Assets under management of Invalda INVL group asset management companies rose to EUR 374.3 million
Invalda INVL, one of the Baltic region's leading asset management groups, had consolidated equity capital of EUR 47.5 million, or EUR 4.10 per share, at the end of the first half of 2016, which is 0.24% less than at the start of the year. The Invalda INVL group had a consolidated loss of EUR 0.2 million in the first half, versus a profit of EUR 4.1 million in the same period of 2015.
"Ongoing operations, the current valuation of our investments and the plans of the companies we've invested in give reason to expect that 2016 will be successful for the Invalda INVL group," said Darius Sulnis, the president of Invalda INVL.
During the first half of the year, Invalda INVL acquired 1.1% of its own shares for EUR 0.6 million and the company's shareholders also approved a stock option policy for employees of the group.
Asset management business
Invalda INVL's asset management companies INVL Asset Management in Lithuania and Latvia, the wealth-management financial brokerage firm INVL Finasta, and the administrative company INVL Farmland Management had assets under management of EUR 374.3 million at the end of June 2016, or 14% more than at the end of 2015 (EUR 328.2 million). The number of clients increased by 2.7% during the first half of the year to 171,200.
"The money clients have entrusted to us is being managed successfully and the majority of the pension and mutual funds and securities portfolios that we manage show gains for 2016. The long-term advantage we're creating for our clients is the essential precondition for maintaining rapid growth of assets under management now and in the future," Sulnis said.
He said substantial investments in expansion of the asset management business and in service quality are having a negative impact on short-term results, but are creating long-term value for clients and for the Invalda INVL group.
Revenues of Invalda INVL group companies from asset management and administration activities increased 22% (compared with the same period in 2015) during the first half of 2016 to EUR 2.1 million; the companies had losses of EUR 0.3 million in the period. Investments in the asset management business at the end of the first half totalled EUR 7.9 million.
Investments
Investments in related companies
At the end of June, Invalda INVL held 32.1% of shares in the real estate investment company INVL Baltic Real Estate, which were valued at EUR 8.2 million. This investment earned EUR 263 thousand in the first half of the year, including dividends. In March 2016, INVL Baltic Real Estate completed a 9 million-euro offering of new shares in which Invalda INVL acquired shares for EUR 6.2 million.
"Reconstruction at the Vilnius Gates complex and focused work with this and other properties held by the company and their tenants, along with rising real estate values, should have a positive effect on INVL Baltic Real Estate's results in the near future," Darius Sulnis said.
He said INVL Baltic Real Estate is currently seeking a closed-end investment company (UTIB) license in order to properly structure its business and fulfil the commitments it made during the public share offering.
Invalda INVL's 15.7% stake in INVL Technology had a value of EUR 3.4 million at the end of June 2016, while the recognised loss from the change in value of the company's shares was EUR 0.4 million. In July, INVL Technology obtained a closed-end investment company license and its management was transferred to INVL Asset Management.
"We take a neutral view to the company's 6-month results. INVL Technology is currently in an investment cycle where what's important is making suitable acquisitions at reasonable prices and, by expanding held or newly acquired business, creating significant value for shareholders. In the year since its share offering, INVL Technology has completed acquisitions for 3.25 million euros, which is in line with its plans and promises to investors," Darius Sulnis said.
Agriculture
The value of Invalda INVL's investments in the Baltic agribusiness company Litagra, in which it has a 36.9% stake, was EUR 12 million at the end of June 2016. The shares' fall in value caused a loss of EUR 2.9 million in the first half of the year.
"Reduced milk prices hurt results in the primary agricultural production business and reduced the company's value, though the farmer services and grain trading business has shown improving performance," Sulnis said.
Banking
Invalda INVL holds a 6.79% equity stake in Siauliu Bankas, the value of which increased by EUR 2 million in the first half of the year to EUR 8.4 million. "We're satisfied with Siauliu Bankas's record results and organic growth of its business. The Baltic banking market is undergoing consolidation – that creates new opportunities for a bank that's closer to customers," Sulnis said.
Facility management
Companies of the Inservis facility management group, which Invalda INVL controls, had a total value of EUR 5.5 million at the end of the first half of 2016, or EUR 0.9 more than at the end of 2015. "We're actively looking for acquisitions in the facility management segment in Lithuania and Latvia," Sulnis said.
Other investments
At the end of June 2016, Invalda INVL had EUR 0.6 million of investments in other publicly traded shares, as well as other investments and loans with a value of EUR 1.6 million. Invalda INVL had total liabilities of EUR 0.9 million at the end of the half-year.
Invalda INVL AB, operating since 1991, is one of the leading asset management groups in the Baltic countries. Companies the group owns in Lithuania and Latvia manage more than 20 mutual, real estate and pension funds (2nd and 3rd pillar), alternative investments, individual portfolios, private equity and other financial instruments. The group's companies manage over EUR 370 million of assets entrusted to them by more than 170,000 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.
Enclosed:
– Invalda INVL Consolidated Interim Condensed Unaudited Financial Statements for 6 months of 2016;
– Invalda INVL Consolidated Interim Report for 6 months of 2016;
– Factsheet;