edm inversión

EDM InversiónManaging Spanish stocks since 1987

Abril 2012

Managing Spanish stocks since 1987

Spanish Equity

This document is intended exclusively for professional investors, as defined by MiFID

EDM Inversión Index

1- Fund´s Performance

2- Investment Philosophy

3- Portfolio

2

3- Portfolio

4- Fund Managers

5- About EDM Asset Management

6- Summary

Fund’s Performance

3


EDM Inversión Fund’s Performance

Higher return and lower volatility

YearEDM

INVERSIONIBEX 35

Relative Performance

2000 -5,87% -21,75% 15,9%

2001 -0,90% -7,82% 6,9%

2002 -10,81% -28,11% 17,3%

2003 24,95% 28,17% -3,2%

2004 23,59% 17,37% 6,2%

2005 23,91% 18,20% 5,7%

4All EDM return data are expressed in euros and are stated net of expenses and fees.

2005 23,91% 18,20% 5,7%

2006 38,46% 31,79% 6,7%

2007 1,49% 7,32% -5,8%

2008 -37,15% -39,43% 2,3%

2009 26,84% 29,84% -3,0%

2010 -9,00% -17,43% 8,4%

2011 -6,10% -13,11% 7,01%

Total Return 52,41% -26,42% 78,83%

Annual Return 3,57% -2,52% 6,09%

Annualized Volatility 16,60% 20,74% -4,14%


Consistent Alpha generation in both bear and bull markets

5EDM Inversión Spanish equities ( Category) Ibex 35

Five years performance


TOTAL ANNUAL TOTAL ANNUAL TOTAL ANNUALPERIOD RETURN RETURN RETURN RETURN RETURN RETURN

1998-2002 6,0% 1,2% -16,8% -3,6% 22,8% 4,8%

EDM INVERSION IBEX 35 RELATIVE PERFORMANCE

6

1999-2003 7,8% 1,5% -21,3% -4,7% 29,1% 6,2%

2000-2004 28,5% 5,1% -22,0% -4,8% 50,5% 9,9%

2001-2005 69,1% 11,1% 17,8% 3,3% 51,3% 7,8%

2002-2006 136,3% 18,8% 68,5% 11,0% 67,8% 7,8%

2003-2007 168,9% 21,9% 151,5% 20,3% 17,4% 1,6%

2004-2008 35,2% 6,2% 18,9% 3,5% 16,3% 2,7%

2005-2009 38,8% 6,8% 31,5% 5,6% 7,3% 1,2%

2006-2010 1,9% 0,4% -8,1% -1,7% 10,0% 2,1%

2007-2011 -30,9% -7,1% -39,5% -9,6% 8,6% 2,4%

All EDM return data are expressed in euros and are stated net of expenses and fees.

EDM Inversión

Ranking 2011: 9 / 107- Spanish Equity Funds

Ratings & Ranking


7

Investment Philosophy

8

Investment Philosophy

EDM Inversión Investment Philosophy

Portfolio construction

• Long-only traditional investment style (bottom-up)

• Stock picking. No benchmarking (low overlapping against its benchmark)

• Long-term investment horizon (5 years on average)

• Low turnover (18% average for the last 6 years)

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• Low turnover (18% average for the last 6 years)

•High liquidity (93% of the portfolio can be sold within one trading day)

• Concentrated portfolio, maximum 20 companies

• Fully invested (never below 80%): competition among stocks

EDM Inversión Investment Philosophy

Stock picking methodology

• Focus on understandable and predictable businesses at reasonable prices

• Management quality & integrity are crucial for us

• Demanding criteria: High quality of the business (ROE = 14,5%)

10

• Sustainable EPS growth (9,4%)

• Recurrent and solid cash-flows

• Companies focused on international markets to generate growth

• Lack of sectors whose profits are not easily foreseen:

