Gam Holding Ag · SIX:GAM
Gam — FY2022 Earnings Presentation
38 slides from Gam's earnings presentation, May 4, 2023
Slide 1: Strategic Update; 2022 Results & Q1 2023 IMS
Strategic Update; 2022 Results & Q1 2023 IMS 04 May 2023 Put a half & half picture here
Slide 2: Agenda
Agenda Speakers Content David Jacob Chairman Strategic Update – David Jacob Review of 2022 & 2023 update – Peter Sanderson 2022 Financial Results – Sally Orton Peter Sanderson Q&A Group CEO Sally Orton Group CFO 2
Slide 3: Strategic Update
Strategic Update David Jacob, Chairman
Slide 4: Strategic update
Strategic update GAM Board unanimously recommends offer from Liontrust Asset Management for GAM • Financial performance challenged: income down 23% compared to 2021; IFRS loss of CHF 290 million and cash down 41%. Context • 30% cost reduction since 2019 not sufficient to put GAM on sustainable traje
Slide 5: Strategic update
Strategic update Offer worth CHF 0.6723 per share; almost 20% shareholders already indicate support • The offer is of 0.0589 ordinary shares of Liontrust for one GAM share, which on the basis of the volume-weighted average price of the Liontrust shares over the past 60 trading days, values each GAM
Slide 6: Review of 2022 & 2023 update
Review of 2022 & 2023 update Peter Sanderson, Group CEO
Slide 7: 2022 Full Year Results
2022 Full Year Results Challenging financial results against backdrop of good investment performance • Total assets under management (AuM) were CHF 75.0 billion as at 31 December 2022, with Investment Management at CHF 23.2 billion. Group AuM and Fund Management Services at CHF 51.8 billion, compare
Slide 8: Q1 2023 Update
Q1 2023 Update Strong investment performance: 91% outperformance vs benchmark1 Investment • AuM at CHF 23.3 billion as at 31 March 2023 up from CHF 23.2 billion as at 31 December 2022. Management • Net client outflows of CHF 0.6 billion and net positive market and foreign exchange (FX) movements of
Slide 9: 2022 Financial Results
2022 Financial Results Sally Orton, Group CFO
Slide 10: Financial summary
Financial summary 2022: a challenging year (in CHF m, except where indicated) 1 2022 2021 Change Investment management, advisory and other fees 459.3 633.9 (28%) Distribution, fee and commission expenses (297.5) (425.9) (30%) Net management fees and commissions 161.8 208.0 (22%) Net performance fees
Slide 11: Management fee margin
Management fee margin Fee margins stable Investment Management (in bps) Fund Management Services (in bps) 5.4 60.31 55.81 1 53.6 52.71 51.01 4.3 3.9 4.1 4.0 2018 2019 2020 2021 2022 2018 2019 2020 2021 2022 • Investment management full year margin at 51.0bps down from 52.7bps at FY 2021 due to asset
Slide 12: Expenses
Expenses Underlying expenses reduced by CHF 27.0 million (in CHF m, except where indicated) Change Change 2022 2021 in CHF in % 1 Fixed personnel expenses 91.7 104.8 (13.1) (13%) Driven by headcount reduction. 2 22.0 Variable personnel expenses 38.3 (16.3) (43%) Driven by lower performance fee bonus
Slide 13: IFRS net loss
IFRS net loss Impacted by underlying net loss after-tax (CHF 39.0m) and after-tax non-core net expenses (CHF 251.3m) (in CHF m, except where indicated) 2022 2021 Underlying (loss) before taxes (42.5) (9.6) Acquisition-related items1 (0.3) (8.1) Non-core items2 224.0 13.7 IFRS (loss) before taxes (26
