RCS - HgCapital Trust PLC - Edison issues update on HgCapital Trust (HGT)

HgCapital TrustAnnouncement

13/09/2022 08:00

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RNS Number : 1541Z  HgCapital Trust PLC  13 September 2022

London, UK, 13 September 2022

 

Edison issues update on HgCapital Trust (HGT)

HgCapital Trust (HGT) consistently executes its successful active ownership
strategy, undeterred by the turbulent macroeconomic conditions. It has
invested a net amount of c £332m ytd (16% of opening NAV) in announced deals
(closed and to be closed), all in the manager's core areas of software and
services expertise. Moreover, HGT should receive net proceeds of c £180m from
exits and refinancings announced so far this year (with more exits in the
near-term pipeline). HGT posted a 1.8% NAV per share total return (TR) in H122
and a one-year NAV TR of 20.6% (22.2% per year over the last five years).
HGT's discount to end-June 2022 NAV is now c 17%, while it has traded much
closer to NAV in recent years.

HGT's slightly positive NAV TR in H122 of 1.8% (2.7% ytd to end-August 2022)
was driven by continued strong portfolio performance with last 12-month
revenue and EBITDA for its top 20 holdings up 31% and 26% y-o-y, respectively.
This is in line with the 2017-2021 average EBITDA growth of 28% per year, of
which c 10-15% is normally organic. We believe that despite the weaker global
economy, the earnings outlook for tech and services companies with a
mission-critical, low-spend offering (such as HGT's holdings) remains
favourable as corporate customers seek to improve business flexibility and
cost efficiency. In July 2022, Gartner forecast global software and IT
services spending to increase by 9.6% and 6.2% in 2022, respectively (followed
by 11.8% and 8.3% in 2023).

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About Edison: Edison is a leading research and investor relations consultancy,
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focusing on the volume and quality of investors reached - across institutions,
family offices, wealth managers and retail investors - Edison can create and
gauge intent to purchase, even in the darkest pools of capital, and then make
introductions via non-deal roadshows, events or virtual meetings.

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For more information, please contact Edison:

Milosz Papst +44 (0)20 3077 5720 investmenttrusts@edisongroup.com
(mailto:investmenttrusts@edisongroup.com)

Richard Williamson +44 (0)20 3077 5720 investmenttrusts@edisongroup.com
(mailto:investmenttrusts@edisongroup.com)

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