STOCKHOLM, Jan. 18, 2024 /PRNewswire/ —
Investment activity reaccelerated in uncertain markets
“In 2023, EQT cemented our global position through the successful integration of BPEA in Asia, delivered on our strategic objective to offer investment strategies tailored for individual investors, and invested with confidence into what we think is an attractive market. We enter our fourth decade primed to build on the first thirty years, continuing to leverage our leadership in areas like sustainability, AI and digitalization for the best of our portfolio, our clients and our shareholders.”
CEO and Managing Partner
Highlights for the period Jan-Dec 2023 (Jan-Dec 2022)
- In 2023, EQT delivered a significant uplift in management fees based on strong fundraising and the full-year effect of the combination with BPEA, whereas carried interest was lower due to slower realizations and largely flat fund valuations. Adjusted margins increased through operational efficiency and scaling effects
- Total revenue (adjusted*) amounted to EUR 2,131m (EUR 1,536m), an increase of 39%. Total revenue (according to IFRS) was EUR 2,084m (EUR 1,497m). Management fees increased by 48%, driven by Private Capital and Infrastructure as well as the full-year contribution of BPEA
- Carried interest and investment income (adjusted*) amounted to EUR 165m (EUR 208m), a decrease of 21%. IFRS carried interest and investment income amounted to EUR 118m (EUR 169m), a decrease of 30%
- EBITDA (adjusted*) amounted to EUR 1,226m (EUR 829m), corresponding to an adjusted margin of 58% (54%). EBITDA (according to IFRS) was EUR 693m (EUR 506m), corresponding to a margin of 33% (34%)
- Fee-related EBITDA (adjusted*) amounted to EUR 1,062m (EUR 621m), corresponding to an adjusted margin of 54% (47%)
- Net income (adjusted*) from continuing operations amounted to EUR 1,019m (EUR 654m). Net income from continuing operations (according to IFRS) was EUR 139m (EUR 176m)
- Basic earnings per share (adjusted*) for continued operations amounted to EUR 0.860 (EUR 0.634). Diluted earnings per share (adjusted*) for continued operations amounted to EUR 0.859 (EUR 0.634). Reported basic earnings per share for continued operations amounted to EUR 0.117 (EUR 0.171). Diluted earnings per share for continued operations amounted to EUR 0.117 (EUR 0.171)
- The integration with BPEA, including the alignment of investment teams and processes, was completed. As of year-end 2023, BPEA EQT was rebranded “EQT Private Capital Asia”, enhancing EQT’s global brand reach
- EQT launched its first semi-liquid products, EQT Nexus and EQRT. EQT Nexus and EQRT represent a new distribution channel for EQT by providing access for individuals to invest in private markets. EQT Nexus provides access to a diversified portfolio of EQT’s funds, and EQRT focuses on direct investments in commercial real estate
- EQT laid the groundwork for a healthcare growth strategy by making strategic hires for its Private Capital Healthcare advisory team, enhancing its expertise in early-stage healthcare investments
- FAUM increased to EUR 130bn (EUR 113bn). Total AUM was EUR 232bn (EUR 210bn). Gross inflows were primarily driven by closed out commitments from EQT X and EQT Infrastructure VI and amounted to EUR 24bn (EUR 55bn, of which over EUR 20bn following the combination with EQT Private Capital Asia)
- EQT Exeter Industrial Value Fund VI held its final close at USD 4.9bn of fee-generating commitments, exceeding its target size of USD 4.0bn
- Fundraising continued for EQT X with fee-generating commitments of EUR 20.1bn as of year-end. EQT X is expected to close at its hard cap in Q1 2024
- As of year-end, EQT Infrastructure VI had fee-generating commitments of EUR 13.7bn. As of today (18 January), the fund has secured commitments of close to EUR 14.5bn. Fundraising is set to continue well into 2024, and the fund is expected to reach its target fund size
- Fundraising continued for EQT Future, EQT Exeter US Multifamily Value II, EQT Exeter Europe Logistics Core-Plus II and EQT Active Core Infrastructure, with fundraisings generally taking longer in the current fundraising environment
- Fundraising continued for BPEA EQT Mid Market Growth, and the hard cap was increased to USD 1.4bn
Investment and exit activity1
