SVG Capital IMS Q3. 25 October 2013

Transcription

1 SVG Capital IMS Q3 25 October 2013

2 Highlights IMS Q3 Continued strong momentum; YTD % NAV per share growth 2 NAV of 497.2p +3.5% in Q3 4.6% total return on the investment portfolio in Q3; total return of 24.4% YTD Predominantly driven by quoted portfolio, in particular Hugo Boss and ProSiebenSat 62.2% of the gross investment portfolio valued on a quoted basis Falls to 57.7% post the recapitalisation of Red & Black (holding company for Hugo Boss) and sale of Marazzi Gains partially off-set by negative foreign exchange movements in the period (- 27.8m or-11.6p per share) The portfolio is dominated by Permira IV investments (83.0% of gross investment portfolio on a look through basis) The Permira IV portfolio companies continue to report good revenue and earnings growth supported by diversified global revenue streams and management growth initiatives Distributions outweigh calls Disciplined capital allocation 38.7m of distributions in Q m since period end taking total YTD distributions to 219.5m 7.3m of calls paid in Q3 Largely to fund new investment by the Fifth Cinven Fund (Host Europe) and a secondary purchase of a position in SVG Diamond III Significant deleveraging, allowing more flexibility to return capital 1 Senior Notes repaid; allowing SVG Capital to return up to 20% of Total Assets to shareholders in any one 365 period 25.4m of capital returned in the quarter; 126.8m YTD Taking total capital returned to shareholders since December 2011 to 228.7m or 49% of 470m target 1. It is expected that these returns of capital will be in the form of buy-backs, regular tender offers and dividends and will be dependent on the size and timing of distributions from the existing investment portfolio and the requirement of SVG Capital to comply with the constraints of its senior borrowings; relevant taxation and other legislation; the Company s overall priority of maintaining a prudent level of debt and in subsequent years, the renewal of relevant shareholder authorities. The pricing of any tenders will be with reference to net asset value at the time of the tender

3 Balance sheet Significant liquidity and coverage 3 Balance sheet Pro-forma Oct 13 m Sept 13 m Jun 13 m Investment portfolio 1 1,112 1,207 1,183 Cash Other assets Total assets 1,315 1,304 1,460 Bank Facility Senior Notes - - (158) Convertible Bonds (94) (94) (94) Other liabilities (5) (6) (14) Shareholders funds 1,216 1,204 1,194 NAV per share 507p 497p 480p m Uncalled commitment coverage (pro-forma 25 October) 360m 1.5x coverage from cash and credit facility 239m Net (cash)/debt % of Shareholders funds (4%) 4% 3% Gross debt as a % of total assets 7% 7% 17% LTV ratio (maximum 30%) 4 0% 0% 13% 0 Liquidity Uncalled commitments Cash Credit facility Uncalled commitments 1. Adjusted for movements in quoted share prices, cash-flows since 30 September and foreign exchange movements to 23 October Approximate at 25 October 2013 and including the 115.6m distribution from the recapitalisation of Red & Black (investment holding company of Hugo Boss) the realisation of Marazzi and share buy-backs 3. Total facility of 250m 4. Flexibility for covenants to go up to 40% for one three month period

4 Investment portfolio Investment portfolio focused on Permira IV assets 4 Top Five holdings Dominated by Permira IV investments (83.0% of investment portfolio on a look through basis) Good sales and EBITDA growth from the portfolio, supported by diversified global revenue streams and management growth initiatives Small exposure to Permira Europe III companies (8.9% of gross investment portfolio on a look through basis) Some investments have a material exposure to Southern Europe and continue to be impacted by consumer confidence and lower spending levels Transparency High visibility on performance of the underlying companies Maturing portfolio Anticipated to continue to return significant distributions over the next months 1 Company 30 Sept 2013 valuation Change over Q3 % of gross investment portfolio % of total assets 23 Oct 13 Pro-forma 2 Hugo Boss 411m + 34m 37% 31% 304m Arysta 210m - 5m 19% 16% 210m ProSiebenSat 150m + 18m 14% 11% 168m Iglo Group 64m - 1m 6% 5% 65m Freescale 62m + 8m 6% 5% 60m TOTAL 82% 69% 1. Subject to market conditions 2. Adjusted for realisations and movements in quoted share prices and foreign exchange since 30 September 2013

5 Outlook Committed to generating long-term shareholder value 5 High quality portfolio, performing well Focus on driving both shorter and longer term returns for shareholders Short to medium term NAV growth will be driven by the existing portfolio, largely Permira IV Permira IV investments continue to report good earnings and revenue growth supported by strong management teams and growth initiatives Adjusted NAV at 23 October 2013 of 506.5p Mainly driven by positive movements in foreign exchange New investments - good pipeline of potential investment opportunities Europe Several high quality European managers expected to be fundraising in the next months Disciplined approach to new deal pricing is key Pricing is still relatively high especially for high quality assets High percentage of secondary deals and receptive credit markets US Largest private equity market in the world, well known to us Strong short-term pipeline of potential US managers Stronger economy and fiscal issues largely resolved Long term prospects/returns remain attractive, short term pricing being inflated by buoyant credit markets Total shareholder return 25.4m capital returned in the quarter 228.7m returned since December average price of 335p 49% of the target of 470m 1 1. It is expected that returns of capital will be in the form of buy-backs, regular tender offers and dividends and will be dependent on the size and timing of distributions from the existing investment portfolio and the requirement of SVG Capital to comply with the constraints of its senior borrowings; relevant taxation and other legislation; the Company s overall priority of maintaining a prudent level of debt and in subsequent years, the renewal of relevant shareholder authorities. The pricing of any tenders will be with reference to net asset value at the time of the tender

