Invesco Ltd · NYSE:IVZ
Invesco — Q1 2016 Earnings Presentation
44 slides from Invesco's earnings presentation, Apr 28, 2016
Slide 1: Invesco first quarter 2016 results
Invesco first quarter 2016 results Martin L. Flanagan President and Chief Executive Officer Loren M. Starr Chief Financial Officer April 28, 2016
Slide 2: Forward-looking statements
Forward-looking statements This presentation, and comments made in the associated conference call today, may include “forward-looking statements.” Forward-looking statements include information concerning future results of our operations, expenses, earnings, liquidity, cash flow and capital expendit
Slide 3: Discussion topics
Discussion topics First quarter overview Investment performance and flows Financial results Questions Appendix 2
Slide 4: First quarter overview
First quarter overview Continued strong investment performance and our focus on meeting client needs contributed to active long-term inflows and solid operating results despite volatile markets Maintained strong, long-term investment performance – 72% and 76% of actively managed assets in top half
Slide 5: Summary of first quarter 2016 results
Summary of first quarter 2016 results Assets under March 31, 2016, AUM of $771.5 billion, versus $775.6 billion at management December 31, 2015 Average AUM was $747.5 billion, versus $783.7 billion for the fourth quarter of 2015 Flows Long-term net outflows of $1.3 billion Total net outflows
Slide 6: Discussion topics
Discussion topics First quarter overview Investment performance and flows Financial results Questions Appendix 5
Slide 7: Investment performance – overview
Investment performance – overview Aggregate performance analysis – asset weighted Percent of actively managed assets in top half of peer group* 1-Year 3-Year 5-Year 59% 72% 76% 28% 24% 41% Assets top half of peer group Assets bottom half of peer group * Excludes passive products, closed-end funds, p
Slide 8: Quarterly long-term flows
Quarterly long-term flows Positive active flows during a volatile quarter Quarterly long-term flows ($ billions) Total Active Passive 50.5 52.1 40.6 43.1 46.0 42.5 44.4 43.5 43.0 42.8 36.1 36.2 36.4 36.7 33.2 32.9 9.6 9.9 9.8 9.9 9.0 8.2 6.8 6.4 10.3 6.8 3.5 6.0 6.0 5.4 2.5 5.9 0.9 3.5 3.9 0.5 1.1 1
Slide 9: Quarterly long-term flows
Quarterly long-term flows Strong institutional demand offset by retail volatility Quarterly long-term flows ($ billions) Retail(a) Institutional(b) 17.9 40.3 36.3 34.8 35.7 34.2 32.0 32.6 33.1 11.5 10.4 10.3 10.2 9.7 9.6 6.2 6.4 4.8 7.5 3.9 2.8 1.2 1.7 1.3 1.4 0.8 0.0 0.3 -0.5 -2.7 -8.2 -4.2 -7.4 -6
Slide 10: Discussion topics
Discussion topics First quarter overview Investment performance and flows Financial results Questions Appendix 9
Slide 11: Total assets under management – 1Q16 vs. 4Q15
Total assets under management – 1Q16 vs. 4Q15 ($ billions) 1Q-16 4Q-15 % Change Beginning Assets $775.6 $755.8 2.6% Long-Term Inflows 42.8 43.0 (0.5)% Long-Term Outflows (44.1) (39.1) 12.8% Long-Term Net flows (1.3) 3.9 N/A Net flows in Invesco PowerShares QQQ (2.6) 2.0 N/A Net flows in Inst. Money
Slide 12: Non-GAAP operating results – 1Q16 vs. 4Q15
Non-GAAP operating results – 1Q16 vs. 4Q15 ($ millions) 1Q-16 4Q-15 % Change Adjusted Revenues Investment Management Fees 930 1,009 (7.8)% Service and Distribution Fees 198 208 (4.8)% Performance Fees 16 19 (17.6)% Other 24 29 (17.2)% Third-Party Distribution, Service and Advisory Expenses (349) (37
