Slide 1: Investor & Analyst Briefing
Investor & Analyst l Briefing i fi Computershare Limited 16 March 2011
Slide 2: Welcome & Introduction
INVESTOR & ANALYST BRIEFING W l Welcome & Introduction I t d ti Stuart Crosby President & Chief Executive Officer 16 March 2011
Slide 3: Business Overview: Australia & New Zealand
INVESTOR & ANALYST BRIEFING Business B i Overview: O i Australia & New Zealand Mark Davis Head of Computershare, Australia & New Zealand 16 March 2011
Slide 4: Australia & New Zealand: Investor Services - Australia
Regional Overview: Australia & New Zealand Investor Services - Australia › State of play › Continue to lead market in Australia (60% ASX 50 / ASX 200) › Further market consolidation now unlikely › Acted d as registrar in respect off 94% off IPO capitall raised d YTD › Awarded Gold at the Australian
Slide 5: Australia & New Zealand: Investor Services - New Zealand
Regional Overview: Australia & New Zealand Investor Services - New Zealand › State of play › Market leadership continues with 74% of NZX 50 market share › Investment in technology has kept offering at forefront of market with further opportunities to leverage off new global capabilities › Challenges
Slide 6: Australia & New Zealand: Communication Services
Regional Overview: Australia & New Zealand Communication Services › State of play › A leading provider of specialised one to one communication solutions that integrate print, mail and electronic solutions › Significant investment has been made in new state of the art continuous colour digital printi
Slide 7: Australia & New Zealand: Plan Managers
Regional Overview: Australia & New Zealand Plan Managers › State of play › Remains clear market leader in Australia › Business has grown for 11th successive year › Global l b l footprint f and d capabilities bl key k to many large l client l successes › Challenges g & opportunities pp › New regulato
Slide 8: Australia & New Zealand: Proxy Solicitation
Regional Overview: Australia & New Zealand Proxy Solicitation › State of play › Ongoing market leader in Australia › Offering continues to be highly valued and engaged in most major Australian corporate actions requiring solicitation eg. eg Westfield, Westfield AMP AMP, Centennial Coal › Measured in
Slide 9: Australia & New Zealand: Fund Services
Regional Overview: Australia & New Zealand Fund Services › State of play › Specialist in unit trust and unlisted investment product registry administration › Competitors have historically been insourced solutions, custodians, registries with listed clients who have unlisted product requirements and
Slide 10: Question Time
INVESTOR & ANALYST BRIEFING Q Question ti Time Ti Mark Davis Head of Computershare, p , Australia & New Zealand 16 March 2011
Slide 11: Business Overview: Asia
INVESTOR & ANALYST BRIEFING B i Business Overview: O i Asia A i James Wong Head of Computershare p Asia 16 March 2011
Slide 12: Asia: Hong Kong
Regional Overview: Asia Hong Kong › State of play p y › Fund raising and corporate actions remain active but more subdued than previously › HK remains attractive for foreign companies to list › Listed Vale from f Brazil as ffirst HK Depository Receipt in Dec 2010 › Listed products and corporate acti
Slide 13: Asia: China
Regional Overview: Asia China › State of play p y › Relocation of Sydney based Plans personnel and local recruits reached critical mass › Continuing efforts on meeting services for domestic Chinese listed companies › Demand for shareholder analytics and proxy solicitation strong › Challenges & oppor
Slide 14: Asia: India
Regional Overview: Asia India › State of play p y › Changes in Mutual Funds regulations making fund products a less attractive cash investment alternative › New IPO IPO’ss emerging but both flow and application volume subdued with price competition keen › Challenges & opportunities › New IPO process
Slide 15: Asia: Japan
Regional Overview: Asia Japan › State of play p y › Decline in shareholder activism › Manifested as less demand for ID, fewer M&A, and price pressure on IR business in general › Working with Mitsubishi-UFJ to tap into other group entities for business › Challenges Ch ll & opportunities i i › New Tok
Slide 16: Question Time
INVESTOR & ANALYST BRIEFING Q Question ti Time Ti James Wong Head of Computershare p Asia 16 March 2011
Slide 17: Business Overview: United States of America
INVESTOR & ANALYST BRIEFING Business B i Overview: O i United States of America Steven Rothbloom Head of Computershare USA 16 March 2011
Slide 18: United States: Investor Services
