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Beforepay Group Limited ASX:B4P

H1 FY24 Half Year Results Presentation 26 February 2024 Unaudited

Disclaimer

This presentation has been prepared by Beforepay Group Limited (‘Beforepay’ or the ‘Company’).

This presentation contains selected summary information only and is provided for general information purposes only. It is not a prospectus, product disclosure statement, pathfinder document or any other disclosure document for the purposes of the Corporations Act and has not been, and is not required to be, lodged with the Australian Securities & Investments Commission. Nothing in this presentation constitutes investment, legal, tax, accounting or other advice and it is not to be relied upon in substitution for the recipient’s own exercise of independent judgment with regard to the operations, financial condition and prospects of Beforepay or the Beforepay Group. The information contained in this presentation does not constitute financial product advice. Before making an investment decision, the recipient should consider its own financial situation, objectives and needs, and conduct its own independent investigation and assessment of the contents of this presentation, including obtaining investment, legal, tax, accounting and such other advice as it considers necessary or appropriate.

This presentation has been prepared without taking account of any person’s individual investment objectives, financial situation or particular needs. It is not an invitation to buy or sell, or a solicitation to invest in or refrain from investing in, securities in Beforepay. The information in this presentation has been obtained from and based on sources believed by Beforepay to be reliable. To the maximum extent permitted by law, Beforepay and the members of the Beforepay Group make no representation or warranty, express or implied, as to the accuracy, completeness, timeliness or reliability of the contents of this presentation. To the maximum extent permitted by law, Beforepay does not accept any liability (including, without limitation, any liability arising from fault or negligence) for any loss whatsoever arising from the use of this presentation or its contents or otherwise arising in connection with it.

This presentation may contain forward-looking statements, guidance, forecasts, estimates, prospects, projections or statements in relation to future matters (‘Forward Statements’). Forward Statements can generally be identified by the use of forward-looking words such as “anticipate”, “estimates”, “will”, “should”, “could”, “may”, “expects”, “plans”, “forecast”, “target” or similar expressions. Forward Statements including indications, guidance or outlook on future revenues, distributions or financial position and performance or return or growth in underlying investments are provided as a general guide only and should not be relied upon as an indication or guarantee of future performance. No independent third party has reviewed the reasonableness of any such statements or assumptions. This presentation includes information regarding past performance of Beforepay and investors should be aware that past performance is not and should not be relied upon as being indicative of future performance.

Neither Beforepay nor any member of Beforepay Group represents or warrants that such Forward Statements will be achieved or will prove to be correct or gives any warranty, express or implied, as to the accuracy, completeness, likelihood of achievement or reasonableness of any Forward Statement contained in this presentation. Except as required by law or regulation, Beforepay assumes no obligation to release updates or revisions to Forward Statements to reflect any changes.

Investors should note that certain financial data included in this presentation is not recognised under the Australian Accounting Standards and is classified as ‘non-IFRS financial information’ under ASIC Regulatory Guide 230 ‘Disclosing non-IFRS financial information’ (‘RG 230’). Beforepay considers that non-IFRS information provides useful information to users in measuring the financial performance and position of Beforepay. The non-IFRS financial measures do not have standardised meanings under Australian Accounting Standards and therefore may not be comparable to similarly titled measures determined in accordance with Australian Accounting Standards. Readers are cautioned therefore not to place undue reliance on any non-IFRS financial information and ratios in this presentation. All dollar values are in Australian dollars ($or A$) unless stated otherwise.

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What we do

Beforepay provides fast and affordable short-term finance to Australians, designed to prevent customers getting into too much debt or paying compound interest

We also offer our automated platform and AI-powered risk models to partners in other jurisdictions.

4.7 stars 1

Note 1:

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Ethical short-term finance[2]

We are a 2 time ethical award winner that provide small advances ($387 on average) directly to consumers. We are not a Buy-Now-Pay-Later provider.

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Artificial-intelligence powered risk management

Sophisticated proprietary models assess customer probability of default and determine limits based on estimates of default elasticity and lifetime value.

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Designed to be affordable

We charge a one-time 5% fee on the amount advanced, with no interest or late fees, a fraction of the cost of a payday lender.

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Highly efficient automated platform

Automated digital platform enables new customers to onboard and receive funds in as little as 5 minutes. Thousands of loans are originated each day with our small team of 33 employees[3] .

