Pacific Current Group Ltd · ASX:PAC
Pacific Current — Treasury Group — Shareholder Meeting (November 2012)
32 slides from Pacific Current's shareholder meeting presentation, Nov 2, 2012
Slide 1: Treasury Group Limited Annual General Meeting
Treasury Group Limited Annual General Meeting 2 November 2012
Slide 2: Agenda
Agenda 1. Chairman’s address 2. Review of 2012 outcomes 3. Boutique case studies 4. Strategy 5. TRG Investment proposition 6. Formal items of business 2
Slide 3: Chairman's Address - Results Overview
Chairman’s Address - Results Overview From 2012, Treasury Group has emerged more efficient, focused and in a stronger position to pursue further growth opportunities • FUM at June 2012- $16.4bn, 2.3% down on previous year • Underlying NPAT $8.1m, down 17.0% year on year • Positive funds inflows • St
Slide 4: Chairman's Address – a year of change and consolidation
Chairman’s Address – a year of change and consolidation TAAM Results of GVI - Additional working Strategic restructured/ capital investment Review Aubrey - Changes in TRG Non-Exec announced New CEO appointed Investment team Director PRV appointed manager of appointed restructuring Andrew GVI funds U
Slide 5: Chairman's Address - Dividends
Chairman’s Address - Dividends Dividend History 50 45 • Full year dividends of 34 cps full 40 franked 35 30 cps • Balance sheet liquid and ungeared 25 • Cash, Available for Sale 20 Investments and Loans to 15 Partner Boutiques totaled 10 $21.7m at 30 June 5 0 2009 2010 2011 2012 Interim Final 5
Slide 6: Chairman's Address - Industry funds flow
Chairman’s Address - Industry funds flow Australian Managed Funds Industry Quarterly Funds Flows $bn Source: Morningstar Funds Flows ; Industry = Australia Funds ex ETF 6
Slide 7: Agenda
Agenda 1. Chairman’s address 2. Review of 2012 outcomes 3. Boutique case studies 4. Strategy 5. TRG Investment proposition 6. Formal items of business 7
Slide 8: Review of 2012 - re-focused strategy, tough decisions taken
Review of 2012 - re-focused strategy, tough decisions taken • Year of consolidation; - Restructuring of GVI and AR Capital - PRV issues addressed - Improved efficiency and lower costs at Treasury Group. Headcount down 24% during year, ongoing employment costs down $1.3m pa. • Underlying earnings dow
Slide 9: Review of 2012 - Total Shareholder Return
Review of 2012 - Total Shareholder Return Total Shareholder Return TRG vs S&P/ASX 300 +11.5% Index (Jul 11=100) -7.0% Source: Morningstar, Closed prices– Base 100 at close of 30/06/2011, daily data TR = Total Return – Dividend reinvested net of tax 9
Slide 10: Review of 2012 - Financial Results
Review of 2012 - Financial Results P&L Highlights ($m) 2012 2011 % Change • Funds inflows of $445m offset by market Year end FUM ($bn) 16.4 16.7 -2.3 value declines Aggregate Boutique Mgmt Fees ($m) 71.0 74.9 -5.2 Revenue 3.945 4.493 -12.2 • TRG Revenues lower due to lower interest income and reduct
Slide 11: Review of 2012 - Business Segment Results
Review of 2012 - Business Segment Results Contribution to Change in NPAT (FY11 vs FY12) 12.0 10.005 10.0 0.707 8.0 6.752 (2.545) 0.024 (0.115) (1.324) $m 6.0 4.0 2.0 0.0 FY11 Australian International Alternative Overhead, One off items FY12 Equities Equities Equities Outsourcing, RE Services 11
Slide 12: Review of 2012 - Funds Under Management
Review of 2012 - Funds Under Management Composition of Yr End FUM vs Average Margin 18 80 16 70 14 60 Trilogy 12 Evergreen & AR Capital 50 Celeste 10 Avg Margin TAAM FUM 40 (bps) $bn 8 Aubrey & GVI 30 RARE Infrastructure 6 Orion 20 Investors Mutual 4 % incl Trilogy 2 10 % excl Trilogy 0 0 12
Slide 13: Review of 2012 - Boutiques
Review of 2012 - Boutiques Boutiques • Outstanding year for IML and Celeste – Strong investment performance – Funds inflows (institutional and retail) – Multiple Fund Manager of the Year awards – Ratings upgrades • Strong initial ratings for Aubrey, Octis and Evergreen • Funds inflows at RARE • Issu
Slide 14: Agenda
Agenda 1. Chairman’s address 2. Review of 2012 outcomes 3. Boutique case studies 4. Strategy 5. TRG Investment proposition 6. Formal items of business 14
Slide 15: Boutique case studies – selected star fund performers
Boutique case studies – selected star fund performers Investors Mutual Limited • Positive funds flows • Institutional inflows during 2012 and 1Q13 Australian Share fund • Retail flows positive and improving Performance to end Q1 FY2013 • FUM in excess of $3.0bn Fund Return S&P/ASX 300 Acc Period • R
Slide 16: Boutique case studies – selected star fund performers
Boutique case studies – selected star fund performers RARE Infrastructure • Performance going from strength to strength • Positive funds flows – institutional and retail Infrastructure Value Fund inflow during 2012 and 1Q13 Performance to end Q1 FY2013 • FUM in excess of $5.0bn Fund Return OECD G7 I
