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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| F&C Private Equity Trust | LSE:FPEO | London | Ordinary Share | GB0030738271 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 336.00 | 331.00 | 337.00 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
TIDMFPEO
RNS Number : 2345G
F&C Private Equity Trust PLC
25 May 2017
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25 May 2017
F&C Private Equity Trust plc
Quarterly results for the three months to 31 March 2017 (unaudited)
-- Share price total return for the three months of 8.0 per cent for the Ordinary Shares. -- New co-investments totalling GBP15 million -- Positive outlook for remainder of 2017
Manager's Review
Introduction
At 31 March 2017 the net asset value ('NAV') of the Company was GBP259.5 million, giving a fully diluted NAV per ordinary share of 350.99p, virtually unchanged over the quarter. At that time the Company had net cash of GBP32.0 million. Outstanding undrawn commitments stood at GBP120.4 million at the end of the period. Of this GBP17.2 million is to funds where the investment period has expired and hence only a small proportion of this amount is expected to be drawn.
New Investments
During the quarter we made two new fund commitments and after the quarter end we made a further two fund commitments. The total of drawdowns and co-investments was GBP10.7 million for the quarter.
After an extended review of US mid-market opportunities we found some fresh investments to add to our modest, but enduring exposure to this important market. $6.0 million was committed to US based manager Graycliff for its fund III. Graycliff, which is a spin out of HSBC's private equity business, specialises in US private companies with enterprise values between $20 million and $100 million. After the quarter end, we committed $4.0 million to Stellex Capital Partners, a primarily US focused fund investing into mid-market distressed and special opportunities. The management team previously worked together for many years within the Carlyle Group.
In Europe we have reinforced our exposure to the Nordic region by committing EUR6.0 million to Finnish fund Vaaka III. This is the second time we have invested with Vaaka into the distinctive, but promising, Finnish private equity market. After the quarter end, we committed EUR6.0 million to Paris-based leading mid-market specialist Chequers for their fund XVII. We have been an investor in each Chequers fund since its first independent fund in 2002. It has one of the largest and most experienced investment teams in France and their performance record justifies continued support.
We have added to the co-investment portfolio in accord with our objective of gradually raising the proportion of the portfolio in this type of direct investment. We invested $5.0 million (GBP4 million) for 6% of Sigma Electric Manufacturing, a North Carolina based leading manufacturer of metal castings, precision machined components and sub-assemblies for the US low voltage electrical products market. The company's distribution is largely US and its factories are in India. The investment is led by US mid-market managers Argand. The investment has started well with trading comfortably ahead of budget.
After the quarter end, two further co-investments have been added. We have invested GBP6.2 million for 62.7% of Weird Fish, a UK premium life-style clothing brand. The investment is led by Total Capital Partners. The Weird Fish brand is positioned in the growing active lifestyle segment, serving both men and women and focusing on the 'stable and affluent' 35 - 55 age demographic. Previously owned by Piper Private Equity through its Fund IV, in which we are an investor, the company is well positioned for growth. Also after the quarter end, we invested GBP5.0 million for 15.9% of TWMA an offshore oil services company involved in drilling waste management solutions. The core of TWMA's business is using a thermomechanical cylindrical mill to process drill cuttings, separating the oil, water and solid powder elements such that the water and powder can be safely discharged below the waterline and the oil can be reused. The company, which is based in Aberdeen, operates internationally both offshore and onshore and is focused on further geographic expansion. The investment is led by Buckthorn, who are specialists in the energy sector.
The funds in our portfolio have been active with a total of GBP6.7 million drawn for investment. This went into around 15 companies across a range of sectors and geographies. The larger drawdowns include a typically diverse range of companies. Agilitas 2015 Private Equity Fund called GBP0.7 million for Exemplar, a north of England based, high acuity nursing care provider. Lyceum Capital III called GBP0.5 million for Timico, a provider of IT hosting, network connectivity and mobile solutions with a particular focus on medium sized companies. Piper Private Equity VI called GBP0.5 million for Flat Iron Steak Ltd, a restaurant chain. In Germany Capvis IV called GBP0.3 million for Fels, a manufacturer of cold form metal processing machines used in the automotive sector. In Italy Capvis IV called GBP0.3 million for Gotha, a developer and manufacturer of cosmetics products. In the Nordic region Summa I called GBP0.4 million for its first two investments; e-Gain, a climate controlled heating systems for buildings specialist and Sortera, a building waste collection and sorting provider of containers and building bags.
