CapMan Oyj : 1-3 2021 Interim Report

CAPMAN PLC 1-3 2021 INTERIM REPORT	TILINPÄÄTÖSTIEDOTE	TAULUKOT

Interim Report

1-3 | 2021

Strong result development continues - operating profit exceeded MEUR 10

CapMan Plc 29 April 2021

CAPMAN PLC 1-3 2021 INTERIM REPORT

REPORT TEXT l TABLES

CapMan Plc 1-3 2021 Interim Report

Strong result development continues - operating profit exceeded MEUR 10

Results and significant events in January-March 2021

• Group turnover was MEUR 11.3 1 Jan-31 Mar 2021 (MEUR 11.9
  1 Jan-31 Mar 2020), a decrease of 5 per cent from the comparison period.
• Operating profit was MEUR 10.1 (MEUR -6.0).
• Management Company business turnover was MEUR 9.0 (MEUR 7.9). Operating profit was MEUR 2.5 (MEUR 1.9).*)
• Service business turnover was MEUR 2.3 (MEUR 4.1). Operating profit was MEUR 1.2 (MEUR 2.9).*)
• Investment business operating profit was MEUR 7.9 (MEUR -8.4).
• Diluted earnings per share were 4.7 cents (-5.3 cents).
• Capital under management was EUR 3.9 billion on 31.3.2021 (EUR 3.2 billion).
• The first instalment (7 cents/share) of a total of 14 cents/share, to be distributed for 2020, was paid to shareholders in March. The second instalment is to be paid around September.

TURNOVER 1-3 2021 OPERATING PROFIT 1-3 2021

€11.3m €10.1m

ASSETS UNDER MANAGEMENT	RETURN ON EQUITY (ROE)
31.3.2021	1-3 2021
€3.9 bn	29.2% p.a.

*) The comparison period figures have been restated following changes to the composition of reporting segments starting from 1 January 2021.

1 l CapMan Plc

CAPMAN PLC 1-3 2021 INTERIM REPORT

CEO comment:

"Efforts over recent years to grow our fee base and improve value creation of investments are reflected in the strong development over the first months of 2021. Operating profit was MEUR 10 and earnings per share 5 cents for the first quarter of the year.

Our assets under management continued growing and reached a record level of EUR 3.9 billion at the end of March, growing by approx. MEUR 700, or approx. 20 per cent, in the past year. We expect to see continued growth during 2021 due to ongoing fundraising projects and CapMan's expanding product portfolio. Simultaneously, CapMan's investor base becomes more diverse and international, providing an excellent foundation for future growth. At the end of March, approx. 50 per cent of our assets under management come from outside the Nordic countries. This percentage has grown significantly over the past three years from when the share of international fund investors was around 10 per cent.

CapMan's investor base grows more diverse and international, providing an excellent foundation for future growth. At the end of March, approx. 50 per cent of our assets under management come from outside the Nordic countries.

Management Company turnover was MEUR 9 in the first quarter of the year, growing approx. 15 per cent from the comparison period. Turnover grew due to new assets under management. The operating profit of the Management Company business was MEUR 2.5, growing by approx. 30

REPORT TEXT l TABLES

per cent from the comparison period due to both strong fee growth and cost control.

The remaining Service business turnover was MEUR 2.3 and operating profit MEUR 1.2 in the first quarter of 2021. The Service business includes CapMan's procurement service CaPS and reporting and analytics service JAY Solutions following the changed segment reporting practice. Both business areas demonstrated strong development during the first quarter of 2021. CaPS's turnover continued growing and the business was very profitable. The growth in turnover of JAY Solutions was significant.

The strong start for 2021 is a continuation of the positive result development achieved in the final quarter of last year.

The fair value changes of our investments were MEUR +8.2 in the first quarter of 2021. This reflects the accelerated positive development in our funds over the past few quarters, supported by the overall market recovery. In the comparison period, fair values decreased significantly due to the market disruption brought on by the Covid-19 pandemic.

The strong start for 2021 is a continuation of the positive result development in the final quarter of last year. Our fee base is strong and growing and the recurring income support the development of fee-based profitability. Successful value creation in our investment business is reflected in our results as positive fair value development. Following value creation work, many of our funds hold significant carried interest potential. Many funds have ongoing exit processes which, when completed, would help realise this carried interest potential.

2 l CapMan Plc

CAPMAN PLC 1-3 2021 INTERIM REPORT

Our balance sheet is strong, and our liquidity is good. At the end of the year, our equity ratio was 45 per cent and liquid assets were close to MEUR 50. CapMan's objective is to pay an annually increasing dividend to our shareholders. The 2021 Annual general Meeting decided to distribute 14 cents/share to shareholders as dividend and equity repayment. The distribution is to be implemented semi-annually and the first instalment was paid in March."

Sincerely,

Joakim Frimodig

CEO, CapMan Plc

CapMan Plc 1-3 2021 Interim Report

Group turnover and result in 1-3 2021

CapMan Group's turnover totalled MEUR 11.3 in the period spanning 1 January-31 March 2021 (1 January-31 March 2020: MEUR 11.9). The 5 per cent decrease in turnover was mainly due to lower transaction-based service fees compared to the comparison period. Recurring fees of the Management Company and Service business grew by 19 per cent in total.

