Invesco Ltd · NYSE:IVZ
Invesco — Q2 2023 Earnings Presentation
23 slides from Invesco's earnings presentation, Jul 25, 2023
Slide 1: Second Quarter 2023 Results
Second Quarter 2023 Results Andrew R. Schlossberg President and Chief Executive Officer Allison Dukes Chief Financial Officer July 25, 2023
Slide 2: Forward-looking statements and Important Information
Forward-looking statements and Important Information This presentation, and comments made in the associated obligation to update the information in any public disclosure if any conference call today, may include “forward-looking statements.” forward-looking statement later turns out to be inaccurate
Slide 3: Second quarter 2023 highlights
Second quarter 2023 highlights Q2’22 Q1’23 Q2’23 Key Capability Q2’23 Key Metrics Q2’22 Q1’23 Q2’23 Q2’23 Business Highlights Area Ending AUM ETFs, Factors $554B1 ETF net LT inflows have been positive for 11 of the past Net LT Flows (billions) ($6.8) $2.9 ($2.0) and Index 12 quarters. QQQM has grown
Slide 4: Investment performance as of June 30, 2023
Investment performance as of June 30, 2023 % of actively managed assets in top half of peer group or beating benchmark Overall US Equity Global & Int’l Equity Fixed Income Alternatives Balanced 100 80 60 98% 88% 40 83% 85% 74% 74% 75% 67% 66% 66% 71% 70% 61% 64% 52% 53% 50% 48% 47% 20 42% 38% 34% 31
Slide 5: Assets under management & long-term flows
Assets under management & long-term flows (in billions) AUM Total Firm AUM by Investment Approach AUM by Channel 69% 68% 66% 31% 32% 34% 65% 62% 63% 35% 38% 37% $1,538 $1,017 $969 $1,390 $1,483 $958 $1,005 $899 $925 $558 $570 $478 $522 $492 $433 Total Firm Active Passive Retail2 Institutional3 Long-
Slide 6: Assets under management & long-term flows (continued)
Assets under management & long-term flows (continued) (in billions) AUM by Geography AUM by Asset Class 70% 71% 72% 16% 15% 14% 14% 13% 13% 14% 13% 12% 5% 5% 4% 46% 47% 49% 22% 22% 21% 12% 14% 15% $1,056 $1,113 $696 $747 $974 $645 $309 $322 $319 $200 $186 $182 $212 $226 $224 $229 $222 $164 $192 $199
Slide 7: Invesco's Private Alternatives Platform consists of Direct Real Estate and Private Credit
Invesco’s Private Alternatives Platform consists of Direct Real Estate and Private Credit $182 billion alternatives platform with ~$110 billion of private alternatives AUM Significant scale and breadth of capabilities in direct real estate Strong foundation in senior loans that can be expanded into
Slide 8: Our $72B Direct Real Estate business is well diversified
Our $72B Direct Real Estate business is well diversified across geographies, investment vehicles, and property types AUM by Geography AUM by Vehicle Type 32% of AUM outside the Americas Open end funds United States EMEA Closed end funds 11% APAC Inst separate accounts 39% 21% 15% of the total portfo
Slide 9: Global institutional long-term flows & pipeline
Global institutional long-term flows & pipeline (in billions) Global Institutional LT Flows Won Not Funded Pipeline by Type of Mandate (% AUM) 100% = $22 billion $25.2 $24.6 $24.6 $21.4 $20.8 23% $19.0 $16.9 $6.6 23% $3.9 $1.5 $0.9 ($2.2) 14% ($17.5) ($17.5) ($18.0) ($19.1) ($19.9) 14% Q2’22 Q3’22 Q
Slide 10: Revenues and expenses
Revenues and expenses (in millions) Net Revenues Adjusted Operating Expenses -7.1% 3.5% Q2’22 vs Q2’23 $83 million decrease $27 million increase $1,174 -$90 $1,091 -$12 +$10 -$8 +$17 $789 $762 +$32 -$4 +$2 -$3 Q2’22 Investment Service & Performance Other Third- Q2’23 Q2’22 Employee Marketing Propert
Slide 11: Adjusted operating income and profitability
Adjusted operating income and profitability (in millions, except margin and per share information) Adjusted Operating Income and Adjusted Operating Adjusted Net Income and Adjusted Diluted Earnings Margin Per Share Excluding $27 million of Excluding $27 million of expenses related to expenses relate
Slide 12: Capital management
