Pengana Capital Group Ltd. · ASX:PCG
Pengana Capital — FY2023 Earnings Presentation
22 slides from Pengana Capital's earnings presentation, Aug 24, 2023
Slide 1: Shareholder Presentation for the Year Ended 30 June 2023
PENGANA CAPITAL GROUP SHAREHOLDER PRESENTATION FOR THE YEAR ENDED 30 JUNE 2023 Russel Pillemer Katrina Glendinning Chief Executive Officer Chief Financial Officer
Slide 2: Table of Contents
PENGANA CAPITAL GROUP TABLE OF CONTENTS I Business Overview II Year in Review III Strategic Update PENGANA CAPITAL GROUP | PAGE 2
Slide 3: Section I: Business Overview
bn SECTION | BUSINESS OVERVIEW
Slide 4: Group Overview
GROUP OVERVIEW Leading Australian provider of premium, value added products Focused on the higher-end retail market: financial Recognised, well-regarded brand built over 20 years • Loyal client base advisors, SMSFs and HNW’s • Product well-rated by research houses; • Serviced by experienced and capa
Slide 5: Compelling Track Records with Capacity to Grow
COMPELLING TRACK RECORDS WITH CAPACITY TO GROW (AS AT 30/06/2023) Performance Since Inception p.a. 13 FUM Indicative Further Fund Benchmark Relative Primary Fund/Vehicle Name Strategy Team Current ($m) FUM Capacity ($bn) % % % Pengana Australian Equities1 Australian Multi Caps Internal 682 Limited 8
Slide 6: Growth in Funds Under Management
GROWTH IN FUNDS UNDER MANAGEMENT (“FUM”)1 HISTORICAL GROWTH IN • Focus over the past few years has been on re-positioning the FUM ($M)2 business for future FUM growth at higher margins • FUM flat over the 12 months to 30 June 20233 $4,000 $3,974 $3,519 • positive performance for the period of $338 m
Slide 7: Analysis of Management Fees
ANALYSIS OF MANAGEMENT FEES (AS AT 30/06/2023) MANAGEMENT FEE SPLIT IN FY2023 • Funds under management (“FUM”) subject to ($36.0M) management fees of $3.05bn (at 30/06/2023) • Average gross management fee rate of 1.19% (FY22: 1.19%) • Management fees of $36.0 million in FY2023 split: • 38% to Invest
Slide 8: Annual Gross Fee Margin
ANNUAL GROSS FEE MARGIN 3.5% First time in 9 years where no performance fees were 3.23% derived across the business 3.0% 2.5% 2.37% 2.20% 2.19% 2.0% 1.69% 1.56% 1.5% 1.43% 1.33% 1.0% 1.18% 1.15% 1.12% 1.15% 1.14% 1.18% 1.17% 1.19% 1.18% 0.5% FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY
Slide 9: Overview of Performance Fees
OVERVIEW OF PERFORMANCE FEES (AS AT 30/06/2023) • Well diversified sources of performance fees (“PFs”) provide FUM SUBJECT TO added stability: PERFORMANCE FEES ($2.4BN) • Absolute hurdles (higher level of certainty and consistency): 51% • Market Relative hurdles – (predominantly) Style Agnostic stra
Slide 10: Section II: Year in Review
SECTION II YEAR IN REVIEW
Slide 11: Key Developments in FY2023
KEY DEVELOPMENTS IN FY2023 • Strong, mostly double-digit absolute returns across majority of strategies in the financial year ○ However, no performance fees earned as all funds under their high-water-marks ○ It is important to note that performance fees will fluctuate, especially over relatively sho
Slide 12: Financial Performance to 30/06/2023
FINANCIAL PERFORMANCE TO 30/06/2023 • Closing 30 June 2023 FUM of $3.05bn (31 July 2023: $3.03bn, after payment of $62.7 million in distributions) • Absence of performance fees (compared to $32.7 million in FY 2022), had significant impact on FY2023 profitability • Operating EBITA down to $3.7 milli
Slide 13: Underlying Profitability
UNDERLYING PROFITABILITY1 Increase/ Increase/ 2023 2022 Pengana Capital Group (Decrease) (Decrease) Comment $’000 $’000 $’000 % Management fee revenue 35,973 41,768 (5,795) (13.9) Lower average FUM Performance fee revenue - 32,727 (32,727) (100.0) No performance fees in period Net fund direct expens
Slide 14: Statutory Profit
STATUTORY PROFIT Pengana Capital Group ($’000) 2023 2022 Underlying profit before tax1 6,028 29,210 Less: Less: investment gains recorded in other comprehensive income reserve (1,036) 2,766 Less: LSP interest income (not on profit & loss) (1,802) (1,388) Less: Amortisation & non-cash items (3,487) (
Slide 15: Balance Sheet
BALANCE SHEET1 30 Jun 2023 30 Jun 2022 Pengana Capital Group ($’000) ($’000) Cash net of AFSL cash requirements 10,740 19,965 Receivables 4,064 7,865 Payables (4,206) (12,204) Net working capital 10,598 15,626 Investments net of AFSL liquid asset requirements and associated current liabilities 6,196
Slide 16: Section III: Strategic Update
SECTION III STRATEGIC UPDATE PRIVATE MARKET STRATEGIES PENGANA CAPITAL Private Equity MARKETS Private Credit
Slide 17: Private Markets
PRIVATE MARKETS • PCG’s stated aim over the last few years has been to grow our private markets businesses • This will provide PCG with strong growth, diversification, stability and higher margins • Demand for private markets exposures is growing at a rapid rate in Australian and offshore global mar
Slide 18: Private Credit
PRIVATE CREDIT (“PC”) • Strong demand for PC from Australian retail and HNW investors; expected to continue/increase as investors become more comfortable with the growing asset class • Significant number of offerings already in the market. However, there is a large gap in the market due to: ○ Qualit
Slide 19: Thank You
THANK YOU • We thank you for taking the time to read our shareholder presentation. • The Pengana team is excited to deliver on our plans for the coming period where the opportunities described will come to fruition in the public domain. • We are confident these new offerings will be a testament to o
Slide 20: Private Capital Markets Business
PRIVATE CAPITAL MARKETS (“PCM”) BUSINESS • PCG has recognised a significant opportunity to build/grow a capital markets business: ○ Capital raisings for discreet opportunities, including individual equities, credit instruments and funds ○ Predominantly in private markets – synergistic with PCG’s pri
Slide 21: Disclaimer
DISCLAIMER This presentation has been prepared by Pengana Capital Group Limited (ABN 43 059 300 426) (PCG). The information in this presentation is current as at 24 August 2023. This presentation is not an offer or invitation for subscription or purchase of securities or a recommendation with respec
Slide 22: For More Information
PENGANA CAPITAL GROUP FOR MORE PENGANA CAPITAL LIMITED ABN 30 103 800 568 CLIENT SERVICE T: +61 2 8524 9900 INFORMATION AFSL 226566 Suite 1, Level 27, E: clientservice@pengana.com pengana.com Governor Phillip Tower, 1 Farrer Place, Sydney, NSW, 2000 T: +61 2 8524 9900 F: +61 2 8524 9901 PENGANA.COM