Credit Corp Group Limited · ASX:CCP
Credit — FY2011 Earnings Presentation
18 slides from Credit's earnings presentation, Feb 11, 2016
Slide 1: FY11 Results Presentation
FY11 Results Presentation Thomas Beregi Chief Executive Officer Michael Eadie Chief Financial Officer
Slide 2: In 2011 we have delivered on two fronts
In 2011 we have delivered on two fronts • Leveraged g p past initiatives to accelerate g growth NPAT up 55% to $21.0m PDL collections and fee income up 14% to $206.8m Strong operating metrics across all areas • Implemented new initiatives to sustain performance Expanded E d d th the volume l
Slide 3: NPAT growth accelerates to 55%
NPAT growth accelerates to 55% FY11 Financials versus prior May 11 year Actual Guidance PDL collections and fee income up 14% to $ $206.8m Revenue up 22% to $113.6m Adjusted EBITDA (1) up 11% to $129.8m $122 - $124m NPAT (2) up 55% to $21.0m $20 - $21m EPS (basic) up 54% to 46.9 cents 44 - 46 cents
Slide 4: Increased returns while investing for sustained performance
Increased returns while investing for sustained performance FY11 Financials (continued) versus prior May 11 year Actual Guidance PDL acquisitions up 42% to $ $92.6m $ - $89m $87 $ ROE up 5pts to 22% Dividend per share up 150% to 20.0 cents(1) (1) Final dividend of 10c per share 4
Slide 5: Strong balance sheet platform
Strong balance sheet platform $ million FY11 FY10 FY09 FY08(1) Adjusted EBITDA (2) 129.8 117.2 97.4 87.3 Operating cash flow 119.5 103.2 82.0 82.9 PDL acquisitions and capex 95.7 62.7 37.7 81.6 Free cash flow 23.8 40.5 44.3 1.3 PDL carrying value 147.0 147.6 170.2 203.1 Net bank debt 23.8 42.1 81.2
Slide 6: Purchases meet ingoing projections
Purchases meet ingoing projections projections… Cumulative Collections ((Initial Expectations p versus Actual)) (July 08 – Jun 11) 550 500 450 Actual Cash Collections Cumulative 400 Collections 350 $m 300 250 200 Initial 150 P j ti Projections 100 50 - Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-0
Slide 7: …and we continue to drive collections from older PDLs
…and and we continue to drive collections from older PDLs PDLs... PDL Collections by y date of purchase 55.0 50.0 45.0 31% 32% 34% 40.0 31% 34% 31% 31% PDL Collections 35.0 31% > 3 years 19% 8% 29% $m 27% 11% 7% 2-3 years 30.0 28% 7% 15% 18% 18% 1-2 years 21% 19% 15% 16% 25.0 21% 18% < 1 year 20% 22
Slide 8: …while maintaining collection efficiency
…while while maintaining collection efficiency Debt Purchase Productivity (direct collection staff only) $275 $257 $256 $245 $255 Average $250 $ $238 $235 $239 $ $241 $245 $245 FY2011 $238 $243 $227 $230 $239 $224 $225 $234 FY2010 $231 $228 $228 PDL Collections $224 $224 $224 $226 per hour h $213 $2
Slide 9: And our strong payers base suggests this will continue
And our strong payers base suggests this will continue Total Portfolio Jun 2011 Dec 2010 June 2010 Dec 2009 June 2009 Dec 2008 Face value $3.2bn $2.9bn $2.6bn $2.5bn $2.2bn $2.2bn Number of accounts 413,000 319,000 302,000 306,000 284,000 319,000 Payment arrangements F Face value l $598 $598m $542 $
Slide 10: To sustain performance we have expanded the volume and type of purchases
To sustain performance we have expanded the volume and type of purchases FY11 Financials versus prior Actual FY11 year Year to Jun 11 May 11 Guidance PDL acquisitions Up 42% To $ $92.6m $ – $89m $87 $ • Purchasing incorporates new initiatives – First significant purchases in New Zealand – First tele
Slide 11: We have increased collection capacity…
We have increased collection capacity capacity… Headcount by function (FTE) 700 600 500 Support 400 Process Serving / Mercantile 300 Debt Purchase Operations 200 100 0 FY07 FY08 FY09 FY10 FY11 Function FY07 FY08 FY09 FY10 FY11 Debt Purchase Ops 294 405 435 516 615(3) Process Serving /Mercantile 86 9
Slide 12: …including the commencement of offshore operations
… including the commencement of offshore operations • Commenced in November 2010, grown to 80 FTE in June 2011 • Replaced existing offshore third party collection agents • Collecting C ll ti iinto t AAustralia t li and dNNew Z Zealand l d • Profitable in 5th month of operation • Located in Manila, M
Slide 13: Implemented technology-based improvement rollouts
Implemented technology-based technology based improvement rollouts In-house technology Business objectives • Workflow Management tool − Analytically-driven software to manage − Reduce downtime between collection ledger activity actions − Enable supervisors to focus on managing the quality of collect
Slide 14: Expanded FY11 purchasing will contribute to solid performance in FY12
Expanded FY11 purchasing will contribute to solid performance in FY12 FY12… $92.6m $65m $65m FY12 Purchasing Purchases Guide: $45 - $65m $37m Contracted $34.2m as at Aug 2011 FY09 Actual FY10 Actual FY11 Actual FY12 14
Slide 15: …while we will maintain our purchasing discipline in FY12
…while we will maintain our purchasing discipline in FY12 • Deterioration in qqualityy of charged-off g debt over the last 18 months(1) • Credit Corp has leveraged improved operational execution to maintain attractive PDL prices • Recent eevidence idence that competitor pricing is no now be beyond o
Slide 16: In FY12 we will deliver solid results while leveraging recent initiatives
In FY12 we will deliver solid results while leveraging recent initiatives to produce sustained performance • Continue to improve p operational p p performance in-house technological innovation asset management low cost platform • Utilise platforms developed in FY11 to initiate i iti t geogra
Slide 17: Solid result expected for FY12
Solid result expected for FY12 FY12 Guidance PDL acquisitions $45 - $65m NPAT $21 - $23m EPS (basic) 46 - 51 cents Dividends per share 23 - 25 cents Guidance excludes potential shareholder litigation costs over the balance of the year 17
Slide 18: FY11 Results Presentation – Questions
FY11 Results Presentation Questions