NAOS Ex-50 Opportunities Co. Ltd. · ASX:NAC
NAOS Ex-50 Opportunities — Q4 FY2019 Earnings Presentation
30 slides from NAOS Ex-50 Opportunities's earnings presentation, Jul 25, 2019
Slide 1: FY19 Q4 Investor Conference Call
NAOS Asset Management For personal use only FY19 Q4 Investor Conference Call Thursday, 25th July 2019 |10:30 am (AEST) 1300 289 804 (National Toll Free) +61 3 8687 0635 (International Direct Dial) Guest Access Code: 1084 2873# CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Lim
Slide 2: Important Information
Important Information For personal use only 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 fina
Slide 3: Our Mission
NAOS Asset Management Our Mission For personal use only To provide investors 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
Slide 4: Investment Beliefs
NAOS Investment Beliefs For personal use only Value with Long Quality over Invest for the Performance v Term Growth Quantity Long Term Liquidity Focus (5+ years) Ignore the Pure Exposure Environmental, Management Index to Industrials Social and Alignment Governance (ESG) We do not invest in tobacco,
Slide 5: Investment Mandate
NAOS Investment Mandate For personal use only 01 02 NAOS seeks to protect investor NAOS provides investors with genuine capital whilst providing a sustainable long- term, concentrated exposure to growing stream of fully franked Australian undervalued listed micro, dividends and capital growth above
Slide 6: Listed Investment Companies
NAOS Listed Investment Companies Each of our LIC’s target a concentrated portfolio of 10-20 companies For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 6
Slide 7: Investment Portfolio Performance - Financial Year Returns
* Investment Portfolio Performance - Financial Year Returns For personal use only 35% 30% 25% 20% 15% 10% 5% 0% -5% -10% -15% FY15 (Part Year FY18 (Part Year FY13 (Part Year) FY14 FY16 FY17 FY19 NAC) NSC) NCC 10.67% 31.54% 1.43% 24.77% 12.39% 7.13% -12.51% NAC 9.21% 30.16% 6.69% 10.25% -2.86% NSC -3
Slide 8: Strong long term risk adjusted returns
* Strong long term risk adjusted returns For personal use only NAOS INVESTMENT PORTFOLIO PERFORMANCE SINCE INCEPTION BENCHMARK PERFORMANCE NCC +11.03% p.a. +6.19% p.a. (XSOAI) NAC +11.05% p.a. +8.49% p.a. (XKIAI) NCC RISK METRICS NCC Benchmark (XSOAI) NAC RISK METRICS NAC Benchmark (XKIAI) 14% 13.21
Slide 9: Market Commentary
Market Commentary High growth and technology stocks continued to outperform For personal use only % PRICE CHANGE INDEX POINTS FY19 EXPECTED COMPANY FY19 EXPECTED EBITDA FY19 ADDED FY19 to XSO EV/EBITDA Afterpay Touch (ASX: APT) +155.10% 33.3 $17,018,000 384.84 Wisetech Global (ASX: WTC) +77.20% 20.5
Slide 10: Market Commentary: growth rate priced in over next 5 years
Market Commentary What growth rate is the market pricing in over the next 5 years? For personal use only FY19 FY20 FY21 FY22 FY23 FY24 EBITDA $100 $150 $225 $338 $506 $759 Share Price $11.00 $13.50 $18.00 $16.88 $17.72 $11.39 EBITDA Valuation Multiple 110 90 80 50 35 15 EBITDA Growth p.a. 50% CONVIC
Slide 11: Market Commentary: index return contributions FY19
Market Commentary All companies within the XKI and their respective contribution or detraction to the total index return For personal use only for FY19 prior to dividends Number of Companies 120 100 Number of Companies 80 60 40 20 0 -100 -90 -80 -70 -60 -50 -40 -30 -20 -10 0 10 20 30 40 50 60 70 80
Slide 12: Focus on the controllable
Focus on the controllable NAOS will continue to focus on the controllable to maximise risk adjusted returns For personal use only 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
Slide 13: NCC Key Portfolio Events Q4 FY19
NCC Key Portfolio Events Q4 FY19 For personal use only HOLDING INDUSTRY Q4 UPDATE • Announced acquisition of a healthcare distribution business, we believe this will be a transformative deal for the company. BTC Health Medical Device • The deal provides significant growth potential both through incr
Slide 14: NCC Overview as at June 2019
NCC Overview as at 30 June 2019 For personal use only $80.1m $1.02 8.19% $0.885 (13.24%) Weighted Average Fully Franked Discount to Pre Tax Market Capitalisation Pre Tax NTA Share Price Dividend Yield NTA of the Investments FULLY FRANKED DIVIDEND (CENTS PER SHARE) $0.3925 $0.10 $0.40 Cumulative Divi
