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AAVC Albion Venture Capital Trust Plc

43.20
0.00 (0.00%)
28 Mar 2024 - Closed
Delayed by 15 minutes
Share Name Share Symbol Market Type Share ISIN Share Description
Albion Venture Capital Trust Plc LSE:AAVC London Ordinary Share GB0002039625 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.00% 43.20 42.20 44.20 43.20 43.20 43.20 0.00 00:00:00
Industry Sector Turnover Profit EPS - Basic PE Ratio Market Cap
Trust,ex Ed,religious,charty 1.78M 125k 0.0009 480.00 60.25M

Albion Ven Cap Trust Albion Venture Capital Trust Plc: Annual Financial Report

27/06/2017 1:06pm

UK Regulatory


 
TIDMAAVC 
 
   Albion Venture Capital Trust PLC 
 
   LEI number: 213800JKELS32V2OK421 
 
   As required by the UK Listing Authority's Disclosure and Transparency 
Rules 4.1 and 6.3, Albion Venture Capital Trust PLC today makes public 
its information relating to the Annual Report and Financial Statements 
for the year ended 31 March 2017. 
 
   This announcement was approved for release by the Board of Directors on 
27 June 2017. 
 
   This announcement has not been audited. 
 
   You will shortly be able to view the Annual Report and Financial 
Statements for the year to 31 March 2017 (which have been audited) at 
www.albion.capital/funds/AAVC. The Annual Report and Financial 
Statements for the year to 31 March 2017 will be available as a PDF 
document via a link in the 'Financial Reports and Circulars' section. 
The information contained in the Annual Report and Financial Statements 
will include information as required by the Disclosure and Transparency 
Rules, including Rule 4.1. 
 
   Investment objective and policy 
 
   The investment strategy of Albion Venture Capital Trust PLC (the 
"Company") is to manage the risk normally associated with investments in 
smaller unquoted companies whilst maintaining an attractive yield, 
through allowing investors the opportunity to participate in a balanced 
portfolio of asset-backed businesses. The Company's investment portfolio 
will thus be structured to provide a balance between income and capital 
growth for the longer term. 
 
   This is achieved as follows: 
 
 
   -- qualifying unquoted investments are predominantly in specially-formed 
      companies which provide a high level of asset backing for the capital 
      value of the investment; 
 
   -- the Company invests alongside selected partners with proven experience in 
      the sectors concerned; 
 
   -- investments are normally structured as a mixture of equity and loan 
      stock. The loan stock represents the majority of the finance provided and 
      is secured on the assets of the portfolio company. Funds managed or 
      advised by Albion Capital Group LLP typically own 50 per cent. of the 
      equity of the portfolio company; 
 
   -- other than the loan stock issued to funds managed or advised by Albion 
      Capital Group LLP, portfolio companies do not normally have external 
      borrowings. 
 
 
   The Company offers tax-paying investors substantial tax benefits at the 
time of investment, on payment of dividends and on the ultimate disposal 
of the investment. 
 
   As defined by the Articles of Association, the Company's maximum 
exposure in relation to gearing is restricted to 10 per cent. of the 
adjusted share capital and reserves. The Directors do not currently have 
any intention to utilise gearing for the Company. 
 
   Background to the Company 
 
   The Company is a venture capital trust which raised a total of GBP39.7 
million through an issue of Ordinary shares in the spring of 1996 and 
through an issue of C shares in the following year. The C shares merged 
with the Ordinary shares in 2001. The Company has raised a further 
GBP26.9 million under the Albion VCTs Top Up Offers since 2011. 
 
   On 25 September 2012, the Company acquired the assets and liabilities of 
Albion Prime VCT PLC ("Prime") in exchange for new shares in the 
Company. Each Prime shareholder received 0.8801 shares in the Company 
for each Prime share that they held at the date of the Merger. 
 
   Financial calendar 
 
 
 
 
Record date for first dividend                                     7 July 2017 
 
  Payment of first dividend                                       31 July 2017 
Annual General Meeting                                    11:00am on 14 August 
                                                                          2017 
 
Announcement of half-yearly results for the six months           December 2017 
 ended 30 September 2017 
Payment of second dividend (subject to Board approval)         31 January 2018 
 
 
   Financial highlights 
 
 
 
 
8.7p    Basic and diluted total return per share for the year 
         ended 31 March 2017 
 
5.0p    Total tax-free dividend per share paid during the 
         year ended 31 March 2017 
 
75.4p   Net asset value per share as at 31 March 2017 
 
220.2p  Total shareholder return since launch to 31 March 
         2017 
 
 
 
 
7.4%  Tax free yield on share price (dividend per annum/share 
       price as at 31 March 2017) 
 
6.4%  Annualised return since launch (without tax relief) 
 
 
 
 
                    31 March 2017       31 March 2016 
                   (pence per share)   (pence per share) 
 
Dividends paid                   5.0                 5.0 
Revenue return                   1.9                 2.0 
Capital return                   6.8                 3.6 
Net asset value                 75.4                72.0 
 
 
 
 
Total shareholder return to 31 March 2017               Ordinary shares 
Total dividends paid during the year ended : 31 March 
 1997                                                              2.00 
 31 March 1998                                                     5.20 
 31 March 1999                                                    11.05 
 31 March 2000                                                     3.00 
 31 March 2001                                                     8.55 
 31 March 2002                                                     7.60 
 31 March 2003                                                     7.70 
 31 March 2004                                                     8.20 
 31 March 2005                                                     9.75 
 31 March 2006                                                    11.75 
 31 March 2007                                                    10.00 
 31 March 2008                                                    10.00 
 31 March 2009                                                    10.00 
 31 March 2010                                                     5.00 
 31 March 2011                                                     5.00 
 31 March 2012                                                     5.00 
 31 March 2013                                                     5.00 
 31 March 2014                                                     5.00 
 31 March 2015                                                     5.00 
 31 March 2016                                                     5.00 
 31 March 2017                                                     5.00 
Total dividends paid to 31 March 2017                            144.80 
 
Net asset value as at 31 March 2017                               75.40 
 
Total shareholder return to 31 March 2017                        220.20 
 
 
 
   The financial summary above is for the Company, Albion Venture Capital 
Trust PLC Ordinary shares only.  Details of the financial performance of 
the C shares and Albion Prime VCT PLC, which have been merged into the 
Company, can be found at the end of this report. 
 
   In addition to the dividends summarised above, the Board has declared a 
first dividend for the year ending 31 March 2018 of 2.5 pence per share 
to be paid on 31 July 2017 to shareholders on the register on 7 July 
2017. 
 
   Notes 
 
 
   -- Dividends paid before 5 April 1999 were paid to qualifying shareholders 
      inclusive of the associated tax credit. The dividends for the year to 31 
      March 1999 were maximised in order to take advantage of this tax credit. 
 
   -- All dividends paid by the Company are paid free of income tax to 
      qualifying shareholders. It is an H.M. Revenue & Customs requirement that 
      dividend vouchers indicate the tax element should dividends have been 
      subject to income tax. Investors should ignore this figure on their 
      dividend voucher and need not disclose any income they receive from a VCT 
      on their tax return. 
 
   -- The net asset value of the Company is not its share price as quoted on 
      the official list of the London Stock Exchange. The share price of the 
      Company can be found in the Investment Companies - VCTs section of the 
      Financial Times on a daily basis. Investors are reminded that it is 
      common for shares in VCTs to trade at a discount to their net asset 
      value. 
 
 
   Chairman's statement 
 
   Introduction 
 
   The results for the year to 31 March 2017 show a total return of 8.7 
pence per share, against 5.6 pence per share for the previous year, and 
net assets of 75.4 pence per share compared to 72.0 pence per share at 
31 March 2016, following the payment of total tax-free dividends of 5 
pence per share. 
 
   It is encouraging that the Company's total return continues for the 
third year to more than cover its dividend of 5 pence per share. This 
has been partly through an increase in the income generated by the 
investment portfolio, which has risen 12 per cent. from the previous 
year.  The principal element, however, has come from capital uplifts; in 
particular the uplift in the third party valuations of our care homes. 
 
   Investment performance and progress 
 
   In general, we have been continuing the task of repositioning the 
portfolio, aimed at a reduced reliance on sectors that are exposed to 
the consumer and business cycle. Healthcare now accounts for 35 per 
cent. of the portfolio, renewable energy accounts for 17 per cent., 
while education continues to account for 7 per cent.. Hotels, meanwhile, 
have reduced from 23 per cent. to 18 per cent.. 
 
   Taking these sectors in turn, Shinfield View, Reading, which is one of 
our three care homes, opened in April 2016. Active Lives Care (trading 
as Cumnor Hill House), which is based in Oxford, opened in June 2016; 
and Ryefield Court, based in Hillingdon in West London, opened in July 
2016. All three care homes are building towards good levels of occupancy, 
at rates significantly higher than originally forecast, leading to 
pleasing uplifts in the independent third party valuations. 
 
   Our renewable energy investments are now mature, other than our biogas 
plant, Earnside Energy, which is currently expanding its capacity. In 
general, it is intended to hold these cash-generative investments for 
the longer term with the aim of providing low risk diversification for 
the investment portfolio as a whole, combined with a strong source of 
income. 
 
   In education, Radnor House Twickenham now has over 400 pupils while 
pupil numbers at Radnor House Sevenoaks, formerly Combe Bank School, 
have already reached 300. 
 
   We continue to review our hotel portfolio with a view to reducing our 
exposure further. Trading at the Holiday Inn Express at Stansted Airport 
has been strong, but the valuation has been reduced in light of a new, 
competing, hotel opening in the summer. Trading at the Crown hotel in 
Harrogate has been similar to prior year while the Stanwell Hotel has 
continued to face challenges. 
 
   With regard to our pubs, our portfolio of units in the North West, 
within Bravo Inns and Bravo Inns II, continues to expand its operations. 
Meanwhile The Charnwood Pub Company (renamed MHS 1 Limited) completed 
the disposal of its pub portfolio. After the year end The Weybridge Club 
Limited (renamed TWCL Limited) sold the assets of its business. 
 
   Results and dividends 
 
   As at 31 March 2017, the net asset value was GBP65.5 million or 75.4 
pence per share, compared to GBP57.0 million or 72.0 pence per share as 
at 31 March 2016, after the payment of total tax-free dividends of 5 
pence per share. The results comprised a total return of 8.7 pence per 
share for the year (2016: 5.6 pence per share), which is made up of a 
1.9 pence per share revenue return (2016: 2.0 pence per share) and a 6.8 
pence per share capital return (2016: 3.6 pence per share). The revenue 
return before taxation was GBP1.8 million compared to GBP1.7 million for 
the year to 31 March 2016. The Company will pay a first dividend of 2.5 
pence per share for the year ending 31 March 2018 on 31 July 2017 to 
shareholders on the register on 7 July 2017, which is in line with the 
Company's current objective of paying a dividend of 5 pence per share 
annually. Thereafter, it is intended that payment of the next dividend 
will be made at the end of January 2018, which was previously paid to 
shareholders in December. 
 
