ASI PowerPoint Template A4 - RankiaPro · companies, analysing ESG risk and opportunities within every company stock note -desk ESG Specialists • On-desk pre-investment due diligence

October 2019

European Equities Europe: a perfect market for stockpickers

For Professional Investors Only – Not for public distribution. In Switzerland for Qualified Investors only.

Ben Ritchie, CFA, Head of European Equities

CFA ® and Chartered Financial Analyst ® are trademarks owned by the CFA Institute

1

Welcome contrarians!

Source: Bloomberg, Thomson Reuters Datastream

Europe ex UK positioning is materially underweight

European equity underweight is consensual

1.7

- 0.6 - 0.7 - 0.7

- 1.5

-2.0

-1.5

-1.0

-0.5

0.0

0.5

1.0

1.5

2.0

US UK EM Japan Europe ex UK

Z score of Regional funds positioning (MFs & ETFs)

2

Outflows have accelerated

Source: EPFR

Regional cumulative equity flows since 2016 ($bn)

Since the start of 2018 over $150bn has left European equities

-300

0

100

300

18 17 16 19

200

-200

-100

US Europe Europe exUK UK Japan Global EM

3

Sentiment tends to be closely correlated with market performance

Source: BofA Merrill Lynch Global Fund Manager Survey

Fund Manager Survey intention to own EU stocks at 6y-lows

Investors tend to follow rather than anticipate

07 08 09 10 11 12 13 14 15 16 17 18 19

-40

-20

0

20

40

60

-60

-40

-20

0

20

40

60

Eurostoxx 50 (%YoY, rhs) % Net would overweight Europe (3m mva)

4

An uncertain political environment

Source: Haver Analytics, national sources, Morgan Stanley Research

Global trade volume has reached the lowest point

since 2012

Source: Baker, Bloom & Davis, Bloomberg, UBS European Equity Strategy

Global: Policy uncertainty

Driving lower trade activity

0

50

100

150

200

250

300

350

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

2016

2017

2018

2019

7%

6%

5%

4%

3%

2%

1%

0%

-1%

Jun-11 Jun-12 Jun-13 Jun-14 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19

World Trade Volume proxy %Y, 3MMA

5

Economic conditions in Europe have deteriorated

Source: BofA Merrill Lynch Regional Fund Manager Survey

European recession expectations


European economic growth expectations

Recession risks have risen

Net % Expecting Recession – Europe Net % Expecting Stronger Economy – Europe

100

80

60

40

20

0

-20

-40

-60

-80

-100

06 07 08 16 18 19 17 15 14 13 12 09 10 11

-100

-80

-40

-20

20

40

60

100

-60

0

80

94 96 98 00 02 04 06 08 10 12 14 16 18

6

Earnings expectations for the market are likely too high

Source: MSCI, IBES, Morgan Stanley Research

MSCI Europe calendar year consensus EPS estimate revisions through the year

Analysts tend to be too optimistic

% C

han

ge in

MS

CI E

uro

pe C

on

sen

su

s

EP

S T

hro

ug

h C

ale

nd

ar

year

0

-2

-4

-6

-8

-10

-12

Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec

Last 10Y Median Full History Median 2019

7

European equities are very cheap compared to other asset classes

Source: BofA Merrill Lynch European Equity and Quant Strategy, GFD, Bond Yield = Avg of

UK, Germany, France

European equity vs bond yield gap is at its widest in

~100 years

Source: BofA Merrill Lynch European Equity and Quant Strategy, Thomson Reuters

Datastream

European stocks are trading near 50-year lows to

global stocks

Cheap versus other equity markets and credit

70 74 78 82 86 90 94 98 02 06 10 14 18

0.7

0.8

0.9

1.0

1.1

1.2

1.3

1.4

Europe vs Global Equities (Perf. In US$)

24 29 34 39 44 49 54 59 64 69 74 79 84 89 94 99 04 09 14 19 -9

-8

-7

-6

-5

-4

-3

-2

-1

0

1

2

3

4

EU Equities Dividend Yield minus 10Y European Bond Yield

8

But Europe always perceived as a cheap market


Perception of European equity valuation

An argument in favour needs more than headline multiples

-80

-60

-40

-20

0

20

40

60

98 00 02 04 06 08 10 12 14 16 18

Net % Say Equities Overvalued – Europe

9

So why European Equity? – complexity brings opportunity

All of which make Europe a rewarding market for stock-pickers seeking great investments

Source: Aberdeen Standard Investments

Deep and liquid market Global leading brands and

technology Highly developed IP

Modest economic

growth

Strong corporate

governance

EPS growth ≠ GDP

growth

Heterogeneous politics

and cultures Skilled human capital International expertise

10

• Europe is a perfect market for

active stock pickers

• A deep and liquid market

• A misunderstood market

• A complex market

European Equities at ASI

Research-driven, high conviction active investing in Europe

Why European Equities Why ASI for European

Equities European Equity Franchise

• Exceptionally well-resourced,

experienced, dynamic team

• World class proprietary research

platform

• ESG at the heart of our investment

process

• Supporting a comprehensive suite

of highly active products

• High Active

• Long Term Quality

• Focus on Change

• Income

• Defensive Income

• Income

• Values Led

• Ethical

Compelling investment

opportunities

A team with best in class

capabilities

Delivering differentiated

outcomes

11

European Equity Capability

Well positioned to take advantage

Fund: Aberdeen Standard SICAV I European Equity Fund. Benchmark: FTSE World - Europe.

Source: Aberdeen Standard Investments, 31 July 2019. Performance is shown gross of fees and does not reflect investment management fees. Had such fees been deducted, returns would have

been lower.

