Nutun Limited · JSE:NTU
Nutun — Transaction Capital — HY2020 Earnings Presentation
74 slides from Nutun's earnings presentation, 2020
Slide 1: Results Presentation 2020
T R A N S A C T I O N C A P I TA L RESULTS PRESENTATION 2020 FOR THE HALF YEAR ENDED 31 MARCH
Slide 2: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 3: Financial Highlights
FINANCIAL HIGHLIGHTS 2 HY20 COMPARED TO HY19 ROBUST OPERATIONAL, FINANCIAL & CREDIT PERFORMANCE IN LINE WITH EXPECTATION OF HIGH-TEEN % GROWTH 20% 19% Pre COVID-19 adjustments • Headline earnings ▲19% to R402m (HY19: R338m) (65) 15% • Headline earnings per share ▲18% to 65.4 cents (HY19: 55.3 cents)
Slide 4: Financial Highlights: Performance, Reported Performance, Dividend
FINANCIAL HIGHLIGHTS 3 HY20 COMPARED TO HY19 PERFORMANCE REPORTED PERFORMANCE DIVIDEND PRE COVID-19 ADJUSTMENTS POST COVID-19 ADJUSTMENTS ROBUST OPERATIONAL, • SA Taxi | ▲ R126m in credit provisions NO INTERIM DIVIDEND DECLARED | FINANCIAL & CREDIT • TCRS | ▼ R65m adjustment to carrying value PRESER
Slide 5: Financial Highlights
FINANCIAL HIGHLIGHTS 4 HY20 COMPARED TO HY19 PERFORMANCE PRE PERFORMANCE POST PERFORMANCE PRE PERFORMANCE POST COVID-19 ADJUSTMENT COVID-19 ADJUSTMENT COVID-19 ADJUSTMENT COVID-19 ADJUSTMENT R230 million R156 million R158 million R111 million HEADLINE EARNINGS ATTRIBUTABLE TO GROUP HEADLINE EARNINGS
Slide 6: Group Portfolio Mix
GROUP PORTFOLIO MIX 5 COMPOSITION OF EARNINGS 4% 5% 39% 38% 2020 2019 57% 57% SA Taxi TCRS GEO 2020 2019 Growth Headline earnings Rm Rm 2020 SA Taxi¹ 230 192 ▲20% TCRS¹ 158 128 ▲23% GEO 14 18 ▼22% TOTAL 402 338 ▲19% Cents per share 65.4 55.3 ▲18% 1. Based on core headline earnings from continuing op
Slide 7: TC Strategic Imperatives
TC STRATEGIC IMPERATIVES 6 DELIVERING ON GROWTH EARNINGS GROWTH & RETURNS TRACK RECORD WELL CAPITALISED & LIQUID BALANCE SHEET • Track record proven over ~20 years • Conservative equity capital structure • HEPS CAGR of 20% over past five years › R6.2bn of capital | 23.1% tier I capital adequacy • Pr
Slide 8: SA Taxi Strategic Imperatives
SA TAXI STRATEGIC IMPERATIVES 7 DELIVERING ON GROWTH EARNINGS GROWTH & RETURNS TRACK RECORD SA TAXI FINANCE • Track record proven over ~20 years • Gross loans & advances ▲14% | Number of loans originated ▼9% (HY19: ▲9%) • Headline earnings CAGR of 21% over past five years › Toyota production ▼ | Ind
Slide 9: SA Taxi Strategic Imperatives
SA TAXI STRATEGIC IMPERATIVES 8 DELIVERING ON GROWTH DELIVERING SHARED VALUE FOR THE MINIBUS TAXI INDUSTRY SA TAXI | LOOKING FORWARD OVER NEAR-TERM • Progressive COVID-19 initiatives | Refer to slide 14 • Continued support for minibus taxi industry, commuters & clients › Minibus taxi industry & comm
Slide 10: TCRS Strategic Imperatives
TCRS STRATEGIC IMPERATIVES 9 DELIVERING ON GROWTH EARNINGS GROWTH & RETURNS TRACK RECORD COLLECTIONS REVENUE IN SOUTH AFRICA ▲~20% • Track record proven over ~20 years DESPITE CHALLENGING ENVIRONMENT • Headline earnings CAGR of 29% over past five years EXCELLENT REVENUE GROWTH IN COLLECTION OF SA NP
