Pan-European Equities

Transcription

1 Pan-European Equities Pavillon Cambon, Paris For Professional Investors only

2 Rebased at 100 = Aug CELEBRATING A 25-YEAR TRACK RECORD OF EUROPEAN EQUITY % p.a.* % p.a.* Aug-89 Sep-91 Oct-93 Nov-95 Dec-97 Jan-00 Feb-02 Mar-04 Apr-06 May-08 Jun-10 Jul-12 Aug-14 Pan-European Composite MSCI Europe - NR *Annualised gross performance since creation of the composite / Data as of end September 2014, in EUR. Source: FactSet/Comgest Data represents composite, gross-of-fees performance for all funds managed by Comgest in the relevant strategy. Performance is gross of management fees and performance fees (where applicable). The treatment of other fees may vary between collective investment schemes and discretionary accounts. The inclusion of management and other fees would have the effect of decreasing the composite performance results. Reference to the benchmark is for comparative purposes only and is not intended to indicate that the composite will contain the same investments as the benchmark. The volatility of the index may be materially different from that of the composite. The index used for comparative purposes changed from MSCI Europe price to MSCI Europe dividends reinvested from 01/01/2001. Prior to 2000, figures are converted using the relevant FRF exchange rates. Investors have the opportunity for losses as well as profits. Past performance is no guarantee of future results.

3 3 RENAISSANCE EUROPE: TWO DECADES OF QUALITY GROWTH INVESTING * Fund +9.1% p.a. MSCI Europe +7.5% p.a * Fund +9.5% p.a. MSCI Europe +6.3% p.a *: +487% vs. +279% for the MSCI Europe Source: FactSet/Comgest. Net performance in EUR. * = 31/12/ /12/2003 / = 31/12/ /12/2013 / = 31/12/ /12/2013 Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Performance calculation based on NAV to NAV variation expressed in euros. Fund volatility is calculated using weekly performance data. Comgest S.A. assumed full management of the fund on 31/12/1993 and 'performance since inception' is as of this date.

4 4 RENAISSANCE EUROPE* Contribution analysis Total portfolio return +138% SAP AG +23% Securitas +19% Hennes & Mauritz +15% Novartis +11% Sodexho Alliance +9% Carrefour +8% Compass Group +8% Rentokil Initial +6% L'Oréal +5% Dassault Systèmes +5% % contribution -2% -3% -3% -3% -4% CMG BiC Software AG Altran Technologies Ahold Source: FactSet/Comgest. *Comgest s European Flagship Fund / Net performance in EUR, = 31/12/ /12/2003. Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Comgest runs a buy-and-hold contribution system which performs holdings-based analysis using the beginning of period weights of securities and their returns to calculate contributions. Returns are therefore not derived from the actual portfolio return and may not reconcile with the real portfolio return as measured by NAV to NAV variation. The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

5 5 RENAISSANCE EUROPE* Performance Annual return (calendar) 50% 25% 0% 3.3% 22.7% 11.5% 38.8% 28.7% 25.1% 43.3% 32.7% 19.4% 7.6% 33.7% 10.3% 3.3% 15.3% -25% -3.8% -3.6% -7.8% -15.5% -27.8% -30.7% -50% Fund MSCI Europe - NR *Net performance in EUR. Source: FactSet/Comgest Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Performance calculation based on NAV to NAV variation expressed in euros. Comgest S.A. assumed full management of the fund on 31/12/1993.

6 6 RENAISSANCE EUROPE* Contribution analysis Total portfolio return +147% Hennes & Mauritz Roche Holding Ltd Coloplast Inditex Sodexo Capita Koninklijke Numico Essilor International Novo Nordisk Reckitt Benckiser +17% +16% +14% +14% +13% +13% +11% +11% +10% +9% % contribution -2.0% -1.9% -1.8% -1.7% -1.7% Dixons Carphone AstraZeneca Straumann Connaught Amplifon Source: FactSet/Comgest. *Comgest s European Flagship Fund / Net performance in EUR, = 31/12/ /12/2013. Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Comgest runs a buy-and-hold contribution system which performs holdings-based analysis using the beginning of period weights of securities and their returns to calculate contributions. Returns are therefore not derived from the actual portfolio return and may not reconcile with the real portfolio return as measured by NAV to NAV variation. This material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

7 7 RENAISSANCE EUROPE* Performance Annual return (calendar) 50% 25% 0% 12.2% 7.8% 24.2% 26.1% 18.4% 19.6% 3.8% 2.7% 20.9% 31.6% 15.7% 11.1% 2.0% 29.2% 17.3% 14.8% 19.8% -8.1% -25% -29.1% -50% -43.7% Fund MSCI Europe - NR Source: FactSet/Comgest *Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Performance calculation based on NAV to NAV variation expressed in euros. Comgest S.A. assumed full management of the fund on 31/12/1993.