*Past performance is not a guide to future results

European Equity Team

• 16-strong team with experience across market cycles

• Dynamic coverage of the entire market

• Research platform drives multiple client outcomes

• ESG at the heart of our investment process

Aberdeen Standard SICAV I European Equity Fund

• Quality focus delivers a lower risk proposition

• Growth, returns, and leverage characteristics

• High active share and high tracking error gives potential to

meaningfully outperform

Long Term Quality European Portfolio Construction

• Focused on high quality companies

• Bottom up, highly active, conviction led

• Concentrated best ideas portfolio of 30-40 holdings

Building a strong track record*

-20.00

-10.00

0.00

10.00

20.00

30.00

2019 YTD 2018 2017 2016

Fund Benchmark

12

Aberdeen Standard SICAV I - European Equity Fund

Core pod of three decision makers on the fund

Clear accountability within a team framework


• Aberdeen Standard SICAV I European Equity Fund is managed by Ben Ritchie, Jonathan Allison and Sanjeet Mangat

Sanjeet Mangat

Investment Director

Jonathan Allison

Investment Director

Ben Ritchie

Head of Europe

13

We focus on the best businesses in Europe


Good margins &

returns on capital

Profitable

growth

Attractive

industry

characteristics

Sustainable

competitive

advantage

Strong balance

sheet

Management

pedigree

Corporate

governance and

stewardship

Quality

Execution and

track record

Why does Quality Investing Work? • We believe that the market systematically underestimates the sustainability of returns from high quality companies

• Quality companies have fewer tail risks and a greater margin of safety

• Quality companies produce less volatile earnings streams; earnings are more resilient and sustainable

• Quality companies can better navigate an uncertain future and capitalise on opportunities to create value

What do we mean by Quality?

• Durability of the business model and moat

• Attractiveness of the industry

• Strength of financials

• Capability of management

• Assessment of ESG risks

14

ESG at the heart of our investment process

Investing for a better future

Our primary goal is to generate the best long-term outcomes for our clients

Source: Aberdeen Standard Investments, March 2019

Understanding ESG risks and

opportunities alongside other financial

metrics allows us to make better

investment decisions

Informed and constructive

engagement helps foster better

companies, protecting and enhancing

the value of our clients’ investment

ESG factors are financially material,

and impact corporate performance

Investment

Managers

• ESG assessment of

companies, analysing

ESG risk and

opportunities within

every company stock

note

On-desk ESG

Specialists

• On-desk pre-

investment due

diligence and focused

ESG company

analysis

• Ongoing engagement

with portfolio

companies

Central ESG

• 20 experienced ESG specialists

• Research on global ESG topics and impact on investments

• Conducting active stewardship through voting and engaging

to influence change on behalf of shareholders

15

AS SICAV I - European Equity Fund top 10 holdings

Market leading franchises

Companies selected for illustrative purposes only to demonstrate Aberdeen Standard Investment’s investment management style and not as an investment recommendation or indication of future

performance.

Source: Aberdeen Standard Investments, 31 August 2019

Company name Country Sector % Market Leader

LSE United Kingdom Financial Services 5.1 Stock Exchange

Heineken Netherlands Beverages 4.9 Beer

Novo-Nordisk Denmark Pharmaceuticals 4.2 Diabetes Care

Deutsche Boerse Germany Financial Services 4.1 Stock Exchange

Kerry Ireland Food Producers 4.1 Taste & Nutrition

Nestle Switzerland Food Producers 4.0 Nutrition

Essilor Luxottica France Manufacturer 3.8 Optical Lenses

Amadeus Spain Software and Computer Services 3.6 Travel Software

Pernod-Ricard France Beverages 3.4 Spirits

Croda United Kingdom Chemicals 3.4 Specialist Chemicals

16

Heineken Investment Case

© owned by each of the corporate entities named in the respective logos. Companies selected for

illustrative purposes only to demonstrate Aberdeen Standard Investments’ investment management

style and not as an investment recommendation or indication of future performance.

Source: Aberdeen Standard Investments, Heineken Website, Bloomberg

Investment Insight

The significant derating of the shares suggests that the market is being too short-

sighted and extrapolating issues that should be transitory. Longer term, the

business continues to be a good investment as fundamentals remain resilient

and the wider beer market continues to be an attractive industry in which to

operate.

Business Fundamentals and Key Drivers

Heineken is the world’s second largest brewer with a well diversified portfolio of

brands, built on the premium Heineken brand, and an attractive regional footprint.

The business is in a very strong position given their scale and positioning in

structurally attractive markets, alongside a solid balance sheet.

Financials and Valuation

Recent M&A has led to issues with group profitability and this, coupled with

concerns over the competitive landscape within the wider beer industry, has led

to a contraction in the company’s valuation. This has left Heineken trading at a

discount to the wider beverages sector.

A strong beer portfolio with significant premium exposure

Margin pressure should be temporary in nature

Fundamentals 2019e 2020e 2021e

Sales % YoY 6.3% 4.5% 4.7%

EPS % YoY 11.2% 7.9% 7.4%

PE (x) 21.3 19.7 18.4

EV/EBIT (x) 16.1 14.9 13.5

FCF % Yld 3.7% 4.7% 5.1%

Div % Yld 1.8% 1.9% 2.1%

Consensus Expectations

17

AS SICAV I - European Equity Fund

Source: Aberdeen Standard Investments, 31 March 2019

0.78 0.80 0.82 0.84 0.86 0.88 0.90 0.92 0.94 0.96 0.98

Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19

Sub €10bn Allocation

Beta


74%

79%

84%

89%

94%

Sep 16 Mar 17 Sep 17 Mar 18 Sep 18 Mar 19

Active Share

Volatility vs Market

30%

35%

40%

45%

50%

Sep 16 Mar 17 Sep 17 Mar 18 Sep 18 Mar 19

10.0

12.0

14.0

16.0

18.0

20.0

Dec 15 Jun 16 Dec 16 Jun 17 Dec 17 Jun 18 Dec 18

Portfolio Benchmark

Quantitative demonstration of portfolio quality and differentiation

18


Highly differentiated to the Benchmark / Reference Index

Meaningful risk control while retaining flexibility to express conviction

Source: Aberdeen Standard Investments (APT Analysis), 31 August 2019

Parameter Guidelines

Benchmark / Reference Index FTSE World Europe Index

Relative Limits

• Stock

• Sector

• Country

+/-5%

+/-10%

+/-15%

Number of holdings 30 – 75 (target range 30-50)

