HarbourVest Global Private Equity (HVPE) has announced its annual results for the year ended 31 January 2021, during which it has provided NAV per share increase of 30.4% over the financial year – the largest 12-month increase in HVPE’s 13-year history. It says that this compares against a return of 17.4% for its FTSE All-World Index Benchmark (total return in US dollars).
During the period, there was a $682.3 million net gain on investments, contributing to an overall increase in net assets of $669.8 million. Of the $682.3 million, the majority – 84% – came from unrealised growth within the portfolio. This compares with a $289.3 million net gain on investments and an overall increase in net assets of $278.7 million for the 12 months to 31 January 2020. The higher overall net gains in this reporting period compared with the same period last year reflect the strong performance of the underlying portfolio, particularly in overweight exposures such as technology and, to a lesser extent, healthcare. At 31 January 2021, the top 100 companies in the portfolio represented 35.3% of the Investment Portfolio and the top 1,000 companies represented 84.6%.
As at 31 January 2021, HVPE held investments in 51 HarbourVest funds and 10 secondary co-investments1 (compared with 49 and seven, respectively, at 31 January 2020). Of these, the largest drivers of NAV per share growth during the 12 months to 31 January 2021 are described below:
- Fund X Venture, a US-focused venture fund-of-funds, was the largest contributor, adding $0.84 to NAV per share. With a vintage year of 2015, this fund is in the growth phase. This growth came predominantly from unrealised gains over the period.
- Following closely behind this was Fund IX Venture, an earlier fund of the same strategy, adding $0.81 to NAV per share. This is a 2011 vintage fund now entering its mature phase. Nevertheless, this uplift was derived primarily from unrealised gains over the period.
- Co-Investment IV, a global direct co-investment fund, added $0.66. This 2016 vintage fund is in the investment phase. As might be expected at this stage of the fund’s life, most of this growth was driven by unrealised gains.
- HIPEP VII, a 2014 vintage international fund-of-funds, was the fourth largest contributor adding $0.50 to NAV per share over the period.
- Fund X Buyout, a 2015 vintage US-focused buyout fund-of-funds, added $0.46 to NAV per share.
All of the remaining HarbourVest funds in the portfolio added an aggregate $5.34 to HVPE’s NAV per share over the financial year.
Portfolio Cash Flows and Balance Sheet
HVPE was a net investor in the 12 months to 31 January 2021, following capital calls of $430.9 million into HarbourVest funds (12 months to 31 January 2020: $324.2 million) and cash distributions of $289.5 million (12 months to 31 January 2020: $308.2 million). This resulted in net investment of $141.4 million over the reporting period, driven by elevated capital calls during March and April 2020. While this capital was deployed primarily into new opportunities, part of the total was used to support existing investments and to fund deals closed in the preceding months.