HANSA TRUST PLC AGM
July 2018 HANSA TRUST NAV and Share Price Performance as at 25 July 2018
25 July 2018 25 July 2017
NAV (£) 351,019,356 320,527,025
NAV per share (p) 1,462.6 1,335.5
Ordinary Share Price (p) 1,095.0 944.3
‘A’ Ordinary Share Price (p) 1,015.0 910.0
Ordinary Share Price Discount (25.1%) (29.3%)
‘A’ Ordinary Share Price Discount (30.6%) (31.9%)
Performance (%) Financial YTD 1 Year 3 Years 5 Years
NAV 8.7 9.5 24.9 40.5
NAV Total Return 9.3 10.8 29.8 50.0
Ordinary Share Price 10.3 16.0 25.0 41.8
Total Return on Ordinary Shares 11.2 17.8 32.2 55.3
‘A’ Ordinary Share Price 3.8 11.5 20.8 33.8
Total Return on ‘A’ Ordinary Shares 4.7 13.3 27.8 46.7
2 HANSA TRUST Directors’ Holdings and Applied Discount as at 25 July 2018
Director Ordinary Shares ‘A’ Ordinary Value of holding Value of holding Discount Shares at share price at NAV William Salomon 2,115,869 98,700 £24,170,571 £32,389,858 £8,219,287
Jonathan Davie 4,000 26,000 £307,700 £438,774 £131,074
Alex Hammond-Chambers 4,900 10,600 £161,245 £226,700 £65,455
Lord Oxford 1,850 1,850 £39,035 £54,115 £15,080
Geoffrey Wood 1,000 2,000 £31,250 £43,877 £12,627
TOTAL 2,127,619 139,150 £24,709,801 £33,153,325 £8,443,524
3 HANSA TRUST PLC AGM
Rob Murphy The Edison Group The Edison Group Edison Investment Research Edison Advisors An Overview of Edison Introduction to Edison Group 1 People Edison at a glance 110+ Analysts & support “An investment research and advisory company” 80+ Two operating brands: Reports published last year Edison Investment Research Edison Advisors 2,500+ Established 2003 Investor meetings (per annum) Regulated across all key territories
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Global Unrestricted Distribution & Discovery Edison TV
Conferences Edison Research 5
Hansa research note distribution
• Direct email to thousands of fund managers, institutional investors, IFAs, private client brokers and retail investors
• Professional platforms including Bloomberg, Thomson Reuters, Factset, BlueMatrix, RedDeer, Research Tree
• Dedicated platforms: Interactive Investor (£21bn AUM) Alliance Trust Savings (£16bn AUM) The Share Centre (£21bn AUM) FundSource, Good Returns (NZ)
• Hargreaves Lansdown (£89bn AUM) and multiple sites via RNS
• An announcement on social media accounts (including Twitter, LinkedIn, GooglePlus), notifying relevant investors and journalists Investor Relations Investor Outreach 6
Strategic Investor Relations Programme: Hansa Trust
Strategy goals Programme details Build understanding of the Research reports with global open-access distribution investment case Investor perception / market pulse studies Build shareholder register Highly targeted professional investor meetings Improve stock liquidity Research readership – InvestorTrack Emphasis on quality investors Shareholder register analysis – Hansa & peer trusts Full spectrum of investors Proprietary investor relationships Narrow discount Meeting feedback Edison TV Media engagement Retail investor events Investor Relations Investor Outreach 7
Highlights: Regional wealth manager meetings June 2017
• A number of investors were familiar with Hansa Trust, but had not met with the Company in some time. • Edison facilitated a first ‘reconnect’ meeting • many investors were keen to schedule further follow-up meetings
• The wide discount and portfolio repositioning makes Hansa potentially attractive
• All investors were supportive of Alec and his strategy on shaping the portfolio: ‘Alec is a safe pair of hands’
• The main barriers to the investment case: • Ocean Wilson’s stake – investors were keen to learn more about the macro backdrop in Brazil and the Ocean Wilson’s stake • Liquidity in the Company’s shares Investor Relations Investor Outreach 8
Highlights: Subsequent key themes from meetings
• Investment strategy ‘The recent changes made between 2014-2017 are encouraging and I like how Alec has blended the portfolio selling down stakes in UK equities’ ‘The NAV is likely to grow rather than shrink from these levels’
• Transparency ‘It’s a complex investment. Alec presented very well and everything became very clear as the meeting progressed’ ‘Alec was brilliant, he was straight forward, pragmatic and so transparent. Other managers should be as willing as he is to disclose and discuss their portfolios’
