Slide 1: TPG Reports Fourth Quarter and Full Year 2021 Financial Results
TPG Reports Fourth Quarter and Full Year 2021 Financial Results Year Ended December 31, 2021
Slide 2: TPG Reports Fourth Quarter 2021 Financial Results
TPG Reports Fourth Quarter 2021 Financial Results San Francisco and Fort Worth, TX –March 28, 2022 – TPG Inc. (NASDAQ: TPG), a leading global alternative asset management firm, reported its unaudited fourth quarter and full year 2021 results. TPG issued a full detailed presentation of its fourth qua
Slide 3: About TPG
TPG Reports Fourth Quarter 2021 Financial Results About TPG TPG is a leading global alternative asset management firm founded in San Francisco in 1992 with $114 billion of assets under management and investment and operational teams in 12 offices globally. TPG invests across five multi-product platf
Slide 4: Forward Looking Statements
Forward Looking Statements This presentation contains “forward-looking” statements based on the Company’s beliefs and assumptions and on information currently available to the Company. Forward-looking statements can be identified by words such as “anticipates,” “intends,” “plans,” “seeks,” “believes
Slide 5: Comparability Statement and Pro Forma Financial Information
Comparability Statement and Pro Forma Financial Information Prior to and in connection with our initial public offering (“IPO”), we completed certain transactions as part of a corporate reorganization (the “Reorganization”), which concluded with NASDAQ listing our Class A common stock on January 13,
Slide 6: Fourth Quarter and Full Year 2021 Financial Results
Fourth Quarter and Full Year 2021 Financial Results
Slide 7: GAAP Statements of Operations
GAAP Statements of Operations Net income was $4.7 billion and $834 million for the year ended and quarter ended December 31, 2021, respectively, an increase of 224% over FY’20 and decrease of 27% from 4Q’20, respectively Net income attributable to controlling interests was $2.0 billion and $326 mill
Slide 8: Pro Forma GAAP Statements of Operations
Pro Forma GAAP Statements of Operations Pro forma net income attributable to TPG Inc. was $231 million for the year ended December 31, 2021, an increase of 175% over FY’20 Pro forma net income attributable to TPG Inc. was $41 million for the quarter ended December 31, 2021, a decrease of 8% compared
Slide 9: Fourth Quarter and Full Year 2021 Highlights
Fourth Quarter and Full Year 2021 Highlights FY’21 FRE of $179 million increased 76% versus FY’20, and After-Tax DE of $1.24 billion nearly tripled year-over-year Non-GAAP Actual 4Q’20 4Q’21 FY’20 FY’21 Financial Fee-Related Revenues (“FRR”) $199 $239 $716 $867 Measures Fee-Related Earnings (“FRE”)
Slide 10: Non-GAAP Financial Measures
Non-GAAP Financial Measures Fee-Related Earnings decreased 7% from $53 million in 4Q’20 to $49 million in 4Q’21, and increased 76% from $101 million in FY’20 to $179 million in FY’21 Realized performance allocations, net grew on both a quarter and full-year basis, increasing by 27% in 4Q’21 over 4Q’
Slide 11: Pro Forma Non-GAAP Financial Measures
Pro Forma Non-GAAP Financial Measures Pro Forma Fee-Related Earnings increased 19% from $76 million in 4Q’20 to $91 million in 4Q’21, and increased 44% from $227 million in FY’20 to $326 million in FY’21 Pro forma realized performance allocations, net increased by 32% in 4Q’21 over 4Q’20 and 401% in
Slide 12: Fee-Related Earnings
Fee-Related Earnings Fee-Related Revenues increased 21% in FY’21 over FY’20, driven mainly by growth in Fee Earning AUM for the Growth, Impact, and Market Solutions platforms resulting in management fees growing 15% in FY’21 over FY’20 Fee-Related Expenses increased between FY’20 and FY’21 on both a
Slide 13: After-Tax Distributable Earnings
After-Tax Distributable Earnings After-Tax Distributable Earnings were $1.24 billion for FY’21 compared to $441 million for FY’20, an increase of 181% driven primarily by realized performance allocations, net from the Capital and Growth platforms, with additional growth in Fee-Related Earnings On a
Slide 14: Realized Performance Allocations, Net
