Invesco Ltd · NYSE:IVZ
Invesco — Amvescap — Q2 2006 Earnings Presentation
24 slides from Invesco's earnings presentation, Jul 27, 2006
Slide 1: 2006 Second Quarter Results
AMVESCAP Helping people worldwide build their financial security 2006 Second Quarter Results Martin L. Flanagan, Chief Executive Officer Loren M. Starr, Chief Financial Officer July 27, 2006
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation may include statements that constitute “forward-looking statements” under the United States securities laws. Forward-looking statements include information concerning possible or assumed future results of our operations, earnings, liquidity, cash flow and
Slide 3: Agenda
Agenda Our Business Today Financial Results Questions and Answers Appendix 2
Slide 4: Summary of Second Quarter 2006 Results
Summary of Second Quarter 2006 Results Ending AUM of $413.8 billion, up $2.9 billion since the end of 1Q06 AUM 2Q06 average AUM of $414.6 billion, up $13.3 billion since 1Q06 Long term net flows of $2.3 billion were positive for the second consecutive quarter Quarterly Flows Continued sales
Slide 5: AMVESCAP - Quarterly Flows
AMVESCAP - Quarterly Flows Net flows were positive for the second consecutive quarter Redemption rate declined 1.7% due to lower institutional redemptions and a higher AUM In addition, money market assets increased $2.2 billion during the quarter to $61.3 billion Quarterly long-term flows Gros
Slide 6: Distribution Channels – Quarterly Flows
Distribution Channels – Quarterly Flows Institutional distribution channel net flow positive for the first time since 1Q05 and includes a $1 billion real estate portfolio acquisition Continuing positive net flows from retail channel Retail quarterly flows Institutional quarterly flows PWM quarte
Slide 7: AMVESCAP’s Current Investment Performance
AMVESCAP’s Current Investment Performance Retail % of AUM in Top Half of Peer Group 1yr 3yr 5yr Jun-06 Mar-06 Jun-06 Mar-06 Jun-06 Mar-06 US (Lipper) 69% 51% 60% 48% 44% 34% US (Morningstar) 69% 64% 67% 68% 60% 66% Canada 6% 4% 24% 21% 87% 76% UK 77% 66% 97% 94% 83% 88% Continental Europe 77% 64% 86
Slide 8: Financial Results
AMVESCAP Financial Results 7
Slide 9: Assets Under Management - Quarterly
Assets Under Management - Quarterly (in billions) 2Q06 1Q06 % Change 4Q05 3Q05 2Q05 Beginning Assets $410.9 $386.3 6.4% $380.5 $373.2 $375.4 Inflows 23.5 23.1 1.7% 15.8 15.7 17.6 Outflows (21.2) (21.6) (1.9)% (19.5) (20.0) (23.3) Net flows 2.3 1.5 53.3% (3.7) (4.3) (5.7) Net flows in Money Market 2.
Slide 10: Operating Results – Quarterly
Operating Results – Quarterly $ in Millions 2Q06 1Q06 % Change* 4Q05** 3Q05 2Q05 Management Fees 626 620 0.9% 574 556 543 Service and Distribution 133 136 (2.0)% 129 126 141 Other 29 27 7.8% 32 35 35 Total Revenues 788 783 0.7% 735 717 719 Third-party distribution, service and advisory fees (200) (1
Slide 11: Other Financial Highlights
Other Financial Highlights Capital Deployment Priorities f Reinvest in our business f Acquisitions when they makes sense f Dividends – steadily increase with no target payout ratio f Share repurchases Interim dividend of $0.077 – declared in $US for first time $300mn maturing debt in January 2
Slide 12: Questions and Answers
AMVESCAP Questions and Answers Marty Flanagan President and CEO, AMVESCAP Loren Starr CFO, AMVESCAP 11
Slide 13: Appendix
AMVESCAP Appendix 12
Slide 14: New Investment Product - PowerShares
New Investment Product - PowerShares Since June 2003, PowerShares Capital Management has grown from $60 million to $5.9 billion. We expect the transaction to close in 3Q06 Net inflows year-to-date through June were $2.6 bn and $0.4 bn in 2Q06 $7,000 $5,933 $6,000 $5,528 AUM ($millions) $5,000
