Baar-Zug, Switzerland, 9 September 2014
Partners Group reports strong financial figures for H1 2014
Highlights H1 2014
- Total of EUR 2.9 billion client demand received in H1 2014; total assets under management (AuM) stood at EUR 33.8 billion as of 30 June 2014 (31 December 2013: EUR 31.6 billion) representing an annualized growth rate of 15%
- Total of USD 4.2 billion invested across all private markets asset classes in H1 2014; of which USD 1.9 billion was invested in direct transactions and USD 1.8 billion in secondary transactions
- Expansion of the firm’s global reach with the opening of offices in Mumbai, India, and Houston, Texas, US, increasing the total number of offices to 18
- Strong financial performance generated with increases across all key financials: revenues, EBITDA and adjusted net profit
- Stable EBITDA margin of 62% (H1 2013: 61%)
(in CHF m)
Adjusted net profit3
IFRS net profit
1Revenues from management and advisory services, net, including other operating income and share of results of associates
2Management fees include recurring management fees, late management fees and other non-recurring income
3Adjusted for certain non-cash items relating to the capital-protected investment program Pearl Holding Limited
Business development and market environment
During the first six months of 2014, Partners Group further strengthened its position as one of the leading global private markets investment managers with a total of USD 4.2 billion invested in private equity, private real estate, private infrastructure and private debt investments around the globe. To further expand the firm's investment platform in markets and segments of opportunity, the company opened its 17th and 18th offices in Mumbai, India, and Houston, Texas, US, respectively. In parallel, the firm reported gross client demand of EUR 2.9 billion from its global clientele across all private markets asset classes in H1 2014. As of 30 June 2014, Partners Group counted more than 700 employees and over 600 institutional investors, with EUR 33.8 billion in AuM across all private market asset classes.
The current market environment is reflected by below trend global growth and increased price levels, driven by strong financial market performance, but not supported by fundamentals. In such an environment, selectivity remains the key priority for Partners Group in order to ensure the quality of investments made on behalf of its clients. The ability to remain selective even in a heated market environment depends on robust deal flow, which the firm can assure through its global sourcing platform, in which over 480 investment professionals are actively involved. In H1 2014, the firm screened close to 1'700 direct opportunities and close to USD 60 billion in secondary opportunities and declined 97% of them.
Summary of financial figures
Overall revenues of Partners Group increased by 29% to CHF 287 million in H1 2014 (H1 2013: CHF 222 million). Revenues stemming mainly from management fees amounted to CHF 274 million (H1 2013: CHF 209 million) and represented 96% of the overall revenues during the period, rising 31% year-on-year.
Performance fees accounted for the remaining CHF 12 million in H1 2014 (H1 2013: CHF 13 million) and represented 4% of the overall revenues. With the increasing maturity of a greater number of client portfolios, performance fees are likely to show a disproportionate ramp-up in the coming years and Partners Group expects the proportion of performance fees in the medium term to grow to up to 20% of total revenues.
Partners Group continues to place an emphasis on disciplined cost management, with new recurring costs remaining proportional to assets raised. In H1 2014, the EBITDA margin remained stable at 62% (H1 2013: 61%) and EBITDA increased by 31% in line with revenues and amounted to a record CHF 178 million (H1 2013: CHF 135 million). The firm reconfirms its target EBITDA margin of ~60% to allow for further growth of the investment platform.
In H1 2014, strong value creation and performance generation stemming from Partners Group's investments in its programs alongside its clients led to a financial result of CHF 17 million (H1 2013: CHF 16 million).
The IFRS net profit increased by 23% in H1 2014 to CHF 193 million (H1 2013: CHF 156 million) and the adjusted net profit increased by 27% to CHF 169 million (H1 2013: CHF 134 million).
Based on the current client demand pipeline and a strong first half, the firm reconfirms its expectation of gross client demand of EUR 4.5-6.5 billion for the full year 2014. Partners Group expects an unchanged amount of EUR -1.5 billion of tail-downs (2013: EUR -0.6 billion) and EUR -0.3 to -1.0 billion of potential redemptions from liquid and semi-liquid activities (2013: EUR -0.6 billion) for the full year 2014.
Comments from the Co-CEO and Chairman
André Frei, Partner and Co-Chief Executive Officer, comments: “We greatly appreciate that clients have continued to demonstrate their trust in Partners Group's investment management and operational capabilities. We see continued consolidation of the investment managers in our market, with institutional investors increasingly gravitating towards those firms with an established global brand, multi-asset class investment capabilities and strategic portfolio solutions. Partners Group is a beneficiary of this trend with 16% compound annual growth rate in our AuM since 2007 and with USD 4.2 billion invested in the first half of this year.”
Peter Wuffli, Chairman of the Board of Directors, adds: "As the opening of our Mumbai and Houston offices earlier this year shows, we are actively working to further expand our reach and our depth in global private markets. Talented people around the globe are integral to the success of our model and we are proud of the diverse and entrepreneurial culture we have built at Partners Group. Our strong first-half results are a testament to the strength of our team and of our global platform."
Press conference and interim report H1 2014
Partners Group’s senior management will hold a press conference to discuss the semi-annual results today at 9.00 am CET at the SIX ConventionPoint in Zurich. Dial-in details for the conference can be obtained using the contact details below.
The interim report as of 30 June 2014 was published today at 7.00 am CET and is available for download at www.partnersgroup.com/financialreports.
Key dates 2015
14 January 2015
Announcement of AuM as of 31 December 2014
24 March 2015
Annual results & annual report 2014
13 May 2015
Annual general meeting
16 July 2015
Announcement of AuM as of 30 June 2015
8 September 2015
Interim results & interim report as of 30 June 2015