REG - Forward Partners Grp - Trading Update

Forward PartnersAnnouncement

24/08/2022 07:01

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RNS Number : 9780W  Forward Partners Group PLC  24 August 2022

Forward Partners Group plc

("Forward Partners" or "the Group")

TRADING UPDATE

 

Forward Partners Group plc (LSE: FWD), the London-based investment firm
specialising in supporting high-growth, early-stage technology businesses,
provides an update on trading for the six-month period to 30 June 2022
including a decision to affect a managed wind down of the Group's Forward
Advances subsidiary.

Forward Ventures

The Group anticipates Ventures Portfolio Value at the half-year to 30 June
2022 to be no less than £92.0m inclusive of £6.3m in new investments. As
previously indicated at the 2021 final year results, this represents a decline
of 26.4% exclusive of these new investments.

NAV per share is expected to be not less than 83.4 pence per share of which
cash per share is expected to be 16.8 pence.

Portfolio highlights

As previously noted, valuation headwinds from the decline in share prices at
high growth tech stocks are the primary driver of the drop in the Ventures
Portfolio Value. The performance of the underlying portfolio remains strong:

●    Average forecast revenue growth of the Top 15* portfolio investments
by Fair Value of 40-60% for the full year.**

●    Over 80% of the Top 15* portfolio investments are anticipated to be
on the path to break even without the need for further fundraising or have
sufficient resources to negate the need for fundraising for 18 months or
more.**

●    £6.3m investments made during the period which includes 12
follow-on investments totalling £4.9m and new investments in two high growth,
early-stage technology companies - Baselime and Sonrai, totalling £1.4m.

●    The Top 15* portfolio investments account for 69.0% of Venture
Portfolio Value, with the most valuable company accounting for 9.8%.
Investment in the Top 15 to date totals £25.8m.*** 61.7% of the portfolio
comprise B2B companies.

Forward Advances

The Group has decided to conduct a managed wind down of its subsidiary Forward
Partners Venture Advance Limited ("Advances"). The start-up venture was
established in 2020 to meet the demand of the fast-growing alternative funding
market, separate to venture capital. Since then, it has originated £14.9m,
aiding consumer-focused eCommerce companies to increase revenues through short
term unsecured funding.

Forward Partners continually reviews its business against its primary
objective to create long-term sustainable shareholder value and has judged
that the current macroeconomic environment and the low margins necessary for
Advances to compete in the alternative funding market have limited
opportunities for future growth of the subsidiary. Consequently, the managed
wind down of Advances' operations will commence from today. While no further
funding will be originated or made, current Advances customers will be fully
serviced for the duration of their contracts.

In the year to 31 December 2021, Advances generated revenues of £366k and
recorded losses after tax of £1.1m, with total originations of £9.5m.
Advances book value at 30 June is expected to be £1.9m. Repayments from
outstanding Advances remain in line with forecasts, and costs this financial
year, including wind down costs, are anticipated to be £2.8m.

The Group will use the capital conserved to support Ventures in investing into
new technology businesses with strong fundamentals and existing portfolio
companies that we know and trust. Our forecasts show that a managed wind down
of Advances will reduce operating costs and, over time, strengthen the Group's
balance sheet.

ENDS

NOTES

* Top 15 portfolio investments denotes the most valuable companies held in
Forward's Venture portfolio by Fair Value at a point in time. Except where
otherwise noted, in this release we refer to the Top 15 at 31 December 2021 to
provide a meaningful basis for comparison. At that time, the Top 15 comprised
Ably, Gravity Sketch, Makers, Spoke, Patch, Snaptrip, Cazoo, Robin AI, Apexx,
Juno, KoruKids, Cherryz, Koyo Loans, Lexoo and Counting Up. The Top 15 is
subject to change at the publication of the full interim results.

** Management estimates as of 12 August 2022. These are based on portfolio
company forecasts and assume no further material deterioration in the economy
or public technology stocks that the Company utilises in comparable
valuations. Revenue growth average weighted by the Fair Value of portfolio
companies at 31 December 2021.

*** Investment in Top 15 portfolio investments to 30 June 2022.

Enquiries

 FORWARD PARTNERS GROUP PLC               Via Maitland/amo
 Nic Brisbourne, Chief Executive Officer

 

 LIBERUM CAPITAL LIMITED
 (Nominated Adviser and Broker)  Tel: +44 20 3100 2222
 Neil Patel
 Lauren Kettle
 Edward Phillips
 Cara Murphy

 

 Maitland/amo (Financial PR)          forwardpartners@maitland.co.uk (mailto:forwardpartners@maitland.co.uk)
 Sam Turvey, Alistair de Kare-Silver  Tel: +44 (0) 207 379 5151

About Forward Partners

Founded in 2013, Forward Partners is an established and respected London-based
venture capital firm, specialising in supporting high growth, early-stage
technology businesses.

The Group brings together venture capital provider Forward Ventures with
highly specialised growth support from Forward Studio. This model supports
founders to build stronger businesses faster to provide better outcomes for
companies and investors alike.

The Group makes equity investments in early-stage, high growth UK companies,
and from inception to its admission to London's AIM market in July 2021 had
made over 60 unique investments and built a portfolio with an Initial
Portfolio NAV in excess of £100m. It holds an eight-year track record of
making venture capital investments, and targets underlying NAV growth of 20%
per annum on average over the cycle.

The management team brings together highly experienced venture capitalists,
entrepreneurs, and expert consultants. Since 2015, Forward Partners has been
backed by BlackRock, one of the largest institutional investors in the world.
The Group receives over 4,000 start-up funding applications every year.

For more information, visit https://forwardpartners.com
(https://forwardpartners.com)

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