Resilience through strong portfolio and robust balance sheet

20/05/2020 - 07:00 | Financial

CEO Koen Dejonckheere:

The current very exceptional crisis requires proactive and responsible ownership. The economic reality and the way our companies operate will be different once Covid-19 is behind us. Hand in hand with entrepreneurs who demonstrate resilience and adaptability and can think ahead in hugely changed circumstances, we need to come up with appropriate responses. With a whole range of initiatives, our companies are already demonstrating great adaptability.

Up to early weeks of 2020, our companies posted strong performances. However the sharp stock market decline in March 2020 and the ensuing write-down of our portfolio translate into a negative (unrealized) portfolio result for the full financial year. We observe that our businesses are affected to very diverging degrees by the crisis, with a significant part of our portfolio proving resistant. However, it is still too early to get a clear picture of the impact on the results of our companies, both for the present and the coming financial years.

Our management teams took the right actions to control the short-term impact as well as possible, and we are currently working with them to ensure optimal restarts and to absorb the impact of the crisis as smoothly as possible. Our teams stand close to our companies to assist and strengthen them where necessary.

Each crisis provides new insights, with certain trends disappearing, changing or accelerating. Where we see new trends and ideas, we see new business plans. With our experienced teams, solid balance sheet and strong liquidity, Gimv is ready and able to continue to support agile entrepreneurs, scientists and innovators who adapt and seize opportunities in changing circumstances.

Chairman Hilde Laga adds:

Our 40 years’ experience combined with our flexibility and strong financial position give us confidence for the future. This confidence is reflected in a proposal to confirm the EUR 2.50 dividend in line with Gimv's dividend policy. Payment of the dividend with the option to receive new shares should enable us to secure additional financing for our portfolio and the economic recovery.

We would like to thank all employees at Gimv and our companies and all stakeholders, who, even in these very challenging times, continue working more than ever to ensure the continuity of our activities and the further success of our investments.

For more information on the annual results, watch the video

The results for the 2019-2020 financial year cover the period from 1 April 2019 to 31 March 2020.

Key elements

Results

  • Confirmation of strong growth in our portfolio companies in 2019: 12% sales growth & 9% EBITDA growth
  • The major stock market correction in March 2020 due to the Covid-19 crisis had a direct negative impact on valuation multiples, leading to a significant unrealized write-down of our portfolio.
  • Portfolio result: EUR -112.0 million
  • Portfolio return: -10.3%
  • Net result (group’s share) EUR -151.6 million (EUR -5.96 per share)

Investments / Divestments

  • Total investments: for the third year in a row above our annual target of EUR 200 million. In FY 2019-20, we invested EUR 205 million in 6 new portfolio companies and in significant add-on investments*
  • Total cash proceeds from divestments: EUR 179.4 million
  • Realized money multiple of 2x on divestments

Balance sheet and portfolio

  • Despite significant write-down, the total investment portfolio remains above EUR 1 billion (EUR 1 017 million)
  • Young and promising portfolio of 53 portfolio companies, with 80%+ of the portfolio invested in the last 4 years
  • Balance sheet total: EUR 1.4 billion
  • Cash position: EUR 368 million (of which EUR 250 million from the LT bond issue in June 2019)

Equity

  • Equity value (group’s share): EUR 1 104.9 million (EUR 43.5 per share)

Dividend

  • Dividend stable for FY 2019-2020 financial year, in line with Gimv's dividend policy: EUR 2.50 gross (EUR 1.75 net) per share (subject to approval by the General Meeting of 24 June 2020)
  • Payment in cash or as stock dividend, enabling Gimv to strengthen its cash position for supporting its portfolio and undertaking new investment opportunities

* Excl. the investment in Coolworld Rentals, concluded in early April 2019 and already reported as an investment in FY 2018-2019, but included in the portfolio only in FY 2019-2020.

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