CapMan Oyj : 1-3 2024 Interim Report

Growth in assets under management and good profitability

CapMan Oyj | 02.05.2024

CAPMAN PLC 1-3 2024 INTERIM REPORT

CEO | REPORT TEXT | TABLES

CapMan Plc 1-3 2024 Interim Report

Results and significant events 1-3 2024

• Assets under management EUR 5.7 billion 31.3.2024 (EUR 5.0 billion 31.12.2023).
• Group turnover was MEUR 18.4 1 January-31 March 2024 (MEUR 15.1 1 January-31 March 2023).
• Fee income was MEUR 14.9 (MEUR 15.1).
• Carried interest was MEUR 3.5 (MEUR -0.0).
• Operating profit was MEUR 7.3 (MEUR 0.5). Comparable operating profit was MEUR 8.6 (MEUR 0.5).
• Fee profit was MEUR 2.7 (MEUR 2.9).
• Diluted earnings per share were 1.5 cents (0.2 cents). Comparable diluted earnings per share were 2.2 cents (0.2 cents).
• In March, CapMan Plc completed the acquisition of Dasos Capital Oy.

MANAGEMENT COMPANY AND SERVICE BUSINESS		INVESTMENT BUSINESS

	Fee Profit			Carried interest

Return on investments

1-3 2024

€2.7m

Growth 1-3 2024

- €0.2m /-8%

Growth/last three years

+13% p.a.

1-3 2024

€3.5m

Growth 1-3 2024

+ €3.5m /n.a.

Average/last three years

€6.4m

Fair value change 1-3 2024

€2.3m /+2%

Fair value of investments 31.3 2024

€163m

Fair value change/last three years

+13% p.a.

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CAPMAN PLC 1-3 2024 INTERIM REPORT

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CEO's comment:

Despite a continued challenging market environment, CapMan has had a strong start to the year. At the end of the first quarter assets under management were at EUR 5.7 billion, up 13% vs year end. In addition, we have during April successfully completed two flagship fundraisings. Turnover and operating profit grew, boosted by carried interest from our credit fund.

Turnover grew by 22% during reporting period

During the first quarter our turnover grew by 22% compared to the same period last year. The growth was mainly driven by carried interest from our credit fund which exited two of its investments during the review period. Fee profit was slightly below last year's level, but the visibility for the development for the remainder of the year has increased with the final closings of Nordic Infrastructure II fund at target size and Growth Equity III fund above target size. In addition to these, fee profit growth is supported by the acquisition of Dasos Capital that was completed on March 1st. The profit impact of the acquisition and the completed fundraisings will be fully visible in the result from the second quarter onwards.

Our balance sheet investments also contributed to the strong result through a +1.5% positive fair value change. The fair value development was primarily driven by positive development in CapMan's private equity funds. While the external fund investments also had a positive development during the first quarter, the current market environment still gives reason to prepare for volatility going forward especially in the venture capital funds.

Successful fundraisings and strong growth in assets under management

Assets under management grew by 13% to EUR 5.7 billion in the first quarter of the year. In addition, we have during April raised over 110 million euros of new capital to our Infrastructure and Growth funds.

In beginning of March, we closed the acquisition of Dasos Capital and established Natural Capital as a new investment area for CapMan. Dasos Capital has continued fundraising to their open-ended fund Dasos Sustainable Forest and Wood III. At the end of March CapMan Natural Capital had a total of EUR 714 million assets under management.

The CapMan Nordic Infrastructure II fund held its final close in late April reaching EUR 375 million, which is a doubling in size compared to the Infrastructure I fund. The investment strategy is attractive especially for international institutional investors, and around 70% of the capital in the fund comes from outside the Nordics.

The CapMan Growth Equity III fund held a first close above target size in February, and a final close at hard cap of EUR 130 million in April. The fast fundraising and the high quality of the investor base is a testament to the stellar performance of the strategy. In April, the fund also announced its first investment into environmental technology company Tana.

At the end of 2023 we established the Social Real Estate fund, which has already completed two investments in Finland and Denmark. Fundraising for the fund continues, with the target to reach 500 million euros over the coming years. The fundraising for real estate's flagship fund Nordic Real Estate IV has started, and we target a first close during 2024 and a target size of 750 million euros at the final close of the fund.

