TIDMSUPP
RNS Number : 7876T
Schroder UK Public Private Tst plc
29 November 2021
Schroder UK Public Private Trust plc
Announcement of Net Asset Value as of 30 September 2021
Schroder UK Public Private Trust plc (the "Company") today
announces its net asset value ("NAV") as of 30 September 2021.
Summary
-- NAV of 47.13p per share as of 30 September 2021, an increase
of 15.9% relative to the NAV as of 30 June 2021 (40.65p per
share).
-- Performance primarily driven by the successful initial public
offering ("IPO") of Oxford Nanopore Technologies ("ONT") which
resulted in a fair value gain of GBP62.8 million.
-- Further progress achieved in the rebalancing the portfolio
with one new private investment in disruptive global neobank,
Revolut Ltd ("Revolut"), and two new public investments in leading
automated test and assurance solutions provider, Spirent
Communications plc ("Spirent") and capital provider to alternative
investment managers, Petershill Partners plc ("Petershill
Partners").
-- Since the period end, the Company also completed its third
new private investment in leading market research technology
platform, Attest Technologies Ltd ("Attest").
-- Company is well-placed to capitalise on new investment
opportunities in both the public and private equity markets.
Introduction
Economic backdrop
UK equities rose over Q3 in local currency terms as the market
was impacted by a variety of competing factors. Western monetary
policymakers became more hawkish as inflationary pressures grew and
the US Federal Reserve (Fed) signalled it would begin to taper its
quantitative easing (QE) programme later this year. Meanwhile, the
Bank of England (BoE) remained on track to complete its pandemic QE
programme before the end of 2021.
A more hawkish tone from central bankers (and markedly higher
energy prices in late September) drove bond yields sharply up at
the period end. Yields rose back to levels seen in the spring and
10-year government bonds rose above 1% for the first time since
before the pandemic. Markets were also influenced by global growth
concerns centred on China. A zero-tolerance attitude by the Chinese
authorities to the Delta Covid-19 variant further disrupted supply
chains already strained by economies reopening.
While robust Q2 corporate earnings helped to support valuations,
the strength of the economic recovery has caught many companies by
surprise, causing disruption on a global scale. Rising global
delivery times point to higher inflation, and a volatile energy
market has further complicated any analysis of underlying trends.
Central banks focused on how transitory the post-Covid inflationary
surge might be and closely scrutinised second-round inflation risks
around wage growth.
Objectives and progress
The most important impact on the Company's portfolio in the
third quarter was the successful IPO of ONT on the London Stock
Exchange which had three notable consequences. Firstly, it resulted
in a substantial fair value gain of GBP62.8 million which acted as
the primary driver of NAV performance contributing to 94% of the
positive fair value gains over the period. Secondly, it resulted in
a significant improvement in the portfolio's overall liquidity
profile with the Company's quoted holdings increasing to 50.6% of
total investments (excluding Rutherford Health). And thirdly, a
partial sale of the holding at IPO provided net proceeds of
GBP10.6m, which when combined with the funds received from the sale
of Inivata, enabled further acceleration of the portfolio
rebalancing with three new investment completed during the
period.
Portfolio composition and valuation reviews
As of 30 June 2021, the Company had 34 portfolio holdings(1)
including 9 quoted holdings and 25 unquoted holdings. During the
period, the number and composition of holdings was impacted by the
following events:
-- New investment in Revolut.
-- New investment in Spirent.
-- New investment in Petershill Partners.
-- ONT completed its IPO.
As of 30 September 2021, the Company ended the period with 37
holdings(2) including 12 quoted holdings and 25 unquoted holdings.
All the Company's quoted holdings were valued using unadjusted
quoted prices except Rutherford Health which continues to be fair
value priced by Link Fund Solutions Limited ("LFS"), the Company's
Alternative Investment Fund Manager (AIFM). For the unquoted
holdings, the AIFM considered any material 'triggering' events
since the last valuation assessment as of 30 June 2021 and as such
conducted five valuation reviews to determine the fair value of the
portfolio as of 30 September 2021.
(1 Excluding 7 holdings with no value. 2 Excluding 6 holdings
with no value.)
