MUTUAL FUNDS (ICICI Prudential Mutual Fund) BY JAMES RODRIGUESWilliamRodrigues148
Mutual funds are investment vehicles that pool money from multiple investors to purchase a diversified portfolio of stocks, bonds, or other securities. They are managed by professional portfolio managers or investment companies who make investment decisions on behalf of the fund's investors.
2. Earnings Release – April 22, 2009 2
Agenda
• First Quarter Results
• Segment Results
• Spotlight – Epsilon Marketing Services
Bryan Kennedy, President of Epsilon
• Second Quarter and Full-Year Outlook
4. Earnings Release – April 22, 2009 4
Loyalty Services Canada (constant currency)
• Strongest 1st Quarter in its History
• Revenues Grew 17%, Adjusted EBITDA Grew > 50%
• Renewed Shell-Canada (Top 10 ADS; Top 5 Loyalty) and Goodyear-Canada
• Miles Redeemed Grew 12%
• Recession not changing behavior
• Miles Issued Weak (-4%)
• Weak quarters not unprecedented (2001, 2002, 2008)
• Expect strong snapback by summer
• New value-enhanced launches by sponsors
• Gas price driven volume anniversaries Q3
• Home improvement category driven by tax changes
• Outlook: Strong Results to Continue (FX anniversaries Q4)
5. Earnings Release – April 22, 2009 5
Epsilon Marketing Services
• Q1 Relatively Flat Against Toughest 2008 Comp
• 60% of Segment (Database, Analytics, Digital) Double-digit Growth
• Dynamic & Perpetual Data Driven Services
• $700B Shift to Accountable Marketing Programs
• Shift to Email Marketing Solutions
• 40% of Segment (Data, Agency) Negative, but Ramping
• New Wins at Record Pace:
• 5 Database/Analytics
• 15 Digital
• Q2: • Database, Analytics, Digital: Growth to Continue
• Data, Agency: Returning to Growth
• Full-Year Outlook: Tracking to 7% Top/Bottom Performance
6. Earnings Release – April 22, 2009 6
Epsilon Marketing Services
• Strength of Epsilon’s Business Model
• Demand for measurable, “accountable” marketing increases in a downturn
• 3 Critical Ingredients:
DATA – identify and understand customer behavior
+
STRATEGY – agency capabilities to design, analyze, measure &
execute programs across channels
+
TECHNOLOGY – best-in-class assets & services to manage customer
marketing programs and platforms
↓
= FULL SERVICE EXECUTION, FULLY INTEGRATED DELIVERY
7. Earnings Release – April 22, 2009 7
Private Label: Services and Credit
• Services (Network, Customer Care, Marketing): Both Revenue and Adjusted EBITDA Up
• Credit: Revenue and Adjusted EBITDA Down
• Combined: Adjusted EBITDA ↓ 20% ($25MM)
↑ 10% (v. 0% 2008)
(+) Portfolio
↑ 3% (v. -3% 2008)
Credit Sales
Funding Costs Better
Yields Stable
Pipeline Strong/ Wins Included HSN, Haband, Springstone, and PacSun – (Renewal)
↑ 180 bps (8.8% v. 7% 2008)
(–) Credit Losses
I/O Growover $0 v. + $10MM 2008
8. Earnings Release – April 22, 2009 8
Private Label: Services & Credit
• Outlook – Credit Losses
2007 2008 2009e
• Avg. Unemployment Rate 4.7% 6.1% *8.5%
} 110bps } 120bps } 100bps
• Total Credit Losses 5.8% 7.3% 9.5%
*(assumed unemployment trend 7.6% Jan; 9.5% Dec)
• Outlook –
• Q1 losses 8.8%
• Q2 seasonality – losses ↑ 70bps v. Q1, then settle down
• Funding saves to mitigate rise in losses
• Credit Loss drag begins to narrow in back half of year
• Full-year I/O growover drag ($30MM) to anniversary end Q4
↓
• Summary: Front-half 2009 tough, back-half 2009 improving, 2010 Solid
9. Earnings Release – April 22, 2009 9
Balance Sheet
($MM) As of March 31, 2009
Cash and Cash Equivalents $322
Redemption Settlement Assets (Trust Cash) 514
Total Assets $4,500
Deferred Revenue $946
CD’s 933
Core Debt 1,631
Total Liabilities $4,086
Stockholders’ Equity $414
Key Metric:
• Net Core Debt / LTM Op. EBITDA (Op. Cash Flow) approx. 2.0x
10. Earnings Release – April 22, 2009 10
Guidance
Q2: Sequential Comparison to Q1 2009
• Private Label’s Weakest Quarter
• 80% of Q1 → (18¢) Seasonality – lower finance income and higher credit losses
• Lack of FX Benefit on Investments (4¢)
• Positives: Epsilon, Buyback
↓
Q1: Actual $1.19
•
Q2: Private Label Seasonality ($.18)
•
Q2: No FX Benefit on Investments (0.04)
•
Q2: Epsilon, Buyback 0.08
•
• Q2 Outlook $1.05 (constant currency $1.18)
Full-Year Outlook
• Maintain Cash EPS of at Least $5.15, ↑17%
• FX Hit of ($140MM) Revenues & ($40MM) Adjusted EBITDA
• ($40MM) Revenues & ($15MM) Adjusted EBITDA Worse than Plan
• Credit Losses ($30MM) Revenues & ($30MM) Adjusted EBITDA Worse than Plan
• 9.5% Loss Rate ↑ 70bps v. Plan
• Funding Costs $30MM Revenues and $30MM Adjusted EBITDA Better than Plan