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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Mobeus Income & Growth 2 Vct Plc | LSE:MIG | London | Ordinary Share | GB00B0LKLZ05 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 59.00 | 57.50 | 60.50 | 59.00 | 59.00 | 59.00 | 57 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Trust,ex Ed,religious,charty | -7.57M | -9.64M | -0.0987 | -5.98 | 57.62M |
From Apr 2019 to Apr 2024
TIDMMIG
RNS Number : 8552P
Mobeus Income & Growth 2 VCT PLC
22 November 2016
Mobeus Income & Growth 2 VCT plc
Half-Year Report for the six months ended 30 September 2016
Mobeus Income & Growth 2 VCT plc ("MIG2", the "Company", "VCT" or the "Fund") is a Venture Capital Trust ("VCT") advised by Mobeus Equity Partners LLP ("Mobeus"), investing primarily in established, unquoted companies.
Company Objective
The Objective of the Company is to provide investors with a regular income stream, arising both from the income generated by companies selected for the portfolio and from realising any growth in capital, while continuing at all times to qualify as a VCT.
Financial Highlights
Results for the six months ended 30 September 2016
-- There was a marginal increase in Net Asset Value ("NAV") per share, after adjusting for dividends paid, whilst there was an increase of 2.9% on a share price basis, for the Half-Year.
-- Shareholders received a special interim dividend of 5.00 pence per share for the current year, which was paid on 8 August 2016.
-- GBP0.37 million was invested in the period into MPB Group and GBP0.40 million into BookingTek after the period-end.
-- Liquidity is GBP18.20 million.
Performance Summary
The net asset value per share of the Company at 30 September 2016 was 114.64 pence.
Cumulative total shareholder return per share (NAV basis)*:
The longer term trend of performance on this measure is shown in the chart below:-
Hot Features
Premium
Period Net asset value (NAV) per Cumulative dividends paid Cumulative total shareholder
share per share return per share
(NAV basis)
(p) (p) (p)
As at 30 September 2016 114.64 52.00 166.64
As at 31 March 2016 119.61 47.00 166.61
As at 31 March 2015 115.45 42.00 157.45
As at 31 March 2014 120.73 23.00 143.73
As at 30 April 2013 106.75 18.00 124.75
As at 30 April 2012 98.71 14.00 112.71
As at 30 April 2011 96.16 10.00 106.16
As at 30 April 2010 87.47 5.00 92.47
As at 30 April 2009 86.02 4.00 90.02
As at 30 April 2008 98.48 1.50 99.98
As at 30 April 2007 97.15 1.50 98.65
*Cumulative NAV total shareholder return is net asset value plus cumulative dividends paid to date on the current share class, launched in 2005.
Note: The above data does not reflect the benefit of income tax relief upon initial subscription for the Company's shares.
Chairman's Statement
I am pleased to present the Half-Year Report for Mobeus Income & Growth 2 VCT plc for the six months ended 30 September 2016.
Overview
The result of the EU Referendum has triggered a period of UK economic uncertainty and volatility in financial markets. We are taking a measured approach to prospective investment opportunities and to valuations within the existing portfolio. This half-year has been a period of consolidation as the Investment Adviser develops and evaluates a pipeline of opportunities that comply with the Company's new Investment Policy ("the Policy").
By way of reminder, shareholders approved a revised Investment Policy at the Company's AGM on 15 September 2016. This policy was required to enable the Company to continue to comply with changes to the VCT Scheme introduced by the Finance (No 2) Act 2015, enacted last November ("the New VCT Rules"). In summary, the Company may now only make new VCT investments in younger and smaller companies for growth and development purposes. Further information was given in the 2016 Annual Report and an update on this matter is also provided in the section on "VCT legalisation".
As a consequence of the more restrictive criteria in the New VCT Rules, a lower level of investment activity has occurred, a trend experienced across the whole of the VCT generalist sector. This has slowed down the rate of completed investment. In the period, the Company's new investment amounted to GBP0.37 million, which compared to GBP1.83 million for the same period last year.
Nevertheless, the Board is pleased to report that the Company has recently completed three new investments under the Company's new Investment Policy. The Investment Adviser has enlarged its team and it is reporting the development of a strong pipeline of similar investment opportunities. Descriptions of two of the investments made are set out in the Investment Review.
Performance for the six months ended 30 September 2016
The net asset value (NAV) per share increased marginally during the period from 119.61 pence per share at 31 March 2016 to 119.64 pence per share, after adjusting for a 5.00 pence dividend paid in August 2016.
As noted in my Statement in the Annual Report, the Board has previously set a minimum average return target for the Company of 8%. Given the regulatory changes and subsequent adoption of a new Investment Policy, this target level may no longer be appropriate. As a result, the Board is considering a new return target to take account of these changed circumstances.
Investment portfolio
The investment portfolio recorded a small loss of GBP0.12 million during the first half of the year (a 0.4% fall from the 31 March 2016 value) and was valued at GBP29.53 million (including GBP6.74 million of companies preparing to trade ("CPTs")) at the period-end. The portfolio as a whole, which principally comprises MBO investments made prior to the change in the VCT Rules in November of last year, has continued to perform acceptably. Redline Worldwide ("Redline") and Access IS, two recent additions to the portfolio, both made strong starts.
In June, a new investment of GBP0.37 million was made into MPB Group Limited ("MPB"), a leading online marketplace for used photo and video equipment. After the period-end, in October, the Company invested GBP0.40 million in BookingTek Limited, a provider of enterprise software to major hotel groups.
Following an exceptional period of realisations in 2014 and 2015, the Company has not exited any investments during this period, although a total of GBP0.06 million of capital proceeds have been received.
Further details of all these transactions can be found in the Investment Review section of this Half-Year Report.
Interim dividend
The Board's objective is, subject to the availability of sufficient reserves and liquidity, to distribute regular and consistent dividends. The Board's target is currently 5.00 pence per annum. The Board declared a special interim dividend of 5.00 pence per share for the year ending 31 March 2017, which was paid on 8 August 2016. This dividend was paid as a special interim dividend and has helped the VCT comply with the requirements of VCT legislation. It was not regarded by the Board as fulfilling the annual 5.00 pence dividend target. The Board intends to consider whether any further dividends are to be paid before the year-end, later in the financial year.
Liquidity
Liquidity of GBP18.20 million (31 March 2016: GBP20.44 million) (44.3% of net assets (31 March 2016: 47.4%)) includes GBP6.74 million (31 March 2016: GBP6.74 million) invested in CPTs . The percentage liquidity figure of 44.3% of net assets has reduced from the level at 31 March 2016 of 47.4% partly due to the special 5.00 pence per share dividend paid in August 2016. Whilst the current level of liquidity is higher than the Board would ideally like, the Board and the Investment Adviser believe the rate of new investment should now increase. In the meantime, the Board are continuing to seek suitable investment opportunities for these funds, without compromising the overriding requirement that credit risk to the liquid assets portfolio is minimised.