Financial Performance
Attribution Analysis Quoted Unquoted Net (debt)/cash Other NAV
(GBPm)
Value at 30.06.21 87.8 254.2 1.3 26.1 369.4
------- --------- ---------------- ------- ------
+ Investments 18.2 11.0 (29.2) - -
------- --------- ---------------- ------- ------
- Realisations at value - (12.2) 40.1 (27.9) -
------- --------- ---------------- ------- ------
+/- Fair value gains (4.7) 61.1 - - 56.4
------- --------- ---------------- ------- ------
+/- FX losses 1.0 1.4 - 2.4
------- --------- ---------------- ------- ------
+/- Reclassified holdings 142.9 (142.9) - - -
------- --------- ---------------- ------- ------
+/- Costs and other movements - - (3.9) 3.9 -
------- --------- ---------------- ------- ------
Value at 30.09.21 245.2 172.6 8.3 2.1 428.2
------- --------- ---------------- ------- ------
Source: AIFM as of 30 September 2021.
The NAV as of 30 September 2021 was GBP428.2 million or 47.13p
per share reflecting an increase of 15.9% compared with the NAV as
of 30 June 2021.
The half year NAV return of +15.9% comprised:
-- Quoted holdings: -1.3%
-- Unquoted holdings: +16.5%
-- Foreign exchange: +0.6%
-- Costs and other movements: 0.0%
Portfolio
The Company's quoted holdings saw a decline in value of 5.4%
contributing -1.3% to the quarterly change in NAV. The largest
positive contributor to performance was IDEX Biometrics ASA
("Idex") which increased by 13% and which continued to make
progress on the path to full commercialisation of its biometric
sensors integrated into payment cards. The largest negative
contributors were Athenex, Immunocore and Johnson Matthey which
declined 35%, 5% and 13% respectively. The other quoted holdings
did not materially impact the portfolio with individual fair value
changes of less than GBP1.0 million.
The Company's unquoted holdings saw an increase in value of
24.0% contributing +16.5% to the quarterly change in NAV. The most
substantial positive contributor was ONT which completed its IPO
resulting in a fair value uplift of GBP62.8 million or 69.2% based
on the unadjusted quoted price on 30 September 2021 (612.5p per
share). As in the prior quarter, ONT is now the largest holding
within the portfolio representing 34.2% of total investments.
Elsewhere, the unquoted portfolio experienced three small
negative revaluations totalling GBP3.4 million, including
adjustments to Mafic and Industrial Heat following increased
uncertainty regarding the outlook for these businesses.
Foreign Exchange
During the quarter, the fair value of investments denominated in
USD, NOK and CHF benefited from the depreciation in the value of
GBP.
Cash, debt, and net current assets
As of 30 September 2021, the Company held GBP8.3 million in cash
with the revolving credit facility currently unutilised.
Investment Activity
Realisations
The most significant realisation during the period was the
partial sale of ONT. As part of the IPO process, ONT's existing
shareholders were offered the possibility to sell up to 10% of
their shareholding at the IPO price. As such, the Portfolio Manager
opted for the divestiture of 10% of the Company's shareholding.
While they remain highly confident of ONT's prospects to generate
continuous shareholder value, given the large position in the
portfolio, the Company decided to diversify its portfolio through a
partial realisation. The net proceeds from the secondary share sale
amounted to GBP10.6 million. The Company's remaining stake in ONT
was valued at GBP142.9 million as of 30 September 2021.
Investments
Early in the third quarter, as reported in the Q2 NAV
announcement, the Company made new investment in Revolut
(unquoted). In June 2021, the Company made an initial investment of
GBP3.5 million into Johnson Matthey (quoted), and during the third
quarter increased its holding to bring the total investment to
GBP7.5 million. Johnson Matthey is a global leader in the applied
materials chemistry, producing materials that are used in a wide
range of industrial processes from automotive exhaust catalysts to
the production of industrial gases.
In August 2021, the Company completed a $13.7 million investment
in the leading disruptive global neobank, Revolut alongside its
$800 million Series E funding round led by new investors, SoftBank
Vision Fund 2 and Tiger Global Management, valuing the business at
$33 billion. Revolut, the ambitious neobank with more than 16
million customers worldwide, plans to use the significant primary
investment to further its growth plans, in particular its ongoing
product innovation aimed at meeting customers' everyday financial
needs and aspirations, from quick and easy global transfers, to
managing everything from savings to insurance, to democratising
wealth and trading activities. It will also support the expansion
of Revolut's offering to US customers and its entry into the Indian
market and other international markets.
