Liontrust Asset Management Plc · LSE:LIO
Liontrust Asset Management — FY2022 Earnings Presentation
43 slides from Liontrust Asset Management's earnings presentation, June 2022
Slide 1: Liontrust Asset Management PLC Full Year Results
Liontrust Asset Management PLC Full Year Results June 2022 | John Ions & Vinay Abrol For professional investors and advisers only
Slide 2: Contents
Contents 1. Highlights of the Financial Year 2. Strategic objectives 3. Investment strength 4. Flows and AuMA 5. Brand 6. Key metrics 7. Financials summary 8. Majedie acquisition 9. Outlook 10. Appendix 1
Slide 3: Highlights of the Financial Year
Highlights of the Financial Year
Slide 4: Highlights
Highlights Net inflows Retail sales Acquisition Majedie Asset £2.5bn 2nd Management 12 months to 31 March 20221 2nd highest net retail sales in Announced acquisition of in December the UK in 20212 2021 and completed 1 April 2022 Performance Awards Website 99% Over five years to 31 March 2022, 99% of
Slide 5: Highlights: financials
Highlights: financials Financial results demonstrate a profitable and growing business Gross profit Profit before tax Adjusted profit before tax* £231.3m £79.3m £96.6m +41% +127% +64% Gross profit up 41% to £231.3m from Profit before tax up 127% to Adjusted profit before tax up 64% to £163.8m in 202
Slide 6: Highlights: AuMA
Highlights: AuMA On 31 March 2022, our AuMA stood at £33,548 million and were broken down by type and investment process as follows: Total Institutional1 Retail Multi-Asset Offshore Funds Process (£m) (£m) (£m) (£m) (£m) Sustainable Investment 13,227 136 12,187 - 904 Economic Advantage 9,035 455 8,2
Slide 7: Highlights: flows
Highlights: flows Liontrust recorded net inflows of £2,488m in the financial year to 31 March 2022 (2021: £3,498m). A reconciliation of fund flows over the financial year is as follows Total Institutional UK Retail Multi-Asset1 Offshore Funds Process (£m) (£m) (£m) (£m) (£m) Opening AuMA – 1 April 2
Slide 8: Strategic objectives
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Slide 9: Strategy: Six principal objectives
Strategy Six principal objectives 1 2 3 4 5 6 Be a responsible Deliver strong Expand Acquire and Enhance the Ensure strong company and long-term distribution and develop talent investor operations and investor investment products experience infrastructure performance organically and through acquisit
Slide 10: Focus areas for success
Focus areas for success Technology + Added value Growing Sales efficiency products Client Talent experience development Support Outsourcing infrastructure 9
Slide 11: Investment strength
» LIONTRUST COURAGE - POWER - PRIDE Investment strength
Slide 12: Investment performance
Investment performance Over three years to 31 March 2022, 98% of UK-domiciled funds were in the 1st or 2nd quartile of their respective IA sectors* Over five years to 31 March 2022, 99% of UK-domiciled funds were in the 1st or 2nd quartile of their respective IA sectors* 12 funds have the 5-Crown ra
Slide 13: Awards
Awards Liontrust won UK Equity Manager of the The Liontrust Sustainable Investment Year at the Professional Pensions team won the Best Sustainable & ESG Investment Awards 2021 Equity Fund category with the Liontrust SF Global Growth Fund Liontrust won Asset Manager of the Year The Liontrust Sustaina
Slide 14: Flows and AuMA
» LIONTRUST COURAGE - POWER - PRIDE Flows and AUMA
Slide 15: Flows and market context
Flows and market context Quarterly flows FY22 Rotation from Growth to Value from autumn 2021 £1.1bn Buyers’ strike in 1st quarter of 2022 £1.0bn £0.8bn Attractive valuations appearing for Quality Growth Clients waiting to invest in Quality Growth -£0.4bn 1st Quarter 2nd Quarter 3rd Quarter 4th Quart
Slide 16: Sales momentum – the Pridham Report – 2021
