Private equity investment trust Candover Investments is promising jam tomorrow to shareholders as it slowly progresses to a position where it can return cash to shareholders.
The firm saw its net asset value per share slide 12% to 717p at the end of 2011 from 814p at the end of 2010, while the trust's portfolio valuation was down 4.4% over the year, with first half valuation uplifts counter-balanced by the volatile economic environment and adverse currency movements in the second half.
A significant downward valuation in Expro International, where earnings have been affected by an agonisingly slow recovery in activity, had a marked impact on net asset value, as have market valuations of companies in Candover's portfolio (based on the earnings multiples of listed comparable companies).
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On a constant currency basis six of the 13 portfolio investments saw their value written up, four were unchanged and three were written down.
Outstanding commitments to the 2005 investment fund at December 31st were £14.9m, compared to £38.9m at the end of 2010. The firm said the reduction reflects the impact of follow-on investments made during the year, together with the transfer of part of the liability to the strip purchaser. These commitments expire on 26th August 2013.
Chief Executive Officer Malcolm Fallen said: "Candover is now positioned to undertake a progressive return of cash to shareholders when portfolio realisations are accomplished by Arle and a net cash position has been achieved.
"While the continuing market uncertainty may slow both the growth in value of
the portfolio and the pace of realisations achievable by Arle in the near term,
the proceeds received post the year-end from the sale of Capital Safety Group
reduce net debt on a pro-forma basis to £8.8 million, which means we are a step
further along our path as we start 2012."
As might be deduced from the above, the board is not recommending a dividend payment.
The share price fell 2.83% to 480.00p by 13:54.
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