Hansa Investment Company Ltd · LSE:HAN
Hansa Investment — Investor Presentation (May 2024)
49 slides from Hansa Investment's investor presentation, May 2024
Slide 1: Shareholder Presentation May 2024
Shareholder Presentation May 2024
Slide 2: Our mission
Our mission A globally-diversified, multi-asset class investor who seeks to identify compelling investment opportunities. Long-term, Access to the world’s Dare to be Operating outside not short-term elite, best-in-class managers different the bureaucracies of a large institution © 2023 Hansa Investm
Slide 3: Why HICL?
Why HICL? 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 retail investor. © 2023 Hansa Investment Company Limited 3
Slide 4: Board of Directors
Board of Directors Jonathan Davie Simona Heidempergher Richard Lightowler William Salomon Nadya Wells Chairman Chair Of Remuneration Committee Chair Of Audit Committee Non-independent, Non-executive Senior Independent Director & Chair Of Director Nominations Committee Jonathan became Chairman of Han
Slide 5: Value of HICL holding in Wilson Sons
Value of HICL holding in Wilson Sons Wilsons Sons, £96.3m, Ocean Wilsons Holdings 21.2% Remainder of the Portfolio, Ocean Wilson £324.5m, (Investments) Limited, 71.4% £33.7m, 7.4% *The fair value of Hansa Investment Company Limited’s holding in OWHL has been apportioned across the two assets in the
Slide 6: Investment Manager's Report
Investment Manager’s Report © 2023 Hansa Investment Company Limited 6
Slide 7: Agenda
Agenda 1. Executive Summary 2. Positioning 3. Performance Attribution 4. Conclusion © 2023 Hansa Investment Company Limited 7
Slide 8: Executive Summary
Executive Summary © 2023 Hansa Investment Company Limited 8
Slide 9: Executive summary: NAV, Share Price and KPI Performance to 31st March 2024
Executive summary: NAV, Share Price and KPI Performance to 31st March 2024 Financial Year Q4 / Financial Year 2023-24 / 3 years (p.a.) 5 years (p.a.) 15 years (p.a.) Equal Weighted 2022-23 Equal Weighted NAV Performance TR 10.6% 25.1% (3.1%) 8.4% 7.4% 9.1% NAV Performance ex. OWHL TR 8.6% 14.0% (2.7
Slide 10: Executive summary: Fund subscriptions from 1st April 2023 to 31st March 2024
Executive summary: Fund subscriptions from 1st April 2023 to 31st March 2024 Cost Fund Trade Date (£m) Nephila Iron Catastrophe Fund Ltd May 2023 2.5 Armistice Capital Offshore Fund Ltd June 2023 6.9 Polar Capital Fund - Global Technology September 2023, February 2024 8.4 Simplex Value Up Master Oct
Slide 11: Executive summary: Fund redemptions from 1st April 2023 to 31st March 2024
Executive summary: Fund redemptions from 1st April 2023 to 31st March 2024 Proceeds Profit/Loss Fund Trade Date (£m) (£m) GAM Star Fund PLC – Disruptive Growth April, September 2023 1.5 1.0 Egerton Long – Short Fund July 2023 6.9 0.9 Global Event Partners Ltd July 2023 2.5 0.8 Goodhart Partners: Han
Slide 12: Executive summary: Direct equity purchases and sales
Executive summary: Direct equity purchases and sales from 1st April 2023 to 31st March 2024 Direct equity purchases Direct equity sales Cost Cost Profit / Loss Security Trade Date Security Trade Date (£m) (£m) (£m Bergman & Beving April, May, July, August 2023 0.7 CVS Health Corp April 2023 0.5 0.0
Slide 13: Executive summary: Key winners and losers
Executive summary: Key winners and losers Key Winners and Losers 12 Months to 31st March 2024 50.0% 40.0% 30.0% 20.0% 10.0% 0.0% -10.0% Pershing RA Capital GAM Star Fund Findlay Park BlackRock Nephila Iron BlackRock Arcus Japan Selwood AM - Keynes BB Biotech AG Goodhart Square International PLC - Di
