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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Albion Enterprise Vct Plc | LSE:AAEV | London | Ordinary Share | GB00B1G3LR35 | 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% | 119.50 | 118.00 | 121.00 | 119.50 | 119.50 | 119.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Investors, Nec | 5.74M | 2.77M | 0.0274 | 43.61 | 120.55M |
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Albion Enterprise VCT PLC
LEI Code 213800OVSRDHRJBMO720
As required by the UK Listing Authority's Disclosure and Transparency
Rule 4.2, Albion Enterprise VCT PLC today makes public its information
relating to the Half-yearly Financial Report (which is unaudited) for
the six months to 30 September 2017. This announcement was approved by
the Board of Directors on 4 December 2017.
The full Half-yearly Financial Report (which is unaudited) for the
period to 30 September 2017, will shortly be sent to shareholders.
Copies of the full Half-yearly Financial Report will be shown via the
Albion Capital Group LLP website by clicking
www.albion.capital/funds/AAEV/30Sep2017.pdf.
Investment objective
The investment objective of Albion Enterprise VCT PLC ("the Company") is
to provide investors with a regular and predictable source of income,
combined with the prospect of longer term capital growth.
The Company's investment portfolio is structured to provide a balance
between income and capital growth for the longer term. Stock specific
risk will be reduced by the Company's policy of holding a diversified
portfolio of Qualifying Investments.
Under its Articles of Association, the Company's maximum exposure in
relation to gearing is restricted to 10 per cent. of its adjusted share
capital and reserves.
The Company can, prior to investing in VCT qualifying assets, invest in
cash deposits, in floating rate notes or similar instruments with banks
or other financial institutions with credit ratings, assigned by
international credit agencies, of A or better (on acquisition) or up to
10 per cent. of its assets, at the time of investment, in liquid
open-ended equity funds providing income and capital equity exposure
(where it is considered economic to do so).
Financial calendar
Record date for second dividend 9 February 2018
Payment date for second dividend 28 February 2018
Financial year end 31 March
Financial highlights
Unaudited six Audited
Unaudited six months ended months ended year ended
30 September 2017 30 September 2016 31 March 2017
(pence per share) (pence per share) (pence per share)
Dividends
paid 2.50 2.50 5.00
Revenue
return - 0.53 0.64
Capital
return 2.34 2.90 10.23
Net asset
value 101.62 97.39 101.79
Total shareholder return to 30 September 2017: (pence per share)
Dividends paid during the year ended:
31 March 2008 0.70
31 March 2009 1.65
31 March 2010 2.00
31 March 2011 3.00
31 March 2012 3.00
31 March 2013 3.50
31 March 2014 5.00
31 March 2015 5.00
31 March 2016 5.00
31 March 2017 5.00
Dividends paid in the six months to 30 September 2017 2.50
Total dividends paid to 30 September 2017 36.35
Net asset value as at 30 September 2017 101.62
Total shareholder return to 30 September 2017 137.97
In addition to the dividends summarised above, the Directors have
declared a second dividend of 2.50 pence per share, payable on 28
February 2018 to shareholders on the register on 9 February 2018.
Notes
-- The dividend of 0.70 pence per share paid during the period ended 31
March 2008 and first dividend of 0.40 pence per share paid during the
year ended 31 March 2009 were paid to shareholders who subscribed in the
2006/2007 offer only.
-- Dividends paid by the Company are normally free of income tax for
individuals ages 18 or over. Investors should not disclose any income
they received from a VCT on their tax return unless they have acquired
more than GBP200,000 of VCT shares in a tax year.
-- The net asset value of the Company is not its share price as quoted on
the official list of the London Stock Exchange. The share price of the
Company can be accessed via a link on the Company's webpage at
www.albion.capital/funds/AAEV under 'Trust Information'.
-- Investors are reminded that it is common for shares in VCTs to trade at a
discount to their net asset value as tax reliefs are only obtainable on
new subscription.
Interim management report
Introduction
I am pleased to report a total return of 2.3 pence per share for the six
months to 30 September 2017 (30 September 2016: 3.4 pence per share).
These results demonstrate continued positive developments within our
investment portfolio.
Investment performance and progress
During the period, some GBP4.0 million was invested in existing and new
companies, including GBP950,000 in MPP Global Solutions, which provides
a digital subscription management platform, GBP545,000 in G.Network
Communications, which is rolling out a fibre optic network in central
London, and GBP100,000 in Locum's Nest, which provides a technology
solution for the management of locum doctors for the NHS. In addition,
GBP1.2 million was invested in Egress Software Technologies, to fund
further growth, while GBP482,000 was invested in Oviva to fund its
expansion, particularly in the UK.
During the period our holding in Hilson Moran was sold, realising
proceeds of GBP1.47 million and resulting in a three times return on the
total investment.
Particularly good progress in the year was achieved by Grapeshot, which
has now moved sharply into profit and which is currently growing in
excess of 150% per annum. In addition, the annual professional valuation
of Radnor House School (Holdings) increased, as pupil numbers at our
Radnor House Sevenoaks School continue to grow.
