PARVEST AQUA MARKETING COMMUNICATION Q1 2017 FOR PROFESSIONAL - - PowerPoint PPT Presentation

PARVEST AQUA

Q1 2017

MARKETING COMMUNICATION

FOR PROFESSIONAL INVESTORS

Impax is a global leader in Environmental Markets investing

1Source: Impax, as at 31 March 2017. Assets under advice represent ~4% of total AUM.

ASSETS UNDER MANAGEMENT AND ADVICE1

WINNER OF NUMEROUS AWARDS

• Dedicated to environmental markets

since 1998

• Global institutional client base
• Established thought leaders
• Offices in London, Hong Kong, New

York, and Portland (Oregon)

• 30 experienced investment team

members

2016 UNPRI assessment: A Policies, Processes, Practices, and Governance

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€26m Sustainable

Property

€6.2bn Listed Equities €439m Renewable

Energy Infrastructure

€6.7bn

AUM

Powerful drivers for environmental products and services

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Impax’s universe and underlying sector classification system is used by FTSE as the basis for FTSE’s Environmental Technologies and Environmental Markets series of indices.

Pollution Finite natural resources Infrastructure deficit Increasing population Rising living standards

Clean energy Water Sustainable food, Agriculture & Forestry Waste/Resource Recovery

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Impax’s classification of Environmental Markets

Adopted by FTSE as a basis for Environmental Technologies and Environmental Markets index series since 2007

Clean energy Sustainable food, Agriculture & Forestry Water Waste/Resource recovery

Energy Efficiency Alternative Energy

• Power Network
• Developers/IPPs
• Industrials
• Solar
• Buildings
• Wind
• Transport
• Biofuels
• Consumer
• Other

Water Infrastructure/ Technologies Pollution Control

• Infrastructure
• Pollution Control Solutions
• Treatment
• Testing & Gas Sensing
• Utilities
• Public Transportation
• Sustainable & Efficient Agriculture
• Logistics, Food Safety & Packaging
• Sustainable Forestry
• Nutrition

Waste Management & Technologies Environmental Support Services

• Tech Equipment
• Consultancies
• Recycling & Processing
• Carbon & Asset Trading
• Hazardous
• Diversified Environmental
• General

LONG-TERM DRIVERS SUPPORT CONTINUED SUPERIOR GROWTH

• Globally, clean water supply and demand imbalances persist
• Inadequate infrastructure and required spending on maintenance
• Continued tightening of water regulations

WATER OPPORTUNITY RUNS THROUGH THE GLOBAL ECONOMY

• Across many end markets and sectors
• Across diverse geographies
• Through all economic cycles

EXPERIENCED INVESTORS WITH PROVEN ABILITY TO ADD VALUE AND MANAGE RISK

• Large global team with significant water equity expertise in under researched themes
• Long track record of outperformance1
• Risk comparable to global markets

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Investing globally in a water equity portfolio

1Past performances or achievement is not indicative of current or future performance.

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Water: the major resource challenge of our times

Source: Impax Asset Management.

In 15 years the planet may meet only 60% of the global demand for water 1bn people lack access to clean water, 2.5bn to sanitation Asia: 60% of global population but only 36% of freshwater resources Global water infrastructure spending needs from 2005-2030: $22.6trn 56% of the world’s irrigated crop production takes place in regions with “high” or “extremely high” water stress 52% of the world’s population live in water-stressed areas worldwide Climate change predicted to lead to further extreme weather events – flooding and drought Water is scarce – and too cheap!

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Trump administration: reasons to be optimistic

Source: iStock and Shutterstock.

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Global trends propel long-term growth in water opportunities

GLOBAL TREND RESPONSE Demand for clean water

• utpaces supply

Water scarcity is a top risk identified by governments, corporations, and academia1 Required investment in global infrastructure $7.5 trillion projected spending globally over next 15 years in water infrastructure2 Tightening global water regulation $300 billion directed to address water pollution by China’s Water 10 Plan3 Adaptation to changing weather patterns Increasing incidence of both drought and flooding cause investment requirements in water systems Innovation and evolving technology New technology and upgrades to existing systems create further investment opportunities

1World Economic Forum | Global Risks 2015; 2McKinsey Global Institute | Bridging Global Infrastructure Gaps – June 2016; 3China Water Risk | New Water Ten Plan to Safeguard

China’s Waters.

