B.p. Marsh & Partners Plc · LSE:BPM
B.p. Marsh & Partners — H1 2013 Earnings Presentation
27 slides from B.p. Marsh & Partners's earnings presentation, October 2013
Slide 1: B.P. Marsh & Partners Plc Interim Results
B.P. Marsh & Partners Plc Interim Results For the six months to 31 July 2013 Brian Marsh OBE, Chairman Jonathan Newman, Group Finance Director Dan Topping, Investment Director Camilla Kenyon, Director & Head of Investor Relations October 2013
Slide 2: Overview
Overview Niche Venture Capital provider focused on minority investments in financial services businesses, typically taking an equity stake of between 15% and 45% Geographic focus on UK, but also considers opportunities in EU, North America and Australasia Established in 1990 with funding of £2.5m —
Slide 3: Financial Highlights — Period Ended 31 July 2013
Financial Highlights — Period Ended 31 July 2013 » NAV of £56.9m (31 January 2013: £55.5m, 31 July 2012: £52.0m) » NAV per share of 195p (31 January 2013: 190p, 31 July 2012: 178p)* * Currently trading at a 25% discount to NAV (at close of 21 October 2013) * Consolidated profit after tax £1.4m (31 J
Slide 4: Other Key Developments — Cash Position
Other Key Developments — Cash Position * Cash Position = Cashat 1 Feb 2013 41.8m «+ £4.3m Directors Loan Draw Down «- £(2.3)m Acquisition — Sterling / R&Q -- £(3.4)m Loans granted — Besso / US Risk «+ £29.2m proceeds on Hyperion sale «- £(3.3)m loans granted — Hyperion «- £(4.3)m Directors loan repa
Slide 5: Performance: Net Asset Value (NAV)
i 60 50 40 30 20 10 Performance: Net Asset Value (NAV) 56.90 46.48 50.12 55.50 52.00 40.61 43.88 22.10 8.69 2.50 im 4.77 31stJan 31st Jan 31stJan 31stJan 31st Jan 31stJan 31stJan 31st Jan 31st July 31st Jan 31st July 90 GE} m YEAR ENDED mw SIX MONTHS ENDED 99 05 O7* 09 11 12 YEAR ENDED NET OF DEFERR
Slide 6: Performance: Net Asset Value (NAV)
Performance: Net Asset Value (NAV) 200 180 33% discount to NAV as at 31 July HSH 2013 140 120 100 Price and NAV comparators rebased to BPM share price Jan-07 Jul-O7_— Jan-08 = Jul-O8-— Jan-09. Jul-O9)s Jan-10. ss Jul-10.—s Jan-11._—s Jul-11)—sJan-12,)— ss Jub-12—s Jan-13_— Jul-13 ===BPM share price
Slide 7: Disposal in Period — Hyperion Insurance Group Limited
Disposal in Period — Hyperion Insurance Group Limited * Partial Disposal of Hyperion Investment " The sale of 80% of the Group’s holding in Hyperion to General Atlantic completed in July 2013 for £29.2m in cash. " The Group retains a 2.81% stake subject to a Call Option arrangement at £5.20 per shar
Slide 8: Acquisition in Period — Sterling Insurance Holdings PTY Limited
Acquisition in Period— Sterling Insurance Holdings PTY Limited Sterling is the Group’s most recent investment, undertaken through the investment vehicle Neutral Bay Investments Limited, which completed on 5 June 2013 Sterling, is a specialist underwriting agency and Lloyd’s of London Coverholder off
Slide 9: Case Study — Besso Insurance Group Limited
Case Study— Besso Insurance Group Limited * The Group has continually supported Besso with the provision of follow on funding, in its recent acquisitions *" Turkey - In May 2013 Besso bought the Turkish based reinsurance intermediary, specialising in aviation, HSB Sigorta ve Reasurans Brokerligi (“H
Slide 10: Summary of the Portfolio
Summary of the Portfolio Company Activity in Period [The Broucour Group Limited Revenues of £1.1m achieved to April 2013, up from £0.3m in 2012 after the| successful acquisition of Turner Butler in July 2012 ILEBC Holdings Limited 1.1m turn-around in profitability over the 2012 financial year, produ
Slide 11: Investments at July 2013
Investments at 31 July 2013 Investment Activity Cost of Fair Equity Year of Movement equity market i) initial in period investment value investment to 31.07.13 (£000) 31.07.13 (£000) (4000) Besso Insurance Group Limited | Insurance intermediary 2,618 5,898 | 36.7% 1995 675 The Broucour Group Limited
Slide 12: Other Key Developments — Investment Opportunities
Other Key Developments — Investment Opportunities 32 prospective new investments received in the period to 31 July 2013, this was compared to 38 in the period 31 January 2012 to 31 July 2012 The Group are currently in discussion with a number of companies in regard to possible investments, including
