10. Results and key figures
Cashing in a number of strong growth stories at the right moment and active strategic involvement in our businesses enabled us to post attractive earnings during the past financial year of EUR 137 million, with a 20 percent return on our portfolio. We look back on a busy investment year in which we invested in 8 new growth stories, bringing our portfolio to its largest size in more than 10 years: more than 1 billion euros invested in 50 companies.
Strong EUR 137.2 million result
For FY 2015-2016 Gimv posted a net profit (group share) of EUR 137.2 million. This compares with a net profit of EUR 136.0 million in FY 2014-2015. Just over half this result consists of unrealised gains on the portfolio, the balance of the capital gains on the divestments of past year.
Realised net capital gains during FY 2015-2016 amounted to EUR 70.5 million (2014-2015: EUR 102.6 million). 87% of these were realised in the four investment platforms, with EUR 33.1 million coming from the Health & Care plaform, 4.1 million from the Connected Consumer platform, 24.7 million from the Smart Industries platform, and EUR -0.5 million from the Sustainable Cities platform. Additionally, EUR 9.1 million of capital gains were realised as a result of distributions from the third party funds.
Net unrealised capital gains totalled EUR 88.7 million (vs. EUR 45.9 million in FY 2014-2015), coming mainly from Smart Industries (EUR 48.2 million) and Connected Consumer (EUR 11.9 million). The third party funds and other shareholdings also provided a positive result (EUR 32.0 million). Health & Care (-3.4 million EUR), however, made a slightly negative contribution, while the positive and negative fluctuations on the various Sustainable Cities shareholdings balanced each other out (EUR 0.0 million).
The net unrealised capital gains are a direct consequence of the application of the prevailing international private equity valuation rules. These net unrealised capital gains are due primarily to a number of positive elements: (i) expected exits (EUR 72.9 million), (ii) the improved results in the majority of the shareholdings (EUR 61.4 million), (iii) the rise in value of the minority interests in the co-investment funds managed by Gimv (21.1 million), and (iv) an increase in the value of third-party funds (EUR 14.0 million). These positive effects are partly undone by a number of negative elements: (v) lower multiples for unlisted shareholdings (EUR -28.8 million), (vi) an increase in the net financial debt of shareholdings (EUR -21.5 million), (vii) impairments on a number of shareholdings (EUR -20.2 million), (viii) lower stock market prices for a number of shareholdings (EUR -5.3 million), (ix) negative exchange rate effects (EUR -3.6 million) and (x) the initial revaluation of a number of shareholdings (combined effect of EUR -1.2 million).
The other operating result for FY 2015-2016(1) came out at EUR -8.5 million, compared with EUR -4.6 million in FY 2014-2015. On the one hand, other operating income fell by around one tenth (EUR 33.5 million vs. 36.6 million), with a decrease in interest received, management fees received and other operating income not fully offset by dividends received. On the other hand, operating costs (incl. transaction costs) remained stable.
The net financial result for the year is EUR 1.8 million positive, somewhat lower than in the corresponding period of 2014-2015 (EUR 2.7 million). The main explanation is the lower interest received on treasury.
After deducting taxes (EUR -3.8 million) and non-controlling interests (EUR -11.5 million), Gimv realised for the 2015-2016 financial year a net profit (group share) of EUR 137.2 million.
(1) Dividends, interest, management fees, turnover and other operating income, after deducting services and other goods, personnel costs, amortization of intangible fixed assets, depreciation of land, buildings and equipment, and other operating costs.
Active investment year
In FY 2015-2016, Gimv undertook EUR 130.2 million of on-balance sheet investments (versus EUR 154.3 million in FY 2014-2015). An additional EUR 32.3 million were invested via the co-investment funds (as minority interests), bringing the total investments (on balance sheet and via the co-investment funds) to EUR 162.5 million (EUR 191.0 million in FY 2014-2015). The past financial year saw a significant expansion of the Sustainable Cities portfolio with new investments in Brakel, Contraload and Itho Daalderop/Klimaatgarant. There were also initial investments in Benedenti, Biom'Up, Equipe Zorgbedrijven, Legallais and Topas Therapeutics. There were also various follow-on investments in, among others, Ecochem, JenaValve, Mackevision, Melijoe and Thinkstep.
Total direct investments amounted to EUR 122.8 million, of which EUR 105.4 million (81% of the total investments on the balance sheet) of new investments and EUR 17.4 million (13%) of follow-up investments. EUR 7.4 million (6%) of the total amount invested went to third-party funds (indirect investments).
Continuing intense divestment activity
In FY 2015-2016 Gimv sold, among others, its shareholdings in Acertys, BrandAlley, Datacontact, Easyvoyage, Essar Ports, Maes Compressoren, McPhy, Numac, Prosonix, ProxiAD, VCST, Xeikon and XL Video. It also cashed in part of its stakes in Greenyard Foods (private placement) and TINC (over-allotment option), and there were a number of distributions from the third-party funds. For all these divestments Gimv received a total of EUR 227.2 million (332.0 million in 2014-2015).
Additional divestments via the co-investment funds (minority interests) added a further EUR 76.3 million (EUR 35.5 million in 2014-2015), bringing total divestments (on balance sheet and via co-investment funds) to EUR 303.5 million (EUR 367.5 million in 2014-2015).
