Earnings release
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HgCAPITAL TRUST PLC TRADING UPDATE FOR THE YEAR ENDED 31 DECEMBER 2025 ESTIMATED NAV PERFORMANCE DRIVEN BY RESILIENT TRADING IN THE UNDERLYING PORTFOLIO IN CHALLENGING CONDITIONS London, 6 February 2026: HgCapital Trust plc ('HgT') today announces a trading update for the year ended 31 December 2025. HgT provides investors with a listed vehicle to invest in one of the largest and fastest growing portfolios of unquoted technology companies in Europe1, managed by Hg. The objective of HgT is to provide shareholders with consistent long-term returns in excess of the FTSE All-Share Index by investing predominantly in unquoted businesses where value can be created through strategic and operational change. Key highlights for 2025 include: ● Estimated NAV total return per share was 4.0%2 over the year, and as a result, at 31 December 2025, the estimated NAV per share stood at £5.62 with net assets of £2.6 billion (unaudited) ● The share price total return showed a decrease of 4.9%2, over the year at £5.07; market capitalisation at the year-end was £2.3 billion ● Strong underlying performance from the portfolio with LTM revenue and EBITDA3 growth of 17% and 20% and margins of 34% for the overall portfolio to 30 November 2025; in line with prior year figures ● Investments of £357 million made over the year and realisation proceeds of £215 million generated ● Realisations in 2025 included GTreasury at an uplift of 97% to book value, overall, exits over the year added 4.6 pence to the NAV ● In November, HgT announced the exit of Intelerad (due to complete in March 2026). The transaction price reflected an uplift of 62% to its last reported carrying value ● At year-end, HgT had available liquid resources of £368 million (including a £375 million credit facility, of which £36 million was drawn as at 31 December 2025) ● Outstanding commitments to Hg funds totalling £1.8 billion (68% of NAV) which are expected to be called over the next 4-5 years NAV performance HgT's unaudited estimated net assets of £2.6 billion at 31 December 2025, represent an estimated NAV per share of 561.9 pence, based on portfolio company valuations at 31 December and reviewed by the HgT Audit, Valuation and Risk Committee ('AVRC'). Estimated NAV total return for the year was +4.0%, as positive performance and exits above book value in H2 largely offset the decline in H1 2025 (-0.4%). Strong trading from the underlying portfolio companies was a key driver of performance over the year, contributing +17% to portfolio value. While trading remains the key driver of performance over the long-term, movements in comparable valuation multiples can impact performance over shorter-term periods, and this was the case during 2025. Elevated public market volatility saw multiples used to value HgT's portfolio companies contract, detracting from portfolio valuations by -7% over the reporting period. In addition, increases in net leverage, deployed to support future growth, further reduced valuations by -6%. Recent volatility in public market software companies Public market volatility has increased sharply through January and into February 2026, especially in the software sector, sparked by investor concerns about the potential impact of AI on the software industry, coupled with a pronounced rotation of capital out of software and into hardware (chips, memory and data-centre build-out). The broad-based decline in listed software shares and associated volatility has also had a pronounced negative impact on HgT's share price, which is down 20% this year to date. The recent widespread sell-off seen in the sector has been with little distinction made across the many different players in the space and their respective strengths and weaknesses. Given the strength of the HgT portfolio, the market positions that portfolio companies enjoy and Hg's skill and experience as a manager, the Board believes that the current share price represents significant value. Given the scale of the recent dislocation between the share price and the value placed on the assets within the HgT portfolio, the Board is actively considering a number potential actions to address the current discount to net asset value using the full set of tools at its disposal, including share buy-backs, and following the well-established processes HgT has developed to manage such situations. The Board is in constant dialogue with the Manager and its advisers around what proactive steps may be taken to mitigate the current situation; one example of which being the accelerated release of this trading update.
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While public market multiples (both software and tech-enabled services; US and Europe) are one input to Hg's valuation methodology, relevant private M&A comparables ('comps') form a material input for valuations, reflecting Hg's model of acquiring full or effective control of the companies within the portfolio. The weightings of these comps for each individual business means the valuation multiples are linked to, but do not fully track, movements in the public markets. Very broadly and depending on the mix of comparables and their relative movements, we see typically 20-40% of the movement in public comparables flow through to the multiples used to value our portfolio companies. The multiples derived from these relevant public and private comps are then applied to the earnings of the portfolio companies, which remain the key driver of valuations and long-term performance. The HgT portfolio businesses have typically grown their EBITDA by 10-15% organically each year, i.e. c. 3% each quarter. In addition, the impact of M&A activity may increase levels of growth in a given period. Despite the recent volatility and seemingly indiscriminate negative sentiment in public markets, HgT's portfolio companies continue to demonstrate strong organic growth, and strong margins, while balance sheets remain robust across the portfolio. Notably, Hg's significant investment in its own AI initiatives is rapidly building momentum and is now driving increased value creation across the portfolio. Furthermore, Hg has a strong track record of generating realisations at premia to carrying value, including during periods of heightened market volatility, with the significant majority of exits taking place in the private markets. Hg's view remains that AI presents significant opportunities for innovative, product-led, incumbent software companies. Hg has been investing in software for more than two decades and today we are investors and board members in nearly 60 privately-owned software and services businesses, providing us with granular insight into the interactions between SaaS businesses and their customers, informing our