BKI Investment Co. Ltd. · ASX:BKI
BKI Investment — FY2020 Earnings Presentation
24 slides from BKI Investment's earnings presentation, Jul 17, 2020
Slide 1: Results for the full year ended 30 June 2020
For personal use only BKI INVESTMENT COMPANY LIMITED Results for the full year ended 30 June 2020 BKI is managed by Contact Asset Management AFSL 494045
Slide 2: Disclaimer
Disclaimer For personal use only This material has been prepared by Contact Asset Management on behalf of BKI Investment Company Limited. The information within this document is not intended to provide advice to investors or take into account an individual’s financial circumstances or investment obj
Slide 3: Highlights
Highlights For personal use only For the full year ended 30 June 2020 Result excluding special investment revenue 2020 2019 Movement Investment revenue – ordinary $45.4m $52.3m ‐13% Revenue from operating activities $46.7m $54.3m ‐14% Net operating profit after tax $41.6m $49.2m ‐15% Earnings per sh
Slide 4: Dividends Received: Cuts, Deferrals and Cancellations
Dividends Received For personal use only Cuts, Deferrals and Cancellations Dividend Cuts Special Dividends Dividend Cancellations Source: BKI, Contact Asset Management, Factset. BKI Investment Company Limited 4
Slide 5: Final Dividends and Key Dates
Final Dividends and Key Dates For personal use only BKI is paying a fully franked final ordinary dividend of 2.32cps. BKI will also pay a 1.00cps fully franked special dividend. Last trading date to be eligible for the BKI FY2020 final dividends is Thursday 6 August 2020. Key Dates Last trading date
Slide 6: Dividend History
Dividend History For personal use only BKI’s fully franked dividend yield is currently 4.3%*, while the grossed up yield is 6.3%* 5.00 4.00 3.00 2.00 1.00 0.00 Ordinary Dividends per Share Special Dividends per Share BKI has paid out $1.09 per share, or over $700m in dividends and franking credits t
Slide 7: Income Generation
Income Generation For personal use only Long term dividend income Income from BKI Dividends $2,500 $2,374 An investment of $10,000 to purchase BKI $2,000 shares upon listing in December 2003 would now be receiving fully franked dividends of $1,662pa. $1,500 The franking credits enhance the income by
Slide 8: Performance
For personal use only Performance For the full year ended 30 June 2020 BKI is managed by Contact Asset Management AFSL 494045
Slide 9: Total Shareholder Returns
Total Shareholder Returns For personal use only As at 30 June 2020 BKI’s One Year Total Shareholder Return, including franking credits, was negative 5.0%. BKI’s Net Portfolio Return (after all operating expenses, provision and payment of both income and capital gains tax and the reinvestment of divi
Slide 10: Positioning BKI for the Future
For personal use only Positioning BKI for the Future Actively managed portfolio for an attractive fee BKI is managed by Contact Asset Management AFSL 494045
Slide 11: Investment Process
Investment Process For personal use only Research driven, active management Through a research driven, active management approach BKI invests for the long term in profitable, well managed companies that offer a compelling yield and growth opportunities. Principal Activity We invest using the five fu
Slide 12: Portfolio Positioning
Portfolio Positioning For personal use only For the full year ended 30 June 2020 Top 10 Investment Increases Investments Sold Investments Reduced Source: BKI, Contact Asset Management. BKI Investment Company Limited 12
Slide 13: Major Overweight/Underweight by Stock
Major Overweight/Underweight by Stock For personal use only As at 30 June 2020 Overweight Positions Underweight Positions Company Active Weight Company Active Weight APA Group 5.0% CSL Limited (8.0%) Macquarie Group 5.0% ANZ Banking Group (3.2%) TPG Telecom 4.1% Rio Tinto (2.2%) Transurban Group 2.7
Slide 14: Top Investments
Top 25 Investments For personal use only As at 30 June 2020 Stock % of Total Portfolio Stock % of Total Portfolio 1 Macquarie Group 7.2% 14 Telstra Corporation 2.5% 2 Commonwealth Bank 6.6% 15 Woodside Petroleum 2.3% 3 BHP Limited 6.4% 16 New Hope Corporation 2.3% 4 APA Group 5.9% 17 Westpac Banking
Slide 15: Insights from the Investment Manager: The Market
For personal use only Insights from the Investment Manager The Market BKI is managed by Contact Asset Management AFSL 494045
Slide 16: Cautious on Market Valuations
Cautious on Market Valuations For personal use only Average price to earnings multiple of 15.3x since 2008 Despite the global economic issues seen over the last six months, the forecast One Year S&P/ASX300 PE multiple has increased from 18.9x in December 2019 to 20.3x in June 2020. 20X PE 20.3x 15X
Slide 17: Even More Cautious of Forward EPS Forecasts
Even More Cautious of Forward EPS Forecasts For personal use only Very rarely does the market get it right! Australian Market EPS Growth Profile Source: Contact Asset Management, Macquarie Research, Bloomberg, Factset 17 17 BKI Investment Company Limited 17
Slide 18: Australia's Economic Stimulus Packages
Australia’s Economic Stimulus Packages For personal use only Our Government and Banks to the rescue! Economic Response to the Coronavirus “The Government’s economic support package totals almost $260 billion. Direct fiscal measures are equivalent to around 6.9% of GDP” treasury.gov.au/coronavirus So
Slide 19: Insights from the Investment Manager: Key Long-Term Themes
For personal use only Insights from the Investment Manager Key Long‐Term Themes BKI is managed by Contact Asset Management AFSL 494045
Slide 20: Australia's Equity Yield is Attractive
Australia’s Equity Yield is Attractive For personal use only We expect to see a substantial flight of global capital to Australia Dividend Yield Global Comparison (excluding Franking) Source: Contact Asset Management, Factset, Eaton Vance July 2020. BKI Investment Company Limited 20
Slide 21: Australia's Funds Growth
Australia’s Funds Growth For personal use only The growth in superannuation assets in Australia is going to be substantial Australian Superannuation System Forecasts ($bn) $7.2 8,000 ‐‐‐‐‐‐‐‐‐ trillion 6,000 ‐‐‐‐‐‐‐‐‐ 4,000 ‐‐‐‐‐‐‐‐‐ $2.6 trillion 2,000 ‐‐‐‐‐‐‐‐‐ 0 ‐‐‐‐‐‐‐‐‐ Source: Contact Asset Ma
Slide 22: Major Transport Infrastructure Projects - Australia
Major Transport Infrastructure Projects ‐ Australia For personal use only Infrastructure spend is currently at levels never seen before and will continue for many years Governments are now bringing forward further major building projects to boost the economy $23 billion $3 billion Source: Macromonit
Slide 23: BKI Overview: Benefits of investing in BKI
For personal use only BKI Overview Benefits of investing in BKI BKI is managed by Contact Asset Management AFSL 494045
Slide 24: Benefits of Investing in BKI
Benefits of Investing in BKI For personal use only Income Focused Low Fee Structure Alignment Reliable, fully franked income Managed for 0.10%, BKI Directors and Portfolio Managers stream. Multiple Special Dividends no performance fee. are shareholders, creating strong returned to shareholders. alig
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