Tue, 11/03/2008 - 06:00
Swiss-based Partners Group, which manages nearly CHF25bn in hedge funds, private equity, real estate and other alternative strategies, has announced record financial results for 2007, including gains of more than 40 per cent in assets under management and growth of more than 50 per cent in revenues and profits.
Partners Group says the results, including a surge in assets of CHF7.1bn to CHF24.4bn, reflects the continued successful development of the business. Net revenues last year totalled CHF311m, an increase of 55 per cent from CHF210m in 2006, with 88 per cent of revenues coming from management fees (CHF273m). Additional income was generated through performance fees (CHF27m) and organisational fees (CHF11m).
Operating costs rose at a slower pace by 45 per cent to CHF79m, predominantly attributable to an increase in the number of employees triggered by the firm's asset growth. This resulted in earnings before interest, tax, depreciation and amortisation growing by 58 per cent from CHF147m to CHF232m, achieving a record Ebitda margin of 74 per cent for the year.
Adjusted net profit totalled CHF228m, up 61 per cent from CHF141m in 2006. Under IFRS rules the firm's profit was CHF255m, up 65 per cent from CHF154m the previous year, including an additional CHF28m stemming from changes in fair value of derivatives arising from insurance contracts.
At the company's annual general meeting on April 11, Partners Group will propose a distribution of 50 per cent of adjusted net profit to shareholders, corresponding to a dividend of CHF4.25 per share.
'We are satisfied with how we are weathering the financial market storm,' says partner and chief executive Steffen Meister. 'In 2008, we expect solid asset inflows into our private market products, while further net redemptions are anticipated in our smaller public market business. However, we still aim to be within reach of CHF30bn in assets under management by year-end, a realistic but ambitious target in this challenging market environment.'
Dr. Marcel Erni, a partner and the firm's chief investment officer, adds: 'We are convinced that the current market situation offers excellent investment opportunities in many private market segments, and the second half of 2007 marked a record period in terms of our investment volume.
'The current credit market crisis undoubtedly shut down investments at the larger end of the buyout spectrum. However, this is more than compensated by a substantial increase in secondary market opportunities and significantly improved terms in the mezzanine market as well as attractive valuations in special situations and listed private equity. We are confident that we are currently making highly attractive investments with significant return potential for clients.'
Partners Group manages a broad range of funds, structured products and customised portfolios with private equity, private debt, private real estate, listed alternative investments, hedge funds and alternative beta strategies for an international clientele of institutional investors, private banks and distribution partners.
The firm, which employs more than 270 people at its headquarters in Zug and offices in London, Guernsey, New York, San Francisco, Singapore and Tokyo, is listed on the SWX Swiss Exchange with a market capitalisation of around CHF4bn, and is majority owned by its 38 partners and principals as well as employees.
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