Draper Esprit (GROW) wants to change investors’ perception of venture capital from that of "a lottery ticket, to more of a premium bond”, says chief executive Simon Cook. But even without government backing, management certainly seems to have an eye for a good investment – the fair value of the group’s portfolio increased by a fifth, hitting the full-year target rate at the half-way mark, which helped boost the venture capital specialist’s net asset value (NAV) – excluding goodwill – to 444p a share.
The group invested in 11 new companies and increased its investment in six others, deploying a total of £65m and a further £11m from the enterprise investment scheme and venture capital trust funds. Investments included £10m in cloud-based call centre software provider Aircall and £7m in fintech company Revolut. Management aims to invest £100m annually, in addition to one-off acquisitions, as borne out by the £26m post-period-end deal to acquire DFJ Europe X fund, which increased stakes in existing portfolio companies.
A strategic partnership with German-based investor Earlybird Digital West was announced in July, which management hopes will give it greater access to early-stage European investments. More than £1.5m has been invested in five new companies via that agreement so far.
Analysts at Numis expect adjusted NAV of 484p a share at the March 2019 year-end, up from 404p in FY2018.
| DRAPER ESPRIT (GROW) | ||||
| ORD PRICE: | 535p | MARKET VALUE: | £ 530m | |
| TOUCH: | 535-555p | 12-MONTH HIGH: | 650p | LOW: 370p |
| DIVIDEND YIELD: | NIL | PE RATIO: | 6 | |
| NET ASSET VALUE: | 454p | NET CASH: | £104m | |
| Half-year to 30 Sep | Fee income (£m) | Pre-tax profit (£m) * | Earnings per share (p) | Dividend per share (p) |
| 2017 (restated) | 1.3 | 18.7 | 26 | nil |
| 2018 | 2.5 | 39.2 | 39 | nil |
| % change | +92 | +110 | +50 | - |
| Ex-div: | na | |||
| Payment: | na | |||
| * Includes unrealised gains on investments | ||||
