Impax Asset Management Group plc · LSE:IPX
Impax Asset Management — Shareholder Meeting (March 2023)
51 slides from Impax Asset Management's shareholder meeting presentation, Mar 16, 2023
Slide 1: Annual General Meeting
THIS IS NOT A FINANCIAL PROMOTION Annual General Meeting 16 March 2023
Slide 2: Investing in the transition to a more sustainable economy
Investing in the transition to a more sustainable economy Investment manager – 24+ years’ experience Expertise in highly attractive areas recognised worldwide Large investment team (c.80 members) – Listed equities, fixed income, private markets Global client base of institutional & intermediary inve
Slide 3: The transition to a more sustainable economy
The transition to a more sustainable economy Secular Sectoral Attractive for “active” drivers transformation investment managers • Resource/environmental • Large-scale, affecting constraints most sectors • Regulation • High growth rates • Technology change • Uncertain impact of drivers e.g., • Evolv
Slide 4: Our principal investment strategies
Our principal investment strategies Environmental Sustainability Markets Lens Active Equities Active Equities Fixed Income Specialists Global Opportunities High Yield Bond 2002 2015 1998 Leaders US Large Cap Core Bond 2008 2016 2016 Asian Environmental US Small Cap 2009 2008 Water Asian Opportunitie
Slide 5: Global distribution
Global distribution North America Impax commingled funds Impax US mutual funds1 Desjardins AM (Canada) FÉRIQUE (Canada) Mackenzie Investments (Canada) NEI Investments (Canada) Europe Impax investment trust Impax UCITS funds Impax private markets funds ASN Bank BNP Paribas Asset Management Formueplej
Slide 6: 2022 highlights
2022 highlights Net inflows of Continued Strengthening £2.9bn, Challenging longer-term direct AUM decreased market investment distribution by 4.1% from environment outperformance2 capabilities £37.2bn1 Pensions Age “Active Manager of the Year” Environmental Finance £40.4bn AUM as at 28 Feb 2023 “Lis
Slide 7: Financial performance
Financial performance1 Financial highlights Assets under management (£bn)² FY 2022 35.7 175.4 Revenues (£m) 143.1 FY 2021 37.2 Adjusted 67.4 operating profit (£m) 3 55.8 Shareholders’ equity (£m) Adjusted 68.4 FY 2022 138.2 profit before 4 tax (£m) 54.9 FY 2021 110.5 Adjusted 42.1 diluted earnings F
Slide 8: Karen Cockburn: Chief Financial Officer
Karen Cockburn: Chief Financial Officer • Became CFO, January 2023, replacing Charlie Ridge • Joining Impax Group Board as Executive Director, 16 March 2023 • 25+ years’ experience: formerly CFO, CoFunds (part of Aegon group); Transformation CFO at Virgin Money. Qualified Chartered Accountant • Char
Slide 9: Significant opportunities available in a more challenging market environment
Significant opportunities available in a more challenging market environment • Macro-economic challenges and Ukraine conflict… ― Inflationary and interest rate pressures; monetary tightening and supply chain disruptions • …led to a market rotation towards value ― Commodities (incl. fossil fuels) ben
Slide 10: Significant opportunities available in a more challenging market environment
Significant opportunities available in a more challenging market environment • Drivers of the transition to a more sustainable economy remain strong ― Policy drivers and role of renewables for energy security: e.g. Inflation Reduction Act ― Disclosure requirements on fund managers and green taxonomi
Slide 11: Well-diversified AUM by strategy
Well-diversified AUM by strategy AUM by strategy1 AUM by principal ranges1 International Sustainable Other, 10% Economy, 2% Global Women's 64% FY 2022 Leadership, 2% Environmental Markets Leaders, 20% 70% FY 2021 US Large Cap, 4% Global Opportunities, 21% 30% Water, 15% Sustainability Lens FY 2022 2
Slide 12: Well-diversified AUM by client type
Well-diversified AUM by client type AUM by client type1 Revenue by client type1 Own label & other 38% Own label & other 53% mandates 37% mandates 53% 36% 30% BNPP AM mutual funds BNPP AM mutual funds 41% 32% Other mutual funds & 26% Other mutual funds & 17% FY 2022 FY 2022 2022 advisory advisory 22%
