Janus Henderson Group Plc · NYSE:JHG
Janus Henderson — Q2 2021 Earnings Presentation
39 slides from Janus Henderson's earnings presentation, Jul 29, 2021
Slide 1: Second Quarter 2021 Results
Thursday 29 July 2021 SECOND QUARTER 2021 RESULTS Dick Weil Chief Executive Officer Roger Thompson Chief Financial Officer
Slide 2: Key metrics – Q2 2021 vs Q1 2021
2 1 Represents percentage of AUM outperforming the relevant benchmark. Full performance disclosures detailed in the appendix on slide 24. 2 See adjusted financial measures reconciliation on slides 30 and 31 for additional information. Key metrics – Q2 2021 vs Q1 2021 Q2 2021 RESULTS ▪ Long-term inve
Slide 3: Our Strategy: Simple Excellence
3 OUR STRATEGY: SIMPLE EXCELLENCE Strengthening our core foundation while maximising growth potential Delivering on our strategy of Simple Excellence Produce dependable investment outcomes Excel in distribution and client experience Develop new growth initiatives Focus and increase operational effic
Slide 4: Develop New Growth Initiatives
4 DEVELOP NEW GROWTH INITIATIVES Focus areas for growth Active ETFs Alternatives Asia ESG Fixed Income ▪ Small but growing and well-recognised set of capabilities in active fixed income ETFs ▪ Innovative pipeline includes pioneering ETFs (e.g. AAA CLO) and sustainable equity ETFs leveraging strong i
Slide 5: Business and Financial Update
BUSINESS AND FINANCIAL UPDATE Roger Thompson Chief Financial Officer
Slide 6: Investment Performance
6 INVESTMENT PERFORMANCE Note: Full performance disclosures detailed in the appendix on slides 24 and 25. The top two Morningstar quartiles represent funds in the top half of their category based on total return. The top quartile represents those in the top 25%. Refer to slide 25 for the 10-year per
Slide 7: Total Flows
7 15.6 15.3 18.7 21.4 17.9 15.8 23.2 20.7 18.4 (25.4) (18.8) (25.4) (33.6) (26.1) (18.7) (24.3) (24.0) (20.9) (9.8) (3.5) (6.7) (12.2) (8.2) (2.9) (1.1) (3.3) (2.5) Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 2019 to Q2 2021 total flows (US$bn) Redemptions Sales Net sa
Slide 8: Quarterly Flows by Client Type
8 4.2 3.7 8.8 3.3 4.2 (12.7) (5.6) (10.0) (6.8) (6.0) (8.5) (1.9) (1.2) (3.5) (1.8) Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 13.0 11.5 13.5 16.5 13.5 (12.1) (11.6) (12.5) (15.4) (13.5) 0.9 (0.1) 1.0 1.1 - Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 0.7 0.6 0.9 0.9 0.7 (1.3) (1.5) (1.8) (1.8) (1.4) (0.6)
Slide 9: Q2 2021 Flows by Capability
9 1 Annualised gross sales and redemption rates calculated as a percentage of beginning period AUM. Q2 2021 FLOWS BY CAPABILITY Net flows reflect strength in Multi-Asset and Alternatives 8.6 5.9 2.4 0.2 1.3 (10.5) (6.0) (1.9) (1.5) (1.0) (1.9) (0.1) 0.5 (1.3) 0.3 Equities Fixed Income Multi-Asset Qu
Slide 10: Statement of Income: US GAAP and Adjusted
10 US GAAP Adjustments Adjusted Revenue Management fees 544.1 (49.6) 494.5 Performance fees 77.4 – 77.4 Shareowner servicing fees 64.0 (53.1) 10.9 Other revenue 52.9 (32.1) 20.8 Total revenue 738.4 (134.8) 603.6 Operating expenses Employee compensation and benefits 192.4 – 192.4 Long-term incentive
Slide 11: Summary Financial Results
11 (US$, except margin data) Q2 2021 Q1 2021 Change Q2 2021 vs Q1 2021 Q2 2020 Change Q2 2021 vs Q2 2020 Average AUM 420.8bn 405.3bn 4% 323.0bn 30% Total revenue 738.4m 644.0m 15% 518.0m 43% Operating income 225.0m 192.5m 17% 106.7m nm Operating margin 30.5% 29.9% 0.6ppt 20.6% 9.9ppt US GAAP diluted
Slide 12: Revenue
12 REVENUE Q2 2021 adjusted revenue reflects higher average assets and seasonally higher performance fees Note: See adjusted financial measures reconciliation on slides 30 and 31 for additional information. 1 Net margin based on management fees net of distribution expenses. Adjusted revenue – Q1 202
Slide 13: Performance Fees
13 PERFORMANCE FEES Performance in several strategies drove the quarter-over-quarter and year-over-year improvement Performance fee detail (US$m) ▪ SICAV performance fees of US$50m primarily resulting from quarterly fees in Absolute Return and annual fees in several strategies primarily in European
Slide 14: Operating Expenses