Regional Overview: United States of America Investor Services › State of play › Client satisfaction very strong; significant increase in satisfaction scores on major industry survey › Won 50% of IPOs in last 6 months months, including General Motors › Escrow business expanding with 12 transactions i
Slide 19: United States: Corporate Proxy Solicitation & Funds Services
Regional Overview: United States of America Corporate Proxy Solicitation & Funds Services › State of play › Key corporate proxy wins: Coca Cola, Dr. Pepper Snapple, Prudential and Oracle; and solicitor for Duke Energy on merger with Progress Energy › Fund Services executing projects for Ameriprise (
Slide 20: United States: Plan Managers & Plans Software
Regional Overview: United States of America Plan Managers & Plans Software › State of play › Established private-label ESPP services for Bank of America/Merrill Lynch › Won Dow Chemical plans business, other clients in pipeline › Cl Closed d sale l off stockk option i plan l administration d i i i b
Slide 21: United States: Communication Services
Regional Overview: United States of America Communication Services › State of play › Strong momentum continues in non-core commercial activity, especially banking › Bank processor partnership resulted in 15 signed accounts in FY2011. Strong trailing pipeline of 20+ accounts developing › Winning new
Slide 22: United States: Bankruptcy and class action administration (KCC)
Regional Overview: United States of America Bankruptcy and class action administration (KCC) › State of play › 30% overall market share in 2010 versus 22.5% for Epiq › 38% of “mega” market share vs. 23% for Epiq › Market share up slightly versus 2009 › New bankruptcy clients include Blockbuster and
Slide 23: Question Time
INVESTOR & ANALYST BRIEFING Q Question ti Time Ti Steven Rothbloom Head of Computershare p USA 16 March 2011
Slide 24: Business Overview: Canada
INVESTOR & ANALYST BRIEFING B i Business Overview: O i Canada C d Wayne Newling Head of Computershare p Canada 16 March 2011
Slide 25: Canada: Investor Services
Regional Overview: Canada Investor Services › State of play › Continuing to win mandates › Kinross Gold $7 billion › Dundee Wealth Inc. $3.2 billion › Goldcorp $3.6 billion › Holding market share – over 62% as at December 31, 2010 › Challenges & opportunities › Canadian Stock Transfer have acquired
Slide 26: Canada: Corporate Trust
Regional Overview: Canada Corporate Trust › State of play p y › Debt activity has been increasing with new and existing issuances, we continue to hold a strong market position nationally › Debt under administration up p 11% year y on year, y , to over $1.486 $ trillion;; winning g most new business
Slide 27: Canada: Communication Services
Regional Overview: Canada Communication Services › State of play p y › Canadian IT infrastructure now in place and growing demand supports the short term cost impact › Stronger sales team now growing pipeline and beginning to deliver new deals › Strong service and SLA management is supporting organi
Slide 28: Canada: Plan Managers
Regional Overview: Canada Plan Managers › State of play p y › Transactional activity continues to be robust particularly amongst our larger clients › Business has strong economies of scale and a very low cost structure › Focus will be mainly on broad broad-based based contributory plans after sale o
Slide 29: Canada: Proxy
Regional Overview: Canada Proxy › State of play p y › Leading industry with 45% market share, measured by deals signed › Deal flow has increased by 21% compared to last year › 4 significant vendors in Canada now – and Issuers are seeking multiple bidders resulting in pricing pressures › Canadian Sec
Slide 30: Question Time
INVESTOR & ANALYST BRIEFING Q Question ti Time Ti Wayne Newling Head of Computershare p Canada 16 March 2011
Slide 31: Lunch
Investor & Analyst l Briefing i fi Computershare Limited L Lunch h 16 March 2011
Slide 32: Technology Overview: Global
INVESTOR & ANALYST BRIEFING T h l Technology Overview: O i Global Gl b l Stuart Irving Chief Information Officer 16 March 2011
Slide 33: Technology Overview: Global - Stuart Irving
Technology Overview: Global Stuart Irving › Biography › Appointed Chief Information Officer (CIO) of Computershare Limited in January 2008, responsible for all aspects of Computershare’s global information technology ((IT)) infrastructure and line-of-business application pp development, p , support
Slide 34: Technology Overview: Global IT Organisation
Technology Overview: Global IT Organisation Simple / Replicated / Global Alignment 34. Analyst Briefing of Computershare Limited.
