Eqt Holdings Ltd. · ASX:EQT
Eqt — Equity Trustees — Shareholder Meeting (November 2015)
61 slides from Eqt's shareholder meeting presentation, Nov 27, 2015
Slide 1: 2015 AGM Address to Shareholders
1 Equity Trustees Limited 2015 AGM Chairman and Managing Director For personal use only Address to Shareholders Slide 1: 2015 Annual General Meeting 1. Shareholders, ladies and gentlemen, good morning. My name is Tony Killen, I have the honour of being your Chairman. 2. On behalf of my fellow direct
Slide 2: Board of Directors
2 8. Ms Alice Williams joined the Board in September 2007 and is Chair of the Remuneration, Human Resources and Nominations Committee. Alice is also a member of the Board Investment Committee. 9. The Honourable Jeffrey Kennett AC joined the Board in September 2008 and is a member of the Remuneration
Slide 3: Agenda and Results Overview
3 Trustees’ Group. That meeting will commence at 12pm or as soon after that time as this Annual General Meeting has been concluded or adjourned. Finally, following the close of the Scheme meeting we will, as usual, serve light refreshments and ask you to join the Directors and management for informa
Slide 4: Risk framework and share price comparison
4 therefore decided that our risk management and compliance functions should be thoroughly overhauled. Work started on this in 2015 and will continue in 2016. Slide 6: Recent share price comparison For personal use only 23. This chart displays how the EQT share price and the ASX All Ordinaries index
Slide 5: Dividends and the Board
5 Slide 8: Dividends 26. The Board declared a final dividend of 48 cents per share (cps), taking the total for the year to 94 cps, the same as in the previous year. Considerations in the Board’s For personal use only decision on the dividend were multi-faceted – good operating performance, a strong
Slide 6: The Board (part 2) and Corporate restructure
6 Slide 10: The Board (part 2) 31. I stepped down from the Remuneration, Human Resources and Nominations Committee, and David Groves and Anne O’Donnell joined it, with Alice Williams For personal use only taking the Chair. David Groves joined the Board Investment Committee, which is now chaired by M
Slide 7: Looking ahead
7 Slide 12: Looking ahead 36. Operating profits YTD are modestly ahead of last year, but are being impacted by lower investment markets, as was noted earlier. Total profits are also at this stage ahead of last year, with a similar amount of non-recurring expenditure as at this time in the previous y
Slide 8: Managing Director: Operating Highlights
8 Slide 13: Mr. Robin Burns, Managing Director Equity Trustees Slide 14: Agenda Mr Robin Burns takes the lectern. For personal use only 2015 AGM Managing Director Presentation 43. Thank you Chairman. Slide 15: Operating Highlights 44. The year was another very active and full one for the company. Th
Slide 9: Operating highlights: CTS and will bank growth
9 I will touch on this activity further a little later. This momentum in the independent fiduciary side of CTS is continuing in the current period, and I am very pleased to note that we reached $50b of FUM/A in CTS a few weeks ago, despite the market factors. The drive to recreate net growth in the
Slide 10: Investment in culture and risk management
10 Hence in both 2015 and 2016 we are investing in developing the workplace culture and client-focused model that will closely align with and support our business strategies. 52. As a highly-regulated entity, but more importantly a fiduciary business touching over $50b of other people’s money, risk
Slide 11: Executive changes
11 57. Geoff Walsh joined in April as Chief Risk Officer and is leading the extensive risk and compliance project I have just spoken about. Sonya Clancy, who has the relevant senior executive experience, has taken on responsibility for Marketing and Communications as well as Human Resources. For per
Slide 12: Current year outlook and priorities
12 63. CTS revenue is currently ahead of last year’s at the same stage, however, the loss of PIMCO’s retail distribution FUM next month will have an impact on this specific line of activity in CTS, as the defensive asset products form the lion’s share of our distribution FUM, and we will therefore h
Slide 13: Superannuation business changes and our role
13 70. Consequently, the business has struggled to achieve strategic goals, although it has continued to be a good positive earnings contributor. As a result, we have recently decided to make some significant changes, including outsourcing the administration of the fund. For personal use only 71. Th
Slide 14: Items of Business
14 75. Finally I would like to congratulate and thank our executives, managers and staff for a very good year, in which many of our people put in an exceptional effort and demonstrated a very strong commitment to the company’s success and future. For personal use only Mr Killen resumes the lectern.
