Perpetual Limited · ASX:PPT
Perpetual — Perpetual Credit Income Trust — Investment insights webinar (May 2022)
12 slides from Perpetual's conference presentation, May 19, 2022
Slide 1: Perpetual Credit Income Trust Investment insights webinar
PERPETUAL CREDIT INCOME TRUST Investment insights webinar The end of the four decade bond bull market – and where to invest now that interest rates are rising 19 May 2022
Slide 2: Important Note
IMPORTANT NOTE This presentation has been prepared and authorised for release by Perpetual Investment Management Limited ABN 18 000 866 535, AFSL 234426 (PIML), as the investment manager for Perpetual Credit Income Trust (PCI). Perpetual Trust Services Limited ABN 48 000 142 049 AFSL 236648 (PTSL) i
Slide 3: Presenters
PRESENTERS Karen Trau Michael Korber Michael Murphy Investor Relations, Perpetual Managing Director, Credit and High Yield Analyst Credit Income Trust Fixed Income Portfolio Manager, Perpetual Credit Income Trust 3
Slide 4: The Four Decade Bond Bull Market Ending?
THE FOUR DECADE BOND BULL MARKET ENDING? US Treasury Yield since 1981 peak 16 • Our thoughts on the market: 14 o Inflation has really taken a grip of markets through 12 the pandemic 10 o Whilst some is transitory we are cognisant of some 8 structurally higher inflation due to de-carbonisation, Yield
Slide 5: What We Are Seeing in the Market
WHAT WE ARE SEEING IN THE MARKET Our outlook on credit markets is slightly negative: • Key headwinds for markets – slowing economic Security / indices Yield (%)* growth, elevated inflation and accelerating monetary tightening Australia Benchmark Bond - 10 Year 3.54 • With much uncertainty ahead, inv
Slide 6: How We Are Positioned in This Environment
HOW WE ARE POSITIONED IN THIS ENVIRONMENT • We believe floating rate exposures can provide better protection against inflation than fixed Rising inflation and potential for rate assets. further interest rate increases • PCI is likely to benefit from rising interest rates as the interest payment rece
Slide 7: Portfolio Composition
PORTFOLIO COMPOSITION AS AT 30 APRIL 2022 Breakdown by credit rating Breakdown by currency Breakdown by seniority 3.4% 8.5% 7.7% 3.8% 7.7% 0.3% 9.1% 29.7% 26.8% 40.7% 64.8% 82.9% 14.8% Senior debt AA and above A BBB BB+ and lower Unrated Cash Subordinated debt AUD USD EUR Cash Deeply subordinated de
Slide 8: Portfolio Composition
PORTFOLIO COMPOSITION AS AT 30 APRIL 2022 Sector allocation Breakdown by corporate sector Airlines, 1.61% Chemicals, 1.12% Commercial Services, 3.07% 0.9% 1.5% Consumer Products, 2.76% 1.9% Consumer Services, 2.83% 2.0% 6.7% Educational Services, 3.00% Exploration & Production, 1.59% 7.2% Financial
Slide 9: Case Study – SCF Group
CASE STUDY – SCF GROUP HIGH YIELD DEBT EXAMPLE • SCF Group engages in the handling of containers through a network of depots across Australia. Revenue is primarily generated on a contracted lease basis and their fleet of containers are designed specifically for the required application of the end us
Slide 10: Perpetual Credit Income Trust (ASX: PCI) Distribution and Performance
PERPETUAL CREDIT INCOME TRUST (ASX: PCI) DISTRIBUTION Annual distribution return was 3.7% which is above PCI’s target return of RBA Cash Rate + 3.25% (net of fees) through the economic cycle^. JUL AUG SEP OCT NOV DEC JAN FEB MAR APR MAY JUN FYTD FY2020 0.40 0.40 0.39 0.37 0.36 0.37 0.37 0.35 0.33 0.
Slide 11: The Investment Opportunity with Perpetual Credit Income Trust
THE INVESTMENT OPPORTUNITY WITH PERPETUAL CREDIT INCOME TRUST (ASX: PCI) MONTHLY INCOME DIVERSIFICATION PCI targets a total return of RBA Cash Rate plus Typically 50 – 100 assets in the portfolio across 3.25% (net of fees) through the economic cycle1. the broad spectrum of credit and fixed income It
Slide 12: Q&A
Q&A Perpenayp
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