Slide 14: Portfolio Positioning - Allocation vs MSCI ACWI
Portfolio Positioning (excluding Diversifying Funds and Wilson Sons) - Allocation vs MSCI ACWI (as at 31st March 2024) Geographic Allocation* Sector Allocation* 70.0% 25.0% 60.0% 20.0% 50.0% 15.0% 40.0% 30.0% 10.0% 20.0% 5.0% 10.0% 0.0% 0.0% HICL MSCI HICL MSCI *Look-through to Top 30 investments in
Slide 15: Positioning
Positioning © 2024 Hansa Investment Company Limited 15
Slide 16: Positioning: inflation, rates and valuations
Positioning Inflation develops as not too hot or too cold On balance, interest rates are likely to decline 10.0% 6.0% 8.0% 6.0% 4.0% 4.0% 2.0% 2.0% 0.0% Jul-2021 Jul-2022 Jul-2023 Jul-2024 Apr-2021 Apr-2022 Apr-2023 Apr-2024 Jan-2021 Jan-2022 Jan-2023 Jan-2024 Oct-2021 Oct-2022 Oct-2023 Oct-2024 0.0
Slide 17: Positioning: Indexed USD Performance
Positioning We can utilise volatility due to the longevity of our investment horizon 6100 5100 Indexed USD Performance 4100 3100 2100 1100 100 1980 1984 1988 1992 1996 2000 2004 2008 2012 2016 2020 2024 MSCI World Index ……we do advocate more diversification….by country, factor and driver © 2024 Hans
Slide 18: Performance Attribution
Performance Attribution © 2023 Hansa Investment Company Limited 18
Slide 19: Gross time-weighted performance of the different silos
Gross time-weighted performance of the different silos 5 years To 31 March 2024 100.0% 80.0% 77.2% 73.9% 70.1% 64.6% 60.0% 56.8% 52.0% 51.5% 40.0% 30.6% 30.3% 26.7% 26.8% 24.3% 20.0% 0.0% -2.4% -20.0% -15.2% -17.5% -40.0% Core Regional Thematic Core & Global Equities Ocean Wilsons Diversifying Priva
Slide 20: Holdings by fund to 31 March 2024
£- £100,000,000 £120,000,000 £140,000,000 £160,000,000 £180,000,000 £20,000,000 £40,000,000 £60,000,000 £80,000,000 Findlay Park American 15,684,776 To 31 March 2024 Pershing Square 9,706,145 Select Equity Offshore 8,281,122 BlackRock Strat Equity Hedge 8,189,176 iShares Core S&P 500 6,402,206 Indus
Slide 21: Performance of less correlated funds
Performance of less correlated funds 1 June 2016 to 31 March 2024 Performance of Less Correlated Funds Max Drawdown 50.0% 0.0% 42.6% -0.7% 40.0% -5.0% -4.5% 32.5% 30.0% -10.0% 20.0% -15.0% -15.9% 10.0% -20.0% 0.0% -25.0% -10.0% -30.0% -9.4% -31.8% -20.0% -35.0% HICL Less Correlated Funds UK CPI FTSE
Slide 22: Conclusion
Conclusion © 2023 Hansa Investment Company Limited 22
Slide 23: Conclusion
Conclusion • Global markets remained remarkably strong in Q1 with the US continuing to lead the way on the back of strong economic performance and ongoing enthusiasm for AI • At the macro level, inflation remained at the forefront, surprising on the upside and causing rate cut expectations to dimini
Slide 24: Conclusion
Conclusion Globally diversified, Benchmark The recent introduction The blend of private Markets are undergoing multi-asset class unconstrained, seeking of a private equity equity/defensives and something of a investors who seek to conservatively grow programme adds growth equities creates
Slide 25: Ocean Wilsons Holdings
Ocean Wilsons Holdings © 2023 Hansa Investment Company Limited 25
Slide 26: Wilson Sons' Business Timeline
Wilson Sons’ Business Timeline 1997 2003 2007 2012 2016 Container terminal operations begin Offshore support vessel operations Wilson Sons’ IPO on the Brazilian 1st expansion of Salvador container Renewal of Salvador container with the successful bid which begin with the launch of PSV Stock Exchange
