Audited consolidated financial statements for the period from 1 January 2023 to 31 December 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023
Princess Private Equity Holding Limited
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Cover image is for illustrative purposes only.
Page 2 | Annual Report 2023
Princess Private Equity Holding Limited ("Princess" or the "Company") is a closed-ended investment company domiciled in
Guernsey that mainly provides equity capital to private companies in the middle and upper middle market. The Company is
managed by Partners Group AG ("Partners Group"). Princess primarily accesses investments directly, and to a lesser extent via
Partners Group's private equity programs; Princess also holds a small portfolio of fund investments that is currently in run-off.
Princess aims to provide shareholders with long-term capital growth as well as an attractive dividend yield. The shares are
traded on the Main Market of the London Stock Exchange.
Investment Strategy
• Thematic investing: identification of transformative trends across sectors; investing into attractive companies with clear
development potential;
• Build leading companies through platform building and business transformation;
• Sustainability factors integrated into investment process to drive value creation and mitigate risk.
Managed by Partners Group
• A leading global private markets firm, which has invested over USD 106 billion in private equity across market cycles;
• Over 200 direct private equity professionals, supported by a global network of industry experts and operating directors
with deep industry expertise to help transform portfolio companies;
• Over USD 147 billion in assets under management of which USD 76 billion in private equity.
Assets under management figure as of 31 December 2023, inclusive of all Partners Group affiliates. As of 31 December 2023, USD 106 billion
has been invested in private equity. This includes investments executed for syndication partner investment commitments. The number of
professionals as of 31 December 2023 covering private equity directs includes all members from the respective verticals (Services, Technology,
Health & Life, Goods & Products), regional coverage, and generalist. Source: Partners Group. The ESG factors are in line with the ESG & Sus-
tainability Directive, available on Partners Group website. Though ESG factors may be considered throughout the investment decision process,
it should be noted that ESG is not the predominant strategy of Princess Private Equity Holding Limited.
This document is not intended to be an investment advertisement or sales instrument; it constitutes neither an offer nor an attempt to solicit
offers for the product described herein. This report was prepared using financial information contained in the Company's books and records
as of the reporting date. The charts and figures detailed in the Chair's report, Introduction to the Investment Manager, Private equity market
overview, Investment Manager's report, ESG report, Portfolio composition, Portfolio overview, Structural overview, Company information,
and Board of Directors have not been audited. This report describes past performance, which may not be indicative of future results. The
value of shares and the income from them can go down as well as up as a result of market and currency fluctuations and investors may not
get back the amount they originally invested.
Key figures
31 December 2023
979,245,455
14.16
10.38
0.73
1,029,059,020
9,743,643
121,000,000
105.1%
717,789,124
69,151,168
31 December 2022
1,011,304,037
14.62
8.44
0.38
1,030,070,746
14,850,502
110,000,000
101.9%
583,635,858
69,151,168
In EUR
Net Asset Value ("NAV")
NAV per share
Share price
Total dividend per share
Value of investments
Cash and cash equivalents
Undrawn credit facility
Investment level
Market capitalization
Shares outstanding
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 3
Pastperformanceisnotindicativeoffutureresults.Thereisnoassurancethatsimilarinvestmentswillbemadenorthatsimilarresultswillbe
achieved.Investmentlevel:asperreportingdate,calculatedasvalueofinvestmentsdividedbyNAV.MSCIWorldTR:BloombergNDDUWI
IndexinEUR.Theinclusionofthisindexisusedforcomparisonpurposesonlyandshouldnotbeconstruedtomeanthattherewillnecessarily
beacorrelationbetweentheCompany/investmentreturnandtheindex.TheCompanyisnotmanagednordesignedtotracksuchindex.Last
twelve months' dividends divided by share price as of 31 December 2023.
/70
'LYLGHQG yield based on NAV at 31 December
2022.Diversification does not ensure a profit or protect against loss. Both Princess NAV Total Return and Share Price Total Return start
from31December2013andarescaledto100.7RWDO
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Table of contents
51 Chair's report
92 Introduction to the Investment Manager
3 Private equity market overview 10
4 Investment Manager’s report 11
5 Environmental, Social, and Governance ("ESG") 19
6 Portfolio composition 25
7 Portfolio overview 27
8 Structural overview 30
9 Company information 31
10 Corporate Governance 33
10.1 Board of Directors 33
10.2 Directors' Report 35
10.3 Directors' Responsibilities Statement 43
10.4 Corporate Governance Report 45
10.5 Risk Report 50
11 Independent Auditor's report 54
12 Audited consolidated financial statements 63
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 4 | Annual Report 2023
Strengthening the Board
On 15 February 2024, Axel Holtrup was appointed as a Non-Executive Director. Axel has 20 years of direct private equity
experience at well-regarded investment managers, namely Investcorp, Silver Lake Partners and AEA Investors. He is currently
a non-executive director of Deutsche Beteiligungs AG ("DBAG"), a German listed private equity investment company.
I am also pleased to announce that on 21 March 2024 Gerhard Roggemann was appointed as a Non-Executive Director.
Gerhard has over 40 years' experience in investment banking and in former senior non-executive board roles at leading German
and UK corporates, including F&C Asset Management, Friends Life Group, Fresenius SE and Co, and Deutsche Börse. From
2009 to 2020 he was a non-executive director and then chairman of DBAG.
I would like to thank the other three Board members for their significant time commitment to Princess in the second half of
2023. Fionnuala Carvill took on the role of Interim Chair and is now Chair of the Management Engagement Committee. Merise
Wheatley is Chair of the Audit & Risk Committee, while Henning von der Forst notified the Board in October 2023 that, having
served as a Non-Executive Director since 2012, he intends not to seek re-election at the next Annual General Meeting ("AGM").
I would like to thank Henning for his significant contribution, insight and commitment to the Company over many years. The
Nomination Committee will shortly look at the skills set of the refreshed Board and consider whether a further new Director
would be beneficial.
Proposed new name and enhanced shareholder engagement
The Company's Investment Manager, Partners Group, is one of the largest private equity and private markets investment
managers in the world with approximately USD 147 billion of assets under management. The Investment Manager has an
enviable investment track record of delivering superior returns and has received numerous awards for its investment performance
and industry research. Against this background the Board believes it is important that the relationship with the Investment
Manager is more clearly recognized in the Company's name and that the Company is identifiable as a Partners Group managed
vehicle. Equally, the Investment Manager recognizes that the Company is of significant importance to it as a client and that it
is a "shop window" for its skills and thought leadership to the investor community. To that end, a resolution will be proposed
at the AGM in June 2024 to change the Company's name to Partners Group Private Equity Limited.
The Investment Manager has also undertaken a review of its engagement with the Board and shareholders and the team has
been strengthened by the appointment of Dr. Cyrill Wipfli, former CFO of Partners Group AG and a former member of the
Global Executive Committee, to lead the management team. Working with the Investment Manager, a review has been under-
taken of regular shareholder announcements to improve content and disclosure and changes have already been implemented.
This will be an evolving process over the next year, but shareholders should see improvements to monthly NAV announcements
1. Chair's report
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 5
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PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 6 | Annual Report 2023
and to the forthcoming Annual Report. The Company's website will also be overhauled during the year, as part of a broader
programme of website improvements at the Investment Manager; as an example of simple upgrades the Company's and the
Investment Manager's websites are now linked. Going forward, the Company's website should become a medium for share-
holders to not only view Company information, but also read the broader research, thematic and asset class reviews written
by the Investment Manager.
Finally, the Investment Manager is engaging more with existing and potential shareholders, and the Investment Manager and
the Board are working with the Company's brokers, Deutsche Numis and JP Morgan, to identify and strengthen new and ex-
isting pockets of demand for the Company's shares. I am already directly involved in shareholder and analyst meetings, and I
welcome the opportunity to have discussions with existing and potential shareholders, either formally or informally, over the
coming months.
Capital allocation policy
It is critical for the Board and the Investment Manager to have a clear and robust capital allocation policy. This is not only with
regard to addressing the share price discount to NAV on an absolute and relative basis to peers, but about the fundamental
decision as to whether further investment in the existing portfolio may offer better returns for shareholders than undertaking
new investment. This is particularly apposite when the share price discount is high and any purchase of shares by the Company,
and consequential reduction in the share count, offers an immediate enhancement to NAV, as well as an ongoing return from
further investment in the existing portfolio. The listed private equity sector has struggled historically with capital allocation.
As we hopefully move into an improving private equity environment, with increasing realizations, greater liquidity, and rising
NAVs, it is essential that the right criteria exist for the allocation of capital and that such criteria are transparent, so that existing
and potential shareholders can have confidence in the decisions being made.
Following Board approval, the Company's policy going forward is that:
"Once the share price is at a discount of more than or equal to 30% to the last reported NAV, 75% of "Free Cash Flow" will be used
to acquire issued shares, either for cancellation or to be placed into treasury for potential re-issue, until such time as the discount is
less than 30%. Where the share price is at a discount of more than or equal to 20% to the last reported NAV, but less than 30%, 50%
of Free Cash Flow will be used to acquire issued shares until such time as the discount is less than 20%.
Free Cash Flow is defined as gross cash plus distributions and secondary sales contracted to be received by the Company, less (for
the next rolling 6 months) a provision for:
1. payment of the current dividend objective of 5% of the previous year end NAV;
2. fees, expenses and interest payable in managing and running the Company;
3. the repayment of any drawn debt facilities; and
4. a reserve of 3% of net assets, to cover anticipated cash drawn in respect of existing fund commitments, follow-on funding for existing
direct investments, and new direct investments at an advanced stage where such sums are committed.
The quantum of Free Cash Flow will be calculated at the beginning of each quarter. The above policy is subject to the limits and terms
of the shareholder authority approved at each AGM to buy back up to 14.99% of the Company's shares. The policy will be reviewed
regularly, and at least annually, by the Board and may be amended in light of Company and/or market conditions. Importantly, the
Board reserves the right to undertake share buy backs at discounts of less than 20%."
The policy effectively creates a "cash sweep", where if the Company's shares are trading at more than or equal to a 20% or
30% discount to the last announced NAV, 50% or 75% respectively of Free Cash Flow will be used to undertake share buy
backs in the market. The percentage share price discounts chosen should be seen in the context of the Company's average
share price discount over the last ten years and since listing of 18% and 24% respectively.
Fundamentally, the policy respects the liquidity position and waterfall of the Company. Meeting the Company's dividend ob-
jective of 5% of the previous year-end NAV is at the heart of the Company's new capital allocation policy. As such, the dividend,
as well as ongoing fees, expenses, the repayment of outstanding indebtedness, and a reserve to meet existing investment
commitments, will be provided for prior to excess Free Cash Flow being used for share buy backs.
Critically, the Board continues to have the right, and flexibility, to undertake share buy backs at narrower share price discounts
to NAV than 20% if it so desires.
Share price discount
Over the last two years share price to NAV discounts for most European listed private equity investment companies have
reached their widest level since the period after the Global Financial Crisis. For Princess, the share price discount progressively
narrowed during the year and is currently trading in a discount range of 25-30%. The Association of Investment Companies
reported Princess as one of the best-performing investment companies in share price terms in 2023, but I acknowledge the
rebound was from a low base arising from the reaction to the cancellation of the second dividend payment in late 2022.
I would hope that as a result of the new capital allocation policy, increased shareholder engagement and an improving private
equity environment, Princess' share price discount will narrow further. The Company's share price to NAV discount will be an
important key performance indicator for the Board.
Performance
During the financial year NAV total return was 1.8% (2022: -1.6%), corresponding to a year end NAV of EUR 14.16 (2022:
EUR 14.62) per share. Princess' main currency exposure is to the US dollar, with 43% of the portfolio exposed to the currency
at 31 December 2023. The weakening of the US dollar against the Euro during the year was the main factor in the 0.8%
negative impact of currency movements on the NAV total return. Share price total return for the financial year was 32.6%.
Monetary policies aimed at curbing inflation, geopolitical uncertainties and the uncertainty around an economic slowdown
have hindered global private equity transaction volumes over the last two years. In addition, across the private equity industry
limited capital flows from exits have in turn stifled the number and pace of new investments. Princess has not been immune
from this. Distributions in 2023 were 5% of net assets at 31 December 2022, which was the lowest percentage of distributions
received by the Company since 2000. The Investment Manager expects exit conditions to improve as we move through 2024.
In the meantime, the Company's NAV growth will continue to be supported by a focus on operational performance across the
Company's investments, driven by organic growth, asset transformation and add-on acquisitions. More detail on the portfolio,
performance and diversification can be found in the Investment Manager's Report.
Balance sheet strength
Princess continues to have sufficient liquidity to cover its future investment commitments. Unfunded commitments for the
next 2-4 years are approximately EUR 60-70 million (6-7% of year end net assets). At 31 December 2023 Princess had net
indebtedness of EUR 9 million and EUR 121 million of available liquidity under its EUR 140 million revolving credit facility,
that expires in December 2026. To align Princess with the broader listed private equity universe, the Board agreed for the
Company to discontinue the hedging of currency exposures from 1 April 2023.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 7
Dividend
Dividends paid to shareholders in 2023 amounted to EUR 0.73 per share (2022: EUR 0.38 per share). Going forward, the
Board is acutely aware of the importance of meeting the dividend objective of 5% of the previous year end NAV. The current
share price discount to NAV translates into a prospective dividend yield of circa 6.6%, making Princess one of the highest-
yielding shares in the European listed private equity sector. I believe this dividend yield, coupled with capital appreciation from
a rising NAV, makes Princess an attractive proposition for existing and new shareholders.
Outlook
The Board will continue to focus on delivering on the three short-term objectives I laid out in November 2023 and, as we
move into the second half of 2024, ensuring that, along with the Investment Manager, we have the right resources and terms
under our key agreements to deliver optimal returns for shareholders.
From an investment perspective, higher interest rates and macroeconomic uncertainty have weighed on investment volumes
and valuations. Despite recent improvement in lending activity, capital providers remain highly selective. The positive news is
that any significant improvement in lending markets will likely trigger the release of investment dry powder, which sits at record
highs, and encourage exits. Improving macroeconomic and financial market fundamentals could create attractive vintages re-
sembling those that immediately followed the Global Financial Crisis.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 8 | Annual Report 2023
Peter McKellar
Chair
Princess is managed in its investment activities by Partners Group, a leading private markets investments manager. Partners
Group serves over 800 institutional investors worldwide who seek superior investment performance through private markets
for their beneficiaries. Partners Group has over USD 147 billion in assets under management of which USD 76 billion is in
private equity, and more than 1,900 professionals across 20 offices worldwide. Partners Group creates value in its investments
through active and long-term responsible ownership. Since inception, Partners Group has invested over USD 210 billion in
private equity, private real estate, private debt and private infrastructure on behalf of its clients.
2. Introduction to the Investment Manager
Transformational investing is Partners Group's approach to active business building, and its answer to the large set of oppor-
tunities and challenges in the years ahead. Partners Group has identified three giga themes - Digitization & Automation, New
Living, and Decarbonization & Sustainability - that it believes will drive a substantial reordering of sector compositions and
create ample investment opportunities over the years to come.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 9
3. Private equity market overview
Global private equity market activity
Private equity investment activity experienced muted growth
as concerns about higher interest rates and macroeconomic
uncertainty weighed on investment volumes and entry valu-
ations. Uncertainty around monetary tightening, recessionary
risks, and geopolitical tensions, coupled with the lingering
effects of stress in the banking system in early 2023, made
the cost of borrowing more expensive and credit availability
more selective, ultimately making investments harder to fin-
ance. Nonetheless, the number of transactions rose by 26%
year on year globally to 2,067.
As the year progressed, the environment became more sup-
portive for transactions, including private equity exits, which
started picking up again in the fourth quarter.
Sources: Preqin "Q4 2023 Private Capital Fundraising, Deals/Exits”
Navigating the "brave new world" with
transformational investing
As market dynamics move to a new macro regime, Partners
Group continues to be prudent in its underwriting and driving
business transformations. Its differentiated thematic sourcing
approach, anchored by multi-year in-depth research and a
rigorous selection process, allows Partners Group to secure
high conviction investments at attractive valuations.
Amid challenging investment conditions, Partners Group has
identified digitalization and artificial intelligence ("AI") as
secular growth trends that could drive upside in the mid-
term. Rapid technological advances have the potential to
address structural headwinds, such as a shrinking labor force
and declining productivity, while mitigating inflationary
pressures. Ultimately, the adoption of these disruptive tech-
nologies may lead to a differentiation between winners and
losers.
Partners Group embarked on its thematic journey on digital
transformation over a decade ago, which then materialized
in 2018 with the investment in GlobalLogic. Subsequent
thematic work has facilitated the development of domain
expertise and early involvement with leading digital transform-
ation service providers such as Version 1 and Cloudflight.
Based in Dublin, Ireland, Version 1 provides application
modernization, cloud transformation, and cloud-native soft-
ware development services. Meanwhile, Cloudflight, which
operates mainly in Germany and Austria, provides mission-
critical scalable solutions and tailor-made software and has
deep expertise within fields such as Internet of Things, cloud
architecture, machine learning, and AI. Both investments are
equipped with strong growth profiles, benefitting from long-
term industry demand tailwinds and a robustly expanding
global digital transformation market.
In the current market, Partners Group has adjusted its value
creation plans to accelerate organic growth and enhance
margins, while deprioritizing inorganic growth pressured by
rising interest rates. As the world shifts away from the sup-
portive macroeconomic conditions of the past decade, adopt-
ing a proactive and disciplined investment approach becomes
increasingly imperative. To this end, Partners Group maintains
its unwavering commitment to focusing on value creation,
ensuring margin resilience and protection, and delivering
consistent, solid performance despite the headwinds.
Private Markets Outlook webinar
In the latest Private Markets Outlook webinar, Partners Group
shares its economic and investment outlook as well as trends
and opportunities across its four private markets asset classes
- private equity, private infrastructure, private real estate and
private debt.
