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Omni Bridgeway — IMF Bentham — FY2019 Earnings Presentation
31 slides from Omni Bridgeway's earnings presentation, August 2019
Slide 1: FY2019 Full Year Results
FY2019 Full Year Results August 2019 Investor Presentation This presentation is for the use of IMF Bentham’s public shareholders and is not an offering of any IMF Bentham private fund.
Slide 2: FY 2019 Summary
FY 2019 SUMMARY WHAT WORKED: WHAT DIDN’T: Progressed Funds Management: Deferred completion of a number of significant investments RoW Funds 2 & 3 upsized from $150m to $180m Modest returns on some case completions Fund 4 with USD500m of commitments to US investments, with The loss of two U
Slide 3: Post 30 June 2019 Performance
POST 30 JUNE 2019 PERFORMANCE Balance sheet Fund 1 Funds 2&3 Fund 4 TOTAL direct (USA) (RoW) (USA) (Global) $ million $ million $ million $ million $ million Income recognised at 30 June 2019 Completed investments 16.90 15.59 0.33 - 32.82 Ongoing investments 0.20 2.00 - - 2.20 17.10 17.59 0.33 - 35.
Slide 4: Agenda
AGENDA 1. Background to IMF 2. Financial Results FY19 3. Portfolio 4. Funds Management 5. Future Plans 6. Risks and Disclaimers 4
Slide 5: Overview of IMF Bentham Limited at 30 June 2019
OVERVIEW OF IMF BENTHAM LIMITED AT 30 JUNE 2019 1. Includes investments approved by the Investment Committee, funded and conditionally funded. 5
Slide 6: Agenda
AGENDA 1. Background to IMF 2. Financial Results FY19 3. Portfolio 4. Funds Management 5. Future Plans 6. Risks and Disclaimers 6
Slide 7: Financial Results Overview
FINANCIAL RESULTS OVERVIEW FY2019 v FY2019 FY2018 FY2018 Contract income $35.0M $71.2M ▼51% Litigation expenses $(39.2)M $(54.9)M ▼29% Net Income from investments $(4.2)M $16.3M ▼126% Other income (foreign exchange & interest) $10.0M $6.8M ▲46% Net operating expenses $(53.5)M $(31.5)M ▲70% Net loss
Slide 8: Cash v IFRS
CASH v IFRS FY 2019 FY 2018 $ 000 $ 000 Cash inflows from operating activities Proceeds from litigation funding - settlements, fees and reimbursements 43,179 94,893 Cash outflows from operating activities Payments to suppliers and employees (35,625) (44,316) Income tax paid 3,459 (13,231) Net intere
Slide 9: Balance Sheet Strength
BALANCE SHEET STRENGTH Cash Net Assets ($ Million) ($ Million) 250.0 600.00 226.5 5.6 515.5 200.0 38.3 500.00 160.2 400.00 49.7 144.9 367.8 296.6 150.0 15.9 5.5 10.1 142.5 139.4 300.00 134.2 132.8 175.4 130.1 100.0 206.3 200.00 2.4 218.94 203.93 201.40 50.0 192.40 185.90 100.00 - 2015 2016 2017 2018
Slide 10: Balance Sheet Strength cont'd
BALANCE SHEET STRENGTH cont’d Investments 1 Portfolio 9,000 450.0 ($ Million) ($ Million) 427.0 7.957 28.6 8,000 400.0 569 37.6 350.0 7,000 321.3 2,709 9.1 Total 300.0 6,000 Funds 206.7 1,313 Total 250.0 272.8m 5,000 189.6 Funds 200.0 190.9 6,442m 10.3 4,000 3,379 403 3,164 150.0 2,700 180.6 3,000 1
Slide 11: IMF's Track Record
IMF’s TRACK RECORD A$2.4b 2.6 years 89% $897m total recoveries average duration success rate IMF’s revenue A$1.5b 83 192 134% ROIC returns for funded active investments funded 2.3x MOIC claimants investments to completion 38% A$2.4b $897m total recoveries IMF’s revenue 62% $383m 134% ROIC cost – inv
Slide 12: IMF's ROIC Track Record
IMF’s ROIC TRACK RECORD ROIC 165% 163% 153% 156% 154% 160% 159% 151% 147% 134% 124% 121% 118% 84% 47% FY2015 FY2016 FY2017 FY2018 FY2019 US Non-US Group 89% success rate on number of investments at 30 June 2019. Average duration has remained consistent since FY2014 at approximately 2.6 years.
