Invalda INVL announces H1‘2022 results with equity of EUR 101.4 million

Invalda INVL announces that at the end of June 2022 its equity level amounted to EUR 101.4 million or EUR 8.58 per share. This is down by 10% and 10.56% respectively in comparison to the period to the end of 2021.

Invalda INVL made a loss of EUR 12.7 million in the first half of 2022, compared to a net profit of EUR 13 million in the same period last year.

The Group’s client assets under management (“AUM”) amounted to EUR 1.7 billion on 1 July 2022, 5.8% higher than at the beginning of 2022 (EUR 1.609 billion). This is following the takeover of Mandatum Life’s life insurance business, which has more than 29,000 clients and assets of EUR 150 million. This development means the number of clients entrusting their funds to the INVL Group has increased by 12.6% to 293,000 in total.

Darius Šulnis, President of Invalda INVL, commented: “In the first half of 2022, both clients and the Group experienced losses due to a decline in the value of their investments. Geopolitical instability, high energy and commodity prices, governments’ efforts to address inflation, the pressure of recession and other negative factors have resulted in predictable tension for most of the world’s financial markets. This current economic climate has been directly reflected in the Group’s operating results. However, market volatility and economic cycles are natural in our business. This encourages us to adapt to changes and pursue new, emerging opportunities in order to protect and increase investments entrusted to us”.”

Investment management and life insurance business

Invalda INVL’s revenues from the operational part of the investment management business (the management of funds entrusted by clients) amounted to EUR 6.8 million in the first half of 2022, down by 4.5% compared to the corresponding period in 2021.

The client investment management business generated a loss of EUR 1 million in the first half of 2022 compared to a profit of EUR 1.2 million in the same period last year. The overall investment management business, including its investments in collective investment undertakings managed by INVL, generated a loss of EUR 0.1 million compared to a profit of EUR 1.2 million in the same period of 2021.

On 1st July 2002, Invalda INVL successfully completed the acquisition of Mandatum Life’s life insurance business in the Baltics. As a result, Invalda INVL has become both an investment management and a life insurance group. This investment has meant an increase in AUM and the number of clients for the Group, as well as a strengthened team with a particular focus on the new life insurance business that also services a new market in Estonia.

Darius Šulnis added: “The acquisition of the life insurance business is an important strategic step, as it allows us to offer our client base a greater range of tailored financial solutions, as well as ultimately having a positive impact on the Group’s overall growth and development prospects.”

The funds managed by the Group were also active in the second quarter of the year, continuing to successfully raise capital for their development while also carrying out investment and asset management activities aligning with their overall strategy.

INVL Partner Global Infrastructure Fund I, which invests in the infrastructure fund of a world-class asset manager, raised EUR 37.5 million from investors in the second quarter of 2022. INVL Baltic Forest Fund I, our first fund that invests in forestry land, earned investors an average annual return of 27.3%, after closing in the beginning of June 2022.

During the second quarter of 2022, the main funds of INVL continued to increase in line with their respective strategies. For example, INVL Sustainable Timberland and Farmland Fund II acquired 1,184 hectares of farmland and forests in Latvia. INVL Renewable Energy Fund I started its operations in Romania. INVL Baltic Real Estate acquired the remaining part of the building located at 37 Vilniaus Street in the capital city of Lithuania. Finally, INVL Baltic Sea Growth Fund acquired MiniVet, a leading chain of veterinary clinics and also signed an agreement for the purchase of the Birštonas Spa Nemunas and the Eglė Sanatorium, a recreation and special health treatment centre.

Equity investments

Other own investments of Invalda INVL, excluding the investment management and life insurance business, generated a loss of EUR 13.6 million. This was mainly (EUR 15 million) as a direct result of the decrease in value of Šiaulių Bankas and Moldova-Agroindbank (“maib”), the largest bank in Moldova (impacted by EUR 3.9 million). These combined losses reflect a general trend for the decline in the value of banks that are listed on the public markets.

Darius Šulnis, President of Invalda INVL, commented: “Šiaulių Bankas’ and maib’s key performance indicators continued to grow as the banks earned more profit than in the first half of 2021. However, the general decline in the value of banks listed on the public markets subsequently depreciated our holdings and ultimately had a material impact on the negative results for the first half of this year. We strongly believe that successful and sustainable banking practices create real value and this will be reflected in the share price over the medium to longer term.”

The value of Invalda INVL’s investments was positively (EUR 3.6 million) affected by the profitable performance of Litagra, one of Lithuania’s largest agribusiness groups. Litagra, which continues to operate successfully with the significant increase of food supply to both domestic and global markets and with the additional integration into its operations of the recently acquired agricultural company, Noragra. This company operates on approximately 1,700 hectares of land and has 750 dairy cows. This year Litagra Group also acquired 29 farms and a feed mill in Marijampolė county as it entered the marketplace for turkey focused operations.

In the second quarter of 2022, Invalda INVL sold the Inservis group, which under its stewardship had become a highly successful and stable business, for EUR 7.2 million.

About Invalda INVL

Invalda INVL is a leading Baltic investment management and life insurance group with an open approach, growing and developing, and creating well-being for people through its activities. The Group’s companies, operating across Lithuania, Latvia and Estonia, service over 290,000 private and institutional clients from both the Baltic region and abroad. These clients have entrusted the Invalda INVL Group with the management of over than EUR 1.7 billion covering a variety of asset classes including pension, mutual funds and life insurance commitments as well as individual portfolios, private equity and other alternative investment activities.

The shares of Invalda INVL have been traded on the Nasdaq Vilnius stock exchange since 1995.