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Information Meeting – Omers Energy

Omers Energy · Apr 1, 2014 · 44 slides

Investor presentation from the Shale Experts oil & gas presentation and slide database. Every page is imaged and its text indexed for search across operators, plays, basins and time.

Slides

  1. Information Meeting – Omers Energy – slide 1
    Thursday, April 3, 2014
  2. Information Meeting – Omers Energy – slide 2
    George Cooke Board Chair OMERS Administration Corporation
  3. Information Meeting – Omers Energy – slide 3
    AGENDA Introduction Delivering on the Pension Promise Our Strategy
  4. Information Meeting – Omers Energy – slide 4
    Michael Latimer President & Chief Executive Officer OMERS Administration Corporation
  5. Information Meeting – Omers Energy – slide 5
    Secure & Sustainable Our primary goal is to ensure that the people who serve our communities can retire securely knowing their pension will be paid
  6. Information Meeting – Omers Energy – slide 6
    65.1billion 88.2 net assets PERCENT FUNDED 6.53% gross rate of return Going the distance
  7. Information Meeting – Omers Energy – slide 7
    3.5 billion 2.9 billion in contributions from in benefits to members and members and employers in 2013 survivors in 2013 Plan to be fully funded by 2025
  8. Information Meeting – Omers Energy – slide 8
    proactive client-focused stakeholder outreach philosophy Responding to member and stakeholder needs through innovative pension services
  9. Information Meeting – Omers Energy – slide 9
    better public-private active in-house asset balance management Investment Approach
  10. Information Meeting – Omers Energy – slide 10
    focus on long-term returns Investment Approach
  11. Information Meeting – Omers Energy – slide 11
    Diversified Investment Approach OMERS OMERS OMERS OMERS OMERS INFRASTRUCTURE REAL ESTATE PRIVATE EQUITY CAPITAL MARKETS STRATEGIC INVESTMENTS toronto new york london
  12. Information Meeting – Omers Energy – slide 12
    1.3 billion 4.0 billion 65.1 billion 6.53% reduction in total investment net assets gross investment funding deficit to income (up from return 8.6 billion 60.8 billion, 2012) Financial Headlines
  13. Information Meeting – Omers Energy – slide 13
    AGENDA Review of Results Financial Position Look Forward
  14. Information Meeting – Omers Energy – slide 14
    Jonathan Simmons Executive Vice President & Chief Financial Officer OMERS Administration Corporation
  15. Information Meeting – Omers Energy – slide 15
    Review of Results
  16. Information Meeting – Omers Energy – slide 16
    Diversified returns from five investment 6.53% 6.00% entities TOTAL GROSS RETURN TOTAL NET RETURN OMERS OMERS BOREALIS OXFORD OMERS MANAGEMENT CAPITAL PRIVATE INFRASTRUCTURE PROPERTIES STRATEGIC EXPENSE MARKETS EQUITY GROUP…
  17. Information Meeting – Omers Energy – slide 17
    ONE YEAR 6.53% 4.0 billion FIVE YEAR 8.41% 21.7 billion Going the distance TEN YEAR 7.64% 34.4 billion Annualized gross return
  18. Information Meeting – Omers Energy – slide 18
    Asset Diversification 42.6% 57.4% (%) PRIVATE MARKETS PUBLIC MARKETS long-term 2007 2013 target Private Markets 29.8 42.6 47.0 Public Markets 70.2 57.4 53.0 As at December 31
  19. Information Meeting – Omers Energy – slide 19
    Qualified. 15.50% private market Experienced. rate of return Diligent. 6.24% cash return Valuation is a critical area of focus
  20. Information Meeting – Omers Energy – slide 20
    88.2 85.6 PERCENT PERCENT FUNDED FUNDED 2013 2012 1.3 billion decline in the funding deficit
  21. Information Meeting – Omers Energy – slide 21
    Total cash flows are projected to exceed benefit payments well into the 2030s
  22. Information Meeting – Omers Energy – slide 22
    Greater resilience and stability through asset diversification Focused on rigorous monitoring and transparent reporting Delivering on the pension promise 22
  23. Information Meeting – Omers Energy – slide 23
    James Donegan President & CEO OMERS Capital Markets
  24. Information Meeting – Omers Energy – slide 24
    TOTAL RETURN 0.47% Financial Results December 31, 2013
  25. Information Meeting – Omers Energy – slide 25
