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(Sharecast News) - HgCapital Trust reported a resilient first-half trading performance on Monday, despite headwinds from market volatility and currency movements, with strong growth across its portfolio companies and continued deal activity.
In a preliminary update for the six months ended 30 June, the private equity investment trust reported an estimated net asset value (NAV) per share of 540.2p, equivalent to total net assets of 2.5bn.
Net asset value total return was marginally negative at -0.3%, as a 1.7% gain in the second quarter offset a 2.0% decline in the first.
HgCapital Trust's underlying portfolio companies delivered strong operational performance, with trailing 12-month revenue and EBITDA growth of 19% to the end of May.
That contributed a 7% uplift in portfolio value.
However, the impact of falling valuation multiples amid wider public market volatility detracted 4% from net asset value, while adverse currency movements and increased net debt reduced it by a further 2%.
Investment activity remained robust, with 306m deployed during the period, including new and follow-on investments in IFS, P&I, Citation and Scopevisio.
Co-investments, which are exempt from management fees and carried interest, accounted for 34m and now represented 10% of net asset value.
Realisations generated 165m, including exits from P&I, Citation, Trackunit and smartTrade.
A further 49m had been committed since the period ended, including a new investment in compliance specialist A-LIGN, expected to close in August.
HgCapital Trust also made a $1bn commitment to Hg's Saturn 4 fund during the first half.
On a pro-forma basis, including recent foreign exchange movements and additional fund commitments, the trust's available liquid resources stood at 383m, while outstanding commitments to Hg funds totalled 1.7bn, expected to be drawn over the next four to five years.
The trust highlighted encouraging prospects for the second half of the year, citing improved deal activity across Hg's portfolio.
In total, Hg said it had deployed $4.5bn across its funds year-to-date, while realisations exceeded $2bn.
The manager noted that compared favourably to industry peers amid what it described as a "challenging" liquidity environment.
HgCapital Trust said it would publish its full interim results on 15 September.
At 1004 BST, shares in HgCapital Trust were up 0.2% at 512p.
Reporting by Josh White for Sharecast.com.