Update on Partners Group
March 2021
Gonzalo Fernández Castro Private Equity Americas | Hal Avidano Co-Head Private Equity Integrated Investments Americas UPDATE ON PARTNERS GROUP 2
Table of contents
1 Overview
2 Clients
3 Industry
4 Investments
5 ESG
6 Financials OVERVIEW 3
About us
Dedicated to private markets Leveraging strong resources
• Our AuM stands at USD 109 billion:1 USD 52 billion in • We have over 1,500 employees worldwide2 across 20 corporate equity & USD 57 billion real assets / financing offices and over 750 private markets professionals
• We leverage our database of over 36,000 private markets • Our platform, portfolio and network provide extensive assets to generate attractive deal flow synergies and opportunities for owners and entrepreneurs
We have a global presence with 20 offices across key investment regions
Tokyo
Shanghai Seoul Toronto Dubai Denver London New York Mumbai Guernsey Luxembourg Manila Houston Munich Paris Singapore Zug Milan São Paulo Sydney
Americas Europe Asia Pacific
For illustrative purposes only. Source: Partners Group (2020). 1 Unaudited, inclusive of all Partners Group affiliates, as of 31 December 2020. 2 As of 31 December 2020. OVERVIEW 4
About our portfolio
Partner to business Entrepreneurial ownership
Corporate assets (USD 52 billion AuM1) Healthcare Industrials Consumer & services Technology
Real assets / financing (USD 57 billion AuM2) Infrastructure Real estate Real asset services Financing
We are "responsible for the dreams" of the 200,000+ partners and employees who work alongside us in our portfolio
For illustrative purposes only. Source: Partners Group (2019). 1 Corporate equity includes Partners Group's private equity asset under management as of 31 December 2020. 2 Real assets / financing includes Partners Group's asset under management relating to private real estate, private infrastructure and private debt as of 31 December 2020. OVERVIEW 5
The Partners Group formula
Attractive industry Partners Group business model
Rising private Institutional Outperformance Multi-asset class markets asset growth across cycles offerings allocations + Complex client Globally needs/market integrated service consolidation organization
Competitive shareholder returns
Continued x Stable + Balance sheet- = Earnings ≈ Dividend AuM growth margins light approach growth growth
Source: Partners Group. UPDATE ON PARTNERS GROUP 6
Table of contents
1 Overview
2 Clients
3 Industry
4 Investments
5 ESG
6 Financials CLIENTS 7
Around 900 institutional organizations as clients
Public pension funds and sovereign wealth funds Insurance companies
Private pension funds Banks and distribution partners
We are "responsible for the dreams" of our 200+ million beneficiaries
Clients listed include direct clients of Partners Group (USA) Inc., Partners Group AG or their affiliates, and investors in funds managed or advised by such parties. Clients listed were selected to demonstrate the breadth and types of clients served by Partners Group. Inclusion in the list does not indicate approval or disapproval by any of the clients of Partners Group or the services rendered by Partners Group to the relevant client. As of 31 December 2019. CLIENTS 8
Our sustainable returns and service excellence are expected to drive future growth
Total assets under management1 (in USD billion)
+16% 109 Private AuM 16 94 infrastructure 1533 # employees Private 83 1464 17 real estate 74 +5%
1203 25 Private 57 debt 50 1036 43 45 930 37 840 31 746 24 28 701 Private 22 625 52 18 574 equity 11 447 334 361 6 273 137 175
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 Initial public offering
Note: assets under management exclude discontinued public alternative investment activities and divested affiliated companies held up to 2013. 1 Partners Group aims to mirror the fee basis for its various programs and mandates when calculating AuM. AuM covers programs, mandates and assets to which Partners Group renders (full or partial) investment management or advisory services, but does not cover consultant, transaction or other ancillary services it may render to clients or assets from time to time. AuM is typically calculated as either i) the program size, ii) outstanding commitments to investments, iii) the net asset value or the outstanding principal of investments, or iv) the respective investment exposure. The AuM basis is increased by the amount of assets raised that are based on i) subscriptions, or ii) new fee-paying assets and amounts planned to be invested which would become fee-paying assets in the following six months. Reductions in the AuM basis for mature programs i) may follow a fixed schedule, ii) can be based on the cost of realizing assets, or iii) may be the result of such programs being liquidated. The AuM basis is also reduced by redemptions on open-ended programs. Further changes in the AuM basis may be explained by factors such as performance or changes in FX rates. Source: Partners Group (2021). CLIENTS 9
Bespoke client solutions remain the largest constituent of our AuM
Assets raised during 2020 AuM as of 31 December 2020
Private infrastructure Private infrastructure 22% 14% Private real Private equity Private equity Private real estate USD USD 40% 48% estate 16 billion 15% 109 billion 15%
Private debt Private debt 23% 23%
Traditional Bespoke USD Traditional USD Bespoke client programs client solutions 16 billion 109 billion client programs client solutions 36% 64% 42% 58% Evergreen programs (26%)
Note: Mandates AuM include commitments by select mandate clients into traditional programs; therefore, the corresponding amount is not included within the AuM category traditional but within mandates. Source: Partners Group (2021). CLIENTS 10 Solid client demand and performance led to 11% AuM growth in 2020, excluding FX effects; net AuM growth stands at 16%, including FX effects
Total assets under management development (in USD billion, except where stated otherwise)
+16.0 -8.1 +7.1
= EUR 89.2 bn Tail-downs: -6.2 FX +4.9 USD 109.1 = CHF 96.4 bn H2: 7.7
Redemptions: -2.0 Others +2.2 USD 94.1 H1: 8.3
Performance- Typically based on a formula Net redemptions are Driven by the related effects on in traditional closed-ended typically limited to 20- Euro appreciation select programs programs which was pre- 25% p.a. of the of 9% against the that link their AuM agreed with clients at the prevailing NAV for US Dollar to their NAV time of contract. evergreen programs. (EUR AuM: 47%). development.
