SHINE JUSTICE LTD — Investor Presentation 2021

Feb 23, 2021

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24 February 2021

Shine Justice Ltd (SHJ) FY21 Half Year Results Investor Presentation

Attached is a copy of the FY21 Half Year Results Investor Presentation.

Authorised for release by the Board

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Annette O’Hara Company Secretary Shine Justice Ltd Tel: 07 3837 9448 aohara@shine.com.au

For more information

Simon Morrison, Managing Director & CEO - Shine Justice Ltd 07 3837 9435 Ravin Raj, Chief Financial Officer - Shine Justice Ltd 07 3006 6050

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Shine Justice Ltd

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Half Year Results

Investor Presentation February 2021

Simon Morrison MANAGING DIRECTOR & CEO

Ravin Raj CHIEF FINANCIAL OFFICER

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Important Notice

This presentation contains certain forward-looking statements with respect to the financial condition, results of operations and business of Shine Justice Ltd and certain plans and objectives of the management of Shine Justice Ltd. Such forward-looking statements involve both known and unknown risks, uncertainties, assumptions and other important factors which are beyond the control of Shine Justice Ltd and could cause the actual outcomes to be materially different from the events or results expressed or implied by such statements. Shine Justice Ltd and none of its officers, advisers or any other person makes any representation, assurance or guarantee as to the accuracy or likelihood of fulfilment of any forward looking statements or any outcomes expressed or implied by any forward looking statements.

The information contained in this presentation does not take into account investment objectives, financial situation or particular needs. Before making an investment decision, investors should consider their own needs and situation and, if necessary, seek professional advice. To the maximum extent permitted by law, none of Shine Justice Ltd, its directors, employees or agents, nor any other person accepts any liability for any loss arising from the use of this presentation or its contents or otherwise arising out of, or in connection with it.

FY21 H1 Results Presentation | ABN 93 162 817 905 | 2

Shine Justice One Unifying Message

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Personal Injury

(motor vehicle, workplace, public liability – lean, standard, major claims)

• Shine Lawyers

• Sciacca’s (QLD)

• Stephen Browne (WA)

• Bradley Bayly (WA)

• Claimify

Land, Energy & Resources

• Shine Lawyers

New Practice Areas

• Class actions

• Professional and medical negligence

• Employment Law

• Commercial Litigation

• Superannuation and disability

• Abuse law

Family Law

• Best Wilson Buckley Family Law (QLD)

• Carr & Co (WA)

Loss Adjustment

• Risk Worldwide (NZ)

• My Insurance Claim (NZ)

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• Emanate Legal Services (QLD)

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Agenda

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FY21 H1 Highlights

2021 Strategic Priorities and Outlook

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FY21 H1 Financial Results

Questions

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Investing in Shine Justice & Operating Environment

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Responding to COVID-19…

Our People, Clients and Community

Despite uncertainty in short term outlook, our core fundamentals remain unchanged

Our People

• Throughout the pandemic, the health and safety of our people has been our highest priority

• Successfully initiated transitional working from home arrangements

• • Maintained workforce to support our operations and client service standards

• • Successful navigation and management of COVID restrictions ensured minimal effect on client services

Our Operations

Our Clients

• •

• Delivered uninterrupted Developed new ways service to our clients to connect with and serve clients

• • Improved remote •

• working capability Branch operations are returning to full operational capacity in line with health protocols

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Highlights

Simon Morrison Managing Director & CEO

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$93.57m $10.05m $24.29m $33.91m
+4.6% +13.9% +12.1% +324.4%
Revenue NPAT EBITDAI [1] GOCF [1]
2.00¢ 5.80¢
Key Financial +33.3% +14.2%
Interim Dividend EPS
Metrics
(unfranked) (basic)
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1 EBITDAI and GOCF are not IFRS calculations which appear in the financial statements, and have not been audited.

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• Half year result reflects resilient nature of business and demonstrated growth despite macroeconomic uncertainty and Covid-19

• FY21 priorities underpin growth and profitability post pandemic

• Underlying profit in line with guidance expectations despite Covid headwinds

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in Review

• Continue to monitor future government responses and economic conditions

• Pipeline of organic and acquisitive opportunities emerging in core markets

• Continue to balance opportunities with disciplined investment and working capital strategies

• Solid momentum as we continue to invest in technology and innovation in FY21

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Financial Results

Ravin Raj Chief Financial Officer

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Financial Results

Detailed Profit and Loss

	FY21 H1	FY20 H1	Variance	Variance
	($m)	($m)	($m)	(%)
Revenue	93.57	89.44	+4.13	+4.6
NPAT	10.05	8.83	+1.22	+13.9
EBITDAI1	24.29	21.67	+2.62	+12.1
Employee Benefits Expense	49.96	46.25	+3.71	+8.0
Overheads	29.02	30.46	-1.44	-4.7

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¹ EBITDAI is not an IFRS calculation which appear in the financial statements, and have not been audited.

