CapMan 2018 Results
Significant strategic projects were completed
J o a k i m F r i m o d i g , C E O H e l s i n k i , 3 1 J a n u a r y 2 0 1 9
CAPM AN PLC
CapMan 2018 Results Significant strategic projects were completed - - PowerPoint PPT Presentation
CAPM AN PLC 1-12 2018 CapMan 2018 Results Significant strategic projects were completed J o a k i m F r i m o d i g , C E O H e l s i n k i , 3 1 J a n u a r y 2 0 1 9 Statements regarding future development and disclaimer The
J o a k i m F r i m o d i g , C E O H e l s i n k i , 3 1 J a n u a r y 2 0 1 9
CAPM AN PLC
The following concerns this document, the related oral presentation by either CapMan Plc (hereinafter the "Company") or a representative of the Company as well as the subsequent Q&A sessions. This document published by the Company constitutes the written material of the presentation for potential investors regarding the possible offering of the Company's securities ("Securities"). The material set forth herein is not, and should not be construed as an offer to sell or a solicitation of an offer to subscribe or purchase any Securities, or a part of such offer. Nothing in this material shall form the basis of any contract and nothing in this should be relied upon in connection with any contract or commitment, and nothing in this constitutes a recommendation regarding the
detailed information concerning the Company and the Securities than set forth in this material, and potential investors should re-view the
document (or similar document) to conduct an independent research and evaluation of the Company's business, financial standing and nature of the Securities before making an investment decision regarding the Securities. Certain statements presented that are not historical facts, including, among others, estimates of the overall economic development and the market situation, expectations concerning the growth and profitability of the combined group, the realisation of synergy benefits and cost savings, as well as statements that contain the expressions "expects”, “estimates”, “forecasts”, “aims”, “believes”, “pursues”, “intends”, “could”, “anticipates” “plans”, “seeks”, “will”, “may”, “likely”, and “would” and
corresponding expressions
their negative variations identify forward-looking statements. Forward-looking statements are based
the Company's current expectations, estimates, decisions and plans as well as on the currently available facts regarding, among
the Company's financial standing, results
plans,
uncertainties that, if materialized, may cause the actual results of operations of the combined group to be materially different than currently expected. These factors include the overall economic conditions, including currency and interest rate fluctuations impacting the operating environment and profitability of clients and thereby the orders and margins on them received by the combined group; competition; the combined group's business conditions and continuous development and improvement thereof; and the success of possible future acquisitions. Forward-looking statements are further based on numerous assumptions concerning the Company's current and future strategy and the Company's future business environment. No liability is accepted and no explicit or implicit guarantee or warranty is given with regard to this material, and no undue reliance should be placed on the truthfulness, accuracy or completeness of the material or the opinions expressed herein. Portions of this material are in draft form. The information contained in this material has not been independently verified nor will it be updated. The information contained in this material, including forward-looking statements, applies only on the date of this material and is not intended to be a guarantee of the future results. Any unsourced market data used in the material is an estimate made by the Company and has not been independently
except in circumstances specified by law and explicitly waives any liability for the material.
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Expansion of BVK mandate to
€820m
Infra fund at
€140m
Fundraising continues as planned New infra mandate AUM growth >€400m Annual fee income growth >€4m (in full as of 1/2019) Acqusition of majority of JAM Advisors
significant growth potential
local tier II and III investors
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PRIVATE EQUITY & CREDIT REAL ESTATE INFRA
Buyout funds
CAPS SCALA
OPEN-ENDED FUNDS CLOSED FUNDS MANDATES, CLUBS, OTHERS INTERNATIONAL INVESTORS NORDIC TIER I INVESTORS NORDIC TIER II & III INVESTORS
JAM Advisors SERVICES
Own balance sheet Broad access to capital New & flexible products
Growth fund Credit funds Value added (NRE funds) Yield (NPI & Hotel funds)
Mandate Infra fund Mandates
Other funds
Broad offering in the private assets space Active value creation JAM
X-Ray & reporting
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Estate II fund established
Income fund established
area & fund established
established
growth
completed
expansion completed
strong growth continued
continues as planned
completed
majority of JAM Advisors
started
strong growth continues
products & new sources of capital explored
2017 2018 2019
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Growth in fees
22%
Capital raised since October
+€400m 20
new investments and
15
exits Growth in fee-based profitability
108%
Dividend proposal
€0.12/share
Return on fund investments
+10%
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Fees include management fees and service fees on group level. Operating profit includes Management Company and Service Business without carried interest.
