Spheria Emerging Cos. Ltd. · ASX:SEC
Spheria Emerging Cos — Shareholder Meeting (November 2022)
23 slides from Spheria Emerging Cos's shareholder meeting presentation, Nov 21, 2022
Slide 1: 2022 Annual General Meeting
For personal use only Spheria Emerging Companies Limited (ASX:SEC) 2022 Annual General Meeting 21 November 2022
Slide 2: Agenda
Agenda For personal use only 2 1. Chairman’s Address 2. Formal Business 3. Investment Update 4. Questions
Slide 3: Chairman's Address
For personal use only Chairman’s Address
Slide 4: Chairman's Address: Investment Objectives
4 Chairman’s Address Investment Objectives For personal use only The Company’s investment objectives are to: • outperform the benchmark, the S&P/ASX Small Ordinaries Accumulation Index, over each full investment cycle (which the Manager considers to be a period of typically 3 to 5 years); and • prov
Slide 5: Objective 1: Outperform the benchmark
5 Chairman’s Address Objective 1: Outperform the benchmark For personal use only Company Performance1 • 6.2% annualised from inception to 31 October 2022 6 months 1 year 3 years p.a. Inception p.a. Company -10.6% -15.8% +6.2% +6.2% Benchmark2 -14.4% -18.3% +1.5% +3.4% Difference +3.8% +2.5% +4.7% +2
Slide 6: Objective 2: Provide Capital Growth and Income
6 Chairman’s Address Objective 2: Provide Capital Growth and Income For personal use only TSR Performance1 • 2.8% annualised from listing date to 31 October 2022 • Share price of $1.9052 compared to an IPO issue price of $2.00 • Dividends of $0.359 paid by the Company since inception, equivalent to
Slide 7: Share price vs NTA
7 Chairman’s Address Share price vs NTA For personal use only • NTA discount has narrowed substantially to a range of 5%-10% over the last 12 months as a result of: 1. Strong investment performance 2. Higher and more regular income Source: Spheria Emerging Companies. Data to 31 October 2022
Slide 8: Spotlight on Dividends
8 Chairman’s Address Spotlight on Dividends For personal use only • Target dividend yield of 4% of NTA p.a. (5.7% including SEC Dividend History 6 franking), paid quarterly at 1% of post-tax NTA. 5.0 5 Introduced new 4% p.a. • Even higher yield when reflected as % of current dividend target, paid 4.
Slide 9: Formal Business
For personal use only Formal Business
Slide 10: Formal Business – Financial statements and reports
Formal Business – Financial statements and reports For personal use only 10 Consideration of financial statements and reports
Slide 11: Adoption of the Remuneration Report
Formal Business – Resolution 1 For personal use only 11 Adoption of the Remuneration Report To consider and, if thought fit, to pass the following resolution: “That the Remuneration Report of the Company for the financial year ended 30 June 2022 be adopted.”
Slide 12: Resolution - Proxies
Formal Business – Resolution 1 - Proxies For personal use only 12 Shares voted For 1,562,426 87.52% Open 151,525 8.49% Against 71,250 3.99% Abstain 91,829
Slide 13: Re-election of Jonathan Trollip as a director
Formal Business – Resolution 2 For personal use only 13 Re-election of Jonathan Trollip as a director To consider and, if thought fit, to pass the following resolution as an ordinary resolution: “That Mr Jonathan Trollip, who retires by rotation in accordance with rule 6.7 of the Company’s Constitu
Slide 14: Resolution - Proxies
Formal Business – Resolution 2 - Proxies For personal use only 14 Shares voted For 1,890,815 93.18% Open 106,127 5.23% Against 32,250 1.59% Abstain -
Slide 15: Investment Manager Update
For personal use only Investment Manager Update Fundamental investing shines through
Slide 16: Product Background
Product Background For personal use only 16 SEC is a listed version of the Spheria Australian Smaller Companies Fund Designed to give investors exposure to: • cash generative • lowly geared smaller companies • with supportive valuations. SEC will typically have 20-65 stocks (currently 44) with a m
Slide 17: Performance – Graphical Illustration
Performance – Graphical Illustration For personal use only 17 Source: IRESS, Spheria to 31st October 2022
Slide 18: Flight Centre: Ready for takeoff
Flight Centre (ASX:FLT) 18 Ready for takeoff For personal use only Cash Flow Conversion (EBITA) 500 120% 100% 300 100% 100 80% -100 60% -300 40% -500 20% -700 0% FY06A FY07A FY08A FY16A FY17A FY18A FY04A FY09A FY19A FY05A FY10A FY11A FY14A FY12A FY15A FY20A FY21A FY03A FY13A FY22A Free Cash Flow bef
Slide 19: Top Company Holdings and Sector Exposure
Top 10 Company Holdings and Sector Exposure For personal use only 19 Spheria Emerging Companies Limited Spheria Emerging Companies Limited Ticker Company Name % Portfolio 35.0% IVC InvoCare Limited 5.2 30.0% FLT Flight Centre Travel 5.1 25.0% MND Monadelphous Group 4.4 20.0% IRE IRESS Limited 4.4 15
Slide 20: Outlook
Outlook For personal use only 20 • Broad based share price declines provide significant opportunity for “through the cycle” valuation led investors. • The growth-momentum narrative collapsed providing some pockets of reasonable opportunity. • Overexuberance in some sectors remains e.g. Lithium miner
Slide 21: Questions
For personal use only Questions
Slide 22: Disclaimer
Disclaimer For personal use only Note: Past performance is not a reliable indicator of future Subject to any liability which cannot be excluded under the information is not intended as a securities recommendation or performance. relevant laws, SEC and Spheria disclaim all liability to any person s
Slide 23: Thank you for joining us
For personal use only Thank you for joining us SEC Shareholder Enquiries For general information about your shareholding please contact the Share Registry, Automic. T: 1300 288 664 E: [email protected] For investment enquiries please contact Pinnacle T: 1300 010 311 E: [email protected]
Spheria Emerging Companies — Shareholder Meeting (November 2022) on 6ix