REG-ICG Enterprise Trust Plc : Statement re Quarterly Update for the Quarter to 30 April 2018

ICG Enterprise TrustAnnouncement

18/06/2018 13:05

  
Quarterly Update
For the three months to 30 April 2018
  
  
 
Highlights
 
 
 
NAV per share of 970p; a total return of 1.6% over the quarter
 
 
 
Continued strong exit activity; realisations at significant uplifts to carrying value and cost
 
 
 
£64.6m of new commitments and selective deployment into compelling investment opportunities
 
 
 
Quarterly dividend of 5.0p declared - to be paid in September 2018 
 
 
 
NAV and share price continue to outperform FTSE All-Share over one, three, five and 10 years
 
 
  
Realisations and IPOs the key driver of growth 
 
 
 
Investment portfolio valued at £611.8m[1], 91.1% of net assets
 
 
 
 
 
2.3% return for the quarter; 1.7% on a constant currency basis
 
 
 
 
 
Portfolio continues to be highly cash generative 
 
 
 
 
 
16 full realisations in the quarter; £25.2m of realisation proceeds
 
 
 
Realisations at a 31% uplift[2] to carrying value; 2.2x multiple of cost
 
 
 
 
 
Continued exit activity since the quarter end
 
 
 
 
 
A further £24.2m of proceeds received in May 2018
 
 
 
£10.7m from the sale of The Laine Pub Company; a 2.0x multiple to cost
 
 
 
Year to date, realisations continue to outweigh new investments[3]
 
 
  
New commitments and selective investment into compelling opportunities
 
 
 
£64.6m of new primary commitments 
 
 
 
 
 
€40m (£34.6m) to ICG Europe Fund VII
 
 
 
Flexible strategy targeting gross annualised returns of 15-20% with low downside risk
 
 
 
Investing in European companies with experienced management, typically in non-cyclical industries
 
 
 
 
 
£30m to Graphite IX
 
 
 
Focus on mid-market buyouts in the UK 
 
 
 
Companies valued at between £30 million and £150 million 
 
 
 
 
 
 
 
 
£22.3m of new investment - 47% deployed into high conviction investments
 
 
 
 
 
Focus remains on defensive growth, structural downside protection and relative value
 
 
 
High conviction investments (ICG directly controlled investments, third-party co-investments and secondary investments) increased to 43% of investment portfolio
 
 
 
 
 
£7.1m co-investment completed in Endeavor Schools, a school operator based in the USA, alongside Leeds Equity Partners 
 
 
 
 
 
Defensive business with strong underlying growth trends and stable cash flows
 
 
 
 
 
£5.1m invested since the quarter end
 
 
 
 
 
Strong pipeline of co-investments and new funds
 
 
  
Dividend
-  Final dividend of 6p to be paid on 13 July 2018[4]
- Quarterly dividend of 5.0p declared 
-     Will be paid on 7 September 2018 for shareholders on the register on 17 August 2018 
     
Strong balance sheet 
- Closing net asset value of £672m
-  Cash balance of £74.8m at 30 April 2018
- Uncalled commitments of £376.3m
-     £179.0m total liquidity (including £104.2m undrawn bank line)
      
Consistent strong performance 
 
The performance of the Company remains strong over the short, medium and long term, with the NAV and share price outperforming the FTSE All-Share Index over one, three, five and 10 years.
                                           
 Performance to 30 April 2018 
 3 months 
 1 year 
 3 years 
 5 years 
 10* years 
   
 Net asset value per share 
 +1.6% 
 +13.7% 
 +49.8% 
 +69.5% 
 +108.5% 
   
 Share price 
 +5.0% 
 +19.4% 
 +62.1% 
 +97.2% 
 +134.6% 
   
 FTSE All-Share Index 
 +1.1% 
 +8.2% 
 +22.5% 
 +45.6% 
 +102.8% 
   
  
  
 
 * As the Company changed its year end in 2010, the ten-year figures are for the 121 month period to 30 April 2018.

  

  

  
Emma Osborne, Head of Private Equity Fund Investments, ICG, commented:
 
 "The portfolio continues to perform well, and we are pleased with the progress made in a quarter in which managers tend not to revalue the unrealised investments significantly.  The portfolio remains highly cash generative as our managers continue to take advantage of the strong exit environment to sell portfolio companies. Against this, we are redeploying capital selectively into high quality defensive businesses and in special situations where we can achieve relative value. We have a strong pipeline of new opportunities and the portfolio is well positioned to continue to generate shareholder value."