32 holdings as at end July 2019

Tracking Error 3 - 9%

Structure SICAV (Fund size: 196,585,223 euro)

Strategy characteristics Strategy Benchmark / Reference

Index

Market capitalisation (w. avg) €48.3bn €63.5bn

Price / earnings (FY2) 22.8x 12.8x

Historic 3yr EPS growth 13.6% 9.2%

Return on equity (5 year) 24.7% 18.8%

Long term debt / equity 0.79x 1.20x

Beta (ex-ante) 0.85 -

Portfolio volatility 11.3% 11.8%

Active share 86.2% -

Tracking error (ex-ante) 5.4% -

Holdings by Market Cap

(EUR) Portfolio (%)

Benchmark / Reference

Index (%)

Small (<2.5bn) 0.0 0.6

Mid (2.5bn to 10bn) 26.4 16.2

Large (> 10bn) 73.6 83.2

• A higher p/e than the market BUT

• Return characteristics of the portfolio are superior to the Benchmark /

Reference Index

• Historic earnings growth is ahead of the Benchmark / Reference Index

• Balance sheet strength provides greater resilience and resources to

reinvest back into the businesses

19

AS SICAV I - European Equity Fund asset allocation

Sector – Absolute Weights


Oil & Gas

Financials

Utilities

Telecommunications

Basic Materials

Industrials

Consumer Services

Health Care

Consumer Goods

Technology

-15.00 -10.00 -5.00 0.00 5.00 10.00 15.00

Country – Absolute Weights

3.4

6.5

12.1

14.6

15.7

16.7

26.9

Basic Materials

Consumer Services

Industrials

Financials

Technology

Health Care

Consumer Goods

0.0 5.0 10.0 15.0 20.0 25.0 30.0Basic Materials Consumer Services Industrials Financials Technology Health Care Consumer Goods

Sector – Relative Weights


Country – Relative Weights

Source: Aberdeen Standard Investments, 31 August 2019 Source: Aberdeen Standard Investments, 31 August 2019

Overweight / Underweight positions

1.9

3.6

4.0

4.1

6.2

12.2

13.4

14.4

15.3

21.0

Sweden

Spain

Italy

Ireland

Denmark

Germany

Switzerland

Netherlands

France

UK

0.0 5.0 10.0 15.0 20.0 25.0

Sweden Spain Italy Ireland Denmark Germany Switzerland Netherlands France UK

UK Sweden Finland France Belgium

Switzerland Germany

Norway Spain

Poland Turkey Austria

Portugal Greece Hungary

Czech Republic Italy

Denmark Ireland

Netherlands

-9.00 -7.00 -5.00 -3.00 -1.00 1.00 3.00 5.00 7.00 9.00

20

Global revenue growth has sharply declined

Source: Thomson Reuters Datastream, Worldscope, Goldman Sachs Global Investment Research

There has been a dramatic decline in growth

10-year rolling average sales growth, by region. Local currency, World in USD

Sustainable growth becomes even more prized

0%

6%

10%

12%

16%

17 15 13 09 07 01 99 95 91 19 97

14%

2%

4%

8%

US Europe World

93 11 05 03

21

Bond yields have collapsed

Source: J.P. Morgan

% of global investable DM and EMU bond universe with negative yields

Making sustainably growing cash flows even more attractive

Negative Yields GBI-DM % Negative Yields EMU %

0%

30%

40%

60%

18 17 16 15 14 13 12 19

50%

10%

20%

22

Fewer companies with high sales or earnings growth

Source: IBES, Thomson Reuters Datastream, Goldman Sachs Global Investment Research,

Sep 18

Few companies generate high bottom-line growth

Source: IBES, Thomson Reuters Datastream, Goldman Sachs Global Investment Research,

Sep 18

Few companies generate high top-line growth (%)

But plenty of opportunities remain for the stockpicker

% of companies with high expected Sales growth in FY3

50

40

30

20

10

0

98 00 02 04 06 08 10 12 14 16 18

MSCI AC World SXXP MSCI AC World SXXP

% of companies with high expected EPS growth in FY3

50

40

30

20

10

0

98 00 02 04 06 08 10 12 14 16 18

High Earnings Growth (>15%) High growth (>8%)

13%

24%

15%

21%

23

• Macro factors matter but we want to invest in companies whose fortunes are not tied to European GDP

• European nominal GDP growth rates of c. 3.5% p.a. compared to portfolio FCF growth of 7.8% p.a. and net income growth 9% p.a.

over the same period

Our portfolio companies have better growth potential

“Much more than macro and the market”

Portfolio illustrated: Aberdeen Standard SICAV I – European Equity Fund

Source: Aberdeen Standard Investments/Bloomberg January 2019

100

150

200

250

300

350

400

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017

European GDP (EUR m) Portfolio FCF (EUR m) - ex financials Net Income (EUR m)

24

Sustainable growth is at a premium valuation

Source: MSCI, IBES, Thomson Reuters Datastream, Haver Analytics, National Bureau of Economic Research, Morgan Stanley Research

Absolute PE of MSCI Europe Growth index is high but not extreme versus history

But not that expensive relative to history

4

8

12

20

28

36

40

74 78 82 86 90 94 98 02 06 10 18

MS

CI E

uro

pe G

row

th –

PE

14

MSCI Europe Growth PE NBER Recession Periods

32

24

16

25


Performance to 31 August 2019

Past performance is not a guide to future results Inception: 31 January 1993. Benchmark / Reference Index: FTSE World Europe

Source: Aberdeen Standard Investments, BPSS, Thomson Reuters Datastream, Lipper EUR

Performance is shown gross of fees and does not reflect investment management fees. Had such fees been deducted, returns would have been lower

EUR Annualised (%)

Year to date 1 year 3 years 5 years

Aberdeen Standard SICAV I - European Equity Fund 26.31 6.29 11.55 7.08

FTSE World Europe 15.39 2.84 6.86 5.34

Difference +10.92 +3.45 +4.69 +1.74

Quartile 1 (Top Decile) 1 (Top Decile) 1 (Top Decile) 1

EUR 2018 2017 2016

Aberdeen Standard SICAV I - European Equity Fund -6.92 13.61 3.78

FTSE World Europe -10.39 11.38 3.15

Difference +3.47 +2.22 +0.62

26

• Repositioning of the strategies towards the end of 2015 has proven extremely successful

• Top quartile performance over 1, 3 and 5 years

• Leveraging the resources of an exceptionally well equipped European equity team

• A highly active proposition from managers who behave as engaged long term owners of businesses

• ESG at the heart of our investment process

• The hope of a resolution to political challenges and looser monetary policy has driven equity markets back towards multi year highs.

