NAOS Ex-50 Opportunities Co. Ltd. · ASX:NAC
NAOS Ex-50 Opportunities — Q4 FY21 Earnings Presentation
40 slides from NAOS Ex-50 Opportunities's earnings presentation, Jul 29, 2021
Slide 1: ASX announcement cover letter
NAOS Ex-50 Level 34, MLC Centre OPPORTUNITIES 19 Martin Place COMPANY LIMITED Sydney NSW 2000 (ASX: NAC) T (02) 9002 1576 ABN 49 169 448 837 F (02) 8215 0037 E enquiries@naos.com.au www.naos.com.au For personal use only 29 July 2021 ASX Market Announcements ASX Limited 20 Bridge Street Sydney NSW 20
Slide 2: Q4 FY21 Investor Update & Q&A
Q4 FY21 For personal use only INVESTOR UPDATE & Q&A Thursday 29 July 2021 | 10:30 am (AEST) Audio Dial In: +61 2 8355 1054 Audio Access Code: 215-452-238 PRESENTED BY NAOS ASSET MANAGEMENT CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 1
Slide 3: Important information
Important information For personal use only This material has been prepared by NAOS Asset Management Limited (ABN 23 107 624 126, AFSL 273529) (NAOS) for general information purposes only and must not be construed as investment advice. It does not constitute an offer to purchase any security or fina
Slide 4: NAOS Asset Management
NAOS Asset Management Our Mission For personal use only To provide investors genuine long-term, concentrated exposure to Australian undervalued emerging companies with an industrial focus. NAOS established its first Listed Investment Company (LIC) in 2013 with 400 shareholders, today NAOS manages ~$
Slide 5: NAOS investment beliefs provide a competitive advantage
NAOS investment beliefs provide a competitive advantage For personal use only Value with Long Quality over Invest for the Term Growth Quantity Long Term 5+ years Performance v Ignore the Pure Exposure Liquidity Focus Index to Industrials The closed end LIC structure removes application and redemptio
Slide 6: Reasons not to invest with NAOS
Reasons not to invest with NAOS Our LICs are not for everyone. Some reasons why you may not choose to invest with NAOS For personal use only include: Concentrated portfolios (0-15 investments) Long-term investment philosophy (5+ years) Focus on smaller companies ($20 million - $500 million)
Slide 7: NAOS LICs investment portfolio financial year returns
NAOS LICs investment portfolio financial year returns* For personal use only 60% 50% 40% 30% 20% 10% 0% -10% -20% FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 NAOS Emerging Opportunities Company Limited (ASX: NCC) NAOS Ex-50 Opportunities Company Limited (ASX: NAC) NAOS Small Cap Opportunities Compa
Slide 8: NAOS LIC Fully Franked Dividend History and Profit Reserves
NAOS LIC Fully Franked Dividend History and Profit Reserves Each LIC has consistently paid dividends and holds healthy profit reserves For personal use only 80 75.70 70 60 56.00 53.75 48.00 Cents per share (CPS) 50 45.29 40 31.70 30 24.64 21.40 20 17.25 10 0 NCC NAC NSC Total Dividends Declared (Sin
Slide 9: Investment portfolio performance summary
Investment portfolio performance summary For personal use only BENCHMARK Investment Portfolio 1 YEAR 1 YEAR BENCHMARK INCEPTION (P.A.) INCEPTION PERFORMANCE PERFORMANCE (P.A) NAC Investment Portfolio Performance* +63.36% +27.93%^ +17.72% +8.53%^ NCC Investment Portfolio Performance* +48.34% +33.23%^
Slide 10: What research does NAOS apply to the Investment Process?
