ProVen Plnd Ex VCT Proven Planned Exit Vct Plc : Annual Financial Report

 
TIDMPPE 
 
 
   PROVEN PLANNED EXIT VCT PLC 
 
   ANNUAL FINANCIAL REPORT 
 
   YEAR ENDED 31 JANUARY 2013 
 
   Financial summary 
 
 
 
 
Ordinary Shares                               31 January 2013  31 January 2012 
Net asset value per share ("NAV")                       80.8p            88.7p 
Dividends paid since launch                              9.0p             3.0p 
Total return (NAV plus dividends paid since             89.8p            91.7p 
launch) 
Mid market share price                                  85.0p            97.0p 
 
 
 
 
'A' Shares                                    31 January 2013  31 January 2012 
Net asset value per share ("NAV")                        0.1p             0.1p 
Dividends paid since launch                                 -                - 
Total return (NAV plus dividends paid since              0.1p             0.1p 
launch) 
Mid market share price                                   0.1p             0.1p 
 
 
   Chairman's Statement 
 
   Introduction 
 
   I have pleasure in presenting the second annual report for ProVen 
Planned Exit VCT plc (the "Company") to Shareholders for the year ended 
31 January 2013. 
 
   Results 
 
   The loss on activities after taxation was GBP90,000 (2012: GBP131,000), 
comprising a revenue loss of GBP46,000 (2012: GBP85,000) and a capital 
loss of GBP44,000 (2012: GBP46,000). The net asset value total return, 
comprising net asset value and dividends paid since launch, was 89.8p 
per Ordinary Share (2012: 91.7p) and 0.1p per 'A' Share (2012: 0.1p). 
 
   Dividends 
 
   In accordance with the terms of the Offer, the Directors intend that the 
Company pays two dividends per year of 3p each, subject to the 
availability of sufficient cash reserves and distributable reserves. 
 
   The Company paid an interim dividend for the year ended 31 January 2013 
of 3p per Ordinary Share on 21 November 2012 to Ordinary Shareholders on 
the register as at 9 November 2012. 
 
   The Company is proposing a final dividend for the year ended 31 January 
2013 of 3p per Ordinary Share which will be subject to approval by 
Shareholders at the Annual General Meeting of the Company on 17 July 
2013. The dividend will, subject to this approval, be paid on 24 July 
2013 to Ordinary Shareholders on the register as at 12 July 2013. 
 
   Portfolio activity and valuation 
 
   At 31 January 2013, the Company's venture capital investment portfolio 
comprised three venture capital investments at a cost of GBP1.2 million 
and a valuation of GBP1.2 million (2012: GBP0.45 million and GBP0.45 
million respectively). In addition, the Company held cash and other 
liquid funds of GBP2.2 million. 
 
   After the year end, an investment of GBP550,000 was made into Fjordnet 
Limited and GBP500,000 into Campden Media Limited. The investment into 
Fjordnet Limited was then repaid in full in May, when the company was 
acquired. 
 
   Share buybacks 
 
   The Directors intend that, in the five years following the first 
allotment of shares, the Company will operate a policy of buying back 
its own shares for cancellation at a zero discount to net asset value. 
It should be noted, however, that a disposal of VCT shares within five 
years from allotment may result in the loss of the initial income tax 
relief. Given the intended life of the Company, it is not intended that 
any shares will be bought back after the fifth anniversary of the first 
allotment of shares. 
 
   No shares were purchased by the Company during the year. 
 
   Annual General Meeting 
 
   The Annual General Meeting ("AGM") of the Company will be held at 39 
Earlham Street, London WC2H 9LT at 3.00 pm on 17 July 2013. 
 
   Shareholder presentation 
 
   I was pleased to meet a number of the Company's Shareholders at the 
Investment Manager's annual shareholder presentation held on 22 October 
2012 at the Royal College of Surgeons in central London. The event 
provided an opportunity for Shareholders to hear directly from, and meet, 
portfolio companies, the Investment Manager, VCT directors and other 
Shareholders. The feedback from the event was positive and the board 
looks forward to this year's presentation in the autumn. Further details 
of the event will be communicated to Shareholders in due course. 
 
   The Board is always pleased to hear comments from Shareholders outside 
the AGM and shareholder event and can be contacted through the Company's 
registered office at 39 Earlham Street, London WC2H 9LT. 
 
