McMillan Shakespeare : Half Yearly Report and Accounts

22 February 2017

Manager Company Announcements ASX Limited

Dear Sir/Madam

Please find attached the Appendix 4D Half-year Report, Directors' Report, the Financial Report and Auditor's Independent Review Report for the half-year ended 31 December 2016.

This information should be read in conjunction with McMillan Shakespeare Limited's 2016 Annual Report.

This announcement comprises the information required by ASX Listing Rule 4.2A and the statement required by Rule 4.2C.2.

Yours faithfully

McMillan Shakespeare Limited

Mark Blackburn

Chief Financial Officer and Company Secretary

McMillan Shakespeare Limited

Interim Financial Statements and Appendix 4D

Half-year ended 31 December 2016

1. Details of the reporting period and the previous corresponding period

   Current period: 1 July 2016 to 31 December 2016

   Previous corresponding period: 1 July 2015 to 31 December 2015

2. Results for announcement to the market

   Percentage Key information change		Half-Year ended 31 December 2016 $'000
   Revenues from ordinary activities	Up 3% to	251,254
   Profit after income tax	Up 4% to	40,424
   Net profit after income tax attributable to members of the parent entity	Up 4% to	40,424

   2.1

   2.2

   2.3

   Amount per share Dividends		Franked amount per share
   Interim dividend	$0.31	$0.31
   Ex-dividend date	30 March 2017
   Record date for determining entitlements to the dividend	31 March 2017
   Dividend payment date	13 April 2017

   2.4

   2.5

   2.6 Commentary on results for the financial year

   Underlying Net Profit After Tax and Acquisition Amortisation (UNPATA), being net profit after tax but before the after-tax impact of acquisition-related transaction expenses and the amortisation of acquired intangible assets, has been used to measure the financial performance of the Group.

   The Company believes this measure of performance best represents the core financial results of

   the Group's operations for the half-year ended 31 December 2016. UNPATA has been calculated from NPAT as reported in item 2.2 above, as follows.

   Half-year 31 Dec 2016	Half-year 31 Dec 2015
   Profit after income tax (item 2.2)	$'000	$'000
   	40,424	38,935
   Amortisation of acquired intangible assets after tax	1,217	1,159
   Acquisition transaction costs after tax	474	1,699
   UNPATA	42,115	41,793

   Group UNPATA for the half-year ended 31 December 2016 of $42.1m was 1% higher than the previous corresponding period (pcp) of $41.8m. The Asset Management segment was 19% higher than the pcp. The Group Remuneration Services segment was steady notwithstanding a change in the arrangement with a major client. The Retail Financial Services segment was 14% lower than pcp notwithstanding the growth in net amount financed. This reduction in UNPATA was largely due to a change in the mix of financing and uncertainty regarding potential regulatory changes.

   The financial operating performance of the segments is summarised below.

   Half-year 31 Dec 2016	Half-year 31 Dec 2015	Half-year 31 Dec 2016	Half-year 31 Dec 2015
   Revenue	Revenue	UNPATA	UNPATA
   Group Remuneration Services	$'000	$'000	$'000	$'000
   	90,522	91,416	28,244	28,319
   Asset Management	104,017	97,428	8,223	6,919
   Retail Financial Services	55,897	54,642	6,151	7,117
   Total segment operations	250,436	243,486	42,618	42,355
   Unallocated public company costs and net interest			(503)	(562)
   UNPATA	42,115	41,793

   Basic earnings per share as shown in the financial statements was 48.59 cents per share (1H16: 47.10 cents per share) and on a diluted basis was 48.47 cents per share (1H16: 47.00 cents per share).

   Please refer to the accompanying December 2016 Half-year Results Announcement for more details on the financial results.

3. Net tangible assets per share

   31 Dec 2016	30 Jun 2016
   Ordinary shares	$1.47	$1.39

4. Control gained or lost over entities during the period