What research does NAOS apply to the Investment Process? The NAOS Investment Team undertakes fundamental analysis on potential and current investments. Some For personal use only examples of our key focus areas include: Internal Engagement External Engagement Hands On Research Executive Team includi
Slide 11: Summary of Q4 FY21
Summary of Q4 FY21 Q4 FY21 performance was strong across all of the NAOS LICs with NCC +13.78%, NSC For personal use only +13.62% and NAC +15.92%. Capital management initiatives during Q4 FY21 included: NSC conducted a 1 for 3 bonus options issue NCC convertible notes offer completed NCC,
Slide 12: Summary of Q4 FY21 continued: Global Index Returns
Summary of Q4 FY21 continued For personal use only Global Index Returns as at June 30, 2021 NASDAQ MSCI Emerging Markets S&P 500 MSCI World Index S&P Europe 350 (USD) Nikkei 225 ASX 200 Shanghai Composite FTSE 100 -5.00% 0.00% 5.00% 10.00% 15.00% 20.00% 25.00% 30.00% 35.00% 40.00% 45.00% 50.00% 3 mo
Slide 13: Summary of Q4 FY21 continued
Summary of Q4 FY21 continued Removal of some short-term stimulus measures (JobKeeper and JobSeeker programs ended For personal use only in March) resulted in Q4 being the most ‘normal’ quarter since the impact of COVID-19. Whilst the larger stimulus measures have been tapered or removed, smaller
Slide 14: Summary of Q4 FY21 continued: commodity prices
Summary of Q4 FY21 continued For personal use only 52 Week High/Low % Price Change Lumber (IOM) Iron Ore 62% FE (NYMEX) Butter - Grade AA (CME) Crude Oil - WTI (ICE) Copper - High Grade (COMEX) Coffee (NYMEX) Cotton #2 (ICE) Silver (COMEX) Wheat (CBOT) Rubber - Natural (SHFE) Plastics - Polyethylene
Slide 15: Welcome Jim Bindon
Welcome Jim Bindon For personal use only Jim Bindon Managing Director, Big River Industries Ltd CONVICTION. LONG TERM. ALIGNED | Copyright 2021 2019 NAOS Asset Management Limited 14
Slide 16: Big River
Big River • Big istoday River one of Australia’s leading manufacturers and distributors of specialty timber and building products, diversified by geography, industry segment, construction type and customers with >8,500 active trading accounts For personal use only 21 Sales and distribution sites Big
Slide 17: Positive construction cycle metrics
Positive construction cycle metrics For personal use only 250 $b total construction activity 200 150 100 50 0 2008 Peak 2017 Peak 2021 actual 2024 (f) Peak • Population grew 16% between 2008 and 2017 cycle peaks. • Australian population is forecast to be 10% higher than 2017 by the next expected (20
Slide 18: Supply constraints affecting the industry
Supply constraints affecting the industry For personal use only Detached housing trends Volumes (‘000m3) of key structural 160 timber 140 4000 3500 120 3000 100 2500 80 2000 60 1500 40 1000 500 20 0 0 2019/20 2020/21 2021/22 2022/23 2019/20 2020/21 2021/22 2022/23 Manufactured imported Approvals Sta
Slide 19: NCC key portfolio events Q4 FY21
NCC key portfolio events Q4 FY21 HOLDING INDUSTRY Q4 UPDATE For personal use only Quarterly results saw milestone achieved of >$1bn FUM and is cash flow positive. Financial Services Outsourced the last of their internally managed investment products. Transition to pure play distribution platfo
Slide 20: NCC overview as at June 2021
NCC overview as at 30 June 2021 For personal use only $1.23 7.00% $1.035 14 13.44% 48.34% $134.8m Pre-Tax Fully Franked Share Price Number of Performance 1 Year Weighted NTA Dividend Yield Holdings since Performance ^ Average Market Inception^ p.a. Capitalisation of the Investments FULLY FRANKED DIV
Slide 21: NSC key portfolio events Q4 FY21
NSC key portfolio events Q4 FY21 HOLDING INDUSTRY Q4 UPDATE For personal use only Q3 trading update released with strong momentum continuing despite being a seasonally quiet period. Financial Federal government instant asset write off announcement to continue to Services provide tailwinds along
Slide 22: NSC overview as at June 2021
NSC overview as at 30 June 2021 For personal use only $1.10 4.85% $0.98 15 8.98% 58.40% $206.2m Pre-Tax Fully Franked Share Price Number of Performance 1 Year Weighted NTA Dividend Yield Holdings since Performance ^ Average Market Inception^ p.a. Capitalisation of the Investments FULLY FRANKED DIVID
Slide 23: NAC key portfolio events Q4 FY21
NAC key portfolio events Q4 FY21 HOLDING INDUSTRY Q4 UPDATE For personal use only Became a substantial holding within the quarter. Exited position in Peet Ltd (ASX: PPC) at a profit. Real Estate TOT/TGP continued to increase stake in Irongate (ASX:IAP) from ~9% to >19% (ASX: TOT) Buoyant mar
Slide 24: NAC overview as at June 2021
NAC overview as at 30 June 2021 For personal use only $1.59 4.58% $1.18 14 17.72% 63.36% $541.4m Pre-Tax Fully Franked Share Price Number of Performance 1 Year Weighted NTA Dividend Yield Holdings since Performance ^ Average Market Inception^ p.a. Capitalisation of the Investments FULLY FRANKED DIVI
