St. James's Place plc (LON:STJ)

CMD 2021

← View all transcripts

May 26, 2021

Afternoon, welcome to the St. James's Place Capital Markets Day. This is the first time we have hosted one of these events virtually, and all the presentations have been pre-recorded. We will host a live Q&A at 5:00 P.M. Now, it's a shame that we aren't able to gather together in person for this session, although we do have a good afternoon planned for you. From my perspective, it's a great opportunity for us to build on some of what we outlined at our full year results presentation in February. We aim to achieve by 2025. You'll hear from four of my executive colleagues who will share insight into areas of activity that will be important to our success over that time. Before introducing the main session for today, you would've seen that we provided a short trading update this morning. We were pleased to report that the high levels of new business activities we experienced in the first quarter of the year have continued into April and May. Whilst this remains a tricky year, it will be another good year for St. James's Place. Let's move on. I will start by covering our strategy and business model, which will also encompass our purpose and values. As we look ahead, our objective is to support the U.K.'s leading group of financial advisors with the best technology clients' financial futures. By making sure our decision-making is centered around this long-term aspiration, we have continued to be successful as we have grown, and this will remain our focus in the years ahead to 2025 and beyond. Looking after these fundamentals will also help underpin the explicit goals through our planning cycle to 2025 that we set out alongside our full year results back in February. Hopefully, these will be familiar to you already. I want to repeat three key headlines. First, that we will deliver 10% per annum growth in new business. Second, that by maintaining our record of strong retention of client investments together with modest stock market growth, we aim to achieve funds under management of GBP 200 billion. Third, that we will aim to limit growth in our controllable expense base to 5% per annum. We are therefore striving to achieve continued growth in our business, but we've also made a firm commitment that we can do so efficiently, limiting our growth in our expense base. Achieving these aims will drive significant growth in the cash results and therefore cash returns to shareholders in line with the dividend guidance we have given. With the scale of our business today, market leading position, and our proven track record, St. James's Place is a business where the foundations of success are built on the strength of long-term relationships. We work hard to deliver for clients and advisors, and this is the key to great client and advisor retention, which then translates has helped develop a small life insurance business in 1992 into GBP 135 billion wealth management business today with a market capitalization of over GBP 7 billion. Long-term relationships mean we benefit from both long-term industry and SJP experience across our community. That's across the partnership, the executive, and our employees. This gives us deep market knowledge. We also benefit from a rich blend of new talent and joiners to the organization who bring fresh perspective and challenge to the business. You'll see this long-term approach reflected in much of what you hear today, whether about the partnership, our IMA, or how we are investing in technology. You'll also see it in our approach to developing our business market for a long-term wealth management business. What sets St. James's Place apart is our distinct business model. The original business plan back in 1991 was known internally as Utopia Life, and many of the founding principles remain true today. I want to focus on three of these which have and continue to provide significant competitive advantage. One, a long-term mindset. Two, a strong developing long-term deep relationships. That's long-term relationships with our advisors and in turn with their clients, long-term relationships with our employees, and long-term relationships with our key suppliers. We would have a strong distribution achieved through the partnership. Partners are self-employed business owners who exclusively offer our products and services. This was at a time when most life and asset management companies were closing down their distribution channels, and therefore, the partnership was a clear differentiator. Today, the partnership is a collection of over 2,500 SMEs distributed principally throughout the U.K. with over 4,300 highly trained and experienced advisors, assisted by 5,000 support staff within those businesses. The partnership is managing trusted face-to-face relationships with some 830,000 clients. The enduring relationships partners have with these clients support the strong retention of client investments that we consistently experience. This does not happen by chance. The partnership has been, remains, and will continue to be a key competitive advantage. In a moment, you will hear from Peter Edwards, our Partnership Director, who will talk about the role of the partnership, how we support it, and how we plan to develop and nurture it in order to support our ambition to deliver that 10% annual growth in new business. Finally, the third key principle, which was to offer clients a full holistic suite of financial products and services to help meet their financial goals. Where the nature of a product or service included options or guarantees, or were capital intensive, or if they were high volume, low margin, or indeed very specialist, then we would work with a third-party specialist. For example, annuities, EISs or VCTs, and indeed mortgages. This continues to be our philosophy today. If we did not believe products were suitable for the retail investors, we would avoid them. For example, split-level investment trusts, precipice bonds, and the like. With respect to a client's investable wealth, we believe that it was important to have the right structure in place to manage this wealth by having our own investment funds across unit trusts, ISAs, life investment bonds, that's both onshore and offshore, and pensions. Furthermore, we would identify the best fund managers to manage these funds on a sub-advisory basis. Importantly, they were our funds, we would also be a manufacturer as well as a distributor. The structure established allows our clients to switch between individual funds free of charge and, in most cases, free of capital gains tax. Let's just think about this a moment. This is an important benefit in the life cycle of a client. For example, as clients approach retirement, they can reduce the risk of their portfolio by switching between asset categories, importantly without cost or potential tax implications. As clients start to turn their thoughts to mitigating inheritance tax, this structure enables the use of simple trust structures to optimize inheritance tax planning. In addition, the client has the peace of mind that as the funds are SJP manufactured funds, we set the investment objectives of the fund. We hold the assets of the fund on their behalf. We appoint a carefully selected external manager to manage the fund, and then aggravation to the client as the investment management of the fund changes, but the assets of the fund remain with SJP. This compelling proposition also supports the strong retention of client investments. As I said earlier, such market-leading retention does not happen by chance. The ingredients need to be in place. We regard our investment management approach as a key competitive advantage and provides good client outcomes. Rob Gardner, Director of Investments, will talk about the unique fundamentals of our approach, how it drives great client outcomes, and therefore supports that 95% retention of funds under management, and how we are developing our proposition to support continued growth in the business. SJP is both a manufacturer and distributor of financial products, and therefore, to use regulatory language, we are known as a vertically integrated wealth manager. This means we have a full end-to-end proposition for clients, encompassing the provision of bespoke and long-term financial planning advice through relationships, form, and administration. We are not a fund platform, nor an advice network, nor a pure asset manager. We are vertically integrated, and our stakeholders are all the better for it. This holistic approach means we take responsibility for all elements of the client proposition and ensures that we never lose sight of our end goal to provide great client outcomes. This is important as it drives the section of value. I want to reiterate that great client outcomes are not just about investment performance, but are also about providing appropriate and timely advice, ranging from utilizing routine tax allowances to IHT planning, to protection and to behavioral coaching nudges. It is also about the value of having a personal, trusted advisor to help guide you. Clearly, fees are important for clients, but it is the delivery of great client outcomes that matters most to them, so it is therefore where we focus our attention as a business. Alongside these competitive advantages arising from the principles of Utopia Life, our culture and shared values have been hugely positive factors in driving our business over the past 30 years or so, and we all take personal responsibility. These will continue to guide us as we grow the business to deliver our 2025 goals and beyond. This is how we will create future success for all of our stakeholders. The founders of SJP also encouraged a culture of giving back to those less fortunate, and they established a charitable foundation. Today, the foundation is the sixth-largest corporate foundation in the U.K. and has supported many great charities, which themselves have had a profound impact on countless lives over the years. Supporting the foundation continues to be a key part of our DNA, with many fundraising events around the country and some 80% of our partners and employees contributing every month from their remuneration. 