ICG Enterprise Trust Plc: Unaudited Interim Results for the six months ended 31 July 2024
ICG Enterprise Trust plc
Unaudited Interim Results for the six months ended 31 July 2024
8 October 2024
Highlights
· NAV per Share of 1,946p at 31 July 2024, NAV per Share Total Return* of 2.8% in the period (5 year annualised: 12.5%)
· Portfolio Return* on a Local Currency Basis of 3.8% (Sterling return 2.6%) for the six months in the period
· Portfolio companies reporting ~14% LTM earnings growth^1
· Third consecutive six-month period of higher new investment levels
· Nine Full Exits in the period generating proceeds of £48.7m and representing a weighted-average Uplift to Carrying Value of 25.8%
· Q2 dividend of 8.5p per share, taking total dividends for H1 FY25 to 17p (H1 FY24: 16p). The Board's intention remains to pay total dividends of at least 35p per share for FY25, an increase of 6% on FY24
· Buybacks continue to be executed: £21m returned in H1 FY25 at a weighted-average discount to NAV of 37.8% across both long-term (£11m) and opportunistic (£10m) programmes, in aggregate increasing NAV per share by 19p (~1%)
· The Board welcomes the recent announcement by the FCA regarding costs and the Manager is reviewing ICG Enterprise Trust's disclosures as a result
1 Based on Enlarged Perimeter covering 63% of the Portfolio. See page 9.
*This is an Alternative Performance Measure. Please refer to the Glossary for the definition.
Oliver Gardey Head of Private Equity Fund Investments, ICG For the six months to 31 July 2024 our Portfolio Return on a Local Currency Basis was 3.8% and we report a NAV per Share of 1,946p at period end.
During the period we invested £104m into new transactions. These included supporting Datasite, Visma and Audiotonix – highlighting our ability to invest in companies that benefit from long-term structural growth trends in areas such as digital transformation and tech-enabled business services.
We are experiencing an increased level of transaction activity. This is the third six-month period of sequentially higher new investments. And as our portfolio companies are realised we are generating meaningful value: we had nine Full Exits in the period that were realised at a weighted-average uplift to carrying value of 25.8%.
Over the last five years – a period that encompasses COVID-19, inflation, interest rate hikes and geopolitical uncertainty – our Portfolio has delivered attractive growth; our NAV per Share Total Return has been 80%; and we have enhanced our shareholder distribution policy.
I am confident in the transatlantic Portfolio we have constructed. I believe our strategy to invest in profitable, cash generative middle market companies positions us well to deliver attractive returns for our shareholders.
PERFORMANCE OVERVIEW
*Annualised*
*Performance to 31 July 2024* 3 months 6 months 1 year 3 years 5 years 10 years
Portfolio Return on a Local Currency Basis 3.2% 3.8% 5.9% 11.5% 15.9% 13.6%
NAV per Share Total Return 1.6% 2.8% 4.0% 10.3% 12.5% 13.2%
Share Price Total Return 11.4% 10.3% 17.3% 10.1% 11.7% 11.5%
FTSE All-Share Index Total Return 4.3% 11.8% 13.5% 8.3% 5.8% 6.3%
*Half-year ended:* *Jul 2020* *Jul 2021* *Jul 2022* *Jul 2023* *Jul 2024*
*Fund performance* Portfolio return (local currency) (3.6)% 14.9% 7.4% 4.6% 3.8%
Portfolio return (sterling) 0.1% 12.8% 12.4% 1.6% 2.6%
NAV £775m £1,044m £1,269m £1,290m £1,274m
NAV per Share Total Return (%) (1.0)% 11.1% 10.9% 0.8% 2.8%
*Investment activity* New Investments £52m £133m £144m £64m £104m
As % opening Portfolio 6% 14% 12% 5% 8%
Total Proceeds £94m £185m £107m £94m £86m
As % opening Portfolio 12% 19% 9% 7% 6%
*Shareholder experience*
Closing share price 790p 1,084p 1,166p 1,174p 1,340p
Total dividends per share for HY 10p 12p 14p 16p 17p
Share Price Total Return (16.9)% 13.7% (1.6)% 2.9% 10.3%
Total shareholder distributions £10m £12m £15m £17m £33m
- o/w distributions dividends (%) 92% 78% 100% 63% 34%
- o/w distributions buybacks (%) 8% 22% —% 37% 66%
Total shareholder distributions as %
- Total Proceeds 10% 7% 14% 18% 38%
- Opening NAV 1.2% 1.3% 1.3% 1.3% 2.5%
*Portfolio activity overview for H1 FY25* *Primary* *Direct* *Secondary* *Total* *ICG-managed*
Local Currency return 3.6% 5.0% 2.5% 3.8% 2.1%
Sterling return 2.4% 3.7% 1.4% 2.6% 1.0%
New Investments £58m £44m £3m £104m £17m
Total Proceeds £51m £9m £26m £86m £50m
New Fund Commitments £52m - £20m £72m £20m
*Closing Portfolio value* *£739m* *£444m* *£219m* *£1,402m* *£410m*
% Total Portfolio 52.7% 31.7% 15.6% 100.0% 29.2%
COMPANY TIMETABLE
A presentation for investors and analysts will be held at 10:00 GMT today. A link for the presentation can be found on the Results & Reports page of the Company website. A recording of the presentation will be made available on the Company website after the event.
*FY25 Second Interim Dividend*
Ex-dividend date 14 November 2024
Record date 15 November 2024
Dividend payment date 29 November 2024
ENQUIRIES
Institutional investors and analysts: Martin Li, Shareholder Relations +44 (0) 20 3545 1816
Nathan Brown, Deutsche Numis +44 (0) 20 7260 1426
David Harris, Cadarn Capital +44 (0) 20 7019 9042
Media: Cat Armstrong, Corporate Communications +44 (0) 20 3545 1850
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, cash-generative private companies, primarily in Europe and the US, while offering the added benefit to shareholders of daily liquidity.
We invest in companies directly as well as through funds managed by Intermediate Capital Group ('ICG') and other leading private equity managers who focus on creating long-term value and building sustainable growth through active management and strategic change.
