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Share Name | Share Symbol | Market | Type |
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Goldmining Inc | TG:BSR | Tradegate | Ordinary Share |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
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0.002 | 0.25% | 0.793 | 0.785 | 0.80 | 0.812 | 0.805 | 0.805 | 5,492 | 22:50:01 |
RNS Number:3552J British Smaller Tech Cos VCT PLC 28 March 2003 BRITISH SMALLER TECHNOLOGY COMPANIES VCT PLC UNAUDITED PRELIMINARY RESULTS FOR THE YEAR ENDED 31 DECEMBER 2002 Total amount invested reaches #10.7m Follow-on funding close to #1m made at more favourable prices Potential for significant capital appreciation British Smaller Technology Companies VCT plc ("the Company"), the venture capital trust specialising in growing smaller technology companies, today announces its unaudited preliminary results for the 12 months to 31 December 2002. Financial highlights Unaudited Audited 2002 2001 Income #126,000 #229,000 Net revenue return before and after tax #(394,000) #(244,000) Total return per share (27.70)p (20.14)p Net assets #7.23m #11.02m NAV per share 52.6p 80.2p Commenting on the results, the Chairman, Sir Andrew Hugh Smith, said against the background where falls in the TechMark All Share index and NASDAQ during the period were considerably more than 30%, the Company had recorded a 34% decline in net asset value from 80.2p per share to 52.6p per share. He said although "this was disappointing" for directors, managers and shareholders, he remained confident that many of the companies in the portfolio continue to offer the potential for "very substantial growth in better economic conditions." Investments The Company is concentrating available funds on those investments that are seen to have the greatest potential. This policy resulted in investments of #932,000 in the year in ten portfolio companies. In those cases where the institutions were unwilling to invest further, this inevitably led to the companies ceasing to trade. There was one failure during the year, Optical Micro Devices Limited, and since the year end LANergy Limited has ceased to trade. Although downward valuation adjustments have been made in some businesses to reflect market sentiment for the sector and continuing restricted exit opportunities, others have made good progress and their products are achieving significant levels of market progress. The Chairman commented that these companies "cannot easily be valued upward at present as there is no real independent basis on which to do so." The Company remains comfortably ahead of the qualifying investment targets set out in the venture capital trust legislation. Phil Cammerman, Managing Director of Yorkshire Fund Managers Limited, the Company's Investment Adviser, said that as he predicted in last year's report, 2002 was another difficult year. He commented that obtaining market acceptance of new products proved difficult for early stage businesses and fund raising had proved to be extremely challenging. This meant that companies had to keep tight control on costs and maximise sales and marketing whilst reducing and bringing forward break even points. He said that there was the risk in an early stage portfolio like this, that companies either failed to gain a foothold in their market or ran out of funds before they achieved that point. Nevertheless, he added "It is encouraging that since last year the combined percentage of companies having achieved either early or mass-market adoption has increased from 28% in 2001 to 63% in 2002. This positive progress along the value chain is all the more pleasing given the prevailing market conditions." Whilst 2002 has been difficult, the risks associated with the remaining companies should diminish as the profile of the portfolio matures. He said that Yorkshire Fund Managers would continue to work to improve performance and generate exits although these were expected to be difficult in the current uncertain environment. "Our priorities for this year, therefore, will be to ensure that companies are robustly funded, focused on the transition to break-even and alert to potential exit opportunities," he said. Financial Results and Dividend The total return for the year was a loss of 27.7p per share, reducing net asset value per share to 52.6p. No dividend can be paid. Shareholder Relations The Chairman remarked on two initiatives to improve the liquidity of the Company's shares. Firstly, net asset values are being announced quarterly to improve information and to stimulate greater interest in the Company. Secondly, the Board is recommending the adoption of proposals at the Annual General Meeting, scheduled for May 2003, to enable the Company to buy back shares and to facilitate future distributions. In addition, and to improve communication with Shareholders, Yorkshire Fund Managers hosted the first of a series of presentations to Shareholders on 6 March 2003 in London. Further presentations are planned for London, Leeds, Birmingham and Edinburgh. Outlook Commenting on the Company's prospects, Sir Andrew said that the economic climate, both in the UK and internationally, remained depressed and fragile and the timing of any improvement was uncertain. He added that he "remains confident that there is considerable upside in a number of investee companies" and that "there remains the opportunity for substantial capital growth." For further information, please contact: Alan Davies/Michael White Yorkshire Fund Managers Limited Tel: 0113 294 5000 Neil Baldwin/Keith Williams Brewin Dolphin Securities