SS&C Technologies Holdings, Inc. · NASDAQ:SSNC
SS&C Technologies — Q2 2021 Earnings Presentation
46 slides from SS&C Technologies's earnings presentation, Jul 29, 2021
Slide 1: UK Funds Distribution: Q2 2021 Trends and how to respond
UK Funds Distribution Q2 2021 Trends and how to respond 29th July 2021
Slide 2: Welcome
Welcome Charles Berry Jerry Scott Senior Director Global Data Management 2
Slide 3: Agenda
Agenda • Market Insights o Q2 Updates o Property Sector o Fund of Funds o ESG • Putting these insights into action – Opportunity Insights • Managing your Data – SalesConnect • Q&A, and Survey 3
Slide 4: SS&C UK Distribution Landscape
SS&C UK Distribution Landscape • The SS&C market view focuses on ‘Platforms’ totalling half the market Percentage of Annual Gross Sales • Of Platforms, largest five steady 50% of gross sales between them • In latest quarter, Hargreaves Lansdown had highest value of inflow, and net sales growth of 3%
Slide 5: Post tax year end drop in Gross and Net Sales
Post tax year end drop in Gross and Net Sales % increase on prior month (Jan ‘20 to Jun ‘21) Vaccine COVID-19 Announcement Correction COVID-19 Drop Source: Morningstar Data & SS&C UK TA Data: UK All Channel Data between January 2020 and June 2021 (excluding FoF’s) © 2021. SS&C Technologies. Confiden
Slide 6: Q2 Updates
Q2 Updates
Slide 7: Q2 Updates - Summary
Q2 Updates - Summary • Performance in all IMA sectors was positive for Q2 • Passive Funds have outperformed Actives on Net Sales Growth for Q2; • Across All Channels, Active to Passive trend continues with Active net sales down -1.7% and Passive up 3.8%. • Via platforms, Active Net Sales flat, but +
Slide 8: Passive Funds strong performance in Q2
Passive Funds strong performance in Q2 Q2 % changes (total all Channels) 12.0% 10.0% Totals for All Channels: 10.0% Net Sales: Passives 3.8% vs Actives -1.7% Underlying Performance: Passives ahead of 8.0% Actives 6.1% vs 4.9%. 6.1% 6.0% 4.9% 3.8% 4.0% 3.2% 2.0% 0.0% -2.0% -1.7% -4.0% Active Passive
Slide 9: Equity Funds on Platforms – Actives outperform
Equity Funds on Platforms – Actives outperform Q2 % changes – on Platforms & Equity Funds only 9.0% 8.5% 8.0% 7.2% Focussing on just Equity: 6.9% 7.0% Passives are seeing flow with 2.5% Net Sales 6.0% 6.0% Growth vs 0.3% on Actives. Underlying Performance, shows Actives ahead 5.0% of Passives 6.9% v
Slide 10: Equity Funds continue move to Passive
Equity Funds continue move to Passive Source: Morningstar Data & SS&C UK TA Data: UK Platform Net Sales Growth between July 2020 and June 2021 (excluding FoF’s) – Equity Only © 2021. SS&C Technologies. Confidential 10
Slide 11: Active and Passive funds show similar performance
Active and Passive funds show similar performance Cumulative Underlying Performance Active Funds vs Passive Funds 140 130 120 110 100 90 80 2017 Q1 2017 Q2 2017 Q3 2017 Q4 2018 Q1 2018 Q2 2018 Q3 2018 Q4 2019 Q1 2019 Q2 2019 Q3 2019 Q4 2020 Q1 2020 Q2 2020 Q3 2020 Q4 2021 Q1 2021 Q2 Source: Mornings
Slide 12: 18% quarter outflow from UK property funds
18% quarter outflow from UK property funds UK Sectors reversing LTM Trend in Q2 Source: Morningstar Data & SS&C UK TA Data: UK Platform Data between April and June 2021 (excluding FoF’s) – Top 20 Sectors by June 2021 AUM © 2021. SS&C Technologies. Confidential 12
Slide 13: UK All Companies, a sector of two halves…
UK All Companies, a sector of two halves… Q2 Net Sales by Sector split Active/Passive funds Source: Morningstar Data & SS&C UK TA Data: UK Platform Data between April and June 2021 (excluding FoF’s) – Top 20 Sectors by June 2021 AUM © 2021. SS&C Technologies. Confidential 13
