News

Interim Results for the Six Months ended 30 June 2023

Oakley Capital

14.09.23

3 min read

Oakley Capital Investments Limited ("OCI" or the "Company") is pleased to announce its interim results for the six months ended 30 June 2023. 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, profitable, pan-European businesses with recurring revenues, and across four sectors: Technology, Consumer, Education and Business Services. Oakley's origination capabilities combined with proven value creation drivers help management teams accelerate growth and produce consistently superior returns for investors.  

Watch interview with Oakley Capital Partner, Steven Tredget to find out more.

Resilient NAV and strengthened balance sheet

Highlights for the six months ended 30 June 2023

Net Asset Value (“NAV”) per share of 663 pence and NAV of £1,169 million
Total NAV return per share, including dividends, of 0.5% since 31 December 2022 (+3 pence)
Total shareholder return of 5.3%
Additional investments made of £96 million and share of proceeds of £240 million
Net cash of £248 million
Total outstanding Oakley Fund commitments of £893 million
Undrawn revolving credit facility extended and increased to £175 million post-period end
Half-year dividend of 2.25 pence to be paid on 20 October 2023 to shareholders on the register on or before 22 September 2023

Portfolio highlights

Average portfolio company year-on-year EBITDA growth

21%

FY22:22%

Average portfolio company valuation multiple (EV/EBITDA)

16.9x

FY22:15.9x

Average portfolio company net debt/EBITDA ratio

4.0x

FY22:4.3x

The key drivers of NAV were:

Portfolio companies (+17 pence): valuation gains in the underlying investments, with Idealista and Time Out being the largest contributors
Foreign exchange impact (-15 pence): 3% change in EUR:GBP

Read our full report

Interim report & accounts 2023

Portfolio overview

A resilient portfolio of tech-enabled businesses continued to perform well.

Growth

An average 21% organic EBITDA growth demonstrates the ability of a largely digitally disruptive portfolio to take market share, countering the impact of macro-economic weakness

Valuation

An increase in the averagevaluation multiple to 16.9x reflects the portfolio activity in the period, leading to a greater weighting towards the higher rated Technology The modest increase in asset value reflects the Company’s cautious approach to trading outlook and valuation multiples and the fact that half of the NAV was not subject to change in the period. This is the result of approximately 50% of the asset value being held in cash, or investments that were valued based upon a transaction in the last twelve months

Leverage 

A fall in average net debt/EBITDA to 4.0x underlines the portfolio company earnings growth and Oakley’s prudent approach to leverage. Of realised returns to date only 1% has been attributable to the use of debt, in contrast to organic earnings growth which has accounted for 65%

Proceeds

OCI’s share of proceeds from realisations totalled £240 million. The primary contribution was Fund III’s disposal of IU Group, the largest and fastest growing university in Germany, and a global leader in education technology.

Investments

During the period, OCI made a total look-through investment of £96 million comprising:

IU Group (Fund V) - £66 million – Reinvestment to benefit from the next phase of the Group’s growth, focusing on accelerated internationalisation, to further its vision of democratising education

Thomas’s London Day Schools (Fund IV) - £14 million – a top rated group of co-educational independent schools in London

vLex (Origin Fund) - £7 million – bolt-on acquisition of Fastcase, a leading US intelligence business, to form the world’s largest law firm subscriber base

Affinitas Education (Fund IV) - £2 million – bolt-on acquisition of XIC, a single-site school in Spain, which brings the total group to 12 schools, educating more than 10,000 students

OCI also made £1 million of look-through investments in PROfounders III portfolio companies during the period.

Cash & commitments

A significant growth in liquid resources in the period:

Cash – OCI’s net cash grew 126% to £248 million as at 30 June 2023
Credit facility – post-period end, OCI renewed and expanded its revolving credit facility, raising total committed lending to £175 million for a two-year term. As at 13 September 2023, the facility was undrawn
Commitments – following OCI’s $100 million commitment to Oakley Touring Venture Fund during the period, OCI’s total outstanding commitments to the Oakley Funds amounted to £893 million. This is expected to be deployed into new investments over the next five years

Outlook

The outlook for the global economy will remain uncertain in the period ahead, which will present challenges, but also opportunity. Oakley has decades of experience investing through economic cycles, and Oakley’s active management, and proven value creation strategies are expected to continue driving NAV growth:

The portfolio of 27 European businesses continues to profit from long-term megatrends including the shift to online solutions by businesses and consumers, and the demand for mission-critical, tech-enabled services
Oakley continues to demonstrate its forward thinking and innovation, exploring new technologies such as AI and developing new sectors such as Business Services
Enhanced balance sheet liquidity to take advantage of a significant period of investment opportunities