30 years ago, this would have been classed as a best-in-breed- is we have broadened our ambition to continue to be regarded as a best-in-breed responsible business. This is personally important to me, the board, together with the wider SJP community and increasingly our clients. After all, achieving financial wellbeing only makes sense if the world is worth living in. We have been doing more and will continue to do more to have a positive impact through our client investments. We also have a direct influence on the environment in how we operate as a business, so we will continue to drive down. We will support the partnership in taking these same steps too. A responsible business is one that looks after its employees, one that champions and pushes hard for inclusion and diversity from the top to the bottom of the organization, and one that looks after the wellbeing and development of its people. A responsible business is one that also looks after the local communities in which it operates. Like the majority of businesses, we have more to do and are on a journey. It was a really, really proud moment for the business on achieving the Business in the Community Community Mark, one of only 37 companies worldwide today and continue to provide us with significant competitive advantage. Leap forward 30 years to the 2020s, and we see a new and exciting competitive advantage emerging, which we fully intend to embrace. Technology. We see a future of face-to-face advice empowered by technology, and COVID has accelerated this journey. Having already laid the foundations of a modern world-class ecosystem supported by Bluedoor and Salesforce, we are well-placed to take advantage. Simpson, technology officer, will talk about this emerging competitive advantage, how we deploy technology today, how we will embrace the opportunity going forward, and how we will see technology supporting our face-to-face advice-led proposition. At the same time, technology is enabling and underpinning our ability to limit cost growth to 5% per annum and delivering greater operational gearing in our business. Leveraging these competitive advantages of our business model, our plan is to drive continued growth in the business in the years ahead. As we look forward to the future, we see enormous opportunity in the U.K. wealth management space for St. James's Place. How we grow our business and increase our funds under management will not fundamentally change. We will continue to increase the scale of the support and advise a growing pool of clients. What's really important, though, is to ensure that we never take our eyes off the ball regarding our support strategy. Achieving sustained retention of funds under management through delivering high-quality service to advisors and clients, driving consistently good long-term investment performance, and ensuring we remain a robust and resilient business that clients trust. Scaling the partnership and providing it with the tools and support to better advise a growing pool of client investments has been the tried-and-tested method for building St. James's Place into the GBP 135 billion business it is today. It is in how we approach advisor recruitment and productivity. By investing behind technology to further support the partnership and clients and build our corporate scale in a more cost-efficient manner. By developing our investment management approach so that we continue to drive great client outcomes. The beating heart of the strategy will see us continue with those original principles of Utopia Life, paying attention to long-term relationships with our partners and through them with our clients. The final presentation today will cover our plans in Asia. Iain Rayner and my board colleague with responsibility for Asia will cover the progress we have made there, how we see the opportunity for our business going forward, and our immediate priorities to achieve cash breakeven by 2025. Ahead of that, a few words from me. We purchased Henley, a small distributor in Asia, in 2014. Adopting those three key Utopia Life principles which had proved so successful with SJP, the business plan for Asia was to have a long-term mindset, have our own distribution with a focus on building and maintaining long-term relationships, and to have a compelling client proposition. To be a manufacturer and distributor. To meet this third principle and become a manufacturer required us to obtain the necessary licenses and build manufacturing capability in both Hong Kong and Singapore. This task proved to be more time-consuming than we anticipated, but is proving to be a very worthwhile investment. We are confident that we now have a fast-growing and disruptive business in the most attractive wealth management markets in Asia, which will, in time, be value-enhancing to the group. What I find most interesting, having been with SJP since the start of 1993, are the parallels I can see that made its first cash profit in 2003, some 12 years after it was established. We have targeted a cash profit in Asia by 2025, 12 years after we purchased Henley and 10 years since we had a fully operationally vertically integrated business. With patience and a long-term mindset, some 30 years later, the business established by the founders in 1992 is now managing funds under management of some GBP 135 billion and has a market capitalization of over GBP 7 billion. We believe we have created together the correct ingredients and established the correct infrastructure in Asia in line with those principles that have made SJP so successful over the years. That's why we remain totally committed to and excited about the opportunity for SJP in Asia. A reminder of the agenda today. In a moment, you will hear from Peter Edwards, who will talk about the partnership, followed by Rob Gardner, covering our investment proposition, both key competitive advantages. You'll hear from Ian MacKenzie on our plans in Asia. I hope today's sessions help you better understand some of the detail underpinning our ambitions over the next few years and beyond, illustrate why we remain very confident in the outlook for St. James's Place. I'll now hand you over to Peter to kick off the first detailed session that starts at 5:00 P.M. Good afternoon. I'm Peter Edwards, I'm the partnership director at St. James's Place, responsible for the growth, management, and support to our U.K. partnership. I'm going to talk about why people join us by 10% annually in conjunction with our partners in the future. As an advice-led business, our partnership is the leading edge. It's the entity through which we deliver the great client outcomes that Andrew talked about in his introduction. A strong partnership delivers client outcomes that create value for all our stakeholders. We take great care in investing to support and nurture it. This forms a vital component of our strategy. Before I cover some of that, I want to talk a little more about what the partnership is and why it's so critical to our success. Importantly, it's not a single thing. It's a broad church of over 4,300 financial advisors. Our support to it is necessarily differentiated and provides the flexibility to support growth while recognizing and drawing strength from the diversity it represents. Sociocultural, cognitive, gender, and racial diversity help the partnership engage with and support its clients across the country. As an interdependent ecosystem with a common infrastructure, what brings it together as one is the sense of community that exists within it, as well as the social cultural link between all of these businesses and St. James's Place. Indeed, we have 21 regional offices around the major population centers of the U.K., and the partnership is represented in almost every city, town, and village in the U.K., as well as in Asia, which Iain Rayner will talk about later. It is an ecosystem which has changed considerably in recent years. Our partner businesses have increased in size and complexity as well as in number. supports over 800,000 clients, a number that has doubled in the last eight years. I'll come on to how we manage and support the partnership. Before that, I'd like to reaffirm why people join us. People will want different things when joining the partnership. We pride ourselves in providing the things that would otherwise distract great advisors from being face to face with their clients, the activity financial advisors enjoy the most. It helps partners support their clients with the backing of a FTSE 100 company. We offer people that do join us a range of suitable and relevant opportunities as partners building their own businesses or financial advisors within existing St. James's Place businesses. It's because of this flexibility to choose the journey they take that I believe we are the best place to build a great financial advice business they chose to join, unlike elsewhere, where they may have been acquired. The commercial relationship between St. James's Place and the partnership is stronger than ever. This appropriately recognizes the balance between remunerating new business and the provision of ongoing to enhance the quality of service to clients. To complement this, a unique appeal to the partners has always been the means through which, having grown a successful business with us over time, they can, at some point, transfer the whole or part of their business to another partner with the terms and financial arrangements facilitated by St. James's Place. This process, which ensures continuity of the advice and service for clients, is a real competitive advantage. Our corporate support for the partnership is stronger than so that they can focus on what they do best, supporting and advising their clients. From marketing, investment consultancy, technology, clients administration, HR, and finance support to regulatory compliance, business checking, and our in-house technical connection team. We aim to deliver support that achieves two simple things, to keep partners safe and to facilitate their business growth while delivering outstanding value and great outcomes for their clients. Providing support where and when it is required or appropriate, our field management team is a critical differentiator between St. James's Place and our competitors. Continued investment in regionally based teams whose total focus is to develop and supervise partners and advisors is a key USP. Investing in this team of managers, trainers, coaches, and business consultants, complemented by risk managers, operations teams, and administration staff, helps us differentiate our support to partners based on their needs and motivations, ensuring we that are passionate about delivering on behalf of their clients. Their passion is supported by the strength of our product range and our investment proposition that you will hear about later from Rob. The Academy has delivered over 680 new partners and advisors to the partnership since its inception in 2012, highlighting the scale of this home-based, the Academy, it now delivers enhanced training and development to a broader cross-section of the partnership. Unconstrained by geography or intake size, this evolution has shown our ability to adapt to a changing environment and will result in the Academy generating circa 400 new members of the partnership every year from 2022. This notably represents more than two-thirds of our gross recruitment, highlighting the growing importance of the Academy for the future. We help people find success in line with their ambition, skills, and preferences, as you will now hear. With a background as a senior manager in the hospitality industry, I decided in 2012 to change career and move into something that I'd always wanted to do, and that was to become a financial advisor and run my own business. I knew that I would only succeed if I got the very best training, and the St. James's Place Academy provided this to me, ensuring that I achieved the industry's required qualifications and providing me with the tools and support to set up my practice. My business would be exactly what I chose own successful practice, which grows via my clients' referrals. I've invested further and extended my knowledge and my experience by taking higher qualifications, becoming chartered, and going on to become a fellow of the Personal Finance Society. I thoroughly enjoy my work, and I am proud to be the go-to person for my clients' financial planning. Taking my career in a different direction with the Academy was a massive step at the time, but looking back, it's one that I'm incredibly glad that I took. As Andrew said in his introduction, St. James's Place invests in long-term relationships with the partnership, and they do so with their clients. This is critical to our ongoing success, and these relationships, in a great many cases, remain so strong. Indeed, experience shows us that retention is stronger still when our advisors have