IP Group news 0

Half-Year Highlights

Record cash realisations, strong financial position, positive developments in portfolio

Portfolio highlights

• Net portfolio gains of £34.9m or approximately +3% (HY19: reduction of £36.7m; FY19: reduction of £43.9m)
• Cash realisations of £113.7m (HY19: £7.1m; FY19; £79.5m), exceeding investment by £76.9m
• IP Group investment into portfolio: £36.9m (HY19: 39.0m; FY19: £64.7m)
• Total funds raised by portfolio companies in excess of £350m (HY19: £239m; FY19: £430m) including Featurespace (£30m) and Inivata ($25m), £200m of which was raised post-UK lockdown.
• Fair value of portfolio: £1,025.0m (HY19: £1,127.0m; FY19: £1,045.6m)
• Ceres Power valuation exceeded £1bn making it the second ‘unicorn’ to emerge from our portfolio; the resultant liquidity in the stock afforded the Group the opportunity to realise the majority of its investment at 7x cost
• Strong commercial progress at Oxford Nanopore, including development of LamPORE assay for the detection of SARS-CoV-2, and a total of £77.7m additional capital raised
• Inivata announced a strategic collaboration and $25m investment, plus an option to buy the company, from NeoGenomics
• Wave Optics exceeded its order forecasts in the first half of the year and now counts eight of the world’s top ten tech and social media companies as customers
• A number of our portfolio companies, most notably Oxford Nanopore, are involved in the response to COVID-19

Financial and operational highlights

• Hard NAV¹ £1,156.4m or 108.8 pence per share (HY19: £1,171.8m or 110.6p; FY19: £1,141.5m or 107.8 pence per share)
• Net assets £1,156.8m (HY19: £1,172.4m; FY19: £1,141.9m)
• Strong liquidity with gross cash and deposits at 30 June 2020 of £245.3m (HY19: £161.1m; FY19: £194.9m) and net cash (gross cash and deposits less EIB debt) of £170.5m
• (HY19: £71.0m; (FY19: £112.4m)
• Positive Return on Hard NAV² of £14.2m (HY19: negative £46.9m; FY19: negative £73.7m)
• Profit of £11.7m (HY19: loss of £49.5m; FY19: loss of £78.9m)

Post period-end update

• Total further cash realisations from the portfolio of £54.4m in July, total gross cash and deposits at 31 July 2020 of more than £275m
• Oxford Nanopore announces partnership with UK Government to roll out LamPORE, a new generation of COVID-19 test
• Appointment of Prof. Gordon Clark as Chair of Ethics Committee

Commenting on the Group’s half-yearly results, Alan Aubrey, Chief Executive Officer of IP Group, said:

“IP Group has made excellent progress in the first half of the year and beyond, achieving record realisations to the end of July of more than £168m, more than double the £79.5m achieved for the whole of 2019. The Group saw a positive return of approximately 3% on its portfolio in the first half, despite the significant headwinds and challenges faced globally. We will we continue this focus on NAV growth in the second half of the year and beyond.

We have adapted the Group’s day-to-day operations to ensure that our people have been able to continue to work effectively despite the COVID-19 pandemic and management has focussed on three core areas – the health and wellbeing of our people, supporting our portfolio of companies and maintaining business-as-usual virtually. I have great pride in the role that many of our portfolio companies are continuing to play in society’s response to COVID-19, further underlining the relevance and importance of the Group’s purpose.

The cash realisations from the portfolio, the positive portfolio return and continued prudent cost control have placed the Group in an even stronger, more liquid financial position than at the beginning of 2020. We remain confident in the prospects for our portfolio that, as well as financial returns, is delivering meaningful impact and significant benefits to society at large.”

¹ Hard NAV is defined as Total Equity, excluding Other Intangible Assets (see below).
² Return on Hard NAV is defined as the (loss)/profit for the period, excluding amortisation of intangible assets, share-based payment charge and IFRS3 charge in respect of acquisition of subsidiary (see below).

For more information, please contact:

IP Group plc	www.ipgroupplc.com
Alan Aubrey, Chief Executive Officer Greg Smith, Chief Financial Officer Liz Vaughan-Adams, Communications	+44 (0) 20 7444 0050
Charlotte Street Partners
Andrew Wilson David Gaffney	+44 (0) 7810 636995 +44 (0) 7854 609998

Further information on IP Group is available on our website: www.ipgroupplc.com

This Half-yearly Results Release may contain forward-looking statements. These statements reflect the Board’s current view, are subject to a number of material risks and uncertainties and could change in the future. Factors that could cause or contribute to such changes include, but are not limited to, the general economic climate and market conditions, as well as specific factors relating to the financial or commercial prospects or performance of individual portfolio companies within the Group’s portfolio of investments. Throughout this Half-yearly Results Release the Group’s holdings in portfolio companies reflect the undiluted beneficial equity interest excluding debt, unless otherwise explicitly stated.

Half-yearly results can be viewed in the PDF file format