Invesco Ltd · NYSE:IVZ
Invesco — Amvescap — FY2002 Earnings Presentation
22 slides from Invesco's earnings presentation, Feb 4, 2003
Slide 1: 2002 Year End Results
AMVESCAP Helping people worldwide build their financial security 2002 Year End Results Charles W. Brady, Executive Chairman John D. Rogers, CEO, INVESCO Division Robert F. McCullough, Chief Financial Officer February 4, 2003
Slide 2: Forward-Looking Statement
Forward-Looking Statement Callers who access the call during the live transmission will be deemed to have solicited access to the call for the purposes of the UK Financial Services and Markets Act regime governing real-time financial promotion. The presentations that follow may include information t
Slide 3: Agenda
Agenda ¢ Year in Review – Charles Brady ¢ INVESCO Division Update – John Rogers ¢ Financial Review – Robert McCullough ¢ Questions – Charles Brady 3
Slide 4: Financial Review
AMVESCAP Financial Review
Slide 5: Group Profit & Loss Account
Group Profit & Loss Account Year Ended December 31, 2002 2001 Revenues £1,345,263 £1,619,847 Expenses: Operating (978,338) (1,096,487) Exceptional (69,248) (59,997) Goodwill amortization (149,415) (137,477) Operating profit 148,262 325,886 Investment income 6,561 10,433 Interest expense (52,558) (55
Slide 6: Cost Reduction Initiatives
Cost Reduction Initiatives ¢ Targeted cost reductions of $150m by end of 2003, including headcount reductions of 500 people. ¢ Q4 reduced headcount by 412 people. ¢ Annualized run-rate savings (v. Q3 2002 run rate) Q4 $55m H1-2003 $130m H2-2003 $150m ¢ Further work in progress on group-wide efficien
Slide 7: Exceptional Items 2002
Exceptional Items 2002 in thousands Q2 Q4 Total Redundancy and reorganizations £14,381 £30,163 £44,544 Project costs 798 12,084 12,882 Leases and other 4,888 6,934 11,822 £20,067 £49,181 £69,248 Total exceptional items net of tax £14,218 £42,198 £56,416 7
Slide 8: Headcount
Headcount Dec 31, Sept 30, Dec 31, 2002 2002 2001 Managed Products 3,775 3,983 4,346 INVESCO Institutional 803 841 868 INVESCO Global 2,121 2,225 2,334 INVESCO Retirement 561 565 561 Private Wealth 171 221 252 New Business 73 79 76 Corporate 77 79 82 7,581 7,993 8,519 8
Slide 9: Quarterly Financial Comparisons
Quarterly Financial Comparisons in thousands 2002 2002 Q4 Q3 % change Revenues £ 291,099 £ 307,479 -5% Operating expenses 220,273 224,343 -2% Operating profit 70,826 83,136 -15% Operating margin 24.3% 27.0% -10% EBITDA 83,612 98,781 -15% EPS - diluted 5.0p 6.0p -17% EBITDA per share - diluted 10.3p
Slide 10: EPS Comparisons
EPS Comparisons Full Year % 2002 2001 Change Earnings per share (before goodwill and exceptional items): -Basic 27.5p 41.2p -33% -Diluted 27.2p 40.0p -32% -Diluted per ADR at $1.61 $0.88 $1.29 -32% -Diluted per ADR at $1.45 $0.79 $1.16 -32% Earnings per share before goodwill: -Basic 20.5p 36.3p -44%
Slide 11: Operating Profit – 2002 V. 2001
Operating Profit – 2002 V. 2001 in thousands 2002 2001 Change Managed Products £ 322,565 £ 436,471 £ (113,906) INVESCO Institutional 49,334 53,552 (4,218) INVESCO Global 33,904 76,422 (42,518) INVESCO Retirement 4,059 4,977 (918) Private Wealth Management 1,796 1,239 557 New Business (12,048) (10,21
Slide 12: Organizational Structure Effective Jan 1, 2003