2019 New money/ Tail-downs & FX & others2 2020 commitments redemptions1
1 Tail-downs & redemptions: tail-downs consist of maturing investment programs (typically closed-ended structures); redemptions stem from evergreen programs. 2 Others consist of performance and investment program changes from select programs. Due to rounding, some totals may not correspond with the sum of the separate figures. Source: Partners Group (2021). CLIENTS 11
AuM stem from an international and broad range of clients
AuM by region (as of 31 December 2020) AuM by client type (as of 31 December 2020)
Asia Australia Distribution 6% 7% Switzerland partners / private Middle East 16% individuals Public pension 3% 18% funds & SWFs 24% South America Germany & 2% USD Austria Asset managers, USD North America 109 billion 16% family offices, 109 billion 16% banks & others France & Benelux 19% 6% UK Southern Europe Corporate & other 21% Scandinavia Insurance 4% pension funds 4% companies 10% 29%
Note: due to rounding, some totals may not correspond with the sum of the separate figures. Source: Partners Group (2021). CLIENTS 12
AuM well-diversified across programs and clients
Breakdown by private market programs and mandates1 Breakdown by client and program structure1
Largest client 3% Top 2-5 clients 7% Top 6-10 clients 5% Top 11-20 clients USD >850 other 7% 109 billion USD institutions 78% 109 billion (around 300 programs & mandates)
Traditional Bespoke USD client programs client solutions 109 billion 36% 64%
Evergreen programs (26%)
Note: due to rounding, some totals may not correspond with the sum of the separate figures. 1 Assets under management as of 31 December 2020. Mandates AuM include commitments by select mandate clients into traditional programs; therefore, the corresponding amount is not included within the AuM category "traditional client programs". Source: Partners Group (2021). CLIENTS 13
Our portfolio management enables clients to reach their targeted exposure
Investment-level steering to achieve target allocation
Risk Return potential management through asset allocation
Cash management & Access to multi-asset FX hedging class platform
Outperformance through relative value investing
For illustrative purposes only. There is no guarantee that similar investments will be made. The investment selection is not an exhaustive list. Source: Partners Group (2021). CLIENTS 14
We are leaders in constructing highly customized private markets portfolios
Strong growth in bespoke solutions Sustainable growth in traditional offering
Evergreen programs Mandates Traditional programs (in USD billion) (in USD billion) (in USD billion)
50 50 42 39 40 40 40 35 28 17% p.a. 12% p.a. 30 30 30 25 27% p.a. 23 20 20 19 20 15 9 10 10 10 5 0 - 0 2015 2020 2015 2020 2015 2020
Highly sophisticated offerings that are tailored to Traditional closed- clients' needs and steered by portfolio management ended structures
Note: Growth p.a. represents the CAGR of AuM by the respective program structure over the period 31 December 2015 – 31 December 2020. Mandates AuM include commitments by select mandate clients into traditional programs; therefore, the corresponding amount is not included within the AuM category "traditional programs". Source: Partners Group (2021). CLIENTS 15
Evergreen programs and mandates increase longevity of our AuM
Illustrative example
Evergreen programs Mandates Traditional programs
Investment decision Strategic allocation decision Commitment decision (in USD) (in USD or % of overall AuM) (in USD)
Exposure re-up? invest more, Exposure increase? maintain maintain Exposure invest or liquidate?
build up commit
y1y2 Y15+ y1y2 y12 Y15+ y1 y2 y10-12
Investment manager diversifies for clients Clients diversify across across private markets asset classes investment managers
Source: Partners Group (2020). CLIENTS 16
Surveys show that there is sustained long-term demand for private markets solutions1
Investors' intentions for their Partners Group private markets allocations by 20251 private markets solutions2
Decrease Maintain Increase
Private -4% 96% Evergreen Mandates equity USD 28bn USD 42bn
Private -8% 92% debt
Private -15% 85% real estate
Private -9% 91% Traditional infrastructure USD 39bn
1 Source: Preqin (November 2020), Special Report: The Future of Alternatives 2025. 2 As of 31 December 2020. Mandates AuM include commitments by select mandate clients into traditional programs; therefore, the corresponding amount is not included within the AuM category traditional but within mandates. Source: Partners Group (2021). CLIENTS 17 Confident outlook on expected client demand in 2021, assuming current uncertainties around COVID-19 improve as the year progresses
AuM, client demand and other effects (in USD billion)
Full-year 2021 expectations
16 - 20 Client demand
+16.0 109 +16.5 94 Tail-downs & +15.7 ~ -9.5 83 redemptions1 +15.0 74 -8.1 -7.1 +7.1 57 -5.6 +/- FX & others2 FX & others2 (no guidance provided) -4.0 +1.4 FX & others2 -1.2 = Total AuM -6.2 FX & others2 FX & others2
2017 2018 2019 2020 2021
1 Tail-downs & redemptions: tail-downs consist of maturing investment programs (typically closed-ended structures); redemptions stem from evergreen programs. 2 Others consist of performance and investment program changes from select programs. For illustrative purposes only. Due to rounding, some totals may not correspond with the sum of the separate figures. Source: Partners Group (2021). UPDATE ON PARTNERS GROUP 18
Table of contents
1 Overview
2 Clients
3 Industry
4 Investments
5 ESG
6 Financials INDUSTRY 19
Partners Group’s market positioning
Asset classes Private equity, private real estate, Private markets plus: hedge Public private infrastructure, funds, high yield, principal equities & private debt investing bonds
Private markets More More global investments firms
Asset class focused
Global financial conglomerates Global financial conglomerates
