Gresham House Energy Storage Fund Plc GBP · LSE:GRID
Gresham House Energy Storage Fund Plc GBP — Gresham House — H1 2021 Earnings Presentation
46 slides from Gresham House Energy Storage Fund Plc GBP's earnings presentation, September 2021
Slide 1: Specialists in sustainable alternatives
Specialists in sustainable alternatives Gresham House plc Interim results presentation 30 June 2021 For professional investors only
Slide 2: Disclaimer
DISCLAIMER This presentation (the Presentation) is issued on a confidential basis by Gresham House for No representation is being made that any investment will or is likely to achieve profits or losses similar information purposes only. This Presentation, its contents and any information provided or
Slide 3: Presentation Team
PRESENTATION TEAM Tony Dalwood Kevin Acton Chief Executive Officer Chief Financial Officer ▪ Leads the Group and is Chairman of the Investment ▪ Oversees the Group finance function for Gresham Committee, overseeing balance sheet capital allocation House plc, including divisional entities ▪ Backgroun
Slide 4: Specialists in Alternatives
SPECIALISTS IN ALTERNATIVES Gresham House is a specialist alternative asset management group, quoted on the London Stock Exchange (GHE.LN / market cap c.£300m1), providing funds, direct investments and tailored investment solutions, including co-investment. Strategic Equity Real Assets New Energy
Slide 5: Contents
CONTENTS 2021 INTERIM RESULTS 6 GRESHAM HOUSE TODAY 13 STRATEGIC PRIORITIES 17 2021 PRIORITIES & CONCLUSION 23 APPENDIX 26
Slide 6: 2021 Interim Results
2021 INTERIM RESULTS
Slide 7: 2021 Interim Results
2021 INTERIM RESULTS £bn3 4.7 AUM → AUM up 19% in H1 to £4.7bn 4.0 £4.7bn £bn as at 30 June 2021 +19% → Organic AUM growth of £0.5bn an increase of 12% 2021 2020 £m4 → Net core income increased by 31% to £23.0m Net core income 23.0 £23.0m £m for the six months to 30 June 2021 → Investing in the busi
Slide 8: 2021 AUM Update
2021 AUM UPDATE as at 30 June 2021 AUM Net Fund Funds AUM £ millions Performance Total Growth Dec-20 Flows1 Acquired/Won Jun-21 Public Equity 508 53 149 255 965 90.0% Strategic Equity Private Equity 412 11 54 - 477 15.8% Subtotal 920 64 203 255 1,442 56.7% Forestry 1,811 25 149 - 1,985 9.6% New Ener
Slide 9: Interim 2021 AUM Update
INTERIM 2021 AUM UPDATE AUM progression for the half year to 30 June 2021 Strategic Equity ▪ AUM growth of £522m (+57%) ▪ Robust net fund inflows of £64m from open ended funds and Baronsmead VCTs ▪ Portfolio value increased by £203m as market recovers ▪ Appian acquisition adds £255m to AUM for Strat
Slide 10: Income Statement
INCOME STATEMENT Resilience growth in a challenging environment Income Statement 2021 2020 for the 6 months to 30 June £m £m ▪ Net core income +31% Net core income 23.0 17.5 Administrative overheads (16.0) (12.3) ▪ Long-term revenue streams - weighted (excl. Amortisation, Depreciation and Exceptiona
Slide 11: Balance Sheet
BALANCE SHEET A strong balance sheet Balance Sheet as at Jun 2021 Dec 2020 ▪ Tangible / realisable assets comprise cash and £m £m investments totalling £45.0m (2020: £45.1m) Assets Investments1 34.9 23.2 ▪ Cash of £10.1m (2020: £21.9m) Cash 10.1 21.9 ▪ Opportunities for balance sheet use in the next
Slide 12: Investments Aligned with Clients
INVESTMENTS ALIGNED WITH CLIENTS Strategic investment to align with clients and grow the business 2021 2020 Investment Portfolio £m £m Investment in associates ▪ GHS: 21% ROIC Gresham House Strategic plc (GHS) 11.0 8.4 ▪ GRID: 15% ROIC Noriker Power Limited (equity) - 0.7 ▪ DevCo Projects are batter
Slide 13: Gresham House Today
GRESHAM HOUSE TODAY “ ra
Slide 14: Supported by Strong Market Trends
SUPPORTED BY STRONG MARKET TRENDS ESG considerations 2019 2020 Change ▪ Interest in and active involvement with Sustainable Investment set to Investors considering ESG 55% 89% increase further Investors complying with regulation 56% 84% ▪ Gresham House well positioned at both product and group level
Slide 15: Creating Shareholder Value
