The search for higher returns in a low-yielding environment has been a common cause for pension funds and other institutional investors. As a specialist investor in alternative assets such as real estate and mezzanine debt, Intermediate Capital (ICP) has benefited from this demand. The group has continued its strategic shift towards fund management activities, focusing on newer strategies including the strategic secondaries fund - specialising in restructuring existing private equity funds - which raised €162m (£140m) in new cash during the period.
In the meantime, the larger European funds have reached almost full capacity: the ICG Longbow Fund IV, which invests in property, reached its maximum £1bn size. As a result, fundraising was slower during the period, with the fund management company gaining €1.4bn in new money, against €3.2bn in the prior comparable period. An increase in assets under management for the capital markets and real assets strategies boosted third-party fee income by more than a quarter to £63m.
Meanwhile, capital gains on Intermediate's balance sheet investments doubled to £126m, boosting investment income by a third to £190m. This allowed the company to invest £146m in its own strategies during the period.
Analysts at Numis expect adjusted pre-tax profits of £142m and EPS of 43.3p for the year to March 2017, down from £176m and 48p the previous year.
INTERMEDIATE CAPITAL GROUP (ICP) | ||||
|---|---|---|---|---|
| ORD PRICE: | 670p | MARKET VALUE: | £1.94bn | |
| TOUCH: | 669.5-670p | 12-MONTH HIGH: | 699p | LOW: 446p |
| DIVIDEND YIELD: | 3.5% | PE RATIO: | 12 | |
| NET ASSET VALUE: | 368p | NET DEBT: | 90% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 229 | 94 | 24.2 | 7.2 |
| 2016 | 299 | 126 | 37.4 | 7.5 |
| % change | +31 | +34 | +55 | +4 |
Ex-div: 1 Dec Payment: 9 Jan | ||||