• The value case ‘We were attracted to the prospect of having a discounted idea we could invest in’ ‘There’s a reasonable dividend, it trades at a good discount and fees are fine’ ‘Hansa Trust ticks a lot of boxes for us; no gearing, UK domiciled, nice dividend yield and the discount is very attractive ‘We are investment trust specialists and like the value opportunity of the Trust’ Investor Relations Investor Outreach 9
Liquidity: improving
Hansa Trust Year Jan-Jul Jan-Jul Avg Daily Volume (# shares) 2017 2017 2018 A non-voting 14,711 14,027 17,871 Ordinary voting 4,913 5,999 4,408 Total 19,624 20,026 22,279 Source: Bloomberg Investor Relations Investor Outreach 10
Discount: progress
Hansa Trust Plc
-20
-22
-24
-26
-28 NAVPremium (Discount) / % -30
-32
-34
-36
-38 03/01/2017 03/03/2017 03/05/2017 03/07/2017 03/09/2017 03/11/2017 03/01/2018 03/03/2018 03/05/2018 03/07/2018
Ordinary voting A non-voting Weighted Investor Relations Investor Outreach 11
Discount: recent widening on strong NAV growth
Hansa Trust Plc
-20 15
-22 14.5
-24 14
-26 13.5
-28 13 Weighted Premium Weighted
-30 12.5 £ per share NAV
-32 12
-34 11.5
-36 11 03/01/2017 03/03/2017 03/05/2017 03/07/2017 03/09/2017 03/11/2017 03/01/2018 03/03/2018 03/05/2018 03/07/2018
Weighted premium NAV per share Contact Us
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www.edisongroup.com HANSA TRUST PLC AGM
William Salomon Thoughts on Brazil HANSA TRUST PLC AGM
Alec Letchfield Portfolio Manager Report - July 2018 HANSA TRUST Recap………our aims and aspirations for Hansa Trust
• A proprietor-led vehicle with strong alignment (rather than an asset gathering entity)
• A multi-asset fund that offers something different from most other portfolios in the market place
• A fund aspiring to generate long-term returns and not short-term focused – a natural bias towards equities
• Dynamically managed asset allocation
• A focus on real risk rather than relative returns
• A fund providing access to best-in-class managers not normally available to the man on the street and direct equity investments
20 HANSA TRUST Recap…………Strategic review
31 December 2013 30 June 2018
OWIL OWIL 11.7% 11.0% Core Regional Wilson Sons Wilson Sons Funds 23.3% 17.3% 35.2% UK Equity 65.0% Diversifying & Cash 13.5% Thematic Global Equities 6.0% 17.0%
21 Performance Review
22 HANSA TRUST Performance to end June 2018
Financial Year Calendar YTD 18 Months 5 years (p.a.) 15 years (p.a.) 2017/18 NAV Performance TR 1.9% 6.3% 13.3% 7.9% 11.5% NAV Performance ex. OWHL TR 5.9% 6.5% 19.9% 9.7% 9.4% Ordinary Share TR 3.1% 16.5% 31.7% 8.5% 11.6% ‘A’ Ordinary Share TR 0.8% 17.3% 22.1% 7.0% 11.1% KPIs FTSE All-Stocks Gilts TR 0.4% 0.5% 2.3% 5.0% 5.2% UK CPI 0.9% 2.4% 3.8% 1.5% 2.3% MSCI All Country World Index NR GBP 2.3% 2.2% 15.6% 12.8% 9.9% FTSE All Share TR 1.7% 1.2% 15.0% 8.8% 8.9%
450%
400%
350%
300%
250%
200%
150%
100%
50%
0% Jun-03 Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-10 Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 Jun-17 Jun-18
NAV Cum Income TR Ord Share TR A Ord Share TR
Source: Hansa Trust internal (unaudited), Bloomberg, FTSE
23 HANSA TRUST Performance post strategy change (end March 2014 to end June 2018)
100.0%
90.0%
80.0%
70.0%
60.0%
50.0%
40.0%
30.0%
20.0%
10.0%
0.0% Core Regional Funds Thematic Global Equities Diversifying Strategic (Ocean Wilsons Cash / FX Exposure Holdings Limited)
24 £10,000,000 £20,000,000 £30,000,000 £40,000,000 £50,000,000 £60,000,000 £70,000,000 £80,000,000 £90,000,000 Performance HANSA TRUST £-
Findlay Park American 6,212,577 Select Equity Offshore 5,862,726 Vulcan Value Equity 5,458,469 Goodhart: Hanjo 4,146,771 SISF Asian Total Return 4,013,853 Core Regional Core BlackRock Eur Hedge 2,732,312
Adelphi Eur Select Equity 2,447,859 contribution Indus Japan Long Only 2,257,345 Prince Street Inst 1,306,458 NTAsian Discovery 739,448 Funds Vanguard Dev Eur ex UK 670,994 iShares Euro Stoxx 423,261 BlackRock Frontiers 167,985 Odey Absolute Return 150,694 SR Global Frontiers 47,796 Egerton Long - Short 6,317 strategysince Marchto(end 2014 change Pershing Square 1,917,712 Thematic GAM Star Tech 7,997,346 SPDR MSCI World Fins 183,549 Worldwide Healthcare 110,834 UBM 5,100,536 Hansteen Holdings 4,057,639 Hilton Food 1,975,015 Interactive Brokers 1,578,548 Orion Engineered Carbons 629,188 Alphabet 607,437 Iridium 566,173 CBRE 442,593
