Impax Asset Management Group Plc · LSE:IPX
Impax Asset Management — Shareholder Meeting (March 2025)
66 slides from Impax Asset Management's shareholder meeting presentation, Mar 5, 2025
Slide 1: Annual General Meeting
Annual General Meeting 5 March 2025 FOR INFORMATION ONLY. THIS IS NOT A MARKETING COMMUNICATION. NOT FOR FURTHER DISTRIBUTION.
Slide 2: Agenda
Agenda 1. FY24: highlights 2. Our strategy 3. Trading update 4. Outlook 2
Slide 3: FY24: highlights
FY24: highlights 3
Slide 4: Investing in the transition to a more sustainable economy for 25+ years
Investing in the transition to a more sustainable economy for 25+ years Compelling Global player with Strong, aligned investment weakening management opportunity competition team Economic transition: Only 8% of AUM from UK clients1 Management owns >20% of the growth & mispricing company 4 1As at 28
Slide 5: FY24 business highlights
FY24 business highlights • AUM “flat” at £37.2bn1 despite outflows • Fixed income: two acquisitions & process development • Distribution: further expansion & new products • Resilient financial & operational performance 1As at 30 September 2024. AUM: Assets under management. Assets under advice repre
Slide 6: Financial performance
Financial performance Financial highlights Shareholder equity (£m) 138.2 134.0 52.7 2024 131.1 Capital surplus & seed Adjusted operating 58.1 2023 48.1 profit (£m)1 Proposed dividend 50.6 51.5 67.4 2022 Capital required 30.2 32.2 30.1 30.1 Adjusted diluted Non cash items earnings per share 35.2 22.8
Slide 7: Recent narrow market (1): dominance of US mega-cap stocks
Recent narrow market (1): dominance of US “mega-cap” stocks Weight of Top 5 and Top 10 stocks in the S&P500 1 40% Top 5 Top 10 35% 30% 25% 20% 15% 10% 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 7 1Source: Impax analysis / Bloomberg data, as at 28 February 2025.
Slide 8: Recent narrow market (2): low percentage of stocks outperforming
Recent narrow market (2): low percentage of stocks outperforming Share of global stocks outperforming the index (MSCI ACWI) by year 1 60% Calendar year % Average 50% 40% 29% 30% 24% 20% 10% 0% 2010 2011 2012 2018 2019 2020 2009 2013 2014 2015 2016 2017 2021 2022 2023 2024 8 1Source: Impax analysis /
Slide 9: Major Impax strategies have underperformed generic indices over three years
Major Impax strategies have underperformed generic indices over three years... Select strategy performance versus benchmark (GBP, cumulative, %) 1 Past performance does not predict future returns Global Opportunities Leaders AUM £10.1bn (27%) AUM £6.9bn 2 (18%) Global Opportunities Leaders MSCI ACWI
Slide 10: …but other Impax strategies have outperformed
…but other Impax strategies have outperformed Select strategy performance versus benchmark (GBP, cumulative, %)1 Past performance does not predict future returns Core Bond International Sustainable Economy AUM £0.7bn (2%) AUM £1.0bn (3%) 43.5 Core Bond Int Sust Economy 36.2 Bloomberg US Aggregate2 M
Slide 11: Creditable investment performance versus peers
Creditable investment performance versus peers Performance of select strategies versus peer median return (USD, absolute, %) 1 Past performance does not predict future returns Water Specialists AUM £6.2bn (17%) AUM £3bn (8%) Water Specialists Peer Median Return Peer Median Return 30.2 22.5 22.4 23.8
Slide 12: Net outflows in FY24 dominated by two clients
Net outflows in FY24 dominated by two clients AUM (£ billion) 37.4 0.3 37.2 (3.1) 5.3 (0.7) (0.9) (1.1) 30/09/2023 BNPP SJP NA own label Other flows Market movement Acquired assets 30/09/2024 funds 12 As at 30 September 2024, assets under advice represent ~4% of total AUM. Acquired assets refers to
Slide 13: Our strategy
Our strategy 13
Slide 14: Our investment philosophy remains compelling
Our investment philosophy remains compelling Equity market Attractive period Shares of companies Impax’s strong focus sentiment robust for active advancing TSE1 on investment despite US policy management generally trading at discipline welcomed uncertainty expected low multiples by clients 14 1TSE:
Slide 15: Strategic priorities: organic growth in listed equities
