B.P. Marsh & Partners Plc
(“B.P. Marsh”, the “Company” or the “Group”)
Trading Update
Chairman's Update
Introduction
B.P. Marsh, the niche venture capital provider to early stage financial services businesses, is pleased to provide the market with an update on trading for the Group's year ended 31 January 2022.
Update
We have had a positive year to 31 January 2022. This began with the early repayment of loans from Stewart Specialty Risk Underwriting Ltd in Canada, and from Nexus Underwriting Management Limited and CBC UK Limited, both headquartered in London.
However, we are particularly pleased with the number of disposals which have been completed in the second half of the year. We have realised our holdings in MB Prestige Holdings PTY Limited in Australia, Mark Edward Partners LLC in the USA and Walsingham Motor Insurance Limited in London. We are also in the final stage of the proposed sale of our majority stake in Summa Insurance Brokerage S.L. (“Summa”) in Spain. More information about each disposal can be found below in the Chief Investment Officer's report.
We continue to keep a close eye on the developments regarding Coronavirus but we are encouraged by the recent relaxation of restrictions in the United Kingdom and the fact that business appears to be 'returning to normal'. In line with this, the Company is beginning to return to the office on a more regular basis, adopting a hybrid approach where appropriate.
We are looking forward to 2022 and believe the Company is well positioned to take advantage of opportunities as they arise.
Net Asset Value
One of the Group's key financial objectives is the delivery of long-term growth in Net Asset Value. The Group's interim results to 31 July 2021 showed an increase in Net Asset Value to £155.0m (31 July 2020: £142.6m; 31 January 2021: £149.9m), producing a 4.0% return to shareholders (including the payment of a dividend) in the six month period. The Group remains positive regarding its ongoing performance.
We remain focussed on taking actions to reduce the differential between Net Asset Value per share and the current share price.
Cash Balance and Loan Facility
Group cash has increased by £8.5m overall since the Interim Results to 31 July 2021 to £8.6m as at 31 January 2022. This increase was mainly due to receiving £5.0m from the sale of Walsingham Motor Insurance Ltd including the repayment of our £0.3m loan from Walsingham Holdings Ltd, plus £2.0m from the repayment of loans from CBC UK Ltd and £1.1m from the disposal of the Group's interest in Mark Edwards Partners LLC. This enabled the Group by November 2021 to repay the £1.0m drawn down from its £3.0m loan facility with Brian Marsh Enterprises Ltd, a company of which I am a director and sole shareholder.
In addition, we are expecting to receive a further £9.6m in cash from the sale of our investment in Summa and the repayment of outstanding loans to that company.
The £3.0m loan facility with Brian Marsh Enterprises Ltd expired on 29 January 2022 and the Group is now debt free with significant cash resources to fund future investments.
Dividend
The Board has recommended a dividend of 2.78p per share (£1.0m) for the financial year ending 31 January 2022 to be paid in July 2022, subject to Shareholder Approval at the Company's Annual General Meeting.
This represents an increase of 13.9% over the dividend of 2.44p per share (£0.9m) paid in respect of the prior year.
It is the Board's aspiration to maintain a dividend of at least 2.78p per share for the years ending 31 January 2023 and 31 January 2024, subject to ongoing review and approval by the Board and the Company's shareholders , and the anticipated disposal of Summa completing on the agreed terms.
Publication of Full Year Results
The Group intends to release its Full Year Results for the year to 31 January 2022 on 13 June 2022.
Brian Marsh OBE
Chairman
7 February 2022
Chief Investment Officer's Update
Over the year ending 31 January 2022, our underlying portfolio has continued to perform well, notwithstanding the lingering challenges posed by the Covid-19 pandemic. This performance is expected to continue throughout the Group's current financial year, to 31 January 2023, in which we see many opportunities for further growth.
Over the last 12 months, our focus has been on our existing portfolio, and in the final quarter, the Group made a number of realisations.
This has resulted in an increase in the Group's liquidity, with a forecast cash balance of approximately £18.2m, subject to the completion of the sale of Summa Insurance Brokerage S.L..