Earnings Call: H2 2022

Jun 30, 2022

Good afternoon and welcome to the Liontrust Asset Management PLC final results investor presentation. Throughout this recorded presentation, investors will be in listen only mode. Questions are encouraged and can be sent at any time by the Q&A tab situated in the right corner of your screen. Just simply type in your questions and press send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company will review all questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you to Simon Hildrey, Chief Marketing Officer, Vinay Abrol, CFO, and John Ions, CEO. Good afternoon to you. Good afternoon. Good afternoon. Good afternoon. My name is John Ions. I am Chief Executive of Liontrust and have been so for the last 13 years. I would like to thank you all for giving us this time to present to you on the opportunity set for Liontrust. This is obviously on the back of our financial results, which Vinay will go through in a moment. I would probably just like to start by an introduction to Liontrust. By no intention of talking to the points on those slides, but you can see where the business is now. When I joined around 13 years ago, the business was GBP 1 billion of assets under management and has now grown, as you can see, successfully to GBP 33.5 billion of assets under management. The strategy has been one of, and I suppose my experience is over the last 35 years in fund management. The opportunity set when I started in Liontrust was to look at what is good about that business and what can we do with this industry. If we look at the whole savings industry, in general, and you look at the move from defined benefit to defined contribution, what is the key factor that has come out of that? Defined benefit, final salary schemes were always linked to your length of service, and your contributions into the product. The shift to defined contribution and the moves that were made along that time were that the individual took ownership of their investments. From my point of view, that was the most important point. This is an industry that has grown up on telling people what they need to invest in, how they need to invest for the future, and what they should do. I think what we have seen over the last 10 or 15 years, and certainly in the development over the last five years and through the pandemic, is the individual taking control of their own savings. After all, that is why you are all on this call. What we have tried to do, or what we have done, is put the client very much at the center of what we do. We explain the process of how we manage money. If you look down, you will see that we do not have a Chief Investment Officer at Liontrust. Why do we not have that? If you look at the big investment houses, where you look at compliance, you look at risk, and you have a Chief Investment Officer, in fact, some have several Chief Investment Officers. You are looking at how do we mitigate risk, and therefore, how do we stifle the individual's ability to manage money. On the other side, what you do not want as an investor is you do not want a fund manager to be able to play, for better or worse, fast and loose on what they are doing with long-term savings. These are savings that we are the guardian of, that have taken people 30, 40 years to accumulate. What we look at in Liontrust is how do we attract the best talent? How do we create an environment for them to run money the way that they want to run that money? It is very much about process. We will create that environment where all you do is focus on that process. Not only do we internally, we use external people to coach on the fund management side to say, no fund manager gets every decision right, but how do we improve the probability that the next decision we make has more chance of being right than anything else? If you think about it, if you look at the professional athletes or in sport, fund management is no different. You need to be able to create the framework by which people can be consistent in those outcomes. So that's what we do. That's why it enables us to attract people. We have seven teams across that, so by no means do we mean to have the answers for all investment strategies, but the areas where we think we can add value as active fund managers are the areas that we'll focus on. The other side of that equation is if you do that, we provide a route to market, for what you do and in terms of communication and delivery and understanding. Those are all areas in an industry that often uses jargon to make it very opaque, lacks transparency. If you think about it, there are hardly many industries where everybody of a working age in the U.K. has a pension. If you look at that relative to any other industry, the level of trust within the industry is very poor. So what we're looking to do is explain to people what we're doing. The present climate is no exception to that, where you've got an awful lot of short-term noise going around and volatility, uncertainty about the future. The one thing that you want out of your investment team is not to be chasing short-term gains. You need people to be looking at all the companies that we invest in, are we investing in them for the same reasons that we invested in them last year? If I look at markets now, and we look at falls, are those companies half as good as they were a year ago? Or were they twice as good a year ago? So to have that anchor, to have that focus, and to have that confidence in being able to manage money. We're managing money for people's long-term savings. People's savings