Perpetual Limited · ASX:PPT
Perpetual — FY2016 Earnings Presentation
31 slides from Perpetual's earnings presentation, Aug 25, 2016
Slide 1: FY16 Results – Twelve Months to 30 June 2016
25 August 2016 PERPETUAL LIMITED For personal use only FY16 RESULTS TWELVE MONTHS TO 30 JUNE 2016 Geoff Lloyd Chief Executive Officer & Managing Director Gillian Larkins Chief Financial Officer ABN 86 000 431 827
Slide 2: FY16 Overview
FY16 OVERVIEW SOLID RESULTS IN VOLATILE MARKETS FROM INCREASINGLY DIVERSIFIED BUSINESS For personal use only Solid Results NPAT up DPS up Initiatives showing 8% 6% momentum on FY15 on FY15 Perpetual Perpetual Perpetual Investments Private Corporate Trust delivers solid results and delivers six conse
Slide 3: Strategy Delivering Growth and Returns
FY16 STRATEGY DELIVERING GROWTH AND RETURNS For personal use only UPAT, $m NPAT, $m NPAT EPS, cps DPS, cps +11% +27% +23% +21% 133.7 128.2 132.0 284.3 255.0 122.5 265.3 240.0 104.1 186.4 175.0 81.6 FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 Note: Percentage increases represented are
Slide 4: FY16 Results: Drivers Are Markets, Flows and New Clients
FY16 RESULTS DRIVERS ARE MARKETS, FLOWS AND NEW CLIENTS For personal use only All Ordinaries Index Perpetual Private – high net worth1 6,100 5,900 Net new clients Average FUA per new client, $m 5,700 5,500 100 4.5 5,300 78 3.6 3.3 5,100 59 4,900 4,700 Average FY16 / FY15: -5.8% 4,500 Jun-13 Oct-13 F
Slide 5: Investments Highlights – Solid Results in Difficult Markets
PERPETUAL INVESTMENTS HIGHLIGHTS – SOLID RESULTS IN DIFFICULT MARKETS For personal use only Proven, disciplined approach to value investing Equities: Inflows from the intermediary channel into contemporary solutions including Ethical, Pure Equity Alpha Australian and Share Plus which has exceeded $1
Slide 6: Strong Long-Term Investment Performance
PERPETUAL INVESTMENTS STRONG LONG-TERM INVESTMENT PERFORMANCE For personal use only QUARTILE RANKINGS1 FUND WEIGHTED % OF FUNDS periods ending June 2016 OVER 1 – 10 YEAR 1Yr 3Yrs 5Yrs 7Yrs 10Yrs Perpetual W Australian 3 3 2 1 1 Open 1 yr 27% 73% Perpetual W Concentrated Equity 3 3 1 1 1 Open Austral
Slide 7: Private: Strategy on Track
PERPETUAL PRIVATE STRATEGY ON TRACK For personal use only VISION: AUSTRALIA’S LEADING INDEPENDENT HNW BUSINESS Strategic segment Right service Scale Distribution Heritage business Tech uplift focus model benefits excellence Net Flows, $b Net New Clients 0.30 54 43 46 0.20 0.20 35 35 24 0.10 0.10 0.0
Slide 8: Private: Funds Under Management Continue to Grow
PERPETUAL PRIVATE FUNDS UNDER MANAGEMENT CONTINUE TO GROW For personal use only FUM inflows from targeted advice clients, $b Strong cumulative inflows of over $1b 0.80 from FY13 – FY16 0.41 Perpetual Private’s Implemented Portfolio funds 0.25 in top 10 funds for net flows1 12 months (for interna
Slide 9: Corporate Trust – Debt Markets: Strong Profit Growth in FY16
PERPETUAL CORPORATE TRUST – DEBT MARKETS STRONG PROFIT GROWTH IN FY16 For personal use only REVENUE DRIVERS Key revenue drivers are higher margin RMBS Securitisation FUA - $b and ABS business 427 380 307 259 Consistent mortgage market growth of 7% CAGR 210 206 217 ABS growth from auto financin
Slide 10: Corporate Trust – Managed Funds: Strong Profit Growth in FY16