Realisations
The total realisations for the quarter amounted to GBP20.0 million including GBP0.3 million of income. The largest exit was GBP7.6 million from the sale of Park Holidays, which completed in February. This Caledonia Investments-led co-investment was highly successful with the company increasing profits by over 50% during the holding period of less than three years. The caravan park holiday sector has proved very robust benefitting from a trend towards 'staycations' and from a general upgrade in the range of facilities available. Including previously received distributions this investment delivered an excellent 2.8x cost and an IRR of 48%. Another of our co-investments, Ticketscript, the cloud based event ticketing Saas company, had a partial exit when it was sold to larger competitor Eventbrite. GBP0.5 million has been returned on the merger at a valuation of 2.0x cost. We now have Eventbrite stock and there is excellent scope for a further attractive return from here.
There was a healthy flow of exits from funds as well. Stirling Square Capital Partners II exited Netherlands-based waste container company ESE through its sale to UK listed company RPC. Our proceeds were GBP3.3 million, representing 2.8x cost and an IRR of 17%. In France, Chequers Capital XV sold Accelya, provider of IT services to the air transport industry, to strategic buyer Mercator. Our proceeds of the final stage of the sale following a recapitalisation in 2014 are GBP1.5 million. Altogether the investment returned 11.7x cost and an IRR of 36%. Chequers Capital XVI exited hairdressing chain Provalliance through its sale to the founding Provost family. Proceeds were GBP0.5 million representing 2.1x cost and an IRR of 19%. Also in France, Ciclad 4 sold topographical software company Geomedia to a management buy-in, returning GBP0.4 million, representing a return of 3.4x cost and an IRR of 17%. In Italy Progressio II sold Duplomatic, maker of hydraulic valves, pumps and oil pressure activated systems returning GBP0.8 million representing 2.3x and a 25% IRR. Further afield, in the US, Camden Partners III exited schools assessment provider Questar through its sale to Educational Testing Service. These and several other smaller realisations made for a strong quarter for realisations.
Valuation Changes
There were a limited number of significant valuation changes over the quarter. Some of the larger exits have already been incorporated in the previous valuation. Our co-investment in funeral plans business Avalon, is trading very well and has been uplifted by GBP0.8 million. The new co-investment in Sigma has also been uplifted in line with the manager's valuation. The investment had been held by Argand for six months before the syndication to us and during that period it has made good fundamental progress, sufficient to justify an uplift of GBP0.8 million. The collection of Italian funds acquired as a secondary has performed well with the exit of Duplomatic noted above, but there were also trading related uplifts for Italian travel business Alpitour, which is held in ILP III and chemicals company Industrie Chimiche Forestali, which is held in Progressio II. Collectively these contributed to an uplift of GBP0.7 million. Capvis III is uplifted by GBP0.4 million, reflecting the share price performance of vacuum valves company VAT Group where the fund continues to hold some shares following its recent listing. Inflexion 2010 is up by GBP0.3 million due to positive trading by a number of holdings. Camden Partners IV benefited from a recent exit of Communication Education Centres, a prisoners' education service, and is uplifted by GBP0.3 million.
There have been a few downward valuations. Amongst these is a downgrade of GBP0.2 million for Hutton Collins III, in large part reflecting continuing challenges at Byron Burgers. Our co-investment in Norwegian software company Safran, is down by GBP0.1 million due to pressure on consulting revenues, many of which are oil and oil services related.
Financing
The Company ends the first quarter in a strong financial position. Cash balances stand at GBP57.2 million and after adjusting for the term loan of GBP25.2 million, the net cash position is GBP32.0 million. This is equivalent to net cash of 14.1%. The total borrowing facility is GBP70 million, meaning that the Company has substantial immediately available resources. Despite the current net cash position, it remains the Company's policy to be fully invested with a modestly geared position. The Company's broad portfolio makes this sustainable over the long term and our expectation is that returns from our investments will comfortably exceed the costs of borrowing thus enhancing shareholders' returns.
Outlook
The start of 2017 has seen healthy levels of activity in both new investments and realisations in the Company's portfolio and across the wider market. We expect to add to our stock of co-investments steadily over the year and to invest selectively in both secondary and primary funds. Over recent months the private equity sector has displayed considerable resilience against an economic and political background which has proved unusually unpredictable. Despite this, confidence is high amongst private equity investors and together with company management teams they routinely plan for a range of outcomes which may affect their respective industries and businesses in different ways. With a number of important elections in Europe taking place during 2017 and with the Brexit negotiations now in train, such planning, both long term and contingent is as important as ever. In the private equity sector the close relationship between investors and management and the inherent flexibility and freedom of action which this brings means that companies can evolve and adapt in ways that would challenge public companies. The indications from our investment partners are that they are facing the remainder of 2017 in a positive frame of mind and this in turn gives us confidence that the Company will make further good progress for shareholders.
