Premier Miton Group Plc · LSE:PMI
Premier Miton — FY2024 Earnings Presentation
39 slides from Premier Miton's earnings presentation, Dec 4, 2024
Slide 1: Results Presentation
Results Presentation For the year ended 30 September 2024 4 December 2024 Mike O’Shea | Chief Executive Officer Piers Harrison | Chief Financial Officer Joffy Willcocks | Global Head of Distribution
Slide 2: Resilient performance in tough market; strongly positioned for an upturn
RESILIENT PERFORMANCE IN TOUGH MARKET; STRONGLY POSITIONED FOR AN UPTURN Resilient performance £10.7 billion closing Assets under Management (‘AuM’) Adjusted profit before tax of £12.2 million Cash balance of £35.9 million at 30 September 2024 Total proposed dividend for the year of 6.0 pence per sh
Slide 3: Results
RESULTS Assets under Management (‘AuM’) £bn Net flows £m AuM (cl.) AuM (av.) 500 400 Equity Multi-asset Fixed income 300 200 100 0 13.9 -100 10.7 -200 10.6 10.6 9.8 -300 -400 -500 -600 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q 1Q 2Q 3Q 4Q FY20 FY21 FY22 FY23 FY24 2020 2021 2022 2023 2024 Adjusted
Slide 4: Industry backdrop remains challenging
INDUSTRY BACKDROP REMAINS CHALLENGING IA retail flows (net) Fed rate 2.5% C-19 War / Inflation / Rate hikes Key points: 12 11 Difficult backdrop since Q1 2022 10 9 8 Gloomy outlook since the election in the 7 summer and uncertainty over tax changes 6 5 4 Investor focus has moved to global 3 2 Shift
Slide 5: What we can control
WHAT WE CAN CONTROL 01 02 03 Maintain a Deliver excellent Truly active diversified investment management + product mix performance original thinking 04 05 06 Precise Disciplined cost Continuing to enhance execution control, deliver our distribution reach, of M&A operational brand recognition efficie
Slide 6: A diversified product mix
01 A DIVERSIFIED PRODUCT MIX Coverage of key demand pools 5% Absolute return 18% growing strongly 19% Equity, UK Fixed income funds Equity, International now a growing Multi-asset, Multi Manager proportion of AuM £10.7bn Multi-asset, Direct & Diversified AuM Fixed Income Absolute Return Growth of lo
Slide 7: Investment performance remains strong
02 INVESTMENT PERFORMANCE REMAINS STRONG Proportion of funds as at 30 September 2024 68% Since launch / outperforming tenure 68% 32% (41 funds) 67% 5 years 67% 33% outperforming (27 funds) 50% 3 years 50% 50% outperforming (38 funds) Outperformance Underperformance Source: Premier Miton performance
Slide 8: Active management + original thinking
03 ACTIVE MANAGEMENT + ORIGINAL THINKING Premier Miton funds Tellworth UK Select to 31 October 2024 (%) – since inception (Open-ended) (A Inc share class) 60 TM Tellworth UK Select Fund SONIA ( compounded) Total return % 40 20 0 -20 Dec 2019 Nov 2020 Oct 2021 Sep 2022 Aug 2023 Jul 2024 89 88 86 86 P
Slide 9: Precise M&A: Tellworth
04 PRECISE M&A: TELLWORTH FY25 YTD Aum (£m) – Tellworth +12% £635m +16% 01 Capability led: £569m Long/short strategy attractive in current £490m environment. 02 Broadens distribution: Jan ’24 (Completion) Mar 24 Jun 24 Sep 24 Nov 24 Wholesale and institutional channels. Net flow contribution (£m) –
Slide 10: Disciplined cost control, operational efficiencies
05 DISCIPLINED COST CONTROL, OPERATIONAL EFFICIENCIES New COO joined in September Review of operational infrastructure underway Third-party suppliers – use of outsource providers and consideration of leveraging those relationships New risk analytics software being introduced Increased use of AI for
Slide 11: Continuing to enhance our distribution reach, brand recognition and client service
06 CONTINUING TO ENHANCE OUR DISTRIBUTION REACH, BRAND RECOGNITION AND CLIENT SERVICE Total meetings with FMs, Total attendees, 1 Oct 2023 to 30 Sep 2024 Investor Conference Activity In-person, direct & 1-on-1 remains high Virtual, 16% multi-contact 36% 709 37% 11% In-person, multi-contact Virtual,
Slide 12: Our investment case remains attractive
