Great Elm Group, Inc. · NASDAQ:GEG

Great Elm — Q3 FY2022 Earnings Presentation

34 slides from Great Elm's earnings presentation, May 6, 2022

  1. Slide 1: Great Elm Group Conference Call Presentation

    Great Elm Group, Inc. Conference Call Presentation Fiscal Third Quarter Ended March 31, 2022 May 6, 2022 NASDAQ: GEG

  2. Slide 2: Disclaimer

    edit Master title style Disclaimer Statements in this press release that are “forward-looking” statements, including statements regarding expected growth, profitability, acquisition opportunities and outlook involve risks and uncertainties that may individually or collectively impact the matters des

  3. Slide 3: Strategy and Business Operating Units

    edit Master Business title style Strategy Growth Strategy  Acquire management rights to permanent capital vehicles that  Focus on driving asset growth in GECC and Monomoy utilize the expertise of our Board, management, and financial  Increase AUM via new fund launches, SMAs and co-investments res

  4. Slide 4: Monomoy Properties Transaction

    edit Master title style Monomoy Properties Transaction Great Elm Group, Inc. | NASDAQ: GEG 4

  5. Slide 5: Transaction Overview

    edit MasterOverview Transaction title style GEG is entering the Private REIT Industry through the acquisition of management agreements for Monomoy Properties, as well as a strategic investment of up to $30 million  This is a transformative transaction for GEG’s investment management business: o Enc

  6. Slide 6: Strategic Considerations – Monomoy Manager

    editStrategic Key Master title style Considerations – Monomoy Manager Acquisition of Monomoy Manager provides GEG the management of a long duration capital vehicle with significant opportunity to accelerate growth in management and property fee income Considerations Commentary  Transaction gives GE

  7. Slide 7: Strategic Considerations – Monomoy REIT

    editStrategic Key Master title style Considerations – Monomoy REIT Underlying Monomoy REIT vehicle offers a unique portfolio of industrial property assets with significant runway for additional originations Considerations Commentary  GEG’s investment into the REIT represents the ability to own a pi

  8. Slide 8: Properties Overview of Monomoy

    edit Master Overview title style Properties of Monomoy Monomoy Properties REIT, LLC is a private REIT with a diversified portfolio specializing in net leased industrial real estate assets Currently maintains a portfolio of 108 owned properties, representing $348 million of real estate at fair value

  9. Slide 9: Geographical Diversity

    edit Master title Geographical style Diversity Monomoy Properties REIT, LLC manages a growing portfolio of 108 properties in mission-critical market across 27 states. (1) As of December 31, 2021 with some figures based on March 31, 2022 estimates Great Elm Group, Inc. | NASDAQ: GEG Source: Monomoy a

  10. Slide 10: Monomoy's Foundation

    edit MasterFoundation Monomoy’s title style Proprietary Sourcing & Due Diligence  Decades of industry experience and relationships  Deep dive credit analysis Strong Real Estate Markets  Favorable demographics  Positive underlying economic trends Reasonable Financial Leverage  Significant liquid

  11. Slide 11: Property Acquisition History

    edit MasterHistory Acquisition title style Property Acquisitions by Year Cumulative Property Acquisitions $110.0 $350.0 $100.0 $100.8 $90.0 $300.0 $300.6 $80.0 $250.0 ($ in Millions) ($ in Millions) $70.0 $60.0 $200.0 $60.0 $199.8 $50.0 $179.5 $150.0 $40.0 $47.7 $30.0 $100.0 $119.5 $33.6 $20.0 $26.9

  12. Slide 12: Current Tenants

    edit Master Current title style Tenants We believe that an integral part of our success is built on maintaining strong long lasting relationships with our tenants. Listed here are several of our top tenants. Great Elm Group, Inc. | NASDAQ: GEG 12

  13. Slide 13: Financial Details of Acquisition

    edit MasterFinancial Acquisition title styleDetails  The acquisition has two components: o Acquisition of Monomoy Manager for a purchase price of $10 million and potential earnout up to $2 million • Transaction will be financed with a combination of GEG and GECC shares and a seller note • ICAM has

  14. Slide 14: Fiscal 2022 Third Quarter Highlights

    edit Master title style Fiscal 2022 Third Quarter Highlights Great Elm Group, Inc. | NASDAQ: GEG 14

  15. Slide 15: Fiscal 2022 Third Quarter Highlights

    edit Master Fiscal title Quarter 2022 Third style Highlights Consolidated IM Operating Companies GECM acquired the investment management agreement for Monomoy DME grew revenue by 19% Properties REIT on May 5, year-over-year Great Elm grew revenue by 2022 Strong PAP resupply sales 20% year-over-year

