Hg Capital delivered a 3.8% return on net assets for the six months ended 30 June 2015 and the return to shareholders for the period was 7.2%. By comparison, the return on the FTSE All-Share Index for the period was 3.0%. The valuation uplift was driven by a combination of growth within the businesses of the investee companies, strong cash generation and higher prices of the listed companies used to value their investments.
£40m of investments were made in the period including The Foundry, A-Plan and Eucon and the portfolio threw off cash of £17m as Zenith Leasedrive was refinanced and they sold Sporting Index (for 50% more than its value at the end of 2014).
Their cash pile is growing and is on track to hit £41m or 9% of NAV when the proceeds of the sale of Simonsvoss arrive in September. Against this they have outstanding commitments of £169m which they expect to be called down at a rate of about £20m per quarter.
HGT : Discount narrowing boosts Hg Capital return