Insignia Financial : 1H22 Investor & Analyst Pack and Investor & Analyst Book

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ASX release - 24 February 2022

Insignia Financial Investor and Analyst Pack and Book

Insignia Financial today releases its Investor and Analyst Pack - a detailed template for presenting Insignia Financial's corporate financial information. This financial information covers 1H22 and the comparative periods FY19, FY20 and FY21 in a half-on-half view. All information is presented on a continuing operations basis.

Included with the Pack is the Investor and Analyst Book, which provides an overview of Insignia Financial's business reporting segments and additional details on the composition of segments and material drivers of gross margin and profitability, as well as additional detail on the 1H22 result by business unit.

An excel version of Insignia Financial's Analyst and Investor Pack will be available online at https://www.insigniafinancial.com.au/shareholders/performance-and-reporting/reports-and-results

- Ends -

This announcement was approved for release by the Board of Insignia Financial Ltd.

Investor Enquiries	Media Enquiries
Andrew Ehlich	Kristen Allen
GM Capital Markets	GM Corporate Affairs
Insignia Financial	Insignia Financial
M: [phone]	M: [phone]
E: [e-mail]	E: [e-mail]

About Insignia Financial Ltd

Insignia Financial has been helping Australians secure their financial future since 1846. During that time, we have grown substantially to become one of the largest groups in the financial services industry.

Insignia Financial provides advisers and their clients with the following services:

• Platforms for advisers, their clients and hundreds of employers in Australia;
• Advice services via our extensive network of financial advisers; and
• Asset Management products that are designed to suit any investor's needs.

Further information about Insignia Financial can be found at www.insigniafinancial.com.au

Insignia Financial Ltd	Level 1, 800 Bourke Street	GPO Box 264 Melbourne VIC 3001
ABN 49 100 103 722	Melbourne VIC 3000	Phone 13 13 69

For personal use only

Insignia Financial Ltd

Insignia Financial Investor and Analyst Pack - Important Disclaimer

Important information

This analyst pack has been prepared by Insignia Financial Ltd ABN 49 100 103 722 (Insignia Financial). It is general information on Insignia Financial and its subsidiaries (Insignia Financial Group) current as at 24 February 2022.

It is in summary form and is not necessarily complete. It should be read together with Insignia Financial's condensed consolidated interim financial report for the half year ended 31 December 2021 lodged with the ASX on 24 February 2022 (Half Year Report). Information and statements in this pack do not constitute investment advice or a recommendation in relation to Insignia Financial or any product or service offered by Insignia Financial or any of its subsidiaries and should not be relied upon for this purpose. Prior to making a decision in relation to Insignia Financial's securities, products or services, investors or clients and potential investors or clients should consider their own investment objectives, financial situation and needs and obtain professional advice.

The information in this presentation may include information contributed by third parties. Insignia Financial Group does not warrant the accuracy or completeness of any information contributed by a third party. No representation or warranty is made as to the accuracy, adequacy or reliability of any statements, estimates, opinions or other information contained in the presentation (any of which may change without notice). To the extent permitted by law, no liability is accepted for any loss or damage as a result of any reliance on this presentation. Past performance is not indicative of future performance.

This presentation contains forward looking statements, including statements regarding Insignia Financial's intent, objective, belief or current expectation relating to Insignia Financial's businesses and operations, market conditions or results of operations and financial condition, including any statements related to or affected by the ongoing impact of the COVID-19 pandemic and remediation programs. These are based on Insignia Financial's current expectations about future events and is subject to known and unknown risks and uncertainties, many of which are beyond the control of the Insignia Financial Group. Actual events may differ materially from those contemplated in such forward looking statements and could cause actual results, performance or events to differ materially from those express or implied. Forward looking statements are not guarantees or representations about future performance and should not be relied upon as such.

Insignia Financial does not undertake to update any forward-looking statement to reflect events or circumstances after the date of this presentation, subject to its regulatory and disclosure requirements.

