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Invalda INVL Investor Presentation 2011
2247_rns_2011-11-30_03b4b1f3-3c7f-4116-9eff-bfce1296423d.pdf
Investor Presentation
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Invalda
Preliminary results of Invalda AB group for the period 9 months ending 30 September 2011
Vilnius, 30 November 2011
What is Invalida AB?
Invalida
- Invalida AB is one of the major Lithuanian investment companies whose primary objective is to steadily increase the investor equity value.
Invalida actively manages its investments, exercising control or significant influence over target businesses.
More about businesses managed by Invalida in 20-31 slides and on www.invalida.lt
- Invalida started its activity in 1991.
Its shares have been traded on the NASDAQ OMX Vilnius exchange since 1995.
More about shares of Invalida in 8-9 slides.
Invalda
Management principles
Invalda is proactively managing its investments following these principles:
-
Competitiveness and independence
Each business of the Group must be competitive and self-sufficient, have professional teams and top managers capable of creating business visions and implementing ambitious objectives. -
Risk segregation
Invalda does not grant guarantees or assumes any obligations in respect of individual businesses, and individual businesses do not assume any obligations in respect of each other. -
Diversification
The company diversifies its investment in order to avoid any excessive risk concentration in homogeneous business sectors. -
Transparency
Invalda discloses information in adherence to the requirement that market participants must get equivalent information at the same time, except such cases where the publication of the information is not possible in view of obligations assumed in respect of third parties, and/or the disclosure may adversely affect the Group's or business ability to compete. -
Avoidance of conflicts of interest
Managers of the Group companies do not participate in the activities of their competitors or competing businesses.
Investment philosophy
Invalda
- Invalda is the company driven by shareholder value creation.
Invalda seeks to acquire competitive businesses that, with additional capital or management resources, may successfully be developed organically, consolidate fragmented markets or otherwise increase value.
Investing into undervalued assets that, when restructured, may facilitate significant value increase.
Invalda does not avoid complex business opportunities. Such approach is supported by belief that the efforts will lead to good results.
- Long-term prospects.
With a view to maximize the investment potential, Invalda normally pursues long-term perspectives.
Invalda focuses its efforts to maximize the investment value in the long-term perspective, and offers business for sale only when they are properly prepared and become attractive to potential buyers, or having received any proposal matching future prospects of companies.
- A merge of different competences may potentially increase the investment value.
Invalda
Activity sectors of Invalda Group
Invata
The structure of shareholders
Votes owned as of 30-09-2011
Management
Invalda
Vytautas Bucas - Chairman of the Board
Vytautas Bucas is a member of ACCA (Association of Chartered Certified Accountants, UK) since 2002. After graduation from his studies at Vilnius University for a period he worked at the audit firm Arthur Andersen, where, having started from an auditor assistant grew to the position of the Chief auditor. Later on, in SEB Bank he was managing the Finance and IT departments, was holding the position of the Deputy President, and a Member of the Board of the Bank. In the course of the past five years was a member of the Board of companies operating in the finance and real estate sector, also the pharmaceuticals company Sanitas, currently - member of the Board of Inreal Pastatu Prieziura and BAIP Group, Chairman of the Board of Vilniaus Baldai, Invaldos Nekilnojamojo Turto Fondas and Invalda which he joined in 2006.
Darius Sulnis - Member of the Board, President
Darius Sulnis acquired his Master's degree in accounting and audit at Vilnius University. He has for eight years managed the financial brokerage firm Finasta, and for four years - a real estate company Invalda Nekilnojamojo Turto Valdymas. Furthermore, Darius Sulnis has been a member of Boards and Supervisory Boards of a number of Polish, Latvian and Lithuanian companies. Currently Darius Sulnis is the President and a member of the Board of the investment company Invalda. Also he had been for a considerable period of time a Member of the Boards of Vilniaus Baldai, Umega, Invaldos Nekilnojamojo Turto Fondas.