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Diverse set of investment opportunities

• Moves across end-markets from consumer to industrial
• Captures cyclical and defensive business models, early to late cycle
• Regional allocation from developed to emerging countries

WATER SECTOR CATEGORIES GROWTH AREA

Water Infrastructure

• Network equipment
• Buildings and industry equipment
• Infrastructure services
• Irrigation
• Infrastructure upgrades
• Smart applications
• Drought resiliency

Water Treatment and Water Efficiency

• Filtration and advanced solutions
• Traditional treatment
• Efficiency
• Testing and monitoring
• Tightening regulation
• Pollution mitigation
• Water reuse

Utilities

• Europe and UK
• US
• Rest of the World
• Energy efficiency
• Infrastructure investment
• Desalination

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Evolving landscape of solutions requires a specialised focus

Water reuse

Treated waste water used to refill depleted aquifers easing groundwater stress

Desalination

Efficient and more cost effective conversion

• f seawater into fresh water

Leak detection

Technological advances in leak detection: less water lost, longer pipe life, lower

• perating costs

Flow measurement

Hardware and software applications for improved measurement and distribution efficiency

Flow efficiency

New technologies disrupting pump markets; utilities investing for energy savings

Smart irrigation

Increased crop yields and efficiency of water use; use of solar power

Treatment, testing and diagnostics

UV disinfection, ozone treatment, handheld instrumentation

Water conservation

New systems reduce consumer water use: home technologies including dual flush

Automated meter reading

Improved water management and real time monitoring; encouraging more efficient use

Data and software

Water industry using big data to map inefficiencies and to develop solutions

• 10.0
• 5.0

0.0 5.0 10.0 15.0 0.0 5.0 10.0 15.0 20.0 25.0 30.0

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Higher returns with risk comparable to global equities

Annualised standard deviation

Past performance is no indication of current or future performance, and the performance data do not take account of the commissions and costs incurred on the issue and redemption of units. Source: FactSet.as at 31 December 2016.

MSCI Energy Annualised return Rogers Int’l Commodity Index MSCI ACWI Brent

Return vs volatility - since inception (Jan 2009)

Impax Water Strategy

Experienced, multidisciplinary investment team1

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Portfolio Construction Team

Chief Executive Investment Risk & Process Trading

Supported by Portfolio Managers and Analysts

Sustainability & ESG Rupert Rink Lisa Beauvilain Jon Forster David Li2 Kirsteen Morrison Michael Landymore

Average investment experience: 18 years; environmental: 11 years

Source: Impax. 1As at 31 March 2017. 2Based in Hong Kong 3 Based in New York. PM: Portfolio Manager. ESG: Environmental, Social, Governance.

Ian Simm Hubert Aarts Co - PM Bruce Jenkyn-Jones Co - PM Sid Jha3 Justin Winter Oscar Yang2 Fotis Chatzimichalakis Agne Rackauskaite David Winborne Dean Palin Simon Higgo

A well diversified portfolio

13 23/05/2017 Source: FactSet, data as at 31 March 2017. Data may not add up to 100% due to rounding. 1Geographic allocation by country of listing, MSCI classification. 2Stability of demand during economic upturns and downturns.

Average ET exposure 65% ALL CAP PORTFOLIO BROADLY DIVERSIFIED ACROSS WATER SUB-SECTORS EXPOSED TO BOTH DEFENSIVE AND CYCLICAL STOCKS2 GLOBAL PORTFOLIO1

(WEIGHTED AVERAGE MARKET CAP: $9.8BN) 48% 34% 7% 6% 2% 4% 63% 23% 5% 9% North America Europe Asia ex Japan Japan ROW Cash Aqua MSCI World

28% 56% 12% 4% 90% 10%

>$10bn $2bn-$10bn <$2bn Cash Aqua MSCI World

Cash 4% Water Infrastructure 38% Water Treatment 32% Water Utilities 25%

43% 52% 1% 4% 48% 44% 8%

Cyclical Defensive Commodity Cash Aqua MSCI World

Source: FactSet, as at 31 March 2017. Total subject to rounding. Data based on BNP Paribas Aqua Fund. 23/05/2017 14

Top 10 holdings

Stock Sub-sector Country % SUEZ Water Utilities France 3.5 Danaher Water Treatment and Efficiency United States 3.4 Ecolab Water Treatment and Efficiency United States 3.2 Veolia Environnement Water Utilities France 3.2 HD Supply Holdings Water Infrastructure United States 3.0 American Water Works Water Utilities United States 3.0 Agilent Technologies Water Treatment and Efficiency United States 3.0 Georg Fischer Water Infrastructure Switzerland 2.8 Rexnord Water Infrastructure United States 2.8 Xylem Water Infrastructure United States 2.7 Total allocation to top 10 holdings 30.7

The above mentioned securities are for illustrative purpose only and do not constitute any investment recommendation

.

