Icg Enterprise Trust Plc Gbp · LSE:ICGT
Icg Enterprise Trust Plc Gbp — ICG Enterprise Trust — FY2017 Earnings Presentation
36 slides from Icg Enterprise Trust Plc Gbp's earnings presentation, April 2017
Slide 1: Annual results presentation
Annual results presentation For the year ended 31 January 2017
Slide 2: Annual results presentation
Annual results presentation April 2017 Pages Emma Osborne Head of Private Equity Fund Company overview 4-6 Investments Annual results 7-20 Kane Bayliss Case studies 21-25 Managing Director Private Equity Fund Investments Appendices 26 Mark Crowther Managing Director Investor Relations
Slide 3: Company Overview
Company Overview iCG
Slide 4: ICG is the Manager of ICG Enterprise Trust
ICG is the Manager of ICG Enterprise Trust A specialist asset manager in private debt, credit and equity 28 €22.6 274 14 London Paris Stockholm Amsterdam Warsaw New York Frankfurt 13 Madrid Luxembourg 83 investment Tokyo 26 investment professionals Hong Kong 15 investment professionals professionals
Slide 5: Company overview
Company overview > Our aim is to generate consistently high returns while protecting the investment downside > We seek to achieve this by investing in companies managed by ICG directly as well as by selected top-tier private equity managers > The local access and insights of ICG’s direct investment
Slide 6: Investment strategy
Investment strategy Highly selective approach balancing risks and returns Profitable Buyouts of profitable, cash generative companies with tangible performance and valuation metrics Not start-ups, development capital, turnaround, distressed or other higher risk PE strategies companies Developed Targ
Slide 7: Annual results
Annual results For the year to 31 January 2017 7
Slide 8: Highlights for the year ended 31 January 2017
Highlights for the year ended 31 January 2017 An excellent first year under ICG management +23.4% +31.6% +21.8% NAV Share Price Underlying Total Return Total Return Portfolio Return in local currencies NAV and Share Price total return outperformed the benchmark FTSE All-Share Index total return of +
Slide 9: Return attribution
Return attribution Consistently strong portfolio growth Change in NAV 5 year cagr portfolio growth 15.1% Jan-17 (% of opening NAV) – 14.6% excluding currency impact Underlying portfolio return in local currencies 21.8% 30.0% 28.9% Currency 7.1% 25.0% 7.1% Total portfolio valuation movement 28.9% 20.
Slide 10: Relative performance
Relative performance Outperforming over the short, medium and long term NAV performance* Share price performance* +119.4% +115.2% 10 years 93.1% 10 years 83.0% +71.2% +71.2% +66.9% +118.3% 5 years 52.5% 5 years 96.8% +57.0% Company +57.0% Peer group +38.1% +35.1% 3 years 30.2% Index 3 years 37.0% +2
Slide 11: Investment activity
Investment activity Realisations continuing to generate strong valuation uplifts Realisations 150 142 Number of full exits stable at 40 100 118 120 112 93 Continued strong uplifts on exit +24% * 85 74 50 Return of original cost of 1.9x 26 21 14 0 (24) (54) (50) (78) (64) New investments (85) (81) (9
Slide 12: ICG Impact
ICG Impact Delivering benefits in all areas of opportunity Access Insights Support New in-house fund commitments ICG’s knowledge of the PE A range of specialists are providing - ICG Strategic Secondaries II landscape is informing input into the management of the - ICG Asia Pacific Mezzanine III - ma
Slide 13: Balance sheet
Balance sheet Investment level increased from 80% to 94% Cash has been a significant drag on portfolio performance for many years − An average of 2.2% per annum over the last 5 years We are aiming to be fully invested, but not geared (other than for short term working capital) Cash as % of total ass
Slide 14: Portfolio overview
Portfolio overview Balancing high conviction and diversification 10.1% High Conviction Third-party High conviction portfolio co-investments 21.8% 42% enhances returns Secondary 10.3% investments Diversified portfolio mitigates risk Graphite 13.5% primary funds Diversified portfolio Third-party prima
Slide 15: Top underlying companies
Top 30 underlying companies Consistently strong growth for a lower valuation than the Index EBITDA growth +14% Valued at 9.7x EBITDA 14.0x 40.0% 12.0x 10.0x 30.0% 8.0x 20.0% 6.0x 4.0x 10.0% 2.0x 0.0% 0.0x 2008 2009 2010 2011 2012 2013 2014 2015 2016 (10.0%) Top 30 FTSE All Share (20.0%) 2008 2009 20
Slide 16: Top underlying companies
Top 30 underlying companies Value is concentrated in our high conviction investments Pre-Crisis 2009 - 2012 2013 - 2015 2016 High Conviction 76%1 Graphite primary 15% Third-party primary 8% 1 Percentages are of the top 30 value. High conviction includes ICG, direct co-investments and secondary funds
Slide 17: Strategic priorities
Strategic priorities Evolution of strategy under ICG management Reduce cash drag Increase high conviction Broaden geographic investments exposure The Company has been Direct co-investments and Low exposure to US which under-invested for many secondaries have has outperformed Europe for years signifi
Slide 18: Dividends and buybacks
Dividends and buybacks Continuing to return capital to shareholders Dividends Share buybacks The Board intends to pay a minimum dividend £6.2m share buy backs in FY17 each year of 20.0p per share – 982,345 shares at an average price of 627.0p – Estimated average discount of 20.8% Increase of 81% on
