Vinci Compass Investments Ltd. · NASDAQ:VINP
Vinci Compass Investments — Vinci Partners Investments — Q3 2024 Earnings Presentation
50 slides from Vinci Compass Investments's earnings presentation, Nov 7, 2024
Slide 1: Third Quarter 2024 Earnings Presentation
Third Quarter 2024 Earnings Presentation November 07, 2024
Slide 2: Disclaimer
Disclaimer This presentation contains forward - looking statements that can be identified by the use of words such as “anticipate,” “believe,” “could,” “expect,” “should,” “plan,” “intend,” “estimate” and “potential,” among others . By their nature, forward - looking statements are necessarily subje
Slide 3: Presenters
3 Presenters Alessandro Horta Chief Executive Officer Sergio Passos Chief Operating Officer & Chief Financial Officer Bruno Zaremba Private Equity Chairman & Head of Investor Relations
Slide 4: Opening Remarks
Opening Remarks
Slide 5: Vinci Partners Third Quarter 2024 Highlights
5 Vinci Partners Third Quarter 2024 Highlights See notes and definitions at end of document Vinci Partners ended the third quarter with R$70 bn in AUM², an 8% growth year - over - year, led by R$4.3 billion in capital subscriptions over the last twelve months mostly across Private Markets funds. We
Slide 6: Unlocking Growth: Strategic Partnerships and Acquisitions
6 Unlocking Growth: We are focused on complementing organic growth through strategic partnerships and acquisitions Combination with Compass Consolidating Vinci’s position as the gateway to alternative investments in Latin America. A natural step to expand Vinci’s geographic footprint into a Pan - re
Slide 7: Financial Highlights
Financial Highlights
Slide 8: Third Quarter 2024 Segment Earnings
8 Third Quarter 2024 Segment Earnings (Unaudited) See notes and definitions at end of document ∆ YoY(%) 3Q'24 YTD 3Q'23 YTD ∆ YoY(%) 3Q'24 2Q'24 3Q'23 (R$ thousands, unless mentioned) 8% 317,339 293,391 2% 106,750 114,134 104,745 Net revenue from management fees 34% 27,806 20,801 161% 5,966 11,481 2
Slide 9: Third Quarter 2024 Financial and Capital Metrics Highlights
9 ▪ Fee - related revenues of R$ 112 .7 million in the third quarter, up 5 % year - over - year, driven by stronger management and advisory fees. x Fee - related revenues of R$ 345 . 1 million in the 3Q’24 YTD , up 10% year - over - year. Management fees were R$ 317 .3 million in the 3Q’24 YTD , up
Slide 10: AUM 3Q'24 vs 3Q'23
10 AUM 3Q’24 vs 3Q’23 ( R$bn ) Long - Term AUM¹ 3Q’24 vs 3Q’23 ( R$bn ) Fee - Earning AUM 3Q’24 vs 3Q’23 ( R$bn ) We continue to expand AUM across the platform, with highlight to long - term products ▪ Total assets under management (AUM) of R$70.4 billion, up 8% year - over - year, driven by a combi
Slide 11: AUM and Revenue Mix by Strategy and Channel
11 37% 23% 20% 11% 9% Local Institutional³ Institutional Offshore⁴ HNWI⁵ Allocators & Distributors⁶ Public market vehicles⁷ 61% 17% 13% 9% 50% 34% 16% AUM 3Q’24 Our AUM base favors alpha - driven strategies, while our revenue profile is management fee - centric Our platform is highly diversified acr
Slide 12: Accrued Performance Fees in Private Market Funds
12 88% 7% 4% 1% Private Equity Vinci SPS Infrastructure Real Estate Vinci holds a strong long - term upside from realization of performance fees in private market funds Gross Accrued Performance Fees – Private Market Funds ▪ Accrued performance fees receivable of R$379.6 million in the 3Q’24, up 9%
Slide 13: GP Commitments Overview
13 Our GP Commitments are a long - term strong value creator ▪ As of 3Q’24, Vinci Partners had R$1,149.2 million in capital commitments signed to proprietary funds mostly across Private Eq uit y, Infrastructure, Credit and Real Estate. ▪ Realized investment gains are recognized quarterly as GP Inves
Slide 14: Fee Related Revenues
14 Fee Related Revenues ▪ Fee related revenues totaled R$112.7 million in the quarter, up 5% year - over - year. This increase was driven by a pickup in deal activity, leading to higher advisory fees and organic growth across Private Market strategies, which boosted management fees. ▪ Fee related re
Slide 15: Operating Expenses
15 Operating Expenses ▪ Total operating expenses of R$180.2 million during the 3Q’24 YTD, an increase of 6% when compared to the 3Q’23 YTD. Disregard ing Vinci Retirement Services, total operating expenses summed R$169.9 million, up 4% when compared to the 3Q’23 YTD, following our commitment to cost
Slide 16: Fee Related Earnings (FRE)
16 51 54 3Q'23 3Q'24 151 169 3Q'23 YTD 3Q'24 YTD Fee Related Earnings (FRE) ▪ FRE of R$169.4 million (R$3.19/share) in the 3Q’24 YTD, up 12% year - over - year on an absolute basis and 14% year - over - year on an FRE per share¹ basis. This growth was driven by stronger management and advisory fees.
