MLC Investment
Management
Annual Investor Review
Appendix: Wholesale
30 June 2011
General advice warning and disclaimer
This information has been provided by MLC Limited (ABN 90 000 000 402) a member of the National Group,
105–153 Miller Street, North Sydney 2060.
Any opinions expressed in this communication constitute our judgement at the time of issue and are subject to
change. We believe that the information contained in this communication is correct and that any estimates,
opinions, conclusions or recommendations are reasonably held or made as at the time of compilation. However,
no warranty is made as to their accuracy or reliability (which may change without notice) or other information
contained in this communication.
Past performance is not indicative of future performance. The value of an investment may rise or fall with the
changes in the market. Please note that all performance reported is before management fees and taxes, unless
otherwise stated.
The specialist investment managers are current as at the date this communication was prepared. Investment
managers are regularly reviewed and may be appointed or removed at any time without prior notice to you.
This communication contains general information and may constitute general advice. Any advice in this
communication has been prepared without taking account of individual objectives, financial situation or needs. It
should not be relied upon as a substitute for financial or other specialist advice.
Before making any decisions on the basis of this communication, you should consider the appropriateness of its
content having regard to your particular investment objectives, financial situation or individual needs. You should
obtain a Product Disclosure Statement or other disclosure document relating to any financial product issued by
MLC Investments Limited (ABN 30 002 641 661 [include AFSL for PDSs/FSGs/Annual Reports]) and consider it
before making any decision about whether to acquire or continue to hold the product. A copy of the Product
Disclosure Statement or other disclosure document is available upon request by phoning the MLC call centre on
132 652 or on our website at mlc.com.au.
2
Table of Contents
Topic
Slides
MLC Horizon 3 Conservative Growth Portfolio
4
MLC Horizon 5 Growth Portfolio
7
MLC Horizon 6 Share Portfolio
10
MLC Australian Share Fund
13
MLC Global Share Fund
14
MLC Global Property Fund
15
MLC Property Securities Fund
16
MLC Diversified Debt Fund
17
MLC IncomeBuilderTM Fund
20
3
MLC Horizon 3 Conservative Growth
Portfolio – total returns
Historical Absolute Performance
MLC Wholesale Horizon 3 Conservative Growth Portfolio
(after taking into account fees)
15%
Return % p.a.
10%
5%
0%
-5%
• 5 year returns have always been positive
-10%
2002
2003
2004
2005
2006
1 Year Ended 30 June
Source: MLC Investment Management
2007
2008
2009
2010
2011
5 Years Ended 30 June
4
MLC Horizon 3 strategy– asset class
contribution
Contribution to Total Return by Asset Class
MLC Wholesale Horizon 3 Conservative Growth Portfolio
(before taking into account fees)
Return Contribution %
(annualised for periods greater than 1 year)
4
4
3
3
2
2
1
1
0
-1
-1
-2
Australian Shares
Global Shares Hedged
3 months to Jun-2011
Global Shares Unhedged
Global Property
Securities
1 year to Jun-2011
LTAR
3 years to Jun-2011
Debt Securities
5 years to Jun-2011
Source: MLC Investment Management
5
MLC Horizon 3 Conservative Growth
Portfolio – peer relative performance
MLC Wholesale Horizon 3 Conservative Gr Portfolio
Comparison with the Mercer Wholesale-Moderate Growth Universe
Performance before tax and after fees for periods ended June 2011
Rates of Return(%)
13
Q3
9
Q3
5
Q3
1
Q2
Q4
-3
3 Months (% )
MLC0398AU
95th Percentile
Upper Quartile
Median
Lower Quartile
5th Percentile
Number of Funds
-0.6 (14)
0.1
-0.3
-0.4
-0.5
-0.9
17
1 Year (% )
8.3
3 Years (% pa)
(9)
12.4
9.1
8.5
8.0
7.0
16
5 Years (% pa)
7 Years (% pa)
2.7 (10)
2.9
5.4
4.8
3.9
3.2
2.5
1.7
16
5.0
3.3
2.8
2.4
2.1
15
(7)
(7)
6.7
5.9
5.6
5.2
4.8
11
Data Source: Morningstar and Lipper, A Thomson Reuters Company
6
MLC Horizon 5 Growth Portfolio – total
returns
Historical Absolute Performance
MLC Wholesale Horizon 5 Growth Portfolio
(after taking into account fees)
20%
15%
Return % p.a.
