Thorney Technologies reported a sharply reduced half-year profit amid challenging market conditions but extended its share buyback to support shareholder value.
- Half-year net profit after tax down 83% to $1.59 million
- Net tangible asset backing stable at 25.8 cents per share
- On-market share buyback program extended to November 2026
- Portfolio focused on listed and unlisted tech and healthcare companies
- No performance fee payable as high water mark not exceeded
Market Context and Financial Performance
Thorney Technologies Ltd (ASX: TEK) has released its half-year financial results for the period ending 31 December 2025, revealing a net profit after tax of $1.59 million. This represents a significant 83% decline compared to the prior corresponding period, underscoring the impact of ongoing macroeconomic and geopolitical headwinds on investment returns.
Despite the profit contraction, the company’s net tangible asset (NTA) backing per share remained largely stable at 25.8 cents after tax, reflecting a resilient portfolio amidst volatile equity markets. The company did not declare any dividends for the period, maintaining a cautious capital management stance.
Portfolio Strategy Amid Volatility
The Chairman’s letter highlights a challenging investment environment characterised by inflationary pressures, uneven global growth, and geopolitical tensions that have dampened business confidence and constrained capital flows. Within this context, Thorney Technologies has maintained a disciplined approach, focusing on profitable, cash-generative companies with strong balance sheets, while early-stage and pre-profit businesses faced funding constraints and valuation pressures.
The portfolio continues to concentrate on innovative and scalable businesses across sectors such as healthcare, industrial technology, software, and data services. Key holdings include Calix Limited, Clarity Pharmaceuticals, Credit Clear Limited, Imricor Medical Systems, Mesoblast Limited, DUG Technology Limited, and Yojee Limited. The company has also been simplifying its portfolio composition to enhance focus and manage risk.
Private Markets and Valuation Challenges
Conditions in private capital markets remained difficult, with early-stage and unlisted companies experiencing tougher capital raising environments. Valuations in private markets have been pressured by higher funding costs and reduced risk appetite, leading to flat or discounted funding rounds. Liquidity events such as IPOs and trade sales were limited, reflecting broader market volatility and valuation compression.
Thorney Technologies emphasises that these valuation adjustments often reflect short-term liquidity dynamics rather than fundamental impairments, and expects embedded value to materialise over time as market conditions normalise.
Capital Management and Share Buyback
In response to the persistent discount between its share price and underlying NTA, the Board has extended the on-market share buyback program until 13 November 2026. This initiative aims to enhance NTA per share, provide liquidity support during market dislocations, and demonstrate confidence in the portfolio’s long-term prospects. The Thorney Investment Group remains a substantial shareholder with approximately 31% ownership, ensuring alignment with other shareholders.
Outlook
Looking forward, Thorney Technologies anticipates continued macroeconomic and geopolitical uncertainty but sees opportunity in market volatility for active investors with capital and patience. The company plans to continue streamlining its portfolio, supporting strategic execution within holdings, and pursuing attractive entry points created by market dislocations, while addressing the share price to NTA discount through prudent capital management.
Bottom Line?
Thorney Technologies’ cautious yet confident approach positions it to capitalise on market dislocations, but investors will watch closely how portfolio simplification and buyback execution unfold.
Questions in the middle?
- How will ongoing macroeconomic uncertainties impact the valuation and performance of Thorney’s unlisted investments?
- What is the timeline and scale expected for the on-market share buyback to meaningfully reduce the share price discount?
- Will the company’s portfolio simplification lead to divestments or new strategic investments in the near term?