We could not find any results for:
Make sure your spelling is correct or try broadening your search.
Register to chat with like-minded investors on our interactive forums.
| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Mobeus Income & Growth 4 Vct Plc | LSE:MIG4 | London | Ordinary Share | GB00B1FMDH51 | 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% | 68.00 | 66.50 | 69.50 | 68.00 | 68.00 | 68.00 | 451,079 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Trust,ex Ed,religious,charty | -12.69M | -15.17M | -0.1373 | -4.95 | 75.18M |
From Apr 2019 to Apr 2024
TIDMMIG4
RNS Number : 2520A
Mobeus Income & Growth 4 VCT PLC
23 March 2017
Mobeus Income & Growth 4 VCT plc ("MIG4" or the "Company" or the "VCT")
Annual Results Announcement for the year ended 31 December 2016
INVESTMENT OBJECTIVE
Mobeus Income & Growth 4 VCT plc, ("MIG4", the "Company" or the "Fund") is a Venture Capital Trust ("VCT") advised by Mobeus Equity Partners LLP ("Mobeus"), investing primarily in established, unquoted companies.
The Objective of the Company is to provide investors with a regular income stream by way of tax-free dividends and to generate capital growth through portfolio realisations which can be distributed by way of additional tax-free dividends, while continuing at all times to qualify as a VCT.
DIVID POLICY
The Company seeks to pay dividends at least annually out of income and capital as appropriate, and subject to fulfilling certain regulatory requirements.
FINANCIAL HIGHLIGHTS
Annual results for the year ended 31 December 2016
Hot Features
Premium
-- Net Asset Value ("NAV") Total Return per share of 0.6% for
the year.
-- Share Price Total Return per share of 3.3% for the year.
-- Shareholders received an interim dividend of 2.00 pence per
share in September 2016. A second interim dividend of 7.00
pence per share has been declared and was paid on 17 March
2017. This brought dividends paid per share in respect of the
year to 9.00 pence and cumulative dividends paid per share
to date to 80.20 pence.
-- GBP3.14 million was invested during the year into five growth
capital investments.
-- A total of GBP2.10 million cash proceeds was received primarily
from loan stock repayments.
Cumulative total shareholder return per share (NAV basis)*
The longer term trend of performance on this measure is shown in the chart below:-
As at Net assets Net asset Cumulative dividends Cumulative
value (NAV) paid per share total shareholder
per share return per
share (NAV
basis)*
------------------ ----------- ------------- ---------------------- -------------------
(GBPm) (p) (p) (p)
------------------ ----------- ------------- ---------------------- -------------------
31 December 2016 52.76 107.57 73.20 180.77
------------------ ----------- ------------- ---------------------- -------------------
31 December 2015 57.01 117.89 62.20 180.09
------------------ ----------- ------------- ---------------------- -------------------
31 December 2014 50.29 118.21 52.20 170.41
------------------ ----------- ------------- ---------------------- -------------------
31 December 2013 42.12 119.92 34.20 154.12
------------------ ----------- ------------- ---------------------- -------------------
31 December 2012 33.54 117.31 26.70 144.01
------------------ ----------- ------------- ---------------------- -------------------
*Cumulative total shareholder return (NAV basis) is net asset value plus cumulative dividends paid since 1999 to 31 December 2016. The cumulative dividend figure of 73.20 pence per share excludes the payment of the second interim dividend after the year end on 17 March 2017, of 7.00 pence per share. Payment of this dividend has the effect of reducing NAV per share by the equivalent amount.
The net asset value (NAV) per share as at 31 December 2016 was 107.57 pence.
The table above shows the recent past performance of the original funds raised in 1999. The original subscription price was 200p per share before the benefit of income tax relief. Subscription prices from subsequent fundraisings and historic performance data from 2008 are shown in the Investor Performance Appendix on the Company's website www.mig4vct.co.uk, where they can be downloaded by clicking on "table" under "Reviewing the performance of your investment" on the home page.
On 31 July 2006, Mobeus became sole Investment Adviser to the Company. The cumulative NAV total return at this date was 122.51 pence.
CHAIRMAN'S STATEMENT
I am pleased to present the annual results of Mobeus Income & Growth 4 VCT plc for the year ended 31 December 2016.
Overview
2016 represented a year of significant change for your Company. It was the first year of operating after the amendments introduced by the 2015 Finance Act "New VCT Rules".
Because of the magnitude of the changes, shareholders were asked to approve a new investment policy, which they did at last year's annual general meeting in May, 2016.
The Investment Adviser has expanded its investment team to address the new requirements, and has started making investments under the new rules.
Six new investments have already been completed under the New VCT Rules, which is encouraging.
The portfolio held up well despite the uncertainties of the Brexit campaign, which included some unduly pessimistic views advanced by the then government and its allies.
Performance
The NAV total return per share for the year was 0.6 per cent. (2015: 8.2 per cent.) (being the closing NAV plus dividends paid in the year divided by the opening NAV). The small rise in NAV return over the year was primarily due to a positive revenue return. The share price total return was 3.3 per cent. (2015: 11.7 per cent.). These figures are after adding back a total of 11.00 pence of dividends paid in the year. The NAV at 31 December 2016 was 107.57 pence. For details of these calculations, please refer to the Strategic Report in the Annual Report.
For more details on the longer-term performance of your investment in the Company, please consult the Investor Performance Appendix on the Company's website.
Dividends
Your Directors declared a second interim dividend in respect of 2016 of 7.00 pence (2015: final of 9.00 pence) per share, comprising 1.00 pence from income (2015: 1.50 pence) and 6.00 pence from capital (2015: 7.50 pence) of which 6.00 pence was paid from the Company's Special Distributable Reserve. This dividend was paid on 17 March 2017 to shareholders on the Register on 17 February 2017. This brought dividends paid in respect of the year ended 31 December 2016 to 9.00 pence (2015: 11.00 pence) per share and cumulative dividends paid since inception to 80.20 pence (2015: 71.20 pence) per share. In view of the second interim dividend paid in March, the Board is not proposing the payment of a final dividend in respect of 2016.
A chart showing the dividends paid in respect of each of the last five years and cumulative dividends on the same basis is included in the Strategic Report in the Annual Report.
Investment Portfolio
Partly as a consequence of the move to target younger and smaller companies seeking growth capital funding in order to comply with the New VCT Rules, the amount of new investment completed by the Company was lower in 2016 than 2015. These New VCT Rules contain more restrictive investment criteria which, as anticipated in my Statement last year, reduced new investment by the Company in the first half of the year (and across the whole VCT generalist sector), while the Board and the Investment Adviser adapted to the changes.
It was thus pleasing that the last quarter of the year saw a significant pick up in the pace of new investment such that a total of GBP3.14 million (2015: GBP8.48 million) was invested in five (2015: seven) companies during the year plus GBP0.58 million in another company just after the year-end. While this level of investment is lower than in previous years, it compares favourably to levels achieved elsewhere, as Mobeus advised VCTs invested around a sixth of the total invested by the VCT generalist sector in 2016. These investments were made into Redline, MPB, BookingTek, Biosite, Preservica, an existing portfolio company, and finally into Tapas Revolution just after the year-end. The average transaction size of these new investments is less than half that of last year, reflecting the change in focus to younger, smaller companies as required by the New VCT Rules. Further details of all of these transactions are included in the Investment Adviser's Review in the Annual Report.
In addition to these new investments, the Investment Adviser is reporting a growing pipeline of opportunities, from which we expect the rate of new investment to increase. The Board remains of the view that the changes in the VCT legislation clearly restrict the universe of companies that the Company can invest in, but has been encouraged by the numbers and quality of the opportunities identified by the Investment Adviser so far. The Board believes that such earlier stage investments will carry higher risk alongside potentially higher, but more variable, capital returns. It also believes that loan stock income will represent a lower proportion of total returns from such investments. Transactions to date have sought to mitigate these factors by use of the capital structure applied to that investment.
