schroders 2013 annual results

Schroders 2015 Results

Michael Dobson Chief Executive

3 March 2016

** Remove from final presentation **

Net revenue £1,658.5m (2014: £1,549.5m)

Profit before tax and exceptional items £609.7m (2014: £565.2m)

Profit before tax £589.0m (2014: £517.1m)

Full year dividend up 12% to 87.0 pence per share (2014: 78.0 pence per share)

72% of assets under management outperforming over three years

Net new business £13.0bn (2014: £24.8bn)

Assets under management £313.5bn (2014: £300.0bn)

Board and senior management succession

2015: overview Strong results in a challenging market

2015 Annual Results | March 2016 1


£32.0bn of new mandates

Net inflows £8.8bn

Strong performance in Asia Pacific, UK

Year of transition in US

Significant new business in Fixed Income and Multi-asset

Institutional Assets under management: £181.0bn (2014: £171.1bn)



Strong flows in H1, challenging markets in H2

Net inflows £4.3bn

Significant flows in Asia Pacific, continental Europe

Diversified across Fixed Income, Multi-asset, Equities

Active management of product range:

47 fund launches

40 fund closures

Intermediary Assets under management: £100.9bn (2014: £97.8bn)



£1.7bn of net inflows in core equities

Strong flows in Japanese and European equities

Small inflows in Emerging Markets

Outflows in UK equities

£2.5bn of outflows in £20.4bn Quant business

Equities Assets under management: £129.9bn (2014: £129.6bn)



Multi-asset Assets under management: £78.1bn (2014: £72.0bn)

Net new business £6.2bn

Diversified across Risk Mitigation

Risk Controlled Growth

Income

Inflation Protection

New initiatives in liquid alternatives



Net new business £9.1bn

Major flows in US/European Bond Beta

Global Multi-Sector

UK and European Credit

EMD Relative Return

Asian Bonds

New fund launches

Infrastructure Debt capability

Exploring initiatives in ABS/MBS, loans

Fixed Income Assets under management: £60.3bn (2014: £51.1bn)



Net revenues £207.2m (2014: £213.5m)

2014 included £9.0m of one off revenues

Profit before tax and exceptional items £61.3m (2014: £61.7m)

70% cost income ratio

Net inflows in UK £0.2bn

slowdown in H2

private clients and charities drawing down on investment returns

Outflows in Switzerland

reshaping business

Growth opportunities in UK, overseas

Wealth Management Assets under management: £31.6bn (2014: £31.1bn)



Strategy of building businesses with high quality partners

To enter new markets

China: Bank of Communications Schroders

India: Axis Asset Management Company

To complement existing presence

Japan: Nippon Life

To extend investment capabilities

Insurance linked securities: Secquaero

Convertibles

Loans

As investment opportunity

RWC

Nutmeg

Associates, joint ventures and partnerships Good progress in 2015


Schroders 2015 Annual Results

Richard Keers Chief Financial Officer

3 March 2016


43 58 78 87 0

102030405060708090

2012 2013 2014 2015

104.7 149.9 166.8 176.9 101.3 144.6 161.5 172.2 0

50

100

150

200

2012 2013 2014 2015

Basic Diluted

360.0 447.5 517.1 589.0

60.3 48.1

20.7

360.0

507.8 565.2

609.7

0

100

200

300

400

500

600

700

2012 2013 2014 2015

1,122.7 1,346.9 1,512.4 1,622.2

28.5

80.6 37.1

36.3

1,151.2

1,427.5 1,549.5

1,658.5

0

200

400

600

800

1,000

1,200

1,400

1,600

1,800

2012 2013 2014 2015

Profit before tax (£m) Net revenue, including performance fees (£m)

Financial highlights

Basic and diluted earnings per share before exceptional items

(pence)

Dividend per share (pence)

Exceptional items

Performance fees

10


Net revenue – driven by organic growth Net revenue up 7% to £1,659m

£m

DO NOT

change

any text in

the labels!

DO NOT

add any

line breaks

in the

labels!

