Iress Limited · ASX:IRE

Iress — FY2012 Earnings Presentation

55 slides from Iress's earnings presentation, Feb 20, 2013

  1. Slide 1: ASX cover letter: IRESS 2012 Full Year Results

    20 February 2013 For personal use only The Manager Company Announcements Office Australian Stock Exchange Exchange Centre 20 Bridge Street SYDNEY NSW 2000 ELECTRONIC LODGEMENT Dear Sir or Madam IRESS 2012 Full Year Results – Presentation Please find attached a presentation relating to the company’s

  2. Slide 2: Full Year Results - December 2012

    Presentation Title| Subtitle (change on master slide) FULL YEAR RESULTS – DECEMBER 2012 For personal use only FULL YEAR RESULTS - DECEMBER 2012

  3. Slide 3: IRESS 2012 Results

    Presentation Title| Subtitle (change on master slide) IRESS 2012 RESULTS FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Group revenue (before investments) up 1% on 2011. • Stable revenue • Resilient result in light of conditions. • Appreciation of AUD negatively impacted South African con

  4. Slide 4: Segment Performance Against Prior Half: Financial Markets

    Presentation Title| Subtitle (change on master slide) SEGMENT PERFORMANCE AGAINST PRIOR HALF FULL YEAR RESULTS – DECEMBER 2012 FINANCIAL MARKETS For personal use only • Aust & NZ • South Africa(ZAR) • Op Rev down 0.6% (down 0.2% on PY) • Op Rev up 7.8% (up 16.4% on PY) • Seg Profit no change (down 3

  5. Slide 5: Segment Performance Against Prior Half: Wealth Management

    Presentation Title| Subtitle (change on master slide) SEGMENT PERFORMANCE AGAINST PRIOR HALF FULL YEAR RESULTS – DECEMBER 2012 WEALTH MANAGEMENT For personal use only • Aust & NZ • South Africa (ZAR) • Op Rev up 6.6% (up 9.7% on PY) • Op Rev down 7.0% (up 5.6% on PY) • Seg Profit up 1.3% (up 15.2% o

  6. Slide 6: Group Performance Against Prior Year

    Presentation Title| Subtitle (change on master slide) GROUP PERFORMANCE AGAINST PRIOR YEAR FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Underlying Group Profit $54.383 m Down $5.405 m, down 9.0% on prior half • Segment Contribution against prior year $A • Financial Markets Aust/NZ (2.47

  7. Slide 7: Group Segment Profit Margins

    Presentation Title| Subtitle (change on master slide) GROUP SEGMENT PROFIT MARGINS FULL YEAR RESULTS – DECEMBER 2012 For personal use only Segment Profit Margin: % Revenue per Media Release H1 2011 H2 2011 H1 2012 H2 2012 2009 2010 2011 2012 Aust 52.7% 50.6% 49.7% 50.0% 57.2% 56.3% 51.7% 49.9% Fin M

  8. Slide 8: Strategic Charges, Non-Recurring Expenses and Tax

    Presentation Title| Subtitle (change on master slide) FULL YEAR RESULTS – DECEMBER 2012 For personal use only STRATEGIC CHARGES NON-RECURRING EXPENSES • $12.692 for year (2011:$17.827m) Net non-recurring expenses before tax of •Change primarily from the Visiplan ($0.261)m, includes: software becomin

  9. Slide 9: Group Recurring Subscription Revenue

    Presentation Title| Subtitle (change on master slide) GROUP RECURRING SUBSCRIPTION REVENUE* FULL YEAR RESULTS – DECEMBER 2012 For personal use only Peresys Acquisition 80 60 $A Millions 40 20 - H1'07 H1'08 H1'09 H1'10 H1'11 H1'12 Aust - Fin Mkts Aust - Wlth Mgt Can South Africa ASIA UK 8 * Excludes

  10. Slide 10: Group Segment Profit

    Presentation Title| Subtitle (change on master slide) GROUP SEGMENT PROFIT * FULL YEAR RESULTS – DECEMBER 2012 For personal use only Peresys 50 Acquisition 40 30 $A Millions 20 10 - H1'07 H1'08 H1'09 H1'10 H1'11 H1'12 -10 Aust - Fin Mkts Aust - Wlth Mgt Can South Africa ASIA UK * Definition of Segme

