Taaleri Plc Financial Statements Bulletin 1 January–31 December 2021: A very strong last quarter for Taaleri – operating profit more than doubled to EUR 14.7 million and was 50% of income
TAALERI PLC STOCK EXCHANGE RELEASE 16 FEBRUARY 2022 AT 8:00 (EET)
Taaleri Plc Financial Statements Bulletin 1 January–31 December 2021: A very strong last quarter for Taaleri – operating profit more than doubled to EUR 14.7 million and was 50% of income
October–December 2021, segment reporting, continuing operations
- The income according to the segment reporting grew by 87.7% to EUR 29.4 (15.7) million.
- Continuing earnings grew by 16.3% to EUR 11.4 (9.8) million. The continuing earnings of the Private Asset Management segment grew by 2.9% to EUR 5.4 (5.3) million, and the continuing earnings of the Strategic Investments segment by 45.6% to EUR 5.5 (3.8) million.
- Performance fees accrued at record levels being EUR 10.6 (0.9) million and investment operations generated EUR 7.4 (4.9) million.
- According to segment reporting, operating profit more than doubled to EUR 14.7 (6.6) million, corresponding to 49.9% (42.0) of income.
- The assets under management in the Private Asset Management segment grew by 34.6% to EUR 2.2 (1.7) billion.
October–December 2021, IFRS reporting, continuing operations
- Income from continuing operations in accordance with IFRS grew by 119.3% to EUR 30.2 (13.8) million.
- Operating profit was EUR 14.7 (5.9) million and profit for the period in accordance with IFRS was EUR 12.1 (6.8) million, taking into account the discontinued operations.
- Earnings per share were EUR 0.42 (0.13) for continuing operations.
January–December 2021, segment reporting, continuing operations
- The income according to the segment reporting grew by 74.1% to EUR 69.7 (40.0) million, mostly due to changes in the fair value of investment operations and performance fees.
- Continuing earnings grew by 13.5% to EUR 40.7 (35.9) million. The continuing earnings of the Private Asset Management segment grew by 8.7% to EUR 20.1 (18.5) million, and the continuing earnings of the Strategic Investments segment by 20.2% to EUR 17.6 (14.6) million.
- Performance fees accumulated at record levels being EUR 11.4 (1.0) million and investment operations generated EUR 17.6 (3.2) million.
- According to segment reporting, operating profit was EUR 30.8 (12.3) million, corresponding to 44.2% (30.8) of income.
- The operating profit from discontinued operations for January-April was EUR 3.3 (January–December 2020: 8.5), including EUR 1.6 million of costs related to the sale of the wealth management operations.
January–December 2021, IFRS reporting, continuing operations
- Income from continuing operations in accordance with IFRS amounted to EUR 72.6 (34.0) million and operating profit to EUR 28.8 (9.6) million. A total of EUR 2.1 million in non-recurring expenses were attributed to the divestment of the wealth management operations.
- The operating profit of discontinued operations totalled EUR 116.1 (11.0) million, which consists of a profit of EUR 111.1 million from the sale of the wealth management operations and EUR 5.0 million of net operating profit from the wealth management operations in January–April.
- The profit for the financial year from continuing and discontinued operations was EUR 136.1 (13.0) million.
- Earnings per share were EUR 0.75 (0.11) for continuing operations, EUR 4.06 (0.35) for discontinued operations and EUR 4.81 (0.45) for the profit of the period.
- The Extraordinary General Meeting decided on 28 May 2021 to pay an additional distribution of assets of EUR 1.00 per share.
- The Board of Directors proposes a dividend of EUR 1.20 per share for 2021.
On April 30, 2021, Taaleri completed the sale of its wealth management operations to Aktia and recognized a tax-free gain of EUR 111.1 million on the transaction. Taaleri applies the requirements of IFRS 5 Non-current Assets Held for Sale and Discontinued Operations in the classification, presentation, and recognition of sale of the wealth management operations.