  
 
 
  

  
Enquiries
 
 
Analyst / Investor enquiries:  +44 (0) 20 3201 7700
 Emma Osborne, Head of Private Equity Fund Investments, ICG  
 Nikki Edgar, Finance and Investor Relations, ICG  

  

 Media:
Helen Gustard, Co-Head of Corporate Communications, ICG  +44 (0) 20 3201 7917
Alicia Wyllie, Co-Head of Corporate Communications, ICG
Vikki Kosmalska, Associate Partner, Maitland    +44 (0) 20 7379 5151

     
 
 
Disclaimer
  This report may contain forward looking statements. These statements have been made by the Directors in good faith based on the information available to them up to the time of their approval of this report and should be treated with caution due to the inherent uncertainties, including both economic and business risk factors, underlying such forward-looking information. These written materials are not an offer of securities for sale in the United States. Securities may not be offered or sold in the United States absent registration under the US Securities Act of 1933, as amended, or an exemption therefrom. The issuer has not and does not intend to register any securities under the US Securities Act of 1933, as amended, and does not intend to offer any securities to the public in the United States. No money, securities or other consideration from any person inside the United States is being solicited and, if sent in response to the information contained in these written materials, will not be accepted. This report contains information which, prior to this announcement, was inside information.  
 
 
   
Supplementary information
 
The 30 largest underlying investments
 
The table below presents the 30 companies in which ICG Enterprise had the largest investments by value at 30 April 2018. These investments may be held directly or through funds, or in some cases in both ways. The valuations are gross and are shown as a percentage of the total investment Portfolio. 
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
 
 Company 
 Manager 
 Year of investment 
 Country 
 Value as a % of Portfolio 
 1 
 City & County Healthcare Group 
 
 
 
 
 
 Provider of home care services 
 Graphite Capital 
 2013 
 UK 
 3.4% 
 2 
 DomusVi+ 
 
 
 
 
 
 Operator of retirement homes 
 ICG 
 2017 
 France 
 2.9% 
 3 
 Visma+ 
 
 
 
 
 
 Provider of accounting software and accounting outsourcing services 
 ICG & Cinven 
 2014 & 2017 
 Europe 
 2.5% 
 4 
 David Lloyd Leisure+ 
 
 
 
 
 
 Operator of premium health clubs 
 TDR Capital 
 2013 
 UK 
 2.3% 
 5 
 Education Personnel+^ 
 
 
 
 
 
 Provider of temporary staff for the education sector 
 ICG 
 2014 
 UK 
 2.2% 
 6 
 Roompot+ 
 
 
 
 
 
 Operator and developer of holiday parks 
 PAI Partners 
 2016 
 Netherlands 
 2.0% 
 7 
 nGAGE 
 
 
 
 
 
 Provider of recruitment services 
 Graphite Capital 
 2014 
 UK 
 2.0% 
 8 
 Gerflor^ 
 
 
 
 
 
 Manufacturer of vinyl flooring 
 ICG 
 2011 
 France 
 2.0% 
 9 
 PetSmart+ 
 
 
 
 
 
 Retailer of pet products and services 
 BC Partners 
 2015 
 USA 
 1.8% 
 10 
 Ceridian+ 
 
 
 
 
 
 Provider of payment processing services 
 Thomas H Lee Partners 
 2007 
 USA 
 1.8% 
 11 
 The Laine Pub Company+ 
 
 
 
 
 
 Operator of pubs and bars 
 Graphite Capital 
 2014 
 UK 
 1.8% 
 12 
 ICR Group 
 
 
 
 
 
 Provider of repair and maintenance services to the energy industry 
 Graphite Capital 
 2014 
 UK 
 1.7% 
 13 
 Froneri+^ 
 
 
 
 
 
 Manufacturer and distributor of ice cream products 
 PAI Partners 
 2013 
 UK 
 1.6% 
 14 
 Cambium^ 
 
 
 
 
 
 Provider of educational solutions and services 
 ICG 
 2016 
 USA 
 1.6% 
 15 
 System One+ 
 
 
 
 
 
 Provider of specialty workforce solutions 
 Thomas H Lee Partners 
 2016 
 USA 
 1.6%

  

  

   
 
 Company 
 Manager 
 Year of investment 
 Country 
 Value as a % of Portfolio 
 16 
 Beck & Pollitzer 
 
