Pinnacle Investment Management Group Limited · ASX:PNI
Pinnacle Investment Management — FY2016 Earnings Presentation
25 slides from Pinnacle Investment Management's earnings presentation, Aug 30, 2016
Slide 1: Pinnacle Investment Management Group Limited – FY2016 financial highlights
Level 35 60 Margaret Street Sydney, NSW 2000 www.pinnacleinvestment.com.au 30 August 2016 By Electronic Lodgement The Manager Company Announcements Office ASX Ltd 20 Bridge Street SYDNEY NSW 2000 Dear Sir/Madam Pinnacle Investment Management Group Limited (ASX:PNI) – FY2016 financial highlights Gr
Slide 2: Composition of Group’s Results
Composition of Group’s Results The profit after tax from continuing operations for the 2016 financial year is $5.8 million, reflecting earnings per share of 5.2 cents versus 3.6 cents per share in the previous corresponding period. This result is before de-recognition of the DTA in the 2015 financia
Slide 3: Pinnacle Boutiques – FUM Growth
Pinnacle Boutiques – FUM Growth1 Pinnacle Boutiques – Revenue Growth2 Wilson Group – businesses other than Pinnacle 1 Pinnacle FUM includes 100% of FUM managed by the Pinnacle Boutiques. At 30 June 2016, the Company had a 75.01% interest in Pinnacle, which in turn has an interest in the Pinnacle Bou
Slide 4: Wilson Group
During the 2016 financial year, the Wilson Group segment comprised the Priority Funds, Next Financial and Principal Investments. The segment reported a net profit before tax of $0.6 million for the 2016 financial year, comprised of: Principal Investment gains of $0.7 million (2015 - $0.1 million)
Slide 5: Please do not hesitate to contact me
Please do not hesitate to contact me should you require any further information. Yours faithfully Eleanor Padman Company Secretary +61 2 8970 7726 5
Slide 6: Annual Results Discussion for the year ended 30 June 2016
Pinnacle Investment Management Group Limited Annual Results Discussion for the year ended 30 June 2016 30 August 2016 6
Slide 7: Agenda
Agenda Group Overview Group FY2016 Financials Year in Review ‐ Pinnacle ‐ Affiliated Boutiques ‐ Transition to 100% ownership Group Strategy and Priorities for FY2017 7
Slide 8: 2016 highlights
2016 highlights Simplification of corporate structure - 100% ownership of Pinnacle completed - Consolidated Board/ management teams - Further overhead efficiencies Pinnacle momentum - Strong performance of Boutiques with FUM and revenue growth - Antipodes and Spheria both off to strong start - I
Slide 9: Progress to Date – Platform and Reputation
Progress to Date – Platform and Reputation • A PLATFORM FOR GROWTH Reputation for investment excellence Known by all the key client groups and their key advisers • Close to an ‘article of faith’ reputation – all ‘best of breed’ • Reasonably diversified/robust • However, critical to maintain high
Slide 10: Pinnacle – 100% ownership
Pinnacle – 100% ownership Transaction update - Transaction closed on 25 August 2016 - Issue of ~37m shares to acquire the remaining 25% of Pinnacle - Ian Macoun announced as Managing Director on 17 August 2016 following Alexander Grant’s resignation - Deborah Beale, Gerard Bradley, Andrew Chambers
Slide 11: Australia’s leading investment “house of affiliated boutiques”
Australia’s leading investment “house of affiliated boutiques” Structure promotes independence, accountability, focus and longevity • Executives of both Pinnacle and affiliated boutiques have significant equity interests • Equity ownership enhances alignment with shareholders Seed FUM and working ca
Slide 12: Pinnacle Group Overview
Pinnacle Group Overview VR Pinnacle INVESTMENT MANAGEMENT LIYPERION 35.7% ; eistiesessmen tl PALISADE Pinnacle INVESTMENT MANAGEMENT Dantiroves SOLARIS mvesiment management RESOLUTION CAPITAL "46.64% from August 2017 12
Slide 13: Overview of Boutiques
Overview of Boutiques » Hyperion Asset Management (49% owned by Pinnacle) – a specialist manager of Australian equities following a growth style. » Palisade Investment Partners (35% owned by Pinnacle) – a specialist manager of unlisted infrastructure assets with both pooled funds and separately mana