Slide 11: TCRS Strategic Imperatives
TCRS STRATEGIC IMPERATIVES 10 DELIVERING ON GROWTH REALIGNMENT OF TCRS TCRS | LOOKING FORWARD OVER NEAR-TERM • Creation of single scaled Transactional Services platform • ▼ Acquisition of NPL Portfolios in SA, Australia & Europe › Fihrst acquired in December 2019 | Accsys acquired in December 2017 ›
Slide 12: Transaction Capital Group Structure 2020
TRANSACTION CAPITAL GROUP STRUCTURE 2020 11 GROWING EARNINGS BASE BY EXPANDING EXISTING TOTAL ADDRESSABLE MARKET & ENTERING ADJACENT MARKET SEGMENTS VIA VERTICAL INTEGRATION TRANSACTION CAPITAL SA TAXI 2020 TRANSACTION CAPITAL RISK SERVICES 2020 SERVICES CAPITAL SOLUTIONS Collection services (SA & A
Slide 13: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 14: COVID-19 Impact
COVID-19 IMPACT 13 COVID-19 IMPACT ON SA TAXI’S FLEET ACTIVITY¹ COVID-19 IMPACT ON COLLECTION ACTIVITY¹ ~68% ~58% ~70% ~1 700 ~650 >1 000 CALL CENTRE CALL CENTRE CALL CENTRE OPERATING VEHICLES OPERATING HOURS PASSENGER LOADS AGENTS ON SITE AGENTS ON WFH AGENTS ON WFH ~44% ~47% ~47% MARCH 2020 MID AP
Slide 15: Progressive COVID-19 Initiatives
PROGRESSIVE COVID-19 INITIATIVES 14 SA TAXI SUPPORT TCRS SUPPORT • Minibus taxi industry, drivers & commuters • TCRS clients & employees › >R3m donation towards health & safety › Continued employment to >1 000 call centre staff on WFH › Hand sanitisers & facial masks at ranks › No compromise to data
Slide 16: COVID-19 – A Flexible Response
COVID-19 – A FLEXIBLE RESPONSE 15 BUSINESS MODEL ASSETS & CASHFLOW • Business model remains highly relevant in post COVID-19 environment • Short-term disruption to collections • SA Taxi • SA Taxi › Industry to recover quickly, as demand for minibus taxi services will be 1 st to benefit › Loan repaym
Slide 17: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 18: Conservative Funding Philosophy
CONSERVATIVE FUNDING PHILOSOPHY 17 FUNDING PHILOSOPHY INNOVATIVE ENGAGED DEBT INVESTORS JUDICIOUS RISK MITIGATION OPTIMAL CAPITAL STRUCTURES THINKING • Recurring investment by debt investors • Optimal liquidity management between asset & liability • Proactively managing valuable capital & funds Inno
Slide 19: Unfettered Access to Liquidity
UNFETTERED ACCESS TO LIQUIDITY 18 R2.7 billion R5.5 billion R1.8 billion WELL CAPITALISED TOTAL EQUITY TOTAL EQUITY TOTAL EQUITY BALANCE SHEETS 21.4% 26.7% 3.1 times CAPITAL ADEQUACY RATIO CAPITAL ADEQUACY RATIO LEVERAGE Equity 16.5% | Subordinated debt 4.9% Equity 23.1% | Subordinated debt 3.6% UND
Slide 20: Diversified Debt Funding Strategy
DIVERSIFIED DEBT FUNDING STRATEGY 19 DIVERSIFICATION BY DIVERSIFICATION BY DIVERSIFICATION BY DEBT INVESTOR CATEGORY FUNDING STRUCTURE & INSTRUMENT GEOGRAPHY & CAPITAL POOL 15% 13% 21% 20% 11% 33% 20% 9% 18% 13% 24% 40% 80% 36% Warehousing facilities Institutional investors On-balance sheet & syndic
Slide 21: Diversified Debt Funding Strategy
DIVERSIFIED DEBT FUNDING STRATEGY 20 PASS THROUGH WAREHOUSING PRIVATE STRUCTURED FINANCE ON BALANCE SHEET DEBT STRUCTURE STRUCTURES FACILITIES (MAJORITY INTERNATIONAL DFIs) & SYNDICATED LOANS HY20 BALANCE OUTSTANDING R4.6 billion R1.7 billion R4.2 billion R2.4 billion COMPOSITION ~36% ~13% ~33% ~18%
