ICG Enterprise Trust H1 2025 slides: Mixed performance with strong cash generation

ICG Enterprise Trust PLC (LSE:ICGT) presented its H1 2025 results on October 7, 2025, revealing a mixed performance characterized by negative NAV returns but strong cash generation and robust portfolio company earnings growth. The trust, which specializes in private equity investments, reported a slight decline in NAV per share total return of 0.7% for the six months ending July 31, 2025, while maintaining its focus on resilient companies in developed markets.

Performance Highlights

ICG Enterprise Trust reported a NAV per share total return of -0.7% for H1 2025, comprised of a -2.6% return in Q1 followed by a recovery to 1.9% in Q2. Despite the short-term challenges, the trust’s long-term performance remains strong with 5-year annualized NAV returns of 14.5% and 10-year annualized returns of 13.3%, significantly outperforming the FTSE All-Share index.

As shown in the following chart of long-term performance metrics:

Portfolio companies demonstrated resilience with impressive double-digit growth metrics, including LTM revenue growth of 10.2% and LTM EBITDA growth of 15.2%. Valuation multiples remained stable with EV/EBITDA at 15.3x, while leverage increased slightly to 4.7x Net Debt/EBITDA from 4.4x at the end of FY25.

The following image highlights these strong operational metrics:

Oliver Gardey, Portfolio Manager at ICG Enterprise Trust, emphasized the strength of the underlying portfolio: "Our portfolio companies continue to report double-digit earnings growth, demonstrating the resilience of our investment approach. Additionally, we’ve seen strong cash generation during H1, with total proceeds of £222 million."

Investment Strategy and Portfolio Positioning

ICG Enterprise Trust maintains a focused investment strategy targeting resilient companies through a multi-stage selection process. The trust concentrates on buyouts in developed markets, primarily North America and Europe, with a preference for mid-market and larger deals executed by top-tier managers.

The trust’s portfolio maintains a balanced exposure across investment categories and geographies:

During H1 2025, ICG Enterprise Trust committed £108 million to new investments, deployed £113 million, and generated £222 million in proceeds, demonstrating the active management of its portfolio. The trust increased its exposure to secondaries, which now represent 33% of the portfolio, up 2% since January.

The following image illustrates the investment strategy execution:

New commitments were primarily directed to established managers with strong track records in both North America and Europe:

Colm Walsh, Portfolio Manager, commented: "We remain selective in our approach, focusing on opportunities where we see strong potential for value creation. Our flexible investment approach allows us to capitalize on attractive opportunities in secondaries and direct co-investments."

Cash Generation and Shareholder Returns

A standout aspect of the H1 2025 results was the strong cash generation, with total proceeds of £222 million representing 15% of the opening portfolio (30% annualized). This significantly exceeded the realization activity of the previous year’s comparable period (H1 FY25:£86 million).

The following chart illustrates the realization activity:

Notable exits included MINIMAX (£49 million), Datasite (£23 million), and European Camping Group (£19 million). These realizations continued the trust’s long track record of achieving uplifts on exit, though the most recent uplifts of 15% were lower than the historical average.

The strong cash generation supported ICG Enterprise Trust’s shareholder distribution strategy, which combines a progressive dividend policy with share buybacks. The trust has executed £67 million in share buybacks, representing 8% of opening shares, which contributed to a 65p (3.3%) NAV per share accretion.

The dividend for FY26 is set at 38p per share, a 6% increase from the previous year, continuing the trust’s track record of dividend growth since 2017:

Balance Sheet and Outlook

ICG Enterprise Trust maintains a robust balance sheet with total available liquidity of £187 million, a low gearing ratio of 5%, and a low overcommitment ratio of 31%, providing flexibility for future investments.

Looking ahead, management expressed confidence in the trust’s positioning, citing visibility of further exits, a robust balance sheet, and an attractive investment pipeline. The focus remains on maintaining a balanced portfolio of resilient companies across sectors and geographies.

"We are well-positioned with our robust balance sheet and strategic sector and geographical positioning," noted Oliver Gardey. "The portfolio continues to generate liquidity, and we see attractive opportunities in secondaries and direct co-investments."

ICG Enterprise Trust’s shares closed at £1,510 on October 6, 2025, representing a 0.8% increase. The stock has traded between £1,064 and £1,514 over the past 52 weeks, reflecting the market’s mixed sentiment toward private equity investments in the current economic environment.

The trust’s strategic focus on resilient companies, combined with its disciplined investment approach and strong cash generation, positions it well to navigate the ongoing market challenges while continuing to deliver long-term value to shareholders.

Full presentation:

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