Equita Group Spa · MIL:EQUI
Equita Group Spa — FY2020 Earnings Presentation
42 slides from Equita Group Spa's earnings presentation, Mar 24, 2021
Slide 1: Full Year 2020 Results - STAR Conference Presentation
FULL YEAR 2020 RESULTS STAR CONFERENCE PRESENTATION 24 March 2021 THE EXPERTS OF FINANCIAL MARKETS
Slide 2: Agenda
EXECUTIVE SUMMARY Page 3 FY’20 RESULTS (KEY FINANCIALS) Page 5 RECENT DEVELOPMENTS, INITIATIVES & POSITIONING Page 10 CLOSING REMARKS Page 19 ANNEX INTRODUCTION (EQUITA AT A GLANCE) Page 24 GLOBAL MARKETS Page 28 RESEARCH TEAM Page 30 INVESTMENT BANKING Page 31 ALTERNATIVE ASSET MANAGEMENT Page 33 E
Slide 3: Executive Summary
EXECUTIVE SUMMARY FY’20 FINANCIAL RESULTS Growth and financial soundness confirmed Increase in profitability Double digit growth in client-related revenues, consolidated net Operating leverage, consolidation of accretive initiatives and revenues and net profits. Solid capital structure disciplined c
Slide 4: FY'20 Results (Key Financials)
Index FY’20 RESULTS (KEY FINANCIALS)
Slide 5: Snapshot on Full Year 2020 Consolidated Results
SNAPSHOT ON FULL YEAR 2020 CONSOLIDATED RESULTS KEY CONSOLIDATED HIGHLIGHTS 75% €68.2m €12.3m 20% 27% €0.9bn €0.20 payout ratio (+17% vs FY’19) (+29% vs FY’19) (as of 31 December 2020) (as of 31 December 2020) (+5% vs H1’20/ -7% vs FY’19) (+5% vs DPS 2019) (2) Net Net Profits Total Return on Assets
Slide 6: Snapshot on Divisional Performance
SNAPSHOT ON DIVISIONAL PERFORMANCE GLOBAL MARKETS NET REVENUES (€M) MARKET SHARES (%)(1) Client Sales & Trading Business Client Driven & Market Making +7% Equity 37,1 Directional Trading Equities Bonds 33,7 Options 30,6 30,5 29,9 31,5 FY’17 5.0% 1.8% 4.9% 25,8 20,8 +28% 21,5 21,8 FY’18 6.6% 4.2% 5.3
Slide 7: Profit & Loss and Focus on Costs
PROFIT & LOSS AND FOCUS ON COSTS DISCIPLINED APPROACH ON COSTS AND STRONG PROFITABILITY CONFIRMED SUMMARY OF CONSOLIDATED FIGURES Profit & Loss FY FY Var FY Focus on Costs €m 2020 2019 % 2018 Equita Group (Consolidated) FY FY €m 2020 2019 Var. % Net Revenues 68,2 58,3 17% 59,8 Personnel costs (1) (3
Slide 8: Dividend Proposal and Guideline for the Future
DIVIDEND PROPOSAL AND GUIDELINE FOR THE FUTURE DIVIDEND ON THE HIGH-END OF THE GUIDANCE PROVIDED IN SEPTEMBER 2020 75% +5% vs €0.19 Pay-out DPS 2019 €9.2m €0.20 €0.10 To be paid out in May 2021 Shareholders’ Dividend Remunerations per Share €0.10 To be paid out in November 2021 €12.3m FY’20 Net Prof
Slide 9: Recent Developments, Initiatives & Positioning
Index RECENT DEVELOPMENTS, INITIATIVES & POSITIONING
Slide 10: Acquisition of Equita K Finance
ACQUISITION OF EQUITA K FINANCE EQUITA ACQUIRED A 70% STAKE IN K FINANCE (NOW EQUITA K FINANCE), AN ITALIAN INDEPENDENT M&A ADVISORY BOUTIQUE WITH MORE THAN 20 YEARS EXPERIENCE AND SIMILAR VALUES AND FOUNDING PRINCIPLES TO EQUITA’S EQUITA K FINANCE AT A GLANCE Independence > €6m c. 10 Net Revenues D
Slide 11: Ongoing Integration of Equita K Finance
ONGOING INTEGRATION OF EQUITA K FINANCE SMOOTH INTEGRATION SINCE DAY 1. THE NEWLY ACQUIRED COMPANY HAD AN ACCRETIVE IMPACT ON FY’20 FINANCIALS AND STRENGTHENED SIGNIFICANTLY THE EQUITA MARKET POSITIONING IN M&A ADVISORY UPDATE ON THE INTEGRATION PROCESS AND KEY ACHIEVEMENTS Financial performance of
Slide 12: Equita Private Debt Fund II