NOTES
Included in this document are Alternative Performance Measures (“APMs”). APMs 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 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
The information contained herein and on the pages that follow does not constitute an offer to sell, or the solicitation of an offer to acquire or subscribe for, any securities in any jurisdiction where such an offer or solicitation is unlawful or would impose any unfulfilled registration, qualification, publication or approval requirements on ICG Enterprise Trust PLC (the "Company") or its affiliates or agents. Equity securities in the Company have not been and will not be registered under the applicable securities laws of the United States, Australia, Canada, Japan or South Africa (each an “Excluded Jurisdiction”). The equity securities in the Company referred to herein and on the pages that follow may not be offered or sold within an Excluded Jurisdiction, or to any U.S. person ("U.S. Person") as defined in Regulation S under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), or to any national, resident or citizen of an Excluded Jurisdiction.
The information on the pages that follow may contain forward looking statements. Any statement other than a statement of historical fact is a forward looking statement. Actual results may differ materially from those expressed or implied by any forward looking statement. The Company does not undertake any obligation to update or revise any forward looking statements. You should not place undue reliance on any forward looking statement, which speaks only as of the date of its issuance.
CHAIR’S FOREWORD
ICG Enterprise Trust has delivered a 2.8% NAV per Share Total Return and 10.3% Share Price Total Return in the first half of the year. This solid NAV per Share growth and sustained returns for our shareholders, in a half-year with continued economic and political headwinds, is supported by robust underlying earnings growth (LTM EBITDA growth^1: 14%), an active capital allocation policy and prudent balance sheet management.
Over the five years to 31 July 2024, the investment strategy has generated an annualised NAV per Share Total Return of 12.5% and Share Price Total Return of 11.7%. The volatility of our share price has reduced over this time period and liquidity has increased. I believe these factors enable ICG Enterprise Trust to have an increasingly meaningful role in an investor’s long-term portfolio.
Capital allocation remains a priority for the Board and in this period we returned £33m (2.5% of opening NAV) to shareholders through:
· Dividends: we remain committed to a progressive dividend policy, announcing today a Q2 dividend of 8.5p per share and reaffirming the Board’s intention to pay total dividends of at least 35p per share for FY25;
· Long-term share buyback programme: returned £11m across 46 separate trading days at a weighted-average discount to NAV of 38.3%; and
· FY25 opportunistic share buyback programme: returned £10m across four separate trading days at a weighted-average discount to NAV of 37.2%.
The combined buyback programmes in aggregate increased NAV per Share by 19p (~1%) during the period.
We are pleased to see a continued increase in shareholder engagement, and the evolution in recent quarters of our sales and marketing programme is yielding benefits. I enjoyed meeting a number of shareholders at our Shareholder Seminar in June, and look forward to more engagement before year-end.
The Board welcomes the new FCA announcement on reporting of costs, and as a result the Manager is reviewing ICG Enterprise Trust's disclosures.
As we look to the second half of the financial year and beyond, geopolitical headwinds persist. However, the Board maintains its positive outlook that private equity remains a strong engine of growth to outperform public markets.
*Jane Tufnell*
*Chair*
7 October 2024
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 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. The same is true for the IFRS and APM basis of the Cash flow statement.
The following table sets out IFRS metrics and the APM equivalents:
*IFRS (£m)* *31 July 2024* *31 July 2023* *APM (£m)* *31 July 2024* *31 July 2023*
Investments 1,362.0 1,342.7 Portfolio 1,401.8 1,398.8
NAV 1,273.5 1,290.3
Cash flows from the sale of portfolio investments 9.3 15.7 Total Proceeds 86.4 94.1
Cash flows related to the purchase of portfolio investments 23.3 15.5 Total New Investment 104.4 64.1
The Glossary includes definitions for all APM and, where appropriate, a reconciliation between APM and IFRS.
Our investment strategy
We focus on investing in buyouts of profitable, cash-generative businesses in developed markets that exhibit defensive growth characteristics which we believe support strong and resilient returns across economic cycles.
We take an active approach to portfolio construction, with a flexible mandate that enables us to deploy capital in Primary, Secondary and Direct investments. Geographically we focus on the developed markets of North America and Europe which have deep and mature private equity markets supported by a robust corporate governance ecosystem.
*Medium-term target* *Five-year average* *31 July 2024*
*1. Target Portfolio composition *^*1*
Investment category
Primary ~50% 59% 52%
Direct ~25% 28% 32%
Secondary ~25% 13% 16%
Geography^2
North America ~50% 42% 44%
Europe (inc. UK) ~50% 51% 49%
Other — 7% 7%
*2. Balance sheet*
Net cash/(Net debt)^3 ~0% —% (6)%
1 As percentage of Portfolio; 2 As percentage of Portfolio; 3 Net cash/(net debt) as a percentage of NAV
Note: five year average is the linear average of FY exposures for FY21 - FY24 and H1 FY25
ICG Enterprise Trust benefits from access to ICG-managed funds and Direct investments, which represented 29.2% of the Portfolio value at period end and generated a 2.1% return on a local currency basis.
Performance overview
At 31 July 2024, our Portfolio was valued at £1,402m, and the Portfolio Return on a Local Currency Basis for the first half of the financial year was 3.8% (H1 FY24: 4.6%).
Due to the geographic diversification of our Portfolio, the reported value is impacted by changes in foreign exchange rates. During the period, FX movements affected the Portfolio negatively by £(16.1)m, driven by Sterling appreciation versus both the Euro and US Dollar. In Sterling terms, Portfolio growth during the period was 2.6%.
The net result for shareholders was that ICG Enterprise Trust generated a NAV per Share Total Return of 2.8% during H1 FY25, ending the period with a NAV per Share of 1,946p.
*Movement in the Portfolio*
*£m* *Six months to*
*31 July 2024* *Six months to*
*31 July 2023*
*Opening Portfolio*^*1* *1,349* *1,406*
Total New Investments 104 64
Total Proceeds (86) (94)
Portfolio net cashflow 18 (30)
Valuation movement^2 51 65
Currency movement (16) (43)
*Closing Portfolio* *1,402* *1,399*
1 Refer to the Glossary
2 90.3% of the Portfolio is valued using 30 June 2024 (or later) valuations (2023: 92.4%)
*NAV per Share Total Return* *Six months to*
*31 July 2024* *Six months to*
*31 July 2023*
*% Portfolio growth (local currency)* *3.8%* *4.6%*
% currency movement (1.2)% (3.0%)
*% Portfolio growth (Sterling)* *2.6%* *1.6%*
Impact of (net cash)/net debt 0.1% 0.1%
Management fee and other expenses (0.9)% (1.0)%
Co-investment Incentive Scheme Accrual (0.1)% (0.2)%
Impact of share buybacks and dividend reinvestment 1.0% 0.3%
*NAV per Share Total Return* *2.8%* *0.8%*
For Q2 the Portfolio Return on a Local Currency Basis was 3.2% and the NAV per Share Total Return was 1.6%.
