Sygnia Ltd. · JSE:SYG
Sygnia — IPO Roadshow (August 2015)
34 slides from Sygnia's IPO roadshow presentation, August 2015
Slide 1: Introducing Sygnia and its proposed listing
SYGNIA LIMITED INTRODUCING SYGNIA AND ITS PROPOSED LISTING AUGUST 2015
Slide 2: Disclaimer
DISCLAIMER This document, prepared by Sygnia Limited (“Sygnia” or “the Company”), has been outlined for the benefit and information of the recipient to whom this document is submitted in good faith and who is deemed by Sygnia to have accepted responsibility for ensuring that the confidentiality of t
Slide 3: Contents
CONTENTS PRIVATE PLACEMENT 4 OUR COMPANY 6 OUR BUSINESSES 16 THE NUMBERS 23 LOOKING AHEAD 25 INVESTMENT RATIONALE 29 OUR PEERS 31 TIMELINES 34
Slide 4: Private Placement
PRIVATE PLACEMENT
Slide 5: Why we are raising capital and listing
WHY WE ARE RAISING CAPITAL AND LISTING PROPOSED CAPITAL RAISING c. R300M • c. 90% NEW CAPITAL, c. 10% SALE BY FOUNDING SHAREHOLDERS CORPORATE PROFILE BENEFITS • Raises Sygnia’s corporate profile • Increases market awareness and visibility • Provides new marketing opportunities • Facilitates the “eas
Slide 6: Our Company
OUR COMPANY
Slide 7: Sygnia at a glance
SYGNIA AT A GLANCE An independent financial services group offering a range of specialist financial services, investment management solutions and administration services to institutional and retail clients predominantly located in South Africa. 2ND 11 largest multi- YEARS’ CASH GENERATIVE with healt
Slide 8: What we do...well
WHAT WE DO...WELL ASSET MANAGEMENT INVESTMENT SERVICES ADMINISTRATION SERVICES We manage assets on behalf of South African We administer assets on behalf of institutional and retail investors. domestic and international institutional investors. We offer a wide range of top-performing investment fund
Slide 9: Investment administration services
INVESTMENT ADMINISTRATION SERVICES RETIREMENT FUND Information provision: • performance reporting • compliance monitoring Transfer of contributions and benefit payments • management fees validation • reconciliations • transition management LIABILITY ADMINISTRATOR (e.g. Old Mutual, Alexander Forbes)
Slide 10: Our aspirations
OUR ASPIRATIONS • To grow and transition from a medium- to a large-sized financial services company within the next 5 years • To offer a broad range of financial products and services to both the institutional and the retail markets, with a particular focus on index-tracking • To support our product
Slide 11: Leadership and expertise: Board of Directors
LEADERSHIP AND EXPERTISE BOARD OF DIRECTORS HAROON BHORAT (46) INDEPENDENT NON-EXECUTIVE CHAIRPERSON PhD (Economics) • Professor of Economics and Director of the Development Policy Research Unit at UCT • Director on the Board of the Western Cape Tourism, Trade and Investment Promotion Agency (WESGRO
Slide 12: Leadership and expertise: Board of Directors
LEADERSHIP AND EXPERTISE BOARD OF DIRECTORS NIKI GILES (40) FINANCIAL DIRECTOR BBusSc (Finance), CA(SA), CFA • Former CFO of the African Harvest Group 17 YEARS’ FINANCIAL SERVICES EXPERIENCE KEN HOPKINS (60) INDEPENDENT NON-EXECUTIVE DIRECTOR BCom (Hons), CA(SA) • Member of SAICA’s Investment Funds
Slide 13: Leadership and expertise: Board of Directors
LEADERSHIP AND EXPERTISE BOARD OF DIRECTORS SHIRLEY ZINN (54) INDEPENDENT NON-EXECUTIVE DIRECTOR BA, HDip (Education), Bed Hons, M.Ed, Ed.M (Harvard), Ed.D (Harvard) • Chairman of DHL • Non-Executive Director on the Boards of AdvTech, Tuesday Consulting, Business Engage, and the Boston Consulting Gr
Slide 14: Our Businesses
OUR BUSINESSES
Slide 15: Our Group
OUR GROUP 100% OWNED SUBSIDIARIES OF SYGNIA LIMITED SYGNIA LTD HOLDING COMPANY – NON OPERATING Sygnia Systems (Pty) Ltd Sygnia Support Services Sygnia (Pty) Ltd Sygnia Financial Securities Services (Pty) Ltd (Pty) Ltd Sygnia Asset Management (Pty) Ltd Sygnia Collective Sygnia Alchemy Investments Syg
Slide 16: Our Group: institutional and retail focus
OUR GROUP INSTITUTIONAL CLIENT FOCUS SYGNIA ASSET MANAGEMENT An asset manager providing multi-manager, index-tracking and funds of hedge funds products (institutional and retail). RETAIL CLIENT FOCUS SYGNIA COLLECTIVE INVESTMENTS RF A management company offering multi-manager and index-tracking unit
Slide 17: Our Group: business support
