NAOS Ex-50 Opportunities Co. Ltd. · ASX:NAC
NAOS Ex-50 Opportunities — Q2 FY24 Earnings Presentation
40 slides from NAOS Ex-50 Opportunities's earnings presentation, Feb 1, 2024
Slide 1: Q2 FY24 Investor Update and Q&A – Presentation Materials
NAOS Ex-50 Level 34 OPPORTUNITIES 25 Martin Place COMPANY LIMITED Sydney NSW 2000 (ASX: NAC) T (02) 9002 1576 ABN 49 169 448 837 F (02) 8215 0037 E enquiries@naos.com.au www.naos.com.au 1 February 2024 ASX Market Announcements ASX Limited 20 Bridge Street Sydney NSW 2000 Q2 FY24 Investor Update and
Slide 2: Q2 FY24 Investor Update and Q&A
For personal use only Thursday 1 February 2024 | 10:30am (AEDT) Q2 FY24 Investor Update and Q&A Click Here to Register
Slide 3: Important Information
Important Information This material has been prepared by NAOS Asset Management Limited (ABN 23 107 624 126, AFSL 273529) (NAOS) for general information purposes only and must not be construed as investment advice. It does not constitute an offer to purchase any security or financial product or servi
Slide 4: Get to Know NAOS
Get to Know NAOS For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 3
Slide 5: How We Invest & Why We Are Different
How We Invest & Why We Are Different For personal use only *Portfolio Weighted Average Calculations as at 31 December 2023 CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 4
Slide 6: Reasons Not to Invest with NAOS
Reasons Not to Invest with NAOS Our LICs are not for everyone. Some reasons why you may not choose to invest with NAOS include: For personal use only Concentrated portfolios (0-15 investments & shareholdings often >20%) Long-term investment philosophy (5+ years) Focus on emerging companies ($2
Slide 7: Investment Portfolio Performance Summary
Investment Portfolio Performance Summary For personal use only 1 Year 3 Year 5 Year Inception Q2 Performance FY24 Performance Performance (p.a.) Performance (p.a.) Performance (p.a.) NAOS LIC Benchmark^ NAOS LIC Benchmark^ NAOS LIC Benchmark^ NAOS LIC Benchmark^ NAOS LIC Benchmark^ NCC Investment Po
Slide 8: Q2 FY24 Summary
Q2 FY24 Summary Q2 FY24 was a highly volatile period with the S&P/ASX All Ordinaries Index returning +8.7%, despite November and December returning +5.2% and +7.4% respectively. For personal use only US Core PCE (Personal Consumption Expenditures) prices rose just +0.06% m/m in November, smalles
Slide 9: Negative Earnings Expectations for FY24
Negative Earnings Expectations for FY24 Investors expect profit growth to be negative for FY24 with minimal growth in FY25. Capital growth will be driven by valuations, which are impacted by interest rates and the longer-term economic backdrop. For personal use only S&P/ASX 200 - Change in Consensus
Slide 10: US Rate Cut Cycles – Magnitude & Duration
US Rate Cut Cycles – Magnitude & Duration Relative to the last 3 major interest rate cutting cycles the US Federal Reserve expects the number of rate For personal use only cuts to be of a similar magnitude, with 6 cuts forecast in CY24, although over a longer timeframe there are discrepancies in opi
Slide 11: Expectations For Interest Rate Reductions Have Sharpened
Expectations For Interest Rate Reductions Have Sharpened Economists appear to be well ahead of the US Federal Reserve in terms of expectations for rate cuts in 2024 and 2025, but given what we have seen historically, the Fed could surprise on the pace over the next For personal use only three years
Slide 12: CY23 in Review
CY23 in Review Total return for the S&P/ASX Small Ordinaries Index of +7.8% vs. +12.6% for the S&P/ASX-100. For personal use only In the US, technology stocks roared back into vogue with the Nasdaq returning +43.4% for CY23, compared to the S&P-500 return of +24.2% and Russell 2000 return of +16
Slide 13: CY23 Emerging Company Underperformance
CY23 Emerging Company Underperformance Emerging companies underperformed significantly in CY23. The S&P/ASX Emerging Companies Index underperformed the S&P/ASX 100 Index by -14% and the S&P/ASX Small Ordinaries Index by -4%. For personal use only CY23 Performance (Total Return) 15% 10% 5% 0% -5% -10
Slide 14: Peter Loimaranta, Chief Executive Officer and Managing Director
For personal use only Peter Loimaranta Chief Executive Officer and Managing Director CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 13
Slide 15: For personal use only
For personal use only
Slide 16: Market Drivers
For personal use only Market Drivers
Slide 17: Primary market driver links to overall road freight task
Primary market driver links to overall road freight task For personal use only • Road freight has been consistently growing and is the largest driver of the commercial parts industry • Historically consistent through various economic cycles • Wide variety of economic drivers contributing to the over
Slide 18: Other Influences
For personal use only Other Influences 17
Slide 19: Other Trends
For personal use only Other Trends
Slide 20: Other Trends
Other Trends • Industry consolidation • Customers For personal use only • Suppliers MaxiPARTS • Growth of aftermarket product / (29 sites) customer specific solutions Förch Australia • Alternative Powered Vehicles (3 warehouse dispatch • Timing and initial challenges points) • Initial movements in l
Slide 21: For personal use only
For personal use only
Slide 22: NAOS Investee Companies - Key Events Q2 FY24
NAOS Investee Companies - Key Events Q2 FY24 HOLDING INDUSTRY Q2 UPDATE For personal use only Acquisition of leading Western Australian truck/trailer parts distributor Independant Parts for $27m. Provides geographical benefits and a unique ‘on customer site’ operating model with expansion opportun
Slide 23: NAOS Investee Companies - Key Events Q2 FY24
NAOS Investee Companies - Key Events Q2 FY24 HOLDING INDUSTRY Q2 UPDATE For personal use only Contract completion of Project Caymus (US Dept of Defence project in Darwin) resulting in normalisation of cash balance to $39m (as at 10th October 2023). Acquisition of Piping Solutions for $20m incl.
