A sharp fall in equity values pulled private equity investor 3i into the red in the six months to end-September, with last year's unrealised gains of £196m having been turned into a £441m devaluation. Accordingly, there was a 15.6 per cent negative return on shareholders' funds. And, while total assets under management rose from £9.3bn a year earlier to £12.3bn, this was down from £12.7bn at the March year-end.
However, the underlying picture was brighter, with realised gains edging ahead from £30m to £31m while portfolio income held steady at £79m. And, on a value-weighted basis, the portfolio generated earnings growth of 8 per cent. Total investment rose from £327m to £448m, too. 3i has also worked hard to strengthen the balance sheet so that it can more effectively ride through the current downturn. Indeed, from a peak of £1.9bn in March 2009, net debt has been reduced to £531m. Net operating expenses have also been reduced, from £59m to £55m, and the group has undrawn facilities totalling £1.7bn.
Dividend policy has also been significantly rebased, and management is now proposing to pay a total pay-out for the current year of 8.1p a share, up from 3.6p last year.
| 3i GROUP (III) | ||||
|---|---|---|---|---|
| ORD PRICE: | 204p | MARKET VALUE: | £1.98bn | |
| TOUCH: | 204-205p | 12-MONTH HIGH: | 346p | LOW: 181p |
| DIVIDEND YIELD: | 2.5% | PE RATIO: | na | |
| DISCOUNT TO NAV: | 31% | NET DEBT: | 19% | |
| Half-year to 30 Sep | Net asset value (p) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2010 | 332 | 54.0 | 5.50 | 1.20 |
| 2011 | 296 | -497 | -52.7 | 2.70 |
| % change | -11 | - | - | +125 |
Ex-div: 7 Dec Payment: 11 Jan | ||||
