Gresham House Energy Storage Fund Plc GBP · LSE:GRID
Gresham House Energy Storage Fund Plc GBP — Gresham House — FY2022 Earnings Presentation
29 slides from Gresham House Energy Storage Fund Plc GBP's earnings presentation, March 2023
Slide 1: A specialist partner for sustainable growth
A specialist partner for sustainable growth Gresham House plc Annual Results 2022
Slide 2: Notice to recipients
Notice to recipients 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 information purposes only. This Presentation, its contents and any information provided
Slide 3: Presentation team
Presentation team Tony Dalwood Kevin Acton Chief Executive 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 ▪ Background in fun
Slide 4: 2022 Annual Results and 2023 priorities
2022 Annual Results and 2023 priorities Tony Dalwood
Slide 5: Highlights
Highlights ▪ AUM growth of +20% to £7.8bn ▪ +34% growth in adjusted operating profit to £27.1mn Assets under Adjusted operating management profitability ▪ ROCE increased to 19.3%, in line at 31 December 2022 for the year to 31 December 2022 2020 £4.0bn 2020 £12.1mn with target 2021 £6.5bn 2021 £20.2
Slide 6: Highlights
Highlights 7.8bn +20% +34% Assets under management Growth in adjusted operating profit to £27.1mn (as at 31 December 2022) (year to 31 December 2022) 19.3% 55.2p +12% 16.0p +60% ROCE Adjusted diluted EPS Proposed dividend (year to 31 December 2022) (as at 31 December 2022) (pence) Past performance i
Slide 7: Specialists in alternatives
Specialists in alternatives Gresham House is a specialist alternative asset management group, quoted on the London Stock Exchange (GHE.LN), providing funds, direct investments and tailored investment solutions, including co-investment. ▪ Specialists in five areas of alternative investment ▪ Growin
Slide 8: Well-positioned for growth
Well-positioned for growth ▪ Long-term revenue stream visibility from long-term Gresham House asset classes in long-term vehicles - stable base to UK needs 20GW capacity grow the business battery energy 0.6GW operational storage by 20301 1.4GW pipeline ▪ Robust balance sheet with cash of £32mn and u
Slide 9: 2022 Annual Results
2022 Annual Results Kevin Acton
Slide 10: Highlights
Highlights ▪ +20% AUM growth to £7.8bn ‒ Organic growth of £1.1bn +17% ▪ Net core income growth of +25% to £77.3mn Assets under Adjusted operating management profitability at 31 December 2022 for the year to 31 December 2022 ▪ +34% adjusted operating profit growth to £27.1mn 2020 £4.0bn 2020 £12.1mn
Slide 11: 2022 AUM progression
2022 AUM progression Growth in the year: +£1.3bn (+20%) Continued AUM progression 8 ▪ Fundraising of +£0.8bn across all 0.2 7.8 divisions and distribution channels 0.3 ‒ Strategic Equity division +£0.2bn 7 ‒ Real Assets division +£0.6bn 0.8 ▪ Net performance growth of +£0.3bn £ bn 6.5 ‒ Equity marke
Slide 12: Quality and diversification of AUM
Quality and diversification of AUM AUM by strategy AUM by client AUM by fund ▪ Operate in specialist markets with average gross revenue 10% 14% 12% margin of c.1% 19% 29% 10% 36% 23% 24% ▪ Asset classes less correlated to equity market movements 43% 45% 35% ▪ Long-term lock up funds Public Equity Pr
Slide 13: Income statement
Income statement Net core income Resilient growth in a challenging environment £77.3mn +25% ▪ Net core income +25% to £77.3mn ▪ Long-term revenue streams - weighted average length of management contract of Adjusted operating margin 14 years on £2.5bn of AUM 35% ▪ Adjusted operating profit up 34% to
Slide 14: Balance sheet
Balance sheet A strong balance sheet: deployed for growth ▪ Cash and investments totalling £70.1mn £19mn Battery ▪ Cash of £32.2mn storage dev ▪ Undrawn committed RCF of £20.0mn projects £6mn GP commitments ▪ Investments in projects and funds to grow the business: ‒ Battery storage development proje
Slide 15: GH25 progress
GH25 progress Our five-year strategic plan
