COL Financial Group, Inc. · PSE:COL
COL Financial — FY2016 Earnings Presentation
29 slides from COL Financial's earnings presentation, Jan 25, 2017
Slide 1: COL FY16 Investor Presentation
COL FY 16 INVESTOR PRESENTATION JANUARY 25, 206 | MONDAY T2ODPMI FEONY ROOM ee N ‘¢ Remember that the Se key to financial freedom is to SAVE, INVEST and REINVEST. * - Edward Lee Founder and Chairman
Slide 2: Highlights
Highlights Company Overview Financial & Operating Highlights Growth Plans 2
Slide 3: Company Overview
Company Overview Established and licensed by the SEC in 1999 The leading and fastest-growing online stockbroker in the Philippines Focused on tapping the underserved retail investor base in the stock market Founder (Edward K. Lee) retains a 20.7% stake and actively manages the Company
Slide 4: Ownership Structure
Ownership Structure OUTSTANDING SHARES 476.0Mil 38.1% 20.7% FREE FLOAT 181.5Mil MARKET CAP* Php7.7Bil *AS OF END DECEMBER 2016 EDWARD K. LEE ALEXANDER L. YU OTHER DIRECTORS & OFFICER PUBLIC 14.0% 27.2% 4
Slide 5: 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 5
Slide 6: Leading and Fastest Growing Online Stockbroker in the Philippines
Leading and Fastest Growing Online Stockbroker in the Philippines In Terms of Numbers of Accounts 2014 Total Accounts* % of Total Broker Name % Change Rank 2013 2014 Accounts Online 1 COL Financial 83,540 114,078 36.6% 65.3% 2 BPI Securities 25,775 33,769 31.0% 19.3% 3 First Metro 9,995 12,207 22.1%
Slide 7: Also Amongst the Biggest Philippine-Based Brokers
Also Amongst the Biggest Philippine-Based Brokers 2016 2016 Value % of Broker Name Rank Turnover (PhpBil) Total 1 CLSA Philippines, Inc. 347.90 9.0% 2 UBS Securities Philippines Inc. 337.25 8.7% 3 Deutsche Regis Partners Inc. 330.94 8.6% 4 Credit Suisse Securities (Phil), Inc. 254.27 6.6% 5 Macquari
Slide 8: Corporate Milestones
Corporate Milestones * SEC granted COL the Mutual Distributor License « Partnered with ALFM, ATRAM, First Metro, Philamlife, Philequity and Sun Life * Launched the COL Mobile App for the iOS platform « Opened the Makati Investor Center * COL's IPO for PSE listing corporate name to * Official change
Slide 9: Bulk of Revenues Generated From Philippine Operations
Bulk of Revenues Generated From Philippine Operations REVENUE BREAKDOWN 100% 0.9% OTHERS 90% COL’s Philippine operations account for 26.4% INTEREST 80% 98.8% of revenues. 70% 1.2% HK COM Commissions from both Philippines and 60% HK account for 72.6% of revenues. 22.0% PH COM- 50% AGENCY & ADVISORY I
Slide 10: Highlights
Highlights Company Overview Financial & Operating Highlights Growth Plans 10
Slide 11: Key Highlights
Key Highlights Positive Negative • Philippine business (stock • Margin lending down trading & fund distribution) grew despite challenging environment • HK business remains weak • Market share improved further, reaching a new record high • Balance sheet remained healthy • Strong growth in new account
Slide 12: FY16 Net Income
CONSOLIDATED INCOME STATEMENT (IN PHP MIL) FY16 Net Income FY15 FY16 Change +25.0% Income Amount % Commissions 486.9 605.6 118.7 24.4% FY16 net income increased by 25.0% to Interest 233.2 220.4 (12.8) -5.5% Php328.5 Mil. Excluding non-recurring tax Other income 17.0 7.8 (9.1) -53.8% expenses booked
Slide 13: Total Expenses
Total Expenses BREAKDOWN OF EXPENSES (IN PHP MIL) +5.6% Change FY15 FY16 Amount % Total expenses increased by 5.6%. Trading Related Expenses Commission expenses 83.9 92.2 8.3 9.9% The slower increase was largely due to the Stock exch. dues & fees 21.1 25.2 4.0 19.0% non-booking of one-off tax expens
Slide 14: Total Expenses
Total Expenses BREAKDOWN OF EXPENSES (IN PHP MIL) +5.6% Change FY15 FY16 Amount % Personnel costs and professional fees Trading Related Expenses increased due to the newly launched fund distribution business and higher bonuses. Commission expenses 83.9 92.2 8.3 9.9% Stock exch. dues & fees 21.1 25.2
Slide 15: Philippines Continues to Drive Growth
Philippines REVENUE BREAKDOWN (IN PHP MIL) Change Continues to Drive FY15 FY16 Amount % Growth Philippines Commission 456.8 595.5 138.8 30.4% Self-directed 295.7 412.2 116.5 39.4% Revenues from Philippine operations were Agency & advisory 161.1 183.3 22.3 13.8% up by 16.6%, largely driven by the 30.
