Capman Oyj Class B · OMXHEX:CAPMAN
Capman Oyj Class B — FY2008 Earnings Presentation
38 slides from Capman Oyj Class B's earnings presentation, Jan 29, 2009
Slide 1: CapMan Plc Group's result for 2008
CapMan Plc Group’s result for 2008 Press and analyst conference 29 January 2009 Heikki Westerlund
Slide 2: Impact of current market environment on CapMan's operations - overview
Impact of current market environment on CapMan’s operations - overview Raising new funds has become The exit market has at present more challenging. The prospects come to a standstill and the for growth in the demand for impact of the crisis is visible Fundraising alternative assets have remained in
Slide 3: General market trends: 2009 likely to be a challenging fundraising year
General market trends: 2009 likely to be a challenging fundraising year Global fundraising activity • Number of funds raised in 2008 down 26% from 2007 (value down by 12%) • Number of funds on the road remains record high at approx. 1,700 • Aggregate target for funds at the market $888 billion • Rec
Slide 4: General market trends: Investors still positive towards private equity in the long-term
General market trends: Investors still positive towards private equity in the long-term Global fundraising activity • Some LPs approaching or above their target private equity allocations as a result of to shrinking value of public holdings • Also slowing rate of distributions limiting investors mak
Slide 5: General market trends: Debt severely constrained in the European buyout market
General market trends: Debt severely constrained in the European buyout market European buyout activity • Average equity contribution for European buyouts increased to 43.9% in the first three quarters of 2008 from 33.6% in 2007. • We believe that bank financing for buyouts, mergers & acquisitions a
Slide 6: General market trends: Poor availability of debt financing reflected in decreasing leverage ratios
General market trends: Poor availability of debt financing is reflected in decreasing leverage ratios European buyout activity • Pure debt and multiple players likely to disappear from the market. • Long-term cooperation with Nordic banks is particularly important. Leverage ratios in European buyout
Slide 7: General market trends: Senior financiers in some recent buyout deals
General market trends: Senior financiers in some recent buyout deals Financier Example of deals done • Delisting of Gunnebo Industrier AB, Segulah, 7/08, EV M€ 217 • Delisting of Q-MED AB, EQT, 11/08, EV M€ 341 (debt by bank consortium leb by Nordea) • KMD A/S, EQT, 12/08, EV M€ 268 (50% debt by Nor
Slide 8: General market trends: Only slight shift downwards in buyout deal volume in the Nordic region
General market trends: Only slight shift downwards in buyout deal volume in the Nordic region Nordic buyout activity • Buyout deal value continued to decline in the Nordic region in line with the European trend Buyout deal value in the Nordic region Number of buyout deals in the Nordic region 30 100
Slide 9: General market trends: Clear decline in value of real estate transactions in Finland
General market trends: Clear decline in value of real estate transactions in the Finnish property market after Q1 2008 • Instability in debt markets has appreciably depressed the volume of real estate transactions. • Demand for prime real estate is still at a good level and the changed market situat
Slide 10: CapMan – alternative asset manager in Nordic and Russia
CapMan – alternative asset manager in Nordic and Russia • Specialised listed alternative asset manager – Manages specialised third party private equity, venture capital and real estate funds – Listed on Helsinki Stock Exchange since 2001 – Market cap €77.4 million incl. A shares (closing price €0.95
Slide 11: CapMan's growth strategy
CapMan’s growth strategy 2008 Expansion to Russia Establishment of a fund investing in public markets 2005 Expansion to real estate investments 2001–2004 Offices in Denmark, Sweden and Norway Public Market 2001 Listing in Helsinki Russia Stock Exchange Real Estate 1994 Life Science Real Estate MBO M
Slide 12: Latest funds
CapMan’s investment operations in a good position to implement their investment strategies CapMan CapMan Private Equity €1.8 billion Real Estate €1.6 billion CapMan CapMan CapMan CapMan CapMan Buyout Technology Life Science Russia Public Market • Manufacturing, • Expansion and • Medical • Manufactur
Slide 13: CapMan's main events in 2008
