ICG Enterprise Trust Q2 2026 Earnings Report

ICG Enterprise Trust EPS Results

• Actual EPS: -GBX 28.47
• Consensus EPS: N/A
• Beat/Miss: N/A
• One Year Ago EPS: N/A

ICG Enterprise Trust Revenue Results

• Actual Revenue: N/A
• Expected Revenue: N/A
• Beat/Miss: N/A
• YoY Revenue Growth: N/A

ICG Enterprise Trust Announcement Details

• Quarter: Q2 2026
• Date: 10/7/2025
• Time: Before Market Opens
• Conference Call Date: Tuesday, October 7, 2025
• Conference Call Time: 7:30AM ET

ICG Enterprise Trust (LON:ICGT) is focused exclusively on investing in buyouts in North America and Europe. Through our experience, global network and focus on defensive growth, we seek to deliver attractive long-term returns.

ICG Enterprise Trust Q2 2026 Earnings Call Transcript

Key Takeaways

• Positive Sentiment: ICG Enterprise Trust generated £222 million of realisations in H1 FY26, already surpassing full FY25 proceeds and with further exits imminent.
• Positive Sentiment: Underlying portfolio companies delivered 15% EBITDA growth over 12 months, reflecting resilient performance amid shifting macro conditions and stable valuation multiples.
• Positive Sentiment: Secondaries exposure increased to 17% of the portfolio via £42 million of H1 investments, on track to meet the 25–30% target allocation.
• Positive Sentiment: Strong capital allocation with £28 million returned in dividends and buybacks, 8% of shares repurchased since October 2022 boosting NAV per share by 3.3%, and £187 million of available liquidity.
• Neutral Sentiment: H1 NAV per share total return was –0.7% largely due to a –2% FX headwind in Q1, though Q2 delivered +1.9% and long-term NAV and share price returns remain in double digits.

Presentation

[Operator]

Good afternoon. Welcome to ICG Enterprise Trust's half-year results for the six months to July 31st, 2025. I'm joined today by Oliver Gardey and Colm Walsh, who will discuss our investment performance and activity in more detail over the course of this presentation. The slides, along with the accompanying results announcement, are available on our website. We will have time for Q&A at the end. If you'd like to submit a question, please do so through the online portal at any point in the Q&A box on your screens. We'll then aim to answer those at the end of the session. With that, Oliver, over to you.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Thanks, Martin, and good afternoon to everyone. We have a lot of newer investors, so we've included here three introductory slides. One is explaining our investment strategy, how we aim to deliver long-term growth, as well as outlining our dedicated team. Many of you already know the story well, so I won't spend a long time here. However, allow me a quick 60-second refresher, especially for those newer to us. If you look at the first slide here, the ICG Enterprise Trust's goal and mandate is really to provide our investors with compelling long-term compounding returns, but at the same time in a very resilient manner and try to reduce risk as much as possible within the private equity investment strategy. How do we do this? First of all, we focus only on mature buyouts.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

We avoid venture or growth, which have much higher loss ratios and are less compounding over a long term. We only focus on developed markets, North America and Europe. The reason for that is because they are the two deepest private equity markets with a strong pipeline of quality managers and deals, so that allows us also to reduce risk. We only focus on mid-market deals. Typical company size we look for is an enterprise value range of about GBP 250 million-GBP 2 billion. They're small by public market standards, but we think it's the right sweet spot for good companies, market-leading companies in niche industries and niche markets, and where there's a lot of exit optionality rather than being dependent with mega-cap companies, which are very dependent on the IPO cycle. Finally, we also focus on top-tier managers, typically not first-time funds, but managers with a proven track record.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Finally, we overlay that with active portfolio construction on the co-investment side. We're very much focused on resilient companies, companies and sectors where performance is not cyclical or seasonal. Those are kind of our main criteria, and I would call it our slide, our guiding North Star, to provide attractive private equity returns without the typical risk you're getting in private equity. Now, moving on to the next slide, just to provide some numbers, whilst the H1 NAV per share total return was -0.7%, it was, however, driven by a negative foreign currency impact of -2%, largely in Q1. Q2 performance was stronger. Our Q2 NAV per share total return was 1.9%. I think the numbers speak for themselves in the bar charts.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