Realized Performance Allocations, Net Realized performance allocations, net grew 27% in 4Q’21 over 4Q’20 and 219% in FY’21 over FY’20 In FY’21, realized performance allocations, net were largely driven by TPG VI and TPG VII in the Capital platform and Growth III in the Growth platform Pro forma real
Slide 15: Pro Forma Net Accrued Performance Allocations
Pro Forma Net Accrued Performance Allocations Pro Forma Net Accrued Performance 4Q’21 Pro Forma Net Accrued Performance Allocations Allocations by Vintage ($M) 3Q’21 4Q’21 ($M) 6% 2016 & Prior $260 $233 4% 2017 219 268 10% 2018 53 62 2019 123 140 Total $769 2020 22 43 19% 61% 2021 0 23 Total $677 $7
Slide 16: GAAP Balance Sheet (Unaudited)
GAAP Balance Sheet (Unaudited) In 4Q’21 we effectuated certain aspects of the Reorganization with respect to assets transferred to RemainCo, including cash and economic entitlements associated with certain other investments, which is reflected in our GAAP actuals; the pro forma column includes the i
Slide 17: Non-GAAP Balance Sheet
Non-GAAP Balance Sheet In 4Q’21 we effectuated certain aspects of the Reorganization with respect to assets transferred to RemainCo, including cash and economic entitlements associated with certain other investments, which is reflected in our Non-GAAP actuals; the pro forma column includes the impac
Slide 18: Operating Metrics
Operating Metrics
Slide 19: Assets Under Management and Fee Earning AUM
Assets Under Management and Fee Earning AUM 4Q’21 AUM rose 27% over 4Q’20, driven by value creation of 38% for FY’21 and fundraising of $20.5 billion over the same period, which included $6.7 billion in Rise Climate within the Impact platform; this was offset by realizations totaling $25.4 billion f
Slide 20: AUM and Fee Earning AUM Duration
Assets Under Management and Fee Earning AUM Duration Approximately 87% of our AUM and 85% of our FAUM is in perpetual or long-dated funds with a duration(1) of 10 or more years (prior to any extensions) Approximately 75% of our FAUM has a remaining lifespan(2) of 5 or more years, with almost 25% in
Slide 21: AUM Subject to Fee Earning Growth
AUM Subject to Fee Earning Growth AUM Subject to Fee Earning Growth totaled $9.4 billion at 4Q’21, and represents capital commitments that can grow fees when deployed through earning new management fees (AUM Not Yet Earning Fees) or when invested from a higher rate of management fees (FAUM Subject t
Slide 22: AUM Rollforward
AUM Rollforward AUM increased $4.5 billion in 4Q’21 and $24.1 billion in FY’21 – an increase of 4% and 27%, respectively AUM growth was driven by capital raised of $2.8 billion for 4Q’21 and $20.5 billion for FY’21, including $7.2 billion in the Impact platform and $4.9 billion in the Growth platfor
Slide 23: FAUM Rollforward
FAUM Rollforward FAUM increased $0.7 billion in 4Q’21 and $9.4 billion in FY’21, an increase of 1% and 19%, respectively Increases over both periods were largely driven by fee earning capital raised, particularly in the Impact platform, with contribution from the Growth platform on a full-year basis
Slide 24: Other Operating Metrics
Other Operating Metrics Across the investment platform, our various operating metrics saw large increases in 2021, both on a quarter and full-year basis (All tables in $M) Capital Raised 4Q’20 4Q’21 FY’20 FY’21 Capital $851 $551 $1,546 $4,174 Growth 169 313 1,882 4,893 Impact 44 918 423 7,172 Real E
Slide 25: Supplemental Details
Supplemental Details
Slide 26: GAAP and Non-GAAP Performance Allocations
GAAP and Non-GAAP Performance Allocations Year ended December 31, 2021 GAAP GAAP GAAP ($ in thousands) Realized Unrealized Total Platforms Capital $ 1,398,761 $ 1,139,309 $ 2,538,070 Growth 450,608 338,773 789,381 Impact 2,103 223,819 225,922 Real Estate 74,882 115,822 190,704 Market Solutions 29,80
Slide 27: GAAP and Non-GAAP Realized Performance Allocations
GAAP and Non-GAAP Realized Performance Allocations Year ended December 31, 2021 Pro Forma Non-GAAP Non-GAAP Pro Forma ($ in thousands) GAAP Adjustments Non-GAAP Adjustments Non-GAAP Capital TPG VII $ 953,370 $ (451,786) $ 501,584 $ (310,910) $ 190,674 TPG VI 345,144 (171,655) 173,489 (173,489) -Asia