However, trade tensions remain elevated and the negative impact on the global economy is increasingly evident

• Such an environment favours a focus on quality companies which can offer both resilience to volatility and participate in the available

growth opportunities

• We remain positive on our portfolio’s long term prospects and will continue to seek to take advantage of opportunities that may arise

from volatile markets

Summary and outlook


Appendix

28

Why ASI for European Equities

Equity AuM £121 billion*

Please note that Small Cap is Focus on Change and Long Term Quality (LTQ) is managed within the

regional teams.

* Equities AUM is post subcontract and includes allocations from Multi-Asset division to Equities.

Source: Aberdeen Standard Investments, 30 June 2019

• Exceptionally well resourced, experienced and dynamic team

• Proprietary cross asset class research platform delivers

insights through a rigorous fundamental approach and broad

market coverage

• ESG analysis and active stewardship at the heart of our

investment process enhances risk-adjusted returns

• Truly active equity investing which targets strong returns

across a broad range of client outcomes

Research driven, high conviction investing in Europe

Emerging Markets Equities

27%

Asian Equities 20%

UK Equities 20%

Global / EAFE Equities

12%

North American Equities

9%

European Equities 8%

Small Cap Equities 5%

Japanese Equities 5%

29

European Equity Team

Source: Aberdeen Standard Investments, 30 July 2019

* London Based

Head of Europe

Stan Pearson

Ben Ritchie* (Autos)

Head of Europe

Investment Director

Jonathan Fearon (Banks, Diversified Financials)

Tom Dorner (Insurance)

Sarah Norris (Healthcare equipment, IT services/payments,

software)

Investment Manager

Angus Tester* (Industrial engineering, Ingredients)

Investment Analyst

Jamie Mills-O’Brien* (Energy services & Renewables, internet, oil & gas

producers, Technology hardware & equipment)

Investment Director

Ian Hewett* (Luxury & personal goods, telecoms)

Jonathan Allison (Media, travel & leisure)

Stuart Brown (Electronic & electrical equipment, general

industrials, utilities)

Investment Analyst

Sasha Kachanova* (Construction & materials, food & drug retailers,

forestry & paper, household goods)

Will James

(Banks, chemicals)

Deputy Head of Europe

Kay Eyre (Construction & building, food producers))

Senior Investment Director

Investment Director

Kurt Cruickshank* (Aerospace & defence, utilities, business & support

services)

Sanjeet Mangat* (Pharmaceuticals & biotech, real estate)

Investment Analyst

Roseanna Ivory* (Beverages & tobacco, general retailers, industrial

metal & mining, transportation)

ESG Analyst

Rosie French*

30

European Equities investment process

Our research drives performance

Deep Fundamental Analysis

• Common investment language

• Fully embedded ESG

• Clear non-consensus insights

• Continuous review of outputs

Broad Universe

• Wide & dynamic opportunity set

• Deep sector expertise

• Quant tools refine coverage

• Outstanding corporate access

Rigorous Team Debate

• Informed peer review of insights

• Collaboration on sectors & themes

• Cross asset class insights

• Winners list ranks ideas

Focused on Client Outcomes

• Pods drive clear accountability

• Bottom up, best ideas led

• Quant and risk analytics

• Effective diversification

Comprehensive independent oversight of investment process and client mandate parameters

Portfolio construction Peer review Research Idea generation

31

Idea Generation - Broad universe and proactive engagement

• Fundamental research platform providing deep company level insights

• Broad and dynamic opportunity set; quant tools support and refine coverage

• Outstanding corporate access a primary source of insights for our equity teams

Research - Deep company level analysis delivers insights

• Globally consistent approach and common language delivers actionable insights

• ESG analysis fully embedded in all our company assessments

• Sector analysis provides deeper knowledge and insights into companies

Peer Review - Conviction developed through rigorous team debate

• Informed peer review of insights builds conviction

• Broad team company knowledge strengthened through effective team debate

• Clear team and individual responsibilities ensure collaboration and accountability

Equity Research

Source: Aberdeen Standard Investments. Combined number of company meetings held in 2018 by both heritage firms

Foundations Business Fundamentals

Evaluation of ESG risks and opportunities

Dynamics Key drivers of change in the business that

influence corporate value

Financials and valuation

Financial analysis and assessment of market

expectations

Investment Insight

Investment thesis and non-consensus insights;

risk factors & downside scenarios

Stock Research Note

32


L’Oreal is the world’s largest cosmetics and beauty company. It is a high quality

business with a strong portfolio of global brands, sector-leading innovation, dominant

market share and a consistent growth track record.


L’Oreal is valued at a premium to its immediate peer group. However, we believe this is

warranted given it has one of the strongest balance sheets in the sector and the quality

of its brand portfolio means that growth should surpass that of its peers.

L’Oreal Investment Case

© owned by each of the corporate entities named in the respective logos. Companies selected for illustrative

purposes only to demonstrate Aberdeen Standard Investments’ investment management style and not as an

investment recommendation or indication of future performance.

Source: Aberdeen Standard Investments, L’Oreal company presentation, Bloomberg


Sales % YoY 9.0% 5.6% 5.5%

EPS % YoY 10.6% 7.4% 6.7%

PE (x) 30.5 28.4 26.6

EV/EBIT (x) 23.6 21.6 19.8

FCF % Yld 3.0% 3.3% 3.5%

Div % Yld 1.8% 1.9% 2.1%

L’Oreal’s comprehensive portfolio of global brands

Supports consistent earnings growth over the long-term

Consensus Expectations

Investment Insight

In fading return expectations too quickly, the market fails to appreciate the

underlying quality of L’Oreal’s brand portfolio. The business is well positioned for

growth wherever it may emerge and its dominant market positioning creates

barriers to entry that will enable returns to persist longer than anticipated.

