CapMan Oyj Class B · OMXHEX:CAPMAN
CapMan Oyj Class B — Q1 2012 Earnings Presentation
44 slides from CapMan Oyj Class B's earnings presentation, May 14, 2012
Slide 1: CapMan Group interim results 1 January – 31 March 2012
CapMan Group interim results 1 January – 31 March 2012 Carnegie lunch event, Helsinki 14 May 2012 Jerome Bouix – Head of Sales, Marketing, IR and Communications, Senior Partner Niko Haavisto – CFO Certain statements included in this material, including, without limitation, statements regarding futur
Slide 2: Contents
• CapMan in short Contents • Business environment • Activity and results January – March 2012 2 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 3: CapMan
CapMan • Unique listed private equity fund manager • More than 20 years’ experience from Nordic and Russian private equity • Strong local presence and market coverage 3 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 4: Four key investment partnerships
Four key investment partnerships CapMan CapMan CapMan CapMan Buyout Russia Public Market Real Estate • Unlisted Nordic mid- • Growth financing in • Listed Nordic small • Commercial and market companies Russian SMEs with and mid cap hotel properties, • Both equity and minority positions companies and
Slide 5: Active owner of portfolio companies and real estate
Active owner of portfolio companies and real estate CapMan CapMan CapMan CapMan Buyout Russia Public Market Real Estate 36 portfolio companies and 58 real estate properties €5.8 billion 39,600 700,000 m² net sales* personnel lettable area * 2011 figures 5 CapMan Group Interim Results 1 Jan - 31 Mar
Slide 6: Demonstrated value creation capability
Demonstrated value creation capability Portfolio company investments Real estate investments 350 350 300* 300 300 250 250 IRR 32% IRR 57% 200 ** 200 200 Average holding period Average holding period 5.4 years 1.7 years 150 150 100 100 100 100 50 50 0 0 Value at investment Value at exit Value at inve
Slide 7: CapMan's attractive earnings model
CapMan’s attractive earnings model Management Company Business Fund Investment Business Investments from CapMan’s own balance Private Equity Fund Management sheet into funds under it’s management Management Fees Carried Interest Based on the amount of 10-20% of the fund’s cash flow Return of Fund In
Slide 8: Peer group
Peer group BUYOUT CapMan is well- positioned on all markets PUBLIC MARKET Accendo Capital Partners Oy REAL ESTATE RUSSIA 8 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 9: Organisation
Organisation CEO Management Group Entrepreneurial investment partnerships* CapMan CapMan CapMan Public CapMan Real Buyout Russia Market Estate CapMan Platform Sales, Marketing, Investor Finance, Back Office, Relations and Communications Legal and IT Human Resources * Other CapMan investment areas do
Slide 10: Our vision
Our vision By 2020 we are the best-performing European private equity firm 10 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 11: Strategy
Strategy CapMan’s strategy is to combine… …the …all strengths of capabilities entrepreneurial AND within partnerships… CapMan… …to provide excellent returns to investors. 11 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 12: Contents
• CapMan in short Contents • Business environment • Activity and results January – March 2012 12 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 13: Investment operations
Investment operations 13 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 14: Q1 2012 deal activity remained at Q4 2011 level
Q1 2012 deal activity remained at Q4 2011 level Number of buyout deals Buyout deal value in the Nordic region in the Nordic region # €bn 100 30 67 25 80 20 60 15 €10.1 bn 40 10 12 €2.4 20 5 bn 0 0 2005 2006 2007 2008 2009 2010 2011 Q1 2004 2005 2006 2007 2008 2009 2010 2011 Q1 2012 2012 FY / Q1 Q2 Q
Slide 15: Leverage ratios have remained fairly constant
Leverage ratios have remained fairly constant Leverage ratios in European small & mid-sized transactions* 6,0x 5,0x 4.1x 3.7x 4,0x 3,0x 2,0x 1,0x 0,0x 2006 2007 2008 2009 2010 2011 Debt/EBITDA Senior Debt/EBITDA * European buyouts (EV<250MEUR) Source: S&P LCD European Leveraged Buyout Review Jan-Dec
Slide 16: Domestic buyers still dominate the Finnish real estate market
Domestic buyers still dominate the Finnish real estate market Development of transaction value in the Finnish commercial property market €bn 8 6 4 2 €0.5bn 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Q1 2012 Domestic buyer International buyer Source: KTI 16 CapMan Group Interim Results
