Q2 2021 Patria Investments Ltd Earnings Call
[music].
Good day, and thank you for standing by and welcome to the Patria investments second quarter earnings call.
At this time all participants are in a listen only mode. After the speaker's presentation. There will be a question and answer session to ask a question. During the session you will need to press star one on your telephone. Please be advised that today's conference is being recorded and if you require any further assistance. Please press star zero I would now like to hand the conference AUM.
To your speaker today, Josh would head of shareholder relations. Please go ahead.
Thank you good morning, everyone and welcome to the Patriot second quarter 2021 earnings call.
Joining on the call today are Chief Executive Officer, Alex side, and our Chief Financial Officer, Mark Hood volatile earlier.
Earlier. This morning, we issued a press release and earnings presentation detailing our second quarter 2021 results, which you can find posted on our Investor Relations website at IR Dot Patria dot com or on form 6K filed with the Securities and Exchange Commission.
Any forward looking statements made on this call are uncertain do not guarantee future performance and undue reliance should not be placed on them.
<unk> assumes no obligation and does not intend to update any such forward looking statements.
Such statements are based on current management expectations and involve inherent risks, including those discussed in the risk factors section of our form 20-F annual report filed earlier this year.
As a foreign private issuer Patria reports financial results using international financial reporting standards or Ifr S as opposed to U S. GAAP.
Additionally, we will report and refer to certain non-GAAP industry measures, which should not be considered in isolation from or as a substitute for measures prepared in accordance with <unk>.
Reconciliations of these measures to the most comparable measures calculated in accordance with IRS are included in our earnings presentation.
As a quick overview of the results Patria generated $73.4 million and <unk> net income in Q2 'twenty one.
On key non-GAAP measures for the second quarter, we generated fee related earnings of $17.6 million and performance related earnings of $56.4 million driving distributable earnings of $74.2 million or $54 five per share.
In alignment with our policy, we declared a dividend of $46 <unk> per share payable on September 16th to shareholders of record as of September 2nd.
With that I'll now turn the call over to our Chief Executive Officer, Alex site.
Thank you Josh.
We appreciate all of you joining the call. This morning to discuss our excellent second quarter results and outlook.
We are very excited with our progress since the IPO and.
And we have generated distributable earnings of 67.
Per share year to date.
Now with good visibility on fee related earnings for the second half of the year.
Have a clear line of sight to near one dollar per share of distributable earnings for the full year.
Not only are we delivering strong results here in 2021.
Our key growth drivers for the coming years, our welding fact.
Running ahead of our expectations from the beginning of the year.
We are deploying capital faster with nearly $1.8 billion invested or reserve in the first half of 2021.
Equating to an annualized pace well above our historical average.
This deployment acceleration means faster fee, earning AUM growth.
Which is driving 31% fee revenue growth and 19% fee related earnings growth compared to the second quarter of last year.
Faster deployment also means that we are accelerating our fund raising timelines.
And we expect to have a first closing for our next generation private equity fund in the second half of this year.
Our funds are performing even better.
With more than $2 billion of valuation growth across the platform over the last year.
Our net accrued performance fees rising to two $325 million.
We are now delivering an attractive yield to our shareholders.
As evidenced by our realization of $56 million in performance related earnings in the second quarter.
I will now cover some key highlights across our businesses.
The strong deployment environment is again evident in our second quarter activity.
As we invested or reserves more than $1.2 billion in our closed end funds.
That is on top of $550 million in the first quarter.
Bringing the year to date total already to almost $1.8 billion.
In terms of strategies more than $1.2 billion was deployed in our flagship private equity fund and.
And $450 million in our flagship infrastructure fund year to date.
In private equity recent investment activity included new commitments in our thesis areas of cyber security.
Grocery retail.
And coal logistics.
Where we have conviction in our ability to build the market leading businesses in Latin America.
Our current vintage private equity fund is almost fully committed as of June 30.
And well above the threshold that allows us to go back to the market.
As noted.
We expect to begin raising the next generation private equity fund during the second half of this year.
And continue to be optimistic on the opportunity to scale. This further again by up to 50%.
The tiny acceleration is positive for our fee related earnings growth in 2022 and beyond.
And this new revenue stream pulls forward.