33

Kerry Investment Case

© owned by each of the corporate entities named in the respective logos. Companies selected for

illustrative purposes only to demonstrate Aberdeen Standard Investments’ investment management

style and not as an investment recommendation or indication of future performance.

Source: Aberdeen Standard Investments, Kerry Website, Bloomberg

Investment Insight

The discounted valuation fails to appreciate both the margin potential of the

business and the stability of growth that will come from Kerry’s holistic product

offering.


Kerry is an Irish ingredients company who provides essential ingredient

solutions to a variety of food producers. This is a high quality business which

operates in an attractive market, as there are multiple growth opportunities

and high barriers to entry which stem from technological excellence and

intimate customer knowledge.


Kerry is valued at a discount to its immediate peer group. However, we believe

this gap should narrow over time as Kerry demonstrates the resilience of their

operating model, successfully integrates acquisitions, and improves

profitability to peer levels.

Kerry has a substantial margin opportunity relative to peers

And has delivered resilient volume growth through the cycle


Sales % YoY 9.1% 4.4% 5.6%

EPS % YoY 16.0% 9.0% 9.8%

PE (x) 27.3 25.0 22.8

EV/EBIT (x) 23.6 21.2 19.4

FCF % Yld 2.5% 3.4% 3.7%

Div % Yld 0.7% 0.8% 0.9%

34

ASI Pan European Equity - sector coverage

Pan European Portfolio managers, * UK Equity Team


Team Member Sectors

Ben Ritchie Head of European Equities, Autos

Frederik Nassauer* General Retail

Iain Pyle* Oil & Gas Producers, Oil Equipment, Services & Distribution, Banks

Jonathan Allison Media, Travel & Leisure

Sanjeet Mangat Pharmaceuticals & Biotech, Real Estate

Tom Dorner Insurance

Andrew Hunt* Food & Drug Retail, Pubs, Non Life Insurance , Mining

Andrew Millington* Telecoms, Water

Angus Tester General Financials, Industrial Engineering

Charles Luke* Business Support Services, Gas & Electricity, Health Equipment & Services

Georgina Cooper* General Retail, Beverages, Construction & Materials

Guy Douthwaite* Industrial Engineering & General Industrials, Precious & Industrial Metals, Paper, Leisure

Ian Hewett Luxury & Personal Goods, Telecoms

Jamie Mills O’Brien Oil & Gas Producers, Energy Services & Renewables, Internet

Jonathan Fearon Banks

Kay Eyre Construction & Materials, Food Producers

Kurt Cruickshank Aerospace & Defence, Business and Support Services, Utilities

Lesley Duncan* Support Services, Household Goods

Louisa Kernochan* Pharmaceuticals, Electronics, Industrial Transport and Autos

Nick Machin* Travel, Hotels, Real Estate

Pete Silver* ESG

Rebecca Maclean* Aerospace & Defence, Software, Chemicals, Tobacco, Outsourcers

Rhona Millar* Life Insurance, Exchanges

Romney Fox* Real Estate, Food Producers

Roseanna Ivory Beverages & Tobacco, General Retailers, Industrial Metals & Mining, Industrial Transportation

Rosie French ESG

Sarah Norris Healthcare Equipment & Services, Software, IT Services & Payments

Sasha Kachanova Construction & Materials, Food & Drug Retailers, Forestry & Paper, Household Goods

Stuart Brown Electricals & Electrical Equipment, General Industrials, Utilities

Thomas Moore* General Financials, Private Equity

Wes McCoy* Media, Gambling

Will James Banks, Technology Hardware & Equipment

Aberdeen Standard SICAV I - European Equity Fund

36

Bottom stock

contributors

Relative

position

%

Contribution

%

Nestle +0.2 -0.7

Croda +3.3 -0.6

Prudential +1.9 -0.3

Weir -0.1 -0.3

Abcam +2.6 -0.3

Grandvision -0.0 -0.3

Novozymes +1.9 -0.3

Brunello Cucinelli +0.0 -0.3

Novartis -2.2 -0.3

Lvmh Moet Hennessy -1.1 -0.3

AS SICAV I - European Equity Fund stock attribution

Year to date to 31 August 2019

Benchmark / Reference Index: FTSE World Europe

Source: Aberdeen Standard Investments, BPSS, Thomson Reuters Datastream, EUR, 31 August 2019

Performance is shown gross of fees and does not reflect investment management fees. Had such fees been deducted, returns would have been lower.

Past Performance is not a guide to future results.

Top stock

contributors

Relative

position

%

Contribution

%

LSE +4.8 +1.9

Edenred +2.0 +1.3

Amplifon +2.1 +1.3

Aveva +2.0 +1.0

Hannover Rueck +2.6 +0.7

Pernod Ricard +1.9 +0.6

Heineken +2.1 +0.6

Experian +3.3 +0.5

Essilor Luxottica +3.8 +0.5

Deutsche Boerse +4.6 +0.5

37

Bottom stock

contributors

Relative

position

%

Contribution

%

Nestle +0.2 -0.9

Weir -0.1 -0.8

Amaedue IT +3.2 -0.6

Prudential +1.9 -0.6

Novartis -2.2 -0.6

Julius Baer -0.1 -0.5

Schoeller-Bleckmann +0.0 -0.5


British American Tobacco -0.9 -0.5

Abcam +2.6 -0.4

Top stock

contributors

Relative

position

%

Contribution

%

LSE +4.8 +1.6

Edenred +2.6 +0.9

Amplifon +2.0 +0.7

Aveva +2.0 +0.6


Pernod-Ricard +3.0 +0.5

Heineken +4.6 +0.5

Experian +1.8 +0.5


Deutshce Boerse +3.8 +0.4

AS SICAV I - European Equity Fund stock attribution

One year to 31 August 2019

Benchmark / Reference Index: FTSE World Europe




38

AS SICAV I - European Equity Fund Performance Summary

Performance: 31 July 2019

Past performance is not a guide to future results Inception: 31 Jan 1993. Benchmark / Reference Index: FTSE World Europe