  11. Slide 11: Relative Impact H2'12

    Presentation Title| Subtitle (change on master slide) RELATIVE IMPACT H2’12 FULL YEAR RESULTS – DECEMBER 2012 For personal use only 100% 80% 60% 40% 20% 0% Revenue (Recurring Segment Prof it* Total Direct Staf f Total Strategic Subs) Costs Charges -20% Aust - Fin Mkts Aust - Wlth Mgt Can South Af ri

  12. Slide 12: Operating Cashflow per Share

    Presentation Title| Subtitle (change on master slide) OPERATING CASHFLOW PER SHARE* FULL YEAR RESULTS – DECEMBER 2012 For personal use only $0.70 40% $0.60 35% $0.50 Effective Tax Rate cents per share $0.40 30% $0.30 $0.20 25% $0.10 $0.00 20% 2003 2005 2007 2009 2011 H1 H2 Effective Tax Rate (RHS) *

  13. Slide 13: IRESS Group Outlook

    Presentation Title| Subtitle (change on master slide) IRESS GROUP OUTLOOK FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Trading 2012 • Conditions for client base sustained by low-volumes and regulatory change. • Headcount decline and service consolidation key themes. • Revenue growth fro

  14. Slide 14: Australia & New Zealand

    Presentation Title| Subtitle (change on master slide) FULL YEAR RESULTS – DECEMBER 2012 For personal use only HALF YEAR RESULTS - JUNE 2012 AUSTRALIA & NEW ZEALAND

  15. Slide 15: Financial Markets

    Presentation Title| Subtitle (change on master slide) FINANCIAL MARKETS FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Reduced H2 2012 result from flatter revenue: • Revenue decreased 0.6% on H1 2012 (down 1.3% pcp) • Segment Profit equals H1 2012 (down 2.5% pcp) • Revenue profile reflect

  16. Slide 16: Financial Markets - 2012

    Presentation Title| Subtitle (change on master slide) FINANCIAL MARKETS - 2012 FULL YEAR RESULTS – DECEMBER 2012 For personal use only • March deadline for best execution compliance has maintained steady flow of interest in implementation or IRESS Trade-through Analysis (TTA). • OTW multi-market tra

  17. Slide 17: Daily Trades on the ASX

    Presentation Title| Subtitle (change on master slide) DAILY TRADES ON THE ASX FULL YEAR RESULTS – DECEMBER 2012 For personal use only 700 600 500 400 300 200 100 0 Jul-06 Jan-07 Jul-07 Jan-08 Jul-08 Jan-09 Jul-09 Jan-10 Jul-10 Jan-11 Jul-11 Jan-12 Jul-12 Jan-13 Number of Trades Value of Trades 16

  18. Slide 18: Market Fragmentation – Canada & Australia: Message Rates

    Presentation Title| Subtitle (change on master slide) MARKET FRAGMENTATION – CANADA & AUSTRALIA FULL YEAR RESULTS – DECEMBER 2012 COMPARATIVE MESSAGE RATES (PER TRADE PER DESTINATION) For personal use only 180 Number of Messages per Trade 158 120 112 105 99 91 76 60 47 26 18 21 11 9 0 TSX CHI-X ALPH

  19. Slide 19: Market Fragmentation – Canada & Australia: Market Share

    Presentation Title| Subtitle (change on master slide) MARKET FRAGMENTATION – CANADA & AUSTRALIA FULL YEAR RESULTS – DECEMBER 2012 NON-TSX % VALUE OF TOTAL CANADA MARKET TRADES For personal use only 25% 20% 15% 10% 5% 0% Jan‐08 May‐08 Sep‐08 Jan‐09 May‐09 Sep‐09 CHI-X % VALUE OF AUSTRALIAN ON-MARKET

  20. Slide 20: Financial Markets – Subscription Revenue

    Presentation Title| Subtitle (change on master slide) FINANCIAL MARKETS –SUBSCRIPTION REVENUE FULL YEAR RESULTS – DECEMBER 2012 For personal use only 8.0 7.0 6.0 $A Millions 5.0 4.0 3.0 2007 2008 2009 2010 2011 2012 2013 Up to February 2013 19