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Designed for customer safety

Customers do not pay compound interest and can only take one advance at a time, reducing the risk of a debt spiral.

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Data at the core

Significant data asset with more than 1.3 billion lines of transaction data; strong data-science and AI capabilities and culture.

Unaudited figure; includes ratings from iOS App Store and Google Play Store.
Based on Ethical Lender of the Year – Pan Finance International Awards 2023 & Ethical Lender of the Year – Wealth & Finance International FinTech Awards 2023. 3. Not including directors or offshore contractors.

Ethical lending

Awards we’ve won

The use case . We believe that nobody wants to be in debt. We believe that most people, when money is tight, only want to borrow a small amount of money for a short period of time, to tide them over until they get paid.

The product . We advance small amounts of money (average of $387) for an average of 3 to 4 weeks. We charge a simple 5% fee with nothing else to pay, and debit customers’ accounts as they get paid.

Safe and affordable . The product is designed with safety in mind. Advances are sized to reflect our understanding of the customer’s financial situation. There is no compound interest, and customers can only take out one advance at a time. The 5% fee means an average all-in cost to the customer of less than $20.

The outcome . This gives people flexibility when they’re just short on funds or facing unexpected expenses, without tying them to an ongoing debt burden.

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Ashurst FinTech Startup of the Best App-Based Lending Year 2020 – Australian FinTech Company 2023 – APAC Insider

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Tech Fast 50 Company 2023 – Ethical Lender of the Year 2023 – Deloitte Wealth & Finance International

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Ethical Lender of the Year 2023 – Pan Finance International

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*All numbers are unaudited.

Efficient platform; AI-powered risk management

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The need. We offer small, short-term advances that cost customers less than $20 all-in, on average. To do so, we need to keep our operating costs and defaults low.

Efficient and automated platform. While customer support is available, the vast majority of new and existing users are able to self-service in minutes, with no human intervention at any point in the lending journey. Everything from onboarding to repayment is automated.

Best-in-class risk management, powered by artificial intelligence. We train proprietary AI models on our database of more than 1.3 billion lines of transaction data, and more than 4 million advances, to assess customer risk, and to determine the best limit for them.

*All numbers are unaudited.

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Business Update

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H1 FY24 Highlights

$2.2m

NPBT profit in H1 FY24, up from a loss ($4.4m) in H1 FY23.

2.8%

$4.2m

EBITDA profit in H1 FY24, up from a loss ($2.7m) in H1 FY23.

1.3%

$359m Advances in H1 FY24, up 18% from H1 FY23. $1.4 billion

16%

Growth in Active Users YoY to 235,644 in H1 FY24.

96%

Net Transaction Margin in H1 FY24, up from 1.7% in H1 FY23.

$18.9m

Cash and Cash Equivalents at 31 December 2023.

Net Defaults in H1 FY24, down from 2.3% in H1 FY23. $29.7m

Equity at 31 December 2023.

Cumulative Advances surpassed since inception in 2019.

1.2 million Registered Users since inception in 2019.

of Active Users who have successfully repaid their first Advance have since taken out a second Advance at the end of H1 FY24.

$31

Average Customer Acquisition Cost in H1 FY24, down 48% from $59 in H1 FY23.

Note: Certain financial metrics and information included throughout this presentation are not recognised under the Australian Accounting Standards and are classified as ‘non-IFRS financial information’. See Glossary for definitions of non-IFRS financial information. Non-IFRS financial information is unaudited. Change % is calculated using unrounded figures and may differ slightly from a number calculated using rounded figures.

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H1 FY24 Highlights

Key Metrics	H1 FY24	H1 FY23	% Change	H2 FY23	% Change

Advances ($m)	358.6	303.9	18%	324.1	11%
Average advance ($)	387	391	(1%)	346	12%
Active users (no. of users)	235,644	203,937	16%	234,034	1%

