TIDMICGT
ICG Enterprise Trust plc
12 May 2022
Preliminary Results for the twelve months ended 31 January
2022
Defensive growth; long-term value
Highlights
-- NAV of GBP1.2bn, equal to NAV per Share of 1,690p (31
January 2021: 1,384p)
-- NAV per Share Total Return of 24.4% in the year
(FY21: 22.5%)
-- Portfolio delivering strong performance: Portfolio
Return on a Local Currency Basis of 29.4% (Sterling
return 27.6%)
-- Realisation Proceeds of GBP333.5m, including
GBP210.5m from 54 Full Exits at an average Uplift To
Carrying Value of 36.3%
-- Executed on an attractive investment pipeline:
GBP303.7m of investments in the year, 61.1% into High
Conviction Investments
-- Fourth quarter dividend of 9p per share brings full
year dividend to 27p, an increase of 12.5% on FY21
-- Focus on investing in companies with defensive growth
characteristics positions ICG Enterprise Trust well
to navigate uncertain market conditions
Oliver Gardey
Head of Private Equity Fund Investments, ICG
This has been a very successful year for ICG Enterprise
Trust, generating significant value and making attractive
new investments. At 31 January 2022, the NAV per Share
stood at 1,690p, representing NAV per Share Total
Return of 24.4% for the year.
We have extended our track record of delivering strong
growth in our Portfolio, generating a 29.4% Portfolio
Return on a Local Currency Basis over the Last Twelve
Months. This represents our 13(th) consecutive year
of double-digit growth. These returns reflect strong
underlying performance of our investments, as well
as our continued track record of realising assets
at a significant Uplift To Carrying Value.
We and our managers continued to identify attractive
opportunities to make new investments. During the
year we invested GBP304m and made new primary Commitments
to funds totalling GBP190m. During periods of elevated
transaction activity, as we saw over the last year,
selection and judgement are even more crucial. I am
proud of the dedicated team within ICG Enterprise
Trust, who maintained a disciplined approach to constructing
a portfolio for defensive growth.
We are well-positioned to navigate periods of uncertainty,
with a diversified Portfolio that reflects our focus
on buyouts of high quality, cash generative companies
that have attractive market positions and robust levers
for growth.
PERFORMANCE OVERVIEW
Annualised
------------ -------- -------- --------- --------------------------------
Performance
to 31
January
2022 3 months 6 months 1 year 3 years 5 years 10 years
------------ -------- -------- --------- -------- --------- ---------
NAV per
Share Total
Return 4.4% 12.0% 24.4% 19.2% 16.4% 13.6%
Share Price
Total
Return (3.4)% 11.8% 27.1% 16.3% 14.3% 15.6%
FTSE
All-Share
Index Total
Return 2.0% 5.6% 18.9% 6.7% 5.4% 7.4%
Three months to: Six months to: 12 months to:
------------------ ------------------- ----------------------
31 Jan. 31 Jan. 31 Jan. 31 Jan. 31 Jan. 31 Jan.
2022 2021 2022 2021 2022 2021
------------ -------- -------- --------- -------- --------- -----------
Portfolio
Return on a
Local
Currency
Basis 4.9% 17.1% 13.5% 7.9% 29.4% 24.9%
NAV per
Share Total
Return 4.4% 11.8% 12.0% 9.6% 24.4% 22.5%
Realisation GBP68.3m GBP43.0m GBP158.3m GBP98.3m GBP333.5m GBP137.4m
Proceeds
Total New GBP95.2m GBP57.2m GBP170.3m GBP86.8m GBP303.7m GBP139.2m
Investment
ENQUIRIES
Investor / Analyst enquiries:
Oliver Gardey, Head of Private Equity Fund Investments, ICG +44 (0) 20 3545 2000
Colm Walsh, Managing Director, Private Equity Fund Investments,
ICG
Chris Hunt, Head of Shareholder Relations, ICG
Media enquiries:
Clare Glynn, Corporate Communications, ICG +44 (0) 20 3545 1395
Website:
www.icg-enterprise.co.uk
Company timetable
Annual General Meeting: 28 June 2022
Q1 trading update: 28 June 2022
Ex-dividend date: 7 July 2022
Record date: 8 July 2022
Payment of dividend: 22 July 2022
ABOUT ICG ENTERPRISE TRUST
ICG Enterprise Trust is a leading listed private equity investor
focused on creating long-term growth by delivering consistently
strong returns through selectively investing in profitable private
companies, primarily in Europe and the US.
As a listed private equity investor, our purpose is to provide
shareholders with access to the attractive long-term returns
generated by investing in private companies, with the added benefit
of daily liquidity.
We invest in companies directly via Co-investments and through
funds managed by ICG and other leading private equity managers who
focus on creating long-term value and building sustainable growth
through active management and strategic change.
We have a long track record of delivering strong returns through
a flexible mandate and highly selective approach that strikes the
right balance between concentration and diversification, risk and
reward.
NOTES
Included in this document are Alternative Performance Measures
("APM"). APM have been used if considered by the Board and the
Manager to be the most relevant basis for shareholders in assessing
the overall performance of the Company, and for comparing the
performance of the Company to its peers and its previously reported
results. The Glossary includes further details of APMs and
reconciliations to International Financial Reporting Standards
("IFRS") measures, where appropriate.
In the Chair's Foreword, Manager's Review and Supplementary
Information, all performance figures are stated on a Total Return
basis (i.e., including the effect of re-invested dividends). ICG
Alternative Investment Limited, a regulated subsidiary of
Intermediate Capital Group plc, acts as the Manager of the
Company.
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.
CHAIR'S FOREWORD
I am pleased to report that your Company has performed strongly
during the year, continuing to build on its track record of
delivering strong risk-adjusted returns for its shareholders.
ICG Enterprise Trust's NAV at 31 January 2022 was GBP1.2bn,
equating to 1,690p NAV per Share. The Company has delivered 24.4%
NAV per Share Total Return during the financial year. On a
five-year annualised basis, NAV per Share Total Return is 16.4%.
This performance is net of all fees.
The performance underlines the benefits of our strategy, with
our more focussed High Conviction Portfolio enhancing the returns
of our more diversified Third Party Investments over the long term.
In line with this approach, ICG Enterprise Trust has continued to
deploy capital into a number of High Conviction Investments. I have
been particularly pleased to see four new Co-investments alongside
our Manager, ICG, and the significant progress we have made during
the year on developing our portfolio of Secondary Investments. We
were able to make these investments given the strong Realisation
activity we experienced: during the year we received Total Proceeds
of GBP342.9m and deployed GBP303.7m into new investments,
generating net proceeds of GBP39.2m. At 31 January 2022 we had
GBP208.4m of available liquidity.
Following the tragic events in Ukraine this calendar year, we
are mindful of the heightened levels of volatility and geopolitical
uncertainty. While we have no material direct exposure to Russia or
Ukraine, we remain conscious of the potential indirect impact of
macroeconomic risks such as increasing energy prices, disrupted
supply chains, and a squeeze on consumer spending. In this
environment, we feel our focus on businesses with defensive growth
characteristics positions us well to navigate these dynamic market
conditions. We remain alert to the changing situation and potential
risks. More detail on our risk management can be found on page
20.
Delivering on our strategic goals
During the financial year we made further progress against our
strategic goals: our new investment activity was heavily weighted
towards High Conviction Investments (61.1% of Total New Investments
in FY22) and we maintained our North American exposure in line with
our target range of 40 - 50%. During the year, the Board determined
that we should develop our Secondaries programme more
systematically and that we should target allocating 15 - 25% of the
Portfolio to Secondary Investments. In line with this, we made a
number of investments during the year which meaningfully increased
our exposure, bringing it within this target range (31 January
2022: 17.9%; 31 January 2021: 11.8%).
High Conviction Investments represented 48.9% of the Portfolio
at 31 January 2022 and have generated an annualised local currency
return of 23.9% over the last five years. We expect these
investments to continue to enhance the strong returns generated
from our Third Party Funds, which have returned an annualised local
currency return of 17.8% over the last five years.
Since appointing ICG as the Manager six years ago, we have
become more fully invested, reducing the impact of cash drag on
performance. At 31 January 2022 the Portfolio represented 101.2% of
Net Assets (31 January 2016: 82.1%).
Providing public access to private equity
There is an increasing recognition that private equity can play
a valuable role for both individual and institutional investors
with a long-term perspective. However, it can be challenging for
certain investors to gain exposure to private equity assets. ICG
Enterprise Trust helps to solve this problem: by investing in ICG
Enterprise Trust, shareholders gain access to a mature and actively
managed portfolio of private equity investments, with the added
benefit of daily liquidity.
Despite the Company's strong and consistent track record, ICG
Enterprise Trust's shares continue to trade at a Discount to NAV
(26.3% on 31 January 2022 against last published NAV of 1,628p at
31 October 2021). The Board considers that the Company's
performance, and the value of its Manager's expertise and network,
are not appropriately recognised in its share price.
During the year we have worked closely with the investment
community, including professional, institutional, and private
wealth managers, stock market analysts, and the media to increase
ICG Enterprise Trust's profile and improve investors' understanding
of the sector and our role within it.
Importance of investing responsibly
Responsible investing remains a focus for our investment team,
who are able to utilise the Manager's considerable resources in
this area to support their own investment analysis to ensure that
our investment programme is compatible with our wider ESG
framework. The Board believes that the long-term success of the
Company requires the effective management of both financial and
non-financial measures, and fully endorses the increasing emphasis
on this important topic.
Board evolution
Sandra Pajarola is retiring from the Board on 28 June 2022,
having served as a non-executive director for nine years. During
her tenure, Sandra has been an invaluable member of the Board,
bringing a wealth of experience and expertise to our discussions,
in particular around private equity investing. On behalf of the
Board and the shareholders of ICG Enterprise Trust, I would like to
extend my sincere thanks to Sandra for her dedication and many
contributions, and to wish her all the very best for her future
endeavours. In line with our focus on appropriate Board composition
and succession planning, the Board is undertaking a search for new
non-executive directors and will update shareholders in due
course.
Dividend and share buyback
The Board continues to view the dividend as an important
component of shareholder return and remains committed to a
progressive dividend policy. The Board is proposing a final
dividend of 9p per share. Together with the three interim dividends
of 6p per share each, this will take total dividends for the year
to 27p per share, representing a 12.5% increase on the prior year
dividend. This marks the sixth consecutive year of dividend
increases. During the year the Board also purchased 250,000 shares
at an average price of 1,070p each. In aggregate the Board
therefore allocated GBP21.2m(1) to cash returns to shareholders
during FY22.
Annual General Meeting
The Annual General Meeting will be held on 28 June 2022. The
Board will be formally communicating with shareholders outlining
the format of the meeting separately in the Notice of Meeting. This
will include details of how shareholders may register their
interest in attending the Annual General Meeting, either in person
or via videoconference.
Well-placed to continue to generate value for our
shareholders
ICG Enterprise Trust is in good health, with a strong balance
sheet and a diversified Portfolio that remains well-positioned to
withstand the increased volatility that has affected the global
markets so far in 2022. We are encouraged by the performance of our
Portfolio, which is a testament to our strategy and our focus on
investments with defensive growth characteristics. We believe we
offer an attractive investment vehicle for public market investors
to access high-quality, privately-owned businesses.
The structure of the Portfolio enables the Company to benefit
from diversification whilst retaining more concentrated exposure to
High Conviction Investments with defensive growth characteristics.
This approach has successfully generated double-digit NAV per Share
Total Return to our shareholders not only in the last year but over
the long term.
We are confident that your Company has the expertise, network
and financial resources to successfully execute on its strategy,
and we believe that we have a promising future.
Jane Tufnell
Chair
12 May 2022
MANAGER'S REVIEW
Alternative Performance Measures
The Board and the Manager monitor the financial performance of
the Company on the basis of Alternative Performance Measures (APM),
which are non-IFRS measures. The APM predominantly form the basis
of the financial measures discussed in this review, which the Board
believes assists shareholders in assessing their investment and the
delivery of the investment strategy.
The Company holds certain investments in subsidiary entities.
The substantive difference between APM and IFRS is the treatment of
the assets and liabilities of these subsidiaries. The APM basis
"looks through" these subsidiaries to the underlying assets and
liabilities they hold, and it reports the investments, less the
Co-investment scheme liability, as the Portfolio APM. Under IFRS,
the Company and its subsidiaries are reported separately. The
assets and liabilities of the subsidiaries are presented on the
face of the IFRS balance sheet as a single carrying value. Then
same is true for the IFRS and APM basis of the Cash flow
statement.
The Company's Investments (IFRS) were GBP1,124.0m (2021:
GBP907.5m), an increase of 23.8% on the prior year; Net Asset Value
(NAV) (IFRS) was GBP1,158.0m (2021: GBP952.0m), an increase of
21.6% on the prior year; and Portfolio (APM) was GBP1,172.2m (2021:
949.2m), an increase of 23.5% on the prior year.
