Hansa Investment Company Ltd · LSE:HAN
Hansa Investment — Investor Presentation (October 2019)
54 slides from Hansa Investment's investor presentation, October 2019
Slide 1: Hansa Investment Company Limited, October 2019
“6 HANSA INVESTMENT xy COMPANY LIMITED October 2019
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: Index
Hansa Investment Company Limited Index • History of Hansa & Strategic Review • Performance Review • Portfolio Positioning & Characteristics • Ocean Wilsons Holdings • Market Outlook • Appendix 3
Slide 4: History of Hansa & Strategic Review
History of Hansa & Strategic Review 4
Slide 5: Timeline
Hansa Investment Company Limited Hansa timeline Rea Brothers acquire a number of Finsbury Trust becomes investment companies, including Hansa Trust Scottish and Mercantile Hansa Trust becomes Rea Brothers purchases Hansa Investment 58% of Ocean Wilsons Scottish and Company Limited Holdings Limited M
Slide 6: Corporate structure
Hansa Investment Company Limited Corporate structure Hansa Investment Company Limited 6
Slide 7: Strategic Review
Hansa Investment Company Limited Strategic Review 30th September 2019 Description Portfolio January 2014 Weight Core Regional Core Regional exposure based on the output 38.1% Description Portfolio of the Hansa House View. Weight UK Special situation UK equities 65% Thematic Thematic Growth sec
Slide 8: Performance Review
Performance Review 8
Slide 9: Market Performance 2018 vs 2019 to end September
Hansa Investment Company Limited Market Performance 2018 vs 2019 to end September (£) 40% 30% 29% 25% 20% 23% 22% 22% 20% 19% 18% 17% 16% 16% 15% 14% 15% 15% 15% 10% 12% 11% 10% 10% 9% 7% 7% 6% 4% -1% -2% 6% 0% 0% 4% 4% 5% 6% 0% 4% -1% 2% -3% -4% -3% 0% -4% -4% 1% 1% 2% 1% -6% -8% -7% -9% -9% -10% -
Slide 10: NAV, Share Price and KPI Performance
Hansa Investment Company Limited NAV, Share Price and KPI Performance Financial YTD Financial Year Financial Year 3 years to end 5 years to end 15 years to end end September 2019 2018-19 2017-18 September 2019 (p.a.) September 2019 (p.a.) September 2019 (p.a.) NAV Performance TR -0.4% 5.6% 6.3% 4.9%
Slide 11: Peer Group Analysis (to 30th September 2019)
Hansa Investment Company Limited Peer Group Analysis (to 30th September 2019) % % Net % NAV % Price Price Size £m Discount Yield Performance Performance Now Mkt Cap Assets 3y 3y Total Return Total Return Global Global AIC Sector ATS Artemis Alpha Trust UK All Companies 280.00 -19.3 112 155 1.8 17 21
Slide 12: Peer Group Analysis (three years)
Hansa Investment Company Limited Peer Group Analysis (three years to 30th September 2019) 45% 40% 35% 30% 25% Return (£) 20% 15% 10% 5% 0% 12
Slide 13: Performance of the different silos, one year
Hansa Investment Company Limited Performance of the different silos one year to 30th September 2019 8% 6% 4% 2% 0% -2% -4% -6% -8% -10% Core Regional Funds Thematic Global Equities Ocean Wilsons Holdings Diversifying Assets Cash/FX Exposure Ltd 13
Slide 14: Holdings by silo (value)
£10,000,000 £12,000,000 £14,000,000 £16,000,000 £2,000,000 £4,000,000 £6,000,000 £8,000,000 £- Findlay Park American 2,789,819 Select Equity Offshore 1,844,088 Pershing Square 1,376,127 Vulcan Value Equity 1,236,532 Adelphi Eur Select Equity 833,018 BlackRock Eur Hedge 747,846 Goodhart: Hanjo 598,01
Slide 15: Holdings by silo (value, continued)
£10,000,000 £20,000,000 £30,000,000 £40,000,000 £50,000,000 £60,000,000 £70,000,000 £- Findlay Park American 7,656,797 Select Equity Offshore 5,162,185 Goodhart: Hanjo 4,758,237 Vulcan Value Equity 4,699,311 Adelphi Eur Select Equity 2,208,491 BlackRock Eur Hedge 2,011,325 Indus Japan JPY Unhedged 1
Slide 16: Performance of less correlated funds
Hansa Investment Company Limited Performance of less correlated funds 1st June 2016 to 30th September 2019 A basket of lower-correlated funds have been purchased since June 2016. The performance since has been positive and outperformed cash. 45.0% 40.0% 35.0% 30.0% 25.0% Performance (GBP) 18.9% 20.0
Slide 17: Transactions during 2019
Hansa Investment Company Limited Transactions during 2019 • Equity Purchases £9.0m: • Equity Sales £6.9m: – Dollar General £2.0m – KT Corp £2.5m (loss of £0.4m) – ITE Group PLC £1.9m – Coca-Cola Bottlers Japan Holdings Inc £1.5m (loss of £0.6m) – CK Hutchison £1.2m – Hilton Food Group PLC £1.4m (pro
Slide 18: Global Equities – performance by size of holding
Hansa Investment Company Limited Global Equities – performance by size of holding 30th September 2019 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) EXOR NV 05/09/201
Slide 19: Global Equities Silo as at 30th September 2019
Hansa Investment Company Limited Global Equities Silo as at 30th September 2019 Geographic Exposure by Listing Performance 1 October 2018 to 30 September 2019 Asia , 11% 7% 6% 5% Europe , 34% 4% 3% 2% 1% 0% -1% US, 55% -2% World Index FTSE 100 Hansa Investment Company Limited Global Equities Perform
Slide 20: Portfolio Positioning & Characteristics
Portfolio Positioning & Characteristics 20
