Shares in private equity and venture capital firm Oakley Capital Investments (OCI) jumped over 7% to 408.5p following the announcement of a better than anticipated year-end trading update.
Net asset value increased by 21% in the second half of 2021, whilst the full year the return was 35%.
During the year, 76% of the increase in the portfolio’s value was driven by EBITDA (earnings before interest, taxes, depreciation, and amortisation) growth, and 24% by multiple expansion including disposals.
DISPOSLAS HIGHLIGHT CONSERVATIVE VALUATION
A key contributor to Oakley Capital’s net asset value growth during the first half was the disposal of the information services platform TechInsights, at a 125% premium to the June book value.
This deal added 19p per share, equivalent to 4.3% of net asset value. Oakley has benefited from material uplifts at exit in recent years with Liberum estimating an average increase since the start of 2018 of 60%.
Oakley Capital shares have fallen by 9% year to date, and currently trade on a 29.2% discount to the December 2021 net asset value.
According to Jefferies analyst Matthew Hose who has a buy rating with a 480p price target ‘this is a blockbuster NAV from OCI, reassuringly driven by the portfolio’s very strong EBITDA growth’.