Cash flows from the sale of portfolio investments (IFRS) were
GBP101.0m (2021: GBP147.5m) while Total Proceeds (APM) were
GBP342.9m (2021: GBP209.2m) including Realisation Proceeds (APM) of
GBP333.5m (2021: GBP137.3m). Cash flows related to the purchase of
Portfolio investments (IFRS) were GBP75.1m (2021: GBP86.1m), while
Total New Investment (APM) was GBP303.7m (2021: GBP139.2m).
The Glossary on page 38 include definitions for all APM and,
where appropriate, a reconciliation between APM and IFRS.
Our investment strategy
We aim to deliver attractive risk-adjusted returns by executing
our focused and differentiated investment strategy. We focus on
investing in buyouts of businesses that are profitable, cash
generative and have defensive growth characteristics that we
believe will deliver strong and resilient returns across all
economic cycles. Geographically we focus on the developed markets
of North America, Europe and the UK, which have deep and mature
private equity markets.
We find these characteristics in a range of companies, reflected
in the diversified sectors in which our Portfolio is invested.
There are a number of themes that contribute to a business having,
in our view, defensive growth characteristics. These include (among
others) attractive market positioning, providing mission-critical
services to their clients and customers, ability to pass on price
increases, and structurally high margins.
We invest in businesses directly, through ICG-managed funds, and
through third-party private equity managers. When combined, we
believe this results in a unique and balanced portfolio with
attractive growth characteristics. Our Portfolio composition is
shown below:
31 January 2022 31 January 2022 31 January 2021
Investment category GBPm % of Portfolio % of Portfolio
--------------------------- --------------- --------------- ---------------
ICG-managed investments 315 27% 23%
Third Party Direct
Investments 190 16% 21%
Third Party Secondary
Investments 68 6% 7%
--------------------------- --------------- --------------- ---------------
High Conviction Investments 573 49% 51%
--------------------------- --------------- --------------- ---------------
Third Party Funds 599 51% 49%
--------------------------- --------------- --------------- ---------------
Portfolio 1,172 100% 100%
--------------------------- --------------- --------------- ---------------
Performance overview
Continuing our track record of growth
Despite businesses worldwide facing ongoing challenges due to
sustained impact from the COVID-19 pandemic, rising inflation, and
concerns around potential interest rate rises, we continued to
deliver strong NAV growth, generating NAV per Share Total Return of
24.4% and ending the year with a NAV per Share of 1,690p.
At 31 January 2022, our Portfolio was valued at GBP1,172.2m,
reflecting a 29.4% Portfolio Return on a Local Currency Basis
(FY21: 24.9%). Our Portfolio growth represents strong performance
across all areas of our investment strategy.
Our growth this year extends the track record of strong
performance that we have delivered for our shareholders. Over the
last five years, our Portfolio has generated an annualised
Portfolio Return on a Local Currency Basis of 20.4% and FY22 is the
13(th) consecutive year that we have delivered a double-digit
Portfolio Return on a Local Currency Basis.
Year ended Year ended
Movement in the Portfolio 31 January 2022 31 January 2021
GBPm GBPm GBPm
------------------------------------------ ---------------- ----------------
Opening Portfolio* 949.2 806.4
---------------- ----------------
Total New Investments 303.7 139.2
Total Proceeds (342.9) (209.2)
---------------- ----------------
Net (proceeds)/investments (39.2) (70.0)
Valuation Movement** 279.4 200.6
Currency movement (17.2) 12.2
------------------------------------------ ---------------- ----------------
Closing Portfolio* 1,172.2 949.2
------------------------------------------ ---------------- ----------------
% Portfolio growth (local currency) 29.4% 24.9%
% currency movement (1.8)% 1.5%
------------------------------------------ ---------------- ----------------
% Portfolio growth (Sterling) 27.6% 26.4%
Effect of cash drag (0.1)% 0.4%
------------------------------------------ ---------------- ----------------
Expenses and other income (1.5)% (1.9)%
------------------------------------------ ---------------- ----------------
Co-investment Incentive Scheme Accrual (1.8)% (2.8%)
------------------------------------------ ---------------- ----------------
Impact of share buybacks and dividend
reinvestment 0.2% 0.4%
------------------------------------------ ---------------- ----------------
NAV per Share Total Return 24.4% 22.5%
------------------------------------------ ---------------- ----------------
* Refer to the Glossary for reconciliation to the
Portfolio balance
** 98% of the Portfolio is valued using financial
year-end (or later) valuations (2021: 95%).
Broad-based growth across High Conviction Investments and Third
Party Funds
The benefits of our approach to portfolio construction are
demonstrated by our long-term track record. Over the last five
years, our High Conviction Investments have generated an annualised
Portfolio Return on a Local Currency Basis of 23.9% p.a. and our
Third Party Fund investments have generated an annualised Portfolio
Return on a Local Currency Basis of 17.8% p.a.
High Conviction Investments represented 48.9% of the Portfolio
value at 31 January 2022 (31 January 2021: 50.7%). We anticipate
that High Conviction Investments will continue to represent 50% -
60% of the Portfolio in the medium term.
During the year High Conviction Investments generated a 23.1%
Portfolio Return on a Local Currency Basis. Key contributors to the
performance included IRI (a provider of mission-critical data and
predictive analytics to consumer goods manufacturers) and Visma (a
provider of business management software and outsourcing services).
The Secondary Investments made during the year have already shown
positive returns, benefitting from the performance of a mature
portfolio of invested assets.
Third Party Funds generated a 36.0% Portfolio Return on a Local
Currency Basis for the year (FY21: 22.4%) and represented 51.1% of
the Portfolio value at 31 January 2022 (31 January 2021: 49.3%).
These returns were driven by the strong performance of a number of
funds that we invest in, including those managed by Advent,
Gridiron, CVC and Thomas H. Lee, as well as the realisation of
U-POL.
Top 30 companies report another period of double-digit revenue
and earnings growth
Our largest 30 underlying companies ("Top 30 companies")
represented 39.0% of the Portfolio by value at 31 January 2022 (31
January 2021: 51.8%). There were 13 new entrants to our Top 30
companies within the period. Three of these were existing holdings
in the Portfolio, whilst 10 were new investments made during the
period.
The geographic exposure of the Top 30 companies reflects our
broader focus on developed private markets: 50.1% of the Top 30 by
Portfolio value is invested in the US, 24.0% in Europe, with the
remainder in the UK and the rest of the world.
The Top 30 companies delivered impressive operational
performance during the year, generating LTM revenue growth of 27.1%
and LTM EBITDA growth of 29.6%.(2) (,) (3)
Of the Top 30 companies, EBITDA is a relevant valuation metric
for 27(4) , which in aggregate represent 33.0% of the Portfolio by
value. At 31 January 2022, based on the valuation information
provided by the underlying managers, the average Enterprise Value /
EBITDA of these companies was 14.6x (31 January 2021: 14.0x). The
Net Debt / EBITDA ratio of the same companies was 4.3x (31 January
2021: 4.3x).
Realisation activity
Strong realisation activity reflects high demand for quality
assets
FY22 represented a strong year of Realisation activity for ICG
Enterprise Trust, with Total Proceeds for the period of GBP342.9m,
comprised of GBP333.5m of realisations from individual companies
(either held directly or through funds) and GBP9.4m of proceeds
from Fund Disposals.
This was the highest level of Realisation Proceeds in the last 5
years and represents 35.1% of FY21 closing Portfolio value (as at
31 January 2021).
There were 54 Full Exits of Portfolio holdings during the
period, generating proceeds of GBP210.5m.Full Exits were completed
at an average Multiple to Cost of 2.6x, and an average Uplift To
Carrying Value of 36.3% Partial exits generated Realisation
Proceeds of GBP123.0m.
Four of our Top 30 companies at the beginning of the financial
year were fully realised during the period. The largest exit was
Telos, the 2(nd) largest investment at the start of the financial
year, which we fully realised early in the period. This holding was
exited through a sale of shares in the quoted business, following
Telos' IPO in 2020. The exit was completed at a slight uplift to
the 31 January 2021 carrying value and generated a 33.0x return on
invested capital. In September 2021, Graphite Capital completed the
trade sale of U-POL (previously ranked third in our Top 30
holdings), to US-listed Axalta Coating Systems. This transaction
generated proceeds of GBP22.9m, representing a 4.5x return on
invested capital. Other notable Realisations included the exit of
Supporting Education Group, an ICG investment, which was the 10(th)
largest underlying Portfolio Company at the start of the year, and
Cognito, an investment alongside Graphite Capital.
New investment activity
Executing on an attractive investment pipeline
During the period we were able to successfully execute on a
number of attractive investments in our pipeline. In total during
the year, we invested GBP303.7m, of which GBP185.6m (61.1%) was in
High Conviction Investments and GBP118.1m were primary Drawdowns
from Third Party Funds.
New investment FY22
Investment Category (GBPm) % of New investments
--------------------------------- ------------------- --------------------
High Conviction Investments 186 61%
--------------------------------- ------------------- --------------------
Drawdowns from Third Party Funds 118 39%
--------------------------------- ------------------- --------------------
Total 304 100%
--------------------------------- ------------------- --------------------
Within the GBP185.6m of High Conviction Investments, GBP108.7m
was invested alongside ICG and GBP76.9m was deployed through
third-party managers. Fund investments represented GBP100.5m of
High Conviction Investments, with GBP85.1m invested across 21
individually-selected Co-investments. 10 of these Co-investments
represent new investments for ICG Enterprise Trust, and 11 were
follow-on investments (totalling GBP5.1m) to companies already held
in our Portfolio. Of the 10 new investments, four were alongside
ICG and six were alongside third-party managers. The ten new
Co-investments are listed overleaf.
Company Manager Company sector / description ICG
Enterprise
Trust
investment
during the
period
---------- ----------- ----------------------------------------------------- ----------
Ambassador ICG Operator of theatres and ticketing platforms GBP11.4m
Theatre
Group
---------- ----------- ----------------------------------------------------- ----------
DomusVi ICG Operator of retirement homes GBP11.2m
---------- ----------- ----------------------------------------------------- ----------
Planet Eurazeo / Provider of integrated payments services focused on GBP9.6m
Payment Advent hospitality and luxury retail
---------- ----------- ----------------------------------------------------- ----------
Ivanti Charlesbank Provider of enterprise IT software GBP8.8m
---------- ----------- ----------------------------------------------------- ----------
Davies BC Partners Provider of business process outsourcing services GBP8.7m
Group to the insurance sector
---------- ----------- ----------------------------------------------------- ----------
Brooks Thomas H. Provider of semiconductor manufacturing solutions GBP7.7m
Automation Lee
---------- ----------- ----------------------------------------------------- ----------
Class Gridiron Provider of residential mortgage appraisal management GBP6.9m
Valuation services
---------- ----------- ----------------------------------------------------- ----------
European PAI Operator of premium campsites and holiday parks GBP6.9m
Camping
Group
---------- ----------- ----------------------------------------------------- ----------
DigiCert ICG Provider of enterprise internet security solutions GBP6.7m
---------- ----------- ----------------------------------------------------- ----------
AMEOS ICG Operator of private hospitals GBP4.2m
Group
---------- ----------- ----------------------------------------------------- ----------
New Commitments
During the year we made a total of GBP189.9m of new Commitments
to funds, of which GBP117.3m was to ICG-managed funds and GBP72.6m
were to Third Party Funds.
ICG-managed funds
During the period we committed GBP117.3m to four ICG-managed
funds, including to three funds that focus on Secondary
transactions. The breakdown of Commitments made to ICG-managed
funds was as follows:
Fund Focus ICG Enterprise Trust
Commitment during the
period
------------------------- ------------------------ -------------------------
ICG Ludgate Hill I Secondary portfolio of EUR45.0m (GBP38.7m)
mid-market and large
buyouts
------------------------- ------------------------ -------------------------
ICG Europe Fund VIII Mezzanine and equity in EUR40m (GBP34.8m)
mid-market buyouts
------------------------- ------------------------ -------------------------
ICG Strategic Equity Fund Secondary fund $40m (GBP28.8m)
IV restructurings
------------------------- ------------------------ -------------------------
ICG Ludgate Hill II Secondary portfolio of $20m (GBP15.0m)
mid-market and large
buyouts
------------------------- ------------------------ -------------------------
Third Party Funds
During the year we committed GBP72.6m to Third Party Funds
including Commitments made to new funds and Commitments inherited
as part of fund positions acquired in the secondary market. We
sought to identify leading managers who complement our long-term
strategic objectives, are committed to values aligned to our
Responsible Investing framework and have an investment approach
that suits our defensive growth focus. In the period we made
combined Commitments of GBP69.3m into seven new Third Party Funds,
four of which were to managers with whom we have not invested
before, demonstrating our continued ability to originate and
execute new opportunities to work with leading managers.