OUR GROUP BUSINESS SUPPORT SYGNIA LIFE • A linked investment life insurance company. • Offers a range of savings and investment products suitable for institutional and retail investors. • The limited life license enables Sygnia Asset Management to offer pooled portfolio investment solutions to insti
Slide 18: Our people: senior management team
OUR PEOPLE SENIOR MANAGEMENT TEAM ROLE DETAILS LENGTH OF SERVICE YEARS OF AT SYGNIA EXPERIENCE CEO: Sygnia Securities Willem van der Merwe (40) 12 years 16 years BSc (Actuarial), BCom (Honours in Financial Analysis), CFA Head: Investments Simon Peile (53) 12 years 28 years BBusSc (Actuarial), FFA, C
Slide 19: The Numbers
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Slide 20: Strong organic growth
STRONG ORGANIC GROWTH Assets under management and administration (R’bn) 140 8.6 120 8.5 5.9 7.5 100 4.5 R’BN 80 128.8 60 112.4 103.0 105.1 40 82.7 70.4 62.7 20 0 SEP 10 SEP 11 SEP 12 SEP 13 SEP 14 MAR 15 JUN 15 SYGNIA INSTITUTIONAL SYGNIA RETAIL 16.4% CAGR in Sygnia Institutional 26.9% CAGR in Sygni
Slide 21: Statement of comprehensive income
STATEMENT OF COMPREHENSIVE INCOME ALL AMOUNTS IN R’M UNAUDITED 6 MONTHS AUDITED YEAR ENDED (UNLESS INDICATED OTHERWISE) ENDED 31 MARCH 2015 30 SEPTEMBER 2014 Revenue 1, 2 109.8 165.8 Interest and other investment income 8.2 15.0 Operating expenses (77.1) (126.0) Operating profit 40.9 54.8 Finance co
Slide 22: Statement of financial position
STATEMENT OF FINANCIAL POSITION HISTORIC ALL AMOUNTS IN R’M UNAUDITED AT 31 MARCH 2015 Non-current assets 25 115.0 Fixed assets 18.9 Goodwill and intangible assets 1.3 Investments 1 63.6 Investments linked to investment contract liabilities 25 028.4 Other non-current assets 2 2.8 Current assets 282.
Slide 23: Our existing shareholders
OUR EXISTING SHAREHOLDERS SYGNIA’S EXISTING SHAREHOLDERS COMPRISE EXCLUSIVELY OF MEMBERS FROM THE MANAGEMENT TEAM This management ownership aligns interests of the shareholders with the Company itself, and thereby ensures that decisions are considered and effected with a view to maximising sharehold
Slide 24: Looking Ahead
Bole) divic AHEAD
Slide 25: Where do we see the growth
WHERE DO WE SEE THE GROWTH • Sygnia’s institutional multi-manager business has the potential to attract institutional client bases of large employee benefits consulting companies in South Africa, e.g. Investment Solutions, Old Mutual. • Sygnia has a 12-year track record in managing index-tracking fu
Slide 26: Investment Rationale
INVESTMENT RATIONALE
Slide 27: Why invest in Sygnia
WHY INVEST IN SYGNIA • Experienced management team with depth of knowledge of the financial services industry • Successful track record of organic growth and value creation • Proprietary, market leading systems enable service scalability • Long-standing distribution relationships to support growth •
Slide 28: Our Peers
OUR PEERS
Slide 29: Our competitors
OUR COMPETITORS SYGNIA HAS DIFFERENT COMPETITORS IN DIFFERENT AREAS OF ITS BUSINESS In terms of AUM, Sygnia’s R137bn as at 30 June 2015 compares as follows to its competitors: Alexander Forbes Manager Watch Survey of Retirement Fund Investment Managers (December 2014) RANK ASSET MANAGER AUM (R’000)
Slide 30: Our peers: earnings composition
OUR PEERS EARNINGS COMPOSITION Coronation Alexander Forbes PSG Konsult 8.9% Sygnia 34.6% PAT LFY PAT LFY PAT LFY R2 032m R253m R340m FY2014 PAT 100% 65.4% 91.1% R38.5m Anchor Prescient Peregrine 1H2015 PAT 0.9% 29.3% 46.5% R29.3m PAT LFY R24m PAT LFY R129m PAT LFY R677m 100% 99.1% 70.7% 53.5% Asset
Slide 31: Peers multiple analysis
PEERS MULTIPLE ANALYSIS MARKET ATTRIBUTABLE DIVIDEND P/E MULTIPLE 2 CAP 1 EARNINGS GROWTH 3 YIELD PEER ANALYSIS R ‘M 30 SEP 14 30 SEP 15 30 SEP 16 HISTORIC FORECAST CURRENT Coronation 26 934.5 13.3x 14.7x 12.2x 46.7% 4.0% 6.9% Prescient 1 668.6 13.8x n/a n/a 21.9% n/a 5.2% Anchor 1 681.4 87.9x n/a n
Slide 32: Timelines
TIMELINES
Slide 33: Proposed timeline
PROPOSED TIMELINE DATE (2015) DESCRIPTION Monday, 14 September Commence final investor roadshows Friday, 18 September Conclude final investor roadshows Thursday, 1 October Pre-listing statement published Thursday, 1 October Private placement opens Thursday, 8 October Private placement closes Friday,
Slide 34: Thank you
THANK YOU