Magellan Financial Group Ltd · ASX:MFG
Magellan Financial — Shareholder Meeting (October 2018)
19 slides from Magellan Financial's shareholder meeting presentation, Oct 4, 2018
Slide 1: 2018 AGM Presentation
Magellan Financial Group Limited 2018 AGM Presentation For personal use only Hamish Douglass | CEO & Chief Investment Officer
Slide 2: 2018 Highlights
2018 Highlights For personal use only • Strong growth in funds under management and management and services fees: – Average funds under management up 29% to $59.0 billion1 – Management and services fee revenue up 26% to $385.8 million1 – Profit before tax and performance fees of the Funds Management
Slide 3: Magellan Financial Group Full Year Results
Magellan Financial Group Full Year Results $ million 30 June 2018 30 June 2017 % change For personal use only Management and services fees 385.8 307.2 26% Performance fees 39.8 21.7 83% Other revenue 27.0 9.4 188% Revenue 452.6 338.3 34% 1 Expenses before MGG net offer costs and amortisation (101.0)
Slide 4: Stakeholder value creation
Stakeholder value creation For personal use only Value creation since 2006 Magellan Financial Group1 – shareholders $5.3 billion Global Equities2 – clients $30.0 billion Infrastructure Equities2 – clients $4.8 billion Total $40.1 billion ~$40 billion of value created for stakeholders since the busin
Slide 5: Funds Management
For personal use only Funds Management Magellan| 5
Slide 6: Funds Management Business
Funds Management Business For personal use only $ million 30 June 2018 30 June 2017 % change Revenue Management fees 381.1 300.5 27% Performance fees 39.8 21.7 83% Services fees 4.7 6.7 -29% Interest/other income 3.2 0.3 909% 428.7 329.2 30% Expenses Employee expense 51.9 47.3 10% Marketing expense
Slide 7: Revenue Growth Drivers
Revenue Growth Drivers 7% For personal use only • Magellan reported 29% growth in management, services and performance fees in 2018 21% – 72% was contributed from Existing FUM – 21% was contributed from Net Inflows during the year – 7% was contributed from the acquisition of 72% Airlie • Excluding t
Slide 8: Drivers of shareholder value
For personal use only Drivers of shareholder value Magellan| 8
Slide 9: A model for long term Total Shareholder Return (TSR)
A model for long term Total Shareholder Return (TSR) For personal use only 4-5% pa 11-14% pa FUM Flows/ additional opportunities 7-9% pa Existing business - Dividend yield Existing business Long term TSR investment growth TSR through cycle Double digit TSR from existing business Magellan| 9
Slide 10: New FUM opportunities
New FUM opportunities Self-directed High Conviction For personal use only retail Fund Global Equities US$8 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 p
Slide 11: Self-directed retail channel
Self-directed retail channel For personal use only • Estimated self-directed investable assets of ~$500bn1 Market • Estimated global equities opportunity in self-directed of $50-75bn2 opportunity • Magellan currently at ~$1.3bn • Australian self-directed investors are materially underweight global e
Slide 12: High Conviction Fund
High Conviction Fund For personal use only • Current FUM of $575 million Magellan High Conviction Fund • Concentrated portfolio which represents 1 year 23.0% our best investment ideas • Developed outstanding 5 year 3 years (% p.a.) 14.0% investment track record • Launched wholesale unit class and 5
Slide 13: Airlie retail opportunity
Airlie retail opportunity For personal use only • Launched the Airlie Australian Share Fund in June 2018 • Providing retail investors with access to one of the pre-eminent investment teams in Australian equities • Adviser fund launch roadshow across Australia and New Zealand 17-27 July 2018 – ~600 a
Slide 14: Global Listed Infrastructure
Global Listed Infrastructure For personal use only • Listed infrastructure is gaining acceptance globally as an asset class • Magellan is well positioned to grow in this area given: – Our unique approach to defining “infrastructure” – Consistency of investment returns and long term outperformance •
Slide 15: Sustainable/Low Carbon Strategies
Sustainable/Low Carbon Strategies For personal use only • Leverages Magellan’s existing intellectual capital and investment processes and Low Carbon/Sustainable overlay is targeting a real client need • Requires meaningful track record – typically minimum 3 years – Global and US strategies have been
Slide 16: Driving shareholder value
Driving shareholder value For personal use only Outstanding existing client business (FUM $74.5 billion)1 Increased cash dividends to shareholders (payout 90-95% of funds management profit after tax2) Numerous additional FUM opportunities 1. As at 28 September 2018; 2. Excluding amortisation, subjec
Slide 17: A model for long term Total Shareholder Return (TSR)
A model for long term Total Shareholder Return (TSR) For personal use only 4-5% pa 11-14% pa FUM Flows/ additional opportunities 7-9% pa Existing business - Dividend yield Existing business Long term TSR investment growth TSR through cycle Double digit TSR from existing business Magellan| 17
Slide 18: 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 19: For personal use only
For personal use only www.magellangroup.com.au Phone: +61 2 9235 4888
Magellan Financial Group — Shareholder Meeting (October 2018) on 6ix