Slide 17: Performance Related Earnings (PRE)
17 1.1 1.0 3Q'23 3Q'24 7.8 5.4 3Q'23 YTD 3Q'24 YTD Performance Related Earnings (PRE) ▪ Most of our open - end funds charge performance fees semiannually, recognizing revenues in June and December, thus first and third quarters usually are expected to show lower levels of performance from domestic o
Slide 18: Realized GP Investment and Financial Income
18 Realized GP Investment and Financial income ▪ Realized Financial income¹ of R$15.2 million in the 3Q'24, reflecting a 26% increase compared to the previous year, driven by hi gher realized gains in our liquid fund’s portfolio this quarter. ▪ Realized GP Investment² income of R$4.5 million in the
Slide 19: Adjusted Distributable Earnings (DE)
19 182 165 3Q'23 YTD 3Q'24 YTD 52 57 3Q'23 3Q'24 Adjusted Distributable Earnings (DE) ▪ Adjusted Distributable Earnings (DE)¹ of R$57.1 million (R$1.08/share) in the quarter, up 10% year - over - year on an absolute basi s and 12% year - over - year on an Adjusted DE per share² basis, driven mostly
Slide 20: Share Repurchase Activity and Balance Sheet Highlights
20 3Q'24 2Q'24 Share Repurchase Activity (in US$ million, unless mentioned) 374,834 220,135 Total Shares Repurchased (number of shares) 3.9 2.4 Total Capital Used for Share Repurchases 14.7 3.4 Remaining Share Repurchase Plan Authorization 6 10.4 10.8 Average Price Paid Per Share (US$) 3Q'24 2Q'24 (
Slide 21: Segment Highlights
Segment Highlights
Slide 22: Financials by Segment
22 68% 13% 14% 6% R$179 mm 71% 14% 15% 8% Private Markets IP&S Public Equities Corporate Advisory Financials by segment ▪ Fee Related Earnings (FRE), disregarding Vinci Retirement Services segment, were R$179.1 million in the 3Q’24 YTD, with 68% o f F RE coming from Private Markets, followed by IP&S
Slide 23: Private Markets
23 Private Equity 45% Real Estate 18% Credit 19% Infrastructure 11% Vinci SPS 7% Private Markets' AUM Private Markets R$35 bn AUM ▪ FRE was R$121.7 million in the 3Q’24 YTD, a 23% increase comparing to the 3Q’23 YTD. This growth was fueled by an increase in ma nagement fees revenue and catch - up fe
Slide 24: Investment Products & Solutions
24 See notes and definitions at end of document Separate Mandates 76% Pension Plans 8% International 7% Commingled Funds 9% IP&S' AUM Investment Products & Solutions ▪ Fee related earnings (FRE) of R$8.4 million in the quarter, down 2% year - over - year. FRE was R$24.9 million in the 3Q’24 YTD, a 4
Slide 25: Public Equities
25 Mosaico Strategy 68% Dividends Strategy 27% Total Return 5% Others 1% Public Equities' AUM Public Equities ▪ FRE was R$22.4 million in the 3Q’24 YTD, a decrease of 8% compared to the 3Q’23 YTD Pro Forma¹. Fee related earnings (FRE) of R$ 7.8 million in the quarter, down 9% year - over - year. ▪ P
Slide 26: Corporate Advisory Segment Earnings
26 ∆ YoY (%) 3Q'24 YTD 3Q'23 YTD ∆ YoY (%) 3Q'24 2Q'24 3Q'23 (R$ thousands, unless mentioned) N/A – – N/A – – – Net revenue from management fees 18% 23,506 19,954 147% 4,949 8,760 2,000 Net revenue from advisory fees 18% 23,506 19,954 147% 4,949 8,760 2,000 Total Fee Related Revenues 19% (1,763) (1,
Slide 27: Vinci Retirement Services Segment Earnings
27 ∆ YoY (%) 3Q'24 YTD 3Q'23 YTD ∆ YoY (%) 3Q'24 2Q'24 3Q'23 (R$ thousands, unless mentioned) 1,095% 561 47 498% 228 175 38 Net revenue from management fees N/A – – N/A – – – Net revenue from advisory fees 1,095% 561 47 498% 228 175 38 Total Fee Related Revenues 39% (1,991) (1,433) 32% (769) (661) (
Slide 28: Supplement Details
Supplement Details
Slide 29: AUM and Fee-Earning AUM Rollforward
