Resilient H1 2020 performane despite pandemic
ADAM’s interims confirm operational progress, recent initiatives to strengthen its balance sheet and build investment capacity, plus details regarding ongoing efforts to stabilise legacy assets and move them towards satisfactory exit. The report covers the period ending 30 June 2020, the eye of the pandemic storm, during which underlying portfolio performance remained encouragingly robust.Total income was USD1.19m (H1 19: USD1.25m) and comprised interest payments and fair value adjustments. ADAM reported only a small, 0.69% decrease in consolidated NAV to USD 100.2m (GBP81.1m) vs H1 19, mainly related to lower cash.
ADAM’s income base continues to build, and it now has funds in place to secure new assets, supplemented post the period end, to be sourced from an active pipeline of prospective opportunities.It raised gross proceeds of USD1.7m via a new subscription to its corporate bond bringing the total raised by this initiative to c. USD3.6m. Then in August, post the period end, it closed a placing and open offer which raised GBP3.13m (USD3.8m) at 25p per share. Proforma net cash is c. GBP2.5m.
We estimate proforma NAV/share, adjusted for the latest share issue, and net new money raised is USD0.87 (GBP0.67). Catalysts for a narrower NAV discount than the 62% the shares currently trade at, include updates on the progress of investments such as FMH. ADAM has also confirmed its intention to continue to purchase shares at attractive levels via its existing Share Buyback Programme.
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