Evli Plc Class B · OMXHEX:EVLI
Evli Plc Class B — Investor Presentation (February 2025)
59 slides from Evli Plc Class B's investor presentation, Feb 28, 2025
Slide 1: Evli European High Yield IB
EVLI EUROPEAN HIGH YIELD IB This is marketing material for the fund and is not intended as investment advice or recommendation. Before making an investment decision, the investor must read the fund's key information document and other statutory information about the fund. 28.02.2025 ISIN: FI40002332
Slide 2: Evli in Brief
2 EVLI IN BRIEF “We see wealth as an engine to drive sustainable progress.” CONFIDENTIAL
Slide 3: Evli Plc
3 ASSETS UNDER MANAGEMENT (EUR MARKET POSITION AS INSTITUTIONAL Evli Plc BILLION) DECEMBER 31, 2024 ASSET MANAGER (KANTAR PROSPERA 2024) Evli Plc is a Finnish independent investment service 18.9 1. company with a nearly 40-year operating history. We are currently Finland's leading institutional asse
Slide 4: Evli's mutual funds
4 Evli’s mutual funds FUND AUM (EUR BILLION) NUMBER OF FUNDS Funds are managed by Evli Fund Management DECEMBER 31, 2024 Company Ltd, which is a Finnish fund management company. Evli Fund Management Company is part of 13.4 64 Evli Group whose parent company is Evli Plc. Morningstar, an independent f
Slide 5: Award-winning asset management from Evli
5 Award-winning asset management from Evli Evli has been leading Kantar Prospera’s survey for 12 consecutive years in a row1. In the SFR Research’s Institutional Investment Services survey, Evli has been ranked first for five years and second place for three, based on the overall quality assessment2
Slide 6: Successful Fixed Income Management from Evli
6 SUCCESSFUL FIXED INCOME MANAGEMENT FROM EVLI The results of Evli’s corporate bonds family of funds CONFIDENTIAL
Slide 7: Evli's excellent corporate bond track record
7 Evli’s excellent corporate bond track record Quartile Rankings 4Q 2024* Historical returns are no guarantee of future returns. Morningstar Peer 3 5 10 15 Evli Fund Group Years Years Years Years EUR Ultra Short-Term Evli Euro Liquidity 1 1 1 1 Bond – The first credit fund, Evli Corporate Bond Fund
Slide 8: Evli's corporate bond funds in a nutshell
8 Evli’s corporate bond funds in a nutshell Fund Evli Euro Liquidity Evli Short Corporate Evli Nordic Corporate Evli Corporate Bond Evli Green Corporate Evli European Evli European High Yield Evli Emerging Markets Bond Bond Bond Investment Grade Credit Invests into Nordic ultra-short term Short date
Slide 9: Why Invest in European High Yield Bonds?
9 WHY INVEST IN EUROPEAN HIGH YIELD BONDS? Evli European High Yield CONFIDENTIAL
Slide 10: Evli European High Yield: Top Performer
10 Evli European High Yield: Top Performer Historical returns are no guarantee of future returns. - Long-term the fund has outperformed the available index products (and their benchmarks) - No investable index product for the fund’s benchmark - During the last 10 years the fund has outperformed the
Slide 11: Evli European High Yield Fund
11 Evli European High Yield Fund FUND Evli European High Yield Invests into European high yielding bonds – Fund Manager since launch Mr. Mikael Lundström Primary Rated €, £ HY bonds investments – Invests in corporate bonds of companies Non-rated issuers operating in Europe. Most of the investments a
Slide 12: Investment Philosophy and Process
12 INVESTMENT PHILOSOPHY AND PROCESS Evli European High Yield CONFIDENTIAL
Slide 13: Investment Philosophy and Strategy
13 Investment Philosophy and Strategy - Creditworthiness is the most important factor in selecting investment targets DISCIPLINED - We assess the TRUE credit quality, NOT relying on official rating - The coupon is a central part of the return - We invest in issuers that we like, regardless of their
Slide 14: Investment Process
14 Investment Process SCREENING COMPANY ANALYSIS PORTFOLIO >550 name ~250 names ~100 names universe* Investment universe: Company analysis: Overview and diversity: – European HY. Mostly € but can also be £, USD, – Financial Statement Analysis Diverse portfolio with 80-120 companies Nordic currencies