14 OPERATING EXPENSES Note: See adjusted financial measures reconciliation on slides 30 and 31 for additional information. Adjusted operating expenses – Q1 2021 vs Q2 2021 (US$m) 334.3 (3.7) (0.5) 315.1 17.8 0.5 0.5 4.6 Q1 2021 Compensation and benefits LT incentive plans Investment administration M
Slide 15: Capital Resources
15 CAPITAL RESOURCES Strong liquidity position ▪ Cash and investment securities (excluding those assets held by consolidated VIEs and VREs1) totalled US$1,200m compared to outstanding debt of US$312m ▪ Board declared a dividend of US$0.38 per share to be paid on 25 August to shareholders on record a
Slide 16: Q&A
Q&A Janus Henderson
Slide 17: Appendix
APPENDIX GROUP PLC
Slide 18: Assets Under Management
18 ASSETS UNDER MANAGEMENT AUM as at 30 June 2021: US$427.6bn 56% 19% 13% 10% 2% Equities Fixed Income Multi-Asset Quantitative Equities Alternatives 48% 31% 21% Intermediary Institutional Self-Directed 55% 31% 14% North America EMEA & LatAm Asia Pacific By client type By capability By client locati
Slide 19: Investment Management Capabilities
19 INVESTMENT MANAGEMENT CAPABILITIES Diversified product range Equities US$240.1bn AUM 30 Jun 21 US$427.6bn Fixed Income US$80.5bn Multi-Asset US$53.2bn Self-Directed Intermediary Institutional Institutional Institutional Quantitative Equities US$43.4bn Institutional Alternatives US$10.4bn Intermed
Slide 20: Largest Strategies by Capability
20 LARGEST STRATEGIES BY CAPABILITY Note: Numbers may not cast due to rounding. Capability Strategy AUM (US$bn) 30 Jun 21 US Mid Cap Growth 30.4 US Concentrated Growth 29.6 US Research Growth Equity 21.9 Global Life Sciences 14.9 US SMID Cap Growth 14.2 Absolute Return Income 11.8 Global Strategic F
Slide 21: Quarterly Flows by Capability: Equities and Fixed Income
21 7.9 5.8 10.3 10.5 8.6 (12.1) (10.9) (10.4) (12.0) (10.5) (4.2) (5.1) (0.1) (1.5) (1.9) Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Equities (US$bn) 1 Annualised gross sales and redemption rates calculated as a percentage of beginning period AUM. QUARTERLY FLOWS BY CAPABILITY Equities and Fixed Income
Slide 22: Quarterly Flows by Capability: Multi-Asset, Quant, Alternatives
22 0.4 1.3 0.3 0.2 0.2 (4.3) (1.4) (3.7) (2.3) (1.5) (3.9) (0.1) (3.4) (2.1) (1.3) Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 2.5 2.3 3.1 3.0 2.4 (1.8) (1.7) (1.9) (2.2) (1.9) 0.7 0.6 1.2 0.8 0.5 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 0.8 0.5 0.8 1.1 1.3 (0.9) (0.6) (0.8) (2.0) (1.0) (0.1) (0.1) - (0.
Slide 23: Net Flows by Capability
23 Q2 2019 Q3 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Equities Fixed Income Multi-Asset Quantitative Equities Alternatives Q2 2019 to Q2 2021 total net flows by capability (US$bn) NET FLOWS BY CAPABILITY (12.2) (9.8) (3.5) (6.7) (8.2) (2.9) (1.1) (3.3) (2.5)
Slide 24: Investment Performance
24 Note: Outperformance is measured based on composite performance gross of fees vs primary benchmark, except where a strategy has no benchmark index or corresponding composite in which case the most relevant metric is used: (1) composite gross of fees vs zero for absolute return strategies, (2) fun
Slide 25: Investment Performance
25 INVESTMENT PERFORMANCE Note: Includes Janus Investment Fund, Janus Aspen Series and Clayton Street Trust (US Trusts), Janus Henderson Capital Funds (Dublin based), Dublin and UK OEIC and Investment Trusts, Luxembourg SICAVs and Australian Managed Investment Schemes. The top two Morningstar quarti
Slide 26: Investment Performance: Top Morningstar Quartiles
26 INVESTMENT PERFORMANCE % of mutual fund AUM in top 2 Morningstar quartiles (continued) Group 42 32 17 10 21 46 48 44 44 42 41 41 40 42 41 25 36 41 27 12 22 26 22 24 26 37 37 31 26 14 67 68 57 37 33 67 74 66 67 67 78 78 71 68 55 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 2020 Q3 2020 Q4 2020 Q1 20
Slide 27: Investment Performance: Fixed Income and Multi-Asset
27 INVESTMENT PERFORMANCE % of mutual fund AUM in top 2 Morningstar quartiles (continued) 2nd quartile 1st quartile Fixed Income Multi-Asset 41 56 54 27 30 64 67 71 69 71 41 49 49 38 40 36 19 16 43 27 23 11 8 11 9 33 24 24 35 35 77 76 70 69 57 86 78 79 79 80 74 72 73 73 75 Q2 2020 Q3 2020 Q4 2020 Q1
