COUNT LIMITED — Annual Report 2012

Aug 22, 2012

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Full Year Results 23 August 2012

Barry Lambert - Chairman Michael Spurr - Managing Director & CEO

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Full Year Result Highlights

Financials Net Profit after Tax: $11.31 million (up 2 19%*) Net Profit after Tax attributable to shareholders: $11.21 million 3 Operating Result (EBITA): $19.22 million (up 7%)

• Normalised for non-cash fair value adjustments

CUP Dividends

12 cents declared and aid for 2011/12 p

First quarterly dividend for 2012/13 of 3 cents per share fully franked declared a ment date 15/11/12 ex-date 22/10/12 (p y ; )

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2

The Count lus Network p

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3

Group Performance – Member Firms

	2012 $ ‘000	2012 % of Total Revenue	% Change	Revenue made up of primarily of accounting services, financial planning services is 19% of total net revenue. Other Expenses include impact of new debtor provisioning policy
Total Net Member Revenue	90,242	100% 100%	11.28%
Expenses:
Salaries and Employment	(51,698)	(57.29%) (57.29%)
Premises	(5,240)	(5.81%) (5.81%)
Depreciation	(1,359)	(1.51%) (1.51%)
Other Expenses	(12,431)	(13.78%) (13.78%)
Total Expenses	(70,728)	(78.38%) (78.38%)	12.56%
Net Income Member Firms Net Income Member Firms	19,514 19,514	21.62% 21.62%	6.87% 6.87%
Net Contribution Margin (%)	22%

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Group Performance – Member Firms

				Head office contribution largely neutral Tax consolidation has resulted in lower expense for the year. Fair value adjustments significant in prior year
	2012 $ ‘000 ~~2012~~ $ ‘000	2012 % of Total ~~Revene~~ ~~2012~~ % of Total Revenue	% Change ~~%~~ Change
		~~u~~
Net Income Member Firms ~~Net Income Member Firms~~	19,514 ~~19,514~~	21.62% 21.6% ~~21.6%~~	6.87% 9% ~~6.9%~~
Head Office Contribution (net cost) ~~Head Office Contribution (net cost)~~	(297) ~~(297)~~	(0.33%)	(1.0%) ~~(1.0%)~~
EBITA Operating Profit (EBITA) ~~Operating Profit (EBITA)~~	19,217 ~~19,217~~	21.29% 21.3% ~~21.3%~~	7.00% % ~~7.0%~~
~~Interest Expense~~ ~~Interest Expense~~	~~(779)~~ ~~(779)~~	~~(086%)~~	~~(194%)~~ ~~(19.4%)~~
		~~.~~	~~.~~
Net Profit before Tax ~~Net Profit before Tax~~	18,438 ~~18,438~~	20.43% 20.4% ~~20.4%~~	8.50% % ~~8.5%~~
~~Tax Expense~~ ~~Tax Expense~~	~~(4800)~~ ~~(4,800)~~	~~532%~~	~~(104%)~~ ~~(10.4%)~~
	~~,~~	~~.~~	~~.~~
~~Cash Earnings~~ ~~Cash Earnings~~	~~13639~~ ~~13,639~~	~~1511%~~ ~~151%~~ ~~15.1%~~	~~1722%~~ ~~%~~ ~~17.2%~~
	~~,~~	~~.~~ ~~.~~	~~.~~
~~Amortisation Exense (net tax effect)~~ ~~nt x fft~~ ~~Amortisation Expense(net tax effect)~~	~~(2489)~~ ~~(2,489)~~	~~(276%)~~	~~84%~~ ~~8.4%~~
~~p~~ ~~e a eec)~~	~~,~~	~~.~~	~~.~~
Fair Value Uplift (net) Net Profit after Tax(ex fair vale adjust) ~~Net Profit after Tax(ex fair vale adjust)~~	161 11,150 ~~11,150~~	0.18% 12.4% ~~12.4%~~	19.4% ~~19.4%~~
Fair Value Adjustments (net tax) ~~Fair Value Adjustments (net tax)~~	161 ~~161~~		(95.5%) ~~(95.5%)~~
~~Net Profit after Tax~~	~~11,310~~	~~12.5%~~	~~(12.2%)~~

