Hansa Investment Company Ltd · LSE:HAN
Hansa Investment — Investor Presentation (April 2020)
63 slides from Hansa Investment's investor presentation, April 2020
Slide 1: Shareholder Presentation April 2020
Shareholder Presentation April 2020 1
Slide 2: Hansa Investment Company overview
Hansa Investment Company Limited is a proprietor based investment company blending best-in-class third party funds, a global equity portfolio and a strategic holding in Ocean Wilsons Holdings Managed by Hansa Capital Partners, the company adopts a long-term approach, ignoring short-term noise, with
Slide 3: Hansa timeline
Hansa Investment Company Limited Hansa timeline Rea Brothers acquire the management of a number of Finsbury Trust becomes invesment companies, including Hansa Trust Scottish & Mercantile Rea Brothers purchases Hansa Trust becomes 58% of Ocean Wilsons Hansa Investment Holdings Limited on behalf Compa
Slide 4: Corporate structure
Hansa Investment Company Limited Corporate structure Hansa Investment Company Limited 26.45% of OWHL is held by HICL 100% Ocean Wilsons Fund and Direct Holdings Limited Equity Holdings Managed by 100% Hansa Capital Partners LLP 58.17% of Wilson Sons is owned by OWHL Ocean Wilsons 41.83% (Investments
Slide 5: Strategic Review
Hansa Investment Company Limited Strategic Review 31st March 2020 Description Portfolio January 2014 Weight Core Regional Core Regional exposure based on the output 39.6% Description Portfolio of the Hansa House View. Weight UK Special situation UK equities 65% Thematic Thematic Growth sectors
Slide 6: Performance Review
Performance Review 6
Slide 7: Ranked Performance of Real Return by Major Asset Class
Hansa Investment Company Limited Ranked Performance of Real Return by Major Asset Class (in USD) Rank 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 1 U.S. Treasury MSCI EM REITS Inflation Bonds MSCI China Russell 2000 REITS MSCI Japan Russell 2000 MSCI China U.S. Treasury S&P 500 2 U.S
Slide 8: NAV, Share Price and KPI Performance
Hansa Investment Company Limited NAV, Share Price and KPI Performance Calendar YTD Financial Year 3 years to end 10 years to end 15 years to end end March 2020 2019/20 March 2020 (p.a.) March 2020 (p.a.) March 2020 (p.a.) NAV Performance TR -19.0% -16.7% -2.2% 3.8% 6.2% NAV Performance ex. OWHL TR -
Slide 9: Silo performance, 1 year to 31 March 2020
Hansa Investment Company Limited Gross time-weighted performance of the different silos 1 year to 31st March 2020 15.0% 9.9% 10.0% 4.7% 5.0% 1.8% 1.5% 0.0% -5.0% -2.1% -4.5% -10.0% -7.0% -15.0% -15.3% -16.7% -20.0% -25.0% -30.0% -35.0% -40.0% -39.1% Core Regional Thematic Global Equities Ocean Wilso
Slide 10: Silo performance, 3 years to 31 March 2020
Hansa Investment Company Limited Gross time-weighted performance of the different silos 3 years to 31st March 2020 35.0% 30.4% 30.0% 25.0% 20.0% 14.5% 15.0% 10.0% 8.5% 6.6% 6.7% 5.8% 5.8% 5.0% 0.0% -5.0% -2.7% -10.0% -6.8% -15.0% -20.0% -25.0% -25.6% -30.0% Core Regional Thematic Global Equities Oce
Slide 11: Contribution by holding, 1 year
£10,000,000 £- -£60,000,000 -£50,000,000 -£30,000,000 -£20,000,000 -£10,000,000 -£40,000,000 BlackRock Eur Hedge 1,813,090 Pershing Square 595,041 Adelphi Eur Select Equity 30,780 Vanguard Dev Eur ex UK 114,192 Findlay Park American 136,189 Indus Japan JPY Unhedged 143,822 Goodhart: Hanjo 292,351 SR
Slide 12: Contribution by holding, 3 years
-£5,000,000 £10,000,000 £15,000,000 £20,000,000 £25,000,000 £5,000,000 £- -£15,000,000 -£10,000,000 Findlay Park American 3,695,648 BlackRock Eur Hedge 3,136,566 Goodhart: Hanjo 1,864,275 Select Equity Offshore 1,370,518 Adelphi Eur Select Equity 1,041,122 Pershing Square 960,583 Vulcan Value Equity
Slide 13: Performance of less correlated funds
Hansa Investment Company Limited Performance of less correlated funds 1st June 2016 to 31st March 2020 A basket of lower-correlated funds have been purchased since June 2016. HICL Less MSCI ACWI FTSE Gilts UK CPI The performance since has been positive and outperformed bonds and cash. Correlated NR
Slide 14: Transactions during the year to end March 2020
