Taaleri: A mixed bag with strong carry while investment operations clearly negative in Q4 - Nordea

Taaleri reported Q4 EBIT of EUR 7.1m, coming 24% below Refinitiv consensus at EUR 9.3m. Based on segment reporting, Q4 total income was EUR 17.3m, 2% above Nordea estimate of EUR 17.0m. Recurring revenues were EUR 11.7m in Q4, beating our estimate by 3%. Fair value changes of investments were EUR +2.4m in Q4, while we had anticipated EUR +1.5m. Investment operations income of EUR -6.7m came clearly below our estimate of EUR 0.6m. As the company recorded EUR 12.4m carry in Q4 (we expected EUR 5m), private asset management EBIT beat our estimates clearly. When adjusting for carry, private assets management EBIT was EUR 0.0m versus our EUR -0.6m estimate. Dividend proposal is EUR 0.70 (consensus EUR 0.99). Private asset management recurring revenues came 2% above our estimate. Hence, underlying operations have continued to perform well in Q4. Garantia’s loan losses continued at a low level (0.9%) while net premiums were flat y/y, while we had anticipated 6% decline against tough comps. Combined ratio remained at a strong level and was 23.9% in Q4 and beat our estimate of 34.6%. Solvency was at 231.3%. Private asset management AuM was up 13% y/y to EUR 2.5bn (EUR 2.2bn in 2021). SolarWind III is expected to reach first closing early 2023 with target of EUR 700m of commitments. On initial take, we expect consensus to make neutral to slightly negative underlying estimate revision while we note lower-than-anticipated dividend proposal. We have a fair value range of EUR 10.8-12.3 per Taaleri share.

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