Vinci Compass Investments Ltd. · NASDAQ:VINP
Vinci Compass Investments — Vinci Partners Investments — Investor Presentation (December 2021)
58 slides from Vinci Compass Investments's investor presentation, Dec 1, 2021
Slide 1: Investor Presentation November 2021
Investor Presentation November 2021 Exhibit 99.1
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: Business Overview
Business Overview
Slide 4: Leading full-service alternative asset manager in Brazil
We are a leading, full - service alternative asset manager in Brazil We have a high visibility and integrated recurring revenues business model 77% Of you net revenues come from mgmt. Fees 4 Our business is profitable and growing , with strong operating leverage FRE Margin 53.5% 3Q’21 +310 bps YoY A
Slide 5: We have scaled our platform significantly since 2009
2 6 11 15 17 18 20 19 21 24 35 48 54 50 58 39 61 76 88 76 95 142 121 145 137 196 221 224 - 50 100 150 200 250 0 10 20 30 40 50 60 70 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 3Q'21 AUM (R$bn) AUM DC¹ (R$bn) Brazil Interest Rates AUM/FTE Vinci Partners was founded in October 2009 by
Slide 6: Alternative investment products across multiple verticals
Proven ability to invest proprietary and third - party capital through different products yielding sustainable profitability acros s multiple verticals We offer a complete portfolio of alternative investment products and solutions to both retail and institutional clients Investor Relations, Support,
Slide 7: Platform built on four key pillars
Our platform is built on four key pillars: people, diversification, performance and distribution Strong “Partnership Culture” reinforcing our mission, vision, and values with partners having worked together for over 20 years People Well - established robust “One - stop Shop” AAM platform diversified
Slide 8: First-class management team
First - class management team with proven execution capabilities and long - term alignment of interests Our long - standing partnership model drives our success Strong Fundraising Capabilities Unique Expertise in Capital Allocation Solid Execution Translating into Returns + + 28 years experience 28
Slide 9: Diversified AUM and revenue profile
24% 10% 4% 6% 23% 16% 6% 12% Private Equity Real Estate Credit Infrastructure IP&S Public Equities Hedge Funds Advisory 19% 9% 5% 4% 41% 17% 5% AUM 3Q ' 21 Our AUM base favors alpha - driven strategies, while our revenue profile is management fee - centric … and is highly diversified across differen
Slide 10: AUM funding base built on proprietary distribution channels
Allocators & Distributors 36% 25% 21% 14% 4% HNWI Institutional Offshore 45% 39% 16% Our AUM funding base is mostly built upon our proprietary distribution channels Private Markets 3Q'21 AUM Liquid Strategies 3Q'21 AUM IP&S 3Q'21 AUM Private Markets’ AUM base favors long - term to perpetual capital
Slide 11: Our ESG approach permeates our investment strategies
Our ESG approach is a fundamental value that permeates throughout our investment strategies We are pioneers among Brazilian firms in our commitment to ESG Vinci Energia Sustentavel (VES) - Credit Fund focused on private debt related to green energy funded by BNDES VIR IV - launched with dual mandate
Slide 12: Risk management and compliance
Risk management committee composed and supervised by senior executives including the addition of Julya Wellish as a partner and head of Legal & Compliance (Previously Chief Prosecutor at CVM 1 ) We place a strong emphasis on risk management, taking the utmost care of our clients ’ capital ▪ Mandator
Slide 13: Leader in Brazilian alternative asset management
We are a leader in Brazilian alternative asset management with strong competitive advantages AUM CAGR 2018 – September ‘21 ~35% 43% of Net Revenues come from Private Market Strategies ~50% of AUM committed for over 5 years Diversified business model 8 business units Partnership model: 34 partners Vi
Slide 14: Financial Highlights
Financial Highlights
Slide 15: Third Quarter and Year-to-Date 2021 Highlights
Third Quarter and Year - to - Date 2021 Highlights R$58bn AUM 3Q'21 +19% YoY R$2.9bn Private Markets Fundraising YTD 2021 R$6.2bn IP&S Net inflows YTD 2021 R$63.1mm FRE 3Q ' 21 +74% YoY 53.5% FRE Margin 3Q ' 21 +310 bps YoY R$61.7mm DE 3Q ' 21 +137% YoY 46.6% DE Margin 3Q ' 21 +1,200 bps YoY US$0.46
Slide 16: AUM growth and net inflows in the quarter
