## Oakley ## Capital ## Investments ### ANNUAL REPORT 2021 OC Oakley Capital Investments Annual Report 2021 At a glance # Total NAV Return per Share of 35% and Total Shareholder Return of 48% for 2021 - NAV per share since inception - Ten-year outperformance OUR OBJECTIVE Oakley Capital Investments ('OCI') aims to provide shareholders with consistent long-term returns in excess of the FTSE All-Share Index by providing exposure to private equity returns, where value can be created through market growth, consolidation and performance improvement. NAV per share since inception (pence at 31 December) ![img-0.jpeg](img-0.jpeg) ### Oakley Capital Investments Annual Report 2021 03 ## Total NAV Return ### FTSE All-Share and OCI share price ### performance over ten years ## per Share of ## (rebased to 100 at 1 January 2012) 48% ## 0 Significant outperformance in 2021 ## 35% and Total with a Total Shareholder Return for the year of 48%. ## Shareholder ## 1 ## Return of 48% ## 2 ## for 2021 350 300 ## 3 ### NAV per share since inception 250 ### Ten-year outperformance 200 ## 0 4 150 100 OUR OBJECTIVE 350 ## 5 1 Oakley Capital Investments (‘OCI’) aims to provide 300 shareholders with consistent long-term returns in excess of the FTSE All-Share Index by providing | 250 | | exposure to private equity returns, where value can | | --- | --- | --- | | | 6 2 | be created through market growth, consolidation | | 200 | | and performance improvement. | 150 www.oakleycapitalinvestments.com ## 3 7 100 50 0 FTSE All-Share OCI Share Price ## 4 8 At a glance FTSE All-Share OCI Share Price 20122011 2013 2014 2015 2016 2017 2018 2019 2020 2021 350 300 ## 9 5 250 200 ## 0 6 150 100 50 ## 7 0 20122011 2013 2014 2015 2016 2017 2018 2019 2020 2021 ## 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 04 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Why invest? Highlights and activity Chair’s statement ### Returns are driven by An active year for investments OCI investors benefitted ### profit growth in a high-quality by the Oakley Funds from another significant ### portfolio of companies uplift in NAV P.05 P.08 P.13 ## Business model Oakley funds Portfolio ### An established investor Outperforming funds focused A strong ### with superior returns on the Technology, Consumer tech-enabled ### and Education sectors portfolio P.17 P.36 P.53 | ESG and risk | Governance | Financial statements | | --- | --- | --- | | Being a responsible investor is paramount | A fundamental | Performance as at 31 December 2021 | | to the way OCI operates | component of the | | ### Company’s activities P.66 P.79 P.116 ## Contents ### Oakley Capital Investments Annual Report 2021 05 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS Private equity targets investments in ### Historically, private equity has been privately owned businesses across all ### walled off from retail investors – it’s sectors, from recognisable household ### right there in the name. But listed names to companies with significant ### private equity means anyone can growth potential. It then seeks to help these companies maximise their value ### access this market… during the holding period. While private equity funds are not accessible to most private investors, one attractive alternative is buying shares in listed investment companies that provide access to these funds and the performance of the private companies they back. OCI’s sustained, strong performance over the years has helped build credibility in listed private equity, an important development in the necessary democratisation of the wider asset class. ## Public access ### Public access to ## to private companies ### private companies ### Extraordinary opportunities ### A partner of choice ## Why invest in listed private equity? ### Oakley Capital Investments Annual Report 2021 06 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Extraordinary ## opportunities Their business models are predominantly ### Returns are driven by profit growth focused on tech-enabled services and ### in a high-quality portfolio of resilient, recurring revenues that have ### companies primarily across delivered strong trading performance. ### Western Europe in three distinct While some companies were impacted by temporary COVID-related restrictions, the ### sectors – Technology, Consumer wider portfolio enjoyed strong earnings ### and Education. growth, benefitting from accelerating long-term trends such as the increasing adoption of digital solutions by businesses and consumers, and growing demand for quality, accessible education. ### Public access to ### private companies ### Extraordinary opportunities ### A partner of choice ## Why invest in OCI? ### Oakley Capital Investments Annual Report 2021 07 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## A partner ## of choice Central to the ability to repeatedly source ### OCI benefits from its partnership and execute attractive deals is Oakley’s ### with Oakley Capital (‘Oakley’), entrepreneurial culture. Oakley was ### whose success is built on conceived by entrepreneurs to be the ### proprietary origination, with over partner of choice for entrepreneurs and this spirit lies at the heart of the firm’s ### 75% of deals being uncontested. culture. Over 20 years of investing with ### a focus on building deep, long-standing Public access to relationships across the Oakley network ### private companies has laid the foundations for future growth as the firm benefits from their help in sourcing, unlocking and executing deals, ### Extraordinary opportunities and driving value creation across the portfolio. ### A partner of choice ## Why invest in OCI? OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Financial highlights - Performance - Balance sheet and distributions - Portfolio companies # Performance OCI continued to benefit from the Oakley Funds' investment focus on businesses. NAV per Share increased to 538 pence, with a Total NAV of 35% and a Total Shareholder Return of 48%. Net Asset Value Net Asset Value ('NAV') of £961 million £961m ![img-1.jpeg](img-1.jpeg) Total NAV Return per Share Total NAV Return per Share of 35% for the year 35% ![img-2.jpeg](img-2.jpeg) OCI assesses its performance using a variety of measures that are not specific. Performance Measures ('APMs'). These APMs have been used as they are considered shareholders in assessing the performance of the Company. The APMs used by definition/explanation, their closest IFRS measure and, where appropriate, rec OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS ## Financial highlights - Performance - Balance sheet and distributions - Portfolio companies ## Balance sheet and distribution Full-year dividend of 4.5 pence and further cash deployed during the whole maintaining liquidity for new investments. Post year-end, an initial €400 million (£336 million) commitment announced to Fund V. ### Cash Cash of £163 million, representing 17% of NAV £163m 2021 £163m 2020 £223m 2019 £49m ### Dividend Full-year dividend of 4.5 pence 4.5p 2021 4.5p 2020 4.5p 2019 4.5p ### Oakley Capital Investments Annual Report 2021 10 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ### Performance ## Portfolio companies ### Balance sheet and ### distributions ### Strong earnings growth, with the portfolio benefitting from accelerating ### long-term trends such as the increasing adoption of digital solutions by businesses ## 0 ### and consumers, and growing demand for quality, accessible education. ### Portfolio companies ## 0 1 | | LTM EBITDA growth | EV/EBITDA multiple | Net Debt/EBITDA ratio | | --- | --- | --- | --- | | 2 1 | Last twelve months EBITDA | Average Enterprise Value to | Average Net Debt to EBITDA | | | growth of 28% | EBITDA multiple of 13.9x | ratio of 4.2x | ## 2 3 ## 4 3 ## 28% 13.9x 4.2x ### 2021 2021 2021 ### 28% 13.9x 4.2x ## 4 0 5 ### 2020 2020 2020 ### 20% 11.8x 3.9x ### 2019 2019 2019 ### 30% 12.1x 3.7x ## 0 6 5 1 ## 0 6 0 7 2 1 ## 7 2 8 3 0 1 1 ## 8 3 9 4 2 Financial highlights 2 1 ## 4 0 9 3 5 3 2 ## 0 6 4 4 5 3 ## 6 5 5 7 4 ## 6 7 8 6 5 ## 8 9 7 7 6 ## 0 9 8 8 7 ## 0 9 9 8 ## 0 0 9 ## 0 ### Oakley Capital Investments Annual Report 2021 11 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Portfolio activity ## New ## 2021 ## investments ### New investments on idealista ### a look-through basis. ### SeeGlossary for Fund IV acquired a minority stake in idealista, an online real estate ### further details. Dexters JAN classifieds platform in Southern ## 0 Fund IV acquired a controlling Europe, present in Spain, Italy and stake in Dexters, London’s leading Portugal. independent chartered surveyor and estate agent. ### Total invested ## 1 FEB ## £43m Investment ## £13m Investment ## 2 £ m MAR ## 3 ECOMMERCE ONE The Origin Fund completed the ### New investments APR acquisitions of Afterbuy and ICP Education DreamRobot, two providers | | | Fund IV completed the acquisition | of e-commerce software in | | --- | --- | --- | --- | | 0 4 | Realisations & | | | | | | of a majority stake in ICP | German-speaking Europe, | ### refinancings Education, an independent group together creating the of UK children’s nurseries. ECOMMERCE ONE Group. MAY ## 5 1 ## £27m £6m Investment Investment JUN ## 0 6 2 ## 3 7 1 ## 4 8 2 ## 9 5 3 ## 0 6 4 ## 7 5 ## 8 6 ## 9 7 ## 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 11 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Portfolio activity ## New ## 2021 ## investments ACE Education The Origin Fund completed its ### New investments on investment in ACE Education, JUL ### a look-through basis. a private vocational ### SeeGlossary for higher education platform in France and Spain. ### further details. ## 0 AUG ## £10m Investment ### Total invested Seedtag ## 1 The Origin Fund completed a minority investment in Seedtag, a SEPT leader in contextual advertising in EMEA and Latin America. ## 2 £ m ## £7m OCT Investment ## 3 ### New investments ## 0 4 Realisations & NOV ### refinancings ## 5 1 DEC ## 0 6 2 ## 3 7 1 ## 4 8 2 ## 9 5 3 ## 0 6 4 ## 7 5 ## 8 6 ## 9 7 ## 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 12 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Portfolio activity ## Realisations ## 2021 ## & refinancings ### Realisations and refinancings ### on a look-through basis. ### See Glossary for ### further details. IU Group JAN IU Group completed a refinancing resulting in a distribution to Fund III. ### Total realised FEB ## £29m Refinancing Daisy The Daisy Group disposed of ## £ m its Digital Wholesale Solutions MAR division, resulting in a distribution to Fund II, and all outstanding loans to OCI being repaid. ### New investments APR ## £22m Partial exit and debt repayment ### Realisations & ### refinancings MAY ## 0 JUN ## 0 0 1 ## 2 1 1 ## 3 2 2 ## 4 3 3 ## 4 4 5 ## 6 5 5 ## 6 6 7 ## 8 7 7 ## 9 8 8 ## 0 9 9 ## 0 0 ### Oakley Capital Investments Annual Report 2021 12 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Portfolio activity ## Realisations ## 2021 ## & refinancings ACE Education Fund III exited its investment ### Realisations and refinancings in ACE Education, a private JUL ### on a look-through basis. vocational higher education ### See Glossary for platform in France and Spain. ### further details. ## £16m AUG Exit ### Total realised SEPT Contabo ## £ m Contabo completed a refinancing resulting in a distribution to Fund IV. OCT ## £13m ### New investments Refinancing | | Realisations & | | NOV | | | --- | --- | --- | --- | --- | | | refinancings | IU Group | | 7NXT | | | | IU Group completed a refinancing | | 7NXT completed a refinancing | | | | resulting in a distribution to | | resulting in a distribution to the | | 0 | | Fund III. | | Origin Fund. | DEC | | | £36m | £5m | | --- | --- | --- | --- | | 0 0 | 1 | | | | | | Refinancing | Refinancing | ## 2 1 1 ## 3 2 2 ## 4 3 3 ## 4 4 5 ## 6 5 5 ## 6 6 7 ## 8 7 7 ## 9 8 8 ## 0 9 9 ## 0 0 ### Oakley Capital Investments Annual Report 2021 13 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## The Company’s ## underlying investments ## maintained their pattern ## of strong growth with ## average EBITDA increasing ## by 28%, underpinned by ## the portfolio’s focus on ## digitally enabled businesses ## and recurring revenues. Caroline Foulger Chair ## Chair’s statement ### Oakley Capital Investments Annual Report 2021 14 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS | | I am delighted to report that OCI has | years has helped build credibility in the | has also strengthened its lead in the | | --- | --- | --- | --- | | | continued to deliver on its long-term | listed private equity sector, an important | education sector with new platform | | | strategy, generating an impressive Total | development in the democratisation of | deals, including ICP Education, a chain | | | Shareholder Return of 48% during the | this outperforming asset class. | of premium, early-years education | | 0 0 | | | | | | period. Our investors benefitted from | | centres in London, and a reinvestment | As the Investment Adviser sets out in its another significant uplift in NAV, with in ACE Education, which specialises in report, the universe of public equities is the value of OCI’s portfolio increasing on-campus vocational higher education. shrinking as more companies, especially by more than a third, driven by healthy Both investments enable OCI to continue ## 1 1 high-growth, tech-enabled businesses, earnings and realisations. Indeed, 76% of tapping into the growing, global demand opt to partner with private equity the increase in the portfolio’s value was for quality, accessible education. instead. It is important to ensure that driven by EBITDA growth. shareholders can participate in the long- Cash and commitments | 2 2 | | | | The Board is pleased to confirm an | | --- | --- | --- | --- | --- | | | The Company’s underlying investments | term upside we expect these companies | | | | | | | At year-end, OCI had cash on the | initial €400 million commitment to | | | maintained their pattern of strong | will generate in the years to come, and | | | | | | | balance sheet of £163 million and no | Fund V, continuing our mandate of | | | growth with average EBITDA increasing | I am proud that OCI is helping to make | | | | | | | debt. A strong cash position provides | investing in the Oakley Funds. With | | | by 28%, underpinned by the portfolio’s | this happen through the diversification of | | | | 3 3 | | | the necessary firepower for new Fund | more private businesses looking for | | | focus on digitally enabled businesses | our shareholder register, as you will read | | | | | | | investments, not only in platform deals | alternative sources of capital and a | | | and recurring revenues. OCI also | about later. | | | | | | | but also for follow-on acquisitions. Buy- | rich pipeline in place, OCI has the | benefitted from robust investor appetite New investments and-build remains a core value creation resources to help finance new Fund for Oakley’s portfolio companies, ## 0 4 4 driver for Oakley, as you will read about investments in the coming years, using including TechInsights, which was sold Many of these private companies in the Investment Adviser’s report. Over balance sheet cash as well as proceeds in February 2022 at a 131% premium to consider Oakley as their partner of half of the current portfolio are pursuing from anticipated future realisations. At the June book value. These results are a choice to help them realise their strategic this growth strategy, and it is testament the same time, the Board is pleased clear demonstration of the Investment goals. During the period, the Oakley ## 5 5 1 to Oakley’s expertise and track record to reiterate our intention to realise, at Adviser’s unique origination strategy, network continued to generate strong in this space that it has successfully the right point, our direct debt and proven value creation drivers and opportunities for new investments completed more than 100 bolt-ons to equity investments in specific portfolio effective active management. at attractive valuations, the key to date. With Fund IV now effectively 75% companies as we focus entirely on future growth. It is pleasing to see ## 2 0 6 6 The democratisation of invested, attention turns to Oakley’s committing to the Oakley Funds. further diversification, accelerating private equity successor fund. Oakley’s transformation into a true, | | | The results are also a validation of OCI’s | pan-European investor. In Iberia, where | | --- | --- | --- | --- | | | | continued strategy and mandate to | Oakley is already busy building the | | 0 3 7 7 | 1 | | | | | | invest in the Oakley Funds, with a five- | region’s leading business software | | | | year compound annual growth rate | platform Grupo Primavera, it has added | | | | (‘CAGR’) of 19%. Importantly, they are | investments in property portal idealista | ## £163m €400m also a validation for the wider asset class. as well as Seedtag, a leading ad-tech ## 4 8 8 2 1 Cash on the balance sheet Initial commitment to Fund V business. While these latest investments As Chair, I am heartened to see how this have a pronounced digital flavour, Oakley sustained, strong performance over the ## 0 5 2 9 9 3 ## Chair’s statement ## 6 3 0 0 4 1 ## 4 2 7 5 ## 3 8 5 6 ## 4 9 6 7 ## 0 5 7 8 ## 6 8 9 ## 7 9 0 ## 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 15 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Chair’s statement Environment, Society and I am pleased to report that OCI has Governance (‘ESG’) advanced its own direct Corporate Social Responsibility programme which There has been significant progress will focus on supporting local charities in Oakley’s ESG and sustainability and youth programmes in Bermuda, strategies, which we continue to ## It is encouraging to see so much where OCI is headquartered. encourage as a way to de-risk investments, support value creation ## progress achieved in Oakley’s Enhanced communications and demonstrate Oakley’s commitment The Board reiterates its strong to responsible investing. On page 69, ## ESG and sustainability strategies, commitment to enhanced you can read more about the carbon communications and transparency reduction and diversity & inclusion ## and you can read more about the with OCI’s investors. During the period, initiatives launched both by the we announced our intention to move Investment Adviser as well as within ## carbon reduction and diversity to quarterly NAV updates in 2022 and individual portfolio companies, including I am pleased to confirm that this will IU Group for example, which has laid ## & inclusion initiatives launched begin with our Q1 results on 27 April. out an ambitious road map to become In 2021, we continued to invest in our Germany’s first zero carbon university. ## both by the Investment Adviser as digital communications, including the As we highlighted in our interim results, launch of our first digital Annual Report ## well as within individual portfolio as well as increasing social media engagement. We are also investing ## companies. in our website, to better engage with a wider pool of stakeholders, and to reach a new generation of investors. Enhanced digital communications help us to better tell OCI’s story and inform stakeholders about our investment strategy, our underlying portfolio as well as the key drivers of NAV growth: they also help OCI to communicate the wider opportunity in listed private equity. Photo credit: Endeavour Sailing, Bermuda ### Oakley Capital Investments Annual Report 2021 16 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Chair’s statement | Discount | Share purchases | | --- | --- | | It is pleasing to note that the discount | During the period, the Board authorised | | in OCI’s share price to underlying NAV | a buy-back of 2 million shares, which | ## 4.5p | had shrunk to 6% at year-end, the lowest | were acquired and cancelled at a price | | | --- | --- | --- | | year-end gap in eight years. This follows | of 354 pence. Board members, Oakley | annual dividend | | a sustained focus on communicating our | partners and employees also continued | | | strategy, results and key performance | to buy shares during the period and | | | drivers as well as a disciplined share | now own 12% on a combined basis. I | | | buy-back programme. The Board | note an article from the Financial Times’ | | | remains confident that these measures, | Money section: ‘Skin in the game gives | | Outlook together with sustained strong investment trusts a vital edge. The OCI has sustained its outperformance investment performance, will ensure directors’ interests are aligned with throughout the COVID-19 pandemic, that the share price better reflects the shareholders - that’s a key advantage.’ largely avoiding the challenges that quality and potential of the underlying The title, I believe, speaks for itself. have disrupted the wider global investment portfolio. We achieved further shareholder economy. Oakley’s sharp focus on diversification during the year. The top active management and value creation ten shareholders’ combined holding helped its tech-enabled portfolio to decreased from 80% in 2018 to 61% as continue generating strong earnings at 31 December 2021, with an increasing growth for us. Its unique deal sourcing number of private investors attracted ## 0 network continued to unearth promising to OCI’s performance as well as the investment opportunities at attractive superior returns and liquid access that valuations. Looking ahead to a period listed private equity provides. of geopolitical, market and economic volatility, the Board is very confident Dividend ## 0 1 about Oakley’s capabilities as a leading In April 2021, a final dividend of 2.25 private equity investor, as well as the pence per share was paid for the period long-term potential of the Oakley Funds, ended 31 December 2020. An interim ## 12% to continue generating superior returns dividend of 2.25 pence per share was for investors. ## 2 1 OCI Board and Oakley employees paid in October. share ownership Caroline Foulger Chair 9 March 2022 ## 3 2 ## 0 ## 4 3 ## 0 1 ## 4 5 ## 2 1 ## 6 5 ## 3 2 ## 6 7 ## 4 3 ## 8 7 ## 5 4 ## 9 8 ## 6 5 ## 0 9 ## 7 6 ## 0 ## 8 7 ## 9 8 ## 0 9 ## 0 ### Oakley Capital Investments Annual Report 2021 17 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## Our relationship with Oakley Capital ## Oakley Capital Investments Oakley Capital ## (‘OCI’) (‘Oakley’) ### Provides liquid access to a portfolio Leading private equity firm specialising ### ofhigh-quality private companies and in fast-growing, mid-market companies ### market-leading returns by investing in across the Technology, Consumer and ### the Funds managed by Oakley. Education sectors. Invests in Oakley Funds, enabling Unique origination capabilities and proven investors to share in the growth and value creation strategies performance of high-quality, private Focus on key sectors underpinned by companies in attractive sectors accelerating megatrends Board of Directors safeguards the interests of shareholders ### Oakley Capital Investments Annual Report 2021 18 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## The Oakley Capital difference ### Deal origination Value creation ### Oakley’s success is built Oakley’s Investment ### on its unique network of Team works closely Our entrepreneurial Our tech-enabled portfolio ### entrepreneurs, many of DNA means we are with founders and and our focus on sticky, the partner of choice recurring revenues provide ### whom it has backed on management teams to for entrepreneurs: we valuable income visibility ### repeat deals, and who empathise with founders; create sustainable value and predictability which we understand their further underpins the value ### go on to invest in the through M&A, growth mindset; we anticipate of our companies. ### Oakley Funds and their priorities and acceleration, business concerns. ### introduce new transformation and ESG ### opportunities. integration. ### Oakley Capital Investments Annual Report 2021 19 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## Oakley Capital’s focus on key sectors is ## underpinned by accelerating megatrends ### Key sectors ### Deal-sourcing network ### Consumer shift to online Regions and sectors that are ripe for digital disruption. ### Adding value Consumer ### Growing global demand for ### high-quality accessible learning Online platforms and market consolidation drive provision at scale. ### Business migration ### to the cloud Companies looking to deliver Education efficiency and productivity gains. Technology ### Oakley Capital Investments Annual Report 2021 20 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## Unique deal sourcing network ### Key sectors ### Business founder network Navigating complexity ### Deal-sourcing network Business founder network provides Successful track record of navigating ### privileged access to off-market complexity across multiple dimensions: ### Adding value opportunities and creates frequent carve-outs, founder-led and complex ### repeat partnerships. stakeholder management. ## 88% 75% 9.4x Primary deals Uncontested deals Average entry multiple ### Oakley Capital Investments Annual Report 2021 21 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## Proven value creation strategies ### Key sectors Business Performance Talent ### Deal-sourcing network Buy-and-build Transformation improvement acquisition ### Adding value Oakley provides the expertise and ## Buy-and-build resources for portfolio companies to source and execute transformative acquisitions. These include sizable deals Roll-up strategies that enable them to scale up quickly and expand into new products or markets, as well as roll-up strategies that add Portfolio smaller acquisitions to a larger platform companies and enable consolidation in fragmented markets. To date, Oakley has supported Oakley has supported its Expertise & resources its portfolio companies with over 100 portfolio companies with over bolt-on acquisitions. ## 100 bolt-on acquisitions ### Oakley Capital Investments Annual Report 2021 22 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## Proven value creation strategies ### Key sectors Business Performance Talent ### Deal-sourcing network Buy-and-build transformation improvement acquisition ### Adding value Oakley works with management teams ## Business transformation to leverage digital tools and skills in order to meaningfully enhance the way a company does business, from migrating its services online to launching new e-commerce channels. Improving the quality and predictability of earnings by Leverage digital shifting sales to a software as a service tools and skills to (‘SaaS’)/recurring revenue model can have enhance the way a company does a meaningful impact on valuations. Today, business over 70% of Oakley’s current portfolio is digital/tech-enabled. Portfolio company management team ### Oakley Capital Investments Annual Report 2021 23 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## Proven value creation strategies ### Key sectors Business Performance Talent ### Deal-sourcing network Buy-and-build transformation improvement acquisition ### Adding value Oakley helps businesses reach their ## Performance improvement potential by deploying a range of tools to enhance their performance. Achieving marketing excellence is one effective method and the firm has deep experience working with portfolio companies to identify the optimal marketing channels Marketing tools that will help their business to build its brand. Investment in marketing can be complemented by other performance Portfolio enhancement tools, such as improving companies yield management and boosting cross-selling. ### Oakley Capital Investments Annual Report 2021 24 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Business model ## Proven value creation strategies ### Key sectors Business Performance Talent ### Deal-sourcing network Buy-and-build transformation improvement acquisition ### Adding value A key asset in any business is human ## Talent acquisition capital, and Oakley helps portfolio companies attract and retain the best talent. In the case of corporate carve- outs, Oakley can assemble entire new management teams as well as recruit for critical roles such as sales, marketing, technology and finance. With founder-led businesses, Oakley will often strengthen Portfolio management by building out a team to companies support entrepreneurs or formulate a succession plan. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS ## Portfolio overview # A strong, tech-enabled portfolio The Oakley Funds invest primarily in unquoted, pan-European businesses across three sectors: Technology, Consumer and Education ![img-3.jpeg](img-3.jpeg) The Total Portfolio is the fair value of OCI's investments, made up of the Oakley Funds' investments on a look-through basis and OCI's direct investments. See the Glossary for a reconciliation of the Total Portfolio to OCI's NAV. Technology £199 Consumer £470 Education £252 OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS ## Portfolio overview # A strong, tech-enabled portfolio The Oakley Funds invest primarily in unquoted, pan-European businesses across three sectors: Technology, Consumer and Education ![img-4.jpeg](img-4.jpeg) The Total Portfolio is the fair value of OCI's investments, made up of the Oakley Funds' investments on a look-through basis and OCI's direct investments. See the Glossary for a reconciliation of the Total Portfolio to OCI's NAV. Technology £199 Consumer £470 Education £252 ### Oakley Capital Investments Annual Report 2021 27 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Portfolio overview ## A strong, tech-enabled portfolio ### Technology WebPros £61.6m TechInsights £58.4m Grupo Primavera £43.2m ## £199.0m Contabo £13.7m Seedtag £8.7m Daisy £7.5m ACE ICP ECOMMERCE ONE £5.9m Education Education WebPros Ocean Technologies Group TechInsights Grupo Primavera ### Consumer North Sails £159.1m Time Out £72.5m Contabo Schülerhilfe idealista £58.3m ## Seedtag £470.3m Facile £43.2m IU Group Wishcard Daisy ## 0 Technologies Group £38.7m Total Portfolio WindStar Medical £31.4m | | atHome | | | | Dexters £29.2m | | --- | --- | --- | --- | --- | --- | | 1 | | | | ECOMMERCE ONE | | | | | £ . | m | | | Iconic BrandCo £20.3m 7NXT £9.7m (Total Portfolio 2020: £638.2m) ## 2 7NXT atHome £7.9m ## 0 3 Iconic BrandCo North Sails Dexters ## 4 1 WindStar ### Education IU Group £131.2m Medical ## 2 5 Schülerhilfe £46.1m Time Out Ocean Technologies Wishcard Technologies Group ## Facile £252.3m Group £38.5m ## 3 6 idealista ICP Education £27.0m ACE Education £9.5m ## 0 4 7 The Total Portfolio is the fair value of OCI’s investments, made up of the Oakley Funds’ investments on a look-through basis and OCI’s direct investments. See the Glossary for a reconciliation of the ### The Oakley Funds invest primarily in unquoted, Total Portfolio to OCI’s NAV. ## 0 5 8 1 ### pan-European businesses across three sectors: ### Technology, Consumer and Education ## 2 6 1 9 ## 2 3 0 7 ## 3 4 8 ## 4 5 9 ## 5 6 0 ## 6 7 ## 7 8 ## 8 9 ## 9 0 ## 0 ### Oakley Capital Investments Annual Report 2021 28 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Portfolio overview ## The largest contributors to ## NAV growth in our portfolio ### Student intake growth of Trading performance ### 34% vs the prior year increased fair value by 277% | | IU Group has further strengthened | | TechInsights delivered strong | | --- | --- | --- | --- | | | its position as Germany’s largest and | | performance during the year, with | | | fastest growing university group in | | 2021 proving to be an inflection | | | the period. The company achieved | | point. Run rate revenues and | | | intake, revenues and EBITDA growth | | EBITDA were up 31% and 15% vs | | | of 34%, 62% and 68% respectively | | prior year, respectively. In February | | | against a strong previous year. Tech- | | 2022, Fund III exited its stake in the | | | enabled IU Group has successfully | | business at a 131% premium to the | | +52 pence | | +24 pence | | | | tapped into a global trend that | | June book value and generated | | NAV per share uplift | | NAV per share uplift | | | | accelerated during the pandemic: | | gross returns of 19.0x MM and 82% | ## 0 the growing demand for quality, IRR. As part of the transaction, accessible tertiary education and Fund IV acquired a majority stake, corporate learning. alongside CVC Growth Funds. ## 0 ## 1 ## 1 ## 2 Read more on page 64 Read more on page 55 ## 0 2 ## 0 3 ## 3 1 ## 4 1 ## 4 2 ## 2 5 ## 5 3 ## 3 6 ## 6 4 ## 4 7 ## 7 5 ## 5 8 ## 8 6 ## 6 9 ## 9 7 ## 0 7 ## 0 8 ## 8 ## 9 ## 9 ## 0 ## 0 ### Oakley Capital Investments Annual Report 2021 29 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Portfolio overview ## 0 ## The largest contributors to ## 1 ## NAV growth in our portfolio ## 2 ### 2021 full year revenue growth ### of 68% Wishcard has continued to ## 3 Wishcard is Europe’s deliver strong performance in 2021, recording full-year revenue ## growth of 68% vs the prior year. leading gifts and rewards The business has recorded ## strong growth across all business platform, selling over ## 4 segments, with particularly ## impressive e-commerce sales, which 9 million multi-brand gift ## +10 pence more than doubled vs last year. NAV per share uplift ## cards a year. The company ## 5 ## has experienced phenomenal ## growth thanks to its market- ## 6 ## beating combination of over ## 500 redemption partners ## 7 ## and an omnipresent ## Read more on page 60 distribution network. ## 8 ## 0 9 ## 0 1 ## 2 ## 3 ## 4 ## 5 ## 6 ## 7 ## 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 30 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Leader ## in contextual advertising in ## EMEA & Latin America New investment: Seedtag combines The increasing importance of consumer best-in-class technology and strong privacy and GDPR rules is expected partnerships with leading brands and to drive a shift away from third-party premium publishers. cookies, and advertisers will no longer be able to reach target audiences by Founded in Madrid in 2014, Seedtag helps leveraging user browsing history. As a brands and agencies to deliver digital result, brands and agencies are searching advertising that is directly relevant to for reliable alternatives, such as Seedtag’s the content that readers are consuming. proprietary software that does not rely Oakley’s investment will support the on the use of cookies, to help them to Company’s expansion into the US and understand consumer interests while fund further investment in its contextual targeting priority audiences. AI technology at a time of profound change for the advertising industry. Portfolio company: Seedtag ## Case study ### Oakley Capital Investments Annual Report 2021 31 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Investment Adviser’s report ## In these times, it pays to embrace a ## prudent, conservative approach to ## valuations, as we have consistently ## done. Our portfolio’s 14x average ## valuation multiple and the strong ## exit premiums we achieve, including ## most recently with TechInsights, ## demonstrate how we do not rely on ## inflated stock markets to boost our ## portfolio valuation. ### Oakley Capital Investments Annual Report 2021 32 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Investment Adviser’s report Another record year for A certain bet for uncertain times ### We remain confident ## 0 private equity The market sell-off that we witnessed ### that our tech-enabled During 2021, so many of the metrics at the beginning of 2022 was triggered ### portfolio focused on we use to measure the growth and by questions about the sustainability of exuberance of private equity reached new tech earnings, in particular whether the ### resilient, recurring and highs: record fundraising levels, record COVID-19 boost that many companies ## 1 ### growing revenues puts valuations particularly in ‘hot’ sectors enjoyed was just a temporary blip. such as technology, buoyant investment Suddenly, the buoyant equity prices that ### us in a strong position activity and high earnings growth. In this underpinned the high multiples for many ### to continue our | | | environment, our diversified portfolio of | investment portfolios, including those | | --- | --- | --- | --- | | 2 | outperformance. | high-growth companies continued to | comprising private companies, have given | | | | deliver superior returns, while our unique | way. In these times, it pays to embrace | | | | network