Slide 28: Investment Performance: Quantitative Equities and Alternatives
28 4 7 4 4 4 4 7 3 4 4 4 7 3 4 32 34 56 26 29 28 40 4 3 4 4 32 41 60 30 33 32 47 8 4 4 4 7 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 64 43 0 19 0 32 72 41 74 20 47 47 39 24 22 34 57 74 12 26 68 28 35 2 56 48 53 37 6 6 98 1
Slide 29: US GAAP: Statement of Income
29 US GAAP: STATEMENT OF INCOME (US$m, except per share data or as noted) 30 Jun 21 31 Mar 21 30 Jun 20 Revenue Management fees 544.1 514.9 407.7 Performance fees 77.4 17.0 17.2 Shareowner servicing fees 64.0 60.8 47.3 Other revenue 52.9 51.3 45.8 Total revenue 738.4 644.0 518.0 Operating expenses E
Slide 30: Alternative Performance Measures
30 ALTERNATIVE PERFORMANCE MEASURES Note: Reconciliation to be used in conjunction with slide 31. Footnotes included on slide 32. Reconciliation of adjusted financial measures (US$m, except per share data) 30 Jun 21 31 Mar 21 30 Jun 20 Reconciliation of revenue to adjusted revenue Revenue 738.4 644.
Slide 31: Alternative Performance Measures (continued)
31 ALTERNATIVE PERFORMANCE MEASURES Reconciliation of adjusted financial measures (continued) (US$m, except per share data) 30 Jun 21 31 Mar 21 30 Jun 20 Reconciliation of net income attributable to JHG to adjusted net income attributable to JHG Net income attributable to JHG 137.3 155.5 102.9 Emplo
Slide 32: Footnotes to Reconciliation of Adjusted Financial Measures
32 ALTERNATIVE PERFORMANCE MEASURES Footnotes to reconciliation of adjusted financial measures 1 JHG contracts with third-party intermediaries to distribute and service certain of its investment products. Fees for distribution and servicing related activities are either provided for separately in an
Slide 33: Capital Management
33 CAPITAL MANAGEMENT Note: JHG purchases shares on market for the annual share grants associated with variable compensation, which is not included in the above share repurchases. Numbers may not cast due to rounding. 1 Total shares outstanding reflect amounts disclosed on Forms 10-Q or 10-K for eac
Slide 34: Performance Fees
34 PERFORMANCE FEES Note: Performance fees include prior quarter accrual true-ups. 1 AUM data present US mutual fund AUM subject to performance fees as at 30 June 2021. Janus Investment Funds and Janus Aspen Series Portfolios are counted as distinct and separate funds. Q2 2021 (US$m) Q1 2021 (US$m)
Slide 35: Performance Fees: Pay-out Timing
35 PERFORMANCE FEES 32.0 17.5 34.8 25.1 28.0 17.5 Q2 2021 Q3 2021 Q4 2021 Q1 2022 Q2 2022 Q3 2022 Segregated mandates SICAVs UK OEICs and unit trusts Investment trusts Offshore absolute return and other funds Quarterly payment Annual payment After UK OEIC and SICAV performance fees move(d) from quar
Slide 36: US Mutual Funds with Performance Fees
36 US MUTUAL FUNDS WITH PERFORMANCE FEES Note: Numbers may not cast due to rounding. 1 The funds listed have a performance-based investment advisory fee that adjusts up or down based on performance relative to a benchmark over 36-month rolling periods. Please see the funds’ Statements of Additional
Slide 37: Long-Term Incentive Compensation
37 LONG-TERM INCENTIVE COMPENSATION Note: Annual grants generally vest over three and four years. Assumed no forfeitures in future periods. Assumed no change in future values related to market or currency, which would impact expense related to cash-based awards (MFSAs, DIP and DEP funds) and social
Slide 38: Contacts
38 CONTACTS Investor enquiries Melanie Horton Co-Head Investor Relations (Non-US) +44 (0)20 7818 2905 melanie.horton@janushenderson.com Jim Kurtz Co-Head Investor Relations (US) +1 303 336 4529 jim.kurtz@janushenderson.com Investor Relations investor.relations@janushenderson.com Media enquiries Step
Slide 39: Contact Us / Forward Looking Information
201 Bishopsgate London EC2M 3AE United Kingdom www.janushenderson.com Contact us Past performance is no guarantee of future results. Investing involves risk, including the possible loss of principal and fluctuation of value. Forward looking information This presentation includes statements concernin
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