Strategic priorities: organic growth in listed equities Building team management/leadership capabilities • Appointed Co-CIO (Listed Investments) • New Equity Research team head recruited Further strengthening the investment process • Created Global Equity Research function Launching new products • G
Slide 16: Strategic priorities: growth in private equity
Strategic priorities: growth in private equity Fund III: strong investment performance • Several recent exits: Norwegian hydropower; German wind • 42% of portfolio has been exited Fund IV: successful raising & investment • Final close at €459m the team’s largest fund to date • Portfolio today: 12 in
Slide 17: Strategic priorities: acquisitions to build scale in fixed income
Strategic priorities: acquisitions to build scale in fixed income AUM2 Investment team Investment strategies Offices (£bn) headcount • US High Yield Impax pre-acquisition 1.1 • Core Bond Team in US, UK 14 • Core Plus Bond • Global High Yield Absalon 0.3 Denmark 4 • EM Corp. Debt SKY Harbor Capital c
Slide 18: Trading update
Trading update 18
Slide 19: FY25 AUM movement to date
FY25 AUM movement to date Q1 (Oct to Dec 2024) • Investment performance challenged by narrow markets • Outflows included a small number of account losses, including smaller SJP fund AUM: £28.5bn Q2 to end of February 28/2/25 • 69% of AUM outperformed generic benchmarks in first two months of 20251 •
Slide 20: Market leadership has broadened significantly in 2025
Market leadership has broadened significantly in 2025 Global sector and “Magnificent 7” returns 2024 v 2025 YTD 1 2024 Net Total Return YTD as of Feb 28, 2025 67.3 31.6 31.6 24.3 20.3 7.8 12.3 11.8 6.1 4.8 4.2 7.3 3.9 3.9 3.5 4.1 1.1 5.0 2.3 1.7 (3.0) (0.8) (6.5) (8.1) Magnificent IT Telco. Financia
Slide 21: Europe and Asia (ex-Japan) outperforming the US this calendar year
Europe and Asia (ex-Japan) outperforming the US this calendar year Regional returns 2024 v 2025 YTD 1 2024 Net Total Return YTD as of Feb 28, 2025 25.0 22.9 20.4 19.0 14.8 13.0 9.6 10.0 1.4 (3.7) S&P 500 Stoxx 600 Topix (Japan) Hang Seng (Hong Kong) MSCI China 21 1Source: Impax analysis / Bloomberg
Slide 22: Response: Cost Reduction & Efficiencies
Response: Cost Reduction & Efficiencies • Since 1 October we have removed over 30 roles (c. 10%) without losing capabilities • Roles removed are from across the business • More than £11m in cost savings, broadly neutralising loss of SJP revenue (run-rate basis) 22
Slide 23: Response: Investments, Client Comms & Business Development
Response: Investments, Client Comms & Business Development Investment process • Steps to strengthen further • Created common global functions across listed equities and fixed income Client communications • Demonstrating our conviction in the investment opportunity • Focus on client service Business
Slide 24: Outlook
Outlook 24
Slide 25: Business outlook
Business outlook Q2: near-term flows • March: small number of institutional account closures (0.3% average fee, vs 0.49% average fee across the firm) Q3 & Q4: mandate wins • Encouraged by our pipeline and by some significant recent account wins Optimism about more favourable market conditions Ongoin
Slide 26: Capital allocation
Capital allocation • Continuing to maintain a healthy capital surplus, with no debt • Strong capital ratios • Working to optimise the capital allocation across: – Seeding new products – Acquisitions – Dividends – Share buy-backs • Market update to follow in the Interim Report 26
Slide 27: In summary…
In summary… Investment Compelling Strong financials performance Focus on cost strategic management & & options re turnaround in a opportunity optimal capital changed efficiency & plan allocation market 27
Slide 28: Appendices
Appendices 28
Slide 29: Thematic equities
Thematic equities Performance versus benchmark (cumulative, %) 1 Past performance does not predict future returns. Leaders AUM £6.9bn2 Water AUM £6.2bn Specialists AUM £3bn Leaders Water Specialists MSCI ACWI3 MSCI ACWI3 76.5 MSCI ACWI3 64.6 63.3 63.3 63.3 55.1 26.9 20.7 26.9 26.9 19.4 19.9 15.4 18.
