CapMan Group’s Interim Report for 1 January – 30 June 2012

Performance and main events during the review period:

• Group turnover totalled MEUR 13.2 (January-June 2011: MEUR 15.7).
• The Group’s operating profit was MEUR 1.9 (MEUR 9.2).
• The Management Company business recorded an operating loss of MEUR 1.7  (MEUR 0.9), while the Fund Investment business recorded an operating profit of MEUR 3.6 (MEUR 10.1).
• Profit before taxes was MEUR 2.4 (MEUR 12.0) and profit after taxes was MEUR 2.0 (MEUR 8.9).
• Profit attributable to the owners of the parent company was MEUR 2.0  (MEUR 8.7). Earnings per share were 1.0 cent (8.9 cents).
• Capital under management as of 30 June 2012 totalled MEUR 3,022.2 (30 June 2011: MEUR 3,069.8).
• Long-term bank financing was completed.
  
  

Outlook for 2012 unchanged

CapMan’s next major fundraising rounds will take place in 2012. The development of the company’s current year management fees 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 will continue to decline as a result of the various efficiency enhancement measures that have been taken. Due to our fundraising efforts, management fees will not fully cover operating expenses until the new funds currently in the process of being established reach an adequate size.

The fair value of CapMan’s fund investments developed favourably during the review period. We believe that our portfolio companies are well-positioned to continue performing well in this respect during the rest of the year, which would have a positive effect on the fair value development of our fund investments.

The Group’s overall result for 2012 will mainly depend on whether funds already generating carried interest are able to conduct new exits, whether new funds will transfer to carry, and on how the value of investments develops in funds where CapMan is a substantial investor. Due to the difficulty of forecasting these developments and their timing, CapMan will not issue guidance on its result for the full year.

CEO Lennart Simonsen:

“With prevailing market uncertainty as a backdrop, we were relatively successful in making progress with our exits, which had a positive impact on our operations. Our CapMan RE II fund sold the Stockmann department store property in Turku during the second quarter. Moreover, the CapMan Equity VII B fund transferred into carry after the review period as a result of our successful exit from the Tokmanni Group in July. Following the exit, both the CapMan Equity VII A and CapMan Equity Sweden KB funds are significantly closer to carry as well.

Our result for the first half of the year was unsatisfactory. The Management Company business recorded a loss as a result of lower management fees and a lack of carried interest income.

We continued fundraising for the Buyout X, Nordic Real Estate, and CapMan Russia II funds. Despite the challenging fundraising market, we believe that we will complete the first rounds of fundraising for all three funds during the course of this year.

We are pleased with our restructured loan arrangements as we achieved greater financial flexibility by replacing our previous bank financing facilities with a new senior loan and a long-term revolving credit facility. CapMan is committed to maintaining our role as a major investor also in our new funds, and this refinancing arrangement preserves our operational leeway.”

To read CapMan Group’s Interim Report in PDF format, please click below:
CapMan Group’s Interim Report 1 January - 30 June 2012