Reinet Investments S.C.A. Annual Report at 31 March 2024
REINET INVESTMENTS S.C.A.
Annual Report at 31 March 2024
REINET INVESTMENTS S.C.A.
1 Highlights
2 Performance
4 Management report
4 Chairman’s commentary
6 Business overview
29 Corporate governance
37 Sustainability report
43 Report of the Board of Overseers
44 Financial statements
45 Consolidated financial statements
45 Consolidated balance sheet
46 Consolidated statement of comprehensive income
47 Consolidated statement of changes in equity
48 Consolidated cash flow statement
49 Notes to the consolidated financial statements
72 Audit report
75 Company financial statements
75 Balance sheet
76 Profit and loss account
77 Notes to the financial statements
81 Proposed appropriation of retained earnings
82 Audit report
84 Notice of annual general meeting
87 Exchange rates and share information
88 Statutory information
CONTENTS
Cautionary statement regarding forward-looking statements
This document contains forward-looking statements which reflect the current views and beliefs of Reinet Investments S.C.A. (the ‘Company’), as well as assumptions made by
the Company and information currently available. Words such as ‘may’, ‘should’, ‘estimate’, ‘project’, ‘plan’, ‘believe’, ‘expect’, ‘anticipate’, ‘intend’, ‘potential’, ‘goal’, ‘strategy’,
‘target’, ‘will’, ‘seek’ and similar expressions may identify forward-looking statements. Such forward-looking statements are not guarantees of future performance. Actual
results may differ materially from the forward-looking statements as a result of a number of risks and uncertainties, many of which are outside Reinet’s (as defined in the
footnote on page 1) control. The Company does not undertake to update, nor does it have any obligation to provide updates or to revise, any forward-looking statements.
Certain information included in the Management Report is text attributed to the management of investee entities. While no facts have come to our attention that lead us to
conclude that any such information is inaccurate, we have not independently verified such information and do not assume any responsibility for the accuracy or completeness
of such information.
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ANNUAL REPORT 2024
Reinet Investments S.C.A. (the ‘Company’) is a partnership limited by shares incorporated in the Grand Duchy of Luxembourg and having its registered office at
35, boulevard Prince Henri, L-1724 Luxembourg. It is governed by the Luxembourg law on securitisation and in this capacity allows its shareholders to participate
indirectly in the portfolio of assets held by its wholly-owned subsidiary Reinet Fund S.C.A., F.I.S. (‘Reinet Fund’), a specialised investment fund also incorporated in
Luxembourg. The Company’s ordinary shares are listed on the Luxembourg Stock Exchange, Euronext Amsterdam and the Johannesburg Stock Exchange; the listing on the
Johannesburg Stock Exchange is a secondary listing. The Company’s ordinary shares are included in the ‘LuxX’ index of the principal shares traded on the Luxembourg Stock
Exchange. The Company and Reinet Fund together with Reinet Fund’s subsidiaries are referred to as ‘Reinet’.
HIGHLIGHTS
The investment objective of Reinet is to achieve long-term capital growth.
Reinet’s strategy is to work with experienced partners to invest in unique opportunities focusing on value creation for
investors.
• Reinet’s net asset value of € 6.2 billion reflects a compound growth rate of 8.8 per cent per annum in euro terms, since March 2009,
including dividends paid
• The net asset value at 31 March 2024 reflects an increase of € 464 million or 8.1 per cent from € 5 720 million at 31 March 2023
• Net asset value per share at 31 March 2024: € 34.02 (31 March 2023: € 31.46)
• Commitments totalling € 61 million in respect of new and existing investments were made during the year, with a total of €128million
funded
• Dividends from British American Tobacco p.l.c. during the year amounted to € 130 million
• Inaugural dividend of € 57 million from Pension Insurance Corporation Group Limited
• Reinet dividend of € 0.30 per share, amounting to some € 55 million (excluding treasury shares), paid during the year
• Proposed Reinet dividend of € 0.35 per share payable after the 2024 annual general meeting
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
HIGHLIGHTS
PERFORMANCE
NET ASSET VALUE PER SHARE
The NAV per share of the Company is calculated by dividing the
NAV by the number of shares outstanding (excluding treasury
shares) of 181 790 891 (31 March 2023: 181 790 891).
31 March 2024 31 March 2023
Shares in issue 195 942 286 195 942 286
Treasury shares (14 151 395) (14 151 395)
Net shares 181 790 891 181 790 891
€ m € m
NAV (see page 6) 6 184 5 720
€ per share € per share
NAV per share 34.02 31.46
SHARE PRICE
The Company’s indicative share price as quoted on the Luxembourg
Stock Exchange increased by 18.1 per cent in the year from € 18.80
at 31 March 2023 to € 22.20 at 31 March 2024, with the highest
trade being at € 23.00 during the year. The total shareholder return
since inception (taking into account the initial price of € 7.1945
and including dividends paid) is 8.3 per cent per annum. The
growth in NAV, including dividends paid, reflects an 8.8 per cent
compounded increase since March 2009. The Company’s ordinary
shares are listed on the Luxembourg Stock Exchange, Euronext
Amsterdam and the Johannesburg Stock Exchange; the listing on
the Johannesburg Stock Exchange is a secondary listing.
Share prices as at 31 March 2024 and 31 March 2023 were as
follows:
31 March 2024 31 March 2023
ZAR EUR ZAR EUR
Luxembourg – 22.20 – 18.80
Amsterdam – 22.20 – 19.00
Johannesburg 458.23 – 365.06 –
NET ASSET VALUE
The net asset value (‘NAV’) comprises total assets less total liabilities,
and equates to total equity under International Financial Reporting
Standards. The increase in the NAV of € 464 million during the year
reflects increases in the estimated fair value and gains realised on
certain investments including Pension Insurance Corporation Group
Limited (‘Pension Corporation’), other listed investments, Trilantic
Capital Partners, TruArc Partners and NanoDimension funds
together with dividends received from British American Tobacco
p.l.c. (‘BAT’) and Pension Corporation. Offsetting these increases are
decreases in the estimated fair value of certain investments including
BAT, Prescient China funds and Milestone China Opportunities
fund together with the dividend paid by the Company and expenses
in respect of management and performance fees. Details of the
Company’s NAV and details of movements in key investments can be
found on pages6and 7 of this report.
Reinet records its assets and liabilities in euro; the strengthening of
sterling and the US dollar against the euro has resulted in an overall
increase in the value of certain assets and liabilities in euro terms.
Applying current year-end exchange rates to the March 2023 assets
and liabilities would have resulted in an increase in the March 2023
NAV of some € 129 million.
SHARE BUYBACK PROGRAMME
As at 31 March 2024, there was no share buyback programme in
progress.
The Company repurchased 14 151 395 ordinary shares between
November 2018 and May 2022 under five share buyback
programmes. The cost of the ordinary shares repurchased amounted
to € 222 million, plus transaction costs.
Details of each completed share buyback programme to date can be
found in note 8 to the consolidated financial statements.
All ordinary shares repurchased are held as treasury shares.
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ANNUAL REPORT 2024
DIVIDEND
The Company paid a dividend of € 0.30 per share in September2023
(September 2022: € 0.28 per share). A dividend of € 0.35 per share
is proposed for the current financial year, subject to approval by
shareholders at the annual general meeting in August 2024.
GLOBAL MARKETS BACKDROP
During the year, global markets continued to be impacted by
the effects of the Ukraine crisis, turmoil in the Middle East, high
interest rates and inflation. Whilst inflation has started to fall,
high prices continue to put significant pressure on households and
consumers as many central banks hold interest rates at current levels
to mitigate the inflation concerns. The extent and impact of these
factors remain uncertain.
Reinet has no direct exposure to Russia, Ukraine or the Middle
East through its underlying investments or banking relationships
and has not experienced any significant direct impacts in respect
of interest rate fluctuations or inflation. Reinet has various banking
relationships with highly rated institutions, and a well-diversified
approach to cash and liquidity management.
Reinet continues to value its investments in line with the
International Private Equity and Venture Capital Valuation
(‘IPEV’) guidelines and its approved valuation procedures and
methodologies. All investment valuations have been prepared
using latest available data, including exchange rates and listed share
prices as at 31March2024. Discussions have taken place with fund
managers and investee companies to determine any significant
changes in value and any impacts related to the various geo-political
areas of conflict, volatility in stock and currency markets, interest
rates, inflation and exposure to certain financial institutions. Future
valuations will take into account any new impacts of the above,
which could affect the valuation of underlying investments.
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REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
CHAIRMAN’S COMMENTARY
Dear Shareholder,
OVERVIEW
During the past year we have seen interest rates and inflation starting
to decline in some major economies with available liquidity from
the private and banking sectors for capital investments showing
early signs of improvement, however the costs thereof remain high.
Reinet’s portfolio remains well positioned to manage through these
challenges with sufficient liquid resources on hand.
Capital invested during the year amounted to some € 128 million,
which was mostly in respect of funds managed by Trilantic Capital
Partners, TruArc Partners and Coatue.
Reinet has cash resources of some € 357 million and access to
additional funds by way of additional borrowing facilities to meet
investment obligations and other opportunities as they arise.
Since its inception in 2008, Reinet has generated an annual return
of 8.3 per cent for its investors based on the Reinet share price, with
the underlying net asset value reflecting an 8.8 per cent compounded
increase since March 2009.
RESULTS
At 31 March 2024, Reinet’s net asset value amounted to some
€ 6.2 billion, an increase of € 464 million or 8.1 per cent from
31March 2023. The increase reflects the increase in value of Pension
Corporation together with the receipt of significant dividends from
both Pension Corporation and British American Tobacco, offset
primarily by a decrease in the share price of British American
Tobacco. The strengthening of sterling against the euro in the year
also contributed to the positive results.
BUSINESS DEVELOPMENTS
Pension Corporation’s adjusted own funds increased from
£5.9billion to £ 6.3 billion over the last year with new business
premiums increasing from £ 4.1 billion to £ 6.9 billion mainly due
to the conclusion of the largest ever UK bulk annuity transaction
in respect of a buy-in with the Trustees of two schemes sponsored
by RSA Group. The board of Pension Corporation proposed an
inaugural dividend of 7.5 pence per ordinary share which was
paid to shareholders in May 2023. Reinet’s share of this dividend
amounted to some £ 50 million. In April 2024, the shareholders of
Pension Corporation approved a second dividend of 11 pence per
ordinary share which was paid to shareholders in May 2024. Reinet’s
share of this second dividend amounted to some £73million.
The investment in British American Tobacco decreased in value in the
year due to its share price decreasing from £ 28.41 at 31March2023
to £ 24.06 at 31 March 2024. At the British American Tobacco
annual general meeting in April 2024, shareholders approved
a dividend increase of 2 per cent to £ 2.36 per share. British
American Tobacco continues to follow its strategic path to ‘A Better
Tomorrow’ which means it is committed to building a smokeless
world by migrating its cigarette consumers actively, sustainably and
responsibly to reduced risk, smokeless alternatives. Its board and
leadership team remain focused on securing long-term, sustainable
value creation and have set a target of 50 per cent of revenue from
‘non-combustibles’ by 2035.
TruArc continues to pursue new opportunities and in early 2024
launched the TruArc Structured Opportunities Fund, a fund
seeking to deliver flexible capital to middle market entities in North
America, also predominantly in the Speciality Manufacturing and
Business Services sectors, by investing across the capitalisation from
structured debt to non-control equity. Reinet committed some
€17million to TruArc Structured Opportunities Fund as part of
the first close and expects to commit further amounts at subsequent
closings. Reinet’s total outstanding commitment to TruArc managed
funds now stands at € 122 million, with some €330million invested
to date.
In 2009, Reinet announced its decision to invest in the private equity
management business formerly owned by Lehman Brothers, the
business was subsequently renamed Trilantic Capital Partners. As
Reinet’s first private equity fund investment, uninvested limited partner
commitments were taken over in respect of Trilantic Capital Partners’
Fund IV North America and Fund IV Europe. 15 years later, practically
all underlying investments in these two funds have been realised.
Over the years, Reinet has invested in a total of six funds managed by
Trilantic Capital Partners, with € 517 million invested, €597 million
distributed and a remaining carrying value of € 443million. During
the past year, total capital distributions of €55million were received
and capital contributions of € 23 million paid.
The Coatue Structured Funds continue to focus on privately
negotiated structured financing transactions using their sector
experience and platform resources to source these proprietary
transactions. Coatue seeks to employ a strategy that will
opportunistically fund both offensive and defensive transactions,
predominantly in the US technology sector. Reinet invested an
additional € 20 million during the year, with a total outstanding
commitment of € 209 million.
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ANNUAL REPORT 2024
DIVIDEND
The Board of Directors of Reinet Investments Manager S.A.
proposes a dividend of € 0.35 per share, payable in September 2024.
This represents a 16.67 per cent increase from last year.
OUTLOOK
In 2023, the World Health Organisation officially declared the end
of the COVID-19 pandemic however, we are faced with the ongoing
Ukraine crisis, increasing unrest in the Middle East, heightened
global geopolitical tensions, continuing elevated interest rates and
stubborn inflation.
We will continue to seek new investment opportunities and
partnerships which fulfil our objective of providing long term
capital growth and to support our existing portfolio companies to
be successful against the global backdrop set out above.
As with all conscientious investors we will need to generate returns
for our shareholders from sustainable business practices and try to
mitigate the ever-increasing risks posed by global warming. The
introduction of the Corporate Sustainability Reporting Directive in
the European Union will bring enhanced sustainability reporting
requirements over the next few years. As we see in other parts of the
world, investors and businesses will need to focus more resources
on reducing their impact on the environment while promoting
investment in sustainable business practices. Reinet’s two largest
investments, Pension Corporation and British American Tobacco
already have well developed strategies in this regard.
I would like to thank Reinet’s Directors, Board of Overseers,
management and employees for their commitment to Reinet and
to our partners in the investment community for their contribution
toReinet’s performance during the year.
Johann Rupert
Chairman
Reinet Investments Manager S.A.
Luxembourg, 27 May 2024
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REINET INVESTMENTS S.C.A.
BUSINESS OVERVIEW
Reinet Investments S.C.A. (the ‘Company’) has determined that it meets the definition of an investment entity in terms of International Financial
Reporting Standards (‘IFRS’) 10. The net asset value, the income statement and the cash flow statement included in this business overview have
however been presented in a more comprehensive format than required by IFRS in order to provide readers with detailed information relating
to the underlying assets and liabilities.
NET ASSET VALUE
The net asset value (‘NAV’) at 31 March 2024 and 2023 comprised:
31 March 2024 31 March 2023
€ m % € m %
Listed investments
British American Tobacco p.l.c. 1 359 22.0 1 561 27.3
Other listed investments 93 1.5 83 1.4
Unlisted investments
Pension Insurance Corporation Group Limited 3 436 55.6 2 787 48.7
Private equity and related partnerships 1 167 18.9 1 138 19.9
Trilantic Capital Partners 443 7.2 472 8.2
Funds and related general partners
TruArc Partners 372 6.0 301 5.3
Funds, co-investment opportunities and management company
Coatue funds 73 1.2 50 0.9
Asian private equity companies and portfolio funds 171 2.8 219 3.8
Milestone China Opportunities fund 13 44
Prescient China funds and management company 124 143
Asia Partners funds 34 32
Specialised investment funds 108 1.7 96 1.7
NanoDimension funds and co-investment opportunities 107 94
Other fund investments 1 2
United States land development and mortgages 21 0.3 26 0.5
Other investments 75 1.2 58 1.0
Total investments 6 151 99.5 5 653 98.8
Cash and liquid funds 357 5.7 288 5.1
Bank borrowings (229) (3.7) (217) (3.8)
Other liabilities
Minority interest, fees payable and other liabilities, net of other assets (95) (1.5) (4) (0.1)
Net asset value 6 184 100.0 5 720 100.0
All investments are held, either directly or indirectly, by Reinet Fund S.C.A., F.I.S. (‘Reinet Fund’). The Company and Reinet Fund together
with Reinet Fund’s subsidiaries are referred to as ‘Reinet’.
MANAGEMENT REPORT
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ANNUAL REPORT 2024
INFORMATION RELATING TO CURRENT KEY INVESTMENTS AT 31 MARCH 2024
Committed
amount
(1)
in millions
Remaining
committed
amount
(1)
in millions
Invested
amount
(2)
in millions
Realised
amount
(2)
in millions
Current fair
value
(1)
in millions
Total realised
and
unrealised
value
(3)
in millions
Listed investments
British American Tobacco p.l.c. EUR – – 1 739 3 415 1 359 4 774
GBP – – 1 418 2 866 1 162 4 028
Other listed investments EUR – – 127 68 93 161
USD – – 146 78 100 178
Unlisted investments
Pension Insurance EUR – – 1 315 57 3 436 3 493
Corporation Group Limited GBP – – 1 112 50 2 938 2 988
Trilantic Capital Partners EUR 596 95 517 597 443 1 040
Euro investment EUR 85 19 66 149 44 193
US dollar investment
(4)
USD 552 82 514 524 431 955
TruArc Partners EUR 464 122 330 225 372 597
USD 500 132 368 253 402 655
Coatue funds EUR 278 209 70 – 73 73
USD 300 225 75 – 79 79
Asian private equity companies
and portfolio funds
Milestone China Opportunities
funds and management
company
EUR – – 130 164 13 177
USD – – 169 185 14 199
Prescient China funds and
management company
EUR – – 79 4 124 128
USD – – 94 4 134 138
Asia Partners funds EUR 67 37 28 – 34 34
USD 73 40 33 – 37 37
Specialised investment funds
NanoDimension funds and
co-investment opportunities
EUR 173 47 123 62 107 169
Euro investment EUR – – 4 5 – 5
US dollar investment USD 187 51 136 68 115 183
United States land development
and mortgages
EUR 198 5 160 71 21 92
USD 214 5 209 78 23 101
(1) Calculated using year-end foreign exchange rates.
(2) Calculated using actual foreign exchange rates at transaction date.
(3) Total of realised proceeds and current fair value.
(4) The invested amount for Trilantic Capital Partners includes an initial payment of $ 10 million.
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REINET INVESTMENTS S.C.A.
Reinet seeks, through a range of investment structures, to build partnerships with other investors, specialised fund managers and entrepreneurs
to find and develop opportunities for long-term value creation for its shareholders.
Since its formation in 2008, Reinet has invested some € 3.7 billion and at 31 March 2024 committed to provide further funding of € 559 million
to its current investments. Details of the funding commitments outstanding are given in the table on page 22 of this report. New commitments
during the year under review amounted to € 61 million, and a total of € 128 million was funded during the year.
LISTED INVESTMENTS
BRITISH AMERICAN TOBACCO P.L.C.
The investment in British American Tobacco p.l.c. (‘BAT’) remains one of Reinet’s largest
investments and is kept under constant review, considering the company’s performance, the
industry outlook, cash flows from dividends, stock market performance, volatility and liquidity.
Luc Jobin, Chairman, and Tadeu Marroco, Chief Executive, writing in the BAT annual report for
2023 commented:
Luc Jobin: ‘Our strategy and purpose were discussed extensively during 2023. The result of these
discussions was the decision to provide greater clarity on what we mean by ‘A Better Tomorrow’.
It means we are committed to building a smokeless world. This is a commitment to migrate our
cigarette consumers actively, sustainably and responsibly to reduced risk, smokeless alternatives.
We believe that growth within the smokeless category will be driven by sustained investment in
our brands and targeted innovation to respond to evolving consumer preferences and tastes. While
sustained volatility and uncertainty will continue to present challenges, we believe BAT remains
well-positioned and resilient. We are diversified by category, price point and geography. Our
smokeless portfolio has been designed to take advantage of sectorial shifts and our people are highly
engaged with a track record of delivery during uncertain times. BAT’s board and leadership team
remain focused on securing long-term, sustainable value creation, by nurturing BAT’s culture,
building our brands and delivering ‘A Better Tomorrow’ for our stakeholders.’
Tadeu Marroco: ‘During 2023, the underlying strengths of BAT were reflected in our performance,
despite a challenging environment. While total group revenue declined 1.3 per cent, revenue
at constant currency was up 1.6 per cent despite the negative impact due to the sale of Russia
and Belarus partway through the year. There was another strong performance from our ‘New
Categories’ which are now profitable at the category contribution level, driven by higher revenue
(up 15.6 per cent, or 17.8 per cent on a constant currency basis). We currently have 24 million
consumers of ‘Non-Combustible’ products and revenue from these products now accounts for
16.5per cent of group revenue. As a business, we are committed to becoming a predominantly
smokeless business, targeting 50 per cent of our revenue from ‘Non-Combustibles’ by 2035. We are
an organisation ready to deliver, with operational excellence and an ability to flexibly manage our
capital allocation decisions for the benefit of all stakeholders.’
During the year under review, dividend income recorded from BAT amounted to € 130 million
(£ 112 million), being BAT’s second, third and fourth 2023 quarterly dividends, together
with the first 2024 quarterly dividend of some € 33 million (£ 28 million) with a record date
of 22March 2024. The first 2024 quarterly dividend was paid on 2 May 2024 and has been
included as a receivable in the NAV as at 31 March 2024, due to the record date falling within
this financial year.
Reinet holds 48.3 million shares in BAT (31 March 2023: 48.3 million), representing some
2.16 per cent of BAT’s issued share capital.
The value of Reinet’s investment in BAT amounted to € 1 359 million at 31 March 2024
(31March 2023: € 1 561 million), being some 22.0 per cent of Reinet’s NAV. The decrease in
value reflects the decrease in the BAT share price on the London Stock Exchange from £ 28.41
at 31March 2023 to £ 24.06 at 31 March 2024 offset by the strengthening of sterling against
the euro during the year.
Further information on BAT is available in its combined Annual and Sustainability report at www.bat.com
MANAGEMENT REPORT
BUSINESS OVERVIEW
CONTINUED
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ANNUAL REPORT 2024
OTHER LISTED INVESTMENTS
Other listed investments comprised:
31 March 2024
€ m
31 March 2023
€ m
Grab Holdings Limited 31 29
Cartesian Therapeutics, Inc. * 1 2
Soho China Limited 3 7
SPDR Gold shares 44 39
Twist Bioscience Corporation 14 6
93 83
* formerly Selecta Biosciences Inc.
GRAB HOLDINGS LIMITED
Grab Holdings Limited (‘Grab’) is a leading superapp platform in Southeast Asia, providing
everyday services that matter to consumers, including food deliveries, mobility and the e-wallet
segment of financial services. Grab offers a wide range of on-demand services across 480 cities in
eight countries.
Reinet holds 10 573 666 shares in Grab with a market value of € 31 million (31 March 2023:
€29 million). The increase in value mainly reflects the increase in the share price during the year.
Further information on Grab is available at www.grab.com
CARTESIAN THERAPEUTICS, INC.
In November 2023, Selecta Biosciences, Inc. merged with Cartesian Therapeutics, Inc. (‘Cartesian’),
a clinical-stage biotechnology company pioneering RNA cell therapies for autoimmune diseases.
The combined company is now known as Cartesian Therapeutics, Inc. and its Nasdaq ticker
symbol changed to ‘RNAC’.
Cartesian is also a portfolio company of the NanoDimension funds.
Reinet holds 1 395 460 shares with a market value of € 1 million as at 31 March 2024
(31March2023: € 2 million). The decrease in value mainly reflects the decrease in the share price
during the year.
Further information on Cartesian is available at www.cartesiantherapeutics.com
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REINET INVESTMENTS S.C.A.
SOHO CHINA LIMITED
Soho China Limited (‘Soho’) is a Chinese office developer focused on developing and leasing
properties in the central business districts of Beijing and Shanghai. Soho developments are known
for their modern architecture, with designs from architects such as Zaha Hadid and Japanese
architect Kengo Kuma.
Reinet holds 47 million shares with a market value of € 3 million as at 31 March 2024
(31 March 2023: € 7 million). The decrease in value mainly reflects the decrease in the share price
during the year.
Further information on Soho is available at www.sohochina.com
SPDR GOLD SHARES
SPDR Gold shares (‘GLD’) is the largest physically backed gold exchange traded fund in the
world. Over the long term, gold can provide a hedge against inflation and offer some protection
against value changes in turbulent economic and political times.
Reinet holds 230 000 shares with a market value of € 44 million as at 31 March 2024
(31 March 2023: € 39 million). The increase in value mainly reflects the increase in the value of
gold during the year.
Further information on GLD is available at www.spdrgoldshares.com/usa
TWIST BIOSCIENCE CORPORATION
Twist Bioscience Corporation (‘Twist’) is involved in the fields of medicine, agriculture, industrial
chemicals and data storage, by using synthetic DNA tools, and has created a revolutionary silicon-
based DNA synthesis platform that offers precision at a scale otherwise unavailable.
Reinet holds 444 497 shares in Twist with a market value of € 14 million (31 March 2023:
€ 6 million). The increase in value mainly reflects the increase in the share price during the year.
Further information on Twist is available at www.twistbioscience.com
BUSINESS OVERVIEW
CONTINUED
MANAGEMENT REPORT
REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
UNLISTED INVESTMENTS
Unlisted investments are carried at their estimated fair value. In determining fair value, Reinet Fund Manager S.A. (the ‘Fund Manager’) relies
on audited and unaudited financial statements of investee companies, management reports and valuations provided by third-party experts.
Valuation methodologies applied include the NAV of investment funds, discounted cash flow models and comparable valuation multiples, as
appropriate. The third-party valuation reports and key assumptions used within these reports are reviewed by the external auditors.
PENSION INSURANCE CORPORATION GROUP LIMITED
Pension Insurance Corporation Group Limited’s (‘Pension Corporation’) wholly-owned
subsidiary, Pension Insurance Corporation plc (‘Pension Insurance Corporation’), is a leading
provider in the UK pension risk transfer market.
During 2023, Pension Insurance Corporation concluded new business with premiums of
£ 6.9 billion (2022: £ 4.1 billion).
At 31 December 2023, Pension Corporation reported it held £ 46.8 billion in assets
(31 December 2022: £ 41.2 billion) and insurance liabilities amounted to £ 41.2 billion
(31December 2022: £ 33.7 billion). The increase in value of both assets and liabilities is due to
new business written, partly offset by payments made to policyholders.
To date, Pension Insurance Corporation has insured 339 900 pension fund members
(31December 2022: 302 200). Clients include FTSE 100 companies, multinationals and the
public sector.
Pension Insurance Corporation has a total of £ 1.8 billion (31 December 2022: £ 1.6 billion)
Tier2 subordinated notes and £ 450 million (31 December 2022: £ 450 million) Tier 1 restricted
notes outstanding. In September 2023, Fitch affirmed its Insurer Financial Strength rating at A+
(Strong) and Long-Term Issuer Default rating at A. The reported Solvency II capital ratio as at
31 December 2023 was 211 per cent (31 December 2022: 225 per cent).
During 2023, Pension Corporation paid an inaugural dividend of 7.5 pence per ordinary share.
Reinet’s share of the dividend amounting to some € 57 million (£ 50 million) was received in
May 2023.
In April 2024, the shareholders of Pension Corporation approved a dividend of 11.0 pence per
ordinary share. Reinet’s share of the dividend amounting to some € 85 million (£ 73 million) was
received in May 2024. Reinet has not recorded a receivable as at 31 March 2024, as the approval
date falls outside this financial year.
Reinet’s shareholding in Pension Corporation remained at 49.5 per cent in the year under review.
Tracy Blackwell, Chief Executive Officer and Dom Veney, Chief Financial Officer of Pension Insurance
Corporation, commented:
Tracy Blackwell: ‘The Group had a very strong year, and our results demonstrate sustainable
growth, increased profitability, and excellent customer service. During the year we completed
the landmark £ 6.2 billion buy-in of two pension schemes sponsored by RSA Group, we made
pension payments of £ 2.1 billion, our highest ever, with policyholder satisfaction levels of
99.3per cent, and we have now paid £ 13.6 billion in pensions in total.
We are delighted to have continued investing in vital UK infrastructure, creating considerable
social value, including funding the UK’s first reservoir in over 30 years. We have now invested
£ 13 billion in UK infrastructure and £ 29 billion in the UK in total. Our conservatively
invested portfolio stands at £ 46.8 billion, and we were pleased to have avoided problems with
US regional banks, commercial real estate, and those caused by the demise of Credit Suisse.
Our balance sheet continues to be robust with a year-end solvency ratio of 211 per cent, which
means we went into the new year well placed to help trustees looking to secure their member
benefits in what we expect to be a very busy year. During the first two months of 2024 we
completed £ 1.5 billion of new business, with an industry pipeline of £ 50 billion expected to
complete this year. Pension Insurance Corporation is well positioned to fulfil its purpose, which
is to pay the pensions of its current and future policyholders, as well as to play a leading role in
the future growth of the UK pension risk transfer market.’
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CONTINUED
MANAGEMENT REPORT
PENSION INSURANCE CORPORATION GROUP LIMITED
CONTINUED
Dom Veney: ‘A strong set of financial results representing the continued delivery of our focused
strategy despite volatile markets. Market volatility continued to be high in 2023, with
stubbornly high inflation, large swings in UK and international interest rates and narrowing
credit spreads.
We maintain a prudent investment and hedging strategy that prioritises long-term stability
and security for our policyholders, which enabled us to navigate through this volatility. Our
investment strategy is to select assets that generate cash flows to match our future claims payments
in both timing and amount, therefore the value of our assets and liabilities move broadly in
tandem as factors such as interest and inflation rates change.
IFRS profit before tax amounted to £ 303 million (2022: £ 93 million). From 1 January 2023
we adopted IFRS 17 “Insurance Contracts” the new global insurance accounting standard,
which has fundamentally changed how companies account for insurance and reinsurance
contracts. Key differences between the measurement of insurance contracts under IFRS 4 and
IFRS 17 include the deferral of new business profits at inception. For a growing business such
as Pension Insurance Corporation, this means that statutory profit recognition is slower under
IFRS 17 than IFRS 4. IFRS 17 requires that new business profits are released over the length
of the contracts.’
Reinet’s investment in Pension Corporation is carried at an estimated fair value of € 3436million
at 31 March 2024 (31 March 2023: € 2 787 million). This value takes into account Pension
Corporation’s adjusted equity own funds value at 31 December 2023 of £ 6.3 billion
(31December2022: £ 5.9 billion), corresponding valuation multiples drawn from industry data
for a selected UK insurance peer group as at 31 March 2024, and a discount of 10 per cent which
takes into account the illiquid nature of Reinet’s investment.
The investment in Pension Corporation increased in value by € 649 million which includes an
increase of some € 340 million in respect of the increase in market multiples following a generally
strong public market performance for the peer group over the 12 months, together with an
increase of some € 210 million due to the movement on Pension Corporation’s adjusted equity
own funds value from 31 December 2022 to 31 December 2023 and some € 100 million due to
the strengthening of sterling against the euro in the year under review.
The investment in Pension Corporation represents some 55.6 per cent of Reinet’s NAV at
31March 2024, compared to 48.7 per cent at 31 March 2023.
Pension Corporation believes sustainability is fundamental to the delivery of its purpose to pay
policyholders now and for decades to come. Its sustainability strategy includes: continuing to
build a secure and sustainable business; to carry on leading as a responsible corporate citizen; and
to keep on driving long-term value growth. It has four distinct pillars which ensure alignment
of its corporate strategy and actions to its purpose: long-term sustainable business; being a
responsible investor; protecting the environment and making communities sustainable, safe and
inclusive. Pension Insurance Corporation is one of the founding signatories of the Sustainability
Principles Charter for the Bulk Purchase Annuity process and was also accepted as a signatory to
the UK Stewardship Code.