Slide 17: Fundraising
Fundraising 17 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 18: Fundraising remains challenging…
Fundraising remains challenging… Capital committed to European buyout funds $ Bn Funds (#) 160 120 …but interest 140 100 in Nordic 120 80 funds is 100 relatively 80 60 high 60 40 compared to 40 the rest of 23 20 20 $15.1 Europe bn 0 0 2006 2007 2008 2009 2010 2011 Q1 2012 Commitments Funds (#) Sourc
Slide 19: Global real estate fundraising also remains highly competitive…
Global real estate fundraising also remains highly competitive… Global capital commitments to real estate funds Bn $ Funds (#) 160 300 140 250 …and countries 120 with good 100 200 economic 80 150 outlook attract most interest 60 100 from investors 40 50 20 28 $10.2 bn 0 0 2003 2004 2005 2006 2007 20
Slide 20: Impact of sovereign wealth crisis on LPs' investment strategies in Europe
Impact of sovereign wealth crisis on LPs’ investment strategies in Europe LPs’ plans for European fund commitments in the next 2–3 years 35 % 30% 30 % 25 % 20 % 15 % 8% 10 % 5% 0% Small buyout Mid-market buyout Growth capital Venture capital Large buyout (> $1 (<$200 mn ) ($200-999 mn ) bn ) Decreas
Slide 21: Challenges in the private equity industry
Challenges in the private equity industry Solvency II bad news for private equity investments by insurance companies Basel III bad news for private equity investments by banks LPs are also increasingly picky in GP relationships 21 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 22: Progress of CapMan's fundraising effort
Progress of CapMan’s fundraising effort We commenced fundraising in three key investment areas in Q1 2012. We aim to raise more than €700 million during the ongoing fundraising round. 22 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 23: Contents
• CapMan in short Contents • Business environment • Activity and results January – March 2012 23 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 24: Group turnover and operating profit
Group turnover and operating profit Turnover Operating profit € million € million 40,0 12 11.0 11.1 32.4 10 9.2 30,0 25.6 8 20,0 6 15.7 4.0 4 10,0 8.2 2.7 6.7 2 - 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2011 2012 2011 2012 24 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 25: Breakdown of results March 2012
Breakdown of results 31 March 2012 € million 12 3.5 -7.5 10 Operating profit €2.7 million 8 0.5 6.2 6 Profit before taxes 0.7 €3.6 million 4 0.2 2 0 Management fees Other income Fair value gains and losses of investments Financial income and expense Operating costs Share of associated companies’ res
Slide 26: Management Company profit slightly negative
Management Company business Management Company profit slightly negative € million 1-3/2012 1-3/2011 • Management fees decreased as 6.7 8.2 expected from the comparable Turnover period Management fees 6.2 7.1 Real estate consulting 0 0.5 Carried interest 0 0.4 Other income 0.5 0.2 Operating expenses
Slide 27: Management fees and carried interest
Management Company business Management fees and carried interest Management fees Carried interest € million € million 30 4 27.1 3.0 3.1 20.7 3 20 13.9 2 10 7.1 6.2 1 0.4 0.4 0.0 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2011 2012 2011 2012 27 CapMan Group Interim Results 1 Jan - 31 Mar 2012 14 May 2012
Slide 28: CapMan's carried interest base 1 March 2012
Management Company business CapMan’s carried interest base 31 March 2012 Portfolios at fair value (equity) by funds’ carried interest phase, in total €1.6bn 10% 1% 18% Funds generating carried interest, €12.6 million Funds in exit and value creation phase, €1,127.8 million Funds in active investment
Slide 29: Analysing CapMan Equity VII A, B and Sweden
Management Company business Analysing CapMan Equity VII A, B and Sweden A Sweden B Fund size ~paid in capital, €m 156.7 67.0 56.5 Capital returned to investors, €m 148.0 63.6 69.1 Remaining portfolio at fair value, €m 70.0 30.0 29.9 Amount of cash flow needed to transfer the fund to carry (31 62.5 2
Slide 30: Analysing CapMan Equity VII A, B and Sweden
Management Company business Analysing CapMan Equity VII A, B and Sweden 31 March 2012 • 8 companies in buyout portfolio – Partial exits from 3 companies • 9 companies in technology portfolio • Aggregate fair value of the portfolios: €129.9 million Buyout portfolio Technology portfolio Connode Holdin
Slide 31: Analysing impact of own investments and carried interest potential: CapMan Buyout VIII
