Impax Asset Management Group plc · LSE:IPX
Impax Asset Management — H1 2020 Earnings Presentation
34 slides from Impax Asset Management's earnings presentation, June 2020
Slide 1: Interim results for six months to 31 March 2020
Interim results for six months to 31 March 2020 The specialist asset manager focused on a more sustainable economy
Slide 2: Agenda
Agenda • Highlights Ian Simm Charlie Ridge Founder & Chief Executive Chief Financial Officer • Business update • Financial update • Appendix 2
Slide 3: H1 2020 highlights
H1 2020 highlights Strong organic Resilient AUM down but growth with Robust investment performance sharp recovery in positive net performance through C-19 crisis early H2 inflows (£1.8bn) 30 April 2020 AUM1 - £15.8 billion 1Assets under advice represent ~2.5% of total AUM. 3
Slide 4: Financial performance
Financial performance1 H1 2020 H2 2019 H1 2019 Assets under management2 £14.4bn £15.1bn £13.3bn Revenue £41.2m £39.9m £33.8m Adjusted operating earnings3 £10.5m £10.3m £7.7m Adjusted profit/(loss) before tax £10.1m £10.9m £7.2m Adjusted diluted earnings per share 6.3p 7.1p 4.4p Shareholders’ equity
Slide 5: Business update
Business update
Slide 6: Response to the Covid-19 Crisis
Response to the Covid-19 Crisis • All staff working from home since late March, with frequent intra-team and "all hands" communication • Extension of existing "business continuity" provisions successful • Intensive client communications programme; Impax portfolios generally seen as resilient and wel
Slide 7: Impax Asset Management - overview
Impax Asset Management - overview Thematic Equities £10.1bn Fixed Income US Equities £790m £790m £14.5bn AUM£14.4bn 30 April 2020 1 AUM1 AUM - £15.8 billion Infrastructure Global Opportunities (New Energy) £1.3bn £360m Beta Strategies £1.0bn London managed // US managed 1As at 31 March 2020. Assets
Slide 8: AUM growth by client domicile
AUM growth in Europe and North America – breakdown by client domicile (£m) PRINCIPAL FUNDS/PARTNERS Impax Environmental Markets plc 2,199 UK/Ireland Irish UCITS Platform 1,601 St James’s Place 7,274 Formuepleje EMEA ASN Bank 8,031 Impax LN managed BNP Paribas Asset Management 94 Asia-Pacific BNP Par
Slide 9: AUM growth by investment strategy
AUM growth – breakdown by investment strategy (£m) Specialists 2,600 2,691 Leaders 3,186 3,512 Impax LN managed Asia-Pacific 379 273 Water 3,422 3,829 Sustainable Food Food & Agriculture 539 740 Unconstrained Global Equities 1,310 611 Private Equity Infrastructure 363 445 Impax NH managed US Equitie
Slide 10: Integration and development of Impax NH business
Integration and development of Impax NH business • Positive monthly net inflows for Impax NH over the Period • Plan to fully integrate North American operations has commenced (initial focus on sales) • Strong staff engagement; further integration of Support Teams completed • New "balanced fund" mand
Slide 11: Breakdown of AUM increase
Breakdown of AUM increase IMPAX LN: LISTED EQUITY FUNDS (£m)1 IMPAX NH: PAX WORLD FUNDS (£m)1 31 March 2020 11,435 31 March 2020 3,306 Market movement (2,125) Market movement (487) Inflows 3,608 Inflows 541 Outflows (1,704) Outflows (407) 30 September 30 September 11,656 3,659 2019 2019 Market movem
Slide 12: Private Equity Infrastructure
Private Equity Infrastructure NEF III INVESTMENTS NEF III (2016, €357m)1 30MW + • €210 million invested and committed in projects 38MW • Eight investments in five countries across three technologies and ownership of three development teams • Over 500MW in an advanced stage towards construction or op