▪ Net Inflows of R$2.0 billion in the quarter , with highlights to our IP&S and Credit strategies. ▪ R$1.9 billion raised in IP&S, coming primarily from new exclusive mandates. ▪ R$223 million raised in Private Credit funds. ▪ Net Inflows accounted for R$5.7 billion in the year - to - date , with hi
Slide 17: Resilient business model with high management fee centricity
195 269 17 34 23 47 235 350 3Q'20 YTD 3Q'21 YTD 72 93 2 6 25 74 124 3Q'20 3Q'21 We have a resilient business model with high management fee centricity and embedded operating leverage… 147 224 271 6 62 40 20 11 29 173 297 340 2018 2019 2020 Management Performance Advisory Vinci’s revenue is primarily
Slide 18: Performance fee eligible AUM
Vinci holds a strong position for future realization of performance fees with over R$7 billion in PEAUM coming from preferred return funds with carried interest With significant exposure to performance fee - eligible AUM... PERFORMANCE FEE ELIGIBLE AUM (PEAUM) Strategy/Fund AUM R$mm Index type Index
Slide 19: Financial income and realized GP investment
▪ Realized GP Investment¹ and Financial income² of R$1.7 million in the 3Q ' 21, up 3,443% year - over - year, driven by realized gains from our liquid funds’ portfolio. ▪ Our liquid funds' portfolio underperformed the CDI quarterly return by 1.1 percentage point, due to the significant market vo la
Slide 20: Highly visible growth and profitability profile
114 169 3Q'20 YTD 3Q'21 YTD 87 164 3Q'20 YTD 3Q'21 YTD 26 62 3Q'20 3Q'21 36 63 3Q'20 3Q'21 Which translates to a highly visible growth and profitability profile 54 98 151 2018 2019 2020 Fee - Related Earnings (FRE) – R$mm After - tax Distributable Earnings (DE) – R$mm 42% FRE Margin 50% 34% 38% DE M
Slide 21: Valuation Framework – SOTP
Valuation Framework – SOTP (Sum - of - the - parts) Vinci brand recognition The standard valuation framework for asset management firms is SOTP Fee - Related Earnings (“FRE”) Cash and Net Investments Performance - Related Earnings (“PRE”) Apply a Target Multiple to Earnings on FRE that represents th
Slide 22: VINP Sum-of-the-Parts Valuation
VINP Sum - of - the - Parts Valuation Market data as of November 17, 2021. See notes and definitions at end of document Current Valuation 3Q’21 @ November 17, 2021 Cash and Net Investments (R$ mm) 1,467.2 Cash and Net Investments/share (US$) 4.69 Consensus NPV Performance fees¹ (R$ mm) 359.4 Perform
Slide 23: VINP vs. Peer alternative asset managers
VINP 10x 20x 30x 40x 20% 50% 80% P/DE¹ (2022E) DE CAGR (20 - 22E) VINP 0x 15x 30x 45x 10% 20% 30% 40% Implied P/FRE³ 22E FRE CAGR (20 - 22E) VINP vs. Peer alternative asset managers Market data as of November 17, 2021. Source: Goldman Sachs Research See notes and definitions at end of document Highe
Slide 24: Key Takeaways
Key Takeaways 83% FRE as % DE 3 Q ' 21 YTD We operate a highly predictable business model with recurring revenues coming primarily from management fees 1 We see a relevant upside coming from potential future realization of performance fees R$7 billion in PEAUM from Private Market funds still in inve
Slide 25: Appendix – I Segment summaries
Appendix – I Segment summaries
Slide 26: Financials by segment
▪ Fee Related Earnings (FRE) were R$168.5 million in the 3Q'21 YTD, with 47% of FRE coming from Private Markets, followed by Li qui d Strategies accounting for 21%, IP&S for 17% and Financial Advisory for 15%. ▪ Segment Distributable Earnings were R$190.1 million in the 3Q'21 YTD, with 43% coming fr
Slide 27: Private Markets platform
We offer a complete and diversified platform for alternative investments The private equity strategy invests through two sub - strategies : Vinci Capital Partners : VCP focuses on control and co - control investments, executing across growth equity transactions, greenfield investments, buyouts and t
Slide 28: Private Markets segment financials
(R$ thousands, unless mentioned) 3Q'20 3Q'21 ∆ (%) 3Q'20 YTD 3Q'21 YTD ∆ (%) Net revenue from management fees 43,339 49,057 13% 117,552 145,045 23% Net revenue from advisory fees 92 823 798% 909 3,969 337% Total Fee Related Revenues 43,431 49,880 15% 118,460 149,014 26% Segment personnel expenses (1
Slide 29: Liquid Strategies platform
We have an established and widely recognized liquid strategies platform LIQUID STRATEGIES R$13 BILLION AUM Vinci Partners has a long track record and deep experience investing in public equities in Brazil . We focus on holding positions in companies for three to five years following deep analysis an
Slide 30: Liquid Strategies segment financials
