REST Investor Briefing Investor Briefing

Transcription

1 REST Investor Briefing

2 Damian Hill Chief Executive Officer 2

3 Disclaimer This presentation contains general advice current as at March 2017 and has been prepared without taking account of your objectives, financial situation or needs. Before making any decision about our products based on this information, consider how appropriate it is for your own objectives, financial situation and needs and consider the Product Disclosure Statement (PDS) available from us before making any decision about whether to acquire or to continue to invest in the product. REST has no relationships that might influence our advice to you. REST does not pay or receive commissions. When you become a member of REST you join the Retail Employees Superannuation Trust ABN Acumen, REST Super, REST Select, REST Corporate and REST Pension are issued by Retail Employees Superannuation Pty Limited, ABN , AFSL

4 Overview of REST as at 31 December 2016 * Current as at 31 Dec 2016 ^ Number of working Australian sourced from Australian Bureau of Statistics, 2016, Labour force, Australia, (cat. no ), Dec

5 Another year of change Federal election in 2016 Brexit and Frexit, Turnbull and Trump Federal Budget 2016 measures passed in November 2016 Fair and Sustainable Super Centrelink assets test and taper rate changes effective 1 January

6 Core Strategy performance (as at January 2017) 10 year per annum 7 year per annum 5 year per annum 3 year per annum 1 year Core Strategy 6.20% 8.39% 10.20% 7.07% 10.27% Median 5.01% 7.85% 9.31% 7.29% 9.69% Relative performance compared to median balanced options Ranking against balanced options +1.19% +0.54% +0.89% -0.22% +0.58% 1/41 11/46 7/47 29/48 15/48 SuperRatings Fund Crediting Rate Survey January 2017, SR50 Balanced (60-76) Index. Returns are net of investment fees, tax and implicit asset-based administration fees. Explicit fees such as fixed dollar administration fees, exit fees, contribution fees and switching fees are excluded. Returns for periods greater than one year returns have been annualised. Past performance is not an indicator of future performance. Ratings, awards or investment returns are only some of the factors that you should consider when deciding how to invest your super. SuperRatings Pty Limited does not issue, sell, guarantee or underwrite this product. Go to superratings.com.au for details of its ratings criteria. 6 6

7 Annualised returns (% p.a.) Higher the better Focus on competitive long-term returns and fees remains yr Annualised Returns vs Annual Fees Median REST - Core Strategy Source: SuperRatings. The chart comprise the largest 25 public offer accumulation default options (excluding Corporate and Government plans) by funds under management with 10 year performance as at 31/12/2016. Excluded are those funds where option size data is not provided and those options that no longer exist. Returns are net of investment fees, tax and implicit asset-based administration fees. Explicit fees such as fixed dollar administration fees, exit fees, contribution fees and switching fees are excluded. Fees includes percentage-based administration fees, member fees, investment management fees, performance-based fees and taxes, but exclude any applicable employer rebates, as at 31/12/16. Past performance is not an indicator of future performance. Lower the better Fee on $50,000 Account Balance^ (in $)

8 Delivering real net benefits to our members How $100,000 in REST Core Strategy compared to SuperRatings Worst and Median Performing Balanced Fund Dec 2006 to Dec 2016* Worst performing Median performing $160,469 REST Core Strategy $186,113 $124,024 Source: SuperRatings Fund Crediting Rate Survey SR50 Balanced (60-76) Index, December Growth in $100,000 over the past 10 years from Dec 2006 to Dec Returns are net of investment fees, tax and implicit asset-based administration fees. Explicit fees such as fixed dollar administration fees, exit fees, contribution fees and switching fees are excluded. Ratings or investment returns are only one factor that you should consider when deciding how to invest your super. Past performance is not an indicator of future performance. SuperRatings Pty Limited does not issue, sell, guarantee or underwrite this product. Go to superratings.com.au for details of its ratings criteria. 8