Executing our investment strategy
*Commitments *
in the period *Total New Investments*
in the period *Growth *
in the period *Total Proceeds*
in the period
Making commitments to funds, which expect to be drawn over 3 to 5 years Cash deployments into portfolio companies, either through funds or directly Driving growth and value creation of our portfolio companies Cash realisations of investments in Portfolio companies, plus Fund Disposals
*£72m*
(H1 FY24: £110m) *£104m*
(H1 FY24: £64m) *£**51**m*
(H1 FY24: £65m) *£**86**m*
(H1 FY24: £94m)
*Commitments*
Our evergreen structure and flexible investment mandate enables us to commit through the cycle, maintaining vintage diversification for our Portfolio and sowing the seeds for future growth.
During the period we made five new fund Commitments totalling £72.0m, including £19.8m to funds managed by ICG plc, as detailed below:
*Fund* *Manager* *Commitment during the period* *Local currency* *£m*
ICG Strategic Equity V ICG $25.0m £19.8m
Investindustrial VIII Investindustrial €15.0m £12.9m
Leeds VIII Leeds Equity $20.0m £15.7m
Oak Hill VI Oak Hill $15.0m £11.9m
Thoma Bravo XVI Thoma Bravo $15.0m £11.7m
At 31 July 2024, ICG Enterprise Trust had outstanding Undrawn Commitments of £575m:
*Movement in outstanding Commitments* *Six months to 31 July 2024 (£m)*
Undrawn Commitments as at 1 February 2024 552
New Fund Commitments 72
New Commitments relating to Co-investments 54
Drawdowns (104)
Currency and other movements, including repayment of commitments which can be reinvested 2
*Undrawn commitments as at 31 July 2024* *575*
Total Undrawn Commitments at 31 July 2024 represented £452m of Undrawn Commitments to funds within their Investment Periods, with £123m to funds outside their Investment Periods.
*31 July 2024*
*£m* *31 July 2023 *
*£m*
Undrawn Commitments – funds in Investment Period 452 429
Undrawn Commitments – funds outside Investment Period 123 119
*Total Undrawn Commitments* *575* *549*
Total available liquidity (including facility) (126) (159)
*Overcommitment net of total available liquidity* *449* *390*
*Overcommitment % of net asset value* *35.3%* *30.2%*
Commitments are made in the funds' underlying currencies. The currency split of the undrawn commitments at 31 July 2024 was as follows:
*31 July 2024* *31 July 2023*
*Undrawn Commitments* *£m* *%* *£m* *%*
US Dollar 325 56.6% 272 49.4%
Euro 221 38.4% 261 47.6%
Sterling 29 5.0% 16 3.0%
*Total* *575* *100.0%* *549* *100.0%*
*Investments*
Total new investments of £104m during the period, of which 16% (£17.0m) were alongside ICG. New investment by category detailed in the table below:
*Investment Category*
*Cost (£m)* *% of New Investments*
Primary £57.8m 55.4%
Direct £43.8m 42.0%
Secondary £2.7m 2.6%
*Total* *£104.4m* *100.0%*
The five largest underlying new investments in the period were as follows:
*Investment* *Description* *Manager* *Country* *Cost £m*^*1*
Datasite Provider of SaaS software focused on virtual data rooms ICG United States 24.6
Visma Provider of business management software and outsourcing services HgCapital Norway 14.9
Audiotonix Manufacturer of audio mixing consoles PAI Partners United Kingdom 12.8
Eque2 Developer of enterprise resource planning software intended for construction and contracting industries Bowmark United Kingdom 3.4
Multiversity Provider of online higher education CVC Italy 2.9
*Total of top 5 largest underlying new investments* *58.6*
1 Represents ICG Enterprise Trust's indirect investment (share of fund cost) plus any direct investments in the period.
*Growth*
The portfolio grew by £51 million (+3.8%) on a Local Currency Basis in the six months to 31 July 2024.
Growth across the Portfolio was split as follows:
· By investment type: growth was spread across Primary (3.6%), Secondary (2.5%) and Direct (5.0%)
· By geography: North America and Europe experienced similar growth
The growth in the Portfolio is underpinned by the performance of our Portfolio companies, which delivered robust financial performance during the period:
*Top 30* *Enlarged Perimeter*
Portfolio coverage 40% 63%
Last Twelve Months ('LTM') revenue growth 6.8% 9.4%
LTM EBITDA growth 10.4% 13.9%
Net Debt / EBITDA 4.3x 4.4x
Enterprise Value / EBITDA 15.3x 14.9x
Note: values are weighted averages for the respective portfolio segment; see Glossary for definition and calculation methodology
Quoted company exposure
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 manager with whom we have invested.
At 31 July 2024, ICG Enterprise Trust’s exposure to quoted companies was valued at £60m, equivalent to 4.3% of the Portfolio value (31 January 2024: 4.8%). Across the Portfolio, quoted positions resulted in a £4m increase in Portfolio NAV during the period. The share price of our largest listed exposure, Chewy, increased by 36% in local currency (USD) during the period. This positively impacted the Portfolio Return on a Local Currency Basis by approximately 0.5%.
At 31 July 2024 Chewy was the only quoted investment that individually accounted for 0.5% or more of the Portfolio value:
*Company* *Ticker* *31 July 2024*
*% of Portfolio value*
Chewy CHWY-US 1.6%
Other companies 2.7%
Total *4.3%*
*Realisations*
During the first half of FY25, the ICG Enterprise Trust Portfolio generated Total Realisation Proceeds of £86m.
Realisation activity during the period included nine Full Exits generating proceeds of £48.7m. These were completed at a weighted average Uplift to Carrying Value of 25.8% and represent a weighted average Multiple to Cost of 3.1x for those investments.