Slide 28: Pro Forma GAAP Earnings Per Share
Pro Forma GAAP Earnings Per Share Pro forma basic earnings per share of $2.91 for FY’21 and $0.52 for 4Q’21 Pro forma diluted earnings per share of $1.80 for FY’21 and $0.25 for 4Q’21 ($ in thousands, except share and per share amounts) 4Q’20 4Q’21 FY’20 FY’21 Pro Forma Net Income Per Share Numerato
Slide 29: Pro Forma After-Tax DE and Dividends Per Share
Pro Forma After-Tax DE and Dividends Per Share Fully diluted dividend per share of $1.17 for FY’21, compared to $0.51 for FY’20 Fully diluted dividend per share reflects the conversion of operating group units into Class A Common Stock and full vesting of all unvested RSU grants ($ in thousands, exc
Slide 30: Fund Performance Metrics
Fund Performance Metrics Investor ($ in millions, as of 12/31/21) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Platform: Capital Capital Funds Air Partners 1993 $ 64 $ 64 $ 697 $ —$
Slide 31: Fund Performance Metrics (Cont'd)
Fund Performance Metrics (Cont’d) Investor ($ in millions, as of 12/31/21) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Platform: Growth Growth Funds STAR 2007 $ 1,264 $ 1,259 $ 1,85
Slide 32: Fund Performance Metrics (Cont'd)
Fund Performance Metrics (Cont’d) Investor ($ in millions, as of 12/31/21) Vintage Capital Capital Realized Unrealized Total Gross Gross Net Net Fund Year(1) Committed(2) Invested(3) Value(4) Value(5) Value(6) IRR(7) MoM(7) IRR(8) MoM(9) Platform: Real Estate TPG Real Estate Partners DASA RE 2012 $
Slide 33: Fund Performance Metrics Notes
Fund Performance Metrics Notes Vintage Year, with respect to an investment or group of investments, as applicable, represents the year such investment, or the first investment in such a group, was initially consummated by the fund. For follow-on investments, Vintage Year represents the year that the
Slide 34: Fund Performance Metrics Notes (Cont'd)
Fund Performance Metrics Notes (Cont’d) Net IRR represents the compound annualized return rate (i.e., the implied discount rate) of a fund, which is calculated using investor cash flows in the fund, including cash received from capital called from investors, cash distributed to investors and the inv
Slide 35: Fund Performance Metrics Notes (Cont'd)
Fund Performance Metrics Notes (Cont’d) (continued) As of December 31, 2021, TPEP Long Only had estimated inception-to-date gross returns of 34% and net returns of 34%. These performance estimates represent performance for TPEP Long Only and are based on an investment in TPEP Long Only made on May 1
Slide 36: Reconciliations and Disclosures
Reconciliations and Disclosures
Slide 37: GAAP to Non-GAAP Financial Measures Reconciliation
GAAP to Non-GAAP Financial Measures Reconciliation ($ in thousands) 4Q’20 4Q’21 FY’20 FY’21 GAAP Revenue $1,550,433 $1,079,327 $2,114,838 $4,976,387 Capital-allocation Income (1,326,148) (786,538) (1,231,472) (3,998,483) Deconsolidation of former affiliate — (87,235) -Expense Reimbursements (34,240)
Slide 38: GAAP to Non-GAAP Balance Sheet Reconciliation
GAAP to Non-GAAP Balance Sheet Reconciliation ($ in thousands) 3Q’21 4Q’21 Total GAAP Assets $ 10,770,033 $8,962,013 Impact of consolidated TPG Funds and Public SPACs Cash and cash equivalents (4,211) (5,371) Assets held in Trust Accounts (1,285,021) (1,000,027) Investments (250,162) -Due from affil
Slide 39: 4Q'20 Pro Forma GAAP Statements of Operations
4Q’20 Pro Forma GAAP Statements of Operations Reorganization and Other Offering Transaction Transaction ($ in thousands) GAAP 4Q’20 Adjustments Adjustments Pro Forma 4Q’20 Revenues Fees and other $224,285 $ 4,294 $- $228,579 (3) Capital allocation-based income 1,326,148 (17,806)—1,308,342 (1) Total
Slide 40: 4Q'21 Pro Forma GAAP Statements of Operations
4Q’21 Pro Forma GAAP Statements of Operations Reorganization and Other Offering Transaction Transaction ($ in thousands) GAAP 4Q’21 Adjustments Adjustments Pro Forma 4Q’21 Revenues Fees and other $292,789 $ 3,950 $- $296,739 (3) Capital allocation-based income 786,538 (7,447)—779,091 (1) Total reven
Slide 41: Quarterly Pro Forma GAAP Statements of Operations Footnotes