Sources: Preqin "Q4 2023 Private Capital Fundraising, Deals/Exits";
Partners Group Research.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 10 | Annual Report 2023
4. Investment Manager’s report
Throughout 2023, companies worldwide faced a challenging
macroeconomic environment marked by persistent inflation-
ary pressures, a reset interest rate landscape, and destabiliz-
ing geopolitical conditions. Despite these headwinds, Partners
Group remained committed to its proven thematic approach
centered on creating value through asset transformation and
business enhancement.
● PCI PHARMA SERVICES
The value of PCI Pharma Services ("PCI"), a global provider
of outsourced pharmaceutical services based in the US, in-
creased during 2023 on the back of continued strong finan-
cial performance, with gains in revenue and EBITDA across
all business segments, including the LSNE injectable unit.
The company maintained strong liquidity and announced
plans for a USD
50 million expansion of its Rockford facility.
It
also announced the full operation of its new advanced
machines in its San Diego and Melbourne facilities. For the
LTM period ending December 2023, PCI's revenue and
EBITDA grew by 19% and 26% respectively.
Within the direct private equity portfolio, over 50 companies
contributed positively to value creation during the year. The
largest three contributors were: PCI Pharma Services, Vishal
Mega Mart and DiversiTech.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
For illustrative purposes only. Numbers may not add up due to rounding. Past performance is not indicative of future results. Value creation
includes interest and dividend income received by Princess.
Annual Report 2023 | Page 11
NAV performance slightly up in 2023
Princess' NAV closed the financial year at EUR 14.16 per
share. Including the total dividend of EUR 0.73 per share
paid to shareholders, this represents a NAV total return of
1.8% for 2023. The FY 2023 dividend payout aligns with the
objective to distribute 5% of previous year-end NAV in semi-
annual payments and translates to an annualized dividend
yield of 7.0% based on the closing share price of EUR 10.38.
Value creation at the portfolio level (+5.7%) played a signific-
ant
role in NAV growth; however adverse currency effects
(-0.8%) claimed back some of the gains. The global economy
demonstrated resilience in 2023 which was accompanied
with corporate margins holding up for much of the year as
companies successfully passed on rising costs. While corpor-
ate margins came under pressure towards the end of the
year as pricing power was challenged, Partners Group's en-
trepreneurial governance and active value creation approach
proved successful in overcoming most obstacles, leading to
noteworthy results for its portfolio companies: Princess' direct
private equity portfolio maintained stable margins and recor-
ded NAV-weighted double-digit year-on-year growth in both
revenue and EBITDA, demonstrating the Investment Man-
ager's ability to deliver value in this "brave new world".
● VISHAL MEGA MART
Vishal Mega Mart ("Vishal"), a franchisor of hypermarket
stores in India, has experienced consistent growth throughout
2023. Notably, the company has been successful in maintain-
ing double-digit like-for-like growth in franchisee stores
across categories, with strong growth in higher-margin appar-
el category, in part due to investments in vendor management
and the introduction of new fashion fits. Supply chain chal-
lenges have persisted in the general merchandise category
and the company has worked with domestic vendors to cre-
ate alternate sources of supply. Partners Group has worked
in close collaboration with Vishal's management team on a
Investment activity
During the reporting period, Princess committed EUR 30
million to Partners Group Direct Equity V fund. The total
capital invested by Princess during the period amounted to
EUR 12 million and includes drawn investments from Partners
Group Direct Equity V fund together with additional follow-
on investments in portfolio companies. While transaction
activity was slower to recover than anticipated in the second
half of the year, the Investment Manager remained focused
on operational value creation initiatives at portfolio compan-
ies and disciplined underwriting.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 12 | Annual Report 2023
● DIVERSITECH
Over
the course of 2023, DiversiTech, a manufacturer of
components and supplies for the US residential heating,
ventilation, and air conditioning ("HVAC") market, experienced
resilient revenue and earnings growth amidst a challenging
macro housing environment. For the LTM period ending
December 2023, the company grew total revenue and
EBITDA by 12% and 16%, respectively, reflecting both organ-
ic growth and the closing of two acquisitions - expanding the
company's reach into a new product category in the US
(thermostats) and its presence in Italy, the largest HVAC
market in Europe. The company, committed to its long-term
transformational strategy, also made significant strides across
relevant value creation projects, including implementing a
new MRP system to drive inventory optimization, as well as
digitally integrating with customers to drive an enhanced
experience and mitigate business errors. The company re-
mains committed to realizing value across several key stra-
tegic pillars over the next few years, which involves enhan-
cing operations and supply chain capabilities, improving the
customer experience, and revamping account and product
line management. Partners Group continues to work with
DiversiTech's board and management to advance its found-
ational initiatives and long-term transformational strategy.
Liquidity
Princess'
cash balance stood at EUR 9.7 million as of year-
end with the Company having drawn EUR 19.0 million of its
EUR 140 million revolving credit facility to meet short-term
liquidity needs. The credit facility is expected to be repaid
with distributions from underlying investments during the
coming quarters.
As of 31 December 2023, the total amount of unfunded
commitments was EUR 115.3 million. We anticipate that
approximately EUR 60-70 million will be funded over the
next two to four years, while the remaining portion is expec-
ted to remain unfunded.
Total investments for 2023
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company's franchisee store footprint and omni-channel of-
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presence across India. Alongside this, Vishal has opened a
new, larger central warehouse to further support its growth
efforts. For the LTM period ending December 2023, Vishal's
revenue and EBITDA grew by 18% and 24% respectively.
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EUR 9.3 million was received from the divestment in Hof-
manns, a provider of premium ready-to-eat frozen meals and
tailored catering services based in Germany. The remaining
proceeds are expected to be released later this year. Founded
in 1960, the company serves business-to-business customers
("B2B") in business canteens, social organizations, such as
schools and kindergartens, and hospitals. Since acquiring
Hofmanns on behalf of its clients in 2014, Partners Group
has supported the company in successfully driving growth
initiatives across its customer segments and investing in tar-
geted production automation initiatives, while still preserving
the hand-made feel of Hofmanns' meal offerings. Key initiat-
ives included streamlining the sales organization by shifting
the focus from regional coverage to customer-centric services
and key account management, repositioning the Hofmanns
brand towards a modern and sustainable pro position,
launching a new business-to-consumer online shop, and di-
gitalizing the customer ordering and internal reporting pro-
cess. Today, Hofmanns supports over 12,000 customers and
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Founded in 1969, Pharmathen is a leading developer of advanced drug delivery technologies such as long-acting injectables,
sustained-release oral solids and preservative-free ophthalmics. The company also has peptide active pharmaceutical ingredient
development and manufacturing. Pharmathen is very well regarded by the broader pharmaceutical industry as an innovative
and forward-thinking company with best-in-class research and development capabilities. It is a mission-critical partner to its
pharmaceutical company customers who want to add high-value pharmaceutical products to their portfolio that also create
real societal impact and optimize treatment outcomes for patients. Pharmathen's differentiated B2B model attracts a blue-chip
customer base of more than 200 pharmaceutical companies, which it serves from three US/EU-approved manufacturing facil-
ities in Greece. The company's highly diversified product portfolio of c. 80 commercialized products is accessed by patients
in more than 85 countries worldwide.
Sourcing
Partners Group has been tracking advanced contract development and manufacturing organizations ("CDMOs") since 2016
via specific thematic research which identified in the pharmaceutical industry the lack of in-house capabilities and capacity as
well as the need for speed-to-market and efficiency gains by outsourcing certain drug development and manufacturing capab-
ilities. Partners Group acquired Pharmathen from investment firm BC Partners in 2022 at an enterprise value of around EUR
1.6 billion.
Value creation
As an entrepreneurial owner, Partners Group's mission has been to support Pharmathen in becoming a globally leading CDMO
by drawing on its deep sector expertise in pharmaceutical services, as well as its experience in state-of-the-art manufacturing,
to support the development of innovative technology platforms as it expands operations to meet increasing demand for affordable
generics.
In particular, Partners Group has supported the accelerated expansion in the US, by building out its presence and overseeing
Food and Drug Administration ("FDA") approval and launch of five high value products, with more in the pipeline. Partners
Group's entrepreneurial governance has also changed the board mix from "investors only" to one with five independent oper-
ating directors. In addition, Partners Group supported the build-out of an M&A team and project management office which
have supported Pharmathen's first ever acquisition. The acquisition of CBL Patras adds vertical integration synergies and ac-
cretive capabilities in peptide therapeutics. All this is positioning Pharmathen for long-term, sustainable growth, building a drug
development powerhouse that is a trusted partner to blue-chip clients worldwide and makes a positive impact on the lives of
people.
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Founded in 2012 and headquartered in London, Forterro operates a portfolio of 14 ERP software brands, serving over 13,000
customers in industrial end markets by providing them with mission-critical software to run their daily operations. The company's
software products offer functionality specific to various industrial sub-verticals, which has differentiated its solutions from
competitors and fostered a highly loyal customer base. Forterro's deep domain expertise allows it to provide customers with
highly configured solutions, which cater for their specific operational requirements. The company has over 1,600 employees
across its European offices and global development centers. The SMB ERP software market benefits from structural tailwinds
driven by long-term digitization trends and is expected to experience attractive growth in the coming years. Forterro's strong
portfolio of brands and geographic reach position it well to capitalize on this growth.
Sourcing
Through its thematic research, Partners Group ascertained the European ERP software market to be a high-conviction space,
due to attractive characteristics such as high growth with a long tail of local competitors. Within this space, Forterro was
tracked since 2020, having been identified as a leading ERP software provider within its focus segments. Partners Group acquired
Forterro from Battery Ventures in 2022 at an enterprise value of EUR 1 billion.
Value creation
Since investing, Partners Group has been working with management to further expand Forterro's platform across Europe. Key
initiatives include accelerating organic growth through specific go-to-market initiatives and the development of new Cloud
offerings, as well as improving operational efficiency and making strategic acquisitions in adjacent geographies and sub-verticals.
Forterro's transformational growth potential stems from the increasing importance of software to allow companies to digitize
every aspect of their business to remain competitive. Forterro's high customer retention rates reflect the deep entrenchment
of its products in the customer's daily processes. Forterro is a long-term partner to its clients and can serve them in a way
many larger providers cannot replicate due to superior functionality at a lower price point than large generalists, whose products
are often too complex and costly for SMB industrial companies. With Partners Group support, Forterro's organic growth has
been complemented by the acquisition and integration of additional ERP solutions, tapping into Partners Group's resources
and expertise in scaling up technology platforms.
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Founded in 1971 and headquartered near Atlanta, Georgia, DiversiTech is North America's largest manufacturer of HVAC
equipment pads and a leading manufacturer and supplier of HVAC components and related products. It is credited with devel-
oping the first transportable HVAC pad. The company has a broad product portfolio of c. 30,000 stock keeping units across
seven product families, including HVAC equipment mounting, electrical & replacement parts, condensate management and
indoor air quality. DiversiTech has c. 1,250 employees across locations in the US, Canada, and Europe.
Sourcing
Partners Group tracked DiversiTech through its thematic investing approach having built a strong conviction in the future
growth prospects of the HVAC industry given the expanding customer base for residential installations of HVAC units and
the associated recurring demand for the company's essential parts and supplies. Partners Group acquired DiversiTech from
Permira in 2021 at an enterprise value of USD 2.2 billion.
Value creation
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mercial HVAC services in the US.
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initiatives such as accelerating new product development, expanding through M&A to increase the company's geographic
footprint in the European market, bolstering internal manufacturing capabilities, and transforming processes to facilitate a best-
in-class customer experience.
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5. Environmental, Social, and Governance ("ESG")
The Company shares and is aligned with the purpose, culture, and values adopted by Partners Group in their charter and as
given in their Sustainability Report.
Partners Group has a strong commitment to sustainability. Creating lasting positive results is one of the core principles of its
charter and one that applies to all its activities as a firm. It guides its investment activities, its corporate activities and its daily
interactions with all stakeholders. Additional information can be found on Partners
Group website.
Partners Group's commitment to responsible investment is embedded in the company's charter, a document that defines the
essence of the firm and reflects who they are and what they do, every day.
Partners Group's commitment to responsible investment is longstanding. The Sustainability Team reviews on a continuous
basis the most recent industry ESG frameworks and standards, while its Corporate Development team assesses corporate
level sustainability initiatives. The team then selects and supports initiatives it considers to be industry-leading and contributing
to an increase in know-how of sustainability considerations for our transformational investing approach, or on the corporate
level which helps Partners Group Holding adhere to the highest sustainability oversight and governance standards.
Partners Group has a long-standing experience in sustainability
Source: Partners Group (2023). For illustrative purposes only. Although ESG factors may be considered throughout the investment decision
process, it should be noted that ESG is not the predominant strategy for Partners Group programs. Shown milestones are deemed relevant
for Partners Group's sustainability strategy. 1 Source: EQS news "Partners Group included in the Dow Jones Sustainability Indices 2021"
https://www.eqs-news.com/news/corporate/partners-group-included-in-the-dow-jones-sustainability-indices-2021/1488342
Partners Group's ESG vision, objectives, and strategy
Partners Group aims to realize potential in private markets and create sustainable returns with a lasting, positive impact for all
its stakeholders, in line with its fiduciary duty and return-generating goals. Appropriate consideration of ESG & sustainability
factors in investment activities can be a key enabler of value creation for Partners Group on behalf of its clients and other
stakeholders.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 19
Partners Group's Sustainability Strategy
The Sustainability Strategy articulates the vision of building better and more sustainable assets and companies, while also
creating positive and lasting impact for all its stakeholders. To achieve this dual vision, the firm has defined clear ESG ambitions
for both the firm and portfolio. For the Partners Group directly controlled assets in the Princess portfolio, Partners Group de-
termined a set of targets.
The first target is to establish an ESG governance framework within the first 100 days of acquisition. This includes appointing
ESG responsibility at board, executive, and leadership levels and establishing a Risk & Audit Committee. During the first two
years of ownership, Partners Group's investee companies are tasked with developing a meaningful ESG Journey. The ESG
Journey at Partners Group is a framework that helps its portfolio companies to continuously improve their ESG performance.
It enhances project implementation, data quality, and industry comparability. The ESG Journey at Partners Group is informed
by due diligence and is applied throughout the ownership period of the asset. At exit, the ESG Journey allows the team to assess
Partners Group's impact on sustainability for a given investment, aiming to leave it with a robust approach and strategy for
sustainability topics.
On the environmental side, Partners Group's focus area is to guide its assets to develop a tailored greenhouse gas ("GHG")
reduction strategy. The first target is for the portfolio companies to measure their GHG footprint within one year of ownership,
have it externally assured within two years, and ultimately conduct a materiality assessment to analyze their environmental
footprint beyond GHG emissions. This serves the purpose of setting up the portfolio of controlled assets to reduce GHG
emissions by 2035.
Partners Group's social focus lies on the initiation of a stakeholder benefits program and the development of a tailored Employee
Engagement Initiative within two years of ownership. Over the ownership period, Partners Group develops a Diversity & In-
clusion Strategy with the portfolio companies to assist teams in reflecting the local talent pools of the societies in which they
operate.
Progress against these targets is regularly reviewed and assessed at the investment's board meetings. The asset manager's
investment teams feed this information back into the engagement strategy via the semi-annual transformational ownership
review. Meeting the Sustainability Strategy targets is increasingly embedded into the investment's board members' compens-
ation packages.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 20 | Annual Report 2023
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Founded in 1980, Wedgewood is the largest specialty provider of customized compounded medications for animals experiencing
acute and chronic conditions, and employs more than 700 people in the US. Headquartered in New Jersey, with additional
sites in Arizona, California and Colorado, the company's geographical reach is extensive. The sophistication and flexibility of
specialty pharma players like Wedgewood provide additional treatment options for veterinarians, pets and their owners. The
company maintains 66,000 relationships with veterinarians and serves over 360,000 pet owners annually. During the past
year, the company has demonstrated strong enthusiasm and progress in further ESG objectives, with a dedicated executive
and steering ESG team (COO/President, CHRO, Safety Manager, Pharmacist, Finance, Marketing).
On the environmental side, Wedgewood has completed its Scope 3 footprint assessment for 2022, ensuring that its environ-
mental impact is measured and aligns with its GHG reduction objectives. The company also identified sustainable materials
and packaging alternatives, including foam pack inserts, ice bricks, coolers, vials, and autobags or plastic bags, demonstrating its
commitment to eco-friendly practices.
Moreover, waste and cost reduction measures are implemented in the Arizona and New Jersey operations and energy efficiency
audits are ongoing in California. Wedgewood is cooperating with Partners Group portfolio companies Budderfly and VelocityEHS
to bolster their sustainability initiatives and implement an environmental management system. Budderfly's analysis suggests
new solar and HVAC/LED units can achieve a total GHG emissions reduction for the New Jersey operations by -57.1% and
-30.6% for the business total.
Regarding the social perspective and in particular Health & Safety, Wedgewood Pharmacy has met its goals for recordable
incidents through July 2023 and completed over 95% of its Active Shooter training and EHS Leads have been identified at all
Blue Rabbit Operations locations. Furthermore, they have participated in community initiative California's 2nd Harvest food
bank volunteering. In addition, the company is currently developing its employee handbook to implement a more inclusive
employment strategy. Consequentially, they are revising all job descriptions and partnering with VelocityEHS to review their
process.
Finally, from a governance perspective, their draft Corporate Health & Safety Policy is currently pending review and approval.
They have strengthened cybersecurity measures with the implementation of two-factor authentication for OneDrive access,
and all users within the company must now acknowledge and adhere to the Acceptable Use Policy. In their ongoing commitment
to sustainability, they are diligently integrating the marketing and research and development departments for a collaborative
approach to sustainable packaging initiatives. Additionally, they are expanding their ESG team to advance their ESG Journey
by focusing on multiple aspects, such as enhanced cybersecurity measures.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 22 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
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Annual Report 2023 _ 3DJH
541,039,884
The portfolio's holdings are ranked by percentage of net asset value. Some figures (marked "n.a.") may not be disclosed for confidentiality
reasons. Furthermore, some investments have been made through Partners Group pooling vehicles at no additional fees. The portfolio overview
of Princess has been prepared on a look through basis, although the audited consolidated statement of financial position includes the valuation
of certain Partners Group investment vehicles. Residual cost is the total investment cost net of distributions from such an investment until
the end of the reporting period. Negative residual costs (receipt of distributions > investment cost) will result in an amount of zero.
