Capman Oyj Class B · OMXHEX:CAPMAN
Capman Oyj Class B — Q3 2012 Earnings Presentation
45 slides from Capman Oyj Class B's earnings presentation, Nov 1, 2012
Slide 1: CapMan Group interim results 1 January – 30 September 2012
CapMan Group interim results 1 January – 30 September 2012 Helsinki 1 November 2012 Lennart Simonsen – CEO Niko Haavisto – CFO Certain statements included in this material, including, without limitation, statements regarding future performance of the company, expectations regarding market growth and
Slide 2: Contents
• CapMan in short Contents • Business environment • Activity and results January – September 2012 2 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 3: CapMan
CapMan • Unique listed private equity fund manager • More than 20 years’ experience from Nordic and Russian private equity • Strong local presence and market coverage 3 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 4: Four key investment partnerships
Four key investment partnerships Active owner and developer of portfolio companies Unique presence in Finland, Sweden, Norway and Russia CapMan CapMan CapMan CapMan Buyout Russia Public Market Real Estate • Nordic mid-market • Growth financing in • Listed Nordic small • Commercial and companies Russ
Slide 5: CapMan's attractive earnings model
CapMan’s attractive earnings model Management Company Business Fund Investment Business Investments from CapMan’s own balance Private Equity Fund Management sheet into funds under its management Management Fees Carried Interest Based on the amount of 10-20% of the fund’s cash flow Return of Fund Inv
Slide 6: Active owner of portfolio companies and real estate
Active owner of portfolio companies and real estate CapMan CapMan CapMan CapMan Buyout Russia Public Market Real Estate 38 portfolio companies and 57 real estate properties €5.5 billion 38,200 680,000 m² net sales* personnel lettable area * 2012E figures 6 CapMan Group Interim Results 1 Jan - 30 Sep
Slide 7: Demonstrated value creation capability
Demonstrated value creation capability Portfolio company investments Real estate investments 350 350 300* 300 300 250 250 IRR 32% IRR 55% 200** 200 200 Average holding period Average holding period 5.4 years 1.7 years 150 150 100 100 100 100 50 50 0 0 Value at investment Value at exit Value at inves
Slide 8: Major Nordic private equity firms
Major Nordic private equity firms BUYOUT CapMan is well- positioned on all markets PUBLIC MARKET Accendo Capital Partners Oy REAL ESTATE RUSSIA 8 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 9: Organisation
Organisation CEO Management Group Entrepreneurial investment partnerships* CapMan CapMan CapMan Public CapMan Real Buyout Russia Market Estate CapMan Platform Sales, Marketing, Investor Finance, Back Office, Relations and Communications Legal and IT Human Resources * Other CapMan investment areas do
Slide 10: Our vision
Our vision By 2020 we are the best-performing European private equity firm 10 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 11: Strategy
Strategy CapMan’s strategy is to combine… …the …all strengths of capabilities entrepreneurial AND within partnerships… CapMan… …to provide excellent returns to investors. 11 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 12: Contents
• CapMan in short Contents • Business environment • Activity and results January – September 2012 12 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 13: Investment operations
Investment operations 13 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 14: Value and volume of Nordic buyout transactions declined during Q3 2012
Value and volume of Nordic buyout transactions declined during Q3 2012 Number of buyout deals Buyout deal value in the Nordic region in the Nordic region # €bn 100 30 67 25 80 20 60 41 €10.1 15 bn 40 10 €5.6 bn 20 5 0 0 2005 2006 2007 2008 2009 2010 2011 1-9/ 2004 2005 2006 2007 2008 2009 2010 2011
Slide 15: Leverage ratios edge higher
Leverage ratios edge higher Leverage ratios in European small & mid-sized transactions* 6.0x 4.2x 5.0x 3.9x 4.0x 3.0x 2.0x 1.0x 0.0x 2006 2007 2008 2009 2010 2011 1-9/ 2012 Debt/EBITDA Senior debt/EBITDA *European buyouts (EV<250 MEUR) Source: S&P LCD European Leveraged Buyout Review Jan-Sep 2012. 1
Slide 16: Domestic buyers still dominate the Finnish real estate market