Beforepay revenue ($m)	17.6	14.6	21%	16.1	9%
Net transaction margin ($m)	10.1	5.1	99%	6.6	51%
Other income and interest revenue ($m)	0.0	1.4	(98%)	0.0	-%
Operating expenses, excluding one-off and/or significant items ($m)	(7.7)	(10.6)	(27%)	(8.1)	(5%)
Depreciation & amortisation expenses ($m)	(0.2)	(0.3)	(33%)	(0.2)	6%
Non-operating expenses, and one-off and/or significant items ($m)	0.0	(0.0)	–%	(0.5)	Large
Net Profit Before Tax ($m)	2.2	(4.4)	Large	(2.2)	Large
EBITDA, excluding one-off and/or significant items ($m)	4.2	(2.7)	Large	(0.4)	Large

Gross defaults % (of advances plus fee)	(2.3%)	(3.2%)	(28%)	(3.0%)	(24%)
Net defaults % (of advances plus fee)	(1.3%)	(2.3%)	(43%)	(2.0%)	(34%)
Net transaction margin % (of advances)	2.8%	1.7%	65%	2.1%	36%
A$ Balance Sheet			H1 FY24	FY23	% Change

Cash position ($m)			18.9	21.8	(13%)
Equity position ($m)			29.7	26.8	11%

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Strong Growth in Net Transaction Margin $ Along with Tight Cost Control

Net Transaction Margin and Operating Expenses by Half Year

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$12.8m
Operating Expenses $12.6m
down 27% to $7.7m in H1 FY24 from
10.6m in H1 FY23.
$10.6m
$10.1m
$8.1m
$7.7m
$6.6m
$5.1m
$3.2m
Net Transaction Margin
up 99% to $10.1m in H1 FY24 from
$5.1m in H1 FY23. $0.4m
H1-FY22 H2-FY22 H1-FY23 H2-FY23 H1-FY24
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Total and Average Advances

Incremental Growth in Advances

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Total Advances ($m) Average Advances ($)
by Half Year by Half Year
+18% (1%)
$391 $387
$359m
$324m $346
$304m
$291
$241
$195m
$179
$132m
$124
$73m
$20m
H1-FY21 H2-FY21 H1-FY22 H2-FY22 H1-FY23 H2-FY23 H1-FY24 H1-FY21 H2-FY21 H1-FY22 H2-FY22 H1-FY23 H2-FY23 H1-FY24
Note: Certain financial metrics and information included throughout this presentation are not recognised under the Australian Accounting Standards and are classified as ‘non-IFRS financial information’.
See Glossary for definitions of non-IFRS financial information. Non-IFRS financial information is unaudited. Change % is calculated using unrounded figures and may differ slightly from a number calculated using rounded figures.
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Active Users

235,644 Active Users or 16% Growth in H1 FY24

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+16%
Active Users by Half Year
234,034 235,644
96%
203,937
of Active Users who have
successfully repaid their first
Advance have since taken out a 173,398
second Advance at end of H1 FY24.
139,071
102,671
46,486
Dec-20 Jun-21 Dec-21 Jun-22 Dec-22 Jun-23 Dec-23
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Declining Trend in Loan Defaults

Demonstrating Consistent Improvement in Credit Quality

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Gross and Net Defaults
H1 FY23 H1 FY24H1 FY24
% by Half Year
3.2% gross 2.3% net 2.3% gross 1.3% net
7.4%
7.4%
4.6%
4.6%
3.3%
3.2%
3.0%
2.9%
2.9% 2.3%
2.3%
2.0% 2.0%
1.3%
Gross defaults % (of advances inclusive of fees)
Net defaults % (of advances inclusive of fees)
H1-FY21 H2-FY21 H1-FY22 H2-FY22 H1-FY23 H2-FY23 H1-FY24
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Funding Costs – Debt Facility

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The short duration of our advances keeps funding costs low.
80%
26 days 15.31% ~87 bps
x x =
Theoretical maximum
(0.07 years) Cost of external loan-to-value ratio of external Third party funding costs %
Average duration debt facility based on average duration
debt facility
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The actual realised funding cost may vary below this level based on the rate of utilisation of the facility. Note: Certain financial metrics and information included throughout this presentation are not recognised under the Australian Accounting Standards and are classified as ‘non-IFRS financial information’. See Glossary for definitions of non-IFRS financial information. Non-IFRS financial information is unaudited. Change % is calculated using unrounded figures and may differ slightly from a number calculated using rounded figures.

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Direct Service Costs

Continue to be Tightly Managed

Direct service costs include the costs in facilitating Advances to customers: data collection, transaction categorisation, direct credit and direct debit.

