ICG Enterprise Trust Plc: Q3 update for the three months ended 31 October 2023

ENQUIRIES

Institutional investors and analysts:  Chris Hunt, Head of Shareholder Relations, ICG, +44 (0) 20 3545 2000
David Harris, Cadarn Capital,  +44 (0) 20 7019 9042
Media:  Cat Armstrong, Corporate Communications, ICG, +44 (0) 20 3545 1395

COMPANY TIMETABLE

A presentation for investors and analysts will be held at 10:00 UTC today. A link for the presentation can be found on the Results & Reports page of the Company website. A recording of the presentation will be made available on the Company website after the event.

ABOUT ICG ENTERPRISE TRUST

ICG Enterprise Trust is a leading listed private equity investor focused on creating long-term growth by delivering consistently strong returns through selectively investing in profitable, cash-generative private companies, primarily in Europe and the US.

We invest in companies directly as well as through funds managed by Intermediate Capital Group plc ("ICG") and other leading managers who focus on creating long-term value and building sustainable growth through active management and strategic change.

ICG Alternative Investment Limited, a regulated subsidiary of ICG, acts as the Manager of the Company.

NOTES
Included in this document are Alternative Performance Measures ("APMs”). APMs have been used if considered by the Board and the Manager to be the most relevant basis for shareholders in assessing the overall performance of the Company, and for comparing the performance of the Company to its peers and its previously reported results.

All performance figures are stated on a Total Return basis (i.e. including the effect of re-invested dividends).

DISCLAIMER
The information contained herein and on the pages that follow does not constitute an offer to sell, or the solicitation of an offer to acquire or subscribe for, any securities in any jurisdiction where such an offer or solicitation is unlawful or would impose any unfulfilled registration, qualification, publication or approval requirements on ICG Enterprise Trust PLC (the "Company") or its affiliates or agents. Equity securities in the Company have not been and will not be registered under the applicable securities laws of the United States, Australia, Canada, Japan or South Africa (each an "Excluded Jurisdiction”). The equity securities in the Company referred to herein and on the pages that follow may not be offered or sold within an Excluded Jurisdiction, or to any U.S. person ("U.S. Person") as defined in Regulation S under the U.S. Securities Act of 1933, as amended (the "U.S. Securities Act"), or to any national, resident or citizen of an Excluded Jurisdiction.

The information on the pages that follow may contain forward looking statements. Any statement other than a statement of historical fact is a forward looking statement. Actual results may differ materially from those expressed or implied by any forward looking statement. The Company does not undertake any obligation to update or revise any forward looking statements. You should not place undue reliance on any forward looking statement, which speaks only as of the date of its issuance.

MANAGER’S REVIEW

Our investment strategy

We focus on investing in buyouts of profitable, cash-generative businesses in developed markets that exhibit defensive growth characteristics which we believe will support strong and resilient returns across economic cycles.

We take an active approach to portfolio construction, with a flexible mandate that enables us to deploy capital in Primary, Direct and Secondary investments. Geographically we focus on the developed markets of North America and Europe, including the UK, which have deep and mature private equity markets supported by a robust corporate governance framework.

Investments managed by ICG accounted for 31% of the Portfolio.

Performance overview

• At 31 October 2023, the Portfolio was valued at £1,437m. The Portfolio Return on a Local Currency Basis for the quarter was 0.1% and in Sterling terms the Portfolio value grew by 3.4%
• The Portfolio generated £10m of cash during the quarter, comprised of £29m new investments and £39m proceeds
• ICG Enterprise Trust generated a NAV per Share Total Return of 3.3% during the quarter, ending the period with a NAV per Share of 1,959p
• Over the last five years ICG Enterprise Trust has generated an annualised NAV per Share Total Return of 15.4%

1. 93% of the Portfolio is valued using 30 September 2023 (or later) valuations.
   
   

Quoted company exposure

• We do not actively invest in publicly quoted companies but gain listed investment exposure when IPOs are used as a route to exit an investment. In these cases, exit timing typically lies with the manager with whom we have invested
• During the period Chewy and PetSmart were legally separated, which we believe will facilitate getting liquidity from these investments. The valuation impact of this transaction was minimal. As a result of this legal separation, our investment in the quoted company (Chewy, ticker: CHWY-US) is now shown separately from our investment in PetSmart
• At 31 October 2023, ICG Enterprise Trust’s exposure to quoted companies was valued at £72m, equivalent to 5.0% of the Portfolio value (31 July 2023: 6.9%). There was one quoted investment that individually accounted for 0.5% or more of the Portfolio value:
  
  

Realisation activity

• Total Realisation proceeds of £39m during the quarter
• Twelve Full Exits completed during the quarter, at a weighted average Uplift to Carrying Value of 33.7% and a 3.3x Multiple to Cost

New investment activity

• Total New Investments of £29m during the quarter, of which 17% (£5m) was alongside ICG
• The split of Total New Investments was split by category as follows:

• The £1m of direct investments were follow-on investments in existing portfolio companies
  
  

Commitments

• We made two new fund Commitments totalling £29m during the quarter:
  
  

• At 31 October 2023 we had Total Undrawn Commitments of £490m to funds in their investment period and a further £95m to funds outside their investment period

Liquidity

• Total available liquidity at 31 October 2023 was £154.2m (31 July 2023: £158.6m)

• The cash balance was £3.7m (31 July 2023: £24.0m) and drawn debt was £58.5m (31 July 2023: £72.9m). As a result, we had net debt of £54.8m (31 July 2023: £48.9m)
• At 31 October 2023 the Portfolio represented 108.8% of net assets (31 July 2023: 108.4%)
  
  

Dividend and share buyback

• Progressive dividend policy maintained: third quarter dividend of 8p per share (Q3 FY23: 7p)
• It remains the Board’s current intention to declare total dividends of at least 32p per share for the financial year ended 31 January 2024. This would represent an increase of 2p (6.7%) per share compared to the financial year ended 31 January 2023
• The following purchases have been made under the Company's long-term share buyback programme:
  
  

¹ Being the date the long-term share buyback programme was announced, up to and including 19 January 2024

Activity since the period end

Notable activity between 1 November 2023 and 31 December 2023 has included:

• Realisation Proceeds of £9m
• New investments of £28m
• As part of our active approach to managing our Portfolio, we executed a Secondary sale of certain investments that we expect to generate lower returns in the future than the rest of the Portfolio. The sale generated an attractive return of 1.8x invested cost, and gross cash proceeds of £68m that were received in December 2023. It also reduced our undrawn commitments by £9m. The sale was executed at a discount of 15.9%, which we estimate led to a reduction in our NAV per Share of approximately 1%. Pro-forma for this transaction at 31 October 2023 our NAV per Share would have been 1,937p (31 July 2023: 1,904p)
  
  

25 January 2024