Intermediate Capital Group PLC Half Year Results 30 September 2010 Authorised and regulated by the Financial Services Authority
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Highlights • Operational highlights • Strong realisations; £150m of repayments; £87m of capital gains • £437m** of new investments; £128m** for the Investment Company • AUM of €11,671m vs €11,191m at 31/03/10 • Financial highlights • FMC Profit before tax: £16.9m vs £15.2m in H2 10 • IC Profit before tax*: £88.2m vs £82.5m in H2 10 • Group Profit before tax*: £105.1m vs £97.7m • Interim dividend of 6 pence unchanged from last year * Including £8.5m, impact of fair value movements on derivatives held for hedging purposes (H2 10: loss of £7.5m) ** Excluding the syndicated portion of the EOS Loan Fund 1 Intermediate Capital Group PLC 3
Strategic priorities • Manage our portfolio to maximise value • Invest selectively • Grow our Fund Management Company Intermediate Capital Group PLC 4
LBO Market Update
European LBO Volume Primary LBOs Secondary LBOs 180 160 140 120 100 €bn 80 60 40 20 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1 - Q3 2010 Source: S&P, 30 September 2010 Intermediate Capital Group PLC 6
European High Yield Issuance 35 30 25 20 €bn 15 10 5 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1 - Q3 2010 Source: S&P, 30 September 2010 Intermediate Capital Group PLC 7
European Loan Prices Loan Market Flow Names 104 100 96 92 88 84 80 76 72 68 64 60 56 52 3 4 5 6 7 8 9 0 2 3 3 3 4 4 4 5 5 5 6 6 6 7 7 7 8 8 8 9 9 9 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 0 0 0 0 0 0 0 0 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - c r n p c r n p c r n p c r n p c r n p c r n p c r n p c r n p a a a a a a a a u u u u u u u u e e e e e e e e e e e e e e e e M M M M M M M M D J S D J S D J S D J S D J S D J S D J S D J S Source: S&P Intermediate Capital Group PLC 8
European Private Equity Drypowder Funds raised Dry Powder 250 200 150 €bn 100 50 0 2005 2006 2007 2008 2009 Q1 - Q3 2010 Source: Preqin, 30 September 2010 Intermediate Capital Group PLC 9
European LBO Average Purchase Price Multiple of EBITDA (6 months moving average) 11 10 9 8 7 6 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Source: S&P Intermediate Capital Group PLC 10
European Gearing Total Debt/EBITDA for European LBOs 7x 5.94x 6x 5.43x 5.17x 5.1x 5x 4.69x 4.54x 4.24x 4.26x 4.11x 4.04x 4x 4.12x 4.12x 3x 2x 1x 0x 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1 - Q3 2010 Source: S&P Intermediate Capital Group PLC 11
European Refinancing Gap €70 €60 €50 Amount (€B) €40 €30 €20 €10 €0 2010 2011 2012 2013 2014 2015 2016 2017 Year European CLOs Total Funded Amount by End of Reinvestment Period European Maturing LBO Senior Debt Source: October 2010, JPMorgan Structured Finance Research, INTEX, S&P European Leveraged Loan Index (ELLI) Intermediate Capital Group PLC 12
US LBO Volume 434 430 180 233 230 160 140 233 120 100 434 $bn 80 60 40 20 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 Q1 - Q3 2010 Source: S&P Intermediate Capital Group PLC 13
Asia Pacific LBO Market • Growth prospects make market attractive to all • Secondary market supporting dynamic primary market • Local banks are well capitalised • ICG well positioned but cautious given valuations Intermediate Capital Group PLC 14
Realisations and Investments
New Lending vs Repayments* 1400 New Lending Repayments 1200 1000 800 £m 600 400 200 0 Mar- Jun- Sep- Dec- Mar- Jun- Sep- Dec- Mar- Jun- Sep- Dec- Mar- Jun- Sep- Dec- Mar- Jun- Sep- Dec- Mar- Jun- Sep- 05 05 05 05 06 06 06 06 07 07 07 07 08 08 08 08 09 09 09 09 10 10 10 *6 months moving average Intermediate Capital Group PLC 16
Exits • Market remains a seller’s market • £150m of repayments* in H1 11 • £86.8m of capital gains in H1 11 • Geoservices • Sebia • Pasteur Cerba • TeamSystem • Picard • Visma • £374m of repayments* and £186m of capital gains since 31 March 2009 • Well above initial objective of circa £400m for FY10-FY11 * Excludes Picard and Visma due to complete in H2 Intermediate Capital Group PLC 17
New Investments • £128m of new investments • TeamSystem • Fort Dearborn • Eos Loan Fund 1 • £150m-£200m investment guidance for FY11 unchanged • Cautious approach to investments Intermediate Capital Group PLC 18
Deal Pipeline Deals reviewed to preliminary approval 250 PICA IP Funded 200 Number of Deals 150 100 50 0 Deal Volume CY07 Deal Volume CY08 Deal Volume CY09 Deal Volume CY10 Intermediate Capital Group PLC 19
Portfolio Update
Investment Portfolio Performance vs Prior Year Percentage of assets performing at or above prior year 80% 70% 60% 50% 40% 30% 20% 10% 0% Jun-08 Sep-08 Dec-08 Mar-09 Jun-09 Sep-09 Dec-09 Mar-10 Jun-10 Sep-10 Intermediate Capital Group PLC 21
Trend in Provisions for Portfolio Companies Gross Provisions Write-backs 250 200 150 £m 100 50 0 H1 08 H2 08 H1 09 H2 09 H1 10 H2 10 H1 11 Intermediate Capital Group PLC 22
Fund Management
Third Party Funds Under Management 10 9 8 7 6 €bn 5 4 3 2 1 0 FY 00 FY 01 FY 02 FY 03 FY 04 FY 05 FY 06 FY 07 FY08 FY09 FY10 H1 11 Mezzanine Funds CFM Funds Intermediate Capital Group PLC 24
Eos Loan Fund 1 • 71 Western European loans, all performing loans • €1.4bn of par value • €841m of debt secured from third party; • Equity from RF 08, EF 06, third party investors and IC (€48.5m) • AUM contribution of €902m Intermediate Capital Group PLC 25
Fund Management Outlook • ICG Europe V • High Yield • CDO consolidation • Adjacent asset classes Intermediate Capital Group PLC 26
Financial Review
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