Tripadvisor 423,843 Equities Global Subsea 7 292,881 Coca-Cola Bottlers Japan 262,765 Nutrien 249,673 Exor 191,295 Berkshire Hathaway 160,820 Orange 156,222 White Mountains 121,349 Howard Hughes Corp 81,898 Samsung 17,254 Bayer AG 102,809 Technicolor 326,619 CK Hutchison 365,377 CVS Health 402,618 Liberty Global 616,975
Global Event Partners Ltd 1,030,514 Alternatives Diversifying end June 2018)end Hudson Bay 640,417 Field Street Offshore 374,793 Keynes Dynamic B Strategy 192,031
CZ Abs Alpha UCITS 77,050 - MKP Opp Offshore 46,459 Fixed Income Diversifying GAM Core Macro 6,977 Schroder GAIA BlueTrend 234,632 Ocean Wilsons Holdings Wilsons Ocean JLP Credit Opp 153,961 Gladwyne USD 25,689 BNY Abs Return Bond Fund 15,123 –
25 Ocean Wilsons Holdings 12,684,385 Equity Private DV4 Ltd 2,293,602 Cash/FX 1,040,854 Holdings sold during period 2,583,506 Total 78,985,589 Market Outlook & Portfolio Positioning
26 HANSA TRUST Argentine currency Key Events – World markets since January 2017 Increased crisis inflation & interest rates Trump expectations 1700 threatens to US tax withdraw from reform bill 1650 NAFTA
1600 Korean 1550 nuclear crisis French 1500 election
1450 US steel tariff exemptions Peak US/China 1400 trade war expire
MSCIFM ACWIIndex Bitcoin price 1350 Hurricanes Harvey, UK 1300 Irma, Jose election & Maria 1250
1200 July 17 July May 18 May May 17 May June 18 June June 17 June April 18 April April 17 April March 18 March 17 August 17 August January 18 January January 17 January October 17 February 18 February February 17 February December 17 December November 17 November
September 17 September Source: Bloomberg
27 HANSA TRUST Market outlook: Risks are rising….economies
Source: Deutsche Bank
As we near peak employment, wage Is 2018 the year of peak growth? inflation finally appears to be picking up
28 HANSA TRUST Market outlook: Risks are rising….geo-political
Source: Deutsche Bank Are we on the brink of a Populism on the rise throughout the world global trade war? (in 2000, an average 8.5% of the vote went to populist arties. In 2017 that number was 24.1%)
29 HANSA TRUST Market outlook … but still more to go for
Source: Goldman Sachs
No sign of recession yet Valuations are not at peak levels
30 HANSA TRUST Market outlook … but still more to go for
Some signs of exuberance Other asset classes remain expensive – but not what you normally what else do you do with your money? get at the peak of cycles
31 HANSA TRUST Current Portfolio Positioning (as at 30 June 2018)
20%
18% 17.0% 17.3%
16% 13.9% 14%
12% 11.0%
10%
8% 7.1% 6.9% 6.4% 6% 4.6% 3.5% 4% 3.1% 2.0% 1.5% 1.8% 2% 1.2% 1.0% 1.4% 0.5% 0% Cash Japan Europe Property Financials Technology Health Care Wilson Sons Wilson Hedge Funds Hedge Fixed Income Fixed North America North Global Equities Global Frontier Markets Global Developed Global Asia Pacific ex Japan Pacific Asia Global Emerging Markets Ocean Wilsons (Investments) Limited (Investments) Wilsons Ocean Core Regional Funds Thematic Equities Diversifying Strategic
Source: Hansa Trust internal, unaudited
32 HANSA TRUST Japan Market outlook.….core positions
Technology
Emerging & Frontier markets
Healthcare Asia
33 HANSA TRUST Conclusion
• Stock markets are arguably looking long in the tooth
• Despite this, the features one would normally expect to see at a market peak are not yet in place – for this reason we still see more upside in equities
• We would expect more volatility from here - last year’s low volatility was an anomaly – and we are getting prepared to add to more defensive positions as the cycle evolves
• Japan, emerging, Asian and frontier markets preferred geographies. Technology and healthcare remain attractive longer term themes
34 Appendix
35 HANSA TRUST Portfolio Characteristics (as at 30 June 2018) Look-through analysis of Hansa Trust portfolio, including holdings in Ocean Wilson (Investments) Ltd * Geographic Exposure Sector Exposure 0.7% 3.8% 1.4% 8.1% 2.0% 1.4% 3.8% 2.8% 0.5% 3.9% 8.8% 32.2% 6.3% 22.7% 8.9% 8.1% 16.9% 8.9% 8.6% 10.6% 18.4% 8.8% 12.4%