Further information on Pension Corporation and its sustainability reporting is available at
www.pensioncorporation.com
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PRIVATE EQUITY AND RELATED PARTNERSHIPS
Where Reinet invests in funds managed by third parties, its philosophy is to partner with the managers of such funds and to share in fees
generated by funds under management. This is the case with funds managed by Trilantic Capital Partners, TruArc Partners, Milestone Capital
and Prescient Investment Management China. Under the terms of the investment advisory agreement (the ‘Investment Advisory Agreement’),
entered into by the Fund Manager and Reinet Investment Advisors Limited (the ‘Investment Advisor’), Reinet pays no management fee to the
Investment Advisor on such investments except in the case where no fee or a reduced fee below 1 per cent is paid to the third-party manager. In
such cases, the aggregate fee payable to the Investment Advisor and the third-party manager is capped at 1 per cent.
TRILANTIC CAPITAL PARTNERS
Trilantic Capital Partners (‘Trilantic’) is composed of Trilantic North America and Trilantic
Europe, two separate and independent private equity investment advisors focused on making
controlling and significant minority interest investments in companies in their respective
geographies. Trilantic North America currently targets investments in the business services and
consumer sectors, and currently manages five fund families. Trilantic Europe primarily targets
investments in the industrials, consumer and leisure, telecommunication, media and technology,
business services and healthcare sectors, and currently manages three fund families.
Reinet and its minority partner invest in certain of the Trilantic general partnerships (‘Trilantic
Management’). Reinet and its minority partner, through Reinet TCP Holdings Limited, invest
in two of the current funds under Trilantic’s management. Reinet also directly invests in three
additional funds under Trilantic’s management. The terms of investment applicable to Reinet’s
investment in the Trilantic funds provide that Reinet will not pay any management fees or carried
interest. In addition, Reinet receives a share of the carried interest payable on the realisation of
investments held in the funds, once a hurdle rate has been achieved.
Reinet TCP Holdings Limited invests in Trilantic Capital Partners IV L.P. (‘Fund IV’) and
Trilantic Capital Partners IV (Europe) L.P.; these funds are in the process of realising the
remaining underlying investments.
In 2012, Reinet invested in Trilantic Capital Partners V (North America) L.P. (‘Fund V’) and
in 2014, in Trilantic Energy Partners (North America) L.P. (‘TEP I’). These US-based funds
are focused on North American opportunities. TEP I disposed of its last investment and was
subsequently dissolved in 2024 and Fund V is in the process of realising the remaining underlying
investments.
In 2017, Reinet invested in Trilantic Capital Partners VI Parallel (North America) L.P. (collectively
with its parallel vehicles, ‘Fund VI’) and Trilantic Energy Partners II Parallel (North America)
L.P. (collectively with its parallel vehicles, ‘TEP II’). These US-based funds are focused on North
American opportunities with TEP II being especially focused on the energy industry sector.
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TRILANTIC CAPITAL PARTNERS
CONTINUED
Charlie Ayres, Chairman of Trilantic North America and the Executive Committee of Trilantic
Capital Partners, commented:
‘Investor optimism persists despite significant turmoil in the bank industry during 2023, including
failures at Silicon Valley Bank and Signature Bank; UBS’ takeover of its rival Credit Suisse; and
JPMorgan’s takeover of First Republic.
Market statistics in the private equity arena were lackluster during 2023. Buyout deal activity
and exit activity remained sluggish, and purchase prices softened. The IPO market in the Americas
picked up from low 2022 levels but remained muted compared to historical levels. In 2023, the
number of IPOs in the Americas was up 15 per cent over 2022. America’s IPO proceeds were up
nearly 3x due to several large deals.
Financing for new private equity-backed investments remains discerning. Higher interest rates
have subdued appetite for highly-levered buyouts and put downward pressure on pricing. Private
equity investors hold significant dry powder, and with an improving macro backdrop, deal
volume will likely pick up during 2024 and the bid-ask spread between buyers and sellers will
resolve. Asinvestors look forward to 2024, Fed policy, inflation, geopolitical events and the U.S.
presidential election will likely remain key influencers on their outlook.
Key highlights from the past year include:
• Completed 3 significant realisations across Funds V and VI North America, with total proceeds
of $ 614 million,
• The Fund VI North America portfolio completed 18 add-on acquisitions in 2023,
• Total portfolio value accretion of $ 91 million during 2023,
• We continue to manage an active portfolio of assets that we believe have strong balance sheets
and below-market leverage companies.
We are on track to publish our 4th Annual ESG Report in May 2024. We continue to focus on
KPIs influenced by ILPA’s ESG Convergence project. We are proud signatories to both the U.N.
Principals for Responsible Investing and ILPA’s Diversity in Action initiative.’
Vittorio Pignatti-Morano, Chairman of Trilantic Europe, commented:
‘The macroeconomic scenario at the beginning of 2023 made us wary of rampant inflation, which
central banks announced had to be fought with harsh monetary policy, and which most economists
predicted would trigger a recession. Markets were pricing-in this gloomy scenario after having
already suffered an 18 per cent drop in equity indexes and an equally disastrous performance
in the bond market the year prior. In Q4 2023, the narrative changed: (i) inflation appears to
have been primarily triggered by corporate margin expansion, rather than by wage increases or
excessive consumption, (ii) interest rate hikes did not dampen economic activity and, especially in
the US, consumers continued spending, unemployment remained at a record low, and recessionary
fears shifted from red alert to mild, (iii) central banks, reverting to their original mission of
protection of the value of money, changed their narrative as well, they began by stating that signs
of inflation abating could allow them to halt hiking rates and then, in Q4 2023, they hinted at
the possibility of rate reductions in the spring or summer of 2024 and (iv) a slowdown in Chinese
domestic demand shifted local producers’ focus to exports to US and Europe at reduced prices,
hence contributing to ‘exporting deflation’.
For Trilantic Europe, the year proved overall positive, despite its complexities. We continued our
active portfolio management across the portfolio and strengthened our own organisation with the
appointment of Javier Olascoaga as Managing Partner, and eight new team additions in the last
twelve months, including the appointment of two new partners.’
BUSINESS OVERVIEW
CONTINUED
MANAGEMENT REPORT
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TRILANTIC CAPITAL PARTNERS
CONTINUED
Reinet’s investment in Trilantic Management and the above funds is carried at the estimated fair
value of € 443 million at 31 March 2024 (31 March 2023: € 472 million) of which €3million
(31 March 2023: € 2 million) is attributable to the minority partner. The estimated fair value
is based on audited valuation data provided by Trilantic Management at 31 December 2023
adjusted for changes in the value of listed investments included in the portfolios and cash
movements up to 31 March 2024.
The decrease in the estimated fair value is due to net capital distributions of € 55 million, offset
by capital contributions of € 23 million, increases in the estimated fair values of underlying
investments and the strengthening of the US dollar against the euro in the year.
During the year under review, gains of € 34 million (31 March 2023: € 21 million) were realised.
In addition, carried interest of € 3 million (31 March 2023: € 6 million) and current income of
€ 4 million (31 March 2023: € 1 million) were received.
Further information on Trilantic is available at www.trilantic.com
TRUARC PARTNERS FUNDS, CO-INVESTMENT OPPORTUNITIES AND
MANAGEMENT COMPANY
TruArc Partners LP (‘TruArc’) is a middle market focused investment management firm led by
a team that has worked together since 2005 and has deployed over $ 3 billion of capital. TruArc
focuses on companies in attractive sub-sectors of Specialty Manufacturing and Business Services.
The TruArc investment team works closely with its operating partners and portfolio management
teams in an effort to generate value through a transformational growth strategy focused on both
organic growth and acquisitions.
Reinet is invested in Snow Phipps II, Snow Phipps III, TruArc Fund IV, in two co-investment
opportunities alongside Snow Phipps III, and in the management company.
In April 2023, Reinet committed an additional € 2 million in respect of the co-investments.
Thefull amount was funded in May 2023. In February 2024, Reinet committed € 17 million
($ 18 million) to TruArc Structured Opportunities Fund, LP as part of the first close. This
amount will increase at subsequent closings. As at 31 March 2024, no capital has been called.
TruArc Structured Opportunities Fund intends to offer resources and capital in close partnership
with controlling shareholders and management to support the growth of these investee entities.
TruArc’s bespoke capital solutions will seek to deliver flexible capital to middle market entities
in North America, also predominantly in the Speciality Manufacturing and Business Services
sectors by investing across the capitalisation from structured debt to non-control equity.
Ogden Phipps, Co-Managing Partner of TruArc Partners, commented:
‘2023 was a year of continued positive momentum for TruArc. We completed the acquisition
of two new platform companies in Fund IV, bringing the total to seven platform companies in
that fund as of the end of December. Each company is investing in organic initiatives to drive
transformational growth. Commercially-focused initiatives include sales force expansion, digital
marketing, rebranding and tech-enablement. Operationally-focused initiatives include technology
infrastructure, footprint optimization, acquisition integration and procurement strategies. A key
component of our investment approach is to execute a “buy and build” value creation strategy,
and during 2023 we completed 15 add-on acquisitions across the TruArc-managed portfolio
companies that we believe are strategically important and financially accretive. We are encouraged
by the strength of our management teams as they lead our portfolio companies and seek to build
value through transformational growth across the TruArc portfolio.
In addition, we recently launched TruArc’s Structured Opportunities strategy, which is highly
complementary to our established core Private Equity strategy. Structured Opportunities seeks to
provide customized securities to middle market Specialty Manufacturing and Business Services
companies in need of flexible and dynamic capital solutions to facilitate strategic goals and address
the unique and complex needs of each transaction while bringing to bear the full resources of the
TruArc platform.’
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CONTINUED
TRUARC PARTNERS FUNDS, CO-INVESTMENT OPPORTUNITIES AND
MANAGEMENT COMPANY
CONTINUED
Reinet’s investment is carried at an estimated fair value of € 372 million at 31 March 2024
(31March 2023: € 301 million), based on the audited valuation data provided by TruArc at
31December 2023 adjusted for cash movements up to 31 March 2024.
The increase in the estimated fair value reflects net capital contributions of € 45 million, together
with increases in estimated fair values of underlying investments and the strengthening of the
USdollar against the euro in the year.
Further information on TruArc Partners is available at www.truarcpartners.com
COATUE FUNDS
Coatue Management L.L.C. (‘Coatue’) is a global investment firm focused on technology-related
investment opportunities led by its founder, Mr Philippe Laffont. Coatue invests in public and
private markets with an emphasis on technology, media, telecommunications, the consumer and
healthcare sectors.
Reinet is invested in Coatue Structured Offshore Feeder Fund LP and Coatue Tactical Solutions
CT Offshore Fund B LP (together the ‘Coatue Structured Funds’).
The Coatue Structured Funds seek to invest in structured investments in both publicly listed and
privately held technology companies, focusing on investments that offer downside protection
while retaining upside potential. The Coatue Structured Funds focus on privately negotiated
transactions leveraging Coatue’s sector experience and platform resources to source proprietary
transactions. Coatue seeks to employ a strategy that will opportunistically fund both offensive
and defensive transactions such as M&A, and establishing paths toward accelerating organic
growth. Coatue believes there is a substantial universe of potential investment opportunities and
that the market could produce significant structured capital opportunities.
Coatue generally focuses on companies that it believes are: 1) powered by a strong underlying
trend; 2) established winners or breakout leaders within a category or trend; 3) pursuing a large
total addressable market; 4) operating business models with strong unit economics; and 5) led by
visionary founders and experienced management teams.
Reinet’s investment is carried at an estimated fair value of € 73 million at 31 March 2024
(31March 2023: € 50 million), based on the audited valuation data provided by Coatue at
31December 2023 adjusted for cash movements up to 31 March 2024.
The increase in the estimated fair value reflects capital contributions of € 20 million, together
with increases in the value of underlying investments and the strengthening of the US dollar
against the euro in the year.
Further information on Coatue is available at www.coatue.com
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ASIAN PRIVATE EQUITY COMPANIES AND PORTFOLIO FUNDS
Milestone China Opportunities fund
Reinet is invested in Milestone China Opportunities Fund III L.P. (‘Milestone III’), a fund
managed by Milestone Capital. Milestone III is in the process of realising its remaining
underlying investments.
Milestone Capital has a strong track record in helping portfolio companies scale their operations
and become listed on either domestic or foreign stock exchanges.
Yunli Lou, Managing Partner of Milestone Capital, commented:
‘During 2023, Milestone Capital continued working closely with our portfolio companies to achieve
exits. We continued selling down our shares in a listed cosmetics e-commerce platform and achieved
a full exit in the first quarter of 2024. We also entered into definitive agreements with one medical
consumable company to fully redeem our remaining stake; the deal was closed in early 2024.
During 2023, China’s economy was weak despite its reopening after COVID-19. Full year GDP was
$ 17.5 trillion, up by 5.2 per cent year-on-year. But if measured in two-year CAGR to eliminate the
low base in 2022, GDP grew by only 4.1 per cent. Deflation pressure increased in the economy, with
CPI growing by 0.2 per cent year-on-year in 2023, the lowest growth since 2009. The property sector
continued to drag down the economy throughout the year, property development investment declined
by 9.6% year-on-year and property sales declined by 6.5 per cent year-on-year. Capital markets also
performed poorly, impacted by the weakened economy and sentiment. The government announced
a series of policies throughout the year to boost the economic growth and market confidence, such as
loosening property purchase restrictions, lowering mortgage rates and lowering bank reserve ratio.’
The investment in Milestone III is held at the estimated fair value of € 13 million (31 March 2023:
€ 44 million) based on audited financial information provided by Milestone Capital at
31 December 2023 adjusted for movements in listed investments and cash movements up to
31March 2024.
The decrease in the estimated fair value reflects capital distributions of € 11 million, together
with decreases in estimated fair values of underlying investments, offset by the strengthening of
the US dollar against the euro in the year.
During the year the investment held by Reinet in the management company was fully realised
with proceeds included in the distributions noted above. In addition, an older vintage fund
was wound up resulting in a realised loss of € 18 million, this amount had been fully provided
for in prior years. Subsequent to the year end a distribution of € 9 million was received from
MilestoneIII.
Further information on Milestone is available at www.mcmchina.com
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BUSINESS OVERVIEW
CONTINUED
Prescient China funds and management company
Reinet is invested in the Prescient China Equity Fund, the Prescient China Balanced Fund, the
Prescient China Growth Enhanced Absolute Return Fund and the management company.
The Prescient China Equity Fund uses a systematic, quantitative approach to seek long-term
capital growth by investing primarily in China ‘A’ shares listed on the Shanghai and Shenzhen
Stock Exchanges by virtue of Prescient’s Qualified Foreign Institutional Investor status granted
by the China Securities Regulatory Commission.
Prescient China Balanced Fund invests in equities following a similar strategy to the Prescient
China Equity Fund and also in bonds, cash and derivatives with the objective of generating
inflation-beating returns at acceptable risk levels.
Prescient China Growth Enhanced Absolute Return Fund aims to achieve long-term capital
growth at significantly lower return volatility than conventional multi-asset China investment
strategies. The fund will predominantly invest in mainland Chinese equities, bonds, cash, money
market instruments and derivatives.
All funds are managed by a subsidiary of Prescient Limited (‘Prescient’), a South African fund
manager, with the team based in Shanghai.
Liang Du, Portfolio Manager of Prescient, commented:
‘Over the past year a slower than expected recovery in the Chinese economy resulted in a weak
year for the Chinese equity market.
The collapse of major developers and bursting of the property bubble resulted in the slowest
growth in 30 years for China. Property makes up a large part of the average investor wealth,
with the direct and indirect impact being lower consumer confidence resulting in lower demand,
lower investment and lower growth.
Although the property sector has been a drag on the overall economy, the rest of the economy
is growing at a healthy rate, fast moving economic data shows a slowly improving economy
with the government directly engaged in protecting the banking sector from property associated
risks. The past few years have been challenging for the Chinese market bringing valuations to
decadelows.
Prescient’s performance has remained consistent and strong among our funds and we continue
to build our brand and products on strong foundations.
With China remaining one of the cheapest markets in the world, we see rising interest from
clients who have previously not invested in China.
We are in China for the long term, although painful over the short term the bursting of the
property bubble will finally drive capital towards more productive sectors in the economy,
leading to growth in the asset management industry with properties no longer forming the core.
These trends should benefit our industry and the Prescient funds over the longer term.’
Reinet’s total investment is carried at an estimated fair value of € 124 million based on unaudited
financial information provided by Prescient at 31 March 2024 (31 March 2023: € 143 million).
The decrease in estimated fair value mainly reflects decreases in the value of the underlying fund
investments offset by the strengthening of the US dollar against the euro in the year.
Further information on Prescient is available at www.prescient.co.za
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Asia Partners funds
Reinet is invested in Asia Partners I LP and Asia Partners II LP.
Asia Partners I LP is the inaugural fund of Asia Partners Fund Management Pte. Ltd
(‘AsiaPartners’), a Singapore-based growth equity investment firm. Asia Partners II LP, a successor
fund, was launched in April 2022.
Asia Partners bases its investment strategy on the long-term growth potential of Southeast Asia,
the rapid growth of innovative technology and technology-enabled businesses in the region,
and target investments in the $ 20 million to $ 80 million range, often described as the ‘Series
C/DGap’ between early-stage venture capital and the public capital markets.
Oliver Rippel, Co-Founder and Partner of Asia Partners, commented:
‘Asia Partners has successfully completed the final closing of our second Fund, raising a total
of $ 474 million. This significant milestone brings our total assets under management to
$ 1.0 billion. Our investment focus remains on the promising long-term growth prospects
of Southeast Asia. The critical importance of this region given its growing affluence, the
accelerating shift towards digital lifestyles, alongside being home to almost 10 per cent of the
world’s population, in addition to growing economic ties in global trade and supply chain
dynamics, reinforces our commitment.
We believe in the potential for growth equity to accelerate economic growth throughout Southeast
Asia. We will continue to nurture the development of Southeast Asia’s emerging entrepreneurs,
ultimately helping them transition to become sizeable public companies.’
In April 2022, Reinet committed € 29 million ($ 31 million) to Asia Partners II LP as part of the
first close. This amount increased to € 44 million ($ 47 million) through March 2024.
The investment in Asia Partners funds is held at the estimated fair value of € 34 million
(31March2023: € 32 million) based on audited financial information provided by Asia Partners
at 31 December 2023 adjusted for cash movements up to 31 March 2024.
The increase in the estimated fair value reflects capital contributions of € 4 million, together with
the strengthening of the US dollar against the euro in the year, offset by decreases in the value of
underlying investments.
Further information on Asia Partners is available at www.asiapartners.com
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CONTINUED
SPECIALISED INVESTMENT FUNDS
NanoDimension funds and co-investment opportunities
ND Capital (‘NanoDimension’) is a venture capital firm founded in 2002 that invests in
disruptive technologies in and at the intersection of the life and physical sciences, accelerated
by data sciences. Their core belief is that scientific disciplines will continue to converge, and
that some of the biggest breakthroughs will occur at the intersection of two or more disciplines.
The focus of each fund is to invest in and support the establishment, technology development
and scale up, growth and commercialisation of portfolio companies. They believe that these
disruptive technologies address some of the biggest societal problems. Investments range from
molecular diagnostics, cell and gene therapies, organs on chip, DNA synthesis and DNA
editing, energy storage and electrical propulsion systems for aviation. They invest predominantly
across the United States and Europe with additional investments in Canada, Denmark and the
UnitedKingdom.
Aymeric Sallin, Founder of NanoDimension, commented:
‘2023 was one of the most important years for ND Capital, despite a challenging Venture Capital
(VC) market. Only 154 IPOs took place in 2023 versus an average of 750 in 2020/21, which
were fueled by the SPAC and a robust technology sector. Technology M&A were down 51 per cent
in value, year over year. VC distributions hit the lowest level of the last 14 years.
Three of our portfolio companies were sold to listed entities, for total proceeds of $ 1.6 billion.
NDCapital was the lead investor in one of the investments where the exit had a significant impact
and distributions for two of our funds, as well as our reputation.
Key portfolio companies managed to raise substantial additional capital of approximately
$455million from third parties on good terms, which should set them up for their next phase of
development.’
Reinet is a limited partner in NanoDimension II L.P., NanoDimension III L.P., NanoDimension
IV L.P. and ND Capital Opportunity Fund I L.P., and is invested in one co-investment
opportunity alongside NanoDimension II L.P.
At 31 March 2024, the estimated fair value of Reinet’s investment amounted to € 107 million
(31 March 2023: € 94 million) based on audited valuation data provided by NanoDimension
as at 31 December 2023 adjusted for movements in listed investments and cash movements up
to 31 March 2024.
The increase in the estimated fair value reflects capital contributions of € 13 million together
with increases in the value of underlying investments and the strengthening of the US dollar
against the euro in the year, offset by distributions of € 16 million.
Further information on NanoDimension is available at www.nd.capital
Other fund investments
This includes small, specialist funds investing in private equity businesses and start-up ventures.
Other fund investments are valued in total at their estimated fair value of € 1 million at
31March2024 (31 March 2023: € 2 million) based on the latest available valuation statements
received from the fund managers.
The decrease in the estimated fair value principally reflects decreases in the value of underlying
investments.
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UNITED STATES LAND DEVELOPMENT AND MORTGAGES
Reinet has invested in certain real estate development projects and related businesses located
in the United States (including Florida, North Carolina and South Carolina). Reinet has also
purchased mortgage debt associated with such developments from financial institutions, usually
at significant discounts to face value.
The core land development process encompasses land planning, attaining entitlements from
governmental bodies and installation of community infrastructure. Other investments in
mitigation banks facilitate the preservation of land to offset the loss of wetlands necessitated
by public improvements, such as highway construction, and other privately-sponsored
developments.
Bill Lanius, Chief Executive Officer of United States land development and mortgages, commented:
‘Our United States land development and mortgages business has been positioned to serve
the homebuilding industry which has shown resilience this past year. Escalation in home
prices combined with interest rates that remain high by the standards of recent decades have
dampened demand. At the same time, many homeowners are reluctant to forfeit low mortgage
rates that were previously obtained on their existing homes. This “lock-in effect” has suppressed
the inventory of existing housing stock but has helped support new home demand for which we
provide developed sites. While supply chain constraints have improved, challenges associated
with the regulatory environment have heightened.
During our most recent fiscal year, the United States land development and mortgages business
monetized target investment positions in transactions that were accretive to value and generated
liquidity to facilitate our future business plans.’
The investment is carried at the estimated fair value of € 21 million as at 31 March 2024
(31 March 2023: € 26 million). The current valuation is based on audited and unaudited
financial statements as at 31 December 2023 adjusted for cash movements up to 31 March 2024.
The decrease in the estimated fair value reflects repayments received during the year of € 7million,
offset by increases in the valuation of underlying assets together with the strengthening of the
USdollar against the euro during the year.
OTHER INVESTMENTS
Other investments are carried at their estimated fair value of € 75 million at 31 March 2024
(31March 2023: € 58 million).
The increase in the estimated fair value reflects capital contributions of € 22 million together
with increases in the valuation of underlying investments and the strengthening of sterling and
the US dollar against the euro in the year, offset by a capital distribution of € 5 million.
An investment was realised during the year resulting in a loss of € 26 million, this amount had
been fully provided for in prior years.
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BUSINESS OVERVIEW
CONTINUED
COMMITTED DURING THE YEAR
Commitments made in the year amounted to € 61 million and cancelled commitments in respect of fully exited funds amounted to € 5 million.
TOTAL COMMITMENTS
Funding commitments are entered into in various currencies including sterling and US dollar and are converted into euro using 31 March 2024
exchange rates.
The table below summarises Reinet’s investment commitments as at 31 March 2024.
31 March
2023
(1)
€ m
Exchange
rate
effects
(2)
€ m
Committed
during the
year
(3)
€ m
Funded
during the
year
(3)
€ m
31 March
2024
(3)
€ m
31 March
2024
%
Private equity and related partnerships
Trilantic Capital Partners
Funds and related general partners
(4)
120 1 (5) (23) 93 16.7
TruArc Partners
Funds, co-investment opportunities and
management company 148 1 19 (46) 122 21.8
Coatue funds 228 1 – (20) 209 37.4
Asian private equity companies and
portfolio funds
Asia Partners funds 32 – 9 (4) 37 6.6
Specialised investment funds
NanoDimension funds and
co-investment opportunities 60 – – (13) 47 8.4
Other fund investments 32 1 – – 33 5.9
United States land development and
mortgages 5 – – – 5 0.9
Other investments 2 – 33 (22) 13 2.3
627 4 56 (128) 559 100.0
(1) Commitments calculated using 31 March 2023 exchange rates.
(2) Reflects exchange rate movements between 31 March 2023 and 31 March 2024.
(3) Amounts calculated using 31 March 2024 exchange rates, which may differ from actual exchange rates on the transaction date.
(4) Commitments noted represent only Reinet’s share of the investments at 31 March 2024, additional commitments payable by the minority partner amount to € 2 million in respect of Trilantic.
The reduction in the commitment relates to remaining uncalled commitments in respect of a fund which was dissolved in the year.
REINET INVESTMENTS S.C.A.
23 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
CASH AND LIQUID FUNDS
Reinet holds cash on deposit principally in European-based banks
and in liquidity funds holding highly rated short-term instruments.
Reinet’s liquidity is measured by its ability to meet potential cash
requirements, including unfunded commitments on investments
and the repayment of borrowings, and at 31 March 2024 can be
summarised as follows:
Cash and liquid funds € 357 m
Undrawn borrowing facilities € 234 m
Cash required for unfunded commitments (refer
to table on previous page) (€ 559 m)
Cash required to meet GBP borrowing obligations (€ 234 m)
The undrawn borrowing facilities comprise a revolving facility with
Bank of America, N.A. and with Citibank N.A. (see below).
Reinet may sell further BAT shares or use such shares to secure
additional financing facilities from time to time.
BANK BORROWINGS
BORROWINGS
Reinet has a fixed-rate £ 100 million margin loan due to Citibank N.A.,
which is repayable in August 2024. At 31 March 2024, the estimated
fair value of the loan amounted to € 115 million (31 March2023:
€108 million).
In addition, Reinet has a fixed-rate £ 100 million margin loan due
to Bank of America, N.A., which is repayable in March 2025. At
31 March 2024, the estimated fair value of the loan amounted to
€114 million (31 March 2023: € 109 million).
The increase in the estimated fair value of both loans reflects the
strengthening of sterling in the year, together with the reduction in the
time remaining to maturity, offset by an increase in the discount rates
used (due to increases in market interest rates).
Some 15 million BAT shares have been pledged to collateralise these
two loans.
In addition, Reinet has a facility agreement in place with Citibank
N.A. up to August 2024 and with Bank of America, N.A. up to
March2025. Thesefacilities allow Reinet to drawdown the equivalent
of up to € 234 million (£ 200 million) in a combination of currencies
to fund further investment commitments. As at 31 March 2024 no
funds have been drawn under these facilities.
Refer to page 56 for a description of Reinet’s policy on foreign exchange
exposure.
OTHER LIABILITIES
Minority interest, fees payable and other liabilities, net of other assets
comprise:
31 March 2024
€ m
31 March 2023
€ m
Minority interest (4) (4)
Management fee (19) (19)
Performance fee (90) –
Tax provisions (4) (5)
Accruals and other payables,
net of other receivables (11) (8)
BAT dividend receivable 33 32
Total other liabilities (95) (4)
The minority interest liability is in respect of a minority partner’s
share in the gains and losses not yet distributed arising from the
estimated fair value movement of investments in which they have
interests.
Tax provisions relate to realised and unrealised gains arising from the
investments in Trilantic Capital Partners together with withholding
and corporate taxes relating to the investment in United States land
development and mortgages.
The BAT dividend receivable had a record date of 22 March 2024
and a payment date of 2 May 2024.
A provision of € 90 million has been made in respect of a performance
fee as at 31 March 2024 (31 March 2023: € nil) as the conditions
required to pay a fee had been met at the year end date. In order for
a performance fee to be payable at 31 March 2024, the volume
weighted average market price of the Company’s share determined
by taking into account volume and price information on the
Luxembourg Stock Exchange, Euronext Amsterdam and the
Johannesburg Stock Exchange over the last 20 trading days of the
financial year under review would need to exceed € 18.33. The
volume weighted average market price of the Company’s share was
€ 22.93 for the last 20 trading days of the financial year, and as such
a performance fee is payable.
The performance fee and management fee are payable to Reinet
Investment Advisors Limited.
24
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
BUSINESS OVERVIEW
CONTINUED
INCOME STATEMENT
The income statement set out below differs from the format used in the IFRS reporting on page 46 and is presented to provide investors with a
more comprehensive picture of the movement in the estimated fair value of assets held by Reinet.
Year ended
31 March 2024
Year ended
31 March 2023
€ m € m € m € m
Income
BAT dividends 130 122
Pension Corporation dividend 57 –
Interest and other investment income 31 23
Realised (loss)/gain on sale of investments (9) 13
Carried interest earned on investments 3 6
Total income 212 164
Expenses
Management fee (48) (49)
Performance fee (90) –
Operating expenses, foreign exchange and transaction-related costs (7) (6)
Interest and related financing expenses (6) (5)
Tax expense (1) (5)
Total expenses (152) (65)
Realised investment income, net of expenses 60 99
Fair value adjustments
BAT (202) (271)
Pension Corporation 649 (15)
Other investments 20 55
Derivative instruments – (1)
Borrowings (12) 11
Total fair value adjustments 455 (221)
515 (122)
Effect of exchange rate changes on cash balances 4 2
Net profit/(loss) 519 (120)
Minority interest – –
Profit/(loss) attributable to the shareholders of the Company 519 (120)
REINET INVESTMENTS S.C.A.
25 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
INCOME
Dividend income from BAT recorded during the year ended
31 March 2024 amounted to € 130 million (£ 112 million)
(31March 2023: € 122 million (£ 107 million)). Dividend income
received from BAT during the year represents the second, third and
fourth 2023 quarterly dividends paid and the first 2024 quarterly
dividend with a record date of 22 March 2024 and a payment date
of 2 May 2024.
Dividend income from Pension Corporation amounting to some
€ 57 million (£ 50 million) was received in May 2023, being an
inaugural dividend of 7.50 pence per ordinary share.
Interest income is earned on bank deposits, liquidity funds,
investments and loans made to underlying investments.
Realised losses on investments were in respect of investments held
in Milestone funds and other investments, offset by realised gains in
respect of investments held in Trilantic Capital Partners.
Carried interest of € 3 million (31 March 2023: € 6 million) was
attributable to Reinet in respect of investments realised by Trilantic
Capital Partners.
EXPENSES
The management fee for the year ended 31 March 2024 amounts to
€48 million and is based on Reinet Fund’s NAV of € 5 616million
at 30 September 2023 and € 5 721 million at 31 March 2023
(31 March 2023: € 49 million, based on Reinet Fund’s NAV
of €5441 million at 30 September 2022 and € 5 890 million at
31March 2022).
A performance fee of € 90 million is payable for the year ended
31 March 2024 (31 March 2023: € nil). The performance fee is
calculated as 10 per cent of the Cumulative Total Shareholder Return as
defined in the Company’s prospectus, published on 10 October2008
as last amended on 25 August 2020, including dividends paid, over
the period since completion of the rights issue in December 2008 up
to 31 March 2024, less the sum of all performance fees paid in respect
of previous periods.
Operating expenses of € 7 million include € 1 million in respect
of charges from Reinet Investments Manager S.A. (the ‘General
Partner’), and other expenses which amounted to € 6 million.
The net tax expense of € 1 million includes corporate and
withholding taxes payable in respect of gains realised on Trilantic
Capital Partners, together with deferred tax provisions related to
unrealised gains, expected distributions and accrued interest in
respect of Trilantic Capital Partners, TruArc Partners and United
States land development and mortgages.
FAIR VALUE ADJUSTMENTS
The investment in 48.3 million BAT shares decreased in value by
€202 million during the year under review. Of this, € 243 million was
attributable to the decrease in value of the underlying BAT shares in
sterling, offset by an increase of € 41 million due to thestrengthening
of sterling against the euro during the year underreview.
The investment in Pension Corporation increased in value by
€649million which includes an increase of some € 340 million in
respect of the increase in market multiples, together with an increase
of some € 210 million due to the movement on Pension Corporation’s
adjusted equity own funds value and some € 100million due to the
strengthening of sterling against the euro in the year under review
(refer to pages 11 and 12 for more detail).
