Rothschild & Co: 2021 – Half-year financial report

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2. Commercial activities

2.1 World Council

Our global advisory business is focused on providing advice in the areas of strategic advisory and mergers and acquisitions, financing advice encompassing debt, restructuring and equity advice, as well as advising investors. where we advise our clients on engaging with shareholders on a variety of topics, including activism, sustainability and governance.

Revenue for the quarter ended in June 2021 amounted to 439 million euros, up 68% compared to the second quarter of 2020 (260 million euros) and 11% compared to the first quarter of 2021 ( 395 million euros).

Sales for the six-month period ended June 2021 reached a record level of 833 million euros, up 57% (H1 2020: € 529 million), reflecting very high activity levels across the business. For the last twelve months up to June 2021, we ranked 5e globally by financial advisory revenue2.

Profit before tax for the six-month period ended June 2021, excluding ongoing investments in the development of our M&A franchise in North America, was up 105% to € 168 million (H1 2020: 82 million euros) representing a pre-tax profit of 20.1% (H1 2020: 15.4%). Including the effect of continued investments in the recruitment of seniors in North America, pre-tax income amounted to 165 million euros (H1 2020: 75 million euros) with an operating margin of 19, 8% (H1 2020: 14.1%).

Our Mergers and Acquisitions revenue for the six-month period ended June 2021 amounted to € 573 million, up 49% (H1 2020: € 385 million), on the basis of an increase in the activity of transactions in volume and value within our main geographic and sectoral franchises, both for companies and financial sponsors. We ranked 3rd worldwide by number of transactions carried out in the first half of 20213. In Europe, we continue to advise on more M&A transactions than any of our competitors, a position we have held for over 15 years.3.

Financing advice revenue for the six-month period ended June 2021 amounted to € 260 million, up 80% (H1 2020: € 144 million), driven by demand from existing and new clients for advice in terms of restructuring, balance sheet and liquidity recovery, as well as financing of acquisitions, refinancing and ECM advice. We ranked 1st in Europe in number of restructuring operations carried out in the first half of 20213, and we have advised more European equity assignments than any other independent financial advisor during the same period4. Global Advisory advised clients on innovative financing transactions related to sustainability and maintained its leadership role in raising funds for renewable energy projects.

During the first half of 2021, we continued our ongoing strategic investment in North America with the recruitment of a new Managing Director within the North America Financial Sponsors Group. In addition, at the beginning of September, we welcomed a new Managing Director to our group of financial sponsors and announced the opening of a new office in Boston.

Global Advisory has advised the following clients on important selected assignments which completedin H1 2021:

  • Coca ColaEuropean partners on its recommended offer for Coca-Cola Amatil from public shareholders and The Coca-Cola Company (US $ 8.4 billion, UK, Australia and US)
  • Alstom as part of its acquisition of Bombardier Transport and its flagship investment in la Caisse (€ 7.5 billion,
    France and Canada)
  • Walmart on its sale of Asda to Issa Brothers and TDR Capital (£ 6.8 billion, US and UK)
  • Hertz on its restructuring under Chapter 11 (adviser to the ad hoc group of European investors – US $ 19.1 billion, United States and the Netherlands)
  • Vodafone on its IPO of Vantage Towers (around 2.3 billion euros, UK and Germany)
  1. Source: Company deposits
  2. Source: Réfinitiv
  3. Source: Dealogic

Rothschild & Co | Half-Year Financial Report 2021 – 5

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