OUR INVESTMENT CASE REMAINS ATTRACTIVE Foundations now in place for the recovery in market sentiment Strong distribution and marketing capability Diversified fund range, with capacity Cash generative; attractive dividend yield Robust balance sheet (£35.9m cash, no debt) Experienced team capable of e
Slide 13: Distribution
Distribution Joffy Willcocks
Slide 14: The journey
THE JOURNEY 2022 2023 2024 2022 2023 2024 • Restructured and re-energised • Increased visibility of • New offshore fund platform sales and marketing Premier Miton in the market • 12 funds registered in Ireland • Distribution capabilities • All products to all channels • 6 funds registered in South A
Slide 15: Growth levers
GROWTH LEVERS Established credibility MPS Institutional across asset classes (Fixed Income, Multi-Asset, Equities) International Tellworth Retirement acquisition income Premier Miton is well placed to capitalise on growth opportunities Results Presentation 2024 15
Slide 16: Significant growth potential
Absolute return Equities SIGNIFICANT GROWTH POTENTIAL Multi-asset Fixed income 1 US Opportunities 2 UK Select 3 Fixed Income An alternative to the Absolute return/long Differentiated funds with highly concentrated tech short strategy. excellent performance at stocks / S&P trackers. the right time in
Slide 17: Managed Portfolio Service (MPS)
MANAGED PORTFOLIO SERVICE (‘MPS’) Advisers continue MPS market to flock to MPS Accelerated Proposition is growing rapidly to outsource by Consumer competitively £130bn+ investment Duty priced decision making Hiring of Investment Opportunity to win Strong recognition Director replacement assets as of
Slide 18: Distribution: targeted expansion
DISTRIBUTION: TARGETED EXPANSION New UCITs structure Further expand UCITS - wealth MPS, Institutional management & institutional Institutional Wealth Management, Institutional Institutional Results Presentation 2024 18
Slide 19: Brand repositioning
BRAND REPOSITIONING We are an active We give our fund managers a blank sheet of paper. manager with This means they can shape their funds in any way they see fit. high conviction portfolios. There is no top-down ‘house view’ imposed on the fund managers, each fund manager has the freedom to deploy I
Slide 20: Why will we succeed?
WHY WILL WE SUCCEED? Diversified fund range 8 core areas where we see strongest demand developing playing into our core investment strengths; New brand design – a re-launch of what / who is PMI. A strong campaign will raise brand awareness in both B2B and B2C; More activity internationally and insti
Slide 21: Financials
Financials Piers Harrison /
Slide 22: Results
RESULTS Assets under Management (‘AuM’) (£bn) Net management fee margin (bps) 9.8 10.7 61.7 58.9 2023 2024 2023 2024 Adjusted profit (£m) Adjusted operating margin (%) 15.7 23.5 12.2 19.7 2023 2024 2023 2024 Results Presentation 2024 22
Slide 23: Summary income statement
SUMMARY INCOME STATEMENT £m AuM ended the year at £10.7bn being an increase of 2024 2023 9% on the opening position. Average AuM 10,336 10,845 Net outflows for the year were £318m. Closing AuM 10,683 9,821 Gross profit 62.0 66.9 Net management fee margin reduced by 2.8bps. Net management fee margin
Slide 24: Profit bridge
PROFIT BRIDGE A disciplined approach to costs. £m (3.1) 5.9 0.6 (1.8) 1.4 3.2 (0.2) 1.1 (1.5) 0.8 FY23 Decrease in net revenue from Changes to product mix Increase in overheads Reduction in fixed staff costs Reduction in variable Exceptional items - closure Reduction in share-based Interest income F
Slide 25: Analysis of cost base
ANALYSIS OF COST BASE Administration expenses (£m) We continue to invest in the business to ensure we 51.7 are well placed to capture growth when demand 51.2 0.8 0.7 returns. 18.4 19.9 Administration expenses decreased by 1% to £51.2m. 9.7 8.6 Fixed staff costs decreased by 4%, reflecting lower aver
Slide 26: Analysis of cost base (continued)
ANALYSIS OF COST BASE (CONTINUED) Overheads and other costs (£m) Overheads and other costs are comprised of: 0.4 19.9 0.2 IT costs 0.8 Other 3% 12% 18.4 Compliance, legal, insurances, 15% occupancy Administration (including fund 50% accounting and Bloomberg costs) Sales & marketing 20% FY23 Tellwort
