Fund manager 360 Capital Group Ltd (ASX: TGP) today says it expects earnings to double in FY21, as the company aims to scale up its private equity business and expand its businesses across the investment strategies. The 360 Capital share price rose by 2.5% to 82 cents after the announcement.
What else was said by 360 Capital today?
360 Capital is forecasting a distribution of 4 cents per share in FY21. As such, the company expects its earnings per share (EPS) to be above 4 cents, but more clarity around these figures will be announced in its half year FY21 results in February 2021.
The company says its focus in FY21 is to continue to scale each of the funds under its management, and to start getting efficiencies from scaling up the platform.
360 Capital says its balance sheet remains in a strong (but inefficient) position with approximately $80 million in cash and no debt. The company aims to scale up investments on this free cash going forward, which it hopes will boost its earnings in FY21.
What is 360 Capital and what does it own?
360 Capital was established in 2006 by current chief executive, Tony Pitt. The company is a funds manager that invests in ASX-listed companies as well as private companies under its private equity business. The company has built its investment strategy around four key assets: real assets, private equity, public equity, and credit.
Some of the company’s achievements in the past have been the $300 million listing of Centuria Industrial REIT (ASX: CIP) in 2012, the $45 million initial public offering (IPO) of 360 Capital REIT (ASX: TOT) in 2015, and its own $71 million backdoor listing of 360 Capital Group via Trafalgar Corporate Limited in 2013.
In its private equity business, the company currently owns stakes in four different companies. One of them is in a private company that owns a 19.55% stake in the E&P Financial Group Ltd (ASX: EP1).
Earlier this month, 360 Capital announced in a letter to shareholders that it sought to explain why it has acquired 19.55% of E&P, and why it has made a conditional offer to acquire the remaining shares with the intention of taking E&P private.
In that letter, 360 Capital argues that E&P should be privatised because it would give it greater flexibility to manage its capital base, and respond faster to opportunities by removing the complexities associated with public listing. Those discussions are still ongoing.
How has the 360 Capital share price performed in 2020?
The 360 Capital share price has been one of the casualties of the 2020 pandemic, as its listed property investments were hit hard. The share price has lost more than 24% in 2020 and, at the current price of 82 cents, the company has a market capitalisation of $185 million.
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