Slide 13: AUM by geography and asset class
AUM by geography and asset class AUM by region AUM by asset class Asia-Pacific, 2% Listed North America, 27% equities, 95% EMEA1, 50% Fixed income, 4% Private markets, 1% UK, 21% All data as at 30 September 2022. 1Includes Ireland. 13
Slide 14: Movement in net inflows – breakdown by channel (£m)
Movement in net inflows – breakdown by channel (£m) Funds sub-managed for UK/Ireland BNP Paribas Asset Management 1,123 St James's Place (517) -517 2,089 BNPP funds 4,516 50 IEM plc 192 Other EMEA distributors/funds ASN Bank, Formuepleje, (106) Lombard Odier, SEDCO Segregatedaccounts 539 Segregated
Slide 15: Movement in net inflows – breakdown by channel (£m)
Movement in net inflows – breakdown by channel (£m) North America Asia-Pacific Segregated accounts 683 Segregated 345 Own label funds1 accounts 1,245 265 Other 319 Other mutual & 68 advisory funds Other 659 68 92 Segregated accounts 120 FY 2022 FY 2021 All data as at 30 September 2022. 1Includes Pax
Slide 16: Investment strategies and products: scope for further growth
Investment strategies and products: scope for further growth 1 Expanding our current strategies • Commingled funds: (e.g Lombard Odier) • Significant capacity headroom • US Large Cap sold into Europe & APAC 2 Developing new products • Sustainable Infrastructure (Active) strategy 3 Private markets, f
Slide 17: Beyond the pursuit of financial returns
Beyond the pursuit of financial returns Policy & advocacy Thought leadership and insights Financing Greening the net-zero emissions financial system Nature and Human biodiversity loss capital Partnerships and networks 17
Slide 18: Beyond the pursuit of financial returns (continued)
Beyond the pursuit of financial returns (continued) Engagement and stewardship Reporting and analytics 18
Slide 19: Investing in our people
Investing in our people • Continued strong employee engagement score Employee headcount 30 Sep 21 • Team grew 26% 155 30 Sep 22 • Senior distribution hires: North America; Europe & APAC 120 Total 102 headcount: • Opened new Manhattan office, Tokyo office opening 272 March 23 87 • 21 participants in
Slide 20: Systems and infrastructure
Systems and infrastructure Compliance Risk • Expanding and globalising Compliance team • Strengthened our Risk function and hired ― Investment additional senior managers ― Distribution ― Oversight ― Financial Crime IT • Developed our IT platform ― Salesforce implementation ― Continued focus on data
Slide 21: Outlook
Outlook Supportive Rising Asset owner policy and environmental trends aligned regulatory and societal with “TSE” drivers challenges Established, Attractive Institutionally- investment Authenticity & diversified focused client skills/ heritage distribution base strategies network 21
Slide 22: Appendices
Appendices
Slide 23: Sustainability Lens Strategies: FY 2022 performance versus benchmark
Sustainability Lens Strategies: FY 2022 performance versus benchmark (cumulative, %)1 Global Opportunities – AUM £7.5bn US Large Cap – AUM £1.3bn US Small Cap – AUM £0.5bn Global Opportunities US Large Cap 108.3 US Small Cap 46.9 80.3 43.1 MSCI ACWI2 S&P 500 Index3 86.9 Russell 2000 Index4 28.2 49.4
Slide 24: Environmental Markets Strategies: FY 2022 performance versus benchmark
Environmental Markets Strategies: FY 2022 performance versus benchmark (cumulative, %)1 Leaders3 – AUM £7.2bn Specialists – AUM £3.5bn Water – AUM £5.5bn Leaders Specialists Water 49.5 49.4 62.6 64.1 MSCI ACWI2 MSCI ACWI2 MSCI ACWI2 49.4 49.4 26.5 38.4 33.7 23.3 23.3 23.3 -4.2 -4.2 -8.6 -4.2 -11.3 -
Slide 25: FY 2022: Breakdown of AUM increase (£bn)
FY 2022: Breakdown of AUM increase (£bn) 30-Sep-22 35.7 Outflows (4.0) Inflows 4.4 Market movement (2.8) £37.9bn AUM as at 31-Mar-22 38.0 31 Dec 2022 Outflows (3.9) Inflows 6.3 Market movement (1.7) 30-Sep-21 37.2 25
Slide 26: 23% revenue growth since 2021
23% revenue growth since 2021 Revenue (£m) Average fee margin (bps) Sep-22 Sep-21 Sep-22 run rate: run rate: run rate: £166.2m 47 bps 47 bps 47 46 FY 2022 175.4 Performance 6.8 Net flows 25.6 FY 2021 143.1 FY 2021 FY 2022 26
Slide 27: Revenue diversification