The unrealised fair value adjustment of € 20 million in respect of
other investments includes an increase in the estimated fair value
of TruArc Partners, other listed investments and NanoDimension,
offset by decreases in the fair value of Prescient China funds and
Milestone (see detailed analysis on page 52). The above amounts
include the effect of changes in foreign exchange rates in the year
under review.
Borrowings are carried at estimated fair value reflecting the
discounted cash flow value of future principal and interest payments
taking into account prevailing interest rates. Unrealised losses
of €12million during the year were in respect of changes in the
estimated fair value of the Citibank N.A. and Bank of America,
N.A. loans.
MINORITY INTEREST
The minority interest expense arises in respect of the minority
partner’s share in the earnings of Reinet TCP Holdings Limited.
26
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
BUSINESS OVERVIEW
CONTINUED
CASH FLOW STATEMENT
The summarised cash flow statement set out below differs from the format used in the IFRS reporting on page 48 and is presented to provide
investors with a more comprehensive picture of the movement in cash and liquid funds.
Year ended
31 March 2024
Year ended
31 March 2023
€ m € m € m € m
Investing activities
Purchase of investments, net of repayments (116) (167)
Proceeds from sales of investments 84 76
Net cash and liquid funds used in investing activities (32) (91)
Financing activities
Dividend paid (55) (51)
Cost of share buyback programmes – (45)
Net cash and liquid funds used in financing activities (55) (96)
Operating activities
Dividends received 186 122
Carried interest earned on investments 3 6
Interest and related financing expenses (6) (5)
Interest income 16 6
Operating and related expenses (46) (58)
Taxation paid (1) (13)
Net cash and liquid funds generated by operating activities 152 58
Net cash inflow/(outflow) 65 (129)
Opening cash and liquid funds position 288 415
Effects of exchange rate changes on cash balances 4 2
Closing cash and liquid funds position
(1)
357 288
(1) Includes cash and liquid funds held in the Company, Reinet Fund and its subsidiaries.
INVESTING ACTIVITIES
Investments totalling € 116 million were made during the year,
including Trilantic Capital Partners, TruArc Partners, Coatue funds,
Asia Partners funds, NanoDimension funds, and other investments.
Amounts invested were partially offset by repayments in respect of
loans received from United States land development and mortgages
and other investments.
Proceeds from the sale of investments were in respect of Trilantic
Capital Partners, TruArc Partners, Milestone China Opportunities
funds and NanoDimension funds.
FINANCING ACTIVITIES
A dividend of some € 54.5 million was paid to shareholders in
September 2023.
OPERATING ACTIVITIES
Dividends received from BAT during the year ended 31 March2024
amounted to € 129 million (£ 112 million) (31 March 2023:
€122million (£ 105 million)). The dividends received from BAT
during the year represent the first, second, third and fourth 2023
quarterly dividends paid.
A dividend received from Pension Corporation during the year
amounted to € 57 million (£ 50 million).
Interest of € 6 million was paid in respect of the sterling-denominated
loans.
Interest income relates to cash on deposit in banks and liquidity
funds.
Net US tax payments of € 1 million were paid in the year under
review. This amount includes taxes withheld by US paying agents in
respect of gains and carried interest received, together with estimated
taxes paid on gains and income which will be taxable in the US.
Cash and liquid funds increased by € 69 million over the year to
€ 357 million as the amounts received in respect of dividends and
distributions from investments exceeded amounts paid in respect
of investments, dividends, management fee and operating expenses.
REINET INVESTMENTS S.C.A.
27 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
RISKS AND UNCERTAINTIES
Reinet’s current investments and future investment strategy are
subject to a number of risks and uncertainties. The General Partner
and Fund Manager have established policies and procedures to
identify and monitor these risks.
Responsibility for investment risk and treasury risk is borne by the
Board of the Fund Manager. The day-to-day treasury position is
monitored by the Chief Executive Officer and the Chief Financial
Officer and policy decisions in respect of the investment of cash
resources are taken by the Board of the Fund Manager.
Investment decisions are the responsibility of the Fund Manager,
acting on the advice of the Investment Advisor, as appropriate.
Reinet’s activities expose it to a variety of financial risks including
market risk (ie currency risk, fair value interest rate risk, cash flow
interest rate risk and price risk), credit risk and liquidity risk; these
risks are detailed in note 5 to the consolidated financial statements
on page 53 of this report.
During the year, global markets continued to be impacted by the
effects of the Ukraine crisis, the turmoil in the Middle East, high
interest rates and inflation. Whilst inflation has started to fall,
high prices continue to put significant pressure on households
and consumers as many central banks hold interest rates at current
levels to mitigate the inflation concerns. The extent and impact
of these factors remain uncertain. As a result, higher levels of risk
and uncertainty exist at this time and markets are likely to remain
volatile for some time, and thereby continue to have an influence
on the value and prospects of the investments held by Reinet Fund.
Other principal risks are as follows:
LEGAL AND COMPLIANCE RISKS
Laws and regulations governing the operations of the Company
and Reinet Fund may affect their business, investments and results
ofoperations.
The Company is required to comply with certain regulatory
requirements applicable to a Luxembourg securitisation company,
and Reinet Fund is required to comply with certain regulatory
requirements that are applicable to a Luxembourg specialised
investment fund. The Company is also required to comply with
regulations applicable to a company admitted to listing and trading
on the Luxembourg Stock Exchange and Euronext Amsterdam, and
with a secondary listing on the Johannesburg Stock Exchange.
Additional laws and regulations may apply to the portfolio assets in
which Reinet makes investments, and those laws and regulations, as
well as those applicable to Reinet, may restrict the ability of Reinet
to make certain types of investments in certain countries or affect
the returns available from those investments.
Laws and regulations and their interpretation and application may
also change from time to time and such laws and regulations or
those changes could have a material adverse effect on the business,
investments and results of operations of Reinet. In addition, a
failure to comply with applicable laws or regulations, as interpreted
and applied, or to maintain any necessary regulatory licences, by
any of the General Partner, Fund Manager or Investment Advisor,
could have a material adverse effect on the business, investments
and results of operations of Reinet. Where investee companies are
subject to regulation, failure to obtain appropriate licences or to
comply with regulatory requirements may impact the valuation of
the underlying investment.
Additional laws and regulations may apply to shareholders’
ownership of the Company’s shares, including as a result of Reinet
Fund’s direct and indirect investments.
The United States’ Foreign Account Tax Compliance Act (‘FATCA’)
imposes reporting and other requirements on payers and recipients
of certain categories of income starting 1 July 2014. Non-US entities
which do not comply with FATCA may be subject to withholding
tax on certain categories of income. The Company and its controlled
affiliates have taken the steps they considered necessary to be and
remain compliant with FATCA.
Under FATCA, the Company or its affiliates may be required to
report to the US Internal Revenue Service (‘IRS’), directly or
through their respective tax authority co-operating with the IRS,
information about financial transactions made by US taxpayers
and other specified entities or individuals, and could be required to
impose withholding tax, documentation and reporting requirements
on such transactions. The additional administrative requirements of
FATCA may result in increased compliance costs and could have an
adverse effect on the business, investments and results of operations
of Reinet.
The Common Reporting Standard (‘CRS’), developed by the
Organisation for Economic Co-operation and Development, is a
global standard for the automatic exchange of financial information
between tax authorities worldwide. Under the CRS, the Company
and/or its affiliates may be required to identify and report to their
respective tax authority information on certain accounts held directly
or indirectly by tax residents in other participating CRS countries,
which may subsequently be disclosed to foreign tax authorities. The
Company and its affiliates have taken the steps they considered
necessary to be and remain compliant with the obligations imposed
by the CRS. The additional administrative requirements of the CRS
may result in increased compliance costs for Reinet.
The Company must comply with the X Principles of the
Luxembourg stock exchange, which in their fifth version require the
implementation of an appropriate sustainability policy, which shall
set out measures taken for its implementation as well as transparent
and detailed reporting. As per principle 9, it is recommended for
reporting purposes to prepare and publish the material sustainability
performance indicators relating to the Company’s business activities,
which shall include ambitious targets and environmental, social and
governance commitments. This, together with the implementation
of the European Union (‘EU’) corporate and social responsibility
directive implemented in Luxembourg laws and its concept of
double materiality assessment, are also likely to result in an increase
in compliance costs for Reinet.
28
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
BUSINESS OVERVIEW
CONTINUED
OPERATIONAL RISKS
The Company does not have any operations of its own. Alloperations
are carried out by Reinet Fund.
The Company’s principal source of earnings is returns in the form
of income and capital gains from the investments made through
ReinetFund and its subsidiaries.
The ability of Reinet Fund to make cash distributions to the
Company will depend on a number of factors, including, among
others, the actual results of operations and financial condition of
Reinet Fund, its subsidiaries and investee companies, restrictions
on cash distributions that are imposed by applicable law or the
constitutional documents of Reinet Fund, the terms of any future
financing agreements entered into by Reinet Fund or its subsidiaries,
the timing and amount of cash generated by investments that are
made by Reinet Fund, any contingent liabilities to which Reinet
Fund may be subject, the amount of income generated by Reinet
Fund and other factors that the Fund Manager deems relevant.
DIVIDEND
The Company relies on distributions from Reinet Fund as its
principal source of income from which it may pay dividends.
A cash dividend of some € 54.5 million or € 0.30 per share (excluding
treasury shares held) was paid in September 2023, following approval
at the annual general meeting held on 29 August 2023.
The General Partner has proposed a cash dividend of € 0.35 per
share subject to shareholder approval at the annual general meeting,
which is scheduled to take place in Luxembourg on Tuesday,
27August 2024.
There is no Luxembourg withholding tax payable on dividends
which may be declared by the Company.
In 2013 the Company sought clarification from the South African
Revenue Service (‘SARS’) as to the treatment of any dividends to
be declared by the Company and paid to holders of depository
receipts issued by Reinet Securities SA in respect of the Company’s
ordinary shares. This ruling was renewed for a further five years on
8March2018 and again on 17 October 2023 in respect of any
dividends to be declared by the Company and paid to holders of
the Company’s ordinary shares listed on the Johannesburg Stock
Exchange.
The dividend will be payable in accordance with the following
schedule, subject to shareholder approval:
The last day to trade the Company’s shares cum-dividend in Europe
will be Wednesday, 11 September 2024 and in South Africa,
Tuesday, 10 September 2024. The Company’s shares will trade
ex-dividend from Thursday, 12 September 2024 in Europe and from
Wednesday, 11 September 2024 in South Africa. The record date for
the Company’s shares in Europe and in South Africa will be Friday,
13 September 2024.
The dividend on the Company’s shares in Europe will be paid on
Wednesday, 18 September 2024 and is payable in euro.
The dividend on the Company’s shares in South Africa will be paid
in South African rand on Wednesday, 18 September 2024. Further
details regarding the dividend payable to South African holders may
be found in a separate announcement dated 28 May 2024 on the
Johannesburg Stock Exchange News Service.
REINET INVESTMENTS S.C.A.
29 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
CORPORATE GOVERNANCE
INTRODUCTION
The Company recognises the importance of appropriate corporate
governance procedures in the management and oversight of its
business. The Company acknowledges the obligations placed upon
it as a public company with a listing on the Luxembourg Stock
Exchange and Euronext Amsterdam and a secondary listing on the
Johannesburg Stock Exchange. Notably, the Company is subject to
the fifth version of the X Principles of Corporate Governance of
the Luxembourg Stock Exchange (the ‘X Principles’) in so far as
applicable to the Company.
The Company’s corporate governance principles are described
in the Company Prospectus, in the statutes of the Company (the
‘Statutes’), as well as in the Corporate Governance Charter adopted
by the Company, all of which are available on the Company website,
www.reinet.com. The requirements of the Statutes, the principles set
out in the Company Prospectus and the Corporate Governance
Charter (together with the policies and procedures described
therein) adequately establish the framework of corporate governance
within which Reinet operates.
The Company, a partnership limited by shares (société en commandite
par actions) under the laws of Luxembourg, gives its shareholders
exposure to Reinet Fund, a specialised investment fund.
The Company was formerly known as Richemont S.A., which was
a subsidiary of Compagnie Financière Richemont SA (‘CFR SA’),
a Swiss company with significant luxury goods interests (CFR SA,
together with its subsidiaries are referred to as ‘Richemont’). The
Company separated from its former parent on 20 October 2008,
which saw the luxury businesses transferred to CFR SA. Following
the separation and subsequent restructuring steps, the Company
effectively retained part of Richemont’s former interests in BAT
together with cash and certain smaller investments.
MANAGEMENT
As a partnership limited by shares, the Company is managed by a
general partner rather than a board of directors. The general partner
is Reinet Investments Manager S.A. (the ‘General Partner’), a limited
company established in Luxembourg (société anonyme), which also
owns 1 000 management shares in the Company and which has
unlimited liability for any obligations of the Company that cannot
be met from the assets of the Company.
Both the General Partner and Reinet Fund Manager S.A. (the ‘Fund
Manager’) are owned and controlled by Rupert family interests.
During the year ended 31 March 2024, the board of directors of the
General Partner (the ‘Board of Directors’) met on four occasions.
All directors attended all meetings. The statutes of the General
Partner require that the Board of Directors consists of a minimum
of three directors.
The General Partner is not acting as general partner for any
partnership other than the Company.
BOARD OF DIRECTORS OF THE GENERAL
PARTNER
The directors of the General Partner are:
JOHANN RUPERT
Chairman
South African, born 1950
Mr Rupert was appointed to the Board of Directors in 2008.
Mr Rupert studied economics and company law at the University of
Stellenbosch, South Africa. After working for the Chase Manhattan
Bank and Lazard Frères in New York, he founded Rand Merchant
Bank in 1979. In 1985 he joined Rembrandt. He founded
Richemont in 1988 and became Group Chief Executive. Appointed
as Executive Chairman in September 2002, he also served as Group
Chief Executive Officer during the periods from October 2003
to September 2004 and from April 2010 to March 2013. He was
Chairman of CFR SA up to September 2013, when he indicated
his intention to step down from the board of that company during
a sabbatical year. He was re-elected as Chairman of CFR SA in
September 2014. He is also Non-Executive Chairman of Remgro
Limited and is the Managing Partner of Compagnie Financière
Rupert.
Mr Rupert holds honorary doctorates in Law, Economics and
Commerce, is Chairman of the Peace Parks Foundation and the
Michelangelo Foundation.
WILHELM VAN ZYL
Chief Executive Officer
British & South African, born 1965
Mr van Zyl was appointed to the Board of Directors in 2014 and
appointed Chief Executive Officer with effect from January 2015.
Mr van Zyl holds a BCom degree from the University of Stellenbosch
and qualified as a Fellow member of the Institute and Faculty of
Actuaries (United Kingdom) in 1994. He is also a Fellow member
of the Actuarial Society of South Africa and completed the Harvard
AMP program in 2005. Mr van Zyl was group actuary of the financial
services group Metropolitan Holdings from 2001 and headed up
its corporate business from 2006. In 2008 he was appointed as a
director and chief executive of Metropolitan Holdings.
Following the listing of MMI Holdings (renamed Momentum
Metropolitan Holdings) in 2010, resulting from the merger between
Metropolitan and Momentum, he was appointed as a director and
deputy group chief executive with oversight of the group’s health,
international, investments and employee benefit operations. He
currently also serves on the boards of Pension Insurance Corporation
plc, Pension Insurance Corporation Group Limited, Prescient
Investment Management China Limited and is also a director of
the Investment Advisor and of various subsidiaries of Reinet Fund.
30
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
ALAN GRIEVE
Non-Executive Director
British & Swiss, born 1952
Mr Grieve was appointed to the Board of Directors in 2008.
Heretired as Chief Executive Officer in December 2014.
Mr Grieve served as Chief Financial Officer from 2008 to 2011 and
as Chief Executive Officer from 2012 to 2014. He remains on the
Board of Directors as a Non-Executive Director of both the General
Partner and Fund Manager.
Mr Grieve was appointed to the board of directors of Richemont
S.A. (the predecessor company to Reinet Investments S.C.A.) in
2004. Mr Grieve holds a degree in business administration from
Heriot-Watt University, Edinburgh and is a member of the Institute
of Chartered Accountants of Scotland. Prior to joining Richemont’s
predecessor companies in 1986, he worked with the international
auditing firms now known as PricewaterhouseCoopers and Ernst
& Young. He served as Richemont’s Company Secretary from 1988
to 2004 and as Director of Corporate Affairs from 2004 to 2016.
JOSUA MALHERBE
Non-Executive Director
British & South African, born 1955
Mr Malherbe was appointed to the Board of Directors in 2009.
Mr Malherbe qualified as a chartered accountant in South Africa
in 1984 having commenced his career with a predecessor firm to
PricewaterhouseCoopers. He then joined the Corporate Finance
Department of Rand Merchant Bank in 1985 and was a general
manager of the bank before moving to Rembrandt Group Limited
in 1990, also being involved with Richemont at that time.
He was appointed as Director – Investments of Rembrandt in 1993
and served in this position until the formation of VenFin Limited
in 2000 where he served as Chief Executive Officer until 2006.
Thereafter he held the position of Deputy Chairman of VenFin
Limited until November 2009 at which time Remgro Limited
acquired all the shares in VenFin Limited.
He was appointed as a Non-Executive Director to the board of CFR
SA in September 2010 and assumed the role of Deputy Chairman in
September 2013. He also serves as a director on boards of a number
of companies, including Remgro Limited and Pension Insurance
Corporation Group Limited.
REINET FUND
The Company owns the entire ordinary share capital of Reinet
Fund, a specialised investment fund established as a partnership
limited by shares (société en commandite par actions) under the laws
of Luxembourg.
As a partnership limited by shares, Reinet Fund is managed by a
general partner rather than a board of directors. The general partner
is the Fund Manager, a limited company established in Luxembourg
(société anonyme), which also owns 1 000 management shares in
Reinet Fund and which has unlimited liability for any obligations
of Reinet Fund that cannot be met from the assets of Reinet Fund.
BOARD OF DIRECTORS OF THE FUND
MANAGER
The directors of the Fund Manager are:
JOHANN RUPERT
Chairman
(For biographical details see page 29)
WILHELM VAN ZYL
Chief Executive Officer
(For biographical details see page 29)
ALAN GRIEVE
Non-Executive Director
(For biographical details see above)
SWEN GRUNDMANN
Non-Executive Director
Dutch, born 1968
Mr Grundmann was appointed to the Board of Directors in
September 2012.
Mr Grundmann holds a law degree from the Faculty of Law of the
University of Amsterdam. He joined Richemont in January 1996
and is its Company Secretary and Director of Corporate Affairs.
He held the position of Company Secretary of both the General
Partner and Fund Manager from 2009 to January 2023. He has
been Reinet’s General Counsel and responsible for its legal affairs
from 2011 to January 2023 and serves on the boards of a number of
companies in which Richemont or Reinet hold an interest.
He is a member of the Dutch Association of Corporate Litigation.
DIANE LONGDEN
Chief Financial Officer
British & Luxembourger, born 1961
Ms Longden was appointed to the Board of Directors in
September2012.
Ms Longden is a Fellow of the Institute of Chartered Accountants
in England and Wales and holds a Masters in Business
Administration from the Sacred Heart University, John F. Welch
College of Business in Luxembourg. Prior to joining Reinet in
2009, Ms Longden worked in the accountancy profession and
international insurance industry. She is also a director of various
subsidiaries of ReinetFund.
BOARD COMMITTEES AND MANAGEMENT
The Company is managed by a general partner and as such it has
no board of directors, executive management or employees. As a
consequence, aspects of corporate governance which relate, amongst
others, to the composition, organisation and proceedings of the board
of directors and executive management, the establishment of board
committees and related processes of a public company established in
Luxembourg are not directly applicable to theCompany.
CORPORATE GOVERNANCE
CONTINUED
REINET INVESTMENTS S.C.A.
31 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
BOARD OF OVERSEERS
In accordance with Luxembourg law, a board of overseers (Collège
des Commissaires) has been appointed to review the activities of the
Company (the ‘Board of Overseers’). The Board of Overseers’ role
is one of oversight and control in addition to the specific powers
conferred upon the Board of Overseers by virtue of the Statutes.
It has no executive responsibility for the management of the
Company except that the Board of Overseers may be consulted by
the General Partner on such matters as the General Partner may
determine and no action of the General Partner that may exceed its
powers shall be valid unless authorised by the Board of Overseers.
The Board of Overseers of the Company has also been appointed as
the Board of Overseers of Reinet Fund. Each of the members of the
Board of Overseers is independent from the General Partner and the
Fund Manager.
The members of the Board of Overseers may not be directors or
employees of the General Partner or of the principal shareholder
of the General Partner or any entity in which the Company has a
material direct or indirect interest.
The Board of Overseers reports each year to the annual general
meeting of shareholders on the results of the mandate entrusted to
it, making such recommendations as it considers appropriate.
Every second year the Board of Overseers conducts a self-assessment of
its role, accountability, composition and effectiveness. A self-assessment
was performed in respect of the year ended 31 March 2024.
In addition to its role as defined by law, the Board of Overseers also
acts as the audit committee of the Company and Reinet Fund.
The functions of the Board of Overseers include notably:
• Monitoring the financial reporting process;
• Reviewing the financial statements and the sustainability report
of the Company and Reinet Fund in order to ensure that they
are fair, accurate and complete;
• Monitoring the Company’s and Reinet Fund’s compliance with
applicable legal and regulatory obligations;
• Monitoring the statutory audit of the Company and Reinet
Fund;
• Reviewing and monitoring the independence of the approved
statutory auditor and approving permissible non-audit services
as required;
• Monitoring the effectiveness of internal control, risk
management procedures and sustainability information; and
• Assessing the quality of the internal audit of the Company and
Reinet Fund.
During the year under review, the Board of Overseers met physically
on three occasions and in addition four meetings were held by
conference calls. All the members attended all of the conference
calls. Subsequent to the year-end, the Board of Overseers also met
on 24 April 2024 and on 14 May 2024 to review and discuss with
the approved statutory auditor the statutory and consolidated
financial statements of the Company and recommended that these
be presented to the annual general meeting of shareholders of the
Company for approval.
Mr John Li is the chairman of the Board of Overseers.
The members of the Board of Overseers are:
JOHN LI
Chairman
Mauritian & Luxembourger, born 1960
Mr Li was appointed to the Board of Overseers in August 2015.
Mr Li is a non-executive director and a partner of The Directors’
Office, a company of independent and non-executive directors.
Previously he was a managing partner of KPMG Luxembourg
and a member of the KPMG global investment management
leadership team, as well as chairman of the supervisory board for
KPMG Luxembourg. Mr Li is a Fellow of the Institute of Chartered
Accountants in England and Wales and a former member of the
Board of the Institut Luxembourgeois des Administrateurs (Institute
of Directors in Luxembourg) for 12 years. His expertise lies in
investment funds, banking and wealth management.
YVES PRUSSEN
Luxembourger, born 1947
Mr Prussen was appointed to the Board of Overseers in
September2009.
Mr Prussen graduated as a doctor at law in 1971 and holds a diploma
from the ‘Institut d’Etudes Politiques’ of the University of Grenoble.
During the same year he became a member of the Luxembourg
Bar and since 1975 has been a partner in Elvinger Hoss Prussen, a
Luxembourg legal firm. Mr Prussen is a member of the International
Bar Association, the Luxembourg Section of the International Fiscal
Association and the Luxembourg Association for Arbitration. He is
the author of various publications in the field of tax law, arbitration,
securities laws and the law relating to undertakings for collective
investments.
STUART ROBERTSON
British & Swiss, born 1955
Mr Robertson was appointed to the Board of Overseers in
October2018.
Mr Robertson is a member of the Institute of Chartered
Accountants of Scotland and EXPERTsuisse. He has over 30 years
of experience with KPMG auditing financial institutions and also
advising them in areas of risk and regulation, transformation, and
M&A. He served on both the Executive Committee and the Board
of Directors of KPMG Switzerland for 12 years. He also served
as the KPMG Global Financial Services Deal Advisory leader for
11years. Heretired from KPMG at the end of September 2018 and
was voted on to the board of EFG International AG effective from
1October 2018.
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
CORPORATE GOVERNANCE
CONTINUED
STUART ROWLANDS
British & Luxembourger, born 1952
Mr Rowlands was appointed to the Board of Overseers in
August2016.
Mr Rowlands was the Head of Financial Risk at the European
Investment Bank (‘EIB’), the development bank of the EU, based in
Luxembourg, until his retirement on 30June2018. He joined the EIB
in 1988 and worked in various senior roles involving internal audit,
credit risk, infrastructure funding and project finance. Previously,
Mr Rowlands was with PricewaterhouseCoopers Luxembourg
and during this time spent two years with the European Court of
Auditors, also based in Luxembourg. Mr Rowlands is a Fellow of
the Institute of Chartered Accountants in England and Wales and
a member of the Institute of Internal Auditors and an INSEAD
– certified independent director. His expertise lies in financial and
credit risk management, internal audit and corporate governance.
APPOINTMENT OF THE MEMBERS OF THE
BOARD OF OVERSEERS
The Statutes provide for a Board of Overseers composed of at
least three members. The members of the Board of Overseers
are appointed by a resolution of the annual general meeting of
shareholders by a simple majority of the votes cast. The annual
general meeting of shareholders fixes the term of their office. They
may be re-elected. Their appointment is not subject to the approval
of the General Partner.
REMUNERATION
Neither the Company nor Reinet Fund has any employees. Rather,
both entities pay fees to their respective managers, the General
Partner and the Fund Manager, in respect of the management
services provided.
The Company is managed by its General Partner. In accordance with
the Statutes, the Company reimburses the General Partner for its
expenses incurred in the ordinary course of business, including but
not limited to the remuneration of its staff, costs attributable to its
directors’ remuneration, taxes, rentals and any other disbursements,
and pays an annual administration fee equal to 10 per cent of such
expenses. During the year ended 31 March 2024, the Company
paid € 1.5 million to the General Partner in respect of the costs
that it had incurred, out of which € 0.3 million related to the costs
attributable to its directors’ remuneration, and € 0.1 million to the
related administration fee.
The Company’s wholly-owned subsidiary, Reinet Fund, is managed
by the Fund Manager. Reinet Fund reimburses the Fund Manager
for its expenses incurred in the ordinary course of business
including but not limited to the remuneration of its staff, costs
attributable to its directors’ remuneration, taxes, rentals and any
other disbursements, and pays an annual administration fee equal
to 10per cent of such expenses. Any such amounts payable to the
Fund Manager are deductible from any management fees payable to
the Investment Advisor (see Significant Agreements).
The annual general meeting of shareholders sets the remuneration
of the members of the Board of Overseers. An annual compensation
of € 70 000 per annum for each of the members of the Board
of Overseers was approved at the annual general meeting of
shareholders held on 29 August 2023.
SHAREHOLDINGS AND LOANS
Details of shareholdings by members of the Board of Directors of
the General Partner are given in note 13 to the consolidated financial
statements on page 69 of this report.
As noted previously, the General Partner holds 1 000 management
shares in the Company.
The Company has procedures in place requiring persons connected
with the Company, Reinet Fund, the General Partner, the Fund
Manager and the Investment Advisor not to trade in the Company’s
securities during closed periods in advance of the release of financial
information in respect of the Company or at other times when
they may be in possession of price-sensitive information. Approval
of transactions involving the Company’s securities is required
from Mr Rupert, Mr Malherbe or Mr van Zyl and transactions by
persons discharging managerial responsibilities are disclosed on the
Company’s website and information relating to such transactions is
published in a manner that ensures the effective dissemination of
information to the public.
There were no loans outstanding to members of the Board ofDirectors
of the General Partner during the year or at 31March2024.
At 31 March 2024, the Company owed € 1.1 million to the General
Partner and Reinet Fund owed € 9.0 million to the Fund Manager.
SIGNIFICANT AGREEMENTS
The Company is managed by its General Partner. The Company
reimburses the General Partner for its expenses incurred in
the ordinary course of business, including but not limited to
the remuneration of its staff, costs attributable to its directors’
remuneration, taxes, rentals and any other disbursements, and pays
an annual administration fee equal to 10 per cent of such expenses
(see Remuneration).
The Company’s wholly-owned subsidiary, Reinet Fund, is managed
by the Fund Manager. Reinet Fund reimburses the Fund Manager
for its expenses incurred in the ordinary course of business including
but not limited to the remuneration of its staff, costs attributable to its
directors’ remuneration, taxes, rentals and any other disbursements,
and pays an annual administration fee equal to 10 per cent of such
expenses (see Remuneration).
Under the terms of the Investment Advisory Agreement dated
9October 2008, as amended on 24 May 2010, 10 November 2011,
7 December 2018 and 1 October 2020 between Reinet Fund and
the Investment Advisor, Reinet Fund pays both management fees
and performance fees to the Investment Advisor.
REINET INVESTMENTS S.C.A.
33 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
Mr van Zyl, who is a Director of the General Partner, is also a
member of the Board of Directors of the Investment Advisor.
The management fee is payable to the Investment Advisor at a rate
of 1 per cent per annum on the NAV of Reinet Fund, excluding
cash and interests in funds managed by third parties. It is calculated
semi-annually based on the closing NAV at the end of the previous
six-month period.
The management fee in respect of cash is calculated at a rate of one
quarter of 1 per cent per annum.
No management fee is payable in respect of funds managed by third
parties except where the fee payable to the third-party has been
negotiated to a level below 1 per cent per annum and below the
level payable by other investors in a fund. In such circumstances, the
difference between the fee payable to the third-party manager and
1per cent is payable to the Investment Advisor.
Investments as a limited partner in funds under the management of
a management company in which Reinet Fund is an investor are not
treated as being managed by third parties; the management fee is
payable at 1 per cent per annum to the Investment Advisor. However,
such a fee payable to the Investment Advisor is reduced by any
management fee paid by Reinet Fund to the management company,
net of income received by Reinet Fund on its investment in the
management company in terms of its share of the management fees
earned by (but not carried interest attributable to) the management
company.
The management fee for the year under review amounted to
€48million, of which € 11 million is paid to the Fund Manager.
As detailed in the Company Prospectus, issued when the Company
was established in 2008 as part of the Richemont reorganisation
which was approved by the former Richemont unitholders, the
performance fee in any period is to be calculated as 10 per cent of the
Cumulative Total Shareholder Return at the end of the Performance
Measurement Period, adjusted for all dividends and returns of capital
to the Company’s shareholders, less the sum of all performance fees
paid in previous Performance Measurement Periods. Following a
recent revision, the Cumulative Total Shareholder Return will be the
difference between the volume weighted average market price of the
Company’s shares on the Luxembourg Stock Exchange, Euronext
Amsterdam and the Johannesburg Stock Exchange over the last
20trading days of each financial year of the Company less the Initial
Price, calculated as the volume weighted average market price of
the Company’s shares on the Luxembourg Stock Exchange over the
first 60 trading days following the third day after the conclusion
of the rights issue in December 2008. The Initial Price, calculated
over the trading period from 22 December 2008 to 19 March 2009,
is€7.1945.
A performance fee of € 90 million is payable as of 31 March 2024
(31 March 2023: € nil).
The Investment Advisor shall be entitled to all accrued but unpaid
management fees and performance fees should the Fund Manager
(acting on the instructions of the Board of Overseers) terminate
the Investment Advisory Agreement with notice. Such entitlement
will not arise where the Fund Manager (acting on the instructions
of the Board of Overseers) is entitled to, and does, terminate the
Investment Advisory Agreement immediately or if the Investment
Advisory Agreement terminates automatically.
CONFLICTS OF INTEREST
Individuals who are involved in the management of the Company,
the General Partner or the Fund Manager may also be involved in
the management of other industrial and investment companies,
including but not limited to CFR SA and Remgro Limited.