Investment performance here continues to be outstanding.
With private equity funds 582015 vintage fund Gen.
Generating a net IRR of 36% in U S dollars.
Which has stopped the style by vintage not just on a Latin America or emerging market basis, but on a global basis.
Private equity funds 682019 vintage fund, which is still in its investment period is already generating an impressive 28% net IRR in U S dollars.
We are excited about the value creation, our world class investment team is delivering.
<unk> will also accrue to shareholders over time as these funds mature.
Our latest flagship infrastructure fund continued to actively commit capital to new projects.
You may have seen our press release, highlighting our growing toll road portfolio.
And specifically our success expanding into Columbia in this space.
Making parts we are now the third largest toll road operator in Latin America.
We take pride in not only generating returns for our limited partners with these investments.
But also in delivering projects that will fill critical needs for our communities and society.
We believe there is an incredibly large and diverse infrastructure opportunities to address in the region.
And patch with scale and expertise allows us to be selective.
We have an ability to tackle complex development projects, where few other firms have the necessary resources.
While we expect to bring the next generation flagship infrastructure fund back to market sometime next year.
Also ahead of schedule.
We are excited to announce plans to launch a new dedicated renewable energy fund in the second half of this year.
This will also be a closed end fund targeted through our global institutional Lps.
Which we believe fills an important Steve of demands from investors, who wants more targeted mandates focus on renewables.
And the accelerating global energy transition.
Fund raising in our country specific strategies should also pick up in the second half of this year.
With opportunities to raise money in credit as well as our real estate investment trusts and infrastructure core vehicles.
These vehicles are denominated in local currency and we see a path to raise about 4 billion Reais this year, including 800 million Reais raise for our infrastructure fund in the first quarter.
About 80% of that would be in permanent capital type vehicles.
Which further contributes to the duration and stickiness of our fee earnings AUM.
On the realization front, our major news for the quarter is the crystallization of $56 million in realized performance fees from private equity funds III.
We are nearing a great outcome for a 2007 vintage fund that has generated nearly a two X two times return and top quartile Latin America and emerging markets performance, while investing through a very challenging time period.
Michael will provide more detail on this realization in a moment.
But I want to congratulate the team who has worked diligently to deliver value both to the limited partners and now shareholders with this one.
Since the quarter end, we also completed the initial public offering a portfolio company smart fit.
A great example of practices approach to value creation and building market, leading businesses through consolidation and geographical expansion.
Smartphones is now the largest fitness club operating in Latin America.
And as one of the nine investments in our outstanding private equity five portfolio.
This initial public offering is another step towards creating liquidity in this fund and being able to realized gains for our limited partners and performance fees for our shareholders.
To put it simply batra is executing on all fronts.
And these examples are only the highlights.
Just scratching the surface of an excellent work our investment teams and portfolio companies are doing.
Let me turn the call over to Mark to take you through the detailed results and then I'll come back for some final words.
Mark the floor is yours.
Thank you Alex and good morning to everyone on the call.
Our results for the second quarter reflect continued progress on our FRE growth drivers.
And an attractive yield for our shareholders, we generated fee related earnings of $17.6 million in Q2, 'twenty, one up 19% from $14.9 million in Q2 'twenty.
Driven by fee revenue growth.
31% over the same period.
We have now generated $34.9 million of fee related earnings on a year to date basis and continue to be very confident in our FRE E growth trajectory for the full year 'twenty one.
Fee earnings AUM was eight 3 billion.
During Q2 'twenty one.
Up.
17% from Q2 'twenty.
Remember that floor at our flagship fund management fees are charged twice per year in.
In our reported fee earnings AUM reflects the basis that is generating management fee in the current reporting quarter.
For funds, where management fees are charged as capital is deployed or reserved the.
The Q2.
Earnings AUM.
We will not yet include the impact of deployment in the first half of the year.
Which will begin to generate management fees in the second half of the year.
Therefore, you can expect less movement in fee earnings AUM and management fees from Q1 to Q2.
But a more substantial change from Q2 to Q3.
As the second half management fees are charged.
And recognized.
Based on the significant flagship fund deployment in the first half of the year, we expect our effective fee earnings AUM for the third quarter to rise substantially to nine four to nine $6 billion depending.