Slide 19: Discount
Discount Sector discount does not reflect the long term performance Company vs sector long term discount Company NAV vs FTSE All Share 10 900.00 800.00 - 700.00 -10 600.00 -20 500.00 -30 400.00 -40 300.00 -50 200.00 -60 100.00 -70 - Sector discount ICG Enterprise discount ICG Enterprise NAV FTSE All
Slide 20: Outlook
Outlook ICG Enterprise Trust is well positioned for future growth Change of manager The move to ICG is delivering results High conviction strategy Focused and flexible strategy, balancing risks and returns Strong profit growth LTM EBITDA growth +14% Sensible valuations LTM EBITDA multiple 9.7x Compe
Slide 21: Case Studies
Case Studies iCG
Slide 22: Direct co-investment: System One (TH Lee)
Direct co-investment: System One (TH Lee) Increasing conviction in our direct co-investment decisions Global market leader in the development Provider of skilled temporary staff and manufacture of air conditioning and primarily to the engineering, IT, heating systems for buses clinical and legal sec
Slide 23: Direct co-investment: Roompot (PAI Partners)
Direct co-investment: Roompot (PAI Partners) Long term relationships facilitate co-investment opportunities 2005 2007 2013 2014 2016 • First • Committed • £3m direct • Invested in investment in to PAI co-investment PAI Fund VI a PAI fund Fund V in Froneri • Acquired a • Co-invested • At Jan -17 seco
Slide 24: ICG Strategic Secondaries
ICG Strategic Secondaries Highly differentiated approach in a growing market segment Acquiring portfolios of PE-backed companies in end of life funds Niche Offering liquidity for existing investors strategy Remaining companies require further time to realise potential value Strong Significant target
Slide 25: ICG European Mezzanine and Equity
ICG European Mezzanine and Equity Flexible strategy aiming for PE returns with low downside risk Aiming for private equity returns with subordinated debt risk profile Objective European mid-market focus, local off-market sourcing Investing across the capital structure Financing of mid-market buyout
Slide 26: Appendices
Appendices iCG
Slide 27: Team biographies
Team biographies Unique combination of direct and fund investment experience IC member IC member IC member IC member Emma Osborne Benoit Durteste Andrew Hawkins Kane Bayliss Fiona Bell Colm Walsh Kelly Tyne Amalia Formoso Head of Private Head of Head of Managing Principal Principal Associate Associa
Slide 28: Realisations
Realisations Realisation uplifts and returns In the year ended January 2017 Valuation uplift on realisation Return multiple of original cost 45% 3.0x 40% 38% 2.7x 35% 2.5x 30% 1.9x 2.0x 24% 25% 1.4x 1.5x 20% 15% 1.0x 9% 10% 0.5x 5% 0% 0.0x 200 8 a nd earlier 200 9 a nd late r Overall 200 8 a nd earl
Slide 29: New investments
New investments New investment history £ million 140 50% 45% 120 34 40% 100 9 35% 57 15 16 30% 80 19 3 79 9 36 14 25% 30 60 14 65 23 64 20% 5 18 7 18 52 10 5 15% 40 44 45 39 41 37 10% 3 20 3 5% 18 0 0% Dec-07 Dec-08 Dec-09 Jan-11 Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Fund drawdowns ICG fund draw
Slide 30: Portfolio bridge
Portfolio Portfolio bridge Portfolio Bridge 2016 /2017 800.0 700.0 30.3 93.5 600.0 94.3 33.5 85.5 594.3 500.0 400.0 428.2 300.0 200.0 100.0 - Portfolio at Primary Secondaries Underlying Currency Realisations - at Portfolio 31.01.16 Investments and Co- Valuation 31.01.17 Investments 30
Slide 31: Top investments
Portfolio Top 15 investments Year of Value as a % Company Manager Country investment of Portfolio 1 Micheldever +^* Distributor and retailer of tyres Graphite Capital 2006 UK 6.30% 2 City & County Healthcare Group Provider of home care services Graphite Capital 2013 UK 2.70% 3 Froneri +^ Manufacture
Slide 32: Portfolio diversification
Portfolio Portfolio diversification Sector Geography Business services UK 40.4% 19.1% Healthcare and education North America 21.1% 17.7% Consumer goods and Germany 10.8% services 16.1% Industrials France 9.0% 14.1% Leisure 11.5% Benelux 5.6% Automotive supplies 8.5% Scandinavia 5.4% Financials 5.3%
Slide 33: Portfolio split by vintage
Portfolio Portfolio split by vintage 100% 6% 90% 23% 10% 80% 34% 45% 70% 60% 69% 60% 50% 40% 83% 77% 30% 66% 55% 20% 40% 31% 10% 0% Jan-12 Jan-13 Jan-14 Jan-15 Jan-16 Jan-17 Post-crisis Pre-crisis Micheldever Pre-crisis investments make up 16% of the January portfolio of which 6% relates to Michelde
Slide 34: Useful information
Useful information Structure: Company registered in England and Wales Ticker: ICGT.LON Investment trust tax status ISIN: GB0003292009 Registered company number: 01571089 SEDOL: 0329200 Listing: Premium London listing Website: www.icg-enterprise.co.uk Broker: Numis Securities Limited James Glass (Sal
Slide 35: Legal notice
Legal notice What this document is for This document has been prepared by ICG Alternative Investment Limited (“ICG AIL”) as manager of ICG Enterprise Trust plc (“ICG Enterprise”). The information and any views contained in this document are provided for general information only. It is not intended t
Slide 36: ICG Enterprise Trust
iCG ENTERPRISE TRUST iCG