WAM Active Ltd. · ASX:WAA
WAM Active — Investor Presentation (November 2015)
45 slides from WAM Active's investor presentation, Nov 24, 2015
Slide 1: Investor Presentation November/December 2015
For personal use only Investor Presentation November/December 2015
Slide 2: Disclaimer
For personal use only Disclaimer This presentation has been prepared for use in conjunction with a verbal presentation and should be read in that context. Information for the graphs, charts and quoted indices contained in this presentation has been sourced from Mintel, IRESS Market Technology, Wilso
Slide 3: Agenda
Agenda For personal use only 1 About Wilson Asset Management 2 Market overview and outlook 3 Investment themes and trends 4 Investment portfolio 5 Performance: • WAM Capital Limited • WAM Research Limited • WAM Active Limited 6 Making a difference 7 Investor communication 3
Slide 4: About Wilson Asset Management
For personal use only About Wilson Asset Management
Slide 5: About Wilson Asset Management
About Wilson Asset Management For personal use only • Our team is passionate about making a difference • We are innovative, agile and entrepreneurial. Our investment approach and results are proven • We invest our time and expertise in causes that resonate with us • We value shareholder engagement,
Slide 6: Experienced team
Experienced team For personal use only Geoff Wilson Matthew Haupt B Sc GMQ FAICD FFinsia CFA B Com Grad Dip App Fin Chairman / Portfolio Manager Portfolio Manager Kate Thorley Martin Hickson B Com CPA Grad Dip ACG B Bus B Comp Chief Executive Officer Senior Equity Analyst / Dealer / Company Secretar
Slide 7: Our listed investment companies
Our listed investment companies For personal use only WAM Capital WAM Research WAM Active (ASX: WAM) (ASX: WAX) (ASX: WAA) Gross assets $870m $210m $36m Share price* $2.02 $1.25 $1.03 Pre tax NTA $1.87 $1.17 $1.01 Premium to NTA* 8.0% 6.8% 2.0% Fully franked FY2015 6.9% 6.4% 2.4% dividend yield* Res
Slide 8: How we invest
How we invest For personal use only Research and market driven Research driven Market driven • Extensive company research (meeting • Scour the market for opportunities 1,000+ companies per year) focused on • Allows sound return with a low forecasting free cashflows and rating correlation to traditio
Slide 9: Research driven investment process
Research driven investment process For personal use only Investment universe 2,000+ Investment ideas Preparation and company meetings (1,000+ p.a.) Analysis: qualitative and quantitative Stock rankings Catalyst identified PORTFOLIO 20-60 stocks selected 9
Slide 10: Detailed rating process
Detailed rating process For personal use only This process has delivered strong outperformance in both rising and falling markets for almost two decades • Qualitative analysis - Rate management - Rate industry/position • Quantitative analysis - Forecast two year earnings per share (EPS) growth - Val
Slide 11: WAM Leaders
WAM Leaders For personal use only Our disciplined investment We have traditionally rating process is applied to invested c. 10% in Australian all listed equities large cap companies We are now looking to establish another listed We look forward to investment company sharing more with you soon focuse
Slide 12: Market overview and outlook
For personal use only Market overview and outlook
Slide 13: Market overview and outlook
Market overview and outlook For personal use only Have resources stocks bottomed? Below trend Housing has economic peaked this growth cycle Further interest rate cuts? 13
Slide 14: The state of the States
The state of the States For personal use only 14
Slide 15: Investment themes and trends
For personal use only Investment themes and trends
Slide 16: Taxi industry under threat
Taxi industry under threat For personal use only • Smartphone app-based ride sharing company, Uber, started in 2009 and is one of the fastest- growing businesses in the world • The company connects passengers and drivers who use their own private vehicles to provide cheap and clean taxi-like transpo
Slide 17: Australia's fitness obsession
Australia’s fitness obsession For personal use only • For many Australians ‘activewear’ has replaced casual wear given an increasing focus on health and fitness Lorna Jane activewear • Australian activewear pioneer growing at Lorna Jane’s revenue is approaching $200m growing at more than 30% 30% • T
Slide 18: Women having babies later in life
Women having babies later in life For personal use only • Women are increasingly choosing to have children later in life and demand for assisted reproductive services has grown • Virtus Health (ASX: VRT) and Monash IVF (ASX: MVF) dominate the Australian market performing the majority of IVF cycles a
Slide 19: Western Sydney's surge
Western Sydney’s surge For personal use only • Western Sydney is the largest long- • Massive infrastructure spending is term growth corridor in Australia, both planned and underway, including with enormous potential and minimal Badgerys Creek Airport with the existing infrastructure government worki
Slide 20: Growing Chinese consumption
Growing Chinese consumption For personal use only • Australia’s exposure to China’s compelling growth story has continued through the end of the mining boom and into the free trade agreement • Market research firm Mintel found 80% of urban Chinese consumers believe organic food is worth the addition
Slide 21: Investment portfolio
For personal use only Investment portfolio
Slide 22: Top holdings
Top holdings For personal use only ASX Code Company HHV Hunter Hall Global Value Limited* ECX Eclipx Group Limited^ CYA Century Australia Investments Limited* ASB Austal Limited^ SIQ Smartgroup Corporation Limited^ NUF Nufarm Limited* IPH IPH Limited^ AOG Aveo Group* AAD Ardent Leisure Group^ ^ Rese
Slide 23: What we like – research driven
What we like – research driven For personal use only Eclipx Group (ASX: ECX) Profile • Established player in vehicle fleet leasing, fleet management and diversified financial services Background • Market cap $770m • Forward PE of 14x • EPS growth of 20% • $1.7b and 80,000 vehicles assets under manag
