BKI Investment Co. Ltd. · ASX:BKI
BKI Investment — FY2015 Earnings Presentation
24 slides from BKI Investment's earnings presentation, Jul 22, 2015
Slide 1: FY2015 Full Year Results Presentation
For personal use only BKI Investment Company Limited FY2015 FULL YEAR RESULTS PRESENTATION 1
Slide 2: Disclaimer
Disclaimer For personal use only This material has been prepared by BKI Investment Company Limited. The information within this document is not intended to provide advice to investors or take into account an individual’s financial circumstances or investment objectives. This is general investment ad
Slide 3: FY2015 Result Highlights
For personal use only BKI Investment Company Limited FY2015 RESULT HIGHLIGHTS 3
Slide 4: Delivering Strong Results
Delivering Strong Results For personal use only 2015 2014 Growth Ordinary Dividend Income $44.6m $38.6m 16% Net Operating Result* $40.9m $35.9m 14% Earnings Per Share* 7.40cps 7.15cps 4% Total Ordinary Dividends Per Share 7.20cps 6.95cps 4% Management Expense Ratio (MER) 0.18% 0.17% * Excluding Spec
Slide 5: BKI Overview
For personal use only BKI Investment Company Limited BKI OVERVIEW 5
Slide 6: Business Overview
Business Overview For personal use only BKI is a research driven, active equities manager investing for the long term in profitable, high yielding, well managed companies. BKI is a closed end company listed on the ASX (BKI.ASX) and does not charge external portfolio management or performance fee
Slide 7: Key Differentiators
Key Differentiators For personal use only High Value / Low Cost - Active, high conviction, closed end portfolio, with no Debt. MER of 0.18%. No external portfolio management or performance fees. Performance - Delivering sound returns plus dividend growth. Alignment - Directors and Management a
Slide 8: Key Differentiators
Key Differentiators For personal use only Diversification – Exposure to well managed, dividend paying companies. Listed on the ASX • ASX Listing Rules - Continuous Disclosure requirements, High levels of Transparency and Compliance. • Size & strength - Market Capitalisation of $977m*. • Simplici
Slide 9: Low Cost, Income and Capital Growth
For personal use only BKI Investment Company Limited LOW COST, INCOME AND CAPITAL GROWTH 9
Slide 10: Low Cost, Growing Dividend
Low Cost, Growing Dividend BKI’s Board & Management are shareholders in BKI. For personal use only We invest for the long term and do not charge external portfolio management or performance fees. We focus on creating wealth for all shareholders by keeping costs low and increasing fully franked divid
Slide 11: Low Cost
Low Cost Based on $100,000 investment in a Listed Investment Company, For personal use only using a 10% return pa over a 20 year period. Over 20 years, administration $700,000 $21,678 0.18%pa MER fees of 2.0% can $600,000 $112,309 1.0%pa MER $206,654 2.0%pa MER dilute the total $500,000 return on an
Slide 12: Income Growth
Income Growth For personal use only Dividends + Franking Credits received from a $100,000 investment in BKI at inception versus Bank Quarterly Interest. Highlights the opportunity of receiving a fully franked dividend in a falling interest rate environment. BKI Dividend BKI Franking Interest 16,000
Slide 13: Total Shareholder Capital Growth
Total Shareholder Capital Growth For personal use only Total Shareholder Returns including franking credits Returns including the benefit of franking 25.0% credits passed on from 20.5% BKI to shareholders. 20.0% 16.5% 15.7% 15.0% 12.3% 11.4% 11.8% BKI has ample franking 10.0% 8.8% 7.3% 7.1% 7.0% cre
Slide 14: Long Term Investment Portfolio
For personal use only BKI Investment Company Limited LONG TERM INVESTMENT PORTFOLIO 14
Slide 15: A Focus on the Future
A Focus on the Future For personal use only Over the last 15 years Australian exports have Exports Relative to GDP Growth, 2000 – 2015 been dominated by the Resources sector, in particular Iron Ore and Coal. Resources are now in Production Phase; a game for the big players, where scale and low c
Slide 16: A Focus on the Future
A Focus on the Future For personal use only Long term investors constantly remain focused on future opportunities. The following sectors have an attractive long term thematic and the BKI portfolio is well positioned to capture future growth expected within these sectors. Cash Finance - Attractiv
Slide 17: Portfolio Movements
Portfolio Movements For personal use only Main Purchases Main Sales National Australia Bank Toll Holdings Low Portfolio Turnover APA Group ALS Limited 70% Sydney Airport DUET Group 60% Transurban Group APA Renounceable Rights 50% QUBE Holdings GWA Group 40% Santos Limited South32 Limited 30% Wesfarm
Slide 18: BKI Portfolio – Top Shareholdings as at June 2015
BKI Portfolio – Top 25 Shareholdings as at 30 June 2015 For personal use only Stock % of Total Stock % of Total Portfolio Portfolio 1 Commonwealth Bank 9.3% 14 IAG Limited 1.9% 2 National Australia Bank 9.2% 15 Invocare Limited 1.9% 3 Westpac Bank 7.3% 16 Suncorp Group Limited 1.7% 4 Telstra Corpora
Slide 19: BKI Portfolio – Exposure by Sector
BKI Portfolio – Exposure by Sector High Conviction For personal use only Banks; 33% Benchmark Unaware Telecommunication Services; 10% Information Technology; 0% BKI’s long term Real Estate; 0% strategy of investing in Financials; 10% dividend paying stocks Consumer Discretionary; 3% means the portfo
Slide 20: Yield for Today, Growth for Tomorrow
Yield for Today Telstra FY16 Estimates TPG Telecom FY16 Estimates Growth for Tomorrow Income For personal use only Dividend Yield 5.2% 1.5% Franking 100% 100% Grossed up Yield 7.5% 2.2% DPS Growth 5% 20% BKI’s stock selection is bottom up, focusing on the Pay Out Ratio 87% 39% merits of individual c
Slide 21: Appendix
For personal use only BKI Investment Company Limited APPENDIX 21
Slide 22: Experience and Alignment
Experience and Alignment For personal use only Equity Investment Tenure Team Member Qualifications Position Ownership Experience With BKI 1 Robert Millner FAICD Chairman 32 yrs 11 yrs 8,484,091 Investment Committee David Hall, AM FCA, FAICD Non Executive Director Chairman Audit 36 yrs 11 yrs 277,970
Slide 23: BKI Fact Sheet
BKI Fact Sheet For personal use only ASX Code BKI.ASX Research Coverage Morningstar Listing Date December 2003 Morgan Stanley Mandate Aust Listed Equities Bell Potter Investment Sectors Diversified Evans and Partners S&P/ASX 300 BaillieuHolst Benchmark Acc Index Approved Product List Dixon Advisory
Slide 24: www.bkilimited.com.au
www.bkilimited.com.au For personal use only Our aim is to BKI Online create wealth Sign up online to receive news and information about your company via for BKI email. shareholders, Subscribe to: • NTA+Monthly Reports • Quarterly Reports through an • Presentations to Shareholders • Annual Report inc
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