Aridhia Informatics valuation was reduced, following slower than
anticipated growth. The write-down of Egress Software Technologies
valuation was technical in nature, reflecting a slightly lower valuation
than anticipated on our recent investment; the company continues to show
strong growth.
Results and dividends
On 30 September 2017, the net asset value was GBP52.5 million or 101.62
pence per share compared to GBP52.5 million or 101.79 pence per share on
31 March 2017. The total return before taxation was GBP1.2 million
compared to GBP1.6 million for the six months to 30 September 2016. In
line with the annual dividend target of 5 pence per share, the Directors
declare a second dividend for the year of 2.50 pence per share payable
on 28 February 2018 to shareholders on the register on 9 February 2018.
Patient Capital Review
The Patient Capital Review has been completed and the 2017 Autumn Budget
has now been delivered. Whilst being strongly supportive of VCTs, the
Budget has introduced a number of measures designed to re-direct
investment towards higher growth innovative businesses. Whilst not
fundamentally changing the way that we invest, your Board and the
Manager are currently reviewing the implications of these measures, and
will reflect on whether your Company's stated investment policy needs to
be amended at next year's Annual General Meeting.
Risks & uncertainties
The outlook for the UK and global economies continues to be the key risk
affecting the Company, despite continued growth in the UK. Investment
risk is mitigated in a number of ways, including our policy that the
portfolio should be balanced across sectors and stages of investment.
Other principal risks and uncertainties are detailed in note 13 below.
Share buy-backs
It remains the Board's policy to buy back shares in the market, subject
to the overall constraint that such purchases are in the Company's
interest, including the maintenance of sufficient resources for
investment in new and existing portfolio companies and the continued
payment of dividends to shareholders. It is the Board's intention for
such buy-backs to be in the region of a 5 per cent. discount to net
asset value so far as market conditions and liquidity permit.
Transactions with the Manager
Details of the transactions that took place with the Manager during the
period can be found in note 5.
There are no related party transactions or balances that require
disclosure.
Albion VCTs Prospectus Top Up Offers 2017/18
Your Board, in conjunction with the boards of other VCTs managed by
Albion Capital Group LLP, launched a prospectus top up offer of new
Ordinary shares on 6 September 2017 with an aim to raise circa GBP6
million out of a target of GBP32 million in aggregate that the Albion
VCTs are seeking to raise. The proceeds will be used to provide further
resources at a time when a number of attractive investment opportunities
are being seen. Details of the first allotment on 17 November 2017 of
GBP3.67 million are shown in note 10.
Outlook
We see the portfolio as being well balanced across a variety of growth
sectors and with a number of businesses having the capability of
significant further increase in value.
Maxwell Packe
Chairman
4 December 2017
Responsibility statement
The Directors, Maxwell Packe, Lady Balfour of Burleigh, Lord St John of
Bletso and Patrick Reeve, are responsible for preparing the Half-yearly
Financial Report. In preparing these condensed Financial Statements for
the period to 30 September 2017 we, the Directors of the Company,
confirm that to the best of our knowledge:
(a) the condensed set of Financial Statements, which has been
prepared in accordance with Financial Reporting Standard 104 "Interim
Financial Reporting", give a true and fair view of the assets,
liabilities, financial position and profit and loss of the Company as
required by DTR 4.2.4R;
(b) the interim management report includes a fair review of the
information required by DTR 4.2.7R (indication of important events
during the first six months and description of principal risks and
uncertainties for the remaining six months of the year); and
(c) the interim management report includes a fair review of the
information required by DTR 4.2.8R (disclosure of related parties'
transactions and changes therein).
This Half-yearly Financial Report has not been audited or reviewed by
the Auditor.