There is a possibility that these individuals may have a conflict of
interest between the duties they owe to the Company or Reinet
Fund and the duties they owe to the other entities relying upon
their expertise. Such a conflict may arise in relation to, in particular,
proposed investment opportunities. The Company and Reinet
Fund will be managed to avoid any such conflicts of interest in all
possible circumstances, as is also formalised in a conflicts of interest
policy which was adopted by the Boards of the General Partner and
Fund Manager. If a conflict of interest in relation to an investment
opportunity would arise between any entities affiliated with Rupert
family interests the opportunity to co-invest may be offered to the
appropriate entities (taking into consideration, among other things,
the investment objective, policies and restrictions of each of those
entities). Specifically, in terms of the Company Prospectus and the
conflicts of interest policy it is expected that any investments in
luxury goods businesses will be made by CFR SA.
CAPITAL STRUCTURE
At 31 March 2024, the Company had 195 941 286 ordinary shares
and 1 000 management shares of no-par value in issue.
At 31 March 2024, the Company held 14 151 395 ordinary shares
as treasury shares. The voting and dividend rights attached to
treasury shares are suspended. Therefore, the total number of voting
rights at 31 March 2024 was 181 790 891.
SIGNIFICANT SHAREHOLDERS
The General Partner holds 1 000 management shares in the
Company, being 100 per cent of the management shares in issue.
The Anton Rupert Trust, the Anton Rupert Descendants Trust and
affiliated parties hold some 48.8 million ordinary shares representing
24.93 per cent of the Company’s issued share capital.
The group of parties regarded as being affiliated to the Anton
Rupert Trust and the Anton Rupert Descendants Trust includes
entities and persons which are not necessarily closely connected
with persons discharging managerial responsibilities within the
Company, as defined in Article 3 paragraph 1 of the EU Regulation
No 596/2014 on Market Abuse (the ‘Market Abuse Regulation’).
As a consequence, share dealings by such entities or persons are not
disclosed as dealings by connected parties in terms of the Market
Abuse Regulation.
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
CORPORATE GOVERNANCE
CONTINUED
On 20 September 2022, M&G Plc notified the Company that
accounts under management of M&G Investments Southern
Africa (Pty) Limited (previously Prudential Investment Managers)
held 5.01 per cent of the shares and voting rights in the Company
increasing above the 5 per cent threshold and an increase from
3.8per cent previously reported.
On 24 December 2021, the Public Investment Corporation notified
the Company that it held 15.02 per cent of the shares and voting
rights in the Company.
On 28 June 2021, Allan Gray Proprietary Limited notified the
Company that accounts under its management held 4.97 per cent
of the shares and voting rights in the Company, falling below the
5per cent threshold.
On 27 April 2020, GIC Private Limited notified the Company that
on 22 April 2020 its holding of the shares and voting rights in the
Company fell below the 3 per cent threshold, to 2.97 per cent.
Old Mutual Investment Group (Pty) Ltd informed the Company
that as from 27 April 2016 its holding on behalf of its clients
exceeded 3 per cent of the shares and voting rights in the Company.
As at the date of this report, the Company has not received any other
notifications of significant shareholdings in excess of 3percent of
the shares in issue.
SHAREHOLDERS’ MEETINGS AND VOTING
RIGHTS
Shareholders’ meetings may be convened by the General Partner or
by the Board of Overseers. All shareholders are invited to attend and
speak at all general meetings of shareholders. Any shareholder may
appoint another person, who need not be a shareholder, to represent
them at the meeting.
Other than as required by law, resolutions to be approved at a meeting
of shareholders will be passed by an absolute majority of those present
and voting. There is no quorum requirement for a meeting convened
to consider the business ordinarily to be considered by a shareholders’
meeting. The business ordinarily to be considered at a shareholders’
meeting is the approval of the statutory and consolidated financial
statements as presented by the General Partner; the consideration and
approval of the appropriation of the result of the year as proposed by
the General Partner; the appointment, removal and remuneration of
the Board of Overseers; and the discharge to be given to the General
Partner and to the members of the Board of Overseers. All other
business at an annual general meeting shall be considered only upon
a proposal of the General Partner unless otherwise provided for in
the law.
Any other matter which does not fall within the scope of an annual
general meeting, as set out above, shall be dealt with by way of an
extraordinary meeting. An extraordinary meeting shall require that
50 per cent of shareholders of each class of shares is represented,
failing which the meeting must be reconvened in accordance with the
notice requirements laid down by the law. Resolutions proposed at
such a meeting shall be passed by a vote in favour of at least two-thirds
of the votes cast, provided that no resolution tabled at such a meeting
shall be validly passed unless approved by the General Partner.
The annual general meeting of shareholders of the Company was
held on 29 August 2023. Out of a total of 195 941 286 ordinary
shares and 1 000 management shares in issue, a total of 135 432 675
ordinary shares (some 69.12 per cent of the total voting rights) and
all the 1 000 management shares were represented. The proposals of
the General Partner in respect of the resolutions considered at the
meeting were approved by an overwhelming majority of the votes.
The notice of the 2024 annual general meeting of shareholders is
given on pages 84 to 86 of this report.
FINANCIAL REPORTING, INTERNAL
CONTROL AND RISK MANAGEMENT
The preparation of the statutory and consolidated financial statements
of the Company is the responsibility of the General Partner. The
Company’s role is limited to the holding of the investment in
Reinet Fund, the issuance of its own shares and related activities and
therefore its own entity financial statements are straightforward. The
Board of Directors of the General Partner has established strict rules
designed to protect the Company’s interests in the areas of financial
reporting, internal control and risk management. An internal
control process has been defined and implemented by the Board
of Directors of the General Partner and approved by the Board
of Overseers, with the aim of achieving reliability of financial and
accounting information and full compliance with applicable laws
and regulations. The internal controls over financial reporting are
designed to provide assurance that the financial reporting does not
contain any material inadequacies. The level of financial controls
that have been established are considered by the General Partner
to be adequate for the scale of the Company’s and Reinet Fund’s
operations and their level of complexity.
A risk management function exists and quarterly reports are
provided to the Boards of Directors of the General Partner and the
Fund Manager, as well as the Board of Overseers.
The internal audit function is outsourced; an internal audit report
is provided annually and the internal auditor attends at least one
meeting of the Board of Overseers.
Responsibility for management of investment risk and treasury risk
is borne by the Board of Directors of the Fund Manager. The day-
to-day treasury position is monitored by the Chief Executive Officer
and the Chief Financial Officer and policy decisions in respect of the
investment of cash resources are taken by the Board of Directors of
the Fund Manager.
Investment decisions are the responsibility of the Fund Manager,
acting on the advice of the Investment Advisor, as appropriate.
The Company is subject to financial risks, certain of which are
discussed in note 5 to the consolidated financial statements on
page53 of this report.
REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
INFORMATION POLICY
The Company reports to shareholders in accordance with the
requirements of Luxembourg law, European regulations and
the guidance provided by the Luxembourg Stock Exchange,
the Commission de Surveillance du Secteur Financier (‘CSSF’),
Euronext Amsterdam and Autoriteit Financiële Markten (‘AFM’),
the Dutch Authority for the Financial Markets. The annual report
is the principal source of financial and business information for
shareholders. The Company’s preliminary announcement of the
results for the financial year is usually issued in May each year.
In addition to the annual report, the Company publishes its half-
yearly unaudited financial report in November, as well as interim
management statements in July and January covering the Company’s
performance during the first and third quarters, respectively, of the
financial year. Ad hoc news announcements are made in respect
of matters which the Company considers to be of significance to
shareholders, in accordance with applicable laws and regulations
(including EU Regulation No 596/2014 on Market Abuse) and the
specific guidelines laid down by the Luxembourg Stock Exchange,
the CSSF, Euronext Amsterdam and the AFM.
The annual report is distributed to all parties who have requested a
copy. Investors may request electronic notification that such reports
have been published on the Company’s website.
All news announcements are distributed by email. Shareholders and
other interested parties may ask to be included on the distribution
list by contacting the Company Secretary at the Company’s
registered office or by email (info@reinet.com) or by registering on
the Company’s website (http://www.reinet.com/investor-relations/
company-announcements).
Copies of the annual report and half-yearly unaudited financial
report, the announcement of the results and ad hoc press
releases may also be downloaded from the Company’s website
(www.reinet.com). A copy of the Statutes of the Company and the
Corporate Governance Charter are available on the website.
Statutory and regulatory announcements are filed with the CSSF
and the AFM, published on the Company’s website and made
available to the Luxembourg Stock Exchange and Euronext
Amsterdam. The Company’s listing on the Johannesburg Stock
Exchange is a secondary listing, and pursuant to Section 18.21 of
the Johannesburg Stock Exchange Listings Requirements is required
to announce on the Stock Exchange News Services the equivalent
information that is made publicly available on the Luxembourg
Stock Exchange and on Euronext Amsterdam.
AUDITORS
The statutory and consolidated financial statements of the Company
for the accounting year ended 31 March 2024 were audited by
PricewaterhouseCoopers, Société coopérative, approved statutory
auditors, Luxembourg.
SUSTAINABILITY
The Company’s approach to sustainability matters and its report
on corporate social responsibility for the accounting year ended
31March 2024 are included in the Sustainability Report appended
to the management report on page 37.
ARTICLE 11 OF THE LUXEMBOURG LAW
ON TAKEOVER BIDS OF 19 MAY 2006
The Company publishes the following detailed information as
required by Article 11 (1) of the law of 19 May 2006 on takeover bids.
CAPITAL STRUCTURE OF THE COMPANY
The Company has issued two classes of shares, namely management
shares and ordinary shares. The ordinary shares are listed on the
Luxembourg Stock Exchange, Euronext Amsterdam and the
Johannesburg Stock Exchange; the listing on the Johannesburg
Stock Exchange is a secondary listing.
At 31 March 2024, the Company had 195 941 286 ordinary shares
and 1 000 management shares of no par value in issue.
At 31 March 2024, the Company held 14 151 395 ordinary shares
as treasury shares. The voting and dividend rights attached to
treasury shares are suspended. Therefore, the total number of voting
rights at 31 March 2024 was 181 790 891.
The ordinary shares confer on the shareholder the entitlement to
participate in and, except for the treasury shares, to vote at meetings
of shareholders, with each share carrying the right to one vote. Each
share, except for the treasury shares, also entitles each shareholder to
receive a proportionate share of any dividend that the Company may
declare and a proportionate share of the net assets of the Company
on liquidation. The liability of shareholders is limited to the amount
of their investment in the Company.
The management shares confer the same rights with regard to
voting, dividends and the distribution of assets on liquidation as the
ordinary shares. In addition, as the holder of the management shares,
the General Partner has broad powers to manage the Company and
has unlimited liability for any obligations of the Company that
cannot be met out of the assets of the Company. The management
shares are not listed.
RESTRICTIONS ON THE TRANSFER OF
SECURITIES
The ordinary shares are freely transferable. The Company and its
shareholders must comply with the requirements of the Luxembourg
law of 11 January 2008 on transparency requirements as amended
(the ‘Transparency Law’), provided however that in addition to the
thresholds set out in such law, each shareholder shall, in accordance
with the Statutes, be liable to notify the Company of any acquisition
or disposal if the proportion of the holding of shares held by the
shareholder, whether directly and/or indirectly, including those that
are deemed to be controlled by the shareholder in the circumstances
contemplated by Article 9 of the Transparency Law, reaches, exceeds
or falls below the threshold of 3 per cent, failing which the General
Partner may disregard the voting rights attached to the shares and
certain restrictions may apply to such shareholdings in accordance
with the terms of Article 10 of the Statutes.
The management shares are transferable only to a successor or an
additional manager with unlimited liability for the Company’s
financial liabilities.
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
MANAGEMENT REPORT
CORPORATE GOVERNANCE
CONTINUED
SIGNIFICANT SHAREHOLDERS
The details of significant shareholders within the meaning of the
Transparency Law are given on page 33 of this report.
SEPARATE CLASSES OF SECURITIES
The management shares held by the General Partner confer the same
rights with regard to voting, dividends and the distribution of assets
on liquidation as the ordinary shares. In addition, as the holder of
the management shares, the General Partner shall have broad powers
to manage the Company. The General Partner will have unlimited
liability for any obligations of the Company that cannot be met out
of the assets of the Company.
SHARES HELD IN RESPECT OF SHARE INCENTIVE
SCHEMES FOR EMPLOYEES OF THE GENERAL
PARTNER, FUND MANAGER AND INVESTMENT
ADVISOR
The Investment Advisor owns 863 581 ordinary shares of the
Company as at 31 March 2024 (31 March 2023: 916 512). These
shares have been acquired to hedge share appreciation rights
and related awards to employees including key executives. Until
the rights awarded under these schemes may be exercised by the
employees and key executives concerned, the voting rights in respect
of these shares may be exercised by the Investment Advisor.
SHAREHOLDERS’ MEETINGS AND VOTING
RIGHTS
Each issued share represents one vote, except for the treasury shares.
The voting and dividend rights attached to the treasury shares are
suspended. The rights of a shareholder to participate in a general
meeting and to vote in respect of their shares shall be determined
with respect to the shares held by the shareholder on the 14th
day prior to the general meeting, as required by Luxembourg law.
Further information is set out above.
SHAREHOLDER AGREEMENTS AND TRANSFER
RESTRICTIONS
There are no agreements between shareholders which are known to
the Company. The Company is not aware of any agreements which
may result in restrictions on the transfer of securities or voting rights.
RULES GOVERNING THE APPOINTMENT OF THE
GENERAL PARTNER AND AMENDMENTS TO THE
STATUTES OF THE COMPANY
The Company has no executive management or employees. In
accordance with Luxembourg law, the management of the Company
is carried out by the General Partner, the unlimited shareholder of
the Company, which has been designated as such in the Statutes.
The replacement of the General Partner or the appointment of
additional managers requires an amendment to the Statutes.
Any proposal to amend the Statutes shall be considered and
approved by an extraordinary general meeting of shareholders to
be held before a public notary. At any such meeting, 50 per cent
of shareholders of each class of shares is required to be present or
represented. Resolutions shall be passed by at least two-thirds of the
votes cast, provided that no resolution at any extraordinary general
meeting of shareholders shall be validly passed unless approved
by the General Partner, unless otherwise provided by law and the
Statutes. In that respect it is to be noted that no decision of the
General Partner on behalf of the Company in respect of the exercise
by the Company of any power to amend the Statutes shall be valid
unless approved by the Board of Overseers.
POWERS OF THE GENERAL PARTNER
The General Partner is vested with the broadest powers to perform all
acts of administration in compliance with the Company’s corporate
objects set out in the Statutes except for matters expressly reserved
by Luxembourg law or the Statutes to be approved by the general
meeting of shareholders. Certain decisions of the General Partner
must be approved by the Board of Overseers.
SIGNIFICANT AGREEMENTS
There are no significant agreements to which the Company is a party
and which take effect, alter or terminate upon a change of control of
the Company following a takeover bid.
AGREEMENTS WITH DIRECTORS AND
EMPLOYEES
The Company is managed by the General Partner; it has no directors,
executive management or employees. Details of the agreements with
the General Partner, the Fund Manager and the Investment Advisor
are set out on page 32 of this report.
REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
SUSTAINABILITY REPORT
Introduction
The business philosophy of Reinet Investments S.C.A. (‘Reinet
Investments’) and its subsidiary Reinet Fund S.C.A., F.I.S. (‘Reinet
Fund’, together with Reinet Investments, ‘Reinet’) is to identify
and invest in assets that offer long-term growth potential. Having
a long-term view enables Reinet to build sustainable value for
stakeholders. Recognising the world’s resource limitations and the
need for responsible business practices, Reinet looks for responsible
management in its investments. The same principles of responsible
and ethical business conduct also guide Reinet’s own operations and
are fundamental to how it conducts business and engages with its
stakeholders. Reinet’s policies on governance and sustainability outline
its willingness to integrate non-financial aspects into its activities and
business.
This Sustainability Report, which covers the year ending
31March2024, has been prepared in accordance with the X Principles
of Corporate Governance of the Luxembourg Stock Exchange (the
‘X Principles’), most specifically with Principle number 9 relating
to sustainability (see X Principles on page 38). In order to comply
with Principle 9 of the X Principles, Reinet has a clearly defined
Sustainability Policy that sets out the principles of its approach to
key environmental, social and governance topics. Reinet used the
Sustainability Accounting Standards Board (‘SASB’) Standards
(specific to the Asset Management and Custody Activities) for the
identification of material sustainability topics relevant to its business
and stakeholders (see Material Sustainability Topics identified by
SASB Standards on page 38).
Overall responsibility for Reinet’s sustainability obligations and
reporting lies with the board of directors of the general partners of
Reinet Investments and Reinet Fund (the ‘General Partners’). The
General Partners oversee Reinet’s long-term sustainability approach
by regularly considering its sustainability risks and implementing the
Sustainability Policy (see About Reinet on this page). Reinet Fund
Manager S.A. (the ‘Fund Manager’), whose primary fiduciary duty
is to deploy capital for attractive long-term returns, ensures that
sustainability topics are considered amongst others in its investing
processes.
To ensure Reinet’s sustainability approach and disclosures remain
compliant, all relevant and regulatory developments in this area
are actively monitored. In 2022, Reinet undertook a review to
understand the disclosure requirements of existing and upcoming
EU regulations, identifying the Corporate Sustainability Reporting
Directive (‘CSRD’) as having the most potential future impact on
Reinet. Reinet is monitoring any upcoming implications of the
CSRD in Luxembourg to prepare for compliance if applicable.
This report begins with an introduction to Reinet’s management
structure and investments, followed by an overview of how it takes
into account and reports in line with the X Principles. Subsequent
sections of the report are then structured in line with relevant SASB
topics, including an overview of how Reinet incorporates sustainability
into its investment practices and the sustainability approach of key
investments. The report concludes by looking ahead at legislative
developments for Reinet to consider how this will impact its approach
in future.
About Reinet
Structure and management
Reinet Investments is a securitisation vehicle incorporated
and existing under the laws of Luxembourg. It is listed on the
Luxembourg Stock Exchange, Euronext Amsterdam and the
Johannesburg Stock Exchange; the listing on the Johannesburg
Stock Exchange is a secondary listing. Reinet Fund is a wholly owned
subsidiary of Reinet Investments and is a closed-ended, specialised
investment fund. Reinet Fund is also the investment vehicle for all
the investment assets held within the structure.
Reinet Investments
Manager
Reinet Fund
Manager
Shareholders
Reinet Investments
Reinet Fund
Assets
GENERAL PARTNERS
REINET
Reinet Investments and Reinet Fund are each managed by a general
partner, respectively Reinet Investments Manager S.A. (‘Reinet
Investments Manager’) and the Fund Manager which carries out
the role generally performed by the board of directors and the
general management of a corporation and as such neither Reinet
Investments nor Reinet Fund has a board of directors, executive
management or employees. In addition, Reinet Investments and
Reinet Fund are subject to review by the Board of Overseers, which
is responsible for monitoring compliance with legal and regulatory
obligations, overseeing reporting processes and its integrity, and
reviewing the effectiveness of internal control and risk management
procedures, among other duties.
Assets and investments
Reinet Fund seeks to build partnerships with other investors,
specialised fund managers and entrepreneurs to identify and develop
opportunities for long-term value creation for its shareholders. Since
its formation in 2008, Reinet Fund has invested over € 3.7billion.
This year, Reinet Fund has continued to allocate capital to
investments with a primary focus on assets with long-term growth
potential across sectors. Listed or regulated investments currently
represent in excess of 79 per cent of the net asset value of Reinet
Fund (‘NAV’).
As a result of market movements and portfolio rebalancing over the
past years, Pension Insurance Corporation Group Limited (‘Pension
Corporation’), a UK-based insurance company specialising in
securing the liabilities of defined benefit pension schemes, now
represents Reinet Fund’s largest investment, approximately
56percent of the NAV. The investment in British American Tobacco
p.l.c. (‘BAT’) now represents approximately 22 per cent of the NAV.
Over the years, the exposure to BAT has been significantly reduced;
this represented some 80 per cent of the NAV at 31 March 2009.
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The investment in BAT provides Reinet Fund with the capacity
to fund new opportunities, either from dividend income, through
borrowing, or through the realisation of part of the investment.
This ensures that there is liquidity available at the level of Reinet
Fund, including during times of market distress, to invest to support
long-term performance.
Together, the investments in Pension Corporation and BAT represent
approximately 78 per cent of the NAV; each of these investee
entities has integrated sustainability in its strategy (see Sustainability
approaches for key investments on page 40). Reinet Fund also
invests in funds managed by third parties. These include funds
managed by Trilantic Capital Partners, TruArc Partners, Milestone
Capital, Prescient Investment Management China, ND Capital,
Asia Partners and Coatue.
Reinet Fund – Total assets under management
31 March 2024
€ m
31 March 2023
€ m
Assets
Listed equity securities 1 452 1 644
Unlisted equity securities and funds 4 685 3 990
Loans and interest receivable 14 19
6 151 5 653
Cash and cash equivalents 356 288
Other assets 33 32
Total assets
6 540
5 973
(See Sustainability approaches for key investments on page 40).
SUSTAINABILITY REPORT
CONTINUED
The X Principles
This Sustainability Report has been prepared in accordance with
the X Principles, more specifically with Principle number 9 relating
to sustainability. The X Principles consist of a list of 10 corporate
governance principles set by the Luxembourg Stock Exchange in
2006 with the aim of integrating non-financial considerations
into the governance of companies that have securities listed
on the Luxembourg Stock Exchange. The latest update from
January2024 highlights the importance of embedding sustainability
considerations into the management of environmental, social and
governance (‘ESG’) risks and opportunities, and stronger integration
of sustainable aspects into a company’s strategy.
Reinet Investments, as a listed entity on the Luxembourg Stock
Exchange, is subject to and is in compliance with the X Principles
to the extent they are applicable. However, these principles do not
apply to unlisted entities and regulated funds and are thus not
applicable to its subsidiary Reinet Fund which currently has no
sustainability reporting obligations. Despite this, Reinet has, for the
purposes of this Sustainability Report, continued to implement the
requirements of Principle 9 pertaining to sustainability on a look-
through basis to Reinet Fund, where relevant.
The board of directors of the General Partners holds ultimate
responsibility for Reinet’s approach and obligations in respect of
sustainability, including considering ESG risks in its strategy. They are
also responsible for overseeing the development and implementation
of policies and procedures related to key sustainability matters and
ensuring the effective monitoring of each policy. The Fund Manager
reviews non-financial risks as part of its risk management activities
relating to Reinet Fund’s investment portfolio. These activities will
cover the non-financial risks pertaining to the investee companies,
as included in the due diligence policy, relating to:
• Disputes
• Employee matters
• Anti-corruption policies and rules
• Impact of the investee company’s activities on the environment
• Health and safety issues
In order to improve its approach to sustainability and comply with
the applicable laws and regulations, Reinet continuously adapts and
develops its policies (see Business Ethics on page 39).
In accordance with Principle 9 of the X Principles, the Sustainability
Report is published and accessible on Reinet Investments’ website.
Material Sustainability Topics identified by SASB Standards
As in previous years, Reinet continues reporting in line with selected
industry specific SASB topics and metrics (in addition to the
XPrinciples), as the SASB Standards represent a globally recognised
and accepted sustainability framework. The SASB Standards were
set up in 2011 to enable businesses to identify and communicate
industry-specific, financially-material sustainability topics for
investors. Given Reinet’s business and activities, SASB Standards are
the most appropriate recognised international framework in terms
of sustainability reporting.
The SASB Standards, specific to the Asset Management and Custody
Activities industry, have identified the following sustainability topics
as material:
• Business Ethics
• Transparent Information and Fair Advice for Customers
• Incorporation of ESG Factors in Investment Management and
Advisory
• Employee Diversity & Inclusion
• Financed Emissions
The following section outlines Reinet’s response in relation to
these material topics, with the exception of Employee Diversity &
Inclusion and Financed Emissions (see Omissions from SASB on
page 41).
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Business Ethics
There have been no legal proceedings associated with fraud,
insider trading, anti-trust, anti-competitive behaviour, market
manipulation, malpractice or other related financial industry laws
or regulations in the reporting year in relation to Reinet.
As a result, no monetary losses were recorded in respect of these
matters. To address the risk of insider trading and to comply with
applicable laws and regulations, Reinet Investments has adopted
a Code of Conduct. This restricts persons connected with Reinet
Investments, Reinet Fund, the General Partners and with Reinet
Investment Advisors Limited (the ‘Investment Advisor’) from
trading in shares issued by Reinet Investments and derivatives
thereof (‘Reinet securities’) when in possession of any price-sensitive
information.
Specific approval to buy or sell Reinet securities is required from
designated officers of the General Partners. Transactions by members
of the Board of Directors of the General Partners and the Board of
Overseers, as well as any other persons closely associated with any
of them, are published on Reinet’s website, in a manner that ensures
the effective dissemination of the information to the public and
through storage on the regulatory filing mechanism operated by the
Luxembourg Stock Exchange.
The Code of Conduct also imposes restrictions on dealings by
persons connected with Reinet Investments, Reinet Fund, the
General Partners and the Investment Advisor in assets in which
Reinet Fund has invested, or may consider investing in.
Reinet’s Conflicts of Interest Policy, which was prepared in line with
applicable laws and regulations, aims to ensure that Reinet shall make
decisions without any conflicts of interest. Furthermore, a policy
on Related Party Transactions was adopted by Reinet Investments
to provide guidance on the current rules and requirements for
reviewing, approving and disclosing all related party transactions.
Developed in November 2023, the Whistleblowing Policy allows
anyone involved in the administrative, management or supervisory
bodies of the General Partners to report suspected breaches of
applicable laws and regulations. The policy protects whistleblowers
from retaliation, victimisation or subsequent discrimination,
whether they report internally or externally.
For anti-money laundering and counter-terrorist financing
matters, a reporting procedure has been put in place by the Fund
Manager. Reinet Fund’s Anti-Money Laundering and Counter-
Terrorist Financing Policy has been updated in November 2023 in
compliance with applicable laws, regulations and best practice. This
policy is based on a risk-based approach according to which a risk
level is allocated to each of Reinet Fund’s business relationships (its
investors, investees and key counterparties) in order to determine
the level of due diligence conducted and the frequency of review.
Reinet Fund’s commitment to prevent and minimise risks is further
strengthened by the risk appetite statement, which was approved
by the Board of Directors of the Fund Manager in accordance with
Article 4 (4) of the CSSF Regulation 12-02 on the fight against
money laundering and terrorist financing, as amended. The
statement clearly defines Reinet Fund’s risk tolerance, enabling the
Fund Manager to effectively assess its risk exposure level, thereby
establishing adequate and proportionate controls and processes.
Reinet takes a zero-tolerance approach to bribery and corruption
and is committed to acting professionally, fairly and with integrity
in all its business dealings and relationships. It has adopted an
Anti-Corruption and Bribery Policy which provides guidance and
outlines the responsibilities of all directors and employees of the
General Partners, and of those working for and on Reinet’s behalf,
in observing and upholding its position on bribery and corruption.
In addition, Reinet uses Transparency International’s Corruption
Perception Index and a cutting-edge screening tool to assess the risks
within its investments.
Finally, Reinet also developed an Anti-Harassment Policy in
November 2023, with the purpose of ensuring an environment free
from any form of harassment and prohibiting wilful discrimination
based on age, sexual orientation, ethnicity, race, religion or disability.
Key policies are subject to regular internal reviews and any changes
are properly communicated to and well understood by relevant
individuals, with training provided on any new or updated policies
as required. Additionally, a compliance review is conducted
periodically by the internal auditor to ensure Reinet Investments
and Reinet Fund comply with their key policies. Any potential issues
identified from the assessment are promptly discussed and reported
to the Board of Overseers and the General Partners, followed by
appropriate corrective actions if required.
To ensure that policies are followed and understood they are
available to all employees of the General Partners, and compliance
is assessed annually.
Transparent Information & Fair Advice for Customers
Reinet Investments’ customers are deemed to be its shareholders.
To ensure that shareholders are provided with timely and
comprehensible information relating to Reinet Investments,
Shareholder Communication Policy has been adopted. This policy
creates a framework for communication of transparent and relevant
information to enable all shareholders to exercise their rights.
Reinet Investments’ Annual Report is the principal source of
financial and business information for shareholders. The Annual
Report is distributed to all parties who have requested a copy.
Electronic notification that such reports have been published
on Reinet’s website is available on request. In addition, Reinet
Investments prepares a half-yearly report, supplemented by quarterly
updates to provide further insight into the investment activities and
performance over the relevant reporting period. All information
required by laws and regulations, along with the combined Annual
Report and Sustainability Report, is available to shareholders on a
dedicated section of the website.
Reinet aims to conduct business in a manner that limits complaints.
A Complaints Management Policy is in place to ensure that
complaints are handled properly and promptly while meeting the
complainant’s interests, in line with applicable regulation issued
by the Commission de Surveillance du Secteur Financier (‘CSSF’).
The complaints handling procedure is available on the Reinet
Investments’ website.
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MANAGEMENT REPORT
SUSTAINABILITY REPORT
CONTINUED
Incorporation of ESG Factors in Investment Management & Advisory
As an investor, Reinet Fund, the wholly owned subsidiary of Reinet
Investments, intends to act responsibly and ethically, and invest in
companies that share its business philosophy to think long-term
about business and material sustainability risks. This commitment is
contained in the standalone sustainability policy that applies to both
Reinet Investments and Reinet Fund.
• Society and communities: respecting the people it works with
and communities in which it operates.
• Anti-corruption: reviewing the target companies’ anti-corruption
policies, their implementation and related reporting.
• Environment: demonstrating respect for the environment by
encouraging investee entities to reduce their environmental
footprint, to improve resource efficiency and manage their
material sustainability risks.
• Responsible business practice: act as a socially responsible
business, demonstrating strong integrity, accountability, and
transparency.
In order to consider ESG as part of investment decisions, the
Fund Manager assesses the non-financial risks associated with
its investments as part of the due diligence process prior to the
acquisition of new assets. Reinet Fund has a Due Diligence Policy
and Checklist which sets out the process to be followed in respect
of due diligence to be conducted, intending to gain a thorough
understanding of prospects for each investment and evaluate
potential and inherent risks it faces or may have to face in the future.
It covers a review of, if relevant, employment practices of the target
company, anti-corruption policies and enforcement, environmental
reports or audits, and checks for compliance with all relevant
environmental laws.
The outcome of the due diligence analysis is considered in assessing
whether or not to proceed with an investment opportunity. Where
important areas have been identified, regular monitoring of investee
entities takes place alongside quarterly reporting on key trends and
risks where relevant.
Sustainability approaches for key investments
Reinet Fund’s major investments, Pension Corporation and BAT,
operate in highly regulated industries and/or public markets. They
have both integrated sustainability within their business practices
and publicly report on material topics in line with externally
recognised sustainability principles and frameworks, as outlined
below.
The purpose of Pension Corporation is to pay the pensions of current
and future policyholders. The assets Pension Corporation invests in
must therefore be sustainable with business models that can survive
changing environments. Pension Corporation has focused on assets
which are socially beneficial and will meet the needs of society in
the future, such as investments in social housing, renewable energy,
higher education and long-term infrastructure projects.
Pension Corporation’s sustainability strategy incorporates ESG
risks in investment decisions as well as engagement with investee
companies to improve their sustainability performance. Pension
Corporation has published its sustainability policy, while establishing
a net zero working group to support its commitment to reach net
zero within its investment portfolio by 2050. In 2023, Pension
Corporation published its ESG and TCFD reports, and took
steps towards launching its sustainability strategy and publishing
standalone stewardship and ESG policies.
BAT has an open dialogue with stakeholders at local, regional and
global levels on key sustainability issues affecting its industry. BAT’s
own sustainability strategy is built on improving the health impact of
its business by giving customers greater choice and deploying world-
class science in the development of products. It has made significant
progress to develop and grow new categories of reduced risk products
to meet evolving consumer preferences. This is supported by other
sustainability priorities, ie (a) environmental strategy which includes
carbon neutrality, water, waste and sustainable agriculture, (b) social
impact strategy which includes human rights, farmer livelihood,
health and safety, people and culture and (c) robust corporate
governance.
