Edison issues update on Tetragon Financial Group

Tetragon Financial Group Limited

11 August 2023

 

London, UK, 11 August 2023

Edison issues update on Tetragon Financial Group (TFG)

Tetragon Financial Group (Tetragon) reported a 1.7% ROE in H123 and its NAV increased by 1.7% in total return terms. The portfolio gained 3.0% on the back of TFG Asset Management (which remains Tetragon's largest asset, representing 50% of its NAV), private equity assets and its direct listed equity investments, while the remaining asset classes had a limited impact on NAV. Tetragon targets returns uncorrelated with broader equity markets and a 10-15% ROE (9.9% on average over the last five financial years, and 11.4% pa since IPO). In H123 Tetragon was a net investor and increased its credit facility utilisation to 75% (US$300m), deploying capital predominantly into private equity assets and hedge funds, and further supporting the growth of TFG Asset Management.

As at end H123 Tetragon had US$300m of its US$400m credit facility drawn, translating into net gearing of 9.5% (FY22: 6.1%, FY21: net cash of 0.3%). This compares to US$113m of undrawn commitments as at end-June (likely to be drawn gradually in the coming years), of which roughly half was made to fully controlled managers. In H123 Tetragon distributed US$43.5m in dividends and share repurchases to its shareholders (in line with its four-year semi-annual average of US$43.2m). Tetragon's cash position in H123 was supported by US$119.4m in disposals and distributions, of which US$32.3m came from CLOs and US$9.1m from a dividend paid by Equitix.

  
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