29 AUM and Fee - Earning AUM Rollforward Assets Under Management (AUM) – R$ millions Fee - Earning Assets Under Management (FEAUM) – R$ millions For the Three Months Ended September 30, 2024 For the Three Months Ended September 30, 2024 For the Twelve Months Ended September 30, 2024 For the Twelve M
Slide 30: Investment Records: IP&S, Public Equities, Private Credit and Listed Funds
30 Investment records – IP&S, Public Equities, Private Credit and Listed Funds See notes and definitions at end of document Index Rate Market Comparison 24 M 12 M YTD 3Q'24 NAV¹ (R$ millions) Segment Fund CDI 7 CDI 7 22.5% 9.1% 6.1% 2.4% 180.6 IP&S Vinci Multiestratégia FIM CDI 7 CDI 7 12.5% 8.1% 4.
Slide 31: Private Markets Fund Returns (IRR and MOIC)
31 Gross IRR Gross IRR Gross MOIC Gross MOIC Total Value Unrealized Realized or Invested Capital Committed Capital Vintage year Segment Fund Partially Realized (USD) (BRL) (USD) (BRL) ( R$mm ) ( R$mm ) ( R$mm ) ( R$mm ) ( R$mm ) 77.2% 71.5% 4.0x 4.3x 5,209 99 5,110 1,206 1,415 2004 Private Equity Fu
Slide 32: Shareholder Dividends
32 Shareholder Dividends 3Q'24 2Q'24 1Q'24 4Q'23 3Q'23 2Q'23 1Q'23 4Q'22 ($ in thousands) 57,104 58,401 49,605 63,641 51,820 70,369 60,006 55,792 Adjusted Distributable Earnings (R$) 9,872 10,331 9,801 12,829 10,647 14,290 11,994 10,618 Adjusted Distributable Earnings (US$)¹ 0.19 0.19 0.18 0.24 0.20
Slide 33: Share Summary
33 Share Summary ▪ Common Shares Outstanding as of quarter end of 52,870,614 shares. x Repurchased 374,834 common shares in the quarter, with an average share price of US$10.4. x Repurchased 4,685,954 common shares since the announcement of the first share repurchase plan, with an average share pric
Slide 34: GP Commitment in Vinci Partners Funds
34 GP Commitment in Vinci Partners funds ▪ As of September 30, 2024, the company had R$1,149.2 million in capital commitments signed to proprietary funds. ▪ Total GP Investments marked at fair value of R$556.1 million as of September 30, 2024. See notes and definitions at end of document Fair value
Slide 35: Significant Exposure to Performance Fee-Eligible AUM
35 58% 22% 20% Private Markets Public Equities IP&S Significant exposure to performance fee - eligible AUM ▪ Total Performance fee eligible AUM (PEAUM) of R$39.6 billion. ▪ Hurdle rate funds charge performance based on the fund’s return over its benchmark, generally with a high - watermark clause, e
Slide 36: Reconciliations and Disclosures
Reconciliations and Disclosures
Slide 37: Financials - Income Statement
37 Financials - Income Statement See notes and definitions at end of document ∆ YoY (%) 3Q'24 YTD 3Q'23 YTD ∆ YoY (%) 3Q'24 2Q'24 3Q'23 (R$ thousands, unless mentioned) REVENUES 8% 317,339 293,391 2% 106,750 114,134 104,745 Net revenue from management fees (34)% 9,776 14,786 (8)% 1,890 5,613 2,058 N
Slide 38: Reconciliation of Operating Profit to FRE and DE
38 3Q'24 YTD 3Q'23 YTD 3Q'24 2Q'24 3Q'23 (R$ thousands, unless mentioned) 174,727 158,896 54,803 65,014 52,466 OPERATING PROFIT (13,259) (14,786) (1,890) (9,096) (2,058) ( - ) Net revenue from realized performance fees 3,483 – – 3,483 – ( - ) Net revenue from unrealized performance fees 4,419 7,026
Slide 39: Effective Tax Rate Reconciliation
39 3Q'24 YTD 3Q'23 YTD 3Q'24 3Q'23 (R$ thousands, unless mentioned) 151,180 191,175 55,062 42,192 Profit (loss) before income taxes 34% 34% 34% 34% Combined statutory income taxes rate - % (51,401) (65,000) (18,721) (14,346) Income tax benefit (Expense) at statutory rates Reconciliation adjustments:
Slide 40: General and Administrative Expenses