Slide 13: First quarter overview
First quarter overview Continued strong investment performance and our focus on meeting client needs contributed to active long-term inflows and solid operating results despite volatile markets Maintained strong, long-term investment performance – 72% and 76% of actively managed assets in top half
Slide 14: Discussion topics
Discussion topics First quarter overview Investment performance and flows Financial results Questions Appendix 13
Slide 15: Discussion topics
Discussion topics First quarter overview Investment performance and flows Financial results Questions Appendix 14
Slide 16: We are diversified as a firm
We are diversified as a firm Delivering a diverse set of solutions to meet client needs By client domicile By channel By asset class 3% 14% 13% 66% 66% 24% 34% 10% 47% 8% 9% 6% 1-Yr 1-Yr 1-Yr ($ billions) Change ($ billions) Change ($ billions) Change U.S. $507.5 (4.7)% Retail $507.7 (6.1)% Equity $
Slide 17: Investment performance by investment objective
Investment performance By investment objective (actively managed assets)* Equities AUM above benchmark 1st quartile 2nd quartile U.S. Core U.S. Growth U.S. Value Sector 100% 100% 100% 100% 27% 69% 35% 33% 1% 32% 27% 27% 27% 27% 29% 29% 35% 24% 27% 29% 25% 12% 16% 18% 1% 3% 6% 5% 12% 6% 8% 6% 6% 2% 1
Slide 18: Investment performance by investment objective (continued)
Investment performance By investment objective (actively managed assets)* (CONTINUED) Equities Other AUM above benchmark 1st quartile 2nd quartile Global Global ex-U.S. and Em. Mkts. Alternatives Balanced 100% 100% 100% 100% 97% 99% 90% 26% 84% 53% 65% 69% 69% 8% 60% 99% 63% 59% 98% 37% 45% 90% 51%
Slide 19: Investment performance (5-year) by investment objective
Investment performance (5-year) By investment objective (actively managed assets)* Percentages in parentheses represent % AUM of each investment objective as a ratio of all objectives (Total ranked AUM of $435.8 billion) % of assets top % of assets bottom Equities half of peer group half of peer gro
Slide 20: Investment performance (5-year) by investment objective (continued)
Investment performance (5-year) By investment objective (actively managed assets)* (CONTINUED) Percentages in parentheses represent % AUM of each investment objective as a ratio of all objectives (Total ranked AUM of $435.8 billion) % of assets top % of assets bottom Equities Other half of peer grou
Slide 21: Impact of Foreign Exchange on Non-GAAP operating results
Impact of Foreign Exchange on Non-GAAP operating results Amounts represent impact of change in average exchange rate from prior period used to translate non-USD earnings. ($ millions) 1Q-16 vs 4Q-15 1Q-16 vs. 1Q-15 Investment Management Fees (16.1) (24.0) Service and Distribution Fees (0.2) (0.7) Pe
Slide 22: Non-GAAP operating results– quarterly
Non-GAAP operating results– quarterly ($ millions) 1Q-16 4Q-15 % Change* 3Q-15 2Q-15 1Q-15 4Q-14 3Q-14 2Q-14 Investment Management Fees 930 1,009 (7.8)% 1,038 1,083 1,024 1,033 1,071 1,055 Service and Distribution Fees 198 208 (4.8)% 215 220 213 218 222 215 Performance Fees 16 19 (17.6)% 18 13 52 19
Slide 23: US GAAP operating results – quarterly
US GAAP operating results – quarterly ($ millions) 1Q-16 4Q-15 % Change* 3Q-15 2Q-15 1Q-15 4Q-14 3Q-14 2Q-14 Investment Management Fees 914 987 (7.4)% 1,017 1,056 1,001 1,010 1,047 1,032 Service and Distribution Fees 198 208 (4.8)% 215 220 213 218 222 215 Performance Fees 15 17 (13.7)% 16 7 47 17 8