Limited Tel: 0113 241 0130 CHAIRMAN'S STATEMENT The economic climate has remained difficult throughout the period under review and this has been fully reflected in financial markets where falls, since the peak, have been considerably more than 30% and in the case of markets dominated by technology businesses, such as the TechMark All Share index and NASDAQ, even more. Against this background, we have been obliged to record a 34% decline in the net asset value of your Company. This is disappointing for all of us, directors, managers and shareholders alike. Nevertheless, we remain confident that many of the companies in our portfolio continue to offer the potential for very substantial growth in better economic conditions. Investments I have mentioned in previous statements that surplus liquid resources are now being reserved for follow-on investments within the current portfolio to support companies that require additional funding to progress their product toward market acceptance. Not all companies seeking further investment can, or will, be supported. We are concentrating available funds on those investments that are seen to have the highest potential. In those cases where we, and other institutions, are unwilling to invest this will inevitably lead to some corporate failure. In the first half of the year, one company, Optical Micro Devices Limited, ceased to trade and since the year end, LANergy Limited has been placed into Administrative Receivership. In the year as a whole, a further five companies were fully provided for, although they remain operational. Downward valuation adjustments have also been taken where additional funding rounds have been completed at lower valuations to the previous one reflecting the market sentiment for the sector and the continuing restricted exit opportunities. Against this, those companies in the portfolio that are making good progress and whose products are beginning to achieve significant levels of market acceptance cannot easily be valued upward at present as there is no real independent basis on which to do so. Currently, there are three investments valued above cost on the basis of third party arms-length valuations. Your Board remains encouraged by the potential of a number of other companies within the portfolio. A total of #932,000 was invested as follow-on funding in ten companies during the year. There were no realisations. I am pleased to report that your Company remains comfortably ahead of the qualifying investment targets set out in the venture capital trust legislation. Financial Results The nature of the investment policy set out in the original Prospectus and the fact that the portfolio is now substantially invested in these unquoted companies means that revenue income is expected to remain at a low level for the immediate future with the emphasis on achieving capital growth in the underlying portfolio. The revenue loss for the year was #394,000, equating to a loss per ordinary share of 2.87p. The loss on capital account was #3.4m bringing the total loss per share to 27.7p for the year as a whole. No dividend can be paid. The net asset value at 31 December 2002 was 52.6p per Ordinary share. The value of Gilt investments, after realisations, increased by a net #26,000 in the year but was heavily offset by the fall in the value of the unquoted portfolio as mentioned above. Shareholder Relations Your Board and its Investment Adviser have continued to explore ways in which liquidity in your Company's shares can be improved. In line with a number of other VCT companies, we have begun to announce net asset values to the market quarterly in an attempt to both improve information and to stimulate interest in the sector. We also continue to talk to our brokers and market makers to explore other opportunities in creating better liquidity. Further to improving liquidity for shareholders, your Board is recommending proposals to enable the buying in by the Company of its own shares and to facilitate future distributions. This will involve the cancellation of the Company's existing share premium account and the creation, in its place, of a special distributable reserve to be used for this purpose. Special resolutions to implement this will be proposed at the forthcoming Annual General Meeting. As a means of extending our communication with our Shareholders your Board's Investment adviser, Yorkshire Fund Managers Limited, is hosting a series of presentations to Shareholders of all three VCTs under its management. The first of these was held on 6 March in London and was very well attended. David Cartwright of PricewaterhouseCoopers LLP, the VCT status adviser to the Company, updated attendees on current and proposed VCT legislation and there were presentations from two unquoted companies that have received VCT backing through Yorkshire Fund Managers. Further presentations in London, Leeds, Birmingham and Edinburgh are planned. Warrants A notice was sent to Shareholders and Warrantholders on 20 February 2003 alerting them to the dates on which the Warrants can be exercised in this current year. This is the second year in which Warrants have been exercisable. Unexercised Warrants can be exercised on these same dates next year, after which time they will lapse. Outlook The economic climate, both in the UK and internationally, remains depressed and fragile. The timing of the end to the bear market will inevitably depend upon the length of the current uncertainty and the depth of damage done to confidence in the meantime. Despite the fall in valuation of your Company's portfolio your Board and its Investment