gresham house strategic plc investor presentation
play

Gresham House Strategic Plc Investor Presentation 28 February 2018 - PowerPoint PPT Presentation

Gresham House Strategic Plc Investor Presentation 28 February 2018 Disclaimer This presentation (the Presentation) is issued by Gresham House Asset The internal rates of return or IRRs presented on a gross basis do not reflect any


  1. Gresham House Strategic Plc Investor Presentation 28 February 2018

  2. Disclaimer This presentation (the “Presentation”) is issued by Gresham House Asset The internal rates of return or IRRs presented on a “gross” basis do not reflect any Management Ltd (“GHAM”), Investment Manager for Gresham House Strategic plc management fees, carried interest, taxes and allocable expenses of the kind that will (“GHS”) for information purposes only. This Presentation, its contents and any be borne by investors in a fund, which in the aggregate may be substantial. information provided or discussed in connection with it are strictly private and Prospective investors are reminded that the actual performance realised will depend confidential and may not be reproduced, redistributed or passed on, directly or on numerous factors and circumstances some of which will be personal to the indirectly, to any other person or published, in whole or in part, for any purpose, investor. without the consent of GHAM (provided that you may disclose this Presentation on a Statements contained in this Presentation that are not historical facts are based on confidential basis to your legal, tax or investment advisers (if any) for the purposes of current expectations, estimates, projections, opinions and beliefs of GHAM. Such obtaining advice). Acceptance of delivery of any part of the Presentation by you statements involve known and unknown risks, uncertainties and other factors, and constitutes unconditional acceptance of the terms and conditions of this notice. undue reliance should not be placed thereon. In addition, this Presentation contains “forward - looking statements.” Actual events or results or the actual performance of This Presentation does not itself constitute an offer to subscribe for or purchase any interests or other securities. This Presentation is not intended to be relied upon as the Fund may differ materially from those reflected or contemplated in such forward- the basis for an investment decision, and is not, and should not be assumed to be, looking statements. complete. It is provided for information purposes only. Any investment is subject to Certain economic and market information contained herein has been obtained from various risks, none of which are outlined herein. All such risks should be carefully published sources prepared by third parties and in certain cases has not been considered by prospective investors before they make any investment decision. updated to the date hereof. While such sources are believed to be reliable, neither You are not entitled to rely on this Presentation and no responsibility is accepted by GHAM, GHS nor any of its directors, partners, members, officers, employees, GHAM, GHS or any of its directors, officers, partners, members, employees, agents advisers or agents assumes any responsibility for the accuracy or completeness of or advisers or any other person for any action taken on the basis of the content of such information. this Presentation. Neither GHAM, GHS nor any other person undertakes to provide No person, especially those who do not have professional experience in matters the recipient with access to any additional information or to update this Presentation relating to investments, must rely on the contents of this Presentation. If you are in or to correct any inaccuracies therein which may become apparent. any doubt as to the matters contained in this Presentation you should seek independent advice where necessary. This Presentation has not been submitted to No undertaking, representation, warranty or other assurance, express or implied, is or approved by the securities regulatory authority of any state or jurisdiction. made or given by or on behalf of GHAM, GHS or any of its respective directors, officers, partners, members, employees, agents or advisers or any other person as to For the Attention of United Kingdom Investors the accuracy or completeness of the information or opinions contained in this Presentation and no responsibility or liability is accepted by any of them for any such This Presentation is intended for distribution in the United Kingdom only to persons information or opinions. who: (i) have professional experience in matters relating to investments, (ii) who are investment professionals, high net worth companies, high net worth unincorporated Past performance is not indicative of future results. The value of investments may fall associations or partnerships or trustees of high value trusts, and (iii) investment as well as rise and investors may not get back the amount invested. Changes in personnel of any of the foregoing (each within the meaning of the Financial Services rates of foreign exchange may cause the value of investments to go up or down. No and Markets Act 2000 (Financial Promotion) Order 2005). representation is being made that any investment will or is likely to achieve profits or losses similar to those achieved in the past, or that significant losses will be avoided. For the Attention of Investors outside the United Kingdom Prospective investors should seek their own independent financial, tax, legal and This Presentation relates to an Alternative Investment Fund within the meaning of the other advice before making a decision to invest. Alternative Investment Fund Managers Directive and the availability of this Presentation will be subject to registration in relevant jurisdictions as described in the documents relating thereto. Any dissemination or unauthorised use of this Presentation outside the United Kingdom by any person or entity is strictly prohibited. | PAGE 2

