NBPE Interim Results and 31 August 2023 NAV Estimate
THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE,
PUBLICATION OR DISTRIBUTION IN OR INTO AUSTRALIA, CANADA, ITALY,
DENMARK, JAPAN, THE UNITED STATES, OR TO ANY NATIONAL OF SUCH
JURISDICTIONS |
26 September 2023
NB Private Equity Partners (NBPE), the $1.3bn, FTSE 250, listed
private equity investment company managed by Neuberger Berman,
today releases its 2023 Interim Report and 31 August 2023 Monthly
Portfolio Update
Interim Results Highlights (30 June 2023)
- NAV per share of $29.24 (£23.00)
- 4.8% NAV TR in the six months to 30 June 2023
- Strong operating performance driving value and further
supported by positive returns in the quoted portfolio
- Valuations of private companies increased by 3.8% in constant
currencies
- Portfolio company weighted average LTM 30 June 2023 operating
performance of 14.9% revenue and 15.4% EBITDA growth1,
respectively, inclusive of M&A
- Private portfolio LTM/EBITDA valuation multiple of 15.4x at 30
June 2023, an increase from 15.2x at 31 December 2022; weighted
average net debt of 5.4x, a decrease from 5.5x at 31 December
20222
- $291 million of available liquidity at 30 June 2023
Peter Von Lehe, Managing Director and Head of Private
Equity Investment Solutions & Strategy at Neuberger Berman
commented:
“We believe the portfolio is well positioned to navigate the
current macro-economic headwinds. The increase in value of our
private companies was driven by strong operating performance, even
in a challenging economic environment. Our first half performance
was further supported by positive performance from our quoted
holdings.”
Paul Daggett, Managing Director of Neuberger Berman,
continued:
“LTM 30 June 2023 operating performance was strong and with our
overall valuation multiple largely in-line with 31 December 2022,
valuation increases were mostly attributable to earnings growth,
rather than multiple expansion. This was largely driven by strong
organic growth at a number of companies as well as accretive
M&A – with several companies completing meaningful M&A
transactions in the portfolio to support further growth.”
The Company’s 2023 Interim Report is available to view at:
https://www.nbprivateequitypartners.com/.
As of 30 June 2023 |
YTD |
1 Year |
3 years |
5 years |
10 years |
NAV TR (USD)*Annualised |
4.8% |
5.4%5.4% |
75.5%20.6% |
89.3%13.6% |
238.0%13.0% |
MSCI World TR (USD)*Annualised |
15.4% |
19.1%19.1% |
43.2%12.2% |
58.3%9.6% |
161.5%10.1% |
|
|
|
|
|
|
Share price TR (GBP)*Annualised |
(3.9%) |
6.1%6.1% |
84.2%22.6% |
74.4%11.8% |
290.0%14.6% |
FTSE All-Share TR (GBP)*Annualised |
5.3% |
7.9%7.9% |
33.2%10.0% |
16.5%3.1% |
78.0%5.9% |
*Reflects cumulative returns over the time periods shown and are
not annualised.
Portfolio Update to 31 August 2023
Following the 1H private portfolio valuation increases detailed
above, movements in public holdings and negative FX movements in
July and August resulted in a NAV TR increase of 1.8% during 2023
year to date
- 31 August 2023 NAV per share of $27.93 (£22.04), a decrease of
3.0% in the month
- $36 million ($0.77 per share) and $7 million ($0.15 per share)
attributable to declines in quoted share prices and negative
foreign exchange valuation adjustments, respectively, during the
month of August
- $22 million ($0.47 per share) declared in July and paid in
August 2023
As of 31 August 2023 |
YTD |
1 Year |
3 years |
5 years |
10 years |
NAV TR (USD)*Annualised |
1.8% |
4.3%4.3% |
66.6%18.6% |
83.9%13.0% |
221.0%12.4% |
MSCI World TR (USD)*Annualised |
16.5% |
16.2%16.2% |
29.2%8.9% |
53.0%8.9% |
156.0%9.9% |
|
|
|
|
|
|
Share price TR (GBP)*Annualised |
0.9% |
0.5%0.5% |
92.4%24.4% |
67.5%10.9% |
311.4%15.2% |
FTSE All-Share TR (GBP)*Annualised |
2.7% |
5.2%5.2% |
34.9%10.5% |
18.4%3.4% |
70.6%5.5% |
*Reflects cumulative returns over the time periods shown and are
not annualised.