Group segment 11

Group segment 28

Group segment 39

Asset Management

1,304

Asset Management

1,308

Asset Management

1,413

Wealth Management

213

Wealth Management

214

Wealth Management

207

Net revenue (old basis)

1,528

Associates and JVs

11

Net finance income 11

Net revenue (new basis)

1,550

Net new business 68

Markets and FX 38

Associates and JVs

11

Other (8)

Net revenue (new basis)

1,659

2014 2014 2015

11


0

100

200

300

400

500

600

700

800

Institutional Intermediary Performance fees

Asset Management net operating revenues Asset Management net operating revenue margins, excluding performance fees, at 49 bps

£m

2013 2014 2015

550.9 571.7 628.7

687.8 716.4 764.7

35.1

45.1

27.8

6.4

26.2

9.5

586.0

732.9

599.5

722.8

654.9

774.2

0

100

200

300

400

500

600

700

800

Institutional Intermediary Performance fees

550.9571.7628.7687.8716.4764.735.145.127.86.426.29.5586.0732.9599.5722.8654.9774.20100200300400500600700800InstitutionalIntermediaryPerformance fees

515.8

35.1

550.9 27.8

543.9

571.7

642.7

687.8

45.1 6.4

710.0

716.4 9.5

755.2

764.7

26.2

602.5

628.7

12


109.7

154.8 155.2

25.9

34.5 36.0

13.6

14.6 15.5

0.4

2.9 0.6

149.6

206.8 207.3

0

50

100

150

200

250

2013 2014 2015

Management fees Transaction fees Net banking interest income Performance fees

Wealth Management net operating revenues Wealth Management net operating revenue margins, excluding performance fees, at 65 bps

£m

13


Operating expenses Cost control in line with projections

£m 2014

2015

2015 versus 2014

AM

& Group WM Total

Compensation costs 687.8 637.2 96.8 734.0 +7%

Non-compensation costs 296.5 265.7 49.1 314.8 +6%

Operating expenses (excluding

exceptional items) 984.3 902.9 145.9 1,048.8 +7%

Exceptional expenses 48.8 17.7 0.8 18.5 -62%

Operating expenses (including

exceptional items) 1,033.1 920.6 146.7 1,067.3 +3%

Headcount 3,556 3,158 626 3,784 +6%

2014 2015

Compensation cost:net revenue ratio 44% 44%

Cost:net revenue ratio 64% 63%

14


Profit before tax and exceptional items Up 8% to £609.7m reflecting strong business performance

£m

Group segment 4.2

Group segment 7.9

Profit after tax and exceptional items

467.4

Asset Management

499.3

Asset Management

540.5

Wealth Management

61.7

Wealth Management

61.3

Profit before tax and exceptional

items 565.2

Net revenue 109.0

Compensation costs (46.2)

Other costs (18.3)

Profit before tax and exceptional

items 609.7

Tax (126.3)

Profit after tax and before exceptional items

483.4

2014 2015 2015

Exceptional items

(16.0)

15


Analysis of Group Capital Increase of £258m during 2015 to £2,796m

** Includes RWC Partners Limited and Schroder Ventures Investments Limited associates

£m

2014

2015

Regulatory capital 673 653

Other operating capital 284 253

Investment capital* 725 942

Seed capital 163 229

Other items** 693 719

Statutory Group capital 2,538 2,796

** Comprises goodwill, intangible assets, pension scheme surpluses, other associates and joint ventures and deferred tax

16

Schroders 2015 Results

Michael Dobson Chief Executive

3 March 2016


Good new business flows in Institutional

Market volatility reducing retail investor demand

Many long-term growth opportunities

Continuity and stability through succession plans

Outlook Resilience through a globally diversified business



Forward-looking statement

This presentation may contain forward-looking statements with respect to the financial condition, performance and position, strategy, results

of operations and businesses of the Schroders Group.

Such statements and forecasts involve risk and uncertainty because they are based on current expectations and assumptions but relate to

events and depend upon circumstances in the future and you should not place reliance on them. Without limitation, any statements

preceded or followed by or that include the words ‘targets’, ‘plans’, ‘sees’, ‘believes’, ‘expects’, ‘confident’, ‘aims’, ‘will have’, ‘will be’, ‘will

ensure’, ‘estimates’ or ‘anticipates’ or the negative of these terms or other similar terms are intended to identify such forward-looking

statements.

There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by

forward-looking statements and forecasts. Forward-looking statements and forecasts are based on the Directors’ current view and

information known to them at the date of this presentation. The Directors do not make any undertaking to update or revise any forward-

looking statements, whether as a result of new information, future events or otherwise. Nothing in this presentation should be construed as

a forecast, estimate or projection of future financial performance.

19

schroders 2013 annual results

Documents