CapMan’s main events in 2008 2 new investment areas 8 new portfolio company 6 exits from portfolio companies investments 5 new funds €1,218 million raised 42 new real estate investments 1 split of portfolio company CapMan Technology 2007 THE NEW BLACK OY CapMan Hotels RE Ky RUSSIA BALTIC PORK INVEST
Slide 14: Main components of income
Main components of income Management company business Investment business Returns on direct Management fees Carried interest income fund investments from own balance sheet • Based on original fund size • CapMan begins to receive • Since 2002 CapMan has (total commitments) or fund’s carried interest
Slide 15: Components of income and operating costs
Components of income and operating costs 31 December 2008, M€ Total effect of own investments €-13.4 million 50.0 Turnover €37.1 million 0.7 0.3 40.0 4.1 29.6 2.4 30.0 0.1 20.0 Operating -13.7 profit/loss 10.0 €-6.3 million 0.0 -10.0 Profit/loss -29.8 -2.0 -2.4 before taxes -20.0 €-10.7 million Mana
Slide 16: Profitability of the management company business, M€
Profitability of the management company business, M€ 30 • Management company business generated a profit 25 23.5 23.6 • Operating profit excluding the 21.0 21.6 profit impact of fund 20 investments totalled €7.1 million in 2008 (€23.6 million). 15 • Profit for the comparison period accrued primarily
Slide 17: Stable income covered operating expenses
Stable income covered operating expenses • Management fees paid by funds and the income from real estate consulting covered operating expenses in the review period. 12 M€ 10 9.4 8.6 7.9 7.8 7.9 7.7 8 6.8 7.0 7.0 6.8 6.7 7.0 6.7 6.4 6.6 6.0 6 4 2 0 Q1/07 Q2/07 Q3/07 Q4/07 Q1/08 Q2/08 Q3/08 Q4/08 Mana
Slide 18: Turnover and operating profit, M€
Turnover and operating profit, M€ Turnover Operating profit 60 50 51.6 50 40 43.6 31.4 29.8 40 37.1 30 26.5 35.6 25.4 28.1 30 27.2 20 19.5 20 10 3.7 3.3 0.4 10 7.2 0 -6.3 0 -10 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2007 2008 2007 2008 18 29 January 2009
Slide 19: Profit before and after taxes, M€
Profit before and after taxes, M€ Profit before taxes Profit after taxes 40 40 34.0 32.7 30 28.1 30 26.7 25.5 24.2 19.9 20.9 20 20 10 10 3.7 2.7 2.7 0.7 0.5 1.9 0 0 -10 -10 -8.1 -10.7 -20 -20 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2007 2008 2007 2008 19 29 January 2009
Slide 20: Management fees, M€
Management fees, M€ 35 • The amount of management 29.6 fees grew from the review 30 period 18.4%. 25.0 • Establishment of the new 25 20.9 CapMan Hotels RE real estate 20 18.8 fund in January 2008 contributed to the increase in 15 13.6 management fees throughout 12.5 the year. 10 • The CapMan Public
Slide 21: Carried interest, M€
Carried interest, M€ 23.6 25 • One exit (Staffpoint) was 22.4 21.2 21.4 made from funds generating 20 carried interest during the review period. • Carried interest for the 15 comparison period accrued primarily through the sale of 10 CapMan Real Estate I fund’s real estate portfolio. 5 4.1 4.1 4.1 0
Slide 22: Fund investments made from own balance sheet
Fund investments made from own balance sheet • Since 2002 CapMan has been a significant investor in the funds managed by the Group. • CapMan strengthened its financial position in December 2008 by issuing a €20 million hybrid bond. The size of the bond can be increased to €30 million. 140 M€ Remaini
Slide 23: Exposure of own fund investments by investment area
Exposure of own fund investments by investment area • Depending on the funds’ demand and CapMan’s own investment capacity CapMan will invest in its future funds 2–10% of the funds’ total commitments. 60 M€ 50 40 30 20 10 0 Buyout Technology Public Russia Access Life Science Real estate Mezzanine Oth
Slide 24: The impact of own fund investments, M€
The impact of own fund investments, M€ • The impact on the Company’s result totalled 15 M€ -13.4 – Realised returns M€ 0.3 (M€ 0.5) – Fair value changes M€ -13.7 (M€5.7) 10 7.9 • The main factor affecting fair value changes 6.2 was the general market development, but the 4.4 4.9 weakening of the Swe
Slide 25: Analysing impact of own investments and carried interest potential: CapMan Equity VII
Analysing impact of own investments and carried interest potential: CapMan Equity VII 31 December 2008 CAPMAN EQUITY VII A B C SWEDEN IN TOTAL (buyout & tech) (buyout) (tech) (buyout & tech) Fund size: 156.7 56.5 23.1 67.0 303.3 Paid-in capital: 135.9 54.2 16.7 58.1 264.9 Portfolio at cost: 84.7 34.