EQUITA PRIVATE DEBT FUND II THE TEAM CLOSED TWO FUNDRAISING PHASES OF «EQUITA PRIVATE DEBT FUND II» (EPD II) AND REACHED €131.5M KEY INFORMATION – EPD II FUND SIZE AND INVESTORS Hard cap €250m Target size €200m (hard cap €250m), of which €131.5m already committed Investing in senior unitranche and s
Slide 13: An Advisory Board to Assist the Group in Its Strategic Decisions
AN ADVISORY BOARD TO ASSIST THE GROUP IN ITS STRATEGIC DECISIONS EQUITA APPOINTED LEADING INDEPENDENT EXPERTS TO ADVISE THE BOARD OF DIRECTORS AND MANAGEMENT THE LEADING INDEPENDENT EXPERTS OF THE ADVISORY BOARD OF EQUITA PAOLO BASILICO STEFANO MAINETTI ROBERTA NERI Italian entrepreneur, founder of
Slide 14: New Medium-Term Financing to Support Our Growth Strategy
NEW MEDIUM-TERM FINANCING TO SUPPORT OUR GROWTH STRATEGY UP TO EURO 30 MILLION TO FINANCE GROWTH PLANS THROUGH THE EXECUTION OF POTENTIAL M&A TRANSACTIONS AND INVESTMENTS IN NEW ALTERNATIVE ASSET MANAGEMENT PRODUCTS FINANCING FACILITIES – KEY TERMS TLA (TERM LOAN AMORTISING) RCF (REVOLVING CREDIT FA
Slide 15: Strong Positioning and Award-Winning Teams in All Areas
STRONG POSITIONING AND AWARD-WINNING TEAMS IN ALL AREAS (1) (2) Quality of Global 2° 1 1 context 1° 1° Service Market feel and 8% 7% 5% Focus on Mid 1 & Small Caps 1 knowledge Cash Fixed Equity 2020 FY’20 Equity Income Options Global 2020 1 Adding value 1 Idea generation Sales & to research Company
Slide 16: Leading Position in Investment Banking in Italy
LEADING POSITION IN INVESTMENT BANKING IN ITALY ITALIAN RANKINGS KEY RELEVANT TRANSACTIONS (2018 – YTD MAR’21) (3) # IPO / Listing (1) # deals 1. 4 2. IMI – Intesa Sanpaolo 4 (2018 – 2020) 3. Mediobanca 4 ECM 4. UniCredit Group 3 ACCELERATED BOOKBUILD OFFERING IPO IPO IPO IPO 5. Credit Suisse 3 6. G
Slide 17: Shortlist of Equita Initiatives with Social Impact
INVESTING IN A SOCIALLY RESPONSIBLE BUSINESS INVESTING IN EQUITA MEANS SUPPORTING INITIATIVES THAT BENEFIT THE SOCIETY Training & Corporate Remuneration on Employees Diversity … Education Welfare Meritocracy 6.600+ hours of Medical check-up, Quali-quantitative performance indicators, training in 201
Slide 18: Closing Remarks
Index CLOSING REMARKS
Slide 19: A Difficult Environment Presenting Strategic Opportunities
A DIFFICULT ENVIRONMENT PRESENTING STRATEGIC OPPORTUNITIES AN OVERALL DIFFICULT FRAMEWORK OFFERING INTERESTING STRATEGIC OPPORTUNITIES FOR EQUITA IN THE COMING YEARS AREA OPPORTUNITY ENABLING FACTORS AND KEY DRIVERS High market shares (#1 independent broker) Increase in brokered volumes Fixed Income
Slide 20: Next Steps
NEXT STEPS MANY INITIATIVES TO SUPPORT FURTHER FUTURE GROWTH IN ALL AREAS AREA INITIATIVES Further coordination of Global Markets area as a whole, with clear strategy and allocation of resources Global Further diversification of product offering as well as client base, increasing resiliency Markets
Slide 21: Road to 2022: Top Priorities and Targets
ROAD TO 2022: TOP PRIORITIES AND TARGETS (PLAN APPROVED IN NOVEMBER 2019) TOP 5 PRIORITIES KEY TARGETS FROM 2020-2022 STRATEGIC PLAN (@2022) GM €30m-34m Revenue Generation and Net Revenues 1 IB €30m-34m Diversification €75m AAM €8m-12m Cost Discipline and -500 bps in Cost/income 2 Focus on Profitabi
Slide 22: Resilient and Profitable Performance Thanks to Diversification
RESILIENT AND PROFITABLE PERFORMANCE THANKS TO DIVERSIFICATION NET REVENUES (€M) +6% CAGR ‘09-’20 in Net Revenues over the last 12 years 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Global Markets Investment Banking Alternative Asset Management NET PROFITS (€M) Always profitable, with