Slide 27: Cumulative inflation and R$ evolution since IPO 2007
Cumulative inflation and R$ evolution since IPO 2007 Sharp depreciation of BRL in 2016 and 2019 although long term exchange rate slightly above cumulative difference in Exchange rate BRL:USD vs Brazil Inflation vs Inflation US CPI from IPO to 20/9/2023 (Base 100) BR CPI US CPI 1239% BR:US CPI Spread
Slide 28: Investment Performance Since the IPO (2007)
Investment Performance Since the IPO (2007) US Total shareholder return impacted by BRL depreciation. Both BRL and US total share return restricted between 2016 and 2022 by weak performance of oil and gas service businesses including vessels bases and to some degree towage. Total Return - USD Total
Slide 29: IFRS Financial Performance Since the IPO
IFRS Financial Performance Since the IPO Long-term US$ revenue growth impacted by depreciation of the R$ with US$ EBITDA naturally hedged. Net revenue and growth U$M, last twelve months CAGR 07-22: +1% 950 20.9% 23.3% -4.1% 20.4% 21.3% -12.6% 8.1% -4.0% -19.7% -10.2% 8.6% -7.3% -11.8% -13.1% 12.4% 1
Slide 30: Capex and Shareholder Remuneration
Capex and Shareholder Remuneration Dividends since IPO total US$439 million which is 40% of current market capitalisation. Capex should be maintenance with minimal expansion capex needed in the medium term. Capital expenditure US$M (1) 263 Offshore Vessels (50% JV) 36 IFRS 184 167 150 56 137 39 111
Slide 31: Financial Multiples Analysis
Financial Multiples Analysis as of 20-Sep-23 31
Slide 32: Offshore energy: Attractive market perspectives
Offshore energy: Attractive market perspectives Brazil’s O&G market to become increasingly important for global energy demand. 1 Brazil is Extremely Competitive in Offshore Oil Production… 2 …Fostering the Growth of Oil Exploration in the Country # of Contracted FPSOs 6 5 5 Competitive Breakeven Low
Slide 33: Growth Strategy
Growth Strategy Multiple growth prospects underpinning sustainable long-term value creation. RIO GRANDE TERMINAL SALVADOR TERMINAL TOWAGE OFFSHORE ENERGY 1 Post-Covid Normalisation 1 New Quay Capacity 1 Market Growth, Commodity Focus 1 Market Growth 2 Plate Transshipment 2 Renewable Energy Projects
Slide 34: Appendix
Appendix © 2023 Hansa Investment Company Limited 34
Slide 35: Hansa timeline
Hansa timeline Rea Brothers acquire the management of Finsbury Trust becomes Hansa a number of invesment companies, Trust including Scottish & Mercantile Rea Brothers purchases 58% of Hansa Trust becomes Ocean Wilsons Holdings Limited on Hansa Investment behalf of its clients including Company Limit
Slide 36: Corporate structure
Corporate structure Hansa Investment Company Limited 26.45% of OWHL is held by HICL 100% Ocean Wilsons Holdings Limited Fund and Direct Equity Holdings Managed by 100% Hansa Capital Partners LLP 56.52% of Wilson Sons is owned by OWHL Ocean Wilsons (Investments) Limited 43.48% Unlisted subsidiary hol
Slide 37: Global equities: performance by size of holding
Global equities: performance by size of holding As at 31 March 2024 1 Year 3 Year Initial % of Performance Performance Purchase Value % of Global Equity (or since (or since Security Name Date (GBP) Total NAV Silo initial purchase) initial purchase) Interactive Brokers Group Inc 05/04/2017 6,365,548
Slide 38: Global equities silo
