Quest for Growth business update 31 March 2022

Quest for Growth business update 31 March 2022

Results

Quest for Growth closed the first quarter of its financial year with a loss of € 4,055,061. The return on equity was -2.2%. This relatively good performance, compared to European stock market indices, is due to the successful sale of the stake in the German biotech company c-LEcta. Quest for Growth’s share price actually increased by 7.8% over the first three months of the year, reaching a closing price of € 8.60 on 31 March 2022. The discount of the share price in relation to the net asset value fell to 17.9% at the end of the quarter, compared to 25.5% at the end of 2021.

General meeting

On 31 March 2022, the general meeting approved a gross dividend payment of € 19,045,714. This equates to a gross dividend of € 1.02 (net: € 1.00) per ordinary share. The board of directors decided to give the shareholders the option to subscribe to a capital increase by means of the contribution of their net dividend claim via an optional dividend. The issue price was set at € 6.00 per new ordinary share. The dividend was paid on 21 April 2022, whereby 45% of the dividend rights (worth € 8,549,916) were converted into ordinary new shares.

Market environment

After an exceptional stock market year in 2021, the first three months of the new year proved to be volatile and challenging. The European stock market index STOXX Europe 600 Net Return fell by 6.0%. It is not unusual for the share prices of smaller companies to fall more sharply than their larger counterparts during a stock market correction. The same applies now, and the small cap index (STOXX Europe Small 200 Net Return) posted a bigger drop of 10.5%. The US stock exchanges managed to limit the damage to some extent. The S&P 500 in EUR fell a mere 2.0% thanks to the stronger dollar. The main cause of the turbulence on the world’s stock exchanges is skyrocketing inflation. This historically high inflation is putting pressure on central banks across the world to accelerate the phasing out of their expansionary monetary policies. Increasing geopolitical tensions due to the war in Ukraine have exacerbated the situation. This conflict is putting pressure on the share prices of cyclical and energy-intensive European companies.

Investments in quoted equities

The estimated performance of quoted equities stands at about -7%, and so they have held up well on the European stock market indices. Standing out from the rest was Accell, which saw its share price increase by a further 20% after an excellent year on the stock exchange in 2020. Stateside private equity player KKR made an offer of € 58 per share. Jensen enjoyed a further recovery in the demand for industrial laundry systems. Their shares rose by 18%, mainly after publishing their better-than-expected annual figures. Ultimately, Umicore’s share price managed to rise by 10%. After the sharp drop at the end of last year, investors were pleased with the annual results.