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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Maven I&G 4 S | LSE:MAVS | London | Ordinary Share | GB00B1FPZ567 | S ORD 10P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 94.125 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
From May 2019 to May 2024
TIDMMAV4 TIDMMAVS
RNS Number : 5232B
Maven Income & Growth VCT 4 PLC
17 April 2012
Maven Income and Growth VCT 4 PLC
Annual Financial Report for the year ended 31 December 2011
Despite continued volatility for global quoted markets throughout the reporting period, and the resulting adverse impact on UK business and investor sentiment, the Board is pleased to report that your Company has achieved further positive shareholder returns during the year to 31 December 2011. Smaller companies are exposed to the wider market fragility, but your Company's private equity portfolio continues to perform well and in line with the Company's objective of generating long term capital appreciation and maintainable levels of tax-free income for shareholders.
The Manager seeks to invest in a wide range of attractively priced later-stage companies with defensive characteristics, predictable earnings and modest levels of debt, which are therefore well placed to withstand extended periods of challenging trading conditions. This approach has helped to deliver an increasing level of tax-free dividends for shareholders and steady growth in the underlying NAV. Your Board was encouraged to note that a recent AIC press release entitled 'VCT performance rivals conventional companies in 2011', which analysed the high representation of VCTs among the top performing investment companies during 2011, highlighted the fact that your Company was ranked 2nd of the top ten VCTs for share price total return during that period and was also showing strong positive returns over 3 years.
The Manager's ability to source high quality private company holdings was confirmed in the Deloitte Buyout Track 100 report published in February 2012, which tracks the performance of the top 100 private equity backed medium-sized companies in Britain over the past two years. Four portfolio companies feature in this report, which provides useful independent validation of the underlying quality of the assets held by your Company.
Performance
-- Total return on Ordinary shares of 118.5p per share (2010: 112.0p) at 31 December 2011, up 5.8% over the year and 24.7% since launch.
-- Net asset value (NAV) of Ordinary shares at the year end of 98.2p per share (2010: 95.7p).
-- Total return on S Shares of 112.65p per share (2010: 103.85p) at 31 December 2011, up 8.5% over the year and 18.6% since launch.
-- NAV of S Shares at the year end of 104.1p per share (2010: 97.3p). -- Five new later stage, yielding investments added during the year. -- Disposal of Walker Technical Resources, for a return of 3.0 times cost.
-- Final dividends proposed of 2.5p per Ordinary Share (2010: 2.5p) and 1.3p per S Share (2010: 0.5p).
-- A total of 4.0p declared per Ordinary share and 2.8p per S Share in respect of the year (2010: 3.5p and 1.5p respectively).
The most important measure of performance for a VCT is the total return, which is the long term record of dividend payments out of income and capital gains combined with the current NAV. The NAV in isolation is a less relevant measure of performance as the underlying investments are long-term in nature and not readily realisable.
Dividends
The Board is proposing a final dividend of 2.5p per Ordinary share and 1.3p per S share to be paid on 30 May 2012 to shareholders on the register on 9 May 2012. Including the interim dividends paid in September 2011, the tax-free yield for the year is 6.7% on the net cost (taking into account the initial tax relief available at time of investment) to Ordinary shareholders and 4% to S shareholders. Since the Company's launch, and after receipt of the proposed final dividend, Ordinary shareholders and S shareholders will have received 22.8p and 9.85p respectively in tax-free dividends.
Distributable Reserve
On 13 June 2011, the Court order approving the reduction in share premium account, as voted for by shareholders at the General Meeting on 1 February 2011, became effective. The purpose of the reduction was to provide the Company with greater flexibility in returning funds to shareholders, whether through the payment of dividends, share buy-backs or other means.
Principal risks and uncertainties
The Board has reviewed the principal risks and uncertainties facing the Company, which are set out in the annual report and are the risks involved in investment in small and unquoted companies. In order to reduce the exposure to investment risk, the Company has invested in a broadly-based portfolio of mature companies in the United Kingdom.
VCT Qualifying Status
The VCT qualifying status of the Company is reviewed regularly by your Board and monitored on a continuous basis by the Manager in order to ensure that all of the criteria for VCT qualifying status continue to be met. I can confirm that all tests were met throughout the year.
Investment Strategy
The Manager's investment strategy is to build a large and diversified portfolio of income producing, later stage private companies across a range of sectors and industries. The principal domicile of these companies will generally be in the UK, although many have an export dimension or overseas operations.
The Board and the Manager have previously concluded that the potential returns available from AIM and PLUS quoted investments are too uncertain, with very limited liquidity in many stocks and poor dividend yield in comparison with private equity investments. The Manager has therefore continued to selectively realise the AIM portfolio for value over the past 12 months, and redeploy the proceeds into investments in established, income-producing private companies.
Shareholder value is created through a combination of generating revenue from loan stock holdings and capital proceeds arising from profitable realisations, normally via an eventual trade sale of the business. To achieve this goal, new transactions are typically structured with 70% to 90% in secured, yielding loan stock, in companies where an equity stake can also be acquired at a reasonable entry price, and where the Manager perceives an opportunity to arbitrage a capital profit when the business achieves greater scale and maturity.
The revised Listing Rules require your Board to ensure that this and subsequent reports carry additional information on investment policy, in particular statements concerning asset mix, the spread of risk and maximum exposures. This information is contained in the Directors' Report and in the tabular analyses of the portfolio.
Valuation Process
Investments held by Maven Income and Growth VCT 4 in unquoted companies are valued in accordance with the International Private Equity And Venture Capital Valuation Guidelines.
Investments quoted or traded on a recognised stock exchange, including AIM, are valued at their bid prices.
Portfolio Developments
During the year your Company participated in five substantial new private company transactions, as well as ten follow-on investments intended to support the development of existing portfolio companies. Most of the existing private equity assets are trading acceptably or ahead of plan. There has also been significant recent acquisition interest in several portfolio companies and the Manager is currently working on the potential sale of a number of holdings, although there is no certainty that any of these discussions will result in successful exits.
In line with the strategy of reducing the exposure to AIM, a number of further disposals were made during the period and the portfolio is now almost exclusively invested in private companies, with AIM securities now representing only 4.2% and 1.5% of the asset base for the Ordinary Pool and S pool respectively (2010: Ordinary Pool 8.9%, S Pool 3.4%). The proceeds of those disposals are then available for investment in the further growth of the private equity portfolio.
Your Company continues to co-invest in each transaction with other Maven client funds, which allows the Manager to invest in a greater range and size of transaction on behalf of VCT clients than would otherwise be the case.
Recovery of VAT
The Board continues to pursue the recovery of VAT and interest on VAT paid on management fees paid in the years before October 2008 and is confident of making progress in this area. We expect that further sums will be recovered in due course.
Co-Investment Scheme of the Manager
The co-investment scheme, which allows executive members of the Manager to invest alongside the Company, continued in operation during the year. The scheme operates through a nominee company which invests alongside the Company in each and every transaction made by the Company, including any follow-on investments. The scheme more closely aligns the interests of the executives and the Company's shareholders while providing an incentive to enable the Manager to retain the existing skills and capacity of the Manager's investment team in a competitive market.
Share Capital
As reported previously, in the period to 29 April 2011 your Company raised further funds through the Maven Linked VCT Offer 2. An additional GBP395,843 was raised, at a cost of 5% of total funds raised, and 431,672 new shares were issued. In December 2011 your Board announced its intention to offer a further opportunity to acquire New Ordinary Shares and New S Ordinary Shares through a top-up Offer aiming to raise GBP1.25 million before expenses, which is within the maximum permitted under the prospectus rules and avoids the higher costs associated with publishing a full prospectus.
On 1 March 2012, the Company issued and allotted 482,424 New Ordinary Shares and 268,769 New S Ordinary Shares under the Offer. At that point the Offer had been over-subscribed and the Board announced its closure on 2 March 2012. The remaining shares will be allotted on 5 April 2012 for the 2011/2012 tax year and on 18 April 2012 for the 2012/2013 tax year.