   Risks and uncertainties 
 
   The outlook for the UK economy, continues to be the key risk affecting 
your Company. The forthcoming withdrawal from the European Union may 
have an effect on the Company and its investments, although the extent 
of the effect is not quantifiable at this time. However, we would expect 
the effect to be felt most in those sectors which are most exposed to 
the consumer and business cycle. 
 
   The regulatory environment in which the Company operates has had 
significant input from rules developed within the European Union and it 
is uncertain what changes may occur in a separate UK regulatory 
environment. 
 
   The Company's policy remains that its portfolio companies should not 
normally have external borrowings and for the Company normally to have a 
first charge over portfolio companies' assets. The Board and the Manager 
see this as an important factor in the control of investment risk. 
However, certain portfolio companies may take on external borrowings, 
where the Board considers this will offer a significant benefit to the 
Company. 
 
   A detailed analysis of the other risks and uncertainties facing the 
business is set out in the Strategic report below. 
 
   Board composition 
 
   As you may know, I have been chairman of your Company since its launch 
in 1996 and I have indicated to the Board that I intend to retire at the 
Annual General Meeting in August 2018. Ebbe Dinesen has indicated that 
he would also like to retire, at the Annual General Meeting in 2019. The 
nomination committee is therefore in the process of reviewing candidates 
and announcements of replacements will be made in due course. We believe 
that it will be helpful to have some overlap of new directors joining 
the Board before we retire. To facilitate this, a resolution will be 
proposed at the Annual General Meeting to raise the aggregate annual 
limit for total Directors' fees to GBP150,000, which will facilitate 
increasing the Board's size but will not be used to increase the 
individual Director's fees. 
 
   Albion VCTs Top Up Offers 
 
   The Company raised approximately GBP0.3 million during the year under 
the Albion VCTs Prospectus Top Up Offers 2015/2016 and approximately 
GBP5.6 million under the Albion VCTs Prospectus Top Up Offers 2016/2017, 
with a subsequent GBP0.3 million after the year end. 
 
   The Company announced on 14 June 2017 that, subject to regulatory 
approval, it intends to launch a prospectus top up offer of new ordinary 
shares for subscription in the 2017/2018 and 2018/2019 tax years. Full 
details of the Offer will be contained in a prospectus that is expected 
to be published in early September 2017 and will be available on the 
Albion Capital website (www.albion.capital). 
 
   Share buy-backs 
 
   It remains the Board's primary objective to maintain sufficient 
resources for investment in existing and new portfolio companies and for 
the continued payment of dividends to shareholders. Thereafter, it is 
still the Board's policy to buy back shares in the market, subject to 
the overall criterion that such purchases are in the Company's interest. 
The total value bought in for the year ended 31 March 2017 was 
GBP873,000. Subject to the constraints referred to above and subject to 
first purchasing shares held by the market makers, the Board will target 
such buy-backs to be in the region of a 5 per cent. discount to net 
asset value, so far as market conditions and liquidity permit. 
 
   Continuation as a venture capital trust 
 
   At the 2017 Annual General Meeting shareholders have the opportunity to 
confirm that they wish the Company to continue as a venture capital 
trust. Otherwise the Board is required to make proposals for the 
reorganisation, reconstruction or the orderly liquidation and winding up 
of the Company and present these to the members at a general meeting. 
Those shareholders who have been using their investment in the VCT to 
defer a capital gain should note that, on a return of capital, that gain 
would become chargeable at the prevailing rate of capital gains tax. 
 
   Your Board believes that the Albion VCTs have the potential to be highly 
effective long-term investment vehicles, with strong tax-free dividend 
streams. Therefore, the Board recommends that shareholders should vote 
in favour of the Company continuing as a venture capital trust, as they 
intend to vote in respect of their own shares. Further details regarding 
the resolution can be found in the Directors' report on page 23 of the 
full Annual Report and Financial Statements. 
 
   Outlook and prospects 
 
   We are pleased with the progress made during the course of the year, in 
particular the building up of our healthcare portfolio. Looking forward, 
there are a number of interesting areas for investment in the pipeline 
and we would anticipate further progress in the current year. 
 
   David Watkins 
 
   Chairman 
 
   27 June 2017 
 
   Strategic report 
 
   Investment objective and policy 
 
   The Company's investment policy is to provide investors with the 
opportunity to participate in a balanced portfolio of asset-backed 
businesses. The Company's investment portfolio will thus be structured 
to provide a balance between income and capital growth for the longer 
term. 
 
   This is achieved as follows: 
 
 
   -- qualifying unquoted investments are predominantly in specially-formed 
      companies which provide a high level of asset backing for the capital 
      value of the investment; 
 
   -- the Company invests alongside selected partners with proven experience in 
      the sectors concerned; 
 
   -- investments are normally structured as a mixture of equity and loan 
      stock. The loan stock normally represents the majority of the finance 
      provided and is secured on the assets of the portfolio company. Funds 
      managed or advised by Albion Capital Group LLP typically own 50 per cent. 
      of the equity of the portfolio company; and 
 
   -- other than the loan stock issued to funds managed or advised by Albion 
      Capital Group LLP, portfolio companies do not normally have external 
      borrowings. 
 
 
 
   As defined by the Articles of Association, the Company's maximum 
exposure in relation to gearing is restricted to 10 per cent. of the 
adjusted share capital and reserves. The Directors do not currently have 
any intention to utilise gearing for the Company. 
 
   Current portfolio sector allocation 
 
   The pie chart at the end of this announcement shows the split of the 
portfolio valuation by industrial or commercial sector as at 31 March 
2017. Details of the principal investments made by the Company are shown 
in the Portfolio of investments on pages 16 and 17 of the full Annual 
Report and Financial Statements. 
 
   Direction of portfolio 
 
   The sector analysis of the Company's investment portfolio shows that 
healthcare now accounts for 35 per cent. of the portfolio, compared to 
22 per cent. at the end of the previous financial year, following 
further investments in the Company's three care homes and GBP6.8 million 
uplift in valuations. This may increase further as the care homes 
approach maturity and are revalued in the future. Renewable energy 
accounts for 17 per cent. of the portfolio, but no new investments are 
being made in this sector as they are no longer allowed under VCT rules. 
Hotels accounted for 18 per cent. compared to 23 per cent. at the 
previous year end and the Company is looking to reduce this further. 
 
   Results and dividends 
 
 
 
 
                                                        Ordinary shares 
                                                            GBP'000 
 
Net revenue return for the year ended 31 March 2017               1,510 
Net capital gain for the year ended 31 March 2017                 5,501 
Total return for the year ended 31 March 2017                     7,011 
Dividend of 2.5 pence per share paid on 29 July 2016            (1,987) 
Dividend of 2.5 pence per share paid on 30 December 
 2016                                                           (1,986) 
Unclaimed dividends returned to the Company                           9 
Transferred to reserves                                           3,047 
 
Net assets as at 31 March 2017                                   65,475 
 
Net asset value per share as at 31 March 2017 (pence)              75.4 
 
 
   The Company paid dividends totalling 5.0 pence per share during the year 
ended 31 March 2017 (2016: 5.0 pence per share). The dividend objective 
of the Board is to provide Shareholders with a strong, predictable 
dividend flow, with a dividend target of 5.0 pence per share per year. 
 
   As noted in the Chairman's statement, the Board has declared a first 
dividend of 2.5 pence per share for the year ending 31 March 2018. This 
dividend will be paid on 31 July 2017 to shareholders on the register on 
7 July 2017. 
 
   As shown in the Income statement, the Company's investment income has 
increased to GBP2,381,000 (2016: GBP2,236,000) and the total revenue 
return to equity holders also increased to GBP1,510,000 (2016: 
GBP1,403,000), principally driven by the Company's successful renewable 
energy development programme. Income continues to more than cover 
on-going expenses. Although total income has increased, revenue return 
per share has decreased slightly, to 1.9 pence per share (2016: 2.0 
pence per share), due to the number of new shares issued during the 
year. The capital gain on investments for the year was GBP6,179,000 
(2016: GBP3,203,000), offset by management fees charged to capital and 
the related taxation impact, resulting in a capital return of 6.8 pence 
per share (2016: 3.6 pence per share). The total return was 8.7 pence 
per share (2016: 5.6 pence per share). 
 
   The Balance sheet shows that the net asset value has increased over the 
last year to 75.4 pence per share (2016: 72.0 pence per share), 
reflecting the total return exceeding the level of dividends paid during 
the year. 
 
   The cash flow for the Company has been a net inflow of GBP166,000 for 
the year (2016: inflow GBP1,328,000), reflecting cash inflows from 
operations, disposal proceeds and the issue of Ordinary shares under the 
Albion VCTs Top Up Offers, offset by dividends paid, new investments in 
the year and the buy-back of shares. 
 
   During the year, unclaimed dividends older than twelve years of GBP9,000 
(2016: GBP22,000) were returned to the Company in accordance with the 
terms of the Articles of Association. 
 
   Review of business and future changes 
 
   A review of the Company's business during the year and investment 
performance and progress is contained in the Chairman's statement above. 
The healthcare sector performed particularly well again this year with 
an increase in valuations of GBP6,791,000 (2016: GBP1,517,000). After 
strong increases in previous years, the renewable energy sector saw 
modest increases overall. The hotel sector saw a decrease of GBP944,000 
(2016: GBP524,000 uplift) principally as a result of caution in the 
light of new competition for our hotel at Stansted Airport. The 
education sector saw an increase in valuation of GBP618,000 (2016: 
GBP337,000) as Radnor House Sevenoaks boosted pupil numbers. TWCL 
Limited (previously The Weybridge Club Limited) decreased in valuation 
by GBP145,000 which subsequently sold its business and assets after the 
year end. 
 
   The Company continues with its objective to invest in asset-based 
unquoted companies throughout the United Kingdom, with a view to 
providing both capital growth and a reliable dividend income to 
shareholders over the longer term. The Directors do not foresee any 
major changes in the activity undertaken by the Company in the current 
year. 
 
   Details of significant events which have occurred since the end of the 
financial year are listed in note 19. Details of transactions with the 
Manager are shown in note 5. 
 
   VCT regulation 
 
   The investment policy is designed to ensure that the Company continues 
to qualify and is approved as a VCT by HMRC. In order to maintain its 
status under Venture Capital Trust legislation, a VCT must comply on a 
continuing basis with the provisions of Section 274 of the Income Tax 
Act 2007, details of which are provided in the Directors' report on page 
21 of the full Annual Report and Financial Statements. 
 
 
 
   To comply with EU State aid obligations, rules were introduced under the 
Finance Act (No.2) 2015 and Finance Act 2016, which include: 
 
 
   -- Restrictions over the age of investments; 
 
   -- A prohibition on management buyouts or the purchase of existing 
      businesses; 
 
   -- An overall lifetime investment cap of GBP12 million from tax-advantaged 
      funds into any portfolio company; and 
 
   -- A VCT can only make qualifying investments or certain specified 
      non-qualifying investments such as money market securities and short term 
      deposits. 
 
   While these changes were significant, the Manager's assessment is that 
had they been in place previously they would have affected only a 
relatively small minority of the investments that we have made into new 
portfolio companies over recent years. The Board's current view is that 
there will be no material change in our investment policy as a result. 
 