Sales momentum – the Pridham Report – 2021 Top 10 gross retail sales in 2021 Top 10 net retail sales in 2021 £m £m BlackRock £27,979.90 Baillie Gifford £3,764.30 Legal & General IM £15,216.70 Liontrust £3,651.00 Baillie Gifford £14,210.40 HSBC Asset Management £3,265.80 Fidelity £13,273.10 Legal & G
Slide 17: Sales momentum – the Pridham Report – Q1 2022
Sales momentum – the Pridham Report – Q1 2022 Top 10 gross retail sales in Q1 2022 Top 10 net retail sales in Q1 2022 £m £m BlackRock £6,975.00 Fidelity £1,586.60 Fidelity £4,687.00 BlackRock £870.30 Legal & General IM £4,119.30 HSBC Asset Management £843.00 HSBC Asset Management £3,039.50 Legal & G
Slide 18: Opportunities for distribution
Opportunities for distribution Sustainable and EA seen as market leaders Global Fundamental brings institutional distribution, Edinburgh Investment Trust, Tortoise long/short equity, UK and Global funds Growing demand for Cashflow Solution funds Consolidators and aggregators in adviser market Exclus
Slide 19: Global Equity Fund range | Organic net sales since acquisition
Global Equity Fund range | Organic net sales since acquisition Global Equity Team Flows £150,000,000 £104,102,099 £100,000,000 £50,000,000 £42,684,012 £0 -£50,000,000 -£100,000,000 -£150,000,000 -£200,000,000 -£215,119,574 -£250,000,000 FY 19/20 FY 20/21 FY 21/22 Source: Liontrust, April 2022. This
Slide 20: Brand
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Slide 21: Brand
Brand 1 Ranked the 8th best asset management brand in the UK (Source: Broadridge’s annual survey, March 2021) 2 37% of wealth managers/financial advisers and 28% of consumers say Liontrust has the best ESG/sustainable investment team, ranking first among both (source: Research in Finance, December 2
Slide 22: Key metrics
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Slide 23: Key metrics – 31 March 2022 including Majedie
Key metrics – 31 March 2022 including Majedie AuMA by product AuMA by client type* AuMA by process UK Retail £24,651m 64% Financial Adviser 41% Sustainable Investment £13,227m 34% Offshore £2,412m 6% Wealth Manager 18% Economic Advantage £9,035m 23% Institutional £4,975m 13% Life & P
Slide 24: Key metrics – April 2022
Key metrics – April 2022 Percentage of NAV by region Percentage of NAV by asset class Americas 21% Bonds 10% Asia 2% Equities 74% Europe ex UK 16% Funds 14% UK 61% Derivatives 3% Bond NAV by region Equity NAV by region Funds of Funds NAV by region 13% 20% 24% 2% 3% 24% 59% 61% 14% 80
Slide 25: Diversification of AuMA including Majedie assets
Diversification of AuMA including Majedie assets Visual representation of the 31 March 2022 AuMA, funds and institutional accounts Sustainable Future Economic Advantage Multi-Asset Funds Global Fundamental Institutional and ITs UK Retail Offshore Funds Multi-Asset Portfolios Global Equity Cashflow G
Slide 26: Financials summary
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Slide 27: Key statistics
Key statistics Acquisition timeline ATI Neptune Architas Majedie FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 AUMA (£bn) 3.0 3.6 4.5 4.8 6.5 10.5 12.7 16.1 30.9 33.5 % change 20% 25% 7% 35% 62% 21% 27% 92% 8% Revenue (£m) 20.3 28.4 36.8 44.9 51.6 76.8 84.6 106.6 163.8 231.3 % change 40% 30% 22%
Slide 28: Full Year results for the 12 months ended 31 March 2022
Full Year results for the 12 months ended 31 March 2022 Full Year results: • Revenues £231.3 million (FY21: £163.8 million) up 41% and excluding performance fees up 46% • Adjusted PBT of £96.6 million (FY21: £59.0 million1) up 64%2 • Adjusted diluted EPS of 127.63p for FY22 (FY21: 80.14p1) up 59%3 •
Slide 29: Reconciliation of adjusted profit to profit before tax
Reconciliation of adjusted profit to profit before tax for the 12 months ended 31 March 2022 FY21 FY22 restated £’000 £’000 Change Profit before tax 79,291 34,929 127% Severance compensation and staff reorganisation costs 704 1,793 (61)% Professional services 6,920 15,025 (54)% Intangible asset amor
