WAM Capital Ltd. · ASX:WAM
WAM Capital — Investor Presentation (November 2012)
24 slides from WAM Capital's investor presentation, Nov 28, 2012
Slide 1: WAM Capital Limited Investor Presentation
WAM Capital Limited (WAM) Investor Presentation For personal use only November 2012
Slide 2: Executive summary
Executive summary For personal use only • FY2013 interim dividend guidance 9.1% increase to 6.0 cents per share fully franked • Annualised FY2013 fully franked dividend yield of 7.5%1 • Investment portfolio +13.3% for 12 months to 31 October 2012 outperforming the S&P/ASX All Ords Accum by 4.4% • To
Slide 3: Investment objectives
Investment objectives For personal use only • Deliver a growing stream of fully franked dividends • Provide capital growth • Preserve capital 3
Slide 4: Superior returns from growth companies
Superior returns from growth companies For personal use only WAM Capital has a focus on • growth companies - undervalued and under-researched • prevalent in the small to medium sized industrial sector p WAM Capital has delivered • regular stream of fully franked dividends • strong and consistent ret
Slide 5: Proposed merger with Premium Investors (PRV)
Proposed merger with Premium Investors (PRV) For personal use only • WAM Capital to merge with Premium Investors (Premium) on an NTA for NTA basis1 • Premium shareholders can elect: − 100% shares in WAM Capital with attaching options − 100% cash; or − a combination of both • Premium’s independent di
Slide 6: Merger indicative timetable
Merger indicative timetable For personal use only Scheme meeting 10 December 2012 Second court hearing and calculation date 12 December 2012 for NTAs Record date 20 December 2012 Implementation date 31 December 2012 New WAM Capital share and option holding by 8 January 2013 statements and cash consi
Slide 7: Placement and option issue
Placement and option issue For personal use only Placement • Oversubscribed raising $37 $37.0 0 million • Issued at pre-tax NTA (at 31 July 2012) of 161.59 cents Options • Exercise price: $1.60 • Exercisable at any time until 31 July 2013 • Can exercise to receive the proposed interim dividend • O t
Slide 8: Placement, proposed merger and option issue benefits
Placement, proposed merger and option issue benefits For personal use only • Reduction in fixed administrative expense ratio • Increase in liquidity of WAM Capital shares, 52% increase in daily average traded volume since placement • Greater market presence • Increased level of interest from financi
Slide 9: Dividend growth
Dividend growth For personal use only A Average f ll franked fully f k d dividend di id d yield i ld off 10 10.7% 7% on IPO price over 13 years Cents per share 16.0 14.0 12 0 12.0 10.0 8.0 6.0 4.0 2.0 0.0 Ordinary fully franked dividend Special fully franked dividend Equal access share buy-back *Pro
Slide 10: Outperformance
Outperformance For personal use only Since Performance 1 Year 3 Years 5 Years 10 Years Inception as at 31 October 2012 % %pa %pa %pa %pa (Aug-99) WAM Investment +13 3% +13.3% +10 9% +10.9% +5 1% +5.1% +14 4% +14.4% +17 8% +17.8% Portfolio S&P/ASX All Ordinaries +8.9% % +3.5% % -3.6% % +8.7% % +7.6%
Slide 11: Outperformance since inception
Outperformance since inception For personal use only 17.8% p.a. investment return over 13 years Index re-based 800 WAM Portfolio +33.4% above b pre-GFC GFC peakk 700 600 500 400 300 Index -24.5% from pre-GFC peak 200 100 - 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 WAM Cap
Slide 12: Premium / Discount to NTA
Premium / Discount to NTA For personal use only 30% 20% 10% 0% -10% 10% -20% -30% -40% 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 12
Slide 13: We believe…
We believe… For personal use only • meetings and interviews with company management gives us a deep insight into the ability of management and the growth dynamics of the company • it is vital we know our companies and their management as this gives us a competitive insight into what motivates people
Slide 14: Identifying undervalued growth stocks
Identifying undervalued growth th stocks t k For personal use only Management contact • Over 1,000 company meetings per year Research Driven rating process • Rate management • Rate the industry/position / Qualitative • Forecast two year EPS growth Quantitative • Valuation measure EPS/PE Filtering •
Slide 15: Top growth stocks as at October 2012
Top 10 growth stocks as at 31 October 2012 For personal use only % Gross Research Driven Investments Assets BRG Breville Group Limited 1.6% AHE Automotive Holdings Group Limited 1.5% NXT NEXTDC Limited 1.5% MFG Magellan Financial Group Limited 1.5% FAN Fantastic Holdings Limited 1 1% 1.1% SKE Skille
Slide 16: Energy Action Limited (EAX) - Growth stock
Energy Action Limited (EAX) - Growth stock For personal use only • Electricity auction and energy management business business, • Floated in October 2011, Market Cap of $65m, no debt, $6.7m cash • Idea g generated originally g y from the IPO roadshow • Followed up with three meetings with the compan
Slide 17: Breville Group Limited (BRG) - Growth stock
Breville Group Limited (BRG) - Growth stock For personal use only • Developer and distributor of household appliances • Idea generated in August 2010 reporting season following a company visit • Started to build position in August 2010 at $2.25 • Market was not pricing in the company’s expansion int
Slide 18: Investment process: Market Driven
Investment process “Market Market Driven” Driven For personal use only We utilise our extensive information network in the investment community and exploit mispricings in the market. These opportunities include: • initial public offerings • capital it l raisings i i • block trades • oversold o e so
Slide 19: Top Market Driven stocks as at October 2012
Top 10 Market Driven stocks as at 31 October 2012 For personal use only % Gross Company Assets ALS Alesco Corporation Limited 2.9% IBC Ironbark Capital Limited 2.5% CYA Century Australia Investments Limited 2.4% ELI Emerging Leaders Investments Limited 2.1% INA Ingenia Communities Group 1 6% 1.6% RH
Slide 20: Market Outlook
Market Outlook For personal use only • Further interest rate cuts forecast • Recent sharemarket rally - expansion of price to earnings multiples with earnings revisions coming • European uncertainty continues • US economy recovering, housing market has bottomed • Chi Chinese growth th showing h i si
Slide 21: Investor communication
Investor communication For personal use only ¾ Half yearly investor presentations ¾ Website – wamfunds.com.au ¾ Subscribe for weekly emails – includes market update ¾ Monthly investment update and NTA announcement ¾ Audio casts – monthly ¾ Media – Sky Business, Switzer, CNBC, newspapers, industry ma
Slide 22: Wilson Asset Management in the community
Wilson Asset Management i the in h communityi For personal use only We care deeply about the well-being of the wider community because helping others is part of our culture culture. Recently, Recently we entered a team into the Goulburn to Sydney Cycle Classic which raised over $80,000 for Odyssey H
Slide 23: Questions
For personal use only Questions 23
Slide 24: Disclaimer
For personal use only Disclaimer This presentation has been prepared for use in conjunction with a verbal presentation and should be read in that context. Information for the graphs, charts and quoted indices contained in this presentation has been sourced from IRESS Market Technology, WAM Capital L