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Summarised unaudited financial statements for the quarter and six months ended 31 December 2023
UNIVERSAL PARTNERS LIMITED
(Incorporated in the Republic of Mauritius)
(Registration number: 138035 C1/GBL)
SEM share code: UPL.N0000
JSE share code: UPL
ISIN: MU0526N00007
("Universal Partners" or "UPL" or "the Company")
SUMMARISED UNAUDITED FINANCIAL STATEMENTS FOR THE QUARTER AND SIX MONTHS ENDED 31 DECEMBER 2023
Quarter Six months Quarter Six months
ended ended ended ended
31 December 31 December 31 December 31 December Year ended
2023 2023 2022 2022 30 June 2023
Net asset value per share GBP 1.297 1.267 1.429 1.429 1.296
("NAV")*
Profit / (loss) for the GBP 36 291 65 998 (1 637 463) (591 180) (3 062 172)
quarter / period
Earnings / (loss) per share pence 0.05 0.09 (2.25) (0.81) (4.21)
Headline earnings / (loss) pence 0.05 0.09 (2.25) (0.81) (4.21)
per share
* The NAV per share as at 30 June 2023 was £1.296, post payment of the dividend of £0.10 per share in June 2023
Universal Partners has a primary listing on the Official Market of the Stock Exchange of Mauritius Ltd ("SEM") and a secondary
listing on the Alternative Exchange of the JSE Limited ("JSE").
PRINCIPAL ACTIVITY
The principal activity of the Company is to hold investments in high quality, growth businesses across Europe, with a focus on the
United Kingdom ("UK"). The Company's investment mandate also allows up to 20% of total funds at the time an investment is
made to be invested outside the UK and Europe.
BUSINESS REVIEW
Since its listing on the SEM and the JSE, the Company has worked closely with its investment advisor, Argo Investment Managers
("Argo"), to identify potential investments that meet its investment criteria.
The Company has made six investments since listing and successfully concluded two exits.
An update on investments held at the reporting date is presented below.
Portman Dental Care ("Portman")
www.portmandentalcare.com
Portman is one of Europe's largest dental care platforms, with operations in the UK, Ireland, the Nordics, Benelux and France. UPL
became a minority shareholder in Portman following the merger with Dentex in 2023.
It has recently been announced that the merged business will trade under the brand "Portman Dentex", recognising the importance
and value of both individual brands. The integration of the two companies is progressing well, with the new leadership team focusing
on extracting synergies and leveraging economies of scale from the enlarged estate.
Portman Dentex performed ahead of budget for the first quarter of the new financial year and traded ahead of the prior year on a
like-for-like basis. Given the significant increase in borrowing costs over the past year, the business is focusing on driving
operational efficiencies and improving profit margins. While the business is still active in the M&A market, management remain
disciplined with respect to acquisition multiples in light of the higher cost of capital. Portman Dentex acquired three new practices
in the UK during the quarter and now has more than 400 practices in the Portman Dentex Group.
Workwell (formerly JSA Services Limited) ("WW")
www.workwellsolutions.com
WW is one of the fastest-growing contractor accountancy and payroll solutions companies in the UK. Their services are designed
to meet the unique needs of contractors and freelancers, from one-person businesses to large employment agencies. They also create
bespoke solutions for temporary labour supply chains, helping their clients navigate the complexities of contractor payroll and
compliance in the UK and internationally.
Despite general softness in the staffing sector in the UK, WW is trading in line with its budget for the first quarter of its new financial
year. At a net fee income level, the payroll services division is ahead of budget due to a buoyant education sector, offset to some
extent by slower activity in the construction sector. The accounting, international and outsourcing divisions traded marginally behind
budget for the quarter but started the new calendar year with good momentum.
During the period that UPL has been an investor in WW, it has acquired and integrated multiple businesses that have expanded its
international contractor payment capability, especially in Europe. These acquisitions have also diversified the products and services
that WW is able to offer its clients.
In line with its stated strategy, WW continues to evaluate new acquisition opportunities both within the UK and internationally,
specifically in Europe and the USA. While no new acquisitions were concluded during the reporting period, various opportunities
are being considered that may result in a successful acquisition(s) in the coming months. In the meantime, management continue to
focus on integrating prior acquisitions, continuing the roll-out of the WW brand across the business and organic growth initiatives.
SC Lowy Partners ("SC Lowy")
www.sclowy.com
SC Lowy is a leading investment management group focused on credit investing and lending in Asia, Europe and the Middle East.
For the year to December 2023, SC Lowy's credit funds delivered good performances. The flagship Primary Investments fund
delivered a net USD return of 4.9% for the year, with ten of the twelve months achieving a positive result. The two existing Strategic
Investment ("SI") funds continued their good performance, delivering USD IRRs above 14% since their inception dates. During
December 2023, SC Lowy successfully raised a further SI fund focused on opportunities in the Asian market, which is expected to
attract substantial investment before its expected final close in Q1 of 2025.
Solution Bank in Italy experienced a record year, benefitting from elevated net interest margins and growth in its loan portfolio
which compromises a growing proportion of structured loans. Despite turbulent conditions in the South Korean banking sector,
Cheoun Savings Bank produced a good result for the year while deliberately constraining growth in its lending book. With a strong
balance sheet and a high-quality lending book, Cheoun is well placed to benefit from an expected consolidation of the Korean
savings bank sector.
Xcede Group (Formerly Techstream Group) ("Xcede")
www.xcede.com
Xcede is a global recruitment specialist operating across the UK, Europe, North America, Africa and Asia. It operates under two
brands: Xcede and EarthStream. Xcede provides recruitment services in the data, software, cloud infrastructure and cyber security
markets. EarthStream is a global energy recruitment specialist.