In 2022, BAT committed to a new low-carbon transition plan that
aims to halve absolute emissions across its value chain by 2030. In
2023, BAT updated its double materiality assessment undertaken
in 2022, guided by the latest available European Sustainability
Reporting Standards (‘ESRS’) to align with key elements of reporting
frameworks such as the CSRD. BAT published its Combined
Annual and Sustainability report 2023 on its website.
Aside from Pension Corporation and BAT, certain other funds in
which Reinet Fund invests have also incorporated sustainability
factors evaluating the ESG risks and opportunities associated with
investments through pre-acquisition due diligence, as outlined below.
Substantial commitments have been made over the years to funds
managed by Trilantic Capital Partners and TruArc Partners. These
operations both have well established sustainability principles and
practises which guide their investment strategy and operating models.
Asia Partners has a responsible investment policy and is committed
to (a) ensuring ESG issues are identified and managed responsibly
in their business activities and relationships, and to (b) investing in
businesses with the intent to contribute to measurable positive social
or environmental impacts, alongside financial returns, and (c) strive
to ensure that impact considerations are purposefully integrated
throughout the investment lifecycle.
In 2022, Reinet Fund invested in a fund managed by Coatue,
an American technology-focused investment manager. Coatue,
a signatory to the United Nations Principles for Responsible
Investment (‘UN PRI’), invests in public and private markets with a
focus on technology, media, telecommunication, the consumer and
health care sector, and supports sustainable innovation in a range
of ways.
In summary, Reinet aims to make value-aligned investment
decisions that offer long-term growth potential to its shareholders.
It also recognises that the sustainability landscape is continuously
evolving and that there is growing stakeholder expectation for
greater investment clarity and more responsible investment
strategies. To respond to this, Reinet aims to advance its reporting
ambitions year-on-year and if required work alongside third-party
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41 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
sustainability experts to support it on its journey. Reinet has
defined its Sustainability Policy and aims to comply with recognised
international standards and frameworks for sustainability, developing
a roadmap identifying priority sustainability areas and actions to
improve transparency and disclosure. Reinet Fund assesses the
activities of investee entities regularly as part of its on-going review
of its investment portfolio and of the risk management process,
in which sustainability factors are incorporated. Reinet Fund has
not adopted a formal proxy voting policy and is not required to
do so pursuant to laws and regulations applicable to it; currently
it holds no formal measurement for the amount of assets under
management that employ the integration of sustainability issues and
sustainability-themed investing or screening.
Omissions from SASB
Owing to the structure of the business, some topics identified by
SASB as material to the Asset Management and Custody Activities
industry do not apply to Reinet.
Employee Diversity and Inclusion
Reinet does not have any operations, executive management,
non-executive management, professionals or other employees of
its own. This means that considerations of employee diversity and
inclusion are not applicable to Reinet.
Financed Emissions
In 2023, SASB introduced new topics and metrics covering
financed emissions, on which entities are expected to report for
annual periods beginning on/or after 1 January 2025. Reinet will be
closely monitoring the regulatory implications of CSRD regarding
disclosures of financed emissions and will take necessary steps to
disclose such information if this is deemed applicable in future.
Total Assets under Custody and Supervision
As required under applicable laws and regulations, Reinet
Investments has entrusted the custody of its assets to Banque de
Luxembourg, a credit institution established in Luxembourg.
Banque de Luxembourg is also in charge of the supervision of Reinet
Fund’s assets.
Looking ahead
Future ambitions for Reinet’s approach to sustainability disclosure
include continuing to report annually in line with the SASB
Standards (as applicable) and Principle number 9 of the X Principles.
Reinet will continue exploring ways to pursue investments that are
aligned with sustainability goals.
Reinet is currently assessing its readiness for the implementation
of CSRD, and is closely monitoring its applicability within
Luxembourg. Reinet will undertake an ongoing review to stay
abreast of future guidelines, particularly any European Financial
Reporting Advisory Group publications regarding CSRD, as well
as any other regulatory developments that may impact its future
reporting.
Reinet has a clearly defined Sustainability Policy that has been
communicated internally and plans to use it to enhance its
commitment and overall approach to sustainability going forward.
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APPROVAL
The General Partner, acting on behalf of the Company, represented
by Wilhelm van Zyl, its Chief Executive Officer and Diane Longden,
its Chief Financial Officer, confirms that:
1. The consolidated financial statements have been prepared in
accordance with IFRS as adopted by the European Union and
give a true and fair view of the consolidated assets, liabilities,
financial position and profit of the Company and its subsidiaries
taken as a whole;
2. The Company financial statements have been prepared in
accordance with Luxembourg legal and regulatory requirements
and give a true and fair view of the Company’s assets, liabilities,
financial position and profit for the year; and
3. This report includes a fair review of the development and
performance of the business and position of the Company and
its subsidiaries taken as a whole, together with a description of
the principal risks and uncertainties that they face.
The consolidated financial statements for the year ended 31 March 2024
on pages 45 to 71 and the Company financial statements on pages 75
to 80 of this report were approved for submission to the annual general
meeting of shareholders by the Board of Directors of the General Partner
and signed on its behalf by Wilhelm van Zyl and Diane Longden.
Wilhelm van Zyl Diane Longden
Chief Executive Officer Chief Financial Officer
Reinet Investments Manager S.A.
General Partner
Luxembourg, 23 May 2024
MANAGEMENT REPORT
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REPORT OF THE BOARD OF OVERSEERS
Pursuant to Articles 600-2 and 443-2 of the Luxembourg
company law and Article 18 of the Statutes, we hereby report to
the shareholders’ meeting in respect of the accounting year ended
31 March 2024 and the financial statements prepared for such
period.
The consolidated and statutory financial statements of the
Company have been audited by the approved statutory auditor,
PricewaterhouseCoopers, Société coopérative, Luxembourg, in
accordance with international standards on auditing. The audit
reports on the consolidated and statutory financial statements
of the Company are presented on pages 72 and 82 of this report,
respectively.
We refer to those consolidated and statutory financial statements,
which we have reviewed and discussed with the approved statutory
auditor who is of the opinion that these provide a true and fair view
of the financial situation of the Company.
During the period referred to previously, we met regularly with
management, reviewed the quarterly financial reports of the
Company and have been kept fully informed by the Board of
Directors of the General Partner about developments in the
Company.
The Board of Overseers recommends that the consolidated and
statutory financial statements of the Company, to be presented to
the annual general meeting of shareholders of the Company, be
approved.
The Board of Overseers
Reinet Investments S.C.A.
Luxembourg, 27 May 2024
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45 Consolidated financial statements
45 Consolidated balance sheet
46 Consolidated statement of comprehensive income
47 Consolidated statement of changes in equity
48 Consolidated cash flow statement
49 Notes to the consolidated financial statements
72 Audit report
75 Company financial statements
75 Balance sheet
76 Profit and loss account
77 Notes to the financial statements
81 Proposed appropriation of retained earnings
82 Audit report
FINANCIAL STATEMENTS
Reinet Investments S.C.A. (the ‘Company’) has determined that it meets the definition of an investment entity under International Financial Reporting Standard 10, as
a result, its subsidiaries are consolidated in the fair value of Reinet Fund S.C.A., F.I.S., which is disclosed as one line item in the consolidated balance sheet and elsewhere
in the consolidated financial statements as ‘financial assets held at fair value through profit or loss’. The consolidated net asset value, income and cash flow statements are,
however, disclosed in more detail in the business overview as in prior years.
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CONSOLIDATED BALANCE SHEET
Notes
31 March 2024
€ m
31 March 2023
€ m
ASSETS
Non-current assets
Financial assets held at fair value through profit or loss 4, 5 6 185 5 721
Total assets 6 185 5 721
EQUITY
Equity attributable to the shareholders
Share capital 8 220 220
Share premium 770 770
Treasury shares 8 (222 ) (222 )
Non-distributable reserve 9 22 22
Retained earnings 5 394 4 930
Total equity 6 184 5 720
LIABILITIES
Current liabilities
Amounts owed to affiliated undertakings – becoming due and payable after less
than one year 10 1 1
Total liabilities 1 1
Total equity and liabilities 6 185 5 721
Net asset value per share (€ per share)
(based on 181.8 million shares (31 March 2023: 181.8 million shares)) 34.02 31.46
The notes on pages 49 to 71 are an integral part of these consolidated financial statements.
CONSOLIDATED FINANCIAL STATEMENTS
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Notes
Year ended
31 March 2024
€ m
Year ended
31 March 2023
€ m
Income
Dividend received from Reinet Fund S.C.A., F.I.S. 58 55
Net change in the fair value of financial assets at fair value through profit or loss 4 464 (171 )
Total income 522 (116 )
Expenses
Operating expenses 3 4
Total expenses 3 4
Profit/(loss) for the year 519 (120 )
Earnings per share from profit/(loss) for the year (€ per share)
– basic and diluted 12 2.85 (0.66 )
The notes on pages 49 to 71 are an integral part of these consolidated financial statements.
CONSOLIDATED FINANCIAL STATEMENTS
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ANNUAL REPORT 2024
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Attributable to the shareholders
Note
Equity
holders’
capital
€ m
Treasury
shares
€ m
Non-
distributable
reserve
€ m
Retained
earnings
€ m
Total
€ m
Balance at 31 March 2022 990 (223 ) 22 5 101 5 890
Dividend paid – – – (51 ) (51 )
Repurchased shares 8 – 1 – – 1
Loss attributable to the shareholders – – – (120 ) (120 )
Balance at 31 March 2023
Dividend paid – – – (55 ) (55 )
Repurchased shares 8 – – – – –
Profit attributable to the shareholders – – – 519 519
Balance at 31 March 2024 990 (222 ) 22 5 394 6 184
The notes on pages 49 to 71 are an integral part of these consolidated financial statements.
48
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
CONSOLIDATED CASH FLOW STATEMENT
Year ended
31 March 2024
€ m
Year ended
31 March 2023
€ m
Cash flows from operating activities
Dividend received from Reinet Fund S.C.A., F.I.S. 58 55
Operating expenses (3 ) (6 )
Net cash from operating activities 55 49
Cash flows used in financing activities
Repayment of capital by Reinet Fund S.C.A., F.I.S. – 40
Repurchased shares – (45 )
Dividend paid (55 ) (51 )
Net cash used in financing activities (55 ) (56 )
Net movement in cash and cash equivalents – (7 )
Cash and cash equivalents at beginning of the year – 7
Cash and cash equivalents at end of the year – –
The notes on pages 49 to 71 are an integral part of these consolidated financial statements.
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
49 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
1. GENERAL INFORMATION
1.1 STATUS
in Luxembourg as a partnership limited by shares (société en
commandite par actions) and is governed by the Luxembourg law on
securitisation. The Company’s registered office is at 35, boulevard
The Company is managed by Reinet Investments Manager S.A. (the
‘General Partner’), a limited company established in Luxembourg
(société anonyme), which also owns 1 000 management shares in the
Company. The General Partner is liable for any obligations of the
Company that cannot be met out of the assets of the Company. The
General Partner’s registered office is at 35, boulevard Prince Henri,
L-1724 Luxembourg.
The Company owns the entire ordinary share capital of Reinet
Fund S.C.A., F.I.S. (‘Reinet Fund’), a specialised investment fund
established as a partnership limited by shares (société en commandite
par actions) under the laws of Luxembourg. Reinet Fund’s registered
office is at 35, boulevard Prince Henri, L-1724 Luxembourg.
Reinet Fund is managed by Reinet Fund Manager S.A. (the ‘Fund
Manager’), a limited company established in Luxembourg (société
anonyme), which also owns 1 000 management shares in Reinet
Fund. The Fund Manager is the general partner in Reinet Fund and
is liable for any obligations of Reinet Fund that cannot be met out
of the assets of Reinet Fund. The Fund Manager’s registered office is
at 35, boulevard Prince Henri, L-1724 Luxembourg.
portfolio of
whom it may co-invest. Reinet Fund is advised by Reinet Investment
Advisors Limited (the ‘Investment Advisor’) under the terms of
the investment advisory agreement (the ‘Investment Advisory
Agreement’).
1.2 SECURITIES LISTINGS AND TRADING
The Company’s ordinary shares are listed and traded on the
Luxembourg Stock Exchange, Euronext Amsterdam and the
Johannesburg Stock Exchange; the listing on the Johannesburg
Stock Exchange is a secondary listing.
1.3 APPROVAL OF THESE FINANCIAL STATEMENTS
These consolidated financial statements have been approved by the
Board of Overseers on 14 May 2024, and by the Board of Directors
of the General Partner on 23 May 2024 for submission to the annual
general meeting of shareholders.
2. INTERNATIONAL FINANCIAL
REPORTING STANDARDS
The Company applies International Financial Reporting Standards
(‘IFRS Accounting Standards’) as endorsed by the European
Union (‘EU’). As part of its ongoing programme, the International
Accounting Standards Board (‘IASB’) has issued new or revised
IFRS Accounting Standards during the period covered by these
financial statements.
(a) New standards and amended standards adopted in the year:
Amendments to IAS 1, Presentation of Financial Statements, became
effective for annual periods beginning on or after 1 January 2023.
It requires entities to disclose their material accounting policy
information rather than their significant accounting policies.
To support this amendment, the IASB also amended IFRS
Practice Statement 2, Making Materiality Judgements, to explain
the application of the materiality concept to accounting policy
disclosures. The Amendments also revise IAS 8, Accounting policies,
Changes in Accounting Estimates and Errors: Definition of Accounting
Estimates, to replace the definition of a change in accounting
estimates with a definition of accounting estimates and provide
other clarifications to help entities distinguish accounting policies
from accounting estimates.
(b) New standards, amendments and interpretations issued but
not effective for the year beginning 1 April 2023 and not
early adopted:
Certain new accounting standards issued by the IASB and new
interpretations issued by the International Financial Reporting
Interpretations Committee are not yet effective and have not been
applied in preparing these consolidated financial statements. None
of these are expected to have a significant effect on the consolidated
financial statements of the Company.
3. SUMMARY OF MATERIAL ACCOUNTING
POLICIES
The principal accounting policies applied in the preparation of these
financial statements in so far as they relate to the Company’s ongoing
activities are set out below. These policies have been consistently
applied to both periods presented, unless otherwise stated.
Where necessary, comparative figures have been adjusted to conform
with changes in presentation in the current year.
3.1 BASIS OF PREPARATION
The financial statements are prepared in accordance with
IFRS Accounting Standards as issued by the IASB and adopted
by the EU. These financial statements have been prepared under
the historical cost convention, as modified by the revaluation of
financial assets and financial liabilities at fair value through profit
or loss.
The preparation of financial statements in conformity with
IFRS Accounting Standards requires the use of certain critical
accounting estimates. It also requires the General Partner to exercise
its judgement in the process of applying the Company’s accounting
policies. The areas involving a higher degree of judgement or
complexity, or areas where assumptions and estimates are significant
to the financial statements are disclosed in note 6.
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
3.2 INVESTMENT ENTITY AND SUBSIDIARIES
3.2.1 Investment entity
The Company adopted IFRS 10, which requires that investment
entities measure their subsidiaries at fair value through profit or loss.
The General Partner considered all the facts and circumstances when
assessing whether the Company qualifies as an investment entity under
IFRS 10, such as, but not limited to, its objective of long-term capital
appreciation (as reflected in the Company’s prospectus, published
on 10 October 2008 as last amended on 25 August 2020), and its
classification of financial assets at fair value through profit or loss.
IFRS 10 determines that an investment entity is defined as an entity
which meets the following conditions:
(a) obtains funds from one or more investors for the purpose
of providing those investor(s) with investment management
services;
(b) commits to its investor(s) that its business purpose is to invest
funds solely for returns from capital appreciation, investment
income, or both; and
(c) measures and evaluates the performance of substantially all of its
investments on a fair value basis.
In assessing whether the Company meets the definition of an
investment entity as set out in IFRS 10, the General Partner
considered whether the Company has the following typical
characteristics, while noting that the absence of any one or more of
these characteristics does not necessarily disqualify an entity from
being classified as an investment entity:
(a) it has more than one investment;
(b) it has more than one investor;
(c) it has investors that are not related parties of the entity; and
(d) it has ownership interests in the form of equity or similar
interests.
The Company has multiple investors and owns the entire ordinary
share capital of Reinet Fund. The Company is exposed to variable
returns from changes in the fair value of Reinet Fund’s net assets.
Although the Company does not have multiple investments, the
General Partner believes that the Company can be classified as
an investment entity due to the fact that it was formed to give its
shareholders exposure to the underlying assets held by Reinet Fund.
In that respect, it is to be noted that an investment entity may
hold a portfolio of investments directly or indirectly, for example
by holding a single investment in another investment entity that
itself holds several investments. The Company’s investments are all
held through Reinet Fund. References to Reinet Fund include all
underlying subsidiaries.
The Fund Manager further deems Reinet Fund to meet the definition
of an investment entity.
Where applicable, the notes to the consolidated financial statements
give information at the level of Reinet Fund and its subsidiaries.
3.2.2 Subsidiaries
Subsidiaries are all entities over which the Company has control.
The Company controls an entity when it is exposed to, or has rights
to, variable returns from its involvement with the entity and has the
ability to affect those returns through its power over the entity.
The Company controls Reinet Fund through its 100 per cent holding
of the ordinary shares of Reinet Fund. The Company and Reinet
Fund operate as an integrated structure whereby the Company
currently invests solely into Reinet Fund. No subscriptions or
redemptions were made during the year. As at 31 March 2024 and
31 March 2023 there were no capital commitment obligations and
no amounts due to Reinet Fund for unsettled purchases.
The change in fair value of Reinet Fund is included in the statement
of comprehensive income in ‘Net change in the fair value of financial
assets at fair value through profit or loss’.
3.3 FOREIGN CURRENCY TRANSLATION
3.3.1 Functional and presentation currency
The performance of the Company is measured and reported to the
investors in euro. The General Partner considers the euro as the
currency which is most appropriate for the representation of the
Company’s results. The financial statements are presented in euro.
The euro is the Company’s functional and presentation currency.
3.3.2 Transactions and balances
Foreign currency transactions are translated into the functional
currency using the exchange rates prevailing at the dates of the
transactions. Foreign currency assets and liabilities are translated
into the functional currency using the exchange rate prevailing at
the balance sheet date.
Where assets and liabilities are denominated in a currency other
than the functional currency of the entity that holds such assets and
liabilities, foreign exchange gains and losses arising from translation
are included in the statement of comprehensive income.
Foreign exchange gains and losses relating to cash and cash
equivalents, if any, are included in the statement of comprehensive
income.
Foreign exchange gains and losses relating to the financial assets
carried at fair value through profit or loss are presented in the
statement of comprehensive income within ‘Net change in the fair
value of financial assets at fair value through profit or loss’.
3.4 SEGMENT REPORTING
The Company’s investment in Reinet Fund is considered to be
its only segment. Segments within Reinet Fund are reported in a
manner consistent with the internal reporting provided by the Fund
Manager in respect of Reinet Fund. The Fund Manager is the chief
operating decision maker and is responsible for allocating resources
and assessing performance of the segments.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
51 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
3.5 NON-IFRS DISCLOSURES
In the reporting of financial information, the Company uses certain
measures that are not required under IFRS Accounting Standards.
Due to the secondary listing of the Company on the Johannesburg
Stock Exchange, the Company is required to present ‘headline’
earnings per share and diluted ‘headline’ earnings per share, as
alternative measures of earnings per share, calculated in accordance
with Circular 1/2023 ‘Headline Earnings’ issued by the South African
Institute of Chartered Accountants. This is presented on page 67.
3.6 FINANCIAL ASSETS AT FAIR VALUE THROUGH
PROFIT OR LOSS
3.6.1 Classification
The Company classifies its investments based on both the
Company’s business model for managing those financial assets and
the contractual cash flow characteristics of the financial assets. The
investment in Reinet Fund is managed and performance is evaluated
on a fair value basis. The Company is primarily focused on fair value
information and uses that information to assess the financial asset’s
performance and to make decisions. Consequently, this investment
is measured at fair value through profit or loss.
Current assets are those which are expected to fall due, be receivable or
realised within 12 months from the balance sheet date. Non-current
assets are those where no realisation is currently expected within a
12-month period from the balance sheet date.
3.6.2 Recognition, derecognition and measurement
Regular purchases and sales of investments are recognised on the
trade date – the date on which the Company commits to purchase
or sell the investment. Financial assets held at fair value through
profit or loss are initially recognised at fair value. Transaction costs
are expensed as incurred in the statement of comprehensive income.
Financial assets are derecognised when the rights to receive cash
flows from the investments have expired or the Company has
transferred substantially all risks and rewards of ownership. Where
the Company is in the process of restructuring the ownership of
an asset, amounts which are to be sold to third parties and where
a signed contract of sale exists, are included as assets held for sale.
Subsequent to initial recognition, financial assets held at fair value
through profit or loss are measured at fair value. Gains and losses
arising from changes in the fair value are presented in the statement
of comprehensive income within ‘Net change in the fair value of
financial assets at fair value through profit or loss’ in the period in
which they arise.
Dividend income from financial assets held at fair value through
profit or loss is recognised in the statement of comprehensive income
when the Company’s right to receive payments is established.
3.6.3 Fair value estimation
The net asset value of Reinet Fund is determined by the Fund Manager.
The Company’s policy requires the Fund Manager to evaluate the
information about Reinet Fund’s financial assets and liabilities on
a fair value basis together with other related financial information.
The General Partner considers the net asset value of Reinet Fund as
determined by the Fund Manager, according to the principles outlined
in the next paragraph, to be the best estimate of fair value.
In calculating the fair value of the assets and liabilities held by Reinet
Fund, the fair value of financial assets traded in active markets (such
as publicly traded securities) is based on quoted market prices at the
balance sheet date. The quoted market price used for financial assets
is the closing bid price. The fair value of financial assets that are
not traded in an active market is determined by the Fund Manager
using valuation techniques in accordance with International
Private Equity and Venture Capital Valuation (‘IPEV’) guidelines
and in compliance with IFRS 13, Fair Value Measurement. The
Fund Manager uses a variety of valuation methods in each case
considered to be most appropriate to the assets concerned. Where
necessary, valuations are obtained by the Fund Manager from third-
party experts to support the valuations being used in the financial
statements.
Valuation techniques used include the use of comparable recent
arm’s-length transactions, reference to other instruments that have
substantially the same characteristics, discounted cash flow analysis,
option pricing models and other valuation techniques commonly
used by market participants making the maximum use of market
inputs and relying as little as possible on entity-specific inputs. For
recent investments in unquoted investments, cost may be considered
to be the best estimate of fair value (in accordance with the most
recent IPEV guidelines and in compliance with IFRS 13), for a
limited period after the date of the transaction and in the absence of
any indications to the contrary.
3.7 CASH AND CASH EQUIVALENTS
Cash and cash equivalents include cash on hand, deposits held at
call with banks, other short-term highly liquid investments with
original maturities of three months or less and bank overdrafts.
3.8 RECEIVABLES
Receivables are recognised initially at fair value and are subsequently
measured at amortised cost less loss allowance.
3.9 ACCRUED EXPENSES
Accrued expenses are recognised initially at fair value and are
subsequently measured at amortised cost less loss allowance.
3.10 TREASURY SHARES
Treasury shares are recorded at acquisition price on the trade date.
Transaction costs are expensed as incurred in the statement of
comprehensive income. A liability is recorded for unpaid amounts
under any ongoing share buyback programme.
3.11 TAXATION
The Company is registered in Luxembourg and is subject to
corporate tax as determined by Luxembourg law.
Reinet Fund may incur withholding taxes imposed by certain
countries on investment income and capital gains. Such tax on
income or gains is recorded within the fair value of the Company’s
investment in Reinet Fund.
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REINET INVESTMENTS S.C.A.
4. FINANCIAL ASSETS HELD AT FAIR VALUE THROUGH PROFIT OR LOSS
31 March 2024
€ m
31 March 2023
€ m
Financial assets held at fair value through profit or loss
– Unlisted investments: Reinet Fund 6 185 5 721
Total financial assets at fair value through profit or loss 6 185 5 721
Net change in the fair value of financial assets at fair value through profit or loss:
– Repayment of capital – (40)
– Unrealised gain/(loss) 464 (171)
Total 464 (211)
The investment held is in Reinet Fund, which is considered to be a related party of the Company. Also refer to note 13 for related party disclosures.
The following table presents the movement of the investments held by Reinet Fund for the year ended 31 March 2024:
Assets held at fair value through profit
or loss
Opening
balance
1April
2023
€ m
Purchases/
(repayments)
€ m
Sale
proceeds
€ m
Realised
gains/
(losses)
in the year
€ m
Movement
in unrealised
gains/
(losses)
in the year
(1)
€ m
Closing
balance
31 March
2024
€ m
Listed investments
British American Tobacco p.l.c. (‘BAT’) 1 561 – – – (202) 1 359
Other listed investments 83 – – – 10 93
Unlisted investments
Pension Insurance Corporation Group
Limited (‘Pension Corporation’)
2 787
–
– –
649 3 436
Trilantic Capital Partners 472 23 (55) 34 (31) 443
TruArc Partners 301 46 (1) 1 25 372
Coatue funds 50 20 – – 3 73
Asian private equity companies and
portfoliofunds 219 4 (11) (18) (23) 171
Specialised investment funds 96 13 (17) – 16 108
United States land development
andmortgages 26 (7) – – 2 21
Other investments 58 17 – (26) 26 75
5 653 116 (84) (9) 475 6 151
Cash and liquid funds 288 356
Other assets and liabilities (220) (322)
Total 5 721 6 185
(1) Unrealised gains/(losses) in the year include accrued interest income from investments.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
53 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
The following table presents the movement of the investments held by Reinet Fund for the year ended 31 March 2023:
Assets held at fair value through profit
or loss
Opening
balance
1April
2022
€ m
Purchases/
(repayments)
€ m
Sale
proceeds
€ m
Realised
gains/
(losses)
in the year
€ m
Movement
in unrealised
gains/
(losses)
in the year
(1)
€ m
Closing
balance
31 March
2023
€ m
Listed investments
BAT 1 832 – – – (271) 1 561
Other listed investments 100 – – – (17) 83
Unlisted investments
Pension Corporation 2 796 6 – – (15) 2 787
Trilantic Capital Partners 385 22 (38) 21 82 472
TruArc Partners 202 66 (3) 1 35 301
Coatue funds – 50 – – – 50
Asian private equity companies and
portfoliofunds 213 22 (9) 2 (9) 219
Specialised investment funds 106 7 (6) 1 (12) 96
United States land development
andmortgages 32 (11) – – 5 26
Diamond interests 20 – (20) (12) 12 –
Other investments 81 5 – – (28) 58
5 767 167 (76) 13 (218) 5 653
Cash and liquid funds 408 288
Other assets and liabilities (243) (220)
Total 5 932 5 721
(1) Unrealised gains/(losses) in the year include accrued interest income from investments.
5. FINANCIAL RISKS
5.1 FINANCIAL RISK FACTORS
The Company has a sole investment in Reinet Fund, therefore the
General Partner of the Company relies on the risk management
procedures performed by the Fund Manager, and thus the risk
management disclosures set out below are at the level of Reinet Fund.
The Company, through its investment in Reinet Fund, is exposed
to a variety of financial risks including market risk (ie currency risk,
fair value interest rate risk, cash flow interest rate risk and price risk),
credit risk and liquidity risk.
The Fund Manager seeks to maximise the returns derived for the
level of risk to which Reinet Fund is exposed and seeks to minimise
potential adverse effects on financial performance. Reinet Fund’s
investment policy allows it to use derivative financial instruments
to both moderate and create certain risk exposures. All investments
present a risk of loss of capital. The management of these risks is
carried out by the Fund Manager.
Reinet Fund will use different methods to measure and manage
the various types of risks to which it is exposed; these methods are
explained on the following pages. There have been no changes in the
methods used in the year under review.
During the year, global markets continued to be impacted by the effects
of the Ukraine crisis, the turmoil in the Middle East, high interest
rates and inflation. Whilst inflation has started to fall, high prices
continue to put significant pressure on households and consumers as
many central banks hold interest rates at current levels to mitigate
the inflation concerns. The extent and impact of these factors remain
uncertain. As a result, higher levels of risk and uncertainty exist at
this time and markets are likely to remain volatile for some time, and
thereby continue to have an influence on the value and prospects of
the investments held by Reinet Fund.
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REINET INVESTMENTS S.C.A.
5.1.1 Market risk
Reinet Fund – Financial assets and liabilities subject to market risk
31 March 2024
Total
€ m
Price risk
€ m
Foreign
exchange
risk
€ m
Interest
rate risk
€ m
Assets
Listed equity securities 1 452 1 452 1 452 –
Unlisted equity securities and funds 4 685 4 685 4 620 –
Loans and interest receivable 14 – 14 14
6 151 6 137 6 086 14
Cash and cash equivalents 356 270 354 –
Other assets 33 – 33 –
Total assets 6 540 6 407 6 473 14
Liabilities
Borrowings (229) – (229) (229)
Other liabilities (126) – (4) –
Total liabilities (355) – (233) (229)
Total investment in Reinet Fund 6 185
31 March 2023
Total
€ m
Price risk
€ m
Foreign
exchange
risk
€ m
Interest
rate risk
€ m
Assets
Listed equity securities 1 644 1 644 1 644 –
Unlisted equity securities and funds 3 990 3 990 3 952 –
Loans and interest receivable 19 – 19 19
5 653 5 634 5 615 19
Cash and cash equivalents 288 234 288 –
Other assets 32 – 32 –
Total assets 5 973 5 868 5 935 19
Liabilities
Borrowings (217) – (217) (217)
Other liabilities (35) – (5) –
Total liabilities (252) – (222) (217)
Total investment in Reinet Fund 5 721
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
55 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
5.1.1.1 Price risk
Reinet Fund is exposed to price risk. This arises from the investments
held by Reinet Fund for which prices in the future are uncertain.
The fair value of listed securities is dependent upon stock exchange
movements which are determined by the market’s expectations
reflecting interest rates, sentiment, volatility, currency and other
factors both specific to each investment and those affecting the market
as a whole. Investments in venture capital and start-up projects will
also tend to have higher price volatility than more mature investments.
Where non-monetary financial instruments are denominated in
currencies other than the euro, the price initially expressed in foreign
currency and then converted into euro will also fluctuate because of
changes in foreign exchange rates. Note 5.1.1.2 ‘Foreign exchange risk’
sets out how this component of price risk is managed and measured.
Reinet Fund’s policy is to manage price risk through the diversification
and selection of securities and other financial instruments. It is
expected that this diversification policy will be implemented on a
measured basis, over a period of time.
Reinet Fund’s exposure to price risk in respect of long-term assets and liabilities was as follows:
31 March 2024
€ m
31 March 2023
€ m
Listed equity securities
– BAT 1 359 1 561
– Other listed investments 93 83
Unlisted equity securities and funds
– Pension Corporation 3 436 2 787
– Others
1 249 1 203
Total exposure to price risk 6 137 5 634
During the years ended 31 March 2024 and 31 March 2023, Reinet Fund’s exposure to various industry sectors was principally in respect of
its indirect investments held in BAT and Pension Corporation. This represented some 78 per cent of the net asset value of Reinet Fund as at
31March 2024 (31 March 2023: 76 per cent).
The table below summarises the sensitivity of Reinet Fund’s assets to price movements as at 31 March 2024 and 31 March 2023.
The analysis is based on the assumption that prices would increase or decrease by 20 per cent with all other variables held constant. The change
is based on a reasonable possible change in the fair value of the investments held as at year-end.
31 March 2024
€ m
31 March 2023
€ m
Effect of a 20 per cent increase in prices
Effect on equity securities and funds 1 227 1 127
Effect on net assets 1 227 1 127
Effect of a 20 per cent decrease in prices
Effect on equity securities and funds (1 227) (1 127)
Effect on net assets (1 227) (1 127)
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REINET INVESTMENTS S.C.A.
