TIDMAPAX
RNS Number : 6760X
Apax Global Alpha Limited
14 August 2018
(LSE: APAX)
Apax Global Alpha Limited
Unaudited interim results for the half-year ended 30 June
2018
For further information regarding the announcement of AGA's 2018
interim results, including the details for today's analyst and
investor webcast at 9.30am (UK time), please visit
www.apaxglobalalpha.com
Key highlights
-- Total NAV Return(1) of +6.0%, (+5.2% on a constant currency basis)
-- Adjusted NAV(2) increased by EUR31.5m to EUR943.9m during the
six months to 30 June 2018 mainly driven by a higher positive
contribution from Private Equity
-- Adjusted NAV per share of EUR1.92 (GBP1.70), compared to
EUR1.86 (GBP1.65) as at 31 December 2017
-- First semi-annual dividend of 4.33 pence per share declared,
equivalent to 2.5% of euro NAV at 30 June 2018. Dividend of
GBP21.3m will be paid on 14 September 2018
-- AGA was 104% invested and had a cash balance of EUR16.9m.
Revolving credit facility drawn by EUR39.9m
-- Following the third lock-up release, AGA's free float increased to c.60%
Performance highlights
-- Portfolio delivered a Total NAV Return of +6.0% in 1H18,
Private Equity contributed +6.0%, and Derived Investments
contributed -0.1%. Costs and performance fee adjustments were -0.7%
with FX contributing +0.8%
-- Derived Debt Investments contributed +0.2% and Derived Equity -0.3% to Total NAV Return
Adjusted NAV(2) movements Private Derived Cash Revolving Other Total
Equity Investments credit EURm
EURm EURm EURm facility EURm
Adjusted NAV at 31 December
2017 586.1 307.2 19.0 - 0.1 912.4
------------------------------- -------- ------------- -------- ---------- ------- -------
+ Investments 11.1 132.6 (131.2) - (12.5) -
------------------------------- -------- ------------- -------- ---------- ------- -------
- Divestments (22.3) (101.8) 122.0 - 2.1 -
------------------------------- -------- ------------- -------- ---------- ------- -------
+ Interest and dividend
income - - 10.1 - (0.5) 9.6
------------------------------- -------- ------------- -------- ---------- ------- -------
+/- Unrealised gains/(losses) 54.8 (17.8) - - - 37.0
------------------------------- -------- ------------- -------- ---------- ------- -------
+/- Realised gains - 7.0 - - - 7.0
------------------------------- -------- ------------- -------- ---------- ------- -------
+/- FX gains/(losses)(3) 5.0 4.4 (1.6) (0.4) - 7.4
------------------------------- -------- ------------- -------- ---------- ------- -------
+/- Costs and other movements - - (2.6) - (2.2) (4.8)
------------------------------- -------- ------------- -------- ---------- ------- -------
- Dividends paid - - (22.9) - - (22.9)
------------------------------- -------- ------------- -------- ---------- ------- -------
+/- Performance fee reserve 3.4 10.2 (15.4) - - (1.8)
------------------------------- -------- ------------- -------- ---------- ------- -------
+/- Revolving credit facility
drawn/repaid - - 39.5 (39.5) - -
------------------------------- -------- ------------- -------- ---------- ------- -------
Adjusted NAV at 30 June
2018 638.1 341.8 16.9 (39.9) (13.0) 943.9
------------------------------- -------- ------------- -------- ---------- ------- -------
Investment activity highlights
-- Private Equity represented 65% of the invested portfolio and
Derived Investments represented 35%, unchanged from end 2017
-- Private Equity had five new closed investments, one add-on
and one full completed exit with another two signed, while Derived
Investments had 14 new positions, one add-on, and nine
divestments(4)
-- FX exposure c.51% to US dollar denominated investments (c.49% in December 2017)
Invested Portfolio analysis(5) EURm EURm % %
Private Equity 638.8 65%
=============================== ===== ===== ==== ====
* AMI 16.8 2%
=============================== ===== ===== ==== ====
* AEVI 6.2 0%
=============================== ===== ===== ==== ====
* AEVII 62.5 6%
=============================== ===== ===== ==== ====
* AVIII 409.7 42%
=============================== ===== ===== ==== ====
* AIX 144.6 14%
=============================== ===== ===== ==== ====
* ADF (1.0) 1%
=============================== ===== ===== ==== ====
Derived Investments 344.9 35%
=============================== ===== ===== ==== ====
* Derived Debt 184.3 19%
=============================== ===== ===== ==== ====
* Derived Equities 160.6 16%
=============================== ===== ===== ==== ====
Total 983.7 983.7 100% 100%
=============================== ===== ===== ==== ====
Private Equity portfolio highlights
