Reporting Summary

Computershare Limited (CPU)

1H Year Results – Released 15/02/17

  • Beat consensus estimates for NPAT but missed on sales

Financial Results

  • Revenue of US$999.1m missed consensus estimates of $US$1.02b
  • Management EBITDA of US$241.3m reported was lower than consensus estimates of US$243.7m
  • Management EPS of US 27.12 cps reported was better than US25.98 cps from a year ago
  • Statutory EPS reported was US27.48 cps was 80.6% higher than US15.22 cps from a year ago
  • Statutory NPAT of US$150.2m was better than US$84.3m compared to a year ago
  • Interim dividend of A17 cps, 30% franked payable on 22 March

Operational Key Points

  • Encouraging growth in mortgage services UKAR integration progressing well and US building towards scale
  • Register maintenance EBITDA improved on slightly lower revenues with margins up through cost management
  • Weak corporate actions, revenue down 16%
  • Plans EBITDA up 18% aided by stronger translation volumes
  • Phase 1 and 2 cost out programs underway, US$85 to US$100m total cost out target affirmed
  • Client balances US$16.6b, margin income US$69.9m compared to US$79m in the pcp
  • Recycling capital to drive growth, scale and improved returns
  • Disciplined acquisition strategy focused on near verticals and core competencies
  • Transformation to a more transparent, disciplined and profitable CPU continues

Management Outlook

  • Expectation that EPS for FY17 will be between 56c to 58c compared to 55.09c in FY16
  • The outlook assumes that equity markets remain at current levels, interest rate markets perform in line with current market expectations and that FY17 corporate actions revenue is similar to FY16

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Michael Ron

Research Analyst

Michael has been trading equities since 2003 and since joining DJ Carmichael in 2004 has worked in numerous roles in operations, trading, compliance and research. Michael’s expertise is in trading and equity strategy using a combination of both technical and fundamental analysis.

Michael holds a Graduate Diploma in Applied Finance, Diploma of Financial Markets, Diploma of Financial Planning, Advanced Diploma of Business Administration and is currently studying towards a Master of Applied Finance.