PERPETUAL CORPORATE TRUST – MANAGED FUNDS STRONG PROFIT GROWTH IN FY16 For personal use only REVENUE DRIVERS Managed Funds a more meaningful contributor Australian Capital Flows1 , $b to revenue and earnings 52 50 36 29 Introduction of Managed Investment Trusts 21 20 legislation in 2010 material
Slide 11: Financials – Gillian Larkins, CFO
For personal use only FINANCIALS GILLIAN LARKINS CHIEF FINANCIAL OFFICER
Slide 12: Financial Performance – Group
FINANCIAL PERFORMANCE – GROUP INCREASE IN NPAT AND DIVIDENDS For personal use only FY16 2H16 1H16 FY15 FY16 v For the period KEY THEMES $m $m $m $m FY15 Operating revenue 494.2 253.5 240.7 501.5 (1%) Operating revenue impacted Total expenses (316.3) (163.5) (152.8) (312.9) (1%) by lower market level
Slide 13: Investments: Margin Maintained
PERPETUAL INVESTMENTS MARGIN MAINTAINED For personal use only FY16 2H16 1H16 FY15 FY16 v Average FUM, $b For the period $m $m $m $m FY15 32.3 30.0 Revenue 227.9 117.9 110.0 240.0 (5%) Operating expenses (103.0) (54.0) (49.0) (104.9) 2% EBITDA1 124.9 63.9 61.0 135.1 (8%) FY15 FY16 Depreciation & amor
Slide 14: Private: Growth in Flows and Net New Clients
PERPETUAL PRIVATE GROWTH IN FLOWS AND NET NEW CLIENTS For personal use only FY16 2H16 1H16 FY15 FY16 v Revenue, $m For the period $m $m $m $m FY15 166.3 167.6 Market related revenue 107.8 53.9 53.9 110.8 (3%) 55.5 59.8 Non-market related revenue 59.8 31.4 28.4 55.5 8% 110.8 107.8 Total revenues 167.
Slide 15: Corporate Trust: Strong Growth in PBT
PERPETUAL CORPORATE TRUST STRONG GROWTH IN PBT For personal use only FY16 2H16 1H16 FY15 FY16 v Revenue, $m For the period $m $m $m $m FY15 48.3 Trust services revenue 48.3 24.6 23.7 43.8 10% 43.8 38.2 39.0 Fund services revenue 39.0 20.3 18.7 38.2 2% Total fiduciary services revenue 87.3 44.9 42.4
Slide 16: Balance Sheet: Strength Provides Opportunities
BALANCE SHEET STRENGTH PROVIDES OPPORTUNITIES For personal use only Capital requirements2, $m FY16 FY15 For the period ended $m $m -9.5% 176.7 160.0 Net cash ($m) 266.7 254.4 Goodwill and other intangibles1 ($m) 349.6 343.4 FY15 FY16 Net tangible assets ($m) 255.9 240.3 Gearing, % 13.0 12.6 Net tang
Slide 17: Sustained Dividend Growth Over Three Years
FINANCIAL PERFORMANCE SUSTAINED DIVIDEND GROWTH OVER THREE YEARS For personal use only EPS, cps ROE,1 % Dividend, cps 284.3 265.3 22.2 99.8% 21.7 91.3% 90.0% 19.0 186.4 240.0 255.0 175.0 FY14 FY15 FY16 FY14 FY15 FY16 FY14 FY15 FY16 UPAT EPS NPAT EPS UPAT ROE NPAT ROE Fully franked dividend Payout ra
Slide 18: Geoff Lloyd, Chief Executive Officer & Managing Director
For personal use only GEOFF LLOYD CHIEF EXECUTIVE OFFICER & MANAGING DIRECTOR
Slide 19: Strategy: People, Client Advocacy and Shareholder Outcomes
STRATEGY PEOPLE, CLIENT ADVOCACY AND SHAREHOLDER OUTCOMES BEST IN 5 YEARS For personal use only LEAD in core businesses EXTEND into adjacent markets EXPLORE new opportunities GOALS PEOPLE CLIENTS SHAREHOLDERS Employee Engagement Client Advocacy NPAT growth Excellence Australia’s largest Delivering e
Slide 20: Investments: Core Australian Equities Opportunity
PERPETUAL INVESTMENTS CORE AUSTRALIAN EQUITIES OPPORTUNITY For personal use only Growth in superannuation assets, $t 3.3 Growth in pool of superannuation assets underpinned by compulsory 2.0 0.4 superannuation guarantee Market: 1.6 Australian equities funds in net inflow on Mar-162 2025 average over
Slide 21: Investments: Extending and Leveraging Existing Capabilities
