Capman Oyj Class B · OMXHEX:CAPMAN
Capman Oyj Class B — H1 2011 Earnings Presentation
48 slides from Capman Oyj Class B's earnings presentation, Aug 11, 2011
Slide 1: CapMan result 1 January – 30 June 2011
CapMan result 1 January – 30 June 2011 Press and Analyst conference, 11 August 2011, Helsinki Lennart Simonsen, CEO, Senior Partner Jerome Bouix, Head of Sales, Marketing, IR and Communications, Senior Partner Niko Haavisto, CFO Certain statements included in this material, including, without limita
Slide 2: Contents
• CapMan in short Contents • Business environment • H1 activity and result 2 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
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 Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
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 for portfolio companies and real estate
Active owner for portfolio companies and real estate CapMan CapMan CapMan CapMan Buyout Russia Public Market Real Estate 35 portfolio companies and 59 real estate targets €5.4 billion 36,800 230 net sales personnel tenants 5 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 6: Demonstrated capability to create value
Demonstrated capability to create value 30 June 2011 • 2.9x money back multiple for investments in portfolio companies* • IRR 36% • Average holding period 5.4 years • 1.7x money back multiple for real estate investments** • IRR 50% (equity) • Average holding period 1.4 years * 75 exits by Buyout, Ru
Slide 7: 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 8: Our vision
Our vision By 2020 we are the best-performing European private equity firm 8 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 9: Strategy
Strategy CapMan’s strategy is to combine… …the …all strengths of capabilities entrepreneurial AND within partnerships… CapMan… …to provide excellent returns to investors. 9 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 10: Significant events in H1/2011
Significant events in H1/2011 • Q1 – New vision and mission – Updated strategy – Four key investment areas – New financial objectives • Q2 – Sale of real estate consulting business – Decision to close the Danish office 10 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 11: Contents
• CapMan in short Contents • Business environment • H1 activity and result 11 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 12: Investment operations
Investment operations 12 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 13: Deal volume and total value increased in the Nordic region
Deal volume and total value increased in the Nordic region Number of buyout deals Buyout deal value in the Nordic region in the Nordic region # €bn 100 30 25 80 63 20 60 35 15 40 €6.7bn 10 20 5 0 0 2005 2006 2007 2008 2009 2010 2011 2004 2005 2006 2007 2008 2009 2010 2011 Full year / Q1 Q2 Q3 Q4 Ful
Slide 14: Leverage ratios roughly at 2010 levels
Leverage ratios roughly at 2010 levels Leverage ratios in small & mid-sized transactions* 6,0x 5.6x 4.9x 4.7x 5,0x 4.7x 4.0x 4.0x 3.9x 4,0x 3.8x 3.6x 3.7x 3.5x 3.2x 3,0x 2,0x 1,0x 0,0x 2006 2007 2008 2009 2010 H1/2011 Debt/EBITDA Senior Debt/EBITDA * European buyouts (EV<250MEUR) Source: S&P LCD Eur
Slide 15: The value of real estate transactions in Finland amounted to approx. €1bn in H1/2011
The value of real estate transactions in Finland amounted to approx. €1bn in H1/2011 Development of transaction value in the Finnish commercial property market €bn 8 6 4 2 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 H1/2011 Source: KTI 15 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011
Slide 16: Fundraising
Fundraising 16 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 17: Fundraising is still at low levels
Fundraising is still at low levels... Capital committed to European private equity funds $bn # funds 160 120 140 100 …and is 120 expected to 80 100 remain 80 60 challenging 60 40 in 2011 40 20 20 0 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 Commitments # of funds Source: Preqin Quarterly Q2 2011
Slide 18: Real estate fundraising is also suffering
Real estate fundraising is also suffering… Capital committed to private equity real estate funds globally $bn # funds 160 300 140 …but LPs are 250 120 expected to 100 200 increase their 80 150 commitments 60 100 from 2010 40 50 20 0 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 Commitments # of fun
Slide 19: Investors continue to be positive towards private equity
Investors continue to be positive towards private equity Global demand, 100 international institutional investors interviewed Investors’ long term plans towards private Time frame for next intended commitments to equity investments private equity funds 100 % 3% 9% 13 % 16 % 80 % 39 % 2% 60 % 70 % 7%