Slide 14: Property Sector
Property Sector
Slide 15: UK Direct Property Sector Summary
UK Direct Property Sector Summary • Assets on Platforms have halved over last three years whilst holdings by Corporates is down to a third of what it was over the same period • Fund suspensions delayed otherwise steady outflow from funds • Although this most recent quarter shows a positive performan
Slide 16: UK Direct Property Funds - Declining AUM
UK Direct Property Funds - Declining AUM AUM Indexed Platform AUM grew during 2017 and 2018 but declined significantly thereafter and is down over 50%. Corporate AUM has seen virtually no growth across the same period and has declined by more than 60%. Source: Morningstar Data & SS&C UK TA Data: UK
Slide 17: Property Funds outflows, but Q2 uptick
Property Funds outflows, but Q2 uptick Quarterly % change Property Funds, Platforms Gross sales had been in steady decline prior to fund suspensions but are surprisingly strong at 3.3% in the latest quarter. However it is not enough to mask the huge outflows. Source: Morningstar Data & SS&C UK TA Da
Slide 18: Q2 Return to Positive Underlying Performance
Q2 Return to Positive Underlying Performance And Underlying Performance returns to positive number as COVID restrictions ease. Source: Morningstar Data & SS&C UK TA Data: UK Platform Sales (excluding FoF’s) © 2021. SS&C Technologies. Confidential 18
Slide 19: Property fund exits mostly May, but not always
Property fund exits mostly May, but not always Hargreaves Lansdown, a good proxy for D2C channel, saw much less outflow in UK Direct Property sector. Source: Morningstar Data & SS&C UK TA Data: UK Platform Sales (Top 10 Platforms by AUM, excluding FoF’s) – UK Direct Property Sector © 2021. SS&C Tech
Slide 20: Fund of Funds
Fund of Funds
Slide 21: Fund of Funds Summary
Fund of Funds Summary • A fund that invests in other funds identified through flag in Morningstar data. • 24% of Platform AUM resides in FoF vs just 5% of Corporate AUM – expected as FoF suited to small investors looking for simplicity & low risk/low cost. • Strong correlation between FoF Sales and
Slide 22: Net Sales showing Passive overtaking FoFs
Net Sales showing Passive overtaking FoFs Net Sales Quarterly Change By Fund Type Q1 ‘17 to Q2 ‘21 Net Sales Growth FoF Net Sales Growth has remained positive over the same period, although the trend is downwards. Source: Morningstar Data & SS&C UK TA Data: UK Platform Sales © 2021. SS&C Technologie
Slide 23: Distinctive characteristics for each fund type
Distinctive characteristics for each fund type Sales Weighted Average Metrics by Fund Type Sustainability Environment Governance Carbon Risk Sharpe 3yr Return1yr Return3yr Return5yr Expense Rating Social Fund Type • Absolute returns Active 4.0 0.8 23.4 11.1 13.1 0.5 21.9 3.9 8.7 6.8 6.8 and ESG Fund
Slide 24: FoFs Gross Sales tend towards Lower Expense
FoFs Gross Sales tend towards Lower Expense Gross Sales (12 Months) Logarithmic Scale Expense Source: Morningstar Data & SS&C UK TA Data: UK Platform Data Last Twelve Months (Excluding Passives) © 2021. SS&C Technologies. Confidential 24
Slide 25: FoFs Gross Sales go with Lower Expense
FoFs Gross Sales go with Lower Expense Gross Sales (12 Months) Logarithmic Scale Expense Source: Morningstar Data & SS&C UK TA Data: UK Platform Data Last Twelve Months © 2021. SS&C Technologies. Confidential 25
Slide 26: ESG
ESG
Slide 27: Platform average ESG scores – what to beat?
