Profitable trading achieved ahead of plan driven by AuM growth
We have strengthened our balance sheet, grown our assets under management, taken the Group to net revenues and readied the business to take full advantage of the opportunities that will emerge.
Times such as these can be challenging and difficult, but they can also be defining moments. I am proud to be part of #OneMercia.Ian Metcalfe, Non-executive Chair – Mercia
Edison Group research report
Scaling, sustainable and evergreen by FY22
“Mercia’s management have set out a clear vision for the company, with the acquisition of NVM’s VCT business accelerating Mercia’s transition towards becoming a regionally focused specialist asset manager, managing fee-paying third-party funds and reducing its reliance on its own balance sheet. After a difficult 2019, investors have been seeing real value in the widened discounts to NAV in the sector as COVID-19 fears abate.”
To view the full research report visit edisongroup.com
We are on a rewarding journey, together
As we emerge from the current challenging environment, we are well placed with preserved capability and liquidity to sustain our highly selective investment strategy and the flexibility to continue to support and manage our portfolios as companies mature.
Assets under management (“AuM”)
c.£800m
2019: c.£507m
Funds under management (“FuM”)
c.£658m
2019: c.£381m
Portfolio developments
- £17.5million gross invested into 18 portfolio
companies during the year including one new direct investment, One Touch Apps, t/a Clear Review - Net fair value decrease of £15.8million – near-term
COVID-19 impact (2019: £3.9million increase) - Direct investment portfolio decreased to
£87.5million (2019: £87.7million) - 12 portfolio companies received new investment
from external investment partners - Notwithstanding COVID-19 impact, continuing underlying commercial progress made by a number of portfolio companies including nDreams, which continues to be the Group’s largest direct investment
Operational highlights
- Third-party FuM increased to c.£658million (2019:
c.£381million) contributing £11.7million in revenue - FuM increase largely reflects the acquisition of
NVM VCT fund management business that added
c.£250million in managed funds - Venture FuM c.£476million (2019: c.£224million)
- Private equity FuM c.£60million (2019: c.£61million)
- Debt FuM c.£122million (2019: c.£96million)
Net assets
£141.5m
2019: £126.1m
Unrestricted cash
£30.2m
2019: £29.8m
Revenue
£12.7m
2019: £10.7m
Direct investment portfolio
£87.5m
2019: £87.7m
Net revenues
£0.1m
2019: £1.4m net expenses
Complete Connected Capital
Mercia’s investments across its four asset classes are powering ambitious regional SMEs with the capital that they need to grow. Our business model is designed specifically to support the funding needs of companies through their journey from origin to exit.
Balance sheet
Up to £10m
Total portfolio: 25
Total invested in 2020: £17.5m
Liquidity: £30.2m
Venture
£100k–£10m
Total portfolio: 233
Total invested in 2020: £34.4m
FuM: £475.6m
Private equity
Up to £10m
Total portfolio: 10
Total invested in 2020: £10.7m
FuM: £59.8m
Debt
£100k–£10m
Total portfolio: 119
Total loans in 2020: £14.5m
FuM: £121.8m
Annual Report 2020
The Group is now trading profitably as a result of its fund management activities, providing further positive momentum for the Group’s future prospects.
Martin Glanfield, Chief Financial Officer – Mercia
