St. James's Place Plc · LSE:STJ
St. James's Place — Investor Presentation (November 2022)
49 slides from St. James's Place's investor presentation, Nov 16, 2022
Slide 1: St. James's Place
S! Jamess Place ave SIL
Slide 2: Contents
SJP Contents /T\4 If] { \ \ ; | \ (| J LE JA QU ZK QU, 2 Overview: Our business Ournew Our financial Appendix Business in detail business performance model and performance strategy
Slide 3: Overview: business model and strategy
O iew: busi » model x clraleny \ J yA \ SJP
Slide 4: Leading UK Wealth Management Company Established 1991
Leading UK Wealth Differentiated advice-led Well positioned to benefit Management Company business model from long-term market Established 1991 Dedicated advice growth UK listed with market cap led distribution – Favourable demographic of c.£7 billion The Partnership trends £154 billion in FUM Disti
Slide 5: Mass affluent and high net worth individuals
UK aggregate wealth by age cohort 30% 27% 25% 24% 23% ‘mass affluent’ 20% and high net worth individuals… 15% …controlling £3.1tn of liquid assets 10% 10% 10% 5% 3% 3% 0% 0% 16 - 24 25 - 34 35 - 44 45 - 54 55 - 64 65 - 74 75 - 84 85 and over 87% 5
Slide 6: Client net outcomes
Financial Investment Client net planning returns outcomes Trusted personal relationship 6
Slide 7: Perfect environment for client-focused advice business
Flexibility + Tax complexity Intergenerational complexity via ‘pension Wealth Transfer freedom’ Perfect environment for client-focused Decline of Growing UK advice business DB pensions savings gap 7
Slide 8: The UK advice gap is large
Number of UK retail investment advisers The UK advice gap is large 50,000 45,000 40,000 Only a quarter of UK adults 35,000 currently seek advice 30,000 25,000 3.7 million individuals with £50k+ 20,000 of investable assets, are open to 15,000 advice but currently unadvised 10,000 5,000 0 Number of UK
Slide 9: Benefits of Vertical integration
Benefits Advice Our clients: an end-to-end, connected proposition focused on great long-term outcomes Platform & Vertical Administration Our Partnership: superior support integration to build a great business over the long-term Investments Our shareholders: long-term, sustainable growth in funds und
Slide 10: Where we're going: vision and 2025 goals
Where we’re going Our vision Our 2025 goals ‘To support the UK's leading Financial Significant annual growth in annual retention growth in cash Advisers with the best gross inflows of client FUM* result and technology, best shareholder operations and best returns proposition for them growth in FUM a
Slide 11: Delivering value to clients through our IMA
Building Delivering value Our culture and community to clients through being a leading responsible our IMA business Building and protecting Making it easier Continued our brand and to do business financial strength reputation 11
Slide 12: Our business
SJP Our business ity Ta /
Slide 13: Supporting clients, building great businesses
Clients Supporting clients The Partnership Building great Financial businesses Partner businesses advisers Proposition FUM Tech 13
Slide 14: Attraction and retention
Strong Great client Strong products outcomes commercial and proposition Attraction and relationship retention Flexible business Comprehensive development corporate support 14
Slide 15: A sustainable pipeline for growth in the Partnership
Strong adviser retention A sustainable Value of long-term Mix of Academy pipeline for Partnerships and recruitment growth in the channels Partnership Average age 46 (lower than market) 15
Slide 16: Average age of Partners and Advisers
Average age Partners and Academy from non- new advisers of new client referred Advisers refreshed financial in training at investments by the delivered backgrounds end-2021 in 2021 Partnership 16
Slide 17: Existing advisers and new advisers by age
Existing advisers New advisers 3% 1% 11% 15% 20% <35 <35 37% 35-45 35-45 21% 45-55 45-55 55-65 55-65 65+ 65+ 29% 33% 30% 17
Slide 18: Great client outcomes drive strong productivity