10%
5%
0%
-5%
-10%
-15%
• 5 year returns have always been positive
-20%
1999
2000
2001
2002
2003
2004
1 Year Ended 30 June
2005
2006
2007
2008
2009
2010
2011
5 Years Ended 30 June
Source: MLC Investment Management
7
MLC Horizon 5 strategy– asset class
contribution
Contribution to Total Return by Asset Class
MLC Wholesale Horizon 5 Growth Portfolio
(before taking into account fees)
(annualised for periods greater than 1 year)
Return Contribution %
5
4
3
2
1
0
-1
-2
Australian Shares
Global Shares Hedged
3 months to Jun-2011
Global Shares Unhedged
Global Property
Securities
1 year to Jun-2011
LTAR
3 years to Jun-2011
Debt Securities
5 years to Jun-2011
Source: MLC Investment Management
8
MLC Horizon 5 Growth Portfolio – peer
relative performance
MLC Wholesale Horizon 5 Growth Portfolio
Comparison with the Mercer Wholesale-High Growth Universe
Performance before tax and after fees for periods ended June 2011
Rates of Return(%)
Q3
13
9
Q3
5
Q2
Q3
1
Q4
-3
3 Months (% )
MLC0265AU
95th Percentile
Upper Quartile
Median
Lower Quartile
5th Percentile
Number of Funds
-2.3 (15)
-1.3
-1.7
-2.1
-2.3
-2.4
20
1 Year (% )
3 Years (% pa)
9.8 (12)
12.6
10.7
10.2
9.1
8.4
19
0.0 (12)
1.7
0.8
0.3
-1.0
-1.5
19
5 Years (% pa)
7 Years (% pa)
0.6
4.8
2.7
1.2
0.6
0.2
-0.5
15
(8)
(6)
6.8
5.4
5.0
4.4
4.0
9
Data Source: Morningstar and Lipper, A Thomson Reuters Company
9
MLC Horizon 6 Share Portfolio – total
returns
Historical Absolute Performance
MLC Wholesale Horizon 6 Share Portfolio
(after taking into account fees)
30%
Return % p.a.
20%
10%
0%
-10%
-20%
-30%
2002
2003
2004
2005
2006
1 Year Ended 30 June
2007
2008
2009
2010
2011
5 Years Ended 30 June
Source: MLC Investment Management
10
MLC Horizon 6 strategy– asset class
contribution
Contribution to Total Return by Asset Class
MLC Wholesale Horizon 6 Share Portfolio
(before taking into account fees)
8
(annualised for periods greater than 1 year)
Return Contribution %
7
6
5
4
3
2
1
0
-1
-2
-3
Australian Shares
Global Shares - Hedged
3 months to Jun-2011
Global Shares - Unhedged
1 year to Jun-2011
3 years to Jun-2011
LTAR
5 years to Jun-2011
Source: MLC Investment Management
11
MLC Horizon 6 Share Portfolio – peer
relative performance
MLC Wholesale Horizon 6 Share Portfolio
Comparison with the Mercer Wholesale-All Growth Universe
Performance before tax and after fees for periods ended June 2011
Rates of Return(%)
Q2
13
8
Q2
Q2
3
Q3
Q2
-2
-7
3 Months (% )
1 Year (% )
MLC0397AU
-3.0
10.5
95th Percentile
Upper Quartile
Median
Lower Quartile
5th Percentile
Number of Funds
-0.6
-2.5
-3.0
-3.5
-4.2
18
(8)
3 Years (% pa)
(9)
12.6
12.1
10.2
7.9
5.3
18
-1.2 (13)
3.1
0.7
-0.3
-1.7
-3.0
18
5 Years (% pa)
7 Years (% pa)
0.0
4.7
2.8
0.2
-0.2
-0.7
-2.5
16
(6)
(4)
5.7
4.9
4.6
3.7
2.3
10
Data Source: Morningstar and Lipper, A Thomson Reuters Company
12
MLC Australian Share Fund – total returns
Historical Absolute Performance
MLC Wholesale Australian Share Fund
(after taking into account fees)
30%
25%
20%
Return % p.a.
15%
10%
5%
0%
-5%
-10%
-15%
• 5 year returns have always been positive
-20%
1999
2000
2001
2002
2003
2004
1 Year Ended 30 June
2005
2006
2007
2008
2009
2010
2011
5 Years Ended 30 June
Source: MLC Investment Management
13
MLC Global Share Fund – total returns
Historical Absolute Performance
MLC Wholesale Global Share Fund
(after taking into account fees)
25%
20%
15%
Return % p.a.
10%
5%
0%
-5%
-10%
-15%
-20%
-25%
1999
2000
2001
2002
2003
2004
1 Year Ended 30 June
2005
2006
2007
2008
2009
2010
2011
5 Years Ended 30 June
Source: MLC Investment Management
14
MLC Global Property Fund – total returns
Historical Absolute Performance
MLC Wholesale Global Property Fund
(after taking into account fees)
40%
30%
Return % p.a.
