Pantheon International (PIN ) says it is ‘well positioned for growth’ as it navigates a private equity market held back by sluggish deal activity and a backlog of unsold assets. 

In annual results to the end of May, managers of the £1.4bn investment trust, Charlotte Morris and Helen Steers, described ‘a prolonged period of lower deal activity and a meaningful decline in distributions’.

They estimated there is now $3.6tn caught up across 29,000 companies globally that is yet to be exited and said companies are being held for longer by their respective backers, currently an average of around six years. 

Despite the stagnant backdrop, PIN’s distribution rate was up 50% on the previous financial year, from 8% to 12%, albeit below the trust’s long-term average. 

Distributions exceeded calls, leaving PIN net cash flow positive, generating £130.8m over the period – more than a three-fold increase over the previous year.

Talking to Citywire, and citing an uptick in IPO activity, Morris added: ‘Our expectation is that we’ll continue to see this kind of gradual recovery.’

Meanwhile, the trust said capital raised and available to invest across the industry had snowballed to $2.1tn – which Morris believes PIN’s portfolio is particularly well positioned to benefit from.  

‘One of the things we like about being at the smaller end is that the larger private equity managers will buy out those small and mid-market companies. So, the fact that they have lots of dry powder is really helpful for our portfolio.’

Defensive drivers

The trust’s net asset value (NAV) total return over the year was 1.2%, while shareholders were down 9.2%.

Growth in assets was 5.9%, with investment income adding 0.9% and share buybacks 1.5%. This was largely offset by unfavourable currency movements, which reduced the overall NAV by 4.8%. 

There were positive performances across all regions and sectors over the year, as well as all stages, with venture being the standout performer. 

PIN nonetheless maintains a 5% exposure to venture, with managers explaining that the sector ‘tends to be the most volatile part of the private equity universe and the dispersion of returns is even greater than in the buyout segment of the market’.

Managers said buyouts, which are well-established businesses and account for the majority of PIN’s portfolio, have performed consistently well over previous reporting periods and this was the case again.

‘We believe that this is due to PIN’s emphasis on companies that are operating in defensive sub-sectors within information technology, healthcare and consumer staples and services,’ they said, adding ‘these companies are benefitting from long-term trends that... are here to stay.’ 

Healthcare and technology co-investment deals generated strong returns of 20.1% and 19.1%, respectively. 

The trust has recently tilted its portfolio towards investing directly in private companies. As of 31 May, they accounted for 54% of the portfolio alongside growth funds. 

Results also gave an update on the trust’s mega but sector-typical discount, which as of yesterday stood at 33.7%.

During the period, a £50m buyback was announced, with a further £30m announced since May to cover the period to mid-September 2025. 

Chair John Singer said the trust had continued to evolve its thinking beyond weighing up buybacks relative to new investments, with greater consideration being given over when to utilise or repay debt, as well as more focus on ‘periodically rebalancing the portfolio, regularly reviewing to see if parts can be sold, and proceeds used to enhance shareholder returns’.

Commenting today, Deustche Numis analyst Ewan Lovett-Turner said: ‘We continue to believe that the shares offer excellent value, on a circa 35% discount, for a diversified portfolio of private equity interests, with a commitment to continue active share buybacks and the likelihood of a significant marketing push starting later in the year.’

PIN has a strong long-term record with share price total returns of 150.2% over the past ten years, according to the Association of Investment Companies.