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Invesco
June 6, 2008
Sandler O’Neill Global Exchange and Electronic Trading Conference
Colin Meadows, CAO
22
Forward-Looking StatementsThis 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 capital expenditures, industry or market conditions, assets under management, acquisition activities and the effect of completed acquisitions, debt levels and the ability to obtain additional financing or make payments on our debt, regulatory developments, demand for and pricing of our products and other aspects of our business or general economic conditions. In addition, when used in this release, words such as "believes," "expects," "anticipates," "intends," "plans," "estimates," "projects" and future or conditional verbs such as "will," "may," "could," "should," and "would" and any other statement that necessarily depends on future events, are intended to identify forward-looking statements.
Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Although we make such statements based on assumptions that we believe to be reasonable, there can be no assurance that actual results will not differ materially from our expectations. We caution investors not to rely unduly on any forward-looking statements. In connection with any forward-looking statements, you should carefully consider the areas of risk described in our most recent Annual Report on Form 10-K and any subsequent Quarterly Reports on Form 10-Q, as filed with the United States Securities and Exchange Commission (“SEC”). You may obtain these reports from the SEC’s Web site at www.sec.gov. We expressly disclaim any obligation to update any of the information in this or any other public disclosure if any forward-looking statement later turns out to be inaccurate, whether as a result of new information, future events or otherwise.
3
Mission: Helping people worldwide build their financial security
Who We AreA global leader in investment management
We’re one of the world’s leading independent global investment management firms.
We draw on the strength of many resources:— $470.3 (U.S.) billion in assets under management— Client support in 20 countries serving clients in more than 100 countries— 13 specialized investment centers— More than 5,000 employees worldwide— More than 500 investment professionals
We deliver on a single focus: investment management.
We have the leadership, resources and integrity to look after our clients’ interests:
— Long history of managing assets for clients on a global basis— Publicly traded on New York Stock Exchange with $10.3 billion in
market capitalization
All data as of March 31, 2008, unless otherwise noted. Source: Invesco Ltd.
4
2007-2008 Summary Industry Trends
We Identified A Set of Key Trends That Appear To Be Shaping The Future of Our Industry
Shifting Demographics… ageing population in developed world increasing focus on retirement assets
Total Relationship Focus… sophisticated global distributors looking at multiple factors in addition to investment performance
Separation of Alpha & Beta… continued acceptance and growth of “alternatives”, ETF’s, and structured products
Globalization of Investment Markets… steady growth in “established” markets augmented by rapid growth in demand from “emerging” markets
Scale and Relevance… asset flows and operating efficiency appear to benefit from increased scale and relevance to distributors
War for Talent… effectiveness in developing and retaining high performance organization increasingly critical to long term success
5
The Markets Are Global and So is Our Company
Our Aspiration: Take advantage of
our world of opportunityto become a premier
global investment management firm
Unlock the power of our global operating platform
2 Deliver our investment capabilities anywhere in the world to meet client needs
Achieve strong investment performance
1
Build a high- performance organization
4
3
Our Strategic Priorities
6
The Value We Deliver to Our Clients
1 Commitment to investment excellenceClearly articulated investment disciplines aligned with client expectations and underpinned by diligent oversight and rigorous quality control processes
2 Specialized investment expertise globallyDistinctive investment teams designed around unique asset class, product or regional expertise
3 Diversified strategiesInvestment solutions across all major equity, fixed-income and alternative asset classes
4 Multiple delivery vehiclesInvestment strategies delivered to clients through various packaging options
5 Global reachDistributional and operational strength and breadth to deliver solutions independently and objectively through local knowledge and brands
7
Commitment to Investment Excellence
A focus on delivering investment quality is inherent to our mission.
Achieving strong investment performance is our top strategic priority.
Our operating structure puts investments at the heart of our activity for the benefit of our clients.
We’re dedicated to attracting and retaining top investment talent.