Management Company Analysing impact of own investments and business Fund Investment carried interest potential: CapMan Buyout VIII business 31 March 2012 CAPMAN BUYOUT VIII In total Fund size: €440.0 million Paid-in capital: €389.3 million Portfolio at fair value: €301.9 million Cash flow to investo
Slide 32: Fund Investment business results remained robust
Fund Investment business Fund Investment business results remained robust € million 1-3/2012 1-3/2011 • Increase of approx. 5% in fair Fair value gains/losses of values between January and 3.5 4.1 investments March 2012. Operating profit 3.4 4.0 Profit for the period 3.6 3.4 • Fair value gains are a
Slide 33: Factors affecting fair value development
Fund Investment business Factors affecting fair value development Financial performance of Preliminary exit portfolio companies negotiations Fair Peer group valuation Value Exchange rates, (OMX Nordic Mid Cap), 1-3/2012 1-3/2012 EUR/RUB + 14.32% EUR/SEK M&A transactions in EUR/NOK the industry 33 Ca
Slide 34: Fair value of investments March 2012
Fund Investment business Fair value of investments 31 March 2012 Changes in fair values of 54 portfolio Changes in fair values of 59 real estate companies in 1-3/2012* investments in 1-3/2012* 9% 0% 2% 3% 30% 61% 95% New investments New investments Fair value increased Fair value increased Fair valu
Slide 35: Fund investments and commitments totalled €97.9 million
Fund Investment business Fund investments and commitments totalled €97.9 million €m Majority of investments and commitments in buyout funds 60 50 40 30 20 10 0 Buyout, 60% Russia, 5% Public Market, Real Estate, 7% Other, 16% Access, 7% 5% • Investments in fair value, in total €74.6 million (lower pa
Slide 36: Financial objectives
Financial objectives We believe that private equity remains a growth industry, and CapMan continues to exploit growth opportunities especially in its key investment areas. Growth will be a natural outcome of high performance. Objectives Realised Q1 2012 Performance Return on equity over 20% p.a. Ret
Slide 37: CapMan guidance – 2012 result
CapMan guidance – 2012 result • CapMan’s next major fundraising rounds will take place in 2012. The development of the company’s current year management fees will depend on the timing of exits made from current funds and the size and timing of new funds to be established. • Our operating expenses wi
Slide 38: IR calendar and IR team
IR calendar and IR team IR calendar 2012 IR team Lennart Simonsen, CEO, Senior Partner Tel. +358 207 207 567 Q2 Results lennart.simonsen@capman.com 9 Aug 2012 Q3 Results Jerome Bouix, Head of Sales, Marketing, Investor 1 Nov 2012 Relations and Communications, Senior Partner Tel. +358 207 207 558 jer
Slide 39: Additional slides
Additional slides
Slide 40: Key figures as of 31 March 2012
Key figures as of 31 March 2012 31 Mar ‘12 31 Mar ‘11 31 Dec ‘11 Earnings per share, cents* 2.9 3.5 10.1 Diluted, cents 2.9 3.5 10.1 Shareholders' equity / share, cents** 98.8 97.2 104.7 Share issue adjusted number of shares 84,255,467 84,255,467 84,255,467 Number of shares at the end of period 84,2
Slide 41: Group Income Statement, IFRS
Group Income Statement, IFRS € million 1-3/12 1-3/11 1-12/11 Turnover 6.7 8.2 32.4 Management fees 6.2 7.1 27.1 Carried interest 0.0 0.4 3.1 Real Estate consulting 0.0 0.5 1.0 Other income 0.5 0.2 1.2 Other operating income 0.0 0.0 0.6 Operating expenses -7.5 -8.3 -34.9 Fair value gains / losses of
Slide 42: Group Balance Sheet – Assets, IFRS
Group Balance Sheet – Assets, IFRS € thousands 31 Mar ’12 31 Mar ’11 31 Dec ’11 Tangible assets 401 558 438 Goodwill 6,204 6,406 6,204 Other intangible assets 1,913 2,300 1,881 Investments in associated companies 9,174 6,860 8,347 Investments at fair value through profit and loss Investments in fund
Slide 43: Group Balance Sheet – Total equity and liabilities, IFRS
Group Balance Sheet – Total equity and liabilities, IFRS € thousands 31 Mar ’12 31 Mar ’11 31 Dec ’11 Share capital 772 772 772 Share premium account 38,968 38,968 38,968 Other reserves 38,814 38,679 38,679 Translation difference 43 72 38 Retained earnings 4,682 3,443 9,784 Capital attributable the
Slide 44: CapMan Plc's largest shareholders
CapMan Plc’s largest shareholders 31 March 2012 Share of all shares % Share of all voting rights % Ilmarinen Mutual Pension Insurance Company 8.5% 5.3% Aristo Invest Oy + Ari Tolppanen* 8.3% 19.4% Winsome Oy + Tuomo Raasio* 4.5% 8.3% Varma Mutual Pension Insurance Company 4.4% 2.7% Vesasco Oy 4.0% 2