3i Group (OTCPK:TGOP.F) Update / Briefing Transcript

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.