5.1.1.2 Foreign exchange risk
Reinet Fund operates internationally and holds both monetary
and non-monetary assets denominated in currencies other than
the euro, primarily the US dollar, sterling and South African rand.
Foreign currency risk, as defined in IFRS 7, arises as the value of
future transactions, recognised monetary assets and monetary
liabilities denominated in other currencies fluctuate due to changes
in foreign exchange rates. IFRS 7 considers the foreign exchange
exposure relating to non-monetary assets and liabilities to be a
component of market price risk not foreign currency risk. The Fund
Manager, however, monitors the exposure on all foreign currency
denominated assets and liabilities, and hence, the table below has
been analysed between monetary and non-monetary items to meet
the requirements of IFRS 7.
Reinet Fund’s policy is currently to minimise its exposure to
monetary foreign exchange movements on liquid funds by holding
such liquid funds in euro, US dollar and sterling where there
are corresponding US dollar and sterling liabilities. That policy
may change to reflect the Fund Manager’s view as to the likely
development of foreign exchange rates in the medium-term or to
take account of requirements for funds for investment purposes in
currencies other than the euro. Where appropriate, Reinet Fund
may enter into foreign exchange hedging transactions. The exposure
to sterling has been partially hedged by borrowings in this currency.
When the Fund Manager formulates a view on the future direction
of foreign exchange rates and the potential impact on Reinet Fund,
the Fund Manager factors that into its resource allocation decisions.
While Reinet Fund may have direct exposure to foreign exchange rate
changes on the price of non-euro denominated securities, it may also
be indirectly affected by the impact of foreign exchange rate changes
on the earnings of certain companies in which it invests, most notably
BAT and Pension Corporation. For that reason, the sensitivity analysis
will not necessarily indicate the total effect on Reinet Fund’s net assets
of future movements in foreign exchange rates.
Reinet Fund has certain investments in foreign operations, whose
net assets are exposed to foreign currency translation risk. Where
appropriate, borrowings in foreign currencies may be used as a
natural hedge of foreign currency assets. Currency exposure arising
from the net assets of the foreign operations is managed where
considered necessary through borrowings denominated in the
relevant foreign currencies.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
57 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
The table below summarises Reinet Fund’s assets and liabilities by currency as at 31 March 2024:
Concentration of assets and liabilities
by currency
GBP USD ZAR EUR Total
€ m £ m € m $ m € m R m € m € m
Assets
Monetary assets
Cash and liquid funds 178 152 176 190 – – 2 356
Non-monetary assets
BAT 1 359 1 162 – – – – – 1 359
Other listed investments – – 93 100 – – – 93
Pension Corporation 3 436 2 938 – – – – – 3 436
Trilantic Capital Partners – – 399 431 – – 44 443
TruArc Partners – – 372 402 – – – 372
Coatue funds – – 73 79 – – – 73
Asia private equity companies and
portfolio funds – – 171 185 – – – 171
Specialised investment funds 1 – 107 116 – 6 – 108
United States land development
and mortgages – – 21 23 – – – 21
Other investments 1 1 54 58 – – 20 75
Other assets 33 28 – – – – – 33
Total assets 5 008 4 281 1 466 1 584 – 6 66 6 540
Percentage of total assets 76.6% 22.4% – 1.0% 100%
Liabilities
Monetary liabilities
Borrowings (229) (196) – – – – – (229)
Non-monetary liabilities
Fees payable, other liabilities and minority
interest – – (4) (5) – – (122) (126)
Total liabilities (229) (196) (4) (5) – – (122) (355)
Percentage of total liabilities 64.5% 1.1% – 34.4% 100%
Reinet Fund NAV 4 779 1 462 – (56) 6 185
Percentage of NAV 77.3% 23.6% – (0.9)% 100%
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
The table below summarises Reinet Fund’s assets and liabilities by currency as at 31 March 2023:
Concentration of assets and liabilities
by currency
GBP USD ZAR EUR Total
€ m £ m € m $ m € m R m € m € m
Assets
Monetary assets
Cash and liquid funds 144 126 144 156 – – – 288
Non-monetary assets
BAT 1 561 1 372 – – – – – 1 561
Other listed investments – – 83 90 – – – 83
Pension Corporation 2 787 2 450 – – – – – 2 787
Trilantic Capital Partners – – 436 473 – – 36 472
TruArc Partners – – 301 327 – – – 301
Coatue funds – – 50 54 – – – 50
Asia private equity companies and
portfolio funds – – 219 237 – – – 219
Specialised investment funds 1 1 93 101 – 6 2 96
United States land development
and mortgages – – 26 28 – – – 26
Other investments 6 6 52 56 – – – 58
Other assets 32 28 – – – – – 32
Total assets 4 531 3 983 1 404 1 522 – 6 38 5 973
Percentage of total assets 75.9% 23.5% – 0.6% 100%
Liabilities
Monetary liabilities
Borrowings (217) (190) – – – – – (217)
Non-monetary liabilities
Fees payable, other liabilities and minority
interest – – (5) (5) – – (30) (35)
Total liabilities (217) (190) (5) (5) – – (30) (252)
Percentage of total liabilities 86.1% 2.0% – 11.9% 100%
Reinet Fund NAV 4 314 1 399 – 8 5 721
Percentage of NAV 75.4% 24.5% – 0.1% 100%
Changes in value due to movement in foreign
rates, applying the March 2024 foreign exchange
rates to the March 2023 assets and liabilities 123 6 – – 129
Management of the Fund Manager monitors Reinet Fund’s foreign exchange exposure in respect of monetary assets on a weekly basis and the
Board of Directors of the Fund Manager reviews it at each meeting.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
59 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
The table below summarises the sensitivity of Reinet Fund’s assets and liabilities to changes in foreign exchange movements at year-end in
absolute terms. The analysis is based on the assumption that the relevant foreign exchange rate increased/decreased by 10 per cent to the euro,
with all other variables held constant. This increase or decrease in the net assets attributable to shareholders arises mainly from a change in the
fair value of UK equities, notably the investments held in BAT and Pension Corporation, and other investments denominated in US dollar that
are classified as financial assets held at fair value through profit or loss.
Movement in each currency against euro
31 March 2024
Increase or decrease
€ m
31 March 2023
Increase or decrease
€ m
Sterling
Monetary 5 7
Non-monetary 483 439
US dollar
Monetary 18 14
Non-monetary 129 126
Applying current year exchange rates to the 31 March 2023 assets
and liabilities would have resulted in an increase in value of some
€129 million, due to the strengthening of sterling and the US dollar.
5.1.1.3 Interest rate risk
Interest rate risk arises from the effects of fluctuations in the
prevailing levels of market interest rates on the fair value of financial
assets and liabilities and future cash flows. Reinet Fund holds fixed
interest loans and has long-term borrowings that expose it to fair
value interest rate risk.
As at 31 March 2024, Reinet Fund held financial assets with fixed
interest rates amounting to € 14 million (31 March 2023: € 19 million).
There were no financial assets with variable interest rates held as at
31March 2024 and 31 March 2023.
Borrowings at variable rates expose Reinet Fund to cash flow interest
rate risk, this is partly offset by cash and financial assets held at
variable rates. There were no borrowings outstanding at variable
rates at 31 March 2024 and 31 March 2023.
Changes in interest rates affect the fair value of fixed interest
financial assets and liabilities. A change in interest rates of 100
basis points would increase/decrease the fair value by € 2 million at
31March2024 (31 March 2023: € 4 million).
Reinet Fund may also be indirectly affected by the impact of interest
rate changes on the earnings of its investments and the impact on
the investment valuations that use interest rates as an input in the
valuation model. The sensitivity analysis may not indicate the total
effect on the movement in these interest rates.
The Fund Manager monitors Reinet Fund’s overall interest rate
sensitivity on a regular basis.
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REINET INVESTMENTS S.C.A.
5.1.2 Credit risk
Reinet Fund is exposed to credit risk, which is the risk that a counterparty will be unable to pay amounts in full when they fall due.
The main credit risk to which Reinet Fund is exposed arises from bank deposits, bonds, loans to third parties and borrowings where Reinet Fund’s
assets are pledged in favour of a third-party. Reinet Fund is also exposed to counterparty credit risk on other receivable balances.
Reinet Fund measures credit risk and expected credit losses using probability of default, exposure at default and loss given default. Management
considers both historical analysis and forward-looking information in determining any expected credit loss.
Reinet Fund’s policy to manage this risk is to place funds only with banks which have strong credit ratings.
The analysis below summarises the credit quality of Reinet Fund’s cash and liquid funds.
31 March 2024 31 March 2023
Banks by rating category (Moody’s) € m % € m %
Aaa 270 76 234 81
Aa3 27 8 19 7
A1 13 3 1 –
A2 – – 14 5
A3 46 13 20 7
Total 356 100 288 100
In addition, Reinet Fund has the following investments and receivables that are exposed to credit risk:
31 March 2024 31 March 2023
€ m % € m %
Loans to private equity interests at fair value 14 100 19 100
Total 14 100 19 100
Investments in loans are reviewed periodically and revalued where
necessary. The loans are neither rated nor listed.
All transactions in listed securities are settled/paid for upon delivery
using approved brokers. The risk of default is considered minimal, as
delivery of securities sold is only made once the broker has received
payment. Payment is made on a purchase once the securities have
been received by the broker. The trade will fail if either party fails to
meet its obligation.
5.1.3 Liquidity risk
Liquidity risk is the risk that Reinet Fund may not be able to generate
sufficient cash resources to settle its obligations in full as they fall
due or can only do so on terms that are materially disadvantageous.
The Fund Manager monitors Reinet Fund’s liquidity position on a
daily basis.
During the year under review, Reinet Fund obtained a fixed-rate
£100million margin loan from Citibank N.A. The loan is repayable
in August 2024.
In addition, Reinet Fund obtained a fixed-rate £ 100 million
margin loan from Bank of America, N.A. The loan is repayable in
March2025.
Some 15 million BAT shares have been pledged to collateralise these
two loans.
Reinet Fund has a facility agreement in place with Citibank
N.A. up to 19 August 2024 and with Bank of America, N.A.
up to 21 March 2025. The borrowing facilities allow Reinet to
drawdown the equivalent of up to € 234 million (£ 200 million)
in a combination of currencies to fund further investment
commitments. As at 31March 2024, Reinet Fund has not drawn
any amount under these facilities.
As at 31 March 2024, 76 per cent of the net asset value of Reinet
Fund’s invested assets are not actively traded on a stock exchange.
Reinet Fund’s listed investment in BAT is considered readily
realisable as its shares are traded with significant daily volumes on
the London Stock Exchange.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
61 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
The table below shows the contractual undiscounted cash flows in respect of borrowings and interest thereon.
Payments due at 31 March 2024
31 March 2024
€ m
31 March 2025
€ m
Borrowings GBP 200 million – 229
Payments due at 31 March 2023
Borrowings GBP 200 million – 217
cred5.2 CAPITAL RISK MANAGEMENT
The Company’s principal objective when managing capital is to
safeguard its ability to continue as a going concern in order to
provide returns for shareholders and benefits for other stakeholders
and to maintain a strong capital base to support the development of
its investment activities.
Capital is comprised of share capital, share premium, non-
distributable reserves, retained earnings and treasury shares as
applicable.
Reinet Fund is not subject to any externally imposed capital
requirements other than any minimum capital requirement imposed
by applicable laws and regulations (currently a minimum capital of
€ 1 250 000 is required by law).
During the year, Reinet Fund complied with the above requirement
and reported a net asset value of € 6 185 million as at 31 March2024
(31 March 2023: € 5 721 million).
During the year under review, a dividend of some € 55 million
(31March 2023: € 51 million) was paid to shareholders. There were
no shares repurchased during the year (31 March 2023: 2.3 million
shares for a cost of € 45 million). There have been no other changes
in capital in the year other than profits generated in the ordinary
course of business.
5.3 FAIR VALUE ESTIMATION
The Company and Reinet Fund have established a control
framework with respect to the measurement of fair values. This
includes a valuation role that is responsible for co-ordinating all
significant fair value measurements, including level 3 fair values, and
reports directly to the Chief Financial Officer (‘CFO’).
Where necessary, independent external valuation experts may
be engaged to assist in the assessment of the fair value of those
investments where market observable data is limited. A review is
carried out on a quarterly basis of all fair values based on latest
available financial information. The CFO reviews significant
unobservable inputs and valuation adjustments.
Consideration is also given to the classification of each investment
into the fair value hierarchy to reflect the level of judgement involved
in estimating fair values. Where a transfer between levels is required
in the reporting period, the transfer is deemed to have occurred at
the beginning of the reporting period.
All investment valuations, including significant valuation issues are
reported to the Board of Overseers and the Board of Directors of the
Fund Manager and General Partner on a quarterly basis.
In accordance with IFRS 13 the Company classifies fair value
measurements using a fair value hierarchy that reflects the
significance of the inputs used in making the measurements. The
fair value hierarchy has the following levels:
• Quoted prices (unadjusted) in active markets for identical assets
(level 1);
• Inputs other than quoted prices included within level 1 that are
observable for the asset, either directly (ie as prices) or indirectly
(ie derived from prices) (level 2); and
• Inputs for the assets that are not based on observable market
data (ie unobservable inputs) (level 3).
The level in the fair value hierarchy within which the fair value
measurement is categorised in its entirety is determined on the
basis of the lowest level input that is significant to the fair value
measurement in its entirety. For this purpose, the significance of an
input is assessed against the fair value measurement in its entirety. If a
fair value measurement uses observable inputs that require significant
adjustment based on unobservable inputs, that measurement is a
level 3 measurement. Assessing the significance of a particular input
to the fair value measurement in its entirety requires judgement,
considering factors specific to the asset or liability.
The determination of what constitutes ‘observable’ requires
significant judgement. The Company considers observable data to be
market data that is readily available, regularly distributed or updated,
reliable and verifiable, not proprietary, and provided by independent
sources that are actively involved in the relevant market.
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REINET INVESTMENTS S.C.A.
The following table analyses, within the fair value hierarchy, the Company’s financial assets and liabilities measured at fair value at 31 March 2024
and 31 March 2023:
31 March 2024
Level 1
€ m
Level 2
€ m
Level 3
€ m
Total
€ m
Assets
Financial assets designated at fair value through profit or loss:
– Investment in Reinet Fund – – 6 185 6 185
Total – – 6 185 6 185
31 March 2023
Assets
Financial assets designated at fair value through profit or loss:
– Investment in Reinet Fund – – 5 721 5 721
Total – – 5 721 5 721
The Company had no transfers between level 2 and level 3 during the year.
The following table presents the movement in level 3 investments for the Company for the years ended 31 March 2024 and 31 March 2023:
31 March 2024
€ m
31 March 2023
€ m
Opening balance 5 721 5 932
Distribution of capital – (40)
Gain/(loss) for the year 464 (171)
Closing balance 6 185 5 721
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
63 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
The following tables analyse, within the fair value hierarchy, Reinet Fund’s financial assets and liabilities measured at fair value:
31 March 2024
Level 1
€ m
Level 2
€ m
Level 3
€ m
Total
€ m
Assets
Financial assets designated at fair value through profit or loss:
– Equity securities and funds 1 452 122 4 563 6 137
– Loans – – 14 14
Total 1 452 122 4 577 6 151
Liabilities
Borrowings – (229) – (229)
Total – (229) – (229)
Net 5 922
Other assets/(liabilities) 263
Reinet Fund net asset value 6 185
31 March 2023
Level 1
€ m
Level 2
€ m
Level 3
€ m
Total
€ m
Assets
Financial assets designated at fair value through profit or loss:
– Equity securities and funds 1 644 141 3 849 5 634
– Loans – – 19 19
Total 1 644 141 3 868 5 653
Liabilities
Borrowings – (217) – (217)
Total – (217) – (217)
Net 5 436
Other assets/(liabilities) 285
Reinet Fund net asset value 5 721
Investments whose values are based on quoted market prices in active
markets, and therefore classified within level 1, include active listed
equities. Reinet Fund does not adjust the quoted price for these
instruments.
Financial instruments that trade in markets that are not considered
to be active but are valued based on quoted market prices, dealer
quotations or alternative pricing sources supported by observable
inputs, as well as open-ended funds are classified within level 2. As
level 2 investments include positions that are not traded in active
markets and/or are subject to transfer restrictions, valuations may be
adjusted to reflect illiquidity and/or non-transferability, which are
generally based on available market information.
Investments classified within level 3 have significant unobservable
inputs, as they trade infrequently. Level 3 instruments include the
Company’s investment in Reinet Fund, which in turn includes
investments in unlisted equities, private equity funds and loans.
As observable prices are not available for these investments, Reinet
Fund has used fair values obtained from audited and unaudited
financial statements provided by fund managers, valuations obtained
from third-party experts using appropriate valuation methods, and
discounted cash flow analyses to derive fair values.
As noted in 5.1.1.1 Reinet Fund holds shares in BAT, these shares
are listed on the London and Johannesburg Stock Exchanges and
movements in the share price could have a significant effect on the
value of Reinet Fund.
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REINET INVESTMENTS S.C.A.
Sensitivity of level 3 investments
Level 3 valuations are reviewed on a regular basis by the Board
of Overseers, who consider the appropriateness of the valuation
models used, as well as the results using various valuation techniques
generally recognised as standard within the fund industry.
Unobservable inputs and the resulting estimated fair values are based
on the best information available at each reporting date. Changes
in fair values due to updated inputs and new information will be
recorded in the period in which they occur. Given the nature of
the investments and their underlying risks and uncertainties there
is a wide range of potential outcomes in respect of these estimated
fair values which may vary significantly from the fair value figures
presented.
The table below summarises for each of Reinet Fund’s significant
level 3 investments the valuation methodology used and any
significant unobservable inputs used in calculating the value of the
investment as at 31 March 2024. The table is not intended to be
all-inclusive, but rather provides information which Reinet Fund
regards as significant in respect of unobservable inputs and their
sensitivity to reasonable change.
Unlisted investments
Fair value at
31 March
2024
€ m
Primary valuation
technique
Unobservable
inputs
Range
(weighted
average)
Reasonable
possible
change +/-
(absolute
value)
(1)
€ m
Pension Corporation 3 436
Market comparable
companies
(2)
Market multiples 0.94 – 1.15
(1.05)
-360/+327
Discount 5% – 15%
(10%)
+191/-191
Trilantic Capital Partners 443 Net asset value
(3)
n/a n/a n/a
TruArc Partners 372 Net asset value
(3)
n/a n/a n/a
Coatue funds 73 Net asset value
(3)
n/a n/a n/a
Asian private equity companies and
portfolio funds 49 Net asset value
(3)
n/a n/a n/a
Specialised investment funds 97 Net asset value
(3)
n/a n/a n/a
11 Recent financing round Discount n/a Not significant
United States land development
and mortgages
21 Discounted cash flow
(4)
Discount rate 10% – 30% +2/-1
(14.2%)
Other investments 15 Net asset value
(3)
n/a n/a n/a
40 Recent financing round Discount n/a Not significant
20 Recent financing round n/a n/a n/a
Total 4 577
(1) The reasonable possible change is calculated based on the range of unobservable inputs indicated in the table and is only an indication of the sensitivity of such inputs. A larger change in value
could arise as a result of other factors which may occur after the reporting date.
(2) The market multiples for the peer group were considered and used as a basis in calculating the estimated fair value of the investment; a movement of 10 per cent has been applied for calculating
the reasonable possible change for this factor, as this is deemed as a reasonable market movement by management. A discount of 10 per cent was applied to recognise in part the lack of
liquidity in the unlisted shares; a movement of 5 per cent has been applied for calculating the reasonable possible change for this factor, as this is deemed as a reasonable market movement by
management. This investment has also been reviewed by a third-party valuation expert.
(3) Reinet Fund has relied upon the latest available net asset value data provided by investment/fund managers, adjusted for changes in the value of listed investments included in the portfolios
and cash movements up to 31 March 2024, as applicable. No sensitivity analysis has been performed on the underlying data as no significant unobservable input has been identified at the
level of Reinet Fund.
(4) Included in this investment are US land lots and properties which have been valued at 31 December 2023 on a discounted cash flow approach. Mortgage loans receivable and mortgages
payable have been valued using a discounted cash flow approach. Discount rates in the range of 10 per cent to 30 per cent have been applied in determining the fair values of the mortgages
based on the level of risk and estimated timing of repayment. Changes in land values would also affect the value of the investment.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
65 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
6. CRITICAL ACCOUNTING ESTIMATES
AND JUDGEMENTS
6.1 CRITICAL ACCOUNTING ESTIMATES AND
ASSUMPTIONS
The General Partner must make estimates and assumptions
concerning the future. The resulting accounting estimates will, by
definition, seldom equal the related actual results. The estimates
and assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within
the next financial year are addressed below.
Fair value of unquoted investments
The Company holds an investment in Reinet Fund. The value
of Reinet Fund is determined by the Fund Manager who applies
various valuation techniques in valuing the underlying assets. The
General Partner considers the net asset value of Reinet Fund as
determined by the Fund Manager to be the fair value.
The fair value of investments not quoted in an active market may be
determined by the Fund Manager using reputable pricing sources
(such as pricing agencies) or indicative prices from bond/debt
market makers. Broker quotes as obtained from the pricing sources
may be indicative and not executable or binding. The Fund
Manager exercises judgement and estimates on the quantity and
quality of pricing sources used. Where no market data is available,
the Fund Manager may value positions using its own models, which
are based on valuation methods and techniques generally recognised
as standard within the industry. The inputs into these models
are primarily earnings multiples and discounted cash flows. The
models used to determine fair values are validated and periodically
reviewed by personnel independent of the party that created them.
The models used for private equity securities are based mainly on
earnings multiples, adjusted for lack of marketability and control
premiums. The models used for debt securities are based on the net
present value of estimated future cash flows, adjusted as appropriate
for liquidity, and credit and market risk factors.
Models use observable data to the extent practicable. However,
areas such as credit risk (both own and counterparty), volatilities
and correlations require management to make estimates. Changes in
assumptions about these factors could affect the reported fair value
of financial instruments.
The determination of what constitutes ‘observable’ requires
significant judgement by the Fund Manager. The Fund Manager
considers observable data to be market data that is readily available,
regularly distributed or updated, reliable and verifiable, not
proprietary, and provided by independent sources that are actively
involved in the relevant market.
Taxation
Subsidiaries of Reinet Fund are subject to income taxes in several
jurisdictions. Judgement is required in determining the worldwide
provision for income taxes. There are transactions and calculations
for which the ultimate tax determination is uncertain. Reinet Fund
recognises liabilities for anticipated tax payments using estimates
of the amount of taxes due. Where the final outcome is different
from the amounts that were initially recorded, such differences will
impact the current and deferred income tax assets and liabilities in
the period in which such determination is made.
6.2 CRITICAL JUDGEMENTS
Functional currency
The General Partner considers the euro to be the currency that
most appropriately represents the economic effect of the underlying
transactions, events and conditions. The euro is the currency in
which Reinet Fund measures its performance and reports its results.
Investment entity
The Company has multiple investors and owns the entire ordinary
share capital of Reinet Fund. The Company is exposed to variable
returns from changes in the fair value of Reinet Fund’s net assets.
Although the Company does not have multiple investments, the
General Partner believes that the Company can be classified as
an investment entity due to the fact that it was formed to give its
shareholders exposure to the underlying assets held by Reinet Fund.
In that respect it is to be noted that an investment entity may hold
a portfolio of investments directly or indirectly, for example by
holding a single investment in another investment entity that itself
holds several investments. The Company’s investments are all held
through Reinet Fund.
The Fund Manager further deems Reinet Fund to meet the definition
of an investment entity.
7. SEGMENT INFORMATION
Due to the Company’s sole investment in Reinet Fund, the General
Partner of the Company relies on the segment analysis performed
by the Fund Manager.
The Fund Manager makes the strategic resource allocations on behalf
of Reinet Fund according to its investment portfolio as disclosed in
note 4.
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8. SHARE CAPITAL
Ordinary share capital
31 March 2024
€ m
31 March 2023
€ m
Issued capital
195 941 286 (31 March 2023: 195 941 286) ordinary shares issued, fully paid with no par value 220 220
The ordinary shares (excluding the treasury shares, the voting and
dividend rights attached to which are suspended) confer on the
shareholder the entitlement to participate in and to vote at meetings
of shareholders, with each share carrying the right to one vote
as well as the entitlement to receive a proportionate share of any
dividend that the Company may declare. Each share also entitles
each shareholder to receive a proportionate share of the net assets of
the Company on liquidation. The liability of shareholders is limited
to the amount of their investment in the Company.
The relevant movements in the capital are shown on the statement
of changes in equity.
The ordinary shares are listed and traded on the Luxembourg Stock
Exchange, on Euronext Amsterdam and on the Johannesburg Stock
Exchange; the listing on the Johannesburg Stock Exchange is a
secondary listing.
Management share capital
31 March 2024
€ 000’s
31 March 2023
€ 000’s
Issued capital
1 000 (31 March 2023: 1 000) management shares issued, fully paid with no par value 1 1
The management shares are held by the General Partner and confer
the same rights with regard to voting, dividends and the distribution
of assets on liquidation as the ordinary shares. In addition, as the
holder of management shares, the General Partner has broad
powers to manage the Company and has unlimited liability for any
obligations of the Company that cannot be met from the assets of
the Company.
Treasury shares
All ordinary shares repurchased are held as treasury shares and are
recorded at cost, being the price paid on the acquisition date.
On 19 November 2018, the Company announced the
commencement of a share buyback programme in respect of
a maximum of 3.2 million ordinary shares for an aggregate
maximum amount of € 55 million. The programme ran from
20November2018 to 30 January 2019 when 3 200 000 ordinary
shares were repurchased for a cost of € 42 million, plus transaction
costs.
On 6 February 2019, the Company announced the commencement
of a second share buyback programme in respect of a maximum
of 5 million ordinary shares for an aggregate maximum amount
of € 75 million. The programme ran from 11 February 2019 to
31May 2019 when 3 449 689 ordinary shares were repurchased for
a cost of € 50 million, plus transaction costs.
On 14 June 2019, the Company announced the commencement
of a third share buyback programme in respect of a maximum of
2.75 million ordinary shares for an aggregate maximum amount
of € 44 million. The programme ran from 19 June 2019 to
23August2019 when 2 047 348 ordinary shares were repurchased
for a cost of € 31 million, plus transaction costs.
On 6 September 2019, the Company announced the commencement
of a fourth share buyback programme in respect of a maximum of
3.1 million ordinary shares for an aggregate maximum amount
of € 50 million. The programme ran from 11 September 2019
to 27 November 2019 when 2 954 358 ordinary shares were
repurchased for a cost of € 50 million, plus transaction costs.
On 24 March 2022, the Company announced the commencement
of a fifth share buyback programme in respect of a maximum of
2.5 million ordinary shares for an aggregate maximum amount
of € 50 million. The programme ran from 28 March 2022 to
23May2022 when 2 500 000 ordinary shares were repurchased for
a cost of € 49 million, plus transaction costs.
All ordinary shares repurchased are held as treasury shares.
As at 31 March 2024, there was no share buyback programme in
progress.
Number of shares Cost € m
Repurchased shares
1
st
buyback programme 3 200 000 42
2
nd
buyback programme 3 449 689 50
3
rd
buyback programme 2 047 348 31
4
th
buyback programme 2 954 358 50
5
th
buyback programme 2 500 000 49
Total treasury shares held as at 31 March 2024 14 151 395 222
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
67 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
9. NON-DISTRIBUTABLE RESERVE
The legal reserve amounting to € 22 million at 31 March 2024 and 31 March 2023 is not available for distribution.
10. AMOUNTS OWED TO AFFILIATED UNDERTAKINGS
The amount payable includes the fee payable to the General Partner of € 1.1 million and € nil due to Reinet Fund at 31 March 2024 (31 March
2023: € 0.8 million and € 0.7 million). The amounts owed to affiliated undertakings are measured at amortised cost less loss allowance, with the
carrying amount approximating fair value at 31 March 2024.
11. TAX EXPENSE
Under the current laws of Luxembourg, the Company pays corporation tax on profits at rates enacted in Luxembourg. The General Partner does
not expect significant taxes to be payable for the current year or in the near future, due to the structure of the Company, dividends declared by
the Company being tax deductible, and given that the Company has assessed operating losses available to it at the year-end.
12. EARNINGS PER SHARE
Basic earnings per share is calculated by dividing the profit/(loss) for the year attributable to the shareholders by the weighted average number
of shares in issue during the year.
31 March 2024 31 March 2023
€ millions
Profit/(loss) for the year 519 (120)
Millions of shares
Shares outstanding at beginning of year (excluding treasury shares) 181.8 184.1
Effect of repurchased shares in the year – (2.1)
Weighted average number of ordinary shares in issue 181.8 182.0
€ per share
Earnings per share from profit/(loss) for the year – basic and diluted 2.85 (0.66 )
The Company has not issued any shares or other instruments that are considered to have dilutive potential. There were no movements in the
year ended 31 March 2024.
The presentation of headline earnings per share, as an alternative measure of earnings per share, is mandated under the JSE Listings Requirements.
It is calculated in accordance with Circular 1/2023 ‘Headline Earnings’, as issued by the South African Institute of Chartered Accountants.
Headline earnings per share
31 March 2024
€ per share
31 March 2023
€ per share
Unadjusted earnings per share 2.85 (0.66)
Headline earnings per share 2.85 (0.66)
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REINET INVESTMENTS S.C.A.
13. RELATED PARTY TRANSACTIONS
The Company has a number of relationships and transactions with
related parties, as defined in IAS 24, Related party transactions, all of
which have been conducted on an arm’s-length basis and on normal
market terms.
All related parties are categorised as ‘other related parties’ under
IAS24, except for the Boards of Directors of the General Partner
and the Fund Manager, which is categorised as ‘key management
personnel’.
Parties identified as related parties are:
COMPAGNIE FINANCIÈRE RICHEMONT SA
(‘CFR SA’)
The Company has identified CFR SA, a public company
incorporated in Switzerland, as a related party.
Although the management of the Company is distinct from
CFRSA, Mr Rupert is also the Chairman of CFR SA.
THE ANTON RUPERT TRUST, THE ANTON
RUPERT DESCENDANTS TRUST AND AFFILIATED
PARTIES
The Anton Rupert Trust, the Anton Rupert Descendants Trust
and affiliated parties hold some 48.8 million Company shares
representing 24.93 per cent of the Company’s issued share capital.
The group of parties regarded as being affiliated to the Anton
Rupert Trust and the Anton Rupert Descendants Trust includes
entities and persons which are not necessarily closely connected
with persons discharging managerial responsibilities within the
Company, as defined in Article 3 paragraph 1 of the EU Regulation
No 596/2014 on Market Abuse (the ‘Market Abuse Regulation’).
As a consequence, share dealings by such entities or persons are not
disclosed as dealings by connected parties in terms of the Market
Abuse Regulation.
THE GENERAL PARTNER
The Company is a partnership limited by shares (société en
commandite par actions) which is managed by the General Partner.
The Company reimburses the General Partner for its expenses
incurred in the ordinary course of business, including but not
limited to the remuneration of its staff, costs attributable to its
directors’ remuneration, taxes, rentals and any other disbursements,
and pays an annual administration fee equal to 10 per cent of such
expenses.
The General Partner is controlled by Rupert family interests.
THE FUND MANAGER
The Company’s wholly-owned subsidiary, Reinet Fund, is managed
by the Fund Manager. Reinet Fund reimburses the Fund Manager
for its expenses incurred in the ordinary course of business,
including but not limited to the remuneration of its staff, costs
attributable to its directors’ remuneration, taxes, rentals and any
other disbursements, and pays an annual administration fee equal
to 10 per cent of such expenses. Any such amounts payable to the
Fund Manager are deductible from any management fees payable to
the Investment Advisor.
The Fund Manager is controlled by Rupert family interests.
