TIDMOCI
RNS Number : 8924L
Oakley Capital Investments Limited
11 September 2019
11 September 2019
Oakley Capital Investments Limited
Interim Results for the Six Months ended 30 June 2019
Earnings growth across portfolio and deal activity driving
industry-leading returns
Oakley Capital Investments Limited(1) (the "Company" or "OCI")
today announces its interim results for the six months ended 30
June 2019.
FINANCIAL HIGHLIGHTS
-- NAV per share of GBP3.18 and NAV of GBP651 million
-- Total NAV return of 14% since 31 December 2018 and 23% since 30 June 2018
-- Total shareholder return of 33%
-- GBP38 million invested in Oakley Fund acquisitions
-- GBP57 million of proceeds returned from the Oakley Funds
-- 2019 interim dividend of 2.25 pence per share, to be paid on 24 October 2019 to shareholders on the register on
27 September 2019
PORTFOLIO HIGHLIGHTS
-- Fair value of the underlying portfolio companies grew by 25% on a like-for-like basis
-- Average portfolio company year-on-year EBITDA growth of 31%
-- Average portfolio company valuation multiple (EV/EBITDA) of 12.0x and net debt to EBITDA ratio of 4.1x
-- Positive revaluations across the Oakley Funds and co-investments, driven by continued strong performance from
portfolio companies. Two notable contributors were Inspired, with a partial sale at an 80% premium to the book
value as at 31 December 2018, and Time Out, whose share price increased 60% over the period
REALISATIONS AND DISTRIBUTIONS
-- Inspired - a partial sell-down returned GBP30 million to OCI
-- Career Partner Group and WebPros - refinanced in the period, returning GBP27 million
INVESTMENTS
-- Two investments completed during the period: Ekon and Seagull & Videotel. OCI's total indirect contribution
through its interest in the Oakley Funds was GBP38 million
-- Three further investments have been signed but not completed since the beginning of the year, in which OCI is
expected to invest GBP47 million via the Oakley Funds: Rastreator & Acierto, Alessi and Seven Miles
-- The five investments are expected to be made at an average EV/EBITDA multiple of 11.2x versus peer group
comparable multiples of 13.4x
-- Co-investment debt of GBP19 million provided to North Sails, funding the relaunch of North Kiteboarding,
including the acquisition of kiteboarding accessories brand Mystic, and increased marketing spend for North Sails
Apparel
FUND UPDATE
-- Fund IV - Held a final close on EUR1.46 billion in June 2019, including an OCI commitment of EUR400 million.
First investments signed: Seagull & Videotel and Seven Miles
-- Fund III - Alessi is the tenth and final platform investment in the Fund, which is now c.80% invested
COMPANY UPDATE
-- Outstanding commitments to the Oakley Funds amount to GBP502 million (77% of NAV) with funding sources of GBP651
million. Funding sources comprise equity investments of GBP430 million, debt investments of GBP125 million and
net cash of GBP96 million
-- Corporate governance measures undertaken include the buy-back of shares for cancellation, the move to the
Specialist Fund Segment of the LSE's Main Market and the appointment of independent director Craig Bodenstab to
the board
Caroline Foulger, Chair Oakley Capital Investments Limited,
commented:
"Continued strong portfolio company performance and exits above
book value have delivered a 12-month total NAV return for OCI of
23%, well ahead of the wider market. We are pleased that the
ongoing enhancement of the Company's governance, in combination
with these returns, has been reflected in the share price, with a
total shareholder return of 33% in the period."
Peter Dubens, Managing Partner Oakley Capital Limited,
commented:
"It has been a positive start to the year for OCI and the Oakley
Funds. The portfolio companies have grown EBITDA 31%, a partial
exit was achieved at 80% above book value, and five new investments
have been signed. The prospects of these high-quality companies and
the attractive valuations at which they were acquired continue to
demonstrate the repeatability of Oakley's unique sourcing
model."
Please refer to the Company's website for the Half-Year Report
and Accounts
http://oakleycapitalinvestments.com/investor-centre/publications
- ends -
For further information please contact:
Oakley Capital Investments Limited
+44 20 7766 6900
Steven Tredget, Investor Relations
Greenbrook Communications Ltd
+44 20 7952 2000
Alex Jones / Matthew Goodman / Gina Bell
Liberum Capital Limited (Financial Adviser & Broker)
+44 20 3100 2000
Steve Pearce / Gillian Martin / Owen Matthews
Notes:
LEI Number: 213800KW6MZUK12CQ815
(1) About Oakley Capital Investments Limited ("OCI")
OCI is a Specialist Fund Segment ("SFS") traded investment
vehicle, which provides access to the Oakley Funds(2) . It is a
liquid vehicle that aims to provide capital growth and dividends to
investors.
(2) The Oakley Funds
Oakley Capital Private Equity L.P. and its successor funds,
Oakley Capital Private Equity II, Oakley Capital III and Oakley
Capital IV, are unlisted focused mid-market private equity funds
with the aim of providing investors with significant long-term
capital appreciation. The investment strategy of the funds is to
focus on buy-out opportunities in industries with the potential for
growth, consolidation and performance improvement.
The Investment Adviser
Founded in 2002, Oakley Capital Limited has demonstrated the
repeated ability to source attractive growth assets at attractive
prices. To do this it relies on its sector and regional expertise,
its ability to tackle transaction complexity and its
deal-generating entrepreneur network.
Important information
Specialist Fund Segment securities are not admitted to the
Official List of the Financial Conduct Authority. Therefore, the
Company has not been required to satisfy the eligibility criteria
for admission to listing on the Official List and is not required
to comply with the Financial Conduct Authority's Listing Rules. The
London Stock Exchange has not examined or approved the contents of
the Prospectus.
The Specialist Fund Segment is intended for institutional,
professional, professionally advised and knowledgeable investors
who understand, or who have been advised of, the potential risk
from investing in companies admitted to the Specialist Fund
Segment.
Chair's statement
Strong portfolio company performance and exits above book value
once again drive double digit returns for shareholders
The Board is pleased to report another period of strong returns,
with an increase in net asset value (NAV) of 13% in the first half
of 2019. Our NAV reached a record high of GBP651 million (318 pence
per share) at 30 June, driven by continued strong performance from
the Funds' portfolio companies and realisations above book
value.
We have also continued the enhancement of the Company's
governance, which in combination with returns well ahead of the
wider market, has had a positive impact on the share price, with a
total shareholder return of 33% in the period.
Revaluations, realisations and investments
There have been positive revaluations across the Oakley Funds.
The two notable contributors to NAV growth were Inspired, due to a
partial sell-down at 80% premium to book value, and Time Out, where
the share price increased 60% in the period. The impact to OCI of
both Inspired and Time Out was enhanced by the equity co-investment
stakes held in both companies. There has also been a GBP19m
increase in the co-investment debt provided to North Sails.
The Oakley Funds returned GBP57 million in cash to OCI in the
first half of 2019. Our share of proceeds from the Fund II partial
sell-down of Inspired was GBP30 million and we also benefited from
the refinancings of the Fund III holdings of Career Partner Group
and WebPros, which together returned GBP27 million.
The Investment Adviser, Oakley Capital, continues to demonstrate
its ability to source high quality investments at attractive
valuations. In the period, Oakley completed the acquisitions of
Ekon (TMT) and Seagull & Videotel (Education) at an investment
cost to OCI of GBP38 million and signed Rastreator & Acierto
(Consumer), Alessi (Consumer) and Seven Miles (Consumer), at a
further estimated cost to OCI of GBP47 million. Each of these
companies demonstrates characteristics typical of an Oakley
investment, as they are leaders in industries enjoying structural
growth, with recurring revenues across large and diversified
customer bases.
Private Equity
There is concern around the abundance of dry powder within PE
funds, increasing valuations and the dangers of high leverage.
However, we believe that the industry's superior returns and
ability to deploy capital are currently sustainable, thanks to the
increasing pool of investable private companies, in contrast to
continued public market consolidation.
The investment successes that have continued over this six-month
period underline our confidence in the repeatability of Oakley's
approach, which combines sector expertise with a strong network of
operating partners who use their knowledge to uncover growth
opportunities and ultimately deliver industry-leading returns.
Governance
The Board has continued to introduce changes to enhance and
protect shareholder value. These include the buy-back of shares for
cancellation; the move to the Specialist Fund Segment of the London
Stock Exchange's Main Market; increased marketing; and the launch
of new investor tools.
These changes are part of an ongoing process to ensure OCI
achieves best-in-class transparency and governance. We are
encouraged to see this contributing to the narrowing of the
discount to NAV at which the shares currently trade.
Board changes
The Board is undergoing a period of measured refreshment, adding
independent members with diverse perspectives and deep expertise to
support the continuing development of an established yet
fast-growing investment company. I am, therefore, pleased to
welcome Craig Bodenstab, a Chartered Financial Analyst and
qualified accountant with over 25 years' investment management
experience, to the Board and we look forward to benefiting from his
considerable knowledge and expertise. We anticipate making further
changes to the Board during the next year.
Prospects
The Board, the Company and our Investment Adviser remain acutely
aware of the current uncertainty in the geopolitical landscape and
global economic outlook. However, we remain confident that the
composition of our assets is reflective of a prudent and dynamic
investment strategy that will continue to create sustainable value.
This confidence is underpinned by OCI's long-term, strong and
consistent performance, demonstrated by a ten-year NAV compound
growth rate of 16%.
Caroline Foulger
Chair
Market overview
Private equity activity remains high with further growth
expected as the asset class continues to outperform
What is the impact of record levels of cash within private
equity and is it expected to grow even further?
Although private equity funds' available capital - or "dry
powder" - stands at c.$2.2 trillion (source: Preqin), an all-time
high, the number of investment opportunities has kept pace with
fund growth. The time taken to deploy capital has remained at its
ten-year average of 2.8 years. Private equity is expected to
continue to attract significant inflows while it outperforms most
other asset classes.