Slide 27: Balance sheet
BALANCE SHEET £m 30 SEPT 30 SEPT 2024 2023 Non-current assets Goodwill 74.1 70.7 Goodwill: £55.4m arising on merger in 2020. Intangible assets 15.1 17.7 Other investments 0.1 0.1 Property and equipment 0.6 0.5 £3.4m recognised in the year on the Tellworth Right-of-use assets 2.1 2.7 acquisition. Def
Slide 28: Dividend
DIVIDEND Dividends paid/proposed to shareholders for FY24 Final FY24 dividend proposed of 3.0p per share. £9.3m Dividends paid/proposed relating to FY24 total 6.0p per share (2023: 6.0p). (3.0p per share) paid Aug 2024 £4.6m Represents a dividend pay-out of approximately 95% of the adjusted profit a
Slide 29: Regulatory capital
REGULATORY CAPITAL £m 30 SEPT 2024 The Group maintains a strong capital base to Equity 119.0 support the future development of the business whilst ensuring compliance with regulatory Non-qualifying assets 1 (85.5) capital and liquidity requirements. Closing cash position of £35.9m and no debt. Quali
Slide 30: Outlook – strongly positioned for an upturn
OUTLOOK – STRONGLY POSITIONED FOR AN UPTURN 01 02 03 Truly active asset A step change High performing management will win in distribution to investment teams with passive as ‘core’ capture market share 04 05 06 A highly cash generative An attractive culture Significant opportunity business and robus
Slide 31: Appendices
Appendices
Slide 32: Market backdrop pre/post budget
MARKET BACKDROP PRE/POST BUDGET Pre-budget ‘inactivity’: Interest rates versus National money flowing into risk fiscal spending Insurance rise free assets (cash) IHT impact Recent Mansion US election Geopolitical on AIM House speech uncertainty Results Presentation 2024 32
Slide 33: A diversified, active asset manager
A DIVERSIFIED, ACTIVE ASSET MANAGER AuM at 30 September 2024 Equity (ex UK) Equity (UK) Multi-Asset Fixed Income Absolute Return £3.3bn £1.9bn £2.9bn £2.1bn £0.6bn US Equity Small Cap Directly Invested Fixed income funds Defensive Growth European Equity Income 2 Multi-Manager (including segregated L
Slide 34: Active management + original thinking
ACTIVE MANAGEMENT + ORIGINAL THINKING Active share* Tracking error^ (Open ended equity funds) Global Smaller Companies 99 6.0 US Smaller Companies 95 7.1 US Opportunities 94 9.4 European Opportunities 94 5.6 UK Smaller Companies 93 6.5 UK Focus 92 8.0 Global Sustainable Growth 91 3.9 Global Sustaina
Slide 35: Valuation summary
VALUATION SUMMARY Market Cap vs Cash EV / EBITDA, 2025e EV / Net Revenue, 2025e Source: Bloomberg, 13 Nov 2024 Source: Investec Source: Bloomberg, Investec £91m 9.8x 7.3x 8.0x Cash 4.5x £35.9m 0.8x 40% Premier UK European US Premier Miton Average Average Average Miton Price / AuM, 2024e Dividend Yie
Slide 36: Product range – single strategy and fixed income
PRODUCT RANGE – SINGLE STRATEGY AND FIXED INCOME As at 30 September 2024 Equity funds £5.1bn AuM AuM AuM AuM Year of 31 Mar 2023 30 Sept 2023 31 Mar 2024 30 Sept 2024 Fund launch Quartile8 £m £m £m £m manager(s) / tenure Premier Miton UK Multi Cap Income Fund 695 508 422 396 G Williams/M Turner 2011
Slide 37: Product range – single strategy and fixed income
PRODUCT RANGE – SINGLE STRATEGY AND FIXED INCOME As at 30 September 2024 Fixed income funds £1.3bn AuM AuM AuM AuM Year of 31 Mar 2023 30 Sept 2023 31 Mar 2024 30 Sept 2024 Fund launch Quartile8 £m £m £m £m manager(s) / tenure Premier Miton Corporate Bond Monthly Income Fund 272 283 295 430 L Harris
Slide 38: Product range – multi-asset
PRODUCT RANGE – MULTI-ASSET As at 30 September 2024 Multi-asset funds £2.9bn AuM AuM AuM AuM Year of 31 Mar 2023 30 Sept 2023 31 Mar 2024 30 Sept 2024 Fund launch Quartile8 £m £m £m £m manager(s) / tenure Macro thematic Premier Miton Cautious Multi-Asset Fund 320 288 284 274 Macro thematic team 2014
Slide 39: Disclaimer
DISCLAIMER This Presentation is strictly private and confidential, may not be distributed to any person other than the direct recipient and may not be copied, re-produced, discussed, published, quoted or referenced, in any form, in whole or in part, for any purpose whatsoever, without the prior writ