Slide 24: Total assets under management – quarterly
Total assets under management – quarterly ($ billions) 1Q-16 4Q-15 % Change 3Q-15 2Q-15 1Q-15 Beginning Assets $775.6 $755.8 2.6% $803.6 $798.3 $792.4 Long-Term Inflows 42.8 43.0 (0.5)% 43.5 52.1 50.5 Long-Term Outflows (44.1) (39.1) 12.8% (47.4) (46.2) (40.2) Long-Term Net flows (1.3) 3.9 N/A (3.9)
Slide 25: Total assets under management – by asset class
Total assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Alternatives Income Market September 30, 2015 $755.8 $352.4 $185.5 $50.1 $66.8 $101.0 Long-Term Inflows 43.0 21.3 11.0 2.8 0.7 7.2 Long-Term Outflows (39.1) (21.0) (8.0) (4.1) (1.0) (5.0) Long-Term Net flow
Slide 26: Total assets under management – by asset class
Total assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Alternatives Income Market March 31, 2015 $798.3 $392.8 $184.4 $50.6 $70.2 $100.3 Long-Term Inflows 52.1 23.8 13.2 6.0 1.0 8.1 Long-Term Outflows (46.2) (26.4) (8.7) (3.1) (1.0) (7.0) Long-Term Net flows 5.
Slide 27: Total assets under management – by channel
Total assets under management – by channel ($ billions) Total Retail Institutional September 30, 2015 $755.8 $499.4 $256.4 Long-Term Inflows 43.0 32.6 10.4 Long-Term Outflows (39.1) (32.6) (6.5) Long-Term Net flows 3.9 - 3.9 Net flows in Invesco PowerShares QQQ 2.0 2.0 - Net flows in Inst. Money Mar
Slide 28: Total assets under management – by channel
Total assets under management – by channel ($ billions) Total Retail Institutional March 31, 2015 $798.3 $540.7 $257.6 Long-Term Inflows 52.1 34.2 17.9 Long-Term Outflows (46.2) (34.7) (11.5) Long-Term Net flows 5.9 (0.5) 6.4 Net flows in Invesco PowerShares QQQ (0.3) (0.3) - Net flows in Inst. Mone
Slide 29: Total assets under management – by client domicile
Total assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe September 30, 2015 $755.8 $499.7 $21.8 $103.1 $74.1 $57.1 Long-Term Inflows 43.0 25.0 0.8 3.7 7.3 6.2 Long-Term Outflows (39.1) (25.2) (1.2) (3.4) (6.6) (2.7) Long-Term Net flows 3.9 (0.2)
Slide 30: Total assets under management – by client domicile
Total assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe March 31, 2015 $798.3 $532.6 $24.9 $106.3 $74.2 $60.3 Long-Term Inflows 52.1 27.4 1.0 4.5 9.7 9.5 Long-Term Outflows (46.2) (24.5) (1.1) (4.3) (8.1) (8.2) Long-Term Net flows 5.9 2.9 (0.1)
Slide 31: Passive assets under management – by asset class
Passive assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Alternative Income Market September 30, 2015 $131.7 $82.3 $39.7 - $0.1 $9.6 Long-Term Inflows 9.8 7.7 1.4 - - 0.7 Long-Term Outflows (9.4) (6.2) (2.3) - - (0.9) Long-Term Net flows 0.4 1.5 (0.9) - - (0.2)
Slide 32: Passive assets under management – by asset class
Passive assets under management – by asset class ($ billions) Total Equity Fixed Balanced Money Income Market Alternative March 31,2015 $143.0 $90.0 $42.0 - - $11.0 Long-Term Inflows 9.0 6.3 1.6 - - 1.1 Long-Term Outflows (8.5) (6.2) (1.0) - - (1.3) Long-Term Net flows 0.5 0.1 0.6 - - (0.2) Net flow
Slide 33: Passive assets under management – by channel
Passive assets under management – by channel ($ billions) Total Retail Institutional September 30, 2015 $131.7 $110.6 $21.1 Long-Term Inflows 9.8 9.8 - Long-Term Outflows (9.4) (8.2) (1.2) Long-Term Net flows 0.4 1.6 (1.2) Net flows in Invesco PowerShares QQQ 2.0 2.0 - Net flows in Inst. Money Marke
