Investment firm SVG Capital, which has stakes in fashion firm Hugo Boss and Birds Eye frozen food firm Iglo, saw its net asset value per share increase by one-sixth in the first quarter of 2012.
Net asset value (NAV) per share roses 16.6% during the quarter to 393.2p, excluding the December 2011 unaudited directors' valuation of SVG Advisers and SVG Investment Managers of 13.9p per share. With those elements thrown in, NAV rose 16.3% to 407.1p.
The value of its Hugo Boss/VFG investment rose £54.5m during the quarter to £315.4m, representing a tidy paper profit on its original investment of £205.5m. The value of the holding was written up after the fashion line reported strong sales and earnings growth, while the group also a higher earnings multiple to the valuation.
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Casino operator Galaxy Entertainment saw a share price gain of more than 50% during the quarter which saw SVG's stake rise in value by £55.7m to £175.8m, more than four times the original cost of the stake.
Net debt at the end of the quarter stood at £187.3m, representing 16.5% of adjusted shareholders' funds. The company stumped up £2.1m during the quarter to answer cash calls from its investments but this was more than outweighed by dividend income of £13.8m during the period.
Uncalled commitments stood at £167.4m at the end of March. Of this, some £135.0m is expected to be called and this compares with available liquidity of £263.5m - giving a coverage ratio of 2.0.
At March 31st, 2012, the company's loan to value (LTV) ratio was 12.1%, well below the maximum permitted LTV of 30%.
Given the uncertain economic environment, the group's investment manager, Permira, is cautious on the outlook. "Whilst the portfolio's revenue streams are well diversified with an increasing exposure to higher growth economies, visibility on the operating environment continues to be limited," the company statement said.
"As anticipated, distributions from the portfolio were muted in the quarter. We have a portfolio of high quality and maturing assets. However, given the continued uncertainty of the macro-economic outlook, the specific timing of future distributions is difficult to predict with any certainty," the company said.
The shares edged up 2p to 292.3p on the update, having reached a new 52-week high of 300p in the first half hour of trading.
JH
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