view on how AI will diffuse into the real economy. In his recent essay, Matthew Brockman, Hg's Chief Investment Officer, shares his perspectives on how AI is reshaping software, the opportunity this presents for incumbents and how Hg is working closely with its portfolio companies as they transition to be AI-first businesses: https://hgcapital.com/insights/everything-everywhere-but-not-all-at-once Investment activity ● HgT invested £357 million in 2025 with new and follow-on investments primarily in IFS, P&I, A-LIGN, Citation, Payworks, Diamant Software and Scopevisio, including £34 million of co-investment (on which HgT does not pay management fees or carried interest). Co-investments now represent c. 10% of NAV, increasing from 9% at the start of 2025, in line with HgT's long-term goal of 10-15%. ● Post-period investment of £93 million including a new investment in the take-private of OneStream. The transaction is expected to complete in April 2026. Realisation activity ● Gross proceeds from realisations during the year of £215 million. This includes proceeds from P&I, Citation, Trackunit, smartTrade and GTreasury. ● Realisations over 2025 saw an average uplift to book value of 25%, this highlights the attractiveness of the mission- critical companies in which the Manager continues to invest. ● Post-period saw the full realisation of Intelerad, announced in November at an uplift of c. 62% to its carrying value. The transaction is expected to be completed in March 2026. Pro-forma balance sheet Allowing for all transactions announced as at the date of this trading update: ● Pro-forma available liquid resources of £410 million (including a £375 million credit facility of which £32 million was drawn at the time of this announcement). ● Pro-forma outstanding commitments to Hg funds of £1.8 billion which are expected to be called over the next 4-5 years. Hg REPORTS STRONG TRADING AND TRANSACTION ACTIVITY OVER 2025 WHICH CONTINUES TO HIGHLIGHT THE STRENGTH OF DISCIPLINED FUND MANAGEMENT EXPERTISE IN CHALLENGING CONDITIONS Despite a challenging market environment, Hg continued to see robust investment and realisation activity over 2025, with a total of fifteen transactions announced or completed. This was accompanied by strong underlying trading performance across the portfolio. Investment activity has continued across all Hg funds, at levels consistent with the long-run average, with $6.1 billion deployed over the year. This activity continues to focus on businesses within the end-market, mission-critical software and services 'clusters'
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which Hg has tracked for many years. During 2025, Hg realised over $3.4 billion of proceeds from liquidity events (including all announced exits) as part of a continued focus on returning cash back to investors This record of realisations achieved compares favourably with peers, as the industry continues to find generating liquidity challenging. The performance achieved by Hg continues to show the fundamental strengths and attractiveness of the underlying portfolio companies to both trade and financial buyers. Hg continues to screen an attractive pipeline of investment opportunities and further liquidity events are expected over the next six to twelve months. HgT will publish the full Annual Report & Accounts for 2025 on 9 March 2026 The Company is satisfied that all inside information which the Directors and the Company may have in the period leading up to the announcement of its results for the year ended 31 December 2025 has been, with the release of this announcement, and will continue to be notified to the London Stock Exchange via a regulatory information service. Accordingly, the Company is not prohibited from dealing in its own shares. The mandatory closed period under MAR will commence on 7 February 2026 and will last until the annual financial results in respect of the year ended 31 December 2025 are published. 1 By Enterprise Value, Source: Hg, Factset. 2 Total return assumes that all historical dividends have been re-invested. 3 Excluding investments valued on a basis other than earnings - ends - For further information please contact: HgCapital Trust George Crowe george.crowe@hgcapital.com +44 7774 617 150 Laura Dixon laura.dixon@hgcapital.com +44 7824 59 2894 Hg Tom Eckersley tom.eckersley@hgcapital.com Sam Ferris sam.ferris@hgcapital.com Cadarn Lucy Clark lucy@cadarncapital.com +44 (0)7984 184 461 David Harris david@cadarncapital.com +44 (0)7368 883 211 Notes: 1. Please be advised that this announcement contains inside information as stipulated under the Market Abuse Regulation (EU) No. 596/2014 as amended by The Market Abuse (Amendment) (EU Exit) Regulations 2019. 2. This announcement may include "forward-looking statements". These forward-looking statements are statements regarding the Company's objectives, intentions, beliefs or current expectations with respect to, amongst other things, the Company's financial position, business strategy, results of operations, liquidity, prospects and growth. Forward-looking statements are subject to risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Accordingly, the Company's actual future financial results, operational performance and
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achievements may differ materially from those expressed in, or implied by, the statements. Given these uncertainties, prospective investors are cautioned not to place any undue reliance on such forward-looking statements, which speak only as at the date of this announcement. The Company expressly disclaims any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect actual results or any change in the Company's expectations with regard to them or any change in events, conditions or circumstances on which any such statements are based unless required to do so by the Financial Services and Markets Act 2000, the Listing Rules or Prospectus Regulation Rules of the Financial Conduct Authority or other applicable laws, regulations or rules. 3. Past performance is not a reliable indicator of future results. The value of shares and the income from them can go down as well as up as a result of market and currency fluctuations. You may not get back the amount you invest. About HgCapital Trust plc HgCapital Trust plc is an investment company whose shares are listed on the London Stock Exchange (HGT.L). HgT gives investors exposure, through a liquid vehicle, to a portfolio of high-growth unquoted companies, managed by Hg, an experienced and well-resourced private equity firm with a long-term track record of delivering superior risk-adjusted returns for its investors. Further information on HgT including a short introduction video is available here: https://www.hgcapitaltrust.com/ LEI: 213800J7QUJJBEFSIN38