- Total investments by the EQT funds during the period amounted to EUR 19bn (EUR 12bn), as EQT reaccelerated the pace of investments to seize opportunities supported by long-term secular growth trends. Infrastructure had its most active investment year ever with EUR 9bn of investments, Private Capital announced investments close to EUR 9bn, and investment volumes in EQT Exeter picked up towards the end of the year with almost EUR 2bn of investments in total for the year
- Investments were primarily made in sectors such as healthcare, technology, and digital. Examples of investments include Dechra Pharmaceuticals, a global developer, manufacturer and supplier of products relating to pets (EQT X), Zeus, a leading supplier of custom polymer components to the world’s most innovative medical device and industrial companies (EQT X), Heritage Environmental Services, a leading provider of industrial waste management (EQT Infrastructure VI), and Indira IVF, India’s largest chain of fertility clinics (BPEA VIII)
- Total gross fund exits announced during the period amounted to EUR 6bn (EUR 11bn)
- All key funds continued to perform On plan or Above plan
- Key fund valuations were for the most part flat on a Gross MOIC basis, and in aggregate, the key fund valuations were up. The portfolio continued to develop well, but with some pockets of underperformance. Revenue growth slowed in Private Equity, offset by margin improvements which drove higher EBITDA growth, and the Infrastructure portfolio remained resilient. Listed companies in EQT’s key funds were down on average
Balance sheet, realization of carried interest and liquidity
- At 31 December 2023, interest bearing liabilities amounted to EUR 2,021m. Cash and cash equivalents amounted to EUR 1,114m, EQT’s EUR 1.5bn revolving credit facility was undrawn, and Net Debt (ND) amounted to EUR 886m. ND/Adjusted EBITDA was 0.7x and ND/Adjusted Fee-related EBITDA 0.8x
- Carried interest (adjusted*) amounted to EUR 142m (EUR 202m). Realized (cash) carried interest amounted to EUR 115m (EUR 190m)
- EQT completed a repurchase of 1.8m shares, with the objective of over time offsetting the dilution impact from EQT’s Incentive Programs
- The number of full-time equivalent employees and on-site consultants (FTE+) amounted to 1,838 (1,790), of which 1,777 (1,669) were FTEs
- Suzanne Donohoe joined EQT in January as Chief Commercial Officer to drive EQT’s external commercial activities
- EQT further strengthened its investment organization with senior talent including Francesco Starace, former CEO and General Manager of Enel, joining EQT as a Partner within the EQT Infrastructure Advisory Team, bringing deep experience and expertise in energy and energy-transition related industries
- Maarten de Jong and Mark Braganza joined EQT’s Private Capital Healthcare team as Partners, to bolster the new EQT Healthcare Growth Strategy, focused on early-stage healthcare investments
- As the first private markets firm to set Science Based Targets, we have supported 29 portfolio companies to get validated science-based targets, and additionally, close to 30 are now in the process of getting there
- EQT published its Net Zero Guidelines and set a target that 100% of the EQT funds’ portfolio companies and real estate assets should be on track to achieve their 1.5°C aligned decarbonization plans by 2040
- EQT expanded Motherbrain across all business lines, enabling investment advisory teams from every corner of the company to leverage EQT’s collective insights and proprietary platform
- EQT continued to drive efficiencies and scalability in its central platform and improving the client experience. For example, EQT reduced the distribution time of fund reports from 52 to 40 business days after quarter close
- EQT opened an office in Seoul, South Korea, and EQT Infrastructure VI acquired SK Shieldus, a leading South Korean integrated security operator
- EQT’s Global Capital Markets team put in place a structure for equity capital market services, similar to its already established practice of providing debt underwriting, in equity and notes offerings related to EQT and its portfolio companies