Slide 21: Current Positioning
Hansa Investment Company Limited Current Positioning (as at 30th September 2019) 18% 17.0% 16.4% 16% 14% 13.5% 12% 11.4% 10% 8% 6.6% 5.8% 6.2% 6% 4.7% 4% 3.2% 2.8% 2.8% 2.3% 1.8% 1.5% 2% 1.4% 1.0% 1.3% 0.3% 0% 21
Slide 22: Portfolio Characteristics
Hansa Investment Company Limited Portfolio Characteristics (as at 30th September 2019) Look-through analysis of Hansa Investment Company’s portfolio, including holdings in Wilson Sons and Ocean Wilsons (Investments) Ltd* Geographic Exposure Sector Exposure 6.7% 1.9% 0.5% 0.3% 0.6% 4.2% 2.9% 1.8% 0.3
Slide 23: Other Portfolio Characteristics
Hansa Investment Company Limited Other Portfolio Characteristics (as at 30th September 2019) Annual 3rd Party Management Fees on Total Liquidity Underlying Holdings Between 1% Between 1.5% Cash and 1.5% to 2% Fixed 0% 5.5% 2.0% 28% 1 Week 38% No Fee 43.4% 1% or less >6 49.1% months 4% 6 months 6% 3
Slide 24: 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 25: Discount to asset value
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% -10% -20% -20% -30% -30% -40% -40% -50% -50% Sep-09 Mar-10 Sep-10 Mar-11 Sep-11 Mar-12 Sep-12 Ma
Slide 26: Ocean Wilsons Holdings
Ocean Wilsons Holdings 26
Slide 27: Ocean Wilsons Holdings
Hansa Investment Company Limited Ocean Wilsons Holdings 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 view. The Oceans holding is controlled by the Han
Slide 28: Wilson Sons
Hansa Investment Company Limited Wilson Sons Wilson Sons is among Brazil’s largest and oldest port, maritime and logistics services companies 28
Slide 29: Wilson Sons: significant economic value generated
Hansa Investment Company Limited Wilson Sons Despite the challenges faced in Brazil in recent years, Wilsons has generated significant economic value 29
Slide 30: Wilson Sons: structural growth potential
Hansa Investment Company Limited Wilson Sons Wilson Sons operates in a market with significant structural growth potential 30
Slide 31: Ocean Wilsons Investments (Limited) as at June 2019
Hansa Investment Company Limited Ocean Wilsons Investments (Limited) as at 30 June 2019 35.0% 32.0% 30.0% 25.0% 20.0% 15.9% 15.0% 9.3% 10.0% 5.4% 6.1% 5.1% 4.8% 5.0% 2.9% 2.6% 2.6% 1.7% 2.2% 2.3% 2.2% 2.0% 1.9% 1.0% 0.0% 0.0% Ocean Wilsons Investments (Limited) is an investment portfolio focused on
Slide 32: Market Outlook
Market Outlook 32
Slide 33: 2018……the beginning of the end?
Hansa Investment Company Limited 2018……the beginning of the end? 2018 saw downgrades across the board with the US the Economies are undoubtedly maturing notable exception …..2018 characterised by slowing growth, both globally and China in particular 33
Slide 34: 2018: escalating trade war
Hansa Investment Company Limited 2018……the beginning of the end? …..Trump has progressively escalated his war on trade 34
Slide 35: 2018: all asset classes fell
Hansa Investment Company Limited 2018……the beginning of the end? ……..this backdrop saw US equities produce their worst December performance since the 1920’s and, unusually, all asset classes fell in 2018 35
Slide 36: 2019……markets have rallied sharply
Hansa Investment Company Limited 2019……markets have rallied sharply US fed announced a U-turn on interest rate policy in Lower growth but not recession January 36
Slide 37: 2019: tech-led cycle, conservative positioning
Hansa Investment Company Limited 2019……markets have rallied sharply This cycle has been all about tech Market positioning remains conservative ……the current bull market has been a deeply unloved one. Technology has been key to its success and may not be finished yet 37
Slide 38: Appendix
Appendix 38
Slide 39: Performance of the different silos, three years
Hansa Investment Company Limited Performance of the different silos three years to 30th September 2019 70% 60% 50% 40% 30% 20% 10% 0% Core Regional Funds Thematic Global Equities Ocean Wilsons Holdings Diversifying Assets Cash/FX Exposure Ltd 39
Slide 40: 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 41: 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 41
Slide 42: Dynamic Asset Allocation over time
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 43: 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 43
Slide 44: 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 45: Protecting against permanent capital impairment
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 46: 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 47: 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 48: 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 48
Slide 49: 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 50: 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 51: 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 52: 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 53: 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 54: 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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