NBPE Announces Audited 2022 Results and 31 March 2023 Est. NAV

    NBPE Announces Audited 2022 Results and 31 March 2023 Est. NAV 

THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO AUSTRALIA, CANADA, ITALY, DENMARK, JAPAN, THE UNITED STATES, OR TO ANY NATIONAL OF SUCH JURISDICTIONS

25 April 2023

NB Private Equity Partners (NBPE), the $1.3bn FTSE 250 listed private equity investment company managed by Neuberger Berman, today releases its 2022 Annual Financial Report and 31 March 2023 Monthly NAV Update.

Audited Annual Results Highlights (31 December 2022)

• NAV per share of $28.38 (£23.59)
• (7.5%) NAV TR in the 12 months to 31 December 2022, with decline driven by changes in quoted holdings and FX
• Private portfolio +4.4% in 2022 on a constant currency basis
• Strong portfolio company operating performance of 14% LTM revenue and 12% LTM EBITDA growth, respectively, during 20221
• $143 million of announced realisations during 2022
• Well positioned to take advantage of investment opportunities - $308 million of cash and undrawn credit line available
• $0.94 per share of dividends paid during 2022

As of 31 December 2022	2022	3 years	5 years	10 years
NAV TR (USD)*Annualised	(7.5%)(7.5%)	62.7%17.6%	89.4%13.6%	231.2%12.7%
MSCI World TR (USD)*Annualised	(17.7%)(17.7%)	17.3%5.4%	38.2%6.7%	146.4%9.4%
Share price TR (GBP)*Annualised	(9.7%)(9.7%)	49.8%14.4%	87.3%13.4%	400.8%17.5%
FTSE All-Share TR (GBP)*Annualised	0.3%0.3%	7.1%2.3%	15.5%2.9%	88.2%6.5%

*Reflects cumulative returns over the time periods shown and are not annualised.

Peter Von Lehe, Managing Director and Head of Investment Solutions & Strategy at Neuberger Berman commented:

“Against challenging markets and macro-economic headwinds, we believe NBPE’s performance has been resilient, both from a net asset value perspective and with respect to the overall operating performance of  our underlying portfolio companies. Our private investments, which represent almost 90% of the portfolio, appreciated in value by 4.4% on a constant currency basis – with strong operating performance more than outweighing the reduction in valuation multiples, which declined by over two turns. However, this resilient performance was outweighed by a decline in value of our publicly listed holdings and foreign exchange headwinds, which resulted in an aggregate NAV decline of 7.5% on a total return basis in 2022.”

Paul Daggett, Managing Director of Neuberger Berman, continued:

“Looking across our private company portfolio, returns continued to be driven by revenue and EBITDA growth and the portfolio, as a whole, has continued to perform well, reporting weighted average LTM revenue and LTM EBITDA growth of 14% and 12%, respectively, during the year.  Given the macro-economic headwinds, unsurprisingly some companies experienced challenges mostly due to issues caused by supply chain pressures, inflation or labour costs. However, this was offset by resilient performance in other areas of the portfolio, which we believe speaks to the advantages of maintaining diversification and investing across our key themes.

As demonstrated by our private company performance, private equity’s ability to respond quickly to market forces, whether those be opportunities or threats, should continue to create the opportunity for value creation, and we believe NBPE’s portfolio is well positioned to generate growth over the long-term.”

The Company’s 2022 Annual Report and a video from Neuberger Berman to accompany the results are available to view at:  https://www.nbprivateequitypartners.com/.

Portfolio Update to 31 March 2023

NAV TR increase of 1% YTD 2023

• 31 March 2022 NAV per share of $28.20 (£22.81), an increase of 0.4% in March
• Public investments up ~$19 million YTD 2023, or approximately 11%

Realisations from the portfolio in 2023

• $27 million of announced realisations in the first three months of 20232
  • Realisation from the sale of one public stock position; partial sale of one portfolio company, and continued realisations from the Income portfolio
• A further $16 million of proceeds from previously announced realisations expected in the coming months

Robust liquidity – well positioned to take advantage of opportunities

• $308 million of available liquidity ($8 million cash, $300 million of undrawn credit line)

Portfolio Valuation

The fair value of NBPE’s portfolio as of 31 March 2023 was based on the following information:

