Quil ter Basic B rand Guidelines Our b rand a ss ets 1 Interim results 2020 11 August 2020
Disclaimer This presentation should be read in conjunction with the announcement published by Quilter plc on 11 August 2020. This presentation may contain certain forward-looking statements with respect to certain Quilter plc’s plans and its current goals and expectations relating to its future financial condition, performance and results. By their nature, all forward-looking statements involve risk and uncertainty because they relate to future events and circumstances which are beyond Quilter plc’s control including amongst other things, international and global economic and business conditions, the implications and economic impact of the COVID-19 pandemic, the implications and economic impact of several scenarios of the UK’s future relationship with the EU in relation to financial services, market related risks such as fluctuations in interest rates and exchange rates, the policies and actions of regulatory authorities, the impact of competition, inflation, deflation, the timing and impact of other uncertainties of future acquisitions or combinations within relevant industries, as well as the impact of tax and other legislation and other regulations in the jurisdictions in which Quilter plc and its affiliates operate. As a result, Quilter plc’s actual future financial condition, performance and results may differ materially from the plans, goals and expectations set forth in Quilter plc’s forward looking statements. Quilter plc undertakes no obligation to update the forward-looking statements contained in this presentation or any other forward- looking statements it may make. Nothing in this presentation should be construed as a profit forecast. Nothing in this presentation shall constitute an offer to sell or the solicitation of an offer to buy any securities. 2
Presentation agenda Business review Paul Feeney Financial review Mark Satchel Concluding remarks Paul Feeney Q&A 3
Executive summary: Delivering through disruption Strategic progress Financial performance Operational improvement £71m adjusted profit before Significant Platform migration Optimisation initiatives on tax: Pleasing outturn in a scheduled for Q4 2020 track to deliver c.£50m cost challenging environment saves Incremental tactical cost reduction of c.£30m in 2020 Stable gross flows, resilient Lighthouse acquisition integrated flows, significantly integration progressing well, in improved net flows Added new investment line with plan managers and Restricted Financial Planners Strong rebound in AuMA from Key management changes Technology upgrades and new March lows, closing at announced to drive next stage system enhancements £107.4bn at end-June of Quilter’s growth implemented, remotely 4
Maintaining support to all stakeholders in wake of Covid-19 pandemic Clients and Advisers Products: Supporting growth across the generations Colleagues c.98% of colleagues in UK and internationally working Accelerated delivery of IT and remote telephony remotely at lock-down peak solutions maintained high service levels Active colleague engagement strategy – “Thrive” “There for you” programme rolled out to over 23,000 wellbeing programme supporting remote working and advisers across the UK offering help on topical issues those struggling with isolation Encouraged digital access and provided online Deferred certain Optimisation initiatives materials for advisers to share with clients Communities Ease of use: Single-source potential for Quilter RFPs Investments: Opportunity to reengage with inactive firms Shareholders Quilter Financial Adviser School’s first Diploma module, Balance sheet strength in challenging times available free online. Over 300 people signed up during lockdown Buybacks of c.£76m completed to date¹ £200k donated to the UK National Emergencies Trust Completion of the Odd-lot Offer Volunteers remotely supporting Young Carers Trust 1.0p interim dividend In unchartered waters, we must be guided by our values; Our priority is to protect our employees, while serving the customers and advisers who rely on us. 5 1. As at 7 August 2020.
2020: Improving net flows Gross sales Gross outflows Net flows 5 1 o/w DB transfers o/w QC IM departures 4 Substantial improvement in net flows: from £0.3bn to £1.1bn 3 0.5 Stable gross sales and integrated flows Gross sales / outflows (£bn) 2 Advisers highly engaged with clients, supporting them navigate volatility and Net flows (£bn) 1 uncertain times 0 COVID-19 accelerated industry-wide 0 trend for switching to Passive/Blend solutions -1 Welcomed FCA announcement on plans -0.5 -2 to reform DB transfer market – wholly consistent with existing Quilter practice -3 -4 -1 Q1 19 1 Q2 19 2 Q3 19 3 Q4 19 4 Q1 20 5 Q2 20 6 6 Note: All figures exclude QLA.
