3 Year Anniversary - Investment Manager Appt
23 August 2018
GRESHAM HOUSE STRATEGIC PLC
(the "Company")
Gresham House Strategic plc marks three-year anniversary of appointment of new investment manager with strong NAV outperformance and significant profitable realisation.
Gresham House Strategic (GHS) plc, the AIM-listed investment company, this month, marks the third anniversary of the appointment of Gresham House Asset Management, as its fund management team, celebrating:
- Share price growth of 35.1% over the 3-year period, maiden dividend of 15p paid in 2017, and grown by 15% in 2018 to 17.25p
- A net asset value (NAV) per share increase of 27.3% over the last 3 years - compared to 15.5% and 16.1% for the FTSE All Share and FTSE Small Cap (ex-Investment Trusts) Indices respectively in the same period
- Portfolio deployed in 'value' investments that offer a higher forecast sales growth of 12.2% compared to the FTSE All-Share of 3.1%, whilst trading on a lower valuation (GHS Portfolio EV/EBITDA 7.8x versus 9.5x FTSE All-Share)
- Significant recent partial realisation of £9.6 million of the fund's major investment, IMImobile, crystallising £4.96 million profit, a 19% IRR and 2.13x money multiple (GHS retains a 6.3% holding in IMImobile)
- Total realisations of £24.2m in the 3-year period, cumulatively generating £9.0m realised profits at 28.5% IRR and 1.60x money, significantly exceeding target returns
- Additional £1.2m returned to shareholders through share buybacks in 2017 and 2018
David Potter, Chairman, Gresham House Strategic plc, commented, "The GHS Fund has performed exceptionally well, with share price growth of over a third, and NAV per share growth of 27.3% since the 2015 restructuring of SPARK Ventures. This NAV growth represents an outperformance of more than 11.2% since inception versus the FTSE Small Cap Ex-Investment Trusts index. The focus remains on a continued hands-on approach, adding value through constructive engagement with investee stakeholders. I am pleased at the Fund's progress which is testimony to our talented investment management team."
Graham Bird, Fund Manager of Gresham House Strategic Plc stated "GHS has outperformed and achieved significant positive NAV appreciation whilst allowing for a progressive dividend policy to be initiated, supported by modest share buy-backs. I am excited by the attractive valuation characteristics and prospective growth of the portfolio to generate further strong total returns. The profitable realisations provide further potential for dividend growth alongside additional opportunities for the investment team to engage actively with more companies which can benefit from strategic, operational or management initiatives, in so doing identifying value creation catalysts in the small cap sector of the market."
Ends.
For further information, contact
|
Gresham House Strategic plc |
David Potter |
07711 450 391 |
|
Gresham House Asset Management Ltd Investment Manager |
Graham Bird |
0203 837 6270 |
|
finnCap Ltd Nominated Adviser and Broker |
Matt Goode / William Marle / Emily Watts |
0207 220 0500
|
|
Attila Consultants |
Charles Cook / Nita Shah |
0207 947 4489 |
Notes to editors
1. In August 2015, AIM-listed SPARK Ventures, changed its name to Gresham House Strategic plc and appointed Gresham House Asset Management, the specialist asset manager, as its investment adviser, which made a significant investment in SPARK Ventures to support the new investment mandate.
2. The investment portfolio management mandate was granted to Gresham House, with Graham Bird, Investment Director of Strategic Public Equity and Tony Dalwood, Chair of the Strategic Public Equity Investment Committee managing the portfolio.
3. The Strategic Public Equity mandate utilises the principles and practices of private equity to invest in influential stakes in UK smaller public and private companies which it believes to be undervalued. As such, the team has an engaged, active style of investing, working closely with management teams, to create shareholder value through strategic or operational initiatives, supporting a clear 3-5 year management plan to implement these initiatives.
4. The concentrated portfolio currently comprises 15 companies: IMImobile, Northbridge, BeHeard, MJ Hudson, Tax Systems, Escape Hunt, The Quarto Group, SpaceandPeople, Centaur, PCF Group, Augean, ProPhotonix Limited, Smartspace Software (formerly Redstone Connect), Universe Group, and an investment in Hanover Active Equity Partners II LP.
5. GHS plc recently announced it had realised 42.2% of its holding in IMImobile for £9.60 million, generating £4.96 million profit. This realisation represented a 19% IRR and 2.13x money multiple, significantly above the company's stated target return of 15% IRR. Following the sale, GHS has a resultant holding of 6.3% of the issued share capital of IMImobile.
6. In June 2018, GHS plc announced positive preliminary results, and last year, it paid a maiden dividend of 15p per share, with 15% growth announced on this year's dividend at 17.25p per share. A share buyback programme of up to £1m was also announced at that time and was completed on 18 June 2018
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