Private equity group 3i has reported an annual return of almost 27 per cent on its investments in addition to a rise in the value of its assets.
Shares in the company lifted in early trading after the FTSE 100 firm revealed that the total return on shareholders' funds rose to 26.89 per cent for the 12 months to March 31st, up from 22.5 per cent a year earlier.
In a statement 3i confirmed that it made a total return of £1 billion over the year, while revealing that the value of its assets rose from 739 pence to 932 pence a share.
Realised profits climbed to £830 million after the company secured proceeds of £2.4 billion on the sale of its assets, while the overall value of funds under 3i's management rose 25 per cent to £7.1 billion.
The buy-out and venture capital group has proposed a 5.9 per cent increase in its full-year dividend, planning to give 16.1 pence a share to investors.
It is also intending to return a further £800 million to shareholders, partly through the issue of new shares, with the transaction expected to take place in July.
3i did acknowledge that realisations from disposals were expected to slow due to a high level of divestments last year, meaning that the group's portfolio now includes many young companies which will take longer to mature.
Nonetheless, 3i chief executive Philip Yea said the company remained "confident" of reporting further progress in the coming year.
"We continue to see good investment opportunities in our chosen areas, albeit that pricing remains high," he said, stressing that 3i was committed to broadening its investment activities in terms of geography and asset class as a key part of its strategy.
"Although levels of realisations are expected to slow, we remain confident of reporting further good progress in the delivery of our strategy over the year ahead," Mr Yea added.