The Company may use the money raised, under both the earlier top-up Offer and the latest Offer, to pay dividends and general running costs. This has the effect of preserving for investment purposes an equivalent sum of valuable 'old money' which operates under more advantageous VCT regulations. The proceeds of both Offers will provide additional liquidity for the Company to make further later-stage investments, and allow it to spread its costs over a larger asset base to the benefit of all Shareholders.
Outlook
Although the UK economy continues to face significant uncertainty, with widespread concerns over the prospects for growth and potential for rising inflation, well run cash-generative smaller companies continue to prosper. As a result of the persistent scarcity of bank debt available to growth companies looking for additional capital, there are continuing opportunities for well managed generalist VCTs to identify and invest in established, progressive businesses with strong balance sheets and proven business models. The Manager has been able to source a steady flow of private company introductions across the UK, allowing your Company to invest in good quality assets which are capable of generating significant income in support of a sustainable dividend programme.
Investors have been contending with record low interest rates since early 2009 and your Board recognises that regular tax-free income is a significant factor in VCT investment, alongside the ability to generate capital gains in the medium to long term. Your Company continues to build momentum, with a more established portfolio and improving dividends which bode well for future Shareholder returns.
Ian Cormack
Chairman
16 April 2012
Investment Manager's Review
Overview
The prospects for the UK economy remain uncertain, with most indicators suggesting low economic growth is likely to persist for a number of years ahead. This view is further supported by the Government's 2011 Autumn Statement which forecasts that the public sector borrowing requirement will increase over the next five years, and an extended period of spending restraint will be required in order to ensure that the UK maintains its current rating with the key credit agencies. This fiscal control and lower discretionary spend capacity is likely to impact on both consumer and investor confidence over the medium term.
Notwithstanding the challenges facing the UK economy, we are encouraged to note that the majority of private company assets in the portfolio are trading in line with expectations, and are creating value for our client investors through a combination of revenue generation to fund dividends, and capital growth.
The fundamental strategy pursued by Maven is to use its national presence and local advisory relationships to generate a high level of new transaction introductions each year, and to invest selectively and conservatively in earnings reliable and well managed private companies on prudent entry multiples. This approach has ensured positive shareholder returns have been consistently achieved in recent years and will continue to be at the cornerstone of our investment approach.
We believe there are continuing positive medium term prospects for potential deal flow in our target private equity market, as well resourced generalist VCT managers continue to be introduced to high quality later-stage private companies seeking capital to expand. Maven has been introduced to over 400 private company transactions around the UK in the past 12 months, mainly by a network of long-established contacts across the corporate finance and business community.
Investment Activity
During the year the Maven team completed five substantial new private equity investments on behalf for your company, alongside ten follow-on investments in existing portfolio companies. At the year end, the portfolio stood at 55 unlisted and AIM investments at a total cost of GBP12.7 million.
The following investments have been completed during the period.
Hot Features
Premium
Investment Date Sector Investment cost GBP'000 Website
Original S Share Pool
pool
Unlisted
Oil equipment
ATR Holdings Limited Feb-11 services 14 8 www.atrgroup.co.uk
Blackford Capital Nov-11 Food Producer 75 - No website available
Limited & Processor
Telecommunication
Camwatch Limited Aug-11 services 70 40 www.camwatch.co.uk
Claven Holdings
Limited Feb-11 Financial services 26 13 No website available
Corinthian Foods Nov-11 Food Producer 250 - No website available
Limited & Processor
Glacier Energy
Services Group Oil equipment
Limited Mar-11 services 119 99 www.glacier.co.uk
Lawrence Recycling
& Waste Management Dec-11 Support services 15 10 www.lawrenceskiphire.co.uk
LCL Hose Limited Sep-11 Manufacturing 149 99 www.dantec.ltd.uk
Lemac No.1 Limited Oct-11 Manufacturing 106 85 www.mcgavigan.com
Maven Co-invest
Exodus Limited Telecommunication
Partnership Jun-11 services 274 192 No website available
Moriond Limited Dec-11 Real Estate 200 150 No website available
Nessco Group Holdings Oil equipment
Limited Oct-11 services 31 50 www.nesscogroup.com
Space Student Living
Limited Jun-11 Support services 154 124 No website available
TC Communications
Holdings Limited May-11 Support services 43 27 www.tccommunications.co.uk
Torridon Capital
Limited Apr-11 Financial services 87 74 www.elite-insurance.co.uk
Total Unlisted
investment 1,613 971
--------- --------------------
AIM
Marechale Capital Financials
PLC Feb-11 services 3 1 www.marechalecapital.com
Marwyn Management Financials
Partners Jul-11 services 16 17 www.marwyn.com
Total AIM investment 19 18
--------- --------------------
Listed
Treasury 5.25%
7 June 2012 Dec-11 Gilt 600 250
600 250
--------- --------------------
Total 2,232 1,239
========= ====================
Unlisted Portfolio Developments
Five substantial private company investments were added to the portfolio during the period under review.
-- Glacier Energy Services, a profitable oil and gas service group with two specialist trading subsidiaries, Roberts Pipeline Machining and Wellclad. Roberts designs and manufactures on-site portable cutting machines for blue chip oil and gas clients. Wellclad provides services to the European offshore and subsea equipment market. Glacier is focused on growth within its core UK market as well as promoting its technologies to the international oil and gas market.
-- Space Student Living, a business providing contracted property management services across the student housing sector. Space aims to achieve significant growth across its consultancy services operation, in tandem with the acquisition of further long term management contracts.
-- Maven Co-invest Exodus, a new company trading as 60, established by Penta Capital to implement a buy-and-build strategy in the business telecommunications service sector based on the converging of mobile, fixed-line, broadband, internet and IT technology businesses. Penta is an established private equity firm with which Maven previously co-invested in the successful 2010 management buy-out of esure.
-- LCL Hose, (trading as Dantec) a specialist manufacturer of hand-built composite hoses for the global petrochemical industry. Composite hoses provide the vital flexible connection in many fluid transfer systems, and are used worldwide in applications such as unloading road, rail and marine tankers within chemical and oil plants, and in Formula 1 racing. Dantec exports around 70% of its output and is engaged in a number of significant overseas projects.
-- Moriond, a new company set up to acquire an established residential property portfolio at a significant discount to open market value. Maven will work on a joint venture basis with an experienced developer to break up the portfolio into single lots, carry out minor refurbishment, and then implement a structured sale of the individual assets over an 18-24 month period. The transaction is projected to generate a significant capital gain alongside a 6.5% paid yield through the life of the investment.
In a number of cases the Manager is also currently engaged with investee companies and prospective acquirers at various stages of a potential exit process. This realisation activity reflects the increasing maturity of a number of holdings, but it should be noted that there can be no certainty that these discussions will ultimately lead to profitable sales.
There was one notable private company exit during the period. The investment in Dalglen 1150 (Walker Technical Resources) was realised in July with further proceeds received on agreement of completion accounts. Total proceeds over the life of the investment were GBP1.05m representing an overall 3.0 times return on the initial investment cost. The exit was via a secondary buy-out, funded by Gresham Private Equity, just two years after Maven originally led the management buy-in in June 2009. Walker, which provides some of the most advanced composite repairs technology available for the global oil & gas industry, has consistently traded ahead of budget and has more than doubled earnings since the initial investment.
The table on page 13 gives details of realisations during the reporting period.
