Schroder Real Estate Investment Trust Ltd · LSE:SREI
Schroder Real Estate Investment Trust — Schroder BSC Social Impact Trust — FY2024 Earnings Presentation
41 slides from Schroder Real Estate Investment Trust's earnings presentation, October 2024
Slide 1: Schroder BSC Social Impact Trust Final results webinar
Schroder BSC Social Impact Trust Investing to address UK social challenges Final results webinar For the year ended 30 June 2024 October 2024 Jeremy Rogers Hermina Popa Image from AllChild, a charity which supports children to build the skills they need to flourish. Marketing material.
Slide 2: Investor Information
Schroder BSC Social Impact Trust – Investor Information Type This is a closed ended investment trust. Investment Objective The Company's principal investment objectives are to deliver measurable positive social impact as well as long term capital growth, through investing in a diversified portfolio
Slide 3: Fund Risk Considerations
Schroder BSC Social Impact Trust plc – Fund Risk Considerations • Concentration risk: The Company may be concentrated in a limited number of geographical regions, industry sectors, markets and/or individual positions. This may result in large changes in the value of the company, both up or down. • L
Slide 4: Schroder BSC Social Impact Trust
Schroder BSC Social Committed £86m to over 190 UK Impact Trust social organisations Provides capital to 400,000 social enterprises and People reached charities addressing some of the UK’s biggest social 35,000 people provided affordable challenges and decent housing Image from Uxbridge United Welfar
Slide 5: Full Year Highlights (to 30 June 2024)
Full Year Highlights (to 30 June 2024) Continued to tackle poverty and inequality while delivering positive NAV total returns Financial Operational Outlook Exciting pipeline of investment Continued strong impact opportunities +1.5% NAV total return per share performance 2.94p dividend per share decl
Slide 6: Performance and Portfolio Update
Performance and Portfolio Update Image from Hull Women's Network, which houses women and their children escaping domestic violence in Hull.
Slide 7: A resilient financial performance against a challenging backdrop
A resilient financial performance against a challenging backdrop Invested % of NAV, 30 June 2024 Net Asset Value (‘NAV’) Share price total total return per share return High Impact Housing Debt and Equity for Social Enterprises Social Outcomes Contracts Liquidity Assets 12 months ended 30 June 2024
Slide 8: NAV/share broadly stable
NAV/share broadly stable Investment income offset by valuation changes and dividend Performance Drivers . . • Income and capital gains in . Social Outcomes Contracts . portfolio . . . . • Ramp up of returns in the . . Impact Housing Portfolio, . . particularly the Real Lettings . . Property Fund . •
Slide 9: Declared dividend increased by 28%
Declared dividend increased by 28% At the high end of our guided dividend range of 2-3% yield on NAV p.a. 2.94 3 3.00% Upgraded 2.3 dividend 2.5 2.50% Annualised dividend yield (%) guidance Dividend per share (p) 2 2.00% 1.5 1.3 1.50% IPO dividend 1.08 guidance 1 1.00% 0.5 0.50% 0 0.00% 30 June 2021
Slide 10: High Impact Portfolio has generated a resilient performance
High Impact Portfolio has generated a resilient performance Contribution to SBSI total Value IRR since High Impact Portfolio Value as % of NAV TVPI1 DPI1 return (last 12 months) (pps) inception* Charity Bond Portfolio 17% 0.34 1.12 0.29 Bridges Evergreen Holdings 13% - 1.00 1.23 0.13 Debt & Equity C
Slide 11: Continuing to operate a seasoned, highly diversified portfolio
Continuing to operate a seasoned, highly diversified portfolio Asset allocation Vintage Phase Access 8% 14% 29% 32% 37% 17% 48% 22% 48% 67% 5… 43% High impact housing 2013-2016 Mature Co-investments/secondaries Debt and Equity for Social 2017-2019 Investment Private funds closed to new investors Ent
Slide 12: Our investments are transforming the lives of the UK's most vulnerable people
Reaching deeply into Our investments are transforming the local communities to deliver impact to all lives of the UK’s most vulnerable people corners of the UK Generating social impact across 4 key life-changing themes 400,000 Reducing poverty Good health people positively impacted since launch and
Slide 13: Case Study: Delivering NHS cost savings
Case Study Delivering NHS cost savings through early intervention for Intervention: Social Prescribing 3,000+ the long term NEL people supported unwell Fund: Bridges SOF II
Slide 14: Q&A
Q&A Image from AllChild, a charity which supports children to build the skills they need to flourish.
