Annual General Meeting 7 July 2004 1 Annual General Meeting 7 July - PowerPoint PPT Presentation

Annual General Meeting 7 July 2004 1

Annual General Meeting 7 July 2004 2

Baroness Hogg Chairman 3

The Board of Directors 4

Dr John Forrest 5

Christine Morin-Postel 6

Rod Perry 7

Danny Rosenkranz 8

Tony Brierley 9

Brian Larcombe 10

Oliver Stocken 11

Michael Queen 12

Martin Gagen 13

Fred Steingraber 14

Annual General Meeting 7 July 2004 Philip Yea  A wide range of experience in industry and private equity  Formerly with Investcorp  Before that Finance Director of Diageo  Proposed appointment widely welcomed by shareholders and analysts 15

Annual General Meeting 7 July 2004 “3i delivers a strong overall performance.” 16

Annual General Meeting 7 July 2004 Share price since flotation 3i Group FTSE 100 2000 FTSE All Share 1800 FTSE Small Cap (exc IT) 1600 1400 1200 1000 800 600 400 200 0 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Source: Datastream 17

Annual General Meeting 7 July 2004 3i European Barometer Index 100 4.5 80 4 60 3.5 40 3 20 Index 2.5 0 GDP growth -20 2 -40 1.5 -60 1 -80 0.5 -100 -120 0 Q2 Q4 Q2 Q4 Q2 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 1998 1999 2000 2001 2002 2003 2004 18

Annual General Meeting 7 July 2004 Investing in 3i - corporate responsibility “3i is clearly positioned among the best in the financial services industry.” “It is a real achievement to be one of the Companies that Count.” 19

Annual General Meeting 7 July 2004 20

Brian Larcombe Chief Executive 21

Annual General Meeting 7 July 2004 Performance highlights – year to 31 March 2004  Strategy delivering  Significant pick up in investment activity  Good flow of realisation profits  An overall return of 18.1% 22

Annual General Meeting 7 July 2004 Total return by investment product 2004 %* 22.6% Mid-market buy-outs 22.1% Smaller buy-outs 26.8% Growth capital (6.0)% Venture capital * % total return on opening shareholders’ funds attributed to each product 23

Annual General Meeting 7 July 2004 Venture capital Growth capital Buy-outs 3i’s venture capital 3i’s buy -out business is Our growth capital business is focused on business is focused on focused on the mid and the healthcare, software, high growth companies, smaller buy-out markets communications and expanding organically in Europe and Asia electronics, or through acquisition. Pacific. semiconductors and advanced technologies (“ESAT”) sectors. Portfolio value Portfolio value Portfolio value 12% 35% 53% £533m £1,487m £2,306m 53% 24

Annual General Meeting 7 July 2004 Directories 25

Annual General Meeting 7 July 2004 Yellow Brick Road 44% of company with Yellow EBITDA of € 150m Brick Road Debt € 1bn Cash back € 31m € 224m to 3i and Mediatel funds € 65m De Telefoongids € 44m Fonecta 26

Annual General Meeting 7 July 2004 Investing in 3i - our people 27

Annual General Meeting 7 July 2004 Investing in 3i - our network  Preferred deal flow  Investment assessment  Added value  Enhanced exits Aberdeen, Amsterdam, Barcelona, Birmingham, Boston, Bristol, Cambridge, Copenhagen, Dusseldorf, Frankfurt, Glasgow, Helsinki, Hong Kong, Leeds, London, Lyon, Madrid, Manchester, Menlo Park, Milan, Munich, Paris, Reading, Singapore, Stockholm, Stuttgart, Vienna, Zurich 28

Annual General Meeting 7 July 2004 Strategy  Developing the business internationally  Building a balanced investment business  Using the network as our key competitive advantage  Investing in growth companies 6% 12% Buy-outs Growth capital 51% Venture capital Quoted 31% 29

Annual General Meeting 7 July 2004 Closing remarks “3i is in great shape and is strongly positioned to grow value significantly in the years ahead.” 30

Annual General Meeting 7 July 2004 31

Michael Queen Finance Director 32

Annual General Meeting 7 July 2004 Financial highlights  Total return £531m  Total return on opening shareholders’ funds 18.1%  Net asset value per share 553p  Final dividend 8.9p  Realised profits on disposal £228m  New investment* £979m * New investment includes co-investment funds 33

Annual General Meeting 7 July 2004 Total return – key drivers  Strong realisation profits £228m  Good portfolio value growth £336m  Income slightly lower £234m 34

