Foresight VCT PLC Foresight Vct Plc : Annual Financial Report

 
TIDMFTV 
 
 
   FORESIGHT VCT PLC 
 
   Summary Financial Highlights 
 
 
   -- Net asset value per Ordinary Share at 31 December 2016 was 83.6p after 
      payment of a 7.0p dividend (31 December 2015: 87.5p). 
 
   -- Net asset value per Planned Exit Share at 31 December 2016 was 25.9p 
      after a payment of a 14.0p dividend (31 December 2015: 36.8p). 
 
   -- Net asset value per Infrastructure Share at 31 December 2016 was 81.7p 
      after payment of 14.5p in dividends (31 December 2015: 92.4p). 
 
 
   Ordinary Shares fund 
 
 
   -- An interim dividend for the year ended 31 December 2015 of 7.0p per 
      Ordinary Share was paid on 1 April 2016. 
 
   -- An interim dividend for the year ended 31 December 2016 of 5.0p per 
      Ordinary Share was paid on 3 April 2017. 
 
   -- The fund realised GBP0.6 million from the sale of two portfolio 
      companies. 
 
   -- The fund invested GBP4.8 million in two new portfolio companies. 
 
   -- A further GBP37.0 million was raised through the issue of shares from the 
      2016 offer which closed on 23 December 2016. 
 
   -- The Manager agreed to lower its annual management fee for the Ordinary 
      Shares fund to 1% in respect of any cash above GBP20 million held within 
      the fund. 
 
 
   Planned Exit Shares fund 
 
 
   -- An interim dividend for the year ended 31 December 2016 of 14.0p per 
      Planned Exit Share was paid on 14 October 2016. 
 
   -- An interim dividend for the year ended 31 December 2017 of 18.0p per 
      Planned Exit Share was paid on 13 April 2017. 
 
   -- The fund realised GBP1.4 million from the sale of Trilogy Communications. 
 
   -- AlwaysOn was sold after the year end, realising GBP2.0 million. 
 
 
   Infrastructure Shares fund 
 
 
   -- An interim dividend for the year ended 31 December 2015 of 2.5p per 
      Infrastructure Share was paid on 11 March 2016. 
 
   -- An interim dividend for the year ended 31 December 2016 of 12.0p per 
      Infrastructure Share was paid on 23 September 2016. 
 
   -- The fund realised GBP4.0 million from the sale of FS Pentre. 
 
   -- Three portfolio companies were restructured following the merger with 
      Foresight 2 VCT, generating GBP3.2 million. 
 
 
   Chairman's Statement 
 
   The following statement is divided into three sections, each dealing 
with the performance of specific share funds within the Company. 
 
   1. The Ordinary Shares Fund 
 
   Introduction and Strategy 
 
   During the period under review, the net assets of the Ordinary Shares 
fund increased to GBP107.0 million at 31 December 2016 from GBP75.8 
million at 31 December 2015 following a successful new fund raise. The 
net asset value per share at 31 December 2016 was 83.6p, which, after 
taking into account the 7.0p per share dividend paid in April last year, 
is an increase of 3.5% on the 87.5p per share at 31 December 2015. 
 
   The Directors believe that the Ordinary Shares fund is beginning to 
demonstrate the benefits of actions taken over the past five years to 
significantly expand the size of the fund and refocus its investments on 
developing businesses. At the year end the fund held 28 investments in 
UK based businesses across a wide spread of sectors and had over GBP39 
million of cash available for further investment. 
 
   The Directors believe that it is in the best interests of Ordinary 
Shareholders for the Company to continue to pursue its existing strategy 
which includes the following four key objectives: 
 
 
   -- Further increase of the net assets of the Ordinary Shares fund to a level 
      in excess of GBP150 million. 
 
   -- Entering into a significant number of new and follow on qualifying 
      investments every year. 
 
   -- Paying an annual dividend to Shareholders of at least 5.0p per share and 
      at the same time aiming to maintain or increase net asset value per 
      share. 
 
   -- Offering a programme of regular share buy backs at a discount in the 
      region of 10% to the prevailing net asset value. 
 
 
   Investment Opportunities 
 
   The Directors believe that central to the Company being able to achieve 
its objectives in the future is the ability of Foresight Group, the 
Company's manager (the "Manager"), to source and complete attractive new 
qualifying investment opportunities. This task has not been made easier 
by the changes to VCT legislation which (amongst other requirements) 
place greater emphasis on growth or development capital investment into 
younger companies. 
 
   The Company is fortunate, however, in that it has pursued a policy of 
seeking growth capital investments for several years with the Manager 
having established a successful track record in this area. Foresight 
Group was recently awarded 'VCT House of the Year 2016' at the Unquote 
awards in recognition of investments made and the achievements of team 
members and the Manager as a whole throughout 2016. 
 
   In addition to its established reputation in the area of growth and 
development capital investment, the Manager has been developing a number 
of UK regional funds supporting early stage businesses. The first two 
funds which are based in Nottingham and Manchester are already proving a 
useful source of attractive new investment leads for the Company. The 
Company completed two new investments amounting to GBP4.8 million last 
October and has concluded three further transactions totalling GBP6.8 
million in 2017. Taking into account the current pipeline of new 
investment opportunities, it is the Manager's expectation that it will 
be able to increase the level of new investments over the coming year 
and beyond. 
 
   Cash Availability and Charges 
 
   By the time it closed last December, the Company's 2016 share offer 
raised approximately GBP37 million. In line with its strategy for the 
expansion of the overall size of the fund, the Board and the Manager are 
looking to build on that success and raise further funds to support the 
Company's investment programme. A prospectus offer to raise GBP20 
million was launched on 2 February 2017 and was rapidly oversubscribed. 
The Board utilised the over-allotment facility for a further GBP20 
million and capacity was reached, with the offer closing to further 
applications on 20 March 2017. 
 
   At the year end, the Ordinary Shares fund had cash and liquid resources 
of GBP39.4 million with the 2017 share offer adding significantly to 
this sum. The Directors believe that it is right to hold substantial 
funds available for future investment but in order to mitigate the full 
cost impact of this, the Manager recently agreed to lower the annual 
management charge to 1% in respect of any cash above GBP20 million held 
within the fund. This reduced rate will be reviewed by the Board on an 
annual basis. 
 
   Annual Running Costs 
 
   The annual management fee of the Ordinary Shares fund is 2.0% of net 
assets including cash balances up to GBP20 million. The average ongoing 
charges of the Ordinary Shares fund for the period to 31 December 2016, 
at 2.1% of net assets, compares favourably with its VCT peer group and 
is subject to a cap at 2.4% of net assets, which is amongst the lowest 
for any generalist VCT with total assets in excess of GBP20 million. 
 
   The Board remains committed to keeping the Company's operating costs as 
low as possible and the funds raised under the Offer will serve to 
increase the Company's net assets overall while allowing the Company's 
fixed administrative costs to be spread across a wider asset base, thus 
reducing costs per share. 
 
   Performance Incentive 
 
   As stated at the time of the merger with Foresight 2 VCT, the Directors 
consider that a performance incentive scheme should help to incentivise 
the Manager to deliver above average value for Shareholders. In addition, 
the Directors believe it to be advantageous to align the interests of 
the Manager with those of Shareholders. New arrangements were approved 
by Shareholders on 8 March 2017 and have been entered into whereby 
individual members of the Manager's private equity team and the Manager 
will invest alongside the Ordinary Shares fund, and may become entitled 
to performance incentive payments, subject to the achievement of 'per 
investment' and 'fund as a whole' performance hurdles. 
 
   Details of these arrangements can be found on page 60 of the Annual 
Report and Accounts. 
 
   Dividends 
 
   The Board is pleased that the Company has been able to maintain its 
annual dividend payments at or above its target of 5.0p per Ordinary 
Share for the past six years and expects to maintain this in the future. 
The Company's dividend policy is, and will remain wherever practical, to 
maintain a steady flow of tax-free dividends, generated from income or 
capital profits realised on the sale of investments. 
 
   In accordance with this policy an interim dividend of 5.0p was paid on 3 
April 2017 based on an ex-dividend date of 16 March 2017 and a record 
date of 17 March 2017. 
 
   Buybacks 
 
   The Board and the Manager consider that the ability to offer to buyback 
shares at a discount in the region of 10% is a benefit to Shareholders 
as a whole and an appropriate way to help manage the share price 
discount to NAV at which the Ordinary Shares trade. 
 
   Outlook 
 
   The Directors are optimistic that investments currently within the 
Company's Ordinary Shares fund have the potential to show further growth 
over the coming year and that new investment opportunities being sourced 
by the Manager will add to this potential. The fund is well positioned 
to provide Shareholders with regular dividends and sustained capital 
value in the future. 
 
   2. Planned Exit Shares Fund 
 
   During the period under review, the net assets of the Planned Exit 
Shares fund decreased to GBP2,949,000 at 31 December 2016 from 
GBP4,248,000 at 31 December 2015. The net asset value per share at 31 
December 2016 was 25.9p which, after taking into account the 14.0p per 
share dividend paid on 14 October 2016 is an increase of 8.4% on the 
36.8p per share at 31 December 2015. Total return since launch, however, 

remains significantly behind expectations. 
 
   The Board was particularly pleased with the realisation of Trilogy 
Communications, which was sold in August 2016, as it represented a 
significant turnaround in Trilogy's fortunes and demonstrates the 
benefit of active asset management for private equity style investments. 
Details of the sale can be found in the Manager's Report. 
 
   Cash Availability 
 
   At the year end, the Planned Exit Shares fund had cash and liquid 
resources of GBP135,000. 
 
   Running Costs 
 
   The annual management fee of the Planned Exit Shares fund is 1.0% of net 
assets. The average ongoing charges ratio of the Planned Exit Shares 
fund for the period ended 31 December 2016 was 1.9% of net assets. 
 
   Dividends 
 
   It continues to be the Company's policy to provide a flow of dividends 
which will be tax-free to qualifying shareholders, generated from income 
and from capital profits realised on the sale of investments. 
Distributions, however, will inevitably be dependent on cash being 
generated from portfolio investments and successful realisations. 
 
   In accordance with this policy an interim dividend of 18.0p per Planned 
Exit Share was paid on 13 April 2017 based on an ex-dividend date of 30 
March 2017 and a record date of 31 March 2017. 
 
   Buybacks 
 
   The Board and the Manager consider share buybacks to be an effective way 
to manage the share price discount to NAV at which the Planned Exit 
Shares trade. 
 
   Outlook 
 
   The original objective of the Planned Exit Shares fund was to return 
investors 110p per share through a combination of dividends and share 
buybacks by the sixth anniversary of the closure of the original offer, 
which was June 2016. 
 
