L1 Group Limited · ASX:L1G
L1 — H1 FY2023 Earnings Presentation
33 slides from L1's earnings presentation, Feb 22, 2023
Slide 1: 2023 Half-Year Financial Results – Analyst Briefing (ASX cover letter)
22 February 2023 The Manager ASX Market Announcements Australian Securities Exchange Limited Sydney NSW 2000 Platinum Asset Management Limited (PTM) – 2023 Half-Year Financial Results – Analyst Briefing PTM encloses for release to the market the presentation deck for the analyst briefing on the PTM
Slide 2: Analyst Briefing
Platinum Asset Platinum Asset Management Management Limited Limited Analyst Briefing February 2023 2022 24 FEBRUARY Platinum Asset Management Limited ABN 13 050 064 287
Slide 3: Analyst Briefing – Presented by
Analyst Briefing Presented by: Andrew Clifford Andrew Stannard Co-Founder Finance Director 2
Slide 4: Key Highlights
Key Highlights Half-year ended 31 Dec-22 One of Australia’s most trusted international investment A$18.2b >70% managers with global long-short strategy Closing FUM1 FUM is Retail +15.6% +4.7% Strong 1 yr performance in flagship Platinum International Outperformance Outperformance Fund (PIF) and
Slide 5: Financial Highlights
Financial Highlights Half year ended 31 December 2022 31-Dec-22 Var. pcp Average FuM (A$b) 17.8 (21)% Average Fee (bps) 112 (4)% Management Fees (A$m) 99.3 (24)% Total Revenue (A$m) 102.3 (21)% Expenses incl. share-based payments (A$m) 48.2 11% NPAT (A$m) 37.6 (37)% Interim Dividend (cps) 7cps (30)%
Slide 6: Investment Performance Calendar Year 2022
Investment Performance Calendar Year 2022 Platinum Trust Funds A$12b 7 out of 8 Platinum Trust Funds outperformed (66% of Total FUM) v index in 2022 15.6% 1% 4% 2% 4% International 3% Fund, 59% 4% 4.7% 4.5% 4.3% 4.3% 4.1% 3.6% Asia International Asia Fund Technology Japan Fund Global Brands European
Slide 7: Net inflows follow Platinum outperformance…
Net inflows follow Platinum outperformance… Improved performance is a strong leading indicator for future net inflows Platinum Internal Fund 1yr Relative Outperformance Platinum’s Net Inflows in the Next Twelve Months v Index (%) (A$b) 40% 4.0 3.6 34% 33% 30% 3.0 29% 28% 2.6 2.5 20% 2.0 16% 1.6 10%
Slide 8: Platinum’s consistent investment process
Platinum’s consistent investment process Designed to be there for clients when they need support the most Performance during previous major market drawdowns Market events in the last 3 years MSCI AC World Net Index (A$) Platinum International Fund 22% 8% 6% 3% -12% -11% -16% -15% -18% -23% -41% -50%
Slide 9: Designed especially for long term investors who want lower volatility and downside protection
Designed especially for long term investors who want lower volatility and downside protection MARKET # of Australian SMSF’s > Platinum PT Fund Platinum LIC and QMF # of Australian HNWI’s 4 $1m 3 direct client accounts 1 client accounts 1 20,000 26,000 250,000 630,000 Australian individuals with > $2
Slide 10: Unwavering focus in delivering strong long-term client outcomes
Unwavering focus in delivering strong long-term client outcomes through a differentiated investment approach Risk Contrarian Bottom-up management Team1 Ethics A contrarian long- A bottom up, index- Focus on downside A dedicated and Uncompromising term investment agnostic approach to protection exper
Slide 11: The Ebb and Flow of Markets
The Ebb and Flow of Markets Eulogistic Phase Platinum Sells Deterioration Boredom Price Discovery Platinum Invests Unloved Time This information is general in nature and does not take into account your specific needs or circumstances. You should consider your own financial position, objectives and 1
Slide 12: Equity Markets - Where are we now?
Equity Markets - Where are we now? Historic US equity bubble deflating Stage 1 – Rising Stage 2 – Earnings interest rates disappoint Opportunities are elsewhere! Fundamentally Tighter monetary What has worked for different monetary conditions represent a the last decade, environment to the significa
Slide 13: Where to from here?
