1Q14 Earnings Conference Call: A Leader in Alternative Investments in Latin America

A Leader in Alternative Investments in Latin America
May 16
th
, 2014
1Q14 Earnings Conference Call
Earnings Release 1Q14 Conference Call GP Investments 1
GP Investments presents its results excluding non-controlling interests to reflect the participation of GP
Investments as a Limited Partner in the funds it manages and the fees received from the Private Equity,
Real Estate and Asset Management businesses, as a general partner and shareholder, respectively. They
are management figures and, therefore, not audited. The complete financial statements which include
minority interests and are reviewed by our independent auditors are presented in the 1Q14 earnings
release.

These financial statements are in US GAAP standards and are being released simultaneously in all
jurisdictions in which GP Investments has its securities traded. In compliance with the Brazilian Securities
and Exchange Commission (Comisso de Valores Mobilirios), the issuer releases financial statements in
IFRS standards which may differ from these financial statements, due to different grounds of such
accounting standard.
Disclaimer
Financial Highlights

Private Equity Portfolio

Portfolio Development

Direct Investments

Business Development
Agenda
Earnings Release 1Q14 Conference Call GP Investments
Revenues
Total revenues reached US$26.2 million in the 1Q14, due mainly to:

US$12.4 million in management fees, including intercompany fees, representing a 15% decrease in a year-over-
year comparison;
US$2.2 million in dividends received; and
US$11.7 million in appreciation of Fair Market Value of investments.
3
Revenues Breakdown (In US$ million) Management Fees (In US$ million )

12.4
-15%
1Q14

8.5
2.4
1.4
1Q13

14.6
10.8
3.8
BRZ Investimentos
GP Advisors
GP Investments
(in US$ million)
1Q13 1Q14
Fund Management
Management fees 14.6 12.4
Performance fees 0.2 0.0
Capital Results
Net realized gains 2.4 0.0
Dividends and other 0.0 2.2
Change in FMV 14.9 11.7
Total Revenues 32.1 26.2
Expenses
4
Total recurring expenses were US$13.7 million in 1Q14, according to the breakdown below:
US$8.6 million in operating expenses, representing a 9% decrease in a year-over-year comparison, mainly as a
result of lower G&A expenses;
US$0.6 million in bonus expenses;
US$3.6 million in intercompany management fees; and
US$0.9 million in non-cash stock option expenses.
Expenses Breakdown (In US$ million) Operating Expenses (In US$ million)

8.6
-9%
1Q14 1Q13
9.5
(in US$ million)
1Q13 1Q14
Operating expenses 9.5 8.6
G&A expenses 4.7 4.0
Payroll 4.8 4.7
Bonus expense 0.8 0.6
Carried interest 0.0 0.0
Intercompany management fees 3.5 3.6
Intercompany performance fees 0.1 0.0
Stock options 0.6 0.9
Total Expenses 14.5 13.7
Income Statement
5
GP Investments posted net income of US$1.6 million in 1Q14, benefitting mainly from the US$2.6 million gain
in Fund Management and the favorable unrealized change in the FMV of our portfolio.
INCOME STATEMENT 1Q13 1Q14
(In US$ million)
Fund
Management
Capital
Results
Total
Fund
Management
Capital
Results
Total
Management fees 14.6 - 14.6 12.4 - 12.4
Performance fees 0.2 - 0.2 0.0 - 0.0
Unrealized change in FMV - 14.9 14.9 - 11.7 11.7
Net realized gains / losses - 2.4 2.4 - - -
Dividends and others - 0.0 0.0 - 2.2 2.2
Net Revenues 14.8 17.3 32.1 12.4 13.8 26.2
Operating expenses (9.5) - (9.5) (8.6) - (8.6)
Bonus expenses (0.8) - (0.8) (0.6) - (0.6)
Carried interest (0.0) - (0.0) - - -
Provision for contingencies - (24.5) (24.5) - - -
Expenses (10.3) (24.5) (34.8) (9.2) - (9.2)
Intercompany management fee - (3.5) (3.5) - (3.6) (3.6)
Intercompany performance fee - (0.1) (0.1) - - -
Stock options - (0.6) (0.6) - (0.9) (0.9)
Financial income / loss net - (0.4) (0.4) - (10.2) (10.2)
EBT 4.5 (11.8) (7.3) 3.1 (0.9) 2.2
Income taxes (0.8) - (0.8) (0.6) - (0.6)
NET INCOME 3.6 (11.8) (8.2) 2.6 (0.9) 1.6
NAV Change Breakdown
GP Investments net asset value (NAV) stood at US$436.3 million as of March 31
st
, 2014. Excluding share
buybacks, this represents an increase of 1.1% for the period.
6
NAV Change Breakdown (In US$ million)
Magnesita $ (6.9)
BHG $ 2.7
Tempo i$ 2.5
Apen i $ (0.4)
Change in FMV: US$ 11.7
0.7
13.5
0.3 2.6
443.2
436.3
NAV1Q14

