3i Group (LON:III) Releases Earnings Results

3i Group (LON:III) released its quarterly earnings data on Thursday. The company reported GBX 160 earnings per share for the quarter, Digital Look Earnings reports. 3i Group had a return on equity of 17.91% and a net margin of 94.84%.

Here are the key takeaways from 3i Group’s conference call:

• 3i delivered a 5% total return for the half, ending September with NAV per share of £31.54 after paying a 48p dividend. Portfolio value growth added 186p per share, while foreign-exchange movements reduced NAV by 47p.
• Action reported nine-month sales growth of 13.6% and operating EBITDA growth of 10.7%; like-for-like sales rose 3.4%, mainly driven by transactions. Management expects at least 400 store openings, around 4% like-for-like growth and a 14.7%–14.8% EBITDA margin for the year, subject to no material trading disruption.
• Management described the broader portfolio as resilient: 96% of private-equity holdings by value grew earnings, with no material write-downs, and infrastructure delivered a 13% gross investment return. The company also said most private-equity value growth came from Action.
• Action’s third-quarter EBITDA margin was pressured by weaker-than-expected sales, higher shrink and staff absenteeism. Management said October margins moved above 15% and expects a material step-up in the fourth quarter, but that recovery remains an outlook.
• After completing a £750 million share buyback at an average price of £24.95, 3i announced a second programme of up to £750 million through May 2027. Management said it believes the shares trade below the portfolio’s fundamental value and expects cash generation to support the buyback alongside a progressive dividend policy.

3i Group Stock Performance

LON III traded down GBX 81.50 during mid-day trading on Friday, reaching GBX 2,628.50. 642,035,313 shares of the stock were exchanged, compared to its average volume of 27,909,275. The business’s 50 day moving average is GBX 2,539.52 and its 200-day moving average is GBX 2,683.44. 3i Group has a 1 year low of GBX 1,825 and a 1 year high of GBX 3,626. The company has a market capitalization of £26.65 billion, a P/E ratio of 4.88, a P/E/G ratio of -0.35 and a beta of 1.63. The company has a debt-to-equity ratio of 4.08, a quick ratio of 0.09 and a current ratio of 131.80.

Insider Buying and Selling

In other news, insider Simon Borrows purchased 37,600 shares of the company’s stock in a transaction that occurred on Thursday, November 12th. The shares were bought at an average price of GBX 2,674 per share, for a total transaction of £1,005,424. Corporate insiders own 2.13% of the company’s stock.

3i Group declared that its board has initiated a stock repurchase plan on Thursday, November 12th that permits the company to repurchase £750 million in shares. This repurchase authorization permits the company to reacquire up to 2.9% of its stock through open market purchases. Stock repurchase plans are usually an indication that the company’s board believes its stock is undervalued.

About 3i Group

3i is an investment company specialising in Private Equity and Infrastructure. We invest in mid-market companies headquartered in Europe and North America. We generate attractive returns for our shareholders and co-investors by investing in private equity and infrastructure assets. As proprietary capital investors we have a long-term, responsible approach. We aim to compound value through thoughtful origination, disciplined investment and active management of our assets, driving sustainable growth in our investment companies.