Azimut Group Analyst Update Montecarlo, January 9th 2020
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Azimut Group
Analyst Update
Montecarlo, January 9th 2020
Value creation amongst other Italian financials
Share price performance since IPO vs. Italian financials
Perf. Total Return
800 AZIMUT 506% 1023%
FINECO 179% 227%
MEDIOLANUM 72% 243%
700
MEDIOBANCA 2% 79%
GENERALI -15% 50%
600 INTESA SANPAOLO -25% 64%
FTSE MIB -14% 54%
500
400
300
200
100
0
2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
AZM IM Equity BMED IM Equity FBK IM Equity ISP IM Equity G IM Equity MB IM Equity FTSEMIB Index
Source: Bloomberg at 8/01/2020
2
Value created for long term shareholders
One of the best success stories in the Italian market
Media Società
FTSE MIB
Total Return +54% +1023%
1° Best total return stock amongst all financials within FTSE MIB since 2004
3° Best Total Return stock among all FTSE MIB members from 2004
Fonte: Bloomberg
Source: Bloomberg at 08/01/2020.
3
Azimut Net Weighted Average Performance to clients
2019: +8.5% net weighted average performance to clients, above industry
10,00%
9,00%
8,00%
7,00%
6,00%
5,00%
4,00%
3,00%
2,00%
1,00%
0,00%
-1,00%
Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19
Azimut Net WAP Risk Free
Source: Company data at 31/12/2019 and Bloomberg
Italian industry: FIDMGEND. Risk free: MTSIBOTR Index. 4
Italy Private Markets Update
AuM Today Total AUM
Investment Fund Type Country Size (€M)
(€M) (€M)
IPO CLUB PE ITA 150 150
ANTARES AZ1 PD ITA 128 128
Currently CORPORATE CASH PD ITA 50 50 €0.7-0.8
Managed FINANCE FOR FOOD PE ITA 150 85 bln
FSI PE ITA 70 70
CORPORATE CASH PLUS PD LUX 250 250
DEMOS 1 PE ITA 350 140
GLOBALINVEST PE (FoF) ITA 300 40
Under fund ITA 500 PE (VC) ITA 40 €1.1-1.2
raising /
PRIVATE DEBT (reopening) PD ITA 50 bln
lauching phase
ESG (ELTIF) [under approval] PE / PD ITA 200
OPHELIA (ELTIF LUX) [under approval] PE LUX 200
Being defined Equity – 3 projects PE 400-500
€2.6-2.9
(late 20-early Debt – 5 projects PD 1.400-1.500
bln
21) Real Assets – 2 projects Real Assets 800-900
PE = Private Equity ; PD = Private Debt
Real Estate: A new c. € 800m fund dedicated to Real Estate and Social Infrastructure
(ESG compliant) lead by Andrea Cornetti, previously General Manager of Prelios SGR
Source: Company Data
5
Italy Private Markets Update
Club Deal:
Commitment over € 1 bn AUM
6 0 mln €
250 Italian Wine Brands
6500* 284 Pharmanatura
clients investiments Digital Value
EdtechX
6 0 mln€
IPO C3
150
140 Club Deal Project Steel
127 120 Club Deal Project Pack
70 85
50 56
40
Private equity Private debt IPO Club Private debt Demos 1 GlobALInvest Corporate Corporate Finance for Other
Institutional Institutional Retail Cash Plus Cash Food (Start up)
N°Clients 9 19 155 2.140 4.304 60 40 21 11 12.000
N°Investiments 7 14 9 - Funding Funding - 20 - 234
phase phase
+115.3% +72% + 80% N e w Entry
From 1 8 July 2 0 1 7 From 8 November From December Aerospace Technologies
2018 2014
+4 6 9 % * * * +2 . 6 0 8 % **
+ 100%** Turnover growth
Turnover growth since
From the first half of 2015
2013 since 2 0 1 6
Data as of December 2019. Source: AGC and Mamacrowd.