Revenue diversification Revenue by strategy Revenue by region Asia Pacific, 2% North America, Others, 14% 35% Leaders, 22% EMEA1, International Sustainable 46% Economy, 2% Global Women's Leadership, 2% US Large Cap, UK, 17% 4% Global Water, 12% Opportunities, Revenue by client type2 12% Sustainable
Slide 28: Operating expenses: investment to support growth
Operating expenses: investment to support growth Adjusted operating expenses (£m) Total staff (average)1 FY 2022 108.0 FY 2022 71 169 240 Variable Staff costs 7.2 Fixed staff costs 8.3 FY 2021 62 133 195 Non-staff costs 5.2 Investment Staff Other Staff FY 2021 87.3 AUM per investment staff member (£
Slide 29: 21% operating profit increase in 12 months
21% operating profit increase in 12 months Operating profit1 (£m) Operating margin FY 2022 67.4 FY 2022 38.4% FY 2021 39.0% FY 2021 55.8 • 30 Sept 2022 run rate operating profit: £54.1m • 30 Sept 2022 run-rate operating margin: 32.6% Operational gearing trend Operating profit per average staff membe
Slide 30: Strong cash position and robust capital buffer
Strong cash position and robust capital buffer Dividend (p) Cash movements¹ (£m) Capital resources (£m) 70.9 70.9 FY 2022 106.9 Other 2022 4.7 22.94 27.6 assets 0.2 Other cash 4.3 movements 2021 3.6 17.0 20.6 Net redemption 0.4 Capital of investments 48.1 buffer 2020 1.8 6.8 8.6 Acquisition of 63.4
Slide 31: IPX shareholder register
IPX shareholder register IPX shares September 2022 (m) Share management • EBT purchased 1,078,000 shares in the period • Continuation of EBT purchasing policy IPX shares in issue 132.6 Current ownership 30 September 2022 Shares held in EBT (3.3) BNP Paribas Asset Management 14% Net IPX shares 129.3
Slide 32: Adjusted IFRS performance measures
Adjusted IFRS performance measures IFRS PBT to adjusted PBT (£m) As a result of the acquisition, certain financial performance measures have been prepared on an adjusted basis. ‘Adjusted’ financial metrics are shown after removing the effects of primarily: Adjusted PBT 68.4 • Foreign exchange gains
Slide 33: Additional information
Additional information Share awards outstanding1 Awards Number outstanding Vesting date End of exercise period RSS 2,494,007 2022-2027 RSU 2,436 2023 ESOP 700,000 Vested 2023 LTOP 1,993,575 2024-2027 2029-2032 Total 5,190,018 Investments Theme Principal funds/investee Investments (£m) % of fund aum
Slide 34: Strong track record of growth – assets under management (£m)
Strong track record of growth – assets under management (£m) 1998 15 1999 20 2000 39 2001 38 2002 55 2003 66 2004 69 2005 214 2006 429 2007 982 2008 1,099 2009 1,265 2010 1,823 2011 1,896 2012 1,828 2013 2,197 2014 2,755 2015 2,823 2016 4,502 2017 7,261 2018 12,515 2019 15,051 2020 20,183 2021 37,21
Slide 35: NEF III status
NEF III status • €2611 million invested and committed in a diversified portfolio ― 12 investments in eight countries across four technologies ― Four development platforms ― First investment in an adjacent sector: battery storage • Over 100% invested, committed and reserved for the execution of the i
Slide 36: NEF IV status
NEF IV status • Second rolling close held in Sep. and Oct. 2022 with additional commitments of €55.3m bringing total commitments to €293.3m ― c. 60% of €500m target fund size raised • Eight investments within nine months of the first close (Oct. 2021) ― Investments in six countries across four techn
Slide 37: Disclosures and important information
Disclosures and important information
Slide 38: NEF Performance notes
NEF Performance notes IRR, multiples and other return calculations All Internal Rates of Return ("IRR"), multiples and other return or performance information calculations include realised values and unrealised values, as applicable and include all returns generated by reinvested capital and proceed
Slide 39: Leaders: GIPS report – GBP
Leaders: GIPS report– GBP Total Firm Assets Composite Assets Number of Annual Gross Annual Net MSCI AC World Asset Weighted 3yr Annualized MSCI AC World 3yr FTSE EOAS 3yr Year (Millions) (Millions) Portfolios Return Return Return FTSE EOAS Return StdDev* Std Dev** Annualized Std Dev** Annualized Std