The breakdown of Commitments made to new Third Party Funds was
as follows:
Fund Focus ICG Enterprise Trust
Commitment during the
period
------------------------- ------------------------- ------------------------
Thomas H. Lee IX North American mid-market $20m (GBP14.1m)
and large buyouts
------------------------- ------------------------- ------------------------
BC Partners XI European and North EUR15m (GBP12.8m)
American mid-market
buyouts
------------------------- ------------------------- ------------------------
Resolute V North American mid-market $15m (GBP10.9m)
buyouts
------------------------- ------------------------- ------------------------
Bregal Unternehmerkapital European mid-market EUR10m (GBP8.6m)
III* buyouts
------------------------- ------------------------- ------------------------
GHO Capital III* European and North EUR10m (GBP8.6m)
American mid-market
buyouts
------------------------- ------------------------- ------------------------
GI Partners VI* North American mid-market $10m (GBP7.2m)
buyouts
------------------------- ------------------------- ------------------------
Hellman and Friedman X* North American mid-market $10m (GBP7.1m)
and large buyouts
------------------------- ------------------------- ------------------------
* New manager relationship during the period
------------------------------------------------------------------------------
Portfolio analysis
Portfolio composition overview
The Portfolio is actively managed and structured to strike a
balance between both concentration - so that Direct Investments can
meaningfully impact performance - and diversification, so that we
are not overly exposed to the risks of individual portfolio
companies or sectors. We also seek to ensure appropriate
diversification by sector and by geography in the Portfolio. The
Top 30 underlying investments in the Portfolio represented 39.0% of
the Portfolio value at 31 January 2022. Within the Top 30 holdings,
27 were High Conviction Investments.
Focus on developed markets
The Portfolio is focused on developed private equity markets,
invested across the US (41.4%), continental Europe (32.1%) and the
UK (18.6%).
Focus on sectors with defensive growth characteristics
The Portfolio is well diversified and weighted towards sectors
with defensive growth characteristics. Technology (24.1%),
Healthcare (16.6%), Business Services (11.0%) and Education (5.1%)
make up 56.8% of the Portfolio. We feel these are particularly
attractive sectors, benefitting from structural growth trends.
Within our exposure to the Consumer and Industrial sectors (20.8%
and 8.3% respectively), we have a bias to companies with more
defensive business models, non-cyclical growth drivers and high
recurring revenue streams. We have relatively low exposure to the
Financials and Leisure sectors (5.5% and 3.9% respectively).
Quoted Companies
We do not actively invest in publicly-quoted companies, but gain
listed investment exposure when IPOs are used as a route to exit an
investment. In these cases, exit timing typically lies with the
third-party manager alongside whom we have invested.
During the financial year, 17 portfolio companies were publicly
listed. The listings generated a combined gross valuation uplift
for the Company of GBP17.1m compared to their valuation at 31
January 2021.
At 31 January 2022, we had 45 underlying investments in quoted
companies, representing 10.3% of the Portfolio value (31 January
2021: 20.4%). The reduction in listed exposure was largely driven
by the Full Exit of Telos during February (4.6% of our Portfolio
value at 31 January 2021) and the 53.2% decline in Chewy's share
price during the financial year. Despite Chewy's share price
performance this year, ICG Enterprise Trust's investment in
PetSmart (which includes Chewy) has delivered a strong return on
investment for our shareholders.
At 31 January 2022 there were two quoted investments that
individually accounted for 0.5% or more of the Portfolio value:
Company Ticker % value of Portfolio
----- --------------------------- ------- --------------------
1 Chewy (part of PetSmart)(1) CHWY-US 4.6%
----- --------------------------- ------- --------------------
2 Olaplex* OLPX-US 0.6%
----- --------------------------- ------- --------------------
Other 5.1%
----- --------------------------- ------- --------------------
Total 10.3%
----- --------------------------- ------- --------------------
(1) % value of Portfolio includes entire holding of
PetSmart and Chewy. Majority of value is within Chewy
* Company listed during the period
Exposure to Russia and Ukraine
Our Portfolio has no material exposure to Russia or Ukraine. We
continue to monitor the situation closely and remain alert to
potential direct or indirect implications.
Balance sheet and financing
At 31 January 2022 we had a cash balance of GBP41.3m (31 January
2021: GBP45.1m) and total available liquidity of GBP208.4m.
GBPm
-------------------------------------------------- -----
Cash at 31 January 2021 45
Realisation Proceeds 334
Fund Disposals 9
Third Party Fund Drawdowns (118)
High Conviction Investments (186)
Shareholder returns (21)
FX and other (23)
-------------------------------------------------- -----
Cash at 31 January 2022 41
-------------------------------------------------- -----
Available undrawn debt facilities 167
-------------------------------------------------- -----
Cash and undrawn debt facilities (total available
liquidity) 208
-------------------------------------------------- -----
At 31 January 2022 the Portfolio represented 101.2% of net
assets (31 January 2021: 100%).
31 January 2022 31 January 2021
GBPm GBPm
---------------------------------------- --------------- ---------------
Portfolio* 1,172 949
Cash 41 45
Co-investment Incentive Scheme Accrual^ (49) (42)
Other Net Liabilities*^ (7) (0)
Net assets 1,158 952
---------------------------------------- --------------- ---------------
* Refer to the Glossary for reconciliation from the Investments
at fair value presented on the balance sheet to the Portfolio
balance and calculation of Other Net Liabilities
^ 31 January 2021 value impacted by rounding (Co-investment
Incentive Scheme Accrual: GBP(41.8)m; Other Net Liabilities
GBP(0.7)m)
At 31 January 2022, we had Undrawn Commitments of GBP418.6m (31
January 2021: GBP418.5m) of which 22.9% (GBP95.8m) were to funds
outside of their Investment Period.
31 January 2022 31 January 2021
GBPm GBPm
-------------------------------------------- --------------- ---------------
Undrawn Commitments -- funds in Investment
Period 323 341
Undrawn Commitments -- funds outside
Investment Period 96 77
-------------------------------------------- --------------- ---------------
Total Undrawn Commitments 419 418
Total available liquidity (including
facility) (208) (201)
-------------------------------------------- --------------- ---------------
Overcommitment (including facility) 211 217
-------------------------------------------- --------------- ---------------
Overcommitment % of net asset value 18% 23%
-------------------------------------------- --------------- ---------------
Our objective is to be fully invested through the cycle, while
ensuring that we have sufficient liquidity to be able to take
advantage of attractive investment opportunities as they arise. We
do not intend to be geared other than for short-term working
capital purposes.
Activity since the period end
Activity between 1 February 2022 and 31 March 2022 has
included:
-- Realisation Proceeds of GBP92m
-- New Investments of GBP70m (52%% into High Conviction Investments)
-- Three new Fund Commitments totalling GBP79m
Effective as at 3(rd) May 2022, we have increased the size of
our Revolving Credit Facility ("RCF") to EUR240m (from EUR200m
previously), in keeping with the Company's higher net asset value.
We have also extended the maturity by one year to February 2026.
The other key terms remain unchanged. The RCF is available for
general corporate purposes, including short-term financing of
investments such as the Drawdown on Commitments to funds.
Outlook
We believe that the private equity model of active ownership is
well positioned to generate long-term value and to withstand market
volatility and economic uncertainty.
Calendar year 2022 is expected to see a large number of
experienced private equity managers raising capital for new funds.
This is creating attractive opportunities for ICG Enterprise Trust,
with favourable supply/demand dynamics enabling us to selectively
commit to funds managed by top-tier managers.
We remain focused on disciplined Deployment into attractive
Co-investment opportunities, and to further growing our secondaries
programme.
In line with our investment strategy, our Portfolio is invested
into companies exhibiting characteristics of defensive growth,
including strong cash flow generation, high margins, market leading
positions in sectors with high barriers to entry, and strong
ability to pass on cost increases. We believe that these attributes
are likely to make them resilient investments, even in an
inflationary and rising interest rate environment. We believe that
this positions us well to continue to deliver attractive returns
and to create value for our shareholders through FY23 and
beyond.
ICG Private Equity Fund Investments Team
12 May 2022
SUPPLEMENTARY INFORMATION (UNAUDITED)
This section presents supplementary information regarding the
Portfolio (see Manager's Review and the Glossary for further
details and definitions).
Top 30 companies
The table below presents the 30 companies in which ICG
Enterprise Trust had the largest investments by value at 31 January
2022.
The valuations are gross of underlying managers fees and Carried
interest.
Value as
Year of a % of
Company Manager investment Country Portfolio
----------------------------------------------------------- ------------ ----------- ------------ ---------
1 PetSmart/Chewy+
Retailer of pet products and services BC Partners 2015 United States 4.6%
2 Minimax+
Supplier of fire protection systems and services ICG 2018 Germany 2.7%
3 IRI+
Provider of mission-critical data and predictive analytics
to consumer goods manufacturers New Mountain 2018 United States 2.7%
4 Yudo+
Designer and manufacturer of hot runner systems ICG 2017 South Korea 2.2%
5 Leaf Home Solutions
Provider of home maintenance services Gridiron 2016 United States 2.0%
6 DOC Generici+
Manufacturer of generic pharmaceutical products ICG 2019 Italy 1.7%
7 Endeavor Schools+
Provider of private schooling Leeds Equity 2018 United States 1.7%
8 Froneri+
Manufacturer and distributor of ice cream products PAI 2019 United Kingdom 1.6%
9 Visma+
Provider of business management software and outsourcing Hg Capital /
services ICG 2017 / 2020 Norway 1.4%
10 David Lloyd Leisure+
Operator of premium health clubs TDR 2013 / 2020 United Kingdom 1.3%
11 DomusVi+
Operator of retirement homes ICG 2021 France 1.3%
12 DigiCert+
Provider of enterprise internet security solutions ICG 2021 United States 1.3%
13 AML RightSource+
Provider of compliance and regulatory services and
solutions Gridiron 2020 United States 1.2%
14 Ivanti+
Charlesbank
Provider of IT management solutions / ICG 2021 United States 1.1%
15 PSB Academy+
Provider of private tertiary education ICG 2018 Singapore 1.1%
16 Curium Pharma+
CapVest /
Supplier of nuclear medicine diagnostic pharmaceuticals ICG 2020 United Kingdom 1.0%
17 Precisely
Provider of enterprise software ICG 2021 United States 0.9%
18 Planet Payment+
Provider of integrated payments services focused on Eurazeo /
hospitality and luxury retail Advent 2021 Ireland 0.9%
19 Ambassador Theatre Group+
Operator of theatres and ticketing platforms ICG 2021 United Kingdom 0.8%
20 Davies Group+
Provider of business process outsourcing services
to the insurance sector BC Partners 2021 United Kingdom 0.8%
21 Class Valuation+
Provider of residential mortgage appraisal management
services Gridiron 2021 United States 0.7%
22 RegEd+
Provider of SaaS-based governance, risk and compliance
enterprise software solutions Gryphon 2018 United States 0.7%
23 Crucial Learning+
Provider of corporate training courses focused on
communication skills and leadership development Leeds Equity 2019 United States 0.7%
24 MoMo Online Mobile Services
Operator of remittance and payment services via mobile
e-wallet ICG 2019 Vietnam 0.7%
25 European Camping Group+
Operator of premium campsites and holiday parks PAI 2021 France 0.7%
26 Brooks Automation+
Thomas H.
Provider of semiconductor manufacturing solutions Lee 2022 United States 0.7%
27 Olaplex
Provider of hair care products Advent 2020 United States 0.6%
28 AMEOS Group+
Operator of private hospitals ICG 2021 Switzerland 0.6%
29 nGAGE
Provider of recruitment services Graphite 2014 United Kingdom 0.6%
30 WCT
The Jordan
Provider of clinical research outsourcing services Company 2021 United States 0.6%
Total of the 30 largest underlying investments 39.0%
---------------------------------------------------------------------------------------------------- ---------
+ All or part of this investment is held directly as a
Co-investment or other Direct Investment
The 30 largest fund investments
The table below presents the 30 largest funds by value at 31
January 2022. The valuations are net of underlying managers fees
and Carried interest.
