2019 Interogo Holding Annual Report Published
Today Interogo Holding AG, a foundation-owned investment group, presented its 2019 Annual Report. In a year marked by uncertainty, Interogo Holding continued to steadily invest. Net profits reached EUR 845m, contracting EUR 11m from 2018. In 2019, Interogo Holding also decided to add long-term equity and infrastructure to its existing investment strategies.
“The signs of slowdown in global growth observed in 2018 got confirmed in 2019. Global growth recorded its weakest pace since the global financial crisis a decade ago. Despite the uncertainty in the economic environment, and a more sluggish growth outlook, we remained committed to our long-term strategy and steadily and carefully deployed capital trough-out the year”, says Søren Hansen, CEO of Interogo Holding AG.
During 2019, Interogo Holding invested EUR 475m in tangible assets and EUR 202m in financial assets (net), from EUR 495m and EUR 204m in 2018, respectively.
In this mixed environment of uncertainty and high asset prices, our investment businesses recorded a slowdown in their investment income, essentially driven by lower pace of divestment activities.
Our private equity strategy is to invest globally in the private equity market directly and through funds, secondaries and co-investments. The objective is to identify and unlock values by providing capital and active ownership support to management teams. Private equity assets under management per 31 Dec. 2019, amounted to EUR 4,435m.
The global private equity portfolio, IFM supported by International, saw a sharp decrease in exit activities from its underlying fund investments. The Nordic direct investment business, Nalka Invest, completed the sale of one smaller portfolio company, focusing on new acquisitions.
Both our global investments in secondaries, funds and co-investments and direct investments in Nordic businesses had less exit activities compared to a very active 2018.
Our real estate strategy is to invest in European real estate markets by focusing on developing and managing assets in the commercial, residential and hotel segments. As both a developer and owner we strive to create long-term values. Real estate assets under management per 31 Dec. 2019, amounted to EUR 4,150m.
The real estate strategy, led by Vastint Group, recorded strong organic growth of 12 percent in rental income, as new offices and hotels were delivered. It also continued to take advantage of favourable market conditions to successfully complete the sale of non-strategic properties. However, these transactions were of a lower size than in 2018.
Our liquid asset strategy is to manage a portfolio of listed securities, mainly equities and fixed income. By focusing on liquid positions, we aim to achieve a high degree of flexibility in managing the assets. The investments are supported and managed by Inter Fund Management (IFM). Liquid assets under management per 31 Dec. 2019 amounted to EUR 7,650m. Our owner, Interogo Foundation, is the main investor in the fund (EUR 5,945m).
To complement the existing investments strategies, Interogo Holding added two additional strategies during 2019: long-term equity and infrastructure.
The long-term equity strategy focuses on significant equity holdings in profitable and sustainable European listed, soon-to-be listed and private companies with strong market positions and potential for future performance. Long-term equity assets under management per 31 Dec. 2019 amounted to EUR 365m
The infrastructure strategy will focus on acquiring holdings in infrastructure companies that provide essential services to society and which are recession resilient and have stable cash-flows. This strategy is under establishment.
The decrease in consolidated operating income in 2019 of EUR 725m (EUR 1,029m), and in operating result (EBIT) in 2019 of EUR 70m (EUR 453m) are mainly related to a sharp decrease in exit activities within private equity, compared to 2018.
We believe that long-term sustainable competitiveness can only be achieved when businesses create value for both their owners and for other stakeholders, including co-workers, society and the environment. In our real estate business, a systematic focus on sustainability is integrated in the day-to-day operations. Our other investment businesses have to evaluate investments based not only on sound financial criteria, but also on policies developed to weigh in environmental, societal and governance (ESG) factors.
Interogo Holding AG is a non-voting co-shareholder, contributing capital and loan, in Inter IKEA Holding B.V. Our owner, Interogo Foundation is the controlling shareholder in Inter IKEA Holding B.V. On the back of a strong financial year 2019, Inter IKEA Holding B.V. distributed a dividend of EUR 850m (compared to EUR 500m in 2018).
Key figures consolidated (under Swiss GAAP FER) 1 Jan. - 31 Dec.
|Numbers in brief, EUR million||2019||2018 restated*|
|Operating income||724||1 029|
|Operating result (EBIT)||70||453|
|Net Profit (attributable to shareholders of the parent company)||845||856|
|Total Assets||23 271||21 227|
|Shareholder’s equity (including the year’s result)||9 840||8 976|
*The 2018 figures were restated due to change in functional currency of some consolidated entities. Please see note on page 18 in the annual report.
The full Interogo Holding AG Annual Report 2019 is available here