are 5, 10, 20 years out. What you don't want is people taking short-term decisions because they think something looks cheap on a short-term basis. So with the fund management side, that's key to us. With the distribution side, being able to communicate on process and to sell on that and to engage with our client base as to how we go forward, those are the two base tenets of that business. If we get that right and we're disciplined in the way that we run the business, the results will come through. If we go through, if you look at the rise of the business there, that is very much. I often think when I talk to shareholders, I do shareholder presentations, it would be much easier to say, if I was at Apple, I would have a new innovation, I would have a new product coming out on a regular basis. What do we do? We do the same in 2011 as we do today. How do we get the edge? How have we grown to be a group that in terms of inflows, was second in the industry last year in terms of net flows, is regularly in the top 10 in terms of gross flows. There is no secret sauce. There is nothing magic to that. It is very much about if we do the day job, day in, day out, that will give us the advantage, because that in itself is quite hard to do. That is why process fits through what we do on fund management, what we do on sales, what we do on marketing. The strategy for growth has always been based on a three-pronged approach. Organic growth is what Vinnie and I, and our management team focus on a day-to-day basis. That is what we can affect on that day-to-day basis. The other two areas are talent hire or acquisitions. Talent hire is where we would bring in a new team, a new fund management discipline or skill set. The issue you always have with that is that it takes three years to get a three-year track record, or you have to get a critical mass in that asset class to start with, to engage with your larger clients. So that brings in the third opportunity, which is acquisitions. If we look at acquisitions, buying assets just to fill up silos is not a very profitable way to run your business. The financial services industry is littered with examples of people who have bought businesses on the basis of, if I take GBP 100 million of costs out, I put a 10 multiple on it, I have created a million pounds worth of market value. That in the short term may work. The problem with that is if you have not got a product that is focused and delivers to the end investor what they require, you will just see the slow attrition of assets over the next two, three, or five years. What we try to do through our acquisition policy, through Majedie, the more recent one, Architas, Neptune, and back five years to Alliance Trust, is to say, "What are we looking for with this business? How can we grow it?" We are looking to grow it by either adding to our manufacturing, our investment management skill set or our distribution skill set. If I can do that, if I can use acquisitions to give me a distribution or a manufacturing benefit, it fast-forwards that grow your own development. If I look down the line, you see with Alliance Trust, that was a business that we bought in April 2017. It was a business that was probably two years in the making of discussions with me and our previous Chief Executive as we could go there. It was an area that we had wanted to invest in on the sustainable side. It is an area where the brand awareness now of Liontrust is, in the retail market, the strongest in sustainable. It has been responsible for strong inflows into the business. When we bought them at GBP 2.5 billion, and they have moved forward to GBP 30.2 billion. When we bought them, they had a 16-year very successful track record. That's continued over the next 5 years. Apart from, in the short term, where performance looks weaker because of the exclusion of it, sort of energy or carbon emitting stocks in their portfolios, at a time where you've got, I would say unprecedented, but it's not necessarily unprecedented, but terrible events in the Ukraine and the squeeze on energy prices, you're going to look weaker when there's a short-term scramble for demand. On the other side of that, if you look at sources of alternative energy and moving forward, there's probably been no more one event that has focused people's attention on that. The lack of opportunity to provide short-term replacements does not take away the opportunity set of where the direction of travel is. I think that's back to having strength in your convictions, the investment process, and the focus on that, and to be able to create an environment where fund managers are not being affected by short-term noise or headlines. From there, with Neptune, that was a deal that broadened out our manufacturing base, gave us much more global product, and where areas of demand and client base. Architas was a business we bought from AXA, the French insurance company. It bolstered out our multi-asset offering. It also bolstered out the level of service we could provide to the intermediary market in the U.K., where they are increasingly, from a regulatory point of view, moving away from managing assets themselves to looking at risk-rated portfolios that they could provide to clients and the support they could get from that. More recently, the Majedie acquisition was one of Liontrust's core business, and the strength has been to build a very strong and successful brand in retail in the U.K. We've been, for years, awarded Fund Manager of the Year in that retail space through Investment Week. What we looked at was, how do we