(LSE:
APAX)
Apax Global Alpha
Limited
Quarterly results for the period ended
31 March 2024
Apax Global Alpha (LON:APAX), the closed-ended
investment company providing access to the Apax Private Equity
Funds, today announced its first quarter results for the period
ended 31 March 2024.
Key
highlights
·
|
AGA's Adjusted
NAV1 was €1.25bn
(FY23 €1.29bn) at the end of Q1 2024, equivalent to an Adjusted NAV
per share of €2.54/£2.17.
|
·
|
Total NAV Return2 declined
in Q1 2024 and was (0.5)% ((1.9%) constant currency)
in the three months to 31 March 2024, with
performance impacted by negative developments in one of the Private
Equity Portfolio companies in the quarter.
|
·
|
Solid operating performance across
the Private Equity portfolio with Last Twelve Months ("LTM")
EBITDA3 growth of c.18.0% (FY23 18.0%). However, the
contribution of earnings to Q1 Private Equity returns slowed driven
by a small number of portfolio companies, including
Vyaire.
|
·
|
Following materially deteriorating
trading at Vyaire during Q1, AGA has taken a €24m writedown on its
value across the Private Equity and Debt portfolios, reducing AGA's
Private Equity exposure to Vyaire to c.€5m and Debt exposure to
Vyaire's first lien loan to €12m.
|
·
|
AGA deployed c.€23m in Private Equity
investments on a look-through basis in Q1 2024 with a further €62m
deployed since quarter-end. There were four new investments as well
as transformational add-on acquisitions for Private Equity
portfolio companies Oncourse Home Solutions and Palex.
|
·
|
The Debt portfolio, a unique feature
of AGA, continued to show good performance achieving a Total Return
of 3.5% (1.8% constant currency) in
the quarter.
|
·
|
The Board is reassessing the
Company's capital allocation policy and will update on progress of
the review at the Capital Markets Day on 26 June 2024.
|
Ralf
Gruss, Partner at Apax and a member of the AGA investment
committee, said:
"While Q1 performance was negatively impacted by developments
in one of the Private Equity portfolio companies, we believe AGA's
overall portfolio remains in good shape, offering solid value
growth for shareholders. We are seeing continued momentum with
several new private equity investments since the beginning of the
year and there is a good pipeline of both new investments and
exits. We believe the current share price significantly undervalues
the Company's Private Equity holdings."
Financial highlights
·
|
AGA was 94% invested as at 31 March
2024 and had unfunded commitments to the Apax Funds (together with
recallable distributions) of €908m.
|
|
|
·
|
At 31 March 2024, AGA's invested
portfolio was split 76% in Private Equity and 22% in Debt
Investments, with the remaining 2% invested across three Derived
Equity positions.
|
·
|
At the period end, AGA had €72m in cash
(including net current assets) in light of expected calls from the
Private Equity Funds in the second half of 2024.
|
|
Q1 2024
(EUR)
|
Q1 2024
(GBP)
|
FY 2023
(EUR)
|
FY 2023
(GBP)
|
Adjusted NAV1
|
1,249m
|
1,068m
|
1,288m
|
1,116m
|
Adjusted NAV1 per share
|
2.54
|
2.17
|
2.62
|
2.27
|
NAV1 per share
|
2.55
|
2.18
|
2.64
|
2.28
|
|
% of NAV
|
Q1 2024
|
Q1
2024 constant
currency
|
Total NAV
Return2
|
|
(0.5%)
|
(1.9%)
|
Total Return2 - Private
Equity
|
72%
|
(1.7%)
|
(3.2%)
|
Total Return2 - Debt
Investments
|
21%
|
3.5%
|
1.8%
|
Total Return2 - Derived
Equity
|
1%
|
13.6%
|
11.8%
|
Cash & Others
|
6%
|
|
|
Portfolio highlights
·
|
AGA offers access to a global portfolio of
mostly private companies that are not available to public market
investors elsewhere.
