Aberdeen Group Plc · LSE:ABDN
Aberdeen — H1 2019 Earnings Presentation
36 slides from Aberdeen's earnings presentation, Aug 7, 2019
Slide 1: Building on our resilience
Building on our resilience Half year results 2019 Standard Life Aberdeen plc 7 August 2019
Slide 2: Building on our resilience
Building on our resilience Attracting assets Financial discipline Improvement in investment performance Continued to reduce costs Four new consultant rated strategies bringing total to 46 Transformation on track Resilient gross inflows and improvement in net outflows Building best-in-class infrastru
Slide 3: Financial update
Financial update Stephanie Bruce, Chief Financial Officer
Slide 4: Financial highlights
Financial highlights H1 2018 H2 2018 H1 2019 Assets under management and administration (£bn) 592.1 551.5 577.5 Gross inflows (£bn) 37.4 37.8 36.5 Net flows (£bn) (16.9) (24.0) (15.9) Adjusted profit before tax (£m) 311 339 280 Adjusted diluted earnings per share1 (p) 8.2 9.6 8.9 IFRS profit after t
Slide 5: Wrap, Elevate and Parmenion AUMA
Resilient AUMA benefiting from continued growth in our platforms and market performance £700bn £70bn £66.0bn +11% Parmenion £608.1bn £577.5bn £6.2bn £592.1bn £58.4bn1 £59.4bn1 +5% Wrap, Elevate and Parmenion AUMA £551.5bn £47.2bn1 Total AUMA Acquisitions £13.2bn Platforms – 2017 2017 Wrap and Elevat
Slide 6: AUMA gross inflows
Gross inflows fuelled by demand for our wider Institutional and Wholesale product suite £40bn £37.4bn £37.8bn Institutional and Wholesale gross inflows up compared to £36.5bn £34.5bn H2 2018 despite lower demand for equities and absolute return. Improved momentum across a broad range of propositions
Slide 7: AUMA net flows
Net outflows reduced – remain concentrated in a few strategies and insurance client books in natural run-off £5bn £1.2bn £4.4bn Improved momentum across a broad range of £0.1bn £0bn (£1.1bn) propositions including cash/liquidity and quantitative (£5.6bn) (£3.9bn) (£5.7bn) investment solutions. Lower
Slide 8: Adjusted profit before tax from continuing operations
Adjusted profit before tax from continuing operations H1 2018 H1 2019 £m £m Profitability: Total fee revenue Fee based revenue 966 815 margin of 28.0bps Adjusted operating expenses (712) (673) (H1 2018: 31.5bps) Adjusted operating profit 254 142 largely driven by Capital management (3) 22 mix effect
Slide 9: Operating expenses
Ongoing focus on financial discipline H1 2018 H1 2019 £750m £135m £234m Actions or 39% or 67% £712m (£63m) taken £350m (End 2020) £40m £28m (£17m) run-rate Operating expenses H2 2018 £673m £175m £13m £103m or 50% Efficiency Efficiency benefit benefit H1 2018 H1 2019 £40m £103m H1 2018 H1 2019 Benefi
Slide 10: Surplus regulatory capital
Strong capital position and balance sheet supports ongoing investment and dividend policy £1.5bn £2.5bn £2.0bn Surplus regulatory capital £1.7bn £0.1bn £0.9bn Surplus Surplus £0.9bn Capital £0.45bn Buyback CET1 £200m £0.6bn CET1 £1.4bn £0.6bn (£0.2bn) £1.1bn CET1 £1.1bn £1.1bn £1.1bn (£0.05bn) £1.1b
Slide 11: Interim dividend unchanged
Interim dividend unchanged Strong balance sheet 2018 2019 Interim dividend per share (p) 7.3 7.3 Surplus Net liquid Distributable Final dividend per share (p) 14.3 N/A regulatory capital resources2 reserves Total dividend per share (p) 21.6 N/A £0.9bn £1.1bn £0.9bn (excludes H1 2019 profit) Cost of
Slide 12: Positioning our business for long-term growth
Positioning our business for long-term growth Keith Skeoch, Chief Executive Officer
Slide 13: Our vision – a world-class investment company
Our vision – a world-class investment company Global Diversified Close to clients Strong balance sheet Shareholder value With scale across Diversified by Investment partner of Source of resilience Leading levels of geographies, product, geography choice for efficiency and channels, support and chann