PERPETUAL INVESTMENTS EXTENDING AND LEVERAGING EXISTING CAPABILITIES For personal use only Global Equities Multi Asset – Real Return Credit and Fixed Income FUM1, $b FUM2, $b FUM1, $b 226 73 169 2020 market 2020 market 2020 market opportunity opportunity opportunity Top quartile performance over 3
Slide 22: Private: HNW Segment Represents 80% of the $5B Advice Revenue Pool
PERPETUAL PRIVATE HNW SEGMENT REPRESENTS 80%1 OF THE TOTAL $5B ADVICE REVENUE POOL For personal use only Chosen segments in HNW Business owners 30% of HNW market Funds Under Advice, $b Focused segment 12.7 strategy leverages: 1.0 Cash Private client expertise 4.0 Other2 Established wealthy 25% of HN
Slide 23: Private: Fordham a Key Driver of Perpetual Private's Strategy
PERPETUAL PRIVATE FORDHAM A KEY DRIVER OF PERPETUAL PRIVATE’S STRATEGY For personal use only Accounting Firm Revenue growth FY15 – FY161, % Fordham provides integrated accounting, tax and advisory services for business owners and 16.7 14.7 14.5 13.2 families; leading referral partner to Perpetual
Slide 24: Corporate Trust: 9% Profit Before Tax Growth from Diversified Business
PERPETUAL CORPORATE TRUST 9% PROFIT BEFORE TAX GROWTH FROM DIVERSIFIED BUSINESS For personal use only DEBT MARKETS MANAGED FUNDS FUA of $427.5b as at 30 June 2016 FUA of $193.0b as at 30 June 2016 Residential Automobiles Credit Cards Commercial Agriculture Commercial Industrial Hotels Forestry Infra
Slide 25: FY16 Overview
FY16 OVERVIEW SOLID RESULTS IN VOLATILE MARKETS FROM INCREASINGLY DIVERSIFIED BUSINESS For personal use only Solid Results NPAT up DPS up Initiatives showing 8% 6% momentum on FY15 on FY15 Perpetual Perpetual Perpetual Investments Private Corporate Trust delivers solid results and delivers six conse
Slide 26: Appendix
For personal use only APPENDIX
Slide 27: Investments: Global Equities
PERPETUAL INVESTMENTS GLOBAL EQUITIES For personal use only TARGET AUG GLOBAL SHARE FUND LAUNCH PROGRAM $1B FUM 2014 BY AUG 2017 People Consultants and Major platform Dealer Group Models and Retail and process researchers placements APLs multi channels channel engagement ON TARGET ON TARGET ON TARGE
Slide 28: Investments: Focus Within Multi Asset on Diversified Real Return Fund
PERPETUAL INVESTMENTS FOCUS WITHIN MULTI ASSET ON DIVERSIFIED REAL RETURN FUND For personal use only 2010 DIVERSIFIED REAL RETURN FUND LAUNCH PROGRAM Significant opportunity People Consultants and Major platform Dealer Group Models and Retail and process researchers placements APLs multi channels ch
Slide 29: Reclassification: Significant Items to Underlying Profit After Tax
RECLASSIFICATION SIGNIFICANT ITEMS TO UNDERLYING PROFIT AFTER TAX For personal use only FY16 FY16 FY16 Reclassification of For the period pre-adjustment adjustment reported $m $m $m realised gains or losses resulting from the Operating revenue 492.1 2.1 494.2 disposal of seed fund Total expenses (
Slide 30: Contacts
CONTACTS For personal use only Geoff Lloyd Level 18 Angel Place, 123 Pitt Street Chief Executive Officer & Managing Director SYDNEY NSW 2000 Australia [email protected] +612 9229 9078 Gillian Larkins Chief Financial Officer [email protected] +612 9229 3547 Neil Wesley Gener
Slide 31: Disclaimer
DISCLAIMER For personal use only Important information The information in this presentation is general background information about the Perpetual Group and its activities current as at 25 August 2016. It is in summary form and is not necessarily complete. It should be read together with the company’