Share buybacks
During the six months ended 30 September 2016, the Company bought back 0.24 million of its own shares, representing 0.7% of the issued share capital at the beginning of the period, at an average price, including costs, of 104.03 pence per share.
The Board continues to believe that the current policy of maintaining the share price at an average discount of 10% to the prevailing NAV is appropriate in current market conditions.
All of the shares bought back in the period were subsequently cancelled by the Company. Continuing shareholders benefit from the difference between NAV per share and the price per share at which the shares are bought back and cancelled.
Fundraising
Having considered the liquidity above, the Board has concluded that there is no need to raise further funds in the current tax year.
VCT legislation
Details of the New VCT Rules and their potential impact on the Company and its returns were set out in the 2016 Annual Report and a summary of current VCT regulation for the Company set out further down.
Your Board, together with the Investment Adviser and the whole VCT industry, has sought greater clarity from HMRC at a more detailed, practical level of what investments will or will not be permitted by the legislation. The draft guidance, published by HMRC in May, has now clarified some (but not all) of the implications of these New VCT Rules. The Investment Adviser, together with the Company's VCT Status Adviser, is seeking further clarification of aspects of this guidance. Further practical experience in applying these New VCT Rules to particular transactions is needed.
Despite Brexit, the Board has a working assumption that any changes to the existing legislation will not occur in the near future. Industry bodies are still continuing discussions with HMRC and HM Treasury to try to secure an amendment to the VCT Rules to permit VCTs to provide some replacement capital as part of an investment. If obtained, this would enlarge the pool of possible investment opportunities for VCTs compared to the more restricted regime that now applies under the New VCT Rules.
The Board's view remains that the changes in VCT legislation restrict the universe of companies that the Company can invest in. These changes may cause new investments to carry a higher risk, but could also hold the prospect of higher but more variable returns. The VCT's recent investments into Redline, MPB and BookingTek are examples of the type of investment the Company is likely to make in the future.
Investment in qualifying holdings
The Company is required to meet the target set by HMRC of investing 70% of the funds raised in qualifying unquoted and/or AIM quoted companies. The Company exceeded this limit (based on VCT cost as defined in tax legislation which differs from the actual cost given in the Investment Portfolio Summary) throughout the period. The balance of the portfolio was invested in non-qualifying investments and cash.
Succession Planning
At the AGM on 15 September 2016, all Directors stood for re-election, having served for nine or more years. Succession planning was put on hold recently whilst the implications of the regulatory changes had been assessed and addressed. Following the implementation of the new Investment Policy, this matter is being addressed.
Shareholder Communications
The Investment Adviser holds an annual VCT event for shareholders in central London. Each event includes a presentation on the Mobeus VCTs' investment activity and performance. The next event will be held on Tuesday, 24 January 2017 once again at the Royal Institute of British Architects in central London. There will be a daytime and a separate evening session. Shareholders have already been sent an invitation to this event with further details. If you have not replied to the invitation, but would like to attend, please apply to Mobeus by email (vcts@mobeusequity.co.uk) to register. The Board looks forward to meeting all shareholders able to attend.
Audit regulation
In compliance with EU Audit Reform and rules on audit tendering and Mandatory Firm Rotation, which came into effect on 17 June 2016, the Company conducted an audit tender process during the period. Following the completion of the audit tender process the Board has decided to re-appoint BDO LLP as Auditor to the Company.
Outlook
The outcomes of the UK's EU Referendum and the recent US election have created a higher level of global political and economic uncertainty. This uncertainty is likely to prevail for some time, but both the Board and Investment Adviser remain positive around future prospects for the Company.
Finally, I would like to take this opportunity to thank shareholders for their continued support.
Nigel Melville
Chairman
22 November 2016
Investment Policy
The investment policy is designed to meet the Company's objective.
Investments
The Company invests primarily in a diverse portfolio of UK unquoted companies. Investments are made selectively across a number of sectors, principally in established companies. Investments are usually structured as part loan stock and part equity in order to produce a regular income stream and to generate capital gains from realisations.
There are a number of conditions within the VCT legislation which need to be met by the Company and which may change from time to time. The Company will seek to make investments in accordance with the requirements of prevailing VCT legislation.
Asset allocation and risk diversification policies, including the size and type of investments the Company makes, are determined in part by the requirements of prevailing VCT legislation. No single investment may represent more than 15% (by VCT tax value) of the Company's total investments at the date of investment.
Liquidity
The Company's cash and liquid funds are held in a portfolio of readily realisable interest bearing investments, deposit and current accounts, of varying maturities, subject to the overriding criterion that the risk of loss of capital be minimised.
Borrowing
The Company's articles of association permit borrowings of amounts up to 10% of the adjusted capital and reserves (as defined therein). However, the Company has never borrowed and the Board would only consider doing so in exceptional circumstances.
Summary of VCT Regulation
To assist shareholders, the following table contains a summary of the most important rules that determine VCT approval.
To achieve continued status as a VCT, the Company must meet a number of conditions, the most
important of which are that:-
* The Company must hold at least 70%, by VCT tax value*,
of its total investments (shares, securities and
liquidity) in VCT qualifying holdings, within
approximately three years of a fundraising;
* Of these qualifying holdings, an overall minimum of
30% by VCT tax value* (70% for funds raised on or
after 6 April 2011) must be in ordinary shares which
carry no preferential rights (save as may be
permitted under VCT rules);
* No investment in a single company or group of
companies may represent more than 15% (by VCT tax
value*) of the Company's total investments at the
date of investment;
* The Company must pay sufficient levels of income
dividend from its revenue available for distribution
so as not to retain more than 15% of its income from
shares and securities in a year;
* The Company's shares must be listed on a regulated
European stock market; and
* Non-qualifying investments can no longer be made,
except for certain exemptions in managing the
Company's short-term liquidity.
To be a VCT qualifying holding, a new investment must be in companies:-
* which carry on a qualifying trade;
* which have no more than GBP15 million of gross assets
at the time of investment and GBP16 million
immediately following investment from VCTs;
* whose maximum age is generally seven years (ten years
for knowledge intensive businesses);
* that receive no more than an annual limit of GBP5
million and a lifetime limit of GBP12 million (GBP20
million for knowledge intensive companies), from VCTs
and similar sources of State Aid funding;
* that use the funds received from VCTs for growth and
development purposes.
* VCT tax value means as valued in accordance with prevailing VCT legislation.
The above takes into account legislation up to the Finance Act 2016 enacted in September 2016
but effective from 6 April 2016.
