• The Trust aims to provide shareholders with long-term capital growth through investment in unquoted companies both directly and through private equity funds.
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Key facts

  • Graphite Enterprise Trust plc changed name to ICG Enterprise Trust plc on 1 February 2016. This follows Intermediate Capital Group's (ICG) acquisition of the private equity fund investment business of Graphite Capital Management LLP who were the managers of Graphite Enterprise Trust. 

    There is no change to the investment objectives or dividend policy of the trust.

    Further details can be found on the announcements from both ICG and Graphite Capital on the right hand side  of this page.

    Key points

    • ICG Enterprise Trust plc provides access to a diverse portfolio of mature companies, mainly in established European private equity markets with more than 350 underlying companies.
    • ICG, the manager, is a UK headquartered specialist asset manager in private debt, credit and equity. It currently manages €20bn of assets including its own balance sheet of £2.3bn. ICG’s 270 employees, including 120 investment professionals, operate from 12 offices in 11 countries covering Europe, USA and Asia.
    Trust facts
    Investment manager ICG
    Benchmark FTSE All-Share Index
    Sector Private Equity
    Launch date 1981
    Total equity £521 million (as at 31.01.16)
    Currency Sterling
    ISIN GB0003292009
    SEDOL 0329200

     

    Key dates
    Annual general meeting June
    Year end 31 January
    Dividend payment date(s) June
    Ex-dividend date(s) June

     

    Trust commentary

    Unaudited results for the six months ended 31 July 2016

    ICG Enterprise Trust plc (“ICG Enterprise” or “the Company”) presents its unaudited results for the six months ended 31 July 2016.

     

    Chairman's Statement

     Interim review

    “The portfolio continues to generate strong growth over the short, medium and long term.”
     
     
    On behalf of the Company, I am able to report a successful set of results for the first six months under the management of ICG1. The net asset value as at 31 July 2016 is £566 million or 798 pence per share (31 January 2016: 731p), a 10.0% Total Return2 for the period. The share price also recovered to 592 pence at 31 July 2016 (31 January 2016: 545p), delivering a Total Return of 9.8% in the six months (year ended 31 January 2016: 8.2%).

     

    We are pleased to announce an interim ordinary dividend of 10.0 pence per share, a 100% increase on the 5.0 pence per share interim dividend declared in 2015. This will be paid on 21 October 20163.

    Performance in years to 31 July 2016

    Performance in years to 31 July 2016 1 3 5 10*
    Net asset value per share Total Return 15.6% 24.1% 48.3% 115.6%
    Share price Total Return 2.3% 29.9 65.9% 89.3%
    FTSE All-Share Index Total Return 3.8% 15.5% 44.1% 75.6%
    * As the Company changed its year end in 2010, the ten year figures are for the 121 month period to 31 July 2016.

     

    Profit for the period was £51 million, equivalent to 72 pence per share, driven both by strong growth in the Portfolio2,4 (+7.4%) and favourable movements in the foreign exchange rate (+5.3%). The integration of the investment team into ICG has gone smoothly and they have begun to take advantage of being part of a much larger alternative asset management business. In particular the Company has benefited from ICG’s broader insight into and access of private market investment opportunities to inform certain investment decisions and make new investments. Since the start of the financial year the Company has made two primary fund commitments and two secondary investments in opportunities all originated through ICG, as well as four third-party primary fund commitments.

    Portfolio

    The Portfolio now stands at £470 million with the Company having received Realisation Proceeds2 of £45 million and invested £30 million in the period. Primary fund investments account for £287 million (61%) and secondary and co-investments £183 million (39%). ICG originated investments represent £40 million (8%). 44% of the Portfolio is invested in the UK, 38% in continental Europe and 18% in North America.

    Post-crisis Investments2 now comprise 80% of the Portfolio with the 30 largest investments accounting for 48% of the Portfolio. The valuation of the top 30 investments at 9.7 times EBITDA2 is at a substantial discount to the valuation of FTSE All-Share Index at 14.0 times EBITDA.

