MONTCLAIR, NJ, Feb. 24 2022 (GLOBE NEWSWIRE) — 180 Degree Capital Corp. (NASDAQ: TURN) (“180” and the “Company”), today announced its financial results as of December 31, 2021, and other developments since the first quarter of 2022. The Company also issued a letter to shareholders which can be viewed at https://ir.180degreecapital.com/financial-results.
“We are pleased with our performance in the fourth quarter of 2021, and even more so with the performance for the full year 2021,” said Kevin M. Rendino, Chief Executive Officer of 180. generated a gross total return of +6.1% (or +9.0% including deferred interest from our separately managed account (“SMA”)) in the fourth quarter of 2021.1 Over the full year, our public markets investment strategy generated a gross total return of +34.7% (+38.2% with carried interest from our SMA). Our SMA also increased, with a gross total return of +5.4%. Our gross total return from our SMA in 2021 of +22.0% generated interest raised to 180 of $2.2 million and resulted in a net total return of +15.4%. We ended the quarter with approximately $114.7 million2 of total assets under management in 180 and our SMA, available to be deployed in our public markets investment strategy.
“While the value of our legacy private portfolio decreased by $1.6 million in the fourth quarter of 2021, we are currently encouraged by the possibility of monetizing certain investments in 2022,” said Daniel B. Wolfe, president of 180. “As noted in our previous press release, in a December 2021 investor presentation, Eli Lilly and Company indicated that it plans to commence human studies of the selective PI3Kα mutant inhibitor developed by the former 180’s holding company, Petra Pharma Corporation, in the first half of 2022. While 180 cannot assure our investors when such an event might occur, should such an event trigger a contractual payment to former Petra shareholders, 180 of which. The $6.8 million payment, if received, would increase cash per share by $0.66. Additionally, D-Wave Systems, Inc. announced its intention to become a publicly traded company through a merger with DPCM Capital, Inc. (“XPOA”), a special purpose acquisition company (” SPAC”). If the transaction is completed as currently agreed to by each party, 180 would own approximately 900,000 common shares of the combined company.
“Markets are currently experiencing extreme volatility and vicious selling,” Rendino added. “We live in what seems to be a very ‘frightened’ market. While our historical investment results have shown strong outperformance, we are not immune to the sell-off that occurred at the start of the year. We’ve had many sell-offs in our five-year history and through it all, the gross total return of our public and related assets is +373.6%. While it’s never fun to experience a sell-off, periodic washes, as we’re currently experiencing, allow us to find stocks that offer what we believe to be significant upside over 3-year cycles. Overall, while I am pleased with our fourth quarter 2021 results, I am more proud of our long-term results which better reflect the success of our public market strategy through a number of different market cycles.
The table below summarizes 180’s performance over periods through the end of Q4 2021:
|Trimester||1 year||3 years||Creation to date (5 years)|
|Q4 2021||Q4 2020- Q4 2021||Q4 2018- Q4 2021||Q4 2016-Q4 2021|
|Gross total return of the TURN public portfolio (excluding deferred interest SMA)||6.1%||34.7%||160.9%||373.6%|
|Gross total return of the TURN public portfolio (including deferred interest SMA)||9.0%||38.2%||178.5%||405.5%|
|Change of NAV||2.8%||14.9%||34.6%||51.9%|
|Change in share price||1.4%||10.4%||40.0%||77.5%|
|Russell Microcap Index||(2.7%)||19.3%||76.6%||73.8%|
|Russell Microcap Value Index||0.9%||33.6%||74.9%||72.0%|
Mr. Rendino and Mr. Wolfe will host a conference call tomorrow, Friday, February 25, 2022, at 9:00 a.m. EST to discuss fourth quarter 2021 results and developments during the first quarter of 2022. The call is accessible by phone at (609) 746-1082 passcode 415049 or via the web at https://www.freeconferencecall.com/wall/180degreecapital. Additionally, the slides that will be referenced during the presentation can be viewed on 180’s Investor Relations website at https://ir.180degreecapital.com/ir-calendar.
About 180 Degree Capital Corp.
180 Degree Capital Corp. is an exchange-listed, registered closed-end fund that focuses on investing in and providing value-added assistance through constructive activism to what we believe are small, significantly under-invested publicly-listed companies. assessed that have significant turnaround potential. Our goal is for the outcome of our constructive activism to lead to a reversal in the direction of the share price of these investee companies, i.e. a 180 degree turn. Detailed information about 180 and its holdings is available on its website at www.180degreecapital.com.
Daniel B. Wolfe
180 Degree Capital Corp.
This press release may contain forward-looking statements regarding future events. These forward-looking statements are subject to the uncertainties inherent in predicting future results and conditions. These statements reflect the current beliefs of the Company, and a number of important factors could cause actual results to differ materially from those expressed in this press release. Please see the company’s filings with the Securities and Exchange Commission for a more detailed discussion of the risks and uncertainties associated with the company’s business and other important factors that could affect the company’s actual results. Except as required by federal securities laws, the Company undertakes no obligation to update or revise these forward-looking statements to reflect new events or uncertainties. The reference and link to the www.180degreecapital.com website has been provided for convenience, and the information contained on this website is not incorporated by reference into this press release. 180 is not responsible for the content of third party websites.
1 Past performance does not predict or guarantee future performance. Gross unrealized and realized total returns of 180 cash and securities of publicly traded companies are compounded on a quarterly basis, and intra-quarter cash flows from investments or proceeds received from private investments are treated as cash inflows or outflows available to invest or respectively withdrawn for the purposes of this calculation. 180 is an internally managed registered closed-end fund that holds a portion of its assets in legacy private companies that are fair valued on a quarterly basis by the valuation committee of its board of directors. 180 is an internally managed registered closed-end fund and does not have an external manager who charges fees based on assets and/or performance. Please see 180’s filings with the SEC, including its 2021 Annual Report on Form N-CSR for more information on its expenses and expense ratios.
2 Cash, net of unsettled trades, including deferred interest and net of cash bonuses.