results for the year ended...8 direct private client net flow picking up private clients charities...

Results for the year ended30 September 2017

29 November 2017

2

Agenda

1

2

3

4

Introduction

Financial results

Strategy update

Q&A

David NicolChief Executive

Andrew WestenbergerFinance Director

3

Results highlights

3.85 4.25

9.1510.75

FY 2016 FY 2017

61.070.0

FY 2016 FY 2017

28.833.8

FY 2016 FY 2017

16.819.6

FY 2016 FY 2017

Total funds (£bn) Discretionary funds (£bn) Discretionary organic net inflows (£bn)

Adjusted* PBT (£m) Adjusted* diluted EPS (p) Full year dividend (p)

1.1

2.3

FY 2016 FY 2017

Growth rate +4%

35.440.1

FY 2016 FY 2017

* Excluding redundancy cost, onerous contracts, amortisation of client relationships, acquisition costs, incentivisation awards, one-off migration costs and disposal of available-for-sale investment.

+13% +17%

+17%+15%

Adjusted margin 21.6% 23.0%

+15%

15.0

13.0

Interim

Final

Growth rate +8%

4

Financial results

5

Financial headlines

£mFY

2016FY

2017Change

(%)

Total income 282.4 304.5 +8

Total operating costs (221.7) (234.5) +6

Adjusted operating profit 60.7 70.0 +15

Adjusted profit before tax* 61.0 70.0 +15

Statutory profit before tax 50.1 57.6 +15

Adjusted profit margin (%)Adjusted diluted EPS (p)Total dividend (p)

21.616.813.0

23.019.615.0

+17+15

Net cashCapital adequacy

170.8232%

170.0232%

--

Quarterly average MSCI Private Investor Balanced Index

1,368 1,535 +12


6

Strong funds growth

£bn

Total DirectTotal Intermediaries

Discretionary

Execution Only & BPS

Core funds

Advisory

Total funds

MSCI Private Investor Balanced Index

Net flows Acquired Investment performance

0.22.1

0.6-

1.50.6

2.3 0.6 2.1

(0.1) 0.1 0.0

2.2 0.7 2.1

(0.5) - 0.2

1.7 0.7 2.3

FY2017

23.410.4

33.8

3.6

37.4

2.7

40.1

1,545

Change (%)

Net flows Acquired Investment performance Total

+1+27

+3-

+7+8

+11+35

+8 +2 +7 +17

+7 +2 +6 +15

-10

+5 +2 +6 +13

+6

FY2016

21.17.7

28.8

3.6

32.4

3.0

35.4

1,457

7

Discretionary net inflow rate increasing, ahead of plan

Discretionary funds£bn

FY2016

FY2017

∆YoY

DirectIntermediariesMPS

1.00.90.5

1.01.50.9

Inflows 2.4 3.4 +1.0

DirectIntermediaries

(1.2)(0.3)

(0.9)(0.3)

Outflows (1.5) (1.2) +0.3

Transfers 0.2 0.1 -0.1

Total net flows 1.1 2.3 +1.2

Total Direct (inc. transfers)Total Intermediaries (inc.transfers)

-1.1

0.22.1

1.1 2.3

FY2015

Net flows Investmentreturns

Acquired FY2017

2 year growth in discretionary funds(£bn)

5 year discretionary target – 1/3 by 2020*(£bn)

427435 429

24.7 33.8

3.4

5.1 0.6

+14%

+21%

+2%

+37%

3.3

8.2

1.1

3.4

FY 2015 FY 2016 FY 2017 FY 2020

Target

Growth

* excludes acquired funds

8

Direct private client net flow picking up

Private Clients

Charities & Corporates

Total

18.916.9

0.2 1.3 0.5

FY2016

Net flowsExcl. transfers

Transfers Investmentreturns

Acquired FY2017

4.5

(0.1)

4.2

0.1 0.2 0.1

FY2016



Acquired FY2017

23.421.1

0.1 0.1 1.5 0.6

FY2016



Acquired FY2017

£bn

(1.1)(0.7)

0.3 0.30.5 0.6

(0.1) (0.2)

0.2 0.1

(1.2) (0.9)

1.0 1.0

FP integrated

Inflows

Outflows

FY 2016 FY 2017£bn (excl. transfers)

