FOR INVESTMENT PROFESSIONAL AND INSTITUTIONAL USE ONLY. FOR MFS INTERNAL USE ONLY. FOR DEALER USE ONLY. Should not be shown, quoted, or distributed to the public. CONSISTENCY IN TOUGH MARKETS The benefits of taking a longer-term view in European Equities Gabrielle Gourgey Institutional Portfolio Manager MFS Investment Management 0 26170.4 See important disclosures on final page of presentation. See the fund’s offering documents for more details, including information on fund risks and expenses. The views expressed in this presentation are those of the speaker and are subject to change at any time. These views do not necessarily reflect the views of MFS or others in the MFS organization. MFS Meridian Funds are not available for sale in the United States or Canada or to US or Canadian citizens or residents. MFS International Ltd. For Investment Professional Use Only. Not intended for retail investors. NOT GUARANTEED • MAY LOSE VALUE
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FOR INVESTMENT PROFESSIONAL AND INSTITUTIONAL USE ONLY.
FOR MFS INTERNAL USE ONLY.
FOR DEALER USE ONLY. Should not be shown, quoted, or distributed to the public.
CONSISTENCY IN TOUGH MARKETS The benefits of taking a longer-term view in European Equities
See important disclosures on final page of presentation.
See the fund’s offering documents for more details, including information on fund risks and expenses.
The views expressed in this presentation are those of the speaker and are subject to change at any time. These views do not necessarily reflect the views of MFS or others in the MFS organization.
MFS Meridian Funds are not available for sale in the United States or Canada or to US or Canadian citizens or residents.
MFS International Ltd.
For Investment Professional Use Only. Not intended for retail investors. NOT GUARANTEED • MAY LOSE VALUE
For Investment Professional Use Only. Not intended for retail investors.
We've been adding value for centuries…….
1
For Investment Professional Use Only. Not intended for retail investors. 2
…And can you imagine living without…
For Investment Professional Use Only. Not intended for retail investors. 3
Global GDP growth is what drives European earnings growth
0.5
0.1
0.0
0.1
0.2
0.3
0.4
0.5
0.6
Global growth and European earnings European growth and European earnings
Correlation coefficient (1991 onwards)
Sources: Macquarie Research, IMF and FactSet. As at 31 December 2012.
For Investment Professional Use Only. Not intended for retail investors.
For Investment Professional Use Only. Not intended for retail investors.
Short-term focus of the market Research coverage for two global large cap companies
Financial Services Technology
2014 Earnings Per
Share
Estimates
# of estimates 28
Range £0.63 - £0.83
# of estimates 49
Range $40.20 - $58.18
Well covered by sell-
side analysts
2016 Earnings Per
Share
Estimates
# of estimates 1
Range £0.94
# of estimates 4
Range $35.12 - $76.00
Minimal coverage
Opportunity to
express different
view
Source: FactSet. As at 21 February 2013
Lengthen the investment time horizon
10
For Investment Professional Use Only. Not intended for retail investors. 11
Identifying opportunities
Adding value through stock selection
Sources: Bloomberg and SPAR
• Cumulative returns shown are for the period from the IPO, 28-Apr-10 to 12-Dec-12
‘Spain’ represents the Spanish market (MSCI Spain Index – gross total return in EUR)
For illustrative purposes only. Not all companies represented are holdings of the fund.
These portfolios are actively managed, and current holdings may be different. This is a list of the positions mentioned above and the percentage
(based on the equivalent exposure of unaudited net assets) they represent in the portfolios as of 31 December 2012:
Inditex: MFS Meridian Funds – European Research Fund (0.9), MFS Meridian Funds – European Core Equity Fund (1.4)
Amadeus IT Holding: MFS Meridian Funds – Continental European Equity Fund (3.1), MFS Meridian Funds – European Value Fund (1.8), MFS Meridian Funds – European Research Fund (1.3),
MFS Meridian Funds – European Smaller Companies Fund (2.8), MFS Meridian Funds – European Core Equity Fund (1.6), MFS Meridian Funds – European Concentrated Equity Fund (3.5)
Returns (EUR) – 2012 Returns (EUR) – 3 years to 31-Dec-12
18%
3%
70%
56%
0%
10%
20%
30%
40%
50%
60%
70%
80%
MSCI Europe MSCI Spain Inditex Amadeus
22%
-20%
161%
81%
-40%
-20%
0%
20%
40%
60%
80%
100%
120%
140%
160%
180%
MSCI Europe MSCI Spain Inditex Amadeus
For Investment Professional Use Only. Not intended for retail investors.