 
 
   The relevant tests to measure compliance have been carried out and 
independently reviewed for the year ended 31 March 2017. These showed 
that the Company has complied with all tests and continues to do so. 
 
   Future prospects 
 
   The Company's performance record reflects the resilience of the strategy 
outlined above and has enabled the Company to maintain a predictable 
stream of dividend payments to shareholders. The Board believes that 
this model will continue to meet the investment objective and has the 
potential to deliver attractive returns to shareholders in the future. 
 
   Key performance indicators 
 
   The Directors believe that the following key performance indicators, 
which are typical for venture capital trusts and used by the Board in 
its assessment of the Company, will provide shareholders with sufficient 
information to assess how effectively the Company is applying its 
investment policy to meet its objective. The Directors are satisfied 
that the results shown in the following key performance indicators give 
a good indication that the Company is achieving its investment objective 
and policy.  These are: 
 
 
   1. Total shareholder return relative to FTSE All Share Index total return 
      The graph on page 4 of the full Annual Report and Financial Statements 
      shows the Company's total shareholder return against the FTSE All-Share 
      Index total return, in both instances with dividends reinvested. 
 
   2. Net asset value per share and total shareholder return Net asset value 
      increased by 11.7 per cent. (after adding back the 5.0 pence per share in 
      dividends paid) to 75.4 pence per share for the year ended 31 March 2017. 
      Total shareholder return increased by 4.0 per cent. to 220.2 pence per 
      share for the year ended 31 March 2017. 
 
   3. Dividend distributions Dividends paid in respect of the year ended 31 
      March 2017 were 5.0 pence per share (2016: 5.0 pence per share), in line 
      with the Board's dividend objective. Cumulative dividends paid since 
      inception amount to 144.8 pence per Ordinary share and 133.25 pence per 
      historic C share. 
 
   4. Ongoing charges The ongoing charges ratio for the year to 31 March 2017 
      was 2.4 per cent. (2016: 2.5 per cent.). The ongoing charges ratio has 
      been calculated using The Association of Investment Companies' (AIC) 
      recommended methodology. This figure shows shareholders the total 
      recurring annual running expenses (including investment management fees 
      charged to capital reserve) as a percentage of the average net assets 
      attributable to shareholders. The Directors expect the ongoing charges 
      ratio for the year ahead to be approximately 2.4 per cent. The cap on 
      total annual normal expenses, including the management fee, is 3.0 per 
      cent. of the net asset value. 
 
   Gearing 
 
   As defined by the Articles of Association, the Company's maximum 
exposure in relation to gearing is restricted to 10 per cent. of the 
adjusted share capital and reserves. The Directors do not currently have 
any intention to utilise gearing for the Company. On an exceptional 
basis, certain portfolio companies may take on external borrowings, 
where the Board considers this will offer a significant benefit to the 
Company. 
 
   Operational arrangements 
 
   The Company has delegated the investment management of the portfolio to 
Albion Capital Group LLP, which is authorised and regulated by the 
Financial Conduct Authority. Albion Capital Group LLP also provides 
company secretarial and other accounting and administrative support to 
the Company. 
 
   Management agreement 
 
   Under the Management agreement, the Manager provides investment 
management, secretarial and administrative services to the Company. The 
Management agreement can be terminated by either party on 12 months' 
notice. The Management agreement is subject to earlier termination in 
the event of certain breaches or on the insolvency of either party. The 
Manager is paid an annual fee equal to 1.9 per cent. of the net asset 
value of the Company, and an annual secretarial and administrative fee 
of GBP48,711 (2016: GBP48,087) increased annually by RPI.  These fees 
are payable quarterly in arrears. 
 
   In line with common practice, the Manager is also entitled to an 
arrangement fee, payable by each portfolio company, of approximately 2 
per cent. on each investment made and any applicable monitoring fees. 
 
   Management performance incentive 
 
   In order to provide the Manager with an incentive to maximise the return 
to investors, the Company has entered into a management performance 
incentive arrangement with the Manager. Under the incentive arrangement, 
the Company will pay an incentive fee to the Manager of an amount equal 
to 8 per cent. of the excess total return above 5 per cent. per annum, 
paid out annually in cash as an addition to the management fee. Any 
shortfall of the target return will be carried forward into subsequent 
periods and the incentive fee will only be paid once all previous and 
current target returns have been met. 
 
   For the year to 31 March 2017, no incentive fee became due to the 
Manager (2016: GBPnil). 
 
   No further performance fee will become due until the hurdle rate 
comprising net asset value, plus dividends from 31 March 2004, has been 
reached. As of 31 March 2017 the total return from 31 March 2004 
amounted to 166.9 pence per share which compared to the hurdle of 213.3 
pence per share at that date. 
 
   Investment and co-investment 
 
   The Company co-invests with other venture capital trusts and funds 
managed by Albion Capital Group LLP. Allocation of investments is on the 
basis of an allocation agreement which is based, inter alia, on the 
ratio of funds available for investment. 
 
   Evaluation of the Manager 
 
   The Board has evaluated the performance of the Manager based on the 
returns generated by the Company, the continued compliance under venture 
capital trust legislation, the long term prospects of current 
investments, a review of the Management agreement and the services 
provided therein, and benchmarking the performance of the Manager to 
other service providers. The Board believes that it is in the interests 
of shareholders as a whole, and of the Company, to continue the 
appointment of the Manager for the forthcoming year. 
 
   Alternative Investment Fund Managers Directive ("AIFMD") 
 
   The Board has appointed Albion Capital Group LLP as the Company's AIFM 
as required by the AIFMD. 
 
   Social and community issues, employees and human rights 
 
   The Board recognises the requirement under section 414C of the Companies 
Act 2006 (the "Act") to detail information about social and community 
issues, employees and human rights; including any policies it has in 
relation to these matters and effectiveness of these policies. As an 
externally managed investment company with no employees, the Company has 
no policies in these matters and as such these requirements do not 
apply. 
 
   Further policies 
 
   The Company has adopted a number of further policies relating to: 
 
 
   -- Environment 
 
   -- Global greenhouse gas emissions 
 
   -- Anti-bribery 
 
   -- Diversity 
 
 
   and these are set out in the Directors' report on pages 21 and 22 of the 
full Annual Report and Financial Statements. 
 
   Risk management 
 
   The Board carries out a robust assessment of principal risks in which 
the Company operates. The principal risks and uncertainties of the 
Company as identified by the Board and how they are managed are as 
follows: 
 
 
 
 
Risk         Possible consequence                                           Risk management 
Investment   The risk of investment in poor quality assets, which           To reduce this risk, the Board places reliance upon 
and           could reduce the capital and income returns to shareholders,   the skills and expertise of the Manager and its track 
performance   and could negatively impact on the Company's current           record over many years of making successful investments 
risk          and future valuations.                                         in this segment of the market. In addition, the Manager 
              By nature, smaller unquoted businesses, such as those          operates a formal and structured investment appraisal 
              that qualify for venture capital trust purposes, are           and review process, which includes an Investment Committee, 
              more fragile than larger, long established businesses.         comprising investment professionals from the Manager 
                                                                             and at least one external investment professional. 
                                                                             The Manager also invites and takes account of comments 
                                                                             from non-executive Directors of the Company on investments 
                                                                             discussed at the Investment Committee meetings. Investments 
                                                                             are actively and regularly monitored by the Manager 
                                                                             (investment managers normally sit on portfolio company 
                                                                             boards), including the level of diversification in 
                                                                             the portfolio, and the Board receives detailed reports 
                                                                             on each investment as part of the Manager's report 
                                                                             at quarterly board meetings. 
Valuation    The Company's investment valuation methodology is              As described in note 2 of the Financial Statements, 
risk          reliant on the accuracy and completeness of information        the investments held by the Company are classified 
              that is issued by portfolio companies. In particular,          at fair value through profit or loss and valued in 
              the Directors may not be aware of or take into account         accordance with the International Private Equity and 
              certain events or circumstances which occur after              Venture Capital Valuation Guidelines. These guidelines 
              the information issued by such companies is reported.          set out recommendations, intended to represent current 
                                                                             best practice on the valuation of venture capital 
                                                                             investments. These investments are valued on the basis 
                                                                             of forward looking estimates and judgements about 
                                                                             the business itself, its market and the environment 
                                                                             in which it operates, together with the state of the 
                                                                             mergers and acquisitions market, stock market conditions 
                                                                             and other factors. In making these judgements the 
                                                                             valuation takes into account all known material facts 
                                                                             up to the date of approval of the Financial Statements 
                                                                             by the Board. The values of all investments are at 
                                                                             cost (reviewed for impairment) or supported by independent 
                                                                             third party professional valuations. 
VCT          The Company must comply with section 274 of the Income         To reduce this risk, the Board has appointed the Manager, 
approval      Tax Act 2007 which enables its investors to take advantage     which has a team with significant experience in venture 
risk          of tax relief on their investment and on future returns.       capital trust management, used to operating within 
              Breach of any of the rules enabling the Company to             the requirements of the venture capital trust legislation. 
              hold VCT status could result in the loss of that status.       In addition, to provide further formal reassurance, 
                                                                             the Board has appointed Philip Hare & Associates LLP 
                                                                             as its taxation adviser, who report quarterly to the 
                                                                             Board to independently confirm compliance with the 
                                                                             venture capital trust legislation, to highlight areas 
                                                                             of risk and to inform on changes in legislation. Each 
                                                                             investment in a new portfolio company is also pre-cleared 
                                                                             with H.M. Revenue & Customs. 
Regulatory   The Company is listed on The London Stock Exchange             Board members and the Manager have experience of operating 
and           and is required to comply with the rules of the UK             at senior levels within or advising quoted companies. 
compliance    Listing Authority, as well as with the Companies Act,          In addition, the Board and the Manager receive regular 
risk          Accounting Standards and other legislation. Failure            updates on new regulation from its auditor, lawyers 
              to comply with these regulations could result in a             and other professional bodies. The Company is subject 
              delisting of the Company's shares, or other penalties          to compliance checks through the Manager's Compliance 
              under the Companies Act or from financial reporting            Officer. The Manager reports monthly to its Board 
              oversight bodies.                                              on any issues arising from compliance or regulation. 
                                                                             These controls are also reviewed as part of the quarterly 
                                                                             Board meetings, and also as part of the review work 
                                                                             undertaken by the Manager's Compliance Officer. The 
                                                                             report on controls is also evaluated by the internal 
                                                                             auditors. 
Operational  The Company relies on a number of third parties, in            The Company and its operations are subject to a series 
and           particular the Manager, for the provision of investment        of rigorous internal controls and review procedures 
internal      management and administrative functions. Failures              exercised throughout the year. 
control       in key systems and controls within the Manager's business      The Audit Committee reviews the Internal Audit Reports 
risk          could put assets of the Company at risk or result              prepared by the Manager's internal auditors, PKF Littlejohn 
              in reduced or inaccurate information being passed              LLP. On an annual basis, the Audit Committee chairman 
              to the Board or to shareholders.                               meets with the internal audit Partner to provide an 
                                                                             opportunity to ask specific detailed questions in 
                                                                             order to satisfy itself that the Manager has strong 
                                                                             systems and controls in place including those in relation 
                                                                             to business continuity. 
                                                                             In addition, the Board regularly reviews the performance 
                                                                             of its key service providers, particularly the Manager, 
                                                                             to ensure they continue to have the necessary expertise 
                                                                             and resources to deliver the Company's investment 
                                                                             objective and policies. The Manager and other service 
                                                                             providers have also demonstrated to the Board that 
                                                                             there is no undue reliance placed upon any one individual 
                                                                             within Albion Capital Group LLP. 
Economic     Changes in economic conditions, including, for example,        The Company invests in a diversified portfolio of 
and           interest rates, rates of inflation, industry conditions,       companies across a number of industry sectors and 
political     competition, political and diplomatic events and other         in addition often invests a mixture of equity and 
risk          factors could substantially and adversely affect the           secured loan stock in portfolio companies and has 
              Company's prospects in a number of ways.                       a general policy of not normally permitting any external 
                                                                             bank borrowings within portfolio companies. 
                                                                             At any given time, the Company has sufficient cash 
                                                                             resources to meet its operating requirements, including 
                                                                             share buy-backs and follow on investments. 
Market       The market value of Ordinary shares can fluctuate.             The Company operates a share buy-back policy and the 
value of      The market value of an Ordinary share, as well as              Board targets such buy-backs to be in the region of 
Ordinary      being affected by its net asset value and prospective          a 5 per cent. discount to the most recently announced 
shares        net asset value, also takes into account its dividend          net asset value, so far as market conditions and liquidity 
              yield and prevailing interest rates. As such, the              permit. From time to time buy-backs cannot be applied, 
              market value of an Ordinary share may vary considerably        for example when the Company is subject to a close 
              from its underlying net asset value. The market prices         period, or if it were to exhaust its buy-back authorities, 
              of shares in quoted investment companies can, therefore,       which are renewed each year. 
              be at a discount or premium to the net asset value             New Ordinary shares are issued at sufficient premium 
              at different times, depending on supply and demand,            to net asset value to cover the costs of issue and 
              market conditions, general investor sentiment and              to avoid asset value dilution to existing investors. 
              other factors. Accordingly the market price of the 
              Ordinary shares may not fully reflect their underlying 
              net asset value. 
 