  3. Gresham House Strategic plc - The Opportunity ▪ Compelling opportunity to buy at a 29.9% discount to NAV 1 ▪ Concentrated portfolio with considerable potential upside, attractively valued and tracking in line with investment manager’s thesis ▪ Portfolio valued at a discount to market together with share price discount to NAV creates a ‘double discount’ ▪ Proven team - long term 20-year track record 2 ▪ Right timing – Focused on undervalued areas (Small- Source: Bloomberg, as at 6 March 2018 Cap, Value) in a market that is increasingly favouring GHS Portfolio Metrics vs. Indices stock-pickers 3 FTSE FTSE All FTSE GHS GHS Small Share AIM ▪ Current 4 Forecast 4 Intention to continue dividend payments following Cap Current Current Current maiden 15p dividend and share buyback in April EV:Sales 0.8x 0.7x 1.1x 1.4x 1.7x 2017 EV:EBITDA 6.2x 5.0x 7.9x 8.0x 13.2x Sales Growth 16% N/A 5% 4% 9% -0.3x -0.4x Net. (cash (cash 2.0x 1.3x 0.5x Debt:EBITDA positive) positive) 1 Discount to NAV as of 28 February 2018 and using GHS mid-price of 822.50p Source: Bloomberg Data for FTSE All-Share, Small Cap and AIM market, Company Accounts and House Broker Forecasts for GHS Portfolio Holdings as of 28 February 2018. 2 See slide 8 3 “Stock Pickers are poised to reap gains from falling correlations” Cormac Mullen, Bloomberg, 4 August 2017 4.GHS Current and Forecast values strip out 3 investments that currently are private companies and do not have public forecasts and 1 public company that has forecasts under review (Quarto plc). Metrics take into account the discount to NAV and are calculated at a portfolio level. | PAGE 3

  4. Public Equity – The Market Opportunity Smaller companies attractively priced FTSE All Share median EV/EBITDA multiple (x) 15.0 ▪ The valuation differential between large stocks above 11.8 9.5 £250m and smaller, less liquid stocks is significant 10.0 ▪ The valuation dislocation has been increasing 5.0 ▪ Significant opportunity to generate superior long-term 0.0 returns investing in good quality, intrinsically Mkt Cap below £250m Mkt Cap above £250m undervalued smaller companies Source: Bloomberg 29 December 2017 Value Versus Growth Value stocks set to outperform 2.0 +2 Std Dev ▪ Recent relative under-performance of value versus 1.8 +1 Std Dev 1.6 growth provides potentially strongest argument for value Trend 1.4 -1 Std Dev in 40 years 1.2 -2 Std Dev ▪ Stocks with value characteristics have been overlooked 1.0 for much of the last five years 0.8 0.6 Source: Bloomberg data to 29 December 2017 | PAGE 4

  5. Public Equity – Investment Opportunity Influential minority stakes Gresham House Value Enhancement (5%-25%) and active management of investments (including Board introductions, advisory) Strategic and Provision of Corporate Capital Advice Highly engaged strategy Adding value as an active investor supporting strong Access to Operational Sector management teams Improvement Experts and Directors Investor Targeting inefficient areas of public markets Relations and Market Engagement Smaller companies (illiquid, under researched, barriers to growth capital) Focus on profitable, cash generative companies GHS offers investors a Which are intrinsically undervalued and can benefit from portfolio of investments that are strategic, operational or management initiatives currently… Thorough diligence to identify value creation catalysts 3) Forecast to grow 1) Less expensive than Improved return on capital, profit growth, multiple faster the market expansion, debt reduction and cash returns Flexible mandate up to 30% can be invested in unquoted 2) Supported by Pre-IPO, direct private equity, P2P, preferred positions stronger balance sheets | PAGE 5

Download Presentation
Download Policy: The content available on the website is offered to you 'AS IS' for your personal information and use only. It cannot be commercialized, licensed, or distributed on other websites without prior consent from the author. To download a presentation, simply click this link. If you encounter any difficulties during the download process, it's possible that the publisher has removed the file from their server.

Recommend


More recommend