9

(0.3) (0.3) (0.3)0.3 0.5

0.90.8

0.9

1.5Bespoke

MPS

Bespoke

0.8 1.12.1

Strong, accelerating net inflows driving intermediary growth

0.6 1.22.3

5.36.5

8.1

0

2

4

6

8

10

12

FY 2015 FY 2016 FY 2017

Bespoke

MPS

5.9

7.7

10.4

Funds (£bn)FY 2015 FY 2016 FY 2017

Inflows

Outflows

TotalNet

flows

Product / service range helping drive IFA clients +25%

Depth and breadth to growth – bespoke inflows

62%19%

19%

24%

18%22%

36%1.35

0.1510% New IFAs

90% Existing

IFAs

£1.5bn

£bn

962

118

232 47344

194

1,025

24

46

FY 2015 FY 2017

+19%

+62%

+25%

Bespoke

MPS

Total number of IFAs 1,312 1,644

IFA size (£m) < 10 10-25 25-50 > 50

Total Intermediaries

funds

Total inflows 1.1 1.4 2.4

10

Strong fee growth, margin stabilising

£mFY

2016FY

2017Change

(%)

Direct Private ClientsDirect Charities & CorporatesIntermediaries - BespokeIntermediaries - MPS

165.919.746.02.9

176.421.855.35.3

+6+11+20+83

Total discretionary 234.5 258.8 +10

Financial planningExecution only / BPS

17.511.3

20.811.4

+19

Core income 263.3 291.0 +11

AdvisoryTrailInterest

15.71.51.9

12.90.00.6

-18

Total other 19.1 13.5 -29

Total income 282.4 304.5 +8

70 69 69 69

34 28 28 28

-40

10

60

110

FY 2016 H1 2017 H2 2017 FY 2017

Transactional volumes lower yoy, but stable

Fee margin stable, only tiering / mix will impact going forward

Commissions

Fees

Yield (bps)

174.8 203.1

59.755.7

0

100

200

FY 2016 FY 2017

Commissions

Fees

Strong discretionary fee growth, cushioning fall in commissions

Fees and Commissions£m

14 5 0 15 110

5

10

15

FY 2016 FY 2017

Core funds

growth

Incomegrowth

-7%

+16%

+10%234.5 258.8

Core income growth tracking towards asset growth

% growth

104 979797

11

Operating costs – headcount growth momentum increasing as looking to expand / add new capacity

£mFY

2016FY

2017Change

(%)

Staff costsNon-staff costs

103.569.5

110.271.8

+6+3

Operating costs 173.0 182.0 +5

Profit share 48.7 52.5 +8

Total costs 221.7 234.5 +6

Total staff compensation (%) 53.9 53.4

Profit share / pre profit share profit (%) 44.5 42.9

Non-staff costs (%) 24.6 23.6

50.6 49.651.1 52.4

1,6251,583 1,594 1,614

20

25

30

35

40

45

50

55

H1 2016 H2 2016 H1 2017 H2 2017

Headcount

Average headcount flat 1,604

Staff resource cost (£m)

Staff resource cost

100.2 103.5 Pay rises

Cost of sales / other

3.3 6.7 Higher sales & share price

related costs

Total staff costs

103.5 110.2

2016 2017

12

Achieved 25% operating margin target in Q4 2017

71.3 76.1 77.3 79.8

Adjusted operating margin (%)

FY 2017 Q1 Q2 Q3 Q4

69 75

21.1 22.8 22.9 25.0

Discretionary funds / CF30 (£m)

Total income (£m)

Strong second half organic inflows Successful integration of DLAM in Q3

Strong Q4 income growth Achieved £75m / CF30 efficiency metric, growth

utilised existing capacity

Further operational efficiencies to offset regulatory / inflationary cost pressure

Looking to increase investment and capacity for further business growth / innovation

Balance short term returns v long term value Operational scalability

Target

n/a n/a

13

Operating profit growth from Direct and Intermediary channels – efficient capacity utilisation

70.0

(4.5)

(2.8)

(5.1)

(2.3)

(0.9)

60.7

11.7

7.2

10.7

8.4

2.5

1.6

FY2016

Incrementalincome

Incrementalcosts of growth

Additionalcontribution

Central trail/ interest

Fixed costbase inflation

FY2017

£m

DLAM

Direct

Intermediary

Operating profit 24.9 (7.7) 17.2 (2.8) (5.1)

