Slovar Limited — Investor Presentation 2021

Aug 16, 2021

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Financial Year
2021 Presentation
17th August 2021

Accelerating Profitable Growth

Scott Baldwin
Managing Director

Siva Subramani
Chief Financial Officer

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FY21 Highlights Accelerating Profitable Growth

| EBITDA^{1}
64.8%
to $80.9m | Loan book
38.5%
to $601.0m | NPAT^{1}
76.6%
to $39.2m | $170m in
available funds
(available cash & debt) | Revenue
17.0%
to $145.1m |
| --- | --- | --- | --- | --- |
| EPS^{1}
64.3%
to 19.85 cents | ROE
13.4%
pcp 9.9% | Final Dividend
7.0 cents
(Fully Franked) Taking full
year dividend to 10 cents | Successfully
completed two
acquisitions driving
loan book and
product growth | Successfully
secured AU$388m
in new debt
funding from three
banks |

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represents results from continuing operations

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Money3 Group – Our Business units

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Consumer loans - Australia

AUTOMOTIVE FINANCIAL SERVICES

Consumer & Commercial loans

Australia

Go Car Finance

Goes way further

Consumer loans - New Zealand

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Continuing to deliver profitable growth

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Loan book – a diversified portfolio of customers

| ~63,000
Loans in the portfolio | 50,000+
Consumer – Auto Loans | ~500
Commercial – Auto Loans | ~12,500
Personal Loans | 1,000+
New Vehicles in Portfolio |
| --- | --- | --- | --- | --- |
| | | | | |
| | | | | |

Note: Asset numbers includes vehicles taken as security for a personal loan.

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Money3 Group – A history of profitable growth

Group has financed over AU$2.0 Billion of vehicles

In FY22 Group will exceed AU$1.0 Billion in Revenue (cumulative history)

Over 60,000 active customers

Industry leading Customer Care teams

Australia over 150,000 vehicles funded

New Zealand over 20,000 vehicles funded

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FY21 - Financial Performance

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FY21 Financial Results

| Group Financial Results
Amounts in $m unless otherwise stated | FY21
(Statutory) | FY20
(Statutory) | Mvt % |
| --- | --- | --- | --- |
| Revenue | 145.1 | 124.0 | 17.0% |
| Impairment expenses and losses | (19.1) | (38.0) | (49.7%) |
| Expenses | (45.1) | (36.9) | 22.2% |
| EBITDA | 80.9 | 49.1 | 64.8% |
| EBITDA Margin | 55.8% | 39.6% | |
| NPAT^{1} | 39.2 | 22.2 | 76.6% |
| NPAT^{1} Margin | 27.0% | 17.9% | |
| EPS^{1} – Basic (cents per share) | 19.85 | 12.08 | 64.3% |
| Average Loan Book^{2} | 535.5 | 404.0 | 32.5% |
| Debt drawn | 262.3 | 173.7 | |
| Leverage (Loan Book) | 50.0% | 43.0% | |

76.6%

Increase in

NPAT

(Continuing operations)

64.8%

Increase in

EBITDA

17.0%

Increase in

Revenue

13.4%

Return on Equity

(RoE)

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1Continuing operations

2Adjusted for acquisitions in FY21

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Diversified funding base (as of release date)

Multiple Banks supporting the Group's profitable growth

$423m in debt facilities available from multiple banks
(as of release date)

Lifting Group leverage to drive RoE growth in FY22

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Credit Quality - Improving year on year

Improving Credit quality

• Strong
• Good
• Watch list
• Sub-standard
• Credit impaired

Also refer to page 70 in the FY21 Annual Report

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"Strong and Good" rated loans has improved year on year, increasing to 83% from 79% in FY21

Impairment provision % decreasing with improved credit quality

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FY21 - Operational Performance

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Money3 Group – Business units

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Consumer loans - Australia

• Strong new lending growth in 2H FY21, up 39.9% on pcp
• Refinanced debt funding facility driving down cost of funding by 4% when fully drawn
• Digital initiatives simplifying customer interaction increasing returning customers

• Strong growth in demand for products post lockdowns

• Industry leading Customer care teams

• Well positioned to leverage new Credit Suisse securitised warehouse funding facility to drive down funding cost and expand market share

