Augmentum Fintech posts £1m loss amid “significant market volatility”
Augmentum Fintech has posted a £1m pre-tax loss for the six months ended 30 September 2022, compared to a profit of £30.5m at the same point last year.
The London-listed fintech fund, which has a stake in former peer-to-peer lender Zopa, also reported a decline in net asset value (NAV) to £292.1m compared to £295.2m in 31 March 2022.
The firm said that 195,000 shares have been bought back since September, at an average price of 89.7p per share, representing an average discount to the updated NAV after performance fee at 30 September 2022 of 42.1 per cent. NAV per share after performance fee remained stable across the period at 155.0p.
The firm reported available cash at period end of £57.1m with no debt.
Read more: Augmentum Fintech raises £55m through “oversubscribed” share issue
Augmentum said that Zopa, which is the company’s third largest holding, now has more than 800,000 customers and revenue growth this year was sustained at more than 150 per cent, with the business cash generative for the first time.
“In the face of significant market volatility and economic uncertainty over the half year, the NAV per share held firm”, said Neil England, chairman of Augmentum Fintech.
“The negative impact on valuations from the contraction of multiples in comparable businesses was largely offset by strong revenue growth in several of the portfolio companies and an FX benefit from non-sterling holdings.”
England added that it was “frustrating” that the firm’s share price was hit hard by the rotation of market sentiment and said that sentiment towards the technology sector would likely “remain subdued for some time yet”.
Read more: Zopa looks to raise another $100m ahead of IPO
Augmentum Fintech chief executive Tim Levene admitted that market uncertainly had come to characterise his updates for some time.
However, he added: “Our bar for investment remains high, while the consistency, discipline and prudence in our valuation approach has protected our positions from the price volatility we have seen in public tech stocks over the past 12 months.
“Despite the current macroeconomic challenges, we remain very positive about fintech’s future potential. The industry will continue to eliminate friction, improve user experiences, broaden access and reduce costs. We are only part way through the first phase of the story.”
Read more: Augmentum Fintech awaiting ‘price correction’ to boost portfolio
