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Partners Group more upbeat on 2024 after flat 2023 profit

ZURICH (Reuters) -Swiss investment company Partners Group reported on Tuesday flat annual profit for 2023, held back by a difficult environment for realising investments, but said it saw that situation improving this year and proposed a higher dividend.

The firm reported a profit of 1.003 billion Swiss francs ($1.13 billion) compared with 1.005 billion in 2022, while revenue increased 4% to 1.945 billion francs.

It proposed a dividend of 39 francs per share, up from 37 francs the year before.

Partners Group also reaffirmed its guidance from January that it expects to raise $20 billion to $25 billion from clients this year amid a normalization of the investment environment and strong interest in its investment products.

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"Looking into 2024, our growing pipeline of high-quality assets and normalizing market conditions give us confidence for improving exit activity," CEO David Layton said.

Partners Group shares were down 3% in afternoon trade in Zurich.

Analysts said the results were below expectations, but were upbeat about the firm's outlook.

Luzerner Kantonalbank analyst Daniel Bosshard said Partners Group was in "pole position" to continue to attract new money.

"Demand for private market investments appears to remain unbroken, as pension funds and life insurers are still dependent on the corresponding returns," he said.

On Monday, Partners Group said it was adding private markets royalties as a fifth asset class to its portfolio, focusing on royalty sectors such as intellectual property assets in the pharmaceuticals and entertainment industries, as well as the energy transition, sports and brands.

The group estimates the market to be worth $1 trillion, but didn't say how much of that it hopes to capture.

"In 5 to 10 years we want to get to $10 billion," Chairman Steffen Meister told Reuters.

"We don’t want to open up any new asset class if we can’t do $10 billion, otherwise it is not worthwhile."

($1 = 0.8887 Swiss francs)

(Reporting by Noele Illien; Editing by Varun H K and Mark Potter)