Half Year 2022 Petershill Partners PLC Earnings Call Transcript

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

Question: Hubert Lam - Bank of America - Analyst : Hi. Good morning. I've got a few questions. Firstly, can you talk about the M&A environment for GP stakes? You've done a deal recently, but you're currently at the low end of the acquisition range. Do you expect more this year and what are valuations like for the GP stakes? Second question is on fundraising guidance. You raised that this year to $50 billion. What type of products and which partner-firms are seeing stronger inflows that led to the higher guidance? And the last question is, given the higher fundraising in 2022, what does this mean for 2023 fundraising? Are they accelerating fundraising near term and should we expect a slower pipeline to next year just because of the front running? Thank you.

Question: Hubert Lam - Bank of America - Analyst : Thanks. And also, any color in terms of the type of products, asset classes that are seeing the stronger inflows that led to the higher guidance?

Question: Hubert Lam - Bank of America - Analyst : All right. Thank you very much.

Question: Arnaud Giblat - BNP Paribas - Analyst : Good morning. I've got one question, please. Could you discuss for us how your financial criteria to do acquisitions might have evolved in light of you using higher discount rates to value your current stakes and in light of the 40% discount to fair value your stock trades on? And more specifically, is there anything you can say about the valuations paid for Kayne Anderson? Thank you.

Question: Arnaud Giblat - BNP Paribas - Analyst : Great. Thanks.

Question: Luke Mason - BNP Paribas - Analyst : Yeah. Morning, guys. Sorry, double hogging the questions there. But just first question, just following up on the M&A theme around capital allocation, I guess with your share is trading at like a 40% discount to book now, how do you think about doing more buybacks in the future? Obviously, you've got the one progressing at the minute. Just thinking around the value creation from buybacks versus doing new deals and the pricing around those. And then just secondly, on the mid-market focus of your firms versus other publicly listed firms, how do you think that compares in terms of deal activity, fundraising of new strategies if they're raising first-time funds? Is that going to be more difficult, just how to think about a comparison versus some of your mid-market firms versus larger listed peers? And then just thirdly, on fund performance of partner-firms, we're not at the end of Q3 yet, but just thinking about valuations of underlying portfolio companies and what are you expecting to see from fund performance in the coming quarters from your partner-firms. Thanks. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 21, 2022 / 8:00AM, PHLL.L - Half Year 2022 Petershill Partners PLC Earnings Call

Question: Luke Mason - BNP Paribas - Analyst : Great. Thanks, guys.

Question: Mike Werner - UBS - Analyst : Thanks, guys. Most of my questions have been asked, but perhaps you could just give us a little bit of color with regards to your absolute return exposure. I know year to date it's been a bit of a tough market for absolute return funds. Obviously, that's speaking a generalization for the industry. So I'm just wondering how your partner-firms within that asset class have performed in the first half or the first eight and a half months. Thanks.

Question: Mike Werner - UBS - Analyst : Thank you.

Question: Yanni Legbelos - Kuwait Investment Authority - Analyst : I have two quick questions for each of you. For Ali, one, I note the upgraded fundraising guidance, but I also noticed that based on the previous quarter were basically flat. So we assume almost $15 billion to be booked in the second half of this year and I guess that includes Francisco Partners funds that closed in July above target. So that's the driver of the updated guidance. And the second question for Ali is the deal that you closed in the summer. I know that you said that is in a private capital firm, but I didn't understand your comment about how much the listed entity participated in that in terms of 20% or more. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 21, 2022 / 8:00AM, PHLL.L - Half Year 2022 Petershill Partners PLC Earnings Call And then the two questions for Rob are the IFRS impairment of assets because of the higher discount rate, why is that, who drives that, and what does that mean accounting-wise or tax-wise going forward? Or do you expect that to reverse, let's say, in the next couple of quarters? And the last question maybe for Rob or either of you is regarding the buyback, what is the trading performance, call it price action, that you are looking for to trigger the rest of it? It's already still accretive to deploy it, and you have 70% left of it for the rest of the year. I know that's a question for the Board, but if you're just talking accounting or accretion, why is it still accretive to do it, if you're looking for a trading signal? That would be interesting to think about as well. Thank you.

Question: Yanni Legbelos - Kuwait Investment Authority - Analyst : Thank you both. That's very clear. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. SEPTEMBER 21, 2022 / 8:00AM, PHLL.L - Half Year 2022 Petershill Partners PLC Earnings Call

Question: David McCann - Numis - Analyst : Yeah. Good morning, everyone. A couple for me. Hardly been answered, but I just wanted a bit more color on both of them. So just on things about the dividends, obviously, in light of the policy of last year to this time. Obviously, notice the progressive policy, just thinking ahead to the year end. I mean, how should we think about the dividend? Is it your intention that the majority of, say, growth or earnings goes to the dividend or is it sort of split or the smaller rise perhaps in the dividend and more coming through the climate? Obviously, partly that's going to be cutting some opportunities depending on share price and other factors, but just some color there. How do you think about that split? And then just to follow up on the portfolio evaluation, interest rates have been mentioned a couple of times in a couple of questions and remarks. If you were to mark to market today based on where rates have been since June, what would happen to the portfolio as of today? Thanks.