Polar Capital Holdings Plc · LSE:POLR
Polar Capital — H1 2013 Earnings Presentation
27 slides from Polar Capital's earnings presentation, December 2012
Slide 1: Results Presentation December 2012
Results Presentation December 2012 Tim Woolley (CEO) John Mansell (COO) This presentation is for one-on-one use with non-US professional investors only www.polarcapital.co.uk
Slide 2: Contents
Contents Section I • Introduction to Polar Capital Section II • Business Review Section III • Financial Review For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 2
Slide 3: Introduction To Polar Capital
Introduction To Polar Capital For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 3
Slide 4: Who We Are
Who We Are • Polar Capital Holdings plc is a specialist investment management company offering professional and institutional investors a range of geographical and sector funds. The Company’s investment strategies have a fundamental research driven approach. The Company has long-only and absolute re
Slide 5: Philosophy
Philosophy • Primacy of investment performance • Institutional robustness across operational, compliance, risk and relationship management • Diversified yet complementary set of funds with a focus on fundamental research driven strategies • Culture which is flexible, entrepreneurial and transparent
Slide 6: Overview
Overview Management Board Business infrastructure Investment teams Tim Woolley Non-Executive Directors • Distribution and Marketing • Technology CEO/Co-Founder Hugh Aldous • Operational Support • Japan Tom Bartlam • Risk Management Non-Executive Chairman Brian Ashford-Russell • UK • Compliance John
Slide 7: Business Review
Business Review For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 7
Slide 8: Goals and Strategy
Goals and Strategy Goals • To be a leading global investment management boutique • To be a strong dependable partner to our clients offering them a range of interesting and differentiated investment products • To maintain a robust operational infrastructure • To maintain high levels of client servic
Slide 9: AUM Flows
AUM Flows AUM at 31 March 2011 $3.87bn Gross inflows Total [long 2166 hedge 127] $2,293m Gross outflows Total [long1055 hedge 194] $(1,249)m Net flows $1,044m Performance and currency movements $164m AUM at 31 March 2012 $5.08bn Gross inflows quarter 1 [long 599 hedge 16] $615m quarter 2 [long 404 h
Slide 10: AUM Analysis
AUM Analysis AUM split by strategy Investor mix by geography Hedge Funds 14.3% UK 73.6% Long Only 85.7% Europe 16.2% USA 6.1% Other 4.2% AUM split by business unit Investor mix by holdings Japan 26.8% Banks 24.5% Technology 24.9% 19.7% Fund Of Funds European 12.3% Private Wealth Managers 15.4% Finan
Slide 11: Investment Teams: The original vision still holds true
Investment Teams The original vision still holds true Ten to twelve world class investment teams Pre 2010 2010 2011 2012 Technology Technology Technology Technology Japan Japan Japan Japan UK UK UK UK Europe Europe Europe Europe Healthcare Healthcare Healthcare Healthcare Financials Financials Finan
Slide 12: Fundamental Research Driven Investment Strategies
Fundamental Research Driven Investment Strategies • 579 years of collective investment experience Global Technology European Long/Short Global Healthcare Japan team (2001) UK team (2001) team (2003) Globalteam (2007)team Global team (2001) team Technology Japan team UK team European team Healthcare
Slide 13: Product Overview
Product Overview Long only Hedge and absolute return UCITS Cayman Global Technology European Market Neutral Japan European Forager Japan Alpha – launched in Q4 2012 European Conviction Healthcare Opportunities Asian Financials ALVA Global Convertible Financial Opportunities Financials Income UCITS G
Slide 14: Lipper Figures For UCITS Strategies 30 November 2012
Lipper Figures For UCITS Strategies 30 November 2012 3 months 6 months 1 year 3 years 5 years % Growth to % Growth to % Growth to % Growth to % Growth to universe position/ universe position/ universe position/ universe position/ universe position/ Strategies universe total Quartile universe total Q
Slide 15: Hedge/Absolute Return Strategies 31 October 2012