-- Total Return for the Private Equity portfolio was 11.0%
(10.1% on a constant currency basis) over the six month period
-- The Apax Funds returned EUR22.3m to AGA whilst EUR11.1m was
invested in additional carried interest holdings; comprising of
EUR7.7m in AEVII and EUR3.4m into a new carried interest holding in
AEVI
-- Unrealised gains were EUR54.8m and favourable FX movements
were EUR5.0m and includes gains from the sale of Genex
-- Apax IX closed one investment, Apax Digital Fund closed two
investments, AMI Opportunities Fund closed two investments
-- Gross IRR generated on three fully exited investments was 53.4%(6)
-- FX exposure was c.46% in US dollar denominated investments
-- Sector exposure spread across all Apax Partners' focus
industries. Tech & Telco and Services were the most heavily
weighted sectors, accounting for 32% and 31% respectively of the
invested portfolio
-- Largest geographic bias in the portfolio was North America,
representing 42% of the invested portfolio
Derived Investments portfolio highlights
-- Total Return for the Derived Investments portfolio was -0.6%
(-1.9% on a constant currency basis) over the six month period
reflecting weaker markets
-- AGA fully exited three debt investments and six equity
investments generating proceeds of EUR101.8m in the period
-- Unrealised losses were EUR17.8m, realised gains were EUR7.0m
and there were favourable FX movements of EUR4.4m
-- AGA completed seven new investments in debt, seven new equity
investments and one add-on investment in equity amounting to
EUR132.6m
-- Gross IRR on Derived Debt exits was 12.6%(7) and on Derived Equity exits was 7.7%(7)
-- FX exposure was c.61% in US dollar denominated investments
-- Sector exposure spread across all Apax Partners' focus
industries. Tech & Telco and Services were the most heavily
weighted sectors, both accounting for 30% of the invested
portfolio
-- Geographic skew towards North America increased by 4% to 60%
-- Portfolio split between Derived Debt and Derived Equity was 53% and 47%, respectively
Commenting on the results, Tim Breedon CBE, Chairman of Apax
Global Alpha, said:
"AGA produced a stronger performance in the first half of 2018.
The Private Equity portfolio added value through unrealised gains
as the strength of the underlying companies is starting to be
reflected in the reported performance."
Commenting on AGA's investment focus, Ralf Gruss, COO of Apax
Partners, said:
"We are pleased to see strong operational performance of the
Private Equity portfolio not only translating into valuation
increases over the period, but value also crystallised through
strong exits from divestments of Genex, GlobalLogic, and Azelis.
Markets for Derived Investments showed higher volatility during the
period which may create opportunities for investment activity going
forward."
For more information, the Company's 2018 Interim Report and
presentation are available to view at: www.apaxglobalalpha.com
Contact details
Investor enquiries Media enquiries
Sarah Wojcik Andrew Kenny
IR Manager - AGA Head of Communications
Telephone: +44 (0)20 7666 6573 Telephone: +44 (0) 20 7872 6371
Email: sarah.wojcik@apax.com Email: andrew.kenny@apax.com
Footnotes
1. Total NAV Return means the movement in the Adjusted NAV per
share over the period plus any dividends paid. Total Return
reflects the sub-portfolio performance on a stand-alone basis. It
excludes items at overall AGA level such as cash, management fees
and costs
2. Adjusted NAV represents NAV of EUR947.8m adjusted for the
performance fee reserve of EUR3.9m at 30 June 2018
3. FX on cash includes the revaluation of cash balances and net
losses arising from the differences in exchange rates between
transaction dates and settlement dates, and unrealised net losses
arising from the translation into euro of assets and liabilities
(other than investments) which are not denominated in euro
4. Represents full exits only
5. Invested Portfolio analysis excludes cash and cash
equivalents, revolving credit facility drawn and net current
assets; including these the NAV is EUR947.8m. Adjusted NAV excludes
the performance fee reserve of EUR3.9m and is EUR943.9m at 30 June
2018
6. Gross IRR for Private Equity calculated concurrently based on
the aggregate euro cash flows of the Apax Funds for the three
positions
7. Gross IRR calculated based on aggregate euro cash flows since
inception of deals realised during the period (inclusive of two
partial debt exits and one partial equity exit)
Notes
1. Note that references in this announcement to Apax Global
Alpha Limited have been abbreviated to "AGA" or "the Company".