   Outlook 
 
   The Company continues to seek out lower risk investment opportunities in 
accordance with its investment mandate. Whilst investments are being 
targeted, the Company has kept its assets in lower risk cash and liquid 
fund investments. Whilst it is still early in the Company's life, the 
investments are developing as planned and the Board therefore remains 
optimistic about meeting the stated objective for Shareholders. 
 
   Peter L R Hewitt 
 
   Chairman 
 
 
 
 
 
   Investment Manager's Review 
 
   Introduction 
 
   We have pleasure in presenting our report for ProVen Planned Exit VCT 
plc (the "Company" or "PPE") for the year to 31 January 2013. 
 
   Beringea LLP is a specialist venture capital management company which 
traces its origins back over 25 years. It currently manages over GBP100 
million of VCT funds through four VCTs and has managed VCTs since their 
inception in 1996. This experience gives Beringea access to interesting 
and potentially larger investment opportunities which may not be 
available to a smaller standalone VCT. The recent investment in Fjordnet 
Limited, completed shortly after the year end, resulted from our 
established relationship with the company and the ability through the 
VCTs to provide a flexible funding package which met its requirements. 
 
   The Company made two investments totalling GBP1 million in qualifying 
venture capital companies during the year ended 31 January 2013. 
Subsequent to the year end, the Company has completed another two VCT 
qualifying investments totalling GBP1.05 million and disposed of a VCT 
qualifying investment for a small profit. 
 
   Investment activity and portfolio valuation 
 
   As at 31 January 2013, the Company's venture capital investment 
portfolio comprised two VCT qualifying investments with a cost and 
valuation of GBP1 million and one non-VCT qualifying investment with a 
cost and valuation of GBP200,000. In addition, the Company had a further 
committed investment of GBP550,000, included in debtors, and held cash 
and other liquid funds of GBP2.2 million. 
 
   In February 2012, the Company completed an investment comprising a 
combination of equity and loan notes totalling GBP600,000 into Cross 
Solar PV Limited ("Cross Solar"). Cross Solar is a solar energy company 
which owns a portfolio of solar installations on the residential 
rooftops, over which it has a 25-year lease. This entitles Cross Solar 
to receive payments under the Government backed "feed-in tariff" scheme 
for the generation of renewable energy. Cross Solar is managed by one of 
the most experienced teams in this sector in the UK. PPE invested 
alongside ProVen VCT plc and ProVen Growth and Income VCT plc as part of 
a total investment by Beringea-managed VCTs of GBP2.6 million. The 
investment has been structured to provide an attractive yield, security 
against the assets of Cross Solar and a redemption premium on the loan 
notes. Cross Solar is performing in line with expectations and the 
investment has been valued at cost. 
 
   In April 2012, the Company completed a GBP400,000 investment in Long 
Eaton Healthcare Limited ("LEH"). LEH provides pharmacy services in an 
existing GP centre in Long Eaton, near Nottingham and is managed by APM 
Healthcare, in which other Beringea-managed VCTs have invested. APM 
Healthcare, through its subsidiary Community Pharmacies (UK) Limited, is 
establishing a number of practice-based pharmacies in conjunction with 
local GPs with expert support and guidance from a centralised head 
office. The loan element of the investment is secured over LEH's assets. 
The investment is valued at cost. 
 
   In April 2012, the Company's GBP250,000 loan to Campden Media Limited 
was repaid in full, in accordance with the original investment plan. The 
loan facility provided an attractive yield relative to the interest 
rates available on cash alternatives. 
 
   Eagle-i Music Limited ("Eagle-i"), in which the Company invested in 
January 2012, manages music publishing properties. Eagle-i has continued 
to add to the properties it manages throughout the year. The majority of 
the investment is in the form of a loan at an attractive interest rate. 
Eagle-i is valued at cost. 
 
