Polar Capital Technology Trust PLC · LSE:PCT
Polar Capital Technology Trust — Shareholder Meeting (July 2009)
29 slides from Polar Capital Technology Trust's shareholder meeting presentation, Jul 29, 2009
Slide 1: Polar Capital Technology Trust plc AGM
POLAR CAPITAL Polar Capital Technology Trust plc AGM 29th July 2009 This presentation is for non US investors only
Slide 2: Results
R Results lt 2 POLAR CAPITAL
Slide 3: Results Y/E 30 April 2009
Polar Capital Technology Trust Results Y/E 30 April 2009 Net Assets £274.2m NAV per share - 4.4% Benchmark - 5.5% FTSE World - 18.2% Technology Performance Index Performance Source: Polar Capital, Bloomberg Source: Polar Capital, Bloomberg 3 POLAR CAPITAL Please refer to the important information at
Slide 4: Credit crisis / recession drives equities sharply lower
2008-9 • Credit crisis / recession drives equities sharply lower • Tech sector delivers best relative returns since FY2000 • Favourable FX further ameliorates Sterling returns • Improved FY relative performance • p Recent outperformance captures p cyclical y attributes… • …but secular story remains
Slide 5: Outlook
O tl k Outlook 5 POLAR CAPITAL
Slide 6: Macroeconomic view
Macroeconomic view Stabilisation but below trend global GDP growth • Sharp global economic slowdown but encouraging signs of stabilisation • Unprecedented policy response averted worst-case worst case scenario • Systematic risk largely eliminated • Accommodative monetary policy likely to endure • In
Slide 7: Tech leadership likely to persist: relative sector performance
Tech leadership likely to persist Relative sector performance Dow Jones World Tech versus FTSE World Index (2001 - Present) Source: Bloomberg, 3/7/09 7 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 8: Tech leadership likely to persist: limited participation
Tech leadership likely to persist Limited participation during prior cycle • ‘Bubble’ excesses needed to be worked off • Relative P/E compression outweighed superior earnings growth • Over-capitalised p balance sheets dragged gg on returns • Excess capacity resulted in muted enterprise capital spend
Slide 9: Tech leadership likely to persist: superior earnings profile
Tech leadership likely to persist Superior earnings profile Prospective EPS relative to S&P 500 (1995 – Present) Source: Bank of America Securities, IBES, S&P, as at 2/6/09 9 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 10: Undemanding valuations – Forward P/E
Tech leadership likely to persist Undemanding valuations – Forward P/E S&P Information Technology, Forward P/E (1992 – Present) Source: Ned Davis Research, as at 10/7/09 10 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 11: Undemanding valuations – Relative Forward P/E
Tech leadership likely to persist Undemanding valuations – Relative Forward P/E S&P Information Technology, Relative Forward P/E (1992 – Present) Source: Ned Davis Research, as at 10/7/09 11 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 12: Muted IT spending cycle
Tech leadership likely to persist Muted IT spending cycle US Technology Spending, % of total non-residential investment (1959 – 2009) Source: Credit Suisse 12 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 13: Structural under-ownership
Tech leadership likely to persist Structural under-ownership ETF and other Tech assets as % of total domestic sector assets (1990 – Present) Source: Ned Davis Research, as at 15/7/09 13 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 14: Key Themes
K Themes Key Th 14 POLAR CAPITAL
Slide 15: 'Distributed computing' = kernel of the new cycle
‘Distributed computing’ = kernel of the new cycle Distributed computing environment Legacy • Bandwidth expensive = Local Area Networks (LAN) • Result = massive duplication of IT assets Now • Plentiful & cheap bandwidth / broadband ubiquity Source: Polar Capital Partners • Hardware costs eclipsed by
Slide 16: Internet-enabled applications expand the market