The competition for certain assets has increased, pushing
valuations higher. The average EV/EBITDA multiple is set to exceed
the record levels reached in 2018. Despite this backdrop, Oakley
has continued to secure high-quality assets at attractive
valuations. This year, Oakley has signed five deals at an average
EV/EBITDA multiple of 11.2x versus peer group comparable ratings of
13.4x.
How important is low cost and easily accessible debt to private
equity and are levels of leverage a concern?
Deal activity continues to be stimulated by the low interest
rate environment. The value of global leveraged buyouts climbed to
$256 billion in the first six months of 2019 (source: Refinitiv),
whilst average levels of Private Equity portfolio leverage have
exceeded 6x Net Debt/EBTIDA (Source: Bain and Company). This has
led to concerns over whether such debt levels can continue to be
serviced in a weaker economic environment.
Oakley takes a disciplined approach to debt, with the underlying
portfolio currently levered at an average multiple of 4.1x at the
half year. This degree of leverage is appropriate considering the
projected earnings growth, low capex and cash generative profile of
the Oakley portfolio.
Is the uncertain political and economic environment an
opportunity or a threat?
In light of global economic uncertainty, Oakley has approached
investing with caution. It has sought companies that offer growth
through innovation and structural change and that demonstrate a
resilience to broader economic weakness.
The successful launch of Oakley Fund IV this year is timely, in
that it is well positioned to take advantage of investment
opportunities that may result from economic or political
dislocations.
OCI NAV overview
During the period, OCI's NAV increased by GBP76.1 million to
GBP650.9 million, an increase of 13% since 31 December 2018.
6 months ended 12 months ended
30 Jun 2019 31 Dec 2018
GBPm GBPm
Opening net asset value at the
start of the period 574.8 502.0
-------------- ---------------
Gross revenue 4.5 6.8
-------------- ---------------
Net expenses (12.6) (6.4)
-------------- ---------------
Net foreign currency (losses)/gains (0.3) 3.2
-------------- ---------------
Realised gains on investments 17.8 102.3
-------------- ---------------
Net change in unrealised appreciation
on investments 72.1 (23.9)
-------------- ---------------
Shares purchased and cancelled (0.8) -
-------------- ---------------
Dividend expense (4.6) (9.2)
-------------- ---------------
Closing net asset value at the
end of the period 650.9 574.8
-------------- ---------------
Number of shares in issue 204.4 204.8
-------------- ---------------
NAV per share GBP3.18 GBP2.81
-------------- ---------------
Net earnings were GBP81.5 million for the six months,
comprising:
-- Gross revenue of GBP4.5 million arising from interest income
earned on the debt facilities provided by the Company.
-- Net expenses of GBP13.2 million offset by GBP0.5 million of
other income earned by the Company. Expenses includes fees paid to
the Administrative Agent and the Investment Adviser.
-- Realised gains of GBP17.8 million earned from the partial
realisation of Inspired that occurred in Oakley Fund II in the
period. Net change in unrealised gains of GBP72.1 million, driven
predominantly by the uplift in the valuation in the Company's
direct investment in Inspired and Time Out and of the uplift of
those and other portfolio companies in the Oakley Funds.
A final dividend for the year ended 31 December 2018 of 2.25
pence per share, totalling GBP4.6 million, was paid to shareholders
in April 2019.
OCI investment activity
The transactional activity for the Company's investment
portfolio for the period is summarised below:
30 Jun 2019 31 Dec 2018
Fair value Fair value
Investment GBPm GBPm
Investment in Oakley Funds 319.5 298.6
------------ ------------
319.5 298.6
------------ ------------
Co-investments
------------ ------------
Equity securities - quoted 35.8 22.3
------------ ------------
Equity securities - unquoted 74.8 41.8
------------ ------------
Debt securities - unquoted 124.9 107.1
------------ ------------
235.5 171.2
------------ ------------
Total investments 555.0 469.8
------------ ------------
The following explain movements in the underlying Oakley Funds'
portfolios and their respective investments.
Overview of OCI's underlying investments
Year of Open Fair
Investments Sector Location investment cost GBPm value GBPm
Fund I
---------- ----------------- ------------ ---------- -----------
Time Out Consumer Global 2010 48.3 35.2
---------- ----------------- ------------ ---------- -----------
OCI's proportionate allocation of Fund I investments
(on a look-through basis) 35.2
-------------
Other assets and liabilities (3.2)
------------ ---------- -----------
OCI's investment in Oakley Fund I 32.0
---------- -----------
Fund II
---------- ----------------- ------------ ---------- -----------
North Sails Consumer Global 2014 37.6 39.3
---------- ----------------- ------------ ---------- -----------
Inspired Education Global 2014 5.3 16.4
---------- ----------------- ------------ ---------- -----------
Daisy TMT UK 2015 10.4 13.6
---------- ----------------- ------------ ---------- -----------
OCI's proportionate allocation of Fund II investments
(on a look-through basis) 69.3
-------------
Other assets and liabilities (3.2)
-------------
OCI's investment in Oakley Fund II 66.1
-------------
Fund III
---------- ----------------- ------------ ---------- -----------
Casa & atHome Consumer Italy/Luxembourg 2017 26.3 42.3
---------- ----------------- ------------ ---------- -----------
Schülerhilfe Education Germany 2017 30.8 43.7
---------- ----------------- ------------ ---------- -----------
WebPros TMT USA/Switzerland 2017 7.6 57.3
---------- ----------------- ------------ ---------- -----------
TechInsights TMT Canada 2017 0.4 13.5
---------- ----------------- ------------ ---------- -----------
AMOS Education France 2017 10.0 16.5
---------- ----------------- ------------ ---------- -----------
CPG Education Germany 2018 20.6 45.8
---------- ----------------- ------------ ---------- -----------
Facile Consumer Italy 2018 28.8 33.1
---------- ----------------- ------------ ---------- -----------
Ekon TMT Spain 2019 18.0 18.0
---------- ----------------- ------------ ---------- -----------
OCI's proportionate allocation of Fund III investments
(on a look-through basis) 270.2
-------------
Other assets and liabilities (55.0)
-------------
OCI's investment in Oakley Fund III 215.3
-------------
Fund IV
---------- -----------
Seagull &
Videotel Education Norway/UK 2019 20.2 20.2
---------- ----------------- ------------ ---------- -----------
OCI's proportionate allocation of Fund IV investments
(on a look-through basis) 20.2
-------------
Other assets and liabilities (14.1)
-------------
OCI's investment in Oakley Fund IV 6.1
-------------
Co-investments
---------- ----------------- ------------ ---------- -----------
Equity
---------- ----------------- ------------ ---------- -----------
Inspired Education Global 2017 19.2 74.8
---------- ----------------- ------------ ---------- -----------
Time Out Consumer Global 2010 47.2 35.8
---------- ----------------- ------------ ---------- -----------
Debt
---------- ----------------- ------------ ---------- -----------
Time Out Consumer Global 2018 20.0 22.1
---------- ----------------- ------------ ---------- -----------
Daisy TMT UK 2015 14.2 15.3
---------- ----------------- ------------ ---------- -----------
North Sails Consumer Global 2014 52.1 61.7
---------- ----------------- ------------ ---------- -----------
Fund Facilities n/a n/a n/a 25.8
---------- ------------------------------- ---------- -----------
Total co-investments 235.5
---------- -----------
Total OCI investments 555.0
---------- -----------
Cash, other assets and liabilities 95.9
---------- -----------
OCI NAV at 30 June 2019 650.9
---------- -----------
The OCI look-through values are calculated using the OCI
attributable proportion (determined as the ratio which OCI's
commitments to the respective Fund bear to total commitments to
that Fund) applied to each investment's fair value as held in the
relevant Oakley Fund, net of any accrued performance fees relating
to that investment, and converted using the period end EUR:GBP
exchange rate.
The "Other assets and liabilities" noted in the tables above
include OCI's proportion of the Investec debt facilities that are
used by Oakley Fund II, Fund III and Fund IV. As at 30 June 2019,
the balances were EUR21.6 million, EUR143.4 million and EUR80.3
million in Oakley Fund II, Fund III and Fund IV respectively,
including interest.
The Oakley Funds also hold revolver loans with OCI. As at 30
June 2019, the balances drawn on these facilities were; EUR1.9
million in Oakley Fund I, nil in Oakley Fund II and EUR18.1 million
in Oakley Fund III, including interest.
Transactions
A busy period that has included a disposal, investments and
refinancings
Inspired
Partial disposal - Fund II
OCI's open
cost GBP24.5m
OCI's valuation GBP91.2m
--------
% of OCI NAV 14%
--------
In June, Inspired raised capital to provide further funds to
continue its M&A strategy, and to provide liquidity for certain
shareholders. Following a competitive process, Warburg Pincus
joined the investor group alongside TA Associates. Fund II sold
part of its stake in Inspired at an 80% premium to book value and,
as a result, OCI received EUR33.9 million (GBP30.2 million) from
this transaction. Through its indirect holding via Fund II and its
direct holding, OCI's investment in Inspired represents 14% of
OCI's NAV at 30 June 2019.
Ekon
New investment - Fund III
OCI's open
cost GBP18.0m
OCI's valuation GBP18.0m
--------
% of OCI NAV 3%
--------
In June, Fund III acquired Ekon, a leading Spanish ERP software
provider, in a carve-out from the Iberian operations of Unit4. This
represents Oakley's first investment in Spain and Fund III's third
investment in TMT, one of Oakley's key target sectors.
Oakley will use its expertise in software and complex carve-outs
to support management as they accelerate Ekon's growth as an
independent business.
Seagull & Videotel
New investment - Fund IV
OCI's open
cost GBP20.2m
OCI's valuation GBP20.2m
--------
% of OCI NAV 3%
--------
In June, Fund IV completed its first deal by acquiring
controlling stakes in two leading maritime e-learning providers,
Seagull & Videotel, based in Norway and the UK,
respectively.
This is Oakley's first investment in the Nordics and represents
a continuation of Oakley's successful track record in the education
and maritime sectors. The integration of the two businesses will
allow them to collaborate and share knowledge and resources as well
as building a platform for further M&A in existing and adjacent
markets.