Parvest Aqua – P 'Privilege' share (as at 31/03/2017)

Source: BNP Paribas Asset Management. Data as of 31 March 2017. Past performance is no indication of current or future performance, and the performance data do not take account of the commissions and costs incurred on the issue and redemption of units. 23/05/2017 15

www.luxflag.org

• The primary objective of the LuxFLAG Environment Label - non-profit organization - is to

reassure investors that the Investment Fund actually primarily invest their assets in environment-related sectors in a responsible manner. The eligibility criteria for the Environment Label require eligible funds to have a portfolio of investments in environment- related sectors corresponding to at least 75% of the fund’s total assets.

• This label ensures investors that:
• their money is predominantly invested in Environment related sectors in a socially responsible

manner

• their Investment Fund is annually scrutinised by an expert panel and meets internationally

recognised standards in SRI (Sustainable Responsible Investments)

• the fund is committed to going the extra mile in order to deliver confidence and a high service level
• the fund demonstrates a responsible commitment to the ESG values

LuxFLAG Environment Label: What does it mean?

Investors should ensure that they are fully informed about the sub-funds, classes and sub-classes of shares that are authorized to be marketed in their country of residence and the constraints applicable in each of these countries. The investments in the above funds are subject to market fluctuations and the risks inherent in investments in securities. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. 16 23/05/2017

BNPP AM Responsible Investment Policy

As part of our commitment to the UN Principles for Responsible Investment, we incorporate Environmental, Social and Governance (ESG) standards into our investment criteria and ownership practices:

• Investment Criteria are based on the UN

Global Compact principles. They are supplemented by minimum requirements for controversial sectors and products (e.g. anti- personnel landmines, palm oil & wood pulp, nuclear, coal-fired power stations, asbestos)

• Ownership Practices aim to ensure that

voting rights are systematically exercised to foster corporate governance best practices, social responsibility and environmental stewardship

Source: BNP Paribas Investment Partners as at 31 March 2017. 17 23/05/2017

Domicile Luxembourg Registration France, Switzerland, Italy, Germany, Sweden, United-Kingdom, Greece, Ireland, Jersey, Luxembourg, Netherland, Singapore, Liechtenstein, Denmark, Belgium, Portugal, Czech Republic, Hungary, Norway, Slovakia. Legal form1 Subfund of the Parvest UCITS / SICAV Launch date July 2015 Asset class Equities – Worldwide – All caps Benchmark MSCI World EUR (NR) Minimum investment horizon 5 years minimum Base currency Euro SRRI2 6 Fund manager Hubert Aarts Bruce Jenkyn-Jones Maximum management fees 0.9% (Share class I) 1.75% (Share class C) 0.9% (Share class P) Subscription / redemption fees Maximum 3.0% / No redemption fees On-going charges 1.11% (Share class I) as at 30 November 2016 2.24% (Share class C) as at 30 November 2016 1.16% (Share class P) as at 30 November 2016 Management companies BNP Paribas Asset Management Delegated management company : Impax Asset Management ISIN codes Share class I : LU1165135952 Share class C : LU1165135440 Share class P: LU1165135879

1Investors should ensure that they are fully informed about the sub-funds, classes and sub-classes of shares that are authorized to be marketed in their country of residence and the constraints applicable in each of these countries. The investments in the above funds are subject to market fluctuations and the risks inherent in investments in securities. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. 2The synthetic risk indicator is determined on a scale from 1 to 7 (7 being the highest risk level). It is subject to a periodical computation and can consequently change over time. We invite you to consult regularly the KIID. Past performance is no indication of current or future performance, and the performance data do not take account of the commissions and costs incurred on the issue and redemption of units. The prospectus, the KIID, the statutes and the annual and semi-annual reports can be obtained, free of charge, from the representative in Switzerland, BNP Paribas (Suisse) SA, 2, place de Hollande, 1204, Geneva; the paying agent in Switzerland is BNP Paribas Securities Services, Paris, succursale de Zurich, 16, Selnaustrasse, 8002 Zurich.