Slide 15: The UK faces entrenched social issues and significant investment gaps
The UK faces entrenched social issues and significant investment gaps The challenge The investment gap 309,000 c.£17bn investment a year required for people homeless in England the next decade to tackle housing (inc. 140,000 children)¹ shortage² £65bn >3m needed to insulate homes by people living in
Slide 16: How our social impact investments deliver long-term financial value
How our social impact investments deliver long-term financial value Delivers government Prevention savings e.g. a social enterprise We target areas charity delivering cost- that effective care in the community saves future governments NHS spend historically underinvest in Generates reliable Infrastr
Slide 17: Investments at the intersection of high social impact and strong risk adjusted returns
We look for investments that sit at the intersection of high social impact and strong risk adjusted returns Our sweet Investments generating robust spot Investments generating significant returns and mitigating financial risk positive social impact Focus on historically resilient cash flows, high qu
Slide 18: Our asset classes: proven investment models, high impact & complementary
Our asset classes: proven investment models, high impact & complementary Debt and equity for High impact housing Social outcomes contracts social enterprises A model where private capital enables Secured lending, charity bonds and Providing social and affordable housing expert charities and social e
Slide 19: With resilient and differentiated revenue streams
With resilient and differentiated revenue streams Debt and equity for High impact housing Social outcomes contracts social enterprises – c.70% underpinned by government- – c.30% inflation linkage – Outcomes-based revenue streams backed revenue streams – Very low correlation between rents and from Go
Slide 20: Diversified portfolio combining high impact and investment returns
We select investments to deliver a diversified portfolio combining high impact and investment returns Enterprises or …i f u …whi h m u … d d by We invest in: funds generating positive social chosen asset portfolio return great teams … and risk imp … requirements... 1. Leading fund managers with deep
Slide 21: Access matters: We source investments from our proprietary network of experts
Access matters: We source investments from our proprietary network of experts Shared characteristics of our managers 500+ 130+ 3500+ Social impact Fund, manager & – Deep local knowledge High impact investments social bank reviewed by BSC investments made by enterprises invested – Deep sector knowled
Slide 22: Investments supporting over 190 frontline social enterprises
Investments supporting over 190 frontline social enterprises to deliver their valuable services Reducing poverty Good health and Education, training, Just transition to and inequality Wellbeing decent work net zero 25 years average track record Debt and equity for social * enterprises High impact ho
Slide 23: Case Study: Safe move-on homes and support for women and children
Case Study Providing safe move-on homes and support for women and children Intervention: Thrive Women’s 20 impacted by Aid properties domestic abuse Fund: Social & Sustainable
Slide 24: The market is scaling fast, with structural tailwinds
The market is scaling fast, with structural tailwinds set to drive further growth Over 12x growth in the social impact investment What is driving market growth? market1 – Proven track records of returns generation £10bn – Government focus – A growing volume of private capital – Differentiated growth
Slide 25: Government policy priorities align with social impact, as issues worsen
Government policy priorities align with social impact, as issues worsen Social challenges escalating “When we talk about rebuilding the country, The proportion of people this is a space that has “We heard from our experiencing food insecurity rose so much to offer” from 8% to 11% in 2022-23 Prime Mi
Slide 26: Why invest in the Schroder BSC Social Impact Trust?
Why invest in the Schroder BSC Social Impact Trust? A compelling investment proposition… …at an exciting time Create positive social Unique opportunity to An increasingly mature Growing Government outcomes that access diverse UK social portfolio set up to interest in crowding in transform impact the
Slide 27: Thank you
Thank you Image from AllChild, a charity which supports children to build the skills they need to flourish. Marketing material.