20%
10%
0%
-10%
-20%
-30%
-40%
2008
2009
2010
2011
1 Year Ended 30 June
Source: MLC Investment Management
15
MLC Property Securities Fund – total
returns
Historical Absolute Performance
MLC Wholesale Property Securities Fund
(after taking into account fees)
30%
20%
Return % p.a.
10%
0%
-10%
-20%
-30%
-40%
1999
2000
2001
2002
2003
2004
1 Year Ended 30 June
2005
2006
2007
2008
2009
2010
2011
5 Years Ended 30 June
Source: MLC Investment Management
16
MLC Diversified Debt Fund – total returns
Historical Absolute Performance
MLC Wholesale Diversified Debt Fund
(after taking into account fees)
12%
10%
Return % p.a.
8%
6%
4%
2%
0%
2009
2010
2011
1 Year Ended 30 June
Source: MLC Investment Management
17
MLC Diversified Debt Fund – asset class
contribution
Contribution to Total Return by Asset Class
MLC Wholesale Diversified Debt Fund
(before taking into account fees and tax)
3.0%
Return Contribution %
(annualised for periods greater than 1 year)
2.5%
2.0%
1.5%
1.0%
0.5%
0.0%
-0.5%
Australian Bonds
Global Government
Bonds
Global NonGovernment Bonds
Quarter to Jun-11
Global Multi-Sector
Bonds
Global High Yield
Bonds
1 Year to Jun-11
Global Bank Loans
Global Mortgages
3 years to Jun-11
Source: MLC Investment Management
18
MLC Diversified Debt Fund - manager
contribution
Manager Absolute Performance
Wholesale Diversified Debt Fund
(before taking into account fees)
Manager Performance %
(annualised for periods greater than 1 year)
20%
15%
10%
5%
0%
Antares (all- UBS (all- Goldman Wellington Rogge (allmaturities) maturities) Sachs (all-Managementmaturities)
maturities)
(allmaturities)
Amundi
Australian Australian Global Global Non-Global Non- Global
Bonds
Bonds GovernmentGovernmentGovernment MultiBonds
Bonds
Bonds
Sector
Bonds
Quarter to Jun-11
Franklin
Templeton
PIMCO
W. R. Huff
Global
MultiSector
Bonds
Global
MultiSector
Bonds
Global
Global
High Yield High Yield
Bonds
Bonds
1 Year to Jun-11
Oaktree
ShenkmanStone Tower
Capital
Global
Bank
Loans
Global
Mortgages
3 years to Jun-11
Source: MLC Investment Management
19
MLC IncomeBuilderTM Fund – distribution
performance
MLC IncomeBuilderTM Investment Trust (Wholesale) Distribution Analysis
18
16
14
3.97
12
3.96
3.78
Cents per unit
2.27
10
2.37
1.94
8
0.01
0.58
0.56
6
-
4
0.04
-
0.77
0.90
0.00
0.00
0.25
0.30
0.13
7.10
6.41
2
-
0.01
0.00
2.68
3.01
3.32
2.30
1999
2000
2001
2002
7.52
7.69
7.16
5.73
4.80
4.21
6.62
0.32
1998
2003
2004
2005
2006
2007
2008
2009
2010
2011
Financial Year End 30 June
Underlying Income
Taxable Capital Gains
Buybacks
Concessional (non-taxed) Capital Gains
Source: MLC Investment Management
20
MLC IncomeBuilder™ Fund - The dividend
environment is improving
Company
Latest year dividend declared (per
share)
Change on last years corresponding
div.
Commonwealth Bank
$3.02
28%
ANZ Banking Group
$1.26
24%
Westpac
$1.39
20%
Wesfarmers
$1.35
17%
Coca-Cola Amatil
$0.485
11%
Woolworths
$1.19
9%
National Australia Bank
$1.52
4%
Brambles
$0.255
2%
AMP
$0.30
0%
$0.2725
0%
Fosters Group
As at 30th June 2011
Source: MLC Investment Management
21
MLC IncomeBuilder ™ Fund – manager
contribution
Manager Performance in Excess of the Index
IncomeBuilder TM Strategy
(before taking into account fees and tax)
2.0%
(annualised for periods greater than 1 year)
Excess Return vs S&P/ASX 200 All Industrials Index
3.0%
1.0%
0.0%
-1.0%
-2.0%
-3.0%
-4.0%
Vanguard
Quarter to Jun-11
Maple-Brown Abbott
1 Year to Jun-11
3 years to Jun-11
IncomeBuilderTM
5 Years to Jun-11
Source: MLC Investment Management
22