On where some of our country specific strategies land.
That should give you a good indication for the uplift in our second half fee revenues.
Our pending fee, earning AUM is expected to move from two eight building to about one 5 billion next quarter given the have the deployment from private equity fund six.
But this amount will be replenished to even higher levels than before as we begin to raise our next generation private equity fund.
Total assets under management rose to $15.8 billion.
Up approximately $3 billion or 24%.
From $12.8 billion, one year ago.
About $2.2 billion of debt increase or 17 of the 24% was driven by the appreciation in our underlying investments before accounting for the improvements in the Latin American currencies.
Just further highlighting the significant value creation happening in our portfolio.
On that note net accrued performance fees increased to $325 million up.
29% from 253 million last quarter.
And that is after accounting for the realization from private equity fund III.
The accruals for private equity fund five rose to $244 million and that does not yet account for the successful IPO of smart fee.
Which was completed in July also of note the <unk>.
Accruals for infrastructure fund III rose to $48 million.
As the fed moves through the 100% catch up phase.
Of the accrual waterfall.
The continued strength of the accrual should be a positive sign to shareholders.
As it underscores the accumulated value that can contribute to distributable earnings in future periods.
We recognized $56 million of net realized performance fees in Q2 from private equity fund III.
As we return full capital and hurdle to the limited partners and the fund transitions to a liquidation status as we neared the funds termination date.
This particular scenario is somewhat unusual so let me quickly explain what this means and how this impacts the P&L.
As we have noted the remaining assets in this fund consist of shares from one remaining portfolio company, the Brazilian medical Diagnostics company <unk>.
As well as ask growth in receivables from prior exit.
With the full return of capital and hurdle, we effectively fulfilled our obligations to lp's, leaving the remaining fair value of the fund equivalent to our performance fees earned as of June 30.
While the monetization of the underlying assets and ask growth will occur in future periods.
Performance fee crystallizes as a liability to the fund and as a revenue and an asset to Patriot.
Given the end of the lifecycle status of the fund.
We are recognizing as realized performance fees and distributable earnings in Q2.
Future amounts received upon monetization may vary from the amount being recognized this quarter and any difference will be recognized throughout distributable earnings at this point in time.
Underscoring the active nature of the divestment process for LDR just earlier. This week there was a non solicited public tender offer by a third party to acquire <unk> shares at a price consistent with the June 30 valuation.
Putting that altogether for the quarter distributable earnings were $74 million.
Or 54 five cents per share.
And as noted we will pay a dividend of <unk> 46 three per share.
Combined with the first quarter dividend this amounts to a yield of more than 3% just year to date based on our IPO price.
No.
Let me give some perspective looking forward on how our current momentum is shaping the road ahead.
As noted we expect to begin raising our next generation private equity fund in the second half of the year.
Along with launching the new renewable energy fund and raising more capital in certain country specific strategies, all of which will have little impact on the 2021.
But are positive drivers for the 2022 earnings and beyond.
Our net accrued performance fees continue to build and private equity fund five is poised to be the next major driver of realizations.
While the timing is always difficult to predict we're making key steps towards liquidity.
And our expectation for these funds future contribution continued to grow.
On the M&A front, while there is nothing to be announced at this time, we continue to be very active in our efforts and pleased with our progress toward putting our IPO capital to work for fee related earnings we expect an uplift in the second half of the year as first half.
Deployment drives the effective fee earnings AUM to near the $9.5 billion level with this greater visibility on the second half we feel confident that fee related earnings will exceed $75 million for the full year 2021 with a margin.
In the mid 50% range.
Combined with performance earnings generated in Q2 that outcome with a ready lenders close to that $1 per share of distributable earnings for 2021.
Which Alex highlighted at the beginning of this remarks with that I will turn it back over to him for some closing thoughts.
Thank you Marco.
Just to put that outlook in perspective.
Distributable earnings outcome near $1 per share will generate a dividend yield of approximately 5% to an investor in our IPO.
And that is nearly four times the current dividend yield on the S&P 500.
Okay.
When you consider the batteries overall growth opportunity and the growth rates for revenue and fee related earnings that we are already demonstrating we believe our stock sits at an attractive valuation today.