8. Structural overview
Princess Private Equity Holding Limited is a Guernsey re-
gistered private equity holding company founded in May
1999 that invests in private market investments. In 1999
Princess raised USD 700 million through the issue of a con-
vertible bond and invested the capital by way of commit-
ments to private equity partnerships. The convertible bond
was converted into shares in December 2006. Concurrently,
the investment guidelines were amended and the reporting
currency changed from the US dollar to Euro. The Princess
shares were introduced for trading on the Frankfurt Stock
Exchange (trading symbol: PEY1) on 13 December 2006 and
on the London Stock Exchange (trading symbol: PEY) on 1
November 2007. Princess consolidated all trading activity to
the London Stock Exchange on 6 December 2012 and ceased
being listed on the Frankfurt Stock Exchange.
On 6 September 2017, the Company announced the inten-
tion to introduce an additional market quote in Sterling
(trading symbol: PEYS) for its existing ordinary shares on the
London Stock Exchange, alongside the Company's existing
Euro market quote. The purpose of the introduction of the
Sterling quote was to broaden the potential ownership of
the Company's ordinary shares. Following the introduction
of the Sterling quote, which was admitted for trading on 8
September 2017, shareholders have the option to make a
dividend currency election to receive dividends in Sterling.
For the avoidance of doubt, all dividends continue to be de-
clared in Euros and the default currency for dividend pay-
ments remains Euros.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
1 100% owned by Partners Group Holding AG, Switzerland
2 Partners Group investment programs are on a net no fee basis and only Princess' fees apply, i.e. no double fee layer
3 A portfolio of primary and secondary investments that are in wind-down and no new commitments to 3rd party funds will be made in the
future
Page 30 | Annual Report 2023
Fund investments: interests in private investment funds acquired from other investors (secondary investments) or through a commitment to
a new fund (primary investments)
Princess aims to provide shareholders with long-term capital
growth and an attractive dividend yield. The Company's in-
vestments are managed on a discretionary basis by Partners
Group. The Investment Manager is responsible for, inter alia,
selecting, acquiring, and disposing of investments and carrying
out financing and cash management services.
Partners Group is a global private markets investment man-
agement firm with USD 147 billion in investment programs
under management, of which USD 76 billion is in private
equity. Through the Investment Management Agreement,
Princess benefits from the global presence, size, and experi-
ence of the investment team.
9. Company information
Partners Group (Guernsey) Limited
Tudor House
Le Bordage
St. Peter Port
Guernsey GY1 1BT
Channel Islands
Administrator
PricewaterhouseCoopers CI LLP
Royal Bank Place 1 Glategny Esplanade St Peter Port Guernsey, GY1 4ND
Channel Islands
Auditor
(Chair-appointed23November2023)
(ChairoftheAuditandRiskCommittee)
(ChairoftheManagementEngagement
Committee)
(appointedpostyearend:15February2024)
DSSRLQWHGSRVW\HDUHQG0DUFK
didnotseekre-electionatJune2023AGM
PeterMcKellar
MeriseWheatley
FionnualaCarvill
HenningvonderForst
AxelHoltrup
*HUKDUG5RJJHPDQQ
PastDirectors
Richard Battey
Steve Le Page
Felix Haldner
Board of Directors
Aztec Financial Services (Guernsey) Limited
East Wing, Trafalgar Court
Les Banques
St Peter Port
Guernsey, GY1 3PP
Channel Islands
Company Secretary
EuroCurrency denomination
Dividends
Incentive fee
1999Incorporation
Partners Group AG
Zugerstrasse 57
CH-6341 Baar-Zug
Switzerland
Investment Manager
princess@partnersgroup.comInvestor Relations
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 31
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Joint corporate brokers
London Stock ExchangeListing
1.5% p.a. of the higher of NAV or value of Princess' assets less any temporary
investments plus unfunded commitments. With effect from 1 July 2020
unfunded commitments in respect of Primary and Secondary investments are
excluded.
Management fee
Princess Private Equity Holding Limited
Tudor House
Le Bordage
St. Peter Port
Guernsey GY1 1BT
Channel Islands
Registered office
Fully paid-up ordinary registered sharesSecurities
Guernsey company, authorized closed-ended fund in GuernseyStructure
Trading symbol (Euro Quote): PEY
Bloomberg (Euro Quote): PEY LN
Reuters (Euro Quote): PEY.L
Trading symbol (Sterling Quote): PEYS
Bloomberg (Sterling Quote): PEYS LN
Reuters (Sterling Quote): PEYS.L
ISIN (Euro and Sterling Quote):
GG00B28C2R28
WKN (Euro and Sterling Quote):
A0M5MA
Trading information
Each ordinary shareholder is entitled to one vote per ordinary share heldVoting rights
www.princess-privateequity.netWebsite
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 32 | Annual Report 2023
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10. Corporate Governance
10.1 Board of Directors
Peter McKellar (appointed 23 November 2023)
Peter McKellar was appointed as a Director and the Non-Executive Chair of the Board with
effect from November 23, 2023. He has extensive experience in the asset management, in-
vestment company and private equity sectors. He is currently a Non-Executive Director of
3i Group plc, the Deputy Chairman of AssetCo plc, a Non-Executive Director of Investcorp
Capital plc, and a Board Member of Scottish Enterprise. He was formerly Global Head of
Private Markets at Abrdn plc, where he oversaw £55 billion of assets under management,
before which he led Standard Life Investments' private equity and infrastructure business and
was their Chief Investment Officer. During his time at Standard Life Investments Peter led the
listing in 2001 and was then lead manager of Standard Life Private Equity Trust (now called
Abrdn Private Equity Opportunities) until 2015. Prior to that, he held a variety of finance
posts in industry and corporate finance positions. Peter holds an LLB (Hons) from
Edinburgh University and is a UK resident.
Fionnuala Carvill (appointed 1 September 2018)
Fionnuala Carvill is a Guernsey resident and a Chartered Fellow of The Chartered Institute
for Securities & Investment; a Fellow of the London Institute of Banking & Finance (Chartered
Institute of Bankers); a Fellow of The Chartered Governance Institute and a Chartered Gov-
ernance Professional. Ms Carvill is a Non-Executive Director of Investec Bank (Channel Islands)
Limited, Fair Oaks Income Limited, and The Chartered Institute for Securities & Investment
Future Foundation. Previous executive positions held include Managing Director of Kleinwort
Benson (Channel Islands) Investment Management Limited; Director of Kleinwort Benson
(Channel Islands) Limited; Commission Secretary and Head of Innovation at the Guernsey
Financial Services Commission; and Director of Rothschild Bank (CI) Limited. Ms Carvill is a
former board member of The Chartered Institute for Securities & Investment; a past President
and committee member of The Chartered Institute for Securities & Investment, Guernsey
Branch; a Liveryman of the Worshipful Company of International Bankers; and was granted
Freedom of the City of London in 2007. Ms Carvill sits on the board of several charities,
holding roles from funding and capacity building to governance and impact assessment. She
previously volunteered with Voluntary Service Overseas ("VSO") where she took the role of
Organizational Development Advisor during a placement with the Environment Development
Center of a university in the People's Republic of China, aiming to support program delivery,
aid capacity building and develop knowledge of governance and fundraising. Ms Carvill holds
a Master's degree in Corporate Governance (Distinction).
Henning von der Forst (appointed 13 November 2012)
Henning von der Forst is a German resident and has over twenty-five years' experience at
Board level in insurance, banking and asset management. In addition to his directorship of
Princess Private Equity Holding Limited, he is a Member of the Supervisory Board of various
investment trusts and investment companies in Germany. Previously he served as a Member
of the Executive Board of Directors as Chief Investment Officer of Nuremberger Insurance
Group. There he was responsible for the Asset Management, Banking Services and Treasury,
Investor Relations and International Relations from 1992 until his retirement in 2015. Prior
to this, he worked as a marketing manager at SBCI Swiss Bank Corporation Investment
Banking, London, and as Head of the Group Treasury and Finance Department with VIAG
Aktiengesellschaft, Bonn (E.on today). He holds a Master's degree in business administration
from the University of Münster.
Annual Report 2023 | Page 33
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Merise Wheatley (appointed 1 September 2018)
Merise Wheatley is a Guernsey resident and has over 30 years' experience at Board level in
risk financing and insurance management. She is a Fellow of the Association of Chartered
Certified Accountants, having completed her training with Abbey Life Assurance and National
Mutual Life Association of Australasia in the UK, and qualified in 1982. In addition to her
directorship of Princess Private Equity Holding Limited, Merise serves as a director on the
Boards of a number of non-listed regulated insurance entities in Guernsey. From 1988 until
June 2019 Merise worked for a number of leading insurance management service providers
in Cayman, Guernsey, and Malta, including Artex Risk Solutions, Heath Lambert, Marsh and
Johnson Higgins, providing strategic and operational insurance management services and
serving as executive director to a portfolio of client insurance companies. Merise is a past
Chairman of the Guernsey International Insurance Association. In 2007 she achieved the
Diploma in Company Direction awarded by the UK Institute of Directors.
Axel Holtrup (appointed 15 February 2024)
Axel Holtrup is a seasoned private equity investor with more than 25 years of investment
experience. He is also an early stage technology investor and serves as a member of the Su-
pervisory Board of Deutsche Beteiligungs AG ("DBAG"), a German listed private equity
company. Previously he worked over the course of 20 years as a partner in private equity
firms AEA Investors, Silver Lake Partners and Investcorp. His responsibilities included sourcing,
executing and managing major private equity transactions across Europe. Axel started his
career in investment banking at Morgan Stanley in 1995. Axel holds a Bachelor (Hons)
degree in European Business Administration from Middlesex University in London and a
Diplom Betriebswirt from from Reutlingen University in Germany. He is a German national who
resides in the UK.
Gerhard Roggemann (appointed 21 March 2024)
Gerhard Roggemann is a German resident. He was appointed to the Board in March 2024
and also serves as a board member for the Else-Kroener-Fresenius Foundation, is Deputy
Chair of the Supervisory Board for Bremer AG, and he is an independent business consultant,
based in Hanover, Germany. Gerhard's professional experience includes serving as a non-ex-
ecutive director and later as Chair of the Supervisory Board of Deutsche Beteiligungs AG
("DBAG"), a Frankfurt-listed private equity firm focused on German mid-market buyouts
(2009-2020). He has also been a non-executive director of a number of prominent
German and UK companies, including Deutsche Boerse AG, Fresenius SE & Co KGDA,
Friends Life Group Plc, F&C Asset Management Plc and Resolution Ltd Guernsey.
Gerhard previously worked in senior management positions at JP Morgan & Co,
Norddeutsche Landesbank and WestLB. In all these functions his responsibilities centered
around investment banking, trading, and investment management.
Page 34 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Board appointments made after 31 December 2023:
10.2 Directors' Report
The Directors present their report and audited consolidated financial statements of Princess Private Equity Holding Limited
for the period from 1 January to 31 December 2023.
The Board, roles, and committees
At 31 December 2023, the Board consisted of four directors, all of whom are non-executive. Ms. Carvill assumed the respons-
ibilities of Chair from Mr. Battey, serving in the capacity of Interim Chair from 23 June 2023 until 22 November 2023. Com-
mencing on 23 November 2023, Mr. McKellar is appointed as the Non-Executive Chair of the Board. As Chair, he is responsible
for leading meetings of the Board to ensure that they are efficient and effective, promoting the long-term sustainable success
of Princess Private Equity Holding Limited (the "Company"), generating value for shareholders (as disclosed in the Strategy
section), and contributing to wider society.
Mr. von der Forst has notified the Board that he intends not to seek re-election at the next AGM scheduled to be held in June
2024 and the Nomination Committee has undertaken a recruitment process to appoint new directors.
At each quarterly board meeting, the Directors consider several reports and performance indicators to assess the Company's
success in achieving its objectives. These include:
• Monitoring of the share price (and associated premium or discount);
• General performance reporting at the underlying investment level;
• Cash flow projections;
• Risk management and adherence to investment guidelines;
• Broking and shareholder analysis reports, including peer group comparisons;
• Reports from committees, together with the monitoring, evaluation, appointment, and removal of service providers;
• Approval of financial statements and dividends; and
• Corporate governance and compliance.
In addition, the consent of the Board is required if the Investment Manager wishes to borrow more than 30% of the value of
the Company's assets, lend or pledge any of the Company's assets (other than in the context of a hedging transaction), enter
into an investment or other transaction with affiliates of the Investment Manager, or invest more than 10% of the value of
the Company's assets into any single investment.
Furthermore, the Board confirms that it considers any conflicts or potential conflicts of interest in accordance with the Company's
existing procedures.
Committees of the Board
Audit
& Risk Committee
The Audit & Risk Committee ("A&R Committee") meets at least three times a year and has been chaired by Ms. Wheatley since
23 June 2023 after she succeeded Mr. Le Page in the role. The Board is satisfied that at least one member of the A&R Com-
mittee has recent and relevant financial experience, and that the committee has the skills and experience required to fulfill its
responsibilities. The A&R Committee is responsible for ensuring that the financial performance of the Company is properly
reported on and monitored. It provides a forum through which the Group and Company's Independent Auditor may report to
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 35
the Board. Furthermore, it ensures that any reports issued by the Board present a fair, balanced, and understandable assessment
of the Company's position and prospects. The A&R Committee reviews the annual and semi-annual accounts, results, announce-
ments, internal control systems and procedures, and accounting policies of the Company. It also considers the performance
and quality of the external audit and makes appropriate recommendations to the Board concerning the Independent Auditor.
The A&R Committee is also responsible for monitoring the risks and their potential impact on the Company.
The Group's and Company's Independent Auditor is PricewaterhouseCoopers CI LLP. The A&R Committee is responsible for
reviewing the independence and objectivity of the Independent Auditor and ensuring this is safeguarded notwithstanding any
provision of any other services to the Group or Company. The Board of Directors recognizes the importance of safeguarding
auditor objectivity and has taken the following steps to ensure that auditor independence is not compromised:
• The A&R Committee carries out an evaluation each year of the Independent Auditor as to their independence from the
Group and Company and relevant officers of the Group and Company, and that they are adequately resourced and tech-
nically capable of delivering an objective audit to shareholders. Based on this evaluation, the A&R Committee recommends
to the Board the continuation, removal, or replacement of the Independent Auditor.
• The A&R Committee gives careful consideration before appointing the auditor to provide other services. These other services
are generally limited to work that is closely related to the annual audit (such as regulatory and statutory reporting) or where
the work is of such a nature that a detailed understanding of the Group's and Company's business is necessary (such as
assistance on tax or regulatory matters). Such services will however be assessed on a case-by-case basis so that the best-
placed adviser is retained. Where the auditor is engaged to provide additional services, the auditor, in providing these
services, utilizes different teams. The Independent Auditor did not provide any non-audit services during the year.
• The A&R Committee reviews the Independent Auditor's confirmation of their independence in accordance with Crown
Dependencies' Audit Rules and with Securities and Exchange Commission ("SEC") Independence Rules. In addition to the
steps taken by the Board to safeguard auditor objectivity, PricewaterhouseCoopers CI LLP operates a five-year rotation
policy for audit engagement leaders on listed companies such as the Company.
• PricewaterhouseCoopers CI LLP has remained in place as auditor for a considerable number of years and the audit contract
has never been put out to tender. As the Company is not a FTSE 350 company, the external audit contract is not required
to be put out to tender at least every ten years. The A&R Committee remains convinced of the benefits to the Company
and Group of using the same auditor as Partners Group uses for its other funds, These benefits include cost savings, a
much higher testing rate of the valuations of assets than would otherwise be achievable at the cost, and a more detailed
knowledge by the auditors of Partners Group's systems and processes than would otherwise be the case. During the year,
Partners Group completed an external audit tender process and recommended that PwC should be reappointed as auditor
to its other products. Following the 2024 AGM, the A&R Committee will consider if PricewaterhouseCoopers CI LLP
continues to meet certain key criteria - competence, resources, independence, and cost - and determine whether to recom-
mend to shareholders that they are reappointed as Independent Auditor of the Company for the period ending 31
December 2025.
In addition, the terms of reference for this committee are available on the Company's website www.princess-pri-
vateequity.net/en/about-princess/committees/. The significant areas considered by the A&R Committee during the year were:
• Valuation of private investments − the A&R Committee pays particular attention to this area at each meeting date, and
members of the Board discuss the approach both during those reviews and during the annual visit to the Investment
Manager. Significant valuation movements are challenged, and disposals are compared to the most recent valuation. Whilst
this area is easily the most significant for the financial statements, it is also well understood and subject to an established
process, including checks and balances at the Investment Manager, as well as to challenge by the A&R Committee and
the Independent Auditor. On this basis, the A&R Committee has concluded that the valuation of private investments is fair
and reasonable for inclusion in the audited consolidated financial statements.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 36 | Annual Report 2023
• Incentive fees are a significant area of the financial statements because of their nature rather than their size. Their calculation
is also somewhat complex, being accrued on an investment-by-investment basis in the Company, but often on a "whole
fund" basis by underlying vehicles. At each meeting, the Board reviews a schedule of fees accrued and paid, comparing it
to the valuation gains recognized on the investments, and the A&R Committee has discussed the accounting for these fees
with both the Investment Manager and the Independent Auditor. On this basis, the A&R Committee has concluded that
the incentive fees are fair and reasonable for inclusion in the audited consolidated financial statements.
• Presentation and disclosure - the A&R Committee reviewed in detail the form and content of this annual report and also
of the published interim report. The objective of the review, in both cases, was to ensure that all applicable regulations
and standards were adhered to, that the disclosure given was adequate and not misleading, and that the reports were
consistent with the A&R Committee' s knowledge of the Group's activities during the relevant period. As a consequence
of this review and their other work, the A&R Committee was able to conclude that those reports were fair, balanced and
understandable, and therefore to make appropriate recommendations to the Board for their approval and publication.