Slide 14: Cash and Capital
Cash and Capital 41% reduction in cash at consolidated and 75% reduction at parent level Cash and adjusted tangible equity1 (in CHF m) 272 271 250 235 189 196 178 174 172 138 164 30.06.20 69 31.12.20 30.06.21 31.12.21 30.06.21 31.12.22 Net cash Adjusted tangible equity 2 Source: GAM. 14 1 Detailed b
Slide 15: Q&A
Q&A
Slide 16: Appendix
Appendix
Slide 17: Assets under management
Assets under management Investment Management (in CHF bn) (2.6) (4.5) (0.5) (0.2) 31.0 23.2 31.12.2021 Net flows Market performance FX impact Disposal 31.12.2022 Fund Management Services (in CHF bn) (8.8) (1.4) (6.0) 68.0 51.8 31.12.2021 Net flows Market performance FX impact 31.12.2022 17
Slide 18: Available Cash
Available Cash 31.12.2022 31.12.2021 Source CHF m CHF m (as per the Annual Report 2022) Cash and Cash equivalents 137.9 234.8 Conslidated Balance Sheet, p. 127 Other Current Assets 79.8 114.7 Conslidated Balance Sheet, p. 127 Current Liabilities -130.7 -190.4 Conslidated Balance Sheet, p. 127 Net av
Slide 19: Investment performance
Investment performance % of AuM outperforming benchmark 1 3-year 5-year Asset Class 31.12.2022 31.12.2021 31.12.2022 31.12.2021 Fixed income 48% 56% 48% 46% Absolute return - 100% - 100% Equity 68% 91% 68% 83% Systematic - - - - Alternatives 59% 68% 67% 68% Total 55% 68% 55% 60% 2 % of fund AuM outp
Slide 20: Investment management AuM
Investment management AuM Change from 6 to 4 asset classes & change in method of presentation Investment Management (in CHF bn) Opening Presentation Adjusted AuM Asset Class AuM Asset Class AuM 1 adjustement to 1 Jan 2022 by Net flows Disposal Market/FX Reclassification 2 2 31.12.22 1 Jan 2022 AuM a
Slide 21: IM fee margin by Asset Class
IM fee margin by Asset Class Post reclassification Management fee margin by Asset Class1 (in bps) Fixed income Equity 67 64 61 61 61 59 FY 2021 H1 2022 FY 2022 FY 2021 H1 2022 FY 2022 Alternatives Multi asset 59 58 47 23 24 22 FY 2021 H1 2022 FY 2022 FY 2021 H1 2022 FY 2022 Source: GAM 21 1 Average
Slide 22: AuM and net flows by Asset Class
AuM and net flows by Asset Class Investment Management AuM by Asset Class (in CHF bn) 31.12.18 31.12.18 30.06.19 30.06.19 31.12.19 31.12.19 30.06.20 30.06.20 31.12.20 31.12.20 30.06.21 30.06.21 31.12.21 31.12.21 30.06.22 30.06.22 31.12.22 reclassed reclassed reclassed reclassed reclassed reclassed r
Slide 23: AuM and net flows by client segment
AuM and net flows by client segment Investment Management AuM by client segment (in CHF bn) 30.06.18 31.12.1830.06.19 31.12.19 30.06.20 31.12.20 30.06.21 31.12.21 31.12.21 30.06.22 30.06.22 31.12.22 reclassed reclassed and and adjusted adjusted 1 1 Intermediaries 41.8 27.4 23.9 23.0 16.1 18.3 17.8 1
Slide 24: Fund Management Services AuM breakdowns
Fund Management Services AuM breakdowns By fund domicile (in CHF bn, except where indicated) 31.12.18 30.06.19 31.12.19 30.06.20 31.12.20 30.06.21 31.12.21 30.06.22 31.12.22 Switzerland 33.3 36.4 34.5 33.7 34.9 36.6 14.4 12.7 12.1 Rest of Europe 42.8 47.6 49.8 50.2 51.2 54.6 53.6 43.4 39.7 Total 76.
