Apax Global Alpha Regulatory News (APAX)

·

AGA achieved a Total NAV Return1 of 2.4% (3.6% constant currency) in the six months ended 30 June 2023. Adjusted NAV2 was largely unchanged at €1.3bn (31 Dec 2022: €1.3bn) or €2.64/£2.27 per share.

·

The main drivers of Total NAV Return were value creation across the Private Equity portfolio as well as strong returns from the Debt portfolio.

·

In Private Equity, continued momentum saw portfolio companies achieve average LTM EBITDA growth of 14.1%3 despite some slowdown in earnings growth in Q2 2023.

·

AGA received €35m in distributions from the Apax Funds, primarily from three full exits achieved at an average uplift of 24%4. This brings total distributions received from the Apax Funds in the last 5 years to €998m compared to calls of €651m in the same period.

·

AGA deployed €11.4m5 across three new investments in the first six months of 2023, including the first standalone investment in the Apax Global Impact Fund to which AGA has committed $60m. The pipeline for new investments remains healthy with Apax XI, the latest global buyout fund, signing its first two investments in May and July.

·

The Debt portfolio, which primarily consists of first and second lien loans to complement the Private Equity portfolio, achieved a Total Return1 of 5.3% in the first six months of 2023. The portfolio had a yield to maturity of 13.3% and, with 99% of investments being floating rate loans, the income yield was 11.4% at 30 June 2023.

·

Dividend of 5.70p per share declared for the half year 2023, in line with AGA's stated dividend policy of distributing 5% of NAV per annum.

·

AGA was 93% invested as at 30 June 2023. The Company's unfunded commitments to the Apax Funds (together with recallable distributions) reduced by €20m in the six months period to €985m at 30 June 2023 (31 Dec 22: €1.0bn).

·

At 30 June 2023, AGA's invested portfolio was split 71% in Private Equity and 28% in Debt investments, with the remaining 1% invested across three Equity positions.

·

On 5 September 2023, AGA entered into a new multi-currency revolving credit facility of €250m with SMBC Bank International plc and JPMorgan Chase, N.A., London Branch, replacing the facility with Credit Suisse AG, London Branch. The new facility has an initial term of 2.5 years, and the margin will be 300-335bps (over SOFR or EURIBOR) p.a.

H1 2023 (EUR)

H1 2023 (GBP)

FY 2022 (EUR)

FY 2022 (GBP)

Adjusted NAV2

1,299m

1,116m

1,299m

1,150m

Adjusted NAV2 per share

2.64

2.27

2.65

2.34

NAV2 per share

2.65

2.28

2.65

2.34

% of NAV

H1 2023

H1 2023 constant currency

Total NAV Return1

2.4%

3.6%

Total Return1 - Private Equity

66%

1.9%

3.2%

Total Return1 - Debt Investments

26%

5.3%

6.9%

Total Return1 - Derived Equity

1%

2.9%

3.8%

Cash & Others

7%

·

AGA offers access to a portfolio of hidden gems, mostly private companies that shareholders can't buy elsewhere. These companies operate globally across the core Apax sectors of Tech & Digital, Services, Healthcare, and Internet/Consumer.

·

At 30 June 2023, the invested portfolio consisted of 39% invested in Tech & Digital, 28% in Services, 17% in Healthcare, and 16% in Internet/Consumer.

·

In Private Equity, earnings growth was a key driver of performance with average LTM EBITDA growth to 30 June 2023 of 14.1%3 across portfolio companies. Valuation multiples reduced to 16.3x3 compared to 17.2x at 31 December 2022, reflecting multiple compression from Paycor and Thoughtworks, two publicly listed holdings that were IPO'd in 2021, as well as a change to the comparables set of certain companies as a result of the impact of M&A.

·

Leverage across the Apax Funds' portfolio reduced slightly to 4.4x3 at 30 June 2023 (31 December 2022: 4.8%). The Funds' portfolio is well-positioned to weather the current interest rate environment and 83%6 of portfolio companies have debt maturities extending beyond 2027 and about three quarters of debt outstanding at a fixed rate.

·

AGA's Debt portfolio continued to perform strongly and delivered a Total Return1 of 5.3% in H1 2023. This portfolio has achieved a 46.8% cumulative constant currency Total Return over the past five years, outperforming the S&P/LSTA leveraged loan index7 which delivered 22.4% for the same five-year period.

·

The Derived Debt portfolio absorbs cash not invested in Private Equity, enhances the robustness of AGA's balance sheet, provides a steady flow of income to support dividends, and additional returns.

·

Derived Equity now makes up a very small part of the portfolio and at 30 of June 2023, the portfolio held three positions valued at €13.8m. This portfolio delivered a Total Return1 of 2.9% in H1 2023.

