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    Henderson global investors Henderson global investors Presentation Transcript

    • This document is solely for the use of professionals and is not for general public distributionCorporate EuropeFitter, leaner, meaner?Tim StevensonFund Manager, Pan European Equities November 2011HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Henderson Horizon Pan European Equity FundOverview Launched in 2001 Horizon Pan European Equity team Focus on quality, consistent, Tim Stevenson reliable companies Fund Manager 28-years’ investment experience Joined Henderson in 1986 Large-cap, liquid portfolio William Stormont Fund Manager 11-years’ investment experience No more than 60 holdings Joined Henderson in 2007 €2.3bn assets under management Maximum cash 5% (except in exceptional circumstances) Source: MorningStar, Henderson Global Investors, 30 September 2011 Minimum position size 1% Quartile ranks at 31 October 2011Top quartile performance over 1, 3 and 5 years 1HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Defining our ideal investment Strong market Growing end position markets Quality management Model Strong balance with sound company sheet strategy Consistent Attractive valuation growth 2HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Performance - quality pays in the long run Fund (%) FTSE Europe Index (%) Percentile rank 3 months -4.9 -8.0 13 Year to date -7.1 -9.1 17 1 year -3.5 -5.6 21 3 years +28.6 +21.6 20 5 years -5.2 -17.8 8 Since inception (Nov 2001) +53.0 +15.3 3 Risk (volatility) Fund (%) Benchmark (%) 1 year 16.4 17.2 3 year 15.2 18.3 5 year 15.8 18.5 Since inception 15.2 17.0Source: Henderson Global Investors, 31 October 2011Note: Net of fees in EurosTenth year of adding value 3HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Macro environment and corporate health 4HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Macro environmentAn ever changing landscapeGrowth US – OK China and Emerging Markets – also OK Europe – poor, flat at best 5HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Macro environmentRecent events EFSF expansion Greece forced to toe the line to achieve 50% write-offs Politicians taking a harder line with enforcing Euro membership rules New Head of the ECB – making his mark 6HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • European companies are in good shape Cash balances reaching new highs Leverage has decreased 900 3.0 European cash on corporate balance sheets (€bn) European companies net debt to EBITDA (Ex financials) 800 2.5 700 2.0 600 500 1.5 400 1.0 300 0.5 200 100 0.0 0 -0.5 Q3 2001 Q2 2002 Q1 2003 Q4 2003 Q3 2004 Q2 2005 Q1 2006 Q4 2006 Q3 2007 Q2 2008 Q1 2009 Q4 2009 Q3 2010 Q2 2011 Jun-81 Jun-84 Jun-87 Jun-90 Jun-93 Jun-96 Jun-99 Jun-02 Jun-05 Jun-08 Jun-11Source: Worldscope, UBS, Dealogic, Credit Suisse research, Henderson Global Investors, at 30 September 2011 7HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Stock example – FreseniusInvestment case Dividend Growth 1.0 Global healthcare provider 0.86 0.76 0.8 0.67 0.71 EUR 0.58 0.6 Duopoly in dialysis care 0.34 0.39 0.42 0.46 0.50 0.4 0.2 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Structural growth from Asia, hospital privatisation and changing demographics EPS Growth 5.0 4.08 4.0 Free cash flow yield >10% 3.0 EUR 3.19 1.77 2.65 2.86 2.0 0.94 2.16 1.0 1.37 Net debt to EBITDA 0.0 0.77 1.09 3.9x 2008 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Source: Deutsche Bank, Henderson Global Investors, at 31 October 2011 2.4x 2011e 8HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • European companies have international exposure Revenue of underlying companies by region ...but we are aware it is becoming a crowded trade100% 330 90% 80% 280 70% 54% 47% 60% 230 50% 40% 15% 20% 180 30% 20% 130 29% 31% 10% 0% 80 Europe - International companies European universe Horizon Pan European Europe - Domestic companies Equity Fund 30 Jul-99 Jul-00 Jul-01 Jul-02 Jul-03 Jul-04 Jul-05 Jul-06 Jul-07 Jul-08 Jul-09 Jul-10 Jul-11 Japan Asia and Emerging Markets North America Developed EuropeSource: Henderson Global Investors, SG cross asset research, Source: ASR, DataStream, Henderson Global Investors, at 29 September 2011 at 30 September 2011Note: European universe refers to Morgan Stanley universe, based on 2011 estimated revenue 9HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Stock example – InditexInvestment case Dividend Growth 2.0 Global fashion retailer: 1.60 1.5 Zara 1.05 1.05 1.20 EUR 0.84 1.0 Massimo Dutti 0.67 0.35 0.48 0.5 Bershka 0.01 0.11 0.14 0.0 Oysho 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Pull and Bear EPS Growth 30% exposure to emerging markets 3.0 2.78 2.5 2.01 2.02 2.11 2.0 EUR 1.61 Strong balance sheet, €3bn net cash 1.5 0.75 1.03 1.29 1.0 0.74 0.5 0.43 0.58 0.0 Recent launch of Zara online 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Source: Deutsche Bank, Henderson Global Investors, at 