Quilter PLC · LSE:QLT
Quilter — Investor Presentation (2024)
28 slides from Quilter's investor presentation, Oct 5, 2024
Slide 1: Investor introduction Spring 2024
Investor introduction Spring 2024 2024
Slide 2: Business overview
Business overview Quilter
Slide 3: A transformed investment case: Quilter now vs at Listing
A transformed investment case: Quilter now vs at Listing June 2018 Spring 2024 Sold in Quilter International 2021 for £481m Sold in c.£1.3bn¹ returned to shareholders Quilter Life Assurance 2020 for £425m Market cap £2.7bn Sold in Single Strategy business 2018 for £583m Core business Core business M
Slide 4: Quilter’s core business: two segments – ‘Affluent’ and ‘High Net Worth’
Quilter’s core business: two segments – ‘Affluent’ and ‘High Net Worth’ High Net Worth Affluent Key competitors Integrated Advice High Net Worth Key competitors • Brewin Dolphin Discretionary investment Advice, platform administration High Net Worth management and advice and investment solutions Qui
Slide 5: How we make money
How we make money Quilter
Slide 6: How we make money: segments
How we make money: segments High Net Worth Affluent Asset management & advice Asset administration, asset management & advice Revenues earned Revenues earned c.£210m c.£390m c.70bps DFM fee c.25bps Platform fee c.£190m c.£210m £28bn £78bn c.35bps management fee c.£110m £29bn c.15-20% £25bn c.75bps a
Slide 7: Investment income
Plus investment return on shareholder funds A 50% decline in interest rates would be offset by a 5% increase in AuMA Investment income Head Office/ Group Capital sensitivity to interest rates £m 80 70 Investment income 60 50 40 £62m 30 20 10 £16m 0 1 2 3 4 5 2022 2023 Quilter achieved interest rate
Slide 8: Financials: FY23
Financials: FY23 High Net Worth Affluent Revenues Revenues £185m £6m £292m Net management fees Investment Net management fees revenues £20m £70m £31m Advice Advice Investment fees¹ fees¹ revenues c.£210m c.£400m Expenses Expenses c.£170m c.£270m Profit before tax Profit before tax c.£40m c.£130m Gro
Slide 9: Key areas of strategic focus
Key areas of strategic focus Flows Building Enhancing Distribution Propositions 9
Slide 10: Where do flows come from?
Where do flows come from? Two strong distribution channels: IFAs and Quilter RFPs – delivering a strong flow funnel Independent Financial Advisers (IFAs) Quilter Restricted Financial Planners (RFPs) Strategy: Grow, broaden, deepen Strategy: Grow number & improve productivity 2,000 important relation
Slide 11: Gross flows in 2023
Gross flows in 2023 IFA channel Quilter channel +8% y-o-y +13% y-o-y £5.3bn (6%) y-o-y £3.6bn £1.7bn +25% y-o-y £0.5bn HNW Affluent HNW Affluent 11
Slide 12: A closer look at Affluent: administered vs managed AuMA in 2023
A closer look at Affluent: administered vs managed AuMA in 2023 Platform Investment solutions £73bn¹ assets under administration £14bn £26bn¹ assets under management £59bn £13bn £12bn IFAs Quilter advisers IFAs Quilter advisers Note: Numbers may not cast dues to rounding. 1. Excludes non-core assets
Slide 13: Managed Portfolio solutions
Principal solutions Revenue margins Growth dynamic Cirilium Active c.£5bn (31)% y-o-y c.65bps Declining Fund of funds solutions Cirilium c.£7.5bn +21% y-o-y c.25-45bps Growing Blend/Passive WealthSelect Managed Portfolio c.£8bn +22% y-o-y c.30bps Growing Active solutions WealthSelect c.25bps Growing
Slide 14: Key areas of strategic focus
Key areas of strategic focus Efficiency Driving Efficiency 14
Slide 15: Three key initiatives to deliver a 30% operating margin
Three key initiatives to deliver a 30% operating margin Affluent High Net Worth Improve advice productivity through technology transformation Advice Adviser operating model transformation Transformation IT and operations simplification Moving to single legal/regulatory entities HNW Evolution Evolvin
