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UNIVERSAL PARTNERS LIMITED - Summarised unaudited results for the three and nine months ended 31 March 2022

Release Date: 11/05/2022 08:53
Code(s): UPL     PDF:  
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Summarised unaudited results for the three and nine months ended 31 March 2022

UNIVERSAL PARTNERS LIMITED
(Incorporated in the Republic of Mauritius)
(Registration number: 138035 C1/GBL)
SEM share code: UPL.N0000
JSE share code: UPL
ISIN: MU0526N00007
("Universal Partners", "UPL" or "the Company")


SHORT FORM ANNOUNCEMENT: SUMMARISED UNAUDITED FINANCIAL STATEMENTS FOR THE QUARTER AND NINE MONTHS
ENDED 31 MARCH 2022

                                                  Quarter           Quarter      Nine months       Nine months
                                                    ended             ended            ended             ended       Year ended
                                                 31 March          31 March         31 March          31 March          30 June
                                                     2022              2021             2022              2021             2021
 Net asset value per share       GBP                1.458             1.059            1.458             1.059            1.453
 (“NAV”) **
 Profit / (loss) for the quarter GBP            5 955 367          (570 846)      15 471 249        (2 574 822)      25 897 867
 / year
 Earnings / (loss) per share     pence               8.18             (0.79)           21.32             (3.56)           35.80
 Headline earnings / (loss) per  pence               8.18             (0.79)           21.32             (3.56)           35.80
 share
 ** The NAV per share as at 31 March 2022 was GBP 1.458 (30 June 2021: GBP 1.453), post payment of the dividend of GBP
 0.207 per share in November 2021

Universal Partners has a primary listing on the Official Market of the Stock Exchange of Mauritius Ltd ("SEM") and a secondary
listing on the Alternative Exchange of the JSE Limited ("JSE").

The principal activity of the Company is to hold investments in high quality, growth businesses across Europe, with a focus on the
United Kingdom ("UK"). The Company's investment mandate also allows up to 20% of total funds at the time an investment is
made to be invested outside the UK and Europe.

The Company's primary objective is to achieve strong capital appreciation in Pounds Sterling ("GBP") over the medium to long-
term by investing in businesses that meet the investment criteria set out in the Company's investment policy.

In its ordinary course of business, the Company continually assesses various opportunities for new acquisitions as well as disposals
of assets in its portfolio.

MANDATORY OFFER TO SHAREHOLDERS

With reference to the announcements released by the Company on the SEM's website and the Stock Exchange News Service of
the JSE on Friday 29 April 2022 and Friday 6 May 2022, an Offer Document, which sets out the mandatory offer (the "offer") by
Glenrock Lux PE No1 SCSp and Glenrock Lux PE No2 SCSp ("Glenrock") to acquire UPL shares not currently held by Glenrock, was
posted to UPL shareholders on Friday 6 May 2022. The board of directors (the "Board") of UPL will distribute a reply document on
or around 24 May 2022, in order to enable shareholders to reach an informed decision about the offer.

BUSINESS REVIEW

Since its listing on the SEM and the JSE, the Company has worked closely with its investment advisor, Argo Investment Managers
("Argo"), to identify potential investments that meet its investment criteria.

An update on investments held at the reporting date is presented below.

Dentex Healthcare Group Limited ("Dentex")
www.dentexhealth.co.uk

Dentex is a dental consolidation group focusing on acquiring dental practices in the UK. Dentex completed the acquisition of its
123rd practice in April 2022, representing an increase of 13 practices since the previous quarterly results announcement. Around
85% of Dentex revenue is generated from the private market, with the balance delivered from NHS services. Dentex is the second
largest private market focused dental corporate in the UK and is currently the only dental corporate that partners with dentists
by offering them equity in the holding company.

Dentex traded ahead of budget in respect of the current financial year which ended on 31 March 2022, as demand for private
dentistry remains high. Dentex benefits from a well invested central partner support function and has successfully acquired and
integrated 52 practices since November 2020. Dentex has a further 16 practices under signed heads of terms that are currently in
due diligence and has a significant pipeline of additional acquisition opportunities that it is evaluating.