The five largest underlying realisations in the period were as follows:
*Realisation* *Description* *Manager* *Country* *Proceeds £m*
Vettafi Provider of financial indices and data ICG United States 10.3
Visma Provider of business management software ICG Norway 8.2
Datasite Provider of SaaS software focused on virtual data rooms ICG United States 7.8
Compass Community Provider of children's fostering services Graphite United Kingdom 7.4
Iris Provider of software for the accountancy and payroll sectors ICG United Kingdom 7.0
*Total of 5 largest underlying realisations* *40.7*
Balance sheet and liquidity
Net assets at 31 July 2024 were £1,274m, equal to 1,946p per share.
At 31 July 2024, the drawn debt was £93.3m (31 January 2024: £20.0m), resulting in a net debt position of £76.4m (31 January 2024: £8.8m). At 31 July 2024, the Portfolio represented 110.1% of net assets (31 January 2024: 105.1%).
*£m* *% of net assets*
Portfolio 1,402 110.1%
Cash 17 1.3%
Drawn debt (93) (7.3%)
Co-investment Incentive Scheme Accrual (47) (3.7%)
Other net current liabilities (5) (0.4%)
*Net assets* *1,274* *100.0%*
Our objective is to be fully invested through the cycle, while ensuring that we have sufficient financial resources to be able to take advantage of attractive investment opportunities as they arise.
At 31 July 2024, ICG Enterprise Trust had a cash balance of £16.9m (31 January 2024: £11.2m) and total available liquidity of £125.7m (31 January 2024: £195.9m).
*£m*
*Cash at 31 January 2024* *11*
Total Proceeds 86
New investments (104)
Debt drawn down 74
Shareholder returns (33)
Management fees (8)
FX and other expenses (10)
*Cash at 31 July 2024* *17*
Available undrawn debt facilities 109
*Total available liquidity* *126*
Dividend and share buyback
ICG Enterprise Trust has a progressive dividend policy alongside two share buyback programmes to return capital to shareholders.
Progressive dividend policy (since 2017)
The Board has declared a dividend of 8.5p per share in respect of the second quarter, taking total dividends for the period to 17p (H1 FY24: 16p). It remains the Board's intention to declare total dividends of at least 35p per share for the financial year, implying an increase of 6% on the previous financial year (FY24: 33p).
Long-term share buyback programme (since 2022)
The following purchases have been made under the Company's long-term share buyback programme:
*Buyback activity summary* *H1 FY25* *Since 19 October 2022*^*1*
Number of shares purchased 920,000 2,432,188
Aggregate consideration £11.0m £28.5m
Weighted average discount to last reported NAV 38.3% 38.7%
^1 Being the date the long-term share buyback programme was announced, up to and including 1 October 2024
Note: aggregate consideration excludes commission, PTM and SDRT
The Board believes the buyback programme demonstrates the Manager’s discipline around capital allocation; underlines the Board’s confidence in the long-term prospects of the Company, its cashflows and NAV; will enhance the NAV per share; and, over time, may positively influence the volatility of the Company’s discount and its trading liquidity.
Opportunistic share buyback programme (since May 2024)
During the period, the Board announced an opportunistic share buyback programme for FY25 of up to £25m. This will enable us to take advantage of current trading levels, when the ability to purchase shares in meaningful size at a significant discount presents itself. The following purchases have been made under this programme:
*Buyback activity summary* *H1 FY25* *Since 8 May 2024*^*1*
Number of shares purchased 835,000 993,000
Aggregate consideration £10.0m £11.9m
Weighted average discount to last reported NAV 37.2% 37.2%
^1 Being the date the opportunistic share buyback programme was announced, up to and including 1 October 2024
Note: aggregate consideration excludes commission, PTM and SDRT
Foreign exchange rates
The details of relevant FX rates applied in this report are provided in the table below:
*Average rate 6 months to* *Period end rate* *31 July 2024* *31 July 2023* *31 July 2024* *31 July 2023*
GBP:EUR 1.1738 1.1465 1.1875 1.1671
GBP:USD 1.2678 1.2445 1.2856 1.2836
EUR:USD 1.0801 1.0854 1.0826 1.0997
Activity since the period end
Notable activity between 1 August 2024 and 31 August 2024 included:
· No new fund commitments
· New investments of £3.5m
· Realisation Proceeds of £9.2m
*ICG Private Equity Fund Investments Team*
7 October 2024
SUPPLEMENTARY INFORMATION
This section presents supplementary information regarding the Portfolio (see Manager’s Review and the Glossary for further details and definitions).
Portfolio composition
*Portfolio by calendar year of investment* *% of value of underlying investments *
*31 July 2024* *% of value of underlying investments *
* 31 July 2023*
2024 6.7% —%
2023 7.4% 2.3%
2022 17.7% 17.0%
2021 26.2% 27.4%
2020 9.5% 10.7%
2019 11.6% 12.7%
2018 8.0% 10.7%
2017 2.6% 6.2%
2016 2.9% 4.0%
2015 and older 7.4% 9.0%
*Total* *100.0%* *100.0%*
*Portfolio by sector* *% of value of underlying investments *
*31 July 2024* *% of value of underlying investments *
* 31 July 2023*
TMT 28.7% 24.1%
Consumer goods and services 18.3% 20.9%
Healthcare 10.7% 13.2%
Business services 12.9% 12.9%
Industrials 8.2% 8.1%
Education 5.3% 5.4%
Financials 7.6% 6.0%
Leisure 4.4% 4.8%
Other 3.9% 4.6%
*Total* *100.0%* *100.0%*
*Portfolio by fund currency*^1 *31 July 2024 *
*£m* *31 July 2024*
* %* *31 July 2023 *
*£m* *31 July 2023 *
*%*
US Dollar 701.0 50.0% 671.3 48.0%
Euro 566.2 40.4% 612.0 43.8%
Sterling 134.6 9.6% 115.2 8.2%
Other 0.0 —% 0.3 —%
*Total* *1,401.8* *100.0%* *1,398.8* *100.0%*
^1 Currency exposure by reference to the reporting currency of each fund .
Portfolio Dashboard
The tables below provide disclosure on the composition and dispersion of financial and operational performance for the Top 30 and the Enlarged Perimeter. At 31 July 2024, the Top 30 Companies represented 40% of the Portfolio by value and the Enlarged Perimeter represented 63% of total Portfolio value. This information is prepared on a value-weighted basis, based on contribution to Portfolio value at 31 July 2024.