Slide 35: Technology Overview: Global IT Organisation (2)
Technology Overview: Global IT Organisation (2) Carlos Leira Global CIO Stuart › Background in large scale project delivery Irving › Telecommunications industry › Focus on software development and business engagement Oceania UCIA & CE Americas Global Global CIO CIO CIO Development CTO Irvin Steltz G
Slide 36: Technology Overview: Global IT Organisation (3)
Technology Overview: Global IT Organisation (3) 36. Analyst Briefing of Computershare Limited.
Slide 37: Technology Overview: Global Expenditure
Technology Overview: Global Expenditure IT SPEND AS A % OF REVENUE IT SPEND PER EMPLOYEE 22,000³ 10.7 % 4 10.2% 10.3% 21,400 10 0% 10.0% 10 1% 10.1% 9.9% 9.9% $12,900 $12,500 5.9%¹ $11,400 5.2%² 5 2%² 1H’08 2H’08 1H ‘09 2H ‘09 1H’10 2H ‘10 1H’11 FY ‘08 FY ‘09 FY ’10 CTS is above industry sector benc
Slide 38: Technology Overview: Global Expenditure (2) – Capex
Technology Overview: Global Expenditure (2) – Capex INVESTMENT PROFILE – CTS 2010 CTS CAPEX BREAKDOWN 35% 30% 25% Capex, 20% 12% 15% 10% Opex, 88% 5% 0% Storage continues to require ongoing significant capital investment as the Computershare data increase outpaces the reduction in storage costs. The
Slide 39: Technology Overview: Global IT Strategy
Technology Overview: Global IT Strategy Business Priorities CTS Strategic Themes Targeted Outcomes 39. Analyst Briefing of Computershare Limited.
Slide 40: Technology Overview: Business Alignment Differentiation
Technology Overview: Business Alignment Differentiation Overview › Proven re-use of key technology and business assets › Low cost of entry into new markets › Economies of scale › Re-use arbitrage › Core registry systems › Channel platforms › Operations technologies › Enterprise systems › Our Competi
Slide 41: Technology Overview: Business Alignment Differentiation (2)
Technology Overview: Business Alignment Differentiation (2) Overview › No single business has a monopoly on innovation or investment g & › IT has a seat at the table for all Merger Acquisition activities – where we have a proven track record › Our key asset is our people and the combined culture sin
Slide 42: Technology Overview: Workforce Optimisation Permanent Staff
Technology Overview: Workforce Optimisation Permanent Staff CTS ATTRITION RATES¹ % INTERNAL STAFF BY INDUSTRY, 2010³ 95% Industry¹ 77% 84% 15% 74% 12.5% 64% 10% 7.5% 7 5% 5.0% CPU² 2.5 % 0 Q2’09 Q3’09 Q4’09 Q1’10 Q2’10 Q3‘10 Telco Utilities Finance IT CTS ‘10 CTS has a high level of retention of sta
Slide 43: Technology Overview: Strategy & Architecture Development
Technology Overview: Strategy & Architecture Development IC2 Employee Self Service Self-Service Investor Self-Service Self Service Imaging & Workflow Single View Web Content Scanning and Content Mgt of Investor Management Classification Issuer Self Document Middleware ESB Service Storage Single View
Slide 44: Technology Overview: Strategy & Architecture Development (2)
Technology Overview: Strategy & Architecture Development (2) Overview Diversification of Applications › Prioritisation is managed across the › Core Registry Systems business › Deposit Protection Scheme › We will invest to manageg market › Voucher Processing positioning, e.g. Intermediary Online now
Slide 45: Technology Overview: Strategy & Architecture Infrastructure
Technology Overview: Strategy & Architecture Infrastructure Overview › Three regional data centre nodes with a common footprint, SOE and a 100% virtualised internal cloud › Platform centralisation where possible, e.g. Financial Systems, Market Data Services etc. › Further consolidation is limited by
Slide 46: Technology Overview: Partnering & Innovation Innovation Agenda
Technology Overview: Partnering & Innovation Innovation Agenda Overview Market Segment › Our core businesses by definition requires we support; Gen Z g › Market segments from legal g age g to the oldest of ages & all walks of life Gen Y › Associated channels from paper to new Gen X emerging standard
Slide 47: Technology Overview: Research & Development Expenditure
Technology Overview: Partnering & Innovation Research & Development Expenditure Overview R&D IT Investment, 2008-10 › Computershare has invested hundreds of millions of dollars over time into 33.5M Technology research and development to 433,000 32.0M establish and innovate its core registry 28.6M bu
