HgCapital Trust plc Regulatory News (HGT)

6 May 2008 07:00

HgCapital Trust plc - Interim Management Statement 6th May 2008

HgCapital Trust plc ("the Company"), today issues its Interim Management Statement in accordance with FSA Disclosure and Transparency Rule 4.3. This statement relates to the period from 1st January 2008 to 6 May 2008 and incorporates the Company's calculation of its net asset value at the end of April, in the same form as is issued following the end of each month. The Net asset value (NAV) at April is based on the valuations of unquoted investments as at 31st December, as set out in the annual report, but is adjusted for realisations, exchange rates, changes in value of quoted securities, and net revenues during the period.

Investment activity during the period

Since the end of the year the Company has completed one further realisation (Classic Copyright), in addition to completing the realisations described in the annual report and received some deferred proceeds, totalling ‚£61.8 million cash proceeds for the Company. One acquisition (Casa Reha) which is described in the annual report has been completed with the Company investing ¢â€š¬ 13.4 million.

Performance since the year-end

Since 31st December the total return (NAV plus dividend) was 9.0%, compared with the negative total return of -4.2% of the FTSE All-Share Index. The Company's share price at the end of April was 881.0 pence, a discount of 12.6% against the NAV (on an ex-div basis) of 1,007.82 pence. The Company's share price (on a total return basis) increased by 16.0% over the four months to 30th April while the FTSE All-Share Index and FTSE SmallCap Index fell by 4.2% and 7.0% respectively on a total return basis.

Roger Mountford, the Chairman of the Company, said:

"Despite the volatility in financial markets HgCapital Trust has achieved a good start to the year, completing a series of realisations at prices materially above their valuations at 31st December 2007. As the difficulties of financial markets feed into the wider economy it becomes all the more valuable that our manager, HgCapital, is represented on the board of every material investment in the portfolio and therefore able to monitor closely and, where necessary, ensure that management reacts to changes in trading conditions and performance. Our manager has reported that so far only a small number of companies within the portfolio appear to be suffering from changes in trading conditions in their respective markets, with the majority on or ahead of plan at this stage.

"The recent falls in equity markets have created a better environment for purchasers able to identify sound businesses, though as expected this is not yet recognised by all vendors of private businesses. The Company enters this part of the investment cycle with substantial resources available for investment and, in the Board's view, remains an attractive vehicle for investors seeking long-term growth."

Investment objective

HgCapital Trust plc gives the investor access to a private equity portfolio run by an experienced and well-resourced Manager that makes investments in fast growing companies over a number of geographies and sectors.

The objective of the Company is to provide shareholders with long-term capital appreciation in excess of the FTSE All-Share Index by investing in unquoted companies. The Company provides investors with exposure to a diversified portfolio of private equity investments primarily in the UK and Continental Europe.

The Company's Benchmark is the FTSE All-Share Index.

Performance

All information is at 30th April 2008 and is unaudited.

Performance at month end with net income reinvested

One month Three One year Three years Five years months Net asset value 2.1% 5.5% 35.9% 120.0% 231.4% Share price 6.1% 5.5% 4.9% 91.5% 335.8% FTSE All-Share 6.3% 4.9% -4.3% 42.7% 93.1%Index

Sources: HgCapital, Capital Economics

ResultsAt 30th April 2008Net asset value:* 1,007.82p Share price: 881.00p Discount 12.6% Total assets: ‚£253.8m Net yield: 2.8% Gearing: Nil% Ordinary shares in issue: 25,186,755

* includes 4 months net revenue of 22.66p and is after providing for payment of the dividend of 25p payable on 12 May 2008 and after providing for the carried interest

Unaudited Net Asset Value per Share

The investment portfolio has not been revalued at 30th April 2008. However, it is calculated on the basis of the NAV at 31st December 2007 adjusted to reflect the purchases and sales of investments, currency movements and bid values in respect of listed investments. The unaudited net asset value at 30th April 2008 was 1,007.82 pence per share by comparison with 948.20 pence at 31st December 2007, an increase of 6.3%. This is after a carried interest liability of 21.3 pence included in the balance sheet.

On the 17th March 2008, the Board declared a dividend of 25 pence per share. This is payable on the 12th May 2008 and after providing is included as a liability in the balance sheet as at the 30th April 2008.

Net revenue for the four months to 30th April 2008 was 22.66p.

Balance Sheet

At the 30th April 2008, the Company's balance sheet was comprised as follows:

‚£m % Unquoted investments 127,540 50.2 Quoted investments 1,986 0.8 ----------- ------ Total investment portfolio 129,526 51.0 Cash/Gilts 123,216 48.6 Other net assets 1,095 0.4 ----------- ------ Net asset value 253,837 100.0Investments

During the period, the Company made one new investment in Casa Reha, one of the leading German private nursing home groups, with an enterprise value of ¢â€š¬327 million. The company invested ¢â€š¬13.4 million.

Realisations

During the period, the Manager completed the sales of Hofmann Menƒ¼, The Sanctuary Spa, Clarion Events and Classic Copyright, as well as selling its remaining shares in Xyratex and PRA and receiving some deferred proceeds, returning a total of ‚£61.8 million to the Company.

PortfolioTen Largest InvestmentsCompany Total Assets % Sector VISMA 5.8 TMT Casa Reha 4.2 Healthcare Voyage Heathcare 3.5 Healthcare Atlas t/a Atlas 3.2 Services Interactive Addison 3.2 TMT BMFCO UA t/a Fabory 3.1 Services Mondo Minerals Co-op 3.1 Industrials Sporting Index 2.8 Consumer & Leisure SLV Electronics 2.7 Industrials SHL 2.6 Services Total 34.2 Sector Total Assets % TMT 13.2 Industrials 9.3 Consumer & Leisure 8.8 Healthcare 8.4 Services 9.0 Renewable Energy 1.6 Other 0.7 Fixed Interest 44.8 Net current assets 0.4 Cash 3.8 Total 100.0

This statement is a general description of the financial position and performance of the Company for the period from 1st January 2008 to 6 May 2008. It does not contain any profit forecast or forward looking information. Future performance and share price is likely to be affected by a number of factors, including (but not limited to) general economic and market conditions and specific factors affecting the financial performance or prospects of individual investments within the Company's portfolio.