been with us for more than three years. The average age of the partnership is 46. This, against the market equivalent of 58, gives us confident retention, and the strength of our Academy, which has an average age on entry of 34, ensures our sustainable pipeline for growth. All of this gives us to the partnership since our inception. I am confident in our ability to grow the scale of the partnership on a managed trajectory while ensuring we are able to devote time and resources to evolving and improving support to those who. This marketplace, that is at best not growing materially. However, the extension and growth of our Academy makes this program an increasingly important. It is natural that Academy advisors take a little longer than experienced recruits to develop their businesses. Data suggests that after five years or so, they are on a similar trajectory. Of course, they have time on their side, as they have the benefit of generally being considerably younger. Growing numbers in the partnership is an investment in the future, sustainability of our business growth, and our focus remains to train and develop people to the point at which they are delivering strong client service as safely as possible. Of course, having selected and recruited people to join us, it is fundamental we manage them to success and retain them as part of St. James's Place's objectives of the management team. To enable the continued growth of the partnership, we continue to evolve our field management team support model. Deployed appropriately, differentiated, and consistent support to the partners and advisors based on their specific needs will not only continue to grow the size of the partnership, but will aid further the most is grounded in the needs of and the motivations of our partner businesses, and it helps partners and advisors grow and succeed at every stage. Development, helping partners attract and retain clients; business optimization, creating a more efficient business; and business change, becoming In supporting partners differently across our proposition and deploying targeted corporate support across a range of specialisms, we can make better use of our resources and help to drive best outcomes. Helping partners deliver client service excellence ultimately delivers strong long-term productivity. High-quality service that delivers value leads to referrals by clients. Around 40% of our. Providing partners and advisors with the knowledge, tools, trade craft, and corporate support to excel in delivering client service. Our consultancy aimed at our most successful businesses. We also deploy enhanced growth and development support to newer businesses that is particularly targeted. People become busier and to demonstrate expertise when working with new clients. Let me introduce an example of this. Leaving an employed banking background, I underestimated the difficulty in attracting new clients. I didn't have the luxury of a transferable client bank or access to existing St. James's Place clients. Quite simply, I wasn't creating enough income. St. James's Place provided a specialist manager to me with whom I could discuss client acquisition opportunities, learn how to develop leads, and help me purchase part of the existing St. James's Place business. Once I'd acquired, the new business improved. I now have funds under management of GBP 30 million, which generates revenue of circa GBP 200,000. In addition, I recruited my own support staff and an additional advisor that I was able to support through the SJP Academy and is now on track himself to be very successful. We see the development of expert managers as being a critical part of the development of expert partners and advisors, and we will continue to prioritize these to strengthen our management depth. Beyond developing the support we are able to deliver to the Partnership, it should not be forgotten that as a group of self-employed small business owners, the Partnership has both the desire and natural tendency to want to build great businesses. We therefore do not need to micromanage Partners. We achieve growth by harnessing the bottom-up energy and drive they generate while delivering the best top-down support we can. Of course, the last year has caused us to adapt to a changing environment and to change the way we do things. I'm pleased to be able to say that this has been extremely smooth, and our adaptation has exceeded my initial expectations. Across our field management team, it has managed to pivot from a client engagement model that was almost exclusively a physical face-to-face one, to one that has retained the personal aspect of our relationship-based model, but exploited technology and reach to stay in touch and keep businesses flowing throughout the pandemic. All this has been helped through our total focus on supporting partners' ability to engage with our clients. To be honest, it shifted our perception of what is possible in the future. Having deployed capabilities swiftly I am very confident about what the future holds. Provision of systems and technology to make it easier for partners to do business with St. James's Place will be covered in detail. Enhanced partners' ability to interact with clients remotely, more responsibly, and to process their business more accurately and quickly than before. Greater investment in systems and data analysis is also helping us determine where and for what reason, the intervention of our Growing partnership while helping us prioritize our activity. Crucially, we continue to use secured partner business loans as a means of providing. Relationships with St. James's Place are maintained and that their advice needs continue to be met. This process delivers great outcomes for clients, our partners, and St. James's Place. As part of this, agreements to deliver service to clients through continuity of service. 2020 was a year in isolation. We are not planning for the future based on what we experienced then. However, our growth strategy has been positively influenced by that experience. As increasing freedoms return to the way we work, we will be able to deliver 10% new business growth targets introduced by Andrew earlier. This will be achieved through a combination of recruitment of new joiners to the partnership. Better and more targeted partner support through our field management team and corporate functions. Utilization of technology. We are responsible for these core outputs and in Outlook have high confidence in all of them. The partnership strategy will deliver a supported and growing partnership that is better equipped to support clients' outcomes. A partnership that is comprised of stronger businesses able to thrive in the future and provide Areas on a planned trajectory, we will create a diverse, optimized partnership generating productivity growth over the long term. These outputs will positively contribute to the success of St. James's Place in the future. While maintaining a healthy flow of new business, we will retain and continue to strengthen the partnership, which is vital for our business. Through the opportunities provided by our investment in systems and other tools, we will maintain an efficient business and support a growing partnership. We make St. James's Place easier for partners and their clients to do business with, while also keeping their own businesses safe. We'll continue to strengthen the community feel and belonging on which the spirit of partnership is built and on which our growth depends. Let me introduce to you Rob Gardner, our Director of Investment. Rob will explain how our investment proposition supports great outcomes for partners and clients. Thanks, Pete. I'm Rob Gardner. I'm the Director of Investments at SJP. It's my responsibility to run our investment proposition. That's our core investment management approach, our Discretionary Fund Management services, and stockbroking. Our goal is really simple. We invest money to help deliver long-term financial security to our clients, and we do that by planning, growing, and protecting their wealth over time. I'm going to explain what makes our investment proposition unique, how we contribute to a retention rate of over 95%, and why I'm confident that we can grow to GBP 200 billion and beyond by 2025. I'll start by lifting the lid on what you can see at the surface, the funds and how we create smooth returns for them, and why we believe our size and scale gives us a competitive advantage. Let's start with the bigger picture. This is our investment management approach, which I'll now refer to as our IMA. It's GBP 135 billion today and growing. Discretionary fund management, or DFM for short. DFM enables us to create and manage personalized portfolios, perhaps with stock and sector exclusions that meet very specific client mandates. Finally, our stockbroking services enable clients to buy, sell, or hold a % of our gross inflows. Partners and clients invest in the model portfolios and underlying SJP funds. These funds, as Andrew mentioned, are unique to SJP, designed specifically for us, which means we have complete control and transparency of the underlying funds and can evolve their mandate over time. These funds can be blended together. Investment proposition triangle. We offer DFM and stockbroking via our own Rowan Dartington, which I now chair. Last year, DFM represented just under 5% of our gross inflows. Our aim is to attract investment managers and smaller DFMs to our proposition in the future. As Iain Rayner will explain later, DFM is a key component in our SJP Asia investment proposition. To end the investment proposition, giving partners something distinctive to offer their clients, which again, as Andrew said, is one of the founding principles of SJP. We currently have GBP 135 billion invested around the world. We have over GBP 70 billion invested in global equities, excluding the U.K. All of that is deliberately designed to give our 4,000+ advisors a unique investment proposition. The IMA enables advisors to plan, design. It means that no matter how diverse or specialist the needs of the client, something bespoke can be created. We have a senior and well-resourced team running the IMA. The ingredients that make up the IMA are nine portfolios, our three InRetirement funds, and underneath that, we have 39 SJP building blocks and funds. Remember, this offering is unique to SJP and gives our partners and clients total confidence that we can meet their needs in the long term. That's what you see on the surface, but how does it work? Our clients are in it for the long run, and the average SJP client has been with us for well over a decade. Their life expectancy is increasing, which explains why we're so focused on meeting their needs in retirement and taking a holistic approach to the way we advise them. Let's talk about performance. Our average client has seen their wealth grow by over 80% net of all fees, seen our clients double their money over the past decade. That's over a 7% return net of all fees, outperforming money in the bank by 6.5% and crucially, inflation by 5.2%. Even with this smooth level of performance, we can't predict the future. You'll never hear me or our CIO, Tom Beal, make predictions about what will hit the headlines next week, what will happen to the S&P 500 next month, or what will happen to the FTSE 100 next quarter. What we do know is in a world where interest rates have fallen over the last 40 years and the risk that inflation will continue to rise in the future, doing nothing will not achieve long-term financial wellbeing for