Final Results

Pantheon International Participations PLC (PIP) Preliminary Announcement of Results for the year ended 30 June 2006 Chairman's Statement Private equity markets globally have shown continuing strength with realisations from investments reaching unprecedented levels and valuation trends remaining strongly positive. Consequently PIP's portfolio of investments in private equity funds has shown good performance in the year to 30th June 2006 leading to an increase in PIP's net asset value per share of 21.1% to 796.8p. Our total assets increased by £59.5 million to £441.0 million after redeeming £20 million of redeemable shares. The 21.1% increase in PIP's net asset value per share compares to increases in the MSCI World index of 16.9% and the FTSE All Share index of 19.7% respectively. The 11.7% increase in PIP's ordinary share price during the year did not match the increase in PIP's net asset value per share because the share price discount had widened to 8.8% at the year end. Since then PIP's share price has been trading closer to net asset value per share. Adverse currency movements, in particular the US dollar which declined 3.2% against sterling over the year, resulted in a £5.7m reduction in the sterling value of the portfolio. INVESTMENT ACTIVITY The past year has been an active one for both investment and realisations. PIP invested £131.2 million in underlying private equity assets during the period, an increase of 13% over the previous year. Of this amount, £59.5m was paid to meet investment calls arising from PIP's primary portfolio and £71.7m was applied to the secondary portfolio. The total amount of cash distributed to PIP as a result of investment realisations during the period was £156.8 million. This represents an increase of 74% over the previous year and is equivalent to approximately 50% of opening private equity asset value. Of this amount, £59.8m resulted from the primary portfolio although the majority of distributions, £ 97.0m, came from the secondary portfolio bearing out a tendency of secondary purchases to return cash sooner than primary investments. This high level of liquidity is testament to the quality and maturity of PIP's portfolio as well as to the current favourable market conditions. PRIMARY COMMITMENTS The rate of private equity fund raising increased again during the year under review, boosted by the number of large funds coming to the market and raising significantly greater amounts. Despite the growth in fund sizes at the top end, many of the best funds are still oversubscribed. Pantheon's relationships with top-tier managers have helped ensure that PIP continues to access high-demand funds worldwide. PIP's commitments to primary investments reached its highest level of £159.2 million over the year to end June 2006, encompassing 12 Europe-focused funds (£ 75.6m) and 20 US focused funds (£83.6m), representing many of the most attractive opportunities from among the hundreds of new fund offerings available during the period. In addition, PIP gained exposure to 6 new Asian funds through the investment in Pantheon Asia Fund IV Limited. In line with the growth of PIP's private equity portfolio, the Board increased the rate that PIP commits to primary funds from £300 million to £450 million over a three-year period. SECONDARY COMMITMENTS During the year PIP committed £80.7 million to five secondary transactions to purchase existing interests in private equity funds. The majority of the assets added to the portfolio through these investments were US venture funds, during a period when the venture sector appears at last to be enjoying some revival, as evidenced by a number of prominent trade sales and successful IPOs. MARKET REVIEW AND PROSPECTS Growth in the global private equity market has continued, with the buyout industry raising record amounts on the back of the good investment returns generated in recent years. The pace of realisations during the year has been bolstered by low interest rates, accommodating debt markets and an increase in M&A activity occasioned by the return of the corporate buyer. In addition, the venture markets are showing signs of renewed life and, with 27% of the portfolio in venture capital funds, PIP is well placed to benefit from further recovery. Pantheon expects the current high levels of fundraising, distributions and deal flow to continue whilst the favourable economic environment persists. Although these predictions might tend to reinforce optimism regarding prospects for private equity in the short to medium term, the industry is cyclical in nature and some market commentators are predicting that the current