Direct costs generally do not vary with the amount advanced – positive operating leverage.

Direct service costs as a % of Advances reduced to 0.2% in H1 FY24 (0.3% in H1 FY23). Decreases were due to vendor negotiations, adjustments to vendors used and hitting volume thresholds in rate cards.

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Direct Service Costs per
Advance by Half Year
H1 FY23 H1 FY24
0.3% of Advances 0.2% of Advances
$2.68
$2.41
$1.80
$1.32
$1.24
$1.09
$0.87
H1-FY21 H2-FY21 H1-FY22 H2-FY22 H1-FY23 H2-FY23 H1-FY24
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Balance Sheet

Strong Cash and Equity Position

$m	H1 FY24	FY23	$ Change	% Change	Commentary
Cash position	18.9	21.8	(2.9)	(13%)	Reflects timing of issuing advances and customer repayments, as well as drawdown of receivables financing
Receivables	46.0	41.8	4.2	10%	Reflects growth in loan book and level of advances
Other assets	1.0	1.6	(0.6)	(32%)	Primarily due to lower non-current assets and prepayments
Total assets	65.9	65.2	0.7	1%
Borrowings	32.9	33.3	(0.4)	(1%)	Debt facility utilisation to finance receivables. The full repayment of the original Longreach Credit Investors facility dated 9 June 2021 ($33.3m) took place on 19 October 2023
Other liabilities	3.3	5.1	(1.8)	(34%)	Reflects decreases in trade and other payables
Total liabilities	36.2	38.4	(2.2)	(5%)
Equity position	29.7	26.8	2.9	11%
Total debt facilities	32.9	33.3	(0.4)	(1%)	Total drawdown in third party debt facility ($20m from Balmain Group (100% drawn) and $12.9m from Longreach Credit Investors (37% drawn))
Undrawn facilities	22.1	11.7	10.4	89%	The total facility limit of the new debt facility agreement is $55m ($20m Balmain Group and $35m Longreach Credit Investors), expiring in October 2026

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Cash Flow Statement

Operating, Investing and Financing Activities

$32.9m	H1 FY24	H2 FY23	H1 FY23
Receipts from repayment of customers advances	355.1	328.5	276.5
Receipts of Beforepay income	12.0	3.8	21.3
Payments to suppliers and employees	(7.9)	(8.3)	(10.9)
Advances to customers	(358.6)	(324.1)	(303.9)
Other	(1.9)	(0.2)	(1.2)
Net cash used in operating activities	(1.3)	(0.3)	(18.2)

Net cash used in investing activities	–	–	–
Proceeds from issue of shares	0.1	–	–
Borrowings transaction costs	(1.1)	–	–
Net proceeds from borrowings	32.9	3.6	8.7
Repayment of borrowings	(33.3)	–	–
Other	(0.2)	(0.2)	(0.2)
Net cash from financing activities	(1.6)	3.4	8.5
Net increase/(decrease) in cash and cash equivalents	(2.9)	3.1	(9.7)
Cash and cash equivalents at the beginning of the financial period	21.8	18.7	28.4
Cash and cash equivalents at the end of the financial period	18.9	21.8	18.7

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Our Profitability Model

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Our Profitability Model

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Advances x Net transaction ≥ Monthly operating
per month margin % expenses
Active users Revenue Monthly overheads

x +
Advances per AU Net defaults Monthly marketing
per month expense
x
Average advance Funding costs
_
Direct costs
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NTM & Profit/(Loss) by Half Year