*% of value at 31 July 2024*
*Sector exposure* *Top 30* *Enlarged Perimeter*
TMT 33.0% 28.6%
Industrials 16.0% 9.0%
Consumer goods and services 15.7% 18.1%
Business services 10.8% 14.8%
Healthcare 8.2% 10.3%
Leisure 6.9% 5.4%
Education 6.0% 6.4%
Financials 3.4% 4.1%
Other — % 3.3%
*Total* *100.0%* *100.0%*
*% of value at 31 July 2024*
*Geographic exposure*^1 *Top 30 * * Enlarged Perimeter*
North America 40.3% 43.5%
Europe 53.6% 52.1%
Other 6.1% 4.4%
*Total* *100.0%* *100.0%*
1 Geographic exposure is calculated by reference to the location of the headquarters of the underlying Portfolio companies
*% of value at 31 July 2024*
*LTM revenue growth* *Top 30 * *Enlarged Perimeter *
<0% 20.2% 21.0%
0-10% 48.6% 38.9%
10-20% 25.9% 24.5%
20-30% 5.3% 8.8%
>30% —% 4.1%
n.a. —% 2.6%
*Weighted average* *6.8%* *9.4%*
Note: for consistency, any excluded investments are excluded for all dispersion analysis.
*% of value at 31 July 2024*
*LTM EBITDA growth* *Top 30 * *Enlarged Perimeter *
<0% 21.4% 22.7%
0-10% 23.2% 20.1%
10-20% 31.4% 26.2%
20-30% 11.1% 11.1%
>30% 13.0% 17.0%
n.a —% 2.9%
*Weighted average* *10.4%* *13.9%*
Note: for consistency, any excluded investments are excluded for all dispersion analysis. *% of value at 31 July 2024*
*EV/EBITDA multiple* *Top 30 * *Enlarged Perimeter *
0-10x 8.3% 10.3%
10-12x 25.9% 21.6%
12-13x 2.5% 4.5%
13-15x 22.5% 21.2%
15-17x 18.9% 18.0%
17-20x 5.4% 7.8%
>20x 16.5% 13.3%
n.a. —% 3.4%
*Weighted average* *15.3x* *14.9x*
Note: for consistency, any excluded investments are excluded for all dispersion analysis. *% of value at 31 July 2024*
*Net Debt / EBITDA* *Top 30 * *Enlarged Perimeter *
<2x 23.6% 18.5%
2-4x 20.0% 21.0%
4-5x 8.1% 12.5%
5-6x 13.8% 14.9%
6-7x 18.5% 15.2%
>7x 16.1% 14.1%
n.a. —% 3.8%
*Weighted average* *4.3x* *4.4x*
Note: for consistency, any excluded investments are excluded for all dispersion analysis.
Top 30 companies
The table below presents the 30 companies in which ICG Enterprise Trust had the largest investments by value at 31 July 2024. The valuations are gross of underlying managers fees and carried interest.
*Company* *Manager* *Year of investment* *Country* *Value as a % of Portfolio*
*1* *Minimax* Supplier of fire protection systems and services ICG 2018 Germany 3.4%
*2* *Froneri* Manufacturer and distributor of ice cream products PAI Partners 2013 / 2019 United Kingdom 2.5%
*3* *Datasite Global Corporation* Provider of SaaS software focused on virtual data rooms ICG 2024 United States 2.1%
*4* *Leaf Home Solutions* Provider of home maintenance services Gridiron 2016 United States 1.7%
*5* *Visma* Provider of business management software and outsourcing services Hg/
ICG 2024 Norway 1.7%
*6* *Chewy* Retailer of pet products and services BC Partners 2014 / 2015 United States 1.6%
*7* *European Camping Group* Operator of premium campsites and holiday parks PAI Partners 2021 / 2023 France 1.6%
*8* *Newton* Provider of management consulting services ICG 2021 / 2022 United Kingdom 1.5%
*9* *Precisely* Provider of enterprise software Clearlake/
ICG 2021 / 2022 United States 1.4%
*10* *Curium Pharma* Supplier of nuclear medicine diagnostic pharmaceuticals ICG 2020 United Kingdom 1.4%
*11* *Davies Group* Provider of speciality business process outsourcing services BC Partners 2021 United Kingdom 1.4%
*12* *IRI 2* Provider of mission-critical data and predictive analytics to consumer goods manufacturers New Mountain 2022 United States 1.3%
*13* *PSB Academy* Provider of private tertiary education ICG 2018 Singapore 1.2%
*14* *Ambassador Theatre Group* Operator of theatres and ticketing platforms ICG 2021 United Kingdom 1.2%
*15* *Yudo* Designer and manufacturer of hot runner systems ICG 2017 / 2018 South Korea 1.2%
*16* *Domus* Operator of retirement homes ICG 2017 / 2021 France 1.2%
*17* *David Lloyd Leisure* Operator of premium health clubs TDR 2013 / 2020 United Kingdom 1.2%
*18* *Crucial Learning* Provider of corporate training courses focused on communication skills and leadership development Leeds Equity 2019 United States 1.2%
*19* *ECA Group* Provider of autonomous systems for the aerospace and maritime sectors ICG 2022 France 1.1%
*20* *Planet Payment* Provider of integrated payments services focused on hospitality and luxury retail Advent/
Eurazeo/
ICG 2021 Ireland 1.0%
*21* *Ivanti* Provider of IT management solutions Charlesbank/
ICG 2021 United States 1.0%
*22* *Class Valuation* Provider of residential mortgage appraisal management services Gridiron 2021 United States 1.0%
*23* *Vistage* Provider of CEO leadership and coaching for small and mid-size businesses in the US Gridiron/
ICG 2022 United States 0.9%
*24* *Audiotonix* Manufacturer of audio mixing consoles PAI Partners 2024 United Kingdom 0.9%
*25* *KronosNet* Provider of tech-enabled customer engagement and business solutions ICG 2022 Spain 0.9%
*26* *Brooks Automation* Provider of semiconductor manufacturing solutions THL 2021 / 2022 United States 0.9%
*27* *DigiCert* Provider of enterprise security solutions ICG 2021 United States 0.9%
*28* *AML RightSource* Provider of compliance and regulatory services and solutions Gridiron 2020 United States 0.8%
*29* *Archer Technologies* Operator of private hospitals Cinven 2023 United States 0.8%
*30* *AMEOS Group* Operator of private hospitals ICG 2021 Switzerland 0.7% *Total of the 30 largest underlying investments* *39.7%*
The 30 largest fund investments by value
The table below presents the 30 largest fund investments by value at 31 July 2024. The valuations are net of underlying managers’ fees and carried interest.