   Post year end portfolio activity 
 
   In February 2013, the Company completed a VCT qualifying investment of 
GBP550,000, in a combination of equity and loan notes, into Fjordnet 
Limited. Fjordnet is an established digital design agency which works 
across many sectors, including telecommunications, media, finance and 
healthcare. It has worked on market leading flagship projects - 
including projects for the BBC, Nokia, Orange, Swisscom and Yahoo!. 
Fjordnet was instrumental in bringing the hugely successful 
award-winning BBC iPlayer to mobile. The company has offices in London, 
Helsinki, Berlin, Paris, Madrid, Stockholm, New York, San Francisco and 
Istanbul. Although it was a new investment for the Company, Fjordnet 
Limited has had previous rounds of funding from ProVen VCT plc and 
ProVen Growth and Income VCT plc since December 2008, amounting to GBP3 
million. This latest round of funding took the total invested by all 
Beringea-managed VCTs to GBP4.5million. 
 
   Fjordnet was acquired by Accenture Holdings B.V., a subsidiary of 
Accenture (NYSE: ACN) on 22 May 2013. This resulted in the full 
repayment of the loan notes and generated a small profit for the 
Company. 
 
   In April 2013, the Company provided a working capital facility of 
GBP500,000, made up of equity and loan notes, to Campden Media Limited, 
a magazine publisher and event organiser. The Company first invested in 
Campden Media in December 2011, with this funding being subsequently 
repaid in April 2012. The new loan facility provides an attractive yield 
relative to the interest rates available on cash alternatives. 
 
   Outlook 
 
   In the year to the date of this review, we have made good progress 
towards our goal of meeting the investment targets under the VCT 
legislation. The Company has until 31 January 2014 to invest, broadly, 
70% of the funds raised from the initial fundraising after adjusting for 
net expenses and distributions. The reluctance of banks to lend to 
businesses is providing opportunities for alternative funders such as 
VCTs. In addition, the existing portfolios of the Beringea managed VCTs 
have provided attractive opportunities to PPE which would not be 
available to other VCTs. We will continue to be selective about the 
opportunities in which we invest with the aim of building up an 
attractive and robust portfolio to deliver the targeted returns to 
investors. 
 
   Beringea LLP 
 
   Investment Portfolio 
 
   as at 31 January 2013 
 
   The following investments were held at 31 January 2013: 
 
 
 
 
                                                  Valuation          % of 
                                   Valuation     movement in     portfolio by 
                  Cost GBP'000      GBP'000      year GBP'000        value 
Venture capital 
investments 
Cross Solar PV 
 Limited(1)                600             600               -           15.2% 
Long Eaton 
 Healthcare 
 Limited(2)                400             400               -           10.1% 
Eagle-i Music 
 Limited(3)                200             200               -            5.1% 
Total venture 
 capital 
 investments             1,200           1,200               -           30.4% 
 HSBC liquidity 
  fund                                     503                           12.7% 
Insight 
 liquidity 
 fund                                      500                           12.7% 
Cash at bank 
 and in hand                             1,198                           30.3% 
Other 
 debtors(4)                                550                           13.9% 
 
Total 
 investments                             3,951                          100.0% 
 
 
   All venture capital investments are unquoted unless otherwise stated. 
 
   1.    Cross Solar PV Limited is also held by ProVen VCT plc and ProVen 
Growth and Income VCT plc. 
 
   2.    Long Eaton Healthcare Limited is also held by ProVen VCT plc, 
ProVen Growth and Income VCT plc and ProVen Health VCT plc. 
 
   3.    Eagle-i Music Limited is also held by ProVen Growth and Income VCT 
plc. ProVen VCT plc and ProVen Growth and Income VCT plc also hold an 
investment in Eagle Rock Entertainment Group Limited which is a 
significant shareholder in Eagle-i Music Limited. 
 
   4.    Other debtors of GBP550,000 relates to an investment in Fjordnet 
Limited, which completed on 21 February 2013. Fjordnet Limited was also 
held in ProVen VCT plc and ProVen Growth and Income VCT plc at 31 
January 2013. 
 
   The relationship between the VCTs managed by Beringea is covered by a 
co-investment agreement. 
 
   All venture capital investments held at the year end are registered in 
England and Wales. 
 
   Directors' Responsibilities Statement 
 
   The Directors are responsible for preparing the Report of the Directors, 
the Directors' Remuneration Report and the financial statements in 
accordance with applicable law and regulations. 
 
   Company law requires the Directors to prepare financial statements for 
each financial year. Under that law the directors have elected to 
prepare the financial statements in accordance with United Kingdom 
Generally Accepted Accounting Practice (United Kingdom Accounting 
Standards and applicable laws). 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 and profit or loss of 
the company for that year. 
 