develop the business into other distribution opportunities? In my role, there are no lack of opportunities to grow the business. What I have to look at and to balance is, where are we capable of going, and how do we do that? After the people in the business, the most important asset we have is time. How do I allocate that time across the different resources inside of the business and the different routes to market, want of a better word. Because obviously, I have the opportunity cost of where do I take that resource away from. To be able to enhance the distribution that with a small institutional business, it had recently won the local authority, amalgamated local authority pension funds. With the acquisition of Majedie, that brought to us an awful lot more of the plumbing for, in terms of how you get out to not only the consultants, but an existing client book of business. That, to me, rounded off or enhanced what we had there and set a very good foundation and platform to go forward from. Acquisitions get headlines, but they've got to be to a strategic benefit to the business. Size is not the result. You've got to come out the other side of that with something that is useful and provides you with focus. If I move on to slide 9. I suppose this is one of the benefits, but also the distractions of the moves that we've all made to teams on digital presentations. A financial services industry that has found it very difficult to engage with a very broad base of clients, has been, I suppose, moved forward rapidly in the last 2 or 3 years. Predominantly forced by the pandemic and our ability to do that. Believe you me, to talk to a screen and not to be able to get recognition back from the client base, is a much harder thing to do. If we go through, I will take it as read 9 and 10, because you're much better at reading things than I am pointing things out. If I look at where our business sits now in terms of our assets, we've a very strong brand in sustainable. Probably number one brand there in the retail marketplace. A very key and core part of our business, and I think in that broader responsible capitalism, is how do we move forward. If I go back through my career 10 years ago, well, maybe even only 5 years ago, the questions on sustainability were all at the back of any client meeting. They're now the first questions that you get. It is an area where there is a lot of noise. Data sets are inconsistent, levels of knowledge are poor, but they will improve rapidly over the next 3 or 5 years. I think if you ask any client, and this is very much part of that transition from defined benefit to defined contribution. If you ask any client how they would like their money or would they like their money invested in a more responsible, sustainable way, the answer is going to be yes. That's definitely what we found. I think now with a lot of noise that you get it from HSBC making comments in Miami to which are being raised in Germany, the regulator, the FCA in the U.K. yesterday saying, everything needs to be more evidence-based. For me, that is perfect because the most overused phrase probably in the industry now is this is embedded, and if it becomes evidence-based, you're going to have to be able to demonstrate that and to show it. If I talk to our institutional clients, they're saying they want to allocate money. They're being driven to allocate money, but there are a lack of appropriate products to be able to do that. I think if you can demonstrate and not just pay lip service, it's a huge growth area, for the marketplace. The other product set there is we have a very strong franchise under Economic Advantage. In excess of 20 years of great U.K. equity, across mid, small, large, and micro-cap funds, an enviable track record there. That is an area where, if I'd said to you 3 years ago people have their lowest U.K. equity weightings, I'd have been wrong. People have continued to do that. What we find there is that the sale on process, the ability of our clients to understand where we're looking and what we're investing in that quality growth sector of the marketplace, it is about providing products that are the most suitable for them or what they want in that space. And I suppose it's a little strength at the moment, but having done a few client meetings over the last month, when I talk to people about what's going on, a lot of them turn around and say, "You're the least of our problems in that place." That's not a strength, but what they know is what they bought us for. What they know is what we'll adhere to and stick to. And that fills the requirement within portfolios for clients. So, that is very much the badge of Liontrust in terms of we will stick to what we know we're good at. We won't deviate away from that. In the short term, that may look performance-wise weaker. But in the long term, as our results show, that's what we know is right. If I go back through my career, this is not too dissimilar to 2001, to where it was called the dash to trash at that stage. Now, it's not to say that market sentiment is the same now, but to throw the baby out with the bath water and to move forward is not what you want your fund managers doing. So, there's a lot of importance from my point of view on giving the fund managers the confidence and the freedom to stick to what they're doing and the support whilst running all the checks and balances across that. Slides 13, 14, and 15, say where we are with things as to the next ones you're capable or more than capable of running that. So if I hand over to Vinay now at the start