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Introduction
3i Group plc (LON:III) reported its Q3 FY2025 results for the period ended 31 December 2024. The update emphasized growth in NAV, resilient portfolio performance, and strategic capital allocation, alongside challenges in select sectors.
Key Highlights
- Financial Performance
- NAV per share rose to 2,457 pence (vs. 2,261 pence at 30 September 2024), delivering a total return of 20% over nine months.
- Negative foreign exchange impact: £476 million loss (49 pence per share).
- Action’s Outstanding Results
- Net sales surged 22% to €13.8 billion (2023: €11.3 billion); operating EBITDA jumped 29% to €2.1 billion.
- 10.3% LFL sales growth (2023: 16.7%) and 352 net new stores opened (total: 2,918 stores).
- Dividend of £215 million paid to 3i; year-end cash balance: €814 million.
- Debt refinancing: 40% of senior debt restructured, saving €14 million annually and extending maturities.
- Valuation: £17.1 billion for 3i’s 57.9% stake (unchanged 18.5x multiple on run-rate EBITDA).
- Private Equity Portfolio
- Resilient performance in consumer/private label companies (e.g., Royal Sanders, MPM, Audley Travel).
- Challenges:
- WilsonHCG (recruitment) and BoConcept (discretionary retail) underperformed due to weak markets.
- £76 million total value reduction for WilsonHCG year-to-date.
- New Investments:
- £121 million in WaterWipes (completed January 2025).
- Four bolt-on acquisitions (e.g., Evernex’s purchase of Ultra Support).
- Realisations:
- £280 million from WP sale (18% premium to March 2024 valuation).
- Infrastructure
- 3i Infrastructure plc (3iN) share price fell 7% to 317 pence, valuing 3i’s 29% stake at £853 million.
- Scandlines maintained stable freight/leisure volumes; £7 million dividend received.
- Balance Sheet & Liquidity
- Gross cash: £792 million; undrawn credit facility: £900 million.
- Gearing reduced to 2% (vs. 4% in September 2024).
- Foreign exchange sensitivity: 1% euro movement impacts NAV by £173 million.
Conclusion
3i Group highlighted strong operational execution in Q3 FY2025, driven by Action’s growth and disciplined portfolio management. While macroeconomic uncertainties persist, the group’s robust liquidity and diversified investments position it to navigate challenges. Further updates on Action’s 2025 outlook are expected at its Capital Markets Seminar in March 2025.
