Manchester and London Investment Trust plc. Shareholder Meeting – 14 th January 2020. The Members’ Room, ICAEW, Chartered Accountants' Hall, Moorgate Place, London, EC2R 6EA. M&L Capital Management Limited. 12a Princes Gate Mews, London, SW7 2PS. Tel +44 (0) 20 7584 5733
MNL LN: The medium term context. Performance continues: 3 year Total Return on Share Price is 106.7%! 2 Source: Bloomberg Finance L.P
Keeping ahead of the Famous/Overbought competition: Rebalance your Portfolio! Last 3 years: we Beat all of Scottish Mortgage, FundSmith, Polar Capital Tech, Lindsell Train . 3 Source: Bloomberg Finance L.P
MNL LN: Increasing Liquidity & Materially Lowering Cost per Share. Market Capitalisation growth ~3x in 3 years from~£60m to ~£180m. 4 Source: Bloomberg L.P
Dividend History - 5 year trend continues Yield now 2.6% (Source: FT). 16 14.00 13.75 14 13.36 12.00 12 10 9.00 8 6.00 6 4 2 0 Dividend per Share (p) 5 Source: MLCM
What are the 3 key Growth drivers for MNL LN now? 6
MNL LN Top Growth Drivers: Software as a Service Global Software as a Service (SaaS) Market 7 Source: Statista
MNL LN Top Growth Drivers: Public Cloud. Microsoft expect Global IT spend to increase from ~5% of GDP to > 10% in the next decade. 8 Source: Statista
MNL LN Top Growth Drivers: E-Commerce. Further growth to come from Instagram Shopping, Google Shopping and other new avenues driven by 5G. 9 Source: eMarketeer
What are the key Risks for MNL LN now? 10
3 Key Risks: Regulation of Tech. has Expanded from EU to USA to Global. “Communities have historically been formed and controlled by physical and geographical parameters in the formation of nations. In the future, communities will move from being physical to online, resulting in legacy political power systems becoming increasingly redundant. ” (Asimov) 11
3 Key Risks: The New Cold War - the USA China Tech War for Supremacy. https://www.economist.com/news/leaders/21738883-americas-technological-hegemony-under-threat- china-battle-digital-supremacy 12 Source: The Economist
3 Key Risks – Debt & the Yield Curve 13 Source: Bloomberg L.P
Proven as the best Strategy for Returns! 14
IP & Growth: The best Strategy to beat the market. SPX - S&P 500 - TRACKERS S5CONS - S&P 500 Consumer Staples Sector - QUALITY NDX - Nasdaq 100 - TECH & IP HSI - Hang Seng (proxy for developing markets) - ASIA CPI - US Consumer Prices Index - CASH at BANK RTY - Russell 2000 (proxy for small companies) - SMALL CAP 1 5 Source: Bloomberg Finance L.P.
Key Investment Metric: Similar Valuation Multiples, Faster Growth. 16 Source: Bloomberg L.P
History shows sectors grow for multi decades: Energy ~100yrs, Staples >100 years. 17
Some predictions for the Next Decade. 1. Over the next year, passive general index Equity market gains will be sparse. 2. Within Two years, the Net Asset Value of MNL LN may have broken above £200m (This is not a forecast, it is a statement of hope). 3. Within Three years, Disney will be acquired by a Tech Gorilla. 4. Within Four years, ten year treasury yields will break new lows . (The Japanification of the developed markets will become common thinking). 5. Over the next Five years, UK property prices will have stagnated. (The move to renting and the recent vast increases in Stamp duty will act as permanent drags on progress). 6. In Six years, the China/USA Trade War will still be an issue. (The consequence will have materially damaged a number of regions such as India and Europe). 7. In Seven years, the Nasdaq 100 index will have doubled from its current level. (This contrasts markedly with Prediction 8 & 1) (Driven by gains in SaaS, 5G, AI and Cloud focused stocks). 8. In Eight years, the FTSE100 will have stagnated having provided a low single digit annualised return at best. 9. In Nine years, the growth of Chinese SaaS will be viewed as one of the best investment opportunities of the last decade. 10. In Ten years, global oil demand will be in precipitous decline. 18
Disclaimer. This document is not a prospectus, but an advertisement and investors should not subscribe for any transferable securities based on the information contained in this presentation or any other research materials. This document is confidential and is being supplied to you solely for your information and may not be reproduced, redistributed or passed on, directly or indirectly, to any other person or published in whole or in part, for any purpose. Neither this document nor any copy of it may be sent to or taken into the United States, Canada, Australia, the Republic of Ireland or Japan, nor may it be distributed to any US person (within the meaning of regulation S under the US Securities Act of 1933, as amended). This document does not constitute or form any part of any offer or invitation or other solicitation or recommendation to purchase any securities. No reliance may be placed for any purpose whatsoever on the information, representations or opinions contained in this document, and no liability is accepted for any such information, representations or opinions. Without prejudice to the foregoing, this document must not be passed on, directly or indirectly, to any person in the United Kingdom other than a person who falls within Articles 19 or 49 of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (as amended). Manchester and London Investment Trust Plc, M&L Capital Management Ltd, nor any other person makes any guarantee, representation or warranty, express or implied as to the accuracy, completeness or fairness of the information and opinions contained in this document, nor does Manchester and London Investment Trust Plc, M&L Capital Management Limited, or any other person accept any responsibility or liability whatsoever for any loss howsoever arising from any use of this document or its contents or otherwise arising in connection therewith. The information contained in this document may amount to price sensitive information for the purposes of the Criminal Justice Act 1993 or relevant information for the purposes of the Code of Market Conduct and recipients should consider their positions carefully before undertaking any dealings. 19
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