Organizational Structure Effective Jan 1, 2003 in thousands Year 2002 Dec 31, 2002 Revenue Expenses Op. Profit FUM* Headcount** AIM US £487,956 £ (281,350) £206,606 $124.4 2,246 Canada 151,345 (73,702) 77,643 22.0 918 639,301 (355,052) 284,249 146.4 3,164 INVESCO US 333,457 (244,614) 88,843 123.2 1,
Slide 13: Funds Under Management - YTD 2002
Funds Under Management - YTD 2002 in billions Managed Products INVESCO INVESCO Private Total AIM INVESCO Inst Global Wealth December 31, 2001 $397.9 $179.8 $31.4 $116.8 $60.0 $9.9 Market gains/(loss) (50.8) (23.6) (7.9) (8.4) (9.3) (1.6) Net new (lost) business (14.2) (3.7) (3.3) (5.7) (1.3) (0.2) C
Slide 14: Funds Under Management – Q4 2002
Funds Under Management – Q4 2002 in billions Managed Products INVESCO INVESCO Private Total AIM INVESCO Inst Global Wealth September 30, 2002 $323.6 $138.4 $19.6 $102.4 $55.0 $8.2 Market gains/(losses) 9.4 3.7 1.0 3.6 0.9 0.2 Net new/(lost) business (7.2) (1.0) (0.9) (3.1) (2.0) (0.2) Change in mone
Slide 15: Funds Under Management – YTD
Funds Under Management – YTD AIM INVESCO PWM/ Total US Canada US UK Europe/Asia Retirement December 31, 2001 $397.9 $157.7 $22.1 $148.8 $38.1 $21.8 $9.4 Market gains/(loss) (50.8) (21.5) (2.1) (16.3) (6.8) (2.5) (1.6) Net new (lost) business (14.2) (5.4) 1.7 (9.0) (1.3) (0.1) (0.1) Change in Money M
Slide 16: Balance Sheet
Balance Sheet Dec 31, 2002 Dec 31, 2001 Fixed assets Goodwill £2,542,306 £2,696,045 Investments 248,408 224,282 Tangible assets 197,060 213,579 2,987,774 3,133,906 Currents assets Debtors 725,547 882,516 Investments 69,195 81,495 Cash 355,111 350,978 1,149,853 1,314,989 Current Liabilitites Current
Slide 17: Group Cash Flow
Group Cash Flow Year Ended Dec 31, 2002 Dec 31, 2001 Operating profit £148,262 £325,886 Amortization and depreciation 209,647 207,102 Change in debtors, creditors and other 68,609 10,245 Net cash inflow from operating activities 426,518 543,233 Interest paid, net of investment income (41,558) (45,59
Slide 18: Analysis Of Net Debt
Analysis Of Net Debt in thousands December 31, 2002 December 31, 2001 (Decrease)/Increase £ $ £ $ £ $ Senior notes ($250m) 155,280 250,000 172,414 250,000 (17,134) - Senior notes ($700m) 434,783 700,000 482,759 700,000 (47,976) - Credit facility 149,916 241,364 106,919 155,032 42,997 86,332 Equity s
Slide 19: Average Shares Outstanding
Average Shares Outstanding in thousands Dec 31, Sept 30, Dec 31, 2002 2002 2001 Ordinary shares 771,692 772,192 763,977 Exchangeable shares 38,350 39,130 41,084 Shares outstanding 810,042 811,322 805,061 Shares reserved for: Options 9,476 11,261 24,922 Total shares 819,518 822,583 829,983 19
Slide 20: US GAAP Reconciliation (Profit)
US GAAP Reconciliation (Profit) in thousands Year Ended Dec 31, 2002 2001 Net profit under UK GAAP £ 16,893 £154,803 US GAAP adjustments: Acquisition accounting 137,790 (35,538) Redundancy and reorganizations 11,961 - Taxation (5,198) (40,539) Other 420 1,495 Net income under US GAAP £161,866 £ 80,2
Slide 21: US GAAP Reconciliation (Equity)
US GAAP Reconciliation (Equity) in thousands Dec 31, 2002 Dec 31, 2001 Shareholders' funds under UK GAAP £ 2,283,488 £ 2,281,464 US GAAP adjustments: Acquisition accounting 1,034,168 984,436 Redundancy and reorganizations 11,961 - Treasury stock (162,104) (97,580) Dividends 52,656 52,708 Other (11,9
Slide 22: 2002 Year End Results
AMVESCAP 2002 Year End Results