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10 March 2022
Oakley Capital Investments Limited
Final results for the Year Ended 31 December 2021
Oakley Capital Investments Limited ("OCI" or the "Company") today announces its final results for the year ended 31 December 2021. OCI is a listed investment company providing consistent, long-term returns in excess of the FTSE All-Share Index by investing in the funds managed by Oakley Capital ("Oakley"), thereby capturing the outperformance of a leading private equity manager.
The Oakley Funds invest primarily in unquoted, pan-European businesses across three sectors: Technology, Consumer and Education. Oakley leverages its unique business founder network to source attractive investment opportunities and then applies proven value creation strategies to accelerate sustainable growth.
Strong earnings and realisations drive significant NAV growth and propel net assets to £961m. £163m cash available for new investments, with fresh commitments made to fund future growth.
Financial Highlights
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Net Asset Value ("NAV") per share of 538 pence and NAV of £961 million |
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Total NAV return per share of 35% (+140 pence) |
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Total shareholder return of 48% |
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Investments of £137 million and share of proceeds of £121 million |
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Year-end cash of £163 million |
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Outstanding commitments of £404 million, with an additional €400 million (£336 million1) committed to Fund V post year-end |
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Buy-back and cancellation of 2 million shares |
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Full-year dividend of 2.25 pence to be paid on 14 April 2022 to shareholders on the register on or before 25 March 2022 |
Portfolio Highlights
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Average portfolio company year-on-year EBITDA growth of 28% (2020: 20%) |
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Average portfolio company valuation multiple (EV/EBITDA) of 13.9x (2020: 11.8x) |
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Portfolio value increase was 76% driven by EBITDA growth and 24% by multiple expansion |
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Average net debt/EBITDA ratio of 4.2x (2020: 3.9x) |
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The key drivers of NAV growth were: |
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IU Group (+52 pence) - continued, global growth in enrolments for their online university courses |
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TechInsights (+24 pence) - sale of business at 131% premium to book value |
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Wishcard Technologies Group (+10 pence) - Europe's leading gifts & rewards platform sold nine million gift cards |
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Foreign exchange (-22 pence) - 6.5% change in GBP:EUR |
Proceeds
OCI's share of proceeds from realisations, refinancings and repayment of loans totalled £121 million, consisting of:
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Refinancings: IU Group - £65 million, Contabo - £13 million, 7NXT - £5 million |
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Daisy Group - £22 million from OCI loan repayment and partial investment realisation |
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ACE Education - £16 million from Fund III's investment realisation (2.1x Gross MM) |
Investments
During the period, OCI made a total look-through investment of £137 million which, aside from some follow-on investments, was attributable primarily to six platform deals:
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idealista (Fund IV) - £43 million - Southern Europe's leading property portal |
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Dexters (Fund IV) - £13 million - London's premier independent estate agents |
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ICP Education (Fund IV) - £27 million - leading independent group of U.K. based children's nurseries |
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ECOMMERCE ONE (Origin) - £6 million - provider of ecommerce software in German-speaking Europe |
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ACE Education (Origin) - £10 million - reinvestment in the international vocational higher education platform |
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Seedtag (Origin) - £7 million - fast-growing provider of contextual advertising solutions |
Follow-on investments totalled £31 million comprising Windstar Medical (Fund IV), Grupo Primavera and Globe-Trotter (Fund III), and North Sails (Fund II and direct investment). During the period, OCI also completed the buyback and cancellation of two million shares at an average price of 354 pence per share, resulting in a NAV uplift of c.1 pence. The OCI Board remain committed to its share buyback programme.
Cash & commitments
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Balance sheet - OCI had £163 million in cash at 31 December 2021, equal to 17% of NAV, and no debt |
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New fund commitment - on 26 January 2022, OCI announced an initial €400 million commitment (£336 million1) to Fund V, the successor to Oakley Capital Fund IV that is effectively c.75% invested. This will be deployed into new Fund V investments over the next five years, funded with existing balance sheet cash as well as expected proceeds from future realisations |
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Total outstanding commitments - outstanding Oakley Fund commitments at the year-end were £404 million, increasing to £740 million when including the initial commitment to Fund V announced post year-end |
Post year-end transaction
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The sale of TechInsights at a 131% premium to NAV was completed post-year end. The exit generated a c.19x return and c.82% IRR for Fund III. As part of the transaction, Fund IV reinvested in the business to benefit from its strong future growth potential. OCI's share of proceeds was c.£60 million |
Outlook
High earnings growth and a promising pipeline of investments and realisations position Oakley and OCI for strong NAV progression in the year ahead:
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The resilient, tech-enabled portfolio continues to benefit from long term structural tailwinds, even during periods of volatility |
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Cash and anticipated proceeds allow OCI to fully participate in the exciting new opportunities that Oakley provides |
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Strong demand for its highly-attractive portfolio companies validates Oakley's investment strategy, and underpins future returns |
To date, there has been no material impact on Oakley or on its portfolio companies from the war in Ukraine or from new sanctions imposed on Russia and Belarus. Oakley continues to closely monitor the situation.
