Pacific Current Group Ltd · ASX:PAC
Pacific Current — Shareholder Meeting (November 2020)
20 slides from Pacific Current's shareholder meeting presentation, Nov 20, 2020
Slide 1: 2020 Annual General Meeting Presentation
Tacoma // Denver // Sydney // Melbourne ASX ANNOUNCEMENT 20 November 2020 2020 Annual General Meeting Presentation Pacific Current Group Limited (ASX:PAC), a global multi-boutique asset management firm, is pleased to provide its 2020 Annual General Meeting Presentation for release to the market. AUT
Slide 2: Annual General Meeting
ANNUAL GENERAL MEETING 20 November 2020
Slide 3: Disclaimer
DISCLAIMER The information in this presentation is general information about Pacific Current Group (‘Pacific Current’ or ‘PAC’) and is current only at the date of this presentation. In particular, this presentation: ❯ is not an offer or recommendation to purchase or subscribe for securities in Pacif
Slide 4: Business Overview
BUSINESS OVERVIEW Paul Greenwood, CEO & CIO
Slide 5: Review of FY20 Highlights
REVIEW OF FY20 HIGHLIGHTS After significant change in the portfolio in FY19, FY20 was one of reinforcement and growth in contrast with the chaotic external environment. Investment Activity » Proterra Investment Partners (US$20.5 million) - a private equity firm focused on natural resources » Pennyba
Slide 6: FUM Growth by Manager in FY20
FUM GROWTH BY MANAGER IN FY20 A number of boutiques grew well but were overshadowed by the spectacular results of GQG which grew at 77% off an already large base. Tier 1 Boutiques (A$B) Tier 2 Boutiques (A$B) 125% $64.7 100% $2.7 FY20 Growth in local currency 75% 50% $3.6 $4.7 25% $1.5 $2.2 $6.6 $4.
Slide 7: FY21 Updates
FY21 UPDATES Since 30 June there has been a variety of noteworthy developments at PAC and within the PAC portfolio: Sale of Seizert Capital » Sold for US$5m (A$6.85m) » Crystalized loss allows PAC to apply for US$6.1M (A$8.4m) tax refund » Absence of Seizert will reduce FY21 revenues by an estimated
Slide 8: FUM Growth by Manager in September 2020 Quarter
FUM GROWTH BY MANAGER IN SEPTEMBER 2020 QUARTER Growth has continued in the quarter ending 30 September 2020, led once again by GQG Tier 1 Boutiques (A$B) Tier 2 Boutiques (A$B) 50% $77.7 40% Sept-20 Quarter Growth 30% in local currency 20% $4.5 $1.7 $7.1 $4.7 10% $2.1 $2.2 0% $3.2 -10% $2.6 -20% $0
Slide 9: COVID-19 Impact on Boutiques
COVID-19 IMPACT ON BOUTIQUES • Performance fees have been delayed because poor environment to sell underlying assets Existing Business • No health related issues at boutiques or PAC • Changing allocator appetite for different investment products offered by PAC boutiques • Inability to travel for fun
Slide 10: Revenue Diversification
REVENUE DIVERSIFICATION PAC’s underlying revenue shift away from equity market dominance underscores the increased diversification across boutiques, investment classes, geographies, and industry sectors. Share of Revenue^ Linked to Equity Markets* » In FY20 revenues continued to shift away from acti
Slide 11: Earnings Predictability by Portfolio Company
EARNINGS PREDICTABILITY BY PORTFOLIO COMPANY The short-term visibility of each boutique’s contribution varies considerably based on the factors noted below. LESS VISIBILITY MORE VISIBILITY BOTTOM LINE REVENUE SHARE PERFORMANCE FEES PREFERRED SECURITIES OPEN-END FUNDS CLOSED-END FUNDS PUBLIC SECURITI
Slide 12: Combining the Pieces
COMBINING THE PIECES ❯ PAC’s portfolio represents a broad collection of different risks, each with different return potential. The individual pieces can be challenging to forecast because of their different business models (see below), varying economic arrangements, and differing fundraising cycles
Slide 13: FY20 Financial Results
F Y 2 0 F I N A N C I A L R E S U LT S Ashley Killick, CFO
Slide 14: FY20 Financial Performance Snapshot
FY20 FINANCIAL PERFORMANCE SNAPSHOT The business achieved record underlying profit, a 40% increase in fully franked dividend, and substantial growth in funds under management. 13% 18% 40% 62% on pcp on pcp on pcp on pcp ($) (Cents) (Cents) ($B) 8.04 8.09 6.84 6.08 25 15 51 93 44 57 10 10 FY19 FY20 F
Slide 15: Underlying Profit Drivers
UNDERLYING PROFIT DRIVERS Growth in underlying profit was driven by increases in boutique contributions and active expense management. Underlying Revenue ($m) Underlying Expenses ($m) Underlying NPAT ($m) 47.2 48.7 25.0 19.8 16.7 20.8 33.3 33.8 6.3 9.8 7.6 5.1 FY19 FY20 FY19 FY20 FY19 FY20 Corporate
Slide 16: Strategy and Outlook
‘STRATEGY AND OUTLOOK
Slide 17: Strategy
STRATEGY PAC is focused on growing the existing business and diversifying the portfolio, while also seeking new revenue sources Invest and Enhance Explore New Diversify Distribution Revenue Sources » Continue pursuing private capital » Increase breadth of PAC’s distribution » PAC has the ability to
Slide 18: Outlook
Outlook ❯ Pipeline of attractive investments is strong, with PAC expecting to make at least two investments in FY21 ❯ FY21 earnings visibility is clouded by impact of COVID on realization of performance fees, and timing of new boutique fundraising ❯ Expect acceleration of new commitments to PAC bout
Slide 19: Questions
QUESTIONS
Slide 20: Annual General Meeting - Firm Overview
ANNUAL GENERAL MEETING 20 November 2020 Firm Overview
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