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SUPPORTING SUCCESS

2018 was a landmark year for LDC and the businesses we supported. Our teams across the UK delivered our highest ever rate of investment – £437million of equity in 23 companies, taking our three-year total to £1.1billion.

We partnered with the management teams of some of the UK’s best performing businesses, with firms as diverse as premium speaker brand Martin Audio and Europe’s leading photo chemical etching company, Precision Micro.

Every one of LDC’s seven regional teams invested in 2018, showing at once the power of our unique regional model and the importance of on the ground relationships. In addition, we supported our portfolio’s expansion through acquisition, adding a total of 25 complementary firms this year. 

This was the founding principle of LDC when we first began our journey in 1981 – providing capital and support to help grow bigger and better businesses and helping the UK prosper in return.

The performance of our portfolio in 2018 demonstrates this impact. LDC’s portfolio companies grew sales by an average of 13 per cent during the course of 12 months, three times faster than the average UK medium-sized business recorded at 4 per cent. LDC firms delivered higher profit growth too, 16 per cent compared with the medium-sized business average of 9 per cent [1].

We also helped our management teams take the next step on their journey, facilitating 26 divestments to new investors, including the sale of live entertainment business the NEC Group and the IPO of global games label and developer Team17. Throughout the year, we generated total proceeds of more than £1billion, representing an average return of 2.7 times.

These achievements were even more important given the prevailing sense of uncertainty that characterized business sentiment in the UK, caused by its imminent departure from the European Union and the prospect of slowing growth. 

Such a positive outcome can only come from the collective effort of many people. I’d like to thank the management teams we back for their belief and determination, the LDC team for its expertise and energy, our partners in the advisory market for their counsel and Lloyds Banking Group for its continued support.

Despite the current political and economic uncertainty, there are plenty of reasons to be optimistic. My many conversations with management teams highlight both the confidence and the capability of those individuals running the UK’s most promising businesses.

Looking ahead through 2019, our appetite to back those individuals remains as strong as ever. And our commitment to invest £1.2billion across the UK mid-market throughout the next three years remains unchanged. 

When it comes to backing business, it is times like these when experience counts. Having supported 600 ambitious management teams over more than 35 years, we have the confidence, perspective and expertise to help mid-market businesses across the UK succeed.

It’s what we’ve always done.

  • £437m invested in 23 companies in 2018
  • 13% average portfolio sales growth in 2018
  • 25 acquisitions supported across portfolio in 2018
  • £1bn proceeds from 26 exits in 2018
  • 90 diverse companies in the LDC portfolio

[1] Based on firms which in 2018 recorded revenue £10m - £300m and have 50 - 250 employees as reported on the FAME database of company information and business intelligence.

The Year Ahead