Steadfast announces 12% underlying EPS growth for first half

MARKET RELEASE 22 February 2017

Steadfast announces 12% underlying EPS growth for first half FY 17 and re-affirms FY 17 guidance

1H 17 vs 1H 16 financial highlights[1]

• Underlying revenue of $243.4m, up 8%

• Underlying EBITA of $66.7m, up 11%

• Underlying NPAT of $30.0m, up 13%

• Underlying EPS of 4.01 cents per share, up 12%

• Gross written premium (GWP) placed by Steadfast Network Brokers of $2.5bn, up 13%

• Interim dividend (fully franked) of 2.6 cents per share (cps), up 8% from 2.4 cps

Statutory NPAT of $37.9m was down 3% due to lower non-trading gains.

Managing Director & CEO Robert Kelly commented “we have delivered another strong set of results as we continue to benefit from our size and scale as Australia’s largest general insurance broker network and underwriting agency group[2].

“We are seeing the first signs of underwriters taking action to improve results and although early days, both the Network and underwriting agencies benefited from a small degree of price improvement across our primarily SME (small to medium size enterprise) customer base.

“We continue to add brokers to the Steadfast Network with 5 new brokers joining in the period with Steadfast brokers now accounting for 28% of total GWP placed in Australia[3]. Steadfast underwriting agencies performed well in 1H 17 with the London ‘super’ binder starting to benefit the group. Strong momentum is building in Steadfast Direct.

“We performed well on an organic basis with volume, margin improvement and small price increases driving broker performance. Strong acquisition growth was primarily driven by broker-related acquisitions made in the period.

“Our investment in digital platforms is benefiting brokers and agencies by delivering a streamlined user experience with cost savings delivering margin improvements. Insight and Underwritercentral continue to add users while we rolled out our Steadfast Client Trading Platform to three new insurance classes during the period.

“There continues to be a pipeline of acquisition opportunities and we remain, as ever, disciplined in our acquisition criteria and due diligence process.”

[…]

1 Statutory P&L results have been adjusted to assist in making appropriate comparisons with prior periods and to assess the operating performance of the business. Underlying P&L results excludes non-trading items.

2 Source: Steadfast Group and APRA Intermediated General Insurance Statistics (June 2016).

3 Source: Steadfast Group and APRA Intermediated General Insurance Statistics (June 2016).

1H_17_results_market_release.pdf
1H_17_results_investor_presentation.pdf
Appendix_3A.1_notification_of_dividend.pdf
Appendix_4D_and_the_half_year_2017_financial_report.pdf

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