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Together, we are investing in Australia’s future generation
Investor Presentation November/December 2015
Disclaimer
This presentation has been prepared for use in conjunction with a verbal presentation and should be read in that context. The information in this presentation is only intended for Australian residents. The purpose of this presentation is to provide information only and the contents of the presentation does not purport to provide investment advice. We strongly suggest that investors read the Prospectus and consult a financial adviser prior to making any investment decision. The presentation does not take into account the investment objectives, financial situation or particular needs of any person and should not be used as the basis for making investment, financial or other decisions. The information is selective and may not be complete or accurate for your particular purposes and should not be construed as a recommendation to invest in Future Generation Investment Company Limited. The information provided in the presentation is given in good faith and is believed to be accurate at the time of compilation. Neither Future Generation Investment Company Limited nor its directors or employees make any representation or warranty as to the accuracy, reliability, timeliness or completeness of the information. To the extent permissible by law, Future Generation Investment Company Limited and its directors and employees disclaim all liability (whether arising in contract, tort, negligence or otherwise) for any error, omission, loss or damage (whether direct, indirect, consequential or otherwise). Neither Future Generation Investment Company Limited nor its directors or employees guarantee or make any representation as to the performance of Future Generation Investment Company Limited, the maintenance or repayment of capital, the price at which shares may trade or any particular rate of return.
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Future Generation – our purpose
Future Generation’s listed investment companies are
Australia’s first listed philanthropic wealth
creation vehicles
Shareholders pay 0.0% management fees and 0.0% performance fees for access to prominent domestic (FGX) and global (FGG) fund managers who act entirely pro bono
This outstanding generosity allows the Companies to donate 1% of net assets each
year to charities focused on supporting Australian children at
risk (FGX) and Australian youth
mental health (FGG)
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Australia’s first LICs with a dual purpose
FGX and FGG shareholders are changing lives for Australia’s most vulnerable children
Capital growth and fully franked
dividends
Unprecedented access to prominent
Australian and global fund managers
No management fees and no performance fees
Supporting Australian charities for children
at risk and youth mental health
Listed investment company structure benefits
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FGX investment objectives
The Company’s investment objectives are to:
Provide a stream of fully franked dividends
Achieve capital growth
Preserve shareholder capital
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FGX has invested in 17 funds managed by 16 managers
The allocation to the managers has been structured to provide a spread between three broad equity strategies:
• Long equities • Absolute bias • Market neutral
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2
3
FGX domestic fund managers
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FGX supported charities
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FGX Board and Investment Committee
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Board
Investment Committee
Geoff Wilson Gabriel Radzyminski Matthew Kidman
Jonathan Trollip (Chair)
Geoff Wilson (Founder) Gabriel Radzyminski Paul Jensen
Kate Thorley David Leeton Scott Malcolm David Paradice
FGX performance
FGX FY2015 highlights
Fully franked
2.0 cents per share dividend
$15 million pre-tax profit
$1.64 million donation
to Australian charities with a focus on children at risk
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$2.5 million management and
performance fees saved
FGX investment portfolio performance
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Since inception, FGX has significantly outperformed the
market with an 11.3% gain against
the ASX All Ordinaries
Accumulation Index
FGX outperformed in
100% of the six negative months
Since inception, the FGX portfolio has
achieved significantly less
volatility than the market with 8.4% standard deviation against the index’s
14.9%
FGX monthly portfolio performance
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*S&P/ASX All Ordinaries Accumulation Index
Month Sep 2014
Oct 2014
Nov 2014
Dec 2014
Jan 2015
Feb 2015
Mar 2015
Apr 2015
May 2015
Jun 2015
Jul 2015
Aug 2015