Slide 22: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 23: Environment for Minibus Taxi Operators
ENVIRONMENT FOR MINIBUS TAXI OPERATORS 22 INDUSTRY IS DEFENSIVE & GROWING WITH RESILIENT OPERATORS STRUCTURAL ELEMENTS SUPPORT MINIBUS TAXI INDUSTRY RESILIENCE DOMINANT & GROWING MODE DEMAND FOR MINIBUS TAXIS > SUPPLY IN SOUTH AFRICA OF INTEGRATED PUBLIC TRANSPORT NETWORK TOTAL DEMAND 40% Accessible
Slide 24: Environment for Minibus Taxi Operators
ENVIRONMENT FOR MINIBUS TAXI OPERATORS 23 INDUSTRY IS DEFENSIVE & GROWING WITH RESILIENT OPERATORS DESPITE CHALLENGING ECONOMIC ENVIRONMENT CHALLENGING ENVIRONMENT FOR MINIBUS TAXI OPERATORS INTEREST RATES VEHICLE PRICES 6.3% 23.0% ~R370 ▼ R463 000 R877 135 R443 100 AVERAGE REPO RATE1 AVERAGE INTERE
Slide 25: SA Taxi Financial Performance
SA TAXI FINANCIAL PERFORMANCE 24 Headline earnings 44.5 44.1 • ▲36% to R282m (pre COVID-19 adjustment) | ▼8% to R191m (post COVID-19 adjustment) 41.3 TC’s attributable portion • ▲20% to R230m (pre COVID-19 adjustment) | ▼19% to R156m (post COVID-19 adjustment) 11.7 11.5 12.2 › All organic growth 11.
Slide 26: SA Taxi Credit Performance
SA TAXI CREDIT PERFORMANCE 25 Gross loans & advances ▲14% to R11.3bn • Momentum in sale & finance of pre-owned vehicles | Expanded refurbishment facility in development • Launch of a lower interest rate product for lower risk clients 18.2 19.1 • Toyota vehicle prices ▲2.5% in HY20 17.6 • Offset by n
Slide 27: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 28: TCRS Market Positioning: Diversified Business Model
TCRS MARKET POSITIONING | DIVERSIFIED BUSINESS MODEL 27 BY BUSINESS ACTIVITY, REVENUE MODEL, GEOGRAPHY, SECTOR, CLIENT & MANDATE BUSINESS ACTIVITIES COLLECTION SERVICES DIVERSIFICATION ~3% ~2% Contingency & FFS Selected Australia international NPL Portfolios as principal 26% markets2 Australia >1% ~
Slide 29: Environment & Market Context: South Africa
ENVIRONMENT & MARKET CONTEXT | SOUTH AFRICA 28 DEFENSIVELY POSITIONED IN A CHALLENGING CONSUMER CREDIT ENVIRONMENT MACRO- & SOCIO-ECONOMIC ENVIRONMENT IN SA PLACING PRESSURE ON CONSUMERS OVER THE MEDIUM-TERM HIGHLY RELEVANT BUSINESS MODEL IN A POST COVID-19 ENVIRONMENT Transaction Capital’s consumer
Slide 30: Environment & Market Context: Australia
ENVIRONMENT & MARKET CONTEXT | AUSTRALIA 29 AUSTRALIAN CONSUMER CREDIT ENVIRONMENT AUSTRALIAN CONSUMER EMPLOYED BUT HIGHLY LEVERAGED AUSTRALIAN DEBT COLLECTION ENVIRONMENT • 5.2% unemployment (March 2020), ▲unemployment • Aus bush fires placing strain on an already indebted consumer Consumers: Marke
Slide 31: TCRS Strategic Growth Initiatives to Create Value
TCRS STRATEGIC GROWTH INITIATIVES TO CREATE VALUE 30 GROWTH OPPORTUNITIES IN AN UNDERDEVELOPED & GROWING SA MARKET TOP BUYERS OF TOP BUYERS OF CONSUMER DEBT IN EUROPE TOP BUYERS OF CONSUMER DEBT IN USA1 Buyer $million CONSUMER DEBT IN AUS Buyer $million • Intrum ~$1 133m Buyer $million • Encore Capi