our clients. Our partners advise clients to take risk and invest to grow their wealth. What I want to ensure is that we invest for our clients in a safe and controlled way. In this uncertain world, all we can do is ensure every aspect of what we do is in the best possible condition to deliver. There are four key ingredients that make up the perfect recipe for long-term results. These ingredients are fundamental to what we do, by how we build portfolios, and how we select, monitor, and change our funds Doing this at scale whilst maintaining the flexibility of our investment proposition is complicated. Let me break it down. In order to manage GBP 135 billion in assets, our first and most important ingredient is to have a well-resourced team of senior individuals with the depth and breadth of experience to oversee what's going on across all our SJP funds and portfolios. We've got in-house specialist investment capability from a team of 39 people with over 300 years and over 200 years of experience. Our senior team all have previous investing experience, and they've been selected carefully to ensure we've got specialist input from every angle, from equity five portfolio strategists, all supported by a team of analysts and researchers. Having this team is key to our disciplined research and decision making. When it comes to investment research, there is. From this, we can design, develop, and deliver the portfolios that meet the evolving needs of our advisors and clients. This gives peace of mind for both parties and decision makers with extensive insight so that they can make good decisions. By combining our team with excellent data and technology, we can get the best possible results. We have 35 external data from internal and external sources. This feeds into a bespoke investment data hub that we've built on AWS and Snowflake, supported by Ian MacKenzie's technology team, which feeds the investment team the insights they need to design a new portfolio or select, monitor, and change our fund managers. We continue to invest in industry-leading technology component in our day-to-day decision making. We understand that we can't make the correct call every time. What we do know is if you get the right group of people in a room with the right technology in your internal team and five independent non-execs, who between them have over 150 years of investing experience. On top of that, we have a panel of six expectation, portfolio construction, and fund manager research. They challenge and support our ideas and improve our decision making. Crucially, what guides us? What's the recipe that keeps us on track when we're investing for decades, not days? We have our investment beliefs which guide us in everything we do, starting with, one, great client outcomes, two, asset allocations, six, disciplined research, and seven, responsible investing. Those are the four key ingredients. Let me bring them to life through a case study. They used to be an engineer, and Mrs. Taylor used to be a solicitor. They now enjoy time being grandparents. The problem they face is that they're no longer earning money. They're just spending their retirement savings and living to 90, and a 25% chance of one of them living to 100. Unfortunately, the Taylors, like all of us, don't know what inflation is going to be for the next two, three decades. It's where they are, that just won't work. As they withdraw their money and try to make it last for the long term, this introduces a new risk. It's called path dependency or sequence risk. Designed to deliver a secure income to our clients in retirement. The Taylors' advisor, Suzy, who graduated from the SJP Academy a few years ago, uses her relationship and deep understanding of the Taylors, as well as financial planning tools to translate their financial goals into valuable advice and a tailored investment strategy. She advises them to invest in the InRetirement Growth fund, allowing them to take out 4% of their money a year, inflation adjusted for the rest of their lives. It ensures that they've got capital left over to pass on to their family. This is a great example of intergenerational financial planning. This is why we're so well-positioned to come up with solutions like this for the Taylors and similar clients. Keeping the case study of Mr. and Mrs. Taylor in mind, how do our beliefs work in practice? Let's start with investment belief 1, achieving to stay flexible and ready to adapt. If for any reason the outcomes of our clients change, their partner, Suzy, can adapt quickly to reflect that. We're aware of the challenges finance, striking the balance of having enough income to meet their current needs and having enough to last the rest of their retirement. Biggest opportunities we face in the U.K. and around the world. As we help our clients have a secure income for their retirement, we increase the retention rate for Suzy and SJP's. We're able to blend asset classes to meet the risk and return profile of different clients. As I said earlier, that results in 5 million different investment solutions needs. If they want something truly tailored, they can do that with DFM. The third value is diversification. Diversification between asset classes as well as by managers and geography. Despite the fact we can't predict what the future holds, this principle ensures we don't have all our eggs in one basket. Diversification defends. Fourth, active management of asset exposure and stock selection can add value, and we'll use it appropriately where we think that active management can improve that process. We believe in active management. Being proactive about how we select, monitor, and change means that at any given time, we can ensure we continually have access to some of the best fund managers around the world. The performance of our three new global gets results. Underwriting our commitment to our UK equity fund manager through our deep understanding of their DNA has meant we have captured significant relative outperformance. Analyze and carefully manage risk because we know that's the best way to beat inflation as well as path dependency for the Taylors over the long term. We are continually monitoring our asset allocation decisions, seeing their performance over time. Six, disciplined research and decision-making. We have a well-resourced team with world-class data, technology, and insights pulled together by equities, bonds, alternatives, and property. We challenge ourselves by bringing in independent and external expertise to review every challenge. Again, we won't get every decision right, but by using this disciplined approach, we'll make more and more of the right calls, which will improve our performance over the decades to come. Finally, responsible investing is a strong source of financial performance. We know that integrating environmental, social, and governance factors, ESG, to the circular economy of make, reuse, and recycle is a GBP 4.5 trillion opportunity according to research by Accenture. Let me bring that to life. We've invested over GBP 117 million now cost more than before because they're culture aware, waste less, and have strong consumer commitment and therefore brand momentum, which means Nike's revenues are up, their engagement. Two years ago, we committed to have 100% of our fund managers signed up to the UN PRI, which they now all are, and 63% of those are rated A plus, which is the very best Task Force on Climate Related Financial Disclosures report, TCFD. We also produced our stewardship and engagement report. We're one of a handful of FTSE 100 companies that have done this. We operate better as a business because we know if we get this right, our clients, like the Taylors, benefit as well as the planet. This is how our investment beliefs help deliver financial well-being in a world worth living in. We've gone behind the scenes of our investment management proposition to understand the InRetirement funds that the Taylors were advised to invest in. I hope that this makes you feel as confident as I am that SJP is ready for the future, whatever it holds. Where are we now? We're continuing to monitor, adjust, and improve our investment proposition so that we can maximize performance for the Taylors and our other 830,000 clients. Our size and scale means we're able and addressing some of the short-term performance challenges which we identified in last year's Value Assessment Statement. For example, we'll be making changes to our U.K. managers and creating a single U.K. building block, giving us better control over the style of managers that we have. We'll also merge our various alternative funds into a single absolute return fund, which is a simpler way to have diversification against equities and bonds. Later this year, we'll be relaunching our largest equity fund, which is over GBP 14 billion, and we will align it with the one and a half degree C world. We will have reduced our fees on the external fund managers' footprints and half the carbon intensity of the MSCI World Equity Benchmark, and we'll do all of this with a 1% tracking error. As you can tell, I'm really excited about many of our clients double their wealth, beating cash and inflation, and we've done it with less risk than equities. We have the recipe and the ingredients to repeat that performance. Our IMA plus DFM plus stockbroking gives our advisors that ability to offer tailored and bespoke solutions for their clients. On top of this, we're open to considering the right consolidation opportunities in the DFM market. We'll continue to ensure our advisors and clients have access to our unique and again. Let's put that all together. Our size and scale puts us in a unique position. We have a senior well-resourced team with great data, technology, and insight that the Taylors achieve long-term financial security. In a world of low interest rates and one where many of us will live to 100, in a world where the big risk on the horizon is inflation, the biggest risk of all is not investing. We're ensuring that we're in the best place to make better decisions, and whilst we can't get every decision right, I believe that in an uncertain world, we can continue to grow our clients' wealth decade after decade after decade. Thank you. Let me hand over to Ian MacKenzie to talk about how we are investing in technology. Today about technology, what it means for St. James's Place, what we are doing today, and how it will drive and support the SJP of 2025 and beyond. The pandemic has highlighted the importance of effective technology across all sorts of businesses, and we are no exception. Allowing a smooth transition of over 12,000 people from office space to remote working. This is testimony to our journey over the last five or so years, and specifically to our significant investment in Bluedoor, which has laid the foundation for our technology strategy, and also our move towards becoming a cloud-first organization. Our partners and clients, just like all of us here today, are a lot more tech-savvy than they were a year ago. Everyone is more comfortable using technology, and expectations continue to soar. We've risen to the challenge of operating in a difficult environment by introducing digital and remote tools for our partners and clients, reducing paper and enabling new ways of working and collaborating. St. James's Place is, and always has been, a business providing a common infrastructure. Exactly as both Andrew and Peter touched on earlier. Combining and integrating the St. James's Place ecosystem with world-class technology will create a