By order of the Board
Maxwell Packe
Chairman
4 December 2017
Portfolio of investments
The following is a summary of investments as at 30 September 2017:
Cumulative movement Change in
Portfolio % voting Cost in value Value value for the period(*)
company rights GBP'000 GBP'000 GBP'000 GBP'000
Radnor House
School
(Holdings)
Limited 9.8 3,128 3,467 6,595 668
Egress Software
Technologies
Limited 10.9 2,052 2,588 4,640 (481)
Grapeshot
Limited 5.1 1,026 2,130 3,156 990
Bravo Inns II
Limited 13.1 2,150 372 2,522 90
Mirada Medical
Limited 15.1 1,055 1,253 2,308 (9)
Proveca Limited 9.6 905 1,018 1,923 24
Regenerco
Renewable
Energy
Limited 12.5 1,261 611 1,872 111
Earnside Energy
Limited 8.7 1,394 273 1,667 (27)
Alto Prodotto
Wind Limited 11.1 987 544 1,531 5
The Street by
Street Solar
Programme
Limited 8.6 891 560 1,451 68
Greenenerco
Limited 28.6 942 482 1,424 12
Process Systems
Enterprise
Limited 4.1 406 954 1,360 9
DySIS Medical
Limited 10.0 2,509 (1,350) 1,159 (11)
Zift Channel
Solutions
Inc. 2.5 1,053 14 1,067 14
MPP Global
Solutions
Limited 3.2 950 - 950 -
Oviva AG 3.7 642 160 802 161
memsstar
Limited 8.8 373 326 699 264
Convertr Media
Limited 6.3 700 (46) 654 (46)
MyMeds&Me
Limited 3.4 418 219 637 13
Aridhia
Informatics
Limited 6.6 1,090 (536) 554 (394)
G.Network
Communications
Limited 9.1 545 - 545 -
Black Swan Data
Limited 1.6 538 - 538 -
OmPrompt
Holdings
Limited 7.4 682 (151) 531 (1)
Bravo Inns
Limited 8.4 755 (263) 492 26
Oxsensis
Limited 3.3 625 (253) 372 110
Mi-Pay Group
plc 6.3 1,504 (1,162) 342 (26)
Cisiv Limited 8.6 663 (322) 341 1
Abcodia Limited 5.6 764 (450) 314 (44)
Quantexa
Limited 2.7 303 - 303 -
Secured by
Design
Limited 1.9 280 1 281 1
AVESI Limited 5.5 180 73 253 14
Panaseer
Limited 2.0 180 47 227 -
Sandcroft
Avenue Limited
(PayAsUGym.com
) 1.8 160 (21) 139 -
Dickson
Financial
Services
Limited 8.4 84 34 118 (4)
Locum's Nest
Limited 2.2 100 - 100 -
MHS 1 Limited 1.2 83 (1) 82 -
InCrowd Sports
Limited 1.5 66 - 66 -
Beddlestead
Limited 10.0 20 - 20 -
Total fixed
asset
investments 31,464 10,571 42,035 1,538
*As adjusted for additions and disposals during the period.
Total change in value of investments for the period 1,538
Movement in loan stock accrued interest (3)
Unrealised gains sub-total 1,535
Realised gains in current period 259
Total gains on investments as per Income statement 1,794
Opening Total Gain/(loss) on
carrying Disposal realised opening
Cost value proceeds gain/(loss) value
Fixed asset realisations GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Disposals:
Hilson Moran Holdings Limited 201 1,079 1,471 1,270 392
Relayware Limited (merger with Zift Channel Solutions
Inc.) 913 911 901 (12) (10)
Loan stock repayments/restructuring:
Oxsensis Limited (conversion of loan stock to equity) 85 117 122 37 5
memsstar Limited 11 189 100 89 (89)
Greenenerco Limited 17 25 25 8 -
Alto Prodotto Wind Limited 2 2 2 - -
Escrow adjustment - - (39) (39) (39)
Total realisations 1,229 2,323 2,582 1,353 259
Condensed income statement
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2017 30 September 2016 31 March 2017
Revenue Capital Revenue Capital Revenue Capital
Note GBP'000 GBP'000 Total GBP'000 GBP'000 GBP'000 Total GBP'000 GBP'000 GBP'000 Total GBP'000
Gains on
investments 3 - 1,794 1,794 - 1,697 1,697 - 5,790 5,790
Investment income 4 316 - 316 560 - 560 939 - 939
Investment
management fees 5 (164) (492) (656) (139) (419) (558) (292) (875) (1,167)
Performance incentive fee 5 (31) (93) (124) - - - (64) (191) (255)
Other expenses (120) - (120) (116) - (116) (227) - (227)
Return on
ordinary activities before taxation 1 1,209 1,210 305 1,278 1,583 356 4,724 5,080
Tax (charge)/credit on ordinary activities - - - (59) 59 - (57) 57 -
Return and total comprehensive income attributable
to shareholders 1 1,209 1,210 246 1,337 1,583 299 4,781 5,080
Basic and diluted return per share (pence)* 7 - 2.34 2.34 0.53 2.90 3.43 0.64 10.23 10.87
* excluding treasury shares
Comparative figures have been extracted from the unaudited Half-yearly
Financial Report for the six months ended 30 September 2016 and the
audited statutory accounts for the year ended 31 March 2017.
The accompanying notes form an integral part of this Half-yearly
Financial Report.
The total column of this Condensed income statement represents the
profit and loss account of the Company. The supplementary revenue and
capital columns have been prepared in accordance with The Association of
Investment Companies' Statement of Recommended Practice.
Condensed balance sheet
Audited
Unaudited Unaudited 31 March
30 September 2017 30 September 2016 2017
Note GBP'000 GBP'000 GBP'000
Fixed asset
investments 42,035 35,719 37,775
Current assets
Trade and other
receivables less
than one year 1,673 855 232
Cash and cash
equivalents 9,385 8,629 15,121
11,058 9,484 15,353
Total assets 53,093 45,203 53,128
Payables: amounts
falling due within
one year
Trade and other
payables less than
one year (545) (341) (670)
Total assets less
current
liabilities 52,548 44,862 52,458
Equity attributable
to equity holders
Called up share
capital 8 585 521 580
Share premium 23,706 17,564 23,225
Capital redemption
reserve 104 104 104
Unrealised capital
reserve 10,351 8,070 9,910
Realised capital
reserve 2,052 (320) 1,284
Other distributable
reserve 15,750 18,923 17,355
Total equity
shareholders'
funds 52,548 44,862 52,458
Basic and diluted
net asset value per
share (pence)* 101.62 97.39 101.79
* excluding treasury shares
Comparative figures have been extracted from the unaudited Half-yearly
Financial Report for the six months ended 30 September 2016 and the
audited statutory accounts for the year ended 31 March 2017.
