RNS Number : 0930J

Apax Global Alpha Limited

19 August 2021


Apax Global Alpha Limited

Interim results for the period ended 30 June 2021

Key highlights

 --   Strong performance across the portfolio in the first six months 
       of 2021: AGA's Total NAV Return(1) was 17.4% (14.9% constant 
 --   Total Adjusted NAV increased to c. EUR 1.4bn with Adjusted NAV 
       per share increasing from EUR2.45 (GBP2.19) to EUR2.81 (GBP2.41) 
       in the six months to 30 June 2021. 
 --   Focus on four target sectors and a "good-to-great" strategy 
       of business improvement in Private Equity driving strong returns 
       in the portfolio. 
 --   The Apax Funds were able to identify attractive opportunities 
       to invest, with AGA deploying EUR85m across eleven new Private 
       Equity investments (seven in Apax X, two in the Apax Digital 
       Fund, one in the AMI Opportunities Fund, and one joint investment 
       by the AMI Opportunities Fund and the Apax Digital Fund). 
 --   Record distributions of EUR131.1m received from full and significant 
       partial Private Equity exits, deployed into 13 new Derived Debt 
       positions to absorb liquidity in the fund into attractive yield 
 --   New commitment of $90m to the Apax Digital Fund II, the successor 
       fund to the Apax Digital Fund which invests in minority equity 
       and growth buyout opportunities in mid-market technology companies. 
 --   Liquidity position is healthy with available cash after net 
       liabilities of EUR29m, and undrawn evergreen revolving credit 
       facility of EUR140m. Derived Investments of EUR439m(3) provide 
       a further source of funding for AGA. 
 --   Interim dividend of 5.97 pence per share declared, in line with 
       the stated policy to distribute 5% of NAV p.a. 

Tim Breedon CBE, Chairman of Apax Global Alpha, said:

"The focus on global opportunities and sectors that continue to show strong structural growth has delivered good results in the first half of the year. AGA's portfolio is now mature with the Private Equity portfolio diversified across fund vintages and generating substantial cash distributions. As the Covid-19 vaccine rollout continues and global economies further rebound, AGA is well positioned to continue to provide long-term value and attractive income for shareholders."

Commenting on the results, Ralf Gruss, COO of Apax Partners, said:

"AGA's strong NAV performance in the first six months reflects the quality of the portfolio. There is good momentum as seen through several successful realisations with good uplifts, and there was a good pace of deployment, with new investments in both Private Equity and Derived Debt. There is a strong pipeline of new investments, and AGA is well positioned for emerging opportunities."

Financial highlights

 --   Significant growth in Adjusted NAV(3) to just under EUR1.4 
       billion, up from EUR1.2 billion as at 31 December 2020, despite 
       dividend payment of 5.28 pence per share during the first 
 --   Portfolio weighted towards Private Equity (68%), vs. Derived 
       Debt (29%) and Derived Equity (3%). 
 --   Reflecting the strong investment pace in Q2, AGA was 98% 
       invested as at 30 June 2021 and had outstanding commitments 
       to the Apax Funds (together with recallable distributions) 
       of EUR419m. 
                        H1 2021 (EUR)   H1 2021 (GBP) 
 Adjusted NAV (3)       EUR 1,380m      GBP 1,183m 
                       --------------  -------------- 
 Adjusted NAV (3) per   EUR 2.81        GBP 2.41 
                       --------------  -------------- 
 NAV (3) per share      EUR 2.82        GBP 2.42 
                       --------------  -------------- 
                        Exposure   H1 2021        H1 2021 
                                              constant currency 
 Total NAV Return(1)                17.4%          14.9% 
                       ---------  --------  ------------------- 
 Total Return(1) - 
  Private Equity          66%       24.5%          21.9% 
                       ---------  --------  ------------------- 
 Total Return(1) - 
  Derived Debt            29%       7.3%            4.5% 
                       ---------  --------  ------------------- 
 Total Return(1) - 
  Derived Equity           3%       28.6%          25.0% 
                       ---------  --------  ------------------- 
 Cash & Others             2% 
                       ---------  --------  ------------------- 

Private Equity portfolio highlights

 --   The Private Equity portfolio performed strongly in the first 
       six months of 2021: Total Return(1) of 24.5% (21.9% constant 
 --   Deal activity reflective of Apax's 'good to great' investment 
       strategy and sub-sector expertise, focusing on opportunities 
       where there is a significant re-rating at exit based on business 
       quality improvement. 
 --   Aggregate Gross IRR(4) and Gross MOIC(4) on Private Equity 
       exits in H1 2021, excluding the InnovAge and Global-e IPOs 
       (primary only), were 52.4% and 3.9x respectively. Exits were 
       achieved at an average uplift(2) of 25.7%, reflecting the quality 
       of the portfolio. 
 --   On a look-through basis, AGA invested c.EUR85m(5) in eleven 
       new investments that closed during the period. 
 --   Continued strong earnings growth and operating performance 
       from the portfolio companies: LTM Revenue(6) and EBITDA growth(6) 
       of 22.3% and 42.7% respectively across the Private Equity portfolio. 

