Pinnacle Investment Management Group Limited · ASX:PNI
Pinnacle Investment Management — Wilsons Rapid Insights Conference 2023
31 slides from Pinnacle Investment Management's conference presentation, May 16, 2023
Slide 1: Wilsons Rapid Insights Conference Presentation
16 May 2023 By Electronic Lodgement Market Announcements Office ASX Ltd 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam For personal use only Wilsons Rapid Insights Conference Presentation Pinnacle Investment Management Group Limited (ASX: PNI) is pleased to attach a copy of a presentation that will
Slide 2: Wilsons Rapid Insights Sydney
For personal use only PINNACLE INVESTMENT MANAGEMENT GROUP LIMITED (PNI) Wilsons Rapid Insights Sydney Ian Macoun – CEO/Managing Director Andrew Chambers – Executive Director, Head of Institutional and International Distribution Dan Longan – CFO Andrew Lockhart – Managing Partner, Metrics Adrian Mac
Slide 3: Important notice and disclaimer
Pinnacle Investment Management Group Limited (PNI) This presentation has been prepared by Pinnacle Investment Management Group Limited ABN 22 100 325 184 (PNI). The information in this presentation is current as at 17 May 2023. PNI has prepared this presentation based on information available to it.
Slide 4: Agenda
For personal use only Agenda 01 Introduction to Pinnacle 02 Latest Update 03 Diversification and growth in private markets 04 Growth Agenda 05 Additional Information
Slide 5: Introduction to Pinnacle
For personal use only 01 Introduction to Pinnacle
Slide 6: Introduction to PNI
Introduction to PNI 5 • What PNI offers shareholders • Highly diverse earnings stream, generated from multiple asset classes • High growth – 5-year compound NPAT growth of 45% per annum1 For personal use only • High growth in dividends – 5-year compound dividend growth of 38%2 per annum1 • Continuin
Slide 7: Introduction to PNI
Introduction to PNI 6 • How we receive our profits • Our share of Affiliates’ profits – equity accounted (1H FY23 NPAT – our share $28.4m of $70.1m total) For personal use only • ‘Parent’ revenues for our services, offset by costs of provision and ‘Horizon 2’ investment for future growth • Three Hor
Slide 8: Introduction to PNI
Introduction to PNI 7 • What is ‘special’/distinctive about Pinnacle? • Our distinctive business model was designed specifically to ensure sustained investment excellence - embedded in our DNA For personal use only • The most talented and experienced investment professionals love it; more importantl
Slide 9: 1H FY23 Themes
1H FY23 Themes (as reported in half-year results presentation) • Core revenues (ex-performance fees) resilient For personal use only • Earnings impacted by cost of Horizon 2 investment in both Pinnacle and Affiliates as investment for future growth continues • During 1H FY23, market and style shifts
Slide 10: 1H FY23 financial highlights
1H FY23 financial highlights (as reported in half-year results presentation) 9 Pinnacle is not immune to market factors, but diversified platform provides resilience and will drive growth throughout the cycle Affiliate FUM / Revenue (100%) NPAT / EPS For personal use only Affiliate FUM (100%) 31 Dec
Slide 11: Latest Update
For personal use only 02 Latest Update
Slide 12: Update to March 2023 – FUM and flows
Update to 31 March 2023 – FUM and flows 11 • Total Affiliate FUM (at 100%) at 31 March 2023 of $89.2 billion • up $6.0 billion (7.2%) from $83.2 billion at 31 December 2022 For personal use only • up $5.4 billion (6.5%) from $83.7 billion at 30 June 2022 • Total Retail FUM (at 100%) at 31 March 2023
Slide 13: Update to March 2023 – revenues and performance
Update to 31 March 2023 – revenues and performance 12 • Contained annual revenue impact of net flows for the quarter to 31 March 2023 was positive, although this quarter’s client and asset class mix of flows delivered inflows at a lower average fee rate than for outflows • 83% of Pinnacle Affiliates
Slide 14: Diversification and growth in private markets
For personal use only 03 Diversification and growth in private markets
Slide 15: Diversification and resilience of core earnings
Diversification resilience of core earnings 14 Over the past six years we have pursued diversification by asset class, client type and revenue source, including performance fees Change in FUM by Asset Class (%) 31 Dec 22 $11.3bn For personal use only 30 Jun 16 13% 1H23 FUM by Affiliate (%) $1.5bn
Slide 16: Why private markets?
