CD Private Equity Fund II · ASX:CD2
CD Private Equity Fund II — Investor Presentation (January 2024)
26 slides from CD Private Equity Fund II's investor presentation, Jan 31, 2024
Slide 1: Unitholder Presentation
For personal use only Unitholder Presentation ASX Release: 31 January 2024
Slide 2: Presenters
Hollie Wight For personal use only Managing Director (MD) Head of RE & Trustee Services George Boubouras JONATHAN SINEX Managing Director (MD) Managing Director Head of Research & Investment Cordish Equity Partners Advisory Sarah Connelly Head of Investor Relations
Slide 3: Disclaimer
DISCLAIMER This CD Fund Series Update (Update) has been prepared by K2 Asset Management Ltd as Responsible Entity (ACN 085 445 094, AFSL 244 393) of the CD Private Equity Fund Series (Funds or Fund Series) which includes CD Private Equity Fund I (ARSN 158 625 284) (ASX: CD1), CD Private Equity Fund
Slide 4: Agenda
05 Cordish Equity Partners Overview & Fund Series Recap For personal use only 07 Market Update 08 Fund Series Performance 13 Fund Series NTA Discount 14 Fund Series Liquidity (CD1 & CD4) 17 2024 Fund Specific Focus Q&A 18 [Live Presentation] 21 Appendix
Slide 5: Investing in small-cap private U.S. businesses through funds and direct investments
Investing in Small-Cap private U.S. businesses, through funds and direct investments SMALL CAP • Large opportunity set with 100ks of companies with US$10-250M For personal use only in revenues 2012 • Significantly more attractive upfront valuation multiples compared to public markets INCEPTION • Mul
Slide 6: Returns since inception
RETURNS SINCE Inception Date August 2012 April 2013 July 2016 April 2018 INCEPTION For personal use only Original Unit Price $1.60 $1.60 $1.60 $1.60 Total Distributions since $2.82 $2.31 $1.839 $0.575 Inception (per unit)1 Total Distribution Return 1.76x 1.44x 1.15x 0.36x per unit (DPI)1 31 December
Slide 7: State of the market
STATE OF Overall, PE markets recorded positive results across 2023 THE MARKET (compared to 2022) however deal activity did have to adjust to the higher interest rate market and the year proved difficult for exits. Higher for longer For personal use only interest rates have put The industry has begun
Slide 8: Fund Series 2023 Exits & Valuation Uplift
FUND SERIES 2023 Exits & Valuation Uplift EXITS: 2023 Number of Median Gross Median Valuation 6 month to Fund Realisations MOIC on Exit 6 months prior Exit Uplift 20 CD1 2 2.5x 2.0x +28% For personal use only CD2 3 1.2x 1.0x +19% PORTFOLIO COMPANY USD1 1 0.2x 0.2x 0% REALISATIONS CD3 7 3.8x 2.8x +36
Slide 9: Fund Series 2023: Portfolio Company Exits
FUND SERIES 2023: Portfolio Company Exits Fund 3 EXITS: 2023 Fund 1 Fund 4 20 For personal use only PORTFOLIO COMPANY REALISATIONS IN 2023 Fund 2 219 PORTFOLIO COMPANY REALISATIONS SINCE INCEPTION Representative current portfolio companies can be found on the “Portfolio Companies” section of the Fun
Slide 10: All Exits Since Inception – Return Distribution
FUND SERIES All Exits Since Inception – Return Distribution EXITS: SINCE 60 55 INCEPTION 50 49 48 For personal use only Cordish investment 40 philosophy is focused on 35 32 growth: growth buyouts 30 and growth equity 20 70% of all realisations from the portfolio have a 10 resulted in a MOIC of 2x or
Slide 11: Fund Series Distributions (per unit) Since Inception
FUND SERIES Fund Series Distributions (per unit) Since Inception DISTRIBUTIONS $3.00 $2.82 Fund Full Year 2023 $2.50 For personal use only $2.31 (inception) Distributions CD1 (2012) $0.19 per unit $2.00 $1.839 CD2 (2013) $0.255 per unit $1.50 CD3 (2016) $0.33 per unit CD4 (2018) $0.225 per unit $1.0
Slide 12: Post-tax NTA Return, including Distributions
FUND SERIES Post-tax NTA Return, including Distributions PERFORMANCE Inception 3 years 5 years Inception Fund 3m 6m 1 year 31 December 2023 Date p.a. p.a. p.a. Fund For personal use only NTA CD1 August 2012 -6.4% -3.0% -3.9% 13.6% 12.5% 11.7% CD1 $1.02 per unit CD2 April 2013 -6.1% 9.5% -0.1% 15.4%
Slide 13: Discount to NTA: NTA Per Unit & Share Price