Hedge/Absolute Return Strategies 31 October 2012 Annualised returns Strategies Inception date YTD 3 years 5 years Inception UK Absolute Return (Class I GBP) 1 3 June 2008 0.83% -3.76% n/a -1.61% European Market Neutral (EUR) 2 4 May 2010 -4.32% n/a n/a -0.72% European Market Neutral (Class I EUR) 1
Slide 16: Distribution
Distribution November 2009 CEO 1 2 3 4 5 Direct 5 1 2 Support 2 November 2010 CEO CEO Head of UK Head of International 1 2 3 1 Direct 6 1 2 3 Support 3 November 2012 CEO Head of UK Head of North America Head of International 1 2 3 4? 1? 2? 1 2 3? Direct 8 Marketing Manager Client Support Manager 3rd
Slide 17: Polar Capital AUM: Good recovery since crisis
Polar Capital AUM Good recovery since crisis $6.0 $5.5 $5.3 $5.1 $5.1 $5.0 $4.4 $4.2 $3.9 $3.9 $4.0 $3.5 $3.1 Billion $3.0 $2.5 $2.6 $2.2 $1.9 $2.0 $1.5 $1.5 $1.0 $0.0 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Dec-10 Mar-11 Jun-11 Sep-11 Dec-11 Mar-12 Jun-12 Sep-12 Nov-12 Source: Polar Capita
Slide 18: Financial Review
Financial Review For non-US professional investor use only. Please refer to the Important Information at the end of this presentation. 18
Slide 19: Financial Review: Highlights from 6 months ending September 2012
Financial Review Highlights from 6 months ending September 2012 • AUM – AUM at 30 September 2012 up to US$5.30bn from US$5.08bn at March 2012 – AUM at 30 November 2012 up to US$5.55bn • Profitability – Core operating profit excluding performance fees up 20% to £4.2m (2011: £3.5m) – Pre-tax (pre SBP)
Slide 20: Financial Review: Profitability
Financial Review Profitability 6 months 6 months Year 6 months to September 11 to March 12 to March 12 to September 12 Average AUM US$4.2bn US$4.4bn US$4.3bn US$5.1bn Core operating profit £3.5m £3.6m £7.1m £4.2m Performance fee profit £1.5m £2.6m £4.1m - Interest and similar income £(0.2m) £0.3m £0
Slide 21: Financial Review: Costs
Financial Review Costs 6 months 6 months Year 6 months to September 11 to March 12 to March 12 to September 12 Salaries and bonuses £5.7m £5.3m £11.0m £6.1m Manufactured dividend - - - £0.2m Core distributions £1.5m £1.8m £3.3m £2.1m Core compensation costs £7.2m £7.1m £14.3m £8.4m Other operating c
Slide 22: Financial Review: Other operating costs
Financial Review Other operating costs 6 months 6 months Year 6 months to September 11 to March 12 to March 12 to September 12 IT £1.1m £1.0m £2.1m £1.3m Rent and rates £0.6m £0.6m £1.2m £0.6m Professional fees £0.4m £0.5m £0.9m £0.3m Insurance £0.2m £0.2m £0.4m £0.2m Travel and entertainment £0.3m
Slide 23: Financial Review: Dividend
Financial Review Dividend • First dividend for the year 2.0p (2011: 1.5p) • Dividend reflects: – Improved profitability of the company – Health and strength of the company’s balance sheet – Quiet optimism regarding the company’s prospects – Increase in dividend should not be an indication of an anti
Slide 24: Financial Review: Cash and investments
Financial Review Cash and investments March 2012 September 2012 £m £m Cash £22.6m £20.8m Available for sale investments Hedge fund investments £ 1.1m - Hedge fund seed £15.2m £15.5m Long only seed £ 9.1m £ 6.2m £25.4m £21.7m Long only protection and cash collateral £ 1.0m £ 0.3m £26.4m £22.0m Total
Slide 25: Financial Review: Shareholder analysis at 30 September 2012
Financial Review Shareholder analysis at 30 September 2012 Holding Percentage Directors, founders and staff 30.6m 39% Caledonia 8.0m 10% XL 8.0m 10% EBT 1.9m 2% Blackrock 7.6m 9% Artemis 3.4m 4% Free Float = 39% Cazenove 3.1m 4% Others 16.8m 22% Total shares in issue 79.4m 100% At Share Price of £2.
Slide 26: Summary: Well positioned in challenging times
Summary Well positioned in challenging times Funds and • Expanded and differentiated product offering performance • Good performance across a wide range of funds • Total current capacity in the funds in excess of US$10bn Fund capacity • Significant potential for further growth • Invested heavily in
Slide 27: Important Information
Important Information Polar Capital 4 Matthew Parker Street London SW1H 9NP House View This document has been produced based on Polar Capital research and analysis and represents our house view. All sources are Polar Capital unless otherwise stated. Important Information The information provided in
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