Ordinary Shares S Shares
Cost Value Realised Cost Value Realised
Date Complete/ of shares at 31 Realised gain/(loss) of shares at 31 gain/(loss)
first partial disposed December Sales gain/ over December disposed December Sales Realised over December
invested exit of 2010 proceeds (loss) 2010 Valuation of 2010 proceeds gain/(loss) 2010 Valuation
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------- ---------- ----------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
Unlisted
Ailsa Craig
Capital
Limited 2009 Complete 249 249 249 - - 169 169 169 - -
Atlantic
Foods Group
Limited 2008 Partial - - - - - 56 56 63 7 7
Attraction
World
Holdings
Limited 2010 Partial 39 47 39 - (8) 30 30 30 - -
Dalglen
(1150)
(trading
as Walker
Technical
Resources) 2009 Complete 249 592 627 378 35 99 264 251 152 -13
Dunning
Capital
Limited 2009 Complete 249 249 249 - - 149 149 149 - -
Essential
Viewing
Systems 2001 Complete 192 166 239 47 73 - - - -
Oliver Kay 2007 Partial 4 4 4 - - - - - -
Shiskine
Capital
Limited 2009 Complete 249 249 249 - - 149 149 149 - -
Tosca Penta
Investments
Limited
Partnership 2010 Partial 13 13 13 - - 13 18 13 - (5)
Others 71 27 31 (40) 4 37 14 16 (21) 2
1,315 1,596 1,700 385 104 702 849 840 138 (9)
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
AIM
Brookwell
Limited 2011 Partial 22 15 17 (5) 2 5 3 4 (1) 1
Individual
Restaurant
Company 2006 Complete 47 4 4 (43) - - - - - -
OPG Power
Ventures 2008 Complete 39 52 55 16 3 39 52 56 17 4
Praesepe Plc 2008 Complete 49 12 17 (32) 5 50 12 17 (33) 5
Software
Radio
Technology 2005 Partial 8 10 12 4 2 - - - - -
System C
Healthcare 2005 Complete 150 0 194 44 194 - - - - -
Others 66 0 35 (31) 35 132 - 70 (62) 70
381 93 334 (47) 241 226 67 147 (79) 80
---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ---------------- ----------------
1,696 1,689 2,034 338 345 928 916 987 59 71
================ ================ ================ ================ ================ ================ ================ ================ ================ ================
One unlisted investment and one AIM company were struck off the Register during the year resulting in a realised losses of GBP232,000 (cost GBP267,000) and GBP62,000 (cost GBP132,000) for the Ordinary Share Pool and S Share Pool respectively. This had no effect on the NAV as a full provision had been made in earlier years.
In respect of AIM holdings the Manager has continued its policy of structured exits from this part of the portfolio. Four AIM securities were purchased by a closed ended investment company established to acquire investments which were underperforming or trading below entry price. These transactions incurred realised losses of GBP126,000 (cost GBP179,000) and GBP41,000 (cost GBP52,000) for the Ordinary Share Pool and S Share Pool respectively during the year.
Outlook
Your Company's portfolio has benefitted from significant diversification in recent years, with a specific focus on investing in a wide range of later-stage private companies with income generating characteristics. There is increased competition among providers of alternative capital for access to attractive private equity transactions, and good quality private company opportunities are at a premium. However with one of the most highly resourced and experienced management teams in the industry, Maven has access to a UK-wide network of introducers and is therefore well placed to continue to expand the asset base and consistently grow shareholder value.
INCOME
STATEMENT
For the year
ended 31
December 2011
Ordinary Shares S Ordinary Shares TOTAL
Revenue Capital Total Revenue Capital Total Revenue Capital Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
Gains on
investments 8 - 546 546 - 350 350 - 896 896
Income from
investments 2 393 - 393 240 - 240 633 - 633
Other income 2 1 - 1 - - - 1 - 1
Investment
management
fees 3 (53) (212) (265) (15) (62) (77) (68) (274) (342)
Other
expenses 4 (176) - (176) (102) - (102) (278) - (278)
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
Net Return on
ordinary
activities
before
taxation 165 334 499 123 288 411 288 622 910
Tax on
ordinary
activities 5 (32) 32 - (12) 12 - (44) 44 -
-------------- ------ -------------- -------------- --------------
Return
attributable
to
Equity
Shareholders 133 366 499 111 300 411 244 666 910
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
Earnings per
share
(pence) 1.5 4.3 5.8 2.3 6.1 8.4 3.8 10.4 14.2
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
A Statement of Total Recognised Gains and Losses has not been prepared, as all gains and losses are recognised in the Income Statement.
All items in the above statement are derived from continuing operations. The Company has only one class of business and derives its income from investments made in shares, securities and bank deposits.
The total column of this statement is the Profit and Loss Account of the Company.
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
For the year ended 31 December 2011
S Ordinary
Ordinary Shares Shares TOTAL
GBP'000 GBP'000 GBP'000
Opening Shareholders' funds 7,964 4,801 12,765
Net return for year 499 411 910
Net proceeds of share issue 377 - 377
Repurchase and cancellation
of shares (261) (55) (316)
Dividends paid - revenue (43) (25) (68)
Dividends paid - capital (305) (74) (379)
Closing Shareholders' funds 8,231 5,058 13,289
------------------------------ ---------------- ------------- -------------
The accompanying Notes are an integral part of the Financial Statements.
INCOME STATEMENT
For the year ended 31 December 2010
Ordinary Shares S Ordinary Shares TOTAL
Revenue Capital Total Revenue Capital Total Revenue Capital Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
Gains on
investments 8 - 799 799 - 278 278 - 1,077 1,077
Income from
investments 2 229 - 229 121 - 121 350 - 350
Other income 2 - - - - - - - - -
Investment
management
fees 3 (14) (57) (71) (14) (55) (69) (28) (112) (140)
Other
expenses 4 (201) - (201) (122) - (122) (323) - (323)
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
Net Return on
ordinary
activities
before
taxation 14 742 756 (15) 223 208 (1) 965 964
Tax on
ordinary
activities 5 (1) 1 - - - - (1) 1 -
-------------- ------ -------------- -------------- --------------
Return
attributable
to Equity
Shareholders 13 743 756 (15) 223 208 (2) 966 964
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
Earnings per
share
(pence) 0.2 9.0 9.2 (0.3) 4.5 4.2 (0.1) 13.5 13.4
-------------- ------ -------------- -------------- -------------- -------------- -------------- ------------- -------------- -------------- -------------
A Statement of Total Recognised Gains and Losses has not been prepared, as all gains and losses are recognised in the Income Statement.
All items in the above statement are derived from continuing operations. The Company has only one class of business and derives its income from investments made in shares, securities and bank deposits.
The total column of this statement is the Profit and Loss Account of the Company.
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
For the year ended 31 December 2010
Ordinary Shares S Ordinary Shares TOTAL
GBP'000 GBP'000 GBP'000
Opening Shareholders' funds 6,996 4,693 11,689
Net return for year 756 208 964
Net proceeds of share issue 605 - 605
Repurchase and cancellation
of shares (98) (26) (124)
Dividends paid - revenue (42) (25) (67)
Dividends paid - capital (253) (49) (302)
Closing Shareholders' funds 7,964 4,801 12,765
------------------------------ ---------------- ------------------ -------------
The accompanying Notes are an integral part of the Financial Statements.
BALANCE SHEET
As at 31 December 2011
31 December 2011 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Total Shares Shares Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------- ------- --------------------- --------------------- --------------------- -------------------- --------------------- --------------------
Fixed assets
Investments at
fair value
through
profit or
loss 8 7,697 4,603 12,300 6,956 4,002 10,958
Current assets
Debtors 10 233 125 358 167 78 245
Cash and
overnight
deposits 399 356 755 890 753 1,643
--------------- ------- --------------------- --------------------- --------------------- -------------------- --------------------- --------------------
632 481 1,113 1,057 831 1,888
Creditors:
Amounts
falling due
within one
year 11 (98) (26) (124) (49) (32) (81)
--------------------- --------------------- --------------------- -------------------- --------------------- --------------------
Net current
assets 534 455 989 1,008 799 1,807
--------------- ------- --------------------- --------------------- --------------------- -------------------- --------------------- --------------------
Total net
assets 8,231 5,058 13,289 7,964 4,801 12,765
--------------- ------- --------------------- --------------------- --------------------- -------------------- --------------------- --------------------
Capital and
reserves
Called up
share capital 12 839 486 1,325 832 494 1,326
Share premium
account 13 - - - 538 4,227 4,765
Capital
reserve -
realised 13 611 - 611 1,085 106 1,191
Capital
reserve -
unrealised 13 (701) 294 (407) (1,236) (38) (1,274)
Distributable
reserve 13 7,168 4,149 11,317 6,539 (26) 6,513
Capital
redemption
reserve 13 37 8 45 19 3 22
Revenue
reserve 13 277 121 398 187 35 222
Net assets
attributable
to Ordinary
Shareholders 8,231 5,058 13,289 7,964 4,801 12,765
--------------- ------- --------------------- --------------------- --------------------- -------------------- --------------------- --------------------
Net asset
value per
ordinary
share (pence) 14 98.2 104.1 95.7 97.3
--------------- ------- --------------------- --------------------- --------------------- -------------------- --------------------- --------------------
The Financial Statements of Maven Income and Growth VCT 4 PLC, registered number SC272568, were approved by the Board of Directors and were signed on its behalf by:
16 April 2012
The accompanying Notes are an integral part of the Financial Statements.
