B.p. Marsh & Partners Plc · LSE:BPM
B.p. Marsh & Partners — FY2016 Earnings Presentation
32 slides from B.p. Marsh & Partners's earnings presentation, Jun 7, 2016
Slide 1: Year End Results
Year End Results For the year ended 31 January 2016 Camilla Kenyon, Director & Head of Investor Relations Dan Topping, Chief Investment Officer Jonathan Newman, Group Finance Director 7 June 2016
Slide 2: Overview
Overview 25+ Years strong Specialist Robust balance sheet invested in 42 companies PE/VC investor in Financial Services intermediaries £5.3 million cash as at 31 January 2016 and realised 29 since 1990 £7.3 million realisation cash expected in July 2016 Industry knowledge Up to £3.5m per investment
Slide 3: 2016 Summary - Year End 31 January 2016
2016 Summary - Year End 31 January 2016 • As at 31 January 2016 – fourteen investments in • Equity Portfolio increase of 23.8% portfolio with a NAV of £70.8m (31 January 2015 since 31 January 2015 (15.5% • Dividend of 3.42p per share declared for £63m), with an average holding period of six years be
Slide 4: Performance: Net Asset Value (NAV)
Performance: Net Asset Value (NAV) Year ended : Net of deferred tax 70.81 65.50 Year ended 70 62.97 58.90 59.84 Six months ended 60 55.50 50 44.17 40.61 40 £ Millions 30 22.10 20 * NB: The valuation at 31 10 January 2007 includes £10.1m net proceeds raised on AIM 0 31st Jan 2005 31st Jan 2007* 31st
Slide 5: Dividends
Dividends • Over the past five years the Group has paid dividends as shown below. Total shareholder return from 31 January 2015 to 31 January 2016 is 13.7%. The dividend also forms part of the Group’s strategy to reduce the share price discount to NAV £1,200,000 £1.49 £1.60 £1.40 £1.35 £1,000,000 £1
Slide 6: Growth Strategy
Growth Strategy BP Marsh cash Our goal is to be the early stage capital provider Up to £3.5 m initially of choice to the financial services sector. We apply our sector expertise to source attractive long-term investment opportunities both in the Invest Take minority equity positions in promising ear
Slide 7: Investments
Investments Fair market value Movement in Year to Cost of equity Year of initial Movement in Year to Investment Sector 31 January 2016 Equity 31 January 2016 investment (£’000) investment 31 January 2016 (£’000) (£’000) Besso Insurance Broking 4,409 19,720 44.97% 1995 7,240 58.0% Summa Insurance Bro
Slide 8: Specific Activity within the Portfolio During the Year (I)
Specific Activity within the Portfolio During the Year (I) Further investment in Nexus throughout the year, which saw the Group’s shareholding Continuing strong financial performance; 2016 forecast of £37m revenue and over £6m of increase from 5% to 13.7% underlying EBITDA (the year ending 2015 achi
Slide 9: Specific Activity within the Portfolio During the Year (II)
Specific Activity within the Portfolio During the Year (II) Strong continued performance, resulting from introduction of pension freedoms, auto- Continued improving performance over 2015, reporting net revenues of €5.3m and EBITDA of €1.2m enrolment and defined benefit consultancy work 66% increase
Slide 10: Specific Activity New Investment Post Year-end
Specific Activity New Investment Post Year-end NEW INVESTMENT • Acquisition of 20% of Asia Reinsurance Brokers (Pte) Limited in April 2016 • Singapore headquartered independent specialist reinsurance and insurance risk solutions provider • Specialises in the provision of long-term reinsurance and in
Slide 11: International Strategy
International Strategy Summa Insurance Brokerage S.L. UK Based Investments B.P. Marsh’s international strategy is focused on those areas where we see sufficient opportunity for business development in partnership with a London-based investor coupled with a suitably developed regulatory and complianc
Slide 12: Investment Opportunities
Investment Opportunities RECENT AND CURRENT PROJECTS: • Investment opportunities in financial services intermediaries up to £3.5m (equity & MGAs – operating in niche specialisms, both start-ups and growth debt), minority positions (20-40%) businesses • Specialists in early-stage finance to ambitious
Slide 13: Investment Opportunities
Investment Opportunities • 71 new investment enquiries received in the period to 31 January 2016 (an increase of 20% on previous year) • 66% of investments continued to NDA stage and 28% to detailed investigations (33% in previous year) • 2 completed (Bulwalk Investment Holdings (PTY) Ltd & Property
Slide 14: Investment Process
Investment Process •Strong network of industry contacts brings us new opportunities •Each investment opportunity is scrutinised by the New Business Department •Suitable opportunities are then referred to be considered by the New Business Committee Initial •Next stage is for the opportunity to be cha
Slide 15: Adding Value Exit Strategy
Adding Value Exit Strategy Value creation driven by partnering with ambitious entrepreneurs seeking a partnership to Long-term investors provide growth capital and access to a team with a deep knowledge base in mergers, acquisitions, business sales, business growth and transformation, as well as the
Slide 16: Investments Financial Highlights – Year Ended 31 January 2016
Investments Financial Highlights –Year Ended 31 January 2016 Equity Portfolio value increase of 23.8% for the year ended 31 January 2016, 28.2% excluding Hyperion • NAV of £70.8m (31 July 2015: £65.5m, 31 January 2015: £63.0m) * • NAV per share of 243p (31 July 2015: 225p, 31 January 2015: 216p) * •