Investment Review
Overview
Portfolio activity over these six months has been at a lower level than in recent years. In respect of new investment, this is due to the impact of the introduction of the Finance (No 2) Act in November 2015.
These amendments to VCT legislation were a significant change for the VCT industry and required all VCTs to reconsider the type of investments that VCTs can make in future. We have responded to this by adding experienced development capital investment resource to our existing team. Advance assurance is obtained from HMRC in respect of new investment proposals.
These factors have inevitably caused a reduction in the rate and level of new investment. Despite these uncertainties, we are pleased to report that three new investments have now been completed under these new rules, one of which relates to the period under review, and the pipeline of prospective opportunities is increasing. We intend that the pace and quantum of investment will increase in the second half of the year.
After an unprecedented number of profitable realisations in 2014 and 2015, we do not anticipate this will be repeated in the near to medium term. The average age of the portfolio has reduced and the focus will generally be on the expansion opportunities our management teams are pursuing, although our recent experience shows that our portfolio companies are often attractive targets for both mid-market private equity houses and acquisitive corporates. In the meantime, the companies held in the existing portfolio continue to generate a solid income stream for the VCT, principally from attractive yields from the loan stock investments held.
The valuation of the portfolio has fallen slightly by 0.4% on a like for like basis. The six month period experienced notable increases in the valuations of RDL and Vian Marketing (Tushingham Sails) whilst the portfolio also saw valuation declines over the period, principally in the investments in Entanet and ASL. The underlying performance of the investment portfolio continues to be driven by the investments made prior to the introduction of the new rules, and we remain confident of its potential for continued growth in value for shareholders. Redline and MPB, the first two investments made in accordance with the new rules, have made strong starts.
Impact of Brexit
It is too early to comment on the eventual impact of the UK leaving the EU upon the Company's business. Whilst the SME sector will not be immune to any general downturn in the UK economy, the portfolio has historically proved to be resilient and we believe will continue to be so. Portfolio companies with foreign currency exposure routinely cover this exposure and any negative effects of a longer term adjustment in exchange rate will not emerge for some months. Some portfolio companies will be beneficiaries of a weaker pound.
New investment
A total of GBP0.37 million was invested during the six months under review. This was a new investment in MPB, a UK based online marketplace for used photo and video equipment. After the period end in October, GBP0.40 million was invested into BookingTek Limited, a provider of room booking software to major hotel groups.
Realisations in the half-year
There have been no full realisations in the period, although the Company received cash proceeds of GBP0.06 million, GBP0.04 million of which was from a loan stock repayment by Jablite Holdings Limited. This company has now returned around 92% of the original investment made in April 2015 by the Company. GBP0.02 million was also received as an interim distribution resulting from the members' voluntary liquidation of Newquay Helicopters (2013) Limited, bringing total proceeds to date from this investment to 175% of original cost.
Mobeus Equity Partners LLP
Investment Adviser
22 November 2016
New investment in the half-year
Company Business Date of investment Amount of new investment (GBPm)
------------ ------------------------------------------- ------------------- -------------------------------
Online marketplace for used photo and video
MPB Group equipment June 2016 0.37
MPB is Europe's leading online marketplace for used photo and video equipment. Based in Brighton,
its custom-designed pricing technology enables MPB to offer both buy and sell services through
the same platform and offers a one-stop shop for all its customers. The investment is to fund
expansion of its platform globally, with launches into both the US and German markets. The
company's latest audited accounts for the year ended 31 March 2015 show turnover of GBP7.49
million and profit before interest, tax and amortisation of goodwill of GBP0.30 million.
New investment post period-end
Company Business Date of investment Amount of new investment (GBPm)
----------- ------------------------------------------- ------------------- -------------------------------
BookingTek Online booking software for hotels October 2016 0.40
----------- ------------------------------------------- ------------------- -------------------------------
Based in London, BookingTek has developed software that enables hotels to reduce their reliance
on third-party booking systems through a real-time booking platform for meeting rooms and
restaurant reservations. The investment is to support further growth. The company's latest
audited accounts for the year ended 31 July 2015 show turnover of GBP2.19 million and loss
before interest, tax and amortisation of goodwill of GBP0.33 million.
---------------------------------------------------------------------------------------------------------------
Investment Portfolio Summary
as at 30 September 2016
Qualifying investments Date of first Total Book Valuation Additions Disposals Change in Valuation % of net
investment / Sector cost at 30 at 31 at cost at valuation at 30 assets
September March 2016 valuation for September by
2016 period 2016 value
GBP GBP GBP GBP GBP GBP
Unquoted investments
ASL Technology Holdings
Limited
Printer and photocopier December 2010
services Support services 2,092,009 2,397,086 - - (190,768) 2,206,318 5.4%
Tovey Management Limited
(trading as Access IS)
Provider of data October 2015
capture and scanning Software and
hardware Computer Services 1,733,500 1,733,500 - - 129,048 1,862,548 4.5%
Virgin Wines Holding
Company Limited November 2013
Online wine retailer General retailers 1,284,333 1,886,136 - - (152,241) 1,733,895 4.2%
Manufacturing Services
Investment Limited
Company seeking to
carry on a business in
the manufacturing February 2014
sector Support services 1,608,300 1,608,300 - - - 1,608,300 3.9%
Entanet Holdings Limited
Wholesale voice and February 2014
data communications Fixed Line
provider Telecommunications 1,444,090 2,045,102 - - (520,731) 1,524,371 3.7%
------------------------ ------------------- ---------- ---------- --------- --------- --------- ---------- --------
Fullfield Limited
(trading as Motorclean)
Vehicle cleaning and July 2011
valet services Support services 1,025,152 1,281,548 - - 83,152 1,364,700 3.3%
RDL Corporation Limited
Recruitment consultants
for the pharmaceutical,
business intelligence October 2010
and IT industries Support services 1,000,000 669,057 - - 308,845 977,902 2.4%
Veritek Global Holdings
Limited
Maintenance of imaging July 2013
equipment Support services 967,780 974,052 - - (2,998) 971,054 2.4%
Tharstern Group Limited