   In preparing these financial statements, the Directors are required to: 
 
 
   -- select suitable accounting policies and then apply them consistently; 
 
 
   -- make judgments and accounting estimates that are reasonable and prudent; 
 
 
   -- state whether UK Accounting Standards have been followed, subject to any 
      material departures disclosed and explained in the financial statements; 
      and 
 
 
   -- prepare the financial statements on the going concern basis unless it is 
      inappropriate to presume that the company will continue in business. 
 
 
   The Directors are responsible for keeping adequate accounting records 
that are sufficient to show and explain the company's transactions and 
disclose with reasonable accuracy at any time the financial position of 
the company and enable them to ensure that the financial statements and 
the Directors' Remuneration Report 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. 
 
   The Directors confirm that: 
 
 
   -- so far as each director is aware there is no relevant audit information 
      of which the company's auditor is unaware; and 
 
 
   -- the Directors have taken all steps that they ought to have taken as 
      directors to make themselves aware of any relevant audit information and 
      to establish that the auditor is aware of that information. 
 
 
   The Directors are responsible for the maintenance and integrity of the 
corporate and financial information included on the company's website. 
Legislation in the United Kingdom governing the preparation and 
dissemination of financial statements may differ from legislation in 
other jurisdictions. 
 
   Directors' statement pursuant to the Disclosure and Transparency Rules 
 
   Each of the Directors, confirms that, to the best of his or her 
knowledge: 
 
 
   -- the financial statements, which have been prepared in accordance with 
      United Kingdom Generally Accepted Accounting Practice, give a true and 
      fair view of the assets, liabilities, financial position and loss of the 
      Company; and 
 
 
   -- the management report contained in the Chairman's Statement, Investment 
      Manager's Review and Report of the Directors 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. 
 
 
   On behalf of the Board 
 
   Peter L R Hewitt 
 
   Chairman 
 
   ProVen Planned Exit VCT plc 
 
   Company number: 07333086 
 
   Registered Office: 
 
   39 Earlham Street 
 
   London WC2H 9LT 
 
   Income Statement 
 
   for the year ended 31 January 2013 
 
 
 
 
                                    2013                       2012 
                          Revenue  Capital   Total   Revenue  Capital   Total 
                          GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
 
Income                         66        -       66       13        -       13 
 
Investment management 
 fees                        (15)     (44)     (59)     (12)     (37)     (49) 
Other expenses               (97)        -     (97)     (86)      (9)     (95) 
Losses on ordinary 
 activities before tax       (46)     (44)     (90)     (85)     (46)    (131) 
Tax on ordinary 
activities                      -        -        -        -        -        - 
Losses attributable to 
 equity shareholders         (46)     (44)     (90)     (85)     (46)    (131) 
 
Basic and diluted loss 
 per share                 (1.0p)   (0.9p)   (1.9p)   (1.9p)   (1.0p)   (2.9p) 
 
 
 
 
   All revenue and capital items in the above statement derive from 
continuing operations. The total column within the Income Statement 
represents the profit and loss account of the Company. 
 
   The Company has no recognised gains or losses other than the results for 
the year as set out above. 
 
   Reconciliation of Movements in Shareholders' Funds 
 
   for the year ended 31 January 2013 
 
 
 
 
 
                                               2013     2012 
                                              GBP'000  GBP'000 
 
Opening shareholders' funds                     4,281        - 
Proceeds from share issues                          -    4,714 
Share issue costs                                   -    (157) 
Total recognised losses for the year/period      (90)    (131) 
Dividends paid                                  (289)    (145) 
Closing shareholders' funds                     3,902    4,281 
 
 
 
 
   Balance Sheet 
 
   as at 31 January 2013 
 
 
 
 
 
                                                   2013     2012 
                                                  GBP'000  GBP'000 
Fixed assets 
Investments                                         1,200      450 
 
Current assets 
Debtors                                               563       10 
Investments                                         1,003      380 
Cash at bank and in hand                            1,198    3,523 
                                                    2,764    3,913 
Creditors: amounts falling due within one year       (62)     (82) 
 
