B.p. Marsh & Partners Plc · LSE:BPM
B.p. Marsh & Partners — FY2024 Earnings Presentation
51 slides from B.p. Marsh & Partners's earnings presentation, Jun 11, 2024
Slide 1: Annual Results
Annual Results For the year ending 31 January 2024 Dan Topping, Chief Investment Officer Jon Newman, Group Finance Director 11th June 2024
Slide 2: Introduction to B.P. Marsh
Introduction to B.P. Marsh Our Purpose Our Team Our Story Our Investment B.P. Marsh is a specialist private We are a complementary team of B.P. Marsh was founded in 1990 Strategy equity investor in early stage highly experienced leaders in the and has since invested in 57 We take a long term view, w
Slide 3: Year Ending 31 January 2024 Results
Year Ending 31 January 2024 Results Consolidated profit Net Asset Value Change 31 January 2013 to 31 January 2024 before tax of (NAV) of £43.6m £229.2m 470 % Change 31 January 2010 to 31 January 2024 420 BPM share price 425% BPM NAV/share, rebased 408% +£25.7m, or 12.64% over six months 370 Year end
Slide 4: Performance: Net Asset Value (NAV)
Performance: Net Asset Value (NAV) 250 250 £229.17m £203.45m 200 £189.54m £179.77m £166.61m £154.98m £149.91m 150 £142.63m £136.90m £ Millions £126.17m £98.90m Full Year 100 Half Year £79.68m £70.81m *NB: The valuation at £62.97m 31 January 2007 includes £58.92m £55.46m £10.1m net proceeds 50 raised
Slide 5: Dividends
Dividends Historical £4.50 M £30.0M The Group paid an interim dividend of £1.0m in In aggregate: £24.8m March 2024 £4.00 M __ £25.0M Following the completion of the sale of Paladin £3.50 M February 2017: March 2024: Holdings Limited/CBC UK Realisation of Besso Realisation of Paladin £20.8M July 2013
Slide 6: Disposal: Paladin Holdings Limited / CBC UK Limited
Disposal: Paladin Holdings Limited / CBC UK Limited (“CBC") On 22 March 2024, the Group completed the sale of Paladin Holdings Limited, the holding company of CBC, to Specialist Risk Group Limited The Group originally invested £3,500 in Paladin/CBC Sale of Paladin/CBC: £42.1m alongside loan funding
Slide 7: Disposal: Paladin Holdings Limited/CBC UK Limited
Disposal: Paladin Holdings Limited/CBC UK Limited £120,000,000 Sale Price: £25,000,000 £108,931,000* £100,000,000 £20,000,000 £78,143,000 CBC/Paladin Revenue and EBITDA £80,000,000 £46,508,244 CBC/Paladin Valuation EBITDA: £10.3m £15,000,000 £60,000,000 2017: £3,500 Investment from B.P. £10,000,000
Slide 8: Disposal: Kentro Capital Limited
Disposal: Kentro Capital Limited ("Kentro") On 9 October 2023, the Group completed the sale of its stake in Kentro to Brown & Brown Inc Sale of Kentro: £51.5m The Group originally invested £1.5m in Kentro, known then as Nexus Underwriting Management Limited, for a 5% shareholding in August 2014 • £1
Slide 9: Disposal: Kentro Capital Limited
Disposal: Kentro Capital Limited ("Kentro") Nexus rebrands to Kentro Capital Limited, the holding company for both Nexus, the largest independent specialty managing general agent in the London market, and Xenia Broking, the 2023: 18.70% leading credit insurance and surety distribution specialist sha
Slide 10: Disposal: IFA Investments - Aspira Corporate Solutions Limited
Disposal: IFA Investments - Aspira Corporate Solutions Limited ("Aspira") • B.P. Marsh has been invested in LEBC Holdings • Upon completion B.P. Marsh received full repayment Limited (“LEBC”) , the Independent Financial Advisory of its £3.3m loans to LEBC company providing expert financial advice to
Slide 11: Shareholder Returns – Dividend & Share Buy-Backs
Shareholder Returns – Dividend & Share Buy-Backs Sale of Kentro & CBC It is the Board’s ongoing aim to strike a balance between long term capital growth and providing meaningful returns to Shareholders. £93.6m £24.8m in dividends proposed to be distributed since 2010 • £15.1m Equity invested • IRRs
Slide 12: New Investment Origination
New Investment Origination New Investment Opportunities to 31 January Our key investment Personal 2024, by sector: sourcing channels Connections Direct Fiducia was founded by a long A direct opportunity arose from standing contact of B.P. Marsh. the CEO of Pantheon Speciality, InsurTech The investme
Slide 13: New Investment – Pantheon Specialty Group Limited
New Investment – Pantheon Specialty Group Limited (“Pantheon”) NEW INVESTMENT Investment Date Specialist insurance brokerage Post year end, BP Marsh acquired a 7% further shareholding in June 2023 with access to the global insurance marketplace Pantheon for a consideration of £7.3m Equity Stake 25%
