NAOS Ex-50 Opportunities Co. Ltd. · ASX:NAC
NAOS Ex-50 Opportunities — NAOS Asset Management — Non-Deal Roadshow (September 2020)
34 slides from NAOS Ex-50 Opportunities's roadshow presentation, Sep 24, 2020
Slide 1: Investor Roadshow Webinar
INVESTOR ROADSHOW WEBINAR Thursday 24 September 2020 |11:00 am (AEST) Audio Dial In: +61 2 9087 3602 Guest Access Code: 293-619-181# PRESENTED BY NAOS ASSET MANAGEMENT CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 1
Slide 2: Important information
Important information This material has been prepared by NAOS Asset Management Limited (ABN 23 107 624 126, AFSL 273529) (NAOS) for general information purposes only and must not be construed as investment advice. It does not constitute an offer to purchase any security or financial product or servi
Slide 3: NAOS Asset Management
NAOS Asset Management Our Mission To provide investors with genuine long-term, concentrated exposure to Australian undervalued listed micro, small and mid-cap companies with an industrial focus. NAOS established its first Listed Investment Company (LIC) in 2013 with 400 shareholders, today NAOS mana
Slide 4: NAOS investment beliefs provide a competitive advantage
NAOS investment beliefs provide a competitive advantage Value with Long Quality over Invest for the Term Growth Quantity Long Term 5+ years Performance v Ignore the Pure Exposure Liquidity Focus Index to Industrials The closed end LIC structure removes application and redemption risk. Environmental,
Slide 5: Reasons not to invest with NAOS
Reasons not to invest with NAOS Our LICs are not for everyone. Some reasons why you may not choose to invest with NAOS include: Concentrated portfolios (0-15 investments) Long-term investment philosophy (5+ years) Focus on smaller companies ($20 million - $500 million) Benchmark unaware (No
Slide 6: NAOS investment portfolio financial year returns
NAOS investment portfolio financial year returns* 30% 20% 10% 0% -10% -20% FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 (31/08/20) NAOS Emerging Opportunities Company Limited (ASX: NCC) NAOS Ex-50 Opportunities Company Limited (ASX: NAC) NAOS Small Cap Opportunities Company Limited (ASX: NSC) * Inve
Slide 7: NAOS LIC Fully Franked Dividend History and Profit Reserves
NAOS LIC Fully Franked Dividend History and Profit Reserves Each LIC has consistently paid dividends and holds healthy profit reserves 70.60 70 60 50.00 50 Cents per share (CPS) 39.3 40 32.70 30 27.50 18.60 19.3 20 15.80 13.50 10 0 NCC NAC NSC Total Dividends Declared (Since Inception) Total Gross D
Slide 8: Summary of FY20 Reporting Season
Summary of FY20 Reporting Season On average companies reported better than expected earnings and balance sheet positions with technology, healthcare, consumer and industrial companies faring better than financials (including REIT’s and infrastructure). Government stimulus programs have had a sig
Slide 9: Summary of FY20 Reporting Season (Continued)
Summary of FY20 Reporting Season (Continued) ASX 200 vs S&P 500 130 120 110 Relative Index Level 100 90 80 70 60 Sep-2019 Oct-2019 Nov-2019 Dec-2019 Jan-2020 Feb-2020 Mar-2020 Apr-2020 May-2020 Jun-2020 Jul-2020 Aug-2020 Sep-2020 Source: Bloomberg ASX 200 S&P 500 CONVICTION. LONG TERM. ALIGNED | Cop
Slide 10: Concerns & Opportunities Post Reporting Season
Concerns & Opportunities Post Reporting Season Concerns • Will consumer habits change permanently, or will there be another shift back towards pre- COVID normality? • Government stimulus will reduce from over $100 billion in Q3 CY20 to just $7 billion in Q3 CY21. • How will business manage cash outf
Slide 11: Concerns & Opportunities Post Reporting Season (Continued)