8 8 RENAISSANCE EUROPE* 20 years of outperformance, driven by the superior fundamentals of selected quality growth companies % p.a.** % p.a.** 0 Apr-94 Feb-96 Dec-97 Oct-99 Aug-01 Jun-03 Apr-05 Feb-07 Dec-08 Oct-10 Aug-12 Jun-14 Renaissance Europe* DJ Stoxx Renaissance Europe* - EPS DJ Stoxx - EPS Source: FactSet/Comgest. *Comgest s European Flagship Fund. ** net performance in EUR, as of 30/09/2014. Past performance is no guarantee of future results. Indices are used for comparison of past performance only.

9 Outlook 9

10 10 FOCUSING ON VISIBLE GROWTH TRENDS AND TANGIBLE COMPETITIVE ADVANTAGES IN AN UNCERTAIN ENVIRONMENT based on our stock-picking strategy Economic growth subdued: Demographics Deleverage Emerging countries catch-up maturing Comgest: Structural growth trends Unique franchises Selective stock picking

11 11 MEGATREND #1 AGEING POPULATION Trends in the share of the population aged over 80 yrs ( e) 20% Prevalence (%) of people with diabetes by age and sex, 2013 Comparison of the age-related healthcare expenditure profiles (males, EU-12) 16% % % 8.3 4% 0% OECD Japan World EU-27 Key Emerging Countries* as % of GDP p.c. Source (left to right): OECD Historical Population Data and Projections Database 2013 (*Emerging economies include Brazil, China, India, Indonesia and South Africa) / IDF Diabete Atlas 2013 / National Data Investors should be aware that these figures are provided for information purposes only and Comgest does not take any responsibility for discrepancies which may occur between estimated forward figures and factual data published over the coming months/years.

12 12 MEGATREND #2 DIGITALISATION Internet sales as a percentage of total UK retail sales (non-seasonally adjusted) Mobile devices* in use in Europe (excl. Russia) % cagr +23% cagr (est.) Source (left to right): ONS / IDC, Worldwide New Media Market Model May 2014 (*include Smartphones, tablets, etc.), Investors should be aware that these figures are provided for information purposes only and Comgest does not take any responsibility for discrepancies which may occur between estimated forward figures and factual data published over the coming months/years.

13 13 MEGATREND #3 POLARISATION OF CONSUMER SPENDING Price (profit margin) Premium stuck in the middle Low cost Volume (capital turnover) The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment.

14 Annual growth rate PORTFOLIO EXPOSURE TO STRUCTURALLY DYNAMIC MARKETS 14 Long-term industry trends 16% +15.0% 14% 12% +11.0% 10% 8% +7.0% +7.0% EU long-term nominal GDP growth (96-13) 6% 4% +5.5% +5.5% +4.0% +5.0% +5.0% +5.0% +5.0% 2% 0% Air traffic Biopharma market Diabetes care market European outsourcing market Global beauty market Global premium chocolate Industrial gases Online Optical lenses commerce in market Europe Ostomy and Incontinence care Software IT spending Source: Independent industry research reports, Comgest. Data as at 31/08/2014.

15 Growth, rebased 100 Growth, rebased 100 Growth, rebased GROWTH FROM REINVESTMENT IN STAGNANT MARKETS EU clothing market French Telecoms market EU construction market European clothing market H&M organic sales growth Inditex organic sales growth French telecoms market Iliad organic sales growth European construction market Geberit organic sales growth Source: Company data / Comgest, data between 2001 and 2013 Past performance is not a reliable guide to future performance. The value of investments may go down as well as up. This material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment.

16 Annual growth rate 16 SUSTAINABLE AND SUPERIOR ORGANIC SALES GROWTH 12% 10% 8% 6% 4% 2% 0% -2% % -6% Aggregate organic sales growth of the Comgest portfolio EU nominal GDP Source : Company data, Eurostat Data as at end June Comgest s European Flagship Fund

17 17 COMGEST GROWTH EUROPE DOUBLE-DIGIT EARNINGS GROWTH Megatrends Microtrends (innovation & expansion) Operating leverage (pricing power) FCF generation EPS > 10% GROWTH

18 18 EXAMPLE: INDITEX Leading global apparel fashion retailer 8 brands The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment.