Xcede delivered a strong performance during the final quarter of the year, which resulted in the business achieving their revised
profit forecast for 2024. The contracting division performed ahead of plan, while the permanent recruitment division was somewhat
below plan due to difficult market conditions, particularly in the UK.
In December 2023, Xcede was recognised in the British Recruitment Awards, emerging as the winning recruitment agency in the
Technology and Engineering categories. The positive momentum in the business has resulted in a decent start to the new year, with
the new management team driving a vigorous customer-centric strategy to ensure that the business thrives despite tough market
conditions.
To support the growth in the contractor book and to ensure adequate working capital in the business, UPL subscribed for a further
£1.5 million of loan notes issued by Xcede. In addition, the equity of the company was restructured to create a suitable share
incentive scheme for the new management team and certain senior employees.
Propelair
www.propelair.com
Propelair has reinvented the toilet to deliver, through its unique IP and design, one of the most water efficient, economical and
hygienic systems available. The Propelair toilet utilises 1.5 litres of water per flush versus a traditional toilet that uses around
9 litres of water per flush. In addition, its vacuum system significantly reduces pathogen distribution and improves health and hygiene.
As previously reported, progress has been made this year, particularly in relation to the sale of units in the Middle East and South
Africa, where they have traded ahead of budget. However, the company is still significantly behind its original business plan and,
accordingly, we continue to value this investment at a nominal £1.00.
FINANCIAL REVIEW
For the quarter under review, interest income was £1,044,750, comprising of interest from cash balances, loan notes and Portman
Dentex PIK notes. Other income includes an amount of £50,000, earned by the Company as a raising fee for committing to advancing
additional loans to Xcede.
The Company provided for an unrealised fair value loss of £491,858 on the remeasurement of investments at fair value through
profit or loss and an unrealised impairment loss of £187,176. These amounts comprise the adjustments to the valuations in the
Company's underlying investments, as well as the foreign currency translation of SC Lowy, which is denominated in US Dollars.
UPL's rollover investment in Portman Dentex comprises a combination of loan notes and ordinary equity. UPL has decided to
maintain the value of the combined rollover investment during the quarter under review. Given that interest has accrued on the loan
notes, a commensurate reduction of the fair value of the ordinary equity was provided for.
Management fees accrued during the quarter amounted to £467,642 incurred in terms of the investment management agreement
between the Company and Argo. General and administrative expenses amounting to £163,880 were incurred. The accrual for
performance fees is calculated on the revaluation of the Company's investments. These fees, which are recalculated quarterly, only
become payable to Argo if the Company realises the expected profit on disposal of the investments. No performance fees are payable
to Argo until a successful exit of an investment has been achieved. During the quarter under review, there was a net reversal of the
accrual for performance fees previously recognised, which had a positive impact on the income statement of £260,904.
CHANGES TO THE BOARD OF DIRECTORS
The Mauritius Companies Act 2001 was recently amended to provide that, as from 1 January 2024, the board of directors of a listed
company must be comprised of at least 25 percent women. To comply with this amendment, the following changes have been made
to the composition of the board:
- Mr Larry Nestadt has resigned as a non-executive director and Chairman of the Board and has been succeeded as Chairman
by Mr Marc Ooms, who has been a non-executive director of the Company since its formation.
- Mr Kesaven Moothoosamy has resigned as a non-executive director and has been replaced by Ms Toorisha Nakey Kurnauth.
- Mr Andrew Dunn has resigned as non-executive director.
The above changes will take effect on 13 February 2024 and ensure that the Company is fully compliant with the amended
legislation.
We thank Messrs Nestadt, Dunn and Moothoosamy for their contributions and their service as non-executive directors of the
Company since its formation and wish them well. At the same time, we extend a warm welcome to Ms Nakey Kurnauth and look
forward to her contribution.
Short-form announcement
This short-form announcement is the responsibility of the directors and is only a summary of the information in the full
announcement and accordingly does not contain full or complete details. The full announcement was published on SENS on
14 February 2024, and can be found on the Company's website www.universalpartners.mu and can be accessed using the following
JSE cloudlink https://senspdf.jse.co.za/documents/2024/jse/isse/UPLE/Q224Result.pdf.
Any investment decisions by shareholders and/or investors should be based on the full announcement released on SENS and
published on the Company's website.
Copies of this report are available to the public, free of charge, at the registered office of the Company, c/o Intercontinental Trust
Limited, Level 3 Alexander House, 35 Cybercity, Ebene 72201, Mauritius.
Copies of the statement of direct or indirect interest of the Senior Officers of the Company pursuant to rule 8(2)(m) of the Securities
(Disclosure of Obligations of Reporting Issuers) Rules 2007 are available to the public upon request to the Company Secretary at
the registered office of the Company at c/o Intercontinental Trust Limited, Level 3 Alexander House, 35 Cybercity, Ebene 72201,
Mauritius. The Board of Universal Partners accepts full responsibility for the accuracy of the information in this communique.
In line with the Company's investment strategy to achieve long-term growth in NAV, dividends are not declared on a regular basis.
Accordingly, no dividend has been declared for the quarter under review.
The Board of Universal Partners accepts full responsibility for the accuracy of the information contained in this announcement.
By order of the Board
Mauritius – 14 February 2024
Company Secretary
Intercontinental Trust Limited
For further information please contact:
SEM authorised representative
JSE sponsor and sponsor Company Secretary
Java Capital Perigeum Capital Intercontinental Trust Ltd
Tel: +27 11 722 3050 Tel: +230 402 0890 Tel: +230 403 0800
Date: 14-02-2024 08:00:00
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