The accompanying notes form an integral part of this Half-yearly
Financial Report.
These Financial Statements were approved by the Board of Directors, and
authorised for issue on 4 December 2017 and were signed on its behalf by
Maxwell Packe
Chairman
Company number: 05990732
Condensed statement of changes in equity
Called up Unrealised Realised
share Share capital capital Other distributable
capital premium Capital redemption reserve reserve reserve* reserve* Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
As at 1 April 2017 580 23,225 104 9,910 1,284 17,355 52,458
Return/(loss) and total comprehensive income for the
period - - - 1,535 (326) 1 1,210
Transfer of previously unrealised gains on disposal
of investments - - - (1,094) 1,094 - -
Issue of equity 5 491 - - - - 496
Cost of issue of equity - (10) - - - - (10)
Purchase of shares for treasury - - - - - (312) (312)
Dividends paid - - - - - (1,294) (1,294)
As at 30 September 2017 585 23,706 104 10,351 2,052 15,750 52,548
As at 1 April 2016 518 17,285 104 6,389 24 20,150 44,470
Return/(loss) and total comprehensive income for the
period - - - 1,702 (365) 246 1,583
Transfer of previously unrealised gains on disposal
of investments - - - (21) 21 - -
Issue of equity 3 283 - - - - 286
Cost of issue of equity - (4) - - - - (4)
Purchase of shares for treasury - - - - - (317) (317)
Dividends paid - - - - - (1,156) (1,156)
As at 30 September 2016 521 17,564 104 8,070 (320) 18,923 44,862
As at 1 April 2016 518 17,285 104 6,389 24 20,150 44,470
Return/(loss) and total comprehensive income for the
year - - - 5,016 (235) 299 5,080
Transfer of previously unrealised gains on disposal
of investments - - - (1,495) 1,495 - -
Issue of equity 62 6,106 - - - - 6,168
Cost of issue of equity - (166) - - - - (166)
Purchase of shares for treasury - - - - - (689) (689)
Dividends paid - - - - - (2,405) (2,405)
As at 31 March 2017 580 23,225 104 9,910 1,284 17,355 52,458
* These reserves amount to GBP17,802,000 (30 September 2016:
GBP18,603,000; 31 March 2017: GBP18,639,000) which is considered
distributable.
Condensed statement of cash flows
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2017 30 September 2016 31 March 2017
GBP'000 GBP'000 GBP'000
Cash flow from operating
activities
Investment income received 283 442 733
Dividend income received 28 10 70
Deposit interest received 2 50 76
Investment management fees
paid (655) (556) (1,117)
Performance incentive fee
paid (255) - -
Other cash payments (147) (128) (226)
Corporation tax paid - - (11)
Net cash flow from operating
activities (744) (182) (475)
Cash flow from investing
activities
Purchase of fixed asset
investments (4,023) (2,135) (3,375)
Disposal of fixed asset
investments 128 526 4,424
Net cash flow from investing
activities (3,895) (1,609) 1,049
Cash flow from financing
activities
Issue of share capital 287 2,743 8,271
Cost of issue of equity (2) (5) (1)
Dividends paid (1,094) (981) (2,037)
Purchase of own shares
(including costs) (288) (317) (666)
Net cash flow from financing
activities (1,097) 1,440 5,567
(Decrease)/increase in cash
and cash equivalents (5,736) (351) 6,141
Cash and cash equivalents at
start of period 15,121 8,980 8,980
Cash and cash equivalents at
end of period 9,385 8,629 15,121
Cash and cash equivalents
comprise
Cash at bank and in hand 9,385 8,629 15,121
Cash equivalents - - -
Total cash and cash
equivalents 9,385 8,629 15,121
Notes to the condensed Financial Statements
1. Basis of preparation
The condensed Financial Statements have been prepared in accordance with
the historical cost convention, modified to include the revaluation of
investments, in accordance with applicable United Kingdom law and
accounting standards, including Financial Reporting Standard 102 ("FRS
102"), Financial Reporting Standard 104 - Interim Financial Reporting
("FRS 104"), and with the 2014 Statement of Recommended Practice
"Financial Statements of Investment Trust Companies and Venture Capital
Trusts" ("SORP") issued by The Association of Investment Companies
("AIC").
The preparation of the Financial Statements requires management to make
judgements and estimates that affect the application of policies and
reported amounts of assets, liabilities, income and expenses. The most
critical estimates and judgements relate to the determination of
carrying value of investments at fair value through profit and loss
("FVTPL"). The Company values investments by following the IPEVCV
Guidelines and further detail on the valuation techniques used are
outlined in note 2 below.
The Half-yearly Financial Report has not been audited, nor has it been
reviewed by the auditor pursuant to the FRC's guidance on Review of
interim financial information.