Although the Directors believe that the Company and the Group have a robust framework of internal control in place, this can
only provide reasonable and not absolute assurance against material financial misstatement or loss and is designed to manage,
not eliminate, risk. In addition, the Board recognizes the importance of a sound risk management framework to safeguard the
Company's assets, protect the interests of the shareholders, and meet its responsibilities as a listed company.
The A&R Committee approaches its risk review by covering both qualitative and quantitative matters.
The A&R Committee identifies the principal risks as being those with the greatest likelihood and impact of all those risks assessed
as being relevant to the Company and Group. Risks are grouped into (i) investment risk, (ii) shares trading at a discount, (iii)
financial risk, (iv) governance risk, (v) regulatory risk, (vi) operational risk, (vii) macro-economic and other external risks and (viii)
valuation risk. For each of these risks the A&R Committee evaluates how these risks could arise, assigns responsibility to control
and mitigate such risks, and determines the post-mitigation likelihood and impact of the risk occurring. The A&R Committee
makes decisions and requests additional reporting based on these findings.
On an annual basis, the A&R Committee reviews certain quantitative reports covering foreign currency exchange risk, interest
rate risk, liquidity risk, market price risk, and counterparty risk as disclosed in the notes to the audited consolidated financial
statements. On an annual basis the Board of Directors meets with the internal audit team of Partners Group Holding AG to
discuss the upcoming internal audit plan, covering those controls assigned to Partners Group Holding AG and its affiliated
entities, and the material results or findings of any reports for the previous period that affect the Company or the Group. Ad-
ditionally, the Board of Directors is provided, annually by the end of April, with a copy of the Internal Controls report assured
by PricewaterhouseCoopers AG in accordance with the International Standard on Assurance Engagement 3402 "Assurance
reports on controls at a service organization". This information allows the Board of Directors to assess and monitor the risks
associated with the services delegated to Partners Group and to seek clarification or updates.
The risk management framework includes a sound system of internal controls that is designed to:
• identify and appraise all risks related to achieving the Company's objectives and principal risks;
• manage and control risk appropriately rather than eliminate it;
• ensure the appropriate internal controls are embedded within the business processes performed by service providers and
support the Company's culture which emphasizes clear management responsibilities and accountabilities;
• respond quickly to evolving risks within the Company and the external business environment; and
• include procedures for reporting any control failings or weaknesses to the appropriate level of management together with
the details of corrective action.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 37
Management Engagement Committee
The Management Engagement Committee ("ME Committee") meets at least annually and was chaired by Ms. Wheatley from
23 June 2023, succeeding Mr. Le Page in the role. Subsequently, Ms. Carvill assumed the role of Chair on 23 November 2023,
following Ms. Wheatley. The ME Committee is responsible for reviewing and monitoring service providers and recommending
to the Board their continued appointment. Key service providers are reviewed on an annual basis. The Board recognizes the
importance of monitoring service providers' objectivity and ensuring their independence is not compromised.
In this regard, with respect to the appointment of the Investment Manager, the ME Committee:
• considers if there are any potential conflicts of interest associated with the appointment of the Investment Manager and
how the Investment Manager manages these potential conflicts;
• reviews with the Investment Manager any material issues arising from their work that the Investment Manager wishes to
bring to the attention of the ME Committee, whether privately or otherwise;
• reviews the performance of the Investment Manager both in terms of its delivery against the agreement governing its ap-
pointment and in terms of its delivery against the objectives of the Company.
Similar considerations are taken into account in the ME Committee's review of all other service providers to the Company. In
addition, the terms of reference for this committee are available on the Company's website http://www.princess-pri-
vateequity.net/en/about-princess/committees/.
Nomination
Committee
The Nomination Committee ("NM Committee") was established on 23 June 2023, under the chairmanship of Ms. Carvill.
Subsequently, Mr. McKellar assumed the role of Chair of the Committee on 23 November 2023 following his appointment
as Chair of the Company. The Committee is set to meet at least once per annum, in accordance with the Company's reporting
and auditing cycles, or as necessary. The NM Committee actively contributes to the Board's efficacy by examining its structure,
size, and composition, and providing pertinent recommendations. Also, the Committee focuses on succession planning,
identifying qualified candidates for director roles, and assessing the Board's balance of skills and experience.
The NM Committee undertakes several essential duties, including:
• Systematically examining the Board's structure, size, and composition, while considering the requisite skills, knowledge,
and experience. The Committee subsequently proposes suggestions for improvements to the Board;
• Thoroughly evaluating succession plans for directors, keeping in view the challenges and opportunities faced by the
Company, and subsequently determining the essential skills, knowledge and expertise needed by future Board members;
• Leading the process, facilitated by an independent external search consultancy, of identifying and nominating suitable
candidates for filling Board vacancies, with these nominations subject to the Board's endorsement as vacancies emerge.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 38 | Annual Report 2023
The following table is an extract of the various Directors' attendance at Board and Committee meetings for 2023 compared
against those for which they were eligible:
Committees
NMMEA&RAd-hocBoardName
0/00/0N/A0/00/0P. McKellar (Chair)*
2/21/13/32/311/11F. Carvill
N/A1/13/31/311/11H. von der Forst
2/21/13/33/311/11M. Wheatley
N/A0/01/13/36/6R. Battey**
N/A0/01/13/36/6S. Le Page**
N/AN/AN/A0/36/6F.Haldner**
*Peter McKellar was appointed as a director with effect from 23 November 2023 and became a member of the ME Committee and Chair of the NM Committee with effect from
the same date.
**Richard Battey, Steve Le Page and Felix Haldner did not stand for re-election at the Company's 2023 AGM held on 23 June 2023.
Board composition
Number of senior positions on
the Board (CEO, CFO, SID,
Chair)
Percentage of the
Board
Number of Board
Members
Not applicable - see note*67%4Male
33%2Female
Number of senior positions on
the Board (CEO, CFO, SID,
Chair)
Percentage of the
Board
Number of Board
Members
Not applicable - see note*100%6White British or other
White (including minority-
white groups)
*This column is inapplicable as the Company is externally managed and does not have executive management functions, specifically it does not have a CEO or CFO. The Company
considers that the roles of Chair, chair of the Audit & Risk Committee and chair of the Management Engagement Committee are senior positions. Of these three senior roles, two
are performed by women and one by a man.
The Board seeks to address ethnic diversity, through Board succession planning. Applicants will however continue to be assessed
without prejudice on their range of skills, expertise, and industry knowledge, and on their business and other experience. The
diversity of the Board is further considered on at least an annual basis through the Board evaluation process.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 39
The Board has a breadth of experience relevant to the Company and a diversity of skills, experience, nationality and age. Its
members collectively possess the broad range of skills, expertise, industry knowledge, and other experience necessary for the
effective oversight of the Company's business. The Board is committed to gender diversity, and at present is constituted with
33% females and 67% males. Once Mr. von der Forst steps down at the June 2024 AGM the Board will revert at that point
to 40% females and 60% males. Additionally, the Audit & Risk Committee and the Management Engagement Committee, key
permanent sub-committees within the Company's governance structure, are both chaired by females and the Company has
followed the AIC guidance on reporting such. This composition demonstrates the Company's commitment to diversity and
inclusion, while also satisfying two critical components of the listing requirements.
In view of the nature, scale and complexity of the Company the Board has not developed a formal diversity policy, but the
Company shares and is aligned with the purpose, culture, and values adopted by Partners Group in their charter and as given
in their Corporate Sustainability Report and acknowledges the diversity and inclusion initiatives of Partners Group whose teams
fulfill the executive management and operating functions of the Company.
Partners Group, as a whole, continued to hire talented professionals from across the globe with growth in its employee base
to 1,951 employees in 2023 (2022: 1,856). Today, Partners Group's professionals represent around 70 different nationalities
and speak around 40 (2022: 30) different languages. The percentage of female and male employees in 2023 remained at
similar levels to 2022 (around 41% female and around 59% male). Partners Group has meaningfully increased the number of
senior female employees and Board Members in 2023 and aspires to continue our successful progress.
Partners Group's hiring process is designed to ensure that all candidates are measured and benchmarked against the same
criteria, and to avoid any form of discrimination, with all hiring managers required to take unconscious bias training and with
the goal of successfully attracting and hiring more female talent by ensuring that women are adequately represented within
our initial hiring talent pool.
The Directors have resolved to put themselves forward for election on an annual basis and Ms. Carvill, Ms. Wheatley and Mr.
von der Forst were all duly re-elected at the 2023 annual general meeting. Mr. von der Forst has notified the Board that he
intends not to seek re-election at the next AGM scheduled to be held in June 2024.
Re-election recommendations have always been subject to an assessment of the respective Director in question, their objective
and independent thought process, knowledge of the Company, and continued satisfactory performance. In view of the long-
term nature of the Company's investments, the Board believes that a stable and diversified board composition is fundamental
to running the Company properly. The Board's Tenure Policy limits the tenure of any director to a maximum term of nine years
unless the Board, having assessed the continued independence and suitability of an individual, unanimously agrees that they
should be nominated to serve more than nine years and discloses the rationale for their reappointment to the Shareholders
in the notice for the next Annual General Meeting. The Board continues to be satisfied with the contribution of each of the
Directors, and that they have each maintained their independent perspective.
Given the recent changes in the Board, a separate Nomination Committee was formed to lead recruitment of a new Chair and
other Board members. Due to the size of the Company, the Board did not deem it necessary to form a separate remuneration
committee.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 40 | Annual Report 2023
Strategy
Strategic objectives
The Company's investment objective is to provide shareholders with long-term capital growth and an attractive dividend yield,
through investment in a diversified portfolio of private equity investments, rather than through third-party fund investments.
In addition, the Investment Manager has a goal to achieve a long-term sustainable impact on the companies in which it invests,
their underlying clients, and the wider environment in which they operate.
The Investment Manager of the Company is Partners Group AG (the "Investment Manager"). The Investment Manager seeks
to achieve a long-term sustainable impact by working in partnership with the management and employees of the companies
in which the Company invests and through active entrepreneurial ownership initiatives with clear goals and continuous mon-
itoring.
In addition, the Investment Manager works with portfolio companies on a variety of ESG engagements. This commences during
the investment due diligence phase and, after acquisition, the Investment Manager implements initiatives by systematically
integrating ESG factors, alongside commercial and financial factors.
The Investment Manager continuously monitors the effectiveness of any ESG-relevant policies through maturity assessments
to evaluate progress and impact.
As part of its annual review of the Investment Manager, the Board obtains an overview of the value creation initiatives, including
ESG initiatives, on the underlying investments, and a detailed progress report on the monitoring of risk and impact on valuations.
Review of performance
The Board undertakes an annual evaluation of its own performance and the performance of its committees and individual
Directors, to ensure that they continue to act effectively and efficiently, to fulfill their respective duties, and to identify any
training requirements. During this evaluation, the Directors also reconfirmed that they continue to be able to allocate sufficient
time to the Company in order to discharge their responsibilities, to provide constructive challenge and strategic guidance, to
offer specialist advice, and to hold third-party service providers to account. In view of the relatively recent appointment of
the new Chair, the Board has determined that the first full evaluation of his performance will be undertaken in Q4 2024.
Viability statement
The Directors confirm that they have a reasonable expectation that the Group will continue to operate and meet its liabilities,
as they fall due, for the next three years. The Group's viability testing considers multiple severe, yet plausible, stress scenarios.
The Directors' assessment has been made with reference to the Group's current position and prospects, the Group's strategy,
the Board's risk appetite, and the Group's principal risks and how these are managed. The Directors consider this is an appro-
priate period to assess the viability of an investment company for the purposes of giving assurance to shareholders, as eco-
nomic factors are very difficult to forecast over a longer period.
The strategy and associated principal risks underpin the Group's three-year plan and scenario testing, which is reviewed by
the Directors on a quarterly basis. The three-year plan is built on an investment-by-investment basis using a bottom-up approach.
The three-year plan makes certain assumptions about the development of underlying investments, in terms of future expected
capital calls and distributions, potential future investments, and the ability to refinance debt when required. The plan is built,
monitored, and updated quarterly based on any changes to expected cash flows and forward-looking assumptions, which help
to drive the model and to determine when to make new investments.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 41
The three-year plan review is underpinned by the regular Board briefings provided by the Investment Manager, including dis-
cussions around liquidity reporting and risk management reports undertaken by the Board of Directors in its normal course of
business. These reviews consider both the market opportunity and the associated risks, principally the ability to realize invest-
ments at their fair value and secure new investments while maintaining sufficient working capital. These risks are considered
within the Board of Directors' risk appetite framework.
Based on the Company's processes for monitoring, anticipating, and managing cash flow, operating costs, share price discount,
the Investment Manager's compliance with the investment objective, asset allocation, the portfolio risk profile, gearing, coun-
terparty exposure, and liquidity risk, the Directors have concluded that there is a reasonable expectation that the Company
will continue in operation and meet its liabilities as they fall due over the three-year period to 31 December 2026.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 42 | Annual Report 2023
10.3 Directors' Responsibilities Statement
Directors' duties and responsibilities
The Board meets at least quarterly, and it is the duty of each Director to inform the Board of any potential or actual conflict
of interest prior to a Board discussion. Representatives of the Investment Manager attend board meetings. The Company's
corporate brokers also attend to assist the Directors in understanding the views of major shareholders regarding the Company.
The Board of Directors has overall responsibility for the Company's affairs and is responsible for the determination of the in-
vestment policy of the Company, resolving conflicts and monitoring the overall portfolio of investments of the Company. To
assist the Board in the operations of the Company, arrangements have been put in place to delegate authority for performing
certain day-to-day operations of the Company to the Investment Manager, and other third-party service providers, such as
the Administrator and the Company Secretary. Although the Board meets formally at least four times a year, the Investment
Manager and Company Secretary stay in more regular contact with the Directors on a less formal basis. These formal and in-
formal discussions allow the Directors to constructively challenge and assist in the development of strategy. Individual Directors
have direct access to the Company Secretary and may, at the expense of the Company, seek independent professional advice
on any matter that concerns them in the furtherance of their duties.
The Directors are responsible for preparing financial statements for each financial period that give a true and fair view, in ac-
cordance with applicable Guernsey law and International Financial Reporting Standards, of the state of affairs of the Group
and Company, and of the profit or loss of the Group and Company for that period. In preparing those financial statements,
the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and estimates that are reasonable and prudent;
• state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained
in the financial statements; and
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and
Company will continue in business.
So far as the Board of Directors are aware,
• there is no relevant audit information of which the Group and Company's auditor is unaware, and
• each Director has taken all the steps that he or she ought to have taken as a director in order to make himself or herself
aware of any relevant audit information and to establish that the auditor is aware of that information.
The Directors confirm that they have complied with the above requirements in preparing the audited consolidated financial
statements. The Directors of the Company have elected to prepare audited consolidated financial statements for Princess
Private Equity Holding Limited for the period ended 31 December 2023 as the parent of the Group in accordance with Section
244(5) of The Companies (Guernsey) Law, 2008. They are not required to prepare individual accounts for Princess Private
Equity Holding Limited for the financial period in accordance with Section 243 of The Companies (Guernsey) Law, 2008.
To the best of their knowledge and belief:
• The Annual Report, which includes information detailed in the Chairman's report, the Investment Manager's report, the
Directors' report, and the notes to the audited consolidated financial statements, includes a fair review of the development
and performance of the business and the position of the Company together with a description of the principal risks and
uncertainties that the Company faces, as required by Financial Conduct Authority's Disclosure Guidance and Transparency
Rules ("DTR") 4.1.8 and DTR 4.1.11; and
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 43
• The audited consolidated financial statements, prepared in accordance with International Financial Reporting Standards,
give a true and fair view of the assets, liabilities, financial position, and profit or loss of the Company.
As the Company is not incorporated in the UK it is not required to comply with DTR 9.8.6 (8) and it has not set out climate-
related financial disclosures consistent with the recommendations provided by the Task Force on Climate-related Financial
Disclosures ("TCFD").
The Directors are responsible for keeping proper accounting records that disclose with reasonable accuracy at any time the
financial position of the Group and Company and enable them to ensure that the audited consolidated financial statements
comply with The Companies (Guernsey) Law, 2008. They are also responsible for safeguarding the assets of the Group and
Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
The maintenance and integrity of the Group and Company website are the responsibility of the Directors. The work carried
out by the Independent Auditor does not involve consideration of these matters and, accordingly, the Independent Auditor
accepts no responsibility for any changes that may have occurred to the audited consolidated financial statements after they
were initially presented on the website. Legislation in Guernsey governing the preparation and dissemination of financial
statements may differ from legislation in other jurisdictions.
On behalf of the Board
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 44 | Annual Report 2023
Peter McKellar
Chair
22 March 2024
10.4 Corporate Governance Report
The Directors have determined to report against the Principles and Provisions of the Association of Investment Companies
("AIC") Code as endorsed by the Guernsey Financial Services Commission ("AIC Code"), dated February 2019. The AIC Code
is available on the AIC website www.theaic.co.uk/aic-code-of-corporate-governance/
. In assessing the Board's corporate
governance practice for 2023, the Directors confirm that throughout the period the Company complied with the provisions
of the AIC Code. The Company has complied with the relevant provisions of the UK Corporate Governance Code (the "UK
Code") as issued by the Financial Reporting Council and dated July 2018, except as set out below:
• The role of the Chief Executive;
• The role of the Senior Independent Director;
• Executive Directors' remuneration;
• The need for an internal audit function and the monitoring and reviewing of the effectiveness of such a function.
For the reasons set out in the AIC Code, and in the preamble to the UK Code, the Board considers these provisions are not
relevant to the position of the Company, being an overseas investment company with an appointed Investment Manager.
