Magellan Financial Group Ltd · ASX:MFG
Magellan Financial — H1 FY2020 Earnings Presentation
20 slides from Magellan Financial's earnings presentation, Feb 13, 2020
Slide 1: Magellan Financial Group Limited Half Year Results
Magellan Financial Group Limited Half Year Results For personal use only For the half year ended 31 December 2019
Slide 2: Magellan Financial Group Interim Results
Magellan Financial Group Interim Results $ million 31 Dec 2019 31 Dec 2018 % change For personal use only Management and services fees 288.2 228.1 26% Performance fees 41.7 42.7 (2%) Other revenue 7.1 5.6 27% Adjusted revenue 337.0 276.4 22% Adjusted expenses (56.0) (49.3) 14% Adjusted net profit be
Slide 3: Interim Highlights
Interim Highlights For personal use only • Strong growth in: – Average funds under management up 29% to $92.8 billion1 – Management and services fee revenue up 26% to $288.2 million1 – Profit before tax of the Funds Management business up 24% to $279.0 million1 – Excluding performance fees the profi
Slide 4: Tax and Dividends
Tax and Dividends For personal use only • Effective tax rate for the 6 months to 31 December 2019 is 22.3% (Offshore Banking Unit) • Dividends: – Interim dividend up 26% to 92.9 cents per share (75% franked) – Pay dividends promptly – 27 February 2020 (Interim Dividend) – Dividend policy1 : o Interi
Slide 5: Expenses
Expenses For personal use only • View costs associated with strategic initiatives as outside day-to-day operating expenses – Excluded from Funds Management business – Excluded from dividend payout • Employee expenses account for ~60% of Funds Management expenses – Expect modest headcount increases f
Slide 6: Funds Management Business
Funds Management Business For personal use only $ million 31 Dec 2019 31 Dec 2018 % change Revenue Management fees 285.9 225.8 27% Performance fees 41.7 42.7 (2%) Services fees 2.3 2.4 (0%) Interest/other income 4.0 2.4 65% 333.9 273.2 22% Expenses Employee expense 36.2 30.9 17% Marketing expense 1.
Slide 7: Funds Under Management Summary
Funds Under Management Summary 31 December 2018 30 June 2019 31 December 2019 For personal use only Closing FUM ($ billion) % % % Retail 19.0 27% 23.2 27% 26.9 28% Institutional 51.8 73% 63.5 73% 70.6 72% Total FUM 70.8 100% 86.7 100% 97.5 100% Average FUM ($ billion) Retail 19.5 20.4 25.0 Instituti
Slide 8: Investment Performance
Investment Performance For the periods to 31 December 2019 For personal use only Since 1 Year 3 Years 5 Years Inception (%) (% p.a.) (% p.a.) (% p.a.)1 Magellan Global Fund 28.1 17.1 13.9 12.4 MSCI World NTR Index ($A) 27.9 13.7 12.1 6.9 Magellan Infrastructure Fund 25.5 13.6 11.6 9.2 Global Listed
Slide 9: Funds Under Management
Funds Under Management As at 31 December 2019 ($ billion) For personal use only Strategy 30 June 2019 Net Inflows Investment Performance 31 December 20191 Global Equities $64.0 $2.5 $5.7 $71.7 Global Listed Infrastructure $15.2 $1.1 $1.4 $17.6 Australian Equities $7.5 $0.0 $0.7 $8.2 $86.7 $3.6 $7.8
Slide 10: 1H20 FUM Flows
1H20 FUM Flows Retail Net Inflows1 For personal use only Institutional Net Inflows 1,400 3,000 $ Millions $ Millions $1,218m 1,200 2,500 $2,397m 1,000 $887m 2,000 800 1,500 600 1,000 400 $475m 200 500 0 0 1H19 1H20 1H19 1H20 Total net inflows for the 6 months ended 31 December 2019: $3.6 billion 1.
Slide 11: Well-balanced Business
Well-balanced Business For personal use only Funds Under Management1 Base Fees2 28% 46% 54% 72% Retail FUM Institutional FUM Retail Fees Institutional Fees 1. FUM split is as at 31 December 2019. 2. Base Fees are Management and Services fees for the six months to 31 December 2019 and exclude Perform
Slide 12: Magellan High Conviction Trust
Magellan High Conviction Trust For personal use only • Raised ~$862 million – Priority Offer: $632 million – General Public/Wholesale Offers: $230 million • Approximately 17,000 registered unitholders • Net one-off transaction costs of $53.4 million, including Loyalty and IPO Foundation Units Magell
Slide 13: Investor Partnership
Investor Partnership Listed funds For personal use only Closed-ended Open-ended FUM $3.4 billion $2.4 billion Funds and MGE: ~23,000 MGG: ~35,000 number of MHG: ~1,370 MHH: ~17,000 unitholders MICH: ~11,000 Partnership benefits, with Magellan Simplification, CHESS paying for the discount Live pricin
Slide 14: Listed Unitholder Growth
Listed Unitholder Growth 100,000 For personal use only 90,000 MHH 80,000 70,000 60,000 MGG 50,000 40,000 30,000 20,000 Active ETFs 10,000 0 Mar-15 Jul-15 Nov-15 Mar-16 Jul-16 Nov-16 Mar-17 Jul-17 Nov-17 Mar-18 Jul-18 Nov-18 Mar-19 Jul-19 Nov-19 Number of registered unitholders across Magellan Global
Slide 15: Institutional Client Diversity
Institutional Client Diversity For personal use only 12% % of Total Management & Services Fees 10% 8% 6% 4% 2% 0% 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Top 30 Institutional Clients Cumulative Total Management and Services Fees Top Institutional Clients 5 10
Slide 16: Principal Investments
Principal Investments For personal use only • Principal Investments include investments in Magellan Funds, listed shares and a small number of unlisted investments Investment ($ million) 31 Dec 2019 30 June 2019 Cash 0.7 4.6 Magellan Unlisted Funds1 271.3 213.4 Listed shares/funds2 142.6 125.7 Other
Slide 17: Principal Investments (cont.)
Principal Investments (cont.) For personal use only • Board has set a pre-tax hurdle 10% p.a. (over business cycle) for the Principal Investments portfolio Investment Returns: Time Period Return 1 Year to 31 December 2019 28.3% 3 Years to 31 December 2019 p.a. 16.9% 5 Years to 31 December 2019 p.a.
Slide 18: Other
Other For personal use only • Continue to make progress on a range of new initiatives including: – Airlie Australian Share Fund: making available via ASX, represents convergence of listed and unlisted funds into a single entity, significant simplification – Retirement Income: continue to make progre
Slide 19: Important Information
Important Information This presentation has been prepared by Magellan Financial Group Limited ACN 108 437 592 (“Magellan”). For personal use only This presentation contains summary information about Magellan and is current as at 13 February 2020. While the information in this presentation has been p
Slide 20: For personal use only
For personal use only www.magellangroup.com.au Phone: +61 2 9235 4888
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