There are differences in the figures in the Group's consolidated income statement and segment reporting due to the application of IFRS 5. In the consolidated income statement (p. 28), intra-group income and expenses between discontinued and continuing operations have been eliminated. In segment reporting, income and expenses between discontinued and continuing operations are presented as transactions outside the Group. The earnings figures in the explanatory section in this Financial Statements Bulletin represents the Group's continuing operations according to segment reporting, unless otherwise stated. The chosen presentation will improve the comparability of segment reporting in the coming years.
Taaleri has changed the definition of Operating profit as of the 2021 Financial Statements. The interest and other financing expenses has been moved down the income statement below the Operating profit. In Taaleri's view, the chosen presentation is more in line with market practice and after the change, the Operating profit subtotal in the income statement better reflects Taaleri's operative profit. The change in presentation has no effect on the result for the financial year. The presentation of data for the comparison period has been adjusted accordingly.
This Financial Statements Bulletin has been prepared in accordance with IAS 34. The Financial Statements Bulletin is based on the audited Financial Statements of 2021. The auditor's report has been issued on 16 February 2022. See page 23 for further information of the accounting policies of this Financial Statements Bulletin.
REVIEW BY CEO PETER RAMSAY
Taaleri’s last quarter of 2021 was very strong. The group income was EUR 29.4 million and the operating profit was 50%, as significant performance fees, strong investment income and more than 16% growth in continuing earnings boosted operating profit to EUR 14.7 million.
We can be very pleased with 2021, a year of big changes. We sold our wealth management operations to Aktia in the spring, renewed our strategy and developed our private asset management business in line with our plans. We focus on renewable energy and other alter-native investments that create not only financial returns but also positive and sustainable im-pacts on the environment and society. The launch of the Taaleri Bioindustry I fund at the end of the year is an important step in this direction.
The income from continuing operations in 2021 grew to EUR 69.7 million and operating profit grew to EUR 30.8 million, representing 44% of income. The Group’s profit for the financial period, including the profit from the sales of the wealth management operations, was EUR 136.1 million. The assets under our management grew to EUR 2.2 billion.
In the Private Asset Management segment, during the last quarter we prepared and launched new funds and promoted the projects in the funds in investment phase. In line with the nature of the private asset management business, we will make early-stage investments in the growth of the business during the current year. Income will begin to accrue once a new fund is successfully launched, and the first round of fundraising is completed.
The largest business in the Private Asset Management segment, the renewable energy business, completed four international investments in the Taaleri SolarWind II fund and the refinancing of the Taaleri Wind II and Wind III funds during the last quarter, which increased the funds' performance fee potential to an estimated EUR 20 million. In addition, Taaleri Energia raised EUR 44 million to accelerate project development and secure quality investments for future funds.
In the real estate business, the newest fund, Taaleri Housing Fund VIII, raised EUR 58 million in its first round of funding. The fund is the first to be set up jointly by Taaleri and Aktia. The fund launched its investment activities at the beginning of 2022. In addition, during the last quarter we recognized EUR 3.9 million in net performance fees from the sale of Taaleri Housing Fund VI, which was completed in the summer. It has been decided to merge the infrastructure business, which previously operated as its own business, with the real estate business as of February 2022.
As a European pioneer, the bioindustry business launched a fund, which focuses on industrial-scale bioindustry projects that promote sustainable development. Taaleri Bioindustry I was one of Finland’s first private equity funds to be classified as dark green, i.e., funds compliant with Article 9 of the EU’s Sustainable Finance Disclosure Regulation.
In the Strategic Investments segment, Garantia continued its very strong business and achieved its best full-year result in its history with an operating profit of EUR 22.0 million. In the last quarter, net income from guaranty insurance operations increased by 45% and the combined ratio describing the profitability of insurance operations was 39.9%, while claims incurred remained low.
2021 was the second year of the coronavirus pandemic, and we got better at living with it. I would like to warmly thank our staff for their excellent work during a challenging year, and our customers and partners for their trust and cooperation. I would also like to welcome our new shareholders to our journey - the number of our shareholders increased by 1,700, or more than a quarter, over the past year.