- Banking

- Cyclical sectors

Portfolio

11

Portfolio

EDM Inversión Portfolio

Grifols 11,49%

Técnicas Reunidas 7,93%

Telefónica 6,99%

Bolsas y Mercados 6,61%

Grupo Catalana Occidente 6,46%

Gamesa 4,60%

Obrascon Huarte Lain 4,57%

Enagas 4,36%

Indra 3,90%

Portfolio Top Holdings31-dic-11

(1) (2) (3) (3) (4) (5)2011-2016 Dividend

ROE EPS GROWTH P/E 2011 P/E 2012 PEG Yield

ABENGOA SA 18,1% 9,0% 8,6 9,1 0,95 1,2%

BOLSAS Y MERCADOS ESPANOLES 34,2% 8,0% 11,4 11,7 1,43 6,7%

CEMENTOS MOLINS SA 25,2% 8,0% 11,6 12,0 1,45 1,1%

CORPORACION FINANCIERA ALBA 14,6% 7,0% 4,5 6,0 0,65 13,2%

ENAGAS SA 20,1% 10,0% 9,6 9,0 0,96 6,3%

ENDESA SA 25,8% 10,0% 7,8 7,6 0,78 3,3%

GAMESA CORP TECNOLOGICA SA 3,1% 10,0% 12,2 11,1 1,22 0,2%

GAS NATURAL SDG SA 10,9% 10,0% 10,5 9,7 1,05 6,9%

GRIFOLS SA 18,3% 15,0% 23,9 15,5 1,60 0,0%

GRIFOLS SA-B 18,3% 15,0% 24,0 10,2 1,60 0,0%

GRIFOLS SA-ADR 18,3% 15,0% 12,5 9,8 0,84

GRUPO CATALANA OCCIDENTE SA 16,6% 9,0% 6,8 7,1 0,75 4,4%

IBERDROLA SA 10,3% 9,0% 9,7 9,2 1,08 7,2%

INDITEX 29,6% 10,0% 20,6 18,3 2,06 2,5%

INDRA SISTEMAS SA 19,6% 11,0% 8,5 8,6 0,77 6,9%

JAZZTEL PLC 3,6% 23,4 14,9

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Pharma

11%Money

Market

8%

Construction

6%

Industrials

16%

Fin. Services

19%

Energy

17%

Telecom

8%

BPO

4%

Cash

8%

Retail

3%

Indra 3,90%

Gas Nartural 3,47%

JAZZTEL PLC 3,6% 23,4 14,9

MAPFRE SA 14,7% 9,0% 7,8 7,3 0,87 6,1%

OBRASCON HUARTE LAIN S.A. 18,3% 13,0% 8,8 8,1 0,68 2,5%

REPSOL YPF SA 23,4% 13,0 10,5 4,4%

TECNICAS REUNIDAS SA 32,2% 12,0% 11,3 11,0 0,94 4,8%

TELEFONICA SA 47,8% 4,0% 9,2 8,5 2,31 11,4%

TOTAL 14,5% 9,4% 10,0 9,4 1,1 4,9%

Source: Bloomberg

(1) Profit after taxes/ Equity

(2) EDM estimates for 5 years CAGR

(3) EDM & Bloomberg data

(4) (3) / (2)

(5) Dividend/Price

EDM Inversión

Internationalization of the Portfolio

Portfolio

Internationalization of companies in the portfolio (2011)Company International EU OECD Other countries Domestic