Shareholders should note that, at the year-end but adjusted for the inclusion of Tapas, 88.1% of the value of the investment portfolio (excluding companies preparing to trade) is still held in investments made under the previous MBO-focused strategy. Overall, performance of this principal portion of the portfolio remained solid, and should continue to yield annual income returns to shareholders, supplemented by capital returns as they are realised over time. Net proceeds totalling GBP2.10 million were received during the year under review. Of this total, GBP0.58 million was received in the form of realisation proceeds, of which GBP0.38 million was deferred consideration arising from the previous year's realisations of Focus and Westway. The balance of net proceeds of GBP1.52 million comprised loan repayments from companies held within the portfolio. Unless a compelling case for an exit opportunity is presented, the Board and the Investment Adviser would prefer to develop this portfolio to further maturity.
During the year the value of the opening portfolio increased by GBP0.38 million of realised gains (net of transaction costs) and fell by GBP0.38 million of net unrealised falls in valuations. On a like for like basis, the value of the portfolio was therefore maintained over the year. The portfolio under management at the year-end was valued at GBP38.93 million (2015: GBP38.72 million) representing 101.5 per cent. of cost.
Full details of all of these transactions and of the new investment following the year end are included in the Investment Review.
Industry and regulatory developments
HMRC published its guidance on the New VCT Rules in May 2016 which has provided further information on the new requirements at a detailed level. There remain several areas where further clarity is still required and the VCT, the Investment Adviser and the VCT industry as a whole, are continuing to work constructively with Government departments, through its industry bodies, to develop an improved practical approach. Notwithstanding the EU Referendum result, the Board is working on the assumption that there will be no further changes to the existing VCT legislation in the near future.
A summary of the current VCT regulations is included in the Annual Report.
Fundraising and liquidity
The Board continues to hold GBP7.51 million in a selection of money market funds with AAA credit ratings as at the year-end. The balance of the cash and current asset investments of GBP5.66 million is held in deposit accounts in a number of well-known financial institutions across a range of maturities. Alternative ways of prudently investing cash continue to be sought, although the risk of a loss of capital remains the overriding consideration. In addition, there is GBP8.33 million invested in companies preparing to trade at the year-end.
The Board will consider additional fundraising in the future in line with its liquidity and new investment requirements, together with an assessment of the effects of possible future legislative changes.
Audit tender
New legislation has been introduced in the UK on audit firm rotation, resulting from the new European Audit Regulation Directive, making it mandatory for listed companies to undergo a tender process for the audit of their company at least every ten years. An audit firm can, however, be appointed for up to twenty years provided a public tender process has been carried out after ten years. The Company therefore held an audit tender process over the summer. The Board, on the recommendation of the Audit Committee, has decided to recommend the reappointment of BDO LLP as the Company's external auditor. For further information on the audit tender, please see the Audit Committee section of the Corporate Governance Statement in the Annual Report.
Share buybacks
During the year ended 31 December 2016, the Company bought back 0.5 per cent. of the issued share capital of the Company which was subsequently cancelled. Further details of the purchases are included in the Directors' Report in the Annual Report.
Shareholder Communications
The annual shareholder event was held on Tuesday 24 January 2017 at the Royal Institute of British Architects in central London. This annual event included presentations on the Mobeus advised VCTs' investment activity and performance including presentations from investee companies. There were separate day-time and evening sessions, and feedback from those who attended indicated that they found it informative and worthwhile.
Annual General Meeting
The Annual General Meeting of the Company will be held at 12 noon on Monday, 8 May 2017 at a new venue, The Clubhouse, 8 St James's Square, London SW1Y 4JU. Both the Board and the Investment Adviser look forward to welcoming shareholders to the meeting which will include a presentation from the Investment Adviser on the investment portfolio and provide an opportunity to ask questions of the Board and the Investment Adviser. The Notice of the meeting is included in the Annual Report and an explanation of the resolutions to be proposed can also be found in the Directors' Report in the Annual Report.
Future prospects
In the context of a global economy that is facing increased uncertainty following the UK's Referendum vote and the US Presidential Election, the outlook for the UK economy in 2017 remains somewhat unclear, although not as doom laden as some forecasts have predicted. This will probably continue as the EU exit negotiations are unlikely to be completed rapidly. In this environment, we will continue our measured and cautious approach to investment appraisal and with our active engagement with existing portfolio companies.
The portfolio has a solid foundation of investments made under the previous MBO strategy, the majority of which are mature and profitable companies providing consistent income returns. Over the coming years, this portfolio mix will change towards younger growth capital companies. Your Board remains confident that, with the Investment Adviser's expanded management team, interesting investment opportunities will continue to be identified and developed. Notwithstanding the global political and economic uncertainties mentioned above, the Board and the Investment Adviser remain optimistic regarding the future prospects of the Company.
Finally, I would like to express my thanks to all shareholders for their continuing support of the Company.
Christopher Moore Chairman
22 March 2017
Investment Review
Portfolio Review
This has been a year of continued progress within the portfolio. The exceptional level of disposals in 2014 and 2015 has reduced the age of the remaining portfolio such that 57 % by value (44 % by number) of the current portfolio comprises investments made since the start of 2014. The latter half of the year has seen investment in five (plus one just after the year-end) new growth capital opportunities, which represent 12.0% of the portfolio. Many of the MBO portfolio companies are generating cash, have made repayments of their loan stock and are trading well.
Having experienced an unprecedented number of profitable realisations in 2014 and 2015, the Investment Adviser does not anticipate this level to be repeated in the near to medium term. Shareholders will note that the year-end valuation of the portfolio is only just above its cost. As the portfolio now has a younger profile, time is required for these more recent investments to grow in value. Unless a compelling offer is made for one of our investments, we plan to hold those that are performing, that are generating income, and that show potential to grow their value further.
Investments by market sector at valuation
Investments remain spread across a number of sectors, primarily in support services, software and computer services and general retailers.
Impact of Changes in VCT Rules
The 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. The Investment Adviser has responded to this by adding experienced growth capital investment resource to its existing team. Along with other investment advisers in the industry, Mobeus has focused on gaining familiarity with the practical implications of the rules on the types of investment opportunities it can now consider for VCT investment. That process is continuing, including discussions with HMRC in response to their draft Guidance to the legislation. The Investment Adviser is also gaining additional practical experience from assessing prospective opportunities at a detailed level and from continuing to seek HMRC Advance Assurance in respect of each new investment proposal.
There has been an inevitable initial slowdown in new deal activity, resulting from both the more restrictive criteria for VCT investment under the new VCT rules and delays at HMRC in processing applications for Advance Assurance. Independent research shows that as at 31 December 2016 the amount of completed new investment across the generalist VCT Industry for 2016 had fallen by 30% and 49% compared to the same periods in 2015 and 2014 respectively.
Impact of Brexit
It is too early to comment on the eventual impact of the UK leaving the EU upon the portfolio, whatever form that departure takes. 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
Against this background, we are therefore pleased to have made six new investments under the New VCT Rules. A total of GBP3.14 million (including GBP0.84 million via a company preparing to trade) was invested during the year under review. This comprised new investments into Redline, MPB, BookingTek, Biosite and Preservica, an existing portfolio company. Just after the year-end, GBP0.58 million was invested into Tapas Revolution. Further details are set out below.
Principal new investments in the year
Company Business Date of Investment Amount of
new investment
(GBPm)
--------------------- ------------------------------------ -------------------- -------------------
Provision of security products February
Redline and services 2016 0.84*
--------------------- ------------------------------------ -------------------- -------------------
Redline is a market leader in the provision of security consultancy
and training services to airlines, governments, airports and global
distribution companies. Redline currently operates predominantly
in the aviation security market and is at the forefront of counter-terrorism
training and services. The investment is being applied to enable
the Company to grow in its core aviation market and in other sectors.
