Frank\u00adfurt am Main \u2014 Deut\u00adsche Betei\u00adli\u00adgungs AG (DBAG) intends to conti\u00adnue growing: The net asset value of private equity invest\u00adments is expec\u00adted to increase by an average of between 14 percent and 19 percent in the current and the two follo\u00adwing finan\u00adcial years, while earnings from fund advi\u00adsory services are expec\u00adted to reach a double-digit million euro amount in each case. This is accor\u00adding to the listed private equity company\u2019s medium-term plan\u00adning published today with the Group\u2019s 2019\/2020 annual finan\u00adcial report.<\/p>\n
The basis for this growth is signi\u00adfi\u00adcantly higher invest\u00adments by DBAG along\u00adside the funds it advi\u00adses, as well as invest\u00adments finan\u00adced exclu\u00adsi\u00advely from DBAG\u2019s balance sheet: While an average of around 72 million euros has flowed into invest\u00adments in mid-market compa\u00adnies over the past five years, around 120 million euros are plan\u00adned annu\u00adally until 2023. \u201cIf nothing else, the Covid 19 pande\u00admic is opening up invest\u00adment oppor\u00adtu\u00adni\u00adties that we intend to target,\u201d said DBAG CEO Tors\u00adten Grede, adding, \u201cWe have expan\u00added our plat\u00adform for equity solu\u00adti\u00adons in the midmar\u00adket and inves\u00adted in our invest\u00adment team.\u201d<\/p>\n
Net asset value of private equity invest\u00adments impac\u00adted by pande\u00admic in 2019\/2020<\/strong> Due to the special nature of its private equity busi\u00adness, DBAG does not manage its busi\u00adness using tradi\u00adtio\u00adnal annual perfor\u00admance indi\u00adca\u00adtors such as EBIT or return on sales. Instead, the key perfor\u00admance indi\u00adca\u00adtors are the varia\u00adbles that DBAG can influence and that deter\u00admine the value of the two busi\u00adness areas of private equity invest\u00adments and fund advi\u00adsory services \u2014 the net asset value of private equity invest\u00adments and the result of fund advi\u00adsory services. Accor\u00addin\u00adgly, conso\u00adli\u00adda\u00adted net profit is not a key perfor\u00admance indi\u00adca\u00adtor; it amounts to \u201116.8 million euros, driven by the Key figu\u00adres (IFRS) 2019\/2020 2018\/2019 Fund consul\u00adtancy bene\u00adfits from the launch of the new DBAG fund<\/strong> The fund had been closed in May with a volume of 1.109 billion euros. As a result, the assets advi\u00adsed and mana\u00adged by DBAG, which form the basis for measu\u00adring income from the fund busi\u00adness, rose to around \u20ac2.6 billion (Septem\u00adber 30, 2019: \u20ac1.7 billion).<\/p>\n Divi\u00addend propo\u00adsal: 0.80 euros per share Invest\u00adment decis\u00adi\u00adons trig\u00adge\u00adred for 314 million euros<\/strong> 96.8 million of the invest\u00adment decis\u00adi\u00adons were finan\u00adced by DBAG from its own balance sheet. This included \u20ac5.2 million for seven port\u00adfo\u00adlio compa\u00adnies that were hit harder than average by the Corona pande\u00admic; the addi\u00adtio\u00adnal equity was used to support debt finan\u00adcing solu\u00adti\u00adons to improve the finan\u00adcial resour\u00adces of these companies.<\/p>\n Equity ratio remains very high at 89 percent<\/strong> \u201cStra\u00adte\u00adgic inte\u00adrest in mature holdings\u201d Due to the econo\u00admic weak\u00adness that has persis\u00adted in parts of the indus\u00adtry for some time, dispo\u00adsals have recently been delayed. The DBAG port\u00adfo\u00adlio conta\u00adins a number of compa\u00adnies that have been supported for a longer period of time; change proces\u00adses that were initia\u00adted at the start of the invest\u00adment are well advan\u00adced. \u201cWe are expe\u00adri\u00aden\u00adcing inte\u00adrest from stra\u00adte\u00adgic inves\u00adtors in such invest\u00adments,\u201d CFO Zeid\u00adler said today. And further: \u201cHowe\u00adver, should dispo\u00adsals and corre\u00adspon\u00adding returns be further delayed, the addi\u00adtio\u00adnal credit line gives us flexi\u00adbi\u00adlity to take advan\u00adtage of attrac\u00adtive invest\u00adment oppor\u00adtu\u00adni\u00adties at any time \u2014 in addi\u00adtion, we are exami\u00adning other finan\u00adcing opti\u00adons, for exam\u00adple on the equity side.