14

Cash flow

170.0170.8

FY2016

AdjustedEBITDA

Pensionfunding

Capex WorkingcapitalInc. FX

Interest& tax

Net sharepurchases

Dividends DLAMacquisition

DLAMacquisition

costs

Disposal oftrading

investments

Exceptionalitems

FY2017

£m85.2

(3.0) (2.0) (0.9)(9.7)

(5.3)

(36.6)

(2.4)(1.7)(25.5)1.1

DLAM acquisition – efficient utilisation of excess cash

232% Capital adequacy 232%

21% Return on total average equity 22%

15

Recap

Strong funds growth feeding into income growth

Pricing outlook stable in near term, mix / tiering effects only

Well positioned in high growth Intermediaries channel

Direct business growth starting to feed through

Balance sheet strength / optionality a source of value

Operational efficiency targets achieved, enables higher investment / innovation for growth

Planning c.100 additional net new hires over next 12 months

16

2017 strategy update

17

Strategy for organic growth

Understand our target clients and their changing needs

Refine proposition to meet those needs

Improve brand awarenessand promise

Enhance services to deliverthat promise

Refocus on distribution and leverage our scale in delivery

18

Core

Complex advice

WealthPilot

Our strategic agenda delivers growth and efficiency

FY 2

017

Prog

ress

WealthPilotWest End office & complex client needs

offerProfessional services

Propositions

Distribution management Intermediaries channelMarketing

Distribution

Change managementTarget operating modelTechnology (MyBrewin)MiFID II / GDPR / SMCR DLAM integrationLondon office

Operations

19

KPIs

Dividendgrowth

Adjusted** EPS growth (%) –diluted 15 11 7 (2) 17 n/a

Dividend growth (%) 20 15 21 8 15 n/a

Revenue growth

Discretionary fund inflows (%) 6 7 5 4 8 5

Net promoter score (%) n/a n/a n/a 45 48 42*

Overall client satisfaction (n/10) n/a n/a n/a 8.4 8.5 7.8*

Improvedefficiency

Adjusted** PBT margin (%) 19 21 22 22 23 25+

Discretionary funds per CF30 (£m) 41 48 53 64 75 75

Employee Engagement (%) n/a n/a 76 78 82 76*

Capital sufficiency Capital adequacy ratio (%) 226 241 248 232 232 Min

150

* Benchmark

** Excluding redundancy cost, onerous contracts, amortisation of client relationships, acquisition costs, incentivisation awards, one-off migration costs and disposal of available-for-sale investment

20

Outlook

2017 results evidence a business in great shape

New propositions enrich core offer

Intermediaries business a driver for growth

Significant progress behind strategy delivery

Prepared for increasingly challenging and competitive future – including MiFID II

Reinvesting for growth

21

Q&A

22

Appendices

23

Founded on a scalable platform for growth

Direct Indirect

Private Individuals IntermediariesCharities/ Corporates

Brewin Portfolio Service

- Risk rated model portfolios with no advice

clients

Managed Portfolio Service

- Actively managed risk rated model portfolio for

clients who receive advice from an intermediary

Wealth & Investment Management and Financial

Planning

- Full advice (from either a Brewin adviser or an intermediary)

- Caters for all clients’ needs- Full suite of solutions

WealthPilot

- Simplified, lower cost, telephone

based version of core service

Complex Client Offer

- New advice-led service to cater for clients with complex needs

In development

24

Statutory PBT

£mFY

2016FY

2017

Adjusted* profit before tax 61.0 70.0

Exceptional items

Amortisation of client relationships

(4.6)

(6.3)

(5.7)

(6.7)

Statutory profit before tax 50.1 57.6

Tax (11.1) (12.5)

Profit after tax from continuing operations 39.0 45.1

Profit after tax from discontinued operations 11.4 -

Statutory profit for the period 50.4 45.1

Statutory diluted earnings per share (EPS) (p)

from continuing operationsfrom discontinued operations

13.94.0

16.0-

Total diluted EPS 17.9 16.0


25

Balance sheet

£mFY

2016FY

2017

Goodwill & client relationshipsSoftware

71.49.6

90.55.3

Total intangible assets 81.0 95.8

Fixed assetsDefined benefit pensionOther non-current assets

4.8-

8.2

3.84.56.9

Total other non-current assets

13.0 15.2

Net cashWorking capitalProvisions

170.8(5.3)(3.1)

170.0(6.3)(3.8)

Total net current assets 162.4 159.9

Defined benefit pensionProvisions

(7.0)(6.6)