You see that our focused investment strategy has very much delivered long-term double-digit returns on that NAV per share total return, as well as on the share price total return. Lastly, of our introductory slides, I'd like to spend some time on our team because we're particularly proud that we are the only ones in our peer group with a dedicated investment team entirely focused on the trust. The team is split between the London office and the New York office. We have a team of seven investment professionals focused on the ICG Enterprise Trust's portfolio. The investment committee, which is myself, Colm, and Liza, and we have over 60 years of combined experience.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

In addition to that, we leverage the wider ICG network, particularly on the we benefit a lot from our specialist LP secondaries expertise, where Ryan, Vivian, and I have been working closely together over 15 years, priorly at Pomona and now at ICG over the past five years. In addition to that, we invested in our operational support, and we're very excited to welcome our new fully dedicated CFO, Andrew Wolff, who joins us from Brookfield Asset Management and has over 20 years of finance experience. Now, let's turn over to our H1 results, and there are three key observations to share. Number one, our underlying portfolio companies are performing strongly, and we delivered earnings growth at 15% over the last 12 months. We're particularly pleased with the resilience of our portfolio companies, particularly given the complex and shifting macroeconomic landscape over the past year.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Number two, our total proceeds during H1 were GBP 222 million. This is already higher than the total proceeds of the full year of fiscal year 2025. In the short term, we have some additional visibility on additional exits, which Colm will talk about. Lastly, we are exceeding on our aims of increasing our secondaries exposure. We invested GBP 42 million in secondaries investments in these six months, which represents over 35% of the total investments we've done in H1. We are on our way to increase our allocation as we have promised. Moving on to the next slide, let's talk about our portfolio. Our portfolio is well positioned to continue to deliver long-term returns. By looking at it by investment category, the secondaries investments have increased our exposure to that part of the market from 15% at January 2025 to now 17% of our portfolio in July 2025.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Our geographical and sector exposure are broadly unchanged over the six months, and our largest exposures are in technology, consumer healthcare, and business services. We think these are very resilient sectors, and they continue to benefit from long-term structural growth trends. What you probably have seen in terms of the change since January are our top five companies. In January, this list featured Minimax and Datasite, which we realized during the period, and Colm will talk to more later. The notable risers on this list are Curium, Pharma, and Circana, which are both great examples of companies we like to invest in. They have established market positions, providing mission-critical services, and have a very high margin business model. With that, I'll now hand over to Colm, who will run through the H1 activity.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Fantastic. Thanks, Oliver, and good afternoon, everyone. In the next few slides, we're going to take a look at what happened over the last six months in the portfolio. Just as a reminder, we break down the investment lifecycle into four phases. Firstly, the beginning, making commitments to funds. Then we're called for capital or we invest directly into portfolio companies. That's the new investment phase. Typically, between years four and eight in the fund or deal lifecycle, that's when our managers get to work, start adding value. What we've referred to here is the growth phase. Finally, and most importantly, of course, selling the businesses typically to strategic buyers or to other financial buyers. The cycle repeats as realizations come in, our cash balance goes up, and we can then redeploy that capital into new commitments and then into new investments.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

In the last few periods, I think I've said this previously, I like to talk about the cogs in the machine. They've turned a little slower. That's not just for us, that's for the entire market, the entire private equity industry. As a result, realizations have been muted. I'm pleased to say, though, that in this six-month period, ICG Enterprise bucked that trend somewhat. The total proceeds in the half-year of GBP 222 million, which is already higher than the total proceeds of the full year for the previous financial year 2025. On the commitments and investment fronts, whilst the volume this period is broadly aligned year on year, the number and quality of opportunities we are seeing is growing. We remain optimistic about the current investment environment. Moving on to the next slide, which focuses on our new commitments.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

