Augmentum Fintech plc
COVID 19: POTENTIAL IMPACT AND PORTFOLIO PROGRESS
Augmentum Fintech plc (LSE: AUGM) (“Augmentum” or the “Firm”), the UK’s solely publicly listed fintech enterprise capital fund, at the moment supplies an replace on the present affect of Covid-19 on the enterprise and the measures the Group is taking to handle the fund within the present setting.
The funding administration group’s enterprise continuity plan has been activated and the group is working remotely. We now have tailored easily to the brand new working preparations.
The funding supervisor is taking proactive measures to offer our portfolio corporations and administration with the help they want and imagine that many are properly positioned to profit throughout these difficult occasions. This elevated dialogue with the portfolio corporations will proceed and our funding supervisor will proceed to offer help so long as needed.
The Firm has a robust, diversified portfolio of eighteen personal fintech corporations a lot of whom are class leaders throughout a large number of verticals. Every of those corporations is constructed upon revolutionary, best-in-class applied sciences and is overhead-light, with lean and environment friendly operations. These corporations are agile, in a position to reply to altering market situations, well-versed in distant working, and consequently have lowered operational danger in comparison with many different bigger corporations.
Though the state of affairs continues to be fluid and firms inside the portfolio are anticipated to expertise short-term impacts to their enterprise, as a result of Firm’s diversification throughout the broader fintech spectrum the funding supervisor expects a number of of the businesses within the portfolio to carry out counter-cyclically.
Certainly quite a few these corporations are already experiencing heightened demand for his or her services, they characterize a significant proportion (40%+) of our NAV, and are rising far faster than in regular situations by means of serving to their buyer base on this time of want with their services.
The desk under units out the Firm’s NAV breakdown as of Sep 30th, 2019 adjusted for any investments since that date at value.
Receipt Financial institution
The Board and the funding supervisor recognise that we’re within the midst of an ever-changing state of affairs, this replace supplies a quick abstract of the present standing of among the key holdings within the portfolio the place we’ve some early indicators of current efficiency. The Firm doesn’t carry any debt on its stability sheet and has a present money place of roughly £14m to permit for future supportive funding within the portfolio alongside a robust syndicate of co-investors.
Interactive Investor (represents 11.4% of the portfolio)
ii continues to see sturdy buying and selling volumes in Q1 and that has not diminished prior to now two weeks. As a digital, scaled, flat payment platform, ii has a extremely resilient enterprise and working mannequin which isn’t excessively reliant on treasury revenues. ii has switched to distant working and is concentrated on persevering with to offer the very best service to its clients whereas making certain the welfare of the ii group.
Zopa (represents 9.0% of portfolio)
At Zopa, the speed of return for buyers on the platform has traditionally proven little volatility relative to the general public markets. Particular person investments are unfold throughout a number of debtors which, along with world class underwriting and robust tech functionality, is how they’ve been in a position to provide constructive returns for the final 15 years by means of each downturns and upturns.
Zopa continually displays exterior components for any affect on their clients’ skill to repay their loans. In current months, Zopa has already been by means of two rounds of focused tightening on who they lend to and has responded shortly to the altering state of affairs with additional measures to cut back credit score danger that are anticipated to end in decrease lending volumes whereas the state of affairs persists.
With £5bn+ lent in private loans since inception, £1bn in 2019 alone, Zopa’s P2P enterprise has been worthwhile since 2016 and it’s leveraging its sturdy expertise, know-how and folks to adapt shortly and make any modifications essential to navigate by means of the present state of affairs.
BullionVault (represents 7.6% of portfolio)
In unsure occasions comparable to these, gold comes into its personal. BullionVault presents clients direct, digital entry to bodily bullion and has seen buying and selling volumes enhance 387% during the last week from the earlier 52-week common to whole £14.3m per day throughout gold, silver and platinum.
iwoca (represents 5.9% of portfolio)
iwoca’s mission of offering quick, honest and versatile enterprise funding is as essential as ever. Having so far made £1bn in funds obtainable to over 50,000 companies throughout the nation, iwoca is the main supplier of a lot wanted working capital to small companies. The corporate has a robust stability sheet and is properly ready to climate the challenges forward. However, it’s anticipated that iwoca will scale back their typical lending ranges as they assess the affect of Covid-19 on the broader UK and German markets.
iwoca can be participating with Governments in each Germany and the UK to supply their help. They’re in talks with HM Treasury in regard to the £330bn help bundle for SMEs. They’re emphasising the significance of working with revolutionary and nimble fintechs alongside the standard banks, as it’s important a part of the answer to make sure the Authorities can swiftly meet their dedication on delivering the help UK SMEs require.
Grover (represents 3.9% of portfolio)
With huge swathes of individuals working remotely now, the necessity for appropriate know-how has provided a B2B alternative for this enterprise. Grover presents an inexpensive know-how rental resolution for enterprise clients and has discovered a candy spot with corporations considerably growing their IT sources for distant working. The corporate has seen a surge in demand from each B2B and B2C on-line channels as individuals and firms equip themselves for residence working and self-isolation. The corporate grew its subscriptions 12% month-on-month to finish of February, and this development has continued into March. Consequently, year-on-year income comparisons proceed at 2.9x with the corporate properly positioned to proceed to carry out strongly regardless of the uniquely adversarial market situations.
Onfido (represents 6.5% of portfolio)
Having seen 2.3x income development yr on yr, id verification and biometrics firm Onfido continues to broaden their buyer focus past Monetary Providers. Conventional public providers comparable to GPs are below elevated strain, and bodily appointments with a GP are actually discouraged. Onfido is working with the likes of on-line physician Babylon to help their efforts in serving elevated affected person numbers.
Farewill (represents 3.1% of portfolio)
Greater than ever persons are involved about caring for his or her family members and targeted on making certain the suitable monetary preparations are in place. Whereas the standard will-writing course of is lengthy, arduous and in-person, Farewill presents a nimble, inexpensive providing with excellent customer support, which will be accomplished on-line 24 hours a day, seven days per week. The corporate is buying and selling 10x when it comes to revenues versus the identical interval final yr and has seen 100% quarter on quarter development.
Augmentum’s share worth like a lot of its friends has seen important motion in current weeks, and it’s now buying and selling at a considerable low cost to the final revealed NAV. In mild of this the Firm has taken the chance to purchase again some shares to the advantage of all shareholders.
The Board and the funding supervisor imagine firmly that the Firm has a diversified, balanced and sturdy portfolio which is well-positioned to climate the present market stresses and doubtlessly even profit from extra alternatives created by these market situations over the medium time period.
Tim Levene, Portfolio Supervisor
Nigel Szembel, Investor Relations
+44 (0)20 3961 5420
+44 (0)7802 362 088 / [email protected]
Liz Yong / Luke Simpson
|+44 (0)20 7418 8900|
Harry Gooden / James Moat
|+44 (0)20 7496 3000|
Victoria Hale, Firm Secretary
+44 (0)20 3170 8732
About Augmentum Fintech plc
Augmentum invests in quick rising fintech companies which can be disrupting the monetary providers sector. Augmentum is the UK’s solely publicly listed funding firm specializing in the fintech sector within the UK and wider Europe, having launched on the principle market of the London Inventory Change in 2018, giving companies entry to affected person capital and help, unrestricted by typical fund timelines and giving public markets buyers entry to a largely privately held funding sector throughout its foremost interval of development.