Global equities silo As at 31 March 2024 Geographic exposure by listing Performance 1 Year to end March 2024 Asia , 4% 25% 20.6% 20% US, 37% 14.7% 15% Europe , 59% 10% 8.4% 5% 0% Hansa Investment Company FTSE All Share Total Return MSCI ACWI NR (GBP) Limited Global Equities Performance © 2023 Hansa
Slide 39: Fees
Fees The fee debate is nuanced. Clearly you want to keep fees Passive Third party Can be higher cost with down to reduce friction but Low cost but guaranteed two layers of fees in a sub market returns. Also going low cost may work to your structurally biased fund structure. However, you can invest i
Slide 40: Fees
Fees Weighted average management Annual 3rd party management fees on underlying holdings fee = 1.3%. This includes the 60.0% management fee paid to Hansa Capital Partners LLP as well as management fees paid to third 50.0% 49.3% parties for the underlying funds. 40.0% 38.3% 30.0% 20.0% 10.0% 8.3% 4.2
Slide 41: Fees
Fees Third party fees within HICL 3.0% Internally managed therefore no third party fees 2.5% Fees as % of NAV 2.0% Our management 1.5% fee is reduced from 1% as it is not charged on Ocean 1.0% Wilsons Holdings 0.5% 0.0% HICL RIT Capital Witan Jupiter Merlin Schroder ISF BNY Mellon abrdn GARS Ruffer
Slide 42: % Premium/Discount
Discount Discount to NAV of the Company’s shares compared to other family controlled holding companies and selected others. (December 2023) Manchester & RIT Capital London Hansa Caledonia Partners British & Investment Eurazeo Investment Investments (Rothschild Majedie American Pershing Trust (Jean-C
Slide 43: Discount
Discount Impact of share buybacks is not always a long term reduced discount. PSH 5-Year Annualised NAV Return +25.1%* Share buybacks from 2017 through 2022 repurchased 59.1 million shares for $1.1 billion at an average discount to NAV of 28.1%.* Source: Bloomberg & *PSH Annual Investor Presentation
Slide 44: The team
The team William Salomon Senior Partner 41yrs / 24yrs Alec Letchfield Chief Investment Officer, Partner 31yrs / 11yrs Christopher Townsend Investment Director 24yrs / 14yrs William Lewis George Clifton-Brown Henry Millhouse Robert Royle Research Analyst Research Analyst Research Assistant Investment
Slide 45: Team biographies
Team biographies William Salomon Alec Letchfield Senior Partner Chief Investment Officer, Partner William Salomon has extensive knowledge of In 1999 Rea Brothers Group was taken over Alec has over 30 years' experience in Group. This highly diverse range of solutions all aspects of private client and
Slide 46: Team biographies
Team biographies Christopher Townsend Robert Royle Investment Director, Private Equity Investment Manager, Global Equities Christopher is a qualified solicitor. He has an MA from Peterhouse, Cambridge and was Robert joined Hansa Capital Partners in 2016 to manage Global Equity portfolios. Prior to t
Slide 47: Team biographies
Team biographies William Lewis George Clifton-Brown Henry Millhouse Research Analyst Research Analyst Research Assistant Analyst Will joined Hansa Capital Partners LLP in 2012, after George joined Hansa Capital Partners LLP in 2018, Henry joined Hansa Capital Partners LLP in 2022 having four years o
Slide 48: Important notice
Important notice It is very important that you consider this disclaimer and warning before using the information provided within this presentation pack, as it explains certain regulatory and legal restrictions applicable to any investment services provided, the use and distribution of information in
Slide 49: Slide 49
Hansa Investment Company — Investor Presentation (May 2024) on 6ix