ANNUAL REPORT 2004/05 9 SEPTEMBER 2005

234 views

Published on

0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
234
On SlideShare
0
From Embeds
0
Number of Embeds
1
Actions
Shares
0
Downloads
2
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide
  • N
  • ANNUAL REPORT 2004/05 9 SEPTEMBER 2005

    1. 1. ANNUAL REPORT 2004/05 9 SEPTEMBER 2005 Presentation to Portfolio Committee on Finance
    2. 2. Contents <ul><li>Highlights of the year: 2004/05 </li></ul><ul><li>Progress on Corporatisation </li></ul><ul><li>Addressing Concerns Raised by AG in Past Financial Years </li></ul><ul><li>Total assets under management </li></ul><ul><li>PIC Clients </li></ul><ul><li>Performance </li></ul>
    3. 3. Highlights of the year: 2004/05 <ul><ul><li>Positioning the Corporation to become a modern asset management Company </li></ul></ul><ul><ul><li>Growth of assets under management from R377 billion to R461 billion </li></ul></ul><ul><ul><li>Upgrading of IT infrastructure </li></ul></ul><ul><ul><li>Increased pace in BEE funding </li></ul></ul><ul><ul><li>Upgrading of retail properties at a cost of R157 million </li></ul></ul><ul><ul><li>Increased impetus on shareholder activism </li></ul></ul>
    4. 4. Progress on Corporatisation <ul><ul><li>Corporation launched on 1 April 2005 </li></ul></ul><ul><ul><li>Memorandum and Articles of Association signed by shareholder </li></ul></ul><ul><ul><li>Registered in terms of Companies Act </li></ul></ul><ul><ul><li>Completing registration as a Financial Service Provider in terms of FAIS Act </li></ul></ul><ul><ul><li>Interim Board appointed </li></ul></ul><ul><ul><li>All former National Treasury employees transferred to the Corporation </li></ul></ul>
    5. 5. Addressing Concerns Raised By The AG In Past Financial Statements <ul><li>All issues have been addressed. Frequent monitoring by Internal Audit Division </li></ul><ul><li>Non-compliance with PFMA </li></ul><ul><li>Internal Audit Manager appointed and Internal Audit section established </li></ul><ul><li>No Internal Audit function </li></ul><ul><li>Compliance Officer has been appointed </li></ul><ul><li>No Compliance function </li></ul><ul><li>Systems put in place to ensure GAAP compliance as well as AC133 and AC 135 compliance </li></ul><ul><li>Non-compliance with GAAP and valuation of properties i.t.o. AC 135 not performed </li></ul>Remedial Steps taken Emphasis of Matter
    6. 6. Addressing Concerns Raised By The AG In Past Financial Statements <ul><li>All the matters have been resolved </li></ul><ul><li>Issues relating to ownership of properties </li></ul><ul><li>Framework has been developed </li></ul><ul><li>Continuous monitoring. </li></ul><ul><li>Risk Management Framework had not been implemented </li></ul>Remedial Steps Taken Emphasis of matter
    7. 7. Total PIC Assets Under Management 488.05 459.7 377.5 Grand Total 3.73 3.6 3.2 PROPERTIES 1.30 1.3 12.7 SIPS 12.52 16.4 6.0 ISIBAYA 43.94 45.1 31.1 CASH 192.33 175.4 130.5 EQUITIES 234.22 217.8 194.0 BONDS 30/06/2005 31/03/2005 31/03/2004 ASSET CLASS EXPOSURE R billion
    8. 8. Total PIC Assets Under Management (Weights) 100.00% 100.00% 100.00% Grand Total 0.00% 0.00% 0.00% OPTIONS 0.27% 0.28% 3.43% SIPS 0.76% 0.79% 0.85% PROPERTIES 2.57% 3.57% 1.57% ISIBAYA 9.00% 9.81% 8.30% CASH 39.41% 38.15% 34.48% EQUITIES 47.99% 47.39% 51.37% BONDS 30/06/2005 31/03/2005 31/03/2004 ASSET CLASS
