FY24 Annual Report

Perpetual Group Annual Report 2024

Perpetual Limited (Perpetual) is an ASX-listed company (ASX: PPT) headquartered in Sydney, Australia, providing asset management, wealth management and corporate trustee services to local and international clients.

Reporting suite

Perpetual Group1 presents its 2024 Annual Reporting suite for the year ended 30 June 2024.

Visit perpetual.com.au/shareholders/reports-and-presentationsfor more.

Corporate

Annual Governance

Report Statement

Acknowledgement of Country

Perpetual acknowledges Aboriginal and Torres Strait Islander peoples of this nation. We acknowledge the Traditional Custodians of the lands on which our company is located and where we conduct our business. We pay our respects to ancestors and Elders, past and present. Perpetual is committed to honouring Aboriginal and Torres Strait Islander peoples' unique cultural and spiritual relationships to the land, waters and seas and their rich contribution to society.

Perpetual Group

Since our establishment as a trustee company in 1886,

Perpetual has continually evolved to meet the needs of our clients,

the communities we serve, and after listing on the Australian Stock Exchange in 1964, our shareholders.

In May 2024, following the completion of a comprehensive Strategic Review, the Perpetual Board announced, subject to shareholder, court and regulatory approvals, Kohlberg Kravis Roberts

• Co (together with its affiliates, KKR), a US-based global private investment firm, will acquire 100% of Perpetual's Corporate Trust and Wealth Management businesses for $2.175 billion.

Consequently, subject to the satisfaction of those conditions, Perpetual Asset Management will become a simplified, stronger, standalone ASX-listed business with $215 billion in assets under management, with boutique brands operating in key markets across the globe.

Perpetual shareholders will benefit not only from the short-term cash

returns following the sale of Wealth Management and Corporate Trust to KKR, but also longer-term opportunities by retaining ownership and sharing in the performance of a global, multi-boutique asset management business.

The Board is confident that retaining ownership of our Asset Management business will unlock improved returns to shareholders over the long term.

As Chairman and on behalf of the Board, I'd like to thank you,

our shareholders, for your continued support.

Tony D'Aloisio AM

Chairman

About Perpetual Group Directors' Report Operating and Financial Review Financial Report

Perpetual Group Annual Report 2024

About Perpetual Group

Today, Perpetual Group provides asset management, private wealth and trustee services to local and international clients. Our clients include Australian and international institutions, not-for-profit organisations, private businesses, financial advisers, individuals and families.

Asset Management

A global, multi-boutique Asset Management business that provides an extensive range of specialist investment capabilities through its boutique businesses across key regions globally. Our investment capabilities include global, emerging markets, UK, US, European, Asian and Australian equity strategies, as well as fixed income, multi-asset, cash and sustainable investment strategies.

Our seven boutique brands include Perpetual Asset Management, Pendal Asset Management, Barrow Hanley Global Investors (Barrow Hanley), J O Hambro Capital Management (J O Hambro), Regnan, Trillium Asset Management (Trillium), and Thompson, Siegel and Walmsley (TSW).

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Financial Highlights

Operating revenue2Underlying profit after tax

1. Excludes income from structured investments.
2. Excludes income from structured investments, transaction and integration costs and unrealised gains/losses on financial assets.
3. EBITDA represents earnings before interest, taxation, depreciation, amortisation of intangible assets, equity remuneration expense and significant items.
4. June 2020 figure re-presented based on the revised definition of UPAT. Figures prior to June 2020 have not been re-presented.
5. Excludes significant items.
6. Attributable to equity holders of Perpetual Limited.
7. Diluted earnings per share calculated using the weighted average number of ordinary shares and potential ordinary shares on issue.
8. Calculated using UPAT.
9. Calculated using NPAT.
10. Dividends declared with respect to the financial year.
11. June 2021 and June 2020 figures have been restated for the change in accounting policy relating to Software-as-a-Service (SaaS) arrangements.
12. June 2024 and June 2023 figures have been restated following the completion of Purchase Price Allocation (PPA) of Pendal Group.
13. Represents 30 June closing balances.
14. Formerly Perpetual Asset Management Australia and Perpetual Asset Management International.
15. Formerly Perpetual Private.
16. Formerly Perpetual Corporate Trust.
17. Includes ordinary shares and potential ordinary shares. The weighted average number of ordinary shares for the June 2021 and June 2020 period were adjusted retrospectively in accordance with AASB 133 Earnings per Share following the issues of new shares at a discount to market value during the period.