Source: Aberdeen Standard Investments, BPSS, Thomson Reuters Datastream, EUR


Fund return % Benchmark / Reference Index return

%

Difference %

Current month 0.20 0.40 -0.21

Last three months 2.03 -0.10 2.13

Year to date 25.92 17.18 8.74

Annualised periods

1 year 6.85 2.05 4.80

3 years 11.39 7.67 3.72

5 years 7.31 6.09 1.23

Since inception 9.09 8.32 0.77

Cumulative periods

1 year 6.85 2.05 4.80

3 years 38.23 24.83 13.39

5 years 42.33 34.39 7.94

Since inception 902.95 731.59 171.36

Calendar years

2018 -6.92 -10.39 3.47

2017 13.61 11.38 2.22

2016 3.78 3.15 0.62

2015 3.80 8.84 -5.04

2014 5.01 7.53 -2.51

Aberdeen Standard SICAV I -European Equity (ex-UK) Fund

40

Aberdeen Standard SICAV I - European Equity (ex-UK) Fund

Core pod of three decision makers on the fund

Clear accountability within a team framework


• Aberdeen Standard SICAV I European Equity (ex-UK) Fund is managed by Ben Ritchie, Kurt Cruickshank and Angus Tester

Kurt Cruikshank

Investment Director

Angus Tester

Investment

Manager

Ben Ritchie

Head of Europe

41

Long term quality investing – empirical evidence supporting our approach

Past performance is not a guide to future results. Source: Aberdeen Standard Investments. For Illustrative purposes only, not representative of a real portfolio

Q1 / Q2 Reference index

Annualised return Number of stocks Annualised return

Europe ex-UK 15.46% 104 8.21%

Euro ex UK

Q1 / Q2 Euro ex UK Reference index

Growth of £100 (£)

2010 2011 2012 2013 2014 2015 2016 2017

Year (monthly values)

300

250

200

150

100

50

350

• Analysis of Pan European team Quality ratings since 2009 demonstrates that the companies we grade the highest quality (Q1 and Q2) have

outperformed

High quality companies have outperformed

42

AS SICAV I - European Equity (ex-UK) Fund

Highly differentiated to the Benchmark / Reference Index

Meaningful risk control while retaining flexibility to express conviction

Source: Aberdeen Standard Investments (APT Analysis), 31August 2019

Parameter Guidelines

Benchmark / Reference Index FTSE World Europe ex-UK Index

Relative Limits

• Stock

• Sector

• Country

+/-5%

+/-10%

+/-15%

Number of holdings 30 – 75 (target range 30-50)

34 holdings as at end July 2019

Tracking Error 3- 9%

Structure SICAV (Fund size: 96,956,308 euro)

Strategy characteristics Strategy Benchmark / Reference

Index

Market capitalisation (w. avg) €50.7bn €66.2bn

Price / earnings (FY2) 22.4x 13.2x

Historic 3yr EPS growth 12.2% 7.1%

Return on equity (5 year) 22.9% 16.1%

Long term debt / equity 0.8x 1.1x

Beta (ex-ante) 0.86 -

Portfolio volatility 10.9% 11.5%

Active share 82.7% -

Tracking error (ex-ante) 4.9% -

Holdings by Market Cap

(EUR) Portfolio (%)

Benchmark / Reference

Index (%)

Small (<2.5bn) 3.1 0.6

Mid (2.5bn to 10bn) 25.3 15.0

Large (> 10bn) 71.5 84.4

• A higher p/e than the market BUT

• Return characteristics of the portfolio are superior to the Benchmark /

Reference Index

• Historic earnings growth is ahead of the Benchmark / Reference Index

• Balance sheet strength provides greater resilience and resources to

reinvest back into the businesses

43

AS SICAV I - European Equity (ex-UK) Fund top 10 holdings

A focus on market leading franchises

Companies selected for illustrative purposes only to demonstrate Aberdeen Standard Investment’s investment management style and not as an investment recommendation or indication of future

performance. Source: Aberdeen Standard Investments, 31 July 2019

Company name Country Sector % Market Leader

Unilever Netherlands Personal Goods 5.2 Personal Care & Food Products

Heineken Netherlands Beverages 4.9 Beer

Nestle Switzerland Food Producers 4.7 Food and Beverages

Kerry Ireland Food Producers 4.1 Taste & Nutrition

ASML Netherlands Technology Hardware and Equipment 4.1 Semiconductor Manufacturing

Amadeus Spain Software and Computer Services 3.6 Travel Software

Essilor Luxottica France Manufacturer 3.6 Optical Lenses

MTU Aero Engines Germany Aerospace & Defence 3.5 Aero Engine Systems

Deutsche Boerse Germany Financial Services 3.4 Securities Exchanges

Ubisoft Entertainment France Leisure goods 3.4 Video Games

44

AS SICAV I - European Equity (ex-UK) Fund asset allocation

Sector – Absolute Weights


Country – Absolute Weights

Sector – Relative Weights


Country – Relative Weights

Source: Aberdeen Standard Investments, 31 August 2019 Source: Aberdeen Standard Investments, 31 August 2019

Overweight / Underweight positions

Financials

Basic Materials

Utilities

Telecommunications

Oil & Gas

Consumer Services

Health Care

Industrials

Technology

Consumer Goods

-20.0 -15.0 -10.0 -5.0 0.0 5.0 10.0 15.0 20.0

France Germany

Switzerland Spain

Finland Belgium

Norway Poland Turkey

Portugal Greece

Hungary Czech Republic

Sweden Austria

Denmark Italy

Ireland Netherlands

-12.00 -7.00 -2.00 3.00 8.00

2.9

10.5

14.5

14.6

16.2

35.5

Consumer Services

Financials

Health Care

Industrials

Technology

Consumer Goods

0.0 10.0 20.0 30.0 40.0

Consumer Services Financials Health Care Industrials Technology Consumer Goods

1.4 3.6

4.1 5.8 6.1

8.0

15.1 16.9 17.0

17.6

Austria

Spain

Ireland

Denmark

Sweden

Italy

Germany

Switzerland

Netherlands

France

0.0 5.0 10.0 15.0 20.0

Austria Spain Ireland Denmark Sweden Italy Germany Switzerland Netherlands France

