We have become familiar with it by now: online formats are having to replace face-to-face meetings for the present. Hence this year's Capital Markets Day was held on 8 September for analysts, fund managers and other investor representatives via video conference. CEO Torsten Grede and CFO Susanne Zeidler, together with two of DBAG's managing directors, Tom Alzin and Jannick Hunecke, gave a detailed insight into DBAG's current business development through an online presentation. Initial information from DBAG's new medium-term planning, which covers the financial years 2020/2021 to 2022/2023, was also presented.
“Partner of choice” for company founders, family entrepreneurs and management teams
CEO Grede and CFO Zeidler used the new company presentation to emphasise DBAG's very strong market position: As a forerunner in the German private equity market, with 65 management buyouts and long-term investments alone over the past 20 years, DBAG has gained an excellent reputation, especially among shareholders of family businesses and company founders. DBAG's exchange listing and the transparency it provides sets it apart from most of its competitors. It is these two quality seals that make DBAG the preferred investment partner for German mid-sized companies.
Four MBOs in six weeks
The Company's most recent transactions are further evidence of DBAG's very strong market position. CEO Grede emphasised DBAG's strong performance despite the current challenging conditions: during July and August, four new MBOs were agreed within six weeks. In addition to this, one stake was sold in full to a strategic buyer and another was sold in part via a share placement. “Never before have we been able to handle so many transactions in such a short time – this speaks volumes about how efficient our processes are,” explained Grede to more than 30 attendees participating in the Capital Markets Day.
Investment team expanded
In addition to consistently optimising its processes over the past few years, DBAG has also expanded its investment team over recent months with the arrival of five new colleagues. The more experienced among the team’s now 26 members have been involved in private equity for an average of 18 years, mostly at Deutsche Beteiligungs AG. They are required to support DBAG's investment decisions and personally co-invest alongside DBAG funds. Such co-investments currently amount to around 20 million euros.
CEO Grede sees the extensive experience of the Management Board and investment teams as a crucial pillar for the Company's long-term investment success: “No matter how hard you work, there is no substitute for experience.” This is why DBAG supports its employees with targeted human resources development, encouraging them to stay with the Company for a long time – an excellent way of gaining experience in the M&A market.
Net asset value and net income from Fund Investment Services expected to rise more strongly than recently
Chief Financial Officer Susanne Zeidler provided information on key elements of the Company's new medium-term planning, which covers the coming financial year 2020/2021 and the two subsequent periods. DBAG's objective is to increase its net asset value by an average of 14 to 16 per cent for each of these three years. Over the past five financial years, the annual average increase has been 13.5 per cent. Net asset value, which is expected between 405 and 425 million euros as at 30 September 2020, is projected to rise to 565 to 595 million euros, even after taking into account proposed distributions over the next three years.
DBAG also plans to generate stronger growth than recently in its second segment, Fund Investment Services. As a result of significantly higher income from Fund Investment Services – triggered by the recent launch of DBAG Fund VIII – net income from Fund Investment Services is expected to rise from eight to nine million euros in the current 2019/2020 financial year to ten to eleven million euros in 2022/2023; this represents average annual growth of between eight and eleven per cent. Over the past five years, this figure has risen by eight per cent year-on-year.
Questions raised by attendees included possible future disposals and expansion of the investment team. A recording of the Capital Markets Day can be downloaded from the website.