FEBRUARY 2012

Value Investing in Asia

Ben Graham Center for Value Investing Value Investing Conference

April 8, 2014

Manage Partnership for Bear Markets

Deliver Results to Limited Partners

Overlook’s Tools

Focused & Independent Structure

Investment Culture

Proven Investment Philosophy

The Overlook Model

Two Drivers of Outperformance • Proven Investment Philosophy

-  Superior Businesses -  Management with Integrity -  Bargain Valuation -  Long Term Time Horizon

• Business Component -  Delivery of Returns to Investors

•  Measured by “Discount” Between TWR & CWR -  Single Fund Structure -  Legal Limit on Growth of Subscriptions -  Commitment to Cut Fees

• Too Many Managers Ignore Business Component

Path to Performance in Asia • Pricing Power • Utilization of Free Cash Flow • High Profitability • Sustainable EPS Growth • Valuation

Pricing Power In Action

15.0%

25.0%

35.0%

45.0%

55.0%

65.0%

0 500

1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 5,000

Revenue (USD mn) Gross Profit Margin

50.0%

55.0%

60.0%

65.0%

70.0%

75.0%

80.0%

85.0%

35,000

45,000

55,000

65,000

75,000

85,000

95,000

Revenue Cash Gross Profit Margin

Want-Want Holdings TSMC

Companies without Pricing Power Huaneng Power International Au Optronics

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

Revenue   EBITDA  Margin  

0.0%

5.0%

10.0%

15.0%

20.0%

25.0%

30.0%

35.0%

0 2,000 4,000 6,000 8,000

10,000 12,000 14,000 16,000 18,000

Revenue   EBITDA  Margin  

Different Utilizations of Free Cash Flow

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000 9,000

10,000

Gross Cash Flow Capex Dividends

BEC TSMC

0

50,000

100,000

150,000

200,000

250,000

300,000

350,000

Gross Cash Flow Capex Dividends

High Profitability Combined with Moderate Growth

0

0.1

0.2

0.3

0.4

0.5

0.6

Operating Return Return on Equity Normalized Growth

Source: Overlook Investments

Sustainable EPS Growth • Earnings Growth Critical to Long Term Performance

-  Last 12 Years at Overlook EPS Growth plus Dividends Contributed 82% of Performance

• Drivers of High Quality EPS Growth -  Pricing Power -  Low Cyclicality of Business -  Ability to Increase Market Share -  High Profitability -  Earnings Track Record -  Strong Balance Sheet

• Preface: Always External Risks that Cannot be Controlled

Valuations • Can’t Ignore Valuation • Equations Offer Benchmark

-  Ben Graham’s •  Price / Book Value Times P/E < 22.5

-  John Neff’s •  EPS Growth Rate, Plus Dividend Yield / P/E

-  Overlook’s •  ROE + Normalized EPS Growth Rate / 4

• Know Long Term Valuation Trends

Overlook’s Long Term Valuation Trends

0!

2!

4!

6!

8!

10!

12!

14!

16!

18!

Mar-9

4

Dec-9

5

Jul-9

8

Jul-9

9

Jul-0

0

Feb-

01

Nov-0

1

Jul-0

2

Jul-0

3

Jul-0

4

Jul-0

5

Jul-0

6

Jul-0

7

Jul-0

8

Jul-0

9

Jul-1

0

Jul-1

1

Jul-1

2

Jul-1

3

P/E Current Year P/E Forward 1 Year

! ! !

Source: Overlook Investments

Path to Out Performance:

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Price to Book Value

Forward P/E

P/E

EV/EBITDA

EPS Growth Rate

Dividend Yield

Net Cash (Debt)/Equity

Return on Equity

Operating Return

Percentile January 2014 June 2013 January 2013

Source: Capital IQ & Overlook: Overlook’s Portfolio by Percentile Compared to Asian Universe (>$3bn)

Virtuous Cycle Provides Margin of Safety

Outperformance Pricing Power

High Profitability

Focus on Valuation

Free Cash Flow

Results of The Overlook Model

• The Model is Overlook’s Strongest Asset -  Simple Structure, Effective Investment Philosophy,

Clear Objective & Long Track Record of Success - History Suggests Model Delivers Value

-  Capital Weighted Returns ≥ Time Weighted Returns -  9.5 Percentage Points of Outperformance Per Year -  Profits Comprise >70% of Overlook’s AUM

FEBRUARY 2012

Value Investing in Asia

Ben Graham Center for Value Investing Value Investing Conference

April 8, 2014