- Going forward, EQT intends to further increase transparency by providing a combination of metrics related to carried interest. EQT will continue to report carried interest after applying a valuation buffer on the underlying fund valuations (currently defined as adjusted carried interest) as well as cash carried interest. In addition, EQT will provide carried interest based on underlying fund valuations without a discount (mark-to-market). With the revised reporting, EQT will provide a highly transparent carried interest reporting, including the short-term direct impact of fund valuation changes (mark-to-market), a high degree of visibility on expected mid-term cash flows (carried interest post fund valuation buffer), as well as the actual cash flows related to carried interest (cash carried interest)
Events after the reporting period
- Investment levels in EQT key funds as of 18 January 2024, were 30-35% in EQT X, 30-35% in EQT Infrastructure VI and 40-45% in BPEA VIII
- EQT introduced the new Healthcare Growth Strategy, a dedicated healthcare buyout strategy, with the acquisition of life sciences tools company Mabtech
- The Board proposes a dividend per share of SEK 3.60 (SEK 3.00), to be paid in two installments, SEK 1.80 (SEK 1.50) in June 2024 and SEK 1.80 (SEK 1.50) in December 2024
* Adjusted figures. The adjusted metrics are alternative performance metrics for the EQT AB Group.
1) Signed transactions, if not otherwise mentioned
Presentation of EQT AB’s Year-end Report 2023
Financial analysts and media are invited to participate in a conference call, including a presentation at 08:30 CET.
The presentation and a link to follow the webcast and conference call live can be found here and a recording will be available afterwards.
To participate by phone, please register here. You will then receive your personal dial-in details, to be able to ask questions during the Q&A.
Information on EQT AB’s financial reporting
The EQT AB Group has a long-term business model founded on a promise to its fund investors to invest capital, drive value creation and create consistent attractive returns over a 5 to 10-year horizon. The Group’s financial model is primarily affected by the size of its fee-generating assets under management, the performance of the EQT funds and its ability to recruit and retain top talent.
The Group operates in a market driven by long-term trends and thus believes quarterly financial statements are less relevant for investors. However, in order to provide the market with relevant and suitable information about the Group’s development, EQT publishes quarterly announcements with key operating numbers that are relevant for the business performance (taking Nasdaq’s guidance note for preparing interim management statements into consideration). In addition, a half-year report and a year-end report including financial statements and further information relevant for investors is published. Finally, EQT also publishes an annual report including sustainability reporting.
Olof Svensson, Head of Shareholder Relations, +46 72 989 09 15
EQT Shareholder Relations, [email protected]
Rickard Buch, Managing Director, Communications, +46 72 989 09 11
EQT Press Office, [email protected], +46 8 506 55 334
This is information that EQT AB (publ) is obliged to make public pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact persons set out above, at 07:00 CET on 18 January 2024.
The following files are available for download:
EQT AB Year-end report 2023
EQT AB Group
Validation Cloud Secures $5.8 Million in Inaugural Funding to Propel Web3 Infrastructure
ZUG, Switzerland, Feb. 28, 2024 /PRNewswire/ — In a significant stride towards revolutionizing Web3 infrastructure, Validation Cloud has proudly announced the successful closure of its first external investment round, amassing $5.8 million. Spearheaded by San Francisco-based Cadenza Ventures, this funding round exceeded expectations with contributions from an impressive roster of international investors, including Blockchain Founders Fund, Bloccelerate, Blockwall, Side Door Ventures, Metamatic, GS Futures, and AP Capital.
Alex Nwaka, Co-Founder of Validation Cloud, expressed enthusiasm about the funding, “This investment marks a pivotal moment for Validation Cloud as we aim to address the urgent demand for scalable and compliant Web3 infrastructure. We’re honored to collaborate with our investors who are instrumental in propelling the global adoption of our platform among cutting-edge networks, developers, and asset managers.”