    Change in 7.0% - 9.0% strategy required to 1.5% - 2.5% keep meeting 5.25% the pension 0.5% 4.5% - 5.5% promise 3.5% Market return Risk-free return 1.25% 1.25% Old Portfolio New Portfolio
  26. Information Meeting – Omers Energy – slide 26
    The Old Approach Because equities are more volatile than fixed income, 40% Fixed equities dominate 60% Income 96% the risk allocation Equities Equities of the old portfolio Capital () Corresponding Risk Allocation Allocation
  27. Information Meeting – Omers Energy – slide 27
    Our New Approach A risk-balanced strategy designed to STRONG FALLING STRONG RISING GROWTH INFLATION GROWTH INFLATION perform well across Equities Nominal Bonds Equities IL Bonds a range of economic Equities Commodities conditions, not…
  28. Information Meeting – Omers Energy – slide 28
    Our research shows balance outperforms concentration over long-term 300% 300% Inflation Linked Bond Nominal Bond Equity Commodity + Gold Inflation Linked Bond Nominal Bond Equity 250% 250% 200% 200% 150% 150% 100% 100% 50% 50% 0%…
  29. Information Meeting – Omers Energy – slide 29
    Evidence-based research New portfolio demonstrated more consistent returns since 1970: One-year Five-year Ten-year periods 59% periods 66% of periods 75% of the time the time of the time
  30. Information Meeting – Omers Energy – slide 30
    New strategy enhances diversification both by markets and by asset classes Global Nominal Global Inflation Global Equities Commodities Bonds Linked Bonds Canada Aluminum Australia Copper Canada Canada Australia Germany Corn…
  31. Information Meeting – Omers Energy – slide 31
    and minimizes loss of capital during recessions
  32. Information Meeting – Omers Energy – slide 32
    Will the new portfolio strategy always perform well The new portfolio will struggle when: The economy is in There is a sharp recession unexpected spike in interest rates
  33. Information Meeting – Omers Energy – slide 33
    8.7% rate of return RISING interest rate FALLING interest rate The risk-balanced new portfolio strategy has performed well when bond yields are either rising or falling
  34. Information Meeting – Omers Energy – slide 34
    Absolute Return Portfolio 20% The absolute return Absolute strategies support greater diversification
  35. Information Meeting – Omers Energy – slide 35
    The planned absolute return portfolio can add 150 250 basis points of return Additional Alpha Portfolios Volatility Relationship High yield Activist Opportunistic strategy investment credit equity strategy
  36. Information Meeting – Omers Energy – slide 36
    The overlay program is designed to mitigate against specified risks exchange rate risk interest rate risk
  37. Information Meeting – Omers Energy – slide 37
    Our new capital markets portfolio is now designed to deliver more consistent positive returns
  38. Information Meeting – Omers Energy – slide 38
    OMERS Sponsors Corporation Update Brian OKeefe Marianne Love Co-Chairs
  39. Information Meeting – Omers Energy – slide 39
    2013 2015 2017 2019 2021 2023 2025 Plan 0 100 Sustainability -2 0.97 -4 0.93 Actuarial Funded -6 Deficit 0.90 Ratio ( billions) -8 Actuarial Deficit 0.87 Funded Ratio -10 0.84 Projection using On track to be fully…
  40. Information Meeting – Omers Energy – slide 40
    What will the future look like Everything must go consistently right Exploring options for Trigger events Little tolerance for plan design changes which indicate when contribution rate to enhance plan plan change is increases…
  41. Information Meeting – Omers Energy – slide 41
    Current Valuation Assumption Review of contribution filing review long term rates decision funding sufficient strategy Funding the Plan
  42. Information Meeting – Omers Energy – slide 42
    Annual Plan Change Cycle New for 2014 Consider changes to Communication support contribution rates and benefits SPC Timelines: PUBLISH after May 14 DECISION June 25 Plan Changes
  43. Information Meeting – Omers Energy – slide 43
    OAC director Strategic Communications appointments planning and engagement Governance
  44. Information Meeting – Omers Energy – slide 44
    Thank you for your participation We look forward to seeing you again in the fall SAVE THE DATE October 21, 2014

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