Invesco Ltd · NYSE:IVZ
Invesco — Q2 2015 Earnings Presentation
43 slides from Invesco's earnings presentation, Jul 30, 2015
Slide 1: Invesco second quarter 2015 results
Invesco second quarter 2015 results Martin L. Flanagan President and Chief Executive Officer Loren M. Starr Chief Financial Officer July 30, 2015
Slide 2: Forward-looking statements
Forward-looking statements This presentation, and comments made in the associated conference call today, may include “forward-looking statements.” Forward-looking statements include information concerning future results of our operations, expenses, earnings, liquidity, cash flow and capital expendit
Slide 3: Discussion topics
Discussion topics Second quarter overview Investment performance and flows Financial results Questions Appendix 2
Slide 4: Second quarter overview
Second quarter overview Continued strong investment performance and our focus on meeting client needs contributed to solid operating results Maintained strong, long-term investment performance – 75% and 79% of actively managed assets ahead of peers on a 3- and 5-year basis Long-term net inflows
Slide 5: Summary of second quarter 2015 results
Summary of second quarter 2015 results Assets under June 30, 2015, AUM of $803.6 billion, versus $798.3 billion at management March 31, 2015 Average AUM was $810.9 billion,versus $795.4 billion for the first quarter of 2015 Flows Long-term net inflows of $5.9 billion Total net inflows of $3.
Slide 6: Discussion topics
Discussion topics Second quarter overview Investment performance and flows Financial results Questions Appendix 5
Slide 7: Investment performance – overview
Investment performance – overview Aggregate performance analysis – asset weighted Percent of actively managed assets in top half of peer group* 1-Year 3-Year 5-Year 66% 75% 79% 25% 21% 34% Assets top half of peer group Assets bottom half of peer group Excludes passive products, closed-end funds, pri
Slide 8: Quarterly long-term flows
Quarterly long-term flows Positive active and passive flows during the quarter Quarterly long-term flows ($ billions) Total Active Passive 52.1 43.1 50.2 50.5 41.6 40.6 45.8 46.0 37.2 36.1 36.2 36.4 41.8 42.5 44.4 33.1 9.9 9.6 8.7 8.6 8.6 9.0 8.2 10.3 6.8 6.4 6.5 5.9 4.8 6.0 5.0 5.4 1.0 6.0 2.5 3.2
Slide 9: Quarterly long-term flows
Quarterly long-term flows Strong institutional flows during the quarter Quarterly long-term flows ($ billions) Retail(a) Institutional(b) 17.9 39.6 40.3 35.5 35.8 36.3 34.8 35.7 34.2 10.0 10.6 9.6 10.3 10.2 6.4 6.3 6.2 6.5 7.6 7.5 4.8 0.8 1.7 2.8 1.3 1.3 1.2 -0.3 -0.5 -8.2 -1.5 -1.1 -4.9 -29.0 -7.4
Slide 10: Discussion topics
Discussion topics Second quarter overview Investment performance and flows Financial results Questions Appendix 9
Slide 11: Total assets under management – 2Q15 vs. 1Q15
Total assets under management – 2Q15 vs. 1Q15 ($ billions) 2Q-15 1Q-15 % Change Beginning Assets $798.3 $792.4 0.7% Long-Term Inflows 52.1 50.5 3.2% Long-Term Outflows (46.2) (40.2) 14.9% Long-Term Net flows 5.9 10.3 (42.7)% Net flows in Invesco PowerShares QQQ (0.3) (2.6) (88.5)% Net flows in Inst.