45

AS SICAV I - European Equity (ex-UK) Fund

Performance to 31 August 2019

Past performance is not a guide to future results Inception: 30 April 1992. Benchmark / Reference Index: FTSE World Europe ex UK

Source: Aberdeen Standard Investments, BPSS, Thomson Reuters Datastream, Lipper EUR

Performance is shown gross of fees and does not reflect investment management fees. Had such fees been deducted, returns would have been lower

EUR Annualised (%)

Year to date 1 year 3 years 5 years

Aberdeen Standard SICAV I - European Equity ex-UK 27.64 6.66 13.24 9.79

FTSE World Europe ex-UK 17.29 3.75 7.99 6.55

Difference +10.36 +2.91 +5.25 +3.25

Quartile 1 (Top Decile) 1 (Top Decile) 1 (Top Decile) 1

EUR 2018 2017 2016

Aberdeen Standard SICAV I - European Equity ex-UK -4.46 14.90 2.76

FTSE World Europe ex-UK -10.45 13.01 3.35

Difference +6.00 +1.89 -0.59

46

Bottom stock

contributors

Relative

position

%

Contribution

%


Novozymes +2.4 -0.4

Ubi Soft Entertainment +3.3 -0.4

LVMH Moet Hennessy -1.5 -0.3

Airbus -1.2 -0.3

Novartis -3.0 -0.3

Anheuser-Busch Inbev -1.1 -0.3

SAP +1.1 -0.3


Swedish Match +2.6 -0.2

Top stock

contributors

Relative

position

%

Contribution

%

Nemetschek +1.8 +1.4

Amplifon +3.3 +1.4

MTU Aero Engines +3.3 +1.1

Temenos +1.7 +0.9

Edenred +2.7 +0.7

Vat +2.2 +0.6

ASML +2.7 +0.5

Heineken +4.5 +0.4

Partners Group +1.9 +0.4


AS SICAV I - European Equity (ex-UK) Fund stock attribution

Year to date to 31 August 2019

Benchmark / Reference Index: FTSE World Europe ex UK




47

AS SICAV I - European Equity (ex-UK) Fund stock attribution

One year to 31 August 2019

Benchmark / Reference Index: FTSE World Europe ex UK




Bottom stock

contributors

Relative

position

%

Contribution

%


Novartis -3.0 -0.8

Amadeus IT +3.1 -0.7


Swedish Match +2.6 -0.5

Burckhardt Compression +0.0 -0.5

Novozymes +2.4 -0.5

Julius Baer +1.5 -0.4

Roche Holdings -3.1 -0.4

Fuchs Petrolub -0.1 -0.4

Top stock

contributors

Relative

position

%

Contribution

%

Edenred +2.7 +0.9

MTU Aero Engines +3.3 +0.8

Amplifon +3.3 +0.7

ASML +2.7 +0.6


Heineken +4.5 +0.5

Unilever +3.8 +0.4

Pernod-Ricard +2.4 +0.4

L’Oreal +1.8 +0.4


48

AS SICAV I - European Equity (ex-UK) Fund Performance Summary

Performance: 31 July 2019

Past performance is not a guide to future results Inception: 30 April 1992. Benchmark / Reference Index: FTSE World Europe ex UK

Source: Aberdeen Standard Investments, BPSS, Thomson Reuters Datastream, EUR


Fund return % Benchmark / Reference Index return

%

Difference %

Current month 1.67 0.32 1.35

Last three months 2.76 0.81 1.95

Year to date 26.63 18.23 8.39

Annualised periods

1 year 7.78 2.74 5.04

3 years 12.94 8.55 4.39

5 years 9.97 7.15 2.82


Cumulative periods

1 year 7.78 2.74 5.04

3 years 44.04 27.90 16.14

5 years 60.83 41.23 19.60


Calendar years

2018 -4.46 -10.45 6.00

2017 14.90 13.01 1.89

2016 2.76 3.35 -0.59

2015 10.31 10.92 -0.61

2014 7.46 7.38 0.09

49

Discrete performance

Annual returns to Year Ended 31 August (net of fees)

Past performance is not a guide to future results.

Year ended 31 August (%) 2019 2018 2017 2016 2015

Fund 5.77 19.26 9.08 1.22 4.62

Year ended 31 August (%) 2019 2018 2017 2016 2015

Fund 7.70 17.06 19.33 18.97 -3.54

Aberdeen Standard SICAV I – European Equity Fund

Aberdeen Standard SICAV I – European Equity (ex-UK) Fund

Source: Lipper. Share Class A Acc. Total Return, NAV to NAV, net of annual charges, gross income reinvested, EUR, 31 August 2019

Source: Lipper. Share Class X Acc. Total Return, NAV to NAV, net of annual charges, gross income reinvested, EUR, 31 August 2019

50


The value of investments and the income from them can go down as well as up and investors may get back less than the amount invested.

• Investing globally can bring additional returns and diversify risk. However, currency exchange rate fluctuations may have a positive or negative impact on the value

of your investment

A full list of the risks applicable to this Fund can be found in the Prospectus which is available at www.aberdeenstandard.com or upon request.


The following risk factors should be considered prior to making an investment decision

http://www.aberdeenstandard.com/

51


The value of investments and the income from them can go down as well as up and investors may get back less than the amount invested.

• Investing globally can bring additional returns and diversify risk. However, currency exchange rate fluctuations may have a positive or negative impact on the value

of your investment

• Emerging markets or less developed countries may face more political, economic or structural challenges than developed countries. This may mean your money is

at greater risk

A full list of the risks applicable to this Fund can be found in the Prospectus which is available at www.aberdeenstandard.com or upon request.


