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LONDON (Alliance News) - Private equity investor 3i Group PLC on Thursday said it has continued to deliver against its strategy of streamlining its portfolio, delivering growth in its net asset value per share in the year to the end of March in addition to a higher dividend payout and higher total return.
The FTSE 100-listed group has been thinning down its investment portfolio in the past couple of years. Since kicking off its restructuring plan in 2012, its total number of investments has fallen to 65 from 124, with plans to further reduce this to fewer than 40 in the future.
3i said it intends to continue investing EUR500 million to EUR750 million in four to seven investments per year, but intends to remain a significant net divestor over the next five years.
"2016 was another strong year for 3i and built on the success of our recent restructuring. The group's performance has been resilient in the face of challenging macro-economic conditions and volatile markets," said Chief Executive Simon Borrows.
3i said it anticipates markets will remain challenging but its confident it will deliver another resilient performance in the current financial year.
Shares in the company were up 3.2% to 503.00 pence, one of the best performers in the FTSE 100.
3i said its total return for the year to the end of March was GBP824.0 million, up from GBP659.0 million a year earlier, while its net asset value per share was 463.0 pence at the end of the financial year, compared to 396.0p at the same point a year earlier. Its total return to shareholders for the year was 21.7%, compared to 19.9% the year before.
The performance of the portfolio was driven by investments in Action, the European non-food discount chain, ferry operator Scand-Lines and European discount gym operator Basic-Fit, which this week announced plans to float.
3i said it brought in proceeds of GBP743.0 million from private equity realisations over the course of the year. The group sold 11 older or smaller assets from its portfolio, including bringing in GBP188.0 million from the sale of Element Materials Technology, a US testing company.
The group also invested GBP365.0 million in three new portfolio companies. The investments included UK luxury travel operator Audley Travel, plastic packaging systems supplier Weener Plastic and power supply systems firm Euro-Diesel.
It also noted a 13% total shareholder return from 3i Infrastructure PLC, in which 3i holds a 34% investment and which also is listed in London.
3i said it will pay a final dividend of 16.0p for the year, taking the total payout to 22.0p, up 10% from 20.0p a year earlier.
"These strong FY2016 results demonstrate 3i's continued momentum in the face of challenging macro-economic conditions. We enter [financial year] 2017 firmly focused on delivering our clear and consistent strategy and generating good returns and distributions for our shareholders," said Borrows.
By Sam Unsted; samunsted@alliancenews.com; @SamUAtAlliance
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