TIP Group’s Shares Trade 36% Below NAV Despite Strong 1H25 Results
Teaminvest Private Group Limited (TIP) reported a robust 21% rise in statutory NPAT for 1H25, alongside a 1.5 cent interim dividend and ongoing share buy-back, underscoring confidence in its undervalued shares.
- Statutory NPAT increased 21% to $2.5 million in 1H25
- Look-Through EBITDA grew 12% to $8.9 million
- Interim dividend of 1.5 cents per share declared
- MOIC for direct investments reached 2.9x
- Share buy-back continues amid 36% discount to net asset backing
Strong Financial Performance in 1H25
Teaminvest Private Group Limited (TIP) has delivered a solid financial performance for the half-year ended 31 December 2024, reporting a 21% increase in statutory net profit after tax (NPAT) to $2.5 million. Operating NPAT also rose by 12% to $2.6 million, reflecting the company’s ability to convert prior investments into tangible earnings growth.
Look-Through EBITDA, a key measure of underlying profitability, grew by 12% to $8.9 million, signaling robust operational momentum across TIP’s portfolio. This growth was underpinned by strong returns from all three flagship funds, each outperforming their respective benchmarks, which highlights the firm’s effective investment strategy and asset management capabilities.
Investment Returns and Portfolio Highlights
TIP’s equity division continues to demonstrate impressive capital efficiency, with a Money On Invested Capital (MOIC) multiple of 2.9x across its direct investments. Notably, investments such as GLT and ECT have achieved MOICs of 6.6x and 4.7x respectively, while newer investments like MMT and the Corinthian Fund show promising multiples of 3.4x and 13.2x.
Colour Capital, a 33% owned associate, secured a $20 million judgment plus costs during the half, though this has not yet been reflected in TIP’s financial results. This legal win could potentially enhance TIP’s future earnings and asset base, adding another layer of upside to the investment portfolio.
Capital Management and Shareholder Returns
TIP declared an interim dividend of 1.5 cents per share, maintaining a shareholder-friendly approach amid ongoing growth investments. The company also invested $2.0 million in new growth initiatives during the half, signaling confidence in future compounding returns from these ventures.
Importantly, TIP continues its share buy-back program, motivated by the belief that its shares are significantly undervalued. Trading at a 36% discount to net asset backing and an 82% discount to the ASX Small Ords on an EV/EBITDA basis, the buy-back aims to enhance shareholder value and market perception.
Looking Ahead
With net assets per share rising 2.6% to $3.18 after dividends and buy-backs, TIP appears well-positioned to leverage its strong balance sheet and investment pipeline. CEO Andrew Coleman’s leadership will be critical in navigating the next phase of growth, particularly in realising the potential of recent investments and the Colour Capital judgment.
Overall, TIP’s 1H25 results reflect a company in growth mode, balancing disciplined capital deployment with shareholder returns and strategic buy-backs. Investors will be watching closely to see how these elements translate into sustained value creation in the coming periods.
Bottom Line?
TIP’s confident growth and buy-back strategy set the stage for a pivotal second half of FY25.
Questions in the middle?
- When will the $20 million Colour Capital judgment be recognised in TIP’s financials?
- How will recent growth investments impact TIP’s earnings trajectory beyond 1H25?
- What is the expected timeline and scale for the continuation of the share buy-back program?
