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7 Feb 2014 07:00
EMBARGOED UNTIL 07:00AM, FRIDAY 7 FEBRUARY 2014
ELECTRA PRIVATE EQUITY PLC
Interim Management Statement for the three month period to 31 December 2013
The information contained in this announcement is restricted and is not for release, publication or distribution, directly or indirectly, nor does it constitute an offer of securities for sale in the United States, Canada, Japan, Australia or New Zealand.
References in this announcement to Electra Private Equity PLC and its subsidiaries have been abbreviated to 'Electra' or the 'Company'. References to Electra Partners LLP and EQM Capital LLP (manager of Electra's money market investments) have been abbreviated to 'Electra Partners' or 'the Manager'.
Unaudited Financial Highlights for the three month period to 31 December 2013
· Diluted NAV per share of 2,781p (2,764p at 30 September 2013)
· Share price up 7% compared to an increase of 5% in the FTSE All-Share Index
· Share price up 24% over the year to 31 December 2013 against a 21% increase for theFTSE All-Share Index
· The top 10 and 20 investments accounted for 47% and 64% respectively of the investment portfolio
· £358 million of liquid resources (net of bank borrowings)
Portfolio Highlights for the three month period to 31 December 2013
· £15 million invested
· £89 million realised (inclusive of income)
Subsequent to 31 December 2013
· £85 million invested in Hotter Shoes ("Hotter")
· Committed to invest £83 million in Ogier Fiduciary Services ("OFS")
· £204 million of liquid resources (net of borrowings) at 3 February 2014, following the investment in Hotter and net of the commitment to invest in OFS
Dr Colette Bowe, Chairman of Electra Private Equity, said:
"Following record levels of both new investments and realisations in the year to 30 September 2013, the Board is delighted to see a continuation of this high level of investment activity in the opening months of the new financial year. Although new investment in the three month period to 31 December 2013 was at a relatively subdued level, Electra Partners has subsequently finalised two major new investments, in January and February 2014, which will see Electra invest £168 million."
Hugh Mumford, Managing Partner of Electra Partners, said:
"The new financial year has started well, with a continuation of the high level of investment activity seen in 2013. We have maintained our patient and disciplined approach to new investment while also continuing to see performance, in the form of cash returns, from some of the more recent investments in the portfolio."
For further information please contact:
For Dr Colette Bowe/Hugh Mumford:
Andrew Honnor or Matthieu Roussellier, Greenbrook Communications +44 (0)20 7952 2000
Andrew Kenny or Nick Board, Investor Relations, Electra Partners LLP +44 (0)20 7214 3902
1 Unaudited Net Asset Value
As is usual for the calculation of Electra's net asset value for the purposes of Interim Management Statements, the investment portfolio (apart from listed investments) has not been revalued at 31 December 2013 although it does reflect purchases and sales of investments, currency movements and bid values in respect of listed investments at that date. The impact of these changes resulted in an increase in the diluted net asset value of 1% since 30 September 2013.
31 Dec 2013 | 30 Sept 2013 | Movement | |
p | p | % | |
NAV per share (diluted) | 2,781 | 2,764 | 1 |
2 Share Price Performance
Electra's share price at 31 December 2013 was 2,380p, an increase of 7% over the three months to31 December 2013 compared to an increase of 5% for the FTSE All-Share Index. Over the year to31 December 2013, Electra's share price increased by 24% while the FTSE All-Share Index increasedby 21%.
3 Resources and Commitments
31 Dec 2013 | 30 Sept 2013 | |
£m | £m | |
Liquid resources | 515 | 452 |
Bank borrowings (facility committed until 2017) | (157) | (158) |
ZDP shares (repayable 2016) | (62) | (61) |
Convertible Bond (repayable 2017 if not previously converted) | (82) | (82) |
Net Cash | 214 | 151 |
At 31 December 2013 outstanding commitments to private equity funds amounted to £87 million or 8% of NAV (compared to £94 million at 30 September 2013). As at that date Electra had £358 million of liquid resources (net of bank borrowings). As at 3 February 2014, following the investment in Hotter and net of the commitment to invest in OFS, Electra had £204 million of liquid resources (net of bank borrowings).
4 Investment Portfolio
* 31 Dec 2013 | 30 Sept 2013 | |
£m | £m | |
Direct unlisted | 603 | 662 |
Secondaries | 115 | 126 |
Funds | 94 | 93 |
Listed | 100 | 87 |
Investment portfolio | 912 | 968 |
* Valued on the basis of Note 1 (Unaudited Net Asset Value) as set out above
In the three months to 31 December 2013 currency movements decreased the value of the portfolio by£5 million, although this was partially offset by gains of £2 million arising from the hedging arrangements of drawings under Electra's multi-currency loan facility.
5 Investments and Realisations
Electra invested a total of £15 million in the three months to 31 December 2013, excluding the investment in Hotter and the commitment to invest in OFS, which were made in January 2014 and February 2014 respectively.
Realisations inclusive of income over the same period totalled £89 million including £37 million of proceeds received from the sale of Lil-lets Group, £15 million received by way of loan repayments from AXIO Data Group, £12 million from the part disposal of the holding in LondonMetric Property and £9 million received as a result of distributions from the EP1 Secondary Portfolio.