Slide 32: TCRS Strategic Growth Initiatives to Create Value
TCRS STRATEGIC GROWTH INITIATIVES TO CREATE VALUE 31 OPPORTUNITIES FOR CAUTIOUS ORGANIC GROWTH IN SIGNIFICANTLY LARGER SELECT MARKETS STILL REMAIN VALID Expect ▼in acquisition of NPL Portfolios over short-term • Cautious & selective approach in SA, Australia & Europe • Focus on bilateral arrangement
Slide 33: Acquisition of NPL Portfolios in South Africa & Australia
TCRS STRATEGIC GROWTH INITIATIVES TO CREATE VALUE 32 ACQUISITION OF NPL PORTFOLIOS AS A PRINCIPAL IN SOUTH AFRICA & AUSTRALIA GROWTH TRAJECTORY TO SUPPORT FUTURE POSITIVE PERFORMANCE COLLECTION MULTIPLE VINTAGE PERFORMANCE¹ AS AT 31 MARCH 2020 5 321 Cost price of purchased book debts acquired (Rm) R
Slide 34: TCRS Financial Performance
TCRS FINANCIAL PERFORMANCE 33 Headline earnings 80.7 80.1 • ▲23% to R158m (Pre COVID-19 adjustment) | ▼13% to R111m (Post COVID-19 adjustment) 79.4 Non-interest revenue ▲19% to R1.1bn • Organic revenue from collection services ▲23% 56 • SA | Excellent revenue growth in collection of NPL Portfolios p
Slide 35: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 36: Shareholding, Dividend & Board of Directors
SHAREHOLDING, DIVIDEND & BOARD OF DIRECTORS 35 5% Dividend • No interim dividend declared | Preserving financial flexibility & liquidity 21% Accelerated bookbuild enhancing liquidity & daily trade • Free float ▲to 79% (HY19: 68%) • Average daily number of shares traded ▲>100% to 1.5m (HY19: 0.4m) •
Slide 37: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 38: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 39: Transaction Capital
TRANSACTION CAPITAL 38 As a listed entity, to extend our track record TRANSACTION CAPITAL of high-quality earnings growth, we identify opportunities to leverage our high IP, leading technologies & low-cost operational infrastructure Our capital management approach to expand into attractive adjacent
Slide 40: Investment Case
INVESTMENT CASE 39 COMPELLING & UNIQUE AS WE EXECUTE ON OUR STRATEGY • Two well established, autonomous & unique financial services businesses: SA Taxi & TCRS • Positioned in attractive market segments occupying leading market positions TRANSACTION CAPITAL • Highly defensive, context relevant busine
Slide 41: Investment Case Continued
INVESTMENT CASE CONTINUED 40 COMPELLING & UNIQUE AS WE EXECUTE ON OUR STRATEGY LED BY AN EXPERIENCED • Identify, assess, develop & partner with entrepreneurial, innovative & experienced founders, owners & managers of businesses • Ownership culture ENTREPRENEURIAL • Empowered, entrepreneurial, agile,
Slide 42: Investment Case Continued
INVESTMENT CASE CONTINUED 41 COMPELLING & UNIQUE AS WE EXECUTE ON OUR STRATEGY TO GENERATE RISK-ADJUSTED • Value-led investment approach • Investment objective that yields: INTEREST RETURNS & CAPITAL › Attractive risk-adjusted interest returns from our asset portfolios APPRECIATION › Enhanced by cap
Slide 43: Transaction Capital Business Model
