Perpetual Limited · ASX:PPT
Perpetual — Shareholder Meeting (October 2008)
27 slides from Perpetual's shareholder meeting presentation, Oct 28, 2008
Slide 1: 2008 Annual General Meeting
For personal use only 2008 Annual General Meeting The Westin Sydney 28 October 2008
Slide 2: Mr Robert Savage, Chairman
Mr Robert Savage Chairman For personal use only 1
Slide 3: Perpetual is in a strong financial position
Perpetual is in a strong financial position For personal use only June 2008 $M Cash holdings 183.1 Investments at market value 77.0 Liquid assets 260.1 Net assets 314.4 Key financial ratios Debt / equity ratio 12.5% EBITDA Interest cover (times) 69 2
Slide 4: The Australian funds management industry is underpinned by mandatory superannuation
The Australian funds management industry is underpinned by mandatory superannuation For personal use only Superannuation assets are expected to more than double in the next 15 years 3.5 $trillion 3 2.5 2 1.5 1 2007 2010 2013 2016 2019 2022 Source: Trowbridge Deloitte super model 3
Slide 5: Our strategy is focussed on our core competencies
Our strategy is focussed on our core competencies For personal use only Grow our core businesses Expand into adjacent businesses Leadership in a broader portfolio underpinned by superannuation growth 4
Slide 6: Sources of profit are changing
Sources of profit are changing For personal use only PBT - $M 250 Perpetual Corporate Trust 200 Perpetual Private Wealth 21% 150 100 8% Perpetual Investments 50 0 2003 (1) 2008 (1) (1) Excludes Group and Support Services and restructure costs 5
Slide 7: 2008 financial year key results
2008 financial year key results For personal use only 6
Slide 8: 2008 financial year result in line with May forecast
2008 financial year result in line with May forecast For personal use only June 2008 June 2007 Change $M $M % Operating profit after tax 133.5 145.3 (8) Gain on sale of investments 21.1 36.8 (43) EMCF losses (25.8) - ~ Net profit after tax 128.8 182.1 (29) Total dividend per share 330¢ 360¢ (8) 7
Slide 9: Outlook to December 2008
Outlook to 31 December 2008 For personal use only “The prolonged and volatile nature of this crisis is making the task of providing guidance even more difficult this financial year. As such, any profit guidance must be considered in the context of these difficult and rapidly changing market conditio
Slide 10: Chief Executive Officer and Managing Director's address to shareholders
Chief Executive Officer and Managing Director’s address For personal use only to shareholders Mr David Deverall Chief Executive Officer and Managing Director 9
Slide 11: Perpetual Investments operating profit before tax
Perpetual Investments operating profit before tax down 3 per cent For personal use only June 2008 June 2007(1) Change $M $M % Total revenues (2) 294.5 282.0 4 Operating expenses (2) 126.6 110.8 14 Amortisation and depreciation 0.8 1.6 (50) Equity remuneration amortisation 20.1 17.4 16 Operating prof
Slide 12: Australian equities – excellent one year performance against benchmark
Australian equities – excellent one year performance against benchmark For personal use only 12 months to 12 months to Fund 30 Sep 2008 30 Sep 2007 Australian Share Fund 5.2% (1.9%) Industrial Share Fund 2.6% 1.7% Concentrated Equity Fund 7.7% 0.3% Smaller Companies Fund 11.2% 2.1% 11
Slide 13: Global equities - significant improvement in investment performance relative to benchmark
Global equities - significant improvement in investment performance relative to benchmark(1) For personal use only % 10 8.7% 8 6 4 3.3% 3.2% 2 0 1 Yr pa 2 Yr pa 3 Yr pa (1) As at 30 September 2008 12
Slide 14: EMCF update
EMCF update For personal use only Managed downside risk Year ended 30 June 2008 $M by hedging parts of portfolio relating US and Mark-to-market position (19.5) European banks Write-downs and hedging (6.3) Limited impact of unprecedented market EMCF position after tax (25.8) volatility on EMCF
Slide 15: Perpetual Private Wealth operating profit before tax