What is quality? Rigorous research uncovering quality companies
Market position – brands, differentiated
products
Technology – patents, proprietary knowledge
Distribution – effective route to market
Markets – secular growth, low volatility
Balance sheet – robust financial structure
High return on capital
employed
Pricing power
Sustainable / growing profits
High operating margins
Strong free cash flow
Quality businesses help sustain earnings growth
12
For Investment Professional Use Only. Not intended for retail investors. 13
Consistency of outperformance High quality, low P/E five-year rolling outperformance over MSCI Europe universe
Source: Factset.
Universe MSCI Europe Dec 1994 through Dec 2012 recalculated every 3 months
Quality represented by equal-weighted composite factor of 3 yr average ROE and 3 yr Assets/ Equity with each component scored, summed and quintiled to form buckets Q1 through Q5 at 3 month intervals
All returns are equal-weighted
Combining high quality with low P/E helped drive excess returns
warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. 4
MFS® MeridianSM Funds
Europe OE
Morningstar
Category
Start of Fund
Performance 1 year 3 years 5 years 10 years
UK Equity Fund – I1GBP UK Large-Cap Blend
Equity 17/12/2001
23rd
127/566
2nd
9/498
2nd
6/451
4th
12/280
Continental European Equity Fund – I1GBP
Europe ex-UK Large-
Cap Equity 17/12/2001
49th
203/416
12th
43/350
3rd
10/299
5th
10/180
European Value Fund – I1EUR
Europe Large-Cap
Blend Equity 1/10/2002
41st
588/1436
2nd
23/1202
1st
6/963 -
European Research Fund – I1EUR
Europe Large-Cap
Blend Equity 12/3/1999
13th
175/1436
6th
68/1202
8th
74/963 -
European Smaller Companies Fund – I1EUR
Europe Flex-Cap
Equity 5/11/2001
1st
2/369
1st
1/315
2nd
5/245 -
European Core Equity Fund – I1EUR Europe Large-Cap
Growth Equity 1/10/2002
5th
8/155
10th
12/120
14th
14/95 -
For Investment Professional Use Only. Not intended for retail investors.
MFS® MeridianSM Funds –– U.K. EQUITY FUND Portfolio performance (GBP) as of 31 December 2012
A proven history of performance
1 Year 3 Years 5 Years 10 Years
Per
cent
(%
) 15.71
13.1411.28
8.096.69
2.94
10.549.33
Portfolio FTSE All-Share 5% Capped Index
20
For Investment Professional Use Only. Not intended for retail investors. 21
MFS® MeridianSM Funds –– EUROPEAN VALUE FUND Portfolio performance (EUR) as of 31 December 2012
A proven history of performance
1 Year 3 Years 5 Years 10 Years
Per
cent
(%
)
18.6517.29
11.17
6.203.60
-2.34
9.68
5.93
Portfolio MSCI Europe Index (net div)
For Investment Professional Use Only. Not intended for retail investors.
MFS® MeridianSM Funds — EUROPEAN RESEARCH FUND Portfolio performance (EUR) as of 31 December 2012
A proven history of performance
22
For Investment Professional Use Only. Not intended for retail investors. 23
MFS® MeridianSM Funds — EUROPEAN SMALLER COMPANIES FUND Portfolio performance (EUR) as of 31 December 2012
A proven history of performance
The performance shown is attributable in part to unusual market conditions. These conditions may not be repeated in the future.
For Investment Professional Use Only. Not intended for retail investors.
MFS® MeridianSM Funds — CONTINENTAL EUROPEAN EQUITY FUND Portfolio performance (GBP) as of 31 December 2012
A proven history of performance
1 Year 3 Years 5 Years 10 Years
18.89
15.95
5.85
1.22
5.70
-1.59
12.65
8.50
Portfolio MSCI Europe (ex-UK) Index (net div)
24
For Investment Professional Use Only. Not intended for retail investors. 25
MFS® MeridianSM Funds — EUROPEAN CORE EQUITY FUND Portfolio performance (EUR) as of 31 December 2012
A proven history of performance
1 Year 3 Years 5 Years 10 Years
Per
cent
(%
)
30.07
17.2915.20
6.204.44
-2.34
8.925.93
Portfolio MSCI Europe Index (net div)
For Investment Professional Use Only. Not intended for retail investors.