Software based July 2014
management information Software and
systems Computer Services 789,815 977,681 - - (12,092) 965,589 2.4%
------------------------ ------------------- ---------- ---------- --------- --------- --------- ---------- --------
Turner Topco Limited
(trading as ATG Media)
Publisher and online
auction platform October 2008
operator Media 1,320,963 798,686 - - 163,972 962,658 2.3%
Vian Marketing Limited
(trading as Tushingham
Sails)
Design, manufacture and
sale of stand-up
paddleboards and July 2015
windsurfing sails Leisure goods 717,038 717,038 - - 229,028 946,066 2.3%
CGI Creative Graphics
International Limited
Vinyl graphics to
global automotive, June 2014
recreation vehicle and General
aerospace markets Industrials 999,568 889,634 - - 19,675 909,309 2.2%
Hollydale Management
Limited
Company seeking to
carry on a business in March 2015
the food sector Support services 885,000 885,000 - - - 885,000 2.2%
EOTH Limited
(trading as Rab and
Lowe Alpine)
Branded outdoor October 2011
equipment and clothing General retailers 817,185 842,686 - - 40,657 883,343 2.2%
Media Business Insight
Holdings Limited
A publishing and events
business focused on the
creative production January 2015
industries Media 1,447,188 910,360 - - (38,415) 871,945 2.1%
Backhouse Management
Limited
Company seeking to
carry on a business in April 2015
the motor sector Support services 848,500 848,500 - - - 848,500 2.1%
Barham Consulting
Limited
Company seeking to
carry on a business in April 2015
the catering sector Support services 848,500 848,500 - - - 848,500 2.1%
Chatfield Services
Limited
Company seeking to
carry on a business in April 2015
the retail sector Support services 848,500 848,500 - - - 848,500 2.1%
Creasy Marketing
Services Limited
Company seeking to
carry on a business in April 2015
the textile sector Support services 848,500 848,500 - - - 848,500 2.1%
McGrigor Management
Limited
Company seeking to
carry on a business in
the pharmaceutical April 2015
sector Support services 848,500 848,500 - - - 848,500 2.1%
The Plastic Surgeon
Holdings Limited
Snagging and finishing
of domestic and April 2008
commercial properties Support services 392,348 767,053 - - 40,724 807,777 2.0%
Gro-Group Holdings
Limited March 2013
Baby sleep products General retailers 1,123,088 751,930 - - 21,392 773,322 1.9%
Jablite Holdings Limited
(formerly Duncary 16
Limited) April 2015
Expanded polystyrene Construction and
products materials 281,398 788,021 - 42,425 (28,517) 717,079 1.7%
Redline Worldwide
Limited
(formerly Pound FM
Consultants Limited)
Provider of security
services to the
aviation industry and February 2016
other sectors Support services 682,222 682,222 - - - 682,222 1.7%
Blaze Signs Holdings
Limited
Manufacturing and April 2006
installation of signs Support services 437,030 738,939 - - (86,752) 652,187 1.6%
January 2014
Bourn Bioscience Limited Healthcare
Management of In-vitro Equipment &
fertilisation clinics Services 757,101 626,517 - - (59,274) 567,243 1.4%
Leap New Co Limited
(trading as Ward Thomas
Removals, Bishopsgate
and Aussie Man & Van)
A specialist logistics,
storage and removals December 2014
business Support services 369,625 534,927 - (58,668) 476,259 1.2%
MPB Group Limited
Online marketplace for
used photographic June 2016
equipment General retailers 374,244 - 374,244 - - 374,244 0.9%
Vectair Holdings Limited
Designer and
distributor of washroom January 2006
products Support services 60,293 271,156 - - 70,214 341,370 0.8%
Racoon International
Holdings Limited
Supplier of hair
extensions, hair care December 2006
products and training Personal goods 1,045,985 167,458 - - - 167,458 0.4%
Lightworks Software
Limited April 2006
Provider of software Software and
for CAD and CAM vendors Computer Services 25,727 65,592 - - 11,334 76,926 0.1%
Newquay Helicopters
(2013) Limited (in
members' voluntary
liquidation)
Helicopter service June 2006
operator Support services 49,368 66,169 - 16,801 (49,368) - 0.0%
Preservica Limited December 2015
Proprietary digital Software and
archiving software Computer Services - - - - - - 0.0%
Total unquoted investments 27,972,850 28,318,350 374,244 59,226 (81,783) 28,551,585 69.7%
AIM quoted investments
365 Agile Group
(formerly lafyds plc) March 2001
Development of energy Electronic and
saving devices for electrical
domestic use equipment 254,586 8 - - (6) 2 0.0%
Total AIM quoted investments 254,586 8 - - (6) 2 0.0%
Total qualifying investments 28,227,436 28,318,358 374,244 59,226 (81,789) 28,551,587 69.7%(1)
Non-qualifying
investments
Media Business Insight
Limited as above 561,884 794,824 - - (33,540) 761,284 1.9%
Tovey Management Limited
(trading as Access IS) as above 219,873 219,873 - - - 219,873 0.5%
------------------------ ------------------- ---------- ---------- --------- --------- --------- ---------- --------
Total non-qualifying investments 781,757 1,014,697 - - (33,540) 981,157 2.4%
Total investments per note 9 29,009,193 29,333,055 374,244 59,226 (115,329) 29,532,744 72.1%
Cash and current asset investments(2) - 13,702,539 - - - 11,466,174 27.9%
Total investments including cash and current
asset investments 29,009,193 43,035,594 374,244 59,226 (115,329) 40,998,918 100.0%
Debtors - 266,308 - - - 171,789 0.3%
Creditors - (160,890) - - - (100,084) (0.3)%
Net assets at the period-end 43,141,012 41,070,623 100.0%
--------------------------------------------- ---------- ---------- --------- --------- --------- ---------- --------
(1) As at 30 September 2016, the Company held more than 70% of its total investments in qualifying holdings, and therefore complied with the VCT Qualifying Investment test. For the purposes of the VCT qualifying test, the Company is permitted to disregard disposals of investments for six months from the date of disposal. It also has up to three years, before new funds raised need to be included in the qualifying investment test.
(2) Disclosed as Current asset investments and Cash at bank within Current assets in the Balance Sheet.
Statements of the Directors in respect of the Half-Year Report
Responsibility Statement
In accordance with Disclosure and Transparency Rule (DTR) 4.2.10, the condensed set of financial statements, which has been prepared in accordance with Financial Reporting Standard 104 "Interim Financial Reporting" gives a true and fair view of the assets, liabilities, financial position and loss of the Company, as required by DTR 4.2.10. Nigel Melville (Chairman and Chairman of the Nominations Committee), Adam Kingdon (Chairman of the Audit Committee), Sally Duckworth (Chairman of the Investment Committee) and Kenneth Vere Nicoll (Chairman of the Remuneration Committee), being the Directors of the Company, confirm that to the best of their knowledge:
(a) the half-year management report which comprises the Chairman's Statement, Investment Policy, Investment Review and the Investment Portfolio Summary includes a fair review of the information required by DTR 4.2.7, being an indication of the important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements;
(b) a description of the principal risks and uncertainties facing the Company for the remaining six months is set out below, in accordance with DTR 4.2.7; and
(c) there were no related party transactions in the first six months of the current financial year that are required to be disclosed, in accordance with DTR 4.2.8.
