Slide 1: Half Year Results - 31 December 2010 Media Release
Wednesday, 23 February 2011 HALF YEAR RESULTS - 31 December 2010 Highlights • Funds under management up 7% at $15.5 billion (for the 12 months) with new inflows into boutiques • Normalised net profit maintained and expenses reduced • Interim dividend increased from 12 to 14 cents – rise of 17% • TRG
Slide 2: Half Year Results Overview
Wednesday 23 February 2011 TREASURY GROUP LIMITED HALF YEAR RESULTS – 31 DECEMBER 2010 Overview Treasury Group (ASX:TRG) today announced a profit of $5.23 million for the half year ended 31 December 2010, from $6.42 million reported at the previous corresponding year's equivalent result. The 2009 re
Slide 3: Chairman's comments and FUM by manager
Treasury Group Chairman, Mike Fitzpatrick said: “We have made pleasing progress with growth in funds at our new boutiques and continued growth at RARE. The last six months has also seen the recruitment of outstanding talented senior resources at TAAM, GVI and Orion and continued successful integrati
Slide 4: Comment on current market conditions
Comment on current market conditions Our results were flat over the quarter following the strong recovery in normalised profitability in 2010/09 financial year. Half year earnings growth was impacted by sideways trading equity markets over the year, moderate investment flows and some further outflow
Slide 5: For further information
For further information Mr Mark Burgess Mr Joseph Ferragina Managing Director Chief Financial Officer +61 28243 0400 +61 28243 0400 Notes: Treasury Group equity accounts all the fund management businesses. The ownership interest in the asset managers is as follows: Investors Mutual Limited 47.50% Or
Slide 6: Detailed Financial Analysis
Detailed Financial Analysis Below we offer more detail on our financial results including: Normalised Earnings Share of net profit from equity accounted investments Cash flow Tax policy Dividend Detailed disclosure of business profit and loss Treasury Group income statement Aggregate
Slide 7: Cash Flow
Cash Flow The cash flows of the group were steady for the six months ended 31 December 2010. Net cash flows from operating activities were up 17% primarily due to the timing of fees received and paid to fund managers within the Group. TRG invested $3 million in new investment products of managers as
Slide 8: Aggregation of Funds Management Businesses
Aggregation of Funds Management Businesses The table below is an aggregation of the profit and loss of each company that is reflected as an associate namely IML, Orion, TAAM, RARE, GVI, Cannae, AR Capital and Celeste Funds Management. This aggregated information is provided to offer further insigh
Slide 9: Review of operations: Treasury Group Investment Services
Review of operations: Treasury Group Investment Services (TIS) - (100% owned at 31 December 2010) Treasury Group through TIS provides its managers with risk and compliance services as well as a Responsible Entity function. TIS are focused solely on supporting our internal managers and offers a high
Slide 10: Review of operations: TAAM and RARE
We are hopeful that confidence will return as investment markets rally and we look forward to working with GVI to achieve net new funds flow. Treasury Asia Asset Management (TAAM) - (40% owned at 31 December 2010) During the half year TAAM saw three institutional clients withdraw from their funds pr
Slide 11: Treasury Group Limited Half year results to December 2010
Treasury Group Limited Half year results to 31 December 2010 Presented by Mark Burgess, Managing Director Joe Ferragina, Chief Financial Officer
Slide 12: A Summary of the profit and loss
A Summary of the profit and loss 6 months to 31 December 2010 $000 2010 2009 % Change Total revenue 2,234 2,834 (21) Equity q y share of associates 7,302 , 7,404 , ((1)) Expenses (4,304) (4,681) (8) Net profit after tax (TRG shareholders) 5,232 6,421 (19) NORMALISED NET PROFIT 5,232 5,400 (3) Basic
Slide 13: Comment on results
Comment on results • New fund flows up over 12 months • Net N t new inflows i fl att RARE and d Trilogy T il • New managers (Celeste, Aubrey and AR Capital) saw net inflows over the 12 months • Retail market confidence soft • Outflows at IML, despite strong relative performance • TAAM saw fund outfl
Slide 14: Dividend policy
