Polar Capital Holdings Plc · LSE:POLR
Polar Capital — FY2012 Earnings Presentation
26 slides from Polar Capital's earnings presentation, June 2012
Slide 1: Results Presentation June 2012
Results Presentation June 2012 Tim Woolley (CEO) John Mansell (COO) This presentation is for one-on-one use with non-US professional investors only www.polarcapital.co.uk
Slide 2: Contents
Contents Section I • Introduction to Polar Capital Section II • Business Review Section III • Financial Review For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 2
Slide 3: Introduction To Polar Capital
Introduction To Polar Capital For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 3
Slide 4: Who We Are
Who We Are • Polar Capital Holdings plc is a specialist investment management company offering professional and institutional investors a range of geographical and sector funds. The Company’s investment strategies have a fundamental research driven approach. The Company has long-only and absolute re
Slide 5: Philosophy
Philosophy • Primacy of investment performance • Institutional robustness across operational, compliance, risk and relationship management • Diversified yet complementary set of funds with a focus on fundamental research driven strategies • Culture which is flexible, entrepreneurial and transparent
Slide 6: Overview
Overview Management Board Business infrastructure Investment teams Tim Woolley Non-Executive Directors • Distribution and Marketing • Technology CEO/Co-Founder Hugh Aldous • Operational Support • Japan Tom Bartlam • Risk Management Non-Executive Chairman Brian Ashford-Russell • UK • Compliance John
Slide 7: Business Review
Business Review For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 7
Slide 8: Goals and Strategy
Goals and Strategy Goals • To be a leading global investment management boutique • To be a strong dependable partner to our clients offering them a range of interesting and differentiated investment products • To maintain a robust operational infrastructure • To maintain high levels of client servic
Slide 9: AUM Flows
AUM Flows AUM at start of period: 31 March 2011 $3.87bn Gross inflows quarter 1 [long 711 hedge 62] $773m quarter 2 [long 456 hedge 28] $484m quarter 3 [long 551 hedge 21] $572m quarter 4 [long 448 hedge 16] $464m $2,293m Gross outflows quarter 1 [long 167 hedge 133] $(300)m quarter 2 [long 294 hedg
Slide 10: Assets Under Management
Assets Under Management AUM split by strategy Investor mix by geography UK 68.9% Hedge Funds 14.1% Europe 20.8% Long Only 85.9% USA 7.7% Other 2.6% AUM split by business unit Investor mix by holdings Japan 29.8% Private Bank 28.3% Technology 29.1% European Fund of funds 24.3% 12.2% Financials 9.8% A
Slide 11: Product Overview
Product Overview Long only Hedge and absolute return UCITS Cayman Global Technology European Market Neutral – April 2012 Japan European Forager Healthcare Opportunities European Conviction Asian Financials Financial Opportunities – May 2011 ALVA Global Convertible Financials Income Global Insurance
Slide 12: Investment Teams: The original vision still holds true
Investment Teams The original vision still holds true Ten to twelve world class investment teams Pre 2010 2010 2011 2012 Technology Technology Technology Technology Japan Japan Japan Japan UK UK UK UK Europe Europe Europe Europe Healthcare Healthcare Healthcare Healthcare Financials Financials Finan
Slide 13: Distribution
Distribution November 2009 CEO 1 2 3 4 5 Direct 5 1 2 Support 2 November 2010 CEO CEO Head of UK Head of International 1 2 3 1 Direct 6 1 2 3 Support 3 June 2012 CEO Head of UK Head of North America Head of International 1 2 3 4? 1? 2? 1 2 3? Direct 8 Marketing Manager Client Support Manager 3rd Par
Slide 14: Lipper Figures For UCITS Strategies March 2012
Lipper Figures For UCITS Strategies 31 March 2012 3 months 6 months 1 year 3 years 5 years % Growth to % Growth to % Growth to % Growth to % Growth to universe position/ universe position/ universe position/ universe position/ universe position/ Strategies universe total Quartile universe total Quar