  21. Slide 21: Financial Markets - Outlook

    Presentation Title| Subtitle (change on master slide) FINANCIAL MARKETS - OUTLOOK FULL YEAR RESULTS – DECEMBER 2012 For personal use only • 2013 outlook: • Positive sentiment change in January although very early. • March best-ex deadline continues to motivate smaller/medium brokers to comply or at

  22. Slide 22: Wealth Management

    Presentation Title| Subtitle (change on master slide) WEALTH MANAGEMENT FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Strong growth driven by product differentiation and delivery: • Revenue increased 6.6% on H1 2012 (up 9.2% on pcp) • Segment Profit increased 1.3% on H1 2012 (up 11.2% on

  23. Slide 23: Wealth Management - 2012

    Presentation Title| Subtitle (change on master slide) WEALTH MANAGEMENT - 2012 FULL YEAR RESULTS – DECEMBER 2012 For personal use only • FoFA and scaled advice maintaining heightened product and client activity: • XPLAN independently reviewed as most developed solution for FoFA. • Efficient fee disc

  24. Slide 24: Wealth Management – Subscription Revenue

    Presentation Title| Subtitle (change on master slide) WEALTH MANAGEMENT – SUBSCRIPTION REVENUE FULL YEAR RESULTS – DECEMBER 2012 For personal use only 5.0 4.0 $A Millions 3.0 2.0 1.0 0.0 2007 2008 2009 2010 2011 2012 2013 Up to February 2013 23

  25. Slide 25: Wealth Management Outlook

    Presentation Title| Subtitle (change on master slide) WEALTH MANAGEMENT OUTLOOK FULL YEAR RESULTS – DECEMBER 2012 For personal use only • 2013 outlook: • Strong positive revenue momentum into early trading. • Implementations and organic growth generating further demand. • With current and commencing

  26. Slide 26: Canada

    Presentation Title| Subtitle (change on master slide) FULL YEAR RESULTS – DECEMBER 2012 For personal use only HALF YEAR RESULTS - JUNE 2012 AUSTRALIA CANADA & NEW ZEALAND

  27. Slide 27: Canada - Overview

    Presentation Title| Subtitle (change on master slide) CANADA - OVERVIEW FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Impacted result: • Revenue (CAD) decreased 9.8% on H1 2012 (down 16.7% on pcp) • Segment Profit (CAD) decreased 17.1% on H1 2012 (down 34.6% on pcp) • Full year compariso

  28. Slide 28: Canada - Overview

    Presentation Title| Subtitle (change on master slide) CANADA - OVERVIEW FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Enhancements focused on improved trading workflow including middle office handling have been deployed to institutional clients. • IRESS FXM, now in production for all US

  29. Slide 29: Broadening Product/Business Segments

    Presentation Title| Subtitle (change on master slide) BROADENING PRODUCT/BUSINESS SEGMENTS FULL YEAR RESULTS – DECEMBER 2012 For personal use only • IRESS Professional Market Data • Continue to enhance Canadian Investment Adviser decision workflow and content. • Established initial market data prese

  30. Slide 30: Daily Trades in Canada

    Presentation Title| Subtitle (change on master slide) DAILY TRADES IN CANADA* FULL YEAR RESULTS – DECEMBER 2012 For personal use only 600 Alpha commenced H2’08 500 Chi_X commenced H1’08 Common Base from 2007 400 Pure Market commenced H1’07 300 Triact & Omega commenced H2’07 200 100 - Jan-07 Jan-08 J

  31. Slide 31: Canada – Monthly Subscription Revenue

    Presentation Title| Subtitle (change on master slide) CANADA – MONTHLY SUBSCRIPTION REVENUE FULL YEAR RESULTS – DECEMBER 2012 For personal use only 1.6 CAD$ Millions 1.2 0.8 0.4 2007 2008 2009 2010 2011 2012 2013 *Assumes 100% ownership Up to February 2013 30

  32. Slide 32: Canada - Outlook

    Presentation Title| Subtitle (change on master slide) CANADA - OUTLOOK FULL YEAR RESULTS – DECEMBER 2012 For personal use only • 2013 outlook • Trading in 2013 has commenced flat to slightly positive. • Consulting with clients to assist them in achieving cost savings while offering an extended IRESS

  33. Slide 33: South Africa

    Presentation Title| Subtitle (change on master slide) FULL YEAR RESULTS – DECEMBER 2012 For personal use only HALF YEAR RESULTS - JUNE 2012 AUSTRALIA CANADA SOUTH AFRICA & NEW ZEALAND