* Excluding Other (Start up). ** Estimated value at fair market 6
value 29. *** Company operations P101Italy Private Markets Update
Venture Capital Fund – Italia 500
• Seed
Investment type • Early Stage
• Late Stage
Target Fund Size • EUR 40 million
Min. subscription
• EUR 5.000
amount
• 10 years
Tenor (possibly
Asset Allocation
extendable)
Later
Start-up
Stage
Source: Company Data
72019: Inflows & AUM
Strong growth in AUM thanks to solid inflows & good performance delivery to clients
Total Assets breakdown (€bn)
Italy International *
* Total Assets reaching all time high at
€59.1bn
c. 2x Net Inflows in 2019 at €4.6bn, almost entirely
59.1
organic, from both Italy and International
50.8 Italy on an organic basis is 130% higher
50.4
than 2018
17,1
43.6 International continues to contribute
12,5 13,8 thanks to global diversification
36.7 7,7 Net Performance above industry : +8.5%
4,3
30.0
Organic (ex. M&A) Net Inflows (€bn):
2,1
4.1
4
42,0
4
35,9 37,9 37,0
4
32,4 4
27,9 4
4 3,5
3
3
3
2014 2015 2016 2017 2018 2019 2018 2019
Source: Company data
Note*: through AZ International Holdings 8The record year at the end of a challenging plan
2019 Target 2019E Preview 2019 Highlights
€ 50mn recurring profit per
Estimated € 1.00 - 1.03bn quarter
-
Revenues Strong International EBITDA
growth
HQ restructured, regaining
Estimated efficiency
€ 300mn € 360-370mn
Net Profit Reorganization of Asset
Management portfolio
Performance to clients and
Cumulative
>75% ≥ 7.8 p.s. stakeholders
Payout
Dividend
>60% (≥ 90% Payout) Flat SG&A 2019 vs. 2018
2015-2019E
Source: Company data 9International Business: 2019 showing further improving trends
EBITDA keeps on growing at a significantly higher pace than Assets
Total Assets (€bn) Total Revenues(1) (€mln)
160
20
16 120
12
80
8
40
4
0 0
2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015 2016 2017 2018 2019
EBITDA(2) (€mln) EBITDA Margin
60 40%
50
30%
40
30 20%
20
10%
10
0 0%
2012 2013 2014 2015 2016 2017 2018 2019 2012 2013 2014 2015 2016 2017 2018 2019
Source: Company data.
Note (1): Revenues `reclassified as per management accounts. Note (2):
10
EBITDA reclassified as per management accounts, excluding one-offs`Macro-area update: Americas
Consolidated leading presence in Latam, growing in Distribution and Private Markets in the US
2019 Total Assets €6.1bn
New York (AACP)
2019 Net Inflows €0.8bn
Miami
Mexico Brazil:
Best in class portfolio management team focusing on
Equities, Long/Short, Macro, Fixed Income, Credit, Arbitrage,
Impact and Private Pension funds
Proprietary distribution focused on Wealth Management
Chile:
Marketing of UCITS funds to local investors and future
upgrade into AM license
Brazil
Mexico:
Chile Largest independent distribution network
Growing in local AM, currently 3 onshore mutual funds
USA:
AUM and clients on-boarding under way. Synergies with
Asset Management Brazilian operations yet to be fully exploited
Distribution
Launched AACP to acquire minority GP stakes in Private
Private Markets
Equity and Private Credit
11
11Macro-area update: Europe & Middle East (ex-Italy)
Steady growth in Europe, market leader in Turkey and further upside from the MENA region
2019 Total Assets €4.8bn
2019 Net Inflows €0.6bn
Switzerland:
Consolidating local managers, growing an
independent platform
Ireland
U.A.E.:
Luxembourg
Switzerland
Developing an integrated platform in Dubai and Abu
Dhabi
Turkey
Monaco
Turkey:
Operating since 2012, leading independent asset
Egypt manager with a 5% market share
UAE Manager of one of the largest global sukuk funds in
the world
Monaco:
Doubled AUM in 5 years, targeting UHNWI
Asset Management
Distribution Egypt:
Entering in the Egyptian market acquiring a leading
independent player 12
12Macro-area update: Asia-Pacific
Market leader in Australia, while focusing on growth and scale in other geographies
2019 Total Assets €6.1bn
2019 Net Inflows €1.0bn
Asia:
Shanghai China/HK:
Taiwan
Granted Private Fund Manager license: first amongst
eurozone asset managers
Hong Kong
Taipei:
Expanded scope, including FAs and insurance brokerage
Singapore:
Singapore
Scaling up WM capabilities, focus on managing local
products & distributing to HNW and Family Offices
Australia:
Developing local production through Sigma funds
management attracting top tier institutional investors
Asset Management Expanded considerably AZ NGA franchise through M&A
Australia and organic growth. JV activity to continue in 2018
Distribution
Sestante: launch of own funds ongoing
13
13Case Study: XP
A snapshot on how a similar platform to Azimut Brazil is currently valued by the market
XP Azimut Brazil
2019E Net Flows • R$ 90bn • R$ 5bn
Latest AUM • R$ 350bn • R$ 25bn
2019 #Clients • 1,200,000 • 150,000
FY 2019 Net Profit • R$ 925m • ca. R$ 55m
FY 2020 P/E 66x
FY 2021 P/E 42x
Market Cap • R$ 85.2bn • …?
Fonte: Company data.