Slide 15: NSC Key Portfolio Events Q4 FY19
NSC Key Portfolio Events Q4 FY19 For personal use only HOLDING INDUSTRY Q4 UPDATE • EXP recently announced a complete overhaul of the board and management team. Experience Co Tourism & • Dominant position in its two main markets. (ASX: EXP) Leisure • Little gearing on the balance sheet. • EXP has re
Slide 16: NSC Overview as at June 2019
NSC Overview as at 30 June 2019 For personal use only (19.29%) $170.8m $0.70 7.08% $0.565 Discount to Pre Tax Weighted Average Fully Franked Share Price Market Capitalisation Pre Tax NTA NTA Dividend Yield of the Investments FULLY FRANKED DIVIDEND (CENTS PER SHARE) $0.10 $0.09 $0.04 Cumulative Divid
Slide 17: NAC Key Portfolio Events Q4 FY19
NAC Key Portfolio Events Q4 FY19 For personal use only HOLDING INDUSTRY Q4 UPDATE • APE believe there will continue to be choice and competition for consumers in these markets following the ACCC’s preliminary views on the proposed merger with AHG. Motor AP Eagers • Announced the sale and leaseback o
Slide 18: NAC Overview as at June 2019
NAC Overview as at 30 June 2019 For personal use only $390.9m $1.00 6.55% $0.825 (17.50%) Weighted Average Market Fully Franked Discount to Pre Tax Pre Tax NTA Share Price Capitalisation of the Dividend Yield NTA Investments FULLY FRANKED DIVIDEND (CENTS PER SHARE) $0.2105 $0.20 $0.06 Cumulative Div
Slide 19: Capital Management Initiatives
Capital Management Initiatives • NSC commenced an on-market buy-back during Q4 FY19, the total number of shares purchased under For personal use only the Buy-Back Program was 2,054,777 to 30 June 2019. • The Board considers this to be an effective use of the Company’s capital to close the discount t
Slide 20: National Investor Roadshow
NAOS National Investor Roadshow For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 20
Slide 21: Appendix
Appendix For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 21
Slide 22: NTA & Performance as at June 2019
NTA & Performance as at 30 June 2019 For personal use only INCEPTION PRE TAX NTA 1 MONTH 1 YEAR INCEPTION (P.A.) (Total Return) NCC* $1.02 +0.20% -12.51% +11.03% +94.08% (6 years 5 months) NSC^ $0.70 +1.33% -13.29% -10.63% -16.27% (19 months) NAC* $1.00 +2.29% -2.86% +11.05% +62.43% (4 years 8 month
Slide 23: Management alignment
NAOS management alignment For personal use only Inception Directors Shareholding (Ordinary Shares) 30 June 2019 Directors Shareholding (Ordinary Shares) 8,000,000 7,526,514 7,000,000 6,000,000 5,000,000 4,061,457 4,000,000 3,000,000 2,026,836 1,960,054 2,000,000 1,007,288 1,000,000 837,958 0 NAC NCC
Slide 24: Investment process
NAOS investment process For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 24
Slide 25: ESG framework
NAOS ESG framework For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 25
Slide 26: Historical shareholder numbers
Historical shareholder numbers For personal use only NCC Shareholders NAC Shareholders NSC Shareholders 9,000 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 0 Jun-13 Jun-14 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 26
Slide 27: Investor awareness and communication
Investor awareness and communication For personal use only CEO Insights, NAOS Shareholder Monthly Investment The news and media Twice yearly National Newsletter, Conference Calls, Report & NTA email section of our website Roadshow subscribe via our subscribe via our updates, subscribe via is updated
Slide 28: Asset Management giving back
NAOS Asset Management giving back NAOS, the management company, is proud to be supporting the following charities For personal use only ‘Golden Shouldered Parrot’ threatened ‘Reef Aid’ campaign, in partnership RFDS, dedicated to providing species project, in partnership with with Greening Australia
Slide 29: Directors and Team
NAOS Directors and Team For personal use only 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 Indepe
Slide 30: Q&A
Q&A For personal use only Thank you for your continued support CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 30
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