8th Annual Meeting of Shareholders - Marlin · Presentation of Annual Result. Marlin’s Investment...
Transcript of 8th Annual Meeting of Shareholders - Marlin · Presentation of Annual Result. Marlin’s Investment...
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Annual Meeting
of Shareholders
Marlin Global Limited
14 November 2017
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Agenda
• Preliminary matters (Annual Report, minutes
& class financial advice)
• Chair’s Overview
• Manager’s Review
• Q&A
• Annual Meeting Resolutions
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Board of Directors
Investment Team
Alistair Ryan Carmel Fisher Andy Coupe Carol Campbell
Ashley GardyneSnr Portfolio Manager
Chris WatersSnr Investment Analyst
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Chair’s OverviewPresentation of Annual Result
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Marlin’s Investment Objectives
Achieve a high real rate of return, comprising both
income and capital growth within acceptable risk
parameters
Access to a diversified portfolio of international
quality, growth stocks single tax-efficient vehicle
Absolute Returns
Diversified Portfolio
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2017 Overview
Net profit Dividend NAV per share
$15.7m(2016: -$6.9m)
6.81cps(2016: 7.47cps)
$0.89(2016: $0.83)
Total shareholder
return*Dividend return
Adjusted NAV
return*
+9.1%(2016: -0.3%)
+8.6%(2016: +8.6%)
+16.8%(2016: -6.7%)
*These metrics are Non-GAAP measures calculated in accordance with the methodology described in the Marlin Non-GAAP Financial Information Policy which is available on the Marlin website.
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Use of Shareholder Funds
94
106
-8 -0.5
+1
+16
+3
70
75
80
85
90
95
100
105
110
115
OpeningNAV
NetProfits
DividendsPaid
DividendsReinvested
Buybacks Shares issued forwarrants exercised
ClosingNAV
Year ended 30 June 2017 ($m)
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Portfolio Performance
For the year ended
30 June 12 months
3 years
(annualised)
5 years
(annualised)
Gross
Performance
Return*+22.4% +12.2% +13.4%
Benchmark
Index^ +19.2% +14.6% +16.5%
*This metric is a Non-GAAP measure calculated in accordance with the methodology described in the Marlin Non-GAAP Financial Information Policy which is available on the Marlin website. ^World Small Cap Gross Index until 30 September 2015 & S&P Large Mid Cap/S&P Small Cap Index (hedged 50% to NZD) from 1 October 2015.
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2017/2018 First Four Months
30 June – 31 October 2017
Total shareholder return*
+6.3%Gross performance return*
+12.5%NAV per share
$0.98Blended Index^
+11.5%Net profit
$11.8m*These metrics are Non-GAAP measures calculated in accordance with the methodology described in the Marlin Non-GAAP Financial Information Policy which is available on the Marlin website. ^S&P Large Mid Cap/S&P Small Cap Index (hedged 50% to NZD)
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Manager’s ReviewAshley Gardyne
Senior Portfolio Manager
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Agenda
1. Why own international shares?
2. Review of markets in 2017
3. Portfolio activity and performance
4. Outlook
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Why Marlin
1. Why own international shares?
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Why Marlin
Why bother with international shares?
• Opportunity to own world leading
companies
•
• Not linked to NZ economy,
shares or property
• Exposure to other
currencies
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-3.8% -3.9%
20.4%
Marlin Benchmark NZX50
22.4%
19.2%
10.4%
Marlin Benchmark NZX50
FY17
Why bother with international shares?
FY16
Benchmark: World Small Cap Gross Index until 30 September 2015 & S&P Large Mid Cap/S&P Small Cap Index (hedged 50% to NZD) from 1
October 2015.
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2. Review of markets in 2017
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May-16 Aug-16 Nov-16 Feb-17 May-17
What drove global markets in 2017?
+15%
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May-16 Aug-16 Nov-16 Feb-17 May-17
What drove global markets in 2017?