Hamish Mair
Investment Manager
F&C Investment Business Limited
F&C PRIVATE EQUITY TRUST PLC
Statement of Comprehensive Income for the
three months ended 31 March 2017 (unaudited)
Revenue Capital Total
GBP'000 GBP'000 GBP'000
----------------------------------------- --------- --------- ---------
Income
Gains on investments held at fair
value - 2,556 2,556
Exchange losses - (84) (84)
Investment income 154 - 154
Other income 11 - 11
----------------------------------------- --------- --------- ---------
Total income 165 2,472 2,637
----------------------------------------- --------- --------- ---------
Expenditure
Investment management fee - basic
fee (158) (475) (633)
Investment management fee - performance
fee - (1,390) (1,390)
Other expenses (191) - (191)
----------------------------------------- --------- --------- ---------
Total expenditure (349) (1,865) (2,214)
----------------------------------------- --------- --------- ---------
(Loss)/profit before finance costs
and taxation (184) 607 423
Finance costs (104) (312) (416)
----------------------------------------- --------- --------- ---------
(Loss)/profit before taxation (288) 295 7
Taxation - - -
(Loss)/profit for period/total
comprehensive income (288) 295 7
Return per Ordinary Share - Basic (0.39)p 0.40p 0.01p
Return per Ordinary Share - Fully
diluted (0.39)p 0.40p 0.01p
F&C PRIVATE EQUITY TRUST PLC
Statement of Comprehensive Income for the
three months ended 31 March 2016 (unaudited)
Revenue Capital Total
GBP'000 GBP'000 GBP'000
----------------------------------------- --------- --------- ---------
Income
Gains on investments held at fair
value - 8,933 8,933
Exchange losses - (1,749) (1,749)
Investment income 138 - 138
Other income 17 - 17
----------------------------------------- --------- --------- ---------
Total income 155 7,184 7,339
----------------------------------------- --------- --------- ---------
Expenditure
Investment management fee - basic
fee (140) (419) (559)
Investment management fee - performance
fee - (1,030) (1,030)
Other expenses (170) - (170)
----------------------------------------- --------- --------- ---------
Total expenditure (310) (1,449) (1,759)
----------------------------------------- --------- --------- ---------
(Loss)/profit before finance costs
and taxation (155) 5,735 5,580
Finance costs (104) (313) (417)
----------------------------------------- --------- --------- ---------
(Loss)/profit before taxation (259) 5,422 5,163
Taxation - - -
(Loss)/profit for period/total
comprehensive income (259) 5,422 5,163
Return per Ordinary Share - Basic (0.36)p 7.52p 7.16p
Return per Ordinary Share - Fully
diluted (0.35)p 7.33p 6.98p
F&C PRIVATE EQUITY TRUST PLC
Statement of Comprehensive Income for the
year ended 31 December 2016 (audited)
Revenue Capital Total
GBP'000 GBP'000 GBP'000
-------------------------------------------- --------- --------- ---------
Income
Gains on investments held at fair
value - 58,538 58,538
Exchange losses - (3,584) (3,584)
Investment income 1,386 - 1,386
Other income 54 - 54
-------------------------------------------- --------- --------- ---------
Total income 1,440 54,954 56,394
-------------------------------------------- --------- --------- ---------
Expenditure
Investment management fee - basic
fee (582) (1,745) (2,327)
Investment management fee - performance
fee - (2,024) (2,024)
Other expenses (739) - (739)
-------------------------------------------- --------- --------- ---------
Total expenditure (1,321) (3,769) (5,090)
-------------------------------------------- --------- --------- ---------
Profit before finance costs and
taxation 119 51,185 51,304
Finance costs (419) (1,257) (1,676)
-------------------------------------------- --------- --------- ---------
(Loss)/profit before taxation (300) 49,928 49,628
Taxation - - -
(Loss)/profit for year/total comprehensive
income (300) 49,928 49,628
Return per Ordinary Share - Basic (0.41)p 68.16p 67.75p
Return per Ordinary Share - Fully
diluted (0.41)p 67.53p 67.12p
F&C PRIVATE EQUITY TRUST PLC
Balance Sheet
As at As at As at 31
31 March 31 March December
2017 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
------------------------------ ------------ ------------ ----------
Non-current assets
Investments at fair value
through profit or loss 232,551 229,321 239,049
------------------------------ ------------ ------------ ----------
Current assets
Other receivables 34 10 26
Cash and cash equivalents 57,213 24,182 48,575
------------------------------ ------------ ------------ ----------
57,247 24,192 48,601
Current liabilities
Other payables (5,092) (7,930) (3,057)
Net current assets 52,155 16,262 45,544
------------------------------ ------------ ------------ ----------
Total assets less current
liabilities 284,706 245,583 284,593
Non-current liabilities
Interest-bearing bank
loan (25,176) (23,086) (25,070)
Net assets 259,530 222,497 259,523
------------------------------ ------------ ------------ ----------
Equity
Called-up ordinary share
capital 739 729 739
Share premium account 2,527 - 2,527
Special distributable
capital reserve 15,040 16,240 15,040
Special distributable
revenue reserve 31,403 31,403 31,403
Capital redemption reserve 1,335 1,335 1,335
Capital reserve 203,974 163,424 203,679 Revenue reserve 4,512 9,366 4,800 Shareholders' funds 259,530 222,497 259,523 ------------------------------ ------------ ------------ ---------- Net asset value per Ordinary Share - Basic 350.99p 305.15p 350.98p Net asset value per Ordinary Share - Fully diluted 350.99p 302.72p 350.98p ------------------------------ ------------ ------------ ----------
F&C PRIVATE EQUITY TRUST PLC
Reconciliation of Movements in Shareholders' Funds
Three months Three months Year ended
ended 31 ended 31 31 December
March 2017 March 2016 2016
(unaudited) (unaudited) (audited)
GBP'000 GBP'000 GBP'000
----------------------------- ------------- ------------- -------------
Opening shareholders'
funds 259,523 216,125 216,125
Issue of Ordinary Shares - 1,209 2,546
Profit for the period/total
comprehensive income 7 5,163 49,628
Dividends paid - - (8,776)
Closing shareholders'
funds 259,530 222,497 259,523
----------------------------- ------------- ------------- -------------
Notes (unaudited)
1. The unaudited quarterly results have been prepared on the basis of the accounting policies set out in the statutory accounts of the Company for the year ended 31 December 2016.