About Perpetual Group Directors' Report Operating and Financial Review Financial Report

Perpetual Group Annual Report 2024

Chairman's Report

Perpetual's transformation strategy has created a global asset

management business with assets under management of $215.0 billion1. Today, the business benefits from scale and diversification across seven brands, with more than 100 investment strategies in 10 countries, and is better able to serve clients' growing demand for global investment solutions through a global distribution capability.

Chairman's Report

About Perpetual

The continued overall growth in AUM in the 2024 financial year, which increased from $212.1 billion to $215.0 billion, despite the net outflows we reported, highlights the benefits of our model and exposure to a range of equity and bond markets, regions and currencies, as well as client channels. While the Board acknowledges that there is still work to do to maximise the value of Perpetual's more recent acquisitions, particularly Pendal Group, we are confident that the strength of the brands, together with their exceptional investment teams, will underpin long-term growth for our Asset Management business.

Importantly, the Scheme is subject to a shareholder vote. The Board unanimously recommends this transaction to shareholders, subject to there being no superior proposal and an Independent Expert concluding, and continuing to conclude, that the Scheme is in the best interest of Perpetual shareholders. Subject to the same qualifications, each Perpetual Director intends to vote, or cause to be voted, all of the Perpetual shares they own or control in favour of the Scheme. Shareholders do not need to take any action at this stage. A Scheme Booklet will be sent to shareholders ahead of the Scheme meeting which will contain more detail regarding the transaction. More detail on the background and rationale for Strategic Review and an overview of the Scheme can be found on page 8 of this Annual Report.

Leadership changes

On 21 August 2024, Perpetual announced that it had appointed Bernard Reilly to succeed Rob Adams as Chief Executive Officer (CEO) and Managing Director of Perpetual Group.

Mr Reilly has more than 30 years' experience in international and domestic asset management, banking and finance sectors. He was formerly CEO of Australian Retirement Trust, the $300 billion superfund formed in February 2022 through the merger of Sunsuper and QSuper.

Mr Reilly commenced on 2 September 2024, joining in what is a critical period for Perpetual, particularly in driving a new strategy to improve the performance in our Asset Management business.

The Board is extremely appreciative of Rob's tenure and the contribution he has made to the Group since he joined in September 2018, and we wish him the very best for the future.

Board changes

Since the Pendal acquisition, the Board has expanded to include nine directors, each with a specific skill set and strength to support and grow our three businesses.

During the year, offshore Non-executive Director,

Kathryn Matthews, who joined from Pendal and committed to the first 12 months on the Board following the acquisition, was replaced by Phil Wagstaff as a Non-executive Director of the Board. Phil brings a deep understanding of the asset management sector, having served in several executive roles in large global asset management businesses over a 35-year period in the industry. We are pleased that Phil has joined the Board, where he is already contributing positively, and thank Kathryn for her contribution through a critical period as we integrated Pendal into our business.

In May 2024, we announced the appointment of Non-executive Director, Gregory Cooper as Deputy Chairman, focused on assisting the Board in ensuring the Asset Management business is well positioned to transition to operate as a standalone entity.

Most recently, we also announced future Board changes in anticipation of the completion of the transaction and transition to a standalone asset management business.

As this is my last term as Chairman, it is appropriate for me to retire on the completion of the transaction in early 2025 and for our Deputy Chairman, Gregory Cooper, to assume the role of Chairman following the implementation of the transaction. Gregory is particularly well qualified to Chair Perpetual.

