Slide 1: Full year results
Full year results 31 December 2019
Slide 2: Disclaimer
Disclaimer The communication of this presentation may be securities of the Company. Nothing contained in this presentation shall be restricted by law; it is not intended for distribution to, The statements contained in this presentation are deemed to be a profit forecast. This presentation or use by
Slide 3: Contents
Contents 1 Overview 2 Purpose, vision and strategy 3 Results 4 Portfolio 5 Summary © IP GROUP PLC 2020 | 2
Slide 4: Overview: Summary of 2019
Overview Summary of 2019 ▪ Significant headwinds in the year (WIM, Brexit etc) ▪ Continued focus in the UK on portfolio rationalisation and realisations ▪ Hard NAV1 of £1,142m or 108p per share at FY19 (FY18: £1,218m or 115pps) ▪ Record portfolio realisations of £80m, exceeding portfolio investment
Slide 5: Purpose, vision and strategy
02 Purpose, vision and strategy Evolving GREAT IDEAS into WORLD-CHANGING businesses
Slide 6: Context, purpose, vision
Context Purpose Vision Intellectual Financial Human © IP GROUP PLC 2020 | 5
Slide 7: Business units, sectors and countries
Business units Sectors AuM / Portfolio £264m £314m £205m £124m 27% 32% 21% 12% FV £300m Sector focused funds Countries £57m 6% University spinout focused country funds £4m 0% Funds managing balance sheet capital Funds managing 3rd party capital only © IP GROUP PLC 2020 | 6 %s reflect proportion of £
Slide 8: Multi-award winner, tier-one university partners
Multi-award winner Tier-one university partners © IP GROUP PLC 2020 | 7
Slide 9: Impact, ESG and stewardship
Impact, ESG and stewardship IMPACT ESG STEWARDSHIP Impact is a natural driver Offsetting of carbon Data collected from of scientific research emissions portfolio companies on 30% club commitment current ESG standards to set a benchmark for Sustainability & ESG future measurement. Policy Engaged with
Slide 10: Results
03 Results Evolving GREAT IDEAS into WORLD-CHANGING businesses
Slide 11: Results: Hard NAV per share waterfall
Results: Hard NAV per share waterfall 6.0 6.2 115.0 3.0 1.8 0.9 2.1 1.0 107.8 Opening ONT, Life Other net Other net US portfolio Net Other P&L Closing Istesso, sciences quoted private overheads items Ceres technical & portfolio portfolio commercial losses losses setbacks © IP GROUP PLC 2020 | 10
Slide 12: Results: net overheads
Results: net overheads £24m £25m £21m £19m £11m 3.0% Hard £8m synergy savings NAV* Core UK plc Touchstone £14m £13m £13m £10m 1.7% Hard 1.1% Hard NAV* NAV* IP Group Non-recurring TTO £3m costs Non-recurring costs £3m £0m £2m £0m £1m £1m £2m Overseas £4m £5m £4m businesses £3m Indicative Indicative 2
Slide 13: Results: net assets
Results: net assets Portfolio Cash and deposits Other Loan Hard NAV £1.1bn 108pps Other Portfolio £1,128m £1,046m Ceres Istesso ONT 58pps £219m £195m Gross Cash (£32m) (£17m) (£98m) (£83m) FY 2018 FY 2019 © IP GROUP PLC 2020 | 12
Slide 14: Results: cash flows
Results: cash flows 2019 (£m) 2018 (£m) A Operations Core Business (22.2) (25.5) Working capital changes 14.1 7.8 (8.1) (17.7) B Portfolio Investments (64.7) (100.9) Realisations 79.5 29.5 Consolidated portfolio company costs (5.4) (2.6) LPs and other (8.0) (4.6) 1.4 (78.6) Cash flow before financin
Slide 15: Portfolio
04 Portfolio Evolving GREAT IDEAS into WORLD-CHANGING businesses
Slide 16: Portfolio summary
Portfolio summary £4m £27m ONT Top 20 holdings Life Sciences ex. ONT £57m Focus 16% Other £264m Technology £124m Cleantech £994m 12% US £205m 72% Australasia £314m Multi Sector £25.8m 2019 net fair value movements £9.2m £5.3m £0.3m (£1.9m) (£0.1m) (£38.7m) (£43.8m) (£43.9m) (£53.0m) Life Technology
Slide 17: ONT: strong growth continues
ONT: strong growth continues Strong market drivers Analysis of any living thing by anyone anywhere Innovation Strong growth continues $120m+* Booked orders $61m 5 $25m $1m $7m 2015 2016 2017 2018 2019 © IP GROUP PLC 2020 | 16 * 2019 reflects management’s current expectation for booked order intake
Slide 18: Life Sciences Portfolio – Excluding ONT
Life Sciences Portfolio – Excluding ONT £82.6m £(7.1)m £33.6m £24.7m £24.0m £343.4m £18.4m £(55.5)m £14.6m £12.6m £314.3m £2.5m £1.0m £(55.5)m £(10.9)m Opening Invested Realised Fair value Closing £(13.1)m movement Istesso Inivata Ieso Autifony Psioxus 2019 Key Events 2020 Expectation - Financing, p
Slide 19: Technology Portfolio
Technology Portfolio £33.7m £261.1m £12.2m £29.3m £28.8m £(30.0)m 51 £15.2m £13.7m £(38.7)m £9.5m 25 £204.5m Opening Invested Realised Fair value Closing £(10.6)m movement Ultraleap Featurespace Garrison Wave YoYo Wallet Actual Optics Experience 2019 Key Events 2020 Expectation - Sale of PSE, genera