6 Supplementary information

7 Supplementary information 4.6% total return from net investment portfolio MBO portfolio (83.6% of the investment portfolio) Acquisition Sector Geographic focus Valuation basis % of total assets Q3 change (gross) 30 Sept 13 Value 7 Hugo Boss May 07 Retail Global Quoted 31.5% m 410.7m Arysta LifeScience Feb 08 Chemicals Global Earnings 16.1% - 4.8m 209.6m ProSiebenSat Mar 07 Media Cont. Europe Quoted 11.5% m 149.6m iglo Group Nov 06 Consumer Cont. Europe/UK Earnings 4.9% - 1.3m 63.8m Freescale Nov 06 Elec/comms Global Quoted 4.7% + 8.2m 61.7m Legico Jan 08 Financial Global Mark-to-market 2.5% + 1.4m 33.2m Acromas (AA Saga) Sep 04 Consumer UK Earnings 1.6% + 0.9m 20.5m Marazzi (Mohawk) Jul 08 Retail Global Quoted 1.3% + 1.1m 16.4m New Look Apr 04 Retail Cont. Europe/UK Earnings 1.1% + 4.0m 14.0m Just Retirement Sep 09 Financial UK Earnings 0.7% - 0.1m 8.9m ASVG portfolio (13.3% of investment portfolio) Funds % of total assets Q3 change (net) 30 Sept 13 value ASVG global diversified FOF (SVG Diamond I-III and SPEFOF III) 12.3% - 0.3m m 1. Including a 2.3m secondary purchase in SVG Diamond III

8 Supplementary information Uncalled commitments at 30 September Uncalled commitments Amount called Amount uncalled Uncalled commitment 1 Management buyout funds Permira IV 1,374.6m 69.8m 58.3m Sapphire IV 1.7m 0.3m 0.3m SVG Sapphire IV 11.3m 1.7m 1.4m Cinven Fifth Fund 20.5m 79.5m 66.4m Permira V m 83.6m 210.0m Aberdeen SVG Private Equity funds SVG Diamond Private Equity III 51.5m 20.0m 16.7m Schroder Private Equity Fund of Funds III 0.9m 0.1m 0.1m 16.8m Non-core portfolio Total 7.8m 234.6m 1. Based on foreign exchange rates at 30 September 2013

9 Supplementary information Management buyout funds portfolio analysis at 30 September Valuation 1 % 1 Quoted/MTM Earnings 34 3 Cost 2 4 Written down earnings Sector 1 % 1 Retail 41 2 Chemicals 20 3 Media Consumer 9 5 Electronics and communications Geography 1 % 1 Global 71 2 Cont. Europe Financial 4 7 Leisure 1 8 Industrial products/services 1 9 Medical Health UK 8 4 North America 2 1. By value at 30 September 2013

10 Supplementary information Underlying companies - vintage year analysis at 30 September m & before Cost Earnings Quoted Third Party Written Down 1. Year of original investment in underlying company

11 Supplementary information Performance and premium/(discount) to NAV 11 (p) 1,000 FTSE All Share (rebased) SVG NAV (Par) FTSE All Share Total Return % discount to NAV Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 Oct-13 Source: Datastream, 22 October 2013

12 Important information 12 The information in this presentation is issued by SVG Capital plc ("SVG Capital"), whose registered office is at 1 Bread Street, London, EC4M 9HH. SVG Capital is registered in England: No The information contained in this presentation is not intended to make any offer, inducement, invitation or commitment to purchase, subscribe to, provide or sell any securities, service or product or to provide any recommendations for financial, securities, investment or other advice or to take any decision. You should seek individual advice from your personal, financial, legal and other advisers before making any investment or financial decisions or purchasing any financial, securities or investment related service or product. The information contained in this presentation is provided for general information and is not comprehensive and has not been prepared for any other purpose. Any financial, securities or investment related service or product referred to may not be available to all customers or in all cases; may be available only where specifically requested and agreed upon; may be associated with certain specific fees and conditions and may be materially different than as described. This presentation contains certain forward-looking statements with respect to the portfolio of investments of SVG Capital. These statements and forecasts involve risk and uncertainty because they relate to events and depend upon circumstances that may or may not occur in the future. There are a number of factors that could cause actual results or developments to differ materially from those expressed or implied by these forwardlooking statements and forecasts. Nothing in this presentation should be construed as a profit forecast.

13 Risk considerations 13 You should remember that the value of investments, and the income from them, may go down as well as up, and is not guaranteed, and investors may not get back the amount of money invested. Past performance cannot be relied on as a guide to future performance. Exchange rate changes may cause the value of overseas investments or investments denominated in different currencies to rise or fall. In addition, there is no guarantee that the market price of shares will fully reflect their underlying net asset value and it is not uncommon for the market price of such shares to trade at a substantial discount to their net asset value. These are not all the risks of an investment in SVG Capital shares. Investors should take advice from their own independent, professional financial advisers before making an investment decision and are responsible for ascertaining any income tax or other tax consequences which may affect their acquisition of any investment. For further information please contact: Alice Kain Head of Communications and Investor Relations Aberdeen SVG Private Equity Advisers Limited Bow Bells House 1 Bread Street London EC4M 9HH Tel: