Duke Capital reported outstanding financial results for the fiscal year ending March 31, 2024. The company’s performance has been characterised by record-breaking figures in several key areas, reflecting its resilient business model and strategic execution. Canaccord Genuity’s analysis, led by Portia Patel, now forecasts recurring cash revenue to grow by 12% year-over-year, a reduction of 8% on previous forecasts due to challenging macroeconomic conditions.
Duke Capital’s total cash revenue for FY24 reached a historic high of £30.3 million, marking a 38% year-over-year increase and exceeding Canaccord Genuity’s forecast by 8%. This impressive revenue growth is attributed to successful and profitable exits from investments in Instor, Fairmed, and Fabrikat, which earned substantial exit premiums. Excluding these premiums and gains from equity sales, recurring cash revenue also hit a record £24.3 million, a 12% increase from the previous year.
The company reported free cash flow (FCF) of £17.9 million, a remarkable 40% increase year-over-year, with FCF per share rising to 4.34p from 3.21p. Duke maintained its dividend per share at 2.8p, consistent with the previous year, reflecting its commitment to returning value to shareholders. Patel noted that management is likely to maintain the dividend, preferring to allocate capital resources to growing the investment portfolio.
During FY24, Duke made significant deployments totalling £46.6 million, including approximately £42 million in hybrid credit investments and £3.7 million in equity investments. A notable new financing agreement of £14.5 million with Integrum highlights Duke’s continued focus on strategic investments that offer strong returns.
The company did report a small negative fair value movement of £6.9 million, primarily due to the planned unwinding of unrealised gains and minor write-downs in the hybrid credit investment portfolio. Despite these adjustments, the overall portfolio performance remains robust, and Duke’s approach of potentially increasing equity ownership in underperforming investments is aimed at maximising shareholder value.
Looking ahead, Canaccord Genuity anticipates continued positive performance for Duke Capital. The forecast for recurring cash revenue in FY25 remains strong, despite ongoing macroeconomic challenges impacting some investee companies. In such circumstances, Duke may seek greater equity ownership to protect and maximise shareholder value.
Duke Capital Limited’s FY24 results highlight its strong financial health and strategic acumen. The company’s ability to achieve record revenues and maintain stable dividends amidst economic uncertainty speaks volumes about its operational resilience and commitment to creating long-term value for its stakeholders.
Duke Capital Limited (LON:DUKE), formerly Duke Royalty Limited, is a Guernsey-based provider of hybrid capital solutions for small and medium-sized enterprises (SME) business owners in the United Kingdom, Europe and North America, combining the features of both equity and debt.