Concerns & Opportunities Post Reporting Season (Continued) ASX 100 vs Aust. Government 10 Year Bonds ASX 100 PE vs Aust. Government 10 Year Bonds 7000 3.5 25 3.5 6000 3 3 20 5000 2.5 2.5 Aust. Govt 10 Yr Bonds Aust. Govt 10 Yr Bonds 15 ASX 100 PE 4000 2 2 ASX 100 3000 1.5 1.5 10 2000 1 1 5 1000 0.5
Slide 12: Opportunities Post Reporting Season
Opportunities Post Reporting Season ASX 200 Earnings Per Share Estimates 430 410 390 370 ASX 200 EPSe 350 330 310 290 270 250 Jan-2020 Feb-2020 Mar-2020 Apr-2020 May-2020 Jun-2020 Jul-2020 Aug-2020 Sep-2020 FY20 EPSe FY21 EPSe FY22 EPSe Source: Bloomberg CONVICTION. LONG TERM. ALIGNED | Copyright 20
Slide 13: Focus on the controllable
Focus on the controllable NAOS will continue to focus on the controllable to maximise risk adjusted returns Can Control Investing with proven management teams based on value/price and stock specific fundamentals on a 3-5-year view Can’t Control Market noise and timing of short-term market movements
Slide 14: Key business & industry traits for maximising long term performance
Key business & industry traits for maximising long term performance and reducing the risk of permanent capital loss events A growing revenue base provides companies with a number of competitive advantages such as the Industry Tailwinds Supporting ability to scale their fixed cost base and increase m
Slide 15: NCC key portfolio events Q1 FY21
NCC key portfolio events Q1 FY21 HOLDING INDUSTRY Q1 UPDATE • Provided a very strong update - trading on a cash flow positive basis in July & August. Tourism • Balance sheet remains in a net cash position. • Most bookings now made directly. (ASX: EXP) • Continue to evaluate several complementary acq
Slide 16: NCC overview as at August 2020
NCC overview as at 31 August 2020 $0.96 7.88% $0.92 9 10.14% 106.54% $72.3m Pre Tax Fully Franked Share Price Number of Performance Performance Weighted NTA* Dividend Yield Holdings since since Inception^ Average Market Inception^ p.a. (Total Return) Capitalisation of the Investments FULLY FRANKED D
Slide 17: NSC key portfolio events Q1 FY21
NSC key portfolio events Q1 FY21 HOLDING INDUSTRY Q1 UPDATE • Announced record FY20 earnings result despite the effects of COVID-19. Communication • Continues to win new tech clients including Atlassian, Zoom & Brightspot. Services • OB Media (an EGG subsidiary) is a leader in the marketing technolo
Slide 18: NSC overview as at August 2020
NSC overview as at 31 August 2020 $0.71 6.90% $0.58 10 -3.77% -10.03% $180.9m Pre Tax Fully Franked Share Price Number of Performance Performance Weighted NTA Dividend Yield Holdings since since Average Market Inception^ p.a. Inception^ Capitalisation of (Total Return) the Investments FULLY FRANKED
Slide 19: NAC key portfolio events Q1 FY21
NAC key portfolio events Q1 FY21 HOLDING INDUSTRY Q1 UPDATE • Produced one of the highest quality results of reporting season with ARR up 22% and operating cash flow 169% of EBITDA. Software & Services • Provided FY21 guidance of “material lift in revenue and profit”. • Will continue to benefit from
Slide 20: NAC overview as at August 2020
NAC overview as at 31 August 2020 $1.20 5.68% $0.925 9 13.77% 111.34% $332.1m Pre Tax Fully Franked Share Price Number of Performance Performance Weighted NTA Dividend Yield Holdings since since Inception^ Average Market Inception^ p.a. (Total Return) Capitalisation of the Investments FULLY FRANKED
Slide 21: Capital Management Initiatives
Capital Management Initiatives Performance Maintain a focus on long term performance without deviating from the NAOS investment philosophy. Dividends Continue to focus on maintaining a growing stream of fully franked dividends whilst maintaining an adequate reserve balance. Alignment Continue to be