TRANSACTION CAPITAL BUSINESS MODEL 42 CAPITAL INPUTS CAPITAL OUTCOMES 1 2 INTELLECTUAL CAPITAL Identify credit-orientated alternative Apply core skills to assess & INTELLECTUAL CAPITAL Market-leading & socially relevant business platforms with scale & asset classes, in which our core risk & mitigate
Slide 44: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 45: SA Taxi
SA TAXI 44 An innovative & pioneering business model SA TAXI with operations expanding throughout the financial services & asset value chain, building a scalable platform IS A VERTICALLY INTEGRATED that can be leveraged in adjacent markets A unique blend of vehicle procurement, retail, MINIBUS TAXI
Slide 46: Environment & Market Context
ENVIRONMENT & MARKET CONTEXT 45 MINIBUS TAXI INDUSTRY IS RESILIENT, DEFENSIVE & GROWING DESPITE SA’S ECONOMIC CLIMATE PUBLIC TRANSPORT COMMUTERS RELY ON MINIBUS TAXIS TRAIN GIVEN THEIR ACCESSIBILITY, AFFORDABILITY, RELIABILITY & FLEXIBILITY < 500 000 ▼33% • 40% of South Africans use public transport
Slide 47: Environment for Minibus Taxi Operators
ENVIRONMENT FOR MINIBUS TAXI OPERATORS 46 MINIBUS TAXIS ARE THE PREFERRED MODE OF PUBLIC TRANSPORT DUE TO COMPETITIVE PRICING, ACCESSIBILITY & RELIABILITY LOWER LSM CONSUMERS SPEND ~ 40% OF MONTHLY HOUSEHOLD INCOME ON PUBLIC TRANSPORT FARES COMMUTER TRIPS VIA BUS & RAIL MOSTLY REQUIRE FIRST & LAST K
Slide 48: Environment for Minibus Taxi Operators
ENVIRONMENT FOR MINIBUS TAXI OPERATORS 47 FARE INCREASES MUTED IN 2019 FARES DETERMINED BY EACH ASSOCIATION PER ROUTE • The industry ensures operators remain profitable • Demand for minibus taxi services is relatively inelastic FARE INCREASE CONSIDERATIONS INCLUDE • Timing & extent of prior increase
Slide 49: Environment & Market Context
ENVIRONMENT & MARKET CONTEXT 48 INTEGRATED PUBLIC TRANSPORT NETWORK, WITH BUS & RAIL COMMUTERS RELYING ON MINIBUS TAXI INFRASTRUCTURE JOHANNESBURG Last updated FY19: Source: SA Taxi telematics data as at 11 October 2016 | National Land Transport Strategic Framework 2015
Slide 50: SA Taxi Impact
SA TAXI IMPACT 49 DELIVERING SHARED VALUE FOR THE INDUSTRY ECONOMIC TRANSFORMATION & INCLUSIVE GROWTH SME EMPOWERMENT DEVELOPMENTAL CREDIT ACHIEVING INCLUSIVE GROWTH 100% 27% 20% BLACK OWNED SMEs WOMEN OWNED SMEs¹ UNDER THE AGE OF 35 YEARS¹ R1.8 billion R27.5 billion LOANS ORIGINATED CREATING LOANS
Slide 51: SA Taxi Market Positioning
SA TAXI MARKET POSITIONING 50 VERTICALLY INTEGRATED BUSINESS MODEL
Slide 52: SA Taxi Market Positioning
SA TAXI MARKET POSITIONING 51 VERTICALLY INTEGRATED BUSINESS MODEL DEVELOPMENTAL CREDIT DRIVING POSITIVE SOCIAL IMPACT SA TAXI FINANCE INCLUSIVE GROWTH | ECONOMIC TRANSFORMATION 11.3 billion 33 079 ~1.3 PROPORTION OF CUSTOMERS CLASSIFIED ~ 80% Proportion of customer base AS PREVIOUSLY FINANCIALLY EX
Slide 53: Vertically Integrated Business Model
VERTICALLY INTEGRATED BUSINESS MODEL 52 MINIMISING THE COST OF RISK, BY MAXIMISING RECOVERIES SA Taxi’s vertically integrated business model • Repossess, refurbish, salvage parts, resell & refinance • Loss given default <25% • Recovery ratio >75% LOSS GIVEN NON-PERFORMING REPOSSESSION DEFAULT CREDIT