2. Accounting policies
Fixed asset investments
The Company's business is investing in financial assets with a view to
profiting from their total return in the form of income and capital
growth. This portfolio of financial assets is managed and its
performance evaluated on a fair value basis, in accordance with a
documented investment policy, and information about the portfolio is
provided internally on that basis to the Board.
In accordance with the requirements of FRS 102, those undertakings in
which the Company holds more than 20 per cent. of the equity as part of
an investment portfolio are not accounted for using the equity method.
In these circumstances the investment is measured at FVTPL.
Upon initial recognition (using trade date accounting) investments are
classified by the Company as FVTPL and are included at their initial
fair value, which is cost (excluding expenses incidental to the
acquisition which are written off to the income statement).
Subsequently, the investments are valued at 'fair value', which is
measured as follows:
-- Investments listed on recognised exchanges are valued at their bid prices
at the end of the accounting period or otherwise at fair value based on
published price quotations;
-- Unquoted investments, where there is not an active market, are valued
using an appropriate valuation technique in accordance with the IPEVCV
Guidelines. Indicators of fair value are derived using established
methodologies including earnings multiples, the level of third party
offers received, prices of recent investment rounds, net assets and
industry valuation benchmarks. Where the Company has an investment in an
early stage enterprise, the price of a recent investment round is often
the most appropriate approach to determining fair value. In situations
where a period of time has elapsed since the date of the most recent
transaction, consideration is given to the circumstances of the portfolio
company since that date in determining fair value. This includes
consideration of whether there is any evidence of deterioration or strong
definable evidence of an increase in value. In the absence of these
indicators, the investment in question is valued at the amount reported
at the previous reporting date. Examples of events or changes that could
indicate a diminution include:
-- the performance and/or prospects of the underlying business are
significantly below the expectations on which the investment was
based;
-- a significant adverse change either in the portfolio company's
business or in the technological, market, economic, legal or
regulatory environment in which the business operates; or
-- market conditions have deteriorated, which may be indicated by a
fall in the share prices of quoted businesses operating in the
same or related sectors.
Investments are recognised as financial assets on legal completion of
the investment contract and are de-recognised on legal completion of the
sale of an investment.
Dividend income is not recognised as part of the fair value movement of
an investment, but is recognised separately as investment income through
the other distributable reserve when a share becomes ex-dividend.
Receivables and payables and cash are carried at amortised cost, in
accordance with FRS 102. There are no financial liabilities other than
payables.
Investment income
Equity income
Dividend income is included in revenue when the investment is quoted
ex-dividend.
Unquoted loan stock and other preferred income
Fixed returns on non-equity shares and debt securities are recognised
when the Company's right to receive payment and expected settlement is
established. Where interest is rolled up and/or payable at redemption
then it is recognised as income unless there is reasonable doubt as to
its receipt.
Bank interest income
Interest income is recognised on an accruals basis using the rate of
interest agreed with the bank.
Investment management fees and other expenses
All expenses have been accounted for on an accruals basis. Expenses are
charged through the other distributable reserve except the following
which are charged through the realised capital reserve:
-- 75 per cent. of management fees are allocated to realised capital
reserve. This is in line with the Board's expectation that over the long
term 75 per cent. of the Company's investment returns will be in the form
of capital gains; and
-- expenses which are incidental to the purchase or disposal of an
investment are charged through the realised capital reserve.
Performance incentive fee
Any performance incentive fee will be allocated between other
distributable and realised capital reserves based upon the proportion to
which the calculation of the fee is attributable to revenue and capital
returns.
Taxation
Taxation is applied on a current basis in accordance with FRS 102.
Current tax is tax payable (refundable) in respect of the taxable profit
(tax loss) for the current period or past reporting periods using the
tax rates and laws that have been enacted or substantively enacted at
the financial reporting date. Taxation associated with capital expenses
is applied in accordance with the SORP.
Deferred tax is provided in full on all timing differences at the
reporting date. Timing differences are differences between taxable
profits and total comprehensive income as stated in the financial
statements that arise from the inclusion of income and expenses in tax
assessments in periods different from those in which they are recognised
in the financial statements. As a VCT the Company has an exemption from
tax on capital gains. The Company intends to continue meeting the
conditions required to obtain approval as a VCT in the foreseeable
future. The Company therefore, should have no material deferred tax
timing differences arising in respect of the revaluation or disposal of
investments and the Company has not provided for any deferred tax.
Reserves
Share premium
This reserve accounts for the difference between the price paid for
shares and the nominal value of the share, less issue costs.
Capital redemption reserve
This reserve accounts for amounts by which the issued share capital is
diminished through the repurchase and cancellation of the Company's own
shares.
Unrealised capital reserve
Increases and decreases in the valuation of investments held at the year
end against cost are included in this reserve.
Realised capital reserve
The following are disclosed in this reserve:
-- gains and losses compared to cost on the realisation of investments, or
permanent diminutions in value;
-- expenses, together with the related taxation effect, charged in
accordance with the above policies; and
-- dividends paid to equity holders where paid out by capital.
Other distributable reserve
The special reserve, treasury share reserve and the revenue reserve were
combined in 2013 to form a single reserve named other distributable
reserve.