Slide 20: The best areas for GP investment over the next 2 years – LP views
The best areas for GP investment over the next 2 years – LP views % 80 70 60 50 40 30 20 10 0 Large buyouts ($1 bn Mid-market buyouts Small buyouts (less Growth/expansion Venture capital or more) ($200 m-$999 m) than $200 m) capital North American deals European deals Asia-Pacific deals Source: Coll
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 Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 22: Contents
• CapMan in short Contents • Business environment • H1 activity and result 22 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 23: New investments in H1
New investments in H1 • New and add-on investments totalled €119.2 million • CapMan’s own investments in funds totalled €6.5 million – Majority in CapMan Buyout IX and CapMan Public Market funds • Two investments have been completed/communicated after the review period Investments after review perio
Slide 24: Exits in H1
Exits in H1 • Exits and partial exits at cost totalled €188.7 million • Cash flow from exits: – To investors approx. €272 million* – To CapMan approx. €23 million* • Exit from Å&R will take place after the review period Most significant exits completed in review period Exits after review period Part
Slide 25: Group turnover and operating profit
Group turnover and operating profit Turnover Operating profit / loss € million € million 40 38.2 30 29.7 21.0 30 20 21.0 9,2 20 10 15,7 6.0 4.3 4.0 4.5 11.4 10 8.2 0 0 -10 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2010 2011 2010 2011 25 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 August 2011
Slide 26: Components of income and operating costs
Components of income and operating costs 30 June 2011 € million 30 0.6 -17.5 10.3 25 Operating profit €9.2 million 20 0.4 0.5 1.0 15 13.9 2.4 Profit before tax €12.0 million 0.4 10 5 0 Management fees Income from real estate consulting Carried interest Other income Fair value gains and losses of inv
Slide 27: Management Company business' result slightly negative
Management Company business Management Company business’ result slightly negative € million 1-6/2011 1-6/2010 2010 • Management fees decreased as 15.7 21.0 38.2 expected from the comparison Turnover period Management fees 13.9 17.3 32.9 Real estate consulting 1.0 0.8 1.6 • No significant exits from
Slide 28: Management fees and carried interest
Management Company business Management fees and carried interest Management fees Carried interest € million € million 35 32.9 10 30 25.2 8 25 20 6 17.3 15 13.9 4 8.4 2.4 2.5 2.6 2.6 10 7.1 2 5 0.4 0.4 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2010 2011 2010 2011 28 CapMan Plc Group's Interim Report 1 Ja
Slide 29: CapMan's carried interest base
Management Company business CapMan’s carried interest base 30 June 2011 Portfolios at fair value (equity) by funds’ carried interest phase, in total €1.4bn 2% 15 % 13 % Funds generating carried interest, €28.3m Funds that are expected to start generating carried interest in 2011-2012, €184.7m Other
Slide 30: Analysing CapMan Equity VII A, B and Sweden
Management Company business Analysing CapMan Equity VII A, B and Sweden A Sweden B originally 65% buyout, 35% tech allocation 100% buyout Fund size ~paid in 156.7 67.0 56.5 capital, €m Capital returned to 138.8 59.7 64.0 investors, €m Remaining portfolio at fair 87.8 37.6 37.1 value, €m 30 CapMan Pl
Slide 31: Analysing CapMan Equity VII A, B and Sweden
Management Company business Analysing CapMan Equity VII A, B and Sweden 30 June 2011 • 8 companies in buyout portfolio – 3 companies have been partially exited • 10 companies in technology portfolio • Aggregate fair value of the portfolios: €162.5 million Buyout portfolio Technology portfolio Partia
Slide 32: 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 30 June 2011 CAPMAN BUYOUT VIII In total Fund size: €440.0m Paid-in capital: €365.1m Portfolio at fair value: €222.8m Cash flow to investors: €153.1m CapMan’s c
Slide 33: Improved result for Fund Investment business
Fund Investment business Improved result for Fund Investment business € million 1-6/2011 1-6/2010 2010 • Fair value gains, completed exits Fair value gains/losses and share of associated of investments 10.3 0.4 2.7 companies’ result contributed to Operating profit / loss 10.1 0.3 2.1 the result of F
Slide 34: Factors affecting the fair value development
