Capman Oyj Class B · OMXHEX:CAPMAN
Capman Oyj Class B — Q3 2008 Earnings Presentation
37 slides from Capman Oyj Class B's earnings presentation, Oct 30, 2008
Slide 1: CapMan Plc Interim Report January–September 2008
CapMan Plc Interim Report January–September 2008 Press and analyst conference 30 October 2008 Heikki Westerlund
Slide 2: Impact of current market situation on CapMan’s operations
Impact of current market situation on CapMan’s operations Fundraising: • Raising new funds has become more challenging during early autumn. Portfolio development: • Portfolio companies and real estate assets are expected to remain stable during the last quarter of 2008. Investment activity: • Invest
Slide 3: Impact of current market situation: Fundraising
Impact of current market situation on CapMan’s operations: Fundraising • Capital raised globally in Q3 2008 at lowest level since Q1 2005 • As distributions to LPs have slowed, more LPs approaching or above their target PE allocations • Around 70% of the LPs aim at investing in mainly existing manag
Slide 4: Impact of current market situation on CapMan’s operations
Impact of current market situation on CapMan’s operations Fundraising: • Raising new funds has become more challenging during early autumn. Portfolio development: • Portfolio companies and real estate assets are expected to remain stable during the last quarter of 2008. Investment activity: • Invest
Slide 5: Impact of current market situation: Portfolio development
Impact of current market situation on CapMan’s operations: Portfolio development • The slowdown in growth of the real economy has been seen in some of our investment targets, especially in those sectors that are linked to consumer demand. • Overall, our portfolio companies’ and real estates’ develop
Slide 6: Impact of current market situation on CapMan’s operations
Impact of current market situation on CapMan’s operations Fundraising: • Raising new funds has become more challenging during early autumn. Portfolio development: • Portfolio companies and real estate assets are expected to remain stable during the last quarter of 2008. Investment activity: • Invest
Slide 7: Impact of current market situation: Investment activity
Impact of current market situation on CapMan’s operations: Investment activity • At present the M&A market is waiting for the positive effects of banking sector support plans to materialise. • We believe that bank financing for buyouts, mergers & acquisitions and real estate investments will gradual
Slide 8: Clear decline in value of real estate transactions in Finland after Q1 2008
Clear decline in value of real estate transactions in the Finnish property market after Q1 2008 • Instability in debt markets has appreciably depressed the volume of real estate transactions. • Demand for prime real estate is still at a good level and the changed market situation could well open up
Slide 9: Impact of current market situation on CapMan’s operations
Impact of current market situation on CapMan’s operations Fundraising: • Raising new funds has become more challenging in early autumn. Portfolio development: • Portfolio companies and real estate assets are expected to remain stable during the last quarter of 2008. Investment activity: • Investment
Slide 10: Impact of current market situation: Exit market
Impact of current market situation on CapMan’s operations: Exit market • The exit market has at present come to a halt. • The impact of the crisis is visible in lower price levels. • Should there be any exits, at present they will most likely be through a sale to an industrial buyer. 10 30 October 2
Slide 11: CapMan – alternative asset manager in Nordic and Russia
CapMan – alternative asset manager in Nordic and Russia • Specialised listed alternative asset manager – Manages specialised third party private equity, venture capital and real estate funds – Listed on Helsinki Stock Exchange since 2001 – Market cap €149.8 million incl. A shares (closing price €1.8
Slide 12: CapMan’s growth strategy
CapMan’s growth strategy 2008 Expansion to Russia Establishment of a fund investing in public markets 2005 Expansion to real estate investments 2001–2004 Offices in Denmark, Sweden and Norway Public Market 2001 Listing in Helsinki Russia Stock Exchange Real Estate 1994 Life Science Real Estate MBO M
Slide 13: CapMan’s investment areas and latest funds
CapMan’s investment areas CapMan CapMan Private Equity €1.6 billion Real Estate €1.6 billion CapMan CapMan CapMan CapMan CapMan Buyout Technology Life Science Russia Public Market • Manufacturing, • Expansion and • Medical • Manufacturing • Nordic public • Commercial retail and later stage technolog
