Slide 1: Investor introduction Spring 2023
Quilter Basic rBand Guidelines Our brand a ssets 1 Investor introduction Spring 2023
Slide 2: Disclaimer
Disclaimer This presentation may contain certain forward-looking statements with respect to certain Quilter plc’s plans and its current goals and expectations relating to its future financial condition, performance and results. By their nature, all forward-looking statements involve risk and uncerta
Slide 3: Industry overview and Quilter's journey to date
Industry overview and Quilter’s journey to date
Slide 4: UK Wealth: a secular growth opportunity
UK Wealth: a secular growth opportunity UK wealth management market growth and forecast¹ AuA, £tn c.2.2-2.5 CAGR +6 to 10% The UK wealth management market is the c.1.8 fifth largest in the world4 Strong market growth as flows consolidate CAGR 0.7 Retail Advised² onto Platforms +13% Our Retail
Slide 5: Industry context – secular growth with cyclical challenges
Industry context – secular growth with cyclical challenges UK Wealth market has strong secular growth potential Cyclical equity and bond market headwinds in 2022 Economic downturn, higher interest rates, cost-of-living challenges impacting flows Adviser consolidation causing market disruption 5
Slide 6: Industry dynamics: Retirement demographics continuing advice demand
Industry dynamics: Retirement demographics continuing advice demand UK England & Wales Population¹ (‘000 by age year, 2018) Turned 60 in 2019 1,000 – potentially requiring retirement advice 925 900 Baby boomers born in 1947 800 787 700 600 700k+ people turned 65 and 925k+ turned 50 in 2019 – potenti
Slide 7: Industry dynamics: regulatory and fiscal changes driving disruption
Industry dynamics: regulatory and fiscal changes driving disruption Provides customers with opportunity for consolidation and flexibility to manage retirement assets Pension reform Demand and complexity driving need for advice Increased longevity of client relationships for wealth managers ver
Slide 8: Industry dynamics: fiscal changes driving complexity and need for advice
Industry dynamics: fiscal changes driving complexity, changing client behaviour and need for advice Annual pension allowance £’000 Allowance tapered for over CAGR 255 £150k earners 235 245 -13% 50 50 50 40 40 40 40 40 40 40 40 2008/9 2009/10 2010/11 2011/12 2012/13 2013/14 2014/15 2015/16 2016/17 20
Slide 9: Industry dynamics: continued strong demand for Advice
Industry dynamics: continued strong demand for Advice as cost of delivery increases Adviser trend to serve fewer active clients continues: Market total revenue from adviser charges¹ Revenues on investment advice and related charges Compensation model from commission to fees £5.6bn £5.5bn £6.2bn
Slide 10: Industry dynamics: Business models adapted to changing regulation
Industry dynamics: Business models adapted to changing regulation and evolving value chain Typical older / Pre-RDR Insurance Modern Wealth Manager models Customers • Product driven sales, ‘pushed’ • Customer driven solutions through incentive driven distribution channels • Commission models driving
Slide 11: Quilter: our story and achievements since Listing in 2018
Quilter: our story and achievements since Listing in 2018 2018 2019 2020 2021 2022 Design, build and migration onto new Platform Successful re-platforming Sold Quilter Sold Single Strategy International Sold Quilter Life Business simplification Asset management Assurance business Resegmentation – Af
Slide 12: Business reshaped towards a UK centric focus since Listing
Business reshaped towards a UK centric focus since Listing Refocused on High Net Worth and Affluent segments Market leading platform built on robust technology Two scale distribution channels Capital discipline Significant cost reduction programmes c.£1bn returned to shareholders since Listing 12
Slide 13: Quilter: a differentiated model with clear benefits
Quilter: a differentiated model with clear benefits to clients and shareholders Model Benefits Customer High Net Worth segment Quality assured choice Affluent Advice Quilter Breadth and strategic control of distribution IFA channel² channel¹ Platform Platform Scale and operating leverage Investment
Slide 14: FY 2022 results overview - robust delivery in challenging markets
FY 2022 results overview - robust delivery in challenging markets Quilter highlights FY 2022: Steady Business Adjusted diluted Increased total Robust profit operating transformation earnings per share dividend2 margin in progress1 £134m 22% £65m – Optimisation 7.9p 4.5p (3%) y-o-y no change £23m – S
Slide 15: Quilter FY 2022 AuMA £100bn
