PSP Investments Posts 10.7% 10-Year Annualized Rate of Return as Net Assets Under Management Grow by 9.7% to $168 Billion in Fiscal Year 2019

- Ten-year net annualized return of 10.7% -- above the return
objective of 5.8% -- generated $48.8 billion of cumulative excess net
investment gains.

- One-year total portfolio net return of 7.1% generated $11.7
billion of performance income.

- Net assets under management grew by 9.7% to $168.0 billion, up
from $153.1 billion in fiscal year 2018.

Montréal (ots/PRNewswire) - The Public Sector Pension Investment
Board (PSP Investments) announced today that it ended its fiscal year
March 31, 2019, with net assets under management (AUM) of $168.0
billion, compared to $153.1 billion the previous fiscal year, an
increase of 9.7%. The investment manager also reported a one-year
total portfolio net return of 7.1% and a 10-year net annualized
return of 10.7% on its investments and generated $90.1 billion of
cumulative 10-year net performance income and $48.8 billion of
cumulative net investment gains above the return objective.

"We have great reason to be proud of our strong performance and
evolution on the world stage," said Neil Cunningham, President and
Chief Executive Officer at PSP Investments. "We saw robust levels of
investments throughout fiscal year 2019 and, despite market
headwinds, these results clearly show the long-term success of our
diversified investment approach in delivering value for our
stakeholders."

"Fiscal year 2019 was impacted by higher volatility in public
markets amid concerns of a global economic slowdown," added Mr.
Cunningham. "Our performance demonstrates the benefits of our
strategy to diversify the portfolio across a number of public and
private asset classes, to produce a strong positive overall return.
Likewise, our strategic partners and platforms across all asset
classes continued to generate attractive risk-adjusted investment
opportunities, as we all worked together to spot the edge on
investments to generate robust long-term returns."

PSP Investments' net assets increased by nearly $15 billion during
fiscal year 2019. The increase is attributable to net contributions
of $3.7 billion received by PSP Investments and the net return of
7.1% in the current fiscal year.

Asset Class
Highlights
ASSET CLASS NET ONE-YEAR FIVE-YEARRETURN % OF
ASSETSUNDER RETURN TOTAL
MANAGEMENT1 NET
ASSETS
Public Markets $80.8B 4.6% 8.0% 48.1%
Private Equity $23.5B 16.1% 7.9% 14.0%
Private Debt $10.5B 9.2% 14.2%2 6.2%
Real Estate $23.5B 7.6% 11.8% 14.0%
Infrastructure $16.8B 7.1% 12.7% 10.0%
Natural $ 11.1% 12.0% 4.0%
Resources 6.8B
Complementary $ 0.04% 15.6%3 0.9%
Portfolio 1.4B
1. This table
excludes Cash
and Cash
equivalents.
2. Annualized
return since
inception (3.3
years).
3. Annualized
return since
inception (2.2
years).

As of March 31, 2019:

Public Markets, which is composed of Public Markets and Absolute
Return Strategies (PMARS) and Fixed Income, finished the year with
$80.8 billion of net assets under management, an increase of $4.1
billion from fiscal year 2019. Overall, the group generated a
performance income of $3.6 billion, for a one-year return of 4.6%.
With an ending AUM of $51.0 billion, slightly down from $51.8 billion
in 2018, PMARS faced a volatile and challenging environment for
active investment management this fiscal year. Notable contributors
to PMARS' performance were the Global Investment Partnerships
Portfolio that performed well in these difficult conditions, adding
more than $110 million in value and the internally managed long-only
strategies which outperformed their respective benchmarks. In the
last five years, PMARS generated significant returns, with a
five-year annualized return of 9.3%. Fixed Income's assets under
management ended the year at $29.8 billion, up from $24.9 billion in
2018, generating a five-year annualized return of 4.8%.

