Neil Woodford has said his Patient Capital Trust is in “extremely good shape” arguing that a series of triumphs for some of his largest holdings have outweighed bad news for one of his biotech investments.
In the half-year results for his three-year-old trust, the manager revealed the trust’s net asset value rose 0.66% between December and June.
Year-on-year NAV fell 9% from 101p to 92p, while the trust’s share price dropped 15% to 83p.
The star manager said it was becoming “increasingly clear” that the company was succeeding in its mission to deliver shareholder value by supporting early stage companies.
During the period the trust was trading at a discount of 9.7%.
Milestones
Five of the trust’s holdings are now valued at more than $1bn – Autolus, Purplebricks, Oxford Nanopore, Benevolent AI and Immunocore.
“When we launched WPCT just over three years ago, our mission was to deliver shareholder value by investing in great ideas and help to turn those ideas into great businesses – great in terms of quality and in terms of scale,” he said. “I am pleased to report on a period during which the success of this mission is becoming increasingly clear.”
In particular, he said Autolus, Proton Partners and Benevolent AI had made a positive impact on NAV.
His largest two holdings, Autolus and Benevolent AI, were re-valued following their most recent rounds of fundraising. Autolus listed on the Nasdaq at a premium of 73% compared to the price of its previous funding round, while Benevolent AI raised $115m from new investors valuing the artificial intelligence healthcare business at $2bn. They account for 8.38% and 9.82% of the portfolio, respectively.
Proton Partners also achieved a “significant milestone” in April treating its first patient with proton beam therapy at its Newport centre, in South Wales. It makes up 7.35% of the trust.
Prothena
Woodford said the “positive progress” made by these investments offset the negative impact of one of his other top 10 holdings, Prothena, on the company’s net asset value.
Prothena has been a constant thorn in the side of Woodford’s trust. The American biotech company’s share price took a beating after facing multiple setbacks involving its star drug NEOD001, which ultimately resulted in the firm halting development on the product in April. Its shares are currently trading at $13.40 on the Nasdaq, down 65%.
In the trust’s half-year report, Woodford said he disagreed with the market’s reaction to Prothena’s failed clinical trials and would continue to work with the biotech firm and its management team on future strategy.
He noted that the company still has an early and mid-stage clinical pipeline and is “very well-funded” with $500m on its balance sheet.
Prothena is now the trust’s ninth largest holding at 3.42%.