Market driven by earnings growth
+15%
+16%
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Why Marlin (1)
-
1
2
3
4
5
6
7
8
9
NZ US Europe China
%
2012 2017
And what drove corporate earnings?
Global GDP growth (%)Higher and more synchronised
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3. Portfolio activity and
performance
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Selected exits and additions
ExitsAdditions
• Global leader in heart valves• Large growth opportunity in
minimally-invasive heart repair• Market too focused on quarterly
earnings
• Service provider to oil industry• Long track record of growth• Opportunity given weak oil price• Exposure to new sector
• #2 global hearing aid supplier • High tech barriers to entry• Steadily growing demand • Opportunity to grow in retail
• #1 US medical waste operator • US hospital consolidation led
to lower bargaining power• Growth outlook reduced
• Global leader in ostomy care• Great business, but growth
outlook now more challenged• Better opportunities elsewhere
• Global infant formula player• Leader in emerging markets• Exited at 30% premium after
takeover
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0%
10%
20%
30%
40%
50%
Den
mar
k
UK
Aus
tral
ia US
Fran
ce
Ital
y
Spai
n
Hearing aid penetration
Key new addition:
Leader in hearing care…
… benefiting from new technology
and increasing adoption
What does William Demant do?
• 2nd largest hearing aid manufacturer
• Market leader in hearing diagnostics
• Large growing chain of audiologists
• Growing business in hearing implants
We like William Demant because:
• Oligopolistic market with 4 key players
• High technological barriers to entry
• Gaining share via leading technology
• Steadily growing demand
• Opportunity to grow retail business
• High incremental margins
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-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
Our companies delivered strong growth
EBITDA growth for the 12 months ended 30 June 2017
EBITDA Growth (%)
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-20
-10
--
10
20
30
40
50
60
70
80
Total Shareholder Return (%)Marlin portfolio companies
Why Marlin
Which has driven strong returns
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Why Marlin
Investment process rewarded
Marlin gross performance vs global markets (%)
22%19%
10%13%
15%
19%
12%
Marlin Benchmark NZ Australia USA Europe UK
Benchmark: S&P Large Mid Cap/S&P Small Cap Index (hedged 50% to NZD)
For the year ended 30 June 2017
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Why Marlin
The result: A balanced portfolio
# of companies
29(32)
# of countries
11(9)
EBITDA growth
+13% (14%)
Marlin portfolio – Sector split
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4. Outlook
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Markets have had a good run …
Why Marlin…and investors need to be more selective
ASX 200
MSCI EM
MSCI Europe
S&P500
NZX50
20
40
60
80
100
120
140
160
180
200
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
PE multiple
19.8x
18.0x
15.1x
16.0x
12.9x
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Why Marlin
Marlin is doing its job for you
• International shares play important role in
portfolios
• We continually scour the globe for the best
investments
• Our goal is to maintain a portfolio of high
quality growth stocks that will outperform over
an economic cycle
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General Questions
from Shareholders(not relating to resolutions)
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Annual Meeting2017 resolutions
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2017 Annual Meeting Resolutions
• Introduce and propose
• Discussion, questions
• Enter your vote on voting paper and
lodge your voting paper at end of
resolutions
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Matters of Business
• Annual Report
• Resolutions:
–Re-elect Andy Coupe
–Auditor’s remuneration
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Resolution 1
Re-election of Andy Coupe
To re-elect Andy Coupe as a director
of Marlin Global Limited
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Resolution 2
Auditor’s Remuneration
To authorise the Board of Directors to
fix the remuneration of the auditor for
the ensuing year
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Proxy Count
Resolution For Against Discretionary Total Abstain
Re-elect Andy
Coupe 4,375,919 861,502 1,892,403 7,129,824 0
Fix auditor’s
remuneration5,048,667 233,419 1,767,230 7,049,316 80,508
Proxy votes to date: 7.1 million
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Conclusion
• Complete and sign voting paper
• Voting papers in the voting boxes
• If you need a voting paper please
see Computershare
• Results to NZX
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Thank you