Head office contribution largely neutral Tax consolidation has resulted in lower expense for the year. Fair value adjustments significant in prior year

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5

Balance Sheet

	2012 $ ‘000	% Change
Current Assets	30,244	(0.5%)
Non-Current Assets	64,777	11.3%
Total Assets	95,021	7.3%
Current Liabilities	22,429	(22.4%)
Non-Current Liabilities	18,989	73.0%
Total Liabilities	41,418	3.8%
Net Assets	53,603	10.1%
Current Ratio	1.35
Total Loans and Borrowings	8,742
Net Debt	2,360

Balance sheet in strong position with net debt low and current ratio healthy Debt has increased due to new acquisitions payments and deferred payments Member Firms have good cash flow

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6

Results – Key Takeouts

• Acquisitions have contributed to revenue and expense growth

• Organic growth in both Accounting and Financial planning

• New debtor provisioning policy (additional $0.9m expensed as additional provision)

• New long service leave provisioning calculation (additional $0.6m expensed as additional provision)

• Financial planning revenue assisted by loyalty payments

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Results – Key Takeouts (continued)

• Tax consolidation has had positive impact on tax expense for this year only

• Amortisation expense (non-cash) relates to acquired client relationships and adviser network (intangible asset) arising on acquisition

• Large positive non-cash fair value adjustments in prior period

• NPAT growth 19% ex fair value items

• Net debt low

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SBS (QLD)
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Dividends

Dividends Paid	Cents Per Share	Paid
First Post Listing Dividend	4 cents	01/07/2011
2011 Final Dividend	2 cents	15/08/2011
1stInterim Dividend	3 cents	15/11/2011
2ndInterim Dividend	3 cents	15/02/2012
3rdInterim Dividend	3 cents	15/05/2012
2012 Final Dividend	3 cents	15/08/2012

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Full Franked Dividend Declared y

Dividend Declared Cents Per Ex-Dividend Record Payment Share Date Date Date

2013

3 cents 22/10/2012 26/10/12 15/11/12

1[st] Interim Dividend

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HMATP (Regional NSW)

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Benefits of Joining Countplus

What are the benefits to accountants and other financial services businesses of being part of Countplus?

• Diversify assets and grow at a listed multiple

• Provide financial support for business growth

• Long-term succession

• Enhance services range to client base

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Kidmans Partners (VIC)

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Recent Acquisitions

Date Ac uirer “Tuck-In” q Jul 2011 Countplus MBT Parramatta (Sydney, NSW) based (Sydney, NSW) chartered accounting & financial planning practice Loughhead Roberts Feb 2012 Kidmans Victorian based property & accounting (Melbourne, VIC) group Pacific East Coast Mar 2012 Beames & Assoc Regional NSW (Cooma) accounting firm (ACT) Apr 2012 Achieve Corp Melbourne based accounting & financial (ACT) planning business, Contract1

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Growth Acquisition Strategy

• Organic growth is priority

• Funding of acquisitions will predominately be funded from profits

• “Tuck-ins” by subsidiaries preferred

• Have begun marketing outside the Count group

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Evolution Advisers (NSW)

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Expanded Acquisition Policy

• Acquire minority stakes (30%+) in accounting/financial services businesses:

• Retiring partner

• Fund acquisition of fees

• Means of getting to know non-Count affiliated firms

• Performance benchmarks for Countplus to increase interest

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Future Growth

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Group Efficiency
- Member Firms learn from each other
Acquisition and develop best practice
- Cost synergies (limited)
- Carefully targeted
- Must be EPS accretive - Accounting franchise
- May take form of “tuck-ins” by existing
Members or minority stakes by group
“Bolt-on” acquisitions that complement core
accounting business
Organic (primary driver)
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• Firms acquired on basis of being capable of delivering continued organic growth

• Member Firms continue to run

independently of each other with -vendor principals retaining control

• Performance based equity rewards

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Accountants: High ratings for Ethics and Honesty

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Roy Morgan Research 2011 survey

16

Outlook

• First guidance to be reported at Annual General Meeting in November

• Preliminary estimates indicate good earnings per share growth for 2013

• First minority interest acquisition expected shortly

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17

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Full Year Results 23 August 2012

Barry Lambert - Chairman Michael Spurr - Managing Director & CEO

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