During the half-year, ICG Enterprise Trust made GBP 108 million worth of new fund commitments. That was spread across eight funds, mostly to a number of our longstanding managers in North America and Europe. Many names you might recognize, likes of THL, New Mountain Capital, and Advent, very longstanding partners. We also added a new manager in the form of Stone Point, where we committed to their Trident 10 fund. Stone Point is a really good example of the kind of manager we like to back. It's got a strong broader relationship with ICG. It's got a very good long-term track record with very low loss ratios. We believe we'll have the potential over time to offer very significant and very aligned co-investment deal flow. I'm going to cover now the largest commitment we made in the period. That was notably a EUR 25 million commitment to ICG Europe 9.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

That's ICG's flagship European corporate strategy. It's actually one of the we moved over to ICG. ICG became the manager of the vehicle back in 2016. Our relationship with ICG actually precedes that. This was one of the first strategies, one of the first fund strategies that the Enterprise Trust invested into back in 1989. It's a very, very longstanding fund relationship. Over that period, the strategy has focused on structured transactions. We believe these are particularly attractive for our investment strategy because they offer a very attractive risk-reward profile. It's also been a key co-investment partner for us. One of them was Minimax, which we first invested into in 2018 and was realized during the period. As Oliver mentioned, that was actually our largest underlying portfolio company at the end of the last financial year at 31st January 2025.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

You can see on the slide the core advantages of investing alongside this strategy. I've mentioned some of these already: strategic alignment, an attractive risk-reward profile, a longstanding and proven track record, and obviously, very importantly for us as well, very good access to co-investment deal flow in the kinds of deals that we like investing in. Minimax was a very good example of that. Moving on now to our new investments, we deployed GBP 113 million in the period. That was broadly similar to the same period last year. The largest investment was a co-investment alongside ICG's LP Secondaries Fund. That was in a deal called Project Domino. You can also see from the slide as well that we made a number of other direct investments into companies. One particular theme was increasing our exposure or reinvesting into some of our proven high performers.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

You'll see that we had a large realization Minimax. We didn't reinvest all of our proceeds, but we have chosen to reinvest into that company, a company we know well and which we believe continues to have the power to generate strong compounded growth. The same is true of Circana, European Camping Group. Earlier this year, we increased our, as you may be aware, increased our secondaries target weighting to 25%-30% of the portfolio. We continue to see compelling opportunities in secondaries and hopefully can add to Project Domino. It's a really good example of a diversified secondaries portfolio. It's very closely aligned with our strategy, very similar types of managers to those we have in our primaries program. It's highly diversified by sector, geography, and underlying company.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

It's also a deal where I think, as an investment house, ICG had very strong insights into the performance of a number of those funds. Moving on now to discuss performance and the underlying portfolio. The underlying portfolio companies are continuing to grow both revenue and earnings and recorded EBITDA growth of just over 15% over the last 12 months. The valuation multiples continue to be relatively stable, with an EV/EBITDA multiple of a little under 15.5x and net debt multiple about 4.7x. We're very comfortable with these valuation metrics given the performance. They reflect the quality of the underlying portfolio. When we compare these companies on a case-by-case basis to public markets, we continue to believe that they are typically at quite a significant discount to the nearest closest companies.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Moving on to our portfolio growth, as you can see from the chart across the half-year, portfolio growth on a local currency basis was 2.1%. This was offset by sterling strengthening, resulting in a portfolio return on a sterling basis of just over, so about 0.1%. The majority of that FX impact was actually experienced in Q1. In fact, FX was actually positive for us in Q2. In Q2, that's just the quarter, our NAV per share total return was 1.9%. We often see these short-term impacts from FX, but the thing to notice when you look over time, the impact of FX in our portfolio tends to even out. If you look over a five, ten-year time horizon, you will see that while FX will ebb and flow in particular quarters, it tends to even out over time.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Just an example of that, over the last 10 financial years, FX was positive for our NAV in six of them, negative for four. Over a ten-year time horizon, it had a net mildly positive impact on the portfolio. It's just worth noting as well as we've grown that our portfolio value at the end of the period was around GBP 1.4 billion. Now moving on to the final phase, to exit activity. I have already mentioned a number you've heard a few times in this presentation. Total proceeds in the period total GBP 222 million. As you can see from the graph, that figure already surpasses the whole of the previous financial year and is on a par with levels for FY 2023 and FY 2024. That was largely driven by realizations from three of our top 10 companies, as well as a secondary sale.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