Regional/
thematic More
thematic focused
Note: this depiction does not purport to be final and complete and is shown for illustrative purposes only. There are many more market participants which could be named and positioning of the logos is based on Partners Group’s assessment and might not correspond with the assessments of the market participants. Source: Partners Group. For illustrative purposes only. UPDATE ON PARTNERS GROUP 20
Table of contents
1 Overview
2 Clients
3 Industry
4 Investments
5 ESG
6 Financials INVESTMENTS 21
Our private markets outlook for 2021: "Offense remains the best defense"
For illustrative purposes only. Note: bullet points in black highlight Partners Group focus areas. Source: Partners Group Private Markets Navigator, Outlook 2021 INVESTMENTS 22
We develop concrete investment opportunities in more than 50 themes in PE alone
1 Automation/Digitization 2 New living 3 Decarbonization
Industrial Robot/ Web Biological / Robotic Process Humanization Emission Industrial Collaborative Data Analytics InsurTech Management Natural Automation of Pets Purification Software Robot Platforms Alternatives Protein Folding Post-Acute Verticalization E-Commerce Behavioral Supply Chain in Bio- Smart Buildings In silico R&D Bioplastics Health IT of Software Logistics Health Post C-19 manufacturing
Digital EV/AV Next Generation Life-Long Tracing and Remote Patient Energy Machine Vision Telematics Consultancy Infrastructure Therapies Learning Tracking Monitoring Efficiency
Machine Regulatory & Next Gen Proactive Everything-as-a- Digital Reverse Supply Pre-owned / Learning in Compliance Performance Retirement TeleHealth Service Governments Chain Re-buy Diagnosis & Care HealthTech Materials Provision Omnichannel Distributed Low Code/ Hybrid Learning Plant Based Residential Rising Building Remote & Site- Financial Manufacturing / No Code Models Meat / Dairy Services Outpatient Automation less Trials Services 3D Printing Predictive Health Analytics Outcome & Waste-to- Next Generation Alternative Internet of Green Maintenance / & Outcome Value-based EdTech Energy / CRM Delivery Models Things Hydrogen IIoT Prediction Care Recycling
Private equity directs team grouped into four sectors: Goods & Products Technology Services Health & Life
Thematic investing: offense is the new defense
Abbreviations: CRM = customer relationship management; EV/AV = electric / autonomous vehicles; IIoT = industrial internet of things. Source: Partners Group (2021). INVESTMENTS 23
Private equity: COVID-19 is amplifying transformative trends
Investment strategies Select transformative trends & focus areas Transformational investing Future of agriculture: Population aging & vision Outsourcing with a sustainability healthcare nearshoring setup Platform companies where we buy add-on firms Non-cyclical industrials Consolidation: healthcare Pharma outsourcing to grow the platform
Market leaders with strong products or services
Leading developer, Largest vertically integrated Pharmaceutical services manufacturer and supplier of medical vision services outsourcer offering packaging Resilient businesses differentiated crop lifecycle provider in the US and clinical & drug with strong defensive management solutions manufacturing services capabilities HQ: Iberia, Spain and Portugal HQ: St. Louis, USA HQ: Philadelphia, USA
For illustrative purposes only. There is no assurance that similar investments will be made. Rationale: examples reflect recent investments in companies benefitting from transformative trends in sub-sectors with high relative value attractiveness. Source: Partners Group (2021). INVESTMENTS 24
Private debt: continued strong demand for private lending solutions
Investment strategies Illustrative attractive sectors and opportunities Lending with an ownership mentality Better debt terms in Direct loans to mid-sized Opportunistically resilient sector companies capitalizing on volatility Creative structures tailored to meet working Unitranche / healthcare Second lien / IT Liquid senior loans1 capital needs Project Tangerine Project Python
Attractive sub-sectors where we have depth of experience
European developer, Provider of cloud-based Selectively considering manufacturer and supplier of communication & collaboration, bespoke solutions for Cross-border hygiene and disinfection remote working and remote companies with immediate solutions products helpdesk support solutions capital needs local support for sponsors HQ: Hamburg, Germany HQ: Boston, US
For illustrative purposes only. There is no assurance that similar investments will be made. Rationale: examples reflect recent investments in a company benefitting from transformative trends in sub-sectors with high relative value attractiveness. 1 Source: Credit Suisse. S&P LCD. Bloomberg. (May 2020). HY spreads, loan spreads, loan yields and loan prices are as of the date in the given year with the widest spread level. Source: Partners Group (2021). INVESTMENTS 25
Private real estate: growth cities will continue to attract companies
Investment strategies Select transformative trends & focus areas Situationally- driven approach Growing Gentrifying hubs in Business-friendly E-commerce expanding cities locations, low cost base Select growth cities focused on tech and Manager diversification Generational shift Investor fatigue education Industrial portfolio Residential Office1
Source off-market through our industry network
Acquisition of 11 geographically Recapitalization of seven Acquisition of eleven class-A, diversified industrial properties residential assets ESG-compliant, newly Drive value creation & 2 development opportunities developed office properties at asset level to enhance Location: Northern NJ; Denver, Location: Copenhagen, Location: Krakow and NOI growth CO; Philadelphia, PA; 5 others Denmark Wroclaw, Poland