Consumer & Commercial - Australia

• Acquired AF5 in January 2021
• Strong strategic & cultural fit to broaden addressable market
• ~400% increase in new loan origination in the first six months of operation in the Group

• Doubled securitised warehouse funding facility to drive growth in near-prime automotive segment

• Strong market demand for product

• Leveraging established Money3 distribution network
• Introduces established commercial lending operations to the Group

Go Car Finance

Goes way further

Consumer loans – New Zealand

• Acquired GCF in March 2019
• Exceptionally strong cultural fit with Group, loan book growth of over 300% since acquisition to AU$158m
• Strong new customer and loan growth, up over 90% in FY21 on pcp

• 49.9% increase in revenue in FY21 over pcp

• Leveraging Group resources and strong balance sheet driving profitable growth

• Expanding distribution network

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Group - Strong growth in originations

• 18.0%
  Avg loan size increase by 18.0% to $13k over pcp

• 39.9%
  Increase in 2H cash advanced over pcp
  Full year cash advanced of $223.5m, 1H increase was 9% over pcp

• 120.8%
  Increase in New Zealand cash advanced to $117.0m over pcp

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Group - Strong growth in cash collections

Cash Collected

*adjusted for acquisition period

• 20.4%
  Increase in Australian cash collections to $285.4m over pcp

• 56.9%
  Increase in New Zealand collections to $63.4m over pcp

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Customer Experience

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Technology – the future state in managing the life cycle of your vehicle

Continual development of the user experience

• Apply for a loan from your mobile device
• Manage your payments from your mobile device
• Know where you left your car and move alerts
• Service reminders – based on usage, delivered to your mobile device
• Arrange a service
• Alerts should your vehicle insurance expire
• Arrange your Warrant of Fitness (Roadworthy certificate) assessment
• Keep your car registered
• Subscribe additional cars without finance attached

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Digitising the customer experience

Self service from your mobile device

Moving with customer expectation to a mobile digital experience

Streamlined application and self-service capabilities

• Designed for an all mobile digital experience available 24/7
• Tasks without staff intervention, providing a rich digital experience
• Quick web & mobile digital application
• Web chat
• Account overview
• Simplified payments management, including one off and catchup payment capabilities

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Outlook

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Strategy and Outlook

Industry Outlook

• Expect to see improving vehicle supply in new and used vehicles
• Continuing large bank contraction in the sector favouring non-bank lenders
• Growing demand from consumers to buy an asset due to restricted travel
• Expect Government stimulus softening with continuing consumer affordability

FY22 Financial

• Strong growth momentum in the business driving growth in revenue and profitability in line with analyst consensus
• Accelerated Cash collections to trend back to normal levels favouring loan book growth to $760 - $810 million
• Growth funded by four diversified banks, support by existing Group equity
• Return on Equity continues to improve toward 15% as leverage increases through the year

Company Outlook

• Leverage existing distribution strategy to continue taking market share
• Accelerate expansion in the Digital online consumer channel
• Leverage technology to improve customer experience
• Launch commercial lending program
• Distribution expansion across New Zealand
• Pursue acquisition of similar lending businesses

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Appendix 1 – Corporate Information

CAPITAL STRUCTURE

ASX 300 Company
Shares on issue	208.7 million
Share Price (13th August 2021)	$3.40
Market capitalisation	$709.5 million
Return on Equity	13.4%
Earnings per share	19.85 cents
Dividends per share (final)	7.00 cents

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Disclaimer

The content of this presentation has been prepared by Money3 Corporation Limited (the Company) for general information purposes only.

Any recommendations given are general and do not take into account your personal circumstances and therefore are not to be taken as a recommendation or advice to you.

You should decide whether to contact your financial adviser so a full and complete analysis can be made in respect to your personal situation.

Whilst all care has been taken compiling this presentation neither the Company nor any of its related parties, employees or directors give any warranty with respect to the information provided or accept any liability to any person who relies on it.

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Investor Relations
Simon Hinsley
Mobile: +61 401 809 653
Email: simon@nwrcommunications.com.au

Managing Director
Scott Baldwin
Telephone: +61 3 9093 8255
Email: s.baldwin@money3.com.au

Chief Financial Officer
Siva Subramani
Telephone: +61 3 9093 8255
Email: s.subramani@money3.com.au

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AIS AUTOMOTIVE FINANCIAL SERVICES
Go Car Finance
Goes way further