We at Taaleri want to be a pioneer in alternative investments focusing on sustainability. I believe that we have an excellent chance of achieving our goal with the help of all our employees, customers, and partners.
GROUP KEY FIGURES
| Group key figures, continuing operations in segment reporting | 10–12/2021 | 10–12/2020 | Change, % | 1–12/2021 | 1–12/2020 | Change, % |
| Earnings key figures | ||||||
| Continuing earnings, MEUR | 11.4 | 9.8 | 16.3 | 40.7 | 35.9 | 13.5 |
| Income, MEUR | 29.4 | 15.7 | 87.7 | 69.7 | 40.0 | 74.1 |
| Operating profit, MEUR | 14.7 | 6.6 | 123.3 | 30.8 | 12.3 | 149.8 |
| Operating profit, % | 49.9 | 42.0 | 44.2 | 30.8 | ||
| Profit for the period in consolidated income statement, MEUR | 12.1 | 6.8 | 77.8 | 136.1 | 13.0 | >100.0 |
| Return on equity*, % | 21.5 | 21.0 | 75.0 | 10.0 | ||
| Balance sheet key figures | ||||||
| Equity ratio, % | 72.1 | 49.7 | 72.1 | 49.7 | ||
| Other key figures | ||||||
| Cost/income ratio excluding investment operations | 68.0 | 92.0 | 77.9 | 83.6 | ||
| Cost/income ratio | 51.0 | 63.1 | 58.3 | 77.0 | ||
| Full-time personnel in continuing operations, at the end of the period | 104 | 92 | 13.0 | 104 | 92 | 13.0 |
| Assets under management in Private Asset Management segment, BEUR | 2.2 | 1.7 | 2.2 | 1.7 | 34.6 | |
| Guaranty insurance portfolio, BEUR | 1.7 | 1.8 | 1.7 | 1.8 |
OUTLOOK AND FINANCIAL TARGETS
Taaleri does not publish a short-term outlook. However, the company has set itself targets related to growth, profitability and return on invested capital.
Taaleri’s long-term targets include:
- Continuing earnings growth at least 15 per cent
- Operating profit at least 25 per cent of income
- Return on equity at least 15 per cent.
The company’s goal is to distribute to its shareholders at least 50 per cent of the profit for the financial year as well as the capital that the company does not need for growth investments or to fulfil its targets for solvency.
WEBCAST PRESENTATION FOR ANALYSTS AND MEDIA
A live webcast for analysts and the media will be held on 16 February 2022, at 11.30 a.m. The event is in Finnish. The webcast can be followed online at https://taaleri.videosync.fi/osavuosikatsaus-q4-2021/. The event will be recorded and will be available later on Taaleri's investor pages at www.taaleri.com/en/investors/reports-and-presentations.
Helsinki, 16 February 2022
Taaleri Plc
Board of Directors
For further information, please contact:
CEO Peter Ramsay, +358 50 343 7493, [email protected]
CFO Minna Smedsten, +358 40 700 1738, [email protected]
Head of Communications and IR Siri Markula, +358 40 743 2177, [email protected]
Distribution:
Nasdaq Helsinki
Key media
www.taaleri.com
Taaleri in brief
Taaleri is a Nordic investment and asset manager with an emphasis on renewable energy and other alternative investments. We channel capital towards economically profitable undertakings that have a lasting positive impact on the environment and society. We combine capital with talent, expertise, entrepreneurship, and a bold sense of purpose. We are a signatory of the UN Principles for Responsible Investment (UNPRI) since 2010, and we joined the Net Zero Asset Managers initiative in 2021. Taaleri’s vision is to be a Nordic forerunner in alternative investments focusing on sustainability.
Taaleri has two business segments: Private Asset Management and Strategic Investments. Private Asset Management consists of renewable energy, real estate and bioindustry businesses. The Strategic Investments segment includes Garantia Insurance Company Ltd.
Taaleri has EUR 2.2 bn of assets under management in its private equity funds and co-investments. The company has approximately 120 employees. Taaleri Plc is listed on Nasdaq Helsinki.
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