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Specialized Investment Capabilities Globally Investment management team networkEach of Invesco’s investment centers adheres to clearly defined investment strategies and philosophies intended to align with client expectations. Harnessing the distinct expertise at each center, Invesco’s teams draw on the strength of global resources and independent vision provided by:
Invesco Aim
Houston Austin Denver San Francisco Investment focus: U.S., international and global equities
Investment Prof: 75
AUM: $66.4 billion
Aim Trimark
Toronto Investment focus: Canadian equities, global equities, int’l equities and fixed incomeInvestment Prof: 27
AUM: $36.9 billion
Invesco Asia-Pacific
Melbourne Tokyo Hong Kong Taipei, Taiwan Shenzhen, China Investment focus: Asian Ex-Japanese, Greater Chinese, Japanese and Australian equities
Investment Prof: 61
AUM: $26.4 billion
Invesco Global Equity
Atlanta Investment focus: Global and international equities
Investment Prof: 19AUM: $14.1 billion
Invesco Real EstateDallas New York San Francisco Atlanta Newport Beach London Munich Hong Kong Prague Paris Madrid Investment focus: Global direct real estate investing and public real estate investing
Investment Prof: 106
AUM: $26.3 billionInvesco PowerShares
Chicago Investment focus: ETFs
Investment Prof: 7AUM: $12.9 billion
Atlantic Trust
Boston Atlanta Chicago New York Investment focus: High-net-worth multimanagement
Investment Prof: 31
AUM: $16.6 billion
Invesco Multiple-Asset Strategies
Atlanta Investment focus: Global overlay strategies and tactical asset allocation
Investment Prof: 6
AUM: $3.2 billion
Invesco Perpetual
Henley
Investment focus: U.K. equities, fixed income and European equities
Investment Prof: 43
AUM: $73.3 billion
Invesco Private Capital
New York Denver San Francisco Investment focus: Fund of funds and venture capital private equities
Investment Prof: 10
AUM: $2.4 billion
WL Ross & Co.
New York Tokyo Mumbai Investment focus: Distressed and restructuring private equities
Investment Prof: 13
AUM: $6.7 billion
Data as of March 31, 2008
Note: The listed centers do not all provide products or services that are available in the U.S., nor are their products and services available on all platforms. Not all of the Invesco brands listed are available in all countries, nor are they available on all platforms. Please consult with your Invesco representative for more information on any of our brands mentioned. Source: Invesco Ltd.
• The stability of $470 billion in assets under management (AUM)
• More than 500 investment professionals worldwide• Investment centers operating in 25 cities in 12
countries• Client support in 20 countries• The value of a single focus — managing our clients’
money
Invesco Quantitative Strategies
New York Boston Frankfurt Investment focus: Quantitative active, enhanced and long/short strategies
Investment Prof: 56
AUM: $28.6 billion
Invesco Worldwide Fixed Income
Louisville Houston New York London Frankfurt Melbourne Investment focus: Money market, stable value, global fixed income and alternatives/financial structuresInvestment Prof: 120AUM: $156.5 billion
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• Institutional separate accounts• Collective trusts• Mutual funds (onshore &
offshore)• Exchange-traded funds (ETFs)• Private placements• Sub-advised• SMA/UMA• Variable insurance funds
Delivered the Way Our Clients Want
Invesco Delivers Investment Strategies That Meet Our Clients’ Diverse Needs
Diversified Investment Strategies
Equity • Market cap• Investment style• Global/regional/single
country• Developed/Emerging• Sector• Quantitative
Asset Allocation• Traditional balanced• Target maturity• Target risk
Fixed Income and Cash• Duration• Quality• Sector• Global/regional/single
country• Developed/Emerging• Taxability
Alternatives• Real Estate