On top of the exit proceeds of EUR 227.2 million, the sold shareholdings generated in FY 2015-2016 EUR 9.1 million of dividends, interest and management fees. In this way, exits produced a total of EUR 236.3 million. On 31 March 2015 these divestments were carried at a total value of EUR 165.5 million. Consequently, the sales generated 42.7% more (EUR 70.7 million) than their carrying value at 31 March 2015 (measured at fair value in the consolidated figures).
Solid balance sheet structure - portfolio represents 82% of total assets
Total assets amounted at 31 March 2016 to EUR 1 230.3 million. The portfolio amounted to EUR 1 013.9 million compared with EUR 920.2 million at 31 March 2015. Despite the high level of exits, the value of the portfolio rose by 10% as a result of the investments, but also owing to the appreciation of many holdings.
The portfolio breaks down as follows: 28% (EUR 281.5 million) in Connected Consumer, 9% (EUR 93.8 million) in Health & Care, 20% (EUR 208.2 million) in Smart Industries, 15% (EUR 150.1 million) in Sustainable Cities and 7% (EUR 69.5 million) in other participations. An additional 21% (EUR 210.8 million) of the portfolio is in third-party funds.
On 31 March 2016 the unlisted shareholdings made up 91% of the portfolio: 41% of this amount (EUR 416.1 million) is valued on the basis of multiples. The average multiple (EV/EBITDA) for the portion of the portfolio that Gimv values today on the basis of market multiples is 6.7 (after a 26% discount). 14% (EUR 142.3 million) of the portfolio is valued at investment cost, 21% (EUR 210.8 million) based on the net asset value of the underlying third-party funds,11% (EUR 111.4 million) based on other valuation methods (including exit price), 3% (EUR 29.8 million) based on the net asset value of the underlying co-investment funds, and the balance of 1% or EUR 9.2 million based on the price established in the most recent financing rounds. The balance of the portfolio consists of listed shareholdings (4% or EUR 39.4 million) and loans (5% or EUR 54.9 million).
Ample liquidity base allows room for further portfolio expansion
Gimv's net cash position at 31 March 2016 was EUR 183.9 million(1) compared with 184.8 million at 31 March 2015. This stable level, despite significant divestments during the year (227.2 million), is explained by the investments (EUR 130.2 million) in combination with the dividend paid for the previous year (EUR 62.3 million) and the fact that a portion of the divestment proceeds were received in the form of a vendor loan. It should be noted that the divestments of Altaïr/Brunel, GreenPeak and OneDirect were/will be finalized only after the end of the financial year, and are therefore not yet reflected in the net cash position at 31 March 2016. During the coming months we shall continue to work on the approval process for Punch Powertrain.
(1) Cash and cash equivalents of EUR 192.8 million, corrected for advance payments from divestments to be transferred
Equity (after dividend payment) rises to EUR 1 167.9 million or EUR 45.93 per share
Equity (group's share) (= net asset value) amounted at 31 March 2016 to EUR 1 167.9 million (EUR 45.93 per share), compared with EUR 1 092.6 million (EUR 42.97 per share) at 31 March 2015 (both figures prior to dividend payment). The increase in equity during FY 2015-2016, combined with the dividends of EUR 62.3 million paid out during the financial year, represents an economic return on equity for the financial year of 12.6%, which once again is above Gimv's long-term return.
Research and development
Gimv and its consolidated subsidiaries did not undertake any research and development activities during the past year.
|Consolidated financial statements (in EUR 000)|
|Equity||1 167 887||1 092 636||992 043||1 011 829||1 011 260|
|Portfolio||1 013 894||920 189||930 959||814 357||845 217|
|Cash and cash equivalents||192 774||184 766||56 637||195 297||183 391|
|Net cash and cash equivalents||183 881||184 766||56 637||195 297||183 391|
|Balance sheet total||1 230 329||1 136 048||1 026 721||1 072 483||1 055 185|
|Net profit||137 175||135 991||14 998||32 746||-21 920|
|Total gross dividend (1)||62 295||62 295||60 576||58 711||56 781|
|Investments (own balance sheet)||130 220||154 283||194 566||110 806||171 781|
|Investments (including co-investment partnerships)||162 492||190 958||264 768||150 888||279 386|
|Divestments (own balance sheet)||227 168||331 960||95 765||180 686||182 639|
|Divestments (including co-investment partnerships)||303 468||367 431||131 143||254 833||254 939|
|Number of employees||95||103||99||97||99|
|Key figures per share (in EUR)|
|Diluted net profit||5.39||5.35||0.61||1.37||-0.95|
|Gross dividend (1)||2.45||2.45||2.45||2.45||2.45|
|Share price (on the closing date of the financial year)||48.50||41.89||37.12||38.99||38.30|
|Total number of shares||25 426 672||25 426 672||24 724 780||23 963 786||23 176 005|
|Net return on equity||12.6%||13.7%||1.5%||3.2%||-2.1%|
|Gross return on portfolio (2)||20.0%||17.3%||3.8%||5.9%||-0.2%|
|Premium (+) / discount (-) on equity||5.6%||-2.6%||-7.5%||-7.7%||-12.2%|