There are no executives with contractual obligations directly with the Company and thus the Executive Directors' remuneration
rules do not apply. The A&R Committee and the Board of Directors regularly consider the risk and operational aspects of the
Company. The Board has access to the appointed Compliance Officer of the Administrator who reports quarterly. As there is
delegation of operational activity to appointed service providers, the A&R and ME Committees and the Board have determined
there is no requirement for a direct internal audit function, although they do have access to and meet with the internal audit
function of Partners Group Holding AG.
The Guernsey Financial Services Commission has a standing Finance Sector Code of Corporate Governance that was amended
in July 2023 (the "Guernsey Code"). In the introduction to the Guernsey Code, it states: "Companies which report against the
UK Corporate Governance Code or the Association of Investment Companies Code of Corporate Governance are deemed to
meet this Code." As a company listed on the London Stock Exchange the Company is subject to the Disclosure Rules, the
Transparency Rules, and the UK Code but uses the AIC Code instead as it is a member of AIC and considers this appropriate
for an investment company and that it provides information that is more relevant to shareholders. As an AIC member domiciled
in Guernsey which reports against the AIC Code, the Company is not required to report separately against the Guernsey Code.
AIFMD
In July 2014, the European Alternative Investment Fund Management Directive ("AIFMD") came into effect. At present, the
Board considers that the Company falls outside the scope of this Directive, in that the number of its shares in issue is static
or declining, and accordingly it does not market new shares inside the European Union. In the event that the Company seeks
to raise capital, it will reconsider this.
Directors, directors' interests, and directors' remuneration report
The Directors of Princess Private Equity Holding Limited are as shown on page 33. As at 31 December 2023, the Directors
had no beneficial interest in the share capital of the Company other than as shown below:
P. McKellar (Chairman): 30,000 shares
G. Roggemann: 771,867 shares
M. Wheatley: 5,000 shares
No service contract or arrangement existed in the period in which any of the Directors has an interest. The Board considers
all the Directors as independent of the Investment Manager and free from any business or other relationship that could ma-
terially interfere with the exercise of their independent judgement or create potential conflicts of interest.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 45
Directors' remuneration is presented in the notes to these audited consolidated financial statements and is shown below. Mr.
Haldner did not receive a fee for the provision of his services as a director of the Board. Directors' remuneration was split as
follows in Euro:
(31.12.2023 / 31.12.2022)
P. McKellar (Chairman) (10,685 / n/a)
F. Carvill (76,500 / 55,000)
H. von der Forst (55,000 / 55,000)
M. Wheatley (73,000 / 55,000)
Richard Battey (34,000 / 68,000)
Steve Le Page (30,500 / 61,000)
Additional fees of €15,000 each were agreed by the rest of the Board to be paid to Ms. Carvill and Ms. Wheatley in respect
of their work on the Nomination Committee in the recruitment of the new Chair and other Board members.
It should be noted that the amount presented for Mr. Battey and Mr. Le Page for 2023 pertains to their tenure as Directors
for the period to June 2023. The sole director of Princess Private Equity Subholding Limited, which held office during the
period, was Princess Private Equity Holding Limited.
Directors' and officers' liability insurance
The Company maintains insurance in respect of Directors' and Officers' liability in relation to their acts on behalf of the Company.
Suitable insurance is in place and due for renewal on 6 February 2025.
Purpose, culture, and values
The Company shares and is aligned with the purpose, culture, and values adopted by Partners Group (which includes the In-
vestment Manager and Administrator) in their charter and as given in their Corporate Sustainability Report, both of which are
available at their website www.partnersgroup.com/en/about-us/our-impact/responsible-investment
.
The Company's mission is to develop companies and assets which it invests in through entrepreneurial ownership. This stems
largely from the belief that the ability to create value, enabled by a governance framework that supports entrepreneurialism,
is the key driver of the returns.
In summary, investments are managed with a long-term perspective to the benefit of individuals and societies worldwide and
the investment teams leverage the global Partners Group integrated platform to systemically engage with entrepreneurs and
corporate leaders to create value in the investments. In addition, the investment teams liaise with management in underlying
companies in constructive dialogue and have open debates, while in parallel taking their fiduciary duty to all stakeholders into
account.
Partners Group is fully committed to investing clients' capital in a responsible manner by integrating ESG factors, alongside
commercial and financial factors, into investment due diligence and ownership.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 46 | Annual Report 2023
Major developments in the year
At the annual general meeting ("AGM") held in June 2023, Mr. Battey resigned as Chairman of the Board along with Mr. Le
Page and Mr. Haldner. The remaining board members were re-elected. Subsequent to the AGM, Ms. Carvill served as Interim
Chair while the recruitment process was undertaken, and Mr. McKellar joined the Board as Non-Executive Chair, effective
from 23 November 2023.
On 23 June 2023, a Nomination Committee was formed with the objective of strengthening the Board's composition and
managing succession planning to maintain leadership consistency within the Company. An independent external search con-
sultancy was subsequently appointed to facilitate the recruitment process.
Furthermore, the Board consulted with shareholders and mutually agreed to discontinue the foreign exchange hedging strategy
effective from 1 April 2023. This decision aligns the Company with its peers and is expected to bolster the cash position of
the Company.
Annual general meeting
The Directors propose a separate resolution on each substantial issue tabled at the AGM, including the approval of the consol-
idated financial statements, and publish on the Company's website www.princess-privateequity.net/en/investor-relations/fin-
ancial-reports/, shortly after the AGM, details of the valid proxies received, votes for and against and withheld in relation to
each resolution. No resolution at the 2023 AGM received more than 32.74% votes against the Board recommendation. The
vote of 32.74% against the Board recommendation was in respect of the reappointment of Mr. von der Forst, which the Board
understood related to his extended tenure. The Company informed shareholders in the Regulatory News Service dated 30
October 2023 that Mr Henning von der Forst intends not to seek re-election at the next AGM scheduled to be held in June
2024.
Shareholder information
The net asset value and the net asset value per share are calculated (in Euro) every month at the last business day of each
month by Partners Group (Guernsey) Limited, acting as Administrator. The net asset value is calculated in accordance with
International Financial Reporting Standards, which require the Company's direct investments and fund investments to be valued
at fair value. Thereafter, it is announced by the Company on its website and submitted to a regulatory information service
approved by the UK Listing Authority as soon as practicable after the end of the relevant period.
Dividends
Two dividends of EUR 0.365 each per share were declared on 19 April 2023 and 27 October 2023 and were paid on 2 June
2023 and 15 December 2023, respectively. This compares to a dividend of EUR 0.380 per share, being declared on 4 May
2022 which was paid on 17 June 2022. Since the December 2017 dividend, shareholders have been able to also elect to get
their dividends paid in Sterling or to elect to participate in the Dividend Reinvestment Plan, although this does not result in
the issuance of any new shares.
Substantial interests
The European Union Transparency Directive requires substantial shareholders to make relevant holding notifications to the
Company and the UK Financial Conduct Authority. The Company must then disseminate this information to the wider market.
Those shareholders who have declared accordingly that they held above 5% of ordinary shares, as at the period end, were:
• Asset Value Investors Limited - 10.04%
• Deutsche Asset Management Investmentgesellschaft - 7.66%
• Bayer-Pensionskasse VVaG - 7.56%
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 47
• Société Générale Option Europe - 5.31%
• Rathbone Brothers - 5.26%
• CVP / CAP Coop - 5.07%
This information has been prepared based on disclosures made by shareholders to the Company in accordance with stock
exchange rules.
Share capital
Although the shareholders granted authorization to the Directors to make market acquisitions of ordinary shares, the Company
purchased and redeemed / canceled no shares (31 December 2022: nil) during the year.
There was no change in the issued and paid-up share capital as at 31 December 2023 and 31 December 2022. Accordingly,
the paid-up share capital as at 31 December 2023 was 69,151,168 ordinary shares of EUR 0.001 each (31 December 2022:
69,151,168 ordinary shares of EUR 0.001 each).
There are no restrictions regarding the transfer of the Company's securities, no special rights with regard to control attached
to the Company's securities, no agreements between holders of the Company's securities regarding their transfer known to
the Company, and no agreements to which the Company is party that might be affected by a change of control following a
takeover bid.
Results
The results for the period are shown in the audited consolidated statement of comprehensive income.
Key information document
Partners Group AG is required to produce and publish the key information document for packaged retail and insurance-based
investment products. The key information document is available on the Company's website www.princess-privateequity.net/en/in-
vestor-relations/kid/ and is subject to an annual review by the Board.
Registered office
Tudor House
St. Peter Port
Guernsey
GY1 6BD
Incorporation
The entities of the Group are incorporated and domiciled in Guernsey, Channel Islands.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 48 | Annual Report 2023
Investment management arrangements
The Company has entered into an Investment Management Agreement with Partners Group AG (the "Investment Manager").
Details of the management fees are shown within the audited consolidated financial statements. The Investment Management
Agreement automatically renews every two years but contains a two-year notice period. Termination will be without penalty
or other additional payments, save that the Company will pay management and incentive fees due and additional expenses
incurred. The Directors have determined that the appointment of the Investment Manager, on the terms of the Investment
Management Agreement, is aligned with the interests of shareholders as a whole, given the global reach and expertise of the
Investment Manager.
Going concern
The Group closely monitors its future anticipated cash flows and, based on these forecasts and the sensitivities which have
been run on different scenarios, the Directors have a reasonable expectation that the Group and Company have adequate
resources to continue in existence for at least the next twelve months. For this reason, they continue to adopt the going
concern basis in preparing the accounts.
Company secretary
The secretary of the Company, as at 31 December 2023, was Aztec Financial Services (Guernsey) Limited.
Independent auditor
At a general meeting held on 23 June 2023, PricewaterhouseCoopers CI LLP was re-appointed Independent Auditor of the
Company for the period ended 31 December 2023, and the Directors were authorized to fix their remuneration.
P. McKellar
Director
M. Wheatley
Director
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 49
22 March 2024
10.5 Risk Report
Risks
The Board is responsible for managing and overseeing risk and reviews and assesses quarterly the impact of risks that it considers
apply to the Company that may compromise the achievement of the Company's strategic objectives. These risks encompass
the significant risks to which the Company may be exposed, including the macro environment and uncertainties in respect of
the valuation of unquoted investments, and their impact on the cash flow modeling employed by the Company. Notes 4 and
17 of the audited consolidated financial statements provide further comment on certain other risks connected with the invest-
ments and financial assets / liabilities held by the Company and how they are managed.
Statement of principal risks
The major risks to which the Company may be exposed are ranked by a risk index, considering both likelihood and impact.
When assessing the likelihood and potential impact of such risks, the Board considers whether the outcome could pose:
• an immediate threat to the existence of the Company;
• a medium-term threat (resulting in the Company being placed into run-off);
• a reputational threat from which the Company could be expected to recover fully in due course; or
• no immediate threat to the Company or its operating activities.
The risks are split into eight main sections: (i) investment risk, (ii) shares trading at a discount, (iii) financial risk, (iv) governance
risk, (v) regulatory risk, (vi) operational risk, (vii) macro-economic and other external risks and (viii) valuation risk.
The Company's share price discount has improved compared to its peers during 2023 following improved communication with
investors, achieving the dividend target and the appointment of a new Chair. The development and implementation of a cap-
ital allocation policy and additional strong Board appointments in 2024 are expected to reduce further the risk of the Company's
share price discount trailing behind its peer group.
Liquidity risk has stabilized following the discontinuation of currency hedging in April 2023 and the increase in the credit facility
to EUR 140 million, but it remains a principal risk which is closely monitored in view of the potential impact of low levels of
exits and distributions on the dividend and capital allocation policies.
Following the discontinuation of hedging of foreign exchange risks, given that a significant proportion of the portfolio is de-
nominated in currencies other than Euros, information on underlying currencies is provided to investors to allow those who
prefer a hedged exposure to apply their own hedging.
The departure of three directors in June 2023 led to an increase in governance risk in respect of the Board composition, and
the remaining Board members initiated as a first priority the necessary measures to identify and recruit a successor Chair and
additional Non-Executive Directors as soon as practicable. Significant progress has been made, as evidenced by the appointments
outlined in the Directors' Report.
The Board also continues to assess the impact of ESG factors on the Company's key risks, primarily within the context of the
Investment Manager's ESG framework which seeks to embed ESG into the strategy, direction and goals of portfolio companies
and to quantify the impact of its initiatives.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 50 | Annual Report 2023
In its assessment, the Board considers that none of the risks present an immediate threat to the existence of the Company
and has, in each case, worked with the Investment Manager, Administrator, Company Secretary, or broker to ensure that adequate
measures are in place to mitigate the occurrence and impact of these risks. The Board also obtains regular reporting so that
these risks can be continuously assessed.
Although the Ukraine/Russia and Middle East conflicts increase the level of geo-political risk, the Company has negligible direct
exposure to these regions but, with the Company's Investment Manager, the Board continues to closely monitor the situation,
taking into account potential supply chain disruptions and second order effects. The Board has not identified any other
emerging risks that could have a significant impact on the Company.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 51
Principal Risks for 2023 Annual Report
K
Key risk Assessment Potential impact Control exercised by the Board
Company’s shares trading at a
material discount compared to
peers
Reducing
The risk is assessed as reducing
following enhanced Board
communication with investors, leading
to implementation of a capital allocation
policy alongside recommitment to the
dividend policy and delivery of
the succession plan set out in June
2023.
Decline in shareholders' mark-to-
market valuation and impact on
demand from shareholders and
prospects.
Monitoring of investor sentiment &
expectations with significant
communication directly between
directors and investors in respect of
succession planning and strategy.
Monitoring of performance vs. peers.
Maintenance of good market
communication.
Implementation and monitoring of
effectiveness of capital allocation policy .
Liquidity risk - lack of availability
of funding to take up investment
opportunities, meet funding and
other obligations as they fall due,
and pay dividends when declared.
Stable
Liquidity risk has stabiliz
ed following the
discontinuation of currency hedging and
increase in credit facility but it remains a
principal risk in view of the potential
impact of low levels of exits and
distributions on the dividend and capital
allocation policies.
Insufficient cash to fund existing
commitments and dividends.
Factors impacting liquidity, including
distributions and potential exits being
kept und
er close review for medium and
long term cashflow forecasts to ensure
capital allocation policy leaves adequate
funding for existing commitments and
dividends. Renegotiation
and increase of
credit facility to ensure adequate short-
term funding available.
Poor investment performance on
an absolute and relative basis
Stable
Modest slowdown in growth rates within
portfolio companies due to macro
conditions but strong ongoing
performance. Private market
transaction
levels are expected to return to a more
normal level in 2024 and the Investment
Manager will be able to plan for
investment in suitable new
opportunities, subject to the Company's
capital allocation policy.
Adverse movement in net asset
value versus peer group.
Effectiveness of investment strategy
reviewed at every board meeting using
performance reports and discussions
with brokers and Investment Manager.
Medium and long term cashflow
forecasts being kept under close review
to ensure level of new investment
commitments is maximized in line with
capital allocation policy subject to
adequate funding for existing
commitments, dividends and share
buyback allocation.
Governance risk - Board
composition does not provide for
effective functioning of Board and
confidence of shareholders
Reducing
This risk was assessed a s increased
following the outcome of the AGM and
the departure of three Board members
in June 2023 but the risk has been
reduced with the appointment of a new
permanent Chair and additional
directors appointed in 2024 in line with
a structured succession plan.
Inadequate direction & oversight,
poor decision making, loss of
shareholder confidence.
Nomination Committee formed June
2023. New Chair appointed November
2023 and other appointments in Q1
2024 will ensure Board has
full range of
skills and experience.
Valuation risk - under or
overstating the valuations of
private market investments
Stable
This risk was assessed a s stable because
the valuation approach was stable. In
periods such as 2023 with an industry-
wide reduced investment/exit activity
leading to a reduced number of private
comparables. Using mainly public
comparables as the default for the mark
-
to-market valuations enables a
consistent approach.
Reputational risk and impact on
share price.
Policies and tools used to determine
valuations have been challenged and this
remains a significant area for review by
the Independent Auditor.
ESG risks (including climate
change)
Stable
The impact of ESG factors on the
Company's key risks continues to be
assessed, primarily within the context of
the Investment Manager's ESG
framework, which seeks to embed ESG
into the strategy, direction, and goals of
portfolio companies and to quantify the
impact of its initiatives. The risk is
assessed as stable given the maturity of
the Investment Manager's ESG
integration process.
Unsuitable investments leading to
adverse impact on valuations, the
environment and society or breach
of ESG regulations.
Regular reporting by Investment
Manager on their ESG strategy and
initiatives and Board training to enable a
good understanding of ESG reporting.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 52 | Annual Report 2023
S
Stakeholder disclosures
The Company is an externally managed investment company, has no employees, and as such is operationally quite simple. The Board
does not believe that the Company has any material stakeholders other than those set out in the following table.
Investors
Service providers
Community and environment
Issues that matter to them
Performance and liquidity of the shares
Growth and liquidity of the Company
Reputation of the Company
Compliance with law and regulation
Remuneration
Informed stewardship of the
environments in which the Company
operates and acting as a good corporate
citizen
Compliance with law and regulation
Impact of the Company and its activities
on third parties
Engagement process
Annual General Meeting (see detail below)
Frequent meetings with investors by
brokers, the Investment Manager, the
Chair and other Directors
and subsequent
reports to the Board
Monthly factsheets and regular news
releases
Key Information Document
Quarterly briefings by the Investment
Manager via telephone conference which
are attended by at least one Board member
who briefs the remainder of the Board
Annual and semi-annual financial
statements
The two main service providers – Partners
Group and Aztec – engage with the Board
in face-to-face meetings quarterly, giving
them direct input to Board discussions.
The Board also considers the views of its
corporate brokers and interests of its
credit facility lender at each of its meetings.
All key service providers are asked to
complete a questionnaire annually (others
on a rotation basis) which includes
feedback on their interaction with the
Company, and the Board undertakes an
annual review of Partners Group in
Switzerland.
The Company itself has only a very
small footprint in the local community
and only a very small direct impact on
the environment.
However, the Board acknowledges that
it is imperative that everyone
contributes to local and global
sustainability.
The Investment Manager has an ESG
framework which is a key element of
the investment process which overlays
throughout the portfolio.