The price at which Dentex issues shares to Dentists as part-payment for the purchase of their practices increased from GBP 2.10
to GBP 2.40 per share with effect from 31 March 2022. Accordingly, UPL has increased the valuation of Dentex to GBP 2.40 per
share, which has increased the overall value of the UPL holding in Dentex by GBP 7.5 million during the quarter, from GBP 52.1
million to GBP 59.6 million.

Dentex is currently working with third party advisors to evaluate various strategic options to support the continued growth of the
business.

Workwell (“WW”) formerly JSA Services Limited (“JSA”)
www.workwellsolutions.com

Workwell is one of the fastest-growing contractor accountancy and payroll solutions companies in the UK. Their services are
designed to meet the unique needs of contractors and freelancers, from one-person businesses to large employment agencies.
They also create bespoke solutions for temporary labour supply chains, helping their clients navigate the complexities of
contractor payroll and compliance.

The quarter to March 2022 saw continued growth in the number of contractors paid and the level of back-office services provided
to employment agencies. The acquisition of 6 Cats International at the end of January has provided a significant boost to the
international activities of WW and further growth is expected in this area. In line with industry trends, there was a decline in the
number of accounting services customers due to the ongoing effects of IR35 legislative changes, although there are early signs of
a return to growth in this sector. WW met its performance and profitability targets for the quarter and for its half year to March
2022.

Beyond the acquisition of 6 Cats International, there were no further acquisitions during the quarter, although discussions
continue with various potential target companies. After 6 months of detailed planning, the rebranding to Workwell was launched
in March and has been well received by clients and staff. Management is focusing on integrating the various companies in the
group and unlocking the synergies that exist between them.

SC Lowy Partners ("SC Lowy")
www.sclowy.com

SC Lowy Partners is a specialist financial group covering high yield and distressed debt market-making and investment
management, along with its Italian and South Korean banking subsidiaries.

The financial year to December 2021 produced record results for the company, driven by strong increases in fee and trading
income in the asset management business, combined with good performances from Choeun Savings Bank in Korea and Solution
Bank in Italy.

In the new financial year, the SC Lowy Primary Investments Fund continued to be negatively impacted by exposure to Chinese
debt securities. However, management remains confident that these positions will normalise and deliver improved returns in
future. In contrast, the Strategic Investments fund 1 continues to deliver excellent returns. The raising and deployment of funds
in Strategic Investments fund 2 are progressing well, and the company plans to launch an additional European-focused fund later
this year, depending on market conditions.

Despite the current turbulence in the Chinese debt securities market, SC Lowy believes that this market presents a significant long-
term opportunity and accordingly, has opened an office in Shenzhen to have a presence on the ground. Recent changes to Chinese
government policy to attract offshore capital should assist this strategy.

Xcede Group (Formerly Techstream Group) ("Xcede")
www.xcede.com

Xcede is a global recruitment specialist operating across the UK, Europe, North America, Africa and Asia. It specialises in the data
analytics, technology, cyber, digital, embedded software and energy sectors and assists clients with the placement of both
permanent and contractor candidates.

The business continues to deliver strong growth in profitability across all its core geographies as demand for specialist talent
remains high. The group is investing in further headcount to service its growing customer base and has made excellent progress
in the development of its global, central operating structures. Management has been focusing on cross selling the range of services
that Xcede offers to its extensive international client base. As part of this initiative, an internal business unit called Xcede Group
Solutions has been formed, with excellent results to date and strong prospects for the future. Xcede is evaluating options to
increase its funding lines in different jurisdictions to support the growth of its contractor business.

Propelair
www.propelair.com

Constructive progress has been made in this quarter, particularly in relation to the sale of units in the Middle East and South Africa,
where they have traded ahead of budget. However, the company is still significantly behind its original business plan.

During the quarter, Propelair concluded a successful capital raise whereby £3m of additional equity was invested to support
continued investment in the product and the distribution network. Due to the significant underperformance to date, UPL decided
not to participate in this capital raise. We continue to value this investment at a nominal £1.

FINANCIAL REVIEW

Interest income of GBP 90,393 for the quarter was mainly comprised of interest earned from the loan to Xcede.