Outstanding
Year of Value Commitment
Fund Commitment Country/ region GBPm GBPm
------------------------------------------- ----------- ---------------- ----- -----------
1 ICG Ludgate Hill I
Secondary portfolio of mid-market and large Europe/
buyouts 2021 North America 42.6 13.7
2 ICG Europe Fund VII
Mezzanine and equity in mid-market buyouts 2018 Europe 36.1 10.3
3 ICG Strategic Equity Fund III
Secondary fund restructurings 2018 Global 35.0 10.3
4 Graphite Capital Partners VIII
Mid-market buyouts 2013 UK 32.0 4.4
5 BC European Capital IX
Europe/
Large buyouts 2011 North America 30.6 1.7
6 Gridiron Capital Fund III
Mid-market buyouts 2016 North America 27.5 4.1
7 CVC European Equity Partners VII
Europe/
Large buyouts 2017 North America 26.9 3.2
8 CVC European Equity Partners VI
Europe/
Large buyouts 2013 North America 24.5 2.1
9 Cinven VI
Europe/
Large buyouts 2016 North America 23.0 1.6
10 Thomas H. Lee Equity Fund VIII
Mid-market and large buyouts 2017 North America 20.0 3.7
11 Permira V
Europe/
Large buyouts 2013 North America 19.4 0.5
12 PAI Strategic Partnerships
Mid-market and large buyouts 2019 Europe 19.3 0.6
13 BC European Capital X
Large buyouts 2016 Europe 18.3 0.6
14 PAI Europe VI
Mid-market and large buyouts 2013 Europe 17.8 1.4
15 Advent IX
Europe/
Large buyouts 2019 North America 17.2 5.5
16 Advent Global Private Equity VIII
Europe/
Large buyouts 2016 North America 16.2 0.6
17 TDR Capital III
Mid-market and large buyouts 2013 Europe 15.6 1.5
18 ICG Strategic Equity Fund IV
Secondary fund restructurings 2021 Global 15.2 17.4
19 New Mountain Partners V
Mid-market buyouts 2017 North America 15.2 1.2
20 PAI Europe VII
Mid-market and large buyouts 2017 Europe 15.0 10.2
21 Gryphon V
Mid-market buyouts 2019 North America 15.0 1.8
22 Resolute IV
Mid-market buyouts 2018 North America 14.9 1.6
23 ICG Europe Fund VI
Mezzanine and equity in mid-market buyouts 2015 Europe 14.3 4.2
24 Oak Hill V
Mid-market buyouts 2019 North America 13.9 1.9
25 Gridiron Capital Fund IV
Mid-market buyouts 2019 North America 13.7 4.3
26 ICG Augusta Partners Co-Investor
Secondary fund restructurings 2018 Global 12.9 17.6
27 ICG Ludgate Hill II
Secondary portfolio of mid-market and large
buyouts 2022 North America 12.0 5.2
28 Resolute II Continuation Fund
Mid-market buyouts 2021 North America 11.7 2.1
29 Leeds Equity Partners VI
Mid-market buyouts 2017 North America 11.4 0.6
30 Permira VI
Europe /
Large buyouts 2016 North America 11.2 1.9
Total of the largest 30 fund investments 598.3 135.7
Percentage of total investment Portfolio 51.0%
-------------------------------------------------------------------------- ----- -----------
Portfolio analysis
Portfolio by
calendar
year of % of value of underlying investments % of value of underlying investments
investment 31 January 2022 31 January 2021
------------ ------------------------------------ ------------------------------------
2022 0.1% -
2021 25.1% 0.4%
2020 12.3% 10.1%
2019 15.4% 18.3%
2018 17.9% 18.4%
2017 9.6% 17.1%
2016 5.9% 9.6%
2015 6.6% 11.2%
2014 and
older 7.1% 8.9%
------------ ------------------------------------ ------------------------------------
Total 100.0% 100.0%
------------ ------------------------------------ ------------------------------------
% of value of underlying investments % of value of underlying investments
Portfolio by sector 31 January 2022 31 January 2021
------------------------------------------------------- ------------------------------------ ------------------------------------
TMT 24.1% 19.2%
Consumer goods and services 20.8% 25.4%
Healthcare 16.6% 17.8%
Business services 11.0% 12.5%
Industrials 8.3% 6.9%
Financials 5.5% 4.7%
Education 5.1% 6.4%
Leisure 3.9% 4.5%
Other 4.7% 2.6%
------------------------------------------------------- ------------------------------------ ------------------------------------
Total 100.0% 100.0%
------------------------------------------------------- ------------------------------------ ------------------------------------
% of value of underlying % of value of underlying
Portfolio by geographic distribution based on location investments investments
of company headquarters 31 January 2021 31 January 2021
------------------------------------------------------- ------------------------------------ ------------------------------------
North America 41.4% 42.0%
Europe 32.1% 31.8%
UK and Other 26.5% 26.2%
Total 100.0% 100.0%
------------------------------------------------------- ------------------------------------ ------------------------------------
Commitments analysis
The following tables reflect Commitments at 31 January 2022.
Original foreign currency Commitments are translated at 31 January
2022 exchange rates.
Total Undrawn Commitments
Original Outstanding Average
Commitment Commitment Drawdown % of
GBPm GBPm % Commitments
--------------------------- ----------- ----------- --------- ------------
Funds in Investment Period 587.9 308.9 47.4% 73.8%
Funds post Investment
Period 714.4 109.7 84.6% 26.2%
--------------------------- ----------- ----------- --------- ------------
Total 1,302.3 418.6 67.8% 100.0%
--------------------------- ----------- ----------- --------- ------------
Movement in outstanding Commitments in period ended
31 January 2022 GBPm
---------------------------------------------------- -----
As at 1 February 2021 419
New Fund Commitments 190
New Commitments relating to Co-investments 78
Drawdowns (303)
Commitments released from Fund Disposals (10)
Currency and other movements 45
---------------------------------------------------- -----
As at 31 January 2022 418
---------------------------------------------------- -----
New Commitments during the 12 months ended 31 January 2022
Fund Strategy Geography GBPm
----------------------- ----------------------- --------------------- -----
Secondary portfolio of
mid-market and large
ICG Ludgate Hill I buyouts Europe/North America 38.7
Mezzanine and equity in
ICG Europe Fund VIII mid-market buyouts Europe 34.8
ICG Strategic Equity Secondary fund
Fund IV restructurings Global 28.8
Secondary portfolio of
mid-market and large
ICG Ludgate Hill II buyouts North America 15.0
Mid-market and large
Thomas H. Lee IX buyouts North America 14.1
BC Partners XI Mid-market buyouts Europe/North America 12.8
Resolute V Mid-market buyouts North America 10.9
GHO Capital III Mid-market buyouts Europe/North America 8.6
Bregal
Unternehmerkapital
III Mid-market buyouts Europe 8.6
GI Partners VI Mid-market buyouts North America 7.2
Mid-market and large
Hellman and Friedman X buyouts North America 7.1
Secondary fundholding
Other acquisitions Global 3.2
Total Fund Commitments 189.8
Co-investment Commitments 78.4
----------------------------------------------------------------------- -----
Total New Commitments 268.2
----------------------------------------------------------------------- -----
Currency exposure
31 January 31 January 31 January 31 January
2022 2022 2021 2021
Portfolio(1) GBPm % GBPm %
--------------- ---------- ---------- ---------- ----------
Sterling 290.6 24.8% 197.4 20.8%
Euro 219.9 18.8% 208.3 21.9%
US Dollar 450.6 38.4% 380.5 40.1%
Other European 95.7 8.2% 73.9 7.8%
Other 115.4 9.8% 89.1 9.4%
--------------- ---------- ---------- ---------- ----------
Total 1,172.2 100.0% 949.2 100.0%
--------------- ---------- ---------- ---------- ----------
(1) Currency exposure is calculated by reference to
the location of the underlying Portfolio companies'
headquarters.
31 January 31 January 31 January 31 January
2022 2022 2021 2021
Outstanding Commitments GBPm % GBPm %
------------------------ ---------- ---------- ---------- ----------
-- Sterling 28.7 6.8% 43.7 10.4
-- Euro 200.4 47.9% 195.9 46.8
-- US Dollar 189.5 45.3% 178.2 42.6
-- Other European - - 0.7 0.2
------------------------ ---------- ---------- ---------- ----------
Total 418.6 100.0 418.5 100.0
------------------------ ---------- ---------- ---------- ----------
Realisation activity
Year of Proceeds
Investment Manager investment Exit GBPm
--------------------------- ---------- ----------- -------- --------
Directly
Telos held 1998 Full 44.5
Domus ICG 2017 Full 36.3
U-POL Graphite 2002 Full 23.9
Oak Hill
Berlin Packaging Capital 2014 Partial 19.9
Supporting Education Group ICG 2014 Full 14.7
Thomas H.
System One Lee 2016 Full 11.9
Cognito Graphite 2002 Full 10.9
Hg Capital
Visma / ICG 2014 Partial 10.0
Everlight ICG 2016 Full 5.5
Rough Country Gridiron 2017 Partial 4.8
--------------------------- ---------- ----------- -------- --------
Total of 10 largest underlying
realisations 182.4
--------------------------------------- -------------------- --------
Other Realisation Proceeds 151.2
Fund Disposals 9.4
--------------------------------------- -------------------- --------
Total Proceeds 342.9
---------------------------- -------------------------------- --------
Investment activity
Cost(1)
Investment Description Manager Country GBPm
----------- ------------------------------------------------------ ------------ ------------ -------
Domus Operator of retirement homes ICG France 14.2
United
DigiCert Provider of enterprise internet security solutions ICG States 13.8
Ambassador
Theatre United
Group Operator of theatres and ticketing platforms Providence Kingdom 13.1
Planet Provider of integrated payments services focused on
Payment hospitality and luxury retail Advent Ireland 12.5
United
Ivanti Provider of IT management solutions Charlesbank States 11.8
Davies Provider of specialised business process outsourcing United
Group services ICG Kingdom 9.3
Class Provider of residential mortgage appraisal management United
Valuation services ICG States 8.5
Brooks Thomas H. United
Automation Provider of semiconductor manufacturing solutions Lee States 7.8
European
Camping
Group Operator of premium campsites and holiday parks PAI France 7.7
AMEOS Group Operator of private hospitals ICG Switzerland 6.9
----------- ------------------------------------------------------ ------------ ------------ -------
Total of 10 largest underlying new investments 105.6
Total New Investment 303.7
----------------------------------------------------------------------------------------------- -------
(1) Represents ICG Enterprise Trust's indirect exposure
(share of fund cost) plus any amounts paid for Co-investments
in the period.
PRINCIPAL RISKS AND UNCERTAINTIES
Risk management
The execution of the Company's investment strategy is subject to
a variety of risks and uncertainties, and the Board and Manager
have identified several principal risks to the Company's business.
As part of this process, the Board has put in place an ongoing
process to identify, assess and monitor the principal and emerging
risks facing the Company, including those that would threaten its
business model, future performance, solvency or liquidity.
Principal risks and uncertainties
The Company considers its principal risks (as well as several
underlying risks comprising each principal risk) in four
categories:
Investment risks: the risk to performance resulting from
ineffective or inappropriate investment selection, execution or
monitoring.
External risks: the risk of failing to deliver the Company's
investment objective and strategic goals due to external factors
beyond the Company's control.
Operational risks: the risk of loss resulting from inadequate or
failed internal processes, people or systems and external event,
including regulatory risk.
Financial risks: the risks of adverse impact on the Company due
to having insufficient resources to meet its obligations or
counterparty failure and the impact any material movement in
foreign exchange rates may have on underlying valuations.
A comprehensive risk assessment process is undertaken regularly
to re-evaluate the impact and probability of each risk
materialising and the strategic, financial and operational impact
of the risk. Where the residual risk is determined to be outside of
appetite, appropriate action is taken. Further information on risk
factors is set out within the financial statements.
Principal risks
The Company's principal risks are individual risks, or a
combination of risks, that could threaten the Company's business
model, future performance, solvency or liquidity.
During the year the Company included climate change as a
principal risk (see page 23).
Details of the Company's principal risks, potential impact,
controls and mitigating factors are set out on pages 22 to 26.
Other risks
Other risks, including reputational risk, are potential outcomes
of the principal risks materialising. These risks are actively
managed and mitigated as part of the wider risk management
framework of the Company and the Manager.
Emerging risks
Emerging risks are considered by the Board as they come into
view and are regularly assessed to identify any potential impact on
the Company and to determine whether any actions are required.
Emerging risks often include those related to
regulatory/legislative change and macro-economic and political
change.
The Company depends upon the experience, skill and reputation of
the employees of the Manager. The Manager's ability to retain the
service of these individuals, who are not obligated to remain
employed by the Manager, and recruit successfully, is a significant
factor in the success of the Company.
The Company's risk exposure as a result of the impacts from the
Russia-Ukraine conflict and the sanctions imposed on Russia after
the reporting date have been reviewed and the Company has minimal
direct exposure. The political and economic situation is being
monitored.
COVID-19
The continuation of the COVID-19 pandemic has given rise to
challenges for businesses across the globe and during the year the
Board maintained its focus on the impact of the crisis on the
performance of the Company. The crisis management and business
continuity protocols of the Manager remained effectively invoked
and have provided a robust framework to support continuity.