Slide 23: Annex
Index ANNEX
Slide 24: The Leading Independent Investment Bank in Italy
THE LEADING INDEPENDENT INVESTMENT BANK IN ITALY THE LARGEST INDEPENDENT TRADING FLOOR IN ITALY COMMITTED MANAGEMENT, UNPARALLELED ACCESS WITH INTERESTS FULLY TO CAPITAL MARKETS ALIGNED TO INVESTORS Independence as differentiating factor Clear and diversified business model STRONG PROFITABILITY TOP-
Slide 25: Story and Milestones
STORY AND MILESTONES The management team Incorporation of Equita Group Incorporation of of Equita SIM (which (HoldCo which owns 100% of Equita Capital SGR, Launch of already owns 49.5%) and Equita SIM). The management the management Listing of discretionary Alessandro Profumo buy acquires the majori
Slide 26: Clear Group Structure and Strong Management Commitment
CLEAR GROUP STRUCTURE AND STRONG MANAGEMENT COMMITMENT GROUP STRUCTURE (1) SHAREHOLDING STRUCTURE SHAREHOLDERS’ AGREEMENTS First Shareholders’ Agreement-Bis EQUITA AGM 30 shareholders with 48% of share GROUP 73% 27% Voting capital (≈65%(2) of votes following the kick-in of increased voting rights) r
Slide 27: Business Areas
BUSINESS AREAS Global Investment Alternative Asset Research Markets Banking Management Team We are the leading independent We offer high-profile advisory in We manage - via Equita Capital SGR - Our expert analysts support all other broker in Italy. We offer to extraordinary financial transactions, l
Slide 28: The Leading Independent Brokerage Firm in Italy
THE LEADING INDEPENDENT BROKERAGE FIRM IN ITALY COMPLETE AND DIVERSIFIED PRODUCT OFFERING (EQUITIES, BONDS, DERIVATIVES, ETFS) BUILT ON CLIENTS’ NEEDS. THE HIGH MARKET SHARES ACHIEVED OVER TIME CONFIRMED EQUITA’S COMPETITIVE ADVANTAGE POST MIFID II. CONSTANTLY RANKED AT THE TOP OF INVESTORS’ SURVEYS
Slide 29: Global Markets
GLOBAL MARKETS NET REVENUES (€M) +7% 37,1 Client Sales & Trading 33,7 30,6 30,5 31,5 Business Client Driven & Market Making 29,9 Directional Trading 25,8 21,8 24,4 20,8 21,4 +28% 21,5 +13% 9,0 Client-related 7,0 4,3 4,4 5,5 5,4 4,9 8,0 11,6 Business 7,0 3,1 (Growth % FY’20 vs FY’19) 3,1 5,3 (0,6) 2,
Slide 30: Best-in-Class Quality Research for Investors
BEST-IN-CLASS QUALITY RESEARCH FOR INVESTORS EQUITA CONFIRMED ITS EXTENSIVE COVERAGE OF LISTED SECURITIES, BOTH EQUITIES AND BONDS. CONSISTENTLY RANKED AT THE TOP OF INTERNATIONAL RANKINGS THANKS TO THE BREADTH AND QUALITY OF ITS RESEARCH EQUITA COVERAGE ITALIAN RANKINGS (2) Italy Research # of comp
Slide 31: Leader Among Independents in Investment Banking in Italy
LEADER AMONG INDEPENDENTS IN INVESTMENT BANKING IN ITALY THE LEADING INDEPENDENT PLAYER ON CAPITAL MARKETS IN ITALY AND CONSTANTLY RANKED AMONG TOP M&A ADVISORS BY NUMBER OF DEALS. SIGNIFICANT BENEFITS AND SYNERGIES FROM COVERING THE WHOLE SPECTRUM OF IB SERVICES UNIQUE AND COMPLETE PRODUCT OFFERING
Slide 32: Investment Banking
INVESTMENT BANKING NET REVENUES (€M) o/w €4.7m Equita K Finance o/w €2.7m +53% Equita K Finance 28,0 26,1 19,6 20,2 18,2 15,9 +4% 7,8 8,1 FY'15 FY'16 FY'17 FY'18 Q4'19 Q4'20 FY'19 FY'20 Performance drivers ECM transactions in Italy declined from 62 in 2019 to 57 in 2020 (o/w 51% executed in Q4’20) w
Slide 33: A 'Different' Asset Manager