MFS® MeridianSM Funds — EUROPEAN CONCENTRATED FUND Portfolio performance (EUR) as of 31 December 2012
A proven history of performance
1 Year Since inception(22-Aug-11)
21.07
17.29
22.8221.08
Portfolio MSCI Europe Index (net div)
2012
MFS® MeridianSM Funds -
European Concentrated Fund 21.07
MSCI Europe Index (net return) 17.29
26
For Investment Professional Use Only. Not intended for retail investors.
Risk disclosure
MFS Meridian Funds:
UK Equity Fund (1,2,5,6), Continental European Equity Fund ( 1,2,5,6), European Value
Fund (1,2,3,6), European Research Fund (1,2,6), European Smaller Companies Fund
(1,2,4,6), European Core Equity Fund (1,2,6), European Concentrated Fund (1,2,5,6).
1 The fund may not achieve its objective and/or you could lose money on your investment in the fund.
2 Stock markets and investments in individual stocks are volatile and can decline
significantly in response to issuer, market, economic, political, regulatory, geopolitical, and other conditions.
3 Investments in value companies can continue to be undervalued for long periods of time
and be more volatile than the stock market in general. 4 Investments in small-cap companies can be more volatile than investments in larger
companies. 5 The fund’s performance could be more volatile than the performance of more diversified
funds. 6 Because the portfolio may invest a substantial amount of its assets in issuers located in a
single country or in a limited number of countries, it may be more volatile than a portfolio that is more geographically diversified.
Please see the prospectus for further information on these and other risk considerations.
27
For Investment Professional Use Only. Not intended for retail investors. 28
Fund regulatory details
See the fund's offering documents for more details, including information on fund risks and expenses. For additional information, call
European Union: MFS International (U.K.) Ltd., Paternoster House, 65 St. Paul's Churchyard, London, EC4M 8AB UK. Tel: 44 (0)20 7429
7200.
Switzerland: Carnegie Fund Services S.A., 11 rue du General-Dufour, 1204 Geneve, Switzerland. Tel: 41.22.705.1177.
MFS Meridian Funds from time to time may be registered for sale in other jurisdictions or otherwise offered where registration is not required.
MFS Meridian Funds are not available for sale in the United States or Canada or to US or Canadian citizens or residents.
Unless otherwise indicated, logos, product and service names are trademarks of MFS and its affiliates and may be registered in certain countries.
MFS International Ltd.
This material is for use only in Germany, Switzerland, United Kingdom.
FOR INSTITUTIONAL AND INVESTMENT PROFESSIONAL USE ONLY
CONSISTENCY IN TOUGH MARKETS THE BENEFITS OF TAKING A LONGER-TERM VIEW
For Investment Professional Use Only. Not intended for retail investors.
Appendix
30 For Investment Professional Use Only. Not intended for retail investors.
For Investment Professional Use Only. Not intended for retail investors.
MFS European equity team MFS European based investment resources
Title Name Years of
Industry Experience
Director of Equity Europe Christopher Jennings CFA 15 Portfolio Managers Peter Fruzzetti 19
Roger Morley 16 Benjamin Stone 17 Barnaby Wiener 19
Institutional Portfolio Gabrielle Gourgey 18
Managers Victoria Higley, ASIP 18 Ben Kottler, CFA 23
Research Analysts Matthew Barrett, ASIP 17 Consumer Staples Filipe Benzhino 6 Business Services Shanti Das-Wermes 3 Mid-Cap Consumer Staples Philip Evans 4 Leisure Anne-Christine Farstad 11 Telecom Services, Insurance, Banks David Falco, CFA 9 Chemicals Ward Griffiths, CFA 9 Consumer Cyclicals Pablo de la Mata, CFA 9 Autos, Technology, Healthcare Stuart McPherson 26 Capital Goods, Metals & Mining Sandeep Mehta 5 Non-US Small-Cap Specialist James Neale 15 Energy
Florence Taj 17 Financial, Banks, Brokers, Specialty Finance, Utilities