Private Equity had net assets under management of $23.5 billion,
$4.1 billion more than in fiscal year 2018, and achieved strong
results with a one-year return of 16.1%. Performance income reached
$3.2 billion. This is a continuation of the improved performance that
began with a new investment strategy implemented during fiscal year
2016. The growth of the portfolio was mainly driven by acquisitions
of new direct and co-investments, largely offset with a record year
of dispositions, especially in the direct portfolio where we exited
investments in Orange Life Insurance and Sky Leasing, as well as
Antelliq, which closed after fiscal year-end. New co-investments were
made primarily in the industrial, health care, communications and
financial sectors with the acquisition of significant interests in
Alliant Insurance Services, Azelis and Wittur Group, among others.
In 2019, Private Equity signed new fund commitments of $3.5 billion,
through 16 new funds.

Private Debt had net assets under management of $10.5 billion, an
increase of $1.6 billion from the prior fiscal year, and generated
performance income of $837 million, resulting in a 9.2% one-year
return. The outperformance was mainly driven by credit selection and
fee income. The group deployed net $1.6 billion, reflecting $5.2
billion in acquisitions partially offset by $3.6 billion in
dispositions, driven by the higher churn of the maturing portfolio.
The group's portfolio is well diversified across geographies,
industries, equity sponsors and asset types, heavily weighted toward
floating rate exposure and reflects the contribution of the fully
ramped-up Private Debt team in London.

Real Estate had $23.5 billion in net assets under management, up
by $0.3 billion from the previous fiscal year, and generated $1.7
billion in performance income, resulting in a 7.6% one-year return.
Real Estate's focus was on optimizing the portfolio. Net deployments
were close to break-even as the group disposed of many core assets
with completed business plans in the office and multifamily sectors
in the US and non-strategic assets in Brazil and in the US. The
group also recapitalized the student housing portfolio in London with
Greystar. With a low-yield environment making it more challenging to
acquire core assets, the strategy behind a number of acquisitions in
North America and emerging markets was value-add or opportunistic.
The largest single acquisition was the Downsview airport land in
Toronto, which is a long-term re-development project that aligns with
Real Estate's build-to-core strategy in primary and growth markets.
During fiscal year 2019, Darren Baccus was appointed as Senior Vice
President and Global Head of Real Estate and Natural Resources.

Infrastructure had $16.8 billion in net assets under management, a
$1.8 billion increase from the prior fiscal year, and generated $1.1
billion of performance income, leading to a 7.1% one-year return,
primarily attributable to investments in the transportation and
utilities sectors in Europe and North America. The group deployed
$1.7 billion in new direct and co-investments in fiscal year 2019,
while disposing of non-strategic investments totalling $0.6 billion.
Infrastructure deployment was mostly across Europe and the US. Key
investments included the acquisition of a majority interest in Forth
Ports, the third-largest port operator by volume in the UK, and the
acquisition by Roadis, PSP's road platform, of a controlling interest
in two roads located in Portugal. Portfolio geographic
diversification evolved with increased exposure to the US market and
decreased exposure in Europe, Asia and Oceania.

Natural Resources had net assets under management of $6.8 billion,
an increase of $2.0 billion from the previous fiscal year, and
generated performance income of $574 million, for a one-year return
of 11.1%. Fiscal year 2019 was marked by continued strong deployment
in Australia, North America and selected regions in Latin America
with significant investments in new agriculture joint ventures.
Notable developments also included the strategic alliance of
TimberWest and Island Timberlands, leading to the establishment of
Mosaic Forest Management, which enables the shared use of facilities,
enhanced forest stewardship and alignment of best practices.

Total Costs

PSP Investments' total cost ratio was 67.3 cents per $100 of
average net investment assets in fiscal year 2019, compared to 69.8
cents in fiscal year 2018, and 70.5 cents in fiscal year 2017.
Operating costs have remained constant at 31.7 cents for fiscal year
2019, the same as for fiscal year 2018. The stability in our cost
ratios reflects PSP Investments' focus on enhanced cost management as
we achieve our Vision 2021 strategic plan. These ratios can vary
year-over-year as they are impacted by net AUM's fluctuations.