Other

Shares
Buyback

(11.6)
Net Financial
Expenses

(10.2)
Foreign
Exchange
on Portfolio
Privately-Held
Companies

Mark-to-
Market Effect

(2.1)
Fund
Management
Results

NAV4Q13

Intercompany fees: $(3.7)
Other: $ 4.4
Buyback Program
- 6.3 million shares bought in 1Q14
- ~13% of total capital bought
between 1Q13 and 1Q14
GPRE $ 0.3



Direct Investments

Agenda
Private Equity Portfolio (Consolidated Performance)
Consolidated net revenues of our portfolio companies grew by 13% and consolidated EBITDA increased by
20% in 1Q14 when compared to 1Q13. Operational improvements in SAI, BR Towers and Sascar were the
main drivers behind the increase in profitability.
8
* For analytical purposes, the figures do not include Estcio and the SAI Colombian unit, which were fully divested in 2013.
Net Revenues*
R$ million
EBITDA*
R$ million
+13%
1Q14
2,804
1Q13
2,479
1Q13 1Q14
+20%
302
251
Portfolio Companies in 1Q14
9
Company Recent Developments

1Q14 Operational Highlights

Publicly-traded Companies

Growth in refractory volumes
Record gross margin in the services unit
Completed studies for graphite project

Net revenues in 1Q14 16% higher than 1Q13
EBITDA margin of 13.7% in 1Q14
Acquisition of two hotels in So Paulo
Started operating Marina Palace in Rio

Net revenues 8% higher than 1Q13
Consolidated EBITDA of R$15 million (23.5% margin)
Merger of Sade Solues into Qualicorp
Concluded the sale of health insurance client portfolio

Net revenues 13% higher than 1Q13 to R$262
million
Consolidated EBITDA of R$10 million
10


Privately-held Companies

Clothing and private label are gaining space
Improved store operation, and costs reduced

Revenues up 23% to reach R$560 million (SSS
+8.4%)
E-commerce growing 120% with positive EBITDA
Strong G&A control and improved revenue mix
Accelerating growth in new segments

Net revenues 29% up in 1Q14 to R$76 million
EBITDA grew by 42% in 1Q14 to R$31 million
Two new salons, including the third in So Paulo
Launch of Linha Cachos with stores selling out

Revenues up 38% to reach R$42 million
Solid SSS growth rate
Serobrita (RJ) started commercial activities
Nova Petrpolis (RS) started sand operations

Revenues grew by 140% over 1Q13
Significant margin improvement expected
Strong growth from field marketing & merchandising
Better revenue mix over the quarter

Net revenues 5% up YoY to R$74 million
Debt remains under control (1.5x net debt/EBITDA)
Firm BTS agreements with local carriers
First BNDES disbursements completed in 1Q14

R$42 million in net revenues in the quarter
R$36 million in EBITDA in 1Q14 (86% margin)
11


Troubled Assets

Further cost cutting efforts
Actively pursuing monetization of tax credits

Revenues dropped by 7% compared to 1Q13,
reaching R$400 million
High levels of utilization in Argentina
Management focused on resolving the capital
structure at the holding level
EBITDA of US$50 million, up 84% over 1Q13*
* For comparative purposes, numbers shown in this page exclude past results for Colombia and Brazil.



Direct Investments

Agenda
Current Portfolio is Resilient to a Potential Economic Downturn
13
Key Strength Company

Competitive Advantage

Operational
Improvements for
B2B Market

Largest sales & merchandising services company in Brazil with technology-based
solutions to increase clients productivity

Proprietary tracking/monitoring systems to help clients increase security, safety and
productivity

Largest player in the market serving more than 5,000 corporate customers with more
than 150,000 options of assistance
Presence in Markets
with Repressed
Demand

Positioned to take advantage of sector tailwinds as carriers continue to deploy cell sites
to maintain network quality

Business model with multiple local units operating in the large and growing
infrastructure market

Focused on business tourism (three and four-star brands) in areas with high level of
economic activity
Real Estate Portfolio Presence in resilient markets: non-triple A office and middle class residential
Consumer Retail
Chains with
Resilient Business
Model

Leading sporting goods retailer in a market that has relatively low competition. Model
appealing to consumers from classes A to C

Emotional connection with women from income classes B and C (mostly). Cultural habit
of prioritizing expenditure with beauty and hair care
Low Exposure to
Brazil