Sales (%) (%) (%) (%) Sales(%)Gamesa 91 31 23 37 9

Grifols 89 11 65 13 11

Técnicas Reunidas 89 21 18 50 11

Abengoa 76 18 18 40 24

Inditex 74 45 12 17 26

Telefónica 72 25 7 40 28

Cementos Molins 64 0 0 64 36

Repsol 53 12 8 33 47

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Repsol 53 12 8 33 47

Iberdrola 52 29 16 7 48

Mapfre 50 18 6 26 50

Indra 39 14 7 18 61

Gas Natural 39 6 7 26 61

Endesa 35 4 0 31 65

Catalana Occidente 27 22 4 1 73

Enagás (1) 4 0 0 4 96

Bolsas y Mercados (1) 0 0 0 0 100

Jazztel (1) 0 0 0 0 100

Simple Average Average 50 15 11 24 50

Average excl. (1) 61 18 13 29 39

Weighted Average Average 53 15 14 24 47

Average excl. (1) 64 18 16 30 36

EDM Inversión

Sustainable profit growth …

Portfolio

EPS Growth

-20%

-10%

0%

10%

20%

30%

40%

∆∆∆∆ BPA EDM Inversión: +11.9% CAGR∆∆∆∆ BPA Ibex 35: + 5.9% CAGR

14

… Should be rewarded

P/E EDM INVERSIÓN (12m forward)

5

10

15

20

25

2003 2004 2005 2006 2007 2008 2009 2010 2011e

-30%

2005 2006 2007 2008 2009 2010 2011 e

EDM Inversión Ibex 35

EDM Inversión

Investment Opportunity

Portfolio

390%

490%

590%

EPS EDM Inversión FI: 12,7% APR

NAV EDM Inversión FI: 8,8% APR

+577,6% ∆∆∆∆ EPS

Oportuninity

15

-10%

90%

190%

290%

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Aggregate EPS EDM Inversión NAV EDM Inversión (31.12.2010)

+284,0% NAVEDM Inversión

Management Team

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Management Team

Ricardo Vidal, 42.CO-CIOConsumption Sector Specialist

Holds an MBA from ESADE University (Barcelona). Worked atBanco Vitalicio (Insurance Company) and Gesindex SGIIC (FinancialServices) from 1993 until 1997. Holds the Certified of EuropeanFinancial Analyst (CEFA). Joined EDM in July 1997. Es miembro delConsejo de Administración de EDMGestión, SGIIC.

EDM Inversión Management Team

Juan Grau, 66.EDM Inversión ManagerChairman of EDM Gestión, SGIIC

Business education. Graduate in businessManagement from IESE, Graduate in FinancialAnalysis and Tax from EADA and Analysis and

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Adolfo Monclús, 38.CO-CIORetail, Business Services andTMT´s Sector Specialist

Graduated in Business Administration by the UniversitatInternacional de Catalunya & in Economics Finance by BentleyCollege (USA). Holds an International MBA from Instituto deEmpresa (Madrid). Worked at Argentaria and BBVA in the Mid-Corporate Banking area. Joined EDM in July 2005 after finishinghis MBA.

Analysis and Tax from EADA and Analysis andBudget Control fromTEA-CEGOS.

Mr. Grau began his career as Controller of theAgrolimen Group Drinks Division. He was ChiefFinancial Officer and Board Member at thetextiles group Standard Fil, S.A. and ChiefFinancial Officer at Túnel del Cadí CESA.

Partner and Founder, in 1989, of EDM Group.He is currently Chairman of EDM Gestión,SGIIC and a Board Member of EDM Holding.

EDM Inversión

Gonzalo Cuadrado, 41Pharmacy, construction and infrastructureSector Specialist

Graduated in Economy by UB. Holds a Master inFinances by the IEF, the CEFA, the CIIA and theCAIA. Holds the “Certificado de Experto enValoración de Empresas”(CEVE) by IEAF. Worked asa fund manager and analyst in Caixa Penedès.Analyst and asset manager in EDM since 2004

Beatriz López, 34Medical, Food and Insurance Specialist

Graduated in Economics from UniversitatPompeu Fabra (UPF) in 1999, followed by aMaster’s Degree in Finance from CEMFI (Bank ofSpain) in 2001. Holds the Chartered AlternativeInvestment Analyst (CAIA) by the CAIAAssociation. She started her career at BancoSabadell, where she became Senior EquityAnalyst. Joined EDM in 2007 as a FinancialAnalyst and FundManager.

Management Team

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Alberto Fayos, 39Specialised industries and FinancialsSector Specialist

Holds a Bachelor’s Degree in Actuarial andFinances and a Degree in Statistics fromUniversity of Barcelona (UB). Holds theCertified European Financial Analyst (CEFA).Worked at Gaesco Gestión SCIIC from 1997until 2005. Worked at Banc Sabadell GestiónSGIIC from 2006 until 2009. Joined theInvestment Department of EDM in March2009, where he is analyst and portfoliomanager.