helped us source promising | a prudent, conservative approach to | | | | new investments at attractive valuations. | valuations, as we have consistently done. | foundations for the next period of More recently, we have witnessed how Our portfolio’s 14x average valuation growth following our reinvestment. ## 3 accelerating inflation and higher interest multiple and the strong exit premiums Meanwhile, our transformation of | | rates have triggered market volatility | we achieve, including most recently with | | | --- | --- | --- | --- | | 9.4x | | | Alessi’s online channels has turbo- | | | post year-end, as supply chain pressures | TechInsights, demonstrate how we do not | | charged its e-commerce business: Oakley average entry multiple and labour shortages build in the global rely on inflated stock markets to boost our on Black Friday alone, the Italian economy. Geopolitical tensions have portfolio valuation. Instead, its strength is homeware brand sold more goods ## 4 also impacted markets. In spite of these based on earnings growth, proven value online than for the whole of 2018. challenges, we remain confident that creation strategies and Oakley’s active our tech-enabled portfolio focused on management that we can see playing out resilient, recurring and growing revenues in so many ways. For example, our focus ## 12.1x ## 0 5 puts us in a strong position to continue on transforming TechInsights’ business Industry average entry multiple our outperformance. model from project fees to subscription- based revenues helped underpin its exceptional realisation and provides firm ## 6 1 ## 0 2 7 ## 0 0 3 8 1 ## 2 4 9 1 1 ## 3 0 5 2 2 ## 4 6 3 3 ## 5 4 4 7 ## 6 8 5 5 ## 7 9 6 6 ## 8 0 7 7 ## 9 8 8 ## 0 9 9 ## 0 0 ### Oakley Capital Investments Annual Report 2021 33 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Investment Adviser’s report | | | Great oaks from little acorns grow | SaaS provider COMPAS to Ocean | in Seedtag demonstrates the enduring | PE can be a force for good | | --- | --- | --- | --- | --- | --- | | | | | Technologies Group, accelerating the | strength of the Oakley network, where | | | | | While digitisation remains a key | | | Embracing responsible investing (‘RI’) | | | | | transformation of the portfolio company | entrepreneurs and contacts help us | | | | | component in our value creation | | | helps to de-risk our investments and | | | | | from an e-learning business for ship | source proprietary deals. Our investment | | | | | toolkit, buy-and-build is another | | | create long-term value. During the | | | | | crews to the leading software provider | in children’s nursery group ICP Education | | | | | effective method for Oakley to deploy | | | period, we accelerated a number | | | | | to the maritime industry. Ekon combined | followed a detailed sector screening | | | | | capital and create value, especially | | | of important initiatives to support | | 0 0 | | | with PRIMAVERA and rebranded to | exercise and builds on our significant | | | | | during periods of high valuations. To | | | RI, including an in-depth carbon | | | | | Grupo Primavera to become the largest | track record in education. Meanwhile, our | | | | | date, we have completed over 100 | | | footprint audit to support our journey | | | | | independent provider of business | acquisition of London’s leading estate | | | | | bolt-on acquisitions and during the | | | to becoming a net-zero organisation | | | | | software in Iberia, helping more | agent Dexters underlines our confidence | | | | | period added crew management | | | in the near future. We also completed | | | | | companies migrate mission-critical HR, | working with complex investment | | | 0 | 1 1 | | | | a diversity & inclusion assessment | | | | | payroll and accounting software to the | situations. Together, our investments in | | to inform our recruitment policies at cloud. Meanwhile, WindStar Medical 2021 have maintained our strong long- Oakley, in the firm belief that diverse, added L.A.B. Cosmetics, a leading term record with 88% of deals being inclusive teams make better investment provider of products in the fast-growing primary and 75% uncontested, since decisions and deliver better outcomes. clean beauty category. inception. ## 2 2 1 We also enhanced climate reporting at a portfolio company level in order to help ## 88% The rise in competition for private Oakley invests for the future management teams better understand assets Primary deals As our portfolio grows, we continue to ‘double materiality’, or how their activities As we highlighted in our introduction, the invest in the Oakley platform to support are impacting climate change, as well ## 0 2 3 3 sheer growth of so-called ‘dry powder’ deal origination, value creation and as how climate change can impact their has intensified the competition to buy active management across our core operations. Measuring data in this way the most desirable businesses, but markets. Our Milan office opened in will empower Oakley and our companies paying over the odds can be dangerous 2021, adding to our existing network to set ambitious goals and targets | | | 75% | for future returns. In this environment, | in London, Munich and Luxembourg. | | | --- | --- | --- | --- | --- | --- | | 4 4 3 | 1 | | | | that will make our organisations more | | | | | maintaining an edge in deal origination is | During the period, we sustained a steady | | | | | Uncontested deals | | | resilient and help contribute to a better | | | | | key. For Oakley, this includes the unique | expansion across all teams, including | | tomorrow. | | toolkit we can offer business founders, | our Investment Team, investor relations, | | --- | --- | --- | | | the power of our network, as well as | communications, HR, finance and | | 2 4 5 5 | our ability to unlock complex situations. | compliance. Our well-invested platform | | | The founders of L.A.B. chose to partner | means we are well-placed to continue | | | with WindStar Medical and with Oakley | generating strong outcomes for all our | | | in particular because of our successful | stakeholders, and to deploy fresh capital | | | track record helping grow digital | as we launch our fundraising for Fund V. | | 3 5 6 6 | | | consumer platforms. Our investment ## 4 6 7 7 ## 5 7 8 8 ## 6 8 9 9 ## 0 0 7 9 ## 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 34 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Investment Adviser’s report Outlook and M&A. Oakley excels in successfully applying these value drivers, as our The growth in private equity as an track record demonstrates. Founder industry and asset class means there managers appreciate this track is more money than ever to deploy record, and, we believe, see Oakley as in new investments. While that is their partner of choice thanks to our expected to sustain high valuations and empathetic, entrepreneurial approach to competitive sales processes, there is business partnerships. Looking ahead, also a greater range of opportunities we remain confident about our ability for private equity investors to put their to continue sourcing highly attractive capital to work. Data shows that more deals, applying proven strategies to privately owned businesses are staying accelerate sustainable growth, and private for longer: some are choosing creating businesses that will succeed in to avoid public market IPOs altogether. a changing world. Instead, they are choosing to partner with private equity, preferring their Steven Tredget longer-term investment horizons, their Partner at Oakley Capital hands-on approach to management and the specific expertise they offer such as internationalisation, digitisation New investments in 2021 ## 012343567890 ### Oakley Capital Investments Annual Report 2021 35 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Case study ## Creating Europe’s favourite ## gifts and ## rewards ## platform | Wishcard, Europe’s leading gifts and | have underpinned and will continue to | | --- | --- | | rewards platform, has experienced | propel its strong growth. It has a broad | | phenomenal growth thanks to its | distribution network at the highest footfall | | market-beating combination of over 500 | locations with over 90,000 points of sale, | | redemption partners and an omnipresent | including digital vouchers sold direct | | distribution network. Wishcard’s | to consumers via its website, and 500+ | | exceptional position makes it well-placed | redemption partners, which offers so | | to take advantage of a growing global | much choice to customers. | market worth €200 billion today and enjoys several, crucial advantages which Portfolio company: Wishcard Technologies Group ### Oakley Capital Investments Annual Report 2021 36 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## 0 Funds overview Oakley funds ## Total realised OCI is a listed investment company providing consistent, long-term returns | | | Oakley Origin Fund | Oakley Fund II | | --- | --- | --- | --- | | gross returns | in excess of the FTSE All-Share Index | | | | | | Fund size: €458m | Fund size: €524m | by investing in the Funds managed by ## 1 Oakley Capital, thereby capturing the OCI commitment: €129m OCI commitment: €190m ## of3.4x Money outperformance of a leading private OCI outstanding OCI outstanding equity manager. commitment: £97m commitment: £11m ## Multiple and Oakley leverages its unique business founder network to source attractive ## 70% average investment opportunities and then ## 2 ### Oakley Fund IV Oakley Fund I applies proven value creation strategies to accelerate sustainable growth. Fund size: €1,460m Fund size: €288m ## realised gross Total outstanding commitments to OCI commitment: €400m OCI commitment: €202m Oakley Funds were £404 million at ## IRR across all OCI outstanding OCI outstanding the year-end. In January 2022, OCI commitment: £208m commitment: £2m announced an initial €400 million ## 3 ## Funds commitment (£336 million) to Fund V, the successor to Oakley Capital Fund ### IV, which is effectively c.75% invested. Oakley Fund III This will be deployed in new Fund Fund size: €800m investments over the next five years, OCI commitment: €326m funded with existing balance sheet | 0 4 | | | | --- | --- | --- | | | cash as well as expected proceeds from | OCI outstanding | | | future realisations. | commitment: £86m | ## 0 5 1 ## Investments in 2021Proceeds in 2021 ## 0 0 0 6 2 1 ## £ £ mm ## 2 7 1 3 1 1 Oakley Funds overview ## 2 2 2 3 4 8 ## 3 3 3 4 9 5 ## 4 4 4 0 5 6 ## 5 5 5 6 7 ## 6 6 6 7 8 ## 7 7 7 8 9 ## 8 8 8 0 9 ## 9 9 0 9 ## 0 0 0 ### Oakley Capital Investments Annual Report 2021 37 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## 0 ## 1 ### Oakley Origin Fund Fund size: €458m ### Fund size ## Oakley Origin Fund ### Oakley Fund IV ### Vintage: 2021 ## 2 Fund size: €1,460m The Origin Fund launched during 2021 with €458 million ### Oakley Fund III of commitments and is Oakley’s first vehicle focused on ## €458m Fund size: €800m investing in lower mid-market companies, building on the firm’s successful history of investing in this segment. ## 0 3 ### Oakley Fund II Fund size: €524m OCI commitment OCI outstanding commitment Outstanding OCI commitment as a % of NAV ### Oakley Fund I | | | | €129m | £97m | | | --- | --- | --- | --- | --- | --- | | 4 0 | 1 | | | | | | | | Fund size: €288m | | | 10% | ## 5 2 1 Current investments ## 6 3 2 ## 4 7 3 ## Oakley Funds overview ## 8 5 4 ## 6 9 5 ## 0 7 6 ## 8 7 ## 9 8 ## 0 9 ## 0 ## 0 ## 1 ### Oakley Capital Investments Annual Report 2021 38 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## 2 ## 3 ### Oakley Origin Fund Fund size: €458m ### Fund size ## Oakley Fund IV ### Oakley Fund IV ### Vintage: 2019 ## 0 4 Fund size: €1,460m Fund IV was launched during 2019 with €1,460 million ### Oakley Fund III of commitments. Fund IV is c.75% effectively ## €1,460m Fund size: €800m invested and made its first distribution during the year. ## 5 1 ### Oakley Fund II Fund size: €524m OCI commitment OCI outstanding commitment Outstanding OCI commitment as a % of NAV ### Oakley Fund I | | | €400m | £208m | | | --- | --- | --- | --- | --- | | 0 6 2 | | | | | | | Fund size: €288m | | | 22% | ## 3 7 1 Current investments ## 4 8 2 ## 0 9 5 3 ## Oakley Funds overview ## 0 6 4 1 ## 7 5 2 ## 8 6 3 ## 9 4 7 ## 0 8 5 ## 9 6 ## 0 7 ## 8 ## 9 ## 0 ## 0 0 ## 1 1 ### Oakley Capital Investments Annual Report 2021 39 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## 0 2 2 ## 3 3 1 ### Oakley Origin Fund Fund size: €458m ### Fund size ## Oakley Fund III ### Oakley Fund IV ### Vintage: 2016 ## 4 4 2 Fund size: €1,460m Fund III launched in 2016 with €800 million of commitments. ### Oakley Fund III The Fund’s investment period closed in 2019 and the Fund ## €800m Fund size: €800m is now in its realisation phase, with a number of refinancings and exits during the year. ## 5 5 3 ### Oakley Fund II Fund size: €524m OCI commitment OCI outstanding commitment Outstanding OCI commitment as a % of NAV ### Oakley Fund I | | | €326m | £86m | | | --- | --- | --- | --- | --- | | 4 6 6 | | | | | | | Fund size: €288m | | | 9% | ## 7 7 5 5.5x 120% Realised gross Money Multiple Realised gross IRR Current investments ## 8 8 6 ## 9 9 7 ## Oakley Funds overview ## 0 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 40 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ### Oakley Origin Fund Fund size: €458m ### Fund size ## Oakley Fund II ### Oakley Fund IV ### Vintage: 2013 Fund size: €1,460m Fund II was Oakley’s second fund and is now in the ### Oakley Fund III latter stages of its realisation phase, with two investments ## €524m Fund size: €800m remaining, North Sails and Daisy Group. ## 0 ### Oakley Fund II Fund size: €524m OCI commitment OCI outstanding commitment Outstanding OCI commitment as a % of NAV ### Oakley Fund I | | | | €190m | £11m | | | --- | --- | --- | --- | --- | --- | | 0 | 1 | | | | | | | | Fund size: €288m | | | 1% | ## 2 1 3.1x 59% Realised gross Money Multiple Realised gross IRR Current investments ## 2 0 3 ## 3 4 1 ## Oakley Funds overview ## 4 2 5 ## 5 6 3 ## 6 4 7 ## 7 8 5 ## 8 6 9 ## 9 0 7 ## 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 41 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## 0 0 ## 1 1 ### Oakley Origin Fund Fund size: €458m ### Fund size ## Oakley Fund I ### Oakley Fund IV ### Vintage: 2007 ## 2 2 Fund size: €1,460m Oakley’s first fund closed in 2009 and now has ### Oakley Fund III one remaining investment, Time Out Group Plc. ## €288m Fund size: €800m ## 3 3 ### Oakley Fund II Fund size: €524m OCI commitment OCI outstanding commitment Outstanding OCI commitment as a % of NAV ### Oakley Fund I | | | €202m | £2m | | | --- | --- | --- | --- | --- | | 4 4 | | | | | | | Fund size: €288m | | | 0% | ## 5 5 2.9x 44% Realised gross Money Multiple Realised gross IRR Current investments ## 0 6 6 ## 7 7 1 ## Oakley Funds overview ## 8 8 2 ## 9 9 3 ## 0 0 4 ## 5 ## 6 ## 7 ## 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 42 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## OCI NAV overview ## OCI’s NAV grew from £728 million to ## 0 ## £961 million, 538 pence per share, an ## increase of 32% since 31 December 2020 ## 0 1 | 2 1 | | | | | --- | --- | --- | --- | | | Oakley Fund Investments | Direct Investments | Cash and Other | | | Oakley Fund Investments made up 65% | Direct Investments made up 18% of NAV | Cash and Other made up 17% of NAV | | 0 3 2 | of NAV at year-end | at year-end | at year-end | ## 0 0 4 3 1 ## £629m £170m £163m | 4 2 5 | 1 1 | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | 2021 | | | | 2021 2021 | | | | | | | | | | £629m | | | £170m £163m | | | | | 2020 | | | | 2020 2020 | | | | | 6 3 2 2 5 | | | | | | | | | | | | | | £355m | | | | £150m £223m | | | | | | 2019 | | | | 2019 2019 | | | | | | | | | £420m | | | | | £241m £25m | | 0 4 3 6 3 7 | | | | | | | | | | ## 0 4 4 8 5 7 1 ## 0 2 6 5 9 0 5 8 1 ## 0 3 6 6 9 2 7 1 1 ## 4 0 3 8 7 7 2 2 ## 4 5 8 9 8 3 3 ## 6 0 4 9 9 5 4 ## 0 0 7 6 5 5 ## 8 6 7 6 ## 9 8 7 7 ## 0 9 8 8 ## 0 9 9 ## 0 0 ### Oakley Capital Investments Annual Report 2021 43 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## OCI NAV overview ### Proceeds Investments ### OCI’s look-through share of proceeds from exits, During the period, Oakley continued to originate proprietary ### refinancings and debt repayments during the period opportunities for its Funds across its focus sectors. OCI made a ### amounted to £121 million, consisting of: total look-through investment of £137 million attributable to: ## 0 Realisations Refinancings New investments Follow-on investments ## 1 ## £38m £83m £106m £31m | | | Exit of ACE Education, the | IU Group, Contabo and 7NXT | idealista, Dexters and | WindStar Medical in Fund IV; | | --- | --- | --- | --- | --- | --- | | 0 2 0 | | | | | | | | | partial sale of Daisy Group’s | all completed refinancings, | ICP Education in Fund IV; | Grupo Primavera and Globe- | | | | stake in the Digital Wholesale | demonstrating the quality of | ECOMMERCE ONE, Seedtag, | Trotter in Fund III; and North | | | | Solutions division and the | their recent earnings growth | and a reinvestment in ACE | Sails in Fund II and as a direct | | 3 | 1 1 | | | | | | | | repayment of debt by Daisy | | Education in the Origin Fund | investment | Group ## 4 0 2 2 ## 5 3 3 1 ## 4 6 4 2 ## 0 0 7 5 0 3 5 ## 8 6 4 6 1 1 1 ## 0 9 7 0 2 5 2 7 2 ## 0 8 3 6 3 3 8 1 1 ## 9 2 4 4 4 9 7 2 ## 0 3 5 0 8 5 5 3 ## 4 6 4 9 6 6 ## 0 5 7 5 7 7 ## 6 8 8 8 6 ## 7 9 9 9 7 ## 0 8 0 0 8 ## 9 9 ## 0 0 ### Oakley Capital Investments Annual Report 2021 44 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## OCI NAV overview ### Movement in NAV ## 0 Increase in NAV during the year driven by ### Movement in ## unrealised gains of £266 million ### investments ## 1 ### Portfolio ### Movement in NAV (£m) ### companies ## 2 ## £249m Net earnings in 2021 Net earnings ## 3 1200 265.9 (9.1) (8.1) (7.2) ## 4 1000 961.5 800 10.0 (18.0) 728.0 ## 0 5 600 400 ## 6 1 200 0 | | FY20 | Direct debt | | Realised | Unrealised | | | | DividendsOther income/ | | FY21Share | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | income | gains/ | | gains/ | | (expenses) | | buy-backs | | | 7 2 0 | | | | | | | | | | | | | | | | | (losses) | | (losses) | inc. FX on cash | | | | | See ‘Attribution analysis’ definition within the Glossary for an explanation of methodology ## 8 3 1 ## 9 4 2 ## 0 5 3 ## 6 4 ## 7 5 ## 8 6 ## 9 7 ## 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 45 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## OCI NAV overview ### Movement in NAV ## Increase in NAV during the year driven by ### Movement in ## unrealised gains of £266 million ### investments ## 0 ### Portfolio ### Movement in the value ### companies ### of investments (£m) ## 1 ## £248m Realised and unrealised gains on investments Realised and unrealised gains/(losses) ## 2 1000 68.3 232.0 ## 3 800 798.7 10.0 (18.0) (34.4) 113.4 (77.7) 600 ## 0 4 505.1 400 200 ## 5 1 0 | | DistributionsPurchasesFY20 | Direct | Realised | Unrealised: | | Unrealised: | | | FY21Unrealised: | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | debt | gains/ | | FX | | EBITDA | Multiple | | | 6 2 0 | | | | | | | | | | | | | income | (losses) | | | | | | | See ‘Attribution analysis’ definition within the Glossary for an explanation of methodology ## 3 7 1 ## 4 8 2 ## 9 5 3 ## 0 6 4 ## 7 5 ## 8 6 ## 9 7 ## 0 8 ## 9 ## 0 ### Oakley Capital Investments Annual Report 2021 46 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## OCI NAV overview ### Movement in NAV ## Increase in NAV during the year driven by ### Movement in ## unrealised gains of £266 million ### investments ### Portfolio ### The below chart summarises the largest movements in ### companies ### realised and unrealised gains/(losses) of the portfolio ### companies during the period on a look-through basis 91.9 42.8 18.0 15.2 15.2 15.0 13.8 IU Group 91.9 12.6 | | | | | | | | | | | | | TechInsights | | | | | | | 42.8 | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | IU Group | | | | | | | | | | 91.9 | | | | | | | | | 11.2 | | | | | | | | | | | | Wishcard Technologies Group | | | | | | | | | 18.0 | | | | | | | | | | | TechInsights | | | | | 42.8 | | | | | | | | | | | | | | 8.2 | | | | | | | | | | | | | | | | | Dexters | | | | 15.2 | | | | | | | | | Wishcard Technologies Group | | | | | | | 18.0 | | | | | | | | | | | | | | | 7.9 | | | | | | | | | | | | | | | | | Contabo | | | | 15.2 | | | | | | | | | | | | | Dexters | | 15.2 | | | | | | | | | | | | | | | 4.3 | | | | | | | | | | | | | | | | | | idealista | | | | 15.0 | | | | | | | | | | | | | Contabo | | 15.2 | | | | | | | | | | | | | | -4.8 | | | | | | | | | | | | | | | | | Time Out Group plc | | | | | 13.8 | | | | | | | | | | | | | | idealista | | 15.0 | | | | | | | | | | | | | | -5.6 | | | | | | | | | | | | | | | | Ocean Technologies Group | | | | | | 12.6 | | | | | | | | | | | | Time Out Group plc | | | 13.8 | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | | WebPros | | 11.2 | | | | | | | | | | | | Ocean Technologies Group | | | | 12.6 | | | | | | | | | | | | | | | | | | | Realised gains | See ‘Attribution analysis’ Facile 8.2 Unrealised gains/(losses) including FX and interest WebPros 11.2 definition within the Grupo Primavera 7.9 Glossary for an explanation Facile 8.2 of methodology | | | | | | | 7NXT | | | 4.3 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | Grupo Primavera | | | | | 7.9 | | | | | | | | | | | | | AMOS | | -4.8 | | Realised gains | | | 7NXT | | | 4.3 | | | | | | Unrealised gains/(losses) including FX and interest | | | | | | | | Daisy | | -5.6 | | | | | AMOS | | -4.8 | | | | | | | | | | | | | | | £m | -20 -10 0 10 20 30 40 50 60 70 80 90 100 | | | | | | Daisy | | -5.6 | | | | | | | | | | £m | -20 -10 0 10 20 30 40 50 60 70 80 90 100 | | | | | | | | | OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # OCI NAV overview ## Commitments At the year-end, OCI had £404 million of outstanding commitments to the Oakley Funds. Funds I, II and III are in their realisation phase, with future commitments to these Funds expected to be drawn primarily for follow-on investments in Fund III. OCI had no debt, and cash on the balance sheet of £163m at year-end, resulting in outstanding commitments net of cash of £241 million, or 25% of NAV. Following the year-end, OCI announced an initial €400 million commitment (£336 million) to Fund V, the successor to Oakley Capital Fund IV, which is effectively c.75% invested. Fund - Fund I - Fund II – Master - Fund III – Master - Fund IV – Master - Origin Fund – Master Outstanding £m Cash and cash equivalents £m Net Outstanding Commitments £m * Converted to GBP at 31/12/21 FX rate. ## Outstanding commitments and liquid resources (£m) ![img-5.jpeg](img-5.jpeg) ### Oakley Capital Investments Annual Report 2021 48 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## OCI NAV overview ### Funding profile of Oakley Funds The OCI commitments to the Oakley • Net cash flows: Oakley Fund ### Cash flow profile for investors in private equity funds Funds are expected to be deployed in investments have historically started new fund investments over the next to return cash during the investment five years. Following the Fund V initial period, with this cash available to fund commitment, OCI’s commitments to the future cash requirements. Therefore, the Net cash inflows offsetting Oakley Funds were £740 million. net cash funding requirement may be outflows across all funds as low as c.50% of fund commitments, These commitments are expected to be based upon historical performance. funded through the following means: • Uncalled commitments: Oakley • Cash on the balance sheet: at year-end Funds are not expected to call all this was £163 million. commitments as the manager aims to • Proceeds from future realisations: the retain flexibility; therefore, a proportion Net cash inflowsNet cash outflows staggered profile of the Oakley Fund of commitments will remain uncalled for investments is expected to generate the duration of the Fund. Funds consistent and ongoing proceeds for • Credit facilities: OCI currently does not OCI as the Funds progress through Time have any debt, but has the potential to their life cycle. Fund’s I and II are in the obtain debt facilities in the future. latter stages of their lifecycle, while Fund III is within its realisation phase It is important for the Board to strike and is expected to generate significant the right balance between maximising proceeds over the short and medium NAV growth through commitments to, term; Fund IV is at the end of its and deployment via, the Oakley Funds, investment period and is entering the and ensuring a sufficient cash buffer is realisation phase, with first refinancing maintained. proceeds received during the year. Modelled cash flow forecasts have been | • Direct investments: at the year-end, | | stress tested to give comfort that the | | | | --- | --- | --- | --- | --- | | | direct investments were £170 million | amounts being committed are sufficient | | | | | | | Typically, an investor’s net cash flows in a private | By investing in Oakley Funds at varying stages | | | and primarily comprised debt to North | for optimal NAV growth while also | equity fund will follow a ‘J-Curve’. Capital is | of their life cycle, proceeds from older vintage | | | | | called during the ‘investment period’. The fund | funds in their realisation phase can be used to | | | Sails and equity in Time Out Plc; these | ensuring adequate liquidity to meet these | | | | | | | will then begin distributing proceeds from | fund investment in current and future funds in | | | direct investments are expected to be | future fund commitments. The OCI Board | | their investment period. | refinancings and disposals, moving into the realisation phase. During the realisation phase, realised in the short to medium term, in is, therefore, confident that it will have investors will continue to receive proceeds until line with the Board’s stated ambition to sufficient funds to meet its commitments all investments are realised. focus on Oakley Fund investments. throughout the investment horizon of the Funds. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # OCI NAV overview ## Overview of OCI's underlying investments | | Sector | Region | Year of inv | | --- | --- | --- | --- | | **Origin Fund** | | | | | 7NXT | Consumer | Germany | 2020 | | ECOMMERCE ONE | Technology | Germany | 2021 | | ACE Education | Education | France | 2021 | | Seedtag | Technology | Spain | 2021 | ### Total investments Other assets and liabilities ### OCI's investment in Origin Fund #### Fund IV | Wishcard Technologies Group | Consumer | Germany | 2019 | | --- | --- | --- | --- | | Ocean Technologies Group | Education | Norway | 2019 | | Contabo | Technology | Germany | 2019 | | WebPros | Technology | Switzerland | 2020 | | WindStar Medical | Consumer | Germany | 2020 | | idealista | Consumer | Spain | 2021 | | Dexters | Consumer | United Kingdom | 2021 | | ICP Education | Education | United Kingdom | 2021 | ### Total investments Other assets and liabilities ### OCI's investment in Fund IV OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # OCI NAV overview ## Overview of OCI's underlying investments continued | | Sector | Region | Year of inv | | --- | --- | --- | --- | | **Fund III** | | | | | atHome | Consumer | Luxembourg | 2020 | | TechInsights | Technology | Canada | 2017 | | Schülerhilfe | Education | Germany | 2017 | | IU Group | Education | Germany | 2018 | | Facile | Consumer | Italy | 2018 | | Grupo Primavera | Technology | Spain | 2019 | | Iconic BrandCo | Consumer | Italy/UK | 2019/20 | ### Total investments Other assets and liabilities ### OCI's investment in Fund III OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # OCI NAV overview ## Overview of OCI's underlying investments continued | | Sector | Region | Year of invest | | --- | --- | --- | --- | | **Fund II** | | | | | North Sails | Consumer | USA | 2014 | | Daisy | Technology | United Kingdom | 2015 | | **Total investments** | | | | | Other assets and liabilities | | | | | **OCI's investment in Fund II** | | | | | **Fund I** | | | | | Time Out | Consumer | United Kingdom | 2010 | | **Total investments** | | | | | Other assets and liabilities | | | | | **OCI's investment in Fund I** | | | | ### Oakley Capital Investments Annual Report 2021 52 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## OCI NAV overview ### Overview of OCI’s underlying investments continued Sector Region Year of investment Residual cost £m Fair value £m Time Out Consumer United Kingdom £ 39.4 Fund I Loan n/a Bermuda £ 7.1 North Sails Consumer USA £ 69.3 North Sails Apparel Consumer USA £ 54.3 Total direct investments £ 170.1 Total indirect & direct investments £ 798.7 Total cash £ 163.2 Other liabilities/debtors (£ 0.4) Total net assets £ 961.5 ### Oakley Capital Investments Annual Report 2021 53 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Technology sector ## Leading in the ## digital economy Oakley’s first investments were in TMT, Sector investments ### Oakley has built a demonstrating the firm’s early track Investment Fund OCI residual OCI fair OCI % ### successful track record | record as a tech investor. This laid the | | | 1 | | | | | --- | --- | --- | --- | --- | --- | --- | | | cost (Funds) | | | value | | of NAV | | foundations for subsequent investments | | £m | | | £m | | ### in backing technology-led in niche sectors where we excel including WebPros Fund IV 42.5 61.6 6.4 ### businesses. webhosting and cloud-based SaaS TechInsights Fund III 0.3 58.4 6.1 solutions. Grupo Primavera Fund III 33.9 43.2 4.5 2 Contabo Fund IV – 13.7 1.4 Seedtag Origin Fund 7.2 8.7 0.9 Daisy Fund II 8.4 7.5 0.8 ECOMMERCE ONE Origin Fund 5.7 5.9 0.6 Total OCI valuation 199.0 1. OCI’s residual cost represents OCI’s indirect investment through the Oakley Funds and is calculated on a look- through basis. 2. Entire cost invested in Contabo has been returned. Total % of OCI NAV ## 20.7% ### Oakley Capital Investments Annual Report 2021 54 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Case Study | Fund III first invested in TechInsights in | The integration of three bolt-on | | --- | --- | | 2017 as a carve-out from AXIO Group. | acquisitions further strengthened its | | During its period of ownership, Oakley has | position as a leader in its field, and | | supported management in transforming | today TechInsights provides syndicated | | the business model by shifting its revenue | content to blue-chip companies | | base from one-off projects to higher- | around the world. | ## Leading quality subscription revenues, growing recurring revenues from 15% at entry to 65% in 2021. Portfolio company: TechInsights ## technical ## content ## platform ## for silicon microchips ### Oakley Capital Investments Annual Report 2021 55 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Technology sector ## Our technology investment portfolio | WebPros | TechInsights | Grupo Primavera | Contabo | | --- | --- | --- | --- | | The WebPros Group comprises two of the | TechInsights is the authoritative | The largest independent provider of | A leading cloud infrastructure provider | | most widely used webhosting automation | semiconductor and microelectronics | business software in Iberia. | offering hosting services to developers and | | software platforms, simplifying the lives | intelligence platform supporting clients in | | SMEs, with over 250k customers from ~180 | Grupo Primavera continues to perform ahead of developers and web professionals the innovation and decision-making through countries. of expectations as the market environment | world over. | independent research and analysis. | | | | --- | --- | --- | --- | | | | for new customer acquisition improved with | Contabo continued to see strong growth in | | WebPros has continued to perform well in | TechInsights delivered strong performance | COVID-related uncertainty and lockdown | 2021, recording revenue and EBITDA growth | | the period ended December 2021, recording | during the year, with 2021 proving to be | restrictions easing. Group revenues for the | of 52% and 70% vs prior year, respectively. | | revenue and EBITDA growth of 21% and | an inflection point. Run rate revenues and | period were organically 12% ahead of the | In December 2021, Contabo successfully | | 23%, respectively. On a group level, the total | EBITDA were up 31% and 15% vs prior year, | prior year, largely driven by acceleration | completed a refinancing with its current | | number of licences has increased by 3% | respectively. In February 2022, Fund III exited | of SaaS revenues, which grew organically | lender Barings, following continued strong | | against last year, while average revenue per | its stake at a 131% premium to the June book | by 22% vs over the same period, driven | performance and cash generation. | | licence has increased by 12%. | value, generating gross returns of 19x MM | by strong underlying growth in the Ekon, | | | | and 82% IRR. As part of the transaction, Fund | Primavera BSS and CloudCo businesses. | | IV will acquire a majority stake, alongside CVC Growth Funds. OCI valuation £61.6m OCI valuation £58.4m OCI valuation £43.2m OCI valuation £13.7m ### Oakley Capital Investments Annual Report 2021 56 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Technology sector ## Our technology investment portfolio | Seedtag | Daisy | ECOMMERCE ONE | | --- | --- | --- | | A leader in contextual advertising in EMEA | The UK’s number one independent | A leading provider of e-commerce | | and Latin America. | provider of converged B2B | software in the DACH region. | communications, IT and cloud services. | Seedtag has recorded strong performance | | ECOMMERCE ONE has been stable since | | --- | --- | --- | | since acquisition in September 2021, with | Daisy experienced a mixed performance in | acquisition in May 2021. Revenues grew by | | gross revenues and Adjusted EBITDA up | the first nine months to 31 December 2021. | 5% in FY21 while EBITDA is broadly in line | | ~80% and ~110% vs prior year, respectively, | Overall trading for the SMB division was | with prior year as the business invested | | with growth across both channels and | resilient and in line with prior year, supported | significantly across product development, | | geographies. Since acquisition in September | by a high degree of recurring revenues. This | sales and marketing, and IT infrastructure | | 2021, the business has been focused on | was offset by a decline in DCS Business | to prepare for accelerated growth in FY22. | | investing into the product/offering suite, | Continuity and Allvotec revenues, both | The business has made significant progress | | developing the team and expanding into new | impacted by COVID-19 due to the shift to | on establishing solid group level financial | | markets such as the US. | working from home and ongoing restrictions | and KPI reporting as well as its M&A agenda, | | | impacting project implementations. However, | completing the first add-on acquisitions after | | | the DCS core EBITDA was broadly in line with | the year-end. | prior year. OCI valuation £5.9mOCI valuation £7.5mOCI valuation £8.7m ### Oakley Capital Investments Annual Report 2021 57 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Consumer sector ## Distinctive brands loved by ## consumers Since inception, Oakley has built a track Sector investments ### Oakley has a long track record of investments in online and offline Investment Fund OCI residual OCI fair OCI % ### record of investing in online | consumer brands and platforms. We have | | | 1 | | | | | --- | --- | --- | --- | --- | --- | --- | | | cost (Funds) | | | value | | of NAV | | leveraged our expertise in digitalisation | | £m | | | £m | | ### and offline brands in and M&A to build and grow D2C channels, 2 North Sails Fund II 42.9 159.1 16.6 ### the consumer sector. enabling our investments to capitalise on 2 Time Out Fund I 56.7 72.5 7.5 the value captured. idealista Fund IV 40.6 58.3 6.1 Facile Fund III 19.5 43.2 4.5 Wishcard Fund IV 15.5 38.7 4.0 Technologies Group WindStar Medical Fund IV 31.4 31.4 3.3 Dexters Fund IV 13.1 29.2 3.0 Iconic BrandCo Fund III 18.0 20.3 2.1 7NXT Origin Fund 4.6 9.7 1.0 3 | | atHome | Fund III – 7.9 0.8 | | | --- | --- | --- | --- | | | Total OCI valuation | | 470.3 | | Total % of OCI NAV | 1. OCI’s residual cost represents OCI’s indirect investment through the Oakley Funds and is calculated on a look- | | | through basis. 