Pantheon International (PIN) Status update summary

Strategic Review and Portfolio Positioning

• Undertook a strategic review, narrowing manager relationships from 90 to 25 top-tier managers to enhance performance consistency and focusing on core managers and active capital management.

• Shifted to more consistent investment through cycles to diversify vintages and mitigate vintage risk.

• Adopted active use of the secondaries market to generate incremental liquidity, accepting more cash flow volatility for improved long-term performance.

• Maintained strong cash generation and liquidity, with a net cash position until 2024 and a recent move to a geared position.

• Increased focus on capital allocation, including significant share buybacks, cost reductions in debt and management fees, and ongoing asset sales.

Portfolio Performance and Market Environment

• Portfolio has shown resilience, tracking private equity benchmarks and outperforming public markets in stability, despite subdued returns since 2022.

• Valuation multiples have reset, with most impact from macro headwinds and multiple contraction already reflected in NAV; EV/EBITDA at 15x.

• Direct portfolio companies delivered 12% weighted average EBITDA growth and 13% revenue growth, with limited write-downs and significant uplifts at exit.

• Distribution rates have increased, with FY25 cash generation over three times FY24 and improved liquidity conditions.

• Portfolio is diversified across 500+ companies, with no single company exceeding 2% exposure.

Investment Themes and Sector Focus

• Technology and healthcare comprise over half of portfolio exposures, with a significant allocation to software and sector specialists.

• Emphasis on managers with proven ability to drive operational growth, sector, regional, and operational specialization, and recurring revenue models.

• AI and software market developments are closely monitored; software remains a core focus, but with a higher bar for new direct SaaS investments.

• Private credit market recalibration is noted, but with no direct exposure in the portfolio, limiting first-order impact.

• Limited direct exposure to Middle East risks; monitoring for broader macro and geopolitical effects.