[PPT] - FINANCIAL RESULTS OF GK PEM FOR H1 2016 WARSAW, 18 AUGUST 2016 PowerPoint Presentation

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Venture Debt Fund July 2015

FINANCIAL RESULTS OF GK PEM FOR H1 2016

WARSAW, 18 AUGUST 2016

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Agenda

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TSR – our offer for investors
Prospects for the funds and new initiatives
Financial results H1 16
Changes in accounting policy
New investments

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D I V I D E N D 2016

PLN 14.41 per share
dividend yield of 12.8%
net profit of 98%
PLN 8.00 on 15 July

PLN 6.41 on 30 September

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We build value for our shareholders through dividend distribution and share price increase

PLN 132.75 PLN 106.30

23.8 % return rate for the PEM shareholders who acquired shares during the IPO comes from dividends

4.2 % return rate for the PEM

shareholders who acquired shares during the IPO is due to change in share price

12.2 % – return rate for WIG index in

the same period => PEM relatively better than the market average –

by 31.7 pp

TSR

19.6%

30,0%
20,0%
10,0%

0,0% 10,0% 20,0% 30,0% 40,0%

PEM PEM TSR WIG

40.0% 30.0% 20.0% 10.0% 0.0%

10.0 %
20.0 %
30.0 %

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Total value of dividends paid was PLN 159m

364 523

73 37 49

mkt cap (bez dywidend) dyw. z zysku 2013

dyw. z zysku 2014
dyw. z zysku 2015

łączna wartość

159

Data in PLN million

mkt cap (without dividends)

div. from 2013 profit div. from 2014 profit
div. from 2015 profit

total value

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Agenda

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TSR – our offer for investors
Prospects for the funds and new initiatives
Financial results H1 16
Changes in accounting policy
New investments

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MCI.EuroVentures – history likes to repeat itself

Amount invested PLN 270m Valuation + div. PLN 711m CoC 2.5-4x

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Average maturity 4.3 years Amount invested PLN 330m

3-5 years

Share of the new investments in the current structure of the MCI.EuroVentures fund is nearly 40%
ATM, Dotpay, eCard, Lifebrain – investments with a high growth potential and a high likelihood of re-occurrence of

historical returns

The fund’s historical track record is the return rate of 2.5 to 4.0x CoC; on average within 4 years =>> 25% IRR

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This is the company that earned us 46% IRR for investors

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MCI.TechVentures – the fund with ‘rising stars’

Conclusion of the sales process since 2011 since 2015 since 2012 since 2015 since 2015 since 2015

Strong regional leaders Companies with a potential for rapid growth at European level Events that may contribute to further increase in the business value of the companies involved in digital economy

IPO and stock exchange valuation

Allegro UBER

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We are launching new investment products to reconstruct the PEM revenue structure to achieve a larger share of a fixed management fee

Region: PL and the Baltic countries
Up to 5m, A-B round
In contrast to Western Europe, the target area suffers from

a noticeable lack of investment capital for technology companies that would normally be provided by investment funds with long-term track-record in building regional market leaders

Fintech Fund Baltic Fund

The fund dedicated to companies from the fintech sector
Rapid development of the fintech sector in the field of

digital economy

PEM staff has extensive experience in the field of fintech

and banking plus cooperation with other funds

Up to EUR 10m, A-B round
Region: Europa
The fund investing in the mix of certificates:

MCI.TechVentures, MCI.EuroVentures and MCI.CreditVentures

Underlying instruments: mezzanine/venture debt,

private equity in growth and buyout models

Geographical location: PL, UK, DACH, Turkey, Russia
Business models: e-commerce, fintech, big data, IoT,

distribution, TMT

Fund of Funds MCI.CreditVentures

Extending the equity financing offer to include mezzanine

debt financing for technology and growth companies (venture debt)

Faster and easier process, lack of excessive dilution,

improved balance sheet structure

Up to EUR 10m
Region: PL and CEE

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Agenda

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TSR – our offer for investors
Prospects for the funds and new initiatives
Financial results H1 16
Changes in accounting policy
New investments

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Profit from cash transactions in H1’16 amounted to approx. PLN 10m

