20131017 londres sp_eco_uk_en

111

Citywire Wealth Manager Retreat 201317 October 2013

222

Ed ColeAnalyst EMEA

Simon PickardHead of Emerging Markets Equities

333

Who are we?

444

Emerging markets is at the heart of our fund management

1997Carmignac Emergents

2007Carmignac

Emerging Discovery

2011Carmignac

Emerging Patrimoine

1989Carmignac Investissement

Carmignac Patrimoine

555

Carmignac Emergents: Over 16 Years of Performance, 3 Fund Management Teams

*From 01/ 01/2013 the equity index reference indicators are calculated net dividends reinvested. Past performance is not a reliable indicator of future performance and can vary over time.Source: Carmignac Gestion, 30/09/2013Basis 100 as of 03/02/1997

19971997

19981999

19992000

20012001

20022003

20032004

20052005

20062007

20072008

20092009

20102011

20112012

20130

100

200

300

400

500

600

03/02/1997 LAUNCH OF CARMIGNAC EMERGENTS

2001HIRING OF AN ANALYST

(ASIA)WEN ZHANG-GOLDBERG

HIRING OF A NEW ANALYST (ASIA)

DAVID YOUNG PARK

1997-2003

Edouard CARMIGNAC

Eric LE COZ

2003 - SEPTEMBER 2008 SEPTEMBER 2008-…

IMPLEMENTATION OF A NEW FUND MANAGEMENT

TEAMCarmignac Emergents+368,24%

MSCI EM (Eur)*

+78,63%

TEAM

Wen ZHANGGOLDBERGManager

David YOUNG PARKAnalyst

Simon PICKARD Manager

+ 4 EM Fund Managers/Analysts Xavier HOVASSEDavid YOUNG PARKHaiyan LI-LABBÉEdward COLE

OBJ

ECTI

VE Seek of a maximal performance

Growth Fund

Seek of outperformance compare to performance indicator with lower volatility Blend Fund

Seek of a maximal performanceGrowth Fund

666

A Compact, Experienced and Versatile Fund Management Team Edouard CARMIGNAC

Chairman – Fund Manager

Frédéric LEROUXGlobal Fund Manager

Laurent CHEBANIERAnalystCountry Risk

Julien CHERONQuantitative Analyst

MULTISTRATEGY

François-Joseph FURRYFund Manager

Rose OUAHBA Head of Team Fund Manager

Charles ZERAHFund Manager

Carlos Andres GALVISFund Manager

Keith NEYFund Manager

Caroline SLAMACredit Analyst

BOND MANAGEMENT

Laurent DUCOIN Head of Team Fund Manager

Samir ESSAFRIFund Manager

Markus KULESSAAnalyst

EUROPEAN EQUITIES

David FIELD Head of Team Fund Manager

Simon LOVATAnalyst

COMMODITY EQUITIES

Xavier HOVASSEFund Manager

David YOUNG PARKFund Manager

Haiyan LI-LABBÉAnalystChina and Taiwan

Simon PICKARD Head of Team Fund Manager

EMERGING EQUITIES

Matthew WILLIAMSAnalystFinancial Sector

Antoine COLONNAAnalystConsumer sector

Tim JAKSLANDAnalystInnovation Sector

Vincent STEENMANAnalystIndustry Sector

Pierre VERLÉCredit Analyst

Edward COLEAnalystEMEA

SECTOR ANALYSTS

777

Key Allocation Decisions for Emerging Markets

Consumer

Cyclical Rotation

Non-Benchmarked Financials

Latin America opportunities

Exposure Management

888

Consumer

999

Why do we think that an Emerging fund should have consumer stocks in the portfolio? Very cash generative businesses…

Source: Forbes

Name Source Country of Citizenship

1 Carlos Slim Helu & family Telecom Mexico2 Bill Gates Microsoft USA3 Amancio Ortega Zara Spain4 Warren Buffett Berkshire Hathaway USA5 Larry Ellison Oracle USA6 Charles Koch diversified USA6 David Koch diversified USA8 Li Ka-shing diversified Hong Kong9 Liliane Bettencourt & family L'Oreal France

10 Bernard Arnault & family LVMH France11 Christy Walton & family Wal-Mart USA12 Stefan Persson H&M Sweden13 Michael Bloomberg Bloomberg LP USA14 Jim Walton Wal-Mart USA15 Sheldon Adelson casinos USA16 Alice Walton Wal-Mart USA17 S. Robson Walton Wal-Mart USA18 Karl Albrecht Aldi Germany19 Jeff Bezos Amazon.com USA20 Larry Page Google USA