The Company has now adopted a quarterly reporting schedule, with a Q1 trading update expected to be released on 27 April 2022.
The Annual Report and Accounts are available on the Company's website:
https://oakleycapitalinvestments.com/investor-centre/publications/
A video overview of the 12-month performance is also available here:
https://oakleycapitalinvestments.com/videos/
Caroline Foulger, Chair of Oakley Capital Investments Limited, commented:
"I am delighted that OCI has continued to deliver on its long-term strategy, generating impressive shareholder returns. The portfolio of tech-enabled businesses sustained their pattern of strong earnings growth and this, together with realisations, drove a significant uplift in NAV. Looking ahead, the Board remains very confident about the Investment Adviser's origination and value creation strategies, and is pleased to confirm our commitment to Oakley Capital's latest fundraise."
Peter Dubens, Managing partner of Oakley Capital Limited, commented:
"At a time of heightened market volatility and uncertainty, we remain focused on applying the unique Oakley capabilities that have consistently delivered strong outcomes for all our stakeholders: leveraging our network to back the best founders and businesses, harnessing our track record to invest behind long-term megatrends, and applying our expertise to maximise value creation across our portfolio companies."
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Results presentation
A live presentation of the results, delivered by Oakley Capital Partner Steven Tredget, will take place at 09:00 GMT today, Thursday 10 March 2022. The presentation will available to view via video webcast at the following link: https://www.investis-live.com/oakley-capital/621e58c5f73bbc2300ab2589/ddvzz
For further information please contact:
Oakley Capital Limited
+44 20 7766 6900
Steven Tredget, Investor Relations
Greenbrook Communications Limited
+44 20 7952 2000
Alex Jones / Michael Russell
Liberum Capital Limited (Financial Adviser & Broker)
+44 20 3100 2000
Chris Clarke / Darren Vickers / Owen Matthews
Notes:
LEI Number: 213800KW6MZUK12CQ815
1 Based on FX rates (USD:EUR 0.89; EUR:GBP 0.84) as at the date of announcement, 25 January 2022.
About Oakley Capital Investments Limited ("OCI")
OCI is a Specialist Fund Segment ("SFS") traded investment vehicle that aims to provide shareholders with consistent long-term capital growth in excess of the FTSE All-Share Index by providing liquid access to private equity returns through investment in the Oakley Funds.
A video introduction to OCI is available at https://oakleycapitalinvestments.com/videos/
The contents of the OCI website are not incorporated into, and do not form part of, this announcement.
Oakley Capital, 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.
The Oakley Funds
Oakley Capital Private Equity L.P. and its successor funds, Oakley Capital Private Equity II, Oakley Capital Private Equity III, Oakley Capital IV and Oakley Capital Origin Fund are unlisted lower-mid to mid-market private equity funds that aim to provide 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.
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 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.
This announcement may include "forward-looking statements". These forward-looking statements are statements regarding the Company's objectives, intentions, beliefs or current expectations with respect to, amongst other things, the Company's financial position, business strategy, results of operations, liquidity, prospects and growth. Forward-looking statements are subject to risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Accordingly the Company's actual future financial results, operational performance and achievements may differ materially from those expressed in, or implied by, the statements. Given these uncertainties, prospective investors are cautioned not to place any undue reliance on such forward-looking statements, which speak only as at the date of this announcement. The Company expressly disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect actual results or any change in the Company's expectations with regard to them or any change in events, conditions or circumstances on which any such statements are based unless required to do so by the Financial Services and Markets Act 2000, the Listing Rules or Prospectus Regulation Rules of the Financial Conduct Authority or other applicable laws, regulations or rules.