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2016 RESULTS
OFX is the leading internat ional payments busine ss in Australia and New Ze aland, and this positio n
was further cemented dur ing the year. We have demonstr ated our ability to sc ale in this market,
andthe opportunity to p enetrate this mar ket further remain s significant. Our newest g eography,
the United States, is also ex periencing growth , and we continue to expec t that this market will b e
our largest future market o pportunity.
OFX passed a significant miles tone in delivering net o perating income of $10 3.9million, up 15% on the
previous year. We also grew active client s by 6% to 150,900. OFX sen t money to almost 200 coun tries
on behalf of its customers. L ast year, our turnover grew to$ 19.6billion.
Notwithstanding our final o utcome we did miss the EB TDA guidance we gave at t he Annual General
Meeting, and we updated that g uidance in February w ith a slightly reduced g uidance for the full year,
which was ultimately delivered . This was due to factor s both within and outs ide of our control, princ ipally
during the third quarter. Subse quently, the factors wi thin our control have be en addressed, and we saw a
more positive fourth qua rter to the year which e nabled us to deliver full year r esults within the r eforecast
we provided. As a consequence, E xecutives gave up t heir short-term incent ive bonus, as the outco me did
not meet the hurdle rate.
During the third quarter, the Co mpany was faced with an un solicited takeover bid in t he form of
a preliminary, non-binding, indicative conditional proposal from Western Union. After careful
consideration, the Board ag reed to grant Western Un ion access to exclusive d ue diligence. In the end,
this process took a great deal lo nger than expected an d did not result in a succes sful transactio n. The
investment of time and the signi ficant distracti on created by this proc ess cannot be underes timated.
It was undoubtedly a factor tha t led to a softer thir d quarter perfor mance. The Board ack nowledges
the enormous commitment sho wn by the Executiv e Team during the process.
THE BOARD AND THE EXECUTIVE TEAM
The Board welcomed Richard Kim ber as its new CEO to OFX a t the beginning of June last y ear. Richard
has 25years of diverse global leade rship experience tha t has included several chie f executive and
board roles in the financial ser vices and technology se ctors and has extens ive experience in cons umer
financial services, marke ting, search and social me dia, as well as capital mark ets.
Richard very quickly went on to st rengthen the OFX E xecutive Team with a numb er of key appointments .
The team was boosted with t he appointment of Maria L oyez, Chief Marketi ng Officer, Adam Smith j oined
as Chief Operating Offic er to lead the global opera tions and Kirsten Pol lard was appointed as Head of
People and Culture.
Craige Pendleton-Browne was app ointed as Chief Technology Of ficer and brings a weal th of experience in
the technology sector, in part icular in software d evelopment. He has rapidly tr ansformed the tech nology
team, and it is pleasing to see the vel ocity ofdelivery al ready ramping up under Crai ge’sleadership.
Most recently, Karin Visnick has m oved from an acting role t o being appointed Execu tive Vice Presiden t –
General Manager North Amer ica. Karin has a stron g background in Silicon Valley and w as most recently
a senior product leader at eBay. Sheisba sed in our San Francisco of fice.
The Board is very pleased wi th the composition o f the entire Execut ive Team and the background, ski lls
andexperience that each memb er brings to OFX.
The Board is confident that wi th our investment s in people, technology and f acilities, the solid
foundations are now in place to deli ver on our Accelerate s trategy over the nex t three years.
CAPITAL MANAGEMENT
OFX continues to have a robus t balance sheet with noex ternal interest b earing debt and stron g cash
flow conversion. This strong fi nancial position allows u s to continue to invest in t he business to meet our
goals and execute on our Accelera te Strategy.
SHAREHOLDER RETURNS
The Board was pleased to announc e a dividend of 3.1cents p er share fully franked. T he dividend
payment will have a record date o f 10 June 2016 and a payment dat e of 24 June 2016. This brings t he
total to $16.1million for the ye ar. The Group’s dividend policy is top ay out approximately 7 0%-80% of
NPAT perannum andthis remains unchanged from l ast year.
ACKNOWLEDGEMENTS
OFX has the foundations in pla ce from which to realise it s growth potenti al and to continue to scale.
The Board is very pleased wi th the progress to da te and has confidence in the e ntire Company to delive r
the strategy it has set ou t.