Slide 14: CapMan’s main events in 2008
CapMan’s main events in 2008 Two new investment areas 7 new portfolio company 6 exits from portfolio companies investments Four new funds 1 split of portfolio company €1,041 million raised 42 new real estate investments CapMan Technology 2007 CapMan Hotels RE Ky RUSSIA BALTIC PORK INVEST ASA CapMan
Slide 15: Components of income and operating costs
Components of income and operating costs 30 September 2008, M€ Total effect of own investments €-2.5 million Turnover 30.0 €27.2 million 0.3 0.2 4.1 0.0 25.0 1.7 20.9 -2.7 20.0 15.0 Operating profit €3.3 million 10.0 5.0 0.1 Pre-tax profit -21.2 €2.7 million -0.6 0.0 Management fees Income from real
Slide 16: Stable income covered operating expenses
Stable income covered operating expenses • Management fees paid by funds and the income from real estate consulting covered operating expenses in the review period. • Operating profit excl. carried interest and fair value changes of fund investments €1.9 million (€1.5 million). 10 M€ 8 6 4 7.9 7.8 7
Slide 17: Turnover and operating profit, M€
Turnover and operating profit, M€ Turnover Operating profit 60 60 51.6 50 50 43.6 40 40 35.6 31.4 28.1 26.5 29.8 30 27.2 30 25.4 19.5 20 20 10 7.2 10 3.7 3.3 0.4 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2007 2008 2007 2008 17 30 October 2008
Slide 18: Profit before and after taxes, M€
Profit before and after taxes, M€ Profit before taxes Profit after taxes 40 40 34.0 32.7 30 28.1 30 26.7 25.5 24.2 19.9 20.9 20 20 10 10 3.7 2.7 2.7 1.9 0.7 0.5 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2007 2008 2007 2008 18 30 October 2008
Slide 19: Management fees, M€
Management fees, M€ 30 • The amount of management fees grew from the review period 24.6 25 11.2%. 20.9 • Growth largely due to 20 18.8 establishment of the new CapMan Hotels RE real estate 15 13.6 fund. 12.5 10 5.8 6.3 5 0 1-3 1-6 1-9 1-12 2007 2008 19 30 October 2008
Slide 20: Carried interest, M€
Carried interest, M€ 23.6 25 • One exit (Staffpoint) was 22.4 21.2 21.4 made from funds generating 20 carried interest during the review period. • Carried interest for the 15 comparison period accrued primarily through the sale of 10 CapMan Real Estate I fund’s real estate portfolio. 5 4.1 4.1 0.0 0
Slide 21: Analysing short-term carried interest potential: funds generating carried interest
Analysing short-term carried interest potential: Funds generating carried interest / old funds 30 September 2008 Current portfolio at cost: €155.7 million Current portfolio at fair value: €136.6 million Current portfolios Buyout FV II FV III + III G Fenno Fund Fenno/Skandia I Fenno/Skandia II FM II
Slide 22: Funds generating carried interest: Finnventure V
Analysing short-term carried interest: Funds generating carried interest / Finnventure V 30 September 2008 Fund size: €169.9 million Portfolio at cost: €47.8 million Portfolio at fair value: €29.9 million Cash flow to investors: €237.7 million Generated carried interest to CapMan: €5.3 million Carri
Slide 23: Funds generating carried interest: CapMan Real Estate I
Analysing short-term carried interest: Funds generating carried interest / CapMan Real Estate I 30 September 2008 Fund size: €500.0 million Remaining investment capacity: €45.1 million* Portfolio at cost: €94.0 million Portfolio at fair value: €94.4 million** Cash flow to investors: €184.8 million**
Slide 24: Fund investments made from own balance sheet
Fund investments made from own balance sheet • Since 2002 CapMan has been a significant investor in the funds managed by the Group. • Depending on the funds’ demand and CapMan’s own investment capacity CapMan will invest in its future funds 2–10% of the funds’ total commitments. 140 M€ Remaining 120
Slide 25: The impact of own fund investments, M€
The impact of own fund investments, M€ • The impact on the Company’s result totalled € -2.5 million 10 – Realised returns €0.2 million (€0.4 million) 7.9 – Fair value changes € -2.7 million (€7.5 8 million) 6.2 • The changes were largely result of the general 6 market development in the review perio
Slide 26: Own investments and carried interest potential: CapMan Equity VII
Analysing impact of own investments and carried interest potential: CapMan Equity VII 30 September 2008 CAPMAN EQUITY VII A B C Sweden In total Fund size: 156.7 56.5 23.1 67.0 303.3 Paid-in capital: 135.0 53.9 16.1 57.8 262.8 Portfolio at cost: 85.0 34.0 10.0 36.4 165.4 Portfolio at fair value: 153.
