REG - Georgia Capital PLC - 1st Quarter Results
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RNS Number : 1016C Georgia Capital PLC 28 April 2026
FINANCIAL PERFORMANCE HIGHLIGHTS (IFRS)(( 1 (#_ftn1) ))
GEL '000, unless otherwise noted Mar-26 Dec-25 Change
Georgia Capital NAV overview
NAV per share, GEL 154.82 154.68 0.1%
NAV per share, GBP 43.34 42.44 2.1%
Net Asset Value (NAV) 5,152,073 5,194,527 -0.8%
Shares outstanding(( 2 (#_ftn2) )) 33,278,673 33,582,800 -0.9%
Cash, liquid funds and accrued dividends 3 (#_ftn3) 230,201 239,801 -4.0%
NCC ratio(2) 3.9% 2.3% 1.6 ppts
Georgia Capital Performance 1Q26 1Q25 Change
Total portfolio value creation 48,844 343,493 -85.8%
of which, listed portfolio (29,161) 247,949 NMF
of which, private businesses 78,005 95,544 -18.4%
Investments 1,265 11,702 -89.2%
Divestments (42,809) - NMF
Buybacks(( 4 (#_ftn4) )) 76,026 87,876 -13.5%
Dividend income(( 5 (#_ftn5) )) 39,558 8,007 NMF
Net income 29,915 334,199 -91.0%
Private portfolio companies' performance(1) 1Q26 1Q25 Change
Large portfolio companies
Revenue 489,409 430,390 13.7%
EBITDA 72,569 57,181 26.9%
Net operating cash flow 55,920 43,096 29.8%
Total portfolio(( 6 (#_ftn6) ))
Revenue 594,341 523,421 13.5%
EBITDA 95,061 77,637 22.4%
Net operating cash flow 72,602 68,000 6.8%
KEY POINTS
Ø NAV per share was flat at GEL 154.82 in GEL terms and increased by 2.1%
q-o-q in GBP terms in 1Q26, reflecting strong value creation across the large
private portfolio companies, partially offset by slight decrease in Lion
Finance Group's share price during the quarter. Subsequent to 1Q26, Lion
Finance Group's share price performance has been strong
Ø Outstanding quarterly results across our private large portfolio companies,
with aggregated revenues and EBITDA increasing by 13.7% and 26.9% y-o-y,
respectively, in 1Q26, leading to a 29.8% y-o-y increase in net operating cash
flow
Ø Lion Finance Group was promoted to the FTSE 100 Index, reflecting its
consistently superior financial and operational performance and significantly
expanded market capitalisation over the last few years
Ø 475,000 shares repurchased for US$ 22.0 million (GEL 59.8 million) in 1Q26,
bringing total shareholder repurchases since the demerger to US$ 261 million,
representing 33.7(( 7 (#_ftn7) ))% of the issued share capital at its peak
Ø NCC ratio up 1.6 ppts to 3.9% in 1Q26, mainly reflecting committing funds
to the launch of a new US$ 50 million share buyback and cancellation programme
in February 2026
Ø Subsequent to 1Q26, as of 27 April 2026, NAV per share has increased by
9.2% YTD to GEL 168.92 in GEL terms and by 9.6% YTD to GBP 46.50 in GBP terms,
primarily reflecting the significant appreciation in Lion Finance Group's
share price
Conference call: An investor/analyst conference call will be held on
28-APR-2026, at 14:00 UK / 15:00 CEST / 09:00 US Eastern Time. Please register
at the Registration Link
(https://gcap-ge.zoom.us/webinar/register/WN_OOSlKPGTSM65IxS3_NuJNg) to attend
the event. Further details are available on the Group's webpage
(https://georgiacapital.ge/) .
CHAIRMAN AND CEO'S STATEMENT
I am pleased to present Georgia Capital's 1Q26 results, which mark a strong
start to 2026, particularly reflecting sustained growth momentum in our
private portfolio businesses, alongside the disciplined execution of our
strategic priorities. Against a backdrop of heightened global geopolitical
uncertainty in the Middle East region, our large private portfolio companies
once again demonstrated the strength and resilience of their market positions,
delivering robust operational performance and strong top-line growth while
reaffirming their standing as high-quality, industry-leading businesses. To
date, the turbulence in the Middle East region has had minimal impact on our
large portfolio business operations.
NAV per share (GEL) was flat, up 0.1% q-o-q to GEL 154.82 in 1Q26. Despite the
challenging global geopolitical backdrop during the quarter, NAV per share
remained flat in GEL terms and increased by 2.1% q-o-q in GBP terms. The
performance was driven by GEL 48.8 million value creation from our portfolio
companies (a 0.9 ppts positive impact on NAV per share). The private portfolio
delivered GEL 78.0 million value creation in 1Q26 (+1.5 ppts impact),
underpinned by outstanding performances from our large private portfolio
companies, which delivered GEL 103.7 million value creation, partially offset
by a GEL 25.7 million value reduction in emerging and other businesses,
largely attributable to a one-off write-down in our renewable energy business
following the decision to discontinue two pipeline projects. Our listed
portfolio saw a GEL 29.2 million value reduction (-0.6 ppts impact),
attributable to 2.0% q-o-q GEL appreciation against the GBP and a largely flat
Lion Finance Group's share price performance (-0.2% q-o-q). The NAV per share
growth was also supported by our share buyback and cancellation programme
(+0.3 ppts impact). This was offset by GEL appreciation against GBP as
mentioned above and management platform costs and net interest expense with a
combined negative 1.2 ppts impact. Subsequent to 1Q26, as of 27 April 2026,
NAV per share has increased by 9.2% YTD to GEL 168.92 in GEL terms and by 9.6%
YTD to GBP 46.50 in GBP terms, primarily reflecting the significant
appreciation in Lion Finance Group's share price.
Outstanding operational performances across our large private portfolio
companies. In 1Q26, our large private portfolio companies once again
demonstrated their position as industry-leading businesses, delivering strong
operating performance, with aggregate revenues and EBITDA increasing by 13.7%
and 26.9% y-o-y, respectively. This resulted in quarterly
aggregated net operating cash flows of GEL 55.9 million, up 29.8% y-o-y in
1Q26.
· Our retail (pharmacy) business delivered an excellent operational
performance in 1Q26. Retail revenues increased by 8.6% y-o-y, driven by a 4.5%
same-store revenue growth and an 11.0% increase in average bill size.
Performance was further supported by the launch of five new pharmacy stores
during the quarter, as well as overall economic growth. Wholesale revenues
increased by 6.7% y-o-y, primarily driven by a broader product offering across
the business' distribution channels. Together with the robust retail sales
performance, this resulted in a 20.5% y-o-y increase in EBITDA. This
performance was further supported by improved trading terms with key
suppliers, resulting in a 1.7 ppts y-o-y improvement in the 1Q26 gross profit
margin to 34.0%.
· Across our healthcare services business, a strong 13.9% y-o-y
increase in total revenue in 1Q26 reflects: a) stronger demand for outpatient
services at our large and specialty hospitals, b) a shift in the sales mix and
the impact of the bolt-on acquisition of Gormed LLC, a regional network of
three hospitals and clinics, driving growth in our regional and community
hospitals, and c) solid performance from our clinics and diagnostics business,
translating into 15.6% y-o-y EBITDA growth in 1Q26.
· Our insurance business delivered outstanding results in 1Q26,
supported by positive developments in both the P&C and medical insurance
segments. P&C insurance revenues increased by 13.4% y-o-y, driven by
growth in the credit life, property and motor insurance lines, while medical
insurance revenues increased by 37.0% y-o-y, supported by newly awarded
tenders and organic growth in the corporate portfolio, alongside a mid-teens
percentage increase in policy prices. The P&C combined ratio improved by
2.0 ppts y-o-y to 85.7%, primarily reflecting a lower loss ratio in the
corporate motor and property segments. The medical insurance combined ratio
improved by a strong 7.2 ppts y-o-y to 91.2%, driven by a lower claims
incidence, repricing and renewal of major corporate contracts on improved
terms, continued strong retail growth with new policies exhibiting lower
early-stage loss ratios, and an improvement in the expense ratio supported by
robust revenue growth. Together, these developments translated into a
remarkable 78.0% y-o-y increase in pre-tax profit for the quarter.
Lion Finance Group joined FTSE 100 Index. Following the FTSE Russell March
2026 quarterly UK Index Series review, our listed portfolio company Lion
Finance Group was promoted from the FTSE 250 to the FTSE 100 Index, becoming
the first Georgian company to be included among the 100 largest companies
listed on the London Stock Exchange. This milestone reflects the Bank's
excellent customer franchise growth, digital superiority, and consistently
strong financial and operational performance, which has materially expanded
its market capitalisation and improved share liquidity over the recent years.
The FTSE 100 inclusion marks a significant step in LFG's development,
enhancing its visibility among global institutional investors and further
reinforcing its position as a leading UK-listed financial services group
focused on the high-growth Georgian and Armenian markets.
