REG - Petershill Prtnrs - Q1 Trading Update

Petershill PartnersAnnouncement

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RNS Number : 6841J  Petershill Partners PLC  22 May 2025

Petershill Partners plc (the "Company" or "Petershill Partners") today
publishes its Q1 trading update for the quarter ended 31 March 2025

Gross Fee-eligible AuM raise of $7 billion for the quarter

Highlights

•     Aggregate Partner-firm AuM of $339bn, increasing 1% during the
first quarter and 9% year-over-year.

•     Aggregate Fee-paying Partner-firm AuM of $234bn, decreasing (2%)
during the quarter and increasing 4% year-over-year, impacted by the disposal
of General Catalyst during the quarter.

-     Organic gross Fee-eligible AuM raised was $7bn for the quarter.

•     In the first quarter, Partner Fee-Related Earnings (FRE) were
$45m, (12)% lower than in Q1 2024 reflecting Net Management and Advisory Fees
of $90m, (3)% lower than Q1 2024 and Partner Fee-Related Expenses of ($45m),
7% higher than in Q1 2024.

-     Adjusted for the disposals of General Catalyst and LMR Partners, FRE
increased 12% compared to Q1 2024, Net Management and Advisory Fees increased
13% and Partner Fee-Related Expenses increased 14%. Excluding non-recurring
Partner Fee-Related Expenses in the quarter of around $1m, the increase was
11%.

-     Management fees in Q1 2025 were $93m, (3)% lower than in Q1 2024.
Adjusted for the disposals of General Catalyst and LMR Partners, Management
fees increased 14%.

-     There were no Transaction and Advisory Fees in Q1 2025 and Q1 2024,
and Offsets in Q1 2025 were ($3m) similar to Q1 2024.

•     Partner Distributable Earnings were $73m, 28% higher than in Q1
2024, reflecting higher Partner Realised Performance Revenues (PRE) of $26m,
including $19m relating to assets disposed ($3m, Q1 2024) and modestly lower
Partner Realised Investment Income of $2m ($3m, Q1 2024).

•     Transaction activity during Q1 2025 included the Company
completing the sale of the majority of its stake in General Catalyst for total
nominal consideration of $726m, representing a 62% premium to the last
reported carrying value of the interests sold prior to the disposal. The
Company also acquired a stake in Frazier Healthcare Partners for $330m.
Frazier is a healthcare specialist private equity firm with $5.5bn in AuM.

•     We re-iterate our 2025 guidance as provided at our full year
results on 31 March 2025.

 

Statement from Ali Raissi-Dehkordy and Robert Hamilton Kelly

"During the first three months of 2025, our Partner-firms' continued to
experience steady fund-raising activity with $7bn of gross fee eligible assets
raised.  Underlying financial performance from our Partner-firms, adjusted
for disposals, continued to deliver double digit FRE growth. Strategically, we
had an active start to the year, completing the sale of the majority of our
stake in General Catalyst and returning $151m from the initial proceeds
through a special dividend. We also completed the acquisition of a stake in
Frazier Healthcare Partners, consistent with our strategy of focusing on
alternative private market firms. Economic uncertainty increased in recent
months and the outlook for capital markets activity and investor sentiment
remains unclear, but our Partner-firms' robust capital raising and the
Company's dynamic approach to capital allocation underpin our ongoing
confidence in delivering for our shareholders."

 

AuM Development: Q1 2025

The following table summarises the changes in Aggregate Partner-firm AuM,
Aggregate Fee-paying Partner-firm AuM and Ownership Weighted values for the
quarter ended and the nine-month period ended 31 March 2025.

All AuM figures are based on a one-period (3-month) lag:

 

 

 

 

AuM Reconciliation: Aggregate Fee-paying AuM Vs Aggregate Partner-firm AuM

The below table reconciles Aggregate Fee-paying Partner-firm AuM to Aggregate
Partner-firm AuM as at 31 March 2025, based on a one-period (3-month) lag:

 

The following table reflects the Aggregate Partner-firm AuM, Aggregate
Fee-paying Partner-firm AuM and Ownership Weighted Fee-paying AuM by Asset
Class as of 31 March 2025, based on a one-period (3-month) lag:

 

2025 Guidance

•     $20 - $25bn organic fee-eligible AuM raise and realisations of $5
- $10bn in fee-paying AuM.

•     $180 - $210m full year Partner FRE. 2024 pro-forma FRE of
$186m(.1)

•     PRE of 15% - 30% of total Partner Revenues.

•     Acquisitions in 2025 expected to be above the medium-term range of
$100 - $300m per annum.

•     85% - 90% Company Adjusted EBIT margin.