Long-standingNon-executive Directors Ian Hammond and Nancy Fox AM will retire at the Annual General Meeting (AGM) on 17 October 2024 in accordance with Perpetual's Board rotation policy. Ian and Nancy have been on the Board since 2015 and Chair the Audit, Risk & Compliance Committee (ARCC) and the People & Remuneration Committee (PARC), respectively.

Fiona Trafford-Walker will assume the role of Chair of the PARC following Nancy's retirement at the AGM and at the time of writing this letter, we are in the final stages of the recruitment for Mr Hammond's replacement which will be announced prior to the AGM.

I would like to thank both Nancy and Ian for their input, counsel, guidance and contributions over what has been a significant period of change for Perpetual.

Sustainability

In FY24, we made progress in the delivery of our sustainability strategy, Perpetual's Prosperity Plan, launched in 2022, which includes commitments across four key pillars: Governance, Planet, People and Communities. More information on our commitments can be found on page 16 of this report as well as in our FY24 Sustainability Report.

Conclusion

On behalf of the Board, I would like to acknowledge and thank our people for their continued dedication and hard work in what has been a transformational year for the Group. In particular, I would like to thank our many teams who have worked through an intense period of change and continue to contribute to building a strong, successful business.

Finally, I would also like to thank you, our shareholders, for your continued support through another significant year for Perpetual Group.

Group Directors' Report Operating and Financial Review Financial Report

CEO's Report

About Perpetual

In our Wealth Management business, we continued

to perform well in both market and non-market related sectors, with $200 million in positive net inflows over the financial year. Most significantly, our non-market related business demonstrated pleasing performance, with our Fordham business recording its highest year of revenue since it was acquired in 2009. This growth was sustained by our increased investment in staff and technology in earlier periods shaping a strong foundation to capitalise on potential growth prospects. Market-related revenue also performed well, driven by stronger markets and positive inflows.

In Corporate Trust, the business continued to grow FUA, by approximately 4% in FY24, and grow revenue, which included growth across all three of its business lines, while also investing in upgrading legacy systems to support more efficient processing of client payments and registry services.

Our Managed Fund Services division, within Corporate Trust, had another strong year in Australia, improving revenue by 8% to $83.9 million, supported by continued market activity in the commercial property segment, despite higher interest rates. Additionally, following a period of further investment and new digital product and service launches during the year, Perpetual Digital grew revenues by 9% and is now generating approximately 14% of Corporate Trust's revenue.

Progress on Perpetual's Prosperity Plan

Perpetual has made considerable progress on delivering our sustainability commitments, despite a significant period of change for our business.

Of our 35 commitments, 26 are either on track or achieved across our four key pillars - Governance, Planet, People and Communities.

In our Asset Management business, as of 30 June 2024,

$16.9 billion of our AUM was in funds with an ESG, sustainability or impact label in their product name, or where sustainability is mentioned in the investment objective of the fund or

is a stated client intent in the schedule of an Investment Management Account.

I joined Perpetual in 2018 with a clear mandate to build scale, including through inorganic growth across our three businesses with a particular focus on our Asset Management business which, at the time had $30.2 billion in AUM2 and was overwhelmingly weighted towards Australian assets, specifically Australian equities, and clients. In Asset Management, through the acquisitions of Trillium, Barrow Hanley and more recently Pendal Group, we now manage $215.03 billion in AUM for retail and institutional clients around the world, we have global scale, and we offer a much more diverse portfolio across our boutique brands.

In Wealth Management, we have driven growth organically, supported by our successful acquisitions of Priority Life in 2019 and Jacaranda Financial Planning in 2021. Both acquisitions addressed gaps in our advisory channels following the aftermath of the Royal Commission and when bolstered

by our advisor growth strategy over 2019 to 2021, successfully supported an increase in internal advisor numbers to deliver over $1 billion in new funds under advice.

In Corporate Trust, we invested in a multi-year project to replace our legacy systems and improve our service offerings as well as our digital capabilities, which, following the acquisition of Laminar Capital, we have expanded to provide solutions to a broader range of our clients. Since FY18, our FUA has grown from $0.69 trillion to $1.2 trillion in FY24.

