lcrockett@pioneercredit.com.au E: ssymmons@pioneercredit.com.au