Quilter FY 2022 AuMA Advice Platform Investment Note: Assets rounded to Administered Managed Gross Net flows / Net flows3 opening the nearest flows3 AuMA % billion Quilter Cheviot QuilterCheviot Quilter Cheviot High Net £25bn 3% Worth £26bn £26bn £26bn HNW £2.3bn £0.9bn 3% IFA originated AuMA £100bn
Slide 16: Quilter: strategically well positioned across the UK wealth industry
Quilter: strategically well positioned across the UK wealth industry Three broadly equal revenue streams from our three core franchises High Net Worth c.£200m Affluent c.£400m Strategic focus: Strategic focus: Improving productivity High Net Worth Integrated Advice Greater RFP alignment Discreti
Slide 17: Focus areas to drive business improvement
Focus areas to drive business improvement Building Distribution Grow relationships with larger IFA firms Increase alignment/retention in Quilter Financial Planning Add Investment Managers and Advisers in High Net Worth/QPCA Enhancing Proposition Driving Efficiency Refresh our investment solutions to
Slide 18: Group flow expectations – driving incremental improvement
Group flow expectations – driving incremental improvement Advice Platform Net flow / Opening AuMA % Targets AuMA 2022 Weighted contribution to Expectation Group net flow (%) High Net Quilter Cheviot Worth £25bn HNW 4-5% c.1-11⁄2 % £26bn 2%+ in 2023, building to £50bn 1-2% in 2023, building to c.1% i
Slide 19: Delivering the next stage of efficiency improvements
Delivering the next stage of efficiency improvements Optimisation (2019 launch): Benefit – £65m¹ Simplification (2021 launch): Benefit – £45m £45m cost saves £15m cost saves £50m cost saves 2019 2020 2021 2022 2023 2024 Phase: 1. Operational efficiencies Phase: 2. Enhancing efficiency • Operational
Slide 20: Investing for the generations of today and tomorrow
Investing for the generations of today and tomorrow Enhancing and modernising our digital service experience to engage clients of today and tomorrow Digital accessibility and solutions Quilter website transformation Aligning our website experience with our segment strategy Affluent Quilter Customer
Slide 21: Building a responsible wealth manager
Building a responsible wealth manager Targets Every client ESG profiled as part of advice process ESG preferences embedded in advice process ESG and carbon-rating tools Our offering to clients Platform provides visibility across ESG metrics available on Platform Solutions aligned to ESG va
Slide 22: Business Segments
Business Segments Quilter
Slide 23: Simpler business, organised around two core client segments
Simpler business, organised around two core client segments Two client reporting segments High Net Worth Benefits and synergies from the new segmentation Affluent From £250k investable Client-centric approach £50-£500k investble assets assets Improved customer experience Simpler operating mode
Slide 24: Our solutions strategy to meet client needs
Our solutions strategy to meet client needs Advice Platform Investment Fee to client Higher Potential 1. Premium product growth Discretionary portfolio Cirilium Active service 2. Price/value trade-off WealthSelect Managed 3. Value-based Cirilium Blend portfolio solutions service WealthSelect Income
Slide 25: High Net Worth
High Net Worth Quilter
Slide 26: High Net Worth – bringing the proposition together
High Net Worth – bringing the proposition together: aligning expertise, resources and services Discretionary Fund Management Quilter High Net Worth segment Advice Managing the financial needs of clients through a tailored approach Seamless combination offering investment management, Better clien
Slide 27: High Net Worth - Integrating in-house advice capability to drive growth
High Net Worth- Integrating in-house advice capability to drive growth Focus areas since transition The High Net Worth Proposition A strong established multi-channel business Engagement and cultural alignment of advisers and investment managers, supported by joint Responsible for Quilter’s own
Slide 28: Embedding ESG throughout our processes
Embedding ESG throughout our processes Active ownership agenda Tailored ESG screening for discretionary portfolios ESG 2020 Stewardship Code Stewardship signatory Solutions Positive Change Strategy Engagement record Climate Assets Fund ESG Integration & Screening Focus on core investme
Slide 29: High Net Worth: investing for growth
High Net Worth: investing for growth Investment Revenues £m - 212 212 FY 2022 highlights Expenses £m Quilter Private Client Advisers 23 (9)% 21 Stable revenue within High Net Worth +7% 167 156 Investment Manager headcount increased by 9 year-on-year Adj. profit £m Operating 1% 26% 21% margin Qui