– Public real estate securities– Private direct real estate– US, Asian, European, Global
• Private Equity– Direct
Distressed– Fund of Funds
Buyout, VC, Emerging• Absolute Return
− Market Neutral− GTAA− Active Currency− Multi-strategy− Alternative Beta
• Directional Long/Short (130/30)• Financial Structures
− CDO/CLO/CSO− Opportunistic
• Commodities/ Natural Resources• Customized solutions
− Portable alpha− Liability-driven
10
13%
19%8%
46%
6%
8%
Strength Through Diversification – AUM By Asset Classes
$215.2B
$37.2B
$87.3B
$40.2B
$30.2B
$60.2B
$470.3BTotal
Equities
Money Market
Fixed Income
Stable Value
Alternatives
Equity
Balanced
Money Market
Fixed Income
Stable Value
Alternatives
5%
13%11%
46%
12%
13%
Equities
Money Market
Fixed Income
Stable Value
Alternatives
$177.5B
$41.2B
$50.3B
$49.3B
$46.8B
$21.2B
$386.3BTotal
Equity
Balanced
Money Market
Fixed Income
Stable Value
Alternatives
21%
(10%)
74%
(18%)
(35%)
184%
22%
2005-08 change
Balanced Balanced
March 31, 2008 AUM – $470.3BDecember 31, 2005 AUM – $386.3B
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Strength Through Diversification – AUM By Channels
$224.8B
$228.7B
$16.8B
$470.3BTotal
Institutional
Retail
High Net Worth
$179.8B
$190.2B
$16.3B
$386.3BTotal
Institutional
Retail
High Net Worth
25%
20%
3%
22%
2005-08 change
48%49%
3%
49%
4%
47%
Retail**
Institutional*
High Net Worth
Institutional*
Retail**
* Includes separate accounts, collective funds, and investment trusts, includes the AIM Institutional cash assets** Includes open-end funds, closed-end funds, wrap account, and sub-advised accounts 100
March 31, 2008 AUM – $470.3BDecember 31, 2005 AUM – $386.3B
High Net Worth
12
Strength Through Diversification – AUM By Client Domicile
$281.7B$81.8B$33.0B$42.1B$31.7B
$470.3BTotal
United StatesUnited KingdomEuropeCanadaAsia
$235.6B$53.6B$32.0B$42.2B$22.9B
$386.3BTotal
United StatesUnited KingdomEuropeCanadaAsia
19%53%
3%(0.2)%
38%
22%
2005-08 change
7%
9%
60%
7%
17%
5%
11%
62%
8%
14%
United States
United
Kingdom
Canada
Asia
EuropeUnited States
United
Kingdom
Canada
Asia
Europe
March 31, 2008 AUM – $470.3BDecember 31, 2005 AUM – $386.3B
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A Leader in Global Investment Management
0 10 20 30 40 50 60
Wellington
Morgan Stanley
Pyramis
Loomis, Sayles
TCW
PIMCO
ING
Franklin Templeton
Western Asset
State Street Global
BlackRock
Goldman Sachs
Alliance Bernstein
J.P. Morgan
Barclay's
AIG
Invesco
Lazard
%
Source: eVestment Alliance, Empirical Research Partners Analysis.
Large U.S.-Based Asset Managers With Global Client Bases Share of Client Assets From Outside the U.S. As of Year-End 2007
Invesco
14
Invesco is positioned to capture assets in key markets
*Source: Cerulli. Data as of June 30, 2007. The top 10 markets listed are those with the highest projected 2011 AUM. Includes mutual fund and retirement assets only.**Source: Invesco Ltd. Data as of March 31, 2008. ***All asset figures provided in US Dollars
Top 10 Markets with Highest Projected Assets Available to Outside Managers
$34,866
$6,510
$2,116
$1,877
$1,804
$1,669
$1,630
$1,560
$1,043
$878
($ b
illi
on
s)
2006–2011 Country 2011 AUM(E) CAGR (E) Invesco Presence**
8.9%
8.9%
11.3%
6.8%
8.7%
6.2%
8.9%
5.7%
5.9%
9.9%
1515
Annual Long-Term and Institutional Money Market Flows
66.385.8
119.9
20.8
-82.5 -87.2
-29.2
-123.3
-$8.4-$3.4-$16.2
-$1.4
-140
-90
-40
10
60
110
2005 2006 2007 1Q08YTD
Gross sales
Gross redemptions
Net sales
Annual Long-Term Flows ($ billions) Growth in Institutional Money Market ($ billions)
* Stable value excluded beginning April 1, 2007
80.774.4
60.6
47.8
9.610.612.8
0.60
10
20
30
40
50
60
70
80
90
2005 2006 2007 1Q08 YTD0
5
10
15
20
25
30
16
Below Benchmark 3Qtl or 4Qtl
30%
Above Benchmark
1Qtl and 2Qtl70%
Above Benchmark
1Qtl and 2Qtl72%
Below Benchmark 3Qtl or 4Qtl
28%
Investment Performance – OverviewAsset Weighted 3-Year Performance
