Tekcapital reports full-year turnaround, shares pop

(Sharecast News) - Tekcapital reported a sharp turnaround in its financial performance on Friday, posting a profit after tax of $19.2m for 2024, compared with a loss of $15.7m the prior year. The AIM-traded intellectual property investment group attributed the improvement to increased portfolio valuations and lower expenses, with administrative costs down 26% to $2m.

Net assets rose 46% to $70.1m, while portfolio valuation increased nearly 50% to $61.5m, driving the net asset value per share up 22% to 33 cents.

The year saw two portfolio companies - MicroSalt and GenIP - successfully listed on AIM, crystallising a combined $18.3m in value.

Four of Tekcapital's five portfolio companies were now publicly traded, with Guident preparing for a Nasdaq initial public offering in 2025.

Across the portfolio, businesses made significant commercial progress, including new contracts, strategic partnerships, and product launches.

MicroSalt secured recurring B2B orders from a global food manufacturer, while Innovative Eyewear expanded retail distribution.

GenIP entered the Saudi market and signed agreements across several regions, and Belluscura gained Medicare reimbursement eligibility in the US.

Tekcapital's share price rose 27% during the year, outperforming the AIM All-Share Index and its UK-listed IP commercialisation peers.

The company highlighted its relatively low operating cost base and its belief that the current 66% share price discount to net asset value was unjustified.

With a strengthened balance sheet, ongoing portfolio momentum, and plans to invest in generative AI technologies, Tekcapital said it was well-positioned for further growth and value creation in 2025.

"We are excited to provide this 2024 summary report which describes a few of our portfolio company achievements and their contribution to our profitability and growth," said executive chairman Dr Clifford Gross.

"In 2024 our net assets reached $70.1m, an increase of around 46%, over the previous year, an annual record since the company's inception.

"Net asset value per share was 33 cents."

Dr Gross said the firm's performance reflected strong commercial progress through the completion of two AIM listings - MicroSalt and GenIP - and as a result, four of its five portfolio companies were now listed.

"Additionally, we observed significant commercial traction for Innovative Eyewear as they achieved several new product and go-to-market milestones.

"We were also pleased to note MicroSalt has received new and follow-on B2B orders from a major snack food manufacturer.

"Further, we believe that Guident's commercial advancements, coupled with improving performance and market traction in the autonomous vehicle industry, have created a fertile opportunity for Tekcapital to potentially further crystallise its balance sheet in 2025."

Tekcapital believed that its success in 2024 was "a testament to its portfolio companies' strategic positioning and relevance", Clifford Gross added.

"Our core long-term financial objective is to grow net assets and returns on invested capital.

"Once material levels of capital are monetized from our portfolio companies, we will seek to provide a special dividend.

"We remain committed to this long-term objective, and our portfolio companies' progress in 2024 is a good step in that direction."

At 1328 BST, shares in Tekcapital were up 18.62% at 9.49p.

Reporting by Josh White for Sharecast.com.