One of the most unusual statutory presentations of FY23 results by SEQ, and one which has being unappreciated by analysts.

For starters, the company elected to display the Morrison results on one line - basically as net profits from disposed of division’.

so when you read the actuals presented by Refinifiv and others, it totally distorts a number of key indicators - such as rev, EBITDA increases or decreases etc.

Yes, Garry Croll covered these in his presentations and videos, along with a string of adjustments to get ‘normalised’ results (which I hate, particularly since this now appears to be an annual inclusion).

The results were lousy - we were prepared for that - and the future looks much brighter - but go back one year and GC was similarly optimistic. I like GC, I do, but he is now on watch to ensure the FY24 actuals back up the vision.

I do like his quirky invention of ROME - Return on Managements Estimates (of the value of the sum of the parts). Currently he sees the sum of the parts adding up to $135m against a market cap of around $70m

i did stump up and buy more in RL because of the value of the grossed up special dividend and the cash warchest following Morrison completion and his mentioning strong performances in the final months of FY23 and continuing into July and August. Plus increasing your pool of financial advisors by 5% when the industry lost 35% says they must be regarded highly..

But, I will be watching their approach to deploying the cash.

I think this acquisition (March 29) by SEQ is strategically very smart. Effectively, it buys a large base of individual investors via Share Café and it will marry them with its full suite of products and advisor network. The ‘lifetime value’ of these customers can be massive with so many products/services to cross sell.  

Plus, I like the thought of working all sides of the investment ‘carcass’. That is, providing advice to investors whilst moving them into the SEQ ‘revenue chain’ at a low cost of acquisition, services to advisors, and marketing and awareness strategies to listed entities. Preservation of independence will be crucial though, as we all know the worth of the research reports produced by the ‘guns for hire’ analysts.

 The informed investor acquisition, in particular, will really assist with the advisor network as the product looks relatively sticky.

Overall, I am impressed by Garry Croll the MD, he goes quietly about his business whilst executing a very smart strategy, he is transparent and cogent in what he says, and he is working his cash surpluses brilliantly.  

 This deal has been struck at 5X FY23 EBITDA – okay - and I believe with just a 10% organic growth over likely FY22 results, plus this acquisition will see FY23 EPS at around 6c to 7c and growing. His combo of shares and cash is okay by me because it ensures the vendors are roped in for at least two years to bed down the acquisitions. Plus, they are impressive people to have onboard.