WAM Capital Ltd. · ASX:WAM
WAM Capital — Investor Presentation (May 2011)
28 slides from WAM Capital's investor presentation, May 19, 2011
Slide 1: WAM Capital Limited (WAM) Investor Presentation May 2011
WAM Capital Limited (WAM) Investor Presentation May 2011 For personal use only 1
Slide 2: Small Cap Value
Small Cap Value For personal use only * Source – The New York Times 2
Slide 3: Mid to Small Cap Sector Benefits
Mid to Small Cap Sector Benefits For personal use only • Small cap value has outperformed all other sectors* • Under researched – the market valuation is inefficient • Access to management - ability to build strong relationships • Life cycle of the business – ability to grow at a faster rate than la
Slide 4: LIC Structure Benefits
LIC Structure Benefits For personal use only Listed Investment Company’s are very attractive investment vehicles • Studies show LICs outperform managed funds* • Closed pool of capital – never forced seller or buyer • Provide consistent flow of fully franked dividends • Lower MER compared to managed
Slide 5: Our Experienced Team
Our Experienced Team Geoff Wilson - Chairman and Portfolio Manager For personal use only • • Chris Stott - CIO and Portfolio Manager, previously Head of Research • Kate Thorley - CEO of Wilson Asset Management. Kate was previously our CFO and remains Company Secretary for WAM, WAX and WAA. • Matthew
Slide 6: Investment Process: Research Driven
Investment Process “Research Driven” For personal use only Identify Company Undertake Detailed Research Visit with Management – 700+ companies p.a. Rank the Company (Rating template) Catalyst identified or occurs Buy or short sell shares 6
Slide 7: Investment Process: Market Driven
Investment Process “Market Driven” For personal use only We scour the market for trading opportunities. These could include participating in: ¾ initial public offerings ¾ placements ¾ block trades ¾ rights issues ¾ corporate transactions (such as takeovers, mergers, schemes of arrangements, corporat
Slide 8: Business Model
Business Model For personal use only Small to Medium Listed Company Investment focus LIC Structure + Experienced benefits team Investment + Flexible + Tight cost Process Mandate control Superior long term = performance record 8
Slide 9: Our Funds
Our Funds For personal use only WAM Capital (WAM) WAM Active WAM (WAA) Research (WAX) Market Research Driven Driven 9
Slide 10: Performance Financial Year to Date to April 2011
Performance Financial Year to Date to 30 April 2011 For personal use only Gross Portfolio 22.5% Pre-tax NTA per share growth plus dividends 19.2% Share price growth plus dividends 46.9% 10
Slide 11: Performance since Inception
For personal use only ‐ 100 200 300 400 500 600 700 800 ‐100 Jul‐1999 Nov‐1999 Mar‐2000 Jul‐2000 Nov‐2000 Mar‐2001 Jul‐2001 Nov‐2001 Mar‐2002 Jul‐2002 Nov‐2002 Mar‐2003 Jul‐2003 Nov‐2003 WAM Gross Portfolio Mar‐2004 Jul‐2004 Nov‐2004 Mar‐2005 Jul‐2005 Nov‐2005 Mar‐2006 Jul‐2006 Nov‐2006 Mar‐2007 Jul
Slide 12: Top Stocks as at April 2011
Top 10 Stocks as at 30 April 2011 For personal use only % Gross Company Assets RHG RHG Limited* 5.6% RKN Reckon Limited^ 4.3% ELI Emerging Leaders Investments Limited* 2.7% SGI Signature Capital Investments Limited* 2.6% MMS McMillan Shakespeare Limited^ 2.3% RPX RP Data Limited* 2.0% SGN STW Commun
Slide 13: Breville Group Ltd (BRG)
Breville Group Ltd (BRG) For personal use only • Wholesalers of houseware products • Forecasted FY12 PE 11x • Forecasted FY12 EPS Growth 12.1% • US growth continues to be strong with increased distribution • Australia retail remains soft with low consumer confidence 13
Slide 14: Colorpak Ltd (CKL)
Colorpak Ltd (CKL) For personal use only • Manufacturer of folding cartons • Forecasted FY12 PE of 7.5x • Forecasted FY12 EPS Growth 12.7% • Recently acquired Carter Holt Harvey (CHH) • Successful integration of CHH expected to drive earnings. 14
Slide 15: RHG Ltd Update
RHG Ltd Update For personal use only • We took action because we believed our capital was at risk • RHG action was the exception and not the rule • Our focus is to manage shareholders money • We actively pursued a change of the Board to protect the value of our investment, to keep the company listed
Slide 16: Dividends
Dividends Minimum Yield of 8% p.a. on For personal use only initial investment over last 11 years cents per share 18.0 16.0 14.0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 Ordinary fully franked dividends * annualised interim dividend Special fully franked dividends Equal Access Share Buy-Back 16
Slide 17: Dividends
Dividends For personal use only • The Board is committed to paying an increasing stream of fully franked dividends • Government reform in June 2010 has changed the way dividends are paid • Dividends paid if the company is solvent • WAM Capital has franking credits which allows it to pay 5.1 cents pe
Slide 18: Market Outlook
For personal use only Market Outlook 18
Slide 19: S&P/ASX Small Industrials vs Small Resources
S&P/ASX Small Industrials vs Small Resources 12 months to 11 May 2011 For personal use only Source: IRESS 19
Slide 20: Australian Retail Sales
Australian Retail Sales For personal use only Source: Macquarie Research, May 2011 20
Slide 21: Private Sector Credit Growth
Private Sector Credit Growth For personal use only Source: Macquarie Research, May 2011 21
Slide 22: S&P/ASX Performance
S&P/ASX 200 Performance For personal use only Source: Goldman Sachs May 2011 22
Slide 23: Analyst EPS Forecasts
Analyst EPS Forecasts For personal use only Source: Macquarie Research, May 2011 23
Slide 24: Current Issues
Current Issues For personal use only ¾ Australian Dollar ¾ Carbon Tax ¾ Interest Rates ¾ Australian Housing Market ¾ China 24
Slide 25: Shareholder Communications
Shareholder Communications For personal use only ¾ New Website – WAMFunds.com.au ¾ Media – Sky Business, Switzer, CNBC, Newspapers ¾ Research Reports – Bell Potter, Patersons & Independent Research Reports ¾ Audio casts – Monthly ¾ Subscribe for weekly emails ¾ Bi-annual presentations 25
Slide 26: WAM in the Community
WAM in the Community Our people are passionate about the well-being of our customers and the wider community because helping others is part of our culture. As For personal use only part of the WAM in the Community Program, we recently donated to the QLD Premier Disaster Relief Appeal. We have also p
Slide 27: WAM Capital Limited (WAM)
WAM Capital Limited (WAM) Investor Presentation May 2011 For personal use only 27
Slide 28: Disclaimer
Disclaimer For personal use only This presentation has been prepared for use in conjunction with a verbal presentation and should be read in that context. Information for the graphs, charts and quoted indices contained in this presentation has been sourced from IRESS Market Technology, Macquarie Res