In QuotedData’s morning briefing 13 September 2024:

• RTW Biotech Opportunities (RTW) has announced its interim results for the six months ended 30 June 2024, during which its NAV was up 3.0% and its share price was up 10.1%. In comparison, RTW says that its comparator indices – Russell 2000 Biotech and Nasdaq Biotech were up 1.7% and 4.0% respectively. RTW’s discount narrowed during the first six months of the year, particularly after the closing of the Arix deal and RTW says that with the sector continuing its recovery, it expects the discount to narrow further from here. RTW says that it has been an intense period of activity for the group, with 14 new core positions initiated, an IPO for Kyverna Therapeutics and a reverse merger involving Lenz Therapeutics and Graphite Bio. It adds that it has also seen some very encouraging scientific data from the Group’s largest holding, Avidity Biosciences and other core positions including Apogee Therapeutics and Tarsus Pharmaceuticals. Elsewhere, the group has participated in a number of financings including JIXING which also saw the concurrent announcement of a new strategic collaboration with Bayer. RTW comments that the market environment for the biotech sector is improving and the opportunity set for stock picking is encouraging. It notes that the sector’s recovery is still early and changes in interest rate expectations are adding periods of volatility, but good data and good products are being rewarded it says.
• Schiehallion (MNTN) has released its interim results for the six months to 31 July 2024 during which its NAV total return was -3.2% but its share price increased by 44.1% over the period, causing the discount to narrow to 10.1%. Both private and public holdings contributed to the NAV decrease. On the public side, key negative contributors were buy-now pay-later provider Affirm and foreign exchange platform Wise. Affirm’s share price dropped 42% and Wise’s dropped 17% but MNTN says that the underlying operational performance at both companies was still strong. Affirm saw 51% revenue growth and achieving over one million users of its Affirm Card product, whilst Wise grew revenues 23% and more than tripled profits. Over the life of the fund, both stocks remain strong net contributors to MNTN’s performance. On the private side, German real estate broker McMakler was the main negative contributor, as it continues to battle macroeconomic headwinds in the domestic property market. Positive contributors included Italian consumer digital application company Bending Spoons and American expense management and credit card company Brex. MNTN says that Bending Spoons has continued to deliver strong operational performance and show signs of having successfully integrated its recent acquisitions. Across the portfolio, operating performance remains broadly strong. Portfolio-weighted revenue growth was 41% over the period, with 39% of the companies by portfolio weighting being EBITDA-positive, and nearly 50% of companies in total being cash generative. The vast majority of the companies within the portfolio have cash balances greater than a year, with just under 5% having less than 12 months cash runway. During the period, MNTN made one new investment and completed two sales. The new investment was in Tekever, a Portuguese aerial intelligence company that produces software-defined autonomous surveillance drones for both non-lethal military and civilian use cases. The sales were of public company Allbirds and private company Graphcore.
• Baker Steel Resources Trust (BSRT) has published its interim results for the six months ended 30 June 2024, during which its NAV per share increased by 4.9% to 81.0p with the share price rising by 34% to 53.0p at 30 June 2024 (this still puts the shares on a 35% discount to NAV at 30 June). BSRT says that, following several barren years in the funding market for junior mining development companies, it has noticed several green shoots appearing in the first half of 2024, and it is hoped that the market may have turned for the sector in which the company invests. BSRT says that the general market, as represented by the larger producers in the MSCI World Metals and Mining Index, rose 11.4% on the back of stronger commodity prices. This was led by gold which moved to an all-time high, up 12.8% on 30 June 2024 and, since that date it has risen further to US$2,500 per ounce. Despite this, gold-based equities still trade at around two thirds of the share prices which they recorded when bullion was some US$700 per ounce lower. BSRT says that the underperformance of equities compared to metals prices, although most striking in the gold sector, also applies to the general mining market which has, in turn, lagged the overall stock market in recent years. Despite recent gains and growing M&A activity, the junior mining equity market can only be regarded currently as one in recovery rather than in a bull market.
• Further to its announcement on 6 September 2024 (click here to see our coverage) JPMorgan Emerging EMEA Securities (JEMA) has provided an update on the Russian Court order. JEMA says that, on 11 September 2024 the company’s manager informed its board of the following:“The Russian court has postponed a main hearing of a lawsuit filed by VTB Bank against nine J.P. Morgan legal entities to 16th October 2024. If judgment is given at this hearing, J.P. Morgan would have the right to appeal and the appeal process would likely last approximately 2 months. No seizure of J.P. Morgan’s assets under the judgment is expected to take place during this time. We will continue to provide further details to our clients as the situation develops.” JEMA says that its board will provide a further update once the court decision is announced.
• Polar Capital Technology (PCT) has completed the 10 for 1 sub-division of its ordinary shares: each 25p pence ordinary share has been split into new ordinary shares of 2.5 pence each, which was approved by shareholders at the annual general meeting of the company held on 11 September 2024.
• Third Point Investors (TPOU) has published its interim results for the period six months ended 30 June 2024. TPOU returned 11.4% on a NAV total return basis and 14.6% on a share price basis, which it says compares with a 12.0% return for the MSCI World Index and a 15.3% return for the S&P 500 Index over the same period. Long equity positions contributed strongly to fund performance (+12.2% gross), which was led by Vistra, a Texas-based energy company, that has appreciated in light of AI’s considerable power demands. Other top contributors included Amazon, Meta, TSMC and Microsoft, all of which exhibited positive earnings momentum, due at least in part to the growth of AI. Detractors included Du Pont deNemours, Bath & Body Works, Airbus and Humana. Short equity positions detracted from performance overall (-2.1% gross), with all detraction coming from portfolio and position-level hedges while single name short positions were flat. Corporate credit and structured credit contributed modestly positive additions to performance (+1.5% gross). The corporate credit portfolio outperformed the High Yield Index with positive contribution from cable positions in Radiate and Frontier Communications. The structured credit portfolio outperformed the broad fixed income index, led by spread tightening in residential mortgage-backed securities, and the decision to remain hedged on interest rates. The privates portfolio had gains (+0.6% gross) due to positive developments from a single position.

We also have:

• The publication of circular by Alliance Trust and Witan in relation to their proposed merger.