Risk appetite and tolerance
The Board acknowledges and recognises that in the normal course
of business, the Company is exposed to risk and that it is willing
to accept a certain level of risk in managing the business to
achieve its targeted returns. The Board's risk appetite framework
provides a basis for the ongoing monitoring of risks and enables
dialogue with respect to the Company's current and evolving risk
profile, allowing strategic and financial decisions to be made on
an informed basis.
The Board considers several factors to determine its acceptance
for each principal risk and categorises acceptance for each risk as
low, moderate and high. Where a risk is approaching or is outside
the tolerance set, the Board will consider the appropriateness of
actions being taken to manage the risk. In particular, the Board
has a lower tolerance for financing risk with the aim to ensure
that even under a stress scenario, the Company is likely to meet
its funding requirements and financial obligations. Similarly, the
Board has a low risk tolerance concerning operational risks
including legal, tax, and regulatory compliance and business
process and continuity risk.
Risk management framework
The Board is responsible for risk management and determining the
Company's overall risk appetite. The Audit Committee assesses and
monitors the risk management framework and specifically reviews the
controls and assurance programmes in place.
How we manage and mitigate our key risks
RISK IMPACT MITIGATION CHANGE IN THE YEAR
Investment Risks
------------------------------------------------------------
Investment performance The Manager has a strong track record of investing in private Stable
The Manager selects the fund investments and direct Poor origination, investment selection and monitoring equity through multiple economic cycles. The Manager has a The Board is responsible for ensuring that the investment
Co-investments for the Company's Portfolio. The underlying by the Manager and/or third-party managers which may highly selective investment approach and disciplined process, policy is met. The day-to-day management of the Company's
managers of those funds in turn select individual have a negative impact on Portfolio performance. which is overseen by ICG Enterprise Trust's Investment assets is delegated to the Manager under investment
investee companies. The origination, investment selection Committee within the Manager, which comprises a balance of guidelines determined by the Board. The Board regularly
and management capabilities of both the Manager and skills and perspectives. Further, the Company's Portfolio is reviews these guidelines to ensure they remain appropriate
the third-party managers are key to the performance diversified, reducing the likelihood of a single investment and monitors compliance with the guidelines through
of the Company decision impacting Portfolio performance. regular reports from the Manager, including performance
reporting. The Board also reviews the investment strategy
at least annually.
Following this assessment and other considerations,
the Board concluded that performance risk has remained
stable during the year.
Valuation Stable
In valuing its investments in private equity funds Incorrect valuations being provided would lead to The Manager carries out a formal valuation process The Board regularly reviews and discusses the valuation
and unquoted companies and publishing its NAV, the an incorrect overall NAV. involving a quarterly review of third-party valuations. process in detail with the Manager, including the
Company relies to a significant extent on the accuracy This includes a comparison of unaudited valuations sources of valuation information and methodologies
of financial and other information provided by the to latest audited reports, as well as a review of used.
underlying managers to the Manager. There is the potential any potential adjustments that are required to ensure Following this assessment and other considerations,
for inconsistency in the valuation methods adopted the valuation of the underlying investments are in the Board concluded that there was no material change
by the managers of these funds and companies and for accordance with the fair market value principles required in valuation risk during the year.
valuations to be misstated. under International Financial Reporting Standards
('IFRS').
External
Political and macro-economic uncertainty Increasing
Political and macro-economic uncertainty and other Changes in the political or macro-economic environment The Manager uses a range of complementary approaches The Board monitors and reviews the potential impact
global events, such as pandemics, that are outside could significantly affect the performance of existing to inform strategic planning and risk mitigation, on the Company from political and economic developments
of the Company's control could adversely impact the investments (and valuations) and prospects for realisations. including active investment management, profitability on an ongoing basis, including input and discussions
environment in which the Company and its investment In addition, it could impact the number of credible and balance sheet scenario planning and stress testing with the Manager.
portfolio companies operate. investment opportunities the Company can originate. to ensure resilience across a range of outcomes. Incorporating these views and other considerations,
The process is supported by a dedicated in-house economist the Board concluded that there was an increase in
and professional advisers where appropriate, to ensure political and macro-economic uncertainty risk as a
it is prepared for any potential impacts (to the extent result of the conflict in Ukraine.
possible).
Climate change Increasing
The underlying managers of the fund investments and Climate-related transition risks, driven in particular The Manager has a well-defined, firm-wide Responsible Wider society's focus on this risk has increased,
direct Co-investments in the Company's Portfolio fail by abrupt shifts in the political and technological Investing Policy and ESG framework in place. however we believe that climate change has yet to
to ensure that their portfolio companies respond to landscape, impact the value of the Company's Portfolio. A tailored ESG framework applies across all stages be fully priced in by financial markets. Delays in
the emerging threats from climate change. of the Company's investment process. This includes responding to climate risk could lead to potentially
ongoing monitoring of the underlying manager's ESG large and unanticipated shifts in valuations for impacted
reporting. industries and sectors.
During the year the Board received reports on the
implementation of the Manager's Responsible Investment
Policy.
Private equity sector Stable
The private equity sector could fall out of favour A change in sentiment to the sector has the potential Private equity continues to outperform public markets The Board receives regular updates from the Company's
with investors leading to a reduction in demand for to damage the Company's reputation and impact over the long term and has proved to be an attractive broker and is kept informed of all material discussions
the Company's shares. the performance of the Company's share price and widen asset class through various cycles. The Manager is with investors and analysts.
the Discount the shares trade at relative to NAV per active in marketing the Company's shares to a wide Incorporating these updates and other considerations,
Share, causing shareholder dissatisfaction. variety of investors to ensure the market is informed the Board concluded that there was no material change
about the Company's performance and investment proposition. in private equity sector sentiment risk during the
The Board monitors the Discount to NAV and considers year.
appropriate solutions to address any ongoing or substantial
Discount to NAV, including share buybacks.
Foreign exchange Stable
The Company has continued to expand its geographic At present, the Company does not hedge its foreign The Board regularly reviews the Company's exposure The Board reviewed the Company's exposure to currency
diversity by making investments in different countries. exchange exposure. Therefore, movements in exchange to currency risk and reconsiders possible Hedging risk and possible Hedging strategies and concluded
Accordingly, several investments are denominated in rates between these currencies may have a material strategies on at least an annual basis. that there was no material change in foreign exchange
US dollars, euros and currencies other than sterling. effect on the underlying valuations of the investments Furthermore, the Company's multicurrency bank facility risk during the year and that it remains appropriate
and performance of the Company. permits the borrowings to be drawn in euros and US for the Company not to hedge its foreign exchange
dollars, if required. exposure.
Operational Risks
------------------------------------------------------------
Regulatory, legislative Stable
and taxation compliance The failure of the Manager and the Company to comply The Board is responsible for ensuring the Company's The Company remains responsive to a wide range of
Failure by the Manager to comply with relevant regulation with the rules of professional conduct and relevant compliance with all applicable regulatory, legal and developing regulatory areas; and will continue to
and legislation could have an adverse impact on the laws and regulations could expose the Company to regulatory tax requirements. Monitoring of this compliance has enhance its processes and controls in order to remain
Company. Additionally, adherence to changes in the sanction and penalties as well as significant damage been delegated to the Manager, of which the in-house compliant with current and expected legislation.
legal, regulatory and tax framework applicable to to its reputation. Legal, Compliance and Risk functions provide regular The Board concluded that there was no material change
the Manager could become onerous, lessening competitive updates to the Board covering relevant changes to in respect of regulatory, legal and tax risk.
or market opportunities. regulation
and legislation.
The Board and the Manager continually monitor regulatory,
legislative and tax developments to ensure early engagement
in any areas of potential change.
People Stable
Loss of key professionals at the Manager could impair If the Manager's team is not able to deliver its objectives, The Manager regularly updates the Board on team developments The Board reviewed the Company's exposure to people
the Company's ability to deliver its investment strategy investment opportunities could be missed or misevaluated, and succession planning. The Manager places significant risk and concluded that the Manager continues to operate
and meet its external obligations if replacements while existing investment performance may suffer. focus on: sustainable succession, competitive remuneration and
are not found in a timely manner. -- Developing key individuals to ensure that there is a retention plans.
pipeline of potential succession candidates The Board believes that the risk in respect of people
internally. External appointments are considered if remains stable.
that best satisfies the business needs.
-- A team-based approach to investment decision-making
i.e., no one investment professional has sole
responsibility for an investment or fund manager
relationship.
-- Sharing insights and knowledge widely across the
investment team, including discussing all potential
new investments and the overall performance of the
Portfolio.
-- Designing and implementing a compensation policy that
helps to minimise turnover of key people.
Information security Application of the Manager's and Administrator's information Stable
The Company is dependent on effective information The failure of the Manager and Administrator to deliver security policies is supported by a governance structure and a In order to gain a more comprehensive understanding
technology systems at both the Manager and Administrator. an appropriate information security platform for critical risk framework that allow for the identification, control and of the Manager's internal controls and risk management
These systems support key business functions and are technology systems could result in unauthorised access mitigation of technology risks. The effectiveness of the systems the Board carries out a formal annual assessment
an important means of securing data and sensitive by malicious third parties, breaching the confidentiality, framework is periodically assessed. Additionally, the Manager's (supported by the Manager's internal audit function).
information. integrity and availability of Company data, negatively and Administrator's technology environments are continually In response to the continued heightened risk of cyber
impacting the Company's reputation. maintained and subject to regular testing, such as penetration security as a result of the COVID-19 pandemic, the
testing, vulnerability scans and patch management. Manager implemented several initiatives to further
protect against the prevention and leakage of sensitive
data.
Following this review and other considerations, the
Board concluded that there was no material change
in information security risk during the year.
The manager and third-party providers (including business The performance of the Manager, the Administrator, the Stable
processes and continuity) The Company is dependent Failure by a third-party provider to deliver services Depositary and other third-party providers is subject to In order to gain a more comprehensive understanding
on third parties for the provision of services and in accordance with its contractual obligations could regular review and reported to the Board. The Manager, the of the Manager's internal controls and risk management
systems, especially those of the Manager, the Administrator disrupt or compromise the functioning of the Company. Administrator and the Depositary produce internal control systems the Board carries out a formal annual assessment
and the Depositary. A material loss of service could result in, among reports to provide assurance regarding the effective operation (supported by the Manager's internal audit function).
other things, an inability to perform business critical of internal controls. These reports are provided to the Audit The Board also received regular reporting from the
functions, financial loss, legal liability, regulatory Committee for review. The Committee would seek further Manager and other third parties, setting out the measures
censure and reputational damage. representations from service providers if not satisfied with that they have put in place to address the COVID-19
the effectiveness of their control environment. The Audit pandemic crisis, in addition to their existing business
Committee formally assesses the internal controls of the continuity framework.
Manager, the Administrator and Depositary on an annual basis to Having considered these arrangements and reviewed
ensure adequate controls are in place. The assessment in service levels since the crisis has evolved, the Board
respect of the current year is discussed in the Report of the is confident that a good level of service has been
Audit Committee within the Annual Report. The Management and will be maintained.
Agreement and agreements with other third-party service Following this review and other considerations, the
providers are subject to notice periods that are designed to Board concluded that there was no material change
provide the Board with adequate time to put in place in the Manager and other third-party advisers' risk
alternative arrangements. during the year.
Financial Risks
------------------------------------------------------------
Financing Stable
The Company has outstanding Commitments that may be If the Company encountered difficulties in meeting The Manager monitors the Company's liquidity, overcommitment Following a reduction of the financing risk exposure
drawn down at any time in excess of total liquidity its outstanding Commitments, there would be significant ratio and covenants on a frequent basis, and undertakes the previous year to reflect the signing of the Company's
to private equity funds. The ability to fund this reputational damage as well as risk of damages being cash flow monitoring, and provides regular updates new credit facility that matures in February 2026,
difference is dependent on receiving cash proceeds claimed from managers and other counterparties. on these activities to the Board the Board concluded that there was no material change
from investments (the timing of which are unpredictable) in financing risk.
and the availability of financing facilities.