Amongst the 20 richest people in the world, 10

run highly cash generative consumer

companies

101010

09/0803/09

09/0903/10

09/1003/11

09/1103/12

09/1203/13

09/130%

10%

20%

30%

40%

50%

60%

Carmignac Emergents: Key Changes by the Fund Management Team

Source: Carmignac Gestion, 30/09/2008 to 30/09/2013

Change in our consumer, commodity and financial sector allocation in Carmignac Emergents

Commodities

Consumer

Finance

111111

The outperformance of our defensive stock selection…… Illustrates the value added in our stock-picking process

01/0908/09

03/1010/10

05/1112/11

07/1202/13

09/130

50

100

150

200

250

300

350

400

450

Source: Carmignac Gestion, Bloomberg, 30/09/2013

Consumer stocks in Carmignac Emergents

Consumer stocks in the MSCI Emerging

Markets

MSCI Emerging markets

Performance of Carmignac Emergents’ consumer stock selection

121212

Consumer Staples: we should not be complacent with valuations

Source: Thomson Reuters, Credit Suisse, septembre 2013

EM

Europe

US

Fd/Bev/Tob, 12m fwd P/E relative to domestic market

131313

A more balanced consumer staples portfolio

12/11 04/12 08/12 12/12 04/13 08/1325%

26%

27%

28%

29%

30%

31%

32%

33%

34%

35%

Source: Carmignac Gestion, 30/09/2013

Ambev (Brazil) CP All (Thailand) Femsa Units (Mexico) ITC (India) LG Household (South Korea) Shoprite (South Africa) United Spirits (India) Want Want China (China)

Q3 2013: stocks we have reduced

Grupo Paõ de Açucár (Brazil) Sabmiller (South Africa)

Q3 2013: stocks we have reinforced

Cosan (Brazil) Jeronimo Martins (Poland)

Q3 2013: stocks we have maintained

Evolution of the consumer staples weighting in Carmignac Emergents

141414

Cyclical Rotation

151515

Reinforcement on pro-cyclical stocks

Cyclical stocks

AUTOMATIONFanuc (Japan)

AUTOMOBILE Isuzu Motors (Japan) Hyundai Motors

(South Korea) Tata Motors (India)

LOGISTIC / TRANSPORTSGlobaltrans (Russia)

EXPORTERSEmbraer of Brazil

(Brazil)

161616

Non-Benchmarked Financials

171717

Evolution of our financial exposure over timeFrom development property companies to diversified banks


01/09

04/09

07/09

10/09

01/10

04/10

07/10

10/10

01/11

04/11

07/11

10/11

01/12

04/12

07/12

10/12

01/13

04/13

07/13

0%

5%

10%

15%

20%

25%

30%

Diversified Banks Properties

% of assets

181818

A more concentrated portfolio on financials, proof of our selectivity for countries that have not experienced the credit excesses of the 90’s


Carmignac Emergents: breakdown of financial sector

MSCI Emerging Markets: breakdown of financial sector

21% of Carmignac Emergents

22% of MSCI Emerging Markets

2.3%

13.2%

1.7%

3.7%1.4%

18.2%

0.7%

2.0%

Others*4,7%

* Others: Companies feat. Real-estate, Regional Banks, Savings and Mortgages, other diverse financial services, specialized financial institutions, Consumer Credit, Deposit Banks, Investment banking, diversified capital markets, casualty insurance, diversified real-estate activities, Residential REIR, diversified REIT

Real Estate Diversified Banks

Multisectoral Holdings Life Insurance

191919

Focus on markets where credit creation has been muted over the past 5 years

Hungary Mexico India Brazil China Russia Indonesia-10%

-5%

0%

5%

10%

15%

20%

25%

Source: Anderson, June 2013

Erste Bank

Grupo BanorteBanco Santander Mexico

Private Credit Growth (% y/y)

ICICI BankIndusInd Bank

202020

The LATAM Opportunity

212121

Amongst Emerging Markets, Latam is the big winner over the past 13 years

Source: Emerging Advisors Group, April 2013Base 100: 01/01/ 2000

Central Eastern Europe

Asia

ME/Africa

LATAM

Market performance

222222

Our positioning on Latin America in our Emerging markets Equity Funds

Source: Carmignac Gestion,30/09/2013

PERU Alicorp Inretail Peru Corp Credicorp Intergroup Financial

MEXICO Femsa Units Grupo Banorte Banco Santander TF Administrador Mexichem Promotora