Net current assets                                  2,702    3,831 
 
Net assets                                          3,902    4,281 
 
 
Capital and reserves 
Called up Ordinary Share capital                        5        5 
Called up 'A' Share capital                             7        7 
Share premium account                                   -        - 
Special distributable reserve                       4,111    4,400 
Capital reserve - realised                           (90)     (46) 
Revenue reserve                                     (131)     (85) 
Total equity shareholders' funds                    3,902    4,281 
 
 
Ordinary Share                                      80.8p    88.7p 
'A' Share                                            0.1p     0.1p 
 
 
 
 
 
   Cash Flow Statement 
 
   for the year ended 31 January 2013 
 
 
 
 
                                                                      Period 
                                                     Year ended     ended 31 
                                                     31 January      January 
                                                           2013         2012 
                                                        GBP'000    GBP'000 
 
Net cash outflow from operating activities                (663)         (59) 
 
Capital expenditure: 
Purchase of investments                                 (1,000)        (450) 
Repayment of loan                                           250            - 
Net cash outflow from capital expenditure                 (750)        (450) 
 
Equity dividends paid                                     (289)        (145) 
 
 
Management of liquid resources: 
Purchase of current investments held as liquidity 
 funds                                                    (623)        (500) 
Withdrawal from liquidity funds                               -          120 
Net cash outflow from liquid resources                    (623)        (380) 
 
Net cash outflow before financing                       (2,325)      (1,034) 
 
Financing: 
Proceeds from Ordinary Share issues                           -        4,707 
Proceeds from 'A' Share issues                                -            7 
Proceeds from Preference Share issues                         -           50 
Redemption of Preference Shares                               -         (50) 
Share issue costs                                             -        (157) 
Net cash inflow from financing                                -        4,557 
 
(Decrease)/increase in cash                             (2,325)        3,523 
 
 
 
 
 
   Notes to the Accounts 
 
   for the year ended 31 January 2013 
 
   1.Accounting policies 
 
 
 
   Basis of accounting 
 
   The Company has prepared its financial statements under UK Generally 
Accepted Accounting Practice ("UK GAAP") and in accordance with the 
Statement of Recommended Practice "Financial Statements of Investment 
Trust Companies and Venture Capital Trusts" revised January 2009 
("SORP"). 
 
   The Company's accounting policies remain unchanged from the prior year. 
The financial statements are prepared under the historical cost 
convention except for certain financial instruments measured at fair 
value. 
 
   In accordance with "Going Concern and Liquidity Risk: Guidance for 
Directors of UK Companies 2009", issued by the Financial Reporting 
Council, the Board has assessed the Company's operation as a going 
concern. The Company has considerable financial resources both at the 
year end and at the date of this report comprising of cash, liquidity 
funds and fixed asset investments.  As a consequence, the Directors 
believe that the Company is well placed to manage its business risks 
successfully despite the current uncertain economic outlook. The 
Directors have a reasonable expectation that the Company has adequate 
resources to continue in operational existence for the foreseeable 
future. For this reason they believe that the Company continues to be a 
going concern and that it is appropriate to apply the going concern 
basis in preparing the financial statements. 
 
   The Company implements new Financial Reporting Standards ("FRS") issued 
by the Accounting Standards Board when required. 
 
   Presentation of Income Statement 
 
   In accordance with the SORP, supplementary information which analyses 
the Income Statement between items of a revenue and capital nature has 
been presented alongside the Income Statement. The net revenue is the 
measure the Directors believe appropriate in assessing the Company's 
compliance with certain requirements set out in S274 of the Income Tax 
Act 2007. 
 
   Fixed assets investments 
 
   Investments, including equity and loan stock, are designated as "fair 
value through profit or loss" assets due to investments being managed 
and performance evaluated on a fair value basis.   A financial asset is 
designated within this category if it is both acquired and managed, with 
a view to selling after a period of time, in accordance with the 
Company's documented investment policy.  The fair value of an investment 
upon acquisition is deemed to be cost.  Thereafter investments are 
measured at fair value in accordance with International Private Equity 
and Venture Capital Valuation Guidelines ("IPEVCVG") issued in September 
2009 together with FRS26. 
 