Slide 15: Company analysis
15 Company analysis – Main focus on companies that over the cycle: – generate consistent positive free cash flow – debt leverage decreasing & debt coverage increasing – Are priced at an attractive spread compared to their risk Management and other Interest Groups - Management’s abilities and future
Slide 16: How ESG is taken into account in investment decisions
16 How ESG is taken into account in investment decisions ESG factors will influence our analysis of the company, industry as well as our thoughts on the management and owners. Portfolio Managers - Focus on issues that are quantifiable in terms of credit quality - For example: Damage to brands, legal
Slide 17: ESG examples from Evli's corporate bond funds
17 ESG examples from Evli’s corporate bond funds ENVIRONMENTAL Will affect certain sectors more (oil, mining). Examples: - Invested in the Volvo Car new green bond as the company committed to a new industry leading electric strategy - Did not participate in Volkswagen Green bond issue due to UN Glob
Slide 18: Evli Fixed Income Team: Evli High Yield
18 Evli Fixed Income Team: Evli High Yield Mikael Lundström Einari Jalonen CHIEF INVESTMENT OFFICER AND PORTFOLIO MANAGER PORTFOLIO MANAGER At Evli since 1996. Specialised in corporate bond and fixed M.Sc. (Econ.) Einari has worked in the bank and income portfolio management. Mikael has invested in
Slide 19: Evli's fixed income team
19 Evli’s fixed income team Mikael Lundström Juhamatti Pukka Jussi Hyyppä Juhana Heikkilä Jani Kurppa Juha Mäntykorpi CHIEF INVESTMENT HEAD OF FIXED INCOME HEAD OF LOAN SENIOR PORTFOLIO SENIOR PORTFOLIO PORTFOLIO MANAGER OFFICER STRATEGIES MANAGER MANAGER AT EVLI SINCE 1996 AND AT EVLI SINCE 2008 AN
Slide 20: Evli European High Yield Fund in a Nutshell
20 Evli European High Yield Fund in a Nutshell Type of Fund European High Yield bond fund (UCITS) Benchmark ICE BofAML European Currency Developed Markets High Yield Constrained Index (HPCD) Fund Units Both distribution (A) and growth units (B), Institutional share class available (IB) B units EUR:
Slide 21: Considerations and Risk Factors
21 Considerations and Risk Factors The fund’s investment activities aim to achieve a higher long-term return on assets than the benchmark. The fund’s return expectation and risk are higher than for funds that invest solely in government bonds. The fund’s overall risk is also affected by the followin
Slide 22: Track Record and Portfolio Composition
22 TRACK RECORD AND PORTFOLIO COMPOSITION Evli European High Yield CONFIDENTIAL
Slide 23: Net of fee returns - 1 Year
23 Net of fee returns - 1 Year Portfolio Benchmark Difference 1 Month 0.80% 1.02% -0.22% 3 Months 2.16% 2.32% -0.16% 6 Months 4.70% 4.40% 0.30% 1 Year 9.31% 8.69% 0.61% Portfolio Benchmark Difference Volatility 1.37% 1.59% -0.22% Sharpe 4.00 3.06 0.94 Tracking Error 0.52% - - Information Ratio 1.17
Slide 24: Net of fee returns - 10 Years
24 Net of fee returns - 10 Years Portfolio Benchmark Difference 1 Year 9.31% 8.69% 0.61% 3 Years 16.96% 14.71% 2.25% 5 Years 16.98% 18.30% -1.32% 10 Years 40.77% 43.04% -2.27% 10 Years, 3.48% 3.64% -0.16% annualized return Portfolio Benchmark Difference Volatility 6.30% 6.10% 0.20% Sharpe 0.47 0.52
Slide 25: Annual returns, after fees, 28.02.2025
25 Annual returns, after fees, 28.02.2025 Past returns are no guarantee of future returns. 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 Portfolio 8.70% 7.43% -3.85% 8.31% -0.68% 3.65% -10.17% 12.56% 8.83% 1.71% Benchmark 8.84% 6.86% -3.74% 11.39% 2.54% 3.36% -11.10% 12.29% 8.15% 1.68% Differenc
Slide 26: Portfolio positioning and trades last 12 months
26 Portfolio positioning and trades last 12 months (March 2025) – The steeper yield curve supports 3-7 yrs BB-bonds – Spreads on BB’s are attractive and with the rise in yields all-in-yields are attractive on a 10-year horizon – The average bond price of the portfolio is 99.0– still scope for upside
Slide 27: Evli High Yield fund characteristics