    Balance sheet

    Commitments of £54 million were added in the period such that Undrawn Commitments2 now stand at £297 million. The Company holds cash of £110 million and undrawn debt facilities of £102 million providing total available liquidity of £212 million. Commitments therefore exceed total liquidity by £84 million or 15% of the period end net asset value; a level that remains consistent with our cautious approach to managing the balance sheet.

    Distributions

    In the period the Company paid a final dividend of £4.3 million for the year to 31 January 2016, equivalent to 6.0 pence per share. In order to provide shareholders with greater clarity of the income they can expect from the Company, the Board anticipates paying a minimum dividend each year of 20.0 pence per share. We intend to maintain the practice of paying an interim dividend and we are pleased to declare an interim ordinary dividend of 10.0 pence per share to be paid on 21 October 20163.
     
    We repurchased 458,426 shares at an average price of 574p for total consideration of £2.6 million. This improved the net asset value per share by 0.2%. So long as the shares are valued at a significant discount to the net asset value the Board believes that the shares offer good value and will continue to repurchase shares on an opportunistic basis.

     Outlook

    We are encouraged to see the Portfolio maintaining its positive growth momentum of the last 7 years, delivering double digit EBITDA growth in the last 12 months and yet it is still valued at a material discount to the FTSE All Share Index. Our focus on partnering with only the most experienced managers, with strong track records of investing and managing companies through economic cycles provides us with reassurance that the Portfolio is well positioned to adapt to changing market conditions. Whilst the stock market’s response to the recent Brexit decision has been positive, we acknowledge that the negotiations with the EU may present some medium term uncertainty for the UK. We remain confident that the risk profile of the underlying investments is low, the diversity of investments is high and the liquidity position of the balance sheet is strong. In fact, the Company is well positioned to take advantage of future investment opportunities that invariably arise at times of market instability. Finally, the change of Manager to ICG is already delivering material benefits to shareholders which should only increase in both the short and long term.

    Mark Fane

    27 September 

    1 ICG Alternative Investment Limited, a regulated subsidiary of Intermediate Capital Group plc, acts as the Manager of the Company.

    2 Constitutes an Alternative Performance Measure (“APM”). APMs are used throughout this report if considered by the Board and the Manager to be the most relevant basis for shareholders in assessing the overall performance of the Company, and for comparing the performance of the Company to its peers and its previously reported results. The Glossary, which is located after the notes to the financial statements, includes further details of APMs and reconciliations to IFRS measures, where appropriate.

    3 Shares will trade without rights to the interim dividend from 6 October 2016 (“ex-dividend date”). The last date for registering transfers to receive the dividend is 7 October 2016 (“record date”).
     

    4 In the Chairman’s Statement, Manager’s Review and Supplementary Information, reference is made to the “Portfolio”. This is an APM (see footnote 2). The Portfolio is defined as the aggregate of the investment portfolios of the Company and of its subsidiary limited partnerships. The rationale for this APM is discussed in detail in the Manager’s Review. The Glossary, which is located after the notes to the financial statements, includes a reconciliation of the Portfolio to the most relevant IFRS measure.

  • The value of shares and the income from them is not guaranteed and can fall as well as rise due to stock market movements. Past performance is not a guide to future performance. When you sell your shares, you might get back less than you originally invested. If markets fall, gearing can magnify the negative impact on performance. Changes in rates of exchange may have an adverse effect on the value, price or income of investments. Emerging Markets, Unquoted Companies and Smaller companies carry a higher degree of risk and their value can be more sensitive to market movement; their shares may be less liquid and performance may be more volatile. The trust may invest in hedge funds or private equity funds which are not normally available to individual investors, exposing the trust to the performance, liquidity and valuation issues of these funds. Such funds typically have high minimum investment levels and may restrict or suspend redemptions or repayment to investors. The asset value of these shares and its prospects may be more difficult to assess.
  • share price

    635.00p

    01 October 2016

Past performance is not a guide to future results. The value of investments can go down as well as up.

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