Slide 22: Overview and Outlook Q2 FY21
Overview and Outlook Q2 FY21 In our view, a number of core investments have lost a year of progress due to COVID-19, these include BSA Limited (ASX: BSA), BTC Health Ltd (ASX: BTC), Wingara Ag (ASX: WNR) and Consolidated Operations Group (ASX: COG) which has hindered performance. >90% of NAOS in
Slide 23: Q&As
Q&As Thank you for your continued support. “If you own stocks like you’d own a farm or apartment house, you don’t get a quote on those every day or every week.” Warren Buffett CONVICTION. LONG TERM. ALIGNED | Copyright 2020 2019 NAOS Asset Management Limited 23
Slide 24: Appendix
APPENDIX CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 24
Slide 25: NAOS strong long term risk-adjusted returns
NAOS strong long term (5 years+) risk-adjusted returns * NCC Investment Portfolio Risk and Performance Metrics NAC Investment Portfolio Risk and Performance Metrics 15% 15% 13.77% 10.14% 10% 10% 5.56% 5.82% 5% 5% 3.57% 2.84% 2.63% 2.55% 0% 0% -1.28% -1.04% -3.37% -3.14% -5% -5% Performance Since Mon
Slide 26: The benefits of a LIC structure
The benefits of a LIC structure Closed-end structure Long-term Intra-day Liquidity No applications or Investment decisions Trades on the ASX redemptions Corporate Governance Dividends Opportunity Public companies provide Stream of fully franked Trade at discount to assets accountability of Directors
Slide 27: NAOS Listed Investment Companies
NAOS Listed Investment Companies Each of our LICs target a concentrated portfolio of 0-20 companies CONVICTION. LONG TERM. ALIGNED | Copyright 2020 2019 NAOS Asset Management Limited 27
Slide 28: NAOS management alignment
NAOS management alignment NAOS Director’s shareholdings have significantly increased since the inception of each LIC Inception Directors Shareholding (Ordinary Shares) 24 September 2020 Directors Shareholding (Ordinary Shares) 9,000,000 8,037,436 8,000,000 7,000,000 6,000,000 5,000,000 4,289,990 4,0
Slide 29: NAOS investment process
NAOS investment process CONVICTION. LONG TERM. ALIGNED | Copyright 2020 2019 NAOS Asset Management Limited 29
Slide 30: NAOS ESG framework
NAOS ESG framework CONVICTION. LONG TERM. ALIGNED | Copyright 2020 2019 NAOS Asset Management Limited 30
Slide 31: Historical shareholder numbers
Feb-13 Apr-13 Jun-13 Aug-13 Oct-13 Dec-13 Feb-14 Apr-14 Jun-14 Aug-14 Oct-14 Dec-14 CONVICTION. LONG TERM. ALIGNED | Copyright 2020 Feb-15 Apr-15 Jun-15 Aug-15 Oct-15 Dec-15 Feb-16 2019 NAOS Asset Management Limited NCC Shareholders Apr-16 Jun-16 Aug-16 Oct-16 Dec-16 Historical shareholder numbers F
Slide 32: Investor awareness and communication
Investor awareness and communication CEO Insights, NAOS Shareholder Monthly Investment The news and media Quarterly Webinars Newsletter, Conference Report & NTA email section of our website subscribe via our Calls/Webinars updates, subscribe via is updated regularly website subscribe via our our web
Slide 33: NAOS Asset Management giving back
NAOS Asset Management giving back NAOS, the management company, is proud to be supporting the following charities. Since 2018 NAOS has donated a total of $90,000 to the following charities. ‘Golden Shouldered Parrot’ threatened ‘Reef Aid’ campaign, in partnership RFDS, dedicated to providing species
Slide 34: NAOS Directors and Team
NAOS Directors and Team OUR DIRECTORS Sebastian Evans Warwick Evans Matthew Hyder David Rickards Sarah Williams Mark Bennett Trevor Carroll Managing Director, NAOS Chairman, NAOS Asset Director, NAOS Asset Independent Chairman & Independent Director, Director, NAOS Asset Independent Chairman Asset M
NAOS Asset Management — Non-Deal Roadshow (September 2020) on 6ix