ICG Enterprise Trust Regulatory News (ICGT)

8 December 2015

GRAPHITE ENTERPRISE TRUST PLC

INTERIM MANAGEMENT STATEMENT

PERIOD ENDED 31 OCTOBER 2015

Graphite Enterprise Trust PLC ("Graphite Enterprise" or "the Company") presents its Interim Management Statement for the period ended 31 October 2015.

Performance overview1

In the nine months to 31 October, the net asset value per share increased by 2.9% to 694.9p. In the same period the FTSE All-Share Index fell by 0.9%.

The share price performed strongly in the nine months, increasing by 10.5%. An interim dividend of 5.0p per share was paid to shareholders on 20 October.

In the nine months, the value of the portfolio in local currencies increased by 7.6%. As the Company was 84% invested at the start of the year, this generated a 6.5% increase in the net asset value. The impact of currency movements on euro-denominated investments and cash balances reduced the net asset value by 2.3%, with expenses and other items reducing it by a further 1.3%. Overall, the net asset value increased by 2.9%.

The long term performance of the Company remains strong, with both the net asset value and the share price comfortably outperforming the Index over five and ten years.

In the most recent quarter, the three months to 31 October, the net asset value decreased slightly by 0.1%. As few of the managers of our fund portfolio revalue their investments at September, the great majority of the portfolio effectively remains at its reported June valuation. Further details about performance and activity in the quarter are presented below.

1. All performance figures are on a total return basis, including the effect of re-invested dividends.

Performance and activity in the quarter

Net asset value

A small decrease in the underlying valuation of the portfolio was more than offset by positive currency movements, with the result that the total valuation of the portfolio increased the net asset value by 0.3%. The impact of expenses and other items reduced the net asset value by 0.4%. Overall, the net asset value decreased slightly by 0.1%.

Proceeds

The portfolio generated £14.7 million of cash proceeds in the three months to 31 October. Eight full realisations were completed and these accounted for 68% of the proceeds received.

The amounts received in the quarter brought total proceeds received from the portfolio in the year to date to £88.2 million, or 20% of the opening portfolio. The full realisations brought the number completed in the year to 27 and these accounted for £55.6 million or 63% of the total proceeds received. The average uplift to the previous carrying value was 24% and the average return over the life of the investments was 1.8 times original cost. The remaining £32.6 million or 37% of total proceeds was generated by a combination of refinancings, IPOs, sell-downs of listed holdings by third party managers and other partial realisations.

Additions and new commitments

The slowdown in new investment activity, which we highlighted in the interim report, has continued, with £4.6 million invested in the quarter. This brings the total invested in the nine months to £37.5 million.

A total of 10 new underlying investments were made in the quarter. This brought the total for the year to date to 40.

In addition to the cash invested, we committed £3.9 million to a co-investment in Swiss Education Group, a provider of hospitality training in Switzerland, alongside Invision Private Equity, which completed shortly after the period end.

The Company made two new commitments to buy-out funds in the quarter. Both are existing manager relationships for Graphite Enterprise. The first was of €15 million to Charterhouse Capital Partners X and the second was of $20 million to TH Lee Equity Fund VII. The latter was our first commitment to a US focused buy-out manager since 2007.

Cash and liquid assets

The portfolio generated a net £10.1 million of cash in the three months to 31 October. Non-investment cash flows and adverse currency movements reduced cash by £2.8 million. The interim dividend of 5.0p per share returned £3.6 million to shareholders, and the Company bought back £0.4 million of shares. Overall, cash and liquid assets increased by £3.3 million to £104.4 million.

Since the quarter end the cash balance has decreased to £95.8 million at 7 December, mainly due to net investment into the portfolio of £6.7 million and share buy-backs of £1.9 million.

Balance sheet and commitments

The summary balance sheet and commitment position at 31 October 2015 is set out below. The Company was 79% invested at that date.

1. £50.0 million and €58.1 million translated into sterling at period end

2. Cash and liquid assets plus undrawn borrowing facilities

3. Outstanding commitments less total liquidity

Outstanding commitments increased by £24.1 million to £272.8 million in the quarter, primarily due to new primary commitments of £24.0 million (as discussed above).

Events since the quarter end

Other than as discussed above, the Directors are not aware of any events or transactions which have taken place between 31 October 2015 and the date of publication of this statement which have had a material effect on the financial position of the company.