Why private markets? 15 • Globally, total private markets Assets Under Management (AUM) reached US$11.7tr as of 30 June 2022, and has grown at an annual rate of 20% since 2017 For personal use only • Private markets have the potential to offer enhanced returns, inflation protection and portfolio div
Slide 17: Pinnacle private markets: a story of growth and diversification
Pinnacle private markets: a story of growth and diversification 16 Private markets FUM has grown from $1.4bn and 7% of total FUM at 30 June 2016, in one manager and one strategy (Palisade), to $15.9bn and 19% of total FUM at 31 December 2022 ($19.1bn AUM at 31 December 2022) across four managers and
Slide 18: Case study - Metrics
Case study - Metrics 17 Leading alternative investment manager specialising in private debt Pinnacle has been Metrics’ distribution partner since For personal use only • the inception of the business in 2013 • Pinnacle acquired a 35% equity interest in July 2018. AUM of $3.0bn as at 30 June 2018, of
Slide 19: Case study - Metrics
Case study - Metrics 18 Leading alternative investment manager specialising in private debt • In excess of 120 employees including 70+ origination professionals located in Sydney, Melbourne and Auckland For personal use only • Metrics also continues to diversify both its product base and end client
Slide 20: Case study – Five V Capital
Case study – Five V Capital 19 Leading Australian and New Zealand mid-market private equity firm • Team of 25 (up from 12 in December 2021, when Five V and Pinnacle formed their partnership) Growth partner to some of Australia and New Zealand's market-leading, innovative companies in industries with
Slide 21: Case study – Five V Capital
Case study – Five V Capital 20 Leading Australian and New Zealand mid-market private equity firm For personal use only Sources: S&P Capiq, Illion, BDO, PwC
Slide 22: Conclusion
For personal use only 04 Conclusion
Slide 23: What differentiates Pinnacle?
What differentiates Pinnacle? 22 Platform liberates investment professionals to focus on what Highly attractive platform for the 1 best investment professionals they do best For personal use only 83% of FUM has outperformed benchmark over five-year period1 Gross FUM (at 100%) of $83.7bn1 acros
Slide 24: Summary
Summary 23 Pinnacle’s diverse Affiliate portfolio and extensive distribution channels provide robustness whilst fostering growth opportunities Fundamentals in place • Highly regarded Affiliates with strong local and international investment consultant and research house ratings for organic sales gro
Slide 25: Conclusion
Conclusion 24 • Our distinctive, modular platform provides us with an excellent foundation for delivering continued growth within existing Affiliates and for prosecuting new Horizon 2 and 3 growth initiatives when they emerge For personal use only • Institutional investors, financial advisers and in
Slide 26: Additional Information
For personal use only 05 Additional Information
Slide 27: Pinnacle has a diversified Affiliate platform
Pinnacle has a diversified Affiliate platform 26 Track record of investing to deliver medium-term growth Executives of both Pinnacle and Pinnacle Affiliates have significant equity interests. Equity ownership enhances alignment with shareholders. Seed FUM and Middle office and Technology and other f
Slide 28: Continuing strong investment performance of Affiliates to 31 March 2023
27 I n ce p t io n I n ce p t io n 5 Y (p .a .) 1 0 Y (p .a .) (p .a .) d a te Pi n n a cl e I n ve stm e n t M a n a g e m e n t H y p eri o n Asset M a n a g em en t - Gro ss Perfo rm a n ce H yp erio n Au stra lia n Gro w th Co m p a n ies Fu n d 11.89% 11.28% 12.08% 1/10/2002 Ou tp erfo rm a n c
Slide 29: Affiliates' investment performance
28 I n ce p tio n I n ce p tio n 1Y 3 Y (p .a .) 5 Y (p .a .) 1 0 Y (p .a .) (p .a .) d a te Pi n n a cl e In vestm en t Ma n a g em en t H yp eri o n Asset M an ag em en t - Gro ss Perfo rm an ce Hyp erio n Au stralian Gro w th Co m p an ies Fu n d -5.06% 13.39% 11.89% 11.28% 12.08% 1/10/2002 Ou tp
Slide 30: Affiliates' investment performance
1Y 3 Y (p .a .) 5 Y (p .a .) 1 0 Y (p .a .) I n ce p tion I n ce p tion 29 (p .a .) d a te Pi n n a cl e In vestm en t Ma n a g em en t Fi retrai l In vestm en ts - Gro ss Perfo rm an ce Firetrail Au stralian High Co n victio n Fu n d -2.16% 20.18% 7.08% 6.53% 14/03/2018 Ou tp erfo rm an ce -2.26% 3
Slide 31: For personal use only
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