schroders18 2016 h1 results | 28 july 2016 £m net operating revenue net (losses)/gains on financial...
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Schroders 2016 H1 Results
Data Pack July 2016
Schroders
Contents
1 2016 H1 Results | 28 July 2016
Nothing in this presentation should be construed as a forecast, estimate or projection of future financial performance
Page
Assets under management (AUM) 2
Regional diversification of AUM 3
Gross sales and net flows 4-5
Currency profile of AUM 6-7
AUM diversification 8-10
Asset Management AUM – detailed asset class analysis 11-13
Asset Management AUM flows 14-15
Net operating revenue and margins – Asset Management 16
Income statement progression 17-19
Cost and return metrics 20
Movement in capital 21
Group capital allocation 22
Schroders
Assets under management (AUM) £343.8 billion at 30 June 2016
2 2016 H1 Results | 28 July 2016
* Relates to a transfer of Charities assets from Asset Management to Wealth Management
£bn Institutional Intermediary Asset Management Wealth Management Total
1 January 2016 181.0 100.9 281.9 31.6 313.5
Net flows 4.4 (3.3) 1.1 (0.4) 0.7
Investment returns 19.1 8.8 27.9 1.7 29.6
Transfers* (0.9) - (0.9) 0.9 -
30 June 2016 203.6 106.4 310.0 33.8 343.8
Schroders
Regional diversification of AUM* 63% of net operating revenues outside UK
3 2016 H1 Results | 28 July 2016
* By client domicile
North America
£38.6bn
South America
£7.5bn
Continental Europe
£63.2bn
UK
£135.5bn
Asia Pacific
£89.2bn Middle East & Africa
£9.8bn
Schroders
Gross sales
4 2016 H1 Results | 28 July 2016
£bn
25.6
23.0
15.6
19.9 21.3
17.9
0.0
10.0
20.0
30.0
Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016
Equities Fixed Income Multi-asset Emerging Market Debt, Commodities & Real Estate Wealth Management
Schroders
Net flows
5 2016 H1 Results | 28 July 2016
£bn
5.1
3.7
(0.5)
4.7
2.7
(2.0)
(10.0)
(5.0)
0.0
5.0
10.0
Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016
Equities Fixed Income Multi-asset Emerging Market Debt, Commodities & Real Estate Wealth Management
Schroders
Currency profile of AUM Assets under management £343.8 billion
6 2016 H1 Results | 28 July 2016
* Includes the following currencies which individually constitute 1% of AUM: INR, SGD, BRL
** USD includes other currencies pegged to USD, including HKD
32%
28%
12%
5%
5%
4%
2% 2%
2% 2%
6%
USD** GBP EUR AUD JPY CNY TWD CHF KRW IDR Other*
Schroders
Institutional £203.6bn Intermediary £106.4bn Wealth Management £33.8bn
Currency profile of AUM Assets under management £343.8 billion
7 2016 H1 Results | 28 July 2016
* USD includes other currencies pegged to USD, including HKD
USD*GBPEURAUDJPYCNYTWDKRWCHFOther
34%25%9%
2%4%5%7%
2%2%
10%
USD*EURGBPJPYCNYAUDIDRTWDSGDCHFOther
32%19%18%
3%3%4%7%
2%2%
2%
8%
GBPUSD*EURCHFOther
73%18%6%
1%2%
Schroders
By channel By region* By product
Total AUM by channel, region and product Assets under management £343.8 billion
8 2016 H1 Results | 28 July 2016
* By client domicile
59%
31%
10%
Institutional
Intermediary
Wealth Management
40%
21%
26%
13%
UK
Continental Europe, Middle East & Africa
Asia Pacific
Americas
40%
21%
25%
4%
10%
Equities
Fixed Income
Multi-asset
Emerging Market Debt, Commodities & Real Estate
Wealth Management
Schroders
Institutional AUM £203.6bn Intermediary AUM £106.4bn
Asset Management AUM by channel and product
9 2016 H1 Results | 28 July 2016
39%
24%
31%
6%
Equities Fixed Income
53%
23%
21%
3%
Multi-asset Emerging Market Debt, Commodities & Real Estate
Schroders
Institutional AUM £203.6bn Intermediary AUM £106.4bn
Asset Management AUM by channel and region*
10 2016 H1 Results | 28 July 2016