Principal Risks and Uncertainties
The Board acknowledges that there is regulatory risk and continues to manage the Company's affairs in such a manner as to comply with section 274 of the Income Tax Act 2007. The level of regulatory uncertainty has increased following the publication of the Finance (No 2) Act 2015 in November 2015 which amended the VCT Scheme in the UK.
In accordance with DTR 4.2.7, the Board confirms that the principal risks and uncertainties facing the Company have not changed materially from those identified in the Annual Report and Accounts for the year ended 31 March 2016.
The principal risks faced by the Company are:
-- economic; -- investment and strategic; -- loss of approval as a VCT; -- VCT regulatory changes; -- regulatory; -- financial and operating; -- market; -- asset liquidity; -- market liquidity; and -- counterparty.
A more detailed explanation of these risks can be found in the Strategic Report on pages 22 and 23 and in Note 15 on pages 58 - 65 of the Annual Report and Accounts for the year ended 31 March 2016, copies of which are available on the Investment Adviser's website, www.mobeusequity.co.uk or by going directly to the VCT's website, www.mig2vct.co.uk.
Going Concern
The Board has assessed the Company's operation as a going concern. The Company's business activities, together with the factors likely to affect its future development, performance and position are set out in the half-year management report which comprises the Chairman's Statement, Investment Policy, Investment Review and Investment Portfolio Summary. The Directors have satisfied themselves that the Company continues to maintain a significant cash position. The majority of companies in the portfolio continue to trade profitably and the portfolio taken as a whole remains resilient and well-diversified. The major cash outflows of the Company (namely investments, buybacks and dividends) are within the Company's control.
The Board's assessment of liquidity risk and details of the Company's policies for managing its capital and financial risks are shown in Note 15 on pages 58 - 65 of the Annual Report and Accounts for the year ended 31 March 2016. Accordingly, the Directors continue to adopt the going concern basis of accounting in preparing the half-year report and annual financial statements.
Cautionary Statement
This report may contain forward looking statements with regards to the financial condition and results of the Company, which are made in the light of current economic and business circumstances. Nothing in this report should be construed as a profit forecast.
For and on behalf of the Board
Nigel Melville
Chairman
22 November 2016
Unaudited Condensed Income Statement
for the six months ended 30 September 2016
Six months ended 30 September 2016 Year ended 31 March 2016 Six months ended 30 September 2015
(unaudited) (audited) (unaudited)
Notes Revenue Capital Total Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP GBP GBP GBP
--------------- ----- ---------- ---------- -------------- --------- --------- --------- ------------ ----------- -----------
Unrealised
(losses)/gains
on investments
held at fair
value 9 - (115,329) (115,329) - 1,089,897 1,089,897 - 1,726,253 1,726,253
Realised gains
on investments
held at fair
value 9 - - - - 1,732,241 1,732,241 - 239,026 239,026
Income 4 752,727 - 752,727 1,736,490 - 1,736,490 837,064 - 837,064
Investment
Adviser's fees 5 (121,482) (364,445) (485,927) (246,651) (739,953) (986,604) (121,374) (364,123) (485,497)
Other expenses (168,991) - (168,991) (302,518) - (302,518) (176,032) - (176,032)
--------------- ----- ---------- ---------- -------------- --------- --------- --------- ------------ ----------- -----------
Profit/(loss)
on ordinary
activities
before
taxation 462,254 (479,774) (17,520) 1,187,321 2,082,185 3,269,506 539,658 1,601,156 2,140,814
Tax on
profit/(loss)
on ordinary
activities 6 (72,889) 72,889 - (147,991) 147,991 - ( 72,825) 72,825 -
--------------- ----- ---------- ---------- -------------- --------- --------- --------- ------------ ----------- -----------
Profit/(loss)
and total
comprehensive
income 389,365 (406,885) (17,520) 1,039,330 2,230,176 3,269,506 466,833 1,673,981 2,140,814
--------------- ----- ---------- ---------- -------------- --------- --------- --------- ------------ ----------- -----------
Basic and
diluted
earnings per
share
Ordinary Shares 7 1.08p (1.13)p (0.05)p 2.86p 6.14p 9.00p 1.28p 4.60p 5.88p
--------------- ----- ---------- ---------- -------------- --------- --------- --------- ------------ ----------- -----------
The revenue column of the Income Statement includes all income and expenses. The capital column accounts for the unrealised (losses)/gains and realised gains on investments and the proportion of the Investment Adviser's fee charged to capital.
The total column is the Statement of Total Comprehensive Income of the Company prepared in accordance with UK GAAP Financial Reporting Standard 102. In order to better reflect the activities of a VCT and in accordance with the Statement of Recommended Practice ("SORP") issued in November 2014 by the Association of Investment Companies ("AIC"), supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented alongside the Income Statement. The revenue column of profit attributable to equity shareholders is the measure the Directors believe appropriate in assessing the Company's compliance with certain requirements set out in Section 274 Income Tax Act 2007.
All the items in the above statement derive from continuing operations of the Company. No operations were acquired or discontinued in the period/year.
