Capman Oyj Class B · OMXHEX:CAPMAN
Capman Oyj Class B — FY2011 Earnings Presentation
49 slides from Capman Oyj Class B's earnings presentation, Feb 3, 2012
Slide 1: CapMan Group's result 2011
CapMan Group’s result 2011 Press and Analyst conference 3 February 2012 Lennart Simonsen, CEO, Senior Partner Certain statements included in this material, including, without limitation, statements regarding future performance of the company, expectations regarding market growth and trend projection
Slide 2: Contents
• CapMan in short Contents • Business environment • Activity and result 2011 2 CapMan Group’s Result 2011 3 February 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’s Result 2011 3 February 2012
Slide 4: Four key investment partnerships
Four key investment partnerships CapMan CapMan CapMan CapMan Buyout Russia Public Market Real Estate • Unlisted Nordic mid- • Growth financing in • Listed Nordic small • Commercial and market companies Russian SMEs with and mid cap hotel properties, • Both equity and minority positions companies and
Slide 5: Active owner for portfolio companies and real estate
Active owner for portfolio companies and real estate CapMan CapMan CapMan CapMan Buyout Russia Public Market Real Estate 37 portfolio companies and 58 real estate properties €5.5 billion 38,700 700,000 m² net sales* personnel lettable area * 2010 figures 5 CapMan Group’s Result 2011 3 February 2012
Slide 6: Demonstrated capability to create value
Demonstrated capability to create value 31 December 2011 • 3.0x money back multiple for investments in portfolio companies* • IRR 32% • Average holding period 5.4 years • 2.0x money back multiple for real estate investments** • IRR 57% (equity) • Average holding period 1.7 years * 76 exits by Buyout
Slide 7: 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 8: Our vision
Our vision By 2020 we are the best-performing European private equity firm 8 CapMan Group’s Result 2011 3 February 2012
Slide 9: Strategy
Strategy CapMan’s strategy is to combine… …the …all strengths of capabilities entrepreneurial AND within partnerships… CapMan… …to provide excellent returns to investors. 9 CapMan Group’s Result 2011 3 February 2012
Slide 10: Significant events 2011
Significant events 2011 • Q1 – New vision and mission – Updated strategy – Four key investment areas – New financial objectives • Q2 – Sale of real estate consulting business – Decision to close the Danish office • Q3 – Close co-operation initiated with NEP Partners to expand real estate operations
Slide 11: Contents
• CapMan in short Contents • Business environment • Activity and result 2011 11 CapMan Group’s Result 2011 3 February 2012
Slide 12: Investment operations
Investment operations
Slide 13: Deal activity slowed down during Q4
Deal activity slowed down during Q4 Number of buyout deals Buyout deal value in the Nordic region in the Nordic region # €bn 100 30 25 80 63 20 60 15 €10.1bn 40 10 20 5 0 0 2005 2006 2007 2008 2009 2010 2011 2004 2005 2006 2007 2008 2009 2010 2011 Full year / Q1 Q2 Q3 Q4 Full year / Q1 Q2 Q3 Q4 Sour
Slide 14: Leverage ratios fairly constant
Leverage ratios fairly constant Leverage ratios in European small & mid-sized transactions* 6.0x 5.0x 4.1x 3.7x 4.0x 3.0x 2.0x 1.0x 0.0x 2006 2007 2008 2009 2010 2011 Debt/EBITDA Senior Debt/EBITDA * European buyouts (EV<250MEUR) Source: S&P LCD European Leveraged Buyout Review Jan-Dec 2011. 14 CapM
Slide 15: Domestic buyers still dominating Finnish real estate market
Domestic buyers still dominating Finnish real estate market Development of transaction value in the Finnish commercial property market €bn 8 6 4 €1.8bn 2 0 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 Domestic buyer International buyer Source: KTI 15 CapMan Group’s Result 2011 3 February 2
Slide 16: Fundraising
Fundraising
Slide 17: Fundraising continues to be challenging
Fundraising continues to be challenging… Capital committed to European buyout funds $bn 100 90 …but interest 80 towards 70 Nordic funds 60 is relatively 50 high 40 $23bn 30 20 10 0 2006 2007 2008 2009 2010 2011 Source: Preqin Private Equity Spotlight, December 2011 17 CapMan Group’s Result 2011 3 Fe
Slide 18: Global real estate fundraising remains highly competitive
Global real estate fundraising remains also highly competitive… Capital committed to private equity real estate funds globally $bn # funds 160 300 140 250 …and countries 120 with good 100 200 economic 80 150 outlook attract most interest 60 100 from investors 40 50 20 0 0 2006 2007 2008 2009 2010 20
Slide 19: Impact of sovereign wealth crisis on LPs' investment strategies
Impact of sovereign wealth crisis on LPs’ investment strategies in Europe LPs’ plans for European fund commitments in the next 2–3 years 35 % 30% 30 % 25 % 20 % 15 % 8% 10 % 5% 0% Venture capital Growth capital ($1bn or more) Mid-market buyout Small buyout (deal size: Large buyout ($200m-$999m) <$20