Dividend income of GBP 155,620 relates to an accrual raised on the preferred shares subscribed for by Universal Partners in Xcede.

The Board is of the opinion that, at the end of the quarter under review, the valuations of WW, Xcede, SC Lowy and Propelair
should remain unchanged.

In accordance with the explanation above, UPL has increased the valuation of Dentex to GBP 2.40 per share, which has increased
the overall value of UPL's holding in Dentex by GBP 7.5 million, from GBP 52.1 million to GBP 59.6 million.

The Company's investment in SC Lowy is reflected at its original cost, which is denominated in US Dollars ("USD"). During the
quarter, the translation effect of exchange rate movements between the USD and the GBP resulted in a foreign exchange gain of
GBP 303,455.

Management fees accrued during the quarter amounted to GBP 513,737 incurred in terms of the investment management
agreement between the Company and Argo. General and administrative expenses amounting to GBP 88,004 were incurred. The
accrual for performance fees is calculated on the revaluation of the Company's investments. These fees, which are recalculated
quarterly, only become payable to Argo if the Company realises the expected profit on disposal of the investments. No
performance fees are payable to Argo until a successful exit of an investment has been achieved. During the quarter under review,
an additional performance fee accrual of GBP 1,168,653 was raised due to the increased valuation of Dentex.

The Company incurred interest of GBP 107,235 during the quarter on the RMB term loan facility.

Short-form announcement

This short-form announcement is the responsibility of the directors and is only a summary of the information in the full
announcement and accordingly does not contain full or complete details. The full announcement was published on SENS on 11
May 2022, and can be found on the Company’s website www.universalpartners.mu and can be accessed using the following JSE
link 

https://senspdf.jse.co.za/documents/2022/jse/isse/UPLE/HY21Result.pdf

Any investment decisions by shareholders and/or investors should be based on the full announcement released on SENS and
published on the Company's website.

Copies of this report are available to the public, free of charge, at the registered office of the Company, c/o Intercontinental Trust
Limited, Level 3 Alexander House, 35 Cybercity, Ebene 72201, Mauritius.

Copies of the statement of direct or indirect interest of the Senior Officers of the Company pursuant to rule 8(2)(m) of the
Securities (Disclosure of Obligations of Reporting Issuers) Rules 2007 are available to the public upon request to the Company
Secretary at the Registered Office of the Company at c/o Intercontinental Trust Limited, Level 3 Alexander House, 35 Cybercity,
Ebene 72201, Mauritius. The Board of Universal Partners accepts full responsibility for the accuracy of the information in this
communique.

A cash distribution of GBP 15 million (GBP 0.207 per share) in relation to the financial year ended 30 June 2021 was paid to
shareholders on 29 November 2021.

In line with the Company’s investment strategy to achieve long-term growth in NAV, dividends are not declared on a regular basis.
Accordingly, no dividend has been declared for the period under review.
DIRECTORATE CHANGES

Andrew Birrell resigned from the Board with effect from 31 March 2022 in order to devote more time to other interests. Andrew
joined Universal Partners at inception and, prior to his departure, represented the Company on the Workwell board. He also
represented Universal Partners on the board of Yasa at the time of the sale to Mercedes Benz. Pierre Joubert is an existing director
of Workwell and Justin Rodrigues has been appointed to the Workwell board in Andrew’s place. Pierre will assume the role as the
Company's representative in respect of SC Lowy.

The Board wishes to thank Andrew for his valuable contribution to the success of the Company during his tenure on the Board
and wishes him every success with his future endeavours.

The Board of Universal Partners accepts full responsibility for the accuracy of the information contained in this announcement.

By order of the Board
Mauritius – 11 May 2022


Company Secretary
Intercontinental Trust Limited


For further information please contact:

                                                  SEM authorised representative
            JSE sponsor                                   and sponsor                               Company Secretary
           Java Capital                                Perigeum Capital                        Intercontinental Trust Ltd
       Tel: +27 11 722 3050                          Tel: +230 402 0890                            Tel: +230 403 0800

Date: 11-05-2022 08:53:00
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