\u201d<\/p>\n About DBAG<\/strong> Frank\u00adfurt am Main \u2014 Deut\u00adsche Betei\u00adli\u00adgungs AG (DBAG) intends to conti\u00adnue growing: The net asset value of private equity invest\u00adments is expec\u00adted to increase by an average of between 14 percent and 19 percent in the current and the two follo\u00adwing finan\u00adcial years, while earnings from fund advi\u00adsory services are expec\u00adted to reach a double-digit [\u2026]<\/p>\n","protected":false},"author":2,"featured_media":36326,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"wp_typography_post_enhancements_disabled":false,"footnotes":""},"categories":[886,1364,1365,1366,1369],"tags":[],"class_list":["post-43547","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general-en","category-featured-en","category-private-equity-en","category-news-en","category-investors","news-category-private-equity-news-en"],"yoast_head":"\n
\nAccor\u00adding to the plan\u00adning, DBAG\u2019s growth will acce\u00adle\u00adrate: Between 2014 and 2019, the net asset value of private equity invest\u00adments had increased by around 13 percent annu\u00adally. It is expec\u00adted to grow by up to 19 percent per year until 2023. The growth would also more than offset the setback expe\u00adri\u00aden\u00adced in net asset value due to the impact of the pande\u00admic on port\u00adfo\u00adlio compa\u00adnies in fiscal year 2019\/2020 (Oct. 1\u2011Sept. 30). At 422.0 million euros, adjus\u00adted for the effect of the distri\u00adbu\u00adtion to share\u00adhol\u00adders, it fell 5.8 percent short of the previous year\u2019s figure, but reached the upper end of the fore\u00adcast revi\u00adsed after the Corona shock in the spring. In parti\u00adcu\u00adlar, share\u00adhol\u00addings with a strong link to indus\u00adtry suffe\u00adred in some cases heavy losses in reve\u00adnues and earnings and did not achieve their origi\u00adnal budgets; this resul\u00adted in corre\u00adspon\u00adding impairm\u00adents of these share\u00adhol\u00addings. Once again, invest\u00adments in broad\u00adband tele\u00adcom\u00admu\u00adni\u00adca\u00adti\u00adons or soft\u00adware compa\u00adnies, which are bene\u00adfiting from the acce\u00adle\u00adra\u00adted digi\u00adtiza\u00adtion in many areas of life and busi\u00adness models, deve\u00adlo\u00adped encouragingly.<\/p>\n
\nPerfor\u00admance of private equity invest\u00adments. This segment closed 2019\/2020 with earnings before taxes of \u201125.2 million euros, down 67.3 million euros on the previous fiscal year.<\/p>\n
\nSegment result Private Equity Invest\u00adments -\u20ac25.2 million \u20ac42.1 million
\nSegment result Fund Consul\u00adting \u20ac9.5 million \u20ac3.0 million
\nNet asset value \u20ac 422.0 million \u20ac 472.1 million
\nNet result -\u20ac16.8 million \u20ac45.9 million
\nDivi\u00addend (2019\/2020: propo\u00adsed) \u20ac0.80 \u20ac1.50<\/p>\n
\nEarnings in the second segment, fund advi\u00adsory services, excee\u00added expec\u00adta\u00adti\u00adons: at 9.5 million euros, they reached their highest level since the intro\u00adduc\u00adtion of segment report\u00ading in 2013\/2014. The basis for the signi\u00adfi\u00adcant increase compared with the previous year (\u20ac3.0 million) is higher income from the fund busi\u00adness and lower provi\u00adsi\u00adons for varia\u00adble compen\u00adsa\u00adtion \u2014 this prima\u00adrily reflects the perfor\u00admance of the port\u00adfo\u00adlio. Income was signi\u00adfi\u00adcantly higher (\u20ac30.6 million after \u20ac28.2 million) because DBAG has also been recei\u00adving income for advi\u00adsing DBAG Fund VIII since its launch in August 2020.<\/p>\n
\nThe divi\u00addend propo\u00adsal for the past finan\u00adcial year \u2014 0.80 euros per share \u2014 does not imply any change in DBAG\u2019s divi\u00addend policy. \u201cIt prima\u00adrily takes into account the expec\u00adted later returns from the port\u00adfo\u00adlio as a result of longer holding peri\u00adods for our indus\u00adtrial holdings,\u201d said CFO Susanne Zeid\u00adler, explai\u00adning the propo\u00adsal. He added: \u201cWe expect that as the econo\u00admic envi\u00adron\u00adment norma\u00adli\u00adzes after the pande\u00admic subs\u00adi\u00addes, we will be able to return to our policy of stable and, when\u00adever possi\u00adble, rising divi\u00addends next year with a divi\u00addend of between 1.00 and 1.20 euros per share.\u201d The divi\u00addend propo\u00adsal corre\u00adsponds to a yield of 2.4 percent based on the average price of DBAG shares for the year.<\/p>\n