Dalius Kaziunas - Member of the Board
Dalius Kaziunas holds a Master's degree in economics, graduate of Vilnius University. Dalius Kaziunas has for more than 10 years worked at the financial brokerage firm Finasta, of which was its General Manager for six years. In 2008-2009 he was General Manager and Chairman of the Board of the Bank Finasta. For the past two years Dalius Kaziunas has been working as an advisor for Invalda, and is a Member of its Board, as well as Member of the Boards of Ineturas, Ireal Pastatu Prieziura, Vilniaus Baldai, Kelio Zenklai, BAIP Group, Jurita, Tiltra Group. Moreover, Dalius Kaziunas is a Chairman of the Board at Lauko Gelininkystes Bandymu Stotis UAB and Zemepatis UAB.
Information about Invalda AB shares
Invalda
| Total number of securities | 51 659 758 (units) |
|---|---|
| Nominal value | 1 LTL |
| ISIN | LT0000102279 |
| Name | IVL1L |
| Exchange | NASDAQ OMX Vilnius |
| List | BALTIC MAIN LIST |
The company has issued convertible bonds of 32.44 m LTL in nominal value; after converting, the authorized capital could increase by 5.898.182 shares of 1 LTL in nominal value.
| | 2010
9 months | 2011
9 months |
| --- | --- | --- |
| Price of shares, EUR: | | |
| - open | 0.533 | 2.000 |
| - highest | 1.335 | 2.650 |
| - lowest | 0.521 | 1.750 |
| - last | 1.208 | 1.947 |
| Turnover, mEUR | 3.82 | 7.18 |
Capitalization, m EUR
Trading in shares
Invalid
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Dow Jones Stoxx EU Enlarged TMI index cover approximately 95% of the free float market capitalisation of the New Europe countries, including Bulgaria, Cyprus, Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Romania, Slovakia and Slovenia.
Invalida
Financial results
Key events
(1)
Invalda
- An agreement regarding investments in Litagra was signed (1)
Agreements regarding investments in Litagra, one of the largest companies operating in the agricultural sector of the Baltic countries, were signed on 7th November, 2011.
The transactions should be closed when the permission of the Competition Council is received.
Invalda will purchase 36.9 percent of Litagra shares for 38.6 mLTL (11.2 mEUR), 37.1 mLTL (10.7 mEUR) out of this amount will be invested into new share issue of Litagra.
The enterprise value of Litagra has been estimated at about 200 mLTL (57.9 mEUR) before the acquisition of new share issue.
Key events
(1)
Invalda
- An agreement regarding investments in Litagra was signed (2)
Mr. Gintaras Kateiva, Chairman of the Board at Litagra, will own 37 percent of Litagra shares, Invalda AB – 36.9 percent, investment fund Amber Trust II – 18 percent, Mr. Dziugas Grigaliunas and Mr. Adomas Grigaitis, managers of Litagra Group, - 6.4 percent and 1.7 percent respectively.
The companies of Litagra Group are engaged in the primary crop and livestock (milk) production, grain processing and agricultural services.
During the three quarters of 2011 the consolidated turnover of Litagra Group was 271.7 mLTL (78.7 mEUR), i.e. 17.5 percent higher than during the same period of the last year (231.3 mLTL (67 mEUR)). EBITDA of Litagra Group during the comparative period has increased by 19 percent - from 16.3 mLTL (4.7 mEUR) to 19.4 mLTL (5.6 mEUR).
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Key events
(2)
Invalda
Investments in Snoras products
Invalda has acquired 20 mLTL (5.79 mEUR) deposit certificate of AB bank Snoras.
In November, the Government took over 100 percent of AB bank Snoras shares. The Bank of Lithuania has limited activities of AB bank Snoras, revoked the bank's business license and decided to apply to court for a bankruptcy.
After considering opportunities to recover funds, Invalda formed a provision equal to 100 percent of the invested amount. The provision is reflected in the financial statements of Invalda for the third quarter.
Key events
(3)
Invalid.
Acquisition:
BAIP group acquired 100 percent shares of Norwegian company Norway Registers Development for 1.2 mEUR (4.14 mLTL). Norway Registers Development owns 70.73 percent shares of NRD UAB in Lithuania.