• 16% of the portfolio was valued as of 31 March 2023

• • 13% in public securities
  • 3% in private direct investments

• 84% of the portfolio was valued as of 31 December 2022

• • 83% in private direct investments
  • 1% in private fund investments

Share Buyback Agreement

The Directors believe the current discount materially undervalues NBPE’s portfolio, balance sheet strength and prospects. The Board believes the share price represents a very attractive entry point for investors to gain exposure to high quality private companies and NBPE continues to expand its investor relations initiatives to increase its profile amongst existing and new investors. Alongside this, in October 2022, NBPE entered into an agreement with Jefferies, which allows them, in their sole discretion, to repurchase NBPE shares based on certain criteria. To date, no shares have been repurchased and the Company will be renewing its agreement with Jefferies, including updating the relevant repurchase criteria.

Investor Call

NBPE plans to hold an investor update call on Tuesday 25 April 2023 in order to discuss the investment portfolio and provide an update on performance.

The webinar will take place at 12:00 BST / 13:00 CEST / 7:00 AM EDT.  Registration for the event and the call can be accessed here:

https://www.lsegissuerservices.com/spark/NBPrivateEquityPartnersLtd/events/b6c9a108-2f3d-4518-968e-5da57f5ccbe6

For further information, please contact:

NBPE Investor Relations          [phone]

Kaso Legg Communications    [phone]

Charles Gorman                        [e-mail] DampierCharlotte Francis

Supplementary Information (as at 31 March 2023)

Company Name	Vintage	Lead Sponsor	Sector	Fair Value ($m)	% of FV
Action	2020	3i	Consumer	64.0	4.6%
Advisor Group	2019	Reverence Capital	Financial Services	54.2	3.9%
Constellation Automotive	2019	TDR Capital	Business Services	54.2	3.9%
AutoStore (OB.AUTO)	2019	THL	Industrials	52.9	3.8%
USI	2017	KKR	Financial Services	50.0	3.6%
Agiliti (NYSE: AGTI)	2019	THL	Healthcare	39.9	2.9%
Material Handling Systems	2017	THL	Industrials	39.7	2.8%
Cotiviti	2018	Veritas Capital	Healthcare	35.5	2.5%
GFL (NYSE: GFL)	2019	BC Partners	Business Services	33.2	2.4%
Business Services Company*	2017	Not Disclosed	Business Services	32.9	2.4%
Kroll	2020	Further Global / Stone Point	Financial Services	32.1	2.3%
BeyondTrust	2018	Francisco Partners	Technology / IT	29.4	2.1%
True Potential	2022	Cinven	Financial Services	29.2	2.1%
Marquee Brands	2014	Neuberger Berman	Consumer	28.5	2.0%
Solenis	2021	Platinum Equity	Industrials	27.0	1.9%
Monroe Engineering	2021	AEA Investors	Industrials	26.6	1.9%
Stubhub	2020	Neuberger Berman	Consumer	26.4	1.9%
Engineering	2020	NB Renaissance / Bain Capital	Technology / IT	25.5	1.8%
Addison Group	2021	Trilantic Capital Partners	Business Services	23.9	1.7%
Branded Toy Company*	2017	Not Disclosed	Consumer	23.8	1.7%
Branded Cities Network	2017	Shamrock Capital	Communications / Media	23.6	1.7%
Staples	2017	Sycamore Partners	Business Services	22.8	1.6%
Excelitas	2017	AEA Investors	Industrials	22.1	1.6%
Auctane	2021	Thoma Bravo	Technology / IT	21.9	1.6%
Bylight	2017	Sagewind Partners	Technology / IT	21.9	1.6%
Petsmart / Chewy (NYSE: CHWY)	2015	BC Partners	Consumer	20.8	1.5%
Accedian	2017	Bridge Growth Partners	Technology / IT	20.6	1.5%
FV Hospital	2017	Quadria Capital	Healthcare	20.4	1.5%
Renaissance Learning	2018	Francisco Partners	Technology / IT	19.7	1.4%
Solace Systems	2016	Bridge Growth Partners	Technology / IT	17.2	1.2%
Total Top 30 Investments				$923.1	66.1%

*Undisclosed company due to confidentiality provisions.

