Bendigo & Adelaide Bank Ltd. · ASX:BEN
Bendigo & Adelaide Bank — FY2004 Earnings Presentation
42 slides from Bendigo & Adelaide Bank's earnings presentation, August 2004
Slide 1: 2004 profit announcement
2004 profit announcement Rob Hunt Managing Director Craig Langford Chief Financial Officer
Slide 2: Financial results
Financial results Craig Langford Chief Financial Officer 2
Slide 3: A growing capacity
A growing capacity Normalised operating profit increased by 24% to $73.2 million Reported profit increased by 35% to $79.8 million Normalised earnings per share up by 18% to 55.2 cents Final dividend up 3.0 cents to 23.0 cents Full-year dividend increased by 6.5 cents to 40.0 cents 3
Slide 4: Operating profit - after tax
Operating profit - after tax 4
Slide 5: Specific items
Specific items A$ Millions Profit on sale of Cashcard shares $7.6 GST recovery $1.5 Profit on property sales $1.3 Investment in Inch Corporation write-off ($1.1) Share of BSX Losses (1998 - 2004) ($0.6) Income Tax effect ($2.1) TOTAL $6.6 5
Slide 6: Net interest margin
Net interest margin % 3.00 2.80 2.60 2.40 2.20 2.00 2002 2003 2004 V4 aa y ¥ £. | A REWARDING FOCUS . © Bendigo Bank |
Slide 7: Non interest income
Non interest income as at 30 June 2004 7
Slide 8: Non interest income
Non interest income as at 30 June 2004 8
Slide 9: Contributions
Contributions : ia] i | AS Millions 16 14 12 10 ON FD OW Community Bank® o Bendigo Bank
Slide 10: Funds under management
10 Funds under management ASMillions Jun02 Jun03 Sandhurst Mortgage & Cash Funds 952.0 1,195.2 Sandhurst Industrial Share Fund 153.3. 272.5 Bendigo Superannuation Plan 103.6 146.8 General Retirement Plan 53.1 52.9 Bendigo Managed Funds 6.0 48.4 Other 15.9 17.6 25.6 Total 1,283.9 1,733.4 2,158.9 8) B
Slide 11: Operating expenses
Operating expenses as at 30 June 2004 11
Slide 12: Operating expenses as at 30 June 2004
Operating expenses as at 30 June 2004 12
Slide 13: Efficiency ratio
Efficiency ratio (operating expenses/income) 13
Slide 14: Total assets
14 Total assets A$ Millions 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 A REWARDING FOCUS © Bendigo Bank
Slide 15: Lending approvals
15 Lending approvals A$ Millions 6,000 5,000 4,000 3,000 2,000 1,000 10) ; ke Avs | i> A REWARDING FOCUS . © Bendigo Bank
Slide 16: Retail deposits
16 Retail deposits A$ Millions 10,000 8,000 6,000 4,000 2,000 10) ¥) * ry & | A REWARDING FOCUS . © Bendigo Bank |
Slide 17: Commercial loans
Commercial loans as at 30 June 2004 ($1,774m) 17
Slide 18: Loan portfolio
Loan portfolio By purpose By security 18
Slide 19: Geographic spread
Geographic spread Deposits Loans 19
Slide 20: Non-accrual loans
20 Non-accrual loans AS Millions 30 Net Non Accrua A REWARDING FOCUS © Bendigo Bank
Slide 21: Asset quality
Asset quality Impaired loans/total assets 21
Slide 22: Capital adequacy
| vie < Capital adequacy A Ee | 14 12) 11.69 10.57 10 10.35 % ON £& DD OW 2002 2003 2004 © Bendigo Bank
Slide 23: Return on equity
23 Return on equity 14 12 10 % ON FD OW 2002 2003 2004 A REWARDING FOCUS © Bendigo Bank
Slide 24: Earnings per share
24 Earnings per share Cents Normalised A REWARDING FOCUS © Bendigo Bank
Slide 25: Strategy, performance and the future
Strategy, performance and the future Rob Hunt Managing Director 25
Slide 26: Building a sustainable retail banking business
Building a sustainable retail banking business Create a unique bank identity and demand for our brand & services Broaden our distribution network and product offering Enhance the capacity of our communities (and therefore their inclination to support our business) Improve the financial performance o
Slide 27: A unique bank identity: Customer & community focus
A unique bank identity: Customer & community focus Core strengths - honesty, quality service and customer engagement Strategy produces improved customer & community outcomes In 1990s banks disengaged with community (and customer expectations) Community Bank® reinforced our point of difference ‘A ban
Slide 28: A unique bank identity: Growing demand
A unique bank identity: Growing demand Positive market awareness & customer satisfaction surveys Community Bank® demand continues Growing interstate activity – Qld, NSW, WA, Tas, SA Solid growth continues in our Victorian network Customer numbers: 2001 = 505,000 2004 = 916,000 ‘Our style of banking
Slide 29: Broaden distribution & products: Network growth