Rastreator & Acierto
Signed investment - Fund III
OCI's open
cost c.GBP16.5m
OCI's valuation c.GBP16.5m
----------
In April, Fund III agreed to form a joint venture with Admiral
Group plc to acquire two of Spain's leading price comparison
websites for insurance and other financial products.
This is Oakley's third investment in online price comparison,
following Verivox and Facile in Fund II. Internet usage in Spain is
behind that in other developed countries, suggesting there is
further growth to come in the market.
Alessi
Post period end investment - Fund III
OCI's open
cost c.GBP5.9m
OCI's valuation c.GBP5.9m
---------
In August, Fund III signed an agreement to invest in Alessi, the
Italian high-end design business focused on homeware products.
Alessi is an iconic brand with 100 years of heritage and has
captured a global audience and a well-established premium position
in the market.
Prior to Oakley's investment, the business was still fully-owned
by the Alessi family. Oakley will use its expertise and experience
in the consumer sector to assist with developing the company to
adapt to the changing retail landscape and consumer
preferences.
Seven Miles
Signed investment - Fund III
OCI's open
cost c.GBP25.0m
OCI's valuation c.GBP25.0m
----------
In August, Fund IV agreed to acquire a majority stake in Seven
Miles, partnering with its founders, Tom Schröder and Valentin
Schütt. Seven Miles is a leading German consumer technology company
in the gift voucher and B2B gift card sector. The market for
multi-brand gift cards is expected to grow at c.15% in Germany in
the coming years. This acquisition continues Oakley's successful
track record of backing founder managers in consumer technology
platforms in the DACH region.
WebPros
Refinancing - Fund III
OCI's open
cost GBP7.6m
OCI's valuation GBP57.3m
--------
% of OCI NAV 9%
--------
In May, WebPros completed a partial refinancing and the
acquisition of WHMCS, a leading web hosting management and billing
SaaS platform.
As part of this refinancing, the Oakley loan notes were repaid,
returning $50.1 million to Oakley Fund III. The proceeds were used
to repay debt at the Fund level.
Career Partner Group
Refinancing - Fund III
OCI's open
cost GBP20.6m
OCI's valuation GBP45.8m
--------
% of OCI NAV 7%
--------
CPG continues to perform ahead of expectations, driven by strong
intake growth (+70% year-on-year) across online and dual studies.
On the back of this strong performance, CPG secured a committed
debt facility with existing lender Bluebay, allowing the return of
the full investment cost over the next 15 months in several
tranches, subject to continued performance.
The first tranche was drawn in February, returning EUR12.5
million (GBP10.9 million) to OCI.
North Sails
Co-investment debt
Equity Debt
OCI's open
cost GBP37.6m GBP52.1m
-------- --------
OCI's valuation GBP39.3m GBP61.7m
-------- --------
% of OCI NAV 16%
------------------
North Technology Group ("NTG") provides market-leading,
innovative and high-performance products and solutions for the
world's sailors and yachtsmen. NTG's EBITDA is 5% ahead of the
prior year with a much improved performance in the sails and
masts/booms divisions.
OCI provided GBP18.8 million to North Sails in co-investment
debt in the period. This funded both the relaunch of North
Kiteboarding, including the acquisition of kiteboarding accessories
brand, Mystic, and the continued recovery of North Sails Apparel as
it accelerates its marketing campaign. Apparel revenue is set to
grow by c.20% this year, driven by online sales, up 73% in H1.
Portfolio review
Strong progress and growth in the underlying Funds'
portfolios
Consumer
Casa & atHome
OCI's open
cost GBP26.3m
OCI's valuation GBP42.3m
--------
% of OCI NAV 6%
--------
An online group comprising a portfolio of real estate and
automotive classifieds websites and mobile applications. Casa &
atHome grew revenues by 13% in the year ending 30 June 2019.
Individually, Casa delivered revenue growth of 8%, driven primarily
by new customer acquisition. atHome Group grew revenue by 23%
driven by yield expansion in the core property listings vertical,
supplemented by the acquisitions of Luxauto and atHomeFinance.
Time Out
Equity Debt
OCI's open
cost GBP95.5m GBP20.0m
-------- --------
OCI's valuation GBP71.0m GBP22.1m
-------- --------
% of OCI NAV 14%
------------------
A leading multi-platform media and e-commerce brand with a
global content distribution network comprising websites, mobile
apps, magazines and a physical presence via live events and Time
Out Market. Strong momentum has continued in 2019 with the opening
of three markets in Miami, New York and Boston. This builds upon
the continued success of Time Out Market Lisbon, which reached a
record 3.9 million visitors in 2018. This strong start to the year
is reflected in a 60% uplift in the value of Time Out's shares.
Facile
OCI's open
cost GBP28.8m
OCI's valuation GBP33.1m
--------
% of OCI NAV 5%
--------
Italy's leading online price comparison site for motor
insurance, energy, telecoms and personal finance. Facile achieved
strong growth in 2019 with both revenue and EBITDA up 29% versus
the prior year. The core motor insurance vertical continued its
solid performance, driven by increased website quotes which
resulted in strong new business switching volumes. Facile's
non-insurance verticals have also continued to achieve significant
growth, particularly in the gas & power and broadband product
verticals.
TMT
Daisy
Equity Debt
OCI's open
cost GBP10.4m GBP14.2m
-------- --------
OCI's valuation GBP13.6m GBP15.3m
-------- --------
% of OCI NAV 4%
------------------
A leading UK supplier of business communications and managed
services. During its FY19, Daisy underwent a reorganisation and is
now structured into four autonomous divisions. The strategic
positioning of the group is now based on the growth dynamics of
each segment and potential exit opportunities. Daisy's performance
in the year to 31 March 2019 was in line with the previous
financial year. The Small Medium Business and Digital Wholesale
Solutions divisions grew organically, but this was offset by some
underperformance in the Corporate and Partner divisions.
TechInsights
OCI's open
cost GBP0.4m
OCI's valuation GBP13.5m
--------
% of OCI NAV 2%
--------
A global leader in the intellectual property and technology
services market, TechInsights felt the effects of a softer
semiconductor market in the first half of 2019. This was partially
offset by strong growth in the subscriptions segment of the
business, which saw revenues up 32% on the prior year. TechInsights
has invested significant engineering hours in subscription content
development, and new product verticals have been performing
strongly. The ongoing growth of the subscriptions segment remains
the key strategic objective of management.
Education
Schülerhilfe
OCI's open
cost GBP30.8m
OCI's valuation GBP43.7m
--------
% of OCI NAV 7%
--------
Germany's leading provider of after-school tutoring,
Schülerhilfe continues to deliver highly consistent and predictable
growth. In the six months to 30 June 2019, revenues have increased
by 12% compared to the same period in 2018 and EBITDA has grown by
15%. Schülerhilfe's enrolment growth over the same period is
currently 13% higher than 2018. Strong cashflow generation has
allowed for a further EUR6m repayment of debt during 2019, on top
of the EUR11m repaid in 2018.
AMOS
OCI's open
cost GBP10.0m
OCI's valuation GBP16.5m
--------
% of OCI NAV 3%
--------
France's leading business school focused entirely on sport
management and sport business. AMOS has enrolled over 2,000
students for the forthcoming academic year, which will drive
enrolment growth above 20%. There are now eight campuses in France
(five at acquisition) and a further one is expected to open in
September. After the period end, AMOS completed the acquisition of
ESDAC, a group of design and communication schools. This second
bolt-on acquisition adds further scale to the group.
Outstanding commitments of OCI
OCI's outstanding commitments to the Oakley Funds as at 30 June
2019 were GBP501.6 million, a 230% increase since 31 December 2018
due to the additional commitment of EUR400.0 million that was made
to Fund IV in early January.
The Board has concluded that, as Oakley Fund II and Oakley Fund
III are within their realisation phase, and in the light of the
expected distributions to be received over the next 12 to 18 months
in both Fund II and Fund III, it is satisfied that OCI will be able
to meet its unfunded commitments in the normal course.
The table below illustrates the Company's outstanding
commitments to the Oakley Funds, and their respective percentage of
the NAV of the Company at 30 June 2019.
Outstanding Outstanding
at 30 Jun at 30 Jun
Fund 2019 2019 % of
Current commitment
Fund vintage (EURm) (EURm) (GBPm) NAV
Oakley Fund
I 2007 202.4 2.8 2.5 0%
---------- ------------------ ----------- ----------- -----
Oakley Fund
II 2013 190.0 13.3 11.9 2%
---------- ------------------ ----------- ----------- -----
Oakley Fund
III 2016 325.8 153.1 137.1 21%
---------- ------------------ ----------- ----------- -----
Oakley Fund
IV 2019 400.0 391.0 350.1 54%
---------- ------------------ ----------- ----------- -----
501.6 77%
----------- -----
Cash and cash equivalents (109.2)
----------- -----
Net outstanding commitments unfunded by
cash resources 392.4 60%
----------- -----
Overview of Fund portfolio
Fund I
Oakley Capital Private Equity L.P. Open investments
Vintage: 2007
Fund size: EUR288m Time Out
OCI commitment: EUR202m
In 2007, Oakley raised its first EUR288 million private
equity fund with the aim of creating an investment platform
that would support entrepreneurial founders and managers.
The profile of deals was typically complex, and so deals
were often sourced outside of competitive auctions and
private equity secondary processes. The model was focused
on building long-term partnerships with entrepreneurs
and management to develop differentiated industry networks
and position the business as a partner of choice to entrepreneurs.
Fund I has only one portfolio company remaining, Time
Out Group plc, which is listed on AIM of the London Stock
Exchange. The remainder of the portfolio is fully exited
and has generated gross returns on realised investments
of 2.9x money multiple and 44% IRR.
----------------
Fund ll
Oakley Capital Private Equity II L.P. Open investments
Vintage: 2013
Fund size: EUR524m
OCI commitment: EUR190m Daisy
Oakley's second Fund launched in 2013, with total commitments Inspired
of EUR524 million. Since Fund I, the Oakley team refined North Sails
the investment strategy, having developed expertise in
three core sectors - Consumer, TMT and Education - while
continuing to leverage Oakley's entrepreneurial network.