CREATING SHAREHOLDER VALUE Continuing to develop through acquisition and organic growth Successful delivery of our business model creates long-term sustainable management fees and carried interest, creating value for clients and shareholders. Partnership with clients Deep understanding of our client
Slide 16: Strong Acquisition Track Record
STRONG ACQUISITION TRACK RECORD Management team have a strong track record of delivering acquisitions, generating growth and capturing synergies. ▪ Rigorous Investment Committee process for all acquisitions ▪ Must be in line with GH25 strategy ▪ Must achieve ROIC of 15% or greater in the medium term
Slide 17: Strategic Priorities
STRATEGIC PRIORITIES
Slide 18: Gresham House 5 Year Plan - GH25
GRESHAM HOUSE 5 YEAR PLAN - GH25 Financial targets Strategic targets → Double shareholder value → Leaders in ESG and sustainable investing → AUM £6bn+ → Majority investment products outperforming → EBITDA margins 40%+ → Significant market share in specialist products → ROCE 15%+ → Build on internati
Slide 19: Growth and 2021 Priorities
GROWTH AND 2021 PRIORITIES ✓ Fundraising for Gresham House UK Forestry Growth and Sustainability Fund LP and acquisition of forests for clients - raised £127m ❑ Launch New Zealand Carbon Credit opportunity in 2021 - Ongoing ✓ Continue to grow GRID in 2021 to fund acquisition of further utility-scale
Slide 20: Strategic Highlights
STRATEGIC HIGHLIGHTS ▪ Achieving international expansion through the completion of the acquisition of Appian Asset Management in Ireland and the expected completion of a further international forestry mandate in Australia, subject to regulatory approval ▪ Recognised for leadership in sustainable inv
Slide 21: Sustainable Investment Highlights
SUSTAINABLE INVESTMENT HIGHLIGHTS ▪ Gresham House Asset Management Limited has met the FRC’s expected standard of reporting in 2021 and been listed as a signatory to the 2020 UK Stewardship Code ▪ Sustainability Committee established by the Board which will be chaired by Gareth Davis ▪ Commenced a l
Slide 22: Acquisition - Mobeus VCT Business
ACQUISITION - MOBEUS VCT BUSINESS
Slide 23: Mobeus VCT Business
MOBEUS VCT BUSINESS ▪ Mobeus' VCT business manage four VCTs with AUM of £369m Mobeus AUM Growth as at 31 March 2021 380 369 360 ▪ Strong brand name 340 ▪ Team consists of 14 investment professionals, including 2 320 partners and five finance and middle office staff £ millions 300 287 ▪ VCTs are in t
Slide 24: Impact of Acquisition on Gresham House
IMPACT OF ACQUISITION ON GRESHAM HOUSE GH25 targets - financial impact AUM growth £6bn+ ✓ Adds £369m to AUM to 30 June 2021, plus funds raised since 30 June 2021 of £0.35bn increases pro forma AUM to £5.4bn Operating profit and margin of 40%+ ✓ Operating profit increases by £4.5m¹ (annualised) AUM F
Slide 25: Conclusion
CONCLUSION → Strong period of AUM growth in H1 2021 - AUM increased by 19% to £4.7bn → International expansion delivered through completion of Appian Asset Management acquisition → Sustainable Investment solutions continue to make a positive social impact → Targeted fundraising planned across all di
Slide 26: Appendix
APPENDIX
Slide 27: Our Purpose
OUR PURPOSE Deliver effective and alternative investment solutions to ensure clients achieve their financial objectives whilst making a meaningful contribution to advancing the world’s transition to a more sustainable way of life. Our commitment to integrating sustainable investment practices across
Slide 28: Management Committee
MANAGEMENT COMMITTEE Tony Dalwood Kevin Acton Chief Executive Chief Financial Officer Tony is an experienced public and private equity investor and adviser. He Kevin has over 19 years’ finance and operational experience in private established SVG Investment Managers (part of SVG Capital plc), acting
Slide 29: Non-Executive Board
NON-EXECUTIVE BOARD Anthony Townsend Richard Chadwick Non-Executive Director (Chairman) Non-Executive Director Anthony has spent over 40 years in the City and was chairman of the Association of Richard is a chartered accountant who was appointed to the Board of the Investment Companies (2001-2003).