Broaden distribution & products: Network growth Total Branch numbers 2001 = 179 2004 = 276 Community Bank® branches 2001 = 45 2004 = 132 Bendigo Bank agencies Stable at around 100 ‘Expansion of community markets available to Bendigo Group’ 29
Slide 30: Broaden distribution & products: Alliances
Broaden distribution & products: Alliances Elders Rural Bank (JV bank - 240 branches) Tasmanian Banking Services (7 branches) Community Sector Banking Guild Banking ‘Bendigo Bank’s collaborative skills being demonstrated’ 30
Slide 31: Broaden distribution & products: Electronic banking
Broaden distribution & products: Electronic banking ATMs 2001 = 117 2004 = 265 e-bank 100,000 users Phone Bank 165,000 users Eftpos terminals 2001 = 1982 2004 = 5413 Cardholders 2001 = 276k 2004 = 580k ‘Strong customer adoption of e-banking activities’ 31
Slide 32: Broaden distribution & products: Wealth Solutions
Broaden distribution & products: Wealth Solutions STL cash & mortgage funds (strong growth) Bendigo Managed Funds (2002) Sandhurst Australian Industrial Share Fund (2000) Funds under management: 2001 = $967m 2004 = $2159m (123% increase) Bendigo Investment Services & Worley Securities (advisory serv
Slide 33: Enhance community capacity: Community Bank
Enhance community capacity: Community Bank® $100 mil. in community revenues retained by the local enterprises since Community Bank® commenced 700 new committed local staff $3m contributed to local projects (increasing rapidly) $2m in dividends paid to local shareholders (increasing rapidly) 1100 loc
Slide 34: Enhance community capacity: Community Telco Australia
Enhance community capacity: Community Telco Australia 2 successful pilot sites 25%-plus reductions in business telco costs New services & infrastructure delivered Rollout to more communities expected soon Improved competitive environment locally ‘Assisting communities with essential infrastructure,
Slide 35: Enhance community capacity: Lead On Australia
Enhance community capacity: Lead On Australia Youth / Community engagement program 12 sites on eastern seaboard to date 1400-plus young participants in community projects to date Potential for expansion to every Bendigo Bank community ‘An excellent bank /community engagement model which improves loc
Slide 36: Enhance community capacity: Other initiatives
Enhance community capacity: Other initiatives Community Sector Banking Community Exchange Australia Community Foundation Active staff participation at a community level Ongoing community sponsorship activities across Australia ‘Being more valuable than competitors in each community’ 36
Slide 37: Improved financial performance
Improved financial performance 2001 2004 2004 Actual Normalised Profit $33.3m $79.8m $73.2m ROE 9.03% 12.99% 11.91% EPS 31.5 cents 60.2 cents 55.2 cents Dividend 29.0 cents 40 cents - Market value $725m $1365m - ‘Steady progression in earnings’ 37
Slide 38: 2004 Performance commentary
2004 Performance commentary Lending, deposit growth strong in all markets Strong growth in revenues Gross margin remains high (Reported margin is net of Community Bank® share) ROE improvement in line with forecast Strong & clean balance sheet ‘Product of a consistent and unique strategy’ 38
Slide 39: Looking forward: Trading environment
Looking forward: Trading environment Strong domestic economy, but … High household debt Upward pressure on interest rates possible International economy performance Leaves us with an outlook which is a little more cautious, despite being optimistic about Bendigo’s current positioning and prospects ‘
Slide 40: Looking forward: Bendigo's position
Looking forward: Bendigo’s position Strong brand and market positioning Robust balance sheet (with expansion to date expensed) 170 branches < 4 years old (170 new communities) 33 new branches in F2005 Funds management growth expected to continue as facilities expand and integration with the banking
Slide 41: Looking forward: Earnings guidance
Looking forward: Earnings guidance Strong retail funding confirms we can fund our growth Above system growth due to relatively young distribution network Expected improvement in Alliance, JV and Subsidiary contributions Normalised profit growth expected to be between 15%-18% in F2005 ‘Revenue growth
Slide 42: 2004 profit announcement
2004 profit announcement Questions
Bendigo and Adelaide Bank — FY2004 Earnings Presentation on 6ix