The Company subsequently made three further new investments in
Spirent (quoted), Petershill Partners (quoted), and after the
period end, Attest (unquoted). Further details on each company and
transaction are outlined below.
Spirent Communications
In September 2021, the Company made a GBP7 million investment
into publicly listed Spirent Communications plc ("Spirent"), a
leading provider of automated test and assurance solutions for
telecom networks and datacentres. As ethernet speeds are upgraded
and 5G networks are rolled out, new uses and services are
developed. The testing products and services that Spirent offers
are a critical component enabling the development and ongoing
monitoring of the performance of these networks.
The upcoming cycle of capital expenditure for the rollout of 5G
is expected to be an extended one because of the proliferation of
applications that will be made possible. We believe that Spirent
can therefore expect robust growth in demand for its services over
the coming years.
Petershill Partners
In September 2021, the Company participated in the IPO of
Petershill Partners, a capital provider to alternative investment
managers, making a GBP7 million investment. Alternatives (including
private equity, private credit and infrastructure investment) are a
fast-growing area of asset management, and there are a limited
number of specialist providers of growth capital for firms in this
space. Petershill has built a diversified portfolio of managers,
and with the capital raised as part of the IPO, it will seek to
make investments in other alternative managers over the coming
years.
We are therefore invested in both the strong underlying asset
growth of the existing managed portfolios, and an additional source
of growth through new investments. We expect Petershill to see an
attractive rate of earnings growth over the coming years.
Attest
In November 2021, the Company completed a $7.0 million
investment in leading market research technology platform, Attest,
as part of its $64 million Series B funding round. Attest's Series
B funding was led by an undisclosed growth investor with
participation from specialist tech investment firm Kismet and
existing investor, leading global venture capital firm NEA. Attest
is the first business services sector investment to enter the
portfolio.
Attest has built an intuitive software as a service platform
which aims to make checking ideas and actions with target consumers
as second nature as checking the time, so every business decision
can be grounded in data. Using Attest's technology, surveys can be
created and distributed to target consumers in as little as 90
seconds and results are significantly higher-quality, more
reliable, representative, and delivered faster than ever previously
possible. This self-serve technology is supported by Attest's
in-house team of research experts, leading to trustworthy data that
brands can rely on.
During the pandemic, Attest has achieved record revenue growth
and continued to support and grow its client base, including
Microsoft, Santander, Walgreens/Boots, Wise, Klarna, Organic Valley
and Fabletics. Attest's consumer reach has also increased, with
brands now able to access more than 110 million people in 49
countries. Via Attest, this power is now open to any user, in any
business to consumer company, on-demand any time.
This latest financing round is intended to help further
accelerate Attest's expansion in both Europe and North America, as
well as the company's mission to make high quality research simple,
fast and powerful for everyone on a continuous basis.
Top 10
The Company's top 10 holdings as of 30 September 2021 compared
with the respective holding as of 30 June 2021.
Holding Fair value % of total Fair value % of total
as of 30 investments as of 30 investments
June 2021 September
(GBP'000) 2021 (GBP'000)
Oxford Nanopore 90,745 26.5% 142,923 34.2%
----------- ------------- ---------------- -------------
Atom Bank 40,004 11.7% 40,004 9.6%
----------- ------------- ---------------- -------------
Rutherford Health 33,889 9.9% 33,889 8.1%
----------- ------------- ---------------- -------------
Immunocore 23,410 6.8% 22,829 5.5%
----------- ------------- ---------------- -------------
Benevolent AI 22,390 6.5% 22,390 5.4%
----------- ------------- ---------------- -------------
Reaction Engines 12,500 3.7% 12,500 3.0%
----------- ------------- ---------------- -------------
Seedrs 9,075 2.7% 11,768 2.8%
----------- ------------- ---------------- -------------
AMO Pharma 11,291 3.3% 11,576 2.8%
----------- ------------- ---------------- -------------
Revolut - 0.0% 10,168 2.4%
----------- ------------- ---------------- -------------
IDEX ASA 8,008 2.3% 9,132 2.2%
----------- ------------- ---------------- -------------
Source: AIFM as of 30 September 2021.
Rutherford Health
In August 2021, Rutherford Health ("Rutherford") made two
announcements in relation to material business arrangements.