Hansa Investment Company Limited Transactions during the year to end March 2020 • Equity Purchases £10.1m: • Equity Sales £13.9m: – Nexon £1.8m – Hansteen Holdings PLC 4.0m (profit of £0.5m) – CVS Health Corp £1.3m – KT Corp £2.5m (loss of £0.4m) – Orion Engineered Carbons SA £0.9m – Nutrien £1.8m (
Slide 15: Global Equities performance by size of holding
Hansa Investment Company Limited Global Equities – performance by size of holding 31st March 2020 1 Year 3 Year Performance Performance % of (or since (or since Initial Purchase Value Total % of Global initial initial Security Name Date (GBP) NAV Equity Silo purchase) purchase) Interactive Brokers G
Slide 16: Global Equities Silo as at 31 March 2020
Hansa Investment Company Limited Global Equities Silo as at 31st March 2020 Geographic Exposure by Listing 2019/20 Performance 0% Asia , 18% Europe , 28% -5% -10% -7.00% -15% -16.66% -20% -25% -22.08% US, 55% Hansa Investment Company FTSE 100 MSCI ACWI (GBP) Limited Global Equities Performance 16
Slide 17: Portfolio Positioning & Characteristics
Portfolio Positioning & Characteristics 17
Slide 18: Current Positioning
Hansa Investment Company Limited Current Positioning (as at 31st March 2020) 20% 18% 17.5% 16% 14.7% 14% 12.3% 12% 9.6% 10% 8.0% 8% 7.1% 6.2% 6% 5.5% 4% 3.1% 3.4% 3.4% 2.0% 1.7% 2% 1.5% 1.3% 1.0% 1.1% 0.7% 0% 18
Slide 19: Portfolio Characteristics
Hansa Investment Company Limited Portfolio Characteristics (as at 31st March 2020) Look-through analysis of Hansa Investment Company’s portfolio, including holdings in Wilson Sons and Ocean Wilsons (Investments) Ltd* Geographic Exposure Sector Exposure 6.4% 1.3% 1.1% 1.3% 1.0% 4.2% 2.5%1.5% 1.1% 8.0
Slide 20: Other Portfolio Characteristics
Hansa Investment Company Limited Other Portfolio Characteristics (as at 31st March 2020) Total Liquidity Annual 3rd Party Management Fees on Underlying Between 1% and Cash 1.5% Holdings Between 1.5% and Fixed 1% 2% 25% 5.9% 2.1% 1 Week No Fee 44% 39.7% > 6 months Less than 1% 4% 53.6% 6 months 7% 3
Slide 21: Dividend Profile
Hansa Investment Company Limited Dividend Profile Dividend Policy Since September 2019 the Company’s dividend policy has been to pay four similar interim dividends each year. Barring unforeseen circumstances, the dividend is expected to grow over time reflecting the longer term returns of the portfo
Slide 22: Discount
Hansa Investment Company Limited Discount Hansa Investment Company Limited Ord and A Hansa Investment Company Limited Ord and A combined combined (relative to AIC overall average discount) 0% 10% -10% 0% -20% -10% -30% -20% -40% -30% -50% -40% -60% -50% Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-
Slide 23: Ocean Wilsons Holdings
Ocean Wilsons Holdings 23
Slide 24: Ocean Wilsons Holdings
Hansa Investment Company Limited Ocean Wilsons Holdings 58.17% 41.83% Cargo Offshore Consolidation Bases Ocean Wilsons Holdings is a Bermudian investment holding company whose main assets are a controlling interest in Wilsons Sons and an international investment portfolio, both run with a long-term
Slide 25: Wilson Sons
Hansa Investment Company Limited Wilson Sons Wilson Sons is among Brazil’s largest and oldest port, maritime and logistics services companies 25
Slide 26: Wilson Sons economic value generated
Hansa Investment Company Limited Wilson Sons Despite the challenges faced in Brazil in recent years, Wilsons has generated significant economic value 26
Slide 27: Wilson Sons structural growth potential
Hansa Investment Company Limited Wilson Sons Wilson Sons operates in a market with significant structural growth potential 27
Slide 28: Ocean Wilsons (Investments) Limited
Hansa Investment Company Limited Ocean Wilsons (Investments) Limited as at 31st December 2019 35% 31.4% 30% 25% 20% 16.5% 15% 9.4% 10% 5.5% 5.3% 6.1% 4.8% 5% 2.4% 3.0% 2.6% 3.0% 2.3% 1.7% 2.1% 1.9% 1.3% 1.0% 0% Ocean Wilsons (Investments) Limited is an investment portfolio focused on achieving long-
Slide 29: COVID-19: Impact and Thoughts
COVID-19: Impact and Thoughts 29
Slide 30: Introduction