The company's latest accounts for the year ended 31 March 2016 show
turnover of GBP5.01 million and underlying profit before interest,
tax and amortisation of goodwill of GBP1.04 million.
* GBP1.13 million previously held in Pound FM Consultants Limited,
a company preparing to trade, was used for this investment. This
resulted in a net repayment of GBP0.29 million. Pound FM Consultants
Limited has subsequently changed its name to Redline Worldwide Limited.
---------------------------------------------------------------------------------------------------
Online marketplace for used
MPB Group photo and video equipment June 2016 0.47
--------------------- ------------------------------------ -------------------- -------------------
MPB is Europe's leading online marketplace for used photo and video
equipment. Based in Brighton, their 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 2016 show turnover of GBP8.37 million
and profit before interest, tax and amortisation of goodwill of
GBP0.001 million.
---------------------------------------------------------------------------------------------------
Direct booking software
BookingTek for hotels October 2016 0.51
--------------------- ------------------------------------ -------------------- -------------------
Based in London, BookingTek has developed software that enables
hotels to reduce their reliance on third-party booking systems by
means of 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.
---------------------------------------------------------------------------------------------------
November
Biosite Workforce management 2016 0.64
--------------------- ------------------------------------ -------------------- ----------------
Based in the Midlands, Pattern Analytics (Biosite) is a fast growing
provider of biometric access control and software-based workforce
management solutions for the construction sector. The investment
will support the expansion of the team to facilitate the development
of new site-management tools to enable managers to oversee all aspects
of a construction project. The company's latest accounts for the
year ended 31 July 2016 show turnover of GBP4.69 million and profit
before interest, tax and amortisation of goodwill of GBP0.49 million.
---------------------------------------------------------------------------------------------------
Further investment into existing portfolio companies in the year
Company Business Date of investment Amount of
new investment
(GBPm)
------------ ----------------------------- -------------------- ----------------
Sellers of proprietary December
Preservica digital archiving software 2016 0.68
------------ ----------------------------- -------------------- ----------------
Based in Oxfordshire, Preservica has developed the world's leading
software for the long-term preservation of digital records, ensuring
that long-term digital content is accessible, irrespective of changes
in future technology. Previously a subsidiary of Tessella it was
demerged prior to the sale of Tessella in December 2015. The additional
investment was made to provide development funding to the company.
The company's latest accounts for the year ended 31 March 2016 show
turnover of GBP1.78 million and profit before interest, tax and
amortisation of goodwill of GBP0.16 million.
-----------------------------------------------------------------------------------
New investment post year-end
Company Business Date of investment Amount of
new investment
(GBPm)
--------------------- -------------- ----------------------- -------------------
Tapa Revolution Restaurant January 2017 0.58
--------------------- -------------- ----------------------- -------------------
Based in London, Ibericos Etc. Limited (which trades as Tapas Revolution)
is a leading Spanish restaurant chain in the casual dining sector
focusing on shopping centres sites with high footfall. Having opened
its first restaurant in Shepherd's Bush Westfield, the business
has since opened a further four restaurants. The investment provided
growth capital to a high-calibre team with significant restaurant
roll-out experience who have spent the past five years building
and refining their offer and are now well placed to capitalise on
a strong pipeline of new sites. The company's latest accounts for
the year ended 25 October 2015 show a turnover of GBP2.37 million
and loss before interest, tax and amortisation of goodwill of GBP0.16
million.
-----------------------------------------------------------------------------------
Realisations
There were no full realisations during the year ended 31 December 2016, although the Company received cash proceeds of GBP2.10 million, of which GBP1.52 million was in the form of loan stock repayments (detailed below), deferred consideration of GBP0.38 million and other receipts of GBP0.20 million.
Loan stock repayments
Loan stock repayments totalled GBP1.52 million for the year. These are summarised below:-
Company Business Month Amount
(GBP000's)
------------- --------------------------------- ---------- ------------
Logistics, storage and removals
Ward Thomas business January 837
------------- --------------------------------- ---------- ------------
Barham Company preparing to trade December 454
------------- --------------------------------- ---------- ------------
Pound FM Company preparing to trade February 111
------------- --------------------------------- ---------- ------------
Vehicle cleaning and valeting
Motorclean services February 64
------------- --------------------------------- ---------- ------------
Jablite Expanded polystyrene products April 57
------------- --------------------------------- ---------- ------------
Total 1,523
------------------------------------------------------------ ------------
Investment Portfolio Summary
at 31 December 2016
Total Total Valuation Total Valuation % of equity % of
Cost at at 31 Dec at 31 Dec held Portfolio
31 Dec 2016 2015 2016 by value
GBP GBP GBP
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Mobeus Equity Partners
LLP
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Virgin Wines Holding
Company Limited
Online wine retailer 1,930,813 2,784,729 2,685,675 9.7% 6.9%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Tovey Management
Limited (trading
as Access IS)
Provider of data
capture and scanning
hardware 2,469,013 2,469,013 2,601,197 10.1% 6.7%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Entanet Holdings
Limited
Wholesale communications
provider 2,167,662 3,338,043 2,254,135 13.1% 5.8%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Media Business Insight
Holdings Limited
A publishing and
events business
focused on the creative
production industries 2,722,760 2,282,607 2,218,152 15.7% 5.7%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
ASL Technology Holdings
Limited
Printer and photocopier
services 1,933,591 2,234,937 2,082,980 9.5% 5.4%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Manufacturing Services
Investment Limited
Company seeking
to carry on a business
in the manufacturing
sector 2,016,900 2,016,900 2,016,900 11.4% 5.2%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Fullfield Limited
(trading as Motorclean)
Vehicle cleaning
and valet services 1,131,444 1,379,974 1,459,525 9.8% 3.7%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Gro-Group Holdings
Limited
Baby sleep products 1,577,977 1,138,860 1,361,293 10.7% 3.5%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Turner Topco Limited
(trading as ATG
Media)
Publisher and online
auction platform
operator 1,529,075 828,610 1,330,326 3.7% 3.4%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
CGI Creative Graphics
International Limited
Vinyl graphics to
global automotive,
recreation vehicle
and aerospace markets 1,449,746 1,179,872 1,311,572 6.3% 3.4%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Veritek Global Holdings
Limited
Maintenance of imaging
equipment 1,620,086 1,659,063 1,283,041 10.3% 3.3%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Tharstern Group
Limited
MIS & Commercial
print software solutions 1,091,886 1,518,767 1,217,396 12.2% 3.1%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
EOTH Limited (trading
as Equip Outdoor
Technologies)
Distributor of branded
outdoor equipment
and clothing 951,471 1,008,235 1,197,945 1.7% 3.1%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Vian Marketing Limited
(trading as Tushingham
Sails) Design, manufacture
and sale of stand-up
paddleboards and
windsurfing sails 899,074 899,074 1,188,439 7.1% 3.1%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Backhouse Management
Limited
Company seeking
to carry on a business
in the motor sector 1,134,000 1,134,000 1,134,000 11.3% 2.9%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Chatfield Services
Limited
Company seeking
to carry on a business
in the retail sector 1,134,000 1,134,000 1,134,000 11.3% 2.9%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Creasy Marketing
Services Limited
Company seeking
to carry on a business
in the textile sector 1,134,000 1,134,000 1,134,000 11.3% 2.9%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
McGrigor Management
Limited
Company seeking
to carry on a business
in the pharmaceutical
sector 1,134,000 1,134,000 1,134,000 11.3% 2.9%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Hollydale Management
Limited
Company seeking
to carry on a business
in the food sector 1,095,500 1,095,500 1,095,500 11.0% 2.8%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
RDL Corporation
Limited
Recruitment consultants
for the pharmaceutical,
business intelligence
and IT industries 1,000,000 622,056 926,025 9.1% 2.5%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