strong proposition, but also significantly in terms of sustainable expense management, while meeting the current and future needs of clients and advisors in this age of experience. We think of this as building our next generation client experience, or NGCX, for both today's and future clients of St. James's Place. It's about next generation experience, next generation technology, and also about next generation clients. This is an ambitious program of work to reimagine our digital client experience. From today's Online Wealth Account. This will complement and strengthen the outstanding personal face-to-face led relationships our partners already enjoy with their clients. The program will enable great outcomes for advisors, efficiency, scalability, and of course, those great personalized outcomes for their clients, driven by data and insights. Through all of this, it would deliver great outcomes for our business. Sustainable growth of inflows, high retention through great experiences for clients and partners, operational leverage through efficiencies and scalability, while keeping the business resilient. The quality of the St. James's Place partnership and our commitment to and investment in world-class technology, we are strongly placed to deliver a leading digital experience between clients and partner, powered by St. James's Place. This graph is from some Gartner research showing the % of wealth clients choosing different interaction channels based on assets under And technology. A hybrid approach. Recent research from Salesforce supports this hybrid approach, with 31% preferring human interaction when making significant financial decisions. Of record and Salesforce, our system of engagement. Both are bedding in nicely. We've seen their resilience and scalability in recent times. We invest in long-term relationships. This is just as true with technology partners as it is with our advisors and clients. We have long-term strategic partnerships with SS&C Intellect SEEC. As the U.K.'s largest advice-led wealth manager with ambitious plans for the future, we have competitive advantage in being able to invest with these leading providers. Through these relationships, our strategy is to deploy world-class technologies, leveraging continuous innovation by tech firms to support our partners and clients and deliver our next generation client experience. Bluedoor, our system of record from SS&C, has enabled us to scale our business even through the pandemic. The recent tax year end demonstrates this. We saw record new business in March, all handled by Bluedoor, with the majority of cases not touching. Delivering sustainable scalability for the future. While mentioning Bluedoor, an absolute game changer for our technology journey and now part of the fabric of St. James's Place, we shouldn't understate just what we achieved in recent years with a very successful implementation and migration journey. Hundreds of thousands of clients, billions of funds under management, all successfully transformed to the new system. Quite a rare event in U.K. financial services. What's even rarer is being able to then actually decommission legacy back office systems, something we achieved during 2020. I'm particularly proud that our Bluedoor program was awarded Best Implementation in Funds Europe FundTech Awards 2020. Salesforce, our system of engagement, is all about long-term relationships, hyper-personalized service delivery, and efficiency in partner businesses, as well as in super practices. To highlight this. You can have two, three months worth of work, you can see the hours they've put into it by all members of the team before that person is even a client of ours. It's just such a great way of really appreciating the amount of work that the team puts in for each client. We're able to run reports on a monthly basis as to who we need to book in next month, the month after, the month after that. My team do that automatically now without me getting involved. That's taking a lot of stress off me. Obviously it off the advisors. That gives us a bit more time now to focus on business, to focus on cash flows, clients, et cetera. If we can get that right, we know clients will come back for repeat business. When Salesforce came along, you could say I wasn't exactly the most happy about it. I've been completely proved wrong. I actually really like Salesforce. It's really easy to use. It's dead simple. It's really simple for training up other people. The system itself will be what we need it to be. It will deliver what we want it to. Look at it as a tool to improve the service that you deliver to your client. Bluedoor and Salesforce, our combined ecosystem, not only providing the bedrock for powering our digital strategy, but also the key enablers allowing us to reimagine the way we build out our offset per annum expense guidance. As you would expect, we are well on the way with leveraging this ecosystem, in particular partnering with fintechs, allowing our partners today to choose to access a range of tools for their businesses. DocuSign, Qwil Messenger, think WhatsApp, but compliant. Advisors with a digital front office. DocPortal, providing a document management portal for advisors and clients, and Digital Clipboard to support digital client onboarding, including fact-finding and compliance. Just like all of our clients today, Mr. and Mrs. Taylor, who Rob introduced to us earlier, can currently access their St. James's Place Online Wealth Account. Asset allocation information, personalized actual performance information over time periods of the Taylors' choice, electronic rather than paper correspondence, secure messaging, and including that last-minute ISA investment before the end of the tax year. All this live and used day in, day out by Mr. and Mrs. Taylor and all our clients and partners today. Deloitte's 10 Disruptive Trends in Wealth Management reports notes that many advisors still face significant barriers to providing holistic financial advice to their clients, including access to the right tools and software. I would argue not if you're a St. James's Place partner. Our continued investment in this area will deliver increased productivity, stronger client relationships, and a more efficient St. James's Place. Our strategy is also about simplifying our technology estate, reducing costs, and increasing resilience. For example, our investment in Bluedoor and Salesforce has already enabled us to decommission our back office mainframe, which was for 26 smaller systems. Tangible outcomes which support our 5% per annum expense guidance. Our technology architecture is moving to a simpler and more structured design than we had before. This approach makes our technology simpler and cheaper to maintain, reduces operational risk, and is much more scalable. Our investment in automation will deliver over 100 processes automated by the end of this year, an equivalent saving of 25 FTE equivalent operations, technology, and business checking. This is on top of the 70 or so bots we already have working, which have freed up 21 FTE opportunities already. This operational excellence journey, combined with simplification and automation, is the fundamental principle which will enable us to deliver on our 5% per annum as we manage and mitigate the associated fast-changing and evolving risks through technology solutions, awareness and training, support from external experts, including a specific role on the board's technology advisory group. Almost the state of the nation as to where we are today, and hopefully I've shone a light on what we are actually doing today. I suspect a far more technology-enabled St. James's Place than you might have perceived. What about our future technology journey as we move from the information and digital age into the experience age? The key word here is client experience. Let me bring to life how we're using data and the future value we see in it. We start from a strong place. We have years and years of data around every transaction placed, every piece of advice given, every investment made, and every investment encashed. One of the strong advantages of being a long-term integrated advice business. Rob talked earlier about some examples of using this data in the investment world. Our key focus over the coming months and years is leveraging this data to support and drive outcomes for clients, advisors by artificial intelligence insights to increase efficiency and productivity. We're already working to pilot Einstein artificial intelligence within Salesforce to identify next best actions and opportunities for clients to achieve their goals. Similarly, AI-driven insights will enable timely interventions with partners as part of managing conduct risk and keeping the business safe. Data and AI will also enable an evolution from our successful robotic process automation to intelligent automation of the future. We are developing this initially within our business checking function, and indeed last year won an award for our early work in this area in partnership with Intellect, the Celent Model Wealth Manager for case studies for intelligent automation and wealth management. This intelligent automation will further underpin our expense management over the coming years whilst providing consistency and to support partners. This will drive efficiency and productivity, allowing partners to spend more time face-to-face with more clients, focusing on the complexities of the advice and straightforward advice. To support all of this, we will continue to invest in data science capabilities alongside our strategic partners as we increasingly leverage the power of our ecosystem through data, including maturing our use of Salesforce through adoption of Marketing Cloud, social media integrations, and more AI-powered insights. These plans will enable us to continue to grow inflows in a long-term, sustainable manner through increased insights, deepened relationships and productivity, all underpinned by tech. Beyond data, we are focused on re-engineering our business processes from paper-heavy to digital-first, and move from electronic correspondence, PDFs rather than paper, to true digital experiences for partners and clients, delivering efficiencies, cost savings, scalability, and much with clients and partners for our Next Generation Client Experience, and expect to have a pilot launched in Q1 of 2022 with continuous rapid enhancement and innovation thereafter to design and deliver the digital experience they want from St. James's Place for both today and tomorrow. Our focus on data and reimagining our digital experience for clients is part of our operational excellence program of work over the next few years, making it easier for everyone to do business with St. James's Place while reinforcing our capabilities to support and enable sustainable growth in inflows and powering operating efficiency across the organization, and crucially, funded within our expense guidance. I believe our plans are significant and ambitious and will power our future growth alongside underpinning operational leverage while keeping the business resilient. We have a track record in safe delivery given our Bluedoor and Salesforce journey in recent years. We have led to a data and AI integrated ecosystem, delivering growth, scalability, efficiency, and resilience while reducing complexity, costs, and operational risk. We are already on this journey and beginning to see the benefits, and these will further crystallize over the coming months and years as we deliver an efficient St. James's