We had Minimax, our largest underlying portfolio company at January 2025, fully realized. Datasite also fully realized, previously our fourth largest company, and a significant partial realization from European Camping Group, which was our eighth largest portfolio company. As I noted earlier, it continues to be a company that we are strongly invested in. You can also see another material contribution to our realization rate from the dark teal bars during the period. At least I'm told it's teal. I'm not sure I would have described it that way. During the period, we executed a fourth secondary sale, which was announced earlier in the year, very much part of our active approach to portfolio management, where we sold a portfolio of secondary funds to generate GBP 62 million of total proceeds. I did want to expand just on some of that theme of cash generation.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

It's been a particular highlight for this half-year. I've already mentioned Minimax, Datasite, and European Camping Group, high-quality companies that have generated strong returns for us. There are also a number of publicly known exits in the near-term pipeline. These are companies that are still in our top 30 largest companies, but where we can give you visibility on their exits. David Lloyd and Vernieri, these deals have both been prominent in the financial press. These will be full realizations, and we expect to get the proceeds from those realizations imminently. Both have delivered strong returns for ICG Enterprise. It's worth noting David Lloyd has been in the portfolio since 2013, but has actually delivered a very strong IRR return as well as a very strong cash multiple.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

As to our secondary sale, I'm not going to spend too long here because most of you on this call will have heard the story already. Just to recap, we have a very detailed and granular portfolio monitoring process. We review every fund. The challenge we always look at is the future performance of those funds and ask ourselves, you know, even if they have delivered strong historical returns, if there's limited future upside and we are able to get a good price in the secondary market, you know, we will look for opportunities to make those sales, to be able to redeploy those proceeds in other and potentially more lucrative opportunities. We believe that that optimizes our portfolio performance and therefore generates additional long-term value for our shareholders.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

On the back of the review at the end of last year, we executed a sale of a number of mature primary fund investments. It was a highly competitive process in a very buoyant secondaries market, which enabled those positions to get best execution. I'd say it was a very well-followed process and we think achieved a very good outcome. We executed the transaction at a 5.5% discount. As you will know, that's significantly lower than the implied discount to our NAV from our share price. We think that it offers additional validation of the NAV. It also helps to optimize our overall performance. It's a good segue into another slide that we obviously like to discuss and another key validator of our NAV, and that's uplifts on exit, one of the best proof points.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

In the last 12 months, we've had 40 full exits, and they've been realized at a weighted average uplift to carrying value of 15%. That continues a long-term trend of realizing exits at a premium, which you can see from this chart. It also crystallized a very strong return, the average being three times cost. It demonstrates the quality of our underlying companies. As I've also mentioned, it's a very strong validator of the NAV. With that, I'm going to hand back to Oliver just to conclude the presentation and take you through the final few slides.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Thanks, Colm. That gives you hopefully a flavor of investment activity over the period. The other two components I'd like to think about and talk to you about is allocating our capital, which are in the form of dividends and buybacks. Combining both dividends and buybacks, we returned GBP 28 million to shareholders in H1, fiscal year 2026. That figure actually rises to GBP 39 million if you include the remainder of the intended dividend for the fiscal year 2026. Buybacks have also been highly accretive. We have bought back 8% of our opening share count since our long-term buyback program commenced in October 2022. With that, we are one of the highest in our peer group. It's added about 3.3% to NAV per share total return. Turning to the financials in our balance sheet, at 31st July, we had a total available liquidity of GBP 187 million.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