Slide 14: New Investment – Verve Risk Services
New Investment – Verve Risk Services (“Verve”) NEW INVESTMENT Investment Date London-based MGA specialising in Founded in 2016 by Scott Professional and Management April 2023 Liability business for the insurance industry in the US, Canada, Simmons and Alan Lambert, B.P. Marsh offered exclusive suppo
Slide 15: New Investment – Ai Marine Risk Limited
New Investment – Ai Marine Risk Limited (“Ai Marine”) NEW INVESTMENT Investment Date A Managing General Agency December 2023 specialising in Marine Hull insurance with a strong focus on the UK & Europe, Middle East, and Equity Stake Asia-Pacific regions 30% Founded by Charles Since inception, Ai Mar
Slide 16: New Investment – Devonshire UW Limited
New Investment – Devonshire UW Limited (“Devonshire”) NEW INVESTMENT Investment Date A Managing General Agency March 2024 specialising in underwriting transactional liability risks globally, excluding the US Equity Stake 30% Founded by four Provides risk solutions for We believe Devonshire is an exp
Slide 17: Insurance Intermediary Overview
Insurance Intermediary Overview B.P. Marsh’s insurance intermediary portfolio companies are budgeting to produce c. £1.27bn of aggregate Gross Written Premium (GWP) in 2024 The Group’s broking investments are budgeting to place c. £707m of GWP, producing c. £74m of brokerage in 2024, accessing speci
Slide 18: Overview: Managing General Agencies (MGAs) Investments
Overview: Managing General Agencies ("MGAs") Investments B.P. Marsh’s MGAs are budgeting to Internal rate Multiple on underwrite aggregate GWP of circa £562m Date of Equity % at 31 Cost of Valuation at % of NAV at of return to Invested in 2024 MGAs Investment Jurisdiction Jan 2024 Investment 31 Ja
Slide 19: Overview: Broking Investments
Overview: Broking Investments Since inception, much of B.P. Marsh’s Internal rate Multiple on growth has been underpinned by a Equity % at Cost of Valuation at % of NAV at of return to Invested successful track record of investing in Brokers Date of Investment Jurisdiction 31 Jan 2024 Investment 3
Slide 20: Investment Summary – XPT Group LLC
Investment Summary – XPT Group LLC ("XPT") B.P. Marsh originally invested XPT in numbers: GWP Growth (XPT Owned) £4.8m in June 2017 2024: Flood Risk Solutions • 2024 forecast Gross Written B.P. Marsh Value Premium of over US$880m A further investment of £2.5m Acquisition 2023: Cal Inspection Bureau,
Slide 21: Investment Summary – ATC Insurance Solutions
Investment Summary – ATC Insurance Solutions PTY Limited ("ATC") CURRENT INVESTMENT Investment Date A Managing General Agency with At investment, ATC produced GWP of July 2018 a specialism in Accident & Health, Construction & Engineering, Trade AU$ 61m Pack, Sports and niche motor insurance ATC curr
Slide 22: Investment Summary - Lilley Plummer Risks Limited
Investment Summary - Lilley Plummer Risks Limited ("LPR") CURRENT INVESTMENT Investment Date Marine broker, who has expanded Current valuation represents a October 2019 its product offering into several niche and diverse areas, including Political Violence and Terrorism, 92.1% Equity Stake North Ame
Slide 23: Investment Summary - Stewart Specialty Risk Underwriting Ltd
Investment Summary - Stewart Specialty Risk Underwriting Ltd ("SSRU") CURRENT INVESTMENT Investment Date A Managing General Agency, Since launch SSRU has shown robust providing a variety of Property and January 2017 growth Casualty products to a wide array of clients in the Construction, SSRU antici
Slide 24: Market Overview
Market Overview GLOBAL FINANCIAL B.P. Marsh continues to monitor trends in the rate of pricing for GLOBAL PROPERTY GLOBAL CASUALTY & PROFESSIONAL insurance business placed in the areas where the portfolio operates Global commercial insurance rates increased by 1% in Q1 2024, the 26th consecutive qua
Slide 25: Our Current International Portfolio
Our Current International Portfolio B.P. Marsh’s international strategy is focused on areas where we see: • Sufficient opportunity for business Canada: US: development in partnership with a Stewart Specialty Risk XPT Group LLC Underwriting Ltd London-based investor SAGE Program • A suitably develope
Slide 26: Financial Highlights – Year Ended 31 January 2024 (audited)
