Regal Investment Fund · ASX:RF1
Regal Investment Fund — Investor Presentation (March 2021)
29 slides from Regal Investment Fund's investor presentation, Mar 25, 2021
Slide 1: March 25, 2021 webinar presentation
March 25, 2021 This presentation deck accompanies an audio recording at 11am AEDT on March 25, 2021. To view the full webcast please click on the link here and register for the webinar. To access the replay of this recording, please reach out to investorrelations@regalfm.com. For any questions on RF
Slide 2: Regal Investment Fund (ASX.RF1)
Equity Trustees Limited ACN 004 031 298 AFSL 240975 Regal Investment Fund (ASX.RF1) ARSN 632 283 384 March 2021
Slide 3: Disclaimer
Disclaimer Equity Trustees Limited (Equity Trustees) (ABN 46 004 031 298), AFSL 240975, is the Responsible Entity for the Regal Investment Fund (ARSN 632 283 384) (ASX: RF1). Equity Trustees is a subsidiary of EQT Holdings Limited (ABN 22 607 797 615), a publicly listed company on the Australian Sec
Slide 4: Agenda
RF1 Review Market Update RF1 Outlook Q&A Agenda 1 Regal Investment Fund (RF1) — Review 4 2 Market Update 5 2a Mining Sector Update 11 2b Shorting 19 3 Regal Investment Fund (RF1) — Outlook 20 4 Investor Q&A 26 2
Slide 5: Regal Funds Management
RF1 Review Market Update RF1 Outlook Q&A Regal Funds Management Regal has a heritage built on long / short investing, pioneering the development of the hedge fund & alternatives industry in Australia since 2004 PERFORMANCE SCALE ALIGNMENT FOCUS ― Multi-award winning ― Managing over ― 100% privately
Slide 6: RF1 Investment Performance
RF1 Review Market Update RF1 Outlook Q&A RF1 Investment Performance Performance since listing – Net Asset Value Since Fund performance 20193 2020 20214 Inception5 200 Regal Investment Fund1 +11% +46% +11% +82% 180 Regal Investment Fund (RF1) + 82% S&P/ASX 300 Total +5% +2% +2% +9% Return Index 160 S
Slide 7: Closing In On All Time Highs
RF1 Review Market Update RF1 Outlook Q&A Closing In On All Time Highs ASX All Ordinaries Index since 1990 8,000 7,000 6,000 5,000 4,000 3,000 2,000 1,000 -- 1990 1992 1995 1998 2001 2004 2007 2009 2012 2015 2018 2021 Source: Bloomberg as at 22 March 2021 5
Slide 8: Market Not Overextended
RF1 Review Market Update RF1 Outlook Q&A Market Not Overextended Rolling 5-year annualised equity returns 32% Rolling 5-year annualised equity returns Average 24% Beginning of a 25% market drawdown 16% 8% -- (8%) (16%) (24%) (32%) Annual equity returns 70% 35% -- (35%) (70%) 1917 1928 1940 1951 1963
Slide 9: Best Reporting Season In Recent History
RF1 Review Market Update RF1 Outlook Q&A Best Reporting Season In Recent History S&P/ASX 200 Index EPS1 revision during reporting season ….DPS1 revision during reporting season 5.0% 10.0% 4.0% 8.0% 3.0% 6.0% 2.0% 4.0% 1.0% 2.0% --% --% (1.0%) (2.0%) (2.0%) (4.0%) (3.0%) (6.0%) Source: Broker Researc
Slide 10: A 40 Year Bull Market In Bonds
RF1 Review Market Update RF1 Outlook Q&A A 40 Year Bull Market In Bonds Australian 10-year Government Bond yield since 1900 18% 16% 14% 12% 10% 8% 6% 4% 2% --% 1900 1909 1918 1928 1937 1946 1956 1965 1974 1984 1993 2002 2012 2021 Source: Broker research, Bloomberg as at 26 February 2021 8
Slide 11: Equities Still Attractive v Bonds
RF1 Review Market Update RF1 Outlook Q&A Equities Still Attractive v Bonds Equity yield v real bond yield 11% E/Y vs B/Y 30-yr avg 10-yr avg 9% 7% 5% 3% 1% (1%) 1994 1995 1997 1998 2000 2001 2003 2004 2006 2007 2009 2010 2012 2013 2015 2016 2018 2019 2021 Source: Broker research as at 22 March 2021
Slide 12: Growth v Value — The Tables Are Turning
RF1 Review Market Update RF1 Outlook Q&A Growth v Value — The Tables Are Turning Growth v Value since 1992 10 year rolling return of Growth – Value 1600 100% Value Growth 80% 1400 60% 1200 40% 1000 20% 800 --% (20%) 600 (40%) 400 (60%) March 2021 200 (80%) Value +16% v Growth 0 (100%) 1992 1996 2000
Slide 13: Mining Super Cycle Just Beginning
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Mining Super Cycle Just Beginning Australian Mining ‘Bull Markets’ since 1918 Performance of the ASX Resources sector, Index 100 = beginning of ‘Bull Market’ Sep-1921 to Mar-1929 Mar-1942 to Jun-1948 Jun-1949 to Jun-1961 800 Sep-1965 to Dec-1969
Slide 14: Demand & Supply Supports Strong Commodity Prices
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Demand & Supply Supports Strong Commodity Prices Global iron ore industry development capital (U$bn) Global GDP growth forecast to accelerate $45 +6.3% pa +6.0% pa $40 +5.7% pa +35.5% $35 +34.0% +31.7% +4.4% pa $30 $25 5 year average: $27.3bn +2
Slide 15: Copper Market — Large Supply Deficit Looms
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Copper Market — Large Supply Deficit Looms Copper production capacity and the future supply gap (Mt Cu) 28 Brownfield / Extensions Mega trends — Bullish Copper Available From Base Case Mines 26 Demand (Refined Metal) • Decarbonization 24 ~6.0 Mt