   Following the sale of AlwaysOn in January 2017, there is now one final 
investment held within the Planned Exit Shares portfolio and it 
continues to be the Board's policy to manage this investment in order to 
maximise the return for Shareholders. 
 
   The total return for Shareholders if the fund realised the remaining 
investment at current valuation would be 82.9p (comprising 57.0p in 
dividends paid to date and 25.9p representing the remaining NAV at 31 
December 2016). To deliver the target return of 110p per share, a 
significant increase on the current valuation of the remaining 
investment would need to be achieved on disposal. The Directors consider 
that it is highly unlikely that the present total return will improve 
materially. 
 
   3. Infrastructure Shares Fund 
 
   During the period under review, the net assets of the Infrastructure 
Shares fund decreased to GBP26.6 million at 31 December 2016 from 
GBP30.0 million at 31 December 2015. The net asset value per share at 31 
December 2016 was 81.7p which, after taking into account the 2.5p per 
share dividend paid on 11 March 2016 and the 12.0p per share dividend 
paid on 23 September 2016, represented an increase of 4.1% over the year 
on the 92.4p per share at 31 December 2015. 
 
   Following the merger with Foresight 2 VCT plc in December 2015, the 
Company had a controlling holding in four of the five currently 
qualifying Infrastructure Shares fund investments. Left unaddressed 
these holdings would have become non-qualifying under VCT rules relating 
to control. A one year grace period was allowed to remedy this 
situation. Partial or complete disposals of these four investments to 
reduce ownership of each of holding to below 50% were completed during 
the year. Details of these disposals can be found in the Manager's 
Report. 
 
   Cash Availability 
 
   At the year end the Infrastructure Shares fund had cash and liquid 
resources of GBP2.8 million as a result of the partial disposals made in 
December 2016. 
 
   Running Costs 
 
   The annual management fee of the Infrastructure Shares fund is 1% of net 
assets. The ongoing charges ratio of the fund for the period ended 31 
December 2016 was 1.7% of net assets. 
 
   Dividends 
 
   The Company's original objective was to provide an annual flow of 
dividends of 5.0p per share, tax-free to qualifying shareholders, 
generated from income and from capital profits realised on the sale of 
investments. Distributions are inevitably dependent on cash being 
generated from portfolio investments and successful realisations. Whilst 
the underlying capital value of each investment remains largely 
unaltered, they are not able to generate sufficient cashflows to satisfy 
an annual 5.0p per share dividend at current yields. 
 
   Buybacks 
 
   The Board and the Manager consider share buybacks to be an effective way 
to help manage the share price discount to NAV at which the 
Infrastructure Shares trade. 
 
   Outlook 
 
   The Board is conscious of the intention stated in the original 
Infrastructure Shares fund prospectus to offer Shareholders the 
opportunity to exit their investment after the end of the initial five 
year holding period and is writing to Infrastructure Shareholders 
regarding this intent. 
 
   Brexit 
 
   There are two principal areas where the implementation of Brexit could 
impact the Company: 
 
 
   1. Investee Companies - there has been much debate on the possible impact on 
      trade between Europe and the UK following the Brexit vote and how this 
      will impact UK businesses. It is too early to estimate the impact that 
      this may have; 
 
   2. Regulation - recent additions to the current VCT legislation have 
      resulted from EU State Aid Directives, but we do not believe that post 
      Brexit the amending of VCT legislation will be a priority for the UK 
      Government. 
 
   Annual General Meeting 
 
   The Company's Annual General Meeting will take place on 23 May 2017 at 
10.00am. I look forward to welcoming you to the Meeting, which will be 
held at the offices of Foresight Group in London. Details can be found 
on page 70 of the Annual Report and Accounts. 
 
   Outlook 
 
   The Ordinary Shares fund is now of a size that the Directors believe 
should more easily achieve the objectives of regular dividend payments 
and continuing new investment. The Directors believe sound future 
investment is fundamental to underpin long term performance. We are 
encouraged by the performance of the portfolio over the last year and 
pleased with the progress made by several recent investments. In 
addition, the pipeline of potential investments contains a number of 
interesting opportunities. 
 
   The Board is looking to realise and distribute the final investment in 
the Planned Exit Shares fund as soon as practical and has already 
embarked upon an exit strategy for the Infrastructure Shares fund 
portfolio. 
 
   John Gregory 
 
   Chairman 
 
   Telephone: [phone] 
 
   Email: [e-mail] 
 
   24 April 2017 
 
   Manager's Report 
 
   Fund raising for the Ordinary Shares Fund 
 
   On 18 January 2016, the Board launched a full prospectus to raise up to 
GBP30 million by the issue of new Ordinary Shares. The issue was well 
received by both new and existing investors, and the offer was increased, 
raising a total of GBP37 million by the closing date of 23 December 
2016. 
 
   While the VCT market adjusted to the changes in regulation announced in 
2015, as noted in previous reports, investment activity was relatively 
quiet in the first half of the year. Foresight Group, however, has 
continued to see a flow of investment opportunities from small high 
quality companies and subsequently, in late 2016 and early 2017, we have 
seen a particularly strong pick-up in the pipeline. With the UK and US 
economies continuing their recovery, we believe that investing in 
growing, well managed private companies should, based on past experience, 
generate attractive returns over the longer term. 
 
   To address the large number of high quality private equity investment 
opportunities, we have continued to expand our private equity team, 
which is now based in London, Manchester and Nottingham. The team now 
totals 17 investment professionals with combined industry experience of 
more than 220 years. Foresight Group has invested in more than 20 small 
companies since 2012 with more than 20 follow-on investments made to 
fund further growth. 
 
   All members of the team spend significant time connecting with SME 
networks around the country, targeting advisers and marketing directly 
to businesses to identify high quality opportunities across a diverse 
range of market segments. Foresight Group's focus remains on identifying 
strong management teams with growing businesses across a range of 
sectors. The enlarged team enables efficient deal execution while 
maintaining and developing the flow of new opportunities via both 
intermediary referrals and direct targeting. 
 
   To take advantage of current investment opportunities, on 2 February 
2017, the Board launched a further full prospectus to raise up to GBP20 
million with a facility to increase by a further GBP20 million. The 
offer was closed to further applications on 20 March 2017, raising the 
full GBP40 million. 
 
   Portfolio Review: Ordinary Shares Fund 
 
 
 
 
New Investments 
Company                    GBP 
Idio Limited              782,500 
Simulity Labs Limited   4,000,000 
Total                   4,782,500 
 
 
   In October 2016, the Company invested GBP782,500 in content intelligence 
platform Idio, a high growth, recurring revenue-led, enterprise Software 
as a Service ("SaaS") business. 
 
   Also in October 2016 the Company completed a GBP4 million growth capital 
investment in Simulity Labs, a specialist technology business based in 
Bangor, North Wales, powering the future of connected devices and the 
Internet of Things (IOT) through its embedded communications software 
for SIM, eSIM and next generation connected products. 
 
   The Ordinary Shares fund continues to focus on new opportunities, 
although uncertainty following the changes to VCT rules and HMRC delays 
on providing advance assurances resulted in a delay in the completion of 
new deals. Following the year end, however, a further three new 

investments totalling GBP6.8 million were completed in Poundshop.com, 
the UK's largest online pound shop, Ollie Quinn Limited, a designer and 
retailer of subscription glasses and sunglasses and Fresh Relevance, an 
ecommerce platform for online retailers. We are currently in exclusivity 
and in due diligence on one new investment for the Ordinary Shares fund, 
with offers on funding under negotiation for several other investments. 
 
   Follow-on funding 
 
   The final GBP94,503 tranche of an investment round to finance the 
development of Biofortuna's new molecular diagnostics products was drawn 
down in July 2016. 
 
   Realisations 
 
   Realisations totalling GBP673,176 were completed during the year. 
 
   These included the Company's interest in O-Gen Acme Trek, which was sold 
in March 2016 to Blackmead Infrastructure Limited, a subsidiary of 
Foresight's Inheritance Tax Solution, at book value for an initial cash 
consideration of GBP45,442 and a deferred consideration element due when 
certain conditions are met. The majority of this deferred consideration 
was received in January 2017. 
 
   In August 2016, the Company successfully completed the sale of Trilogy 
Communications Limited to California based Clear-Com LLC. The Ordinary 
Shares fund received GBP575,667 in cash following completion (as 
compared with a carrying value of GBP337,264 at 31 March 2016), with 
further deferred consideration payable subject to warranty claims and 
tax claims. 
 
   During the year, 56,538 ordinary shares in AIM listed ZOO Digital were 
sold, realising GBP5,036. 
 
   A short term loan of GBP45,000 was repaid to the fund by Specac 
International. 
 
   Loan repayments of GBP2,030 were received from the administrators of The 
Skills Group Limited, formerly AtFutsal Group Limited. 
 
   The final tranche of deferred consideration was received from iCore 
Limited, totalling GBP51,247. 
 
   Provisions to a level below cost (including take-on cost) in the year 
 
 
 
 
Company                                        GBP 
Autologic Diagnostics Group Limited        (3,268,957) 
alwaysON Group Limited                       (547,620) 
Hospital Services Group Limited              (402,747) 
Positive Response Communications Limited     (328,662) 
TFC Europe Limited                           (230,337) 
ICA Group Limited                            (186,648) 
ABL Investments Limited                       (57,889) 
Total                                      (5,022,860) 
Material valuation uplifts in the year 
Company                                            GBP 
Datapath Group Limited                       3,614,255 
Specac International Limited                 2,047,328 
Protean Software Limited                     1,585,450 
Procam Television Holdings Limited           1,167,624 
Itad Limited                                   757,914 
The Business Advisory Limited                  582,014 
FFX Group Limited                              381,220 
Total                                       10,135,805 
 
 
   Further investee company details are provided in the Portfolio 
Highlights section. 
 
   Portfolio Review: Planned Exit Shares Fund 
 
   In line with the fund's objective at this time, no new or follow-on 
investments were made during the year. 
 
   In August 2016 the Company successfully completed the sale of Trilogy 
Communications Limited to California based Clear-Com LLC. The Planned 
Exit Shares fund received GBP1,374,912 in cash following completion 
(compared with a carrying value of GBP799,029 at 31 March 2016), with 
further deferred consideration payable subject to warranty claims and 
tax claims. This result represents a remarkable turnaround in Trilogy's 
fortunes and demonstrates the benefit of active asset management by the 
Foresight Group investment management team. 
 
   The final tranche of deferred consideration was received from Channel 
Safety Systems Limited, totalling GBP13,367. 
 
   Following the year end the Company sold its investment in alwaysOn Group 
Limited, realising a further GBP2,032,608 for the Planned Exit Shares 
fund. 
 