For illustrative purposes only. There is no assurance that similar investments will be made. Rationale: examples reflect recent investments in assets benefitting from transformative trends in sub-sectors with high relative value attractiveness. 1 The investment in office is subject to closing. Source: Partners Group (2021). INVESTMENTS 26
Private infrastructure: fundamentals remain broadly unchanged by COVID-19
Investment strategies Select transformative trends & focus areas Proactively building value Clean power New Digitized generation mobility economy Platform expansion offers the opportunity to Renewable capacity build-out Mobility & e-payment services Communication infrastructure build scale
Building core where strong fundamentals support demand
Construction /development Pan-European leader in Designer, installer and operator Operational value comprising 61 3.7MW turbines electronic toll collection of open-access fiber network in with a total capacity of 226MW services provider rural areas creation through growth and Country: Australia Country: Italy Country: Canada and France efficiency improvements
For illustrative purposes only. There is no assurance that similar investments will be made. Rationale: examples reflect recent investments in a company or an asset benefitting from transformative trends in sub-sectors with high relative value attractiveness. Source: Partners Group (2021). INVESTMENTS 27 Our investment activities slowed in 2020 due to COVID-19; however, our pipeline of new investment opportunities is strong going into 2021
Partners Group's private markets investments1 (in USD billion)
Portfolio Sec.Prim. 19.3 assets 16% Direct 33% USD Sec. Equity Prim. 8.6 billion Equity assets 43% 14.8 17% 2020 67% 13.3 H2 11.7 DebtDebt 24% 9.7 H2 H2 8.6 Asia-Pacific / RoW H2 H2 7% H2
North USD H1 H1 H1 America 8.6 billion H1 H1 H1 53% 2020 Europe 40% 2015 2016 2017 2018 2019 2020
• Underlying portfolio realizations of USD 11.8 billion driven by cash distributions from closings
1 USD 3.7 billion invested in 16 equity investments and USD 2.1 billion invested in 35 debt investments in 2020. Figures include add-on investments but exclude investments executed for short-term loans, cash management purposes and syndication partner investments. Direct equity investments include all direct private equity, direct infrastructure and direct real estate investments (including direct secondary transactions where Partners Group has a controlling interest). USD 1.4 billion invested in secondaries and USD 1.5 billion invested in primaries in 2020. Abbreviation: RoW = Rest of World. Source: Partners Group (2021). INVESTMENTS 28
Our transformational investing approach results in consistent and sustainable outcomes
Thematic sourcing Above-average growth, resilient sub-sectors supported Direct private equity portfolio by transformative trends EBITDA growth
1 +10%
Platform building strategy 2 Acquiring add-on targets at attractive valuations to grow market share & build resilience 2020 EBITDA 3 2019 EBITDA Asset transformation Enhancing business models & operational performance to Total full-year adjusted EBITDA of Partners increase cash flows & margins Group's private equity direct portfolio
For illustrative purposes only. Source: Partners Group (2021). INVESTMENTS 29
Partners Group's unique governance framework is the key driver of success
Our board members are engaged, aligned, and accountable
Our boards Board work is Board members Our boards are ✓We own the board ✓ ✓decisions are ✓evaluated ✓face annual re- close to our assets transparent to PG annually election
• Oversight of board performance Lead Operating Directors (LODs) • Build strong • Vision Strategy Risk & Audit implementation • Strategy committee committee team • Accountability Board Nomination Compensation Management committee committee
Operating Directors
• Significant industry expertise • Internal challenger & goal checker • Relevant professional network
Our entrepreneurial governance framework focuses on active ownership and hands-on value creation
For illustrative purposes only. Source: Partners Group (Jan 2019) INVESTMENTS 30
Overall strong portfolio outperformed public market benchmarks
Net direct portfolio performance overview
Full-year 2020 2016-2020 Reference index Outperformance Partners Group1 return2 p.a.1,3
Private equity 17.6% 15.9% +6.7%
Private debt 2.0% 3.5% +0.3%
Private real estate -3.3% -8.2% +1.5%
Private infrastructure 14.4% -5.8% +8.1%
1 Partners Group shows performance as model net returns, which are based on gross investment performance and standard fee parameters for the twelve-month period ended on 31 December 2020 and for the 5-year period ended on 31 December 2020, respectively. All cash flows and valuations are converted to USD using fixed FX rates as of 31 December 2020. Return figures denote annualized pooled internal rates of returns (IRR). Model net figures do not include the impact of factors such as any taxes incurred by investors, organizational and administration expenses or ongoing operating expenses incurred by the investment program (e.g. audit, hedging etc.). The performance presented reflects model performance an investor may have obtained had they invested in the manner and the time period shown and does not represent performance that any investor actually attained. 2 For reference purposes, Partners Group private equity, private debt, private real estate and private infrastructure performances are compared, respectively, to the following USD-denominated indices: MSCI World Net Total Return USD Index (ticker: NDDUWI); a composite of 50% S&P/LSTA Leveraged Loan Index in USD (ticker: SPBDAL) and 50% S&P European Leveraged Loan Index USD-hedged (ticker: SPBDELUH); FTSE EPRA NAREIT Developed Total Return Index USD (ticker: RUGL); and S&P Global Infrastructure Total Return Index USD (ticker: SPGTINTR). Reference index returns denote time-weighted returns. 3 Outperformance over the 5-year period ended on 31 December 2020 is measured relative to the 5-year public market equivalent return according to Long & Nickels for the respective reference index. INVESTMENTS 31 Preqin places our private equity performance among the most consistent top- performing global buyout managers since the Global Financial Crisis