CHILE Cerveceria CIA Cervecerias Unidas Embotelladora Andina

BRAZIL Ambev Cosan Grupo Paõ de Açucar CCR Ecorodovias Embraer General Shopping Brasil Rossi Residencial

Carmignac EmergentsCarmignac Emerging Discovery

COLOMBIA Almacenes Éxito Banco Davivienda Bancolombia Cementos Argos Cemex Latam Holdings Gran Tierra Energy Pacific Rubiales Energy

232323

One of our favorite markets: Colombia Benefiting from infrastructure developments…

5.8%2.2%

1.3%


Cement companies & oil

producer

Private Financial Companies

Consumer goods

Colombian stocks: 9.3% of Carmignac Emerging Discovery

Colombia: Four Lane Highways to Build (Kilometers)

Cementos Argos & Cemex Latam should benefit from a massive infrastructure spending program

announced by President Santos last year.

242424

Risk Management

252525

Carmignac Emergents: active management of our exposure

Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q308 09 10 11 12 13

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

110%


SHORT POSITIONS on Hang Seng China Enterprises, S&P

500, Bovespa, Nifty indexes…

SHORT POSITIONS on Nifty, Kospi, MSCI Taiwan semi

conductor indexes…

SHORT POSITIONS on Bovespa, Hang Seng , Kospi, Nifty, Turk ISE and Russian

index

SHORT POSITIONS on Nifty, S&P500 and MSCI Emerging

Markets indexes…

SHORT POSITIONS on Bovespa, Hang Seng , Kospi, Nifty, Turk ISE, MSCI Taiwan

index

12 3 4

5

1

2

3

4

5

262626

Improvement in the portfolio liquidity… … by refocusing on large & mid caps

04/0612/06

08/0704/08

12/0808/09

04/1012/10

08/1104/12

12/1208/13

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Large Medium Small Cash and others


MID AND LARGE CAPS INCREASE

SMALL CAPS AND CASH REDUCTION

Capitalization breakdown of Carmignac Emergents

SIMON PICKARD’S ARRIVALCARMIGNAC EMERGING DISCOVERY CREATION

272727

Carmignac Emergents: a very liquid fund


3/4 of the portfolio can be liquidated in less than 4 days

Day 0 Day 1 Day 2 Day 3 Day 4 Day 5 Day 6 Day 7 Day 80%

20%

40%

60%

80%

100%

120%

100.0%

66.6%

45.3%

32.5%24.4%

19.5% 15.7% 12.3% 9.4%

Time to liquidate 90% of the portfolio(using 30% of the 3 months average volume)

282828

Excellent Risk-Return profile of our fund range

Past performance is not a reliable indicator of future performance and can vary over time.Source: Morningstar, 30/09/2013

Performance/volatility over 5 years

17.0% 17.5% 18.0% 18.5% 19.0% 19.5% 20.0% 20.5% 21.0% 21.5% 22.0%30%

35%

40%

45%

50%

55%

60%

65%Carmignac

Emerging Dis-covery

MSCI Emerging Markets

Carmignac Emergents

Volatility

Perf

orm

ance

292929

Appendix

303030

Our strategyNon-benchmarked, discipline, expertise…

313131

Our Emerging Markets Fund Range is Simple and defined


Carmignac Emerging Patrimoine

(equity part)

Carmignac Emergents

Carmignac Emerging Discovery

No stock in common between the two

strategies

49 stocks in large/midcap strategy 62 stocks in mid/small cap and Frontier markets strategy

323232

Carmignac Emergents: A non-benchmarked approach


03/0909/09

03/1009/10

03/1109/11

03/1209/12

03/1309/13

8%

9%

10%

11%

12%

13%

14%

03/0909/09

03/1009/10

03/1109/11

03/1209/12

03/1309/13

40%

45%

50%

55%

60%

65% Active share of the Fund vs. its benchmark

Coverage of the Fund vs. its benchmark

333333

A large universe, giving us freedom We are currently invested in 33 countries


Carmignac Emerging DiscoveryCarmignac Emergents Carmignac Emergents& Carmignac Emerging Discovery

Mexico

Brazil

Colombia

Chile

Nigeria

South Africa

Czech Rep.