   Viability statement 
 
   In accordance with the FRC UK Corporate Governance Code published in 
September 2014 and principle 21 of the AIC Code of Corporate Governance, 
the Directors have assessed the prospects of the Company over three 
years to 31 March 2020. The Directors believe that three years is a 
reasonable period in which they can assess the future of the Company to 
continue to operate and meet its liabilities as they fall due, and is 
also the period used by the Board in the strategic planning process and 
is considered reasonable for a business of our nature and size. The 
three year period is considered the most appropriate given the forecasts 
that the Board require from the Manager and the estimated timelines for 
finding, assessing and completing investments. 
 
   The Directors have carried out a robust assessment of the principal 
risks facing the Company as explained above, including those that could 
threaten its business model, future performance, solvency or liquidity. 
The Board also considered the risk management processes in place to 
avoid or reduce the impact of the underlying risks. The Board focused on 
the major factors which affect the economic, regulatory and political 
environment. The Board considered the role of the Manager and the 
processes that it has in place for dealing with the principal risks. 
 
 
 
   The Board assessed the ability of the Company to raise finance and 
deploy capital.  As explained in this Strategic report the Company's 
income more than covers ongoing expenses. This income should increase as 
our asset-backed investments continue to mature. The portfolio is well 
balanced and geared towards long term growth delivering dividends and 
capital growth to shareholders. In assessing the prospects of the 
Company the Directors have considered the cash flow by looking at the 
Company's income and expenditure projections and funding pipeline over 
the assessment period of three years and they appear realistic. 
 
 
 
   Taking into account the processes for mitigating risks, monitoring costs, 
share price discount, the Manager's compliance with the investment 
objective, policies and business model and the balance of the portfolio 
the Directors have concluded that there is a reasonable expectation that 
the Company will be able to continue in operation and meet its 
liabilities as they fall due over the three year period to 31 March 
2020. 
 
 
 
   This Strategic report of the Company for the year ended 31 March 2017 
has been prepared in accordance with the requirements of section 414A of 
the Act. The purpose of this report is to provide Shareholders with 
sufficient information to enable them to assess the extent to which the 
Directors have performed their duty to promote the success of the 
Company in accordance with section 172 of the Act. 
 
 
 
   On behalf of the Board, 
 
   David Watkins 
 
   Chairman 
 
   27 June 2017 
 
   Responsibility statement 
 
   In preparing these Financial Statements for the year to 31 March 2017, 
the Directors of the Company, being David Watkins, John Kerr, Jeff 
Warren and Ebbe Dinesen, confirm that to the best of their knowledge: 
 
   - summary financial information contained in this announcement and the 
full Annual Report and Financial Statements for the year ended 31 March 
2017 for the Company have been prepared in accordance with United 
Kingdom Generally Accepted Accounting Practice (UK Accounting Standards 
and applicable law) and give a true and fair view of the assets, 
liabilities, financial position and profit and loss of the Company for 
the year ended 31 March 2017 as required by DTR 4.1.12R; 
 
   - the Chairman's statement and Strategic report include a fair review of 
the information required by DTR 4.2.7R (indication of important events 
during the year ended 31 March 2017 and description of principal risks 
and uncertainties that the Company faces); and 
 
   - the Chairman's statement and Strategic report include a fair review of 
the information required by DTR 4.2.8R (disclosure of related parties 
transactions and changes therein). 
 
   A detailed "Statement of Directors' responsibilities" is contained on 
page 25 within the full audited Annual Report and Financial Statements. 
 
   By order of the Board 
 
   David Watkins 
 
   Chairman 
 
   27 June 2017 
 
   Income statement 
 
 
 
 
                                                           Year ended 31 March 2017   Year ended 31 March 2016 
                                                           Revenue  Capital   Total   Revenue  Capital   Total 
                                                     Note  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
 
  Gains on investments                                  3        -    6,179    6,179        -    3,203    3,203 
Investment income                                       4    2,381        -    2,381    2,236        -    2,236 
Investment management fees                              5    (283)    (848)  (1,131)    (246)    (739)    (985) 
Other expenses                                          6    (296)        -    (296)    (287)        -    (287) 
Profit on ordinary activities before tax                     1,802    5,331    7,133    1,703    2,464    4,167 
Tax (charge)/credit on ordinary activities              8    (292)      170    (122)    (300)      148    (152) 
Profit and total comprehensive income attributable 
 to shareholders                                             1,510    5,501    7,011    1,403    2,612    4,015 
Basic and diluted return per share (pence)*            10      1.9      6.8      8.7      2.0      3.6      5.6 
 
 
   * excluding treasury shares 
 
   The accompanying notes form an integral part of these Financial 
Statements. 
 
   The total column of this Income statement represents the profit and loss 
account of the Company. The supplementary revenue and capital columns 
have been prepared in accordance with the Association of Investment 
Companies' Statement of Recommended Practice. 
 
   Balance sheet 
 
 
 
 
                                                  31 March 2017  31 March 2016 
                                            Note     GBP'000        GBP'000 
 
Fixed asset investments                       11         55,473         45,015 
 
Current assets 
Trade and other receivables less than one 
 year                                         13            140          2,139 
Cash and cash equivalents                                10,496         10,330 
                                                         10,636         12,469 
 
Total assets                                             66,109         57,484 
 
Creditors: amounts falling due within one 
year 
Trade and other payables less than one 
 year                                         14          (634)          (529) 
 
 
Total assets less current liabilities                    65,475         56,955 
 
Equity attributable to equityholders 
Called up share capital                       15            951            861 
Share premium                                            24,630         18,374 
Capital redemption reserve                                    7              7 
Unrealised capital reserve                                8,623          1,128 
Realised capital reserve                                  8,743         10,737 
Other distributable reserve                              22,521         25,848 
Total equity shareholders' funds                         65,475         56,955 
 
Basic and diluted net asset value per 
 share (pence)*                               16           75.4           72.0 
 
 
 
   * excluding treasury shares 
 
   The accompanying notes form an integral part of these Financial 
Statements. 
 
   These Financial Statements were approved by the Board of Directors and 
authorised for issue on 27 June 2017, and were signed on its behalf by 
 
   David Watkins 
 
   Chairman 
 
   Company number: 03142609 
 
   Statement of changes in equity 
 
 
 
 
                                                        Called 
                                                          up                 Capital    Unrealised  Realised       Other 
                                                         share    Share     redemption    capital    capital    distributable 
                                                        capital   premium    reserve      reserve    reserve*     reserve*      Total 
                                                       GBP'000   GBP'000     GBP'000     GBP'000     GBP'000      GBP'000      GBP'000 
As at 1 April 2016                                          861    18,374            7       1,128     10,737          25,848   56,955 
Return/(loss) and total comprehensive income for the 
 year                                                         -         -            -       6,165      (664)           1,510    7,011 
Transfer of previously unrealised gains/(losses) on 
 realisations of investments                                  -         -            -       1,330    (1,330)               -        - 
Purchase of treasury shares                                   -         -            -           -          -           (873)    (873) 
Issue of equity                                              90     6,422            -           -          -               -    6,512 
Cost of issue of equity                                       -     (166)            -           -          -               -    (166) 
Net dividends paid (note 9)                                   -         -            -           -          -         (3,964)  (3,964) 
As at 31 March 2017                                         951    24,630            7       8,623      8,743          22,521   65,475 
As at 1 April 2015                                          714     8,228            7     (2,269)     11,522          28,726   46,928 
Return and total comprehensive income for the year            -         -            -       2,343        269           1,403    4,015 
Transfer of previously unrealised gains/(losses) on 
 realisations of investments                                  -         -            -       1,054    (1,054)               -        - 
Purchase of treasury shares                                   -         -            -           -          -           (733)    (733) 
Issue of equity                                             147    10,423            -           -          -               -   10,570 
Cost of issue of equity                                       -     (277)            -           -          -               -    (277) 
Net dividends paid (note 9)                                   -         -            -           -          -         (3,549)  (3,549) 
As at 31 March 2016                                         861    18,374            7       1,128     10,737          25,848   56,955 
 
 
   * These reserves amount to GBP31,264,000 (2016: GBP36,585,000) which is 
considered distributable. 
 