That will increase, as you've heard from Colm, in terms of our realizations, as well as in terms of short-term, where we have visibility on short-term realizations. We have our gearing ratios at 5% and are therefore one of the lowest in the peer group. We have a low overcommitment ratio of 31%. This will all leave us in a good place going forward. We believe we're very well positioned to continue to invest in the portfolio, maintain the progressive dividend policy, and execute the share buyback program. Let's come to the concluding side and wrap it all up. Before we move on to some Q&A, I would like to highlight three key takeaways as we look ahead. Number one, as Colm outlined, it has been a very strong period of realizations already this year, and we have visibility of further exits to come.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Number two, we are very well positioned in terms of the balance sheet and in terms of portfolio split by geography, sector, vintage, and by company. Finally, I think with this strong balance sheet, we're well positioned, which means we can capitalize on attractive investment pipelines such as the secondary investment we did in Project Domino that Colm mentioned earlier, as well as we have a pretty good full co-investment pipeline. With that, over to you, Martin, for some Q&A.

[Operator]

Fantastic. Thanks, Oliver. We now have about 10 minutes or so for Q&A. As a reminder, please feel free to submit questions via the Q&A box on the webinar platform. A few have come in already, so taking them in turn. One, to start with, the rationale for Stone Point as a new manager. Maybe one, Colm, for you. It's a U.S.-based manager. Maybe broader than just Stone Point. How do we think about new managers, existing managers, and the diligence we do around that?

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Okay. I thought it was a very specific question, and then it's a broader one. Great question, though. Maybe I can explain it through the lens of Stone Point. Kinds of things we look for. We're very focused, and you'll have seen from the strategy slide, a core part of our focus is on top-tier managers. What we mean by that are managers that have successful long-term track records, that have a strong playbook, and something that is a strategy which is repeatable and can continue to generate value. We like managers that have a focus on low loss rates, protecting our capital. We like managers that have the ability to offer a significant co-investment deal flow. Stone Point very much ticks all of those boxes.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

In addition to that, it's got a very strong, and this is also actually a denominator for many of our funds, a very strong relationship with the broader ICG platform. That's really useful to us because it allows us to perform, I would say, very proprietary diligence in these firms because we've got so many colleagues who are working with them day in, day out on deals. We get access to a very, I think, very strong sort of set of institutional knowledge about how they conduct themselves, how they think about risk, what their market reputation is like. I think Stone Point's a very strong track record, particularly in their core sectors of financial services and business services. We believe as well, based on the historical track record, that they will be able to offer us a co-investment deal flow as well. That, of course, is a two-way street.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

There's a very trusted relationship between that manager and with ICG. That's very helpful to be able to get co-investments.

[Operator]

Right. Thanks, Colm. A few more questions have come in really on secondaries. Oliver, maybe one for you. Just generally at the minute, how are they pricing? What does good look like for a secondaries investment? Are they continuation vehicles? Maybe you can expand on the two strategies that ICG has, LP and GP-led, and just give some color on the market and how they're pricing currently.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Yeah. There's a lot in that question. Let me try to answer it in several ways. Let's start off first. At ICG, we have a GP-led strategy and we have an LP-led strategy. I hope most investors will be familiar with this, but just to explain it quickly, GP-led secondaries or continuation vehicle is where a fund manager takes a company out of the portfolio and puts it into a new continuation vehicle, thereby creating liquidity for the fund and its investors, but continuing to participate, and the investors have the choice to participate in the growth in the new vehicle and the new fund. LP-led secondaries are more classic secondary transactions where the secondary buyers buy private equity investors' stakes in buyout funds or in other venture growth funds. That's called LP-led stakes or LP-led secondaries.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

At ICG, we believe very strongly that those are two fundamentally very different businesses. That's why we have two separate teams. We pioneered that specialization, and we have two separate teams, two separate funds. One is called ICG Strategic Equity, which is the GP-led strategy, and the other one is called ICG LPS, standing for LP-led secondaries. Both funds are doing very well, are top quartile high performers, and have really utilized the specialization to be picking good funds. The Enterprise Trust is invested in both funds. The LP-led and ICG Enterprise Trust has benefited from a co-investment perspective from both funds. Curium, for example, which is now in the top five company, is a co-investment alongside ICG Strategic Equity, the GP-led fund. The recent Project Domino is a co-investment sourced by the LP Secondaries team. Those both strategies have generated great co-investment flow for the Enterprise Trust.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Let's step back for a moment on what's going on in the market. The momentum in the secondaries market, due to the lack of liquidity over the last three to four years, has been enormous. There's enormous momentum. Just to give you a rough highlight, over the last three to four years, the overall secondaries market has doubled from about GBP 100 billion in size to expected this year, about GBP 200 billion in size. There's an enormous amount of pipeline deal opportunities. At the same time, investors have realized that too, and a lot of money has also gone into the market. Pricing has stayed stable. It is around, for good quality managers, it's just below the 10%. For more of the average type of buyout fund managers, it's somewhere around the low teens to mid-teens in terms of pricing.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

