Forward Partners Group PLC Trading Update (9780W)

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RNS Number : 9780W

Forward Partners Group PLC

24 August 2022

Forward Partners Group plc

("Forward Partners" or "the Group")

TRADING UPDATE

Forward Partners Group plc (LSE: FWD), the London-based investment firm specialising in supporting high-growth, early-stage technology businesses, provides an update on trading for the six-month period to 30 June 2022 including a decision to affect a managed wind down of the Group's Forward Advances subsidiary.

Forward Ventures

The Group anticipates Ventures Portfolio Value at the half-year to 30 June 2022 to be no less than GBP92.0m inclusive of GBP6.3m in new investments. As previously indicated at the 2021 final year results, this represents a decline of 26.4% exclusive of these new investments.

NAV per share is expected to be not less than 83.4 pence per share of which cash per share is expected to be 16.8 pence.

Portfolio highlights

As previously noted, valuation headwinds from the decline in share prices at high growth tech stocks are the primary driver of the drop in the Ventures Portfolio Value. The performance of the underlying portfolio remains strong:

-- Average forecast revenue growth of the Top 15* portfolio investments by Fair Value of 40-60% for the full year.**

-- Over 80% of the Top 15* portfolio investments are anticipated to be on the path to break even without the need for further fundraising or have sufficient resources to negate the need for fundraising for 18 months or more.**

-- GBP6.3m investments made during the period which includes 12 follow-on investments totalling GBP4.9m and new investments in two high growth, early-stage technology companies - Baselime and Sonrai, totalling GBP1.4m.

-- The Top 15* portfolio investments account for 69.0% of Venture Portfolio Value, with the most valuable company accounting for 9.8%. Investment in the Top 15 to date totals GBP25.8m.*** 61.7% of the portfolio comprise B2B companies.

Forward Advances

The Group has decided to conduct a managed wind down of its subsidiary Forward Partners Venture Advance Limited ("Advances"). The start-up venture was established in 2020 to meet the demand of the fast-growing alternative funding market, separate to venture capital. Since then, it has originated GBP14.9m, aiding consumer-focused eCommerce companies to increase revenues through short term unsecured funding.

Forward Partners continually reviews its business against its primary objective to create long-term sustainable shareholder value and has judged that the current macroeconomic environment and the low margins necessary for Advances to compete in the alternative funding market have limited opportunities for future growth of the subsidiary. Consequently, the managed wind down of Advances' operations will commence from today. While no further funding will be originated or made, current Advances customers will be fully serviced for the duration of their contracts.

In the year to 31 December 2021, Advances generated revenues of GBP366k and recorded losses after tax of GBP1.1m, with total originations of GBP9.5m. Advances book value at 30 June is expected to be GBP1.9m. Repayments from outstanding Advances remain in line with forecasts, and costs this financial year, including wind down costs, are anticipated to be GBP2.8m.

The Group will use the capital conserved to support Ventures in investing into new technology businesses with strong fundamentals and existing portfolio companies that we know and trust. Our forecasts show that a managed wind down of Advances will reduce operating costs and, over time, strengthen the Group's balance sheet.

ENDS

NOTES

* Top 15 portfolio investments denotes the most valuable companies held in Forward's Venture portfolio by Fair Value at a point in time. Except where otherwise noted, in this release we refer to the Top 15 at 31 December 2021 to provide a meaningful basis for comparison. At that time, the Top 15 comprised Ably, Gravity Sketch, Makers, Spoke, Patch, Snaptrip, Cazoo, Robin AI, Apexx, Juno, KoruKids, Cherryz, Koyo Loans, Lexoo and Counting Up. The Top 15 is subject to change at the publication of the full interim results.

** Management estimates as of 12 August 2022. These are based on portfolio company forecasts and assume no further material deterioration in the economy or public technology stocks that the Company utilises in comparable valuations. Revenue growth average weighted by the Fair Value of portfolio companies at 31 December 2021.

*** Investment in Top 15 portfolio investments to 30 June 2022.

Enquiries

 
 FORWARD PARTNERS GROUP   Via Maitland/amo 
  PLC 
 Nic Brisbourne, Chief 
  Executive Officer 
 
 
 LIBERUM CAPITAL LIMITED 
 (Nominated Adviser and    Tel: [phone] 
  Broker) 
 Neil Patel 
 Lauren Kettle 
 Edward Phillips 
 Cara Murphy 
 
 
 Maitland/amo (Financial   [e-mail] 
  PR) 
 Sam Turvey, Alistair      Tel: [phone] 
  de Kare-Silver 
 

About Forward Partners

Founded in 2013, Forward Partners is an established and respected London-based venture capital firm, specialising in supporting high growth, early-stage technology businesses.

The Group brings together venture capital provider Forward Ventures with highly specialised growth support from Forward Studio. This model supports founders to build stronger businesses faster to provide better outcomes for companies and investors alike.

The Group makes equity investments in early-stage, high growth UK companies, and from inception to its admission to London's AIM market in July 2021 had made over 60 unique investments and built a portfolio with an Initial Portfolio NAV in excess of GBP100m. It holds an eight-year track record of making venture capital investments, and targets underlying NAV growth of 20% per annum on average over the cycle.

The management team brings together highly experienced venture capitalists, entrepreneurs, and expert consultants. Since 2015, Forward Partners has been backed by BlackRock, one of the largest institutional investors in the world. The Group receives over 4,000 start-up funding applications every year.

For more information, visit https://forwardpartners.com

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August 24, 2022 02:00 ET (06:00 GMT)