Slide 12: Non-GAAP operating results – 2Q15 vs. 1Q15
Non-GAAP operating results – 2Q15 vs. 1Q15 ($ millions) 2Q-15 1Q-15 % Change Adjusted Revenues Investment Management Fees 1,083 1,024 5.8% Service and Distribution Fees 220 213 2.9% Performance Fees 13 52 (74.7)% Other 38 31 21.5% Third-Party Distribution, Service and Advisory Expenses (417) (402) 3
Slide 13: Second quarter overview
Second quarter overview Continued strong investment performance and our focus on meeting client needs contributed to solid operating results Maintained strong, long-term investment performance – 75% and 79% of actively managed assets ahead of peers on a 3- and 5-year basis Long-term net inflows
Slide 14: Discussion topics
Discussion topics Second quarter overview Investment performance and flows Financial results Questions Appendix 13
Slide 15: Discussion topics
Discussion topics Second quarter overview Investment performance and flows Financial results Questions Appendix 14
Slide 16: We are diversified as a firm
We are diversified as a firm Delivering a diverse set of solutions to meet client needs By client domicile By channel By asset class 3% 12% 14% 67% 23% 66% 33% 49% 10% 9% 7% 7% 1-Yr 1-Yr 1-Yr ($ billions) Change ($ billions) Change ($ billions) Change U.S. $530.8 (1.2)% Retail $541.3 (0.6)% Equity $
Slide 17: Investment performance by investment objective
Investment performance By investment objective (actively managed assets)* Equities AUM above benchmark 1st quartile 2nd quartile U.S. Core U.S. Growth U.S. Value Sector 100% 100% 100% 100% 100% 98% 98% 7% 81% 77% 74% 68% 45% 5% 21% 52% 26% 70% 36% 3% 33% 48% 3% 26% 39% 32% 29% 26% 26% 15% 15% 18% 8%
Slide 18: Investment performance by investment objective (continued)
Investment performance By investment objective (actively managed assets)* (CONTINUED) Equities Other AUM above benchmark 1st quartile 2nd quartile Global Global ex-U.S. and Em. Mkts. Alternatives Balanced 100% 100% 100% 100% 99% 86% 86% 86% 21% 74% 72% 71% 67% 13% 59% 51% 57% 7% 26% 57% 23% 86% 44%
Slide 19: Investment performance (5-year) by investment objective
Investment performance (5-year) By investment objective (actively managed assets)* Percentages in parentheses represent % AUM of each investment objective as a ratio of all objectives (Total ranked AUM of $467.2 billion) % of assets top % of assets bottom Equities half of peer group half of peer gro
Slide 20: Investment performance (5-year) by investment objective (continued)
Investment performance (5-year) By investment objective (actively managed assets)* (CONTINUED) Percentages in parentheses represent % AUM of each investment objective as a ratio of all objectives (Total ranked AUM of $467.2 billion) % of assets top % of assets bottom Equities Other half of peer grou
Slide 21: Non-GAAP operating results – quarterly
Non-GAAP operating results – quarterly ($ millions) 2Q-15 1Q-15 % Change* 4Q-14 3Q-14 2Q-14 1Q-14 4Q-13 3Q-13 Investment Management Fees 1,083 1,024 5.8% 1,033 1,071 1,055 989 983 938 Service and Distribution Fees 220 213 2.9% 218 222 215 239 230 221 Performance Fees 13 52 (74.7)% 19 10 7 34 11 9 Ot
Slide 22: US GAAP operating results – quarterly
US GAAP operating results – quarterly ($ millions) 2Q-15 1Q-15 % Change* 4Q-14 3Q-14 2Q-14 1Q-14 4Q-13 3Q-13 Investment Management Fees 1,056 1,001 5.4% 1,010 1,047 1,032 965 955 914 Service and Distribution Fees 220 213 2.9% 218 222 215 239 230 221 Performance Fees 7 47 (85.7)% 17 8 5 31 9 5 Other
Slide 23: Total assets under management – quarterly
Total assets under management – quarterly ($ billions) 2Q-15 1Q-15 % Change 4Q-14 3Q-14 2Q-14 Beginning Assets $798.3 $792.4 0.7% $789.6 $802.4 $787.3 Long-Term Inflows 52.1 50.5 3.2% 46.0 44.4 42.5 Long-Term Outflows (46.2) (40.2) 14.9% (43.5) (38.4) (49.4) Long-Term Net flows 5.9 10.3 (42.7)% 2.5
Slide 24: Total assets under management – by asset class
Total assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Alternative Income Market December 31, 2014 $792.4 $384.4 $181.6 $50.6 $76.5 $99.3 Long-Term Inflows 50.5 24.5 10.8 4.1 0.7 10.4 Long-Term Outflows (40.2) (21.5) (7.2) (3.2) (0.9) (7.4) Long-Term Net flows
Slide 25: Total assets under management – by asset class
Total assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Alternative Income Market June 30, 2014 $802.4 $394.2 $181.9 $52.6 $77.1 $96.6 Long-Term Inflows 44.4 22.1 8.3 4.6 1.1 8.3 Long-Term Outflows (38.4) (19.8) (9.0) (3.0) (0.9) (5.7) Long-Term Net flows 6.0 2.