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CAPMAN PLC 1-3 2024 INTERIM REPORT

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Being part of the transition towards a more sustainable society

We continue to participate in the transition towards a sustainable society through active ownership in our investments, where we systematically integrate the sustainability and financial value creation plans. We have published our Investments Sustainability Report for 2023. The report is prepared in accordance with GRI and gives information about the sustainability work done in our holdings across real estate, infrastructure, private equity and credit funds.

Pia Kåll

CEO, CapMan Plc

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CAPMAN PLC 1-3 2024 INTERIM REPORT

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CapMan Plc 1-3 2024 Interim Report

Group turnover and result in 1-3 2024

Table 1: Group turnover and result in 1-3 2024

€ ('000)	1-3/2024	1-3/2023	Change
Fee income		14,857			15,128		-2%
Carried interest		3,522			-27		n/a
Turnover		18,379			15,102		22%
Turnover, internal
Operating expenses		-13,421			-12,181		10%
Fair value changes		2,338			-2,391		n/a
Operating profit		7,296			529		1,278%
Items impacting comparability		1,282			0		n/a
Comparable operating profit		8,578			529		1,520%
Less:
Carried interest		-3,522			27		n/a
Fair value changes of investments		-2,338			2,391		n/a
Fee profit		2,718			2,947		-8%
Result for the period		4,936			769		542%
Comparable profit for the period		6,163			769		701%
Earnings per share, diluted, cents		1.5			0.2		650%
Comparable earnings per share,		2.2			0.2		1000%
diluted, cents

CapMan Group's turnover totalled MEUR 18.4 in the period spanning 1 January-31 March 2024 (1 January-31 March 2023: MEUR 15.1). The increase in turnover was driven by carried interest income whereas fee income was slightly below the comparison period.

Operating expenses were MEUR 13.4 (MEUR 12.2) with the main items being:

• Material and services MEUR 0.6 (MEUR 0.3).
• Personnel expenses MEUR 8.5 (MEUR 8.9)
• Depreciations and amortisations MEUR 0.5 (MEUR 0.4)
• Other operating expenses MEUR 3.9 (MEUR 2.6).

The increase in operating expenses was mainly due to acquisition related other operating expenses. Operating expenses less items affecting comparability were below the comparison period at MEUR 12.1 (MEUR 12.3).

Fair value changes of investments were MEUR +2.3 (MEUR -2.4), corresponding to +1.5 per cent (-1.4 per cent).

The comparable operating profit was MEUR 8.6 (MEUR 0.5). The increase was due to higher carried interest and fair value changes.

Fee profit decreased slightly from the comparison period due to lower fee income and was MEUR 2.7 (MEUR 2.9).

The profit for the period was MEUR 4.9 (MEUR 0.8). The comparable profit for the period was MEUR 6.2 (MEUR 0.8.)

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CAPMAN PLC 1-3 2024 INTERIM REPORT

A quarterly breakdown of turnover and profit, together with turnover, operating profit/loss, and profit/loss by segment for the period, alternative performance measures as well as items affecting comparability are available in the Tables section of this report.

Assets under management as at 31 March 2024

Assets under management refers to the remaining investment capacity of funds and capital already invested at acquisition cost or at fair value when referring to mandates and open-ended funds. Assets under management is calculated based on the capital, which forms the basis for management fees, and includes primarily equity without accounting for the funds' debt. AUM is impacted by fundraising, exits and fair value changes for open-ended funds as well as wealth management.

Assets under management was MEUR 5,672 as at 31 March 2024 (31 December 2023: MEUR 5,005). The increase was mainly due to the acquisition of Dasos Capital, which now forms the Natural Capital investment area. In addition, some MEUR 90 of new capital was raised during the period.

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Table 2: Assets under management (incl. funds and mandates)

		31.3.24		31.12.23
			(MEUR)	(MEUR)
Real Estate			2,905		2,933
Private Equity & Credit			1,028		1,022
Natural Capital			714		n/a
Infra			559		562
Wealth Management			467		488
Total assets under			5,672		5,005
management

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CAPMAN PLC 1-3 2024 INTERIM REPORT

Management Company business

In its Management Company business, CapMan manages private asset funds and offers wealth advisory services. Income from the Management company business is derived from management fees, wealth advisory fees, property- and asset management fees, and carried interest received from funds.