*Fund* *Year of commitment* *Value £m* *Outstanding commitment £m*
*1* *PAI Strategic Partnerships *** Mid-market and large buyouts 2019 32.2 0.2
*2* *ICG Strategic Equities Fund III* GP-led secondary transactions 2018 31.1 10.8
*3* *CVC European Equity Partners VII* Large buyouts 2017 29.4 1.1
*4* *ICG Strategic Equities Fund IV* GP-led secondary transactions 2021 27.6 9.9
*5* *Gridiron Capital Fund III* Mid-market buyouts 2016 26.4 4.0
*6* *ICG Europe VII* Mezzanine and equity in mid-market buyouts 2018 29.3 5.0
*7* *ICG Ludgate Hill (Feeder B) SCSp* Secondary portfolio 2021 24.8 13.7
*8* *PAI Europe VII* Mid-market and large buyouts 2017 24.4 2.6
*9* *Gridiron Capital Fund IV* Mid-market buyouts 2019 24.0 0.6
*10* *Resolute IV* Mid-market buyouts 2018 23.3 1.0
*11* *ICG Augusta Partners Co-Investor *** Secondary fund restructurings 2018 21.9 17.1
*12* *Seventh Cinven* Large buyouts 2019 20.2 0.7
*13* *ICG Ludgate Hill III* Secondary portfolio 2022 20.0 5.5
*14* *ICG Europe VIII* Mezzanine and equity in mid-market buy-outs 2021 19.3 16.9
*15* *Oak Hill V* Mid-market buyouts 2019 18.2 0.9
*16* *Advent Global Private Equity IX* Large buyouts 2019 17.0 0.8
*17* *Graphite Capital Partners IX* Mid-market buyouts 2018 17.0 3.0
*18* *Graphite Capital Partners VIII ** Mid-market buyouts 2013 20.9 1.8
*19* *Resolute V* Mid-market buy-outs 2021 16.1 1.3
*20* *AEA VII* Mid-market buyouts 2019 16.1 0.5
*21* *Sixth Cinven Fund* Large buyouts 2016 15.3 2.9
*22* *ICG Ludgate Hill (Feeder) II Boston SCSp* Secondary portfolio 2022 14.9 5.2
*23* *Permira VII* Large buyouts 2019 14.0 1.3
*24* *Investindustrial VII* Mid-market buyouts 2019 13.8 4.3
*25* *BC European Capital X* Large buyouts 2016 13.3 1.4
*26* *ICG LP Secondaries Fund I LP* LP-led secondary transactions 2022 13.0 38.2
*27* *New Mountain Partners VI* Mid-market buy-outs 2020 12.4 1.2
*28* *Bowmark Capital Partners VI* Mid-market buyouts 2018 12.3 3.4
*29* *New Mountain Partners V* Mid-market buyouts 2017 11.4 1.1
*30* *CVC Capital Partners VIII* Large buyouts 2020 11.4 2.2 *Total of the largest 30 fund investments* *591.1* *158.6* *Percentage of total investment Portfolio* *42.0%* * - *
* Includes the associated top up funds
** All or part of interest acquired through a secondary purchase
*PRINCIPAL RISKS AND UNCERTAINTIES *
The principal risks and uncertainties facing the Company are substantially the same as those disclosed in the Strategic Report and in the notes to the Financial Statements in the Company’s latest Annual Report for the year ended 31 January 2024 which was approved by the Board on 7 May 2024.
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.
In addition to these, emerging risks are regularly considered to assess any potential impact on the Company and to
determine whether any actions are required. The Board also regularly considers the evolution of requirements and standards
relating to ESG and responsible investing.
*Related Party Transactions*
There have been no material changes in the related party transactions described in the 31 January 2024 Annual Report.
*Directors’ Responsibility Statement*
The Directors are responsible for preparing the Interim Report, in accordance with applicable laws and regulations. The Directors confirm that, to the best of their knowledge:
· The condensed interim financial statements have been prepared in accordance with UK-adopted IAS 34 Interim condensed financial statements and gives a true and fair view of the assets, liabilities, financial position and profit or loss of the Company;· The Chair’s Statement and Manager’s Review includes a fair review of the information required by DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed interim financial statements, and a description of the principal risks and uncertainties for the remaining six months of the year; and· The interim financial statements include a fair review of the information required by DTR 4.28R of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the first six months of the financial year and that have materially affected the financial position or performance of the Company during that period, and any changes in the related party transactions described in the last Annual Report that could do so.
The Interim Report was approved by the Board and the above Directors’ Responsibility Statement was signed on its behalf by the Chair.
*Jane Tufnell*
*Chair*
7 October 2024
*Unaudited Interim Financial Statements for the period ended 31 July 2024*
*INTERIM CONDENSED FINANCIAL STATEMENTS*
Income statement
*Half year to 31 July 2024 *
*(Unaudited)* *Half year to 31 July 2023*
* (Unaudited)* *Notes*
*Revenue*
*return*
*£’000*
*Capital return*
*£’000*
*Total*
*£’000*
*Revenue*
*return*
*£’000*
*Capital return*
*£’000*
*Total*
*£’000**Investment returns*
Income, gains and losses on investments 254 34,697 34,951 481 19,267 19,748
Deposit interest 29 - 29 324 - 324
Other income 5 - 5 78 - 78
Foreign exchange gains and losses - 741 741 - 38 38 *288* *35,438* *35,726* *883* *19,305* *20,188*
*Expenses*
Investment management charges (797) (7,172) (7,969) (802) (7,219) (8,021)
Other expenses including finance costs (1,283) (3,481) (4,764) (1,320) (3,899) (5,219) *(2,080)* *(10,653)* *(12,733)* *(2,122)* *(11,118)* *(13,240)*
*Profit/(loss) before tax* (1,792) 24,785 22,993 (1,239) 8,187 6,948
Taxation - - - 1,837 (1,837) -
*Profit/(loss) for the period* *(1,792)* *24,785* *22,993* *598* *6,350* *6,948*
*Attributable to:*
Equity shareholders *(1,792)* *24,785* *22,993* *598* *6,350* *6,948*
*Basic and diluted earnings per share* *34.67p* *10.21p*
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 guidance published by the AIC. There is no Other Comprehensive Income.