Slide 26: Total assets under management – by channel
Total assets under management – by channel ($ billions) Total Retail Institutional December 31, 2014 $792.4 $532.5 $259.9 Long-Term Inflows 50.5 40.3 10.2 Long-Term Outflows (40.2) (32.8) (7.4) Long-Term Net flows 10.3 7.5 2.8 Net flows in Invesco PowerShares QQQ (2.6) (2.6) - Net flows in Inst. Mon
Slide 27: Total assets under management – by channel
Total assets under management – by channel ($ billions) Total Retail Institutional June 30, 2014 $802.4 $544.8 $257.6 Long-Term Inflows 44.4 34.8 9.6 Long-Term Outflows (38.4) (30.0) (8.4) Long-Term Net flows 6.0 4.8 1.2 Net flows in Invesco PowerShares QQQ (3.2) (3.2) - Net flows in Inst. Money Mar
Slide 28: Total assets under management – by client domicile
Total assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe December 31, 2014 $792.4 $532.1 $25.8 $105.1 $71.1 $58.3 Long-Term Inflows 50.5 26.1 1.0 4.9 12.2 6.3 Long-Term Outflows (40.2) (22.0) (1.0) (4.3) (7.2) (5.7) Long-Term Net flows 10.3 4.1 -
Slide 29: Total assets under management – by client domicile
Total assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe June 30, 2014 $802.4 $537.5 $28.7 $107.6 $70.4 $58.2 Long-Term Inflows 44.4 23.1 1.0 4.0 9.9 6.4 Long-Term Outflows (38.4) (22.5) (1.1) (5.1) (5.6) (4.1) Long-Term Net flows 6.0 0.6 (0.1) (
Slide 30: Passive assets under management – by asset class
Passive assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Alternative Income Market December 31, 2014 $141.4 $88.2 $41.1 - - $12.1 Long-Term Inflows 9.9 6.5 2.0 - - 1.4 Long-Term Outflows (6.4) (3.5) (1.2) - - (1.7) Long-Term Net flows 3.5 3.0 0.8 - - (0.3) Net
Slide 31: Passive assets under management – by asset class
Passive assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Income Market Alternative June 30, 2014 $145.8 $89.0 $42.0 - - $14.8 Long-Term Inflows 8.2 4.9 2.4 - - 0.9 Long-Term Outflows (8.2) (3.5) (3.5) - - (1.2) Long-Term Net flows - 1.4 (1.1) - - (0.3) Net flow
Slide 32: Passive assets under management – by channel
Passive assets under management – by channel ($ billions) Total Retail Institutional December 31, 2014 $141.4 $119.7 $21.7 Long-Term Inflows 9.9 8.9 1.0 Long-Term Outflows (6.4) (5.8) (0.6) Long-Term Net flows 3.5 3.1 0.4 Net flows in Invesco PowerShares QQQ (2.6) (2.6) - Net flows in Inst. Money Ma
Slide 33: Passive assets under management – by channel
Passive assets under management – by channel ($ billions) Total Retail Institutional June 30, 2014 $145.8 $123.9 $21.9 Long-Term Inflows 8.2 6.5 1.7 Long-Term Outflows (8.2) (5.7) (2.5) Long-Term Net flows - 0.8 (0.8) Net flows in Invesco PowerShares QQQ (3.2) (3.2) - Net flows in Inst. Money Market
Slide 34: Passive assets under management – by client domicile
Passive assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe December 31, 2014 $141.4 $137.6 $0.2 - $1.8 $1.8 Long-Term Inflows 9.9 9.6 - - 0.2 0.1 Long-Term Outflows (6.4) (6.1) - - (0.2) (0.1) Long-Term Net flows 3.5 3.5 - - - - Net flows in Inve
Slide 35: Passive assets under management – by client domicile
Passive assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe June 30, 2014 $145.8 $141.7 $0.1 - $1.8 $2.2 Long-Term Inflows 8.2 8.0 0.1 - - 0.1 Long-Term Outflows (8.2) (8.0) - - (0.1) (0.1) Long-Term Net flows - - 0.1 - (0.1) - Net flows in Invesc
Slide 36: Reconciliation of US GAAP to non-GAAP – three months ended June 30, 2015
Reconciliation of US GAAP results to non-GAAP results – three months ended June 30, 2015 Please refer to pages 19-22 in the 2Q 2015 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAAP Co
Slide 37: Reconciliation of US GAAP to non-GAAP – three months ended March 31, 2015
Reconciliation of US GAAP results to non-GAAP results – three months ended March 31, 2015 Please refer to pages 18-21 in the 1Q 2015 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAAP C
Slide 38: Reconciliation of US GAAP to non-GAAP – three months ended December 31, 2014
Reconciliation of US GAAP results to non-GAAP results – three months ended December 31, 2014 Please refer to pages 22-26 in the 4Q 2014 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAA
Slide 39: Reconciliation of US GAAP to non-GAAP – three months ended September 30, 2014
Reconciliation of US GAAP results to non-GAAP results – three months ended September 30, 2014 Please refer to pages 19-22 in the 3Q 2014 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GA
Slide 40: Reconciliation of US GAAP to non-GAAP – three months ended June 30, 2014
Reconciliation of US GAAP results to non-GAAP results – three months ended June 30, 2014 Please refer to pages 19-22 in the 2Q 2014 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party distribution, Acquisition Market appreciation / Consolidated Non
Slide 41: Reconciliation of US GAAP to non-GAAP – three months ended March 31, 2014
Reconciliation of US GAAP results to non-GAAP results – three months ended March 31, 2014 *Please refer to pages 18-22 in the 1Q 2014 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAAP
Slide 42: Reconciliation of US GAAP to non-GAAP – three months ended December 31, 2013
Reconciliation of US GAAP results to non-GAAP results – three months ended December 31, 2013 *Please refer to pages 19-21 in the 4Q 2013 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GA
Slide 43: Reconciliation of US GAAP to non-GAAP – three months ended September 30, 2013
Reconciliation of US GAAP results to non-GAAP results – three months ended September 30, 2013 * Please refer to pages 19-21 in the 3Q 2013 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-