Mercia Asset Management Plc · LSE:MERC
Mercia Asset Management — FY2017 Earnings Presentation
25 slides from Mercia Asset Management's earnings presentation, Jul 4, 2017
Slide 1: Preliminary Results Year Ended 31 March 2017
Mark Payton, CEO Preliminary Results Year Ended 31 March 2017 Martin Glanfield, CFO Preliminary Results Year EndedMatt 31 March Mead,2017 CIO
Slide 2: Important Notice
Important Notice This document has been prepared by and is the sole responsibility of Mercia Technologies (the “Company”), comprises these presentation slides for the sole use at a presentation and any question and answer session and any document or material distributed at or in connection with the
Slide 3: Highlights
Highlights • Positive progress in direct investment portfolio: - £11.7million invested in 15 portfolio companies, with four new Emerging Stars - Net fair value gains of £4.3million (2016: £0.9million) - Sale of Allinea Software to ARM (December 2016) - IPO of Concepta (July 2016) - Fair value increa
Slide 4: Mercia Overview
Mercia Overview Infrastructure in place to become a leading national technology investor • Extensive networks • <5% of managed fund • £336.5million managed • Market sentiment • 18 university partnerships portfolio to balance funds • 8 regional offices sheet • £150.0million in available • 1,000+ enqu
Slide 5: Complete Capital Solution
Complete Capital Solution More than £150.0m 5
Slide 6: Focused Portfolio Composition
Focused Digital & Digital Entertainment Life Sciences & Biosciences • Virtual reality • Diagnostics • Augmented reality • Digital health • Mixed reality • Medical devices Portfolio Composition • Serious games Electronics, Materials & Software & the Internet Manufacturing/Engineering • Artificial int
Slide 7: Allinea Software Limited – Cash Exit Case Study
Allinea Software Limited – Cash Exit Case Study 16.6% equity stake – holding value £1.9m* Fund investment - Jul ‘09, Mtech investment - Dec ‘14 From seed to success… • • Software for designing, optimising and debugging HPC applications Global customer base in big data applications, potential move in
Slide 8: Portfolio
UNIWERSIIV® BY Sez BIRMINGHAM Ef Portfolio
Slide 9: The Mercia Model
The Mercia Model 150 investments spread Over 1,000 approaches across the UK regions with Several rounds of Direct investments 4-6 new Emerging Stars Strong focus on exits for investment 40-60 new investments seed/early stage approved by Board per year per year investment 9
Slide 10: Digital & Digital Entertainment - nDreams
Digital & Digital Entertainment - nDreams 47.0% equity stake £11.0million holding value Background • Developer and publisher of virtual reality games and content • Multiple revenue streams – own IP, paid Investment Director Mike Hayes – Sector Head development plus third party co-development • 200,0
Slide 11: Software & the Internet - Intelligent Positioning
Software & the Internet - Intelligent Positioning 26.7% equity stake £2.5million holding value Background • Real time search intelligence and analytics platform • Extensive data analytics provides customers with a leading and powerful software platform Investment Director Rob Johnson – Sector Head •
Slide 12: Electronics, Materials & Manufacturing - Impression Technologies
Electronics, Materials & Manufacturing/ Engineering - Impression Technologies 18.2% equity stake £1.5million holding value Background • Develop complex high-strength lightweight components for the transportation industry • Proprietary Hot Forming Quench technology - HFQ® Investment Director Mark Vol
Slide 13: Life Sciences & Biosciences - Oxford Genetics
Life Sciences & Biosciences - Oxford Genetics 47.9% equity stake £2.2million holding value Background • Synthetic biology through to protein production specialists • Strong management team includes: Investment Director Peter Dines – Sector Head • Dr Ryan Cawood, CEO, experienced genetic engineer 20+
Slide 14: Balance Sheet Portfolio
Balance Sheet Portfolio 14
Slide 15: 2016/17 Financials
UNIVERSIT® IY Se ~ BIRMINGHAM 2016/17 Financials
Slide 16: Summary Financial Information
Summary Financial Information Year to Year to 31 March 2017 31 March 2016 £’000 £’000 Key revenue and expenditure items Revenue 6,660 1,755 Fair value movements in investments 4,268 896 Realised gains on disposal of investments 839 - Administrative expenses (9,051) (4,011) Exceptional items (1,125)
Slide 17: Direct Investment Holdings: Year Ended 31 March 2017
Direct Investment Holdings: Year Ended 31 March 2017 Net investment Net cash Investment Fair value Net investment Percentage value invested realisations movement value held As at Year to Year to Year to As at As at 1 April 2016 31 March 2017 31 March 2017 31 March 2017 31 March 2017 31 March 2017 In
Slide 18: Valuation Policy and Portfolio Summary
Valuation Policy and Portfolio Summary • All £52.0million of investments are held at fair values based on IPEVCV Guidelines • Early stage companies often have no current/short-term future Valuation Analysis earnings or positive cash flows • Consequently, the most appropriate fair value methodology i
Slide 19: Movements in Net Assets: Year Ended 31 March 2017
Movements in Net Assets: Year Ended 31 March 2017 £32.9m £(5.2)m £(0.2)m £121.4m Net assets as at 1 April 2016 Portfolio value increase Increase in cash and £13.9m short-term liquidity investments £80.0m Increase in current liabilities Other net asset movements Net assets as at 31 March 2017 19
Slide 20: Strategy for Growth and Shareholder Returns
Strategy for Growth and Shareholder Returns NAV growth Minimisation of Leverage Realise value Strong focus on the NAV erosion partnerships Through trade sales accelerated growth in Revenue growth from Build and nurture and IPOs, leading to the value of direct £1.8million to £6.7million managed funds
Slide 21: In Conclusion
In Conclusion “Mercia is aggressively executing against its strategic plan to build a sustainable platform with the potential to deliver significant value for shareholders. The tangible early signs of success are reflected in these results” 21
Slide 22: Appendix
UNIVERSITY: IY Sez BIRMINGHAM PE Appendix
Slide 23: The Board
The Board Dr Mark Payton Martin Glanfield Matthew Mead Jonathan Diggines Susan Searle Ian Metcalfe Ray Chamberlain Martin Lamb CEO CFO CIO Third party funds Non-executive Snr Independent Non-executive Non-executive Chair Director Director Director • Over 15 years’ • Over 20 years’ • Over 20 years’ •
Slide 24: University partnerships
University partnerships Midlands The North Scotland Partnerships delivering innovative opportunities 24
Slide 25: Progress Since IPO (Dec 2014)
Progress Since IPO (Dec 2014) Complementary acquisition 22 February 2017 • Consideration of up to • £108.5million fund £11.0m mandate win • Enlarged pipeline of • Managing two of the Emerging Stars 26 July 2016 16 December 2016 British Business Bank’s • 4 new offices in the North • Concepta floats o
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