AP6 Year-end report for 2017 - Strong earnings and a high rate of investment
2017 was a very good year for the Sixth AP Fund (AP6). There has been value growth across the entire portfolio of holdings and the investment rate has remained high. A return of 12.3 (6.5) percent was generated during the year.
The net profit for 2017 amounted to SEK 3,470 (1,722) million, which corresponds to a return of 12.3 (6.5) percent. Internal management costs amounted to SEK 86 (92) million.
“The return that was generated during the year is a result of conscientious efforts to restructure the portfolio and there has been a high rate of investment over the last five years. Also in 2017 a steady flow of attractive investment opportunities from both existing and new partners has resulted in several new investments. These were carefully selected and evaluated through our internal processes. Our strives to be selective when it comes to both partners and holdings is one of the main contributing factors behind our strong earnings for this year,” says Karl Swartling, Managing Director at AP6.
The funds and companies that AP6 has invested in have performed extremely well during the year. The return on capital employed in these unlisted investments has delivered a record high return of 20.3 (9.5) percent for the year. AP6 is a closed fund, so it is relevant to distinguish between employed capital and liquidity, since the balance between them can vary quite significantly over the years due to such things as major divestments. The high liquidity that was generated from realigning the portfolio (which involved significant divestments) has been employed in accordance with a long-term plan. The rate of investment remained high during the year and a large number of new fund commitments were concluded, along with a dozen or so new direct investments.
AP6’s return must always be evaluated with a long-term perspective, since a long period of time is required for creating and realising value in unlisted investments. Over the last five years, the annual return on employed capital has been 11.6 percent, which is above the average for the European Private Equity sector.
For more information:
Ulf Lindqvist, Head of Communications at AP6: +46 (0)708 – 74 10 48
About Sixth Swedish National Pension Fund
SE-411 06 Gothenburg - Sweden
+46 31 - 741 10 00https://www.ap6.se/en/
Sixth AP fund (AP6)
Long-term and active investors in unlisted companies. AP6 invests both directly (in unlisted companies) and indirectly (through external funds). Direct investments are primarily made together with other financial investors who share AP6’s values and have a long-term investment horizon.
AP6 was established in 1996 as a closed fund, which means that there are no inflows or outflows of capital linked to the rest of the pension system. It is also the only AP fund which, by law, is specialised in investments in unlisted assets. More information is available at www.apfond6.se
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