Worlds most vertically integrated refractory producer, 64% of sales outside Brazil
Tempo Reaffirms the Thesis that GP Investments Portfolio is Resilient
14
Tempo implemented a series of operational improvements that have paved the way to successful exits. The
remaining business is resilient and the company can now focus on its most profitable and fastest-growing units
Important landmarks of
recent years:
Increase in the
Assistance units
profitability
Merger of Health
Service unit into
Qualicorp
Sale of risk units that
reduced business
complexity
EBITDA of remaining
units increased by
181% since 2011
50
36
15
-6
13
15
9
7
6
3 3
10
6
-11 -11
+181%
2013
59
2012
43
2011
21
Remaining units are
resilient and have
been growing strongly
Homecare
Assistance
Remaining Units
EBITDA
Health
Services
Health
Insurance
Dental Plans
Client portfolio sold
for R$30m
Merger with Qualicorp.
Expected proceeds of
R$138m
Sold for R$133m
Recent Transactions Have Unlocked Significant Value...
15
The comparison between the value of GP Investments stake in Tempo over time with the illustrative FMV pro-
forma for the recent transactions shows the significant FMV upside potential.
+29%
FMV Pro
Forma
33
1Q14
26
4Q13
22
3Q13
18
Based on Tempo's market capitalization at
the quarter's end with a 10% liquidity discount
Unlocking Tempos Value Value of GP Investments Stake Over Time
In US$ million In R$ million, unless otherwise noted
* Date prior to the announcement of the sale of the Health Insurance client
portfolio.
** For comparative purposes, based on 1Q14 exchange rate of R$2.263. Equity
value considers a 10% liquidity discount.
*** Excludes cash from asset sales/associations
Tempo's Market Cap. as of Nov. 4th, 2013* 427
FMV of GP Investments Stake in US$** 18
(+) 3Q13 Net Debt/(Cash) (82)
Enterprise Value 345
3Q13 LTM EBITDA of All Units 52
EV/EBITDA Multiple 6.6x
1Q14 LTM EBITDA of Remaining Units 57
EV/EBITDA Multiple 6.6x
Enterprise Value 378
(-) 1Q14 Net Debt/(Cash)*** (83)
Tempo's Implied Equity Value (A) 461
Est. Proceeds from Asset Sales/Associations (B) 301
FMV of GP Investments Stake in US$** (A + B) 33
...and Confirm the Hypothesis that Our Portfolio is Essentially Private
16
All units were sold in the private market at multiples higher than those Tempo had been
trading at
Approximately R$300 million in cash proceeds raised as result of the sale of the 3 business units
Transactions show how conservatively the values of some of the assets are being recorded on
our balance sheet
Tempo is well-positioned to deliver good results, replicating other success stories from GPCPIII
The combined result of the sale of the three business units confirms the hypothesis that our assets are
conservatively valued and that the real values of the assets are only fairly recognized at the time of a sale
Highlights
There is a clear opportunity for the realization of additional gains
as GP Investments continues to exit the company



Direct Investments

Agenda
Direct Investments
18
A listed Switzerland-based investment company with US$409 million of AuM as of
December 31, 2013. APEN is managed by GP Advisors.
On April 2
nd
, 2014, APEN announced its first two investments under the new
strategy of investing in emerging markets: a secondary position in Southeast Asia PE
fund Quvat Capital Partners II and a commitment to a Sub Saharan Africa PE fund.

In the middle of the second semester of 2013, GP Investments acquired from BRZ
Investimentos a minority stake equivalent to 18% of the total capital of Par
Corretora.
Par Corretora was founded in 1973 as the exclusive broker of insurance products of
Caixa Seguros.
Most of Par Corretoras sales are generated through Caixa Econmica Federals nearly
3,900 branches in Brazil.



Direct Investments

Agenda
As of March 31
st
, 2014, GPRE had committed to investing R$330 million (~132% of the total commitment) in
20 projects*
R$330 miilion or 132% of fund size is already
commited to 20 projects*
2 new projects added to the portfolio in 1Q14
12 projects have been launched, with an average
of 84% of units sold
R$2.2 billion of total PSV, R$1.2 billion to GPRE
Current FMV of 1.5x C-o-C on more advanced
projects and 1.3x in total fund (majority of projects
are at cost)
Real Estate (GPRE I Development Fund)
New Projects Added to GPRE in 1Q14
20
Highlights
* The over-investment is possible because the fund is permitted to re-invest proceeds received during its investment period and this gives additional dry
powder to pursue deals.
Real Estate Projects by Segment
R
e
s
i
d
e
n
t
i
a
l

M
i
x
e
d

U
s
e

So Paulo

PSV: R$99 million

Launch: Feb-15

Commited Capital:
R$14 million
Pretoria

Goinia

PSV: R$149 million

Launch: Nov-15

Commited Capital:
R$18 million
Avenida 85
Other Asset Management Verticals
GP Advisors and BRZ Investimentos represent additional verticals of growth in AuM through investments in
Brazil and emerging markets, contributing to the diversification of GP Investments product mix
GP INVESTMENTS
GP Asset
Management
Private
Equity
Real Estate Infrastructure
Develop
New
Asset
Classes
Growth
in AUM
Apen

GP Advisors focuses on private equity through both
secondary investments and direct co-investments,
concentrating on emerging markets opportunities, so
providing further products and business
diversification for GP Investments.
The company currently manages the portfolio of
APEN and in the first quarter of this year contributed
US$1.4 million to GPs management fees.

BRZ Investimentos is one of the biggest independent
asset management firms for institutional investors in
Brazil.
The companys AUM remained stable at R$4.4 billion
in 1Q14 in comparison to 1Q13, despite market
volatility caused by the uncertain political scenario which
impacted the flow of equity funds. On the other hand, the
Illiquid Funds area showed strength and resilience.

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