Slide 48: Technology Overview: Technology Sourcing
Technology Overview: Partnering & Innovation Technology Sourcing Overview › The sourcing model for our workforce is permanent staff to maximise IT’s knowledge of the business › IT services and software is a hybrid model, or right-sourcing, in that we will always look for opportunities To arbitrage c
Slide 49: Technology Overview: Security & Risk Management Risk Management
Technology Overview: Security & Risk Management Risk Management Overview › We are now operating in a changing world with a growing focus on risk and compliance › Computershare’s technology group has always been great at delivering to the Business within a less regulated f framework k › IT is now on
Slide 50: Technology Overview: Security & Risk Management Information Security
Technology Overview: Security & Risk Management Information Security Overview Data in Motion › Computershare has proactively invested in › DLP inspection of email traffic and files a number of key information security transfers initiatives that provide us with a y › Intrusion Detection System compet
Slide 51: Question Time
INVESTOR & ANALYST BRIEFING Q Question ti Time Ti Stuart Irving Chief Information Officer 16 March 2011
Slide 52: Business Overview: Continental Europe
INVESTOR & ANALYST BRIEFING Business B i Overview: O i Continental Europe Steffen Herfurth Head of Computershare Continental Europe 16 March 2011
Slide 53: Continental Europe: Investor Services - Sweden
REGIONAL OVERVIEW: CONTINENTAL EUROPE Investor Services - Sweden › State of play p y › Successfully retained our role as one of the market leaders of AGM services with 45% market share › Leading provider of proxy tabulation services for companies with their legal seat outside Sweden › Strong footpri
Slide 54: Continental Europe: Investor Services - Germany
REGIONAL OVERVIEW: CONTINENTAL EUROPE Investor Services - Germany › State of play p y › German market better than 2009, but still calm. Only 16 IPOs in 2010 – volume EUR2.7 billion. Majority of issuers still in bearer shares › CPU well positioned as registrar of choice for SME market › Market leader
Slide 55: Continental Europe: Investor Services - Russia
REGIONAL OVERVIEW: CONTINENTAL EUROPE Investor Services - Russia › State of play p y › Two registrars owned by CPU in Russia cumulatively have the largest market share › Successful growth of the client base › Integration g a o ofo processes po and a d functions u o well underway u d ay › Technologic
Slide 56: Continental Europe: Investor Services - Denmark
REGIONAL OVERVIEW: CONTINENTAL EUROPE Investor Services - Denmark › State of play p y › Core registration and AGM business performing as expected › Strong combined product suite › Won o 2 out ou of o 3 new listings g in 2010 0 0 › New Company act has been implemented which will drive further revenue
Slide 57: Continental Europe: Plan Managers - Denmark
REGIONAL OVERVIEW: CONTINENTAL EUROPE Plan Managers - Denmark › State of play p y › Currently market leader for LTIP schemes › (options, warrants, phantoms etc.) › Growth o in demand d a d foro LTIPs › Solution integrated into AGM and Registry system › IFRS 2 compliant solution › Flexible system tha
Slide 58: Continental Europe: Plan Managers - Germany
REGIONAL OVERVIEW: CONTINENTAL EUROPE Plan Managers - Germany › State of play p y › Fragmented market dominated by 3 banks offering end to end solutions › CPU small player locally looking after existing client base › Still no o approved app o d tax a schemes like those o in the UK U › VEM and CPU De
Slide 59: Continental Europe: Communication Services - Germany
REGIONAL OVERVIEW: CONTINENTAL EUROPE Communication Services - Germany › State of play p y › CCS regaining traction after a period of challenges in 2009 and 1H 2010 (local consequences of GFC, shaken industry) › Maintaining existing client base, all contracts extended, 1 lost due to M&A › 5 renowned
Slide 60: Continental Europe: VEM
REGIONAL OVERVIEW: CONTINENTAL EUROPE VEM › State of play › Strong rebound of German economy and blue chip share index (DAX) after financial crisis › Still worries concerning write-offs by banks, higher capital requirements and Euro- Z Zone b bail-out il t risks i k › Although SME market still weak