Slide 16: GH25 progress: financial targets
GH25 progress Financial targets Progress ▪ Double shareholder value AUM Operating margin 2020 £4.0bn 2020 29.6% ▪ AUM £8bn+ 2021 £6.5bn 2021 32.7% ▪ EBITDA margins 40%+ 2022 £7.8bn 2022 35.0% ▪ ROCE 15% increased to ROCE Dividend cover 20%1 over the medium term 2020 16.0% 2020 7.3x ▪ Dividend policy
Slide 17: GH25 progress: strategic targets
GH25 progress Strategic targets Progress ▪ Leaders in ESG and sustainable ▪ TCFD reporting, Stewardship Code, investing Best Sustainable Assets Fund at ▪ Majority of investment products Sustainable Investment Awards 2022 outperforming ▪ Continued outperformance ▪ Significant market share in ▪ Larges
Slide 18: Creating shareholder value
Creating shareholder value Continuing to develop through organic and acquisition 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 Remaining focused on Long-term a
Slide 19: Spotting growth opportunities
Spotting growth opportunities Track record of seeing the growth opportunities in niche alternative assets Regional co-investment 2022 saw us continuing to invest in: funds - Levelling up Battery energy storage International forestry Natural capital solutions Private equity growth capital - investing
Slide 20: Investment case and 2023 priorities
Investment case and 2023 priorities
Slide 21: Why invest?
Why invest? LP funds average c.90% of AUM in Quality of earnings and High gross revenue contract life: closed-ended / long-term revenue visibility margins: 1% 14 years listed vehicles International Delivering our Organic growth 17% Sustainability expansion strategic goals in 2022 leadership in ESG I
Slide 22: Why invest?
Why invest? Balance sheet capital Proven acquisition and Acquisition performance accelerates investment track record typically 20%+ ROCE AUM growth Senior management and LTIP aligned with GH25 delivery Long-term alignment employees own c.10% and shareholder value creation Past performance is not nec
Slide 23: The growth opportunity
The growth opportunity Gresham House’s asset classes demonstrate considerable potential for market growth Current position Pipeline Market opportunity New Energy 0.6GW capacity 1.4GW pipeline in GRID 20GW by 20301 Battery energy storage Sustainable £0.5bn capital committed £2.0bn pipeline £1tn acros
Slide 24: Fundraising pipeline
Fundraising pipeline Positive momentum in Q1 2023 £200mn+ raised ▪ GRID in the UK and Internationally New Energy ▪ SIReS ▪ Forestry LPs and segregated mandates in Forestry the UK and internationally Sustainable ▪ BSIF strategy Infrastructure Real Estate & ▪ Build-to-Rent and Shared Ownership Housing
Slide 25: Conclusion
Conclusion ▪ Strong period of AUM growth in 2022 - AUM increased by 20% to £7.8bn ▪ Strong adjusted operating profit growth of 34% to £27.1mn ▪ Increase shareholder value - adjusted diluted EPS +12%, 55.2p ▪ Proposed dividend +60% to 16p, 3.5x covered ▪ International expansion through Burlington acq
Slide 26: Q&A
Q&A
Slide 27: Get in touch
Get in touch Media relations Broker support Houston PR Canaccord Genuity Limited - Nominated Adviser and Joint Broker gh@houston.co.uk Bobbie Hilliam / Harry Pardoe +44 (0)20 4529 0549 +44 (0)20 7523 8000 Jefferies International Limited - Financial Adviser and Joint Broker Paul Nicholls / James Umbe
Slide 28: Income statement
Income statement Income Statement 2022 2021 Resilient growth in a challenging environment for the 12 months to 31 December £mn £mn Net core income 77.3 61.6 ▪ Net core income +25% to £77.3mn Administrative overheads (excl. Amortisation, Depreciation and Exceptional items) (49.6) (41.1) ▪ Long-term r
Slide 29: Balance sheet
Balance sheet Dec 2022 Dec 2021 A strong balance sheet: deployed for growth Balance Sheet as at £mn £mn Assets ▪ Cash and investments totalling £70.2mn Investments1 38.0 38.0 ▪ Cash of £32.2mn Cash 32.2 40.3 Tangible / realisable assets 70.2 78.3 ▪ Undrawn RCF of £20.0mn Intangible assets 87.3 95.0