Derived Investments portfolio highlights

 --   Good performance across the portfolio with Derived Investments 
       achieving a Total Return(1) of 9.8% (7.0% constant currency) 
       in H1 2021, driven by performance in Derived Debt which makes 
       up 88% of the Derived Investments portfolio, with a Total 
       Return(1) of 7.3% (4.5% constant currency). 
 --   In Derived Debt the focus remained on investments in lower 
       risk first and second lien loans where there is a high degree 
       of visibility on cash flow, and in target sub-sectors where 
       Apax has unique insights gained from the Private Equity investment 
       activity - EUR161.3m deployed across 13 new debt positions 
       in H1 2021. 
 --   Strong operating performance from underlying Derived Debt 
       portfolio companies: LTM EBITDA growth from 26.2% to 37.3% 
       in the six months to 30 June 2021. 
 --   Reflecting the increased share of first lien loans and the 
       impact of lower base rates in the portfolio, the overall yield 
       to maturity of the portfolio reduced to 6.8% at 30 June 2021. 
 --   Derived Equity delivered Total Return(1) of 28.6% (25.0% constant 
       currency) in the first six months of 2021. 

For further information regarding the announcement of AGA's 2021 interim results, including the Company's interim report, results presentation and dial-in details for today's analyst and investor webcast at 9.30am (UK time), please visit www.apaxglobalalpha.com .

Contact details

  Katarina Sallerfors 
    Investor Relations - AGA 
   Telephone: +44 (0)207 666 6526 
   Email: katarina.sallerfors@apax.com 


Movements in NAV

 Adjusted NAV(3) movements    Private     Derived                Treasury   Facility            H1 2021 
  (EURm)                       Equity    Investments    Cash      Shares      drawn    Other     Total 
                             --------  -------------  --------  ---------  ---------  -------  -------- 
 Adjusted NAV at 31.12.20       788.3          319.4     124.6          -          -   (31.1)   1,201.2 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 + Investments                   78.7          161.3   (218.6)          -          -   (21.4)         - 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 - Distributions/ 
  divestments                 (131.1)         (69.8)     196.8          -          -      4.1         - 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 + Interest and dividend 
  income                            -              -       9.4          -          -      0.4       9.8 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 +/- Gains/(losses)             161.0           17.8         -          -          -        -     178.8 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 +/- FX gains/(losses)(7)        19.7           10.5       0.2          -          -        -      30.4 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 +/- Costs and other 
  movements                         -              -     (4.0)          -          -    (1.4)     (5.4) 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
  - Dividends paid                  -              -    (30.0)          -          -        -    (30.0) 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 +/- Performance fee 
  reserve                           -          (4.5)         -          -          -        -     (4.5) 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 +/- Treasury shares                -              -         -          -          -        -         - 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 +/- Revolving credit                                                   -          -        - 
  drawn/repaid                      -              -         -                                        - 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 
 Adjusted NAV at 
  30.6.21 (3)                   916.6          434.7      78.4          -          -   (49.4)   1,380.3 
---------------------------  --------  -------------  --------  ---------  ---------  -------  -------- 

Private Equity - operational metrics

Private Equity - operational metrics                30 June 2021  31 December 2020 
Portfolio year-over-year LTM revenue growth(6)             22.3%              6.6% 
================================================  ==============  ================ 
Portfolio year-over-year LTM EBITDA growth(6)              42.7%             20.8% 
================================================  ==============  ================ 
Enterprise Value / EBITDA valuation multiple(6)            18.0x             16.9x 
================================================  ==============  ================ 
Net debt / EBITDA multiple (6)                              3.7x              3.9x 
------------------------------------------------  --------------  ---------------- 

Derived Investments - operational metrics

Derived Investments - operational metrics    30 June 2021  31 December 2020 
Debt year-over-year LTM EBITDA growth(8)            37.3%             26.2% 
===========================================  ============  ================ 
Debt average income yield to maturity(8)             6.8%              8.1% 
===========================================  ============  ================ 
Debt average years to maturity                        5.9               5.7 
===========================================  ============  ================ 
Debt average income yield(9)                         6.4%              7.3% 
-------------------------------------------  ------------  ---------------- 