Fund characteristics: Parvest Aqua

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Risk factors on the Aqua funds

Parvest Aqua, BNP Paribas Aqua, BNP Paribas L1 Equity World Aqua

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The funds may be exposed to risks defined below:

• Risk of capital loss : the investments in the funds are subject to market fluctuations and the risks inherent in

investments in securities. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay, the funds described being at risk of capital loss. For a complete description and definition of risks, please consult the last available prospectus and KIID of the funds. Investors considering subscribing to a fund should read carefully its most recent prospectus and KIID that can be downloaded free of charge from our site www.bnpparibas-am.ch

• Risk linked to Share Markets : the risks associated with investments in shares (and similar instruments) include

significant fluctuations in prices, negative information about the issuer or market and the subordination of a company’s shares to its bonds. The value of investments and the income they generate may go down as well as up and it is possible that investors will not recover their initial outlay. Subfunds investing in growth stocks may be more volatile than the market in general and may react differently to economic, political and market developments and to specific information about the issuer.

• Small-Cap risk : investing in small caps are likely to be subject to a higher than average volatility due to a high degree
• f concentration, greater uncertainty because less information is available, there is less liquidity, or due to greater

sensitivity to changes in market conditions (social, political and economic conditions).

• Emerging market risk : investing in emerging markets are likely to be subject to a higher than average volatility due to

a high degree of concentration, greater uncertainty because less information is available, there is less liquidity, or due to greater sensitivity to changes in market conditions (social, political and economic conditions). Some emerging markets

• ffer less security than the majority of international developed markets. For this reason, services for portfolio

transactions, liquidation and conservation on behalf of funds invested in emerging markets may carry greater risk

APPENDIX

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INVESTMENT UNIVERSE BASED ON BUSINESS EXPOSURE TO THEMATIC OPPORTUNITIES

• Screened to remove illiquid names and frontier market listings
• Quantitative filters used to identify top quality companies meeting Impax’s financial criteria

EXTENSIVE SECTOR AND COMPANY RESEARCH BY ANALYSTS

• Thematic sectors and subsectors evaluated for growth catalysts
• Companies assessed for long-term (5+ years) potential
• “10 Step” review, including ESG1 risk analysis developed
• Proprietary valuation model flexed with Monte Carlo analysis

PORTFOLIO CONSTRUCTION AND MANAGEMENT REFLECTS:

• Highest conviction names
• Largest upside to “fair value” (“GARP2”)
• Risk limits (hard and soft)
• Information from a macro and thematic overlay (updated quarterly)
• Low turnover approach, principally trimming or adding to core names

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Investment process

1ESG: Environmental, Social, Governance. 2GARP : Growth at a Reasonable Price.

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Investment process - schematic

Portfolio construction

All Global Equities Revenue analysis Identification of water revenues Initial screening Viper screening & financial scoring, initial ESG analysis, financial analysts, brokers, company contacts Quality companies identified ‘10 Step’ review, VIPER valuation model, full ESG risk analysis “A-list” Investment Committee A-list approval

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Top down views enhance portfolio construction

Stronger Weaker

LEGEND

Impax water subsector themes analysis Q2 2017

Market conditions reflect both external (e.g. cyclical) and internal (e.g. competition, technological disruption) factors. Valuation is by sub-sector individually, based on reversion to the mean and correlation to subsequent sub-sector performance, all measured quarterly over the past 10 years. Source: Impax as at 31 March 2017.

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Performance Parvest Aqua – P share

All All figures figures net net of

• f fees

fees (in EUR) *annualised performance **first NAV date: 04/12/2008 annualised Ongoing charges: 1.16 % Performance Source: BNP PARIBAS Securities Services as at 31 March 2017. Past performance is no indication of current or future performance, and the performance data do not take account of the commissions and costs incurred on the issue and redemption of units. 23/05/2017

Performance at the end of March 2017 March Last 3M YTD Last Last Last Last Since Privilege Share (Net of fees - %) 12M 24M* 36M* 60M* inc.,** Parvest Aqua 2,15 7,23 7,23 22,37 8,75 15,15 15,39 17,19

MSCI World (NR)

0,41 4,90 4,90 22,28 5,48 14,82 14,26 14,62 Excess return 1,74 2,33 2,33 0,10 3,27 0,33 1,13 2,57 Performance History (%) - Full year 2016 2015 2014 2013 2012 Parvest Aqua 13,02 12,07 15,49 22,44 21,82

MSCI World (NR)