Slide 30: High Net Worth flows – resilient and stable
High Net Worth flows – resilient and stable Quilter channel Quilter channel Gross Net flows flows 2.6 2.7 IFA incl. Direct channel £bn 1.1 IFA incl. Direct channel £bn 2.3 0.9 0.5 0.5 0.4 2.1 0.4 0.5 0.3 0.5 0.7 0.4 0.4 0.5 (0.1) 2.1 2.2 1.6 1.8 (1.2) 2019 20201 2021 20222 (0.8) 2019 20203 2021 2022
Slide 31: Affluent
Affluent Quilter
Slide 32: Affluent: bringing the proposition together
Affluent: bringing the proposition together: a customer-centric, integrated approach Advice Helping Helping advisers Platform Services customers feel Quilter to run a more more secure Affluent Segment successful about their future advice business Investment Solutions Simple and clear All solutio
Slide 33: Quilter Platform - a best in class proposition for advisers
Quilter Platform - a best in class proposition for advisers Tools and solutions to help adviser firms grow Cost effective and scalable Delivering a differentiated intuitive user experience and ease of use proposition for adviser firms Support advisers to deliver Exceptional client service 33
Slide 34: An integrated approach to adviser relationships
An integrated approach to adviser relationships Differentiated ability to support advisers across the market unique to Quilter Quilter advice firm Potential eventual exit via practice buyout Adoption of Quilter brand and marketing Regulatory compliance outsourced to Quilter Strategic partner Adviser
Slide 35: IFA channel growth strategy: broaden, deepen, retain
IFA channel growth strategy: broaden, deepen, retain Accessible market opportunity by targeted adviser firm “Retain”: Core supporters Firms’ market flows Smaller IFAs where Quilter is principal Platform £bn, annually Service well in a cost efficient manner 15 “Deepen”: Large, existing supporters
Slide 36: Affluent: resilient performance in challenging markets
Affluent: resilient performance in challenging markets Investment Revenues £m (5)% FY 2022 highlights 406 387 Expenses £m Solid financial performance supported Advice fees 90 (14)% by strong cost management 77 (4)% 295 282 Changed management of Cirilium Active Administration fees 127 (5)% 121 Ad
Slide 37: Retail Market gross flows
Retail Market gross flows Total retail advised market gross platform flow £bn Quilter market 3 3 2 1 share position Gross flow market share rank moved from 3rd to 1st New platform following introduction of new (19%) introduced platform 82.3 66.8 59.1 59.3 2019 2020 2021 2022 37 Total retail market
Slide 38: Quilter channel Platform flows – continued strong performance
Quilter channel Platform flows – continued strong performance Gross flows £bn Net flows £bn2 Quilter channel 2.6% 3.0% 3.2% 3.8% flows market New platform share %1 introduced 2.6 2.6 % of Net 20% 16% 19% 15% flows/opening AuMA 1.8 1.8 1.8 1.6 1.1 1.2 2019 2020 2021 2022 2019 2020 2021 2022 Breakdown
Slide 39: IFA Platform flows – key focus for driving flows
IFA Platform flows – key focus for driving flows Gross flows 7.6% 6.6% 7.7% 7.4% IFA flows market Net flows £bn2 share %1 £bn1 6.3 New platform % of Net introduced - 1% 3% 1% flows/opening 4.9 AuMA 4.5 3.9 1.7 0.4 0.4 2019 2020 2021 2022 (0.2) Breakdown 2019 2020 2021 2022 Net flows £0.4bn £bn 4.9 (
Slide 40: Focus on driving Quilter channel growth and adviser productivity
Focus on driving Quilter channel growth and adviser productivity Gross sales Quilter channel £m Adviser productivity - gross 1.8 2.3 2.3 sales per Quilter adviser £m Adviser productivity - gross 1.2 1.8 1.9 sales (onto Quilter Platforms including HNW) per Quilter adviser £m 4,018 3,661 Quilter chann
Slide 41: ESG: progress towards vision of embedding across the customer journey
ESG: progress towards vision of embedding across the customer journey Interactive adviser/client tools Platform includes ESG ratings Integration into advice process Advice Platform Portfolio carbon-rating tools ESG advice training Investment WealthSelect+ to include ESG filters ESG cor
Slide 42: Performance
Performance Quilter
Slide 43: FY 2022 results: summary
FY 2022 results: summary Improved persistency of 92% Key financials FY 2022 FY 2021 ∆ (FY21: 91%) Continuing operations Revenue margins in line with Net flows / Opening AuMA % 2 4 (2)ppt guidance Adjusted profit before tax £m 134 138 (3)% Cost discipline IFRS profit after tax £m 175 23 n/a R
Slide 44: Revenue margin progression broadly in line with guidance
Revenue margin progression broadly in line with guidance Revenue margin bps Quilter Cheviot Affluent Administered Affluent Managed Quilter plc 80 70 60 50 40 30 20 Jun-19 Sep-19 Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Dec-22 Revenue margins in line with
