Earnings from Fund Investment Services unchanged – net asset value and net income lower
The war in Ukraine, high inflation rates, interest rate hikes by central banks and an increasingly pessimistic economic outlook have triggered significant price losses on equity markets. Following intensified negative capital markets fluctuations over recent weeks, Deutsche Beteiligungs AG (“DBAG”) once again adjusted its forecast for the financial year 2021/2022. This will be explained in detail in the Quarterly Statement as at 30 June 2022, which is scheduled for publication on 12 August 2022.
The valuation of DBAG’s portfolio is a key driver for net income: “Changes in capital market multiples for peer-group companies have had a clearly negative impact on gross gains and losses on measurement and disposal for the first nine months of the financial year 2021/2022 (ending on 30 June 2022)", the ad-hoc disclosure published on 15 July states. According to the release, based on preliminary figures, net asset value of Private Equity Investments at the end of the first nine months of the financial year stood at approximately 600 million euros; preliminary net income for the period amounted to approximately -78 million euros. Both figures have significantly deteriorated compared to the same period of the previous financial year.
Based on these insights, DBAG has issued a new forecast,according to which net asset value of Private Equity Investments as at 30 September 2022 is expected in a range between 570 and 630 million euros. DBAG’s Board of Management continues to expect earnings from Fund Investment Services in a range of 14 to 16 million euros (unchanged from the previous projection).
The factors influencing net asset value, as described above, tend to have the same impact on net income, which is expected in a range between -70 and -85 million euros for the full year. The forecast range published in April 2022 was between -15 and -25 million euros.
The current forecast is based on valuations as at 30 June 2022; valuation levels at the end of the financial year on 30 September 2022 may be higher or lower.