Slide 17: Investments Financial Highlights – Year Ended 31 January 2016
Investments Financial Highlights –Year Ended 31 January 2016 Average compound NAV growth of 11.4% p.a. since 1990 (excl. £10.1m raised on flotation)* Final Dividend of 3.42p per share declared (£1m) and paid on 29 July 2016 to Shareholders registered at the close of business on 1 July 2016 Share pri
Slide 18: Cash Position
Cash Position Cash at 1 Feb 2015 (including Treasury Funds) £7.9m Equity Investments £(5.2)m Proceeds from disposal of Investments £0.1m Loans granted £1.7m Loans repaid £4.6m Tax Repayment £0.2m Dividend Paid £(0.8)m Share repurchases £(0.1)m Other operating movements £0.3m Cash at 31 January 2016
Slide 19: Summary
Summary • Equity Portfolio increase of 23.8% since 31 January 2015, 28.2% excluding Hyperion • Final Dividend of 3.42p per share declared and paid in July 2016 and we intend to maintain that level • £3.6m of cash and treasury funds currently available for investment • Further cash of £7.3m expected
Slide 20: Appendices
Appendices 1. Management Team 2. Board Members 3. Portfolio 4. Minority Investor Protections 5. Financials 6. Major Shareholders 7. Contacts 20
Slide 21: Management Team
Management Team Brian Marsh OBE Alice Foulk Dan Topping ACIS MCSI Executive Chairman Managing Director Chief Investment Officer 50 years’ experience in insurance broking and underwriting. Alice Foulk joined B.P. Marsh in September 2011 having Dan joined B.P. Marsh in February 2007, following two yea
Slide 22: Management Team
Management Team Camilla Kenyon Jonathan Newman ACMA CGMA MCSI Director, Head of IR Group Finance Director Camilla Kenyon was appointed as Head of Investor Relations Jon is a Chartered Management Accountant with over 17 at B.P. Marsh in February 2009, having four years’ prior years’ experience in the
Slide 23: Board Members
Board Members Campbell Scoones Stephen Clarke FCA Pankaj Lakhani FCCA Non-Executive Deputy Chairman Non-Executive Director Non-Executive Director Campbell Scoones has over 45 years' experience in the A Chartered Accountant, Stephen gained many years’ A Certified Accountant, Pankaj Lakhani has over 4
Slide 24: Portfolio as at 31 January 2016
Portfolio as at 31 January 2016 Bastion Reinsurance Brokerage (PTY) • The Group invested in December 2014 Limited – 35% • Bastion specialises in the provision of reinsurance solutions over a number of complex issues, engaged by various insurance companies and managing general agents • February 1995
Slide 25: Portfolio as at 31 January 2016 Continued
Portfolio as at 31 January 2016 Continued • April 2007 invested in LEBC LEBC Holdings • LEBC is a national Independent Financial Advisory company providing services to individuals, corporates and partnerships principally in employee benefits, investment and life product areas and has 15 offices Limi
Slide 26: Portfolio as at 31 January 2016 Continued
Portfolio as at 31 January 2016 Continued Sterling Insurance (PTY) Limited – • Invested in June 2013, through the investment vehicle Neutral Bay Investments Limited 19.7% • Sterling is a Sydney-based specialist underwriting agency offering a range of insurance solutions within the Liability sector s
Slide 27: Minority Investor Protections
Minority Investor Protections • The Group believes that day-to-day operational control of the business is the domain of the executive management team. However, the Group’s position is well protected and portfolio investments are actively monitored • The Group outlines from investment the number of m
Slide 28: Consolidated Statement of Financial Position (IFRS) at 31 January 2016
Consolidated Statement of Financial Position (IFRS) at 31 January 2016 Audited Year to Unaudited 6 months to Audited Year to 31 January 2016 £’000 31 July 2015 £’000 31 January 2015 £’000 Tangible assets 15 15 18 Investments at fair value – Equity Portfolio 54,051 44,585 38,647 Treasury Funds 3,482
Slide 29: Consolidated Statement of Comprehensive Income (IFRS) at 31 January 2016
Consolidated Statement of Comprehensive Income (IFRS) at 31 January 2016 Audited Year to Unaudited 6 months to Audited Year to 31 January 2016 £’000 31 July 2015 £’000 31 January 2015 £’000 Gains on investments (realised and unrealised) 10,275 3,778 5,109 Impairment of investments and loans - - - Op
Slide 30: Consolidated Statement of Cash Flows (IFRS) at 31 January 2016
Consolidated Statement of Cash Flows (IFRS) at 31 January 2016 Audited Year to Unaudited 6 months to Audited Year to 31 January 2016 £’000 31 July 2015 £’000 31 January 2015 £’000 Net cash from operating activities 349 186 230 Taxation 201 201 (4,216) Purchase of property, plant and equipment (4) (1
Slide 31: Key Shareholders at 19 May 2016
Key Shareholders at 19 May 2016 DIRECTORS • Brian Marsh OBE - 57.4% • B.P. Marsh Management Limited – 4.86%* • Daniel Topping • Campbell Scoones Less than 0.1% each • Pankaj Lakhani * The Executive Directors hold the following beneficial joint interests in Ordinary Shares, held together with BP Mars
Slide 32: Contacts
Contacts B.P. Marsh & Partners PLC 2nd Floor 36 Broadway London SW1H 0BH Telephone: 020 7233 3112 Website: www.bpmarsh.co.uk Nominated Adviser & Broker Panmure Gordon & Co Telephone: 020 7886 2500 Financial PR Redleaf Communications Telephone: 020 7382 4730 32