Highlights:
· Total Shareholder return of 10.1% for the year including the dividend paid in July 2020
· Net Asset Value (“NAV”) increased by £13.0m to £149.9m (31 January 2020: £136.9m), a 9.5% increase net of dividend paid in July 2020
· Net Asset Value per share increased by 36.3p to 416.4p (31 January 2020: 380.1p)
· Consolidated profit after tax of £13.7m (31 January 2020: £12.5m)
· One new investment; Sage Program Underwriters Inc. in Bend, Oregon, United States
· Proposed dividend of 2.44p per share payable in July 2021 (2020: 2.22p)
Analyst and investor briefing:
An analyst presentation, hosted by the Company, will be held on Tuesday 8 June 2021 at 10:00 a.m. BST.
Please contact Tim Pearson at Tavistock Communications on 07983118502 or tim.pearson@tavistock.co.uk should any analyst wish to attend or instead register using the link below.
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Registration link: |
https://www.speakservecloud.com/register-for-call/53238cb2-b9e4-42e8-a883-7314b3346842 |
Note
This announcement contains inside information for the purposes of Article 7 of Regulation (EU) No 596/2014.
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Forfurtherinformation,pleasevisitwww.bpmarsh.co.ukorcontact: |
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B.P.Marsh&PartnersPlc BrianMarsh OBE/AliceFoulk |
+44(0)207233 3112 |
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PanmureGordon(UK)Limited AthollTweedie/CharlesLeighPemberton/AilsaMacMaster |
+44(0)2078862500 |
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Tavistock SimonHudson/ Tim Pearson |
+44(0)207920 3150 |
Notes to Editors:
B.P. Marsh's current portfolio contains eighteen companies. More detailed descriptions of the portfolio can be found at www.bpmarsh.co.uk .
Since formation over 30 years ago, the Company has assembled a management team with considerable experience both in the financial services sector and in managing private equity investments. Many of the directors have worked with each other in previous roles, and all have worked with each other for approaching ten years.
Statement by the Chairman and Managing Director
We are pleased to present the audited Consolidated Financial Statements of B.P. Marsh & Partners Plc for the year ended 31 January 2021.
Results
For the year under review, the Group has achieved a 9.5% increase in Net Asset Value (net of dividend) and an increase in the equity value of the Portfolio of £12.9m to £131.0m. In addition to our loan book of £17.1m (2020: £18.8m), we are pleased therefore to be able to report that our Net Asset Value stood at £149.9m or 416.4p per share, as at 31 January 2021.
As at 31 January 2021, the Company had available cash of £2.7m, comprised of a free cash balance of £0.7m together with access to a further £2.0m by way of a loan facility with Brian Marsh Enterprises Limited. Net of the dividend payable in July 2021 and other commitments, current available cash, including the loan facility, is £2.5m.
For the year ended 31 January 2021, the Board are recommending a distribution of 2.44p per share to Shareholders (prior year 2.22p). It remains important to the Group to reward its loyal Shareholders with dividends when circumstances allow, and this year the Board is pleased that it is able to increase the distribution by 10% above that of the previous financial year. Like many other companies at this time, the Board has decided that it is prudent to limit its borrowings and conserve cash within the business, with this approach being kept under continuous review.
As Shareholders will understand, the year under review, ending 31 January 2021, was dominated by the Coronavirus Pandemic which struck all the territories in which we operate.
We and our Investee Companies faced rapid and total change in all our working environments. Management and Staff rose to the occasion and, as can be seen, have succeeded in delivering the Group's objectives.
Not only is this a testament to our hardworking team who have all demonstrated the flexibility and commitment required to see the Group through this difficult time, but we feel it also lies in our simple business model of investing in good quality businesses. These are themselves led by entrepreneurial and committed management teams. Additionally, we have deliberately created a diverse portfolio, and one which has so far been able to weather this particular storm.