CASH FLOW STATEMENT
For the year ended
31 December
2011
Year ended 31 December
2011 Year ended 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Total Shares Shares Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------- ------- --------------------- --------------------- --------------------- --------------------- --------------------- ---------------------
Operating activities
Investment income
received 328 193 521 226 109 335
Deposit interest
received 1 - 1 - - -
Investment
management fees
paid (200) (71) (271) (82) (77) (159)
Secretarial fees
paid (66) (41) (107) (48) (33) (81)
Directors expenses
paid (41) (25) (66) (39) (26) (65)
Other cash payments (85) (48) (133) (111) (63) (174)
--------------------- ------- --------------------- --------------------- --------------------- --------------------- --------------------- ---------------------
Net cash
(outflow)/inflow
from
operating
activities 15 (63) 8 (55) (54) (90) (144)
Taxation
Corporation tax - - - (22) (5) (27)
--------------------- ------- --------------------- --------------------- --------------------- --------------------- --------------------- ---------------------
Financial investment
Purchase of
investments (2,284) (1,250) (3,534) (1,401) (1,829) (3,230)
Sale of investments 2,088 999 3,087 1,399 945 2,344
--------------------- ------- --------------------- --------------------- --------------------- --------------------- --------------------- ---------------------
Net cash outflow
from financial
investment (196) (251) (447) (2) (884) (886)
Equity dividends
paid (348) (99) (447) (295) (74) (369)
--------------------- ------- --------------------- --------------------- --------------------- --------------------- --------------------- ---------------------
Net cash outflow
before financing (607) (342) (949) (373) (1,053) (1,426)
Financing
Issue of Ordinary
Shares 377 - 377 605 - 605
Repurchase of
Ordinary Shares (261) (55) (316) (98) (26) (124)
Net cash
inflow/(outflow)
from
financing 116 (55) 61 507 (26) 481
--------------------- ------- --------------------- --------------------- --------------------- ---------------------
(Decrease)/increase
in cash 16 (491) (397) (888) 134 (1,079) (945)
--------------------- ------- --------------------- --------------------- --------------------- --------------------- --------------------- ---------------------
The accompanying Notes are an integral part of the Financial Statements.
Notes to the Financial Statements
For the year ending 31 December 2011
1 Accounting Policies - UK Generally Accepted Accounting Practice
(a) Basis of preparation
The Financial Statements have been prepared under the historical cost convention modified to include the revaluation of investments and in accordance with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies' and Venture Capital Trusts (the SORP) issued in January 2009. The disclosures on Going Concern on page 29 of the Directors' Report form part of these financial statements.
(b) Income
Dividends receivable on equity shares and unit trusts are treated as revenue for the period on an ex-dividend basis. Where no ex-dividend date is available dividends receivable on or before the year end are treated as revenue for the period. Provision is made for any dividends not expected to be received. The fixed returns on debt securities and non-equity shares are recognised on a time apportionment basis so as to reflect the effective interest rate on the debt securities and shares. Provision is made for any fixed income not expected to be received. Interest receivable from cash and short term deposits and interest payable are accrued to the end ofthe year.
(c) Expenses
All expenses are accounted for on an accruals basis and charged to the income statement. Expenses are charged through the revenue account except as follows:
- expenses which are incidental to the acquisition and disposal of an investment are charged to capital.
- expenses are charged to realised capital reserves where a connection with the maintenance or enhancement of the value of the investments can be demonstrated. In this respect the investment management fee has been allocated 20% to revenue and 80% to realised capital reserves to reflect the Company's investment policy and prospective income and capital growth.
- share issue costs are charged to the share premium account: and
- expenses are allocated between the original pool or the S share pool depending on the nature of the expense.
(d) Taxation
Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date, where transactions or events that result in an obligation to pay more tax in the future or right to pay less tax in the future have occurred at the balance sheet date. This is subject to deferred tax assets only being recognised if it is considered more likely than not that there will be suitable profits from which the future reversal of the underlying timing differences can be deducted. Timing differences are differences arising between the Company's taxable profits and its results as stated in the Financial Statements which are capable of reversal in one or more subsequent periods.
Deferred tax is measured on a non-discounted basis at the tax rates that are expected to apply in the periods in which timing differences are expected to reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date.
The tax effect of different items of income/gain and expenditure/loss is allocated between capital reserves and revenue account on the same basis as the particular item to which it relates using the Company's effective rate of tax for the period.
UK Corporation tax is provided at amounts expected to be paid/recovered using the tax rates and laws that have been enacted or substantively enacted at the balance sheet date.
(e) Investments
In valuing unlisted investments the Directors follow the criteria set out below. These procedures comply with the revised International Private Equity and Venture Capital Valuation Guidelines for the valuation of private equity and venture capital investments. Investments are recognised at their trade date and are designated by the Directors as fair value through profit or loss. At subsequent reporting dates, investments are valued at fair value, which represent the Directors' view of the amount for which an asset could be exchanged between knowledgeable willing parties in an arm's length transaction. This does not assume that the underlying business is saleable at the reporting date or that its current shareholders have an intention to sell their holding in the near future.
A financial asset or liability is generally derecognised when the contract that gives rise to it is settled, sold, cancelled or expires.
1. For Investments completed within the 12 months prior to the reporting date and those at an early stage in their development, fair value is determined using the Price of Recent Investment Method, except that adjustments are made when there has been a material change in the trading circumstances of the company or a substantial movement in the relevant sector of the stock market.
2. Whenever practical, recent investments will be valued by reference to a material arm's length transaction or a quoted price.
3. Mature companies are valued by applying a multiple to their fully taxed prospective earnings to determine the enterprise value of the company.
3.1 To obtain a valuation of the total ordinary share capital held by management and the institutional investors, the value of third party debt, institutional loan stock, debentures and preference share capital is deducted from the enterprise value. The effect of any performance related mechanisms is taken into account when determining the value of the ordinary share capital.
3.2 Preference shares, debentures and loan stock are valued using the Price of Recent Investment Method. When a redemption premium has accrued, this will only be valued if there is a reasonable prospect of it being paid. Preference shares which carry a right to convert into ordinary share capital are valued at the higher of the Price of Recent Investment Method basis and the price/earnings basis, both described above.
3. Where there is evidence of impairment, a provision may be taken against the previous valuation of the investment.
4. In the absence of evidence of a deterioration, or strong defensible evidence of an increase in value, the fair value is determined to be that reported at the previous balance sheet date.
5. All unlisted investments are valued individually by the Portfolio Management Team of Maven Capital Partners UK LLP. The resultant valuations are subject to detailed scrutiny and approval by the Directors of the Company.
7. In accordance with normal market practice, investments listed on the Alternative Investment Market or a recognised stock exchange are valued at their bid market price.
(f) Fair Value Measurement
Fair value is defined as the price that the Company would receive upon selling an investment in a timely transaction to an independent buyer in the principal or the most advantageous market of the investment. A three-tier hierarchy has been established to maximise the use of observable market data and minimise the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk, for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable. Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity. Unobservable inputs are inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on best information available in the circumstances.
The three-tier hierarchy of inputs is summarised in the three broad levels listed below.
- Level 1 - quoted prices in active markets for identical investments
- Level 2 - other significant observable inputs (included quoted prices for similar investments, interest rates, prepayment speeds, credit risk etc).
- Level 3 - significant unobservable inputs (including the Company's own assumptions in determining the fair value of investments).
(g) Gains and losses on investments
When the company sells or revalues its investments during the year, any gains or losses arising are credited/ charged to the Income Statement.