This reserve accounts for movements from the revenue column of the
Income statement, the payment of dividends, the buyback of shares and
other non-capital realised movements.
Dividends
Dividends by the Company are accounted for in the period in which the
dividend is paid or approved at the Annual General Meeting.
Segmental reporting
The Directors are of the opinion that the Company is engaged in a single
operating segment of business, being investment in equity or debt. The
Company invests in smaller companies principally based in the UK.
3. Gains on investments
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2017 30 September 2016 31 March 2017
GBP'000 GBP'000 GBP'000
Unrealised gains on
fixed asset
investments 1,535 1,702 5,016
Realised
gains/(losses) on
fixed asset
investments 259 (5) 774
1,794 1,697 5,790
4. Investment income
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2017 30 September 2016 31 March 2017
GBP'000 GBP'000 GBP'000
Income recognised on
investments
Interest from loans to
portfolio companies 286 499 800
Dividends 28 10 70
Bank deposit interest 2 51 69
316 560 939
All of the Company's income is derived from operations based in the
United Kingdom.
5. Investment management fees
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2017 30 September 2016 31 March 2017
GBP'000 GBP'000 GBP'000
Investment management
fee charged to
revenue 164 139 292
Investment management
fee charged to
capital 492 419 875
Performance incentive
fee charged to
revenue 31 - 64
Performance incentive
fee charged to
capital 93 - 191
780 558 1,422
Further details of the Management agreement under which the investment
management fee and performance incentive fee are paid is given in the
Strategic report on pages 11 and 12 of the Annual Report and Financial
Statements for the year ended 31 March 2017.
During the period, services of a total value of GBP656,000 (30 September
2016: GBP558,000; 31 March 2017: GBP1,167,000) were purchased by the
Company from Albion Capital Group LLP. At the financial period end, the
amount due to Albion Capital Group LLP in respect of these services
disclosed within payables was GBP328,000 (30 September 2016: GBP280,000;
31 March 2017: GBP328,000). For the period to 30 September 2017, a
provisional performance incentive fee of GBP124,000 has been accrued,
however any performance incentive fee is calculated and only payable
based on year end results (30 September 2016: nil: 31 March 2017:
GBP255,000).
Patrick Reeve is the Managing Partner of the Manager, Albion Capital
Group LLP. During the period, the Company was charged GBP12,000
including VAT (30 September 2016: GBP12,000; 31 March 2017: GBP24,000)
by Albion Capital Group LLP in respect of Patrick Reeve's services as a
Director. At the financial period end, the amount due to Albion Capital
Group LLP in respect of these services disclosed as payables was
GBP6,000 (30 September 2016: GBP6,000; 31 March 2017: GBP6,000).
Albion Capital Group LLP is, from time to time, eligible to receive
transaction fees and monitoring fees from portfolio companies. During
the period to 30 September 2017, fees of GBP135,000 attributable to the
investments of the Company were received pursuant to these arrangements
(30 September 2016: GBP84,000; 31 March 2017: GBP167,000).
6. Dividends
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2017 30 September 2016 31 March 2017
GBP'000 GBP'000 GBP'000
Dividend of
2.50p per share
paid on 31
August 2016 - 1,156 1,156
Dividend of
2.50p per share
paid on 28
February 2017 - - 1,249
Dividend of
2.50p per share
paid on 31
August 2017 1,294 - -
1,294 1,156 2,405
In addition to the dividends summarised above, the Board has declared a
second dividend for the year ending 31 March 2018 of 2.50 pence per
share which will be paid on 28 February 2018 to shareholders on the
register on 9 February 2018. This is expected to amount to approximately
GBP1,386,000.
7. Basic and diluted return per share
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2017 30 September 2016 31 March 2017
Revenue Capital Total Revenue Capital Total Revenue Capital Total
Return attributable to equity shares (GBP'000) 1 1,209 1,210 246 1,337 1,583 299 4,781 5,080
Weighted average shares in issue (excluding treasury
shares) 51,809,944 46,172,950 46,759,602
Return attributable per Ordinary share (pence) (basic
and diluted) - 2.34 2.34 0.53 2.90 3.43 0.64 10.23 10.87
The weighted average number of shares is calculated excluding treasury
shares of 6,753,443 (30 September 2016: 6,029,443; 31 March 2017:
6,429,443).
There are no convertible instruments, derivatives or contingent share
agreements in issue for the Company, hence there are no dilution effects
to the return per share. The basic return per share is therefore the
same as the diluted return per share.
8. Called up share capital
Unaudited Unaudited Audited
30 September 2017 30 September 2016 31 March 2017
GBP'000 GBP'000 GBP'000
Allotted, called up and fully paid
58,462,876 Ordinary shares of 1 penny each (30 September
2016: 52,094,810; 31 March 2017: 57,964,774) 585 521 580
Voting rights
51,709,433 shares of 1 penny each (net of treasury shares) (30 September
2016: 46,065,367; 31 March 2017: 51,535,331).