Rationale and example outcomes
Clearly investors are the most important
stakeholder for the Company. Increased
shareholder engagement has been a
priority following the suspension of the
second dividend in the previous year and
the departure of several directors at the
AGM, to inform investors of the progress
of new Board appointments and to ensure
that the Board is aware of larger investors’
views on Board composition and the
dividend and capital allocation policies.
In addition, the Board has focused on
valuation of assets, a key priority for
shareholders, thus ensuring a robust and
reliable methodology is applied.
The Company relies on service providers
entirely as it has no systems or employees
of its own.
The Board always seeks to act fairly and
transparently with all service providers,
and this includes such aspects as prompt
payment of invoices.
The nature of the Company’s
investments is such that they do not
provide a direct route to influence
investees in ESG matters in many areas,
but the Board has made its views in this
area clear to Partners Group, which, on
behalf of the Company and other
investors, works closely with investee
companies to promote ESG issues as
well as financial performance. Further
details are set out elsewhere in this
document and on the Partners Group
website.
Board members do travel, partly to
meetings in Guernsey, and partly
elsewhere on Company business,
including for the annual due diligence
visit to Switzerland. The Board
considers this essential in overseeing
service providers and safeguarding
stakeholder interests. Otherwise, the
Board seeks to minimize travel by the
use of video conferencing whenever
good governance permits.
Engagement processes are kept under regular review. Investors and other interested parties are encouraged to contact the Company via
the Investor Relations contacts given on page 104.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 53
11. Independent Auditor's report
Report on the audit of the consolidated financial statements
Our opinion
In our opinion, the consolidated financial statements give a true and fair view of the consolidated financial position of Princess
Private Equity Holding Limited (the "company") and its subsidiaries (together "the group") as at 31 December 2023, and of
their consolidated financial performance and their consolidated cash flows for the year then ended in accordance with IFRS
Accounting Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards") and have been
properly prepared in accordance with the requirements of the companies (Guernsey) Law, 2008.
What we have audited
The group's consolidated financial statements comprise:
• the audited consolidated statement of financial position as at 31 December 2023;
• the audited consolidated statement of comprehensive income for the year then ended;
• the audited consolidated statement of changes in equity for the year then ended;
• the audited consolidated statement of cash flows for the year then ended; and
• the notes to the audited consolidated financial statements, comprising material accounting policy information and other
explanatory information.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing ("ISAs"). Our responsibilities under those
standards are further described in the Auditor's responsibilities 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.
Independence
We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the consolidated
financial statements of the group, as required by the Crown Dependencies' Audit Rules and Guidance. We have fulfilled our
other ethical responsibilities in accordance with these requirements.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 54 | Annual Report 2023
Our audit approach
Overview
Audit scope
• We have conducted a full scope audit of the consolidated financial statements of the group.
• The company and its subsidiaries are incorporated in Guernsey. The consolidated financial statements are a consolidation
of the company and the underlying subsidiaries.
• Our approach is designed to address the risk of material misstatement and is tailored to consider the investment objectives
of the group.
• In establishing the overall approach to the group's audit, we determined the type of work that needed to be performed by
us or by our supporting team from another PwC network firm.
Key audit matters
• Valuation of unlisted investments
• Calculation of incentive fees
Materiality
• Overall group materiality: €22.0 million (2022: €22.7 million) based on 2.25% of net assets.
• Performance materiality: €16.5 million (2022: €17.0 million).
The scope of our audit
As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the consolidated
financial statements. In particular, we considered where the directors made subjective judgements; for example, in respect of
significant accounting estimates that involved making assumptions and considering future events that are inherently uncertain.
As in all of our audits, we also addressed the risk of management override of internal controls, including among other matters,
consideration of whether there was evidence of bias that represented a risk of material misstatement due to fraud.
Key audit matters
Key audit matters are those matters that, in the auditor's professional judgement, were of most significance in the audit of the
consolidated financial statements of the current period and include the most significant assessed risks of material misstatement
(whether or not due to fraud) identified by the auditor, including those which had the greatest effect on: the overall audit
strategy; the allocation of resources in the audit; and directing the efforts of the engagement team. These matters, and any
comments we make on the results of our procedures thereon, 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.
This is not a complete list of all risks identified by our audit.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 55
Key audit matter How our audit addressed the key audit matter
Valuation of unlisted investments
Refer to the Basis of preparation (note 2),
the Principal accounting policies (note 3) and
notes 4, 9, 13, 16, 18 and 19 to the
consolidated financial statements.
The group has an investment portfolio
consisting of listed and unlisted investments.
The unlisted investments are split between
direct and indirect investments. The
valuation of the portfolio of unlisted
investments is significant in assessing the
financial position and performance of the
group and is an area to which significant
judgement is often applied and estimates
made by the directors.
The unlisted investments are valued using
such methodologies and modeling
techniques considered most appropriate by
the directors in order to comply with IFRS 13
Fair Value Measurement.
The inputs to these valuations include:
Direct Investments
● Applying a market-derived multiple
to the earnings of the underlying
investment; or
● Applying a discount rate to the
future cash flows of the underlying
investment; or
● Using third party valuations of the
underlying investment.
Indirect Investments
● Using a share of the net asset value
received from the general partners
of the underlying investment funds.
Determining both the valuation methodology
and the inputs to the valuation of unlisted
investments can be subjective and complex.
This, combined with the significance of the
unlisted investments to the consolidated
statement of financial position, means that
the valuation of unlisted investments was
considered a key audit matter for audit
purposes.
We updated our understanding and evaluation of management's processes and internal
controls in so far as they apply to the valuation of unlisted investments, the valuation
methodologies and modeling techniques used and the areas where significant judgements and
estimates are made. We also performed tests over certain key internal controls used in the
valuation of unlisted investments in order to assess their operating effectiveness.
The unlisted investments consist primarily of private companies (“direct investments”) or
investments in funds (“indirect investments”) and are initially valued by Partners Group AG (the
"Investment Manager"), reviewed by the Valuation Committee at Partners Group AG and
subsequently presented to the directors for review, challenge, and approval.
Where appropriate, auditor’s experts were used in the execution of our testing. For a sample of
investments, we performed the following testing:
Methodology
We assessed the appropriateness of the valuation methodology applied by the Investment
Manager, including the availability of representative market data to be able to apply an
earnings multiple model. Where a discounted cash flow model was used we evaluated that this
was the most appropriate methodology given the circumstances of the investment being
valued.
We understood the Investment Manager’s assessment of climate risk and its impact on the
valuation methodology and inputs, where and as applicable.
Direct Investments
We obtained the Investment Manager's earnings multiple valuation model containing earnings,
trading multiples for listed comparable companies and the evaluated multiple used to value the
investment, or the relevant discounted cash flow model, cash flows and discount rate applied.
A) Input testing
● We obtained the relevant management information including earnings or cash flow
inputs for the underlying investments. We used this to corroborate the information
applied in the valuation models;
● We evaluated the earnings or cash flows used in the valuation model based on our
understanding of the financial performance of the respective underlying investment,
and assessed the appropriateness of any changes made by the Investment Manager
in the application of these inputs to the valuation;
● For investments valued on an earnings multiples basis, we considered the
appropriateness of, and independently confirmed, the trading multiples for listed
comparable companies used. We assessed the appropriateness of any adjustments,
weightings or discounts made by the Investment Manager to the comparable trading
multiples to arrive at the applied multiple used in the valuation;
● Where we identified other listed comparable companies that we believed represented
relevant earnings trading multiples, we evaluated and considered the impact of their
inclusion on the fair value;
● For investments valued using a discounted cash flow model, we independently
sourced, where appropriate, the cash flows and inputs to the discount rate (or
discount rate used if provided by a third party) applied in the valuation model used.
For those inputs where we identified differences, an assessment was made of the
impact; and
● We performed open-source searches to identify relevant, publicly available
information that the Investment Manager had not considered in determining the value
of the investments, both during the year and subsequent to the year end.
● In assessing the impact and difference noted above, where such differences were
significant, we challenged management as to such valuation differences and, if these
could not be justified, we sought adjustment for such differences to the valuations
presented and considered the impact on our overall investment valuation sampling
methodology.
B) Calculation
● We checked the mathematical accuracy of the investment valuation models; and
● We also recalculated the attribution of the value of the unlisted investments across the
financial instruments held by the group, checking that the instrument type and ranking
of all financial instruments in issue at an underlying investment level are considered in
the assessment
of the group’s unlisted investment valuatio
n
.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 56 | Annual Report 2023
Key audit matter
How our audit addressed the key audit matter
Indirect Investments
A) Input testing
●
Where underlying net asset valuations were used to value investments in funds, we
corroborated these by tracing them to supporting documentation such as capital
account statements received by the Investment Manager and checked details such as
the group's committed capital, unfunded commitments, and percentage ownership;
● Where the Investment Manager adjusted these values for any listed or quoted
positions held by the indirect investments (for example where such information was
not coterminous with the year e
nd and such details were available for the respective
indirect investment), we verified the market prices applied to the adjusted net asset
valuation at the year end;
● We evaluated the appropriateness of the source documentation by performing
independent confirmation procedures with the administrators of the underlying
investment funds; and
● To evaluate the reliability of the Investment Manager’s process we performed
backtesting of the source documentation used in the group's prior year valuations
against the
audited financial statements issued by the underlying investment funds.
B) Calculation
●
As the source documentation obtained for indirect investments related primarily to 30
September 2023, we tested the control procedures in place at the Investment
Manager over the rollforward of the net asset value from 30 September 2023 to 31
December 2023; and
●
We checked the mathematical accuracy and completeness of the rollforward reports
that contain the valuations for indirect investments.
Based on our work performed, we did not identify any material differences or matters for further
consideration.
Calculation of incentive fee
See notes 5 and 15 of the consolidated
financial statements for further information
on the incentive fees payable by the group.
Incentive fees comprise amounts accrued
and payable to the Investment Manager to
compensate them for services provided in a
way which aligns their remuneration with the
group's investment performance.
The incentive fee calculations, which are
undertaken in accordance with the offering
documents and investment management
agreement betw
een the group and the
Investment Manager are complex, which
increases the risk of error.
Incentive fees are calculated based on the
fair value and cash flows of each direct and
secondary investment (as defined in the
investment management agreement). This
calculation is performed separately for each
direct and secondary investment, and also
includes adjustments for such items as
underlying fee rebates. This means that
some of the calculations can be based on
calculations with a number of data inputs,
some of which are unobservable, selected or
calculated by management and therefore
also subject to judg
ment.
We focused on the incentive fee calculation
due to the complexity of the calculation and
also due to the nature of the incentive fees
as there may be an increased risk that these
are overstated.
Our audit approach was based upon the specifics of the incentive fee arrangements as set out
in the investment management agreement and the notes to the consolidated financial
statements, and which are described in the company's offering documents.
We performed the following procedures over the incentive fees:
● We obtained a schedule of incentive fees expensed and examined the offering
documents and investment management agreement to check that incentive fees are
being calculated and accrued only when the contractual conditions existed for the
incentive fee to be recognized;
● We also checked that all parameters of the incentive fee were included within the
calculation, as set out in the offering documents and investment management
agreement;
● We performed both controls and substantive testing over the occurrence of the
investment disposals, the value of such disposals and the gains realized on such
disposals. This included checking that the returns achieved met the conditions in
place for the incentive fee to be triggered; and
● We recalculated the incentive fee attribu
table to the Investment Manager using the
applicable methodology.
Based on our work performed, we did not identify any material differences or matters for further
consideration.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 57
How we tailored the audit scope
We tailored the scope of our audit to ensure that we performed enough work to be able to give an opinion on the consolidated
financial statements as a whole, taking into account the structure of the group, the accounting processes and controls, the
industry in which the group operates, and we considered the risk of climate change and the potential impact thereof on our
audit approach.
Scoping was performed at the group level with reference to the overall group materiality and the risks of material misstatement
identified, irrespective of whether the underlying transactions took place within the company or within the subsidiaries. Indi-
vidual subsidiaries were however assessed against an allocated component materiality to address the risk of material misstatement
to the group at the component level.
The transactions relating to the company and the subsidiaries are all maintained and made available to us and our supporting
firm (a separate PwC network firm) by the Investment Manager and Partners Group (Guernsey) Limited (the "Administrator").
As well as being under our direction and supervision, the audit work performed by our supporting firm is subject to our review.
Materiality
The scope of our audit was influenced by our application of materiality. We set certain quantitative thresholds for materiality.
These, together with qualitative considerations, helped us to determine the scope of our audit and the nature, timing and extent
of our audit procedures on the individual financial statement line items and disclosures and in evaluating the effect of misstate-
ments, both individually and in aggregate on the consolidated financial statements as a whole.
Based on our professional judgement, we determined materiality for the consolidated financial statements as a whole as follows:
€22.0 million (2022: €23.7 million).Overall group materiality
2.25% of net assetsHow we determined it
We believe that net assets is the most appropriate benchmark because
this is the key metric of interest to the members of the company. It is also a
generally accepted measure used for companies in this industry.
Rationale for benchmark applied
For each component in the scope of our group audit, we allocated a materiality that is less than our overall group materiality.
The range of materiality allocated across components was €15.7 million - €22.0 million.
We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and
undetected misstatements exceeds overall materiality. Specifically, we use performance materiality in determining the scope
of our audit and the nature and extent of our testing of account balances, classes of transactions and disclosures, for example
in determining sample sizes. Our performance materiality was 75% (2022: 75%) of overall materiality, amounting to €16.5
million (2022: €17.0 million) for the group consolidated financial statements.
In determining the performance materiality, we considered a number of factors - the history of misstatements, risk assessment
and aggregation risk and the effectiveness of controls - and concluded that an amount at the upper end of our normal range
was appropriate.
We agreed with the Audit and Risk Committee that we would report to them misstatements identified during our audit above
€1.1 million (2022: €1.1 million) as well as misstatements below that amount that, in our view, warranted reporting for qualit-
ative reasons.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 58 | Annual Report 2023
Reporting on other information
The other information comprises all the information included in the Annual Report 2023 (the "Annual Report") but does not
include the consolidated financial statements and our auditor's report thereon. The directors are responsible for the other in-
formation.
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 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 based on these responsibilities.
Responsibilities for the consolidated financial statements and the audit
Responsibilities of the directors for the consolidated financial statements
As explained more fully in the Directors' duties and responsibilities statement, the directors are responsible for the preparation
of the consolidated financial statements that give a true and fair view in accordance with IFRS Accounting Standards, the re-
quirements of Guernsey law and for such internal control as the directors determine 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 directors are responsible for assessing the group'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 directors either intend to liquidate the group or to cease operations, or have no realistic alternative but to do so.
Auditor's responsibilities for the audit of the consolidated financial statements
Our objectives 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 auditor's 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 ISAs will always detect
a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually
or in aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these
consolidated financial statements.
Our audit testing might include testing complete populations of certain transactions and balances, possibly using data auditing
techniques. However, it typically involves selecting a limited number of items for testing, rather than testing complete populations.
We will often seek to target particular items for testing based on their size or risk characteristics. In other cases, we will use
audit sampling to enable us to draw a conclusion about the population from which the sample is selected.
As part of an audit in accordance with ISAs, 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 ap-
propriate 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.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 59
• 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 group's internal control.
• Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related dis-
closures made by the directors.
• Conclude on the appropriateness of the directors' 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 group's ability to continue as a going concern over a period of at least twelve months from the date of approval of
the consolidated financial statements. If we conclude that a material uncertainty exists, we are required to draw attention
in our auditor's 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 auditor's report.
• 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.
• Obtain sufficient appropriate audit evidence regarding the financial information of the entities or business activities within
the group to express an opinion on the consolidated financial statements. We are responsible for the direction, supervision
and performance of the group 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 to communicate with them all relationships and other matters that may reasonably be thought
to bear on our independence, and where applicable, related safeguards.
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 auditor's report unless law or regulation precludes public disclosure about the matter or when, in extremely
rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences
of doing so would reasonably be expected to outweigh the public interest benefits of such communication.
Use of this report
This report, including the opinions, has been prepared for and only for the members as a body in accordance with Section 262
of The Companies (Guernsey) Law, 2008 and for no other purpose. We do not, in giving these opinions, accept or assume
responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come
save where expressly agreed by our prior consent in writing.
Report on other legal and regulatory requirements
Company Law exception reporting
Under The Companies (Guernsey) Law, 2008 we are required to report to you if, in our opinion:
• we have not received all the information and explanations we require for our audit;
• proper accounting records have not been kept; or
• the consolidated financial statements are not in agreement with the accounting records.
We have no exceptions to report arising from this responsibility.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 60 | Annual Report 2023
Corporate governance statement
The Listing Rules require us to review the directors' statements in relation to going concern, longer-term viability and that part
of the corporate governance statement relating to the company's compliance with the provisions of the UK Corporate Gov-
ernance Code specified for our review. Our additional responsibilities with respect to the corporate governance statement as
other information are described in the Reporting on other information section of this report.
The company has reported compliance against the 2019 AIC Code of Corporate Governance (the "Code") which has been
endorsed by the UK Financial Reporting Council as being consistent with the UK Corporate Governance Code for the purposes
of meeting the company's obligations, as an investment company, under the Listing Rules of the FCA.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the corporate
governance statement, included within the Corporate Governance section of the consolidated financial statements is materially
consistent with the consolidated financial statements and our knowledge obtained during the audit, and we have nothing
material to add or draw attention to in relation to:
• The directors' confirmation that they have carried out a robust assessment of the emerging and principal risks;
• The disclosures in the Annual Report that describe those principal risks, what procedures are in place to identify emerging
risks and an explanation of how these are being managed or mitigated;
• The directors' statement in the consolidated financial statements about whether they considered it appropriate to adopt
the going concern basis of accounting in preparing them, and their identification of any material uncertainties to the group's
ability to continue to do so over a period of at least twelve months from the date of approval of the consolidated financial
statements;
• The directors' explanation as to their assessment of the group's prospects, the period this assessment covers and why the
period is appropriate; and
• The directors' statement as to whether they have a reasonable expectation that the company will be able to continue in
operation and meet its liabilities as they fall due over the period of its assessment, including any related disclosures drawing
attention to any necessary qualifications or assumptions.
