A Glo lobal l Equit ity y Str trategy egy focu cuse sed on - - PowerPoint PPT Presentation

A Glo lobal l Equit ity y Str trategy egy

focu cuse sed on se secu cular lar and disrupti ptive e trends relat ated ed to

Environmental Sustainability & Resource Efficiency

August st 2018

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Agricultural Revolution Industrial Revolution Digital Revolution Sustainability Revolution

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The industrialization of technology is accelerating, disrupting conventional practices

Source: W. Michael Cox, Southern Methodist University, O’Neil Center for Global Markets Annual Report 2015-16, Nanuk extrapolation post 2015

Industrial Revolution Digital Revolution Sustainability Revolution

• Renewable energy
• Energy efficiency
• Industrial efficiency
• Automation
• Collaborative robotics
• Electric vehicles
• Autonomous driving
• Precision agriculture
• Water treatment
• ….

4 Su Sust stain ainable able Technolo logie gies Growth, wth, Comple plexit ity, , Inef effic icienc iency, Disru ruption ption

Environ

• nme

mental al & Res esou

• urce

e Constrai aints Econ

• nomic

c Devel elop

• pme

ment Populat ation

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Growth h & Demog

• grap

aphics Governm ernmen ent Policy New Techn hnol

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• gies

Adv Advan anced ed Manuf ufact actur uring ng Falling ng Techn hnol

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• gy

y Cos

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Multiple influences are driving the transition to more sustainable technologies, products and services

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Solar is now the cheapest st source of new electric icit ity y supply ly globally lly 24hr electr tric icit ity y from m solar and batteries ies is now w competit itive ive with h grid power Autonomo nomous us cars s are drivin ving on our roads s today y (and availabl ilable for hire) 3D printi ting ng of metal l parts s is already y in comme mercia ial l use Off ffshor shore wind power is now as cheap as new w coal l fired power Mass ss market t electr tric ic vehic icles les are availabl ilable today Collabor llaborati tive ve robots ts are already y cheaper than develop loped countr try y labou

• ur costs

ts Drones nes are approved

• ved for comme

mercia ial l use Roboti tic Medical l Equip ipment nt

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Solar PV Equipment & Projects Automotive ADAS Connectors EV & ADAS Components Clean Energy Buses Collaborative Robots Carbon Fibre Industrial & Auto Semiconductors Metal 3D Printing Lithium Battery Chemicals Commercial Drones Composite Materials & Moulds Wind Farms Waste Management Batteries & Environmental Products Residential Solar Leasing Energy Efficiency Project Financing Industrial Batteries Wind Turbines High Speed Rail Aquaculture Biomaterials Energy Infrastructure & Automation Industrial Design Software

Se Sector Fund Weigh ght Se Selected Areas as Of Investm tmen ent Energy Efficiency 25% LED lighting, OLED, building energy efficiency, auto energy efficiency, electrical energy efficiency, vehicle electrification (EVs) Clean Energy 20% Solar, wind, hydro, fuel cells, transmission and distribution, smart metering, energy storage (batteries), biofuels, demand response Industrial Efficiency 22% Factory automation, robotics, ‘internet of things’, commercial drones, 3D printing, advanced manufacturing Waste & Pollution 10% Waste management, waste to energy, recycling, pollution control Food & Agriculture 8% Agricultural equipment, fertilizers, chemicals, food processing, forestry and forest products Advanced Materials 9% Sustainable materials, advanced materials, lightweight materials Water 2% Desalination, water efficiency, waste water processing, water supply, infrastructure Healthcare Technology 3% Wearable devices, diagnostic technology, healthcare solutions, data analytics 7

Sector allocations access a broad range of environmental sustainability-related trends

Source: Nanuk, as at 30 June 2018

50 100 150 200 250 300 350 400 450

MSCI All Country World Total Return Index (AUD) FTSE Environmental Opportunities All-Share Total Return Index (AUD) NANUK New World Strategy (AUD)

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• Environmental challenges and resource constraints necessitate significant longer term

transitions in the global economy

• Medium term outperformance of environmental equities is already evident

Sources: Nanuk, Bloomberg, FTSE Russell, $A, annualised returns. The Nanuk “Strategy” performance constitutes the following: (1) Nanuk New World Fund since launch

• n 2 Nov 2015 , and (2) gross / pre-fee performance of the long book of the Nanuk Global Alpha Fund less an annualized expense ratio of 2.9% (from 31 Jul 2012 to 1 Nov

2015) . NB: Past performance is not an indicator of future performance. Index Return

(AUD, 31 Jul 2018)

1 Yr 15 Yrs

FTSE EOAS 13.1% 10.9% MSCI ACWI 15.0% 7.5% Outperformance

• 1.9%

3.4%

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Robust fund outperformance since inception

Note: NNWF inception date 2 November 2015; AUD Net of fees. Past performance is not indicative of future performance.

