Transilvania Investments' strategy for the next 4 years: sustainable growth of net assets and investor returns
On 22 April this year, Transilvania Investments shareholders are invited to vote for the strategy that will be the core of the investment fund's activity for the next 4 years. Annual growth of at least 6% of the net asset value per share and annual reduction of at least 7% of the trading discount are the most important objectives of the investment fund team. The strategy proposed to shareholders for approval is published here.
The General Meeting of Shareholders takes place at a time when Transilvania Investments has obtained its best financial results in the last 5 years, with a profit of RON 237 million, increasing by 270% compared to the previous year and with assets under management amounting to RON 1.82 billion, increasing by 28%. The net asset value per share at the end of 2023 reached the record value of RON 0.8019.
These results allow the investment fund to allocate resources for development and investments and to ensure the shareholders remuneration both through the payment of dividends (RON 0.015/share, a yield of more than 5% related to the average trading price of the previous year) and through share buy-back programmes.
At the General Meeting of Shareholders to be held in Brasov, the investment fund comes to shareholders with a new executive team, currently under approval by the F.S.A., and an investment strategy for the next four years that responds to investor expectations. The main objective: maximising returns for the investors and ensuring sustainable growth of the net asset value.
Among the most important directions of action is the restructuring of the historical portfolio of holdings that have exhausted their growth potential. The Investment Fund has already taken the first steps in this direction by exiting from the shareholding of some companies, the exit policy being further implemented in order to secure sources of funding for investments with higher expected returns. Of these, assets in the tourism sector present important development opportunities. Solutions such as operating under international brands, which has been approached for the hotels in the ARO Palace portfolio, can also be implemented in other tourism companies in which the Fund is a majority shareholder.
Active trading, in order to maintain an adequate liquidity level profile of the managed portfolio, and efficient and centralised exploitation of real estate assets, including those of the industrial sector companies, are other directions of action that the fund team proposes to shareholders.
This strategy, based on balance and optimization, will allow Transilvania Investments to maintain the medium risk profile of the managed portfolio. For the first time, for the period 2024-2028, the fund defines clear objectives related to the annual growth of the Unit Net Asset Value (NAV) - at least 6%, and for the annual reduction of the trading discount - at least 7%.
Also as a new feature, Transilvania Investments will gradually review the company's sustainability policies and procedures (Environmental, Social, Governance), so that by 2028, the investment fund will integrate the sustainability-related risks into its investment decisions and consider the adverse impacts of investment decisions on sustainability factors. At the same time, the fund aims to gradually implement non-financial reporting in line with the relevant standards.
The information documents on the Fund's strategy, as well as on the other items on the agenda of the General Meetings of Shareholders convened for 22/23 April in Brasov are available on the company's website, in the sections O.G.M.S. April 2024 and E.G.M.S. April 2024. Shareholders who are unable to attend in person have the possibility to vote by electronic means or by correspondence until 19 April this year.
Brasov, March 29th, 2024