   Material Provisions to a level below cost (including take-on cost) in 
the year 
 
 
 
 
Company                                     GBP 
Industrial Engineering Plastics Limited   831,658 
Total                                     831,658 
 
 
   Slower than expected progress in the turnaround of Industrial 
Engineering Plastics has led to a further reduction in the holding value 
of the investment. This is the final investment held in the fund and we 
continue to work on securing a realisation which will maximise value for 
investors. 
 
   Portfolio Review: Infrastructure Shares Fund 
 
   As a consequence of the merger of the Company and Foresight 2 VCT in 
December 2015, at the beginning of 2016 the Infrastructure Shares Fund 
held controlling positions in four of its five qualifying investments. 
To avoid these investments becoming non-qualifying under VCT regulations, 
complete and partial disposals were successfully concluded within the 
twelve month grace period. 
 
   On 1 July 2016, the fund successfully completed the sale of FS Pentre 
Limited, the holding company of the Pentre solar farm project, for 
GBP4.0 million, which represented a premium of GBP0.4 million above book 
value. Pentre was sold to a Foresight Group managed investment vehicle 
for this attractive premium reflecting an independent third party 
valuation. 
 
   In December 2016, partial disposals of the three remaining qualifying 
holdings were made to a fund managed by Foresight Group at an 
independently verified valuation. This reduced the fund's shareholding 
to below the qualification threshold in the Drumglass High School PFI 
project in Northern Ireland, and two ground mounted solar projects, FS 
Tope and FS Hayford Farm. 
 
 
 
 
                           Proceeds 
  Investee Company           (GBP)    Fully Diluted Ownership 31 December 2016 
Drumglass HoldCo Limited   1,361,685                                    49.99% 
FS Hayford Farm Limited      388,948                                    49.99% 
FS Pentre Limited          3,996,337                                         - 
FS Tope Limited            1,491,673                                    49.99% 
Total                      7,238,643 
 
 
   Following the fifth anniversary of the last allotment of shares in the 
fund in July 2017 it is proposed to offer Shareholders the opportunity 
to realise their holdings. 
 
   The Board and Manager have given consideration to current investment 
opportunities and whether any sale proceeds should be reinvested. It was 
concluded that any sales proceeds should (subject to VCT implications 
for both the Company and Shareholders) be distributed to Shareholders. 
The rationale being that the asset type which can be held within the 
fund is of a nature suited to longer term investment. The Board and 
Manager believe that Shareholders individually are in the best position 
to decide on what form of future investment is most suited to their 
needs. 
 
   Portfolio Highlights 
 
   ABL Investments Limited ("ABL"), based in Wellingborough, Northants and 
with a manufacturing subsidiary in Serbia, manufactures and distributes 
office power supplies and distributes monitor arms, cable tidies and CPU 
holders to office equipment manufacturers and distributors across the 
UK. The company has continued to achieve strong growth and good 
profitability. Production facilities have largely been brought in house, 
enabling the Serbian operation to expand its production offering. ABL 
continues to improve its sales reach by expanding its dealer network and 
its range of products. The reduced valuation reflects the updated 
valuation methodology, which is now based on a multiple of the company's 
earnings. Held in the Ordinary Shares fund. 
 
   Aerospace Tooling Corporation ("ATL") provides repair, refurbishment and 
remanufacturing services for components in high-specification aerospace 
and turbine engines, serving the aerospace, military, marine and 
industrial markets. In September 2014 the company effected a 
recapitalisation and dividend distribution which returned the entire 
initial GBP1.5 million cost of this investment to the Ordinary Shares 
fund while retaining the original equity shareholding. Subsequently, ATL 
faced reduced orders from its two largest customers in 2015 and incurred 
significant EBITDA losses for its financial year to June 2016. This poor 
trading was reflected in the reduction in value during the year. In 
January 2016, a new experienced CEO was appointed, who has made solid 
progress, returning the company to positive EBITDA during the second 
half of calendar 2016. Held in the Ordinary Shares fund. 
 
   alwaysOn Group provides data backup services, connectivity and 
Microsoft's Skype for Business collaboration software to SMEs and larger 
enterprises. For the financial year to 30 June 2016, a small EBITDA loss 
was incurred on reduced sales of GBP5.5 million. Given the company's 
cash constraints, a decision was made to seek an exit rather than fund 
further losses. Despite challenging trading conditions the sale was 
completed in January 2017, with proceeds of GBP2.033 million going to 
the Planned Exit Fund. Held in the Ordinary Shares and Planned Exit 
Shares funds. 
 
   Aquasium Technology designs, manufactures and markets bespoke electron 
beam welding and vacuum furnace equipment and related services. The 
company has continued to perform well in its core markets, and there is 
good visibility over the pipeline for the current financial year. The 
company has continued the development of its disruptive reduced pressure 
vacuum electron beam welding technology, Ebflow. The sales cycle for 
this disruptive technology is protracted in nature, requiring further 
investment in marketing and business development activities. The 
investment in Aquasium has to date returned GBP3.8 million, representing 
a multiple of over 2.0x cost. Held in the Ordinary Shares fund. 
 
   Autologic Diagnostics Group produces software-based automotive 

diagnostic tools. In May 2015, a new business model was launched to 
generate recurring revenues and improve the quality of the company's 
earnings from a new product, Assist Plus, and associated Assist Plus 
service. This change in strategy towards a pure recurring revenue model 
resulted in certain exceptional costs being incurred, impacting EBITDA 
during 2015 and 2016. It is likely that profits will remain depressed 
until revenues from the new software focused model can be delivered, 
which is anticipated to occur later this year. Accordingly, the 
valuation of the company has been reduced significantly. Held in the 
Ordinary Shares fund. 
 
   Biofortuna is a molecular diagnostics business based in the North West 
which develops and sells its own proprietary freeze dried DNA tests as 
well as developing and manufacturing products on behalf of customers. A 
funding round was completed in August 2013, in which the Ordinary Shares 
fund invested GBP99,066 and a further GBP50,929 invested in April 2014. 
To finance the development of new products, a GBP1.6 million round was 
concluded in January 2015, of which GBP890,000 was committed by the 
Foresight VCTs. The Ordinary Shares fund invested GBP128,002 in the 
first tranche. The final tranche for this round, totaling GBP94,503, was 
drawn down in July 2016. For the year to 31 March 2016, trading was 
ahead of budget, with the profitable Contract Manufacturing division 
helping offset investment in the proprietary products being developed by 
the Molecular Diagnostics division. To finance continuing growth and 
product development, a further funding round is expected during 2017. 
Held in the Ordinary Shares fund. 
 
   Blackstar Amplification Holdings is the number two guitar amplifier 
brand by units sold in the UK and USA. The company currently has a 
presence in over 35 countries and its products are stocked in over 2,500 
stores globally. During the year, the company has been strengthening its 
international distributor network, and continued to invest heavily into 
new product development, which, while impacting short term profitability, 
should result in improved trading performance towards the end of this 
fiscal year. The company's valuation has been reduced to reflect this 
short term impact. Held in the Ordinary Shares fund. 
 
   O-Gen UK is a leading developer of Advanced Conversion Technology waste 
to energy projects. In March 2015, O-Gen UK and Una Group combined their 
two teams into a new company, CoGen Limited to develop their pipeline of 
projects. In April 2016, the company bought 42.5% of the sub-debt and 
21.25% of the equity in an existing plant in Avonmouth, redeveloping the 
site using technology provided by Nexterra, a medium size technology 
provider in which the company holds 50% of the shares, while retaining 
the 2 ROC accreditation. The Birmingham Bio Power plant, a 9MW waste 
wood gasification plant in which the company holds shares, reached take 
over in July 2016 and is now in the optimisation and testing period. 
Construction is substantially complete on the GBP53 million Welland 
project and cold commissioning is taking place. The building and civils 
works are also essentially complete at the GBP98 million Ince Park 
project enabling installation work to begin. CoGen is actively working 
on its pipeline of other projects and funding relationships, with active 
support from Foresight Group and the Bioenergy Infrastructure Group 
("BIG") of which Foresight is a sponsor. Held in the Ordinary Shares 
fund. 
 
   Derby-based Datapath Group is a world leading innovator in the field of 
computer graphics and video-wall display technology utilised in a number 
of international markets. In November 2015, prior to the merger with 
Foresight 2 VCT, Datapath paid dividends of GBP6.3 million, split 
equally between Foresight 2 VCT, Foresight 3 VCT and Foresight 4 VCT, 
such that each fund has now received back 3x the original investment. 
The company is performing well across all product ranges, geographies 
and end markets, driven by the recently implemented product range 
refresh, and strengthening of the sales function following the 
recruitment of a new head of sales. Held in the Ordinary Shares fund. 
 
   FFX Group Limited is a Folkestone-based multi-channel distributor of 
power tools, hand tools, fixings and other building products. Since 
launching its e-commerce channel in 2011, FFX has grown rapidly 
supplying a wide range of tools to builders and tradesmen nationally. 
The company continues to benefit from the successful relocation to a 
larger warehouse in early 2016. Following the post-Brexit fall in 
sterling FFX anticipates passing price increases onto customers in line 
with the market. FFX's own brand range of fixings was launched in early 
2017 and the team is optimistic about its potential. Held in the 
Ordinary Shares fund. 
 
   Flowrite Refrigeration Holdings provides refrigeration and air 
conditioning maintenance and related services nationally, principally to 
leisure and commercial businesses such as hotels, clubs, pubs and 
restaurants. In July 2015, the company completed another 
recapitalisation taking total cash returned on this investment to 85% of 
cost. Following the appointment of a new senior team, the company has 
reduced costs and is delivering operational improvements. Held in the 
Ordinary Shares fund. 
 
   Hospital Services Limited ("HSL"), based in Belfast and Dublin, 
distributes, installs and maintains high quality healthcare equipment as 
well as supplying related consumables. HSL has delivered organic growth 
through service revenues and accessory sales as well as capital sales. 
In July 2016, the company acquired Eurosurgical, a specialist in 
surgical equipment, instruments and devices. Held in the Ordinary Shares 
fund. 
 
   ICA Group is a document management solutions provider in the South East 
of England, reselling and maintaining office printing equipment to 
customers in the commercial and public sectors. Trading in the year to 
31 January 2016 was in line with expectations and reflected continuing 
investment in developing the sales team. A new chairman, well-known to 
Foresight Group and with a strong sales and marketing background, joined 
the board in November 2016. Held in the Ordinary Shares fund. 
 
   Industrial Efficiency II provides energy efficiency fuel switching 
services, enabling customers to make significant cost savings and reduce 
emissions and the company receives a percentage of these savings. 
Following the successful completion of all sites, energy savings are 
broadly in-line with expectations at the time of investment, and the 
company is now generating revenues in line with forecasts. Held in the 
Ordinary Shares fund. 
 