Public Equities 76% Hedge Funds 24% Liquid Strategies' AUM (R$ thousands, unless mentioned) 3Q'20 3Q'21 ∆ (%) 3Q’20 YTD 3Q’21 YTD ∆ (%) Net revenue from management fees 15,766 23,273 48% 46,072 66,276 44% Net revenue from advisory fees - - N/A - - N/A Total Fee Related Revenues 15,766 23,273 48% 46,
Slide 31: Investment Products & Solutions
We are market leaders in providing investment solutions to our clients In our separate exclusive mandates, we provide investment solutions to institutional investors, such as small to medium - sized foundations, pension funds and financial institutions in Brazil, and high net worth individuals . Our
Slide 32: IP&S segment financials
Separate Mandates 64% Commingled Funds 14% International 13% Pension Plans 9% IP&S' AUM (R$ thousands, unless mentioned) 3Q'20 3Q'21 ∆ (%) 3Q’20 YTD 3Q’21 YTD ∆ (%) Net revenue from management fees 12,422 20,525 65% 31,627 58,154 84% Net revenue from advisory fees 25 8 - 68% 96 47 - 51% Total Fee Re
Slide 33: Leading financial advisory business
We have a leading financial advisory business About our Financial Advisory team Our financial advisory services team provides financial and strategic services to business owners, senior corporate management teams and boards of directors, focusing mostly on pre - IPO and M&A advisory services for Bra
Slide 34: Financial Advisory
Financial Advisory ▪ Fee related earnings (FRE) of R$15.2 million in the quarter, up R$16.5 million year - over - year. FRE was R$25.0 million in the 3Q ' 21 YTD, an increase of 95% when compared to the 3Q'20 YTD, a consequence of the stronger deal activity in 2021. ▪ Segment Distributable Earnings
Slide 35: Appendix – II Financial statements
Appendix – II Financial statements
Slide 36: How to analyze Vinci Partners' financial model
How to analyze Vinci Partners’ financial model Fee Related Earnings (FRE) (+) Management fees: our main source of revenues, derived from fees charged over our Fee - Earning AUM (+) Advisory fees: fees charged over advisory services provided by our financial advisory and management teams ( - ) Operat
Slide 37: Fee Related Earnings quarterly statement
Quarterly Year - to - date (R$ thousands, unless mentioned) 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 YTD 3Q'20 YTD 3Q'21 Net revenue from management fees 62,898 60,826 71,517 76,025 81,843 94,778 92,855 195,241 269,476 Net revenue from advisory fees 15,972 6,479 330 6,061 15,066 6,378 25,163 22,781
Slide 38: Income statement
Quarterly Year - to - date (R$ thousands, unless mentioned) 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 YTD 3Q'20 YTD 3Q'21 REVENUES Net revenue from management fees 62,898 60,826 71,517 76,025 81,843 94,778 92,855 195,241 269,476 Net revenue from performance fees (3,976) 19,537 1,697 22,526 9,951 18,
Slide 39: Financials - Non-GAAP Reconciliation
Financials - Non - GAAP Reconciliation See notes and definitions at end of document 39 Quarterly Year - to - date (R$ thousands, unless mentioned) 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 YTD 3Q'20 YTD 3Q'21 OPERATING PROFIT 42,034 45,855 37,494 52,634 56,858 65,999 66,924 125,383 189,781 ( - ) Net
Slide 40: Effective tax rate reconciliation
Effective tax rate reconciliation (R$ thousands, unless mentioned) 3Q'20 3Q'21 Profit (loss) before income taxes, including Dividends to partners 35,389 63,004 (+) Dividends to Partners, related to management, advisory and performance fees 7,301 - Profit (loss) before income taxes, not - including D
Slide 41: General and Administrative Expenses
General and Administrative Expenses 3 Q 2020 (R$mm) 3 Q 2021 (R$mm) 8.8 15.7 0.4 5.7 1.1 2.8 1.6 Lease and condominium Other Personnel Bonus related to Mgmt. and Adv. fees Performance based compensation Third party expenses D&A R$36.1 mm 11.1 26.0 1.8 6.6 0.9 3.3 2.2 2.9 1.9 Personnel Bonus related
Slide 42: Balance Sheet Results
Balance Sheet Results Assets 12/31/2020 9/30/2021 Current assets Cash and cash equivalents 83,449 105,499 Cash and bank deposits 13,096 26,218 Financial instruments at fair value through profit or loss 70,353 79,281 Financial instruments at fair value through profit or loss 8,253 1,361,674 Trade rec
Slide 43: Supplement Details
Supplement Details
Slide 44: AUM and Fee-Earning AUM Rollforward
AUM and Fee - Earning AUM Rollforward Assets Under Management (AUM) – R$ millions Fee - Earning Assets Under Management (FEAUM) – R$ millions Private Public IP&S Infrastructure Real Estate Credit Hedge Total Equity Equities Funds Beginning balance 10,851 10,861 21,966 2,363 5,087 2,461 3,263 56,852