Not audited or reviewed

This information has not been audited or reviewed by the Company's auditors.

For further information please contact:

SUPPLEMENTARY INFORMATION

The 30 largest underlying INVESTMENTS

The table below presents the 30 companies in which Graphite Enterprise had the largest investments by value at 31 October 2015. These investments may be held directly or through funds, or in some cases in both ways. The valuations are gross and are shown as a percentage of the total investment portfolio.

+ All or part of this investment is held directly as a co-investment or other direct investment.

* Quoted investment.

** We are not permitted to disclose the details of this co-investment under the terms of a confidentiality agreement.

The 30 largest fund investments

The 30 largest funds by value at 31 October 2015 are set out below:

* Includes the associated Top Up fund(s)

** All or part of interest acquired through a secondary fund purchase

Portfolio analySIS

The following five tables analyse the companies in which Graphite Enterprise had investments at 31 October 2015.

Portfolio - Investment type

Portfolio - Geographic distribution*

* Location of headquarters of underlying companies in the portfolio. Does not necessarily reflect countries to which companies have economic exposure.

Portfolio - Sector analysis

Quoted equity holdings at 31 October 2015

All quoted holdings, other than Intermediate Capital Group, are held indirectly through third party funds and may have restrictions on their sale. The timing of any disposal of these interests is determined by the managers of those funds.

The following table analyses the closing portfolio by value.

Graphite and third party investments at 31 October 2015

*Includes Graphite Capital funds, all secondary fund interests and all direct investments

Investment activity

The following two tables analyse the investment activity of Graphite Enterprise in the three months to 31 October 2015.

Largest new underlying investments

Largest underlying realisations

Commitments analysis

The following four tables analyse Graphite Enterprise's commitments at 31 October 2015.

1 Original commitments are translated at 31 October 2015 exchange rates

\* This commitment was in respect of the co-investment in Swiss Education Group, which completed in November.

New commitments in the three months to 31 October 2015

CURRENCY EXPOSURE

*Currency exposure is calculated by reference to the location of the underlying portfolio companies' headquarters.

NOTES

Graphite Enterprise Trust PLC

Graphite Enterprise Trust PLC ("Graphite Enterprise" or "the Company") aims to provide shareholders with long term capital growth through investment in unquoted companies. To achieve this, the Company invests in private equity funds and also directly in private companies.

The Company has been listed on the London Stock Exchange since 1981 and has invested exclusively in private equity and has had the same manager throughout its life.

Graphite Enterprise provides access to a diverse portfolio of buy-outs of mature, profitable companies in established private equity markets, principally in Europe. The Company invests in UK-based mid-market companies through funds managed directly by Graphite Capital. Typically these will make up 20-25% of the portfolio. Investments in other UK companies and in overseas markets are made through funds managed by third parties. The Company does not invest in start ups or early stage businesses. Direct investments in companies may be made alongside both Graphite Capital and third party funds.

Shareholders of Graphite Enterprise gain exposure to a diverse portfolio of buy-outs of mature, profitable companies in established private equity markets, with nearly 400 underlying companies. Graphite Capital directly manages many of the largest companies in the portfolio.

Since inception, the Company has generated a return of over 29 times the amount subscribed.

www.graphite-enterprise.com 

The Manager - Graphite Capital

Graphite Capital is one of the UK's leading mid-market private equity firms with over £1.3 billion of funds under management. It has raised and managed funds for 34 years. The senior management team has worked together for 18 years.

Graphite Capital manages both direct investments in portfolio companies and private equity fund investments.

Direct investments are predominantly made through institutional funds with a global investor base. The focus of direct investments is on UK mid-market buy-outs of companies valued at between £25 million and £200 million across a range of industry sectors.

Fund investments are made exclusively by Graphite Enterprise. Fund investments focus principally on European buy-out funds. The investment strategy is to back private equity managers with strong track records operating in mature markets, with the aim of building long term relationships.

As Graphite Capital has a long experience both of managing its own funds and of investing in third party funds, it has an unusually broad perspective when assessing fund and co-investment opportunities. Graphite Enterprise benefits from both the expertise of a dedicated fund investment team as well as the insights of Graphite Capital's direct investment team.

www.graphitecapital.com