   Statement of cash flows 
 
 
 
 
                                                 Year ended      Year ended 
                                                31 March 2017   31 March 2016 
                                                  GBP'000         GBP'000 
Cash flow from operating activities 
Loan stock income received                              1,941           2,028 
Deposit interest received                                  69             115 
Dividend income received                                   45              81 
Investment management fees paid                       (1,091)           (938) 
Other cash payments                                     (302)           (273) 
Corporation tax paid                                    (127)            (99) 
Net cash flow from operating activities                   535             915 
 
Cash flow from investing activities 
Purchase of fixed asset investments                   (4,521)         (6,430) 
Disposal of fixed asset investments                       572           2,786 
Net cash flow from investing activities               (3,949)         (3,644) 
 
Cash flow from financing activities 
Issue of share capital*                                 7,809           7,886 
Cost of issue of equity                                   (2)             (2) 
Dividends paid                                        (3,424)         (3,094) 
Purchase of own shares (including costs)                (803)           (733) 
Net cash flow from financing activities                 3,580           4,057 
 
Increase in cash and cash equivalents                     166           1,328 
Cash and cash equivalents at start of period           10,330           9,002 
Cash and cash equivalents at end of period             10,496          10,330 
 
Cash and cash equivalents comprise 
Cash at bank and in hand                               10,496          10,330 
Cash equivalents                                            -               - 
Total cash and cash equivalents                        10,496          10,330 
 
 
   *An amount of GBP1,988,000 relating to shares subscribed and allotted on 
31 March 2016 was received during the current year. 
 
   Notes to the Financial Statements 
 
   1. Basis of preparation 
 
   The Financial Statements have been prepared in accordance with the 
historical cost convention, modified to include the revaluation of 
investments, in accordance with applicable United Kingdom law and 
accounting standards, including Financial Reporting Standard 102 ("FRS 
102"), and with the 2014 Statement of Recommended Practice "Financial 
Statements of Investment Trust Companies and Venture Capital Trusts" 
("SORP") issued by The Association of Investment Companies ("AIC"). 
 
   The preparation of the Financial Statements requires management to make 
judgements and estimates that affect the application of policies and 
reported amounts of assets, liabilities, income and expenses. The most 
critical estimates and judgements relate to the determination of 
carrying value of investments at fair value through profit and loss 
(FVTPL). The Company values investments by following the International 
Private Equity and Venture Capital Valuation ("IPEVCV") Guidelines and 
further detail on the valuation techniques used are outlined in note 2 
below. 
 
   Company information can be found on page 2 of the full Annual Report and 
Financial Statements. 
 
   2. Accounting policies 
 
   Fixed asset investments 
 
   The Company's business is investing in financial assets with a view to 
profiting from their total return in the form of income and capital 
growth. This portfolio of financial assets is managed and its 
performance evaluated on a fair value basis, in accordance with a 
documented investment policy, and information about the portfolio is 
provided internally on that basis to the Board. 
 
   In accordance with the requirements of FRS 102, those undertakings in 
which the Company holds more than 20 per cent. of the equity as part of 
an investment portfolio are not accounted for using the equity method. 
In these circumstances the investment is measured at FVTPL. 
 
   Upon initial recognition (using trade date accounting) investments, 
including loan stock, are classified by the Company as FVTPL and are 
included at their initial fair value, which is cost (excluding expenses 
incidental to the acquisition which are written off to the income 
statement). 
 
   Subsequently, the investments are valued at 'fair value', which is 
measured as follows: 
 
 
   -- Investments listed on recognised exchanges are valued at their bid prices 
      at the end of the accounting period or otherwise at fair value based on 
      published price quotations; 
 
   -- Unquoted investments, where there is not an active market, are valued 
      using an appropriate valuation technique in accordance with the IPEVCV 
      Guidelines. Indicators of fair value are derived using established 
      methodologies including earnings multiples, the level of third party 
      offers received, prices of recent investment rounds, net assets and 
      industry valuation benchmarks. Where the Company has an investment in an 
      early stage enterprise, the price of a recent investment round is often 
      the most appropriate approach to determining fair value. In situations 
      where a period of time has elapsed since the date of the most recent 
      transaction, consideration is given to the circumstances of the portfolio 
      company since that date in determining fair value.  This includes 
      consideration of whether there is any evidence of deterioration or strong 
      definable evidence of an increase in value. In the absence of these 
      indicators, the investment in question is valued at the amount reported 
      at the previous reporting date. Examples of events or changes that could 
      indicate a diminution include: 
 
          -- the performance and/or prospects of the underlying business are 
             significantly below the expectations on which the investment was 
             based; 
 
          -- a significant adverse change either in the portfolio company's 
             business or in the technological, market, economic, legal or 
             regulatory environment in which the business operates; or 
 
          -- market conditions have deteriorated, which may be indicated by a 
             fall in the share prices of quoted businesses operating in the 
             same or related sectors. 
 
 
   Investments are recognised as financial assets on legal completion of 
the investment contract and are de-recognised on legal completion of the 
sale of an investment. 
 
   Dividend income is not recognised as part of the fair value movement of 
an investment, but is recognised separately as investment income through 
the other distributable reserve when a share becomes ex-dividend. 
 
   Receivables and payables and cash are carried at amortised cost, in 
accordance with FRS 102. There are no financial liabilities other than 
creditors. 
 
   Investment income 
 
   Equity income 
 
   Dividend income is included in revenue when the investment is quoted 
ex-dividend. 
 
   Unquoted loan stock and other preferred income 
 
   Fixed returns on non-equity shares and debt securities are recognised 
when the Company's right to receive payment and expect settlement is 
established. Where interest is rolled up and/or payable at redemption 
then it is recognised as income unless there is reasonable doubt as to 
its receipt. 
 
   Bank interest income 
 
   Interest income is recognised on an accrual basis using the rate of 
interest agreed with the bank. 
 
   Investment management fees and other expenses 
 
   All expenses have been accounted for on an accruals basis. Expenses are 
charged through the other distributable reserve except the following 
which are charged through the realised capital reserve: 
 
 
   -- 75 per cent. of management fees are allocated to the capital account to 
      the extent that these relate to an enhancement in the value of the 
      investments and in line with the Board's expectation that over the long 
      term 75 per cent. of the Company's investment returns will be in the form 
      of capital gains; and 
 
   -- expenses which are incidental to the purchase or disposal of an 
      investment are charged through the realised capital reserve. 
 
   Performance incentive fee 
 
   In the event that a performance incentive fee crystallises, the fee will 
be allocated between other distributable and realised capital reserves 
based upon the proportion to which the calculation of the fee is 
attributable to revenue and capital returns. 
 
   Taxation 
 
   Taxation is applied on a current basis in accordance with FRS 102. 
Current tax is tax payable (refundable) in respect of the taxable profit 
(tax loss) for the current period or past reporting periods using the 
tax rates and laws that have been enacted or substantively enacted at 
the financial reporting date. Taxation associated with capital expenses 
is applied in accordance with the SORP. 
 
   Deferred tax is provided in full on all timing differences at the 
reporting date. Timing differences are differences between taxable 
profits and total comprehensive income as stated in the financial 
statements that arise from the inclusion of income and expenses in tax 
assessments in periods different from those in which they are recognised 
in the financial statements. As a VCT the Company has an exemption from 
tax on capital gains. The Company intends to continue meeting the 
conditions required to obtain approval as a VCT in the foreseeable 
future. The Company therefore, should have no material deferred tax 
timing differences arising in respect of the revaluation or disposal of 
investments and the Company has not provided for any deferred tax. 
 
   Reserves 
 
   Share premium account 
 
   This reserve accounts for the difference between the price paid for 
shares and the nominal value of the shares, less issue costs. 
 
   Capital redemption reserve 
 
   This reserve accounts for amounts by which the issued share capital is 
diminished through the repurchase and cancellation of the Company's own 
shares. 
 
   Unrealised capital reserve 
 
   Increases and decreases in the valuation of investments held at the year 
end against cost are included in this reserve. 
 
   Realised capital reserve 
 
   The following are disclosed in this reserve: 
 
 
   -- gains and losses compared to cost on the realisation of investments; 
 
   -- expenses, together with the related taxation effect, charged in 
      accordance with the above policies; and 
 
   -- dividends paid to equity holders where paid out by capital. 
 
   Other distributable reserve 
 
   The Special reserve, Treasury share reserve and the Revenue reserve were 
combined in 2012 to form a single reserve named other distributable 
reserve. 
 
   This reserve accounts for movements from the revenue column of the 
Income statement, the payment of dividends, the buy-back of shares and 
other non-capital realised movements. 
 
   Dividends 
 
   Dividends by the Company are accounted for in the period in which the 
dividend is paid or approved at the Annual General Meeting. 
 
   Segmental reporting 
 
   The Directors are of the opinion that the Company is engaged in a single 
operating segment of business, being investment in equity and debt. The 
Company invests in smaller companies principally based in the UK. 
 
   3. Gains on investments 
 
 
 
 
                                                Year ended      Year ended 
                                               31 March 2017   31 March 2016 
                                                 GBP'000         GBP'000 
Unrealised gains on fixed asset investments            6,165           2,343 
Realised gains on fixed asset investments                 14             860 
Gains on investments                                   6,179           3,203 
 
 
   4. Investment income 
 
 
 
 
                                                Year ended      Year ended 
                                               31 March 2017   31 March 2016 
                                                 GBP'000         GBP'000 
Income recognised on investments 
Loan stock interest and other fixed returns            2,277           2,039 
Dividend income                                           45              81 
Bank deposit interest                                     59             116 
                                                       2,381           2,236 
 
 
   Interest income earned on impaired investments at 31 March 2017 amounted 
to GBP120,000 (2016: GBP208,000). 
 
   All of the Company's income is derived from operations in the United 
Kingdom. 
 
   5. Investment management fees 
 
 
 
 
                                                   Year ended      Year ended 
                                                  31 March 2017   31 March 2016 
                                                     GBP'000         GBP'000 
 
  Investment management fee charged to revenue              283             246 
Investment management fee charged to capital                848             739 
                                                          1,131             985 
 
 
   Further details of the Management agreement under which the investment 
management fee is paid are given in the Strategic report. 
 
   During the year, services of a total value of GBP1,180,000 (2016: 
GBP1,033,000), were purchased by the Company from Albion Capital Group 
LLP; this includes GBP1,131,000 (2016: GBP985,000) of investment 
management fee and GBP49,000 (2016: GBP48,000) secretarial and 
administration fee. At the financial year end, the amount due to Albion 
Capital Group LLP in respect of these services disclosed within accruals 
and deferred income was GBP323,000 (2016: GBP282,000). 
 
   As at 31 March 2017 Albion Capital Group LLP holds 25,096 Ordinary 
shares in the Company. 
 
   6. Other expenses 
 
 
 
 
                                                        Year ended      Year ended 
                                                       31 March 2017   31 March 2016 
                                                         GBP'000         GBP'000 
Directors' fees (inc. NIC)                                       100              93 
Secretarial and administration fee                                49              48 
Auditor's remuneration for statutory audit services 
 (exc. VAT)                                                       26              27 
Other administrative expenses                                    121             119 
                                                                 296             287 
 
   7. Directors' fees 
 
   The amounts paid to and on behalf of Directors during the year are as 
follows: 
 
 
 
 
                       Year ended      Year ended 
                      31 March 2017   31 March 2016 
                        GBP'000         GBP'000 
Directors' fees                  92              87 
National insurance                8               6 
                                100              93 
 
 
   The Company's key management personnel are the Directors. Further 
information regarding Directors' remuneration can be found in the 
Directors' remuneration report on page 31 of the full Annual Report and 
Financial Statements. 
 
