Investor Presentation February 2017 Executive Summary Euroz Lim - - PowerPoint PPT Presentation

Investor Presentation

February 2017

Executive Summary

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Euroz Lim ited is a grow ing a nd d iv ersified fina ncia l serv ices com p a ny

Note 1: As at 31 December 2016

Investor Presentation - February 2017

• Euroz Limited (“Euroz”) is an ASX-listed, diversified financial services company with a market capitalisation of

$164 million1.

• Euroz cash and investments increasing to $115.1 million1.
• Strong staff ownership of 44% aligns the operations of the business with the interests of shareholders.
• Euroz has a consistent track record of profits and dividends – $185 million of fully franked dividends paid in the

past 16 years.

• Building a unique combination of steady ongoing revenues with transactional and performance fee upside.

Euroz Securities

Stockbroking and Corporate Finance

Funds Managem ent

Westoz Funds Management and Prodigy Investment Partners

Wealth Managem ent

Entrust Private Wealth Management

Organisational Chart

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Investor Presentation - February 2017

Financial Performance

4 Historical Share Price and NTA1 Euroz Lim ited Ownership 1 Net Profit after Tax1 Dividend per share 1

Note 1: As at 31 December 2016 Directors 25% Staff 19% Ice Cold Investments 6% Institutions 8% Retail 42%

Investor Presentation - February 2017

$9 .2 $16 .8 $22.2 $4 1.9 $10 .3 $26 .3 $26 .6 $11.8 $11.1 $26 .6

• $7.1

$2.6 $13.2

• 10

$10.0 $20.0 $30.0 $40.0 $50.0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1H 2017 NPAT (A$m )

$0 .12 $0 .18 $0 .27 $0 .0 8 $0 .12 $0 .18 $0 .0 8 $0 .0 7 $0 .11 $0 .0 5 $0 .0 4 $0 .0 175

$0.05 $0.10 $0.15 $0.20 $0.25 $0.30 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 DPS (A$) H2 H1 $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 2006 2008 2010 2012 2014 2016 NTA (A$) EZL Share Price NTA

First Half Results

• First half for the financial year ended 30 June 2017 net profit after tax of $13.2 million.
• First half dividend 1.75 cents fully franked.
• Strong contribution from Euroz Securities - $510 million of first half equity capital market raisings.
• Euroz ranked number 1 by WA Business News iQ for WA based equity capital raising in 2016.
• Solid first half performance from WIC (up 18.2%) and OZG (up 21.8%).
• Flinders Emerging Companies Fund continues to perform well ( up 21.2% pa) since inception1.
• Dalton Street Capital launched with modest inflows.
• Solid ongoing organic growth from Entrust Private Wealth Management.
• Group FUM $1,143 million (up 19% in 6 months).

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Short term p rofita bility d riv en by strong Equity Ca p ita l Ma rkets a ctiv ity a nd increa ses in W IC a nd OZG sha re p rices

Note 1: September 2015

Investor Presentation - February 2017

Euroz Value Proposition

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Investor Presentation - February 2017

Stockbroking and Corporate Finance

• Daily brokerage turnover provide a

base of revenues

• High im pact (but cyclical)

transactional fee upside (ECM/ M&A)

Wealth Managem ent

• Growing recurring base fee revenue

as funds under management increase

• A platform to attract and acquire new

wealth managers

Funds Managem ent

• Growing recurring base fee

revenue as funds under management increase

• Increased opportunity for high

im pact performance fees from a diversified range of funds Shareholder Value Proposition

Future Investm ent Partners

 

Market Rating/ EV

Dividend Upside

Base Dividend

 

Market Rating/ EV

Dividend Upside

Base Dividend

  

Market Rating/ EV

Dividend Upside

Base Dividend

Euroz Lim ited (EZL.ASX)

Euroz Balance Sheet

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Investor Presentation - February 2017

Cost Market Look through value Westoz1 $38.4m $33.8m $37.3m Ozgrowth1 $27.3m $23.6m $27.9m Flinders Investment Partners1 $6.1m $7.5m $7.5m Dalton Street Capital1 $2.0m $1.9m $1.9m Other Investments1 $5.0m $5.5m $5.5m Cash1 $42.8m $42.8m $42.8m Total $121.6m $115.1m $122.9m Value per share $0.72 $0.77 Market Capitalisation as at 31 December 2016 ($1.045/ share) $164m $164m Enterprise Value as at 31 Decem ber 20 16 $48.9m $41.1m