Fund Investment business Factors affecting the fair value development Peer group (Nordic mid cap) trading in H1 2011 Other factors 300 OMX Nordic Mid Cap Financial performance of the companies 250 M&A transactions in the industry Preliminary exit negotiations 200 20.02.11 03.01.11 19.01.11 04.02.11
Slide 35: Changes in fair values of investments
Fund Investment business Changes in fair values of investments • Fair values of investments (CapMan’s own investments) – Change in H1 2011: €10.3 million or 16.9% – Change in Q2 2011: €6.2 million or 10.4% • Exits accounted for approximately half of fair value changes – In addition, the development
Slide 36: Fair values of investments
Fund Investment business Fair values of investments 30 June 2011 Changes in fair values of portfolio Changes in fair values of real estate companies in 2011* targets in 2011* 7% 5% 2% 3% 20 % 38 % 35 % 90 % New investments New investments Fair value increased Fair value increased Fair value as in 31
Slide 37: Fund investments and commitments totalled €93.2 million
Fund Investment business Fund investments and commitments totalled €93.2 million €m Majority of investments and commitments in buyout funds 60 50 40 30 20 10 0 Buyout, 59% Russia, 5% Public Market, 5% Real Estate, 7% Other, 17% Access, 7% 37 CapMan Plc Group's Interim Report 1 Jan - 30 Jun 2011 11 A
Slide 38: Key holdings for CapMan through own fund investments
Fund Investment business Key holdings for CapMan through own fund investments 30 June 2011 Company Business Net sales, Personnel** Fund(s) Investment M€* year Toiletries, household, CMB VIII wound care, and 240.4 800 2008 CMM IV healthcare products Technical laminates and protective 294.4 1,003 CMB
Slide 39: 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 Buyout, Russia, Public Market and Real Estate. Growth will be a natural outcome of high performance. Objectives Realised H1/2011
Slide 40: CapMan guidance – 2011 result
CapMan guidance – 2011 result • Our guidance remains unchanged. We expect operating profit for 2011 to exceed the 2010 operating profit, mainly as a result of positive development in CapMan’s own fund investments. Operating profit in 2010 was MEUR 6.3 excluding non-recurring items. • Our guidance as
Slide 41: IR calendar and IR team
IR calendar and IR team IR calendar 2011 IR team Q3 result Lennart Simonsen, CEO, Senior Partner Tel. +358 207 207 567 3 November 2011 lennart.simonsen@capman.com Jerome Bouix, Head of Sales, Marketing, Investor Relations and Communications, Senior Partner Tel. +358 207 207 558 jerome.bouix@capman.c
Slide 42: Additional slides
Additional slides
Slide 43: Key figures as of 30 June 2011
Key figures as of 30 June 2011 30 Jun ‘11 30 Jun ‘10 31 Dec ‘10 Earnings per share, cents* 8.9 4.6 17.7 Diluted, cents 8.7 4.6 17.7 Shareholders' equity / share, cents** 101.3 92.0 107.7 Share issue adjusted number of shares 84,255,467 84,281,766 84,255,467 Number of shares at the end of period 84,2
Slide 44: Group Income Statement
Group Income Statement € million 1-6/11 1-6/10 1-12/10 Turnover 15.8 21.0 38.2 Management fees 13.9 17.3 32.9 Carried interest 0.4 2.5 2.6 Real Estate consulting 1.0 0.8 1.6 Other income 0.5 0.4 1.1 Other operating income 0.6 0.1 23.0 Operating expenses -17.5 -16.9 -42.8 Fair value gains / losses of
Slide 45: Group Balance Sheet – Assets, IFRS
Group Balance Sheet – Assets, IFRS € thousands 30 Jun ‘11 30 Jun ’10 31 Dec ‘10 Tangible assets 506 704 602 Goodwill 6,190 10,245 6,406 Other intangible assets 2,114 2,677 2,424 Investments in associated companies 8,720 7,698 6,400 Investments at fair value through profit and loss Investments in fun
Slide 46: Group Balance Sheet – Total equity and liabilities, IFRS
Group Balance Sheet – Total equity and liabilities, IFRS € thousands 30 Jun ‘11 30 Jun ‘10 31 Dec ’10 Share capital 772 772 772 Share premium account 38,968 38,968 38,968 Other reserves 38,679 38,678 38,679 Translation difference 55 -317 69 Retained earnings 6,881 -585 12,241 Capital attributable th
Slide 47: CapMan's ownership
CapMan’s ownership 30 June 2011 6% 6% 22 % 33 % 25 % 13 % 17 % 44 % 34 % Nominee registered and foreign shareholders Management and employees of CapMan* Corporations Other shareholders Households Nominee registered shareholders Non-profit and public sector institutions CapMan Partners B.V. (CapMan's
Slide 48: CapMan Plc's largest shareholders
CapMan Plc’s largest shareholders 30 June 2011 Share of all shares % Share of all voting rights % Aristo Invest Oy + Ari Tolppanen* 10.3% 14.2% CapMan Partners B.V. 5.9% 23.1% Winsome Oy + Tuomo Raasio* 4.5% 7.2% Varma Mutual Pension Insurance Company 4.4% 2.7% Vesasco Oy 4.0% 2.4% Heiwes Oy + Heikk