Corporate Highlights

- We expanded our global footprint, opening a third international
office in Hong Kong to support our global portfolio. Within the
framework of our Vision 2021 plan, we significantly scaled our
investment strategies, added new asset classes and are well on
track to reach over $250.0 billion of assets under management by
2028.
- As part of our One PSP vision, we implemented a total fund approach
to our investment strategies, decision-making processes and risk
management, while maintaining an entrepreneurial and agile culture.
In July, Eduard van Gelderen was appointed as Senior Vice President
and Chief Investment Officer, bringing strong market knowledge,
investment expertise, international experience and leadership
skills.
- We implemented our new and far-reaching Talent Value Proposition to
enhance the overall employee experience with a focus on moments
that matter in attraction, development, reward and retention, as we
continued to make inclusion and diversity a leadership commitment.
At PSP Investments, women hold 36.4% of senior positions, while
members of visible minority groups represent 18.5% of our Canadian
workforce.
- We continued to affirm our commitment to inclusion and diversity
(i&D) through the work of our i&D Council, co-chaired by our
President and CEO and Chief Human Resources Officer. Our i&D
strategy promotes a wide variety of viewpoints and a respectful
work environment that encourages and values differences. During
fiscal year 2019, 60 very committed PSP employees led at least one
major activity for each of our eight affinity groups and leveraged
technology to include employees across our Canadian and
international offices.
- We deployed our new brand -Spot the edge-across multiple platforms,
positioning PSP as an employer, partner and investor of choice.
- We continued to embed environmental, social and governance
considerations into every aspect of the investment process, across
all asset classes. Accomplishments included achieving key
milestones in our multi-year climate change strategy, broadening
engagement with public issuers on healthy corporate culture and
conduct, and promoting meaningful disclosure practices. Our third
annual Responsible Investment Report can be consulted here (https:/
/www.investpsp.com/media/filer_public/documents/PSP-2019-responsibl
e-investment-report-en.pdf).

"The Total Fund perspective has been a top corporate priority for
PSP since the beginning of Vision 2021," said Eduard van Gelderen,
Senior Vice President and Chief Investment Officer at PSP
Investments. "Significant progress has been made to lead the
organizational shift toward a balanced mix of bottom-up and top-down
strategies. We are very pleased to see that the collaboration between
the asset classes, the CIO Office and the Risk department has led to
new investment insights. This integrated approach remains a top
priority in the year to come."

"Thanks to our expert and diverse team, PSP has developed a
worldwide reputation as an investor that spots the edge and has an
inclusive and diverse culture," said Mr. Cunningham. "As we enter our
twentieth year of operations, our focus on the long-term horizon and
on building a world-class team continues to drive our investment
efforts on behalf of contributors and beneficiaries who have
dedicated their careers to serving Canada."

For more information on PSP Investments' fiscal year 2019
performance, visit www.investpsp.com or download the annual report
here (https://www.investpsp.com/media/filer_public/documents/PSP-2019
-annual-report-en.pdf).

All $ are CAD

About PSP Investments

The Public Sector Pension Investment Board (PSP Investments) is
one of Canada's largest pension investment managers with $168 billion
of net assets under management as of March 31, 2019. It manages a
diversified global portfolio composed of investments in public
financial markets, private equity, real estate, infrastructure,
natural resources and private debt. Established in 1999, PSP
Investments manages net contributions to the pension funds of the
federal Public Service, the Canadian Forces, the Royal Canadian
Mounted Police and the Reserve Force. Headquartered in Ottawa, PSP
Investments has its principal business office in Montréal and offices
in New York, London and Hong Kong. For more information, visit
www.investpsp.com or follow us on Twitter
(https://twitter.com/investpsp?lang=en)and LinkedIn
(https://www.linkedin.com/company/23319/admin/).

Media Contacts
Maria Constantinescu PSP Investments
Canada: +1-514-218-3795
Toll free: +1-844-525-3795
Email: media@investpsp.ca

ots Originaltext: PSP Investments
Im Internet recherchierbar: http://www.presseportal.de

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