Following completion of KKR's acquisition of Wealth Management and Corporate Trust4, Perpetual will be ready for its next phase as a multi-boutique, global asset management business, with a strong balance sheet, and a substantial capacity for future growth from its global footprint, covering all key markets and channels.

Group Directors' Report Operating and Financial Review Financial Report

4. The Scheme of Arrangement for the proposed transaction is subject to both a shareholder vote which is anticipated to occur in early 2025 and satisfaction of other customary conditions precedent including court and regulatory approvals.

7

Group Annual Report 2024

Background and rationale for Strategic Review

and overview of Scheme of Arrangement

Perpetual

An overview of the transaction

In May 2024, Perpetual announced the completion of

a comprehensive Strategic Review to unlock shareholder value and take further steps to deliver sustainable growth and returns for shareholders.

In doing so, Perpetual entered into a binding Scheme Implementation Deed with KKR, a global private investment firm, who will acquire 100% of the Corporate Trust and Wealth Management businesses for an enterprise value of $2.175 billion via a Scheme. Implementation will be subject to shareholder and court approval as well as regulatory and other conditions being satisfied.

The effect of this transaction will be to realise cash returns to shareholders from our investments and create a simplified, streamlined, debt-freeASX-listed global asset management company of scale, with exceptional investment professionals as well as strong geographic and product diversification. This business will be better placed to meet clients' investment needs and more effectively compete

with global asset managers.

The Board determined that the value offered by separating the Group's high-quality businesses was greater than

the value the market had placed on the company as a conglomerate entity. The $2.175 billion offer price for the Scheme represents an attractive valuation of 13.7x the last 12-month EBITDA1 for the Wealth Management and Corporate Trust businesses, and is higher than any former proposals received that were informed by customary due diligence and consideration.

The Scheme will deliver both short-term returns to shareholders via a cash return as well as the continued ownership of an asset management business that has potential to better drive benefits from being a standalone business with scale.

A strategy that has supported growth across all three of Perpetual's businesses - See Figure 1

Perpetual's transformation strategy, first announced in 2018, has created a global Asset Management business with AUM of $215.0 billion2. Today, the business benefits from scale and diversification across seven brands, with more than

100 investment strategies across key regions globally, and is better able to serve clients' growing demand for global investment solutions through a global distribution capability.

The transformation strategy was required in order to address the declining competitive position of the Asset Management business. This was coupled with the need for Perpetual

to make significant additional investments in both the Corporate Trust and Wealth Management businesses which we have been able to capture in the sale to KKR.

The acquisitions of Trillium, Barrow Hanley and Pendal Group have added scale, as well as new and diversified investment capabilities. These have significantly offset Perpetual's prior reliance on Australian equities, an asset class that

has faced, and is expected to continue to face, sector-wide pressures, even in the face of strong investment performance by local teams.

Our Wealth Management business has grown in both FUA and profits before tax by 34% and 31% respectively between FY19 and FY24 via our organic advisor growth strategy, coupled with our acquisition of advisory firms Priority Life and Jacaranda Financial Planning. This strategic planning and growth model allowed the business to navigate structural headwinds including the Royal Commission in early 2019.

Finally, our Corporate Trust business has completed a digital transformation. Following the acquisition of Laminar Capital in 2021, Perpetual launched Perpetual Digital to assist the business and its clients to move away from legacy technologies and onto a cloud-based, scalable platform. The technological developments the business has achieved over the last five years have contributed positively to Corporate Trust's FUA and profit before tax by 58% and 78% respectively.

2009

Wealth Management acquires Fordham and Grosvenor Financial Services

2013-14

Perpetual acquires The Trust Company and launches its first listed investment company - Perpetual Equity Investment Company Limited

2016

Wealth Management acquires Fintuition Medical Advisory

2018

Corporate Trust acquires RFi Roundtables

2020

Wealth Management launches Adviser Growth Strategy, increasing adviser numbers by 36% over 24 months

Perpetual acquires Trillium and launches two ESG funds in Australia

Perpetual acquires a 75% interest in Barrow Hanley, adding 32 new investment capabilities, and providing diversification benefits and growth potential