2. OCI’s valuation of North Sails and Time Out includes both direct and indirect investments via the Oakley Funds ## 48.9% on a look-through basis. Residual cost represents indirect investments only. 3. Entire cost invested in atHome has been returned. ### Oakley Capital Investments Annual Report 2021 58 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Case Study Alessi is an Italian design brand behind some of the world’s most iconic homeware and kitchenware. Founded in Omegna, Italy in 1921, the business is th celebrating its 100 anniversary with the third generation of the Alessi family as the helm. In 2019, Oakley invested in Alessi to help it expand internationally and online, with e-commerce sales now standing at 30% vs 19% at acquisition. The business is also a pioneer in sustainability: Alessi achieved B Corp status in 2017, a coveted recognition for its high-level commitment to the local community and its equal focus on ‘people, planet and profit’. Portfolio company: Alessi ## Values that ## design us ### Oakley Capital Investments Annual Report 2021 59 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Consumer sector ## Our consumer investment portfolio North Sails Time Out idealista Facile North Sails comprises a portfolio of A trusted global brand that inspires and The leading online real estate classifieds Italy’s leading online destination for market-leading marine brands focused on enables people to experience the best of platform in Southern Europe. consumers to compare prices for motor providing high-performance products for the city. insurance, energy, telecoms and personal In the 12-month period to 31 December 2021, | the world’s sailors and yachtsmen. | | | finance. | | --- | --- | --- | --- | | | Time Out Markets were disrupted due to | idealista reported revenue and EBITDA | | | North Sails overall had a strong year as | periods of temporary closure in line with | growth ahead of Oakley’s investment case. | Facile traded well during 2021 despite a | | it continued its recovery from COVID-19, | local government restrictions. By June 2021, | Across all three of idealista’s core markets, | number of macro challenges in Italy. For | | recording total 2021 group revenue growth | all Markets reopened and have remained | Spain, Italy and Portugal, traffic and leads are | the 12-month period, Facile generated | | of 22% vs prior year. Customer demand has | consistently open since with encouraging | at, or close to, record levels and the number | revenue and EBITDA growth of 17% and 11% | | been consistently strong across the North | initial trading. Time Out Media faced | of subscribing agents are also experiencing | vs the prior year, respectively. Facile’s core | | Sails and North Actionsports businesses, | reductions in advertising spend due to | strong growth, particularly in the Spanish | insurance vertical saw good growth in both | | and North Sails Apparel has demonstrated | lockdowns but in response the business | market. | its online and offline channels, while Gas & | | strong growth trends across all channels. | continued its focus on higher-margin digital | | Power and Mortgages had particularly strong | | NTG Masts trading was impacted by COVID- | offerings. | | performances during 2021, demonstrating | | 19 lockdowns in Q3 21. | | | the benefit of a multi-vertical offering. | OCI valuation £72.5m OCI valuation £58.3m OCI valuation £43.2mOCI valuation £159.1m ### Oakley Capital Investments Annual Report 2021 60 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Consumer sector ## Our consumer investment portfolio Wishcard Technologies Group WindStar Medical Dexters Iconic BrandCo Based in Germany, Wishcard Technologies Germany’s leading over-the-counter London’s leading independent chartered Leading consumer brands, Alessi and Globe- Group is a leading consumer technology consumer healthcare platform. surveyors and estate agents. Trotter, combined as the Iconic BrandCo. company in the gift voucher and B2B customer WindStar Medical has successfully navigated Dexters had an exceptionally strong FY21, Alessi continued its strong performance and employee incentive solutions sector. | | a challenging market over the past year, | delivering 31% top-line growth. The lettings | during 2021, generating revenue growth of | | --- | --- | --- | --- | | Wishcard has continued to deliver strong | minimising the impact on performance | business continued to show steady growth | 36% vs the prior year, including digital sales | | performance in 2021, recording full-year | and successfully completing the add-on of | (+14% yoy), driven by increase in market share | which were up 33% vs prior year. This was | | revenue growth of 68% vs the prior year. | a high-growth digital consumer business, | and rental recovery with people returning | driven by strong consumer demand for the | | The business has recorded strong growth | L.A.B. cosmetics, which wins access to | to London. The stamp duty holiday up to | brand and an improved digital and retail | | across all business segments, with particularly | the clean beauty industry where growth is | the end of June 2021 resulted in heightened | experience. Globe-Trotter YTD revenues | | impressive e-commerce sales, which more | outpacing the wider beauty market. | activity levels in the first half of the year. | continued to be impacted by COVID-19 | | than doubled vs last year. | | They remained strong in H2 21 and Dexters | travel restrictions in the important Japanese | | | | continued to perform well and gain market | market, more than offsetting the strong | | | | share. Solid performance in the first months | growth achieved elsewhere in Retail and | | | | of 2022 across both sales and lettings. | Global E-Commerce, although more recent | trading is showing early signs of recovery. OCI valuation £31.4m OCI valuation £20.3mOCI valuation £29.2mOCI valuation £38.7m ### Oakley Capital Investments Annual Report 2021 61 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Consumer sector ## Our consumer investment portfolio ## The shift to online commerce is ## accelerating as consumers embrace ## D2C channels and engage with brands ## on social media. We leverage our 7NXT atHome Germany’s market leader in online fitness A digital group comprising a portfolio of ## experience in digitalisation, marketing subscription programmes focusing on leading real estate and automotive online female customers. classifieds and financial services. ## and M&A to help companies succeed The 7NXT group has continued to perform In the 12-month period to 31 December strongly since acquisition in September 2021, atHome Group reported revenue and ## online. We help our businesses develop | 2020, primarily driven by Gymondo, its | EBITDA growth of 16% and 13% vs prior year, | | --- | --- | | largest business. In FY21, Gymondo delivered | respectively. atHomeFinance and LuxAuto | | revenue and EBITDA growth of 30% and | continue to grow strongly and remain the #1 | ## platforms, marketplaces and social 36% vs prior year, respectively, on the back of destinations for consumers in Luxembourg cost-effective subscriber growth and stable looking to take out a mortgage or buy a ## media campaigns that enable them to customer retention. second-hand car, respectively. atHome Property has continued to exhibit steady growth. Given the subscription nature of the ## engage directly with customers and revenues, it should be well-positioned for strong growth going forward. ## build brand loyalty. OCI valuation £7.9mOCI valuation £9.7m ### Oakley Capital Investments Annual Report 2021 62 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Education sector ## Securing first class ## opportunities Since investing in a premium private Sector investments ### Education is a core schools group in 2013, Oakley identified Investment Fund OCI residual OCI fair OCI % ### sector, with five investments | the opportunity to consolidate high- | | | 1 | | | | | --- | --- | --- | --- | --- | --- | --- | | | cost (Funds) | | | value | | of NAV | | quality recurring revenue bases within the | | £m | | | £m | | ### ranging from online fragmented education sector, in which 2 IU Group Fund III – 131.2 13.6 ### tertiary education and there are few assets of scale. Schülerhilfe Fund III 29.4 46.1 4.8 ### after-school tutoring to Ocean Fund IV 20.4 38.5 4.0 ### marine e-learning. Technologies Group ICP Education Fund IV 26.3 27.0 2.8 ACE Education Origin Fund 9.5 9.5 1.0 Total OCI valuation 252.3 1. OCI’s residual cost and fair value represent OCI’s indirect investment through the Oakley Funds and is calculated on a look-through basis. 2. Entire cost invested in IU Group has been returned. Total % of OCI NAV ## 26.2% ### Oakley Capital Investments Annual Report 2021 63 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Case study ## Vital software Since acquisition in 2019, Oakley has which has enabled the business to cross- transitioned Ocean Technologies Group sell new products and services to its ## aboard | (‘Ocean’) to become the leading software | customers while creating further upside | | --- | --- | | platform for the maritime industry, | for the group. Today, Ocean serves | | through a buy-and-build strategy, | almost 20,000 ships and installations | ## 20,000 ships which began with the simultaneous with comprehensive and up-to-date acquisition of two competitors, Seagull compliance, risk and safety training and and Videotel, into a single platform. software tools that ensure adherence to Oakley has supported the business to the International Maritime Organization integrate five further bolt-on acquisitions, requirements. Portfolio company: Ocean Technologies Group ### Oakley Capital Investments Annual Report 2021 64 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Education sector ## Our education investment portfolio | IU Group | Schülerhilfe | Ocean Technologies Group | | --- | --- | --- | | The largest and fastest-growing university | The leading provider of after-school | The leading provider of maritime e-learning | | group in Germany. | tutoring across Germany and Austria. | and operational software worldwide. | | IU Group continued to perform well in 2021 | Schülerhilfe has faced a challenging | Ocean delivered strong performance in | | achieving revenue and EBITDA growth of | operating environment as a result of | FY21, underpinned by the successful launch | | 62% and 68% vs prior year, respectively. | COVID-19 lockdowns and ensuing tutoring | of the Ocean Learning Platform and greater | | This growth was driven by strong student | centre closures during the first half of | bundling of its growing software product | | intake, which also increased by 34%. In | 2021, but has emerged strongly from the | suite. The continued emphasis on new product | | 2022, IU Group will focus on expanding its | lockdowns. Since the restrictions have eased, | development, coupled with the synergistic | | international and German student base and | enrolments have started to recover, with Q4 | acquisition of crew management software | | expects to surpass over 100,000 paying | 2021 enrolments materially up on 2019. | provider COMPAS, further contributed | | students. | | to Ocean’s growth, and strengthened the | Group’s ability to offer cutting-edge digital solutions to the needs of ship managers and crew worldwide. Ocean has completed seven acquisitions in total and is now the largest maritime software group globally. OCI valuation £131.2m OCI valuation £46.1m OCI valuation £38.5m ### Oakley Capital Investments Annual Report 2021 65 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Education sector ## Our education investment portfolio ## Global demand for quality, ## accessible education is growing. ## Oakley has a strong track record ICP Education ACE Education ## as one of Europe’s most prolific A leading group of nurseries throughout A French group of tertiary education the UK. business schools focused on vocational ## areas of training. private equity investors in this ICP Education (‘ICP’), which was acquired by | Fund IV in June 2021, has traded well during | ACE Education closed FY21 (August year- | | | --- | --- | --- | | the period as the business recovered from | end) in line with expectations, recording | sector. Leveraging our experience in | | the impact of COVID-19. The group delivered | revenue and EBITDA growth of 14% and | | | revenue and EBITDA growth of 48% and | 23% vs prior year, respectively. The FY22 | | ## technology, internationalisation and | 71% vs prior year, respectively. ICP made six | enrolment season closed early November, | | | --- | --- | --- | | acquisitions in 2021, taking the Group to 50 | with total enrolments up 18% against prior | | | sites in total. | year and 5% above target. Despite a slow | M&A, we have successfully grown | start to the enrolments campaign as a result of COVID-19, new students enrolled across ## offline and online platforms across the group were up 25% against the previous year, and re-enrolments up 14% against the ## prior year. primary, secondary and tertiary ## education and professional learning. OCI valuation £27.0m OCI valuation £9.5m ### Oakley Capital Investments Annual Report 2021 66 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## ESG ## ESG at OCI Energy and Diversity, equality climate change Being a responsible investor, and taking and inclusion into consideration environmental, social and governance (‘ESG’) topics, is Product design paramount to the way OCI operates. People and ## n m ## o wellbeing ## r e ## This has become ever more important i ## n ## v t over the last year, as we begin to see ## n the real effects of a changing climate, Pollution ## E and how our interconnected, globalised and waste Society world faces the ongoing challenges and communities of the pandemic, bringing to a more prominent light the social challenges we ## y ## face. The Directors believe that ensuring t Natural ## appropriate and robust assessment of resources e Product quality ## i ESG related risks and opportunities will and safety ## c lead to more robust businesses, creating ## o ## long term, sustainable value. S OCI invests solely in funds managed by Oakley, and the Directors of OCI are fully engaged in and supportive of Oakley’s approach to ESG and its ability to assess ## G both ESG risks and opportunities. Oakley ## o e ## has always considered ESG in the way v c ## e n ## r n a it operates, and formally committed to integrating ESG into the investment process when it became a signatory of the UN Principles for Responsible Investment Supply chain in 2016. Over the last year, following the management hire of a Head of Sustainability in Autumn Cybersecurity and 2020, Oakley has continued to develop data protection Fair and ethical and strengthen its integration of ESG Governance conduct into the investment process, including a management focus on due diligence practices, portfolio engagement and, more broadly, ESG at portfolio company level. ### Oakley Capital Investments Annual Report 2021 67 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## ESG ## Our Investment Adviser’s ESG policy Oakley recognises that sustainability ### Oakley supports businesses and ESG factors are increasingly integral ### within three core sectors – ### to the operations and offering of the The six principles for responsible investment businesses that the Funds invest in, as ### Technology, Consumer and well as for Oakley itself. Individuals and ### Education – providing the society as a whole are demanding more transparency of how the products and ### financial support and Incorporating services they choose to use impact ESG issues into ### operational expertise that society and the environment. This policy investment analysis ### promising entrepreneurs outlines how we as investors work with and decision-making our investee companies to responsibly Being active owners processes | and business founders | | 1 | | | --- | --- | --- | --- | | | grow businesses. | | and incorporating | | require to realise the | | | ESG issues into | We believe that investing responsibly ownership policies ### potential of their protects and creates value, beyond the and practices ## standard drivers of compliance and risk 2 ### businesses. management. We recognise that ESG factors impact our investments. We also believe that identifying, assessing and Seeking appropriate managing these factors as part of our disclosure on ESG investment process will help to create issues by the entities more successful, resilient and sustainable in which investments businesses, which in turn will generate are completed ## 3 enhanced value to society more broadly. We are committed to investing responsibly and have been a signatory to the United Nations Principles for Responsible Investment, and its six principles, since 2016. The principles, as outlined on this page, have been incorporated into Oakley’s business processes and practices. ### Oakley Capital Investments Annual Report 2021 68 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## ESG ## Our Investment Adviser’s ESG policy Oakley recognises that sustainability ### Oakley supports businesses and ESG factors are increasingly integral ### within three core sectors – ### to the operations and offering of the The six principles for responsible investment businesses that the Funds invest in, as ### Technology, Consumer and well as for Oakley itself. Individuals and ### Education – providing the society as a whole are demanding more transparency of how the products and Promoting ### financial support and services they choose to use impact acceptance and ### operational expertise that society and the environment. This policy implementation of outlines how we as investors work with the principles within ### promising entrepreneurs | | our investee companies to responsibly | | the investment | Working together | | --- | --- | --- | --- | --- | | and business founders | | 4 | | | | | grow businesses. | | industry | to enhance | | require to realise the | | | | effectiveness in | We believe that investing responsibly implementing the ### potential of their protects and creates value, beyond the principles ## standard drivers of compliance and risk 5 ### businesses. management. We recognise that ESG factors impact our investments. We also believe that identifying, assessing and Reporting on managing these factors as part of our our activities and investment process will help to create progress towards more successful, resilient and sustainable implementing the businesses, which in turn will generate principles ## 6 enhanced value to society more broadly. We are committed to investing responsibly and have been a signatory to the United Nations Principles for Responsible Investment, and its six principles, since 2016. The principles, as outlined on this page, have been incorporated into Oakley’s business processes and practices. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # ESG ## Key stories 1 ### Carbon footprint assessment In 2021, Oakley completed its first carbon footprint assessments, measuring the carbon emitted by our scope 1 and 2 operations, along with business travel (scope 3) for 2019, 2020 and 2021. Over 85% of our emissions in 2019 came from business travel. In absolute terms, Oakley's total emissions dropped by over 50% between 2019 and 2020, due primarily to a reduction in travel as a result of the pandemic. Data for 2021 is still being verified at the time of reporting, but is expected to be higher than the 2020 data, as business travel resumed. Over 94% of our emissions in 2019 came from business travel compared to 88% in 2020. Oakley is in the process of deciding how best to offset these historical emissions. Future emissions will continue to be measured annually, and we are beginning to consider how to measure the carbon footprint of our portfolio companies as well. ![img-6.jpeg](img-6.jpeg) 2 ### Diversity, equality and inclusion ('DEI') assessment 2021 also saw a focus on DEI at Oakley. Several DEI working groups were formed, a Chief People Officer joined the firm and an independent assessment of our DEI practices and culture was performed, identifying a strong and robust culture and a few focus areas for 2022. 3 ### Portfolio engagement In 2021, we further developed and strengthened our ESG-related portfolio engagement practices. A formal portfolio ESG monitoring and reporting platform was launched and all existing and new investments underwent an ESG onboarding session. In December we hosted an ESG webinar for all our management teams, discussions, trends in ESG, presenting case studies, fostering knowledge and sharing practice. ![img-7.jpeg](img-7.jpeg) ![img-8.jpeg](img-8.jpeg) ### Oakley Capital Investments Annual Report 2021 70 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## ESG ## Our Investment Adviser’s ESG policy Pre-investment Portfolio engagement and ### The approach monitoring When considering potential new Organisations the investments, we assess target Oakley is typically a control investor and, Investment Adviser ### Responsible investing companies to understand the ESG as such, we strive to be an active owner isan active member of: ### principles are part of the risks and opportunities facing the and to engage with management teams business. An initial screening exercise is to promote and encourage the adoption ### life cycle of an investment, undertaken to identify any businesses of ethical and sustainable practices and ### during origination and or sectors which may require further appropriate ESG standards. Oakley is ESG scrutiny. Additional due diligence committed to working with all of the ### screening, due diligence is conducted by the Investment Team, portfolio companies to improve ESG ### and subsequently supported by the Head of Sustainability, performance and disclosure practices to identify material topics and potential during our ownership period. ### throughout our period of red flags. If significant areas of ESG risks and opportunities are ### ownership and realisation. concern or opportunity are identified, considered at company Board meetings. further specialist due diligence may ### We seek to ensure that Investee companies are required to be undertaken with support from inform Oakley immediately should a ### relevant ESG factors are independent experts. material ESG incident occur. ### considered in all steps of ESG findings, including risks and opportunities, are included in the ### the investment process. investment documents and presented to the Investment Committee for discussion, scrutiny and final approval. ### Oakley Capital Investments Annual Report 2021 71 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Principal risks The Board has developed a set of risk management quantifiable indicators of the exposure, segmented into ## Our principal risks policies, procedures and controls, and has delegated five core categories, summarised below. the monitoring, management, mitigation and oversight During 2021, the Committee continued to monitor of these principal risks to the Risk Committee, with the ## and uncertainties emerging risks and trends that could potentially impact Audit Committee having responsibility for Valuation Risk. the business of the Company. These included risks Both the Risk Committee and Audit Committee provide relating to the recovery from COVID-19 and cyber- feedback to the Board on a regular basis. Key risks and security. uncertainties of the Company are assessed considering Clear distinction is drawn between those risks within the their impact, likelihood and the ability of the Company direct control of the Board of Directors, as compared to control or influence mitigation tactics. The Risk to risks which are monitored and overseen by means of Committee monitors detailed and, wherever possible, engagement with its advisers and service providers. Key to risk management: ### Principal risks Directly manage, control, mitigate and monitor Monitor and engage Investment Adviser for mitigation Risks categories Risks and uncertainties Potential impact OCI mitigation and positioning Valuation Valuation estimates are the key The Oakley Funds utilise a consistent valuation policy across the Funds. This is ### Financial driver of financial performance and firstly monitored by the Valuations Committee of the Investment Adviser. The ### performance subject to significant uncertainty. Oakley Funds’ average portfolio valuation multiples are considered against comparables. Backtesting of exit values against reported enterprise values is used to monitor consistency and validity of Net Asset Value (‘NAV’) estimates and is reported to the Board of the Company quarterly. Independent valuations are performed at least annually for each portfolio company. Underlying Poor performance at the portfolio Quarterly monitoring of KPIs of portfolio companies. portfolio company company level adversely affects Watchlist maintained of companies negatively impacted by COVID-19 and performance valuations and therefore NAV. regular updates provided to the Committee. Credit risk on direct Exposure to financial loss if credit The Company continues to reduce its exposure to direct debt investments. At 31 investments events occur on direct debt. December 2021, a £7 million loan to Fund I and £124 million of direct debt to the Fund II portfolio company North Sails were outstanding. The Board receives regular, detailed updates directly from the Investment Adviser on North Sails’ performance and financing to closely monitor these positions (including company performance and debt to equity ratios). These fixed rate loans mature in December 2023; this short tenor limits the interest rate exposure related to fixed rate lending. An independent valuation of the debt was obtained as at 31 December 2021. ### Oakley Capital Investments Annual Report 2021 72 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Principal risks Key to risk management: ### Principal risks continued Directly manage, control, mitigate and monitor Monitor and engage Investment Adviser for mitigation Risks categories Risks and uncertainties Potential impact OCI mitigation and positioning Private Industry-wide demand for private The Oakley Funds’ investment origination model continues to prove it can ### Financial equity market equity assets could drive up entry consistently provide access to sector-focused investments at attractive ### performance competition multiples to ‘expensive’ levels and multiples. Oakley’s entrepreneur-led approach enables exclusive access to ### continued erode fund returns or limit attractive transactions in its core sectors. The Board discusses, at least quarterly, market investment opportunities. factors impacting both investing and exit opportunities. Foreign exchange Significant movements in FX rates Due to the nature of the underlying portfolio, the Company is exposed to (‘FX’) rates impact valuations and operating movements in US dollar to euro and euro to pound sterling. expenses. Given the inherent imprecision of estimating significant cash flows (investments and realisations), the Board has opted not to implement an FX hedging strategy, although it remains under periodic review. Cash balances are held in euro and pound sterling to cover short-term cash demands, and sufficient cash reserves are held to cover expected operating expenses over a period of three years. Market Material stock market volatility The Oakley Funds observe a consistent valuation policy across the Funds in increases levels of uncertainty in which the Company invests. This is firstly monitored by the Valuations valuations estimates. Committee of the Investment Adviser. The Oakley Funds’ average portfolio valuation multiples are considered against comparables (both public and private). Changes in valuation multiples are reviewed closely by the Audit Committee and reported to and discussed with the Board and Investment Adviser. ### Oakley Capital Investments Annual Report 2021 73 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Principal risks Key to risk management: ### Principal risks continued Directly manage, control, mitigate and monitor Monitor and engage investment adviser for mitigation Risks categories Risks and uncertainties Potential impact OCI mitigation and positioning Macro-economic: Heightened global inflation, interest Debt and equity levels at the portfolio company level are reported by the ### Financial Inflation, interest rates rates and geopolitical uncertainty Investment Adviser regularly to the Board. Valuation multiples are a key metric ### performance and geopolitical may impact portfolio company monitored by the Board in its oversight of valuations estimates. ### continued events earnings, increase the cost of capital Direct debt has contractual term limits which are relatively short term, reducing and impact valuation multiples. the impact of movement in interest rates. The Board monitors and responds to geopolitical events, including the recent conflict in Ukraine. Events are assessed and additional actions taken to limit any impacts. This includes implications such as sanctions, impacts on portfolio company customers and employees, portfolio company performance and the future investment environment. Concentration Building over-concentrated The Company invests as a Limited Partner in the Oakley Funds, which in turn exposure to specific portfolio seek to invest in a portfolio of underlying investments. Each Fund has companies, sectors, geographies or concentration limits as part of its investment guidelines limiting investments in investment theses increases focused individual companies. vulnerability. Reputational Significant adverse events could The Company operates in a prudent manner and has no appetite for reputational impact the Company reputation risk. The Board works closely with Oakley Investor Relations to understand resulting in negative stakeholder market sentiment and shareholder viewpoints and to consider reputational sentiment and a decreasing share exposures. The Company has in place a Code of Conduct which sets out a series price. of principles which assist in managing reputation risk. ### Oakley Capital Investments Annual Report 2021 74 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Principal risks Key to risk management: ### Principal risks continued Directly manage, control, mitigate and monitor Monitor and engage investment adviser for mitigation Risks categories Risks and uncertainties Potential impact OCI mitigation and positioning Macro event: Lack of preparedness to blind-spot Investing in a diverse portfolio of companies through the Oakley Funds ### Company Preparation and macro and geopolitical events can significantly mitigates exposure to one-off events. Regular discussion and ### performance responsiveness result in an inability to respond monitoring of the macro-economic environment and geopolitical events with adequately and on a timely basis. close involvement of Oakley in the portfolio companies provide the ability to react quickly. Sustainability Sustainability is an increasingly The Company has made the sustainability agenda a clear focus during 2021 and important factor in investing to is committed to support the Investment Adviser in further building out its create long-term value; not sustainability programme into 2022 and future years. recognising this and investing in Sustainbility is a key component of investment cycle at the Investment Adviser, high- risk assets could adversely from due diligence and management, through to exit. affect performance and reputation. Company share price Share price not reflecting NAV The Board is committed to regular and transparent reporting to enable performance performance adversely impacts shareholders to make informed decisions and believes that quarterly reporting shareholder returns. Discount to will enhance this. The discount to NAV is monitored and perceived reasons NAV is an important metric. considered. Shareholder viewpoints and Investor Relations feedback is obtained. Share buy-backs have been utilised where the Board believes it appropriate to manage the discount to NAV. Cyber security Loss of sensitive data and A register of IT and data assets is maintained both within OCI and across service ### Operational risk operational capabilities leading to providers. The Company itself has limited IT/data assets. The Risk Committee reputational and / or economic monitors compliance and control activities of service providers to understand damage. exposure, controls and occurrence of incidents. Outsourcing Significant disruption of key service The Management Engagement Committee monitors and oversees the resilience providers. and service levels of key service providers. The move of several services to Oakley in 2021 has improved operational resilience. Governance Failure to maintain an effective The Board is committed to strong and robust governance. Through its Board, key person risk, failure to respective Committees, the Board commits substantial time and resource on appropriately manage conflicts relevant topics. of interest. All Board and Committee meetings are opened with an assessment of any potential conflicts. An annual Board Effectiveness Review is undertaken. ### Oakley Capital Investments Annual Report 2021 75 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Principal risks Key to risk management: ### Principal risks continued Directly manage, control, mitigate and monitor Monitor and engage investment adviser for mitigation Risks categories Risks and uncertainties Potential impact OCI mitigation and positioning Regulatory Significant changes to regulatory The Governance, Regulatory and Compliance Committee commissioned an ### Regulatory risk compliance landscape impacting the Company independent assessment of the Company’s compliance controls and framework or its service providers. Breaches of in 2021 which confirmed the robustness of arrangements currently in place. regulatory requirements could The Board receives regular, periodic briefings from consultants on upcoming adversely impact the Company’s regulatory developments impacting the Company. ability to operate. Tax Changes to tax laws could have an The Board monitors compliance with tax laws directly impacting the Company. adverse financial or operational Further, regular updates are provided to the Board by Oakley’s Head of Tax and impact on the Company. external professional service providers. Fund commitments: Financial loss due to inability to fund The Board receives cash flow estimates, including major investment ### Liquidity risk Inability to commitments. commitments and realisation estimates on at least a quarterly basis. Minimum fund committed cash limits have been established to ensure ability to meet short-term cash capital demands. The Board also considers the need for credit facilities. Portfolio: Excess build-up of cash positions in The Company carefully considers the size of its commitments to Oakley Funds in Cash drag the Company can result in slowdown order to maximise cash deployment while balancing the liquidity risk associated of NAV growth. with over-commitment. The Company periodically considers the use of revolving credit facilities. Share buy-backs have been used to distribute excess cash where it has been attractive to do so. ### Oakley Capital Investments Annual Report 2021 76 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Stakeholder reporting Stakeholder reporting The Board is committed to understanding our stakeholders’ views and considering their interests in Board discussions, decision-making and reporting. This includes having regard to the likely consequences of any decision in the long term, the need to foster the Company’s business relationships with service providers, the impact of the Company’s operations on the community and environment, and maintaining a reputation for high standards of business conduct. Through this engagement, the Board is able to better understand stakeholders’ views and consider these views in its discussions and decision-making. Set out below are OCI’s key stakeholder groups and how the Board engages with these stakeholders. Also set out below are examples of key topics of relevance to the stakeholder group and the how their interests have been considered in decision-making. Stakeholder group How the Board engages Key topics during the year Considering stakeholder interests Shareholders | The support of our current and future | Capital Markets Day: Each year the Board | Portfolio company performance | Board decision: Agreed from Q1 | | --- | --- | --- | --- | | shareholders is critical to the continued | holds an event consisting of presentations | including the impact of COVID-19, future | 2022, OCI will issue quarterly NAV | | success of the business and the | to shareholders and analysts by senior | fund investment opportunities and deal | updates, with the first update being | | achievement of our objectives. We believe | members of Oakley. | activity. | on 27 April 2022. This is expected to | | our shareholders are interested in the | | | enhance shareholder | Shareholder engagement: The Board strong financial performance of the communications and engagement. maintains awareness of shareholder views Company, its ability to continue in by means of regular updates from its Board decision: Agreed that the 31 operation for the long term and the Investor Relations team and meetings December 2021 Annual Report and maintenance of high standards of conduct with shareholders. Accounts will be presented for the and corporate governance. The Board first time in a digital format, Website: The Company’s Annual Report places a high degree of importance on enhancing usability and helping and Accounts, along with the half-year engagement with shareholders, shareholders to more easily Financial Statements and other stock endeavouring to communicate clearly and understand OCI’s strategy, business exchange releases, are prepared in regularly with existing and potential model and results. accordance with applicable regulatory shareholders. | requirements and published on the | Board decision: During 2021, OCI | | --- | --- | | Company’s website. They are designed to | approved a redesign of its website to | | provide significant transparency and help | be launched in early 2022, alongside | | inform investors. | increased social media engagement | during 2021. This helps inform stakeholders about OCI and the broader listed private equity opportunity. ### Oakley Capital Investments Annual Report 2021 77 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Stakeholder reporting Stakeholder group How the Board engages Key topics during the year Considering stakeholder interests Oakley Capital | OCI invests in the Oakley Funds and | Regular reporting: OCI receives regular | Performance of investments, continued | Board decision: Oakley enhanced its | | --- | --- | --- | --- | | Oakley acts as the Investment Adviser. | reports from the Investment Adviser on | impact of COVID-19 on the portfolio, | Management Information (‘MI’) | | Maintaining a strong, collaborative | matters such as the performance of the | cyber security, commitments to future | reporting capability during the year, | | relationship is critical to the delivery | Funds, Investor Relations updates, as | Oakley Funds, including Fund V, FX | implementing a new system, | | of OCI’s strategy. | well as a range of other matters. | exposure and ESG. | resulting in improved and more | insightful MI. This improved MI has Continuous dialogue: The Board maintains enhanced decision-making open and constructive dialogue with the capabilities and enabled better Investment Adviser, engaging on key ‘what-if’ analysis, including enabling matters impacting both OCI and an informed decision on the level of Oakley Capital. commitment to Fund V. Face-to-face meetings: The Board and Investment Adviser meet face-to-face regularly, both for planned Board meetings as well as for ad-hoc matters. The community and environment | Being a responsible investor, and taking | Regular updates: OCI invests solely in | Diversity, equality and inclusion | Board decision: During the year, as | | --- | --- | --- | --- | | into consideration ESG topics, is central to | the Oakley Funds, with Oakley being | assessment, carbon footprint assessment | well as engaging with the Investment | | the way OCI operates. | committed to its engagement with ESG | and portfolio engagement. | Adviser on ESG initiatives, the Board | | | topics. The Board receives regular | | committed to implementing its own | | The Directors believe that ensuring | | See the ESG section of this report, | | | | updates from Oakley’s Head of | | Social Responsibility programme | | appropriate and robust assessment of | | pages 66 to 70. | | | | Sustainability and has been fully engaged | | which will focus on supporting local | ESG-related risks and opportunities will with Oakley in its progress during charities and youth programmes. lead to more sustainable business, the year. This includes two financial creating long-term, ongoing value. commitments to date, with further charities under consideration. ### Oakley Capital Investments Annual Report 2021 78 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Stakeholder reporting Stakeholder group How the Board engages Key topics during the year Considering stakeholder interests Service providers OCI engages with a range of service The Board as a whole, and the Appointment, remuneration and Board decision: During the year, the providers. Ensuring effective working Management Engagement Committee performance of the key service providers. Board approved the consolidation of relationships with these service providers specifically, ensures continued dialogue Consolidation of service provision with its administration and operational is key to the implementation of OCI’s and engagement with service providers. Oakley for administration and operational services to Oakley to enhance both strategy and helps ensure the Company services. efficiency and operational continues to operate effectively. effectiveness. It is the opinion of the Board that the consolidation of service provision direct to Oakley as it relates to administration and operational services on the terms agreed is in the best interests of the Company. Section 172 Statement As set out in the AIC Code of Corporate Governance, OCI has complied with (c) the need to foster the company’s business relationships with suppliers, Section 172 of the UK Companies Act 2006 (‘Section 172’). Under Section 172, a customers and others, director of a company must act in the way he considers, in good faith, would be (d) the impact of the company’s operations on the community and the most likely to promote the success of the company for the benefit of its members environment, as a whole, and in doing so have regard (among other matters) to the following: (e) the desirability of the company maintaining a reputation for high standards of (a) the likely consequences of any decision in the long term, business conduct, and (b) the interests of the company’s employees, (f) the need to act fairly as between members of the company. ### Oakley Capital Investments Annual report 2021 79 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Governance 80 Board of Directors 107 Nomination Committee report 82 Directors’ report 109 Governance, Regulatory and Compliance Committee 88 Investment policy report 89 Statement of Directors’ 111 Remuneration Committee responsibilities report 90 Corporate Governance report 113 Remuneration report 100 Audit Committee report 114 Alternative Investment Fund 103 Risk Committee report Managers Directive 105 Management Engagement 115 Shareholder information Committee report ### Oakley Capital Investments Annual Report 2021 80 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Board of Directors ### An independent Board ### with broad relevant ### experience to support ### OCI as it grows. | Caroline Foulger | Richard Lightowler | Fiona Beck | | --- | --- | --- | | Chair | Senior Independent Director | Non-Executive Director | | Appointed to the Company’s Board in | Appointed to the Company’s Board | Non-Executive Director appointed to the | | June 2016 (and as Chair in September | in December 2019, Richard has 25 | Company’s Board in September 2020, | | 2018), Caroline has been an independent | years’ experience in public accounting, | Fiona has over 20 years’ leadership | | Non-Executive Director in the financial | previously a Partner with KPMG in | experience in listed and unlisted | | services industry since 2013. Caroline | Bermuda. He was head of the KPMG | companies within the technology, | | was previously a partner with PwC for | Insurance Group in Bermuda for almost 14 | telecoms, infrastructure and fintech | | 12 years, primarily leading the insurance | years until retiring from the firm in 2016, | sectors. Previously, she was CEO of | | practice in Bermuda and servicing listed | a member of the firm’s Global Insurance | Southern Cross Cable Networks for 14 | | clients, with 25 years’ experience in public | Leadership Team and Global Lead Partner | years, a multinational telecommunications | | accounting. Caroline is a Fellow of the | for large international insurance groups | company. She holds a Bachelor’s degree | | Institute of Chartered Accountants in | listed on the New York and London Stock | in Management Studies (Honours), is a | | England and Wales, a member of CPA | Exchanges. Richard brings with him a | Chartered Accountant (Australia and | | Bermuda and a member of the Institute | wealth of knowledge in financial services, | NZ) and is a member of the Institute of | | of Directors. Caroline is a resident of | expertise in best practice corporate | Directors (both UK and Australia). Fiona | | Bermuda. Caroline’s leadership skills | governance risk management and | is a resident of Bermuda. Her sector- | | continue to impart a culture of positive | significant transactional and regulatory | relevant experience in the technology | | change to service providers, the Board | experience. Richard is a resident of | industry, and past leadership positions, | | and its Committees. | Bermuda and is a Chartered Accountant | provides forunique perspective and | | | in England and Wales. | insights. | Current directorships of publicly listed entities Current directorships of publicly Current directorships of listed entities publiclylisted entities • Hiscox Limited • Hansa Investment Company Limited • Atlas Arteria Holdings Limited • Atlas Arteria Holdings Limited • Aspen Insurance Holdings Limited • Ocean Wilsons Holdings Limited • Ocean Wilsons Holdings Limited • Ibex Limited ### Oakley Capital Investments Annual Report 2021 81 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Board of Directors ### An independent Board ### with broad relevant ### experience to support ### OCI as it grows. | Peter Dubens | Stewart Porter | | --- | --- | | Non-Executive Director | Non-Executive Director | | Appointed to the Company’s Board | Appointed to the Company’s Board in | | in July 2007, Peter is the founder | September 2018, Stewart has over 40 | | and Managing Partner of the Oakley | years’ of operational experience, both | | Capital Group, a privately owned asset | within private equity and technology | | management and advisory group | businesses, the latter being one | | comprising private equity and venture | of Oakley’s three core sectors for | | capital operations managing over | investment. Stewart worked as Chief | | €5 billion. Peter founded the Oakley | Operating Officer of the Investment | | Capital Group in 2002 to be a best- | Adviser, Oakley Capital Limited, from | | of-breed, entrepreneurially driven UK | 2010 until his retirement in 2018. During | | investment house, creating an ecosystem | his career, Stewart has held positions | | to support the companies in which | as COO and CFO at Wilkinson Sword | | Oakley Capital invests, whether they are | and TI Group. He was a founder and | | early-stage companies or established | CFO of Pipex Communications plc and | | businesses. David Till serves as an | was instrumental in the development | | alternate Director to Peter. | and successful sale of the Pipex Group. | Stewart’s industry knowledge and Current directorships of publicly in-depth understanding of the Investment listed entities Adviser makes him invaluable in providing the Board with insights into the detailed • Non-Executive Chair of Time Out Group workings of its key service providers. plc Current directorships of publicly listed entities • None ### Oakley Capital Investments Annual Report 2021 82 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Directors’ report The Board of Directors Frequent engagement between Directors Conflict management and Oakley continued throughout the year The Board currently comprises the Chair The Directors declare on an ongoing basis as required for the purpose of considering ### Frequent and consistent and three additional Non-Executive all conflicts and potential conflicts of key decisions of the Company, and Directors. There were no changes to interest to the Board, a register of which ### engagement with key establishing key relationships. Board composition during 2021. is considered at all Board and Committee ### service providers – The Directors are kept fully informed meetings. Declaration of Directors’ All Directors, other than Peter Dubens, of investment performance and other interests is a standing Board agenda ### essential, and deliberate. are considered to be independent. Peter matters. The Board receives periodic item at the outset of each meeting. A Dubens and David Till (as alternate reporting and ad hoc additional conflicted Director is not allowed to take Director), with a team of investment and information from key service providers. part in the relevant discussion or decision operational professionals, are together and is not counted when determining primarily responsible for performing The Directors may seek independent whether a meeting is quorate. | investment advisory and operational | professional advice at the expense of the | | | --- | --- | --- | | services with respect to the Company. | Company to aid their duties. During 2021, | Peter Dubens is a shareholder and a | | | this included an independent review of the | Director of a number of the Oakley Group | The Board met formally eight times OCI Bermuda governance and compliance entities and cannot vote on any Board during 2021, with a majority of voting arrangements, in addition to legal review decision relating to these entities. directors physically present in Bermuda of Fund V fund documentation, and an for the majority of the meetings. This Each Director’s shareholding is outlined independent valuation of the direct debt increased frequency is expected to as part of the Remuneration report, and investments held by the Company. | continue in 2022 due to an increase in | | is considered for fair dealing purposes | | --- | --- | --- | | the regularity of trading updates, moving | The rules governing the appointment | as a declared interest at the time of, for | | from semi-annually to quarterly, with eight | of Directors to the Board is contained | example, share buy-backs. | | Board meetings scheduled for the 2022 | in the Company’s bye-laws, located at: | | | calendar. | https://oakleycapitalinvestments.com/wp- | | content/uploads/2020/04/Bye-laws-of- Oakley-Capital-Investments-2020.pdf The Company’s registered office and principal place of business is: Rosebank Centre 5th Floor 11 Bermudiana Road Pembroke HM 08 ### Oakley Capital Investments Annual Report 2021 83 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Directors’ report Investment management and OCL serves as the Investment Adviser Stewardship and delegation of administration and Operational Services Provider to responsibilities the Company. It is incorporated in the ### Focus on direct The Company is a self-managed Under the Operational Services UK and is authorised and regulated by Alternative Investment Fund (‘AIF’), and Agreement, the Board has delegated to ### engagement to enhance the Financial Conduct Authority for the Board has the ultimate decision to OCL substantial authority for carrying out the provision of investment advice and ### long-term shareholder invest (or take any other action) in the the day-to-day administrative functions of arranging of investments. OCL is primarily Oakley Funds or in any other manner the Company. ### value. responsible for making investment consistent with its Investment Policy. The Company exercises its own recommendations to the Company along In the ordinary course of business, it voting rights on direct equity portfolio with structuring and negotiating deals for makes decisions after reviewing the investments, which comprise only Time the Oakley Funds. recommendations provided by the Out Group plc as at the reporting date. Investment Adviser. The Directors of the Company believe Oakley has a policy of active portfolio these disintermediated arrangements For the avoidance of doubt, the Directors management and ensures that significant will continue to create the conditions to do not make investment decisions on time and resource is dedicated to every enhance long-term shareholder value behalf of the Oakley Funds, nor do they investment, with Oakley executives and, based on the Company’s overall have any role or involvement in selecting typically being appointed to portfolio objective, to achieve a high level of or implementing transactions by the company boards, in order to ensure the Company performance. The Management Oakley Funds or in the management of implementation and continued application Engagement Committee formally reviews the Oakley Funds. of active, results-orientated corporate the performance of Oakley, driving out During the course of 2021, the Company governance. OCI receives regular improvements to cost and performance consolidated its administration and feedback on these activities. outcomes. operational services providers to Oakley Capital Limited (‘OCL’) to enhance both Operational services fees efficiency and operational effectiveness. The Administrative Agent had been Both of these potentially perceived related appointed by the Company to provide ## party transactions were independently £ operational assistance and services to validated by the Company’s Financial the Board with respect to the Company’s Operational services fees and performance fees Adviser (Liberum Capital Limited), and direct investments and generally to incurred in 2021. appropriately disclosed at the time. administer the assets of the Company, asprovided for in the Operational Services Agreement. With effect from 1 January 2022, these operational services have been provided by OCL directly. No operational services fees were incurred during the year ended 31December 2021. ## 01234567890 ### Oakley Capital Investments Annual Report 2021 84 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Directors’ report Capital Markets Day Dividend policy and distributions Unless specifically authorised by shareholders, no issuance of ordinary The Board holds an annual Capital The Board has adopted a dividend policy shares on a non-preemptive basis will be ### Oakley has a policy of Markets Day in May consisting of which takes into account the forecast ## 0 0 0 made at a price less than the prevailing presentations to shareholders and profitability and underlying performance ### active portfolio NAV per ordinary share at the time of analysts by senior members of Oakley and of the Company in addition to capital issue. No such issuances are currently ### management and ensures management teams from a selection of requirements, cash flows and distributable expected. the Oakley Funds’ portfolio companies. reserves. The Company has experienced ### that significant time and | 0 | 1 1 1 | | | | | | --- | --- | --- | --- | --- | --- | | | | | | strong NAV growth in 2021 thanks to | The Company conducts share buy-backs | | | | resource is dedicated to | Public reporting | | | | | | | | the resilient nature of the Oakley Funds’ | in the market with a view to addressing | | | | | | portfolio companies’ business models | any imbalance between the supply of and | | | | every investment. | The Company’s Annual Report and | | | | | | | | and value creation strategies focused on | demand for its shares, to increase the | Accounts, along with the half-year earnings growth rather than valuation NAV per ordinary shares and/or to assist Financial Statements and other RNS ## 0 2 2 2 1 multiple expansion. in maintaining a narrow discount to NAV releases, are prepared in accordance with per ordinary share in relation to the price applicable regulatory requirements and The Company declared a final dividend at which ordinary shares may be trading. published on the Company’s website. of 2.25 pence per share in respect of the Such purchases of ordinary shares will year ended 31 December 2020, which was only be made for cash at prices below the ## 0 3 3 3 2 1 paid in April 2021. An interim dividend prevailing NAV per ordinary share. Any of 2.25 pence per share was paid by the repurchased shares will be cancelled in Company in respect of the six months to full. Directors’ powers of share issuance 30 June 2021, in October 2021. and/or buy-back will only be exercised Share capital and voting rights ## 4 4 0 4 2 3 1 if thought to be in the best interests of Share issuance and buy-backs As at the date of this report, the Companyhad: shareholders as a whole. By a special resolution passed at the July During 2021, the Company did not issue 2021 AGM, the Directors were authorised any shares. One share buy-back was to issue shares and/or sell shares from completed during the year, pursuant to ## 4 5 5 5 treasury for cash on a non-pre-emptive ## 3 2 1 which 2 million shares, or 1.9% of the total basis, provided that such authority shall shares in issue as at the beginning of 2021, be limited to the issue and/or sale of ## , , were cancelled at a price of 354.0 pence, shares of up to 5% of the issued share with an estimated positive impact on NAV ordinary shares, voting rights in issue and issued share capital capital as at the date of that meeting. ## 0 4 6 6 6 5 2 per share of one pence. ## 3 Share buy-backs during the year NAV per share | 4 6 5 7 7 7 3 | 1 | | | | | | | | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | | | | | | | | | | Buy-back | impact | | | | | Number of | | | Buy-back | price discount | | estimate | | | | Execution date/status | | shares | price (pence) | | | to NAV (%) | (pence) | 29 July 2021 2,000,000 354 20 1.0 ## 0 6 8 8 4 8 2 5 7 ## 9 9 6 9 3 8 7 5 1 ## 0 0 0 4 8 9 6 7 2 ## 0 9 8 5 3 7 ## 0 4 6 9 8 ## 0 9 5 7 ## 0 6 8 ## 9 7 ## 0 8 ## 9 ## 0 OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS ## Directors' report ### Corporate and social responsibility The Board considers the ongoing interests of shareholders and has open and regular dialogue with the Investment Adviser on the governance of the portfolio companies. Refer to pages 66-70 for further details. ### Compensation for loss of office There are no agreements between the Company and its Directors providing for compensation for loss of office that occurs because of a change of control. ### Service providers and significant agreements The following agreements and service providers are considered significant to the Company: - Oakley Capital Limited ('Oakley') as Investment Adviser, Operational Services Provider and Administrative Agent under the terms of such relevant respective agreements. - KPMG Audit Limited as appointed external Auditor. - Liberum Capital Limited as Broker and Financial Adviser. The Board maintains ongoing engagement and dialogue with its key service providers, through formal meetings and calls, as well as informal communications throughout the year. The Management Engagement Committee's role is to review on a regular basis the appointment, remuneration and performance of the key service providers to the Company, with a key focus on Oakley. The Board collectively and collaboratively promotes open and direct dialogue with service providers. ## Shareholder understanding of buy-in to its strategy is of the business. ### Substantial shareholdings As at 31 December 2021, the Company's interest of 3% or more in the voting Shareholder OCI Directors Asset Value Investors Lombard Odier Investment Managers City of London Investment Managers Hargreaves Lansdown Stockbrokers Sarasin & Partners Jon Wood and Family (Retail) Fidelity International Interactive Investor (Retail) Hawksmoor Investment Managers Barwon Investment Partners Most notably, the aggregate voting from 70% in 2019 to 66% in 2020 ### Oakley Capital Investments Annual Report 2021 86 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Directors’ report Financial prospects and position The Board considers three years as Viability statement the most appropriate time period over Strategic considerations of the In compliance with Provision 36 of the Based upon this assessment, the which to assess the long-term viability Board as it relates to financial AIC Code of Corporate Governance (the Directors confirm they have a reasonable of the Company, as required by the AIC prospects of the Company ‘AIC Code’), the Board has assessed the expectation that the Company will Code. This time period has been chosen include: prospects of the Company over a period continue in operation and meet its as a period over which the Board can in excess of the 12 months required under liabilities as they fall due over the period • Use of leverage. The Company reasonably, and with a sufficient degree the going concern assessment. of three years from the date of this report. has to date chosen not to lever its of likelihood, assess the Company’s balance sheet. The Board has considered the prospects and over which the existing Going concern sustainability and resilience of the Oakley Fund commitments will largely be • Foreign exchange risk hedging. After making enquiries and given Company’s business model over the drawn. The Company has not to date the nature of the Company and its long term, including consideration of hedged its foreign exchange The Board has established procedures investments, the Directors, after due the lasting impacts of COVID-19 and exposure due to the unpredictable which provide a reasonable basis to make consideration, conclude that the rapidly evolving uncertainty in Eastern timing and quantum of private proper judgements on an ongoing basis Company will be able to continue for the Europe, and has based its assessment equity fund capital calls and as to the principal risks, financial position foreseeable future (being a period of of the prospects of the Company on this distributions. and prospects of the Company. Regular 12 months from the date of this report). consideration. This period of assessment reporting to the Risk Committee of the • Cash management. Monitoring Furthermore, the Directors are not aware of long-term prospects is greater than the Board provides for ongoing analysis and of cash flow forecasts ensuring of any material uncertainty regarding the period over which the Board has assessed monitoring against risk appetite. the Company can meet ongoing Company’s ability to do so. theCompany’s viability. commitments to the Funds. In reaching this conclusion, the Directors • Commitment to future Oakley have assessed the nature of the Funds. Contributions based on Company’s assets and cash flow forecasts analyses of liquidity forecasts and and consider that adverse investment ## years investment opportunities. performance should not have a material The most appropriate time period over which to impact on the Company’s ability to meet • Share buy-backs. Periodically assess the long-term viability of the Company. its liabilities as they fall due. Accordingly, utilising surplus cash balances to they are satisfied that it is appropriate to implement share buy-backs for adopt a going concern basis in preparing cancellation. the Consolidated Financial Statements. ## 0 ## 1 ## 2 ## 3 ## 4 ### Oakley Capital Investments Annual Report 2021 87 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Directors’ report | Disclosure of information to the | Political donations and expenditure | Events after balance sheet date | Commitment - on 26 January 2022, | | --- | --- | --- | --- | | auditor | | | OCI announced an initial commitment | | | The Company has made no political | At the time of writing, the conflict in | | of €400 million (£336 million) to Oakley Having made enquiries of fellow Directors donations in the year and has no Ukraine has the potential to impact global Capital’s Fund V, with the initial fund close and key service providers, each of the expectation of doing so in the future. supply chains and short-term growth being on 11 February 2022. Directors confirms that: prospects for some economies. While Annual General Meeting (‘AGM’) these concerns have had minimal effect Full realisation - on 2 February 2022, • to the best of their knowledge and belief, on the Company to date, they have Oakley Fund III exited its investment in An AGM is held each year, where a there is no relevant financial information led to some volatility to markets in the TechInsights. OCI’s look-through share of separate resolution is proposed on each of which the Company’s auditor is current quarter and the future impact proceeds was £59.5 million. substantially separate issue along with the unaware; and on the company of disruption to the presentation of the Annual Report and Acquisition - on 2 February 2022, • they have taken all the steps a Director global economy arising from the conflict Accounts. All proxy votes are counted Oakley Fund IV acquired the exited might reasonably be expected to have remains uncertain and not practicable to and, except where a poll is called, the Fund III portfolio company, TechInsights, taken to be aware of relevant financial determine at this time. level of proxies lodged for each resolution alongside a co-investor. OCI’s share of information and to establish that the is announced at the meeting and is Following the year-end, the following the look-through investment was £34.5 Company’s auditor is aware of that published on the Company’s website. The events have been noted that impact the million. Fund IV funded the acquisition information. notice of AGM and related papers are sent Company’s look-through balance sheet: with a capital call from investors, of which to shareholders at least 21 working days OCI’s share was £36.6 million. Dividends – on 9 March 2022, the Board before the meeting. of Directors approved a final dividend of The Chair and the Directors can be 2.25 pence per share in respect of the On behalf of the Board. contacted through the Company financial year ended 31 December 2021. Secretary, Carey Olsen Bermuda, 5th Caroline Foulger This is due to be paid on 14 April 2022 ## 0 Floor, 11 Bermudiana Road, Pembroke Chair to shareholders registered on or before HM08, Bermuda. 25March 2022. The ex-dividend date is 9 March 2022 24March 2022. In compliance with the bye-laws of the Company, the AGM will be conducted ## 1 prior to 26 October 2022. Details of the AGM will be notified to shareholders separately to this report. ## . p ## 2 Final dividend in respect of the financial year ended 31 December 2021 ## 3 0 0 ## 4 1 1 ## 5 2 2 ## 6 3 3 ## 7 4 4 ## 8 5 5 ## 9 6 6 ## 0 7 7 ## 8 8 ## 9 9 ## 0 0 ### Oakley Capital Investments Annual Report 2021 88 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Investment policy The following summary of OCI’s From time to time, Oakley may invite one Borrowing powers of the Company investment policy has been abbreviated or more Limited Partners in the Oakley As at 31 December 2021, the Company for convenience and is qualified in its Funds to directly invest alongside the ### The Company invests in the had no outstanding borrowings, nor entirety by reference to the complete Oakley Funds on substantially the same encumbrance on any of its assets. ### Oakley Funds, focused on investment policy detailed in OCI’s terms as such Limited Partnerships. In The Company has the power to borrow prospectus. such event, Oakley would make available ### Technology, Consumer and money in any manner. However, the to the Company copies of the due The Company seeks to meet its ### Education, with a digitally Directors do not intend to borrow more diligence and analysis prepared by Oakley investment objective by investing than 25% of the net asset value of the and any other third parties in relation to ### enabled portfolio. primarily in the Oakley Funds. Company determined at the time of such direct investment opportunities. The Surplus cash resources held by the drawdown. The Company may in the Board would then determine whether Company that are not called upon by future utilise leverage when deemed or not, and to what level, the Company the Oakley Funds will be invested under appropriate by the Board. The Company should directly invest. treasury guidelines set by the Board. Risk may be required to use its investments as It is, however, the Board’s stated ambition appetite is typically limited to placing security for any borrowings which it puts to focus on investing in the Oakley Funds such funds in cash deposits or near-cash in place. moving forward. deposits. The Company is authorised to Changes to the investment policy hedge the foreign exchange exposure of Reinvestment any non-GBP cash deposit or investment. No material changes have been made to On any realisation of investments, the the Company’s investment policy during Company may reinvest funds in any of the the year. following ways: • by way of commitment to successor funds, or new funds with successor strategies; or • in cash deposits and cash equivalents. ### Oakley Capital Investments Annual Report 2021 89 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Statement of Directors’ responsibilities In preparing the Consolidated Financial The Directors are responsible for ensuring • the Consolidated Financial Statements, ### The Directors are Statements, the Directors are required to: that: prepared in accordance with IFRS, ### responsible for preparing present fairly, in all material respects, the • select suitable accounting policies and (i) proper accounting records are kept assets, liabilities, financial position and ### the Annual Report and then apply them consistently; which are sufficient to show and explain profit or loss of the Company and, taken the Company’s transactions and disclose ### Consolidated Financial • make judgements and estimates that are as a whole, are in compliance with the with reasonable accuracy the financial reasonable and prudent; requirements set out in the Bermuda ### Statements in accordance position of the Company; and Companies Act 1981 (as amended); • state whether applicable accounting ### with applicable law and (ii) the Consolidated Financial Statements standards have been followed subject to • the Annual Report includes a fair review comply with the Bermuda Companies Act ### regulations. any material departures disclosed and of the development and performance 1981 (as amended). explained in the Consolidated Financial of the business and position of the The Directors are responsible for Statements; The Directors are also responsible for Company and a description of the preparing the Annual Report and the safeguarding the assets of the Company principal risks and uncertainties the Consolidated Financial Statements in • assess the Company’s ability to continue and hence for taking reasonable steps for Company faces; accordance with applicable law and as a going concern, disclosing, as the prevention and detection of fraud and regulations. applicable, matters related to going • the Investment Adviser’s report, other irregularities. concern; and together with the Directors’ report and Bermuda company law requires the Chair’s statement, include a fair review of Directors to produce financial statements • use the going concern basis of Responsibility statement of the the information as required; and for each financial year for the benefit of accounting unless it is inappropriate to Directors in respect of the Annual shareholders. The Directors have prepared presume that the Company will continue Report • the Annual Report and Consolidated the Consolidated Financial Statements in in business. Financial Statements, taken as a whole, Each of the Directors, whose names accordance with International Financial provide the information necessary to The Company’s Consolidated and functions are listed in the Board of Reporting Standards (‘IFRS’). assess the Company’s position and Financial Statements are published on Directors section of this report, confirms