Impax Asset Management Group Plc · LSE:IPX
Impax Asset Management — H1 2014 Earnings Presentation
31 slides from Impax Asset Management's earnings presentation, 2014
Slide 1: Impax Asset Management Group plc Interim Results to 31.03.2014
Impax Asset Management Group plc Interim Results to 31.03.2014
Slide 2: Agenda
Agenda • Business update Ian Simm (Chief Executive) • Interim results • Q&A Charlie Ridge (CFO) 2
Slide 3: Highlights
Highlights • Assets under management (“AUM”) increased 16% to £2.548 billion (31 March 2014) from £2.197 billion (30 September 2013) • Strong net inflows of £189m (H1, 2013: £100m) • Revenue in the first half of 2014 was £9.9m (H1, 2013: £8.7m) • Operating earnings1 were £2.7m (H1, 2013: £1.8m) • Un
Slide 4: Queen’s Award for Enterprise: Sustainable Development
Queen’s Award for Enterprise: Sustainable Development • Recognition of highest levels of excellence in business • Only asset manager to hold the award • Further raises our profile in overseas investment community 4
Slide 5: Policy Drivers – Regulation Continues to Tighten
Policy Drivers – Regulation Continues to Tighten US China Environmental Protection Agency’s measures (“CAFE Commitment to spend US$339 billion to combat water Standards”) to clean up vehicle emissions – 54.5 mpg fleet pollution by 2017 average by 2025 Germany India Policy requiring replacement of ap
Slide 6: Deepening Concern on Climate Change
Deepening Concern on Climate Change US drought US National Climate Assessment UK Floods 2014 IPCC ‐ Climate Change Reports 6
Slide 7: Changing Investor Attitudes
Changing Investor Attitudes 7
Slide 8: Strong Investment Performance
Strong Investment Performance Annualised Performance EPS Growth 6 Months 1 Year 3 Years 5 Years 10 Years PE Ratio to 31.03.2014 in GBP (%) (%) Specialists 11.0 19.3 6.5 15.4 11.2 26.5 19.1x FTSE ET100 Index 11.7 29.5 0.9 7.0 7.7 26.7 22.5x Leaders 6.6 12.6 9.3 15.9 ‐‐ 12.8 17.1x FTSE EOAS Index 6.8
Slide 9: Water Strategy
Water Strategy BNP Paribas Aqua Fund AUM (£m) • Continuing strong signals for 30 Nov 2008 8 long‐term investment 30 Sept 2012 68 • European inflows continue from 30 Sept 2013 364 wider distribution network 31 Mar 2014 509 • One of the best performing, largest water funds in the Investment performanc
Slide 10: Private Equity – Infrastructure Investment
Private Equity – Infrastructure Investment NEF II: Geographical distribution of assets First exits from NEF II • €330 million fund, currently 62% (net) invested • Sale of two French windfarms (total 22MW) • Strong market demand for operating assets in 2.6 % stable countries Eolien de St Riquier 23.5
Slide 11: US: Strong Growth and Prospects
US: Strong Growth and Prospects • Business development since 2006 AUM from US investors as at 31.03.2014. (£m) • Strong potential with limited competition Pax World 2009 − New interest in resource efficiency 9.4 − Major consultants recommending Impax Delaware funds 2010 16.5 US private bank • Four p
Slide 12: Impax AUM Breakdown
Impax AUM Breakdown Investment strategy AUM (£) 31 Mar’14 AUM (£) 30 Sep’13 % Increase Specialists 862m 819m 5.2% ‐ Impax Environmental Markets plc 384m 363m ‐ Impax Environmental Markets (Ireland) 115m 104m ‐ Impax GRO Fund LP 12m 11m ‐ Third Party funds/accounts 351m 341m Leaders 488m 409m 19.1% ‐
Slide 13: AUM (£m) Analysed by Geographic Region (Client Domicile)
AUM (£m) Analysed by Geographic Region (Client Domicile) Principal funds/partners • Impax Environmental Markets plc 677 • Impax Environmental Markets (Ireland) Fund UK/Ireland 634 • Impax Asian Environmental Markets (Ireland) Fund • Impax Food and Agriculture Fund 1263 • BNP Paribas Investment Partn
Slide 14: Flows for “Impax label” and Third Party Funds/Accounts
Flows for “Impax label” and Third Party Funds/Accounts “Impax label” funds (£m) Third party funds/accounts (£m) 31 Mar 2014 539 31 Mar 2014 1,633 Market Market 49 117 movement movement Inflows 12 Inflows 310 Outflows (25) Outflows (109) 1 Oct 2013 503 1 Oct 2013 1,314 Note: the data above refers to
Slide 15: Interim Results: Financial Highlights (1)
Interim Results: Financial Highlights (1) Revenue (£m) Operating costs (£m) Operating earnings (£m) H1 52.2% H1 2014 2.7 H1 2014 9.9 20.5% 7.2 2014 H1 53.6% 24.6% 6.8 H1 2013 1.8 H1 2013 8.7 2013 2013 18.5 2013 52.9% 23.5% 14.1 2013 4.3 Staff costs Other costs (% of revenue) (% of revenue) • Revenue
Slide 16: Interim Results: Financial Highlights (2)
Interim Results: Financial Highlights (2) Diluted adjusted* EPS (p) Dividend (p) 1.20 2014 0.30* 1.20** H1 2014 Effect of share buy 0.04 2013 0.90 backs and dilution (0.29) 2012 0.75 EIA charges Increase in fair (0.41) 2011 0.70 value losses Increase in 0.64 2010 0.60 operating earnings Tax benefits
