Economic Environment - The U.S. government shutdown is impacting investor confidence and delaying key economic data, including the September jobs report, which showed a low job growth of 17,000 compared to 22,000 in August [5][9] - The shutdown has led to increased interest in safe-haven assets like gold, which reached $4,000 per ounce for the first time, reflecting economic uncertainty [4][11] - Goldman Sachs vice chairman Robert Kaplan highlighted that gold's rise of nearly 40% year-to-date serves as a warning signal for investors [5][11] Market Reactions - Investors are moving towards safe-haven assets due to the government shutdown, with gold prices surging [4][11] - The S&P 500 fell 0.4% after eight consecutive days of gains, driven by weak Oracle shares and concerns over AI profits [11] - JPMorgan downgraded several consumer finance stocks, including OneMain and Synchrony Financial, to neutral due to weakening macroeconomic conditions [6][11] Company-Specific Developments - Trilogy Metals shares surged over 200% following a $35.6 million investment from the White House, making it a 10% shareholder aimed at unlocking domestic supplies of copper and critical minerals in Alaska [12] - Constellation Brands reported earnings that beat estimates, with revenue of $2.48 billion and adjusted earnings of $3.63 per share, leading to a premarket share increase of over 3% [9][12] - Aehr Test Systems experienced a significant drop of nearly 20% after reporting a year-over-year revenue decline and providing no guidance [12]

Summary of 3i Group plc Capital Markets Seminar Company Overview - **Company**: 3i Group plc - **Key Focus**: Private Equity investments, particularly in consumer and retail sectors - **Recent Investments**: WaterWipes and OMS Prüfservice - **Recent Disposals**: NPM and Mate Key Points Industry and Market Performance - **Macro Environment**: Both Private Equity and Infrastructure portfolios are performing resiliently despite a subdued macroeconomic environment [3][4] - **Sales Growth**: Year-to-date sales as of September 21, 2025, reached €10.9 billion, an 18% increase compared to the same period last year. Like-for-like sales growth was 6.5% [3] - **Operating EBITDA**: Expected to be approximately €2.295 billion for the 12 months ending September 2025, up 21% from €1.894 billion in September 2024 [3] Recent Investments - **WaterWipes**: Acquired in January 2025 for €145 million. The product is a premium natural wet wipe brand, consisting of 99.9% pure water and a drop of seed extract. Over 50% of revenue comes from the U.S. [18][19] - **OMS Prüfservice**: A testing business for electrical safety equipment, focusing on both portable and fixed equipment. The company has over 700 employees and serves more than 7,000 customers [63][64] Recent Disposals - **NPM Sale**: Sold to Partners Group for €400 million, achieving a 3.2 times money multiple and a 29% IRR. The sale was driven by consistent outperformance and strong interest from various investors [17][63] - **Mate Sale**: Sold for approximately €143 million, representing a 30% uplift from the March valuation, resulting in a 2.7 times multiple of invested capital and a 27% IRR [5][63] Strategic Insights - **Consumer Sector Focus**: Over 80% of the Private Equity portfolio by value is in the consumer sector. The company has invested around €1.7 billion in this sector over the last two years [8][9] - **Investment Thesis**: The strategy for both NPM and WaterWipes is built around four pillars: core business development, U.S. market expansion, online growth, and brand enhancement [12][26] - **Market Trends**: The global premium cat food market is growing at a CAGR of 6%, while the wet wipes market is valued at approximately €13 billion with mid-single-digit growth [11][20] Financial Performance - **WaterWipes Financials**: Achieved net sales of around €200 million in 2024, with a CAGR of over 20% since 2017 [25][26] - **OMS Prüfservice Growth**: The company has shown consistent growth, with revenues increasing by more than 40% from 2016 to 2024 [65] Challenges and Considerations - **U.S. Tariffs Impact**: The U.S. tariffs have introduced some uncertainty, but the businesses are managing the implications within their pricing and cost structures [32][33] - **Exit Strategy**: The decision to exit NPM was based on its distance from reaching the $100 million EBITDA threshold required for long-term holds [34] Additional Insights - **Sustainability Focus**: WaterWipes emphasizes sustainability, being entirely natural and plastic-free, which resonates with consumer preferences [23][24] - **Market Positioning**: Both NPM and WaterWipes are positioned as challenger brands in their respective markets, appealing to globally applicable consumer needs [43][44] This summary encapsulates the key points discussed during the 3i Group plc Capital Markets seminar, highlighting the company's strategic focus, recent financial performance, and market positioning.

Core Insights - Prometric's CELPIP test has been officially recognized by the Australian government for visa applications, providing a new option for international students and job seekers to demonstrate their English language proficiency [1][2] - The CELPIP test evaluates four key language skills: listening, reading, writing, and speaking, and is completed in a single 3-hour session, enhancing the testing experience for candidates [1] - Prometric is expanding its test center network in Australia and Asia to meet the growing demand for CELPIP, ensuring accessibility for all candidates [2] Company Overview - Prometric is a global leader in qualification certification and skills development, operating in over 180 countries with the largest network of test centers among assessment providers [3] - With over 30 years of expertise in assessment, Prometric aims to create better opportunities for individuals and contribute to workforce development [3]