Financial Highlights – Year Ended 31 January 2024 (audited) Net Asset Value (NAV) of NAV per share of 629.0p +19.5% over year 22.0% Total £229.2m (626.9p* diluted) Shareholder Return +£25.7m over six months Including NAV uplift and total dividend of £2.0m paid Feb 2023/Jul 2023/Nov 2023 +£39.6m over
Slide 27: Financial Highlights – Year Ended 31 January 2024 (audited)
Financial Highlights – Year Ended 31 January 2024 (audited) Average compound NAV growth of Loan Portfolio Net Loans Granted 9.4% p.a. £28.9m £17.6m since flotation and 12.1% p.a. 31 July 2023: £17.8m Loans granted • £8.8m CBC/Alchemy since 1990* 31 January 2023: £11.5m • £4.9m XPT Excl. £10.1m raise
Slide 28: Post Year End - Financial Highlights
Post Year End - Financial Highlights Follow-on Funding: £9.2m £40.5m cash and treasury balances at 31 January 2024 Equity invested 31 July 2023 : £4.3m • £7.3m Pantheon 31 January 2023 : £12.1m • £1.1m LEBC • £0.8m XPT Current liquidity of £81.2m Following receipt of funds from CBC sale Group is deb
Slide 29: Summary
Summary B.P. Marsh’s expertise and experience The global insurance puts us in a prime position to support market continues to Our position as capital provider Through an extensive SME financial intermediaries to reach the be a promising of choice for the sector in which we network of brokers, next l
Slide 30: Appendices
Appendices 1 Equity Investment Valuations, IRR note & Loan Portfolio 31 2 Portfolio 34 3 Bridging the Gap & Investment Model 38 4 Investment Approach & Investment Process 40 5 Financials 42 6 B.P Marsh & Partners Plc and B.P. Marsh & Company Limited Board Members 45 7 Minority Investor Protections 4
Slide 31: Equity Investments – Underwriting Agencies
Equity Investments – Underwriting Agencies Fair market value Equity Movement in Period Movement in Period 31 January 2024 As at 31 January Cost of equity Year of initial to 31 January 2024 to 31 January 2024 Investment Sector Jurisdiction (£’000) 2024 investment (£’000) investment (£’000) (%) ATC MG
Slide 32: Equity Investments - Brokers and IFA
Equity Investments - Brokers and IFA Fair market value Equity Movement in Period Movement in Period 31 January 2024 As at 31 January Cost of equity Year of initial to 31 January 2024 to 31 January 2024 Investment Sector Jurisdiction (£’000) 2024 investment (£’000) investment (£’000) (%) Paladin (CBC
Slide 33: Loan Portfolio
Loan Portfolio Investment 31 January 2024 (£'000) 31 July 2023 (£'000) 31 January 2023 (£'000) Ag Guard 621 653 682 Ai Marine 500 - - Alchemy 6,000 - - Brown & Brown 524 - - Denison and Partners 670 670 500 Fiducia 1,481 1,771 2,225 LEBC 3,300 3,000 3,000 LPR - - 300 Paladin (CBC) 5,901 5,096 3,096
Slide 34: Portfolio as at 31 January 2024
Portfolio as at 31 January 2024 Ai Marine Risk Limited • Investment date: December 2023 (through Dempsey Group Limited) Shareholding: 30.0% • Ai Marine is a Marine Hull Insurance MGA focussing on the UK & Europe, Middle-East and Asia-Pacific regions Agri Services Company PTY Limited • Investment dat
Slide 35: Portfolio as at 31 January 2024 Continued
Portfolio as at 31 January 2024 Continued CBC UK Limited • Investment date: February 2017 (through Paladin Holdings Limited) Shareholding: 43.8% • CBC is a Retail and Wholesale Lloyd’s Insurance Broker, offering a wide range of services to commercial and personal clients as well as broking solutions
Slide 36: Portfolio as at 31 January 2024 Continued
Portfolio as at 31 January 2024 Continued LEBC Holdings Limited • Investment date: April 2007 Shareholding: 59.3% • LEBC is a holding company that, until April 2024, owned two businesses that were national Independent Financial Advisory companies providing services to individuals, corporates and par
Slide 37: Portfolio as at 31 January 2024 Continued
Portfolio as at 31 January 2024 Continued Stewart Specialty Risk Underwriting Ltd • Investment date: January 2017 Shareholding: 30.0% • SSRU is a recently established Specialty Casualty Underwriting Agency, based in Toronto, Canada. It provides specialist insurance products to a wide array of client
Slide 38: Bridging the Gap
Bridging the Gap B.P. Marsh specialises in providing early- With the support of B.P. Marsh, these stage finance, investing in businesses with businesses develop over time achieving an enterprise value of between £0 and c. considerable growth in value £25m These investments then attract the int
