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(Alliance News) - 3i Group PLC on Thursday reported a decline in net asset value per share, reflecting the expected blow to its portfolio company projections in the wake of the Covid-19 pandemic.
Shares in 3i were up 2.8% at 771.00 pence in London in early morning trading.
The private equity and infrastructure investor reported a diluted NAV per share of 804 pence as at March 31, the end of its financial year. This represents a 1.3% drop from year earlier's 815p.
"We have assessed the effect of the pandemic on full-year projections for each of our portfolio companies, and the current dislocation of capital markets on multiples and discount rates," 3i explained.
As a result, total return for the year was GP253 million, down from GBP1.25 billion the year before, while return on opening shareholders' funds was 3%, down from 18%.
"The impact of the crisis reflects our diverse portfolio, the defensive nature of many of the individual companies, and our consistent adoption over many years of long-term, through the cycle, multiples and discount rates," the company said.
Its portfolio value increased 7.3% to GBP8.10 billion on March 31 from GP7.55 billion the prior year, gross debt was flat at GBP575 million, and net cash fell 45% to GBP270 million from GBP495 million. Liquidity was at GP1.25 billion, having been GBP1.42 billion the year before.
3i maintained its dividend per share at 35 pence, with a 17.5p per share final dividend scheduled to be paid in July subject to shareholder approval.
Chief Executive Simon Borrows said: "We delivered a solid return for FY2020 despite the severe challenge posed by the Covid-19 pandemic and its impact on portfolio performance in the last month of the year.
He added: "We enter our new financial year with a carefully assembled portfolio of private equity and infrastructure companies and an experienced team that has proved adept at managing these investments against a deteriorating macro-economic backdrop. We have been cautious investors for some years and have maintained a strong balance sheet since our restructuring in 2012. This conservative approach will help us to navigate the challenging months ahead minimising significant interruptions so that we can continue to generate attractive returns for our investors through the cycle. "
By Anna Farley; annafarley@alliancenews.com
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