Slide 54: SA Taxi Auto Repairs
SA TAXI MARKET POSITIONING 53 VERTICALLY INTEGRATED BUSINESS MODEL SA TAXI AUTO REPAIRS | AUTOBODY SA TAXI AUTO REPAIRS ~20 000m² ~220 per month ~400 WORKSHOP INTERNAL VEHICLE EMPLOYEES FACILITIES REFURBISHMENT CAPACITY >75% ~ 4% to ~6% RECOVERY RATES ON REPOSSESSION, AVERAGE REFURBISHMENT COST¹ R
Slide 55: SA Taxi Direct
SA TAXI MARKET POSITIONING 54 VERTICALLY INTEGRATED BUSINESS MODEL NEW MINIBUS TAXI SA TAXI DIRECT • SA Taxi Direct sells new & pre-owned minibus taxis • SA Taxi’s pre-owned minibus taxis: › Rebuilt to a high-quality › Trusted product in the industry › Provides a reliable & affordable alternative in
Slide 56: SA Taxi Protect
SA TAXI MARKET POSITIONING 55 VERTICALLY INTEGRATED BUSINESS MODEL TELEMATICS & TECHNOLOGY SA TAXI PROTECT >31 000 MAJORITY OF FINANCED CLIENTS INSURANCE CLIENTS CHOOSE TO BE INSURED BY SA TAXI¹ >2.0 >100 BROKER NETWORK PRODUCTS PER CLIENT to expand total addressable market • Premiums remained stabl
Slide 57: SA Taxi Auto Parts
SA TAXI MARKET POSITIONING 56 VERTICALLY INTEGRATED BUSINESS MODEL SA TAXI AUTO PARTS | SALVAGE SA TAXI AUTO PARTS LAUNCHED MARCH 2018 | SALVAGE OPERATIONS ESTABLISHED THEREAFTER • Import & locally procure new parts from source at lower cost COST OF REFURBISHMENT • Salvage used parts from vehicles
Slide 58: SA Taxi Rewards
SA TAXI MARKET POSITIONING 57 VERTICALLY INTEGRATED BUSINESS MODEL SANTACO & SA TAXI DELIVERING SUSTAINABLE SA TAXI REWARDS BENEFITS TO SA TAXI CLIENTS & THE INDUSTRY • Direct benefits for the industry resulting from ownership transaction FUEL PROGRAMME between SA Taxi & SANTACO • Leverage industry’
Slide 59: SA Taxi Operational Performance
SA TAXI OPERATIONAL PERFORMANCE 58 SA TAXI OPERATOR PROFILE CREDIT PROFILE OF LOANS ON BOOK 1.3 4.0 years 71 months 43% VEHICLES PER CUSTOMER AVERAGE AGE OF VEHICLE AVERAGE LOAN TERM1 AVERAGE APPROVAL RATE 47 years 88% >R6 000 47 months AVERAGE AGE OF CUSTOMER TOYOTA VEHICLES MINIMUM MONTHLY OPERATO
Slide 60: Early Adoption of IFRS 17 | Insurance Contracts
EARLY ADOPTION OF IFRS 17 | INSURANCE CONTRACTS 59 MORE CONSERVATIVE PROVISIONING METHODOLOGY INCURRED VS. EXPECTED LOSS 20.5 INCURRED LOSS MODEL FORWARD LOOKING | EXPECTED LOSS MODEL 29.9 OCR LRC IFRS 4 3.3Incurred LIC 2.2claims IBNR IFRS 17 OCR + Incurred IBNR LIC + & expected claims IFRS 4 IFRS 1
Slide 61: SA Taxi Vertically Integrated Business Model
SA TAXI VERTICALLY INTEGRATED BUSINESS MODEL 60 BUSINESS PLATFORM SERVICING MINIBUS TAXI OPERATORS ACROSS THE VALUE CHAIN SA Taxi’s business model video telestration as published at FY18 | http://www.transactioncapital.co.za/taxi.php
Slide 62: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 63: Transaction Capital Risk Services
TRANSACTION CAPITAL RISK SERVICES 62 TRANSACTION CAPITAL RISK SERVICES Innovative & bespoke technology systems Generating in-depth insights from the continuous IS A TECHNOLOGY-LED, that drive superior performance & efficiency collection of accurate & valuable data to develop a consolidated view of a