Average Quartile Ranking of post-GFC Buyout Vintages1
1st quartile
2nd quartile
3rd quartile
4th quartile
Manager 1 Manager 3 Manager 4 Manager 5 Manager 6 Manager 7 Manager 8 Manager 9 Manager
Manager 10 Manager 11 Manager 12 Manager 13 Manager 14 Manager 15 Manager 16 Manager 17 Manager 18 Manager 19 Manager 20 Manager 21 Manager 22 Manager 23 Manager 24 Manager 25 Manager
Partners Group Partners Partners Group Partners
Past performance is not indicative of future results. There is no assurance that similar results will be achieved. For illustrative purposes only. Abbreviation: GFC = Global Financial Crisis. 1 Source: Preqin (December 2020), Post-GFC Track Records Could Drive 2021 Allocations. Partners Group (2021). UPDATE ON PARTNERS GROUP 32
Table of contents
1 Overview
2 Clients
3 Industry
4 Investments
5 ESG
6 Financials ESG 33
Our experience as a responsible investor allows us to be an ESG thought leader
Through PG LIFE2, we take We are developing our climate Since 2006, PG has been a All investments comply with PG's responsible investment one strategy, committing to the committed leader in Responsible Investment step further Task-Force on Financial responsible investing, framework with by investing in companies Disclosure and to offset our and one of the first private strict ESG standards1, and assets that meet our corporate footprint and market investors to sign the earning "A+" ratings in the last financial criteria and exploring Principles for Responsible six years from the UN PRI's actively contribute to alignment with the Paris Investments (UN PRI) annual ESG assessment achieving the UN SDGs Agreement3
2006 2008 2015 2018 2019/2020
We stay ahead of best practice by actively engaging in the global responsible investment community
1 Propriety ESG due diligence tool based on the Sustainability Accounting Standards Board metrics integrated in the investment decision process for all our Direct investments, ESG integration programs defined for all our lead investments. 2 PG Life is an investment strategy launched in 2018 that has the dual mandate to achieve attractive risk-adjusted financial returns alongside measureable, positive social and environmental impact. 3 Climate goals apply to client accounts to the extent consistent with applicable fiduciary duties or responsibilities. Source: Partners Group (2021). ESG 34
Clear oversight of sustainability topics at Board and Executive Committee level
Partners Group's sustainability governance structure
Grace del Rosario-Castaño André Frei Independent Board Member Co-CEO
Board of Directors Executive Committee
Investment Oversight Committee Investments Clients
ESG & Sustainability team Services Corporate Embedded within Industry Value Creation team
For illustrative purposes only. Source: Partners Group (2020). ESG 35
Partners Group's approach to ESG integration: key engagement points
Sourcing Due diligence Holding Reporting
• ESG investment • ESG Due Diligence • On-board management to • Highlight ESG project themes proposed Assessment completed to our responsible investment impact in seller materials based on identified identify and mitigate approach through case studies ESG trends material ESG risks • Implement priority ESG • Identify and meet ESG- • Negative screening of • Pre-position ESG projects projects related market illegal and harmful to ensure upfront alignment • Monitor ESG performance requirements (i.e. IPO products/services and buy-in from through annual ESG KPI & sustainability standards) management project reporting process
Screening Framework ESG Due Diligence Tool ESG Engagement1 ESG Project Case Study1
Partners Group integrates ESG considerations throughout the entire investment process
For illustrative purposes only. Source: Partners Group (2020). 1 These transactions represents standard transactions in which Partners Group has engaged in an ESG value creation project. They have been selected to discuss the ESG integration process in detail. Partners Group can share details of specific transactions upon request. ESG 36
Partners Group's proprietary ESG Dashboards: an innovative view of the portfolio
Tracking and reporting on key environmental, social and governance KPIs:
Environmental management Climate change Energy management Waste management E Environmental GHG intensity Energy intensity % of waste Environmental policy maturity1 (tCO2e/ m USD sales) (kWh/ USD sales) diverted per year
Sustainable supply chains Employee retention Health & safety Gender equality advancement S Responsible supply % of yearly Lost-time % of women in Social chain policy maturity1 employee turnover incident rate2 management team
Corporate governance Active ownership Bribery & corruption Cybersecurity Board maturity based # of Operating Anti-bribery & G Cybersecurity on board health Directors on corruption policy Governance policy maturity1 assessment1 company Board maturity1
1 For metrics that are qualitative, rather than quantitative, we conduct maturity assessments, scoring each asset from 1-4 across five key dimensions (policy, authorization, responsibility, implementation and reporting), with 1 indicating a low level of maturity and 4 indicating best practice. 2 Yearly number of workplace incidents that kept employees from coming to work for at least one day. For illustrative purposes only. Source: Partners Group (2020). ESG 37
As a responsible owner, we positively impact stakeholders in our portfolio
