Rathbones Group PLC · LSE:RAT
Rathbones — Rathbone Brothers — H1 2002 Earnings Presentation
20 slides from Rathbones's earnings presentation, August 2002
Slide 1: Rathbone Brothers Plc Half Year Results 30th June 2002
Rathbone Brothers Plc Half Year Results 30th June 2002
Slide 2: Speakers
Speakers Micky Ingall Chairman Mark Powell Managing Director Andy Pomfret Finance Director Paul Chavasse Director - IT & Operations Page 1
Slide 3: Executive Committee
Executive Committee Micky Ingall Roy Morris Mark Powell Chairman Chief Executive Managing Director Andy Pomfret James Lifford Paul Egerton-Vernon Paul Chavasse Finance Director Director - Director - Trust Division Director - IT & Operations Regional Centres Page 2
Slide 4: Results Highlights
Results Highlights Pre-tax profits £11.4 million + 2% (pre goodwill amortisation) Earnings per share 22.7p - 4% (pre goodwill amortisation) Interim dividend 10p Maintained 30/06/2001 - £6.0bn - 2% (year) Discretionary funds under management 31/12/2001 - £5.8bn + 2% (6 months) 30/06/2002 - £5.9bn 30/
Slide 5: Strategy
Strategy To be the leading provider of discretionary investment management and trust services to the Private Client in the UK Further acquisitions of people and companies if demonstrably earnings enhancing in the medium term Focus will remain on Private Clients Link rewards to successful gro
Slide 6: Discretionary funds under management
Discretionary funds under management 7000 6000 5000 4000 3000 2000 1000 0 30.06.97 31.12.97 30.06.98 31.12.98 30.06.99 31.12.99 30.06.00 31.12.00 30.06.01 31.12.01 30.06.02 Funds Under Management (£m) Funds Under Management (Interims) FTSE 100 Index (Rebased) Page 5
Slide 7: Market Movements and Funds Under Management
Market Movements and Funds Under Management FTSE 100 5 Years + 1.1% 1 Year - 17.5% 6 Months - 10.8% APCIMS - Balanced Index 5 Years + 6.8% 1 Year - 13.9% 6 Months - 8.4% Over Year Over 6 months Split of Growth in Acquisitions £987m £322m FUM New Business £319m £206m Market Movement - £1,363m -
Slide 8: Key Developments
Key Developments New Fund Managers have joined us in each of the last three years as follows:- 2000 12 2001 21 2002 (to June) 5 Entry into FTSE 250 Index Recent exercise of options over companies £13.1m in 6 months to June - more to come in the second half (£13.7m in July). New Business Sche
Slide 9: Operations & IT
Operations & IT Focus on Liverpool Part of the service; not outsourced New management structure Improved processes and systems IT spend; progressive internal development Page 8
Slide 10: Dealing Developments
Dealing Developments Efficiencies and cost savings Closure of one of two broking systems/companies Creation of one centralised dealing hub for all core Discretionary business All deals now routed electronically Page 9
Slide 11: Productivity of Liverpool Operations Staff
Productivity of Liverpool Operations Staff (based on number of core Discretionary clients) 125 120 118.7 115 Indexed to 100 110 112.5 108.3 105 102.9 100 100 95 90 Jun-01 Sep-01 Dec-01 Mar-02 Jun-02 Page 10
Slide 12: Number of Staff in Liverpool Operations Department
Number of Staff in Liverpool Operations Department Reconciliations: 10 Management & Projects: 10 Dividends & Corporate Actions: 17 Transfers: 20 Total Staff: 111 Settlements: 14 Contracts: 13 Static Data: 16 Page 11
Slide 13: Performance Record
Performance Record Quartile Performance 6m 1 yr 3 yrs 5 yrs Micropal Rathbone Capital Growth Fund 4 4 1 N/A ***** Rathbone Global Companies Fund 2 3 N/A N/A (launched April 2001) Rathbone Income Fund 1 1 1 1 ***** Rathbone Income and Growth Fund 1 1 1 1 **** Rathbone Smaller Companies Fund 3 3 1 1 *
Slide 14: Trust Division
Trust Division Income up by 8% but PBT down 47% Three principal reasons for fall: Adverse exchange rate movement (clients billed in $) Additional provisions for doubtful debts (one very significant) Margins under pressure; less new business Additional goodwill amortisation Significant
Slide 15: Current Trading
Current Trading Markets unhelpful! Continuing to invest for the future Recruitment Continuing to attract new clients Trust Division Developing the Business nationally Cash positive Brand Creation Page 14
Slide 16: Appendices
Appendices RATHBONES Established 1742
Slide 17: 12 Month Share Price Performance
12 Month Share Price Performance 150 140 130 120 110 100 90 80 70 60 50 40 Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Rathbones Brewin Dolphin BWD Securities Schroders (i)
Slide 18: Staff Numbers by Function
Staff Numbers by Function 250 248 200 150 152 142 133 100 101 50 22 0 Investment Investment IT, Finance, Trust Trust Support Other Managers & Management Personnel, Professionals Assistants Operations Marketing & Compliance (ii)
Slide 19: Analysis of Expenditure
Analysis of Expenditure Settlements: £2.493m Depreciation: £3.019m Professional: £1.611m Other Costs: £1.811m IT Costs:£1.357m Premises: £2.141m Staff Costs: £17.857m (of which 10% is Other Staff Costs: £1.632m variable bonus) (iii)
Slide 20: Consolidated Balance Sheet for the six months ended 30th June 2002
Consolidated Balance Sheet for the six months ended 30th June 2002 30th June 2001 30th June 2001 30th June 2002 (Restated) 30th June 2002 (Restated) Unaudited Unaudited Unaudited Unaudited £’000 £’000 £’000 £’000 Liabilities Assets Deposits by banks 981 868 Cash and balances at central banks 3,831 5