of 19. Hi there. Okay. Thanks everyone for joining us for this presentation. So I'll maybe spend just a few minutes going through our financial results and our highlights. The strap line there show you that we're demonstrating a profitable and growing business. And maybe I'll come back to that in a moment actually, because there's another slide that shows how we've done over the years. But what you can see here are the key metrics for our financial year just ended at the end of March. So, we've grown our gross profit or revenues in sort of old language, up 41%. And that includes performance fees. If you take performance fees out, we've grown the underlying revenue of the business by 46% over the course of the year, where our average AUM is up 43%. So we've shown that we've been able to grow our revenues faster than we've grown our average AUM over that period. That's translated into an adjusted profit. And we use adjusted profit to give you an indication of the underlying profitability of the business, stripping out some of the charges that have related to acquisitions, which vary year on year. The adjusted profit was up 64% at GBP 96.6 million. So again, up 64%. I think what that shows you, it shows you that in a well-run business, you should be able to grow your profits faster than your revenues. And that's what we've been able to do. Our EPS, our adjusted diluted EPS, that shows you on a per share basis the profitability after tax, again, up 59%. So slightly less than the adjusted profit number, but that reflects the number of shares that are in issue. That financial performance has resulted in us being able to increase our dividend by 53%. So, GBP 0.72, we have just gone ex-dividend GBP 0.50, second interim dividend today. Today. Yeah. Yeah. So what you see there, you see a business that is performing well. We are growing our revenues, we are growing our profits faster than our revenues. Our costs, you will see on the next page, other costs, other admin costs to run the business are up 26%. So we have got good cost controls, and that financial performance has translated into an increased dividend. So shareholders are benefiting for a substantial increase in our dividend for the full year. The next slide just shows you some of those numbers, again, in a bit more detail on the metrics. Another key metric I would just like to highlight, adjusted operating margin. Now, operating margin is how much of your revenue is coming to the bottom line in profit. So it is a good way for investors to look at a business and see what is dropping down to the bottom line. You have seen with us a progressive increase in our adjusted operating margins. So it shows you that our business, as we grow, is running more efficiently. It is one of those things, sometimes people talk about operating leverage. So, the more revenues you have, the more profit you should make, because you should not need to increase your cost in line with your revenues. That is definitely the case with Liontrust, and there is another slide that will show you that in a bit more detail. Another really important metric on this slide, our average revenue margin. So are we getting this extra revenue by slashing our prices to get extra assets on board, more revenue, but we are actually sort of killing ourselves on our revenue margin. So you can see here, last year, our revenue margin was 0.62%, 62 basis points. That is effectively, how much of the funds we manage, what are we earning in revenues? Last year, just gone, it was slightly higher at 63%. It shows you again that we are increasing our AUM, but we are not cutting prices. We are being able to maintain our management fee on the products that we run. Some of this is mix-related. We have products across a wide range of areas. John touched on the various investment teams earlier, and each of them have different margin rates. Sometimes that affects that. But it shows that we are able to maintain our margin in what is actually a very, very tough business for fees. The next slide, unfortunately, is a lot of numbers. It is quite an important slide, actually. It shows you the progress of Liontrust. At the top, we are highlighting the acquisitions that we have done over the years. It comes back to that strap line on the previous slide, where we can demonstrate here that we are a profitable business that is growing consistently. This goes back to 2013, so nearly 10 years. You have seen that we have grown our AUM, assets under management, or future revenues, from GBP 3 billion in 2013 to GBP 33.5 billion at the end of the last financial year, which became GBP 38.7 billion with the Majedie acquisition. So you have seen consistent AUM growth over that period of time. You can also see that is translated into consistent growth in revenues. The revenues sometimes is out of kilter with the AUM growth because of the way the averages work. But you can see that with the AUM, we have delivered revenue growth, and in turn, that revenue growth has delivered growth in profits. So we have been able to translate that revenue growth into profit into dividends. You can see, it is only nine years ago that our dividend was one pence a share, and we have just paid out 72 pence a share. So you are seeing that our shareholders have benefited from that growth in AUM, revenues, and profit. Operating margin. I touched on operating margin before. Again, you can see that consistent growth in operating margin. We are operating now as we have grown into the GBP 30 billion level, and profits close to GBP 100 million. We have grown into an