Dividend policy • Dividend policy – growth in dividend reflects Board’s Board s confidence in underlying business • Dividend increased from 12 to 14 cents (PCP) for the half. Rise of 17% over the year • Opportunities continue to exist for new boutiques • Capital also utilised in developing new produ
Slide 15: Funds Under Management (FUM)
Funds Under Management (FUM) • TRG has well diversified fund base FUM at 31st December 2010 • Profits sourced from diversified base AUBREY AR CAPITAL 2% CELESTE • Reduces individual business risk 1% 3% • Allows multiple sources for future growth IML 18% TRILOGY • Growth in international clients 15%
Slide 16: FUM - all managers June 2002 to December 2010
FUM 18 All managers associated with Treasury Group June 2002 to December 2010 16 14 12 $billions 10 8 6 4 2 0 6
Slide 17: FUM by region, retail, distribution
FUM by region, region retail retail, distribution FUM by Region Segment ($millions) 31 December 2010 30 June 2010 31 December 2009 Australian Equities 8,538.5 8,239.3 9,043.3 International Equities 3,973.8 3,797.2 3,807.8 Alternatives 3,001.3 2,2671.1 1,619.2 TOTAL 15,513.6 14,707.6 14,464.3 Clients
Slide 18: Treasury Group evolution continues
Treasury Group evolution continues US Pension Funds Cayman Island Funds Dublin 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
Slide 19: Key developments over the half to December
Key developments over the half to December • Launch of new products • Aubreyy Global Growth Fund,, European p Growth Fund– UCITs III • Cayman Island – AR Capital scheduled to launch in March quarter 2011 • Australian pooled fund – Aubrey Global Growth Fund • GVI unhedged product • Offers clients i
Slide 20: Key developments over 12 months
Key developments over 12 months • IML – strong performance against value based competitors g of two teams p • Merger performingg well • A deeper and more experienced team than most in the market • Seeing increasing institutional interest • Retail funds flow – targeting researcher and consultant re
Slide 21: Manager Review
Manager Review • Aubrey Capital Management (Aubrey) • Aubreyy began g operations p in 2006 • Staffed by experience principals – • ex Walter Scott/Stewart Ivory/First State • Edinburgh based • Growth style investing – offer Global and European funds • Partnered with TRG in 2009 • Funds flow • Seeing
Slide 22: Associate Review
Associate Review • Premium Investors Limited (PRV) • Listed investment company • Invested in Australian and international equities • Allows investors access to Treasury Group managers Year to: Dividend Dividend yield – Fully paid on average share Franked • Delivered strong results for investors in 2
Slide 23: Market Overview
Market Overview • Investor confidence in the retail market remains mixed • Markets M k t flat fl t over the th 12 months th • Signs of some improvement in sentiment • Researcher driven market with platforms dominating new flows – our managers focus on researcher ratings • S Some f competition fee ti
Slide 24: Manager Snapshot
Manager Snapshot International Manager Investment Style Joined Vehicles Available* Location TRG Treasury Asia Asset Management High Alpha Asian Equities 2005 Pooled Fund, Mandate, Singapore (TAAM) UCITS Global Value Investors (GVI) Defensive Value Global 2005 Pooled Fund, Mandate Sydney Equity Aubre
Slide 25: Summary
Summary • We continue to be approached by high quality investment partners • Underlying net funds flow positive but mixed in the half • Earnings flat on the half as investment markets range trade – diversified source of earnings • TRG has outstanding client base in Australia and offshore • Future gr
Slide 26: Appendix
Appendix |Treasury Group Ltd
Slide 27: Managing the boutiques life cycle
Managing the boutiques life cycle •Transitions to next phase of growth •Succession planning in place •Maintains boutique culture Early development Gro th Growth S ccession Succession • Assets and profitability • Firm can become • Team requires support grow bureaucratic • Gaining traction with • Need
Slide 28: Disclaimer
Disclaimer The information in this presentation is general background information about Treasury Group Limited and is current only at the date of this presentation. In particular, this presentation: • is not an offer or recommendation to purchase or subscribe for securities in Treasury Group Limited