3i Group PLC (LSE:III) shares jumped 10% to 2,499p after the private equity investor said its largest holding, Action, was still on track for a solid second quarter despite a moderation in like-for-like sales growth.
Ahead of its annual general meeting, the FTSE 100 firm reported that the European discount retailer posted like-for-like sales growth of 3.3% for the year to 21 June.
That compares with 3.6% growth in the first quarter and sits slightly below previous full-year guidance of 4% to 5%.
Action has opened 105 new stores so far this year, keeping it on track to meet its target of at least 400 openings, according to chief executive Simon Borrows.
He added that Action is expected to deliver “a good quarter of profit growth” and ended the period with a cash balance of €699 million, following a €450 million dividend payout in May.
Borrows also said the rest of 3i’s private equity portfolio continued to perform in line with expectations, with steady underlying momentum across its investments.
3i shares had previously reached an all-time high near 4,500p last autumn, driven by strong performance at Action, before sliding to two-and-a-half-year lows below 1,900p in recent months.
Earlier this month, Citi analysts suggested the market was implicitly pricing Action on just 2.2% medium-term like-for-like sales growth.
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