 

 

 

Contact Information

 

Please direct any questions to Petershill Partners Investor Relations, via
e-mail, at PHP-InvestorEnquiries@gs.com

Analyst / Investor enquiries:

Gurjit Kambo
 
 
+44 (0) 207 051 2564

 

Media enquiries:

Brunswick Group
 
 
phll@brunswickgroup.com

Simone Selzer
 
 
                     +44 (0) 207 404 5959

 

 

 

Petershill Partners will provide a Q2 2025 AuM update on 22 July 2025

 

 

ABOUT PETERSHILL PARTNERS

Petershill Partners plc (the "Company" or "Petershill Partners") and its
Subsidiaries (the "Group") is a diversified, global alternatives investment
group focused on private equity and other private capital strategies. Through
our economic interests in a portfolio of alternative asset management firms
("Partner-firms"), we provide investors with exposure to the growth and
profitability of the alternative asset management industry. The Company
completed its initial acquisition of the portfolio of Partner-firms on 28
September 2021 and was admitted to listing and trading on the London Stock
Exchange on 1 October 2021 (ticker: PHLL). The Company is operated by Goldman
Sachs Asset Management ("Goldman Sachs" or the "Operator") and is governed by
a diverse and fully independent Board of Directors (the "Board").

 

Through our Partner-firms, we have exposure to $339 billion of Aggregate
Partner-firm AuM, comprising a diverse set of more than 200 long-term private
equity and other private capital funds where capital is typically locked in
over a multi-year horizon. These underlying funds generate recurring
management fees and the opportunity for meaningful profit participation over
the typical 9+ years lifecycles of such funds. We believe our approach is
aligned with the founders and managers of our Partner-firms and, as a result,
allows the Company to participate in these income streams in a way that
provides high-margin, diversified and stable cash flows for our
shareholders.

 

For more information, visit https://www.petershillpartners.com
(https://www.petershillpartners.com/) . (https://www.petershillpartners.com/)
Information on the website is not incorporated by reference into this press
release and is provided merely for convenience.

 

 

 

 

 1. Pro-forma 2024 FRE adjusted for the impact of the disposal of LMR,
partial disposals of AKKR and the sale of the majority of the stake in General
Catalyst.

Key Operating Metrics - Definitions

 

This document contains certain key operating metrics that are not defined or
recognised under IFRS.

The Operator and the Directors use key operating metrics to help evaluate
trends, assess the performance of the Partner-firms and the Company, analyse
and test dividends received from the Partner-firms and inform operating,
budgeting and reinvestment decisions. The Directors believe that these
metrics, which present certain operating and other information in respect of
the Partner- firms, provide an enhanced understanding of the underlying
portfolios and performance of the Partner-firms and are therefore essential to
assessing the investments and performance of the Company.

The key operating metrics described in this section are derived from financial
and other information reported to the Operator by the Partner-firms. The
Operator, with the assistance of an independent accounting firm, performs due
diligence procedures on the information provided by the Partner-firms. It
should be noted, however, that these due diligence procedures do not
constitute an audit.

In addition, each Partner-firm may account for and define certain financial
and other information differently from one another. For example, each
Partner-firm may calculate its fee-paying AuM differently, the result of which
being that the inputs of the Company's Aggregate Fee-paying AuM are not
consistently calculated.

Whilst the operating metrics described in this section are similar to those
used by other alternative asset managers, there are no generally accepted
principles governing their calculation, and the criteria upon which these
metrics are based can vary from firm to firm. These metrics, by themselves, do
not provide a sufficient basis to compare the Partner-firms' or the Company's
performance with that of other companies.

None of Partner Distributable Earnings, Partner FRE, Partner Realised
Performance Revenues or Partner Realised Investment Income are measures of or
provide any indication of profits available for the purpose of a distribution
by the Company within the meaning of section 830 of the Companies Act 2006, or
of any Partner-firm in accordance with the equivalent applicable rules.

Aggregate Partner-firm AuM

Aggregate Partner-firm AuM is defined as the sum of (a) the net asset value of
the Partner-firms' underlying funds and investment vehicles, and in most cases
includes co-investment vehicles, GP commitments and other non fee-paying
investment vehicles and (b) uncalled commitments from these entities, as
reported by the Partner-firms to the Operator from time to time and aggregated
by the Operator without material adjustment. This is an aggregated figure
across all Partner-firms and includes Partner-firm AuM outside of the
Company's ownership interest in the Partner-firms.

The Operator and the Directors consider Aggregate Partner-firm AuM to be a
meaningful measure of the size, scope and composition of the Partner-firms, as
well as of their capital-raising activities. The Operator uses Aggregate
Partner-firm AuM to inform operating, budgeting and reinvestment decisions.

Ownership weighted AuM

Ownership weighted AuM represents the sum of the Company's ownership stakes in
each Partner-firm's AuM.