Update on share buybacks. Reflecting our disciplined approach to returning
capital to shareholders, in 1Q26, we repurchased 475,000 shares for a total
consideration of GEL 59.8 million (US$ 22.0 million) under two buyback
programmes within our GEL 700 million capital return package: the US$ 50
million buyback and cancellation programme launched in August 2025 and
completed in January 2026, and our newly launched US$ 50 million share buyback
and cancellation programme initiated in February 2026. Since the demerger to
date, GCAP has returned a total of US$ 268 million to shareholders through the
repurchase of 16.3 million shares, representing 33.9% of the issued share
capital at its peak.
NCC ratio up 1.6 ppts to 3.9% in 1Q26. The increase primarily reflects the
launch of the new US$ 50 million share buyback and cancellation programme in
February 2026. Subsequent to 1Q26, the NCC ratio improved by 0.3 ppts to 3.6%
as of 27 April 2026, primarily reflecting the increase in total portfolio
value from the significant appreciation in Lion Finance Group's share price.
From a macroeconomic perspective, Georgia is on track to deliver another year
of solid economic performance in 2026, with average real GDP growth in the
first two months of 8.4%, underpinned by strong domestic demand and robust
external inflows. Despite the recent conflict in the Middle East region,
growth momentum has remained resilient, with March and April economic
indicators suggesting that FX inflows continue to be robust: softer tourism
receipts, resulting from the conflict, appear to have been more than offset by
stronger exports and higher incoming remittances. Inflation averaged 4.6% in
1Q26 and is expected to remain elevated in the first half of the year,
primarily reflecting geopolitical pressures driving higher global oil and food
prices, posing risk to the inflation outlook. The policy rate was maintained
at 8%, supporting macroeconomic stability amid strong demand and the
heightened external uncertainty. External and fiscal buffers remain strong,
with gross international reserves reaching a record US$ 6.3 billion and public
debt declining to 34% of GDP, its lowest level since 2014. In early 2026,
geopolitical pressures triggered a brief depreciation of the Lari, however,
this has proved short-lived so far, with the GEL subsequently stabilising and
posting a marginal YTD appreciation as of 27 April 2026. Overall, the
macroeconomic environment remains robust, with real GDP growth in 2026
expected to moderate toward its potential level. While uncertainty remains
elevated due to the conflict in the Middle East region, the current IMF
forecast stands at 5.3% for Georgia, while incoming data suggests somewhat
stronger momentum at present.
Outlook. The strong start to 2026 highlights the quality and resilience of our
defensively positioned and capital-efficient portfolio, with operational
momentum translating into tangible shareholder value through disciplined
capital returns. Supported by a stable macroeconomic environment, Georgia's
growth trajectory remains robust, with GDP per capita surpassing US$ 10,000 in
2025, more than doubling since 2020. The disciplined execution of our capital
allocation framework has translated into a significantly narrowed NAV
discount, which reached a record low of 16.2% as of 31 March 2026, compared to
the all-time high of 66.6% as of September 2022, while the discount to private
portfolio NAV 8 (#_ftn8) of 30.2% as of 31 March 2026 continues to offer an
attractive opportunity for the buybacks. Looking ahead, I am confident that
Lion Finance Group's exceptional performance in Georgia and Armenia, robust
growth across our private portfolio companies through sustained revenue and
EBITDA growth, significant deleveraging at the GCAP holding level to a net
cash position, and strong cash generation, will continue to drive consistently
robust NAV per share growth for the years to come. Together, this positions
Georgia Capital as a compelling value and growth investment opportunity with
an attractive capital return profile for shareholders.
Irakli Gilauri, Chairman and CEO
DISCUSSION OF GROUP RESULTS
The discussion below analyses the Group's unaudited net asset value at
31-Mar-26 and its income for the first quarter then ended on an IFRS basis
(see "Basis of Presentation" on page 15 below).
Net Asset Value (NAV) Statement
NAV statement summarises the Group's IFRS equity value (which we refer to as
Net Asset Value or NAV in the NAV Statement below) at the opening and closing
dates for the first quarter (31-Dec-25 and 31-Mar-26). The NAV Statement below
breaks down NAV into its components and provides a roll forward of the related
changes between the reporting periods.
NAV STATEMENT 1Q26
GEL '000, unless otherwise noted Dec-25 1. Value creation(( 9 (#_ftn9) )) 2a. 2b. 2c. Dividends 3. Operating expenses 4. Liquidity/ FX/Other Mar-26 Change
Investment and Divestments Buyback %
Listed portfolio
Lion Finance Group 2,489,286 (29,161) (42,809) - (34,195) - - 2,383,121 -4.3%
Total listed portfolio value 2,489,286 (29,161) (42,809) - (34,195) - - 2,383,121 -4.3%
Listed portfolio value change % -1.2% -1.7% 0.0% -1.4% 0.0% 0.0% -4.3%
Private portfolio companies
Large portfolio companies 2,011,844 103,678 - - (5,363) - 1,541 2,111,700 5.0%
Retail (pharmacy) 869,744 52,043 - - - - 738 922,525 6.1%
Healthcare services 613,803 6,233 - - - - 435 620,471 1.1%
Insurance 528,297 45,402 - - (5,363) - 368 568,704 7.6%
Emerging and other companies 573,755 (25,673) 1,265 - - - 415 549,762 -4.2%
Total private portfolio value 2,585,599 78,005 1,265 - (5,363) - 1,956 2,661,462 2.9%
Private portfolio value change % 3.0% 0.0% 0.0% -0.2% 0.0% 0.1% 2.9%
Total portfolio value (1) 5,074,885 48,844 (41,544) - (39,558) - 1,956 5,044,583 -0.6%
Total portfolio value change % 1.0% -0.8% 0.0% -0.8% 0.0% 0.0% -0.6%
Net cash (2) 102,909 - 41,544 (73,859) 39,558 (8,217) (5,863) 96,072 -6.6%
of which, cash and liquid funds 219,565 - 41,544 (73,859) 40,324 (8,217) (8,626) 210,731 -4.0%
of which, loans issued 2,236 - - - - - 93 2,329 4.2%
of which, accrued dividend income 20,236 - - - (766) - - 19,470 -3.8%
of which, gross debt (139,128) - - - - - 2,670 (136,458) -1.9%
Net other assets (3) 16,733 - - (2,167) - (5,131) 1,983 11,418 -31.8%
of which, share-based comp. - - - - - (5,131) 5,131 - NMF
Net asset value (1)+(2)+(3) 5,194,527 48,844 - (76,026) - (13,348) (1,924) 5,152,073 -0.8%
NAV change % 0.9% 0.0% -1.5% 0.0% -0.3% 0.0% -0.8%
Shares outstanding(9) 33,582,800 - - (589,034) - - 284,907 33,278,673 -0.9%
Net asset value per share, GEL 154.68 1.45 (0.00) 0.45 (0.00) (0.40) (1.36) 154.82 0.1%
NAV per share, GEL change % 0.9% 0.0% 0.3% 0.0% -0.3% -0.9% 0.1%
NAV per share (GEL) remained largely flat in 1Q26, up by 0.1% q-o-q. The
increase was driven by GEL 48.8 million value creation across our portfolio
companies with a positive 0.9 ppts impact and share buybacks (+0.3 ppts
impact), partially offset by a 2.0% q-o-q appreciation of GEL against GBP,
management platform-related costs and net interest expense (-1.2 ppts impact
in total). NAV per share (GBP) increased by 2.1% q-o-q in 1Q26.
Portfolio overview
Total portfolio value amounted to GEL 5.0 billion in 1Q26, down by GEL 30.3
million (down 0.6%) q-o-q:
· The value of the private portfolio increased by GEL 75.9 million
(up 2.9% q-o-q), mainly resulting from a) a GEL 78.0 million value creation;
b) investments of GEL 1.3 million, and c) a decrease of GEL 5.4 million due to
dividends paid to GCAP.
· The value of the listed portfolio decreased by GEL 106.2 million
(down 4.3% q-o-q), primarily driven by a) a GEL 42.8 million reduction
reflecting the decrease in GCAP's shareholding in the Bank, in line with the
PFIC risk management strategy, and b) the combined impact of GEL appreciation
against GBP and a largely flat share price (down 0.2% q-o-q). The decline
additionally reflects a GEL 34.2 million decrease due to the cash and buyback
dividends received.
Consequently, as of 31-Mar-26, the private portfolio value amounted to GEL 2.7
billion (52.8% of the total portfolio value), and the listed portfolio value
totalled GEL 2.4 billion (47.2% of the total portfolio value).
1) Value creation
· Value creation across our private portfolio companies amounted to
GEL 78.0 million in 1Q26, reflecting the net effect of:
o GEL 103.7 million value creation from our private large portfolio
companies, which delivered substantial growth in aggregated revenues (up 13.7%
y-o-y) and EBITDA (up 26.9% y-o-y) in 1Q26, translating into a GEL 151.3
million operating performance-related value creation, partially offset by the
negative impact of GEL 47.6 million from changes in implied valuation
multiples and FX rates.
o GEL 25.7 million value reduction from our emerging and other businesses,
primarily driven by the one-off impact from our decision to discontinue the
Zoti and Darchi pipeline projects in the renewable energy business (GEL 12
million write-down) as the projects became economically unfeasible given the
rising costs of construction and existing PPAs.