Turkey

Saudi Arabia

Russia

ChinaUAE

TanzaniaKenya Sri

LankaPapua New

Guinea

South KoreaAlbania

Slovenia

Poland

PhilippinesTaiwan

Vietnam

IndonesiaThailand

Peru

Israel

Mauritius

India

Malaysia

343434

Fund management with strong long-term convictions An equal-weighting discipline and a more concentrated portfolio

0-0,5 0,5-1 1-1,5 1,5-2 2-2,5 2,5-3 3-3,5 3,5-40

5

10

15

20

25

30

35

40

45

19

43

26

52

0 1 102

14

9

14

7

1 2

March 2008 September 2013


Num

ber o

f sto

cks

Weighting in the portfolio (in %)

Breakdown of the stocks weighting in Carmignac Emergents

90% of our stocks represents between 1 and

3% of the portfolio

MARCH 2008 97 STOCKS

SEPTEMBER 2013

49 STOCKS

353535

03/0609/06

03/0709/07

03/0809/08

03/0909/09

03/1009/10

03/1109/11

03/1209/12

03/1309/13

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

Commodities Financials Cyclicals Non-cyclicals

A defensive core portfolio sustained by non cyclical and quality stocks…


SIMON PICKARD’S ARRIVAL

REDUCTION OF THE

FINANCIALS AND

COMMODITIES WEIGHTING

STRONG NON-CYCLICAL STOCKS

WEIGHTING INCREASE

Sector breakdown of Carmignac Emergents

RECENT INCREASE OF OUR CYCLICAL

STOCKS

363636

2009 2010 2011 2012 2013-4%

-2%

0%

2%

4%

6%

8%

10%

12%

3.4%4.4%

5.8%7.4%

1.3%-0.6%

6.2%1.2%

-0.6%

-1.9%

Stock-Picking Geographic Allocation

Performance Attribution: Geographic Allocation vs. Stock-Picking

Past performance is not a reliable indicator of future performance. Performance may vary over time. Source: Carmignac Gestion, 30/09/2013

Carmignac Emergents: Relative performance contribution

373737

Efficient stock selection: What do we look at?

Low capital intensity (high ROIC) Cash realization ratio i.e. cash flow well in

excess of net income…

Adjusted FCF yield i.e. after maintenance, not total capex

Intense focus on profitability Sensible funding and capital management High levels of equity ownership

management/staff …

PER vs. diluted EPS growth and vs. market Price to Book Value vs. ROE and BVPS growth DCF for high growers; cash diluted yield…

High grade deposits Infrastructures…

EV and Capex remaining / Ebitda P/NPVs (especially for the gold space)…

Net Working Capital Patents Competitive edge and its sustainability…

FCF generation Price to Book

Selected qualitative criteria Selected valuation measures

CONSUMER

FINANCIALS

COMMODITIES

TECHNOLOGY

383838

CARMIGNAC EMERGENTS

Simon PICKARD

Past performance is not a reliable indicator of future performance. Performance may vary over time. Source: Carmignac Gestion, 31/08/2013; Base 100: 31/08/2010

A Core – Satellite approach

A large and mid cap fund: average weighted market cap of EUR19.3bn

Assets: 1710.01 Million €

50 holdings

* The fund performance indicated is based on the A EUR acc Share Class** From 01/01/2013, the equity index reference indicators are calculated net dividends reinvested.

Carmignac Emergents*

+4.99%

MSCI Emerging Markets**

-5.84%

08/1011/10

02/1104/11

07/1110/11

12/1103/12

06/1208/12

11/1201/13

04/1307/13

80

90

100

110

120

130 Performance over 3 years

393939

Main movements in the portfolio Our strong geographic diversification: our frontier markets exposure

404040

CARMIGNAC EMERGING DISCOVERY

Past performance is not a reliable indicator of future performance. Performance may vary over time. Source: Carmignac Gestion

Carmignac Emerging Discovery(1)

1.00%

Reference indicator(2)

-9.44%

David Park

Xavier Hovasse

A “frontier” markets exposure

A small and mid cap fund: average weighted market cap of EUR3.3bn

Assets : 312.49 Million €

62 positions

(1) The fund performance indicated is based on the A EUR Acc Share Class(2) 50% MSCI EM Mid Cap NR (EUR) + 50% MSCI EM Small Cap NR (EUR))

09/10 03/11 09/11 03/12 09/12 03/13 09/1370

80

90

100

110

120 Performance over 3 years

414141

5.4%

3.8%

12.5%

Carmignac Emerging Discovery: Geographic Diversification Giving Access to Frontier Markets

(1) South Africa, Singapore, South Korea, Taiwan(2) Albania, Papua New Guinea, Slovenia, Sri Lanka, Vietnam, United Arab Emirates(3) Kenya, Nigeria, Mauritius,TanzaniaSource: Carmignac Gestion, 30/09/2013