Financial Data and Key Metrics Changes - Orders increased by nearly 22% in the quarter, resulting in a record backlog of $932 million [15] - Sales rose by 6.6% in the quarter, with all three segments contributing to the growth [15] - Adjusted EBIT margins were at 18%, with incremental margins on sales growth at 56%, leading to adjusted earnings per share of $1.35, a 24% increase year-over-year [15][21] Business Segment Data and Key Metrics Changes - **Aerospace and Defense**: Orders were up 5% with nearly 8% sales growth, driven by commercial aerospace and Navy orders. Adjusted EBIT margins increased by 400 basis points, with EBIT dollars up 28% due to favorable pricing and mix [16][17] - **Utility Solutions Group**: Orders grew nearly 17%, with sales growth of 4%. Adjusted EBIT margins improved to 23%, up 290 basis points year-over-year [18] - **Test Business**: Orders surged by 75%, with sales up 9%. Margins improved to 12.4%, benefiting from volume leverage and price increases [19] Market Data and Key Metrics Changes - The aerospace and defense market is expected to continue growing despite macro uncertainties, with strong demand for commercial and defense aircraft [8] - The utility market is experiencing a favorable business cycle, driven by increased electricity demand and aging infrastructure [11] - The renewable energy market is recalibrating, but order activity is improving compared to the previous year [12] Company Strategy and Development Direction - The company completed a major acquisition of SMMP, rebranding it as ESCO Maritime Solutions, which is expected to enhance margins and growth [10] - The strategic planning process assessed end markets and strategies to achieve above-market growth [7] - The company remains focused on navigating macroeconomic challenges while leveraging its diverse business mix [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate economic challenges and highlighted strong operational performance [5][25] - The outlook for the aerospace and defense markets remains positive, with expectations for continued growth despite recent order moderation [8] - Management acknowledged potential impacts from tariffs but emphasized proactive measures to mitigate risks [34] Other Important Information - The company updated its earnings guidance for 2025, projecting adjusted earnings per share in the range of $5.85 to $6.15 [23] - The acquisition of ESCO Maritime Solutions is expected to contribute adjusted earnings per share of $0.20 to $0.30 for the remainder of the fiscal year [23] Q&A Session Summary Question: Update on the sale of VACCO - Management indicated ongoing interest in the sale process, with a decision expected by May [28] Question: Performance of the underlying business - Management noted improvements in overall business performance, with stabilization observed compared to previous years [30] Question: Clarification on tariff impacts - The estimated tariff impact of $2 million to $4 million is a net figure, factoring in pricing adjustments and operational changes [34] Question: Cash generation from Maritime Solutions - Management expects strong cash flow benefits from the Maritime acquisition, with ongoing assessments as integration progresses [42] Question: Thoughts on shipbuilding budgets and orders - Management expressed confidence in the shipbuilding budget and order flow, particularly for Navy programs [45][76] Question: Insights on commercial aircraft orders - Management noted a moderation in commercial aircraft orders but remains optimistic about future demand normalization [72] Question: Pro forma capital structure and leverage profile - Management indicated a leverage ratio of just over 2.2 at closing, with expectations to reduce it below 2 as debt is paid down [81]

Financial Data and Key Metrics Changes - Orders increased by nearly 22% in the quarter, resulting in a record backlog of $932 million [15] - Sales grew by 6.6% in the quarter, with all three segments contributing to the increase [15] - Adjusted EBIT margins were at 18%, with incremental margins on sales growth at 56%, leading to adjusted earnings per share of $1.35, a 24% increase year-over-year [15][21] Business Segment Data and Key Metrics Changes - **Aerospace and Defense**: Orders were up 5% with nearly 8% sales growth, driven by commercial aerospace and Navy orders. Adjusted EBIT margins increased by 400 basis points, with EBIT dollars up 28% due to favorable pricing and mix [16][18] - **Utility Solutions Group**: Orders grew nearly 17%, with sales up 4%. Doble experienced 5% sales growth, while NRG's sales were flat. Adjusted EBIT margins improved to 23%, up 290 basis points year-over-year [17][19] - **Test Business**: Orders surged by 75% compared to last year, with sales up 9%. Margins improved to 12.4%, benefiting from volume leverage and price increases [19][20] Market Data and Key Metrics Changes - The aerospace market shows fundamental demand for additional commercial and defense aircraft, with expectations for continued growth despite recent moderation in order rates [8][9] - The utility market is experiencing a favorable business cycle, driven by increased electricity demand and aging infrastructure [11][12] - The test business is recovering, with strong activity in EMC testing, healthcare, and industrial markets [13][14] Company Strategy and Development Direction - The company completed a major acquisition of SMMP, rebranding it as ESCO Maritime Solutions, which is expected to enhance margin and growth profiles [10][24] - The strategic planning process indicates a focus on delivering above-market growth by assessing end markets and strategies [6] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in navigating macroeconomic uncertainties and geopolitical risks, highlighting strong underlying business conditions [4][5] - The long-term outlook for aerospace and defense remains positive, with expectations for continued growth despite short-term challenges [7][9] - The company anticipates growth in the utility sector due to increasing electricity demand and the importance of renewable technologies [12] Other Important Information - The company expects sales growth of 6% to 8% for the year, with adjusted earnings per share guidance increased to a range of $5.65 to $5.85 [23][24] - The acquisition is projected to contribute adjusted earnings per share in the range of $0.20 to $0.30 [23] Q&A Session Summary Question: Update on the sale of VACCO - Management indicated ongoing interest in the sale process, with a decision expected by May [28] Question: Performance of the underlying business - The business has stabilized with improved performance compared to last year, although margins remain lower than other segments [30] Question: Clarification on tariff impacts - The estimated tariff impact of $2 million to $4 million is a net number, factoring in mitigation efforts [32][34] Question: Cash generation from Maritime Solutions - Management expects strong cash flow benefits from the Maritime acquisition, with ongoing assessments as integration progresses [40] Question: Thoughts on the 2025 and 2026 budget for shipbuilding - Management is optimistic about the shipbuilding budget, noting strong visibility and progress in programs [42][43] Question: Commercial aircraft orders moderation - Management noted a slight moderation in orders due to inventory management but remains confident in future growth [68] Question: Status of Department of Defense programs - Programs related to submarines and Navy initiatives are prioritized, with a positive order flow expected [70]