TIDMAPAX
RNS Number : 3613H
Apax Global Alpha Limited
17 August 2016
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR
INDIRECTLY, IN WHOLE OR IN PART, INTO OR WITHIN THE UNITED STATES
OR TO "US PERSONS" (AS DEFINED IN REGULATION S UNDER THE UNITED
STATES SECURITIES ACT OF 1933, AS AMED (THE "SECURITIES ACT")) OR
INTO OR WITHIN AUSTRALIA, CANADA, SOUTH AFRICA OR JAPAN. RECIPIENTS
OF THIS ANNOUNCEMENT IN JURISDICTIONS OUTSIDE THE UK SHOULD INFORM
THEMSELVES ABOUT AND OBSERVE ANY APPLICABLE LEGAL REQUIREMENTS IN
THEIR JURISDICTIONS. IN PARTICULAR, THE DISTRIBUTION OF THE
ANNOUNCEMENT MAY BE RESTRICTED BY LAW IN CERTAIN JURISDICTIONS.
Note that references in this announcement to Apax Global Alpha
Limited have been abbreviated to "AGA" or "the Company". References
to Apax Partners LLP have been abbreviated to "Apax Partners" or
"the Investment Adviser"
FOR IMMEDIATE RELEASE
17 August 2016
(LSE: APAX)
Apax Global Alpha Limited
Unaudited Interim Results for the period ended 30 June 2016
For further information regarding the announcement of AGA's 2016
Interim Report and Accounts, including the details for today's
analyst and investor webcast at 9.30am (UK time), please visit
www.apaxglobalalpha.com/investor-information/calendar
Financial highlights for the six months to 30 June 2016
-- Adjusted NAV of EUR894.4m, down from EUR923.6m at 31 December 2015
-- Adjusted NAV per share of EUR1.82 (GBP1.52), compared to
EUR1.88 (GBP1.38) at 31 December 2015
-- Second semi-annual dividend declared of 3.95 pence per share,
equivalent to 2.5% of euro NAV at 30 June 2016 of EUR22.5m will be
paid on 14 September 2016
-- First semi-annual dividend paid of 3.69 pence per share,
equivalent to 2.5% euro NAV at 31 December 2015 of EUR23.4m was
paid in April 2016
-- Total Return was negative 0.6%. On a constant currency basis,
Total Return was positive 0.6%
-- AGA was 94% invested and had a cash balance of EUR48.5m
Investment highlights for the six months to 30 June 2016
-- Well-balanced invested portfolio: Private Equity (52%) and Derived Investments (48%)
-- Sector exposure balanced across all Apax Partners' focus
industries. Tech & Telco was the most heavily weighted sector,
accounting for 37% of the invested portfolio
-- Geographic bias towards North America, representing 59% of the invested portfolio
Performance
-- Portfolio was stable in a difficult market environment.
Portfolio performance was broadly neutral with a Total Return of
-0.6% up to 30 June 2016.
-- Private Equity had a positive performance of 0.9% largely
driven by strong operational performance from the underlying
portfolio companies, somewhat offset by lower valuation
multiples.
-- Derived Investments were down 0.4%. Positive interest income
was offset by write-downs for a small number of Debt
Investments.
Private Equity - Operational Metrics 30 June 2016 31 December 2015
Portfolio year-over-year Last Twelve Months (LTM) revenue growth(1) 7.4% 7.8%
===================================================================== ============ ================
Portfolio year-over-year LTM EBITDA growth(1) 9.8% 9.0%
===================================================================== ============ ================
Average EV/EBITDA multiple(1) 11.9x 12.4x
===================================================================== ============ ================
Average net debt / EBITDA(1) 4.4x 4.6x
===================================================================== ============ ================
Number of new investments(2) 1 9
===================================================================== ============ ================
Number of exits(2) 7 4
-- Private Equity portfolio highlights:
o Apax Funds have returned EUR38.7m to AGA in H1 2016, despite a
weakened exit environment
o Apax VIII closed one new investment, which was bridge-funded
by the fund's capital call facility. In addition Apax VIII
announced three new investments signed up during H1 2016
o Aggregate IRR generated on exited investments was 36% for the
Private Equity portfolio
Derived Investments - Operational Metrics 30 June 2016 31 December 2015
Yield to maturity(3) of debt investments 12.7% 11.5%
=========================================================== ============ ================
Average years to maturity for debt investments (in years) 5.6 6.1
=========================================================== ============ ================
Average income yield(4) of debt investments 10.1% 9.6%
=========================================================== ============ ================
Year-over-year LTM EBITDA growth debt investments(5) 1.3% 5.0%
=========================================================== ============ ================
Year-over-year LTM earnings growth equity investments(6) 18.5% 14.8%
=========================================================== ============ ================
Average P/E multiple(7) of equity investments 17.9x 20.0x
Number of new investments(8) 5 10
Number of full exits(9) 6 3
-- Derived Investments portfolio highlights:
o Fully exited two debt investments and four listed equity
investments, realising total proceeds of EUR51.9m. The aggregate
IRR on these realisations was 26.7%. In addition, proceeds from
partial realisations totalled EUR20.7m
o In the 6 months to 30 June 2016, AGA made one new investment
in debt, four new investments in listed equities and one add-on
investment in equities, totalling EUR65.2m
Commenting on the results, Tim Breedon CBE, Chairman of Apax
Global Alpha, said:
"I am pleased to present the Company's 2016 half year results,
which I believe demonstrate the resilience of the AGA portfolio.