Underlying net profit after tax pre amortisation (UNPAT) attributable to equity holders of Insignia Financial reflect an assessment of the result for the ongoing business of the Insignia Financial Group as determined by the Board and management. UNPAT has been calculated with regard to ASIC's Regulatory Guide 230 Disclosing non-IFRS financial information and the adjustments to NPAT are set out on pages 7 and 8 of the 31 December 2021 Interim Financial Report. UNPAT attributable to equity holders of Insignia Financial has not been reviewed or audited by the Group's external auditors, however the adjustments to NPAT attributable to equity holders of Insignia Financial have been extracted from the books and records that have been reviewed by the external auditor. UNPAT is disclosed as it is useful for investors to gain a better understanding of Insignia Financial's financial results from normal operating activities.

Nothing in this presentation should be construed as either an offer to sell or solicitation of an offer to buy or sell Insignia Financial Group securities or units in any fund referred to in this presentation in any jurisdiction. The Product Disclosure Statement (PDS) for these funds are issued by the applicable members of the Insignia Financial Group. The applicable PDS should be considered before deciding whether to acquire or hold units in a fund and can be obtained by calling 1800 913 118 or visiting our website www.insigniafinancial.com.au

All references to currency in this presentation are to Australian currency, unless otherwise stated. Certain figures may be subject to rounding differences.

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Insignia Financial Ltd

For personal use only

Group Result - Key Measures

Historical period restatements shown in italics - restatements relate to:

• Update to FUMA methodology (FUMA section)
• Inclusion of equity accounted profits and other revenue in gross margin (cost to income ratio)
• Restatement of 1H21 NPAT for completion of Wealth Central purchase price allocation (NPAT & EPS sections)

Average FUMA is now calculated on a six month rolling average basis and has been applied for the periods of historical restatements

Historical error in 2H20 dividend corrected

Totals subject to rounding

	1H19	2H19	1H20	2H20	1H21	2H21	1H22		1H21 v 1H22
NPAT
UNPAT ($m)	99.9	98.1	61.4	67.5	65.9	81.9	117.9	52.0	78.8%
UNPAT (Continuing Operations) ($m)	92.5	90.8	56.5	67.5	65.9	81.9	117.9	52.0	78.8%
Statutory NPAT ($m)	135.4	(106.9)	115.0	26.2	53.8	(197.3)	36.2	(17.6)	(32.7%)
Statutory NPAT (Continuing Operations) ($m)	69.6	(99.4)	27.8	25.2	53.8	(197.3)	36.2	(17.6)	(32.7%)
FUMA
Closing FUMA ($b)	60.8	66.6	69.1	107.6	111.6	318.7	325.8	214.2	large
Closing FUMA (Continuing Operations) ($b)	60.2	66.0	68.5	107.6	111.6	318.7	325.8	214.2	large
Average FUMA (Continuing Operations) ($b)	53.4	63.4	67.5	106.5	109.3	163.4	321.7	212.5	large
Net Flows (Continuing Operations) ($b)	0.4	0.4	0.5	(0.2)	(2.9)	(0.4)	(2.3)	0.6	20.4%
EPS
UNPAT EPS (cents per share)	28.5	28.0	17.5	19.3	12.4	12.6	18.2	5.8	46.8%
UNPAT EPS (Continuing Operations) (cents per share)	26.4	25.9	16.1	19.3	12.4	12.6	18.2	5.8	46.8%
Basic EPS (cents per share)	38.6	(30.5)	32.8	7.5	10.1	(30.4)	5.6	(4.6)	(44.9%)
Diluted EPS (cents per share)	38.5	(30.4)	32.8	7.5	10.1	(30.3)	5.6	(4.6)	(45.0%)
Basic EPS (Continuing Operations) (cents per share)	19.9	(28.4)	7.9	7.2	10.1	(30.4)	5.6	(4.6)	(44.9%)
Dividends
Ordinary dividends declared ($m)	89.4	42.2	56.2	40.4	51.9	61.7	76.6	24.7	47.5%
Ordinary dividends declared (cents per share)	25.5	12.0	16.0	11.5	8.0	9.5	11.8	3.8	47.5%
Special dividends declared ($m)	-	-	24.6	-	22.7	13.0	-	(22.7)	(100.0%)
Special dividends declared (cents per share)	-	-	7.0	-	3.5	2.0	-	(3.5)	(100.0%)
Payout ratio	89.6%	43.0%	91.5%	59.9%	78.8%	75.3%	65.0%	(13.8%)	(17.5%)
Share Price
Opening share price	$8.99	$5.17	$5.17	$7.86	$4.92	$3.52	$4.27	($0.65)	(13.2%)
Closing share price	$5.17	$5.17	$7.86	$4.92	$3.52	$4.27	$3.62	$0.10	2.8%
Total shareholder return	($3.57)	$0.12	$2.92	($2.83)	($1.29)	$0.87	($0.53)	$0.75	58.6%
Total shareholder return (%)	(39.7%)	2.3%	56.5%	(35.9%)	(26.1%)	24.6%	(12.5%)	13.7%
Ratios
Cost to income	51.6%	53.5%	62.4%	65.6%	68.3%	68.4%	73.1%	4.8%
Return on equity	10.9%	10.9%	7.2%	7.9%	5.7%	6.1%	9.4%	3.8%