Place of GBP 200 billion funds under management and scaling well beyond that. Of course, all these plans are included in our medium-term expense guidance. We are a people business. Efficient growth as we look to the future. Thank you very much. Now I'd like to hand over to Iain Rayner, who will talk about how we are building a long-term business in Asia. To talk to you today about our business in Asia. I'm Iain Rayner, and I led the projects in 2013 and 2014 to acquire The Henley Group to form SJP Asia. Since October last year, I've taken over executive board responsibility. I think I'm right in saying that the last time we gave an in-depth market update specifically about Asia was at our annual results presentation in February 2015. It now seems an opportune time to look again at SJP Asia and provide you with an update. An update on the considerable amount our team of partners, advisors, managers, and employees in Asia have achieved over the last seven years. More importantly, an update on the plans in Asia for the next five years to 2025, and our strong belief in and commitment to the longer-term Asian opportunity for St. James's Place. There are three key things I want you to take away from this presentation about SJP Asia today. The first is that we plan to grow gross inflows by 25% per annum compound to 2025, such that we have a business growing from its GBP 1.3 billion core funds under management by 27% in Asia in 2020, and are confident of achieving the 25% growth in gross inflows target in 2021 to over GBP 400 million. The second is that having invested to build our presence, we plan and expect to move SJP Asia to cash breakeven by limiting further fixed expense growth while increasing fee income through new investments and maturing of funds in gestation. Beyond 2025, we expect to grow cash profits from the Asian business strongly as those operating jaws widen. In 2020, we reduced the post-tax net investment cost in Asia to GBP 17.4 million from GBP 19.9 million in 2019. We plan to be below GBP 15 million in 2021, then to reduce on a consistently predictable basis to cash breakeven in 2025. The third is that we see a real long-term value in building a disruptive, growing, and profitable presence in two of the most attractive wealth management markets globally. With the opportunity compelling, when we talk about SJP Asia, we mean Singapore, arguably the world's most exciting wealth management market right now, and Hong Kong. Our Hong Kong office has a satellite office in Shanghai dealing with expats in China. We purchased The Henley Group, the building block of SJP Asia, 7 years ago now in 2014, in order to provide us with a long-term strategic option in an exciting growth market. The origins of The Henley Group actually go back to the early 1990s, around the same time that SJP was founded. In 2014, our market entry strategy to the fast-growing wealth management markets in Asia was as a British brand built on largely expat British partners serving largely expat British clients. I talked earlier about the considerable achievements of our team in Asia over those seven years. When we purchased Henley, it had half a billion pound sterling of funds under management. SJP Asia has GBP 1.3 billion of SJP core investments and DFM, plus another half a billion sterling of third-party assets. From 4,000 clients in 2014 to 12,000 clients today. From 50 advisors in 2014 to 132 at the end of 2020. In terms of infrastructure, we have invested largely through our new life company in Hong Kong and a branch of our Dublin Life company in Singapore. We operate Rowan Dartington's DFM service in Hong Kong and Singapore under the St. James's Place brand. Asian clients and partners. SJP Asia was an early adopter of Salesforce. There have been challenges, but we have overcome them and are well-positioned for the next phase of our growth. We're particularly focused on the U.K. expat market as a U.K. expat-focused finance, which Australians make up the biggest concentration, and increasingly high-net-worth families from across Asia who live in or use Singapore or Hong Kong to conduct their financial affairs. In many instances are really global citizens with homes and families spread across the world, including and often in the U.K. I want you to hold on to that thought of the Asian high-net-worth families and the global expats using Singapore and Hong Kong to invest and structure their financial affairs because that's where our big medium to long-term Asian opportunity is. Partners in SJP Asia today look after 12,000 clients with an average of GBP 110,000 core funds under management invested. That's GBP 1.3 billion of core SJP investments at the end of 2025. Our Asian partners are consistently acquiring 800 new clients a quarter, 3,200 per annum. Even if we don't increase that run rate, 27,000 clients with an average of GBP 185,000 invested with us is GBP 5 billion. How are we going to do that? There are 4.6 million mass affluent people with between $100,000 and $1 million to invest in Singapore and Hong Kong combined. There are another 300,000 people in Singapore and Hong Kong combined with between $1 million and $30 million to invest. That's a total asset pool of just under 2 trillion. A path to those clients who may have bought financial products on an ad hoc basis, but who now want and need to take a more planned and ordered approach to their finances, often as they get older. We also want to offer an alternative to the private bank client who is perhaps tired of the fact that they're frequently being told they need to up their minimums to stay with the private bank, or whose advisor is thinking about leaving, perhaps because they want to take a more client-centered approach in an environment where they work for themselves. Our guiding principle must be that our partners are doing business with clients who see value in international family wealth structuring, in wealth extraction strategies. The U.K. is still seen as an attractive place for many Asian families to educate their children at either school or university, and also to buy property. Even more so given the 300,000 BNO visas which are likely to be handed out to Hong Kong citizens by the U.K. government. We do financial planning and investment in a way that is cognizant of these important international lifestyle considerations. We're very conscious of those clients and their needs, working with Asian families on those aspects will be very important to us between now and 2025. We're also working to make sure our SJP Asian versions of the investment proposition and DFM are optimized for Asian clients. That means more international and Asia-centric funds and portfolios. SJP in Asia is and always will be our partners and advisors. The diversity and strength of the U.K. partnership is incredible. For many years, I've been lucky enough to work closely with many of the large and small who have around GBP 1 billion of funds under management each. These businesses are compounding at an astonishing rate. When I walk into the SJP offices in Singapore or Hong Kong, I feel a strong similarity to our offices and teams in London, in the City and Canary Wharf and beyond. Enthusiastic, motivated, bright people serving the bankers, lawyers, accountants, and business people in the world's most exciting financial centers. Clients follow or do business because of their advisors. What I think we know how to do is recruit and help develop the best partner businesses to find the right people and back them, to help them recruit, to provide them with the right products and services, to provide them with the right financing and technology and expertise. If we're in a business of 27,000 global expats and Asian high-net-worth clients in Singapore and Hong Kong by 2025, then we need a diverse, high-quality team of partners and advisors who will attract and retain them. We start from a good place. We have some brilliant partners in Asia who have stayed with us from the Henley acquisition and successfully built their businesses. We've recruited the very best expat-focused financial advisors in Singapore and Hong Kong since 2014 to become St. James's Place partners. As I've just said, we continue to recruit them. One of the lessons we've learned is that we mustn't chase advisor numbers for the sake of it, recruiting too many inexperienced advisors. You'll have seen our Asia advisor numbers drift back in 2020 as a result. Our 2025 partner strategy is to have the best 100 partner businesses we can, split roughly 50/50 between Singapore and the combined Hong Kong and Shanghai offices. Many of these partner businesses will be multi-advisor. Increasingly, we're becoming the home for private bankers or those running family offices for high-net-worth Asian families who want more control over their lives or to work with their clients on their terms. We must offer a career path for the very best Asian life assurance agents. A partner proposition based on empowerment and responsibility to look after their clients and their own lives. It's going to be a really exciting next few years. Just last week, we completed the recruitment of an advice firm in Hong Kong with GBP 130 million of funds under management and six advisors. That's the type of thing that I know we can do more of. Just like we are in the U.K., we've got to be the best place for entrepreneurs in Singapore and Hong Kong to build their financial advice businesses. I started out talking about the history of SJP in Asia because I wanted to demonstrate that we have strong roots dating back through The Henley Group to the early 1990s. The point I want to make here is the importance of a long-term-- We've quietly and patiently built a 1.3-- and also to someone who has only a short-term mindset. That's a principle which is incredibly important to our clients and partners in the U.K. as well. It's in the DNA of SJP. This year, our target is to have gross inflows in Asia north of GBP 400 million, which will be 25% above 2020, Reduce the cash net investment to below GBP 15 million. We're on track to deliver both. We plan to move to cash breakeven in 2025 on a broadly straight-line predictable basis. Andrew mentioned this earlier, some historical perspective from SJP in the U.K. It was really only in 2003, SJP's 12th year of existence, that the U.K. business became consistently cash profitable. Our business plan in Asia is to reach the same milestone at the same point, 12 years after the acquisition of Henley. I've set out our medium-term financial targets to the end of 2025, 25% compound growth in gross inflows to GBP 1 billion per annum, GBP 5 billion core funds under management, and cash breakeven. Just as we have been in the U.K. over the last 30 years, we intend to be a market disruptor in Asian wealth management, bringing a long-term partner-client relationship advisory approach to the market amongst the big life insurers and private banks in Asia. We will win by building the best 100 Asia partner businesses we possibly can by 2025, by building a long-term advisory client proposition with a distinct Asian-U.K. perspective and flavor, by being open and clear in business and the opportunity for it. Over time, we will build confidence and excitement in SJP Asia by delivering in 2021 and the four following years to the end of 2025 against the clear numbers and strategies that I've talked about today. Thank you. Thanks, Ian, and the rest of the team for today's session. I hope this Capital Markets Day has given you a helpful insight into our business and why we remain excited about