Slide 25: Capital Management Initiatives
Capital Management Initiatives Performance • Maintain a focus on long term performance without deviating from the NAOS investment philosophy. For personal use only • Continue to focus on a growing stream of dividends, franked to the maximum extent possible, whilst maintaining an Dividends adequate r
Slide 26: Key business & industry traits for maximising long-term performance
Key business & industry traits for maximising long-term performance and reducing the risk of permanent capital loss events For personal use only A growing revenue base provides companies with a number of competitive advantages such as the Industry Tailwinds Supporting Long Term ability to scale thei
Slide 27: Overview and Outlook Q1 FY22
Overview and Outlook Q1 FY22 For personal use only Updates from almost all portfolio companies in August reporting season. Reporting season will provide excellent insights into the level of resilience and quality of earnings for core investments during the COVID recovery to date. We expect that
Slide 28: Overview and Outlook Q1 FY22 continued
Overview and Outlook Q1 FY22 continued For personal use only Aside from reporting season, we believe there are numerous significant catalysts that may occur for investments held within the portfolios, examples include: SND – Potential contract wins following decision on which developments will r
Slide 29: NAOS Asset Management 1% Pledge
NAOS Asset Management 1% Pledge For personal use only As a company, we commit to Pledge 1% of revenue, time and intellect to movements and missions that matter. 1% Revenue 1% Time 1% Intellect Each year NAOS donates 1% of its annual Our people have an incredible range of skills NAOS sees the value i
Slide 30: Q&A
Q&A For personal use only Thank you for your continued support. “Games are won by players who focus on the playing field - not by those whose eyes are glued to the scoreboard.” Warren Buffett CONVICTION. LONG TERM. ALIGNED | Copyright 2021 2019 NAOS Asset Management Limited 29
Slide 31: Appendix
APPENDIX For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2019 NAOS Asset Management Limited 30
Slide 32: NAOS strong long term risk-adjusted returns
NAOS strong long term (5 years+) risk-adjusted returns * For personal use only NCC Investment Portfolio Risk and Performance Metrics NAC Investment Portfolio Risk and Performance Metrics 15% 20% 13.44% 17.72% 15% 10% 7.58% 10% 8.53% 5% 3.49% 2.77% 5% 2.96% 2.70% 0% 0% -1.12% -0.63% -3.28% -2.94% -5%
Slide 33: The features of a NAOS LIC
The features of a NAOS LIC For personal use only Closed-end structure Long-term Intra-day Liquidity No applications or Investment decisions Trades on the ASX redemptions Corporate Governance Dividends Opportunity Public companies provide A growing stream of May trade at a discount or accountability
Slide 34: NAOS Listed Investment Companies
NAOS Listed Investment Companies Each of our LICs target a concentrated portfolio of 0-20 companies For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2021 2019 NAOS Asset Management Limited 33
Slide 35: NAOS management alignment
NAOS management alignment NAOS Director’s shareholdings have significantly increased since the inception of each LIC For personal use only Inception Directors Shareholding (Ordinary Shares) 30 June 2021 Directors Shareholding (Ordinary Shares) 9,000,000 8,123,267 8,000,000 7,000,000 6,000,000 5,057,
Slide 36: NAOS investment process
NAOS investment process For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2021 2019 NAOS Asset Management Limited 35
Slide 37: NAOS ESG framework
NAOS ESG framework For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2021 2019 NAOS Asset Management Limited 36
Slide 38: Historical shareholder numbers
Historical shareholder numbers For personal use only 7500 5000 2500 0 NCC Shareholders NAC Shareholders NSC Shareholders CONVICTION. LONG TERM. ALIGNED | Copyright 2021 2019 NAOS Asset Management Limited 37
Slide 39: Investor awareness and communication
Investor awareness and communication For personal use only CEO Insights, NAOS Quarterly Monthly Investment The news and media Newsletter, Webinars Report & NTA email section of our website subscribe via our updates, subscribe via is updated regularly website our website naos.com.au naos.com.au/ naos
Slide 40: NAOS Directors and Team
NAOS Directors and Team OUR For personal use only DIRECTORS Sebastian Evans Warwick Evans Matthew Hyder David Rickards Sarah Williams Mark Bennett Trevor Carroll Managing Director, NAOS Chairman, NAOS Asset Director, NAOS Asset Independent Chairman & Independent Director, Director, NAOS Asset Indepe
NAOS Ex-50 Opportunities Company — Q4 FY21 Earnings Presentation on 6ix