   8. Tax charge/(credit) on ordinary activities 
 
 
 
 
                      Year ended 31 March 2017        Year ended 31 March 2016 
 
                    Revenue    Capital   Total    Revenue   Capital    Total 
                     GBP'000   GBP'000   GBP'000   GBP'000   GBP'000   GBP'000 
UK corporation tax 
 in respect of 
 current year            351     (170)       181       324     (148)       176 
UK corporation tax 
 in respect of 
 prior year             (59)         -      (59)      (24)         -      (24) 
Total                    292     (170)       122       300     (148)       152 
 
 
 
   Factors affecting the tax charge: 
 
 
 
 
                                                    Year ended      Year ended 
                                                   31 March 2017   31 March 2016 
                                                      GBP'000         GBP'000 
 
  Return on ordinary activities before taxation            7,133           4,167 
 
Tax on profit at the standard rate of 20% (2016: 
 20%)                                                      1,426             833 
 
Factors affecting the charge: 
Non-taxable gains                                        (1,236)           (640) 
Income not taxable                                           (9)            (17) 
Consortium relief in respect of prior years                 (59)            (24) 
                                                             122             152 
 
 
   The tax charge for the year shown in the Income statement is lower than 
the standard rate of corporation tax in the UK of 20 per cent. (2016: 20 
per cent.). The differences are explained above. 
 
   Consortium relief is recognised in the accounts in the period in which 
the claim is submitted to HMRC and is shown as tax in respect of prior 
year. 
 
   Notes 
 
   (i)  Venture Capital Trusts are not subject to corporation tax on 
capital gains. 
 
   (ii) Tax relief on expenses charged to capital has been determined by 
allocating tax relief to expenses by reference to the applicable 
corporation tax rate and allocating the relief between revenue and 
capital in accordance with the SORP. 
 
   (iii)  No deferred tax asset or liability has arisen in the year. 
 
   9. Dividends 
 
 
 
 
                                                                  Year ended    Year ended 
                                                               31 March 2017   31 March 2016 
                                                                     GBP'000     GBP'000 
 
First dividend paid on 31 July 2015 - 2.5 pence per 
 share                                                                     -           1,789 
Second dividend paid on 31 December 2015 - 2.5 pence 
per share                                                                  -           1,782 
First dividend paid on 29 July 2016 - 2.5 pence per 
 share                                                                 1,987               - 
Second dividend paid on 30 December 2016 - 2.5 pence 
per share                                                              1,986               - 
Unclaimed dividends                                                      (9)            (22) 
                                                                       3,964           3,549 
 
 
   In addition to the dividends summarised above, the Board has declared a 
first dividend for the year ending 31 March 2018 of 2.5 pence per share. 
This dividend will be paid on 31 July 2017 to shareholders on the 
register on 7 July 2017. The total dividend will be approximately 
GBP2,179,000. All dividends are paid out of revenue from the other 
distributable reserve. 
 
   During the year, unclaimed dividends older than twelve years of GBP9,000 
(2016: GBP22,000) were returned to the Company in accordance with the 
terms of the Articles of Association. 
 
   10. Basic and diluted return per share 
 
 
 
 
                                                        Year ended 31 March 2017     Year ended 31 March 2016 
                                                       Revenue   Capital    Total  Revenue   Capital    Total 
The return per share has been based on the following 
 figures: 
Return attributable to equity shares (GBP'000)           1,510       5,501  7,011    1,403       2,612  4,015 
Weighted average shares in issue (excluding treasury 
 shares)                                                        80,525,974                  72,020,718 
Return attributable per equity share (pence)               1.9         6.8    8.7      2.0         3.6    5.6 
 
 
   The weighted average number of shares is calculated excluding treasury 
shares of 8,263,188 (2016: 6,954,440). 
 
   There are no convertible instruments, derivatives or contingent share 
agreements in issue, and therefore no dilution affecting the return per 
share. The basic return per share is therefore the same as the diluted 
return per share. 
 
   11. Fixed asset investments 
 
 
 
 
                                                        31 March 2017  31 March 2016 
                                                           GBP'000        GBP'000 
Investments held at fair value through profit or loss 
 Unquoted equity                                               21,900         15,163 
Unquoted loan stock                                            33,573         29,852 
                                                               55,473         45,015 
 
 
 
 
                                                         31 March 2017  31 March 2016 
                                                            GBP'000        GBP'000 
Opening valuation                                               45,015         38,229 
Purchases at cost                                                4,521          6,430 
Disposal proceeds                                                (572)        (2,852) 
Realised gains                                                      14            860 
Movement in loan stock accrued income                              331              4 
Unrealised gains                                                 6,165          2,343 
Closing valuation                                               55,473         45,015 
 
Movement in loan stock accrued income 
Opening accumulated movement in loan stock accrued 
 income                                                            265            261 
Movement in loan stock accrued income                              331              4 
Closing accumulated movement in loan stock accrued 
 income                                                            596            265 
 
Movement in unrealised gains/(losses) 
Opening accumulated unrealised losses                            1,128        (2,269) 
Transfer of previously unrealised losses to realised 
 reserve on realisations of investments                          1,330          1,054 
Unrealised gains                                                 6,165          2,343 
Closing accumulated unrealised gains                             8,623          1,128 
 
Historic cost basis 
Opening book cost                                               43,622         40,239 
Purchases at cost                                                4,521          6,430 
Sales at cost*                                                 (1,888)        (3,047) 
Closing book cost*                                              46,255         43,622 
 
 
   *Included in the sales at cost is the cost after deducting realised 
losses of GBP1,162,000 for TWCL Limited (previously The Weybridge Club 
Limited) and GBP170,000 for MHS 1 Limited (previously The Charnwood Pub 
Company Limited) which are still held at the Balance sheet date. 
 
   The Company does not hold any assets as a result of the enforcement of 
security during the period, and believes that the carrying values for 
both impaired and past due assets are covered by the value of security 
held for these loan stock investments. 
 
   Unquoted fixed asset investments are valued at fair value in accordance 
with the IPEVCV guidelines as follows: 
 
 
 
 
                                                  31 March 2017  31 March 2016 
Valuation methodology                                GBP'000        GBP'000 
Cost (reviewed for impairment)                              823          6,743 
Valuation supported by third party or desktop 
 valuation                                               54,650         38,272 
                                                         55,473         45,015 
 
 
   Full valuations are prepared by independent RICS qualified surveyors in 
full compliance with the RICS Red Book. Desk-top reviews are carried out 
by similarly RICS qualified surveyors by updating previously prepared 
full valuations for current trading and market indices. 
 
   Fair value investments had the following movements between valuation 
methodologies between 31 March 2016 and 31 March 2017: 
 
 
 
 
Change in valuation methodology (2016 to 2017)            Value as at  Explanatory 
                                                        31 March 2017  note 
                                                              GBP'000 
Cost (reviewed for impairment) to Valuation supported           9,113  Third party 
 by third party or desktop valuation                                   valuation 
                                                                       has 
                                                                       recently 
                                                                       taken 
                                                                       place 
 
 
 
   The valuation will be the most appropriate valuation methodology for an 
investment within its market, with regard to the financial health of the 
investment and the IPEVCV Guidelines. The Directors believe that, within 
these parameters, there are no other possible methods of valuation which 
would be reasonable as at 31 March 2017. 
 
   FRS 102 and the SORP requires the Company to disclose the inputs to the 
valuation methods applied to its investments measured at fair value 
through profit or loss in a fair value hierarchy. The table below sets 
out fair value hierarchy definitions using FRS102 s.11.27, which has 
been adopted early. 
 
 
 
 
Fair value hierarchy  Definition 
Level 1               Unadjusted quoted prices in an active market 
Level 2               Inputs to valuations are from observable sources and 
                       are directly or indirectly derived from prices 
Level 3               Inputs to valuations not based on observable market 
                       data 
 
 
   Unquoted equity, preference shares and loan stock are all valued 
according to Level 3 valuation methods. 
 
   Investments held at fair value through profit or loss (Level 3) had the 
following movements in the year to 31 March 2017: 
 
 
 
 
 
                          31 March 2017                    31 March 2016 
                            Unquoted                          Unquoted 
                Equity     loan stock      Total  Equity     loan stock     Total 
                GBP'000     GBP'000      GBP'000  GBP'000     GBP'000     GBP'000 
Opening 
 balance         15,163          29,852   45,015   10,442         27,787   38,229 
Additions           896           3,625    4,521    1,684          4,746    6,430 
Disposal 
 proceeds          (14)           (558)    (572)    (721)        (2,131)  (2,852) 
Debt/equity 
 swap               150           (150)        -        -              -        - 
Accrued loan 
 stock 
 interest             -             331      331        -              4        4 
Realised gains       14               -       14      722            138      860 
Unrealised 
 gains            5,691             474    6,165    3,036          (693)    2,343 
Closing 
 balance         21,900          33,573   55,473   15,163         29,852   45,015 
 
 
   FRS 102 requires the Directors to consider the impact of changing one or 
more of the inputs used as part of the valuation process to reasonable 
possible alternative assumptions.  61 per cent. of the portfolio of 
investments is based on cost or is loan stock, and as such the Board 
considers that the assumptions used for their valuations are the most 
reasonable. The Directors believe that changes to reasonable possible 
alternative assumptions for the valuations of the remainder of the 
portfolio companies could result in an increase in the valuation of 
investments by GBP791,000 or a decrease in the valuation of investments 
by GBP834,000. For valuations based on third party valuations, the Board 
considers that the most significant inputs are earnings multiples and 
market value per room for care homes; which have been adjusted to drive 
the above sensitivities. 
 
   12. Significant interests 
 
   The principal activity of the Company is to select and hold a portfolio 
of investments in unquoted securities. Although the Company, through the 
Manager, will, in some cases, be represented on the board of the 
portfolio company, it will not take a controlling interest or become 
involved in the management. The size and structure of the companies with 
unquoted securities may result in certain holdings in the portfolio 
representing a participating interest without there being any 
partnership, joint venture or management consortium agreement. The 
Company has interests of greater than 20 per cent. of the nominal value 
of any class of the allotted shares in the portfolio companies as at 31 
March 2017 as described below: 
 
 
 
 
 
                  Country      Profit/(loss)     Net assets/    Results      % class        % total 
                     of          before tax     (liabilities)   for year     and share      voting 
  Company      incorporation      GBP'000          GBP'000       ended:        type         rights 
Kew Green 
 VCT 
 (Stansted)                                                    31 August 
 Limited      Great Britain              427            4,873       2016  45.2% Ordinary      45.2% 
G&K Smart 
 Development                                                          31 
 VCT                                                            December 
 Limited      Great Britain             n/a*              319       2015  42.9% Ordinary      42.9% 
The Stanwell 
 Hotel                                                         31 August 
 Limited      Great Britain            (838)          (6,950)       2016  39.2% Ordinary      39.2% 
Shinfield                                                             31 
 Lodge Care                                                     December 
 Limited      Great Britain             n/a*            1,090       2015  35.3% Ordinary      35.3% 
The Crown 
 Hotel 
 Harrogate                                                      31 March 
 Limited      Great Britain            (922)          (8,362)       2016  24.1% Ordinary      24.1% 
Ryefield 
 Court Care                                                     30 April 
 Limited      Great Britain             n/a*            1,004       2016  23.6% Ordinary      23.6% 
Active Lives                                                          31 
 Care                                                           December 
 Limited      Great Britain             n/a*            1,373       2015  22.2% Ordinary      22.2% 
 
 
   *The company files abbreviated accounts which do not disclose this 
information. 
 
