Forward Partners Group PLC (AIM:FWD), an investment firm that focuses on high-growth, early-stage technology businesses, said it expects a decline in the net asset value of its Ventures Portfolio Value in the half-year to end-June due to the fall in high-growth technology stocks.
The firm also said it plans a managed wind down of its Forward Advances subsidiary, which was set up in 2020 to meet the demand of the fast-growing alternative funding market, because the current macroeconomic environment leaves "limited opportunities for future growth".
The company said it expects Ventures Portfolio Value to be no less than £92.0mln, including £6.3mln in new investments, as at 30 June 2022, representing a decline of 26.4% excluding the new investments.
NAV per share is expected to be not less than 83.4 pence of which cash is expected to be 16.8 pence, it added. NAV per share is down 20% from 104.1p a year ago.
Forward Partners noted that the performance of the underlying portfolio remains strong, with average forecast revenue growth by fair value of 40%-60% for the Top 15 portfolio investments for the full year.
It said over 80% of the Top 15 portfolio investments are anticipated to be on the path to break even without the need for fundraising in the near future.
Forward Advances, which is slated for a wind down, generated revenues of £366,000 and recorded losses after tax of £1.1mln in 2021, with total originations of £9.5mln.
The Advances book value at 30 June 2022 is expected to be £1.9mln.
The company said the capital conserved following the wind down will be used to support Ventures in investing into new technology businesses with strong fundamentals and existing portfolio companies.
"Our forecasts show that a managed wind down of Advances will reduce operating costs and, over time, strengthen the group's balance sheet," it said.