FY21 H1 Results Presentation | ABN 93 162 817 905 | 10

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Financial Results

Financial Highlights

	FY21 H1	FY20 H1	Variance
	($m)	($m)	(%)
EPS (basic) (cents)	5.80	5.08	+14.2
Interim dividend per share (cents)	2.00	1.50	+33.3

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Financial Results

Balance Sheet

Growth in EPS due to improved profitability AS AT ($’000) 31	Growth in EPS due to improved profitability AS AT ($’000) 31	Dec 20		30	June 20
Cash		49,515			32,812
Receivables		18,951			12,404
~~Interim dividend increased as business continues to improve~~ Contract assets - work in progress 287,797					305,102
Income tax receivable		-			322
~~Dividends unfranked~~ Unbilled disbursements at fair value Other financial assets at amortised cost		95,618 4,891			89,268 4,698
PP&E and other		6,221			6,217
Intangibles		49,153			48,949
Right of use assets		37,400			40,647
Total assets		549,546			540,419
Trade payables		16,091			16,020
Disbursement creditors		86,968			83,644
Borrowings		50,721			52,499
Lease liabilities		45,584			48,447
Deferred and current tax liabilities		96,269			91,864
Employee benefit obligations		9,038			8,912
Provisions		1,697			1,659
Financial liabilities		192			154
Total liabilities		306,560			303,199
Net assets		242,986			237,220

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FY21 H1 Financial Results

Gross Operating Cash Flow

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(1,3)
(1)
(1,2)
(1,2)
(1)
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• 1 From FY19, the GOCF result improved through adoption of AASB 16

2 The FY20 cashflows relating to disbursement funding have been reclassified to be consistent with the current year presentation

• 3 GOCF includes Mesh class action cash of $22.9 million

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FY21 H1 Financial Results Shine Cash Funded Disbursements (Net)

Shine Equity Funded Disbursements (Net)

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• Cash flow improvement strategy commenced FY17 to secure:

• Long term disbursement funder

• Litigation funding of all new Class Actions

• Return of significant Shine equity funds back into the business

• Medium term aim to improve GOCF to 65 - 75% of EBITDAI on track

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Investing in Shine Justice & Operating Environment

Simon Morrison Managing Director & CEO

FY21 H1 Results Presentation | ABN 93 162 817 905 | 15

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Our Points of Difference

Strong financial model

• Strong Balance Sheet

• Consistent growth rate > 40 years

• Consistent attractive dividends

Sustainable growth

• Trusted brand leader (Australia and NZ)

• Proven track record

• Second largest plaintiff litigation firm in Australia

• There will always be injustice in the world

Capabilities

• World class technology partners

• The Shine Justice Way

• Leadership

• Deep knowledge and experience

• Innovation

• Capital discipline

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Diversified technologies for scale to support long term strategy

Deliver end-to-end Industry trends confirm our Build momentum automation across every strategy and approach Smart engagement line of business

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• Simplified assisted on-boarding process

• Easy integration into content management system

• Improve conversion rate and customer experience

• Direct client to branch

• Enable customers to initiate claim 24/7

• Matter management

• Financial management

• Business development

• Risk management

• Solutions to facilitate automation

• Online legal platform with a focus on ease and convenience for the client and internal process optimization

• Artificial intelligence deep learning algorithm that predicts case outcomes

• Online claims portal

• Fixed pricing model

Our strategic partnerships to enhance customer experience

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Class Actions – Federal Inquiry

Litigation funding and class actions report recommendations*

• Increased disclosure obligations on funders and law firms

• Court approval of litigation funding agreement to be enforceable

• Adopt 'measured and steady' approach to contingency fees

• Apply financial services regulation to lawyers operating on a contingency fee basis imposed by the AFSL and MIS regimes

• Temporary changes of continuous disclosure regime be made permanent

• Federal Court to resolve competing / multiple class actions

• Review of statutory minimum return to group members

Business Interruption Insurance

High Court Appeal

• Business interruption (BI) insurance during pandemic

• The December 2020 Parliamentary Joint Committee’s report contains recommendations and not legislation. Further updates on legislative and policy developments will be provided in 2021-2022

FY21 H1 Results Presentation | ABN 93 162 817 905 | 18

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2021 Strategic Priorities and Outlook

Shine Justice is a long-term growthoriented business well positioned to increase market share across our diversified services

FY21 H1 Results Presentation | ABN 93 162 817 905 | 19

• •

• Pursue strategic and value Maintain strong capital accretive opportunities in PI management and Class Actions with • Deliver strong cashflow

• disciplined acquisition metrics

• Deliver strong cashflow

• Developing new operating model

• Market consolidation opportunities

• Improvements to branch network and grow market share in existing service lines

• Exploring new service offerings

• Continue to invest in innovative solutions and opportunities that enhance our efficiency and resilience

• Align innovation with key opportunities across the business

• Broaden client offerings, utilise digital platforms

• Improve the customer experience

• Deliver FY21 priorities to position for growth and profitability

Expected continuation of EBITDAI growth in FY21 in the order of a high single digit percentage Guidance increase, subject to unforeseen COVID-19 impacts

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Questions

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Appendices

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Aged over 55
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26.0% Aged under 35
34.2%
39.8%
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Aged 35 to 54
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Social Impact

Social and physical initiatives to improve well being and mental illness.

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Actively supporting schools and sporting organisations as part of promoting health and wellness and community spirit.

Shine A Light

Shine A Light Foundation supports charitable organisations that promote prevention, rehabilitation, education and safety programs for people impacted by injury, injustice and adversity.

Energy & Climate

Energy efficiency and alternative sources to minimise our footprint.