9 What s new at REST 9

10 REST Advice for members Right advice, for the right need, at the right time Online Phone Face to face 10

11 Brendan Casey General Manager Investments 2017 Investor Briefing 11

12 Brexit, Trump what does this all mean? Global Equities Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Jul 16 Aug 16 Sep 16 Oct 16 Nov 16 Dec 16 Jan 17 Feb 17 Mar 17 US presidential campaigns Trump inauguration Where next? BREXIT Trump wins US election Source: Bloomberg Global equities represented by the MSCI All Country World Index (in USD), from 1 Jan 2016 to 6 March

13 A year of ups and downs Global Bonds Global Equities Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Jul 16 Aug 16 Sep 16 Oct 16 Nov 16 Dec 16 Jan 17 Feb 17 Mar 17 Source: Bloomberg Data shown from 1 Jan 2016 to 6 March 2017 Global equities are represented by the MSCI All Country World Index (in USD), normalised to 100 Global bonds are represented by the Bloomberg Global Developed Sovereign Bond Index (in USD), normalised to

14 What is REST doing? June 16 Jan 17 Reduce exposure to growth assets Total Growth Assets 80% Total Growth Assets 76% Looking beyond traditional asset classes Aust & Overseas Shares 53% Aust & Overseas Shares 43% Seeking diversified sources of returns Growth Alternatives 12% Growth Alternatives 18% Managing risks & looking for market opportunities Cash 6% Cash 11% This information relates to REST Core Strategy 14

15 Investing in Australian companies REST Australian Equities Portfolio Holdings CSL 2.9% TELSTRA 2.7% OTHER 48.2% WOODSIDE PETROLEUM 2.4% MACQUARIE GROUP 2.3% BRAMBLES 1.9% RIO TINTO 1.8% QBE 1.7% WOOLWORTHS 1.6% ALUMINA 1.6% WESFARMERS 3.5% NAB 3.7% ANZ 4.0% CBA 5.0% BHP 5.3% WESTPAC 5.2% ORIGIN ENERGY 1.5% AURIZON 1.2% BORAL 1.2% AGL ENERGY 1.2% AMCOR 1.2% Information as at 31 December

16 Investments in NSW VIC 37% Location of REST s Australian Property Portfolio QLD 15% SA 1% WA 4% ACT 4% NSW 40% 52 Martin Place Sydney NSW 60 Station Street Parramatta NSW Mung Bean Harvest Boolavilla NSW Location of REST's Infrastructure Portfolio SA 30% VIC/TAS 45% NSW 8% WA 17% Castle Towers Castle Hill NSW Darling Park & Cockle Bay Wharf Sydney NSW M5 South-West Motorway Interlink Roads Information as at 31 December

17 Investments in Victoria Location of REST s Australian Property Portfolio NSW 40% ACT 4% WA 4% SA 1% VIC 37% QLD 15% 140 William Street Melbourne VIC 717 Bourke Street Melbourne VIC Melbourne Airport Location of REST's Infrastructure Portfolio WA 17% NSW 8% SA 30% VIC/TAS 45% 570 Bourke Street Melbourne VIC 11 Exhibition Street Melbourne VIC Baingarra VIC Information as at 31 December

18 Investments in Queensland Location of REST s Australian Property Portfolio NSW 40% VIC 37% Big Top Shopping Centre Maroochydore QLD Sorghum Wyobie QLD 275 George Street Brisbane QLD QLD 15% ACT 4% SA 1% WA 4% Aurizon, 900 Ann Street Fortitude Valley QLD One One One Eagle Street Brisbane QLD Griffith University Village Southport QLD Information as at 31 December

19 Investments in Western Australia Location of REST s Australian Property Portfolio NSW 40% VIC 37% ACT 4% WA 4% SA 1% QLD 15% Bankwest Place Perth WA 225 St Georges Terrace Perth WA Canola Harvest Mawarra WA Location of REST's Infrastructure Portfolio VIC/TAS 45% SA 30% WA 17% Collgar Wind Farms Merredin WA Dampier to Bunbury Pipeline EduWest WA Public Schools Project NSW 8% Information as at 31 December

