Neuberger P.e. Regulatory News (NBPE)

NB Private Equity Partners (NBPE)

01/10/2025

Results analysis from Kepler Trust Intelligence

NB Private Equity Partners (NBPE) has released its interim results for the six months to 30/06/2025. The net asset value (NAV) total return was 4% over the period, whilst the share price total return was -7.6%. The private investment portfolio reported revenue and EBITDA growth of 8.8% and 9.8% respectively, representing only a slight moderation of EBITDA growth from the previous financial year. Valuations declined modestly, and now stand at a weighted average of 15.4x on an EV/ EBITDA basis. Since 2021, the managers note that the portfolio's overall valuation multiple has contracted significantly.

Performance across NBPE's 10 largest private investments, which represent 31% of the portfolio, has been particularly strong, reporting weighted average LTM (last twelve month) revenue growth of 13.7% and LTM EBITDA growth of 15.9%. Given the maturity of the portfolio (average age of portfolio 5.6 years), the managers report that they believe the portfolio has a number of high quality 'exit ready' companies which should drive liquidity and performance as markets improve.

NBPE continues to maintain a strong balance sheet, supported by its co-investment model and minimal unfunded commitments. The investment level was 101%, at the lower end of the target 100-110% range. This financial flexibility allows NBPE to pursue new investments, maintain dividend payments, and fund an increasing level of share buybacks without compromising balance sheet stability. Since June the board have increased the level of buybacks, repurchasing approximately $5.8m worth. This buyback activity has been in addition to the $0.94 per share, or approximately $43m, returned to shareholders this year by way of dividends.

Kepler View

In our view, it is a strong positive for prospects that NBPE's largest investments are growing fastest. Optimism on prospects for a recovery in the private equity exit environment were running high at the start of 2025, which were blown off course by President Trump unleashing his barrage of tariffs in April. We are hopeful that the last quarter of 2025, and the run into the year-end might see momentum build once again. With the largest companies in the portfolio driving performance, NBPE is primed for just such an eventuality, with the companies most able to 'move the needle' in NAV terms performing well and potentially 'exit-ready'.

The discount to NAV of 30% remains wide in absolute terms, but is broadly in-line with peers. Yet in our view, NBPE offers a unique proposition that is especially well placed to navigate a continued slowdown in private equity deal activity. On the other hand, the portfolio looks increasingly well placed to benefit should exit conditions improve. It does not pay two layers of fees on the vast majority of co-investments, making it cost-effective relative to many peers. As such, for investors who can take a long-term view, the discount to NAV could represent an opportune entry point.

CLICK HERE TO READ THE FULL REPORT  Visit Kepler Trust Intelligence for more high quality independent investment trust research.

Important information

This report has been issued by Kepler Partners LLP. The analyst who has prepared this report is aware that Kepler Partners LLP has a relationship with the company covered in this report and/or a conflict of interest which may impair the objectivity of the research.

Past performance is not a reliable indicator of future results. The value of investments can fall as well as rise and you may get back less than you invested when you decide to sell your investments. It is strongly recommended that if you are a private investor independent financial advice should be taken before making any investment or financial decision.

Kepler Partners is not authorised to make recommendations to retail clients. This report has been issued by Kepler Partners LLP, is based on factual information only, is solely for information purposes only and any views contained in it must not be construed as investment or tax advice or a recommendation to buy, sell or take any action in relation to any investment.

The information provided on this website is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject Kepler Partners LLP to any registration requirement within such jurisdiction or country. In particular, this website is exclusively for non-US Persons. Persons who access this information are required to inform themselves and to comply with any such restrictions.

The information contained in this website is not intended to constitute, and should not be construed as, investment advice. No representation or warranty, express or implied, is given by any person as to the accuracy or completeness of the information and no responsibility or liability is accepted for the accuracy or sufficiency of any of the information, for any errors, omissions or misstatements, negligent or otherwise. Any views and opinions, whilst given in good faith, are subject to change without notice.

This is not an official confirmation of terms and is not a recommendation, offer or solicitation to buy or sell or take any action in relation to any investment mentioned herein. Any prices or quotations contained herein are indicative only.

Kepler Partners LLP (including its partners, employees and representatives) or a connected person may have positions in or options on the securities detailed in this report, and may buy, sell or offer to purchase or sell such securities from time to time, but will at all times be subject to restrictions imposed by the firm's internal rules. A copy of the firm's Conflict of Interest policy is available on request.

PLEASE SEE ALSO OUR TERMS AND CONDITIONS

Kepler Partners LLP is authorised and regulated by the Financial Conduct Authority (FRN 480590), registered in England and Wales at 70 Conduit Street, London W1S 2GF with registered number OC334771.