Annual General Meeting 7 July 2004 Balance sheet 2003 2004 £m £m Investment assets 3,939 4,326 Other net assets 10 5 3,949 4,331 Net borrowings 1,013 936 Shareholders’ funds 2,936 3,395 3,949 4,331 Gearing 35% 28% 35

Annual General Meeting 7 July 2004 Net cash flow - long term trend £m 2,000 Cash inflow Cash outflow 1,500 Net cash flow 1,000 500 0 -500 -1,000 -1,500 -2,000 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 for year to 31 March 36

Annual General Meeting 7 July 2004 Dividend history pence 16 13.5 14.0 14 13.0 13.0 12.2 12 11.3 10.3 10 9.2 8.1 8 7.2 6 4 2 0 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 Interim Final 37

Annual General Meeting 7 July 2004 Financial summary  Significant improvement in total return  Net investor in the second half  Strong balance sheet  Excellent liquidity 38

Annual General Meeting 7 July 2004 39

Nigel Jones Ernst & Young 40

The Resolutions 41

Annual General Meeting 7 July 2004 Resolution 1 “THAT the Company’s Accounts for the year ended 31 March 2004 and the Directors’ report and Auditors’ report thereon be and they are hereby received and considered” Proxy votes lodged for this Resolution: 98.73% For, 0.54% Discretionary, 0.27% Abstain and 0.46% Against 42

Annual General Meeting 7 July 2004 Resolution 2 “THAT the Directors’ Remuneration report for the year ended 31 March 2004 be and it is hereby approved” Proxy votes lodged for this Resolution: 87.88% For, 0.54% Discretionary, 6.25% Abstain and 5.33% Against 43

Annual General Meeting 7 July 2004 Resolution 3 “THAT a final dividend of 8.9 pence per share net be and it is hereby declared, payable to those shareholders whose names appeared on the Register of Members at close of business on 18 June 2004” Proxy votes lodged for this Resolution: 99.45% For, 0.54% Discretionary, 0.01% Abstain and 0% Against 44

Annual General Meeting 7 July 2004 Resolution 4 “THAT Baroness Hogg be and she is hereby reappointed as a Director of the Company” Proxy votes lodged for this Resolution: 99.36% For, 0.55% Discretionary, 0.03% Abstain and 0.06% Against 45

Annual General Meeting 7 July 2004 Resolution 5 “THAT Mr P E Yea be and he is hereby appointed as a Director of the Company” Proxy votes lodged for this Resolution: 99.06% For, 0.55% Discretionary, 0.35% Abstain and 0.04% Against 46

Annual General Meeting 7 July 2004 Resolution 6 “THAT Ernst & Young LLP be and they are hereby reappointed as Auditors of the Company to hold office until the conclusion of the next General Meeting at which Accounts are laid before the Members” Proxy votes lodged for this Resolution: 98.09% For, 0.55% Discretionary, 0.67% Abstain and 0.69% Against 47

Annual General Meeting 7 July 2004 Resolution 7 “THAT the Board be and it is hereby authorised to fix the Auditors’ remuneration” Proxy votes lodged for this Resolution: 99.21% For, 0.55% Discretionary, 0.02% Abstain and 0.22% Against 48

Annual General Meeting 7 July 2004 Resolution 8 "THAT executive Directors be and they are hereby authorised to participate in the incentive arrangements described in the notes relating to this Resolution 8 set out in the Notice of Annual General Meeting dated 14 May 2004" Proxy votes lodged for this Resolution: 94.53% For, 0.55% Discretionary, 2.04% Abstain and 2.88% Against 49

Annual General Meeting 7 July 2004 Resolution 9 To renew the Directors' authority to allot shares (The full text of this Resolution is set out in the Notice of Meeting) Proxy votes lodged for this Resolution: 98.80% For, 0.50% Discretionary, 0.47% Abstain and 0.23% Against 50

Annual General Meeting 7 July 2004 Resolution 10 Special Resolution To renew the Directors' authority to allot shares for cash (The full text of this Resolution is set out in the Notice of Meeting) Proxy votes lodged for this Resolution: 98.78% For, 0.55% Discretionary, 0.48% Abstain and 0.19% Against 51

Annual General Meeting 7 July 2004 Resolution 11 Special Resolution To renew the Company's authority to purchase its own shares (The full text of this Resolution is set out in the Notice of Meeting) Proxy votes lodged for this Resolution: 99.40% For, 0.56% Discretionary, 0.02% Abstain and 0.02% Against 52

Annual General Meeting 7 July 2004 53