On behalf of the Board and Execu tive Team, we wish to express o ur thanks to our custom ers, our
business partners and to ou r very dedicated OF X team around the world an d to you, our shareholders,
for your continued support.
CHAIRMAN’S LETTER
Dear shareholder
The past year has been one of transition for the Company and, whilst we have once
again delivered strong results, we have also weathered our challenges well.
PETER WARNE
CHAIRMAN
CHAIRMAN’S LETTER Dear shareholder The past year has been one of transition for the Company and, whilst we have once again delivered strong results, we have also weathered our challenges well. 2016 RESULTS OFX is the leading international payments business in Australia and New Zealand, and this position was further cemented during the year. We have demonstrated our ability to scale in this market, and the opportunity to penetrate this market further remains significant. Our newest geography, the United States, is also experiencing growth, and we continue to expect that this market will be our largest future market opportunity. OFX passed a significant milestone in delivering net operating income of $103.9million, up 15% on the previous year. We also grew active clients by 6% to 150,900. OFX sent money to almost 200 countries on behalf of its customers. Last year, our turnover grew to $19.6billion. PETER WARNE CHAIRMAN Notwithstanding our final outcome we did miss the EBTDA guidance we gave at the Annual General Meeting, and we updated that guidance in February with a slightly reduced guidance for the full year, which was ultimately delivered. This was due to factors both within and outside of our control, principally during the third quarter. Subsequently, the factors within our control have been addressed, and we saw a more positive fourth quarter to the year which enabled us to deliver full year results within the reforecast we provided. As a consequence, Executives gave up their short-term incentive bonus, as the outcome did not meet the hurdle rate. During the third quarter, the Company was faced with an unsolicited takeover bid in the form of a preliminary, non-binding, indicative conditional proposal from Western Union. After careful consideration, the Board agreed to grant Western Union access to exclusive due diligence. In the end, this process took a great deal longer than expected and did not result in a successful transaction. The investment of time and the significant distraction created by this process cannot be underestimated. It was undoubtedly a factor that led to a softer third quarter performance. The Board acknowledges the enormous commitment shown by the Executive Team during the process. THE BOARD AND THE EXECUTIVE TEAM The Board welcomed Richard Kimber as its new CEO to OFX at the beginning of June last year. Richard has 25 years of diverse global leadership experience that has included several chief executive and board roles in the financial services and technology sectors and has extensive experience in consumer financial services, marketing, search and social media, as well as capital markets. Richard very quickly went on to strengthen the OFX Executive Team with a number of key appointments. The team was boosted with the appointment of Maria Loyez, Chief Marketing Officer, Adam Smith joined as Chief Operating Officer to lead the global operations and Kirsten Pollard was appointed as Head of People and Culture. Craige Pendleton-Browne was appointed as Chief Technology Officer and brings a wealth of experience in the technology sector, in particular in software development. He has rapidly transformed the technology team, and it is pleasing to see the velocity of delivery already ramping up under Craige’s leadership. Most recently, Karin Visnick has moved from an acting role to being appointed Executive Vice President – General Manager North America. Karin has a strong background in Silicon Valley and was most recently a senior product leader at eBay. She is based in our San Francisco office. The Board is very pleased with the composition of the entire Executive Team and the background, skills and experience that each member brings to OFX. The Board is confident that with our investments in people, technology and facilities, the solid foundations are now in place to deliver on our Accelerate strategy over the next three years. CAPITAL MANAGEMENT OFX continues to have a robust balance sheet with no external interest bearing debt and strong cash flow conversion. This strong financial position allows us to continue to invest in the business to meet our goals and execute on our Accelerate Strategy. SHAREHOLDER RETURNS The Board was pleased to announce a dividend of 3.1 cents per share fully franked. The dividend payment will have a record date of 10 June 2016 and a payment date of 24 June 2016. This brings the total to $16.1million for the year. The Group’s dividend policy is to pay out approximately 70%-80% of NPAT per annum and this remains unchanged from last year. ACKNOWLEDGEMENTS OFX has the foundations in place from which to realise its growth potential and to continue to scale. The Board is very pleased with the progress to date and has confidence in the entire Company to deliver the strategy it has set out. On behalf of the Board and Executive Team, we wish to express our thanks to our customers, our business partners and to our very dedicated OFX team around the world and to you, our shareholders, for your continued support.