In H’16, PEM reported revenues of PLN 22.9m. This represents 40% of the revenue recorded for H1’15 due to the lack
f a variable fee
A fixed management fee, due to higher assets under management, increased by 13% to PLN 20.8m; with a

profitability ratio of 2.3% relative to the net asset value generating this fee

PLN'000 1H'16 1H'15 % zmiany 1Q'16 1Q'15 % zmiany

Opł. stała za zarządzanie 20 778 18 354

13%

9 936 8 548

16%

Opł. zmienna za zarządzanie 1 775 38 772

(95)%

472 16 664

(97)%

Pozostałe przychody 378 429

(12)%

170 183

(7)%

Przychody Razem 22 931 57 555

(60)%

10 578 25 395

(58)%

Koszty działalności podstawowej (4 889) (3 437)

42%

(2 247) (1 199)

87%

Koszty operacyjne (10 375) (20 880)

(50)%

(3 153) (6 401)

(51)%

Koszty finansowe netto (2 488) (1 401)

78%

(850) (374)

127%

Koszty Razem (17 752) (25 718)

(31)%

(6 250) (7 974)

(22)%

Podatki 1 359 2 237

(39)%

578 (52)

n/a

Zysk netto 6 538 34 074

(81)%

4 906 17 369

(72)%

Zysk netto na akcję 1,96 zł 10,22 zł

(81)%

1,47 zł 5,21 zł

(72)% % Zysk netto / Przychody z zarządzania 29,0% 59,6%

n/a

47,1% 68,9%

n/a

% Koszty sprzedaży / Przychody z zarządzania 21,7% 6,0%

n/a

21,6% 4,8%

n/a

WAN łącznie 2 158 888 1 861 452 16% 2 176 835 1 714 741 27% WAN generujący przychody 1 924 540 1 707 332 13% 1 956 088 1 544 751 27%

% Przychody / WAN gen. przychody 2,3% p.a. 6,7% p.a.

n/a

2,1% p.a. 6,5% p.a.

n/a

% Koszty / WAN gen. przychody

1,8% p.a.
3,0% p.a.

n/a

1,3% p.a.
2,1% p.a.

n/a

% Zysk netto / WAN gen. przychody 0,7% p.a. 4,0% p.a.

n/a

1,0% p.a. 4,5% p.a.

n/a

PLN’000

Fixed management fee Variable management fee Other revenues Total revenues Costs of core activities Operating costs Net financial costs

Total costs

Taxes Net profit Net profit per share % Net profit / Management revenues % Cost of sales / Management revenues Total NAV NAV generating revenues % Revenues / NAV gen. revenues % Costs / NAV gen. revenues % Net profit / NAV gen. revenues

H1 16 H1 15 % change Q1 16 Q1 15 % change 2.3% p.a.

1.8% p.a.

0.7% p.a. 6.7% p.a.

3.0% p.a.

4.0% p.a. 2.1% p.a.

1.3% p.a.

1.0% p.a. 6.5% p.a. 2.1% p.a. 4.5% p.a.

n/a n/a n/a n/a n/a n/a n/a n/a n/a n/a

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1 001 1 119 161 62 12

13% YoY increase in assets generating the management fee

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The value of assets subject to a fixed fee in H1 increased by 13% YoY, gross assets – by 19% YoY due to organic growth and

fund inflows, which in H1 16 amounted to more than PLN 138m gross and PLN 85m net (~ an increase of PLN 55m gross compared to H1 15)

The assets subject to a fixed fee increased by PLN 217m YoY. A very positive trend YoY was recorded for TV (+21%) and EV

(+10%) funds. After the end of the first quarter, the CV investor redeemed PLN 30m worth of excess liquidity

At the end of H1 16, NAV stood at PLN 2,159m, up 16% YoY
The funds managed by GK PEM have invested more than 275m YTD, of which more than 80% was invested by the

MCI.EuroVentures fund which is in the process of building an asset structure based on the private equity model

16%

increase in NAV (basis for fees) YTD above PLN 138m gross certificates sold

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PLN 2,342m

gross assets under management

Assets under management

(PLN million)

1

+13% Net Asset Value (NAV) – basis for calculating a fixed fee

(PLN million)

1

43% 47%

3%

7%

754 765 782 863 833 728 748 844 835 880 178 182 184 178 149

47 84 81 80 62

1 707 1 779 1 891 1 956 1 925

2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 Buyout (EV) Growth (TV) Credit (CV) Early Stage (IV + HVP)

Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Buyout (EV) Growth (TV) Credit (CV) Early Stage (IV + HVP)

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11% growth rate for a quarterly fixed management fee