Perpetual Private Wealth operating profit before tax up 8 per cent For personal use only June 2008 June 2007(1) Change $M $M % Total revenues 104.9 98.8 6 Operating expenses 55.3 54.0 2 Amortisation and depreciation 0.6 0.5 20 Equity remuneration amortisation 2.6 1.5 73 Operating profit before tax 4
Slide 16: Perpetual Corporate Trust operating profit before tax
Perpetual Corporate Trust operating profit before tax down 17 per cent For personal use only June 2008 June 2007 Change $M $M % Total revenues 84.2 68.9 22 Operating expenses 47.8 31.0 54 Restructuring costs 3.9 - ~ Amortisation and depreciation 2.0 1.2 67 Equity remuneration amortisation 1.0 1.0 -
Slide 17: Mortgage Services continues to develop new revenue streams
Mortgage Services continues to develop new revenue streams For personal use only N o. of t r a n s a c tio n s 1 0 0 ,0 0 0 9 5 ,0 0 0 8 0 ,0 0 0 6 0 ,0 0 0 4 0 ,0 0 0 4 0 ,0 0 0 2 0 ,0 0 0 1 1 ,0 0 0 1 ,5 0 0 0 2005 2 006 2007 2008 16
Slide 18: Chairman's address to shareholders on the Remuneration Report
Chairman’s address to shareholders on the Remuneration Report For personal use only 17
Slide 19: Perpetual has five core principles of remuneration
Perpetual has five core principles of remuneration For personal use only Variable pay or ‘at risk’ forms a significant part of overall remuneration Variable pay or ‘at risk’ is linked to shareholder wealth creation Short-term incentive payments are uncapped. This is variable and ‘at risk’ Sh
Slide 20: Perpetual's remuneration structure (excluding asset managers)
Perpetual’s remuneration structure (excluding asset managers) For personal use only Set around a median market range and benchmarked against Base companies of similar size and complexity (‘fixed’) Reviewed on an annual basis Short-term cash bonuses determined by annual performance review Short
Slide 21: Short-term incentives and operating profits (OPAT) are highly correlated
Short-term incentives and operating profits (OPAT) are highly correlated For personal use only Notes: 1. 2005 and 2006 balances have been restated to include the results of our global equities business 2. Index of STI paid represents STI paid as a proportion of 2008. STI 2008 is 100 20
Slide 22: Perpetual's remuneration structure (excluding asset managers)
Perpetual’s remuneration structure (excluding asset managers) For personal use only Set around a median market range and benchmarked against Base companies of similar size and complexity (‘fixed’) Reviewed on an annual basis Short-term cash bonuses determined by annual performance review Short
Slide 23: Why re-test LTI hurdles
Why re-test LTI hurdles For personal use only Not always sufficient time for strategic benefits to flow through to the business Allows employees every opportunity to build wealth for our shareholders Reinforces the alignment between the interests of our employees with those of our shareholders
Slide 24: Managing Director's remuneration – actual versus provisioning
Managing Director’s remuneration – actual versus provisioning For personal use only $000s 3,500 1,607 3,147 3,000 2,817 LTIs provisioned under accounting 2,500 747 Long Term Incentives standards 1,607 2,000 Only paid once onerous hurdles are 1,500 1,267 Short Term Incentives exceeded 535 1,000 F
Slide 25: Asset management remuneration
Asset management remuneration For personal use only Asset management remuneration structure is multi-year - shares vest over many years Shares in Australian equities and global equities asset management team structure vest based on performance - poor performance = no shares Plans have substant
Slide 26: We have one of the most enduring and reputable brands in Australian financial services
We have one of the most enduring and reputable brands in the Australian financial services industry For personal use only One of the longest serving, experienced and most awarded fund management teams who are also fully engaged owners of the business Professionalism and integrity which is consis
Slide 27: 2008 Annual General Meeting
For personal use only 2008 Annual General Meeting The Westin Sydney 28 October 2008