14
March 2024
Oakley Capital Investments
Limited
Final results for the Year
Ended 31 December 2023
Oakley Capital Investments
Limited1 ("OCI" or the "Company") today announces its
final results for the year ended 31 December 2023. OCI is a listed
investment company providing consistent, long-term returns in
excess of the FTSE All-Share Index by investing in funds managed by
Oakley Capital2 ("Oakley").
The Oakley Funds3 invest
primarily in unquoted, profitable, pan-European businesses with
recurring revenues, and across four focus sectors. Oakley's
origination capabilities with proven value creation drivers help
management teams accelerate growth and produce consistently
superior returns for investors.
Strong growth and investment
activity in a period of macroeconomic uncertainty
Highlights for the year ended 31 December
2023
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Net Asset Value ("NAV") per share of
684 pence and NAV of £1,207 million
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Total NAV return per share,
including dividends, of 4% (+27 pence), or c.6% before the impact
of foreign exchange
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Total shareholder return of
18%
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Investments of £175 million and
share of proceeds of £266 million
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Outstanding commitments of £1,015
million
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Year-end cash and available credit
facilities of £382 million
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Final dividend of 2.25 pence, taking
dividends declared to 4.5 pence
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Portfolio highlights
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Average portfolio company
year-on-year EBITDA growth of 14% (2022: 22%)
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Average portfolio company valuation
multiple (EV/EBITDA) of 16.4x (2022: 15.9x)
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Portfolio value increase was driven
65% by EBITDA growth, and 35% by multiple expansion
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Average net debt/EBITDA ratio of
4.2x (2022: 4.3x)
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The key drivers of NAV growth
were:
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IU Group (+10 pence): enrolments
grew 30%+ to 140,000+ students
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North Sails (+9 pence): revenue and
profits hit record and ahead of target
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Idealista (+7 pence): strong results
across core markets in Southern Europe
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Foreign exchange: (-12 pence): 2+%
change in EUR:GBP
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Portfolio overview
OCI's portfolio of private equity
investments delivered robust trading during the period:
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Earnings - an average 14% organic
EBITDA growth demonstrates the portfolio's ability to sustain
performance through economic cycles
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Valuations - the average valuation
multiple modestly increased to 16.4x, partially reflecting strength
in peer multiples. The 4% increase in total NAV reflects a cautious approach to
trading outlook and portfolio company valuation
multiples
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Leverage - average net debt/EBITDA
declined to 4.2x which compares to a private equity industry
average of between 6 to 7x
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Read more about the Portfolio's
performance in the Annual Report
here.
Proceeds
OCI's look-through share of proceeds
from exits and refinancings during the year totalled £266 million,
consisting of:
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Realisations - £240 million - IU
Group at gross return of 85% IRR
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Refinancings - £26 million -
idealista and Cegid completed debt refinancings
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Investments
OCI made a total look-through
investment of £175 million which included:
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New platform deals - £50 million -
Thomas' London Day Schools, Liberty Dental Group and
Webcentral
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Reinvestment - £66 million - IU
Group, benefitting from the next phase of the company's growth
which is focused on leveraging AI and
internationalisation
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Follow-on investments - £35 million
- in addition to vLex's acquisition of Fastcase, and the
acquisition of 7Mind by 7NXT which owns and operates fitness
platform Gymondo, 22 bolt-on acquisitions were completed by
portfolio companies
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Venture investments - £24 million -
investments in Oakley Touring Venture Fund and PROfounders III
portfolio companies
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Read more about OCI's new
investments in the Annual Report
here.
Post balance-sheet events
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Further new platform deals - c.£80
million - investments in Alerce and Steer Automotive
Group These transactions
are expected to complete within H1 2024.
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Direct investments
The Board continues to work towards
the resolution and value maximisation of OCI's two direct
investments of Time Out and North Sails. Developments in 2023
included: the receipt of an in-specie dividend of Time Out shares
from the ongoing closure of Fund I which rationalised OCI's Time
Out holdings in a single direct stake, giving greater autonomy over
the holding; and converting OCI's outstanding North Sails loans and
accrued interest into preferred equity. This was done alongside a
wider organisational and capital restructure of the North Sails
Group which improves OCI's overall security, creates an incentive
for redemption and helps simplify the North Sails' capital
structure, enhancing the attraction of the business to future
investors. Time Out recently publicly reported strong half year
results while North Sails delivered another record year for
2023.