Internet-enabled applications expand the market Average IT spending per Enterprise ($000) Legacy • Understandable focus on large enterprise market • Upfront costs / IT expertise = barrier to adoption • Consultancy / implementation = real cost of deployment Now *Source: IDC • Internet delivery mechan
Slide 17: Mobile broadband driving ubiquitous computing
Mobile broadband driving ubiquitous computing Smartphone shipments / share (Q401 – Q408) Legacy • PC’s dominated computing limiting addressable market • Broadband limited to fixed line networks Now • Broadband available across WiFi / Cellular networks Source: IDC, Needham • Proliferation of converge
Slide 18: Additional investment themes
Additional investment themes Drivers: energy prices g ‘green’ agenda g Focus Areas: solar Drivers: wind ALTERNATIVE resource shortage ENERGY ‘green’ agenda Drivers: Focus Areas: demographics LED lighting expanded TAM GAMES filtration CONSOLES CONSERVATION Focus Areas: desalination product d t cycles
Slide 19: It's all about earnings growth
It’s all about earnings growth Core Growth Defensive Growth Rev growth Rev growth EPS growth Rev growth Rev growth EPS growth (last twelve (forward 12 (forward 12 (last twelve (forward 12 (forward 12 months) months est) month est) months) months est) month est) 40%* 20% 10% 8% 8% 9% 27% 19% 2% 9% 6%
Slide 20: It's all about earnings growth: Aggressive Growth
It’s all about earnings growth Aggressive Growth Rev growth Rev growth EPS growth Rev growth Rev growth EPS growth (last twelve (forward 12- (forward 12- (last twelve (forward 12- (forward 12- months) month est.) month est.) months) month est.) month est.) 133% 71% 59% 25% 25% 127% 65% 45% nm 55% 23
Slide 21: Current Positioning
C Current tPPositioning iti i 21 POLAR CAPITAL
Slide 22: Current Positioning
Current Positioning As at 30th June 2009 Top 10 Holdings Geographic allocation Source: Polar Capital Partners Source: Polar Capital Partners 22 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 23: Portfolio Analysis
Portfolio Analysis As at 29th May 2009 Market Cap splits, 4/08 – 5/09 Splits by style, % of PCT Source: Polar Capital, as at end May 2009 Top 10 holdings as % of PCT, 4/08 – 5/09 Source: Polar Capital, as at 10/6/09 Source: Polar Capital, as at end May 2009 23 POLAR CAPITAL Please refer to the impor
Slide 24: New cycles are bad for incumbents
New cycles are bad for incumbents US technology sector (weighted) 1969 - Present US technology sector (un-weighted) 1969 - Present Source: Piper Jaffray, March 2009 Source: Piper Jaffray, March 2009 24 POLAR CAPITAL Please refer to the important information at the end of this presentation
Slide 25: Conclusion
Conclusion • Limited sector participation during previous cycle creates ideal ‘set-up’ • Despite meaningful recent outperformance, we expect leadership to persist • Relative valuations remain undemanding before balance sheets considered • Sector should deliver secular growth against a backdrop of be
Slide 26: Important Information
Polar Capital Partners Limited Four Matthew Parker Street London SW1H 9NP House View This document has been produced based on Polar Capital research and analysis and represents our house view. All sources are Polar Capital unless otherwise stated. Important Information The information provided in th
Slide 27: Regulatory Status
Polar Capital Partners Limited Four Matthew Parker Street London SW1H 9NP Regulatory Status This document is Issued in the UK by Polar Capital. Polar Capital LLP is a limited liability partnership number OC314700. It is authorised and regulated by the Financial Services Authority. A list of members
Slide 28: Polar Capital Technology Trust plc AGM
POLAR CAPITAL Polar Capital Technology Trust plc AGM 29th July 2009 This presentation is for non US investors only
Slide 29: Annual General Meeting – Proxy Votes
Polar Capital Technology Trust plc Annual General Meeting Meeting, 29 July 2009 – Proxy Votes TOTAL VOTES 48,231,809 29 POLAR CAPITAL
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