Management Report
- The year in review -
In 2024, the global economy remained stable, however, performance varied significantly across countries. The United States experienced robust economic expansion driven by strong consumption. Growth in the euro area was slower (compared to the US) although consumption improved as real incomes recovered. Central banks are expected to keep lowering monetary policy rates, but the pace will vary, leading to different growth and inflation outlooks.1
According to the International Monetary Fund (IMF), global growth is projected to stay at 3.3% in both 2025 and 2026, below the historical average of 3.7% (2000-2019). Global headline inflation is expected to decrease to 4.2% in 2025 and 3.5% in 2026, with advanced economies reaching their targets sooner than emerging markets and developing economies. These forecasts assume that energy commodity prices will decline in 2025, while non-fuel commodity prices will rise.
The below overview reflects our understanding of macro-economic growth projections based on, amongst other things, the IMF report of January 2025:
- Euro area: growth is expected to gradually pick up, despite geopolitical tensions affecting the outlook. The IMF forecasts growth at modest rates: 1.0% for 2025 and 1.4% in 2026. Recent political shifts in Germany (and, more generally, in the Euro zone) could imply more defence and infrastructure spending and hence have a positive impact on growth.
- United States: growth is projected to be 2.7% in 2025, driven by strong underlying demand, wealth effects, a less restrictive monetary policy stance, and supportive financial conditions.
- China: growth is forecasted at 4.6% in 2025 and 4.5% in 2026, with a 0.1 percentage point upward revision for 2025. This revision reflects carryover from 2024 and the fiscal package announced in November, which largely offsets the negative impact of trade policy uncertainty and issues in the property market.
The results of Cobepa and its portfolio companies should be assessed in this complex economic environment.
Throughout the past ten years, Cobepa measured the performance of the past financial year via two indicators.
The first indicator is the current net consolidated result which is obtained by deducting from the net result any non-recurrent items as well as the capital gains and losses.
The current net consolidated result amounts to EUR 58.57 million for 2024 (EUR 57.92 million after the allocation of EUR 0.65 million as profit premium) - compared to EUR 70.59 million in 2023, i.e. a decrease of 17.0%.
The current net consolidated result is derived from the dividends and interest income less the operating charges. The decrease of the result in 2024 is mainly explained by a positive FX result realised in 2023 of EUR 12.9 million. Dividends received from portfolio companies amount to EUR 43.43 million and interests revenue amount to EUR 17.93 million. Compared to 2023, dividends received from portfolio companies and interest revenue are stable, which can be considered as a good performance taken into account the absence of dividends from Degroof Petercam following the sale of that asset.
This current net consolidated result constitutes the first revenue source to ensure the payment of the dividend. The second source comes from the capital gains and net impairments which amount to EUR 52.75 million in 2024.
In total, the consolidated net income of Cobepa amounts to EUR 100.70 million for 2024 (EUR 100.05 million after the allocation of EUR 0.65 million as profit premium), compared to EUR 20.64 million in 2023.
Following the transactions realised in 2024 and after payment of the dividend, the net treasury position Cobepa decreased from EUR 857.83 million at the beginning of the financial year to EUR 475.70 million on 31 December 2024.
The second key indicator used by Cobepa for measuring the performance realised over the past financial year is the evolution of the Net Asset Value (NAV) increased by the dividend paid. The NAV is not audited but is evaluated according to a constant and prudent methodology which is validated by the Audit Committee.
On 31 December 2024, the NAV amounts to EUR 5,115.0 million, i.e. an increase of 10.1% year-on-year, including dividend. This percentage reflects the overall return realised by our portfolio and by the important treasury in 2024. Although lower than our long-term objectives, this growth nevertheless reflects a good performance of our investment portfolio, which is outperforming the investment portfolios of many of our peers in a market which has been particularly challenging for private equity.
As per 31 December 2024, the financial fixed assets in the consolidated accounts amount to EUR 2,905.7 million, compared to EUR 2,479.5 million as per 31 December 2023. This evolution results from the investments and divestments completed in 2024 as well as from the write- downs and write-backs enacted in 2024.
As a reminder, Cobepa SA’s accounts are drawn up in Belgian GAAP, which means that the accounts do not reflect the underlying market value of the portfolio companies of Cobepa SA, except in those cases where the market value is deemed to be, on a permanent basis, equal to or lower than the initial acquisition price.
Transactions during the year
The investment team of Cobepa analysed rigorously a large number of investment files based on the principles detailed below in the Investment Philosophy and Risks sections. This team consisted of 31 persons at the end of 2024, among which the Chief Executive Officer.
Investments
Cobepa invested EUR 162.6 million to acquire a majority stake in the Smart SD group, an online B2B distributor of security and fire safety solutions, in March 2024. Smart SD’s portfolio includes a wide range of security and fire products such as video surveillance, intrusion detection, access control and fire detection from nearly 100 premium brands.