Slide 14: Encouraging investment performance with marked improvement in key strategies
Encouraging investment performance with marked improvement in key strategies 10% AUM above benchmark 1 year performance vs benchmark 1 YR 1 YR 47% 53% 0% 3 YRS 3 YRS 50% 65% FY 2018 H1 2019 -15% Improved performance across both equities and absolute H1 2018 H1 2019 return driven by process enhanceme
Slide 15: Significant market opportunities for growth
Significant market opportunities for growth Alternatives Solutions Active Specialities Passive Private Markets1 Real Estate1 Multi-asset1 Insurance clients Active Equities Active FI Quantitative/ Rules-based investing1 £29bn £40bn £72bn £270bn £73bn £48bn £73bn • Top 10 globally in private • Top ret
Slide 16: As well as the drive and focus to accelerate growth
As well as the drive and focus to accelerate growth Alternatives Solutions Active Specialities Passive • Expanding real estate • Extending the MyFolio range • Enhancing our investment • Providing low cost beta and capabilities into Asia (Orion into Index and Separately process to improve equity smar
Slide 17: Access to customers
Access to customers IFAs Connecting to Global direct distribution 10 million customers Standard Life – one of UK’s Working with over 5,000 6 million customers customers capability across Institutional strongest savings brands firms across the UK serving and Wholesale 460k customers £6bn £6bn1 £60bn
Slide 18: Valuable listed investments of £5.2bn
Valuable listed investments of £5.2bn Stake: 19.98% Stake: 29.9% Stake: 23.0% Listed value of stake: £0.9bn1 Listed value of stake: £1.5bn1 Listed value of stake: £2.8bn1 Strategic investment: source of Strategic investment: no. 1 asset Investment: non-strategic following earnings and dividends, as
Slide 19: Strong business well positioned for long-term growth
Strong business well positioned for long-term growth • Well positioned for themes shaping our industry • Financial strength to invest in innovation, technology and our people • Strong balance sheet with substantial listed investments and net cash resources • Final £200m phase of the £1.75bn capital
Slide 20: Questions
Standard lite Abate = Questions
Slide 21: Forward-looking statements
Forward-looking statements This presentation may contain certain “forward-looking statements” with respect to the financial condition, performance, results, strategy, objectives, plans, goals and expectations of Standard Life Aberdeen plc (“Standard Life Aberdeen”) and its affiliates. These forward-
Slide 22: Appendix
Appendix
Slide 23: Analysis of profit by segment
Analysis of profit by segment Asset Insurance Total Discontinued management associates and continuing Eliminations Total operations and platforms joint ventures operations H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 H1 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 2018 2019 £m £m £m £m £m £m £m £m £m £m £m
Slide 24: Adjusting items benefiting from gain on sale of HDFC Life
Adjusting items benefiting from gain on sale of HDFC Life and reversal of previously made impairment of Phoenix H1 2018 H2 2018 H1 2019 £m £m £m Restructuring and corporate transaction expenses (59) (180) (198) Amortisation and impairment of intangible assets acquired in business (108) (1,047) (144)
Slide 25: Assets, flows and fee revenue yield
Assets, flows and fee revenue yield Fee revenue Gross inflows Net flows AUMA Fee based revenue yield1 H1 H2 H1 H1 H2 H1 H1 H2 H1 H1 H2 H1 H1 H2 H1 2018 2018 2019 2018 2018 2019 2018 2018 2019 2018 2018 2019 2018 2018 2019 £bn £bn £bn £bn £bn £bn £bn £bn £bn £m £m £m bps bps bps Equities 7.1 4.7 4.3
Slide 26: Analysis of movement in AUMA by channel
