FY16 Results Presentation

Returning FXL to Profitable Organic Growth Symon Brewis-Weston

Chief Executive Officer

David Stevens

Chief Financial Officer

30 August 2016

1

FXL Key Questions Key Question FXL view

  • Rebuilding Commercial finance offer

Can FXL deliver organic earnings growth?

Can the Point of Sale Lease product be reinvigorated?

How quickly can the Commercial finance offer in the market be fixed?

  • Ireland presents significant market opportunity

  • Achieving scale in Australian cards business and expand scope to capture current point of sale trends

  • Leverage new technologies through Oxipay and Kikka

  • Product redesign ongoing to match demographic changes in technology and ownership models

  • Value proposition rebuilt and offer in market

  • Number of new merchant partnerships signed

  • Pipeline of new business growing significantly

    What is the outlook on impairment

    losses?

    Can the run rate of capex spend be reduced?

    Can the overall Return on Equity be

    maintained?

    Will FXL continue to consider M&A as a growth strategy?

  • Marginal increase expected as credit cycle shifts

  • Underwriting rigour being enhanced via technology

  • Move to cloud based technology solutions will allow reduction in ongoing capex spend

  • Increased rigour being applied to capex prioritisation

  • Non-core businesses being divested or run-down

  • Re-shaping of profit pool from leasing to cards will step down ROE but improve earnings sustainability

  • Opportunities considered if deemed right fit for FXL,

    i.e. value accretive and in relevant adjacencies

  • However, key focus remains profitable organic growth

2

FY16 Highlights

FY16 Cash NPAT $97.0m solid result in line with expectation

Significant growth momentum achieved in Cards business with further major contract signed with Flight Centre Group

Entered NZ Cards market through strategic acquisition of Fisher & Paykel Finance - integration on track and beginning to deliver expected growth and synergies

Recycling capital out of discontinued non-core businesses and now repositioned for profitable organic growth

Rebuild of Commercial finance business tracking ahead of expectations

3

Notes:

1. Cash NPAT excludes amortisation of acquired intangibles $3.7m (FY15: $3m), deal acquisition costs $5.6m (FY15: $1.9m), impairment of TOT goodwill $8.5m, fixed assets written off $12.3m and additional receivables provisioning $16.7m. FY15 also excludes a one off residual value loss in Enterprise business of $2.5m.

2. ROE and Cash EPS in FY16 impacted by timing lag between capital raised in Nov-15 (22% of issued share capital) and FPF acquisition completed in Mar-16

FXL Highlights Transformational acquisition of FPF completed taking portfolio above $2bn

FlexiGroup ($m)

FY15

FY16

Growth v PCP

Cash NPAT 1

90.1

97.0

8%

Statutory NPAT

82.7

50.2

(39%)

Volume

1,136

1,350

19%

Closing Receivables

1,428

2,094

47%

Cash Flow from Operating Activities

121.2

147.4

22%

ROE % 2

23%

19%

(4%)

Cash Earnings per Share (cents) 2

28.7

28.0

(2%)

4

Flexigroup Limited published this content on 30 August 2016 and is solely responsible for the information contained herein.
Distributed by Public, unedited and unaltered, on 30 August 2016 00:43:08 UTC.

Original documenthttp://news.iguana2.com/flexirent/ASX/FXL/969190

Public permalinkhttp://www.publicnow.com/view/C987B7734DC0CC1D3A27AFE8105BD25C76C06043