19 19 INDITEX: A UNIQUE BUSINESS MODEL Proximity sourcing = in-season buying Centralised logistics Pull model Scalable platform The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment.

20 20 INDITEX: FAST LEAD TIME FROM DESIGN TO SHELF 8 months 6 months 2-5 weeks The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment.

21 10 years FCF conversion 21 INDITEX: SOLID FINANCIAL METRICS ROCE >35% Strong organic growth 80% FCF conversion Passed 2009 crash test >10% long term EPS growth, 15% last 10 years EPS Organic growth 40% 25% 10% -5% FCF conversion vs. EPS growth average Inditex organic growth European apparel market H % 78% 75% Inditex % Eurostoxx Source: Company data. The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment. 70% 0% 2% 4% 6% 8% 10% 12% 14% 16% 10 year EPS growth

22 22 INDITEX: A HIGH QUALITY COMPANY Strong competitive advantage: fast fashion Family-owned enterprise culture: long-term and performance-oriented Rising investment in human capital Receptive to clients, responsible towards suppliers Responsible sourcing

23 est. 23 INDITEX: NEW STORES + SAME-STORE-SALES GROWTH Number of stores Same-store-sales growth % +10% +8% +6% +4% +2% 0 +0% 10 15% annual sales growth Source: Company data. The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment. Past performance is no guarantee of future results. Forward looking statements or data may not be realised.

24 H&M GAP Zara Uniqlo Pull&Bear Massimo Dutti Bershka Stradivarius Oysho Zara Home 24 INDITEX: GROWTH IN THE LONG TERM Significant long-term potential for newer brands Sales in EUR bn 16 Still immature in most markets Market share by region 20% % 10% 4 2 5% 0 0% Spain Portugal Mexico France Italy Russia UK Germany China Source: Company data, Euromonitor. The material presented in this document is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment. Past performance is no guarantee of future results.

25 EPS ( ) Index Price ( ) 25 EUROPEAN EQUITY EARNINGS UNDER PRESSURE Dec-11 Mar-12 Jun-12 Sep-12 Dec-12 Mar-13 Jun-13 Sep-13 Dec-13 Mar-14 Jun-14 Sep EPS 2012 MSCI EUROPE EPS 2013 MSCI EUROPE EPS 2014 MSCI EUROPE MSCI Europe Decoupling of price from fundamental trends in Europe. Performance driven by re-rating across all sectors. Source: Factset. Data as at 31/10/2014. Past performance is no guarantee of future results. Indices are used for comparison of past performance only

26 26 COMGEST EUROPEAN STRATEGY: FOCUS ON EXCELLENCE Comgest European Strategy MSCI Europe Average Market Cap (bn ) Number of holdings ROE 22.8% 16.7% Operating margin 19.8% 15.7% Long-term EPS growth +13% p.a.* +6% p.a.** 85.7% active share Net performance in EUR as of 31/10/2014 Source: FactSet/Comgest **Estimation based on a long-term historical average. Past performance is no guarantee of future results. Indices are used for comparison of past performance only. *Forward looking data is estimated and is not a reliable guide to future performance.

27 Sales growth 27 DEFY THE GRAVITY OF EUROPE 20% 15% 14.8% 13.9% 10% 5% 8.1% 9.1% 11.2% 6% 9% 11.2% 11.5% 6% 7% 5.7% 9.4% 10% 7.4% 7% 4% 6.4% 6.9% 8.9% 7.3% 3.6% 2.6% 0% -1% -1% -0.8% -0.1% -5% -6% -10% E 2015E 2016E Comgest European Strategy STOXX600 Data as of 14/11/2014 Source: FactSet/Comgest Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Forward looking data included is estimated and it is not a reliable guide to the future performance.

28 Return 28 LONG TERM PERFORMANCE OF THE PORTFOLIO Risk / Return over 10 years (as of 31/10/2014) +12% Comgest Growth Europe +8% MSCI Europe +4% 12% 14% 16% 18% 20% Risk* Source: Factset / Comgest. Net performance in EUR. Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Performance calculation based on NAV to NAV variation expressed in euros. *Fund volatility (standard deviation) is calculated using weekly performance data.