In April 2024, Cobepa participated in Socotec’s capital increase for an amount of EUR 16.1 million. In addition, Cobepa contributed an amount of USD 7.8 million to the capital of BioAgilytix and has made available a subordinated loan in the amount of EUR 22.5 million to HG International.
In the second half of 2024, Cobepa invested EUR 146.3 million to acquire joint control over Easyfairs, together with Inflexion and the company’s founder. Easyfairs is one of the largest pan-European event and trade fair organizers, active on both B2B and B2C sides.
NAV as of 31 December 2024 vs. NAV as of 31 December 2023
In € m
Cobepa contributed an amount of EUR 6.7 million to the capital of Corsearch in the context of a capital increase completed to finance an acquisition (Navee) which took place in October 2024.
Cobepa ended December 2024 by investing EUR 190.1 million to acquire a majority stake in Ascentiel Groupe. The company is active as a digital insurance brokerage platform specializing in property & casualty, insurance for individuals and small businesses across various specialty niches.
Divestments
In June 2024, Cobepa completed the sale of its stake in Banque Degroof Petercam to Indosuez Wealth Management Group (Credit Agricole Group) for an amount of approximately EUR 191.4 million.
Cobepa has also entered into a put option agreement in December 2024 with a consortium consisting of ICG fund, Krefeld, CNP and Sagard, in relation to the sale of its majority stake in Climater. A share purchase agreement has been signed in January 2025 and closing of the transaction has taken place on 20 March 2025.
Fees paid to the Statutory Auditor
The fees paid to the Auditor for his audit work at Cobepa SA amount to EUR 13,215 (excluding VAT).
No fees were paid by the Cobepa Group to the Auditor or to affiliated offices of the Auditor outside Belgium for audit work of consolidated subsidiaries (excluding VAT).
Moreover, the Cobepa Group paid fees in an amount of EUR 321,213 (excluding VAT) to affiliated offices of the Auditor for fiscal assistance assignments.
Finally, fees related to other missions outside the audit mission performed by the Auditor and by companies with which the Auditor is related amount to EUR 746,430 (excluding VAT and disbursements) for Cobepa.
Investment philosophy
Since its inception in 1957, Cobepa constitutes for its shareholders an evergreen vehicle through which they diversify their assets by having access to long-term investments.
The investment philosophy of Cobepa is built on a partnership culture in which the interests of managers, shareholders and stakeholders, including environmental considerations, are taken into account.
In 2022, Cobepa reaffirmed this philosophy by defining its “Purpose” as follows: “Partnering to build responsible prosperity for the long term”.
Thus, this philosophy consists in accompanying companies, either as a majority shareholder or through a significant minority, with a twofold objective:
- to become a stable shareholder of these companies in order to allow them to put in place the conditions necessary to achieve responsible and sustainable growth; and
- to participate in the determination of their business strategy through active participation in the various decision-making bodies (excluding the bodies in charge of the daily management).
Through these objectives, Cobepa aims to contribute to the development of its portfolio companies.
The economic model of Cobepa consists in generating a flow of stable, growing dividends towards the shareholders of Cobehold SA and to re-invest most of the capital gains realised on disposals when Cobepa believes it has fulfilled its role and objectives as a shareholder.
Risks
The company bears no particular risks other than those that are related to the daily management of the company. The evolution of those risks is communicated twice a year to the Audit Committee.
The company is bearing the risks to which Cobepa is exposed.
The risks to which Cobepa is exposed reflect, to a large extent, the risks to which the companies in which Cobepa has an interest are exposed.
The rigorous analysis of each investment and the diversification of the portfolio to which Cobepa is mindful are likely to mitigate these risks.
On 31 December 2024, Cobepa's portfolio consists of 21 investments. This portfolio is diversified between several sectors. The vast majority of the portfolio companies hold leading positions in their respective markets.
Following an in-depth analysis of a potential investment, Cobepa decides to proceed with the investment after analysing the following elements:
- the existence of favourable market dynamics, including a deep and growing market(s), addressable adjacent markets and a favourable industry structure (resilient and/or recession-proof markets, capacity to pass through price increases, no major threat of substitution, adoption rate for the products/services is increasing / structural for the foreseeable future);
- the presence of sustainable competitive leadership, with sizeable and growing market shares, higher margins than the competition, high barriers to entry, technological edges, high customer satisfaction, a compelling ESG policy and approach, a clear business purpose, efficient talents management and a presence at the center of an ecosystem (stable or growing position in the overall value chain);
- a strong management and governance, with an adequately seasoned and calibrated management team, being deeply financially committed, the ability to hire and fire top management, and adequate governance ensuring;
- attractive economics: high cash conversion capacity (including M&A investments if included in returns), structural operating leverage, attractive deleveraging profile, ability to pay dividends/interest/fees after some years and a fast de-risking profile in terms of EBITDA multiple; and
- the existence of multiple and enforceable levers for accelerated growth and a multi-path exit strategy, including possible and credible acceleration of value creation, an equity story supported by multiple drivers that can be activated by the company itself and are not dependent on external factors over which the company has no control, and the presence of true strategic value leading to no dependency on one exit route and offering downside protection.