Realisations from the portfolio continue in
2023
- 2023 year to date announced realisations of $127 milllion3
– Seven full or partial sales pending in 2023: the
full sales of Accedian, FV Hospital, Boa Vista, Concord Bio and
Petsmart, as well as further liquidity from the partial sales of
public stock in Vertiv and Holley
$20m of investment year to date through 31 August
2023
- Including $13m follow-ons investments in Solenis and
Renaissance Learning to support transformative M&A
Dividend of $22 million paid in August
- Taking total dividends for 2023 to $44m, or $0.94 per share,
a 3.4% yield on NAV and 4.8% yield on the share price
Significant available liquidity at 31 August
2023
- $210 million undrawn credit line and $67 million of cash /
liquid investments
- In addition, $67 million of distributions expected to be
received over the coming months from announced realisations
Repayment of ZDPs at the maturity date in October 2024
and cash management
- The Directors’ intend for NBPE to repay the final entitlement
of £65 million ($83 million) of NBPE’s 2024 ZDPs when they mature
in October 2024
- To facilitate efficient cash management, NBPE drew down the
minimum utilisation amount on its credit facility ($90 million) and
invested a portion of this amount in US Treasury Bills, partially
offsetting NBPE’s minimum utilisation fee
Portfolio Valuation
The fair value of NBPE’s portfolio as of 31 August
2023 was based on the following information:
-
14% of the portfolio was valued as of 31 August 2023
-
- 11% in public securities
- 3% in private direct investments
-
86% of the portfolio was valued as of 30 June 2023
-
- 85% in private direct investments
- 1% in private fund investments
Capital Markets Day
NBPE will hold a virtual Capital Markets
Day.
Date: Thursday 5 October 2023
Start: 14:00 BST
Finish: 16:00 BST
The Company’s Chairman and senior portfolio management team from
NB Private Markets will provide a detailed analysis of the
portfolio and share their latest views on the private equity
market. Neuberger Berman’s ESG team will also provide an update on
the portfolio. In addition, case studies of underlying portfolio
companies will be presented by two of the lead private equity firms
which NBPE has invested alongside. This will be followed by
Q&A.
Participants may register for the event at the following event
page link: Registration
For further information, please contact:
NBPE Investor
Relations +1
214 647 9593
Kaso Legg
Communications +44 (0)20 3995 6673
Charles
Gorman
nbpe@kl-communications.comLuke DampierCharlotte Francis
Supplementary Information (as at 31
August 2023)
Company Name |
Vintage |
Lead Sponsor |
Sector |
Fair Value ($m) |
% of FV |
Action |
2020 |
3i |
Consumer |
76.5 |
5.4% |
Osaic |
2019 |
Reverence
Capital |
Financial
Services |
56.5 |
4.0% |
USI |
2017 |
KKR |
Financial
Services |
54.0 |
3.8% |
Constellation
Automotive |
2019 |
TDR
Capital |
Business
Services |
49.1 |
3.5% |
Solenis |
2021 |
Platinum
Equity |
Industrials |
47.2 |
3.3% |
AutoStore
(OB.AUTO) |
2019 |
THL |
Industrials |
42.3 |
3.0% |
Fortna |
2017 |
THL |
Industrials |
37.9 |
2.7% |
Cotiviti |
2018 |
Veritas
Capital |
Healthcare |
36.6 |
2.6% |
Business
Services Company* |
2017 |
Not
Disclosed |