operating margin of just over 40%. So, I will maybe go onto the next slide. I think the next slide, we have got some key metrics in AUM. Maybe I will just John has covered most of these points on the team side of things. The interesting slide here, the chart on the left shows you Liontrust is predominantly a U.K. retail business. So if you take the U.K. retail line of 64% and the multi-asset at 71%, over 80% of our business is effectively sourced through the U.K. retail channel. But we have a substantial amount of AUM in institutional just under GBP 5 billion. That is been boosted by the Majedie acquisition and a small amount that is under just around 6% in international assets, which are managed out of London but are sold into Europe. Client type, again, very much influenced by our focus on U.K. retail. Again, the majority of our client base is through that intermediary wealth management space. That chart is excluding Majedie. When we have Majedie on board that will take us into a more institutional type basis. I think John's already gone through the teams actually, so I won't dwell on that. Then you've got another slide here which just shows you, drills down into Liontrust as a business, where is the AUM that we manage. Five years ago, our business was all 100% U.K. assets, 100% equities. You see what we've done through the acquisitions that John's talked about earlier. We've built a much more diverse fund management business. We now have 60% of our AUM in the U.K., a substantial amount in America, Asia and Europe. We have 74% of our AUM in equities. So again, we're not only much more diversified by region, but also much more diversified across asset classes. What you're getting with Liontrust is actually a more diverse business than it was five years ago. That is a key strategic aim for us to have more diversification in our business. The next slide just shows you, again, our AUM in a tree burst type approach. What it shows you is that, especially in our funds, multi-asset is a group of funds actually. We have a broad range of funds. Our largest fund is a Special Situations Fund, which is just around that GBP 5 billion mark. But if you look at sustainable investing, a broad range of large funds. So it shows, again, that point that we are a diversified asset manager. Maybe we'll finish the presentation just with just a little bit on outlook. Pick up on those points that none of them will be new to anybody who's looking to invest in the sector. We have a savings crisis before people now have an ability or people have taken a chip from DC, people have taken ownership. Sustainability is a big part of that next generation of investors, but generally from our own research and feedback, we know that if I talk to you about the shape of the yield curve, most people will switch off. If I talk to you about a transition for cleaner, greener energy, decarbonization, social inequality, I find a medium by which I can invest with this much broader base of investors now. Something that people are passionate about and care about. I think for an industry that historically has done itself no favors by making itself impenetrable, I've referred to it in the past, I am Catholic, so it is a bit like Catholicism, where you use Latin to become highbrow. You've got to find a language that which you can build trust with. Trust is not great across the industry. So to be able to explain to clients what's going on, and where they are is massively important. The M&A side is the bit that everybody focuses on. There were several questions that I could see popping up in the chat side there. This is an industry that hasn't executed M&A particularly well. But if you put two businesses together to take costs out of them, and you put a multiple on that makes the business look fine. That's all very well and good, but if you come out of there without any focus or strength or a stronger proposition, it doesn't work. I think where we've been different or where we've maybe not even different, but what we try to focus on is what are we buying, what do we want to achieve. In any acquisition, day one, we have already made the decisions that we want to make about the structure of that business and the way it's going to go forward. They may not be right, but in business you get the three types of decision, good decision, bad decision, neither of which will one obviously is great, one won't kill you. Indecision is the one that generally does. You've got to have a clear focus of what you want to do, where you want to be. Even if you've made a bad decision, you've got to be able to address that and look at how do we improve it going forward. That helps you get that focus going forward. There are several opportunities around the market now, but if I look at them from Liontrust's point of view and I look at them over the 13 years that I've been here, what's the difference? The bar is definitely higher now. Years ago, you can only execute the deals that you're capable of being able to execute. Fortuitously now may be in a position where, we've got backing our own strength and demonstrated from our track record to be able to do things. Just because you can execute something is not the reason for doing it. The things that add value are the organic growth and the focus of the business. Acquisitions should be used purely to take you into new sets of new markets and to move forward. Then you've got to balance the resources of the business against that as to do it. Whilst acquisitions will grab headlines, they may not always grab you the best results. I think, where