20 Investments in South Australia Location of REST s Australian Property Portfolio VIC 37% NSW 40% ACT 4% WA 4% SA 1% QLD 15% ATO Franklin Street Adelaide SA Bank SA 97 King William Street Adelaide SA NSW 8% Location of REST's Infrastructure Portfolio SA 30% VIC/TAS 45% WA 17% SEAGas Gas pipeline from Port Campbell to Adelaide Information as at 31 December

21 Managing through all market conditions REST Super Core Strategy Annual Returns (p.a.) 20% REST Super Core Strategy Cumulative Returns 1000% 15% 900% 800% 10% 700% 600% 5% 500% 400% 0% 300% -5% 200% 100% -10% 0% Source: REST. Performance since inception as at 30 June. Performance is net of investment fees and tax. The earnings applied to each members accounts may differ. Past performance may not be repeated 21

22 Managing through all market conditions REST Pension Balanced Annual Returns (p.a.) 16% 14% 12% 10% REST Pension Balanced Cumulative Returns 200% 175% 150% 8% 6% 4% 2% 125% 100% 75% 0% -2% -4% 50% 25% -6% 0% Source: REST. Performance since inception as at 30 June. Performance is net of investment fees. The earnings applied to each members' accounts may differ. Past performance may not be repeated 22

23 Jun 15 Jul 15 Aug 15 Sep 15 Oct 15 Nov 15 Dec 15 Jan 16 Feb 16 Mar 16 Apr 16 May 16 Jun 16 Jul 16 Aug 16 Sep 16 Oct 16 Nov 16 Dec 16 Jan 17 Feb 17 For better long term outcomes $11,200 $11,000 $10,967 $10,800 $10,600 $10,400 This time last year Twelve months on $10,200 $10,000 $10,000 $9,800 $9,600 $9,697 $9,400 Source: REST Initial investment amount of $10,000 invested in REST Super Core Strategy, starting 30 June 2015 to 7 March Performance is net of investment fees and tax. The earnings applied to each members' accounts may differ. Past performance may not be repeated. 23

24 For better long term outcomes REST Super Core Strategy Investing $10,000 over different time periods $30,000 Best $26,472 $25,000 $20,000 Best $17,780 Worst $18,406 $15,000 $10,000 Best $12,106 Worst $10,867 $5,000 Worst $8,422 $0 1 year 5 years 10 years Source: REST The above chart shows the best and worst returns of the REST Super Core Strategy option for each time period since inception (July 1988 to Dec 2016). Performance is net of investment fees and tax. The earnings applied to each members' accounts may differ. Past performance may not be repeated. 24

25 For better long term outcomes REST Pension Balanced Investing $10,000 over different time periods $30,000 $25,000 Best $22,485 $20,000 Best $17,726 Worst $18,387 $15,000 $10,000 Best $11,823 Worst $11,481 $5,000 Worst $8,737 $0 1 year 5 years 10 years Source: REST The above chart shows the best and worst returns of the REST Pension Balanced option for each time period since inception (Sept 2002 to Dec 2016). Performance is net of investment fees. The earnings applied to each members' accounts may differ. Past performance may not be repeated. 25

26 Sep 88 Sep 89 Sep 90 Sep 91 Sep 92 Sep 93 Sep 94 Sep 95 Sep 96 Sep 97 Sep 98 Sep 99 Sep 00 Sep 01 Sep 02 Sep 03 Sep 04 Sep 05 Sep 06 Sep 07 Sep 08 Sep 09 Sep 10 Sep 11 Sep 12 Sep 13 Sep 14 Sep 15 Sep 16 Quarterly Excess Return Cumulative Outperformance Managing through all market conditions Performance of REST Core Strategy Quarterly excess returns vs peers since July % 6% 5% 4% 3% 2% 1% 0% -1% -2% -3% -4% -5% -6% -7% Rising Falling Cumulative 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% -5% -10% -15% -20% -25% -30% -35% -40% -45% -50% Average Outperformance (overall) 0.38% Average Outperformance (in rising markets) -0.37% Average Outperformance (in falling markets) 2.44% Source: JANA Investment Advisers. Median Mercer Balanced Manager prior to 1 July 2009, SuperRatings Balanced (60-76) survey category thereafter. Returns are net of investment fees and taxes. Past performance is not an indication of future performance. 26