Quarterly Pro Forma GAAP Statements of Operations Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Operations and Other Data This adjustment relates to Excluded Assets and is made up of the following components: Impact of changes in economics of certain TPG general part
Slide 42: Quarterly Pro Forma GAAP Statements of Operations Footnotes
Quarterly Pro Forma GAAP Statements of Operations Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Operations and Other Data continued This amount reflects an administrative services fee that we will receive for managing the Excluded Assets to be transferred to RemainCo
Slide 43: Quarterly Pro Forma GAAP Statements of Operations Footnotes
Quarterly Pro Forma GAAP Statements of Operations Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Operations and Other Data continued In connection with the IPO, we granted to certain of our people RSUs with respect to approximately 9,280,000 shares of Class A common s
Slide 44: FY'20 Pro Forma GAAP Statements of Operations
FY’20 Pro Forma GAAP Statements of Operations Reorganization and Other Offering Transaction Transaction ($ in thousands) GAAP FY’20 Adjustments Adjustments Pro Forma FY’20 Revenues Fees and other $883,366 $(67,998) $- $815,368 (1), (3) Capital allocation-based income 1,231,472 159,840—1,391,312 (1)
Slide 45: FY'21 Pro Forma GAAP Statements of Operations
FY’21 Pro Forma GAAP Statements of Operations Reorganization and Other Offering Transaction Transaction ($ in thousands) GAAP FY’21 Adjustments Adjustments Pro Forma FY’21 Revenues Fees and other $977,904 $ 20,807 $- $998,711 (3) Capital allocation-based income 3,998,483 (8,653)—3,989,830 (1) Total
Slide 46: Annual Pro Forma GAAP Statements of Operations Footnotes
Annual Pro Forma GAAP Statements of Operations Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Operations and Other Data This adjustment relates to Excluded Assets and is made up of the following components: Impact of changes in economics of certain TPG general partner
Slide 47: Annual Pro Forma GAAP Statements of Operations Footnotes
Annual Pro Forma GAAP Statements of Operations Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Operations and Other Data continued This amount reflects an administrative services fee that we will receive for managing the Excluded Assets to be transferred to RemainCo th
Slide 48: Annual Pro Forma GAAP Statements of Operations Footnotes
Annual Pro Forma GAAP Statements of Operations Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Statement of Operations and Other Data continued In connection with the IPO, we granted to certain of our people RSUs with respect to approximately 9,280,000 shares of Class A common stoc
Slide 49: 4Q Pro Forma Non-GAAP Financial Measures
4Q Pro Forma Non-GAAP Financial Measures Reorganization and Offering Other Transaction Transaction Pro Forma Non-($ in thousands) Non-GAAP 4Q’20 Adjustments Adjustments GAAP 4Q’20 Fee-Related Revenues Management Fees $158,816 $- $- $158,816 Transaction, monitoring and other fees, net 29,710 — 29,710
Slide 50: Quarterly Pro Forma Non-GAAP Financial Measures Footnotes
Quarterly Pro Forma Non-GAAP Financial Measures Footnotes Notes to the Unaudited Quarterly Pro Forma Non-GAAP Financial Measures The difference in other income between non-GAAP and pro forma non-GAAP financial measures is attributable to: (i) removing the other income associated with the other inves
Slide 51: FY Pro Forma Non-GAAP Financial Measures
FY Pro Forma Non-GAAP Financial Measures Reorganization and Offering Other Transaction Transaction Pro Forma Non-($ in thousands) Non-GAAP FY’20 Adjustments Adjustments GAAP FY’20 Fee-Related Revenues Management Fees $623,658 $- $- $623,658 Transaction, monitoring and other fees, net 49,455 — 49,455
Slide 52: Annual Pro Forma Non-GAAP Financial Measures Footnotes
Annual Pro Forma Non-GAAP Financial Measures Footnotes Notes to the Unaudited Annual Pro Forma Non-GAAP Financial Measures The difference in other income between non-GAAP and pro forma non-GAAP financial measures is attributable to: (i) removing the other income associated with the other investments
