Hg Capital: A Year of Significant Outperformance

7th March 2022 | Hg Capital Trust PLC



HgCapital Trust plc (‘HGT’), today announces its annual results for the year ended 31 December 2021.

HGT provides investors with a listed vehicle to invest in unquoted businesses managed by Hg, Europe’s largest investor in software & service businesses.

The objective of HGT is to provide shareholders with consistent long‑term returns in excess of the FTSE All‑Share Index by investing predominantly in unquoted companies where value can be created through strategic and operational change.

Highlights over 2021 include:

  • Strong portfolio trading resulting in robust portfolio performance with a total return NAV increase of 44% to a record high of £4.40 and net assets of more than £2 billion
  • Record level of investment, deploying £424 million alongside Hg, Europe’s largest investor in software & service businesses
  • £271 million of returns realised on behalf of HGT and £141 million of new equity raised
  • Significant and consistent outperformance of the FTSE All-Share
  • Performance provided through access to Hg’s investments, which would in aggregate represent the second largest and the fastest growing technology firm in Europe*

An investment of £1,000 made 20 years ago in HGT would now be worth £24,134, a total return of 2,313%. An equivalent investment in the FTSE All-Share Index would be worth £3,360.**

Jim Strang, Chairman of HGT, commented:

“As I noted in my last review, HGT and its portfolio have coped well with the challenges presented by the COVID-19 pandemic. The defensive nature of the businesses within the portfolio and the operational skill of Hg have both contributed to the success of HGT in weathering this challenging period. I am happy to report that our full-year results continue to see the portfolio delivering strong growth and excellent returns.

While 2021 has been very encouraging for HGT, we have all witnessed the recent events unfolding in Eastern Europe. Your Board remains extremely focused on ensuring that the risks inherent in managing a successful and fast-growing investment company, during such uncertain times, are fully addressed. Despite the challenges in the external environment and the volatility they may induce, the Board is confident about the future prospects for HGT.”

David Toms, Head of Research at Hg, commented:

“The overarching driver of Hg’s performance – digital transformation of business activity – continued apace in 2021 and the structural backdrop remains robust. Coupled with the move to a Software-as-a-Service model, we remain of the view that we are still early in a generational shift in market opportunity.”

Below is a short animated clip highlighting the key points from the Year End Results