Shares in investment company Tern PLC (LON:TERN) took a turn for the better after it unveiled a sharp increase in net asset value.
The shares of the company, which specialises in investing in companies in the Internet of Things (IoT) sector, surged 10.5% to 10.25p in early deals as it trumpeted a 560% uplift in net asset value during 2016.
A massive increase in the fair value of its investments – including its flagship investment, Device Authority – saw the company post a £5.3mln profit for the year, compared to a loss of £185,121 the year before.
Device Authority Limited, Push Technology Limited and Seal Software Group Limited were all revalued by referring to the prices paid in recent fund-raising activities by those companies, as per international financial reporting standards (IFRS); the unrealised gain on Device Authority Limited arose due to the acquisition of Device Authority Inc by Device Authority Limited (formerly Cryptosoft Limited).
In all, the value of the investments was bumped up by £5.76mln.
Meanwhile, Concerto was sold to Ingram Micro in November 2016 for US$500,000 with direct costs, including investment cost, of £98,811, resulting in a profit after all costs of £150,043.
Net assets at the end of 2016 stood at £11.19mln, up from £1.69mln at the end of 2015. Tern's market capitalisation currently stands at around £11.9mln.
"2016 was a pivotal year for Tern, with the company reaching several key business milestones whilst also undergoing significant, positive change. As a result, we enter the new year with a sharpened investment focus and a management team that has been realigned to play to its strengths,” said Al Sisto, chairman of Tern.
“Going forwards, we see a great deal of growth potential in our flagship investment, Device Authority, as well as the wider Internet of Things ecosystem, and I look forward to reporting progress on both fronts in the coming months,” he added.
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