   13. Current assets 
 
 
 
 
                                     31 March 2017  31 March 2016 
Trade and other receivables             GBP'000        GBP'000 
Prospectus Top Up Offers proceeds*               -          1,988 
Other receivables                               96            112 
UK corporation tax receivable                   35             24 
Prepayments and accrued income                   9             15 
                                               140          2,139 
 
   *This relates to shares subscribed and allotted on 31 March 2016 with 
monies received after that date. 
 
   The Directors consider that the carrying amount of receivables is not 
materially different to their fair value. 
 
   14. Creditors: amounts falling due within one year 
 
 
 
 
                               31 March 2017  31 March 2016 
                                  GBP'000        GBP'000 
Trade payables                            78             18 
UK Corporation tax payable               181            176 
Accruals and deferred income             375            335 
                                         634            529 
 
 
   The Directors consider that the carrying amount of payables is not 
materially different to their fair value. 
 
   15. Called up share capital 
 
 
 
 
Allotted, called up and fully paid                           GBP'000 
86,081,939 Ordinary shares of 1 penny each at 31 March 
 16                                                              861 
8,974,488 Ordinary shares of 1 penny each issued during 
 the year                                                         90 
95,056,427 Ordinary shares of 1 penny each at 31 March 
 2017                                                            951 
 
6,954,440 Ordinary shares of 1 penny each held in 
 treasury at 31 March 2016                                      (70) 
1,308,748 Ordinary shares purchased during the year 
 to be held in treasury                                         (13) 
8,263,188 Ordinary shares of 1 penny each held in 
 treasury at 31 March 2017                                      (83) 
 
86,793,239 Ordinary shares of 1 penny each in circulation* 
 at 31 March 2017                                                868 
 
 
   * Carrying one vote each 
 
   The Company purchased 1,308,748 Ordinary shares (2016: 1,113,000) to be 
held in treasury at a nominal value of GBP13,000 and a cost of 
GBP873,000 (2016: GBP733,000) representing 1.4 per cent. of its issued 
share capital as at 31 March 2017. The shares purchased for treasury 
were funded from the other distributable reserve. 
 
   The Company holds a total of 8,263,188 shares (2016: 6,954,440) in 
treasury at a nominal value of GBP83,000, representing 8.7 per cent. of 
the issued Ordinary share capital as at 31 March 2017. 
 
   Under the terms of the Dividend Reinvestment Scheme Circular dated 10 
July 2008, the following new Ordinary shares of nominal value 1 penny 
per share were allotted during the year: 
 
 
 
 
                                                                Opening 
                               Aggregate              Issue      market 
                     Number     nominal               price     price on 
          Date of   of shares   value of     Net      (pence   allotment 
        allotment   allotted     shares    invested    per        date 
                                                                (pence 
                                GBP'000    GBP'000   share)    per share) 
     29 July 2016     374,773          4        259     69.5         66.5 
 30 December 2016     377,848          4        265     70.4         67.9 
                      752,621          8        524 
 
 
 
 
   During the year the following new Ordinary shares were allotted under 
the Albion VCTs Prospectus Top Up Offers 2015/2016 and the Albion VCTs 
Prospectus Top Up Offers 2016/2017: 
 
 
 
 
                                                                     Opening 
                              Aggregate                    Issue      market 
                    Number     nominal        Net          price     price on 
         Date of   of shares   value of   consideration    (pence   allotment 
       allotment   allotted     shares      received        per        date 
                                                                     (pence 
                               GBP'000      GBP'000       share)    per share) 
    6 April 2016     107,001          1              76      72.8         66.5 
    6 April 2016     245,265          2             173      72.0         66.5 
    6 April 2016       9,897          -               7      72.4         66.5 
 31 January 2017   1,516,754         15           3,307      71.9         67.0 
 31 January 2017     542,522          5           1,069      72.3         67.0 
 31 January 2017   4,695,695         47             382      72.6         67.0 
   28 March 2017   1,104,733         11             807      75.3         68.0 
                   8,221,867         82           5,821 
 
 
 
   16. Basic and diluted net asset value per share 
 
 
 
 
                                                  31 March 2017  31 March 2016 
Basic and diluted net asset value per share 
 (pence)                                                   75.4           72.0 
 
 
   The basic and diluted net asset value per share at the year end are 
calculated in accordance with the Articles of Association and are based 
upon total shares in issue (less treasury shares) of 86,793,239 Ordinary 
shares (2016: 79,127,499). 
 
   There are no convertible instruments, derivatives or contingent share 
agreements in issue. 
 
   17. Capital and financial instruments risk management 
 
   The Company's capital comprises Ordinary shares as described in note 15. 
The Company is permitted to buy-back its own shares for cancellation or 
treasury purposes, and this is described in more detail in the 
Chairman's statement. 
 
   The Company's financial instruments comprise equity and loan stock 
investments in unquoted companies, cash balances and short term 
receivables and payables which arise from its operations. The main 
purpose of these financial instruments is to generate cash flow and 
revenue and capital appreciation for the Company's operations. The 
Company has no gearing or other financial liabilities apart from short 
term payables. The Company does not use any derivatives for the 
management of its balance sheet. 
 
   The principal risks arising from the Company's operations are: 
 
 
   -- Investment (or market) risk (which comprises investment price and cash 
      flow interest rate risk); 
 
   -- credit risk; and 
 
   -- liquidity risk. 
 
 
   The Board regularly reviews and agrees policies for managing each of 
these risks. There have been no changes in the nature of the risks that 
the Company has faced during the past year and, apart from where noted 
below, there have been no changes in the objectives, policies or 
processes for managing risks during the past year. The key risks are 
summarised below. 
 
   The Company's objectives when managing capital are to safeguard the 
Company's ability to continue as a going concern, so that it can 
continue to provide returns for shareholders and to provide an adequate 
return to shareholders by allocating its capital to assets commensurate 
with the level of risk. 
 
   By its nature, the Company has an amount of capital, at least 70 per 
cent. (as measured under the tax legislation) of which is and must be, 
and remain, invested in the relatively high risk asset class of small UK 
companies within three years of that capital being subscribed. The 
Company accordingly has limited scope to manage its capital structure in 
the light of changes in economic conditions and the risk characteristics 
of the underlying assets. Subject to this overall constraint upon 
changing the capital structure, the group may adjust the amount of 
dividends paid to shareholders, return capital to shareholders, issue 
new shares, or sell assets if so required to maintain a level of 
liquidity to remain a going concern. 
 
   Although, as the Investment Policy implies, the Board would consider 
levels of gearing, there are no current plans to do so. It regards the 
net assets of the Company as the Company's capital, as the levels of 
liabilities are small and the management of them is not directly related 
to managing the return to shareholders. There has been no change in this 
approach from the previous year. 
 
   Investment risk 
 
   As a venture capital trust, it is the Company's specific nature to 
evaluate and control the investment risk of its portfolio in unquoted 
investments, details of which are shown on page 16 of the full Annual 
Report and Financial Statements. Investment risk is the exposure of the 
Company to the revaluation and devaluation of investments. The main 
driver of investment risk is the operational and financial performance 
of the portfolio company and the dynamics of market quoted comparators. 
The Manager receives management accounts from portfolio companies, and 
members of the investment management team often sit on the boards of 
portfolio companies; this enables the close identification, monitoring 
and management of investment risk. 
 
   The Manager and the Board formally review investment risk (which 
includes market price risk), both at the time of initial investment and 
at quarterly Board meetings. 
 
   The Board monitors the prices at which sales of investments are made to 
ensure that profits to the Company are maximised, and that valuations of 
investments retained within the portfolio appear sufficiently prudent 
and realistic compared to prices being achieved in the market for sales 
of unquoted investments. 
 
   The maximum investment risk as at the balance sheet date is the value of 
the fixed investment portfolio which is GBP55,473,000 (2016: 
GBP45,015,000).  Fixed asset investments form 85 per cent. of the net 
asset value as at 31 March 2017 (2016: 79 per cent.). 
 
   More details regarding the classification of fixed asset investments are 
shown in note 11. 
 
   Investment price risk 
 
   Investment price risk is the risk that the fair value of future 
investment cash flows will fluctuate due to factors specific to an 
investment instrument or to a market in similar instruments. To mitigate 
the investment price risk for the Company as a whole, the strategy of 
the Company is to invest in a broad spread of industries with 
approximately two-thirds of the unquoted investments comprising debt 
securities, which, owing to the structure of their yield and the fact 
that they are usually secured, have a lower level of price volatility 
than equity. Details of the industries in which investments have been 
made are contained in the Portfolio of investments section on page 16 of 
the full Annual Report and Financial Statements and in the Strategic 
report. 
 
   Valuations are based on the most appropriate valuation methodology for 
an investment within its market, with regard to the financial health of 
the investment and the IPEVCV Guidelines. 
 
   As required under FRS 102 section 34.29, the Board is required to 
illustrate by way of a sensitivity analysis the degree of exposure to 
market risk. The Board considers that the value of the fixed asset 
investment portfolio is sensitive to a 10 per cent. change based on the 
current economic climate. The impact of a 10 per cent. change has been 
selected as this is considered reasonable given the current level of 
volatility observed both on a historical basis and future expectations. 
 
   The sensitivity of a 10 per cent. increase or decrease in the valuation 
of the fixed asset investments (keeping all other variables constant) 
would increase or decrease the net asset value and return for the year 
by GBP5,547,000 (2016: GBP4,502,000). 
 
   Interest rate risk 
 
   It is the Company's policy to accept a degree of interest rate risk on 
its financial assets through the effect of interest rate changes. On the 
basis of the Company's analysis, it is estimated that a rise of one 
percentage point in all interest rates would have increased total return 
before tax for the year by approximately GBP74,000 (2016: GBP122,000). 
Furthermore, it is considered that a fall of interest rates below 
current levels during the year would have been very unlikely. 
 
   The weighted average effective interest rate applied to the Company's 
fixed rate assets during the year was approximately 7.0 per cent. (2016: 
6.7 per cent.). The weighted average period to maturity for the fixed 
rate assets is approximately 4.6 years (2016: 4.7 years). 
 
   The Company's financial assets and liabilities, all denominated in 
pounds sterling, consist of the following: 
 
 
 
 
                  31 March 
 31 March 2017      2016 
                                        Non-                                      Non- 
                    Fixed   Floating   interest               Fixed   Floating   interest 
                    rate        rate   bearing    Total       rate      rate     bearing    Total 
                   GBP'000   GBP'000   GBP'000    GBP'000    GBP'000   GBP'000   GBP'000    GBP'000 
Unquoted equity          -         -     21,900    21,900          -         -     15,163    15,163 
Unquoted loan 
 stock*             32,987       279        307    33,573     29,116       279        457    29,852 
Receivables **           -         -         96        96          -         -      2,110     2,110 
Current 
 liabilities**           -         -      (452)     (452)          -         -      (353)     (353) 
Cash                     -    10,496          -    10,496          -    10,330          -    10,330 
                    32,987    10,775     21,851    65,613     29,116    10,609     17,377    57,102 
 
   *Including convertible loan stock and debt issued at a discount 
 
   ** The receivables and current liabilities do not reconcile to the 
Balance sheet as prepayments and tax receivable/(payable) are not 
included in the above table. 
 