Other Invested Portfolio highlights

Invested Portfolio analysis(10)    EURm     EURm    %     % 
                                  -----  -------  --- 
Private Equity                             916.6        68% 
================================  =====  =======  ===  ==== 
  *    AMI                         50.0            4% 
================================  =====  =======  ===  ==== 
  *    AEVI                         6.6            0% 
================================  =====  =======  ===  ==== 
  *    AEVII                       26.2            2% 
================================  =====  =======  ===  ==== 
  *    AVIII                      172.2           13% 
================================  =====  =======  ===  ==== 
  *    AIX                        522.6           38% 
================================  =====  =======  ===  ==== 
  *    ADF                         35.3            3% 
================================  =====  =======  ===  ==== 
  *    AX                         103.7            8% 
================================  =====  =======  ===  ==== 
Derived Investments                        439.2        32% 
================================  =====  =======  ===  ==== 
  *    Derived Debt               388.6           29% 
================================  =====  =======  ===  ==== 
  *    Derived Equity              50.6            3% 
================================  =====  =======  ===  ==== 
Total                                    1,355.8       100% 
--------------------------------  -----  -------  ---  ---- 


   1.    "Total NAV Return" means the movement in the Adjusted NAV 
          per share over the period plus any dividends paid. "Total 
          Return" reflects the sub-portfolio performance on a stand-alone 
          basis. It excludes items at the overall AGA level such as 
          cash, management fees, and costs 
   2.    Valuation uplifts on exits are calculated based on the total 
          actual or estimated sales proceeds and income as appropriate 
          since the last Unaffected Valuation. Unaffected Valuation 
          is determined as the fair value in the last quarter before 
          exit, when valuation is not affected by the exit process 
          (i.e. because an exit was signed, or an exit was sufficiently 
          close to being signed that the Apax Funds incorporated the 
          expected exit multiple into the quarter end valuation). 
          Average uplift of full exits and significant partial exits 
          in the current period calculated based on the expected sales 
          proceeds and/ or the fair value remaining. For investments 
          where there were subsequent partial realisations since December 
          2020, uplift calculated by taking proceeds received in H1 
          2021 plus remaining fair value at 30 June 2021 compared 
          to fair value at 31 December 2020 
   3.    NAV was EUR1,384.8m whilst Adjusted NAV was EUR1,380.3m 
          reflecting the estimated performance fee reserve of EUR4.5m 
          at period end. Private Equity NAV and Adjusted NAV were 
          the same at EUR916.6m. Derived Investments NAV was EUR439.2m 
          whilst it's Adjusted NAV was EUR434.7m reflecting the adjustment 
          for the performance fee reserve of EUR4.5m. 
   4.    Private Equity Aggregate Gross IRR and Gross MOIC of 52.4% 
          and 3.9x calculated based on the expected aggregate cash 
          flows across all funds for the 12 full or significant partial 
          exits or IPOs 
   5.    Invested cost remains subject to closing on investments 
          signed which have yet to close 
   6.    Gross Asset Value weighted average of the respective metric 
          across the portfolio. LTM Revenue growth and LTM EBITDA 
          growth rates exclude companies where EBITDA is not meaningful 
          such as financial services or high growth business with 
          fluctuations in EBITDA. TietoEVRY is also excluded due to 
          the unavailability of reported data. Net debt/EBITDA multiple 
          and EV/EBITDA valuation multiple excluded companies where 
          EBITDA is not meaningful such as financial services or companies 
          with negative EBITDA, or high growth business valued on 
          a revenue basis. MATCHESFASHION.COM is excluded due to low 
          EBITDA from opex investments and short-term fluctuations 
          in EBITDA. Cole Haan has been excluded at June 2021 as it 
          has negative EBITDA 
   7.    FX on cash includes the revaluation of cash balances and 
          net losses arising from the differences in exchange rates 
          between transaction dates and settlement dates, and unrealised 
          net losses arising from the translation into euro of assets 
          and liabilities (other than investments) which are not denominated 
          in euro 
   8.    Gross Asset Value weighted average of the respective metric 
          across the Derived Debt portfolio 
   9.    Gross Asset Value weighted average of the current full year 
          income (annual coupon/clean price as at the respective date) 
          for each debt position in the Derived Debt portfolio as 
          at the respective date 
   10.   Invested Portfolio excludes cash and cash equivalents, revolving 
          credit facility drawn and net current assets, including 
          these the NAV was EUR1,384.8m and Adjusted NAV was EUR1,380.3m 
          reflecting adjustment of EUR4.5m for the estimated performance 
          fee reserve accrued 