· Value reduction from the listed portfolio amounted to GEL 29.2
million in 1Q26, primarily driven by GEL appreciation against GBP and a
largely flat share price during the quarter, as described above.
As a result, the total portfolio value creation amounted to GEL 48.8 million
in 1Q26.
The table below summarises value creation drivers in our businesses in 1Q26:
Portfolio Businesses Operating Performance(( 10 (#_ftn10) )) Multiple Change Value Creation
and FX(( 11 (#_ftn11) ))
GEL '000, unless otherwise noted (1) (2) (1)+(2)
Listed portfolio (29,161)
Lion Finance Group (29,161)
Private portfolio 149,653 (71,648) 78,005
Large portfolio companies 151,322 (47,644) 103,678
Retail (pharmacy) 67,093 (15,050) 52,043
Healthcare services 9,504 (3,271) 6,233
Insurance 74,725 (29,323) 45,402
Emerging and other businesses (1,669) (24,004) (25,673)
Total portfolio 149,653 (71,648) 48,844
Valuation overview(( 12 (#_ftn12) ))
In 1Q26, our private portfolio companies were valued internally by
incorporating the portfolio companies' 1Q26 results, in line with
International Private Equity Valuation ("IPEV") guidelines and methodology
deployed at the end of 2025 by an independent valuation firm, which conducts
external valuation assessment of the retail (pharmacy), healthcare services,
insurance, renewable energy and education businesses semi-annually. The
independent valuation assessments, which serve as an input for Georgia
Capital's estimate of fair value, are performed by applying an income approach
(DCF), cross-checked with market approach (listed peer multiples and, in some
cases, precedent transactions). In line with our strategy, from time to time,
we may receive offers from interested buyers for our private portfolio
companies, which would be considered in the overall valuation assessment,
where appropriate.
We perform quarterly sensitivity analyses on our valuations. In light of
prevailing market conditions, the 1Q26 assessment indicated that a
100-basis-point change in discount rates used in the income approach for
valuing unquoted investments would result in a GEL 260 million, or 10% change
in the fair value of private equity investments.
The enterprise value (EV) and equity value development of our businesses in
1Q26 is summarised in the following table:
Enterprise Value (EV) Equity Value
GEL '000, unless otherwise noted 31-Mar-26 31-Dec-25 Change % 31-Mar-26 31-Dec-25 Change % % share in total portfolio
Listed portfolio 2,383,121 2,489,286 -4.3% 47.2%
Lion Finance Group 2,383,121 2,489,286 -4.3% 47.2%
Private portfolio 3,831,282 3,763,924 1.8% 2,661,462 2,585,599 2.9% 52.8%
Large portfolio companies 2,858,603 2,763,830 3.4% 2,111,700 2,011,844 5.0% 41.9%
Retail (pharmacy) 1,183,213 1,158,000 2.2% 922,525 869,744 6.1% 18.3%
Healthcare services 1,064,080 1,036,330 2.7% 620,471 613,803 1.1% 12.3%
Insurance 611,310 569,500 7.3% 568,704 528,297 7.6% 11.3%
Emerging and other businesses 972,679 1,000,094 -2.7% 549,762 573,755 -4.2% 10.9%
Total portfolio 5,044,583 5,074,885 -0.6% 100.0%
Private large portfolio companies (41.9% of total portfolio value)
Retail (pharmacy) (18.3% of total portfolio value) - The EV of retail
(pharmacy) increased by 2.2% to GEL 1.2 billion in 1Q26, resulting from the
strong operating performance of the business. Retail revenues increased by
8.6% y-o-y in 1Q26, reflecting successful sales initiatives that drove a 4.5%
same-store revenue growth and an 11.0% increase in average bill size. The
performance was further boosted by the addition of five new pharmacy stores in
1Q26 and continued economic growth. Wholesale revenues were up by 6.7% y-o-y
in 1Q26, driven by a broader product offering across the business'
distribution channels. Gross profit margin improved by 1.7 ppts y-o-y to 34.0%
in 1Q26, further supported by the positive outcome of improved trading terms
with key suppliers across all major categories and overall shift in the sales
mix towards a higher-margin product portfolio. Operating expenses (excl. IFRS
16) were up 10.8% y-o-y in 1Q26, primarily driven by higher salary expenses
associated with business growth. Consequently, the 1Q26 EBITDA (excl. IFRS 16)
increased by 20.5% y-o-y to GEL 29.1 million. See page 10 for details. LTM
EBITDA (incl. IFRS 16) was up 3.5% q-o-q to GEL 148.8 million in 1Q26. Net
debt (incl. IFRS 16) decreased by 9.8% to GEL 253.2 million as at 31-Mar-26,
reflecting robust cash flow generation during the quarter. As a result, the
fair value of GCAP's 98.0% holding increased by 6.1% to GEL 922.5 million in
1Q26. The implied LTM EV/EBITDA valuation multiple (incl. IFRS 16) stood at
8.0x as of 31-Mar-26 (down from 8.1x q-o-q as of 31-Dec-25 and down from 8.2x
y-o-y as of 31-Mar-25).
Healthcare services (12.3% of total portfolio value) - Healthcare services EV
increased by 2.7% to GEL 1.1 billion in 1Q26, driven by the strong underlying
operating performance throughout the business. Total revenue increased by
13.9% y-o-y in 1Q26, reflecting a) increased demand for outpatient services at
our large and specialty hospitals, b) significant improvement in sales mix,
further supported by the acquisition of Gormed LLC in December 2025, and c)
solid performance of the clinics and diagnostics business, with clinic
revenues benefitting from a growing customer base in alignment with enhanced
service offerings, while diagnostics revenue increased on the back of growth
in the retail segment. Operating expenses (excl. IFRS 16) were up by 12.3%
y-o-y in 1Q26, primarily driven by increased salary and general and
administrative expenses in line with the business expansion. This translated
into 15.6% y-o-y EBITDA (excl. IFRS 16) growth in 1Q26. See page 11 for
details. Consequently, LTM EBITDA (incl. IFRS 16) was up by 2.7% q-o-q to GEL
105.2 million in 1Q26. Net debt (incl. IFRS 16) increased by 5.4% q-o-q to GEL
405.5 million as at 31-Mar-26, reflecting the lower level of cash conversion
during the quarter, attributable to the inherent seasonality of state cash
collections. As a result, the equity value of the healthcare services business
was assessed at GEL 620.5 million in 1Q26. An implied LTM EV/EBITDA multiple
(incl. IFRS 16) remained unchanged during the quarter and stood at 10.1x at
31-Mar-26 (10.1x at 31-Dec-25 and 10.3x at 31-Mar-25).
Insurance (11.3% of total portfolio value) - The insurance business combines:
a) P&C insurance and b) medical insurance. P&C insurance revenues were
up 13.4% y-o-y to GEL 43.0 million in 1Q26, driven by growth in the credit
life, property and motor insurance lines. The revenue of the medical insurance
business increased by 37.0% y-o-y and amounted to GEL 70.6 million in 1Q26,
reflecting newly awarded tenders, organic growth in the corporate portfolio
and a mid-teens percentage increase in insurance policy prices. The combined
ratio for P&C insurance decreased by 2.0 ppts y-o-y in 1Q26, mainly
reflecting an improvement in the overall P&C loss ratio attributable to
lower loss ratio in the corporate motor and property insurance segments. The
combined ratio for medical insurance improved by 7.2 ppts y-o-y in 1Q26,
driven by a lower loss ratio, reflecting lower claims incidence against a high
base in 1Q25, repricing and renewal of major corporate contracts on improved
terms, and continued strong retail growth. As a result, the pre-tax profit of
the combined insurance business increased by 78.0% y-o-y to GEL 15.7 million
in 1Q26. See page 13 for details. LTM pre-tax income (adjusted for
non-recurring items) increased by 14.3% q-o-q to GEL 60.1 million, and the
equity value of GCAP's share in the business increased by 7.6% q-o-q to GEL
568.7 million in 1Q26. The implied LTM P/E valuation multiple stood at 9.5x as
of 31-Mar-26 (10.1x as of 31-Dec-25 and 9.8x as of 31-Mar-25).
Emerging and other businesses (10.9% of total portfolio value) - Of the
emerging and other private portfolio businesses, renewable energy, education,
wine, housing development and hospitality businesses are valued based on DCF.
Auto service business is valued based on LTM EV/EBITDA. Following the disposal
of an 80% stake in the beer and distribution business, its remaining value is
assessed using the put option valuation, reflecting GCAP's clear exit path
through a put and call structure at pre-agreed EBITDA multiples. The portfolio
value of emerging and other businesses decreased by 4.2% to GEL 549.8 million
in 1Q26, mainly reflecting the negative value creation from the one-off impact
of our resolution to discontinue selected renewable energy business's pipeline
projects, as mentioned above. See performance highlights of these businesses
on page 14.