Slide 24: NAOS Investee Companies - Key Events Q2 FY24
NAOS Investee Companies - Key Events Q2 FY24 HOLDING INDUSTRY Q2 UPDATE For personal use only Commercial activity continues – entered into two new exclusive product distribution agreements with European medical device suppliers (Morpheus AG & Euroset). Regulatory approvals received for re-usable
Slide 25: NCC Overview as at December 2023
NCC Overview as at 31 December 2023 $0.67 $0.75 $0.655 11.45% 10 $143.11m Pre-Tax NTA Post-Tax NTA Share Price Dividend Yield Number of Weighted Average For personal use only Holdings Market Capitalisation of the Investments FRANKED DIVIDEND HISTORY 10.0 80 72.50 9.0 70 8.0 7.50 7.50 7.50 7.25 7.25
Slide 26: NAC Overview as at December 2023
NAC Overview as at 31 December 2023 $0.90 $0.94 $0.845 7.10% 10 $162.9m Pre-Tax NTA Post-Tax NTA Share Price Fully Franked Number of Weighted Average For personal use only Dividend Yield Holdings Market Capitalisation of the Investments FULLY FRANKED DIVIDEND HISTORY Fully Franked Dividends Cumulati
Slide 27: NSC Overview as at December 2023
NSC Overview as at 31 December 2023 $0.72 $0.75 $0.665 7.52% 9 $187.8m Pre-Tax NTA Post-Tax NTA Share Price Fully Franked Number of Weighted Average For personal use only Dividend Yield Holdings Market Capitalisation of the Investments FULLY FRANKED DIVIDEND HISTORY Fully Franked Dividends Cumulativ
Slide 28: Our Learnings from CY23
Our Learnings from CY23 Timing of the Sale of Investment in Gentrack (ASX: GTK): Gentrack was a significantly profitable investment over CY23, although we exited too early. For personal use only Majority of the proceeds were used to build positions in Maxiparts (ASX: MXI) and Move Logistics Gr
Slide 29: We Remain Highly Confident in the Outlook for Our Portfolios
We Remain Highly Confident in the Outlook for Our Portfolios. Earnings per Share (EPS) Growth: We expect EPS growth for most of our core investments in FY24, despite a volatile demand For personal use only environment. Mixture of organic growth and strategic inorganic initiatives. Valuations
Slide 30: NAOS LICs Franked Dividend History and Profit Reserves
NAOS LICs Franked Dividend History and Profit Reserves Each LIC has consistently paid dividends and holds healthy profit reserves For personal use only 98.81 100 90 80 72.50 70 66.64 CENTS PER SHARE 60 50 46.65 44.1 42.50 40 34.0 29.75 30 20 14.9 10 0 NCC (Feb 2013) NAC (Nov 2014) NSC (Dec 2017) Tot
Slide 31: Q&A
Q&A Thank you for your continued support. For personal use only “Selling out at the bottom – and thus failing to participate in the subsequent recovery – is the cardinal sin of investing. The ability to persevere requires consistent adherence to a well- thought-out approach; control over emotion; an
Slide 32: NAOS Asset Management 1% Pledge
NAOS Asset Management 1% Pledge For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 31
Slide 33: Appendix
For personal use only Appendix
Slide 34: NAOS Directors and Team
NAOS Directors and Team OUR DIRECTORS For personal use only OUR TEAM CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 33
Slide 35: NAOS LICs Director Alignment
NAOS LICs Director Alignment Directors' shareholdings have significantly increased since the inception of each LIC For personal use only Inception Directors Shareholding 31 December 2023 Directors Shareholding 10,000,000 9,000,000 8,633,667 8,000,000 7,000,000 NUMBER OF SHARES 6,000,000 5,479,923 5,
Slide 36: Capital Management Initiatives
Capital Management Initiatives Performance • Maintain a focus on long term performance without deviating from the NAOS investment philosophy. For personal use only • Continue to focus on a growing stream of dividends, franked to the maximum extent possible, whilst maintaining Dividends an adequate r
Slide 37: NAOS ESG Framework
NAOS ESG Framework For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 36
Slide 38: What Qualitative Information Sources Does NAOS Use?
What Qualitative Information Sources Does NAOS Use? The NAOS Investment Team undertakes fundamental analysis on potential and current investments. Some examples of our key focus areas include: For personal use only CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 37
Slide 39: Why Invest via a Listed Investment Company?
Why Invest via a Listed Investment Company? We strongly believe LICs are a highly effective structure to give investors the highest quality exposure to specific asset classes, which in the case of NAOS is emerging businesses. For personal use only A Listed Investment Company structure: Allows the
Slide 40: Investor Awareness and Communication
Investor Awareness and Communication For personal use only FOLLOW NAOS Subscribe Now: www.naos.com.au/subscribe CONVICTION. LONG TERM. ALIGNED | Copyright 2024 NAOS Asset Management Limited 39
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