Today, Fund II is now well into its realisation phase,
having exited six of its nine portfolio companies. The
Fund has generated gross returns of 3.3x money multiple
and 63% IRR on its realised investments and has just
three companies remaining - Inspired, North Sails and
Daisy. The Oakley team remains focused on maximising
value in the remaining portfolio and evaluating the potential
routes to exit to achieve meaningful returns for investors.
----------------
Fund IlI
Open investments
Oakley Capital Private Equity III L.P.
Vintage: 2016 Alessi
Fund size: EUR800m Amos
OCI commitment: EUR326m Casa &
Fund III closed with EUR800 million of commitments and atHome
is a 2016 vintage fund. The Fund portfolio is relatively Career Partner
nascent, with the oldest investment still under two and Group
a half years old and no investments realised to date. Ekon
Fund III has now made ten platform investments, one of Facile
which will complete following the period end (Rastreator Rastreator
and Acierto). For all completed deals the Fund's unrealised & Acierto
gross returns at 30 June 2019 are 1.8x money multiple Schülerhilfe
and 45% IRR and OCI has already received GBP36.5 million TechInsights
of distributions from the Fund, since inception. WebPros
------------------
Fund lV
Oakley Capital IV Master SCSp Open investments
Vintage: 2019
Fund size: EUR1.5bn
OCI commitment: EUR400m Seagull & Videotel
Oakley's newest Fund, which held its final close in June Seven Miles
2019, closed above its target size of EUR1.2 billion,
with total committed capital of EUR1.5 billion. OCI has
made a EUR400 million commitment to Fund IV, which follows
the same proven strategy as Oakley's previous Funds.
Fund IV has already made its first acquisition, combining
two leading players in the marine education sector -
Seagull & Videotel. Following the period end, the Fund
has also agreed to acquire Seven Miles, a leading consumer
technology company in the gift solutions space. The Oakley
team continues to see a healthy pipeline of exciting
opportunities and is focused on sourcing and delivering
deals that will generate sustainable value and meaningful
returns to the Funds' investors and, in turn, OCI's shareholders.
-------------------
OCI co-investment review
The co-investment portfolio as at 30 June 2019 is summarised in
the table below:
30 Jun 2019 31 Dec 2018
Fair value Fair value
Co-investments GBPm GBPm
Equity securities
----------- -----------
Inspired 74.8 41.8
----------- -----------
Time Out 35.8 22.3
----------- -----------
Debt securities
----------- -----------
Time Out 22.1 20.9
----------- -----------
Daisy 15.3 14.9
----------- -----------
North Sails 61.7 40.6
----------- -----------
Fund Facilities 25.8 30.6
----------- -----------
Total co-investments 235.5 171.2
----------- -----------
Equity securities
Inspired's recent capital raise prompted a full revaluation of
the Inspired group that resulted in an 80% premium to the
prevailing book value. OCI's direct holding in Inspired, (through
the entity OCPEE Feeder L.P.), did not participate in the sell-down
in June 2019, but was able to benefit from the re-valuation.
Inspired continues to prosper with further acquisitions being
pursued in the Asian markets.
The success of the Time Out Markets has become apparent in the
market-place since the opening of the Miami, New York and Boston
markets. The share price has increased from GBP0.71 at 31 December
2018 to GBP1.14 at 30 June 2019. Time Out is focused on the
continued global roll-out of this format. Time Out Markets will
open this year in Chicago and Montréal, followed by Dubai,
London-Waterloo and Prague over the coming years. At the end of
2019 there will be six Time Out Markets in operation, with a total
of 185,000 square feet, almost 4,000 covers and food from 120 of
the world's best chefs.
Debt securities
OCI provides debt facilities to portfolio companies. The
interest income generated by these facilities exceeds the interest
earned on OCI's bank deposits, allowing OCI to earn higher returns
on part of its cash reserves. During the period, OCI earned GBP4.5
million interest from its debt facilities. OCI provided a further
GBP18.8 million to North Sails in co-investment debt to fund both
the relaunch of North Kiteboarding, including the acquisition of
kiteboarding accessories brand, Mystic, and the continued recovery
of North Sails Apparel as it accelerates its marketing
campaign.
OCI also provides revolving credit facilities to each of the
Oakley Funds. Each drawing under these facilities is for no more
than one year. The loans are used to fund short-term cash
requirements of the Oakley Funds. As at 30 June 2019, OCI had
outstanding debt facilities of GBP25.7 million to the Oakley Funds,
including accrued interest, a decrease of GBP4.9 million from 31
December 2018, primarily due to repayments of the Oakley Fund II
facilities.
Statement of Directors' responsibilities
Statement of principal risks and uncertainties
As an investment company, with an investment portfolio
comprising financial assets, the principal risks associated with
the Company's business largely relate to financial risks, strategic
and business risks, and operating risks. A detailed analysis of the
Company's principal risks and uncertainties are set out on pages 40
and 41 of the annual report and accounts 2018 and have not changed
materially since the date of the report. The Company has not
identified any new risks that will impact the remaining six months
of the financial year.
Statement of Directors' responsibilities
The Directors confirm that to the best of their knowledge:
-- the condensed interim report includes a fair review of the
development and performance of the business and the position of the
Company;
-- the condensed consolidated interim financial statements have
been prepared in accordance with IAS 34 interim financial reporting
and give a true and fair view of the assets, liabilities, financial
position and results of the Company, and are in compliance with the
requirements set out in the Bermuda Companies Act 1981 (as
amended);
-- the condensed interim report includes a fair review of the information required by:
a) 4.2.7R of the Disclosure Guidance and Transparency Rules,
being an indication of important events that have occurred during
the first six months of the current financial year and their impact
on the consolidated interim financial statements, and a description
of the principal risks and uncertainties for the remaining six
months of the year; and
b) 4.2.8R of the Disclosure Guidance and Transparency Rules,
being all related party transactions that have taken place in the
first six months of the current financial year which have
materially affected the financial position or performance of the
Company during that period and any changes in the related party
transactions described in the annual report and accounts that could
materially affect the financial position or performance of the
Company during the first six months of the current financial year;
and
-- the condensed consolidated interim financial statements
should be read in conjunction with the latest annual report and
financial statements which were prepared in accordance with IFRS.
These financial statements provide the information necessary to
assess the Company's position and performance, business model and
strategy, and is fair, balanced and understandable.
Financial Statements
Consolidated statement of comprehensive income (unaudited)
for the six months ended 30 June 2019
6 months ended 6 months ended
30 Jun 2019 30 Jun 2018
Notes GBP'000 GBP'000
Income
----- -------------- --------------
Interest income 4,543 3,511
----- -------------- --------------
Net realised gains on investments
at fair value through profit
and loss 6, 7 17,840 92,667
----- -------------- --------------
Net change in unrealised gains/(losses)
on investments at fair value
through profit and loss 6, 7 72,054 (63,408)
----- -------------- --------------
Net foreign currency gains/(losses) (286) 1,750
----- -------------- --------------
Other income 520 187
----- -------------- --------------
Total income 94,671 34,707
----- -------------- --------------
Expenses 9 (13,211) (2,407)
----- -------------- --------------
Profit attributable to equity
shareholders/total comprehensive
income 81,460 32,300
----- -------------- --------------
Earnings per share
----- -------------- --------------
Basic and diluted earnings
per share 10 GBP0.40 GBP0.16
----- -------------- --------------
Consolidated balance sheet (unaudited)
as at 31 December 2018
(Audited)
As at As at As at
30 Jun 2019 31 Dec 2018 30 Jun 2018
Notes GBP'000 GBP'000 GBP'000
Assets
----- ------------ ------------ ------------
Non-current assets
----- ------------ ------------ ------------
Investments 6, 7 555,023 469,749 381,526
----- ------------ ------------ ------------
555,023 469,749 381,526
----- ------------ ------------ ------------
Current assets
----- ------------ ------------ ------------
Trade and other receivables 106 11 117
----- ------------ ------------ ------------
Cash and cash equivalents 109,194 107,888 149,760
----- ------------ ------------ ------------
109,300 107,899 149,877
----- ------------ ------------ ------------
Total assets 664,323 577,648 531,403
----- ------------ ------------ ------------
Liabilities
----- ------------ ------------ ------------
Current liabilities
----- ------------ ------------ ------------
Trade and other payables 13,416 2,826 1,671
----- ------------ ------------ ------------
Total liabilities 13,416 2,826 1,671
----- ------------ ------------ ------------
Net assets attributable
to shareholders 650,907 574,822 529,732
----- ------------ ------------ ------------
Equity
----- ------------ ------------ ------------
Share capital 12 2,044 2,048 2,048
----- ------------ ------------ ------------
Share premium 12 243,770 244,533 244,533
----- ------------ ------------ ------------
Retained earnings 405,093 328,241 283,151
----- ------------ ------------ ------------
Total shareholders' equity 650,907 574,822 529,732
----- ------------ ------------ ------------
Net asset per ordinary
share
----- ------------ ------------ ------------
Basic and diluted net
assets per share 11 GBP3.18 GBP2.81 GBP2.59
----- ------------ ------------ ------------
Ordinary shares in issue 204,400 204,804 204,804
----- ------------ ------------ ------------
Consolidated statement of changes in equity (unaudited)
for the six months ended 30 June 2019
Share Retained Total shareholders'
capital Share premium earnings equity
GBP'000 GBP'000 GBP'000 GBP'000
For the six months ended
30 June 2019
-------- ------------- --------- -------------------
Balance at 1 January
2019 2,048 244,533 328,241 574,822
-------- ------------- --------- -------------------
Profit for the period/
total comprehensive
income - - 81,460 81,460
-------- ------------- --------- -------------------
Ordinary shares repurchased
and cancelled (4) (763) - (767)
-------- ------------- --------- -------------------
Dividends - - (4,608) (4,608)
-------- ------------- --------- -------------------
Total transactions with
equity shareholders (4) (763) (4,608) (5,375)
-------- ------------- --------- -------------------
Balance at 30 June 2019 2,044 243,770 405,093 650,907
-------- ------------- --------- -------------------
For the six months ended
30 June 2018
-------- ------------- --------- -------------------
Balance at 1 January
2018 2,048 244,533 255,459 502,040
-------- ------------- --------- -------------------
Profit for the period/
total comprehensive
income - - 32,300 32,300
-------- ------------- --------- -------------------
Dividends - - (4,608) (4,608)