Slide 15: Strength Through Diversification
Strength Through Diversification By Client Domicile By Channels By Asset Class Canada Equity 10% 44% U.K. Retail U.S. 14% 49% Balanced 60% 10% Institutional Alternatives Europe 6% 47% 10% Money Stable Value Market Asia PWM 11% 15% 6% 4% Fixed Income 14% U.S. $246.2B Institutional $195.0B Equity $183
Slide 16: Assets Under Management – 2Q06 By Channel
Assets Under Management – 2Q06 By Channel (in billions) Total Retail Institutional PWM March 31, 2006 $410.9 $202.9 $191.1 $16.9 Inflows 23.5 16.1 6.2 1.2 Outflows (21.2) (15.2) (4.6) (1.4) Net flows 2.3 0.9 1.6 (0.2) Net flows in Money Market 2.2 0.8 1.4 -- Funds and Other Market Gains/Reinvestment
Slide 17: Assets Under Management – 2Q06 By Asset Class
Assets Under Management – 2Q06 By Asset Class Equity Fixed Balanced Money Stable Alter- (in billions) Total Income Market Value natives March 31, 2006 $410.9 $188.3 $52.8 $41.2 $59.4 $46.1 $23.1 Inflows 23.5 9.4 8.1 2.0 0.4 1.2 2.4 Outflows (21.2) (11.8) (4.4) (2.4) (0.7) (0.6) (1.3) Net flows 2.3 (
Slide 18: Assets Under Management – 2Q06 By Client Domicile
Assets Under Management – 2Q06 By Client Domicile (in billions) Total U.S. Canada U.K. Europe Asia March 31, 2006 $410.9 $248.1 $43.3 $56.8 $37.8 $24.9 Inflows 23.5 8.8 0.9 3.0 7.3 3.5 Outflows (21.2) (10.3) (1.9) (2.3) (4.3) (2.4) Net flows 2.3 (1.5) (1.0) 0.7 3.0 1.1 Net flows in Money Market 2.2
Slide 19: Assets Under Management – YTD
Assets Under Management – YTD (in billions) June 30, 2006 June 30, 2005 % Change Beginning Assets $386.3 $382.1 1.1% Inflows 46.6 34.8 33.9% Outflows (42.8) (43.0) (0.5)% Net flows 3.8 (8.2) n/a Net flows in Money Market Funds 9.6 (1.4) n/a and Other Market Gains/Reinvestment 9.1 4.4 n/a Foreign cur
Slide 20: Assets Under Management – YTD By Channel
Assets Under Management – YTD By Channel (in billions) Total Retail Institutional PWM December 31, 2005 $386.3 $190.2 $179.8 $16.3 Inflows 46.6 32.5 11.7 2.4 Outflows (42.8) (29.6) (10.8) (2.4) Net flows 3.8 2.9 0.9 -- Net flows in Money Market 9.6 (0.2) 9.8 -- Funds and Other Market Gains/Reinvestm
Slide 21: Assets Under Management – YTD By Asset Class
Assets Under Management – YTD By Asset Class Fixed Money Stable Alter- (in billions) Total Equity Balanced Income Market Value natives December 31, 2005 $386.3 $177.1 $48.8 $40.4 $52.2 $45.7 $22.1 Inflows 46.6 21.9 14.1 4.0 1.0 2.2 3.4 Outflows (42.8) (25.7) (7.0) (5.0) (1.6) (1.6) (1.9) Net flows 3
Slide 22: Assets Under Management – YTD By Client Domicile
Assets Under Management – YTD By Client Domicile (in billions) Total U.S. Canada U.K. Europe Asia December 31, 2005 $386.3 $235.6 $42.2 $53.6 $32.0 $22.9 Inflows 46.6 16.3 2.1 5.9 15.1 7.2 Outflows (42.8) (20.2) (4.3) (4.7) (8.7) (4.9) Net flows 3.8 (3.9) (2.2) 1.2 6.4 2.3 Net flows in Money Market
Slide 23: Additional Income and Expense Information
Additional Income and Expense Information 2006 2005 ($ millions) 2Q06 1Q06 4Q05 3Q05 2Q05 1Q05 Operating items: Management fees – Performance fees 12.6 33.2 16.4 2.4 10.0 4.7 Compensation – Expenses related to -- -- -- (4.7) -- -- German Bank Compensation – Recruitment -- -- -- (11.8) -- -- Property
Slide 24: 2003 Performance Option Modeling highlights
2003 Performance Option Modeling highlights Year Accounting Standard EPS 2003 UK GAAP 23.2p 2006 IFRS “UK GAAP” Add back options expense and amortization of intangibles to forecasted 2006 IFRS EPS (≈$0.02) Calculation % Growth % of options exercisable** Below 12% 0% 2006 adjusted EPS 12%-13% 80% If