The Plastic Surgeon
Holdings Limited
Snagging and finishing
of domestic and
commercial properties 458,935 840,837 902,329 11.4% 2.3%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Bourn Bioscience
Limited
Management of In-vitro
fertilisation clinics 1,132,521 895,428 864,082 7.7% 2.2%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Redline Worldwide
Limited (formerly
Pound FM Consultants
Limited)(1)
Provider of security
services to the
aviation industry
and other sectors 838,377 1,134,000 838,377 6.7% 2.2%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Master Removers
Group Limited (trading
as Anthony Ward
Thomas, Bishopsgate
and Aussie Man &
Van)
A specialist logistics,
storage and removals
business 511,855 1,485,897 734,387 4.3% 1.9%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Barham Consulting
Limited
Company seeking
to carry on a business
in the catering
sector 861,840 1,134,000 680,400 11.3% 1.7%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Preservica Limited(2)
Seller of proprietary
digital archiving
software 679,617 - 679,617 4.6% 1.7%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Pattern Analytics
Limited (trading
as Biosite)
Workforce management
and security services
for the construction
industry 640,171 - 640,171 4.8% 1.6%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Jablite Holdings
Limited (formerly
Duncary 16 Limited)
Manufacturer of
expanded polystyrene
products 376,083 1,097,406 606,998 9.1% 1.6%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
BookingTek Limited
Software for hotel
groups 512,137 - 512,137 3.4% 1.3%
------------------------------------ ------------- ---------------- ---------------- ------------ -----------
MPB Group Limited
Online marketplace
for used photographic
equipment 471,216 - 471,216 5.3% 1.2% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Omega Diagnostics Group plc(3) In-vitro diagnostics for food intolerance, auto-immune diseases and infectious diseases 200,028 258,347 291,682 1.5% 0.7% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Blaze Signs Holdings Limited Manufacturer and installer of signs 190,631 356,486 280,944 5.7% 0.7% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Vectair Holdings Limited Designer and distributor of washroom products 24,732 123,079 183,729 2.1% 0.5% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Racoon International Holdings Limited Supplier of hair extensions, hair care products and training 484,347 77,542 38,771 10.5% 0.1% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Lightworks Software Limited Provider of software for CAD and CAM vendors 9,329 24,858 34,926 4.2% 0.1% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- BG Training Limited City-based provider of specialist technical training 14,167 14,167 14,167 0.0% 0.0% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Newquay Helicopters (2013) Limited (in creditors' voluntary liquidation) Helicopter service operator 12,342 21,250 - 2.5% 0.0% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- CB Imports Group Limited (trading as Country Baskets) Importer and distributor of artificial flowers, floral sundries and home décor products 175,000 - - 5.8% 0.0% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Watchgate Limited Holding company 1,000 - - 33.3% 0.0% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Total 37,717,326 38,455,537 38,540,034 - 99.0% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Former Elderstreet Private Equity Portfolio ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Cashfac Limited Provider of virtual banking application software solutions to corporate customers 260,101 187,108 288,932 2.9% 0.7% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Sparesfinder Limited Supplier of industrial spare parts online 250,854 46,977 64,067 2.0% 0.2% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Sift Group Limited Developer of business-to-business internet communities 135,391 27,048 33,401 1.3% 0.1% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Total 646,346 261,133 386,400 - 1.0% ------------------------------------ ------------- ---------------- ---------------- ------------ ----------- Investment Adviser's Total 38,363,672 38,716,670 38,926,434 - 100.0% ------------------------------------ ------------- ---------------- ---------------- ------------ -----------
Notes
1 GBP1,134,000 invested in Pound FM Consultants Limited, a company preparing to trade, was used for the investment into Redline Assured Security Limited, which resulted in a net repayment of GBP295,623. Pound FM subsequently changed its name to Redline Worldwide Limited..
2 A further GBP679,617 was invested into Preservica Limited, adding to the Company's existing shareholding that was received as part of the disposal of Tessella Holdings Limited in December 2015. 3 Quoted on AIM.
STATEMENT OF DIRECTORS' RESPONSIBILITIES
The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare Financial Statements for each financial year and the Directors have elected to prepare the Financial Statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the Directors must not approve the Financial Statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss for the Company for that period.
In preparing these financial statements, the Directors are required to:
-- select suitable accounting policies and then apply them consistently; -- make judgements and accounting estimates that are reasonable and prudent;
-- state whether the Financial Statements have been prepared in accordance with the United Kingdom
accounting standards, subject to any material departures disclosed and explained in the Financial Statements;
-- prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that
the Company will continue in business;
-- prepare a Strategic Report, a Directors' Report and Directors' Remuneration Report which comply with the
requirements of the Companies Act 2006.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the Financial Statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.
Website publication
The Directors are responsible for ensuring the Annual Report and the Financial Statements are made available on a website. Financial Statements are published on the Company's website in accordance with legislation in the United Kingdom governing the preparation and dissemination of Financial Statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Company's website is the responsibility of the Directors. The Directors' responsibility also extends to the ongoing integrity of the Financial Statements contained therein.
Directors' responsibilities pursuant to Disclosure and Transparency Rule 4 of the UK Listing Authority
The Directors confirm to the best of their knowledge that:
(a) The Financial Statements, which have been prepared in accordance with UK Generally Accepted Accounting Practice, gave a true and fair view of the assets, liabilities, financial position and the profit of the Company.
(b) The Annual Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces.
Having taken advice from the Audit Committee, the Board considers the Annual Report and Financial Statements, taken as a whole, as fair, balanced and understandable and that it provides the information necessary for shareholders to assess the Company's performance, business model and strategy.
Neither the Company nor the Directors accept any liability to any person in relation to the Annual Report except to the extent that such liability could arise under English law. Accordingly, any liability to a person who has demonstrated reliance on any untrue or misleading statement or omission shall be determined in accordance with section 90A and schedule 10A of the Financial Services and Markets Act 2000.
The names and functions of the Directors are stated in the Annual Report.
For and on behalf of the Board:
Christopher Moore
Chairman
22 March 2017
FINANCIAL STATEMENTS
Income Statement
for the year ended 31 December 2016
Year ended 31 December 2016 Year ended 31
December 2015
Notes Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
---------------------- ------- ------------ ------------ --------------- ----------- ----------- --------------
Unrealised
(losses)/gains
on investments 8 - (377,677) (377,677) - 1,094,287 1,094,287
Realised gains on
investments 8 - 381,087 381,087 - 3,302,320 3,302,320
Income 3 2,019,579 - 2,019,579 2,202,056 - 2,202,056
Investment Adviser's
fees 4a (304,628) (913,884) (1,218,512) (303,725) (911,176) (1,214,901)
Other expenses 4c (370,899) - (370,899) (402,156) - (402,156)
---------------------- ------- ------------ ------------ --------------- ----------- ----------- --------------
Profit/(loss) on
ordinary
activities
before taxation 1,344,052 (910,474) 433,578 1,496,175 3,485,431 4,981,606
Taxation on
profit/(loss)
on ordinary
activities 5 (212,864) 182,776 (30,088) (184,209) 184,209 -
---------------------- ------- ------------ ------------ --------------- ----------- ----------- --------------
Profit/(loss) for the
year
and total
comprehensive income 1,131,188 (727,698) 403,490 1,311,966 3,669,640 4,981,606
---------------------- ------- ------------ ------------ --------------- ----------- ----------- --------------
Basic and diluted
earnings
per ordinary share 7 2.32p (1.49)p 0.83p 2.74p 7.67p 10.41p
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 Financial Reporting Standards ("FRS"). In order to better reflect the activities of a VCT and in accordance with the Statement of Recommended Practice ("SORP") issued in November 2014 (updated in January 2017) 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 year.