Adjusted NAV movements (€m)

Private Equity

Derived Investments

Cash

Treasury Shares

Facility drawn

Other8

H1 2023

Total

Adjusted NAV at 31.12.22

871.0

364.2

68.0

-

-

(3.8)

1,299.4

+ Investments

6.9

5.9

(16.8)

-

-

4.0

-

- Distributions/ divestments

(35.0)

(19.1)

54.4

-

-

(0.3)

-

+ Interest and dividend income

-

-

14.8

-

-

4.1

18.9

+/- Gains/(losses)

26.5

10.1

-

-

-

-

36.6

+/- FX gains/(losses)9

(10.5)

(5.6)

0.3

-

-

-

(15.8)

+/- Costs and other movements

-

-

(1.8)

-

-

(3.0)

(4.8)

 - Dividends paid

-

-

(32.5)

-

-

-

(32.5)

+/- Performance fee reserve10

-

(3.1)

-

-

-

-

(3.1)

+/- Shares purchased

-

-

-

-

-

-

-

+/- Revolving credit facility

drawn/repaid

-

-

-

-

-

-

-

Adjusted NAV at 30.06.23

858.9

352.4

86.4

-

-

1.0

1,298.7

Private Equity - operational metrics

30 June 23

31 December 22

Portfolio year-over-year LTM revenue growth3

16.0%

21.5%

Portfolio year-over-year LTM EBITDA growth3

14.1%

18.5%

Enterprise Value / EBITDA valuation multiple3

16.3x

17.2x

Net debt / EBITDA multiple3

4.4x

4.8x

Derived Investments - operational metrics

30 June 23

31 December 22

Debt average yield to maturity

13.3%

12.1%

Debt average years to maturity

4.6

5.1

Debt average income yield

11.4%

9.9%

Invested Portfolio analysis11

€m

€m

%

%

- AEVI

2.2

0%

- AEVII

23.5

2%

- AVIII

62.8

6%

- AIX

309.5

25%

- AX

394.0

32%

- AXI

(8.2)

0%

- AMI

26.1

2%

- AMI II

(1.1)

0%

- ADF

51.4

4%

- ADF II

0.5

0%

- AGI

(1.8)

0%

Private Equity

858.9

71%

- Derived Debt

341.7

28%

- Derived Equity

13.8

1%

Derived Investments

355.5

29%

Total

1,214.7

100%

1.

Note that references in this announcement to Apax Global Alpha Limited have been abbreviated to "AGA" or "the Company". References to Apax Partners LLP have been abbreviated to "Apax" or "the Investment Adviser"

2.

Please be advised that this announcement may contain inside information as stipulated under the Market Abuse Regulations (EU) NO. 596/2014 ("MAR")

3.

This announcement is not for release, publication or distribution, directly or indirectly, in whole or in part, into or within the United States or to "US persons" (as defined in Regulation S under the United States Securities Act of 1933, as amended (the "Securities Act")) or into or within Australia, Canada, South Africa or Japan. Recipients of this announcement in jurisdictions outside the UK should inform themselves about and observe any applicable legal requirements in their jurisdictions. In particular, the distribution of the announcement may be restricted by law in certain jurisdictions

4.

The information presented herein is not an offer for sale within the United States of any equity shares or other securities of Apax Global Alpha Limited ("AGA"). AGA has not been and will not be registered under the US Investment Company Act of 1940, as amended (the "Investment Company Act"). In addition, AGA's shares (the "Shares") have not been and will not be registered under the Securities Act or any other applicable law of the United States. Consequently, the Shares may not be offered or sold or otherwise transferred within the United States, or to, or for the account or benefit of, US Persons, except pursuant to an exemption from the registration requirements of the Securities Act and under circumstances which will not require AGA to register under the Investment Company Act. No public offering of the Shares is being made in the United States

5.

This announcement may include forward-looking statements. The words "expect", "anticipate", "intends", "plan", "estimate", "aim", "forecast", "project" and similar expressions (or their negative) identify certain of these forward-looking statements. These forward-looking statements are statements regarding AGA's intentions, beliefs or current expectations concerning, among other things, AGA's results of operations, financial condition, liquidity, prospects, growth and strategies. The forward-looking statements in this presentation are based on numerous assumptions regarding AGA's present and future business strategies and the environment in which AGA will operate in the future. Forward-looking statements involve inherent known and unknown risks, uncertainties and contingencies because they relate to events and depend on circumstances that may or may not occur in the future and may cause the actual results, performance or achievements of AGA to be materially different from those expressed or implied by such forward looking statements. Many of these risks and uncertainties relate to factors that are beyond AGA's ability to control or estimate precisely, such as future market conditions, currency fluctuations, the behaviour of other market participants, the actions of regulators and other factors such as AGA's ability to continue to obtain financing to meet its liquidity needs, changes in the political, social and regulatory framework in which AGA operates or in economic or technological trends or conditions. Past performance should not be taken as an indication or guarantee of future results, and no representation or warranty, express or implied, is made regarding future performance. AGA expressly disclaims any obligation or undertaking to release any updates or revisions to these forward-looking statements to reflect any change in AGA's expectations with regard thereto or any change in events, conditions or circumstances on which any statement is based after the date of this announcement, or to update or to keep current any other information contained in this announcement. Accordingly, undue reliance should not be placed on the forward-looking statements, which speak only as of the date of this announcement.