-(8.3)

Total non-current liabilities (13.6) (8.3)

Net assets 242.8 262.6

Regulatory capital resources 164.0 165.2

26

Cash flow

£mFY

2016FY

2017

Adjusted EBITDA 75.6 85.2

Pension fundingCapexWorking capital & FX movementInterest and taxationExceptional items and discontinued operationsShare movements – netAcquisition costsAcquisition of subsidiaryProceeds on disposal of trading investment

(3.0)(6.4)(0.1)(8.5)

2.7(6.5)

---

(3.0)(2.0)(0.9)(9.7)(2.4)(5.3)(1.7)

(25.5)1.1

Cash flow pre dividends 53.8 35.8

Dividends (32.8) (36.6)

Cash flow 21.0 (0.8)

Opening cash 149.8 170.8

Cash flow 21.0 (0.8)

Closing cash 170.8 170.0

27

Regional network

Discretionary funds

£bnFY

2016FY

2017Change

(%)

London / South East (incl. DLAM) 9.2 10.8 17

Scotland / Northern England 8.1 9.2 14

North West / Midlands 4.7 5.2 11

South / West & Wales 3.6 4.2 17

Other 2.0 2.1 5

Models 1.2 2.3 92

Total funds 28.8 33.8 17

28

Strong diversified discretionary inflows

0.1 0.2 0.3 0.50.9

0.50.6

0.70.8

0.9

1.5

0.9

1.41.4 1.0

1.0

1.0

(0.1) (0.2) (0.3) (0.3) (0.3)(0.4)

(0.9)(1.0) (1.0) (1.2)

(0.9)

Direct

Intermediaries

MPSInflows

Outflows

2012 2013 2014 2015 2016 2017

Total gross inflows (£bn) 1.4 2.1 2.3 2.1 2.4 3.4

Total gross outflows (£bn) (0.4) (1.0) (1.2) (1.3) (1.5) (1.2)

29

Net funds growth

0.5 0.50.7

0.3 0.2

0.5 0.50.5

0.5

0.6

1.1

0.1

0.2

0.30.5

1.0

0

0.5

1

1.5

2

2.5

Direct

Intermediaries

MPS

1.0 1.1 1.4 1.1 1.1 2.3

6.4 6.0 6.6 4.6 4.4 8.0

Net inflowsincluding transfers

(£bn)

Growth rate p.a. %

2012 2013 2014 2015 2016 2017

Total

30

Quality continues to improve

Fees 38

66 714

67

41

252210

27 1

2010 FY 2016 H1 2017

FP income

Commissions

Trail

Interest

Discretionary 51

82 84

16

10 933

8 7

Execution only

Advisory

Asset mix % Income profile %

FY2010

FY2016

FY2017

FY 2010

FY2016

FY2017

31

Fees and commissions

£mFY

2016FY

2017Change

(%)

FeesCommissions

174.859.7

203.155.7

+16-7

Discretionary 234.5 258.8 +10

BPS (Fees only) 0.9 1.0 +11

FeesCommissions

4.06.4

3.86.6

-5+3

Execution only 10.4 10.4 -

Core feesCore commissions

179.766.1

207.962.3

+16-6

Core fees and commissions 245.8 270.2 +10

FeesCommissions

10.84.9

9.13.8

-16-22

Advisory 15.7 12.9 -18

Total feesTotal commissions

190.571.0

217.066.1

+14-7

Total fees and commissions (excl. financial planning) 261.5 283.1 +8

32

Discretionary funds & income margin

FY 2016Average

funds

£bn

FY 2017Average

funds

£bn

FY 2016

Income

£m

FY 2017

Income

£m

Change

%

FY 2016Average

margin

bps

FY 2017Average

margin

bps

Direct 19.9 22.6 Fees 127.8 144.1 13% 64.3 63.7

YoY change 14% Commissions 57.8 54.1 29.1 23.9

185.6 198.2 7% 93.4 87.6

Intermediaries 5.9 7.5 Fees 44.1 53.7 22% 74.6 71.9


46.0 55.3 20% 77.7 74.1

MPS 1.0 1.9 Fees 2.9 5.3 83% 29.5 27.7

YoY change 90%

Total discretionary 26.8 32.0 Fees 174.8 203.1 16% 65.3 63.5


234.5 258.8 10% 87.6 80.9

33

Total funds & income margin

FY 2016Average

funds

£bn

FY 2017Average

funds

£bn

FY 2016

Income

£m

FY 2017

Income

£m

FY 2016Average

margin

bps

FY 2017Average

margin

bps

Discretionary 26.8 32.0 234.5 258.8 88 81

YoY change 5% 19% 4% 10% (1%) (8%)