Slide 26: Analysing impact of own investments and carried interest potential: CapMan Buyout VIII
Analysing impact of own investments and carried interest potential: CapMan Buyout VIII 31 December 2008 CAPMAN BUYOUT VIII In total Fund size: 440.0 Paid-in capital: 300.5 Portfolio at cost: 264.1 Portfolio at fair value: 224.1 CapMan’s commitment 37.5 CapMan’s share of carried interest 70% Read mor
Slide 27: Turnover and result development
Turnover and result development € million 1-12/07 1-12/08 Capital under management (in the end of review period) 2,190.0 3,407.5 Turnover 51.6 37.1 Management fees 25.0 29.6 Carried interest income 23.6 4.1 Income from real estate consulting 2.1 2.4 Other operating income within turnover 0.4 0.7 The
Slide 28: Income Statement
Income Statement € million 2004 2005 2006 2007 2008 IFRS IFRS IFRS IFRS IFRS Turnover 27.7 28.7 38.0 51.6 37.1 Management fees 17.8 20.3 24.9 25.0 29.6 Carried interest 9.1 6.6 9.4 23.6 4.1 Income of investments in funds 0.2 0.5 0.9 0.5 0.3 Income from real estate consulting - 0.9 2.0 2.1 2.4 Other
Slide 29: Balance sheet – Assets, IFRS
Balance sheet – Assets, IFRS €1,000 31.12.2007 31.12.2008 Non-current assets Tangible assets 819 1,064 Goodwill 4,845 11,762 Other intangible assets 1,001 3,229 Investments in associated companies 3,407 1,575 Investments at fair value through profit and loss Investments in funds 44,230 53,147 Other
Slide 30: Balance sheet – Total equity and liabilities, IFRS
Balance sheet – Total equity and liabilities, IFRS €1,000 31.12.2007 31.12.2008 Capital attributable the Company's equity holders Share capital 772 772 Share premium account 38,968 38,968 Other reserves 2,961 25,829 Translation difference 133 -226 Retained earnings 24,676 3,585 67,510 68,928 Minorit
Slide 31: Key figures
Key figures 2004 2005 2006 2007 2008 IFRS IFRS IFRS IFRS IFRS Earnings per share, € 0.06 0.09 0.15 0.24 -0.10 Diluted, € 0.06 0.09 0.15 0.24 -0.10 Shareholders’ equity / share, € 0.60 0.64 0.74 0.86 0.86 Dividend / share, € 0.06 0.07 0.12 0.16 0.00 Dividend / result, % 94.4 78.0 80.0 67.0 0.00 Divid
Slide 32: Fundraising and product development
Fundraising and product development • Substantial 56% growth in capital under management – First closing of CapMan Buyout IX was held on 22 December 2008 at €203 million, and its fundraising continues. The fund will start paying a management fee to as from its first investment. – Fundraising for Cap
Slide 33: Future outlook
Future outlook • Management fees and income from real estate consulting will cover CapMan’s fixed expenses in 2009. • Income from carried interest will depend on developments in the exit market. – Despite the slowdown in the exit market, the funds still have portfolio companies ready to enter the ex
Slide 34: IR contacts
IR contacts Heikki Westerlund, CEO, Senior Partner tel. . +358 207 207 504 heikki.westerlund@capman.com Jerome Bouix, Senior Partner, Head of Investor Services tel. +358 207 207 558 jerome.bouix@capman.com Kaisa Arovaara, CFO tel. +358 207 207 583 kaisa.arovaara@capman.com Mari Maunula, Fundraising
Slide 35: Share price development and trading
Share price development and trading 40 20 0 -20 -40 -60 -80 -100 2.10.07 2.11.07 2.12.07 2.10.08 2.11.08 2.12.08 2.1.07 2.2.07 2.3.07 2.4.07 2.5.07 2.6.07 2.7.07 2.8.07 2.9.07 2.1.08 2.2.08 2.3.08 2.4.08 2.5.08 2.6.08 2.7.08 2.8.08 2.9.08 2.1.09 Relative CapMan Relative CapMan 2003 B Relative OMX He
Slide 36: All Senior Partners shareholders of CapMan Plc
All Senior Partners shareholders of CapMan Plc 31 December 2008 • CapMan Partners B.V. form the second largest shareholder and the largest user of voting rights Ownership of CapMan Plc Ownership of CapMan Plc Senior Partners (by shares) (by voting rights) 28% 39% 37% 6% 66% 24% Current 14 Senior Par
Slide 37: CapMan's ownership
CapMan’s ownership 31 December 2008, % of share capital • Nominee registered owners at the end of 2008 included funds managed by several 29% international investors, e.g. 34% – Royce & Associates – Dunedin Enterprise Investment Trust Plc – Red Rocks Capital – INVESCO PowerShares Capital Management L
Slide 38: CapMan Plc's 12 largest shareholders
CapMan Plc’s 12 largest shareholders Share of all Share of all 31 December 2008 shares % voting rights % Aristo Invest Oy + Ari Tolppanen* 10.6 % 14.5 % CapMan Partners B.V. 6.1 % 23.6 % Winsome Oy + Tuomo Raasio* 4.6 % 7.3 % Vesasco Oy 4.1 % 2.5 % Heiwes Oy + Heikki Westerlund* 3.7 % 3.9 % Geldegal