FINANCIAL STATEMENTS
Income statement
Year to 31 January 2022 Year to 31 January 2021
Revenue Revenue
return Capital return return Capital return
Notes GBP'000 GBP'000 GBP'000 GBP'000
-------- ----------------- -------- -----------------
Total Total
GBP'000 GBP'000
------------------ -------- ----------------- ------------ -------- ----------------- ------------
Investment returns
Income, gains and
losses on
investments 5,501 240,030 245,531 6,523 184,071 190,594
Deposit interest 2 -- 2 26 -- 26
Other income -- -- -- 45 -- 45
Foreign exchange
gains and losses -- (980) (980) -- (799) (799)
------------------ -------- ----------------- ------------ -------- ----------------- ------------
5,501 239,050 244,553 6,594 183,272 189,866
-------- ----------------- ------------ -------- ----------------- ------------
Expenses
Investment
management
charges (1,342) (12,075) (13,417) (2,682) (8,046) (10,728)
Other expenses (2,383) (2,263) (4,646) (2,129) (1,941) (4,070)
------------------ -------- ----------------- ------------ -------- ----------------- ------------
(3,725) (14,338) (18,063) (4,811) (9,987) (14,798)
-------- ----------------- ------------ -------- ----------------- ------------
Profit/(loss)
before tax 1,778 224,712 226,490 1,783 173,285 175,068
-------- ----------------- ------------ -------- ----------------- ------------
Taxation - - - - - --
------------------ -------- ----------------- ------------ -------- ----------------- ------------
Profit/(loss) for
the period 1,778 224,712 226,490 1,783 173,285 175,068
-------- ----------------- ------------ -------- ----------------- ------------
Attributable to:
------------------ -------- ----------------- ------------ -------- ----------------- ------------
Equity
shareholders 1,778 224,712 226,490 1,783 173,285 175,068
------------------ -------- ----------------- ------------ -------- ----------------- ------------
Basic and diluted 329.97p 254.53p
earnings per
share
------------------ -------- ----------------- ------------ -------- ----------------- ------------
The columns headed 'Total' represent the income statement for
the relevant financial years and the columns headed 'Revenue
return' and 'Capital return' are supplementary information, in line
with the Statement of Recommended Practice for Financial Statements
of Investment Trust Companies and Venture Capital Trusts issued by
the Association of Investment Companies. There is no Other
Comprehensive Income.
The notes on pages 31 to 36 are an integral part of the
condensed financial statements.
Balance sheet
31 January 31 January
2022 2021
Notes GBP'000 GBP'000
----------------------------------------------- ------ ----------- -----------
Non-current assets
Investments held at fair value 7 1,123,747 907,562
Current assets
Cash and cash equivalents 41,328 45,143
Receivables 2,205 162
----------------------------------------------- ------ ----------- -----------
43,533 45,305
----------- -----------
Current liabilities
Payables 9,303 851
Net current assets 34,230 44,454
----------------------------------------------- ------ ----------- -----------
Total assets less current liabilities 1,157,977 952,016
----------- -----------
Capital and reserves
Share capital 7,292 7,292
Capital redemption reserve 2,112 2,112
Share Premium 12,936 12,936
Capital reserve 1,135,637 929,676
Revenue reserve -- --
----------------------------------------------- ------ ----------- -----------
Total equity 1,157,977 952,016
----------------------------------------------- ------ ----------- -----------
1,690.1p
Net Asset Value per Share (basic and diluted) 6 1,384.4p
----------------------------------------------- ------ ----------- -----------
The notes on pages 31 to 36 are an integral part of the
condensed financial statements.
Cash flow statement
Year to Year to
31 January 2022 31 January 2021
GBP'000 GBP'000
------------------------------------------ ---------------- ----------------
Operating activities
Sale of Portfolio investments 100,982 147,545
Purchase of Portfolio investments (75,125) (86,134)
Net cash flows to subsidiary investments (2,524) (6,486)
Interest income received from Portfolio
investments 3,647 1,231
Dividend income received from Portfolio
investments 1,854 5,445
Other income received 2 71
Investment management charges paid (6,207) (10,334)
Other expenses paid (1,570) (1,419)
------------------------------------------ ---------------- ----------------
Net cash inflow/(outflow) from operating
activities 21,059 49,919
------------------------------------------ ---------------- ----------------
Financing activities
Bank facility fee (3,318) (1,410)
Interest paid (50) (440)
Purchase of own shares into treasury (2,679) (775)
Credit Facility utilised - 40,000
Credit Facility repaid - (40,000)
Equity dividends paid to shareholders (17,849) (15,822)
Net cash outflow from financing activities (23,896) (18,447)
------------------------------------------ ---------------- ----------------
Net increase/(decrease) in cash and cash
equivalents (2,837) 31,472
------------------------------------------ ---------------- ----------------
Cash and cash equivalents at beginning of
period 45,143 14,470
Net increase/(decrease) in cash and cash
equivalents (2,837) 31,472
Effect of changes in foreign exchange
rates (978) (799)
------------------------------------------ ---------------- ----------------
Cash and cash equivalents at end of period 41,328 45,143
------------------------------------------ ---------------- ----------------
The notes on pages 31 to 36 are an integral part of the
condensed financial statements.
Statement of changes in equity
Total
Capital redemption Capital Revenue shareholders'
Share capital reserve Share Premium reserve reserve equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- -------------- ------------------------ -------------- --------- -------- --------------
Full year to
31 January 2022
Opening balance at 1 February
2021 7,292 2,112 12,936 929,676 - 952,016
Profit for the period and total
comprehensive income -- -- -- 224,712 1,778 226,490
Dividends paid -- -- -- (16,071) (1,778) (17,849)
Purchase of own shares into
treasury -- -- -- (2,679) -- (2,679)
-------------------------------- -------------- ------------------------ -------------- --------- -------- --------------
Closing balance
at 31 January 2022 7,292 2,112 12,936 1,135,637 -- 1,157,977
-------------------------------- -------------- ------------------------ -------------- --------- -------- --------------
Total
Capital redemption Capital Revenue shareholders'
Share capital reserve Share Premium reserve reserve equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------- -------------- ------------------------ -------------- -------- -------- --------------
Full year to
31 January 2021
Opening balance at 1 February
2020 7,292 2,112 12,936 771,205 -- 793,545
Profit for the period and total
comprehensive income -- -- -- 173,285 1,783 175,068
Dividends paid -- -- -- (14,039) (1,783) (15,822)
Purchase of own shares into
treasury -- -- -- (775) -- (775)
-------------------------------- -------------- ------------------------ -------------- -------- -------- --------------
Closing balance
at 31 January 2021 7,292 2,112 12,936 929,676 -- 952,016
-------------------------------- -------------- ------------------------ -------------- -------- -------- --------------
The notes on pages 31 to 36 are an integral part of the
condensed financial statements.
NOTES TO THE FINANCIAL STATEMENTS
For the period ended 31 January 2022
1. General information
These financial statements relate to ICG Enterprise Trust Plc
('the Company'). ICG Enterprise Trust Plc is registered in England
and Wales and is incorporated in the United Kingdom. The Company is
domiciled in the United Kingdom and its registered office is
Procession House, 55 Ludgate Hill, London EC4M 7JW. The Company's
objective is to provide long-term growth by investing in private
companies managed by leading private equity managers.
2. Financial information
The financial information for the year ended 31 January 2022 has
been extracted from the statutory accounts for that year and do not
comprise statutory accounts within the meaning of section 434 of
the Companies Act 2006. The report of the auditors on those
accounts was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statements under section 498(2)
or (3) of the Companies Act 2006. Statutory accounts for that year
will be delivered to the Registrar of Companies following the
Company's Annual General Meeting which will be held on 28 June
2022.
The financial information for the year ended 31 January 2021 has
been extracted from the statutory accounts for that year which were
approved by the Board on 27 April 2021 and delivered to the
Registrar of Companies. The report of the auditors on those
accounts was unqualified, did not contain an emphasis of matter
paragraph and did not contain any statements under section 498(2)
or (3) of the Companies Act 2006.
3. Basis of preparation
The financial information for the year ended 31 January 2022 has
been prepared in accordance with International Accounting Standards
('IAS') in conformity with the requirements of the Companies Act
2006 and the Statement of Recommended Practice ('SORP') for
investment trusts issued by the Association of Investment Companies
in October 2019.
IAS comprises standards and interpretations approved by the
International Accounting Standards Board ('IASB') and the IFRS
Interpretations Committee.
These financial statements have been prepared on a going concern
basis and on the historical cost basis of accounting, modified for
the revaluation of certain assets at fair value. The directors have
concluded that the preparation of the financial statements on a
going concern basis continues to be appropriate; the directors'
assessment is further detailed in the Report of the Directors.
Climate change
In preparing the financial statements, the Directors have
considered the impact of climate change, particularly in the
context of the climate change risks identified in the principal
risks section of the Strategic Report and the impact of
climate-change risk on the valuation of investments.
These considerations did not have a material impact on the
financial reporting judgements and estimates in the current year,
nor were they expected to have a significant impact on the Group's
going concern or viability.
Accounting policies
The principal accounting policies adopted are set out below.
These policies have been applied consistently throughout the
current and prior year. In order to reflect the activities of an
investment trust company, supplementary information which analyses
the income statement between items of revenue and capital nature
has been presented alongside the income statement. In analysing
total income between capital and revenue returns, the directors
have followed the guidance contained in the SORP as follows:
-- Capital gains and losses on investments sold and on investments held
arising on the revaluation or disposal of investments classified as held
at fair value through profit or loss should be shown in the capital
column of the income statement.
-- Returns on any share or debt security for a fixed amount (whether in
respect of dividends, interest or otherwise) should be shown in the
revenue column of the income statement.
-- The Board should determine whether the indirect costs of generating
capital gains should also be shown in the capital column of the income
statement. If the Board decides that this should be so, the management
fee should be allocated between revenue and capital in accordance with
the Board's expected long-term split of returns, and other expenses
should be charged to capital only to the extent that a clear connection
with the maintenance or enhancement of the value of investments can be
demonstrated.
The accounting policy regarding the allocation of expenses is
set out in note 1(i).
In accordance with IFRS 10 (amended), the Company is deemed to
be an investment entity on the basis that:
(a) it obtains funds from one or more investors for the purpose
of providing investors with investment management services;
(b) it commits to its investors that its business purpose is to
invest funds for both returns from capital appreciation and
investment income; and
(c) it measures and evaluates the performance of substantially
all of its investments on a fair value basis.
As a result, the Company's controlled structured entities
('subsidiaries') are deemed to be investment entities and are
included in subsidiary investments classified as held at fair value
through profit and loss.
The Financial Conduct Authority and the Bank of England have
imposed significant interest rate benchmarking reform with LIBOR
publication ceasing on 31 December 2021. The Company has applied
the practical expedient as permitted under the transition rules.
The impact of this application was immaterial to the Company.
Investments
All investments are classified upon initial recognition as held
at fair value through profit or loss (described in these financial
statements as investments held at fair value) and are measured at
subsequent reporting dates at fair value. Changes in the value of
all investments held at fair value, which include returns on those
investments such as dividends and interest, are recognised in the
income statement and are allocated to the revenue column or the
capital column in accordance with the SORP (see note 1(a)). More
detail on certain categories of investment is set out below. Given
that the subsidiaries and associates are held at fair value and are
exposed to materially similar risks as the Company, we do not
expect the risks to materially differ from those disclosed in the
Annual Report.
Unquoted investments
Fund investments and Co-investments (collectively 'unquoted
investments') are fair valued using the net asset value of those
unquoted investments as determined by the investment manager of
those funds. The investment manager of the funds performs periodic
valuations of its underlying investments (typically using earnings
multiple or discounted cash flow methodologies to determine
Enterprise Value in line with International Private Equity
Valuation Guidelines) in line with fair value measurements. In the
absence of contrary information, these valuation methodologies are
deemed to be appropriate. A robust assessment is performed by the
Manager's experienced Investment Committee to determine the
capability and track record of the investment manager. All
investment managers are scrutinised by the Investment Committee and
an approval process is recorded before any new investment manager
is approved and an investment made. This level of scrutiny provides
reasonable comfort that the investment manager's valuation will be
consistent with the requirement to use fair value.
Adjustments may be made to the net asset values provided or an
alternative method may be deemed to be more appropriate. The most
common reason for adjustments is to take account of events
occurring after the date of the manager's valuation, and better
information becoming available, such as a realisation or a
significant macro-economic event.
Quoted investments
Quoted investments are held at the last traded bid price on the
balance sheet date. When a purchase or sale is made under contract,
the terms of which require delivery within the timeframe of the
relevant market, the contract is reflected on the trade date.
Subsidiary undertakings
The investments in the controlled structured entities
('subsidiaries') are recognised at fair value through profit and
loss.
The valuation of the subsidiaries takes into account an accrual
for the estimated value of interests in the Co-investment Incentive
Scheme. Under these arrangements, ICG and certain of its executives
and, in respect of certain historic investments, the executives and
connected parties of Graphite Capital Management LLP (the 'Former
Manager') (together 'the Co-investors'), are required to co-invest
alongside the Company, for which they are entitled to a share of
investment profits if certain performance hurdles are met. These
arrangements are discussed further in the Report of the Directors.
At 31 January 2022, the accrual was estimated as the theoretical
value of the interests if the Portfolio had been sold at the
carrying value at that date.
Associates
Investments which fall within the definition of an associate
under IAS 28 (Investments in associates) are accounted for as
investments held at fair value through profit or loss, as permitted
by that standard.