Balance Sheet
As at 31 December 2016
31 December 2016 31 December 2015
Notes GBP GBP
Fixed assets
Investments at fair value 8 38,926,434 38,716,670
Current assets
Debtors and prepayments 860,011 561,950
Current asset investments 9,511,810 14,619,207
Cash at bank 3,662,074 3,386,635
-------------------------------------- ------- ---------------- ----------------
14,033,895 18,567,792
Creditors: amounts falling due within
one year (205,173) (276,680)
-------------------------------------- ------- ---------------- ----------------
Net current assets 13,828,722 18,291,112
-------------------------------------- ------- ---------------- ----------------
Net assets 52,755,156 57,007,782
-------------------------------------- ------- ---------------- ----------------
Capital and reserves
Called up share capital 490,430 483,562
Share premium reserve 13,540,891 12,629,944
Capital redemption reserve 9,342 6,827
Revaluation reserve 1,152,007 1,545,364
Special distributable reserve 31,646,338 32,622,021
Realised capital reserve 4,702,557 8,422,420
Revenue reserve 1,213,591 1,297,644
-------------------------------------- ------- ---------------- ----------------
Equity shareholders' funds 52,755,156 57,007,782
-------------------------------------- ------- ---------------- ----------------
Basic and diluted net asset value
per ordinary share 107.57p 117.89p
Statement of changes in equity
for the year ended 31 December 2016
Non-distributable reserves Distributable reserves
Called
up Share Capital Special Realised Revenue
share premium redemption Revaluation distributable capital reserve
Notes capital reserve reserve reserve reserve reserve Total
(note (note (note
a) b) b)
GBP GBP GBP GBP GBP GBP GBP GBP
At 1 January
2016 483,562 12,629,944 6,827 1,545,364 32,622,021 8,422,420 1,297,644 57,007,782
Comprehensive
income for the
year
(Loss)/profit
for the year - - - (377,677) - (350,021) 1,131,188 403,490
---------------- ---- -------------- ----------- ----------- ----------- ------------- ------------- ------------- -------------
Total
comprehensive
income for the
year - - - (377,677) - (350,021) 1,131,188 403,490
---------------- ---- -------------- ----------- ----------- ----------- ------------- ------------- ------------- -------------
Contributions
by and
distributions
to owners
Dividends
re-invested
into new shares 9,383 910,947 - - - - - 920,330
Shares bought
back (2,515) - 2,515 - (244,575) - - (244,575)
Dividends paid 6 - - - - - (4,116,630) (1,215,241) (5,331,871)
---------------- ---- -------------- ----------- ----------- ----------- ------------- ------------- ------------- -------------
Total
contributions
by and
distributions
to owners 6,868 910,947 2,515 - (244,575) (4,116,630) (1,215,241) (4,656,116)
---------------- ---- -------------- ----------- ----------- ----------- ------------- ------------- ------------- -------------
Other movements
Realised losses
transferred
to special
reserve
(note a below) - - - - (731,108) 731,108 - -
Realisation
of previously
unrealised
appreciation - - - (15,680) - 15,680 - -
---------------- ---- -------------- ----------- ----------- ----------- ------------- ------------- ------------- -------------
Total other
movements - - - (15,680) (731,108) 746,788 - -
---------------- ---- -------------- ----------- ----------- ----------- ------------- ------------- ------------- -------------
At 31 December
2016 490,430 13,540,891 9,342 1,152,007 31,646,338 4,702,557 1,213,591 52,755,156
---------------- ---- -------------- ----------- ----------- ----------- ------------- ------------- ------------- -------------
Notes
a) The Special distributable reserve also provides the Company with
a reserve to absorb any existing and future realised losses and,
when considered by the Board to be in the interests of shareholders,
to fund share buybacks and for other corporate purposes. All of this
reserve originates from funds raised prior to 6 April 2014. The transfer
of GBP731,108 to the special reserve from the realised capital reserve
above is the total of realised losses incurred by the Company in
the year.
b) The realised capital reserve and the revenue reserve together
comprise the Profit and Loss Account of the Company.
Statement of changes in equity
for the year ended 31 December 2015
Non-distributable reserves Distributable reserves
Called Share Capital Special Realised Revenue
up
share premium redemption Revaluation distributable capital reserve
capital reserve reserve reserve reserve reserve Total
GBP GBP GBP GBP GBP GBP GBP GBP
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
At 1 January
2015 425,434 5,985,042 5,143 1,214,933 33,748,039 7,968,451 943,995 50,291,037
Comprehensive
income for the
year
Profit for the
year - - - 1,094,287 - 2,575,353 1,311,966 4,981,606
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
Total
comprehensive
income for
the
year - - - 1,094,287 - 2,575,353 1,311,966 4,981,606
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
Contributions
by and
distributions
to owners
Shares issued
via Offer for
Subscription 51,679 5,841,843 - - (26,070) - - 5,867,452
Dividends
re-invested
into new
shares 8,133 803,059 - - - - - 811,192
Shares bought
back (1,684) - 1,684 - (168,734) - - (168,734)
Dividends paid - - - - - (3,816,454) (958,317) (4,774,771)
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
Total
contributions
by and
distributions
to owners 58,128 6,644,902 1,684 - (194,804) (3,816,454) (958,317) 1,735,139
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
Other
movements
Realised
losses
transferred
to
special
reserve - - - - (931,214) 931,214 - -
Realisation of
previously
unrealised
appreciation - - - (763,856) - 763,856 - -
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
Total other
movements - - - (763,856) (931,214) 1,695,070 - -
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
At 31 December
2015 483,562 12,629,944 6,827 1,545,364 32,622,021 8,422,420 1,297,644 57,007,782
-------------- ------- ---------- ---------- ----------- ------------- ------------ ---------- -----------
The composition of each of these reserves is explained below:
Called up share capital - The nominal value of shares originally
issued, increased for subsequent share issues either via an Offer
for Subscription or Dividend investment scheme, or reduced due to
shares bought back by the Company.
Share premium reserve - This reserve contains the excess of gross
proceeds less issue costs over the nominal value of shares allotted
under recent Offers for Subscription and the Company's Dividend Investment
scheme.
Capital redemption reserve - The nominal value of shares bought back
and cancelled is held in this reserve, so that the company's capital
is maintained.
Revaluation reserve - Increases and decreases in the valuation of
investments held at the year-end are accounted for in this reserve,
except to the extent that the diminution is deemed permanent.
In accordance with stating all investments at fair value through
profit and loss (as recorded in note 8), all such movements through
both revaluation and realised capital reserves are shown within the
Income Statement for the year.
Special distributable reserve - The cost of share buybacks is charged
to this reserve. In addition, any realised losses on the sale or
impairment of investments, and 75% of the Investment Adviser's fee
expense, and the related tax effect, are transferred from the Profit
and Loss Account reserve to this reserve. Capital dividends may also
be paid from this reserve.
Realised capital reserve - The following are accounted for in this
reserve:
* Gains and losses on realisation of investments;
* Permanent diminution in value of investments;
* Transaction costs incurred in the acquisition of
investments; and
* 75% of the Investment Adviser's fee expense and 100%
of any performance incentive fee payable, together
with the related tax effect to this reserve in
accordance with the policies;
* Capital dividends paid.
Revenue reserve - Income and expenses that are revenue in nature
are accounted for in this reserve together with the related tax effect,
as well as dividends paid that are classified as revenue in nature.