Hansa Capital Partners Introduction • Having started the year with the expectation that economic growth would recover, trade wars diminish and the normal US presidential election bounce, markets have been hammered by an unknown unknown in the form of the Coronavirus (COVID-19) • The ensuing bear mar
Slide 31: COVID-19 Hotspots
Hansa Capital Partners COVID-19 Hotspots 31
Slide 32: Key Events since December 2019
Hansa Capital Partners Russia and Opec oil supply agreement Key Events since December 2019 Cases and deaths collapses, prices crash outside China First death accelerate, DMs outside start selling off 1900 First death Markets China bounce after in China Govs promise 1800 support US announces EU trave
Slide 33: COVID-19 Some Context
Hansa Capital Partners COVID-19…Some Context Number of (Annual) Cases (xK) Number of (Annual) Deaths (xK) 6000 60000 56000 Thousands Thousands 5000 5000 50000 4000 40000 3000 30000 2000 20000 1050 1000 10000 140 650 8 55 0 0 Severe Flu - Global Severe Flu - US COVID-19 - Global Total - Global Severe
Slide 34: Impact on Markets/Economies & Government/Central Bank Actions
IMPACT ON MARKETS/ECONOMIES & GOVERNMENT/CENTRAL BANK ACTIONS 34
Slide 35: Impact: economic and earnings
Hansa Capital Partners Impact…..economic and earnings • Having started the year with higher growth expectations, economies have come to an unprecedented full stop. The resultant recession will be remarkable both in terms of the speed and depth of the contraction and will be comparable or worse than
Slide 36: Impact: economic and earnings
Hansa Capital Partners Impact….economic and earnings 36
Slide 37: Impact: market performance (local currency)
Highlights the extent of falls at the point of Hansa Capital Partners maximum fear Impact……market performance chart (to 31/3/20, LC) 1yr to 23 1 Jan 2020 to 23 March 2020 LC Returns as of 31 Mar 2020 1w 1m YTD 1y 3y 5y March 2020 23 March 2020 to Today Equities - Regions MSCI ACWI + FM NR USD 6.4 -1
Slide 38: Impact: market performance (GBP)
Highlights the extent of falls at the point of Hansa Capital Partners maximum fear Impact…..market performance chart (to 31/3/20, GBP) 1yr to 23 1 Jan 2020 to 23 March 2020 LC Returns as of 31 Mar 2020 1w 1m YTD 1y 3y 5y March 2020 23 March 2020 to Today Equities - Regions MSCI ACWI + FM NR USD MSCI
Slide 39: Government and central bank intervention
Hansa Capital Partners Government and central bank intervention • Governments and central banks have implemented a number of different policy measures to attempt to alleviate the situation. Governments were initially slow in their actions but have been catching up fast Central RATES Bank -Central ba
Slide 40: Our Thoughts
OUR THOUGHTS 40
Slide 41: Thoughts
Hansa Capital Partners Thoughts • Initially markets saw COVID-19 as being similar to the other epidemics that have occurred in recent years (SARS, H1N1, Ebola). • These typically saw sharp sell-offs as investors feared the worse but ultimately the rebound was equally sharp and powerful as the impact
Slide 42: Thoughts: reinfection rates
Hansa Capital Partners Thoughts….reinfection rates • Again the thinking has evolved on the way in which the reinfection rate plays out. Initially governments and markets had been very much in the camp that periods of lockdown and working from home would be temporary and short-term. Increasingly ther
Slide 43: Thoughts: economic outlook
Hansa Capital Partners Thoughts…..economic outlook • We are still very much in the discovery phase as to where economies base. This will become more apparent over the next quarter or two • Perhaps more important will be the speed and shape of the recovery • Our sense is that governments and central
Slide 44: Thoughts: what is priced into markets?
Hansa Capital Partners Thoughts….what is priced into markets? • Going into the current setback equities and assets generally were highly valued. It was possible to argue that equities were not expensive when compared to bonds but certainly valuations weren’t supportive of stock markets • Following r
Slide 45: Thoughts: what is priced into markets?