	H1 FY24	H2 FY23	H1 FY23	H2 FY22	H1 FY22
Active users (no.ofusers)	235,644	234,034	203,937	173,398	139,071
Average advance($)	387	346	391	291	241
Advances ($m)	358.6	324.1	303.9	195.3	132.0
Beforepayrevenue*% (ofadvances)	4.9%	5.0%	4.8%	4.8%	4.4%
Net defaults %(of advancesplus fees)	(1.3%)	(2.0%)	(2.3%)	(2.0%)	(2.9%)
Fundingcosts %(of advances)	(0.6%)	(0.6%)	(0.5%)	(0.7%)	(0.5%)
Direct costs %(of advances)	(0.2%)	(0.3%)	(0.3%)	(0.5%)	(0.7%)
Net transaction margin % (of advances)	2.8%	2.1%	1.7%	1.6%	0.3%
Net transaction margin($m)	10.1	6.7	5.1	3.2	0.4
Advertising & marketing expenses ($m)	(1.4)	(1.8)	(3.5)	(6.1)	(6.8)
Employee, G&A and other operating expenses ($m)	(6.3)	(6.4)	(7.1)	(6.5)	(6.0)
Operating expenses, excluding one-off and/or significant items ($m)	(7.7)	(8.2)	(10.6)	(12.6)	(12.8)
Other income andinterestrevenue ($m)	0.0	0.0	1.4	0.0	0.6
Depreciation & amortisation expenses ($m)	(0.2)	(0.2)	(0.3)	(0.3)	(0.3)
Non-operating expenses, and one-off and/or significant items ($m)	0.0	(0.5)	(0.0)	0.2	(7.5)
Net Profit/(Loss) Before Tax ($m)	2.2	(2.2)	(4.4)	(9.5)	(19.6)

Beforepay consistently charge 5% on the amount advanced. The percentages differ slightly due to timing of the advances. Note: Certain financial metrics and information included throughout this presentation are not recognised under the Australian Accounting Standards and are classified as ‘non-IFRS financial information’. See Glossary for definitions of non-IFRS financial information. Non-IFRS financial information is unaudited. Change % is calculated using unrounded figures and may differ slightly from a number calculated using rounded figures.

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Strategy Update

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Our strategy has been to achieve profitability in our core product and market

Q3 – Q4 FY22

“Beforepay will continue to explore international expansion opportunities, however maintains a current focus on its path to profitability by managing costs and delivering on growth domestically.”

Q1 – Q4 FY23

“Beforepay will continue to explore new growth opportunities, however, maintains a current focus on its path to profitability by managing costs and delivering on growth in its current products and geographies.”

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● We achieved profitability in
1
H1 FY24 ($2.2m NPBT).
● While individual reporting period
2 results may be up or down, we
believe we have delivered on
our path to profitability.
● This is the appropriate time
3
to consider strategically
what comes next.
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The addressable market continues to be significant…

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Active user growth Market penetration
235,644
234,034 5,300,000
203,937
173,398
139,071
102,671
46,486
235,644
H1-FY21 H2-FY21 H1-FY22 H2-FY22 H1-FY23 H2-FY23 H1-FY24 Active Users Employed population in Australia, ages 20-54,
without extensive savings
Defined as less than two months’ salary in savings. Source: Beforepay Replacement Prospectus, November 2021.
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…and we have strong competitive advantages to drive the next phase of our growth

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A proprietary data asset of more than 1.3 billion rows and more than 4 million advances issued to date An extensive collection of Intellectual Property (IP) and capabilities around analytic risk management and product delivery

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A low direct cost base supported by highly automated, highly efficient origination and servicing systems, and lean overheads A large installed user base with high levels of customer engagement and advocacy

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Potential opportunities: Our risk capabilities and platform enable geographic and product expansion

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Additional products
Today 1
in Australia
Wage advance Personal loans Other unsecured
consumer lending
Rest of World
North America
Partner-based international expansion
2
Europe
Markets
Australia
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Additional products in Australia
1
•
Larger, longer-dated loans.
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Alternative pricing models and structures.
Custom risk models for product variants.

Partner-based international expansion

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2
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Provide SaaS services for partners to issue their own wage-advance products using our proprietary risk engine capabilities.
Where appropriate, consider deploying own risk budget and balance sheet alongside partner.

Products

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Our strategy – now and next steps

Underway/start now

Next steps after that

Replatform our business

Upgrade and extend our lending platform to support a wider range of products and to enable overseas partners on a B2B basis.

Apply for an Australian Credit Licence (ACL)

Apply for an ACL and build the supporting systems and processes, in order to offer regulated products.

Search for international partners Continue outreach to potential partners for an offshore expansion effort.

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Start product experimentation

Test different loan durations and sizes, starting adjacent to our current product (e.g. $3,000 for 3 months, then $5,000 for 6 months).

Test alternative pricing structures for longer loans.

Extend risk model architecture Build model variants across different markets and product configurations.

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What you’ll see when

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FY24: Preparation and Build phase

Expect moderate cost increases as we ramp up and replatform.
Progress important milestones required for launch.
No material revenue increase from new activities expected in this financial year.