Slide 15: Shareholder questions
15 81. This year we invited questions from shareholders to be submitted prior to the meeting. In relation to the business of the AGM we have received one question; and in relation to the Scheme Meeting we have received three questions which we will deal with in that meeting. For personal use only 82
Slide 16: Remuneration
16 Slide 25: Remuneration 91. In common with most listed companies we monitor executive remuneration against market trends and outcomes. We have aimed to implement an approach that balances and rewards executive remuneration outcomes with other stakeholder interests, including of course and very imp
Slide 17: Remuneration vs dividends and proxies
17 The cumulative dividends paid to shareholders stand at 33 times the amount of the dividend paid in 2004, and as you can see this compares very positively to the cumulative growth in the remuneration for either the senior executives or the Board. 96. I commend the remuneration report for adoption
Slide 18: Voting and election of directors
18 105. This will be determined by a show of hands. Therefore, if you wish to vote, when asked to do so, please raise your hand showing your blue card. Note that visitors with a white card or joint holders or shareholders with a yellow card are ineligible to vote. For personal use only 106. For all
Slide 19: Proxies: re-election of Alice Williams
19 <Pause> 116. Thank you Slide 30: Proxies Received – Re-Election of Ms Alice Williams For personal use only 117. I would like to inform the meeting that the proxy position at the outset of the meeting is as shown on the screen. 118. In relation to the Open votes, the directors of Equity Trustees h
Slide 20: Proxies: re-election of Kevin Eley
20 127. If you would like to comment or ask a question would you kindly show your meeting admittance card, (blue or yellow), identify yourself, including who you represent, and be clear and concise. 128. Are there any questions or comments? For personal use only <Pause> 129. Thank you Slide 32: Prox
Slide 21: Special business: MD long term incentive
21 Slide 33: Items of Special Business – Item 4 138. Item 4 is the approval of the Long Term Incentive Award for the Managing Director, Series 2015/16, with a commencement date of 1 July 2015. For personal use only 139. This is a continuation of the annual series of recommendations to grant an award
Slide 22: Proxies: Long Term Incentive Award
22 144. Are there any questions or comments? <Pause> 145. Thank you For personal use only Slide 35: Proxies Received – Long Term Incentive Award to Managing Director 146. I would like to inform the meeting that the proxy position at the outset of the meeting is as shown on the screen. 147. In accord
Slide 23: Closing of meeting
23 <Count> 153. I declare that the resolution is passed. 154. Thank you. For personal use only Slide 36: Agenda 155. I would now like to ask if there are any questions from shareholders present today that have not been addressed thus far. <Pause> 156. Thank you Slide 37: Disclaimer Slide 38: Thank y
Slide 24: Annual General Meeting
For personal use only ANNUAL GENERAL MEETING
Slide 25: Board of Directors
Board of Directors For personal use only Mr JA (Tony) Killen OAM Mr Robin Burns Mr David Groves Ms Alice Williams Non-Executive Director, Chairman Managing Director Non-Executive Director, Non-Executive Director Deputy Chairman The Hon Jeffrey Kennett AC Ms Anne O’Donnell Mr Kevin Eley Mr Michael J
Slide 26: Agenda
Agenda For personal use only 1. Overview and Highlights Mr Tony Killen 2. Operational Performance Mr Robin Burns 3. Items of Business Mr Tony Killen 4. Questions 3
Slide 27: Overview – FY2015
Overview – FY2015 For personal use only 104% Operating TWS AND CTS profit EXPERIENCED (after tax) STRONG ORGANIC REVENUE GROWTH Net profit (after tax) 75% Group Organic Revenue growth of Operating margin up 8% 35% to 15% Full year fully franked dividend per share 94¢ 4
Slide 28: Significant Outcomes – 2015
Significant Outcomes – 2015 For personal use only • Successful completion of the ETWSL integration – a transformative event. • Integration achieved under budget, early, and realised initial goals. • Relationship with ANZ Bank progressing positively. • Strong organic revenue growth, in addition to th
Slide 29: Recent Share Price Comparison
Recent Share Price Comparison For personal use only 125 120 115 110 105 100 95 90 ALL ORDS 85 EQT Share Price 80 06/14 09/14 12/14 03/15 06/15 09/15 6
Slide 30: Net Profit After Tax up 75% at $17m
Net Profit After Tax up 75% at $17m For personal use only $17.0m $9.7m $8.2m $8.4m $8.7m 2011 2012 2013 2014 2015 7
Slide 31: Full year, fully franked dividend
Full year, fully franked dividend For personal use only Interim (cps) Final (cps) 100 92 94 94 85 50 42 46 46 40 50 45 50 48 48 2011 2012 2013 2014 2015 8
Slide 32: The Board and Committees
The Board and Committees For personal use only • Audit of director skills and experience – externally conducted. Positive conclusions re appropriate mix of skills, expertise, diversity and experience. • The audit and skills matrix process assists in meeting governance and regulatory obligations, as
Slide 33: The Board and Committees (cont.)