References to Apax Partners LLP have been abbreviated to "Apax
Partners" or "the Investment Adviser"
2. Please be advised that this announcement may contain inside
information as stipulated under the Market Abuse Regulations (EU)
NO. 596/2014 ("MAR")
3. This announcement is not for release, publication or
distribution, directly or indirectly, in whole or in part, into or
within the United States or to "US persons" (as defined in
Regulation S under the United States Securities Act of 1933, as
amended (the "Securities Act")) or into or within Australia,
Canada, South Africa or Japan. Recipients of this announcement in
jurisdictions outside the UK should inform themselves about and
observe any applicable legal requirements in their jurisdictions.
In particular, the distribution of the announcement may be
restricted by law in certain jurisdictions.
4. The information presented herein is not an offer for sale
within the United States of any equity shares or other securities
of Apax Global Alpha Limited ("AGA"). AGA has not been and will not
be registered under the US Investment Company Act of 1940, as
amended (the "Investment Company Act"). In addition, AGA's shares
(the "Shares") have not been and will not be registered under the
Securities Act or any other applicable law of the United States.
Consequently, the Shares may not be offered or sold or otherwise
transferred within the United States, or to, or for the account or
benefit of, US Persons, except pursuant to an exemption from the
registration requirements of the Securities Act and under
circumstances which will not require AGA to register under the
Investment Company Act. No public offering of the Shares is being
made in the United States
5. This announcement may include forward-looking statements. The
words "expect", "anticipate", "intends", "plan", "estimate", "aim",
"forecast", "project" and similar expressions (or their negative)
identify certain of these forward-looking statements. These
forward-looking statements are statements regarding AGA's
intentions, beliefs or current expectations concerning, among other
things, AGA's results of operations, financial condition,
liquidity, prospects, growth and strategies. The forward-looking
statements in this presentation are based on numerous assumptions
regarding AGA's present and future business strategies and the
environment in which AGA will operate in the future.
Forward-looking statements involve inherent known and unknown
risks, uncertainties and contingencies because they relate to
events and depend on circumstances that may or may not occur in the
future and may cause the actual results, performance or
achievements of AGA to be materially different from those expressed
or implied by such forward looking statements. Many of these risks
and uncertainties relate to factors that are beyond AGA's ability
to control or estimate precisely, such as future market conditions,
currency fluctuations, the behaviour of other market participants,
the actions of regulators and other factors such as AGA's ability
to continue to obtain financing to meet its liquidity needs,
changes in the political, social and regulatory framework in which
AGA operates or in economic or technological trends or conditions.
Past performance should not be taken as an indication or guarantee
of future results, and no representation or warranty, express or
implied, is made regarding future performance. AGA expressly
disclaims any obligation or undertaking to release any updates or
revisions to these forward-looking statements to reflect any change
in AGA's expectations with regard thereto or any change in events,
conditions or circumstances on which any statement is based after
the date of this announcement, or to update or to keep current any
other information contained in this announcement. Accordingly,
undue reliance should not be placed on the forward-looking
statements, which speak only as of the date of this
announcement
About Apax Global Alpha Limited
AGA is a Guernsey registered closed-ended collective investment
scheme incorporated as a non-cellular company that listed on the
London Stock Exchange on 15 June 2015. It is regulated by the
Guernsey Financial Services Commission.
AGA's objective is to provide shareholders with capital
appreciation from its investment portfolio and regular dividends.
The Company is targeting an annualised Total Return, across
economic cycles, of 12-15% (net of fees and expenses) including a
dividend yield of 5% of Net Asset Value.
The investment policy of the Company is to make Private Equity
investments in Apax Funds, and Derived Investments which are
investments in equities and debt derived from the insights gained
via Apax Partners' Private Equity activities. The Company's
portfolio is expected to be allocated in approximately equal
proportions between Private Equity and Derived Investments,
although the investment mix will fluctuate over time due to market
conditions, investment opportunities, cash flow requirements, the
dividend policy and other factors. Further information regarding
the Company and its publications are available on the Company's
website at www.apaxglobalalpha.com.
About Apax Partners LLP
Apax Partners is a leading global private equity advisory firm
and over its more than 35-year history, Apax Partners has raised
and advised funds with aggregate commitments of almost EUR43
billion as at 30 June 2018. Funds advised by Apax Partners invest
in companies across four global sectors of Tech & Telco,
Services, Healthcare and Consumer. These funds provide long--term
equity financing to build and strengthen world--class companies.
For further information about Apax Partners, please visit
www.apax.com.
Apax Partners is authorised and regulated by the Financial
Conduct Authority in the UK.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR UOORRWSAWAUR
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