Slide 24: What we like – market driven
What we like – market driven For personal use only Nufarm (ASX: NUF) Profile • Global crop protection and seed technology company Background • Market cap $2.2b • PE of 17.5x , EPS growth of 19% • New management team recently joined the business, undertaking a large cost-out program Catalysts • New m
Slide 25: What has worked – research driven
What has worked – research driven For personal use only The Reject Shop (ASX: TRS) Profile • One of Australia’s largest discount variety retailers Background • Market cap $320m • PE of 18x • EPS growth of 32% • 333 stores around Australia servicing price conscious consumers Catalysts • Success of th
Slide 26: What has worked – market driven
What has worked – market driven For personal use only Qantas Airways (ASX: QAN) Profile • Airline with multiple brands including Qantas, Jetstar, Qantas Link, Qantas Freight Background • Market cap $7.5b • In FY14 the company reported a $2.8b loss, due to high operating costs, a poor operating envir
Slide 27: What didn't work – research driven
What didn’t work – research driven For personal use only Retail Food Group Limited (ASX: RFG) Profile • Owner of portfolio of franchise brands and coffee roasting business Background • Market Cap $740m • FY16 PE of 11x • EPS growth 15% Catalysts • Acquisition led growth path • Diversification into c
Slide 28: Performance
For personal use only Performance
Slide 29: WAM Capital outperformance
WAM Capital outperformance For personal use only Performance at Since 1 Yr 3 Yrs 5 Yrs 10 Yrs Inception 31 October 2015 (% pa) (Aug 1999) WAM Investment Portfolio* 19.4% 19.0% 15.4% 13.9% 18.0% S&P/ASX All Ordinaries 0.4% 9.9% 6.8% 6.3% 8.0% Accumulation Index Outperformance +19.0% +9.1% +8.6% +7.6%
Slide 30: WAM Capital dividend growth
WAM Capital dividend growth For personal use only WAM Capital dividends since inception Cents per share 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 Ordinary fully franked dividend Special fully franked dividend Equal access share buy-back The Board is committed to paying an increasing stream of ful
Slide 31: WAM Research outperformance
WAM Research outperformance For personal use only Since Performance at change in 1 Yr 3 Yrs 5 Yrs investment 31 October 2015 (% pa) strategy (July 2010) WAX Investment Portfolio* 24.4% 24.4% 19.4% 19.9% S&P/ASX All Ordinaries 0.4% 9.9% 6.8% 8.4% Accumulation Index Outperformance +24.0% +14.5% +12.6%
Slide 32: WAM Research dividend growth
WAM Research dividend growth For personal use only WAM Research dividends since inception Cents per share 9.0 8.0 7.0 6.0 5.0 4.0 3.0 2.0 1.0 0.0 Ordinary fully franked dividend Special fully franked dividend The Board is committed to paying an increasing stream of fully franked dividends to shareho
Slide 33: WAM Active outperformance
WAM Active outperformance For personal use only Performance at Since 1 Yr 3 Yrs 5 Yrs Inception 31 October 2015 (% pa) (Jan 08) WAA Investment Portfolio* 13.3% 13.6% 11.7% 12.6% S&P/ASX All Ordinaries 0.4% 9.9% 6.8% 1.9% Accumulation Index Outperformance +12.9% +3.7% +4.9% +10.7% UBS Bank Bill Index
Slide 34: WAM Active dividend growth
WAM Active dividend growth For personal use only WAM Active dividends since inception Cents per share 12.0 10.0 8.0 6.0 4.0 2.0 0.0 2008/09 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 Return of Capital Fully franked dividends The Board is committed to paying an increasing stream of fully franked
Slide 35: Making a difference
For personal use only Making a difference
Slide 36: Changes to franking put to rest?
Changes to franking put to rest? For personal use only • During the 2015 financial year we “There is strong support for submitted our response to the Federal reducing personal income Government’s Tax Discussion Paper and company tax rates, for abolishing state stamp • Our submission argued dividend
Slide 37: Future Generation Investment Company
Future Generation Investment Company For personal use only Future Generation Investment Company (ASX: FGX) announced for FY2015: $1.644m donation to charities focused on children at risk $2.5m management and performance fees saved Fully franked 2.0c per share dividend to shareholders Since inception
Slide 38: Future Generation Global Investment Company
Future Generation Global Investment Company For personal use only $302.1m raised In September 2015, Future Generation Global Investment Company (ASX: FGG) listed on the Australian Securities Exchange after raising $302.1m $3m to charity FGG looks forward to making an annual donation of more than $3m
Slide 39: Wilson Asset Management gives
Wilson Asset Management gives For personal use only This year we launched So far our team has supported: an initiative empowering each staff member to identify causes close to them. The management company then gifts financial support for a charitable donation. All donations are made by Wilson Asset
Slide 40: Volunteering
Volunteering For personal use only Our team spent a day at volunteering at the Dandelion Support Network, which processes donated nursery equipment and children’s clothes local families 40
Slide 41: Industry recognition
Industry recognition For personal use only This year, we won the Listed Investment Companies category at the Professional Planner / Zenith Fund Awards – the second year running 41
Slide 42: Community investment
Community investment For personal use only All donations are made by Wilson Asset Management (the investment manager) and/or its staff, not the listed entities. 42
Slide 43: Investor communication
For personal use only Investor communication
Slide 44: Investor communication
Investor communication For personal use only Weekly emails Half yearly Monthly NTA Half & full year including market national investor announcement financial results update presentations & investment update Website Media Industry Independent wamfunds.com.au conferences research 44
Slide 45: Contact us
For personal use only Contact us Email: info@wamfunds.com.au Phone: (02) 9247 6755 Fax: (02) 9247 6855 Website: www.wamfunds.com.au Twitter: @WilsonAssetMgmt LinkedIn: Wilson Asset Management