All profits are from continuing operations.
The notes on pages 25 to 27 form an integral part of the interim financial statements.
Balance sheet
*Notes*
*31 July*
*2024*
*(unaudited)*
*£’000*
*31 January*
*2024*
*(audited)*
*£’000*
*Non-current assets*
Investments held at fair value 7 *1,362,012* *1,296,382*
*Current assets*
Cash and cash equivalents 9,789 9,722
Prepayments and receivables 1,920 2,258 *11,709* *11,980*
*Current liabilities*
Borrowings (93,305) (20,000)
Payables (6,894) (5,139) (100,199) (25,139)
Net current assets/(liabilities) (88,490) (13,159)
*Total assets less current liabilities* *1,273,522* *1,283,223*
*Capital and reserves*
Share capital 7,292 7,292
Capital redemption reserve 2,112 2,112
Share premium 12,936 12,936
Capital reserve 1,255,707 1,263,616
Revenue Loss (4,525) (2,733)
*Total equity* *1,273,522* *1,283,223*
Net asset value per share (basic and diluted) 6 1,946.4p 1,909.4
The notes on pages 25 to 27 form an integral part of the interim financial statements.
The financial statements on pages 21 to 27 were approved by the Board of Directors on 7 October 2024 and signed on its behalf by:
*Jane Tufnell* *Alastair Bruce*
Director DirectorCash flow statement
*Half year to *
*31 July 2024 *
*(unaudited)*
*£’000* *Half year to *
*31 July 2023 *
*(unaudited)*
*(restated)*
*£’000*
*Operating activities*
Sale of portfolio investments 9,287 15,737
Purchase of portfolio investments (23,295) (13,705)
Cash flow to subsidiaries' investments (89,643) (52,921)
Cash flow from subsidiaries' investments 72,870 77,331
Interest income received from portfolio investments 200 294
Dividend income received from portfolio investments 52 296
Other income received 34 401
Investment management charges paid (8,006) (7,488)
Other expenses paid (1,007) (2,892)
*Net cash (outflow)/ inflow from operating activities* *(39,508)* *17,053*
*Financing activities*
Bank facility fee paid (1,362) (1,628)
Interest paid (414) (2,903)
Credit Facility utilised 92,378 90,087
Credit Facility repaid (18,412) (82,476)
Purchase of shares into treasury (21,456) (6,477)
Equity dividends paid (11,238) (10,886)
*Net cash inflow/ (outflow) from financing activities* *39,496* *(14,282)*
*Net (decrease)/ increase in cash and cash equivalents* *(12)* *2,771*
*Cash and cash equivalents at beginning of year* *9,722* *20,694*
Net (decrease)/ increase in cash and cash equivalents (12) 2,771
Effect of changes in foreign exchange rates 79 39
*Cash and cash equivalents at end of period* *9,789* *23,504*
The notes on pages 25 to 27 form an integral part of the interim financial statements.
Statement of changes in equity
*Share capital*
* £’000* *Capital redemption*
*reserve*
*£’000*
*Share premium*
*£’000*
*Capital reserve*
*£’000*
*Revenue*
* reserve*
*£’000* *Total *
*shareholders’*
*equity*
*£’000*
*Half year to 31 July 2024 *
*(Unaudited)*
Opening balance at 1 February 2024 7,292 2,112 12,936 1,263,616 (2,733) 1,283,223
Profit for the period and total comprehensive income — — — 24,785 (1,792) 22,993
Dividends paid or approved — — — (11,238) — (11,238)
Purchase of shares into treasury — — — (21,456) — (21,456)
*Closing balance at 31 July 2024* *7,292* *2,112* *12,936* *1,255,707* *(4,525)* *1,273,522*
*Share capital*
* £’000* *Capital redemption*
*reserve*
*£’000*
*Share premium*
*£’000* *Capital reserve *
*£’000*
*Revenue*
* reserve*
*£’000* *Total *
*shareholders’*
*equity*
*£’000*
*Half year to 31 July 2023*
* (Unaudited)*
Opening balance at 1 February 2023 7,292 2,112 12,936 1,279,751 (1,473) 1,300,618
Profit for the period and total comprehensive income — — — 6,350 597 6,948
Dividends paid or approved — — — (10,886) — (10,886)
Purchase of shares into treasury — — — (6,420) — (6,420)
*Closing balance at 31 July 2023* *7,292* *2,112* *12,936* *1,268,795* (875) *1,290,260*
The notes on pages 25 to 27 form an integral part of the financial statements.
*NOTES TO THE FINANCIAL STATEMENTS*
For the period ended 31 July 2024
*1 GENERAL INFORMATION*
These interim condensed 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 interim condensed financial statements are unaudited and do not comprise statutory accounts within the meaning of section 434 of the Companies Act 2006. Within the notes to the interim condensed financial statements, all current and comparative data covering the period to (or as at) 31 July 2024 is unaudited. Data given in respect of the year to 31 January 2024
is audited. The statutory accounts for the year to 31 January 2024 have been reported on by Ernst & Young LLP and delivered to the Registrar of Companies. The report of the auditors was (i) unqualified, (ii) did not contain an emphasis of matter paragraph, and (iii) did not contain any statements under section 498(2) or (3) of the Companies Act 2006.
*3 BASIS OF PREPARATION*
The interim financial statements have been prepared in accordance with UK-adopted IAS 34 Interim financial Reporting (IAS 34) and on the basis of the accounting policies and methods of computation set out in the financial statements of the Company for the year to 31 January 2024.
The financial information for the year ended 31 January 2024 was prepared in accordance with UK-adopted International Accounting Standards (‘UK-IAS’) and the Statement of Recommended Practice ('SORP') for investment trusts issued by the Association of Investment Companies in July 2022.
The Company comprises one operating segment which is also a reporting segment.