Unaudited Condensed Balance Sheet
as at 30 September 2016
30 September 2016 31 March 2016 30 September 2015
(unaudited) (audited) (unaudited)
Notes GBP GBP GBP
Fixed assets
Investments at fair value 9 29,532,744 29,333,055 31,875,061
Current assets
Debtors and prepayments 171,789 266,308 183,820
Current asset investments 10 6,934,362 9,337,621 6,727,300
Cash at bank and in hand 10 4,531,812 4,364,918 5,367,178
----------------------------------------------- ----- ----------------- ------------- -----------------
11,637,963 13,968,847 12,278,298
Creditors: amounts falling due within one year (100,084) (160,890) (172,578)
----------------------------------------------- ----- ----------------- ------------- -----------------
Net current assets 11,537,879 13,807,957 12,105,720
----------------------------------------------- ----- ----------------- ------------- -----------------
Net assets 41,070,623 43,141,012 43,980,781
----------------------------------------------- ----- ----------------- ------------- -----------------
Capital and reserves
Called up share capital 358,248 360,685 362,185
Share premium reserve 15,901,497 15,901,497 15,901,497
Capital redemption reserve 86,059 83,622 82,122
Revaluation reserve 1,656,663 1,783,724 2,842,900
Special distributable reserve 7,979,631 8,524,729 8,982,930
Realised capital reserve 13,741,824 15,529,419 14,518,846
Revenue reserve 1,346,701 957,336 1,290,301
----------------------------------------------- ----- ----------------- ------------- -----------------
Equity shareholders' funds 41,070,623 43,141,012 43,980,781
----------------------------------------------- ----- ----------------- ------------- -----------------
Basic and diluted net asset value per share 11 114.64p 119.61p 121.43p
----------------------------------------------- ----- ----------------- ------------- -----------------
Unaudited Condensed Statement of Changes in Equity
for the six months ended 30 September 2016
Non-distributable reserves Distributable reserves
Called Share Capital Revaluation Special Realised Revenue Total
up
share premium redemption reserve distributable capital reserve
capital reserve reserve reserve reserve
(note (note (note
a) b) b)
GBP GBP GBP GBP GBP GBP GBP GBP
-------------------- ------- ---------- ---------- ----------- ------------- ----------- --------- -----------
At 1 April
2016 360,685 15,901,497 83,622 1,783,724 8,524,729 15,529,419 957,336 43,141,012
Comprehensive
income
for the
period
(Loss)/profit
for the
period - - - (115,329) - (291,556) 389,365 (17,520)
-------------------- ------- ---------- ---------- ----------- ------------- ----------- --------- -----------
Total comprehensive
income
for the
period - - - (115,329) - (291,556) 389,365 (17,520)
Contributions
by and
distributions
to owners
Shares
bought
back (note
c) (2,437) - 2,437 - (253,542) - - (253,542)
Dividends
paid - - - - - (1,799,327) - (1,799,327)
-------------------- ------- ---------- ---------- ----------- ------------- ----------- --------- -----------
Total contributions
by and
distributions
to owners (2,437) - 2,437 - (253,542) (1,799,327) - (2,052,869)
Other movements
Realised
losses
transferred
to special
reserve
(note a) - - - - (291,556) 291,556 - -
Realisation
of previously
unrealised
appreciation - - - (11,732) - 11,732 - -
-------------------- ------- ---------- ---------- ----------- ------------- ----------- --------- -----------
Total other
movements - - - (11,732) (291,556) 303,288 - -
-------------------- ------- ---------- ---------- ----------- ------------- ----------- --------- -----------
At 30 September
2016 358,248 15,901,497 86,059 1,656,663 7,979,631 13,741,824 1,346,701 41,070,623
Notes
a): The Special distributable reserve provides the Company with a reserve to fund market purchases of the Company's own shares, to absorb any existing or future losses and for any other corporate purpose.
b): The Realised capital reserve and the Revenue reserve together comprise the Profit and Loss Account of the Company.
c): During the Half-Year, the Company purchased 243,719 of its own shares at the prevailing market price for a total cost of GBP253,542, which were subsequently cancelled.
Unaudited Condensed Statement of Changes in Equity
for the six months ended 30 September 2015
Non-distributable reserves Distributable reserves
Called Share Capital Revaluation Special Realised Revenue Total
up
share premium redemption reserve distributable capital reserve
capital reserve reserve reserve reserve
GBP GBP GBP GBP GBP GBP GBP GBP
---------------------- ------- ---------- ---------- ----------- ------------- ---------- --------- ----------
At 1 April
2015 364,686 15,901,497 79,621 1,116,647 9,537,078 14,279,820 823,468 42,102,817
Comprehensive
income
for the period
Profit for
the period - - - 1,726,253 - (52,272) 466,833 2,140,814
---------------------- ------- ---------- ---------- ----------- ------------- ---------- --------- ----------
Total comprehensive
income for
the period - - - 1,726,253 - (52,272) 466,833 2,140,814
---------------------- ------- ---------- ---------- ----------- ------------- ---------- --------- ----------
Contributions
by and
distributions
to owners
Shares bought
back (2,501) - 2,501 - (262,850) - - (262,850)
Dividends - - - - - - - -
paid
---------------------- ------- ---------- ---------- ----------- ------------- ---------- --------- ----------
Total contributions
by and distributions
to owners (2,501) - 2,501 - (262,850) - - (262,850)
---------------------- ------- ---------- ---------- ----------- ------------- ---------- --------- ----------
Other movements
Realised losses
transferred
to special
reserve - - - - (291,298) 291,298 - -
Realisation - - - - - - - -
of previously
unrealised
appreciation
---------------------- ------- ---------- ---------- ----------- ------------- ---------- --------- ----------
Total other
movements - - - - (291,298) 291,298 - -
At 30 September
2015 362,185 15,901,497 82,122 2,842,900 8,982,930 14,518,846 1,290,301 43,980,781
---------------------- ------- ---------- ---------- ----------- ------------- ---------- --------- ----------
Unaudited Condensed Statement of Cash Flows
for the six months ended 30 September 2016
Six months ended Year ended Six months ended
30 September 2016 31 March 2016 30 September 2015
(unaudited) (audited) (unaudited)
Notes GBP GBP GBP
------------------------------------------------------- ----- ------------------ -------------- ------------------
Cash flows from operating activities
(Loss)/profit for the financial period (17,520) 3,269,506 2,140,814
Adjustments for:
Unrealised losses/(gains) on investments 115,329 (1,089,897) (1,726,253)
Realised gains on investments - (1,732,241) (239,026)
Decrease/(increase) in debtors 94,519 (86,327) (3,839)
(Decrease)/increase in creditors and accruals (60,850) (47,047) 8,097
------------------------------------------------------- ----- ------------------ -------------- ------------------
Net cash inflow from operations 131,478 313,994 179,793
------------------------------------------------------- ----- ------------------ -------------- ------------------
Cash flows from investing activities
Purchase of investments 9 (374,244) (9,164,569) (8,896,851)
Disposal of investments 9 59,226 5,001,367 1,334,784
No change/(increase) in bank deposits with a maturity
over three months - (7,061) -
------------------------------------------------------- ----- ------------------ -------------- ------------------
Net cash outflow from investing activities (315,018) (4,170,263) (7,562,067)
------------------------------------------------------- ----- ------------------ -------------- ------------------
Cash flows from financing activities
Shares issued as part of Offer for subscription - - -
Equity dividends paid 8 (1,799,327) (1,810,924) -
Purchase of own shares (253,498) (376,756) (262,675)
------------------------------------------------------- ----- ------------------ -------------- ------------------
Net cash outflow from financing activities (2,052,825) (2,187,680) (262,675)
------------------------------------------------------- ----- ------------------ -------------- ------------------
Net decrease in cash and cash equivalents (2,236,365) (6,043,949) (7,644,949)
Cash and cash equivalents at start of period 13,195,478 19,239,427 19,239,427
------------------------------------------------------- ----- ------------------ -------------- ------------------
Cash and cash equivalents at end of period 10,959,113 13,195,478 11,594,478
------------------------------------------------------- ----- ------------------ -------------- ------------------
Cash and cash equivalents comprise:
Cash at bank and in hand 10 4,531,812 4,364,918 5,367,178
Cash equivalents 10 6,427,301 8,830,560 6,227,300
Notes to the Unaudited Condensed Financial Statements
for the six months ended 30 September 2016
1. Company information
Mobeus Income and Growth 2 VCT plc is a public limited company incorporated in England, registration number 03946235. The registered office is 30 Haymarket, London, SW1Y 4EX.
