Molten Ventures PLC (GRWXF) Full Year 2025 Earnings Call Highlights: Strong Realizations and ...
Fair Value Growth: GBP72 million or 5% increase, comprised of GBP180 million valuation uplift and GBP108 million valuation reductions.
Adverse FX Headwinds: GBP22 million impact.
GPV (Gross Portfolio Value): GBP1.4 billion.
NAV (Net Asset Value): GBP1.2 billion.
Realizations: GBP135 million, exceeding GBP100 million guidance.
Investments: GBP73 million into the portfolio, plus GBP34 million from EIS and VCT funds.
Share Buybacks: GBP15 million completed, with a further GBP15 million ongoing.
NAV per Share: 671p, up from 662p last year-end.
Cash Position: GBP89 million at year-end, plus GBP30 million from post-period realizations.
Undrawn RCF (Revolving Credit Facility): GBP60 million available.
Target Annual Returns: 20% through the cycle, with an average annual return of 28% since IPO.
Portfolio Realizations Target: 10% of portfolio value annually, with an average of 15% since IPO.
Core Portfolio Average Revenue: Over GBP400 million.
Core Portfolio Gross Margins: 70%.
Core Portfolio Growth Rate: 35%-36%.
Core Portfolio Profitability: 44% of companies turning to profitability.
Warning! GuruFocus has detected 4 Warning Signs with VRA.
Release Date: June 11, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Molten Ventures PLC (GRWXF) reported strong realizations, exceeding their guidance with GBP135 million in exits, demonstrating effective portfolio management.
The company achieved a fair value uplift of GBP72 million or 5%, despite adverse FX headwinds, indicating robust portfolio performance.
Molten Ventures PLC (GRWXF) has a strong cash position with GBP89 million at year-end and additional liquidity from recent realizations.
The company has implemented a balanced capital allocation policy, including share buybacks, enhancing NAV per share returns.
Molten Ventures PLC (GRWXF) is well-positioned with a refocused strategy on Series A and B investments, aiming to drive shareholder value and capitalize on differentiated return profiles.
Despite the fair value uplift, the GPV and NAV slightly decreased due to realizations exceeding investments.
Adverse FX movements negatively impacted the fair value growth by GBP22 million.
The technology sector's public company multiples have softened, affecting some portfolio company valuations.
The company acknowledges that it is currently investing at about half the level of capital it could be for the size of the market.
Molten Ventures PLC (GRWXF) faces competition for the best deals, requiring disciplined pricing strategies to ensure value.
Q: How have valuation multiples for new investments changed compared to a year ago, and what is the current competition for capital? A: Ben Wilkinson, CEO, explained that AI investments are receiving a 30% premium in pricing. Overall, pricing has remained static compared to the previous year. Companies are becoming more capital efficient, raising less capital and extending the duration between funding rounds to about two years. Competition for the best deals remains, but Molten Ventures is disciplined with pricing. The European market invested about 66 billion last year, similar to levels from three years ago, indicating a healthy depth of capital.
Q: What progress has been made in raising third-party capital, and can we expect any transactions this year? A: Ben Wilkinson, CEO, stated that raising third-party capital is a long-term goal. They are exploring the right vehicle for this, such as a GPLP structure. The most immediate third-party structure is Molten East, targeting a first close of around EUR100 million within the financial year, focusing on Eastern European development centers.
Q: What is the expected split of investments for this year, and what is the typical timeframe for realizing secondary investments? A: Ben Wilkinson, CEO, mentioned that follow-ons are expected to be around GBP15 million to GBP20 million, similar to previous years. Approximately GBP15 million will go into Fund of Funds, and another GBP15 million to GBP20 million into new secondary opportunities. The typical timeframe for realizing secondary investments is around two to three years.
Q: How should we think about realizations over the next few years, and any updates on the Connect Ventures investments? A: Ben Wilkinson, CEO, noted that the core portfolio, valued at over GBP800 million, should turn to cash over the next two to four years. Regarding Connect Ventures, Typeform and Soldo are mature businesses with potential pathways to market, depending on market conditions.
Q: How is Molten Ventures positioning itself for the AI wave, and are there any changes in the investment team? A: Ben Wilkinson, CEO, highlighted that they are focusing on hiring into the investment team, including a Chief People Officer to manage junior team members' growth. They are open to bringing in more talent to align with technological shifts and ensure the team has the necessary expertise.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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