Slide 17: Interim Results: Financial Highlights (3)
Interim Results: Financial Highlights (3) Investments (£m) Cash reserves (£m) Cash reserve analysis (£m) Cash as at 31 Mar 2014 12.8 12.8 31 Mar 2014 31 Mar 8.6 2.6 11.2 Investment hedges 2014 (0.7) and treasury income Short‐term net (0.9) liabilities Mark Working capital 0.2 to 0.1 market Net seed
Slide 18: Outlook
Outlook Attractive prospects for target markets to Active investment management ideal for sustain “superior growth” exploiting inefficient prices • Major overhaul underway in energy policies • Rapidly changing market drivers worldwide • Expert team can interpret technology and • Heightened profile o
Slide 19: Disclaimer
Disclaimer All sources Impax Asset Management Group plc unless otherwise stated. This document has been prepared by Impax Asset Management Group plc and approved by Impax Asset Management Limited (Impax, authorised and regulated by the Financial Conduct Authority). The information and any opinions c
Slide 20: Appendix
20 Appendix IMPAX)
Slide 21: Impax’s Listed Equity Investment Strategies
Impax’s Listed Equity Investment Strategies Global All cap AUM Inception date Specialists Universe: 1100 companies Small‐Mid £862m Mar 2002 Universe Size: $1.4 T market cap Leaders Universe: 1500 companies £488m Mar 2008 Universe Size: $4T market cap Water Universe: 250 companies £797m Jan
Slide 22: Valuation indicators
Valuation indicators Liquid Assets (£m) Shares reconciliation* (m) Diluted shares 117.9 H1 8.0 8.6 16.6 2014 ESOP Dilution 0.4 Basic shares 117.5 2013 9.8 6.2 16.0 Share buy backs 10.3 Available cash Liquid Seed Shares in issue 127.7 investments • Historical incentive schemes fully vested and relate
Slide 23: Impax Equity Interests as at 31 March 2014
Impax Equity Interests as at 31 March 2014 IPX ordinary shares Employee Incentive Schemes (Total 127.7m) % Impax Share Strike price Exercise Period Options BNP Paribas Option Scheme outstanding 30.6% 25.2% Investment Partners Granted Directors & staff* FY11 ESOP 49.6p 1 Jan 2015 ‐ 31 Dec 2017 4,540,
Slide 24: Impax Seed Investments
Impax Seed Investments Theme Principal funds / Investee Investments* % of Initial Comments (£m) Fund Investment AUM Date Specialists Impax Global Resource 3.1 27% Nov‐11 Withdrawals Nov 2013 $1m & Feb 2014 $1m Optimization Fund Food & Agriculture Impax Food and Agriculture 2.3 81% Dec‐12 Fund Water
Slide 25: Income Statement
Income Statement 6 months 6 months Year ended ended ended 2014 2013 2013 £'000 £'000 £'000 Revenue 9,911 8,671 18,463 Bonuses (2,064) (1,572) (3,558) Other operating costs (5,175) (5,261) (10,566) Operating costs (7,239) (6,833) (14,124) Operating earnings 2,672 1,838 4,339 Share‐based payment charg
Slide 26: Balance Sheet
Balance Sheet 31 Mar 2014 31 Mar 2013 30 Sep 2013 £'000 £'000 £'000 Goodwill and intangibles 1,696 1,744 1,724 Other non‐current assets 356 604 473 2,052 2,348 2,197 Cash and cash equivalents 12,783 15,244 16,553 Current asset investments 11,647 9,224 9,336 Other current assets 5,553 4,038 3,509 Tot
Slide 27: Impax Asset Management: Investing Since 1998
Impax Asset Management: Investing Since 1998 (calendar year) Year Milestone AUM (£m) 1998 Impax Asset Management founded 15 1999 First listed equity mandate and Impax ET50 Index 22 2000 36 2001 Listing on AIM 39 2002 Launch of Impax Environmental Markets plc 55 2003 68 2004 Launch of Impax Environme
Slide 28: Distribution Strategy: Institutional Quality Global Platform
Distribution Strategy: Institutional Quality Global Platform UK / Ireland • IEM plc North America • UCITS Platform • PaxWorld • Old Mutual Ethical Fund • Mandate from US Private Bank • Two offices (NYC & Portland) Europe • BNP Paribas − Expansion of water fund beyond France Asia Pacific • ASN ‐ Envi
Slide 29: Competitors
Competitors Listed Equities • Products from large, branded asset managers not typically “consultant quality” • Limited number of boutiques • Sub‐sector products, e.g. alternative energy, tend to underperform broader strategies • Little direct competition in North America, Asia Private Equity • Estab
Slide 30: Extensive Expertise
Extensive Expertise Keith Falconer Ian Simm Charlie Ridge • Chairman since • Chief Executive • CFO 2004 • 24 years’ • 27 years’ • 33 years’ experience experience experience Bruce Peter Ominder Ken David Kaye Jenkyn‐Jones Rossbach Dhillon Locklin Richardson Forrest • MD, Listed • MD, Private • Head o
Slide 31: Strong Investor Relationships
Strong Investor Relationships 100+ Institutions US Private Bank European Institution 31
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