Pacific Current Group Ltd · ASX:PAC
Pacific Current — Shareholder Meeting (November 2017)
24 slides from Pacific Current's shareholder meeting presentation, Nov 1, 2017
Slide 1: Annual General Meeting
Annual General Meeting Presenters Mike Fitzpatrick, Chairman Paul Greenwood, President, North America and Global CIO Joseph Ferragina, Chief Financial Officer and COO A S X : PA C 1 November 2017
Slide 2: Disclaimer
Disclaimer The information in this presentation is general information about Pacific Current Group and is current only at the date of this presentation. In particular, this presentation: ❯ is not an offer or recommendation to purchase or subscribe for securities in Pacific Current Group Limited, nor
Slide 3: Agenda
Agenda 1. Chairman’s Address 2. Business Overview 3. FY17 Results 4. Formal Items of Business 5. Questions 6. Formal Items of Business (continued) 7. Close of Meeting ASX: PAC // 3
Slide 4: Chairman's Remarks
Chairman’s Remarks Mike Fitzpatrick, Chairman ASX: PAC // 4
Slide 5: Chairman's Overview
Chairman’s Overview ❯ Last year we stated that the focus of FY17 would be on: • Further cost reduction • Maximizing cash flows through organic growth • Simplifying our structure • Strengthening our balance sheet ❯ These objectives were largely met during the year and PAC is now a much stronger compa
Slide 6: Chairman's Overview
Chairman’s Overview ❯ Given progress in FY17, PAC now faces more “normal course” type challenges ❯ Our focus in FY18 will be on: • Deploying capital into attractive new investments • Continuing efforts to increase growth of partner boutiques • Solidifying management structure and fine-tuning operati
Slide 7: Business Overview
Business Overview Paul Greenwood, President North America & CIO ASX: PAC // 7
Slide 8: Business Overview – A Year of Progress
Business Overview – A Year of Progress PAC succeeded in reducing costs and simplifying a complex structure ❯ Organizational Efficiency • Headcount has gone from 32 to 19 in FY17 • Downsized all office locations • Focused on driving professional services expense lower ❯ Simplification • All sharehold
Slide 9: Business Overview – A Year of Progress
Business Overview – A Year of Progress Strong organic growth and a much improved balance sheet ❯ Balance Sheet • During the year ended 30 June 2017, balance sheet materially strengthened through a A$39.5m reduction in liabilities, which was aided by a A$33m equity issuance in June 2017 • Post 30 Jun
Slide 10: Key FY17 Portfolio Developments
Key FY17 Portfolio Developments FY17 saw FUM acceleration for many PAC boutiques ❯ Strong organic growth across the portfolio: • GQG – One of the fastest growing start-ups in the history of the investment management industry • Aperio – Experiencing consistently large inflows, with FUM up significant
Slide 11: Sale of IML
Sale of IML PAC agreed to sell its interest in IML in early October ❯ Our investment in IML was a huge success, with earnings and sale proceeds exceeding 31 times our initial investment ❯ In situations where management wants to sell, we are generally inclined to support them, though sometimes we hav
Slide 12: FUM Update
FUM Update* As at 30 September 2017 ❯ GQG continues its rapid growth 30-Sep- Boutique & FX 30-Jun-17 Other 17 Channel Split Net Flows Impact ❯ EAM FUM grew 77% during Closing FUM (1) Closing (A$bn) (2) FUM the quarter, while ROC also Core Boutiques posted sizeable gains Retail 9.61 0.74 (0.22) (0.01
Slide 13: Capital Management Plan
Capital Management Plan ❯ Our pipeline of attractive investments vastly exceeds our investable capital, so no special dividend is being considered until we have better visibility on how much capital we expect to deploy in FY18 ❯ It is our expectation that we will make additional investments in FY18
Slide 14: Current Pipeline
Current Pipeline We have a large, diversified pipeline of attractive opportunities ❯ Our pipeline reflects the size, quality, and diversification we seek to add to the portfolio ❯ As a reminder, we invest across the risk / return continuum • Yielding growth investments – larger, profitable companies
Slide 15: Outlook
Outlook ❯ While markets will always be unpredictable, we are positive about the prospects for continued growth among our boutiques and quite optimistic that we will be able to deploy available cash in highly attractive investments. Moreover, we are certain that we have a team capable of executing ou
Slide 16: FY17 Financial Results
FY17 Financial Results Joe Ferragina ASX: PAC // 16
Slide 17: FY17 Financial Results Summary
FY17 Financial Results Summary » Total FUM of boutiques reaches A$62bn FUM » Core boutiques: A$45.3bn A$62bn* » Growth boutiques: A$14.2bn » Other boutiques: A$2.5bn NPAT A$16.6m** 43.1% » Underlying Net Profit After Tax of A$16.6m, up 43.1% from A$11.6m in FY16 A$10.6m statutory NPBT A$17.3m** 220.
Slide 18: Overview of PAC
Overview of PAC The simplification and restructure resulted in PAC owning 100% of the Aurora Trust Aurora Trust Core Boutiques Growth Boutiques Other Boutiques Global equity China ETF index provider Real assets fund of funds International small cap Australian small cap Customised tax managed equity
Slide 19: Boutique Results – Core Boutiques
Boutique Results Core Boutiques Key Metrics Real assets fund of funds FY2016 FY2017 FUM as at 30 June* A$41.1b A$45.3b Customised tax managed equity Revenue for the full year* A$137.6m A$154.6m Australian equities Earnings to the Group** A$30.3m A$33.7m Global listed infrastructure » FY2016 has been
Slide 20: Boutique Results – Growth Boutiques
Boutique Results Growth Boutiques Key Metrics FY2016 FY2017 Global equity FUM as at 30 June* A$6.7b A$14.2b International small cap Revenue for the full year* A$22.1m A$22.1m Global and emerging Earnings to the Group** A$0.7m A$0.3m equities » FY2016 includes Raven, which was sold in October 2016 Pr
Slide 21: Boutique Results – Other Boutiques
Boutique Results Other Boutiques Key Metrics China ETF index provider FY2016 FY2017 FUM as at 30 June* A$2.6b A$2.5b Australian small cap Australian REIT Revenue for the full year* A$11.8m A$16.8m & unlisted property Japan small cap & EM equities Earnings to the Group** A$0.1m A$1.3m Private equity
Slide 22: Underlying Financial Results of PAC
Underlying Financial Results of PAC Pro forma PAC P&L on a ‘look through’ basis as if the Aurora Trust was 100% owned by PAC PAC ❯ The corresponding table shows pro forma PAC P&L for P&L Highlights (A$m) Pro forma FY17 FY17, which has been adjusted to gross significant revenue and expense items of P
Slide 23: Decrease in pro forma underlying expenses
Decrease in pro forma underlying expenses Significant reduction in corporate costs and interest expense has improved operating leverage Corporate cost reductions A$29.8m ~38% decrease in underlying expenses vs FY16 on pro ❯ Reduced employee-related expenses a forma basis significant driver of the re
Slide 24: Questions
Questions Mike Fitzpatrick ASX: PAC // 24
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