2. Basis of preparation
These financial statements are prepared in accordance with accounting policies consistent with Financial Reporting Standard 102 ("FRS102"), Financial Reporting Standard 104 ("FRS104") - Interim Financial Reporting, with the Companies Act 2006 and the 2014 Statement of Recommended practice, 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' ('the SORP') issued by the Association of Investment Companies ("AIC").
The Company has elected to apply early the revised disclosure requirements as set out in Amendments to FRS102 - Fair Value hierarchy disclosures, issued in March 2016.
The Half-Year Report has not been audited, nor has it been reviewed by the auditor pursuant to the Financial Reporting Council's (FRC) guidance on Review of Interim Financial Information.
Comparatives
The comparatives to these Unaudited Condensed Financial Statements are those disclosed in each prior period/year's financial statements other than in relation to Monies held pending investment, Current asset investments and Cash at bank. These comparative figures have been reallocated to reflect more accurately the nature of the underlying instruments. This is just a presentational change and has had no effect on net assets.
3. Principal accounting policies
The accounting policies have been applied consistently throughout the period. Full details of principal accounting policies will be disclosed in the Annual Report, while the policy in respect of investments is included at the top of note 9 on investments.
4. Income
Six months Year ended Six months
ended ended
30 September 31 March 30 September
2016 2016 2015
(unaudited) (audited) (unaudited)
Income from investments GBP GBP GBP
------------------------ ------------- ----------- -------------
Dividends 51,144 87,073 62,764
Money-market
funds 14,127 21,406 8,490
Loan stock interest 666,444 1,578,774 741,030
Bank deposit
interest 21,012 49,237 24,780
Total Income 752,727 1,736,490 837,064
------------------------ ------------- ----------- -------------
5. Investment Adviser's fees
Under the terms of a revised investment management agreement dated 15 November 2016, Mobeus provides investment advisory, administrative and company secretarial services to the Company, for a fee of 2.0% per annum calculated on a quarterly basis by reference to the net assets at the end of the preceding quarter, plus a fee of GBP113,589 per annum, the latter being subject to changes in the retail prices index each year. In 2013, Mobeus agreed to waive such further increases due to indexation, until otherwise agreed by the Board. In accordance with the policy statement published under "Management and Administration" in the Company's prospectus dated 10 May 2000, the Directors have charged 75% of the investment adviser expenses to the capital account. This is in line with the Board's expectation of the long-term split of returns from the investment portfolio of the Company.
6. Taxation
There is no tax charge for the period as the Company has tax losses brought forward from previous years.
7. Basic and diluted earnings per share
Six months Year ended Six months
ended ended
30 September 31 March 30 September
2016 2015
(unaudited) 2016 (unaudited)
(audited)
GBP GBP GBP
--------------------------------------------------------- -------------- ----------- --------------
Total earnings after taxation (17,520) 3,269,506 2,140,814
Basic and diluted earnings per share (note a) (0.05)p 9.00p 5.88p
Net revenue from ordinary activities after taxation 389,365 1,039,330 466,833
Basic and diluted revenue earnings per share (note b) 1.08p 2.86p 1.28p
Net unrealised capital (losses)/gains (115,329) 1,089,897 1,726,253
Net realised capital gains - 1,732,241 239,026
Capital expenses (net of taxation) (291,556) (591,962) (291,298)
--------------------------------------------------------- -------------- ----------- --------------
Total capital return (406,885) 2,230,176 1,673,981
Basic and diluted capital earnings per share (note c) (1.13)p 6.14p 4.60p
--------------------------------------------------------- -------------- ----------- --------------
Weighted average number of shares in issue in the period 36,025,948 36,312,815 36,408,806
Notes
a) Basic and diluted earnings per share is total earnings after taxation divided by the weighted average number of shares in issue.
b) Basic and diluted revenue earnings per share is revenue earnings after taxation divided by the weighted average number of shares in issue.
c) Basic and diluted capital earnings per share is total capital earnings divided by the weighted average number of shares in issue.
8. Dividends paid
Dividend Type For Pence Date Paid Six months Year ended Six months
year per share ended 30 ended 30
ended September September
2016 2015 (unaudited)
31 (unaudited) 31 March GBP
March 2016
GBP (audited)
GBP
--------- -------- -------- ---------- ---------- ------------ ---------- -----------------
Interim Income 2016 2.50p 18/03/2016 - 905,462 -
Interim Capital 2016 2.50p 18/03/2016 - 905,462 -
Special
Interim Capital 2017 5.00p 08/08/2016 1,799,327 - -
--------- -------- -------- ---------- ---------- ------------ ---------- -----------------
1,799,327 1,810,924 -
--------------------------- ---------- ---------- ------------ ---------- -----------------
9. Investments at fair value
All investments held by the Company are classified as "fair value through profit and loss", and valued in accordance with the International Private Equity and Venture Capital Valuation ("IPEVCV") guidelines, as updated in December 2015. This classification is followed as the Company's business is to invest in financial assets with a view to profiting from their total return in the form of capital growth and income.
For investments actively traded in organised financial markets, fair value is generally determined by reference to Stock Exchange market quoted bid prices at the close of business on the balance sheet date. Purchases and sales of quoted investments are recognised on the trade date where a contract of sale exists whose terms require delivery within a time frame determined by the relevant market. Purchases and sales of unlisted investments are recognised when the contract for acquisition or sale becomes unconditional.
Unquoted investments are stated at fair value by the Directors in accordance with the following rules, which are consistent with the IPEVCV guidelines:
All investments are held at the price of a recent investment for an appropriate period where there is considered to have been no change in fair value. Where such a basis is no longer considered appropriate, the following factors will be considered:
(i) Where a value is indicated by a material arms-length transaction by an independent third party in the shares of a company, this value will be used.
(ii) In the absence of i), and depending upon both the subsequent trading performance and investment structure of an investee company, the valuation basis will usually move to either:-
a) an earnings multiple basis. The shares may be valued by applying a suitable price-earnings ratio to that company's historic, current or forecast post-tax earnings before interest and amortisation (the ratio used being based on a comparable sector but the resulting value being adjusted to reflect points of difference identified by the Investment Adviser compared to the sector including, inter alia, a lack of marketability).
or:-
b) where a company's underperformance against plan indicates a diminution in the value of the investment, provision against cost is made, as appropriate. Where the value of an investment has fallen permanently below cost, the loss is treated as a permanent impairment and as a realised loss, even though the investment is still held. The Board assesses the portfolio for such investments and, after agreement with the Investment Adviser, will agree the values that represent the extent to which an investment has become realised. This is based upon an assessment of objective evidence of that investment's future prospects, to determine whether there is potential for the investment to recover in value.