-------- ------------- --------- -------------------
Total transactions with
equity shareholders - - (4,608) (4,608)
-------- ------------- --------- -------------------
Balance at 30 June 2018 2,048 244,533 283,151 529,732
-------- ------------- --------- -------------------
Consolidated statement of cash flows (unaudited)
for the six months ended 30 June 2019
6 months ended 6 months ended
30 Jun 2019 30 Jun 2018
Notes GBP'000 GBP'000
Cash flows from operating activities
----- -------------- --------------
Purchases of investments 6 (52,898) (90,125)
----- -------------- --------------
Proceeds from investments 6 61,880 126,106
----- -------------- --------------
Interest income received 181 433
----- -------------- --------------
Expenses paid (2,716) (1,819)
----- -------------- --------------
Other income received 520 187
----- -------------- --------------
Net cash provided by/(used in)
operating activities 6,967 34,782
----- -------------- --------------
Cash flows from financing activities
----- -------------- --------------
Purchase of ordinary shares 12 (767) -
----- -------------- --------------
Dividends paid (4,608) (4,608)
----- -------------- --------------
Net cash provided by/(used in) financing
activities (5,375) (4,608)
-------------- --------------
Net increase in cash and cash equivalents 1,592 30,174
----- -------------- --------------
Cash and cash equivalents at the
beginning
of the period 107,888 117,836
----- -------------- --------------
Effect of foreign exchange rate changes (286) 1,750
----- -------------- --------------
Cash and cash equivalents at the end of
the period 109,194 149,760
-------------- --------------
Notes to the consolidated interim financial statements
for the six months ended 30 June 2019
1. Reporting entity
Oakley Capital Investments Limited (the "Company") is a
closed-end investment company incorporated under the laws of
Bermuda on 28 June 2007. The principal objective of the Company is
to achieve capital appreciation through investments in a
diversified portfolio of high-growth, medium-sized companies,
mainly in the UK and Europe. The Company currently achieves its
investment objective primarily through its investments in the
following five private equity funds (the "Funds"):
-- Oakley Capital Private Equity L.P. ("Fund I");
-- Oakley Capital Private Equity II-A L.P., which together with
Oakley Capital Private Equity II-B L.P., Oakley Capital Private
Equity II-C L.P. (collectively the "Fund II Feeder Funds") and OCPE
II Master L.P. (the "Fund II Master") collectively comprise "Fund
II";
-- Oakley Capital Private Equity III-A L.P., which together with
Oakley Capital Private Equity III-B L.P., Oakley Capital Private
Equity III-C L.P. (collectively the "Fund III Feeder Funds") and
OCPE III Master L.P. (the "Fund III Master") collectively comprise
"Fund III";
-- Oakley Capital Private Equity IV-A SCSp, which together with
Oakley Capital Private Equity IV-B SCSp, Oakley Capital Private
Equity IV-C SCSp (collectively the "Fund IV Feeder Funds") and
Oakley Capital IV Master SCSp (the "Fund IV Master") collectively
comprise "Fund IV"; and
-- OCPE Education (Feeder) L.P., which together with OCPE
Education L.P. collectively comprise "OCPE Education".
Fund I, Fund II, Fund III and OCPE Education are all constituent
limited partnerships and are exempted limited partnerships
established in Bermuda. Fund IV constitutes a group of limited
partnerships established in Luxembourg.
The defined term "Company" shall, where the context requires for
the purposes of consolidation, include the Company's sole and
wholly owned subsidiary, OCI Financing (Bermuda) Limited ("OCI
Financing") (prior to a name change made on 23 May 2019, OCI
Financing was previously known as OCIL Financing (Bermuda)
Limited).
The Company was listed on the Alternative Investments Market
("AIM") of the London Stock Exchange Limited on 3 August 2007, with
"OCI" as its listed ticker.
2. Basis of preparation
The condensed consolidated interim financial statements of the
Company have been prepared on a going concern basis and under the
historical cost convention, except for financial instruments at
fair value through profit and loss, which are measured at fair
value.
The Board of Directors consider that it is appropriate to adopt
the going concern basis of accounting in preparing these condensed
interim financial statements. In reaching this assessment, the
Board of Directors have considered a wide range of information
relating to the present and future conditions, including the
condensed statement of financial position, future projections, cash
flows and the longer-term strategy of the Company.
2.1 Basis for compliance
The condensed consolidated interim financial statements have
been prepared in accordance with IAS 34 Interim financial
requirements and should be read in conjunction with the latest
annual report and financial statements as at and for the year ended
31 December 2018, which were prepared in accordance with
International Financial Reporting Standards ("IFRS"). These
consolidated interim financial statements do not include all the
information required for a complete set of IFRS financial
statements. However, the explanatory notes are included to explain
events and transactions that are significant to an understanding of
changes in the Company's financial position and performance since
the last annual consolidated financial statements.
The condensed consolidated interim financial statements were
authorised for issue on 10 September 2019 by the Company's Board of
Directors 2.2 Functional and presentation currency.
The condensed consolidated interim financial statements are
presented in British pounds ("pounds"), which is the Company's
functional currency.
3. Significant accounting policies
The accounting policies used are consistent with those applied
in the latest annual consolidated financial statements, except for
the adoption of new standards effective as of 1 January 2019.
Several amendments and interpretations apply for the first time
effective 1 January 2019 but do not have a material effect on the
Company's consolidated interim financial statements and did not
require retrospective adjustments. The changes in accounting
policies will be reflected in the Company's annual consolidated
financial statements as at and for the year ending 31 December
2019.
A number of standards have been issued but are not yet effective
as at period end. The Company is currently in the process of
analysing the impact of these new standards, amendments to existing
standards and annual improvements to IFRS in detail but these are
not expected to have a material effect on the consolidated annual
financial statements of the Company.
4. Critical accounting estimates, assumptions and judgment
The reported results of the Company are sensitive to the
accounting policies, assumptions and estimates that underlie the
preparation of its consolidated interim financial statements. IFRS
require the Board of Directors, in preparing the Company's
consolidated interim financial statements, to select suitable
accounting policies, apply them consistently and make judgments and
estimates that are reasonable and prudent. The Company's estimates
and assumptions are based on historical experience and the Board of
Directors' expectation of future events and are reviewed
periodically. The actual outcome may be materially different from
that anticipated. Revisions to accounting estimates are recognised
in the period in which the estimates are revised and in any future
periods.
The judgments, assumptions and estimates involved in the
Company's accounting policies that are considered by the Board of
Directors to be the most important to Company's results and
financial condition are the fair valuation of the investments and
the assessment that the Company meets the definition of an
investment entity.
In preparing the condensed consolidated interim financial
statements, significant judgments were made in applying the
Company's accounting policies and the key sources of estimation
uncertainty were consistent with those applied to the annual
consolidated financial statements as at and for the year ended 31
December 2018.
(a) Fair valuation of investments
The fair values assigned to investments held at fair value
through profit and loss are based upon available information at the
time and do not necessarily represent amounts which might
ultimately be realised. Because of the inherent uncertainty of
valuation, these estimated fair values may differ significantly
from the values that would have been used had a ready market for
the investments existed, and those differences could be
material.
Investments held at fair value through profit and loss are
valued by the Company in accordance with relevant IFRS
requirements. Judgment is required in order to determine the
appropriate valuation methodology under these standards and
subsequently in determining the inputs into the valuation models
used. These judgments include making assessments of the future
earnings potential of portfolio companies, appropriate earnings
multiples to apply, estimating future cash flows and determining
appropriate discount rates.
(b) Assessment as an investment entity
Entities that meet the definition of an investment entity within
IFRS 10 are required to account for investments in controlled
entities, as well as investments in associates and joint ventures,
at fair value through profit and loss.
The Board of Directors has concluded that the Company meets the
definition of an investment entity, as its strategic objective is
to invest in portfolio investments on behalf of its investors for
the purpose of generating returns in the form of investment income
and capital appreciation.
5. Financial risk management
The Board of Directors, the Company's Risk Committee (the "Risk
Committee") and Oakley Capital Limited (the "Investment Adviser")
attribute great importance to professional risk management, proper
understanding and negotiation of appropriate terms and conditions
and active monitoring, including a thorough analysis of reports and
financial statements and ongoing review of investments made. It is
also key to structure the investment portfolio taking into account
issues such as liquidity and tax. The Company has investment
guidelines that set out its overall business strategies, its
tolerance for risk and its general risk management philosophy and
has established processes to monitor and control the economic
impact of these risks. The Investment Adviser provides the Board of
Directors with recommendations as to the Company's asset allocation
and annual investment levels that are consistent with the Company's
objectives. The Risk Committee reviews and agrees policies for
managing the risks.
The Company has exposures to the following risks from financial
instruments: credit risk, liquidity risk and market risk (including
interest rate risk, currency risk, and price risk). The Company's
overall risk management process focuses on the unpredictability of
financial markets and seeks to minimise potential adverse effects
on the Company's financial performance.
As at 30 June 2019, there have been no changes to the membership
of the Risk Committee nor to any of the Company's risk policies
since 31 December 2018 and as a result, the condensed consolidated
interim financial statements do not include all financial risk
management information and disclosures required in the annual
consolidated financial statements. The condensed consolidated
interim financial statements should be read in conjunction with the
Company's annual consolidated financial statements as at 31
December 2018.