Slide 25: Key figures
Key figures Investment Management (in CHF, except where indicated) INVESTMENT MANAGEMENT FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 Net management fees and commissions (m) 453.6 284.9 196.5 175.6 136.6 Net performance fees (m) 4.5 12.8 2.8 19.3 3.2 Net fee and commission income (m) 458.1 297.7 199.3 19
Slide 26: Performance fee eligible assets and income
Performance fee eligible assets and income Performance fee eligible assets¹ (in CHF bn) 31.12.18 30.06.19 31.12.19 30.06.20 31.12.20 30.06.21 31.12.21 30.06.22 31.12.22 Unconstrained fixed income - - - - - - - - - Global macro/managed futures 0.6 0.4 0.3 0.1 0.1 0.1 0.1 0.2 0.2 Non-directional equit
Slide 27: General expenses
General expenses (in CHF m) 2022 2021 Change Occupancy 4.5 6.2 (27%) Technology and communication 15.9 16.3 (2%) Data and research 21.2 20.0 6% Professional and consulting services 11.4 7.8 46% Marketing and travel 5.8 5.8 0% Administration 3.7 5.2 (29%) Other general expenses 13.3 11.9 12% General
Slide 28: Operating margin and compensation ratio
Operating margin and compensation ratio (in CHF m) 2018 2019 2020 2021 2022 Net fee and commission income 499.9 329.9 233.2 227.3 165.0 Net other (expenses) / income 0.3 (3.7) (4.0) (2.4) - Income 500.2 326.2 229.2 224.9 165.0 - Personnel expenses 239.6 197.0 150.5 143.1 113.7 General expenses 127.7
Slide 29: Basic and diluted underlying EPS
Basic and diluted underlying EPS (in million shares, except where indicated) 2018 2019 2020 2021 2022 Weighted average number of shares in issue 159.7 159.7 159.7 159.7 159.7 Weighted average number of treasury shares held 4.3 4.2 3.1 3.6 3.4 Weighted average number of shares outstanding for basic E
Slide 30: Currency split – revenues, expenses and AuM
Currency split – revenues, expenses and AuM Group income1 Group expenses2 Investment management AuM FY 2022 FY 2022 as at 31.12.2022 4% 7% 15% 7% 16% 26% 23% 42% 14% 40% 7% 10% 28% 41% 20% USD EUR GBP CHF Other Source: GAM. 30 1 Percentage splits are estimated based upon the currency exposure of the
Slide 31: Group balance sheet
Group balance sheet (in CHF m) 31.12.18 31.12.19 31.12.20 31.12.21 31.12.22 restated Cash and cash equivalents 328 316 271 235 138 Seed capital investments 68 46 23 16 5 Other assets 207 260 230 199 127 Goodwill and other intangible assets 725 713 296 305 83 Assets 1’328 1’335 820 755 353 Current li
Slide 32: Net cash
Net cash (in CHF m) (39) 235 (23) (11) (3) (16) (6) 1 138 Opening Underlying net profit Net impact of annual FCA fine Net investment in Defied benefit FX Others Closing bonuses platform and lease pension repair obligations payments Source: GAM. 32
Slide 33: Adjusted tangible equity
Adjusted tangible equity1 (in CHF m) (61) 174 (7) (14) (19) 3 (7) 69 Opening IFRS net loss excl. Investment in platform Pension FX impacts Net impact of share Change in net assets Closing Impact of intagibles remausurement purchases and liabilities Source: GAM. 33 1 Adjusted tangible equity is defin
Slide 34: FY 2022 Investment performance
FY 2022 Investment performance % of fund AuM outperforming the benchmark % of fund AuM outperforming Morningstar peer group 68% 70% 60% 55% 55% 67% 66% 62% 31.12.2021 31.12.2022 31.12.2021 31.12.2022 3 years 5 years Decline in the 3-year1 investment % of fund AuM outperforming the 5-year investment
Slide 35: Q1 2023 Investment performance
Q1 2023 Investment performance % of fund AuM outperforming the benchmark % of fund AuM outperforming Morningstar peer group 76% 91% 68% 55% 55% 67% 67% 66% 31.12.2022 31.03.2023 31.12.2022 31.03.2023 3 years 5 years Increase in the 3-year1 and 5-year % of fund AuM outperforming the investment perfor
Slide 36: Corporate calendar and contacts
Corporate calendar and contacts Forthcoming events 25 May 2023 Annual General Meeting 2023 3 August 2023 Half-year results 2023 19 October 2023 Q3 2022 Interim management statement Group Communications and Investor Relations Charles Naylor Ute Dehn Christen Head of Group Communications Senior Commun
Slide 37: Cautionary statement on forward-looking information
Cautionary statement on forward-looking information This presentation by GAM Holding AG (‘the Company’) does not constitute an invitation or offer to acquire, purchase or subscribe for securities. This presentation by the Company includes forward-looking statements that reflect the Company’s intenti
Slide 38: www.gam.com
GAM Investments www.gam.com