In the six months to 30 September 2017, the Company purchased 324,000
shares (30 September 2016: 359,443; 31 March 2017: 759,443) to be held
in treasury with a nominal value of GBP3,200 (30 September 2016:
GBP3,600; 31 March 2017: GBP7,600) and at a cost of GBP312,000 (30
September 2016: GBP317,000; 31 March 2017: GBP689,000), representing 0.6
per cent. of the shares in issue (excluding treasury shares) as at 30
September 2017.
The Company holds a total of 6,753,443 shares (30 September 2016:
6,029,443; 31 March 2017: 6,429,443) in treasury representing 11.6 per
cent. of the shares in issue as at 30 September 2017.
Under the terms of the Dividend Reinvestment Scheme Circular dated 26
November 2009, the following new Ordinary shares of nominal value 1
penny each were allotted during the period to 30 September 2017:
Aggregate
nominal value Net
Date of Number of of shares Issue price invested Opening market price on allotment date (pence per
allotment shares allotted (GBP'000) (pence per share) (GBP'000) share)
31 August
2017 203,492 2 98.28 199 97.00
Under the terms of the Albion VCTs Prospectus Top Up Offers 2016/2017,
the following new Ordinary shares of nominal value 1 penny each were
allotted during the period to 30 September 2017:
Aggregate Net
nominal value consideration
Date of Number of of shares Issue price received Opening market price on allotment date (pence per
allotment shares allotted (GBP'000) (pence per share) (GBP'000) share)
7 April
2017 15,240 - 99.40 15 95.00
7 April
2017 16,057 - 99.90 16 95.00
7 April
2017 263,313 3 100.50 256 95.00
294,610 3 287
9. Commitments and contingencies
As at 30 September 2017, the Company had no financial commitments (30
September 2016: GBP245,000; 31 March 2017: GBPnil).
There are no contingencies or guarantees of the Company as at 30
September 2017 (30 September 2016: GBPnil, 31 March 2017: GBPnil).
10. Post balance sheet events
Since 30 September 2017, the Company has had the following material post
balance sheet events:
-- Investment of GBP917,000 in Women's Health (London West One) Limited;
-- Investment of GBP780,000 in Beddlestead Limited;
-- Investment of GBP305,000 in G.Network Communications Limited;
-- Investment of GBP182,000 in OmPrompt Holdings Limited; and
-- Investment of GBP152,000 in Sandcroft Avenue Limited (PayAsUGym.com).
The following new Ordinary shares of nominal value 1 penny per share
were allotted under the Albion VCTs prospectus Top Up Offers 2017/18
after 30 September 2017:
Aggregate
nominal value Net
Date of Number of of shares Issue price consideration received Opening market price on allotment date (pence per
allotment shares allotted (GBP'000) (pence per share) (GBP'000) share)
17
November
2017 1,324,563 13 99.80 1,302 95.25
17
November
2017 616,447 6 100.30 606 95.25
17
November
2017 1,796,032 18 100.80 1,765 95.25
3,737,042 37 3,673
11. Related party transactions
Other than transactions with the Manager as described in note 5, there
are no other related party transactions.
12. Going concern
The Board's assessment of liquidity risk remains unchanged since the
last Annual Report and Financial Statements for the year ended 31 March
2017, and is detailed on page 54 of those accounts. The Company has
adequate cash and liquid resources and has no borrowing. The portfolio
of investments is diversified in terms of sector, and the major cash
outflows of the Company (namely investments, share buy-backs and
dividends) are within the Company's control. Accordingly, after making
diligent enquiries, the Directors have a reasonable expectation that the
Company has adequate resources to continue in operational existence for
the foreseeable future. For this reason, the Directors have adopted the
going concern basis in preparing this Half-yearly Financial Report and
this is in accordance with the Guidance on Risk Management, Internal
Control and Related Financial and Business Reporting issued by the
Financial Reporting Council in September 2014.
13. Risks and uncertainties
In addition to the risks outline in the Interim management report, the
Board considers that the Company faces the following principal major
risks and uncertainties:
1. Investment and performance risk
The risk of investment in poor quality assets, which could reduce the
capital and income returns to shareholders, and could negatively impact
on the Company's current and future valuations. By nature, smaller
unquoted businesses, such as those that qualify for venture capital
trust purposes, are more fragile than larger, long established
businesses.
To reduce this risk, the Board places reliance upon the skills and
expertise of the Manager and its track record over many years of making
successful investments in this segment of the market. In addition, the
Manager operates a formal and structured investment appraisal and review
process, which includes an Investment Committee, comprising investment
professionals from the Manager and at least one external investment
professional. The Manager also invites and takes account of comments
from non-executive Directors of the Company on investments discussed at
the Investment Committee meetings. Investments are actively and
regularly monitored by the Manager (investment managers normally sit on
portfolio company boards), including the level of diversification in the
portfolio, and the Board receives detailed reports on each investment as
part of the Manager's report at quarterly board meetings.
1. VCT approval risk
The Company must comply with section 274 of the Income Tax Act 2007
which enables its investors to take advantage of tax relief on their
investment and on future returns. Breach of any of the rules enabling
the Company to hold VCT status could result in the loss of that status.