Slide 27: Own investments and carried interest potential: CapMan Buyout VIII
Analysing impact of own investments and carried interest potential: CapMan Buyout VIII 30 September 2008 CAPMAN BUYOUT VIII A B In total Fund size: 360.0 80.0 440.0 Paid-in capital: 244.7 55.0 299.7 Portfolio at cost: 208.1 46.2 254.3 Portfolio at fair value: 209.9 46.6 256.5 CapMan’s commitment: €3
Slide 28: Turnover and result development
Turnover and result development € million 1-9/07 1-9/08 Capital under management (in the end of review period) 2,225.4 3,174.9 Turnover 43.6 27.2 Management fees 18.8 20.9 Carried interest income 22.4 4.1 Income from real estate consulting 1.6 1.7 Other operating income within turnover 0.4 0.3 The i
Slide 29: Income Statement
Income Statement € million 2004 2005 2006 2007 1-9/08 IFRS IFRS IFRS IFRS IFRS Turnover 27.7 28.7 38.0 51.6 27.2 Management fees 17.8 20.3 24.9 25.0 20.9 Carried interest 9.1 6.6 9.4 23.6 4.1 Income of investments in funds 0.2 0.5 0.9 0.5 0.2 Income from real estate consulting - 0.9 2.0 2.1 1.7 Othe
Slide 30: Key figures
Key figures 2004 2005 2006 2007 1-9/08 IFRS IFRS IFRS IFRS IFRS Earnings per share, € 0.06 0.09 0.15 0.24 0.02 Diluted, € 0.06 0.09 0.15 0.24 0.02 Shareholders’ equity / share, € 0.60 0.64 0.74 0.86 0.73 Dividend / share, € 0.06 0.07 0.12 0.16 - Dividend / result, % 94.4 78.0 80.0 67.0 - Dividends p
Slide 31: Fundraising and product development
Fundraising and product development • Substantial 45% growth in capital under management – Final closing of CapMan Technology 2007 at a level of €142.3 million – Fundraising for CapMan Hotels RE fund (currently €844.9 million) and CapMan Russia fund (€88 million) continues – After the review period,
Slide 32: Future outlook
Future outlook • Management fees and income from real estate consulting will cover CapMan’s fixed expenses in 2008. • Income from carried interest will be appreciably lower than the 2007 figure. – Despite the slowdown in the exit market, the funds still have exit processes in progress. – As a result
Slide 33: IR contacts
IR contacts Heikki Westerlund, CEO, Senior Partner tel. . +358 207 207 504 heikki.westerlund@capman.com Jerome Bouix, Senior Partner, Head of Investor Services tel. +358 207 207 558 jerome.bouix@capman.com Kaisa Arovaara, CFO tel. +358 207 207 583 kaisa.arovaara@capman.com Mari Maunula, Fundraising
Slide 34: Share price development and trading
Share price development and trading 140 120 100 80 60 40 20 0 -20 -40 -60 -80 -100 Nov-06 Dec-06 Nov-07 Dec-07 Nov-08 Feb-07 Feb-08 Mar-07 May-07 Mar-08 May-08 Jun-07 Jul-07 Jun-08 Jul-08 Oct-06 Jan-07 Oct-07 Jan-08 Oct-08 Sep-07 Sep-08 Apr-07 Aug-07 Apr-08 Aug-08 Relative CapMan Relative CapMan 200
Slide 35: All Senior Partners shareholders of CapMan Plc
All Senior Partners shareholders of CapMan Plc 30 September 2008 • CapMan Partners B.V. form the second largest shareholder and the largest user of voting rights Ownership of CapMan Plc Ownership of CapMan Plc Senior Partners (by shares) (by voting rights) 28% 39% 37% 6% 66% 24% Current 14 Senior Pa
Slide 36: CapMan’s ownership
CapMan’s ownership 30 September 2008, % of share capital • Nominee registered owners at the end of 2007 included funds managed by 29% several international investors 35% – Dunedin Enterprise Investment Trust Plc – Explora Capital Management ASA – Legg Mason Inc – Partners Group – Seventh AP Fund – R
Slide 37: CapMan Plc’s 12 largest shareholders
CapMan Plc’s 12 largest shareholders Share of all Share of all 30 September 2008 shares % voting rights % Aristo Invest Oy + Ari Tolppanen* 10.7% 14.5% CapMan Partners B.V. 6.2% 23.7% Winsome Oy + Tuomo Raasio* 4.6% 7.3% Vesasco Oy 4.2% 2.5% Heiwes Oy + Heikki Westerlund* 3.7% 3.9% Geldegal Oy + Oll