Listed portfolio (47.2% of total portfolio value)
Lion Finance Group (47.2% of total portfolio value) - In 4Q25, Lion Finance
Group delivered an annualised ROAE of 30.1% and recorded q-o-q loan book
growth of 4.5% in Georgia and 8.5% in Armenia on a constant currency basis. In
March 2026, Lion Finance Group was promoted to the FTSE 100 Index in the UK, a
milestone achievement reflecting its scale and performance. In 1Q26, Lion
Finance Group's share price remained largely flat, down by 0.2% q-o-q to GBP
92.80. GCAP recorded buyback dividend of GEL 14.4 million from the Bank in
1Q26 and accrued GEL 19.8 million in interim dividends, subsequently received
in April 2026. During the quarter, GCAP's stake in Lion Finance Group
decreased to 16.6% from 16.9%, reflecting on-market sales of c.156,000 shares
in 1Q26 at an average price of GBP 99.00. The sales represented approximately
1.0% of LFG's average daily trading volume during 1Q26. Consequently, the
market value of GCAP's equity stake in Lion Finance Group stood at GEL 2.4
billion in 1Q26. The LTM P/E valuation multiple stood at 6.5x as of 31 March
2026 (6.7x as of 31 December 25). Lion Finance Group's public announcement of
its 1Q26 results, once published, will be available on Lion Finance Group's
website (https://lionfinancegroup.uk/results-center/quarterly-earnings/) .
2) Investments 13 (#_ftn13)
In 1Q26, GCAP invested GEL 1.3 million in the private portfolio companies.
· GEL 0.8 million was allocated to the education business.
· GEL 0.5 million was invested in the renewable energy business.
3) Share buybacks
During 1Q26, 589,034 shares were bought back for a total consideration of GEL
76.0 million.
· 475,000 shares with a total value of US$ 22.0 million (GEL 59.8
million) were bought back under GCAP's share buyback and cancellation
programmes. Subsequent to 1Q26, an additional 130,359 shares with a value of
US$ 7.0 million (GEL 19.0 million) have been repurchased.
· 114,034 shares (GEL 16.2 million in value) represent the
tax-related statutory buyback for the management trust, where the average cost
of unawarded shares is GBP 13.8 as of 31 March 2026.
4) Dividends
In 1Q26, GCAP recorded GEL 39.6 million dividend income from its portfolio
companies:
· GEL 34.2 million received from Lion Finance Group, out of which
GEL 19.8 represents the accrued interim dividend for 4Q25 (ex-dividend date in
March 2026, with payment in April 2026) and GEL 14.4 million buyback dividend
for 1Q26.
· GEL 5.4 million dividend was received from the P&C insurance
business.
Net Capital Commitment (NCC) overview
Below we describe the components of Net Capital Commitment (NCC) as of 31
March 2026 and as of 31 December 2025. NCC represents an aggregated view of
all confirmed, agreed and expected capital outflows (including a buffer for
contingencies) at both Georgia Capital PLC and JSC Georgia Capital levels.
Components of NCC 31-Mar-26 31-Dec-25 Change
GEL '000, unless otherwise noted
Total cash and liquid funds 210,731 219,565 -4.0%
Loans issued 2,329 2,236 4.2%
Accrued dividend income 19,470 20,236 -3.8%
Gross debt (136,458) (139,128) -1.9%
Net cash (1) 96,072 102,909 -6.6%
Guarantees issued (2) - - NMF
Net cash and guarantees issued (3)=(1)+(2) 96,072 102,909 -6.6%
Planned investments (4) (94,103) (95,195) -1.1%
of which, planned investments in renewable energy (57,718) (58,076) -0.6%
of which, planned investments in education (36,385) (37,119) -2.0%
Announced buybacks (5) (92,778) (15,362) NMF
Contingency/liquidity buffer (6) (107,992) (107,804) 0.2%
Total planned investments, announced buybacks and contingency/liquidity buffer (294,873) (218,361) 35.0%
(7)=(4)+(5)+(6)
Net capital commitment (3)+(7) (198,801) (115,452) 72.2%
Portfolio value 5,044,583 5,074,885 -0.6%
NCC ratio 3.9% 2.3% 1.6 ppts
Cash and liquid funds. Total cash and liquid funds' balance decreased by 4.0%
q-o-q to GEL 210.7 million in 1Q26, primarily driven by share buybacks and the
coupon payment on the remaining US$ 50 million sustainability-linked bond
during the quarter, partially offset by dividend inflows.
Loans issued. Issued loans' balance primarily refers to loans issued to our
private portfolio companies and are lent at market terms. The balance was up
by 4.2% q-o-q in 1Q26, reflecting the interest accrual on the loans issued to
our auto service business.
Accrued dividend income. As of 31 March 2026, the balance represents interim
dividends accrued from Lion Finance Group, which were subsequently received in
April 2026.
Gross debt. In US$ terms, the balance was down 2.1% q-o-q in 1Q26 (down 1.9%
in GEL terms), mainly reflecting the net impact of interest accrual and coupon
payment on GCAP's remaining US$ 50 million sustainability-linked bonds.
Planned investments. Planned investments' balance represents expected
investments in renewable energy and education businesses over the next two to
three years. The balance in US$ terms was down by 1.3% in 1Q26, reflecting
cash outflows for the investment projects, as described above.
Announced buybacks. The balance of the announced buybacks at 31-Mar-26
reflects the unutilised share buybacks under GCAP's US$ 50 million share
buyback and cancellation programme, which was launched in February 2026 under
the GEL 700 million capital-return programme.
Contingency/liquidity buffer. The balance reflects the provision for cash and
liquid assets in the amount of US$ 40 million,
for contingency/liquidity purposes. The balance remained unchanged in US$
terms as at 31 March 2026.
As a result, the NCC ratio increased by 1.6 ppts q-o-q to 3.9% as of 31 March
2026, primarily reflecting the launch of the new US$ 50 million share buyback
and cancellation programme in February 2026 and a 0.6% q-o-q decrease in the
portfolio value following the sell-down of LFG shares in line with our PFIC
risk management strategy, GEL appreciation against GBP and a largely flat
share price of Lion Finance Group during the quarter.
INCOME STATEMENT (ADJUSTED IFRS/APM)
Net income under IFRS was GEL 26.0 million in 1Q26 (GEL 330.1 million net
income in 1Q25). The IFRS income statement is prepared on the Georgia Capital
PLC level and the results of all operations of the Georgian holding company
JSC Georgia Capital are presented as one line item. As we conduct almost all
of our operations through JSC Georgia Capital, through which we hold all of
our portfolio companies, the IFRS results provide little transparency on the
underlying trends.
Accordingly, to enable a more granular analysis of those trends, the following
adjusted income statement presents the Group's results of operations for the
period ending March 31 as an aggregation of (i) the results of GCAP (the two
holding companies Georgia Capital PLC and JSC Georgia Capital, taken together)
and (ii) the fair value change in the value of portfolio companies during the
reporting period. For details on the methodology underlying the preparation of
the adjusted income statement, please refer to page 88 in Georgia Capital
PLC's 2025 Annual report.
INCOME STATEMENT (Adjusted IFRS/APM)
GEL '000, unless otherwise noted 1Q26 1Q25 Change
Dividend income 39,558 8,007 NMF
of which, regular dividend 25,130 8,007 NMF
of which, buyback dividend 14,428 - NMF
Interest income 2,522 2,791 -9.6%
Realised/unrealised (loss)/gain on liquid funds (274) 49 NMF
Interest expense (2,949) (9,104) -67.6%
Gross operating income 38,857 1,743 NMF
Operating expenses (13,348) (9,785) 36.4%
GCAP net operating income/(loss) 25,509 (8,042) NMF
Fair value changes of portfolio companies
Listed portfolio (63,356) 247,949 NMF
Lion Finance Group PLC (63,356) 247,949 NMF
Private portfolio companies 72,642 87,537 -17.0%
Large portfolio companies 98,315 128,519 -23.5%
of which, retail (pharmacy) 52,043 66,319 -21.5%
of which, healthcare services 6,233 49,191 -87.3%
of which, insurance 40,039 13,009 NMF
Emerging and other businesses (25,673) (40,982) -37.4%
Total investment return 9,286 335,486 -97.2%
Income before foreign exchange rate movements and non-recurring expenses 34,795 327,444 -89.4%
Net foreign currency (loss)/gain (3,501) 7,013 NMF
Non-recurring expenses (1,379) (258) NMF
Net income 29,915 334,199 -91.0%
Gross operating income stood at GEL 38.9 million in 1Q26, up by GEL 37.1
million y-o-y, largely reflecting a timing difference in dividend collection
following LFG's transition to quarterly dividend payments in the second half
of 2025, as well as buyback dividends received from the Bank.