Slide 20: Cleantech Portfolio
Cleantech Portfolio £74.6m £124.3m £27.5m £25.8m 42 £17.9m £7.5m £101.3m £(10.4)m £11.6m £9.8m £3.2m £1.1m £0.5m Opening Invested Realised Fair value Closing Ceres First Light Oxbotica Azuri C-Capture movement Power 2019 Key Events 2020 Expectation - Ceres Power £8m strategic partnership with Doosan
Slide 21: Summary
05 Summary Evolving GREAT IDEAS into WORLD-CHANGING businesses
Slide 22: Summary of 2019 and outlook
Summary Summary of 2019 ▪ Significant headwinds in the year (WIM, Brexit etc) ▪ Continued focus in the UK on portfolio rationalisation and realisations ▪ Hard NAV1 of £1,142m or 108p per share at FY19 (FY18: £1,218m or 115pps) ▪ Record portfolio realisations of £80m, exceeding portfolio investment o
Slide 23: Appendices
Appendices
Slide 24: 1 - Board
1 - Board Sir Douglas Flint Non-executive Chairman Previously Group Chairman of HSBC, spent 15 years as HSBC’s Group Finance Director, joining from KPMG where he was a partner Professor David Begg Alan Aubrey Senior Independent Director Chief Executive Officer Corporate finance background (partner K
Slide 25: 2 - IP Group's history
2 - IP Group’s history Acquisition of Touchstone Innovations 2017 Flotation Main market & Launch of NE Tech IP Venture Fund II 2003 name change Fund 2013 2006 2010 Acquisition of Parkwalk Advisors Acquisition of 2017 Incorporated as Acquires Launch of IP Venture Agreement with stake in Acquisition o
Slide 26: 3 – Top 20 Holdings & fair value movement in FY 2019
3 – Top 20 Holdings & fair value movement in FY 2019 Life Sciences Technology Total £263.8m IPG FV IPG FV IPG % of Category No No No (£m) (£m) FV(£m) total Top 20 10 463.5 9 232.8 19 696.3 70.0% £82.6m Multi-sector 1 23.9 2.4% £74.6m platforms Total 20 720.2 72.4% Total % 46.6% 23.4% Key Life Scienc
Slide 27: 4 – Shareholder register
4 – Shareholder register Shareholder % holding Invesco 16.5% RPMI Railpen 15.3% Lansdowne Partners 10.4% Imperial College 5.2% Baillie Gifford 4.5% Lombard Odier 2.7% TelstraSuper 2.5% SocGen 2.5% Legal & General Investment Management 2.4% BlackRock 2.2% Total 64.3% As at 29 Feb 2020 © IP GROUP PLC
Slide 28: 5 – Summary income statement
5 – Summary income statement 2019 (£m) 2018 (£m) A Core business Movement in portfolio value including funds (44.6) (46.1) Income 8.6 9.9 Overhead (incl. incentives) (31.2) (35.9) Net operating costs (22.6) (26.0) Incentive costs (non-cash) (1.0) (0.8) Consolidated portfolio company costs (5.4) (2.6
Slide 29: 6 – Portfolio valuation approach
6 – Portfolio valuation approach FY 2019 FY 2018 Quoted 2% 11% 3% 12% 9% 20% Recent financing (<12 months) Recent financing 18% (>12 months) Other valuation methods 23% 44% Debt 58% • Group seeks to use observable market data as the primary basis for determining asset fair values where possible (bid
Slide 30: EIB debt repayment profile
7 – EIB debt repayment profile 18.0 90.0 16.0 80.0 14.0 70.0 Debt repayments per annum 6.3 6.3 6.3 6.3 6.3 12.0 60.0 Debt facility 10.0 50.0 8.0 40.0 3.2 3.2 3.2 3.2 3.2 6.3 6.0 30.0 6.3 4.0 20.0 6.0 6.0 6.0 6.0 6.0 2.0 10.0 3.2 3.1 1.8 0.0 0.0 2019 2020 2021 2022 2023 2024 2025 2026 IP Group Facili
Slide 31: 8 – Portfolio Reconciliation; Net & Gross
8 – Portfolio Reconciliation; Net & Gross Number IPG FV (£m) ONT 1 263.8 Life sciences exc. ONT 41 314.3 Technology 41 204.5 Cleantech 16 124.3 Multisector 2 26.7 Total UK 101 933.6 US 23 57.1 Australasia 8 3.7 Net portfolio 994.4 De minimis & organic 13.0 Attributable to third parties/revenue share
Slide 32: 9 – News from the top ten companies
9 – News from the top ten companies Company Group fair value/ Recent news flow shareholding • Involvement of technology in genomic surveillance of coronavirus, ships 200 MinION sequencers to China. • Appoints John O’Higgins (fomer CEO of Spectris) as NED £263.8m • Raises aggregate investment of £109
Slide 33: 10 – News from the top ten companies (cont.)
10 – News from the top ten companies (cont.) Company Group fair value/ Recent news flow shareholding • Ultraleap technology integrated in systems by Varjo Technologies (industrial VR) and Pimax (consumer VR) • Joins The Khronos Group, an open consortium of leading hardware and software companies £27
Slide 34: Evolving great ideas into world-changing businesses
EVOLVING GREAT IDEAS INTO WORLD-CHANGING BUSINESSES. The Walbrook Building 25 Walbrook IP Group was set up with a mission to evolve great ideas, mainly from our partner universities, into London EC4N 8AF world-changing businesses. We achieve this by systematically helping to create, build and suppor