   The valuation methodologies used by the Directors for assessing the fair 
value of unquoted investments are as follows: 
 
 
 
   -- investments are usually retained at cost for an appropriate period 
      following investment, except where a company's performance against plan 
      is significantly below the expectations on which the investment was made 
      in which case a provision against cost is made as appropriate; 
 
 
   -- where a company is in the early stage of development it will normally 
      continue to be held at cost, reviewed for impairment on the basis 
      described above; 
 
 
   --  where a company is well established after an appropriate period, the 
      investment may be valued by applying a suitable earnings or revenue 
      multiple to that company's maintainable earnings or revenue.  The 
      multiple used is based on comparable listed companies or a sector but 
      discounted to reflect factors such as the different sizes of the 
      comparable businesses, different growth rates and the lack of 
      marketability of unquoted shares; 
 
 
   -- where a value is indicated by a material arms-length transaction by a 
      third party in the shares of the company, the valuation will normally be 
      based on this, reviewed for impairment as appropriate; and 
 
 
   -- where alternative methods of valuation, such as net assets of the 
      business or the discounted cash flows arising from the business are more 
      appropriate, then such methods may be used. 
 
 
   The methodology applied takes account of the nature, facts and 
circumstances of the individual investment and uses reasonable data, 
market inputs, assumptions and estimates in order to ascertain fair 
value.  Methodologies are applied consistently from year to year except 
where a change results in a better estimate of fair value. 
 
   Where an investee company has gone into receivership or liquidation, or 
there is little likelihood of a recovery from a company in 
administration, the loss on the investment, although not physically 
disposed of, is treated as being realised. 
 
   Gains and losses arising from changes in fair value are included in the 
Income Statement for the year as a capital item. 
 
   It is not the Company's policy to exercise either significant or 
controlling influence over investee companies.  Therefore the results of 
these companies are not incorporated into the Income Statement except to 
the extent of any dividends or interest accrued.  This is in accordance 
with the SORP that does not require portfolio investments to be 
accounted for using the equity method of accounting. 
 
   Current asset investments 
 
   Current asset investments, which comprise investments in liquidity funds 
with AAA rating, are held at fair value through profit or loss and are 
marked-to-market. Liquidity funds are mutual funds that invest in high 
quality short-term money market instruments enabling investors to access 
a highly diversified and liquid portfolio. These assets are purchased 
and redeemed under a contract and the assets are recognised and 
derecognised on the trade date. These assets are initially measured at 
fair value which equates to cost and subsequently continue to be valued 
at fair value, being the closing price of the fund as issued by the 
provider. 
 
   Income 
 
   Dividend income from investments is recognised when the shareholder's 
right to receive payment has been established, normally the ex dividend 
date. 
 
   Interest income is accrued on a time apportioned basis, by reference to 
the principal outstanding and at the effective interest rate applicable 
and only where there is reasonable certainty of collection. 
 
   Expenses 
 
   All expenses are accounted for on an accruals basis. In respect of the 
analysis between revenue and capital items presented within the Income 
Statement, all expenses have been presented as revenue items except as 
follows: 
 
 
 
   -- expenses which are incidental to the acquisition of an investment are 
      deducted from the Capital Account; 
 
 
   -- expenses which are incidental to the disposal of an investment are 
      deducted from the disposal proceeds of the investment; and 
 
 
   -- expenses are split and presented partly as capital items where a 
      connection with the maintenance or enhancement of the value of the 
      investments held can be demonstrated and accordingly the investment 
      management fee has been allocated 25% to revenue and 75% to capital, in 
      order to reflect the Directors' expected long-term view of the nature of 
      the investment returns of the Company. 
 
 
   Taxation 
 
   The tax effects on different items in the Income Statement are allocated 
between capital and revenue on the same basis as the particular item to 
which they relate, using the Company's effective rate of tax for the 
accounting period. 
 
   Due to the Company's status as a Venture Capital Trust and the continued 
intention to meet the conditions required to comply with S274 of the 
Income Tax Act 2007, no provision for taxation is required in respect of 
any realised or unrealised appreciation of the Company's investments 
which arises. 
 
   Deferred taxation assets are provided in full on timing differences that 
result in an obligation at the balance sheet date to pay more tax, or a 
right to pay less tax at a future date, as rates expected to apply when 
they crystallise based on current tax rates and law. Timing differences 
arise from the inclusion of items of income and expenditure in taxation 
computations in periods different from those in which they are included 
in the accounts. 
 
   Cash 
 
   Cash, for the purposes of the cash flow statement, comprises cash in 
hand and deposits repayable on demand. 
 
