Spheria Emerging Cos. Ltd. · ASX:SEC

Spheria Emerging Cos — Shareholder Meeting (November 2020)

13 slides from Spheria Emerging Cos's shareholder meeting presentation, Nov 26, 2020

  1. Slide 1: Amendment to Investment Manager Presentation

    Spheria Emerging Companies Limited Level 35, 60 Margaret Street Sydney NSW 2000 Telephone: 1300 010 311 Email: [email protected] ACN 621 402 588 For personal use only 26 November 2020 By Electronic Lodgement Market Announcements Office ASX Limited Exchange Centre 20 Bridge Street Sydney

  2. Slide 2: Annual General Meeting

    For personal use only Spheria Emerging Companies Limited ASX : SEC Annual General Meeting 25 November 2020

  3. Slide 3: Agenda

    2 For personal use only Agenda 1. SEC Company update 2. Smaller companies investing 3. Opportunities

  4. Slide 4: Spheria Emerging Companies (SEC.ASX)

    3 Spheria Emerging Companies (SEC.ASX) For personal use only • 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 (c

  5. Slide 5: Unintended Consequences

    4 Unintended Consequences For personal use only No. of stocks with EV/ Sales > 10x 200 160 120 80 40 0 • EV/Sales > 10 is expensive in historical context • Resource stocks, BNPL wannabes and speculative micro caps have inflated this bubble Chart Source: Bloomberg data, ASX stocks with market cap > $

  6. Slide 6: The Less You Earn, The More You Are Worth

    5 The Less You Earn, The More You Are Worth For personal use only Smaller Companies Average Return – Prior 12 Months 120 100 80 60 40 20 0 -20 -40 Positive Op CF Negative Op CF • Such is the upside down world we live in – negative operating cash flow outperformed Chart Source: Bloomberg data: simple

  7. Slide 7: However When the Weighing Machine Operates

    6 However When the Weighing Machine Operates For personal use only 20 Year Returns: Positive vs. Negative Cash Flow 800 700 600 500 400 300 200 100 0 -100 Positive Op CF Benchmark - Small Ordinaries Negative Op CF • Back tested portfolio of positive operating cash flow vs. negative operating cash fl

  8. Slide 8: SEC Performance

    7 SEC Performance For personal use only Company Performance* as at 31st October 2020 Since 1 month 6 month 1 year Inception Date Inception (p.a.) Company 1.8% 21.3% -2.5% 3.1% 30/11/2017 S&P/ASX Small Ordinaries 0.5% 15.1% -2.4% 3.3% Accumulation Index Outperformance +1.3% +6.2% -0.1% -0.2% * Compan

  9. Slide 9: Breville: The Sage of Europe

    Breville (ASX:BRG) 8 The Sage of Europe For personal use only Cash Flow Dynamics Return Metrics 120.0 100% 100% 86% 90% 90% 100.0 80% 80% 70% 80.0 70% 60% 60% 51%50% 60.0 50% 50% 44% 40% 39% 38%36%37%39%37% 40.0 40% 30% 28% 30% 20% 20%20%20% 18% 20.0 20% 15% 14%12%14% 13% 10% 10% 0.0 0% 0% FY01A FY0

  10. Slide 10: Company Positions

    9 Company Positions For personal use only SEC holdings as at 31 October 2020 Company Name % Portfolio Class Limited 5.0 Ht&E Limited 4.1 Breville Group Ltd 3.7 Mortgage Choice Ltd 3.5 Adbri Limited 3.5 Fletcher Building 3.4 Sims Limited 3.3 City Chic Collective 3.3 Technology One 3.2 Corp Travel Lim

  11. Slide 11: Outlook

    10 Outlook For personal use only • Continued momentum in Fintech and GAAP (growth at any price) continues to leave opportunity in cyclicals, travel related and smaller cap stocks. • Central Banks around the world have signaled continued interest in QE and further stimulus. • The IPO pipeline is now

  12. Slide 12: Thank you for joining us

    11 For personal use only Thank you for joining us SEC Shareholder Enquiries For general information and investment For investment enquiries please contact Pinnacle. enquiries please contact the Share Registry, Automic. T: 1300 288 664 T: 1300 010 311 E: [email protected] E: [email protected]

  13. Slide 13: Disclaimer

    12 Disclaimer For personal use only Note: Past performance is not a reliable indicator of future performance. Spheria Asset Management Pty Ltd (“Spheria”) ABN 42 611 081 326, a corporate authorised representative (No. 1240979) of Pinnacle Investment Management Limited (“PIML”) ABN 66 109 659 109, AF

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