Slide 30: Core equities
Core equities Performance versus benchmark (cumulative, %) 1 Past performance does not predict future returns. Global Opportunities AUM £10.1bn US Large Cap AUM £1.6bn Global Opportunities US Large Cap 91.4 92.8 MSCI ACWI2 69.6 S&P 500 Index3 Figures refer to the past and that past performance is no
Slide 31: Fixed income
Fixed income Performance versus benchmark (cumulative, %) 1 Past performance does not predict future returns. Figures refer to the past and that past performance is not a Core Bond AUM £0.7bn High Yield AUM £0.4bn reliable indicator of future results. 1AUM is in GBP and Core Bond High Yield performa
Slide 32: FY24: Investment performance versus peers
FY24: Investment performance versus peers Performance of five largest strategies versus peer median return (USD, absolute, %) 1 Past performance does not predict future returns. Global Opportunities Leaders Global Opportunities Leaders Peer Median Return Peer Median Return 30.2 29.0 28.2 29.0 12.1 1
Slide 33: FY24: Investment performance versus peers
FY24: Investment performance versus peers Performance of five largest strategies versus peer median return (USD, absolute, %) 1 Past performance does not predict future returns. Water Specialists Climate Water Specialists Climate 30.2 Peer Median Return Peer Median Return Peer Median Return 24.9 23.
Slide 34: Specialists: GIPS report– USD
Specialists: GIPS report– USD Past performance does not predict future returns. MSCI AC FTSE Com posite Description Total firm Com posite Annual Annual Asset 3yr World 3yr ET 3yr The Special ists Composite contains long onl y accounts, which invest assets assets Number of gross net MSCI AC FTSE ET w
Slide 35: Specialists: GIPS report– USD (continued)
Specialists: GIPS report– USD (continued) Firm Inform ation cal culated gross of management and custodial fees and net of The USD is the currency used to express performance, results are transacti on costs. Withholding taxes may vary according to the investor's affected by currency translation. Retu
Slide 36: Global Opportunities: GIPS report– USD
Global Opportunities: GIPS report– USD Past performance does not predict future returns. Composite Description Benchmark Total Firm Composite Number Annual Annual Annual Asset 3yr The Global Opportunities Composite contains long only 3yr accounts, which invest in high quality companies in order to Y
Slide 37: Global Opportunities: GIPS report– USD (continued)
Global Opportunities: GIPS report– USD (continued) Firm Information reducing monthly gross returns by the maximum applicable fee Other Disclosures according to the stated fee schedule below. Past performance Impax Asset Management is defined as Impax Asset does not guarantee future results. This per
Slide 38: Leaders: GIPS report– USD
Leaders: GIPS report– USD Past performance does not predict future returns. MSCI AC FTSE EOAS Com posite Description Total firm Com posite Annual Annual MSCI AC Asset 3yr World 3yr 3yr assets assets Number of gross net World annual FTSE EOAS weighted annualized annualized annualized The Leaders Comp
Slide 39: Leaders: GIPS report– USD (continued)
Leaders: GIPS report– USD (continued) Firm Inform ation Fees and Expenses Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Management (AIFM) Ltd., Impax Asset Management uses a model fee, which is the maxi mum appli cable fee, for the computation of Impax Asset Management
Slide 40: Asian Environmental: GIPS report– USD
Asian Environmental: GIPS report– USD Past performance does not predict future returns. Com posite Description MSCI AC FTSE EO Total firm Com posite Annual Annual Asset 3yr AP 3yr AP 3yr The Asian Environmental Composite contains long only accounts, assets assets Number of gross net MSCI AC FTSE EO
Slide 41: Asian Environmental: GIPS report– USD (continued)
Asian Environmental: GIPS report– USD (continued) Firm Inform ation foreign withholding taxes on dividends, interest income and capital gains, given the unav ailability of net of withholding taxes returns by FTSE. Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Managemen
Slide 42: Water: GIPS report– USD
Water: GIPS report– USD Past performance does not predict future returns. Com posite Description MSCI AC FTSE EO MSCI AC FTSE EO Water Total firm Com posite Annual Annual World Water Asset 3yr World 3yr Technology 3yr The Water Composi te contains l ong only accounts, which assets assets gross net i
Slide 43: Water: GIPS report– USD (continued)
Water: GIPS report– USD (continued) Firm Inform ation composite net-of-fee returns. Since May 2022, the highest management fee for the composite is 0.34%. Previously, the highest w as 0.35% from May 2021 to April 2022, 0.33% from March 2020 to April 2021, Impax Asset Management is defined as Impax A