our future. Today's session will have provided you with some color around how we will deliver against those going forward. Peter explained how in the context of a U.K. advisor market that is set to shrink rather than grow, we remain confident in being able to expand the partnership through a combination of recruitment and an increasing contribution from our Academy. Not only that, we have focused plans to support enhanced productivity across the partnership. Rob talked about accounting. We are evolving and developing our distinct investment management proposition so that it continues to underpin great client outcomes and support high retention. Ian MacKenzie spoke about how in a fast-changing digital world, we see technology emerging as a key competitive advantage for SJP, as well as acting to enable and underpin our medium-term expense guidance. Finally, Iain Rayner spoke about our growth strategy in Asia, how we will reach cash breakeven by 2025, and our commitment to creating long-term value in some of the most attractive wealth management markets worldwide. That's it for the presentations, and we look forward to joining you for a live Q&A session shortly. Good afternoon, and welcome to the St. James's Place Capital Markets Day live Q&A session. I will now hand over to Andrew Croft, Chief Executive of St. James's Place, for opening comments before we open the line to questions. Thanks, Rob, and welcome everyone. I'm joined not only by my executive board colleagues. Let's now open up to Q&A. First question, please. Can we please have the first question from Andrew Sinclair, Bank of America, Merrill Lynch? On the SJP Academy, you talked about delivering 400 plus from the SJP Academy into the partnership from 2022. Would you see that as a steady state or do you think it looks like growth? I think you talked about consolidation opportunities in DFM. Just wondered, is that part of the break-even timeframe targets for Rowan Dartington, or could that accelerate? Thirdly, it was just on current trading and holidays. I think most of us on the call haven't taken many days off so far this year. I expect your advisers are similar as the world opens up again. Thanks. Yeah. Thanks, Andrew. Actually I'll take them in reverse order and do the current trading one first. Look, we are really encouraged by what we've seen. You're absolutely right, it's a tricky year to call, isn't it? It's not a year where you can do simple extrapolation. Over to Rob on the DFM. Hey, Andrew. Rob here. Just on DFM, the pathway to breaking in 2024 is really just based on us focusing on getting speed up or slow down, depending on the nature of that deal. Okay. Thank you. Pete? Thank you, Andrew. In terms of the projections for the Academy moving forward, of Academy graduates into the partnership. I think one of the important things to remember is an Academy graduate is on a training program that is not determined in terms of timescale. At the very day they join, there is a specified graduation point. It's something that will remain flexible in the medium term. Okay. Thanks, Peter. Can we have the next question, please? Good afternoon, everyone. Thanks for taking my questions. There's going to be three in three different areas. The first one is probably aimed at Rob, I'd imagine. As you outline in your piece, as you outlined, that's always been the objective, but it is ever harder at the moment. You obviously outlined that you thought that you could. Just really curious, digging into a bit more detail there. What kind of assumptions are you making in the annual report and economic assumptions? You're assuming 2.6 lender for linked sum and a 3.3 inflation rate. I appreciate it's for slightly different purposes, but nonetheless, just wondered what in the area. Second set of questions around Asia. Thanks for the comments there, Ian. Just one station in that number. Maybe just outline how much that actually is constraining the revenues, if you like, of the business because I didn't associate that business with the gestation business. Similar to the revenue margin assumption kind of now versus 2025. The final question or area really is just a quick one really just on the academy. Trying over time, have they been getting better or worse? Thanks. Okay. Thank you, David. Since the last question was on the Academy, I'll probably go to Peter first to answer the Academy question. SJP Academy are predominantly younger. They have less experience and therefore can take slightly longer to get going, as opposed to new joiners from an industry background or who came from an existing industry background. Another factor that we've known for many years is the longer Partners, irrespective of their background, stay with the partnership by way of numbers or indeed move into a different type of business shape. We've got a long track record of people growing their business over a period and for longer with us. Yeah, as you say, it's a challenging question. The way we've tried to tackle it is with our core building blocks. I talked about these global equity building blocks bit by start, is equities. You'll know that within equities you've got growth, value, and quality. Depending on what environment you're in, quality might do better or equities. The challenge, as you know, is that bond yields are extremely low, which is why we started to sort of build out our alternatives piece as one scenario we saw in equities. In terms of the expected return on alpha, each one of those building blocks has active mandates with a high tracking error. For net of all fees or net of the fund manager fees, a 1% alpha assumption. That could be 20% on top of a 5% expected return. Asia, I'll just go to Craig on the gestation first, and then Craig can hand over to Ian for the second part of the question, David. Yeah. David, hi. The gestation figure for Asia is inevitably pretty increased. The products and the charges work much in the same way as you're familiar with in the U.K. products. What you'll see is an increase in that top level goes on. As that becomes a more meaningful figure, it's one that we may choose to track at the Asia level externally. Really. Hi, David. Yes, it's. We should use the U.K. experience as a guide to the paths of cash profitability in 2025 and obviously the U.K. being the proxy. Okay. Could we have the next question, please? Yes. Can we go to Nasib Ahmed from J.P. Morgan Cazenove, please? I'm sorry, I missed a part of the presentation, so I'm not sure if it is already covered. You mentioned that there are plans to increase the productivity of the partners over the next few years. It's a bit complicated to measure, as in what is really driving productivity? That's one question. Second question, I think you mentioned that about two-thirds of your gross recruitment in Academy mean that majority of your net recruitment is done through Academy. Okay, thanks, Ashik. I'll pass those over to Peter. Yeah. Hi, Ashik. For the last decade, and indeed, the way we approach recruitment in the wider partnership has always been on a quality-led basis. As we mentioned, we, to achieve our own growth aspirations, need to focus more on the SJP Academy achieving a greater proportion of new joiners. Yes, there will be over time, the SJP Academy. This is something that we're very focused on managing the growth of the business in a sustainable and manageable way. We have evolved the management of the partnership through what we call the field management team. What we're looking to do very clearly is, as the partnership matures, and it's important that we look to isolate the category Oh, not category, sorry. The way a partner wishes to grow their business, be they in the business development phase, the field management team through to help the partners grow, stabilize their business, to create more efficiency and to create the business that the partner ultimately wants to. Look to measure because you are right, it is an art, not a science. It is very important that we are able to establish the growth required for each individual business in the way that business wants to be. I'll just see if Ian has anything to say on anything. Nasib Ahmed. No, I thought Pete covered most of the bases there. I think another way of saying it is what we're trying to do, Ashik, is for the management team and the each own business cycle, and I think we can see some really great opportunities for more impact on the partner business. The second one is a post-COVID world where partners themselves and conducting business remotely. Partner businesses themselves are seeing opportunities to really increase their own meeting capacity remotely for appropriate clients. They've opened up an opportunity to increase their business efficiency in this post-COVID environment. To ask a question, but that's already been answered. Please, could you take your hand down? That'd be most helpful. In the meantime, we'll go to Oliver Sherr from Deutsche Bank, please. Afternoon, everyone. Large one, not preponderance, but given the mix between gestation business and unit trust and ISA business, that faster new business growth in the short term has a more negative- Open to the opportunity of consolidating other DFMs, which I don't think I've heard before. Did I hear right? How much potentially could you spend on that? If you buy DFMs, you're not recruiting them yourselves. The third question I've got is on technology. You say you have a competitive advantage. Thanks, Oliver. I'm going to pass the revenue margins to Fred. Yeah. Hi, Oliver. The input in range that we've given from net income under funds under management, which may sound counterintuitive if you think about some of the business that goes straight into is going. Put simply, no change in any guidance we've given at that level as a result of business performance that looks about positive gearing and negative gearing in the presence of fixed costs in any calculation. That has an impact. DFM one. It's always been part of the business model, Oliver. You're absolutely right, any acquisition, particularly an acquisition of a people business, is risky. It's about being the right fit for the business. I hope that helps. I'm going to pass over to Ian on the technology. Thanks, Andrew, and thanks, Oliver, for the question. Some of that's our ability and scale to engage with large tech firms and their desire to work with us. We're seeing now tech firms walk towards us wanting to work with us. The other point I'd bring out here is, I think for many people, and I suspect many people on the call, we've probably not shone enough light on what we're actually doing and where we are and the journey we've been on. Ashik, I'll just give you a little bit further advance than that of many firms. The article on to say, "SJP have a level of functionality many mainstream ISA platforms would do well to emulate." The big tech given our scale and our plans giving us that competitive advantage going forwards. Thank you, Ian. Just looping back to the DFM consolidation, I should have said anything we do will be small. That economically we'll be struggling, and we could be a good home for them. Can we go on to the next question, please? Next, can we go to Andrew Crean from Citi. Can you just give me a sense of your retention rates for graduates from the SJP Academy? For example, of the graduates in any given year, what % would you still expect to be part of the partnership in, let's say, three to five years? Your gross flows per advisor looked like that peaked in 2017 and has declined every year since then. I appreciate that