Targeted growth and development support Great client outcomes drive Business strong productivity consultancy of new business Coaching and through referrals leadership development 18
Slide 19: New and improved systems
New and Utilisation of improved Partner lending to systems support business and tech development Targeted, data-led More shared field management servicing team support of clients 19
Slide 20: Clients: average age and overseas clients
5% Clients Average age Overseas clients 1% No ‘typical’ client - all want trusted, 13% personal advice Male/female split 3% 4% 15% 15% 25% 10% Geographic distribution of client FUM as at 31/12/21 20
Slide 21: Existing clients and new clients
Existing clients New clients 6% 8% 23% 6% <30 19% 16% <30 30-40 30-40 16% 40-50 40-50 50-60 50-60 13% 60-70 60-70 70+ 70+ 22% 17% 26% 17% 21
Slide 22: Our investment proposition
Our investment proposition SJP Solutions @ ta) N 2 ol £154bn Multi-asset Investment Group FUM Stockbroking Discretionary Fund Management (DFM) portfolios building blocks/funds 13,000+ individual stocks and bonds Investment Management Approach (IMA) Plan » Design 22
Slide 23: Our recipe for long-term performance
People & Team Our recipe Investment Data, Tech for long-term beliefs & Insights performance Investor Governance 23
Slide 24: Our investment proposition: our seven beliefs
Our investment proposition: our seven beliefs 1. Great client 2. Asset 3. Diversification outcomes collection oe As 1¢!
Slide 25: Strategic Enablers
Enable financial wellbeing for our clients, our people and our communities Lead the conversation on investing responsibly Take action on climate change Strategic Enablers People Governance Responsible Relationships Risk Management Inclusion and Diversity Data privacy Giving back to support Policy in
Slide 26: Responsible investment as standard
Responsible investment as standard − All our managers are UN PRI signatories − RI key to selection and monitoring process across all funds and strategies − Focus on stewardship and engagement Tailored and bespoke RI solutions also available for clients Member of Net Zero Asset Owner Alliance − Commi
Slide 27: Bluedoor: Salesforce, Data & AI
Bluedoor Enabling scalability and Delivering efficiency within SJP Scalability growth Next Generation Salesforce Client Experience (NGCX) Hyper-personalised service Efficiency Resilience delivery and efficiency Data &AI Reduce Reduce Leading to a data and AI complexity operational risk integrated ec
Slide 28: Our new business performance
SJP Our new business BerPormance
Slide 29: The Partnership grew 5% in 2021 to 4,556 advisers
5,000 The Partnership grew 5% 4,500 in 2021 to 4,556 advisers 4,000 Strong pipeline for Academy enrolment 3,500 and experienced recruitment 3,000 350 new advisers in training in the 2,500 Academy at end-21 2,000 1,500 1,000 500 0 2014 2015 2016 2018 2019 2020 2021 29
Slide 30: A record year for new business in 2021
£20bn A record year for new business in 2021 £18bn − Gross inflows of £18.2 billion, up 27% £16bn − Strong underlying performance £14bn − Also benefiting from excess savings and a more favourable operating environment £12bn Strong start to 2022 with gross inflows of £10bn £4.7 billion, maintaining t
Slide 31: Gross inflows: progress against our 2025 plan
£bn Gross inflows: progress Growth in new business will not be linear 25 against our 2025 plan There will naturally be variations in growth rates from quarter to quarter and year 20 to year Great start to 2025 ambitions 15 2022 consensus forecasts are ahead of 10 where we would have expected to be f
Slide 32: Record year for net inflows, up 34% to £11.0 billion
£12bn Record year for net inflows, up 34% to £10bn £11.0 billion, driven by: − Strong new business performance £8bn − Exceptional retention of client investments: 96% excluding regular withdrawals and £6bn maturities Maintaining our track record of net £4bn inflows in every quarter of every year in
Slide 33: >15% p.a. compound growth over the last 5, 10 and 15 years
£bn >15% p.a. compound growth over the last 5, 10 and 15 years 180 160 140 120 100 80 60 40 20 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 33