Satisfaction & engagement Personal growth & development Financial access • Engagement surveys • Leadership training • Employee hardship fund • Annual employee awards • Development training • Employee participation plans • New / updated facilities • Career planning • Tuition reimbursement
Select stakeholder impact projects Diversity & inclusion Health & wellness Family support across our • Building female leadership • Free/affordable exercise • On-site day care portfolio • Coaching for differently-abled • Affordable healthcare • Discounted education employees • Health & Safety • Corporate care partnerships • Hiring & training for refugees
For illustrative purposes only. Source: Partners Group (2020). ESG 38
ESG initiatives enhance operational results
Energy Management Driver Safety Program Community Investment Employee Satisfaction Food Waste Reduction
Relieving local facility Detailed visibility of First community Empowered HR functions Deployment of directors from manual driving habits and investment project of its to nurture employees and easy-to-use food wastage energy management performance of drivers kind in Australia create a great workplace monitoring system at (heating, ventilation, air environment operated locations conditioning, lighting)
To be applied to Tracking & analysing ~100 local residents System has been Turnover rate quickly ~1,050 learning driving behaviour of decided to invest deployed at ~90% of dropped by half centers by 2020 ~8,500 trucks with us locations
reduction in reduction in number of Glassdoor Food waste 12% energy 20% responsible 94 investors from 4.1 review 10% reduction consumption accidents community (from 1.5)
For illustrative purposes only. There is no assurance that similar investments will be made in the future. Source: Partners Group (September 2019) ESG 39
We are consistently recognized for our ESG, impact and sustainability initiatives
"Partners Group has "Sapphire Wind Farm "PG LIFE has "PG LIFE has one of the "PG LIFE has helped effectively integrated has engaged directly translated the high- most thoughtful & define minimum these standards into a with over 10,000 level SDGs into an innovative applications standards to be an tool that investment members of the investable private of the IMP framework" 'impact investor'" professionals can use" community" markets strategy" October 2016 January 2018 September 2018 January 2019 April 2019
We translate responsible investment concepts into practical and implementable tools
For illustrative purposes only. Abbreviations: IMP = Impact Management Project, SDGs= Sustainable Development Goals. Source: Partners Group (2020). ESG 40
Partners Group retains high scores from UN PRI for Responsible Investment
Partners Group's 2020 UN PRI report for Responsible Investment Partners Group Median score score Strategy & Governance A+ A Direct private equity A+ A
Direct lending A B
Direct private infrastructure A+ A
Direct private real estate A B
Results highlight strong ESG program and leadership in Responsible Investment
Abbreviations: PRI: Principles for Responsible Investment. Source: UN PRI (2020), Partners Group (2020). UPDATE ON PARTNERS GROUP 41
Table of contents
1 Overview
2 Clients
3 Industry
4 Investments
5 ESG
6 Financials FINANCIALS 42
Strong client demand and performance translated into robust 2020 financials
AuM Mgmt. fees2 Revenues3 EBIT margin Dividend4 (in USD billion) (in CHF million) (in CHF million) (in %) (in CHF per share)
+16% +1% -12% stable +8% 109 1’610 1’412 94 1’138 1’146 29% perf. fees 19% +6% 62.6% +4% 62.0% 25.50 27.50 in CHF1 rec. mgmt. fees
2019 2020 2019 2020 2019 2020 2019 2020 2019 2020
Continued Sustained Strong recovery Focus on 91% strong client growth in line of performance profitable payout demand with AuM fees in H2 growth ratio
1 The +6% growth in the chart refers to average assets under management in CHF, calculated on a daily basis. 2 Management fees and other revenues, net, and other operating income. 3 Revenues from management services, net, and other operating income. 4 The Board of Directors proposes that a dividend of CHF 27.50 per share be paid for the financial year 2020, subject to the approval of the Annual General Meeting of shareholders to be held on 12 May 2021; the dividend payout ratio is defined as the (proposed) dividend per share divided by diluted earnings per share. Source: Partners Group (2021). FINANCIALS 43
Management fees growth follows AuM development
Revenues1 (in CHF million)
1'610 +21% -12% 1'412 Revenues1 1'326 69 473 (29%) 266 Performance fees 324 (19%) (24%) 61 Other revenues & other 94 operating income 84 1'138 1'146 (71%) (81%) Management fees2 1'002 (76%)
2018 2019 2020
1 Revenues from management services, net, and other operating income. 2 Management fees and other revenues, net, and other operating income. Source: Partners Group (2021). FINANCIALS 44
Performance fees normalized in H2; outlook on performance fees reconfirmed
Outlook on performance fees
H1: 9% ~10% 1 H2: 27% 20-30% Performance fees
19% Management fees2 70-80% “contractually recurring” 81% ~90%
2006-2015 2020 long term
1 Assuming that the market is favorable to exits, Partners Group expects to continue to generate significant performance fees from the underlying client portfolios due to the visibility that it has on the life cycles of its programs. 2 Management fees and other revenues, net, and other operating income. Source: Partners Group (2021). FINANCIALS 45
Performance fees are well diversified across programs and assets
Contribution by investment programs & mandates Contribution by single assets
Top 1 Rest (>50) 7% Top 2 13% Top 1 4% Top 3 29% 3% Top 4 Dozens of Top 11-20 3% direct assets 14% CHF CHF Top 5 and hundreds of 266m 266m 3% portfolio assets 80% Top 6-10 15% Top 2-5 29%
Our investment programs are highly diversified through our portfolio management approach
Source: Partners Group (2021). FINANCIALS 46
Performance fee potential will grow in line with AuM over time
AuM and performance fee development