Validation Cloud is at the forefront of Web3 technology, having developed an innovative system architecture that paves the way for significant advancements in the sector. Known as the “Cloudflare of Web3,” the company offers a robust, scalable, and intelligent platform providing Staking, Node API, and Data services, drawing inspiration from Cloudflare’s transformative impact on Web2 infrastructure.
Founded by veterans in the Proof-of-Stake domain, Validation Cloud boasts a team of highly experienced professionals from renowned organizations such as Uber, Workday, Deloitte, Citadel, Morgan Stanley, Binance, Crypto.com, Figure, R3, and more, emphasizing a talent-first approach with a worldwide workforce.
Kumar Dandapani, Managing Partner at Cadenza Ventures, highlighted the strategic vision behind their investment, “At Cadenza, we do not invest in just any company; we invest in the future of transformative technologies. Validation Cloud’s pioneering role in Proof-of-Stake and their relentless pursuit of next-generation Web3 infrastructure have set them apart as leaders in the Web3 space.”
Aly Madhavji, Managing Partner at Blockchain Founders Fund, shared his thoughts on the investment, “We believe in the transformative power of Web3 and its ability to redefine how businesses operate. Investing in Validation Cloud aligns perfectly with our vision of supporting innovative platforms that are ready to lead the next wave of digital transformation.”
Validation Cloud has earned a reputation for its close partnerships with networks from their nascent stages, supporting a wide array of ecosystems from established ones like Chainlink, Hedera, and Stellar to emerging networks such as Aptos, Eigenlayer, and Berachain. Their platform lays the groundwork for the enterprise adoption of networks, positioning Validation Cloud as a key player in the Web3 infrastructure landscape.
For further details on Validation Cloud and its offerings, please visit www.validationcloud.io.
Please contact: Kelly Clark, Director of Communications | [email protected]
Klarna says its AI assistant does the work of 700 people after it laid off 700 people
The Swedish fintech, which was criticized for its handling of a dramatic staff reduction in 2022, is touting new efficiencies powered by OpenAI.
Klarna is bullish on bots.
One month after taking its OpenAI-powered virtual assistant global, the Swedish buy-now, pay-later company has released new data touting its ability to handle customer communications, make shoppers happier, and even drive better financial results.
The app-based AI chatbot already handles two-thirds of all customer service chats, the company said Tuesday—some 2.3 million conversations so far—with the virtual assistant earning customer satisfaction ratings at the same level as human agents. Klarna, which is expected to go public this year and will need all the hype it can get at a time when investors have been generally frosty toward IPOs, estimates that the chatbot could help improve its profits by $40 million in 2024.
Announcing a partnership with OpenAI early last year, Klarna said it was one of the first companies to integrate the firm’s groundbreaking ChatGPT technology into a plug-in for shopping. The natural-language interface initially helped customers choose items and make other shopping-related decisions based on personalized queries, a feature Klarna described as “smooth shopping.”
The company has continued to build out its AI offerings since then. Its app-based assistants are now available to customers worldwide and handle a variety of tasks including refunds, cancellations, and even disputes.
Klarna boasted in its announcement on Tuesday that the AI assistant “is doing the equivalent work of 700 full-time agents.”
That statement may raise eyebrows for anyone who remembers the middle of 2022, when the company laid off roughly the same number of employees, then about 10% of its staff. At the time, CEO Sebastian Siemiatkowski cited economic uncertainty, inflation, and the likelihood of a recession as reasons for the cuts. He was criticized for his handling of the staff reduction after he shared a public spreadsheet on LinkedIn that contained the names of many of the laid-off workers.
Fast Company asked Klarna how the company arrived at its calculation for its AI assistant’s human-equivalent productivity. The company said the number of equivalent jobs the AI could perform wasn’t related to the layoffs. In a statement, a spokesperson said the company’s customer service is supported by four to five large third-parties that collectively have over 650,000 employees, and that it offers customers the option to speak with human agents if that’s what they prefer.