Despite challenging market conditions, the portfolio finished only
marginally down for the first half of the year with a negative 0.6%
Total Return. This was primarily due to income from Derived
Investments and positive Private Equity performance being offset by
Derived Investments unrealised losses and adverse FX."
"I believe that AGA continues to represent an attractive
long-term investment for our shareholders and we continue to build
and maintain a portfolio with considerable returns potential."
Commenting on AGA's investment focus, Nico Hansen, CIO of Apax
Partners, said:
"The volatile conditions presented some challenges in the first
quarter and tested the portfolio's fundamentals. AGA has held up
well in the first half, with improving performance in the second
quarter."
"I'm satisfied with the Private Equity portfolio's performance.
Derived Investments were more mixed: interest income was strong but
was offset by a small number of debt valuation declines. We believe
overall performance will reverse across the positions which
currently see mark to market valuation declines."
Financial highlights
Private Equity Derived Investments Cash Others Total
EURm EURm
EURm EURm EURm
Adjusted NAV as of 31 December 2015 469.4 432.4 22.9 (1.1) 923.6
+ Investments - 65.2 (65.2) - -
- Divestments (38.7) (72.6) 107.1 4.2 -
+ Interest and dividend income - - 14.5 2.3 16.8
+/- Unrealised FV movement 8.4 (16.7) - - (8.3)
+/- Realised FV movement - (1.9) - - (1.9)
+/- FX losses (3.0) (7.3) (0.7) - (11.0)
+/- Costs and others - - (4.7) (0.9) (5.6)
- Dividends paid - - (23.4) - (23.4)
+/- performance fee reserve (1.1) 7.3 (2.0) - 4.2
Adjusted NAV as of 30 June 2016 435.0 406.4 48.5 4.5 894.4
Invested portfolio analysis at 30 June 2016
Asset class EURm EURm % %
Private Equity 440.3 52
==================== ====== ====== === ===
* AEVI 2.9 0
==================== ====== ====== === ===
* AE VII 79.8 9
==================== ====== ====== === ===
* AE VIII 353.1 42
==================== ====== ====== === ===
* AMI 4.5 1
==================== ====== ====== === ===
Derived Investments 407.8 48
==================== ====== ====== === ===
* Debt 314.5 37
==================== ====== ====== === ===
* Equities 93.3 11
==================== ====== ====== === ===
Total 848.1 848.1 100 100
==================== ====== ====== === ===
Sector mix Invested portfolio Private Equity Derived Investments
EURm % % %
Tech & Telco 313.2 37 36 38
============= ====== ================== ============== ===================
Services 234.3 28 31 24
============= ====== ================== ============== ===================
Consumer 157.8 19 18 20
============= ====== ================== ============== ===================
Healthcare 131.0 15 14 17
============= ====== ================== ============== ===================
Other 11.8 1 1 1
============= ====== ================== ============== ===================
Total 848.1 100 100 100
============= ====== ================== ============== ===================
Geographic analysis Invested portfolio Private Equity Derived Investments
EURm % % %
North America 500.4 59 51 68
==================== ====== ================== ============== ===================
UK 23.2 2 3 3
==================== ====== ================== ============== ===================
Switzerland 15.6 2 0 4
==================== ====== ================== ============== ===================
Rest of Europe 190.9 23 34 10
==================== ====== ================== ============== ===================
India 85.3 10 7 13
==================== ====== ================== ============== ===================
China 13.5 2 1 2
==================== ====== ================== ============== ===================
RoW 19.2 2 4 0
==================== ====== ================== ============== ===================
Total 848.1 100 100 100
==================== ====== ================== ============== ===================
Summary of top 10 investments in Private Equity and Derived
Investments
Valuation NAV Invested portfolio
EURm % %
Top 10 Private Equity
============================= ========= === ==================
EVRY ASA 42.5 5 5
============================= ========= === ==================
GlobalLogic Inc. 41.7 5 5
============================= ========= === ==================
Assured Partners 35.5 4 4
============================= ========= === ==================
Exact Software 31.4 3 4
============================= ========= === ==================