 1.   Note that references in this announcement to Apax Global Alpha 
       Limited have been abbreviated to "AGA" or "the Company". References 
       to Apax Partners LLP have been abbreviated to "Apax Partners" 
       or "the Investment Adviser" 
 2.   Please be advised that this announcement may contain inside 
       information as stipulated under the Market Abuse Regulations 
       (EU) NO. 596/2014 ("MAR") 
 3.   This announcement is not for release, publication or distribution, 
       directly or indirectly, in whole or in part, into or within 
       the United States or to "US persons" (as defined in Regulation 
       S under the United States Securities Act of 1933, as amended 
       (the "Securities Act")) or into or within Australia, Canada, 
       South Africa or Japan. Recipients of this announcement in jurisdictions 
       outside the UK should inform themselves about and observe any 
       applicable legal requirements in their jurisdictions. In particular, 
       the distribution of the announcement may be restricted by law 
       in certain jurisdictions 
 4.   The information presented herein is not an offer for sale within 
       the United States of any equity shares or other securities 
       of Apax Global Alpha Limited ("AGA"). AGA has not been and 
       will not be registered under the US Investment Company Act 
       of 1940, as amended (the "Investment Company Act"). In addition, 
       AGA's shares (the "Shares") have not been and will not be registered 
       under the Securities Act or any other applicable law of the 
       United States. Consequently, the Shares may not be offered 
       or sold or otherwise transferred within the United States, 
       or to, or for the account or benefit of, US Persons, except 
       pursuant to an exemption from the registration requirements 
       of the Securities Act and under circumstances which will not 
       require AGA to register under the Investment Company Act. No 
       public offering of the Shares is being made in the United States 
 5.   This announcement may include forward-looking statements. The 
       words "expect", "anticipate", "intends", "plan", "estimate", 
       "aim", "forecast", "project" and similar expressions (or their 
       negative) identify certain of these forward-looking statements. 
       These forward-looking statements are statements regarding AGA's 
       intentions, beliefs or current expectations concerning, among 
       other things, AGA's results of operations, financial condition, 
       liquidity, prospects, growth and strategies. The forward-looking 
       statements in this presentation are based on numerous assumptions 
       regarding AGA's present and future business strategies and 
       the environment in which AGA will operate in the future. Forward-looking 
       statements involve inherent known and unknown risks, uncertainties 
       and contingencies because they relate to events and depend 
       on circumstances that may or may not occur in the future and 
       may cause the actual results, performance or achievements of 
       AGA to be materially different from those expressed or implied 
       by such forward looking statements. Many of these risks and 
       uncertainties relate to factors that are beyond AGA's ability 
       to control or estimate precisely, such as future market conditions, 
       currency fluctuations, the behaviour of other market participants, 
       the actions of regulators and other factors such as AGA's ability 
       to continue to obtain financing to meet its liquidity needs, 
       changes in the political, social and regulatory framework in 
       which AGA operates or in economic or technological trends or 
       conditions. Past performance should not be taken as an indication 
       or guarantee of future results, and no representation or warranty, 
       express or implied, is made regarding future performance. AGA 
       expressly disclaims any obligation or undertaking to release 
       any updates or revisions to these forward-looking statements 
       to reflect any change in AGA's expectations with regard thereto 
       or any change in events, conditions or circumstances on which 
       any statement is based after the date of this announcement, 
       or to update or to keep current any other information contained 
       in this announcement. Accordingly, undue reliance should not 
       be placed on the forward-looking statements, which speak only 
       as of the date of this announcement. 

About Apax Global Alpha Limited

AGA is a Guernsey registered closed-ended collective investment scheme incorporated as a non-cellular company that listed on the London Stock Exchange on 15 June 2015. It is regulated by the Guernsey Financial Services Commission.

AGA's objective is to provide shareholders with capital appreciation from its investment portfolio and regular dividends. The Company is targeting an annualised Total Return, across economic cycles, of 12-15% (net of fees and expenses) including a dividend yield of 5% of Net Asset Value.

The investment policy of the Company is to make Private Equity investments in Apax Funds, and Derived Investments which are investments in equities and debt derived from the insights gained via Apax Partners' Private Equity activities.

Further information regarding the Company and its publications are available on the Company's website at www.apaxglobalalpha.com.

About Apax Partners LLP

Apax Partners LLP ("Apax") is a leading global private equity advisory firm. For nearly 50 years, Apax has worked to inspire growth and ideas that transform businesses. The firm has raised and advised funds with aggregate commitments of more than $60 billion. The Apax Funds invest in companies across four global sectors of Tech, Services, Healthcare, and Internet/Consumer. These funds provide long-term equity financing to build and strengthen world-class companies. For further information about Apax, please visit www.apax.com.

Apax Partners is authorised and regulated by the Financial Conduct Authority in the UK.

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