HgCapital Trust (HGT) Q1 2026 earnings summary

Executive summary

• Q1 2026 saw resilient trading performance, but NAV per share declined 5.4% and share price fell 22.9% due to a sharp contraction in public software valuations, despite continued earnings growth and strong operational results across the portfolio.

• Net assets stood at £2.4 billion with a market capitalisation of £1.8 billion as of 31 March 2026.

• Portfolio companies, especially in mission-critical B2B technology and tech services, maintained high recurring revenues, low churn, and robust organic growth, supported by AI-driven innovation.

• AI integration is seen as an accelerant for portfolio companies, with over 1,600 live AI projects and 100+ AI-powered products launched.

• Recent exits and realisations, including Intelerad and Septeo, achieved significant uplifts to book value, demonstrating portfolio attractiveness even in volatile markets.

Financial highlights

• NAV per share at 31 March 2026 was 528.3p, down 5.4% from the previous quarter; share price at 388p, down 22.9%, in line with the IGV public software index.

• LTM revenue growth was 16% (10% organic), LTM EBITDA growth 19% (17% organic), and EBITDA margin 34% (all organic).

• Investments completed in Q1 totaled £42 million; realisations generated £91 million.

• Portfolio value was negatively impacted by a -9% movement in ratings, mainly from a 10% decline in software valuation multiples.

• Available liquid resources of £297 million (12% of NAV); outstanding commitments of £2.1 billion (88% of NAV).

Outlook and guidance

• Management remains focused on building AI-first champions in protected verticals, expecting agentic AI to materially expand the addressable market for software.

• Despite public market volatility, recent private transactions at uplifts to carrying value reinforce confidence in the portfolio's long-term value.

• Commitments expected to be drawn down over the next five to six years.