Our Portfolio

Analysis

The portfolio, valued at £601m at 31 January 2018, is well-diversified, with investments in over 500 companies.

Focus on mid-market companies

Our strategy is focused exclusively on the buyout segment of the private equity market, in which target companies are almost invariably established, profitable and cash generative. The portfolio is biased towards the mid-market (48%) and large deals (43%), which we view as more defensive, benefiting from experienced management teams and often leading market positions. In contrast, we view small companies as tending to be more vulnerable to economic cycles and we believe our focus on mid-market and larger deals offers the best balance of risk and reward.

Portfolio by investment type %

Mid-market buyout companies 48
Large buyouts 43
Small buyouts 8
Other 1

Exposure to US increasing

The portfolio is focused on developed private equity markets: primarily continental Europe (40%), the UK and the US, with almost no emerging markets exposure. In line with one of our strategic objectives, our weighting to the US increased to 22% from 14% at the time of the move to ICG two years ago while the UK bias has reduced to 35% from 45% over the same period. We expect both of these trends to gather pace as the benefits of being part of ICG’s global alternative asset manager platform are further realised. We have a three to five year target to increase the US focus to 30% – 40% of the Portfolio. The US is the largest and most developed private equity market in the world, and we believe will provide the Portfolio with attractive returns and further geographic diversification.

Portfolio by geography %

Europe 40
UK 35
North America 22
ROW 3

Sector bias towards growth sectors

The portfolio is weighted towards sectors that primarily have non-cyclical drivers, such as demographics, with 22% of the Portfolio invested in healthcare and education and 16% in business services. The remainder of the Portfolio is broadly spread across the industrial (17%), consumer goods and services (15%), leisure (12%) and TMT (10%) sectors.

Portfolio by sector %

Heathcare and education 22
Industrials 17
Business services 16
Consumer goods and services 15
Leisure 12
TMT 10
Financials 5
Other 3

Attractive and well-balanced vintage year exposure

The portfolio has an attractive maturity profile which balances near term realisation prospects with a strong pipeline of medium to longer term growth. Investments completed in 2014 or earlier, which are more likely to generate gains from realisations in the shorter term, represent 45% of the Portfolio. Against this, 55% of value is in investments made between 2015 and 2017, providing the Portfolio with medium to longer term growth as value created within these businesses translates into gains. Within the more mature holdings, relatively little value remains in companies acquired before 2008, with this category falling from 13% to 3% in the year. 

A modest increase in valuation multiples over the year

Within the largest 30 companies, the valuation multiple has increased to 10.6x at 31 January 2018, up from 9.7x at the start of the year. This increase has been driven by a combination of a change in the mix and overall weightings of the largest underlying companies and a modest increase in aggregate multiples overall. Looking across the wider portfolio, the aggregate valuation multiples are in line with our largest 30 companies.

The net debt/EBITDA ratio of the largest 30 companies increased to 4.2x from 3.6x, a result of the change of mix and weightings of the underlying companies.

Share price (LSE)

851p
3.00P (0.35%)
11:44PM 25 May 2018
The share price information is delayed by at least 15 minutes

Net Asset Value

959p
As of 31 January 2018
Next update: June 2018 – Q1 results
Year Net assets NAV per share Share price Dividends per share
Jan 2018 £664m 959p 818p 21p
Jan 2017 £613m 871p 698p 20p
Jan 2016 £521m 731p 545p 11p
Jan 2015 £507m 695p 575p 15.5p
Jan 2014 £494m 677p 563p 15.5p
Jan 2013 £460m 631p 487p 5p
Jan 2012 £415m 569p 357p 5p
Jan 2011 £389m 534p 308p 2.25p
Dec 2009 £338m 464p 305p 2.25p
Dec 2008 £327m 449p 187p 4.5p

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