The components of GCAP's operating expenses are shown in the table below:
GCAP Operating Expenses Components
GEL '000, unless otherwise noted 1Q26 1Q25 Change
Administrative expenses(( 14 (#_ftn14) )) (3,049) (2,779) 9.7%
Management expenses - cash-based(( 15 (#_ftn15) )) (5,168) (2,739) 88.7%
Management expenses - share-based(( 16 (#_ftn16) )) (5,131) (4,267) 20.2%
Total operating expenses (13,348) (9,785) 36.4%
of which, fund type expense(( 17 (#_ftn17) )) (2,319) (2,229) 4.0%
of which, management fee type expenses(( 18 (#_ftn18) )) (11,029) (7,556) 46.0%
GCAP management fee expenses starting from 2024 have a self-targeted cap of
0.75% of Georgia Capital's NAV. The LTM management fee expense ratio stood at
0.80% as of 31-Mar-26 and at 0.74% at the date of publication of the 1Q26
results (0.73% as of 31-Dec-25). The y-o-y increase in cash-based management
expenses in the quarter reflects the impact of the renewal of the Chairman and
CEO's contract and the addition of a cash-based component in a compensation.
The y-o-y increase in share-based management expenses in the quarter reflects
the impact of the higher share price, as discretionary share bonuses are
measured at the share price as of the Remuneration Committee meeting date
(usually held towards the end of the calendar year). The share price that
measures the 2025 awards was 1.6x higher than that for 2024.
Total investment return(21) represents the increase (decrease) in the fair
value of our portfolio. Total investment return was GEL 9.3 million in 1Q26,
reflecting the changes in the value of our portfolio companies. We discuss
valuation drivers for our businesses on pages 5-6. The performance of each of
our private large portfolio companies is discussed on pages 10-13.
As a result of the movements described above, GCAP's adjusted IFRS net income
amounted to GEL 29.9 million in 1Q26.
DISCUSSION OF PORTFOLIO COMPANIES' RESULTS (STAND-ALONE IFRS)
The following sections present the IFRS results and business development
extracted from the individual portfolio company's IFRS accounts, where the
1Q26 and 1Q25 portfolio company's accounts and respective IFRS numbers are
unaudited. We present key IFRS financial highlights, operating metrics and
ratios along with commentary explaining the developments behind the numbers.
For the majority of our portfolio companies, the fair value of our equity
investments is determined using an income approach (DCF), cross-checked with a
market approach (listed peer multiples and precedent transactions). Under the
discounted cash flow (DCF) valuation method, fair value is estimated by
deriving the present value of the business using reasonable assumptions of
expected future cash flows and the terminal value, and the appropriate
risk-adjusted discount rate that quantifies the risk inherent to the business.
Under the market approach, listed peer group earnings multiples are applied to
the trailing twelve months (LTM) stand-alone IFRS earnings of the relevant
business. As the income approach is the valuation driver, the stand-alone IFRS
results and developments driving the IFRS earnings of our portfolio companies
are key inputs to their valuations within GCAP's financial statements. See
"Basis of Presentation" on page 15 for more background.
Discussion of retail (pharmacy) business results
The retail (pharmacy) business, where GCAP owns a 98.0% equity interest, is
the largest pharmaceuticals retailer and wholesaler in Georgia, with a 33.7%
market share in the organised retail market based on 2024 revenues. The
business consists of a retail pharmacy chain operating under two brands (GPC
and Pharmadepot) and a wholesale business that sells pharmaceuticals and
medical supplies to hospitals and other pharmacies. The business operates a
total of 458 pharmacies (of which, 439 are in Georgia and 19 in Armenia) and
19 franchise stores (of which, 11 are in Georgia, three in Armenia and five in
Azerbaijan).
1Q26 performance (GEL '000), retail (pharmacy)(( 19 (#_ftn19) ))
INCOME STATEMENT HIGHLIGHTS 1Q26 1Q25 Change
Revenue, net 244,438 225,625 8.3%
of which, retail 207,137 190,666 8.6%
of which, wholesale 37,301 34,959 6.7%
Gross Profit 83,130 72,889 14.1%
Gross profit margin 34.0% 32.3% 1.7 ppts
Operating expenses (excl. IFRS 16) (53,993) (48,714) 10.8%
EBITDA (excl. IFRS 16) 29,137 24,175 20.5%
EBITDA margin, (excl. IFRS 16) 11.9% 10.7% 1.2 ppts
Net profit (excl. IFRS 16) 23,580 16,808 40.3%
CASH FLOW HIGHLIGHTS
Cash flow from operating activities (excl. IFRS 16) 33,216 27,809 19.4%
EBITDA to cash conversion 114.0% 115.0% -1.0 ppts
Cash flow used in investing activities 20 (#_ftn20) (2,879) (3,652) -21.2%
Free cash flow (excl. IFRS 16) 21 (#_ftn21) 30,194 23,995 25.8%
Cash flow (used in)/from financing activities (excl. IFRS 16) (12,979) 2,522 NMF
BALANCE SHEET HIGHLIGHTS 31-Mar-26 31-Dec-25 Change
Total assets 668,921 651,222 2.7%
of which, cash and bank deposits 54,471 37,177 46.5%
Total liabilities 525,910 530,773 -0.9%
of which, borrowings 148,385 157,394 -5.7%
of which, lease liabilities 154,274 155,539 -0.8%
Total equity 143,011 120,449 18.7%
INCOME STATEMENT HIGHLIGHTS
Ø The growth in the business' total revenue in 1Q26 reflects the combination
of a number of factors:
o An 8.6% y-o-y increase in retail revenues in 1Q26 was driven by strong
same-store revenue growth of 4.5% and an 11.0% y-o-y increase in average bill
size during the quarter. Retail revenue growth was further supported by the
excellent ramp-up of newly launched pharmacy stores, with 42 new stores added
in last 12 months. Favourable macroeconomic conditions and sustained economic
growth in Georgia also contributed positively to the results.
o Wholesale revenues increased by 6.7% y-o-y in 1Q26, primarily driven by a
broader product offering across the business' distribution channels.
Ø The gross profit margin improvement in 1Q26 was underpinned by improved
terms of trade with key suppliers across all major categories, as well as a
shift in the sales mix towards a higher-margin product portfolio.
Ø The y-o-y increase in operating expenses (excl. IFRS 16) in 1Q26 was mainly
driven by higher salary costs, up 17.5% y-o-y in 1Q26. This reflects increased
staff compensation aligned with market trends, the implementation of new
incentive schemes aimed at improving the gross profit margin, and the
continued growth of the business.
Ø As a result, the business achieved y-o-y EBITDA (excl. IFRS 16) growth of
20.5% in 1Q26.
Ø Net interest expense (excl. IFRS 16) was down by 13.2% y-o-y to GEL 3.4
million in 1Q26, reflecting lower average net debt balance.
Ø The developments described above translated into a GEL 6.8 million y-o-y
increase in net profit (excl. IFRS 16) in 1Q26.
CASH FLOW AND BALANCE SHEET HIGHLIGHTS
Ø The net debt balance amounted to GEL 93.9 million as at 31-Mar-26, down
21.9% from GEL 120.2 million at 31-Dec-25, reflecting robust cash flow
generation during the quarter. As a result, the net debt to EBITDA 22
(#_ftn22) leverage ratio improved to 1.0x as of 31-Mar-26 (1.3x as of
31-Dec-25).
Ø The EBITDA to cash conversion stood at 114.0% in 1Q26, reflecting strong
business performance outlined above.
OTHER VALUATION DRIVERS AND OPERATING HIGHLIGHTS
Ø In 1Q26, retail pharmacy chain expanded by 5 pharmacies, with openings
focused on strategically selected locations. The new stores were developed
using cost-efficient formats, requiring limited capital investments.
The number of pharmacies and franchise stores is provided below:
Mar-26 Dec-25 Change (q-o-q) Mar-25 Change (y-o-y)
Number of pharmacies 458 453 5 416 42
of which, Georgia 439 435 4 401 38
of which, Armenia 19 18 1 15 4
Number of franchise stores 19 19 - 19 -
of which, Georgia 11 11 - 12 (1)
of which, Armenia 3 3 - 2 1
of which, Azerbaijan 5 5 - 5 -
Ø Retail (pharmacy)'s key operating performance highlights for 1Q26 are noted
below:
Key metrics 1Q26 1Q25 Change
Same store revenue growth 4.5% 2.9% 1.6 ppts
Number of bills issued (mln) 8.5 8.6 -2.1%
Average bill size (GEL) 24.5 22.1 11.0%
Discussion of healthcare services business results
The healthcare services business, where GCAP owns 100% equity, is the largest
healthcare market participant in Georgia comprising two segments: 1) hospitals
(seven large and specialty hospitals - providing secondary and tertiary level
healthcare services across Georgia and 30 regional and community hospitals -
providing outpatient and basic inpatient services), and 2) clinics and
diagnostics (16 polyclinics - providing outpatient diagnostic and treatment
services and diagnostics - operating the largest laboratory in the entire
Caucasus region "Megalab").