Slide 17: Agenda
Agenda 1. Chairman’s address 2. Review of 2012 outcomes 3. Boutique case studies 4. Strategy 5. TRG Investment proposition 6. Formal items of business 17
Slide 18: Strategy – progress during 2012
Strategy – progress during 2012 • 2 boutiques restructured: GVI, AR Capital • 2 new boutiques added to portfolio: Evergreen, Octis • Treasury Group cost base reduced – headcount down 24%, ongoing employment costs down $1.3m pa – Mature boutiques taking increased responsibility for their own administ
Slide 19: Strategy – performance versus opportunities nominated last year
Strategy – how did we perform verses opportunities nominated last year? 2012 Opportunities • Expand and diversify portfolio of boutiques • Invest in distribution and marketing capability • Pursue efficiency and returns from support services • Optimise investment structures where possible (ope
Slide 20: Agenda
Agenda 1. Chairman’s address 2. Review of 2012 outcomes 3. Boutique case studies 4. Strategy 5. TRG Investment proposition 6. Formal items of business 20
Slide 21: TRG Investment Proposition – leverage to large, growing industry
TRG Investment Proposition – leverage to large, growing industry Australian Funds Management Industry is large and high growth 9% pa growth projected 2012-15 $2.6tn $2.0tn $500bn $1.6tn 2000 2009 2012 2015 • Australian industry is largest in the Asia Pacific Region and 4th largest in the world • Gro
Slide 22: TRG Investment Proposition - superior long term performance
TRG Investment Proposition - superior long term performance Performance Since Inception (%pa) – Net of Fees to end June 2012 Net Inception Selected Funds Alpha Sample Ratings Return Date Aubrey Global Conviction(GBP) +3.5% +0.7 Jan 2007 Zenith- Recommended Celeste Australian Small +16.5% +11.4 May 1
Slide 23: TRG Investment Proposition – compelling business economics
TRG Investment Proposition – compelling business economics Typical Long Only Equities Boutique Economics Revenue Profit Break even • Break even typically around FUM level $200m FUM for long only equities $000s • Profits in 10’s of $millions when FUM exceeds $3.0bn Costs FUM Start up Exponential Loss
Slide 24: TRG Investment Proposition
TRG Investment Proposition Why you should feel confident investing in TRG? • Australia’s premier partner for boutique fund managers • Specialised business model attracts “best of breed managers” and leverages their capabilities • Risk-based approach via portfolio diversification strategy • Strong le
Slide 25: Summary
Summary • Investors remain cautious favouring low risk assets and low risk investment styles • Long term fundamentals for funds management remain fundamentally attractive – Australian industry large and high growth • Year of consolidation for Treasury Group, tough decisions taken • Underlying financ
Slide 26: Agenda
Agenda 1. Chairman’s address 2. Review of 2012 outcomes 3. Boutique case studies 4. Strategy 5. TRG Investment proposition 6. Formal items of business 26
Slide 27: Formal Items of Business
Formal Items of Business Item 1: Financial statements and reports “To receive and consider the Financial Report, the Directors’ Report and the Auditor’s Report for the year ended 30 June 2012” 27
Slide 28: Formal Items of Business
Formal Items of Business Item 2: Re-election of Mr Reub Hayes “That Mr Reub Hayes, a Director retiring by rotation in accordance with the Company’s constitution and offering himself for re-election, be re-elected as a Director of the Company.” Proxies have been received in respect of the resolution
Slide 29: Formal Items of Business
Formal Items of Business Item 3: Election of Ms Melda Donnelly “That Ms Melda Donnelly, who is offering herself for election be elected as a Director of the Company.” Proxies have been received in respect of the resolution as follows: In favour Against Abstention Proxy’s Discretion 7,723,196 262,492
Slide 30: Formal Items of Business
Formal Items of Business Item 4: Adoption of Remuneration Report “To adopt the remuneration report forming part of the Directors’ Report for the financial year ended 30 June 2012” Proxies have been received in respect of the resolution as follows: In favour Against Abstention Proxy’s Discretion 4,53
Slide 31: Chairman's address, Review of 2012 outcomes, Boutique case studies
1. Chairman’s address 2. Review of 2012 outcomes 3. Boutique case studies 4. Strategy 5. TRG Investment proposition 6. Formal items of business 7. Questions and Answers
Slide 32: Disclaimer
Disclaimer The information in this presentation is general background information about Treasury Group Limited and is current only at the date of this presentation. In particular, this presentation: • is not an offer or recommendation to purchase or subscribe for securities in Treasury Group limited