Hansa Capital Partners Thoughts….what is priced into markets? 45
Slide 46: Thoughts: conclusion
Hansa Capital Partners Thoughts….conclusion • What started out as a normal event driven situation evolved quickly into something much more dangerous • Whilst we have a fairly good idea as to how conventional cyclical recessions unravel we don’t really have a playbook as to how the current situation
Slide 47: Summary
Hansa Capital Partners Summary 47
Slide 48: Appendix
Appendix 48
Slide 49: Investment process overview
Hansa Capital Partners Investment process…..Overview Dynamic Asset We believe in dynamically moving between asset classes to reflect both valuations and the Allocation position within the business cycle. We are truly global in our outlook We do not view volatility as being an important risk. Rat
Slide 50: Investment process: Dynamic Asset Allocation
Hansa Capital Partners Investment process….. Dynamic Asset Allocation Global Equities Multi Asset Portfolio Here the Business Cycle becomes the key driver Valuation extremes are key drivers: • We seek to increase/decrease defensive holdings in these periods Time 50
Slide 51: Investment process: Dynamic Asset Allocation
Hansa Capital Partners Investment process….. Dynamic Asset Allocation 100% 90% 80% Long-only 70% Private Equity Private Debt 60% Real Assets 50% Emerging Market Debt 40% High Yield Debt 30% Hedge Funds Market Neutral Funds 20% Cash 10% 0% 2009 2010 2011 2012 2013 2014 A client’s Strategic Asset Al
Slide 52: Investment process: Risk
Hansa Capital Partners Investment process….. Risk -48% -46% The fund management industry defines Much more important are drawdowns which volatility as risk – it’s convenient but not exceed a client’s tolerance ultimately relevant to long–term investors such as Hansa 52
Slide 53: Investment process: Risk and drawdowns
Hansa Capital Partners Investment process…Risk • Drawdowns represent the peak to trough performance of different asset classes at points of market distress. Typically the riskier the asset class the greater the potential drawdown. Drawdowns are problematic when they exceed an investor’s tolerance le
Slide 54: Investment process: Risk protection
Hansa Capital Partners Investment process…..Risk We protect ourselves against permanent impairments in capital in four ways: Valuation based investment approach and dynamically managing portfolios through business cycles Investing in high quality managers through a rigorous due diligence proce
Slide 55: Investment process: Portfolio Blending
Hansa Capital Partners Investment process….. Portfolio Blending Long-Only Long-Short Strategic Core Our natural hunting A combination of all-weather Regional Silo ground – as endowment managers or protection in type investors we want more mature business cycles to capture the natural Fee consc
Slide 56: Investment process: Well connected
Hansa Capital Partners Investment process…..Well connected We have seeded some exceptional managers The combination of an extraordinarily well connected network and an experienced team enables us to invest in exceptional managers These managers are not normally available to the man on the stre
Slide 57: Investment process: Global equity selection
Hansa Capital Partners Investment process…..Global equity selection Our global equity portfolio is composed of 20 – 45 names, is diversified, has a high active share and is built from the bottom up 57
Slide 58: Investment process: Summary
Hansa Capital Partners Investment process…..Summary Proprietor DNA A proprietor driven approach is central to how we manage money….patient, unconstrained and dynamic A dynamic approach We believe a static approach to managing money fails to reflect how cycles evolve and valuations change Well co
Slide 59: The Team
Hansa Capital Partners The Team William Salomon *(years in industry/ years at Hansa) Managing Partner (31yrs/18yrs) Alec Letchfield Chief Investment Officer, Partner (26yrs/6yrs) Christopher Townsend Private Equity (20yrs/9yrs) William Lewis George Clifton-Brown Jon-Kit Chan Rob Royle Research Analy
Slide 60: Team Biographies
Hansa Capital Partners Team Biographies William Salomon Managing Partner William Salomon has extensive knowledge of all aspects of private client and strategic fund investment business. He was responsible for developing Finsbury Asset Management and the Finsbury range of funds based on the concept o
Slide 61: Team Biographies
Hansa Capital Partners Team Biographies Christopher Townsend Private Equity Christopher is a qualified solicitor. He has an MA from Peterhouse, Cambridge and was awarded an MBA from London Business School. He is currently investment director at Hansa Capital GmbH and a non- executive Director of Oce
Slide 62: Team Biographies
Hansa Capital Partners Team Biographies William Lewis Research Analyst Will joined Hansa Capital Partners LLP in 2012, after four years on the investment team at what was then Lord North Street, now Sandaire Investment Office, a London-based private investment office. He graduated from the Universit
Slide 63: Important Notice
IMPORTANT NOTICE This presentation pack is issued by Hansa Capital Partners LLP, which is authorised and regulated by the UK Financial Conduct Authority. Hansa Capital Partners LLP is the Manager to Hansa Investment Company Limited. Hansa Investment Company Limited is not authorised or regulated by
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