Computershare Limited Full Year Results 2006 Presentation Chris - PowerPoint PPT Presentation

Computershare Limited Full Year Results 2006 Presentation Chris Morris Tom Honan 1 6 August 2 0 0 6

CEO’s Report Financial Results I ntroduction 2

Introduction Chief Financial Officer Tom Honan 3

Introduction Summary of Results Management EPS of 30.44 cents, up 41% › Management Net Profit After OEI of A$181.4m, up 49% › Total Revenue of A$1,626.1m, up 50% › Operating Cash Flows of A$245.8m, up 67% › Operating Costs of A$1,309.0m, a 50% increase › Days Sales Outstanding at 54 days, down 8 days › Final Dividend of 7 cents per share. › 4

Introduction CPU Revenues continue to diversify Revenue Type 4% 9% 5% Register Maintenance Corporate Actions Stakeholder Relationship Management 8% Employee Share Plans Document Services 50% Fund Services Technology & Other Revenue 8% 16% 5

Global Equities Market Introduction Historical Equity Issuance Data Annual M & A Book to Bill Ratio 4000 35000 1.8 3500 30000 1.5 3000 25000 $ Billions 2500 20000 1.3 2000 15000 1500 10000 1.0 1000 5000 500 0.8 0 0 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006E 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006E Book-to-bill ratio Average Global Completed M&A Volume (la) Total Completed M&A Transactions (ra) 2006 YTD 1.47x 2006 YTD vs. 2000 - 2005 Avg 38.7% 2006 YTD Total Volume 1,412bn 2006 Est. Annualised Volume: 2,421bn 2000-2005 Average 1.06x 2006 YTD vs. 1991 - 2005 Avg. 30.5% 2005 Total Volume 2,108bn Est. 2006 vs. 2005: 14.8% 1991-2005 Average 1,429bn Est. 2006 vs. 1991- 2005 Avg: 69.4% 1991-2005 Average 1.13x Source: SDC Thomson Financial and UBS Securities Australia Ltd 6

Global I nterest Rate Market Introduction % % UK US 8 8 6 6 4 4 2 2 0 0 2000 2001 2002 2003 2004 2005 2006 2000 2001 2002 2003 2004 2005 2006 % Canada 8 6 4 2 0 2000 2001 2002 2003 2004 2005 2006 7

Introduction Computershare Strengths Recurring Revenue – 70% of revenue is of a recurring nature › Global Diversification – Across 17 countries › Exposure to northern hemisphere interest rates › Technological innovation and capabilities – enhanced by acquisitions › I ntegration of businesses – Equiserve ahead of schedule › Continued strong EPS growth. › 8

CEO’s Report Financial Results I ntroduction 9

Financial Group Financial Performance – A$m Results AI FRS AI FRS Variance FY06 FY05 Sales Revenue 1,604.1 1,057.7 52% Interest & Other Income 22.0 25.5 Total Revenue 1,626.1 1,083.2 50% Operating Costs 1,309.0 873.1 (50% ) Share of Net (Profit)/Loss of Associates (4.2) (1.8) Management EBI TDA 321.3 211.9 52% Management Adjustments - Revenue/(Expense) (2.4) (12.7) Reported EBI TDA 318.9 199.2 60% 10

Financial NPAT – FY05 AGAAP to AI FRS – Full Year Results A$'000s Net profit after tax under AGAAP 30 June 2005 101,462 Basic EPS AGAAP 17.91 cents Write back of goodwill amortisation 41,707 Share based remuneration expense (9,971) Business combinations (5,394) Other (2,413) Net profit after tax under AI FRS 30 June 2005 125,391 Basic EPS AI FRS 22.19 cents Management Adjustments - Profit on sale (9,003) - Business combinations 5,394 Management profit after tax under AI FRS 30 June 2005 121,782 Management EPS AI FRS 21.54 cents 11

Behind the Headline – NPAT I MPACT Financial Results Net profit after tax under AI FRS at 30 June 2006 182,558 Derivatives marked to market 1,344 Intangibles amortisation 948 UK Redundancies 5,208 Profit on sale of Markets Technology (9,867) UK Property Sale Adjustment 1,268 Georgeson tax losses recognised (1,507) Acquisition Adjustments Equiserve (208) CDS Germany 1,637 Management Adjusted profit after tax at 30 June 2006 181,381 12

Management EPS Performance Financial Results Rolling 12 months cents AGAAP AI FRS 32 27 22 17 12 7 FY03 FY04 FY05 FY06 13

Financial Analysis of Management EPS – Half Year Comparison Results AGAAP AI FRS 20.00 18.00 16.00 14.00 12.00 cents 10.00 18.72 8.00 12.16 6.00 12.53 10.53 11.72 8.49 4.00 2.00 0.00 1H04 2H04 1H05 2H05 1H06 2H06 14

Financial Full Year Comparisons – Revenue & EBI TDA Results $Am AI FRS AGAAP $Am 1 800 350 321.3 300 1 500 250 R E 1 200 211.9 e B 183.4 v I 200 e T n D 900 133.9 u A 1 50 e 600 1 00 300 50 719.8 894.7 1083.2 1626.1 0 0 FY03 FY04 FY05 FY06 Total Revenue M anagement EBITDA 15