THE INVESTMENT ADVISOR
The Investment Advisor owns 863 581 shares of the Company as at
31 March 2024 (31 March 2023: 916 512).
Under the terms of the Investment Advisory Agreement dated
9October 2008, as amended on 24 May 2010, 10 November 2011,
7 December 2018 and 1 October 2020, between Reinet Fund and
the Investment Advisor, Reinet Fund pays both management fees
and performance fees to the Investment Advisor.
The management fee is payable to the Investment Advisor at a rate
of 1 per cent per annum on the net asset value of Reinet Fund,
excluding cash and interests in funds managed by third parties. It is
calculated semi-annually based on the closing net asset value at the
end of the previous six-month period.
The management fee in respect of cash is calculated at a rate of
one-quarter of 1 per cent per annum. No management fee is payable
in respect of funds managed by third parties except where the fee
payable to the third-party has been negotiated to a level below
1percent per annum and below the level payable by other investors
in a fund. In such circumstances, the difference between the fee
payable to the third-party manager and 1 per cent is payable to the
Investment Advisor.
Investments as a limited partner in funds under the management of
a management company in which Reinet Fund is an investor are not
treated as being managed by third parties; the management fee is
payable at 1 per cent per annum to the Investment Advisor. However,
such a fee payable to the Investment Advisor is reduced by any
management fee paid by Reinet Fund to the management company,
net of income received by Reinet Fund on its investment in the
management company in terms of its share of the management fees
earned by (but not carried interest attributable to) the management
company.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
69 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
Management fee
31 March 2024
€ m
31 March 2023
€ m
Investment Advisor 37 39
Fund Manager 11 10
Total management fee 48 49
The performance fee in any period is calculated as 10 per cent of the Cumulative Total Shareholder Return at the end of the Performance
Measurement Period (both terms being defined in the Company’s prospectus, published on 10 October 2008 as amended on 25 August 2020)
(refer to page 33), adjusted for all dividends and returns of capital to the Company shareholders, less the sum of all performance fees paid in
previous Performance Measurement Periods.
A provision of € 90 million has been made in respect of a performance fee as at 31 March 2024 (31 March 2023: € nil) as the conditions required
to pay a fee had been met at year end date. In order for a performance fee to be payable at 31 March 2024, the volume weighted average market
price of the Company’s share determined by taking into account volume and price information on the Luxembourg Stock Exchange, Euronext
Amsterdam and the Johannesburg Stock Exchange over the last 20 trading days of the current financial year had to exceed € 18.33. The determined
volume weighted average market price of the Company’s share was € 22.93 for the last 20 trading days of the current financial year.
BOARDS OF THE GENERAL PARTNER AND THE FUND MANAGER
Members of the Boards of Directors of the General Partner and the Fund Manager are considered to be related parties. Details of the Boards of
Directors are set out in the corporate governance report on pages 29 and 30 of this annual report.
Aggregate shareholdings of directors of the General Partner and the Fund Manager (excluding Mr Rupert, see page 68).
31 March 2023
Acquired
during the year
Sold/disposed
during the year 31 March 2024
Number of shares 270 409 36 196 – 306 605
31 March 2022
Acquired
during the year
Sold/disposed
during the year 31 March 2023
Number of shares 270 409 – – 270 409
TRANSACTIONS AND BALANCES WITH RELATED PARTIES
Compagnie Financière Richemont SA or significant shareholders
There were no fees paid during the year and no balances payable to or receivable from CFR SA or significant shareholders at 31 March 2024.
Reinet Investments Manager S.A.
31 March 2024
€ m
31 March 2023
€ m
– Expenses charged by the General Partner to the Company during the year 1.4 1.1
– Administration fee for the year 0.1 0.1
– Balance payable by the Company to the General Partner 1.1 0.8
Reinet Fund S.C.A., F.I.S.
31 March 2024
€ m
31 March 2023
€ m
– Balance payable by the Company to Reinet Fund – 0.7
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REINET INVESTMENTS S.C.A.
Reinet Fund Manager S.A.
31 March 2024
€ m
31 March 2023
€ m
– Expenses charged to Reinet Fund during the year 10.2 9.0
– Administration fee for the year 1.0 1.0
– Balance payable by Reinet Fund to the Fund Manager 9.0 7.5
Reinet Investment Advisors Limited
31 March 2024
€ m
31 March 2023
€ m
– Management fee charged during the year 37.0 39.0
– Performance fee charged during the year 90.0 –
– Balance payable by Reinet Fund to the Investment Advisor 108.9 18.7
There are no commitments between the Company and its related parties as at 31 March 2024.
14. BOARD OF OVERSEERS
Fees of € 70 000 per member were paid to the Board of Overseers in
respect of the year ended 31 March 2024, such fees are split equally
between the Company and Reinet Fund (31 March 2023: € 70000).
Mr Prussen is a partner with the law firm Elvinger Hoss Prussen.
Legal fees of € 0.1 million (31 March 2023: € 0.1 million) were
recorded in respect of Elvinger Hoss Prussen for the year ended
31March 2024.
15. AUDIT AND OTHER FEES PAID TO
PRICEWATERHOUSECOOPERS
Fees for the year ended 31 March 2024 billed and unbilled by
PricewaterhouseCoopers, Société cooperative, Luxembourg and other
member firms of the PricewaterhouseCoopers network, which relate
to the audit of the Company accounts, amounted to € 0.2 million
(31 March 2023: € 0.2 million). Such fees are presented under
‘Operating expenses’ in the statement of comprehensive income.
Audit fees relating to Reinet Fund and its principal subsidiaries as
shown in note 20 amounted to € 0.3 million for the year ended
31March 2024 (31 March 2023: € 0.3 million).
Fees relating to non-audit services during the year are considered to
be insignificant.
16. CAPITAL COMMITMENTS
At 31 March 2024, the Company had no capital commitments,
however its wholly-owned subsidiary Reinet Fund had committed
to invest a further € 559 million (31 March 2023: € 627 million) in
unlisted investments (see table on page 22). This amount relates to
Reinet Fund’s own investment commitments. Where Reinet Fund
co-invests with minority partners the amount does not include the
partners’ commitment.
17. CONTINGENT LIABILITIES
Reinet Fund has pledged 7.5 million BAT shares in respect of its
borrowing from Citibank N.A. and 7.5 million BAT shares in
respect of its borrowing from Bank of America, N.A.
18. DIVIDEND
A cash dividend of some € 54.5 million, or € 0.30 per share (excluding
treasury shares held), was paid in September 2023, following
approval at the annual general meeting on 29 August2023.
The proposed cash dividend payable to shareholders of € 0.35 per
share will be payable on 18 September 2024, once approved
by theshareholders at the annual general meeting to be held on
27August 2024.
19. SUBSEQUENT EVENTS
Reinet Fund, through wholly-owned subsidiaries, received an interim
dividend of some € 33 million (£ 28 million) from its investment
in BAT and a dividend of some € 85 million (£ 73million) from
its investment in Pension Corporation. The interim dividend from
BAT was declared by the directors of BAT with a record date
of 22 March 2024 and paid on 2 May 2024, and is included in
Reinet Fund’s financial results as at 31 March 2024. The Pension
Corporation dividend was approved by shareholders in April 2024
with a record date of 16 April 2024 and as such will be included in
Reinet Fund’s financial results in the year ended 31 March 2025.
During April and May 2024, Reinet Fund made payments in the
amount of € 32.2 million in respect of its commitments shown in
note 16.
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
71 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
20. INVESTMENTS HELD IN SUBSIDIARIES AND AFFILIATES
The principal companies held by Reinet Fund are as follows:
Investments Company Domicile Percentage held
BAT Reinet Jersey Holdings Limited Jersey, Channel Islands 100%
Pension Corporation Reinet PC Investments (Jersey) Limited Jersey, Channel Islands 100%
Trilantic Capital Partners Reinet TCP Holdings Limited Jersey, Channel Islands 94%
RSF S.A. Luxembourg 100%
Reinet TCP Fund V NECI Limited Jersey, Channel Islands 100%
Reinet New TCP NECI GP Limited Jersey, Channel Islands 100%
Reinet New TCP LP Limited Jersey, Channel Islands 100%
TruArc Partners Reinet SPG Limited Jersey, Channel Islands 100%
Coatue funds Reinet Columbus Limited Jersey, Channel Islands 100%
Asian private equity companies
and portfolio funds Reinet Columbus Limited Jersey, Channel Islands 100%
Specialised investment funds Reinet Columbus Limited Jersey, Channel Islands 100%
Reinet Flex Holdings Limited Jersey, Channel Islands 100%
United States land development RSF II Limited Jersey, Channel Islands 100%
and mortgages Reinet Stokes Holdings S.A. Luxembourg 100%
RPH Limited Jersey, Channel Islands 100%
Other investments Reinet Columbus Limited Jersey, Channel Islands 100%
Reinet Flex Holdings Limited Jersey, Channel Islands 100%
Reinet S.à r.l. Luxembourg 100%
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AUDIT REPORT
To the Shareholders of
Reinet Investments S.C.A.
Report on the audit of the consolidated financial statements
Our opinion
In our opinion, the accompanying consolidated financial statements
give a true and fair view of the consolidated financial position of
Reinet Investments S.C.A. (the ‘Company’) and its subsidiaries
(‘Reinet’) as at 31 March 2024, and of its consolidated financial
performance and its consolidated cash flows for the year then ended
in accordance with International Financial Reporting Standards
(‘IFRS Accounting Standards’) as adopted by the European Union.
Our opinion is consistent with our additional report to the Board of
Overseers or equivalent.
What we have audited
Reinet’s consolidated financial statements comprise:
• the consolidated balance sheet as at 31 March 2024;
• the consolidated statement of comprehensive income for the year
then ended;
• the consolidated statement of changes in equity for the year then
ended;
• the consolidated cash flow statement for the year then ended; and
• the notes to the consolidated financial statements, including
material accounting policy information and other explanatory
information.
Basis for opinion
We conducted our audit in accordance with the EU Regulation No
537/2014, the Law of 23 July 2016 on the audit profession (‘Law of
23 July 2016’) and with International Standards on Auditing (‘ISAs’)
as adopted for Luxembourg by the ‘Commission de Surveillance
du Secteur Financier’ (‘CSSF’). Our responsibilities under the
EURegulation No 537/2014, the Law of 23 July 2016 and ISAs as
adopted for Luxembourg by the CSSF are further described in the
‘Responsibilities of the ‘Réviseur d’entreprises agréé ’ for the audit of
the consolidated financial statements’ section of our report.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
We are independent of Reinet in accordance with the International
Code of Ethics for Professional Accountants, including International
Independence Standards, issued by the International Ethics Standards
Board for Accountants (‘IESBA Code’) as adopted for Luxembourg
by the CSSF together with the ethical requirements that are relevant
to our audit of the consolidated financial statements. We have fulfilled
our other ethical responsibilities under those ethical requirements.
To the best of our knowledge and belief, we declare that we have not
provided non-audit services that are prohibited under Article 5(1) of
the EU Regulation No 537/2014.
The non-audit services that we have provided to the Company and
its controlled undertakings, if applicable, for the year then ended, are
disclosed in note 15 to the consolidated financial statements.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the consolidated
financial statements of the current period. These matters were
addressed in the context of our audit of the consolidated financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Key audit matter
Existence of unlisted investments
All unlisted investments are held by Reinet Fund S.C.A., F.I.S.
(‘Reinet Fund’). We focused on the existence of unlisted investments
as a key audit matter because (1) of their importance; and (2) of the
complexity of their holding structure.
(1) As described on page 64 of the consolidated financial statements,
unlisted investments represent a significant amount of Reinet’s
investments (€ 4 577 million and 74 per cent of its net asset
value).
(2) The investments are diverse in their nature (regulated company
active in the insurance sector, private equity funds and related
partnerships, private start-up businesses, etc.) and are generally
held by Reinet Fund through intermediate holding companies
and comprise various financial instruments (common equity,
preferred equity, debt/loan instruments with ad hoc features,
etc.), which means that the exact determination of ownership in
each instrument and in each target investment is complex.
How our audit addressed the key audit matter
Our procedures over the existence of unlisted investments held by
Reinet Fund included, but were not limited to the following:
• we gained an understanding of the internal control environment
surrounding authorisation, completeness and accuracy of
investment transactions and the reconciliation of investment
holdings at year-end;
• we gained an understanding of the approach and controls of the
custodian bank of Reinet Fund in order to fulfil its legal duties;
• on a sample basis, we obtained and reviewed minutes of the
relevant board meetings approving new investments during the
year as well as all executed agreements in order to ensure that the
recording of transactions is in accordance with the detailed terms
and conditions of the legal agreements;
• on a sample basis, we obtained, reviewed and reconciled
independent ownership confirmations at year-end obtained
directly from relevant sources with the accounting records;
• we obtained and reviewed the custody confirmation at year-end
provided by the custodian bank and reconciled it with the
accounting records; and
• we verified the reconciliation between the accounting records
andthe detailed investment holding statements of Reinet Fund
at year-end.
Key audit matter
Valuation of Level 3 investments
We focused on the valuation of level 3 investments as a key audit
matter because (1) of their importance and (2) of the significant
degree of judgement involved and (3) the potential impact of the
Ukraine/Russia conflict on the fair value of these investments.
(1) As disclosed on page 64 of the consolidated financial
statementsas at 31 March 2024, Reinet held level 3 investments
of € 4 577 million, representing 74 per cent of its net asset value.
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
73 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
(2) The valuation of level 3 investments is complex and requires the
application of significant judgements by the Fund Manager. Both
the determination of the most appropriate valuation methodology
(market multiples, recent transaction prices with proper calibration,
net asset value approach, current value approach, or a mix of
various approaches) and of the significant unobservable inputs
(valuation premium/discount, peer group determination, etc.)
applied in determining the valuation of level 3 investments involve
a high degree of judgement. In addition, the Russian invasion of
Ukraine have led to significant levels of market uncertainty mostly
reflected in increased market, currency and commodity volatility.
Inappropriate judgements may have a material impact on the net
asset value of Reinet.
How our audit addressed the key audit matter
Our procedures over the valuation of level 3 investments held by
Reinet Fund included, but were not limited to the following:
• we obtained an understanding of the Fund Manager’s processes
and controls around the fair valuation of level 3 investments;
• we assessed the compliance of the valuation policies for all level 3
investments with IFRS;
• we reviewed, on a sample basis, the documentation of the Fund
Manager’s back-testing analysis;
• we obtained the year-end valuation reports produced by the
external valuation experts mandated by management to support
the valuations applied by Reinet and we performed an assessment
of the competence and objectivity of the external valuation experts;
• we ensured that investments are valued in accordance with
International Private Equity and Venture Capital Valuation
(‘IPEV’) guidelines and its approved valuation procedures and
methodologies;
• we reconciled the external valuation experts’ reports with the
year-end accounting records and the portfolio holding statements
and we reviewed the reports on a sample basis;
• on a sample basis, we discussed with the external valuation experts
the methodology applied to the level 3 valuations including but
not limited to changes in valuation approach compared to the
previous year, reliability of data, judgement on unobservable
and estimated inputs and support received from the underlying
investment managers;
• given the weight of Pension Corporation on the NAV of Reinet
(55.6 per cent) we discussed with management of Pension
Corporation the factors driving the change in the first quarter
2024 in its adjusted equity own funds;
• we assessed the appropriateness of the valuation methodologies
applied by the Fund Manager as well as the reasonableness of the
key assumptions and valuation model inputs used;
• we specifically challenged the significant unobservable inputs
used in the level 3 valuations (including peer group selection) and
assessed their consistency over multiple accounting periods;
• we ensured, on a sample basis, that the value of the private
equity funds as reported in their 31 March 2024 capital account
statements does not materially differ from the fair value determined
by the Fund Manager;
• for the most significant private equity funds and when capital
account statements as at 31 March 2024 are not available,
we obtained support from the respective general partners to
understand the drivers of the fair value at 31 March 2024, including
the processes and controls around fair value determination and
we corroborated that information, to the extent possible, with
externally available industry and country economic data;
• we reconciled the impact of both realised and unrealised valuation
movements with the net change in the fair value of financial assets
at fair value through profit or loss; and
• we assessed the appropriateness of the disclosures in the notes of
the financial statements to address the estimation of uncertainty.
Other information
Reinet Investments Manager S.A. (the ‘General Partner’) is
responsible for the other information. The other information
comprises the information stated in the annual report including
the consolidated management report and the corporate governance
statement but does not include the consolidated financial statements
and our audit report thereon.
Our opinion on the consolidated financial statements does not cover
the other information and we do not express any form of assurance
conclusion thereon.
In connection with our audit of the consolidated financial statements,
our responsibility is to read the other information identified
above and, in doing so, consider whether the other information is
materially inconsistent with the consolidated financial statements
or our knowledge obtained in the audit, or otherwise appears to
be materially misstated. If, based on the work we have performed,
we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to
report in this regard.
Responsibilities of the General Partner and those charged with
governance for the consolidated financial statements
The General Partner is responsible for the preparation and fair
presentation of the consolidated financial statements in accordance
with IFRS Accounting Standards as adopted by the European Union,
and for such internal control as the General Partner determines
is necessary to enable the preparation of consolidated financial
statements that are free from material misstatement, whether due to
fraud or error.
In preparing the consolidated financial statements, the General
Partner is responsible for assessing Reinet’s ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless
the General Partner either intends to liquidate Reinet or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing Reinet’s
financial reporting process.
The General Partner is responsible for presenting and marking
up the consolidated financial statements in compliance with the
requirements set out in the Delegated Regulation 2019/815 on
European Single Electronic Format (‘ESEF Regulation’).
Responsibilities of the ‘Réviseur d’entreprises agréé ’ for the
audit of the consolidated financial statements
The objectives of our audit are to obtain reasonable assurance about
whether the consolidated financial statements as a whole are free
from material misstatement, whether due to fraud or error, and to
issue an audit report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit
conducted in accordance with the EU Regulation No 537/2014, the
Law of 23 July 2016 and with ISAs as adopted for Luxembourg by
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REINET INVESTMENTS S.C.A.
the CSSF will always detect a material misstatement when it exists.
Misstatements can arise from fraud or error and are considered
material if, individually or in the aggregate, they could reasonably be
expected to influence the economic decisions of users taken on the
basis of these consolidated financial statements.
As part of an audit in accordance with the EU Regulation No
537/2014, the Law of 23 July 2016 and with ISAs as adopted for
Luxembourg by the CSSF, we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the
consolidated financial statements, whether due to fraud or error,
design and perform audit procedures responsive to those risks,
and obtain audit evidence that is sufficient and appropriate to
provide a basis for our opinion. The risk of not detecting a material
misstatement resulting from fraud is higher than for one resulting
from error, as fraud may involve collusion, forgery, intentional
omissions, misrepresentations, or the override of internal control;
• obtain an understanding of internal control relevant to the audit
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion
on the effectiveness of Reinet’s internal control;
• evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures
made by the General Partner;
• conclude on the appropriateness of the General Partner’s use of
the going concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty exists related
to events or conditions that may cast significant doubt on Reinet’s
ability to continue as a going concern. If we conclude that a
material uncertainty exists, we are required to draw attention in
our audit report to the related disclosures in the consolidated
financial statements or, if such disclosures are inadequate, to
modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our audit report. However,
future events or conditions may cause Reinet to cease to continue
as a going concern;
• evaluate the overall presentation, structure and content of the
consolidated financial statements, including the disclosures,
and whether the consolidated financial statements represent the
underlying transactions and events in a manner that achieves fair
presentation; and
• obtain sufficient appropriate audit evidence regarding the financial
information of the entities and business activities within Reinet to
express an opinion on the consolidated financial statements. We
are responsible for the direction, supervision and performance of
Reinet’s audit. We remain solely responsible for our audit opinion.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit and
significant audit findings, including any significant deficiencies in
internal control that we identify during our audit.
We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements regarding
independence, and communicate to them all relationships and
other matters that may reasonably be thought to bear on our
independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
From the matters communicated with those charged with governance,
we determine those matters that were of most significance in the
audit of the consolidated financial statements of the current period
and are therefore the key audit matters. We describe these matters in
our audit report unless law or regulation precludes public disclosure
about the matter.
We assess whether the consolidated financial statements have been
prepared, in all material respects, in compliance with the requirements
laid down in the ESEF Regulation.
Report on other legal and regulatory requirements
The consolidated management report is consistent with the
consolidated financial statements and has been prepared in
accordance with applicable legal requirements.
The corporate governance statement is included in the management
report. The information required by Article 68ter Paragraph
(1) Letters c) and d) of the Law of 19 December 2002 on the
commercial and companies register and on the accounting records
and annual accounts of undertakings, as amended, is consistent
with the consolidated financial statements and has been prepared in
accordance with applicable legal requirements.
We have been appointed as ‘Réviseur d’entreprises agréé ’ by the
General Meeting of the Shareholders on 4 March 2008 and the
duration of our uninterrupted engagement, including previous
renewals and reappointments, is 16 years.
We have checked the compliance of the consolidated financial
statements of Reinet as at 31 March 2024 with relevant statutory
requirements set out in the ESEF Regulation that are applicable to
consolidated financial statements.
For Reinet it relates to the requirement that:
• the consolidated financial statements are prepared in a valid
XHTML format; and
• the XBRL markup of the consolidated financial statements uses
the core taxonomy and the common rules on markups specified in
the ESEF Regulation.
In our opinion, the consolidated financial statements of Reinet as
at 31 March 2024 have been prepared, in all material respects, in
compliance with the requirements laid down in the ESEF Regulation.
PricewaterhouseCoopers, Société coopérative
Luxembourg, 27 May 2024
Represented by
Geoffroy Marcassoli
PricewaterhouseCoopers, Société coopérative,
2 rue Gerhard Mercator, B.P. 1443, L-1014 Luxembourg
T : +352 494848 1, F : +352 494848 2900, www.pwc.lu
Cabinet de révision agréé. Expert-comptable
(autorisation gouvernementale n°10028256)
R.C.S. Luxembourg B 65 477 - TVA LU25482518
AUDIT REPORT
CONTINUED
CONSOLIDATED FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
75 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
BALANCE SHEET
as at 31 March 2024
Notes
31 March 2024
€ 000’s
31 March 2023
€ 000’s
ASSETS
Fixed assets
Financial assets
Shares in affiliated undertakings 3 1 705 289 1 705 289
Own shares 4 221 674 221 674
1 926 963 1 926 963
Current assets
Cash at bank and in hand 211 171
Prepayments 171 149
382 320
Total assets 1 927 345 1 927 283
CAPITAL, RESERVES AND LIABILITIES
Capital and reserves
Subscribed capital 5 220 103 220 103
Share premium account 6 548 636 548 636
Reserves
– legal reserve 7 22 100 22 100
– reserve for own shares 8 221 674 221 674
Profit brought forward 9 858 227 861 710
Profit for the financial year 55 019 51 054
1 925 759 1 925 277
Creditors
Amounts owed to affiliated undertakings
– becoming due and payable within one year 10 1 131 1 532
Trade creditors
– becoming due and payable within one year 323 344
Other creditors
– becoming due and payable within one year 9 7
– becoming due and payable after more than one year 123 123
1 586 2 006
Total capital, reserves and liabilities 1 927 345 1 927 283
The accompanying notes form an integral part of these financial statements.
COMPANY FINANCIAL STATEMENTS
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
PROFIT AND LOSS ACCOUNT
for the year ended 31 March 2024
Notes
Year ended
31 March 2024
€ 000’s
Year ended
31 March 2023
€ 000’s
Income
Dividend received from Reinet Fund 13 58 000 55 000
Interest receivable and similar income 105 268
Total income 58 105 55 268
Charges
Other operating expenses 11 1 727 1 449
Other external expenses 12 1 323 1 393
Interest payable and similar expenses 31 1 367
Taxes 14 5 5
Total charges 3 086 4 214
Profit for the financial year 55 019 51 054
The accompanying notes form an integral part of these financial statements.
COMPANY FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
77 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
1. GENERAL INFORMATION
Reinet Investments S.C.A. (the ‘Company’), incorporated on
5 March 1979, is a partnership limited by shares (société en
commandite par actions) and is governed by the Luxembourg law on
securitisation. The Company’s registered office is at 35, boulevard
Prince Henri, L-1724, Luxembourg. The Company owns the entire
ordinary issued capital of Reinet Fund S.C.A., F.I.S. (‘Reinet Fund’),
a partnership limited by shares established in Luxembourg.
The Company was formerly known as Richemont S.A. and was a
subsidiary of Compagnie Financière Richemont SA (‘CFR SA’),
a Swiss company with significant luxury goods interests. The
Company is managed by Reinet Investments Manager S.A. (the
‘General Partner’), a limited company established in Luxembourg
(société anonyme), which also owns 1 000 management shares in
the Company. The General Partner has unlimited liability for any
obligations of the Company that cannot be met from the assets
of the Company. The General Partner’s registered office is at 35,
boulevard Prince Henri, L-1724, Luxembourg.
The Company’s financial year starts on 1 April and ends on 31March
of each year.
The Company has also prepared consolidated financial statements
which will be made available at the Company’s head office as
required by Luxembourg law.
2. SUMMARY OF SIGNIFICANT
ACCOUNTING POLICIES
2.1 BASIS OF PREPARATION
The financial statements have been prepared in accordance with
Luxembourg legal and regulatory requirements under the historical
cost convention, as well as with generally accepted accounting
principles in Luxembourg.
The Law of 18 December 2015, amending the Law of
19December2002 on the Register of Commerce and Companies
and the accounting and annual accounts of undertakings, and the
Grand-Ducal Regulation as of the same date, have revised the layout
of the balance sheet and profit and loss account.
The preparation of financial statements requires the use of certain
critical accounting estimates. It also requires the General Partner
to exercise its judgement in the process of applying the accounting
policies. Changes in assumptions may have a significant impact on
the financial statements in the period in which the assumptions
changed. The General Partner believes that the underlying
assumptions are appropriate and that the financial statements
therefore present the financial position and results fairly.
The Company makes estimates and assumptions that affect the
reported amounts of assets and liabilities in the next financial year.
Estimates and judgements are continually evaluated and are based
on historical experience and other factors, including expectations
of future events that are believed to be reasonable under the
circumstances.
2.2 FORMATION EXPENSES
The formation expenses of the Company are directly charged to the
profit and loss account of the year in which they are incurred.
2.3 FINANCIAL ASSETS
Shares in affiliated undertakings and the Company’s own shares held
as fixed assets are valued at purchase price. In case of permanent
impairment in value in the opinion of the General Partner, value
adjustments are made in respect of fixed assets, so that they are
valued at the lower figure to be attributed to them at the balance
sheet date. These value adjustments are not continued if the reasons
for which the value adjustments were made have ceased to apply.
In accordance with Luxembourg law, in case of acquisition of own
shares, an amount equal to the carrying amount is recorded in a
non-distributable reserve for own shares.
2.4 DEBTORS AND CREDITORS
Debtors and creditors are valued at their nominal value. The debtors
are subject to value adjustments where their recovery is compromised.
These value adjustments are not continued if the reason for which
the value adjustments were made have ceased to apply.
2.5 FOREIGN CURRENCY TRANSLATION
Transactions expressed in currencies other than euro are translated
into euro at the exchange rate effective at the time of the transaction.
Cash at bank is translated at the exchange rate effective at the balance
sheet date. Exchange gains and losses are recorded in the profit and
loss account of the year.
Fixed assets expressed in currencies other than euro are translated
into euro at the exchange rate effective at the time of the transaction.
At the balance sheet date, these assets remain at historic exchange
rates.
Other assets and liabilities are translated separately, respectively at
(i) the lower or at the higher of the value converted at the historical
exchange rate or (ii) the value determined on the basis of the
exchange rates effective at the balance sheet date. The unrealised
exchange gains and losses are thus recorded in the profit and loss
account. The realised exchange gains are recorded in the profit and
loss account at the moment of their realisation.
2.6 PREPAYMENTS
Prepayments include expenditure incurred in the financial year but
relating to a subsequent financial year.
2.7 PROVISIONS
Provisions are created to cover charges which originate in the
financial year under review or in a previous financial year, the nature
of which is clearly defined and which at the date of the balance
sheet are either likely to be incurred or certain to be incurred but
uncertain as to their amount at the date on which they will arise.
NOTES TO THE FINANCIAL STATEMENTS
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3. SHARES IN AFFILIATED UNDERTAKINGS
31 March 2024
€ 000’s
31 March 2023
€ 000’s
Book value – opening balance 1 705 289 1 745 289
Capital repaid in the year – (40 000)
Book value – closing balance 1 705 289 1 705 289
The Company holds the entire share capital of Reinet Fund, whose
functional currency is the euro.
At 31 March 2024, the net asset value of Reinet Fund was
€ 6 185 million (31 March 2023: € 5 721 million) and it recorded
a profit for the year of € 522 million (31 March 2023: loss of
€116million).
4. OWN SHARES
Treasury shares are recorded at cost, representing the price paid on
the acquisition date.
On 19 November 2018, the Company announced the
commencement of a share buyback programme in respect of
a maximum of 3.2 million ordinary shares for an aggregate
maximum amount of € 55 million. The programme ran from
20November2018 to 30 January 2019 when 3 200 000 ordinary
shares were repurchased for a cost of € 42 million, plus transaction
costs.
On 6 February 2019, the Company announced the commencement
of a second share buyback programme in respect of a maximum
of 5 million ordinary shares for an aggregate maximum amount
of € 75 million. The programme ran from 11 February 2019 to
31May 2019 when 3 449 689 ordinary shares were repurchased for
a cost of € 50 million, plus transaction costs.
On 14 June 2019, the Company announced the commencement
of a third share buyback programme in respect of a maximum of
2.75 million ordinary shares for an aggregate maximum amount
of € 44 million. The programme ran from 19 June 2019 to
23August2019 when 2 047 348 ordinary shares were repurchased
for a cost of € 31 million, plus transaction costs.
On 6 September 2019, the Company announced the commencement
of a fourth share buyback programme in respect of a maximum of
3.1 million ordinary shares for an aggregate maximum amount
of € 50 million. The programme ran from 11 September 2019
to 27 November 2019 when 2 954 358 ordinary shares were
repurchased for a cost of € 50 million, plus transaction costs.
On 24 March 2022, the Company announced the commencement
of a fifth share buyback programme in respect of a maximum of
2.5 million ordinary shares for an aggregate maximum amount of
€ 50 million closing on 3 June 2022. The programme ran from
28March 2022 to 23 May 2022 when 2 500 000 ordinary shares
were repurchased for a cost of € 49 million, plus transaction costs.
All ordinary shares repurchased are held as treasury shares.
As at 31 March 2024, there was no share buyback programme
inprogress.
Number
of shares
Cost
€ 000’s
Repurchased shares
1
st
buyback programme 3 200 000 41 964
2
nd
buyback programme 3 449 689 49 866
3
rd
buyback programme 2 047 348 30 792
4
th
buyback programme 2 954 358 49 824
5
th
buyback programme 2 500 000 49 228
Own shares held at 31 March 2024 14 151 395 221 674
COMPANY FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
CONTINUED
REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
5. SUBSCRIBED CAPITAL
31 March 2024
€ 000’s
31 March 2023
€ 000’s
Ordinary shares
Subscribed capital – 195 941 286 ordinary shares
(31 March 2023: 195 941 286), fully paid with no par value 220 102 220 102
Total ordinary share capital 220 102 220 102
Management shares
Subscribed capital – 1 000 management shares
(31 March 2023: 1 000), fully paid with no par value 1 1
Total management share capital 1 1
Total capital 220 103 220 103
The ordinary shares, excluding the voting and dividend rights
attached to treasury shares which are suspended, confer on the
shareholder the entitlement to participate in and to vote at meetings
of shareholders, with each share carrying the right to one vote. Each
share also entitles each shareholder to receive a proportionate share
of any dividend that the Company may declare and a proportionate
share of the net assets of the Company on liquidation. The liability
of ordinary shareholders is limited to the amount of their investment
in the Company.
The management shares are held by the General Partner and confer
the same rights with regard to voting, dividends and the distribution
of assets on liquidation as the ordinary shares. In addition, as the
holder of the management shares, the General Partner has broad
powers to manage the Company and has unlimited liability for any
obligations of the Company that cannot be met from the assets of
the Company.