109 800 ~20-30% AuM (in USD billion) 94 of total 100 700 Performance fees (in CHF million) revenues 83 600 74 80 500 473 …translates 57 60 400 Past AuM… 50 372 into future 45 324 performance 43 294 300 37 266 fee potential40 31 28 200 22 24 18 20 100 11 H1 H164 H1 6 43 39 34 H1 16 13 H1 H1 0 0 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2025
Note: assuming that the market is favorable to exits, Partners Group expects to continue to generate significant performance fees from the underlying client portfolios due to the visibility that it has on the life cycles of its programs. Source: Partners Group (2021). FINANCIALS 47
Performance fee recognition models
Cash-on-cash Deal-by-deal (incl. NAV gains/losses)
Capital returned to clients Capital returned to clients If NAV were sold at… If NAV were sold at… total current value total current value 200 200 (in USD) …+50% = 90 = 18 (in USD) …+50% = 30 = 6 NAV NAV …+0% = 60 = 12 …+0% = 0 = 0 60 60 hurdle rate …-50% = 30 = 6 …-50% =-30= -6 140 (8% IRR on invested capital) so far recognized 8 catch-up 20 initial client commitment initial client commitment performance fees 100 100 (in USD) Distributions (in USD) 140 Performance fees Distributions (20% above 100) 140 Locked-in performance (based on exits) 6-9 years 6-9 years Performance fee recognition Performance fee recognition (realized) 8 (realized & unrealized)
0 20 20 0 (NAV +0%) (NAV +0%)
1 Performance fees of performance fee generating investment programs and mandates range between typically 10-20% over a hurdle of typically 6-8% IRR on invested capital, depending on program and instruments. Source: Partners Group. For illustrative purposes only. FINANCIALS 48
Continued stability of management fees
Revenue margin1
1.89% 1.82% 1.74% 1.71% 1.51% 1.35% 1.36% 1.36% 1.39% 1.39% 1.38% 1.26% 1.33% 1.25% 1.23% 19% 1.30% 1.31% 1.33% 1.29% 1.25% 1.24% 1.26% 1.26% 1.24% 1.29% 1.23% 1.18% 1.23% 1.22% 1.22%
81%
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Performance fees Management fees2
1 Calculated as revenues divided by average assets under management, calculated on a daily basis. 2 Management fees and other revenues, net, and other operating income. Source: Partners Group (2021). FINANCIALS 49
Stable EBIT margin; operating costs developed in line with revenues
Revenues, costs and EBIT development (in CHF million)
2019 2020
Revenues 1'610 -12% 1'412
Total operating costs, of which -603 -11% -537
Personnel expenses -490 -12% -430 Personnel expenses (regular) -306 +8% -329 Personnel expenses (performance fee-related) -185 -45% -101 Other operating expenses -79 -13% -69 Depreciation & amortization -34 +12% -38
EBIT 1'008 -13% 875 EBIT margin 62.6% 62.0%
Average FTEs 1'337 +12% 1'504 Year-end FTEs 1'452 +5% 1'519
Note: revenues include management fees and other revenues, net, performance fees, net, and other operating income. Regular personnel expenses exclude performance fee-related expenses. Performance-fee-related personnel expenses are calculated on an up to 40% operating cost-income ratio on revenues stemming from performance fees. Source: Partners Group (2021). FINANCIALS 50
Continued EBIT margin stability; target EBIT margin reconfirmed
EBIT1 margin development
80%
70% 65% 65% 61% 63% 62% 60% 59% 59% 58% 60% ~60% 50% 1.06 40% target for newly 30% generated management fees and all 20% performance fees 10%
0% 2012 2013 2014 2015 2016 2017 2018 2019 2020
1 For the years 2012 – 2014, non-cash items related to the capital-protected product Pearl Holding Limited were excluded from depreciation & amortization. Source: Partners Group (2021). FINANCIALS 51
Increasingly diversified FX exposure on costs expected
Currency exposure in 2020
Others 6% GBP 9% Others EUR EUR SGD 6% 5% 11% 47% USD 27% AuM ≈ GBP Management 12% Costs2 fees1 ≠ USD 38% CHF 40%
EUR/USD foreign exchange fluctuations have a greater impact on CHF management fees than on CHF costs, while their impact on performance fees and their corresponding costs is equal
Note: all figures are based on estimates and the currency denomination of underlying programs. Due to rounding, some totals may not correspond with the sum of the separate figures. 1 Includes management fees and other revenues, net, and other operating income. 2 Includes regular personnel expenses (excluding performance fee-related expenses), other operating expenses as well as depreciation and amortization. Source: Partners Group (2021). FINANCIALS 52
Strong balance sheet and liquidity
Key financials (in CHF million, except for per share data in CHF) Balance sheet (as of 31 December 2020)
2019 2020 Revenues1, of which 1'610 -12% 1'412 Management fees2 1'138 +1% 1'146 Performance fees 473 -44% 266 1.1 35% CHF billion return on 3 Total operating costs -603 -11% -537 net cash4 equity
EBIT 1'008 -13% 875 EBIT margin 62.6% -0.6%-points 62.0%
Financial result 30 53 Income tax expenses -137 -124 0.7 2.3 CHF billion CHF billion Profit 900 -11% 805 in own investments5 equity Diluted EPS 33.66 30.36
1 Revenues include management fees and other revenues, net, performance fees, net, and other operating income. 2 Management fees and other revenues, net, and other operating income. 3 Total operating costs include personnel expenses, other operating costs as well as depreciation and amortization. 4 Cash and cash equivalents (CHF 1'228 million) and short-term loans (CHF 673 million), net of debt (CHF 799 million) as of 31 December 2020. 5 Financial investments (CHF 616 million), investments in associates (CHF 25 million) and net assets/liabilities held for sale (CHF 51 million) as of 31 December 2020. Abbreviations: EPS = earnings per share. Source: Partners Group (2021). FINANCIALS 53
Proposed dividend increase of 8% to CHF 27.50 per share (payout ratio of 91%)
Dividend payment since IPO
USD 109 billion