   Industrial Engineering Plastics ("IEP") is a long established plastics 
distributor and fabricator supplying a wide range of industries 
nationally, principally supplying ventilation and pipe fittings, plastic 
welding rods, hygienic wall cladding, plastic tanks and sheets. 
Following increased competition in its plastics distribution and 
industrial fabrication markets, performance deteriorated during 2014 and 
a new Chairman and experienced turnaround CEO were appointed. 
Performance subsequently improved due to an increased focus on higher 
margin fabrication work. IEP continues to operate in a market where 
distribution sales remain under pressure due to significant competition, 
limited differentiation and low margin products. Reflecting this, the 
valuation has been reduced by GBP831,658, while Foresight Group 
continues to work with management to explore options for the business. 
Following the sale of alwaysOn in January 2017, the company is the final 
investment held in the Planned Exit Shares fund. Held in the Planned 
Exit Shares fund. 
 
   Itad Limited is a long established consulting firm which monitors and 
evaluates the impact of international development and aid programmes, 
largely in developing countries. Customers include the UK Government's 
Department for International Development, other European governments, 
philanthropic foundations, charities and international NGOs. The company 
continues to make strong progress, is trading ahead of budget, and has 
good visibility over future revenues due to the long term nature of some 
projects. The company has benefited from exchange rate changes following 
the Brexit vote and the team has carefully managed overhead increases. 
Held in the Ordinary Shares fund. 
 
   Ixaris Systems has developed EntroPay, a web-based global prepaid 
payment service using the VISA network. Ixaris also offers its Systems 
product to enable enterprises to develop their own customised global 
payment applications. The company has seen strong progress in both 
business areas, with the Systems division growing rapidly in the year 
and the Entropay business continuing to generate high levels of EBITDA. 
Held in the Ordinary Shares fund. 
 
   Positive Response Communications monitors the safety of people and 
property through its 24 hour monitoring centre. Customers include 
several major restaurant and retail chains. Following disappointing 
performance, a new CEO with a background in the security industry was 
appointed in January 2017, alongside a new FD. A review of the cost base 
of the business has been undertaken, with actions taken to bring the 
company back to positive EBITDA. Held in the Ordinary Shares fund. 
 
   Procam Television Holdings, headquartered in London with operations in 
Manchester and Scotland, is one of the UK's leading broadcast hire 
companies, supplying equipment and crews to broadcasters and production 
companies including BskyB, the BBC and ITV. Procam has acquired True 
Lens Services (2014), HotCam New York (2015) and the trading assets of 
the film division of Take 2 Films (2016). Revenues and profits have 
grown strongly following the introduction of new camera formats, 
acquisitions in both the UK and USA and increased sales and marketing 
efforts. The London headquarters have been successfully moved to a 

larger facility to support the ongoing growth of the business. Held in 
the Ordinary Shares fund. 
 
   Protean Software develops and sells business management and field 
service management software, together with related support and 
maintenance services across sectors including elevator installation, 
facilities management and heating, ventilation and air conditioning 
("HVAC"). Protean continues to trade well, and will be launching its 
SaaS product during 2017. As the business sells more licences on a 
subscription basis, revenues, cash and operating profit will decrease in 
the near term but this should materially benefit medium-long term 
performance and shareholder value. Held in the Ordinary Shares fund. 
 
   In November 2016, the Company completed a GBP4 million growth capital 
investment in Simulity Labs, a specialist technology business, powering 
the future of connected devices and the Internet of Things (IOT) through 
its embedded communications software for SIM, eSIM and next generation 
connected products. The company has seen rapid growth, with revenues 
increasing eight fold in the past four years. The Company's investment 
will support Simulity's expansion into new markets which are 
complementary to its existing mobile network operator customers. Held in 
the Ordinary Shares fund. 
 
   Specac International, based in Kent, is a long established, leading 
scientific instrumentation accessories business, manufacturing sample 
analysis and preparation equipment used in testing, research and quality 
control laboratories. The company's products are primarily focused on 
supporting IR Spectroscopy, an important analytical technique widely 
used in research and commercial/ industrial laboratories. Trading in the 
year to 31 March 2016 exceeded expectations with profit growth ahead of 
forecast, reflecting the increased focus on sales and costs, with this 
positive momentum continuing in the current year. Held in the Ordinary 
Shares fund. 
 
   Trading at TFC Europe, a leading distributor of technical fasteners in 
the UK and Germany, suffered in the year to 31 March 2016 due to a 
general downturn in the UK manufacturing sector, most particularly the 
oil and gas industry. In the current financial year, however, the 
company is trading ahead of budget and prior year. A new, experienced 
Chairman joined in January 2016 and key initiatives have included 
strengthening the sales team, development of new product ranges and 
supplier price renegotiations. Improvements to a number of the company's 
facilities are planned for Q1 2017 including larger, better located 
premises and the opening of a new branch in the South East to service 
existing customers and target new clients. Held in the Ordinary Shares 
fund. 
 
   The Bunker Secure Hosting, which operates two ultra-secure data centres, 
continues to deliver solid performance and the pipeline remains healthy 
for both new and existing clients. The Bunker commenced its core network 
upgrade project in the period which involved a major capex programme to 
be able to support customers with more resilient control systems within 
the data centres. The projects are now largely complete with minimal 
issues encountered. Held in the Ordinary Shares fund. 
 
   The Business Advisory Limited provides advice and support services to 
UK-based small businesses seeking to gain access to Government 
incentives, such as R&D tax credits. The company enjoys a high level of 
recurring income and good visibility on future revenues. The company has 
made good progress in improving its internal processes and the 
indicators are positive for the current year. Held in the Ordinary 
Shares fund. 
 
   Thermotech Solutions is a facilities management provider that designs, 
installs and services air conditioning and fire sprinkler systems for 
retail, commercial and residential properties. Since investment, good 
progress has been made in diversifying and rebalancing the spread of 
revenues, with greater emphasis placed on service and maintenance. In 
July 2016, Thermotech acquired Oakwood, a well-respected local 
competitor which continues to perform well. The combined group benefits 
from greater scale, a national footprint and a reduction in customer 
concentration. Held in the Ordinary Shares fund. 
 
   Russell Healey 
 
   Head of Private Equity 
 
   Foresight Group 
 
   24 April 2017 
 
   Strategic Report 
 
   Introduction 
 
   This Strategic Report, on pages 20 to 26 of the Annual Report and 
Accounts, has been prepared in accordance with the requirements of 
Section 414 of the Companies Act 2006 and best practice. Its purpose is 
to inform the members of the Company and help them to assess how the 
Directors have performed their duty to promote the success of the 
Company, in accordance with Section 172 of the Companies Act 2006. 
 
   Foresight VCT plc Ordinary Shares Fund 
 
   Foresight VCT plc originally raised GBP10.9 million through an Ordinary 
Share issue in the 1997/98 tax year. At 31 December 2016, this fund had 
investments and assets totalling GBP107.2 million, of which a 
significant portion was held in cash and was available to make new 
investments. The number of Ordinary Shares in issue at 31 December 2016 
was 127,985,288. 
 
   Foresight VCT plc Planned Exit Shares fund 
 
   In the 2009/10 tax year, GBP12 million was raised through a linked offer 
for the Planned Exit Shares fund, the proceeds of which were divided 
equally between Foresight VCT plc and Foresight 2 VCT plc. These Funds 
comprised separate share classes within Foresight VCT plc and Foresight 
2 VCT plc with their own investments and income streams, and were 
combined following the merger in December 2015. 
 
   The number of Planned Exit shares in the Company in issue at 31 December 
2016 was 11,404,314. 
 
   Foresight VCT plc Infrastructure Shares fund 
 
   In the 2011/2012 tax year, GBP33 million was raised through a linked 
offer for the Infrastructure Shares fund, the proceeds of which were 
divided equally between Foresight VCT plc and Foresight 2 VCT plc. These 
Funds comprised separate share classes within Foresight VCT plc and 
Foresight 2 VCT plc with their own investments and income streams, and 
were combined following the merger in December 2015. 
 
   The number of Infrastructure Shares in the Company in issue at 31 
December 2016 was 32,495,246. 
 
   Summary of the Investment Policy 
 
   The Company will target investments in UK unquoted companies which it 
believes will achieve the objective of producing attractive returns for 
Shareholders. 
 
   Investment Objectives 
 
   Ordinary Shares fund 
 
   The investment objective of the Ordinary Shares fund is to provide 
private investors with attractive returns from a portfolio of 
investments in fast-growing unquoted companies in the United Kingdom. 
 
   Planned Exit Shares fund 
 
   The investment objective of the Planned Exit Shares fund is to combine 
greater security of capital than is normal within a VCT with the 
enhancement of investor returns through the VCT tax benefits - income 
tax relief of 30% of the amount invested, and tax-free distribution of 
income and capital gains. The key objective of the Planned Exit Shares 
fund is to distribute 110p per share through a combination of tax-free 
income, buy-backs and tender offers before the sixth anniversary of the 
closing date of the original offer. 
 
   Infrastructure Shares fund 
 
   The investment objective of the Infrastructure Shares fund is to invest 
in companies which own and operate essential assets and services which 
enjoy long-term contracts with strong counterparties or through 
government concessions. To ensure VCT qualification, the Manager will 
focus on companies where the provision of services is the primary 
activity and which generate long-term contractual revenues, thereby 
facilitating the payment of regular and predictable dividends to 
investors. 
 
   Performance and Key Performance Indicators (KPIs) 
 
   The Board expects the Manager to deliver a performance which meets the 
objectives of the three classes of shares. The KPIs covering these 
objectives are growth in net asset value per share and dividend payments, 
which, when combined, give net asset value total return. An additional 
key performance indicator reviewed by the Board includes the total 
expenses as a proportion of shareholders' funds. 
 
   A record of some of these indicators is contained on the following page. 
The ongoing charges ratio for the period for the Company as a whole was 
2.0% of net assets. Share buy-backs have been completed at discounts 
ranging from 10.1% to 11.5% for Ordinary Shares, 7.7% to 9.1% for 
Planned Exit Shares and 0.7% for Infrastructure Shares. 
 
   A review of the Company's performance during the financial period, the 
position of the Company at the period end and the outlook for the coming 
year is contained within the Manager's Report. The Board assesses the 
performance of the Manager in meeting the Company's objective against 
the primary KPIs highlighted above. 
 
   Clearly, in the Ordinary Share fund, investments in unquoted companies 
at an early stage of their development may disappoint. Investing the 
funds raised in companies with high growth characteristics, however, 
with the potential to become strong performers within their respective 
fields creates an opportunity for enhanced returns to Shareholders. 
 