Capital management (in millions, except ratio information) Capital Returned to Shareholders Leverage Ratio** $301 $150 3.19x 3.41x 3.33x $145 $145 $145 $145 2.58x 2.76x $59 $59 $59 $59 $59 0.69x 0.67x 0.78x 0.83x 0.66x $86 $86 $86 $86 $92 Q2’22 Q3’22 Q4’22 Q1’23 Q2’23 Q2’22 Q3’22 Q4’22 Q1’23 Q2’23 C
Slide 13: Conclusion
Conclusion • Resilient net flows performance, led by growth in key capabilities o Global ETF business gaining market share, 9% organic growth rate in the quarter o China joint venture returned to net inflows, with $1.9 billion o Fixed income net flows positive for the 18 th straight quarter o Net ou
Slide 14: Appendix
Appendix 4 Invesco 14
Slide 15: We are diversified as a firm
We are diversified as a firm By Client Domicile By Channel By Asset Class 4% 12% 13% 15% 72% 63% 37% 49% 14% 21% 1-Yr 1-Yr 1-Yr (billions) Change (billions) Change (billions) Change Americas $1,112.8 14.3 % Retail $968.5 7.8 % Equity $747.1 15.9 % Asia Pac $221.9 (1.1)% Institutional $569.7 15.9 % F
Slide 16: Investment performance by investment objective (actively managed assets)
Investment performance By investment objective (actively managed assets)* AUM above benchmark 1st quartile 2nd quartile Equities U.S. Core U.S. Growth U.S. Value Sector 100% 100% 100% 100% 39% 100% 99% 61% 46% 22% 62% 61% 61% 33% 55% 39% 24% 61% 31% 50% 55% 41% 43% 43% 28% 31% 4% 1% 22% 24% 25% 24%
Slide 17: Investment performance by investment objective (actively managed assets)
Investment performance By investment objective (actively managed assets)* AUM above benchmark 1st quartile 2nd quartile Equities Other Global Global ex-U.S. and Em. Mkts. Alternatives Balanced 100% 100% 100% 100% 21% 8% 54% 56% 2% 17% 46% 85% 99% 99% 99% 9% 65% 75% 77% 72% 35% 8% 66% 66% 65% 60% 55%
Slide 18: US GAAP and Non-GAAP operating results Q2-23 vs. Q1-23
US GAAP and Non-GAAP operating results Q2-23 vs. Q1-23 US GAAP Basis Non-GAAP Basis (in millions) Q2-23 Q1-23 % Change (1) (in millions) Q2-23 Q1-23 % Change (1) Investment management fees $1,033.5 $1,027.9 0.5% Investment management fees $1,183.8 $1,182.4 0.1% Service and distribution fees 342.3 33
Slide 19: Reconciliation of US GAAP results to Non-GAAP results, three months ended June 30, 2023
Reconciliation of US GAAP results to Non-GAAP results Three months ended June 30, 2023 Please refer to pages 7-10 in the 2Q 2023 earnings press release for a description of the adjustments Consolidation 3rd party distribution, Transaction, Market appreciation / Consolidated of joint service and advi
Slide 20: Reconciliation of US GAAP results to Non-GAAP results, three months ended March 31, 2023
Reconciliation of US GAAP results to Non-GAAP results Three months ended March 31, 2023 Please refer to pages 7-10 in the 1Q 2023 earnings press release for a description of the adjustments Consolidation 3rd party distribution, Transaction, Market appreciation / Consolidated of joint service and adv
Slide 21: Reconciliation of US GAAP results to Non-GAAP results
Reconciliation of US GAAP results to Non-GAAP results (in millions) Q2'21 Q3'21 Q4'21 Q1'22 Q2'22 Q3'22 Q4'22 Q1'23 Q2'23 Operating revenues $1,721.4 $1,750.0 $1,763.4 $1,629.4 $1,530.4 $1,445.7 $1,443.4 $1,418.2 $1,442.8 Non-GAAP adjustments (418.5) (416.5) (389.7) (377.0) (356.5) (335.1) (335.3) (
Slide 22: Footnote disclosures
Footnote disclosures Footnotes for Slide 3, Second quarter 2023 highlights Non-GAAP financial measures - For the reconciliations from US GAAP to non-GAAP measures, see the Appendix to this presentation and the non-GAAP Information and Reconciliations section of the current earnings release. Addition
Slide 23: Footnote disclosures (continued)
Footnote disclosures (continued) Footnotes for Slide 12, Capital management Non-GAAP financial measures – For the reconciliations from US GAAP to non-GAAP measures, see the Appendix to this presentation and the non-GAAP Information and Reconciliations section of the current earnings release. Additio