Notes to the Financial Statements
Year ended Year ended
31 December 2011 31 December 2010
Ordinary S Ordinary Total Ordinary S Ordinary Total
Shares Shares Shares Shares
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
2 Income
Income from
investments:
UK franked
investment
income 6 1 7 9 2 11
UK unfranked
investment
income 387 239 626 220 119 339
-------------- ------------------ ------------------- ---------------- ------------------- ------------------- -----------------
393 240 633 229 121 350
Other Income:
Deposit
interest 1 - 1 - - -
Total income 394 240 634 229 121 350
-------------- ------------------ ------------------- ---------------- ------------------- ------------------- -----------------
Total income
comprises:
Dividends 6 1 7 9 2 11
Interest 388 239 627 220 119 339
394 240 634 229 121 350
-------------- ------------------ ------------------- ---------------- ------------------- ------------------- -----------------
Year ended
31 December 2011
Ordinary Shares S Ordinary Shares TOTAL
Revenue Capital Total Revenue Capital Total Revenue Capital Total
3 Investment
management
fees GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Investment
management
fees 26 103 129 15 62 77 41 165 206
Performance
fees 27 109 136 - - - 27 109 136
53 212 265 15 62 77 68 274 342
------------- ----------------- ---------------- -------------- ------------------- ------------------- ----------------- --------------- -------------- ---------------
Year ended
31 December 2010
Ordinary Shares S Ordinary Shares TOTAL
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
Investment
management
fees 28 114 142 19 73 92 47 187 234
VAT reclaim (14) (57) (71) (5) (18) (23) (19) (75) (94)
14 57 71 14 55 69 28 112 140
------------ ------------------ ------------------ ---------------- ------------------- ------------------ ---------------- ---------------- ---------------- -----------------
Details of the fee basis are contained in the Director's Report on page 24.
Year ended
31 December 2011
Ordinary Shares S Ordinary Shares TOTAL
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
4 Other
expenses
Secretarial
fees 54 - 54 33 - 33 87 - 87
Directors'
remuneration 41 - 41 25 - 25 66 - 66
Fees to
auditors -
audit
services 10 - 10 6 - 6 16 - 16
Fees to
auditors -
tax
services 3 - 3 1 - 1 4 - 4
Miscellaneous
expenses 68 - 68 37 - 37 105 - 105
176 - 176 102 - 102 278 - 278
--------------- ------------------ ------------------- ---------------- ------------------ ------------------- ---------------- ---------------- ----------------- -----------------
Year ended
31 December 2010
Ordinary Shares S Ordinary Shares TOTAL
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
Secretarial
fees 49 - 49 33 - 33 82 - 82
Directors'
remuneration 39 - 39 26 - 26 65 - 65
Fees to
Auditor -
audit
services 9 - 9 6 - 6 15 - 15
Fees to
Auditor - tax
services 3 - 3 1 - 1 4 - 4
Miscellaneous
expenses 101 - 101 56 - 56 157 - 157
201 - 201 122 - 122 323 - 323
--------------- ------------------ ------------------- ---------------- ------------------ ------------------- ---------------- ---------------- ----------------- -----------------
Year ending 31 December 2011
Ordinary Ordinary Ordinary S Ordinary S Ordinary S Ordinary Total
Shares Shares Shares Shares Shares Shares
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
5 Tax on ordinary
activities
Corporation tax (32) 32 - (12) 12 - (44) 44 -
----------------------- --------------------- ------------------- ------------------------ --------------------- --------------------- --------------------- ----------------- ------------------ --------------------
Year ending 31 December 2010
Ordinary Ordinary Ordinary S Ordinary S Ordinary S Ordinary Total
Shares Shares Shares Shares Shares Shares
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
Corporation tax (1) 1 - - - - (1) 1 -
----------------------- --------------------- ------------------- ------------------------ --------------------- --------------------- --------------------- ------------------ ----------------- --------------------
The tax assessed for the period is lower than the standard rate of corporation tax of 26% (2010: 28%). The differences are explained below:
Year ending 31 December 2011
Ordinary Ordinary Ordinary S Ordinary S Ordinary S Ordinary Total
Shares Shares Shares Shares Shares Shares
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
Return on
ordinary
activities
before tax 165 334 499 123 288 411 288 622 910
------------- --------------------- -------------------- ------------------------ --------------------- --------------------- --------------------- ------------------ ------------------ ------------------
Revenue
return on
ordinary
activities 43 87 130 32 75 107 75 162 237
multiplied by standard rate of
corporation tax
Non taxable
UK dividend
income (2) - (2) - - - (2) - (2)
Gains on
investments - (142) (142) - (91) (91) - (233) (233)
Utilisation
of taxable
losses - - - (16) - (16) (16) - (16)
Smaller
Companies
relief (9) 23 14 (4) 4 - (13) 27 14
32 (32) - 12 (12) - 44 (44) -
------------- --------------------- -------------------- ------------------------ --------------------- --------------------- --------------------- ------------------ ------------------ ------------------
Losses with a tax value of GBP29,742 (2010: GBP34,447) are available to carry forward against future trading profits. These have not been recognised as a deferred tax asset as recoverability is not sufficiently certain.
Year ending 31 December 2010
Ordinary Ordinary Ordinary S Ordinary S Ordinary S Ordinary Total
Shares Shares Shares Shares Shares Shares
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
Return on
ordinary
activities
before tax 14 742 756 (15) 223 208 (1) 965 964
------------- --------------------- -------------------- ------------------------ --------------------- --------------------- --------------------- ------------------ ------------------ ------------------
Revenue
return on
ordinary
activities 4 208 212 (4) 62 58 - 270 270
multiplied by standard rate of
corporation tax
Non taxable
UK dividend
income (3) - (3) - - - (3) - (3)
Gains on
investments - (224) (224) - (78) (78) - (302) (302)
Utilisation
of taxable
losses - - - - - - - - -
Smaller
Companies
relief - 15 15 4 16 20 4 31 35
1 (1) - - - - 1 (1) -
------------- --------------------- -------------------- ------------------------ --------------------- --------------------- --------------------- ------------------ ------------------ ------------------
6 Dividends Year ended Year ended
31 December 2011 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Total Shares Shares Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue
dividends
Final revenue
dividend for
the year
ended
31 December
2010 of Nil
(2009: 0.5p) - - - 42 25 67
Interim
revenue
dividend for
the year
ended
31 December
2011 of 0.5p
(2010: Nil)
paid on 28
September
2011 43 25 68 - - -
43 25 68 42 25 67
-------------- ------------------------ -------------------- ------------------------ --------------------- --------------------- ---------------------
Capital
dividends
Final capital
dividend for
the year
ended
31 December
2010 of 2.5p
(2009: 2.0p)
paid on 27
May 2011 219 - 219 169 - 169
Final capital
dividend for
the year
ended
31 December
2010 of 0.5p
(2009: Nil)
paid on 27
May 2011 - 25 25 - - -
Interim
capital
dividend for
the year
ended
31 December
2011 of 1.0p
(2010: 1.0p)
paid on 28
September
2011 86 49 135 84 49 133
305 74 379 253 49 302
-------------- ------------------------ -------------------- ---------------------- --------------------- --------------------- ---------------------
Revenue
dividends
We set out below the total dividends
proposed
in respect of the financial year, which
is the
basis on which the requirements of Section 274 of the
Income Tax Act 2007 are considered.