Slide 28: Important information
Important information This presentation has been prepared by Schroder Unit Trusts Limited ('Schroders'), which is authorised and regulated by the United Kingdom Financial Conduct Authority, for information and discussion purposes only. The information in this presentation has not been fully verified
Slide 29: Fund Risk Considerations
Schroder BSC Social Impact Trust plc – Fund Risk Considerations • Concentration risk: The Company may be concentrated in a limited number of geographical regions, industry sectors, markets and/or individual positions. This may result in large changes in the value of the company, both up or down. • L
Slide 30: Portfolio management by social impact expert Better Society Capital
Portfolio management by social impact expert Better Society Capital Better Society Capital (BSC) BSC provides Alternative Investment Fund Manager – Leading UK social impact investor – Unique positioning in social impact investment Schroders – Developing the UK social impact investment market develop
Slide 31: Our board
Our board Susannah Nicklin Michael Balfour James B. Broderick Alice Chapple Independent Non-Executive Chair Independent Non-Executive Director and Independent Non-Executive Director and Independent Non-Executive Director, Chair Chairman of Audit and Risk Committee Chair of Management Engagement of N
Slide 32: Better Society Capital: Over a decade leading the impact market
Better Society Capital: Over a decade leading the impact market 2012 2013 2014 2015 BSC launches Outcomes Matrix BSC launches inaugural Impact BSC establishes UK National BSC is a founding for impact measurement – now at Tests for considering impact Advisory Board on Impact member of Impact >[30,000
Slide 33: Our investment process
Our investment process Financial drivers and risk mitigation Impact return and risk mitigation What: Significant needs – housing, health, Historic revenue stability, high weighting social care of government sources Who: Vulnerable and disadvantaged groups Delivering significant savings for Sweet gov
Slide 34: How we can partner with you on impact investment
How we can partner with you on impact investment Great impact stories to tell – whatever the size of your investment Access to impact experts and industry-leading resources We can provide comprehensive impact practice training, participation in Providing what you need, when you need it, including th
Slide 35: Case study bank
Case study bank Case studies available showing impact across specific SDGs, social issues, themes and/or regions Enabling community ownership of seven solar assets, Developing affordable, zero-carbon housing for with surplus returns funding community orgs key workers £20m in community benefits 226 h
Slide 36: Portfolio holdings
Portfolio holdings Invested % Exposure1 Name Asset class Invested Investment focus Example revenue sources SDGS of NAV % of NAV Debt & equity for Charity Bond Portfolio £14.5m 16.8% 16.8% Bonds issued by charities G v’ i social enterprises Debt & equity for Bridges Evergreen Capital £11.5m 13.3% 13.
Slide 37: Seeking inflation resilient returns
Seeking inflation resilient returns 66% of invested capital aims to benefit from higher rates of inflation Exposure¹ as a % of NAV Invested as % of NAV 4% 38% 34% 43% 48% 5% 7% 13% 13% Housing and Renewables – mix of longer dated index linked leases, shorter property leases, Feed in Tariffs etc. Mez
Slide 38: Liquidity Asset Allocation
Liquidity Asset Allocation Past performance is not a guide to future performance and may not be repeated. The value of investments and the income Invested to mitigate cash drag during from them may go down as well as up and investors may not get back the amounts originally invested. investment perio
Slide 39: Financial Returns
Financial Returns Total returns for 12 months ending 30 June 2024 Past performance is not a guide to future performance and may not be repeated. The value of investments and the income from them may go down as well as up and investors may not get back the amounts originally invested. 30 June 2023 30
Slide 40: Performance definitions
Performance definitions Definitions Commitment (£m) Total commitment to the investment Value (£m) Current value of the drawn portion of the investment Exposure (£m) NAV of High Impact Portfolio plus undrawn commitments Distributions to date (£m) Capital and income distributions since investment Draw
Slide 41: References
References Slide 14 Slide 24 ¹ Shelter, 2023. At least 309,000 people homeless in England today. 1IFS, 2024. New statistics show large increases in material deprivation and food insecurity during https://england.shelter.org.uk/media/press_release/at_least_309000_people_homeless_i cost-of-living cris
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