Slide 13: Financial update
Financial update Adjusted performance measures presented. Reconciliation to IFRS on slide 22
Slide 14: Financial highlights - revenue
Financial highlights - revenue IMPAX LN (£m) IMPAX NH1 (£m) H1 2020 30.1 H1 2020 11.1 Listed Equity Listed Equity flows flows 2.1 and performance Flows and NEF 2 Fund wind performance 0.3 (0.3) down Prior year Prior year Private Private Equity items not Equity and Property (0.8) repeated items not r
Slide 15: Financial highlights - operating expenses
Financial highlights - operating expenses IMPAX LN (adjusted1) (£m) IMPAX NH (adjusted1) (£m) H1 2020 5.4 7.3 7.8 20.5 H1 2020 4.7 4.2 1.2 10.1 H2 2019 5.3 6.5 7.6 19.4 H2 2019 5.1 4.0 1.1 10.2 H1 2019 4.7 6.0 5.7 16.4 H1 2019 4.4 4.1 1.2 9.7 Non-staff costs Fixed staff costs Variable staff costs •
Slide 16: Financial highlights - trends
Financial highlights - trends LN AVERAGE NUMBER OF EMPLOYEES NH AVERAGE NUMBER OF EMPLOYEES 31 March H1 2020 107 31 March H1 2020 2020 59 30 September H2 2019 95 30 September H2 2019 2019 56 LN ADJUSTED OPERATING COSTS PER EMPLOYEE (£’000) NH ADJUSTED OPERATING COSTS PER EMPLOYEE (£’000) H1 2020 31
Slide 17: Financial highlights - earnings and dividends
Financial highlights - earnings and dividends ADJUSTED DILUTED EPS (p) DIVIDEND (p) 2020 1.8 EPS H1 2020 6.3 2019 1.5 4.0 5.5 2018 1.1 3.0 4.1 2.6 Operating profit 0.2 2017 0.7 2.2 2.9 2016 0.5 1.6 2.1 FV and FX gains not repeated (1.0) 2015 0.4 1.2 1.6 0.5 2014 0.1 1.1 1.2 Interim EPS H2 2019 7.1 2
Slide 18: Financial highlights - balance sheet
Financial highlights - balance sheet CASH MOVEMENTS1 (£m) CASH RESERVE ANALYSIS1 (£m) 31 March 2020 19.9 31 March 2020 19.9 Investment in NEF III (0.7) Acquisition of own Risk buffer (10.5) (3.2) shares Other cash movements (0.2) "Available" cash 9.4 Dividends paid (5.1) Working capital (8.4) Interi
Slide 19: IPX shareholder register
IPX shareholder register IPX SHARES MARCH 2020 (m) POTENTIAL DILUTION (IN 2021) • The 16.7% of Impax NH owned by management can be purchased IPX issued shares 130.4 with either cash or equity. A purchase with equity would equate to 1.0m¹ shares. Net EBT purchases to date (5.6) CURRENT OWNERSHIP Net
Slide 20: Impax's strong position
Impax’s strong position Acknowledged Attractive Established leading global investment distribution brand skills/strategies network Potential for Scope to Building further develop/add shareholder scaling new capabilities value 20
Slide 21: Appendix
Appendix
Slide 22: Adjusted 'IFRS' performance measures
Adjusted ‘IFRS’ performance measures IFRS PBT TO ADJUSTED PBT (£m) As a result of the acquisition, certain financial performance Adjusted PBT 10.1 measures have been prepared on an adjusted basis. ‘Adjusted’ financial metrics are shown after removing the effects of primarily: Fair value gains/(losse
Slide 23: Acquisition transaction summary
Acquisition transaction summary On 18 January 2018 Impax completed the purchase of Pax World Management LLC (renamed Impax Asset Management LLC, here referred to as “Impax NH”) ― 83.3 per cent from majority shareholder and others ― 16.7 per cent from Pax Management in 2021 under put/call arrangement
Slide 24: Income analysis
Income analysis IFRS Adjustments for Adjusted for Period ended Period ended Period ended March March March 2020 2020 2020 Income statement £'000 £'000 £'000 Comments on adjustments Revenue 41,191 - 41,191 Operating costs (32,851) 2,152 (30,699) Amortisation of intangibles and mark to market National