Slide 44: Sustainable Food: GIPS report– USD
Sustainable Food: GIPS report– USD Past performance does not predict future returns. Com posite Description Benchmark Total firm Com posite Annual Annual Annual Asset 3yr 3yr The Sustainabl e Food Composi te contains l ong only accounts, assets assets Number of gross net benchmar k weighted annualiz
Slide 45: Sustainable Food: GIPS report– USD (continued)
Sustainable Food: GIPS report– USD (continued) Firm Inform ation Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Management (AIFM) Ltd., Impax Asset Management I reland Ltd, Impax Asset Management LLC, and Impax Asset Management (Hong Kong) Limi ted (together, “Impax”).
Slide 46: US Environmental Leaders: GIPS report– USD
US Environmental Leaders: GIPS report– USD Past performance does not predict future returns. Com posite Description Total Firm Composite Annual MSCI USA Asset 3yr MSCI USA 3yr The US Envi ronmental Leaders Composite contains long only accounts, Year Assets Assets Number of Gross Annual Net Annual We
Slide 47: US Environmental Leaders: GIPS report– USD (continued)
US Environmental Leaders: GIPS report– USD (continued) Firm Inform ation From January 2002 to October 2018 the gross returns for the separate accounts were cal culated usi ng the fee applicable to Impax Asset Management, whil st si nce November 2018 the fee used to gross up the returns is Impax Asse
Slide 48: International Sustainable Economy strategy: GIPS report– USD
International Sustainable Economy strategy: GIPS report– USD Benchmark Composite Description Total firm Com posite Annual Asset 3yr 3yr The International Sustainable Economy Strategy follows a assets assets Number of Annual gros s Annual net benchmar k weighted annualized annualized sustainable inve
Slide 49: International Sustainable Economy strategy: GIPS report– USD cont.
International Sustainable Economy strategy: GIPS report– USD cont. Firm Information computation of composite net-of-fee returns. Since April 2021, management fees used represent the actual unified fee paid out reduced by an estimated 10bps to exclude accounting expenses, Impax Asset Management is de
Slide 50: Global High Yield Bond (USD Hedged): GIPS report– USD
Global High Yield Bond (USD Hedged): GIPS report– USD Past performance does not predict future returns. Com posite Description ICE BofA Global ICE BofA Global High Yield Index The Global High Yield Bond Strategy seeks to generate long-term Total firm Com posite Annual Annual High Yield Index (USD He
Slide 51: Global High Yield Bond (USD Hedged): GIPS report– USD (continued)
Global High Yield Bond (USD Hedged): GIPS report– USD (continued) Firm Inform ation Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Management (AIFM) Ltd., Other D isclosures Impax Asset Management Ireland Ltd, Impax Asset Management LLC, and Impax Asset Management (Hong
Slide 52: US Small Cap: GIPS report– USD
US Small Cap: GIPS report– USD Past performance does not predict future returns. Russell Russell Composite Description Total firm Composite Annual Asset 3yr The US Small Cap Composite a core equities strategy Number of Annual net 2000 2000 3yr Year assets assets gross weighted annualized annualized
Slide 53: US Small Cap: GIPS report– USD
US Small Cap: GIPS report– USD Firm Information Fees and Expenses Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Management Impax Asset Management uses a model fee, which is the maximum applicable fee, for the (AIFM) Ltd., Impax Asset Management Ireland Ltd, Impax Asset
Slide 54: US Large Cap: GIPS report– USD
US Large Cap: GIPS report– USD Past performance does not predict future returns. Composite Description S&P 500 The US Large Cap Composite is a core equities strategy that fully Total Firm Composite Annual S&P 500 Asset 3yr 3yr integrates analysis of sustainability risks and opportunities and Assets
Slide 55: US Large Cap: GIPS report– USD
US Large Cap: GIPS report– USD Firm Information Fees and Expenses Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Management Impax Asset Management uses a model fee, which is the maximum applicable fee, for the (AIFM) Ltd., Impax Asset Management Ireland Ltd, Impax Asset
Slide 56: Climate: GIPS report– USD
Climate: GIPS report– USD Past performance does not predict future returns. Benchmark Composite Description Total firm Com posite Annual Asset 3yr 3yr assets assets Number of Annual gross Annual net benchmar k weighted annualized annualized The Climate Composite contains long only accounts, which Ye
Slide 57: Climate: GIPS report– USD cont.