   Debtors 
 
   The Company's debtors are initially recognised at fair value and 
subsequently measured at amortised cost using the effective interest 
method. 
 
   Liabilities 
 
   The Company's financial liabilities are initially recognised at fair 
value and subsequently measured at amortised cost using the effective 
interest method. 
 
   Issue costs 
 
   Issue costs in relation to share issues have been deducted from the 
share premium account. 
 
   2. Loss per share 
 
 
 
 
                  Weighted 
                   average    Revenue                  Capital 
                  number of  loss per                  loss per 
                  shares in    share    Revenue loss    share     Capital loss 
                    issue     (pence)      GBP'000     (pence)       GBP'000 
Year ended 31 
 January 2013: 
Ordinary Shares   4,818,237     (1.0p)          (46)      (0.9p)          (44) 
'A' Shares        7,227,354          -             -           -             - 
Year ended 31 
 January 2012: 
Ordinary Shares   4,552,965     (1.9p)          (85)      (1.0p)          (46) 
'A' Shares        5,625,410          -             -           -             - 
 
 
   3. Net asset value per share 
 
 
 
 
 
 
                                                   2013     2012 
                                   2013   2012      Net      Net 
      2013                        Pence  Pence    asset    asset 
 Shares in                          per    per    value    value 
     issue  2012 Shares in issue  share  share  GBP'000  GBP'000 
 
Ordinary 
 Shares     4,818,237  4,818,237   80.8   88.7    3,895    4,274 
'A' Shares  7,227,352  7,227,352    0.1    0.1        7        7 
Net assets                                        3,902    4,281 
 
 
 
   The Directors allocate the assets and liabilities of the Company between 
the Ordinary Shares and 'A' Shares such that each share class has 
sufficient net assets to represent its dividend and return of capital 
rights. 
 
   As the Company has not issued any convertible securities or share 
options, there is no dilutive effect on net asset per share.  The net 
asset value per share disclosed therefore represents both basic and 
diluted net asset value per share. 
 
   4. Principal financial risks and management objectives 
 
   The Company's investment activities expose the Company to a number of 
risks associated with financial instruments and the sectors in which the 
Company invests. The principal financial risks arising from the 
Company's operations are: 
 
 
   -- market risks; 
 
 
   -- credit risk; and 
 
 
   -- liquidity risk. 
 
 
   The Board regularly reviews these risks and the policies in place for 
managing them. There have been no significant changes to the nature of 
the risks that the Company is exposed to over the year and there have 
also been no significant changes to the policies for managing those 
risks during the year. 
 
   The risk management policies used by the Company in respect of the 
principal financial risks and a review of the financial instruments held 
at the year end are provided below: 
 
   Market risks 
 
   As a VCT, the Company is exposed to market risks in the form of 
potential losses and gains that may arise on the investments it holds. 
The key market risk to which the Company is exposed is market price 
risk.  The Company has undertaken sensitivity analysis on its financial 
instruments, split into the relevant component parts, taking into 
consideration the economic climate at the time of review in order to 
ascertain the appropriate risk allocation. 
 
   Market price risk 
 
   Market price risk arises from uncertainty about the future prices of 
financial instruments held in accordance with the Company's investment 
objectives.  It represents the potential loss that the Company might 
suffer through changes in the fair value of unquoted investments. 
 
   It is not the Company's policy to use derivative instruments to mitigate 
market risk, as the Board believes that the effectiveness of such 
instruments does not justify the cost involved. 
 
   The sensitivity analysis below assumes that each of the sub categories 
of financial instruments (ordinary shares, preference shares, loan 
stocks and liquidity funds) held by the Company produces an overall 
movement of 20%.  Shareholders should note that equal correlation 
between these sub categories is unlikely to be the case in reality, 
particularly in the case of loan stock instruments.  This is because the 
loan stock instruments would not share in the impact of any increase in 
share prices to the same extent as the equity instruments, as the 
returns are set by reference to interest rates and premiums agreed at 
the time of the initial investment.  Similarly, where share prices are 
falling, the equity instrument could fall in value before the loan stock 
instrument.  It is not considered practical to assess the sensitivity of 
the loan stock instruments to market price risk in isolation. 
 