Slide 13: 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 matt
Slide 14: Adding Value
Adding Value " We believe in building strong relationships with the businesses we partner and using our expertise and experience in assisting them to achieve their growth targets and maximise shareholder value. We do so as follows: « Representation at Board level » Provision of follow-on funding « G
Slide 15: Exit Strategy
Exit Strategy = Exit considered on entry * Patient development to achieve full earning potential = Recognise and act on opportunistic situations 15
Slide 16: £22.4m cash at July 2013
£22.4m cash at 31 July 2013 Net cash after commitments of £15.3m Share price performed well in the Period The share price discount to NAV has narrowed, with the share price trading at a discount of 25% to NAV as at close on 21 October 2013 16
Slide 17: Management Team
Management Team Board Members Current Portfolio Financials Major Shareholders Contacts Appendices Az:
Slide 18: Management Team
Management Team Executive Chairman Brian Marsh OBE Group Finance Director Jonathan Newman ACMA CGMA MCSI Investment Director Dan Topping ACIS MCSI 50 years’ experience in insurance broking and underwriting. 1979-1990 was chairman and major shareholder of the Nelson Hurst & Marsh Group, the internati
Slide 19: Management Team
Director, Head of IR. Camilla Kenyon Investment Director Natasha Dunbar BBA Management Team Camilla Kenyon was appointed as Head of Investor Relations at BP Marsh in February 2009, having four years’ prior experience with the Company. Camilla holds two non-executive appointments, is Chair of the New
Slide 20: Board Members
Board Members Non-Executive Director Stephen Clarke Non-Executive Director Philip Mortlock Non-Executive Director Campbell Scoones A Chartered Accountant, Stephen gained many years’ experience with Charterhouse Development Capital in the structuring of venture capital projects in all fields includin
Slide 21: Current Portfolio
Current Portfolio Besso Insurance Group Limited- 36.5% The Broucour Group Limited — 49% Hyperion Insurance Group Limited — 2.81% LEBC Holdings Limited- 22.89% February 1995 the Group < establishing Besso, which speci Growth from revenue of £2.2m in 1995 to £26m in the year ended 31 December 2012 anc
Slide 22: Current Portfolio Continued
Paterson Squared LLC - 22.5% Portfolio Design Group International Limited - 20% Randall & Quilter Investment Holdings Limited - 1.35% Sterling Insurance PTY Limited — 19.7% Summa Insuran Brokerage, S.L. - 48.6% US Risk (UK) Limited — 29.3% Current Portfolio Continued Founded in September 2008 after
Slide 23: Consolidated Statement of Financial Position
Consolidated Statement of Financial Position (IFRS) at 31 July 2013 Unaudited 6 Audited Unaudited 6 months to Year to months to 31 July 2013 31 Jan 2013 31 July 2012 £000 £000 £000 Tangible assets 13 Th 10 Investments at fair value 27,344 BAL 47,998 Debtors / Loans receivable 16,187 9,761 8,946 Cash
Slide 24: Consolidated Statement of Comprehensive Income
Consolidated Statement of Comprehen Income (IFRS) at 31 July 2013 Unaudited 6 Audited Unaudited 6 months to Year to months to 31 July 2013 31 Jan 2013 31 July 2012 £000 sulle £000 Gains on Investments (Realised and Unrealised) 1,389 6,140. 2,224 Impairment of investments and loans - - - Operating In
Slide 25: Consolidated Statement of Cash Flows (IFRS)
Consolidated Statement of Cash Flows (IFRS) at 31 July 2013 Unaudited 6 Audited Unaudited 6 months to Year to months to 31 July 2013 31 Jan 2013 31 July 2012 £000 £000 £000 Net cash from operating activities 655 12 146 Taxation - - - Purchase of Property, plant and equipment (8) (1) - Investments ma
Slide 26: Key Shareholders
Key Shareholders = Directors » Brian Marsh OBE - 59.2% » Natasha Dunbar - 4.9% = Major Shareholders (>3%) « The Stephen Crowther Trust » Henderson Global Investors « IS Partners AG » AXA Framlington «James Sharp & Co 26
Slide 27: Contacts
Contacts B. P. Marsh & Partners Plc 24 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 Polhill Telephone: 020 7382 4730 27
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