Business
Services |
33.4 |
2.4% |
BeyondTrust |
2018 |
Francisco
Partners |
Technology /
IT |
32.7 |
2.3% |
Monroe
Engineering |
2021 |
AEA
Investors |
Industrials |
31.9 |
2.3% |
True
Potential |
2022 |
Cinven |
Financial
Services |
30.5 |
2.2% |
Kroll |
2020 |
Further Global
/ Stone Point |
Financial
Services |
30.1 |
2.1% |
Branded Cities
Network |
2017 |
Shamrock
Capital |
Communications
/ Media |
29.9 |
2.1% |
GFL (NYSE:
GFL) |
2018 |
BC
Partners |
Business
Services |
29.4 |
2.1% |
Marquee
Brands |
2014 |
Neuberger
Berman |
Consumer |
28.9 |
2.0% |
Stubhub |
2020 |
Neuberger
Berman |
Consumer |
26.4 |
1.9% |
Staples |
2017 |
Sycamore
Partners |
Business
Services |
25.6 |
1.8% |
Engineering |
2020 |
NB Renaissance
/ Bain Capital |
Technology /
IT |
25.1 |
1.8% |
Agiliti (NYSE:
AGTI) |
2019 |
THL |
Healthcare |
24.1 |
1.7% |
Bylight |
2017 |
Sagewind
Partners |
Technology /
IT |
23.9 |
1.7% |
Addison
Group |
2021 |
Trilantic
Capital Partners |
Business
Services |
23.9 |
1.7% |
Auctane |
2021 |
Thoma
Bravo |
Technology /
IT |
22.9 |
1.6% |
Excelitas |
2017 |
AEA
Investors |
Industrials |
21.9 |
1.6% |
Accedian |
2017 |
Bridge Growth
Partners |
Technology /
IT |
21.3 |
1.5% |
Branded Toy
Company* |
2017 |
Not
Disclosed |
Consumer |
21.2 |
1.5% |
FV
Hospital |
2017 |
Quadria
Capital |
Healthcare |
20.5 |
1.5% |
Renaissance
Learning |
2018 |
Francisco
Partners |
Technology /
IT |
20.0 |
1.4% |
Solace
Systems |
2016 |
Bridge Growth
Partners |
Technology /
IT |
19.8 |
1.4% |
Viant |
2018 |
JLL
Partners |
Healthcare |
19.1 |
1.4% |
Total Top 30 Investments |
|
|
|
943.6 |
66.9% |
*Undisclosed company due to confidentiality
provisions.
Geography |
% of Portfolio |
North
America |
74% |
Europe |
22% |
Asia / Rest of
World |
4% |
Total Portfolio |
100% |
|
|
Industry |
% of Portfolio |
Tech, Media
& Telecom |
21% |
Consumer /
E-commerce |
20% |
Industrials /
Industrial Technology |
17% |
Business
Services |
12% |
Financial
Services |
14% |
Healthcare |
9% |
Other |
5% |
Energy |
1% |
Total Portfolio |
100% |
|
|
Vintage Year |
% of Portfolio |
2015 &
Earlier |
6% |
2016 |
7% |
2017 |
25% |
2018 |
19% |
2019 |
15% |
2020 |
12% |
2021 |
12% |
2022 |
3% |
2023 |
1% |
Total Portfolio |
100% |
About NB Private Equity Partners
LimitedNBPE invests in direct private equity investments
alongside market leading private equity firms globally. NB
Alternatives Advisers LLC (the “Investment Manager”), an indirect
wholly owned subsidiary of Neuberger Berman Group LLC, is
responsible for sourcing, execution and management of NBPE. The
vast majority of direct investments are made with no management fee
/ no carried interest payable to third-party GPs, offering greater
fee efficiency than other listed private equity companies. NBPE
seeks capital appreciation through growth in net asset value over
time while paying a bi-annual dividend.
LEI number: 213800UJH93NH8IOFQ77
About Neuberger BermanNeuberger
Berman, founded in 1939, is a private, independent, employee-owned
investment manager. The firm manages a range of
strategies—including equity, fixed income, quantitative and
multi-asset class, private equity, real estate and hedge funds—on
behalf of institutions, advisors and individual investors globally.
