Pacific Current Group Forecast Full Year 2021

Hi All

There has been an analyst forecast update for full year revenue flagged on Simply Wall Street as follows:
https://**.st/stocks/au/diversified-financials/asx-pac/pacific-current-group-shares/news/the-pacific-current-group-limited-asxpac-analyst-just-booste

In simple, $66M in Revenue has been forecast or $1.30 per share. If this is accurate I think we are looking at a bumper growth in earnings (Simply Wall Street has 33.5% growth in earnings), despite slowing comparative to half year 2019 to 2020.

I am assuming this is Ords. Would be great if someone could confirm if this correlates to other financial sources and is accurate.

Assuming the Revenue number is approximately accurate, which is $3.3M more than last year's $62.7M, there is a chance of larger than normal underlying NPBT. This is due to the large drop in expenses comparative year on year in the latest half year report.

$26.367M HY2019 Expenses excluding impairments
$15.737M HY2020 Expenses excluding impairments

Expenses lower by $10.63M for the half year.

If the trend for expenses continues with expense savings, we will potentially be on trend for $16M in savings from previous (reason for lower than double $10M is that the second half of FY2020 expenses was $21M). $16M is expected to be saved over the full year.

For the half year, underlying figures were down due in part to lower revenue ($29.9M in HY2019 v $23.645M in HY2020).

If this is the case and expenses stay lower, we could be looking at Underlying NPBT figure of $34.5M. If you reduce NPBT by $3M for tax, then underlying NPAT is forecast at $31.526M or 62c Earnings Per Share for FY2021. FY2020 was 50.3c Earnings Per Share. A 12c increase represents a possible 24.3% growth in EPS. If PAC management pay 75% payout ratio, then we are potentially looking at a final dividend of 35c to 36.5c at the end of this year, a full year dividend of 45c to 46.5c. This would be dividend growth of 28.6%.

There is one scenario where I think this will be be proven incorrect on the upside, the merging of Bakkt with the VIH SPAC. This could easily add $10M to PAC's bottom line.

While expenses were lower due to COVID lockdown in the US (no flying or entertaining prospective investors in funds), this could mean an increase of $1M in expenses or roughly a decrease of 2c in EPS. PAC is in good shape to deliver this year due to expense management and increasing dividends from boutiques growing exponentially.

Looking forward to what management have to say about about potential forecast. What are others thoughts.

Best of Luck
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