Bailador Technology Investments releases strong H1 FY24 with net profit attributable to shareholders of $22 million
\nPortfolio companies expected to deliver a robust performance for remainder of FY24
\nEnding the half with $94 million in cash, the tech fund is well-positioned for further investments <\/p>\n
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Special Report:<\/em><\/strong> \u00a0Tech-centric capital fund Bailador Technology Investments has a released a strong H1 FY24 result and is cashed up to take advantage of new and follow-up investments during the remainder of the fiscal year. <\/strong><\/p>\n As optimism increases that central banks are nearing the end of their rate hiking cycle and may even start making cuts as inflation starts to fall \u2013 fuelling interest in growth stocks \u2013 Bailador Technology Investments (ASX:BTI)<\/strong><\/a> is well-positioned to further strengthen its position in the tech sector.<\/p>\n Among highlights of H1 FY24 were:<\/p>\n Net Profit attributable to shareholders was $22 million, up from a loss of $5.2 million in H1 HY23 \u00a0<\/p>\n The BTI portfolio ended 2023 in a strong position with seven investments. The combined portfolio revenue was $379 million, with 41% growth over the past 12 months, ~66% gross margin and ~96% recurring revenue.<\/p>\n \u00a0<\/p>\n BTI\u2019s post-tax NTA per share ended H1 FY24 at $1.64, 12 cents or 8% higher over the six months net of all fees.<\/p>\n When adding back the September 2023 fully franked dividend of 3.2 cents per share, BTI\u2019s post-tax NTA increased 10%.<\/p>\n The growth in NTA per share was largely driven by valuation increases to two major investments.<\/p>\n BTI says hotel bookings platform SiteMinder<\/a>, which was 36% of post-tax NTA, increased its valuation 76%.<\/p>\n The valuation of Access Telehealth<\/a>,<\/a> which was 9% of BTI\u2019s post-tax NTA, also climbed 28%.<\/p>\n BTI co-founder and managing partner David Kirk says the company achieved a strong result for shareholders in H1 FY24.<\/p>\n \u201cOur portfolio performance continues to shine with strong valuation uplifts in SiteMinder and Access Telehealth,\u201d he says.<\/p>\n \u201cThe rest of BTI\u2019s portfolio companies are in great shape and we expect to see strong performance from them for the remainder of FY24.\u201d<\/p>\n \u00a0<\/p>\n BTI declared an interim dividend of 3.5 cents per share, fully franked, representing an annualised yield of 5.2% on the closing price of BTI shares on February 6, 2024, or a grossed up annualised yield of 7%.<\/p>\n The dividend is part of BTI\u2019s ongoing commitment to pay regular dividends to shareholders\u00a0 totalling 4% of pre-tax NTA per annum.<\/p>\n Over the last 12 months, BTI has paid or declared a total of $9.7 million or 6.7 cents per share in fully franked cash dividends to shareholders.<\/p>\n The company has previously acknowledged that many Australian investors appreciate receiving valuable franking credits<\/a>, where the value of tax paid by a company is passed back to shareholders in the form of franking credits on distributed dividends.<\/p>\n \u201cBailador\u2019s regular fully franked dividends provide investors with a compelling ongoing yield, on top of exposure to the main engine of returns which is capital gains,\u201d Kirk says.<\/p>\n \u00a0<\/p>\n BTI says cumulative returns since the start of FY21 have been generated by:<\/p>\n Share price appreciation of 82% \u201cFactoring in share price appreciation, cash dividends received and franking credits received, $100k invested in BTI shares at the start of the 2021 financial year is worth $213k today,\u201d Kirk says.<\/p>\n He says for most investors, the grossed-up yield of 7.0% per annum is the appropriate number to compare to interest rates, which are not franked and superior to cash.<\/p>\n Furthermore, the company introduced its dividend reinvestment plan (DRP) in February 2020, which will apply to the declared dividend.<\/p>\n The DRP price was determined by the BTI board of directors to be a 2.5% discount to the VWAP over the four trading days from February 12-15, 2024.<\/p>\n With the franking credits balance sufficient to support fully franked dividends at the current rate for a period of five years, and ample cash balance, BTI says its DRP policy is intended to endure over a long period.<\/p>\n \u00a0<\/p>\n BTI co-founder and managing partner Paul Wilson says with net cash of $94 million as of December 31, 2023, the company is well positioned to take advantage of additional investment opportunities.<\/p>\n During 2023, BTI made a total of $29 million in additional investments, including $10 million investment in new portfolio company Rosterfy<\/a>,<\/a> which specialises in volunteer management software.<\/p>\n BTI also invested a further $19 million across several follow-on investments within the portfolio.<\/p>\n Wilson says it is likely that additional new and follow-on investments will occur during the remainder of FY24.<\/p>\n \u201cWith net cash of $94m, Bailador is in a strong position to undertake additional investments over the remainder of FY24 and take advantage of valuations for emerging technology companies which have largely returned to more realistic levels,\u201d he says.<\/p>\n \u201cWe are pleased to be positioned to provide our shareholders with certainty of an ongoing cash yield, while continuing to generate significant capital gains in portfolio assets, which remains the primary engine for returns.\u201d<\/p>\n \u00a0<\/p>\n \u00a0<\/p>\n This article was developed in collaboration with Bailador Technology Investments, \u00a0a 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 positions for more investments after robust H1 FY24<\/a> appeared first on Stockhead<\/a>.<\/p>","protected":false},"excerpt":{"rendered":"
\nInterim dividend declared totalling 3.5 cents per share fully franked represents an annualised 5.2% yield on BTI shares1 (7.0% when a grossed up for franking credits)
\n$52 million cash proceeds from full cash realisation of InstantScripts delivered 61% IRR
\n$29 million of capital deployed over last 12 months across new and existing portfolio companies
\nDividend reinvestment plan (DRP) active with a 2.5% discount<\/p>\nNTA per share growth driven by strong third-party valuations growth<\/strong><\/h2>\n
Almost $10m paid in dividends over 12 months<\/strong><\/h2>\n
Dividend returns better than cash<\/strong><\/h2>\n
\nCash dividends of 22%
\nFranking Credits of 9%<\/p>\nCashed up for new investment opportunities<\/strong><\/h2>\n