Slide 25: Additional information
Additional information SHARE AWARDS OUTSTANDING INVESTMENTS END OF 1 % OF NUMBER VESTING DATE EXERCISE PRINCIPAL INVESTMENTS AWARDS STRATEGY FUND COMMENTS OUTSTANDING PERIOD FUNDS/INVESTEE (£M) AUM 2014 ESOP 600,000 Vested 31/12/2020 Global Global Women’s 1.5 100% 2015 ESOP 200,000 Vested 31/12/2020
Slide 26: Global Opportunities strategy
Global Opportunities strategy 180 • Investing across the transition to a more Global Opportunities strategy 160 sustainable global economy MSCI ACWI 140 • Broader approach than Thematic Equity 120 strategies (ca.25% overlap with Leaders) 100 • Targeting MSCI ACWI + 250 bp annualised, 80 gross of fee
Slide 27: Our offices and distribution partners
Our offices and distribution partners North America UK/Ireland Pax World Funds IEM plc Delaware funds platform UCITS platform NEI Investments St James’s Place Desjardins Global Asset Management Mackenzie Investments London Portland Asia - Pacific Portsmouth BNP Paribas in Hong Kong, Japan and Austra
Slide 28: Global Opportunities: annual disclosure presentation
Global Opportunities: annual disclosure presentation – March 2020 USD Benchmark 3yr Total Firm Assets Ending Market Number of Annual Gross Annual Benchmark Asset Weighted 3yr Annualized Std Annualized Std Year (Millions) Value (Millions) Portfolios Return Annual Net Return Return StdDev* Dev** Dev**
Slide 29: Specialists: annual disclosure presentation
Specialists: annual disclosure presentation – March 2020 USD MSCI AC World FTSE ET 3yr Total Firm Assets Ending Market Number of Annual Gross Annual Net MSCI AC World Asset Weighted 3yr Annualized 3yr Annualized Annualized Std Year (Millions) Value (Millions) Portfolios¹ Return Return Return FTSE ET
Slide 30: Leaders: annual disclosure presentation
Leaders: annual disclosure presentation – March 2020 USD Annual Annual Benchmark 1 3yr Benchmark 2 3yr Total Firm Assets Ending Market Number of Annual Gross Annual Net Benchmark 1 Benchmark 2 Asset Weighted 3yr Annualized Annualized Std Annualized Std Year (Millions) Value (Millions) Portfolios Ret
Slide 31: Asia-Pacific: annual disclosure presentation
Asia-Pacific: annual disclosure presentation – March 2020 USD Total Firm MSCI AC AP FTSE EO AP Assets Ending Market Number of Annual Gross Annual Net MSCI AC AP FTSE EO AP Asset Weighted 3yr Annualized 3yr Annualized 3yr Annualized Year (Millions) Value (Millions) Portfolios Return Return Return Ret
Slide 32: Water: annual disclosure presentation
Water: annual disclosure presentation – March 2020 USD FTSE EO FTSE EO Total Firm MSCI AC World Water Ending Market Number of Annual Gross Annual Net MSCI AC World Water Asset Weighted 3yr Annualized Year Assets 3yr Annualized Technology 3yr Value (Millions) Portfolios Return Return Annual Return Te
Slide 33: Sustainable Food: annual disclosure presentation
Sustainable Food: annual disclosure presentation – March 2020 USD Benchmark 1 3yr Total Firm Assets Ending Market Number of Annual Gross Annual Benchmark Asset Weighted 3yr Annualized Std Annualized Std Year (Millions) Value (Millions) Portfolios Return Annual Net Return 1 Return StdDev* Dev** Dev**
Slide 34: Important information
Important information This document has been Issued in the UK by Impax Asset Management Group plc, whose shares are quoted on AIM. Impax Asset Management Group plc is registered in England & Wales, number 03262305. Impax Asset Management Group plc is the parent company of Impax Asset Management Limi
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