Statement of cash flows
For the year ended 31 December 2016
Year ended 31 Year ended 31
Notes December 2016 December 2015
GBP GBP
------------------------ ---------- ------------------------ ------------------------
Cash flows from
operating activities
Profit for the
financial year 403,490 4,981,606
Adjustments for:
Net unrealised
losses/(gains)
on investments 377,677 (1,094,287)
Net gains on
realisations of
investments (381,087) (3,302,320)
Tax charge for the
current year 30,088 -
Increase in debtors (22,813) (68,758)
(Decrease)/increase in
creditors (102,175) 8,948
------------------------ ---------- ------------------------ ------------------------
Net cash inflow from
operating
activities 305,180 525,189
Cash flows from
investing activities
Sale of investments 8 2,402,008 7,239,803
Purchase of investments 8 (2,883,610) (16,809,665)
Decrease in bank
deposits with
a maturity over three
months 85,130 453,120
------------------------ ---------- ------------------------ ------------------------
Net cash outflow from
investing
activities (396,472) (9,116,742)
Cash flows from
financing activities
Share issued as part of
Offer
for Subscription - 5,867,452
Equity dividends paid 6 (4,411,541) (3,963,579)
Purchase of own shares (243,995) (168,734)
------------------------ ---------- ------------------------ ------------------------
Net cash
(outflow)/inflow from
financing activities (4,655,536) 1,735,139
------------------------ ---------- ------------------------ ------------------------
Net decrease in cash and
cash
equivalents (4,746,828) (6,856,414)
Cash and cash
equivalents at
start of year 15,920,712 22,777,126
------------------------ ---------- ------------------------ ------------------------
Cash and cash
equivalents at
end of year 11,173,884 15,920,712
Cash and cash
equivalents comprise:
Cash at bank and in
hand 3,662,074 3,386,635
Cash equivalents 7,511,810 12,534,077
NOTES TO THE ACCOUNTS
for the year ended 31 December 2016
1 Company Information
Mobeus Income and Growth 4 VCT plc is a public limited company incorporated in England, registration number 03707697. The registered office is 30 Haymarket, London, SW1Y 4EX.
2 Basis of preparation
A summary of the principal accounting policies, all of which have been applied consistently throughout the year are set out next to the related disclosure throughout the Notes to the Financial Statements. All accounting policies are included within an outlined box at the top of each relevant note.
These Financial Statements have been prepared in accordance with applicable United Kingdom accounting standards, including Financial Reporting Standard 102 ("FRS102"), 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 (updated in January 2017). The company has a number of financial instruments which are disclosed under FRS102 s11/12 as shown in note 15 of the Annual Report.
Comparatives
The comparatives to these Financial Statements are those disclosed in last 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 no effect on net assets.
3 Income
Dividends receivable on quoted equity shares are brought into
account on the ex-dividend date. Dividends receivable on unquoted
equity shares are brought into account when the Company's
right to receive payment is established and there is no reasonable
doubt that payment will be received.
Interest income on loan stock is accrued on a daily basis.
Provision is made against this income where recovery is doubtful
or where it will not be received in the foreseeable future.
Where the loan stocks only require interest or a redemption
premium to be paid on redemption, the interest and redemption
premium is recognised as income or capital as appropriate
once redemption is reasonably certain.
When a redemption premium is designed to protect the value
of the instrument holder's investment rather than reflect
a commercial rate of revenue return, the redemption premium
is recognised as capital. The treatment of redemption premiums
is analysed to consider if they are revenue or capital in
nature on a company by company basis. Accordingly, based on
this assessment, the redemption premium recognised in the
year ended 31 December 2016 has been classified as capital
and has been included within gains on investments.
--------------------------------------------------------------------
2016 2015
GBP GBP
--------------------------------------------------- --------- ---------
Income from bank deposits 48,157 78,334
--------------------------------------------------- --------- ---------
Income from investments
- from equities 106,043 61,752
- from overseas based OEICs 47,986 30,470
- from loan stock 1,817,393 2,031,331
- from interest on preference share dividend
arrears - 169
--------------------------------------------------- --------- ---------
1,971,422 2,123,722
--------------------------------------------------- --------- ---------
Total income 2,019,579 2,202,056
--------------------------------------------------- --------- ---------
Total income comprises
Dividends 154,029 92,222
Interest 1,865,550 2,109,834
--------------------------------------------------- --------- ---------
2,019,579 2,202,056
Total loan stock interest due but not recognised
in the year was GBP446,862 (2015: GBP184,887).
4 Investment Adviser's fees and other expenses
All fees and expenses are accounted for on an accruals basis.
--------------------------------------------------------------
a) Investment Adviser's fees
25% of the Investment Adviser's fees are charged to the revenue
column of the Income Statement, while 75% is charged against
the capital column of the Income Statement. This is in line
with the Board's expected long-term split of returns from
the investment portfolio of the Company.
100% of any performance incentive fee payable for the year
is charged against the capital column of the Income Statement,
as it is based upon the achievement of capital growth.
----------------------------------------------------------------
Revenue Capital Total Revenue Capital Total
2016 2016 2016 2015 2015 2015
GBP GBP GBP GBP GBP GBP
Mobeus Equity Partners LLP 304,628 913,884 1,218,512 303,725 911,176 1,214,901
======== ======== ========== ======== ======== ==========
Under the terms of a revised investment management agreement dated 12 November 2010, Mobeus Equity Partners LLP ("Mobeus LLP") (formerly Matrix Private Equity Partners LLP ("MPEP") provides investment advisory, administrative and company secretarial services to the Company, for a fee of 2% per annum of closing net assets, calculated on a quarterly basis by reference to the net assets at the end of the preceding quarter, plus a fixed fee of GBP115,440 per annum, the latter being subject to indexation, if applicable. In 2013, Mobeus agreed to waive such further increases due to indexation, until otherwise agreed with the Board.
The Investment Adviser fee includes provision for a cap on expenses excluding irrecoverable VAT and exceptional items set at 3.4% of closing net assets at the year-end. In accordance with the investment management agreement, any excess expenses are borne by the Investment Adviser. The excess expenses during the year amounted to GBPnil (2015: GBPnil).
The Company is responsible for external costs such as legal and accounting fees, incurred on transactions that do not proceed to completion ("abort expenses") subject to the cap on total annual expenses referred to above.
In line with common practice, Mobeus Equity Partners LLP retain the right to charge arrangement and syndication fees and Directors' or monitoring fees to companies in which the Company invests. The Investment Adviser received fees totalling GBP219,348 (2015: GBP365,994) during the year ended 31 December 2016, being GBP62,480 (2015: GBP210,253) for arrangement fees, and GBP156,868 (2015: GBP155,741) for acting as non-executive directors on a number of investee company boards. These fees attributable to MIG 4 VCT are based upon the investment allocation to MIG 4 VCT which applied at the time of each investment. These figures are not part of these Financial Statements.
Under the terms of a separate agreement dated 1 November 2006, from the end of the accounting period ending on 31 January 2009 and in each subsequent accounting period throughout the life of the company, the Investment Adviser will be entitled to receive a performance related incentive fee of 20% of the dividends paid in excess of a "Target Rate" comprising firstly, an annual dividend target of 6% of the net asset value per share at 5 April 2007 (indexed each year for RPI) and secondly a requirement that any cumulative shortfalls below the 6 per cent hurdle must be made up in later years, while any excess is not carried forward, whether a fee is payable for that year or not. Payment of a fee is also conditional upon the average Net Asset Value ("NAV") per share for each such year equalling or exceeding the average Base NAV per share for the same year. The performance fee will be payable annually. No incentive fee is payable to date.
b) Offer for Subscription fees
No funds were raised by an offer by the VCT in the year (2015: GBP6.00 million). Accordingly, no subscription fees were payable to Mobeus in the year (2015: GBP0.19 million) where all costs associated with the offer were met out of these fees by Mobeus, excluding any payments to financial advisers facilitated under the terms of the offer).
c) Other expenses
Expenses are charged wholly to revenue, with the exception of
expenses incidental to the acquisition or disposal of an investment,
which are written off to the capital column of the Income Statement
or deducted from the disposal proceeds as appropriate.