|
·
|
The Private Equity portfolio is balanced across
Apax Fund vintages, with 40% in the investing phase, 38% in the
maturity phase, and 22% in the harvesting phase.
|
·
|
Main drivers of growth came from Apax X
portfolio companies, demonstrating the maturity of that
portfolio.
|
·
|
Continued reduction of listed exposure in the Private
Equity portfolio via share sell downs. Listed exposure in Private
Equity portfolio was 4% at end of March 2024 compared to 6% at 31
December 2023.
|
·
|
Capital not invested
in Private Equity is primarily invested in Debt Investments to
absorb excess liquidity, thereby limiting cash drag, producing
additional returns, and enhancing the robustness of AGA's balance
sheet.
|
·
|
AGA invested €9.6m
across two new Debt positions and received €44.7m mainly from four
full Debt exits.
|
·
|
AGA still has a small
exposure to Derived Equity, and following the sale of two positions
in 2023, AGA currently holds three positions valued at
€18.1m.
|
|
|
For further information regarding the
announcement of AGA's Q1 2024 Results, including the
Company's results presentation and details for
today's analyst and investor webcast at 9.30am (UK time), please
visit
www.apaxglobalalpha.com.
Contact details
Katarina Sallerfors,
Investor Relations - AGA
|
Telephone:
+44 207 666 6526
|
Email:
Katarina.sallerfors@apax.com
|
|
|
|
APPENDIX
Movements in
Adjusted NAV
Adjusted NAV movements (€m)
|
Private
Equity
|
Debt
Investments
|
Derived
Equity
|
Cash
|
Treasury Shares/ Facility
drawn
|
Other4
|
Q1 24 Total
|
Adjusted NAV at 31.12.23
|
890.7
|
288.2
|
15.0
|
101.4
|
-
|
(7.7)
|
1,287.6
|
+ Investments
|
27.2
|
9.6
|
-
|
(40.6)
|
-
|
3.8
|
-
|
- Distributions/
divestments
|
(3.8)
|
(44.7)
|
-
|
35.1
|
-
|
13.4
|
-
|
+ Interest and dividend
income
|
-
|
-
|
-
|
7.8
|
-
|
-
|
7.8
|
+/- Gains/(losses)
|
(29.7)
|
(0.6)
|
2.3
|
-
|
-
|
-
|
(28.0)
|
+/- FX
gains/(losses)5
|
13.9
|
4.6
|
0.2
|
0.1
|
-
|
-
|
18.8
|
+/- Costs and other
movements
|
-
|
-
|
-
|
(2.6)
|
-
|
-
|
(2.6)
|
- Dividends paid
|
-
|
-
|
-
|
(32.4)
|
-
|
-
|
(32.4)
|
+/- Performance fee
reserve6
|
-
|
4.5
|
0.1
|
-
|
(6.6)
|
-
|
(2.0)
|
+/- Shares purchased
|
-
|
-
|
-
|
(6.6)
|
6.6
|
-
|
-
|
+/- Revolving credit
facility
drawn/repaid
|
-
|
-
|
-
|
-
|
-
|
-
|
-
|
Adjusted NAV at 31.03.24
|
898.3
|
261.6
|
17.6
|
62.2
|
-
|
9.5
|
1,249.2
|
Private Equity
- operational metrics
Private Equity - operational
metrics
|
31 March
2024
|
31 December
2023
|
Portfolio year-over-year LTM revenue
growth3
|
10.7%
|
12.1%
|
Portfolio year-over-year LTM EBITDA
growth3
|
18.0%
|
18.0%
|
Enterprise Value / EBITDA valuation
multiple3
|
16.8x
|
16.6x
|
Net debt / EBITDA
multiple3
|
4.4x
|
4.6x
|
|
|
|
| |
Debt
Investments - operational metrics
Debt Investments -
operational metrics
|
|
31 March
2024
|
31 December
2023
|
Debt
average yield to maturity
|
|
12.9%
|
12.0%
|
Debt
average years to maturity
|
|
4.4
|
4.4
|
Debt
average income yield
|
|
10.2%
|
10.4%
|
Other Invested
Portfolio highlights
Invested Portfolio
analysis7
|
€m
|
€m
|
%
|
%
|
- AEVI
|
2.3
|
|
0%
|
|
- AEVII
|
22.2
|
|
2%
|
|
- AVIII
|
40.7
|
|
3%
|
|
- AIX
|
255.0
|
|
22%
|
|
- AX
|
462.6
|
|
39%
|
|
- AXI
|
14.1
|
|
1%
|
|
- AMI
|
16.3
|
|
1%
|
|
- AMI II
|
1.9
|
|
0%
|
|
- ADF
|
56.5
|
|
5%
|
|
- ADF II
|
19.4
|
|
2%
|
|
- AGI
|
7.3
|
|
1%
|
|
Private Equity
|
|
898.3
|
|
76%
|
Debt Investments
|
|
263.1
|
|
22%
|
Derived Equity
|
|
18.1
|
|
2%
|
Total
|
|
1,179.5
|
|
100%
|
Footnotes
|
|
