The key messages from ICG Enterprise Trust plc (LON:ICGT)T’s June 2024 shareholder seminar were i) ICGT has a focused and differentiated investment strategy with a dedicated investment team, ii) operating performance remains strong and capital structures are well positioned, iii) debt pricing is reducing and debt availability is accelerating, iv) access to the ICG platform brings substantial benefits, and v) the board has a focused and deliberate approach to long-term shareholder value. In our view, what defines ICGT’s uniqueness is the “defensive growth” approach, combined with the ICG manager benefits. This has delivered five-year, local currency portfolio returns of 17.1% CAGR, NAV p/sh. returns of 14.6% and shareholder total returns of 11.2%.
- Value creation: ICG Enterprise Trust adds value with i) an investment strategy delivering defensive growth through cycles (the key, in our view), ii) a managed cost base, with a management fee rate cap and ICG cost-sharing arrangement, iii) a balanced capital allocation, and iv) effective messaging/shareholder engagement.
- Capital allocation: The trust’s approach to shareholder distributions includes a progressive dividend policy (FY’21 24p, FY’22 27p, FY’23 30p, FY’24 33p), a long-term share buyback programme (£24m returned with 128 days in market Oct’22 to 13 Jun’24) and opportunistic buybacks (£7.4m in three days in 2024).