    9. 9. PIC Clients: Top 10 Funds 99.85 487.4 458.9 376.9   TOTAL 0.06% 0.29 0.3 0.5 Temporary Employees Pension Fund 10 0.10% 0.50 0.6 0.6 Period Loans: University Redemption Funds 9 0.15% 0.75 0.9 0.9 RDP Funds 8 0.25% 1.22 1.2 1.2 Department of Labour: NSF- Levies 7 0.62% 3.01 2.8 2.4 Guardian Funds 6 1.17% 5.72 5.5 4.5 Compensation Commissioner : Compensation Fund 5 1.41% 6.89 6.7 5.9 Compensation Commissioner : Pension Fund 4 2.30% 11.24 9.9 6.3 Unemployment Insurance Fund 3 2.23% 10.89 10.7 10.0 Associated Institution Pension Fund 2 91.56% 446.89 420.3 344.7 GEPF (Government Employees Pension Fund) 1 %AUM 30/06/05 31/03/05 31/03/04 PORTFOLIO NAME
    10. 10. Consolidated Fund Performance 4.0 5.2% 20.6% Total Fund 2.0 5.6% 10.7% Structured Investment Products 64.3 0.1% 7.8% Money Markets 1.6 10.1% 15.7% Properties 3.0 11.5% 33.9% Equities 4.9 2.9% 14.1% Capital Market Risk/Return Ratio Risk Return
    11. 11. GEPF Performance 3.4 6.3% 21.6% Total Fund 2.0 5.3% 10.7% Structured Investment Products 25.8 0.3% 7.7% Money Markets 1.5 10.1% 15.7% Properties 3.0 11.5% 33.9% Equities 3.1 4.5% 14.1% Capital Market Risk/Return Ratio Risk Return
    12. 12. GEPF Cumulative Returns: Total Fund & Asset Classes
    13. 13. Equities Returns vs. Benchmark TE: 1.02% 12.21% 11.98% Total Risk 1.85% 32.03% 33.87% Returns Excess Returns Benchmark Returns GEPF Equities 01/04/04 – 31/03/05 12 Months
    14. 14. Bonds vs. Benchmark 80% ALBI + 20% Inflation Linked Bonds TE: 0.78% 5.41% 4.75% Volatility 0.12% 14.00% 14.12% Annualised returns Excess Returns Benchmark Returns Capital Market 12 Months 01/04/04 - 31/03/05 TE: 0.70% 4.43% 4.13% Volatility 0.35% 12.21% 12.55% Annualised returns Excess Returns Benchmark Returns Capital Market 24 Months 01/04/03 - 31/03/05
    15. 15. Money Markets vs Benchmark Benchmark Is the Alexander Forbes STEFI 3 Months, 6 Months and 12 Months. 15% 20% 65% PIC BMK 9-12 Months 3-9 Months 0-3 Months TE: 0.35% 0.11% 0.31% Total Risk 0.16% 7.59% 7.75% Returns Excess Returns Benchmark Returns Cash & Money 01/04/04 – 31/03/05 12 Months TE: 2.06% 0.63% 2.05% Total Risk 0.60% 9.13% 9.73% Returns Excess Returns Benchmark Returns Cash & Money 01/04/03 – 31/03/05 24 Months This reflects the average PIC exposures over time.
    16. 16. Property Investments Returns Performance (%) R’Million 21.60 3,285.8 TOTAL 61.52 412.0 Listed Property Investments 18.87 1,831.9 Pareto (40%) 10.62 1,041.9 Direct Property Investments Current Holdings
    17. 17. Isibaya Fund Investments
    18. 18. Isibaya Fund Performance 23.13% Volatility 40.89% Return
    19. 19. Structured Investment Products SIPS have outperformed Cash albeit at higher risk, and CPI + 6%   5.57% Volatility 9.00% 10.70% TOTAL Performance Period:01/04/04 - 31/03/05 (Unaudited)   5.66% Volatility 6.41% 6.94% TOTAL Performance Period:01/04/03 - 31/03/04   5.51% Volatility 15.99% 18.38% TOTAL CPI + 6% SIPS   Performance Period : 01/04/03 - 31/03/05
    20. 20. WAY FORWARD <ul><ul><li>Client Focus </li></ul></ul><ul><ul><ul><li>Continue provide exceptional service to our clients </li></ul></ul></ul><ul><ul><li>Consolidation of the Corporatisation process </li></ul></ul><ul><ul><ul><li>Refinement of investment processes </li></ul></ul></ul><ul><ul><ul><li>Continue recruitment of suitably qualified and skilled staff </li></ul></ul></ul><ul><ul><ul><li>Refinement of IT systems </li></ul></ul></ul><ul><ul><li>Champion transformation in the asset management industry </li></ul></ul><ul><ul><ul><li>Champion SRI, sound corporate governance, charters and applicable Nedlac agreements, </li></ul></ul></ul><ul><ul><li>Positioning of PIC in asset management industry </li></ul></ul><ul><ul><ul><li>Consolidate the establishment of the PIC’s as the leading asset management company in SA </li></ul></ul></ul>
    21. 21. THANK YOU

    ×