Pomegranate Investment AB (publ) - Financial Report for the period of 6 months ended October 31, 2018 and second quarter ended October 31, 2018
NOT FOR DISTRIBUTION IN THE UNITED STATES OR TO ANY U.S. PERSON
Highlight of the reporting period
- Net result for the period Maj 1 – October 31, 2018 was EUR -28.6 million (mln) (May 1, 2017 - October 31, 2017: EUR 1.5 mln). Earnings per share were EUR
- The net asset value of the Company was EUR 102.8 mln on October 31, 2018, (April 30, 2018: 131.4), corresponding to EUR 19.0 per share, (April 30, 2018: 24.3).
- The Company’s net asset value per share in EUR decreased by 21.7% over the period May 1, 2018– October 31, 2018, related to currency effect from EUR translation of underlying IRR values of recent transactions and other established IRR valuations in portfolio companies. The IRR valuation of two of our holdings have been upgraded, namely Sheypoor - our second largest portfolio company and our fast growing spoken word company - Navaar. The former continues to grow strongly with much reduced cash burn and the latter is reaching break-even levels.
- Thanks to improved clarity of FX environment in Iran, for NAV calculation purposes, we have moved from risk adjusted CBI rates in the last two quarters, to data from the new foreign exchange trading platform locally known as “NIMA” for all relevant translations between IRR and EUR. This substantially improves the quality of our FX translated data again.
- The final tranche of EUR 3.8 million related to Sarava’s February 2018 fundraising was transferred in August 2018.
- At the Company’s AGM on September 6, 2018, the shareholders resolved on introduction of new long-term incentive program for management as well as Board of Directors. About half of the warrants granted under the previous system will expire shortly and the proposed LTIP 2018 is therefore a necessary step in order to keep the current management and Board of Pomegranate Investment AB (publ) motivated and to deliver on the long-term strategy of the company, more information can be found in Note 4.
- Cash and cash equivalents amounted to EUR 17.7 million as per October 31, 2018 (April 30, 2018: 23.4). Additionally, the Company had short term investments with Griffon Capital at a value of ca EUR 1.9 million as per October 31, 2018. Which means a total sum of cash and short term investments of EUR 19.7 million.
Events after the end of the reporting period
- All documents related to the exercise of the first tranche of Sheypoor stock options held by Pomegranate were finalized with an updated investment agreement for a total consideration of EUR 550 thousand in exchange for 3.03% in the company.
Florian Hellmich, CEO of Pomegranate Investment AB (publ), commented:
While adaptation to a new economic reality is always painful, underlying growth of our portfolio companies continues, as also evidenced by the upgrade of the valuation of two of our companies. At the same time the shift towards online businesses persists overall locally (KPI evidence across the board) therefore also job creations in the ecosystem. Macroeconomic turbulence has continued while there are some recent encouraging signs, e.g. from the improved local FX mechanism visibility and stabilisation of FX rates. We are well equipped, capital and know-how wise to continue to build together with our partners, have healthy cash balances across our businesses to fill a void of (international) competition.
For additional information, please visit the Company’s website at www.pomegranateinvestment.comor contact:
Investor Relations contact:
Gustav Wetterling, CFO
Tel: +46 8 545 015 50
Pomegranate Investment AB (publ) is based in Sweden and was founded in 2014 by a pioneering team with a long and successful track record of investing in high growth companies in emerging markets, particularly in the technology sector. Pomegranate is an investment company that has a strong position primarily in Iran’s consumer technology sector, which, with the easing of international sanctions, represents an extraordinary growth opportunity for European investors. We are entrepreneurs, we have invested in entrepreneurs and a significant proportion of our investors are entrepreneurs themselves.
This press release does not constitute an offer of any securities of Pomegranate Investment. This press release may not be distributed in the United States or to any “U.S. person”, including any U.S. citizen or permanent resident (‘green card holder’) or any entity organised in the United States, whether located inside or outside the United States. Pomegranate shares represent an investment in Iran that is not suitable for U.S. persons.