Table 3: Management company turnover and result in 1-3 2024

€ ('000)	1-3/2024	1-3/2023	Change
Fee income		11,842			12,485		-5%
Carried interest		3,522			-27		n/a
Turnover		15,363			12,458		23%
Turnover, internal					3
Operating expenses		-9,099			-9,300		-2%
Operating profit		6,263			3,160		98%
Items impacting comparability		123			0
Comparable operating profit		6,386			3,160		102%
Less:
Carried interest		-3,522			27		n/a
Fee profit		2,864			3,187		-10%

Fee income fell by 5 per cent due to timing of fund closings and lower sales from property- and asset management services.

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Carried interest was received due to exits from the Nest 2015 fund. Nearly all investments in the fund have now been exited. In the comparison period, CapMan received no carried interest.

Turnover grew by 23 per cent during the period due to carried interest income.

Operating expenses decreased by 2 per cent mainly due to lower personnel expenses.

Comparable operating profit more than doubled to MEUR 6.4 (MEUR 3.2) due to carried interest received during the period.

The fee profit of the segment decreased slightly to MEUR 2.9 (MEUR 3.2). The decrease was due to lower fee income, partially offset by lower operating expenses.

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CAPMAN PLC 1-3 2024 INTERIM REPORT

Service business

In the Service business, CapMan offers procurement services and distributes software licenses to companies in Finland, Sweden and the Baltics, through CapMan Procurement Services (CaPS). Until February 1, 2023, Service business also included JAY Solutions, which offered reporting and back-office services to investors.

Table 4: Service business turnover and result in 1-3 2024

€ ('000)	1-3/2024	1-3/2023	Change
Fee income		2,864			2,620		9%
Turnover		2,864			2,620		9%
Turnover, internal					44
Operating expenses		-1,176			-1,190		-1%
Operating profit		1,688			1,473		15%
Fee profit		1,688			1,473		15%

Turnover increased by 9 per cent due to the continued strong growth of CaPS. Until 1 February 2023 the segment also included the currently divested JAY Solutions. Excluding JAY Solutions, the Service business grew by 15 per cent (14 per cent) during the period.

Operating expenses of the Service business fell by 1 per cent due to the divestment of JAY solutions.

The operating profit of the Service business was MEUR 1.7 (MEUR 1.5).

As the segment generates no carried interest or fair value changes, the fee profit equals to the operating profit of the segment.

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Investment business

Through its Investment business, CapMan invests from its own balance sheet in the private markets asset classes and mainly to its own funds. In addition to own funds, CapMan selectively invests in private market funds managed by external fund managers.

Table 5: Investment business turnover and result in 1-3 2024

€ ('000)	1-3/2024	1-3/2023	Change
Operating expenses	-229	-145	58%
Fair value changes	2,338	-2,391	n/a
Operating profit (loss)	2,109	-2,536	n/a
Comparable operating profit (loss)	2,109	-2,536	n/a
Less:
Fair value changes of investments	-2,338	2,391	n/a
Fee profit	-229	-145	58%

Fair value changes were MEUR +2.3 (MEUR -2.4), corresponding to a +1.5 per cent (-1.4 per cent) change in fair value.

Investments into funds managed by CapMan developed on average positively contributing MEUR + 1.5 (MEUR +2.1) of the total fair value change, corresponding to a +1.3 per cent (+1.8 per cent) change in value, mainly due to positive development in private equity funds.

Investments into external funds also developed positively with fair value changes of MEUR +0.9 (MEUR -4.5), corresponding to a change of 1.7 per cent (-7.9 per cent)

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CAPMAN PLC 1-3 2024 INTERIM REPORT

Operating profit for the Investment business was MEUR 2.1 (Operating loss MEUR 2.5).

Fee profit was MEUR -0.2 (MEUR -0.1). As the segment generates no fee income, the fee profit equals to the operating expenses of the segment.

On 31 March 2024 the fair value of CapMan's fund investments stood at MEUR 162.8 (MEUR 167.5).

Investments in portfolio companies are valued at fair value in accordance with the International Private Equity and Venture Capital Valuation Guidelines (IPEVG). Investments in real estate are valued at fair value based on appraisals made by independent external experts. Valuation of external funds is based primarily on fair values reported by respective external fund managers. Sensitivity analysis by investment area is presented in the Tables section of this report.