Slide 34: Our financial performance
Our financia 1 MaAnc’e SJP
Slide 35: Robust Solvency II position
Underlying EEV NAV per share Full year dividend EEV operating cash result £16.57, up 14% 51.96 pence per profit £401.2 million, share, up 35% £1,545.4 million, up 52% up 68% Robust Solvency II position 35
Slide 36: Underlying cash result up 52% to £401.2 million
Underlying cash result up 52% to £m £401.2 million, driven by: 450 +52% − Growth in FUM in both 2020 and 2021 leading 400 401.2 to growth in net income from FUM 350 − Contribution of over £40 million to 2021 net 300 income from FUM due to maturing FUM 250 264.7 − Strength of new business, which both
Slide 37: Gestation balance now stands at £49.3 billion
£m Contribution of gestation FUM to the Cash result Gestation balance now stands at 450 £49.3 billion 400 This will contribute over £390 million per annum to the Cash result from 350 2027 onwards when it all matures 300 − Using simple modelling which assumes for 250 example that FUM values remain 20
Slide 38: EEV NAV per share of £16.57, up 14%
EEV NAV per share of £16.57, up 14% £ over past 12 months 16 Excludes additional c.£395 million 14 (or c. 73 pence per share) value 12 of pensions business falling outside of current contract boundaries 10 8 6 4 2 0 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 38
Slide 39: Full year dividends set in line with policy
Full year dividends set in line with policy at 70% of the Underlying cash result Full year dividend of 51.96 pence per share, growth of 35% Proposal final dividend of 40.41 pence per share 39
Slide 40: Demand for trusted face to face financial advice remains strong
Demand for trusted face to face financial advice remains as strong as ever St. James’s Place ideally placed − Academy − Proven investment approach − Modern and scalable infrastructure − Unique culture and refreshed brand Remain confident of achieving our 2025 ambitions and continuing to prosper ther
Slide 41: Appendix
Appendix SJP
Slide 42: Quarterly net inflows 2008-2022
3.5 3.0 2.5 2.0 1.5 1.0 0.5 0.0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 42
Slide 43: Climate positive in our operations
Climate Net Zero Support our Net Zero in positive in our throughout our Partnership our investments operations supply chain becoming Net by 2050 by 2025 by 2035 Zero by 2035 43
Slide 44: Singapore and Hong Kong people with US$100,000 to US$1m to invest
Singapore and Hong Kong people with US people with $100,000 US $1m – US $1m to invest – US $30m to invest total asset pool 44
Slide 45: Who? What? Why SJP?
Who? What? Why SJP? International family Trusted brand, long-term wealth structuring relationships and great client outcomes Expats and high net Wealth extraction worth Singaporean for entrepreneurial Joint UK/Asia focus and Hong Kong families and expertise Nationals Long-term capital Increasingly A
Slide 46: A clear plan to create long-term value
A clear plan to create long-term value Positioned to target expats and HNW individuals Building 100 great Asia Partner businesses Long-term, advice-led proposition Delivering cash break-even by 2025 46
Slide 47: Analyst coverage
Autonomous Andrew Crean JPMorgan Enrico Bolzoni Barclays Larissa van Deventer KBW Charles Beeching Bank of America Andrew Sinclair Mediobanca Fahad Changazi Berenberg Adam Barrass Morgan Stanley Ashik Musaddi Citi Andrew Baker Numis David McCann Deutsche Bank Rhea Shah Panmure Gordon Rae Maile Exane
Slide 48: Reduction in Yield assessment at 31 March 2022
The results to the assessment at 31 March 2022: 3.5% 2.3% 1.3% The firm represented by the first bar (Reduction in Yield of 1.3% each year) does not offer an ongoing advice service. The figures shown have been produced by Ernst & Young LLP (‘EY’), an external consultancy. They show the Reduction in
Slide 49: Investor Relations contacts
Craig Gentle Hugh Taylor Chief Financial Officer Investor Relations Director Email: craig.gentle@sjp.co.uk Email: hugh.taylor@sjp.co.uk Tel: +44 207 514 1963 Tel: +44 207 514 1963 www.sjp.co.uk/shareholders
St. James's Place — Investor Presentation (November 2022) on 6ix