Industrials Information Technology Financials North America Latin America Developed Europe ex UK Diversifying Hedge Funds Consumer Staples Consumer Discretionary UK Asia Pacific ex Japan Diversifying Hedge Funds Health Care Materials Real Estate Japan Middle East & Africa Cash/Liquidity Funds Telecommunications Energy Cash/Liquidity Funds Emerging Europe Utilities Asset Type 2.9% Dealing Frequency 3.5% 1.8% 1.4% 3.6% 3.5% 0.2% 6.9% 8.1% 38.3% 12.7% 17.0% 43.6%
28.3% 28.3%
Daily Ocean Wilsons Holdings Ltd Long Only Ocean Wilsons Holdings Ltd Direct Equities Monthly Quarterly Market Neutral Private Equity Long-Short Weekly Fixed Life Investment Period Complete Fixed Income Cash > 1 year
* Geographic and sector exposures based on top 30 holdings as announced by Ocean Wilsons Holdings 31 Dec 2017 36 HANSA TRUST Fees
THIRD PARTY Can be higher cost with two PASSIVE layers of fees in a fund Low cost but guaranteed sub structure. However, you can market returns. Also invest in best-in-class structurally biased towards managers globally (unlikely those companies and sectors to be able to do this that are becoming more internally), access all expensive and not managed markets/sectors and sell for market risk those managers which are underperforming HANSA TRUST
The fee debate is nuanced. Clearly you want to keep fees down to reduce friction but going low cost
INTERNAL may work to your detriment in the Lower cost than third party longer term. We have blended managers and provides another source of alpha in a portfolio. elements of all the options in However you are typically Hansa Trust. locked into your internal offering regardless of how good it is!
37 HANSA TRUST Fees
Annual 3rd Party Management Fees on Underlying Holdings (March 2018)
2.9% 4.5%
47.7%
44.9%
0% 0 < x ≤ 1% 1 < x ≤ 1.5% 1.5 < x ≤ 2%
Weighted average management fee = 1.20%. This includes the management fee paid to Hansa Capital Partners LLP as well as management fees paid to third parties for the underlying funds.
38 HANSA TRUST Fees
Third party fees within Hansa Trust Breakdown of total fees and costs 3.0% Internally managed therefore no third party fees 2.5%
2.0%
1.5%
1.0% Fees as % of NAV 0.5% Our management fee is reduced from 1% as it is 0.0% not charged on Ocean Wilsons Holdings
Hansa Trust total = 1.82%
Management Fee 3rd party fees Retail class Other costs
* Schroder Global Diversified Growth: 34.5% is externally / passively managed – not clear if third party fees are included.
Witan, Jupiter, Baring: third party fees are included in other costs. HANSA TRUST Investment process…..Global equity selection
Our global equity portfolio is composed of 20 – 45 names, is diversified, has a high active share and is built from the bottom up
40 IMPORTANT NOTICE
This presentation pack is issued by Hansa Capital Partners LLP, which is authorised and regulated by the Financial Conduct Authority.
Hansa Capital Partners LLP is the Manager and Company Secretary to Hansa Trust PLC.
Investment Trusts are UK Public Listed companies and are not authorised or regulated by the Financial Conduct Authority.
The staff at Hansa Capital Partners LLP and/or the Directors of Hansa Trust PLC may hold positions in the securities mentioned in this presentation or may buy, sell or offer to make a purchase or sale of such securities from time to time.
This presentation pack is not a prospectus, does not contain any representations, and does not constitute or form part of any offer or invitation to buy, underwrite or solicit any offer to purchase securities, nor shall it or any part of it form the basis of or be relied upon in connection with any contract therefore.
This presentation pack has been solely supplied for your information and you may not be reproduce it, distribute it to another person or publish it, in any case in whole and in part, for any purpose. The information contained in this pack is selective, is for background purposes only and is subject to amendment.
Past performance is not necessarily a guide to future performance. The price of shares and income generated may fall as well as rise. An investor may not get back the amount invested.