Скачать презентацию Capstone Professional Development December 2010 Hamish Douglass Chief Скачать презентацию Capstone Professional Development December 2010 Hamish Douglass Chief

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Capstone Professional Development December 2010 Hamish Douglass Chief Executive Officer and Portfolio Manager, Magellan Capstone Professional Development December 2010 Hamish Douglass Chief Executive Officer and Portfolio Manager, Magellan Asset Management

Important Information This presentation (‘Presentation’) has been produced by Magellan Asset Management Limited (‘Magellan’) Important Information This presentation (‘Presentation’) has been produced by Magellan Asset Management Limited (‘Magellan’) ABN 31 120 593 946, AFS Licence No 304 301 and has been prepared for informational and discussion purposes only and does not constitute an offer to sell or a solicitation of an offer to purchase any security or financial product or service. Any such offer or solicitation shall be made only pursuant to a Product Disclosure Statement, Information Memorandum or other offer document (collectively ‘Offer Document’) relating to a Magellan financial product or service. A copy of the relevant Offer Document relating to a Magellan product or service may be obtained by calling Magellan on +61 2 8114 1888 or by visiting www. magellangroup. com. au. This Presentation does not constitute a part of any Offer Document issued by Magellan. The information contained in this Presentation may not be reproduced, used or disclosed, in whole or in part, without the prior written consent of Magellan. Past performance is not necessarily indicative of future results and no person guarantees the performance of any Magellan financial product or service or the amount or timing of any return from it. There can be no assurance that a Magellan financial product or service will achieve any targeted returns, that asset allocations will be met or that a Magellan financial product or service will be able to implement its investment strategy and investment approach or achieve its investment objective. Statements contained in this Presentation that are not historical facts are based on current expectations, estimates, projections, opinions and beliefs of Magellan. Such statements involve known and unknown risks, uncertainties and other factors, and undue reliance should not be placed thereon. Additionally, this Presentation may contain “forward-looking statements”. Actual events or results or the actual performance of a Magellan financial product or service may differ materially from those reflected or contemplated in such forward-looking statements. Certain economic, market or company information contained herein has been obtained from published sources prepared by third parties. While such sources are believed to be reliable, neither Magellan or any of its respective officers or employees assumes any responsibility for the accuracy or completeness of such information. None of Magellan or any of its respective officers or employees has made any representation or warranty, express or implied, with respect to the correctness, accuracy, reasonableness or completeness of any of the information contained in this and they expressly disclaim any responsibility or liability therefore. No person, including Magellan has any responsibility to update any of the information provided in this Presentation. Neither this Presentation nor the provision of any Offer Document issued by Magellan is, and must not be regarded as, advice or a recommendation or opinion in relation to a Magellan financial product or service, or that an investment in a Magellan financial product or service is suitable for you or any other person. Neither this Presentation nor any Offer Document issued by Magellan takes into account your investment objectives, financial situation and particular needs. In addition to carefully reading the relevant Offer Document issued by Magellan you should, before deciding whether to invest in a Magellan financial product or service, consider the appropriateness of investing or continuing to invest, having regard to your own objectives, financial situation or needs. Magellan strongly recommends that you obtain independent financial, legal and taxation advice before deciding whether to invest in a Magellan financial product or service. 2

3 Agenda • China – Peak Steel Intensity • Inflation v deflation • Magellan 3 Agenda • China – Peak Steel Intensity • Inflation v deflation • Magellan Global Fund – update • Questions

China – Peak Steel Intensity China – Peak Steel Intensity

Importance of Peak Steel Intensity to Australia • The mining sector represents 33 % Importance of Peak Steel Intensity to Australia • The mining sector represents 33 % of the ASX All Ordinaries Index • Iron Ore and Metallurgical Coal are Australia’s two largest exports: – 25% of total exports ($70 bn – 2009) – 43% of export growth past 7 years • Iron ore and coal prices have dramatically improved over the past 3 years – iron prices 3 year avg A$ 112 per tonne / A$35 per tonne 10 year avg (1998 – 2007) – Metallurgical coal prices 3 year avg A$ 232 per tonne / A$ 79 per tonne 10 year avg (1998 – 2007) • Dramatic improvement in the terms of trade over past 3 years 5

6 China – Fixed Asset Investment Facts • Fixed asset investment - 25% pa 6 China – Fixed Asset Investment Facts • Fixed asset investment - 25% pa growth over the past decade • Absolute value has dramatically accelerated: – Last 2 years FAI RMB 43 tn (USD 6. 43 tn) – Last 4 years FAI RMB 70 tn (USD 10. 5 tn) – Prior decade FAI RMB 43 tn (1997 – 2006) • Is China fast accelerating towards “peak commodity intensity” ?