Aggregate Fee-paying AuM

Aggregate Fee-paying AuM is defined as the portion of Aggregate Partner-firm
AuM for which Partner-firms are entitled to receive management fees, as
reported by the Partner-firms to the Operator. The principal difference
between Aggregate Fee-paying AuM and Aggregate Partner-firm AuM is that
Aggregate Fee-paying AuM typically excludes co-investment on which Partner-
firms generally do not charge fees and, to a lesser extent, fund commitments
in Partner-firm funds (i) on which fees are only earned on investment, rather
than from the point of commitment and (ii) where capital has been raised but
fees have not yet been activated. This may also include legacy assets where
fees are no longer being charged.

The Operator and the Directors consider Aggregate Fee-paying AuM to be a
meaningful measure of the Partner-firms' capital base upon which they earn
management fees and use the measure in assessing the management fee-related
performance of the Partner-firms and to inform operating, budgeting and
reinvestment decisions.

Ownership weighted Fee-paying AuM

Ownership weighted Fee-paying AuM represents the sum of the Company's
ownership stakes in each Partner-firm's Fee-paying AuM.

Aggregate Performance Fee Eligible Partner-firm AuM

The amount of Aggregate Partner-firm AuM that is eligible for performance
fees.

Partner Net Management and Advisory Fees

Partner Net Management and Advisory Fees is defined as the Company's aggregate
proportionate share of the Partner-firms' net management fees (as reported by
the Partner-firms to the Operator), including monitoring and advisory fees and
less any management fee offsets, payable by the Partner-firms' funds to their
respective Partner-firms for the provision of investment management and
advisory services.

Certain Partner-firms provide transaction and advisory services, as well as
services to monitor ongoing operations of portfolio companies. Management fees
paid to the Partner-firms may be subject to fee offsets, which are reductions
to management fees and are based on a percentage of monitoring fees and
transaction and advisory fees paid by portfolio companies to the
Partner-firms.

The Operator and the Directors consider Partner Net Management and Advisory
Fees to be a meaningful measure of the management fee-related performance of
the Partner-firms, and the Operator uses this metric to analyse and test
income received from the Partner-firms and to inform operating, budgeting and
reinvestment decisions.

Partner Fee Related Earnings (FRE) and Partner FRE Margin

Partner FRE is defined as Partner Net Management and Advisory Fees, less the
Partner-firms' operating expenses, fixed and bonus compensation, net interest
income/(expense) and taxes (but not performance fee-related expenses)
allocable to the Company's share of Partner Net Management and Advisory Fees,
as reported by the Partner-firms to the Operator, and subject to applicable
contractual margin protections in respect of certain Partner-firms. Partner
FRE Margin is defined as Partner FRE divided by Partner Net Management and
Advisory Fees.

The Operator and the Directors consider Partner FRE and Partner FRE Margin to
be meaningful measures of the management fee-related earnings of the
Partner-firms and key performance indicators of the Company's income from
investments in management companies derived from management fee income. The
Operator uses this metric to analyse and test dividends received from the
Partner-firms, as well as to inform operating, budgeting and reinvestment
decisions.

Partner Realised Performance Revenues (PRE)

Partner Realised Performance Revenues is defined as the Company's aggregate
proportionate share of the Partner-firms' realised carried interest
allocations and incentive fees payable by the Partner-firms' funds to their
respective Partner-firms, less any realised performance fee-related expenses
of the Partner-firms allocable to the Company's share of performance
fee-related revenues, as reported by the Partner-firms to the Operator.

The Company's share of the Partner-firms' performance fee-related earnings
will be lower than its share of the Partner-firms' management fee-related
earnings because the Company's ownership stake in the Partner-firms'
performance fee-related earnings is lower than its ownership stake in the
Partner-firms' management fee-related earnings.

The Operator and the Directors consider Partner Realised Performance Revenues
to be a meaningful measure of the performance fee-related earnings of the
Partner-firms and key performance indicator of the Company's income from
investments in management companies derived from performance fee income. The
Operator uses this metric to analyse and test dividends received from the
Partner-firms, as well as to inform operating, budgeting and reinvestment
decisions.

Partner Realised Investment Income

Partner Realised Investment Income is defined as the Company's aggregate
proportionate share of Partner-firm earnings resulting from the realised gains
and losses, or any distributed income, from the investments held on
Partner-firms' balance sheets, as reported by the Partner-firms to the
Operator. Partner Realised Investment Income is also realised by the Company
through a limited number of direct stakes in certain Partner-firms' funds.
Realised Investment Income includes income that has been realised but not yet
paid, as well as amounts that are realised and either fully or partially
reinvested.

The Company's share of the Partner-firms' investment and balance sheet income
will be lower than its share of the Partner-firms' management fee-related
earnings because the Company's ownership stake in the Partner-firms'
investment and balance sheet income is lower than its ownership stake in the
Partner- firms' management fee-related earnings.