•No distinction between analyst & portfolio manager

• Collective discussion & Individual decision

• Investment Team over the last 6 years: Non-existent staff turnover

About EDM Asset Management

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EDM Inversión About EDM Asset Management

• 23 Years´s experience: founded in 1989

• Leading independent manager in Spain: AUM € 1.3 bn

• 100 M€AUM in spanish equities

• Independent: - Fully owned by the Group´s Management

- Focused exclusively on Asset Management

20

1.273 M€

0100

200300

400500600

700800900

1.0001.100

1.2001.300

198919

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9619

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0020

0120

0220

0320

0420

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0620

0720

0820

0920

1020

1120

12 (M

ar)

AUM

EDM Inversión About EDM Asset Management

Regulated companies in three European domiciles

EDM HOLDING, S.A.

EDM SERVICIOS EDM GESTIÓN EDM FUND EDM ASSET

100%

Company

21

EDM SERVICIOS FINANCIEROS

S.A. AV

EDM GESTIÓN S.A. SGIIC

EDM FUND MANAGEMENT, S.A.

EDM ASSET MANAGEMENT, Ltd

Discretionary Domestics Funds International Fuds Fund of Management SICAV SICAV Hegde Funds

SPAIN Since 1989

SPAIN Since 1989

LUXEMBOURG Since 1990

IRELAND Since 1999

Company

Country

Service

EDM Senior Managers

Eusebio Díaz-Morera, 66EXECUTIVE CHAIRMAN

Graduated in Economy from BarcelonaUniversity and MBA from IESE (Barcelona).Before founding EDM in 1989, he was GeneralDirector of PAS (Fund Management andCorporate Finance), Chairman of Caja deBarcelona (Savings Bank), Chairman of BancaCatalana, and Chairman of Tunel del Cadí

Antonio Estabanell, 52CEO

Holds an MBA from ESADE University(Barcelona). Worked at KPMG and twointernational food companies in the FinancialArea. Joined EDM in 1990 and since then hasbeen involved in all investment managementactivity within the company. Until 2010 he wastheManaging Director and CIO.

About EDM Asset ManagementEDM Inversión

Catalana, and Chairman of Tunel del Cadí(tollway concession)

theManaging Director and CIO.

Luis Fortuny , 45HEADOF BACK-OFFICE& COMPLIANCE

Graduated in Economics and Finances fromUAB. In 2006, he received a BA degree in PDDfrom IESE Business School. He was working atSONY from 1990 to 2000 as AccountingManager and Control Manager. He was SeniorConsultant at Cap Gemini Ernst & Young. Hewas also Finance Director at Baker & Mc Kenzie(Law firm). He joined EDM in 2008.

Javier Prada, 62DIRECTOR

Graduated in Law, he holds a Master inFinance (University of Paris). He started hiscareer in Banif Private Bank (Santander) wherehe was Regional Manager and FormerManaging Director. In 1991 he joined Indosuez-Credit Agricole where he was Private BankingGeneral Manager and Regional President. Hejoined EDM in 2005.