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FY25: Launch phase

Start with additional domestic products.
Growth rate is unknown and depends on results of

experimentation – we move at the rate that the data tells us to move.

Possible overseas partnerships – when/if we find the right partner(s) in the right market.

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Q&A

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Thank You

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Appendix

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H1 FY24 Management Profit & Loss (P&L)

A$, unless otherwise stated	H1 FY24	A$, unless otherwise stated	H1 FY24
Beforepay revenue	17,635,458	EBITDA, excluding one-off and/or significant items	4,244,438
Gross defaults	(8,609,586)
Gross %(of advances inclusive of fees)	(2.3%)	Depreciation & amortisation expenses(D&A)	(244,244)
Recoveries(net of costs)	3,695,784	Removal of D&A related to lease accounting already recognised in occupancy expense in EBITDA	182,850
Recoveries %(ofgross defaults)	42.9%
		Finance costs	(1,969,653)
Net defaults	(4,913,802)

Net defaults %(of advances inclusive of fees)	(1.3%)
		Total one-off and/or significant items	–
Thirdpartyfundingcosts	(1,857,710)

Thirdpartyfundingcosts %(of advances)	(0.6%)
		Profit before income tax	2,213,391
Direct costs	(802,562)
Direct costs %(of advances)	(0.2%)
Net transaction margin(NTM)	10,061,384
Net transaction margin %(of Beforepayrevenue)	57.1%

Employee benefits expenses	(4,141,643)
G&A and other expenses	(2,119,632)
Advertisingand marketingexpenses	(1,433,735)
Total operating expenses	(7,695,010)

Total non-operatingexpenses	(3,850)
Other income and interest revenue not recognised in NTM	24,204
Add back: Thirdpartyfundingcosts deducted from NTM	1,857,710
EBITDA, excluding one-off and/or significant items	4,244,438

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H1 FY24 NTM Reconciliation to Statutory P&L

Management P&L – Revenue to Net Transaction Margin

Statutory Profit and Loss

2 1 Expected credit loss expense Equal to Expected credit loss expense, before the benefit of recoveries Part of the $1.97M of Finance costs related to funding advances Direct service cost 3 4 Reference to Statutory Profit and Loss Beforepay income	A$, unless otherwise stated H1 FY24	A$, unless otherwise stated H1 FY24	2 1 4 3
	Revenue
	Beforepay income $17,635,458
	Interest and other income $24,204
	Expenses
	Direct service cost ($802,562)
	Employee benefits expense ($4,141,643)
	Depreciation and amortisation expense ($244,246)
	Expected credit losses expense ($4,913,802)
	Occupancy expenses ($33,760)
	Advertising and marketing expenses ($1,433,735)
	Professional and consultancy expenses ($737,725)
	Software licences ($12,664)
	Technical suppliers ($567,316)
	Other expenses ($589,165)
	Finance costs ($1,969,653)
	Profit before income tax expense	$2,213,391
	Income tax expense	–
	Profit after income tax expense for the year attributable to the owners of Beforepay Group Limited	$2,213,391
	Other comprehensive income for theperiod, net of tax	–
	Total comprehensive income for the period attributable to the owners of Beforepay Group Limited	$2,213,391

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H1 FY24 EBITDA Reconciliation to Statutory P&L

Management P&L – Net Transaction Margin to EBITDA

Statutory Profit and Loss

A$, unless otherwise stated	H1 FY24	H1 FY24
Net transaction margin	10,061,384
Net transaction margin %(of Beforepayrevenue)	57.1%

Employee benefits expense	(4,141,643)
G&A and other expenses	(2,119,632)
Advertisingand marketingexpenses	(1,433,735)
Total operating expenses	(7,695,010)

Total non-operating expenses		(3,850)
Other income and interest revenue not recognised in NTM		24,204
Add back: Third party funding costs deducted from NTM		1,857,710