Slide 61: Question Time
INVESTOR & ANALYST BRIEFING Q Question ti Time Ti Steffen Herfurth Head of Computershare p Continental Europe p 16 March 2011
Slide 62: Business Overview: UK, Channel Islands, Ireland & Africa (UCIA)
INVESTOR & ANALYST BRIEFING Business B i Overview: O i United U it d Kingdom, Ki d Channel Islands, Ireland & Africa (UCIA) Naz Sarkar Head of UCIA 16 March 2011
Slide 63: UCIA: Registry UK
Regional Overview: UCIA Registry UK › State of play p y › No. 1 again in Capital Analytics Survey 2010/11 – 3 years in a row! › High client retention rates as major clients renew without tender › Largest share of IPOs for the first time › Continuing to maintain market share in Depositary Interests ›
Slide 64: UCIA: Registry UK – The Competition
Regional Overview: UCIA Registry UK – The Competition › Equiniti q › Remains 3rd out of 3 in Capital Analytics Survey 2010/11 › A number of successful switch wins from Equiniti including: › Aviva › Informa › Henderson Far East › Henderson Diversified › Capita › Credible competitor p but making g som
Slide 65: UCIA: Ireland
Regional Overview: UCIA Ireland › State of play p y › Market leader with 70% of Irish Market › Ongoing success with ETF Market now over 200 funds › Irish Banks Capital Raising still ongoing › Challenges Ch ll & opportunities t iti › Improved regional and global ETF offer › Regional hub for re re-dom
Slide 66: UCIA: Business Services
Regional Overview: UCIA Business Services › State of play p y › Deposit Protection Service (DPS) contract extended to 2016 › DPS continues to increase market share through excellent service delivery and low interest rate environment › Structured Products (SP) business line shows continued growth and
Slide 67: UCIA: Computershare Voucher Services
Regional Overview: UCIA Computershare Voucher Services › State of play p y › Childcare Vouchers survived the UK Government Comprehensive Spending Review › Service levels are high-quality in a demanding and emotive market › CVS continues to be the market leader › New management team focused on cost m
Slide 68: UCIA: Communication Services
Regional Overview: UCIA Communication Services › State of play p y › Quality of output remains strong › Cost base remains very well controlled › Internal business opportunities converted; Plans migrations migrations, Proxy Mailings, Corporate Action fulfilment › High value external client contracts
Slide 69: UCIA: South Africa
Regional Overview: UCIA South Africa › State of play p y › M & A and general corporate activity is down › Pan-African opportunity real but progress is slow › Continue to enjoy very high registry market share and relationships and service delivery remains very strong › Ch ll Challenges & opportunitie
Slide 70: UCIA: Georgeson - Corporate Proxy Solicitation
Regional Overview: UCIA Georgeson - Corporate Proxy Solicitation › State of play p y › Register analysis service is up and running with 6 new clients since Nov ‘10 launch and another 4 prospects › M&A market picking up › Shareholder activism is already showing strong growth in H2 › Office in the Net
Slide 71: UCIA: Channel Islands
Regional Overview: UCIA Channel Islands › State of play p y › 13 months ago purchased two Employee Benefit Trust businesses from Lloyds Bank Group and bought out our joint venture business › All businesses have been integrated into one location and are run as one business › Taking advantage of our l
Slide 72: UCIA: Plan Managers
Regional Overview: UCIA Plan Managers › State of play p y › Dealing revenues continue to be strong › Focus is on existing book › Cross Cross-sell sell remains strong › Costs remain under control › Challenges & opportunities › Integration of acquired business › Clear capability gap emerging in market
Slide 73: UCIA: HBOS EES Integration Overview
Regional Overview: UCIA HBOS EES Integration Overview › State of play p y › 13 months into integration of HBOS EES › Completed 10 out of 12 tranches of client migrations in Halifax › Started work on Purley migrations › Have reduced staff and technology costs faster than expected › Whilst a complex a
Slide 74: Question Time
INVESTOR & ANALYST BRIEFING Q Question ti Time Ti Naz Sarkar Head of UCIA 16 March 2011
Slide 75: Investor & Analyst Briefing: Close
Investor & Analyst l Briefing i fi Computershare Limited Close Cl 16 March 2011