European EquitiesEDM Strategy

Credit Short Duration (Investment Grade)EDM Ahorro

EDM performance with other asset types

Year EDM AHORRO INFLATIONRelative

Performance

2000 2,39% 2,48% -0,09%

2001 4,49% 2,05% 2,45%

EDM Inversión

Year EDM STRATEGY STOXX 50Relative

Performance

2000 15,83% 1,88% 13,95%

2001 -8,55% -18,66% 10,11%



2001 4,49% 2,05% 2,45%

2002 2,19% 2,28% -0,09%

2003 2,22% 1,97% 0,25%

2004 1,61% 2,36% -0,75%

2005 1,18% 2,22% -1,05%

2006 0,01% 1,92% -1,91%

2007 1,58% 3,07% -1,49%

2008 3,15% 1,58% 1,56%

2009 6,94% 0,93% 6,01%

2010 1,73% 2,21% -0,48%

2011 2,00% 2,01% -0,01%

Total Return 33,60% 28,10% 5,50%

Annual Return 2,44% 2,10% 0,34%


2001 -8,55% -18,66% 10,11%

2002 -34,36% -35,05% 0,69%

2003 2,35% 10,50% -8,16%

2004 6,96% 4,30% 2,66%

2005 23,96% 20,70% 3,26%

2006 15,98% 10,39% 5,59%

2007 2,55% -0,36% 2,91%

2008 -28,74% -43,43% 14,69%

2009 25,50% 24,06% 1,43%

2010 11,88% 0,04% 11,84%

2011 -5,00% -8,39% 3,39%

Total Return 6,67% -50,04% 56,71%

Annual Return 0,54% -5,62% 6,16%


EDM Inversión

EDM performance with other asset types

FUND CATEGORY20 Years

RETURN

15 Years

RETURN

10 Years

RETURN

7 Years

RETURN

3 Years

RETURN

2 Years

VOLATILITY

2011

RETURNInception Date ISIN

EDM Strategy Europe Equity Large Cap 241,68 81,18 0,70 40,15 28,54 11,28 -5,00 31/10/1995 LU0028445327

EDM Ahorro Euro Corporate Credit 115,95 48,55 25,23 17,64 9,29 1,81 2,00 01/04/1991 ES0168673038

EDM Inversión Spanish Equity 331,87 170,68 63,37 18,62 6,94 17,25 -6,10 01/04/1991 ES0168674036



EDM Inversión Spanish Equity 331,87 170,68 63,37 18,62 6,94 17,25 -6,10 01/04/1991 ES0168674036

EDM Renta Euro Fixed Income 47,62 23,82 16,27 4,10 0,63 1,60 22/12/1994 ES0127795039

EDM American Growth (USD) US Equity Large Cap Growth -24,22 3,19 45,70 12,58 4,01 31/05/1999 LU0095539242

EDM Cartera Global Equity Large Cap 10,09 11,60 -5,15 11/07/2008 ES0128331008

EDM American Growth (EUR) US Equity Large Cap Growth 41,91 18,24 0,22 10/09/2008 LU0388590050

EDM Credit Portfolio High Yield Fixed Income 43,65 7,89 4,24 08/10/2008 LU0028445590

EDM Emerging Markets Emerging Markets Equity 12,72 -17,80 21/12/2009 LU0051440435

EDM High Yield Short Duration High Yield Fixed Income 1,52 06/10/2011 LU0146855530