Slide 30: Income statement (adjusted)
Income statement (adjusted) FY22 FY211 £’000 £’000 Change Gross profit excluding performance fees 218,724 150,067 46% Performance fees 12,595 13,692 (8)% Gross profit 231,319 163,759 41% Net gains 26 922 Member/employee costs (120,517) (104,877) 15% Other administration expenses and depreciation (31
Slide 31: Balance sheet as at 31 March 2022
Balance sheet as at 31 March 2022 31 March 2022 31 March 2021 £’000 £’000 Assets Non current assets 106,406 117,646 Current assets Trade and other receivables 235,496 289,805 Financial assets 4,168 2,188 Cash and cash equivalents 120,852 71,898 Total current assets 360,516 363,891 Liabilities Non cu
Slide 32: Majedie acquisition
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Slide 33: Acquisition of Majedie
Acquisition of Majedie Liontrust acquired Majedie Asset Management for an initial consideration of 3.7 million Liontrust shares (including £5.5 million regulatory capital) plus up to 0.78 million Liontrust shares and up to £23 million in cash for excess NAV and deferred consideration. Based on 31 Ma
Slide 34: Details of the transaction
Details of the transaction Liontrust acquired the entire issued share capital of Majedie for a Consideration of up to £120 million1 consisting of: • £80 million satisfied through the issue of 3,683,241 new Ordinary Shares to Majedie shareholders at Completion (“Initial Consideration Shares”) • Up to
Slide 35: Outlook
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Slide 36: Industry outlook
Industry outlook Mixed flows ESG up front and central Retail investor engagement M&A growing Private markets Solutions 35
Slide 37: Outlook for Liontrust
Outlook for Liontrust Seven investment teams with rigorous and distinct investment processes Strengthening distribution in institutional market – recent LGPS Central win to manage global sustainable equities EIT provides base to build investment trust business Expand international distribution Inves
Slide 38: Appendix
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Slide 39: Appendix – Alternative Performance Measures (APMs)
Appendix – Alternative Performance Measures (“APMs”) The Group uses the following APMs: Adjusted profit before tax* Definition: Profit before taxation, amortisation, and non-recurring items (which include: professional fees relating to acquisitions; restructuring and severance compensation related c
Slide 40: Appendix – APMs (continued)
Appendix – APMs (continued) Gross profit excluding performance fees Definition: Gross profit less any revenue attributable to performance related fees. Reconciliation: Note 4. Reason for use: This is used to present a consistent year on year measure of gross profits within the business, removing the
Slide 41: Appendix – APMs (continued)
Appendix – APMs (continued) Average Assets under Management and Advice Definition: The average of aggregate assets managed or advised by the Group during the financial year Reconciliation: Average AuMA for the year is the average of each month end aggregate AuMA during the period. Reason for use: Av
Slide 42: Key risks
Key risks Past performance is not a guide to future performance. The value of an investment and the income generated from it can fall as well as rise and is not guaranteed. You may get back less than you originally invested. All Liontrust Funds carry some degree of risk which may have an adverse eff
Slide 43: Disclaimer
Disclaimer Strictly private and confidential information Important notice This presentation is issued by Liontrust Asset Management PLC and Liontrust Fund Partners LLP (LFP) (both 2 Savoy Court, London WC2R 0EZ). LFP is authorised and regulated in the UK by the Financial Conduct Authority (FRN 51816
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