Old Mutual Ltd. · JSE:OMU
Old Mutual — Old Mutual South Africa — UBS Conference 2007, Cape Town
21 slides from Old Mutual's conference presentation, Oct 16, 2007
Slide 1: Old Mutual South Africa: Delivering high returns and growth
Old Mutual South Africa Delivering high returns and growth Paul Hanratty, MD 16 October 2007
Slide 2: Disclaimer
Disclaimer This presentation may contain certain forward looking statements with respect to certain of Old Mutual plc’s plans and its current goals and expectations relating to its future financial condition, performance and results. By their nature, all forward looking statements involve risk and u
Slide 3: Building a premier international savings & wealth management group
Building a premier international savings & wealth management group Asset Management is the core of Old Mutual We have consistently produced excellent investment performance We have a leading position in open architecture platforms in the UK – Powerful brand franchises in South Africa and Swede
Slide 4: Growing funds under management, internationally
Growing funds under management, internationally FUM 30 Jun 2007 £263bn RoW 3% FUM 31 Dec 2001 £143bn SA Europe 16% SA 22% FUM 31 Dec 1999 RoW 10%SA 32% RoW 10% £45bn 23% US 59% RoW US US 40% SA 68%67% 60% FUM 31 Dec 2008 £300bn 4
Slide 5: Asset management business model
Asset management business model Simple business model – (Assets x Margin) – Expenses = Pre tax profit – Pre tax profit averages 50 - 55bps – £15 billion assets = 1p EPS Target margins are structured to deliver 15% Group RoE Net client cash flow has been double industry average – FY’05: £13bn (
Slide 6: Old Mutual South Africa – developing from a traditional life insurer to a premier wealth manager
Old Mutual South Africa – developing from a traditional life insurer to a premier wealth manager Asset management is the core part of our business We have powerful distribution and a great brand to collect assets – and we will keep growing the distribution We have a powerful cash engine in our
Slide 7: Multi boutique asset management model – similar to US
Multi boutique asset management model – similar to US 7
Slide 8: Boutique model drives investment performance
Boutique model drives investment performance Boutique – Focus on investment process • Stay true to style/class – Management focus on service of clients – Alignment with shareholders through profit share pools – Alignment with clients through co-investment and performance fee structures Central m
Slide 9: Our multi-manager boutique – Symmetry
Our multi-manager boutique – SYm mETRY R25bn funds under management – Own money invested alongside client funds 1st Multi-manager to win a Raging Bull award against single managers 7 S&P Awards against single managers Symmetry Absolute Return - 3 yr returns > CPIX + 7% … and no negative return
Slide 10: Specialist equity boutiques
Specialist equity boutiques Select Equity Boutique General Equity UT category Top 10 at 31.08.07 – Raging Bull awards for periods to December 2004, 2005 & 2006 – S&P Awards for periods to December 2005 & 2006 – Chosen to limit capacity to R24bn and 25 clients maximum to preserve focus and quality
Slide 11: Our investment performance is excellent
Our investment performance is excellent Alexander Forbes Global Manager Watch – OMIGSA Pinnacle Fund ranking 12 Months 3 Years 5 Years 30.6% 33.8% 26.3% 30.0% 32.9% 25.2% 28.4% 27.4% 32.0% 24.0% 26.9% 31.2% 23.8% 26.5% 30.6% 23.7% 26.3% 26.1% 22.9% 29.9% 25.6% 29.5% 22.5% 25.4% 24.5% 29.4% 22.1% 0%
Slide 12: Retail & institutional investors can choose from top performing funds across the risk spectrum
Retail & institutional investors can choose from top performing funds across the risk spectrum 12
Slide 13: Boutiques are creating value in our traditional book
Boutiques are creating value in our traditional book Aggressive move to core / satellite – Large portfolios can be managed with the nimbleness associated with smaller portfolios – Absolute Growth Fund solution using traditional smoothed bonus concept plus multi boutique asset managment Performan
Slide 14: Demographics in South Africa
Demographics in South Africa Baby boomers SA 2005 vs 2025 – In decumulation phase and will make up a larger percentage of the 6000 Dissavers Savers Decumulators population in years to come 5000 Buppies Population (000's) – Spend currently valued in excess of 4000 R180 billion per annum – low sav
Slide 15: Growth in savings
Growth in savings Driven by market effects rather than new flows Sharp increase in flows into non-traditional assets Existing pools for baby boomers – Boutiques create competitive advantage Rise of the mass retail market – first insurance – distribution creates competitive advantage 15
Slide 16: A x M – E = P/C = ROC: 2006 Results
A x M – E = P/C = ROC 2006 Results Rm New Era Traditional Total FUM (2006 ave) 199,135 216,165 415,300 Profit before Tax (excl LTIR) 701 3,251 3,952 Net margin before tax 35 bps 150 bps 95 bps Profit after Tax (excl LTIR) 474 2,198 2,672 Profit after tax /FUM 24 bps 102 bps 64 bps Average Capital (O
Slide 17: Financial Targets
Financial Targets Key Financial Metrics 2007 / 9 2010 & beyond RoC >20% >20% New Era 16%-20% >20% Traditional >20% >20% NCCF +2.5% > +2.5% Maintenance cost (R per policy per month) Retail Mass 13.09 n/a Retail Affluent 13.89 17
Slide 18: OMSA's role in OM Group
OMSA’s role in OM Group Highly profitable, with excellent ROE Low NCCF growth in medium term Platform for growth Excellent ROE growth in new era 18
Slide 19: Questions?
19 a UBS Questions ? §2) OLD MUTUAL
Slide 20: Appendix
Appendix 2 += a UBS §2) OLD MUTUAL
Slide 21: Specialist equity boutique – Select Equity
Specialist equity boutique – Select Equity Manages unconstrained equity only mandates Outstanding team committed to performance – Awards: Raging Bulls for periods to December 2004, 2005 & 2006; S&P Awards for periods to December 2005 & 2006 – Chosen to limit capacity to R24bn and 25 clients maxi
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