Our review of the directors' statement regarding the longer-term viability of the group was substantially less in scope than an
audit and only consisted of making inquiries and considering the directors' process supporting their statements; checking that
the statements are in alignment with the relevant provisions of the Code; and considering whether the statement is consistent
with the consolidated financial statements and our knowledge and understanding of the group and its environment obtained
in the course of the audit.
In addition, based on the work undertaken as part of our audit, we have concluded that each of the following elements of the
corporate governance statement is materially consistent with the consolidated financial statements and our knowledge obtained
during the audit:
• The directors' statement that they consider the Annual Report, taken as a whole, is fair, balanced and understandable, and
provides the information necessary for the members to assess the group 's position, performance, business model and
strategy;
• The section of the Annual Report that describes the review of effectiveness of risk management and internal control systems;
and
• The section of the Annual Report describing the work of the Audit & Risk Committee.
We have nothing to report in respect of our responsibility to report when the directors' statement relating to the company's
compliance with the Code does not properly disclose a departure from a relevant provision of the Code specified under the
Listing Rules for review by the auditors.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 61
Other matter
As required by the Financial Conduct Authority Disclosure Guidance and Transparency Rule 4.1.14R, these consolidated fin-
ancial statements will form part of the ESEF-prepared annual financial report filed on the National Storage Mechanism of the
Financial Conduct Authority in accordance with the ESEF Regulatory Technical Standard ("ESEF RTS"). This auditor's report
provides no assurance over whether the annual financial report will be prepared using the single electronic format specified
in the ESEF RTS.
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 62 | Annual Report 2023
Roland Mills
For and on behalf of PricewaterhouseCoopers CI LLP
Chartered Accountants and Recognised Auditor
Guernsey, Channel Islands
22 March 2024
PRINCESS PRIVATE EQUITY HOLDING LIMITED
12. Audited consolidated financial statements
Audited consolidated statement of comprehensive income
for the period from 1 January 2023 to 31 December 2023
Notes
| 01.01.2023 | 01.01.2022 | ||
| In thousands of EUR | 31.12.2023 | 31.12.2022 | |
Netincomefromfinancialassetsatfairvaluethroughprofitorloss | |||
Privateequity | |||
Interest÷ndincome | |||
Revaluation | 9 | ||
Withholdingtaxondirectprivateequityinvestments | 9 | ( | ( |
Netforeignexchangegains/(losses) | 9 | ( | |
Privatedebt | ( | ( | |
Interestincome(includingpayment-in-kind) | ( | ( | |
Revaluation | 9 | ( | |
Netforeignexchangegains/(losses) | 9 | ( | |
Privaterealestate | ( | ( | |
Revaluation | 9 | ( | ( |
Privateinfrastructure | |||
Interest÷ndincome | |||
Revaluation | 9 | ||
Netforeignexchangegains/(losses) | 9 | ( | |
Netincomefromcash&cashequivalentsandotherincome | ( | ||
Netforeignexchangegains/(losses) | ( | ||
Totalnetincome | |||
Operatingexpenses | ( | ( | |
Managementfees | 19 | ( | ( |
Incentivefees | 15,19 | ( | ( |
Administrationfees | 19 | ( | ( |
Servicefees | 19 | ( | ( |
Otheroperatingexpenses | ( | ( | |
Othernetforeignexchangegains/(losses) | ( | ( | |
Otherfinancialactivities | ( | ||
Interestexpense-creditfacilities | 14 | ( | ( |
Otherfinancecost | ( | ( | |
Netgains/(losses)fromhedgingactivities | 11 | ( | |
Otherincome | |||
Surplus/(loss)forperiod | ( |
Annual Report 2023 | Page 63
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Notes
| 01.01.2023 | 01.01.2022 | |
| In thousands of EUR | 31.12.2023 | 31.12.2022 |
Othercomprehensiveincomeforperiod;netoftax | ||
Totalcomprehensiveincomeforperiod | ( | |
Weightedaveragenumberofsharesoutstanding | ||
Basicsurplus/(loss)pershareforperiod(inEUR) | ( | |
Dilutedsurplus/(loss)pershareforperiod(inEUR) | ( |
<>
The earnings per share is calculated by dividing the surplus / (loss) for period by the weighted average number of shares outstanding.
The above audited consolidated statement of comprehensive income should be read in conjunction with the accompanying notes.
Page 64 | Annual Report 2023
Audited consolidated statement of financial position
As at 31 December 2023
Notes | 31.12.2023 | 31.12.2022 | |
| In thousands of EUR | |||
| ASSETS | |||
| Financial assets at fair value through profit or loss | |||
Private equity | 9,18 | ||
Private debt | 9,18 | ||
Private real estate | 9,18 | ||
Private infrastructure | 9,18 | ||
| Financial assets at amortized cost | |||
Other long-term receivables | |||
Non-current assets | |||
Other short-term receivables | 18 | ||
Derivative assets | 11,18 | ||
Cash and cash equivalents | |||
Withheld taxes available for deemed distributions | |||
Current assets | |||
TOTAL ASSETS | |||
| EQUITY AND LIABILITIES | |||
Share capital | 12 | ||
Reserves | |||
Total equity | |||
Short-term credit facility | |||
Derivative liabilities | |||
Accruals and other short-term payables | |||
Liabilities falling due within one year | |||
<>
14
11,18
10
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 65
The above audited consolidated statement of financial position should be read in conjunction with the accompanying notes.
P. McKellar
Director
M. Wheatley
Director
Audited consolidated statement of changes in equity
for the period from 1 January 2023 to 31 December 2023
| TotalReservesShare capital | |||
| In thousands of EUR | |||
Balance at the beginning of period | |||
Dividends declared | ( | ( | |
Surplus / (loss) for period | |||
Equity at end of period | |||
| <> | |||
| for the period from 1 January 2022 to 31 December 2022 | Share capital | Reserves | Total |
| In thousands of EUR | |||
Balance at the beginning of period | |||
Dividends declared | ( | ( | |
Surplus / (loss) for period | ( | ( | |
Equity at end of period |
<>
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 66 | Annual Report 2023
The above audited consolidated statement of changes in equity should be read in conjunction with the accompanying notes.
Audited consolidated statement of cash flows
for the period from 1 January 2023 to 31 December 2023
| Notes | 01.01.2023 | 01.01.2022 | ||
| In thousands of EUR | 31.12.2023 | 31.12.2022 | ||
| Operating activities | ||||
Surplus / (loss) for period before interest expense | ( | |||
| Adjustments: | ||||
Net foreign exchange (gains) / losses | ( | |||
Investment revaluation | ( | ( | ||
Withholding tax on direct investments | ||||
Net result from interest income / (expense) | ||||
Net result from dividend income | ( | ( | ||
Revaluation on forward hedges | 11 | ( | ||
(Increase) / decrease in receivables | ( | ( | ||
(Increase) / decrease in withheld taxes available for deemed distributions | ( | |||
Increase / (decrease) in payables | ( | |||
Realized gains / (losses) from forward hedges | 11 | ( | ||
Purchase of private equity investments | 9 | ( | ( | |
Purchase of private debt investments | 9 | ( | ||
Purchase of private real estate investments | 9 | |||
Purchase of private infrastructure investments | 9 | ( | ( | |
Distributions from and proceeds from sales of private equity investments | 9 | |||
Distributions from and proceeds from sales of private debt investments | 9 | |||
Distributions from and proceeds from sales of private real estate investments | 9 | |||
Distributions from and proceeds from sales of private infrastructure investments | 9 | |||
Interest & dividends received | ||||
Net cash from / (used in) operating activities | ||||
| Financing activities | ||||
Increase in credit facilities | 14 | |||
(Decrease) in credit facilities | 14 | ( | ( | |
Interest paid | - credit facilities | 14 | ( | ( |
Dividends declared | 12 | ( | ( | |
Net cash from / (used in) financing activities | ( | ( | ||
Net increase / (decrease) in cash and cash equivalents | ( | ( | ||
Cash and cash equivalents at beginning of period | ||||
Effects of foreign currency exchange rate changes on cash and cash equivalents | ( | |||
<>
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 67
The above audited consolidated statement of cash flows should be read in conjunction with the accompanying notes.
Notes to the audited consolidated financial statements
for the period from 1 January 2023 to 31 December 2023
1 Organization and business activity
Company's registered office is Tudor House, St. Peter Port, Guernsey , GY1 6BD . The Company is a Guernsey limited liability
subsidiary Princess Direct Investments, L.P. Inc. (the "Sub-Subsidiary"). The Sub-Subsidiary, the Subsidiary, and the Company
form a group (the "Group"). Both of these subsidiaries are consolidated as they are deemed to provide investment-related
services to the Company. The Group primarily accesses investments directly, and to a lesser extent via Partners Group's private
equity programs; Princess also holds a small portfolio of fund investments that is currently in run-off.
The shares of the Company were listed on the Prime Standard of the Frankfurt Stock Exchange from 13 December 2006 until
5 December 2012 (date of delisting). The shares of the Company remain listed on the Main Market of the London Stock
Exchange, where they have been listed since 1 November 2007.
2 Basis of preparation
The preparation of audited consolidated financial statements, in conformity with IFRS, requires the use of estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the
date of the audited consolidated financial statements and the reported amounts of revenues and expenses during the reporting
period. Although these estimates are based on management's best knowledge of current events and actions, actual results
may ultimately differ from those estimates. The areas where assumptions, judgements and estimates are significant to the
audited consolidated financial statements are disclosed in Note 4, 'Critical accounting estimates and judgements'.
The Directors of the Company have elected to prepare audited consolidated financial statements for Princess Private Equity
Holding Limited for the period ended 31 December 2023 as the parent of the Group and therefore, in accordance with Section
244(5) of The Companies (Guernsey) Law, 2008, they are not required to prepare individual accounts for the financial period for
Princess Private Equity Holding Limited in accordance with Section 243 of The Companies (Guernsey) Law, 2008.
3 Material accounting policies
PRINCESS PRIVATE EQUITY HOLDING LIMITED
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PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 69
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 70 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 71
PRINCESS PRIVATE EQUITY HOLDING LIMITED
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PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 73
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 74 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 75
5 Expenses
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 76 | Annual Report 2023
6 Taxation
The Company and the Subsidiaries are exempt from taxation in Guernsey under The Income Tax (Exempt Bodies) (Guernsey)
Ordinance, 1989 and are each liable for the payment of an annual fixed rate of GBP 1,200 per annum for the granting of the
exemption.
The Group may incur withholding taxes imposed by certain countries on income from underlying investments. Such income
is recognized gross of withholding taxes in the audited consolidated statement of comprehensive income.
7 Dividends
During the reporting period, the Board of Directors of Princess Private Equity Holding Limited declared two interim dividends,
each of EUR 0.365 per ordinary share, which were paid on 2 June 2023 and 15 December 2023 to shareholders on the
register of members as at 28 April 2023 and 10 November 2023, respectively, in total amounting to EUR 50.5 million (2022:
one interim dividend of EUR 0.38 per ordinary share, which was paid on 17 June 2022 to shareholders on the register of
members as at 13 May 2022, in total amounting to EUR 26.3 million).
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 77
PRINCESS PRIVATE EQUITY HOLDING LIMITED
| 01.01.2023 | 01.01.2022 | |
| In thousands of EUR | 31.12.2023 | 31.12.2022 |
| Private equity | ||
Interest÷ndincome | 47 | 543 |
Revaluation | 54,660 | 25,693 |
Withholdingtaxondirectprivateequityinvestments | (832) | (428) |
Netforeignexchangegains/(losses) | (10,253) | 20,639 |
Totalnetincomeprivateequity | 43,622 | 46,447 |
Segmentresultprivateequity | 43,622 | 46,447 |
| Private debt | ||
Interestincome(includingpayment-in-kind) | (427) | (155) |
Revaluation | 7 | (3,363) |
Netforeignexchangegains/(losses) | (737) | 1,425 |
Totalnetincomeprivatedebt | (1,157) | (2,093) |
Segmentresultprivatedebt | (1,157) | (2,093) |
| Private real estate | ||
Revaluation | (12) | (52) |
Totalnetincomeprivaterealestate | (12) | (52) |
Segmentresultprivaterealestate | (12) | (52) |
| Private infrastructure | ||
Interest÷ndincome | 244 | - |
Revaluation | 4,387 | 2,721 |
Netforeignexchangegains/(losses) | (839) | 1,223 |
Totalnetincomeprivateinfrastructure | 3,792 | 3,944 |
Segmentresultprivateinfrastructure | 3,792 | 3,944 |
| Non-attributable | ||
Netforeignexchangegains/(losses) | (17) | 754 |
Totalnetincomenon-attributable | (17) | 754 |
Segmentresultnon-attributable | (28,966) | (35,149) |
Otherfinancialactivitiesnotallocated | 1,142 | (30,530) |
Surplus/(loss)forperiod | 18,421 | (17,433) |
<>
Page 78 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Balanceatbeginningofperiod | 968,814 | 852,606 |
PurchaseofDirectandIndirectInvestments | 4,790 | 154,905 |
DistributionsfromandproceedsfromsalesofDirectandIndirectInvestments | (47,799) | (84,127) |
Accruedcashandpayment-in-kindinterest | 11 | (474) |
Revaluation | 54,660 | 25,693 |
Withholdingtaxondirectprivateequityinvestments | (832) | (428) |
Netforeignexchangegains/(losses) | (10,253) | 20,639 |
Balanceatendofperiod | 969,391 | 968,814 |
Movementinunrealizedgains/(losses)stillheldatendofperiod | 20,460 | (23,482) |
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Balanceatbeginningofperiod | 22,136 | 162,771 |
PurchaseofDirectandIndirectInvestments | 995 | (423) |
DistributionsfromandproceedsfromsalesofDirectandIndirectInvestments | (1,117) | (137,720) |
Accruedcashandpayment-in-kindinterest | (661) | (554) |
Revaluation | 7 | (3,363) |
Netforeignexchangegains/(losses) | (737) | 1,425 |
Balanceatendofperiod | 20,623 | 22,136 |
Movementinunrealizedgains/(losses)stillheldatendofperiod | 2,417 | (510) |
Annual Report 2023 | Page 79
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Balanceatbeginningofperiod | 105 | 753 |
PurchaseofDirectandIndirectInvestments | (12) | (51) |
DistributionsfromandproceedsfromsalesofDirectandIndirectInvestments | (4) | (545) |
Revaluation | (12) | (52) |
Balanceatendofperiod | 77 | 105 |
Movementinunrealizedgains/(losses)stillheldatendofperiod | (28) | (649) |
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Balanceatbeginningofperiod | 39,016 | 35,111 |
PurchaseofDirectandIndirectInvestments | 1 | 454 |
DistributionsfromandproceedsfromsalesofDirectandIndirectInvestments | (3,597) | (493) |
Revaluation | 4,387 | 2,721 |
Netforeignexchangegains/(losses) | (839) | 1,223 |
Balanceatendofperiod | 38,968 | 39,016 |
Movementinunrealizedgains/(losses)stillheldatendofperiod | 3,006 | 3,922 |
Page 80 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
| Foreign exchange forward contracts | ||
Unrealizedgains/(losses) | (22,889) | 27,097 |
Realizedgains/(losses) | 27,023 | (55,475) |
Totalgains/(losses)fromforwardcontracts | 4,134 | (28,378) |
| Open foreign exchange | Volume of currency | Volumeofcurrency | Valuedate | Fair value (in |
| forward/option contracts | sold (in thousands) | bought (in thousands) | thousands of | |
| EUR) | ||||
Foreignexchangeforwardcontract | EUR54,141 | USD57,200 | 04.01.2023 | (523) |
Foreignexchangeforwardcontract | USD57,200 | EUR56,587 | 04.01.2023 | 2,968 |
Foreignexchangeforwardcontract | EUR54,183 | USD57,300 | 18.01.2023 | (521) |
Foreignexchangeforwardcontract | USD57,300 | EUR56,632 | 18.01.2023 | 2,968 |
Foreignexchangeforwardcontract | EUR40,605 | GBP34,890 | 25.01.2023 | (1,301) |
Foreignexchangeforwardcontract | GBP34,890 | EUR39,988 | 25.01.2023 | 686 |
Foreignexchangeforwardcontract | USD67,700 | EUR69,129 | 01.02.2023 | 5,782 |
Foreignexchangeforwardcontract | USD67,700 | EUR69,197 | 01.02.2023 | 5,850 |
Foreignexchangeforwardcontract | INR1,000,000 | EUR11,432 | 15.02.2023 | 189 |
Foreignexchangeforwardcontract | INR1,000,000 | EUR11,432 | 15.02.2023 | 189 |
Foreignexchangeforwardcontract | USD71,000 | EUR68,271 | 08.03.2023 | 1,996 |
Foreignexchangeforwardcontract | USD71,000 | EUR68,230 | 15.03.2023 | 1,979 |
Foreignexchangeforwardcontract | CHF12,400 | EUR12,614 | 22.03.2023 | 17 |
Foreignexchangeforwardcontract | CHF26,750 | EUR27,571 | 22.03.2023 | 395 |
Foreignexchangeforwardcontract | USD57,200 | EUR53,786 | 05.04.2023 | 473 |
Foreignexchangeforwardcontract | USD57,300 | EUR53,830 | 19.04.2023 | 471 |
Foreignexchangeforwardcontract | GBP34,890 | EUR40,425 | 26.04.2023 | 1,271 |
<>
Annual Report 2023 | Page 81
PRINCESS PRIVATE EQUITY HOLDING LIMITED
12 Share capital, treasury shares, and reserves
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
| Issued and fully paid | ||
69,151,168ordinarysharesofEUR0.001eachoutofthebondconversion | 69 | 69 |
Totalissuedandfullypaidshares | 69 | 69 |
13 Commitments to Direct and Indirect Investments
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Unfundedcommitmentstranslatedattherateprevailingatendofperiod | 115,294 | 103,325 |
<>
Page 82 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
| Short-term credit facility | ||
Balanceatbeginningofperiod | - | 25,000 |
Increaseincreditfacility | 49,200 | 108,000 |
(Decrease)increditfacility | (30,200) | (133,000) |
Balanceatendofperiod | 19,000 | - |
<>
15 Incentive fees
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Balanceatbeginningofperiod | 28,831 | 17,530 |
ChangeinincentivefeesattributabletoInvestmentManager | 11,027 | 18,829 |
Annual Report 2023 | Page 83
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Incentivefeespaid/payable | (2,125) | (7,528) |
Balanceatendofperiod | 37,733 | 28,831 |
Incentivefeesaccrued | 69,352 | 61,896 |
Incentivefeerebatesaccrued | (31,619) | (33,065) |
Totalnetincentivefees | 37,733 | 28,831 |
<>
The incentive fee balance as at the end of each period presented above represents a net amount which consists of incentive
fees accrued and incentive fee rebates accrued. Both net incentive fee balance as well as gross incentive fees accrued and
incentive fee rebates accrued as at the end of each period are presented separately.
