Washington H. Soul Pattinson And Company Limited · ASX:SOL
Washington H. Soul Pattinson And — H1 2023 Earnings Presentation
23 slides from Washington H. Soul Pattinson And's earnings presentation, Mar 23, 2023
Slide 1: 1H23 Performance
Washington H. Soul Pattinson 1H23 Performance for the Half Year ended 31 January 2023 Thursday 23 March 2023
Slide 2: Presenters and Agenda
Presenters Agenda • Purpose • Performance highlights Robert Millner Todd Barlow Chairman CEO & Managing Director • Group results • Portfolio results • Q&A David Grbin Brendan O’Dea Chief Financial Officer Chief Investment Officer 2 ASX:SOL 1H23 Results
Slide 3: Our purpose: building enduring value for all of our shareholders
Our purpose: BUILDING ENDURING VALUE FOR ALL OF OUR SHAREHOLDERS A unique investment in the Australian market, WHSP offers shareholders exposure to a range of investments that perform throughout the cycle and have delivered above market returns for decades Our objectives: 1 2 3 GROW THE PORTFOLIO IN
Slide 4: Performance highlights
Performance highlights Performance during 1H23 Interim dividend of 36cps Net Asset Value (pre-tax) per share Total Shareholder Return ▲24.1% ▲5.3% ▲14.0% fully franked 7.4% after adding back dividends outperformance of 4.3% vs Index1 Performance against previous corresponding period (pcp) INCREASE
Slide 5: Consistent long-term performance
Consistent long-term performance • Total return on an investment in WHSP over 20 years has been 921% (vs 498% for the Index) Total Shareholder Return 6 months 1 year 5 year 10 year 15 year 20 year (p.a.) (p.a.) (p.a.) (p.a.) WHSP 14.0% 8.4% 13.5% 10.8% 12.4% 12.3% All Ords Accumulation Index 9.7% 10
Slide 6: Continued dividend growth
Continued dividend growth • Dividend increased for 23 consecutive years, underpinned by high quality, cash-generating investments • 1H23 interim dividend of 36 cents per share • Record date: 20 April 2023 • Payment date: 12 May 2023 36 36 29 25 26 23 24 21 22 19 20 17 18 14 15 12 13 11 11.5 10 8 1H0
Slide 7: Group results
Group results 7 ASX:SOL 1H23 Results
Slide 8: Financial results – 1H23 Group Profit
Financial results – 1H23 Group 1H23 1H22 Profit Regular NPAT1 $475.7m $343.7m • Growth in profit driven by performance of investments in Strategic, Large Caps, and Structured Yield Portfolios ▲38.4% vs pcp Statutory NPAT2 $453.0m $(673.6)m • Statutory profit growth driven by portfolio performance an
Slide 9: Financial results – 1H23 Key Performance Indicators
Financial results – 1H23 Key Performance 1H23 1H22 Indicators Net Cash Flows $246.5m $182.6m • Growth in cash flows driven by higher dividends and trading profits from strategic investments, and the full From Investments1 ▲35.0% vs pcp contribution of Milton’s portfolio this half Net Asset Value $10
Slide 10: Portfolio results
Portfolio results 10 ASX:SOL 1H23 Results
Slide 11: Portfolio composition
Portfolio composition • Value of the portfolio increased 5.3%1 to $10.5 billion during 1H23, with pre-tax NAV per share $29.05 • WHSP takes active asset allocation decisions and $5.2b does not invest to meet a benchmark or replicate an index 49% $426.0m divestments • 1H23 saw $1.3b in transaction ac
Slide 12: Strategic Investments
Strategic Investments • Significant, long-term investments in uncorrelated listed companies with Board representation Represents 49% of WHSP portfolio 12.8% 37.8% 43.1% 1H23 Portfolio Value $5.2b Net Cash Flows From 36.6% 29.9% 25.3% 30.3% $156.7m Investments Total return1 11.6% • Net Cash Flows of
Slide 13: Large Caps
Large Caps • Actively managed Australian equities delivering capital growth, dividends and portfolio liquidity Represents 28% of WHSP portfolio (vs 31% at 31 July) Diversified Financials 22% 1H23 Materials 14% Consumer Staples 14% Portfolio Value $2.9b Healthcare 12% Net Cash Flows From Investments
Slide 14: Large Caps – Top investments
Large Caps • Top 30 investments # Stock % of Portfolio # Stock % of Portfolio 1 Macquarie Group Limited 12.6% 16 Coles Group Limited 2.3% 2 BHP Group Limited 9.0% 17 Suncorp Group Limited 2.2% 3 CSL Limited 6.6% 18 Ramsay Health Care Limited 2.1% 4 Wesfarmers Limited 6.1% 19 ASX Limited 1.6% 5 Commo
Slide 15: Private Equity
Private Equity • Investments in unlisted companies with attractive growth profiles and strategic M&A opportunities 8% of WHSP portfolio (vs 7% at 31 July) 1H23 Portfolio Value $810.2m Net Cash Flows From Investments $13.7m Agriculture • Net Cash Flows of $13.7m declined 63.4% vs pcp mainly due to th
Slide 16: Emerging Companies
Emerging Companies • Exposure to fast growing companies often benefiting from structural changes and global trends Represents 5% of WHSP portfolio (vs 6% at 31 July) Materials 21% 1H23 Industrials 19% Portfolio Value $544.8m Consumer Discretionary 15% Net Cash Flows From Investments $24.0m Financial
Slide 17: Structured Yield
Structured Yield • Actively managed structured credit investments to achieve strong risk adjusted returns Represents 5% of WHSP portfolio (vs 2% at 31 July) Materials 1H23 Portfolio Value $483.4m Real Estate Net Cash Flows From Investments $18.8m Financials Undrawn/Committed $198.7m Weighted average
Slide 18: Property Portfolio
Property Portfolio • Actively managed direct property investments & equity accounted joint ventures Represents 1% of WHSP portfolio (vs 3% at 31 July) 1H23 Portfolio Value $112.8m Number of investments 7 • Largely concentrated in Sydney, property investments are positioned towards infrastructure dev
Slide 19: Net Working Capital
Net Working Capital • Managing portfolio liquidity via cash, interest-bearing liabilities and other assets and liabilities Represents 5% of WHSP portfolio (vs 2% at 31 July) +$203.1m in 1H23 $500.0 1H23 $400.0 Portfolio Value $476.6m Net Cashflows From Investments ($29.4m) $300.0 $200.0 • Net workin
Slide 20: 1H23 summary and Outlook
1H23 summary Outlook • Performance vs pcp • February 2023, the total portfolio outperformed Net Asset Value (pre-tax) ▲16.0% the Index1 by 2.0% as our defensive portfolio Net Cash Flows ▲35.0% settings gain traction in the current market Increased dividend ▲24.1% • Strong cash reserves and act
Slide 21: Questions
Questions
Slide 22: Glossary
Glossary The Consolidated Entity presents certain Alternative Performance Measures, including Regular and Non-Regular Profit After Tax, Net Cash Flows From Investments and Net Asset Value. These are used by management to assess the performance of the business against its principal objective of maxim
Slide 23: Disclaimer
Disclaimer Disclaimer This document has been prepared by Washington H. Soul Pattinson and Company Limited (‘WHSP’). All information contained in this document (including this notice) Any forward looking statements included in the Information This Information does not constitute an offer, invitation,
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