3i Group (LON:III) Announces Earnings Results

3i Group (LON:III) issued its quarterly earnings results on Thursday. The company reported GBX 160 EPS 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 Trading Down 3.0%

LON III traded down GBX 81.50 on Friday, reaching GBX 2,628.50. The stock had a trading volume of 642,035,313 shares, compared to its average volume of 27,909,275. The stock has a fifty day moving average price of GBX 2,539.52 and a two-hundred day moving average price of GBX 2,683.44. 3i Group has a 12-month low of GBX 1,825 and a 12-month high of GBX 3,626. The company has a quick ratio of 0.09, a current ratio of 131.80 and a debt-to-equity ratio of 4.08. The firm has a market capitalization of £26.65 billion, a price-to-earnings ratio of 4.88, a P/E/G ratio of -0.35 and a beta of 1.63.

3i Group announced that its Board of Directors has initiated a share repurchase plan on Thursday, November 12th that permits the company to buy back £750 million in outstanding shares. This repurchase authorization permits the company to buy up to 2.9% of its shares through open market purchases. Share repurchase plans are typically a sign that the company’s leadership believes its shares are undervalued.

Insider Activity at 3i Group

In related news, insider Simon Borrows bought 37,600 shares of the stock in a transaction that occurred on Thursday, November 12th. The stock was purchased at an average cost of GBX 2,674 per share, with a total value of £1,005,424. Insiders own 2.13% of the company’s stock.

3i Group Company Profile

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.