The acquired company specializes in the programming of register systems. Almost half of the revenues are accumulated abroad.
Previous events
(1)
Invalida
- On 19 August 2011 the sale of shareholding in Sanitas AB to Valeant Pharmaceuticals International, Inc. was completed
Invalida sold 26.5 percent stake in Sanitas AB, for which Valeant has paid 83 mEUR (286.7 mLTL), or 10.06 EUR (34.74 LTL) per share.
Taking into account share price adjustment mechanism set out in the agreement signed on 24th October, 2008, (regarding sale of 20.3 percent of the share capital of Sanitas) total proceedings of Invalida from Sanitas shares amounted to 91.4 mEUR (315.6 mLTL).
Net gain in the consolidated financial statements of Invalida Group and standalone financial statements of AB Invalida is approximately 185.9 mLTL (53.8 mEUR) and 204.5 mLTL (59.2 mEUR) respectively.
This is one of the most successful deals during Invalida's history, which allowed to earn profits to other financial investors, small shareholders and to Sanitas' management.
Previous events
(2)
Invalida
- In April a merger of Trakcja Polska and Tiltra Group completed.
Invalida sold 44.8 percent stake in Tiltra Group and 43.4 percent stake in Kauno Tiltai AB for 314.1 mPLN and acquired 12.5 percent stake in Trakcja Polska for 132.3 mPLN, Trakcja Polska bonds for 119.8 mPLN and got 62 mPLN in cash.
Proceedings paid to Invalida AB for shares in Tiltra Group AB and Kauno Tiltai AB might be reduced by not more than 60.6 mPLN, depending on the financial results of the years ending 31 March 2011 and 31 March 2012.
Positive result in consolidated financial statements of Invalida Group is 155.3 mLTL (45 mEUR), standalone company –108.2 mLTL (31.3 mEUR).
During the first nine months of 2011, a provision amounting to 42.5 mLTL (12.3 mEUR) and related to a possible price decrease was formed.
Previous events
(3)
Invalda
Other events
After completion of Sanitas and Tilta transactions Invalda repaid practically all financial obligations to banks and group companies.
A company Jurita joined the facility management sector from August 2011. This company was acquired for 2.5 mLTL (0.7 mEUR) from Vilnius City Municipality.
A company Inreal GEO, which will provide land geodetic measurements services, was established.
Invalda group increased stake in Vernitas AB up to more than 20 percent.
Invalda group increased stake in Umega AB up to 29.5 percent.
Group company acquired 51 percent of Lauko Gelininkystes Bandymu Stotis shares from the State Property Fund for 911 thousand LTL (263.8 thousand EUR). Later the stake was increased up to 100 percent.
Activity results of Invalida AB
Invalida
| Consolidated | Parent company | |||
|---|---|---|---|---|
| mLTL | 2010 | |||
| 9 months | 2011 | |||
| 9 months | 2010 | |||
| 9 months | 2011 | |||
| 9 months | ||||
| Assets | 592.4 | 704.3 | 313.7 | 465.8 |
| Equity | 185.5 | 436.4 | 91.0 | 384.9 |
| Liabilities | 406.9 | 267.9 | 222.7 | 80.9 |
| Profit (loss) for the period | 37.9 | 239.5 | (5.3) | 299.1 |
| Attributable to equity holders of the parent company | 29.9 | 233.7 | (5.3) | 299.1 |
detailed in 19 slide
Invalda
Equity and liabilities
| Invalda AB, mLTL | 2010
9 months | 2011
9 months |
| --- | --- | --- |
| Equity | 91.0 | 384.9 |
| Liabilities to financial institutions | 139.4 | 1.7 |
| from this long term | 95.4 | - |
| Liabilities to group companies | 45.5 | 0.2 |
| Bonds | 32.4 | 33.2 |
| Provision for a possible price reduction | - | 42.5 |
| Other liabilities | 5.4 | 3.3 |
| Total liabilities | 222.7 | 80.9 |
| Total equity and liabilities | 313.7 | 465.8 |
Invalda
Invalda AB detailing assets (book value)
| Asset | Book value 30-09-2011mLTL | Description |
|---|---|---|
| Furniture manufacturing | 14 | 72.14 percent stake in Vilniaus Baldai, the stock price value 91 mLTL (26.4 mEUR) |
| Real estate | 147 | Investments to the real estate and loans granted to the sector companies |
| Rail and road construction | 33 | 12.5 percent stake in Trakcja – Tiltra |
| IT infrastructure sector | 9 | 80 percent stake in BAIP Group and loans granted |
| Facility management | 8 | 100 percent stake in Inreal Pastatu Prieziura, Priemiestis and Jurita and loans granted to the sector companies |
| Other investments | 37 | Investments into Umega, Vernitas shares and other assets |
| Bonds in Trakcja – Tiltra | 43 | Bonds in Trakcja – Tiltra, which can be liability settled on a price reduction |
| Deferred income tax assets | 19 | Deferred income tax assets |
| Cash, deposits, short-term loans and investments | 156 | Cash, deposits, other financial investments |
| Total assets | 466 |
Results
Invalida
- Group sectors and financial investments impact to the profit (loss) statement of Invalida.
