TIDMGROW
RNS Number : 5055W
Draper Esprit PLC
26 April 2021
Draper Esprit PLC
26 April 2021
Draper Esprit Plc
("Draper Esprit", "the Group" or the "Company")
Full year trading update and notice of results
Draper Esprit (LSE: GROW, Euronext Growth: GRW), a leading
venture capital firm investing in and developing high growth
digital technology businesses, today announces an update on its
portfolio and NAV (unaudited) ahead of its final results for the
year ended 31 March 2021, which are scheduled for release on 14
June 2021.
Highlights:
-- NAV per share (unaudited) is expected to be not less than 728p (31 March 2020: 555p).
-- Gross Portfolio Value (unaudited) is expected to be not less
than GBP955 million (31 March 2020: GBP703 million).
-- Gross Portfolio increase in fair value (unaudited) is
expected to be not less than GBP330 million (47%) over the year
(year to 31 March 2020: GBP59 million).
-- Increased investment cadence with GBP96 million invested by
the Group's balance sheet ("PLC") in the second half of the year,
compared to GBP32 million in the first half, with a further GBP34
million from EIS and VCT co-investment bringing the total for the
year to GBP162 million (prior year GBP128 million)
-- Realisations in the year ended 31 March 2021 of GBP206
million (year to 31 March 2020: GBP40 million)
-- Net proceeds of GBP107 million from equity raise in October
2020, which provided significant firepower to increase our
investment cadence in the second half.
-- Available cash at year-end of GBP161 million
-- Post year-end investment as lead investor of $60 million Series B round in FintechOS.
-- Strong deal pipeline with over GBP50 million of deals
approved by the investment committee and further visibility on over
GBP75 million of near-term qualified pipeline.
Year-end 31 March 2021 (unaudited)
The fair value growth in the period reflects strong performance
across the breadth of the portfolio. Despite currency headwinds of
over GBP50 million, the fair value increase of over 47% is
significant relative to the targeted 20% annual gross portfolio
returns through the cycle. With GBP161 million of cash reflecting
the strong realisation performance in the year of GBP206 million,
the anticipated NAV per share of not less than 728p is a 31%
increase on the 555p per share at 31 March 2020.
There is significant ongoing activity within the portfolio and
therefore, relative to other year-end periods, valuations are more
than usually subject to change leading up to the final results
scheduled for 14 June 2021. The Company has noted the recent UiPath
IPO and has reflected the IPO pricing in today's unaudited
numbers.
Investments and Realisations
Full year investment of GBP128 million by PLC includes GBP51
million in primary deals (new investments), GBP34 million in
follow-on deals (existing investments), GBP31 million via Earlybird
and GBP12 million via Seed Fund of Fund investments. As intended at
the time of the equity placing in October 2020, the Company
increased the investment cadence in the second half by investing
GBP96 million, compared with GBP32 million in the first half.
Investments for the year include lead positions in earlier stage
investments Ravelin, Agora, Riverlane and Focal Point as well as
larger, later stage rounds in Cazoo, PrimaryBid, CoachHub and an
innovative Enterprise Software Company (to be announced). We have
also executed on the identified pipeline of significant follow-on
opportunities with investments into Graphcore, Endomag, M-Files and
Freetrade.
The GBP206 million of realisations includes proceeds from full
exits from Peak Games, TransferWise, and Decibel, and partial
disposals of holdings in UiPath and Trustpilot.
Focus for FY22 (to 31 March 2022)
The focus for the forthcoming year is to continue to scale the
group, both in terms of investment into the portfolio and into the
people, systems and processes around the investment team. The
increased investment cadence in the second half of FY21 has
continued into the new financial year with a pipeline of over GBP50
million of deals approved by the investment committee and a further
qualified near-term pipeline of over GBP75 million. During the past
year we have hired 6 new people into the investment team and
platform teams that support the investment function.
The investment team continues to focus on both primary and
follow on investments, identifying the growth opportunities from
across our deep network in the European market and within the
existing portfolio. It is anticipated that capital deployment for
the coming year will be over GBP150 million from the PLC balance
sheet, including further commitments being made to the Growth Fund
and Seed Fund of Funds programme, in addition to Earlybird Fund VII
and Earlybird Growth Opportunities Fund.
Progress continues with third party capital raising for the
Growth Fund, and with the acquisitions of the non-controlling
interests over the past year of Encore Ventures (the EIS manager)
and Elderstreet Investments Limited (the VCT manager) we have
continued to broaden the investor base, with additional capital
raised that co-invests alongside the PLC and further builds our
third party income.
Martin Davis, CEO Draper Esprit commented:
"The market for tech company investments has been exceptionally
strong since the pandemic, highlighting the importance of
technology to many aspects of our future. Our impressive fair value
increase reflects that, as well as the ability of our Partners to
identify companies with potential for high growth. The nature of
venture capital means that investments must be made throughout the
cycle. Today's strong returns are partly down to investments made
when things were less buoyant.
"It is gratifying to see the results of our long-term
investments continuing to be demonstrated by portfolio value and
realisations. We have been able to maximise our realisations and,
alongside our capital raise, have been able to reinvest them into
the next generation of opportunities.
"When we raised funds in October, we set goals to increase our
investment cadence significantly, to capture more investment
opportunities and take larger stakes in our established winners.
All of which we have achieved. We look forward to strengthening the
portfolio further to enable us to outperform throughout the
cycle."
-ENDs-
Enquiries
Draper Esprit plc
Martin Davis (Chief Executive
Officer)
Ben Wilkinson (Chief Financial
Officer) +44 (0)20 7931 8800
Numis Securities
Nominated Adviser & Joint Broker
Simon Willis
Richard Thomas
Jamie Loughborough +44 (0)20 7260 1000
Goodbody Stockbrokers
Euronext Growth Adviser & Joint
Broker
Don Harrington
Charlotte Craigie
Linda Clarke +44 (0) 20 3841 6202
Powerscourt
Public relations
Elly Williamson +44 (0)7970 246 725 /
Donjeta Miftari +44 (0)7961 628 862
About Draper Esprit
Draper Esprit is one of the most active venture capital firms in
Europe, investing in disruptive, high
growth technology companies. We believe the best entrepreneurs
in Europe are capable of building
the global businesses of the future. We fuel their growth with
long-term capital, access to
international networks and decades of experience building
businesses.
Currently, Draper Esprit is a shareholder in a diverse portfolio
of 67 companies with 15 of those part
of our core portfolio which accounts for over 60% of our
holdings. Our core companies include
UiPath, Aircall, Graphcore and Revolut. We invest across four
sectors: Consumer Technology,
Enterprise Technology, Hardware and Deeptech, and Digital Health
and Wellness, with highly
experienced partners constantly looking for new opportunities in
each. We look for high-growth
companies with strong IP, powerful technology, and the
management teams to deliver success.
They operate in new markets, with serious potential for global
expansion. We also look for
businesses with the potential to generate strong margins to
ensure rapid, sustainable growth in
substantial addressable markets.
Draper Esprit provides an opportunity for public market
investors to access these fast-growing tech
businesses, without having to commit to long term investments
with limited liquidity. Since IPO in
June 2016, we have deployed circa GBP550m+ capital into fast
growing technology companies and
have realised over GBP300m. In October 2020 we raised gross
proceeds of circa GBP110m to help us
capitalise on a European VC market which is expanding rapidly
but is still less than one quarter of
the combined size of the US and European market by value. It
will also allow us to capitalise on the transition to a digital
future that has been given added impetus as a result of the recent
pandemic.
For more information, go to https://draperesprit.com/
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END
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