Half Year Comparisons – Revenue & EBI TDA Financial Results 1st Half 2nd Half $Am $Am $Am $Am AGAAP AI FRS AGAAP AIFRS 900 140 132.4 188.9 900.0 200 800 120 180 800.0 160 90.6 700 100 700.0 140 120.1 80.1 600 80 120 103.3 600.0 100 54.4 79.5 844.7 500 60 781 .5 500.0 80 60 400 40 400.0 592.1 491 .1 495.2 40 20 300 300.0 399.5 364.1 355.7 20 0 200.0 200 0 2H03 2H04 2H05 2H06 1H03 1H04 1H05 1H06 Rev enue Management EBITDA Revenue Management EBITDA 16

Financial Results North America 19% 20% Regional Analysis – FY06 Revenue & EBI TDA EBITDA Breakdown EMEA Asia Pacific 61% 20% North America Total Revenue Breakdown 21% EMEA Asia Pacific 59% 17

EBITDA - EMEA Financial Results EBITDA - NA EBITDA - AP Depreciation Amortisation Interest OEI Tax 1 2 3 4 5 6 7 8 181.4 S PAT FY06 AIFR N 0.4 8 26.0 7 18.8 6 2.4 5 5.8 4 FY06 NPAT Analysis 107.2 3 15.2 2 14.2 1 121.8 S PAT FY05 AIFR N $Am 225 175 125 75 25 18

Financial Results Half Year Comparisons – Operating Costs 658.5 2H06 650.5 1H06 AI FRS 472.2 2H05 1H05 401.1 393.2 2H04 AGAAP 317.9 1H04 $Am 700 600 500 400 300 200 100 0 19

Financial Technology Costs – Establishing Global Platform Results AGAAP AI FRS A$m % 12% 160 12% 154.7 11% 10% 10% 140 10% 120 8% 106.6 100 6% 92.1 83.5 80 4% 60 2% 40 0% FY03 FY04 FY05 FY06 Total Technology costs Technology costs as a % of sales revenue 20

Financial Results Total Costs $Am 154.7 Development Costs $Am 54.2 Analysis of FY06 Technology Costs Admin incl. External Bureau 35% 18% Maintenance 3% Infrastructure Development 44% 21

Net Operating Cash Flows Financial Results Operating Cash Flows Vs. Capital Expenditure $Am 245.8 240 220 200 180 160 146.8 136.1 140 120 100 76.2 80 60 33.4 40 31.6 17.9 21.4 20 0 FY03 FY04 FY05 FY06 Operating Cash Flows Capital Expenditure 22

Free Cash Flow – up 84% on FY05 Financial Results $Am Operating Cash Flows less Capital Expenditure 212.4 220 200 180 160 140 114.7 115.2 120 100 80 58.3 60 40 20 0 FY03 FY04 FY05 FY06 23

Balance Sheet as at 30 June 2006 Financial Results AI FRS AI FRS Variance FY06 FY05 A$'000s A$'000s Current Assets 457,646 495,224 (8% ) Non Current Assets 1,709,463 1,546,037 11% Total Assets 2,167,109 2,041,261 6% Current Liabilities 359,140 485,003 26% Non Current Liabilities 861,690 764,660 (13% ) Total Liabilities 1,220,830 1,249,663 2% Total Equity 946,279 791,598 20% 24

Computershare Borrowings Financial Results AI FRS AI FRS Variance FY06 FY05 A$m A$m Cash 98.4 157.1 (37% ) I nterest Bearing Liabilities * 644.3 683.4 6% Net Debt 545.9 526.3 (4% ) Management EBITDA 321.3 211.9 52% Coverage 1.7 2.5 0.8 * Average Tenor of drawn debt is 5.2 years 25

Capital Expenditure Financial Results Capital Expenditure Vs. Depreciation $Am 35.0 2.7 1.7 30.0 8.1 5.8 25.0 Depreciation 0.5 6.8 20.0 6.4 2.4 4.2 2.7 15.0 1.7 1.0 10.0 16.8 16.8 14.0 5.0 12.8 0.0 FY03 FY04 FY05 FY06 Information Technology Document Services Facilities Occupancy Other 26

Working Capital Management Financial Results Days Sales Outstanding Days 70 62 61 57 60 54 50 40 30 20 10 0 FY03 FY04 FY05 FY06 27

Return On I nvested Capital Vs. WACC Financial Results I ncreased returns, Cost of Capital increases slightly AI FRS AGAAP 18% 16% 14% 12% 10% 8% 6% FY03 FY04 FY05 FY06 WACC ROIC 28

Financial Results FY06 AI FRS ROE Return on Equity Vs. Return on Assets FY05 ROA FY04 AGAAP FY03 20% 15% 10% 5% 0% 29

I nterest Rate Sensitivity Financial Results A$m PBT 120 Impact 100 80 60 40 20 0 -2.50% -2.00% -1.50% -1.00% -0.50% 0.00% 0.50% 1.00% 1.50% 2.00% 2.50% 3.00% 3.50% 4.00% 4.50% -20 -40 -60 Exposure Hedged exposure 100% Hedged -80 30

Financial Equity Management – Final Dividend of 7 cps Results EPS – Basic 30.63 cents › EPS – Management 30.44 cents › Final Dividend (unfranked) 7.0 cents › Current Yield* 1.7% › * Based on 12 month dividend and share price of $7.45 (close 15th Aug 06) 31

Financial Summary – Final Remarks Financial Results › Continued strong EPS growth - 41% after 5 years of growth > 20% CAGR › Free cash flow up 84% › Record revenues › Maintained strong balance sheet lowering earnings to debt coverage by 32% › Final dividend increased to 7 cents per share 32

CEO’s Report Performance Financial Overview Market 33

Chris Morris CEO CEO PRESENTATI ON 34