DIS COU N T NTA Per Unit & Share Price: 31 December 2023 TO N T A 2 1.8 $1.87 24% For personal use only The Fund series is unique for 1.6 discount Australian markets, being listed 1.4 $1.54 and not evergreen. 30% $1.42 1.2 discount The Funds are designed to be 1 26% $1.085 $1.02 self-liquidating, re
Slide 14: Liquidity: CD1 – Fund History
L I QUI DI T Y CD1 – Fund History As the Fund enters the end of Inception Date August 2012 the 11th year, we appreciate For personal use only the length of time Unitholders Original Unit Price $1.60 have been invested in the Fund. Total Distributions since Inception (per unit)1 $2.82 The Manager bel
Slide 15: Liquidity: CD4 – Fund History
L IQUI DI T Y CD4 – Fund History The Fund is approaching the Inception Date April 2018 end of the fifth year of For personal use only operation, having returned Original Unit Price $1.60 36% 1 of the total called capital to Unitholders to date. Total Distributions since Inception (per unit)1 $0.575
Slide 16: CD4 Liquidity: Off Market Liquidity Event
Off Market Liquidity Event CD4 Following a review of the CD1-3 ASX Listed Funds, it has L IQUI DI T Y been determined that the listing of CD4 will likely result in a similar persistent discount to NTA coupled with modest K2 is seeking feedback from trading volume. For personal use only CD4 Unitholde
Slide 17: 2024 Fund Specific Focus
2024: • Continued realisation of portfolio companies is expected to continue through to 2027, with proceeds being returned to Unitholders by way of distributions. FUN D • The Manager expects to explore alternate liquidity options, including a portfolio sale. S PECI FI C • 26 portfolio companies rema
Slide 18: Q&A
Q&A We will now open up to questions from Unitholders. If you would like to submit a question and have not done so already, please complete your question card For personal use only and hand it to a K2 staff-member. We endeavour to answer all questions, grouping those which are similar. Questio
Slide 19: Q&A
Q&A For personal use only [email protected] (03) 9691 6110 19
Slide 20: Thank You
TH AN K YOU Thank you for attending this presentation. Unitholders are welcome to reach out to the For personal use only Investor Relations team via email or phone. • [email protected] • 61 3 9691 6110. 20
Slide 21: Appendix
For personal use only APPEN DI X 21
Slide 22: CD1 Fund's Interest In Assets of the LP
CD1 Fund’s Interest In Assets of the LP $USD millions Quarterly LP Cash $2.6 Financial Trivest Fund V, LP Karp Reilly Capital Partners II, LP $5.8 $4.1 Position For personal use only Encore Consumer Capital Fund II, LP $3.4 FPC Small Cap Fund I, LP $0.9 CD1 has an 85.53% interest in the Limited Part
Slide 23: CD2 Fund's Interest In Assets of the LP
CD2 Fund’s Interest In Assets of the LP $USD millions Quarterly LP Cash $4.5 Tengram Capital Partners Gen 2 Fund, LP $2.7 Financial Trive Capital Fund I, LP $0.6 Position For personal use only High Road Capital Partners Fund II, LP $3.8 NMS Fund II, LP $3.0 Tower Arch Partners I, LP $1.5 CD2 has an
Slide 24: CD3 Fund's Interest In Assets of the LP
Fund’s Interest In Assets of the LP $USD millions CD3 LP Cash $13.5 Quarterly DFW Capital Partners V LP Elephant Partners I LP $2.3 $5.7 Financial Encore Consumer Capital Partners III LP PeakSpan Capital $5.0 $3.6 Position For personal use only Trive Capital Fund II LP $4.6 Gemspring Capital $7.5 CD
Slide 25: CD4 Fund's Interest In Assets of the LP
CD4 Fund’s Interest In Assets of the LP $USD millions LP Cash $23.3 Quarterly Trivest Fund $9.3 Financial Elephant Partners II LP $15.5 Astra Partners I $8.7 Position Nosara Capital Fund I LP $17.3 For personal use only Quad Partners V LP $2.4 Gainline Equity Fund LP $11.6 CD4 has an 88.37% interest
Slide 26: Notes
Notes All figures are in AUD unless otherwise noted. Figures throughout the document may not sum due to rounding. AUD:USD 31 December 2023 spot rate of 0.6812 used. Source (CD1, CD2 & CD3): E&P Investments Limited (for data before 24 June 2023) and K2 Asset Management Ltd (for data post 24 June 20
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