   31 December 2016                                                 31 December 2015 
 
 
 
 
 
                                                 Planned                            Planned 
                                       Ordinary   Exit    Infrastructure  Ordinary   Exit    Infrastructure 
                                        Shares   Shares       Shares       Shares   Shares       Shares 
Net asset value per share               83.6p     25.9p       81.7p        87.5p     36.8p       92.4p 
Net asset value total return            216.7p    82.9p       103.7p       215.5p    79.8p       99.9p 
 
                                                 Planned                            Planned 

                                       Ordinary   Exit    Infrastructure  Ordinary   Exit    Infrastructure 
                                        Shares   Shares       Shares       Shares   Shares       Shares 
Share price                             75.7p     26.0p       75.0p        80.0p     41.0p       90.0p 
Share price total return                213.7p    83.0p       97.0p        212.6p    84.0p       97.5p 
 
                                                 Planned                            Planned 
                                       Ordinary   Exit    Infrastructure  Ordinary   Exit    Infrastructure 
                                         Shares  Shares       Shares       Shares   Shares       Shares 
 
Dividends paid*                         184.8p    57.0p       22.0p        182.1p    43.0p        7.5p 
Dividends paid in the year               7.0p     14.0p       14.5p         6.0p     22.5p        2.5p 
Dividend yield %                            9.2    53.8^            19.3       7.5    54.9^             2.8 
* From inception to 31 December 2016 
 ^In realisation mode. 
 
 
 
 
Ordinary Shares fund 
Share price discount to NAV at 31 December 2016                  9.4% 
Average discount on buybacks                                    10.4% 
Shares bought back during the year under review             1,322,684 
Increase in net asset value during year (after adding 
 back 7.0p dividend)                                             3.5% 
Ongoing charges ratio (based on net assets at 31 December 
 2016)                                                           2.1% 
Planned Exit Shares fund 
Share price premium to NAV at 31 December 2016                   0.4% 
Average discount on buybacks                                     8.5% 
Shares bought back during the year under review               122,773 
Increase in net asset value during year (after adding 
 back 14.0p dividend)                                            8.4% 
Ongoing charges ratio (based on net assets at 31 December 
 2016)                                                           1.9% 
Infrastructure Shares fund 
Share price discount to NAV at 31 December 2016                  8.2% 
Average discount on buybacks                                     0.7% 
Shares bought back during the year under review                14,978 
Increase in net asset value during year (after adding 
 back 14.5p dividend)                                            4.1% 
Ongoing charges ratio (based on net assets at 31 December 
 2016)                                                           1.7% 
 
   Strategies for achieving objectives 
 
   Investment Policy 
 
   The Company will target UK unquoted companies which it believes will 
achieve the objective of producing attractive returns for Shareholders. 
 
   Investment securities 
 
   The Company invests in a range of securities including, but not limited 
to, ordinary and preference shares, loan stock, convertible securities, 
fixed-interest securities and cash. Unquoted investments are usually 
structured as a combination of ordinary shares and loan stocks, while 
AiM investments are primarily held in ordinary shares. Pending 
investment in unquoted and AiM listed securities, cash is primarily held 
in interest bearing accounts as well as in a range of permitted 
liquidity investments. 
 
   UK companies 
 
   Investments are primarily made in companies which are substantially 
based in the UK, although many will trade overseas. The companies in 
which investments are made must satisfy a number of tests set out in 
Part 6 of the Income Tax Act 2007 to be classed as VCT qualifying 
holdings. 
 
   Asset mix 
 
   The Company aims to be significantly invested in growth businesses, 
subject always to the quality of investment opportunities and the timing 
of realisations. Any uninvested funds are held in cash and a range of 
permitted liquidity investments. It is intended that the significant 
majority (no less than 70%) of any funds raised by the Company will 
ultimately be invested in VCT qualifying investments. 
 
   Risk diversification and maximum exposures 
 
   Risk is spread by investing in a number of different businesses within 
different industry sectors at different stages of development, using a 
mixture of securities. The maximum amount invested in any one company 
including any guarantees to banks or third parties providing loans or 
other investment to such a company, is limited to 15% of the Company's 
investments by VCT value at the time of investment. 
 
   Investment style 
 
   Investments are selected in the expectation that value will be enhanced 
by the application of private equity disciplines, including an active 
management style for unquoted companies through the placement of an 
investor director on investee company boards. 
 
   Borrowing powers 
 
   The Company has a borrowing limit of an amount not exceeding an amount 
equal to the adjusted capital and reserves (being the aggregate of the 
amount paid up on the issued share capital of the Company and the amount 
standing to the credit of its reserves). Whilst the Company does not 
currently borrow, its policy allows it to do so. 
 
   Co-investment 
 
   The Company invests alongside other funds managed or advised by the 
Manager and Foresight Group. Where more than one fund is able to 
participate in an investment opportunity, allocations will generally be 
made in proportion to the net cash raised for each such fund, other than 
where a fund has a pre-existing investment where the incumbent fund will 
have priority. Implementation of this policy will be subject to the 
availability of monies to make the investment and other portfolio 
considerations, such as the portfolio diversity and the need to maintain 
VCT status. 
 
   VCT regulation 
 
   The investment policy is designed to ensure that the Company continues 
to qualify and is approved as a VCT by HM Revenue & Customs. Amongst 
other conditions, the Company may not invest more than 15% of its total 
investments at the time of making any investment in a single company and 
must have at least 70% by value of its investments throughout the period 
in shares or securities in qualifying holdings, of which 70% by value in 
aggregate must be in ordinary shares which carry no preferential rights 
(although only 10% of any individual investment needs to be in the 
ordinary shares of that Company). 
 
   Management 
 
   The Board has engaged Foresight Group CI Limited as manager. Foresight 
Fund Managers Limited also provides or procures the provision of company 
secretarial, administration and custodian services to the Company. The 
Manager prefers to take a lead role in the companies in which it 
invests. Larger investments may be syndicated with other investing 
institutions, or strategic partners with similar investment criteria. In 
considering a prospective investment in a company, particular regard 
will be paid to: 
 
   Ordinary Shares fund 
 
 
   -- Evidence of high-margin products or services capable of addressing 
      fast-growing markets; 
 
   -- The company's ability to sustain a competitive advantage; 
 
   -- The strength of the management team; 
 
   -- The existence of proprietary technology; 
 
   -- The company's prospects of being sold or achieving a flotation within 
      three to five years. 
 
   Planned Exit Shares fund 
 
   --  Security of income and capital; 
 
   --  Asset backing; 
 
   --  The company's ability to provide an attractive yield for the fund; 
 
   --  The prospects of achieving an exit within five years; 
 
   --  The strength of the management team. 
 
   Infrastructure Shares fund 
 
   --  Long-term contracts with Governmental or strong counter-parties; 
 
   --  Protection from competition; 
 
   --  Inflation-linked revenues over 10-50 year contract durations. 
 
   Environmental, Human Rights, Employee, Social and Community Issues 
 
   The Board recognises the requirement under Section 414 of the Act to 
provide information about environmental matters (including the impact of 
the Company's business on the environment), employee, human rights, 
social and community issues; including information about any policies it 
has in relation to these matters and effectiveness of these policies. As 
the Company has no employees or policies in these matters this 
requirement does not apply. 
 
   Gender diversity 
 
   The Board currently comprises four male Directors. The Board is, however, 
conscious of the need for diversity and will consider both male and 
female candidates when appointing new Directors. 
 
   The Manager has an equal opportunities policy and currently employs 86 
men and 59 women. 
 
   Dividend policy 
 
   A proportion of realised gains will normally be retained for 
reinvestment and to meet future costs. Subject to this, the Company will 
endeavour to maintain a flow of dividend payments of the order of 5p per 
share across all share classes, although a greater or lesser sum may be 
paid in any year. It is the intention to maximise the Company's tax-free 
income for investors from a combination of dividends and interest 
received on investments and the distribution of capital gains arising 
from trade sales or flotations. 
 
   Purchase of own shares 
 
   It is the Company's policy, subject to adequate cash availability, to 
consider repurchasing shares when they become available in order to help 
provide liquidity to the market in the Company's shares. 
 
   Principal risks, risk management and regulatory environment 
 
   The Board carries out regular reviews of the risk environment in which 
the Company operates. The principal risks and uncertainties identified 
by the Board which might affect the Company's business model and future 
performance, and the steps taken with a view to their mitigation, are as 
follows: 
 
   Economic risk: events such as economic recession or general fluctuation 
in stock markets and interest rates may affect the valuation of investee 
companies and their ability to access adequate financial resources, as 

well as affecting the Company's own share price and discount to net 
asset value. Mitigation: The Company invests in a diversified portfolio 
of investments spanning various industry sectors and maintains 
sufficient cash reserves to be able to provide additional funding to 
investee companies where appropriate and to repurchase its own shares. 
 
   VCT qualifying status risk: the Company is required at all times to 
observe the conditions laid down in the Income Tax Act 2007 for the 
maintenance of approved VCT status. The loss of such approval could lead 
to the Company losing its exemption from corporation tax on capital 
gains, to investors being liable to pay income tax on dividends received 
from the Company and, in certain circumstances, to investors being 
required to repay the initial income tax relief on their investment. 
Mitigation: Legal advice is taken for each deal to ensure all 
investments are qualifying. Advance assurance, where appropriate, is 
sought from HMRC ahead of completion. The Manager keeps the Company's 
VCT qualifying status under continual review, seeking to take 
appropriate action to maintain it where required, and its reports are 
reviewed by the Board on a quarterly basis. The Board has also retained 
Shakespeare Martineau LLP to undertake an independent VCT status 
monitoring role. 
 
   Investment and liquidity risk: many of the Company's investments are in 
small and medium-sized unquoted companies which are VCT qualifying 
holdings, and which by their nature entail a higher level of risk and 
lower liquidity than investments in larger quoted companies. Mitigation: 
the Manager aims to limit the risk attaching to the portfolio as a whole 
by careful selection, close monitoring and timely realisation of 
investments, by carrying out rigorous due diligence procedures and 
maintaining a spread of holdings in terms of industry sector. The Board 
reviews the investment portfolio with the Manager on a regular basis. 
 
   Legislative and regulatory risk: in order to maintain its approval as a 
VCT, the Company is required to comply with current VCT legislation in 
the UK, which reflects the European Commission's State aid rules. 
Changes to the UK legislation or the State aid rules in the future could 
have an adverse effect on the Company's ability to achieve satisfactory 
investment returns whilst retaining its VCT approval. Mitigation: The 
Board and the Manager monitor political developments and where 
appropriate seek to make representations either directly or through 
relevant trade bodies. 
 