Sep 2015
Oct 2015
Since incep-tion
FGX portfolio -2.2% +1.5% -0.6% +1.4% +1.3% +4.1% +1.5% -0.6% +0.5% -3.2% +4.5% -2.7% +1.1% +3.9% 10.6%
Index* -4.9% +4.0% -3.2% +1.9% +3.0% +7.0% 0.0% -1.5% +0.6% -5.4% +4.2% -7.3% -2.5% +4.6% -0.7%
Outperformance +2.7% -2.4% +2.6% -0.6% -1.8% -2.9% +1.5% +0.9% -0.1% +2.2% +0.3% +4.6% +3.6% -0.7% 11.3%
FGX Net Tangible Assets as at 31 October 2015
The above figures are not diluted for 180,849,210 options on issue with an exercise price of $1.10 *These figures are after the tax payment of $174,000 (0.09 cents per share) in tax during the month
The below figures are after the payment of a fully franked 2.0 cents per share dividend
NTA before tax
115.10c NTA after tax and
before tax on unrealised gains
114.86c*
NTA after tax
114.48c
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Long equities 50.1%
Market neutral 17.2%
Absolute bias 24.3%
Cash 8.4%
Long equities
Market neutral
Absolute bias
Cash
FGX investment strategy allocation
As at 31 October 2015 (% of assets)
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FGX allocation at 31 October 2015
Fund manager Investment Strategy % of assets
Paradice Investment Management Large/Mid Cap Funds (split out below) 10.4%
Paradice Australian Equities Mid Cap Fund Long equities 5.6%
Paradice Large Cap Fund Long equities 4.8%
Regal Funds Management Regal Australian Long Short Equity Fund Long equities 10.4%
Bennelong Australian Equities Partners Bennelong Australian Equities Fund Long equities 10.1%
Wilson Asset Management (International) Wilson Asset Management Equity Fund Absolute bias 8.1%
Watermark Funds Management Watermark Absolute Return Fund Market neutral 7.8%
Eley Griffiths Group Eley Griffiths Group Small Companies Fund Long equities 7.6%
Tribeca Investment Partners Tribeca Alpha Plus Fund Absolute bias 7.1%
Cooper Investors Cooper Investors Australian Equities Fund Long equities 5.2%
Optimal Fund Management Australia Optimal Australia Absolute Trust Market neutral 5.0%
Sandon Capital Sandon Capital Activist Fund Absolute bias 4.1%
Discovery Asset Management Discovery Australian Small Companies Fund Long equities 3.7%
LHC Capital LHC Capital Australia High Conviction Fund Absolute bias 3.4%
Bennelong Long Short Equity Management Bennelong Long Short Equity Fund Market neutral 3.0%
Smallco Investment Manager Smallco Broadcap Fund Long equities 2.7%
Lanyon Asset Management Lanyon Australian Value Fund Absolute bias 1.6%
Qato Capital Qato Capital Market Neutral L/S Fund Market neutral 1.4%
Cash and Term Deposits Cash 8.4%
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FGX’s philanthropic impact
$1.64 million donated to Australian non-profits
following nine months of operations in FY2015
40% of FGX shareholders
participated in directing their pro rata of charitable allocations
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FGX donations to charities
Designated charities $ Amount Diabetes NSW $76,560.79
Raise Foundation $88,570.30
Giant Steps $118,717.86
Youth off the Streets $90,322.77
Australian Indigenous Education Foundation $104,372.13
United Way $84,662.14
Mirabel Foundation $96,259.93
Kids Helpline $94,764.61
Lighthouse Foundation $172,923.29
Variety $80,160.65
Act for Kids $89,768.93
Youth Focus $88,131.40
Debra $82,283.80
Australian Children's Music Foundation $87,456.74
Directed charities
Children at risk charities $206,989.05
Australian charities $82,070.58
TOTAL CHARITIBLE ALLOCATION $1,644,014.97
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FGG investment objectives
The Company’s investment objectives are to:
Provide a stream of fully franked dividends
Achieve capital growth
Preserve shareholder capital
1
The allocation to the managers has been structured to provide a spread between three broad equity strategies:
• Long equities • Absolute bias • Quantitative strategies
2
3
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FGG our global fund managers
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FGG supported charities
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FGG service providers
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FGG Board and Investment Committee
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Board
Belinda Hutchinson (Chair)
Sue Cato
Sarah Morgan Karen Penrose
Frank Casarotti Geoff Wilson
Investment Committee
Amanda Gillespie Aman Ramrakha
Sean Webster Geoff Wilson
Louise Walsh Chris Donohoe
Joint Chief Executive Officers
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FGG performance
FGG YTD highlights
The portfolio is now 95.8% invested with Future Generation Global Investment Company’s (FGG) 20 fund managers in the underlying funds excluding the 5.5% cash holding
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95.8%
NTA as at 31 October 2015
Net Tangible Assets (NTA) figures
*The above figures are not diluted for 274,413,666 options on issue with an exercise price of $1.10.