Azelis S.A. 26.6 3 3
============================= ========= === ==================
One Call / Align 26.1 3 3
============================= ========= === ==================
Full Beauty 24.3 3 3
============================= ========= === ==================
Wehkamp 23.7 3 3
============================= ========= === ==================
Idealista 17.6 2 2
============================= ========= === ==================
Shriram City 17.4 2 2
============================= ========= === ==================
Other 153.5 16 18
============================= ========= === ==================
Total Private Equity 440.3 49 52
============================= ========= === ==================
Top 10 Derived Investments
============================= ========= === ==================
Full Beauty 30.8 3 4
============================= ========= === ==================
Ellucian 27.3 3 3
============================= ========= === ==================
Epicor 21.0 2 2
============================= ========= === ==================
Azelis S.A. 19.7 2 2
============================= ========= === ==================
Genex 19.2 2 2
============================= ========= === ==================
Compuware 18.8 2 2
============================= ========= === ==================
Acelity (Kinetic Concepts) 18.4 2 2
============================= ========= === ==================
Assured Partners 17.7 2 2
============================= ========= === ==================
Advantage Sales & Marketing 17.1 2 2
============================= ========= === ==================
Strides Shasun 17.0 2 2
============================= ========= === ==================
Other 200.8 23 25
============================= ========= === ==================
Total Derived Investments 407.8 45 48
============================= ========= === ==================
Total Investments 848.1 94 100
============================= ========= === ==================
Cash 48.5 5 0
============================= ========= === ==================
Net current assets 4.5 1 0
============================= ========= === ==================
Total NAV 901.1 100 0
============================= ========= === ==================
Performance fee reserve (6.7)
============================= ========= === ==================
Total Adjusted NAV 894.4
============================= ========= === ==================
Contact details
Investor Relations
Sarah Wojcik
Telephone: +44 (0)20 7872 6300
Email: investor.relations@apaxglobalalpha.com
Media enquiries (Apax Global Alpha Limited)
Georgiana Brunner/Annabel Clay, Greenbrook Communications
Telephone: +44 (0)20 7952 2000
Email: aga@greenbrookpr.com
Media enquiries (Apax Partners LLP)
Alex Wessendorff
Telephone: +44 (0)20 7872 6461
Email: alex.wessendorff@apax.com
Company Secretary
Matt Horton/Jacques Colley, Aztec Group
Telephone: +44 (0)1481 749 700
Email: AGA-Admin@aztecgroup.co.uk
Notes
1. The information presented herein is not an offer for sale
within the United States of any equity shares or other securities
of Apax Global Alpha Limited ("AGA"). AGA has not been and will not
be registered under the US Investment Company Act of 1940, as
amended (the "Investment Company Act"). In addition, AGA's shares
(the "Shares") have not been and will not be registered under the
Securities Act or any other applicable law of the United States.
Consequently, the Shares may not be offered or sold or otherwise
transferred within the United States, or to, or for the account or
benefit of, US Persons, except pursuant to an exemption from the
registration requirements of the Securities Act and under
circumstances which will not require AGA to register under the
Investment Company Act. No public offering of the Shares is being
made in the United States.
2. This announcement may include forward-looking statements. The
words "expect", "anticipate", "intends", "plan", "estimate", "aim",
"forecast", "project" and similar expressions (or their negative)
identify certain of these forward-looking statements. These
forward-looking statements are statements regarding AGA's
intentions, beliefs or current expectations concerning, among other
things, AGA's results of operations, financial condition,
liquidity, prospects, growth and strategies. The forward-looking
statements in this presentation are based on numerous assumptions
regarding AGA's present and future business strategies and the
environment in which AGA will operate in the future.