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
NetassetsoftheGroup | 979,245 | 1,011,304 |
Outstandingsharesattheendofthereportingperiod | 69,151,168.00 | 69,151,168.00 |
Netassetspershareatperiodend | 14.16 | 14.62 |
<>
17 Financial risk management
The Group's activities expose it to a variety of financial risks, including the effects of changes in debt and equity market prices,
foreign currency exchange rates and interest rates. There is also counterparty risk from bank balances and derivatives (and
money market instruments if held by the Group). That would be the risk that a counterparty to a financial instrument will fail
to discharge an obligation or commitment it has entered into with the Group. The Group's overall risk management policy
focuses on the unpredictability of financial markets and seeks to minimize potential adverse effects on the financial performance
of the Group. During the reporting period, the Group discontinued the hedging of currency exposures. The Group now reports
the underlying investment currencies on a monthly basis, to allow investors who prefer a hedged exposure to apply their own
hedging overlay.
Following the transition of non-USD interbank offered rates ("IBORs") to alternative reference rates in previous reporting
years, the Group successfully made the transition to appropriate reference rates when USD LIBOR ceased on 30 June 2023.
Page 84 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
NetassetsdenominatedinAUD | 1 | 4 |
NetassetsdenominatedinCHF | 52,556 | 8,214 |
NetassetsdenominatedinGBP | 38,634 | (1,444) |
NetassetsdenominatedinUSD | 430,879 | 77,847 |
NetassetsdenominatedinINR | 25,179 | (2,691) |
NetassetsdenominatedinILS | 1 | - |
ApplicableannualvolatilityAUD | 7.85% | 8.46% |
ApplicableannualvolatilityCHF | 6.31% | 6.30% |
ApplicableannualvolatilityGBP | 6.55% | 6.89% |
ApplicableannualvolatilityUSD | 7.51% | 7.45% |
ApplicableannualvolatilityINR | 7.85% | 8.58% |
ApplicableannualvolatilityILS | 7.97% | 7.57% |
Fluctuationofnetassetsandcorrespondingresultsdependingonabove-mentionedvolatility | 40,183 | 5,987 |
Annual Report 2023 | Page 85
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Mezzanineandseniordebtinvestments | 295 | 9,055 |
Cashandcashequivalents | 9,744 | 14,851 |
Creditfacility | (19,000) | - |
Totalvariablerateinstruments | (8,961) | 23,906 |
100bpincrease | 100bpdecrease | |
| In thousands of EUR | ||
Impactonvariablerateinstruments | (90) | 90 |
| 100bp increase | 100bp decrease | |
| In thousands of EUR | ||
Impactonvariablerateinstruments | 239 | (239) |
Page 86 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Tooearly | - | - |
Withissues | 295 | 9,055 |
Onplan | - | - |
Aboveplan | - | - |
Outperformer | - | - |
Total | 295 | 9,055 |
<>
Annual Report 2023 | Page 87
PRINCESS PRIVATE EQUITY HOLDING LIMITED
| Not past due | Past due less | Past due more | |
| In thousands of EUR | than 1 year | than 1 year | |
Derivativeassets | - | - | - |
Cashandcashequivalents | 9,744 | - | - |
Othershort-termreceivables | 4,245 | - | - |
Otherlong-termreceivables | 1,383 | - | - |
Mezzanineandseniordebtinvestments | 295 | - | - |
| Not past due | Past due less | Past due more | |
| In thousands of EUR | than 1 year | than 1 year | |
Derivativeassets | 24,711 | - | - |
Cashandcashequivalents | 14,851 | - | - |
Othershort-termreceivables | 3,867 | - | - |
Otherlong-termreceivables | 1,433 | - | - |
Mezzanineandseniordebtinvestments | 9,055 | - | - |
Page 88 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Lessthan3 | 3to12months | More than 12 | |
| In thousands of EUR | months | months | |
UnfundedcommitmentstoDirectandIndirectInvestments | (115,294) | - | - |
Liabilitiesfallingduewithinoneyear | (27,858) | (37,733) | - |
Derivativeassets | - | - | - |
Currentassets | 14,394 | - | - |
Otherlong-termreceivables | - | - | 1,383 |
Undrawncreditfacility | 121,000 | - | - |
Total | (7,758) | (37,733) | 1,383 |
Lessthan3 | 3to12months | More than 12 | |
| In thousands of EUR | months | months | |
UnfundedcommitmentstoDirectandIndirectInvestments | (103,325) | - | - |
Liabilitiesfallingduewithinoneyear | (32,976) | (28,831) | - |
Derivativeliabilities | (1,822) | - | - |
Derivativeassets | 22,496 | 2,215 | - |
Currentassets | 18,718 | - | - |
Otherlong-termreceivables | - | - | 1,433 |
Undrawncreditfacility | 110,000 | - | - |
Total | 13,091 | (26,616) | 1,433 |
Annual Report 2023 | Page 89
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Financialassetsatfairvaluethroughprofitorloss | 1,029,059 | 1,030,071 |
Totalassetssubjecttomarketrisk | 1,029,059 | 1,030,071 |
Annualexpectedvolatility | 14.08% | 13.91% |
Potentialimpactonauditedconsolidatedfinancialstatements | 144,892 | 143,283 |
<>
Page 90 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
A | B | C=A-B | D | E=C-D | ||||
| in thousands of EUR | ||||||||
| 31.12.2022 | Gross amounts Gross amounts of Net amounts of | Related amounts not set-off in the | Net | |||||
| of recognized | recognized | financial | audited consolidated statement of | amount | ||||
financial assets financial liabilities | assets presented in financial position | |||||||
| set-off in the | the audited | |||||||
| audited | consolidated | |||||||
| consolidated | statement of | |||||||
| statement of | financial position | |||||||
| financial position | ||||||||
| Derivative assets | Financial Cash/(Bank | Financial | ||||||
| Instruments | Overdrafts) | Instrument | ||||||
| Collateral | ||||||||
CounterpartyA | 8,768 | 523 | 8,245 | - | - | 8,070 | 175 | |
CounterpartyB | 4,132 | - | 4,132 | - | - | 2,130 | 2,002 | |
CounterpartyI | 6,467 | - | 6,467 | - | - | 6,020 | 447 | |
CounterpartyQ | 17 | - | 17 | - | - | - | 17 | |
CounterpartyAH | 5,850 | - | 5,850 | - | - | 5,730 | 120 | |
Annual Report 2023 | Page 91
PRINCESS PRIVATE EQUITY HOLDING LIMITED
<>
A | B | C=A-B | D | E=C-D | ||||
| in thousands of EUR | ||||||||
| 31.12.2022 | Gross amounts Gross amounts of | Net amounts of | Related amounts not set-off in the audited Net | |||||
| of recognized | recognized | financial liabilities | consolidated statement of financial | amount | ||||
| financial | financial assets | presented in the | position | |||||
| liabilities | set-off in the | audited | ||||||
| audited | consolidated | |||||||
| consolidated | statement of | |||||||
| statement of | financial position | |||||||
| financial position | ||||||||
| Derivative | Financial | Cash/(Bank | Financial | |||||
| liabilities | Instruments | Overdrafts) | Instrument | |||||
| Collateral | ||||||||
Counterparty | 1,822 | - | 1,822 | - | - | - | 1,822 | |
<>
Page 92 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
| 31.12.2023 | |
| NAV in thousands of EUR | |
| Region & Strategy | |
| North America | |
Buyout | 216,947 |
Specialsituations | 13,210 |
Venturecapital | 55 |
| Western Europe | |
Buyout | 158,037 |
Realestate | 77 |
Venturecapital | 7,600 |
Infrastructure | 15,231 |
| Rest of World | |
Buyout | 2,042 |
Venturecapital | 4,848 |
| 31.12.2022 | |
| NAV in thousands of EUR | |
| Region & Strategy | |
| North America | |
Buyout | 276,267 |
Specialsituations | 14,035 |
Venturecapital | 1,131 |
| Western Europe | |
Buyout | 213,651 |
Realestate | 105 |
Venturecapital | 7,805 |
Infrastructure | 14,478 |
| Rest of World | |
Buyout | 7,051 |
Venturecapital | 8,561 |
<>
Annual Report 2023 | Page 93
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 94 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Level1 | Level2 | Level3 | Totalbalance | |
| In thousands of EUR | ||||
| Assets | ||||
Othershort-termreceivables | - | - | 4,245 | 4,245 |
Derivativesusedforhedging | - | - | - | - |
| Financial assets at fair value through profit or loss - equity | - | - | 1,008,436 | 1,008,436 |
| securities | ||||
| Financial assets at fair value through profit or loss - debt | - | - | 20,623 | 20,623 |
| investments | ||||
Totalassets | - | - | 1,033,304 | 1,033,304 |
| Liabilities | ||||
Derivativesusedforhedging | - | - | - | - |
Totalliabilities | - | - | - | - |
Level1 | Level2 | Level3 | Totalbalance | |
| In thousands of EUR | ||||
| Assets | ||||
Othershort-termreceivables | - | - | 3,867 | 3,867 |
Derivativesusedforhedging | - | 24,711 | - | 24,711 |
| Financial assets at fair value through profit or loss - equity | - | - | 1,007,935 | 1,007,935 |
| securities | ||||
| Financial assets at fair value through profit or loss - debt | - | - | 22,136 | 22,136 |
| investments | ||||
Totalassets | - | 24,711 | 1,033,938 | 1,058,649 |
| Liabilities | ||||
Derivativesusedforhedging | - | (1,822) | - | (1,822) |
Totalliabilities | - | (1,822) | - | (1,822) |
Annual Report 2023 | Page 95
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Page 96 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Annual Report 2023 | Page 97
PRINCESS PRIVATE EQUITY HOLDING LIMITED
| Type of | Fairvalueat | Valuationtechnique | Unobservableinput | Range(weighted | Sensitivity | ||
| security | 31.12.2023 | average) | |||||
| Fair value in thousands of EUR | |||||||
Equity | 948,459 | Market comparable | Enterprise value | 7.50x-35.20x | 78,095 | (78,095) | |
| Instruments | companies | to EBITDA multiple | (16.88x) | ||||
41,685 | Discountedcashflow | Discountfactor | 14.00%-16.75% | 1,312 | (1,312) | ||
| (14.55%) | |||||||
25,046 | ExitpriceRecenttransactionprice | n.a. | n.a. | n.a. | |||
| 15,811 | Marketcomparable | Pricetobookratio | 1.90x-1.90x | 791 | (791) | ||
| companies | (1.90x) | ||||||
| 12,212 | Market comparable Enterprise value to sales | 2.10x- | 20.40x | 761 | (761) | ||
| companies | multiple | (6.81x) | |||||
419 | Reportedfairvalue | Reportedfairvalue | n.a | 21 | (21) | ||
Page 98 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Debt | 4,836 | Discountedcashflow | Discountfactor | 12.00%-20.00% | 55 | (55) | |
| Instruments | (16.03%) | ||||||
| 1,292 | Market comparable | Enterprise value | 11.00x-11.00x | n.a. | n.a. | ||
| companies | to EBITDA multiple | (11.00x) | |||||
| 320 | Market comparable Enterprise value to sales | 2.80x-2.80x | n.a. | n.a. | |||
| companies | multiple | (2.80x) | |||||
81 | ExitpriceRecenttransactionprice | n.a. | n.a. | n.a. | |||
Partnership | 10,333 | AdjustedreportednetReportednetassetvalue | n.a. | 517 | (517) | ||
| Investments | asset value | ||||||
| 454 | Adjustedreportednet | Fairvalueadjustments | n.a. | 23 | (23) | ||
| asset value | |||||||
1,060,948 | Total | ||||||
| (31,889)AmountsfromPartnersGroupinvestmentvehicles | |||||||
1,029,059 | Totallevel3investments | ||||||
| Type of | Fairvalueat | Valuationtechnique | Unobservableinput | Range(weighted | Sensitivity | ||
| security | 31.12.2022 | average) | |||||
| Fair value in thousands of EUR | |||||||
Equity | 930,259 | Market comparable | Enterprise value to | 5.00x-34.00x | 77,861 | (77,861) | |
| Instruments | companies | EBITDA multiple | (15.94x) | ||||
35,721 | Discountedcashflow | Discountfactor | 13.45%-14.30% | 255 | (255) | ||
| (14.17%) | |||||||
| 13,854 | Marketcomparable | Pricetobookratio | 1.68x-1.68x | 693 | (693) | ||
| companies | (1.68x) | ||||||
| 10,201 | Recent | Recenttransactionprice | n.a. | n.a. | n.a. | ||
| financing/transaction | |||||||
| 8,819 | Market comparable Enterprise value to sales | 2.60x- | 22.30x | 424 | (424) | ||
| companies | multiple | (8.23x) | |||||
671 | Exitprice | Recenttransactionprice | n.a. | n.a. | n.a. | ||
455 | Reportedfairvalue | Reportedfairvalue | n.a | 22 | (22) | ||
Debt | 8,994 | Brokerquotes | Indicativequotesforan | n.a. | n.a. | n.a. | |
| Instruments | inactive market | ||||||
7,626 | Discountedcashflow | Discountfactor | 13.00%-23.00% | 165 | (165) | ||
| (15.78%) | |||||||
81 | Exitprice | Recenttransactionprice | n.a. | n.a. | n.a. | ||
Annual Report 2023 | Page 99
PRINCESS PRIVATE EQUITY HOLDING LIMITED
Partnership | 24,272 | AdjustedreportednetReportednetassetvalue | n.a. | 1,214 | (1,214) | |
| Investments | asset value | |||||
| 9 | Adjustedreportednet | Fairvalueadjustments | n.a. | 0 | 0 | |
| asset value | ||||||
1,040,962 | Total | |||||
| (10,891)AmountsfromPartnersGroupinvestmentvehicles | ||||||
1,030,071 | Totallevel3investments | |||||
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Managementfeeexpenses | 15,535 | 13,874 |
PartnersGroupAG | 15,535 | 13,874 |
Administrationfeeexpenses | 474 | 471 |
PartnersGroup(Guernsey)Limited | 474 | 471 |
Servicefeeexpenses | 292 | 208 |
PartnersGroupAG | 292 | 208 |
Incentivefeeexpenses | 11,027 | 18,829 |
PartnersGroupAG | 11,027 | 18,829 |
Incentivefeepaid | (2,125) | (7,528) |
PartnersGroupAG | (2,125) | (7,528) |
Directors'feeexpenses: | 280 | 294 |
Investedamountsanddistributionsfrom/(to)PartnersGroupadvisedproducts(investment | 37,007 | 87,781 |
| side), net |
<>
Page 100 | Annual Report 2023
PRINCESS PRIVATE EQUITY HOLDING LIMITED
31.12.2023 | 31.12.2022 | |
| In thousands of EUR | ||
Othershort-termreceivables | 873 | 666 |
PartnersGroupaffiliatedentities | 872 | 666 |
ReceivablefromInvestments | 1 | - |
Accrualsandothershort-termpayables | (6,364) | (10,006) |
PartnersGroupaffiliatedentities | (6,270) | (10,006) |
PayabletoInvestments | (94) | - |
Accruedincentivefee | (37,733) | (28,831) |
PartnersGroupAG | (37,733) | (28,831) |
InvestmentsinPartnersGroupadvisedproducts | 941,632 | 1,161,416 |
FairvalueofinvestmentsadvisedbyPartnersGrouporrelatedparties | 696,669 | 682,005 |
<>
21 Events after the reporting date
Two additional directors were appointed to the Board after the reporting date: Axel Holtrup was appointed on 15 February
2024 and Gerhard Roggemann was appointed on 21 March 2024.
The Board of Directors is of the opinion that no other events took place between the end of the reporting period and the date
of approval of these consolidated financial statements that would require disclosure in or adjustments to the amounts recognized
in these audited consolidated financial statements.
22 Approval of these financial statements
The Board of Directors approved these audited consolidated financial statements on 22 March 2024.
Annual Report 2023 | Page 101
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Annual Report 2023 | Page 103
20231231 362 E A Cv 2024-03-20 17:53
Administrator
Partners Group (Guernsey) Limited
Registered Office
Princess Private Equity Holding Limited
Tudor HouseTudor House
Le Bordage Le Bordage
St. Peter Port St. Peter Port
Guernsey, GY1 6BD Guernsey, GY1 6BD
Channel Islands Channel Islands
Info: www.princess-privateequity.net
Registered number: 35241
Investor Relations
Partners Group AG
Andreea Mateescu
Zugerstrasse 57
6341 Baar-Zug
Switzerland
Independent Auditor
PricewaterhouseCoopers CI LLP
Royal Bank Place
1 Glategny Esplanade
St Peter Port
Guernsey, GY1 4ND
Channel Islands +41417846673
princess@partnersgroup.com
Investment Manager
Partners Group AG
Zugerstrasse 57
CH-6341 Baar-Zug
Switzerland
www.partnersgroup.com
PRINCESS PRIVATE EQUITY HOLDING LIMITED