In light of this, we were particularly pleased to have been able to complete a 30% investment in Sage Program Underwriters Inc. (“Sage”) in June 2020, partnering with Sage's Founder and Chief Executive Officer, Chuck Holdren. Sage is a provider of specialist niche insurance products based in Oregon in the United States.
This addition to the portfolio adds to the Group's existing list of North American investments, and we are confident that this will be a successful partnership.
Covid-19
As has been reported previously, all members of staff adapted to remote working on 9 March 2020 and this has been achieved both swiftly and with few obstacles. Our current view is that this will continue for the time being with periodic access to the office being granted to those who require it. Any change in policy will be done in line with Government advice at the time.
Within the Portfolio, Covid-19's impact has been variable. Some of our investments witnessed improved performance whilst others experienced challenges. Throughout the Pandemic, our Investment Department have been on hand to assist and support the Management Teams within the Portfolio. We are confident that the set of Results which we have released today demonstrates that, even faced with serious adverse conditions, our diverse portfolio is still able to deliver a solid performance.
The Portfolio
As noted above, it is the belief of the Group that our portfolio has shown commendable resilience on the whole, and there are a number of highlights within the portfolio as well as updates to bring to our Shareholders' attention. Further updates on the portfolio are provided in the Chief Investment Officer's report.
Nexus Underwriting Management Limited (“Nexus”) remains the Group's largest investment, and its growth continues to date. As announced previously, in December 2020 Nexus acquired the Hiscox MGA Marine business. Nexus had Gross Written Premiums for its 2020 Financial Year of £308m.
XPT Group LLC (“XPT”), headquartered in New York, has experienced commendable performance in difficult circumstances and is aiming to produce Gross Written Premiums of US$400m for its 2021 financial year. During the year, XPT acquired two new businesses, taking the total to eight acquisitions in its four years of trading. Additionally, XPT launched a new trucking programme via its subsidiary, W.E. Love & Associates.
As announced previously, the Group's Canadian Investment, Stewart Specialty Risks Underwriting Limited (“SSRU”) has experienced significant growth since the Group invested in it as a start-up, in January 2017. Since it was established it has grown Gross Written Premiums to CA$33m (£19m) in 2020, with a budget to increase this to CA$55m (£31m) for its 2021 Financial Year.
In September 2020, the Group provided additional funding of £1.5m to EC3 Brokers Group Limited (“EC3”) by way of subscription of further Preference Shares, taking its shareholding to 35%. EC3 has faced a challenging year with Covid-19, felt most by its Event Cancellation business.
In troubled times it is more than usually difficult to predict future results, but every effort will be made to maintain our growth objectives.
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Brian MarshOBE |
AliceFoulk |
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Chairman |
ManagingDirector |
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7June 2021 |
7June 2021 |
Chief Investment Officer Statement
At the outset of Covid-19, the Group believed that its portfolio was well positioned to cope with the unprecedented times it was facing.
Whilst no one imagined the longevity of the pandemic, the statement above has held true with our portfolio showing consistent growth over our financial year to 31 January 2021, with the equity valuation of the portfolio increasing in value by £12.9m to £131.0m, or by 10.9%, adjusting for new equity investment.
The Group's mantra of investing in a diverse portfolio across the insurance sector, both in the lines of business written and the geographic location, has been a key component of the portfolio's resilience throughout this time.
During the pandemic, our emphasis has been on our existing portfolio, ensuring stability during an ever- changing environment. As we begin to see a return to partial normality and as the vaccination programs in the UK and worldwide gain momentum, this focus is now shifting towards assisting the portfolio to take advantage of any new opportunities that may transpire as the world's economy recovers from the pandemic.
The financial year closed with a total of 50 new Investment opportunities having been presented to the Group during the year, in comparison with 117 in the previous year. Since the year end, there has been an increase in new Investment opportunities received, giving us plenty to consider. We remain optimistic that we will be able to secure scalable and high growth investments, which will deliver substantial shareholder returns over time.