Profit warning 2012/13

Company announcement no 1 2013/14
Copenhagen 4 March 2013

SPEAS revises down expectations for the financial year 2012/13 and forecasts a profit of DKK 9m-14m
SPEAS now forecasts a profit in the range of DKK 9m-14m for the financial year ending on 31 January 2013. The previous forecast was DKK 55m-65m.

At this date, the private equity funds have reported to SPEAS on the majority of SPEAS’s private equity investments. On that basis, SPEAS expects a loss for Q4 of the financial year.

Seen across the part of the portfolio for which SPEAS has received reports, portfolio company earnings generally increased in Q4/2012 despite the macroeconomic downturn in Europe. This confirms that the long-term value creation in the portfolio companies is intact.

However, the current situation is that the private equity funds wrote down the aggregate value of the portfolio companies by 3-4% in Q4/2012. A few portfolio companies which are particularly hard hit by market- and/or company-specific conditions represent the greater part of the impairment losses, while revaluations and impairment losses of the other portfolio companies are largely evenly distributed.

At 31 January 2013, SPEAS’s investments in private equity funds are estimated at DKK 745m-750m after value adjustments in Q4 of the financial year, and SPEAS’s total investments in private equity funds for FY 2012/13 are expected to yield a positive return of approximately 2% of the average portfolio.

In spite of weak returns in FY 2012/13, the accumulated return on investments in private equity funds until 31 January 2013 is expected to amount to 19%, equal to an annual return of 6.0-6.5% (IRR), which exceeds the return on equivalent investments in the general equity market in the same period.

In FY 2012/13, the private equity funds in which SPEAS invests divested another six portfolio companies. As at 31 January 2013, SPEAS had received exit proceeds from the private equity funds in relation to a total of 13 investments. Exit proceeds total DKK 312m, corresponding to 2.0x the invested amount and gross returns of 16.7% pa (IRR) as at 31 January 2013.

Private equity activity in Europe was lower in 2012 than in the two preceding years. The private equity funds in which SPEAS invests nonetheless maintained a decent activity level and implemented a total of 17 investments in new portfolio companies, confirming their strong network of potential sellers and banks.

Equity is expected to come to DKK 900m-905m at 31 January 2013, equal to DKK 20,000-20,100 per share. The quoted price was DKK 15,860 at 31 January 2013.

The forecast is subject to the final closing and audit of the accounts. The final results may therefore differ from the forecast. SPEAS makes its preliminary announcement of financial statements on 19 April 2013.

For further information, please contact:
Ole Mikkelsen, CEO, tel +45 70 25 10 55, mobile +45 30 66 96 30

2013 01 130304 Profit warning