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NTA before tax
110.03c NTA after tax and
before tax on unrealised gains
110.60c
NTA after tax
110.02c
Investment strategy allocation
Investment strategy allocation (% of assets)
Long equities 53.4%
Quantitative strategies
6.3%
Absolute bias 34.8%
Cash 5.5%
Long equities
Quantitative strategies
Absolute bias
Cash
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Allocation at 31 October 2015
Fund manager Investment Strategy % of assets
Magellan Asset Management Magellan Global Fund Long equities 10.1%
Ironbridge Capital Management Ironbridge Global Focus Fund Long equities 10.1%
Cooper Investors Cooper Investors Global Equities Fund (Unhedged) Long equities 8.5%
Antipodes Partners Antipodes Global Fund Absolute bias 7.6% Marsico Capital Management Marsico Global Fund Long equities 7.4% VGI Partners VGI Partners Funds Absolute bias 7.4%*
Nikko Asset Management Australia Nikko AM Global Share Fund Long equities 5.9%
Manikay Partners Manikay Global Opportunistic USD Fund Absolute bias 5.0%
Ellerston Capital Ellerston Global Investments Wholesale Fund Absolute bias 4.9%
Morphic Asset Management Morphic Global Opportunities Fund Absolute bias 4.4%
Neuberger Berman Australia Neuberger Berman Systematic Global Equities Trust Quantitative strategies 3.9%
Cooper Investors Cooper Investors Asian Tiger Fund Long equities 3.4%
Paradice Investment Management Paradice Global Small Mid Cap Fund Unhedged Long equities 3.4%
Antipodes Partners Antipodes Asia Fund Absolute bias 2.5%
Tribeca Investment Partners Tribeca Global Total Return Fund Quantitative strategies 2.4%
Avenir Capital Avenir Value Fund Absolute bias 1.6%
Optimal Fund Management Optimal Japan Absolute Long Fund Long equities 1.6%
Hunter Hall Investment Management Hunter Hall Global Equities Trust Long equities 1.5%
Insync Funds Management InSync Global Titans Fund Long equities 1.5%
Eastspring Investments (Singapore) Eastspring Investments Asian Dynamic Fund Absolute bias 1.4%**
Cash and Term Deposits Cash 5.5%
*Investment into the VGI Partners Funds will be deployed over a four month period (Sept - Dec-15), the above reporting reflects the final investment. **Investment into the Eastspring Investments Asian Dynamic Fund was made on 5 November 2015. The above breakdown reflects this investment.
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Investor communications
News from our Future
Generation network Half yearly
national investor presentations
Half & full year financial results
Independent research
Website futuregeninvest.com.au
Monthly NTA announcement
& investment update including featured fund manager &
charity profile
Media Industry conferences
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Together, we are investing in Australia’s future generation
Contact us
T: (02) 9247 9202
F: (02) 9247 6855
W: www.futuregeninvest.com.au
Twitter: @FutureGenInvest
LinkedIn: Future Generation Investment Companies