The Board and Committees (cont.) For personal use only Committee chairs now are: • Board Investment Committee (BIC) Mick O’Brien • Audit & Compliance Committee (A&CC) Kevin Eley • Remuneration, HR & Nominations Committee (R,HR&NC) Alice Williams • Board Risk Committee (BRC) Tony Killen Committee cha
Slide 34: Corporate Restructure
Corporate Restructure For personal use only • Driven by: impact of minimum regulatory capital obligations and inflexibility in funding options. • Proposed Scheme of Arrangement to create a new, unlicensed and single-purpose holding company. • Additionally, will facilitate: focused governance; licenc
Slide 35: Looking Ahead
Looking Ahead For personal use only • ASX values impacting revenue vs expectations. • Both Business Units operating successfully. • Overall strategic directions are consistent with prior periods ̶ Grow CTS business through expansion in range of products and services, and new business wins ̶ TWS busi
Slide 36: Mr Robin Burns, Managing Director
For personal use only Mr Robin Burns Managing Director Equity Trustees Limited
Slide 37: Agenda
Agenda For personal use only 1. Overview and Highlights Mr Tony Killen 2. Operational Performance Mr Robin Burns 3. Items of Business Mr Tony Killen 4. Questions 14
Slide 38: Operating Highlights
Operating Highlights For personal use only • Operating revenue growth – 17% in corporate business (CTS), 15% in private client business (TWS) (net of acquisition). • Operating margin 35%, up from 27%. (CTS 48%, TWS 27%). • Total Funds under management/administration (FUM/A) grew to $53b, up from $40
Slide 39: Investment in Business Growth, Capabilities
Investment in Business Growth, Capabilities For personal use only 1.0 2.7 0.5 1.6 Human Resources Enterprise Risk 0.3 0.3 TWS Business Development 1.2 + Marketing 1.1 9.1 0.3 8.2 0.7 5.7 5.1 3.4 2011 2012 2013 2014 2015 16
Slide 40: Group Leadership Team
Group Leadership Team For personal use only Robin Burns Managing Director & Chief Executive Officer Dr Paul Kasian Terry Ryan Geoff Walsh Head of Asset Management Chief Financial Officer Chief Risk Officer Head of Equities Corporate Services Enterprise Risk Harvey Kalman Ryan Bessemer Executive Gene
Slide 41: Business Update and Summary
Business Update and Summary For personal use only • At end of Q1, total FUM/A in CTS was $46b, up from $45b at June. • CTS operated 202 funds at end of September, for 84 clients. Both are increases over June numbers. • Very successful retention programme for ETWSL clients post- acquisition. TWS FUM/
Slide 42: Current Year Priorities
Current Year Priorities For personal use only • Business is financially strong – cash flow, balance sheet, results, and demonstrated execution capability. • Continue organic growth initiatives in each BU, particularly leveraging acquired client base. • Operational improvement projects – a significan
Slide 43: Our Role
Our Role For personal use only Partner with, or be, the trusted adviser – helping clients with the financial and emotional challenges arising from the preservation, growth and inter-generational management of (their) wealth 20
Slide 44: Agenda
Agenda For personal use only 1. Overview and Highlights Mr Tony Killen 2. Operational Performance Mr Robin Burns 3. Items of Business Mr Tony Killen 4. Questions 21
Slide 45: Items of Business
Items of Business For personal use only Item 1 To receive and consider the financial statements and the reports of the Directors and Auditor for the year ended 30 June 2015 Item 2 To adopt the remuneration report for year ended 30 June 2015 Item 3 To consider the election of Directors Item 4 To cons
Slide 46: Item 1: Financial statements and reports