2. Investment management fee:
Three months Three months Year ended 31
ended 31 March ended 31 March December 2016
2017 2016
Revenue Capital Total Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
Investment
management
fee - basic
fee 158 475 633 140 419 559 582 1,745 2,327
Investment
management
fee - performance
fee - 1,390 1,390 - 1,030 1,030 - 2,024 2,024
------------------- --------- --------- --------- --------- --------- --------- --------- --------- ---------
158 1,865 2,023 140 1,449 1,589 582 3,769 4,351
3. Finance costs:
Three months Three months Year ended 31
ended 31 March ended 31 March December 2016
2017 2016
Revenue Capital Total Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------ --------- --------- --------- --------- --------- --------- --------- --------- ---------
Interest payable
on bank loans 104 312 416 104 313 417 419 1,257 1,676
4. The basic return per Ordinary Share is based on a net profit on ordinary activities after taxation of GBP7,000 (31 March 2016 -GBP5,163,000; 31 December 2016 -GBP49,628,000) and on 73,941,429 (31 March 2016 - 72,064,084; 31 December 2016 - 73,249,836) shares, being the weighted average number of Ordinary Shares in issue during the period.
The fully diluted return per Ordinary Share is based on a net profit on ordinary activities after taxation of GBP7,000 (31 March 2016 -GBP5,163,000; 31 December 2016 -GBP49,628,000) and on 73,941,429 (31 March 2016 - 73,941,429; 31 December 2016 - 73,941,429) shares, being the weighted average number of Ordinary Shares in issue during the period after conversion of the Ordinary Share warrants.
5. The basic net asset value per Ordinary Share is based on net assets at the period end of GBP259,530,000 (31 March 2016 - GBP222,497,000; 31 December 2016 - GBP259,523,000) and on 73,941,429 (31 March 2016 - 72,912,872; 31 December 2016 - 73,941,429) shares, being the number of Ordinary Shares in issue at the period end.
The fully diluted net asset value per Ordinary Share is based on net assets at the period end of GBP259,530,000 (31 March 2016 - GBP223,834,000; 31 December 2016 - GBP259,523,000) and on 73,941,429 (31 March 2016 - 73,941,429; 31 December 2016 - 73,941,429) shares, being the number of Ordinary Shares in issue at the period end after conversion of the Ordinary Share warrants. During the year ended 31 December 2016, the Company issued 1,959,156 Ordinary Shares of 1p each in capital of the Company, following the exercise of subscription rights by holders of a corresponding number of management warrants previously issued by the Company in the capital of the Company. As at 31 March 2017, no warrants remain in issue (31 March 2016 - 1,959,156; 31 December 2016 - nil).
6. The financial information for the three months ended 31 March 2017, which has not been audited or reviewed by the Company's auditor, comprises non-statutory accounts within the meaning of Section 434 of the Companies Act 2006. Statutory accounts for the year ended 31 December 2016, on which the auditor issued an unqualified report, will be lodged with the Registrar of Companies. The quarterly report is available on the Company's website www.fcpet.co.uk.
Legal Entity Identifier: 2138009FW98WZFCGRN66
For more information, please contact:
Hamish Mair (Investment Manager) 0131 718 1184 Scott McEllen (Company Secretary) 0131 718 1137 hamish.mair@bmogam.com / scott.mcellen@bmogam.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
QRFEANSSALFXEEF
(END) Dow Jones Newswires
May 25, 2017 05:49 ET (09:49 GMT)
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