The Operator and the Directors consider Partner Realised Investment Income to
be a meaningful measure of the investment performance of certain assets held
by the Partner-firms and key performance indicator of the Company's income
from investments in management companies derived from investment income. The
Operator uses this metric to analyse and test dividends received from the
Partner-firms, as well as to inform operating, budgeting and reinvestment
decisions.

Partner Distributable Earnings and Partner Distributable Earnings Margin

Partner Distributable Earnings is defined as the sum of Partner FRE, Partner
Realised Performance Revenues and Partner Realised Investment Income. Partner
Distributable Earnings Margin is defined as Partner Distributable Earnings
divided by the sum of Partner Net Management and Advisory Fees, Partner
Realised Performance Revenues and Partner Realised Investment Income.

The Operator and the Directors consider Partner Distributable Earnings and
Partner Distributable Earnings Margin to be meaningful measures of the overall
performance of the Partner-firms and key performance indicators of the
Company's total income from investments in management companies. The Operator
uses this metric to analyse and test dividends received from the
Partner-firms, as well as to inform operating, budgeting and reinvestment
decisions. These measures reflect any contractual margin protections or
revenue share interests that the Company may have with the Partner-firms,
which means that the Partner Distributable Earnings Margin may differ from the
margins achieved by other Shareholders or partners of the Partner-firms.

Partner Revenues

Partner Revenues is defined as the sum of Partner Net Management and Advisory
Fees, Partner Realised Performance Revenues and Partner Realised Investment
Income.

The Operator and the Directors consider Partner Revenues to be a meaningful
measure of the overall performance of the Partner-firms. The Operator uses
this metric to inform operating, budgeting and reinvestment decisions.

 

 

AuM and Associated Data

The data presented in this document for the following key operating metrics
reflects AuM data reported to the Operator on a three-month lag. This
three-month data lag is due to the timing of the financial information
received by the Operator from the Partner-firms, which generally require at
least 90 days following each period end to present final financial information
to the Operator. The key operating metrics reflected on a three-month lag are:

•           Aggregate Partner-firm AuM

•           Aggregate Fee-paying Partner-firm AuM

•           Average Aggregate Fee-paying Partner-firm AuM

•           Aggregate Performance Fee Eligible Partner-firm AuM

•           Average Aggregate Performance Fee Eligible
Partner-firm AuM

•           Partner Blended Net Management Fee Rate

•           Implied Blended Partner-firm FRE Ownership

•           Investment Capital

 

 

This announcement has been prepared solely to provide additional information
to shareholders and meets the relevant requirements of the Disclosure Guidance
and Transparency Rules of the Financial Conduct Authority. The announcement
should not be relied on by any other party or for any other purpose.

These written materials are not an offer of securities for sale in the United
States. Securities may not be offered or sold in the United States absent
registration under the US Securities Act of 1933, as amended, or an exemption
therefrom. The issuer has not and does not intend to register any securities
under the US Securities Act of 1933, as amended, and does not intend to offer
any securities to the public in the United States. Any securities of
Petershill Partners plc referred to herein have not been and will not be
registered under the US Investment Company Act of 1940, as amended, and may
not be offered or sold in the United States or to "U.S. persons" (as defined
in Regulation S under the US Securities Act of 1933, as amended) other than to
"qualified purchasers" as defined in the US Investment Company Act of 1940, as
amended. No money, securities or other consideration from any person inside
the United States is being solicited and, if sent in response to the
information contained in these written materials, will not be accepted.

FORWARD-LOOKING STATEMENTS

This press release may contain forward-looking statements that involve
substantial risks and uncertainties. You can identify these statements by the
use of forward-looking terminology such as "may," "will," "should," "expect,"
"anticipate," "project," "target," "estimate," "intend," "continue," or
"believe" or the negatives thereof or other variations thereon or comparable
terminology. You should read statements that contain these words carefully
because they discuss our plans, strategies, prospects and expectations
concerning the business, operating results, financial condition and other
similar matters. These statements represent the Company's belief regarding
future events that, by their nature, are uncertain and outside of the
Company's control. There are likely to be events in the future, however, that
we are not able to predict accurately or control. Any forward-looking
statement made by us in this press release is based upon information known to
the Company on the date of this press release and speaks only as of such date.
Accordingly, no assurance can be given that any particular expectation will be
met, and readers are cautioned not to place undue reliance on forward looking
statements. Additionally, forward looking statements regarding past trends or
activities should not be taken as a representation that such trends or
activities will continue in the future. Other than in accordance with its
legal or regulatory obligations (including under the UK Listing Rules and the
Disclosure Guidance and Transparency Rules of the Financial Conduct
Authority), the Company undertakes no obligation to publicly update or revise
any forward-looking statement, whether as a result of new information, future
events or otherwise.

 

 

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