Neuberger Berman’s investment philosophy is founded on active
management, engaged ownership and fundamental research, including
industry-leading research into material environmental, social and
governance factors. Neuberger Berman is a PRI Leader, a designation
awarded to fewer than 1% of investment firms. With offices in 26
countries, the firm’s diverse team has over 2,750 professionals.
For nine consecutive years, Neuberger Berman has been named first
or second in Pensions & Investments Best Places to Work in
Money Management survey (among those with 1,000 employees or more).
The firm manages $443 billion in client assets as of June 30, 2023.
For more information, please visit our website at www.nb.com.
This press release appears as a matter of record only and does
not constitute an offer to sell or a solicitation of an offer to
purchase any security. NBPE is established as a closed-end
investment company domiciled in Guernsey. NBPE has received the
necessary consent of the Guernsey Financial Services Commission.
The value of investments may fluctuate. Results achieved in the
past are no guarantee of future results. This document is not
intended to constitute legal, tax or accounting advice or
investment recommendations. Prospective investors are advised to
seek expert legal, financial, tax and other professional advice
before making any investment decision. Statements contained in this
document that are not historical facts are based on current
expectations, estimates, projections, opinions and beliefs of
NBPE's investment manager. Such statements involve known and
unknown risks, uncertainties and other factors, and undue reliance
should not be placed thereon. Additionally, this document contains
"forward-looking statements." Actual events or results or the
actual performance of NBPE may differ materially from those
reflected or contemplated in such targets or forward-looking
statements. |
1 Revenue & EBITDA Growth: Past performance is no guarantee
of future results. Fair value as of 30 June 2023 and the data is
subject to the following adjustments: 1) Excludes public companies.
2) Analysis based on 65 private companies and excludes Marquee
Brands and one PIK preferred investment. 3) The private companies
included in the data represent approximately 81% of the total
direct equity portfolio. 4) Five companies were excluded from the
revenue and EBITDA growth metrics on the basis of the following: a)
one company used an industry-specific metric as a measurement of
cash flow b) one company (less than 1.5% of direct equity fair
value) had anomalous percentage changes which the manager believed
to be an outlier c) three investments held less than one year. One
company was included in the 30 June 2023 growth metrics, but was
excluded at 31 December 2022 due to an extraordinary growth rate.
If this company was excluded at 30 June 2023 from the growth
metrics, LTM Revenue and LTM EBITDA would have been 14.3% and
14.4%, respectively. Portfolio company operating metrics are based
on the most recently available (unaudited) financial information
for each company and based on as reported by the lead private
equity sponsor to the Manager as of 21 September 2023. Where
necessary, estimates were used, which include pro forma adjusted
EBITDA and other EBITDA adjustments, pro forma revenue adjustments,
run-rate adjustments for acquisitions, and annualised quarterly
operating metrics. LTM periods as of 30 June 2023 and 31 March 2023
and 30 June 2022 and 31 March 2022. LTM revenue and LTM EBITDA
growth rates are weighted by fair value.
2 Valuation & Leverage: Past performance is no guarantee of
future results. Fair value as of 30 June 2023 and subject to the
following adjustments. 1) Excludes public companies, one PIK
preferred investment and Marquee Brands. 2) Based on 65 private
companies which are valued based on EV/EBITDA metrics, but excludes
two companies due to the following: a) one company used an
industry-specific metric as a measurement of cash flow b) one
company was valued based on a recent transaction pricing. 3) The
private companies included in the data represents 71% of direct
equity investment fair value. 4) Companies not valued on multiples
of trailing EBITDA are excluded from valuation statistics. 5)
Leverage statistics exclude companies with net cash position and
leverage data represents 67% of direct equity investment fair
value. Portfolio company operating metrics are based on the most
recently available (unaudited) financial information for each
company and are as reported by the lead private equity sponsor to
the Manager as of 21 September 2023, based on reporting periods as
of 30 June 2023 and 31 March 2023. EV and leverage data is weighted
by fair value.
3 $60 million received during 2023, of which $11 million was
attributable to an announced sale in 2022 but received in 2023.
Pending realisations are subject to customary closing conditions.
No assurances can be given the transactions ultimately close.
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