Slide 16: Philippines Continues to Drive Growth
Philippines REVENUE BREAKDOWN (IN PHP MIL) Change Continues to Drive FY15 FY16 Amount % Growth Philippines Commission 456.8 595.5 138.8 30.4% Self-directed 295.7 412.2 116.5 39.4% Other income dropped due to the absence of Agency & advisory 161.1 183.3 22.3 13.8% trading gains resulting from clients
Slide 17: ROAE Improves to 24.0%
ROAE Improves to 24.0% SELECTED FINANCIAL INDICATORS Change FY15 FY16 Amount % Operating profits grew 21.0% to Php437.8 Operating Profits Mil, largely driven by the strength of Philippines 358.0 455.3 97.3 27.2% Philippine operations. Hong Kong 3.9 (17.5) (21.4) -542.1% Total 362.0 437.8 75.8 21.0%
Slide 18: Strong and Highly Liquid Balance Sheet
Strong and Highly Liquid Balance CONSOLIDATED BALANCE SHEET (IN PHP MIL) Sheet 12/31/15 12/31/16 Change COL remained cash rich and debt free. Amount % Total assets grew by 12.2% to Php8.9 Bil Cash & equivalents 6,749.2 7,360.5 611.3 9.1% largely driven by the 9.1% increase in cash. Receivables 1,075
Slide 19: Sustained Customer Growth
Sustained Customer Growth +26.3% CLIENT BASE 205,039 250,000 COL’s client base grew by 26.3% Y/Y to 205,039 as of end 2016. 162,330 200,000 Average monthly additions remained 112,827 strong at 3,559. 150,000 82,476 100,000 46,166 28,067 50,000 - 2011 2012 2013 2014 2015 2016 19
Slide 20: Healthy Retail Client Inflow
Healthy Retail Client Inflow + 26.4% CLIENT EQUITY 59,290 70,000 60,000 Retail 46,894 Client equity rose by 26.4% Y/Y to 43,290 Php59.3 Bil. 50,000 Net new cash flow from retail clients 32,051 40,000 amounted to Php7.4 Bil during FY16. 25,650 30,000 16,447 15,891 13,412 11,962 20,000 8,709 10,000 -
Slide 21: Margin Loans Drop
Margin Loans Drop -38.6% AVE DAILY MARGIN LOANS 1,231 1,400 1,220 Average daily margin loans were down 1,102 38.6% at Php596 Mil Y/Y. 1,200 971 As of end December, the total number 952 1,000 of approved margin accounts reached 1,129, flattish on a Y/Y basis. 800 596 Only 30.7% of approved margin 600
Slide 22: Market Share Reaches A New Record High
Market Share Reaches A New Record High COMPARATIVE PERFORMANCE (COL VS. PSE) COL’s average daily turnover rose 25.8% Change Y/Y to Php879.9 Mil during 2016 despite the 2015 2016 12.9% drop in the PSE’s average daily Amount % turnover. PSE Ave. Daily T/O 8,964.2 7,811.7 (1,152.5) -12.9% (PhpMil) COL
Slide 23: Highlights
Highlights Company Overview Financial & Operating Highlights Growth Plans 23
Slide 24: Pro Active Growth Plans
Pro Active Growth Plans Maintain leadership by focusing on our consistent, long-term strategic goals Priorities Statement Strategies Expand Client #1. Continue to be the leading asset • Set up more investor centers Acquisition gatherer in the brokerage industry • Enter into tie-ups to expand market
Slide 25: Update on Fund Distribution Business
Update on Fund Distribution Business NET SALES (IN PHPMIL, ACCORDING TO FUND TYPE) Total Total Type of Fund 1Q16 2Q16 3Q16 4Q16 % Total % Total Sales AUA* Money Market 0.6 6.9 1.6 (42.4) (33.3) -3.9% 55.4 4.3% Bond Fund 14.3 21.3 23.8 7.6 67.0 7.9% 102.5 7.9% Balanced Fund 13.8 11.7 18.3 11.5 55.4 6
Slide 26: Update on Fund Distribution Business
Update on Fund Distribution Business SIGNIFICANT SHARE OF INDUSTRY EQUITY FUND SALES (PESO FUNDS ONLY) 1Q16 2Q16 3Q16 4Q16 COL 150.9 203.6 192.9 209.9 Industry 1,181.6 (2,350.1) (2,267.5) 3,125.6 % Share 12.8% - - 6.7% SOURCE: PIFA, COL ESTIMATES 26
Slide 27: Update on Fund Distribution Business
Update on Fund Distribution Business MF INVESTORS MF Investors % of Total Clients 20,000.0 10.0% 8.9% 18,000.0 8.5% 9.0% 16,000.0 7.5% 8.0% 6.9% 14,000.0 7.0% 12,000.0 6.0% 10,000.0 4.6% 5.0% 18,317 8,000.0 3.4% 16,599 4.0% 13,690 6,000.0 11,859 3.0% 4,000.0 7,526 2.0% 2,000.0 5,244 1.0% 0.0 0.0% 3Q
Slide 28: Thank You
Thank You 28
Slide 29: 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