(iii) Premiums that will be received upon repayment of loan stock investments are accrued at fair value when the Company receives the right to the premium and when considered recoverable.
(iv) Where an earnings multiple or cost less impairment basis is not appropriate and overriding factors apply, discounted cash flow or net asset valuation bases may be applied.
Capital gains and losses on investments, whether realised or unrealised, are dealt with in the profit and loss and revaluation reserves and movements in the period are shown in the Income Statement.
All investments are initially recognised and subsequently measured at fair value. Changes in fair value are recognised in the Income Statement.
The methods of fair value measurement are classified into hierarchy based on the reliability of the information used to determine the valuation.
- Level 1 - Fair value is measured based on quoted prices in an active market.
- Level 2 - Fair value is measured based on directly observable current market prices or indirectly being derived from market prices.
- Level 3 - Fair value is measured using valuation techniques using inputs that are not based on observable market data.
Summary of movement on investments at fair value
Traded Unquoted Unquoted Unquoted Total
on AIM Ordinary Preference Loan stock
shares Shares
Level 1 Level 3 Level 3 Level 3
GBP GBP GBP GBP GBP
-------------------------------------------------- --------- ----------- ----------- ----------- ----------------
Cost at 31 March 2016 254,586 10,176,306 23,311 19,698,819 30,153,022
Unrealised gains/(losses) at 31 March 2016 8 (385,285) (1,037) 2,170,038 1,783,724
Permanent impairment at 31 March 2016 (254,586) (1,537,968) (739) (810,398) (2,603,691)
-------------------------------------------------- --------- ----------- ----------- ----------- ----------------
Valuation at 31 March 2016 8 8,253,053 21,535 21,058,459 29,333,055
Purchases at cost - 285,138 - 89,106 374,244
Sale proceeds - (16,801) - (42,425) (59,226)
(Decrease)/increase in unrealised
gains on investments (6) (1,402,372) (760) 1,287,809 (115,329)
Realised gains on investments - - - - -
-------------------------------------------------- --------- ----------- ----------- ----------- ----------------
Valuation at 30 September 2016 2 7,119,018 20,775 22,392,949 29,532,744
-------------------------------------------------- --------- ----------- ----------- ----------- ----------------
Book cost at 30 September 2016 254,586 8,974,064 23,311 19,757,232 29,009,193
Unrealised gains/(losses) at 30 September 2016 2 (976,520) (2,536) 2,635,717 1,656,663
Permanent impairment at 30 September 2016 (254,586) (878,526) - - (1,133,112)
-------------------------------------------------- --------- ----------- ----------- ----------- ----------------
Valuation at 30 September 2016 2 7,119,018 20,775 22,392,949 29,532,744
Unrealised (losses)/gains at 1 April 2016 (254,578) (1,923,253) (1,776) 1,359,640 (819,967)
Net movement in unrealised (depreciation)/
appreciation in the period (6) (1,402,372) (760) 1,287,809 (115,329)
Permanent impairments removed in the period - 1,470,579 - - 1,470,579
Realisation of previously unrealised
(losses)/gains - - - (11,732) (11,732)
-------------------------------------------------- --------- ----------- ----------- ----------- ----------------
(Losses)/gains on investments
at 30 September 2016 (254,584) (1,855,046) (2,536) 2,635,717 523,551
-------------------------------------------------- --------- ----------- ----------- ----------- ----------------
There has been no significant change in the risk analysis as disclosed in note 15 of the financial statements in the Company's Annual Report.
The increase in unrealised valuations of the loan stock investments above reflects the changes in the entitlement to loan premiums, and/or in the underlying enterprise value of the investee company. The increase does not arise from assessments of credit or market risk upon these instruments.
Level 3 unquoted equity and loan investments are valued in accordance with IPEVCV guidelines as follows:
As at As at As at
30 September 2016 31 March 30 September
2016 2015
(unaudited) (audited) (unaudited)
GBP GBP GBP
Investment methodology
Recent investment price 10,988,211 10,255,891 13,692,148
Earnings multiple 18,544,531 19,010,987 18,182,903
Estimated realisation proceeds - 66,169 -
------------------------------- ------------------ ---------- -------------
29,532,742 29,333,047 31,875,051
10. Current asset investments
As at As at As at
30 September 2016 31 March 30 September
2016 2015
(unaudited) (audited) (unaudited)
GBP GBP GBP
OEIC Money market funds 6,427,301 6,327,301 3,727,300
Bank deposits that mature within three months
but are not immediately repayable - 2,503,259 2,500,000
---------------------------------------------- ------------------ ---------- -------------
Cash equivalents per Condensed
Statement of Cash Flows 6,427,301 8,830,560 6,227,300
Bank deposits that mature after three months 507,061* 507,061 500,000
---------------------------------------------- ------------------ ---------- -------------
Current asset investments 6,934,362 9,337,621 6,727,300
---------------------------------------------- ------------------ ---------- -------------
Cash at bank and in hand 4,531,812 4,364,918 5,367,178
---------------------------------------------- ------------------ ---------- -------------
*Amount placed on 12 month term deposit on 10 March 2016.
11. Net asset value per share
As at As at As at
30 September 31 March 30 September
2016 2016 2015
(unaudited) (audited) (unaudited)
---------------------------------- ------------- ------------- -------------
Net assets GBP41,070,623 GBP43,141,012 GBP43,980,781
Number of shares in issue 35,824,744 36,068,463 36,218,463
Net asset value per share (pence) 114.64 p 119.61 p 121.43 p
---------------------------------- ------------- ------------- -------------
12. Post Balance Sheet Events
On 20 October 2016, GBP0.40 million was invested into BookingTek Limited.
13. Financial statements for the six months ended 30 September 2016
The financial information set out in this Half-Year financial report does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. The information for the year ended 31 March 2016 has been extracted from the latest published audited financial statements, which have been filed with the Registrar of Companies. The auditors have reported on these financial statements and that report was unqualified and did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.
14. Half-Year Report
Copies of the Half-Year Report are being sent to all shareholders. Further copies are available free of charge from the Company's registered office, 30 Haymarket, London, SW1Y 4EX, or can be downloaded via the Company's website at www.mig2vct.co.uk.
Contact details for further enquiries:
Rob Brittain or Jonathan McGuire at Mobeus Equity Partners LLP (the Company Secretary) on 020 7024 7600 or by e-mail on vcts@mobeusequity.co.uk .
Mobeus Equity Partners LLP (the Investment Adviser), on 020 7024 7600 or by e-mail on info@mobeusequity.co.uk.
DISCLAIMER
Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR FESFDEFMSEIF
(END) Dow Jones Newswires
November 22, 2016 08:53 ET (13:53 GMT)
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