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Insignia Financial Ltd

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Underlying Group Result - P&L Summary (Continuing Operations)

Revenue shown inclusive of Other Revenue and Equity Accounted Profits
Totals subject to rounding
	1H19	2H19	1H20	2H20	1H21	2H21	1H22		1H21 v 1H22
	$m	$m	$m	$m	$m	$m	$m		$m	%
Revenue	469.7	510.7	487.2	577.1	597.5	667.0	1,139.5		542.0	90.7%
Direct Costs	(209.0)	(259.3)	(233.0)	(242.8)	(246.7)	(247.8)	(361.1)		(114.4)	(46.3%)
Gross Margin	260.7	251.4	254.2	334.2	350.8	419.2	778.4	427.6	large
Operating Expenditure	(149.3)	(157.6)	(163.7)	(220.7)	(239.8)	(286.8)	(569.2)	(329.4)	large
Net Non-cash	(8.9)	(5.0)	(12.4)	(14.6)	(14.9)	(17.2)	(28.9)	(14.0)	(94.4%)
Net Interest	27.7	36.5	1.0	(3.9)	(3.4)	(3.8)	(15.2)	(11.8)	large
Income Tax Expense/Non-controlling Interest	(37.7)	(34.5)	(22.6)	(27.4)	(26.7)	(29.6)	(47.2)	(20.5)	(76.6%)
UNPAT	92.5	90.8	56.5	67.5	65.9	81.9	117.9		52.0	78.8%

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Underlying Group Result - P&L Detail

Totals subject to rounding

Gross Margin

Management and Service fees revenue Other Fee Revenue

Service and Marketing fees expense Other Direct Costs

Amortisation of deferred acquisition costs Stockbroking revenue

Stockbroking service fees Dividends and distributions received

Net fair value gains/(losses) on other financial assets at fair value through profit or loss

Other revenue

Share of profits of associates and jointly controlled entities accounted for using the equity method

Total Gross Margin

1H19	2H19	1H20	2H20	1H21	2H21	1H22
$m	$m	$m	$m	$m	$m	$m
445.6	480.9	458.2	543.9	570.3	637.5	1,094.2
17.4	21.1	23.1	28.2	25.8	23.7	30.5
(196.5)	(246.3)	(219.0)	(220.6)	(224.9)	(219.7)	(326.2)
(12.4)	(12.9)	(14.0)	(22.2)	(21.8)	(28.0)	(34.9)
(0.1)	(0.1)	(0.0)	(0.0)	(0.0)	(0.1)	-
2.3	2.3	1.7	1.6	1.7	1.7	2.6
(0.6)	(0.7)	(0.7)	(0.6)	(0.5)	(0.5)	(0.7)
0.7	0.6	0.8	0.6	0.3	0.4	0.2
-	0.1	0.0	(0.1)	0.0	0.2	1.5
4.3	6.3	4.2	3.7	0.7	4.3	5.1
0.0	0.0	(0.1)	(0.4)	(0.7)	(0.3)	6.1
260.7	251.4	254.2	334.2	350.8	419.2	778.4

1H21 v 1H22

$m $m

1. 91.8%

1. 18.2%

(101.3) (45.1%)

(13.1) (59.8%)

0.0 100.0%

1.0 57.6%

(0.2) (29.6%)

(0.1) (20.0%)

1.5 large

4.5 large

1. n/m

1. large

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For personal use only

Underlying Group Result - P&L Detail (continued)