Slide 45: Expense discipline contributing to lower cost outcome
Expense discipline contributing to lower cost outcome As a Cost analysis percentage of (£m) revenues FY FY FY FY 2022 2021 2022 2021 FY 2022 expense progression Support staff costs 118 127 £m Operations 22 27 6 4 5 8 Technology 35 42 26 8 Property 31 31 16 Other base costs¹ 30 25 3 Sub-total base co
Slide 46: Cash and capital
Cash and capital Quilter
Slide 47: Strong solvency ratio and cash position
Strong solvency ratio and cash position Solvency II ratio 275% (56)% 230% 12% (10)% (5)% 14% Strong Pro forma Solvency II ratio January - issue of £200 million of 8⅝% Fixed Rate Reset Subordinated Notes due April 2033, with a call option from January 2028 T2 bond: 32% Solvency at Capital return
Slide 48: FY 2022 dividend and capital returns
FY 2022 dividend and capital returns Dividend Return of Quilter International proceeds Recommended FY 2022 dividend of 4.5p, up 13% on a continuing £328m capital return via ‘B’ share mechanism and share basis consolidation Improved dividend pay-out ratio of 57% versus 2021 6 for 7 share cons
Slide 49: Stable operating margin and EPS progression
Stable operating margin and EPS progression Stable operating margin with positive forward trends Stable operating margin of 22%, in line with the prior year 30% Revised target of 25% in 2025, with 30% still our aspiration 25% 22% 22% 19% 2020 2021 2022 2023 2024 2025 Long term goal Adjusted dilu
Slide 50: Capital management philosophy
Capital management philosophy Current year dividend On-going cash needs Group capital requirements Working capital & interest Investing Investing in the growth of the business organically Optimisation programme Capital allocation To accelerate growth through bolt-on acquisitions Investin
Slide 51: Investment case
Investment case Quilter
Slide 52: Cohesive and balanced business model meeting all stakeholder needs
Cohesive and balanced business model meeting all stakeholder needs Revenue In-segment synergies Stakeholder outputs Affluent: c.£400m Quilter channel Full-spectrum of adviser support Advisers: technical and cultural experience in advice management Scale benefits from shared Platform Single i
Slide 53: Quilter Group targets and 2023 guidance
Quilter Group targets and 2023 guidance Group target Net flows c.4-5% of opening AuMA per annum as markets normalise, and aspire to build momentum further High Net Worth managed assets (Quilter Cheviot) stable around 70 bps Revenue Affluent managed asset mix dependent – trending down to low 40
Slide 54: Appendix
Appendix Quilter
Slide 55: Q1 2023 trading update
Q1 2023 trading update % of Net inflows 4% 2% 1% Assets under Management and Administration 4% opening £m AuMA1 (“AuMA”) of £101.9 billion at the end of March 2023, an increase of 2% from 31 December 2022. Average 92% 92% 90% 105.3 107.6 102.8 101.8 AuMA 92% 92% Persistency2 Average AuMA for the
Slide 56: Key historic financials: Quilter plc continuing business
Key historic financials: Quilter plc continuing business Total continuing business FY19 FY20 FY21 Total revenues (£m) FY19 FY20 FY21 Net management fees (£m) 469 446 500 Affluent segment 388 370 406 Other revenues (£m) 118 118 118 High Net Worth segment 196 193 212 Total revenues (£m) 587 564 618 He
Slide 57: Affluent Managed performance
Affluent Managed performance Investment performance from largest product in a challenging market Strong performance across all strategies in 2022, with exception of Cirilium Active. Cirilium fund range now £26bn under single team £25bn £23bn Cirilium Active (£7bn) £22bn 10-year track record re
Slide 58: Full Year 2022: Movement in assets and flows
Full Year 2022 : Movement in assets and flows Of which managed by AuMA* AuMA* Quilter as at 31 as at 31 AuM as at 2022 YTD gross flows, net flows & AuMA (£bn), December Gross Net December 31 December unaudited 2021 flows* (£m) Flows* (£m) 2022 2022 AFFLUENT SEGMENT Quilter channel 11.7 2,554 1,823 1
Slide 59: Quilter Investors: investment performance
Quilter Investors: investment performance As at 31 December 2022 Investment performance Fund vs IA Sector comparator 1Y 3Y 5Y 10Y Since inception1 Cirilium Conservative Portfolio 3 3 3 1 1 Cirilium Conservative Blend Portfolio 1 1 1 Strong performance in 2022. All Conservative WealthSelect Managed
Slide 60: High Net Worth: investment performance
High Net Worth: investment performance Investment performance in a challenging market Investment performance Quilter Cheviot performance vs. ARC Sterling PCI Index, at 30 September 2022 Relative % vs ARC PCI Balanced Steady Growth Equity Risk 2022 was a challenging year for investment performance 3