Australian Ethical Investment Ltd · ASX:AEF
Australian Ethical Investment — AEF Brisbane Investor Conference (May 2016)
25 slides from Australian Ethical Investment's conference presentation, May 19, 2016
Slide 1: Australian Ethical Investment
For personal use only Australian Ethical Investment Phil Vernon, Managing Director
Slide 2: Who We Are
For personal use only Who We Are
Slide 3: Overview
Overview HIGHLIGHTS SHARE PRICE PERFORMANCE, VOLUME For personal use only 70 Leading ethical investment and superannuation 60 manager 50 30 year history 40 $ Top quartile investment performance 30 20 A$1.5 billion in FUM 10 Numerous industry awards 12,000 10,000 8,000 Volume 6,000 FINANCIA
Slide 4: Where we invest
Where we invest For personal use only We invest in areas such as: We avoid companies involved in: 4
Slide 5: Business model
Business model For personal use only Vertically-integrated business, offering a broad range of products, across most asset classes accessed through multiple channels Channels Direct Employers Advisers Product Super and Pension Managed funds A$950m (67%) A$478m (33%) packaging 13 options 8 products I
Slide 6: Product and channel breakdown
Product and channel breakdown For personal use only Total = $1.5bn 15% Super (Direct) 18% 60% Super (Advised) Managed Funds (Direct) Managed Funds (Advised) 7% 6
Slide 7: The opportunity
For personal use only The opportunity
Slide 8: Our target market
Our target market For personal use only • Target: 1.5m highly ethical consumers or 10% of the investing public • Penetration: 25,000 or 2% of target market 8
Slide 9: Our strategy
For personal use only Our strategy
Slide 10: Trends to 2020
Trends to 2020 For personal use only Rising social consciousness Increasing social consciousness is having a profound impact on ethical consumerism and investment. In the past 2 years, money flowing into ethical funds has doubled and currently 40% of consumers consider themselves to be ethical. This
Slide 11: Trends to 2020
Trends to 2020 For personal use only Customer expectations Customers will increasingly demand better service as the “instant gratification” culture continues to perpetuate. The success of businesses and products will be driven by features, service, and how easy they are to deal with. Fee pressure As
Slide 12: Our pathway to 2020
Our pathway to 2020 For personal use only Educate the ethical consumer We aim to educate the ethically-conscious, but inactive investor, on how to align their investment practices with their values. Bust the investment myth We aim to bust the myth that ethical investments underperform by providing t
Slide 13: Our pathway to 2020
Our pathway to 2020 For personal use only Digital mastery We will invest in our digital skills and capability to ensure that we are at the cutting edge of developments in digital and online marketing techniques, transaction optimisation and delivery of advice and content. Competitive fees We aim to
Slide 14: Channel strategy
Channel strategy For personal use only Our strong, highly engaged digital community, targeted digital advertising, optimisation of the online experience and support of many aligned organisations continues to give us strong growth from the Direct direct channel. We aim to be the default superannuatio
Slide 15: Our Performance
For personal use only Our Performance
Slide 16: Digital community
For personal use only - 10,000 20,000 30,000 50,000 60,000 70,000 80,000 100,000 40,000 90,000 Aug-13 Sep-13 Oct-13 Nov-13 Dec-13 Jan-14 Feb-14 Mar-14 Apr-14 May-14 Digital community Jun-14 Jul-14 Aug-14 Sep-14 Oct-14 Nov-14 Dec-14 Jan-15 Feb-15 Facebook Followers Mar-15 Apr-15 May-15 Jun-15 Jul-15
Slide 17: Highly engaged audience
Highly engaged audience For personal use only Facebook engagement rate 12% 10% 8% 6% 4% 2% 0% 17 Engagement Rate: Average engagement represented as a % of total fans Q2 2016
Slide 18: Top quartile asset management performance
Top quartile asset management performance For personal use only Regular top quartile performance by numerous products Australian Shares fund - 20th anniversary @ 10% pa. “Ethical fund of the Year” - Money Management Magazine “International Fund of the Year” - Australian Funds Management Asso
Slide 19: Strong new business growth
Strong new business growth use only $110 $100 $90 $80 $70 Flows in $ Million $60 $50 For personal $40 $30 $20 $10 Inflows $0 Outflows ($10) ($20) ($30) Jun-13 Jun-14 Jun-15 Mar-13 Sep-13 Dec-13 Mar-14 Sep-14 Dec-14 Mar-15 Sep-15 Dec-15 Mar-16 Managed Funds Super Net Flows 19
Slide 20: Strong financial performance
Strong financial performance Funds Under Management ($m) For personal use only Revenue ($m) 21.2 1,534 19.9 1,402 1,167 15.7 16.4 14.1 14.8 887 13.1 654 669 708 10.9 630 599 2009 2010 2011 2012 2013 2014 2015 Dec 15 FY16 HY Profit After Tax ($m) Dividends (cps) 2.5 200 200 200 2.0 170 147 Special 1.
Slide 21: Half year results
Half year results For personal use only (A$000s unless specified 0therwise) 1H15 1H16 Change Revenue 9,859 10,940 +11% Operating expenses (8,139) (8,358) +3% Non-operating expenses (1,167) (1,081) +7% NPAT 533 1,501 +172% UPAT1 1,423 1,501 +55% Operating cash flow 1,318 (859) n/a Net cash 7,998 10,0
Slide 22: Full year earnings guidance
Full year earnings guidance For personal use only NPAT expected between $3.4m and $3.8m (A$000s unless specified otherwise) FY15 FY16 Change NPAT 1,970 3,657 +86% Add back property revaluation 484 UPAT1 2,454 3,657 +49% Note: 1. Underlying Profit After Tax: excludes items such as restructuring and i
Slide 23: Outstanding shareholder returns
Outstanding shareholder returns For personal use only Key metric Outcome FUM • 15% average increase p.a for the last 10 years Revenue • 12% average increase p.a for the last 10 years EPS • 28% average increase p.a for the last 10 years Dividends • Currently yielding 3.1% p.a., fully franked Paid 200
Slide 24: Summary
Summary For personal use only • Strong growth in ethical investing Macro trends • Long term growth in superannuation • Unique combination of ethics and performance Products • Competitive on fees • Strong in digital direct Sales & marketing • Products available through multiple channels • More stable
Slide 25: Disclaimer
Disclaimer Australian Ethical Investment Ltd (ABN 47 003 188 930; Australian Financial Services Licence No. 229949) is the For personal use only Responsible Entity and Investment Manager of the Australian Ethical Managed Investment Funds. Interests in the Australian Ethical Retail Superannuation Fun
Australian Ethical Investment — AEF Brisbane Investor Conference (May 2016) on 6ix