Georgia Capital (LON:CGEO) reported third-quarter net asset value growth of 13.6% in Georgian lari terms and 15% in pounds sterling, supported by a rally in Lion Finance Group shares, gains in private portfolio companies and share buybacks.
The company said Lion Finance Group was the largest contributor to quarterly NAV-per-share growth, adding 11.3 percentage points. Private portfolio companies contributed 2.4 percentage points and buybacks added 0.6 percentage points, while operating expenses and liquidity-management effects each reduced NAV growth by 0.2 percentage points.
Management said the holding company had fully repaid its debt and ended September with no debt at the HoldCo level, after paying down its remaining $50 million obligation in August. Georgia Capital reported $111 million in liquid funds at quarter-end.
The company also announced a new $50 million share-buyback program, bringing the total under its new program to $100 million. Management said it had bought back 1 million shares over the previous four months and that nearly 37% of Georgia Capital’s share capital has been repurchased since inception.
Portfolio performance accelerates
Georgia Capital said aggregate revenue across its private portfolio companies increased 18.5% year over year in the third quarter, while EBITDA rose 26.3%. Operating cash flow increased 12.3% during the quarter and was up 26.7% over the first nine months, compared with 24.7% EBITDA growth over that period.
CFO Giorgi Alpaidze said Lion Finance Group’s share price increased nearly 27% during the third quarter, lifting its share of Georgia Capital’s gross portfolio value to 51%, from 47% at the end of the second quarter. The total portfolio value reached a record GEL 6.2 billion at quarter-end, after increasing by nearly GEL 800 million during the quarter.
Lion Finance Group generated GEL 657 million of valuation gains for Georgia Capital in the quarter, while private portfolio companies added GEL 153 million of value. Alpaidze said valuation multiples for private businesses were broadly unchanged, with EBITDA growth, cash generation and debt reduction serving as the principal drivers of value creation.
The company said it expects to receive approximately GEL 200 million in dividend income for the full year. Alpaidze said dividend inflows in 2027 should increase by a double-digit percentage rate and exceed GEL 220 million, subject to the completion of portfolio-company budgets.
Retail pharmacy expands network and margins
Retail Pharmacy Business CEO Tornike Nikolaishvili said the business opened 12 pharmacies in the third quarter, including 10 in Georgia and two in Armenia. As of September, its network comprised 476 pharmacies, 15 Body Shop stores and six optical stores.
Third-quarter retail revenue increased 16% year over year, driven by 8.7% same-store revenue growth. The company said the number of bills issued rose 5% and average bill size increased 10%.
Overall gross profit margin improved by 2 percentage points to 35.4%, while EBITDA rose 34% and the EBITDA margin expanded 1.8 percentage points to 12.7%. Nine-month EBITDA reached GEL 93 million, up 26% from a year earlier. Adjusted net debt to last-12-month EBITDA declined to 0.8x at the end of September from 1.3x at year-end 2025.
The business acquired a distributor of premium baby-care brands for GEL 6 million during the quarter, at an implied EBITDA multiple of 3.5x. In Armenia, third-quarter revenue rose 42% to GEL 10 million. Nikolaishvili said 75% of Armenian growth came from existing operations, wholesale development and government tenders, with the remainder attributable to new outlets and infrastructure.
Healthcare and insurance results
Healthcare Services CEO Irakli Gogia said the business recorded 16% revenue growth and 22% EBITDA growth to GEL 26 million in the third quarter. EBITDA margin increased 1 percentage point to 19.4%, while operating cash flow more than doubled to GEL 25 million.
Outpatient-services revenue rose 23%, aided by the opening in June of a renovated and expanded outpatient department at the group’s largest hospital. Outpatient services represented 48% of net revenue, up from 46% a year earlier.
Georgia Capital plans GEL 53 million of healthcare capital expenditures over the next three years, focused on outpatient services and in vitro fertilization. Management said it is targeting healthcare EBITDA of roughly $80 million to $100 million over three to five years before considering an initial public offering of the business.
Insurance Business CEO Giorgi Baratashvili said insurance revenue rose 30% year over year in both the third quarter and first nine months. Third-quarter profit increased 19%, while nine-month profit was up 29%. The company said property and casualty insurance revenue rose 12% in the quarter, while medical-insurance revenue increased 48%.
Baratashvili said the property and casualty combined ratio was 83% in the third quarter and the medical-insurance combined ratio was 91.7%. He said the company’s medium-term target ranges were 80% to 85% for property and casualty and 90% to 92% for medical insurance.
Capital allocation and outlook
Management said roughly GEL 260 million of its GEL 1 billion capital-return program had either been completed or committed. The program runs through the end of 2029, though the company said it hopes to complete it ahead of schedule.
Georgia Capital said it continues to see its shares as undervalued, citing a NAV discount of more than 25%. Management said buybacks remain attractive when evaluated alongside the group’s growth outlook, while emphasizing that the company does not intend to invest simply to deploy capital.
The company said Georgia’s economy continued to provide a supportive backdrop, citing 7.6% GDP growth over the first eight months and a decline in the current-account deficit to 2.5% in the first half from 5.8% a year earlier. Management also noted that the National Bank’s foreign-exchange reserves exceeded $8 billion after interventions during the second and third quarters.
About Georgia Capital (LON:CGEO)
Georgia Capital PLC (“Georgia Capital” or “the Group” or “GCAP”– LSE: CGEO LN) is a platform for buying, building and developing businesses in Georgia with holdings in sectors that are expected to benefit from the continued growth and further diversification of the Georgian economy. The Group’s focus is typically on larger-scale investment opportunities in Georgia, which have the potential to reach at least GEL 300 million equity value over 3-5 years from the initial investment and to monetise them through exits, as investments mature.