  34. Slide 34: South Africa

    Presentation Title| Subtitle (change on master slide) SOUTH AFRICA FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Solid South African result across segments: • Total revenue increased 3.7% (ZAR) on H1 2012 (up 7.9% pcp) • Segment Profit declined 4.5% (ZAR) on H1 2012 (down 12.0% pcp) • In

  35. Slide 35: South Africa – 2012

    Presentation Title| Subtitle (change on master slide) SOUTH AFRICA – 2012 FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Seamless transition to evolved trading architecture leveraging IRESS core technology. • High-performance IOS+ playing critical role in trading architecture at all broke

  36. Slide 36: South Africa – 2012

    Presentation Title| Subtitle (change on master slide) SOUTH AFRICA – 2012 FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Private Wealth Management • Unique solution combining trading, portfolio management, advisory tools in single integrated platform. Meaningful local integration well-est

  37. Slide 37: South Africa – Monthly Subscription Revenue

    Presentation Title| Subtitle (change on master slide) SOUTH AFRICA – MONTHLY SUBSCRIPTION REVENUE FULL YEAR RESULTS – DECEMBER 2012 For personal use only 16 ZAR Millions 12 8 Feb 11 Jun 11 Oct 11 Feb 12 Jun 12 Oct 12 Feb 13 Up to February 2013 Revenue variances partly due to Message Volumes fluctuat

  38. Slide 38: South Africa - Outlook

    Presentation Title| Subtitle (change on master slide) SOUTH AFRICA - OUTLOOK FULL YEAR RESULTS – DECEMBER 2012 For personal use only • 2013 outlook • Trading has commenced with slight negative momentum from previous half. • Mostly due to seasonal volume-based revenue, yet underlying subscription rev

  39. Slide 39: Asia

    Presentation Title| Subtitle (change on master slide) FULL YEAR RESULTS – DECEMBER 2012 For personal use only HALF YEAR RESULTS - JUNE 2012 AUSTRALIA CANADA ASIA & NEW ZEALAND

  40. Slide 40: Asia

    Presentation Title| Subtitle (change on master slide) ASIA FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Priority focus and success replacing MFG revenue with new platform opportunities. • Rollout of new CFD platforms successful to direct clients. Further opportunities in region advancin

  41. Slide 41: United Kingdom

    Presentation Title| Subtitle (change on master slide) FULL YEAR RESULTS – DECEMBER 2012 For personal use only HALF YEAR RESULTS - JUNE 2012 AUSTRALIA CANADA UNITED KINGDOM & NEW ZEALAND

  42. Slide 42: Wealth Management (UK)

    Presentation Title| Subtitle (change on master slide) WEALTH MANAGEMENT FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Over 12 months since commencement with significant client and experienced team: • Intensive localisation program to meet deployment priorities but with wider market reuse

  43. Slide 43: Financial Markets (UK)

    Presentation Title| Subtitle (change on master slide) FINANCIAL MARKETS FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Opportunities exist for outsourced managed solutions covering software, comprehensive market data, trading, deployment and ongoing management. • Retail online trading inc

  44. Slide 44: UK Outlook

    Presentation Title| Subtitle (change on master slide) UK OUTLOOK FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Revenue contribution to commence in 2013 as implementations progress. • Funding requirement for UK Segment Profit in 2013 expected to be at the self-imposed net-loss limit of $5

  45. Slide 45: Contact IRESS

    Presentation Title| Subtitle (change on master slide) CONTACT IRESS FULL YEAR RESULTS – DECEMBER 2012 For personal use only AUSTRALIA NEW ZEALAND ASIA Melbourne | +61 3 9018 5800 Auckland | +64 9 300 5571 Hong Kong | +852 3965 3341 Sydney | +61 2 8273 7000 Wellington | +64 4 462 6850 Singapore | +65

  46. Slide 46: Supplementary Information

    Presentation Title| Subtitle (change on master slide) SUPPLEMENTARY INFORMATION FULL YEAR RESULTS – DECEMBER 2012 For personal use only • Divisional dashboards • Strategic charges • Share grants 45