40 17.7 18.7 0.9 8.0 3.5 2.9 4.9 19.1 19.2 0.9 8.3 3.8 3.1 5.4 General and Administrative Expenses 3Q’24 ( R$mm ) 3 Q’23 ( R$mm ) Lease and condominium Other Personnel Bonus related to Mgmt. and Adv. fees Performance based compensation Third party expenses D&A R$59.8 mm Personnel Bonus related to Mg
Slide 41: Balance Sheet: Assets
41 09/30/2024 06/28/2024 Assets Current assets 534,406 592,308 Cash and cash equivalents 24,336 45,831 Cash and bank deposits 112,011 120,084 Financial instruments at fair value through profit or loss 398,059 426,393 Financial instruments at amortized cost 1,367,066 1,307,884 Financial instruments a
Slide 42: Notes and Definitions
42 Notes and Definitions ▪ Notes to page 5 (1) Per share is calculated considering the number of outstanding shares at the end of the current quarter. Year to date valu es are calculated as the sum of the last three quarters. (2) AUM is calculated as consolidated with double counting, due to funds f
Slide 43: Notes and Definitions (cont'd.)
43 Notes and Definitions (cont’d.) ▪ Notes to page 16 (1) FRE per share is calculated considering the number of outstanding shares at the end of the current quarter. Year to date val ues are calculated as the sum of the last three quarters. ▪ Notes to page 17 (1) PRE per share is calculated consider
Slide 44: Notes and Definitions (cont'd.)
44 Notes and Definitions (cont’d.) ▪ Notes to page 25 (1) In the First Quarter of 2024, Vinci Partners executed a strategic realignment across our segments, reassigning R$2.3 bill ion in AUM from our Hedge Funds business to IP&S, while allocating the remainder R$534 million in AUM to our Public Equi
Slide 45: Notes and Definitions (cont'd.)
45 Notes and Definitions (cont’d.) (6) Track record for FIP Infra is presented as of 2Q’24. (7) Track record for VIAS is presented as of 12’24. (8) Total commitments for VICC are presented as of 3Q’24. (9) Track record for VFDL is presented as of 3Q’24. (10) Track record for Vinci Credit Infra is pr
Slide 46: Notes and Definitions (cont'd.)
46 Notes and Definitions (cont’d.) (10) The CDI rate is a result of the average interbank overnight rates in Brazil (daily average for the period). (11) IMAB is composed by government bonds indexed to IPCA (inflation rate) plus a fixed interest rate. ▪ Notes to page 37 (1) Other items comprise the i
Slide 47: Notes and Definitions (cont'd.)
47 Notes and Definitions (cont’d.) ▪ “Fee related earnings”, or “FRE”, is a metric to monitor the baseline performance of, and trends in, our business, in a manne r t hat does not include performance fees, investment income and expenses that do not arise from our normal course of operations. FRE is
Slide 48: Definitions of Non-GAAP Measures
48 ▪ “Net revenue from Fund Management and Advisory” is a measure that we use to assess our ability to generate profits from our f und management and advisory business without measuring for the outcomes from funds above their respective benchmarks. We calculate Net Revenue from Fund Management and A
Slide 49: Funds/strategies' descriptions
49 Funds/strategies’ descriptions ▪ Vinci Multiestratégia : The fund seeks to achieve long - term returns by investing in fixed income assets, through strategies that imply interest rates and currency risks. ▪ Vinci Atlas: The fund seeks to achieve long - term returns by investing across all strateg
Slide 50: Office Locations
Rio de Janeiro 55 21 2159 6000 Av. Bartolomeu Mitre, 336 Leblon - 22431 - 002 São Paulo 55 11 3572 3700 Av. Brigadeiro Faria Lima, 2.277 14 o andar Jardim Paulistano - 01452 - 000 Recife 55 81 3204 6811 Av. República do Líbano, 251 - Sala 301 Torre A - Pina - 51110 - 160 Nova York 1 646 559 8000 780
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