\nDBAG\u2019s invest\u00adment team has trig\u00adge\u00adred invest\u00adment decis\u00adi\u00adons of 314 million euros in 2019\/2020. Three of these invol\u00adved manage\u00adment buyouts (MBOs) struc\u00adtu\u00adred for the new fund within the first two months of its invest\u00adment period. In addi\u00adtion, there was another MBO with DBAG Fund VII and a first long-term invest\u00adment \u2014 a mino\u00adrity stake in a fast-growing company, finan\u00adced exclu\u00adsi\u00advely from DBAG funds. Six port\u00adfo\u00adlio compa\u00adnies grew stron\u00adgly through a total of 14 corpo\u00adrate acqui\u00adsi\u00adti\u00adons; these acqui\u00adsi\u00adti\u00adons, mainly finan\u00adced by the port\u00adfo\u00adlio compa\u00adnies them\u00adsel\u00adves, serve to acce\u00adle\u00adrate the imple\u00admen\u00adta\u00adtion of the stra\u00adte\u00adgic deve\u00adlo\u00adp\u00adment of the port\u00adfo\u00adlio companies.<\/p>\n
\nDBAG has a solid balance sheet with an equity ratio of around 89 percent. Cash and cash equi\u00adva\u00adlents decreased shar\u00adply compared with the previous year as a result of the high level of capi\u00adtal expen\u00addit\u00adure. Once again, these signi\u00adfi\u00adcantly exceed the reco\u00adveries from the port\u00adfo\u00adlio. With the conclu\u00adsion of a further credit line, DBAG increased its finan\u00adcial room for maneu\u00adver by 40 million euros. In 2019\/2020, DBAG was able to add six invest\u00adments to its port\u00adfo\u00adlio, inclu\u00adding the MBOs of Carton\u00adplast and the DING Group, which had alre\u00adady been agreed in 2018\/2019. One company left the port\u00adfo\u00adlio; this dispo\u00adsal had also been agreed in the previous year. The two (partial) dispo\u00adsals agreed in 2019\/2020 will not take effect until the new fiscal year. As of Septem\u00adber 30, the port\u00adfo\u00adlio consis\u00adted of 32 invest\u00adments in compa\u00adnies of the (predo\u00admi\u00adnantly) German Mittelstand.<\/p>\n
\nThe DBAG Manage\u00adment Board is confi\u00addent for the new, current 2019\/2020 finan\u00adcial year and beyond. \u201cOur posi\u00adtion in the market is good, we can have about one billion of capi\u00adtal ready to invest and invest in new invest\u00adments,\u201d the report conti\u00adnues. In view of the ongo\u00ading pande\u00admic, DBAG intends to place parti\u00adcu\u00adlarly high demands on the quality of the busi\u00adness model, its stra\u00adte\u00adgic importance and the growth of the respec\u00adtive market when asses\u00adsing invest\u00adment oppor\u00adtu\u00adni\u00adties. \u201cInvest\u00adments from the IT services and soft\u00adware and broad\u00adband tele\u00adcom\u00admu\u00adni\u00adca\u00adti\u00adons sectors are the main candi\u00adda\u00adtes for this, but also Indus\u00adtry\u00adTech compa\u00adnies,\u201d says board spokes\u00adman Grede, \u201cfor exam\u00adple, manu\u00adfac\u00adtu\u00adr\u00aders of such indus\u00adtrial compon\u00adents whose products make auto\u00adma\u00adtion, robo\u00adtics and digi\u00adtiza\u00adtion possi\u00adble in the first place.\u201d In addi\u00adtion, DBAG intends to address invest\u00adment oppor\u00adtu\u00adni\u00adties in compa\u00adnies in special situa\u00adtions, i.e. those with perfor\u00admance-rela\u00adted equity requirements.<\/p>\n
\nDeut\u00adsche Betei\u00adli\u00adgungs AG, a listed company, initia\u00adtes closed-end private equity funds and invests \u2014 predo\u00admi\u00adnantly along\u00adside DBAG funds \u2014 in well-posi\u00adtio\u00adned medium-sized compa\u00adnies with poten\u00adtial. DBAG focu\u00adses on indus\u00adtrial sectors in which German SMEs are strong by inter\u00adna\u00adtio\u00adnal stan\u00addards. An incre\u00adasing propor\u00adtion of equity invest\u00adments are in compa\u00adnies in new growth sectors such as broad\u00adband tele\u00adcom\u00admu\u00adni\u00adca\u00adti\u00adons, IT services\/software and health\u00adcare. The long-term, value-enhan\u00adcing entre\u00adpre\u00adneu\u00adrial invest\u00adment approach makes DBAG a sought-after invest\u00adment part\u00adner in the German-spea\u00adking region. Capi\u00adtal mana\u00adged and advi\u00adsed by the DBAG Group amounts to 2.6 billion euros<\/p>\n","protected":false},"excerpt":{"rendered":"