  16. Slide 16: Consolidated Financials: By Quarter Summary

    edit Master title Consolidated style Financials: By Quarter Summary (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment org

  17. Slide 17: Consolidated Financials: Year-Over-Year Summary

    edit Master title Consolidated style Financials: Year-Over-Year Summary (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment

  18. Slide 18: DME – Operating Highlights

    edit Master Operating title style DME – Operating Highlights Companies:  In fiscal 3Q22, DME generated $15.6 million of revenue, a $6.6 million net loss and $2.5 million of Adjusted EBITDA1  Revenue increased due to continued organic growth in resupply sales and contributions from the AMPM and Med

  19. Slide 19: DME – By Quarter

    edit Master Operating title style DME – By Quarter Companies: (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment organizat

  20. Slide 20: DME – Year-Over-Year

    edit Master Operating title style DME – Year-Over-Year Companies: (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment organ

  21. Slide 21: Investment Management: A Scalable, High Margin Business

    edit MasterManagement: Investment title style A Scalable, High Margin Business AUM GROWTH HIGH MARGINS Grow GECC’s AUM through the AUM Growth Given the largely fixed cost nature of the issuance of additional debt and equity, Investment Management business, we supplemented by accretive acquisitions,

  22. Slide 22: Investment Management

    edit MasterManagement Investment title style In fiscal 3Q22, Investment Management generated Quarterly Highlight $1.0 million of revenue, a $4.0 million net loss and ($0.4) Adjusted EBITDA1 Great Elm Capital Management, Inc., a subsidiary of  Year over year revenue growth driven by an GEG, acquired

  23. Slide 23: Investment Management: By Quarter

    edit MasterManagement: Investment title style By Quarter (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment organization.

  24. Slide 24: Investment Management: Year-Over-Year

    edit MasterManagement: Investment title style Year-Over-Year (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment organizati

  25. Slide 25: Corporate: By Quarter

    edit Master General title style Corporate: By Quarter (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment organization. (2)

  26. Slide 26: Corporate: Year-Over-Year

    edit Master General title style Corporate: Year-Over-Year (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment organization.

  27. Slide 27: 3Q22 Consolidating Balance Sheets (Unaudited)

    edit Master Financial title style Review: 3Q22 Consolidating Balance Sheets (Unaudited) (1) Intercompany balances, including intercompany borrowings and GEG investments in subsidiaries. All intercompany balances eliminate in consolidation. Great Elm Group, Inc. | NASDAQ: GEG 27

  28. Slide 28: 3Q22 Consolidating Income Statement (Unaudited)

    edit Master Financial title style Review: 3Q22 Consolidating Income Statement (Unaudited) (1) Please refer to the disclaimers on slide 2 and the Adjusted EBITDA reconciliation tables in the Appendix. Great Elm Group, Inc. | NASDAQ: GEG 28

  29. Slide 29: Strong Shareholder Alignment

    edit Master Strong title style Shareholder Alignment  Employees of GEG/Great Elm Capital Management, Inc. (“GECM”) Employee Share Employee Share  Employees of GEG collectively own approximately 1.9 million shares of GEG, collectively own approximately 1.9 million shares of GEG, representing repres

  30. Slide 30: Appendix

    edit Master title style Appendix Great Elm Group, Inc. | NASDAQ: GEG 30

  31. Slide 31: Organization Structure

    edit Master title Organization: style Structure Great Elm Group, Inc. (“Great Elm” or “GEG”) (NASDAQ: GEG) Holds Former 20% ~20.4% 100% 80.1% 19.9% 80% JPM shares owners Great Elm Capital Forest Investments, Inc. Great Elm Capital Corp. Management, Inc. (“GECM”) Great Elm Durable Medical (“Forest”)

  32. Slide 32: Reconciliation: Non-GAAP

    edit Master Appendix: title style Reconciliation Non-GAAP (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with current segment organization.

  33. Slide 33: Reconciliation (cont.): Prior Year Period

    edit Master Appendix: title style Reconciliation (cont.): Prior Year Period Non-GAAP (1) Previously reported amounts below have been recast to reflect the full retrospective adoption of ASU 2020-06, Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity and to conform with cu

  34. Slide 34: Contact Information

    edit Master Appendix: title style Contact Information Investor Relations Contact: Michael Kim investorrelations@greatelmcap.com Great Elm Group, Inc. | NASDAQ: GEG 34

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