Slide 45: Investment records – liquid and credit funds
Investment records – IP&S, Liquid Strategies, Credit and Listed Funds Fund Segment NAV¹ (R$ millions) 3Q21 YTD 12 M 24 M Market Comparison Index Rate Vinci Multiestratégia FIM Hedge Funds 928.7 0.8% 1.2% 1.9% 6.2% CDI 4 CDI 4 Atlas Strategy² Hedge Funds 635.7 - 3.7% - 4.0% - 3.1% 7.5% CDI 4 CDI 4 Vi
Slide 46: Pro Forma Historical Portfolio Performance
Pro Forma Historical Portfolio Performance - Excluding PIPE Investments¹ Investment records – Closed End Private Markets funds Fund Segment Vintage year Committed Capital Invested Capital Realized or Unrealized Total Value Gross MOIC Gross MOIC Gross IRR Gross IRR Partially Realized (R$mm) (R$mm) (R
Slide 47: Shareholder Dividends
Shareholder Dividends ▪ Vinci Partners’ generated R$1.09 or US$0.20¹ of Distributable Earnings per common share for the third quarter of 2021. ▪ The company declared a quarterly dividend of US$0.16² per common share to record holders as of December 01, 2021; payable on Dec ember 16 , 2021 . ($ in th
Slide 48: Share Summary
Share Summary VINP Shares 4Q ' 20 (Pre IPO) 1Q ' 21 2Q ' 21 3Q ' 21 Class B 14,466,239 14,466,239 14,466,239 14,466,239 Class A – Partnership Units 27,175,861 27,175,861 27,175,861 27,175,861 Class A - Public Float N/A 15,271,488 15,094,833 14,921,318 Common Shares 41,642,100 56,913,588 56,736,933 5
Slide 49: GP Commitment in Private Market funds
GP Commitment in Private Market funds (R$ millions, unless mentioned) Segment 3Q ' 21 Total Capital 3Q ’ 21 Total Capital Capital Returned/ Accumulated Capital Fair value Fund Commitments Committed Capital Called Called Dividends Payed Returned/ of investments (3Q ' 21) Dividends Payed Nordeste III
Slide 50: Notes and Definitions
▪ Notes to page 4 (1) AUM is calculated as consolidated with double counting, due to funds from one segment investing in other segments and it ´ s eliminated on consolidation and excluding VIFI from Credit and Pension Products Co - managed with IP&S from Equities. (2) CAGR is calculated considering
Slide 51: Notes and Definitions (cont'd)
Notes and Definitions (cont’d) ▪ Notes to page 15 (1) Annualized dividend yield is calculated considering the company ´ s stock price on November 17, 2021, of US$ 12 .40, and the annualized year - to - date dividend of US$0.46/share. ▪ Notes to page 17 (1) Public company new recurring costs include
Slide 52: Notes and Definitions (cont'd)
Notes and Definitions (cont’d) (3) IMAB is composed by government bonds indexed to IPCA (inflation rate) plus a fixed interest rate. (4) Back test result between January 2016 and March 2021. The result from the 2Q’21 onwards is the effective return of the ca sh allocation ▪ Notes to page 22 (1) Repr
Slide 53: Notes and Definitions (cont'd)
Notes and Definitions (cont’d) ▪ Notes to page 38 (1) Bonus compensation related to management and advisory includes Dividends to Partners related to management and advisory, dis tributed by the company to its original partners before the company turned public in 2021. (2) Performance based compensa
Slide 54: Notes and Definitions (cont'd)
Notes and Definitions (cont’d) (7) IMAB is composed by government bonds indexed to IPCA (inflation rate) plus a fixed interest rate. IMAB 5 also includes go ver nment bonds indexed to IPCA with up to 5 Years in duration. (8) IFIX is an index composed by listed REITs in the brazilian stock Market. ▪
Slide 55: Notes and Definitions (cont'd)
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 or investment income. We calculate FRE as operating profit less (a) net revenue from realized perfo
Slide 56: Notes and Definitions (cont'd)
Notes and Definitions (cont’d) ▪ Net Cash and Investments include cash and cash equivalents and the fair value of investments in liquid funds and GP Fund Inve stm ents. Cash and cash equivalents include cash, certificate of deposits, which are issued by Banco Bradesco (credit rating AAA evaluated by
Slide 57: Notes and Definitions (cont'd)
Notes and Definitions (cont’d) ▪ “Capital Subscription / (capital return)” represents the net capital commitments and capital returns from our Private Markets ’ c losed end and listed funds. ▪ “Net Inflows / (outflows)” represent the net inflows and outflows from our liquid funds from our liquid str
Slide 58: Notes and Definitions (cont'd)
Notes and Definitions (cont’d) ▪ 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 strategies
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