Annual Financial Statements December 2022

Marwyn Value Investors Limited

28 April 2023

 

LEI: 213800L5751QTTVEA774

THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED HEREIN IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN PART, DIRECTLY OR INDIRECTLY, IN OR INTO THE UNITED STATES, AUSTRALIA, CANADA, THE REPUBLIC OF SOUTH AFRICA, JAPAN, ANY MEMBER STATE OF THE EUROPEAN ECONOMIC AREA OR ANY JURISDICTION IN WHICH IT WOULD BE UNLAWFUL TO DO SO

28 April 2023

MARWYN VALUE INVESTORS LIMITED (THE "COMPANY")

Annual Report and Financial Statements 2022

Marwyn Value Investors Limited announces the publication of its annual results for the year ended 31 December 2022.

The Annual Report and Financial Statements are available on the 'Financial Reports' section of the Company's website, http://www.marwynvalue.com/company-information/financial-reports, and will be uploaded to, and available on, the National Storage Mechanism.

SUMMARY PERFORMANCE

Ordinary Shares

	NAV Total Return1	FTSE All-Share
Year to 31 December 2022	1.5%	0.3%
Since inception (1 March 2006 to 31 December 2022)	183.0%	149.9%

Net assets of £98.1 million, a decrease of £3.8 million since 31 December 2021, with £5.0 million paid out in dividends

·   NAV per share of 176.8p as at 31 December 2022.

·   Total NAV return of 1.5% since 31 December 2021.

·   Share price down 24.0p since 31 December 2021 to 95p as at 31 December 2022. The share price discount to NAV increased to 46.3% as at 31 December 2022, compared to 35.2% as at 31 December 2021.

Continued significant distributions

·   Quarterly dividends of 2.265p per share paid in February, May, August and November 2022 with a further quarterly dividend of 2.265p expected to be paid in each quarter of 2023. Total annual dividend of 9.06p per share represents a yield of over 9.7% (based on share price of 92.5p as at 31 March 2023).

Strong cash position

·   Look-through cash balance of £44.4 million at 31 December 2022 held within the fund structure, supplemented by significant capital available for investment within the portfolio entities.

2016 Realisation Shares

	Shareholder Total Return2	FTSE All-Share
Year to 31 December 2022	31.5%	0.3%
Since inception (30 November 2016 to 31 December 2022)	3.7%	37.2%

Net assets of £3.5 million, an increase of £0.8 million since 31 December 2021

·   NAV per share of 376.0p as at 31 December 2022.

2021 Realisation Shares

	Shareholder Total Return2	FTSE All-Share
Year to 31 December 2022	0.8%	0.3%
Since inception (30 November 2021 to 31 December 2022)	4.2%	5.0%

Net assets of £668 thousand, an increase of £6 thousand since 31 December 2021

·   NAV per share of 185.3p as at 31 December 2022.

Manager's Review of 2022 and Outlook for 2023

In 2022, we delivered a modest positive NAV performance for ordinary shareholders of 1.5% amidst a difficult market environment, with the average UK small-cap declining by 22%. Our significant cash position will now allow us to capitalise on falling valuation multiples and tightening credit conditions.

These market conditions are revealing the weaknesses in leveraged investment models, which we have consciously avoided, and are creating special situations that present attractive entry prices. With continued outflows from UK active equity funds, our focus remains on opportunities where we can act as the principal investor and funding source.

Our investee companies, such as AdvancedAdvT led by Vin Murria OBE, have demonstrated agility and discipline in their investment activities. Although the offer for M&C Saatchi did not proceed, the financial impact on AdvancedAdvT was minimal. With over £100 million in cash, a strong roster of institutional investors, and a significant decline in technology valuations, we believe AdvancedAdvT is well-positioned for 2023 under Vin's leadership.

Le Chameau, our premium footwear business led by Corry Taylor, has made significant strides since 2019, overcoming global shipping and supply chain disruptions as well as a post-Covid slowdown in demand. With a focus on expanding its direct-to-consumer online business and increasing its addressable customer base, Le Chameau aims to capitalise on the long-term growth prospects of the premium outdoor market. However, the company will proceed cautiously in the current market environment and prioritise consolidating its achievements to date.