“This is in no way connected to the workforce reductions in May 2022, and making that conclusion would be incorrect,” the statement read. “We chose to share the figure of 700 to indicate the more long-term consequences of AI technology, where we believe it is important to be transparent in order to create an understanding in society. We think [it’s] important to proactively address these issues and encourage a thoughtful discussion around how society can meet and navigate this transformation.”
Companies have used chatbots for years to handle low-level customer queries and other interactions, although these tools are expected to become more versatile in the wake of advancements in artificial intellegence.
Source: Fast Company
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KAPSARC Launches Saudi Arabia’s First School of Public Policy
- Inspired by His Royal Highness, the Minister of Energy, Prince Abdulaziz bin Salman Al Saud’s passion for education, human capital development and innovation, the KAPSARC School of Public Policy (KSPP) was founded as the first institution in Saudi Arabia dedicated to graduate studies and executive education in public policy.
- Through its academic offerings, KSPP empowers individuals to tackle pressing public policy challenges and embrace the promising opportunities shaping the future.
- KSPP’s facilities will run on 100% renewable energy, setting a precedent as one of the first net-zero facilities in the Saudi educational sector.
RIYADH, Saudi Arabia, Feb. 28, 2024 /PRNewswire/ — The King Abdullah Petroleum Studies and Research Center (KAPSARC) has been granted an establishment license for its School of Public Policy (KSPP) after the recent approval by the Council of Ministers, and which was announced during the Human Capability Initiative (HCI) on February 28, 2024, conducted under the patronage of Prince Mohammed bin Salman bin Abdulaziz, Crown Prince, Prime Minister, and the Chairman of the Human Capability Development Program Committee, one of Saudi Arabia’s Vision 2030 Realization Programs.
Aiming to set new standards in policy studies, the school offers a two-year master’s degree and executive education programs designed to enable and empower future policy leaders and professionals within Saudi Arabia and globally to address the most pressing domestic and international public policy challenges in the public, non-profit and private sectors.
This significant achievement was announced by His Royal Highness, Prince Abdulaziz bin Salman Al Saud, the Minister of Energy, Chairman of the Board of Trustees of KAPSARC: “The vision for KAPSARC School of Public Policy is to develop the knowledge and skills that the new generation needs to shape public policy both locally and globally. Our mission is to empower and equip future policy leaders and professionals within Saudi Arabia and internationally to make informed socio-economic decisions.”
In a statement on the sidelines of the school’s launch, Fahad Alajlan, President of KAPSARC, stressed the Center’s mission to impact public policy on national, regional, and global levels. “Our new School of Public Policy will equip future leaders with the right skills to create data-driven and evidence-based public policy in line with Vision 2030 goals.”
Dr. Ghadah Alarifi, Founding Dean of KSPP, stated that, “Public policy serves as the foundation of societal progress. At KSPP, we aim to be a catalyst for collaboration, building a robust ecosystem that bridges academia, industry, and government in the public policy arena.”
By leveraging KAPSARC’s network, KSPP provides a platform for global engagement and career growth opportunities, offering practical application and flexible courses tailored to empower policymakers in different tracks including energy policy.
The school is committed to achieving high sustainability standards in the Saudi educational sector, including the goal of running on 100% renewable energy. This dedication ensures that KSPP meets its annual energy needs through on-site renewable resources, eliminating the use of fossil fuels.
For more information about KSPP, visit https://www.kapsarc.org/about-the-school/.
Follow KSPP on social media:
- X: @KAPSARC_SPP
- LinkedIn: @ KAPSARC School of Public Policy
KAPSARC is a leading think tank dedicated to advancing knowledge on energy, environment, and regional economic issues. Accredited observer of UNFCCC, KAPSARC actively contributes to global climate action. The mission of KAPSARC is to advance Saudi Arabia’s energy sector and inform global policies through evidence-based advice and applied research. For more information about the center please visit: https://www.kapsarc.org/
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