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Slovar Limited Investor Presentation 2021
17773_rns_2021-03-18_410ccb1c-d1ae-4d8f-9df9-5e89ec713802.pdf
Investor Presentation
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ASX: MNY
money3
NWR
Virtual Conference
19 March 2021
Scott Baldwin
Managing Director
Siva Subramani
Chief Financial Officer
About money3
Customer focused, Consumer & Commercial finance company
Strong brands across Australian and New Zealand
Ubiquitous customer journey from introducer to loan settlement – driven by proprietary technology with strong integration with introducers software
Diverse addressable market of new and used assets for consumers and commercial purposes – now funding over $30m of asset purchases a month
Strong Customer Care Culture managing the customer post settlement or post acquisition – Strong proprietary tech allows customer to transition to the Group seamlessly
The Market
Australia
- 20m vehicles
- Average age of 10.4 years
- Increasing by about 200k vehicles pa
- 60k active loans - 1/350 vehicles are funded by Money3
New Zealand
- 4m vehicles in
- Average age of 14.4 years
- Increasing over 2% pa over the last 10 years
- 8k active loans - 1/550 vehicles are funded by Go Car Finance
money3
Money3 Group - meeting the growing addressable market
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Non-conforming loans - Australia
- $381 loan book* (January 2021)
- Annual market opportunity - >$1bn¹ - used vehicle financing to sub prime applicants
- 1/450 registered vehicles in Australia funded by Money3
Products
- Automotive loans (consumer)
- Personal loans (consumer)
AUTOMOTIVE FINANCIAL SERVICES
Near prime Consumer & Commercial - Australia
- $47m loan book (January 2021)
- Annual market opportunity - $3bn¹ in used vehicle financing to near prime applicants
- Large annual market opportunity in new Consumer and commercial assets
- Less than 1% market share providing a huge opportunity to grow
Products
- Automotive loans (consumer)
- Automotive loans (commercial)
Go Car Finance
Goes way further
Near prime & non-conforming loans - New Zealand
- $122m loan book (January 2021)
- NZ$9.5b² annual motor vehicle sales
- Go Car Finance estimates it finances <1% of the total car market
- 1/700 vehicles funded by Go Car Finance
- Funding expansion in 2021
Products
- Automotive Loans (Consumer)
- Vehicle compliance & maintenance services
- Loan protection waivers
1 Money3 estimates 2 December 2020 Motor Fax published by the Financial Services Federation *includes GMFA acquisition loan book (acquisition completed 2 February 2021)
money3
Why the future for Money3 looks bright
Strong, sustainable profit growth for 20 years
- Strong direct presence after 30 years¹ in the market, large database with over 0.5m consumers
- 1 in 4 customers have borrowed from the group before, highlighting
- Strong presence with Dealers, embedded technology at the point of sale
- Strong presence with Brokers, Technology driving straight through processing from Brokers CRM to Money3 Credit process – A customer does not need to leave their mobile phone
- Products designed for people wanting to buy or maintain a vehicle (auto, leisure, marine and PL’s) – Online, through a dealer or by private sale
- Focused transport solution, smoothing costs of ownership – Repairs, Servicing, registration, Insurance
- Simple application process delivered through integration with partners
- Customer for life – Customers rewarded each time they return with improving rates and terms
- Exceptionally strong collections processes developed over 20 years
- Embedded technology in Dealer and Brokers business processes
- Simple proprietary application process, quick, simple and all from your hand held device
- 1 in 4 customers returning for a subsequent loan
money3
¹ Automotive Financial Services commenced trading in 1980's
Why the future for Money3 looks bright
Talented team
- Over 100 years of experience in Equipment and Asset finance in the executive team
- Strong alignment with shareholders with management holding over 10% of MNY equity
- All executives incentivised for long term profitable growth
Superior funding
- Over $300m of equity supporting existing loan book
- Backed by 3x large international banks with of over $350m of debt funding capacity
- Significant opportunity to increase group leverage
- Strong institutional backing – Last capital raise 2.5x over subscribed
- Over 4% improvement in funding costs going into FY22
Technology
- Simple application process – over 250k applications for finance pa and growing
- Embedded technology supporting introduction partners
- Propriety lending processes driving efficiency, supporting revenue growth in excess of opex
- Data mining improving credit algorithm every year
- Net Promotor Score of 76 (Money3)
money3
1 Automotive Financial Services commenced trading in 1980's
Strong loan book growth
Strong book growth via organic growth and acquisition at start 2H, providing a solid foundation for underpin FY22 results
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Highlights - 1H FY21
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Revenue increased 8.3% to $67.9m on pcp
EBITDA increased 32.8% to $40.5m on pcp
NPAT increased 26.8% to $19.9m on pcp
Strong positive cashflow impact from government stimulus to customers
Approximately 3% of customers reduced payments due to COVID19 - minimal impact on cashflows
1H Bad debts were significantly under expectation - no impairment provision release until Q4
Strong growth despite Victorian lockdown and early Superannuation release reduced finance demand for vehicles in 1H
Strong NZ loan book growth in 1H and post lockdown momentum building in AU
New loan originations (cash advanced) 9.3% increase on pcp
Loan book increased 11.1% on pcp, 9.3% increase since June 30
Cash collected increased 23.6% on pcp, contributed to marginal growth in loan book
8
FY21 - Outlook
Forecast NPAT $36m
- FY21 forecast takes into consideration the continuing uncertainty around COVID-19 with the following assumptions;
- No prolonged lockdowns occurring in the reminder of the financial year;
- Stability in unemployment rates;
- Announced Government stimulus packages remaining in place until March 2021; and
- Anticipate paying 9 cents in dividends for FY21.
Target Loan book ~$600m by end of FY21
- Strong loan book growth and significant improvement in the cost of debt will provide the foundation a significant uplift in NPAT and ROE
Continue to pursue strategic acquisitions to add scale in terms of product or distribution channels
money3
Managing Director
Scott Baldwin
Telephone: +61 3 9093 8255
Email: [email protected]
Chief Financial Officer
Siva Subramani
Telephone: +61 3 9093 8246
Email: [email protected]
Investor Relations
Simon Hinsley
Telephone: +61 401 809 653
Email: [email protected]
Footnotes
Motor Vehicle Census, Australia, 31 Jan 2020 | Australian Bureau of Statistics (abs.gov.au)
Fleet statistics | Ministry of Transport
Fleet statistics | Ministry of Transport Annual Fleet Statistics.pdf (transport.govt.nz)