Climate: GIPS report– USD cont. Firm Information management fee for the composite is 0.60%. Previously, the highest was 0.55% from May 2021 to January 2022, 0.54% from May 2020 to April 2021, 0.55% from May 2019 to April 2020, Impax Asset Management is defined as Impax Asset Management Ltd, Impax As
Slide 58: Core Bond: GIPS report– USD
Core Bond: GIPS report– USD Past performance does not predict future returns. Composite Description Bloomberg Bloomberg The Core Bond Strategy seeks competitive risk-adjusted returns while Barclays US Barclays US offering broad fixed income diversification and positive environmental Total firm Compo
Slide 59: Core Bond: GIPS report– USD
Core Bond: GIPS report– USD Firm Information to purchase or sell any particular securities held in composite accounts. Market conditions can vary widely over time and can result in a loss of portfolio value. Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Management (AIF
Slide 60: High Yield Bond: GIPS report– USD
High Yield Bond: GIPS report– USD Past performance does not predict future returns. Composite Description The High Yield Bond Strategy seeks to deliver high current income and ICE BOFA US strong risk-adjusted total returns through a process that employs ICE BOFA US cash pay high rigorous credit anal
Slide 61: High Yield Bond: GIPS report– USD
High Yield Bond: GIPS report– USD Firm Information Impax Asset Management is defined as Impax Asset Management Ltd, Impax Asset Management Fees and Expenses (AIFM) Ltd., Impax Asset Management Ireland Ltd, Impax Asset Management LLC, and Impax Asset Management (Hong Kong) Limited (together, “Impax”)
Slide 62: Impax Sustainable Infrastructure Strategy: GIPS report– USD
Impax Sustainable Infrastructure Strategy: GIPS report– USD Past performance does not predict future returns. MSCI AC World FTSE GIO 3yr Total Firm Assets Composite Assets Number of Annual Gross Annual Net MSCI AC FTSE GIO Asset Weighted 3yr Annualized 3yr Annualized Annualized Std Year (Millions) (
Slide 63: Impax Sustainable Infrastructure Strategy: GIPS report– USD
Impax Sustainable Infrastructure Strategy: GIPS report– USD Claiming GIPS Compliance fees returns are calculated by reducing monthly gross returns by the maximum applicable fee according to the stated fee schedule below. Past performance does not guarantee future results. Impax Asset Management clai
Slide 64: Global Social Leaders: GIPS report– USD
Global Social Leaders: GIPS report– USD Past performance does not predict future returns. MSCI AC Claiming GIPS Compliance Impax Asset Management claims compliance with Global Investment 3yr World 3yr Performance Standards (GIPS®) and has prepared and presented this report in Total Firm Composite An
Slide 65: Global Social Leaders: GIPS report– USD
Global Social Leaders: GIPS report– USD Benchmark Description Other Disclosures The MSCI All Country World Index is a free float-adjusted market capitalization weighted index Trading may occur in local currency, but it is converted to base currency based on Bloomberg that is designed to measure the
Slide 66: Important information
Important information Not for release, publication or distribution, directly or indirectly, in or into, any jurisdiction where to do so might const itute a violation of the relevant laws or regulations of such jurisdiction The information contained in this confidential document (the “Presentation”)
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