Cadence Launches The First-Of-Its-Kind Tokenized Debt Security

Omni Bridgeway Limited (ASX: OBL) (Omni Bridgeway, OBL, Group) announces the key investment performance metrics for the three months ended 31 March 2024 (3Q24, Quarter) and for the financial year to date (FYTD).

Summary

• Investment income of A$296 million FYTD; A$56 million provisionally attributable to OBL.
• 23 full completions, 17 partial completions FYTD, with an overall multiple on invested capital (MOIC) of2.0x.
• A$333 million of new commitments FYTD with a corresponding A$447 million in new fair value, on track to achieve our A$625 million target.
• Pricing remains at improved levels, up 32% for the FYTD compared to FY23.
• Strong pipeline, with agreed term sheets outstanding for an estimated A$212 million in new commitments.
• OBL cash and receivables of A$101 million plus A$60 million in undrawn debt at 31 March 2024.
• A$4.4 billion of possible estimated portfolio value (EPV) in completions over the next 12 months. 
• Further simplification and enhancement of our disclosures as announced at the Annual General Meeting, comprising non-IFRS OBL-only financials and non-IFRS fair value on a portfolio basis and OBL-only basis.
• These new disclosures and metrics, as well as a valuation framework for our existing book and platform, were presented at our investor day on 27 March 2024.

Refer to https://omnibridgeway.com/investors/investor-day.

Key metrics and developments for the Quarter

Income and completions

• Investment income of A$296 million generated from A$193 million income recognised and A$103 million income yet to be recognised (IYTBR), with A$56 million provisionally attributable to OBL FYTD (excluding management and performance fees). 
• During the Quarter, 11 full completions and 11 partial completions (excluding IYTBR), resulting in 23 full completions and 17 partial completions (excluding IYTBR) FYTD, and one secondary market transaction, with a FYTD overall MOIC of 2.0x.

New commitments

• Our stated targets for FY24 include A$625 million in new commitments or equivalent value, prioritising value over volume to reflect potential for improved pricing of new commitments.
• FYTD new commitments of A$333 million at 31 March 2024 (from matters that were newly funded, conditionally approved or had increased investment opportunities). 
• The fair value associated with these commitments is $447million, 72% of the full year value generation target.
• Pipeline of 37 agreed exclusive term sheets, representing approximately A$212 million in investment opportunities, which if converted into funded investments is a further 34% of our FY24 commitments target.  
• In addition to the regular new commitments to investments in the existing funds FYTD, an additional A$11.5 million of external co-fundings were secured for these investments to manage fund concentration limits. OBL will be entitled to management fees as well as performance fees on such external co-funding.

Portfolio review

• A$4.4 billion of EPV is assessed to possibly complete in the 12 months following the end of the quarter. This 12 month rolling EPV is based on investments which are subject to various stages of (anticipated) settlement discussions or for which an award or a judgment is expected. All or only part of these may actually complete during the 12 month period.
• We anticipate replacing these final EPV metrics with fair value metrics by the end of this financial year.

Cash reporting and financial position

• At 31 March 2024, the Group held A$100.7 million in cash and receivables (A$62.8 million in OBL balance sheet cash, A$2.0 million in OBL balance sheet receivables and A$35.9 million of OBL share of cash and receivables within Funds) plus access to a further A$60 million in debt.
• In aggregate, we have approximately A$161 million to meet operational needs, interest payments, and fund investments before recognising any investment completions, secondary market sales, management and transaction fees, and associated fund performance fees.
• Post Quarter-end and as per the date of this report, in anticipation of the expiry of the availability period of the debt facility, OBL has drawn down the A$60 million in undrawn debt and received the funds.

Investor day

The investor day presentation and Q&A which took place on 27 March 2024 can be viewed at https://omnibridgeway.com/investors/investor-day.

The team around former Carpentum Capital has launched AURIGON LITIGATION RISK CONSULTING (LRC), a litigation funding intermediary based in Switzerland with a special focus on Latin America. 

Founder and Managing Director Dr. Detlef A. Huber comments: ”AURIGON LRC is combining two worlds, litigation finance and insurance. Both areas are increasingly overlapping. Insurers offer ever more litigation risk transfer products and funders recur to insurance to hedge their risks. Hence complexity and advisory requirements are increasing, especially in still developing markets like Latin America. With our team of lawyers and former re/insurance executives trained in Latin America, the US, UK and Europe we are perfectly suited to advice our clients in any stage of the funding process or in related insurance matters. Our goal is to become the preferred partner for litigation and arbitration funding projects out of Latin American jurisdictions and I am looking forward to this new adventure.”

ABOUT AURIGON

AURIGON Advisors Ltd. is operating as re/insurance consultancy since 2011 with a special focus on dispute resolution and auditing. With AURIGON LRC an intermediary for litigation funding has been launched servicing our clients out of Argentina, Chile, Brazil and Switzerland in Spanish, English, Portuguese and German. With our experience setting up the first Swiss litigation fund dedicated to Latin America (founded 2018), and in the insurance advisory area (since 2011), we are bringing together knowledge of processes and mindsets of the funding and the insurance world.