Slide 14: Boutiques – FY16 performance
Boutiques – FY16 performance » Australian Growth Companies Fund – absolute performance of 15.6% after fees; Hyperion Small Growth Companies Fund – absolute performance of 16.9% after fees; Hyperion Global Growth Companies Fund – 10.6% gross return for the year. » Funds under management and investor
Slide 15: Boutiques – FY16 performance
Boutiques – FY16 performance » Funds under management grew to $4.6 billion up 17.9%. Long term out- performance remains pleasing. Business continues to make good progress on ambition to diversify its client base. » Pragmatic value manager of global and Asian equities, seeks to build high conviction
Slide 16: Financial summary
Financial summary (A$m) Year ending 30 Jun 2016 30 Jun 2015 Strong growth in Pinnacle earnings Pinnacle (100%) 10.6 7.4(1) Principal Investments 0.7 0.1 Increase in group overhead Priority Funds 0.5 (0.3) Next Financial (0.6) (0.7) includes one off costs Wilson Group 0.6 (0.9) Group Overhead (un
Slide 17: Pinnacle financial highlights
Pinnacle financial highlights (A$m) Year ending 30 Jun 2016 30 Jun 2015 Variance Strong FUM and revenue growth at FUM ($bn; end of year) 19.8 16.1 23.0% the boutiques Total Boutique revenues 92.8 72.0 28.9% Total Boutique Revenues of $92.8m, Pinnacle revenue 6.0 5.9 2.4% including $17.8m (or 19.
Slide 18: Balance sheet
Balance sheet A$m – 30 June 2016 Current assets Cash and Principal Investments of $24.5 Cash and equivalents 13.6 Excludes post balance date impacts Financial assets 10.9 including: Total cash and financial assets 24.5 Other current assets 8.3 special dividend of $5.5m (5 cents per Total curre
Slide 19: Consistent growth in FUM
Consistent growth in FUM Pinnacle funds under management ($bn) 25.0 21.5 19.8 20.0 16.1 15.0 12.3 10.9 10.3 10.0 10.0 8.0 5.0 4.4 3.5 1.7 0.0 Jun-07 Jun-08 Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 Jul-16 19
Slide 20: Consistent growth in affiliated boutique revenues
Consistent growth in affiliated boutique revenues Total Boutique revenues ($m) 100.0 92.8** 90.0 80.0 72.0* 70.0 60.0 55.7 47.1 50.0 37.9 38.6 40.0 28.0 30.0 20.0 16.0 14.4 10.0 8.2 0.0 Jun-07 Jun-08 Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 *2015 -includes performance fees of $11.1m -
Slide 21: Boutique investment performance (31 July 2016)
Boutique investment performance (31 July 2016) 1Y 3Y Inception Inception date Pinnacle Investment Management Hyperion Asset Management - Gross Performance Hyperion Australian Growth Companies Fund 19.35% 16.52% 13.57% 1/10/2002 Returns in exess of benchmark 16.50% 8.46% 4.34% Hyperion Small Growth C
Slide 22: Broad Strategy Principles
Broad Strategy Principles Keep existing Protect the businesses Core strong and growing Be open to Recognise possibilities without feeling the 3 pressure to Growth undertake Horizons Horizon 2 and 3 initiatives Convey Deliver on consistent and reasonable reasonable growth growth expectations, and exp
Slide 23: Growth Horizons Framework
Growth Horizons Framework Horizon 3 • Must not place the company at risk Horizon 2 • Only consider if low risk and high return • New boutiques on invested capital and ‘non-capital’ Horizon 1 parent growth • Exercise great care initiatives (direct- and careful due • Sustain organic to-retail, offshor
Slide 24: Priorities for FY17
Priorities for FY17 » Continue to provide high quality distribution, Responsible Entity and infrastructure services » Support the affiliated fund managers in their maintenance of high standards » Remain focused on investing to enable continued strong performance and FUM growth » Continue to grow ret
Slide 25: Disclaimer
Disclaimer • This presentation has been prepared by Pinnacle Investment Management Group Limited (PNI). The information in this presentation is current as at 30 August 2016. • This presentation is not an offer or invitation for subscription or purchase of securities or a recommendation with respect
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