$0 .12 $0 .18 $0 .27 $0 .0 8 $0 .12 $0 .18 $0 .0 8 $0 .0 7 $0 .11 $0 .0 5 $0 .0 4 $0 .0 2

$0.00 $0.05 $0.10 $0.15 $0.20 $0.25 $0.30 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 1H 2017

DPS (A$)

H1 H2

Dividend History

• Significant Corporate Finance and Funds Management performance fees have typically occurred together.
• Euroz aim s to grow its base level of dividends through increasing recurring revenues and a

diversification of high im pact perform ance and transactional fees. 8

Euroz ha s p a id $18 5 m illion fully fra nked d iv id end s ov er the la st 16 y ea rs

Investor Presentation - February 2017 Significant Performance Fees Significant Corporate Finance Fees (ECM/ M&A)

Stockbroking & Corporate Finance Euroz Securities

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Investor Presentation - February 2017

Research

• Quality equities research is the foundation of our business.
• Highly rated research from our team of seven analysts.

Institutional Sales

• Institutional advisory and equities dealing services.
• Team of nine institutional dealers have significant long-term relationships with

major institutional investors.

Private Client Dealing

• A unique and predominantly high net worth client base.
• Significant capacity to support new issues and construct first class share

registers.

• Expanded wealth management capabilities.

Corporate Finance

• Specialised corporate advisory services including equity capital market raisings,

mergers & acquisitions, takeovers and takeover response, strategic planning and reviews and privatisation & reconstructions.

• Euroz ranked Number 1 according to WA Business News for WA based equity

raises - $712.4 million in calendar year 2016. Long term strategy: Leverage deal flow in WA related com panies through high quality research, dealing and corporate finance services.

Funds Management Westoz Funds Management

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W estoz Fund s Ma na gem ent – Full 10 0 % ow nership of m a na gem ent com p a ny

Note 1: As at 31 December 2016

• Westoz Funds Management (WFM) is a 100%-owned subsidiary of Euroz Limited that was established in May

2005.

• WFM manages portfolios of Australian equities on behalf of two listed investment companies, Westoz

Investment Company Limited (WIC) and Ozgrowth Limited (OZG).

• WIC and OZG have contributed $31.7m 1 in dividend income to Euroz Limited since inception.
• Euroz owns 26.3% of WIC and 38.8% of OZG1.
• The investment objective of both portfolios is to generate consistent positive returns over the medium to long

term.

Westoz Investm ent Com pany Lim ited (ASX:WIC)

Ozgrowth Lim ited (ASX:OZG)

Investor Presentation - February 2017

$0 .10 $0 .11 $0 .0 4 $0 .0 9 $0 .0 9 $0 .0 9 $0 .0 6 $0 .0 3

$0.02 $0.04 $0.06 $0.08 $0.10 $0.12 2010 2011 2012 2013 2014 2015 2016 2017 DPS (A$) H2 H1

$0 .0 14 $0 .0 17 $0 .0 10 $0 .0 15 $0 .0 15 $0 .0 15 $0 .0 0 5 $0 .0 0 25

$0.002 $0.004 $0.006 $0.008 $0.010 $0.012 $0.014 $0.016 $0.018 2010 2011 2012 2013 2014 2015 2016 2017 DPS (A$) H2 H1

Long term strategy: provide a steady base of ongoing m anagem ent fee revenues with potential perform ance fee upside.

Funds Management Prodigy Investment Partners

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La unching a series of sep a ra te boutique fund p rod ucts for both reta il a nd w holesa le inv estors.

Note 1: Inception date is 30 September 2015.

Investor Presentation - February 2017

• Prodigy Investment Partners (Prodigy) is an 80%-owned joint venture between Euroz Limited and former

MLC CEO Steve Tucker.

• The first of these new boutique fund management partnerships was announced in July 2015 – with Flinders

Investment Partners (Flinders) and subsequently Dalton Street Capital (DSC) was launched in May 2016.

• Flinders is a specialist small companies investment manager

that brings together two of Australia’s most experienced small and emerging company investors Andrew Mouchacca (ex - Contango Asset Management) and Richard Macdougall (ex - Perennial Growth).

• Flinders has achieved “Recommended” rating from

Independent Investment Research and “Investment grade” rating from Zenith and Lonsec.

