6% TSR and significant buybacks

Well positioned to act with 29% net cash

23% NAV discount vs. historical average of 15%

Total shareholder returns of 6%
NAVPS as of 30 June was SEK 62.20, implying a 2.4% decrease q-o-q. The NAV decline was largely driven by the dividend payout (DPS of SEK 2.78 and a dividend yield of 5.8%) and the share buybacks, which amounted to 6% of the outstanding shares. Meanwhile, the stock was up 5.7% in total-return terms in the quarter, only marginally underperforming the SIXRX (+6.6%). The NAV discount narrowed by 2pp to 22%. With regard to the direct investments, Awilco Drilling and Scout Gaming Group posted TSRs of -16% and -19%, respectively. Private equity fund investments currently stand at 63% of NAV (66% including commitments), direct investments at approximately 8%, and net cash at 29%.

High activity in underlying funds
Apart from the dividend and the share buybacks, NAXS did not carry out any investment activities in the quarter. However, activity in the underlying funds was high, as three new acquisitions were made and four complete exits carried out. Notable activity included JAB Consumer Fund – GCG II’s acquisition of National Veterinary Associates, Mimir Invest’s purchase from Epiroc, and Apax VII’s divestment of Acelity.

Valuation well below historical average
NAXS currently offers exposure to eleven funds from eight different managers and three direct investments. The NAV discount has widened by 13pp over the last three years, and presently stands at 23%, which compares to the historical average (2010-) of 15%. We expect the share buybacks to resume, and the dividend yield is likely to stay above 5% based on today’s valuation. Moreover, we believe that a further lowering of the substantial cash position would act a catalyst for reducing the NAV discount, and we consider continued buybacks in combination with new investments an adequate deployment of capital.

info@introduce.se (Introduce.se)

ABG Sundal Collier - Introduce.se