Slide 15: Hedge/Absolute Return Strategies March 2012
Hedge/Absolute Return Strategies 31 March 2012 Annualised returns Inception Fund date YTD 3 years 5 years Inception UK Absolute Return (Class I GBP)1 3 June 2008 5.68% 1.68% n/a 0.81% European Market Neutral (EUR)2 4 May 2010 2.33% n/a n/a 2.59% Forager (EUR) 1 August 2003 6.37% 15.10% 6.64% 11.79%
Slide 16: Polar Capital AUM: Good recovery since crisis
Polar Capital AUM Good recovery since crisis $6.0 $5.1 $5.0 $4.4 $4.2 $3.9 $3.9 $4.0 $3.5 $3.1 Billion $3.0 $2.5 $2.6 $2.2 $1.9 $2.0 $1.5 $1.5 $1.0 $0.0 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Source: Polar Capital, 31 March 2012. For non-US profess
Slide 17: Financial Review
Financial Review For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 17
Slide 18: Financial Review Highlights
Financial Review Highlights • AUM – AUM at 31 March 2012 increased 31% to $5.08bn from $3.86bn at March 2011 • Profitability – Pre-tax (pre SBP) profits up to £9.6m (2011: £9.2m) – Core operating profit excluding performance fees £7.1m (2011: £3.6m) • EPS and Dividend – Adjusted diluted EPS up to 10
Slide 19: Financial Review Profitability
Financial Review Profitability Year Year Year to March 10 to March 11 to March 12 Average AUM $1.9bn $3.2bn $4.5bn Core operating profit £0.0m £3.6m £7.1m Performance fee profit £2.5m £5.7m £4.1m Interest and similar income £1.2m £0.9m £0.1m PBT pre S.B.P. & Pre Goodwill £3.7m £10.2m £11.3m Source:
Slide 20: Financial Review Costs
Financial Review Costs Year Year Year to March 10 to March 11 to March 12 Comments Salaries and bonuses £8.1m £8.9m £11.0m Increase in staff numbers Core distributions £1.6m £3.5m £3.3m Core compensation costs £9.7m £12.4m £14.3m Other operating costs £4.6m £6.1m £6.9m See next page Core operating c
Slide 21: Financial Review Other operating costs
Financial Review Other operating costs Year to Year to Year to March 10 March 11 March 12 Comments IT £1.5m £2.0m £2.1m Rent and rates £0.8m £1.1m £1.2m Professional fees £0.5m £0.7m £0.9m Insurance £0.4m £0.4m £0.4m Travel and entertainment £0.5m £0.7m £0.8m Other £0.5m £1.2m £1.5m £0.6m of recruit
Slide 22: Financial Review Dividend
Financial Review Dividend • Total dividend for the year 9.0p (2011: 7.5p) • Dividend reflects: – Improved profitability of the company – Health and strength of the company’s balance sheet – Quiet optimism regarding the company’s prospects Source: Polar Capital. Past performance is not indicative or
Slide 23: Financial Review Cash and investments
Financial Review Cash and investments March 2011 March 2012 £m £m Cash £19.2m £22.6m Available for sale investments Hedge fund investments £ 4.2m £ 1.1m Hedge fund seed £15.2m £15.2m Long only seed £ 7.1m £ 9.1m £26.5m £25.4m Long only protection and cash collateral £ 2.9m £ 1.0m £29.4m £26.4m Total
Slide 24: Financial Review Shareholder analysis at March 2012
Financial Review Shareholder analysis at 31 March 2012 Holding Percentage Directors, founders and staff 33.9m 43% Caledonia 10.7m 13% XL 8.0m 10% EBT 2.0m 3% Blackrock 5.7m 7% Artemis 2.9m 4% Legal & General 2.7m 3% Free Float = 31% Cazenove 2.5m 3% Others 10.9m 14% Total shares in issue 79.3m 100%
Slide 25: Summary: Well positioned in challenging times
Summary Well positioned in challenging times Strong • Consistent and impressive bull and bear market performance performance • Across long and hedge strategies • Significant potential for further growth Fund capacity • Total current capacity in the funds of > $10 billion of which only $5.1 billion c
Slide 26: Important Information
Important Information Polar Capital 4 Matthew Parker Street London SW1H 9NP House View This document has been produced based on Polar Capital research and analysis and represents our house view. All sources are Polar Capital unless otherwise stated. Important Information The information provided in
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