Graphite Enterprise has one of the lowest investment levels among private equity investment trusts, with cash equal to around 30 per cent of its assets. This position is usual for the trust, which has opted for a cautious strategy.
While this means Graphite Enterprise has has lagged its peers over some shorter periods, its net asset value (NAV) held up much better during the financial crisis, and over 20 years it has beaten the FTSE All Share by 6.3 percentage points each year on average.
Despite this strong long-term record, the investment trust's share price fell with its sector during the financial crisis and is still far lower than its performance and prospects merit, trading at a discount to NAV of around 30 per cent, making the trust a potential bargain buy for long-term investors.
Graphite Enterprise is now looking to become more fully invested. Although it has no debt, it entered into a banking facility provided by RBS on 1 April providing it with £30m of liquidity, in addition to a number of recent realisations.
Graphite invests in third-party funds for access to overseas and UK assets, and UK companies with a value of between £25m and £200m via its own funds and directly. The UK is its largest geographic exposure accounting for nearly half the fund, followed by significant exposure in France (12.4 per cent) and North America (10.2 per cent).
In total the fund is exposed to 294 underlying companies.
GRAPHITE ENTERPRISE (GPE) | |||
|---|---|---|---|
| PRICE | 374p | NAV | 534p |
| MARKET CAP | £270m | PRICE DISCOUNT TO NAV | 30.88% |
| No OF HOLDINGS: | 65* | 1 YEAR NAV PERFORMANCE | 15.46% |
| SET UP DATE | 15-Jul-81 | 3 YEAR NAV PERFORMANCE | 3.73% |
| MANAGER START DATE | 15-Jul-81 | 5 YEAR NAV PERFORMANCE | 33.49% |
| TOTAL EXPENSE RATIO | 1.31% | GEARING | 100% |
| YIELD | 0.60% | MORE DETAILS | www.graphite-enterprise.com |
Source: Investors Chronicle, *Graphite Enterprise.
Performance data as at 6 June 2011.
Top ten underlying holdings
| Holding | Percentage |
|---|---|
| Wagamama | 4.8 |
| Micheldever | 4.4 |
| Kwik-Fit | 2.4 |
| Kurt Geiger | 2.1 |
| Preh | 2 |
| Park Holidays | 2 |
| U-POL | 1.9 |
| Hellerman Tyton | 1.5 |
| Standard Brands | 1.4 |
| NES Group | 1.4 |
At 31 January 2011
Sector breakdown
| Sector | Percentage |
|---|---|
| Business services | 25.1 |
| Consumer goods and services | 15.7 |
| Manufacturing and engineering | 14.1 |
| Leisure | 13.1 |
| Healthcare and education | 9.4 |
| Financial services | 5.8 |
| Retailing | 5.2 |
| Construction and buildings supplies | 2.9 |
| Infrastructure | 2.6 |
| Media | 2.6 |
| Other | 3.5 |