Rated AUM as of March 31, 2008 was $358.8bn. Rated AUM as of December 31, 2007 was $380.0 billion. Unrated assets as of March 31, 2008 $112.6bn: Private Wealth: 17bn, CDOs: 13bn, US Institutional: 7bn, Private Equity: 5bn, Real Estate : 22bn, Stable Value + Div. FI: 30bn, SPG 8bn, Other assets: 10bn
Includes rated AUM of $380.0bn
December 31, 2007
Includes rated AUM of $358.8bn
March 31, 2008
17
Improving Operating Results
386
463
500470
300
350
400
450
500
550
2005 2006 2007 YTD1Q08
Assets and Flows
IVZ % Change(06/30/05 – 03/30/08)
Assets under management and Net Flows ($ billions)
228
994
759
408
2005 2006 2007 YTD1Q08
Operating income ($ millions) Net Operating margin* (%)
35.936.032.5
23.0
2005 2006 2007 YTD1Q08
Net Flows ($bn)
$(16.2) ($1.4) ($3.4) $(8.4)*
*See the Schedule of Non-GAAP Information in the appendix of this presentation for a reconciliation of net operating margin to the most directly comparable US GAAP financial measure.
0%
25%
50%
75%
100%
125%
150%
175%
2005 2006 2007
18
Well Positioned for Growth
Invesco is a strong global firm
We are building real momentum in terms of:— Investment performance— Assets and flows— Business performance
Delivering the combined power of our distinctive worldwide investment management capabilities adds substantial value for our clients
We are committed to achieving investment excellence
Led by a powerful strategy …that delivers on our aspiration to become a premier global investment management organization
Questions & Answers
June 6, 2008
Sandler O’Neill Global Exchange and Electronic Trading Conference
Colin Meadows, CAO
20
Schedule of Non-GAAP Information1Q08 2007 2006 2005
Operating revenues, GAAP basis $910.4 $3,878.9 $3,246.7 $2,872.6
Third-party distribution, service and advisory costs (247.1) (1,051.1) (826.8) (706.0)
Proportional share of revenues, net of third-party distribution fees, from joint venture investments 20.9 60.6 8.1 --
Net revenues(1) $684.2 $2,888.4 $2,428.0 $2,166.6
Operating income, GAAP basis $228.1 $994.3 $759.2 $407.9
Proportional share of operating income from joint venture investments
17.2 45.5 2.9 --
Net operating income(1) $245.3 $1,039.8 $762.1 $407.9
Operating margin* 25.1% 25.6% 23.4% 14.2%
Net operating margin**(1) 35.9% 36.0% 31.4% 18.8%
* Operating margin is equal to operating income divided by operating revenues.** Net operating margin is equal to net operating income divided by net revenues.
(1) Net revenues, net operating income and net operating margin are non-GAAP financial measures. Management believes that these measures are additional meaningful measures to evaluate our operating performance. The most comparable U.S. GAAP measures are operating revenues, operating income and operating margin. Management believes that the deduction of third-party distribution, service and advisory costs from operating revenues in the computation of net revenues and the related computation of net operating margin provides useful information to investors because the distribution, service and advisory fee amounts represent costs that are passed through to external parties, which essentially are a share of the related revenues. Management also believes that the addition of our proportional share of operating revenues, net of distribution fees, from joint venture investments in the computation of net revenues and the addition of our proportional share of operating income in the related computations of net operating income and net operating margin also provides useful information to investors, as management considers it appropriate to evaluate the contribution of its growing joint venture investment to the operations of the business. Net revenues, net operating income and net operating margin should not be considered as substitutes for any measures derived in accordance with U.S. GAAP and may not be comparable to other similarly titled measures of other companies.
($ Millions)
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