That has been pretty stable over the last couple of years and is, in our opinion, a kind of a healthy discount. We think the balance between demand and supply is quite healthy. We see some great secondary opportunities, which is why we did Project Domino. At the same time, if you find the right buyer, you can also take advantage of good pricing for certain funds, which is what we did in the first quarter of this year, where we sold a portion of secondary funds.

[Operator]

Great. Thanks, Oliver. A question's just come in on the exit activity. Specifically, the question is, what do you think is the cause for you bucking the trend of weak realizations in the market in H1? Maybe, Oliver, you want to start, and then Colm, feel free to chip in.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

I think the main reason for bucking the trend at the end of the day is the quality of the portfolio. We have a very high-quality portfolio of companies which are kind of in the mid to large cap. We're not dependent on big IPOs, mega-cap. Our portfolio doesn't have a lot of mega-cap companies in there. Visma is probably one of the exceptions, Visma and Chewy. Typically, we are very much built up exposure and are focused and concentrated around companies and the kind of market leaders and great businesses and great industries or sectors. Enterprise value, GBP 2 billion-GBP 5 billion, which is our sweet spot and where we see the sweet spot in terms of liquidity.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

If you have good companies, you have many exit optionalities, such as other private equity financial sponsors buying the company, being part of a buy and build where other companies would like to own the company, and strategic investors. I think the lack of mega-cap and being less dependent on the IPO cycle has really helped us in creating exit opportunities in the portfolio.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Yeah. I think I would just echo all of that. I think it really is all about the quality of the companies, as Oliver was saying, and some great individual stories. Vernieri, I feel like Vernieri has followed me my entire career. We first invested in it in 2013. I actually, in a previous life, at a previous employer, did some work for what was then Richmond Foods. It was a very small food producer in Yorkshire. It's gone on over the last 15 years to become the world's second largest manufacturer of ice cream. It's done that. I think it's a really good exemplar of the strength of the private equity model to allow businesses to grow and to compound and add value. We've benefited at Enterprise Trust from that growth path since 2013.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

It's been an extraordinary journey and a real testament to the quality of the manager we back as well.

[Operator]

Great. Thanks, Oliver. Thanks, Colm. There are two more questions building on the exit environment. If we take them both together, question one is, given longer hold periods, are we willing to hold for longer until, as this person's put, until the right return can be obtained? If I build on question two, just given the changes in the private equity market, longer hold periods, as you mentioned, what is your view on the long-term contribution of premiums on exit? Will that uplift figure go down, go up, or stay the same over the long term? Colm, do you want to take that?

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Yeah. Actually, we've got a really good example. I think it's a really good answer to that question through the case study of David Lloyd. David Lloyd is a business we've held since 2013. Over that time period, there have been some ups and downs. I mean, the most obvious down point was during the COVID pandemic. I don't know if you recall, but gyms were about the health clubs were more or less the last things to reopen as Britain emerged from the COVID pandemic. It was an especially challenged time to be operating in that sector. It had performed very well out of the gates from 2013 to 2019. It might well have been sold, but obviously, it was held for longer because of that.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

We had a manager who I think was able to take advantage of the different sort of ebbs and flows of that cycle and was able to actually hold onto the asset for 12 years, much longer than we would have thought. In the end, we've made a very strong high-teens return despite the long holding periods. It's a really good example of, you know, this is a strategy where you don't, our managers don't have to sell. Part of the power of the private equity model is the ability to sometimes hold things a little bit longer just to optimize that portfolio performance. Maybe just to touch on the question about the uplifts. The uplift number is a little bit lower in this period than it has been in previous periods. Some of that is just a function of the types of exit.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Typically, we see the biggest premiums when we have more strategic buyers, or in particular, strategic buyers, but also to some degree financial buyers. Some of the recent exits we've had have been from structured deals where you get a more contractual return, and that means there's a lower percentage uplift. That's just sometimes a feature of the mix of the different types of exit that we have.