EBITDA, excluding one-off and/or significant items	4,244,438

A$, unless otherwise stated H1 FY24	A$, unless otherwise stated H1 FY24	3 1 2
Revenue
Beforepayincome	$17,635,458
Interest and other income	$24,204
Expenses
Direct service cost	($802,562)
Employee benefits expense	($4,141,643)
Depreciation and amortisation expense	($244,246)
Expected credit losses expense	($4,913,802)
Occupancyexpenses	($33,760)
Advertisingand marketingexpenses	($1,433,735)
Professional and consultancyexpenses	($737,725)
Software licences	($12,664)
Technical suppliers	($567,316)
Other expenses	($589,165)
Finance costs	($1,969,653)
Profit before income tax expense	$2,213,391
Income tax expense	–
Profit after income tax expense for the year attributable to the owners of Beforepay Group Limited	$2,213,391
Other comprehensive income for theperiod,net of tax	–
Total comprehensive income for the period attributable to the owners of Beforepay Group Limited	$2,213,391

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Glossary

Term	Definition	Term	Definition
Active Users	A customer of Beforepay, who has taken out an advance in the previous 12 months from the date of the relevant information. This includes customers who have not repaid their most recent cash out and are not eligible to re-borrow until they have done so. The figures presented on Active Users are unaudited.	Customer Acquisition Costs	Advertising and marketing expenses attributable to customer acquisition divided by the number of first time cash outs. The figures presented on Customer Acquisition Costs are unaudited.
		Depreciation and Amortisation Expense	Depreciation and amortisation expense are related to lease liabilities that the Company considers effectively to be a part of occupancy costs.
Average Advance	Total dollar volume of advances in a period divided by the number of advances in that period. The figures presented on Average Advance are unaudited.
		Direct Costs or Direct Service Costs	Direct service costs include the cost of services involved in facilitating advances to customers: data collection, transaction categorisation, direct credit, and direct debit.
App	Either one of the two smartphone applications of Beforepay, one for iOS devices and one for Android or the web application, as appropriate in its context.
		Direct Costs % (of advances)	Direct costs in facilitating advances to customers divided by advances.
ASIC	Australian Securities and Investments Commission.
		Duration	The average across all advances of the time required to repay the advance, weighted by the dollar size of each advance. A advance that is not repaid within 62 days is assumed to have a duration of 62 days.
ASX	ASX Limited or the securities exchange that it operates, as the context requires.
Beforepay	The Company and its controlled entities (and, where the context requires, the businesses conducted by those entities).
		EBITDA	Earnings before interest, taxation, depreciation and amortization (adjusted). The figures presented on EBITDA are unaudited.
Beforepay Income or Beforepay Revenue	The transactions fees charged to customers on advances. Beforepay income or Beforepay revenue is calculated and charged based on a fixed percentage (5%) of the amount advanced.
		EBITDA, excluding One- Off and/or Significant Items	EBITDA less one-off and/or significant items.
Cash Out or Advances	An advance made or offered by Beforepay to a user.

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Glossary

Term	Definition	Term	Definition
Finance Costs	Finance costs are related to the debt facility with Longreach Credit investors and Balmain Group (Lenders ) and interest on lease liability.	Net Defaults	Actual and expected credit losses (net of recoveries). It comprises customer defaults plus current advances provisioned during the period. The figures presented on Net Defaults are unaudited.
Fixed Charge Cover Ratio or FCCR	EBITDA divided by Interest Expense, for the preceding 12 months (on a rolling basis).	Net Defaults %	Net defaults as a percentage of advances plus fees. The figures presented on Net Defaults % are unaudited.
G&A and Other Expenses	Occupancy expenses, professional and consultancy expenses, software licenses, technical suppliers, and other expenses (all from the full-year FY2023 statutory financial statements).	Net Transaction Margin	Comprises Beforepay income (being Beforepay advance fee income) less the variable costs associated with facilitating the advance transaction (net of recoveries). Variable costs include net defaults, third party funding costs and direct service costs. Net transaction margin is a management metric used to measure the gross margin on advances. The figures presented on Net Transaction Margin are unaudited.
Group	The Company and each of its subsidiaries.
Gross Defaults	Expected credit loss expense excluding recoveries.
Gross Defaults %	Gross defaults as a percentage of advances plus fees. The figures presented on Gross Defaults % are unaudited.
		Net Transaction Margin %	Net transaction margin as a percentage of advances. The figures presented on Net Transaction Margin % are unaudited.
IFRS	International Financial Reporting Standards issued by the International Accounting Standards Board.
		Non-IFRS Financial Information	The term non-IFRS financial information – or ‘alternative performance measures’ (APMs) – captures any measure of past or future financial position, performance or cash flows that is not prescribed by the relevant accounting standards. Examples are adjusted earnings (or adjusted profit), normalised or underlying earnings, constant currency revenue growth (like-for-like earnings), net debt, and return on capital employed.
Interest Income	Interest earned on cash at bank. It is not the fee that Beforepay charges to its customers.
Lenders	AMAL Trustees Pty Ltd as trustee for Longreach Direct Lending Fund (‘Longreach Credit Investors’) and Australian Commercial Mortgage Corporation Pty Ltd as trustee for the Australian AB Finance Trust (‘Balmain Group’).
Management	The executive management team of Beforepay.

