Col Financial Group, Inc. · PSE:COL
Col Financial — Q3 2020 Earnings Presentation
29 slides from Col Financial's earnings presentation, 2020
Slide 1: COL Financial Presentation
M20 wien BO COL FINANCIAL PRESENTATION
Slide 2: 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 21.6% stake and actively manages the Company 2
Slide 3: Shareholding structure and market cap
EDWARD K. LEE 21.6% DAIWA SECURITIES GROUP ALEXANDER C. YU 24.6% OTHER DIRECTORS & OFFICER PUBLIC 14.9% Outstanding 476.0Mil Shares 24.8% 14.1% Free Float 116.8Mil Market Cap* Php12.4Bil *AS OF END SEPTEMBER 2020 3
Slide 4: 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 4
Slide 5: The Biggest Philippine Based Broker
The Biggest Philippine Based Broker 9M20 VALUE 9M20 RANK BROKER NAME % OF TOTAL TURNOVER (PHPBIL) 1 CLSA PHILIPPINES, INC. 198.3 8.4% 2 UBS SECURITIES PHILIPPINES, INC. 171.6 7.2% 3 COL Financial Group, Inc. 167.1 7.1% 4 BDO SECURITIES CORP. 147.1 6.2% 5 CREDIT SUISSE SECURITIES (PHIL), INC. 125.6 5
Slide 6: Bulk of Revenues Generated from Commissions & Interest
REVENUE BREAKDOWN Bulk of Revenues Generated from 1.7% Trailer Fees Commissions & Interest 26.5% Interest COL’s Philippine operations account for 98.3% 1.7% HK Com of revenues. 7.4% PH Com-Agency & Advisory Commissions from both Philippines and HK account for 72.4% of revenues. Interest income from
Slide 7: Key Highlights
Key Highlights Positives Negatives Commission revenues remained Interest income fell sharply resilient; market share up Trailer fees down Record growth in new accounts Profits dropped Record positive net new flow 7
Slide 8: 9M20 Net Income -35.9% Y/Y
CONSOLIDATED INCOME STATEMENT (IN PHP MIL) 9M20 Net Income -35.9% Y/Y CHANGE 9M19 9M20 AMOUNT % Income 9M20 net income fell by 35.9% to Php294.9 Mil. Commissions 449.8 457.9 8.1 1.8% Interest 433.7 205.4 (228.3) -52.6% Consolidated revenues were down 24.1% to Php464.1 Mil. Trailer Fees 13.0 12.2 (0.
Slide 9: 3Q20 Net Income -36.4% Y/Y
CONSOLIDATED INCOME STATEMENT (IN PHP MIL) 3Q20 Net Income -36.4% Y/Y CHANGE 3Q19 3Q20 AMOUNT % Income 3Q20 net income fell by 36.4% to Php92.6 Mil. Commissions 155.3 157.6 2.4 1.5% Interest 126.2 50.1 (76.1) -60.3% Consolidated revenues were down 26.0% to Php212.3 Mil, Trailer Fees 4.4 4.3 (0.1) -2
Slide 10: Lower Interest Rates Pull Down Revenues
REVENUE BREAKDOWN (IN PHPMIL) Lower Interest Rates Pull CHANGE 9M19 9M20 AMOUNT % Down Revenues Philippines Commission 442.1 447.6 5.5 1.2% Self-directed 358.9 394.0 35.2 9.8% Agency & advisory 83.2 53.5 (29.7) -35.7% Revenues from Philippine operations decreased by 25.1%. Interest 433.0 205.4 (227.