6. Investments
As at 30 June 2019:
31 Dec Change 30 Jun
2018 Purchases/ Realised Interest in unrealised 2019
Fair Capital Total sales*/ gains/ and gains/ Fair
value calls Distributions (losses) other (losses) value
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Oakley Funds
-------- ---------- -------------- --------- -------- -------------- --------
Fund I 18,159 1,788 - - - 12,037 31,984
-------- ---------- -------------- --------- -------- -------------- --------
Fund II 71,794 7,386 (30,197) 19,067 - (1,940) 66,110
-------- ---------- -------------- --------- -------- -------------- --------
Fund III 208,628 - (9,712) (1,227) - 17,650 215,339
-------- ---------- -------------- --------- -------- -------------- --------
Fund IV - 7,901 - - - (1,810) 6,091
-------- ---------- -------------- --------- -------- -------------- --------
Total Oakley
Funds 298,581 17,075 (39,909) 17,840 - 25,937 319,524
-------- ---------- -------------- --------- -------- -------------- --------
Co-investment
Funds
-------- ---------- -------------- --------- -------- -------------- --------
OCPE Education
(Feeder) L.P. 41,789 374 - - - 32,599 74,762
-------- ---------- -------------- --------- -------- -------------- --------
Total co-investment
Funds 41,789 374 - - - 32,599 74,762
-------- ---------- -------------- --------- -------- -------------- --------
Total Funds 340,370 17,449 (39,909) 17,840 - 58,536 394,286
-------- ---------- -------------- --------- -------- -------------- --------
Quoted equity
securities
-------- ---------- -------------- --------- -------- -------------- --------
Time Out Group
plc 22,320 - - - - 13,518 35,838
-------- ---------- -------------- --------- -------- -------------- --------
Total quoted
equity
securities 22,320 - - - - 13,518 35,838
-------- ---------- -------------- --------- -------- -------------- --------
Unquoted debt
securities
-------- ---------- -------------- --------- -------- -------------- --------
Ellisfield (Bermuda)
Limited 14,889 - - - 434 - 15,323
-------- ---------- -------------- --------- -------- -------------- --------
Fund I 7,035 800 - - 245 - 8,080
-------- ---------- -------------- --------- -------- -------------- --------
Fund II 17,412 4,044 (21,846) - 390 - -
-------- ---------- -------------- --------- -------- -------------- --------
Fund III 4,033 11,791 - - 410 - 16,234
-------- ---------- -------------- --------- -------- -------------- --------
NSG Apparel BV 26,569 - - - 496 - 27,065
-------- ---------- -------------- --------- -------- -------------- --------
Oakley Capital
III
Limited 2,169 - (770) - 47 - 1,446
-------- ---------- -------------- --------- -------- -------------- --------
Oakley NS
(Bermuda) L.P. 14,038 18,814 - - 1,795 - 34,647
-------- ---------- -------------- --------- -------- -------------- --------
Time Out Group
plc 20,914 - - - 1,190 - 22,104
-------- ---------- -------------- --------- -------- -------------- --------
Total unquoted
debt securities 107,059 35,449 (22,616) - 5,007 - 124,899
-------- ---------- -------------- --------- -------- -------------- --------
Total investments 469,749 52,898 (62,525) 17,840 5,007 72,054 555,023
-------- ---------- -------------- --------- -------- -------------- --------
* Total sales include redemptions, loan repayments and transfers
As at 30 June 2018:
31 Dec Change 30 Jun
2017 Purchases/ Realised Interest in unrealised 2018
Fair Capital Total sales*/ gains/ and gains/ Fair
value calls Distributions (losses) other (losses) value
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Oakley Funds
-------- ---------- -------------- --------- -------- -------------- --------
Fund I 36,551 - - - - (11,795) 24,756
-------- ---------- -------------- --------- -------- -------------- --------
Fund II 137,054 15,732 (102,748) 94,476 - (61,031) 83,483
-------- ---------- -------------- --------- -------- -------------- --------
Fund III 109,058 28,613 (10,644) (1,809) - 6,220 141,438
-------- ---------- -------------- --------- -------- -------------- --------
Total Oakley
Funds 282,663 44,345 (113,392) 92,667 - (56,606) 249,677
-------- ---------- -------------- --------- -------- -------------- --------
Co-investment
Funds
-------- ---------- -------------- --------- -------- -------------- --------
OCPE Education
(Feeder) L.P. 26,280 32 - - - 5,773 32,085
-------- ---------- -------------- --------- -------- -------------- --------
Total co-investment
Funds 26,280 32 - - - 5,773 32,085
-------- ---------- -------------- --------- -------- -------------- --------
Total Funds 308,943 44,377 (113,392) 92,667 - (50,833) 281,762
-------- ---------- -------------- --------- -------- -------------- --------
Quoted equity
securities
-------- ---------- -------------- --------- -------- -------------- --------
Time Out Group
plc 41,182 - - - - (12,575) 28,607
-------- ---------- -------------- --------- -------- -------------- --------
Total quoted
equity
securities 41,182 - - - - (12,575) 28,607
-------- ---------- -------------- --------- -------- -------------- --------
Unquoted debt
securities
-------- ---------- -------------- --------- -------- -------------- --------
Daisy Group
Holdings Limited 12,701 - - - 830 - 13,531
-------- ---------- -------------- --------- -------- -------------- --------
Ellisfield
(Bermuda)
Limited 15,455 - - - 470 - 15,925
-------- ---------- -------------- --------- -------- -------------- --------
Fund I 6,351 918 (1,474) - 198 - 5,993
-------- ---------- -------------- --------- -------- -------------- --------
Fund II - 7,159 (7,224) - 65 - -
-------- ---------- -------------- --------- -------- -------------- --------
NSG Apparel
BV 24,651 - - - 1,450 - 26,065
-------- ---------- -------------- --------- -------- -------------- --------
Oakley Capital
III
Limited 7,168 - (4,452) - 234 - 2,950
-------- ---------- -------------- --------- -------- -------------- --------
Oakley NS
(Bermuda)
L.P. 3,212 3,213 - - 268 - 6,693
-------- ---------- -------------- --------- -------- -------------- --------
Total unquoted
debt securities 69,502 11,290 (13,150) - 3,515 - 71,157
-------- ---------- -------------- --------- -------- -------------- --------
Total investments 419,627 55,667 (126,542) 92,667 3,515 (63,408) 381,526
-------- ---------- -------------- --------- -------- -------------- --------
* Total sales include redemptions, loan repayments and transfers
Quoted equity securities and unquoted debt securities are
additional direct investments in certain of the portfolio companies
in one of the Oakley Funds.
7. Disclosure about fair value of financial instruments
The Company has adopted IFRS 13 in respect of disclosures about
the degree of reliability of fair value measurements. These fair
value measurements are categorised into different levels in the
fair value hierarchy based on the inputs to valuation techniques
used. The Company classifies financial instruments measured at fair
value in the investment portfolio according to the following
hierarchy:
-- Level I:
Quoted prices (unadjusted) in active markets for identical
instruments that the Company can access at the measurement date.
Level I investments include quoted equity instruments.
-- Level II:
Inputs other than quoted prices included within Level I that are
observable for the instrument, either directly (i.e. as prices) or
indirectly (i.e. derived from prices).
-- Level III:
Inputs that are not based on observable market data. Level III
investments include private equity funds, unquoted equity and debt
securities.
The level in the fair value hierarchy within which the fair
value measurement is categorised is determined on the basis of the
lowest level input that is significant to the fair value
measurement in its entirety. Assessing the significance of a
particular input to the fair value measurement in its entirety
requires judgment, considering factors specific to the instrument.
The determination of what constitutes "observable" requires
significant judgment by the Company. The Company considers
observable data to be market data that is readily available,
regularly distributed or updated, reliable and verifiable, not
proprietary, and provided by independent sources that are actively
involved in the relevant market.
The following table analyses the Company's investments measured
at fair value as of 30 June 2019 by the level in the fair value
hierarchy into which the fair value measurement is categorised:
Level I Level III Total
GBP'000 GBP'000 GBP'000
Funds - 394,286 394,286
-------- --------- --------
Quoted equity securities 35,838 - 35,838
-------- --------- --------
Unquoted debt securities - 124,899 124,899
-------- --------- --------
Total investments measured
at fair value 35,838 519,185 555,023
-------- --------- --------
The following table analyses the Company's investments measured
at fair value as of 30 June 2018 by the level in the fair value
hierarchy into which the fair value measurement is categorised:
Level I Level III Total
GBP'000 GBP'000 GBP'000
Funds - 281,762 281,762
-------- --------- --------
Quoted equity securities 28,607 - 28,607
-------- --------- --------
Unquoted debt securities - 71,157 71,157
-------- --------- --------
Total investments measured
at fair value 28,607 352,919 381,526
-------- --------- --------
Level I
Quoted equity investment values are based on quoted market
prices in active markets, and are therefore classified within Level
I investments. The Company does not adjust the quoted price for
these investments.
Level II
The Company did not hold any Level II investments as of 30 June
2019 or 30 June 2018.
Level III
The Company has determined that Funds and unquoted debt
securities fall into Level III. Funds and unquoted debt securities
are measured in accordance with the IPEV Valuation Guidelines with
reference to the most appropriate information available at the time
of measurement. The condensed consolidated interim financial
statements as of 30 June 2019 include Level III investments in the
amount of GBP519,185,368; representing approximately 79.76% of
equity (2018: GBP352,918,501; 66.62%).
Funds
The Company primarily invests in portfolio companies via the
Funds in which it is a Limited Partner. The Funds are unquoted
equity securities that invest in unquoted securities. The Company's
investments in unquoted equity securities are recognised in the
consolidated balance sheet at fair value, in accordance with IPEV
Valuation Guidelines and IFRS 13 and are considered Level III
investments.
The valuation of unquoted fund investments is generally based on
the latest available net asset value ("NAV") of the respective Fund
as reported by the corresponding general partner or administrator,
provided that the NAV has been appropriately determined using fair
value principles in accordance with IFRS 13.
