Duke Capital Limited · LSE:DUKE
Duke Capital — Duke Royalty — Investor Presentation (December 2023)
20 slides from Duke Capital's investor presentation, December 2023
Slide 1: Introduction to Duke Royalty
Introduction to Duke Royalty December 2023
Slide 2: Disclaimer
Disclaimer These presentation slides and the accompanying verbal presentation (the “Presentation Materials”), Republic of South Africa or the United States, its territories or possessions or in any other country are confidential and have been prepared by Duke Royalty Limited (the “Company”). They do
Slide 3: Introduction to Royalty Financing
Introduction to Royalty Financing Private business owners receive capital while retaining control of their business and continuing strategic direction making No refinancing risk Retain control of timing for owners of any refinancing event A long term approach Flexible structure to the business relat
Slide 4: What is Corporate Royalty Financing?
What is Corporate Royalty Financing? A long-term participating loan with similar characteristics to traditional royalties without taking a fixed percentage of revenue • Alternative financing with features of debt and equity, which allows company owners to keep control of their business without refin
Slide 5: Funding Solutions
Funding Solutions Key examples of how Duke’s funding solution has been used by owner-operators to drive growth and increase shareholder value Dividend Acquisition MBOs Recap/Equity Capital Releases Allows experienced We support owners who Flexible financing model management teams to want to take chi
Slide 6: Duke Royalty's Terms and Criteria
Duke Royalty’s Terms and Criteria Minimally-dilutive capital with no re-financing risk for long-standing, profitable, owner-managed companies • Cheque size of c.£5m-£25m Corporate royalty terms • 30-year participating loan, no bullet repayment • Senior security sought on available assets Senior secu
Slide 7: An Established Alternative Financing Solution
An Established Alternative Financing Solution Corporate royalties appeal to owners who need capital but want to retain control Debt Royalty Private Equity Term 3-7 years 25-40 years Permanent dilution Refinancing risk Significant None Pressure to exit Control Passive Passive Loss of control Covenant
Slide 8: Royalty Financing - Preservation of Equity Upside for Owners
Royalty Financing - Preservation of Equity Upside for Owners Shareholders benefit from superior accretion in equity value over time Year 1 Years 5-7 Years 8-10 Revenue: £10m / EBITDA: £4m Revenue: £20m / EBITDA: £8m Revenue: £30m / EBITDA: £12m Multiple: 5.0x Multiple: 6.0x Multiple: 7.0x Valuation:
Slide 9: Successful Exit Strategy Proven
Successful Exit Strategy Proven Exits form part of Duke’s funding model & validates the flexible form of capital June 2017 – • The lending relationship began in 2017 through Duke’s subsidiary, Capital Step for €500k to fund the Company’s December 2020 acquisition of ATS • Duke financed 6 different t
Slide 10: Successful Exit Strategy Proven
Successful Exit Strategy Proven Duke’s flexible capital aims to benefit business owners through various funding structures in order to grow equity value or alternatively, exit the business Duke first invested in the BHP Group in Duke invested in Xtremepush in 2018 for August 2018 as part of an MBO f
Slide 11: Duke's Typical Investment Process
Duke’s Typical Investment Process Duke has partnered with top tier management consulting firms to expedite due diligence and aims to complete transactions within two to three months Phase 1 Weeks 1 to 5 Weeks 5 to 7 Weeks 8 to 10 Sign non- Completion Due Definitive binding of Diligence Documents ter
Slide 12: An Experienced Team, Including Royalty Pioneers
An Experienced Team, Including Royalty Pioneers Management & investment committee have royalty experience of over 100 years Neil Johnson – Executive Director and CEO Charlie Cannon-Brookes – Executive Hugo Evans – CFO • 30 years of experience in financial Director and CIO • Extensive experience in s
Slide 13: Duke's Investors: Top Global Funds have Invested in Duke
Duke’s Investors: Top Global Funds have Invested in Duke Since listing on the London Stock Exchange in 2017, a range of blue-chip institutional investors have invested in Duke $9.5 trn $2.6 trn $1.0 trn $1.0 trn AUM AUM AUM AUM $650 bn $500 bn $430 bn $30 bn AUM AUM AUM AUM Duke has been funded by h
Slide 14: Meet Our Royalty Partners
Meet Our Royalty Partners —_ insider by DUKE be AWARDS 2021 bi ~4 ROYALTY WINNER
Slide 15: Our Royalty Partners
Our Royalty Partners Duke has proven experience investing across range of sectors, geographies and transaction types July 2023 November 2022 December 2021 December 2021 July 2021 INDUSTRIALS FIRE & SECURITY SPECIALIST CARE INDUSTRIALS INDUSTRIALS Invested to date: Invested to date: Invested to date:
Slide 16: Royalty Partner: Tristone Healthcare
Royalty Partner: Tristone Healthcare Transaction type Initial obligation Annual adjustment Initial Investment Term (incl. principal) (based on revenue) Debt Refinancing & £10.5m 30 years Acquisition 13.5% +/-6% Company overview • Tristone provides specialist residential and domiciliary care to i) hi
Slide 17: Royalty Partner: Atlas Signs
Royalty Partner: Atlas Signs Initial obligation Annual adjustment Initial Investment Term Transaction type (incl. principal) (based on revenue) £15.9m 30 years Debt Refinancing 12.5% +/-6% Company overview • Founded by the Adinolfe family in 1992, Atlas is a leading national sign branding company th
Slide 18: Royalty Partner: Fabrikat
Royalty Partner: Fabrikat Initial obligation Annual adjustment Initial investment Term Transaction type (incl. principal) (based on revenue) £6.2m 30 years MBO 14.0% +/-6% Company overview • 35 year history - largest independently owned manufacturer of lighting columns and guardrails in the UK; Mana
Slide 19: Support to our Royalty Partners
Support to our Royalty Partners Duke has a track record of supporting its Royalty Partners through the adversity caused by the Covid-19 Pandemic Management of cash Focus on business Grow and strengthen collections recovery existing businesses Structured forbearance agreements Ongoing board level Pro
Slide 20: Duke
MM. DUKE ROYALTY AWARDS 2021 &¥ WINNER 7)