1
|
Adjusted
NAV reflects Total NAV of €1,251.2m less performance fee reserve of
€2.0m
|
2
|
"Total NAV
Return" means the movement in the Adjusted NAV per share over the
quarter plus any dividends paid. "Total Return" reflects the
sub-portfolio performance on a stand-alone basis. It excludes items
at the overall AGA level such as cash, management fees, and
costs
|
3
|
Gross Asset
Value weighted average of the respective metrics across the
portfolio. Investments can be excluded for reasons such as:
investments in the financial services sector; companies with
negative EBITDA (or moving from negative to positive EBITDA in the
case of growth metrics); investments that are written off;
companies where EBITDA is not meaningful for company specific
reasons. Due to these adjustments, the comparatives may not be on a
like for like basis. LTM EBITDA Growth represents 89% of AGA's
Private Equity portfolio NAV, Net Debt / EBITDA Multiple and
Enterprise Value / EBITDA Valuation Multiple represents 80% of
AGA's Private Equity portfolio NAV
|
4
|
Other
reflects net current assets.
|
5
|
FX on cash
includes the revaluation of cash balances and net gain or losses
arising from the differences in exchange rates between transaction
dates and settlement dates, and unrealised net gains or losses
arising from the translation into euro of assets and liabilities
(other than investments) which are not denominated in
euro
|
6
|
Movement in
the performance fee reserve reflects the performance fee reserve
accrued by the Company's at 31 March 24 adjusted for performance
fee paid in the period. This does not represent the underlying
Private Equity portfolio's carried interest.
|
7
|
Invested
Portfolio excludes cash and cash equivalents, revolving credit
facility drawn and net current assets, including these the NAV was
€1,251.2m and Adjusted NAV was €1,249.2m reflecting adjustment of
€2.0m for the estimated performance fee reserve accrued.
|
|
|
Notes
1.
|
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" or "the Investment Adviser"
|
2.
|
Please be advised that this
announcement may contain inside information as stipulated under the
Market Abuse Regulations (EU) NO. 596/2014 ("MAR")
|
3.
|
This announcement is 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 amended (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
|
4.
|
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
|
5.
|
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.
|
About Apax Global Alpha
Limited
AGA is a Guernsey registered
closed-ended investment Company listed on the London Stock
Exchange. 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.
The Company makes Private Equity
investments in Apax Funds, and has a portfolio of primarily Debt
Investments, derived from the insights gained via Apax's Private
Equity activities.
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") is a
leading global private equity advisory firm. For over 50 years,
Apax has worked to inspire growth and
ideas that transform businesses. The
firm has raised and advised funds with aggregate commitments of
more than $77 billion. The Apax
Funds invest in companies across four
global sectors of Tech, Services, Healthcare, and
Internet/Consumer. These funds provide long-term equity financing
to build and strengthen world-class companies. For further
information about Apax, please visit www.apax.com.
Apax is authorised and regulated by
the Financial Conduct Authority in the UK.