Australian Ethical Investment Ltd · ASX:AEF
Australian Ethical Investment — Investor Presentation (February 2019)
19 slides from Australian Ethical Investment's investor presentation, Feb 22, 2019
Slide 1: FY19 Half Year Results
FY19 Half Year Results Phil Vernon | Managing Director and CEO Mark Simons| CFO
Slide 2: Highlights
Highlights
Slide 3: Growth, Investment performance, Awards
Growth Investment performance Awards Continued growth across the business% • Australian Shares Fund outperformed the benchmark# Winner – Financial over the 6 month period; continued outperformance Standard Investment Over 45,000 super over the long term Leadership Award – ESG for members 20% the Aus
Slide 4: Investment Portfolio and Our Foundation
Investment Portfolio Our Foundation Share investments produced 66% less CO2 than benchmark1 10% of AEI profits donated to not-for-profit organisations 6 $620k grants distributed in September 2018 Nil investment in fossil fuels2 Multi-year partnership arrangements: • Empowering women with Human Right
Slide 5: Financials
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Slide 6: Key themes
Key themes Revenue 17,400 19,753 14% Operating expenses (14,173) (15,154) 7% • Continued FUM growth driving Total expenses (14,173) (15,154) 7% higher revenues • Fee reductions in October 18 driving Profit before tax 3,227 4,599 43% lower average FUM based fee margins of Income tax expense (909) (1,
Slide 7: FUM $2.85bn as at 31 December 2018
FUM ($bn) ($m) 2.85 Superannuation 2.60 0.16 Managed Funds 0.16 0.81 $2.85bn as at 31 December 2018 Institutional 1.84 0.74 0.01 1.40 0.57 0.01 1.04 0.48 1.89 0.34 1.70 1.26 0.91 0.69 2014 2015 2016 2017 2018 Managed Funds As at 31 December of each year Wholesale 19% Superannuation Change $bn 66% 1H
Slide 8: Super members up 20%
Super members up 20% 45,170 37,699 30,535 23,570 19,284 2014 2015 2016 2017 2018 As at 31 December of each year 8
Slide 9: Key themes: net flows
Key themes • Net flows down on prior corresponding period primarily due to large institutional win in 2017 • Super net flows down 20% due to lower rollovers, partially offset by higher SG contributions during the Superannuation period Managed Funds • Managed Fund Wholesale flows 341.4 Institutional
Slide 10: Key themes: revenue and expenses
Key themes • Super FUM growth of 11% 0.1 driving strong revenue 0.2 2.1 growth • Managed Funds FUM tilt 0.1 0.1 0.2 0.2 to Wholesale, as well as 0.2 0.2 fee and threshold reductions driving lower average fee margins 19.8 • Relatively low expense 17.4 increase due to timing of 14.2 15.2 expenditure i
Slide 11: Key themes: balance sheet
Key themes 15.0 • Strong balance sheet with 13.6 no debt 11.7 • Strong cash position 11.9 • Parent holds surplus regulatory capital of $5m 9.2 2014 2015 2016 2017 2018 As at 31 December of each year Net Assets Cash and cash equivalents * Represents total assets less total liabilities attributable to
Slide 12: Key themes: FUM, revenue and profit
Key themes 2.85 2.60 19.8 17.4 • FUM growth continues 1.84 despite market volatility 13.3 1.40 10.9 9.9 • 1H19 revenue growth 1.04 impacted by further fee reductions to our customers • Continuing to invest in 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 growing the business As at 31 December of
Slide 13: Key themes: earnings per share and dividend
2.84 Key themes 2.00 • Continue to deliver value to shareholders 1.93 1.65 • 1H19 dividend 2c, up 21% 1.20 1.36 0.80 0.50 0.51 0.51 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 *attributable to shareholders for six months ending 31 December Six months ending 31 December. Historic data restated
Slide 14: Annualised return
S&P/ASX 200 - Total Return 12,000 Australian Ethical Australian Shares Fund S&P/ASX SMALL INDUSTRIALS – Total Return Australian Shares Fund - Net S&P/ASX SMALL ORDINARIES – Total Return 10,000 S&P/ASX 200 INDUSTRIAL – Total Return S&P/ASX Small Industrials 8,000 S&P/ASX All Ordinaries 6,000 Annualis
Slide 15: Australian Shares Fund outperformed the market over 6 months
Australian Shares Fund outperformed the market over the 6 months ending 31 December 2018, despite the large allocation to small caps - once again highlighting its defensive qualities in a down market. Continued outperformance over the long term (5+ years) 6mths 1Y 3Y 5Y 7Y 10Y 20Y Since Incept’n (%)
Slide 16: Default MySuper Balanced Accumulation option met 5 year objective
Our default MySuper Option, the Balanced Accumulation option has met its 5 year investment objective of delivering a return above CPI +3.5%, whilst also outperforming its peer based benchmark 6mths 1Y 3Y 5Y 7Y 10Y Since Incept’n* (%) (%) (%p.a.) (%p.a.) (%p.a.) (%p.a.) (%p.a.) Balanced Accumulation
Slide 17: Well placed to capture opportunities for growth
• Well placed to capture opportunities for growth in a sector facing increasing mistrust • Continued investment in initiatives to support growth in enhanced customer experience through new digital platform, product development, increased brand awareness and nurturing intermediated channels • Alignme
Slide 18: Australian Ethical Investment Ltd disclaimer
Australian Ethical Investment Ltd (ABN 47 003 188 930; AFSL No. 229949) (Australian Certain statements in this presentation relate to the future. Such statements involve Ethical) is the Responsible Entity and Investment Manager of the Australian Ethical known and unknown risks and uncertainties and
Slide 19: australianethical
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