The Company holds an interest (including indirectly through its
subsidiaries) of more than 20% in a small number of investments
that may normally be classified as subsidiaries or associates.
These investments are not considered subsidiaries or associates as
the Company does not exert control or significant influence over
the activities of these companies/partnerships as they are managed
by other third parties.
NOTES TO THE FINANCIAL STATEMENTS
4. Dividends
Year ended Year ended
31 January 31 January
2022 2021
GBP'000 GBP'000
----------------------------------------------------------- -----------
Third quarterly dividend in respect of prior year
5p per share (2021: 5.0p per share) 3,438 3,444
Final dividend in respect of year ended 31 January
2021: 9p per share (2021: 8.0p) 6,189 5,502
--------------------------------------------------- ------ -----------
First quarterly dividend in respect of year ended
31 January 2022: 6.0p per share (2021: 5.0p) 4,111 3,438
--------------------------------------------------- ------ -----------
Second quarterly dividend in respect of year ended
31 January 2022: 6.0p per share (2021: 5.0p) 4,111 3,438
--------------------------------------------------- ------ -----------
17,849 15,822
--------------------------------------------------- ------ -----------
The Company paid a third quarterly dividend of 6.0p per share in
March 2022. The Board has proposed a final dividend of 9p per share
in respect of the year ended 31 January 2022 which, if approved by
shareholders, will be paid on 22 July 2022 to shareholders and on
the register of members at the close of business on 8 July
2022.
5. Earnings per share
Year ended Year ended
31 January 31 January
Earnings per share 2022 2021
Revenue return per ordinary share 2.59p 2.59p
Capital return per ordinary share 327.38p 251.93p
Earnings per ordinary share (basic and diluted) 329.97p 254.53p
------------------------------------------------ ----------- -----------
Weighted average number of shares 68,638,288 68,781,700
------------------------------------------------ ----------- -----------
The earnings per share figures are based on the weighted average
numbers of shares set out above.
During the year, 250,000 shares were bought back in the market
and held in treasury (31 January 2021: 110,000 shares). At 31
January 2022, the Company held 4,395,945 shares in treasury (31
January 2021: 4,145,945) leaving 68,517,055 (31 January 2021:
68,767,055) shares outstanding, all of which have equal voting
rights.
6. Net Asset Value per Share
The Net Asset Value per Share is calculated as the net assets
attributable to shareholders of GBP1,158.0m (31 January 2021:
GBP952.0m) and 68,517,055 (31 January 2021: 68,767,055) ordinary
shares in issue at the period end. There were no potentially
dilutive ordinary shares, such as options or warrants, at either
year end. Calculated on both the basic and diluted basis, the Net
Asset Value per Share was 1,690.1p (31 January 2021: 1,384.4p).
NOTES TO THE FINANCIAL STATEMENTS
7. Fair Value estimation
IFRS 13 requires disclosure of fair value measurements of
financial instruments categorised according to the following fair
value measurement hierarchy:
-- Quoted prices (unadjusted) in active markets for identical assets or
liabilities (level 1).
-- Inputs other than quoted prices included within level 1 that are
observable for the asset or liability, either directly (that is, as
prices) or indirectly (that is, derived from prices) (level 2).
-- Inputs for the asset or liability that are not based on observable market
data (that is, unobservable inputs) (level 3).
The valuation techniques applied to level 1 and level 3 assets
are described in note 1 of the annual financial statements. No
investments were categorised as level 1 or level 2.
The following tables present the assets that are measured at
fair value at 31 January 2022 and 31 January 2021. The Company had
no financial liabilities measured at fair value at those dates.
Level 1 Level 2 Level 3 Total
31 January 2022 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------- -------- -------- --------- ---------
Investments held at fair
value
Unquoted investments(1) -- -- 140,060 140,060
Quoted investments -- -- 61,949 61,949
Subsidiary undertakings(1) -- -- 921,738 921,738
---------------------------- --------- --------- --------- ---------
Total investments held at
fair value -- -- 1,123,747 1,123,747
---------------------------- --------- --------- --------- ---------
Level 1 Level 2 Level 3 Total
31 January 2021 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------ ------- ------- ------- -------
Investments held at fair value
Unquoted investments -- -- 604,306 604,306
Quoted investments 35,702 -- -- 35,702
Subsidiary undertakings -- -- 267,554 267,554
------------------------------------ ------- ------- ------- -------
Total investments held at fair value 35,702 -- 871,860 907,562
------------------------------------ ------- ------- ------- -------
(1) On 26 February 2021, the Company finalised a new bank facility of EUR200m (GBP177m, translated at the rate prevailing on the day the facility became available for use) with Credit Suisse. The facility was agreed to strengthen the Company's financial position and replace the previous facility that was in place at the year end. The new facility requires at least GBP500m of investments be held in a single entity in order to provide security for the facility. To meet this criteria, a new subsidiary of the Company, ET Holdings LP, was incorporated on 15 December 2020. During February and March 2021, the Company completed a number of transfers of its investments, as well as transfers of investments from the Company's subsidiary ICG Enterprise Trust Co-investment LP, to ET Holdings LP. In addition, during the year to 31 January 2022, ET Holdings LP entered into a number of new investments in its own right. The fair value of investments held in ET Holdings LP as at 31 January 2022 is GBP750.5m.
All quoted and unquoted investments are measured in accordance
with IFRS 9.
NOTES TO THE FINANCIAL STATEMENTS
7. Fair Value estimation (continued)
Investments in level 3 securities are in respect of Third Party
Funds and Direct Investments. These are held at fair value and are
calculated using valuations provided by the underlying manager of
the investment and reviewed by ICG, with adjustments made to the
statements to take account of cash flow events occurring after the
date of the manager's valuation, such as realisations or liquidity
adjustments. The valuations of unquoted investments provided by
underlying managers are calculated in accordance with the 2018 IPEV
Guidelines, which primarily use earnings multiple methodology. A
30% increase/(decrease) in the value of these assets (including
those assets held within subsidiary undertakings) would result in a
rise and fall in NAV of GBP319.4m and GBP331.0 or 27.6% and 28.6%
respectively (31 January 2021: rise and fall in NAV of GBP252.0m
and GBP254.8m respectively or 26.5% and 26.8%).
The following tables present the changes in level 3 instruments
for the periods to 31 January 2022 and 31 January 2021.
Year ended Year ended
31 January 2022 31 January 2021
GBP'000 GBP'000
------------------------------------------ ---------------- ----------------
Opening Balance 1 February 871,860 777,185
Additions 77,649 92,620
Disposals (65,280) (146,288)
Gains and losses recognised in profit or
loss 239,517 148,383
------------------------------------------ ---------------- ----------------
Closing balance 1,123,747 871,860
------------------------------------------ ---------------- ----------------
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The directors are responsible for preparing the Annual Report,
the Directors' Remuneration Report and the financial statements in
accordance with applicable law and regulations.
Company law requires the directors to prepare financial
statements for each financial year. Accordingly, the directors have
prepared the financial statements in accordance with International
Accounting Standards in conformity with the requirements of the
Companies Act 2006. Company law also requires that the directors do
not approve the financial statements unless they are satisfied that
they give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for the relevant
period. In preparing these financial statements, the directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and prudent;
-- state whether International Accounting Standards in conformity with the
requirements of the Companies Act 2006, have been followed, subject to
any material departures disclosed and explained in the financial
statements; and
-- prepare the financial statements on a going concern basis unless it is
inappropriate to presume that the Company will continue in business.
The directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the financial statements and the Directors' remuneration report
comply with the Companies Act 2006 and, as regards the Company's
financial statements, International Accounting Standards in
conformity with the requirements of the Companies Act 2006 and the
Statement of Recommended Practice ('SORP') for investment trusts
issued by the Association of Investment Companies in October 2019.
The directors are also responsible for safeguarding the assets of
the Company and for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
The directors are responsible for the maintenance and integrity
of the Company's website. Legislation in the United Kingdom
governing the preparation and dissemination of financial statements
may differ from legislation in other jurisdictions.
Having taken advice from the Audit Committee, the directors
consider that the Annual Report, taken as a whole, is fair,
balanced and understandable and provides the information necessary
for shareholders to assess the Company's position and performance,
business model and strategy.
Each of the directors confirm that, to the best of their
knowledge:
-- the financial statements, which have been prepared in accordance with
International Accounting Standards in conformity with the requirements of
the Companies Act 2006, give a true and fair view of the assets,
liabilities, financial position and profit of the Company; and
-- the Strategic Report includes a fair review of the development and
performance of the business and the position of the Company, together
with a description of the principal risks and uncertainties that it
faces.
On behalf of the Board
Jane Tufnell
Chair
12 May 2022
GLOSSARY (UNAUDITED)
Term
Short form
Definition
Alternative Performance Measures
APMs
Alternative Performance Measures are a term defined by the
European Securities and Markets Authority as "financial measures of
historical or future performance, financial position, or cash
flows, other than a financial measure defined or specified in the
applicable financial reporting framework".
APMs are used in this report if considered by the Board and the
Manager to be the most relevant basis for shareholders in assessing
the overall performance of the Company and for comparing the
performance of the Company to its peers, taking into account
industry practice.
Definitions and reconciliations to IFRS measures are provided in
the main body of the report or in this Glossary, where
appropriate.
Carried interest
Carried interest is equivalent to a performance fee. This
represents a share of the profits that will accrue to the
underlying private equity managers, after achievement of an agreed
Preferred Return.
Co-investment
Co-investment is a Direct Investment in a company alongside a
private equity fund.
Co-investment Incentive Scheme Accrual
Co-investment Incentive Scheme Accrual represents the estimated
value of interests in the Co-investment Incentive Scheme operated
by the subsidiary partnerships of the Company.
Commitment
Commitment represents the amount of capital that each Limited
Partner agrees to contribute to the fund, which can be drawn at the
discretion of the General Partner.
Deployment
Please see 'Total new investment'.
Direct Investments
Please see 'Co-investment'.
Discount
Discount arises when the Company's shares trade at a price below
the Company's NAV per Share. In this circumstance, the price that
an investor pays or receives for a share would be less than the
value attributable to it by reference to the underlying assets. The
Discount is the difference between the share price and the NAV,
expressed as a percentage of the NAV. For example, if the NAV was
100p and the share price was 90p, the Discount would be 10%.
Drawdowns
Drawdowns are amounts invested by the Company into funds when
called by underlying managers in respect of an existing
Commitment.
EBITDA
Stands for earnings before interest, tax, depreciation and
amortisation, which is a widely used performance measure in the
private equity industry.
Enterprise Value
EV
Enterprise Value is the aggregate value of a company's entire
issued share capital and Net Debt.
Exclusion List
The Exclusion List defines the business activities which are
excluded from investment.
FTSE All-Share Index Total Return
The change in the level of the FTSE All-Share Index, assuming
that dividends are re- invested on the day that they are paid.
Full Exits
Full Exits are exit events (e.g., trade sale, sale by public
offering, or sale to a financial buyer) following which the
residual exposure to an underlying company is zero or immaterial;
this does not include Fund Disposals. See 'Fund Disposals'.
Fund Disposals
Fund Disposals are where the Company receives sales proceeds
from the full or partial sale of a fund position within the
secondary market.
General Partner
GP
The General Partner is the entity managing a private equity
fund. This is commonly referred to as the manager.
Hedging
Hedging is an investment technique designed to offset a
potential loss on one investment by purchasing a second investment
that is expected to perform in the opposite way.
High Conviction Investments
High Conviction Investments comprise Direct Investments, as well
as investments in ICG-managed funds and Secondary Investments.
Initial Public Offering
IPO
An Initial Public Offering is an offering by a company of its
share capital to the public with a view to seeking an admission of
its shares to a recognised stock exchange.
Internal Rate of
Return
IRR
Internal Rate of Return is a measure of the rate of return
received by an investor in a fund. It is calculated from cash drawn
from and returned to the investor, together with the residual value
of the investment.
Investment Period
Investment Period is the period in which funds are able to make
new investments under the terms of their fund agreements, typically
up to five years after the initial Commitment.
Last Twelve Months
LTM
Last Twelve Months refers to the time frame of the immediately
preceding 12 months in reference to a financial metricised to
evaluate the Company's performance.
Limited Partner
LP
The Limited Partner is an institution or individual who commits
capital to a private equity fund established as a Limited
Partnership. These funds are generally protected from legal actions
and any losses beyond the original investment.
Limited Partnership
A Limited Partnership includes one or more General Partners, who
have responsibility for managing the business of the partnership
and have unlimited liability, and one or more Limited Partners, who
do not participate in the operation of the partnership and whose
liability is ordinarily capped at their capital and loan
contribution to the partnership. In typical fund structures, the
General Partner receives a priority share ahead of distributions to
Limited Partners.