Totals subject to rounding
	1H19	2H19	1H20	2H20	1H21	2H21	1H22		1H21 v 1H22
	$m	$m	$m	$m	$m	$m	$m		$m	%
Operating Expenditure
Salaries and related employee expenses	(95.3)	(100.1)	(108.6)	(159.4)	(178.2)	(210.8)	(380.5)	(202.2)	large
Employee defined contribution plan expense	(7.3)	(7.8)	(8.5)	(10.0)	(10.7)	(13.7)	(27.1)	(16.5)	large
Information technology costs	(17.7)	(18.9)	(19.9)	(20.3)	(21.1)	(23.5)	(71.1)	(50.0)	large
Professional fees	(4.5)	(5.3)	(4.4)	(11.0)	(9.6)	(14.8)	(38.2)	(28.6)	large
Marketing	(5.6)	(5.0)	(6.6)	(2.8)	(2.2)	(4.0)	(5.0)	(2.9)	large
Office support and administration	(7.2)	(8.5)	(9.0)	(12.6)	(13.4)	(14.6)	(28.5)	(15.1)	large
Occupancy related expenses	(8.8)	(9.3)	(3.0)	(3.8)	(4.1)	(5.2)	(16.6)	(12.5)	large
Travel and entertainment	(3.2)	(2.9)	(3.6)	(1.0)	(0.5)	0.1	(0.5)	(0.1)	(16.9%)
Other	0.3	0.0	(0.0)	-	-	(0.3)	(1.7)		(1.7)	n/m
Total Operating Expenditure	(149.3)	(157.6)	(163.7)	(220.7)	(239.8)	(286.8)	(569.2)	(329.4)	large
Net non cash (Ex. Amortisation from acquisitions)
Share based payments expense	(4.4)	(0.4)	(1.8)	(1.2)	(1.2)	(1.0)	(1.0)	0.2	15.1%
Depreciation of property, plant and equipment	(4.1)	(4.3)	(10.2)	(13.0)	(13.4)	(15.8)	(19.5)	(6.1)	(45.8%)
Amortisation of intangible assets - IT development	(0.4)	(0.4)	(0.4)	(0.4)	(0.4)	(0.4)	(0.6)	(0.3)	(75.5%)
Impairment - Investments	-	-	-	-	-	-	(7.8)		(7.8)	n/m
Total Net non cash (Ex. Amortisation from acquisitions)	(8.9)	(5.0)	(12.4)	(14.6)	(14.9)	(17.2)	(28.9)	(14.0)	(94.4%)
Net Interest
Interest income on loans to directors of controlled and associated entities	0.1	0.1	0.1	0.0	-	0.0	(0.0)	(0.0)	n/m
Interest income on financial assets measured at fair value	-	-	-	-	-	0.3	(0.0)	(0.0)	n/m
Interest income from non-related entities	32.4	44.5	8.7	2.5	2.0	1.5	2.4	0.4	20.4%
Loss on financial instruments	-	-	-	-	-	-	(2.2)	(2.2)	n/m
Finance Costs	(4.8)	(8.1)	(7.8)	(6.5)	(5.4)	(5.6)	(15.4)		(9.9)	large
Total Net Interest	27.7	36.5	1.0	(3.9)	(3.4)	(3.8)	(15.2)	(11.8)	large
Income Tax & NCI
Non-controlling Interest	0.1	0.1	0.6	(0.4)	0.0	0.0	(0.1)	(0.1)	n/m
Income tax expense	(37.9)	(34.6)	(23.2)	(27.1)	(26.7)	(29.6)	(47.1)	(20.4)	(76.3%)
Total Income Tax & NCI	(37.7)	(34.5)	(22.6)	(27.4)	(26.7)	(29.6)	(47.2)	(20.5)	(76.6%)
Underlying NPAT excluding Discontinued Operations	92.5	90.8	56.5	67.5	65.9	81.9	117.9		52.0	78.8%
Discontinued Operations - Corporate Trust
(0.2)	(0.1)	-	-	-	-	-		-	n/m
Discontinued Operations - Ord Minnett	6.6	6.7	3.6	-	-	-	-	-	n/m
Discontinued Operations - IOOF NZ	0.5	0.2	0.2	(0.1)	-	-	-	-	n/m
Discontinued Operations - PVM	0.4	0.5	1.0	-	-	-	-	-	n/m
Underlying NPAT (pre-amortisation of intangible assets)	99.9	98.1	61.4	67.5	65.9	81.9	117.9		52.0	78.8%

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