Slide 30: Sustainable Investing Committee
SUSTAINABLE INVESTING COMMITTEE Rebecca Craddock-Taylor Bozkurt Aydinoglu Peter Bachmann Heather Fleming Matthew Giles Director, Sustainable Investment & Investment Director, Managing Director, Managing Director, Investment Director, Chair of the SIC New Energy Sustainable Infrastructure Institution
Slide 31: Investment Capabilities
INVESTMENT CAPABILITIES Capability Structure Target IRR / Total Return Target income Distribution cycle Inflation linkage Contractual cash flows Investment term Real Assets Infrastructure (BSIF) LP 8-10% Total Return 5.0-6.0% Quarterly2 ✔ - 12 years Housing (ReSI plc) Listed > 8% Total Return 5.0% Q
Slide 32: Recognition
RECOGNITION Winners Finalists ✓ Investment Week Fund Manager of the Year Award - Equities: UK Equity Income 2021 ✓ Money Age Asset Management Awards - Alternatives Investment Provider of the Year Awards - up to £100bn AUM 2021 ✓ Pensions Age Awards - Alternatives Manager of the Year 2021 ✓ PLC Award
Slide 33: The Growth Story
THE GROWTH STORY Interim Results 1070 30 June 2021 AUM £4.7bn GRID Placing Programme £107m raised 970 May-Oct GRID share issuance 2019 Results raised £120m 870 AUM £2.8bn 2017 Results Berkshire Pension Fund takes AUM £649m 20% stake at a premium and Run-rate Acquisition of TradeRisks 770 British Str
Slide 34: Organic Growth Timeline
ORGANIC GROWTH TIMELINE Gresham House appointed Gresham House British £25m top-up fundraising for Gresham House British investment manager of SPARK c.£100m placement of new Strategic Investment Fund LP Baronsmead VCTs closed in Strategic Investment Fund LP Ventures plc (rebranded Gresham equity in G
Slide 35: Acquisition Growth Timeline
ACQUISITION GROWTH TIMELINE Acquired Hazel Capital LLP, a Acquired the fund and investment Acquired Aitchesse Ltd. the leading new energy infrastructure management businesses of Livingbridge VC Acquired Appian Asset Management UK’s leading forestry asset business. Gresham House New LLP. Including tw
Slide 36: Real Assets £3,284m
REAL ASSETS Our Real Assets strategy invests in tangible assets, seeking to provide clients with sustainable yield and long term capital growth. Division AUM1 £3,284m 1. As at 30 June 2021
Slide 37: Gresham House Real Assets Team
GRESHAM HOUSE REAL ASSETS TEAM Housing (team of 23) Forestry (team of 29) Alex Pilato Olly Hughes Managing Director, Housing & Capital Markets Managing Director, Forestry ▪ 33 years’ industry experience ▪ 26 years’ industry experience ▪ Previously TradeRisks and JP Morgan ▪ Previously Head of Infras
Slide 38: Forestry
FORESTRY Diversifies an investment portfolio and provides exposure to timber and underlying land value growth with strong inflation linkage. ▪ A real asset class that both diversifies an investment portfolio and provides exposure to both timber and underlying land value growth ▪ The team seeks attra
Slide 39: New Energy
NEW ENERGY Returns are supported by strong asset backing, a sustainable income yield, and the potential for capital growth. ▪ Supporting the shift from reliance on finite resources to a new energy world powered by renewables, with the aim of generating sustainable long term returns ▪ Investments are
Slide 40: Sustainable Infrastructure
SUSTAINABLE INFRASTRUCTURE A defensive asset class, providing downside protection from asset backing, an attractive income stream that is often inflation-linked and providing positive impact. ▪ Targeting mid market (sub £50m) investments in local/regional projects where there is less competition to
Slide 41: Housing
HOUSING Secure, asset-backed, inflation linked income, aiming to deliver social dividend and wider positive social impact. ▪ The BSI Housing Fund invests in modern methods of construction, Help to Buy mortgages, and affordable private rented sector accommodation ▪ ReSI REIT focuses on independent re
Slide 42: Strategic Equity £1,442m
STRATEGIC EQUITY An investment philosophy applying a private equity approach to investing in both public and private companies. Division AUM1 £1,442m 1. As at 30 June 2021
Slide 43: Strategic Equity Team
STRATEGIC EQUITY TEAM Private Equity Public Equity Bevan Duncan Ken Wotton Managing Director, Strategic Equity Managing Director, Public Equity ▪ 16 years’ industry experience ▪ 19 years’ industry experience ▪ Previously Livingbridge and KPMG ▪ Previously Livingbridge and Commerzbank Steve Cordiner
Slide 44: Public Equity
PUBLIC EQUITY Takes a private equity approach to quoted smaller companies to deliver superior long-term returns. ▪ Targeting superior long-term returns in a range of public equity investments, engaging rigorous due diligence and developing a deep understanding of each investment ▪ Applies a private
Slide 45: Private Equity
PRIVATE EQUITY Access to entrepreneurial, high growth, earlier stage and lower mid- market private companies. ▪ Building on the spin-out of Baronsmead from Livingbridge to Gresham House, the investment team includes eleven investment professionals with specialist partners in talent and technology -
Slide 46: Gresham House plc Shareholders
GRESHAM HOUSE PLC SHAREHOLDERS Board / Management / Directors / Investment Committee & Advisory Group members c.10%1 The Royal County of Berkshire Pension Fund 14.2 Liontrust Asset Management 10.0 Amati Global Investors Ltd 4.7 Aberdeen Standard Investments 4.0 Richard C Dawson 3.9 Hargreaves Lansdo