1 30.00 Total AuM (in USD billion) 27.50 120 Dividend/share (in CHF) 25.50 25.00 22.00 100 19.00 20.00 80 15.00 15.00 60 10.50 10.00 8.50 40 USD 11 billion 7.25 5.50 6.25 4.25 4.25 4.50 5.00 5.00 2.65 20
0.00 0 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Note: assets under management exclude discontinued public alternative investment activities and divested affiliated companies. 1 The Board of Directors proposes that a dividend of CHF 27.50 per share be paid for the financial year 2020, subject to the approval of the Annual General Meeting of shareholders to be held on 12 May 2021. The payout ratio is calculated as dividend per share divided by diluted earnings per share. Source: Partners Group (2021). 54
Contacts
Zugerstrasse 57 Philip Sauer 6341 Baar-Zug Head Corporate Development Switzerland T +41 41 784 66 60 T +41 41 784 60 00 Email: [email protected] [email protected] Dr. Alex Soppera www.partnersgroup.com Corporate Development T +41 41 784 63 20 Email: [email protected]
ZUG|DENVER|HOUSTON|TORONTO| NEW YORK|SÃO PAULO|LONDON|GUERNSEY|PARIS|LUXEMBOURG|MILAN|MUNICH|DUBAI|MUMBAI|SINGAPORE|MANILA|SHANGHAI|SEOUL|TOKYO|SYDNEY IMPORTANT NOTICE 55
Disclaimer
NEITHER THE INFORMATION IN THIS DOCUMENT NOR ANY RELATED MATERIALS MAY BE TAKEN OR TRANSMITTED INTO THE UNITED STATES OR DISTRIBUTED OR REDISTRIBUTED, DIRECTLY OR INDIRECTLY, IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN. This presentation is strictly confidential to the recipient and has been prepared by Partners Group Holding AG (the "Company") solely for information purposes and use at the presentation to the respective recipient ("Presentation"). All sources, which have not been otherwise credited, have been derived from Partners Group. The information contained herein consists of slides solely for use at the Presentation. By attending such Presentation, you agree to be bound by the following terms. This Presentation may not be reproduced, retransmitted or further distributed to the press or any other person or published, in whole or in part, for any purpose. Failure to comply with this restriction may constitute a violation of applicable securities laws. This Presentation does not constitute or form part of and should not be construed as, an offer to sell or issue or the solicitation of an offer to buy or acquire securities of the Company in any jurisdiction or an inducement to enter into investment activity. No part of this Presentation, nor the fact of its distribution, should form the basis of, or be relied on in connection with, any contract or commitment or investment decision whatsoever. This Presentation does not constitute a prospectus or a similar communication within the meaning of article 752, 652a and/or 1156 of the Swiss Code of Obligations ("CO") or a listing prospectus within the meaning of the listing rules of the SIX Swiss Exchange. Neither the Presentation nor any copy of it may be taken or transmitted into the United States of America, its territories or possessions, or distributed, directly or indirectly, in the United States of America, its territories or possessions. Any failure to comply with this restriction may constitute a violation of U.S. securities laws. The Presentation is not an offer of securities for sale in the United States. The Company's securities may not be offered or sold in the United States except pursuant to an exemption from, or transaction not subject to, the registration requirements of the Securities Act. Additional restrictions may apply according to applicable securities laws of other jurisdictions, including, without limitation, the European Union, Canada, Australia and Japan. The information contained in this Presentation has not been independently verified. The Company is not under any obligation to update or keep current the information contained herein. Accordingly, no representation or warranty or undertaking, express or implied, is given by or on behalf of the Company or any of their respective members, directors, officers, agents or employees or any other person as to, and no reliance should be placed on, the accuracy, completeness or fairness of the information or opinions contained herein. Nothing herein shall be relied upon as a promise or representation as to past or future performance. Neither the Company nor any of their respective members, directors, officers or employees nor any other person accepts any liability whatsoever for any loss howsoever arising from any use of this Presentation or its contents or otherwise arising in connection with the Presentation. This Presentation includes forward-looking statements, beliefs or opinions, including statements with respect to plans, objectives, goals, strategies, estimated market sizes and opportunities which are based on current beliefs, expectations and projections about future events. The words "believe," "expect," "anticipate," "intends," "estimate," "forecast," "project," "will," "may," "should" and similar expressions identify forward-looking statements. The forward-looking statements in this Presentation are based upon various assumptions, many of which are based, in turn, upon further assumptions, including, without limitation, management’s examination of data available from third parties. Although the Company believes that these assumptions were reasonable when made, these assumptions are inherently subject to significant uncertainties and contingencies which are difficult or impossible to predict and are beyond its control, and the Company may not achieve or accomplish these expectations, beliefs or projections. Neither the Company nor any of its members, directors, officers, agents, employees or advisers intend or have any duty or obligation to supplement, amend, update or revise any of the forward-looking statements contained in this Presentation. The information and opinions contained herein are provided as at the date of the Presentation and are subject to change without notice.
17 March 2021 09:19