Carmignac Emerging Discovery: Geographic Breakdown

Brazil, China, India22% Traditional markets

33%

3.6%

1.2%

2.5%3.2%

3.8%

18.6%

Frontier markets40%

9.3%

7.0%

7.5%

5.2%

3.1%

7.9%

ChinaIndia

Brazil

Others (1)

ThailandChile

IndonesiaTurkey

MexicoPhilippines

ColombiaOthers(2)

AfricaPeru

Saudi Arabia

Liquidity: 5% of the fund

424242

Carmignac Emerging Discovery: a very liquid fund


Day 0Day 1

Day 2Day 3

Day 4Day 5

Day 6Day 7

Day 8Day 9

Day 10Day 11

Day 12Day 13

Day 14Day 15

Day 16Day 17

0%

20%

40%

60%

80%

100%

120%

100.0%

75.9%

56.4%

44.0%

36.0%30.6%

26.2%22.3% 19.4% 17.4% 15.8% 14.5% 13.4% 12.5% 11.6% 10.8% 10.2% 9.5%

2/3 of the portfolio can be liquidated in less than 5 days

Time to liquidate 90% of the portfolio(using 30% of the 3 months average volume)

434343

Over the last 12 months, Frontier Markets offered better return than traditional markets

Source: Emerging Advisors Group, October 2013

Saud

i Ara

bia

Pola

ndPh

ilipp

ines

Hon

g Ko

ngTh

aila

ndIs

rael

Chin

aSo

uth

Afric

aTa

iwan

Turk

eyM

alay

sia

Sout

h Ko

rea

Sing

apor

eCo

lom

bia

Czec

h Re

p.Ru

ssia

Mex

ico

Hun

gary

Indo

nesi

aIn

dia

Chile

Braz

ilU

AEAr

genti

naBu

lgar

iaU

rugu

ayPa

kist

anN

iger

iaRo

man

iaEs

toni

aSe

rbia

Viet

nam

Latv

iaKe

nya

Mau

ritius

Qat

arLi

thua

nia

Pana

ma

Kuw

ait

Tanz

anie

Slov

enia

Ecua

dor

Jord

anie

Sri L

anka

Bosn

iaKa

zakh

stan

Tuni

sia

Egyp

tU

krai

nePe

ru

Large vs. small market returns12-month equity performance (national index, USD terms)

444444

Frontier Markets: Still Undiscovered

Source: Datastream, IMF, Citigroup, September 2013

Developed Markets

Emerging Markets

Frontier Markets

Market cap/GDP ratios (since 1988)

454545

The increase of our Frontier Market exposure

01/08

05/08

09/08

01/09

05/09

09/09

01/10

05/10

09/10

01/11

05/11

09/11

01/12

05/12

09/12

01/13

05/13

09/13

0%

20%

40%

60%

80%

100%

Frontier BIC Traditional


Breakdown of Carmignac Emerging Discovery

464646

This presentation has been conceived for information purposes only and is intended to professional clients. It cannot be used for another purpose than the one it has been conceived for, and cannot be reproduced, distributed or communicated, partly or entirely, to third parties without prior written approval from Carmignac Gestion. This presentation is not an investment advice nor is it contractually binding. Due to their simplification, the information contained in this presentation are inevitably partial. This document may be subject to changes, without prior notice.

Past performance does not guarantee future returns. The value of an investment can rise or fall with market fluctuations, and shareholders may lose, as the case may be, the amount originally invested. The fund performance indicated is based on the A EUR acc Share Class. Fees are included in the performance.

The access to the products and services described in this presentation may be subject to restrictions towards some persons or countries.

The risks and fees relative to the products are described in the KIID (Key Investor Information Document).

The UCITS Funds presented in this presentation are authorized for distribution in the United Kingdom by the FCA. The Prospectus and KIID as well as annual reports of the UCITS Funds can be obtained free of charge from the Carmignac Gestion Luxembourg London Branch at: No. 29 Cornhill - LONDON EC3V 3NF

The KIID must be given to the investor before any investment.

Copyright : The data published in this presentation are the exclusive property of their owners as mentioned on each slide.

Non contractual document, redaction achieved on 14/10/2013Carmignac Gestion – Société Anonyme au capital de 15 000 000 € - RCS de Paris B 349 501 676

Agrément AMF n° GP 97-08 du 13/03/1997 24 Place Vendôme – 75001 Paris – Tel : +33 1 42 86 53 35

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Economy & Finance