Investment performance Quilter Cheviot returns Cirilium & WealthSelect MPS Quilter Cheviot performance vs. ARC Sterling PCI, as at 31 March 2020 Performance vs respective Investment Association sector average Cumulative returns: as at 30 June 2020 Relative % – +0.3 +0.3 Relative % vs ARC PCI -2.6 +4.3 -2.4 +6.1 -6.7 +1.9 -7.4 +3.3 -8.3 vs IA Sector Balanced Steady Growth Equity Risk 30% 0% 20% 3 year -1% 3 year 10% -2% 0% -3% vs. IA MI 0-35% vs. IA MI 20-60% vs. IA MI 40-85% vs. IA Flex Inv. vs. IA Global Relative % Relative % +1.5 +1.2 +0.8 -1.6 +0.5 +7.3 +2.6 +2.3 +4.9 +5.8 -2.8 -9.2 vs ARC PCI vs IA Sector 15% 60% 5 year 10% 5 year 40% 5% 20% 0% 0% vs. IA MI 0-35% vs. IA MI 20-60% vs. IA MI 40-85% vs. IA Flex Inv. vs. IA Global Balanced Steady Growth Equity Risk Relative % Relative % +16.5 +14.1 +14.4 +16.3 vs ARC PCI +15.8 +3.4 vs IA Sector 80% 100% 60% 10 year 10 year 40% 50% 20% 0% 0% vs. IA MI 20-60% vs. IA MI 40-85% vs. IA Flex Inv. Balanced Steady Growth Equity Risk Cirilium WealthSelect MPS IA benchmark QC PCI ARC PCI Note: Past performance is not a guide to future performance and may not be repeated. Cirilium Active and Passive or WealthSelect MPS Active and Blend, total return net of fund fees, percentage growth is AUM weighted. Cirilium Blend has not been included due to not having a 3 year track record. UK: Suitable for professional clients.
UK Platform Transformation Programme Mar – Dec 2019 2020 2021 Jul – Nov 2017 2018 Functional testing & Phased migrations migration planning Soft launch Build Design Migration Migration Migration Final Final system code Testing delivery migration rehearsals 1 2 First migration successfully undertaken Adviser engagement and readiness key to final migrations New platform continues to operate well and at scale Second migration of c.2,000 adviser firms to capture Continued focussed support for advisers and customers majority (c.75%) of AuA and include QFP Adviser feedback driving system improvements Final migration represents c.5,500 adviser firms with c.15% of AuA Lessons learnt from first migration incorporated into further migration Total programme costs expected to be c.£200 million planning Successful migration of customers and advisers is the gateway to a strong business relationship over time … new platform will be the beating heart of Quilter 8 Complete To come
Improving cohesion between our business capabilities Source Destination Affluent and Mass-Affluent Quilter Restricted Financial Planners (QFP & QFA) Multi-asset, risk-adjusted Quilter Investors Customers: Quilter Investment Platform solutions Switches Independent Financial Advisers Third party products /funds External Platforms Bespoke portfolios High net worth Quilter Restricted Financial Customers : Planners (PCA) Quilter International Quilter Cheviot DFM Independent Quilter Cheviot Financial Advisers Two strong distribution channels Open architecture investment solutions 9
Our objective remains unchanged: Building a modern, advice-led wealth manager Customer choice: quality-assured choice not unlimited, bewildering choice Value for money: Competitive pricing across the value chain; transparent and flexible Accessibility: Designed around our clients, who can chose how they access us Ease: Aim to be easy to do business with, increasingly by a digital-first approach Operating responsibly is aligned with Quilter values 10
Financial review Mark Satchel 11 August 2020
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