Read more about OCI's direct
investments in the Annual Report
here.
Cash & commitments
OCI made a total commitment of $100
million in Oakley Touring Venture Fund and €190 million in Origin
II, taking the total outstanding commitments to the Oakley Funds to
£1,015 million as at 31 December 2023. This will be deployed into
new investments over the next five years. OCI's total liquidity as
at 31 December 2023 was £382 million, comprising £207 million of
cash on the balance sheet and £175 million in undrawn credit
facilities. The Board closely monitors anticipated fund drawdowns
and projected liquidity and will continue its long-term commitment
to share buybacks when appropriate.
See OCI's Balance Sheet in the
Annual Report
here.
Outlook
The underlying portfolio is expected
to continue generating strong earnings growth in spite of the
prevailing macroeconomic uncertainty, while investment activity is
anticipated to remain robust after a busy period:
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Portfolio companies continue to
benefit from long-term trends including the consumer shift to
digital search and spend, businesses' shift to the cloud and to
outsourcing, and resilient demand for education and
up-skilling
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There remains a strong environment
for new investment opportunities with five new deals signed in the
last four months, laying the foundations for future earnings and
NAV growth
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OCI's enhanced balance sheet and
liquidity means it can fully participate in the Investment
Adviser's strong pipeline with opportunities in due diligence
weighted towards Southern and Western Europe, and Technology,
Education and Business Services sectors
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Caroline Foulger, Chair of Oakley Capital Investments,
commented:
"It is testament to the resilience
of the underlying portfolio and Oakley's active management that, in
spite of the unsettled nature of the global economy, the Company
continued to deliver. Most importantly, total shareholder return
was 18%, taking the annualised five-year total shareholder return
to 24%. OCI continues to offer one of the most accessible ways to
gain exposure to pan-European private equity through one of the
industry's best performing managers."
Peter Dubens, Managing Partner of Oakley Capital,
commented:
"We are in a period of sustained
uncertainty, triggered by macroeconomic volatility but also
technological disruption not least with the advent of generative
AI. While this can create challenges for our portfolio companies
and the entrepreneurs we partner with, it can also create
opportunities. Many of our existing investments are already
leveraging AI to boost productivity and, in some cases, to
completely pivot their business models.
"Meanwhile, our approach to
partnership and strong track record in value creation continue to
make Oakley the partner of choice for ambitions founders and
management teams who are building disruptive leaders in often
highly fragmented markets."
The Annual Report and Accounts are
available on the Company's website at https://www.oakleycapitalinvestments.com/2023-annual-report/
A video overview of the 12-month
performance is also available here https://www.oakleycapitalinvestments.com/news-and-media/videos/
The Company's Q1 2024 trading update
is expected to be released on 24 April 2024.
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Results presentation
A live presentation of the
results, delivered by Oakley Capital
Partner Steven Tredget, will take
place at 9:00am today, Thursday 14 March 2024. The presentation will be
available to view via video webcast at the following link:
https://www.investis-live.com/oakley-capital/65d47bebd0d520120031aad6/ozre
Dividend
The final dividend declared in
respect of the year ended 31 December 2023 is 2.25 pence per share
(following the interim dividend of 2.25 pence, bringing the
full-year dividend to 4.5 pence per share.)
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Ex-dividend date
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14 March 2024
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(date from which shares are
transferred without dividend)
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Record date
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22 March 2024
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(last date for registering transfers
to receive the dividend)
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Dividend payment date
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26 April 2024
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For further information please
contact:
Oakley Capital Limited
+44 20 7766 6900
Steven Tredget
Greenbrook Communications
Limited
+44 20 7952 2000
Rob White / Michael
Russell
Deutsche Numis (Financial Adviser
& Broker)
+44 20 7260 1000
Nathan Brown / Matt Goss
Notes:
LEI Number:
213800KW6MZUK12CQ815
1 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.
2 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.
3 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, Oakley Capital V,
Oakley Capital Origin Fund and Oakley Capital Origin II, 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. The Oakley family of
funds also includes Oakley PROfounders Fund III and Oakley Touring
Venture Fund, which are venture capital funds focused on
investments in entrepreneur-led, disruptive, technology led
companies.
For more information on the Oakley
Fund strategies in which OCI invests, please
click here.
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.