IP Group news .

Significant progress in key portfolio companies, well financed, commitment to continued shareholder returns

IP Group plc (LSE: IPO), which develops world-changing science and technology businesses across life sciences, deeptech and cleantech, today announces its financial results for the six months ended 30 June 2022.

Half-year highlights

• Significant progress in key companies including fusion result at First Light Fusion, Istesso preparing to commence a Phase 2b trial for its lead drug MBS2320 in rheumatoid arthritis, and multiple upgrades to revenue projections at Oxford Nanopore
• Launch of dedicated cleantech platform Kiko Ventures to support transformative climate technology
• Strong balance sheet and liquidity to support follow-on investment in the portfolio with gross cash and deposits at 30 June 2022 of £235.7m (HY21: £308.9m; FY21: £321.9m)
• NAV¹ of £1,414.0m or 136.7 pence per share (HY21: £1,439.8m or 135.4 pence per share; FY21: £1,738.1m or 167.0pps)
• Loss of £309.8m (HY21: Profit of £116.5m; FY21: Profit of £449.3m), driven by reversal of gains on Oxford Nanopore reflecting public market declines for life science tools companies
• Profit of £35.6m excluding fair value movement on Oxford Nanopore (HY21: Profit of £116.5m; FY21: Profit of £152.3m)
• Our private portfolio company valuations remained robust with considerably more (92%) of our companies raising money in the current period at or above previous funding round valuations
• Interim dividend of 0.50p per share (HY21: 0.48pps; final dividend: 0.72pps); completion of £35m share buyback

Portfolio highlights

• Investment into portfolio: £52.0m into 22 companies across all our key thematic areas (HY21 £69.5m; FY21: £103.7m) including significant allocations into Istesso Ltd (£10m) and Bramble Energy Ltd (£9.5m)
• Total portfolio: £1,265.5m (HY21: £1,263.5m; FY21: £1,507.5m)
• Net portfolio loss of £291.1m (HY21: £140.4m gain; FY21: £499.2m gain), with quoted portfolio losses of £395.4m and private portfolio gains of £104.3m. Oxford Nanopore contributed a loss of £345.5m (HY21: nil, FY21: £297.1m gain)
• Total funds raised by portfolio companies: approximately £330m (HY21: c.£1.0bn; FY21: c.£2.4bn) including Nexeon (£60m), Microbiotica (£40m), MoA Technology (£35m) and Bramble Energy Ltd (£32m)
• Realisations of £2.1m, reflecting market conditions (HY21: £111.9m; FY21 £213.9m)

Post period-end update

• Agreement to issue long maturity private loan notes to UK institutional investors, making an additional £105m available for future drawdown for ESG investment to support portfolio companies and new investments
• The fair value of the Group’s holdings in listed companies experienced a net fair value increase of £30.2m in the period since 30^th June
• Hysata, our novel electrolyser business, completes AUD$43m round including AUD$19m from IP Group, to fund pilot plant

Greg Smith, Chief Executive of IP Group, said: “I am pleased to report strong progress in the first half of the year in our leading private portfolio companies. First Light Fusion achieved a world-first fusion result which was externally validated by the UK Atomic Energy Authority and we anticipate that Istesso’s Phase 2b study in rheumatoid arthritis for its lead drug MBS2320 will start shortly. Our deepening thematic focus was demonstrated by the launch of our dedicated cleantech platform, Kiko Ventures.

Having acted to ensure that the Group has a strong level of liquidity, IP Group ended the period with gross Cash of £235.7m. This financial strength enabled the Group to continue to invest into our leading companies over the period as well as continuing to return a proportion of all exits to shareholders via dividends and share buybacks. In addition, we have arranged a private market debt issue to provide additional funding flexibility in what may be difficult market conditions.

The Group, including Parkwalk, is one of the largest investors in university and other research-based companies in the world and has both a maturing portfolio and an exciting pipeline of opportunities. While the Group continues to plan for reduced realisations this year, given the current market backdrop which has resulted in a first half loss, we continue to believe that the prospects for our portfolio are compelling. Given our strong cash and credit facilities, maturing portfolio and deep sector expertise, IP Group is well placed to navigate the current economic and geopolitical conditions and generate significant returns to shareholders.”

Webinar 
IP Group will host a webinar for analysts and investors today, 10:00 GMT. For more details or to register as a participant please visit www.ipgroupplc.com/events.

For more information, please contact:

IP Group plc	www.ipgroupplc.com
Greg Smith, Chief Executive Officer David Baynes, Chief Financial & Operating Officer Liz Vaughan-Adams, Communications	+44 (0) 20 7444 0050   +44 (0) 20 7444 0062/+44 (0) 7979 853802
Charlotte Street Partners
David Gaffney Andrew Wilson	+44 (0)  7854 609998 +44 (0) 7810 636995

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

This half-yearly report 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 Report 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.