Slide 34: Passive assets under management – by channel
Passive assets under management – by channel ($ billions) Total Retail Institutional March 31, 2015 $143.0 $120.8 $22.2 Long-Term Inflows 9.0 7.6 1.4 Long-Term Outflows (8.5) (7.6) (0.9) Long-Term Net flows 0.5 - 0.5 Net flows in Invesco PowerShares QQQ (0.3) (0.3) - Net flows in Inst. Money Market
Slide 35: Passive assets under management – by client domicile
Passive assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe September 30, 2015 $131.7 $127.5 $0.4 - $1.8 $2.0 Long-Term Inflows 9.8 9.7 - - 0.1 - Long-Term Outflows (9.4) (9.2) - - (0.2) - Long-Term Net flows 0.4 0.5 - - (0.1) - Net flows in Inves
Slide 36: Passive assets under management – by client domicile
Passive assets under management – by client domicile ($ billions) Total U.S. Canada U.K. Continental Asia Europe March 31, 2015 $143.0 $139.0 $0.3 - $1.8 $1.9 Long-Term Inflows 9.0 8.1 0.1 - 0.1 0.7 Long-Term Outflows (8.5) (7.7) - - (0.1) (0.7) Long-Term Net flows 0.5 0.4 0.1 - - - Net flows in Inv
Slide 37: Reconciliation of US GAAP to non-GAAP – three months ended March 31, 2016
Reconciliation of US GAAP results to non-GAAP results – three months ended March 31, 2016 Please refer to pages 22-26 in the 1Q 2016 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAAP C
Slide 38: Reconciliation of US GAAP to non-GAAP – three months ended December 31, 2015
Reconciliation of US GAAP results to non-GAAP results – three months ended December 31, 2015 Please refer to pages 22-26 in the 4Q 2015 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAA
Slide 39: Reconciliation of US GAAP to non-GAAP – three months ended September 30, 2015
Reconciliation of US GAAP results to non-GAAP results – three months ended September 30, 2015 Please refer to pages 19-22 in the 3Q 2015 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GA
Slide 40: Reconciliation of US GAAP to non-GAAP – three months ended June 30, 2015
Reconciliation of US GAAP results to non-GAAP results – three months ended June 30, 2015 Please refer to pages 19-22 in the 2Q 2015 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAAP Co
Slide 41: Reconciliation of US GAAP to non-GAAP – three months ended March 31, 2015
Reconciliation of US GAAP results to non-GAAP results – three months ended March 31, 2015 Please refer to pages 18-21 in the 1Q 2015 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAAP C
Slide 42: Reconciliation of US GAAP to non-GAAP – three months ended December 31, 2014
Reconciliation of US GAAP results to non-GAAP results – three months ended December 31, 2014 Please refer to pages 22-26 in the 4Q 2014 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GAA
Slide 43: Reconciliation of US GAAP to non-GAAP – three months ended September 30, 2014
Reconciliation of US GAAP results to non-GAAP results – three months ended September 30, 2014 Please refer to pages 19-22 in the 3Q 2014 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party Acquisition Market appreciation / Consolidated Other Non-GA
Slide 44: Reconciliation of US GAAP to non-GAAP – three months ended June 30, 2014
Reconciliation of US GAAP results to non-GAAP results – three months ended June 30, 2014 Please refer to pages 19-22 in the 2Q 2014 earnings press release for a description of the adjustments ($ millions) US GAAP Proportional 3rd party distribution, Acquisition Market appreciation / Consolidated Non