During 2022, we also announced new management partnerships with Mark Hodges through Marwyn Acquisition Company II Limited and Waheed Alli through 450 plc (previously Marwyn Acquisition Company plc). Mark Hodges brings a wealth of experience from leadership roles at Centrica, Aviva, and Reassure and will focus on the pensions and wealth management space. Waheed Alli has an exceptional background in media and entertainment, with successful ventures such as Planet 24, Shine, and Silvergate Media to his credit. We are excited about the opportunities to acquire proven entertainment properties and intellectual property that can be exploited in new ways and through new channels.

In terms of prior investments, we were pleased to recognise the £10 million VAT claim from our previous investment in Praesepe, with the final £5 million cash receipt expected later this year.

We are deeply grateful for the support we have had in 2022 from our investors and the Board. We expect 2023 to be a very active year, we believe we have a fantastic group of management partners, and, as we found in the years following the financial crisis, we believe it is in these types of investing environments where our investment strategy comes to the fore.

Robert Ware, Chairman of Marwyn Value Investors Limited, commented:

"Despite the challenges of 2022, the Board acknowledges the Manager's persistent efforts to identify and collaborate with leading Management Partners, resulting in the appointment of Mark Hodges to MAC II and Waheed Alli to 450 plc. Their extensive experience and deep sector knowledge equip their respective acquisition vehicles with exceptional leadership and expertise, allowing them to continue pursuing their stated investment strategies.

The acquisition vehicles have exercised patience in identifying and executing platform deals, evaluating a significant number of opportunities. With the Fund maintaining its cash resources during these uncertain times, it is well-positioned to support the acquisition vehicles as they progress with their stated investment strategies throughout 2023 and beyond.

With the additional Management Partner appointments and considering the current level of opportunities we are seeing across the sectors that are the focus of our current acquisition vehicles' investment strategies, I believe that with the support of the Manager and our cash resources, the Company is well-positioned to capitalise on opportunities that will lay the groundwork for robust portfolio performance in the coming years."

¹ For the ordinary shares, inception to date movement is based on the combined weighted average NAV of Marwyn Value Investors I, II and B shares prior to their amalgamation, using the conversion ratio published on 17 April 2008.

Total return assumes the reinvestment of dividends paid to shareholders into the Company at NAV and is calculated on a cum-income basis.

² For the realisation shares, shareholder total return is calculated as the movement in total shareholder value, including all distributions made to realisation shareholders over the relevant period.

Capitalised terms used in the announcement and not otherwise defined have the same meaning as detailed in the Company's Annual Report and Audited Financial Statements for the year ended 31 December 2022.

Company enquiries:

Company Secretary - Aztec Financial Services (Jersey) Limited

Magdala Mullegadoo / Chris Copperwaite

Telephone: [phone]

Investor Relations - Kam Bansil

Telephone: [phone]

Corporate Broker:

Chris Clarke / Owen Matthews

Liberum Capital Limited

Telephone: [phone]

Marwyn Value Investors Limited is a closed-ended investment company, trading on the London Stock Exchange Specialist Fund Segment - a fully regulated market for professional, institutional and sophisticated investors. Current investments through its underlying funds include AdvancedAdvT Limited, the operating business of Le Chameau, 450 plc, Marwyn Acquisition Company II Limited, Marwyn Acquisition Company III Limited, MAC Alpha Limited and Zegona Communications plc.

Cautionary Statement

This announcement includes statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "expects", "believes", "estimates", "envisages", "plans", "anticipates", "targets", "aims", "continues", "expects", "intends", "hopes", "may", "will", "would", "could" or "should" or, in each case, their negative or other variations or comparable terminology. These forward-looking statements include matters that are not facts. By their nature, forward-looking statements involve risk and uncertainty because they relate to future events and circumstances. A number of factors could cause actual results and developments to differ materially from those expressed or implied by the forward-looking statements. Forward-looking statements contained in this announcement based on past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Subject to any requirement under the Listing Rules, Prospectus Rules, the Disclosure Guidance and Transparency Rules or other applicable legislation or regulation, the Company does not undertake any obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Investors should not place undue reliance on forward-looking statements, which speak only as of the date of this announcement.

 

END