we are now, broadening out our distribution capability, the move more towards institutional will allow us to broaden out our product suite. More longer-term, limited liquidity product that may not sit well in a retail marketplace would sit well in the institutional side. That will help us with, aid us with our development there. I think, very much as we went into the pandemic, I said internally at the time to shareholders, where markets go, where flows are, I can't affect. What I can affect is when we come out of it, on the other side, do we have a stronger market share? The ethos here is very much about doing the day job day in, day out as best we can. That's what we can control, and that's what we know will give us a competitive advantage because we maintain the highest standards inside our own business. We know that will take us forward. I think on that point- Back to investor meeting. We will take questions. John, thank you very much for your presentation. Ladies and gentlemen, please do continue to submit your questions just using the Q&A tab situated on the top right of your screen. Just while the company take a few moments to review those questions submitted today, I would like to remind you that a recording of this presentation, along with a copy of the slides and the published Q&A, can be accessed via your investor dashboard. As you can see, we have received a number of questions throughout today's presentation, and thank you to all the investors for submitting those. Simon, could I just ask you to read out the questions to the team and where it is appropriate to do so, and then I will pick up from you at the end. Yeah. Thank you very much, and thank you to everyone for submitting your questions. There are two or three that kind of pick up on your last points, John. Maybe just on that acquisitions. Do you expect further consolidation, and how competitive is that acquisition in the industry? People have talked about consolidation for best part of 30 years. It does happen. Things happen. It happens either at the top, where it becomes a size. If I go back 10, 15 years, you could argue that the larger you got, the more able you were to offer a lower cost solution. So if you're running $25 billion, $50 billion in a market strategy, could you cut my lunch and offer that service cheaper? Now, we've always been very firm on price. We've probably turned more money or a similar amount of money away where people have said, "We'd like to give you a lot of money, but we would like it at a cheaper price." Now, your ability to outperform is a function of capacity in that marketplace and to be able to deploy those assets and take advantage of that. The problem you get when you get bigger and bigger is that your ability to take advantage of that, from a regulatory or compliance point of view, you're drawn more and more back towards the index. If you're wanting to be an active manager, but you're drawn more towards the index, over the last 10 years with the index providers coming out who are running money for four, five, six basis points, they cut your lunch. So we very much focus on the areas that we can add value. We stand or fall on our ability to be able to add value to client portfolios going forward. So acquisitions just to bolster size don't really work or certainly don't enable you to grow your business going forward. Acquisitions for skill sets are different, and I think we will continue to look at that. We're fortunate that we see pretty much every deal that comes across in New Zealand where people will approach us to say, "Would you be interested?" But that doesn't necessarily mean, "What do you think about that?" It's only in the areas where we see that. Otherwise, you end up It's like two drunks at the bar propping themselves up. It doesn't work, and there are plenty examples over the last three or four years of that. Just on the institutional market, you talked about, obviously, with the Majedie acquisition. As a geographic split, is that different for the institutional market? Is it more global? It is in a way, Majedie have a global presence, but definitely more known for their U.K. equity. Recently, they won one of the oldest and largest investment trusts in Edinburgh Investment Trust. Since they took that on board just over 2 years ago, everybody's very strong returns there. Also, if I go back to the sustainability or in its broader sense, the responsible capitalism theme. I think, to be able to demonstrate that in the institutional marketplace is definitely a position of strength. If I talk to the consultants or I talk to institutions, local authorities. We've just been one of the managers appointed to one of the local authority, sustainable mandates, and they've been awarded FPS. The fund itself is about GBP 1 billion, we're one of the managers there. The feedback is very much, we're looking for sustainable solutions. Around the world, we've got sovereigns, governments dictating that they would like more money invested in that way. One of the barriers is, people are looking and say, "Well, there's a lack of appropriate or accessible product or managers doing that." It's not about paying lip service, it's about being able to demonstrate what you're doing and to prove that. So I think going forward, that's a great area of potential competitive advantage for us. Does it diversify client base internationally as well? The institutional, could that potentially grow up? Yeah. The opportunity set is to grow. I was at Paris yesterday talking to a European institution about what do they want, what do