performance, business model and Consistent with the common law www.oakleycapitalinvestments.com. that, to the best of his/her knowledge: strategy, and is fair, balanced and requirements to exercise their fiduciary The responsibility for the maintenance • the Annual Report includes a fair review understandable. duties, the Directors will not approve the and integrity of the website has been of the development and performance Consolidated Financial Statements unless delegated to the Operational Services of the business and the position of the they are satisfied that it presents fairly, in Provider. The work carried out by the Company, together with a description of Affirmed independently all material respects, the state of affairs of Auditor does not involve consideration the principal risks and uncertainties that and collectively by: the Company and of the profit or loss of of the maintenance and integrity of this the Company faces; the Company for the year. Caroline Foulger website and, accordingly, the Auditor Richard Lightowler accepts no responsibility for any changes Fiona Beck that have occurred to the Consolidated Stewart Porter Financial Statements since they were Peter Dubens published on the website. ### Oakley Capital Investments Annual Report 2021 90 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report (i) Peter Dubens has waived his right to The Board In accordance with the Company’s bye- ### The Board highly values the receive a Director’s fee; and laws and best practice, Directors put Caroline Foulger, Fiona Beck, Richard ### importance of its sound themselves forward for annual re-election (ii) the Company has entered into an Lightowler and Stewart Porter remain at every AGM. ### corporate governance and Administration Agreement, Operational independent, as they are free from any Services Agreement and Investment business or other relationship that could The Board’s process for the appointment ### its impact on shareholder Adviser Agreement with Oakley Capital materially interfere with their exercise of of new Directors and proposed ### value creation and Limited, which is majority owned by Peter judgement. re-appointment of existing Directors Dubens, a Director of the Company. is conducted in a manner which is ### protection. Peter Dubens nor his alternate director transparent, engaged and open. David Till vote on matters in respect of Statement of independence which they are deemed to have a potential The Nomination Committee oversees The AIC Code recommends that the Chair conflict of interest. the nomination of Board members, as Chair’s introduction to should be independent in character and outlined in the Committee’s report. In particular, the Board is responsible corporate governance judgement and free from relationships or for making investment decisions into The tenure of the current Chair, Caroline circumstances that may affect or could Good corporate governance is a Oakley Funds, service provider selection Foulger, has been set to end and/or be appear to affect his or her judgement. fundamental ingredient to the Company’s | | | and engagement, monitoring financial | considered for renewal in September | | --- | --- | --- | --- | | business. | In addition to this provision, at least half | | | | | | performance, ensuring an adequate | 2022. The Board recognises the value of | the Board, excluding the Chair, should The primary function of the Board is to system of internal controls, setting refreshing its membership regularly, and be Non-Executive Directors whom the provide leadership and strategic direction and monitoring the Company’s risk has established fixed tenure for all four Board considers to be independent of the and it is responsible for the overall appetite, and ensuring that obligations to independent Directors, which is renewable Oakley Group. management and control of the Company. shareholders are understood and met. by mutual agreement. The Nomination Committee of the Board prefers to retain Independence is determined by ensuring Through strong governance and active The Directors believe that the Board the flexibility to assess the balance of skills that, apart from receiving their fees for ongoing engagement of its key service has an appropriate balance of skills and and experience of the Board as a whole. acting as Directors or owning shares, providers, the Board delivers long-term experience, independence and knowledge Refer to the Nomination Committee Non-Executive Directors do not have sustainable value for its shareholders. of the Company to enable it to provide report for more information. any other material relationships with, effective strategic leadership and sound The Company voluntarily applies the FCA nor derive additional remuneration from governance. Listing Rules where appropriate. Listing or as a result of transactions with, the Rule 9.8.4C requires the Company to Company, its promoters, its management Directors’ terms of appointment include certain information in a single or its partners, which in the judgement The terms and conditions of appointment identifiable section of this Annual Report of the Board may affect, or could appear for Non-Executive Directors are outlined or a cross-reference table indicating to affect, the independence of their in their letters of appointment and are where this information is set out. The judgement. available for inspection at the Company’s Directors confirm that there are no registered office during normal business disclosures to be made in this regard, hours. save that: ### Oakley Capital Investments Annual Report 2021 91 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report ### The Board actively Board meetings ### oversees and challenges ### Strategic discussions on Regular reports from the The principal matters reviewed ### the effectiveness of all ### and considered by the Board during investment strategy and Investment Adviser on the ### six of its Committees. 2021 included: ### market positioning performance of the Funds ### and any direct investments ### Decisions regarding Regular reports and updates Reporting and consideration ### changes to service from Oakley’s Investor of current and emerging ### providers Relations and Oakley’s Head risks ### of Sustainability on ESG ### matters ### Review and decisions on Consideration of the Regular reports from the ### existing direct investments Company’s share price and Board’s Committees ### and exit opportunities Net Asset Value ### The Annual Report, Half- Reports and planning from Corporate matters, ### yearly Report and decision the external auditor including dividend policy ### to move to quarterly NAV and share buy-backs ### reporting in 2022 ### Oakley Capital Investments Annual Report 2021 92 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report Board training Reports from the Committees The Board considers on an ongoing • the UK Code includes provisions of the Board basis the Principles and Provisions of relating to the role of senior executive New Directors are provided with an | | | the AIC Code of Corporate Governance. | remuneration. The Board continues to | | --- | --- | --- | --- | | induction programme tailored to the | The Board has delegated specified | | | | | | The AIC Code addresses the Principles | consider this provision as not relevant | | particular circumstances of the appointee | areas of responsibility to its Committees. | | | | | | and Provisions set out in the 2018 UK | to the Company as it does not have | | and which includes being briefed fully | The terms of reference of all | | | | | | Corporate Governance Code (the ‘UK | any senior executive employees, with | | about the Company by the Chair and | Committees are available publicly on | | | | | | Code’), as well as setting out additional | remuneration of service providers being | | Senior Executives of the Investment | the Company’s website here: https:// | | | | | | Principles on issues that are of specific | actively considered and reviewed for | | Adviser. The annual Board training plan | oakleycapitalinvestments.com/about-us/ | | | | | | relevance to the Company. | appropriateness by the Management | | considers the training needs of both the | governance/. | | | Engagement Committee in an annual Board as a whole and individual Directors. The Board considers that reporting In practice, all Board members are budget approval process. consistent with the Principles of the AIC eligible to attend all Committee meetings, Board information and support Code, which has been endorsed by the • AIC Provision 24: The Board has chosen unless specifically identified conflicts are Financial Reporting Council, will provide not to adopt a fixed policy on tenure of The Board ensures it receives, in a timely deemed to require otherwise. shareholders with a market-comparable the Chair. manner, information of an appropriate The Board annually assesses each assessment of its governance programme. quality to enable it to adequately The Company’s compliance with the AIC Committee’s performance by scrutinising discharge its responsibilities. Papers are The Company has complied with all the Code principles is summarised on the output against its terms of reference provided to the Directors in advance of Principles and Provisions of the AIC Code following pages. and gauging Directors’ views of its the relevant Board or committee meeting and the relevant provisions of the UK effectiveness. Additionally, a Board The Corporate Governance report has to enable them to make further enquiries Code, except as set out below: Effectiveness Review is completed been approved by the Board. about any matter prior to the meeting, annually considering the Board as a • the UK Code includes provisions should they so wish. This also allows the Ongoing costs whole. relating to the need for an internal Directors who are unable to attend to audit function. The Audit Committee For the period ended 31 December 2021, submit views in advance of the meeting. AIC Code compliance and Board continue to consider the the Company’s ongoing charges were The Board of Directors has regular need for a dedicated internal audit or The Board has chosen to comply with the calculated as 2.22% (2020: 2.46%) of NAV. access to the Investment Adviser and assurance function as disproportionate Association of Investment Companies The calculation is based on ongoing Administrator which supports open to the business of the Company, given Code of Corporate Governance (the charges expressed as a percentage of discussion at Board meetings. the robust, independent ongoing ‘AIC Code’), as is appropriate for the the average NAV for the year. Ongoing work conducted by the Management Company’s size and listing. charges are calculated in accordance Engagement and Governance, The Association of Investment Companies with the guidelines issued by the AIC. Regulatory and Compliance Committees (‘AIC’) represents closed-ended They comprise recurring costs, including in reviewing service providers’ investment companies whose shares are the operating expenses of the Company performance, internal controls and traded on public markets. The purpose of and OCI’s share of the management fees quality. the AIC Code is to provide a framework of paid by the underlying Oakley Funds. The best practice in respect of the governance calculation specifically excludes expenses, of investment companies. gains and losses relating to the acquisition or disposal of investments, performance- related fees and financing charges. ### Oakley Capital Investments Annual Report 2021 93 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report ### Board leadership Principle A Principle B ### and purpose A successful company is led by an effective Board, whose The Board should establish the Company’s purpose, values role is to promote the long-term sustainable success of the and strategy, and satisfy itself that these and its culture are Company, generating value for shareholders and contributing aligned. All Directors must act with integrity, lead by example ### Division of to wider society. and promote the desired culture. ### responsibilities Company position and update Company position and update Long-term sustainability, strategy development and the OCI aims to provide shareholders with consistent long- Composition, financial prospects of the Company’s business model are term returns in excess of the FTSE All-Share Index by considered regularly as part of actively engaged discussions providing exposure to private equity returns, where value ### succession by the Board. can be created through market growth, consolidation and ### and evaluation performance improvement. This is premised upon the repeatedly proven value-creation Audit, risk success of the Oakley Funds, driven by earnings growth in OCI invests in Oakley Capital funds, enabling investors to underlying portfolio companies. The Board regularly engages share in the growth and performance of high-quality, private ### and internal control the Investment Adviser’s management, challenging process, European companies in attractive sectors. cost and performance. The Board actively fosters and supports a culture that The Company’s objective and investment policy is included is open to new ideas, and is able to influence its service ### Remuneration as part of this Annual Report. Refer page 2 and page 88. In providers through effective challenge. order to ensure there is continuous improvement in Board The Company is keenly focused on overseeing its Investment practices, the Nomination Committee performs an annual Adviser drive sustainability considerations throughout the effectiveness assessment of the Board and each of its investment cycle. committees, with a focus on both risks and opportunities. ### Oakley Capital Investments Annual Report 2021 94 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report ### Board leadership Principle C Principle D ### and purpose The Board should ensure that the necessary resources are in In order for the Company to meet its responsibilities to place for the Company to meet its objectives and measure shareholders and stakeholders, the Board should ensure performance against them. The Board should also establish effective engagement with, and encourage participation ### Division of a framework of prudent and effective controls, which enable from, these parties. ### responsibilities risk to be assessed and managed. Company position and update Company position and update The Board is committed to maintain the Company’s Composition, Through the work of its regular committee and Board reputation for high standards of conduct and engagement meetings, the Board ensures frequent measurement against with its shareholders and stakeholders – refer to stakeholder ### succession the Company’s objectives. The adequacy, effectiveness and engagement reporting on pages 76-78. ### and evaluation appropriateness of resources and controls are monitored and The Management Engagement Committee oversees discussed regularly at Board meetings. The Directors’ report ### Audit, risk the relationships with key service providers and ensures outlines the activities of the Board in more detail. Refer to the accountability and continuous value-add performance. ### and internal control various Board committees for the purpose and activities of The Board remains committed to transparent reporting the six committees. in all communications, including in Annual and Half-year Risk appetite is set at least annually, monitored regularly Reports, via the Company website, and by means of annual ### Remuneration and maintained within Board-approved limits. The overall shareholder meetings and Capital Markets Days. objective is to preserve value, create appetite for observed Starting from Q1 2022, the Company will be providing opportunities or inefficiencies, and monitor and manage quarterly trading updates (as opposed to semi-annually up current and emerging risks. to and including 2021), in order to keep shareholders more regularly updated on company performance. ### Oakley Capital Investments Annual Report 2021 95 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report ### Board leadership Principle F Principle G ### and purpose The Chair leads the Board and is responsible for its overall The Board should consist of an appropriate combination effectiveness in directing the Company. They should of Directors (and, in particular, independent Non-Executive demonstrate objective judgement throughout their tenure Directors) such that no one individual or small group of ### Division of and promote a culture of openness and debate. In addition, individuals dominates the Board’s decision-making. ### responsibilities the Chair facilitates constructive Board relations and the Company position and update effective contribution of all Non-Executive Directors, and ensures that Directors receive accurate, timely and clear Four of five Directors are considered independent (Caroline ### Composition, information. Foulger, Richard Lightowler, Fiona Beck and Stewart Porter). ### succession Richard Lightowler serves as Senior Independent Director, Company position and update ### and evaluation securing an available path of intermediation for shareholders Caroline Foulger, as Chair, leads the Board of Directors and other Directors, while also acting as trusted adviser and with a culture of demonstrative challenge, openness and ### Audit, risk sounding board to the Chair. accountability. She was independent at appointment, ### and internal control Peter Dubens is the founder and Managing Partner of the and is considered by the Board to remain so, as assessed Oakley Group, and hence not considered independent. The consistently with the circumstances listed in AIC Provision 13. Company implements a strict Conflicts of Interest Policy to The responsibilities of the Board are set out in the mitigate any potential interference with Directors’ exercise of ### Remuneration Company’s bye-laws, which are published on its website: judgement. https://oakleycapitalinvestments.com/wp-content/ The culture of open and honest communication and uploads/2020/04/Bye-laws-of-Oakley-Capital- forthright discussion means no individual or small group of Investments-2020.pdf Board members dominates decision-making. The number of meetings of the Board and its committees, Committees of the Board are open for other Board and the individual attendance by Directors, are reported on members to attend, which typically occurs, thus enhancing in the Nomination Committee’s report to the Board, which is transparency. included in this Annual Report. The effectiveness of the Chair is a component of the annual Board Effectiveness Review. ### Oakley Capital Investments Annual Report 2021 96 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report ### Board leadership Principle H Principle I ### and purpose Non-Executive Directors should have sufficient time to meet The Board, supported by the Company Secretary, should their Board responsibilities. They should provide constructive ensure that it has the policies, processes, information, time challenge and strategic guidance, offer specialist advice and and resources it needs in order to function effectively and ### Division of hold third-party service providers to account. efficiently. ### responsibilities Company position and update Company position and update All Directors’ other commitments are monitored, reported At the end of 2021, the Board made the decision to appoint Composition, and publicly disclosed by stock exchange announcement Carey Olsen Bermuda for corporate secretarial services, and as appropriate. A regular Board calendar is established to also moved its registered address to the Carey Olsen offices. ### succession enable relevant meeting materials to be provided in advance. ### and evaluation The Risk Committee monitors that all policies and procedures Meeting timetables allow sufficient time for for agenda items are reviewed at a minimum annually. and debate. Ad hoc meetings are arranged with advance ### Audit, risk Directors and committees of the Board have access to materials for time-sensitive matters. ### and internal control independent professional advice, at the Company’s expense, Directors have regular direct access to both senior and junior if deemed necessary and appropriate. level service provider staff. The Management Engagement The Governance, Regulatory and Compliance Committee Committee promotes and supports continuous improvement ### Remuneration commissioned an independent assessment of the Company’s from both a tactical service delivery and a high-level strategic compliance and governance arrangements during the year, engagement perspective. which confirmed the robustness of existing arrangements. During 2021, the Company consolidated its service provision The Company appointed its first employee as ‘Board Liaison for Operational Services and Administration with the existing Officer’ to support the Board in its activities. Investment Adviser, Oakley Capital Limited. Clear separation is observed between the administration function, accounting and investment advisory services. ### Oakley Capital Investments Annual Report 2021 97 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report Caroline Foulger’s position as Chair is currently due to expire ### Board leadership Principle J on 30 September 2022, approximately six years after her first ### and purpose Appointments to the Board should be subject to a formal, appointment to the Board. Due to the long-term nature of the rigorous and transparent procedure, and an effective Company’s investments in the Oakley Funds, continuity and succession plan should be maintained. Both appointments succession planning are important considerations that are ### Division of and succession plans should be based on merit and objective considered and assessed by the Nomination Committee of ### responsibilities criteria and, within this context, should promote diversity of the Board. gender, social and ethnic backgrounds and cognitive and personal strengths. ### Composition, ### Principle L Company position and update ### succession Annual evaluation of the Board should consider its composition, The Nomination Committee completes a formal due diligence ### and evaluation diversity and how effectively members work together to process on all appointments, and reviews annually the achieve objectives. Individual evaluation should demonstrate continued suitability of Directors by means of self-declaration ### Audit, risk whether each Director continues to contribute effectively. questionnaires. ### and internal control Promotion of inclusiveness, diversity and variety of Company position and update professional experience as well as personal strengths are Board and committee effectiveness is formally assessed at thoroughly incorporated in decision-making for Director ### Remuneration least annually. selection. The objective of Board diversity, inclusion and collaboration is taken into account during the Board nomination and evaluation process. ### Principle K The Board and its committees should have a combination of skills, experience and knowledge. Consideration should be given to the length of service of the Board as a whole and membership regularly refreshed. Company position and update The Board continues to consider its level of diversity of demographic, soft and hard skills, as well as a balance of appropriate experience and tenure. Each of the Directors retires and is subject to re-election at each AGM. Nomination decisions are taken by the Nomination Committee of the Board. Refer to the Directors’ report for the biography of each Director, pages 80-81. There were no changes made to Board composition in 2021. ### Oakley Capital Investments Annual Report 2021 98 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report ### Board leadership Principle M Principle O ### and purpose The Board should establish formal and transparent The Board should establish procedures to manage risk, policies and procedures to ensure the independence and oversee the internal control framework, and determine the effectiveness of external audit functions and satisfy itself on nature and extent of the principal risks the Company is willing ### Division of the integrity of financial and narrative statements. to take in order to achieve its long-term strategic objectives. ### responsibilities Company position and update Company position and update The Audit Committee considers the independence and The Risk Committee of the Board proposes annually to Composition, effectiveness of the external auditors at least annually. the Board the level of risk tolerances, balancing risk and opportunity. Risk monitoring clearly distinguishes where the ### succession The Company rigorously follows policy and procedure Board can control or set targets, or where it can monitor for ### and evaluation to ensure effectiveness of external audit and integrity of early warning signals in order to trigger engagement with Financial Statements and narrative reporting. Refer to the service providers for other potential actions. ### Audit, risk Audit Committee report on pages 100-102. Emerging risks are monitored and incorporated into the risk ### and internal control appetite framework as opportunities arise or new market or ### Principle N strategic objectives emerge on the horizon. The Board should present a fair, balanced and ### Remuneration understandable assessment of the Company’s position and prospects. Company position and update The Company’s financial position and prospects are reviewed on an ongoing basis; refer to the viability statement on page 86. This includes assessment and monitoring of emerging and principal risks relevant to the business model of the Company. The Annual and Half-year Reports in 2021 provided fair, balanced and understandable commentary on the Company’s position and prospects. ### Oakley Capital Investments Annual Report 2021 99 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Corporate Governance report ### Board leadership Principle P Principle R ### and purpose Remuneration policies and practices should be designed to Directors should exercise independent judgement and support strategy and promote long-term sustainable success. discretion when authorising remuneration outcomes, taking account of Company and individual performance, and wider ### Division of Company position and update circumstances. ### responsibilities All independent Directors of the Company, excluding Peter Company position and update Dubens, are paid a fixed Director’s fee only. Company performance, operating complexities, individual The Company has adopted a policy whereby independent ### Composition, contribution and market circumstances are all considered by Directors are required to hold shares in the Company to the the Remuneration Committee in setting Directors’ fees. ### succession value of one year’s fees within three years of appointment. ### and evaluation As at 31 December 2021, all Directors met this requirement. ### Audit, risk ### Principle Q ### and internal control A formal and transparent procedure for developing remuneration policy should be established. No Director should be involved in deciding their own remuneration ### Remuneration outcome. Company position and update The Remuneration Committee reviews market appropriateness and fairness of Director remuneration at least annually. During 2021, it was agreed to keep Directors’ fees unchanged following the external market review conducted in 2020. ### Oakley Capital Investments Annual Report 2021 100 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Audit Committee report ## Underlying business performance of ## the Oakley portfolio companies and ## the methodologies and estimates used ## in their valuation is a key focus. Richard Lightowler Chair of the Committee Other Committee members: Fiona Beck Caroline Foulger Committee Committee member member ### Oakley Capital Investments Annual Report 2021 101 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Audit Committee report The principal role of the Audit Financial reporting ### The Audit Committee Achievements in 2021 Committee is to consider the following One of the most significant risks in the ### ensures fair, balanced and matters and make appropriate • Enhanced transparency and Company’s financial statements is the recommendations to the Board to ### understandable reporting efficiency of financial reporting and valuation of the Oakley Funds and of ensure that: audit process the Company’s direct debt and equity ### of Company results • the integrity of financial reporting and investments, specifically whether those • Concluded that the year-end ### and valuations. the Annual Report, taken as a whole, is investments are fairly and consistently valuations have been effectively fair, balanced and understandable and valued. This issue is considered carefully carried out, and that investments are provides the information necessary for by the Audit Committee. fairly valued shareholders to assess the Company’s A key area of focus of the Committee is • Introduction of independent performance, business model and the underlying business performance of valuation of direct debt investments strategy; the Oakley Funds’ portfolio companies • Considered the skills and • the independence, objectivity and and the methodologies and estimates competencies in selection of a new effectiveness of the appointed used in their valuation. This is also a key lead audit partner for 2022 audit Auditor is monitored and reviewed. area of focus of the Auditor. The Committee additionally reviews Valuations are produced by the Auditor’s performance in terms the Investment Adviser and are Objectives for 2022 of quality, control and value and independently reviewed by a considers whether shareholders would • Continued oversight of the professional valuation firm. The be better served by a change of investment valuation process and Committee reviews and ensures Auditor; and methodology to ensure that NAV is continued independence of the reported fairly • the financial reporting internal control external valuation firm. The Investment systems of the Company are adequate Adviser provides detailed explanations • Improved assessment of NAV and effective. of the rationale for the valuation sensitivity to macro-economic methodologies. climate The Audit Committee met four times | during 2021. It formally reports to the | During 2021, the Board additionally | • Introduction of quarterly NAV | | | --- | --- | --- | --- | | Board on its proceedings after each | engaged the external valuation firm to | | reporting from Q1 2022 | | meeting. Attendance is summarised as | undertake an independent valuation of | | | • Implement the transition plan for part of the report by the Nomination the direct debt investments on OCI’s Audit Engagement Partner Committee of the Board. balance sheet. • Continue to provide oversight of financial reporting, internal controls and audit process ### Oakley Capital Investments Annual Report 2021 102 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Audit Committee report | The Audit Committee concluded that | KPMG Audit Limited (‘KPMG’ or the | Any non-audit work carried out by the | No material control weaknesses or | | --- | --- | --- | --- | | the year-end valuation process had | ‘Auditor’), located in Hamilton, Bermuda, | Auditor must be approved in advance | any suspicions of potential fraud | | been effectively carried out and that the | has been the Company’s Auditor since | by the Audit Committee. In deciding | were identified by the Company. The | | investments have been fairly valued. It | 2007. The Audit Committee reviews | whether to engage the Auditor for non- | Company and its key service providers | | is noted that both the valuation process | their performance annually. The Audit | audit services, the Committee considers | implement clear whistle-blowing and | | and accounting principles applied during | Committee considers a range of | the impact on independence, potential | anti-bribery and corruption policies. | | the year were materially consistent with | factors in determining the quality of | conflicts of interest, the nature of the | | The Company engages service previous years. the audit firm, including independence work being performed, the ability of providers to carry out all significant and objectivity, quality of service, the the team conducting the work and its During the year, the Audit Committee operating and financial reporting Auditor’s specialist expertise and the relationship to the audit team, and the reviewed and approved the Company’s activities. The Management Engagement level of audit fee. quantum of fees in relation to the audit Half-year Report and dividend Committee monitors the performance fee. declarations. The year ended 31 December 2021 is of all key service providers, including a the fifth and final year of the current During the year, the Audit Committee consideration of their internal controls The Audit Committee approved the audit partner’s involvement leading the approved the following non-audit and compliance activities. The Company Annual Report, confirming to the Board audit of the Company. As a result of lead services provided by KPMG: receives direct reporting from the that financial and narrative reporting is | | partner rotation requirements, a new | | service providers on internal controls, | | --- | --- | --- | --- | | fair, balanced and understandable. | | • assistance with the preparation | | | | lead audit partner will conduct the 2022 | | the identification of any weaknesses or | of Bermuda Economic Substance audit. The Audit Committee considered significant changes in process. Audit: independence and Declaration (‘ESD’) filings; and the skills, competencies, experience objectivity On behalf of the Board. • regulatory and tax updates to the and commitments in its selection of the The Committee is responsible for Board of Directors. Richard Lightowler successor lead audit partner. overseeing the relationship with Chair of the Audit Committee The Committee is satisfied that The Company concluded a the external Auditor, including (but these services do not impact Auditor comprehensive review and tender not limited to): approval of their independence or otherwise impact the process of KPMG as external auditor in remuneration; approval of their quality of the external audit. 2020 and continues to be satisfied with terms of engagement; assessing the strong team and quality of services annually their independence and Internal control and risk provided by the external auditor during objectivity; monitoring the Auditor’s management 2021. compliance with relevant ethical and The Audit Committee considers the professional guidance on the rotation potential need for an internal audit of audit partners and specialists; and function on an annual basis and has to assessing annually their qualifications, date concluded that adequate internal expertise and resources and the overall Oakley assurance processes exist to effectiveness of the audit process. satisfy and validate the adequacy of internal controls. ### Oakley Capital Investments Annual Report 2021 103 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Risk Committee report ## Effective identification, management and ## mitigation of risks is central to the Company ## achieving its strategic objectives. Fiona Beck Chair of the Committee Other Committee members: Richard Lightowler Caroline Foulger Committee Committee member member ### Oakley Capital Investments Annual Report 2021 104 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Risk Committee report Effective identification, management The Chair of the Risk Committee is ### The Risk Committee Achievements in 2021 and mitigation of risks is central to appointed by the Board of Directors. ### ensures appropriate the Company achieving its strategic The role and responsibility of the • Cyber risk review undertaken and objectives. The Board develops Chair of the Risk Committee is to set ### establishment of risk reported on during the year and maintains the Company’s risk the agenda for meetings of the Risk ### appetite, monitoring and • Risk incident report clear of any management strategy, and performs Committee and, in doing so, take material risk events for the year oversight of its implementation. responsibility for ensuring that the Risk ### management of existing Responsibility for implementation of Committee fulfils its duties under its • Increased transparency into the ### and emerging risk factors the risk management appetite, strategy, terms of reference. Company’s financial forecasts ### relevant to the Company. monitoring and reporting is delegated to by means of enhanced financial The Risk Committee met three times the Risk Committee. reporting systems at the during the year under review and has Investment Adviser level The Risk Committee has oversight of the continued to support the Board in its Company’s risk management process, oversight, monitoring and mitigation of • Expanded liquidity risk appetite including managing risk tolerances. emerging and principal risks. in a manner commensurate with The Committee is responsible for the fundraising ambitions and The Principal Risks and Uncertainties ensuring the effective application of risk opportunities envisaged by Oakley faced by the Company are described management in the operations of the in the Strategic Report on pages Company. 