----------------------------------------------------------------------
2016 2015
GBP GBP
--------------------------------------------------------------- -------- --------
Directors' remuneration (including NIC of GBP8,327
(2015: GBP9,327) (note i) 98,827 99,827
IFA trail commission 73,779 77,227
Broker's fees 12,000 12,000
Auditor's fees - Audit of Company (excluding VAT) 21,525 23,600
- audit related assurance services (excluding
VAT) - note ii) 4,203 4,100
- tax compliance services (excluding VAT) note
ii) 3,752 5,288
Registrar's fees 40,518 45,154
Printing 38,171 34,196
Legal & professional fees 10,686 6,117
VCT monitoring fees 9,600 9,000
Directors' insurance 8,350 9,248
Listing and regulatory fees 40,680 39,132
Sundry 8,808 8,511 --------------------------------------------------------------- -------- -------- Running costs 370,899 373,400 Provision against loan interest receivable (note iii) - 28,756 --------------------------------------------------------------- -------- -------- Other expenses 370,899 402,156 --------------------------------------------------------------- -------- --------
Note i): See analysis in Directors' Remuneration table in the Report and Accounts, which excludes the NIC above. The key management personnel are the three non-executive directors. The Company has no employees.
Note ii): The Directors consider the Auditor was best placed to provide the other services disclosed above. The Audit Committee reviews the nature and extent of these services to ensure that auditor independence is maintained.
Note iii) In the current year, there is no provision against loan interest recognised in previous years (2015: GBP28,756).
5 Taxation on profit/(loss) on ordinary activities
The tax expense for the year comprises current tax and is recognised
in profit or loss. The current income tax charge is calculated
on the basis of tax rates and laws that have been enacted or
substantively enacted by the reporting date.
Any tax relief obtained in respect of Investment Adviser's fees
allocated to capital is reflected in the capital reserve - realised
and a corresponding amount is charged against revenue. The tax
relief is the amount by which corporation tax payable is reduced
as a result of these capital expenses.
Deferred tax 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 a right to pay less tax in the
future have occurred at the balance sheet date. Timing differences
are differences between the Company's taxable profits and its
results as stated in the financial statements that arise from
the inclusion of gains and losses in the tax assessments in
periods different from those in which they are recognised in
the financial statements.
Deferred tax is measured at the average tax rates that are expected
to apply in the years in which the timing differences are expected
to reverse based on tax rates and laws that have been enacted
or substantively enacted at the balance sheet date. Deferred
tax is measured on a non-discounted basis.
A deferred tax asset would be recognised only to the extent
that it is more likely than not that future taxable profits
will be available against which the asset can be utilised.
----------------------------------------------------------------------------------
2016 2016 2016 2015 2015 2015
Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
---------------------------------- ----------- ----------- --------- ----------- ----------- -----------
a) Analysis of tax charge:
UK Corporation tax on
profits/(losses) for the
year 212,864 (182,776) 30,088 184,209 (184,209) -
---------------------------------- ----------- ----------- --------- ----------- ----------- -----------
Total current tax charge/(credit) 212,864 (182,776) 30,088 184,209 (184,209) -
---------------------------------- ----------- ----------- --------- ----------- ----------- -----------
Corporation tax is based
on a rate of 20% (2015:
20%)
b) Profit/(loss) on ordinary
activities before tax 1,344,052 (910,474) 433,578 1,496,175 3,485,431 4,981,606
Profit/(loss) on ordinary
activities multiplied
by company rate of corporation
tax in the UK of 20% (2015:
20%) 268,810 (182,095) 86,715 299,235 697,086 996,321
Effect of:
UK dividends not taxable (21,209) - (21,209) (12,350) - (12,350)
Unrealised losses/(gains)
not taxable - 75,535 75,535 - (218,857) (218,857)
Realised gains not taxable - (76,216) (76,216) - (660,464) (660,464)
Marginal relief - - - 1,974 (1,974) -
Losses brought forward (34,737) - (34,737) (104,650) - (104,650)
---------------------------------- ----------- ----------- --------- ----------- ----------- -----------
Actual tax charge 212,864 (182,776) 30,088 184,209 (184,209) -
---------------------------------- ----------- ----------- --------- ----------- ----------- -----------
Tax relief relating to Investment Adviser fees is allocated between revenue and capital where such relief can be utilised.
No asset or liability has been recognised for deferred tax in relation to capital gains or losses on revaluing investments as the Company is exempt from corporation tax in relation to capital gains or losses as a result of qualifying as a Venture Capital Trust.
There is no potential liability to deferred tax (2015: GBPnil). There is no unrecognised deferred tax asset in 2016 (2015: GBP34,737).
6 Dividends paid and payable Dividends payable are recognised as distributions in the
financial statements when the Company's liability to pay
them has been established. This liability is established
for interim dividends when they are paid, and for final dividends
when they are approved by the shareholders, usually at the
Company's annual general meeting.
A key judgement in applying the above accounting policy is
in determining the amount of minimum income dividend to be
paid in respect of a year. The Company's status as a VCT
means it has to comply with Section 259 of the Income Tax
Act 2007, which requires that no more than 15% of the income
from shares and securities in a year can be retained from
the revenue available for distribution for the year.
-------------------------------------------------------------------
Amounts recognised as distributions to equity shareholders in the
year:
For year Pence 2016 2015
Dividend Type ended 31 per Date Paid GBP GBP
December share
---------- ----------- --------- ------- --------- ---------- ----------------------
Second 6 May
Interim Income 2014 1.00p 2015 - 476,355
Second 6 May
Interim Capital 2014 7.00p 2015 - 3,334,494
25
September
Interim Income 2015 1.00p 2015 - 481,961
25
September
Interim Capital 2015 1.00p 2015 - 481,961
25 May
Final Income 2015 1.50p 2016 725,346 -
25 May
Final Capital 2015 7.50p 2016 3,626,735 -
8
September
Interim Income 2016 1.00p 2016 489,895 -
8
September
Interim Capital 2016 1.00p 2016 489,895 -
---------- ----------- --------- ------- --------- ---------- ----------------------
5,331,871* 4,774,771
-------------------------------- ------- --------- ---------- ----------------------
* - GBP5,331,871 (2015: GBP4,774,771) disclosed above differs to that shown in the Statement
of Cash Flows of GBP4,411,541 (2015: GBP3,963,579) due to GBP920,330 (2015: GBP811,192) of
new shares issued as part of the DIS scheme.
Distributions to equity holders after the year-end:
For year Pence 2016 2015
Dividend Type ended per Date GBP GBP
31 share Payable
December
----------- ----------- ------------- ----------- ------- --------- ----------------------
25 May
Final Income 2015 1.50 2016 - 725,343
25 May
Final Capital 2015 7.50 2016 - 3,626,716
17
Second March
interim Income 2016 1.00 2017 490,430 -
17
Second March
interim Capital 2016 6.00 2017 2,942,582 -
----------- ----------- ------------- ----------- ------- --------- ----------------------
3,433,012 4,352,059
------------------------------------- ----------- ------- --------- ----------------------
Any proposed final dividend is subject to approval by shareholders at the Annual General Meeting
and has not been included as a liability in these Financial Statements.
Set out below are the total income dividends payable 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.
