Invalda INVL, one of the Baltic region’s leading asset management groups, had equity of EUR 74.8 million at the end of September this year, or EUR 6.40 per share – which is respectively 3.1% and 3.6% less than at the end of 2019 (taking into account the dividends paid out). Dividends which were paid out to Invalda INVL’s shareholders in May this year (EUR 0.80 per share) reduced the company’s equity by EUR 9.3 million.
Invalda INVL’s unaudited net loss in the first three quarters of this year amounted to EUR 3 million, whereas in the same period last year the company had a profit of EUR 13.6 million.
“Despite good operating results at the group’s companies, we ended the first three quarters with a loss. The reason for that was a negative change in the value of our investments, reflecting the general situation in the markets,” says Darius Šulnis, the President of Invalda INVL .
Client assets under management by the group’s companies at the end of September totalled EUR 1,107.8 million and were up 6.5% from the start of the year. Due to the significant pandemic-related drop in the markets early this year and continuing uncertainty, which have contributed to a decrease in the value of some investments, clients suffered a loss of EUR 15.7 million in nine months of this year.
Asset management business
Invalda INVL’s revenue from the asset management business in the first nine months of this year was EUR 9.2 million and compared with the same period of 2019 increased by 24%. The company earned EUR 0.77 million from the asset management business, which is 16% less than in the same period last year.
The INVL Baltic Sea Growth Fund, the largest private equity investment fund in the Baltic region, in September completed the acquisition of a 48% stake in MBL, a leading European manufacturer of medical mobility devices which is headquartered in Denmark. Also in the third quarter, work continued on several important transactions expected to be completed in 2021.
The real estate investment company INVL Baltic Real Estatesold the 7,200-sq.m. part of the Vilnius Gates business centre that it owned for EUR 20 million in September. After the transaction, INVL Baltic Real Estate’s net asset value (NAV) per share at the end of September would be EUR 2.1567 if calculated using the share buy-back liability computed according to the actual number of shares bought back. Taking into account pay-outs to shareholders, the total return since the public offering in 2016 is 100%. The internal rate of return (IRR) is roughly 18%.
“We are delighted with INVL Baltic Real Estate’s extraordinarily successful activities and ability to create value. We expect further focused efforts, taking advantage of the existing potential and new opportunities that arise and maintaining a generous policy of pay-outs to shareholders,” Darius Šulnis, the President of Invalda INVL, says.
Šulnis notes that already after the end of the third quarter, the new INVL Sustainable Timberland and Farmland Fund IIraised EUR 32.45 million from private investors and has already completed the first large transaction. The fund invests in sustainably managed forests and agricultural land in the Baltic Sea region and Central and Eastern Europe.Itstarget size is EUR 100 million, with the fund’s next offer phase foreseen in 2021.
Investments
At the end of September this year, the value of investments in products which the Invalda INVL group manages totalled more than EUR 27 million, while the legacy investments exceeded EUR 35 million. A loss of EUR 11.1 million was sustained from declines in the value of investments during the first nine months of 2020, but EUR 7.2 million of dividends were received.
“The first three quarters of the year were successful for the businesses Invalda INVL has invested in: Litagra, Inservis, INVL Baltic Real Estate, INVL Technology – they notably improved their results. Given this year’s situation, the decrease in profit at Šiaulių Bankas and Moldova’s biggest commercial bank Moldova-Agroindbank (MAIB) has been modest. Despite good operating results, the uncertainty surrounding Covid-19 has reduced the companies’ valuation in the market,” says the president of Invalda INVL.
According to Šulnis, currently Invalda INVL’s main priority is further development of the asset management business and active investments in the separate classes of assets managed.
Invalda INVL, operating since 1991, is one of the leading asset management groups in the Baltic countries. The companies that the group owns in Lithuania and Latvia manage more than 20 mutual and pension funds (2nd and 3rd pillar), individual portfolios, private equity and other alternative investments. At the end of September 2020, the group’s companies had more than EUR 1.1 billion of assets under management, entrusted to them by over 200,000 clients in Lithuania and Latvia as well as international investors.
The shares of Invalda INVL have traded on the Nasdaq Baltic securities exchange since 1995.