Final Results
HgCapital Trust plc
Announcement of Results for the year ended 31 December 2010
London, 18 March 2011: HgCapital Trust plc (or "the Trust"), which provides investors with a listed vehicle to invest in all private equity deals managed by HgCapital, today announces its results for the year ended 31 December 2010.
Financial highlights of 2010
§ Total return (share price plus dividend) growth of +22.8% in year; outperformed FTSE All-Share Index by 8.3%.
§ Long term outperformance: 10 year annual compound total return to shareholders of 14.0% p.a., a substantial outperformance against the 3.7% p.a. return from the FTSE All-Share Index
§ Total return (NAV plus dividend) increase of +22.6% (basic); +19.5% increase on a diluted basis. NAV per share increased from 937.2 pence per share at the beginning of the year to 1,118.8 pence per share basic (1,090.7 pence per share diluted) at 31 December 2010.
§ Growth: Average EBITDA and revenue growth for the Trust's top 20 buy-out investments (92% of the portfolio) of 16% and 13% respectively over the 12 months to 31 December 2010.
§ Realisations in 2010 totalled £82 million, primarily from the sale of Pulse Staffing and Hoseasons and the partial sale of Visma, at an average uplift over book value at 31 December 2009 of 64%. Average proceeds over book value have been 1.8x on last 30 exits.
§ Record year for investments: £111m invested, mainly in seven new buyout investments and renewable energy projects.
§ Growth in net assets of £ 112 million helped by £50 million proceeds (pre expenses) from a placing and open offer of new ordinary shares that completed in April 2010 at £8.45 per share, improving the liquidity in the Trust's shares.
Post-year end
§ Proposed final dividend for the year ended 31 December 2010 of 28.0 pence per ordinary share to be paid on 13 May 2011, subject to shareholder approval, 100% designated as a distribution of interest.
§ In February 2011, the sale of SiTel (Elite) was completed, the Trust's share of proceeds was £9.4 million and compares to a carrying value as at 31 December 2010 of £5.4 million, an uplift of £4.0 million (13.1 pence per share basic; 10.9 pence per share diluted).
§ In March 2011, the Trust contributed £9.9 million towards an investment in ATC Group, a leading independent provider of corporate services to multinational corporations and financial institutions.
§ Basic NAV per share at 28 February 2011 of 1,131.4 pence per share basic (1,101.2 pence per share diluted) with 25.1% of net assets in liquid funds.
Operational Highlights
§ 2010 offered an improving backdrop for the businesses in the Trust's portfolio, reflected in a strong increase in valuation. The unrealised portfolio appreciated in value by £35.9 million (2009: £5.8 million), primarily driven by strong earnings growth. Realised gains (including interest) over December 2009 book value were £32.0 million (2009: £3.7 million), an uplift of 64%.
§ Invested a record £111 million, largely in the buyout of seven, primarily fast growing, companies: TeamSystem (Italy, £24.4 million); Stepstone (UK, £19.3 million); Frosunda (Nordic region, £14.3 million); JLA (UK, £11.5 million); Manx Telecom (Isle of Man £11.0 million); SimonsVoss (Germany, £10.1 million) and Teufel (Germany, £9.4 million).
§ The Company was chosen, for the sixth consecutive year, as Private Equity Investment Trust of the Year in the 'Investment Week' awards. The citation for the award referred to the Company's outstanding long-term performance and its high standards of governance.
Outlook
§ New investments made in 2010 are on the whole performing in line with the Manager's investment plan showing strong growth year on year.
§ Short term NAV growth will be driven by potential realisation activity from the 2006 vintage fund and continued strong trading performance of the unrealised portfolio.
§ Medium term growth will be driven by the performance of the 2009 vintage fund, a majority of which is valued at cost and growing strongly.
§ Taking a longer term view, it remains the Manager's belief that the provision of capital by a patient and knowledgeable investor, like HgCapital, will continue to be very attractive to both vendors of businesses and the management teams that run them and will continue to be rewarding for the Manager's clients, such as HgCapital Trust.
Roger Mountford, Chairman of the Trust, commented:
"2010 was an active year for HgCapital Trust and one in which we made strong progress towards our strategic goals. Following a quiet year for realisations in 2009, the total value of realisations to the Trust was over £82 million, marking a return to the levels achieved on average over the period 2006-8.
"Shareholder value was further created by a strong increase in the unrealised revaluation of portfolio investments. The Manager's analysis indicates that the largest contributor to this increase was the growth in profits of portfolio companies. Strong cash flows from trading also enabled portfolio companies to reduce net debt.
"The Trust continues to bring together long-term capital and the Manager's talent in identifying good businesses and helping them to create value, to the benefit of individual and institutional investors alike.
"We believe that given the strong performance and growth characteristics of the principal buyout businesses, along with the Manager's vigilance in assessing risk and opportunities, the prospects for the Trust look favourable for the coming year."
- Ends-
For further details:
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HgCapital |
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Ian Armitage (Chairman, HgCapital) |
+44 (0)20 7089 7888 |
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Roger Mountford (Chairman, HgCapital Trust plc)
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+44 (0) 77 99 66 26 01 |
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Neil Bennett Rowan Brown |
+44 (0)20 7379 5151 |
About HgCapital Trust plc
HgCapital Trust plc is an investment trust whose shares are listed on the London Stock Exchange. The Trust gives investors exposure, through a liquid vehicle, to a portfolio of high-growth private companies, managed by HgCapital, an experienced and well-resourced private equity firm with a long-term track record of delivering superior risk-adjusted returns for its investors.
For further details, see www.hgcapitaltrust.com and www.hgcapital.com
Neither the contents of HgCapital's or HgCapital Trust's website nor the contents of any website accessible from hyperlinks on the websites (or any other website) is incorporated into, or forms part of, this announcement.
This information is provided by RNS