| mLTL | 2010 9 months | 2011 9 months |
|---|---|---|
| Furniture manufacturing | 15.2 | 15.1 |
| Real estate | (0.4) | (2.2) |
| Change in Trakcja-Tiltra stock price | - | (59.3) |
| IT infrastructure sector | (0.9) | (0.7) |
| Facilities management | 0.3 | 1.3 |
| Road construction (sold segment) | 5.8 | 108.2 |
| Pharmaceuticals (sold segment) | 12.2 | 187.5 |
| Other | (2.3) | (16.2) |
| Total | 29.9 | 233.7 |
Furniture manufacturing (Vilniaus baldai AB)
(1)
Invalid.
| mLTL | 2010 9 months | 2011 9 months | Change | Change, % |
|---|---|---|---|---|
| Sales | 141.6 | 179.4 | 37.8 | 26.7 |
| EBITDA | 29.1 | 28.3 | (0.8) | (2.7) |
| Net profit | 21.1 | 20.9 | (0.2) | (0.9) |
| Capitalization | 87.6 | 126.1 | 38.5 | 43.9 |
- Shares of Vilniaus Baldai are listed on NASDAQ OMX Vilnius stock exchange.
Turnover and share price of Vilniaus Baldai AB, EUR
More information about company's activities and results are provided on www.vilniausbaldai.lt
Furniture manufacturing (Vilniaus Baldai AB) (2)
23
Invalda
Trends
Increased sales offset the decline in margins on the rising prices of raw materials.
The company generated stable cash flows from its activities.
15.5 mLTL (4.5 mEUR) allocated for dividends, which is 4 LTL (1.2 EUR) per share.
Furniture manufacturing sector of Invalda group
Real estate sector
(1)
3
Invalida
Valuation is made at the end of the year.
| mLTL | 2010
9 months | 2011
9 months |
| --- | --- | --- |
| Value of real estate | 247.4 | 260.7 |
| Shareholders’ equity (incl. loans from Invalida) | 100.4 | 133.3 |
| Loans from credit institutions | 142.8 | 119.7 |
| Rent income | 13.7 | 12.5 |
| from this owned by clients | 3.9 | 3.7 |
| Change of the real estate value | (0.1) | 0.1 |
| Companies’ sale result, allowance and other non-monetary items | 4.5 | 1.4 |
| Result of the real estate sector | 1.9 | (2.2) |
Real estate values
☐ Agricultural land
☑ Residential
☐ For development
☐ Commercial
Real estate sector
(2)
Invalda
Trends
Companies merged into Inreal brand family and updated it (along with facility management sector).
A company Inreal GEO, which will provide cadastral measurements services, was established.
New construction of 17 flats apartment in Vilnius, Valakampiai district, was launched. 10 flats were reserved.