Net Asset Value
per Share
NAV per Share
Net Asset Value per Share is the value of the Company's net
assets attributable to one Ordinary share. It is calculated by
dividing 'shareholders' funds' by the total number of ordinary
shares in issue. Shareholders' funds are calculated by deducting
current and long-term liabilities, and any provision for
liabilities and charges, from the Company's total assets.
Net Asset Value
per Share Total
Return
Net Asset Value per Share Total Return is the change in the
Company's Net Asset Value per Share, assuming that dividends are
re- invested at the end of the quarter in which the dividend was
paid.
Net Debt
Net Debt is calculated as the total short-term and long-term
debt in a business, less cash and cash equivalents.
Ongoing Charges
Ongoing Charges are calculated in line with guidance issued by
the Association of Investment Companies ('AIC') and capture
management fees and expenses, excluding finance costs, incurred at
the Company level only. The calculation does not include the
expenses and management fees incurred by any underlying funds.
Amount
excluded from Included
AIC ongoing ongoing
Total per income charges charges
FY22 statement GBP,000 GBP'000 GBP'000
------------------------- ------------------------ -------------- ---------
Management fees 13,417 -- 13,417
General expenses 2,082 491 1,591
------------------------- ------------------------ -------------- ---------
Finance costs 2,565 2,565 -
------------------------- ------------------------ -------------- ---------
Total 18,064 3,056 15,008
------------------------- ------------------------ -------------- ---------
Total Ongoing Charges 15,008
------------------------- ------------------------ -------------- ---------
Average NAV 1,070,494
------------------------- ------------------------ -------------- ---------
Ongoing Charges as % of
NAV 1.4%
------------------------- ------------------------ -------------- ---------
The amount of general expenses excluded from AIC ongoing charges
includes GBP234,000 of legal and professional costs incurred in
connection with the bank facility, as finalised with Credit Suisse
during February 2021.
Amount
excluded from Included
AIC ongoing ongoing
Total per income statement charges charges
FY21 GBP,000 GBP'000 GBP'000
------------------------ -------------------------- -------------- --------
Management fees 10,728 - 10,728
General expenses 1,447 8 1,439
------------------------ -------------------------- -------------- --------
Finance costs 2,623 2,623 -
------------------------ -------------------------- -------------- --------
Total 14,798 2,631 12,167
------------------------ -------------------------- -------------- --------
Total Ongoing Charges 12,167
------------------------ -------------------------- -------------- --------
Average NAV 834,566
------------------------ -------------------------- -------------- --------
Ongoing Charges as % of
NAV 1.5%
------------------------ -------------------------- -------------- --------
Other Net Liabilities
Other Net Liabilities at the aggregated Company level represent
net other liabilities per the Company's balance sheet. Net other
liabilities per the balance sheet of the subsidiaries are amounts
payable under the Co-investment Incentive Scheme Accrual.
Overcommitment
Overcommitment refers to where private equity fund investors
make Commitments exceeding the amount of cash immediately available
for investment. When determining the appropriate level of
Overcommitment, careful consideration needs to be given to the rate
at which Commitments might be drawn down, and the rate at which
realisations will generate cash from the existing Portfolio to fund
new investment.
Portfolio
Portfolio represents the aggregate of the investment Portfolios
of the Company and of its subsidiary Limited Partnerships. This APM
is consistent with the commentary in previous annual and interim
reports. The Board and the Manager consider that disclosing our
Portfolio assists shareholders in understanding the value and
performance of the underlying investments selected by the Manager.
It is shown before the Co-investment Incentive Scheme Accrual to
avoid being distorted by certain funds and Direct Investments on
which ICG Enterprise Trust Plc does not incur these costs (for
example, on funds managed by ICG plc). Portfolio is related to the
NAV, which is the value attributed to our shareholders, and which
also incorporates the Co-investment Incentive Scheme Accrual as
well as the value of cash retained on our balance sheet.
The value of the Portfolio at 31 January 2022isGBP1,172.2m
(2021: GBP949.2m).
Portfolio (continued)
The closest equivalent amount reported on the balance sheet is
'investments at fair value'. A reconciliation of these two measures
along with other figures aggregated for the Company and its
subsidiary Limited Partnerships is presented below:
Total Company
Net assets Co-investment and
IFRS Balance of subsidiary Incentive subsidiary
31 January 2022 sheet fair limited Scheme Limited
GBPm value partnerships Accrual Partnerships
--------------- -------------- -------------- -------------- -------------
Investments(1) 1,123.7 (0.6) 49.1 1,172.2
Cash 41.3 - - 41.3
Other Net
Liabilities (7.1) 0.6 (49.1) (55.6)
--------------- -------------- -------------- -------------- -------------
Net assets 1,157.9 - - 1,157.9
--------------- -------------- -------------- -------------- -------------
Balances
receivable
from Co-investment Total Company
IFRS Balance subsidiary Incentive and subsidiary
31 January 2021 sheet fair Limited Scheme Limited
GBPm value Partnerships Accrual Partnerships
--------------- -------------- ------------- -------------- --------------
Investments(1) 907.6 (0.2) 41.8 949.2
Cash 45.2 - - 45.2
Other Net
Liabilities (0.7) 0.2 (41.8) (42.3)
--------------- -------------- ------------- -------------- --------------
Net assets 952.1 - - 952.1
--------------- -------------- ------------- -------------- --------------
(1) Investments as reported on the IFRS balance sheet at fair
value comprise the total of assets held by the Company and the net
asset value of the Company's investments in the subsidiary Limited
Partnerships.
Portfolio Return on a Local Currency Basis
Portfolio Return on a Local Currency Basis represents the change
in the valuation of the Company's Portfolio before the impact of
currency movements and Co-investment Incentive Scheme Accrual. The
Portfolio return of 29.4% is calculated as follows:
GBPm FY22 FY21
------------------------------------------------------ ----- ------
Income, gains and losses on Investments 245.5 190.6
Foreign exchange gains and losses included in gains
and losses on investments 17.2 (12.2)
Incentive accrual valuation movement 16.7 22.2
------------------------------------------------------ ----- ------
Total gains on Portfolio investments excluding impact
of foreign exchange 279.4 200.6
------------------------------------------------------ ----- ------
Opening Portfolio valuation 949.2 806.4
------------------------------------------------------ ----- ------
Portfolio Return on a Local Currency Basis 29.4% 24.9%
------------------------------------------------------ ----- ------
Term
Short form
Definition
Portfolio Return on a Local Currency Basis
(continued)
A reconciliation between the Portfolio Return on Local Currency
Basis and NAV per Share Total Return is disclosed under 'Total
Return'.
Portfolio Company
Portfolio Company refers to an individual company in an
investment portfolio.
Preferred Return
Preferred Return is the preferential rate of return on an
individual investment or a portfolio of investments, which is
typically 8% per annum.
Premium
Premium occurs when the share price is higher than the NAV and
investors would therefore be paying more than the value
attributable to the shares by reference to the underlying
assets.
Quoted Company
A Quoted Company is any company whose shares are listed or
traded on a recognised stock exchange.
Realisation Proceeds
Realisation Proceeds are amounts received in respect of
underlying realisation activity from the Portfolio and exclude any
inflows from the sale of fund positions via the secondary
market.
Realisations - Multiple to Cost
Realisations - Multiple to Cost is the average return from Full
Exits from the Portfolio in the period on a primary investment
basis, weighted by cost.
GBPm FY22 FY21
--------------------------------------------------- ----- ----
Cumulative Realisation Proceeds from Full Exits in
the year 211.5 85.7
Cost 108.1 35.6
--------------------------------------------------- ----- ----
Average return Multiple to Cost 2.6x 2.4x
--------------------------------------------------- ----- ----
Realisations -- Uplift To Carrying Value
Realisations -- Uplift To Carrying Value is the aggregate uplift
on Full exits from the Portfolio in the period excluding publicly
listed companies that were exited via sell downs of their
shares.
GBPm FY22 FY21
------------------------------------------------------ ----- ----
Realisation Proceeds from Full Exits in the year 210.5 78.0
Prior Carrying Value (at previous quarterly valuation
prior to exit) 154.4 59.7
------------------------------------------------------ ----- ----
Realisations -- Uplift To Carrying Value 36% 31%
------------------------------------------------------ ----- ----
Secondary Investments
Secondary Investments occur when existing private equity fund
interests and Commitments are purchased from an investor seeking
liquidity.
Share Price Total Return
Share Price Total Return is the change in the Company's share
price, assuming that dividends are re-invested on the day that they
are paid.
Total New Investment
Total New Investment is the total of direct Co-investment and
fund investment Drawdowns in respect of the Portfolio. In
accordance with IFRS 10, the Company's subsidiaries are deemed to
be investment entities and are included in subsidiary investments
within the financial statements.
Movements in the cash flow statement within the financial
statements reconcile to the movement in the Portfolio as
follows:
GBPm FY22 FY21
---------------------------------------------------------- ----- -----
Purchase of Portfolio investments per cash flow statement 75.1 86.1
Purchase of Portfolio investments within subsidiary
investments 228.8 53.1
Total New Investment 303.7 139.2
---------------------------------------------------------- ----- -----
Total Proceeds
Total Proceeds are amounts received by the Company in respect of
the Portfolio, which may be in the form of capital proceeds or
income such as interest or dividends. In accordance with IFRS 10,
the Company's subsidiaries are deemed to be investment entities and
are included in subsidiary investments within the financial
statements.
GBPm FY22 FY21
------------------------------------------------------ ----- -----
Sale of Portfolio investments per cash flow statement 101.0 147.5
Sale of Portfolio investments, interest received,
and dividends received within subsidiary investments 236.4 55.1
Interest income per cash flow statement 2.0 1.2
Dividend income per cash flow statement 1.6 5.4
------------------------------------------------------ ----- -----
Total Proceeds 342.9 209.2
------------------------------------------------------ ----- -----
Fund Disposals 9.4 71.9
------------------------------------------------------ ----- -----
Realisation Proceeds 333.5 137.3
------------------------------------------------------ ----- -----
Total Return
Total Return is a performance measure that assumes the notional
re-investment of dividends. This is a measure commonly used by the
listed private equity sector and listed companies in general.
The table below sets out the share price and the Net Asset Value
per Share growth figures for periods of one, three, five and ten
years to the balance sheet date on a Total Return basis:
Total Return performance in years to 31
January 2022 1 year 3 years 5 years 10 years
------------------------------------------ ------ ------- ------- --------
Net Asset Value per Share +24.4% +69.3% +114.2% +257.5%
Share price +27.1% +57.5% +94.9% +325.5%
FTSE All-Share Index +18.9% +21.7% +30.2% +104.4%
------------------------------------------ ------ ------- ------- --------
The table below shows the breakdown of the one-year Net Asset
Value per Share Total Return for the period:
Change in NAV (% of opening NAV) FY22 FY21
------------------------------------------------------- ------ ------
Portfolio Return on a Local Currency Basis 29.4% 24.9%
Currency movements on the Portfolio (1.8%) 1.5%
------------------------------------------------------- ------ ------
Portfolio return in sterling 27.6% 26.4%
Effect of cash drag (0.1%) 0.4%
------------------------------------------------------- ------ ------
Impact of net portfolio movement on net asset value 27.5% 26.8%
Expenses and other income (1.5%) (1.9%)
Incentive accrual valuation movement (1.8%) (2.8%)
------------------------------------------------------- ------ ------
Increase in Net Asset Value per Share before buy backs 24.2% 22.1%
Impact of share buy backs & dividend reinvestment 0.2% 0.4%
------------------------------------------------------- ------ ------
Net Asset Value per Share Total Return 24.4% 22.5%
------------------------------------------------------- ------ ------
Undrawn Commitments
Undrawn Commitments are Commitments that have not yet been drawn
down (please see 'Drawdowns').
Unquoted Company
An Unquoted Company is any company whose shares are not listed
or traded on a recognised stock exchange.
Valuation Multiples
Valuation Multiples are earnings (EBITDA), or revenue multiples
applied in determining the value of a business enterprise.
Venture Capital
Financing provided to a company in the earlier stages of its
lifecycle, either at the concept, start-up, or early stage of that
company's development.
(1) Being the sum of all ordinary dividends declared during
FY22, including the proposed final dividend, and the value of all
shares bought back during the year
(2) Weighted averages, based on contribution to Portfolio value
at 31 January 2022
(3) EBITDA growth rate excludes Ambassador Theatre Group (#19)
and European Camping Group (#25), for which prior year EBITDA was
negative (due to COVID-19 impacts)
(4) PetSmart/Chewy, Olaplex and MoMo were excluded from this
analysis as EBITDA growth is not a relevant metric for these
companies in the period
(END) Dow Jones Newswires
May 12, 2022 02:00 ET (06:00 GMT)
Copyright (c) 2022 Dow Jones & Company, Inc.
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