Geography	% of Portfolio
North America	73%
Europe	23%
Asia / Rest of World	4%
Total Portfolio	100%
Industry	% of Portfolio
Tech, Media & Telecom	21%
Consumer / E-commerce	19%
Industrials / Industrial Technology	16%
Business Services	13%
Financial Services	15%
Healthcare	10%
Other	5%
Energy	1%
Total Portfolio	100%
Vintage Year	% of Portfolio
2014 & Earlier	5%
2015	2%
2016	8%
2017	24%
2018	18%
2019	19%
2020	11%
2021	11%
2022	2%
Total Portfolio	100%

About NB Private Equity Partners LimitedNBPE invests in direct private equity investments alongside market leading private equity firms globally. NB Alternatives Advisers LLC (the “Investment Manager”), an indirect wholly owned subsidiary of Neuberger Berman Group LLC, is responsible for sourcing, execution and management of NBPE. The vast majority of direct investments are made with no management fee / no carried interest payable to third-party GPs, offering greater fee efficiency than other listed private equity companies. NBPE seeks capital appreciation through growth in net asset value over time while paying a bi-annual dividend.

LEI number: 213800UJH93NH8IOFQ77

About Neuberger BermanNeuberger Berman, founded in 1939, is a private, independent, employee-owned investment manager. The firm manages a range of strategies—including equity, fixed income, quantitative and multi-asset class, private equity, real estate and hedge funds—on behalf of institutions, advisors and individual investors globally. With offices in 26 countries, Neuberger Berman’s diverse team has over 2,700 professionals. For nine consecutive years, the company has been named first or second in Pensions & Investments Best Places to Work in Money Management survey (among those with 1,000 employees or more). Neuberger Berman is a PRI Leader, a designation, since last assessed, that was awarded to fewer than 1% of investment firms for excellence in Environmental, Social and Governance (ESG) practices. In the 2021 PRI Assessment, the firm obtained the highest possible scoring for its overarching approach to ESG investment and stewardship, and integration across asset classes. The firm manages $436 billion in client assets as of March 31, 2023. For more information, please visit our website at www.nb.com.

1. Past performance is no guarantee of future results. Fair value as of 31 December 2022 and the data is subject to the following adjustments: 1) Excludes public companies. 2) Analysis based on 67 private companies. 3) The private companies included in the data represent approximately 81% of the total direct equity portfolio. 4) Six companies were excluded from the revenue and EBITDA growth metrics on the basis of the following: a) one company with a value of $24 million used an industry-specific metric as a measurement of cash flow b) one company experienced extraordinary positive growth rates c) two companies (less than 1% of direct equity fair value) had anomalous percentage changes which the manager believed to be outliers d) two investments held less than one year. If all exclusions had been included (except for investments held less than one year), LTM Revenue and LTM EBITDA growth would be higher. Portfolio company operating metrics are based on the most recently available (unaudited) financial information for each company and based on as reported by the lead private equity sponsor to the Manager as of 31 March 2023. Where necessary, estimates were used, which include pro forma adjusted EBITDA and other EBITDA adjustments, pro forma revenue adjustments, run-rate adjustments for acquisitions, and annualised quarterly operating metrics. LTM periods as of 31/12/22 and 30/9/22 and 31/12/21 and 30/9/21. LTM revenue and LTM EBITDA growth rates are weighted by fair value.

2$37 million received during 2023, of which $11 million was attributable to an announced sale in 2022, but received in 2023.

This press release appears as a matter of record only and does not constitute an offer to sell or a solicitation of an offer to purchase any security. NBPE is established as a closed-end investment company domiciled in Guernsey. NBPE has received the necessary consent of the Guernsey Financial Services Commission. The value of investments may fluctuate. Results achieved in the past are no guarantee of future results. This document is not intended to constitute legal, tax or accounting advice or investment recommendations. Prospective investors are advised to seek expert legal, financial, tax and other professional advice before making any investment decision. Statements contained in this document that are not historical facts are based on current expectations, estimates, projections, opinions and beliefs of NBPE's investment manager. Such statements involve known and unknown risks, uncertainties and other factors, and undue reliance should not be placed thereon. Additionally, this document contains "forward-looking statements." Actual events or results or the actual performance of NBPE may differ materially from those reflected or contemplated in such targets or forward-looking statements.

 

Attachments

• March 2023 NBPE Factsheet
• NBPE Investor Presentation - April 2023vF
• 2022 NBPE Annual Report - Final