Slide 20: Investors continue to be positive towards private equity
Investors continue to be positive towards private equity Global demand, international institutional investors interviewed in December 2011 Investors’ long term plans towards private Time frame for next intended commitments to equity allocations private equity funds 100% 8% 12% 17% 80% 7% 60% 70% 61%
Slide 21: Challenges in the private equity industry
Challenges in the private equity industry Solvency II bad news for private equity investments by insurance companies Basel III bad news for private equity investments by banks LPs are also increasingly picky in GP relationships 21 CapMan Group’s Result 2011 3 February 2012
Slide 22: Contents
• CapMan in short Contents • Business environment • Activity and result 2011 22 CapMan Group’s Result 2011 3 February 2012
Slide 23: New investments in 2011
New investments in 2011 • New and add-on investments totalled €225.3 million • CapMan’s own investments in funds totalled €11.9 million – Majority in CapMan Buyout IX and CapMan Public Market funds Investments during review period * *Investment by CapMan Public Market Fund that has not yet been disc
Slide 24: Exits during 2011
Exits during 2011 • Cash flow from exits and partial exits during 2011: – To investors approx. €284 million – To CapMan approx. €23 million* Most significant exits completed in the review period Partial exit announced. *Including cash flow from Maneq funds 24 CapMan Group’s Result 2011 3 February 20
Slide 25: Group turnover and operating profit
Group turnover and operating profit Turnover Operating profit / loss € million € million 40 38.2 30 32.4 29.7 30 21.0 25.6 20 21.0 20 15.7 11.0 11.1 11.4 10 9.2 10 8.2 6.0 4.3 4.0 4.5 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2010 2011 2010 2011 25 CapMan Group’s Result 2011 3 February 2012
Slide 26: Components of income and operating costs
Components of income and operating costs 31 December 2011 € million 50 12.8 0.6 -34.9 45 40 Operating profit €11.1 million 35 3.1 1.2 30 1.0 27.1 25 Profit before tax 20 €13.7 million 2.1 15 0.6 10 5 0 Management fees Income from real estate consulting Carried interest Other income Fair value gains
Slide 27: Management Company business slightly negative
Management Company business Management Company business slightly negative € million 2011 2010 • Management fees decreased as 32.4 38.2 expected from the comparable Turnover period Management fees 27.1 32.9 Real estate consulting 1.0 1.6 • Carried interest relates primarily to Carried interest 3.1 2.
Slide 28: Management fees and carried interest
Management Company business Management fees and carried interest Management fees Carried interest € million € million 40 10 32.4 8 30 27.1 29.7 25.6 6 20 21.0 15.7 4 3.0 3.1 2.4 2.5 2.6 2.6 10 11.4 8.2 2 0.4 0.4 0 0 1-3 1-6 1-9 1-12 1-3 1-6 1-9 1-12 2010 2011 2010 2011 28 CapMan Group’s Result 2011
Slide 29: CapMan's carried interest base
Management Company business CapMan’s carried interest base 31 December 2011 Portfolios at fair value (equity) by funds’ carried interest phase, in total €1.6bn 12 % 1% Funds generating carried interest, €18.1 million Funds in exit and value creation phase, €748.9m million 48 % Funds in active invest
Slide 30: Analysing CapMan Equity VII A, B and Sweden
Management Company business Analysing CapMan Equity VII A, B and Sweden A Sweden B originally 65% buyout, 35% tech allocation 100% buyout Fund size ~paid in capital, €m 156.7 67.0 56.5 Capital returned to investors, €m 148.0 63.6 69.1 Remaining portfolio at fair value, €m 75.6 32.4 31.4 Amount of ca
Slide 31: Analysing CapMan Equity VII A, B and Sweden
Management Company business Analysing CapMan Equity VII A, B and Sweden 31 December 2011 • 8 companies in buyout portfolio – 3 companies have been partially exited • 9 companies in technology portfolio • Aggregate fair value of the portfolios: €139.4 million Buyout portfolio Technology portfolio Par
Slide 32: Analysing impact of own investments: CapMan Buyout VIII
Management Company Analysing impact of own investments and business Fund Investment carried interest potential: CapMan Buyout VIII business 31 December 2011 CAPMAN BUYOUT VIII In total Fund size: €440.0 million Paid-in capital: €374.6 million Portfolio at fair value: €262.5 million Cash flow to inve
Slide 33: Result for Fund Investment business improved significantly from 2010
Fund Investment Result for Fund Investment business improved business significantly from 2010 € million 2011 2010 • Increase of approx. 22% in fair Fair value gains/losses of values during 2011 12.8 2.7 investments – Exits accounted for approx. 40% Operating profit / loss 12.2 2.1 of changes in fair
