Technology commercialisation and investment group Imperial Innovations (IVO) delivered a forecast-beating performance in its latest financial year, thanks to a net £14.7m fair value gain on its investment portfolio, up from £3.3m the previous year. A record £37.9m was invested in no fewer than 29 companies, up from the £35.1m invested in 23 companies a year earlier. Overall, the value of the portfolio rose from £104.5m to £155.6m (in 82 companies) and Imperial still has over £80m available for future investment factoring in the deferred receipt of £37m from a capital raise in January 2011.
Imperial's business model is based on having priority rights to unencumbered intellectual property principally from research at London's Imperial College, but also from three other universities. These technologies are then licensed before transferring the intellectual property to a new company. And the investment portfolio has made impressive progress, notably with Veryan Medical, a company developing innovative technology to improve the performance of vascular stents and which now has a carrying value of £16.3m following a fair value gain of £5.4m. So while realisations may take time, the pipeline of work remains strong, with 51 patents filed and 377 inventions assessed.
Analyst Dr Navid Malik at brokerage Cenkos Securities expects current year pre-tax profit of £5.14m and EPS of 5.15p, five times higher than the prior estimate.
| IMPERIAL INNOVATIONS (IVO) | ||||
|---|---|---|---|---|
| ORD PRICE: | 312p | MARKET VALUE: | £311m | |
| TOUCH: | 305-319p | 12-MONTH HIGH: | 389p | LOW: 262p |
| DIVIDEND YIELD: | nil | PE RATIO: | 39 | |
| NET ASSET VALUE: | 229p | NET CASH: | £43.9m | |
| Year to 31 Jul | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2008 | 5.33 | -6.72 | -10.60 | nil |
| 2009 | 4.32 | 5.32 | 9.23 | nil |
| 2010 | 4.34 | 5.54 | 9.35 | nil |
| 2011 | 4.52 | 0.57 | 0.93 | nil |
| 2012 | 4.26 | 5.08 | 8.10 | nil |
| % change | -6 | +791 | +771 | - |