Domestic buyers still dominate the Finnish real estate market Development of transaction volumes in the Finnish commercial property market €bn 8 6 4 €1.6bn 2 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 1-9/ 2012 Domestic buyer International buyer Source: KTI 16 CapMan Group Interim Resu
Slide 17: Fundraising
Fundraising 17 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 18: Buyout fundraising remains a challenge
Buyout fundraising remains a challenge… Capital commitments to European buyout funds $ Bn Funds (#) 160 120 140 100 …and the number of 120 closed funds and 80 amounts raised 100 remain well below 80 60 pre-crisis levels 60 40 40 16 20 $16.6 20 bn 0 0 2006 2007 2008 2009 2010 2011 1-9/ 2012 Commitmen
Slide 19: Record number of funds are currently in the market
Record number of funds are currently in the market… Private equity funds on the road 01/2008–10/2012 $ bn # of funds 1 200 2,000 1,918 1 000 $783 1,800 …and LPs are bn increasingly 800 selective in making 1,600 investment 600 decisions 1,400 400 1,200 200 0 1,000 01/2008 01/2009 01/2010 01/2011 01/2
Slide 20: Difficult real estate fundraising conditions persist
Difficult real estate fundraising conditions persist Capital commitments to real estate funds globally $ Bn Funds (#) 160 300 140 250 120 200 100 80 150 60 100 40 86 $27.3 50 bn 20 0 0 2003 2004 2005 2006 2007 2008 2009 2010 2011 1-9/ 2012 Commitment Funds (#) Source: Preqin Quarterly, Private Equit
Slide 21: Regulation poses additional challenges for fundraising
Regulation poses additional challenges for fundraising Solvency II bad news for private equity investments by insurance companies Basel III bad news for private equity investments by banks 21 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 22: Progress of CapMan's fundraising effort
Progress of CapMan’s fundraising effort We commenced fundraising in three key investment areas in Q1 2012. First closing by First closings by the end of Q1 the end of 2012 2013 We aim to raise more than €700 million during the ongoing fundraising round in 2012-2013. 22 CapMan Group Interim Results 1
Slide 23: Contents
• CapMan in short Contents • Business environment • Activity and results January – September 2012 23 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 24: Group turnover and operating profit
Group turnover and operating profit Turnover Operating profit € million € million 40 12 11.0 11.1 32.4 10 9.2 30 25.6 8 21.3 20 6 15.7 13.2 4.0 4 10 8.2 2.7 6.7 1.9 1.9 2 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2011 2012 2011 2012 24 CapMan Group Interim Results 1 Jan - 30 Sep 2012 1 November 2012
Slide 25: Breakdown of results
Breakdown of results 30 September 2012 € million 30 3.5 0.2 -23.1 25 Operating profit 1.1 1.9 €1.9 million 20 18.3 15 10 Profit before tax €2.7 million 5 0.3 0.4 0 Management fees Carried interest Other income Fair value gains and losses of investments Other operating income Operating costs Financia
Slide 26: Management Company profit negative
Management Company business Management Company profit negative € million 1-9/2012 1-9/2011 Turnover 21.3 25.6 Management fees decreased as expected from the comparable Management fees 18.3 20.7 period Real estate consulting 0.0 1.0 Carried interest 1.9 3.0 Carried interest income from the Other inco
Slide 27: Management fees and carried interest
Management Company business Management fees and carried interest Management fees Carried interest € million € million 30 4 27.1 3.0 3.1 20.7 3 18.3 20 13.9 2 1.9 12.4 10 7.1 6.2 1 0.4 0.4 0.0 0.0 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2011 2012 2011 2012 27 CapMan Group Interim Results 1 Jan - 30 Sep
Slide 28: CapMan's carried interest base
Management Company business CapMan’s carried interest base 30 September 2012 Portfolios at fair value (equity) by funds’ carried interest phase €24.5 2% € 129.1 8% € 255.3 Funds generating carried interest 17% Funds in exit and value creation phase €1.5bn in total Funds in active investment phase Fu
Slide 29: Analysing CapMan Equity VII A and Sweden
Management Company business Analysing CapMan Equity VII A and Sweden 30 September 2012 A Sweden Fund size ~paid in capital, €m 156.7 67.0 Capital returned to investors, €m 179.2 76.1 Remaining portfolio at fair value, €m 44.2 18.9 Amount of cash flow needed to transfer the fund to carry (30 37.1 17.