Recognised income distributions in the financial statements for the
year
For year
ended Pence 2016 2015
Dividend Type For the year Pence Date 2016 2015
ended per paid/payable GBP GBP
31 December share
----------- -------------- -------------- ------ -------------- ---------------- ----------------
Revenue available for distribution by way
of dividends for the year 1,131,188 1,311,966
------------------------------------------------------------------ ---------------- ------------------
25 September
Interim Income 2015 1.00p 2015 - 481,961
Final Income 2015 1.50p 25 May 2016 - 725,343
8 September
Interim Income 2016 1.00p 2016 489,895 -
Second
interim Income 2016 1.00p 17 March 2017 490,430 -
--------------- -------------- --------- ------ -------------- ---------------- ------------------
Total income dividends for the year 980,325 1,207,304
------------------------------------------------------------------ ---------------- ----------------
7 Basic and diluted earnings per share 2016 2015
GBP GBP
-------------------------------------- ---------- ----------
Total earnings after taxation: 403,490 4,981,606
Basic and diluted earnings per share
(note a) 0.83p 10.41p
-------------------------------------- ---------- ----------
Net revenue from ordinary activities
after taxation 1,131,188 1,311,966
Basic and diluted revenue return per
share (note b) 2.32p 2.74p
-------------------------------------- ---------- ----------
Net unrealised capital (losses)/gains (377,677) 1,094,287
Net realised capital gains 381,087 3,302,320
Capital expenses (net of taxation) (731,108) (726,967)
-------------------------------------- ---------- ----------
Total capital return (727,698) 3,669,640
Basic and diluted capital return per
share (note c) (1.49)p 7.67p
-------------------------------------- ---------- ----------
Weighted average number of shares in
issue in the year 48,793,978 47,857,465
-------------------------------------- ---------- ----------
Notes:
a) Basic earnings per share is total earnings after taxation divided by the weighted average
number of shares in issue.
b) Revenue earnings per share is the revenue return after taxation divided by the weighted
average number of shares in issue.
c) Capital earnings per share is the total capital profit after taxation divided by the weighted
average number of shares in issue.
d) There are no instruments that will increase the number of shares in issue in future. Accordingly,
the above figures currently represent both basic and diluted returns.
8. Investment at fair value
The most critical estimates, assumptions and judgments relate to the determination of the
carrying value of investments at "fair value through profit and loss" ("FVTPL"). All investments
held by the Company are classified as FVTPL and measured 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 IPEV 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, each investment is considered as a whole on a 'unit of account' basis,
alongside consideration of:
(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.
(iii) Premiums, to the extent that they are considered capital in nature, 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.
A key judgement made in applying the above accounting policy relates to investments that are
permanently impaired. 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
loss 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.
----------------------------------------------------------------------------------------------------------------------------------------------
Movements in investments during the year are summarised as follows:
Traded on Unquoted Unquoted Loan stock Total
AIM equity preference
shares shares
GBP GBP GBP GBP GBP
----------------- --------- ---------------- ------------- ----------- ------------
Cost at 31
December 2015 200,028 11,827,294 15,144 26,249,570 38,292,036
Unrealised
gains/(losses)
at 31 December
2015 58,319 (13,042) (444) 1,500,531 1,545,364
Permanent
impairment in
value
of investments
as at 31
December
2015 - (551,595) (1,649) (567,486) (1,120,730)
----------------- --------- ---------------- ------------- ----------- ------------
Valuation at 31
December
2015 258,347 11,262,657 13,051 27,182,615 38,716,670
Purchases at cost - 2,190,947 - 112,194 2,303,141
Sale proceeds - (574,405) - (1,522,382) (2,096,787)
Net realised
gains in the
year - 199,647 - 181,440 381,087
Unrealised
gains/(losses)
in the year 33,335 (2,873,959) (284) 2,463,231 (377,677)
----------------- --------- ---------------- ------------- ----------- ------------
Closing valuation
at 31 December
2016 291,682 10,204,887 12,767 28,417,098 38,926,434
----------------- --------- ---------------- ------------- ----------- ------------
Cost at 31
December 2016 200,028 13,111,998 15,144 25,036,502 38,363,672
Unrealised
gains/(losses)
at 31 December
2016 91,654 (2,887,001) (728) 3,948,082 1,152,007
Permanent
impairment in
value
of investments
at 31 December
2016 - (20,110) (1,649) (567,486) (589,245)
----------------- --------- ---------------- ------------- ----------- ------------
Valuation at 31
December
2016 291,682 10,204,887 12,767 28,417,098 38,926,434
----------------- --------- ---------------- ------------- ----------- ------------
Details of investment transactions such as disposal proceeds, valuation movements cost and carrying value at the end of previous year are contained in the Investment Portfolio Summary in the 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 risk or market risk upon these instruments.
Reconciliation of investment transactions to Statement of Cash flows
Purchases above of GBP2,303,141 are less than that shown in the Statement of Cash flows of GBP2,883,610, by GBP580,469. This relates to the Tapas Revolution investment that completed on 4 January 2017, and these funds were shown as part of debtors at the year end.
The cash flow from investment proceeds shown above of GBP2,096,787 differs from the sale proceeds shown in the Statement of Cash flows of GBP2,402,008, by GBP305,221. This is due to GBP305,221 of deferred cash sale proceeds, which were received during the year relating to a prior year.
Major movements in investments
Disposals of investment portfolio companies during the year were:
Type Investment Disposal Valuation Realised
cost proceeds at 31 December gain in
2015 year
GBP GBP GBP GBP
-------------------------- ----------------------- ---------- ------------ ---------------- --------------
Master Removers
Group Limited (formerly
Leap New Co Limited) Loan repayment 836,825 836,825 836,825 -
Barham Consulting
Limited Loan repayment 272,160 453,600 453,600 -
Focus Pharma Holdings
Limited Deferred consideration - 371,652 - 371,652
Pound FM Consultants Loan repayment and
Limited share buyback 295,623 295,623 295,623 -
Loan payments/deferred
Others consideration 113,972 139,087 129,652 9,435
-------------------------- ----------------------- ---------- ------------ ---------------- --------------
1,518,580 2,096,787 1,715,700 381,087
-------------------------------------------------- ---------- ------------ ---------------- --------------
The major components of the decrease in unrealised valuations of GBP377,977 in the year were decreases of GBP1,083,908 in Entanet Holdings Limited, GBP433,708 in Jablite Holdings Limited, and GBP376,022 in Veritek Global Limited. This fall was partly offset by increases of GBP501,716 in Turner Topco Limited (trading as ATG Media), GBP303,969 in RDL Corporation Limited and GBP289,365 in Vian Marketing Limited (trading as Tushingham Sails).
During the year, permanent impairments of the cost of investments have decreased from GBP1,120,730 to GBP589,245. The net reduction is due to an investee company being dissolved in the year, which removes the cost and related impairment of this investment from these accounts, and an impairment of the equity of another investee company.
9 Annual Report
The Annual Report for the year ended 31 December 2016 will shortly be made available on the Company's website: www.mig4vct.co.uk and shareholders will be notified of this by email or post or sent a hard copy in the post in accordance with their instructions. Copies will be available thereafter to members of the public from the Company's registered office.
10 Annual General Meeting
The Annual General Meeting of the Company will be held at 11.30 am on Monday 8 May 2017 at
The Clubhouse, 8 St James's Square, London, SW1Y 4JU.
Contact details for further enquiries:
Robert Brittain of Mobeus Equity Partners LLP (the Company Secretary) on 020 7024 7600 or by e-mail to vcts@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
ACSJTMRTMBTTBBR
(END) Dow Jones Newswires
March 23, 2017 04:00 ET (08:00 GMT)
1 Year Mobeus Income & Growth 4... Chart |
1 Month Mobeus Income & Growth 4... Chart |
It looks like you are not logged in. Click the button below to log in and keep track of your recent history.
Support: +44 (0) 203 8794 460 | support@advfn.com
By accessing the services available at ADVFN you are agreeing to be bound by ADVFN's Terms & Conditions