31 October 2011 10HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Portfolio DNA Stock classification Portfolio (%) Consensus data Portfolio Benchmark Cyclicals* 37.0 1 year forward P/E 12.0 10.3 Quality growth 51.0 Yield 3.9 4.6 Historic 5 year earnings Financials 12.0 1.5 -1.3 growth Forecast earnings growth 11.3 8.6 Forecast dividend growth 14.8 6.3 Return on equity 16.5 14.5 Net Debt to EBITDA** 1.1x 1.3x Source: UBS, Henderson, at 31 October 2011 * Includes 9.0% Oil and Gas ** Excludes financials 11HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Current positioning Reduced cyclical exposure within the Sector weights relative to benchmark Industrials sector Industrials Underweight Pharmaceuticals but IT overweight medical services Healthcare Consumer Disc. Highly selective consumer Energy exposures Telecoms Significantly underweight banks but Consumer Stap. have moved to overweight in Utilities Insurance Materials Financials Prefer Telecoms to Utilities, where Cash we are seeing consolidation and % -10 -5 0 5 10 pricing power Source: Henderson Global Investors, at 1 November 2011 12HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Relative sub-sector exposure (%) Financials sub-sector weights Industrials sub-sector weights relative to benchmark relative to benchmark Air Freight, Marine & Insurance Logistics Business Services Diversified Electrical Financial Equipment Services Industrial Conglomerates Banks Other Industrials % -10 -5 0 5 10 % -5 -3 -1 1 3 5Source: Henderson Global Investors, at 1 November 2011 13HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Market outlookRisks Lack of growth, sovereign default contagion, bank recapitalisation and regulation Deleveraging of governments and economies ongoingReasons for optimism Company management – saying and doing the right things Equities underpinned by strong cash-flow, M&A and appealing valuations Progressing toward sovereign crisis resolution In a low growth world quality companies can still prosperFocus on quality, consistent, reliable companies 14HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Market outlook (cont’d)Source: The Economist 15HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Appendix 16HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Henderson Pan European Equity Team John Bennett (2010; 24 years)* Tim Stevenson Asim Rahman Léopold Arminjon (1986; 28 years) (2010; 11 years)* (2007; 15 years)* Bill Stormont Nick Sheridan Paul Casson (2007; 11 years) (2009; 21 years) (2005; 14 years) Richard Brown CFA*** Eleanor Cameron** (2007; 2 years) (2010; 23 years)* Key Head of team Runs long-only Runs long/short Runs long-only and long/shortSource: Henderson Global Investors, at 30 September 2011Note: Values in brackets show year of joining Henderson and number of years of investment experience * Year joined Gartmore ** Dealing and Operations ***Investment Specialist 17HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Why are we still underweight banks? Bank offer rates Societe Generale share price 100 € 45 Euribor OIS 40 90 LIBOR OIS 35 80 30 25 70 20 15 60 10 31 May 11 24 Jun 11 18 Jul 11 11 Aug 11 04 Sep 11 28 Sep 11 50 40 Japanese banks 30 1600 1400 20 1200 10 1000 800 0 600 400 Jan-10 Jan-11 % Sep-09 May-10 Sep-10 May-11 Sep-11 200 0 1986 1991 1996 2001 2006 2011Source: Henderson Global Investors, Bloomberg, at 30 September 2011September’s Soc Gen moves, -22%, +9%, -26%,+11%, -15%, +25%, -12%, +23% 18HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Company managementDoing and saying the right things “In summary were very pleased with our momentum and the consistent performance in the first half.... our focus remains on investing for growth and executing on our key strategies while, of course, being fully prepared to respond appropriately, as we did three years ago, should we see any significant change in luxury demand.” Stacey Cartwright, Burberry CFO “SAP’s pipeline remains very strong and companies continue to invest in information technology, in particular in innovative software solutions... ongoing uncertain macroeconomic environment prevented us from raising targets.” SAP “This purchase will allow the company to obtain leading positions on skin and hair care markets and enter a new niche – mouth care products,” Paul Polman, Unilever CEO on the purchase of Kalina 19HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Top 10 holdings Name Country Portfolio weight (%) EPS growth 1-year forward (%) Dividend yield (%) Deutsche Post Germany 3.8 8.7 6.4 Fresenius Se Germany 3.6 13.2 1.4 Amadeus IT Spain 3.4 14.0 3.2 Fresenius Medical Care Germany 3.3 13.9 1.4 Royal Dutch Shell UK 3.2 9.7 4.8 SAP Germany 3.1 13.4 1.8 Vodafone Group UK 3.0 2.7 8.0 Roche Holding Switzerland 3.0 8.8 5.5 BP UK 3.0 0.4 3.9 Sodexo France 2.9 14.3 3.5Source: Factset, UBS, IBES, Henderson Global Investors, at 31 October 2011 20HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Equity market supports – growth themes Infrastructure (Schneider) Restructuring/operational improvements (Deutsche Post) Outsourcing non-core activities (Capita) Technology (SAP) Demographics (Fresenius) 21HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Biographies Tim Stevenson William Stormont Director, European Specialist Equities Fund Manager, Pan European Equities Career: Career: 1991 Director, European Equities 2007 Henderson Global Investors Fund Manager, Pan European Equities 1986 Henderson Global Investors 2005 Hedge Fund Sales, European Equities Fund Manager, Europe, with responsibility for overseas clients 2004 Head of International Hedge Fund Sales 1984 Aetna Montagu Asset Management Limited Responsible for European Investments for ERISA clients and 2002 Hedge Fund Sales, European Small/Large Cap MIM Pension Funds 2000 ABN AMRO, Equities European Smaller Companies Strategist 1983 Savory Milln European Analyst 1995 University of Durham, Boundary and Security Bulletin (1995 – 1998) Education: Christian Albrechts Universitat zu Kiel Regional Editor 1995 International Affairs Consultant (1995 – 1999) Sussex University, BA (Hons) Economics and European Studies 1993 South Sea China Project (1993 – 1998) Senior Policy Analyst Education: University of British Columbia MBA Strategic Management BA International Relations 22HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt
    • Henderson Global Investors 201 Bishopsgate, London EC2M 3AE Tel: 020 7818 1818 Fax: 020 7818 1819Important InformationThis document is solely for the use of professionals and is not for general public distribution.The Henderson Horizon Fund (the “Fund”) is a Luxembourg SICAV incorporated on 30 May 1985. This document is intended solely for the use ofprofessionals and is not for general public distribution. Any investment application will be made solely on the basis of the information contained in theFund’s full prospectus (including all relevant covering documents), which will contain investment restrictions. This document is intended as a summaryonly and potential investors must read the Fund’s full prospectus before investing. A copy of the Fund’s full and simplified prospectuses can be obtainedfrom Henderson Global Investors Limited in its capacity as Investment Manager and Distributor.Issued in the UK by Henderson Global Investors. Henderson Global Investors is the name under which Henderson Global Investors Limited (reg. no.906355) (incorporated and registered in England and Wales with registered office at 201 Bishopsgate, London EC2M 3AE and authorised and regulatedby the Financial Services Authority) provide investment products and services. Telephone calls may be recorded and monitored.Past performance is not a guide to future performance. The performance data does not take into account the commissions and costs incurred on the issueand redemption of units. The value of an investment and the income from it can fall as well as rise and you may not get back the amount originallyinvested. Tax assumptions and reliefs depend upon an investor’s particular circumstances and may change if those circumstances or the law change. Ifyou invest through a third party provider you are advised to consult them directly as charges, performance and terms and conditions may differ materially.The securities included in this document are not registered in the Foreign Securities Registry of the Superintendencia de Valores y Seguros for publicoffering and, therefore, the use of this document is only for general information purposes.Nothing in this document is intended to or should be construed as advice. This document is not a recommendation to sell or purchase any investment. Itdoes not form part of any contract for the sale or purchase of any investment.The Fund is a recognised collective investment scheme for the purpose of promotion into the United Kingdom. Potential investors in the United Kingdomare advised that all, or most, of the protections afforded by the United Kingdom regulatory system will not apply to an investment in the Fund and thatcompensation will not be available under the United Kingdom Financial Services Compensation Scheme.A copy of the Fund’s full and simplified prospectuses, articles of incorporation, annual and semi-annual reports can be obtained free of cost from theFund’s: Austrian Paying Agent Raiffeisen Zentralbank Österreich AG, Am Stadtpark 9, A-1030 Vienna; French Paying Agent BNP Paribas SecuritiesServices, 3, rue d’Antin, F-75002 Paris; German Information Agent Marcard, Stein & Co, Ballindamm 36, 20095 Hamburg; Belgian Financial ServiceProvider Dresdner Van Moer Courtens S.A./N.V. Société de bourse, Drève du Prieuré 19, 1160 Bruxelles; Spanish Representative Allfunds Bank S.A.Estafeta, 6 Complejo Plaza de la Fuente, La Moraleja, Alcobendas 28109 Madrid; or Swiss Representative BNP Paribas Securities Services, Paris,succursale de Zurich, Selnaustrasse 16, 8002 Zurich who are also the Swiss Paying Agent. 23HDS.IntDataCSUK2011!PG11TPS Citywire November.ppt