CD Private Equity Fund III (CD3) has announced a significant increase in net investment income and net operating profit for the year ended March 31, 2025. Net investment income surged by 472.3% to $17,265,007, while net operating profit increased by 726.6% to $18,555,329. This performance translates to basic earnings per unit of 25.76 cents, a substantial increase from 3.12 cents in the previous year.
The fund attributes this success to a robust rebound in the U.S. private equity market, characterized by increased deal values and strategic investment activity, especially in resilient sectors like technology and healthcare. Megadeals and public-to-private transactions have contributed significantly, driven by strong deployment from major sponsors. Improved exit conditions and seller flexibility further bolstered the fund’s results.
CD3 generated a total return of 14.5% on a post-tax net tangible asset (NTA) basis. Key components of this return include a $17.34 million fair value movement gain on the fund’s investment in its Limited Partnership (LP), encompassing an unrealized foreign currency translation gain of $5.81 million, and positive asset valuation movements of $11.53 million on the underlying portfolio. During the year, the fund distributed $14.41 million, or $0.20 per unit, to unitholders, funded by the realization of eight underlying portfolio companies. As of March 31, 2025, the fund’s post-tax net assets stood at $134.96 million, or $1.87 per unit.
The LP, in which CD3 holds a 71.2% interest, benefited from eleven underlying company sales during FY25. Despite geopolitical uncertainties and the imposition of widespread tariffs, PE managers demonstrated resilience and adaptability. The fund remains optimistic about the future, noting that its portfolio companies are well-positioned to navigate market dislocations. The fund had a total of 61 portfolio companies, with an average age of 5.6 years, underpinning the fund’s post-tax NTA as of March 31, 2025 of $1.87 per Unit.
CD3 closed the fiscal year with A$10.0 million in cash and the Fund’s share in the LP cash balance was US$6.0 million. The Manager continues to manage the LP’s cash flow for unforeseen events and market uncertainties. The fund remains committed to transparent updates and encourages unitholders to reach out with questions or comments.