Summary

25

Summary

10 reasons for investing in EDM Inversión

1. Consistent returns above benchmark (+6% annual outperformance)

2. Very small volatility for an equity fund (-4% annual bellow benchmark)

3. Excellent relative performance throughout the financial crisis (2007-2011)

4. Stable investment philosophy all over 23 years

5. Unique and tested investment process developed by an experienced management team

SummaryEDM Inversión

26

5. Unique and tested investment process developed by an experienced management team

6. Very high quality (ROE) and liquid concentrated portfolio

7. Defensive strategy: focus on "ensured growth" without cyclical sectors

8. Portfolio valuation at historial minimum levels

9. Poor overlapping and low correlationwith other fund managers

10. Complementarywith other equity styles

SummaryEDM Inversión

CURRENCY Euro IDENTITYIDENTITYIDENTITYIDENTITY

NAV 32,26 € German Tax Transparency

FUND AUM 30.264.000 € UCITS

SPANISH PORTFOLIO AUM 100.000.000 € LEGAL STRUCTURE ES & PT- FI

INCEPTION DATE 21/02/1987 INCOME DISTRIBUTION Retained

MANAGEMENT FEE (Private) 2,25%

CUSTODIAN FEE 0,15%

TOTAL EXPENSE RATIO 2,40%

FUND MANAGERS Juan Grau

MANAGER EDM Gestión SGIIC EU TAX DIRECTIVEEU TAX DIRECTIVEEU TAX DIRECTIVEEU TAX DIRECTIVE

CUSTODIAN Bankinter, S.A. Eu Tax Directive Start Date 01/05/2012

AUDITOR KPMG Auditores, S.L. Eu Tax End Date 30/04/2013

EDM INVERSION

27

AUDITOR KPMG Auditores, S.L. Eu Tax End Date 30/04/2013

DOMICILE Spain Eu Tax Directive Status Out of Scope

DEALING Daily Eu Tax Directive 15% Threshold No

CATEGORY Spanish Equities Eu Tax Directive 40% Threshold No

SPANISH CNMV CLASSIFICATION Euro Equity Prospectus vs Asset Allocation No

SPANISH INVERCO CLASSIFICATION Spanish Equities NAV Taxable Interest Income Accrued No

LIPPER CLASSIFICATION Equity Spain Dividend Taxable Interest Incime Accrued No

COUNTRIES REGISTERED FOR SALE DISTRIBUTION PLATFORMS

Spain ("Traspasable") Inversis Banco

CROSS REFERENCES CROSS REFERENCES

ISIN ES0168674036 F&E FUND CODE 37769

ISIN CURRENCY CLASS ES0168674036.EUR F&E GROUP CODE 21028

CNMV CODE 46 PERM ID 18060016055

BLOOMBERG EDMINVE SM RIC 0168674036.ES

REUTERS 0168674036.ES RIC LP60016055

LIPPER 60016055 VALOR 430798

WKN- GERMAN A0MXS7

www.edm.esIgnacio PedrosaHead of Investor Relations+34 636814186+34 [email protected]://es.linkedin.com/in/ipedrosa

LEGAL NOTICE

1) This information represents disclosure by EDM and is intended merely to inform those to whom it is addressed in compliance with the code of cunsuct applying to all investment services in Spain. For this reason efforts have been made to ensure that it is sufficient and understandable to anybody likely to receive it.

Given that the information may refer to or include separate additional documentation, the recipient is invited to request this from EDM.

If, within the body of information in this notification, there should be any offer regarding products, financial instruments or services, the recipients thereof also have at their disposition supplementary or additional If, within the body of information in this notification, there should be any offer regarding products, financial instruments or services, the recipients thereof also have at their disposition supplementary or additional documentation which will enable them to authorise all the terms and conditions pertaining to the offer of interest to them.

2) EDM is a securities broker registered in Spain (Avda. Diagonal 399 3º 1ª, 08008 Barcelona) and is authorised to provide investment services with regard to securities and financial instruments for clients, in relation to whom it is subject to the supervision of the Comisión Nacional del Mercado de Valores (National Securities Market Commission) (CNMV, Paseo de la Castellana 19, 28046 Madrid), where it is registered under number 139. The broker is a member of the Fondo de Garantía de Inversiones (FOGAIN, the Investment Guarantee Fund).

3) The recipients of this information should bear in mind that any results or data provided may be subject to fees, commission, taxes, expenses or duties, which could lead to a reduction in the gross return, which will depend on the particular nature of each case.

4) It is here left on record that the instruments described in this information are subject to the impact of various common causes, such as:

i- Alterations to the markets due to unforeseen circumstances

i- Liquidity risks and others which affect the progress of the investment.

5) Within this information here figures appear that refer to past returns for the products mentioned. It is obvious that such information should be used as a reference and as valid background data to reach one’s own conclusions, but under no circumstances should it be employed as an indicator guaranteeing future performance.

By the same token, the information contained that might simulate future trends for any product and its performance must, for identical reasons as those cited for past data, be considered as a valid reference to reach one’s own conclusions but in no way seen as a guarantee of returns that will be obtained.

6) Within this documentation there may be figures based on currencies other than those used by recipients hereof. For this reason consideration should be given to any possible change upwards or downwards in the value of the currency and how this affects the results for the products or instruments proposed.

This document is reserved for professional investors only as defined by theMIFID