Looking across our industry at the second quarter results you just have to be impressed with the momentum across the board.
The secular trends driving capital to alternative investments and private markets. In particular are strong and we believe patria is harnessing the strength just the same.
While we are newer to the list of publicly traded names and still introducing ourselves to the market in many ways.
We are certainly not new to the business.
We have grown our AUM at 18% per annum since 2009.
And since our inception have raised six funds vintages in private equity and four in infrastructure.
With the next generation sooner underway.
Even with our established track record.
Want to stress that our growth story is still in its early chapters.
We believe private capital and alternatives are Underpenetrated in Latin America compared to developed markets around the world.
And Patrick is better positioned than anyone to meet the rising demand and deliver world class investment expertise in our market.
We see a compelling growth and expansion opportunity for our platform in the coming years.
And we are confident that we have the resources and leadership in place to capitalize.
Our significant shareholders ourselves rest assured that we are highly aligned and we look forward to sharing this journey with you.
We're now happy to take your questions. Thank you.
Yeah.
Okay.
Ladies and gentlemen, as a reminder to ask a question you will need to press star one on your telephone.
To withdraw your question press the pound key.
These standby, while we compile the Q&A roster.
Yes.
Our first question will come from the line of Robert Lee from K B W.
Begin.
Good morning. This is murdo I'm filling in for Rob. Thank you for taking my question.
My first question is on performance fees.
And where might we expect that performance fees come from.
Next year as well as the outlook for the second half of this year.
No that <unk> five is just entering harvesting should we expect some of those fees in 2022 are not until 2023.
Any color you might be able to provide on that piece would be great.
Okay.
Thank you very much this is Alex here and thanks for all.
Also participating in this call.
We are very excited with the performance of our private equity funds five you can see from the presentation given today.
We are.
Able to exit from some companies and going to be able to we were able to IPO.
Major asthma from five which would be.
Health club chain smartphone.
And I think we believe that we believe that we are building.
Exit signs on five start delivering performance fees in 2022.
It's a 2020, so our our projected spheres are.
For performance fees.
For private equity firms.
22 of course, some of that some of that performance fee will be realized in 'twenty two 'twenty three.
To start you know no.
All projections are too.
To affect positively our distributable earnings in 2022.
I hope I answered your question.
Great. Thank you Allen.
If I could ask one on fund raising as well.
No that does.
Question for Lee.
Largely deployed right now how how close are you to fund raising and Frac Clive.
Okay.
Thank you Michael again for the question I think we are.
Very very positive.
Starting our fundraising.
One reason for infrastructure from five.
Sometime next year.
We did.
Several projects.
Just mentioned.
But the way that our infrastructure fund works, we do commit to a project like when we a concession.
I'll be Brexit position.
We then deploy that capital over time, so we would like to deploy more capital.
Before August.
Officially started off on raising right.
Now we are.
Close to 70, 580% committed with approximately 20, 20% deployed.
Because of the mechanics that I just explained.
The compression and then you're going to build up the capex. So you deploy capital over the next quarters. After you win the compression.
So again, we would like to push that number higher than that.
One, 8%, which is exactly what will happen.
And because we want the concessions how are we going to have to deploy the capex stuff I mentioned.
So that puts us in a better position.
So let's talk about the rate next year.
Barclays too.
Look at the OXXO deployment percentage not all not only the committed percentage north funds.
However.
We did in the meantime.
Thank you.
If you.
If you heard Michael So my comments here during the presentation.
We decided that we as.
Renewable energy fund this year.
We are having.
Okay.
A reasonable success that sounds easy process.
As investors are looking to more targeted mandates.
This speaks to the renewable energy space at the energy transition space.
So we're going to focus in a raising debt this year.
While we deploy more capital.
Flagship infrastructure fund four.
And Scott leading infrastructure fund five next year I Hope I answered your question.
Great that makes a lot of guidance. Thank you.
I could just squeeze one more in on margin.
Know that our forecast was light on G&A and it was also up from last quarter.
Were there any onetime items in the quarter or is this the right.
Run rate to use going forward.
Yeah, I can take that one margo and thank you this is marco.
So.
FRE margin, so you should expect us.
Having around.