   Internal control risk: the Company's assets could be at risk in the 
absence of an appropriate internal control regime. This could lead to 
theft, fraud, and/or an inability to provide accurate reporting and 
monitoring. Mitigation: the Board carries out regular reviews of the 
system of internal controls, both financial and non-financial, operated 
by the Company and the Manager. These include controls designed to 
ensure that the Company's assets are safeguarded and that proper 
accounting records are maintained. 
 
   Financial risk: inappropriate accounting policies might lead to 
misreporting or breaches of regulations. Mitigation: the Manager is 
continually reviewing accounting policies and regulations, and its 
reports are reviewed by the Board on a quarterly basis and at least 
annually by the auditor. 
 
   Market risk: All investments are impacted by market risk. Investments 
quoted on the London Stock Exchange or AIM will potentially be subject 
to more immediate market fluctuations and volatility upwards and 
downwards. External factors such as terrorist activity can negatively 
impact stock markets worldwide. In times of adverse sentiment there can 
be very little, if any, market demand for shares in smaller companies 
quoted on AIM. Mitigation: The Board keeps the portfolio under regular 
review. 
 
   Credit risk: the Company holds a number of financial instruments and 
cash deposits and is dependent on the counterparties discharging their 
commitment. Mitigation: the directors and Manager review the 
creditworthiness of the counterparties to these instruments and cash 
deposits and seek to ensure there is no undue concentration of credit 
risk with any one party. 
 
   Viability Statement 
 
   In accordance with principle 21 of the AIC Code of Corporate Governance 
published by the AIC in February 2015, the Directors have assessed the 
prospects of the Company over the three year period to 31 December 2019. 
This three year period is used by the Board during the strategic 
planning process and is considered reasonable for a business of its 
nature and size. 
 
   In making this statement, the Board carried out an assessment of the 
principal risks facing the Company, including those that might threaten 
its business model, future performance, solvency, or liquidity. 
 
   The Board also considered the ability of the Company to raise finance 
and deploy capital. This assessment took account of the availability and 
likely effectiveness of the mitigating actions that could be taken to 
avoid or reduce the impact of the underlying risks, including the 
Manager adapting its investment process to take account of the more 
restrictive VCT investment rules. 
 
   This review has considered the principal risks which were identified by 
the Board. The Board concentrated its efforts on the major factors that 
affect the economic, regulatory and political environment. 
 
   The Directors have also considered the Company's income and expenditure 
projections and underlying assumptions for the next three years and 
found these to be realistic and sensible. 
 
   Based on the Company's processes for monitoring cash flow, share price 
discount, ongoing review of the investment objective and policy, asset 
allocation, sector weightings and portfolio risk profile, the Board has 
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 years to 31 December 2019. 
 
   Performance-related incentives 
 
   Shareholders approved a co-investment scheme and performance incentive 
arrangements at a General Meeting held on 8 March 2017, effective from 
31 March 2017. Details can be found in note 15 of the Annual Report and 
Accounts. There were no such arrangements in place during 2016. 
 
   Valuation Policy 
 
   Investments held by the Company have been valued in accordance with the 
International Private Equity and Venture Capital Valuation ("IPEVCV") 
guidelines (December 2015) developed by the British Venture Capital 
Association and other organisations. Through these guidelines, 
investments are valued as defined at 'fair value'. Ordinarily, unquoted 
investments will be valued at cost for a limited period following the 
date of acquisition, being the most suitable approximation of fair value 
unless there is an impairment or significant accretion in value during 
the period. Quoted investments and investments traded on AiM and ISDX 
Growth Market (formerly PLUS) are valued at the bid price as at 31 
December 2016. The portfolio valuations are prepared by Foresight Group, 
reviewed and approved by the Board quarterly and subject to annual 
review by the auditors. 
 
   VCT Tax Benefit for Shareholders 
 
   To obtain VCT tax reliefs on subscriptions up to GBP200,000 per annum, a 
VCT investor must be a 'qualifying' individual over the age of 18 with 
UK taxable income. The tax reliefs for subscriptions since 6 April 2006 
are: 
 
   --   Income tax relief of 30% on subscription for new shares, which is 
forfeit by Shareholders if the shares are not held for more than five 
years; 
 
   --   VCT dividends (including capital distributions of realised gains on 
investments) are not subject to income tax in the hands of qualifying 
holders; 
 
   --   Capital gains on disposal of VCT shares are tax-free, whenever the 
disposal occurs. 
 
   Venture Capital Trust Status 
 
   Foresight VCT plc has been granted approval as a Venture Capital Trust 
(VCT) under S274-S280A of the Income Tax Act 2007 for the year ended 31 
December 2015. The next complete review will be carried out for the year 
ended 31 December 2016. It is intended that the business of the Company 
be carried on so as to maintain its VCT status. 
 
   The Directors and the Manager have managed, and continue to manage, the 
business in order to comply with the legislation applicable to VCTs. The 
Board has appointed Shakespeare Martineau LLP to monitor and provide 
continuing advice in respect of the Company's compliance with applicable 
VCT legislation and regulation. As at 31 December 2016 the Company had 
75.4% (by VCT valuation) of its funds in such VCT qualifying holdings. 
 
   Future Strategy 
 
   The Board and the Manager believe that the strategy of focusing on 
growth private equity investments is currently in the best interests of 
Ordinary Shareholders and the historical information reproduced in this 
report is evidence of positive recent performance in this area. It is 
intended that the Planned Exit and Infrastructure Shares funds will be 
closed and funds returned to Shareholders in the medium term. 
 
   The Company's performance relative to its peer group and benchmarks will 
depend on the Manager's ability to allocate the Company's assets 
effectively, make successful investments and manage its liquidity 
appropriately. 
 
   John Gregory 
 
   Director 
 
   24 April 2017 
 
   Statement of Directors' Responsibilities 
 
   Statement of Directors' Responsibilities in respect of the Annual Report 
and Financial Statements 
 
   The Directors are responsible for preparing the Annual Report and the 
financial statements in accordance with applicable law and regulations. 
 
   Company law requires the directors to prepare financial statements for 
each financial year. Under that law they have elected to prepare the 
financial statements in accordance with UK Accounting Standards and 
applicable law (UK Generally Accepted Accounting Practice) including FRS 

102, the Financial Reporting Standard applicable in the UK and Republic 
of Ireland. 
 
   Under company law the directors must not approve the financial 
statements unless they are satisfied they give a true and fair view of 
the state of affairs of the Company and of the profit or loss of the 
Company for that period. In preparing these financial statements, the 
directors are required to: 
 
 
   -- select suitable accounting policies and then apply them consistently; 
 
   -- make judgements and estimates that are reasonable and prudent; 
 
   -- state whether applicable UK Accounting Standards have been followed, 
      subject to any material departures disclosed and explained in the 
      financial statements; and 
 
   -- prepare the financial statements on the going concern basis unless it is 
      inappropriate to presume that the Company will continue in business. 
 
 
   The directors are responsible for keeping adequate accounting records 
that are sufficient to show and explain the company's transactions and 
disclose with reasonable accuracy at any time the financial position of 
the Company and enable them to ensure that the financial statements 
comply with the Companies Act 2006. They have general responsibility for 
taking such steps as are reasonably open to them to safeguard the assets 
of the Company and to prevent and detect fraud and other irregularities. 
 
   Under applicable law and regulations, the directors are also responsible 
for preparing the Strategic Report, Directors' Report, Directors' 
Remuneration Report and Corporate Governance Statement that complies 
with that law and those regulations. 
 
   The directors are responsible for the maintenance and integrity of the 
corporate and financial information included on the Company's website 
(which is delegated to Foresight Group and incorporated into their 
website). Legislation in the UK governing the preparation and 
dissemination of financial statements may differ from legislation in 
other jurisdictions. 
 
   Statement of Directors' in respect of the Annual Financial Report 
 
   We confirm that to the best of our knowledge: 
 
 
   -- the financial statements, prepared in accordance with the applicable 
      accounting standards, give a true and fair view of the assets, 
      liabilities, financial position and profit or loss of the Company; and 
 
   -- the Directors' Report and Strategic Report include a fair review of the 
      development and performance of the business and the position of the 
      Company, together with a description of the principal risks and 
      uncertainties that the Company faces. 
 
 
   We consider the annual report and accounts, taken as a whole, are fair, 
balanced, and understandable and provide the necessary information for 
Shareholders to assess the Company's position and performance, business 
model and strategy. 
 
   On behalf of the Board 
 
   John Gregory 
 
   Chairman 
 
   24 April 2017 
 
   Unaudited Non-Statutory Analysis of the Share Classes 
 
   Income Statements 
 
   for the year ended 31 December 2016 
 
 
 
 
                Ordinary Shares Fund     Planned Exit Shares Fund   Infrastructure Shares Fund 
              Revenue  Capital   Total   Revenue  Capital   Total   Revenue  Capital   Total 
              GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
Realised 
 losses on 
 investments        -  (2,651)  (2,651)        -     (51)     (51)        -    (560)     (560) 
Investment 
 holding 
 gains              -    6,851    6,851        -      408      408        -    1,020     1,020 
Income          1,412        -    1,412       68        -       68    1,436        -     1,436 
Investment 
 management 
 fees           (451)  (1,351)  (1,802)      (9)     (27)     (36)     (74)    (223)     (297) 
Other 
 expenses       (436)        -    (436)     (19)        -     (19)    (141)        -     (141) 
Return on 
 ordinary 
 activities 
 before 
 taxation         525    2,849    3,374       40      330      370    1,221      237     1,458 
Taxation        (102)      170       68      (8)        5      (3)    (110)       45      (65) 
Return on 
 ordinary 
 activities 
 after 
 taxation         423    3,019    3,442       32      335      367    1,111      282     1,393 
Return per       0.4p     2.8p     3.2p     0.3p     2.9p     3.2p     3.4p     0.9p      4.3p 
 share 
 
   Balance Sheets 
 
   at 31 December 2016 
 
 
 
 
                                      Ordinary    Planned Exit  Infrastructure 
                                     Shares Fund   Shares Fund    Shares Fund 
                                      GBP'000       GBP'000        GBP'000 
Fixed assets 
Investments held at fair value 
 through profit or loss                   66,151         2,541          23,525 
 
Current assets 
Debtors                                    1,733           283             229 
Money market securities and other 
 deposits                                 30,901            75               - 
Cash                                       8,454            60           2,847 
                                          41,088           418           3,076 
Creditors 
Amounts falling due within one 
 year                                      (193)          (10)            (41) 
Net current assets                        40,895           408           3,035 
Net assets                               107,046         2,949          26,560 
 
Capital and reserves 
Called-up share capital                    1,280           114             324 
Share premium account                     96,071         2,095          14,375 
Capital redemption reserve                   431             3               1 
Distributable reserve                      5,247         1,705          11,591 
Capital reserve                          (3,770)         (362)         (1,116) 
Revaluation reserve                        7,787         (606)           1,385 
Equity Shareholders' funds               107,046         2,949          26,560 
Number of shares in issue            127,985,288    11,404,314      32,495,246 
Net asset value per share                  83.6p         25.9p           81.7p 
 
 
   At 31 December 2016 there was an inter-share debtor/creditor of 
GBP52,000 which has been eliminated on aggregation. 
 