27 Evli High Yield fund characteristics Past return is no guarantee of future returns Ratio 28.2.2025 Fund Index Yield (YTM) 6.08% 5.85% Yield to Worst (YTW) 5.79% 5.44% Modified duration 2.31 3.21 Rating Ba3/BB- Ba3/BB- OAS 360 299 No. of issuers 128 > 360 Source: Evli and ICE BofAML CONFIDENTIAL
Slide 28: Portfolio structure 28.02.2025
28 Portfolio structure 28.02.2025 Evli European High Yield IB CONFIDENTIAL
Slide 29: Top holdings 28.02.2025
29 Top holdings 28.02.2025 10 LARGEST INVESTMENTS 10 LARGEST ISSUERS % % Telefonica Europ 2.88% Perp/Call Variable 1.47% Nidda Healthcare Holding GmbH 2.11% Dynamo Newco Ii 15.10.2031 6.25% Callable Fixed 1.23% Altice France SA/France 1.47% Iliad Holding 15.4.2031 6.875% Callable Fixed 1.19% Telefon
Slide 30: Attribution 2024
30 Attribution 2024 - Portfolio outperformed by 109 bps (Gross-of-fees). - Best sectors were Real estate (overweight) and Technology (selection) - Weakest sectors were Transportation (Cabonline and Hurtigruten) and Financial services (Intrum) - Cash was a drag of 45bps (avg. weight 4.8%) as market r
Slide 31: Peer analysis – 3 years
31 Peer analysis – 3 years Past returns are no guarantee of future returns. Cumulative returns Evli European High Yield B The Upper Quartile Median The Lower Quartile 10% 5% 0% -5% -10% -15% -20% 2022-01 2022-07 2023-01 2023-07 2024-01 2024-07 Return (Cumulative) Beta Bear Beta Bull Beta Down Captur
Slide 32: ESG Metrics Q4 2024
EVLI EUROPEAN HIGH YIELD 32 ESG Metrics Q4 2024 Responsibility score A Carbon footprint 62 UN Global Compact 0,0 % SFDR classification: Article 8 (t CO2e/M$ sales) fails CURRENT RESPONSIBILITY SCORES CARBON FOOTPRINT AND FOSSIL FUEL RESERVES DEVELOPMENT OF CARBON INTENSITY OF CURRENT INVESTMENTS 99,
Slide 33: Ambition
33 AMBITION “We want to be the forerunner in responsible wealth management in the Nordics, and in this way help our clients in managing their wealth to support a sustainable future.” CONFIDENTIAL
Slide 34: Evli is a forerunner in Responsible Investing
34 Evli is a forerunner in Signatory of a COP15 initiative ’Moving Together on Nature’ Responsible Investing Signatory of Open Letter to EU leaders Joining the PRI Advance initiative as from investors on a endorser sustainable recovery Signatory of a from COVID-19 joint statement on European Investo
Slide 35: Four pillars of responsible investing at Evli
35 Four pillars of responsible investing at Evli #1 in Sustainable investing according to Finnish institutions 2017-20242 Principles for ESG 1 -integration in Engagement and Reporting Responsible Investment Team Responsible Investment investment process active ownership – Decided by Evli’s – Portfol
Slide 36: Monitoring, engagement and active ownership
36 Monitoring, engagement and active ownership ENGAGEMENT ACTIVITIES 2024 UN Global Compact, the UN Guiding Principles on Business and Human COLLABORATIVE ENGAGEMENT PARTICIPATING IN GENERAL Rights, the OECD Guidelines for Multinational Enterprises and Evli’s climate INITIATIVES MEETINGS principles
Slide 37: Exclusions in practice in all Evli funds
37 Exclusions in practice in all Evli funds – With 0% revenue threshold: – Controversial weapon manufacturers – Companies manufacturing peat for energy production – With 5% revenue threshold: – Tobacco producers, adult entertainment producers and companies practicing controversial lending – With 10%
Slide 38: Evli's climate change principles
38 Evli’s climate change principles 1. Analysis – Monitoring the emissions of companies in Evli’s funds through fund-specific carbon footprints. – Funds’ carbon footprints are also assessed by Evli’s Responsible Investment team. 2. Exclusion – Avoiding1 investments in companies that gain a significa
Slide 39: Evli's climate targets
39 Evli’s climate targets Evli aims for carbon neutrality of its own operations by 2025, and carbon neutrality of investments by 2050 at the latest. The interim target for the investments -50% reduction in indirect emissions from investments by 2030 (compared to 2019). We are aware that a credible l
Slide 40: What Opportunities Does the Market Currently Offer?
