The value of TVC Holdings’ investment portfolio fell by €12 million in six months, led by the markdown of its investment in financial software firm Norkom.
The decline led to a loss before tax of €11.3 million and a 9 per cent reduction in equity value per share, the company said in an interim statement today.
At the end of September, the company had net assets of €91.8 million, comprising cash and government bonds of €31.5 million, quoted equity investments in Norkom and UTV of €49.1 million, and unquoted equity investments of €11.3 million.
Norkom Group saw a reduction in value of €15.5 million that reflected the fall in its share price from €1.55 to 91 cent, while UTV Media rose in value as its share price changed from £1.2125 to £1.35 during the period.
However, the company said it expected new opportunities to present themselves in the UK and Ireland in the next year.
“We believe that there will be significant restructuring opportunities in Ireland and the UK where trading companies with excessive debt will need to raise new equity at attractive prices for new investors,” executive chairman, Shane Reihill said.
“TVC’s management has extensive experience of complex turnaround transactions. We expect the number of restructuring opportunities to increase over the next 12 months as banks focus on problems within their trading clients.”
The company's optimism was supported by analysts, who said such transaction could help close the discount to book value, which is 41 per cent compared to equity value per share and 65 per cent excluding cash and government bonds.
"Given the group's strong financial position (net cash of over €31m) we see TVC as well placed to take advantage of such opportunities," Bloxham analyst Paraic Quinn said.
TVC sold its investment in APT Licensing Limited in July, which realised proceeds of up to €1.4 million.
:quality(70)/s3.amazonaws.com/arc-authors/irishtimes/850d265f-5198-4767-aa62-36b3b810588d.jpg)