3i Group plc announces intention to return £500 million of capital to shareholders on back of strong performance

12 May 2005
  • Total return on opening shareholders' funds of £512 million
  • Realisation proceeds of £1.3 billion
  • Proposal to return £500 million of capital to shareholders

Preliminary results for year ended 31 March 2005

Total return on opening shareholders' funds 15.9%
Net asset value per share 603p
Final dividend 9.3p
Realised profits on disposal of investments £260m
New investment £755m
- Including co-investment funds £962m
Realisation proceeds £1.3bn
- Including co-investment funds £1.7bn

 

Highlights

  • A total return of £512 million representing a return of 15.9% on opening shareholders' funds.
  • Realisation proceeds on the sale of assets of £1.3 billion generating realised capital profits of £260 million. Equity realisations were made at an uplift of 40% over opening values.
  • Investment in the year of £755 million (£962 million including co-investment funds).
  • Full year dividend of 14.6p, up 4.3%.
  • Announcement of intention to return £500 million to shareholders through:
    • a special dividend of approximately £250 million and
    • an on-market share buyback programme of approximately £250 million.

Baroness Hogg, Chairman of 3i Group plc, said: 

"Our last financial year was a year of progress on many fronts. The results for the Company are a good financial performance and strong cash flow, an enhanced competitive position and opportunities to grow value for shareholders in the years ahead. Our very high level of realisations has afforded the opportunity to return £500 million to shareholders, thus improving our capital efficiency."

3i's Chief Executive, Philip Yea, said: 

"I believe we have made good progress in the acceleration of 3i's development as a truly international private equity firm. Our returns have been such that it makes sense to propose a return of capital to shareholders."

Commenting on the outlook, he added: 

"Despite the hesitancy apparent in the financial markets I intend to report good progress towards our performance and strategic goals in the year ahead."

Return of capital to shareholders
3i is focused on delivering a strong performance in terms of return on equity. In this context, the Board has carefully assessed 3i's capital base and intends to return £500 million to shareholders. The Board proposes to pay a special dividend of 40.7p per share (approximately £250 million). This dividend is to be linked to a consolidation of shares and, if the consolidation is approved by shareholders, the dividend is expected to be paid in July. The Board also proposes that, subject to shareholder approval, the balance of about £250 million (representing approximately 6% of 3i's issued share capital at 3i's current share price) will be returned through a programme of on-market purchases of 3i shares commencing in July. On the basis of current market conditions, it is likely that these purchases will be executed at prices which exceed 3i's latest published net asset value per share.

It is intended that shareholder approval for these proposals will be sought at an extraordinary general meeting to take place immediately following the AGM on 6 July. A circular convening the EGM and giving more information and detail on the proposals is expected to be sent to shareholders in June.

For further information, please contact:

3i Group plc
Philip Yea, Chief Executive -  020 7975 3386
Simon Ball, Finance Director - 020 7975 3356
Patrick Dunne, Group Communications Director - 020 7975 3283

Maitland Consultancy
Philip Gawith - 020 7379 5151

For further information regarding the announcement of 3i's annual results to 31 March 2005, including video interviews with Philip Yea and Simon Ball (available 7.15am) and a live webcast of the results presentation (at 10.00am, available on demand from 2.00pm), please see http://www.3igroup.com/.

Notes to editors
3i is a world leader in private equity and venture capital. We focus on buyouts, growth capital and venture capital and invest across Europe, in the United States and in Asia. Our competitive advantage comes from our international network and the strength and breadth of our relationships in business. These underpin the value that we deliver to our portfolio and to our shareholders.