55% FRE margins for the entire year, there has not been any one offs for the quarter, if youre comparing to the previous year I just want you to remind you that versus the previous year. There is a there's actually a change.
In compensation structure relative to two top two through 2020 that accounts for the dividends that now transition to be part of our.
Personal expenses, but all in all ex overall expenses have been very.
Aligned with what we have last year and there's nothing that's really worse and attention here.
Okay. Thank you so much for taking my questions.
Our next question comes from the line of peaceful BARDA from Goldman Sachs you may begin.
Hi, Good morning, guys. Thank you for the call congratulations on the strong results.
A couple of questions also I guess first on the fee related earnings I understand.
Deployed more capital then we should get a nice uplift in the second half of the year just to think about I guess the management fees as a percentage of net fee, earning AUM should we expect sort of a similar ratio as you saw in the first half of the year and any changes to sort of.
The fees that you learn.
On the fee, earning AUM.
The point just to get a sense on how that should look and then second question also on the performance fees just to clarify so the realized performance fees this quarter.
Mostly from <unk>, but with the tender offer from ready toward I mean is there more that you can potentially realize this year just want to clarify in terms of second half of the year and any performance fees that we might be able to expect thank.
Thank you.
Hi, Tito this is Marc again, so on the management fee, what I would encourage you to pay attention to is on the.
On the expected fee earnings AUM for the second half of the year. If you look at the presentation that we shared with you earlier today on page 13, what we show is that we have a nine 4% to nine points six feet.
Earnings AUM and that should be the driver.
The management fee for the second half of the year, which is a substantial increase versus the first half of the year, where actually the second Q for 'twenty, one which was eight.
8.3, so the those dynamics will be driving most of the feet.
The management fee for the second half of the year.
And relative to the performance fee.
As Alex indicated before the Max a fund to be generating performance fee for us would be mostly.
Private equity fund fine, which I know that there has been a substantial increase in net accrued from last quarter, when we had $182 million in now.
Closing 244, so 34% increase and that's the result of the.
Massive appreciation of the portfolio.
But besides that is interesting to note that Theres has been has been also a substantial increase coming from infrastructure Fund III.
When we last quarter, we had $9 billion in this quarter. We are presenting 48.7 million in this quarter to 48 million and also on private equity.
6K.
Came all the way from 15% to 31.
So private equity fund five.
Yes.
Alex indicated completed an IPO.
Mark fields, we have divested from another company.
There's been very good traction in terms of activities and with the different possibilities within defense. This is a fund that has nine companies now and.
When I look through the assets of this fund I see multiple possibilities. We don't think that we're going to realize performance fees from fund clients. This year. So it's mostly concentrated next year. So that means that there is there is a greater amount, but slightly delayed to the next year.
Thanks, Michael that's helpful. That's clear.
Just one follow up on the fee, earning AUM, yes, I understand the pickup in the second half of the year I guess the question was more related to the.
The management fee is a one 6% annualized.
This quarter should we expect that percentage to remain similar in the second half of the year. So REIT as you have been $9.49 six.
Management fee around one 6%.
Is a reasonable number to expect as well.
Yeah.
Hey, Rob This is Josh just one thing to add there to think about is.
On the infrastructure fund the fee rate is actually a blend where a portion of the fee is charged on commitments and a portion of the fee is charged on deployment. So you will get some increase in the effective rate for that fund as it deploys capital, but generally it's going to be close to the rate <unk> seen over the past few quarters. So that's one additional thing.
Consider that could cause it to bump up just a bit.
Okay. That's great. Thank you.
All in all you shouldn't expect any relevant change in the pattern.
The management fees.
Got you okay, great. Thanks, Thanks, Josh Thanks, Mark.
Yeah.
Once again Thats star one for a question Star one.
Next question will come from Ryan Ricardo, which Glenn from the PG Peg Dorian you may begin.
Good morning, everyone and congrats on the results.
First I wanted to understand a little bit of bad there.
And there'll be a presentation on the realization of.
The country in terms of performance.
From its peak of that right.
And then understanding correct me if I'm wrong.
You still have the <unk> income.
Income receivables and this thing, but basically you expected monetization should expect in the future and whether it'd be committed from the Delta right.
I just wanted to understand what is the difference from from that.
Sure.
Created performance seen in the balance sheet and and.