6 Key Investments
Key Direct Unlisted Investments and Secondary Investments*
Fair value of holding at30 Sept 2013 | Netpayments/(receipts) | Net performance in period | ** Fair value of holding at31 Dec 2013 | Cost of holding at31 Dec 2013 | |
Company | £'000 | £'000 | £'000 | £'000 | £'000 |
EP1 Secondary Portfolio | 105,633 | (9,442) | (1,538) | 94,653 | 63,606 |
AXIO Data Group | 104,804 | (14,663) | 177 | 90,318 | 72,674 |
Park Resorts | 86,823 | (411) | 80 | 86,492 | 69,571 |
Allflex Corporation | 52,856 | − | (1,129) | 51,727 | 56,656 |
Allen & Heath | 42,275 | (374) | 374 | 42,275 | 42,275 |
Peverel Group | 39,943 | − | − | 39,943 | 21,973 |
Premier Asset Management | 35,904 | − | − | 35,904 | 56,069 |
Nuaire | 35,180 | 27 | − | 35,207 | 23,115 |
Daler-Rowney | 27,524 | − | − | 27,524 | 17,435 |
Promontoria | 27,104 | − | (110) | 26,994 | 12,606 |
South Lakeland Parks | 21,218 | − | − | 21,218 | 21,218 |
BDR Thermea | 19,300 | 2 | (79) | 19,223 | 13,472 |
PINE | 18,250 | (295) | 297 | 18,252 | 14,032 |
Davies Group | 14,832 | 3,074 | − | 17,906 | 38,862 |
Cala Group | 15,642 | 1,641 | − | 17,283 | 14,944 |
Labco | 16,266 | − | (65) | 16,201 | 25,336 |
Sentinel Performance Solutions | 13,471 | − | − | 13,471 | 15,535 |
Sub total | 677,025 | (20,441) | (1,993) | 654,591 | 579,379 |
Other investments | 111,869 | (48,419) | 15 | 63,465 | |
Total Direct Unlisted and Secondary investments | 788,894 | (68,860) | (1,978) | 718,056 |
Key Direct Listed Investments*
Fair value of holding at30 Sept 2013 | Netpayments/(receipts) | Net performance in period | ** Fair value ofholding at31 Dec 2013 | Cost of holding at 31 Dec 2013 | |
Company | £'000 | £'000 | £'000 | £'000 | £'000 |
Zensar Technologies | 23,754 | − | 12,439 | 36,193 | 4,072 |
LondonMetric Property | 31,105 | (12,077) | 4,631 | 23,659 | 17,404 |
Sub total | 54,859 | (12,077) | 17,070 | 59,852 | 21,476 |
Other investments | 31,946 | 5,134 | 2,886 | 39,966 | |
86,805 | (6,943) | 19,956 | 99,818 |
* Excludes liquidity funds
** Valued on the basis of Note 1 (Unaudited Net Asset Value) as set out above
7 Hotter Shoes
In January 2014 Electra invested £85 million in the buyout of Hotter Shoes, a leading UK designer, manufacturer and retailer of stylish and comfortable footwear. Headquartered in Lancashire, Hotter operates from one of the most advanced shoe making facilities in the world and sells over two million pairs of shoes each year in the UK and internationally.
8 Ogier Fiduciary Services
On 3 February 2014 it was announced that Electra had agreed to invest £83 million in the acquisition of Ogier Fiduciary Services ("OFS"), the fiduciary services division of the Ogier Group. Completion of the transaction is subject to certain conditions including regulatory approvals which are anticipated within six months. OFS provides trust, fund and company administration services to corporates, private clients and investment funds.
Disclaimer
This statement aims to give an indication of material events and transactions that have taken place during the period from 1 October 2013 to the date of publication of this statement and their impact on the financial position of Electra Private Equity PLC. These indications reflect the Board's current view. They are subject to a number of risks and uncertainties and could change. Factors which could contribute to such difficulties include, but are not limited to, general economic and market conditions and specific factors affecting the financial prospects or performance of individual investments within Electra's portfolio.
No information contained in this announcement shall form the basis of, or be relied upon in connection with any offer or commitment whatsoever in any jurisdiction.
The announcement is not an offer to sell or a solicitation of any offer to buy any securities of Electra Private Equity PLC (the "Company" and any securities, the "Securities") in the United States or any other jurisdiction. The Company is not registered under the U.S. Investment Company Act, as amended (the "Investment Company Act"), and holders of any Securities will not be entitled to the benefits of the Investment Company Act. These securities have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act") and may not be reoffered, resold or transferred in the United States or to, or for the account or benefit of U.S. persons (as such term is defined in Regulation S under the Securities Act) unless registered under the Securities Act or an exemption from such registration is available. Copies of this announcement are not being, and should not be distributed or sent into the United States, Canada, Japan, Australia or New Zealand. No public offering of Securities is being made in the United States. If for any reason in the future an offering of the Securities is made, such offering will be made by means of a prospectus that may be obtained from the Company and will contain all relevant information about the Company, its management and its financial statements.
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