Slide 40: Climate: GIPS report – GBP
Climate: GIPS report – GBP Benchmark 3yr Total Firm Assets Composite Assets Number of Annual Gross Annual Benchmark Asset Weighted 3yr Annualized Std Annualized Std Year (Millions) (Millions) Portfolios Return Annual Net Return Return StdDev* Dev** Dev** 2021 39,788.29 3,584.90 4 17.77 17.13 19.63 -
Slide 41: Water: GIPS report – GBP
Water: GIPS report – GBP FTSE EO Water 3yr MSCI AC World FTSE EO Water Total Firm Assets Composite Number of Annual Gross Annual Net MSCI AC World Technology Asset Weighted Annualized 3yr Annualized Technology 3yr Year (Millions) Assets (Millions) Portfolios¹ Return Return Annual Return Annual Retur
Slide 42: Asian Environmental: GIPS report – GBP
Asian Environmental: GIPS report – GBP MSCI AC AP 3yr FTSE EO AP 3yr Total Firm Composite Number of Annual Gross Annual Net MSCI AC AP FTSE EO AP Asset Weighted 3yr Annualized Annualized Std Annualized Std Year Assets (Millions) Assets (Millions) Portfolios Return Return Return Return StdDev* Std De
Slide 43: Global Opportunities: GIPS report – GBP
Global Opportunities: GIPS report – GBP Benchmark 3yr Total Firm Assets Composite Assets Number of Annual Gross Annual Benchmark Asset Weighted 3yr Annualized Std Annualized Std Year (Millions) (Millions) Portfolios Return Annual Net Return Return StdDev* Dev** Dev** 2021 39,788.29 7,157.93 14 21.80
Slide 44: Sustainable Food: GIPS report – GBP
Sustainable Food: GIPS report – GBP Total Firm Assets Composite Assets Annual Benchmark Asset Weighted 3yr Annualized Std Benchmark 3yr Year (Millions) (Millions) Number of Portfolios Annual Gross Return Annual Net Return Return StdDev* Dev** Annualized Std Dev** 2021 39,788.29 1,447.61 1 13.95 13.5
Slide 45: Specialists: GIPS report – GBP
Specialists: GIPS report – GBP MSCI AC World 3yr FTSE ET 3yr Total Firm Assets Composite Assets Number of Annual Gross MSCI AC World Asset Weighted 3yr Annualized Std Annualized Std Annualized Std Year (Millions) (Millions) Portfolios¹ Return Annual Net Return Return FTSE ET Return StdDev* Dev** Dev
Slide 46: Specialists: GIPS report cont.
Specialists: GIPS report cont. Calculation Methodology performance returns was only applicable to Impax Asset Management, whilst since November 2018 the highest fee Returns are calculated using the asset-weighted method and individual portfolios are revalued daily or monthly, used for the computatio
Slide 47: US Large cap: GIPS report – GBP
US Large cap: GIPS report – GBP S&P 500 3yr Total Firm Assets Composite Assets Number of Annual Gross Annual Net S&P 500 Annual Asset Weighted 3yr Annualized Annualized Std Year (Millions)* (Millions) Portfolios Return Return Return StdDev** Std Dev*** Dev*** 2021 39,788.29 1,158.66 1 33.02 32.29 29
Slide 48: US Small Cap: GIPS report – GBP
US Small Cap: GIPS report– GBP Russell 2000 3yr Total Firm Assets Composite Assets Number of Annual Gross Russell 2000 Asset Weighted 3yr Annualized Std Annualized Std Year (Millions)* (Millions) Portfolios Return Annual Net Return Annual Return StdDev** Dev*** Dev*** 2021 39,788.29 546.63 1 32.96 3
Slide 49: Core Bond strategy: GIPS report – GBP
Core Bond strategy: GIPS report – GBP Bloomberg Bloomberg Barclays US Barclays US Aggregate 3yr Total Firm Assets Composite Assets Number of Annual Gross Aggregate Annual Asset Weighted 3yr Annualized Std Annualized Std Year (Millions)* (Millions) Portfolios Return Annual Net Return Return StdDev**
Slide 50: High Yield strategy: GIPS report – GBP
High Yield strategy: GIPS report– GBP ICE BofA US Cash ICE BofA US Cash Pay High Yield Pay High Yield Constrained (BB- Total Firm Assets Composite Assets Number of Annual Gross Constrained (BB- Asset Weighted 3yr Annualized Std B) 3yr Annualized Year (Millions)* (Millions) Portfolios Return Annual N
Slide 51: Important information
Important information NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN OR INTO, ANY JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF SUCH JURISDICTION The information contained in this confidential document (the “Presentation”) a
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