The following risk factors should be considered prior to making an investment decision

52

Past performance is not a guide to future results. The value of investments, and the income from them, can go down as well as up and clients may get

back less than the amount invested.

The views expressed in this presentation should not be construed as advice or an investment recommendation on how to construct a portfolio or whether to buy, retain or sell a

particular investment. The information contained in the presentation is for exclusive use by professional customers/eligible counterparties (ECPs) and not the general public. The

information is being given only to those persons who have received this document directly from Aberdeen Asset Managers Limited or Standard Life Investments Limited (together

“Aberdeen Standard Investments”) and must not be acted or relied upon by persons receiving a copy of this document other than directly from Aberdeen Standard Investments. No part

of this document may be copied or duplicated in any form or by any means or redistributed without the written consent of Aberdeen Standard Investments.

The information contained herein including any expressions of opinion or forecast have been obtained from or is based upon sources believed by us to be reliable but is not guaranteed

as to the accuracy or completeness.

The MSCI information may only be used for your internal use, may not be reproduced or re-disseminated in any form and may not be used as a basis for or a component of any

financial instruments or products or indices. None of the MSCI information is intended to constitute investment advice or a recommendation to make (or refrain from marketing) any kind

of investment decision and may not be relied on as such. Historical data and analysis, should not be taken as an indication or guarantee of any future performance analysis forecast or

prediction. The MSCI information is provided on an ‘as is’ basis and the user of this information assumes the entire risk of any use made of this information. MSCI, each of its affiliates

and each other person involved in or related to compiling, computing or creating any MSCI information (collectively, the ‘MSCI’ Parties) expressly disclaims all warranties (including

without limitation, any warranties of originality, accuracy, completeness, timeliness, non-infringement, merchantability and fitness for a particular purpose) with respect to this

information. Without limiting any of the foregoing, in no event shall any MSCI Party have any liability for any direct, indirect, special, incidental, punitive, consequential (including,

without limitation, lost profits) or any other damages (www.msci.com).”

FTSE International Limited (‘FTSE’) © FTSE 2019. ‘FTSE®’ is a trade mark of the London Stock Exchange Group companies and is used by FTSE International Limited under licence.

RAFI® is a registered trademark of Research Affiliates, LLC. All rights in the FTSE indices and / or FTSE ratings vest in FTSE and/or its licensors. Neither FTSE nor its licensors accept

any liability for any errors or omissions in the FTSE indices and / or FTSE ratings or underlying data. No further distribution of FTSE Data is permitted without FTSE’s express written

consent.

For professional clients only – Not for public distribution

53

Aberdeen SICAV I is a Luxembourg-domiciled UCITS fund, incorporated as a Société Anonyme and organized as a Société d’Invetissement á Capital Variable (a “SICAV”). The

information contained in this marketing document is intended to be of general interest only and should not be considered as an offer, or solicitation, to deal in the shares of any

securities or financial instruments. Aberdeen Standard Sicav I has been authorized for public sale in certain jurisdictions and private placement exemptions may be available in others.

It is not intended for distribution or use by any person or entity that is a citizen or resident of or located in any jurisdiction where such distribution, publication or use would be prohibited.

Before investing, investors should consider carefully the investment objective, risks, charges, and expenses of a fund. This and other important information is contained in the

prospectus, which can be obtained from a financial advisor and are also available on www.aberdeenstandard.com. Prospective investors should read the prospectus carefully before

investing.

No information, opinions or data in this document constitute investment, legal, tax or other advice and are not to be relied upon in making an investment or other decision. Subscriptions

for shares in the Fund may only be made on the basis of the latest prospectus, relevant Key Investor Information Document (KIID). These can be obtained free of charge from

Aberdeen Standard Investments, 1 George Street, Edinburgh, EH2 2LL, Scotland and are also available on www.aberdeenstandard.com

These documents and the articles of incorporation are available in English/ Italian/German/ French free of charge on www.aberdeenstandard.com. In Italy these documents can be

obtained from Aberdeen Standard Investments Ireland, Italian Branch, Via Dante 16, IT 20121, Milano, or from the Paying Agent, State Street Bank S.p.A, 10 Via Ferrante Aporti,

20125 Milano and are also available on www.aberdeen-asset.it.In Switzerland these documents along with the Fund’s articles of association can be obtained from the Fund’s

Representative and Paying Agent, BNP Paribas Securities Services, Paris, succursale de Zurich, Selnaustrasse 16, CH 8002 Zürich, Switzerland (Tel. 058 212 63).

Issued in Switzerland by Aberdeen Standard Investments (Switzerland) AG. Registered in Switzerland No. CHE-114.943.983. Registered Office: Schweizergasse 14, 8001 Zurich.

Authorised by the Swiss Financial Market Supervisory Authority (FINMA).

In Germany these documents can be obtained from Aberdeen Asset Managers Limited Deutschland Branch, Bockenheimer Landstraße 25, D-60325 Frankfurt am Main or from the

Paying Agent Marcard, Stein & Co. AG, Ballindamm 36, D-20095 Hamburg, in Austria from the Fund's Representative and Paying Agent Raiffeisen Zentralbank

ÖsterreichAktiengesellschaft, Am Stadtpark 9, A-1030 Wien.

United Kingdom (UK): Aberdeen Standard Investments Luxembourg S.A. 35a, Avenue J.F. Kennedy, L-1855 Luxembourg. No. S00000822. Authorised in Luxembourg and regulated

by CSSF

Austria, Belgium, Cyprus, Denmark, Finland, France, Germany, Gibraltar, Greece, Iceland, Ireland, Italy, Luxembourg, Malta, Netherlands, Norway, Portugal, Spain, and Sweden:

Aberdeen Standard Investments Luxembourg S.A. 35a, Avenue J.F. Kennedy, L-1855 Luxembourg. No. S00000822. Authorised in Luxembourg and regulated by CSSF

Aberdeen Standard SICAV l have been registered with the Comisión Nacional del Mercado de Valores under the number 107.

For professional clients only – Not for public distribution

GB-300919-100279-1




http://www.aberdeen-asset.it.in/



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