Revenue
available
for
distribution
by
way of
dividends
for the year 133 111 244 13 (15) (2)
-------------- ------------------------ -------------------- ---------------------- --------------------- --------------------- ---------------------
Final revenue
dividend
proposed for
the year
ended 31
December
2011 of 0.6p
(2010: Nil)
payable on
20 May 2012 51 - 51 - - -
Final revenue
dividend
proposed for
the year
ended 31
December
2011 of 1.3p
(2010: Nil)
payable on
20 May 2012 - 64 64 - - -
51 64 115 - - -
-------------- ------------------------ -------------------- ---------------------- --------------------- --------------------- ---------------------
Capital
dividends
Final capital
dividend
proposed for
the year
ended 31
December
2011 of 1.9p
(2010: 2.5p)
payable on
20 May 2012 162 - 162 206 - 206
Final capital
dividend
proposed for
the year
ended 31
December - - - - 25 25
2011 of Nil
(2010: 0.5p)
162 - 162 206 25 231
-------------- ------------------------ -------------------- ------------------------ --------------------- -------------------- --------------------
Year ended Year ended
31 December 2011 31 December 2010
7 Return per
ordinary
share
The returns
per share
have been
based
on the
following Ordinary S Ordinary Ordinary S Ordinary
figures: Shares Shares Total Shares Shares Total
Weighted
average
number of
ordinary
shares 8,541,693 4,917,310 13,459,003 8,243,192 4,937,304 13,180,496
Revenue
return GBP133,000 GBP111,000 GBP244,000 GBP13,000 (GBP15,000) (GBP2,000)
Capital
return GBP366,000 GBP300,000 GBP666,000 GBP743,000 GBP223,000 GBP966,000
Total Return GBP499,000 GBP411,000 GBP910,000 GBP756,000 GBP208,000 GBP964,000
-------------- ------------------------ -------------------- ------------------------ --------------------- -------------------- --------------------
8 Investments
Year ended 31 December 2011
Ordinary Shares S Ordinary Shares Total
Listed AIM Unlisted/AIM Listed AIM Unlisted/AIM Listed AIM Unlisted/AIM
(quoted (quoted (unobservable (quoted (quoted (unobservable (quoted (quoted (unobservable
prices) prices) inputs) Total prices) prices) inputs) Total prices) prices) inputs) Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Movements
during
the year:
Valuation at
1
January 2011 - 710 6,246 6,956 - 162 3,840 4,002 - 872 10,086 10,958
Unrealised
loss/(gain) - 1,087 149 1,236 - 274 (236) 38 - 1,361 (87) 1,274
-------------- ----------------------- -------------------- ------------------------- ---------------- ---------------- ------------------ ------------------------- ----------------- ---------------- -------------------- ------------------------- -------------------
Cost at 1
January
2011 - 1,797 6,395 8,192 - 436 3,604 4,040 - 2,233 9,999 12,232
Purchases 600 71 1,613 2,284 250 29 971 1,250 850 100 2,584 3,534
Sales
proceeds - (387) (1,700) (2,087) - (158) (840) (998) - (545) (2,540) (3,085)
Realised
gains - (173) 184 11 - (120) 138 18 - (293) 322 29
Amortisation
of
book cost (2) - - (2) (1) - - (1) (3) - - (3)
-------------- ----------------------- -------------------- ------------------------- ---------------- ---------------- ------------------ ------------------------- ----------------- ---------------- -------------------- ------------------------- -------------------
Cost at 31
December
2011 598 1,308 6,492 8,398 249 187 3,873 4,309 847 1,495 10,365 12,707
Unrealised
(loss)/gain (1) (962) 262 (701) (1) (112) 407 294 (2) (1,074) 669 (407)
Valuation at
31
December
2011 597 346 6,754 7,697 248 75 4,280 4,603 845 421 11,034 12,300
-------------- ----------------------- -------------------- ------------------------- ---------------- ---------------- ------------------ ------------------------- ----------------- ---------------- -------------------- ------------------------- -------------------
Note 1(f) defines the three tier hierarchy of investments, and the significance of the information used to determine their fair value, that is required by Financial Reporting Standard 29 "Financial Instruments: Disclosures".
Year ended 31 December 2010
Ordinary Shares S Ordinary Shares Total
AIM Unlisted/AIM AIM Unlisted/AIM AIM Unlisted/AIM
(quoted (unobservable (quoted (unobservable (quoted (unobservable
prices) inputs) Total prices) inputs) Total prices) inputs) Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Valuation at
1 January
2010 1,211 4,945 6,156 522 2,319 2,841 1,733 7,264 8,997
Unrealised
loss 1,323 667 1,990 160 32 192 1,483 699 2,182
-------------- -------------------- ----------------------- -------------- ------------------ ------------------------ ---------------- -------------------- ----------------------- ----------------
Cost at 1
January
2010 2,534 5,612 8,146 682 2,351 3,033 3,216 7,963 11,179
Purchases - 1,401 1,401 - 1,829 1,829 - 3,230 3,230
Sales
proceeds (772) (628) (1,400) (363) (583) (946) (1,135) (1,211) (2,346)
Realised
gains 35 10 45 117 7 124 152 17 169
-------------- -------------------- ----------------------- -------------- ------------------ ------------------------ ---------------- -------------------- ----------------------- ----------------
Cost at 31
December
2010 1,797 6,395 8,192 436 3,604 4,040 2,233 9,999 12,232
Unrealised
(loss)/gain (1,087) (149) (1,236) (274) 236 (38) (1,361) 87 (1,274)
Valuation at
31 December
2010 710 6,246 6,956 162 3,840 4,002 872 10,086 10,958
-------------- -------------------- ----------------------- -------------- ------------------ ------------------------ ---------------- -------------------- ----------------------- ----------------
31 December 2011 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Total Shares Shares Total
The portfolio
valuation GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Held at market
valuation:
Listed fixed income 597 248 845 - - -
AIM quoted equities 346 75 421 710 162 872
AIM unobservable
equities - - - - - -
943 323 1,266 710 162 872
-------------------------- ----------- ------------------------- ---------------- ---------------- ------------------ -------------------------
Unlisted at
Directors'
valuation:
---------------------- --- ----------- ------------------------- ---------------- ---------------- ------------------ -------------------------
Unquoted unobservable
equities 2,403 1,615 4,018 1,849 1,207 3,056
--------------------------- ----------- ------------------------- ---------------- ---------------- ------------------ -------------------------
Unquoted unobservable
fixed income 4,351 2,665 7,016 4,397 2,633 7,030
--------------------------- ----------- ------------------------- ---------------- ---------------- ------------------ -------------------------
6,754 4,280 11,034 6,246 3,840 10,086
-------------------------- ----------- ------------------------- ---------------- ---------------- ------------------ -------------------------
Total 7,697 4,603 12,300 6,956 4,002 10,958
--------------------------- ----------- ------------------------- ---------------- ---------------- ------------------ -------------------------
Realised gains on
historical
basis 11 18 29 45 124 169
--------------------------- ----------- ------------------------- ---------------- ---------------- ------------------ -------------------------
Net movement in unrealised
appreciation 535 332 867 754 154 908
Gains on investments 546 350 896 799 278 1,077
--------------------------- ------- ------------------------- ---------------- ---------------- ------------------ -------------------------
9 Participating and significant interests
The principal activity of the Company is to select and hold a portfolio of investments in unlisted and AIM securities. Although the Company will, in some cases, be represented on the board of the investee company, it will not take a controlling interest or become involved in its management. The size and structure of the companies with unlisted and AIM securities may result in certain holdings in the portfolio representing a participating interest without there being any partnership, joint venture or management consortium agreement.
At 31 December 2011, the Company held no shares amounting to 20% or more of the equity capital of any of the unlisted or AIM undertakings. The Company does hold shares or units amounting to more than 3% or more of the nominal value of the allotted shares or units of any class in certain investee companies.
Details of equity percentages held are shown in the Investment Portfolio Summary on page 15.
31 December 2011 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Total Shares Shares Total
10 Debtors GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Prepayments and accrued income 231 124 355 166 77 243
Other debtors 2 1 3 1 1 2
233 125 358 167 78 245
-------------------------------- ---------- ------------ -------- ---------- ------------ --------
11 Creditors
Accruals 98 26 124 49 32 81
98 26 124 49 32 81
-------------------------------- ---------- ------------ -------- ---------- ------------ --------
31 December 2011 31 December 2010
Ordinary Shares S Ordinary Shares Ordinary Shares S Ordinary Shares
12 Share
capital Number GBP'000 Number GBP'000 Number GBP'000 Number GBP'000
At 31 December the authorised
share
capital comprised:
allotted,
issued and
fully
paid:
Ordinary
Shares of
10p each
Balance
brought
forward 8,323,130 832 4,936,009 494 7,798,296 780 4,972,459 497
Repurchased
and
cancelled
in
year (368,213) (36) (75,000) (8) (152,065) (15) (36,450) (3)
------------- ----------------- --------------------- ------------------- ------------------ ---------------- -------------------- --------------------- ----------------
7,954,917 796 4,861,009 486 7,646,231 765 4,936,009 494
Issued
during the
year 431,672 43 - - 676,899 67 - -
-------------
8,386,589 839 4,861,009 486 8,323,130 832 4,936,009 494
============= ================= ===================== =================== ================== ================ ==================== ===================== ================
During the year 368,213 Ordinary Shares (2010:152,065) of 10p each were repurchased by the Company at a total cost of GBP261,977 (2010: GBP98,361) and
cancelled.
