PAC (ASX) News: PAC Pacific Current Group Pacific Current Invests Us$34.25M In Carlisle Management Company

Originally posted by lost ↑

Originally posted by Hot News
Press the arrow to access the original post.
Hi Everyone
Currently sunning it up in Bonbeach and was pleased to get the announcement this morning. Following are notes from Investor Call which covered IFP and Carlisle investments and the FUM announcement today:

Elaborated on IFP investment reasoning

proven business model

PAC investment will be used to improve technology platform - creating a leading broker platform for Investment Advisers

Real growth occurs once IFP moves to new tech platform - first quarter (some news articles have reported April 1)

Diversifies investments into Retail FUM/AUM market

Investment can grow from 10% to 25%

Long term contributor to bottom line

Carlisle investment reasoning:

Carlisle FUM returns have been on average of 20% over the last ten years (publicly available)

Fund economics, base fees on average are 1.75% and performance fees are charged at 20% for greater than an 8% return

Back of envelope calculations discussed in call are:

$US24 Million in management fees, roughly $US4 Million per annum to PAC from today

Performance share is forecast to be $US2 Million, however if fund performs the same as this year then we are looking at up to $US7 Million

What is Carlisle's competitive advantage?

Excel at finding good deals

Above average returns

Efficient process of assessment (high complex rules associated with purchasing Life Policies). Carlisle know these very well.

Carlisle outsource policy risk analysis (assume this is health assessment)

Why is Carlisle partnering with PAC?

Note, PAC weren't the highest bidder

PAC investment aligned philosophically with Carlisle management team

Enables distribution expansion into the Australian Market

Who are Carlisle's investors? Currently majority high net worth investors, increasingly Institutional investors (some made up of Sovereign Wealth funds)

Carlisle's average policy purchased is from an 80 to 82 year old with a life expectancy of approximately 7 years in the US. They are purchased through a network of brokers that is critical to Carlisle's success. Life Insurance policies are used to avoid death taxes in the US (I have summarised) and recent Trump tax changes encourage elderly holders of policies to cash in prior to death, tax thresholds have been increased. Cash from policy sale will not be impacted by death tax.

Carlisle market share is high, they are number two in the market. Policies for sale are likely to increase over the next few years due to tax changes.

New growth in FUM for Carlisle is estimated to be north of $US1 Billion in two years (likely to double contribution from $US6-$US7 Million to $US12 - $US14 Million - but be careful of extrapolation and future fund performance)

Carlisle regulation is low as the Life Insurance Admin/Brokers are regulated to ensure they sell policies aligned with client requirements.

There was a question around Revenue Management approach versus earnings approach. Didn't quite get the answer, if someone wants to fill in the blank here please do so. The valuation approach was driven by Carlisle Management.

Further IFP information:

Currently has $US40 Billion in AUM (not FUM) where IFP will have a competitive advantage due to improved technology platform

PAC is looking for synergies with current boutiques owned and to utilise the new platform

Comments on FUM:

PAC board very pleased to see an increase of 4.1% in the last quarter where the overall market was sharply down

Reinforces stability of investment strategy, proving good mix of boutiques in Closed and Open end funds

Good FUM growth from ROC, GQG and Victory Park offsetting smaller boutique FUM decreases

Last but the greatest point, $A35-$A40 Million resides in cash and the board is yet to make a decision on whether an interim dividend will be paid

In summary, this with Victory Park Capital will more than cover loss in earnings from Investors Mutual, RARE, Aperio and PAC board has a lot of spare capital to make further acquisitions increasing revenue and earnings in the future. Possible interim dividend is a high probability given the continuing uplift in income generated.

Anyone else who attended, feel free to correct any of the above.

Best of Luck
Lost

Expand

Thanks Lost
Missed the notice of an investors call, so your detailed summary is much appreciated.

No.	Vol.	Price($)
1	500	$10.51

No.

Vol.

Price($)

500

$10.51

Price($)	Vol.	No.
$10.80	5606	3

Price($)

Vol.

No.

$10.80

5606

No.	Vol.	Price($)
1	500	10.510
2	12706	10.500
1	1000	10.310
2	1650	10.200
5	1450	10.100

No.

Vol.

Price($)

500

10.510

12706

10.500

1000

10.310

1650

10.200

1450

10.100

Price($)	Vol.	No.
10.800	4275	2
10.950	5	1
10.980	25996	1
10.990	284	1
11.000	10200	2

Price($)

Vol.

No.

10.800

4275

10.950

10.980

25996

10.990

284

11.000

10200

(20min delay)
Last $10.80		Change 0.310(2.96%)		Mkt cap ! $563.7M

Open	High	Low	Value	Volume
$10.67	$10.80	$10.44	$765.2K	71.58K

News: PAC Pacific Current Group Pacific Current Invests Us$34.25M In Carlisle Management Company, page-3

Lake Resources implies news article on job cuts made up; non-core sales "not material" and no rule 15.7 breach

Metalicity looking for offers on Admiral Bay zinc project

Imricor raises $35M to pursue growth and expansion into Australia and NZ

Flynn Gold flags mid-grade drill hits and always eye-catching rock chips

Wealth Within considers potential takeover targets in Australia's booming infrastructure industry

Talking Australia's very competitive property landscape: Realty Talks

Week 29 Wrap: Trump in spotlight again; China's Third Plenum a yawnfest; RBA's August move a mystery

AI stocks: What to expect in 2024-25

NSW approves J-POWER's $380M buyout of Genex Power, giving it ownership of QLD net zero project

Warren Tredrea’s weekly sports business wrap: the latest on business in sport

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News

News: PAC Pacific Current Group Pacific Current Invests Us$34.25M In Carlisle Management Company, page-3

Top Stories

Lake Resources implies news article on job cuts made up; non-core sales "not material" and no rule 15.7 breach

Metalicity looking for offers on Admiral Bay zinc project

Imricor raises $35M to pursue growth and expansion into Australia and NZ

Flynn Gold flags mid-grade drill hits and always eye-catching rock chips

Wealth Within considers potential takeover targets in Australia's booming infrastructure industry

Talking Australia's very competitive property landscape: Realty Talks

Week 29 Wrap: Trump in spotlight again; China's Third Plenum a yawnfest; RBA's August move a mystery

AI stocks: What to expect in 2024-25

NSW approves J-POWER's $380M buyout of Genex Power, giving it ownership of QLD net zero project

Warren Tredrea’s weekly sports business wrap: the latest on business in sport

Featured News

Buyers (Bids)

Sellers (Offers)

Featured News