Platform average ESG scores – what to beat? Sales Weighted Average ESG Metrics - All Sectors Sustainability Elements Carbon IA Sector Sustainability Environmental Social Governance Risk Overall 21.8 3.8 8.5 6.7 7.2 Sales Weighted Average ESG Metrics – Selected Sectors Sustainability Elements Carbon
Slide 28: Best & Worst Sectors for Environment Score
Best & Worst Sectors for Environment Score IA Sector Environment Global Mixed Bond 1.6 Environment Score European Smaller Companies 2.1 Environment Score is one the three pillars of Technology and Telecommunications 2.4 Morningstar's Portfolio Sustainability Score which is a measure of financially m
Slide 29: Better Environment Score linked to more Sales
Better Environment Score linked to more Sales North America funds beat UK All Companies on Environment Score with a sales weighted average advantage of 0.8 Gross Sales (3 Months) Environment Score Source: Morningstar Data & SS&C UK TA Data: UK Platform Data between April and June 2021 (excluding FoF
Slide 30: Putting these insights into action: Opportunity Insights
Putting these insights into action Opportunity Insights
Slide 31: Opportunity Insights – Insights to take action on
Opportunity Insights – Insights to take action on Apply Client Lens Tailored Actionable Insights Sector Trends Channel trends ManCo. rankings Sector rankings Morningstar Fund rankings data ManCo. vs. Market Advisor Sales & Top Greenspace Who do I contact AUM data with what message? Defence scenarios
Slide 32: We help identify your low hanging fruit
We help identify your low hanging fruit Current view of opportunity: 6 Competitive Sales with unknown 5 Competitive Sales (£B) advantage 4 3 5.5 4.6 2 3.4 3.1 1.9 1 £18.5B - UK All Global £ Stratgeic North America UK Equity Companies Bond Income © 2021. SS&C Technologies. Confidential
Slide 33: SS&C Green Space Opportunity
We help identify your low hanging fruit SS&C “Green Space” Opportunity 6 17% Competitive sales where you have 5 47% Competitive Sales (£B) distinct product advantages* 4 45% 4% 2.4 4.6 3 5.5 22% • 3yr performance 2 4.6 1.7 3.4 3.1 3.2 • Morningstar rating 1 2.2 1.5 1.9 1.4 0.9 £5.1B 0.4 0.2 - Global
Slide 34: Find your best opportunity and best metrics
Find your best opportunity and best metrics Share Class IA Sector Metric 1 Metric 2 GS Opportunity • SS&C calculates Greenspace, the sum of competitor platform Return 1yr Sustainability 88% sales in which a fund has a competitive advantage. Sustainability Social 76% ISIN A Global Return 1yr Social 7
Slide 35: Client successes
Client successes Pursuing a non-”focus fund” in the Greenspace delivered 10 x market share growth in one year 10 X market share growth © 2021. SS&C Technologies. Confidential 35
Slide 36: What are my strengths in the top sectors?
What are my strengths in the top sectors? Easily understand your fund strengths vs competing products purchased by sector Green Space 1 Year 3 Year Sustain- Client’s Top Funds M* Rating Expense % Carbon Risk Opportunity Return % Return % ability Global – Fund B £2.2B 4 0.8 1.5 2.4 21.6 5.1 North Ame
Slide 37: Know who to contact and why
Know who to contact and why Prioritised contact lists by territory to support Sales conversations Model view Sales Rep view Advisor Firm view Advisor Firm Green Space Contact Territory Advisory Firm Fund to Promote Model Opp Rank AUM Details South East Smart Money IFA AC Global Equity £31m Grow (Sub
Slide 38: Client successes
Client successes A client’s AUM increased across firms contacted using the SS&C model vs. no model AUM growth improvement +67% +52% +28% No model Defend Grow Acquire SS&C models © 2021. SS&C Technologies. Confidential 38
Slide 39: Managing your Data: SalesConnect
Managing your Data SalesConnect
Slide 40: SalesConnect Trade/Asset Matching
SalesConnect Trade/Asset Matching UK & European Platform files TA DATA ACQUISITION PLATFORM DATA ACQUISITION SALESCONNECT CLEANSE ENRICH DATA ENRICHMENT Data Files Web Application Reporting Opportunity Database Insights DATA DELIVERY 40 © 2021. SS&C Technologies. Confidential
Slide 41: Data Files
Data Files Trades & Positions Client Maintenance • Event Based • Types • Frequency: Upon receipt • Firms • Layout: Core and pass-around records • Offices • Update Based • Contacts • Frequency: Daily • Partnerships • Layout: Core records • Frequency • Delta (daily) • Full (periodic) 41
Slide 42: Rep Profile
Rep Profile eel SalesConnect Welcome, Jerry Scott Connections Mr. Robert James Waterfall & Office Physical Address Address Locked Mailing Address Contact ID Office ID Firm ID Oculus Wealth Management (North Dorset) Oculus Wealth Management (North Dorset) Sunnyside Peachmarsh GillinghamSP8 4HD United
Slide 43: Integrated Services
Integrated Services Profile Management Trade Matching Robert James Waterfall Robert James Waterfall Oculus Wealth Management (North Dorset) AUM: $2,500,000 Sunnyside Prod A: $2,000,000 Peachmarsh Prod B: $500,000 Gillingham SP8 4HD UK YTD Sales: $750,000 0743 476 9076 YTD Reds: $50,000 rwaterfall@oc
Slide 44: Benefits of Adding SalesConnect
Benefits of Adding SalesConnect Data Quality • Data managed with high quality standards and processes Data • Consistent processing & layouts for easier global Consistency reporting Best • Collaborate with peers from other global managers Practices on industry challenges Trends & Opportunity • Quarte
Slide 45: How to join – Trial SalesConnect now
How to join – Trial SalesConnect now RAPID DEPLOYMENT FRAMEWORK > > > Scope POC Approve Go - Live Get started: • Permission access to key Platform files • Provide named stakeholders 45 © 2021. SS&C Technologies. Confidential
Slide 46: Questions
Questions
SS&C Technologies Holdings — Q2 2021 Earnings Presentation on 6ix