Slide 34: Factors affecting the fair value development
Fund Investment business Factors affecting the fair value development Peer group (Nordic mid cap) trading 1-12/2011 Other factors 310 280 OMX Nordic Mid Cap 250 Financial performance of the companies 220 M&A transactions in the industry 190 160 Preliminary exit negotiations 130 100 03.01.11 03.02.11
Slide 35: Changes in fair values of investments
Fund Investment business Changes in fair values of investments • Fair values of investments (CapMan’s own investments) – Change 1-12/2011: €12.8 million or 21.8% – Change in Q3 2011: €2.6 million or 3.9% • Exits accounted for approximately 40% of fair value changes. – In addition, the development of
Slide 36: Fair values of investments
Fund Investment business Fair values of investments 31 December 2011 Changes in fair values of portfolio Changes in fair values of real estate companies in 2011* investments in 2011* 3 %2 % 15 % 27 % 29 % 40 % 66 % 18 % New investments New investments Fair value increased Fair value increased Fair v
Slide 37: Fund investments and commitments totalled €94.6 million
Fund Investment business Fund investments and commitments totalled €94.6 million €m Majority of investments and commitments in buyout funds 60 50 40 30 20 10 0 Buyout, 59% Russia, 5% Public Market, Real Estate, 7% Other, 17% Access, 7% 4% • Investments in fair value, in total €70.2 million (lower pa
Slide 38: Key holdings for CapMan through own fund investments
Fund Investment business Key holdings for CapMan through own fund investments 31 December 2011 Company Business Net sales, Personnel** Fund(s) Investment M€* year Toiletries, household, CMB VIII wound care, and 240.4 800 2008 CMM IV healthcare products Technical laminates and protective 294.4 1,003
Slide 39: 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 2011 Performance Return on equity over 20% p.a. Return
Slide 40: CapMan guidance – 2012 result
CapMan guidance – 2012 result • CapMan’s next major fundraising rounds will take place in 2012. The development of the company’s management fees during 2012 will depend on the timing of exits made from current funds and the size and timing of new funds to be established. • Our operating expenses wil
Slide 41: Annual General Meeting 2012
Annual General Meeting 2012 Date and venue 14 March 2012, at 10.00 am EET Address : Yrjönkatu 18, 00180 Helsinki (G18) Dividend proposal €0.07 per share Proposal of new Karri Kaitue, LL. Lic. , b. 1964, Board memebers Board professional Proposal of re-election • Nora Kerppola • Claes de Neergaard •
Slide 42: IR calendar and IR team
IR calendar and IR team IR calendar 2012 IR team AGM Lennart Simonsen, CEO, Senior Partner Tel. +358 207 207 567 14 March 2012, Helsinki [email protected] Q1 Result 4 May 2012 Jerome Bouix, Head of Sales, Marketing, Investor Relations and Communications, Senior Partner Q2 Result Tel. +358
Slide 43: Additional slides
Additional slides
Slide 44: Key figures as of December 2011
Key figures as of 31 December 2011 31 Dec ‘11 31 Dec ‘10 Earnings per share, cents* 10.1 17.7 Diluted, cents 10.1 17.7 Shareholders' equity / share, cents** 104.7 107.7 Share issue adjusted number of shares 84,255,467 84,255,467 Number of shares at the end of period 84,281,766 84,281,766 Number of s
Slide 45: Group Income Statement
Group Income Statement € million 1-12/11 1-12/10 Turnover 32.4 38.2 Management fees 27.1 32.9 Carried interest 3.1 2.6 Real Estate consulting 1.0 1.6 Other income 1.2 1.1 Other operating income 0.6 23.0 Operating expenses -34.9 -42.8 Fair value gains / losses of investments 12.8 2.7 Operating profit
Slide 46: Group Balance Sheet – Assets, IFRS
Group Balance Sheet – Assets, IFRS € thousands 31 Dec ’11 31 Dec ’10 Tangible assets 438 602 Goodwill 6,204 6,406 Other intangible assets 1,881 2,424 Investments in associated companies 8,347 6,400 Investments at fair value through profit and loss Investments in funds 70,167 66,504 Other financial a
Slide 47: Group Balance Sheet – Total equity and liabilities, IFRS
Group Balance Sheet – Total equity and liabilities, IFRS € thousands 31 Dec ’11 31 Dec ’10 Share capital 772 772 Share premium account 38,968 38,968 Other reserves 38,679 38,679 Translation difference 38 69 Retained earnings 9,784 12,241 Capital attributable the Company's equity holders 88,241 90,72
Slide 48: CapMan's ownership
CapMan’s ownership 31 December 2011 6% 20 % 25 % 23 % 24 % 18 % 29 % 55 % Nominee registered and foreign shareholders Management and employees of CapMan* Corporations Other shareholders Nominee registered shareholders Households Non-profit and public sector institutions Financial and insurance corpo
Slide 49: CapMan Plc's largest shareholders
CapMan Plc’s largest shareholders 31 December 2011 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 4.0