Slide 30: Analysing CapMan Equity VII A and Sweden
Management Company business Analysing CapMan Equity VII A and Sweden 30 September 2012 • 6 companies in buyout portfolio – Partial exits from 3 companies • 8 companies in technology portfolio • Aggregate fair value of the portfolios: €63.1 million Buyout portfolio Technology portfolio Partially exit
Slide 31: Analysing impact of own investments and carried interest potential: CM Buyout VIII
Management Company Analysing impact of own investments and business Fund Investment carried interest potential: CM Buyout VIII business 30 September2012 CAPMAN BUYOUT VIII In total Paid-in capital: €391.1 million Portfolio at fair value: €290.8 million Cash flow to investors: €158.6 million Cash flo
Slide 32: Active value creation through 18 add-on acquisitions during 2012
Management Company Active value creation through 18 add-on business Fund Investment acquisitions during 2012 business • Frontlite • Suomen • Vedderheia • Molins Kranar • Cargotec • Lumek • Playroom • Starlight Ensiapupalvelu Barnhage Estonia • Öhbergs • Erjan • Steinsviken Pumpservice Kotisairaanhoi
Slide 33: Positive result from fund investment business
Fund Investment business Positive result from fund investment business € million 1-9/2012 1-9/2011 Increase of approx. 5% in fair Fair value gains/losses of values between January and 3.5 10.2 investments September 2012. Operating profit 3.2 9.8 Profit for the period 3.5 9.5 Fair value gains are att
Slide 34: Factors affecting fair value development
Fund Investment business Factors affecting fair value development Financial performance of Preliminary exit portfolio companies negotiations Fair Peer group valuation Value Exchange rates, (OMX Nordic Mid Cap), 1-9/2012 1-9/2012 EUR/RUB EUR/SEK M&A transactions in EUR/NOK the industry 34 CapMan Grou
Slide 35: Fair value of investments
Rahastosijoitus- toiminta Fair value of investments 30 September 2012 Changes in fair values of 54 portfolio Changes in fair values of 58 real estate companies in 1-9/2012* investments in 1-9/2012* ** 6% 7% 22 % 31 % 39 % 33 % 62 % New investments New investments Fair value increased Fair value incr
Slide 36: Fund investments and commitments totalled €92.7 million
Fund Investment Fund investments and commitments business totalled €92.7 million €m Majority of investments and commitments in buyout funds 60 50 40 30 20 10 0 Buyout, 59% Russia, 6% Public Market, Real Estate, 8% Other, 16% Access, 6% 5% • Investments in fair value, in total €72.4 million (lower pa
Slide 37: Financial objectives
Financial objectives We believe that private equity remains a growth industry, and CapMan continues to exploit growth opportunities especially in its key investment areas. Growth will be a natural outcome of high performance. Objectives Realised Q3 2012 Performance Return on equity over 20% p.a. Ret
Slide 38: CapMan guidance – 2012 result
CapMan guidance – 2012 result • CapMan expects to complete first closings of fundraising for the Buyout X fund and the Nordic Real Estate fund during the current year and for the CapMan Russia II fund during the first quarter of 2013. • CapMan expects its pre-tax result to be positive in 2012, subje
Slide 39: IR calendar and IR team
IR calendar and IR team IR calendar 2012 IR team Sijoitus-Invest 2012 Lennart Simonsen, CEO, Senior Partner Tel. +358 207 207 567 14-15 Nov 2012 [email protected] Jerome Bouix, Head of Sales, Marketing, Investor Relations and Communications, Senior Partner Tel. +358 207 207 558 jerome.boui
Slide 40: Additional slides
Additional slides
Slide 41: Key figures as of 30 September 2012
Key figures as of 30 September 2012 30.9.12 30.9.11 31.12.11 Earnings per share, cents 0.5 10.1 10.1 Diluted, cents 0.5 9.9 10.1 Shareholders' equity / share, cents* 98.1 103.3 104.7 Share issue adjusted number of shares 84,255,467 84,255,467 84,255,467 Number of shares at the end of period 84,281,7
Slide 42: Group Income Statement, IFRS
Group Income Statement, IFRS € million 1-9/12 1-9/11 1-12/11 Turnover 21.3 25.6 32.4 Management fees 18.3 20.7 27.1 Carried interest 1.9 3.0 3.1 Real Estate consulting 0.0 1.0 1.0 Other income 1.1 0.9 1.2 Other operating income 0.2 0.6 0.6 Operating expenses -23.1 -25.4 -34.9 Fair value gains / loss
Slide 43: Group Balance Sheet – Assets, IFRS
Group Balance Sheet – Assets, IFRS € thousands 30.9.12 30.9.11 31.12.11 Tangible assets 457 467 438 Goodwill 6,204 6,204 6,204 Other intangible assets 1,640 1,995 1,881 Investments in associated companies 8,971 9,068 8,347 Investments at fair value through profit and loss Investments in funds 72,442
Slide 44: Group Balance Sheet – Total equity and liabilities, IFRS
Group Balance Sheet – Total equity and liabilities, IFRS € thousands 30.9.12 30.9.11 31.12.11 Share capital 772 772 772 Share premium account 38,968 38,968 38,968 Other reserves 38,814 38,679 38,679 Translation difference 44 70 38 Retained earnings 4,052 8,582 9,784 Total equity 82,650 87,071 88,241
Slide 45: CapMan Plc's largest shareholders
CapMan Plc’s largest shareholders 30 September 2012 Share of all shares % Share of all voting rights % Ilmarinen Mutual Pension Insurance Company 8.5% 5.3% Aristo Invest Oy + Ari Tolppanen* 8.3% 19.4% Winsome Oy + Tuomo Raasio* 4.5% 8.3% Varma Mutual Pension Insurance Company 4.4% 2.7% Vesasco Oy 4.