 
 
 
 
 Provider of industrial machinery installation and relocation 
 Graphite Capital 
 2016 
 UK 
 1.6% 
 17 
 Skillsoft+ 
 
 
 
 
 
 Provider of off the shelf e-learning content 
 Charterhouse 
 2014 
 USA 
 1.5% 
 18 
 Frontier Medical+ 
 
 
 
 
 
 Manufacturer of medical devices 
 Kester Capital 
 2013 
 UK 
 1.5% 
 19 
 TMF^ 
 
 
 
 
 
 Provider of management and accounting outsourcing services 
 Doughty Hanson 
 2008 
 Netherlands 
 1.5% 
 20 
 Yudo+ 
 
 
 
 
 
 Designer and manufacturer of hot runner systems 
 ICG 
 2018 
 South Korea 
 1.4% 
 21 
 Endeavor Schools+ 
 
 
 
 
 
 Operator of schools 
 Leeds Equity Partners 
 2018 
 USA 
 1.2% 
 22 
 YSC 
 
 
 
 
 
 Provider of leadership consulting and management assessment services 
 Graphite Capital 
 2017 
 UK 
 1.1% 
 23 
 Swiss Education+ 
 
 
 
 
 
 Provider of hospitality training 
 Invision Capital 
 2015 
 Switzerland 
 1.1% 
 24 
 New World Trading Company 
 
 
 
 
 
 Operator of distinctive pub restaurants 
 Graphite Capital 
 2016 
 UK 
 1.1% 
 25 
 U-POL^ 
 
 
 
 
 
 Manufacturer and distributor of automotive refinishing products 
 Graphite Capital 
 2010 
 UK 
 1.0% 
 26 
 Cognito+ 
 
 
 
 
 
 Supplier of communications equipment, software & services 
 Graphite Capital 
 2002 
 UK 
 0.9% 
 27 
 Compass Community 
 
 
 
 
 
 Provider of fostering services and children residential care 
 Graphite Capital 
 2017 
 UK 
 0.9% 
 28 
 Random42 
 
 
 
 
 
 Provider of high-quality medical animation and digital media services to the healthcare and pharmaceutical industry 
 Graphite Capital 
 2017 
 UK 
 0.8% 
 29 
 Intervias 
 
 
 
 
 
 Operator of petrol station forecourts 
 TDR Capital 
 2014 
 UK 
 0.7% 
 30 
 Odgers+ 
 
 
 
 
 
 Provider of recruitment services 
 Graphite Capital 
 2009 
 UK 
 0.6% 
 
 Total of the 30 largest underlying investments 
   
   
 48.1% 
 
 
 
 
 
 
 
 + All or part of this investment is held directly as a co-investment or other direct investment. 
 
 
 ^ All or part of this investment was acquired as part of a secondary purchase. 
   
The 30 largest fund investments
 
The 30 largest funds by value 30 April 2018 are: 
                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
 
 Fund 
 Year of commitment 
 Country/ region 
 Value £m 
 Outstanding commitment £m 
 1 
 Graphite Capital Partners VIII * 
 
 
 
 
 Mid-market buy-outs 
 2013 
 UK 
 74.3 
 26.6 
 2 
 ICG Europe VI ** 
 
 
 
 
 
 Mezzanine and equity in mid-market buy-outs 
 2015 
  Europe  
 24.0 
 2.3 
 3 
 BC European Capital IX ** 
 
 
 
 
 
 Large buy-outs 
 2011 
 Europe/USA 
 19.5 
 0.8 
 4 
 CVC European Equity Partners VI 
 
 
 
 
 Large buy-outs 
 2013 
 Europe/USA 
 14.9 
 2.2 
 5 
 CVC European Equity Partners V ** 
 
 
 
 
 Large buy-outs 
 2008 
 Europe/USA 
 12.8 
 0.4 
 6 
 Graphite Capital Partners VII * / ** 
 
 
 
 
 Mid-market buy-outs 
 2007 
  UK  
 12.6 
 4.7 
 7 
 One Equity Partners VI 
 
 
 
 
 
 Mid-market buy-outs 
 2016 
  USA/Western Europe  
 12.3 
 1.0 
 8 
 Fifth Cinven Fund 
 
 
 
 
 
 Large buy-outs 
 2012 
  Europe  
 12.1 
 1.2 
 9 
 Thomas H Lee Equity Fund VII 
 
 
 
