TIDMGABI TIDMGABC
RNS Number : 4541Z
GCP Asset Backed Income Fund Ltd
25 January 2022
25 January 2022
GCP Asset Backed Income Fund Limited
(the "Company" or "GCP Asset Backed")
LEI: 213800FBBZCQMP73A815
Net Asset Value and Investment Update
GCP Asset Backed, which invests in asset backed loans, announces
that, as at 31 December 2021, the unaudited net asset value ("NAV")
per ordinary share of the Company (including current period
revenue) is 99.29 pence per share.
NAV
The NAV performance for the 3 month period is a positive
movement of 0.35 pence per share after the payment of dividends, an
increase of 0.35 per cent.
The positive NAV performance for the period was driven by a
combination of excess earnings in the period and upwards
revaluation of an asset finance loan by the Valuation Agent.
Portfolio Update
The only portfolio assets that remain categorised as high risk
are the loan to a co-living group (the "Co-living Group") and the
two community facility loans, representing an aggregate 6.98% of
the total portfolio value.
The portfolio continues to rotate well with GBP44.7m repaid and
GBP46.9m deployed in the period. The Investment Manager continues
to target loans to borrowers it already knows, in sectors that have
performed well for the Company and which offer attractive,
risk-adjusted returns.
Co-living
There have been no material movements in the position of the
Co-living Group loan since the announcement on 22 December
2021.
We are not proposing any change to the holding value of the
Co-living Group loan, in line with the decision to only recognise
movements on the receipt of funds. The value of the loan therefore
continues to be held in line with the initial NAV write-down on 13
September 2021.
Community Facilities
The Company has provided loans to two community facilities.
These facilities house a variety of small businesses including
bars, food outlets, co-working and studio space.
A sale process for the two community assets was commenced over
the summer of 2021 with the appointment of a preferred bidder
occurring at the end of September. This initial preferred bidder
was unable to complete the bid within the given timescale and,
therefore, a second party was appointed as preferred bidder and the
assets transferred to new ownership in the period.
The Investment Manager is working closely with the new owner and
significant wins have already been achieved on the two assets,
including reaching agreement to turn the large garden area at the
Hackney site into a bar and terrace and the drawing up of plans to
convert the basement at the Peckham site into studios, for which
there is currently a waiting list of potential tenants.
Both assets continue to be impacted by the Omicron variant and
the UK Government having imposed "Plan B" coronavirus
restrictions.
CHP and ROC Engines
This loan defaulted in March 2019 and was sold in April 2021. As
reported in the NAV announcement of 15 July 2021, GBP1.1m of this
loan was held in escrow following the sale and subject to potential
warranty claims, with GBP1m due to be released in December 2021 and
GBP0.1m due to be released in March 2023. We are pleased to report
that the full GBP1.1m was released back to the Company in December
2021.
There remains a further small amount of money due under the sale
documentation and the Company still retains security over a further
engine on a separate site. This site is expected to be awarded
planning permission this quarter and has a significant renewable
heat incentive tariff linked to it. No value has been ascribed in
the NAV to this engine or any additional funds due pursuant to the
sale, but the Investment Manager will continue to monitor these
assets closely.
Dividends
On 3 November 2021, the Company declared a quarterly dividend in
respect of the period from 1 July 2021 to 30 September 2021 of
1.575p per share, which was paid on 10 December 2021.
Outlook
The Investment Manager remains focussed on recovering value from
the Co-living Group. However, it remains highly encouraged by the
continued strong level of repayments that are being experienced
across the balance of the portfolio. These repayments continue to
be matched by a strong pipeline of opportunities in sectors that
the Investment Manager finds attractive.
The Investment Manager will be holding a webinar on 28 January
2022 at 10am to provide more detail on the portfolio. For any
investor interested in joining, please e-mail
zoe.french@graviscapital.com .
For further information, please contact:
Gravis Capital Management Ltd +44 (0)20 3405 8500
David Conlon
Joanne Fisk
Investec Bank plc +44 (0)20 7597 4000
Helen Goldsmith
Denis Flanagan
Neil Brierley
Buchanan/Quill +44 (0)20 7466 5000
Helen Tarbet
Sarah Gibbons-Cook
Henry Wilson
Notes to Editors
GCP Asset Backed is a closed ended investment company traded on
the Main Market of the London Stock Exchange. Its investment
objective is to generate attractive risk-adjusted returns primarily
through regular, growing distributions and modest capital
appreciation over the long term.
The Group seeks to meet its investment objective by making
investments in a diversified portfolio of predominantly UK based
asset backed loans which have contracted, predictable medium to
long term cash flows and/or physical assets.
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