* By client domicile
40%
15%
28%
17%
UK Continental Europe, Middle East & Africa
25%
35%
29%
11%
Asia Pacific Americas
Schroders
Asset Management AUM – detailed asset class analysis Assets under management £310.0 billion
11 2016 H1 Results | 28 July 2016
Equities £136.8bn
Asia Pacific
Quantitative equities
Global
Emerging markets
UK
Europe
Japan
US
Australia
Other
18%
16%
1%
4%
6%
5%
12%
13%
13%
12%
US
Europe
Global
UK
Asia Pacific
Australia
Convertibles
Insurance-linked
33%
20%
2%
2%
7%
6%
7%
23%
Fixed Income £73.4bn
Risk controlled growth
LDI
UK traditional balanced
Income
Inflation protection
Risk mitigation
GAIA
Wealth preservation
22%
41%
1%
16%8%
Multi-asset £85.7bn
5%
3%
4%
Real estate
Emerging market debt
Agriculture and commodities
Private equity
74%
13%
5%
8%
Emerging Market Debt, Commodities and Real Estate £14.1bn
Schroders
Institutional AUM – detailed asset class analysis Assets under management £203.6 billion
12 2016 H1 Results | 28 July 2016
Equities £80.4bn
Quantitative equities
Emerging markets
Global
Asia Pacific
UK
Europe
Australia
Japan
US
24%
17%
3%
5%
8%
9%
15%
16%
3%
US
Global
Europe
UK
Asia Pacific
Australia
Convertibles
Insurance-linked
46%
19%
1%
1%
7%
4%
13%
9%
Fixed Income £48.4bn
Risk controlled growth
LDI
UK traditional balanced
Inflation protection
Risk mitigation
Wealth preservation
31%
38%
3%
21%
Multi-asset £63.4bn
6%
1%
Real estate
Emerging market debt
Agriculture and commodities
Private equity
78%
7%
5%
10%
Emerging Market Debt, Commodities and Real Estate £11.4bn
Schroders
Intermediary AUM – detailed asset class analysis Assets under management £106.4 billion
13 2016 H1 Results | 28 July 2016
Europe
Global
US
Australia
Asia Pacific
Convertibles
UK
Insurance-linked
42%
22%
2%
3%
4%
8%
10%
9%
Fixed Income £25.0bn
Risk controlled growth
Income
GAIA
Risk mitigation
Inflation protection
47%
11%
32%
Multi-asset £22.3bn
4%
6%
Real estate
Emerging market debt
Agriculture and commodities
Private equity
56%
27%
2%
15%
Emerging Market Debt, Commodities and Real Estate £2.7bnEquities £56.4bn
Asia Pacific
Europe
UK
Japan
Global
Emerging markets
US
Quantitative equities
Australia
Other
23%
15%
4%
4%
5%
9%
7%
7%
9%
17%
Schroders
Institutional Assets under management: £203.6 billion
14 2016 H1 Results | 28 July 2016
9.3
7.4
4.9
10.4 10.6
7.3
(7.3)
(5.8)(5.0) (5.1)
(6.1)(7.4)
2.0 1.6
(0.1)
5.3 4.5
(0.1)
(10.0)
(5.0)
0.0
5.0
10.0
15.0
Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016
£bn
Gross inflows Gross outflows Net flows
Schroders
Intermediary Assets under management: £106.4 billion
15 2016 H1 Results | 28 July 2016
14.7 13.9
9.6 8.4
9.5 9.3
(11.8) (12.0)
(9.8)(8.7)
(11.3) (10.8)
2.9 1.9
(0.2) (0.3)(1.8) (1.5)
(15.0)
(10.0)
(5.0)
0.0
5.0
10.0
15.0
20.0
Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016
£bn
Gross inflows Gross outflows Net flows
Schroders
Net operating revenue and margins – Asset Management Asset Management Net operating revenue £687.8 million
16 2016 H1 Results | 28 July 2016
* Excludes exceptional items
Performance fees - £m
Performance fees on average AUM
Net operating revenue (ex performance fees) - £m
Net operating revenue (ex performance fees) on average AUM
Net income* - £m
Operating expenses* - £m
Profit before tax* - £m 257.6 540.5 271.0
460.6 872.0 431.1
47 bps49 bps 49 bps
1,412.5 702.1 718.2
681.4 1,357.7 687.0
0 bps1 bps 1 bps
6.4 35.7 5.9
H1 2016FY 2015 H1 2015
Schroders
Income statement progression Asset Management profit before tax
17 2016 H1 Results | 28 July 2016
£m
Institutional
Intermediary
Net operating revenue
Net gains/(losses) on financial instruments and other income