   Reconciliations of Movements in Shareholders' Funds 
 
   for the year ended 31 December 2016 
 
 
 
 
                         Called-up                          Capital 
                           share                           redemption  Distributable 
                          capital   Share premium account   reserve       reserve     Capital reserve  Revaluation reserve   Total 
  Ordinary Shares Fund    GBP'000          GBP'000          GBP'000       GBP'000         GBP'000            GBP'000         GBP'000 
As at 1 January 2016           866                 60,383         418         13,133               62                  936    75,798 
Share issues in the 
 year                          427                 37,312           -              -                -                    -    37,739 
Expenses in relation to 
 share issues*                   -                (1,624)           -              -                -                    -   (1,624) 
Repurchase of shares          (13)                      -          13          (939)                -                    -     (939) 
Realised losses on 
 disposal of 
 investments                     -                      -           -              -          (2,651)                    -   (2,651) 
Investment holding 
 gains                           -                      -           -              -                -                6,851     6,851 
Dividends                        -                      -           -        (7,370)                -                    -   (7,370) 
Management fees charged 
 to capital                      -                      -           -              -          (1,351)                    -   (1,351) 
Tax credited to capital          -                      -           -              -              170                    -       170 
Revenue return for the 
 year                            -                      -           -            423                -                    -       423 
As at 31 December 2016       1,280                 96,071         431          5,247          (3,770)                7,787   107,046 
 
 
   *Expenses in relation to share issues include adviser fees (GBP820,000) 
and promoters fees (GBP755,000) for the 2016 fund raise and trail 
commission in relation to prior year fund raises (GBP49,000). 
 
 
 
 
                 Called-up                            Capital 
                     share                         redemption  Distributable 
Planned Exit       capital  Share premium account     reserve        reserve  Capital reserve  Revaluation reserve   Total 
Shares Fund        GBP'000                GBP'000     GBP'000        GBP'000          GBP'000              GBP'000   GBP'000 
As at 1 January 
 2016                  115                  2,118           2          3,316            (289)              (1,014)     4,248 
Trail 
 commission in 
 relation to 
 prior year 
 share issues            -                   (23)           -              -                -                    -      (23) 
Repurchase of 
 shares                (1)                      -           1           (39)                -                    -      (39) 
Realised losses 
 on disposal of 
 investments             -                      -           -              -             (51)                    -      (51) 
Investment 
 holding gains           -                      -           -              -                -                  408       408 
Dividends                -                      -           -        (1,604)                -                      - (1,604) 
Management fees 
 charged to 
 capital                 -                      -           -              -             (27)                    -      (27) 
Tax credited to 

 capital                 -                      -           -              -                5                    -         5 
Revenue return 
 for the year            -                      -           -             32                -                    -        32 
As at 31 
 December 2016         114                  2,095           3          1,705            (362)                (606)     2,949 
                 Called-up                  Share     Capital 
                     share                premium  redemption  Distributable          Capital          Revaluation 
                   capital                account     reserve        reserve          reserve              reserve     Total 
Infrastructure 
Shares Fund        GBP'000                GBP'000     GBP'000        GBP'000          GBP'000                GBP'000 GBP'000 
As at 1 January 
 2016                  324                 14,515           1         15,205            (378)                     365 30,032 
Trail 
 commission in 
 relation to 
 prior year 
 share issues            -                  (140)           -              -                -                        - (140) 
Repurchase of 
 shares                  -                      -           -           (13)                -                         - (13) 
Realised losses 
 on disposal of 
 investments             -                      -           -              -            (560)                        - (560) 
Investment 
 holding gains           -                      -           -              -                -                    1,020 1,020 
Dividends                -                      -           -        (4,712)                -                      - (4,712) 
Management fees 
 charged to 
 capital                 -                      -           -              -            (223)                        - (223) 
Tax credited to 
 capital                 -                      -           -              -               45                           - 45 
Revenue return 
 for the year            -                      -           -          1,111                -                        - 1,111 
As at 31 
 December 2016         324                 14,375           1         11,591          (1,116)                   1,385 26,560 
 
 
 
 
 
   Audited Income Statement 
 
   for the year ended 31 December 2016 
 
 
 
 
                                                                 Year ended 
                                                               31 December 2015 
                                  Year ended                   Revenue Capital 
                                31 December 2016               GBP'000 GBP'000 
                               Revenue   Capital    Total                          Total 
                               GBP'000    GBP'000   GBP'000                        GBP'000 
Realised losses on 
 investments                          -   (3,262)   (3,262)        -     (8,649)   (8,649) 
Investment holding gains              -     8,279     8,279        -       5,183     5,183 
Income                            2,916         -     2,916    1,561           -     1,561 
Investment management fees        (534)   (1,601)   (2,135)    (319)       (958)   (1,277) 
Other expenses                    (596)         -     (596)    (616)           -     (616) 
Return/(loss) on ordinary 
 activities before taxation       1,786     3,416     5,202      626     (4,424)   (3,798) 
Taxation                          (220)       220         -     (52)          52         - 
Return/(loss) on ordinary 
 activities after taxation        1,566     3,636     5,202      574     (4,372)   (3,798) 
Return/(loss) per share: 
Ordinary Share                     0.4p      2.8p      3.2p     0.7p      (7.4)p    (6.7)p 
Planned Exit Share                 0.3p      2.9p      3.2p   (3.1)p      (4.4)p    (7.5)p 
Infrastructure Share               3.4p      0.9p      4.3p     2.2p        0.7p      2.9p 
 
 
   The total column of this statement is the profit and loss account of the 
Company and the revenue and capital columns represent supplementary 
information. 
 
   All revenue and capital items in the above Income Statement are derived 
from continuing operations. No operations were acquired or discontinued 
in the year. 
 
   The Company has no recognised gains or losses other than those shown 
above, therefore no separate statement of total recognised gains and 
losses has been presented. 
 
 
 
   Audited Reconciliation of Movements in Shareholders' Funds 
 
 
 
 
 
 
                                                        Capital 
Year ended         Called-up                         redemption  Distributable 
31 December    share capital  Share premium account     reserve        reserve  Capital reserve  Revaluation reserve     Total 
2016                 GBP'000  GBP'000                   GBP'000        GBP'000  GBP'000          GBP'000               GBP'000 
As at 1 
 January 
 2016                  1,305                 77,016         421         31,654            (605)                  287   110,078 
Share issues 
 in the 
 year                    427                 37,312           -              -                -                    -    37,739 
Expenses in 
 relation to 
 share 
 issues                    -                (1,787)           -              -                -                    -   (1,787) 
Repurchase 
 of shares              (14)                      -          14          (991)                -                    -     (991) 
Realised 
 losses on 
 disposal of 
 investments               -                      -           -              -          (3,262)                    -   (3,262) 
Investment 
 holding 
 gains                     -                      -           -              -                -                8,279     8,279 
Dividends                  -                      -           -       (13,686)                -                    -  (13,686) 
Management 
 fees 
 charged to 
 capital                   -                      -           -              -          (1,601)                    -   (1,601) 
Tax credited 
 to capital                -                      -           -              -              220                    -       220 
Revenue 
 return for 
 the year                  -                      -           -          1,566                -                    -     1,566 
As at 31 
 December 
 2016                  1,718                112,541         435         18,543          (5,248)                8,566   136,555 
                   Called-up                  Share     Capital 
                       share                premium  redemption  Distributable          Capital          Revaluation 
                     capital                account     reserve        reserve          reserve              reserve     Total 
Year ended 
31 December 
2015                 GBP'000                GBP'000     GBP'000        GBP'000          GBP'000              GBP'000   GBP'000 
As at 1 
 January 
 2015                    671                 21,032         403         37,295            8,950              (4,896)    63,455 
Share issues 
 in the 
 year                    652                 56,674           -              -                -                    -    57,326 
Expenses in 
 relation to 
 share 
 issues                    -                  (690)           -              -                -                    -     (690) 
Repurchase 
 of shares              (18)                      -          18        (1,418)                -                    -   (1,418) 
Net realised 
 losses on 
 disposal of 
 investments               -                      -           -              -          (8,649)                    -   (8,649) 
Investment 
 holding 
 gains                     -                      -           -              -                -                5,183     5,183 
Dividends                  -                      -           -        (4,797)                -                    -   (4,797) 
Management 
 fees 
 charged to 
 capital                   -                      -           -              -            (958)                    -     (958) 
Tax credited 
 to capital                -                      -           -              -               52                    -        52 
Revenue 
 return for 
 the year                  -                      -           -            574                -                    -       574 
As at 31 
 December 
 2015                  1,305                 77,016         421         31,654            (605)                  287   110,078 
 
 
 
   Audited Balance Sheet 
 
   at 31 December 2016 
 
 
 
 
 Registered Number: 03421340 
  As at As at 
  31 December 31 December 
  2016 2015 
  GBP'000 GBP'000 
Fixed assets 
Investments held at fair value through profit or loss    92,217   92,237 
Current assets 
Debtors                                                   2,193    1,416 
Money market securities and other deposits               30,976   14,888 
Cash                                                     11,361    2,881 
                                                         44,530   19,185 
Creditors 
Amounts falling due within one year                       (192)  (1,344) 
Net current assets                                       44,338   17,841 
Net assets                                              136,555  110,078 
Capital and reserves 
Called-up share capital                                   1,718    1,305 
Share premium account                                   112,541   77,016 
Capital redemption reserve                                  435      421 
Distributable reserve                                    18,543   31,654 
Capital reserve                                         (5,248)    (605) 
Revaluation reserve                                       8,566      287 
Equity Shareholders' funds                              136,555  110,078 
Net asset value per share: 
Ordinary Share                                            83.6p    87.5p 

Planned Exit Share                                        25.9p    36.8p 
Infrastructure Share                                      81.7p    92.4p 
 
 
   The financial statements on pages 45 to 67 of the Annual Report and 
Accounts were approved by the Board of Directors and authorised for 
issue on 24 April 2017 and were signed on its behalf by: 
 
   John Gregory 
 
   Director 
 
 
 
   Audited Cash Flow Statement 
 
   for the year ended 31 December 2016 
 
 
 