To reduce this risk, the Board has appointed the Manager, which has a
team with significant experience in venture capital trust management,
used to operating within the requirements of the venture capital trust
legislation. In addition, to provide further formal reassurance, the
Board has appointed Philip Hare & Associates LLP as its taxation adviser,
who report quarterly to the Board to independently confirm compliance
with the venture capital trust legislation, to highlight areas of risk
and to inform on changes in legislation. Each investment in a new
portfolio company is also pre-cleared with H.M. Revenue & Customs.
1. Regulatory and compliance risk
The Company is listed on The London Stock Exchange and is required to
comply with the rules of the UK Listing Authority, as well as with the
Companies Act, Accounting Standards and other legislation. Failure to
comply with these regulations could result in a delisting of the
Company's shares, or other penalties under the Companies Act or from
financial reporting oversight bodies.
Board members and the Manager have experience of operating at senior
levels within or advising quoted companies. In addition, the Board and
the Manager receive regular updates on new regulation from its auditor,
lawyers and other professional bodies. The Company is subject to
compliance checks through the Manager's Compliance Officer. The Manager
reports monthly to its Board on any issues arising from compliance or
regulation. These controls are also reviewed as part of the quarterly
Board meetings, and also as part of the review work undertaken by the
Manager's Compliance Officer. The report on controls is also evaluated
by the internal auditors.
1. Operational and internal control risk
The Company relies on a number of third parties, in particular the
Manager, for the provision of investment management and administrative
functions. Failures in key systems and controls within the Manager's
business could put assets of the Company at risk or result in reduced or
inaccurate information being passed to the Board or to shareholders.
The Company and its operations are subject to a series of rigorous
internal controls and review procedures exercised throughout the year.
The Audit Committee reviews the Internal Audit Reports prepared by the
Manager's internal auditors, PKF Littlejohn LLP. On an annual basis, the
Audit Committee chairman meets with the internal audit Partner to
provide an opportunity to ask specific detailed questions in order to
satisfy itself that the Manager has strong systems and controls in place
including those in relation to business continuity and cyber security.
In addition, the Board regularly reviews the performance of its key
service providers, particularly the Manager, to ensure they continue to
have the necessary expertise and resources to deliver the Company's
investment objective and policies. The Manager and other service
providers have also demonstrated to the Board that there is no undue
reliance placed upon any one individual within Albion Capital Group LLP.
1. Economic and political risk
Changes in economic conditions, including, for example, interest rates,
rates of inflation, industry conditions, competition, political and
diplomatic events and other factors could substantially and adversely
affect the Company's prospects in a number of ways.
The Company invests in a diversified portfolio of companies across a
number of industry sectors and in addition often invests a mixture of
equity and secured loan stock in portfolio companies and has a policy of
not normally permitting any external bank borrowings within portfolio
companies. At any given time, the Company has sufficient cash resources
to meet its operating requirements, including share buybacks and follow
on investments.
1. Market value of Ordinary shares
The market value of Ordinary shares can fluctuate. The market value of
an Ordinary share, as well as being affected by its net asset value and
prospective net asset value, also takes into account its dividend yield
and prevailing interest rates. As such, the market value of an Ordinary
share may vary considerably from its underlying net asset value. The
market prices of shares in quoted investment companies can, therefore,
be at a discount or premium to the net asset value at different times,
depending on supply and demand, market conditions, general investor
sentiment and other factors. Accordingly the market price of the
Ordinary shares may not fully reflect their underlying net asset value.
The Company operates a share buyback policy, which is designed to limit
the discount at which the Ordinary shares trade to around 5 per cent to
net asset value, by providing a purchaser through the Company in absence
of market purchasers. From time to time buybacks cannot be applied, for
example when the Company is subject to a close period, or if it were to
exhaust its buyback authorities, which are renewed each year. New
Ordinary shares are issued at sufficient premium to net asset value to
cover the costs of issue and to avoid asset value dilution to existing
investors.
14. Other information
The information set out in this Half-yearly Financial Report does not
constitute the Company's statutory accounts within the terms of section
435 of the Companies Act 2006 for the periods ended 30 September 2017
and 30 September 2016, and is unaudited. The information for the year
ended 31 March 2017 does not constitute statutory accounts within the terms of section 435 of the Companies Act 2006 but is derived from the statutory accounts for the financial year, which have been delivered to the Registrar of Companies. The Auditor reported on those accounts; their report was unqualified and did not contain statements under s498 (2) or (3) of the Companies Act 2006. 15. Publication This Half-yearly Financial Report is being sent to shareholders and copies will be made available to the public at the registered office of the Company, Companies House, the National Storage Mechanism and also electronically at www.albion.capital/funds/AAEV, where the Report can be accessed from the 'Financial Reports and Circulars' section. This announcement is distributed by Nasdaq Corporate Solutions on behalf of Nasdaq Corporate Solutions clients. The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein. Source: Albion Enterprise VCT PLC via Globenewswire http://www.closeventures.co.uk
(END) Dow Jones Newswires
December 04, 2017 08:16 ET (13:16 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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