Fund Performa mance

(to 31 Jul 2018)

1 1 mt mth 6 6 mt mth 1 1 yr yr 2 2 yr yr

(%pa pa) Since e Inceptio ption (%pa pa)

New World Fund Retu eturn n (%) %) 2.8 7.6 23.3 3 20.5 5 16.2 .2 MSCI ACWI Return (%) 2.4 5.8 19.2 15.2 9.3 Value e Add Added (%) 0.4 .4 1.9 9 4.2 5.3 3 6.9

Nanuk New World Fund FTSE EOAS (benchmark) Bloomberg World Index Number of Stocks 71 515 5,118 Weighted Average Market Cap (US$bn) 36.5 35.3 122.4 Median Market Cap (US$bn) 12.4 2.9 4.2 PE Ratio (FY1) 15.4 18.0 15.3 ROE 21.2% 16.0% 16.9% LT Debt to Capital 29.4% 32.0% 32.1% Forecast 3-5yr EPS growth 11.8% 11.1% 12.6% Dividend Yield 1.8% 2.0% 2.3% Turnover (trailing 12 mths) 52.9% Predicted Volatility (USD returns) 10.9% 11.1% 9.9% vs EOAS vs Bloomberg World Predicted Tracking Error 4.3% 4.6% Downside / Upside Capture (since inception) 94% / 98% 90% / 100%

10 10 10

Higher return on capital and better value than benchmark indices

Sources: Bloomberg, FactSet & Nanuk, as at 31 July 2018

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Name Nanuk New World Fund Type Global equity Legal l Structure cture Registered Australian unit trust Trust stee ee EQT Responsible Entity Services Limited Inves estm tment ent Manager er Nanuk Asset Management Pty Limited Cust stod

• dia

ian/ n/Admini inistra rator tor RBC Investor Services Trust Descri cripti tion

• n

The fund holds a diversified portfolio of global equities in companies potentially benefiting from the broad themes of resource scarcity and environmental sustainability Inves estm tment ent Objecti ective To outperform global equities over the longer term Perfor

• rmanc

nce e Benc nchm hmark rk FTSE Environmental Opportunities All Share Total Return Index (AUD) Sugges este ted Time e Period

• d

Suggested minimum investment timeframe of 5 years Fund Currency ency Australian Dollars Curre renc ncy Hedging ing Direct foreign currency exposure typically remains unhedged. The Fund can use foreign exchange contracts to facilitate settlement of stock purchases and to mitigate currency risk on specific investments within the portfolio Inves estm tments ents Listed equities* 80-100% (typically > 95%); Cash 0-20% *may include derivatives such as total return swaps to gain exposure to the underlying equity Number r of Stocks cks 50 – 100 (typically 60-70) Distri tribution utions Taxable income distributed annually, reinvestment election available Fees s & Expense enses s Management fee 80bps, Administration fee 40 bps. Total fees capped at 120bps. Applicat cations ions & Redempti tions

• ns

Daily Minim imum um Inves estment ent Direct investment - $50,000 (Wholesale Investors only) ; Platform investment – platform minimum Platform

• rm Access

ss BT (Wrap, Panorama, Asgard), Hub24, IOOF Pursuit, Macquarie Wrap, Netwealth, OneVue, Powerwrap

This presentation is prepared by Nanuk Asset Management Pty Ltd (‘Nanuk’) (AFS Licence no. 432119) for wholesale clients only. The information contained in this presentation is of a general nature only, does not take into account the

• bjectives, financial situation or needs of any particular person and is not to be taken into account as containing any

personal investment advice or recommendation. Before making an investment decision, you should consider whether the investment is appropriate in light of those matters. While this presentation has been prepared with all reasonable care, no responsibility or liability is accepted for any errors, omissions or misstatements however caused. No warranty is provided as to the accuracy, reliability and completeness of the information in this presentation and you rely on this information at your own risk. Any prospective yields or forecasts referred to in this presentation constitute estimates which have been calculated by Nanuk’s investment team based on Nanuk’s investment processes and research. To the extent permitted by law, all liability to any person relying on the information contained in this presentation is disclaimed in respect of any loss or damage (including consequential loss or damage) however caused, which may be suffered or arise directly or indirectly in respect of such information. Any past performance information in the presentation is not a reliable indicator of future performance. This presentation should not be construed as an offer to sell or the solicitation of an offer to buy any financial services or financial products. This document is confidential, is intended only for the person to whom it has been delivered and under no circumstance may a copy be shown, copied, transmitted or otherwise given to any person other than the authorised recipient. Performance results are shown for illustration and discussion purposes only. Cover image: NASA Earth Observatory image by Robert Simmon, using Suomi NPP VIIRS data provided courtesy of Chris Elvidge (NOAA National Geophysical Data Center). Suomi NPP is the result of a partnership between NASA, NOAA, and the Department of Defense. 12