CapMan Plc 1–6 2021 Half-Year Report

August 5, 2021

CapMan Plc Stock Exchange Release / 1–6 2021 Half-Year Report
5 August 2021 at 8:00 a.m. EEST

CapMan Plc 1–6 2021 Half-Year Report

Results and significant events in January–June 2021:

  • Group turnover was MEUR 23.2 1 Jan–30 Jun 2021 (MEUR 20.7) and increased by 12 per cent.
  • Operating profit was MEUR 21.5 (MEUR -1.8).
  • Management Company business turnover was MEUR 18.9 (MEUR 15.0). Operating profit was MEUR 4.9 (MEUR 3.5).*)
  • Service business turnover was MEUR 4.2 (MEUR 5.6). Operating profit was MEUR 1.9 (MEUR 3.3).*)
  • Investment business operating profit was MEUR 17.3 (MEUR -5.7).
  • Diluted earnings per share were 10.2 cents (-3.2 cents).
  • Capital under management EUR 4.3 billion on 30.6.2021 and increased by EUR 1.2 billion, or 37 per cent from 30.6.2020.

This stock exchange release is a summary of CapMan Plc’s 1 January–30 June 2021 Half-Year Report. The complete report is available in pdf-format as an attachment to this release and on the company’s website at https://www.capman.com/shareholders/financial-reports/.

*) The comparison period figures have been restated following changes to the composition of reporting segments starting from 1 January 2021.

CEO comment:

”Efforts over recent years into growth and improved value creation brought CapMan’s half-year 2021 results to record levels. The second quarter of the year continued the positive trend of preceding quarters and the reported result for January–June 2021 was the strongest in more than ten years. Operating profit exceeded MEUR 21 and earnings per share 10 cents.

Our assets under management continued growing and reached a new record level of EUR 4.3 billion at the end of June 2021. The increase was EUR 1.2 billion, or 37 per cent from June last year. Growth in the second quarter was mainly due to commitments to our Residential, Special Situations and Credit funds. We expect to see continued strong growth in asset under management in the upcoming 12 months due to ongoing fundraising projects and CapMan’s expanding product portfolio.

Recent demand for our funds has been strong especially among blue-chip international investors. At the end of June, approx. 60 per cent of our assets under management come from outside the Nordic countries. The increased diversification and internationalization of our investor base provides an excellent foundation for future growth, and we believe that most of the future growth in assets under management will come from outside the Nordic markets.

Management Company turnover was MEUR 18.9 in the first half of the year, growing 26 per cent from the comparison period. Turnover grew due to new assets under management. The operating profit of the Management Company business was MEUR 4.9, growing by approx. 40 per cent from the comparison period due to both strong fee growth and good cost control.

The remaining Service business turnover was MEUR 4.2 and operating profit MEUR 1.9 in the first half of 2021. The Service business includes CapMan’s procurement service CaPS and reporting and analytics service JAY Solutions. Both business areas demonstrated strong development during the first half of 2021. CaPS’s turnover continued growing and the business was very profitable. The growth in turnover of JAY Solutions was significant.

The fair value changes of our investments were MEUR +17.8 in the first half of 2021. The positive development is broad-based and includes all our active strategies. In the comparison period, fair values decreased significantly due to the market disruption brought on by the Covid-19 pandemic.

Following successful value creation work, many of our funds hold significant carried interest potential and ongoing exit processes in many funds will, when successfully completed, realise this potential. The second quarter of the year was active in terms of transactions, and we expect this trend to continue short to mid-term. Our balance sheet and liquidity have strengthened further. At the end of June, our equity ratio was 48 per cent and liquid assets were MEUR 52. CapMan’s objective is to pay an annually increasing dividend to our shareholders and recent result development and growth expectations support this objective. The 2021 Annual General Meeting decided to distribute 14 cents/share to shareholders as dividend and equity repayment. The distribution is to be implemented semi-annually. The first instalment was paid in March and the second instalment will be paid in September in accordance with the decision of the AGM.”

Joakim Frimodig  
CEO, CapMan Plc

Key figures

MEUR 1-6/21 1-6/20
Operating profit (loss) 21.5 -1.8
Result for the period 16.6 -4.3
Earnings per share, cents 10.4 -3.2
Earnings per share, diluted, cents 10.2 -3.2
% 30.6.21 30.6.20
Return on equity, % 29.9 -7.5
Equity ratio, % 47.5 50.3

Financial objectives

CapMan’s objective is to pay an annually increasing dividend to its shareholders.

The combined growth objective for the Management Company and Service businesses is more than 10 per cent p.a. on average. The objective for return on equity is more than 20 per cent p.a. on average. CapMan’s equity ratio target is more than 60 per cent.

CapMan maintains outlook estimate for 2021

CapMan expects to achieve these financial objectives gradually and key figures are expected to show fluctuation on an annual basis considering the nature of the business. CapMan estimates capital under management to continue growing in 2021. Our objective is to improve the aggregate profitability of Management Company and Service businesses. These estimations do not include possible items affecting comparability.

Carried interest income from funds managed by CapMan and the return on CapMan’s investments have a substantial impact on CapMan’s overall result. In addition to portfolio company and asset-specific development and exits from portfolio companies and assets, various factors outside of the portfolio’s and CapMan’s control influence fair value development of CapMan’s overall investments as well as the magnitude and timing of carried interest.

CapMan’s objective is to improve results in the longer term, taking into consideration annual fluctuations related to the nature of the business. For these and other above-mentioned reasons, CapMan does not provide numeric estimates for 2021.

Items affecting comparability are described in the Tables section of this report.

Result webcast today at 9.30 a.m. EEST

CapMan’s management will present the result for the review period in a webcast to be held at 9.30 a.m. EEST. Please access the webcast at https://capman.videosync.fi/2021-08-05-q2/register. The conference will be held in English. A replay of the webcast will be available on the company’s website after the event. Due to the ongoing Covid-19 pandemic, CapMan will not arrange an in-person conference.

Helsinki, 5 August 2021

CAPMAN PLC
Board of Directors

Further information:
Niko Haavisto, CFO, CapMan Plc, tel. +358 50 465 4125

Distribution:
Nasdaq Helsinki Ltd
Principal media
www.capman.com

Appendix: CapMan Plc 1-6 2021 Half-Year Report

About CapMan

CapMan is a leading Nordic private asset expert with an active approach to value creation. We offer a wide selection of investment products and services. As one of the Nordic private equity pioneers, we have developed hundreds of companies and real estate assets and created substantial value in these businesses and assets over the past 30 years. With more than €4 billion in assets under management, our objective is to provide attractive returns and innovative solutions to investors. We have a broad presence in the unlisted market through our local and specialised teams. Our investment strategies cover Private Equity, Real Estate and Infra. We also have a growing service business that includes procurement services, wealth management, and analysis, reporting and back office services. Altogether, CapMan employs around 150 people in Helsinki, Stockholm, Copenhagen, Oslo, London and Luxembourg. We are a public company listed on Nasdaq Helsinki since 2001 and a signatory of the UN Principles for Responsible Investment (PRI) since 2012. Read more at www.capman.com.