Adviser remain confident that there is considerable upside in a number of investee companies that is yet to be seen. Although further corporate failure cannot be discounted in the general market conditions there remains the opportunity for substantial capital growth. Sir Andrew Hugh Smith Chairman Unaudited Statement of Total Return (incorporating the Revenue Account) for the year ended 31 December 2002 Unaudited Year ended Audited Year ended 31 December 2002 31 December 2001 Notes Revenue Capital Total Revenue Capital Total #000 #000 #000 #000 #000 #000 Net losses on investments - (3,281) (3,281) - (2,391) (2,391) Income 126 - 126 229 - 229 Investment advisory fee (304) (131) (435) (304) (131) (435) Other expenses (216) - (216) (169) - (169) ------- ------- ------- -------- -------- -------- Net return on ordinary activities before taxation (394) (3,412) (3,806) ( 244) (2,522) (2,766) Tax on ordinary activities 2 - - - - - - -------- --------- ------- -------- -------- -------- Net return on ordinary activities after taxation (394) (3,412) (3,806) (244) (2,522) (2,766) Dividends in respect of equity 3 - - - - - - shares -------- -------- ------- -------- -------- -------- Transfer from reserves (394) (3,412) (3,806) (244) (2,522) (2,766) ===== ===== ==== ===== ===== ===== Return per Ordinary share Basic and diluted 4 (2.87)p (24.83)p (27.70)p (1.78)p (18.36)p (20.14)p Notes The revenue column of this statement is the profit and loss account of the Company. All activity has arisen from continuing operations. There is no difference between the net revenue return on ordinary activities before taxation and the transfer from revenue reserves in either year and their historic cost equivalents. Unaudited Balance Sheet at 31 December 2002 Unaudited Audited Note 2002 2001 #000 #000 Fixed Assets Investment portfolio 5,867 8,242 Current Assets Investments 1,287 2,571 Debtors 42 23 Cash 71 215 -------- -------- 1,400 2,809 Creditors: amounts payable within one year (39) (34) -------- -------- Net Current Assets 1,361 2,775 -------- -------- Total Net Assets 7,228 11,017 ===== ===== Capital and Reserves Called-up share capital 1,375 1,373 Share premium account 11,351 11,336 Capital redemption reserve 2 2 Capital reserve Realised (563) (499) Unrealised (4,779) (1,431) -------- -------- (5,342) (1,930) Warrant reserve 336 338 Other reserve 2 - Revenue reserve (496) (102) ------- -------- Equity shareholders' funds 7,228 11,017 ===== ===== Net asset value per Ordinary share 5 52.6p 80.2p ===== ===== Unaudited Cash Flow Statement for the year ended 31 December 2002 Unaudited Audited Year ended Year ended 31 December 2002 31 December 2001 #000 #000 Net cash outflow from operating activities (539) (296) -------- -------- Taxation Tax repayments received - 34 -------- -------- Investing activities Purchase of investments (932) (4,101) -------- -------- Net cash outflow before management of liquid resources and financing (1,471) (4,363) -------- -------- Management of liquid resources Proceeds from the sale of fixed interest government stocks 1,310 3,241 -------- -------- Financing Issue of Ordinary shares on exercise of warrants 17 - Purchase of own shares - (20) -------- -------- Net cash inflow (outflow) from financing 17 (20) -------- -------- Decrease in cash in the year (144) (1,142) ===== ===== Notes to Financial Statements for the year ended 31 December 2002 1. Basis of Reporting This preliminary announcement, which has been prepared on a basis consistent with the previous year, does not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985. This announcement has been agreed with the Company's auditors for release. The information for the year ended 31 December 2001 is an extract from the statutory accounts to that date which have been delivered to the Registrar of Companies. Those accounts included an audit report which was unqualified and which did not contain a statement under Section 237(2) or (3) of the Companies Act 1985. The statutory accounts for the year ended 31 December 2002, upon which the auditors have still to report, will be delivered to the Registrar following the Company's annual general meeting. 2. Taxation Charge (Credit) Year ended 31 December 2002 Year ended 31 December 2001 Revenue Capital Total Revenue Capital Total #000 #000 #000 #000 #000 #000 Corporation tax payable at 19.25% - - - - - - (2001: 20%) ------ ------ ------ ------ ------ ------ 3. Dividends There is no proposed dividend in the year (2001: #nil). 4. Revenue Return per Ordinary Share The basic revenue return per Ordinary share is based on net revenue loss from ordinary activities after tax of #394,000 (2001: #244,000) and 13,742,000 (2001: 13,734,000) shares being the weighted average number of shares in issue during the year. The Company has no securities that would have a dilutive effect in either year and hence basic and diluted return per share are the same. 5. Net Asset Value per Ordinary Share The net asset value per Ordinary share is calculated on attributable assets of #7,228,000 (2001: #11,017,000) and 13,745,842 (2001: 13,728,842) shares in issue at the year end. 6. Annual General Meeting Copies of the full financial statements for the period ended 31 December 2002 will be available to the public at the registered office of the Company at Saint Martins House, 210-212 Chapeltown Road, Leeds, LS7 4HZ thereafter. The Company's AGM is due to be held at 4p.m. on 15 May 2003 at the above address. This information is provided by RNS The company news service from the London Stock Exchange END FR SESFLASDSESD
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