Molten Ventures portfolio value slips in first half

20th Nov 2024 09:05

(Sharecast News) - Venture capital firm Molten Ventures reported a steady first-half performance on Wednesday, with a gross portfolio value of £1.34bn, down slightly from £1.38bn at the end of March.

The FTSE 250 company said it achieved £76m in cash realisations, with an additional £48m expected post-period from the anticipated completion of the M-Files transaction, surpassing full-year guidance for realisation proceeds.

It said it invested £51m during the six months ended 30 September, including three new investments totaling £13m and follow-on funding of £8m across 12 portfolio companies.

Further allocations included £19m for a majority position in Connect Ventures Fund I and additional commitments to fund-of-funds and Earlybird funds.

Molten said its portfolio remained well-funded and diversified, with companies raising over £800m in capital transactions over the last year.

Core portfolio firms such as ISAR Aerospace, ICEYE, RavenPack, Revolut, and Riverlane completed capital raises at higher valuations.

Average gross profit margins for the core portfolio were forecast to increase to 70% in 2025, compared to 68% in 2024, while revenue growth was projected to slow from 71% in 2024 to a robust 48% in 2025.

Net assets stood at £1.21bn, with a net asset value (NAV) per share of 646p, down from 662p in March.

Cash reserves increased to £82m, with an additional £40m available for investment through managed EIS/VCT funds.

Operating costs remained below 1% of net asset value, reflecting disciplined financial management.

The company executed a £10m share repurchase programme in September, funded by realisation proceeds, as part of its capital allocation strategy.

Sustainability meanwhile remained a key focus, with enhanced ESG efforts including emissions assessments for portfolio companies and tailored guidance through Molten's 'Sustainability Toolkit'.

Looking ahead, Molten said it remained confident in its ability to navigate market conditions, leveraging its robust portfolio and disciplined capital allocation to deliver shareholder value.

"Announcing today's results as CEO, for a period in which I was CFO, I am pleased to report that realisations have been a highlight in the first half of the year and we have already surpassed the guidance provided at our full-year results, further validating the quality of our portfolio and the robustness of our valuation methodology," said chief executive officer Ben Wilkinson.

"Since IPO, Molten has realised in excess of £600m providing us with further capital to both support founders and grow and scale our business.

"We anticipate a more stable investment climate as visibility over the cost of capital improves, which should support stronger market valuations and increased fund deployment, both from private VCs and through our own capital."

Wilkinson said that as interest rates stabilised, the firm expected to see more aligned views between buyers and sellers, leading to greater market activity.

"To realise this potential, we reaffirm our focus on our core business, driving strong investment returns for all stakeholders.

"I look forward to outlining my priorities in further detail at the full year."

At 0855 GMT, shares in Molten Ventures were down 5.99% at 310.71p.

Reporting by Josh White for Sharecast.com.