Gresham House Annual Review

for the year to 31 December 2023

Gresham House Annual Review 2023

📈 AUM increase to £8.5bn and GH30 plan for long-term growth

We are pleased to announce a transformational year in 2023, delivering strong financial returns for clients and a growing suite of sustainable investment solutions, alongside new ownership to support long-term growth.

The acquisition by funds advised by Searchlight Capital Partners, L.P. (Searchlight) in December 2023 heralds a new phase of development, with the announcement of the new “GH30” strategic plan aligning management and employees with clients. GH30 targets £20 billion in Assets Under Management (AUM) and EBITDA of £90 million by 2030, among other goals supporting scale and innovation for the benefit of clients.

In 2023, AUM grew organically by 8% to £8.5bn as at 31 December 2023, raising £0.7bn across all divisions, and Adjusted EBITDA¹ grew to £36.0mn with an Adjusted EBITDA1 margin of 42.6%, which represents the performance of the Group as an unlisted company. Return on Capital Employed (ROCE) also increased to 24.9%, above the medium-term target of 20.0%.

An introduction to our 2023 results

In this short video Tony Dalwood, CEO, talks through our 2023 annual results and explains why 2023 was a strong year for Gresham House.

Highlights

Highlights included the Sustainable Infrastructure fund BSIF II and co-investment vehicles final close of c.£450mn, the launch of the Private Equity Release Fund LP with commitments of over £50mn and net fund inflows of c.£200mn in Public Equity funds as the business continues to win new business, bucking the wider trend of outflows in the UK small-cap sector.

Gresham House has continued to deliver robust returns for investors in 2023, with the majority of products outperforming relative to comparator benchmarks or stated target returns. The Real Assets strategies additionally offered lower volatility and resilience against rising inflation and interest rates.

The company plans to evolve its offering in 2024 and beyond with developments across Sustainable Infrastructure, Natural Capital, and internationally, leveraging its strengths for a growing and increasingly diverse investor base.

The Sustainable Infrastructure team continues to raise new capital and create more local and sector focused co-investment vehicles and direct investments. It is also assessing new vehicles for the defined contribution pensions and insurance markets to fund the defined pipeline of opportunities both within its existing 12 platform businesses, as well as in new Sustainable Infrastructure assets.

Gresham House is also at the forefront of the nascent Natural Capital investment sector. The Gresham House platform offers a suite of Natural Capital investment solutions predicated on the Group’s expertise and experience in sustainable forestry, and emerging asset classes within the Sustainable Infrastructure strategy, such as Biodiversity Net Gain ‘habitat banks’ and sustainable agriculture in the form of vertical farming.

1. The Company’s Adjusted EBITDA is calculated after removing the cost of being a listed company.

Commenting on the review, Chief Executive, Tony Dalwood said:

“We are excited to see continued momentum into 2024 with a well-defined strategy and a clear path to growth across all our asset classes. It is particularly pleasing to see the recent £50 million fundraise for the Baronsmead VCTs oversubscribed and to see continued flows into our UK equity funds. We are also seeing increased investor interest in our Housing investments, whilst developing further breadth and depth in our client base as we demonstrate our international credentials and our long-term alignment with clients who seek strong financial returns.

We remain ambitious and confident that Gresham House will continue to drive the delivery of its financial and strategic goals with an unwavering focus on investment performance combined with sustainability targets to align with our clients’ ambitions.”