WAM Active Ltd. · ASX:WAA
WAM Active — Investor Presentation (May 2012)
33 slides from WAM Active's investor presentation, May 7, 2012
Slide 1: WAM Active Limited (WAA)
WAM Active Limited (WAA) For personal use only
Slide 2: Executive summary
Executive summary For personal use only • Investment Portfolio has outperformed by 7.6% financial year to 31 March 2012 • A Average equity it weighting i hti 51% • 12.5% increase in fully franked interim dividend to 4.5 cents per share • Annualised fully franked dividend yield 8.3%* • Bonus Option p
Slide 3: Strategic direction
Strategic direction For personal use only • Board’s commitment to grow the market capitalisation from its current levels of $18m to $100m through g various capital p management g initiatives ((option p issue)) • Continue to achieve outperformance through investment objectives: ¾ To preserve capital
Slide 4: Option issue
Option issue For personal use only • Bonus option issue on a 1 for 1 basis • Exercise price: $1.08 • C exercise Can i att any titime up until til 12 D December b 2013 • Options trade on the ASX under the code “WAAO” 4
Slide 5: Option issue: Frequently asked questions
Option issue Frequently asked questions For personal use only Why? • Create value for all shareholders • Increase size of Company - making it more relevant • Continue to grow the Company • Lower L th Company’s the C ’ managementt expense ratio ti (MER) How will the money be invested? • In accordance
Slide 6: Consistent outperformance
Consistent outperformance For personal use only Since Performance 1 Yr 2 Yrs 3 Yrs Inception as at 31 March 2012 % %pa %pa (Jan-08) %pa WAA Investment +4.6% +6.3% +20.3% +12.1% Portfolio S&P/ASX All Ordinaries -6.2% -0.9% +12.3% -4.3% Accumulation Index Outperformance +10.8% +7.2% +8.0% +16.4% 6
Slide 7: Performance
Performance Financial Year 31 March 2012 For personal use only WAA Investment Portfolio +6.1% WAA Pre-tax NTA p per share g growth p plus dividends +3.0% WAA Share price growth plus dividends +11.7% S&P/ASX All Ordinaries Accumulation Index -1.5% 7
Slide 8: Outperformance since inception
Outperformance since inception For personal use only WAM Active has outperformed the market by 16.4% p.a. over 4¼ years Index re-based 80 60 40 20 0 -20 -40 -60 WAM Active Ltd - Investment Portfolio (before all expenses, fees, taxes and dividends) S&P/ASX All Ordinaries Accumulation Index 8
Slide 9: Premium / Discount to NTA
Premium / Discount to NTA For personal use only 30% 20% % 10% um unt / Premiu 0% Discou ‐10% ‐20% ‐30% 2008 2009 2010 2011 2012 * *To 20 April 2012 9
Slide 10: Dividend growth
Dividend growth For personal use only cents per share 10.0 9.0 8.0 7.0 60 6.0 5.0 4.0 3.0 2.0 1.0 0.0 2008/09 2009/10 2010/11 2011/12* Fully franked dividends * Annualised interim dividend 10
Slide 11: Contributors / Detractors
Contributors / Detractors For personal use only Best Performing Stocks Financial Year to 31 March 2012 Company Strategy Unrealised/ Realised Gains SGI Signature Capital Investments Ltd LIC Discount to NTA $285,946 ILF ING Real Estate Community Living Group Discount to NTA $117,369 CCQ Contango Capit
Slide 12: Top Stocks
Top 10 Stocks as at 31 March 2012 For personal use only % Gross Company Assets CCQ Contango Capital Partners Limited 2.9% ILF ING Real Estate Community Living Group 2.3% EPX Ethane Pipeline Income Fund 2.2% AIX Australian Infrastructure Fund 2.1% SDG Sunland Group Limited 2 1% 2.1% GFF Goodman Field
Slide 13: Market Driven strategy
Market Driven strategy For personal use only Number of trades Financial Year to 20 April p 2012 Turnover of 6.8 times or 680% invested equity: Number of trades: 2,183 Individual stocks 254 traded: Takeovers: 37 Placements: 53 Short Sales: 24 13
Slide 14: Australian Infrastructure Fund (AIX)
Australian Infrastructure Fund (AIX) For personal use only • Idea generated through an industry peer • Visited the company p y to understand the companies p strategy gy • NTA: $2.91 vs share price of $2.20 • Catalysts: management committed to close NTA discount, strategic review, management internal
Slide 15: ING Real Estate Community Living Group (ILF)
ING Real Estate Community Living Group (ILF) For personal use only • Started buying below $0.10. Idea generated by analyst stock screen of stocks trading below NTA • Managing Director previously at Aevum which we successfully owned in the past, rate highly • S Several l one on one meetings ti with i
Slide 16: Did you know?... Facebook
Did you know?... Facebook For personal use only • Valuation IPO: $77 - $96 billion • P/E: 93 - 117x • 901 million illi members b or 13% off th the global l b l population l ti and d growing i • Every member is worth $85 - $107 to Facebook • Each member generates $4.69 in revenue and around 91 cents
Slide 17: Looking ahead
Looking ahead For personal use only • Continued high level of takeovers and corporate p actions • • Further short selling opportunities • Continued low level of capital raisings • 17
Slide 18: Looking ahead
Looking ahead For personal use only Source: Credit Suisse strategy 18
Slide 19: Summary
Summary For personal use only • Investment team continue to scour the market for Market Driven opportunities and deliver performance p • Board is focused on delivering a rising stream of fully franked dividends • Cautiously optimistic on Australian equity market 19
Slide 20: Questions?
