National Financial Partners Corp
National Financial Partners — Q1 2012 Earnings Presentation
19 slides from National Financial Partners's earnings presentation, Apr 27, 2012
Slide 1: First Quarter 2012 Earnings Call Presentation
FIRST QUARTER 2012 EARNINGS CALL PRESENTATION APRIL 27, 2012 Exhibit 99.1
Slide 2: Related to Forward-Looking Statements
Related to Forward-Looking Statements Certain items in this presentation and in today’s discussion, including matters relating to revenue, net income, Adjusted EBITDA, cash earnings, cash earnings per diluted share and percentages or calculations using these measures, acquisitions, capital structure
Slide 3: Related to Non-GAAP Financial Information
Related to Non-GAAP Financial Information The Company analyzes its performance using historical and forward-looking non-GAAP financial measures called cash earnings, cash earnings per diluted share, Adjusted EBITDA, and percentages or calculations using these measures. The Company believes these non
Slide 4: Reconciliation: Net Income to Cash Earnings
Reconciliation: Net Income to Cash Earnings (1) Cash earnings is a non-GAAP financial measure, which the Company defines as net income excluding amortization of intangibles, depreciation, the after-tax impact of the impairment of goodwill and intangible assets, the after-tax impact of non-cash inter
Slide 5: Reconciliation: Net Income to Adjusted EBITDA
Corporate Individual Advisor Client Group Client Group Services Group Consolidated Reconciliation: Net Income to Adjusted EBITDA (1) Adjusted EBITDA is a non-GAAP financial measure, which the Company defines as net income excluding income tax expense, interest income, interest expense, gain on early
Slide 6: Benefits, Insurance, Wealth Management
"Benefits Insurance Wealth Management
Slide 7: 1Q12 Highlights
1Q12 Highlights Revenue $254.1 million Revenue growth +8.9% Organic revenue growth +5.9% – Corporate Client Group +8.4% – Individual Client Group +5.3% – Advisor Services Group +2.5% Growth from acquisitions Corporate Services NY P&C sub-acquisitions Adjusted EBITDA grew 33.7%; margin expansion Reit
Slide 8: 2012 Balanced Capital Allocation Strategy
2012 Balanced Capital Allocation Strategy Strategic acquisitions of $80 million Includes approximately $20 million for management contract buyouts Recurring revenue businesses New share repurchase authorization - $50 million Intend to begin in May 2012, subject to market and other conditions Reinves
Slide 9: Quarter-over-Quarter and Year-over-Year Recurring Revenue
Quarter-over-Quarter Recurring Revenue Year-over-Year Recurring Revenue Recurring Revenue Recurring revenue includes revenue from corporate and executive benefits, property & casualty, wealth management and asset-based fees and trails. Previously reported as 57.0% and 61.0% for FY10 and 1Q10, respec
Slide 10: Benefits, Insurance, Wealth Management
"Benefits Insurance Wealth Management
Slide 11: Business Segments: 1Q12 Revenue $254.1 million
$80.6 31.7% 44.1% $112.1 1Q12 Revenue $254.1 million Business Segments Advisor Services Group Individual Client Group Corporate Client Group ($ in millions) Organic revenue growth +5.9% – Corporate Client Group +8.4% – Individual Client Group +5.3% – Advisor Services Group +2.5% $61.4 24.2%
Slide 12: Corporate Client Group
76.9% 13.2% 44.1% 27.3% 52.1% Corporate Client Group Business Segment 1Q12 Overview & Components of Revenue % of CCG Revenue 9.9% Steady and recurring business Diversification of products and services Health & Welfare – Health care reform Retirement NFP Executive Benefits P&C Strategic acquisition p
Slide 13: Individual Client Group
27.3% 52.1% Individual Client Group 31.7% 27.3% 52.1% Business Segment 1Q12 Overview & Components of Revenue Retail Life Marketing Organization & Wholesale Life Brokerage Wealth Management % of ICG Revenue 20.6% Life insurance Challenges and uncertainty remain in the market Wealth management Solid p
Slide 14: Advisor Services Group
27.3% 52.1% Advisor Services Group 62.8% Business Segment 1Q12 Overview & Components of Revenue Asset Based Fees & Trails Commissions & Non-Recurring Fees % of ASG Revenue 37.2% 24.2% Business drivers New assets Advisor recruitment Asset-based fees AUM $10.1 billion, up 4.7% vs 4Q11 1Q 2012 organic
Slide 15: Benefits, Insurance, Wealth Management
"Benefits Insurance Wealth Management
Slide 16: 1Q12 Consolidated Financial Highlights
Adjusted EBITDA Margin 1Q11 1Q12 Revenue Adjusted EBITDA & Margin Adjusted EBITDA growth +33.7% and margin expansion $95.5 $112.1 $77.8 $80.6 $18.0 $24.5 $3.3 $4.7 1Q12 Consolidated Financial Highlights ($ in millions) 63.0% 65.8% Recurring Revenue Individual Client Group Corporate Client Group Advi
Slide 17: Total Compensation Ratio by Segment
Corporate Client Group Individual Client Group (Compensation Expense, Employees )+(Fees to Principals) Revenue Total Compensation Ratio = Total Compensation Ratio by Segment 49.7% 47.8% 48.6% 50.2% 50.0% 49.2% 49.0% 51.2% 46.0% 48.0% 50.0% 52.0% 54.0% Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 54.0% 52.3% 51.7%
Slide 18: Quarterly/Annual Operating Cash Flow
Quarterly/Annual Operating Cash Flow Q1’12 Impacted by Principal Incentive Payment of $7.3 million Operating Cash Flow (1) Sum of the quarters may not agree to the full year total due to rounding. ($ in millions) -$2 $34 $50 $41 $124 $5 $37 $34 $43 $119 -$6 $40 $46 $36 $116 -$15 Q1'09 Q2'09 Q3'09 Q4
Slide 19: 2012 Balanced Capital Allocation
2012 Balanced Capital Allocation Balanced approach to capital allocation; maintain financial flexibility 1Q12 strategic acquisitions and sub-acquisitions: – Investment of $27 million cash consideration in acquisitions – Management contract buy-outs of $3 million (in P&L) Reinvestment in existing bus
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