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A fixed management fee of PLN 21m in H1 16
A small variable management fee in H1 16. Given the capital market situation, relatively good performance achieved by

EV and TV funds in H1 16 was not sufficient to exceed the hurdle rate of 10% p.a. In the period from 27 May 2015, which is the date when we last collected variable fees in EV and TV Funds, to 30 June 2016 the hurdle rate stood at 11 %

All funds that we manage have significantly better growth rates than the Warsaw WIG index, which dropped by ~16 %

YoY Revenues from a fixed management fee

(PLN million)

1

Return rates for the funds

Net

1

Revenues from a variable fee

(PLN million)

1

+11% 3,9 3,9 4,0 3,8 4,4 4,9 5,6 6,1 5,3 5,6

0,3 0,4 0,5 0,4 0,4 0,8

0,2

0,4 0,4 0,4

9,8 9,8 11,0 9,9 10,8

2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 Buyout (EV) Growth (TV) Credit (CV) Early Stage (IV + HVP)

11,0 10,9

0,3 1,7 0,3 0,7

22,1 0,0 1,8 0,5 1,3

2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 Buyout (EV) Growth (TV) Credit (CV)

1H'16 LTM MCI.TV 4,8%

8,8%

MCI.EV 4,5%

5,1%

MCI.CV 2,8%

6,7%

d momentu ostatniego zmiennego

MCI.EV

2,1%

MCI.TV

9,0%

Buyout (EV)

Growth (TV)

Credit (CV)

Early Stage (IV + HVP) Q2 15 Q3 15

Q3 15 Q2 15

Q4 15

Q1 16

Q2 16

H1 16 LTM

MCI.TV MCI.EV MCI.CV MCI.EV MCI.TV

since the last variable

9.8 9.8 11.0 9.9 10.8 4.9 5.6 6.1 5.3 5.6 4.0 3.9 3.9 3.8 4.4

0.2

0.3 0.8 0.4 0.4 0.4 0.4 0.4 0.4 0.5

2.1% 9.0% 5.1% 6.7% 8.8%

4.8% 4.5% 2.8%

22.1

0.3

10.9 11.0 0.0 1.8 0.5 1.3

1.7 0.3 0.7

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Assets valued at market price and 40% share of the cost of investment (price at which the asset was bought) made it difficult to obtain the rate in excess of the minimum rate of return

MCI.EuroVentures

1

MCI.TechVentures

1

NAV 27.05.15 NAV 27.05.15

NAV 27.05.15 issues management fees 2.1% rate of return NAV Q2 16 needed to reach the variable NAV Q2 16 Sym NAV Q2 16 Sym needed to reach the variable NAV Q2 16 9.0% rate of return management fees issues NAV 27.05.15

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44 12 9 10 29 35 31 18 24 15

2Q'15 3Q'15 4Q'15 1Q'16 2Q'16 Środki Pieniężne Naliczone Opłaty za Zarządzanie

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We had PLN 44m in cash at the end of H1 16

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At the end of H1 16, PEM had PLN 29m in cash, which, combined with the management fees charged (PLN 15m),

amounted to a total of PLN 44m, i.e. PLN 13.2 per share

Net cash to EBITDA LTM ratio was 1.29x

PLN 21m

net cash

1.29x

net cash/ EBITDA LTM

PLN 22m

available revolving credit dividend payment of PLN 36.8m

Cash item

(PLN million)

1

PLN'000 H1'16

Środki Pieniężne i Ekwiwalenty 29 Naliczone Opłaty za Zarządzanie 15 Razem

44

Kredyty i pożyczki Wyemitowane Obligacje 23 Gotówka netto

21

payment of the 1st dividend tranche of PLN 28.6m

PLN’000 H1 16

Cash and cash equivalents Management fees charged Loans Bonds issued

Total Net cash

Q2 15 Q3 15 Q4 15 Q1 16 Q2 16 Cash Management fees charged

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Agenda

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TSR – our offer for investors
Prospects for the funds and new initiatives
Financial results H1 16
Changes in accounting policy
New investments

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Changes in accounting policy

