Full Year 2023 Petershill Partners PLC Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: David McCann - Numis Securities Ltd. - Analyst : Yeah. Good morning, everyone. Thanks for that -- free technical one for me and one more strategic one. Especially on the technicals, the other OpEx like it fell, so about $2 million year on year and was only took $3 million in the second half versus $8 million in the first half. What was that and kind of what is the outlook for that line item? Secondly, effective tax rate. It moved obviously around quite a bit half-on-half. Obviously quite high in the first half, lower in the second. Can you just update the guidance of $0.12 to $0.14 still stands looking forward? And is there anything particular to call out within the movements in the REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 26, 2024 / 9:00AM, PHLL.L - Full Year 2023 Petershill Partners PLC Earnings Call year that's just gone? Yeah. Looking at the balance sheet, it looks like the divestments, the accrual has more than doubled when the portfolio values have obviously stayed broadly stable. What's driven that? And then on the more strategic one for you. Adam just touched on it at the end of the guidance range of PRE is quite wide for the current year. I mean, is this a signal that you're hoping and maybe expect in the private market industry to see recovery in deals? Obviously, get done this year. And if that is the case, that should obviously point towards the upper end of that band, but obviously reflecting that, that might not happen. There could be some roadblocks ahead and therefore 15 centers obviously in there. Just maybe some color around the signaling as to what that's meant to be showing would be useful. Thank you.

Question: Angeliki Bairaktari - JPMorgan - Analyst : Good morning, and thank you for taking my questions. Out of the $20 billion to $25 billion of fundraising fee-eligible AUM raised that you're targeting for this year, can you tell us how many firms are expected to contribute to that number, to this range? Because I think you mentioned in your release that 18 firms contributed to the raise in 2023. So I was just wondering whether we should expect a similar number or perhaps a smaller number for 2024. And then with regards to consolidation in the industry, you did touch upon that a little bit in your opening remarks and we do hear more and more larger and higher private market managers sort of acquiring smaller firms. In particular, either in the infrastructure or the private debt space. So I was wondering, you obviously own quite a lot of those mid-cap firms that could become potential targets. Have you seen any increase in intensity of approaches from potential buyers for these kind of assets, and would you consider exiting perhaps some of your minority stakes in those firms? Thank you.

Question: Angeliki Bairaktari - JPMorgan - Analyst : Thank you. And if I may follow up, just on the fundraising point, I think, perhaps, there was a second half of last year. I remember there were some press articles about Clearlake launching its next vintage. Is there anything you can share on whether there is -- whether that vintage has actually now been launched and is currently in fundraising?

Question: Angeliki Bairaktari - JPMorgan - Analyst : Thank you.

Question: Andrew Shepherd-Barron - Peel Hunt - Analyst : Good morning, thank you. Just a couple from me, maybe three. First is on the share buyback. Do I take it that all the buybacks and the capital returns to date have been from those shareholders who took it in the IPO or has subsequently acquired rather than anybody holding through Goldman Sachs, and what is the $100 million due? Would that also be likely to only come out of the free float? Because, obviously, you were looking forward to 2026 when things might or might not resolve -- any color on that would be great. Second question from me is on secondary transactions. Obviously, you bought it at a discount, that deal you talked about. Have there been any secondary transactions in firms where you have a participation, which you didn't participate in? Thanks. And actually, a third one for me, if I may, which is, I think that if I look at your valuations in terms of sort of EBITDA multiples are still above what we see in the public market for some non-large leaders. Could you make any comment about that, and why that would be? Thank you.

Question: Andrew Shepherd-Barron - Peel Hunt - Analyst : That you haven't participated in?

Question: Andrew Shepherd-Barron - Peel Hunt - Analyst : Okay, thank you very much.

Question: David McCann - Numis Securities Ltd. - Analyst : Yeah. Sorry to ask another one, just actually a follow-up on one of Andrew's questions. Just on the discount rates slightly falling across the board not all of them, but some of the key ones. And again, some of the multiples slightly increasing in the categories. I mean, you mentioned there, Adam, 40% increase observed in public market comps in terms of multiples, was that the main driver of those aggregate changes? Was there anything sort of mix related you might want to draw out in there, what impacted the underlyings of US Treasury discount rates playing that and indeed, anything else that's relevant? Thank you.

Question: Andrew Shepherd-Barron - Peel Hunt - Analyst : I figured if David is going to have another go, so might I -- excuse me, but just a quickie. On the tax rate, I don't think I quite understood that there was a sort of significantly lower tax rate on how PRE versus FRE. So it's not going to carry on. Is that under threat at all? Should we just naturally assume that the -- obviously, you've talked about the blended tax rate, but the individual -- the breakdown in terms of percentage will carry on for, let's say, the next three to five years, something like that? Thank you.

Question: Andrew Shepherd-Barron - Peel Hunt - Analyst : Okay, thank you.

Question: David McCann - Numis Securities Ltd. - Analyst : Yeah, sorry. (inaudible) another follow-up is actually on -- Andrew's indirectly my involvement on levels of attachment again. So just to complete the picture, you've obviously given us some indications that the effort in FRE and PRE, but what about your own expenses? Should we assume that that's close to 25% rate? And the base of investment income, is that close to the PRE rate? And the half year and last year when we were talking about the tax rate, again, on the company when there was an unexpected large amount was a reference to levels of $31 million, more or less fixed tax receivables agreement accrue within the meaning for the tax rate. So these percentage rates quoted, are they inclusive or exclusive of that TRA $31 million that you referred to in the past? Just so we can come about because I think you had at least a little bit uncertain, I guess for the other, there's a few bits and pieces out there. If you could go down on it again. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 26, 2024 / 9:00AM, PHLL.L - Full Year 2023 Petershill Partners PLC Earnings Call

Question: David McCann - Numis Securities Ltd. - Analyst : Thank you.