Slide 13: Recent Completions by Region
RECENT COMPLETIONS BY REGION Recent Completions by Region Number of Average Success rate Success rate ROIC IRR IRR (excluding withdrawals and Investments Investment on number of on $ weighted (excluding (including average including losses and adverse costs) Length investments overhead) overhead) IMF
Slide 14: Funding Funnel
FUNDING FUNNEL FUNDING APPLICATIONS ACTUAL AND BUDGETED FUNDING COMMITMENTS1 1200 1000 974 300 45 866 800 827 Number of 40 250 Investment Managers 35 Funds Committed (A$m) 669 200 (RHS) 30 600 510 534 482 25 446 440 150 400 20 368 345 356 276 301 100 15 200 170 10 50 5 0 FY15 FY16 FY17 FY18 FY19 - 0
Slide 15: Agenda
AGENDA 1. Background to IMF 2. Financial Results FY19 3. Portfolio 4. Funds Management 5. Future Plans 6. Risks and Disclaimers 15
Slide 16: Investment Portfolio at 30 June 2019
INVESTMENT PORTFOLIO AT 30 JUNE 2019 Number of Investments in Portfolio EPV of Investments in Portfolio ($m) 90 9,000 80 8,000 70 7,000 60 6,000 50 5,000 40 4,000 30 3,000 20 2,000 10 1,000 0 0 30 June 2016 30 June 2017 30 June 2018 30 June 2019 30 June 2016 30 June 2017 30 June 2018 30 June 2019 To
Slide 17: The Two "Ws"
THE TWO “Ws” Over the past three and a half years IMF has focused on transitioning away from idiosyncratic risk to systemic risk of a portfolio, which has been reflected in the increased number of investments, across a broader range of case types, sizes and jurisdictions. There remain two materi
Slide 18: Investment Portfolio at 30 June 2019
INVESTMENT PORTFOLIO AT 30 JUNE 2019 See notes to Investment Portfolio at 30 June 2019 (Slide 20) for further details EPV Number of Possible Completion EPV $m $m investments FY2020 FY2021 FY2022 FY2023+ IMF balance sheet 1,514.2 21 1,074.2 290.0 150.0 0.0 Fund 1 3,164.3 34 1,470.8 1,201.1 255.9 236.
Slide 19: Diversification by Type and Geography
DIVERSIFICATION BY TYPE AND GEOGRAPHY EPV by Investment Type* EPV by Geography* Diversification of investment type and across geographies in the global portfolio. Opportunistic investor so no hard rules on investment blend in the portfolio. Funds have size caps on individual investments depend
Slide 20: Notes to Investment Portfolio at 30 June 2019
NOTES TO INVESTMENT PORTFOLIO AT 30 JUNE 2019 Notes to the Group’s Investment Portfolio Investments Included in Portfolio EPV for an investment where the IMF funding entity earns a funding commission The Investment Portfolio includes investments for which the IMF Group have calculated as a multiple
Slide 21: Agenda
AGENDA 1. Background to IMF 2. Financial Results FY19 3. Portfolio 4. Funds Management 5. Future Plans 6. Risks and Disclaimers 21
Slide 22: Completions by Fund
COMPLETIONS BY FUND Average Success rate on IRR Number of Fund Investment number of ROIC (excluding Investments length investments overhead) US Fund 1 15 2.3 years 73% -0.11x -9% US Fund 1 – including conditional 16 2.2 years 75% 0.14x 6% completion post 30 June 2019 Rest of World Funds 2 & 3 4 0.5
Slide 23: Fund 1 – Commitments, Deployed, Capacity
FUND 1 – COMMITMENTS, DEPLOYED, CAPACITY As at 30 June 2019, Fund 1 had committed capital 96.2% of its available capacity to investments. The remaining USD 6.3 million will be committed to pipeline investments. Accumulated Accumulated Accumulated Capital Called Uncalled Capital Preferred Special
Slide 24: Funds 2 & 3 – Commitments, Deployed, Capacity
FUNDS 2 & 3 – COMMITMENTS, DEPLOYED, CAPACITY RoW Funds commenced in October 2017, and is ahead of schedule in terms of commitments. The contribution from non-Australian investments is ahead of schedule and revised geographic limitations have been agreed to reflect this outcome. Accumulated Accu
Slide 25: Fund 4 – Commitments, Deployed, Capacity
FUND 4 – COMMITMENTS, DEPLOYED, CAPACITY Fund 4 closed in December 2018 with the first investments funded in April 2019 with the end of Fund 1’s exclusivity. Capital Called Uncalled Capital $m $m Total Investors IMF Total Investors IMF 23.0 18.4 4.6 477.0 381.6 95.4 25
Slide 26: Agenda
AGENDA 1. Background to IMF 2. Financial Results FY19 3. Portfolio 4. Funds Management 5. Future Plans 6. Risks and Disclaimers 26
Slide 27: The Future
THE FUTURE Growth opportunities Financing solvent corporates across all jurisdictions Strong pipelines in all jurisdictions Increase in number of Investment Managers Coordination across global network Ongoing Risk Mitigation Continued diversification of operations Adverse cost insurance
Slide 28: Agenda
AGENDA 1. Background to IMF 2. Financial Results FY19 3. Portfolio 4. Funds Management 5. Future Plans 6. Risks and Disclaimers 28
Slide 29: Risk Mitigation
RISK MITIGATION Risk Potential Impact Strategic Response Portfolio Concentration Potential for a funded case to be lost = IMF investment lost and Deliberate transition from idiosyncratic risk to systemic risk of a portfolio exposure to adverse costs Portfolio represents increased number of inves
Slide 30: Disclaimer
DISCLAIMER The material in this presentation has been prepared by IMF Bentham Limited (IMF) and is general background information about IMF's activities. The information is given in summary form and does not purport to be complete. A number of terms used in this presentation including; ROIC, EPV
Slide 31: www.imf.com.au info@imf.com.au
www.imf.com.au info@imf.com.au 1800 016 464