some of that is the consumer sentiment impacting the flow number, but with your investments, what do you see as a run rate for this? Thank you. I'm going to pass you over to Peter in a minute. I think I wouldn't underestimate the impact of the markets, of the election, of Brexit this year. Anyway, Pete over to you. On both the academy and the productivity point of view. Okay. The academy retention, I think can be a change journey for people, and I'll generalize it. It can take a couple of years to go from being a complete non-industry person to getting through. The future as a financial advisor is not for people. It'll be on that journey. That's why we're very careful, very diligent, very supportive of the people that go through the training program. Wanting people to be sustainable in terms of either running their own business or as an advisor inside someone else's business. We have a methodology where people move away from the SJP Academy into- ratio against the field management team, and they are then taught the real tradecraft. They're learning as a continuing thing over a number of years until they are running an absolutely sustainable business. Numbers in terms of our retention for partnership. On the productivity question, do we believe productivity of partners can get back to 2017? Talked about the volatility, about Brexit, about COVID. It has naturally had an impact on all sorts of businesses. I think one of the things that we've done really successfully through, the capacity within that, such as Ian MacKenzie has mentioned earlier on. Whilst I wouldn't want to reflect back to 2017, do I believe that we will improve productivity? Cornerstone of the strategy we've got to achieve our stated target. Yes, very, very confident. Thank you, Peter. Can we go to the next question, please? Yes. Thank you for the presentation. Three questions from me, if I may. The first one is on cost reduction and the new technology. You were mentioning, for example, that 20 more teams or whatever, this is still a very, very small proportion of your total workforce. Can we expect something more for the coming years? By that I mean, can the run rate cost, in terms of full-time employees, in terms of new recruitment necessary to support the business, or simply the business model requires and will continue to require? You clearly are focusing much more on the Academy for sustain your future growth. Is there a chance that actually you might move to slightly lower demographics historically for you? The final question, if I heard well, you say that you would be able to integrate your DFM proposition together basically with the rest in a single proposition. Thank you very much. I might take the first one on cost reduction. We were very, very clear in our strategy back in February that we would be looking to limit costs is a way that we will enable ourselves to do that whilst growing gross flows by 10% and continuing to grow the scale of the business. I'll point then go on to, I think one of the real strengths of the partnership is this broad church, if you like, the demographics of being a nationwide offering and within people who are in mainstream face-to-face advice elsewhere in the profession doesn't necessarily mean that the people that they attract to do business with St. James's Place or who graduate from the academy are graduating to our larger businesses who will have client service and measurement set up within those businesses and giving them the opportunity to record of that happening in the past. Obviously it's something we would keep a very close eye on, but no indication of that. I might just see Ian Gascoigne if there's anything he wants to add. No. Rules of age and gender. What Gardner talked earlier about taking a long-term view of things. There's a level of future-proofing and how long do they become, et cetera. This is future-proofing the business both in terms of the youth and vibrancy, but also the diversity, which will put the business- Rob here. If you remember back to my presentation where I have the proposition triangle, which has basically our core IMA, and then it has discretionary fund management and stockbroking. Our partners no longer see this as necessarily a separate proposition, but completely integrated with the way that we do business. Second, and it's probably not come out, but actually in network operating. Thirdly, the big game changer for me is the integration. If you remember, I talked about the four key ingredients to long-term success, the right people, the data and technology, the investment governance beliefs, albeit implemented in different ways. That's the whole point. We're now able to leverage the data and technology between the two businesses. This is the real opportunity. It's that ability to lead approach through DFM and stockbroking, but with a common set of people, data and technology, investment beliefs, and investment governance Nicole, can we go to the next question? I've got three questions, if I may. Firstly, on performance. Rob, I think you said there's 12 portfolios with 39 distinct funds. On comparing to inflation is not a particularly high hurdle to beat. I'd like to know really whether your funds are actually beating the competition, their world competition. Second, on client growth, Hargreaves Lansdown has grown by 210,000. It's grown at three times the rate. I just wonder, with an advice model, you are limited in terms swinging towards investing that we've seen over the last year. Finally, I think at the moment, the number of advisors per client is 192. What does it mean? What are the implications of that in terms of overall advisor growth, if you're trying to grow gross flows by 10% per annum? Okay. Thank you, Andrew. The 39 funds means that there's a lot of different choices. In July, we will be producing our BAS reports with all of our both absolute and relative funds that we relaunched last year. All three of those funds are outperforming their relative benchmark. You'll be aware that the key shift was the shift in the point. I want to go back to decades, not days. The key thing is about making sure that we have both the absolute and relative performance on a rolling 5-year and decade basis. 5, 10 years has really been momentum driven. Where we've really repositioned our IMAs to make sure that we are well exposed to the key drivers. Actually, we take U.K. equity one, whether it's a value or a growth or momentum, most of our managers have actually demonstrated by holding the course, we've done very well. I take the UK income fund, beat value manager, the market has underperformed. That highlights why we need to get this right. I would say two-thirds of our equity fund managers are outperforming on a relative basis. Everyone's going in one point and say a few things. We are of course, a different model to Hargreaves. We are vertically integrated, as I said, in my section, rather than being a platform. It is totally different. This is from the lockdown, in that a lot of people were bored staying at home and opening accounts. I'm not sure they were clients. We took prior 70,000 new clients during a lot longer term. Some people have opened an account with Hargreaves. I think they're very different. I think your third point, Andrew, was on the number of clients per advisor to Peter on that one. Yeah. Thank you, Andrew. The point Andrew makes there about the length of time that partners have been with St. James's, years and other people relatively new. The calculation of dividing the client base by the partner numbers is slightly misleading in some ways, and as far as some new people at the moment is close to 200, is the longevity of client relationships with St. James's Place, which Andrew referenced in the very early tenets of the company's design. A number of advisors who have the lifetime of that client by our ability to use our business sale and purchase agreement means that actually, yes, I do think that advisor growth will be advisor growth. Indeed, I think the important factor is the length of time that these clients spend with the organization and our ability to maintain the client's relationship. The clients under the age of one, who hopefully are going to be with us for a very long time. We have 200 clients over the age of 100. Can I ask if anyone else does have a question, please raise your hand on the chat and we'll come to you in due course. For now, can we move to Abid Hussain from Shore Capital, please. Hello. Hi. Competition in Asia differs to that here in the U.K., because in the Asian markets in Hong Kong and Singapore, you've got the large life insurers. I'm wondering, does that sort of provide you with a robust competitive landscape locally? Is that simply a case, actually, there's very limited overlap because you are focusing on- Thanks, Andrew. Thanks, Abid. I think the competition in Asia is going to be different to the competition in the U.K. That's the subject matter. Is recruit a very significant majority of the U.K. and other expat focus, effectively IFA. Now I think you're right. We're focused on a different area, particularly that pivot towards Asian high net worth families. Actually, I think the competition there, and that's where we will look to have some conversations with some of their people that might want to come and join us as partners. I think we will certainly be competing then with their front-end agents, if you like. I think that's a very different model and it's a very bancassurance product-led model, which is we're obviously an advisory-led company. Steven Haywood from HSBC have a question, please. Sorry, can you hear me? It's 2025 for the Asian business. I wonder if you have some explicit targets for the DFM business in terms of AUM expectations by 2025. Thank you That's kind of a good proxy for when we break even, but by 2025, we should be able to get to about GBP 8 billion in DFM. Hopefully that answers the question. He's raised his hand again. I have indeed. Just one final one from me. There's been quite a few questions about productivity. I would imagine you'll get a good boost as well already effectively in the system. I just really wonder if you can give an equivalent figure for investment bonds and unit trusts and ISA. How much of that would already be market linked, say? Thank you, Andrew. I'm not sure we allow double-dipping, do we, in these Q&As? I think what you're asking, Andrew, is because I've missed the question slightly. Two introductions and referrals. I would say that is indifferent across products, if that makes sense. I think you might also have been asking a question. Really how much is already in the market. I think you previously said something like around 80% for pensions. I'm just looking for an equivalent figure for other products. For pensions, Andrew, is inevitably correct because the nature of the product, particularly where you've got people mopping up all sorts of legacy investments. That's where the funds come from in terms of already invested or new money in the other products. I'm afraid that's one where we might just draw a line. Yeah. Okay, that's fine. Thank you, Andrew. Can we have the next question, please, Bob? Can we please ask Oliver Sherr from Deutsche Bank for a question? Okay. I think I'm being told there's no more questions in the queue, which is good news because it means we can be released to do the presentations and it's given you some helpful insight into the business, and also why we remain very confident about our ongoing prospects through 2025. Finally, stay safe and thank you again.

• Slides