40 WHAT OPPORTUNITIES DOES THE MARKET CURRENTLY OFFER? Evli European High Yield - Overview of the market CONFIDENTIAL
Slide 41: Evli's funds vs. the market
41 Evli’s funds vs. the market 28.2.2025 8,0 Evli fund Evli Nordic Senior Secured Loan (AIF; 7.13%) Market 7,0 Evli Nordic High Yield (6.14%) Evli European High Yield (6.08%) 6,0 European Developed Markets High Yield Constrained Evli Emerging Markets Credit (5.15%) 5,0 Yield to maturity Evli Nordic
Slide 42: Market outlook
42 Market outlook – Germany’s decision to change their – The Q4 reporting season had a positive – The corporate bond market offers deficit policies impacted European yield tone from a credit investor’s attractive spreads and yield level curves significantly, new world order perspective leads to high
Slide 43: Benchmark total return % 2024
43 Benchmark total return % 2024 Historical returns are no guarantee of future returns. Source: ICE BofAML, Evli CONFIDENTIAL
Slide 44: Benchmark total return % YTD 2025
44 Benchmark total return % YTD 2025 Historical returns are no guarantee of future returns. Source: ICE BofAML, Evli CONFIDENTIAL
Slide 45: Spreads: BBB-rated IG in Europe
45 Spreads: BBB-rated IG in Europe (03/03/2025) Last 5 years Since 1999 Source: ICE BofAML, EVLI CONFIDENTIAL
Slide 46: Credit metrics (IG + HY)
46 Credit metrics (IG + HY) Net leverage (net debt to EBITDA) EBITDA margin Source: ICE BofAML, EVLI CONFIDENTIAL
Slide 47: Spreads: B-rated HY in Europe
47 Spreads: B-rated HY in Europe (03/03/2025) Last 5 years Since 1999 Source: ICE BofAML, EVLI CONFIDENTIAL
Slide 48: HY: Defaults expected to move slightly lower in 2025
48 HY: Defaults expected to move slightly lower in 2025 – Default rate trended higher since 2023 from historic low levels due to sharply higher funding costs but stabilized during H2 24 – Due to the healthy credit fundamentals and high balance sheet liquidity, expectations for defaults in Europe are
Slide 49: Credit metrics (IG + HY)
49 Credit metrics (IG + HY) Net leverage (net debt to EBITDA) Interest coverage Source: ICE BofAML, Evli CONFIDENTIAL
Slide 50: Credit metrics (HY)
50 Credit metrics (HY) Interest coverage Source: J.P. Morgan CONFIDENTIAL
Slide 51: HY: Defaults on the rise but loss rate stable
51 HY: Defaults on the rise but loss rate stable - Defaults are at moderate level but up from 2022 low levels - In a recession defaults tend to increase but due to the healthy credit fundamentals and high balance sheet liquidity, forecasts for Europe are moderate - Historically the rating agencies’
Slide 52: The European Credit Market
52 The European Credit Market Euro Investment Grade* European High Yield** Yield (%) 3.27 6.03 Modified Duration 4.43 3.22 Average Rating A- BB- Average price (%) 96.84 97.76 Spread to Government (bps) 101 317 Number of bonds 4347 714 Par value market size (bln €) 3134 389 *) ICE BofAML Euro Corpora
Slide 53: Company analysis and models (1/2)
53 Company analysis and models (1/2) – We use independent external research providers – Reorg, Lucror, CreditSights, etc. – Quarterly figures standardized by Cognitive credit – Currently covers 564 Euro HY issuers – Updated within minutes after figures released – Can build own financial models and f
Slide 54: Company analysis and models (2/2)
54 Company analysis and models (2/2) – We use own modeling and forecasts on case-by-case basis – We try to keep the models simple – Typically include a base case and bear case – Example case Loxam CONFIDENTIAL
Slide 55: At Your Service
55 AT YOUR SERVICE Our mission is to increase clients' wealth according to their individual targets. CONFIDENTIAL
Slide 56: At your service
56 At your service – Distinctive and comprehensive reporting - My Evli online service - Monthly fund reviews - Monthly custody statement - All Evli’s market and equity analysis - Quarterly ESG reports – Evli funds present on - Bloomberg, Citywire, Lipper, eVestment, Morningstar, Reuters, Sijoitustut
Slide 57: Important information
57 Important information This marketing material is intended for non-professional and professional clients in Finland, Sweden, Lithuania, Latvia and Estonia. In other jurisdictions this Document is intended only for professional clients. The management company of the fund is Evli Fund Management Com
Slide 58: Disclaimer statement
58 Disclaimer statement Evli This presentation is intended only for the recipient's personal and private use. This material is based on sources that Evli Group (Evli) considers correct and reliable. However, neither Evli nor its employees give any guarantee concerning the correctness, accuracy or co
Slide 59: Evli Funds social media and contact
LinkedIn – Evli Funds LinkedIn – Evli Funds Facebook – Evli Funds Facebook – Evli Funds Facebook – Evli Funds Message Service X – Evli Funds Message Service X – Evli Funds Message Service X – Evli Funds evli.com evli.com evli.com Evli Plc | Aleksanterinkatu 19 | P.O. Box 1081 | FI-00101 Helsinki, Fi