During the year 75,000 S Ordinary Shares (2010:36,450) of 10p each were repurchased by the Company at a total cost of GBP54,866 (2010: GBP26,020) and
cancelled.
During the year the Company issued 431,672 Ordinary Shares (2010: 676,899) pursuant to the linked offer at a subscription price of 91.7p per share (2010: 89.5p).
Share Capital Capital Capital
premium Distributable reserves reserves redemption Revenue
account reserve realised unrealised reserve reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
13 Reserves
Ordinary
Shares
At 1 January
2011 538 6,539 1,085 (1,236) 19 187
Gains on
sales of
investments - - 11 - - -
Net increase
in value of
investments - - - 535 - -
Investment
management
fees - - (212) - - -
Dividends
paid - - (305) - - (43)
Tax effect of
capital items - - 32 - - -
Share Issue -
1 February
2011 75 - - - - -
Share Issue -
5 April 2011 207 - - - - -
Share Issue -
3 May 2011 51 - - - - -
Cancellation
of share
premium
account (871) 871 - - - -
Cancellation
of capital
redemption
reserve - 19 - - (19) -
Repurchase
and
cancellation
of shares - (261) - - 37 -
Net return on
ordinary
activities
after
taxation - - - - - 133
At 31
December
2011 - 7,168 611 (701) 37 277
-------------- ---------------------- ---------------------- --------------------- ------------------------ ---------------------- ---------------------
S Ordinary
Shares
At 1 January
2011 4,227 (26) 106 (38) 3 35
Gains on
sales of
investments - - 18 - - -
Net increase
in value of
investments - - - 332 - -
Investment
management
fees - - (62) - - -
Dividends
paid - - (74) - - (25)
Tax effect of
capital items - - 12 - - -
Cancellation
of share
premium
account (4,227) 4,227 - - - -
Cancellation
of capital
redemption
reserve - 3 - - (3) -
Repurchase
and
cancellation
of shares - (55) - - 8 -
Net return on
ordinary
activities
after
taxation - - - - - 111
At 31
December
2011 - 4,149 - 294 8 121
-------------- ---------------------- ---------------------- --------------------- ------------------------ ---------------------- ---------------------
14 Net asset value per Ordinary Share
The net asset value per share and the net asset value attributable to the Ordinary Shares at the year end calculated in accordance with the Articles of Association were as follows:
31 December 2011 31 December 2010
Ordinary Shares S Ordinary Shares Ordinary Shares S Ordinary Shares
Net asset Net asset Net asset Net asset Net asset Net asset Net asset Net asset
value
value per value value per value value per value per value
share attributable share attributable share attributable share attributable
p GBP'000 p GBP'000 p GBP'000 p GBP'000
Ordinary
Shares 98.2 8,231 104.1 5,058 95.7 7,964 97.3 4,801
---------- -------------------- ------------------ ----------------- -------------------- ------------------- ----------------- --------------- -----------------
The number of issued shares used in the above calculation is set out in note 12.
Year ended Year ended
31 December 2011 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Shares Shares
15 Reconciliation of revenue
return before finance costs GBP'000 GBP'000 GBP'000 GBP'000
and taxation to net cash
inflow from operating activities
--------------------------------- ---------------------- --------------------- ------------------------ ----------------------
Net return before taxation 499 411 756 208
Gains on investments (546) (350) (799) (278)
Increase in accrued income (65) (47) (3) (12)
Increase/(decrease) in
accruals 49 (6) (8) (8)
Amortisation of fixed
income investment book
cost 2 1 - -
Tax on unfranked income (2) (1) - -
Net cash (outflow)/inflow
from operating activities (63) 8 (54) (90)
--------------------------------- ---------------------- --------------------- ------------------------ ----------------------
Ordinary Shares S Ordinary Shares
16
Analysis
of changes
in net
funds At At At At
31 31
1 January Cash December 1 January Cash December
2011 flows 2011 2011 flows 2011
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cash and
overnight
deposits 890 (491) 399 753 (397) 356
----------- -------------------- -------------------- --------- --------------------- -------------------- ---------
At At At At
31 31
1 January Cash December 1 January Cash December
2010 flows 2010 2010 flows 2010
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cash and
overnight
deposits 756 134 890 1,832 (1,079) 753
----------- -------------------- -------------------- --------- --------------------- -------------------- ---------
Year ended Year ended
31 December 2011 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Shares Shares
17. Capital commitments, contingencies
and GBP'000 GBP'000 GBP'000 GBP'000
financial guarantees
Financial guarantees 244 137 248 140
---------------------------------------- ---------- ------------ ---------- ------------
These financial guarantees represent potential further investment in unlisted securities.
18 Derivatives and other financial instruments
The Company's financial instruments comprise equity and fixed interest investments, cash balances and debtors and creditors that arise directly from its operations, for example, in respect of sales and purchases awaiting settlement, and debtors for accrued income. The company holds financial assets in accordance with its investment policy of investing mainly in a portfolio of VCT qualifying unquoted and AIM quoted securities. The Company may not enter into derivative transactions in the form of forward foreign currency contracts, futures and options without the written permission of the Directors. No derivative transactions were entered into during the period.
The main risks the Company faces from its financial instruments are (i) market price risk, being the risk that the value of investment holdings will fluctuate as a result of changes in market prices caused by factors other than interest rates, (ii) interest rate risk, (iii) liquidity risk and (iv) credit risk. In line with the Company's investment objective, the portfolio comprises only sterling currency securities and therefore has no direct exposure to foreign
currency risk.
The Manager's policies for managing these risks are summarised below and have been applied throughout the period. The numerical disclosures below exclude short-term debtors and creditors which are included in the Balance Sheet at fair value.
Market price risk
The Company's investment portfolio is exposed to market price fluctuations, which are monitored by the manager in pursuance of the investment objective as set out on page 19. Adherence to investment guidelines and to investment and borrowing policies set out in the management agreement mitigates the risk of excessive exposure to any particular type of security or issuer. These powers and guidelines include the requirement to invest in a minimum of 30 companies across a range of industrial and service sectors at varying stages of development, to closely monitor the progress of these companies and to appoint a non executive director to the board of each company. Further information on the investment portfolio (including sector concentration and deal type analysis) is set out in the Analysis of Unlisted and AIM Portfolio, Investment Manager's Review, Summary of Investment Changes, Investment Portfolio Summary and Largest Unlisted and AIM Investments.
Interest rate risk
The interest rate risk profile of financial assets
at the balance sheet date was as follows:
Ordinary Shares
At 31 December 2011 Fixed Floating Non interest
Interest rate bearing
GBP'000 GBP'000 GBP'000
----------------------- ----------------- ----------------- --------------------
Sterling
Listed fixed income 597 - -
Unlisted and AIM/PLUS 4,351 - 2,749
Cash - 399 -
----------------------- ----------------- --------------------
4,948 399 2,749
----------------------- ----------------- ----------------- --------------------
At 31 December 2010 Fixed Floating Non interest
Interest rate bearing
GBP'000 GBP'000 GBP'000
----------------------- ----------------- ----------------- --------------------
Sterling
Listed fixed income - - -
Unlisted and AIM/PLUS 4,397 - 2,559
Cash - 890 -
----------------------- ----------------- --------------------
4,397 890 2,559
----------------------- ----------------- ----------------- --------------------
The listed fixed interest assets have a weighted average life of 0.4 years (2010: N/A) and a weighted average interest rate of 5.2% (2010: N/A).
The unlisted fixed interest assets have a weighted average life of 2.8 years (2010: 2.8 years) and a weighted average interest rate of 10.4% (2010: 8.45%). The non-interest bearing assets represent the equity element of the portfolio. All assets and liabilities of the fund are included in the balance sheet at fair value.