7 China – Urban Fixed Asset Investment 7 China – Urban Fixed Asset Investment

8 Chinese Steel Production 8 Chinese Steel Production

9 Global per capita Steel Use 9 Global per capita Steel Use

10 Income Range of Peak Intensity of Use 10 Income Range of Peak Intensity of Use

Inflation v deflation Inflation v deflation

12 The deflationary/inflationary debate • Enormous countervailing forces at work • The deflationary debate 12 The deflationary/inflationary debate • Enormous countervailing forces at work • The deflationary debate is primarily a developed world issue • Enormous inflationary pressures in the emerging world (China, India, Russia, Brazil, etc) • Numerous developed countries with inflationary pressures (Australia, NZ, Denmark, Norway, Switzerland) • The deflationary debate is primary focused on major Northern Hemisphere economies (US, UK, France, Japan, Spain, Italy etc)

Potential sources of deflationary pressures • Persistent excess productive capacity • Prolonged period of Potential sources of deflationary pressures • Persistent excess productive capacity • Prolonged period of sub-par economic growth due to: • Consumer deleveraging • Government fiscal austerity measures • Structurally high and persistent unemployment • Prolonged low interest rates • Falling house prices • Embedded expectations of deflationary pressures • Continued shift to e-commerce 13

14 Medium term sources of inflationary pressures • Rising food and energy prices • 14 Medium term sources of inflationary pressures • Rising food and energy prices • Effects of global warming • Expansion of the money supply from quantitative easing • Central bank exit strategies • Imported price inflation due to inflationary pressures in emerging markets • Increased regulatory intervention • Increased taxation

Conclusions • Deflationary pressures are non-existent in emerging markets and in economies such as Conclusions • Deflationary pressures are non-existent in emerging markets and in economies such as Australia • Short term deflationary pressures in the US and Europe are likely to be overwhelmed by inflationary pressures in the medium term • Investors should be concerned about: • Anaemic economic growth for the foreseeable future • Rising long term bond rates • Rising inflation in the medium term • Stagflation may be a more realistic risk than deflation in the medium term 15

The Magellan Global Fund The Magellan Global Fund

17 Increase in your Purchasing Power Product Source (Aus & US sites respectively) Australia 17 Increase in your Purchasing Power Product Source (Aus & US sites respectively) Australia United States Nike Air Max Shoes (Men) A$200 US$100 www. nike. com i. Pad A$629 US$499 www. apple. com Levi Jeans A$120 US$32 Callaway FT-i. Z Driver A$519 US$399 www. drummondgolf. com. au; www. shop. callawaygolf. com Dell Inspiron 17' Laptop A$1, 249 US$699 www. dell. com John Deere Ride-On Mower (LA 115) A$3, 789 US$1, 699 Johnnie Walker Blue Label (750 ml) A$220 US$160 Source: Evans & Partners 2010 www. generalpants. com; www. macys. com www. deere. com www. getprice. com. au; www. missionliquor. com

China – Fixed asset growth v retail sales growth (2000 – 2010) 18 China – Fixed asset growth v retail sales growth (2000 – 2010) 18

19 Urbanising populations in emerging markets will drive long term economic growth Urban Population 19 Urbanising populations in emerging markets will drive long term economic growth Urban Population Growth Forecasts (million) Source: United Nations, Population Division of the Department of Economic and Social Affairs

Yum! Brands Yum! Brands

+3 54 China Urbanisation (million) Source: Mc. Kinsey 2010 21 +3 54 China Urbanisation (million) Source: Mc. Kinsey 2010 21

Yum! Operating Profit Contribution 2010 YTD *Magellan Forecasts 2015 F* 22 Yum! Operating Profit Contribution 2010 YTD *Magellan Forecasts 2015 F* 22

Yum! China – Robust Development Opportunity Assume ½ of China Population* is Middle Class Yum! China – Robust Development Opportunity Assume ½ of China Population* is Middle Class or above by 2030 Mc. Donald’s current penetration in the U. S. is ~40 Per Million Tim Horton’s current penetration in Canada is ~60 Per Million *Assumes China population is 1. 5 B in 2030 Source: Yum! Brands 23

Rapid Expansion Year After Year Source: Yum! Brands 24 Rapid Expansion Year After Year Source: Yum! Brands 24

Yum! China – Industry Leading Return on Assets Yum! China Delivered 2 x Asset Yum! China – Industry Leading Return on Assets Yum! China Delivered 2 x Asset Turnover for the last 4 consecutive years Source: Yum! Brands and 2009 Company Segment Reporting from Company 10 -K 25

KFC – Strong Unit Economics Strong Return – Sales Are 2 X Investment Source: KFC – Strong Unit Economics Strong Return – Sales Are 2 X Investment Source: Yum! Brands 26

Magellan Global Equities Portfolio Construction as at 30 November 2010 Source: Magellan Asset Management Magellan Global Equities Portfolio Construction as at 30 November 2010 Source: Magellan Asset Management Ltd 27

Magellan Global Fund 28 Top 10 as at 30 November 2010 Company % Portfolio Magellan Global Fund 28 Top 10 as at 30 November 2010 Company % Portfolio e. Bay Inc 8. 03% Wells Fargo 7. 41% Google Inc 6. 58% Coca-Cola Company 6. 34% Yum! Brands Inc 6. 30% Nestle 5. 69% Lowe’s 5. 34% Kraft Foods 5. 32% Colgate Palmolive 5. 19% US Bancorp 5. 17% Top Ten Holdings Cash Weighting 61. 38% 3. 37%

Portfolio strategy Always focus on quality and minimising the risk of permanent capital loss Portfolio strategy Always focus on quality and minimising the risk of permanent capital loss § Invest into extremely high quality “cash cows” with low risk exposure to consumer growth in the developing world § Invest into lowest cost, market leading, non-discretionary retailers § Invest into businesses that exhibit powerful “network economics” 29

Questions? Questions?