 
 
 Mid-market and large buy-outs 
 2015 
  USA  
 12.0 
 4.5 
 10 
 ICG Strategic Secondaries Fund II 
 
 
 
 
 Secondary fund restructurings 
 2016 
 Europe/USA 
 11.2 
 18.8 
 11 
 ICG Velocity Partners Co-Investor ** 
 
 
 
 
 Mid-market buy-outs 
 2016 
  USA  
 10.7 
 1.0 
 12 
 Permira V 
 
 
 
 
 
 Large buy-outs 
 2013 
 Europe/USA 
 10.1 
 0.6 
 13 
 Activa Capital Fund III 
 
 
 
 
 
 Mid-market buy-outs 
 2013 
  France  
 10.1 
 3.8 
 14 
 TDR Capital III 
 
 
 
 
 
 Mid-market and large buy-outs 
 2013 
  Europe  
 9.6 
 3.1 
 15 
 PAI Europe VI 
 
 
 
 
 
 Mid-market and large buy-outs 
 2013 
  Europe  
 9.5 
 6.7 
 16 
 Nordic Capital Partners VIII 
 
 
 
 
 
 Mid-market and large buy-outs 
 2013 
 Europe 
 9.2 
 1.6 
 17 
 Thomas H Lee Parallel Fund VI 
 
 
 
 
 Large buy-outs 
 2007 
  USA  
 8.7 
 1.0 
 18 
 Doughty Hanson & Co V ** 
 
 
 
 
 
 Mid-market and large buy-outs 
 2006 
  Europe  
 8.7 
 6.7 
 19 
 IK VII 
 
 
 
 
 
 Mid-market buy-outs 
 2013 
  Europe  
 8.3 
 0.4 
 20 
 Hollyport Secondary Opportunities V 
 
 
 
 
 Tail-end secondary portfolios

  

  

  

  

  

  

   
 2015 
 Europe/USA 
 8.1 
 2.3

  

  

   
 
 Fund 
 Year of commitment 
 Country/ region 
 Value £m 
 Outstanding commitment £m 
 21 
 ICG Europe V ** 
 
 
 
 
 
 Mezzanine and equity in mid-market buy-outs 
 2012 
  Europe  
 7.9 
 0.8 
 22 
 Deutsche Beteiligungs Fund VI 
 
 
 
 
 Mid-market buy-outs 
 2012 
  Germany  
 7.4 
 1.2 
 23 
 Bowmark Capital Partners IV 
 
 
 
 
 
 Mid-market buy-outs 
 2007 
  UK  
 6.8 
 0 
 24 
 Egeria Private Equity Fund IV 
 
 
 
 
 
 Mid-market buy-outs 
 2012 
 Netherlands 
 6.6 
 1.6 
 25 
 Graphite Capital Partners VI ** 
 
 
 
 
 
 Mid-market buy-outs 
 2003 
  UK  
 6.3 
 0.0 
 26 
 ICG European Fund 2006 B** 
 
 
 
 
 
 Mezzanine and equity in mid-market buy-outs 
 2014 
  Europe  
 6.2 
 2.1 
 27 
 Advent Global Private Equity VIII 
 
 
 
 
 Large buy-outs 
 2016 
 Europe/USA 
 6.1 
 6.7 
 28 
 ICG Asia Pacific Fund III 
 
 
 
 
 
 Mezzanine 
 2016 
  Asia Pacific  
 6.1 
 5.6 
 29 
 Gridiron Capital Fund III 
 
 
 
 
 
 Mid-market buy-outs 
 2016 
   North America   
 5.9 
 5.6 
 30 
 Activa Capital Fund II 
 
 
 
 
 
 Mid-market buy-outs 
 2007 
  France  
 5.0 
 1.9 
 
 Total of the largest 30 fund investments 
   
 363.0 
 115.2 
 
 Percentage of total investment Portfolio 
   
 59.3% 
   
 
 * Includes the associated Top Up funds. 
 