 
 
 
Sensitivity               2013 - 20% fall                          2012 - 20% fall 
                                              Impact                                   Impact 
                                              on NAV                                   on NAV 
                                               per                                      per 
                Risk                         Ordinary    Risk                         Ordinary 
              exposure       Impact on        Share    exposure       Impact on        Share 
              GBP'000    net assets GBP'000   Pence    GBP'000    net assets GBP'000   Pence 
 
Venture 
 capital 
 investments     1,200                (240)    (4.9p)       450                 (90)    (1.9p) 
Liquidity 
 fund            1,003                (201)    (4.1p)       380                 (76)    (1.5p) 
                 2,203                (441)    (9.0p)       830                (166)    (3.4p) 
 
 
   Credit risk 
 
   Credit risk is the risk that a counterparty to a financial instrument is 
unable to discharge a commitment made under that instrument. The Company 
is exposed to credit risk through its holdings of investments in loan 
stock, liquidity funds, cash deposits and debtors. 
 
   The Company's exposure to credit risk is summarised as follows: 
 
 
 
 
 
                                             2013     2012 
                                            GBP'000  GBP'000 
 
Investments in loan stock                       867      417 
Investments in liquidity funds                1,003      380 
Cash and cash equivalents                     1,198    3,523 
Interest, dividends and other receivables       563       10 
                                              3,631    4,330 
 
 
   Credit risk in respect of loan stock is managed with a similar approach 
as described under 'market risks' above. 
 
   Credit risk in respect of the investment in liquidity funds is minimised 
by investing in AAA-rated funds. 
 
   Cash is mainly held by HSBC Bank plc and Natwest Bank plc which are AA- 
and AA rated financial institutions respectively. Consequently, the 
Directors consider that the risk profile associated with cash deposits 
is low. 
 
   Liquidity risk 
 
   Liquidity risk is the risk that the Company encounters difficulties in 
meeting obligations associated with its financial liabilities. As the 
Company only ever has a low level of creditors and no borrowings, the 
Board believes that the Company's exposure to liquidity risk is minimal, 
given the current large cash balance. 
 
   5. Post balance sheet events 
 
   Two VCT qualifying investments totalling GBP1.05 million were completed 
after the year end. 
 
   On 21 February 2013, an investment of GBP550,000, comprising GBP55,000 
in ordinary shares and GBP495,000 in loan stock, was made in Fjordnet 
Limited. 
 
   Fjordnet was acquired by Accenture Holdings B.V., a subsidiary of 
Accenture (NYSE: ACN) on 22 May 2013. This resulted in the full 
repayment of the loan notes and generated a small profit for the 
Company. 
 
   On 22 May 2013, an investment of GBP500,000, comprising GBP150,000 in 
ordinary shares and GBP350,000 in loan stock, was made in Campden Media. 
 
   Announcement based on audited accounts 
 
   The financial information set out in this announcement does not 
constitute the Company's statutory financial statements in accordance 
with section 434 Companies Act 2006 for the year ended 31 January 2013, 
but has been extracted from the statutory financial statements for the 
year ended 31 January 2013, which were approved by the Board of 
Directors on 28 May 2013 and will be delivered to the Registrar of 
Companies following the Company's Annual General Meeting.  The 
Independent Auditor's Report on those financial statements was 
unqualified and did not contain any emphasis of matter nor statements 
under s 498(2) and (3) of the Companies Act 2006. 
 
   The statutory accounts for the period ended 31 January 2012 have been 
delivered to the Registrar of Companies and received an Independent 
Auditors report which was unqualified and did not contain any emphasis 
of matter nor statements under S237(2) or (3) of the Companies Act 1985. 
 
   A copy of the full annual report and financial statements for the year 
ended 31 January 2013 will be printed and posted to shareholders 
shortly. Copies will also be available to the public at the registered 
office of the Company at 39 Earlham Street, London, WC2H 9LT and will be 
available for download from www.provenvcts.co.uk. 
 
   -End 
 
 
 
 
   This announcement is distributed by Thomson Reuters on behalf of Thomson 
Reuters clients. 
 
   The owner of this announcement warrants that: 
 
   (i) the releases contained herein are protected by copyright and other 
applicable laws; and 
 
   (ii) they are solely responsible for the content, accuracy and 
originality of the 
 
   information contained therein. 
 
   Source: ProVen Planned Exit VCT plc via Thomson Reuters ONE 
 
   HUG#1704610