Price sensitive ("ad hoc") releases
Partners Group reports 2011 results impacted by foreign exchange developments and will propose an increased dividend of CHF 5.50 per share based on the solid development of the business
Baar-Zug, 13 March 2012
- Strong client demand resulted in assets under management (AuM) inflows of EUR 4.2 billion in 2011; Partners Group reconfirms the anticipated EUR 4-5 billion in inflows for 2012.
- The firm's results were impacted by the foreign exchange developments due to the average EUR/CHF and USD/CHF rates decreasing by 11% and 15%, respectively.
- In addition, certain non-recurring revenues, after being high in 2010, were at significantly lower levels in 2011 while being expected to increase again in 2012.
- As a consequence, net revenues at CHF 346 million were 8% lower than in the previous year (2010: CHF 376 million) despite the AuM inflows.
- EBITDA was also impacted and amounted to CHF 212 million (2010: CHF 250 million) with the lower EBITDA margin of 61% largely the result of currency developments.
- Adjusted net profit for 2011 was CHF 212 million (2010: CHF 302 million). Apart from the impacts mentioned above, the decrease is also a result of a significantly lower financial result of only CHF 26 million (2010: CHF 78 million).
- Based on the further growth in its business and the solid operating result, Partners Group's board of directors intends to propose an increased dividend of CHF 5.50 per share (2010: CHF 5.00 per share) to shareholders, which represents a dividend yield of 3.4% (as of closing share price on 31 December 2011).
Partners Group, the global private markets manager, saw new client demand of EUR 4.2 billion in 2011, a further sign of trust in an environment which remains challenging and closed the year with total AuM of EUR 24.8 billion. The firm reconfirms its outlook for 2012 and expects to see demand from clients of EUR 4-5 billion for the year.
Despite the growth in the firm's business, its results were however impacted by the foreign exchange environment. The new revenues generated by the increased AuM were almost completely offset by currency developments, with the average EUR/CHF and USD/CHF rates weakening by 11% and 15%, respectively. In addition, non-recurring revenues, after being high in 2010, were at significantly lower levels in 2011, while being expected to increase again in 2012. In 2010, a large number of the firm's open programs had been launched in 2009, thus generating a high level of late management fees while the opposite was true for 2011 due to a large number of new product launches in Q2 2011. As a result, overall revenues decreased by 8% to CHF 346 million (2010: CHF 376 million) despite the significant client commitments during the year.
While the weakening of the euro had an impact on the firm's revenues, its impact on costs was lower as a large portion of the firm's operating costs are incurred in a number of local currencies due to the firm's global setup, with a large portion in Swiss francs. The average foreign exchange appreciation of the Swiss franc thus directly resulted in EBITDA decreasing by 15% to CHF 212 million (2010: CHF 250 million) and the EBITDA margin, in parallel, standing at 61% for 2011 (2010: 66%). Partners Group continues to place a strong emphasis on disciplined cost management and new recurring costs have remained proportional to assets raised and in line with previous practice. The firm increased headcount by 127 to 574 employees at the end of 2011 and expects to see continued growth of its team in 2012 alongside the development of its business.
Adjusted net profit amounted to CHF 212 million (2010: CHF 302 million), impacted further by a significantly lower financial result of only CHF 26 million (2010: CHF 78 million). Partners Group's investment programs showed a positive performance in 2011, with net gains of CHF 19 million. In addition, net interest income on the liquidity position of CHF 310 million on the firm's balance sheet, which includes loans to Partners Group products, contributed a further CHF 9 million to the financial result. Finally, extraordinary foreign exchange losses of CHF 3 million stand in contrast to a gain of CHF 32 million in 2010. Net of the extraordinary effects described above, the adjusted net profit would have increased broadly in line with the 17% growth in private markets AuM.
After having seen further growth in its business followed by a solid operating result considering the environment and based on its strong balance sheet, Partners Group's board of directors intends to propose an increased dividend of CHF 5.50 per share (2010: CHF 5.00 per share) to shareholders at the annual general meeting on 3 May 2012. The proposal represents a dividend yield of 3.4% as of the share price on 31 December 2011.
Partners Group is pleased to have its standing in the industry confirmed by the Private Equity International and Private Equity Real Estate Awards 2011, two of the most prestigious in the private markets industry. Partners Group is honored to have been recognized as a clear industry leader by winning a number of awards, including:
- European Private Equity Direct Investor of the Year
- Top three Asian Private Equity Direct Investor of the Year
- European Mezzanine Firm of the Year
- Top three Asian Mezzanine Firm of the Year
- European Private Real Estate Secondaries Firm of the Year.
Steffen Meister, Chief Executive Officer, comments, "We will continue to focus on building out our investment platform across all sectors and regions in order to seize opportunities arising from both the changed environment as well as from the firm's expansion. We will also work on further increasing our proximity to clients and on strengthening our relationships with them while enhancing our product offering to better meet the needs of our global and highly sophisticated clientele. We are additionally committed to further developing our global operations setup to increase support for both our investment and client activities while also fulfilling the requirements of the evolving regulatory environment as well as having the scope to meet new operational challenges."
Alfred Gantner, Executive Chairman, adds, "Following the balance sheet problems across the entire financial and sovereign community, market participants will be forced to deleverage and, as we first anticipated in 2009, the long-term economic growth path has experienced a structural shift and resumed its path at a lower level. With bond yields at current low levels, volatile public markets and rising inflation expectations, traditional avenues for investing capital will no longer provide institutional investors such as pension funds with the returns they need to fulfill their obligations and we believe a fundamental shift of allocation focus is in order. We therefore expect that investors will turn to private markets even more and are convinced that, in the current economic scenario of a stagnating advanced world, value must be created at the individual asset level."
Partners Group's senior management will hold a press conference to discuss the 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 annual report 2011 was published today at 7.00 am CET and is available for download at www.partnersgroup.com/financialreports.
(in CHF m)
Recurring net revenues
Adjusted net profit1
1 Adjusted for certain non-cash items relating to our capital-protected product Pearl
Key dates 2012
3 May 2012
Annual general meeting
7 May 2012
9 May 2012
Dividend record date
10 May 2012
Dividend payment date
12 July 2012
Announcement of AuM as of 30 June 2012
4 September 2012
Announcement of semi-annual results as of 30 June 2012