And also from my second question I wanted to understand a little bit better.
Then as far as I understand one of the goals that you had an IPO, let's just as far as some M&A opportunity.
Strategy that franchise, and particularly outside Brazil.
So as you know if you have any update on that and if there's any.
Ongoing negotiation, then what kind of assets.
It would make sense for us to expect.
Does Europe, perhaps followed following years. Thank you.
Thank you maybe I, maybe I can help you on the first question as well.
Thanks for your question and nice to talk to you.
This is Alex again.
Our folks we win.
Was going into liquidation liquidation mode as we call it here.
And all in our industry.
Which means that as of June of this year.
Good.
<unk> distributes to investors.
All of the principal investigator, Dr hurdle and the costs.
From that moment on that was June.
This year from that moment on.
This firm has a full catch up.
All of the money that comes.
Into the pharma that's distributed now.
Up to.
$86 million in this case.
That could quickly.
<unk> to the general partner goes with Patria.
100% of full gotcha.
Firms in this one.
After that.
We distribute the money on an 80.20 basis.
In addition to Q2 this whole distribution modes, which is different than the other funds where the funds are still.
So we are accruing.
Performance fees.
We were working very actively.
So let me ask about the phone, which is the share of audio.
The medical diagnostics company treated in our Brazilian stock exchange.
As you can see that this has been a very active.
That's a process.
The tender offer was.
That was made public this week.
To buy from a third party to buy.
Shares.
Very much in line with the price per share that we have.
Sounds good.
Performance fees in June 30 of this year.
So we expect to see.
Realizations coming from yes.
RBR shares.
Then the remaining assets of the firm.
As already.
Given because it.
This decrease receivables or announce.
From prior.
Sales of companies.
In private equity.
That has already been signed fully committed with just a question of <unk>.
<unk> that money.
Which will probably come in of course in the first quarter.
2022.
So we've got very concrete.
Moments like this one.
Sure.
Liquidation mode.
As we explained during the call.
Dan.
Allan Cooke four.
<unk>.
Our second quarter results.
To realize the other unrealized performance fee that you mentioned.
They are not.
In that same stage on the fund by fund basis, we were talking about for example contract compliance during the call here today, you know a Q&A session.
We're building that.
Realized performance fees, but for example in private equity from core from five we have not in terms of capital yet so we have to sell companies and perhaps a return to capital and then how soon.
In terms of hurdle on costs, and then we start that charging performance fees.
Because of the very different nature and moments, that's one fund stands versus the other.
That's why we've been accounting for it.
Realized performance fees in addition to the.
Right.
But we have.
Actually realizing.
Resources.
Beyond your shares.
Then your second question on the M&A front.
Also can help me here I see that you had.
Absolutely.
We're very very active.
And we're looking to expand our product offering.
Our geographic footprint.
We don't have anything to announce at this moment.
But we are extremely active in those two fronts.
Product offering not only products.
Brazil centric strategy for the Brazil centric strategies with also province.
But we will also have a Latin American exposure.
Of course loans, you're driving on a geographic footprint expansion.
Not only.
Brazil, <unk>, Brazil of course.
Outside of Brazil anything to comment there Michael.
I will just add that what you should expect is consistency with what we have announced during the IPO and what we're looking for bringing into Patrick with our acquisition program, which would be geographical competences disc.
<unk> distribution channels and new products.
<unk>.
As Alex indicated we've been actively working on this and we've been active.
Finally, I will use.
And working through negotiations, but there is nothing to be announced at this stage.
Yeah.
Thank you very clear.
Okay.
And our next question will come from the line Domingos.
Savana from Jpmorgan you may begin.
Thank you good morning, guys.
Thank you.
Very final question actually.
The $86 million sort of GAAP.
On the performance in issue.
We still delivered above that so let me add to the answer another question or two.
Performance booked.
Now on the liquidation of the fund and so quickly.
It came in.
Very close to a tender offer.
Being done for the assets.
My question here.
Is there any discussions on any potential premium for the control.
I think thats fully meet them.
A little bit.
So it is contemplated in this performance the combination as well and how have you seen the standard and the second one is we obviously have seen.
Rising interest rates in Brazil right.
And I mean asset prices come down which embedded for acquisition.
