Magellan Financial Group Ltd · ASX:MFG
Magellan Financial — H1 FY2019 Earnings Presentation
18 slides from Magellan Financial's earnings presentation, Feb 14, 2019
Slide 1: Magellan Financial Group Limited Half Year Results
Magellan Financial Group Limited Half Year Results For the half year ended 31 December 2018 For personal use only Brett Cairns | CEO
Slide 2: Magellan Financial Group Interim Results
Magellan Financial Group Interim Results $ million 31 Dec 2018 31 Dec 2017 % change For personal use only Management and services fees 228.1 178.9 28% Performance fees 42.7 9.6 346% Other revenue 5.6 7.3 (23)% Adjusted revenue 276.4 195.8 41% Adjusted expenses (49.3) (53.0) (7%) Adjusted net profit
Slide 3: Interim Highlights
Interim Highlights For personal use only • Strong growth in funds under management and management and services fees: – Average funds under management up 35% to $72.1 billion1 – Management and services fee revenue up 28% to $228.1 million1 – Profit before tax and performance fees of the Funds Managem
Slide 4: Tax and Dividends
Tax and Dividends For personal use only • Effective tax rate for the 6 months to 31 December 2018 is 22.6% (Offshore Banking Unit) • Dividends: – Interim dividend up 66% to 73.8 cents per share (75% franked) – Pay dividends promptly – 28 February 2019 (Interim Dividend) – Dividend policy1 : o Interi
Slide 5: 2019 Expenses
2019 Expenses For personal use only • Total Group expenses (ex non-cash amortisation and Magellan Global Trust Unit Purchase Plan) to be approximately $105 million in the 2019 financial year ($101 million for FY2018) • Cost of funding Magellan Global Trust Unit Purchase Plan 5% discount: – Investmen
Slide 6: Funds Management Business
Funds Management Business For personal use only $ million 31 Dec 2018 31 Dec 2017 % change Revenue Management fees 225.8 176.6 28% Performance fees 42.7 9.6 346% Services fees 2.4 2.4 0% Interest/other income 2.4 0.5 363% 273.2 189.0 45% Expenses Employee expense 30.9 25.4 22% Marketing expense 1.8
Slide 7: Funds Under Management Summary
Funds Under Management Summary 31 Dec 2018 30 June 2018 31 Dec 2017 $ million For personal use only Retail 19,027 19,182 18,026 Institutional - Australia/New Zealand 11,511 11,680 5,054 - North America 13,845 13,596 12,560 - UK 21,623 20,804 18,312 - Rest of World 4,776 4,247 3,918 51,755 50,327 39,
Slide 8: Investment Performance
Investment Performance For the periods to 31 December 2018 For personal use only Since 1 Year 3 Years 5 Years Inception (%) (% p.a.) (% p.a.) (% p.a.)1 Magellan Global Fund 9.8 9.2 11.4 11.2 MSCI World NTR Index ($A) 1.4 7.5 9.7 5.2 Magellan Infrastructure Fund -0.4 7.7 11.1 7.8 Global Listed Infras
Slide 9: 1H19 FUM Flows
1H19 FUM Flows Retail Net Inflows1 For personal use only Institutional Net Inflows 1,800 500 $ Millions $475m $ Millions $1,608m 1,600 450 400 1,400 350 $331m 1,200 300 1,000 $887m 250 800 200 600 150 400 100 200 50 0 0 1H18 1H19 1H18 1H19 Total net inflows for the 6 months ended 31 December 2018: $
Slide 10: Well-balanced Business
Well-balanced Business For personal use only Funds Under Management1 Base Fees2 27% 47% 53% 73% Retail FUM Institutional FUM Retail Fees Institutional Fees 1. FUM split is as at 31 December 2018. 2. Base Fees are Management and Services fees for the six months to 31 December 2018 and exclude Perform
Slide 11: Retail Business – Three Channels to Market
Retail Business – Three Channels to Market For personal use only Independent • Relationships with over 500 independent advice firms1 financial advisers / • >40 stockbroking firms across Australia are using our Active ETFs broker advised • Strong relationships and representation with 4 of the top 5 m
Slide 12: Magellan Global Trust Unit Purchase Plan
Magellan Global Trust Unit Purchase Plan For personal use only • Announced 29 January 2019 • Opportunity for eligible Magellan Global Trust investors to subscribe for up to $15,000 additional units at a 5% discount to NAV without brokerage costs • Offer opened 6 February 2019 and closes 6 March 2019
Slide 13: Institutional Client Diversity
Institutional Client Diversity For personal use only 10% % of Total Management & Services 8% 6% Fees 4% 2% 0% 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 Top 30 Institutional Clients Cumulative Total Management and Services Fees Top Institutional Clients 5 10 20
Slide 14: New FUM opportunities
New FUM opportunities Self-directed High Conviction For personal use only retail Fund Global Equities ~US$7 billion A$65 billion in remaining capacity unlisted managed Global Listed funds1 Infrastructure Airlie Products under Sustainable development strategies Seeking to launch new US$15-20 billion
Slide 15: Principal Investments
Principal Investments For personal use only • Principal Investments include investments in Magellan Funds, listed shares, a small number of unlisted investments and surplus cash after allowing for the Group’s working capital requirements Investment ($ million) 31 December 2018 30 June 2018 Cash 0.4
Slide 16: Principal Investments (cont.)
Principal Investments (cont.) For personal use only • Board has set a pre-tax hurdle 10% p.a. (over business cycle) for the Principal Investments portfolio Investment Returns: Time Period Return 1 Year to 31 December 2018 7.4% 3 Years to 31 December 2018 p.a. 9.0% 5 Years to 31 December 2018 p.a. 11
Slide 17: Important Information
Important Information This presentation has been prepared by Magellan Financial Group Limited (‘MFG’). For personal use only While the information in this presentation has been prepared in good faith and with reasonable care, no representation or warranty, express or implied, is made as to the accur
Slide 18: For personal use only
For personal use only www.magellangroup.com.au Phone: +61 2 9235 4888
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