The NAV of a Fund is calculated after determining the fair value
of a Fund's investment in any portfolio company. This value is
generally obtained by calculating the enterprise value ("EV") of
the portfolio company and then adding excess cash and deducting
financial instruments, such as external debt, ranking ahead of the
Fund's highest ranking instrument in the portfolio company.
A common method of determining the EV is to apply a market-based
multiple (e.g. an average multiple based on a selection of
comparable quoted companies) to the "maintainable" earnings or
revenues of the portfolio company. This market-based approach
presumes that the comparator companies are correctly valued by the
market. A discount is sometimes applied to market based multiples
to adjust for points of difference between the comparators and the
company being valued.
As at 30 June 2019, the value of the Funds' investments, other
assets and liabilities attributable to the Company based on its
respective percentage interest in each Fund was as follows:
Fund I Fund II Fund III Fund IV OCPE Education
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
Investments 39,688 82,106 329,073 22,649 83,259
-------- -------- -------- -------- --------------
Loans (6,350) (7,820) (65,762) (22,722) -
-------- -------- -------- -------- --------------
Provisional profit allocation - (4,696) (27,156) - -
-------- -------- -------- -------- --------------
Other net assets 2,386 4,251 4,367 6,877 246
-------- -------- -------- -------- --------------
Total value of the Fund
attributable to the
Company 35,724 73,841 240,522 6,804 83,505
-------- -------- -------- -------- --------------
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Total value of the Fund
attributable to the
Company 31,984 66,110 215,339 6,091 74,762
-------- -------- -------- -------- --------------
As at 30 June 2018, the value of the Funds' investments, other
assets and liabilities attributable to the Company based on its
respective percentage interest in each Fund was as follows:
Fund I Fund II Fund III Fund IV OCPE Education
EUR'000 EUR'000 EUR'000 EUR'000 EUR'000
Investments 30,146 112,993 210,866 - 35,987
-------- -------- --------- -------- --------------
Loans (4,437) (12,623) (48,401) - -
-------- -------- --------- -------- --------------
Provisional profit allocation - (7,358) (6,940) - -
-------- -------- --------- -------- --------------
Other net assets 2,269 1,341 4,328 - 273
-------- -------- --------- -------- --------------
Total value of the Fund
attributable to the
Company 27,978 94,353 159,853 - 36,260
-------- -------- --------- -------- --------------
GBP'000 GBP'000 GBP'000 GBP'000
Total value of the Fund
attributable to the GBP'000
Company 24,756 83,483 141,438 - 32,085
-------- -------- --------- -------- --------------
The Company does not utilise valuation models to calculate the
fair value of its Fund investments. The NAV as reported by the
Funds' general partner or administrator is considered to be the key
unobservable input. In addition, the Company has the following
control procedures in place to evaluate whether the NAV of the
underlying fund investments is calculated in a manner consistent
with IFRS 13:
-- Thorough initial due diligence process and the Board of
Directors performing ongoing monitoring procedures, primarily
discussions with the Investment Adviser;
-- Comparison of historical realisations to last reported fair values; and
-- Review of the auditor's report of the respective Fund.
Unquoted debt securities
The fair values of the Company's investments in unquoted debt
securities are derived from a discounted cash flow calculation
based on expected future cash flows to be received, discounted at
an appropriate rate. Expected future cash flows include interest
received and principal repayment at maturity.
Unobservable inputs for Level III investments
Funds
In arriving at the fair value of the unquoted fund investments,
the key input used by the Company is the NAV as provided by the
general partner or administrator. It is recognised by the Company
that the NAVs of the Funds are sensitive to movements in the fair
values of the underlying portfolio companies.
The underlying portfolio companies owned by the Funds may
include both quoted and unquoted companies. Quoted portfolio
companies are valued based on market prices and no unobservable
inputs are used. Unquoted portfolio companies are valued based on a
market approach for which significant judgment is applied.
For the purposes of sensitivity analysis, the Company considers
a 10% adjustment to the fair value of the unquoted portfolio
companies of the Funds as reasonable. For the period ending 30 June
2019 a 10% increase to the fair value of the unquoted portfolio
companies held by the Funds would result in a 6.5% movement in net
assets attributable to shareholders (2018: 5.4%). A 10% decrease to
the fair value of the unquoted portfolio companies held by the
Funds would have an equal and opposite effect.
Unquoted debt securities
In arriving at the fair value of the unquoted debt securities,
the key inputs used by the Company are future cash flows expected
to be received until maturity of the debt securities and the
discount factor applied. The discount factor applied is considered
to be an unobservable input and range between 6.5% and 15%.
For the purposes of sensitivity analysis, the Company considers
a 1% adjustment to the discount factor applied as reasonable. For
the period ending 30 June 2019a 1% increase to the discount factor
would result in a 0.4% movement in net assets attributable to
shareholders (2018: 0.1%). A 1% decrease to the discount factor
would have an equal and opposite effect.
Transfers between Levels
There were no transfers between the Levels during the period
ended 30 June 2019 and 30 June 2018.
Level I and Level III reconciliation
The changes in investments measured at fair value, for which the
Company has used Level I and Level III inputs to determine fair
value as of 30 June 2019 and30 June 2018, are as follows:
Level I Investments:
As at As at
30 Jun 2019 30 Jun 2018
GBP'000 GBP'000
Quoted equity securities
------------ ------------
Fair value at the beginning of the
period 22,320 41,182
------------ ------------
Net change in unrealised gains/(losses)
on investments 13,518 (12,575)
------------ ------------
Fair value of Level I investments at
the end of the period 35,838 28,607
------------ ------------
Level III Investments:
Unquoted
Funds debt securities Total
GBP'000 GBP'000 GBP'000
For the six months ended 30 June 2019
-------- ---------------- --------
Fair value at the beginning of the
period 340,370 107,059 447,429
-------- ---------------- --------
Purchases 17,449 35,449 52,898
-------- ---------------- --------
Proceeds on disposals (including interest) (39,909) (22,616) (65,525)
-------- ---------------- --------
Realised gain on sale 17,840 - 17,840
-------- ---------------- --------
Interest income and other fee income - 5,007 5,007
-------- ---------------- --------
Net change in unrealised gains/(losses)
on investments 58,536 - 58,536
-------- ---------------- --------
Fair value at the end of the period 394,286 124,899 519,185
-------- ---------------- --------
Unquoted
Funds debt securities Total
GBP'000 GBP'000 GBP'000
For the six months ended 30 June 2018
--------- ---------------- ---------
Fair value at the beginning of the
period 308,943 69,502 378,445
--------- ---------------- ---------
Purchases 44,377 11,290 55,667
--------- ---------------- ---------
Proceeds on disposals (including interest) (113,392) (13,150) (126,542)
--------- ---------------- ---------
Realised gain on sale 92,667 - 92,667
--------- ---------------- ---------
Interest income and other fee income - 3,515 3,515
--------- ---------------- ---------
Net change in unrealised gains/(losses)
on investments (50,833) - (50,833)
--------- ---------------- ---------
Fair value at the end of the period 281,762 71,157 352,919
--------- ---------------- ---------
Financial instruments not carried at fair value
Financial instruments, other than financial instruments at fair
value through profit and loss, where carrying values are equal to
fair values:
As at
30 Jun As at
2019 30 Jun 2018
GBP'000 GBP'000
Cash and cash equivalents 109,194 149,760
-------- ------------
Trade and other receivables 106 117
-------- ------------
Trade and other payables 13,416 1,671
-------- ------------
8. Segment information
The Company has two reportable segments, as described below. For
each of them, the Board of Directors receives detailed reports on
at least a quarterly basis. The following summary describes the
operations in each of the Company's reportable segments:
-- Fund investments: includes commitments/investments in five private equity funds.
-- Direct investments and loans: includes direct equity
investments, loans to the Funds' portfolio companies, loans to the
Funds and other loans.
Balance sheet and income and expense items which cannot be
clearly allocated to one of the segments are shown in the column
"Unallocated" in the following tables.
The reportable operating segments derive their revenue from
investments by seeking to achieve an attractive return in relation
to the risk being taken. The return consists of interest, dividends
and/or unrealised and realised capital gains.
The financial information provided to the Board of Directors
with respect to total assets and liabilities is presented in a
manner consistent with the annual consolidated financial
statements. The assessment of the performance of the operating
segments is based on measurements consistent with IFRS. With the
exception of capital calls payable, liabilities are not considered
to be segment liabilities but rather managed at the corporate
level.
There have been no transactions between the reportable segments
during the period ended 30 June 2019 and 30 June 2018.