14Updated Sum Of The Parts of the International Business
According to market multiples & precedents, foreign business could be worth ca. € 1.5 - 2 bn
€m
Australia 800 – 1000 IRR(1): +28%
CoC: 5.5x
Brazil 500 – 700
Switzerland and 100 –
Monaco 200
125 –
Others
150
Total International
Operations (€bn)
1.5 – 2.0
Market Cap*
3.1
Azimut (€bn)
Source: Company Data, Bloomberg, market multiples & selected
precedent transactions. Note*: at 08/1/2020. 15
Note (1): assuming a 2011 start, total investments of €317mln, €1.75bn as of todayBeing big does not mean being better ... on the contrary
Bn local currencies
Net Inflows 2019E % AuM 2018 Net Income 2019E NI/AuM 2019
4.6 9.1% 0.37 0.62%
Blackrock 385.6 7.0% 3.88 0.06%
Amundi - Pionner 39.7 2.8% 0.95 0.06%
Schroders 23.4 5.6% 0.64 0.12%
DWS 18.3 2.7% 0.42 0.06%
6x
Man Group -2.1 -2.2% 0.21 0.20%
Janus Henderson -25.1 -7.4% 0.42 0.13%
Invesco -25.7 -2.9% 1.02 0.10%
Franklin Templeton -28.7 -4.6% 1.08 0.17%
Standard Life Aberdeen -70.3 -12.4% 0.54 0.09%
Average Peers -1.3% 0.11%
Delta Average 10.3% 0.51%
Source: Company Data, Factset.
16US Private Markets initiative (1/3)
Azimut Alternative Capital Partners (“AACP”): the project Team
Jeffry Brown: previously
Newco set up to build a next generation, diversified and one of the first
multi-affiliate investment firm acquiring initially minority GP Managing Directors at
stakes in alternative asset managers
Dyal Capital
(Neuberger Berman),
one of the leading
Initial focus on U.S. Private Credit, Private Equity, minority stake investors
Infrastructure and RE
in alternative managers.
Prior to Dyal, senior roles
at Bear Stearns AM and
Access to strong and consistent cash flow generation MS AM.
delivered at the GP level, further enhanced in AACP
Executed over 50
given greater diversification and lean cost base
transactions on $135bn
in AUM, including 33 GP
Focus on large, growing and at the same time under- stakes.
shopped segment of sub USD 3bn alternative managers Other key senior
with high current positive EBITDA managers already
identified joining shortly
Source: Company data
17US Private Markets initiative (2/3)
The Structure Azimut targets
$ 7 billion pro-rata AUM
Azimut
Alternative (in excess of $ 20 billion
Capital Partners gross AUM) in 10 years
("AACP") Consistent, high quality EBITDA
cash flow from predictable
Funded through a
recurring fees and further
Permanent capital upside from carried interest / meaningful equity
supporting growth and/or performance fees. Potentially commitment by Azimut
generational change additional products/capacity
together with additional
for our clients worldwide
(local) leverage and
retained earnings
Target to acquire ca. 10
alternative asset
managers, diversified
25%-49% 25%-49% 25%-49% across Private Credit,
Private Equity and at a
Infrastruct. /
Private Private later stage Real
Real Estate
Credit GP Equity GP
GP Estate/Infrastructure
Highly positive EBITDA
generation of underlying
managers
Source: Company data
18US Private Markets initiative (3/3)
Significant addressable Market…
# of Alternative AACP
Managers Target Market
1,500
300
257
AuM 54
$3bn
Private Equity Private Credit
… With very limited competition
Source: Company data
19Where are the others going?
20Azimut and ESG
The history of Azimut Group in the sustainability context
1995 Launched In Italy Azimut Solidarietà (today Azimut Solidity), the first Italian ethical
investment fund that donates part of its returns to charity.
2014 In Luxembourg, launched the AZ Multi Asset Sustainable Hybrid Bonds segment, dedicated
to foreign institutional customers (open to Italian retail clients in Italy from 2019). The first
ESG compliant fund investing in hybrid bonds in Europe.
Launched In Italy the Luxembourg multi-asset segment AZ Multi Asset Sustainable Absolute
Return
2016 AZ Multi-Asset Sustainable Absolute Return becomes AZ Multi Asset Sustainable Equity
Trend. Activated the personalized service for the transfer of proceeds to non-profit
organizations / foundations, making the product one of the first in Italy to offer this service.
Launched in Brazil the AZ Quest Azimut Impacto fund financing social impact initiatives
(dedicated to environment, education and community development). It is the first fund
launched in Brazil accessible to retail investors, allowing investors to participate in social
impact initiatives.
2019 Launched in Italy the Luxemburg fund AZ Equity - Global ESG.
Launched in Egypt the ATAA Fund, charitable fund assisting people with disabilities. It is the
first of its kind in Egypt.