Purpose of the change:

ensuring that the cost of variable remuneration is more stable over time (reducing the number of one-off events) – ensuring

that costs are more proportionate to revenues

increasing the relevance and transparency of financial statements by improving the comparability of data over specific

reporting periods

increasing the comparability of data in financial statements of other companies engaged in similar activities
reducing the uncertainty as to the future performance of PEM in this area
systematic identification of costs related to the creation of provisions for each investment, regardless of the share in the

portfolio of funds, as the value of investments over lifetime increases

The changes introduced:

provisions were created for each investment included in the portfolios of the funds managed by GK PEM
changing the starting point for identifying the event that creates an obligation to recognise a provision – provisions should

be recognised, if a notional net profit is generated at the level of an individual investment (as the fair value of the investment increases)

the provision is recognised at 5% of the notional net profit, where the net profit is defined as the difference between

revenues from the investments recognised as revenues generated from the sale of stocks/shares (partial exits), dividends received and other benefits of a similar nature and the fair value measurement of the investment and the expenditures incurred recognised as the capital invested to purchase the investment, including any recapitalisation of the company, as well as all additional costs associated with the acquisition of the investment and those associated with the maintenance, management and administration of the investment, plus the expected return on investment per annum (hurdle rate)

changing the starting point for recognising a provision, i.e. inclusion of a portfolio company in the calculation upon the first

measurement of the investment at fair value.

Rezerwy Zobowiązania Zmiana stanu rezerw do P&L Zmiana stanu zobowiązań do P&L Było w P&L w 2015 Wpływ na wynik Wpływ na kapitały YE2012 6 605

6 605

YE2013 16 260

9 655

YE2014 21 099

4 839

YE2015 24 910

3 811
3 449
362

1H2016 17 974 10 014 6 936

10 014
3 078

TOTAL

3 125
10 014
3 449
3 440
21 099

SPRAWOZDANIE Z SYTUACJI FINANSOWEJ SPRAWOZDANIE Z ZYSKÓW LUB STRAT EFEKT ZMIAN

Okres

Period Provisions Liabilities Change in provisions for P&L Change in liabilities for P&L P&L in 2015 Impact on the result Impact on equity TOTAL 2012 2013 2014 2015 H1 2016

STATEMENT OF FINANCIAL POSITION STATEMENT OF PROFIT OR LOSS EFFECT OF CHANGES

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Agenda

p

TSR – our offer for investors
Prospects for the funds and new initiatives
Financial results H1 16
Changes in accounting policy
New investments

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The funds that we manage have invested more than PLN 275m YTD

New investments and subsequent financing rounds prior to the publication of the report

1

FinTech Online factoring platform Online solutions Streaming of multimedia content Data centres Market leader for data centres with an extensive fibre-optic infrastructure SaaS Professional support for PR departments and communication between companies FinTech Mobile banking and online payments E-commerce Multi-store FinTech Non-cash settlements of payment transactions FinTech Currency transfers

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MarketInvoice – new company from the fintech sector in the portfolio of funds managed by PEM

MarketInvoice manages an online factoring platform. The round of financing led by MCI.TechVentures amounted to GBP 7.2m

The investment strengthens the position of the funds managed by PEManagers in the fintech sector,
The financing round was also joined by the Northzone fund,
The company currently operates only in the UK market, but plans to expand geographically,
Within the platform, the British companies have so far received funding of GBP 850m; the company assumes that

by the end of 2016 the amount will exceed GBP 1bn.

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The funds managed by GK PEM are one of the most active technology investors in CEE

CEE POLAND RUSSIA TURKEY DACH GLOBAL

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Statement

This presentation has been prepared by PEM S.A. with due diligence, though it may still contain some inaccuracies or

missions. This presentation cannot be regarded as a comprehensive financial analysis of the PEM S.A. Capital Group, nor

does it provide a complete view of its position and future prospects. Any person who intends to make an investment decision regarding the shares of PEM S.A. should first consider the information disclosed in the official reports drawn up and published in accordance with applicable law. This presentation has been prepared for information purposes only and does not constitute an offer to buy or sell any financial instruments. This presentation may contain forward-looking statements, which cannot, however, be treated as projections of future performance by the PEM S.A. Capital Group. Statements regarding future and historical financial results do not guarantee that such results will be achieved in the future. The projections of the Management Board of PEM S.A. are based on the currently available knowledge and depend on a number of factors and variables that could cause the actual results to differ materially from those expressed in this document. Under no circumstances shall PEM S.A., management board members and directors be held liable for any use of this

presentation. None of the information contained in this presentation represents a commitment or representation on the part
f PEM S.A., management board members or directors. PEM S.A. has no obligation to publish corrections or update the

forward-looking statements contained in this presentation to reflect changes occurring after the date of this presentation.