I'm guessing it might change a little bit your perception on sectors, which might become more less compelling as you unwind Europe next dollar investment strategy.
My question is on that list.
Changing environment in Brazil.
What makes your Europe the sectors more compelling in the sector is less content.
Well, thank you very much good income.
Nice to talk to you again.
We are.
Continue we continue to be very excited with the sector.
Core focus of Patria.
Even as we move along.
Into the year, and we see what's going on with our country.
Other countries in Latin America.
Gnomic median politically.
Health care continues to be.
Very very very important area of focus for us.
And I think we're different than.
But even more even more so stressed.
Yes.
All of our countries have to invest more in health care.
And this very exciting strategy that we're looking for them.
In Brazil and outside of Brazil in this sector in this industry.
Also I think on the on the infrastructure side.
We have been very active on the logistics front.
Probably no.
Several governments around the around the region.
All diversifying from public assets.
Mainly on the area.
We are a focus for us which is to just just because the main main area of focus for US. We are now the third largest mobile operator in Latin America, we just want to concessions.
Actually one concession that we did acquire another asset in Colombia.
So logistics.
The major area of focus for us and I think going forward as.
As you mentioned, we got rising interest rates you know.
But these the logistics assets are.
So the toll roads.
Fees and some also logistics philosophy the energy sectors.
Weapons are linked to inflation.
So that the wholesale business.
Interesting.
We will hedge.
Our investments in <unk>.
These two sectors.
So going back to profit actually I think we're also extremely well and continue to be very excited with logistics on the Brexit rectified.
We have been investing in logistics for example around the region, which is a major issue.
Of course increases because we see energy prices going up in coal logistics is very defensive.
With energy.
Well again, I think we haven't changed our focus and I think as we see.
These countries these countries progressing coming back very strongly from Pennsylvania.
All of them most of the other countries in Latin America right now.
Reviewing the GDP growth for 2021.
<unk>, Brazil.
From what we expected at the beginning of this year.
So again.
Citing moment to be investing in Latin America to be honest.
Well, there's a lot of gaps.
Not a lot of capital.
Jason the deals, which puts us in a very privileged position to be honest.
Say, even more so on the infrastructure side, which is there's less competition.
Oh, <unk> I hope I answered your question here.
Oh, you did a very clear.
Thank you and congrats on finishing the recycle them easily.
Yeah. Thank you very much and.
<unk> thousand seven vintage wells.
We do like to praise the team for an amazing effort 2007 vintage funds.
Tough moments, which were.
That's helpful in the crisis as you know.
And we managed to deliver a top quartile.
Not only Latin America, but emerging markets ranking.
We're extremely proud.
<unk> net.
In U S dollars for our investors, which is.
It's something that makes us very very proud given the vintage offer something thank you.
Okay.
Thank you.
I see no further questions in the queue I'd like to turn the call back over to Alex for any closing remarks.
Well, thank you very much for your patience and participating in our call.
As we.
Mentioned here, we're extremely excited with our results.
We are now.
67 cents.
Or earnings per share here.
For the year to date.
This puts us in a very very good position here.
Two.
We deliver what we've mentioned here and several.
Different locations during this call maybe one dollar per share.
For 2021.
Which represents approximately 5% of Oh.
Dividend yields to our investment in our IPO, so extremely proud of the results.
As we move forward into the year actually were.
More and more looking into 2022, well given our business, which is very predictable very.
Reliable.
The new sources as you guys know that Nymex industry, So our second half of Europe.
As far as <unk>.
Our fee related earnings is basically there and that's because as we charge fees.
Beginning of the semester, which knows.
A couple of weeks ago, we're looking to buy and I look into 2022 I'm very excited.
The fund raising for private equity funds from seven am losing.
Losing a renewable energy farm income Supreme Court.
Next year Awesome laden construction from five hour, Brazil, Brazilian centric strategies.
Extremely well.
We got to above our expectation so that puts us in a good position to finish the year on a dollar per share.
Movable earnings and look into 2022.
I would say optimistic view.
Thanks, again, and I hope all of you and your families are well and safe.
Good day, thank you.
This concludes today's conference call. Thank you for participating you may now disconnect.
Okay.
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Yes.
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