BPS 0.1 0.1 0.9 1.0 70 70

YoY change 0% 0% 0% 11% 0% 0%

Execution only 3.6 3.4 10.4 10.4 29 30

YoY change 0% (6%) 3% 0% 2% 3%

Advisory 3.2 2.8 15.7 12.9 49 46

YoY change (27%) (13%) (36%) (18%) (14%) (6%)

Total 33.7 38.3 261.5 283.1 78 74

YoY change 1% 14% 1% 8% 0% (5%)

34

Asset allocation - balanced

Asset class

MSCI* Balanced

%

BD Balanced

%

Cash 5.0 4.0

GiltsCorporate bondsUK index linked bonds (O/B)

5.017.52.5

4.515.52.0

Bonds 25.0 22.0

UKNorth AmericaDev’d Europe ex UKJapanAsiaAdv. EmergingEmerging

Overseas

30.012.93.62.02.90.90.2

22.5

30.514.04.52.03.51.00.5

25.5

Equities 52.5 56.0

Hedge fundsUK commercial propertyAbsolute return (O/B)

12.55.00.0

0.03.5

14.5

Alternatives 17.5 18.0

Total 100.0 100.0

* MSCI WMA Private Investor Balanced Index

35

Dividend / EPS history

3.55 3.55 3.65 3.75 3.85 4.25

3.60 5.05 6.258.25 9.15

10.75

12.1

14.416.0

17.1 16.8

19.6

2012 2013 2014 2015 2016 2017

Interim dividend (p)

Final dividend (p)7.15

8.609.90

12.0013.00

Adjusted* diluted EPS (p)

CAGR 16%15.00


36

Major shareholders as at 10 November 2017

% holding

Royal London Asset Mgt 5.60

Aberforth Partners 5.34

JO Hambro 5.29

Kabouter Mgt 4.50

Aviva Investors 4.13

Other* 75.14

* of which Brewin Dolphin staff and former staff including Employee Share Ownership Trust

16.10

37

Disclaimer

The information contained in this document has been prepared by Brewin Dolphin Holdings PLC (the "Company"). No representation or warranty, express orimplied, is or will be made as to, or in relation to, and no responsibility or liability is or will be accepted by the Company or by any of its affiliates or agents asto or in relation to, the accuracy or completeness of this document or any other written or oral information made available to or publicly available to anyinterested party or its advisers, and any liability therefore is expressly disclaimed. Notwithstanding the aforesaid, nothing in this paragraph shall excludeliability for any undertaking, representation, warranty or other assurance made fraudulently.

This document does not constitute or form part of any offer for sale or solicitation of any offer to buy or subscribe for any securities in the Company nor shall itor any part of it form the basis of or be relied on in connection with, or act as any inducement to enter into, any contract or commitment whatsoever. Noreliance may be placed for any purpose whatsoever on the information or opinions contained in this document, the presentation or on the completeness,accuracy or fairness.

Certain statements in this document are forward-looking statements which are based on the Company's expectations, intentions and projections regarding itsfuture performance, anticipated events or trends and other matters that are not historical facts. These forward-looking statements, which may use words suchas "aim", "anticipates", "believe", "intend", "estimate", "expect" and words of similar meaning, include all matters that are not historical facts. These forward-looking statements involve risks and uncertainties that could cause the actual results of operations, financial condition, liquidity, dividend policy and thedevelopment of the industry in which the Company's business operates to differ materially from the impression created by the forward-looking statements.These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors that could causeactual results to differ materially from those expressed or implied by such forward-looking statements. Given these risks and uncertainties, prospectiveinvestors are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of such statementsand, except as required by the FCA, the London Stock Exchange or applicable law, the Company undertakes no obligation to update or revise publicly anyforward-looking statements, whether as a result of new information, future events or otherwise.

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (orany other website) is incorporated into, or forms part of this document.

29 November 2017

38

12 Smithfield Street, London, EC1A 9LATel: 020 3201 3900Email: [email protected]://www.brewin.co.uk

results for the year ended...8 direct private client net flow picking up private clients charities...

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