The vast majority of the realised investments meets these characteristics.
Furthermore, Cobepa always ensures that its investments are adequately protected:
- Cobepa ensures that a clear joint project, which will create value and comply with all stakeholders’ interests, is outlined and accepted;
- Cobepa recognizes the necessity for management to have a strategic view which is in the interest of all stakeholders. Accordingly, Cobepa invests in companies whose existing management is solid and encourages the implementation of long-term incentive schemes for the top executives, thereby ensuring a partnership that is beneficial for all stakeholders;
- Cobepa systematically requests a seat on the board of directors of companies in which it invests. Furthermore, it defines certain subjects as being “key matters” for which it reserves the right to influence decisions, in order to protect its investment, especially when the Cobepa Group is a minority shareholder;
- Cobepa always ensures that a thorough and complete due diligence has been performed before investing; the Cobepa Group requires regular reporting from the companies in which it invests;
- Cobepa concludes shareholders’ agreements which provide for specific liquidity clauses; and
- Cobepa requires an annual yield for growth capital investments.
In addition, investments are continuously monitored through:
- the exercise of one or more board positions in most of the portfolio companies;
- the participation of the director designated by Cobepa in the audit committee and remuneration committee in most portfolio companies; and
- the internal analysis carried out by the team dedicated to monitoring each portfolio company.
This monitoring should allow for any issues to be detected at an early stage and for the appropriate measures to be taken rapidly.
ESG
In 2024, Cobepa continued implementing its ESG approach and refining its processes, training and tools to analyze ESG considerations in future and current investments. With the help of a ESG advisor, this strategy is applied in the pre-investment phase and during the ownership phase of the portfolio company (see below).
Furthermore, in 2024, Cobepa issued an ESG Report to its shareholders, outlining Cobepa’s ESG approach and how it engages with its portfolio companies on ESG.
ESG in the pre-investment phase
This approach focuses on the evaluation of potential new investments according to their ESG practices. This strategy is based on the due diligence tool, developed in-house, which is designed to assess potential acquisitions on their ESG approach and how they integrate ESG into their business model. The findings of this tool are incorporated into investment memoranda, which are analyzed and discussed by the Investment Committee.
ESG in the ownership phase
This phase focuses on the management of ESG risks and opportunities in the portfolio companies. Cobepa has developed a reporting tool that has been submitted to the portfolio companies in order to collect data and information on their ESG strategy, policies and ambitions, as well as on their key performance indicators. The information collected provides a useful assessment of the key priorities and issues within the portfolio companies, which will help Cobepa to support them in the implementation of their ESG ambitions, where appropriate.
Personnel
On 31 December 2024, Cobepa employed 43 persons.
Profit appropriation
Profit available for distribution:
Profit carried forward on 31 December 2023
2,231,808,500.75 EUR
Profit of the year to be appropriated
19,204,596.08 EUR
= Amount available for appropriation
2,251,013,096.83 EUR
The above data are derived from Cobepa SA’s statutory accounts.
Proposed dividend (EUR)
Profit appropriation (EUR)
Proposed dividend
The Board of Directors proposes to the Annual Shareholders’ Meeting to distribute a gross dividend of EUR 88,208,799.26, i.e. a gross dividend of EUR 3.25 per share.
Payment
The dividend will be paid in cash on 14 May 2025.
Post-closing events
On 28 January 2025, Cobepa signed a share purchase agreement for the sale of its majority stake in Climater. The approval of the European Commission and French Minister of Economy have been received in February 2025 and closing of the transaction has taken place on 20 March 2025.
There have been no other significant events since the closing of the accounts that might significantly affect the balance sheet and the income statement at 31 December 2024. There are no circumstances known to the management that could significantly impact the company’s development.
Other
The company has not undertaken any research and development activity.
The Directors indicate that no decision has been taken and no transaction has been decided upon that would fall within the scope of article 7:96 of the Companies and Associations’ Code.
The company does not have any branches.
The company uses derivative financial instruments to hedge the dollar risk.
During the financial year, the company did not acquire any rights or assume any obligations that materially affected the company's business, results and financial position.
1 World economic outlook update, January 2025, International Monetary Fund.
Comments on the accounts
For the accounting period ending on 31 December 2024, Cobepa SA drew up statutory accounts and restricted consolidated accounts. The accounts cover a period of twelve months.
As the accounts of Cobepa SA are integrated in the accounts published by Cobehold SA, the Annual Shareholders’ Meeting exempted Cobepa SA from drawing up and publishing consolidated accounts for the financial year 2024.