m2 group macquarie conference presentation 20140509 · increases in all key measures" revenue...
TRANSCRIPT
M2 Group LtdMacquarie Australia Conference"9 May 2014!
Geoff Horth, CEO!
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Presentation Content"
• Record 1H14 Performance"• Record Organic Growth"• More of the same in 2H14"
Slide 2, 9 May 2014"
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Record 1H14 Performance"
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Increases in all key measures"
Revenue UP 66% to $506 million EBITDA UP 38% to $75.8 million NPAT UP 26% to $30.9 million NPAT (underlying1) UP 38% to $43.8 million
1) Underlying NPAT includes an add-back of a non-cash cost of $12.9 million for amortisation ($7.0 million in previous corresponding period) associated with customer contracts acquired in the relevant period (in accordance with Australian Accounting Standards)
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Revenue NPAT EBITDA
Slide 4, 9 May 2014"
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Continuing to grow Shareholder Returns"
› Dividend declared at 11.5 cents per share, fully franked
› Total dividend payable (including DRP) $20.6 million, up by $4.8 million or 30% on pcp
› EPS up 10% to 17.3 cents per share
› EPS underlying up 21% to 24.5 cents per share
1) Underlying EPS includes an add-back of a non-cash cost of $12.9 million for amortisation ($7.0 million in previous corresponding period) associated with customer contracts acquired in the relevant period (in accordance with Australian Accounting Standards) 2) Calculated using the volume weighted average number of shares"
EPS Underlying EPS Dividend
Slide 5, 9 May 2014"
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Record Organic Growth"
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Record Organic Growth"
Total services in operation up 50,000 from 30 June 2013 More than 1.5M post paid services in operation at 31 Dec 2013
Total services 30 June 2013 (000’s)
Total services 31 Dec 2013 (000’s)
Fixed voice
Mobile
Energy
23,000 services
25,000 services
Broadband 39,000 services
13,000 services
Slide 7, 9 May 2014"
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The new Commander Phone"The full-featured hosted small business communication solution
Slide 8, 9 May 2014"
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Commander Phone features"
Slide 9, 9 May 2014"
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Post-launch update: Commander Phone"
› Commander Phone launched March 2014
› Orders exceeding expectation
› Average of 4 handsets per sale
› 45% ordering dedicated broadband – not just ‘over the top’ sales
› 98% of sales have been from new customers
› 86% of those sales generated by dealer channel
› Most customers select a contract of 36 months
Slide 10, 9 May 2014"
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Post-launch update: 4G Mobile"› Refreshed 4G Mobile Broadband plans launched February 2014
› Refreshed 4G Mobile plans launched August 2013
› Improving trends seen month-on-month
› 39% growth in mobile sales in last 3 months (compared with prior 3 months) Total M2 Group Mobile sales"
Slide 11, 9 May 2014"
Nov Dec Jan Feb Mar Apr
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Commander Electricity"› Launched March 2014
› Dealer channel to move from lead generation to direct sales in May
› Extending marketing in June 2014, introducing “Above The Line” campaign
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More of the same in FY14"
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Summary"
› Strong organic growth trajectory continued into Q3
› Continued focus on integration plans and synergies
› Earnings driven by margin growth and cost reduction
› Internal focus on cash; expect normalised cash flow in H2
› Continued focus on M&A
Slide 14, 9 May 2014"
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$M" FY13(a)" FY14 Guidance" % Change "(from midpoint)"
Revenue" 681.0" 970 - 1030" Up 47% "
EBITDA" 108.1" 150 - 170" Up 48%"
NPAT" 43.8" 60 - 70" Up 48%"
NPAT (underlying1)" 58.4" 85 - 95" Up 54%"
EPS (cents per share2)" 27.4" 34 - 39" Up 33%"
EPS (cents per share, underlying1,2)" 36.3" 48 - 53" Up 39%"
Capex (as % of revenue)" 2.9%" 2%" Down 31%"
FY14 Guidance"
(1) Underlying NPAT and EPS figures each include an add-back of a non-cash cost of $14.6 million for FY13 and $26 million for FY14 for amortisation associated with customer contracts acquired in the relevant period (in accordance with Australian Accounting Standards) "(2) Calculated using the volume weighted average number of shares"
Slide 15, 9 May 2014"
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Number of Shares on issue" 180,398,183"
Share Price" $5.58"
Market Capitalisation" $1 billion"
Dividend Policy" 70% NPAT"
Interim FY14 Dividend" 11.5c per share, ff"
@ 7 May 2014"Key Investment Metrics"
Slide 16, 9 May 2014"
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Certain statements made in this presentation are forward-looking statements. These forward-looking statements are not historical facts but rather are based on M2’s current expectations, estimates and projections about the industry in which M2 operates, and its beliefs and assumptions. ""Words such as "anticipates," "expects," "intends," "plans," "believes," "seeks,” "estimates,“ “guidance” and similar expressions are intended to identify forward-looking statements. ""These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors, some of which are beyond the control of M2, are difficult to predict and could cause actual results to differ materially from those expressed or forecasted in the forward-looking statements. ""M2 cautions shareholders and prospective shareholders not to place undue reliance on these forward-looking statements, which reflect the view of M2 only as of the date of this presentation. The forward-looking statements made in this presentation relate only to events as of the date on which the statements are made. ""M2 will not undertake any obligation to release publicly any revisions or updates to these forward-looking statements to reflect events, circumstances or unanticipated events occurring after the date of this presentation except as required by law or by any appropriate regulatory authority."
Disclaimer"
Slide 17, 9 May 2014"
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