It is the Directors opinion that the carrying amounts of these financial assets represent the maximum credit risk exposure at the balance sheet date.
The interest rate which determines the interest received on cash balances is the bank base rate.
S Ordinary Shares
At 31 December 2011 Fixed Floating Non interest
Interest rate bearing
GBP'000 GBP'000 GBP'000
----------------------- ----------------- ----------------- --------------------
Sterling
Listed Fixed Income 248 - -
Unlisted and AIM/PLUS 2,665 - 1,690
Cash - 356 -
----------------------- ----------------- --------------------
2,913 356 1,690
----------------------- ----------------- ----------------- --------------------
At 31 December 2010 Fixed Floating Non interest
Interest rate bearing
GBP'000 GBP'000 GBP'000
----------------------- ----------------- ----------------- --------------------
Sterling
Listed Fixed Income - - -
Unlisted and AIM/PLUS 2,633 - 1,369
Cash - 753 -
----------------------- ----------------- --------------------
2,633 753 1,369
----------------------- ----------------- ----------------- --------------------
The listed fixed interest assets have a weighted average life of 0.4 years (2010: N/A) and a weighted average
interest rate of 5.2% (2010: N/A).
The unlisted fixed interest assets have a weighted average life of 3.2 years (2010: 3.2 years) and a weighted
average interest rate of 10.4% (2010: 8.2%). The non-interest bearing assets represents the equity element of
the portfolio. All assets and liabilities of the fund are included in the balance sheet at fair value.
It is the Directors opinion that the carrying amounts of these financial assets represent the maximum credit risk
exposure at the balance sheet date.
The interest rate which determines the interest received on cash balances is the bank base rate.
Maturity
profile
The interest rate profile of the Company's financial assets
at the Balance sheet date was as follows:
Ordinary
Shares Within Within Within Within Within More than
1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years Total
At 31
December
2011 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------- -------------- ----------------- ----------------- ----------------- ----------------- ----------------- ------------
Fixed
interest
Listed 597 - - - - - 597
Unlisted 939 452 1,088 1,018 501 353 4,351
1,536 452 1,088 1,018 501 353 4,948
---------- -------------- ----------------- ----------------- ----------------- ----------------- ----------------- ------------
Within "more than 5 years" there is a figure of GBP11,000 (2010 - GBP17,000)
in respect of preference shares which
have no
redemption
date).
Ordinary
Shares Within Within Within Within Within More than
1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years Total
At 31
December
2010 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------ ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ---------------
Fixed
interest
Listed - - - - - - -
Unlisted 857 856 427 1,134 900 223 4,397
857 856 427 1,134 900 223 4,397
------------ ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ---------------
S Ordinary
Shares Within Within Within Within Within More than
1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years Total
At 31
December
2011 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------ ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ---------------
Fixed
interest
Listed 248 - - - - - 248
Unlisted 437 90 553 954 370 261 2,665
685 90 553 954 370 261 2,913
------------ ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ---------------
Within "more than 5 years" there is a figure of GBP1,000 (2010 - GBP1,000)
in respect of preference shares which
have no
redemption
date).
S Ordinary
Shares Within Within Within Within Within More than
1 year 1-2 years 2-3 years 3-4 years 4-5 years 5 years Total
At 31
December
2010 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------ ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ---------------
Fixed
interest
Listed - - - - - - -
Unlisted 403 579 116 540 845 150 2,633
403 579 116 540 845 150 2,633
------------ ----------------- ----------------- ----------------- ----------------- ----------------- ----------------- ---------------
All liabilities are due within one year and, as such, no maturity profile has been provided.
Liquidity risk
Due to their nature, unlisted investments may not be readily realisable and therefore a portfolio of listed assets and cash is held to offset this liquidity risk. Note 8 details the three-tier hierarchy of inputs used as at 31 December 2011 in valuing the Company's investments carried at fair value.
Credit risk and interest rate risk are minimised by acquiring high quality government treasury stocks or other bonds which have a relatively short time to maturity.
The Company, generally, does not hold significant cash balances and any cash held is with reputable banks with high quality external credit ratings.
Credit risk
This is the risk that a counterparty to a financial instrument
will fail to discharge an obligation or commitment that it
has entered into with the Company.
The Company's financial assets exposed to credit
risk amounted to the following:
31 December 2011 31 December 2010
Ordinary S Ordinary Ordinary S Ordinary
Shares Shares Total Shares Shares Total
Investments in fixed interest
instruments 597 248 845 - - -
Investments in unlisted
debt securities 4,351 2,665 7,016 4,397 2,633 7,030
Cash and cash equivalents 399 356 755 890 753 1,643
5,347 3,269 8,616 5,287 3,386 8,673
------------------------------- --------- ------------ ------- ------------------- ------------ -------
Credit risk arising on fixed interest instruments is mitigated by investing in UK Government Stock.
All assets which are traded on a recognised exchange, are held by JP Morgan Chase (JPM), the Company's custodian. Cash balances are held by JPM and Clydesdale. Should the credit quality or the financial position of any of these institutions deteriorate significantly the Manager will move these assets to another financial institution.
The Manager evaluates credit risk on unlisted debt securities and financial commitments and guarantees prior to investment, and as part of the ongoing monitoring of investments. In doing this, it takes into account the extent and quality of any security held. Typically, unlisted debt securities have a fixed charge over the assets of the investee company in order to mitigate the gross credit risk. The Manager receives management accounts from investee companies, and members of the investment management team sit on the boards of investee companies; this enables the close identification, monitoring and management of investment specific credit risk.
There were no significant concentrations of credit risk to counterparties at 31 December 2011 or 31 December 2010.
Price risk sensitivity
The following details the Company's sensitivity to a 10% increase or decrease in the market prices of listed or AIM/PLUS quoted securities, with 10% being the Manager's assessment of a reasonable possible change in market prices.
At 31 December 2011, if market prices of AIM/PLUS quoted securities had been 10% higher or lower and with all other variables held constant, the increase or decrease in net assets attributable to Ordinary Shareholders for the year would have been GBP94,000 (2010: GBP71,000) due to the change on valuation of financial assets at fair value through profit or loss.
At 31 December 2011, if market prices of listed or AIM/PLUS quoted securities had been 10% higher or lower and with all other variables held constant, the increase or decrease in net assets attributable to S Ordinary Shareholders for the year would have been GBP32,000 (2010: GBP16,200) due to the change on valuation of financial assets at fair value through profit or loss.
At 31 December 2011, 82.0% (2010: 78.4%) comprised investments in unquoted companies held at fair value attributable to Ordinary Shareholders. The valuation methods used by the Company include cost and realisable value. Therefore, it is not considered meaningful to provide a sensitivity analysis on the net asset position and total return Therefore, it is not considered meaningful to provide a sensitivity analysis on the net asset position and total return for the year due to the fact any such movements would be immaterial to users of Financial Statements.
At 31 December 2011, 84.6% (2010: 79.9%) comprised investments in unquoted companies held at fair value attributable to S Ordinary Shareholders. The valuation methods used by the Company include cost and realisable value. Therefore, it is not considered meaningful to provide a sensitivity analysis on the net asset position and total return for the year due to the fact any such movements would be immaterial to users of Financial Statements.
Other information
This announcement has been prepared on the same basis as the Annual Report and Financial Statements for the year ended 31 December 2011. The Annual Report and Financial Statements for the year ended 31 December 2011 will be filed with the Registrar of Companies and issued to Shareholders in due course. References to page numbers and notes to the financial statements are references to the Annual Report and Financial Statements for the year ended 31 December 2011.
The financial information contained within this announcement does not constitute the Company's statutory Financial Statements as defined in the Companies Act 2006. The statutory Financial Statements for the year ended 31 December 2010 have been delivered to the Registrar of Companies and contained an audit report which was unqualified.
Copies of this announcement and of the Annual Report and Financial Statements for the year ended 31 December 2011 will be available at the registered office: 149 St Vincent Street, Glasgow, G2 5NW, and on the Company's website at www.mavencp.com/migvct4.
By order of the Board
Maven Capital Partners UK LLP
Secretary
ENDS
Neither the content 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
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