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| Filename | Forty-Two-Point-Two-final-report-final-20240717-National-Scale-Ratings-Only.pdf |
| Filesize | 280.70 KB |
| Version | 1 |
| Date added | July 17, 2024 |
| Downloaded | 1 time |
| Category | Credit Rating Reports, Financial Institution |
| Tags | Mauritius, South Africa |
Forty Two Point Two Limited (FTPT, Forty Two Point Two) is an investment holding company, domiciled in Mauritius. It was established as an investment vehicle through which key employees and senior management of Ninety One Limited and Ninety One Plc (collectively referred to as Ninety One) built a long-term investment in the founder-led global investment manager. Forty Two Point Two only invests in the dual-listed shares of Ninety One, holding a c.27.8% shareholding in the company as at 31 March 2024.
Ninety One was founded in South Africa over 30 years ago and has been organically and sustainably grown into a global player with approximately GBP126.0 billion in assets under management (AUM) at 31 March 2024 – the AUM decreased from GBP129.3 billion and GBP143.9 billion at 31 March 2023 and 31 March 2022. It has a market leading position in its Southern African operations, while also reflecting material geographic diversification in developed regions such as UK, Europe, and North America. The client grouping is well spread across pension funds, public authorities, official institutions, insurance companies, private banks, wealth managers and corporates having been built up on the back of a long-standing track record and good market acceptance/branding within the core markets. The GCR calculated Earnings Before Interest, Taxes, Depreciation and Amortisation (EBITDA) margins have been good, with strong earnings in 2023 and 2024. Nevertheless, AUM growth has moderated and may continue to do so in the next 12-18 months due to highly uncertain macro conditions globally and rising interest rates that is fostering risk aversion across the investor base. However, we expect EBITDA margins to remain above 28% over the outlook horizon. Balance sheet risk is very low given the capital light nature of the business and absence of debt, while revenue sources are stable, comprising mainly management fees. Liquidity is good, with sound cash flow generative capacity supporting good medium-term sources vs. uses coverage of between 1.00x to 1.25x, albeit upside is limited due to the high dividend pay-out policy. While this moderates the liquidity score for Ninety One, it supports income stability for Forty Two Point Two.