Azimut Sustainable project involving the AZ Fund Management SA product range
Fonte: Company data.
21Azimut and ESG
Attention to sustainability in Italy
1995 – Azimut Solidity
In 1995, launched Azimut Solidarietà (today Azimut Solidity) the first Italian ethical investment fund
donating part of its returns to charity.
The Fund has 8 partners engaged in social and humanitarian activities (Unicef, Missioni Don Bosco,
Fondazione Exodus, Missionari Comboniani, Gaslini among the others). Its investors can choose one or
more as recipients of the proceeds.
Azimut also contributes by donating part of its commission directly to the partners, proportionately to the
choices of the investors.
2016 – AZ Multi Asset Sustainable Equity Trend
Since 2016, AZ Multi Asset Sustainable Equity Trend has enabled Group customers to identify and select
the charity entities that they consider "most active" in their regions and to donate them the income
generated by their investments.
This initiative has also allowed the creation and development of active synergies between the Financial
Advisors of Azimut Capital Management and the local foundations / non-profit organizations, through
events, conferences, presentations, exhibitions, etc.
More than 45 non-profit organizations / foundations selected and involved in the project;
Some examples of the most funded non-profit organizations / foundations: Associazione Piano Terra
Onlus (Lazio) - Slums Dunk (Lombardia / Triveneto), Queen of Piece (Lombardia).
Fonte: Company data.
22Azimut and ESG
Azimut Sustainable Initiatives
At the level of AZ Fund Management product range, the main interventions will be:
The integration of ESG principles in the investment process and risk management thanks to the creation of
Q4 an internal ESG rating. Target to reach €7bn (ca. 30% of the entire AZ Fund Management assets) by end-
2019 2019 has been surpassed and is now at €9bn. These assets are invested in companies with a BBB rating or
above, based on the ESG criterias of MSCI.
Q1 The creation of a line of full SRI sectors and thematic products
2020
On The establishment of a Sustainability Committee within the Investment Department.
Going
This is the largest intervention ever made in Italy
in terms of converting investments to ESG
Fonte: Company data.
232020: updated guidance
Main Trends for 2020 Upgraded guidance 2020 (under normal market conditions)
Recurring Revenues
Italy
International
Private Markets
Variable Fees ?
Net Profit Floor at
Distribution costs (as % of Recurring Revenues)
€ 300 mn
Rebate
Recurring Revenues
Overheads
Fixed costs +/-5% vs. 2019(1)
Source: Company data.
24
(1) Excluding any extraordinary operationsContacts
Investor Relations Contacts
Vittorio Pracca
Tel. +39.02.8898.5853
Email: vittorio.pracca@azimut.it
Galeazzo Cornetto Bourlot
Tel. +39.02.8898.5066
Email: galeazzo.cornetto@azimut.it
www.azimut-group.com
Disclaimer – Safe harbour statement
This document has been issued by Azimut Holding just for information purposes. No reliance may be placed for any purposes whatsoever on the information
contained in this document, or on its completeness, accuracy or fairness. Although care has been taken to ensure that the facts stated in this presentation are
accurate, and that the opinions expressed are fair and reasonable, the contents of this presentation have not been verified by independent auditors, or other third
parties.
Accordingly, no representation or warranty, express or implied, is made or given by or on behalf of the Company, or any of its members, directors, officers or
employees or any other person. The Company and its subsidiaries, or any of their respective members, directors, officers or employees nor any other person acting
on behalf of the Company accepts any liability whatsoever for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in
connection therewith.
The information in this document might include forward-looking statements which are based on current expectations and projections about future events. These
forward-looking statements are subject to risks, uncertainties and assumptions about the Company and its subsidiaries and investments, including, among other
things, the development of its business, trends in its operating industry, and future capital expenditures and acquisitions. In light of these risks, uncertainties and
assumptions, the events in the forward-looking statements may not occur. No one undertakes to publicly update or revise any such forward-looking statement.
The information and opinions contained in this presentation are provided as at the date of this presentation and are subject to change without notice.
Any forward-looking information contained herein has been prepared on the basis of a number of assumptions which may prove to be incorrect and, accordingly,
actual results may vary. This document does not constitute an offer or invitation to purchase or subscribe for any shares and/or investment products mentioned and no
part of it shall form the basis of or be relied upon in connection with any contract or commitment whatsoever.
The information herein may not be reproduced or published in whole or in part, for any purpose, or distributed to any other party. By accepting this document you
agree to be bound by the foregoing limitations.
The Officer in charge of the preparation of Azimut Holding SpA accounting documents, Alessandro Zambotti (CFO), declares according to art.154bis co.2 D.lgs.
58/98 of the Consolidated Law of Finance, that the financial information herein included, corresponds to the records in the company’s books.
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