Slide 64: TCRS Market Positioning: Competitive Advantages
TCRS MARKET POSITIONING 63 COMPETITIVE ADVANTAGES TCRS’s PROPRIETARY DATA • Database of SA’s distressed consumers • Continuously enriched (with collection & ContactAbility results) REPUTATION OF PERFORMANCE ANALYTICS • Only local listed industry participant • Predictive & layered voice analytics to
Slide 65: Environment & Market Context: South Africa
ENVIRONMENT & MARKET CONTEXT | SOUTH AFRICA 64 DEFENSIVELY POSITIONED IN A CHALLENGING CONSUMER CREDIT ENVIRONMENT CREDIT REHABILITATION IS A CRUCIAL ELEMENT IN GROWING AN INCLUSIVE ECONOMY TRANSACTION CAPITAL’S CONSUMER CREDIT REHABILITATION INDEX % CHANGE IN REHABILITATION PROSPECT FOR Q1 2020 • N
Slide 66: TCRS Strategic Growth Initiatives: European Distressed Debt
TCRS STRATEGIC GROWTH INITIATIVES TO CREATE VALUE 65 CONCENTRATED SEGMENT OF EUROPEAN DISTRESSED DEBT MARKET UNATTRACTIVE • High levels of competition • Many participants of scale (credit management platforms, private equity funds & asset managers) • Access to cheap capital & leverage deployed for m
Slide 67: TCRS Strategic Growth Initiatives to Create Value
TCRS STRATEGIC GROWTH INITIATIVES TO CREATE VALUE 66 ENTER FRAGMENTED SEGMENT OF INTERNATIONAL SPECIALISED CREDIT MARKET TCRS’s SELECTIVE & CAUTIOUS DIVERSIFICATION SUPPORTS PERFORMANCE INVESTMENT APPROACH IN VARYING MARKET CONDITIONS • Target select off-market investment opportunities • Portfolio t
Slide 68: TCRS Market Positioning: Diversified Business Model
TCRS MARKET POSITIONING 67 DIVERSIFIED BUSINESS MODEL TCRS’s business model video telestration as published at HY19 | http://www.transactioncapital.co.za/risk.php
Slide 69: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 70: Capital Management
CAPITAL MANAGEMENT 69 Cost of borrowing 12.0% 11.7% 11.4% 10.8% 11.0% 10.7% 5.0% 4.9% 4.7% 4.6% 4.4% 5.0% 5.8% 6.4% 7.0% 6.8% 6.7% 6.3% HY15 HY16 HY17 HY18 HY19 HY20 Average repo rate during the period Cost of borrowing margin above repo rate¹ 1. Calculated using Transaction Capital’s average cost o
Slide 71: Results for the half year ended 31 March 2020
2 0 2 0 RESULTS FOR THE HALF YEAR ENDED 31 MARCH
Slide 72: Glossary
GLOSSARY 71 AUS Australia JIBAR The Johannesburg Interbank Average Rate ACCSYS Accsys, a 100% owned subsidiary of TCRS NPL Non-performing loans within SA Taxi’s loans & advances portfolio BPS Basis points NPL Portfolio Non-performing consumer loan portfolio acquired by TCRS to be collected as princi
Slide 73: Glossary
GLOSSARY 72 TCBS Transaction Capital Business Solutions, a 100% owned subsidiary of TCRS TCRS Transaction Capital Risk Services TRP Taxi Recapitalisation programme WFH Work from home
Slide 74: Disclaimer
DISCLAIMER 73 This presentation may contain certain "forward-looking statements" regarding beliefs or expectations of the TC Group, its directors & other members of its senior management about the TC Group's financial condition, results of operations, cash flow, strategy & business & the transaction