 
 
 
 ** All or part of an interest acquired through a secondary fund purchase. 
 
 
    
Portfolio analysis1
                                     
 Investment category 
 % of portfolio 
 High conviction portfolio
ICG  
  

 18.1% 
 Third party co-investments 
 19.1% 
 Third party secondary investments 
 6.0% 
 Total High Conviction investments 
 43.2%

   
 Third party funds' portfolio
Graphite Capital primary funds    
  

 14.6% 
 Third party primary funds
Total diversified fund investments  
 42.2%
56.8%  
 Total 
 100.0% 
 
                                                                                                                            
 Portfolio by investment type 
   
 % of value of underlying investments 
 Large buyouts 
 
 42.4% 
 Mid-market buyouts 
 
 48.1% 
 Small buyouts 
   
 7.9% 
 Other 
   
 1.6% 
 Total 
   
 100.0% 
  

 Portfolio by calendar year of investment 
   
  

 % of value of underlying investments 
 2018 
   
   
 4.8% 
 2017 
   
   
 19.5% 
 2016 
   
   
 20.5% 
 2015 
   
   
 12.3% 
 2014 
   
   
 17.1% 
 2013 
   
   
 11.8% 
 2012 
   
   
 3.1% 
 2011 
   
   
 2.0% 
 2010 
   
   
 2.1% 
 2009 
   
   
 1.2% 
 2008 
   
   
 1.8% 
 2007 
   
   
 2.0% 
 2006 and before 
   
   
 1.8% 
 Total 
   
   
 100.0% 
 
                                                      
 Portfolio by sector 
   
 % of value of underlying investments 
 Healthcare and education 
 
 21.8% 
 Industrials 
 
 16.7% 
 Business services  
 
 15.9% 
 Consumer goods and services 
 
 15.2% 
 Leisure 
 
 12.6% 
 TMT 
 
 10.2% 
 Financials 
 
 4.9% 
 Other 
 
 2.7% 
 Total 
   
 100.0% 
 
                                  
  

 Portfolio by geographic distribution based on location of Company headquarters 
 
  

 % of value of underlying investments 
 UK 
 
 35.3% 
 North America 
   
 23.0% 
 Europe 
 
 38.7% 
 Rest of world 
 
 3.0% 
 Total 
   
 100.0% 
  
Footnote
 
 
 
All balance sheet data is presented on a look-through basis to the investment portfolio held by the Company, which is consistent with the commentary in previous annual and interim reports.
 
 
  
Balance sheet information
  
The summary balance sheet at 30 April 2018 is set out below.
                                             
   
 30 April 2018 
 % of net assets 
 31 January 2018 
 % of net assets 
   
 £m 
 £m 
 Total portfolio 
 611.8 
 91.1% 
 600.7 
 90.4% 
 Cash and liquid assets 
 74.8 
 11.1% 
 78.4 
 11.8% 
 Other net current liabilities 
 (14.8) 
 (2.2%) 
 (14.8) 
 (2.2)% 
 Net assets 
 671.8 
 100.0% 
 664.3 
 100.0% 
 
                                                     
 Movement in liquid assets 
 
 £m 
 3 months 
30 April 18  
 Additions2 
   (22.9) 
 Cash proceeds generated by the portfolio (including income) 
   25.2  
 Net cash generated by the investment portfolio 
   2.3  
 Non-investment cash flows 
   (2.6) 
 Effect of changes in foreign exchange rates 
   0.2  
 Cash inflow before shareholder distributions 
   (0.1)  
 Dividends paid to shareholders 
   (3.5) 
 Net cash movement 
   (3.6) 
 Opening cash and liquid assets 
   78.4  
 Closing cash and liquid assets 
   74.8  
   
Footnote
 
 
 
Additions cash figure for quarter to 30 April includes £0.6m of drawdowns paid which were accrued at the prior quarter end.
 
 
                                                            
 Uncalled commitment coverage 
   
   
   
 30 April 
2018  
 31 January 2018 
   
 £m 
 £m 
 Cash and liquid assets 
 74.8 
 78.4 
 Undrawn bank facility  
 104.2 
 104.0 
 Total liquidity 
 179.0 
 182.4 
   
   
   
 Outstanding commitments 
 376.3 
 321.2 
 Less: Total liquidity 
 (179.0) 
 (182.4) 
 Over-commitment 
 197.3 
 138.8 
 Over-commitment as % of net assets 
 29.4% 
 20.9% 
 
 

 
 
[1] 49% of the Portfolio is valued using 31 March 2018 (or later) valuations.
 
 
 
[2] Uplift figure excludes publically listed companies that were exited via sell downs of their shares
 
 
 
[3] At 31 May 2018
 
 
 
[4] To shareholders on the register on 22 June 2018
 
 
 


This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: ICG Enterprise Trust Plc via Globenewswire