[Operator]

Great. Thanks, Colm. There's a question on portfolio return and EBITDA growth numbers. This question from an analyst is really to bridge the gap. EBITDA growth was pretty strong at 15%. This analyst acknowledges it is not linear between the two numbers. I should say that the last 12 months' EBITDA growth of 15% and then the last 12 months' portfolio return on a local currency basis is 8.4%. Colm, maybe with you first, can you sort of just explain maybe some of the elements of that bridge from the 15% underlying portfolio growth and then the local currency portfolio return of 8% last 12 months?

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Yeah. First of all, in very simple terms, over time, we believe that when you have strong EBITDA growth, you get strong portfolio performance. What you will find, if you look back at the historical numbers for both our portfolio return, and by the way, we're one of the few listed private equity vehicles that actually disclose the portfolio return as well. We leave ourselves a little bit open to this question. When you look over long time periods, that transmission mechanism is there. It doesn't always translate, particularly, you know, it doesn't translate perfectly in particular years or half-year periods. There are various different sources of disconnect. For example, many managers hold new investments at cost for the first year.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Even if there is strong EBITDA performance, that is not reflected in the valuation. There are also different impacts on valuation that come from how companies are, how their capital structures work. Companies with higher leverage, higher EBITDA, so EBITDA will lead to higher, all else equal, higher portfolio growth. There is also timing as well. When you see our top 30, it includes investments that haven't necessarily been in the portfolio for the whole year. I could spend ages going on about all the different disconnects. Suffice it to say, though, that when you look over time, we would expect those high EBITDA growth to translate into commensurately high portfolio growth. It's worth noting, as I say, we have some years where it's the other way around, where you have higher NAV growth, sorry, higher portfolio growth than you have EBITDA growth, for example, in 2021.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

It really is just one of those anomalies that you will find in the way things are, the way the reporting works.

[Operator]

Great. Thanks, Colm. There's one final question I see on the robust balance sheet point you mentioned, Oliver. You mentioned a gearing ratio of 5% and an overcommitment ratio of 31%. The question really is, is there a range that we're happy with? What sort of ratios would be considered too high? Any color you can share would be helpful.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

I do think, as you can compare to our peers, the whole peer group is healthy. I don't think that where the peers, where the ranges are, is an unhealthy industry or unhealthy range. However, we do feel pretty good about having been on the more robust end of it, particularly as we're going into a phase where we think there are going to be continuing some interesting investment opportunities, particularly on the secondaries and the co-investments. We appreciate having a very robust balance sheet and having good solid firepower to consistently invest over the years and over vintages. I think we're in a great place. Can we use a little bit more in terms of leverage or being in the range? Absolutely. As you see, our peer group is very healthy in that range. However, we're very happy where we are right now.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

We're trying to continue to be around the kind of 30% overcommitment ratio, and I think that's a good place to be.

[Operator]

Great. Thanks, Oliver. Thanks, Colm. I see no further questions online. If there are any follow-up questions after this webinar, please feel free to contact the email address that you see on your screens. As a reminder, a recording of this event will be available on our website in the coming days. With that, Oliver, Colm, thank you very much. Thank you all for joining today.

[Colm Walsh, Portfolio Manager at ICG Enterprise Trust]

Thank you, everyone.

[Oliver Gardey, Head of Private Equity Fund Investments at ICG Enterprise Trust]

Thanks, everybody. Bye-bye.

Participants

Executives

• Oliver Gardey, Head of Private Equity Fund Investments
• Colm Walsh, Portfolio Manager