1Q26 performance (GEL '000), healthcare services(( 23 (#_ftn23) ))
1Q26 1Q25 Change
INCOME STATEMENT HIGHLIGHTS
Revenue, net 24 (#_ftn24) 131,356 115,281 13.9%
Gross Profit 52,216 45,829 13.9%
Gross profit margin 39.4% 39.4% NMF
Operating expenses (excl. IFRS 16) (25,241) (22,485) 12.3%
EBITDA (excl. IFRS 16) 26,975 23,344 15.6%
EBITDA margin (excl. IFRS 16) 20.4% 20.1% 0.3 ppts
Net profit (excl. IFRS 16) 1,599 1,320 21.1%
CASH FLOW HIGHLIGHTS
Cash flow from operating activities (excl. IFRS 16) 12,114 11,697 3.6%
EBITDA to cash conversion (excl. IFRS 16) 44.9% 50.1% -5.2 ppts
Cash flow used in investing activities 25 (#_ftn25) (11,950) (11,268) 6.1%
Free cash flow (excl. IFRS 16) 26 (#_ftn26) (333) (772) -56.9%
Cash flow (used in)/from financing activities (excl. IFRS 16) (29,329) 15,251 NMF
BALANCE SHEET HIGHLIGHTS 31-Mar-26 31-Dec-25 Change
Total assets 925,034 946,386 -2.3%
of which, cash balance and bank deposits 29,744 59,081 -49.7%
Total liabilities 548,851 564,781 -2.8%
of which, borrowings 394,504 402,029 -1.9%
Total equity 376,183 381,605 -1.4%
INCOME STATEMENT HIGHLIGHTS
Ø The hospitals and clinics and diagnostics businesses represent
approximately 80% and 20%, respectively, of the consolidated revenue of the
healthcare services business.
Total revenue breakdown(( 27 (#_ftn27) )) 1Q26 1Q25 Change
Total revenue, net 131,356 115,281 13.9%
of which, large and specialty hospitals 69,341 62,284 11.3%
of which, regional and community hospitals 38,845 32,472 19.6%
of which, clinics 20,228 18,127 11.6%
of which, diagnostics 7,889 6,672 18.2%
Ø The 13.9% y-o-y increase in total revenue in 1Q26 reflects:
§ 11.3% y-o-y revenue growth at our large and specialty hospitals, primarily
driven by the increased demand for outpatient services, accounting for 38.4%
of the revenue from this group of hospitals (up 2.7 ppts y-o-y in 1Q26). This
performance was further strengthened by the continued onboarding of reputable
doctors with loyal patient bases, initiated in 2025 and sustained through the
current quarter.
§ 19.6% y-o-y revenue growth at our regional and community hospitals,
underpinned by a favourable shift in the sales mix and further supported by
the acquisition of Gormed LLC in December 2025, which contributed GEL 4.6
million to the 1Q26 y-o-y revenue growth.
§ A solid performance across the clinics and diagnostics business, with
clinics' revenues benefitting from a favourable shift in sales mix and
increased customer footprint driven by the overall service enhancements, while
diagnostics revenue increased on the back of increased demand in the retail
segment.
Ø The gross profit margin in 1Q26 remained unchanged y-o-y at 39.4%. In
addition to the revenue developments outlined above, margin performance
reflects the following trends in direct salary and materials rates 28
(#_ftn28) and utility costs:
§ The shift towards outpatient services drove cost mix changes in 1Q26,
resulting in a higher direct salary rate (up 0.6 ppts y-o-y to 38.5%),
supported by statutory minimum wage adjustments, and a lower materials rate
(down 0.5 ppts y-o-y to 15.5%), reflecting the inherently lower material
intensity of outpatient care compared to inpatient services.
§ Utilities and other expenses increased by 8.9% y-o-y in 1Q26, mainly
reflecting higher facility maintenance and utility costs following the
completion of renovation works in certain departments and the overall
expansion of the business.
Ø Operating expenses (excl. IFRS 16) increased by 12.3% in 1Q26, primarily
driven by higher salary and general and administrative expenses in line with
the business expansion.
Ø The developments described above translated into a 15.6% y-o-y increase in
EBITDA (excl. IFRS 16) in 1Q26.
Total EBITDA (excl. IFRS 16) breakdown 29 (#_ftn29) 1Q26 1Q25 Change
Total EBITDA 26,975 23,344 15.6%
of which, large and specialty hospitals 13,823 12,087 14.4%
of which, regional and community hospitals 6,445 6,030 6.9%
of which, clinics 5,099 3,954 29.0%
of which, diagnostics 1,610 1,275 26.5%
Ø Net interest expense (excl. IFRS 16) increased by 11.7% in 1Q26, mainly due
to a higher net debt balance.
CASH FLOW AND BALANCE SHEET HIGHLIGHTS
Ø Capex investment amounted to GEL 12.4 million in 1Q26 (GEL 14.6 million in
1Q25), comprising: a) development capex of GEL 6.1 million in 1Q26 (GEL 9.0
million in 1Q25) to expand service offerings and upgrade medical equipment,
and b) maintenance capex of GEL 6.3 million in 1Q26 (GEL 5.6 million in 1Q25).
Ø The EBITDA to cash conversion ratio stood at 44.9% in 1Q26. The lower level
of cash conversion during the quarter was primarily driven by the inherent
seasonality of state cash collections, with the ratio typically weaker in the
first half of the year. As delayed payments are progressively settled by the
state, cash conversion is expected to strengthen organically later in the
year.
Ø The net debt to EBITDA (excl. IFRS 16) leverage ratio remained stable at
3.7x (3.7x as at 31-Dec-25), notwithstanding the unfavourable cash collection
seasonality discussed above.
OTHER VALUATION DRIVERS AND OPERATING HIGHLIGHTS
Ø The business' key operating performance highlights for 1Q26 are noted
below:
Key metrics 1Q26 1Q25 Change
Hospitals
Number of admissions (thousands): 428.1 400.0 7.0%
of which, large and specialty hospitals 200.7 188.0 6.8%
of which, regional and community hospitals 227.4 212.0 7.3%
Occupancy rates:
of which, large and specialty hospitals 74.5% 73.8% 0.7 ppts
of which, regional and community hospitals 68.3% 76.9% -8.6 ppts
Clinics
Number of admissions (thousands): 490.2 503.4 -2.6%
Diagnostics
Number of patients served (thousands) 250 230 8.8%
Average number of tests per patient 2.9 3.0 -5.0%
Discussion of insurance business results
As at 31-Mar-26, the insurance business comprises a) property and casualty
(P&C) insurance business, operating under the brand name "Aldagi" and b)
medical insurance business, operating under "Imedi L" and "Ardi" brands, the
latter acquired in April 2024. The P&C insurance business is a leading
player with a 34% market share in property and casualty insurance based on
gross premiums as of 31-Dec-25. P&C also offers a variety of non-property
and casualty products, such as life insurance. The medical insurance business
is the country's largest private health insurer, with a 34% market share based
on gross insurance premiums as of 31-Dec-25, offering a variety of health
insurance products primarily to corporate and (selectively) to state entities
and to retail clients in Georgia. GCAP owns a 100% equity stake in both
insurance businesses.
1Q26 performance (GEL'000), insurance(( 30 (#_ftn30) ))
1Q26 1Q25 Change
INCOME STATEMENT HIGHLIGHTS 31 (#_ftn31)
Insurance revenue 113,615 89,485 27.0%
of which, P&C insurance 43,013 37,933 13.4%
of which, medical insurance 70,642 51,552 37.0%
Net underwriting profit 28,116 19,913 41.2%
Net investment profit 5,013 4,198 19.4%
Pre-tax profit 15,708 8,827 78.0%
of which, P&C insurance 9,032 7,086 27.5%
of which, medical insurance 6,676 1,741 NMF
CASH FLOW HIGHLIGHTS
Net cash flows from operating activities 10,592 3,589 NMF
Free cash flow 8,766 722 NMF
BALANCE SHEET HIGHLIGHTS 31-Mar-26 31-Dec-25 Change
Total assets 400,160 333,137 20.1%
Total equity 162,774 145,781 11.7%
INCOME STATEMENT HIGHLIGHTS
Ø The y-o-y increase in 1Q26 insurance revenue reflects a combination of the
following factors:
§ The revenue of the P&C insurance business was up by 13.4% y-o-y in
1Q26, resulting from:
o A GEL 1.8 million y-o-y increase in credit life insurance revenues in
1Q26, driven by the growth of partner banks' portfolios in the mortgage,
consumer loan, and other sectors.
o A GEL 1.2 million y-o-y increase in property insurance revenues in 1Q26,
mainly attributable to the expansion of the corporate client portfolio.
o A GEL 1.1 million y-o-y increase in motor insurance revenues in 1Q26,
mainly attributable to the expansion of the retail and corporate client
portfolios as well as up to 10% increase in corporate insurance policy prices.