Slide 53: 3Q'21 Pro Forma GAAP Balance Sheet
3Q’21 Pro Forma GAAP Balance Sheet Reorganization and TPG Group Holdings Other Transaction Offering Transaction TPG Inc. Pro Forma ($ in thousands) Historical 3Q’21 Adjustments Adjustments 3Q’21 Assets Cash and cash equivalents $1,783,221 $ (88,700) $431,217 $2,125,738 (1), (5), (8) Restricted cash
Slide 54: Pro Forma GAAP Balance Sheet Footnotes
Pro Forma GAAP Balance Sheet Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated GAAP Balance Sheet Measures as of September 30, 2021 The TPG Operating Group transferred to RemainCo certain performance allocation economic entitlements from certain of the TPG general partner entities th
Slide 55: Pro Forma GAAP Balance Sheet Footnotes
Pro Forma GAAP Balance Sheet Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated GAAP Balance Sheet Measures as of September 30, 2021 continued The adjustment reflects i) proceeds, net of estimated underwriting discounts, of $820.7 million from the IPO based on the issuance of 30,085,6
Slide 56: 4Q'21 Pro Forma GAAP Balance Sheet
4Q’21 Pro Forma GAAP Balance Sheet Reorganization and TPG Group Holdings Other Transaction Offering Transaction TPG Inc. Pro Forma ($ in thousands) Historical 4Q’21 Adjustments Adjustments 4Q’21 Assets Cash and cash equivalents $972,729 $ (27,200) $431,217 $1,376,746 (1), (3), (8) Restricted cash 13
Slide 57: Pro Forma GAAP Balance Sheet Footnotes
Pro Forma GAAP Balance Sheet Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated GAAP Balance Sheet Measures as of December 31, 2021 The TPG Operating Group transferred to RemainCo certain performance allocation economic entitlements from certain of the TPG general partner entities tha
Slide 58: Pro Forma GAAP Balance Sheet Footnotes
Pro Forma GAAP Balance Sheet Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated GAAP Balance Sheet Measures as of December 31, 2021 continued In connection with the IPO, we entered into the Tax Receivable Agreement with certain of our pre-IPO owners that provides for the payment by us
Slide 59: Pro Forma Non-GAAP Balance Sheet
Pro Forma Non-GAAP Balance Sheet Reorganization and Offering Other Transaction Transaction Pro Forma Non- ($ in thousands) Non-GAAP 3Q’21 Adjustments Adjustments GAAP 3Q’21 Book Assets Cash and cash equivalents $335,540 $(88,700) $431,217 $678,057 (1), (2) Restricted Cash 13,135 — 13,135 Accrued per
Slide 60: Pro Forma Non-GAAP Balance Sheet Footnotes
Pro Forma Non-GAAP Balance Sheet Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Non-GAAP Balance Sheet Measures as of September 30, 2021 The difference between non-GAAP and pro forma non-GAAP balance sheet measures relates to the transfer of Excluded Assets, which consist of right
Slide 61: Pro Forma Non-GAAP Balance Sheet Footnotes
Pro Forma Non-GAAP Balance Sheet Footnotes Notes to the Unaudited Pro Forma Condensed Consolidated Non-GAAP Balance Sheet Measures as of December 31, 2021 The difference between non-GAAP and pro forma non-GAAP balance sheet measures relates to the transfer of Excluded Assets, which consist of rights
Slide 62: Notes: Dividend Policy
Notes Dividend Policy Our current intention is to pay holders of our Class A common stock and nonvoting Class A common stock a quarterly dividend representing at least 85% of TPG Inc.’s share of distributable earnings attributable to the TPG Operating Group, subject to adjustment as determined by th
Slide 63: Definitions
Definitions After-tax Distributable Earnings (“After-tax DE”) is a non-GAAP performance measure of our distributable earnings after reflecting the impact of income tax expense. We use it to assess how income tax expense effects amounts available to be distributed to our partners. After-tax DE differ
Slide 64: Definitions (Cont'd)
Definitions (Cont’d) Fee-Related Earnings(“FRE”) is a supplemental performance measure and is used to evaluate our business and make resource deployment and other operational decisions. FRE differs from net income computed in accordance with GAAP in that it adjusts for the items included in the calc