peak in fundraising will mark the top of the market cycle. As ever, the watchword for investors in private equity must be selectivity, with prudent investment decisions based not only on evaluation of a firm's track record and discipline but also on a judgement as to whether future conditions will be such that the manager's strategy will continue to deliver superior performance. PIP's primary programme strategy aims to create a portfolio of top tier funds that provides exposure globally to attractive market segment. Deal flow remains strong within the secondary market resulting from a growth in the number of investors who are selling in order to actively manage their portfolios. Pantheon believes that the secondary market will continue to expand as the scale of the primary market grows and as the secondary market matures. CAPITAL STRUCTURE PIP redeemed £20m in value of Redeemable Shares during the year in order to release surplus cash arising from the high level of distributions received from the portfolio. PIP's ability to redeem surplus cash ensures that the Board can prevent an accumulation of excessive cash, thereby helping to counter the effect of 'cash drag' on investment performance. ANNUAL GENERAL MEETING AND PRESENTATION The Annual General Meeting of the Company will take place at 12 noon on 22nd November 2006 at Pantheon's office. Pantheon will give a presentation on the progress of PIP's portfolio. Both the Directors and Pantheon look forward to meeting shareholders informally after the meeting. TOM BARTLAM Chairman 26 September 2006 INCOME STATEMENT (unaudited) for the year ended 30 June 2006 Restated 2005 Revenue Capital Total* Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Gains on investments ** - 79,356 79,356 - 51,947 51,947 Currency timing differences - 263 263 - 161 161 Income Dividends and interest 7,521 - 7,521 4,589 - 4,589 Investment management fee (5,410) - (5,410) (4,130) - (4,130) Other expenses (804) (141) (945) (824) 257 (567) Return on ordinary activities before financing costs and tax 1,307 79,478 80,785 (365) 52,365 52,000 Interest payable and similar charges (852) - (852) (1,256) - (1,256) Return on ordinary activities before tax 455 79,478 79,933 (1,621) 52,365 50,744 Tax on ordinary activities - (385) (385) - (516) (516) Return on ordinary activities after tax 455 79,093 79,548 (1,621) 51,849 50,288 Return per ordinary and redeemable share - basic 0.80p 138.74p 139.54p (3.87)p 119.43p 115.56p Return per PLN N/A N/A N/A - 8.49p 8.49p All revenue and capital items in the above statement relate to continuing operations. * The total column of this statement represents the Company's profit and loss statement prepared in accordance with UK Accounting Standards. The supplementary revenue return and capital columns are both prepared under guidance published by the Association of Investment Trust Companies. ** Includes currency movements on investments. RECONCILIATION OF MOVEMENT IN EQUITY SHAREHOLDERS' FUNDS Share Capital Share PLN Special Capital Capital Revenue Total capital premium reserve reserve- reserve- reserve redemption reserve realised unrealised reserve £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Movement for the year ended 30 June 2006 Opening - - equity shareholders funds 18,050 91,959 119,962 111,125 55,679 (15,287) 381,488 Return for - - the year - - - 40,539 38,554 455 79,548 Buy back of 26 - redeemable shares (26) - (20,065) - - - (20,065) Over accrual - - on costs of issue of redeemable shares - 12 - - - - 12 Closing 26 - Equity shareholders funds 18,024 91,971 99,897 151,664 94,233 (14,832) 440,983 Movement for the year ended 30 June 2005 Opening - 121,555 equity shareholders funds 14,467 6,034 - 105,369 11,425 (13,666) 245,184 Return for - - the year - - - 7,595 44,254 (1,621) 50,228 Revaluation - 1,839 of PLNs - - - (1,839) - - - Issue of - shares from PLN cancellation 3,268 - (1,453) - - - - 1,815 Issue of - (123,394) redeemable shares 315 207,340 - - - - 84,261 Transfer to - - special reserve - (119,962) 119,962 - - - - Closing Equity - shareholders funds 18,050 - 91,959 119,962 111,125 55,679 (15,287) 381,488 BALANCE SHEET (unaudited) As at 30 As at 30 June 2006 June 2005 £'000 £'000 Fixed assets Investments* 434,087 371,950 Investment in - 1 subsidiary undertaking 434,087 371,951 Current assets Debtors 1,882 2,868 Cash at bank 6,636 12,507 8,518 15,375 Creditors - amounts 1,622 5,838 falling due within one year Net current assets 6,896 9,537 Total assets less 440,983 381,488 current liabilities Capital and reserves Called-up share 18,024 18,050 capital Capital redemption 26 - reserve Share premium account 91,971 