Slide 11: Lower Interest Rates Pull Down Revenues
REVENUE BREAKDOWN (IN PHPMIL) Lower Interest Rates Pull CHANGE 9M19 9M20 AMOUNT % Down Revenues Philippines Commission 442.1 447.6 5.5 1.2% Self-directed 358.9 394.0 35.2 9.8% Agency & advisory 83.2 53.5 (29.7) -35.7% Trailer fees were down by 5.9% to Php12.2 Mil. Trailer fees Interest 433.0 205.4 (
Slide 12: Lower Interest Rates Pull Down Revenues
REVENUE BREAKDOWN (IN PHPMIL) Lower Interest Rates Pull CHANGE 3Q19 3Q20 AMOUNT % Down Revenues Philippines Commission 152.7 153.5 0.7 0.5% Self-directed 127.0 133.2 6.2 4.9% Agency & advisory 25.7 20.3 -5.5 -21.2% Revenues from Philippine operations decreased by 26.4%. Interest 125.6 50.1 -75.5 -60
Slide 13: Lower Interest Rates Pull Down Revenues
REVENUE BREAKDOWN (IN PHPMIL) Lower Interest Rates Pull CHANGE 3Q19 3Q20 AMOUNT % Down Revenues Philippines Commission 152.7 153.5 0.7 0.5% Self-directed 127.0 133.2 6.2 4.9% Agency & advisory 25.7 20.3 -5.5 -21.2% Trailer fees were down by 2.0% to Php4.3 Mil. Trailer fees Interest 125.6 50.1 -75.5
Slide 14: Lower Expenses
Lower Expenses BREAKDOWN OF EXPENSES (IN PHPMIL) CHANGE 9M19 9M20 Operating expenses fell by 4.0%, largely pulled down by AMOUNT % the 22.3% drop in trading related expenses. Trading Related Expenses Commission expenses 35.2 18.4 -16.9 -47.9% Trading related expenses fell due to the lower share of t
Slide 15: Lower Expenses
Lower Expenses BREAKDOWN OF EXPENSES (IN PHPMIL) CHANGE 9M19 9M20 Depreciation expenses more than doubled to Php47.7Mil AMOUNT % from Php23.0Mil. This was largely due to adoption of Trading Related Expenses PFRS16 which led to the booking of Php18.5 Mil in Commission expenses 35.2 18.4 -16.9 -47.9%
Slide 16: Market Share Improves
Market Share Improves COMPARATIVE PERFORMANCE (COL VS. PSE) CHANGE 9M19 9M20 AMOUNT % COL’s average daily turnover increased by 2.0% Y/Y to Php913.6 Mil in 9M20. In contrast, the PSE’s average daily PSE Ave. Daily T/O (PhpMil) 7,473.5 6,479.4 (994.1) -13.3% turnover fell 13.3%. COL Ave. Daily T/O (P
Slide 17: Market Share Improves
Market Share Improves COMPARATIVE PERFORMANCE (COL VS. PSE) 3Q19 4Q19 1Q20 2Q20 3Q20 Compared to the 3Q19, COL’s average daily turnover was flat at Php899.3 Mil 3Q20. Despite this, COL’s market share PSE Ave. Daily T/O 7,018.9 6,515.5 6,676.6 6,509.9 6,262.7 in terms of value turnover increased to 7
Slide 18: Market Share Up Y/Y
4.6% 9.3% 3.6% 7.8% 3.3% 6.9% 2.6% 5.6% 3.3% 7.5% SOURCE: PSE, COL ESTIMATES 4.6% 8.8% 4.1% 8.6% 4.1% 7.8% 4.3% 8.4% 3.3% 7.2% 4.1% 7.8% 3.9% 7.3% 5.2% 10.8% 6.0% 12.8% 6.0% 12.5% COL Market Share (Total) 4.8% 11.3% 5.8% 12.7% 6.2% 12.3% 6.4% 13.3% 6.8% 14.1% COL Market Share (Value T/O) 9.2% 17.7%
Slide 19: ROAE Down but Still Healthy at 22.8%
ROAE Down but Still Healthy at 22.8% SELECTED FINANCIAL INDICATORS CHANGE 9M19 9M20 AMOUNT % 9M20 operating profits were down 34.7% to Php396.8 Mil. Operating Profits Philippines 622.4 404.9 (217.5) -34.9% Operating profits from the Philippines were lower by Hong Kong (14.8) (8.1) 6.7 -45.4% 34.9% t