Slide 16: How we have performed
How we have performed Quilter
Slide 17: How we have performed: Affluent gross flows
How we have performed: Affluent gross flows Quilter Platform market share¹: gross flows and assets 15% Total share of gross flows Total share of stock 14% 13% 12% 11% 10% 9% Pre-PTP Post-PTP 8% Note: 1Q24 total market denominator figures exclude Curtis Banks’ AuMA and Gross sales respectively in ord
Slide 18: How our Platform gains market flow
How our Platform gains market flow Quilter Platform IFA channel net transfer trends by source of funds 1Q 2023 vs 1Q 2024 net flows, £m 1Q23 1Q24 Largest peers Listed peers Other Platforms Other incl. Life co's and Consolidators pension providers As at 31 March 2024. Note: Presentation provides a sn
Slide 19: How we have performed since completing strategic reshaping
How we have performed since completing strategic reshaping Adjusted diluted EPS momentum: Operating margin Adjusted profit indicative trajectory +81% +55% +8 ppts 30% 167 9.4 27% 7.4 7.9 22% 22% 138 19% 134 5.2 108 £m p per share FY20 FY21 FY22 FY23 Medium- pro forma term FY20 FY21 FY22 FY23 FY20 FY
Slide 20: Efficient capital and balance sheet management
Efficient capital and balance sheet management 1 ➢ Group capital requirements (regulatory capital and stress buffers) On-going ➢ Current year dividend cash needs ➢ Working capital and interest Solvency II Ratio 2 271% Investing ➢ Growth investment organically ➢ Simplification programme Capital inves
Slide 21: Strategic positioning and investment case
Strategic positioning and investment case 21
Slide 22: What differentiates Quilter?
What differentiates Quilter? Balanced business mix covering the entire waterfront of UK wealth Channel agnostic: strong market positions in IFA and restricted channels Open, unbundled business model with transparent pricing All products/ services available to our advisers and IFAs – ensures they are
Slide 23: Building the UK’s best-in-class wealth manager
Building the UK’s best-in-class wealth manager Delivering our strategy of efficiency and faster growth UK-wide recognised Grow Quilter adviser wealth manager and IM numbers Support access to advice: through adviser Advice and productivity and solutions technology investment Customer Delivering focus
Slide 24: The Quilter investment case
The Quilter investment case Drivers Deliverables for shareholders Secular industry growth Revenue growth Improving flows and market share Expense management self-help through Simplification Cost optimisation Bolt-on M&A to accelerate strategy and growth Stock re-rating Capital discipline 24
Slide 25: Appendix
Appendix Quilter
Slide 26: Client pricing: open, unbundled, with choice at the heart
Client pricing: open, unbundled, with choice at the heart Average fees example, reflecting current predominant choice by clients & their advisers % of investment Total Upfront Ongoing p.a. Equivalent p.a. Total Financial p.a/ Wrapper / Investment Total Advice Total Advice A+B Advice 10 Years Admin M
Slide 27: AuMA and flows: good Quilter channel performance
AuMA and flows: good Quilter channel performance FY23 1Q24 Gross Net Gross Net AuMA Net / opening AuMA flows flows flows flows Quilter Channel £2.9bn £0.5bn £0.4bn 17% £3.1bn £0.2bn £0.1bn High Net Worth IFA / Direct Channel £24.1bn £25.0bn £0.6bn £(0.05)bn £1.7bn £(0.5)bn (2%) Quilter Channel £17.2
Slide 28: Disclaimer
Disclaimer This presentation may contain forward-looking statements with respect to certain Quilter plc’s plans and its current goals and expectations relating to its future financial condition, performance and results. By their nature, all forward-looking statements involve risk and uncertainty bec