Real estate sector of Invalda group
Information technology sector
(1)
1
Invald:
- Consolidated results of BAIP Group
| mLTL | 2010
9 months | 2011
9 months | Change, mLTL |
| --- | --- | --- | --- |
| Sales | 17.3 | 19.3 | 2.0 |
| Net profit before investments amortization and management costs of options | (0.05) | (0.4) | (0.35) |
| Net profit | (1.1) | (0.9) | 0.2 |
- Eevents:
100 percent shares of Norwegian company Norway Registers Development were acquired for 1.2 mEUR (4.14 mLTL). Also a control over the NRD UAB company, which operates in Lithuania, was taken over.
BAIP designed and introduced at Vilnius University a supercomputer, which will allow scientists to perform a new quality of multidimensional calculations.
BAIP has become the highest level partner of global IT company IBM after the achievement of Premier Business Partner status.
Information technology sector
(2)
1
Invalda
- Changed names of the companies, 2011.
BAIP Group and BAIP changed their names and logos (before that BAIP Group was called Positor and BAIP - Baltic Amadeus Infrastrukturoos Paslaugos). This change is a planned action by which one of the provisions of company acquisition is implemented according to which the company was obliged within a defined period of time to change its name and logo. In 2007, Baltic Amadeus UAB detached its infrastructure business into a separate company called Baltic Amadeus Infrastrukturoos Paslaugos UAB and sold it to Positor group.
IT sector of Invalda Group
Rail and road infrastructure
(1)
H
Invalda
- Trakcja - Tiltra shares are listed on Warsaw Stock Exchange.
During the first half of 2011, Invalda Group recorded 59.3 mLTL (17.2 mEUR) loss due to declining stock price of Trakcja-Tiltra (shares are valued at closing price on 30 September 2011 in Warsaw Stock Exchange).
Rail and road infrastructure
(2)
Invalda
Results
Revenues of Trakcja – Tiltra during nine months were 1.395 billion PLN and the net profit was 14.8 million PLN.
At the end of the third quarter the group orders portfolio amounted to 4.366 billion PLN.
Invalda owns 12.5 percent Trakcja - Tiltra shares which are listed on the Warsaw Stock Exchange.
29
Facility management sector
(1)
30
Factory
Sector's results
From 1 quarter 2011 facility management sector is determined as separate sector in the financial statements of Invalda.
The group didn't own Priemiestis and Jurita during the 9 months of 2010.
| mLTL | 2010
9 months | 2011
9 months | Change |
| --- | --- | --- | --- |
| Sales | 5.4 | 7.2 | 1.8 |
| EBITDA | 0.4 | 0.8 | 0.4 |
| Net profit, without an assessment of one-time events | 0.3 | 0.2 | (0.1) |
| Net profit | 0.3 | 1.3 | 1.0 |
Facility management sector
(2)
31
Invalida
- Main events
In August 2011 Jurita company, supervising houses in Justiniskes, was acquired for 2.5 mLTL (0.7 mEUR) from Vilnius City Municipality.
Invalida Service changed its name to Inreal Pastatu Prieziura - at the same time the company joined a renewed Inreal brand family. Inreal group is the first and still the only provider of a wide range of real estate and facility management services.
Facility management sector of Invalida group
Disclaimer
Invalda
The presentation was prepared by Invalda AB. The following information was used for the preparation:
- Consolidated and Company's financial statements of Invalda for 9 months of 2010;
- Consolidated and Company's financial statements of Invalda for 9 months of 2011.
Data provided here is for information purpose only.
The information provided here is not a recommendation or solicitation to buy or sell any securities of Invalda AB or companies related to Invalda AB.
-
Invalda AB does not take responsibility for the actions any third parties make based only on information provided here.
-
Group composition charts are simplified. Presented owned shares including shares sold under repurchase agreements. Invalda AB owns 100% in the companies if not stated otherwise.
-
Invalda its investments into furniture manufacturing and IT sectors measure at acquisition costs. Investment properties of the real estate sector are measured at fair value. Shares of the rail and road infrastructure company Trakcja-Tiltra are measured according to their price on Warsaw stock exchange.
-
Since 22 November 2010, shares of the listed companies are traded only in EUR on NASDAQ OMX Vilnius stock exchange, therefore all information related to the securities trading is provided in EUR.
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Invalida
Thank you!