__.. Where to from here?
Slide 14: Strong drivers for future growth
Strong drivers for future growth Platinum International Fund long-short value proposition once again proven 1 Investment Platinum Asia Fund ahead of benchmark across all time periods performance Outflows slowing, retail gross flows set to rebound New thematic fund launched (PGTX) New Healt
Slide 15: Platinum Global Transition Fund (PGTX) launched
Platinum Global Transition Fund (PGTX) launched Embraces Platinum’s existing investment approach Invests in companies seeking to financially benefit from the transition away from fossil-fuel derived energy and goods production and consumption - that is the carbon transition This is a multi-dec
Slide 16: Financial performance
__. Financial performance
Slide 17: Flows, Average FUM and Operating Results
Flows, Average FUM and Operating Results Vs Prior Half Corresponding Period Dec-22 Jun-22 Dec-22 Dec-21 Net Flows (A$m) 12% -18% -1,096 -1,096 -929 -1,239 20.2 22.5 -12% 17.8 Average FUM 17.8 -21% (A$b) Dec-22 Jun-22 Dec-22 Dec-21 119.1 133.6 99.3 -17% 99.3 -26% Fee Revenue (A$m) Dec-22 Jun-22 Dec-2
Slide 18: Flows
Flows Gross Inflows (A$m) Annual Gross Inflows Semi-Annual Gross Inflows 313 Gross inflows for the 6 months to 31 Retail Funds December 2022 were $498m 238 Institutional Largest gross inflows in International and 144 185 46 Asia 3,391 2,483 28 63 81 1,560 1,371 7 1,190 18 850 713 847 491 340 202
Slide 19: Revenue Analysis
Revenue Analysis Half year ended 31 December 2022 Dec-22 H Dec-21 H Var. (A$m) (A$m) Average FuM (A$b)* 17.8 22.5 (4.7) Revenue largely reflects changes in FuM and Average Fee (bps)** 112 117 (5) FuM mix shifts Management fees 99.3 131.1 (31.8) Interest income from increasing interest rates Perf
Slide 20: Expenses
Expenses Half year ended 31 December 2022 Dec-22 H Dec-21 H Var. (A$m) (A$m) Staff costs 15.5 13.8 1.7 Staff expenses are up, primarily due to higher Variable remuneration, incl. share-based variable compensation accruals due to strong 17.2 12.7 4.5 investment performance payments expense Custody
Slide 21: Strong Balance Sheet and Seed Investment Portfolio
Strong Balance Sheet and Seed Investment Portfolio As at 31 December 2022 328 324 341 Net Assets* (A$m) Dec-22 Jun-22 Dec-21 186 177 192 Cash & Term Deposits (A$m) Dec-22 Jun-22 Dec-21 Interim Final 12 7 Dividends 7 10 12 (cps) FY Jun-23 FY Jun-22 FY Jun-21 154 144 151 Seed Investments** (A$m) Dec-2
Slide 22: Questions
Questions 21
Slide 23: Appendix
—__.. Appendix
Slide 24: Appendix 1: Detailed operating results
Appendix 1: Detailed operating results Half year ended 31 December 2022 (A$m) Dec-22 H Dec-21 H % Change Management fees 99.3 131.1 -24.3% Performance fees 0.0 2.5 -100.0% Interest income 1.7 0.2 Large Net gains/(losses) on seed investments, FX and other income 1.3 (5.1) Large Total Revenue 102.3 12
Slide 25: Appendix 2: Performance fees
Appendix 2: Performance fees Carry FUM $m Performance Participation Performance Funds Benchmark forward at (Dec-22) fee period to Rate % fee last paid** Dec-22* Retail Funds Platinum International Fund 25 30 Jun & 31 Dec MSCI AC World Net Index in A$ 15% -18.0% 31 Dec 17 & LICs Platinum Asia ex-Japa
Slide 26: Appendix 3: Underlying profit
Appendix 3: Underlying profit Current period profit less impacted by volatility of seed investments relative to previous period Dec-22 H Dec-21 H Var. (A$m) (A$m) Statutory NPAT 38 60 (22) Net (gain)/loss on financial assets at (1) 2 (3) fair value through profit and loss Net share of (profit)/loss
Slide 27: Appendix 4: Segment analysis
Appendix 4: Segment analysis Half year ended 31 December 2022 Dec-22 H Dec-21 H Dec-22 H Dec-21 H Funds Management Var. % Investment and other Var. % (A$m) (A$m) (A$m) (A$m) Fee Revenue 99.3 133.6 -25.7% Fee Revenue - - -- Other Revenue 0.9 - Large Other Revenue 2.1 (4.9) Large Total Revenue 100.2 1
Slide 28: Appendix 5A: Funds under management by product
Appendix 5A: Funds under management by product Half year ended 31 December 2022 (A$m) Opening balance Investment Distributions Closing balance % of Funds Net flows (1 Jul 2022) performance & Other3 (31 Dec 2022) Total Retail offerings Platinum Trust Funds (excluding funds fed from PIXX and PAXX) and
Slide 29: Appendix 5B: Funds under management by strategy
Appendix 5B: Funds under management by strategy A broad array of global equity services Half year ended 31 December 2022 (A$m) Opening balance Investment Distributions Closing balance Investment strategy Net flows % of Total (1 Jul 2022) performance & Other* (31 Dec 2022) Global long short 11,781 (4
Slide 30: Appendix 6: Share-based payment expense
Appendix 6: Share-based payment expense Five year future estimated amortisation profile 1 ($Am) HY 2023 FY 2023 FY 2024 FY 2025 FY 2026 FY 2027 Deferred Remuneration Plan2 2019 annual grant 0.8 1.4 2020 annual grant 0.9 1.5 1.7 2021 annual grant 0.8 1.6 1.8 2.0 2022 annual grant 0.7 1.5 1.6 1.9 2.0
Slide 31: Appendix 7: Investment Performance to 31 Dec 2022
Appendix 7: Investment Performance to 31 Dec 2022 International, Asia, Japan, European, Brands, Global (Long Only) and Technology Funds significantly outperformed their benchmarks in calendar year 2022 Performance of Platinum Trust Funds A$ 1 Year 5 Year 10 Year Since inception FUM At 31 December 20
Slide 32: Appendix 8: Platinum International Fund…we’ve been here before
Appendix 8: Platinum International Fund…we’ve been here before Investment performance: bull & bear market view since inception to 31 December 2022 Platinum International Fund Fund performance vs MSCI AC World Net Index ($A), MSCI AC World Net index ($A) Cumulative and by market trend since inception
Slide 33: Disclaimer
Disclaimer This presentation has been prepared by Platinum Asset Management Limited ABN 13 050 064 287 (“PTM”). References in this presentation to “Platinum” are to Platinum Investment Management Limited ABN 25 063 565 006, AFSL 221935, unless otherwise expressly stated. While the information in thi