they need. This is a group that we have a distribution agreement in place with. Sustainability is top of their list. Understanding process, that regulatory side. Not surprisingly, they are very much focused on how do you evidence what you're doing on the sustainable side, the regulatory risk for them and for institutions and pensions in that space is large. So, it broadens out. Again, back to the point I made a couple of times. It's not the shortage of opportunities, it's focusing on the opportunities you can get the best outcomes out of. Sometimes walking away from something because you haven't got the bandwidth or the time to invest in it, until you do, is a better outcome for the rest of the business. Finn, somebody's asked about, obviously, the fall in the shares. Would we consider buying our own shares? Yeah. The board does regularly consider where the share price and share buyback, possibly buy back shares. We take out authority every year that allows us to buy up to 10% of our shares back. So we've got that ability to do so, and we've got the permission to do so. But we have been conscious. We are a midcap now, we're at smaller end of the midcap size, we're wary of sucking liquidity out of the market. So, although it's been considered, we felt actually, the increase in the dividend is a great way to return cash to shareholders. But it is something the board does keep on the regular review. We do look at it, but we want to get more investors. To get more investors, you need liquidity. If you look at us relative to other financial stocks of the same size, there's probably more volume or trading and ability in that. If we take liquidity out, one of the questions you could ask is, how easy is it for me to buy X, but also how easy is it for me to sell X if I held X? As investors, liquidity plays an important part in your decision. So for us to take liquidity out of the market with the size we are, I don't think it's appropriate. Also, surely, rather than just buying and selling shares through treasury, I should be spending my time trying to work out how we grow the business going forward. There is a question about the AUM going up since the end of the financial year. Oh, sure. Do you want to explain that very quickly? Yeah. Our 31st of March number was GBP 33.5 billion. We announced with our results, 17th of June, a year was GBP 34.2. What we did, and the market has come down significantly since then. It is not inflow related, it is just that we completed the Majedie acquisition on the 1st of April. Majedie took our AUM actually to GBP 38.7 billion. What you have seen over that two and a half month period is the AUM not increasing from GBP 33.5 to GBP 34.2, but decreased from GBP 38.7 to GBP 34.2, which is mostly driven by the markets. And final question. We have been asked if we would ever cap the size of our funds for performance reasons. A question I get asked quite a lot. We continually monitor funds and certainly the smaller ones. So really, we are only talking about your funds where you have got a very good strong track record in small cap, where obviously there is a limited liquidity ability. I explained earlier that if you have got very large funds, how do you deviate away from the index? How do you add value? How do you add alpha? So we do that, and of course, the other side of that is that do you soft close, do you hard close funds to prevent investors going in and out of it. If you soft close a fund, all you are doing is preventing anybody who has not bought it, buying it in the future. So that does not really change anything because your existing investors could continue to buy it. If you hard close it, and you have a client for whatever reason, decides they want to move money away or reallocate to another area, you are then left with going back to client and saying, "You know the fund that you wanted to buy that I would not let you buy before, but now you can," is not really a good sort of sales or customer service message. So what we look at is a size of those funds, and we like to think the position we have got with the strength of the brand and the distribution is we know our clients very well. So if we think a fund is at that point, we would explain to clients that we do not think that is there. There is yet an advantage of that. If we have done that from a regulatory point of view, it would be very difficult for the individual or the company to buy it. But I do not think it is a kind of black and white thing where it is. Ultimately, at the end of the day, if we thought it was going to be detrimental and we could not control it, yes, we would look at a vehicle like that. We spend a lot of time building relationships with clients. We would like to think that because of the way we sell on process and communication, we have contact with our clients, and it is not just because the funds are great performers and people buy them, and we have no control over it. Okay. Thank you very much. John, Vinay, Simon, thank you very much for updating investors today. Thank you. Could I please ask investors not to close the session, as you will now be automatically redirected to provide your feedback in order that the management team can best understand your views and expectations. This will only take a few minutes to complete and I am sure will be greatly valued by the company. On behalf of the management team of Liontrust Asset Management PLC, we would like to thank you for attending today's presentation and good afternoon to you all. Thank you very much. Thanks a lot. Thank you. Thanks everyone. Bye.