§ The revenue of the medical insurance business increased by 37.0% y-o-y in
1Q26, primarily driven by newly awarded tenders and organic growth in the
corporate portfolio, supplemented by a mid-teens percentage increase in
insurance policy prices.
Ø The insurance business' key performance ratios for 1Q26 are noted below:
Key ratios P&C insurance Medical insurance
1Q26 1Q25 Change 1Q26 1Q25 Change
Combined ratio 85.7% 87.7% -2.0 ppts 91.2% 98.4% -7.2 ppts
Expense ratio 33.7% 32.9% 0.8 ppts 15.7% 17.8% -2.1 ppts
Loss ratio 52.1% 55.5% -3.4 ppts 75.5% 80.6% -5.1 ppts
FX ratio -0.1% -0.7% 0.6 ppts - - -
ROAE(( 32 (#_ftn32) )) 32.0% 28.9% 3.1 ppts 71.2% 20.5% 50.7 ppts
Ø The combined ratio of the P&C insurance business decreased by 2.0 ppts
y-o-y to 85.7% in 1Q26, primarily reflecting the impact of 3.4 ppts y-o-y
improvement in the overall P&C loss ratio attributable to lower loss ratio
in the corporate motor and property insurance segments, slightly offset by a
0.8 ppts increase in the expense ratio.
Ø The combined ratio of the medical insurance business improved by 7.2 ppts
y-o-y to 91.2% in 1Q26, reflecting the net impact of a) an improved loss ratio
(down 5.1 ppts y-o-y), driven by lower claims incidence against a high base in
1Q25, repricing and renewal of major corporate contracts on improved terms,
and continued strong retail growth - with new retail policies exhibiting lower
early-stage loss ratios, and b) a 2.1 ppts y-o-y improvement in the expense
ratio in 1Q26, driven by robust revenue growth during the quarter.
Ø Net investment profit increased by 19.4% y-o-y in 1Q26, mainly due to the
FX movements and a higher average liquid funds balance.
Ø As a result, the pre-tax profit of the insurance business was up 78.0%
y-o-y to GEL 15.7 million in 1Q26.
CASH FLOW AND BALANCE SHEET HIGHLIGHTS
Ø The solvency ratio of P&C and medical insurance businesses stood at
170% and 160%, respectively, as of 31-Mar-26, significantly above the required
minimum of 100%.
Ø The net debt to EBITDA leverage ratio stood at 0.3x as at 31-Mar-26 (0.4x
as at 31-Dec-25).
Ø The P&C insurance business distributed dividends of GEL 5.4 million to
GCAP in 1Q26.
Discussion of emerging and other portfolio results
The five businesses in our "emerging and other" private portfolio are
renewable energy, education, auto service, wine and real estate (housing
development and hospitality). They had a combined value of GEL 549.8 million
at 31-Mar-26, which represents 10.9% of our total portfolio.
1Q26 aggregated performance highlights (GEL '000), emerging and other
portfolio(( 33 (#_ftn33) ))
1Q26 1Q25 Change
Revenue 104,932 93,031 12.8%
EBITDA 22,492 20,455 10.0%
Net cash flows from operating activities 16,681 24,905 -33.0%
Ø Renewable energy | The renewable energy business operates five wholly-owned
commissioned renewable assets with an aggregate installed capacity of 71MW. In
addition, the business maintains a pipeline of wind energy projects for
potential future development (as mentioned above, two small hydro pipeline
projects were written down in 1Q26). Revenue of the business increased by
13.8% y-o-y to US$ 2.7 million in 1Q26, driven by a 13.9% y-o-y rise in
electricity generation, while the average selling price remained broadly
stable at 60.6 US$/MWh. Operating expenses were up, primarily reflecting a
lower share of salary costs eligible for capitalisation compared to 1Q25. As a
result, the business posted US$ 1.4 million EBITDA in 1Q26 (down 4.6% y-o-y).
Ø Education | Georgia Capital's education business is the largest player in
the private K-12 market in Georgia with 9.8% market share as of 31 December
2025. It currently combines majority stakes in four private school brands
operating across seven campuses, which are well-positioned in the
international, premium, midscale and affordable market segments. Revenue of
the business increased by 8.5% y-o-y to GEL 23.6 million in 1Q26, primarily
driven by organic growth through strong intakes and capacity increases.
Operating expenses were up by 7.3% y-o-y in 1Q26, mainly due to increased
salary costs, in line with the business expansion. Consequently, the business
posted GEL 8.0 million EBITDA in 1Q26 (up 10.8% y-o-y).
Ø Auto service | The auto service business includes a periodic technical
inspection (PTI) business, and a car services and parts business.
o Periodic technical inspection (PTI) business | Revenue of the business
increased by 25.8% y-o-y to GEL 6.7 million in 1Q26. The growth was driven by
a 32.3% y-o-y increase in the number of cars serviced during the quarter.
Operating expenses were up by 6.2% y-o-y in 1Q26, primarily reflecting higher
salary expenses associated with the business expansion. Consequently, the 1Q26
EBITDA increased by 38.9% y-o-y to GEL 3.5 million.
o Car services and parts business | Revenue of the business increased by
12.7% y-o-y to GEL 14.7 million in 1Q26, driven by growth in the retail,
wholesale and corporate segments. Gross profit increased by 17.6% y-o-y to GEL
4.3 million in 1Q26, reflecting strong revenue growth in the high-margin
retail segment during the quarter. Operating expenses were up 19.8% y-o-y in
1Q26, attributable to higher salary costs. As a result, the business generated
EBITDA of GEL 0.5 million in 1Q26.
Ø Wine | In 1Q26, net revenue of the business decreased by 21.6% y-o-y to GEL
7.8 million, mainly duez to a 25.8% y-o-y decrease in number of bottles sold,
which was largely attributable to regulatory changes at one core market.
Operating expenses remained largely flat, down by 0.9% y-o-y in 1Q26.
Consequently, the wine business posted negative EBITDA of GEL 0.7 million in
1Q26, down by GEL 0.7 million y-o-y.
Ø Real estate businesses | The combined revenue of the real estate business
increased by 23.5% to GEL 45.1 million in 1Q26, primarily driven by a
favourable sales mix, with a higher contribution from larger apartments, with
total area sold during the quarter up 54.1% y-o-y. Additionally, as most
projects are at finalisation stage, a higher share of revenue is being
recognised based on construction progress. Operating expenses decreased by
25.1% y-o-y in 1Q26. Consequently, the business posted EBITDA of GEL 7.4
million (up 27.9% y-o-y in 1Q26).
Basis of presentation
This announcement contains unaudited financial results presented in accordance
with UK-adopted international accounting standards ("IFRS"). The financial
results are unaudited and derived from management accounts.
Under IFRS 10, Georgia Capital PLC meets the "investment entity" definition.
For more details about the basis of preparation please refer to page 88 in
Georgia Capital PLC 2025 Annual report.
The presentation of the Income Statement (Adjusted) and some of the
information under the NAV Statement should be considered to be Alternative
Performance Measures (APM).
GLOSSARY
1. APM - Alternative Performance Measure.
2. GCAP refers to the aggregation of stand-alone Georgia Capital PLC
and stand-alone JSC Georgia Capital accounts.
3. Georgia Capital and "the Group" refer to Georgia Capital PLC and
its portfolio companies as a whole.
4. NMF - Not meaningful.
5. NAV - Net Asset Value, represents the net value of an entity and is
calculated as the total value of the entity's assets minus the total value of
its liabilities.
6. LTM - last twelve months.
7. EBITDA - Earnings before interest, taxes, non-recurring items, FX
gain/losses and depreciation and amortisation; The Group has presented these
figures in this document because management uses EBITDA as a tool to measure
the Group's operational performance and the profitability of its operations.
The Group considers EBITDA to be an important indicator of its representative
recurring operations.
8. ROIC - return on invested capital is calculated as EBITDA less
depreciation, divided by the aggregate amount of total equity and borrowed
funds.
9. Loss ratio equals net insurance claims expense divided by net
earned premiums.
10. Expense ratio in P&C insurance equals sum of acquisition costs and
operating expenses divided by net earned premiums.
11. Combined ratio equals sum of the loss ratio and the expense ratio in the
insurance business.
12. ROAE - Return on average total equity (ROAE) equals profit for the
period attributable to shareholders divided by monthly average equity
attributable to shareholders of the business for the same period.
13. Net investment - gross investments less capital returns (dividends and
sell-downs).
14. EV - enterprise value.
15. Total return/value creation - total return/value creation of each
portfolio investment is calculated as follows: we aggregate a) change in
beginning and ending fair values, b) gains from realised sales (if any) and c)
dividend income during period. We then adjust the net result to remove capital
injections (if any) to arrive at the total value creation/investment return.
16. PPA - Power purchase agreement.
17. Number of shares outstanding - Number of shares in issue less total
unawarded shares in JSC GCAP's management trust.
18. Market Value Leverage ("MVL"), also Loan to Value ("LTV") -
Interchangeably used across the document and is calculated by dividing net
debt to the total portfolio value.
