Price sensitive ("ad hoc") releases
Baar-Zug, 10 September 2013
- Client demand of EUR 2.2 billion in H1 2013 with expected range of EUR 4-6 billion confirmed for the full year 2013
- Recurring revenues increased to CHF 195 million (H1 2012: CHF 173 million) in line with average assets under management development
- Revenues increased to CHF 222 million (H1 2012: CHF 213 million)
- EBITDA increased with revenues to CHF 135 million (H1 2012: CHF 130 million), EBITDA margin remained stable at 61% (H1 2012: 61%) in line with ~60% target
- With a financial result of CHF 16 million (H1 2012: CHF 12 million), adjusted net profit was up 7% to CHF 134 million (H1 2012: CHF 125 million)
Partners Group's client demand during the first half of the year was spread across all asset classes and investment strategies and driven by both the firm's track record as well as by the firm's breadth of investment platform and service capabilities. During this period, Partners Group saw demand for its products and mandates of EUR 2.2 billion from existing as well as new institutional investors around the world, predominantly from private and public pension schemes. About a third of the client demand in the first half stems from core European countries, namely Switzerland, Germany, France and Benelux. Roughly a third was contributed by North America and the UK while the remaining third was driven by the Asia-Pacific region, in which the Middle East and Australia dominated. The driver for client commitments remains the same: in an environment characterized by limited growth expectations, higher volatility and low interest rates, larger investors focus on global private markets solutions and are willing to forgo a certain amount of liquidity in order to benefit from more attractive returns. The firm confirms the communicated expected range of EUR 4-6 billion in new client commitments for the full year 2013. Net AuM growth will likely experience negative effects of an expected EUR -1.0 to -1.5 billion in 2013.
Average AuM in CHF increased by 12% in H1 2013 compared to H1 2012. Recurring revenues (88% of all revenues during this period) stemming from management fees increased accordingly, rising 13% to CHF 195 million (H1 2012: CHF 173 million). Non-recurring revenues (12% of all revenues during this period) were generated from performance fees and late management fees & other non-recurring income. Performance fees in H1 2013 amounted to CHF 13 million (H1 2012: CHF 20 million) and the firm expects these to be skewed to the second half of the year. Late management fees & other non-recurring income in general result from the initiation of new or closings of existing investment programs and amounted to CHF 14 million (H1 2012: CHF 19 million). Some of the firm's long duration investment programs experienced longer than expected regulatory approval processes, resulting in a postponement of their initial launches. Older open programs of the firm are expected to pay late management & other non-recurring fees during the second half of the year, resulting in the overall late management fees & other non-recurring income also being skewed to H2 2013.
Overall, the firm saw revenues increase to CHF 222 million in H1 2013 (H1 2012: CHF 213 million). Partners Group's recurring revenue margin remained stable in the period at 1.12% (H1 2012: 1.12%). After a strong year 2012 driven by a robust exit environment, the overall revenue margin decreased to 1.27% (H1 2012: 1.37%), typical for a year with a lower level of performance fees, while late management & other non-recurring fees were also lower than in H1 2012.
Partners Group continues to stick to a disciplined cost management. In H1 2013, despite the increasing complexity of the business due to the implementation of additional regulatory requirements, this discipline resulted in a stable EBITDA margin of 61% (H1 2012: 61%) in line with the target of ~60%. EBITDA amounted to CHF 135 million in H1 2013 (H1 2012: CHF 130 million) and was in line with revenue development.
Partners Group's net financial result in H1 2013 amounted to CHF 16 million (H1 2012: CHF 12 million). As a result, the adjusted net profit for H1 2013 followed the positive revenue and EBITDA development and grew by 7% to CHF 134 million (H1 2012: CHF 125 million).
In the course of H2 2013, Partners Group expects to sell the remaining interests in two affiliated companies to the respective management teams. This step is consistent with the firm's strategy to further focus on private markets investment activities. As of 30 June 2013, affiliated companies comprised a total of about EUR 0.8 billion in assets which represented 3% of Partners Group's total assets under management. These public market assets are managed at significantly lower margins than the private markets business.
André Frei, Partner and Co-Chief Executive Officer, comments: “Global pension markets, our dominant client sector, continue to grow. On the hunt for yield in the current low-growth environment, many investors are increasing their allocations towards alternate sources of return and we expect private markets assets to play an ever-more important role. We are convinced that investing through a global private markets investment platform offers access to attractive returns and our track record, global footprint, state-of-the-art client and investment services as well as structuring solutions meet the current regulatory challenges while helping our clients navigate the turbulent waters of today's investment environment.”
Alfred Gantner, Co-founder and Executive Chairman, concludes: “In a low-growth, low-yield and highly competitive environment, our focus lies clearly on active value creation within our portfolios and we are dedicated to initiating and managing this across the entire value chain. With each of our portfolio investments displaying its own value creation drivers and characteristics, the broad know-how and expertise of our global industry value creation team allows us to identify and implement the most advantageous strategy for each of these investments to drive future performance. Furthermore, our activities within our private infrastructure practice fill a widening financing gap for dearly required infrastructure renewal and build-out while offering a highly attractive risk-adjusted yield enhancement above sovereign debt.”
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 2013 was published today at 7.00 am CET and is available for download at www.partnersgroup.com/financialreports.
(in CHF m)
Adjusted net profit3
1 Restated to reflect the application of new reporting standards
2 Revenues from management and advisory services, net, including other operating income and share of results of associates
3 Adjusted for certain non-cash items relating to our capital-protected product Pearl
Key dates 2014
15 January 2014
Announcement of AuM as of 31 December 2013
25 March 2014
Annual results & annual report 2013
15 May 2014
Annual general meeting
17 July 2014
Announcement of AuM as of 30 June 2014
9 September 2014
Interim results & interim report as of 30 June 2014