Balance sheet and financial position as at 31 December 2023

CapMan's balance sheet totalled MEUR 295.0 as at 31 March 2024 (31 March 2023: MEUR 265.3), of which goodwill amounted to MEUR

30.6 (MEUR 7.9). Cash in hand and at banks amounted to MEUR 49.3 (MEUR 50.8).

CapMan's total equity amounted to MEUR 143.7 (MEUR 114.0). The increase in equity was mainly due to the directed share issue related to the acquisition of Dasos Capital completed on 1 March 2024. Interest- bearing net debt amounted to MEUR 44.2 (MEUR 44.6). CapMan's total interest-bearing debt as at 31 March 2024 is outlined in Table 1.

			CEO	| REPORT TEXT	| TABLES
	Table 7: CapMan's interest bearing debt
			Debt	Matures	Annual	Debt
			amount 31	latest	interest	amount 31
			March			Dec 2023
			2024			(MEUR)
			(MEUR)
	Senior bond (issued in 2020)		50 MEUR	Q4 2025	4.00%	50 MEUR
	Senior bond (issued in 2022)	40 MEUR	Q2 2027	4.50%	40 MEUR
	Long-term credit facility	(20 MEUR)	Q3 2024	1.75-2.70%	(20 MEUR)
	(available)

CapMan's bonds and long-term credit facility include financing covenants, which are conditional on the company's equity ratio and net gearing ratio. CapMan honoured all covenants as at 31 March 2024. The senior bond issued in 2022 is linked to sustainability targets, which CapMan achieved in April 2023.

The Group's cash flow from operations totalled MEUR 6.1 during the period (MEUR +6.7). CapMan receives management fees from funds semi-annually, in January and July, which is shown under working capital in the cash flow statement.

Cash flow from investments totalled MEUR +4.4 (MEUR +2.7) and includes, inter alia, investments and repaid capital received by the Group. CapMan makes investments mainly through its investment company and its investments and cash on hand are classified as fund investments.

Cash flow from financing was MEUR -2.2 (MEUR -14.4).

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CAPMAN PLC 1-3 2024 INTERIM REPORT

Sustainability

CapMan's vision is to become the most responsible private assets company in the Nordics. A strategic objective is to integrate sustainability into all operations and implement it in the product offering, fundraising, investment activities, fund management, services and the development of personnel and work environment, among others.

In April 2024, CapMan published its Investment Sustainability report for 2023. The report is prepared in accordance with GRI and gives information about the sustainability work done in our holdings across real estate, infrastructure, private equity and credit funds.

Progress on environmental targets

CapMan has made the commitment to achieve net zero emissions by 2040, which includes both CapMan's own operations (Scope 1 and 2) and CapMan's investments (Scope 3).

During the first quarter of 2024, CapMan Real Estate was selected among the first companies globally to participate in the Science Based Targets initiative (SBTi) Buildings pilot test. This puts CapMan on the forefront of developing tools for decarbonisation of buildings. The emission reduction plan was made during Q1 2024 and submitted for SBTi for feedback.

CapMan is in the process to develop a proprietary Nature positive approach and assessment tool for all investment areas. CapMan has signed up as an early-adopter of Taskforce for Nature-related Financial Disclosures (TNFD), which is the premier global risk management and disclosure framework for nature.

Progress on social and governance targets

CapMan strives to be a diverse, equal, and inclusive work community. To promote good governance, CapMan has introduced sustainability metrics

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as part of variable renumeration. Part of the long-termshare-based incentives are determined following the achievement of sustainability targets.

CapMan's Management Group with the support of CapMan's internal DEI (diversity, equity and inclusion) working group has continued its systematic work to reach our medium- and long-term diversity targets. During the first months of the year DEI was progressed among other things by work done to identify the enablers and possible deterrents to increase the share of women on all tenure levels in its investment teams, This was done through interviews with female investment professionals across investment teams.

Key figures 31 March 2024

CapMan's return on equity was 15.3 per cent on 31 March 2024 (31 March 2023: 2.4 per cent) and the comparable return on equity was 19.1 per cent (2.4 percent). Return on investment was 13.1 per cent (0.9 per cent) and the comparable return on investment was 15.4 per cent (0.9 per cent). Equity ratio was 50.1 per cent (44.1 per cent).

According to CapMan's long-term financial targets, the target level for the company's return on equity is on average over 20 per cent. The objective for the equity ratio is more than 50 per cent.

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