IP Group news 0

Net assets up to £526m, £100m raised, 70% increase in investment rate

IP Group plc (LSE: IPO), the developer of intellectual property-based businesses, today announces its annual results for the year ended 31 December 2014.

2014 Highlights

Positive progress against key strategic objectives

• Net assets increased to £526.2m (2013: £337.0m)
• 70% increase in capital provided to portfolio companies: £46.8m (2012: £27.5m)
• Portfolio of 90 companies (2013: 72)
• £100m (before expenses) raised through issue of new equity capital in February 2014
• Acquisition of Fusion IP plc completed and now fully integrated within the Group, bringing additional expertise and broader portfolio
• Further expansion into the US; now engaged with Princeton, Pennsylvania and Columbia universities.

Financial highlights

• Net assets excluding intangibles and the Oxford equity rights asset increased to £451.3m (2013: £315.5m)
• Net cash and deposits as at 31 December 2014: £97.3m (2013: £24.1m)
• Adjusted profit before tax of £16.2m (2013: £77.6m), excluding £6.7m reduction in fair value of Oxford Equity Rights asset and amortisation of intangible assets (2013: £5.0m)

Portfolio highlights

• Fair value of portfolio: £349.9m (2013: £285.9m)
• Portfolio realisations: £9.7m (2013: £5.5m)
• Group’s portfolio companies raised in excess of £200m in new capital (2013: £160m)
• Modern Biosciences agreed collaboration with Johnson & Johnson Innovation Centre and Janssen Biotech, Inc. potentially worth up to £176m plus royalties
• Oxford Nanopore Technologies Limited completed £35m private financing and launched heavily oversubscribed MinION Access Programme
• Diurnal Limited successfully completed phase II trials for the treatment of Congenital Adrenal Hyperplasia and raised £6m to support phase III trials
• Xeros Technology Group plc (“Xeros”), MedaPhor Group plc (“MedaPhor”) and Actual Experience plc (“Actual Experience”) admitted to AIM with Xeros and MedaPhor raising gross proceeds of £27.6m and £4.7m respectively and Actual Experience valued at £15.6m at the introduction price.

Post-year-end highlights

• Significantly oversubscribed proposed firm placing, placing and open offer to raise gross proceeds of £128m to help fuel the next phase of the Group’s growth

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

“Both the Group and its portfolio companies had a very active year in 2014. The equity fundraising in the first quarter of 2014, as well as that announced today, add further strength to the Group’s financial position and enable it to continue to significantly increase the rate of capital deployed into its portfolio companies. Furthermore, the Group has benefitted from the additional expertise and larger, more diversified portfolio that the acquisition of Fusion IP plc has brought to the business. Last year, we continued to expand into the US, through the formation of further partnerships, and we were delighted to complete our US first spin-out, from our partnership with the University of Pennsylvania, at the end of the year. The Group will continue to seek partnership and commercialisation opportunities both there and in the UK.

Overall, our portfolio companies progressed well in 2014 with Oxford Nanopore, Modern Biosciences and Diurnal in particular achieving important milestones. Xeros, MedaPhor and Actual Experience, which successfully floated on AIM, all contributed considerable positive fair value to the Group’s portfolio although the decline seen by that index over the year was also experienced by some of our quoted company holdings.

We continue to see a wealth of potentially disruptive intellectual property emanating from academic scientific research that we believe has the potential to form the basis of viable commercial businesses. The proposed capital raising, announced today, will add further impetus to the Group’s plans for growth as we maintain our focus on exploring these early-stage opportunities as well as supporting our portfolio companies with both human and financial capital. We remain confident that the Group will be able to deliver on its strategy of achieving attractive returns for its shareholders and funds’ limited partners over the long term.”

For more information, please contact:

IP Group plc – www.ipgroupplc.com Alan Aubrey, Chief Executive Officer Greg Smith, Chief Financial Officer Vicki Bradley, Communications	+44 (0) 20 7444 0050 +44 (0) 20 7444 0050 +44 (0) 20 7444 0050
FTI Consulting James Melville-Ross / Simon Conway / Victoria Foster Mitchell	+44 (0)20 3727 1000

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

Notes

(i) Nature of announcement

This Annual Results Release was approved by the directors on 9 March 2015.

The financial information set out in this Annual Results Release does not constitute the company's statutory accounts for 2014 or 2013. Statutory accounts for the years ended 31 December 2014 and 31 December 2013 have been reported on by the Independent Auditor. The Independent Auditor’s Reports on the Annual Report and Financial Statements for 2014 and 2013 were unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006. Statutory accounts for the year ended 31 December 2013 have been filed with the Registrar of Companies. The statutory accounts for the year ended 31 December 2014 will be delivered to the Registrar following the Company's annual general meeting.

The 2014 Annual Report and Accounts will be published in April 2015 and a copy will be posted on the Group's website (www.ipgroupplc.com). In accordance with Listing Rule 9.6.1 a copy of the Annual Report and Accounts will also be submitted to the National Storage Mechanism on or around this date and will be available for inspection at: www.Hemscott.com/nsm do from that time.

Throughout this Annual Results Release the Group’s holdings in portfolio companies reflect the undiluted beneficial equity interest excluding debt, unless otherwise explicitly stated.

(ii) Forward looking statements

This Annual Report and Accounts 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 which 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 companies within the Group’s portfolio.

Annual Results can be viewed in the PDF file format