27 Andrea Haley National Manager Member Relations 27

28 Some of the Federal Government s key changes to super Introduction of a $1.6 million transfer balance cap from 1 July 2017 Removal of the tax exemption on investment earnings for transition to retirement pension (TTR) from 1 July 2017 Cut in annual concession (before-tax) contributions cap to $25,000 from 1 July 2017 Cut in annual non-concession (after-tax) contributions cap to $100,000 from 1 July

29 Changes to super continued Contribution caps Financial Year Concessional Contributions Cap * Non-concessional Contributions Cap # Under 50: $30, and over: $35, $25,000 From 1 July 2018, there will be a carry forward option for up to 5 years worth of any unused portion of the Concessional Contribution Cap provided you have a super balance under $500,000. Tax on amounts over the cap Your marginal tax rate plus Medicare Levy plus 49% excess concessional contributions charge + $180,000 or $540,000 over 3 years (under 65) Annual $100,000 cap up to $300,000 over a 3 year period. Non-concessional contributions will only be allowed if your account balance is below $1.6 million. Source: Income Tax Assessment Act 1997 * Includes employer contributions (including salary sacrifice contributions), and personal contributions claimed as a tax deduction by a self-employed person. The lower cap is subject to indexing. # Includes personal contributions for which an income tax deduction is not claimed. + A 15% tax offset will be applied in the member s tax return before the excess concessional contribution charge is applied. Up to 85% of the amounts above the concessional contributions cap can be released from the super fund to pay the tax. This includes Temporary Budget Repair Levy of 2%. The Temporary Budget Repair Levy Tax is payable by anyone earning $180,000 or more for the 2016/2017 year. 29

30 REST Pension 30

31 How much is enough? Average household budgets per year in retirement^ (aged around 65): Modest Comfortable Modest retirement: Better than the Age Pension, but still only able to afford fairly basic activities Single Couple Single Couple Total per year $23,996 $34,560 $43,372 $59,619 The above figures apply for those aged around 65. Different figures apply to those aged around 85 and are available on ASFA website. Comfortable retirement: Regular leisure activities Private health insurance Reasonable car Good clothes Electronic equipment One annual holiday in Australia ^ Source: Association of Superannuation Funds of Australia (ASFA) Retirement Standard, September quarter Updated quarterly to reflect inflation. The figures in each case assume that the retiree(s) own their own home, aged around 65, are relatively healthy and relate to expenditure by the household. This can be greater than household income after income tax where there is a drawdown on capital over the period of retirement. Single calculations are based on female figures. 31

32 Retirement savings needed Annual expenditures needed for a comfortable lifestyle as at September 2016 is $43,372 for a single and $59,619 for a couple Lump sum needed at retirement to support a comfortable lifestyle + (assumes receipt of part Age Pension) Couple $640,000 Single person $545,000 + Source: Association of Superannuation Funds of Australia (ASFA) Retirement Standard, September quarter The lump sums required for a comfortable retirement assume that retiree(s) will draw down all their capital, and receive a part Age Pension. Figures in today s dollars using 3.75% AWE as a deflator and an assumed investment earning rate of 7 per cent. Based on the means test for the Age Pension in effect from 1 January

33 REST Pension features Award-winning* with competitive long-term performance Low fees Range of payment and investment options Transition to retirement option Concessional tax treatment REST does not pay or receive commissions * Ratings and awards are not the only factors you should consider when deciding how to invest your super. For more information on our awards visit rest.com.au/ourawards. Past performance is not an indicator of future performance. SuperRatings Pty Limited does not issue, sell, guarantee or underwrite this product. Go to superratings.com.au for details of its ratings criteria. 33

34 Q&A with REST 34