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Glossary

Term	Definition	Term	Definition
Operating Expenses	The sum of all expenses less one-off and/or significant items, net defaults, direct costs, finance costs, and depreciation and amortisation expense (adjusted).	Third-Party Debt Facility	The third-party debt facility agreement with Australian Commercial Mortgage Corporation Pty Ltd as trustee for the Australian AB Finance Trust (Balmain Group) and AMAL Trustees Pty Ltd as trustee for the Longreach Direct Lending Fund (Longreach Credit Investors). The $55 million facility ($35 million from Longreach Credit Investors and $20 million from Balmain Group) is for 3 years to 15 October 2026 with the potential to extend the total facility size in a future period. The maximum commitment increases in non- linear increments over time to $55 million by 14 June 2025.
Advances or Total Advances	The aggregate dollar value of cash outs in a specified period to a user. The figures presented on Advances are unaudited.
Pay on Demand	Pay-on-demand, being the product offered by Beforepay via cash outs.
Recoveries	Monies repaid by customers after an advance has defaulted at 62 days after the date of issuance (net of costs) of the recovery.
		Third Party Funding Costs or Cost of External Debt Facility	Third party financing costs related to the cash interest costs of funding advances through drawing on the third-party debt facility.
Recoveries %	Recoveries divided by gross defaults.
Revenue	Revenue includes Beforepay revenue plus interest income.
Reuse Rate %	Percentage of customers who have successfully repaid their first advance and have since taken out a second advance in the current financial year. The figures presented on Reuse Rate % are unaudited.
		Third Party Funding Costs % (of Advances)	Third party funding costs divided by total advances.
Share	A fully paid ordinary share in the capital of the Company.

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AI assistant

BEFOREPAY GROUP LIMITED — Interim / Quarterly Report 2024

64491_rns_2024-02-25_88b7bad1-6240-4627-b0a2-53c567b269ba.pdf

H1 FY24 Half Year Results Presentation 26 February 2024 Unaudited

Disclaimer

What we do

Ethical short-term finance[2]

Artificial-intelligence powered risk management

Designed to be affordable

Highly efficient automated platform

Designed for customer safety

Data at the core

Ethical lending

Awards we’ve won

Efficient platform; AI-powered risk management

Business Update

H1 FY24 Highlights

2.8%

96%

$31

H1 FY24 Highlights

Total and Average Advances

Incremental Growth in Advances

Active Users

235,644 Active Users or 16% Growth in H1 FY24

Declining Trend in Loan Defaults

Demonstrating Consistent Improvement in Credit Quality

Funding Costs – Debt Facility

Direct Service Costs

Continue to be Tightly Managed

Balance Sheet

Strong Cash and Equity Position

Cash Flow Statement

Operating, Investing and Financing Activities

Our Profitability Model

Our Profitability Model

NTM & Profit/(Loss) by Half Year

Strategy Update

Our strategy has been to achieve profitability in our core product and market

Q3 – Q4 FY22

Q1 – Q4 FY23

The addressable market continues to be significant…

…and we have strong competitive advantages to drive the next phase of our growth

Potential opportunities: Our risk capabilities and platform enable geographic and product expansion

Partner-based international expansion

Products

Our strategy – now and next steps

Replatform our business

What you’ll see when

FY24: Preparation and Build phase

Q&A

Thank You

Appendix

H1 FY24 Management Profit & Loss (P&L)

H1 FY24 NTM Reconciliation to Statutory P&L

Statutory Profit and Loss

H1 FY24 EBITDA Reconciliation to Statutory P&L

Statutory Profit and Loss

Glossary

Glossary

Glossary

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BEFOREPAY GROUP LIMITED Interim / Quarterly Report 2024