 
                                                                Year Year 
                                                              ended ended 
                                                  31 December 31 December 
                                                                2016 2015 
                                                          GBP'000 GBP'000 
Cash flow from operating activities 
Investment income received                                2,768     1,762 
Deposit and similar interest received                        98        71 
Investment management fees paid                         (2,118)   (1,277) 
Secretarial fees paid                                     (110)     (100) 
Other cash payments                                       (848)     (340) 
Net cash (outflow)/inflow from operating activities       (210)       116 
Returns on investing activities 
Purchase of unquoted investments                        (4,877)  (16,028) 
Net proceeds on sale of investments                       9,287     4,415 
Net proceeds on deferred consideration                       64       725 
(Return)/receipt of cash held on behalf of investee 
 companies                                                (548)       213 
Net cash inflow/(outflow) from investing activities       3,926  (10,675) 
Financing 
Proceeds of fund raising                                 36,028    18,936 
Expenses of fund raising                                  (886)     (517) 
Repurchase of own shares                                (1,329)   (1,068) 
Equity dividends paid                                  (12,961)   (4,690) 
Movement in money market funds                         (16,088)   (7,732) 
Cash acquired on merger with Foresight 2 VCT plc              -     1,159 
Net cash inflow from financing activities                 4,764     6,088 
Net inflow/(outflow) of cash in the year                  8,480   (4,471) 
Reconciliation of net cash flow to movement in net 
 funds 
Increase/(decrease) in cash and cash equivalents for 
 the year                                                 8,480   (4,471) 
Net cash and cash equivalents at start of year            2,881     7,352 
Net cash and cash equivalents at end of year             11,361     2,881 
 
 
   Analysis of changes in net debt 
 
 
 
 
                            At 1 January 2016  Cashflow  At 31 December 2016 
                                 GBP'000       GBP'000         GBP'000 
Cash and cash equivalents               2,881     8,480               11,361 
 
 
 
 
 
   Notes 
 
   1. The audited Annual Financial Report has been prepared on the basis of 
accounting policies set out in the statutory accounts of the Company for 
the year ended 31 December 2016. All investments held by the Company are 
classified as 'fair value through the profit and loss'. Unquoted 
investments have been valued in accordance with IPEVC guidelines. Quoted 
investments are stated at bid prices in accordance with the IPEVC 
guidelines and Generally Accepted Accounting Practice. 
 
   2. These are not statutory accounts in accordance with S436 of the 
Companies Act 2006. The full audited accounts for the year ended 31 
December 2016, which were unqualified and did not contain statements 
under S498(2) of the Companies Act 2006 or S498(3) of the Companies Act 
2006, will be lodged with the Registrar of Companies. Statutory accounts 
for the year ended 31 December 2016 including an unqualified audit 
report and containing no statements under the Companies Act 2006 will be 
delivered to the Registrar of Companies in due course. 
 
 
 
 
 
   3. Copies of the Annual Report will be sent to shareholders and will be 
available for inspection at the Registered Office of the Company at The 
Shard, 32 London Bridge Street, London, SE1 9SG and can be accessed on 
the following website: www.foresightgroup.eu. 
 
 
 
 
 
   4. 
   Net asset value per share 
 
 
 
   The net asset value per share is based on net assets at the end of the 
period and on the number of shares in issue at that date. 
 
 
 
 
                 31 December 2016                                   31 December 2015 
 Ordinary                       Planned  Infrastructure       Ordinary       Planned  Infrastructure 
   Shares                   Exit Shares      Shares             Shares   Exit Shares          Shares 
     Fund                          Fund       Fund                Fund          Fund            Fund 
Net 
assets     GBP107,046,000  GBP2,949,000  GBP26,560,000   GBP75,798,000  GBP4,248,000   GBP30,032,000 
No. of 
 shares 
 at year 
 end          127,985,288    11,404,314      32,495,246     86,593,790    11,527,087      32,510,224 
Net asset           83.6p         25.9p           81.7p          87.5p         36.8p           92.4p 
 value 
 per 
 share 
 
 
 
 
   5.    Return per share 
 
 
 
 
                                                          Year ended 31 December 2016              Year ended 31 December 2015 
                                                                                                           Planned 
                                                     Ordinary      Planned    Infrastructure   Ordinary     Exit     Infrastructure 
                                                       Share      Exit Share      Share         Share       Share        Share 
                                                      GBP'000      GBP'000       GBP'000       GBP'000     GBP'000      GBP'000 
Total return after taxation                               3,442          367           1,393     (3,823)      (472)             497 
Total return per share (note a)                            3.2p         3.2p            4.3p      (6.7)p     (7.5)p            2.9p 
Revenue return from ordinary activities after 
 taxation                                                   423           32           1,111         391      (197)             380 
Revenue return per share (note b)                          0.4p         0.3p            3.4p        0.7p     (3.1)p            2.2p 
Capital return from ordinary shares after taxation        3,019          335             282     (4,214)      (275)             117 
Capital return per share (note c)                          2.8p         2.9p            0.9p      (7.4)p     (4.4)p            0.7p 
Weighted average number of shares in issue in the 
 year                                               109,561,757   11,488,663      32,502,653  56,855,338  6,256,492      17,169,610 
 
   Notes: 
 
   a) Total return per share is total return after taxation divided by the 
weighted average number of shares in issue during the year. 
 
   b) Revenue return per share is revenue return after taxation divided by 
the weighted average number of shares in issue during the year. 
 
   c) Capital return per share is capital return after taxation divided by 
the weighted average number of shares in issue during the year. 
 
 
 
 
 
   6.    Annual General Meeting 
 
   The Annual General Meeting will be held at 10.00am on 23 May 2017 at the 
offices of Foresight Group LLP, The Shard, 32 London Bridge Street, 
London, SE1 9SG. 
 
 
 
   7.    Income 
 
 
 
 
 
                                                  Year ended Year ended 
                                                31 December 31 December 
                                                              2016 2015 
                                                        GBP'000 GBP'000 
Loan stock interest                                        2,133  1,435 
Dividends                                                    685     55 
Overseas based Open Ended Investment Companies ("OEICs")      98     71 
                                                           2,916  1,561 
 
 
   8.    Investments 
 
 
 
 
                          2016      2015 
Company                  GBP'000   GBP'000 
Quoted investments            54        47 
Unquoted investments      92,163    92,190 
                          92,217    92,237 
 
 
 
 
                                 Quoted   Unquoted   Total 
Company                          GBP'000  GBP'000   GBP'000 
Book cost as at 1 January 2016        44    92,105   92,149 
Investment holding gains               3        85       88 
Valuation at 1 January 2016           47    92,190   92,237 
Movements in the year: 
Purchases at cost                      -     4,877    4,877 
Disposal proceeds                    (5)   (9,282)  (9,287) 
Realised gains/(losses)*               1   (3,327)  (3,326) 
Investment holding gains**            11     7,705    7,716 
Valuation at 31 December 2016         54    92,163   92,217 
Book cost at 31 December 2016         40    84,373   84,413 
Investment holding gains              14     7,790    7,804 
Valuation at 31 December 2016         54    92,163   92,217 
                                  Quoted  Unquoted    Total 
Ordinary Shares Fund             GBP'000   GBP'000  GBP'000 
Book cost as at 1 January 2016        44    57,331   57,375 
Investment holding gains               3       734      737 
Valuation at 1 January 2016           47    58,065   58,112 
Movements in the year: 
Purchases at cost                      -     4,877    4,877 
Disposal proceeds                    (5)     (668)    (673) 
Realised gains/(losses)*               1   (2,703)  (2,702) 
Investment holding gains**            11     6,526    6,537 
Valuation at 31 December 2016         54    66,097   66,151 
Book cost at 31 December 2016         40    58,837   58,877 
Investment holding gains              14     7,260    7,274 
Valuation at 31 December 2016         54    66,097   66,151 
 
 

   *Deferred consideration of GBP51,000 was received by the Ordinary Shares 
fund in the year and is included within realised losses in the income 
statement. This was offset by a decrease in the deferred consideration 
debtor of GBP50,000. 
 
   ** Deferred consideration of GBP364,000 was recognised in the year and 
is included in investment holding gains in the income statement. 
 
 
 
 
                             Quoted  Unquoted   Total 
   Planned Exit Shares Fund GBP'000   GBP'000   GBP'000 
   Book cost as at 1 January 2016 -     4,836     4,836 
        Investment holding losses -   (1,014)   (1,014) 
      Valuation at 1 January 2016 -     3,822     3,822 
Movements in the year: 
                Disposal proceeds -   (1,376)   (1,376) 
                 Realised losses* -      (64)      (64) 
       Investment holding gains** -       159       159 
    Valuation at 31 December 2016 -     2,541     2,541 
    Book cost at 31 December 2016 -     3,396     3,396 
        Investment holding losses -     (855)     (855) 
    Valuation at 31 December 2016 -     2,541     2,541 
 
 
   * Deferred consideration of GBP13,000 was received by the Planned Exit 
Shares fund in the year and is included within realised losses in the 
income statement. 
 
   ** A deferred consideration debtor of GBP249,000 was recognised in the 
year and is included in investment holding gains in the income 
statement. 
 
 
 
 
                               Quoted  Unquoted   Total 
   Infrastructure Shares Fund GBP'000   GBP'000   GBP'000 
     Book cost as at 1 January 2016 -    29,938    29,938 
           Investment holding gains -       365       365 
        Valuation at 1 January 2016 -    30,303    30,303 
Movements in the year: 
                  Disposal proceeds -   (7,238)   (7,238) 
                    Realised losses -     (560)     (560) 
           Investment holding gains -     1,020     1,020 
      Valuation at 31 December 2016 -    23,525    23,525 
      Book cost at 31 December 2016 -    22,140    22,140 
           Investment holding gains -     1,385     1,385 
      Valuation at 31 December 2016 -    23,525    23,525 
 
 
   9.    Related party transactions 
 
   No Director has an interest in any contract to which the Company is a 
party. 
 
   10.    Transactions with the manager 
 
   Foresight Group CI Limited, which acts as manager to the Company in 
respect of all its investments, earned fees of GBP2,135,000 during the 
year (2015: GBP1,227,000). Foresight Fund Managers Limited, Company 
Secretary, received fees excluding VAT of GBP110,000 (2015: GBP100,000) 
during the year. 
 
   At the balance sheet date, there was GBP17,000 (2015: GBPnil) due to 
Foresight Group CI Limited and GBPnil (2015: GBPnil) due to Foresight 
Fund Managers Limited. No amounts have been written off in the year in 
respect of debts due to or from the related parties. 
 
   END 
 
   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: Foresight VCT PLC via Globenewswire 
 
 
  http://www.foresightgroup.eu/ 
 

(END) Dow Jones Newswires

April 24, 2017 12:22 ET (16:22 GMT)

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