*Going concern*
These financial statements have been prepared on a going concern basis. In making their going concern assessment, the Directors have considered the potential impact of principal risks on the Company’s business activities; the Company’s net cash position; the availability of the Company’s credit facility and compliance with its covenants; and the Company’s cash flow projections, in particular those arising from committed but undrawn commitments.
The Directors have concluded based on the above assessment that the preparation of the interim condensed financial statements on a going concern basis, to 31 October 2025, a period of more than 12 months from the signing of the interim condensed financial statements, continues to be appropriate.
*4 DIVIDENDS*
*Half year to *
*31 July *
*2024 *
*£’000* *Half year to *
*31 July *
*2023 *
* £’000*
Third Quarterly dividend in respect of year ended 31 January 2024 of 8.0p per share (2023: 7.0p) 5,345 4,781
Final dividend in respect of year ended 31 January 2024 of 9.0p per share (2023: 9.0p) 5,894 6,105
*Total* *11,239* *10,886*
The Board has approved an interim dividend for the quarter to 30 April 2024 of 8.5p per share (totalling £5.56m) which has been paid on 30 August to shareholders on the register on 16 August 2024. The Board has proposed a second interim dividend of 8.5p per share in respect of the year ended 31 January 2025 which will be paid on 29 November 2024 to shareholders on the register at the close of business on 15 November 2024.
*5 EARNINGS PER SHARE*
Earnings per share *Half year to 31 July 2024* *Half year to 31 July 2023*
Revenue return per ordinary share (2.70)p 0.88p
Capital return per ordinary share 37.38p 9.33p
Earnings per ordinary share (basic and diluted) 34.67p 10.21p
Weighted average number of shares *66,310,774* 68,040,279
Revenue return per ordinary share is calculated by dividing the revenue return attributable to equity shareholders of £-1.8m (2023: £0.6m) by the weighted average number of ordinary shares outstanding during the year.
Capital return per ordinary share is calculated by dividing the capital return attributable to equity shareholders of £24.8m (2023: £6.4m) by the weighted average number of ordinary shares outstanding during the year.
Basic and diluted earnings per ordinary share are calculated by dividing the earnings attributable to equity shareholders of £23.0m (2023: £6.9m) by the weighted average number of ordinary shares outstanding during the year..
The weighted average number of ordinary shares outstanding (excluding those held in treasury) during the year was 66,310,774 (2023: 68,040,279). There were no potentially dilutive shares, such as options or warrants, in either year.
*6 NET ASSET VALUE PER SHARE *
The net asset value per share is calculated on equity attributable to equity holders of £1,273.5m (31 January 2024: £1,300.6m) and on 65,429,867 (31 January 2024: 67,204,867) ordinary shares in issue at the period end. There were no potentially dilutive 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 1,946.4p (31 January 2024: 1,909.4p).
*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 3 assets are described in note 1(c) of the annual financial statements. No investments were categorised as level 1 or level 2.
The Company’s policy is to recognise transfers into and transfers out of fair value hierarchy levels at the end of the reporting year when they are deemed to occur.
The following table presents the assets that are measured at fair value at 31 July 2024 and 31 January 2024:
*Level 1* *Level 2* *Level 3* *Total*
*31 July 2024* *£’000* *£’000* *£’000* *£’000*
Investments held at fair value
Unquoted investments - - 281,766 281,766
Quoted investments - - - -
Subsidiary undertakings - - 1,080,246 1,080,246
*Total investments held at fair value* *-* *-* *1,362,012* *1,362,012*
*Level 1* *Level 2* *Level 3* *Total*
*31 January 2024* *£’000* *£’000* *£’000* *£’000*
Investments held at fair value
Unquoted investments - - 260,296 260,296
Quoted investments - - - -
Subsidiary undertakings - - 1,036,086 1,036,086
*Total investments held at fair value* - *-* *1,296,382* *1,296,382*
All unquoted and quoted investments are valued at fair value in accordance with IFRS 13. The Company has no quoted investments as at 31 July 2024; quoted investments held by subsidiary undertakings are reported within Level 3.
Investments in level 3 securities are in respect of private equity fund investments and co-investments. These are held at fair value and are calculated using valuations provided by the underlying manager of the investment, 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 following tables present the changes in level 3 instruments for the period ended 31 July 2024 and 31 July 2023.
*Half year to *
*31 July 2024*
*£’000* *Half year to *
*31 July 2023*
*£’000*
Opening balances 1,296,382 1,349,075
Additions 104,356 64,055
Disposals (82,158) (86,090)
Gains and losses recognised in profit or loss 43,432 15,617
*Closing balances* *1,362,012* *1,342,657*
GLOSSARY
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.
Cash drag Cash drag is the negative impact on performance arising as a result of the allocation of a portion of the entity’s assets to cash.
Co-investment Co-investment is a Direct Investments 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 investor agrees to contribute to a fund or a specific investment.
Compound Annual Growth Rate CAGR The rate of return that would be required for an investment to grow from its beginning balance to its ending balance, assuming the profits were reinvested at the end of each period of the investment's life span.
Deployment Please see ‘Total new investment’.
Direct Investments An investment in a portfolio company held directly, not through a private equity fund. Direct Investments are typically co-investments with a private equity fund.
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%.
Dividend Dividend is a distribution of a portion of a Company’s earnings to its shareholders. Dividends are usually paid in cash, and are determined by the Company’s board of directors.
Drawdowns Drawdowns are amounts invested by the Company 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.Enlarged Perimeter As well as performance metrics for our Top 30 companies, we include data for our "Enlarged Perimeter", which represents the aggregate value of the Top 30 Companies and as many of the managers from within the Top 30 funds as practicable.
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.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 timeframe of the immediately preceding 12 months in reference to financial metrics used 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 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.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 include 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 and debt retained on our balance sheet.
The value of the Portfolio at 31 July 2024 is £1,401.8m (31 January 2024: £1,349.0m). 31 July 2024 £m IFRS Balance sheet fair value Net assets of subsidiary limited partnerships Co-investment Incentive Scheme Accrual Total Company and subsidiary Limited Partnership Investments^1 1,362.0 (7.5) 47.3 1,401.8 Cash 9.8 9.8 Other Net Liabilities (98.3) 7.5 (47.3) (138.0) Net assets 1,273.5 1,273.5 31 J