Slide 16: Oz Minerals (ASX: OZL) — Liquid Copper Exposure
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Oz Minerals (ASX: OZL) — Liquid Copper Exposure Oz Minerals’ enviable growth pipeline, creating optionality and expanding operations Exploration Studies Development Operations Prominent Underground Prominent Hill Mt Woods Expansion UG + stockpil
Slide 17: Oz Minerals (ASX: OZL) — Carrapateena Expansion
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Oz Minerals (ASX: OZL) — Carrapateena Expansion Transition from ‘sub–level cave’ to ‘block cave’ will lift production and extend mine life Source: Oz Minerals ASX release, 23 June 2020 CAUTION: Regal and RF1 hold a position in Oz Minerals (OZL)
Slide 18: Chalice (ASX: CHN) — Major Discovery
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Chalice (ASX: CHN) — Major Discovery Globally significant PGM-nickel-copper discovery in Western Australia Julimar Gonneville Intrusion Source: Chalice, ASX release, 1 March 2021 CAUTION: Regal and RF1 hold a position in Oz Minerals (OZL) and Ch
Slide 19: Chalice (ASX: CHN) — Extensive, High Grade
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Chalice (ASX: CHN) — Extensive, High Grade Eleven high-grade zones with significant strike length, all open Source: Chalice, ASX release, 1 March 2021 CAUTION: Regal and RF1 hold a position in Oz Minerals (OZL) and Chalice Mining (CHN). Regal is
Slide 20: Chalice (ASX: CHN) — Victorian Gold
RF1 Review Market Update Mining Sector RF1 Outlook Q&A Chalice (ASX: CHN) — Victorian Gold Along strike from tier–1 gold mines Prolific Victorian goldfields Extensive holdings of prospective ground Source: Chalice, ASX release, 1 March 2021 CAUTION: Regal and RF1 hold a position in Oz Minerals (OZL)
Slide 21: Shorting Has Been Tough
RF1 Review Market Update Shorting RF1 Outlook Q&A Shorting Has Been Tough Underperformance of the Top–20 most shorted stocks in the S&P/ASX 200 Index 25% Rolling 3 months Short Alpha (LHS) Rolling 12 months Short Alpha (RHS) 50% Short Alpha: underperformance of the Top 20 most shorted stocks 20% 40%
Slide 22: RF1 Investment Performance
RF1 Review Market Update RF1 Outlook Q&A RF1 Investment Performance Fund performance 20193 2020 20214 Since Inception5 Regal Investment Fund1 +11% +46% +11% +82% S&P/ASX 300 Total Return Index +5% +2% +2% +9% Strategy performance within RF12 20193 2020 20214 Since Inception5 Market Neutral +6% +22%
Slide 23: Corporate Actions Providing Opportunities In Asia
RF1 Review Market Update RF1 Outlook Q&A Corporate Actions Providing Opportunities In Asia Equity issuance in Asia — US$bn 600 IPO Placement & Rights Secondary Issuance 500 400 300 200 100 -- 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Note: All equity issuance in Asia greater than US$50m
Slide 24: Opportunities In Emerging Companies
RF1 Review Market Update RF1 Outlook Q&A Opportunities In Emerging Companies Successful pre IPO investments in RF1 Select pre IPO investments in RF1 coming to market Source: Regal as at 22 March 2021 Note: This is a selection of pre IPO investments made by the Regal Emerging Companies Fund III. This
Slide 25: Delivering Unitholder Value
RF1 Review Market Update RF1 Outlook Q&A Delivering Unitholder Value RF1 share price – adjusted for distributions $4.8 Premium/(Discount) to NAV (RHS) 40% $4.162 Investment Top quartile RF1 Share Price (adjusted for distributions) $4.2 +85% Performance returns4 $3.6 20% Investor Significant staff $3
Slide 26: Buyback Has Provided Accretion and Liquidity
RF1 Review Market Update RF1 Outlook Q&A Buyback Has Provided Accretion and Liquidity The RF1 buyback has been 22% of the traded volume since initiation, at an average price of $2.71 A$/share 000’ shares Weekly share buyback (000'' shares) Regal Investment Fund (RF1) A$/share $4.50 1,000 900 $4.00 8
Slide 27: Historical Yield 5.5%
RF1 Review Market Update RF1 Outlook Q&A Historical Yield 5.5% Regal Investment Fund – net asset value RF1 NAV ($/share, inc. distributions) S&P/ASX 300 Total Return Index $4.5 $4.102 4.5c distribution 18.6c distribution 5.0c distribution +82% $4.0 $3.5 $3.0 $2.443 $2.5 +9% $2.251 $2.0 $1.5 Source:
Slide 28: Investor Q&A
RF1 Review Market Update RF1 Outlook Q&A Investor Q&A Phil King Tim Elliott Brendan O’Connor Chief Investment Portfolio Manager Chief Executive Officer Head of Mining Officer 26
Slide 29: Regal Investment Fund (ASX: RF1)
Thank you for joining the Investor Update for the, Regal Investment Fund (ASX: RF1) If you have any questions following this presentation, please contact our Registry on: regalfund@linkmarketservices.com.au Alternatively, please visit the manager’s website: www.regalfm.com Thank you again for your c
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