91,959 PLN reserve - - Special reserve 99,897 119,962 Capital reserve 245,897 166,804 Revenue reserve (14,832) (15,287) Total equity 440,983 381,488 shareholders' funds * Includes fixed interest investments held for cash management purposes As at As at 30 June 2006 30 June 2005 Number of ordinary 67p shares in issue 26,471,013 26,471,013 Number of redeemable 1p shares in issue 28,871,255 31,513,199 Net asset value per share- basic 796.8p 657.9p CASHFLOW STATEMENT (unaudited) Year Year ended ended 30 June 30 June 2006 2005 £'000 £'000 Cash flow from operating activities Investment income received 7,701 4,232 Deposit interest received - - Investment management fees paid (5,791) (3,464) Secretarial fees paid (133) (105) Other cash payments (616) (584) Net cash inflow from operating activities 1,161 79 Returns on investments and servicing of finance Revolving credit facility and overdraft interest paid (10) (409) Loan commitment and arrangement fees paid (386) (301) Redeemable share and PLN commitment fees paid (500) (751) Net cash outflow from returns on investment and servicing (896) (1,461) of finance Taxation Withholding tax suffered on limited partnership (438) (516) distributions Tax recovered - - Net cash outflow from taxation (438) (516) Capital expenditure and financial investment Purchases of investments (135,888) (113,758) Purchases of government securities (417,027) (57,199) Disposals of investments 154,271 87,168 Disposals of government securities 412,702 - Realised currency gains 9 22 Net cash inflow/(outflow) from capital expenditure and (83,767) financial investment 14,067 Net cash inflow/(outflow) before financing 13,894 (85,665) Financing Proceeds from issue of redeemable shares - 87,529 Costs of ordinary and redeemable share issues 12 (1,453) Payments to buy back redeemable shares (20,000) - Costs of buy back of redeemable shares (65) - Realised currency gains on repayment of revolving credit 34 facility - Net cash (outflow)/inflow from financing (20,053) 86,110 (Decrease)/increase in cash (6,159) 445 These accounts have been prepared using accounting standards and policies adopted at the year-end except as explained below. This report has been prepared using new accounting standards, which have been issued to begin the process of converging UK standards with International Financial Reporting Standards ('IFRS'). The applicable standards that have been adopted by the Company with effect from 1 July 2005 are FRS 21 Events after the Balance Sheet Date; FRS 22 Earnings per share, FRS 23 The Effects of Changes in Foreign Exchange Rates, FRS 25 Financial Instruments: Disclosure and Presentation, FRS 26 Financial instruments: Measurement and FRS 28 Corresponding Amounts. All investments held by the Company are classified as 'fair value through profit or loss'. For investments actively traded in organised financial markets, fair value is generally determined by reference to Stock Exchange quoted market bid prices at the close of business on the balance sheet date. For investments that are not actively traded on organised financial markets, fair value is determined using reliable valuation techniques as described in detail in the Company's last Annual Report. There is no material effect on the portfolio as a result of this change. Under FRS25, Participating Loan Notes (PLNs) have been classified as equity. The revaluation of PLNs in the year ended 30 June 2005 is now treated as an allocation of profits. This has no effect on the return to ordinary and redeemable shareholders. As the PLNs were converted to ordinary and redeemable shares on 20 September 2004, there is no restatement effect to the Balance Sheet at 30 June 2005 or 30 June 2006. The above financial information does not constitute statutory accounts as defined in Section 240 of the Companies Act 1985. The comparative financial information for the year ended 30 June 2005 is taken from the full accounts, which have been delivered to the Registrar of Companies and contained an unqualified audit report and did not contain statements under S.237(2) or (3) of the Companies Act 1985. Statutory financial statements for the year ended 30 June 2006 have not yet been approved, audited or filed and will be delivered to the Registrar of Companies following the Annual General Meeting. For further information please contact: Rhoddy Swire, Director of Pantheon International Participations PLC - 020 7484 6200 Alastair Bruce, Pantheon Ventures Limited - 020 7484 6200 Andrew Lebus, Pantheon Ventures Limited - 020 7484 6200 Email: contactus@pipplc.com Signed on behalf of the Board Tom H. Bartlam Chairman
UK 100

Latest directors dealings