The private equity sector company, ICG Enterprise (ICGT), reported interim results to 31 July 2020, delivering a NAV total return of (1.0%). This was ahead of the FTSE all-share, which returned (17.8%) over the period.
ICGT had a good second quarter, with the 3.2% total return coming in well ahead of the (4.1%) over the first quarter.
Some of the main performance highlights from the interim period include:
- +0.1% sterling return on the Portfolio; (3.6%) local currency return
- +15% average last 12-months (LTM) earnings growth from the top 30 underlying companies which represents 47% of IGCT’s portfolio. IGCT says that this compares with (24%) LTM EBITDA growth for the FTSE all-share index.
- Continued realisation and secondary sales activity generates £94m of proceeds for IGCT
- £39m of proceeds from realisations; 7% uplift to carrying value; 2.0x multiple to cost
- £55m of proceeds received and £21m of undrawn commitments released by secondary sales
- Further selective secondary sales completed post period end to re-balance the portfolio and expand investment capacity
Dividend maintained at 5p and £197m of liquidity available
IGCT maintained its first and second quarter dividend of 5p. It also noted that it has £197m of available liquidity to fund uncalled commitments and capitalise on new investment opportunities. Over the interim period, the company made five new primary fund commitments.
Oliver Gardey, head of private equity fund investments, ICG, commented: “We have been pleased by the performance, realisation activity and resilience of the portfolio through a period of extraordinary disruption caused by the COVID-19 pandemic. These results demonstrate the benefit of our focus on investing in market-leading, defensive growth companies, alongside top-tier private equity managers. They also highlight, more broadly, the benefit of the private equity model – its focus on long term investing means we are well suited to managing through challenging economic cycles such as these.
We have constructed a portfolio with strong defensive characteristics, focused on mature buyouts in Europe and North America. Despite the disruption caused by the pandemic, we have been able to continue our realisation and selective secondary sales activity to help re-balance the Portfolio and expand investment activity. It was particularly pleasing to report PAI’s agreed sale of Roompot from our high conviction portfolio, which resulted in a significant uplift to the value of our holding in the company.
Previous crises have demonstrated that market dislocation and volatility can also create opportunities. We have continued to focus on selecting new commitments to leading fund managers and built a pipeline of exciting high conviction investment opportunities. We believe the decisive action we have taken in the last six months, the strength of the current portfolio and our commitments to some of the world’s leading buyout managers leave us well placed to continue delivering long-term shareholder value.”
ICGT: ICG Enterprise displays resilience over second quarter