19. NCC - Net Capital Commitment, represents an aggregated view of all
confirmed, agreed and expected capital outflows at both Georgia Capital PLC
and JSC Georgia Capital levels.
20. NCC Ratio - Equals Net Capital Commitment divided by portfolio value.
ABOUT GEORGIA CAPITAL PLC
Georgia Capital PLC (LSE: CGEO LN) is a platform for buying, building and
developing businesses in Georgia (together with its subsidiaries, "Georgia
Capital" or "the Group"). The Group's primary business is to develop or buy
businesses, help them institutionalise their management and grow them into
mature businesses that can further develop largely on their own, either with
continued oversight or independently. Once Georgia Capital has successfully
developed a business, the Group actively manages its portfolio to determine
each company's optimal owner. Georgia Capital will normally seek to monetise
its investment over a 5-10 year period from initial investment.
Georgia Capital currently has the following portfolio businesses: (1) a retail
(pharmacy) business, (2) a healthcare services business, (3) an insurance
business. Georgia Capital also holds other small private businesses across
different industries in Georgia, as well as a 16.6% equity stake as at
31-Mar-26 in LSE listed Lion Finance Group PLC ("Lion Finance Group" or the
"Bank"), formerly known as "Bank of Georgia Group PLC", the holding company of
leading universal banks in Georgia and Armenia.
Forward looking statements
This announcement contains forward-looking statements, including, but not
limited to, statements concerning expectations, projections, objectives,
targets, goals, strategies, future events, future revenues or performance,
capital expenditures, financing needs, plans or intentions relating to
acquisitions, competitive strengths and weaknesses, plans or goals relating to
financial position and future operations and development. Although Georgia
Capital PLC believes that the expectations and opinions reflected in such
forward-looking statements are reasonable, no assurance can be given that such
expectations and opinions will prove to have been correct. By their nature,
these forward-looking statements are subject to a number of known and unknown
risks, uncertainties and contingencies, and actual results and events could
differ materially from those currently being anticipated as reflected in such
statements. Important factors that could cause actual results to differ
materially from those expressed or implied in forward-looking statements,
certain of which are beyond our control, include, among other things: regional
instability; currency fluctuations and risk, including depreciation of the
Georgian Lari, and macroeconomic risk, regulatory risk across a wide range of
industries; investment risk; liquidity risk; portfolio company strategic and
execution risks and other key factors that could adversely affect our business
and financial performance, which are contained elsewhere in this document and
in our past and future filings and reports and also the 'Principal Risks and
Uncertainties' included in Georgia Capital PLC's Annual Report and Accounts
2025. No part of this document constitutes, or shall be taken to constitute,
an invitation or inducement to invest in Georgia Capital PLC or any other
entity and must not be relied upon in any way in connection with any
investment decision. Georgia Capital PLC and other entities undertake no
obligation to update any forward-looking statements, whether as a result of
new information, future events or otherwise, except to the extent legally
required. Nothing in this document should be construed as a profit forecast.
COMPANY INFORMATION
Georgia Capital PLC
Registered Address
19(th) Floor
51 Lime Street
London, EC3M 7DQ
United Kingdom
www.georgiacapital.ge (http://www.georgiacapital.ge)
Registered under number 10852406 in England and Wales
Stock Listing
London Stock Exchange PLC's Main Market for listed securities
Ticker: "CGEO LN"
Contact Information
Georgia Capital PLC Investor Relations
Telephone: +44 (0) 203 178 4034; +995 322 000000
E-mail: ir@gcap.ge (mailto:ir@gcap.ge)
Auditors
PricewaterhouseCoopers LLP ("PwC")
7 More London Riverside,
London SE1 2RT,
United Kingdom
Registrar
Computershare Investor Services PLC
The Pavilions
Bridgewater Road
Bristol BS13 8AE
United Kingdom
Please note that Investor Centre is a free, secure online service run by our
Registrar, Computershare,
giving you convenient access to information on your shareholdings.
Investor Centre Web Address - www.investorcentre.co.uk
(http://www.investorcentre.co.uk) .
Investor Centre Shareholder Helpline: +44 (0) 370 873 5866
Share price information
Shareholders can access both the latest and historical prices via the website
www.georgiacapital.ge (http://www.georgiacapital.ge)
1 (#_ftnref1) See "Basis of Presentation" for more background on page 15.
Private portfolio companies' performance includes aggregated stand-alone IFRS
results for our portfolio companies, which can be viewed as APMs for Georgia
Capital, since Georgia Capital does not consolidate its subsidiaries and
instead measures them at fair value under IFRS.
2 (#_ftnref2) Please see definition in glossary on page 15.
(( 3 (#_ftnref3) )) The March 2026 and December 2025 figures both include
accrued dividend income from Lion Finance Group PLC.
4 (#_ftnref4) Includes both the buybacks under the share buyback and
cancellation programme and for the management trust.
5 (#_ftnref5) Includes both cash and buyback dividends.
(( 6 (#_ftnref6) )) The results of our five businesses included in the
emerging and other portfolio (described on page 14) are not broken out
separately. Performance totals, however, include the emerging and other
portfolio companies' results.
(( 7 (#_ftnref7) )) Determined by taking into account the peak number of 47.9
million shares issued as of 31-Dec-20.
(( 8 (#_ftnref8) )) Calculated using GCAP's and LFG's trading prices as of 31
March 2026 and assuming allocation of net cash to the private portfolio.
9 (#_ftnref9) Please see definition in glossary on page 15.
10 (#_ftnref10) Change in the fair value attributable to the change in
actual or expected earnings of the business, as well as the change in net
debt.
11 (#_ftnref11) Change in the fair value attributable to the change in
valuation multiples and the effect of exchange rate movement on net debt.
12 (#_ftnref12) Please read more about valuation methodology on page 15 in
"Basis of presentation".
13 (#_ftnref13) Investments are made at JSC Georgia Capital level, the
Georgian holding company.
14 (#_ftnref14) Includes expenses such as external audit fees, legal
counsel, corporate secretary and other similar administrative costs.
15 (#_ftnref15) Cash-based management expenses are cash salary and cash
bonuses paid/accrued for staff and management compensation.
16 (#_ftnref16) Share-based management expenses are share salary and share
bonus expenses of management and staff.
17 (#_ftnref17) Fund type expenses include expenses such as audit and
valuation fees, fees for legal advisors, Board compensation and corporate
secretary costs.
18 (#_ftnref18) Management fee is the sum of cash-based and share-based
operating expenses (excluding fund-type costs).
19 (#_ftnref19) The detailed IFRS financial statements are included in
supplementary excel file, available at
https://georgiacapital.ge/ir/financial-results
(https://georgiacapital.ge/ir/financial-results) . In 2026, revenue generated
under state-funded programmes and sold through retail channels has been
reclassified from wholesale to retail revenue, considering that retail serves
as the distribution channel for such sales. Comparative periods and respective
operating data have been restated accordingly.
20 (#_ftnref20) Of which - cash outflow on capex of GEL 3.1 million in 1Q26
(GEL 4.6 million in 1Q25); proceeds from sale of assets GEL 0.1 million in
1Q26 (GEL 0.8 million in 1Q25).
21 (#_ftnref21) Calculated by deducting capex and minority acquisition from
operating cash flows and adding proceeds from the sale of PPE/IP.
22 (#_ftnref22) Figures take into account the application of the minority
buyout agreement.
23 (#_ftnref23) The detailed IFRS financial statements are included in
supplementary excel file, available at
https://georgiacapital.ge/ir/financial-results
(https://georgiacapital.ge/ir/financial-results) .
24 (#_ftnref24) Net revenue - Gross revenue less corrections and rebates.
Margins are calculated from gross revenue.
25 (#_ftnref25) Of which - capex of GEL 12.4 million in 1Q26 (GEL 14.6
million in 1Q25); no proceeds from the sale of property in 1Q26 (GEL 2.2
million in 1Q25).
26 (#_ftnref26) Operating cash flows less capex, plus net proceeds from the
sale of assets.
(( 27 (#_ftnref27) )) Total figures take into account inter-business and
inter-segment eliminations and therefore do not equal the sum of the presented
components.
28 (#_ftnref28) The respective costs divided by gross revenues.
29 (#_ftnref29) Total figures take into account inter-business and
inter-segment eliminations and therefore do not equal the sum of the presented
components.
30 (#_ftnref30) The detailed IFRS financial statements are included in
supplementary excel file, available at
https://georgiacapital.ge/ir/financial-results
(https://georgiacapital.ge/ir/financial-results) .
(( 31 (#_ftnref31) )) Total 2026 figures take into account inter-business
eliminations and therefore do not equal the sum of the presented components.
32 (#_ftnref32) Calculated based on average equity, adjusted for preferred
shares.
33 (#_ftnref33) Emerging and other portfolio companies' performance
highlights are presented excluding the beer and distribution business, where
GCAP has a 20% minority holding. Aggregated numbers are presented
like-for-like basis.
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