Slide 39: Investment Model
Investment Model Up To £5m Specialist Investor Relationship Driven Initial Investment B.P. Marsh specialises in early stage We see people as key to each investment and We take on investments which are smaller than and SME financial services businesses we build relationships as well as businesses oth
Slide 40: Investment Approach
Investment Approach Flexibility Long-Term View Value Add We’re proud to have a uniquely flexible We bring specialist experience and We have a long-term approach to our approach to investment and exit sector-specific expertise and knowledge investment partnerships WE ARE FLEXIBLE WE BRING MORE THAN J
Slide 41: Investment Process
Investment Process 1 2 3 4 Initial Assessment Due Diligence and Completion Post Transaction Support Exit Strategy • Strong network of industry contacts • Consider exit strategy when the business • Work to flexible timelines • Business plan implemented brings new opportunities is ready to move to the
Slide 42: Consolidated Statement of Financial Position (IFRS)
Consolidated Statement of Financial Position (IFRS) at 31 January 2024 31 January 2024 31 July 2023 31 January 2023 (Audited) (Unaudited) (Audited) Tangible and intangible assets 65 72 79 Right of use asset 507 590 671 Investments at fair value – Equity Portfolio 165,382 185,815 171,461 Debtors / Lo
Slide 43: Consolidated Statement of Comprehensive Income (IFRS)
Consolidated Statement of Comprehensive Income (IFRS) at 31 January 2024 Audited year to Unaudited 6 months to Audited year to 31 January 2024 £'000 31 July 2023 £'000 31 January 2023 £'000 Gains on investments (realised and unrealised) 43,674 14,714 27,430 Amounts recovered from / (impairment of) i
Slide 44: Consolidated Statement of Cash Flows (IFRS)
Consolidated Statement of Cash Flows (IFRS) at 31 January 2024 Audited year to Unaudited 6 months to Audited year to 31 January 2024 £'000 31 July 2023 £'000 31 January 2023 £'000 Net cash (used by)/from operating activities (1,075) 213 451 FX Movement (52) (49) (36) Taxation (33) (33) (14) Purchase
Slide 45: B.P. Marsh & Partners PLC Board
B.P. Marsh & Partners PLC Board Brian Marsh Dan Topping Pankaj Lakhani Executive Chairman Chief Investment Officer Non-Executive Director 55+ years of experience 17+ years of experience 40+ years of experience Founded B.P. Marsh in 1989 Joined B.P. Marsh in 2007 and appointed Chief Investment Of
Slide 46: B.P. Marsh & Company Limited Board
B.P. Marsh & Company Limited Board Brian Marsh Dan Topping Jon Newman Executive Chairman Chief Investment Officer Group Finance Director 55+ years of experience 17+ years of experience 25+ years of experience Founded B.P. Marsh in 1989 Joined B.P. Marsh in 2007 and appointed Chief Investment Off
Slide 47: Minority Investor Protections
Minority Investor Protections B.P. Marsh believes that day-to-day operational control of The Group has an extensive track record of working within the business is the domain of the executive management companies as partners and places significant emphasis team. However, our position is well prot
Slide 48: Environmental, Social and Governance Policy
Environmental, Social and Governance Policy B.P. Marsh is committed to being a responsible investor with Environmental, Social The results revealed that many of our portfolio companies shared our view of the and Governance (ESG) focused principles incorporated throughout our investment importanc
Slide 49: Key Shareholders as at May 2024
Key Shareholders as at 24 May 2024 Directors Major Shareholders (>3%) Brian Marsh OBE 38.1% PSC UK Pty Limited 19.84% Alice Foulk Less than 0.5%* Mr. Martin MacLeish 5.02% Daniel Topping Less than 0.5%* Hargreaves Lansdown Asset Mgt 4.44% Jonathan Newman Less than 0.5%* Interactive Investor 3.88% Pa
Slide 50: Share Option Plan (SOP) and Joint Share Ownership Plan (JSOP)
Share Option Plan (SOP) and Joint Share Ownership Plan (JSOP) On 6 September 2023 the Board adopted a The SOP is expected to become 1.1% In October 2023 the 1,206,888 allocated new nil-cost Share Option Plan for selected dilutive from 643p/share NAV, and Trust shares were granted voting and employee
Slide 51: Contacts
4 Matthew Parker Street London SW1H 9NP Telephone: 020 7233 3112 http://www.bpmarsh.co.uk/ Nominated Adviser & Broker Panmure Gordon Telephone: 020 7886 2500 Financial PR Tavistock Telephone: 020 7920 3150 © 2024 B.P. MARSH & PARTNERS PLC 51