24 25 26 27 28 29 30 31 32 33 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018
Fees (excluding carry), LTM
2018 +22%
MEUR MEUR
1 2 3 4 5 6 7 Q4 2016 Q1 2017 Q2 2017 Q3 2017 Q4 2017 Q1 2018 Q2 2018 Q3 2018 Q4 2018
Comparable operating profitability excluding carry (LTM)
+MEUR 6 2018
Towards more stability and predictability
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Illustrative data Time Time Time
Fee profit Balance sheet return Carry
CapMan historically CapMan today CapMan in the future – long-term objective
Carry Balance sheet return
ROE 20%
(Objective for average ROE) Carry Carry Fee profit
Hotels
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Short-term profitability Long term value upside
Buyout NRE
CaPS
Nest Infra fund
High Moderate Low High
BVK NPI
…to be complemented with new products and services CapMan’s long-term focus areas…
Traditional New in last 15 months
Infra managed account I
Scala Growth
Illustrative data
Strategic plan
Infra managed account II
New Private Equity products New Infra products New Credit products New Real Estate products New services JAM Advisors
7,5 16,6 26,0 34,8 8,5 19,9 27,1 36,0 5 10 15 20 25 30 35 40 1-3 1-6 1-9 1-12
Turnover
2017 2018 10,5 17,8 22,9 19,5 4,1 10,1 14,9 12,0 5 10 15 20 25 1-3 1-6 1-9 1-12
Operating profit
2017 2018
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MEUR MEUR
14,9 12,0 1,0 5,7 1,7 2 4 6 8 10 12 14 16 18 20 1-9 2018 Profit (ex. changes in FV) Changes in FV (ex. trading portfolio) Changes in trading portfolio FV 1-12 2018 Changes in FV (ex. trading portfolio) Profit (ex. changes in FV)
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MEUR
change in Q4 (vs. e.g. -15% for HEX)
in 2018, of which €21 million in Q1-Q3 2018 and €14 million in Q4.
core operations and therefore sell-down to continue in 2019
in 2018 at +10%
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CapMan share price and OMX Helsinki development Oct-18 to Jan-19
80,00 85,00 90,00 95,00 100,00 105,00 01/10/2018 01/11/2018 01/12/2018 01/01/2019
CapMan Plc OMX Helsinki
80,6 8,2 39,0 54,5 Fund investments Other investments Trading portfolio Cash & bank
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Investments in private markets 49% of total Total €182m
Outstanding commitments €98m 31 Dec 2018 (vs. €67m a year ago) will shift allocation towards private market instruments Fair value developments in 2018: Fund investments +10% Trading portfolio -3%
4 6 7 9 11 12
2 4 6 8 10 12 14 2012 2013 2014 2015 2016 2017 2018 Comparable EPS, cents DPS, cents
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Board proposal:
12 cents/share
for 2018 Based on proposal CapMan’s dividend would grow for the 6th year in a row Liquid assets >€90m Distributable earnings >€90m Equity ratio 59%
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Growth of the Management Company and Services business
Average annual growth
Equity ratio
Dividend distribution
The company’s
annually increasing dividend to its shareholders.
Return on equity
On average
Board proposal 12 cents/share Dividend per share has grown every year since 2012
Achieved 2018: 22%* Achieved 2018: 7% Achieved 2018: 59%
*Fees include management fees and service fees on group level and exclude carried interest income and items affecting comparability. Financial objectives are not including items affecting comparability.
