25 April 2024
GCP Asset Backed Income Fund
Limited
(the
"Company" or "GCP Asset Backed")
LEI:
213800FBBZCQMP73A815
Annual Report and Accounts,
Quarterly Valuation and Proposed Orderly Realisation
Update
Net
Asset Value
GCP Asset Backed, which invests in
asset backed loans, announces that, at 31 March 2024, the unaudited
net asset value ("Q1 NAV") per ordinary share of the Company
(including current period revenue) is 91.25 pence per ordinary
share.
The Q1 NAV represents a decrease for
the quarter of 1.96 pence per ordinary share (2.11%) from 31
December 2023 predominantly as a result of impairments and
provisions proposed by the Company's independent valuation agent at
31 March 2024. The weighted average discount rate of the portfolio
at 31 March 2024 was 10.69%, representing an increase of 0.06% over
the quarter and 2.00% since 31 March 2023.
Further detail on the Q1 NAV
movements can be found on pages 20, 21 and 23 of the annual report
and financial statements for the year ended 31 December 2023 (the
"Annual Report and Accounts") (as referred to below).
Annual Report and Accounts
The Company is pleased to announce
the publication of its Annual Report and Accounts which are now
available on the Company website at: Gravis
| Literature (graviscapital.com) and will be posted to those shareholders who have elected to
receive hard copy documents shortly.
Highlights for the year
include:
· Dividends totalling 6.325 pence per ordinary share;
·
Total shareholder return of
-14.1%, total NAV return of 5.0% and an annualised total
shareholder return since IPO of 1.1%;
· Profit
of £18.3 million;
· Repayment of the Company's £50.0 million revolving credit
facility in full in December 2023, following the early prepayment
of loans;
· New
loans of £4.5 million advanced by the Group in the first quarter of
the year, with further investments of £28.2 million made to support
existing borrowers;
·
Exposure to a diversified,
partially inflation- and/or interest rate-protected portfolio of 42
asset backed loans with a third-party valuation of £362.8 million
at 31 December 2023;
· 8.5
million ordinary shares repurchased to support the Company's share
price, providing NAV accretion of 0.38 pence per ordinary share,
with 16.4 million ordinary shares repurchased since the start of
the buyback scheme in March 2020;
· Repayments of £93.5 million, generating repayment fees of £1.2
million;
· On
11 August 2023, the Company announced it had agreed heads of terms
with GCP Infrastructure Investments Limited in respect of a
proposed combination. Following significant shareholder
consultation, discussions ceased; and
· Post
year end in March 2024, following extensive shareholder
consultation, the Company announced the results of its Strategic
Review with the Board concluding that shareholder value will be
best served by winding down the Company with an orderly realisation
of its assets and return of capital. Shareholders will be given the
opportunity to vote on the discontinuation of the Company at the
forthcoming AGM (in respect of which, see below).
On
the release of the Annual Report and Accounts,
Alex Ohlsson,
Chairman of GABI, commented:
"Against a wider market background
of economic uncertainty and volatility, the Company continues to
offer investors exposure to a diversified portfolio of secured
loans. At the year end of 31 December 2023, the Group held 42 loans
with a fair valuation of £362.8 million and principal balance of
£374.6 million invested across the property, social infrastructure,
energy and asset finance sectors."
Dividends
The Board is pleased to announce a
quarterly dividend in respect of the period 1 January 2024 to 31
March 2024 of 1.58125 pence per ordinary share.
The ordinary shares will go
ex-dividend on 2 May 2024 and the dividend will be paid on 4 June
2024 to holders of ordinary shares recorded on the register at the
close of business on 3 May 2024.
On 8 February 2024, the Board
declared a quarterly dividend in respect of the period from 1
October 2023 to 31 December 2023 of 1.58125p per share, which was
paid on 15 March 2024. Aggregate dividend payments over the last
12-months represent a 9.3% yield on the Company's closing share
price at 23 April 2024.
Change to AGM and EGM date
The Board informs shareholders that
the previously announced date of the 2024 annual general meeting
("2024 AGM") and the 2024 extraordinary general meeting ("2024
EGM") to be held immediately after the 2024 AGM has changed to 20
May 2024. Notices convening the 2024 AGM and the 2024 EGM will be
published by the Company on or around 2 May 2024.
Proposed Orderly Realisation
As a result of the Company's
Strategic Review, which included a period of extensive engagement
with shareholders representing a majority of the total voting
rights in the Company, the Board announced on 14 March 2024 that it
had concluded that shareholder value will be best served by a
proposed managed-wind down of the Company with an orderly
realisation of the Company's assets and returns of capital over
time (the "Orderly Realisation").
At the 2024 AGM, shareholders will
be given the opportunity to vote on the discontinuation of the
Company which will be presented as an ordinary resolution requiring
the majority of those voting to vote in favour of discontinuation
in order for the resolution to pass (the "Discontinuation Vote").
The Board has recommended that shareholders vote for
discontinuation of the Company in its present form at the 2024
AGM.
In addition, subject to the approval
by shareholders of the Discontinuation Vote, the Board intends to
convene an EGM to be held immediately after the 2024 AGM at which
it will seek shareholder approval for certain resolutions required
to facilitate the Orderly Realisation (the "Proposals").
Subject to the Proposals being
approved by shareholders, it is the Board's expectation that the
Company will make a capital distribution of at least £55.0 million
as soon as is reasonably practicable following the conclusion of
the 2024 EGM. The Board will also seek to expedite capital
distributions when practicable thereafter.
The Orderly Realisation will not
result in a liquidation of the Company in the immediate future and
the Board will seek to implement the Orderly Realisation in a
manner that maximises value for shareholders.
Amounts realised are expected to
come from contractual repayments by borrowers to the Company as
loans mature in accordance with their contractual terms, and from
the disposal of portfolio assets, including longer-dated
loans.
Should the Proposals be approved by
shareholders, it is the Board's intention to maintain the Company's
existing level of dividend of 6.235 pence per annum whilst the
Company remains substantially invested, for as long as practicable.
This is a target only and does not constitute a
profit forecast.
The EGM Circular being published on
or around 2 May 2024 will contain further information, including an
updated portfolio repayment profile at 31 March 2024.
Alex Ohlsson, Chairman of the Company, further
commented:
"The Board would like to thank
shareholders for the constructive feedback provided as part of the
shareholder engagement process. The feedback has been invaluable in
informing the Board's decision-making process and in formulating
proposals for an Orderly Realisation of the Company."
For further information, please
contact:
GCP
Asset Backed Income Fund Limited
|
|
+44 (0)15 3482 2251
|
Alex Ohlsson
|
|
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Gravis Capital Management Ltd
|
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+44 (0)20 3405 8500
|
Philip Kent
|
|
|
Anthony Curl
|
|
|
Cameron Gardner
|
|
|
Barclays Bank PLC
|
|
+44 (0)20 7623 2323
|
Dion Di Miceli
|
|
|
Stuart Muress
|
|
|
James Atkinson
|
|
|
Buchanan/Quill
|
|
+44 (0)20 7466 5000
|
Helen Tarbet
|
|
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Sarah Gibbons-Cook
|
|
|
Henry Wilson
|
|
|
Notes to Editors
GCP Asset Backed is a closed ended
investment company. Its shares are traded on the Premium Segment of
the Main Market of the London Stock Exchange. Its investment
objective is to generate attractive risk-adjusted returns primarily
through regular, growing distributions and modest capital
appreciation over the long term.
The Company seeks to meet its
investment objective by making investments in a diversified
portfolio of predominantly UK based asset backed loans which are
secured against contracted, predictable medium to long term cash
flows and/or physical assets.