Share of profit of associates and joint ventures
Net income
Operating expenses
Asset Management profit before exceptional items
Exceptional items
Asset Management profit after exceptional items
Q2 2016
163.4
188.6
352.0
13.0
3.3
368.3
(238.6)
129.7
(5.0)
124.7
Q3 2015
146.5
192.6
339.1
(213.5)
(0.2)
4.0
129.4
342.9
Q2 2015
156.3
197.3
353.6
(214.7)
(3.1)
126.3
Q1 2016
152.7
183.1
335.8
8.9
5.2
349.9
(222.0)
127.9
(3.5)
124.4
Q1 2015
152.7
186.6
339.3
(216.4)
137.3
(3.0)
134.3
133.7
(3.0)
130.7
4.4
(6.0)
2.3
350.1 352.0
8.5
(3.0)
137.1
Q4 2015
173.2
188.2
361.4
(227.4)
4.0
2.1
140.1
367.5
Schroders
Income statement progression Wealth Management profit before tax
18 2016 H1 Results | 28 July 2016
£m
Net operating revenue
Net (losses)/gains on financial instruments and other income
Net income
Operating expenses
Wealth Management profit before exceptional items
Exceptional items
Wealth Management profit after exceptional items
Q2 2016
55.2
0.4
55.6
(38.9)
16.7
(2.0)
14.7
0.2
49.9
51.9
(35.3)
16.5
5.2
21.7
(0.1)
Q1 2016
51.9
0.1
52.0
(36.3)
15.7
(2.0)
13.7
Q4 2015
49.7
(35.1)
(2.0)
12.8
51.8
Q2 2015
53.3
Q3 2015
13.0
52.4
(37.3)
(1.9) (2.1)
Q1 2015
14.8
(0.2) -
14.9
13.0
(38.2)
52.2 53.3
15.1
Schroders
Income statement progression Group segment (loss)/profit before tax
19 2016 H1 Results | 28 July 2016
* Includes RWC Partners Limited and Schroder Ventures Investments Limited associates
£m
Net gains on financial instruments and other income
Share of profit of associates*
Net income
Operating expenses
Group profit before exceptional items
Exceptional items
Group (loss)/profit after exceptional items
(5.8)
2.8
2.2
5.0
0.9
(1.1)
(0.2)
(8.9)
Q2 2016
11.8
Q1 2016
8.0
1.8
9.8
6.8
1.8
8.6
Q3 2015
8.2
7.2
1.0
Q4 2015
0.2
3.7
7.9
1.0
6.7
Q1 2015
(6.9)
1.2
1.6
(1.0)
0.6
(2.4)
10.9
5.7
5.2
(10.2)
11.0
0.8
1.6
(1.4)
(6.6)
Q2 2015
(7.2)
(3.0)
(2.0) 1.3
Schroders
Cost and return metrics Total Schroders Group costs
20 2016 H1 Results | 28 July 2016
* Excludes exceptional items
** Costs and income are subject to adjustments by the remuneration committee
2015 H1 2015 H1 2016
Total compensation ratio* 44% 44% 45%
Headcount 3,784 3,685 3,866
Total costs* 1,048.8 520.7 550.5
Total cost ratio* 63% 63% 65%
Return on average capital
(pre-tax)* 23% 24% 21%
Return on average capital
(post-tax)* 18% 19% 16%
► Total compensation ratio
= compensation costs divided by net income**
► Total cost ratio
= costs divided by net income
► Return on average capital (pre-tax)
= profit before tax divided by average capital
► Return on average capital (post-tax)
= profit after tax divided by average capital
Schroders
Movement in capital
21 2016 H1 Results | 28 July 2016
£m 2016
1 January 2016 2,795.6
Profit before tax and exceptional items 293.7
Exceptional items (11.4)
Net movement arising from AFS financial assets 2.6
Exchange differences on translation of foreign operations after hedging 74.1
Actuarial gain on defined benefit pension schemes 27.2
Tax (68.0)
Own shares purchased (49.2)
Share-based payments 28.9
Dividends paid (157.7)
Other (6.8)
30 June 2016 2,929.0
Schroders
Group capital allocation Increase of £133 million for the six months ended 30 June 2016
22 2016 H1 Results | 28 July 2016
* Includes RWC Partners Limited and Schroder Ventures Investments Limited associates
** Comprises goodwill, intangible assets, pension scheme surpluses, other associates and joint ventures, and deferred tax
£m
December
2015
June
2016
Regulatory capital 653 687
Other operating capital 253 165
Investment capital* 942 1,070
Seed capital 229 246
Other** 719 761
Statutory Group capital 2,796 2,929