Forward-looking statements involve inherent known and unknown
risks, uncertainties and contingencies because they relate to
events and depend on circumstances that may or may not occur in the
future and may cause the actual results, performance or
achievements of AGA to be materially different from those expressed
or implied by such forward looking statements. Many of these risks
and uncertainties relate to factors that are beyond AGA's ability
to control or estimate precisely, such as future market conditions,
currency fluctuations, the behaviour of other market participants,
the actions of regulators and other factors such as AGA's ability
to continue to obtain financing to meet its liquidity needs,
changes in the political, social and regulatory framework in which
AGA operates or in economic or technological trends or conditions.
Past performance should not be taken as an indication or guarantee
of future results, and no representation or warranty, express or
implied, is made regarding future performance. AGA expressly
disclaims any obligation or undertaking to release any updates or
revisions to these forward-looking statements to reflect any change
in AGA's expectations with regard thereto or any change in events,
conditions or circumstances on which any statement is based after
the date of this announcement, or to update or to keep current any
other information contained in this announcement. Accordingly,
undue reliance should not be placed on the forward-looking
statements, which speak only as of the date of this
announcement.
Footnotes
(1) Represents the weighted average of the respective metrics
across the underlying portfolio companies, using latest available
information
(2) Represents investments and exits during the half year ended
at the indicated date. New investments during H2 2015 includes
Azelis' acquisition of Koda which required additional equity
investment from the Apax Private Equity Funds. During H1 2016 there
were 4 full closed exits (Rhiag, King, Auto Trader and Tommy
Hilfiger China) and 3 closed partial exits represented by the IPO
of Ascential, a secondary sale of Capio shares in Q1 2016 and
partial sale of shares in Garda. The above number of exits excludes
the recapitalisation of Evry
(3) GAV weighted average yield to maturity (YTM) of the Derived Debt Investments
(4) GAV weighted average of the current full year income (annual
coupon/clean price as at 30 June 2016) for each debt position in
the Derived Debt Investments at 30 June 2016
(5) GAV weighted average of latest available EBITDA growth,
since prior year, of the underlying Derived Debt Investments
(6) GAV weighted average of the latest earnings growth, since
prior year, of the underlying Derived Equity Investments. Excludes
Palo Alto
(7) GAV weighted Price Earnings multiple of Derived Equity Investments
(8) New investments in debt in the 6 months to 30 June 2016 were
in Ellucian and four completed new equity positions in Sophos, Palo
Alto, Fortinet, and Edelweiss. December comparison is for the six
months ending at the indicated date
(9) Disposals in 6 months to 30 June 2016 consisted of debt
realisations in Physiotherapy and Exact first lien debt and equity
realisations in Greene King, Zhaopin, Karur Vysya Bank Ltd and
Sinopharm. December comparison is for the six months ending at the
indicated date.
About Apax Global Alpha Ltd
AGA is a Guernsey registered closed-ended collective investment
scheme incorporated as a non-cellular company that listed on the
London Stock Exchange on 15 June 2015. It is regulated by the
Guernsey Financial Services Commission.
AGA's objective is to provide shareholders with capital
appreciation from its investment portfolio and regular dividends.
The Company is targeting an annualised Total Return, across
economic cycles, of 12-15% (net of fees and expenses) including a
dividend yield of 5% of Net Asset Value (NAV), once fully
invested.
The investment policy of the Company is to make private equity
investments in Apax Funds and Derived Investments which are
investments in equities and debt derived from the insights gained
via Apax Partners' Private Equity activities. The Company's
portfolio is expected to be allocated in approximately equal
proportions between Private Equity and Derived Investments,
although the investment mix will fluctuate over time due to market
conditions, investment opportunities, cash flow requirements, the
dividend policy and other factors.
Further information regarding the Company and its publications
are available on the Company's website at
www.apaxglobalalpha.com
About Apax Partners LLP
Apax Partners LLP ("Apax Partners") is a leading global private
equity advisory firm. It operates globally and has more than 30
years of investing experience. Apax Partners has advised funds that
total over EUR40 billion in aggregate as at 30 June 2016. Funds
advised by Apax Partners invest in companies across four global
sectors of Tech & Telco, Services, Healthcare and Consumer.
These funds provide long--term equity financing to build and
strengthen world--class companies. For further information about
Apax Partners, please visit www.apax.com.
Apax Partners LLP is authorised and regulated by the Financial
Conduct Authority in the UK.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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