  47. Slide 47: Australia - Financial Markets

    Presentation Title| Subtitle (change on master slide) AUSTRALIA - FINANCIAL MARKETS FULL YEAR RESULTS – DECEMBER 2012 For personal use only H1 2012 H2 2012 %Chg LC H1'12 5% 6% 1% 6% 0% H2'12 6% (A#039;000) (A#039;000) 2% 2% 4% 4% Operating Revenue 54,549 54,206 -1% Segment Profit* 27,106 27,110 0% Segment

  48. Slide 48: Australia - Wealth Management

    Presentation Title| Subtitle (change on master slide) AUSTRALIA - WEALTH MANAGEMENT FULL YEAR RESULTS – DECEMBER 2012 For personal use only H1 2012 H2 2012 %Chg LC H1'12 6% 3%1% 6% 3% 2% H2'12 0% 0% 5% (A#039;000) (A#039;000) 5% Operating Revenue 26,076 27,788 7% Segment Profit* 11,607 11,759 1% Segment P

  49. Slide 49: Canada

    Presentation Title| Subtitle (change on master slide) CANADA FULL YEAR RESULTS – DECEMBER 2012 For personal use only H1'12 3% 3% 2% 2% H2'12 H1 2012 H2 2012 2% 9% %Chg LC 4% (CAD#039;000) (A#039;000) (CAD#039;000) (A#039;000) 10% 2% Operating Revenue 11,756 11,309 10,600 10,246 -10% 7% Segment Profit* 3,557 3,4

  50. Slide 50: South Africa

    Presentation Title| Subtitle (change on master slide) SOUTH AFRICA FULL YEAR RESULTS – DECEMBER 2012 For personal use only H1 2012 H2 2012 % Chg LC H1'12 4% 4% 5% 5% H2'12 6% (ZAR#039;000) (A#039;000) (ZAR#039;000) (A#039;000) 6% 2% 4% 2% Operating Revenue 88,234 10,816 91,502 10,438 4% 4% Segment Profit* 27,89

  51. Slide 51: Asia

    Presentation Title| Subtitle (change on master slide) ASIA FULL YEAR RESULTS – DECEMBER 2012 For personal use only H1 2012 H2 2012 H1'12 5% 1% 3% H2'12 %Chg LC 6% 7% (A#039;000) (A#039;000) 8% 1% 4% Operating Revenue 339 646 91% 1% 4% Segment Profit* (2,113) (1,856) -12% Segment PAT* (1,594) (1,422) -11%

  52. Slide 52: United Kingdom

    Presentation Title| Subtitle (change on master slide) UNITED KINGDOM FULL YEAR RESULTS – DECEMBER 2012 1% 5% 1% H2'12 1%4% 1% For personal use only H1'12 4% 9% 1% H1 2012 H2 2012 %Chg LC 4% (GBP#039;000) (A#039;000) (GBP#039;000) (A#039;000) Operating Revenue 14 22 201 309 Segment Profit* (807) (1,238) (1,125)

  53. Slide 53: Group Strategic Charges

    Presentation Title| Subtitle (change on master slide) GROUP STRATEGIC CHARGES FULL YEAR RESULTS – DECEMBER 2012 For personal use only 20 15 $A Millions 10 5 - 2009 2010 2011 2012 2013 2014 2015 2016 -5 Aust - Fin Mkts Aust - Wlth Mgt Can South Africa Asia UK AUD $ m Description H1 '1 2 H2 '1 2 H1 '1

  54. Slide 54: Non-Amortising Intangibles

    Presentation Title| Subtitle (change on master slide) NON-AMORTISING INTANGIBLES FULL YEAR RESULTS – DECEMBER 2012 For personal use only Cost (AUD) Description $m Amortisation period Plantech Goodwill 3.157 Visiplan Goodwill 10.695 Aust - Wlth Mgt Transactive Goodwill 0.285 DMS Goodwill 1.042 Goodwi

  55. Slide 55: Share Grants

    Presentation Title| Subtitle (change on master slide) SHARE GRANTS FULL YEAR RESULTS – DECEMBER 2012 • Value of staff share grants made in May 2012 (excludes MD): For personal use only • Deferred shares & Deferred Share Rights $6.363m (2011: $5.714m) • Performance Rights $1.510m (2011: $1.595m) • In

IRESS — FY2012 Earnings Presentation on 6ix