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ICG Enterprise Trust

Mid-teens EBITDA growth and long-term returns

21 Oct 2025 / Corporate research

The key message from ICGT’s 1HFY’26 results (to July 2025) is the continued strength of the operating companies, which delivered, on average, 15% LTM EBITDA growth. Margins have widened by ca.5% (average revenue growth 10%), which should help allay some concerns over the impact of the challenging environment. New investment is forecast to accelerate, and realisation proceeds already exceed FY’25 with an average 14% uplift to carrying values on exit. A degree of short-term volatility is to be expected, and 1HFY’26 returns were below long-run averages, but the outlook is encouraging with visibility on exits and an “attractive” investment pipeline. 2Q was well ahead of 1Q. ICGT’s capital return policy is balanced.

  • 1HFY’26 numbers: ICGT’s constant-currency portfolio return was 2.1%, and the NAV per share total return -0.7%. A narrowing discount saw a share price return of 12.6%. Investee company saw LTM EBITDA growth of 15.2%. New investments totalled £113m and realisation proceeds were £222m already above FY’25.
  • Long term: Over five years, ICGT’s constant-currency CAGR portfolio return was 17.4%, and the NAV p/sh total return 14.5%. The return consistency generates compounding benefits. Shareholder return was 16.5% (narrower discount) and ICGT is one of ca.10% ITs that are “ISA-millionaire” investments.
  • Valuation: ICGT’s NAV valuations are conservative, demonstrated by continued realisations above reported book values. The ratings are undemanding. The 25% discount to NAV is anomalous, we believe, with defensive, market-beating returns, and well above the pre-COVID-19 levels. The 2026E yield is 2.5%.
  • Risks: PE is an above-average cost model, but post-expense returns have consistently beaten public markets. Actual experience has been of continued NAV outperformance in economic downturns, but sentiment may be adverse. ICGT’s permanent capital structure is right for unquoted/illiquid assets.
  • Investment summary: ICGT has consistently generated superior returns by adding value in an attractive market, having a strategic focus on defensive growth and leveraging synergies from being part of ICG since 2016. Valuations appear conservative, and governance is strong. ICGT focuses on delivering resilient, risk-adjusted returns, and balancing risk and reward. The risks are primarily sentiment-driven on costs, cyclicality and the underlying assets’ liquidity. A 25% discount to NAV appears anomalous with ICGT’s performance.
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