Slide 20: Strong Balance Sheet
Strong Balance Sheet CONSOLIDATED BALANCE SHEET (IN PHPMIL) CHANGE 12/31/19 9/30/20 AMOUNT % Cash & cash equivalents decreased by 32.4% to Php5.7 Bil largely due to placement of more cash in investment securities to earn Cash & equivalents 8,563.7 5,791.4 (2,772.3) -32.4% higher yields. Note that in
Slide 21: Accelerating Customer Growth
CLIENT BASE +24.6% 404,183 450,000 Accelerating Customer Growth 400,000 332,098 324,309 292,401 350,000 COL’s client base grew by 24.6% Y/Y to 404,183 as of 247,609 end September 2020. 300,000 205,039 250,000 Average monthly additions during the past 12 162,330 months reached 6,656. This was largely
Slide 22: Poor Market Conditions Limit Growth of Client Equity
CLIENT EQUITY (PHP MIL) +2.7% 90,000 Poor Market Conditions 78,133 76,100 73,102 72,673 72,398 80,000 Limit Growth of Client Equity 70,000 59,290 Client equity was up marginally by 2.7% Y/Y to 60,000 46,894 Php78.13 Bil as of end September 2020. 50,000 Although net new flows from retail clients rema
Slide 23: Margin Loans Down
AVE DAILY MARGIN LOANS (PHP MIL) -25.3% Margin Loans Down 1,200 971 Average daily margin loans decreased by 25.3% to 1,000 Php466 Mil Y/Y. 822 800 As of end September 2020, the total number of 624 617 approved margin accounts was 1,179, up slightly 596 536 compared to 1,150 as of end September 2019.
Slide 24: COL Accounts for a Sizeable Portion of Industry Non-Money Market Fund Sales
COL Accounts for a Sizeable Portion of Industry Non- Money Market Fund Sales 9M20 NET SALES (IN PHPMIL, ACC TO TYPE OF FUND) TYPE OF FUND INDUSTRY* COL Money Market 30,823.0 64.7 Bond Fund 222.5 116.4 Balanced Fund -360.5 20.0 Equity Fund 6,085.5 472.5 Total 36,770.6 673.5 *FUNDS AVAILABLE IN COL FU
Slide 25: COL Accounts for a Sizeable Portion of Some Fund Houses' Net Sales
COL Accounts for a Sizeable Portion of Some Fund Houses’ Net Sales 9M20 NET SALES (IN PHPMIL, ACC TO FUND HOUSE) TYPE OF FUND TOTAL* COL % SHARE ALFM -574.2 215.9 -37.6% ATR 225.3 23.3 10.3% FAMI 605.8 19.5 3.2% Phil Equity 542.2 300.4 55.4% PAMI 4,094.3 - - SLAMCI 31,134.0 114.5 0.4% Total 36,027.6
Slide 26: Average AUA Down
AVERAGE AUA (NON-MONEY MARKET FUNDS ONLY, IN PHP MIL) 3,500.0 2,949.2 2,911.4 2,905.8 2,879.3 2,769.0 2,630.3 2,606.3 2,568.2 3,000.0 2,435.6 2,332.4 2,238.8 2,500.0 2,028.5 Average AUA Down 1,766.5 2,000.0 1,529.1 1,328.4 1,174.0 1,500.0 1,003.8 Trailer fee down due to significant drop in average 7
Slide 27: Growing Number & Percentage of Clients Own MFs
10,000.0 20,000.0 30,000.0 40,000.0 50,000.0 60,000.0 70,000.0 0.0 SOURCE: COL ESTIMATES 5,244 3.4% 7,526 4.6% 11,859 6.9% 13,690 7.5% 16,599 8.5% 18,317 8.9% 20,493 9.5% 22,257 9.9% 24,739 10.4% MF Investors 27,375 11.1% 30,421 11.6% 32,675 12.0% 34,847 12.3% 36,349 12.4% % of Total Clients 38,069
Slide 28: ft wvicher life
© COL FINANCIAL ft wvicher life
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