29 Appendices 29

30 30 COMGEST GROWTH EUROPE Portfolio composition* Country breakdown (%) Sector breakdown (%) France Germany Switzerland United Kingdom Spain Denmark Sweden Netherlands Others [Cash] United States Italy Portugal Norway Ireland Finland Belgium Austria Health Care Consumer Discretionary Industrials Information Technology Consumer Staples Materials Others [Cash] Telecommunication Services Energy Utilities Financials Comgest GrowthEurope MSCI Europe Comgest Growth Europe MSCI Europe Source: Factset / Comgest. *Portfolio as of 31/10/2014

31 31 COMGEST GROWTH EUROPE Portfolio contribution analysis* Top 5 contributors and detractors - Year-to-date, 31/10/2014 % contribution Coloplast 1.33 Novo Nordisk 1.14 Essilor International Capita plc Geberit Prada Inditex Gemalto NV ARM Holdings SAP Source: Factset / Comgest. *Data in EUR. Past performance is no guarantee of future results. Indices are used for comparison of past performance only. Comgest runs a buy-and-hold contribution system which performs holdings-based analysis using the beginning of period weights of securities and their returns to calculate contributions. Returns are therefore not derived from the actual portfolio return and may not reconcile with the real portfolio return as measured by NAV to NAV variation. This material is for information purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

32 INCREASED 32 COMGEST GROWTH EUROPE 2014 main portfolio changes BOUGHT Core Laboratories Luxottica Hermès Amadeus Bayer Essilor SOLD Jeronimo Martins Sartorius Prada Dufry REDUCED Experian Linde SAP Data as of 31/10/2014, Source: FactSet/Comgest This material is for information purposes and is not intended as an offer or solicitation with respect to the purchase or sale of any security.

33 33 IMPORTANT INFORMATION This document has been prepared for professional investors only and may only be used by these investors. This material is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The contents of this document should not be treated as advice in relation to any potential investment. The securities discussed herein may not be held in the portfolio at the time you receive this presentation. Performance figures are provided net of all fees unless otherwise stated and are calculated on a time-weighted, total return basis. Funds which specialise in a particular region or market sector may entail higher risks than those which hold a very broad spread of investments. Past investment results are not necessarily indicative of future investment results. The value of all investments and the income derived therefrom can decrease as well as increase. This may be partly due to exchange rate fluctuations in investments that have an exposure to currencies other than the base currency of the Fund. Reference to market indices or other measures of relative market performance over a specified period of time are provided for your information only. Reference to an index does not imply that the portfolio will achieve returns, volatility or other results similar to the index. The composition of the index will not reflect the manner in which a portfolio is constructed. The information and any opinions have been obtained from or are based on information from sources believed to be reliable, but accuracy can not be guaranteed. No liability is accepted by Comgest in relation to the accuracy or completeness of the information contained in this document. The information in this document is not comprehensive and is presented for informational purposes only. All opinions and estimates constitute our judgment as of the date of this presentation and are subject to change without notice. Comgest does not provide tax or legal advice to its clients and all investors are strongly urged to consult their own tax or legal advisors concerning any potential investment. Before making any investment decision, investors are advised to check the investment horizon and category of the Fund in relation to any objectives or constraints they may have. Investors must read the latest Fund prospectus and the Key Investor Information Document ( KIID ), available at our offices and on our website Investors shall undertake to respect the legal, regulatory and deontological measures relative to the fight against money laundering, as well as the texts that govern their application, and if modified investors shall ensure compliance with the applicable texts. This material is in no case an offer for people living in a specific jurisdiction which does not authorize the distribution of the Funds mentioned herein. The investment professionals listed in this document are employed either by Comgest S.A., Comgest Asset Management International Limited, Comgest Far East Limited, Nippon Comgest Inc, Comgest Singapore Pte. Ltd. Comgest S.A. is regulated by the Autorité des Marchés Financiers (AMF). Comgest Far East Limited is regulated by the Hong Kong Securities and Futures Commission. Comgest Asset Management International Limited is regulated by the Central Bank of Ireland. Nippon Comgest Inc. is regulated by the Financial Service Agency of Japan (registered with Kanto Local Finance Bureau (No. Kinsho 1696)). Comgest Singapore Pte Ltd, created 18 August 2010, is a Licensed Fund Management Company & Exempt Financial Advisor (for Institutional and Accredited Investors) regulated by the Monetary Authority of Singapore.