10,73 10,42 19,50 21,20 14,01 Excess return 2,29 1,65

• 4,01

1,23 7,81 Performance History (%) - March to March 2016-17 2015-16 2014-15 2013-14 2012-13 Parvest Aqua 22,37

• 3,36

29,11 13,07 18,49

MSCI World (NR)

22,28

• 9,01

36,06 10,81 16,08 Excess return 0,10 5,65

• 6,96

2,26 2,41 Risk indicators (annualised) Last 36W Last 52W Last 24M Last 36M Last 60M Since inc.,** Fund volatility (%) 12,70 12,28 12,65 11,94 10,54 12,21

MSCI World (NR)

11,67 12,06 12,94 11,67 10,05 11,43 Tracking error (%) 5,40 5,08 4,84 5,40 4,97 5,95 Information ratio 0,43 0,02 0,67 0,06 0,23 0,43

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Disclaimer

This material is issued and has been prepared by BNP Paribas Asset Management S.A.S. (BNPP AM)* a member of BNP Paribas Investment Partners (BNPP IP)**. This material is produced for information purposes only and does not constitute:

• 1. an offer to buy nor a solicitation to sell, nor shall it form the basis of or be relied upon in connection with any contract or commitment whatsoever or
• 2. any investment advice .

This material makes reference to certain financial instruments (the “Financial Instrument(s)”) authorised and regulated in its/their jurisdiction(s) of incorporation. No action has been taken which would permit the public offering of the Financial Instrument(s) in any other jurisdiction, except as indicated in the most recent prospectus, offering document or any other information material, as applicable, of the relevant Financial Instrument(s) where such action would be required, in particular, in the United States, to US persons (as such term is defined in Regulation S of the United States Securities Act of 1933). Prior to any subscription in a country in which such Financial Instrument(s) is/are registered, investors should verify any legal constraints or restrictions there may be in connection with the subscription, purchase, possession or sale of the Financial Instrument(s). Investors considering subscribing for the Financial Instrument(s) should read carefully the most recent prospectus, offering document or other information material and consult the Financial Instrument(s)’ most recent financial reports. The prospectus, offering document or other information of the Financial Instrument(s) are available from your local BNPP IP correspondents, if any, or from the entities marketing the Financial Instrument(s). Opinions included in this material constitute the judgment of BNPP AM at the time specified and may be subject to change without notice. BNPP AM is not obliged to update or alter the information or opinions contained within this material. Investors should consult their own legal and tax advisors in respect of legal, accounting, domicile and tax advice prior to investing in the Financial Instrument(s) in order to make an independent determination of the suitability and consequences of an investment therein, if permitted. Please note that different types of investments, if contained within this material, involve varying degrees of risk and there can be no assurance that any specific investment may either be suitable, appropriate or profitable for a client or prospective client’s investment portfolio. Given the economic and market risks, there can be no assurance that the Financial Instrument(s) will achieve its/their investment objectives. Returns may be affected by, amongst other things, investment strategies or objectives of the Financial Instrument(s) and material market and economic conditions, including interest rates, market terms and general market

• conditions. The different strategies applied to the Financial Instruments may have a significant effect on the results portrayed in this material. Past performance is not a guide to future

performance and the value of the investments in Financial Instrument(s) may go down as well as up. Investors may not get back the amount they originally invested. The performance data, as applicable, reflected in this material, do not take into account the commissions, costs incurred on the issue and redemption and taxes. *BNPP AM is an investment manager registered with the “Autorité des marchés financiers” in France under number 96002, a simplified joint stock company with a capital of 70,300,752 euros with its registered office at 1, boulevard Haussmann 75009 Paris, France, RCS Paris 319.378.832. www.bnpparibas-ip.com. ** “BNP Paribas Investment Partners” is the global brand name of the BNP Paribas group’s asset management services. The individual asset management entities within BNP Paribas Investment Partners if specified herein, are specified for information only and do not necessarily carry on business in your jurisdiction. For further information, please contact your locally licensed Investment Partner. Past performance is no indication of current or future performance, and the performance data do not take account of the commissions and costs incurred on the issue and redemption of units. The prospectus, the KIID, the statutes and the annual and semi-annual reports can be obtained, free of charge, from the representative in Switzerland, BNP Paribas (Suisse) SA, 2, place de Hollande, 1204, Geneva; the paying agent in Switzerland is BNP Paribas Securities Services, Paris, succursale de Zurich, 16, Selnaustrasse, 8002 Zurich.