   Credit risk 
 
   Credit risk is the risk that the counterparty to a financial instrument 
will fail to discharge an obligation or commitment that it has entered 
into with the Company. The Company is exposed to credit risk through its 
receivables, investment in unquoted loan stock, and through the holding 
of cash on deposit with banks. 
 
   The Manager evaluates credit risk on loan stock prior to investment and 
as part of its ongoing monitoring of investments. In doing this, it 
takes into account the extent and quality of any security held. 
Typically loan stock instruments have a first fixed charge or a fixed 
and floating charge over the assets of the portfolio company in order to 
mitigate the gross credit risk. The Manager receives management accounts 
from portfolio companies, and members of the investment management team 
often sit on the boards of portfolio companies; this enables the close 
identification, monitoring and management of investment specific credit 
risk. 
 
   The Manager and the Board formally review credit risk (including 
receivables) and other risks, both at the time of initial investment and 
at quarterly Board meetings. 
 
   The Company's total gross credit risk as at 31 March 2017 was limited to 
GBP33,573,000 (2016: GBP29,852,000) of unquoted loan stock instruments 
(all of which is secured on the assets of the portfolio company), 
GBP10,496,000 cash deposits with banks (2016: GBP10,330,000) and 
GBP96,000 of other receivables (2016: GBP2,100,000). 
 
   As at the Balance sheet date, the cash held by the Company is held with 
Lloyds Bank plc, Scottish Widows Bank plc (part of Lloyds Banking Group), 
Barclays Bank plc and National Westminster Bank plc. Credit risk on cash 
transactions is mitigated by transacting with counterparties that are 
regulated entities subject to prudential supervision, with high credit 
ratings assigned by international credit-rating agencies. 
 
   The Company has an informal policy of limiting counterparty banking and 
floating rate note exposure to a maximum of 20 per cent. of net asset 
value for any one counterparty. 
 
   The credit profile of the unquoted loan stock is described under 
liquidity risk. 
 
   Liquidity risk 
 
   Liquid assets are held as cash on current short term deposit accounts. 
Under the terms of its Articles, the Company has the ability to borrow 
up to 10 per cent. of its adjusted capital and reserves of the latest 
published audited balance sheet, which amounts to GBP6,330,000 as at 31 
March 2017 (2016: GBP5,497,000). 
 
   The Company has no committed borrowing facilities as at 31 March 2017 
(2016: GBPnil) and had cash balances of GBP10,496,000 (2016: 
GBP10,330,000). The main cash outflows are for new investments, buy-back 
of shares and dividend payments, which are within the control of the 
Company. The Manager formally reviews the cash requirements of the 
Company on a monthly basis, and the Board on a quarterly basis as part 
of its review of management accounts and forecasts. All the Company's 
financial liabilities are short term in nature and total GBP634,000 for 
the year to 31 March 2017 (2016: GBP529,000). 
 
   The carrying value of loan stock investments at 31 March 2017 as 
analysed by expected maturity dates is as follows: 
 
 
 
 
                           Fully 
Redemption               performing  Impaired  Past due   Total 
 date                     GBP'000     GBP'000   GBP'000   GBP'000 
 
  Less than one year          4,498     7,326       426    12,250 
1-2 years                       417         -         -       417 
2-3 years                     4,541         -         -     4,541 
3-5 years                     5,334       416       978     6,728 
Greater than 5 years          6,719         -     2,918     9,637 
Total                        21,509     7,742     4,322    33,573 
 
 
   Loan stock can be past due as a result of interest or capital not being 
paid in accordance with contractual terms. 
 
   The average annual interest yield on the total cost of past due loan 
stock is 11.2 per cent. (2016: 12.1 per cent.). 
 
   Impaired loan stock has a cost of GBP10,145,000 (2016: GBP11,065,000). 
 
   The carrying value of loan stock investments at 31 March 2016 as 
analysed by expected maturity dates is as follows: 
 
 
 
 
                           Fully 
                         performing  Impaired  Past due   Total 
Redemption date           GBP'000     GBP'000   GBP'000   GBP'000 
Less than one year            4,875     7,732       383    12,990 
1-2 years                       101         -         -       101 
2-3 years                       407         -         -       407 
3-5 years                     7,693       292       105     8,090 
Greater than 5 years          5,437         -     2,827     8,264 
Total                        18,513     8,024     3,315    29,852 
 
 
   In view of the information shown, the Board considers that the Company 
is subject to low liquidity risk. 
 
   Fair values of financial assets and financial liabilities 
 
   All the Company's financial assets and liabilities as at 31 March 2017 
are stated at fair value as determined by the Directors, with the 
exception of receivables and payables and cash which are carried at 
amortised cost, in accordance with FRS 102. There are no financial 
liabilities other than payables. The Company's financial liabilities are 
all non-interest bearing. It is the Directors' opinion that the book 
value of the financial liabilities is not materially different to the 
fair value and all are payable within one year. 
 
   18. Commitments and contingencies 
 
   The Company had no financial commitments in respect of investments at 31 
March 2017. 
 
   There are no contingent liabilities or guarantees given by the Company 
as at 31 March 2017 (31 March 2016: nil). 
 
   19. Post balance sheet events 
 
   Since 31 March 2017 the Company has had the following post balance sheet 
events: 
 
 
   -- Investment of GBP228,000 in G. Network Communications Limited. 
 
 
   In addition, TWCL Limited (previously The Weybridge Club Limited) 
disposed of its business and assets. 
 
   New Ordinary shares issued under the Albion VCTs Prospectus Top Up 
Offers 2016/2017: 
 
 
 
 
                        Aggregate                                     Opening 
             Number of    nominal        Net                        market price 
    Date of    shares      value     consideration  Issue price          on 
  allotment   allotted   of shares     received      (pence per    allotment date 
                         GBP'000       GBP'000        share)     (pence per share) 
7 April 
 2017           52,543           1              38         74.5               68.0 
7 April 
 2017           29,427           -              22         74.9               68.0 
7 April 
 2017          284,008           3             207         75.3               68.0 
               365,978           4             267 
 
 
   20. Related party transactions 
 
   Other than transactions with the Manager as disclosed in note 5, there 
are no related party transactions or balances requiring disclosure. 
 
   Dividend history for Albion Venture Capital Trust PLC 'C Shares' 
(unaudited) 
 
 
 
 
                                                              C shares 
Total shareholder return to 31 March 2017                 (pence per share) 
Total dividends paid during the year ended : 31 March 
 1998                                                                  2.00 
 31 March 1999                                                         8.75 
 31 March 2000                                                         2.70 
 31 March 2001                                                         4.80 
 31 March 2002                                                         7.60 
 31 March 2003                                                         7.70 
 31 March 2004                                                         8.20 
 31 March 2005                                                         9.75 
 31 March 2006                                                        11.75 
 31 March 2007                                                        10.00 
 31 March 2008                                                        10.00 
 31 March 2009                                                        10.00 
 31 March 2010                                                         5.00 
 31 March 2011                                                         5.00 
 31 March 2012                                                         5.00 
 31 March 2013                                                         5.00 
 31 March 2014                                                         5.00 
 31 March 2015                                                         5.00 
 31 March 2016                                                         5.00 
 31 March 2017                                                         5.00 
Total dividends paid to 31 March 2017                                133.25 
 
Net asset value as at 31 March 2017                                   75.40 
 
Total shareholder return to 31 March 2017                            208.65 
 
 
 
   Notes 
 
 
   -- Dividends paid before 5 April 1999 were paid to qualifying shareholders 
      inclusive of the associated tax credit. The dividends for the year to 31 
      March 1999 were maximised in order to take advantage of this tax credit. 
 
 
   -- All dividends paid by the Company are free of income tax. It is an H.M. 
      Revenue & Customs requirement that dividend vouchers indicate the tax 
      element should dividends have been subject to income tax. Investors 
      should ignore this figure on their dividend voucher and need not disclose 
      any income they receive from a VCT on their tax return. 
 
 
   -- The Ordinary shares and the C shares merged on an equal basis. 
 
 
   Dividend history for Albion Prime VCT PLC now merged with Albion Venture 
Capital Trust PLC (unaudited) 
 
 
 
 
                                                               Proforma 
                                                             Albion Prime 
                                                                VCT PLC 
Total proforma shareholder return to 31 March 2017         (pence per share) 
Total dividends paid during the year 
 ended:                                   31 March 1998                 1.10 
                                          31 March 1999                 6.40 
                                          31 March 2000                 1.50 
                                          31 March 2001                 4.25 
                                          31 March 2002                 2.75 
                                          31 March 2003                 2.00 
                                          31 March 2004                 1.25 
                                          31 March 2005                 2.20 
                                          31 March 2006                 4.50 
                                          31 March 2007                 4.00 
                                          31 March 2008                 5.00 
                                          31 March 2009                 4.50 
                                          31 March 2010                 2.00 
                                          31 March 2011                 3.00 
                                          31 March 2012                 3.00 
                                          31 March 2013                 3.70 
                                          31 March 2014                 4.40 
                                          31 March 2015                 4.40 
                                          31 March 2016                 4.40 
                                          31 March 2017                 4.40 
Total dividends paid to 31 March 2017                                  68.75 
Proforma net asset value as at 31 March 2017                           66.36 
Total proforma shareholder return to 31 March 2017                    135.11 
 
 
   Notes 
 
 
   -- The proforma shareholder returns presented above are based on the 
      dividends paid to shareholders before the merger and the pro-rata net 
      asset value per share and pro-rata dividends per share paid to 31 March 
      2017. This proforma is based upon 0.8801 Albion Venture Capital Trust PLC 
      shares for every Albion Prime VCT PLC share which merged with Albion 
      Venture Capital Trust PLC on 25 September 2012. 
 
   -- Dividends paid before 5 April 1999 were paid to qualifying shareholders 
      inclusive of the associated tax credit. The dividends for the year to 31 
      March 1999 were maximised in order to take advantage of this tax credit. 
 
   -- The above table excludes the tax benefits investors received upon 
      subscription for shares in the Company. 
 
 
   Split of portfolio by sector: 
http://hugin.info/141809/R/2115678/805089.pdf 
 
   This announcement is distributed by Nasdaq Corporate Solutions on behalf 
of Nasdaq Corporate Solutions clients. 
 
   The issuer of this announcement warrants that they are solely 
responsible for the content, accuracy and originality of the information 
contained therein. 
 
   Source: Albion Venture Capital Trust PLC via Globenewswire 
 
 
  http://www.closeventures.co.uk 
 

(END) Dow Jones Newswires

June 27, 2017 08:06 ET (12:06 GMT)

Copyright (c) 2017 Dow Jones & Company, Inc.

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