Salmat : 2020 Half Year Results Presentation

SALMAT

FY20 HALF YEAR RESULTS

FEBRUARY 2020

1H20 SUMMARY

Sale of businesses, looking at how to return value to shareholders

$25m sale of Marketing Solutions to IVE Group Limited

Successfully completed sale of AU and NZ (Reach Media) catalogue business on 1 January 2020.

Business separation progressing

Transition services in place. Separation largely relates to administrative issues.

MicroSourcing sale completion

$100m sale to Probe BPO Holdings on track to complete on 28 February 2020.

Returning funds to shareholders

Board is currently seeking advice on the best way to return value to all shareholders.

MicroSourcing sale approved

Shareholders voted in favour of MicroSourcing sale at general meeting on 21 February 2020.

Salmat Limited 1H20 results presentation

Future plans will be announced once confirmed

We will update the market once discussions with our advisors have concluded.

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MARKETING SOLUTIONS DISCONTINUED OPERATIONS

(1,060)

Salmat Limited 1H20 results presentation		3

MICROSOURCING DISCONTINUED OPERATIONS

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BALANCE SHEET

$ million	Dec-19	Jun-19	% change
Cash and cash equivalents	45.7	59.2	-22.7%
Trade and other receivables	2.3	26.9	-91.4%
Fixed assets	0.0	7.1	-100.0%
Goodwill & intangibles	0.0	22.7	-100.0%
Other	2.4	14.5	-83.2%
Assets held for sale	88.5	0.0	NMF
Total Assets	139.0	130.4	6.6%
Current liabilities	4.3	28.0	-84.5%
Other non-current liabilities	0.0	4.9	-100.0%
Liabilities held for sale	56.9	0.0	NMF
Total Liabilities	61.2	32.9	86.2%
Equity	77.8	97.5	-20.2%

Salmat Limited 1H20 results presentation

• Cash of $45.7 million at the end of the period after paying $10.0 million in dividends in October 2019.
• Assets & Liabilities held for sale includes both Marketing Solutions and MicroSourcing.
• Deferred tax assets have been written down to reflect the Group's tax position.

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CASH FLOW SUMMARY

$ million
Net cash at 30 June 2019	59.2
Operating cash inflow	2.2
Tax payments	(3.1)
Capex & intangibles	(1.1)
Net financing costs (incl interest)	0.2
Costs associated with sale of business	(1.1)
Movement in borrowings	(0.6)
Dividends and Share Capital movements	(10.0)
Foreign exchange movements	0.1
Net cash 31 December 2019	45.7

Salmat Limited 1H20 results presentation

• Operating cash flows reduced from the prior period due to $1.2 million restructuring costs, $0.45 million insurance premiums and $0.9 million technology contracts that were not financed in FY20.
• Tax payments inclusive of $2.7 million in WHT paid on overseas dividends as cash was repatriated from MicroSourcing.
• Advisory costs of $1.1 million paid during the period for the sale of businesses, with further payments to be made.
• Special dividend of $10.0 million paid to shareholders in October 2019.

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SUMMARY

Rewarding shareholders for their support

• Achieved best possible price for Marketing Solutions and MicroSourcing in the current market.
• Marketing Solutions sale successfully completed and MicroSourcing sale due to complete soon.
• Separation process for both largely involve administration tasks. Will not be prolonged.
• Board looking at how to optimise returns for all shareholders in distributing surplus funds.
• Salmat will update the market once future plans have been confirmed.

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DISCLAIMER

Company announcements and presentations can contain forward-looking statements. Words such as "believe", "anticipate", "plan", "expect", "intend", "target", "estimate", "project", "predict", "forecast", "guideline", "should", "aim" and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements.

Forward-looking statements involve inherent risks and uncertainties. We caution you that a number of important factors could cause actual results to differ materially from the plans, objectives, expectations, estimates and intentions expressed in such forward-looking statements. These factors include but are not limited to: competition and product pricing in the markets in which we operate; general economic and market conditions; compliance with, and possible changes in, environmental and health and safety laws; dependence on cyclical markets; the supply and cost of materials; exposure to environmental or other legal proceedings; and risks of conducting business internationally. We caution you that the foregoing list of factors is not exclusive and that other risks and uncertainties may cause actual results to differ materially from those contained in forward-looking statements. Forward-looking statements speak only as of the date they are made.

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THANK YOU

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