Bailador\u2019s NTA per share plus net dividends paid rose 9.8% in H1 FY24
\nPrivate company investments of tech-focused capital fund well-positioned
\nPortfolio currently evenly weighted between private and public investments plus cash<\/p>\n
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Special Report: <\/em>At the halfway point of FY24, tech-centric capital fund Bailador Technology Investments is in a robust position, with its private company investments well-positioned for growth.<\/strong><\/p>\n Bailador Technology Investments (ASX:BTI)<\/strong><\/a>\u00a0has reported its post-tax net tangible assets (NTA) per share, plus net dividends paid, increased 9.8% in H1 FY24.<\/p>\n Co-founder and managing partner Paul Wilson says the increase was made up of a gain in the value of the post-tax portfolio \u2013 investment gains less expenses \u2013 of 15c\/sh adjusted for the payment of 3.2c\/sh fully-franked dividend.<\/p>\n \u201cOur private company investments continue to be well-positioned,\u201d he says.<\/p>\n Wilson says, in line with its dividend policy, BTI paid its final FY2023 fully franked dividend of 3.2 cents\/share to shareholders in September 2023, which delivered an annualised dividend yield of 7.3% when grossed-up for franking credits<\/p>\n The company\u2019s policy is to pay 4% per annum of NTA pre-tax, including 2% of June NTA and 2% of December NTA. However, historically the actual dividend yield paid to shareholders has consistently been higher than this.<\/p>\n Wilson says the interim dividend implied by December\u2019s pre-tax NTA based on unaudited numbers is 3.5c\/sh (fully franked), which remains subject to discretion of the board. This implies an annualised grossed-up yield of 7.2% based on Bailador\u2019s shareprice of $1.295 at the time of publication.<\/p>\n \u00a0<\/p>\n In July 2023, BTI completed the cash realisation of InstantScripts receiving $51.6 million in cash with final adjustments processed in November.<\/p>\n The realisation followed InstantScripts acquisition by Wesfarmers (ASX:WES)<\/strong><\/a> subsidiary Australian Pharmaceutical Industries Pty Ltd (API) in a deal worth ~$135 million.<\/p>\n Wilson says the realisation was at a value 25% higher than its previous carrying value and generated a cash IRR of 60.9% on its investment.<\/p>\n BTI initially committed $5.5 million to InstantScripts with additional $24.7 million in subsequent investments, reflecting their conviction in the company\u2019s potential.<\/p>\n InstantScripts provides online prescription services, telehealth consultations, blood test arrangements and issuance of medical certificates.<\/p>\n Since its inception in 2018 by Dr Asher Freilich and Maxim Shklyar, the platform has served more than 600,000 customers and conducted more than 1 million consultations.<\/p>\n \u201cWe were pleased to continue our track record of realising our investments for cash at a value above our previous carrying value,\u201d he says.<\/p>\n \u00a0<\/p>\n During H1 FY24, BTI made two follow-on investments in private portfolio companies.<\/p>\n In December, BTI invested $900,000 in company RC TopCo, which was formed in June 2023 following the merger of worldwide tours and activities operators Rezdy (Australia & Pacific), Checkfront (Americas) and Regiondo (Europe).<\/p>\n BTI had been an investor in Rezdy and opted to take shares in the new merged company.<\/p>\n \u201cWe now own a significant share of a large worldwide tours and activities software business,\u201d Wilson says.<\/p>\n He says the team at RC TopCo have been busy in H1 FY24 adjusting cost bases, focusing product development, and aligning sales and marketing strategies.<\/p>\n \u201cWe continue to hold board representation on RC TopCo and are pleased with progress,\u201d\u00a0 he says.<\/p>\n Also in December, BTI invested $1.57 million in a convertible note with Access Telehealth.<\/p>\n Wilson says pricing of the note is tied to the pricing of a future transaction and does not impact the value for which BTI currently hold Access Telehealth.<\/p>\n \u201cHowever, as of December it had been 12 months since the last third-party transaction in Access Telehealth,\u201d he says.<\/p>\n \u201cConsistent with our valuation policy we reviewed the valuation and following a year of strong performance and pleased to write Access Telehealth up by 28%.\u201d<\/p>\n \u00a0<\/p>\n Wilson says the BTI portfolio is currently evenly weighted between private investments, public investments,and cash.<\/p>\n \u201cWe\u2019re pleased with the positioning of the portfolio companies and their prospects,\u201d he says.<\/p>\n Wilson says the cash realisation of InstantScripts and ~76% increase in the SiteMinder (ASX:SDR)<\/strong><\/a> share price in H1 FY24 are the primary drivers of the weighting shift since June 2023.<\/p>\n \u201cWe expect to see a substantial amount of cash move into private investments (both new and follow-on investments) throughout CY24.\u201d<\/p>\n\n Source: BTI<\/p>\n \u00a0<\/p>\n Wilson says SDR\u2019s growth guidance is unchanged and continues to target organic revenue growth of 30% in the medium term.<\/p>\n BTI was an early investor in SDR, which has become the world\u2019s leading SaaS businesses for connecting hotels to digital distribution channels.<\/p>\n \u201cThe company also continues to expect to be underlying EBITDA profitable and underlying FCF positive for H2FY24.\u201d<\/p>\n Wilson says its other public investment Straker (ASX:STR)<\/strong><\/a> continues to work on R&D to capture new channel opportunities associated with AI<\/a>.<\/p>\n STR is leading player in the AI language services and technology industry and launched a share buyback program in December 2023 to purchase up to 5% of the issued capital.<\/p>\n BTI has not sold any shares into the buyback.<\/p>\n \u00a0<\/p>\n Along with RC TopCo and Access Telehealth BTI\u2019s other private investments include end-to-end volunteer management software solution Rosterfy, which joined the portfolio in April 2023.<\/p>\n \u201cEverything we have seen since gives us confidence we have made a good investment,\u201d Wilson says.<\/p>\n \u201cThe company continues to grow strongly while investing in sales and marketing in the US and the UK, adding senior talent in Australia and developing world-leading product.\u201d<\/p>\n Wilson says its investment in Nosto arises from BTI\u2019s sale some years back of Stackla into the larger digital marketing services business Nosto.<\/p>\n \u201cNosto continues to focus on enhancing its product offering including introducing generative AI features and functionality into their Commerce Experience Platform,\u201d he says.<\/p>\n BTI is also an investor in Mosh, which digitally delivers high quality and easy-to-access hair loss, weight management and sexual health care for men.<\/p>\n \u201cIn August, Mosh bought The Healthy Mummy to accelerate its growth in female healthcare as well,\u201d Wilson says.<\/p>\n \u00a0<\/p>\n This article was developed in collaboration with Bailador Technology Investments, a Stockhead advertiser at the time of publishing. <\/em>\u00a0<\/em><\/p>\n This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.<\/em><\/p>\n <\/span><\/p>\n The post Tech-focused capital fund Bailador in strong position for H2 FY24<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"More than 60% return on InstantScripts investments<\/strong><\/h2>\n
Follow-up investments <\/strong><\/h2>\n
Investment portfolio evenly weighted <\/strong><\/h2>\n
Public company investments set for growth<\/strong><\/h2>\n
Confidence in private company investments <\/strong><\/h2>\n