Operating expenses were MEUR 9.3 (MEUR 9.5) in total. Personnel expenses, including incidentals, were MEUR 6.3 (MEUR 6.3). Depreciations and amortisations were MEUR 0.4 (MEUR 0.3). Other operating expenses amounted to MEUR 2.7 (MEUR 2.8).

Fair value changes of investments were MEUR +8.2 for January-March 2021 (MEUR -8.4). The fair value increase was pervasive across investments as almost all funds demonstrated strong development during the first quarter. The fair value increase was also supported by the general

REPORT TEXT l TABLES

market recovery. During the comparison period, fair values decreased sharply mainly following the outbreak of the global Covid-19 pandemic.

The Group's operating profit was MEUR 10.1 (MEUR -6.0).

Financial income and expenses amounted to MEUR -0.9 (MEUR -0.6). Profit before taxes was MEUR 9.3 (MEUR -6.5) and profit after taxes was MEUR 7.8 (MEUR -7.4).

Diluted earnings per share were 4.7 cents (-5.3 cents).

A quarterly breakdown of turnover and profit, together with turnover, operating profit/loss, and profit/loss by segment for the review period are available in the Tables section of this report.

Management Company business

Turnover generated by the Management Company business for the first quarter totalled MEUR 9.0 (MEUR 7.9), an increase of 15 per cent mainly due to an increase in management fees from the comparison period.

Management fees were MEUR 8.0 (MEUR 6.9), growth was 17 per cent. Several new funds, among them CapMan Growth II and CapMan Nordic Real Estate III funds, contributed favourably to management fees for the period. Of the turnover, 98 per cent was based on long term contracts (97 per cent during the comparison period).

Carried interest income for the review period totalled MEUR 0.05 (MEUR 0.1).

Other Management Company fees were MEUR 0.9 (MEUR 0.9). CapMan includes CapMan Wealth Services as part of the Management Company business segment starting from January 2021.

3 l CapMan Plc

CAPMAN PLC 1-3 2021 INTERIM REPORT

REPORT TEXT l TABLES

Operating expenses of the Management Company business amounted to MEUR 6.6 (MEUR 6.0). Operating profit of the Management Company business was MEUR 2.5 (MEUR 1.9).

Service business

Turnover generated by Service business totalled MEUR 2.3 (MEUR 4.1) and the 44 per cent decrease from the comparison period was mainly due to lower transaction-based fees.

All turnover, MEUR 2.3, was based on long-term contracts and grew by 33 per cent from turnover based on long-term contracts in the comparison period (MEUR 1.7) due to strong development of CaPS and JAY Solutions. Following an update to segment composition as of 2021, the Service business includes CaPS and JAY Solutions. The updates to segment composition are accounted for also for the comparison period. The comparison period also included a total of MEUR 2.4 in fundraising and advisory service fees from the terminated Scala Fund Advisory fundraising activities.

Operating expenses of the Service business amounted to MEUR 1.3 (MEUR 1.4). The operating profit of the Service business was MEUR 1.2 (MEUR

2.9).

Investment business

Fair value of fund investments was MEUR 129.0 on 31 March 2021 (31 March 2020: MEUR 104.8). Fair value changes of fund investments were MEUR +8.2 in Jan-Mar 2021 (MEUR -8.4), representing a 6.7 per cent increase in value (Jan-Mar 2020: -6.1 per cent). The fair value increase was pervasive across investments as almost all funds demonstrated strong development during the first quarter. The fair value increase was also supported by the general market recovery. Fair values decreased

significantly in the comparison period mainly due to the impact of the global outbreak of Covid-19.

CapMan invested a total of MEUR 11.3 in its funds in the first quarter of 2021 (MEUR 3.2). CapMan received distributions from funds totalling MEUR 6.0 (MEUR 6.7). The amount of remaining commitments that have not yet been called totalled MEUR 102.1 as at 31 March 2021 (31 March 2020: MEUR 102.1) and include commitments to the newest Buyout, Infra, Real Estate and Growth funds, among others. Capital calls, distributions and remaining commitments are detailed in the Tables section of this report.

The fair value of other long-term investments was MEUR 0.2 and remained unchanged during the review period. In the comparison period, the fair value change of other long-term investments was MEUR -1.3.

The fair value of CapMan's remaining market portfolio was MEUR 0.3 on 31 March 2021 (31 March 2020: MEUR 1.5) and consisted mainly of listed stocks.

In total, change in fair value of investments was MEUR +8.2 in Jan-Mar 2021 (Jan-Mar 2020: MEUR -8.4). Operating profit for the Investment business was MEUR 7.9 (MEUR -8.4).

Table 1: CapMan's investments booked at fair value as at 31 March 2021

		Fair value 31 March 2021 (MEUR)
Fund investments		129.0
Other long-term		0.2
investments
Market portfolio	0.3
Total	129.5

4 l CapMan Plc