Investcorp announced operating earnings for the six months of 2002 of $23.5 million, an increase of 28 percent over the same period last year. Net income after provisions was $13.2 million, compared to $1.6 million for the first six months of 2001. Operating earnings in the second quarter of 2002 were $46.9 million, compared to a marginal loss of $400,000 for the same period last year.
The large size and cyclical nature of transactional revenue is an important consideration for investors when evaluating Investcorp's performance, which can only be judged an on annual basis. Investcorp's half-year results are in strong contrast to the firm's results for the first quarter of 2002, reflecting how, due to the transactional nature of private equity investing, its net income can fluctuate from quarter to quarter in a way that is not indicative of annual performance.
Investcorp's corporate investment line of business has been active in the second quarter of 2002, reaching an agreement with the Board of Directors of a US company in May to acquire the company. Benefiting from the strong operating performance of Neptune, a recent acquisition, Investcorp also successfully arranged a part refinancing of Neptune's preferred pay-in-kind debt with lower-cost bank financing.
The Investcorp Asset Management Program has continued to perform well, providing positive returns well over LIBOR for Investcorp and its clients, in an environment where every traditional bond and equity index is trading at near five year lows.
The real estate line of business has been very active, taking advantage of the favorable interest rate environment and the adjustment of urban property pricing in the US to acquire a number of properties. In the first six months of 2002, the real estate team has sold two properties and acquired 10 new properties including .
Investcorp's fourth, and most recent line of business, Technology Investment (TI) achieved significantly with the exit of Acta at a value of almost two times the original purchase price. This investment was made through the $210 million Technology Fund that the TI team manages on behalf of clients and Investcorp. The team also completed a second capital call for the Fund and made two new investments in established later-stage technology ventures in the US.
Investcorp is a global investment group with offices in Bahrain, London and New York. The firm is involved in corporate investment, real estate investment, asset management and technology investment. It was established in 1982 and has since completed transactions with an aggregate value of approximately $20 billion. — (menareport.com)
© 2002 Mena Report (www.menareport.com)