6. SHARE PREMIUM ACCOUNT
The share premium relates to a reserve amounting to € 548 635 737
(31 March 2023: € 548 635 737), available for distribution subject to
the approval of the shareholders.
7. LEGAL RESERVE
In accordance with Luxembourg law, the Company allocated
annually a minimum of 5 per cent of its net profit to the legal
reserve, which now equals 10 per cent of the subscribed capital.
The legal reserve amounting to € 22 100 000 (31 March 2023:
€22100 000) is not available for distribution.
8. RESERVE FOR OWN SHARES
The Company repurchased a total of 14 151 395 own shares for
an amount of € 221 674 392. In accordance with Luxembourg
law, the Company has created a non-distributable reserve for the
sameamount.
9. PROFIT OR LOSS BROUGHT FORWARD
31 March 2024
€ 000’s
31 March 2023
€ 000’s
Opening balance 861 710 867 240
Dividend paid (54 537) (50 902)
807 173 816 338
Result for the prior year 51 054 45 372
Balance brought forward 858 227 861 710
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REINET INVESTMENTS S.C.A.
10. AMOUNTS OWED TO AFFILIATED UNDERTAKINGS
31 March 2024
€ 000’s
31 March 2023
€ 000’s
Becoming due and payable after less than one year 1 131 1 532
11. EMOLUMENTS GRANTED TO MEMBERS OF THE ADMINISTRATIVE, MANAGERIAL AND
SUPERVISORY BODIES
Year ended
31 March 2024
€ 000’s
Year ended
31 March 2023
€ 000’s
General Partner 1 487 1 228
Board of Overseers 140 140
1 627 1 368
12. AUDIT AND OTHER FEES PAID TO
PRICEWATERHOUSECOOPERS
Fees for the year ended 31 March 2024 billed and unbilled by
PricewaterhouseCoopers, Société coopérative, Luxembourg and
other member firms of the PricewaterhouseCoopers network,
which relate to the audit of the Company accounts, amounted to
€0.2million (31 March 2023: € 0.2 million). Such fees are presented
under ‘Other external expenses’ in the profit and loss account.
Fees relating to non-audit services during the year are considered to
be insignificant.
13. RELATED PARTY TRANSACTIONS
During the financial year under review all transactions with related
parties have been conducted on an arm’s-length basis and on normal
market terms.
A dividend of € 58 million was received from Reinet Fund in the
year (31 March 2023: € 55 million).
No capital repayments were received from Reinet Fund in the year
(31 March 2023: € 40 million).
14. TAXATION
The Company is subject to tax as determined by Luxembourg law,
which takes into account profit for the financial year and dividends
paid to shareholders in the current year.
15. SUBSEQUENT EVENTS
There have been no events subsequent to 31 March 2024 which
would have any material impact on these financial statements.
COMPANY FINANCIAL STATEMENTS
NOTES TO THE FINANCIAL STATEMENTS
CONTINUED
REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
€ 000’s
Available retained earnings
Balance brought forward 912 764
Dividend paid (54 537)
858 227
Net profit for the financial year 55 019
Balance at the end of the year 913 246
PROPOSED APPROPRIATION
The proposed ordinary dividend payable to the Company’s shareholders of € 0.35 per share will be payable on 18 September 2024, once
approved by the shareholders at the annual general meeting to be held on 27 August 2024.
The available retained earnings remaining after deduction of the dividend amount will be carried forward to the following year.
Reinet Investments Manager S.A.
General Partner
Luxembourg, 23 May 2024
PROPOSED APPROPRIATION OF RETAINED EARNINGS
as at 31 March 2024
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REINET INVESTMENTS S.C.A.
AUDIT REPORT
To the Shareholders of
Reinet Investments S.C.A.
Report on the audit of the financial statements
Our opinion
In our opinion, the accompanying financial statements give a true
and fair view of the financial position of Reinet Investments S.C.A.
(the ‘Company’) as at 31 March 2024, and of the results of its
operations for the year then ended in accordance with Luxembourg
legal and regulatory requirements relating to the preparation and
presentation of the financial statements.
Our opinion is consistent with our additional report to the Board of
Overseers or equivalent.
What we have audited
The Company’s financial statements comprise:
• the balance sheet as at 31 March 2024;
• the profit and loss account for the year then ended; and
• the notes to the financial statements, which include a summary of
significant accounting policies.
Basis for opinion
We conducted our audit in accordance with the EU Regulation No
537/2014, the Law of 23 July 2016 on the audit profession (‘Law of
23 July 2016’) and with International Standards on Auditing (‘ISAs’)
as adopted for Luxembourg by the ‘Commission de Surveillance du
Secteur Financier’ (‘CSSF’). Our responsibilities under the EU
Regulation No 537/2014, the Law of 23 July 2016 and ISAs as
adopted for Luxembourg by the CSSF are further described in the
‘Responsibilities of the ‘Réviseur d’entreprises agréé ’ for the audit of
the financial statements’ section of our report.
We believe that the audit evidence we have obtained is sufficient and
appropriate to provide a basis for our opinion.
We are independent of the Company in accordance with the
International Code of Ethics for Professional Accountants, including
International Independence Standards, issued by the International
Ethics Standards Board for Accountants (‘IESBA Code’) as adopted
for Luxembourg by the CSSF together with the ethical requirements
that are relevant to our audit of the financial statements. We have
fulfilled our other ethical responsibilities under those ethical
requirements.
To the best of our knowledge and belief, we declare that we have not
provided non-audit services that are prohibited under Article 5(1) of
the EU Regulation No 537/2014.
The non-audit services that we have provided to the Company and
its controlled undertakings, if applicable, for the year then ended,
are disclosed in note 12 to the financial statements.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the financial
statements of the current period. These matters were addressed in
the context of our audit of the financial statements as a whole, and
in forming our opinion thereon, and we do not provide a separate
opinion on these matters.
We have determined that there are no key audit matters to
communicate in our report.
Other information
The General Partner is responsible for the other information.
The other information comprises the information stated in the
management report and the corporate governance statement but
does not include the financial statements and our audit report
thereon.
Our opinion on the financial statements does not cover the other
information and we do not express any form of assurance conclusion
thereon.
In connection with our audit of the financial statements, our
responsibility is to read the other information identified above and,
in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained
in the audit, or otherwise appears to be materially misstated. If,
based on the work we have performed, we conclude that there is a
material misstatement of this other information, we are required to
report that fact. We have nothing to report in this regard.
Responsibilities of the General Partner and those charged with
governance for the financial statements
The General Partner is responsible for the preparation and fair
presentation of the financial statements in accordance with
Luxembourg legal and regulatory requirements relating to the
preparation and presentation of the financial statements, and for
such internal control as the General Partner determines is necessary
to enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the General Partner is
responsible for assessing the Company’s ability to continue as a
going concern, disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting unless the
General Partner either intends to liquidate the Company or to cease
operations, or has no realistic alternative but to do so.
Those charged with governance are responsible for overseeing the
Company’s financial reporting process.
The General Partner is responsible for presenting the financial
statements in compliance with the requirements set out in the
Delegated Regulation 2019/815 on European Single Electronic
Format (‘ESEF Regulation’).
Responsibilities of the ‘Réviseur d’entreprises agréé ’ for the
audit of the financial statements
The objectives of our audit are to obtain reasonable assurance about
whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an audit
report that includes our opinion.
COMPANY FINANCIAL STATEMENTS
REINET INVESTMENTS S.C.A.
83 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
Reasonable assurance is a high level of assurance, but is not a
guarantee that an audit conducted in accordance with the EU
Regulation No 537/2014, the Law of 23 July 2016 and with ISAs as
adopted for Luxembourg by the CSSF will always detect a material
misstatement when it exists. Misstatements can arise from fraud or
error and are considered material if, individually or in the aggregate,
they could reasonably be expected to influence the economic
decisions of users taken on the basis of these financial statements.
As part of an audit in accordance with the EU Regulation No
537/2014, the Law of 23 July 2016 and with ISAs as adopted for
Luxembourg by the CSSF, we exercise professional judgement and
maintain professional scepticism throughout the audit. We also:
• identify and assess the risks of material misstatement of the
financial statements, whether due to fraud or error, design and
perform audit procedures responsive to those risks, and obtain
audit evidence that is sufficient and appropriate to provide a basis
for our opinion. The risk of not detecting a material misstatement
resulting from fraud is higher than for one resulting from error,
as fraud may involve collusion, forgery, intentional omissions,
misrepresentations, or the override of internal control;
• obtain an understanding of internal control relevant to the audit
in order to design audit procedures that are appropriate in the
circumstances, but not for the purpose of expressing an opinion
on the effectiveness of the Company’s internal control;
• evaluate the appropriateness of accounting policies used and the
reasonableness of accounting estimates and related disclosures
made by the General Partner;
• conclude on the appropriateness of the General Partner’s use
of the going concern basis of accounting and, based on the
audit evidence obtained, whether a material uncertainty exists
related to events or conditions that may cast significant doubt
on the Company’s ability to continue as a going concern. If we
conclude that a material uncertainty exists, we are required to
draw attention in our audit report to the related disclosures in
the financial statements or, if such disclosures are inadequate,
to modify our opinion. Our conclusions are based on the audit
evidence obtained up to the date of our audit report. However,
future events or conditions may cause the Company to cease to
continue as a going concern; and
• evaluate the overall presentation, structure and content of the
financial statements, including the disclosures, and whether the
financial statements represent the underlying transactions and
events in a manner that achieves fair presentation.
We communicate with those charged with governance regarding,
among other matters, the planned scope and timing of the audit
and significant audit findings, including any significant deficiencies
in internal control that we identify during our audit.
We also provide those charged with governance with a statement
that we have complied with relevant ethical requirements regarding
independence, and communicate to them all relationships and
other matters that may reasonably be thought to bear on our
independence, and where applicable, actions taken to eliminate
threats or safeguards applied.
From the matters communicated with those charged with
governance, we determine those matters that were of most
significance in the audit of the financial statements of the current
period and are therefore the key audit matters. We describe these
matters in our audit report unless law or regulation precludes public
disclosure about the matter.
We assess whether the financial statements have been prepared, in
all material respects, in compliance with the requirements laid down
in the ESEF Regulation.
Report on other legal and regulatory requirements
The management report is consistent with the financial statements
and has been prepared in accordance with applicable legal
requirements.
The corporate governance statement is included in the management
report. The information required by Article 68ter Paragraph
(1) Letters c) and d) of the Law of 19 December 2002 on the
commercial and companies register and on the accounting records
and annual accounts of undertakings, as amended, is consistent with
the financial statements and has been prepared in accordance with
applicable legal requirements.
We have been appointed as ‘Réviseur d’entreprises agréé ’ by the
General Meeting of the Shareholders on 4 March 2008 and the
duration of our uninterrupted engagement, including previous
renewals and reappointments, is 16 years.
We have checked the compliance of the financial statements of the
Company as at 31 March 2024 with relevant statutory requirements
set out in the ESEF Regulation that are applicable to financial
statements.
For the Company it relates to the requirement that the financial
statements are prepared in a valid XHTML format.
In our opinion, the financial statements of the Company as at
31 March 2024 have been prepared, in all material respects,
in compliance with the requirements laid down in the ESEF
Regulation.
PricewaterhouseCoopers, Société coopérative
Luxembourg, 27 May 2024
Represented by
Geoffroy Marcassoli
PricewaterhouseCoopers, Société coopérative,
2 rue Gerhard Mercator, B.P. 1443, L-1014 Luxembourg
T : +352 494848 1, F : +352 494848 2900, www.pwc.lu
Cabinet de révision agréé. Expert-comptable
(autorisation gouvernementale n
o
10028256)
R.C.S. Luxembourg B 65 477 – TVA LU25482518
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REINET INVESTMENTS S.C.A.
NOTICE OF ANNUAL GENERAL MEETING
Notice of the annual general meeting of shareholders of Reinet
Investments S.C.A. to be held on 27 August 2024
Shareholders are invited to attend the annual general meeting of
shareholders of Reinet Investments S.C.A. (the ‘Company’) in
person or by proxy.
The annual general meeting (the ‘Meeting’) will take place on:
Tuesday, 27 August 2024 at 2:00 pm at Hotel Le Royal, 12,
boulevard Royal, L-2449 Luxembourg.
AGENDA
Business reports for the accounting year ended 31 March 2024
1. To consider the report of the General Partner to the
shareholders; the report of the Board of Overseers; and the
reports of the approved statutory auditor of the Company in
respect of the statutory financial statements of the Company
and in respect of the consolidated financial statements for the
accounting year ended 31 March 2024.
Financial statements
2. To approve the statutory financial statements of the Company
for the accounting year ended 31 March 2024.
3. To approve the consolidated financial statements of the
Company for the accounting year ended 31 March 2024.
Appropriations
4. At 31 March 2024, the retained earnings available for
distribution amounted to € 913 245 481. The General Partner
proposes that a cash dividend of € 0.35 per share be paid. The
General Partner proposes that the remaining available retained
earnings of the Company at 31 March 2024 after payment of
the dividend be carried forward to the following business year.
Granting of discharge of liability to the General Partner and
Board of Overseers
5. To grant discharge of liability to the General Partner and all the
members of the Board of Overseers of the Company who have
been in office during the accounting year ended 31March2024
for the performance of their duties.
Board of Overseers
6. To re-elect Mr J Li, Mr Y Prussen, Mr S Robertson and
MrSRowlands as members of the Board of Overseers for the
year ending at the next annual general meeting.
7. To approve a remuneration of € 70 000 per annum for each
of the members of the Board of Overseers, such fees to be split
equally between the Company and Reinet Fund S.C.A., F.I.S.
Authorisation to acquire ordinary shares
8. At the meeting held on 29 August 2023, shareholders
authorised the Company to acquire ordinary shares within the
limits approved at that meeting for a period up to the date of
the Meeting to be held in 2024, subject to such period being
no longer than 13 months from the date of the authorisation.
Pursuant to Article 9 of the Company’s Statutes and relevant
Luxembourg law, the General Partner proposes that a new
authorisation be granted to the Company to acquire ordinary
shares, directly or indirectly (through subsidiaries or otherwise, such
as through an intermediary or agent) for a period up to the date
of the next meeting, subject to such period being no longer than
13months from the date of this authorisation.
The General Partner proposes that the Company be authorised
to acquire, in accordance with applicable laws and regulations,
ordinary shares up to 20 per cent of the Company’s issued ordinary
share capital which at the date of authorisation, 27 August 2024,
is 195 941 286 ordinary shares, for valuable consideration, by
all means, on any one or combination of the Luxembourg Stock
Exchange, Euronext Amsterdam or the Johannesburg Stock
Exchange, at a price no more than an amount equal to 110 per cent
of the reference price of the ordinary shares on the relevant exchange
and not less than one euro cent; the reference price being the
weighted average price for the market value for such ordinary shares
for the five days of trading immediately prior to the acquisition of
such shares.
The General Partner will at all times retain full discretion with
regards to the acquisition of the shares of the Company. This
includes whether to and when to initiate any acquisition process and
to determine the quantum and terms and conditions of any such
planned acquisition of ordinary shares of the Company (subject
to the limits set out above), having regard to, inter alia, available
liquidity in order to fulfil any purchase and other obligations of the
Company and the anticipated acquisition price per share relative to
the estimated net asset value per share of the Company at that time.
The present notice, the statutory financial statements and the
consolidated financial statements of the Company for the
accounting year ended 31 March 2024, together with the reports
of the approved statutory auditor, of the Board of Overseers and of
the General Partner and any draft resolutions, are available at the
registered office of the Company and on the Company’s website:
www.reinet.com.
The Meeting will be validly constituted to resolve on the matters
raised in the agenda regardless of the number of shares represented
at the Meeting; resolutions to be considered at the Meeting are
approved by a simple majority of the votes cast. The Meeting will
be held in English.
Shareholders who together hold at least 5 per cent of the share capital
may place items on the agenda of the Meeting and submit draft
resolutions for all the items on the agenda. Any such request must reach
the Registrar, UI efa S.A., by email (operational_readiness@efa.eu) no
later than 5 August 2024.
Every shareholder who attends the Meeting shall have the right to
ask questions related to the items on the agenda of the Meeting.
The official notice convening the annual general meeting will be published in the Luxemburger Wort, RESA the Luxembourg online legal publication platform, on the website of the Company and
of the Luxembourg Stock Exchange and sent to all shareholders recorded in the register of shareholders of the Company by registered letter and distributed by the Registrar through the usual channels
in accordance with Luxembourg law and may differ from this notice in respect of the definitive proposals.
REINET INVESTMENTS S.C.A.
85 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
Instructions for attendance and voting
Persons entitled to participate in and vote at the Meeting are all
persons (or their proxy) who were shareholders of record of the
Company at midnight on 13 August 2024 Luxembourg time
(the‘Record Date’).
(i) Instructions for holders of shares whose ownership is directly
recorded in the Company’s shareholders’ register (defined for
the purposes of this section only as ‘Registered Shareholders’)
Registered Shareholders whose ownership is directly recorded in their
own name in the Company’s shareholders’ register who wish to attend
the Meeting or who wish to appoint a proxy to represent them at
the Meeting must notify the Registrar, UI efa S.A., 2, rue d’Alsace,
L-1122 Luxembourg no later than 20 August 2024. The Registrar
will draw up a list of shareholders and proxy holders authorised to
attend theMeeting.
Registration forms to request admission to the Meeting or to appoint
a proxy to attend the Meeting may be obtained from the Registrar or
downloaded from the Company’s website: www.reinet.com.
Registered Shareholders may appoint a proxy, who need not
be a shareholder, as their representative at the Meeting. Forms
of proxy are provided on the registration forms for admission
to the Meeting. The signed proxy must be sent by mail, telefax
(+352 48 65 61 8002) or email to either the Company or UI efa S.A.
(operational_readiness@efa.eu).
Proxy voting instructions may be given to the Chairman of the
Meeting; these must be received by the Registrar duly completed and
signed by 20 August 2024. Unless proxies given to the Chairman of the
Meeting include explicit instructions as to the contrary, voting rights
will be exercised in support of the proposals of the GeneralPartner.
Registration forms for admission to the Meeting must be delivered
to the Registrar on 20 August 2024 at the latest. No admission cards
will be issued after that day.
(ii) Instructions for shareholders whose shares are held in the
European clearing systems (Euroclear Nederland, Euroclear
Bank, Clearstream) and are traded on Euronext Amsterdam or
the Luxembourg Stock Exchange (defined for the purposes of
this section only as ‘European Shareholders’)
European Shareholders may (a) attend the Meeting in person,
(b) appoint a proxy (who need not be a shareholder) as their
representative at the Meeting or (c) grant a proxy and issue voting
instructions prior to the Meeting.
(a) Attending the Meeting in person
European Shareholders who wish to attend the Meeting may follow
either of the following processes:
(1)
Register via the e-voting platform (‘Evote by ING’) administered
by ING Bank (‘ING’) at https://evote.ingwb.com or via their
own intermediary, in any event no later than 20 August 2024.
After registration on the Evote by ING Platform, the European
Shareholders’ information provided will be verified with the
information held by the European Shareholders’ intermediary as
at the Record Date. When the intermediary has confirmed the
information, the registration will be accepted. Duly registered
European Shareholders will be provided by ING with an
attendance card and details on how to gain access to the Meeting
by email.
(2) Send in a legally valid written registration form to ING at the
address below, in any event no later than 20 August 2024.
A registration form to request admission to the Meeting is
available as of today at www.reinet.com. European Shareholders
must also instruct their bank or financial intermediary with
whom the shares are on deposit to send a certificate (the
‘Shareholding Certificate’) to ING at the address below to be
received no later than 20 August 2024 indicating clearly the
precise identity of the European Shareholder and confirming
the number of shares being held by the European Shareholder
as at the Record Date. After completion of this registration
process, European Shareholders will be provided by ING by
email with an attendance card and details on how to gain access
to the Meeting.
(b) Appointing a proxy as their representative at the Meeting
European Shareholders’ who wish to appoint a proxy, as their
representative at the Meeting may follow either of the following
processes:
(1) Register their proxy via the Evote by ING Platform at
https://evote.ingwb.com or via their own intermediary, in any
event no later than 20 August 2024. After registration on
the Evote by ING Platform, the European Shareholder’s
information provided will be verified with the information held
by the European Shareholders’ intermediary as at the Record
Date. When the intermediary has confirmed the information,
the registration will be accepted. European Shareholders who
have duly registered their proxy will be provided by ING with
(an) attendance card(s) with proxy registration by email.
(2) Send in a legally valid written proxy instrument to ING at
the address below, in any event no later than 20August2024.
A proxy form is available as of today at www.reinet.com.
European Shareholders who wish to appoint a proxy must
also instruct their bank or financial intermediary with whom
the shares are on deposit to send a Shareholding Certificate
to ING at the address below to be received no later than
20August2024 indicating clearly the precise identity of the
European Shareholder and confirming the number of shares
being held by the European Shareholder as at the Record
Date. After completion of this registration process, European
Shareholders will be provided by ING by email with an
attendance card with proxy registration.
(c) Granting a proxy and issuing voting instructions
European Shareholders who wish to grant a proxy and issue voting
instructions prior to the Meeting may follow either of the following
processes:
(1) Register their instructions via the Evote by ING Platform at
https://evote.ingwb.com or via their intermediary in any event
no later than 20 August 2024. After registration on the Evote
by ING Platform, the European Shareholders’ information
provided will be verified with the information held by the
European Shareholders’ intermediary as at the Record Date.
When the intermediary has confirmed the information the
voting instructions will be accepted.
(2) Sending in a legally valid written proxy instrument to ING at
the address below, in any event no later than 20 August 2024.
A proxy voting form is available as of today at www.reinet.com.
Proxy voting instructions may be given to the Chairman of the
86
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
Meeting. A Shareholding Certificate in respect of the shares must
be provided to ING at the address below to be received no later
than 20 August 2024 indicating clearly the precise identity of
the shareholder and confirming the number of shares being held
by the European Shareholder as at the Record Date. Failure to
provide the Shareholding Certificate will invalidate the proxy
voting instructions. A person designated by the Company will
collect all voting instructions and submit them at the Meeting.
Unless proxies given to the Chairman of the Meeting include
explicit instructions as to the contrary, voting rights will be
exercised in support of the proposals of the General Partner.
The Evote by ING Platform is available from the publication date
of this convocation until seven days before the Meeting. This means
that European Shareholders can use the Evote by ING Platform from
26 July 2024 to 20 August 2024, 17:00 CEST. The Evote by ING
Platform will close on 20 August 2024, 17:00 CEST, but European
Shareholders can still view any instructions they have given.
ING address:
ING Bank N.V.
Attn. Robert Peerenboom
Issuer Services, Location code TRC 02.039
Foppingadreef 7, 1102 BD Amsterdam
The Netherlands
Email address ING: agm.pas@ing.com
(iii) Instructions for shareholders whose shares are held in South
Africa through Central Securities Depository Participants
(‘CSDPs’) or brokers and are traded on the Johannesburg
Stock Exchange (defined for the purposes of this section only
as ‘South African Shareholders’)
South African Shareholders who were shareholders of record of the
Company at midnight on 23 July 2024 (the ‘Posting Record Date’)
will receive a notice of the Meeting. The notice of the Meeting will
be distributed on 26 July 2024.
South African Shareholders whose ownership is indirectly recorded
through CSDPs and brokers whose shares are traded on the
Johannesburg Stock Exchange and who wish to attend the Meeting,
either in person or by proxy, must advise their broker or CSDP in
accordance with the mandate with their broker or CSDP, and their
broker or CSDP will issue the necessary letter of representation to the
South African Shareholder to allow the South African Shareholder
or their proxy holder to attend and vote at the Meeting. The broker
or CSDP of South African Shareholders should contact South
African Shareholders to ascertain how they wish to cast their vote
at the Meeting and should thereafter cast the votes in accordance
with the South African Shareholders’ instructions. If South African
Shareholders have not been contacted by their broker or CSDP, it is
advisable for them to contact their broker or CSDP and furnish it
with their voting instructions.
If a broker or CSDP does not obtain voting instructions from a
South African Shareholder, it will be obliged to vote in accordance
with the instructions contained in the custody agreement concluded
between the South African Shareholder and their broker or CSDP.
A registration form to request admission to the Meeting or to
appoint a proxy is available as of today at www.reinet.com.
As the Record Date is 13 August 2024, the last day to trade to
determine eligible South African Shareholders that may vote at the
Meeting is 7 August 2024.
Requests for letters of representation and voting instructions
must be submitted by brokers and CSDPs to Strate no later than
12:30 pm (South African time) on 20 August 2024 so that they
may be collated and verified by Strate prior to the Meeting. South
African Shareholders should therefore submit their requests for a
letter of representation or voting instructions to their broker or
CSDP within the time period required by their broker or CSDP
or as stipulated in the custody agreement concluded between South
African Shareholders and their broker or CSDP.
(iv) Admittance to the Meeting
Registration for admission to the Meeting will take place from one
hour prior to commencement of the Meeting. Shareholders or their
proxy holders shall hand in the attendance card at the registration
desk, will need to sign the attendance list of the Meeting and
may be requested to provide proof of identity before and during
the Meeting. A proxy holder shall also be requested to hand in a
copy/original of their proxy instrument at the registration desk.
Shareholders or proxy holders not registered to attend the Meeting
will not be allowed to participate.
Personal data processing
Shareholders are informed that the Company, as controller, processes
the personal data of the shareholders and proxyholders (name,
address, contact details, shareholding) in the context of the Meeting
in accordance with applicable data protection laws. The Company
processes such personal data in order to comply with the legal
obligation of holding such a Meeting. Such personal data will be used
for the purposes of analysing and administering the attendance and
voting process in connection with the Meeting and will be accessed
by entities assisting in the administration of the voting process such
as the Registrar, ING and South African entities processing personal
data of the South African Shareholders on behalf of the Company.
Shareholders and proxyholders may notably request access to
and rectification of the personal data processed by the Company
by contacting the Company Secretary Ms Caroline Apostol,
35boulevard Prince Henri, L-1724Luxembourg, tel: +352224210,
email: data-protection@reinet.com.
Reinet Investments Manager S.A.
General Partner
For and on behalf of
REINET INVESTMENTS S.C.A.
Luxembourg, 23 May 2024
NOTICE OF ANNUAL GENERAL MEETING
CONTINUED
REINET INVESTMENTS S.C.A.
87 REINET INVESTMENTS S.C.A.
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ANNUAL REPORT 2024
EXCHANGE RATES AND SHARE INFORMATION
EXCHANGE RATES AGAINST THE EURO
Year ended
31 March 2024
Year ended
31 March 2023
Average for the year
Sterling 0.8628 0.8641
US dollar 1.0846 1.0415
Swiss franc 0.9609 0.9942
South African rand 20.3175 17.6943
Closing – as at the end of the year
Sterling 0.8550 0.8793
US dollar 1.0795 1.0841
Swiss franc 0.9734 0.9926
South African rand 20.3842 19.2901
SHARE INFORMATION
Reinet Investments S.C.A. (the ‘Company’) ordinary shares are listed and traded on the Luxembourg Stock Exchange (symbol ‘REINI’, Refinitiv
code REIT.LU), on Euronext Amsterdam (symbol ‘REINA’, Refinitiv code REIT.AS) and on the Johannesburg Stock Exchange (symbol
‘RNI’, Refinitiv code RNIJ.J) with the ISIN number LU0383812293; the listing on the Johannesburg Stock Exchange is a secondary listing.
TheCompany’s ordinary shares are included in the ‘LuxX’ index of the principal shares traded on the Luxembourg Stock Exchange.
As at 31 March 2024 and 31 March 2023, there were 195 941 286 ordinary shares and 1 000 management shares in issue.
As at 31 March 2024 and 31 March 2023, the Company held 14 151 395 ordinary shares as treasury shares. The voting and dividend
rights attached to the treasury shares are suspended. Therefore, the total number of voting rights at 31 March 2024 and 31 March 2023
was181790891.
DAILY CLOSING PRICES FROM 31 MARCH 2023 TO 31 MARCH 2024
(1)
(1) The EUR:ZAR exchange rate was 1:19.2901 on 31 March 2023 and 1:20.3842 on 31 March 2024.
(2) Represents the closing share price of the Company on the Luxembourg Stock Exchange (listed under the symbol ‘REINI’).
(3) Represents the closing share price of the Company on Euronext Amsterdam (listed under the symbol ‘REINA’).
(4) Represents the closing share price of the Company on the Johannesburg Stock Exchange (listed under the symbol ‘RNI’).
Source: Refinitiv.
Closing share price EUR
Closing share price ZAR
Luxembourg share price in EUR
(2)
Amsterdam share price in EUR
(3)
Johannesburg share price in ZAR
(4)
ZAR 458.23
ZAR 365.06
EUR 18.80 EUR 22.20
EUR 22.20EUR 19.00
16
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88
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REINET INVESTMENTS S.C.A.
REINET INVESTMENTS S.C.A.
REGISTERED OFFICE
REINET INVESTMENTS S.C.A.
35, boulevard Prince Henri
L-1724 Luxembourg
Grand Duchy of Luxembourg
Telephone: +352 22 42 10
Company Secretary: Ms C Apostol
REGISTERED NUMBER
REINET INVESTMENTS S.C.A.
Registre de commerce et des sociétés, Luxembourg B 16.576
GENERAL PARTNER
REINET INVESTMENTS MANAGER S.A.
35, boulevard Prince Henri
L-1724 Luxembourg
Grand Duchy of Luxembourg
Telephone: +352 22 42 10
Company Secretary: Ms C Apostol
CUSTODIAN
BANQUE DE LUXEMBOURG S.A.
14, boulevard Royal
L-2449 Luxembourg
Grand Duchy of Luxembourg
REGISTRAR AND PAYING AGENT
UI efa S.A.
2, rue d’Alsace
P.O. Box 1725
L-1017 Luxembourg
Grand Duchy of Luxembourg
Telefax: +352 48 65 61 8002
EURONEXT AMSTERDAM LISTING AGENT
AND DUTCH PAYING AGENT
ING BANK N.V.
Bijlmerplein 106
1102 CT Amsterdam
The Netherlands
JOHANNESBURG STOCK EXCHANGE
SPONSOR
RAND MERCHANT BANK
(A division of FirstRand Bank Limited)
1 Merchant Place
Corner Fredman Drive and Rivonia Road
Sandton, 2146
Republic of South Africa
RÉVISEUR D’ENTREPRISES AGRÉÉ
PRICEWATERHOUSECOOPERS, SOCIÉTÉ COOPÉRATIVE
2, rue Gerhard Mercator
L-2182 Luxembourg
Grand Duchy of Luxembourg
FURTHER INFORMATION
Legal Entity Identifier: 222100830RQTFVV22S80
Website: www.reinet.com
Email: info@reinet.com
STATUTORY INFORMATION
DATA PROTECTION
The Company acting through the General Partner collects, processes and stores personal data in relation to the shareholders in compliance with
EU Regulation No 2016/679 of 27 April 2016 (the ‘General Data Protection Regulation’) as well as any complementing or other law or regulation
relating to the protection of personal data applicable to the Company. In this respect, the Company acts as data controller. All the information
in relation to the processing of the shareholders’ personal data carried out by the Company is detailed in a data protection information notice
available on the Company’s website: www.reinet.com/investor-relations/data-protection. Changes may occur in the way the Company processes
personal data in relation to the shareholders. In case these changes oblige the Company to update the data protection information notice, the
Company will bring this to the shareholders’ attention and may do so by any available means such as by email, announcement on the Company’s
website or otherwise. For any data protection inquiries, the shareholders may contact the Company at the following address: 35, boulevard Prince
Henri, L-1724 Luxembourg or by email at: data-protection@reinet.com.
ISBN: 978-9-9987707-0-6
ISSN: 2354-466X
# 18130
Reinet Investments S.C.A. Annual Report at 31 March 2024
www.reinet.com