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CapMan’s objective is to pay an annually increasing dividend to its shareholders. The combined growth objective for Management Company and Service business is more than 10 per cent p.a.
target is more than 60 per cent. CapMan expects to achieve these financial objectives gradually and key figures are expected to show fluctuation
services to continue growing in aggregate in 2019. Our objective is to improve the aggregate profitability of Management Company and Service businesses before carried interest income and any possible items affecting comparability. The return on CapMan’s investments have a substantial impact on CapMan’s overall result. The development of industries and local economies, market instrument and inflation development, valuation multiples of peer companies, exchange rates and various other factors outside of CapMan’s control, as well as the combined effect of the aforementioned factors, influence fair value development of CapMan’s overall investments in addition to portfolio company and asset-specific development. CapMan’s objective is to improve results in the longer term, taking into account annual fluctuations affecting the business. For these and other above-mentioned reasons, CapMan does not provide numeric estimates for 2019.
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Technologically advanced reporting, analysis and wealth management services and an expanded customer network
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Founded in
Employees
Turnover
Clients
Client portfolio
Investment service provider
Finnish investor focus
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Provides a consolidated and transparent view of customers’ total holdings regardless
provider or asset class Open architecture investment solutions to guarantee most effective and highest performing solutions Tailored solutions based on client needs New private asset solutions (to be developed) Unique understanding of the customer’s portfolio and needs as well as enriched data
“Wealth management with information not available to others” Analysis and visualization of all instruments and total portfolio characteristics to allow customers to make more informed investment decisions
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INVESTOR
Asset manager 1 Asset manager 2 Asset manager 3 Asset manager 4 Asset manager 5
Investor
Asset manager 1 Asset manager 2 Asset manager 3 Asset manager 4 Asset manager 5
Traditional reporting flow Consolidated reporting concept INVESTOR
Traditionally reporting services is an asset manager specific service provided to investors JAM consolidates reporting data from several sources to provide investors visibility across all asset managers and asset classes
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Consolidation Data enrichment X-Ray analytics Customized reporting X-Ray online Wealth management
Asset manager 1 Asset manager 2 Asset manager 3 Asset manager 4 Asset manager 5
Price & allocations feed 1
Price & allocations feed 2 Price & allocations feed 3
Reporting data
Other
JAM Processes Client interfaces
High degree of automation Superior quality and scalability Algorithm based methods and machine learning
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New service business with a unique value proposition Broadened customer access to tier 2 & 3 investors Notable cross selling potential
advantages
client base with some € 9 Bn of assets under administration
investors (i.e. Finnish institutional investors, foundations, family offices and wealthy private clients), many of which aim to increase their allocation to private assets
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PRIVATE EQUITY & CREDIT REAL ESTATE INFRA
Buyout funds OPEN-ENDED FUNDS CLOSED FUNDS MANDATES, CLUBS, OTHERS: INTERNATIONAL INVESTORS NORDIC TIER I INVESTORS NORDIC TIER II & III INVESTORS
SERVICES
Own balance sheet Broad access to capital New & flexible products
Growth fund Credit funds Value added (NRE funds) Yield (NPI & Hotel funds) Mandates Infra fund Mandates Other funds
Broad offering in the private assets space Active value creation
X-RAY & REPORTING
WEALTH MANAGEMENT
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Current owners of JAM Advisors
60% of JAM shares 5.1 million CapMan shares 60% 40%
Current owners of JAM Advisors
~3%
Transaction overview Post transaction
60%
share in JAM acquired by CapMan
5.1 million
new CapMan shares paid to current
subject to 2 year lock-up arrangement
Option to acquire remaining 40%
by CapMan in 2023
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Growth of the Management Company and Services business
Average annual growth
Equity ratio
Dividend distribution
The company’s
annually increasing dividend to its shareholders.
Return on equity
On average Positive Neutral in 2019 and positive thereafter Neutral Neutral The transaction does not impact CapMan’s financial outlook for 2019 as announced on 31 January 2019
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Technologically advanced reporting, analysis and wealth management services and an expanded customer network