Analysis of movement in AUMA by channel Market/Other Opening AUMA Gross inflows Redemptions Net flows movements Corporate actions Closing AUMA H1 H2 H1 H1 H2 H1 H1 H2 H1 H1 H2 H1 H1 H2 H1 H1 H2 H1 H1 H2 H1 2018 2018 2019 2018 2018 2019 2018 2018 2019 2018 2018 2019 2018 2018 2019 2018 2018 2019 2018
Slide 27: Detailed asset class analysis
Detailed asset class analysis Opening AUM as at Gross Market and Corporate Closing AUM as at 1 Jan 2019 inflows Redemptions Net flows other movements actions 30 Jun 2019 £bn £bn £bn £bn £bn £bn £bn Developed markets equities 12.9 1.0 (2.0) (1.0) 2.2 - 14.1 Emerging markets equities 25.0 1.0 (5.9) (4
Slide 28: Significant market opportunities for growth
Significant market opportunities for growth Alternatives1 Solutions1 Active Specialities1 Passive1 $163bn Revenue +$46bn +$9tn $117bn $25tn +$5tn +$7tn +$5tn $20tn $18tn $17tn $16tn $15tn $73bn Revenue $12tn $55bn +$18bn $11tn $47bn Revenue +$20bn $28bn Revenue $27bn $17bn +$11bn 2017 2022 2017 2022
Slide 29: Sustained growth across our platforms – Wrap, Elevate and Parmenion
Sustained growth across our platforms – Wrap, Elevate and Parmenion £70bn £66.0bn +11% H1 2018 H2 2018 H1 2019 Parmenion £6.2bn £m £m £m £58.4bn1 £59.4bn1 Wrap, Elevate and Parmenion AUMA £47.2bn1 Fee based revenue 79 81 83 Acquisitions £13.2bn Adjusted operating expenses (65) (71) (71) Platforms –
Slide 30: ESG factors embedded into all investment decisions
ESG factors embedded into all investment decisions Enhancing the value of active management to invest for a better future Long-established track record in ESG to capitalise on its growing Winning new mandates across asset classes and the world importance to institutional and retail investors • Activ
Slide 31: Successful settlement of arbitration with Lloyds Banking Group
Successful settlement of arbitration with Lloyds Banking Group LBG / Scottish Widows Retaining Scottish Widows as an important client with £35bn of AUM in strategically important asset classes, assets under management including: • £30bn in passive strategies • £5bn in real estate Expect revenues of
Slide 32: Insurance associates and joint ventures adjusted profit before tax
Insurance associates and joint ventures adjusted profit before tax Ownership at H1 2018 H1 2019 30 Jun 19 £m £m HDFC Life 23.02% 24 24 Heng An SL 50.00% 10 13 Phoenix Group (from 1 Sept 2018) 19.98% - 53 Adjusted profit before tax 34 90 • Stable profit from HDFC Life reflects strong premium growth o
Slide 33: HDFC Life – a leading private Indian life insurer
HDFC Life – a leading private Indian life insurer A fast growing business leveraging one of India’s most valuable brands1 Consistently ranked in top 3 private life insurers in India2 77% increase in share price since IPO in November 2017 INR300bn 25% INR550 R292bn R512 Share of private life insuranc
Slide 34: HDFC AMC – India's leading asset manager
HDFC AMC – India’s leading asset manager A fast growing business leveraging one of India’s most valuable brands1 AUM of £38.1bn with CAGR of 26% over the last 5 years2 89% increase in share price since IPO in August 2018 INR3,500bn INR2,500 R3,439bn R2,078 Assets under management3 R2,920bn R2,306bn
Slide 35: List of notes
List of notes Slide 3 1. In accordance with IAS 33, earnings per share have not been restated following the share consolidation in 2018 as there was an overall corresponding change in resources. As a result of the share consolidation and share buyback, earnings per share from continuing operations f
Slide 36: Standard Life Aberdeen plc is registered in Scotland (SC286832) at 1 George Street, Edinburgh,
Standard Life Aberdeen plc is registered in Scotland (SC286832) at 1 George Street, Edinburgh, EH2 2LL. www.standardlifeaberdeen.com © 2019 Standard Life Aberdeen. All rights reserved.