Firstly, the company entered into an agreement under which SDI
Holding Limited ("SDI"), representing a UK-based investor, had
irrevocably undertaken to subscribe for 19 million new Rutherford
ordinary shares at a price of 65p per share to raise gross proceeds
of GBP12.35 million (subject to certain closing conditions).
Secondly, Rutherford entered into agreement with The First Investor
LLC, part of the Dubai-based Alfardan Group, to acquire all the
shares in Proton Partners International Health Care Investments
LLC, UAE in consideration for the issue of 64 million new shares in
Rutherford subject to certain conditions including satisfactory due
diligence to be conducted by both parties, notarial formalities,
and formal approval by the Rutherford Board.
In accordance with IPEV Guidelines, which set out the industry
standard methodologies for valuation of private capital
investments, the NAV reported today is based on information known
or knowable on 30 September 2021 and thus the valuation of
Rutherford is unchanged from 30 June 2021.
In November 2021, Rutherford also released its unaudited interim
results for the six months ended 31 August 2021. During the period,
patient numbers decreased 28% to 166 for cancer treatment and
increased 101% to 4,772 for diagnostics. The company's revenues
increased 36% to GBP4.9 million compared to the first half of FY21
with Proton Beam Therapy revenues remaining unchanged at GBP1.4
million. The company's operating loss also increased 17% to GBP18.5
million with a closing cash position of GBP3.1 million. Rutherford
also disclosed that should the investment by SDI not complete in
the near term, the Company will require working capital by around
the end of November 2021 and accordingly it is exploring
alternative options to provide the Group with working capital. We
note the following comment from the Notes to the Interim Accounts -
"In the event that the investment by SDI does not complete in the
very near term and in the absence of alternative funding, the
Company may not be able to continue as a going concern. In
addition, the Company will require additional future funding before
the Group is profitable. The board regularly reviews its financing
options and its discussions with potential funders and investors
indicate that should the Group require further funding, this would
be available, although at this point such funding is not committed.
As such a downside scenario detailed above together with the
potential for future fundraising not completing indicates the
existence of a material uncertainty which may cast significant
doubt upon the Group's ability to continue as a going concern". In
the light of this, we remain vigilant and in close contact with the
company.
For further details of the top 20 holdings, please refer to the
Portfolio page on the Company's website which contains links to
each portfolio company website with specific updates.
Outlook
The Company continues to be well placed to capitalise on new
investment opportunities in both public and private equity markets
with a focus on innovative UK businesses with disruptive
innovation, significant global growth potential, high quality
management teams and supported by highly reputable co-investors.
The longer-term ambition being to build a diversified portfolio of
venture and growth stage companies across the Company's six core
sectors which include Business Services, Consumer, Financials,
Health Care, Industrials and Technology.
In the near-term, when required, these new investments will be
funded by utilising the credit facility which remains undrawn, but
only when the Company has visibility on paying down the incremental
borrowing within twelve months. The intention being to maintain a
loan balance below 10% of gross asset value and remain prudent when
compared with peers. The portfolio manager continues to investigate
liquidity options for several companies within the portfolio to
support new investment activity in the coming months.
Finally, in the short term we may see further headwinds in the
portfolio inherited from the previous portfolio manager. Some of
these portfolio companies continue to be loss-making and in need of
further financing. The portfolio manager is actively engaged with
these companies but intends only to support those companies with
further financing which present an appropriate risk/reward profile.
Despite this, the continued rebalancing gives us increasing
confidence in the portfolio overall.
Past performance is not a guide to future performance and may
not be repeated. The value of investments and the income from them
may go down as well as up and investors may not get back the
amounts originally invested. The securities shown above are for
illustrative purposes only and are not to be considered a
recommendation to buy or sell.
Enquiries:
Schroder Investment Management Limited
Gareth Faith (Company Secretary) 0207 658 5264
Estelle Bibby (Press) 0207 658 3431
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
NAVUNRBRABUAUAA
(END) Dow Jones Newswires
November 29, 2021 02:00 ET (07:00 GMT)
Woodford Patient Capital (LSE:WPCT)
Historical Stock Chart
From Mar 2024 to Apr 2024
Woodford Patient Capital (LSE:WPCT)
Historical Stock Chart
From Apr 2023 to Apr 2024
