1. IOOF adviserbriefing “Australia – are we digging a hole for ourselves?” 2012

2. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Disclaimer This presentation is for financial adviser use only – it is not to be distributed to clients. Issued by IOOF Investment Management Limited (IIML), ABN 53 006 695 021, AFSL 230524. IIML is a company within the IOOF group of companies, consisting of IOOF Holdings Limited ABN 49 100 103 722 and its related bodies corporate. Examples are for illustrative purposes only. Past performance is not a reliable indicator of future performance.

3. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” The rise of resources

4. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Resources dominate EPS growth EPS growth (pa) Source: Bloomberg Consumer (Discretionary) IndustrialsFinancialsConsumer (Staples) Resources TelecomsEnergyUtilitiesHealthcare Earnings growth 2002-2012

5. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Change can be rapid Source: Legg Mason/ASX/IOOF Everything else Resources Telecoms Australian share market composition Resources

6. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Resources have dominated… but for how much longer?

7. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Resource market outlook PROJECTED Strong analyst forecast for resource earnings EPS (based to 100) Source: Bloomberg Resources Financials 201320142015 MayJunJulAugSepOctNovDecJanFebMar 20122011

8. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Resource market outlook Historical P/E near long-term average Source: Bloomberg Actual P/E Resources Average P/E Resources 200120032007200920052011

9. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” China GDP forecast to slow Source: Bloomberg Median High Low PROJECTED GDP growth (%) 199820002002200420062008201020121314

10. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Massive increase in iron ore supply Seaborne iron ore exports Source: Bloomberg Million metric tonnes 200120032005200720092011 Brazil Rest of world Australia

11. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” New iron ore projects Perth Geraldton Kalgoorlie Port Hedland Significant increases in supply ahead

12. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” No growth in iron ore price Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Jun Sep Dec Mar Q2 Q3 Q4 2013 2014 2009 2010 2011 2012 Source: Bloomberg PROJECTED Iron ore price Analyst forecast Futures prices

13. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Slower resource growth ? ? Phenomenal resource growth coming to an end Last 10 years Next 3 years Beyond 2015 Annual earnings growth (pa) Source: Bloomberg

14. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Positioning portfolios post-boom

15. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Watch for long-term trends 1998 Source: Bloomberg 1999200020012002200320042005200620072008200920102011 Telstra BHP

16. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Watch for long-term trends Source: Bloomberg Telstra BHP 19981999200020012002200320042005200620072008200920102011

17. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Under 15 (US) Over 65 (US) The world is getting older 1980198519902000200519952010 2015 Source: Bloomberg

18. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” The world is getting older Under 15 (US) Over 65 (US) 1980198519902000200519952010 2015 Under 15 (China) Over 65 (China) Source: Bloomberg

19. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” The world is getting older Source: Bloomberg Under 15 (Japan) Over 65 (Japan) 1980198519902000200519952010 2015 % Population

20. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Healthcare under-represented Room for growth in Australian healthcare Source: Bloomberg Healthcare

21. IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?” Opportunities in healthcare Australian health stocks can be winners 9,400% 339% 3,675% Source: Bloomberg 20 billion 18 billion 16 billion 14 billion 12 billion 10 billion 8 billion 6 billion 4 billion 2 billion

22. The next ten years won’t look like the last ten years What are the implications for public policy? How do we manage this transition as investors? Look for emerging sources of EPS growth Employ active management to capture value from emerging trends IOOFadviserbriefing 2012“Australia – are we digging a hole for ourselves?”

23. IOOF adviserbriefing 2012