The segment information for the period ended 30 June 2019 is as
follows:
Direct investments Total operating
Fund investments and loans segments Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Net realised gains
on financial assets
at fair value through
profit and loss 17,840 - 17,840 - 17,840
---------------- ------------------ --------------- ----------- ---------
Net unrealised gains/(losses)
on financial assets
at fair value through
profit and loss 58,536 13,518 72,054 - 72,054
---------------- ------------------ --------------- ----------- ---------
Interest income - 4,487 4,487 56 4,543
---------------- ------------------ --------------- ----------- ---------
Net foreign currency
gains/ (losses) - - - (286) (286)
---------------- ------------------ --------------- ----------- ---------
Other income - 520 520 - 520
---------------- ------------------ --------------- ----------- ---------
Expenses - - - (13,211) (13,211)
---------------- ------------------ --------------- ----------- ---------
Profit/(loss) for the
period 76,376 18,525 94,901 (13,441) 81,460
---------------- ------------------ --------------- ----------- ---------
Total assets 394,286 160,737 555,023 109,300 664,323
---------------- ------------------ --------------- ----------- ---------
Total liabilities - - - (13,416) (13,416)
---------------- ------------------ --------------- ----------- ---------
Net assets 394,286 160,737 555,023 95,884 650,907
---------------- ------------------ --------------- ----------- ---------
Total assets include:
---------------- ------------------ --------------- ----------- ---------
Financial assets at
fair value through
profit and loss 394,286 160,737 555,023 - 555,023
---------------- ------------------ --------------- ----------- ---------
Cash and others - - - 109,300 109,300
---------------- ------------------ --------------- ----------- ---------
The segment information for the period ended 30 June 2018 is as
follows:
Direct
investments Total operating
Fund investments and loans segments Unallocated Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Net realised gains
on financial assets
at fair value through
profit and loss 92,667 - 92,667 - 92,667
---------------- ------------ --------------- ----------- --------
Net unrealised gains/(losses)
on financial assets
at fair value through
profit and loss (50,833) (12,575) (63,408) - (63,408)
---------------- ------------ --------------- ----------- --------
Interest income - 3,455 3,455 56 3,511
---------------- ------------ --------------- ----------- --------
Net foreign currency
gains/(losses) - - - 1,750 1,750
---------------- ------------ --------------- ----------- --------
Other income - 60 60 127 187
---------------- ------------ --------------- ----------- --------
Expenses - - - (2,407) (2,407)
---------------- ------------ --------------- ----------- --------
Profit/(loss) for the
period 41,834 (9,060) 32,774 (474) 32,300
---------------- ------------ --------------- ----------- --------
Total assets 281,762 99,764 381,526 149,877 531,403
---------------- ------------ --------------- ----------- --------
Total liabilities - - - (1,671) (1,671)
---------------- ------------ --------------- ----------- --------
Net assets 281,762 99,764 381,526 148,206 529,732
---------------- ------------ --------------- ----------- --------
Total assets include:
---------------- ------------ --------------- ----------- --------
Financial assets at
fair value through
profit and loss 281,762 99,764 381,526 - 381,526
---------------- ------------ --------------- ----------- --------
Cash and others - - - 149,877 49,877
---------------- ------------ --------------- ----------- --------
9. Expenses
6 months ended 6 months ended
30 Jun 2019 30 Jun 2018
GBP'000 GBP'000
Performance fees 10,116 198
-------------- --------------
Operational and advisory fees 1,719 1,234
-------------- --------------
Professional fees 714 378
-------------- --------------
Other expenses 662 597
-------------- --------------
13,211 2,407
-------------- --------------
10. Earnings per share
The earnings per share calculation uses the weighted average
number of shares in issue during the period.
6 months ended 6 months ended
30 Jun 2019 30 Jun 2018
Basic and diluted earnings per share
(pence) 40 16
-------------- --------------
Profit for the period (GBP'000) 81,460 32,300
-------------- --------------
Weighted average number of shares outstanding
('000) 204,572 204,804
-------------- --------------
11. Net asset value per share
The net asset value per share calculation uses the number of
shares in issue at the end of the period.
As at As at
30 Jun 2019 30 Jun 2018
Basic and diluted net asset value per
share (pence) 318 259
------------ ------------
Net assets attributable to shareholders
(GBP'000) 650,970 529,732
------------ ------------
Number of shares in issue at the period
end ('000) 204,400 204,804
------------ ------------
12. Share capital
The authorised share capital of the Company is 280,000,000
ordinary shares at a par value of GBP0.01 each. Ordinary shares are
listed and traded on the AIM market of the London Stock Exchange.
Each share confers the right to one vote and shareholders have the
right to receive dividends.
On 18 March 2019, the Company bought 404,100 Ordinary shares at
the market price on that date for a total of GBP767,442. The
Ordinary shares purchased by the Company were cancelled and are
available for re-issue.
As at 30 June 2019, the Company's issued and fully paid share
capital was 204,399,936 ordinary shares (2018: 204,804,036).
As at As at
30 Jun 2019 30 Jun 2018
'000 '000
Ordinary shares outstanding at the
beginning of the period 204,804 204,804
------------ ------------
Ordinary shares purchased (404) -
------------ ------------
Ordinary shares outstanding at the
end of the period 204,400 204,804
------------ ------------
13. Commitments
The Company had the following capital commitments in euros as at
the period end:
As at As at
30 Jun 2019 30 Jun 2018
EUR'000 EUR'000
Fund I
------------ --------------
Total capital commitment 2019: GBP181,214
(2018: GBP166,694) 202,398 188,398
------------ --------------
Called capital at the beginning of
the period 185,760 185,760
------------ --------------
Additional interest acquired during
the period 13,804 -
------------ --------------
Capital calls during the period 2019:
0% (2018: 0%) - -
------------ --------------
Called capital at the end of the period
2019: GBP178,677
(2018: GBP164,360) 199,564 185,760
------------ --------------
Unfunded capital commitment 2019: GBP2,537
(2018: GBP2,334) 2,834 2,638
------------ --------------
Aggregate recycled commitment 13,966 13,000
------------ --------------
As at As at
30 Jun 2019 30 Jun 2018
EUR'000 EUR'000
------------ ------------
Fund II
------------ ------------
Total capital commitment 2019: GBP170,114
(2018: GBP168,112) 190,000 190,000
------------ ------------
Called capital at the beginning of
the period 176,700 158,650
------------ ------------
Capital calls during the period 2019:
0% (2018: 9.5%) - 18,050
------------ ------------
Called capital at the end of the period
2019: GBP158,206
(2018: GBP156,344) 176,700 176,700
------------ ------------
Unfunded capital commitment 2019: GBP11,908
(2018: GBP11,768) 13,300 13,300
------------ ------------
Aggregate recycled commitment 8,550 -
------------ ------------
Fund III
------------ ------------
Total capital commitment 2019: GBP291,682
(2018: GBP288,250) 325,780 325,780
------------ ------------
Called capital at the beginning of
the period 172,663 123,797
------------ ------------
Capital calls during the period 2019:
0% (2018: 10%) - 32,578
------------ ------------
Called capital at the end of the period
2019: GBP154,591
(2018: GBP138,360) 172,663 156,375
------------ ------------
Unfunded capital commitment 2019: GBP137,091
(2018: GBP149,889) 153,117 169,405
------------ ------------
Fund IV
------------ ------------
Total capital commitment 2019: GBP358,134 400,000 -
------------ ------------
Called capital at the beginning of
the period - -
------------ ------------
Capital calls during the period 2019:
2.3% 9,000 -
------------ ------------
Called capital at the end of the period
2019: GBP8,058 9,000 -
------------ ------------
Unfunded capital commitment 2019: GBP350,076 391,000 -
------------ ------------
Total unfunded capital commitments
2019: GBP501,612
(2018: GBP163,991) 560,251 185,343
------------ ------------
The Company had the following loan commitments at the period
end:
As at As at
30 Jun 2019 30 Jun 2018
GBP'000 GBP'000
Total revolving loan facility commitments:
------------ ------------
Fund I 5,000 5,000
------------ ------------
Fund II 20,000 20,000
------------ ------------
Fund III 20,000 20,000
------------ ------------
Time Out Group plc 20,000 20,000
------------ ------------
Oakley NS (Bermuda) L.P. 33,850 7,850
------------ ------------
98,850 72,850
------------ ------------
Total unfunded loan commitments:
------------ ------------
Fund I 3,400 2,575
------------ ------------
Fund II 20,000 20,000
------------ ------------
Fund III 4,198 20,000
------------ ------------
Time Out Group plc - 20,000
------------ ------------
Oakley NS (Bermuda) L.P. 1,403 1,637
------------ ------------
29,001 64,212
------------ ------------
14. Related parties
Balances and transactions between the Company and its subsidiary
have been eliminated on consolidation and are not disclosed in this
note. Related parties as disclosed below are not part of the
consolidation, and for this reason are not eliminated.
One Director of the Company, Peter Dubens, is also a Director of
the Investment Adviser and Oakley Advisory Limited, entities which
may provide services to, and may receive compensation from, the
Company. These are considered related parties to the Company given
the indirect control this Director has over these entities. Peter
is the sole shareholder of Oakley Capital Manager Limited (the
"Administrative Agent") and is considered a related party to the
Company given the direct control this Director has over this
entity.
The agreements between the Company and these service providers
were, and are based on normal commercial terms. Throughout the
period ending 30 June 2019, no Director of the Company had a
personal interest in any transaction of significance for the
Company (2018: none).
Operational fees, advisory fees and performance fees paid to the
Administrative Agent are disclosed in Note 9. The basis for
calculating these fees remain unchanged from prior periods. The
increase is a function of the change in net asset value of the
underlying assets. Under the Operational Services Agreement, the
Administrative Agent currently recharges costs incurred, either
directly or indirectly by its contracted advisors, primarily the
Investment Adviser, on behalf of the Company. For the period ending
30 June 2019, the Administrative Agent recharged such costs to the
Company totalling GBP287,726 (2018: GBP367,793) which is included
in other expenses (Note 9). The agreements between the Company and
these service providers are based on normal commercial terms.
15. Events after balance sheet date
On 1 July 2019, the Company agreed to consolidate all of the
outstanding balances, including accrued interest, of its loans to
Fund I. The Company entered into a GBP8,110,071 loan facility
agreement, repayable 30 June 2020.
On 18 July 2019, the Company announced its intention to apply
for admission of its Ordinary shares to the Specialist Fund Segment
("SFS") of the London Stock Exchange's ("LSE") Main Market. The
Ordinary shares were admitted to the SFS, to commence trading on
the Main Market and simultaneously cease trading on AIM on 23
August 2019. The Company's ticker symbol continues to be "OCI".
On 18 July 2019, the Company amended and restated the
Operational Services Agreement. A number of administrative updates
have been made to that agreement together with certain other
amendments. The fees payable remain the same under the new
agreement save that, from 1 January 2020, the operational and
advisory fee of 2% will be charged only on equity co-investments
(as opposed to all co-investments). The new Operational Services
Agreement took effect with the Company's admission to the SFS of
the LSE Main Market.
On 9 August 2019, the Company paid a capital call of
EUR32,578,000 (GBP29,672,042) to Fund III.
On 10 September 2019, the Board of Directors declared and
approved payment of an interim dividend of 2.25 pence per ordinary
share which will result in a dividend payment of GBP4,608,091
payable on 24 October 2019.
Several minor amendments to terms and amounts of co-invest loans
were made subsequent to the period end in the normal course of
business.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
IR SFDESSFUSEIU
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