For personal use only Questions? 20
Slide 21: Additional Information
For personal use only Additional Information 21
Slide 22: Who is Wilson Asset Management?
Who is Wilson Asset Management? For personal use only • The WAM Group is the fund manager of three listed investment companies and one unlisted fund, with funds under management g of approximately pp y $340 million. • Concentrates on growth companies predominantly in the small to mid cap area of the
Slide 23: What Wilson Asset Management delivers
What Wilson Asset Management delivers For personal use only • Quick decision making • Bottom up approach • Staying y g very y close to the market and investee companies p • Strong risk adjusted returns • Significant market experience • Closed end fund - avoiding being forced seller and buyer at inap
Slide 24: The Team
The Team For personal use only Geoff Wilson - Chairman / Portfolio Manager Kate Thorley - CEO & Company Secretary Chris Stott - CIO / Portfolio Manager Matt Haupt - Equity Analyst Martin Hickson - Analyst / Dealer Mark Tobin - Assistant Analyst Linda Vo - Senior Financial Accountant Lillie Johnson -
Slide 25: Our Business Model
Our Business Model For personal use only Investment Focus – Growth Companies LIC Structure + Experienced Benefits Team Investment + Flexible + Tight Cost Process Mandate Control Superior Long Term = Performance Record 25
Slide 26: Our Funds
Our Funds For personal use only WAM Capital (WAM) WAM Research WAM Active (WAX) (WAA) Research Market Driven Driven 26
Slide 27: Investment process: Market Driven
Investment process “ Market Driven” Driven For personal use only We scour the market for opportunities: • Initial public offerings • Capital raisings • Block trades • Oversold positions • Takeovers • Listed Investment Companies (LIC) discount to net tangible assets (NTA) • Stocks trading at a discou
Slide 28: LICs are superior investment vehicles
LICs are superior investment vehicles For personal use only Listed Investment Companies are very attractive investment vehicles • LICs have outperformed the market ^ • Studies show LICs outperform managed funds*^ • Closed pool of capital – never forced seller or buyer • P id consistent Provide i t t
Slide 29: LICs outperform the share market over the long term
LICs outperform the share market over the long term For personal use only 10000 LIC Total Return Index ASX All Ords Accum 1000 100 979 981 983 985 987 989 991 993 995 997 999 001 003 005 007 009 19 19 19 19 19 19 19 19 19 19 19 20 20 20 20 20 * Source: Morgan Stanley Smith Barney 29
Slide 30: WAM Funds outperformance vs ASX LIC Index
WAM Funds outperformance vs ASX LIC Index For personal use only Source: Iress 30
Slide 31: External research coverage
External research coverage For personal use only Research Houses covering listed investment companies & WAM Active: - Bell Potter Securities - Morgan Stanley Smith Barney - Z ith P Zenith Partners t - Independent Investment Research - APAM LIC Research - Evans & Partners - JBWere - Morningstar - E.L
Slide 32: Investor communications
Investor communications For personal use only ¾ Website – wamfunds.com.au ¾ Subscribe for weekly emails – includes market update ¾ Audio casts – Monthly ¾ Media – Sky Business, Switzer, CNBC, Newspapers, Industry Magazines ¾ Half yyearlyy Investor Newsletters ¾ Half yearly Results and Media Release
Slide 33: Disclaimer
For personal use only Disclaimer This presentation has been prepared for use in conjunction with a verbal presentation and should be read in that context. Information for the graphs, charts and quoted indices contained in this presentation has been sourced from IRESS Market Technology, Credit Suisse