• Since inception, Flinders Emerging Companies Fund has

performance (after fees and expenses) of 21.2% pa versus the S&P/ ASX Small Ords Accumulation Index of 20.2% pa1

• DSC is a quantitatively driven absolute return manager, using

strategic and tactical investment strategies, seeking to deliver superior absolute returns uncorrelated to major asset classes.

• DSC’s strategy is aimed at giving investors access to strong

absolute returns through different market cycles .

• The DSC strategy has a 12-year track record of producing

positive investment returns over various market cycles.

• DSC is headed by Alan Sheen and Nick Selvaratnam. Before

joining Prodigy, Alan and Nick worked together at Credit Suisse where Alan was Head of Proprietary Trading and Nick was Head

• f Equities.

Long term strategy: provide a steady base of diverse ongoing m anagem ent fee revenues with potential perform ance fee upside.

Wealth Management Entrust

• Combines its deep knowledge of financial planning and portfolio management with its portfolio administration

service to create a comprehensive wealth management solution for each individual client.

• Euroz acquired Entrust Private Wealth Management (Entrust) in July 2015.
• The strategy in acquiring Entrust is to leverage an established wealth management business with long term
• ngoing revenues as a platform for further acquisitions and organic growth.
• Entrust has a significant high net worth client base with funds under management (FUM) of $6621 million.

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Entrust Priv a te W ea lth Ma na gem ent ha s a 13 y ea r tra ck record a s a lea d ing w ea lth m a na gem ent business.

Note 1: As at 31 December 2016

Investor Presentation - February 2017

Long term strategy: Entrust is our wealth m anagem ent platform that will grow FUM through organic growth and attracting external wealth advisors to join our group.

$520 $560 $600 $640 $680 31/ 12/ 2015 30/ 06/ 2016 31/ 12/ 2016 A$m Time Entrust ($662m)

Funds Under Management

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Fund s Und er Ma na gem ent increa sed by 19% in six m onths

Note 1: As at 31 December 2016

Investor Presentation - February 2017

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Fund s Ma na gem ent = $254 m illion Entrust W ea lth Ma na gem ent = $6 6 2 m illion Euroz Securities W ea lth Ma na gem ent = $227 m illion

$- $200 $400 $600 $800 $1,000 $1,200 31/ 12/ 2015 30/ 06/ 2016 31/ 12/ 2016

A$m Time

WIC ($139m) OZG ($69m) PFM ($24m) Flinders ($10m) Dalton Street ($12m) Entrust ($662m) Euroz ($227m)

Summary

• Increasing focus on funds management and wealth management capabilities.
• Improving Equity Capital Markets and stockbroking environment.
• Euroz ranked number 1 in WA based equity capital raising for 20161.
• Building diverse revenue stream s:

– Growing a consistent base of ongoing revenues from stockbroking, corporate finance, funds management and wealth management initiatives; and – Maintaining and increasing leverage through transactional upside in stockbroking and corporate finance business plus potential performance fees from growing funds management business.

• Track record of successful acquisitions, extraction of operational synergies and strong administrative support.
• Strong balance sheet of $115 million of cash and investments / NTA of 72 cents per share.
• Significant staff ownership of 44% aligns the operations of the business with the interests of shareholders.

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Grow ing a d iv ersified fina ncia l serv ices com p a ny

Source 1: WA Business News iQ

Investor Presentation - February 2017

Disclosure

Disclaim er & Disclosure Euroz Limited (EZL) and its related entities and each of their respective directors, officers and agents (together the Disclosers) have prepared the information contained in these materials in good faith. However, no warranty (express or implied) is made as to the accuracy, completeness

• r reliability of any statements, estimates or opinions or other information contained in these materials (any of which may change without

notice) and to the maximum extent permitted by law, the Disclosers disclaim all liability and responsibility (including, without limitation, any liability arising from fault or negligence on the part of any or all of the Disclosers) for any direct or indirect loss or damage which may be suffered by any recipient through relying on anything contained in or omitted from these materials. This information has been prepared and provided by Euroz Limited. To the extent that it includes any financial product advice, the advice is of a general nature only and does not take into account any individual’s objectives, financial situation or particular needs. Before making an investment decision an individual should assess whether it meets their own needs and consult a financial advisor. Past performance is not an indication of future performance.

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Investor Presentation - February 2017

Euroz Limited Level 18 Alluvion 58 Mounts Bay Rd Perth Western Australia 6000 euroz.com

Thank you