Rockwood Strategic Plc
(“RKW or the “Company”)
Interim results for the six months to 30 September 2022
Rockwood Strategic Plc (LSE: RKW) is pleased to announce its unaudited results for the six months ended 30 September 2022 (the “Period”).
Highlights for the period:
§ Net Asset Value (NAV) Total Return in the Period of -10.4% to 1446.7p/share which compares to the FTSE Small Cap (ex-ITs) of -20.3% and FTSE AIM All Share of -22.6%
§ Total Shareholder Return in the Period was -0.35%. At Period end the Company traded at a discount of 2.2% to NAV
§ No. 2 ranked fund by Total Shareholder Return in the AIC UK Small Companies sector over the last 6 and 12 months, achieving 0.9% positive performance whilst the FTSE Small Cap Index (ex-ITs) fell 26.6% and the AIM All-share even more, down 35.2% (LTM)
§ NAV Total Return performance in the three years to 30 September 2022 of 44.3% which compares to the FTSE Small Cap (ex-ITs) of 6%. The Total Shareholder Return in the same three year period was 65%, ranked No.1 in the AIC UK Small Companies sector
§ Investment gains realised in the Lakes Distillery Bond delivered a 21.6% IRR and £3.1m cash
§ Net cash of £2.4m at the end of the Period (representing 6.6% of NAV)
§ Seven new investments were made across a range of industry sectors
§ The Investment Manager is comfortable that overall the portfolio is well financed. In summary 9 holdings have a net cash position, 4 are lowly leveraged and 2 have elevated debt
Noel Lamb, Chairman of Rockwood Strategic Plc, commented:
“Remaining entirely immune to the tumultuous conditions in markets is an impossible task for an active small companies investment strategy. The Board is therefore pleased that the portfolio is demonstrating relative resilience when compared to peers and small company indices. We are reassured the multi-cycle experience of the investment manager is clearly supporting a proactive approach to identify opportunities to deliver future NAV growth.
During the Period, shareholders overwhelmingly voted to re-start actively investing in U.K. small companies under our differentiated Investment Policy and also to transition from AIM to a premium listing on the main market of the London Stock Exchange. The Company was renamed, Paul Dudley joined the Board and a number of service providers were transitioned to improved and lower cost solutions. Despite the market challenges the period was one of significant progress and change for the Company. We are confident the strategy, portfolio and Investment Manager can continue to navigate the environment well and deliver future value creation for shareholders.”
Richard Staveley, Fund Manager, Harwood Capital, commented:
” We are excited about the upside potential in the portfolio, a lot of which, in our view, could be realised through corporate activity in due course as trade buyers and private equity appraise the significant undervaluation and profit potential of our holdings. Our ‘value’ bias is serving shareholders well, providing a ‘margin of safety’ and we are re-building the portfolio with outstanding investment opportunities to drive NAV over the medium-term. There is no doubt the economic environment will remain challenging, but we observe highly depressed valuations, deeply pessimistic assumptions and even greater inefficiency in our broadly ignored target universe. We are comfortable our investments in the overall portfolio remain well financed. This is an attractive backdrop for investors with capital, patience and value discipline. We have all three and are clearly aligned with shareholders.”
The full version of the RKW interim report will be available on its website shortly at www.rockwoodstrategic.co.uk
For further information, please contact:
Rockwood Strategic Plc
| Noel Lamb | Chairman | noellamb@finnebrogue.co.uk |
| Harwood Capital LLPInvestment Manager | Christopher Hart | 020 7640 3200 |
| Singer Capital Markets Advisory LLPBroker | James MaxwellAlex BondJames Fischer | 020 7496 3000 |