3i Group PLC FY2016 Q1 performance update (3637U)
July 29 2015 - 2:01AM
UK Regulatory
TIDMIII
RNS Number : 3637U
3i Group PLC
29 July 2015
29 July 2015
3i Group plc - FY2016 Q1 performance update
3i Group plc ("the Group" or "3i") today issues its performance
update relating to the first quarter from 1 April 2015 to 30 June
2015 ("the quarter") of FY2016.
3i makes a positive start to the year with good portfolio performance
and realisations
* NAV per share of 400 pence after a 9 pence deduction
for foreign exchange translation
* Realised GBP229 million from Private Equity assets
* Announced two new investments in Private Equity
* Continued progress in new product development in Debt
Management
* The portfolio continues to perform well with Action
and 3i Infrastructure plc in particular supporting
good unrealised value growth
Simon Borrows, Chief Executive, commented:
"This was a productive first quarter for 3i with good levels
of activity across all three business lines. Our Private Equity
portfolio continued to perform well and saw good earnings growth
and realisations. Our Debt Management team made good progress
on fundraising and new product development and Infrastructure
continued to develop its investment pipeline.
While our portfolio valuations continue to be affected by the
strength of sterling and we cannot be immune to wider political
and economic conditions, the favourable transaction market enabled
us to realise a number of smaller assets at attractive valuations
and we leveraged our sector expertise to announce two new Private
Equity investments at sensible prices."
Private Equity
The Private Equity team had a busy quarter and we announced the
investment of c.GBP225 million of proprietary capital in two new
companies within the Northern European industrials sector. Both
investments were brought at sensible prices and are expected to
complete in the second quarter.
Market conditions continued to create opportunities to realise a
number of smaller investments at attractive valuations and 3i
generated total cash proceeds in the quarter of GBP229 million.
This represents an uplift of 5% to the 31 March 2015 valuation and
an average money multiple of 1.7x. Notable cash realisations in the
quarter included the full divestment of Azelis, a return of capital
from Scandlines following the sale of the route between Helsingor
and Helsingborg and the IPO of UFO Moviez.
3i realised proceeds
Full realisations
=====================
Azelis GBP62m
=====================
Touchtunes GBP38m
=====================
Soyaconcept GBP17m
=====================
Boomerang GBP11m
=====================
Inspecta GBP6m
=====================
Partial realisations
=====================
Scandlines GBP38m
=====================
Quintiles GBP27m
=====================
UFO Moviez GBP17m
=====================
Other GBP13m
=====================
Total GBP229m
=====================
The Private Equity portfolio continued to perform well and
weighted average earnings growth remained stable at 19%. Excluding
Action, this measure was 17% and it benefited from further
portfolio acquisitions largely funded from the portfolio's own
resources. The value weighted average multiple used to value the
portfolio also increased slightly to 10.7x post discount (March
2015: 10.5x), despite the volatility seen in the financial markets,
due to the contribution from our larger, more highly rated assets
and the disposal of a number of smaller lower rated assets.
Excluding Action the post discount value weighted average was 9.5x
(March 2015: 9.3x).
The portfolio valuation continued to be impacted by the strength
of sterling against the euro and US dollar which offset the value
growth seen in the quarter.
Infrastructure
The 3i Infrastructure plc ("3iN") share price increased by 5% to
168 pence at 30 June 2015 following its strong set of full year
2015 results. The Infrastructure team continued to develop its
pipeline of new investment opportunities, targeting investments in
mid-market economic infrastructure, primary PPP and low-risk energy
projects. In early July 2015 it was announced that 3iN would buy
50% of Esvagt for approximately GBP109 million.
Debt Management
Fee income remained strong in the quarter, with the majority of
the funds continuing to pay both senior and subordinated fees and
the FY2015 fund launches adding to total fee income.
The team announced the launch of its new Global Floating Rate
Income Fund with US$75 million of seed capital from 3i. The fund,
an open ended senior debt fund that invests across the US and
Europe, launched with a total of US$150 million under management
and marks a further step to diversify into complementary products.
In addition 3i invested GBP45 million into two CLO warehouses both
of which are expected to close in August 2015.
Top 10 investments by value at 30 June 2015
Valuation(1) Valuation(1)
Valuation Valuation Mar-15 Jun-15
basis currency GBPm GBPm Activity in the quarter
=========== =========== ============= ============= ============================
Action Earnings Euro 592 618
=========== =========== ============= ============= ============================
3i Infrastructure
plc Quoted GBP 481 503
=========== =========== ============= ============= ============================
GBP47m proceeds and
income, net of transaction
fees, following the
Scandlines DCF Euro 262 215 route sale
=========== =========== ============= ============= ============================
Amor / Christ Earnings Euro 165 166
=========== =========== ============= ============= ============================
Element Earnings USD 145 154
=========== =========== ============= ============= ============================
Mayborn Earnings GBP 133 135
=========== =========== ============= ============= ============================
Sold 20% and generated
Quintiles Quoted USD 144 117 proceeds of GBP27m
=========== =========== ============= ============= ============================
ACR Other USD 120 115
=========== =========== ============= ============= ============================
Q Holdings Earnings USD 109 109
=========== =========== ============= ============= ============================
Basic-Fit Earnings Euro 102 102
=========== =========== ============= ============= ============================
(1) Balance sheet values are stated after foreign exchange
translation.
The top 10 investments comprise 59% (31 March 2015: 58%) of the
total Proprietary Capital portfolio by value.
Total return and NAV position
Value growth from the Private Equity portfolio and 3iN resulted
in an increase in diluted NAV per share to 400 pence (31 March
2015: 396 pence), after recording a foreign exchange translation
loss of GBP84 million in the quarter due to sterling strengthening
relative to both the euro and the US dollar. As at 30 June 2015, a
1% movement in the euro and US dollar would result in a total
return movement of GBP17 million and GBP8 million respectively.
Balance sheet and dividend
The Group's balance sheet remains strong. The continued
realisation activity means that the net cash position increased to
GBP214 million at the quarter end before the payment of the FY2015
final dividend of 14 pence per share on 24 July 2015. Gross debt
and liquidity are stable and were GBP812 million and GBP1,376
million respectively at 30 June 2015.
- Ends -
For further information, please contact:
Silvia Santoro
Investor Relations Director
Tel: 020 7975 3258
Kathryn van der Kroft
Communications Director
Tel: 020 7975 3021
About 3i Group
3i is a leading international investment manager focused on
mid-market Private Equity, Infrastructure and Debt Management. Our
core investment markets are northern Europe and North America. For
further information, please visit: www.3i.com.
All statements in this performance update relate to the three
month period ended 30 June 2015 unless otherwise stated. The
financial information is unaudited and is presented on 3i's
non-GAAP Investment basis in order to provide users with the most
appropriate description of the drivers of 3i's performance. Net
asset value ("NAV") and total return are the same on the Investment
basis and on an IFRS basis. Details of the differences between 3i's
consolidated financial statements prepared on an IFRS basis and
under the Investment basis are provided in the 2015 Annual Report
and Accounts. There have been no material changes to the financial
position of 3i from the end of this quarter to the date of this
announcement.
Notes
1. Uplift on opening value represents the cash proceeds in the
quarter over opening value realised.
2. Money multiple over cost represents the cash proceeds
(including income) over cash invested. For partial divestments, the
valuation of the remaining investment is included in the
multiple.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCRPMRTMBTTBTA
3i (LSE:III)
Historical Stock Chart
From Mar 2024 to Apr 2024
3i (LSE:III)
Historical Stock Chart
From Apr 2023 to Apr 2024