Item 1 For personal use only To receive and consider the financial statements and the reports of the Directors and Auditor for the year ended 30 June 2015. 23
Slide 47: Item 2: Adopt remuneration report
Item 2 For personal use only To adopt the remuneration report for year ended 30 June 2015. 24
Slide 48: Remuneration
Remuneration For personal use only • Short Term Incentives – 40% of maximum pool paid in 2015 (40% in 2014). • Long Term Incentive allocations each year: − Series 8 Partially Earned (EPS 96.86% / *TSR 100%) (ended 30/6/15) − Series 9 Under Assessment (ends 30/6/16) − Series 10 Under Assessment (ends
Slide 49: Tracking Remuneration vs. Dividends
Tracking Remuneration vs. Dividends For personal use only Cumulative growth in Non-Executive Director remuneration Cumulative growth in Top 5 Executive plus MD remuneration Cumulative growth in Dividend per Share (DPS) 35 30 25 20 15 10 5 0 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015
Slide 50: Item 2: Proxies received
Item 2 For personal use only To adopt the remuneration report for year ended 30 June 2015 In respect of Item 2 of ordinary business, the following proxies have been received: For Against 380,696 10,512,609 (3.43%) Open (held by Equity Trustees Directors) = 135,192 27
Slide 51: Item 3: Election of Directors
Item 3 For personal use only To consider the election of Directors. 28
Slide 52: Item 3(a): Re-election of Ms Alice Williams
Item 3(a) For personal use only To consider the re-election of Ms Alice Williams. 29
Slide 53: Item 3(a): Proxies received
Item 3(a) For personal use only To consider the re-election of Ms Alice Williams In respect of item 3(a) of ordinary business, the following proxies have been received: For Against Ms Alice Williams 11,277,381 2,634 Open (held by Equity Trustees Directors) = 141,942 30
Slide 54: Item 3(b): Re-election of Mr Kevin Eley
Item 3(b) For personal use only To consider the re-election of Mr Kevin Eley. 31
Slide 55: Item 3(b): Proxies received
Item 3(b) For personal use only To consider the re-election of Mr Kevin Eley In respect of Item 3(b) of ordinary business, the following proxies have been received: For Against Mr Kevin Eley 11,279,825 190 Open (held by Equity Trustees Directors) = 141,942 32
Slide 56: Item 4: LTI award to Managing Director
Item 4 For personal use only To consider the grant of a long term incentive award to Managing Director. 33
Slide 57: Managing Director's LTI 2015/16 Series
Managing Director’s LTI 2015/16 Series For personal use only • Quantum: 60% of TEC ($620k) = $372k Maximum potential issue is 17,119 shares • Measures: 50% TSR / 50% EPS • Vesting Scales over three years: TSR Less than 50th percentile Nil 50th percentile 50% 75th percentile and above 100% EPS Less t
Slide 58: Item 4: Proxies received
Item 4 For personal use only To consider the grant of a long term incentive award to Managing Director In respect of Item 4 being special business, the following proxies have been received: For Against 10,786,331 493,189 Open (held by Equity Trustees Directors) = 137,300 35
Slide 59: Agenda
Agenda For personal use only 1. Overview and Highlights Mr Tony Killen 2. Operational Performance Mr Robin Burns 3. Items of Business Mr Tony Killen 4. Questions 36
Slide 60: Disclaimer
Disclaimer For personal use only Equity Trustees Limited ABN 46 004 031 298, Australian Financial Services Licence No 240975. This document was prepared by Equity Trustees Limited and is only provided for information purposes. It is not intended to take the place of professional advice and you shoul
Slide 61: For personal use only
For personal use only
Equity Trustees — Shareholder Meeting (November 2015) on 6ix