We believe that Tern’s results announced this morning both vindicate and validate the group’s investment thesis and recent activities. We are impressed at the ability of the group to deliver value to its investee portfolio during these challenging times, and we believe that the current COVID-19 pandemic will see a number of the investees demonstrate their true potential in the respective end markets.
Portfolio company performance The overall growth in portfolio companies’ revenue during 2019 was some 27%, in line with the trading update published in late January. This growth would have been higher, but was impacted by a number of orders which had been expected to sign during Q4 2019, where completion was delayed until this year. Some of these deals have now been completed in early 2020, providing a strong start to this calendar year. The value of the group’s investment holdings rose by some 20%, from £14.9m to £17.9m, and we describe individual newsflow for each investee company in the following pages.
Tern group financial position The group ended 2019 with net cash of £1m, down from £1.9m at the end of the prior year. This delta reflects both operational costs (offset by interest income) and a number of fundraisings and additional investments in portfolio companies.
COVID-19 update Tern has worked effectively during the COVID-19 pandemic to ensure the well-being of its teams, and to provide additional value to investee companies. The group has implemented regular calls between executive teams at the investees, and is providing support for these businesses as they navigate their own routes through the pandemic. We believe that a number of the investee companies will demonstrate real value in the end markets during these challenging times.
Outlook for 2020 The group remains well positioned both to invest additional amounts within the existing portfolio, and to make new investments. The small recent additional fundraising helps reduce near term risk and allows additional follow-on funding to the investee base.
Overall, we see today's results as reassuring evidence of the group's position. Tern is providing value to its investees, and the IoT space in which it invests seems well set to continue its growth over the short, medium and long term. We look forward to additional news flow, both from the group and from its investees, during 2020 and beyond.