A ‘‘DIFFERENT’’ ASSET MANAGER… EQUITA CAPITAL SGR, THE MANAGEMENT COMPANY OF EQUITA, LEVERAGES ON THE GROUP’S DIFFERENT AREAS OF EXPERTISE AND COMBINES SEVERAL DISTINCTIVE FEATURES THAT MAKE IT UNIQUE IN THE ITALIAN COMPETITIVE LANDSCAPE KEY DIFFERENCES BETWEEN EQUITA CAPITAL SGR AND COMPETITORS Ful
Slide 34: With a Clear and Diversified Growth Strategy
…WITH A CLEAR AND DIVERSIFIED GROWTH STRATEGY A CLEAR STRATEGY, FOCUSSED ON DIFFERENT PRODUCTS AND SERVICES OFFERED TO BOTH FINANCIAL INSTITUTIONS AND PROFESSIONAL INVESTORS. NOT INTERESTED IN TRADITIONAL ASSET MANAGEMENT AND WEALTH MANAGEMENT PARTNERSHIPS TO CO-DEVELOP PRODUCTS WITH BANKS, FINANCIA
Slide 35: Alternative Asset Management: Sound Performance
ALTERNATIVE ASSET MANAGEMENT: SOUND PERFORMANCE POSITIVE TRACK RECORD IN ALMOST ALL PRODUCTS THANKS TO STRONG EXPERTISE AND TOP-QUALITY IN-HOUSE RESEARCH. RESILIENT PERFORMANCE ALSO DURING THE MARKET TURMOILS OF 2020 A DIVERSIFIED SET OF PRODUCTS PORTFOLIO MANAGEMENT 1 YTD(1) Broad market recognitio
Slide 36: Alternative Asset Management
ALTERNATIVE ASSET MANAGEMENT NET REVENUES (€M) ASSET UNDER MANAGEMENT (€M) (6%) ex-performance fees Private Debt SPAC +7% ex-performance fees and investment portfolio Blueglen Total2 1.019 and investment portfolio 980 944 (24%) 49 39 100 Management fees PM 8,6 150 200 Performance fees PM (38%) 654 1
Slide 37: Covid-19 Response: Key Messages from the Outbreak of Pandemic
COVID-19 RESPONSE: KEY MESSAGES FROM THE OUTBREAK OF PANDEMIC OPERATIONS KEEP GOING SMOOTHLY THANKS TO INFORMATION TECHNOLOGY INVESTMENTS MADE DURING THE LAST FEW YEARS WHICH GUARANTEE CONTINUITY TO THE BUSINESS, AS WELL AS HEALTH AND SAFETY OF EQUITA PROFESSIONALS BUSINESS PROFESSIONALS SOCIAL INIT
Slide 38: The Influential Role of Equita on Financial Markets
THE INFLUENTIAL ROLE OF EQUITA ON FINANCIAL MARKETS EQUITA IS AN OPINION MAKER ON CAPITAL MARKETS AND HAS POSITIONED ITSELF AS THE LEADING EXPERT OF FINANCIAL MARKETS IN ITALY EQUITA ROLES AND INITIATIVES THAT PROMOTE THE DEVELOPMENT OF FINANCIAL MARKETS Pro-market regulatory Long-Standing Partnersh
Slide 39: Strong Track-Record in Executing M&A and New Initiatives
STRONG TRACK-RECORD IN EXECUTING M&A AND NEW INITIATIVES LEGACY BUSINESS VS NEW INITIATIVES (NET REVENUES FY’09 VS FY’20) Retail Hub €68m €68m Market Making 6 Fixed Income sales Investment Banking Global Markets New M&A & Advisory €36m Alt. Asset Management 38 Debt Capital Markets 34 €36m Initiative
Slide 40: Deal Structure and Key Impacts of Equita K Finance Acquisition
DEAL STRUCTURE AND KEY IMPACTS OF EQUITA K FINANCE ACQUISITION ACCRETIVE TRANSACTION IN TERMS OF EPS AND ROTE, WITH LIMITED IMPACT ON SOLVENCY RATIOS. IMPACTS EXCLUDE POTENTIAL COMMERCIAL SYNERGIES DEAL STRUCTURE AND KEY TERMS Acquisition of majority stake in the target (2020) Acquisition of remaini
Slide 41: Balance Sheet and Total Capital Ratio
BALANCE SHEET AND TOTAL CAPITAL RATIO LIGHT BALANCE SHEET AND HEALTHY CAPITAL STRUCTURE, WITH TOTAL CAPITAL RATIO WELL ABOVE REQUIREMENTS Equita Group (Consolidated) € m FY’20 H1’20 Q1’20 FY'19 9M'19 Cash & cash equivalents 0,0 0,0 0,0 0,0 0,0 Assets at FV to P&L & Equity investments 43,9 84,2 80,9
Slide 42: Equita Group
EQUITA GROUP Via Turati, No. 9 | Milan | 20121 Tel. +39 02 6204.1 | Fax +39 02 29001208/1202 info@equita.eu | www.equita.eu GLOBAL MARKETS | INVESTMENT BANKING | ALTERNATIVE ASSET MANAGEMENT | RICERCA