71-75. Note 5 to the Consolidated The Risk Committee comprises Non- Financial Statements provides detailed Objectives for 2022 Executive Directors, with support explanations of the risks associated with from resources independent of the the Company’s investments. • Ensure the risk incident report Investment Adviser. remains clear of any material risk On behalf of the Board. events for the year Fiona Beck • Enhanced reporting of macro- Chair of the Risk Committee economic and strategic risks faced by the Company • Continue to robustly and effectively challenge the portfolio monitoring and reporting process • Ensure any appropriate contingent funding is put in place to support future Fund commitments ### Oakley Capital Investments Annual Report 2021 105 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Management Engagement Committee report ## Comparative performance, ## benchmarking of fees and service ## quality were 2021 priorities, with ESG ## and diversity areas of focus in 2022. Caroline Foulger Chair of the Committee Other Committee members: Richard Lightowler Committee member ### Oakley Capital Investments Annual Report 2021 106 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Management Engagement Committee report Investment Adviser, Operational It is the opinion of the Committee ### The Management Achievements in 2021 Service Provider and Administrator that the consolidation of service ### Engagement Committee provision with Oakley is in the interests • Oversight of the remediation of all The Management Engagement of its shareholders as a whole as it ### ensures accountability, material identified service provider Committee reviewed the performance significantly improves efficiency and will development opportunities and compliance with agreements with ### continuous value-add and provide cost synergies in the future. Oakley in 2021. Other service providers • Solidified robust annual budget ### performance enhancement were considered and it was assessed Liberum Capital Limited conducted approval and challenge exercise that no specific review in 2021 was independent fairness opinions on both ### of key service providers. • Consolidated administration and required as they are less material, and these appointments, and found the operational services in a smooth they would be reviewed on rotation. commercial terms appropriate and at transition to Oakley arm’s length. Through the work of the Factors assessed by the Committee The purpose of the Committee is Management Engagement Committee, • Oversaw the transition of during the year include: to review on a regular basis the strong performance delivery for the Company Secretary appointment, remuneration and • Performance: performance of Oakley services provided was noted, with no performance of the key service was considered in light of Service material deficiencies in delivery against providers to the Company, with a Level Agreements in place for each agreed terms. Objectives for 2022 key focus on the Investment Adviser, type of service provided and overall • Materialise the benefits of who from 1 July 2021 was also the Other key service providers performance during the year. consolidated service provision Administrator, and from 1 January 2022 • The costs for services were considered In most instances, relationships with established in 2021 by means of has also been the Operational Services and benchmarked to third-party key third-party service providers focused and measured oversight Provider. comparators. are managed by employees of the • Continue to monitor the The Committee is focused on quality Investment Adviser on behalf of the • Marketing and investor relations: remuneration, performance and value in the services obtained, and Company. ongoing oversight of investor relations. and compliance with respective monitors this by means of oversight of Noting enhanced shareholder Both the Committee and Board agreements of other key service performance, assessments of internal engagement during the year despite regularly had discussions regarding providers controls and exception reporting. limited ability to engage in person. the performance of providers of • Establish enhanced terms on Fund The Chair of the Management legal, financial advisory, brokerage, • Compliance with contractual management fees with Oakley Engagement Committee is appointed by communications and administration arrangements and duties, including the Board of Directors. services. an assessment of the internal control The Management Engagement On behalf of the Board. environment. Committee met twice during the year. • ESG and diversity considerations were Caroline Foulger The Committee formally reports to the flagged as high priorities of the Board Board on its proceedings. Chair of the Management Engagement in its review for future years. Committee ### Oakley Capital Investments Annual Report 2021 107 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Nomination Committee report ## Enhanced Board Effectiveness ## Review process and continued ## effective operation of the Board and ## its committees. Caroline Foulger Chair of the Committee Other Committee members: Richard Lightowler Committee member ### Oakley Capital Investments Annual Report 2021 108 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Nomination Committee report Members of the Committee vote on the There were no changes deemed ### The Nomination Achievements in 2021 election of new candidates, following appropriate or made in the composition ### Committee ensures which appointment is recommended of the Company Board during the • Enhanced the Board Effectiveness to the full Board, and subsequently for course of 2021. ### continued effective Review process re-election at the AGM of shareholders. During the year, a formal Board ### operation of the Board • Recommended and reappointed The Board considers diversity when Effectiveness Review was undertaken Board Directors ### andits committees. making a new appointment and with the results fed back to the • Obtained shareholder support in all seeks to get a unanimous vote on the Committee and areas for development proposed re-elections at the AGM appointment of the proposed candidate. considered for 2022. Caroline, as Chair of the Board, cannot • Review of Board skills matrix The purpose of the Committee is On behalf of the Board. vote on her own appointment. during the year to facilitate the effective operation Caroline Foulger of the Board and its committees, The Company does not have a formal Chair of the Nomination Committee and to oversee appointments and policy of tenure in place but assesses Objectives for 2022 reappointments to the Board. The each Director’s role on an individual Committee oversees the process of basis based on their performance. In its • Recommend and (re-)appoint nomination and appointment of new review of the effectiveness of the Board, Board Directors on an annual basis Directors. In summary, the process the Committee monitors Board and • Obtain shareholder support in all includes, but is not limited to: Committee meeting attendance. proposed re-elections at the • reviewing the succession plans and AGM needs for the Chair of the Board • Continue to assess and improve and Directors; Board effectiveness • seeking the best available candidates considering specific criteria determined by the Board; Number of meetings attended/eligible to attend: 100% attendance across all meetings for 2021 • agreeing a short-list of candidates, Governance, considering the views of the Regulatory Company’s professional advisers; and Management and Board Audit Risk Engagement Compliance Nomination Remuneration • conducting interviews both individually Director meetings Committee Committee Committee Committee Committee Committee and inclusive of the Board as a whole. Caroline Foulger 8/8 4/4 3/3 2/2 4/4 2/2 1/1 Stewart Porter 8/8 4/4 3/3 2/2 4/4 2/2 1/1 Fiona Beck 8/8 4/4 3/3 2/2 4/4 2/2 1/1 Peter Dubens (or David Till as alternate) 8/8 4/4 3/3 2/2 4/4 2/2 1/1 Richard Lightowler 8/8 4/4 3/3 2/2 4/4 2/2 1/1 ### Oakley Capital Investments Annual Report 2021 109 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Governance, Regulatory and Compliance Committee report ## The Company welcomes and encourages the ## benefits that inclusion and diversity can bring ## to its key service providers and its Board. Fiona Beck Chair of the Committee Other Committee members: Richard Lightowler Stewart Porter Committee Committee member member ### Oakley Capital Investments Annual Report 2021 110 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Governance, Regulatory and Compliance Committee report Diversity and inclusion Regulatory and compliance ### The Governance, Achievements in 2021 The Company welcomes and The year saw continued development ### Regulatory and • Conducted bespoke training for encourages the benefits that inclusion of the Company’s economic substance ### Compliance Committee Directors on industry governance and diversity can bring to its key service in Bermuda, with the Company themes providers and its Board. The Board advancing with first steps towards local ### ensures continued believes that a wide range of experience, employment and dedicated premises. • Detailed monitoring of ongoing ### improvement to perspectives, skills and personalities obligations and Director The Committee further had an allows Directors to share varying ### governance practices, and responsibilities independent assessment conducted of perspectives and insights, helping to the Company’s Bermudan governance ### compliant conduct of the • Enhancement of OCI’s economic create an environment of balanced and and compliance arrangements, which substance in Bermuda ### Company’s business. inclusive decision-making. confirmed the robustness of its existing The Committee actively engages with practices, and identified opportunities The purpose of the Committee key service providers in relation to for marginal improvement. Objectives for 2022 includes ensuring fulfilment of diversity and inclusion, advocating for corporate governance and compliance This serves as testament to the • Promotion of diversity and change and further enhancement of the responsibilities in relation to the relevant effectiveness of additional levels inclusion agendas in key service groundwork done over the past year. codes, laws, regulations and policies of oversight and robustness in the providers and the business of the impacting the Company. The Committee further promotes the compliance control environment of the Company importance of leading by example on Company’s key service providers. In addition, key focus areas include AIC • Continuous improvement of the and encouraging inclusion, equity and mandated corporate governance best Compliance with relevant London Stock governance and compliance diversity as it relates not only to Oakley, practice, implementation of regulatory Exchange and Bermuda law obligations control and reporting framework but also to the composition of Oakley change, board training, plusdiversity is monitored on an ongoing basis, and portfolio company founders, boards and • Ensuring the Board effectively and inclusion. presented to the Committee quarterly. leadership teams. implements changes in regulation, The Committee met four times during governance and compliance Tax compliance the year. The Committee formally Governance requirements reports to the Board. Attendance is The Committee continued to ensure The Committee considered the 42 encouraged for all Board members, the Company’s tax affairs are managed provisions and 18 principles of the AIC as it serves as a forum for regulatory in line with relevant tax regulations Code of Corporate Governance (which awareness and training. and the Company’s overall approach is aligned to a significant extent with to governance and transparency. The the UK Corporate Governance Code), Committee received presentations from including observed market best practice advisers and the Investment Adviser on as it relates to the implementation the tax environment, tax compliance thereof. and overall approach. Compliance with and exceptions to the On behalf of the Board. AIC Code were reported to the Board Fiona Beck and are presented in summary as part of Chair of the Governance, Regulatory the Corporate Governance report, refer and Compliance Committee to pages 90-99. ### Oakley Capital Investments Annual Report 2021 111 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Remuneration Committee report ## Fiscally prudent unchanged remuneration for ## 2021, with continued focus on talent retention ## and attraction of experienced, diverse skill-sets. Richard Lightowler Chair of the Committee Other Committee members: Caroline Foulger Committee member ### Oakley Capital Investments Annual Report 2021 112 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Remuneration Committee report The purpose of the Committee is to The increasingly active engagement of ### The Remuneration Achievements in 2021 determine and make recommendations Board Directors directly with key service ### Committee ensures regarding the remuneration of Directors providers, Committee responsibilities • Wholesome assessment and of the Company, while ensuring no and particular challenges of attracting ### unbiased, fair and unchanged confirmation of single Director determines their own diverse high-calibre Bermuda-based existing fair remuneration ### appropriate Director remuneration. Directors will continue being considered • Continued comprehensive when determining appropriate ### remuneration. Following a comprehensive independent assurance of conflict avoidance as remuneration practices. external remuneration consultation in it relates to the remuneration of 2020 which assessed and benchmarked The Chair and members of the Directors Directors’ compensation, the Committee Remuneration Committee are appointed concluded after consideration that no by the Board of Directors amendments were deemed necessary Objectives for 2022 On behalf of the Board. during the course of2021. • Continue to actively assess and Richard Lightowler The Committee has identified and determine fair and appropriate Chair of the Remuneration Committee acknowledges the key nuance that the Directors’ remuneration nature of the Company’s business and • Attract and retain diverse, long-term outturn of its investment relevantly experienced and cycle demands long-term continuity in engaged Board Directors Board membership. This could at times appear contrary to normal standards • Assess, promote and maintain ofBoard ‘refreshment’ practices for market-relevant, fair and listed firms. appropriate means remuneration practices ### Oakley Capital Investments Annual Report 2021 113 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Remuneration Committee report Remuneration report Directors’ interests in shares ### Directors are remunerated of the Company The Non-Executive Directors who ### in the form of fixed fees served in the period from 1 January 2021 The Board has put in place a policy ### and are subject to a to 31 December 2021 received the same whereby each Director is required to annual fees as in 2020. Directors are buy and hold sufficient publicly traded ### minimum shareholding remunerated in the form of fixed fees stock in the Company to represent a ### requirement. | payable to the Director personally. No | minimum of one year’s remuneration. | | --- | --- | | fees are paid for attending meetings or | Any newly appointed Director is | | chairing Board committees. Total fees | required to purchase stock to that | | paid to Non-Executive Directors for 2021 | level within a reasonable amount of | | were £370,000 (2020: £375,000). Note, | time (less than three years) from the | | Peter Dubens serves without a fee. | date of appointment. All Directors are | in compliance with the policy. As at There are no long-term incentive 9 March 2022, Directors who are schemes provided by the Company beneficial owners of shares in the and no performance fees are paid Company are: to Directors. 9 March 8 March No Director has a service contract Director 2022 2021 with the Company and each Director is Caroline Foulger 132,000 122,000 appointed by a letter of appointment Peter Dubens 18,083,631 18,083,631 setting out the terms of their Stewart Porter 45,216 45,216 appointment. Directors are elected annually by shareholders at the AGM. Richard Lightowler 155,000 130,000 1 Fiona Beck 40,000 22,000 1 Fiona Beck was appointed in September 2020. Save as disclosed above, none of the Directors nor any member of their respective immediate families has any interest whether beneficial or non- beneficial in the share capital of the Company. ### Oakley Capital Investments Annual Report 2021 114 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Alternative Investment Fund Managers Directive Status and legal form Liquidity management Remuneration disclosure ### The Company continuously The Company is a self-managed non-UK As the Company is a self-managed The total amount of remuneration paid ### monitors liquidity to ensure Alternative Investment Fund (‘AIF’). It non-UK AIF, it is not required to comply by the Company to its Directors during ### it can fund its undrawn is a closed-ended investment company with Chapter 3.6 of the Investment the year ended 31 December 2021 was incorporated in Bermuda and its ordinary Funds sourcebook of the Financial £370,000. ### commitments. shares are traded on the Specialist Fund Conduct Authority in relation to liquidity This consisted solely of fixed Segment of the London Stock Exchange’s management. remuneration; no variable remuneration Main Market. The Company’s registered The Company maintains an adequate level was paid. Fixed remuneration was office is: 5th Floor, 11 Bermudiana Road, of liquidity to ensure that it can meet its composed of agreed fixed fees. Pembroke HM08, Bermuda. capital commitments to the Oakley Funds There were four beneficiaries of this throughout the private equity fund cycle. remuneration, with no changes to the Investment policy Cash-flow modelling is performed on an Board directorship during the year. For details of the investment policy, refer ongoing basis to enable the Company to to page 88. manage its liquid resources and to ensure it has the ability to pay commitments as they fall due, while also endeavouring to manage any surplus cash. Fees, charges and expenses For details of the fees payable by the Company, refer to Note 15 of the Notes to the Consolidated Financial Statements. Fair treatment of shareholders and preferential treatment The Company will treat all of the Company’s investors fairly and will not allow any investor to obtain preferential treatment, unless such treatment is appropriately disclosed. No investor currently obtains preferential treatment or has the right to obtain preferential treatment. ### Oakley Capital Investments Annual Report 2021 115 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Shareholder information Financial calendar Dividend Rights attaching to shares ### OCI shares can be The announcement and publication of The final dividend proposed in respect The rights attaching to the shares are ### purchased through a the Company’s results is expected in the of the year ended 31 December 2021 is set out in the bye-laws of the Company. ### stockbroker, financial months shown below: 2.25 pence per share. There are no restrictions on the transfer of ordinary shares other than those which ### adviser, bank or share- January Trading update for the year Ex-dividend date (date 24 March may be imposed by law from time to announced from which shares are 2022 ### dealing platform. time. There are no special control rights March Final results for the year transferred without in relation to the Company’s shares announced, Annual Report dividend) and the Company is not aware of any published Record date (last date for 25 March agreements between holders of securities April Payment of final dividend registering transfers to 2022 that may result in restrictions on the receive the dividend) transfer of securities or on voting rights. Publication of first quarterly Dividend payment date 14 April 2022 In accordance with the Market Abuse trading update for Q1 Regulation and the Company’s share May Capital Markets Day Important information dealing code, Board members and certain July Interim trading update Past performance is not a reliable employees of the Company’s service announced indicator of future results. The value of providers are required to seek approval to September Interim results announced, OCI shares can fall as well as rise and you deal in the Company’s shares. Interim Report published may get back less than you invested when At a general meeting of the Company, October Payment of interim dividend you decide to sell your shares. every holder of shares who is present in Q3 trading update person or by proxy shall, on a poll, have one vote for every share of which they Share dealing are the holder. All the rights attached to Investors wishing to purchase or sell a treasury share shall be suspended and shares in the Company may do so through shall not be exercised by the Company a stockbroker, financial adviser, bank or while it holds such treasury shares share-dealing platforms. To purchase and, where required by the Act, all this investment, you should read the treasury shares shall be excluded from Key Information Document (‘KID’) the calculation of any percentage or before the trade can be executed. This is fraction of the share capital or shares of available on the Company’s website at: the Company. As at 31 December 2021, https://oakleycapitalinvestments.com/ the Company did not hold any treasury wp-content/uploads/2021/08/OCI-KID- shares. Document-2021.pdf OCI shares can be purchased through a range of broker platforms including: Selftrade, Transact Online, iDealing.com, Hargreaves Lansdown, Interactive Investor, Charles Stanley Direct, AJ Bell Youinvest and ComDirect. ### Oakley Capital Investments Annual Report 2021 116 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Consolidated ## Financial Statements | 117 Independent Auditor’s Report | | 125 Consolidated statement of cash flows | | | --- | --- | --- | --- | | 122 Consolidated statement of | | 126 Notes to the Consolidated Financial | | | | comprehensive income | | Statements | | 123 Consolidated balance sheet | | 144 Directors and Advisers | | | 124 Consolidated statement | | 145 Glossary and Alternative | | | | of changes in equity | | Performance Measures | ### Oakley Capital Investments Annual Report 2021 117 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Independent Auditor’s Report To the Shareholders and Board of Directors of Oakley Capital Basis for opinion Investments Limited We conducted our audit in accordance with International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Report on the audit of the consolidated financial statements Auditor’s responsibilities for the audit of the consolidated financial statements section of our report. We are independent of the Company in accordance with Opinion International Ethics Standards Board for Accountants International Code of Ethics We have audited the consolidated financial statements of Oakley Capital for Professional Accountants (including International Independence Standards) Investments Limited and its subsidiary (the “Company”), which comprise the (IESBA Code) together with the ethical requirements that are relevant to our audit consolidated balance sheet as at 31 December 2021 and the consolidated of the consolidated financial statements in Bermuda and we have fulfilled our other statements of comprehensive income, changes in equity and cash flows for the ethical responsibilities in accordance with these requirements and the IESBA Code. year then ended, and notes, comprising significant accounting policies and other We believe that the audit evidence we have obtained is sufficient and appropriate explanatory information. to provide a basis for our opinion. In our opinion, the accompanying consolidated financial statements present fairly, Key audit matters in all material respects, the consolidated financial position of the Company as at 31 December 2021 and its consolidated financial performance and its consolidated Key audit matters are those matters that, in our professional judgment, were of cash flows for the year then ended in accordance with International Financial most significance in our audit of the consolidated financial statements of the Reporting Standards (IFRS). current period. These matters were addressed in the context of our audit of the consolidated financial statements as a whole, and in forming our opinion thereon, and we do not provide a separate opinion on these matters. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Independent Auditor's Report The key audit matter ## Valuation of the Funds As discussed in the Audit Committee report on pages 100-102, the accounting policies on pages 127-130 and in Notes 6 and 8 to the consolidated financial statements on pages 133 and 135, the Company holds investments in private equity partnerships (the "Funds") at 31 December 2021 of £628.5 million, where quoted prices do not exist. The Funds are carried at their estimated fair values based upon the principles of the International Private Equity and Venture Capital Association ("IPEV") valuation guidelines and IFRS 13. The valuation of the Funds held in the Company's investment portfolio is the key driver of its net asset value and total return to shareholders. The Funds hold equity investments in unquoted portfolio companies. The valuations of these portfolio companies are complex and require the application of judgment by Oakley Capital Limited (the "Investment Adviser"). The fair values of these portfolio companies are principally based upon the market approach, which estimates the enterprise value of the portfolio company using a comparable multiple of revenues or EBITDA, information from recent comparable transactions, or the underlying net asset value. ## The risk The significance of the Funds to the Company's consolidated financial statements, combined with the judgment required in estimating their fair values means this was an area of focus during our audit. How the matter was addressed in our audit We obtained management's schedule of investments in the Funds and performed the following: - Compared the Company's valuations to the audited financial statements at 31 December 2021; - Inspected the components of the Funds' net assets and the Funds' audited financial statements were represented; - Inspected the disclosures made about the Funds in the Company's consolidated financial statements for compliance with IFRS; and - Monitored any events that emerged in the post balance sheet (the Company's consolidated financial statements) that would have a potential effect on the Funds held at the year-end. Through our involvement in the Funds' audit engagement, the Company's consolidated financial statements held indirectly through the Company's consolidated financial statements following audit procedures: - Attended valuation meetings during the year where they were held at the end of the year from the Investment Adviser; - Obtained the Investment Adviser's models and the information provided by the Company's valuing the unquoted equity investments; - Conducted procedures to satisfy ourselves of the question of the Company's valuation specialists engaged by the Funds; - Independently sourced multiples for comparable companies from the Company's Capital Adviser, and considered whether those companies are not to be involved in the investment in investee companies and compared them to multiples; - KPMG valuation specialists challenged the Investment Adviser's assumptions used in determining the fair value of unquoted equity investments in the IPOV valuation guidelines; - Obtained management information, including forecasts and estimates of the amounts at the balance sheet date, which are the key indicators of the Company's consolidated financial statements; and compared this information; - Obtained an understanding of matters that may affect the Company's financial statements through discussions with the Investment Adviser and other financial statements and industry trends; - Obtained independent confirmations of the existence of the Company's financial statements from third parties; - Recalculated the mathematical accuracy of the valuation; - Monitored any events that emerged in the post balance sheet (the Company's consolidated financial statements) that would have a potential effect on the Funds held at the year-end. ### Oakley Capital Investments Annual Report 2021 119 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Independent Auditor’s Report The key audit matter How the matter was addressed in our audit Valuation of the unquoted debt securities We engaged KPMG valuation specialists to assist in testing the valuation of the unquoted debt securities. In coordination with our valuation specialists, we selected all unquoted debt securities held In addition to investments in the Funds, the Company holds by the Company at year end and performed the following audit procedures: investments in unquoted debt securities at 31 December 2021 of £130.7 million. • Obtained independent loan confirmations from third parties to support the completeness, existence, and accuracy of the debt securities; The fair value of the unquoted debt securities is derived using • Inspected loan agreements to support the loan terms and inputs to discounted cash flow calculation adiscounted cash flow calculation based on expected future cash flows to be received, discounted at an appropriate rate. • Obtained the Investment Adviser’s models and the independent external valuation report used for Expected future cash flows include interest received and valuing the debt securities at year end and checked their mathematical accuracy; principal repayment at maturity. • Conducted procedures to satisfy ourselves of the qualifications, independence and expertise of the external valuation specialists engaged by the Company; The risk • Performed a sensitivity analysis over the discount rates being applied to the expected cash flows in The unquoted debt securities were an area of audit focus on the fair value calculations provided to us by management; the basis that: • Challenged the reasonableness of the assumptions made by the Investment Adviser and their expert • The securities are of material significance to the Company’s regarding the timing and amounts of expected future cash flows; and consolidated financial statements; • Monitored any events that emerged in the post balance sheet period (up to the date of signing the • Judgment is required by the Investment Adviser in selection consolidated financial statements) that would have had a potential impact on the value of the of an appropriate, market related, risk-adjusted discount unquoted debt investments held at the year end. rate; and • Judgment is also required in determining the timing and amounts of prospective cash flows of the debt securities. ### Oakley Capital Investments Annual Report 2021 120 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Independent Auditor’s Report Other information in the Annual Report misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be Management is responsible for the other information contained in the Annual expected to influence the economic decisions of users taken on the basis of these Report. The other information comprises the Overview, Strategic Report and consolidated financial statements. Governance sections. As part of an audit in accordance with ISAs, we exercise professional judgment and Our opinion on the consolidated financial statements does not cover the other maintain professional skepticism throughout the audit. We also: information and we do not express any form of assurance conclusion thereon. • Identify and assess the risks of material misstatement of the consolidated financial In connection with our audit of the consolidated financial statements, our statements, whether due to fraud or error, design and perform audit procedures responsibility is to read the other information and, in doing so, consider whether responsive to those risks, and obtain audit evidence that is sufficient and the other information is materially inconsistent with the consolidated financial appropriate to provide a basis for our opinion. The risk of not detecting a material statements or our knowledge obtained in the audit, or otherwise appears to be misstatement resulting from fraud is higher than for one resulting from error, as materially misstated. fraud may involve collusion, forgery, intentional omissions, misrepresentations, or If, based on the work we have performed, we conclude that there is a material the override of internal control. misstatement of this other information, we are required to report that fact. We have • Obtain an understanding of internal control relevant to the audit in order to nothing to report in this regard. design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal Responsibilities of management and those charged with governance for the control. consolidated financial statements • Evaluate the appropriateness of accounting policies used and the reasonableness Management is responsible for the preparation and fair presentation of the of accounting estimates and related disclosures made by management. consolidated financial statements in accordance with IFRS, and for such internal • Conclude on the appropriateness of management’s use of the going concern control as management determines is necessary to enable the preparation of basis of accounting and, based on the audit evidence obtained, whether consolidated financial statements that are free from material misstatement, a material uncertainty exists related to events or conditions that may cast whether due to fraud or error. significant doubt on the Company’s ability to continue as a going concern. If we In preparing the consolidated financial statements, management is responsible conclude that a material uncertainty exists, we are required to draw attention for assessing the Company’s ability to continue as a going concern, disclosing, as in our auditor’s report to the related disclosures in the consolidated financial applicable, matters related to going concern and using the going concern basis statements or, if such disclosures are inadequate, to modify our opinion. Our of accounting unless management either intends to liquidate the Company or to conclusions are based on the audit evidence obtained up to the date of our cease operations, or has no realistic alternative but to do so. auditor’s report. However, future events or conditions may cause the Company tocease to continue as a going concern. Those charged with governance are responsible for overseeing the Company’s financial reporting process. • Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the consolidated Auditor’s responsibilities for the audit of the consolidated financial statements represent the underlying transactions and events in a manner financialstatements that achieves fair presentation. Our objectives are to obtain reasonable assurance about whether the consolidated • Obtain sufficient appropriate audit evidence regarding the financial information financial statements as a whole are free from material misstatement, whether of the entities or business activities of the Funds to express an opinion on due to fraud or error, and to issue an auditor’s report that includes our opinion. the consolidated financial statements. We are responsible for the direction, Reasonable assurance is a high level of assurance, but is not a guarantee that supervision and performance of the group audit. We remain solely responsible for an audit conducted in accordance with ISAs will always detect a material our audit opinion. ### Oakley Capital Investments Annual Report 2021 121 GOVERNANCE FINANCIALS GLOSSARY STRATEGIC REPORT ## Independent Auditor’s Report We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant audit findings, including any significant deficiencies in internal control that we identify during our audit. We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding independence, and communicate with them all relationships and other matters that may reasonably be thought to bear on our independence, and where applicable, related safeguards. From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our auditor’s report unless law or regulation precludes public disclosure about the matter or when, in extremely rare circumstances, we determine that a matter should not be communicated in our report because the adverse consequences of doing so would reasonably be expected to outweigh the public interest benefits of such communication. The purpose of our audit work and to whom we owe our responsibilities This report is made solely to the Company’s Shareholders and Board of Directors. Our audit work has been undertaken so that we might state to the Company’s Shareholders and Board of Directors those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the Shareholders and Board of Directors, as a body, for our audit work, for this report, or for the opinion we have formed. The Engagement Partner on the audit resulting in this independent auditor’s report is James Berry. Chartered Professional Accountants Hamilton, Bermuda 9 March 2022 OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Consolidated Financial Statements # Consolidated statement of comprehensive income For the year ended 31 December 2021 Income Interest income Net realised gains on investments at fair value through profit and loss Net change in unrealised gains/(losses) on investments at fair value through profit and loss Net foreign currency gains/(losses) Other income Total income Expenses Profit attributable to equity shareholders/total comprehensive income Earnings per share Basic and diluted earnings per share The Notes on pages 126 to 143 are an integral part of these Consolidated Financial Statements. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Consolidated Financial Statements ## Consolidated balance sheet As at 31 December 2021 Assets Non-current assets Investments Current assets Trade and other receivables Cash and cash equivalents Total assets Liabilities Current liabilities Trade and other payables Total liabilities Net assets attributable to shareholders Equity Share capital Share premium Retained earnings Total shareholders' equity Net asset per ordinary share Basic and diluted net assets per share Ordinary shares in issue at 31 December ('000) The Notes on pages 126 to 143 are an integral part of these Consolidated Financial Statements. The Consolidated Financial Statements of Oakley Capital Investments Limited (registration number: 40324) on pages 12 and authorised for issue on 9 March 2022 and were signed on their behalf by: Caroline Foulger Director Richard Lightowler Director ### Oakley Capital Investments Annual Report 2021 124 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Consolidated Financial Statements ## Consolidated statement of changes in equity For the year ended 31 December 2021 Total | | Share | | Share | Retained | | shareholders’ | | | --- | --- | --- | --- | --- | --- | --- | --- | | | capital | premium | | earnings | | | equity | | Notes | £’000 | | £’000 | | £’000 | | £’000 | Balance at 1 January 2020 1,986 229,728 454,294 686,008 Profit for the year/total comprehensive income – – 92,386 92,386 Ordinary shares repurchased and cancelled (180) (41,584) – (41,764) Dividends – – (8,680) (8,680) Total transactions with equity shareholders (180) (41,584) (8,680) (50,444) Balance at 31 December 2020 1,806 188,144 538,000 727,950 Profit for the year/total comprehensive income – – 248,734 248,734 Ordinary shares repurchased and cancelled 20 (20) (7,131) – (7,151) Dividends 21 – – (8,082) (8,082) Total transactions with equity shareholders (20) (7,131) (8,082) (15,233) Balance at 31 December 2021 1,786 181,013 778,652 961,451 The Notes on pages 126 to 143 are an integral part of these Consolidated Financial Statements. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Consolidated Financial Statements ## Consolidated statement of cash flows For the year ended 31 December 2021 **Cash flows from operating activities** Purchases of investments Sales of investments Accrued interest repayments and other income Expenses paid Bank and other interest received **Net cash from (used in) operating activities** **Cash flows from financing activities** Purchase of ordinary shares Dividends paid **Net cash from (used in) financing activities** **Net increase (decrease) in cash and cash equivalents** **Cash and cash equivalents at the beginning of the year** Net increase/(decrease) in cash and cash equivalents Effect of foreign exchange rate changes **Cash and cash equivalents at the end of the year** The Notes on pages 126 to 143 are an integral part of these Consolidated Financial Statements. ### Oakley Capital Investments Annual Report 2021 126 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Notes to the Consolidated Financial Statements 1. Reporting entity Oakley Capital Investments Limited (the ‘Company’) is a closed-end investment company incorporated under the laws of Bermuda on 28 June 2007. The Company invests in the following private equity funds structures (the ‘Funds’): Fund group name Country of establishment Limited partnerships included 1 Fund I Bermuda Oakley Capital Private Equity L.P. Fund II Bermuda OCPE II Master L.P. 1 Oakley Capital Private Equity II-A L.P. Oakley Capital Private Equity II-B L.P. Oakley Capital Private Equity II-C L.P. Fund III Bermuda OCPE III Master L.P. 1 Oakley Capital Private Equity III-A L.P. Oakley Capital Private Equity III-B L.P. Oakley Capital Private Equity III-C L.P. Fund IV Luxembourg Oakley Capital IV Master SCSp 1 Oakley Capital Private Equity IV-A SCSp Oakley Capital Private Equity IV-B SCSp Oakley Capital Private Equity IV-C SCSp Origin Fund Luxembourg Oakley Capital Origin Master SCSp 1 Oakley Capital Private Equity Origin A SCSp Oakley Capital Private Equity Origin B SCSp Oakley Capital Private Equity Origin C SCSp 1 Denotes the limited partnership in which the Company has made a direct investment. The defined term ‘Company’ shall, where the context requires for the purposes of consolidation, include the Company’s sole and wholly owned subsidiary, OCI Financing (Bermuda) Limited (‘OCI Financing’). OCI Financing provides financing to NSG Apparel BV, an entity that forms part of the North Sails Group in which Fund II invests. The Company is listed on the Specialist Fund Segment (‘SFS’) of the London Stock Exchange (‘LSE’), with the ticker symbol ‘OCI’. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 2. Basis of preparation The Consolidated Financial Statements of the Company have been prepared on a going concern basis and under the historical cost convention, except for financial instruments at fair value through profit and loss, which are measured at fair value. COVID-19 continues to cause disruption to economies around the world, however the roll-out of the vaccination programme and adjustment to new ways of working has meant that uncertainty is gradually decreasing. As a result, private equity activity rebounded strongly during 2021 and consequently valuations have increased, particularly in the sectors that have remained resilient, such as technology and business software. The Board of Directors has assessed if it is appropriate to adopt the going concern basis of accounting in preparing these Consolidated Financial Statements. As part of this assessment, the Board of Directors has considered a wide range of information relating to the present and future conditions, including the continued impact of COVID-19 on some of the portfolio companies of the Funds, as well as the impact on investment and sale expectations for each of the Funds, cash flow projections and the longer-term strategy of the Company. As part of the assessment, the Board of Directors: - assessed liquidity, solvency and capital management. The Company considered liquidity risk as the risk that the Company may encounter difficulty in meeting obligations arising from its financial liabilities that are settled by delivering cash or another financial asset, or that such obligations would have to be settled in a manner disadvantageous to the Company. Unfunded commitments to the Funds are irrevocable and can exceed cash and cash equivalents available to the Company. Based on current cash flow projections and barring unforeseen events, the Company expects to be able to meet its obligations as they fall due. As at 31 December 2021, cash and cash equivalents of the Company amount to £163,177,622. The Company has total unfunded capital and unquoted debt security commitments of £405,551,000 relating to the Funds, which are expected to be called over the next four to five years. Under the Company's bye-laws, the Company is permitted to borrow up to 25% of total shareholders' equity, which would amount to approximately £240,362,826 for the year ended 31 December 2021. As at 31 December 2021, the Company has had no debt facilities. The Directors consider the Company to have sufficient resources and liquidity and can continue to operate for a period of at least 12 months; - considered the estimates inherent to the valuations of the Funds and the unquoted debt securities. The Company's approach to valuations was consistent with the prior period's approach. In addition, key assumptions and estimates relating to the valuation of the unquoted debt instruments were considered. This included assessment of could flow projections; and - assessed the operational resilience includes monitoring the performance The Board of Directors considers Financial Statements of the Company considered the impact of COVID-19 companies of the Funds. The judgements, assumptions and policies that are considered by the Company to the Company's results and financial investments and the assessment of investment entity and are detailed ## 2.1 Basis for compliance The Consolidated Financial Statements of the Company's accordance with International Financial ## 2.2 Functional and presentation The Consolidated Financial Statements which is the Company's functional ## 3. Significant accounting policies The principal accounting policies of the Consolidated Financial Statements are set out in the following table. The Company is applied to all periods presented, under ## 3.1 Changes in accounting policies ### (a) New and amended standards Several amendments and interpretations of the Consolidated Financial Statements of the Company's 2021 but do not have a material effect on the Financial Statements and did not require re- ### (b) New standards, amendments and interpretations of the Consolidated Financial Statements of the Company's 2021 and 2022 A number of new amendments and amendments are beginning after 1 January 2021 and the Consolidated Financial Statements of the Company has not early adopted the Consolidated Financial Statements of the Company expected to have a material impact. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 3. Significant accounting policies continued ### 3.2 Basis for consolidation The Consolidated Financial Statements have been prepared using uniform accounting policies for like transactions and other events in similar circumstances. The Consolidated Financial Statements include the financial statements of the Company and its wholly owned subsidiary, after the elimination of all significant intercompany balances and transactions. IFRS 10 exempts investment entities from consolidating controlled investees. The Company meets the definition of an investment entity, as the following conditions are met: - The Company obtains funds from investors and provides investment management services. - The business purpose of the Company is to invest into private equity funds and to purchase, hold and dispose of investments directly in portfolio companies with the goal of achieving returns from capital appreciation and investment income. The Company also has further typical characteristics of an investment entity as defined by IFRS: - The performance of these investments is measured and evaluated on a fair value basis. - The Company holds multiple investments and has multiple investors. - It has investors that are not related parties of the Company. - It has ownership interests in the form of equity or similar interests. An investment entity is still required to consolidate a subsidiary where that subsidiary provides services that relate to the investment entity's investment activities. The Funds do not provide services that relate to the Company's investment activities. The Company therefore measures its investments at fair value through profit and loss in accordance with the investment entity exemption. The Company does not consolidate any of its investments in the Funds. As at 31 December 2021, the Company's Limited Partner ownership in the Funds was: - Fund I ownership of 70.4% (2020: 70.4%) - Fund II ownership of 36.2% (2020: 36.2%) - Fund III ownership of 40.7% (2020: 40.7%) - Fund IV ownership of 27.4% (2020: 27.4%) - Origin Fund ownership of 28.2% (2020: 27.0%) ### 3.3 Investments #### (a) Classification The Company classifies its investment model for managing those financial characteristics, if any, of the financial management and performance is evaluated primarily focused on fair value information, the assets' performance and to make a position to irrevocably designate an comprehensive income. The contractual cash flows of the Company and interest, however these securities are contractual cash flows nor held by the Company. The collection of contractual cash flows from the Company's business model's objectives and investments in private equity funds and assets held at fair value through profit and loss. #### (b) Recognition and measurement Financial assets held at fair value through profit and loss on the trade date which is the date of the contractual provisions of the Company through profit and loss are recognized and recognised in profit or loss. Net gains and losses from financial assets held at fair value through loss include all realised and unrealized differences and are included in the fair value of the income in the period in which the Company is held. Quoted investments are subsequently acquired using the last reported sales price and within the bid-ask spread. In circulation, it is not within the bid-ask spread, the Investment Advisor, will determine the representative of fair value. Unquoted investments, including capital capital, are carried in the consolidated balance sheet in accordance with the Company's instructions with the fair value guidelines under the Financial and Venture Capital (IPEV) Valuation. ### Oakley Capital Investments Annual Report 2021 129 GOVERNANCE FINANCIALS GLOSSARY STRATEGIC REPORT ## Notes to the Consolidated Financial Statements 3. Significant accounting policies continued 3.8 Expenses 3.9 Foreign currency translation 3.4 Cash and cash equivalents 3.5 Trade receivables 3.6 Trade payables 3.10 Share capital 3.7 Interest income 3.11 Earnings per share (c) Derecognition The Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred or in which the Company neither transfers nor retains substantially all the risks and rewards of ownership and does not retain control of the financial asset. Any interest on such transferred financial assets that is created or retained by the Company is recognised as a separate asset or liability. On derecognition of a financial asset, the difference between the carrying amount of the asset (or the carrying amount allocated to the portion of the asset derecognised) and consideration received (including any new asset obtained less any new liability assumed) is recognised in profit or loss. Cash and cash equivalents include deposits held on call with banks and other short-term deposits. The Company considers all short-term deposits with an original maturity of 90 days or less as equivalent to cash. Trade receivables are recognised initially at fair value and subsequently measured at amortised cost, less any allowance for impairment, using the effective interestmetht method. Trade payables are obligations to pay for goods or services that have been acquired or received in the ordinary course of business from suppliers. Accounts payable are classified as current liabilities if payment is due within one year or less (or in the normal operating cycle of the business if longer). If not, they are presented as non-current liabilities. Trade payables are recognised initially at fairfair value and subsequently measured at amortised cost using the effective interestmetht method. Interest on unquoted debt securities held at fair value through profit and loss is accrued on a time-proportionate basis, by reference to the principal outstanding and the effective interest rate applicable, which is the rate that discounts estimated future cash receipts over the expected life of the debt security to its net carrying amount on initial recognition. Interest income is recognised gross of withholding tax, if any. Interest income on unquoted debt securities is recognised as a separate line item in the consolidated statement of comprehensive income and classified within operating activities in the consolidated statement of cash flows. Expenses are recognised on the accruals basis. Negative interest income is included in expenses in the consolidated statement of comprehensive income and classified within operating activities in the consolidated statement of cash flows. The functional currency of the Company is Pounds. Transactions in currencies other than Pounds are recorded at the rates of exchange prevailing on the dates ofof the transactions. At each reporting date, investments and other monetary assets and liabilities that are denominated in foreign currencies are translated at the rates prevailing on the reporting date. Capital drawdowns and proceeds of distributions from the Funds and foreign currencies and income and expense items denominated in foreign currencies are translated into Pounds at the exchange rate on the respective dates of such transactions. Foreign exchange gains and losses on other monetary assets and liabilities are recognised in net foreign currency gains and losses in the consolidated statement of comprehensive income. The Company does not isolate unrealised or realised foreign exchange gains and losses arising from changes in the fair value of investments. All such foreign exchange gains and losses are included with the net realised and unrealised gains or losses on investments in the consolidated statement of comprehensive income. Ordinary shares issued by the Company are recognised based on the proceeds or fair value received or receivable, with the excess of the amount received over their nominal value being credited to the share premium account. Direct issue costs are deducted from equity. The Company presents basic and diluted earnings per share data for its ordinary shares. Basic earnings per share are calculated by dividing the profit or loss attributable to ordinary shareholders of the Company by the weighted average number of ordinary shares outstanding during the period. Diluted earnings per ### Oakley Capital Investments Annual Report 2021 130 STRATEGIC REPORT GOVERNANCE GLOSSARYFINANCIALS ## Notes to the Consolidated Financial Statements 3. Significant accounting policies continued 4. Critical accounting estimates, assumptions and judgement 5. Financial risk management 5.1 Introduction and overview share are determined by adjusting the profit or loss attributable to ordinary shareholders and the weighted average number of ordinary shares outstanding forfor the effects of all potentially dilutive ordinary shares. The reported results of the Company are sensitive to the accounting policies, assumptions and estimates that underly the preparation of its Consolidated Financial Statements. IFRS require the Board of Directors, in preparing the Company’s Consolidated Financial Statements, to select suitable accounting policies, apply them consistently and make judgements and estimates that are reasonable and prudent. The Company’s estimates and assumptions are based on historical experience and the Board of Directors’ expectation of future events and are reviewed periodically. The actual outcome may be materially different from that anticipated. Revisions to accounting estimates are recognised in the period in which the estimates are revised and in any future periods affected. The judgements, assumptions and estimates involved in the Company’s accounting policies that are considered by the Board of Directors to be the most important to Company’s results and financial condition are the fair valuation of the investments and the assessment that the Company meets the definition of an investment entity. (a) Fair valuation of investments The fair values assigned to investments held at fair value through profit and loss are based upon available information at the time and do not necessarily represent amounts which might ultimately be realised. Because of the inherent uncertainty of valuation, these estimated fair values may differ significantly from the values that would have been used had a ready market for the investments existed, and those differences could be material. Investments held at fair value through profit and loss are valued by the Company in accordance with relevant IFRS requirements. Judgement is required in order to determine the appropriate valuation methodology under these standards. Subsequently, judgement is required in assessing the Net Asset Value of the Funds and determining the inputs into the valuation models used for the unquoted debt securities. Inputs include making assessments of the estimated future cash flows and determining appropriate discount rates. There remain many unknown factors over the short, medium and long term. TheThe impact of COVID-19 on economic uncertainty has lessened in 2021 due in part to effective vaccination programmes, however a degree of additional uncertainty remains, particularly in relation to potential new variants such as the impact associated with Omicron. There is also added uncertainty over recent increases in inflation within economies the Funds invest in that have led to a higher likelihoodelihood ofof increases in interest rates which may in turn impact Fund valuations. The Investment Adviser has considered the impact of COVID-19 in determining inputs in the valuation models used for the valuations of each of the Funds. Additionally the impact of COVID-19 has been considered in the valuation of the unquoted debt securities. (b) Assessment as an investment entity Entities that meet the definition of an investment entity within IFRS 10 are required to account for investments in controlled entities, as well as investments inin associates and joint ventures, at fair value through profit and loss. The Board of Directors has concluded that the Company meets the definition of an investment entity as its strategic objective is to invest in the Funds on behalf of its investors for the purpose of generating returns in the form of investment income and capital appreciation. This conclusion is further detailed in Note 3.2. The Board of Directors, the Company’s Risk Committee and the Investment Adviser attribute great importance to professional risk management, proper understanding and negotiation of appropriate terms and conditions and active monitoring, including a thorough analysis of reports and financial statements and ongoing review of investments made. The Company has investment guidelines that set out its overall business strategies, its tolerance for risk and its general risk management philosophy and has established processes to monitor and control the economic impact of these risks. The Investment Adviser provides the Board of Directors with recommendations as to the Company’s asset allocation and annual investment levels that are consistent with the Company’s objectives. The Risk Committee reviews and agrees policies for managing the risks. The Company has exposures to the following risks from financial instruments: credit risk, liquidity risk and market risk (including interest rate risk, currency risk and price risk). The Company’s overall risk management process focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Company’s financial performance. During the period under review, the Risk Committee has continued to identify, assess, monitor and manage risks within the Company, including those that would impact its future performance, solvency, liquidity or reputation. Thision. This revieww includes the monitoring of risk exposure compared with the risk appetite established by the Board. ![Oakley Capital Investments logo]() Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 5. Financial risk management continued Key risks and uncertainties of the Company are assessed on a scale, considering their impact and likelihood. The Committee monitors detailed and, wherever possible, quantifiable indicators of the Company's exposure to risk, segmented into five core categories, summarised on pages 71-75. During 2021, regular consideration was given to the impact COVID-19 had in each of the five categories of risk. ### 5.2 Credit risk The Company is subject to credit risk on its unquoted investments and cash. The majority of the Company's cash balances were held with Barclays and Butterfield Bank, with a minority also held with HSBC. Barclays and HSBC are rated A1 and Butterfield Bank is rated at A3 by Moody's (2020: Barclays and HSBC A1 and Butterfield A3). In accordance with the Company's policy, the Investment Adviser monitors the Company's exposure to credit risk on cash on a quarterly basis and the Risk Committee regularly reviews the Company's exposure to credit risk. The credit quality of the investments in the Funds and debt securities, which are held at fair value and include debt and equity elements, are not rated. As at 31 December 2021, no debt securities held were overdue or impaired. ### 5.3 Liquidity risk Liquidity risk is the risk that the Company will encounter difficulty in meeting obligations arising from its financial liabilities that are settled by delivering cash or another financial asset, or that such obligations will have to be settled in a manner disadvantageous to the Company. The Company, with advice from the Investment Adviser, manages liquidity through reviews of detailed cash flow projections which estimate the timing and quantities of outflows, including capital calls, and inflows from disposals of portfolio companies held within the Funds which aim to avoid undue risk of illiquidity. The unfunded commitments to the Funds are irrevocable and can exceed cash and cash equivalents available to the Company. Based on current cash flow projections and barring unforeseen events, the Company expects to be able to honour all capital calls by the Funds. The Board of Directors' assessment of liquidity risk is further detailed in Note 2. The majority of the investments held by the Company are in Funds which are unquoted and subject to specific restrictions on transferability and disposal. Consequently, the risk exists that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's risk is the risk that the Company's The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. ### 5.4 Market risk Market risk is the risk that changes in the financial statements of the Company's exchange rates and interest rates. The Company's financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's consolidated financial statements are based on the Company's consolidated financial statements. The Company's financial assets that are not included in the financial statements are analysed below (presented in the financial statements) and the Company's financial assets are excluded below (presented in the financial statements) and the Company's financial assets are excluded below (presented in the financial statements) and the Company's financial assets are excluded below (presented in the financial statements) and the Company's financial assets are excluded below (presented in the financial statements) and the Company's financial assets are excluded below (presented in the financial statements) and the Company's financial assets are excluded below (presented in the financial statements) and the Company's financial assets are excluded below (presented in the financial statements). | | Pound £'000 | Euro £'000 | | --- | --- | --- | | Fixed and floating rate debt and cash | 205,348 | 88,476 | | Non-interest-bearing Fund and equity investments | 39,450 | 628,541 | | Total | 244,798 | 717,017 | #### (a) Interest rate risk Interest rate risk arises principally from the Company's capital and the Company's capital. The Company's capital is the capital of the Company's capital. The Company's capital is the capital of the Company's capital. The Company's capital is the capital of the Company's capital. The Company's capital is the capital of the Company's capital. The Company's capital is the capital of the Company's capital. The Company's capital is the capital of the Company's capital. The Company's unquoted debt securities are held at fair value and include debt and equity securities. The Company's unquoted debt securities are held at fair value and include debt and equity securities. The Company's unquoted debt securities are held at fair value and include debt and equity securities. The Company's unquoted debt securities are held at fair value and include debt and equity securities. The Company's unquoted debt securities are held at fair value and include debt and equity securities. The Company's unquoted debt securities are held at fair value and include debt and equity securities. The Company's unquoted debt securities are held at fair value and include debt and equity securities. The Company's unquoted debt securities are held at fair value and include debt and equity securities. ![Oakley Capital Investments logo]() Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 5. Financial risk management continued The impact of an increase in interest rates of 100 basis points on cash and deposits, based on the closing consolidated balance sheet position over a 12-month period, would have been £1,757,137 on the profit and loss in the consolidated statement of comprehensive income (2020: £2,053,734). A decrease in interest rates of 100 basis points on cash and deposits would have an equal and opposite effect. In addition, the Company has indirect exposure to interest rate fluctuations through changes to the financial performance and valuation in equity investments in the Funds as certain portfolio companies have issued debt. Short-term receivables and payables are excluded as, due to their short-term nature, the risks due to fluctuation in the prevailing levels of market interest rates associated with these instruments are not significant. ### (b) Currency risk The Company holds significant assets and liabilities denominated in currencies other than its functional currency, which expose the Company to the risk that the exchange rates of those currencies against the Pound will change in a manner which adversely impacts the Company's net profit and net assets attributable to shareholders. The following sensitivity analysis shows the sensitivity of the Company's net assets to movements in foreign currency exchange rates assuming a 10% increase in exchange rates against the Pound. A 10% decrease in exchange rates against the Pound would have an equal and opposite effect. This sensitivity analysis below is representative of the year as a whole, since the level of exposure changes as the Company's holdings change through the purchase and realisation of investments. | | 2021 Euro £'000 | 2020 Euro £'000 | | --- | --- | --- | | Assets: | | | | Financial assets at fair value through profit and loss | 62,854 | 35,472 | | Cash and cash equivalents | 7,436 | 14,799 | | Total assets | 70,290 | 50,271 | | **Impact on profit (loss)** | **70,290** | **50,271** | The Investment Adviser monitors the Company's currency position on a regular basis and reports the impact of currency movements on the performance of the investment portfolio to the Risk Committee quarterly. In accordance with the Company's investment policy, all direct investments in quoted equity securities and debt securities are denominated in Pounds, placing currency risk on the counterparty. The investments in the Funds are denominated in euros. ### (c) Price risk – market fluctuations For quoted equity securities, the market price itself. A 15% change in a £5,917,543 (2020: £3,590,988) consolidated statement of comprehensive income to shareholders in the consolidated ordinary share is £0.03 (2020: £0.03) For the investment in the Funds, the risk in fair value. A 15% change in the a £94,281,218 (2020: £53,207,700) consolidated statement of comprehensive income to shareholders in the consolidated ordinary share is £0.53 (2020: £0.53) The Company is exposed to a variable significantly over time. As a result, the point in time may be difficult given to hold by the Funds. ### Limitations of sensitivity analysis The sensitivity information includes impact of a change in a major impact unchanged. In reality, there are no the assumptions and other factors. It should also be noted that these smaller impacts should not be in furthermore, estimates of sensitivity conditions, such as instances where ## 5.5 Capital management The Company's capital comprises one vote each. The holders of the Company has no additional risk of issuance and re-purchase of ordinary in the consolidated statement of The Company's objectives when assets to achieve positive returns structure, the Company may issue through the repurchase of shares the repurchase and resale of share OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 6. Investments Investments as at 31 December 2021: | | 2020 Fair value £'000 | Purchases/ capital calls £'000 | Total sales/ distributions* £'000 | Realised gains (losses)** £'000 | | --- | --- | --- | --- | --- | | **Oakley Funds** | | | | | | Fund I | 16,149 | - | - | (784) | | Fund II | 53,210 | - | - | (76) | | Fund III | 217,866 | 15,948 | (56,295) | 65,851 | | Fund IV | 66,360 | 76,076 | (3,845) | (5,306) | | Origin Fund | 1,133 | 9,521 | - | (3,092) | | **Total Oakley Funds** | **354,718** | **101,545** | **(60,140)** | **56,593** | | **Quoted equity securities** | | | | | | Time Out Group plc | 23,940 | - | - | - | | **Total quoted equity securities** | **23,940** | **-** | **-** | **-** | | **Unquoted debt securities** | | | | | | Ellisfield (Bermuda) Limited | 17,264 | - | (17,545) | - | | Fund I | 6,645 | 6,862 | (6,891) | - | | NSG Apparel BV | 38,709 | 11,820 | - | - | | Oakley NS (Bermuda) LP | 63,848 | - | - | - | | **Total unquoted debt securities** | **126,466** | **18,682** | **(24,436)** | **-** | | **Total investments** | **505,124** | **120,227** | **(84,576)** | **56,593** | * Total sales include redemptions, loan repayments (including accrued interest and arrangement fees) and transfers. ** Realised gains/(losses) include realised gains/(losses) on underlying fund portfolio investments sold in the period, and income and expenses of the underlying fund. *** Unrealised gains/(losses) include FX on the conversion of period end fund holdings from the Fund's reporting currency (euros) to Pounds, plus inception to date of change in OCI's share of fund holdings. Changes in Provisional Profit Allocation ('carry') are apportioned across the realised and unrealised gains. CC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 6. Investments continued Investments as at 31 December 2020: | | 2019 Fair value £'000 | Purchases/ capital calls £'000 | Total sales/ distributions* £'000 | Realised gains/(losses)** £'000 | | --- | --- | --- | --- | --- | | **Oakley Funds** | | | | | | Fund I | 33,358 | 10,906 | - | - | | Fund II | 57,182 | 8,689 | (16,993) | 10,455 | | Fund III | 310,068 | - | (186,493) | 123,345 | | Fund IV | 19,708 | 32,018 | - | - | | Origin Fund | - | 2,856 | - | - | | **Total Oakley Funds** | **420,316** | **54,469** | **(203,486)** | **133,800** | | **Direct investment funds** | | | | | | OCPE Education (Feeder) LP | 74,984 | - | (94,210) | 74,736 | | **Total direct investment funds** | **74,984** | **-** | **(94,210)** | **74,736** | | **Total funds** | **495,300** | **54,469** | **(297,696)** | **208,536** | | **Quoted equity securities** | | | | | | Time Out Group plc | 38,510 | 12,625 | - | - | | **Total quoted equity securities** | **38,510** | **12,625** | **-** | **-** | | **Unquoted debt securities** | | | | | | Ellisfield (Bermuda) Limited | 15,796 | - | - | - | | Fund I | 9,435 | 1,000 | (4,432) | - | | Fund II | 4,398 | 3,333 | (7,985) | - | | NSG Apparel BV | 29,992 | 6,990 | - | - | | Oakley Capital III Limited | 731 | - | (732) | - | | Oakley NS (Bermuda) LP | 43,490 | 15,066 | - | - | | Time Out Group Plc | 23,314 | 2,500 | (27,071) | - | | **Total unquoted debt securities** | **127,156** | **28,889** | **(40,220)** | **-** | | **Total investments** | **660,966** | **95,983** | **(337,916)** | **208,536** | * Total sales include redemptions, loan repayments (including accrued interest and arrangement fees) and transfers ** Realised gains/(losses) include realised gains/(losses) on underlying fund portfolio investments sold in the period, and income and expenses of the underlying fund *** Unrealised gains/(losses) include FX on the conversion of period end fund holdings from the Fund's reporting currency (euros) to Pounds, plus inception to date of change in DCI's share of fund holdings. Changes in Provisional Profit Allocation ('carry') are apportioned across the realised and unrealised gains. The Fund I unquoted debt security is a direct investment into Fund I and the Time Out Group Plc quoted equity security of Fund I. The NSG Apparel BV and Oakley NS (Bermuda) LP unquoted debt securities are investments into or related to. Distributions on unquoted debt securities include accrued interest repayments of £3,627,000 (2020: £5,321,000). OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 7. Net gains/(losses) from investments at fair value through profit and loss | | 2021 £'000 | 2020 £'000 | | --- | --- | --- | | Net change in unrealised gains (losses) on investments at fair value through profit and loss: | | | | Funds | 175,825 | (105,891) | | Quoted equity securities | 15,510 | (27,195) | | Total net change in unrealised gains (losses) on investments at fair value through profit and loss | 191,335 | (133,086) | | Net realised gains (losses) on investments at fair value through profit and loss: | | | | Funds | 56,593 | 208,536 | | Total net realised gains (losses) on investments at fair value through profit and loss | 56,593 | 208,536 | ## 8. Disclosure about fair value of financial instruments The Company has adopted IFRS 13 in respect of disclosures about the degree of reliability of fair value measurements. These fair value measurements are categorised into different levels in the fair value hierarchy based on the inputs to valuation techniques used. The Company classifies financial instruments measured at fair value in the investment portfolio according to the following hierarchy: - Level I: Quoted prices (unadjusted) in active markets for identical instruments that the Company can access at the measurement date. Level I investments include quoted equity instruments. - Level II: Inputs other than quoted prices included within Level I that are observable for the instrument, either directly (i.e. as prices) or indirectly (i.e. derived from prices). - Level III: Inputs that are not based on observable market data. Level III investments include private equity funds and unquoted debt securities. The level in the fair value hierarchy within which the fair value measurement is categorised is determined on the basis of the lowest level input that is significant to the fair value measurement in its entirety. Assessing the significance of a particular input to the fair value measurement in its entirety requires judgement, considering factors specific to the instrument. The determination of what constitutes 'observable' requires significant judgement by the Company. The Company considers observable results regularly distributed or updated, provided by independent sources. The following table analyses the 01 December 2021 by the level of measurement is categorised: | Funds | | --- | | Quoted equity securities | | Unquoted debt securities | | Total investments measured at fair value | | The following table analyses the 01 December 2020 by the level of measurement is categorised: | | Funds | | --- | | Quoted equity securities | | Unquoted debt securities | | Total investments measured at fair value | ### Level I Quoted equity investment values, markets, and are therefore classified not adjust the quoted price for the ### Level II The Company did not hold any Level II 31 December 2020. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 8. Disclosure about fair value of financial instruments continued ### Level III The Company has determined that Funds and unquoted debt securities fall into Level III. Funds and unquoted debt securities are measured in accordance with the IPEV Valuation Guidelines with reference to the most appropriate information available at the time of measurement. The Consolidated Financial Statements as of 31 December 2021 include Level III investments in the amount of £759,208,400, representing approximately 78.96% of shareholders' equity (2020: £481,183,852; 66.10%). ### Funds The Company primarily invests in portfolio companies via the Funds as a Limited Partner. The Funds are unquoted equity securities. The Company's investments in unquoted equity securities are recognised in the consolidated balance sheet at fair value, in accordance with IPEV Valuation Guidelines and IFRS 13 and are considered Level III investments. The valuation of unquoted fund investments is based on the latest available Net Asset Value ('NAV') of the Fund as reported by the corresponding general partner or administrator, provided that the NAV has been appropriately determined using fair value principles in accordance with IFRS 13. The NAV of a Fund is calculated after determining the fair value of that Fund's investment in any portfolio company. The fair value is determined by the Investment Adviser by calculating the Enterprise Value ('EV') of the portfolio company and then adding excess cash and deducting financial instruments, such as external debt, ranking ahead of the Fund's highest ranking instrument in the portfolio company. A common method of determining the EV is to apply a market-based multiple (e.g. an average multiple based on a selection of comparable quoted companies) to the 'maintainable' earnings or revenues of the portfolio company. This market-based approach presumes that the comparable companies are correctly valued by the market. A discount is sometimes applied to market-based multiples to adjust for points of difference between the comparables and the company being valued. As at 31 December 2021, the valuation of liabilities attributable to the Company in each Fund was as follows: | Investments | 2 | | --- | --- | | Loans | | | Estimated performance fee payable | | | Other net assets | ( | | Total value of the Fund attributable to the Company (€'000) | | | Total value of the Fund attributable to the Company (€'000) at year-end exchange rate | 2 | | As at 31 December 2020, the valuation of liabilities attributable to the Company in each Fund was as follows: | | | Investments | | | Loans | | | Estimated performance fee payable | | | Other net assets | | | Total value of the Fund attributable to the Company (€'000) | | | Total value of the Fund attributable to the Company (€'000) at year-end exchange rate | | OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 8. Disclosure about fair value of financial instruments continued The Company records its investments in the Funds at the NAV reported by the Funds which it considers to be fair value. The NAV as reported by the Funds' general partner or administrator is considered to be the key unobservable input. The Company has the following control procedures in place to evaluate whether the NAV of the underlying Fund investments represents a reliable estimate of fair value and calculated in a manner consistent with IFRS 13: - Thorough initial due diligence processes and the Board of Directors performing ongoing monitoring procedures, primarily discussions with the Investment Adviser. - Comparison of historical realisations to last reported fair values. - Review of the quarterly financial statements and the annual audited NAV of the respective Fund. ### Unquoted debt securities The fair values of the Company's investments in unquoted debt securities are derived from a discounted cash flow calculation based on expected future cash flows to be received, discounted at an appropriate rate. Expected future cash flows include interest received and principal repayment at maturity. ### Unobservable inputs for Level III investments #### Funds In arriving at the fair value of the unquoted Fund investments, the key input used by the Company is the NAV as provided by the general partner or administrator of the relevant Fund. The Company recognises that the NAVs of the Funds are highly sensitive to movements in the fair values of the underlying portfolio companies. The underlying portfolio companies owned by the Funds may include both quoted and unquoted companies. Quoted portfolio companies are valued based on market prices and no unobservable inputs are used. Unquoted portfolio companies are valued by the Investment Adviser based on a market approach for which significant judgement is applied. Consideration has also been given by the Investment Adviser to the impact of COVID-19 for the valuation at 31 December 2021. For the purposes of sensitivity and the fair value of the unquoted funds, the Company's investments in unquoted portfolio companies have been used to determine if it is not assets attributable to shares of the unquoted portfolio companies and opposite effect. ### Unquoted debt securities In arriving at the fair value of the unquoted funds, the Company's investments in unquoted portfolio companies are valued based on market prices and no unobservable inputs are used. Unquoted portfolio companies are valued by the Investment Adviser based on a market approach for which significant judgement is applied. Consideration has also been given by the Investment Adviser to the impact of COVID-19 for the valuation at 31 December 2021. For the purposes of sensitivity and the fair value of the unquoted funds, the Company's investments in unquoted portfolio companies are valued based on market prices and no unobservable inputs are used. Unquoted portfolio companies are valued by the Investment Adviser based on a market approach for which significant judgement is applied. Consideration has also been given by the Investment Adviser to the impact of COVID-19 for the valuation at 31 December 2021. ### Transfers between levels There were no transfers between levels 2021 (2020: none). ### Level I and Level III reconciliation The changes in investments measured by the Company's investments in unquoted funds are based on level I and Level III inputs to the Company's investments in unquoted funds, and are as follows: #### Level I Investments: Quoted equity securities Fair value at beginning of year Purchases Net change in unrealised gains (loss) Fair value of Level I investments at end of year ![Oakley Capital Investments logo]() Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 8. Disclosure about fair value of financial instruments continued | Level III investments: | Funds £'000 | Unquoted debt securities £'000 | Total £'000 | | --- | --- | --- | --- | | **2021** | | | | | Fair value at beginning of year | 354,718 | 126,466 | 481,184 | | Purchases | 101,545 | 18,682 | 120,227 | | Proceeds on disposals (including interest) | (60,140) | (24,436) | (84,576) | | Realised gain on sale | 56,593 | - | 56,593 | | Interest income and other fee income | - | 9,955 | 9,955 | | Net change in unrealised gains (losses) on investments | 175,825 | - | 175,825 | | Fair value at end of year | 628,541 | 130,667 | 759,208 | | Level III investments: | Funds £'000 | Unquoted debt securities £'000 | Total £'000 | | --- | --- | --- | --- | | **2020** | | | | | Fair value at beginning of year | 495,300 | 127,156 | 622,456 | | Purchases | 54,469 | 28,889 | 83,358 | | Proceeds on disposals (including interest) | (297,696) | (40,220) | (337,916) | | Realised gain on sale | 208,536 | - | 208,536 | | Interest income and other fee income | - | 10,641 | 10,641 | | Net change in unrealised gains (losses) on investments | (105,891) | - | (105,891) | | Fair value at end of year | 354,718 | 126,466 | 481,184 | ## Other financial instruments Financial instruments, other than and loss, where carrying values re Cash and cash equivalents Trade and other receivables Trade and other payables ## 9. Segment information The Company has two reportable and the Board of Directors receives d following summary describes the segments: - Direct investments Balance sheet and income and ex one of the segments are shown in The reportable operating segment investments to achieve an attract The return consists of interest, div capital gains. The financial information provide assets and liabilities is presented Financial Statements. The assess segments is based on measure of capital calls payable, liabilities a but rather managed at the corpo There have been no transactions financial year 2021 (2020: none). CC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 9. Segment information continued The segment information for the year ended 31 December 2021 is as follows: | | Funds investments £'000 | Direct investments and loans £'000 | Total operating segments £'000 | Corporate £'000 | Total £'000 | | --- | --- | --- | --- | --- | --- | | Net realised gains on financial assets at fair value through profit and loss | 56,593 | - | 56,593 | - | 56,593 | | Net change in unrealised gains (losses) on financial assets at fair value through profit and loss | 175,825 | 15,510 | 191,335 | - | 191,335 | | Interest income | - | 9,684 | 9,684 | 389 | 10,073 | | Net foreign currency gains (losses) | - | - | - | (5,787) | (5,787) | | Other income | - | 271 | 271 | - | 271 | | Expenses | - | - | - | (3,751) | (3,751) | | Profit (loss) for the year | 232,418 | 25,465 | 257,883 | (9,149) | 248,734 | | **Total assets** | **628,541** | **170,117** | **798,658** | **163,301** | **961,959** | | **Total liabilities** | **-** | **-** | **-** | **(508)** | **(508)** | | **Net assets** | **628,541** | **170,117** | **798,658** | **162,793** | **961,451** | | Total assets include: | | | | | | | Financial assets at fair value through profit and loss | 628,541 | 170,117 | 798,658 | - | 798,658 | | Cash and others | - | - | - | 163,301 | 163,301 | The segment information for the year ended 31 December 2021 is as follows: | | Funds investments £'000 | Direct investments and loans £'000 | Total operating segments £'000 | Corporate £'000 | Total £'000 | | --- | --- | --- | --- | --- | --- | | Net realised gains on financial assets at fair value through profit and loss | 56,593 | - | 56,593 | - | 56,593 | | Net change in unrealised gains (losses) on financial assets at fair value through profit and loss | 175,825 | 15,510 | 191,335 | - | 191,335 | | Interest income | - | 9,684 | 9,684 | 389 | 10,073 | | Net foreign currency gains (losses) | - | - | - | (5,787) | (5,787) | | Other income | - | 271 | 271 | - | 271 | | Expenses | - | - | - | (3,751) | (3,751) | | Profit (loss) for the year | 232,418 | 25,465 | 257,883 | (9,149) | 248,734 | | **Total assets** | **628,541** | **170,117** | **798,658** | **163,301** | **961,959** | | **Total liabilities** | **-** | **-** | **-** | **(508)** | **(508)** | | **Net assets** | **628,541** | **170,117** | **798,658** | **162,793** | **961,451** | | Total assets include: | | | | | | | Financial assets at fair value through profit and loss | 628,541 | 170,117 | 798,658 | - | 798,658 | | Cash and others | - | - | - | 163,301 | 163,301 | ## 10. Cash and cash equivalents Cash and demand balances at balance sheet ![Oakley Capital Investments logo]() Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 11. Trade and other receivables | | 2021 £'000 | 2020 £'000 | | --- | --- | --- | | Prepayments | 123 | 33 | | | 123 | 33 | ## 12. Trade and other payables | | 2021 £'000 | 2020 £'000 | | --- | --- | --- | | Trade payables | 165 | 87 | | Amounts due to related parties | 240 | 150 | | Other payables | 103 | 60 | | | 508 | 297 | ## 13. Interest income | | 2021 £'000 | 2020 £'000 | | --- | --- | --- | | Interest income on investments carried at amortised cost: | | | | Cash and cash equivalents | 389 | 215 | | Interest income on investments designated as at fair value through profit and loss: | | | | Debt securities | 9,684 | 10,251 | | | 10,073 | 10,466 | ## 14. Expenses | | Notes | 2021 £'000 | 2020 £'000 | | --- | --- | --- | --- | | Investment related fees | 15 | - | 4,266 | | Operating expenses | 16 | 3,751 | 3,354 | | | | 3,751 | 7,620 | ## 15. Investment related fees Included in Investment related fees, Oakley Capital Manager Limited (OALM), Agent provides operational assistance to the Company's direct investment. Operational Services Agreement was appointed as the Administrator. ### (a) Operational fees For the period of 1 January 2020, the Company received an operational service fee for the direct equity investments. Effective in 2020, the Company payable. No operational services fees were paid for the period of 1 January 2020 (2020: £620,874). There are no other fees (2020: none). ### (b) Performance fees For the period of 1 January 2020, the Company received a performance fee of 20% for the partial realisation on disposal of all the preferred return. With effect from 1 January 2020. There were no performance fees (2020: £3,644,444). There are no other fees (2020: none). ### (c) Advisory fees No investment advisory fees were paid for the Agent may receive an advisory fee. The Agency placed on behalf of the Company's direct investment fee would be negotiated on a cash basis. Administrative Agent and no such OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 16. Operating expenses The following expenses are included in operating expenses: ### (a) Administration Fees Mayflower Management Services (Bermuda) Limited ('Mayflower') provided administration services until 30 June 2021. Oakley Capital Limited ('the Administrator') was appointed by the Company to provide administration services at prevailing commercial rates from 1 July 2021. Administration fees for the year ended 31 December 2021 totalled £306,000 (2020: £344,584). There were no administration fees payable to the Administrator as at 31 December 2021 (2020: £nil). ### (b) Directors' fees For the year ended 31 December 2021, the Company paid Directors' fees of £100,000 (2020: £100,000) to the Chair of the Board and £270,000 (2020: £275,000) to other Board members. No fees were payable as at 31 December 2021 (2020: none). The members of the Board of Directors are considered to be Key Management Personnel. No pension contributions were made in respect of any of the Directors and none of the Directors receive any pension from any portfolio company held by the Funds. During the year, one of the Directors waived remuneration (2020: one). No other fees were paid to the Directors (2020: £nil). For the years ended 31 December 2021 and 2020, members of the Board of Directors held shares in the Company and were entitled to dividends as detailed below: | | 2021 | 2020 | | --- | --- | --- | | Shares at the beginning of the year | 18,363 | 18,018 | | Shares acquired during the year | 48 | 745 | | Shares held by a Director who resigned during the year | - | (400) | | Shares at the end of the year | 18,411 | 18,363 | | Dividends paid to Directors (£'000) | 827 | 818 | ### (c) Auditor's remuneration The Company's auditor is KPMG and other advisory services fees ### (d) Other expenses The Company is recharged by the (December 2021 to 30 June 2021) and by the (December 2021) for certain services relations. These services are provided by advisers (which include the Invest For the year ended 31 December 2021, the Administrator recharged £1,556,000 as at 31 December 2021 was £213,000 and other payables' in the consol ## 17. Withholding tax Under current Bermuda law, the tax in Bermuda on either income has received an undertaking from event of such taxes being imposed such taxation at least until 31 March The Company may, however, be income derived from its investment December 2021, the Company wa ## 18. Earnings per share The earnings per share calculation issue during the year. Basic and diluted earnings per share Profit for the year ('000) Weighted average number of shares The Company's diluted earnings per share CC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 19. Net asset value per share The NAV per share calculation uses the number of shares in issue at the end of the year. | | 2021 | 2020 | | --- | --- | --- | | Basic and diluted net asset value per share | £5.38 | £4.03 | | Net assets attributable to shareholders ('000) | £961,451 | £727,950 | | Number of shares in issue at year end ('000) | 178,600 | 180,600 | ## 20. Share capital ### (a) Authorised and issued capital The authorised share capital of the Company is 280,000,000 ordinary shares at a par value of £0.01 each. Ordinary shares are listed and traded on the SFS of the LSE Main Market. Each share confers the right to one vote and shareholders have the right to receive dividends. During the year ended 31 December 2021, the Company purchased the following ordinary shares: | | Number of ordinary shares | Purchase price (£'000) | | --- | --- | --- | | 29 July 2021 | 2,000,000 | 7,151 | During the year ended 31 December 2021, the Company purchased the following ordinary shares: | 3 December 2020 | | --- | | 2 October 2020 | | 29 July 2020 | | 18 June 2020 | | 18 March 2020 | The ordinary shares purchased by the Company are listed for re-issue. As at 31 December 2021, the Company purchased the following ordinary shares (2021-2022): | Ordinary shares outstanding at the end of the year | | --- | | Ordinary shares purchased | | Ordinary shares outstanding at the end of the year | ### (b) Share premium Share premium represents the amount of the share of ordinary shares. OC Oakley Capital Investments Annual Report 2021 STRATEGIC REPORT GOVERNANCE FINANCIALS # Notes to the Consolidated Financial Statements ## 21. Dividends On 11 March 2021, the Board of Directors declared a final dividend for 2020 of 2.25 pence per ordinary share resulting in a dividend of £4,063,499 paid on 15 April 2021 (2020: On 11 March 2020, the Board of Directors declared a final dividend for 2019 of 2.25 pence per ordinary share resulting in a dividend of £4,391,999 paid on 23 April 2020). On 9 September 2021, the Board of Directors declared an interim dividend of 2.25 pence per ordinary share resulting in a dividend of £4,018,499 paid on 14 October 2021 (2020: On 10 September 2020, the Board of Directors declared an interim dividend of 2.25 pence per ordinary share resulting in a dividend of £4,288,499 paid on 22 October 2020). ## 22. Commitments The Company had the following outstanding capital commitments in euros as at period end: | | Original commitment €'000 | 2021 €'000 | 2020 €'000 | | --- | --- | --- | --- | | Fund I | 202,398 | 2,834 | 2,834 | | Fund II | 190,000 | 13,300 | 13,300 | | Fund III | 325,780 | 101,806 | 120,539 | | Fund IV | 400,000 | 248,000 | 334,000 | | Origin Fund | 129,300 | 115,077 | 101,850 | | Total outstanding commitments (€'000) | 1,247,478 | 481,017 | 572,523 | | Total outstanding commitments (£'000) | 1,048,505 | 404,295 | 512,351 | The Company had the following outstanding unquoted debt security commitments at period end: | | Original commitment £'000 | 2021 £'000 | 2020 £'000 | | --- | --- | --- | --- | | Fund I | 8,000 | 1,138 | 5,000 | | Oakley NS (Bermuda) LP* | 54,700 | 118 | 128 | | Total outstanding commitments (£'000) | 62,700 | 1,256 | 5,128 | * As at 31 December 2020, the original commitment to Oakley NS (Bermuda) LP was £54,710,000. ## 23. Related parties Related parties transactions not of Statement are as follows: One Director of the Company, Peirce Adviser and Administrator, an entity of compensation from, the Company Administrative Agent, which is co the direct control this Director ha Company and these service prov are disclosed in Note 15. ## 24. Events after balance sheet At the time of writing, the conflict supply chains and short-term gro concerns have had minimal effect volatility to markets in the current of disruption to the global econo not practicable to determine at th The Board of Directors has evalu through 9 March 2022, which is th were available for issue. The follow Dividends – on 9 March 2022, the 2.25 pence per share in respect of is due to be paid on 14 April 2022 2022. The ex-dividend date is 24 Commitment – on 26 January 2022 €400 million (£336 million) to Oa being on 11 February 2022. Full realisation – on 2 February 2022 TechInsights. OCI's look-through Acquisition – on 2 February 2022 portfolio company. TechInsights, through investment was £34.5 m call from investors, of which OCI's ### Oakley Capital Investments Annual Report 2021 144 GOVERNANCE FINANCIALS GLOSSARY STRATEGIC REPORT ## Directors and Advisers | Directors | Advisers | | | --- | --- | --- | | Caroline Foulger | Administrative Agent* | Legal Adviser as to Bermuda Law | | Chair | Oakley Capital Limited | Conyers Dill & Pearman Limited | | | 3 Cadogan Gate | Clarendon House | Richard Lightowler London SW1X 0AS 2 Church Street United Kingdom Hamilton HM CX Senior Independent Director Bermuda Investment Adviser to the Fiona Beck Administrative Agent Financial Adviser and Broker Independent Director | | Oakley Capital Limited | Liberum Capital Limited | | --- | --- | --- | | Stewart Porter | 3 Cadogan Gate | Level 12, Ropemaker Place | | | London SW1X 0AS | 25 Ropemaker Street | Independent Director United Kingdom London EC2Y 9AR United Kingdom Peter Dubens Legal Adviser Director Auditor Stephenson Harwood 1 Finsbury Circus KPMG Audit Limited Registered office London EC2M 7SH Crown House 5th Floor United Kingdom 4 Par-la-Ville Road 11 Bermudiana Road Hamilton HM08 Pembroke CREST Depositary Bermuda HM 08 Computershare Investor Services PLC Bermuda Branch Registrar PO Box 82 | The Pavilions | Computershare Investor | | --- | --- | | Bridgwater Road | Services (Jersey) Limited | | Bristol BS99 6ZZ | Queensway House | | United Kingdom | Hilgrove Street | St Helier Administrator* Jersey JE1 1ES Channel Islands Oakley Capital Limited* 3 Cadogan Gate London SW1X 0AS * Until 30 June 2021, the Administrator wasMayflower Management Services United Kingdom (Bermuda) Limited. Until 31 December 2021, the Administrative Agent was Oakley Capital Manager Limited. ### Oakley Capital Investments Annual Report 2021 145 STRATEGIC REPORT GOVERNANCE GLOSSARY FINANCIALS ## Glossary and Alternative Performance Measures Administrative Agent Oakley Capital Limited (‘OCL’), in respect of the Company. AIF Alternative Investment Fund; as at 31 December 2021, Oakley Capital Investments Limited is a non-EU AIF. Attribution analysis: movement in NAV 1. Realised gains/(losses) represent the change in realised gains/(losses) during the year and is adjusted to remove the impact and investments of reclassifications from unrealised gains/(losses) to realised gains/(losses) which occurred upon realisations during the year. Unrealised gains/(losses) have also been adjusted accordingly. 2. Realised gains/(losses) include realised gains/(losses) on underlying fund portfolio investments sold in the period, and income and expenses of the underlying fund during the period. 3. Unrealised gains/(losses) include FX on the conversion of period end fund holdings from the Funds’ reporting currency (euros) to Pounds, plus unrealised gains/(losses) on the Funds’ portfolio investments and any change in OCI’s share of fund holdings. Changes in Provisional Profit Allocation (‘Carry’) are apportioned across the realised and unrealised gains. 4. Distributions include redemptions, loan repayments (including accrued interest and arrangement fees) and transfers. Attribution analysis: movement in Realised and unrealised gains/(losses) are presented for the portfolio companies and direct equity investments only. This portfolio companies chart, therefore, excludes realised and unrealised gains/(losses) on the other assets/(liabilities) of the Funds, including income and expenses of the underlying fund, FX on the conversion of period end fund holdings from the Fund’s reporting currency (euros) to pounds and any change in OCI’s share of fund holdings. Auditor KPMG Audit Limited or such other auditor as appointed from time to time. Board / Directors The Board of Directors of the Company. Carry Vehicles The Oakley Funds’ Carry Vehicles are Oakley Capital Founder Member Limited in respect of Fund I, Oakley Capital Founder Member II LP in respect of Fund II, OCPE III Founder Member LP in respect of Fund III, Oakley Capital IV FM SCSp in respect of Fund IV and Oakley Capital Origin FM SCSp in respect of the Origin Fund. Commitments The amount committed by an investor to the Funds whether or not such amount has been advanced in whole or in part. Company / OCI Oakley Capital Investments Limited, a company incorporated with limited liability in Bermuda and registered number 40324. Cost In relation to the cost of investments, this is the open cost of the investment at 31 December 2021, i.e. the investment cost net of amounts realised from partial exits and refinancings, where applicable. DACH region Austria, Germany and Switzerland. EBITDA Earnings before interest, taxation, depreciation and amortisation and is used as the typical measure of portfolio company performance. EV/EBITDA multiple The EV/EBITDA multiple compares a company’s Enterprise Value (‘EV’) to its annual EBITDA. Exchange rate The GBP:EUR exchange rate at 31 December 2021 was £1: €1.1898. Five-year p.a. total return Annualised Total NAV Return per share calculated over a five-year period. Fund facilities This includes debt facilities provided by the Company to the Oakley Funds and to the General Partners of the Oakley Funds. Fund I / Oakley Fund I Oakley Capital Private Equity L.P. ### Oakley Capital Investments Annual Report 2021 146 STRATEGIC REPORT GOVERNANCE GLOSSARY FINANCIALS ## Glossary and Alternative Performance Measures Fund II / Oakley Fund II Those limited partnerships constituting the Fund known as Oakley Capital Private Equity II, comprising Oakley Capital Private Equity II-A L.P., Oakley Capital Private Equity II-B L.P., Oakley Capital Private Equity II-C L.P. and OCPE II Master L.P. Fund III / Oakley Fund III Those limited partnerships constituting the Fund known as Oakley Capital Private Equity III, comprising Oakley Capital Private Equity III-A L.P., Oakley Capital Private Equity III-B L.P., Oakley Capital Private Equity III-C L.P. and OCPE III Master L.P. Fund IV / Oakley Fund IV Those limited partnerships constituting the Fund known as Oakley Capital IV, comprising Oakley Capital IV-A SCSp, Oakley Capital IV-B SCSp, Oakley Capital IV-C SCSp and Oakley Capital IV Master SCSp. General Partners (‘GP’) Oakley Capital I Limited in respect of Fund I (previously Oakley Capital GP Limited), Oakley Capital II Limited in respect of Fund II (previously Oakley Capital GP II Limited) and Oakley Capital III Limited in respect of Fund III (previously Oakley Capital GP III Limited), all exempted companies incorporated in Bermuda. Oakley Capital IV S.à r.l. in respect of Fund IV and Oakley Capital Origin S.à r.l. in respect of the Origin Fund, private limited liability companies incorporated in Luxembourg. IFRS International Financial Reporting Standards. The Consolidated Financial Statements and Notes have been prepared in accordance with IFRS. Investment Adviser Oakley Capital Limited, a company incorporated in England and Wales with registered number 4091922, which is authorised and regulated by the Financial Conduct Authority; or any successor as Investment Adviser of the Oakley Funds. IPO Initial Public Offering. IRR The gross Internal Rate of Return of an investment or Fund. It is the annual compound rate of return on investments. Gross IRR does not reflect expenses to be borne by the relevant fund or its investors, including performance fees, management fees, taxes and organisational, partnership or transaction expenses. Look-through OCI look-through values are calculated using the OCI attributable proportion (determined as the ratio of OCI’s commitments to the respective Oakley Fund to total commitments to that Fund), applied to each investment’s fair value as held in the relevant Oakley Fund, net of any accrued performance fees relating to that investment, and converted using the year-end EUR:GBP exchange rate. LTM Last twelve months. LTM EBITDA growth Increase in EBTDA over the last 12 months of the year ended 31 December 2021. MM Money Multiple which is Total Value divided by Total Cost Invested, illustrating return on capital. NAV Net Asset Value is the value of the Company’s total assets less total liabilities. Oakley The Investment Adviser, being Oakley Capital Limited. Oakley Funds Fund I, Fund II, Fund III, Fund IV and Origin Fund, and (as applicable) any successor Funds. Oakley Group Oakley Capital Limited as Investment Adviser and Administrative Agent, Oakley Capital Holdings S.à r.l., the General Partners, the Fund IV and Origin Fund AIFM and any other AIFM and General Partner of successor Oakley Funds or any additional management or holding entities formed under the control of the current Oakley Group. OCI Oakley Capital Investments Limited. ### Oakley Capital Investments Annual Report 2021 147 STRATEGIC REPORT GOVERNANCE GLOSSARY FINANCIALS ## Glossary and Alternative Performance Measures Ongoing charges Ongoing charges are calculated in accordance with the guidelines issued by the Association of Investment Companies (‘AIC’). They comprise recurring costs, including the operating expenses of the Company, operational services fees paid to the Administrative Agent and OCI’s share of the management fees paid by the underlying Oakley Funds. The calculation specifically excludes expenses, gains and losses relating to the acquisition or disposal of investments, performance-related fees (such as carried interest) and financing charges. This calculation cannot be directly reconciled to OCI’s Financial Statements due to the inclusion of OCI’s share of the management fees paid by the underlying Oakley Funds which is not directly included in OCI’s Financial Statements. Origin Fund Those limited partnerships constituting the Fund known as the Origin Fund, comprising Oakley Capital Origin A SCSp, Oakley Capital Origin B SCSp, Oakley Capital Origin C SCSp and Oakley Capital Origin Master SCSp. SFS The Specialist Fund Segment is a segment of the London Stock Exchange’s regulated Main Market. Total NAV return A measure showing how the Net Asset Value (‘NAV’) per share has performed over a period of time, taking into account both capital returns and dividends paid to shareholders. Calculated as: (increase in NAV + dividends) / opening NAV. Total Portfolio The Total Portfolio is the fair value of OCI’s investments, made up of the Oakley Funds’ investments on a look-through basis, and OCI’s direct investments. This can be reconciled to the NAV as below: £m Total Portfolio £921.6 Other Oakley Fund assets/(liabilities) (£130.0) Other direct investments £7.1 Cash and other £162.8 NAV £961.5 Total Shareholder Return Total Shareholder Return is the financial gain that results from a change in OCI’s share price plus dividends paid by the Company during the year, divided by the initial purchase price of the stock. ### Oakley Capital Investments Annual Report 2021 148 Designed and produced by Friend www.friendstudio.com