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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Income & Growth Vct (the) Plc | LSE:IGV | London | Ordinary Share | GB00B29BN198 | 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% | 70.00 | 68.50 | 71.50 | 70.25 | 70.00 | 70.00 | 78 | 08:00:07 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Offices-holdng Companies,nec | 8.63M | 5.49M | 0.0348 | 20.11 | 110.27M |
From Apr 2019 to Apr 2024
TIDMIGV
RNS Number : 1138Z
Income & Growth VCT (The) PLC
12 December 2017
The Income & Growth VCT plc
Annual Financial Results of the Company for the Year ended 30 September 2017
The Income & Growth VCT plc (the "Company") today announces the final results for the year ended 30 September 2017. These results were approved by the Board of Directors on 12 December 2017. You may, in due course, view the Annual Report & Financial Statements, comprising the statutory accounts of the Company by visiting www.incomeandgrowthvct.co.uk.
Financial Highlights
Hot Features
Premium
- Net asset value total return per share was
4.8% for the year.
- Share price total return per share was 7.0%
for the year.
- Dividends paid and proposed in respect of
the year total 21.00 pence per share. The
proposed final dividend of 3.00 pence per
share, if approved, will bring cumulative
dividends paid to shareholders in respect
of the past five years to 71.00 pence per
share.
- The Company realised investments totalling
GBP14.73 million of cash proceeds and generated
realised gains over original investment cost
of GBP3.81 million.
- GBP8.07 million(1) was invested into six new
companies and two follow-on investments during
the year.
(1) This figure includes GBP2.76 million previously
held in companies preparing to trade.
PERFORMANCE SUMMARY
As at 30 September 2017 the Company had net
assets of GBP64.35 million and the net asset
value ("NAV") per share was 81.24 pence.
The table below shows the recent past performance
of the Company's existing class of shares for
each of the last five years.
Reporting Net NAV Share Cumulative Cumulative total Dividends
date assets per price(1) dividends return per share paid and
share paid to shareholders(2) proposed
per per share
share in respect
of each
year
As at (NAV (Share
30 September basis) price
basis)
(GBPm) (p) (p) (p) (p) (p) (p)
2017 64.35 81.24 73.00 102.50 183.74 175.50 21.00 (4)
2016 70.84 98.51 88.80 80.50 179.01 169.30 10.00
2015 75.20 106.38 93.50 68.50 174.88 162.00 12.00
2014 69.31 114.60 103.50(3) 50.50 165.10 154.00 18.00
2013 60.47 113.90 99.50 40.50 154.40 140.00 10.00
(1) Source: Panmure Gordon & Co. (mid-market price)
(2) Cumulative total return per share comprises the
NAV per share (NAV basis) or the mid-market price
per share (share price basis) plus cumulative
dividends paid since the launch of the current
share class.
(3) The share price at 30 September 2014 has been
adjusted to add back the dividend of 8.00 pence
per share paid on 30 October 2014, as the listed
share price was quoted ex this dividend at the
year-end.
(4) Dividends paid and proposed per share in respect
of 2017 include the final dividend of 3.00 pence
referred to above, which is subject to shareholder
approval at the Annual General Meeting ("AGM").
Chairman's Statement
I am pleased to present to shareholders the Annual
Report of the Company for the year ended 30 September
2017.
Overview
This has been another year of solid performance
by the Company. Returns to shareholders have again
been positive, due to a profitable portfolio company
exit as well as a good income return. Further
comment can be found under the 'Performance' section
of my Statement below and in the Investment's
Adviser's Review.
The Company and the Investment Adviser have responded
well to the VCT Rules introduced by the Finance
(No 2) Act 2015, having completed nine growth
capital investments since the change in the Company's
investment policy in February 2016. The Investment
Adviser has continued to recruit experienced growth
capital investors into its team and a healthy
pipeline of investment opportunities is being
evaluated.
Most recently, additional changes to VCT legislation
have been proposed in the Autumn Budget. Your
Board's opinion of the likely impact of these
changes can be found under the 'Industry and Regulatory
Changes' section of my statement below.
Fundraising
Shareholders should be aware that, on 6 September
2017, the Company launched an Offer for Subscription
to raise up to GBP15 million, with an over-allotment
facility to raise up to an additional GBP10 million.
I am pleased to report that demand for the Offer
has been strong from both new and existing shareholders.
To accommodate investor demand, the Board took
the decision to utilize its over-allotment facility
on 23 October 2017. To date, applications amount
to GBP16.3 million have been received. 19,072,153
shares have been allotted to date at offer prices
ranging from 81.21 to 87.36 pence per share, dependent
upon the prevailing net asset value at the date
of each allotment and the method by which each
investor subscribed for the Offer. The Offer will
close when fully subscribed, or on 4 April 2018,
whichever is the sooner.
Performance
The Company's NAV total return per share was 4.8%
for the year ended 30 September 2017 (2016: 3.9%),
after taking into account the dividends paid during
the year. This NAV return for the year was primarily
attributable to the sale of the Company's investment
in Entanet Holdings Limited and another year of
good revenue returns, arising principally from
income from loan stock investments.
As a result of this year's performance, the cumulative
NAV total return per share (being the closing
net asset value plus total dividends paid to date
since launch) increased during the year by 2.6%
(2016: 2.4%) from 179.01 pence to 183.74 pence.
Using the benchmark of NAV cumulative total return,
it is pleasing to report strong relative performance
over the long-term as well as in recent years,
as compared with the Company's peers. The VCT
was ranked in the second quartile over five years
and in the top quartile over ten years amongst
generalist (including planned exit) VCTs used
by the Association of Investment Companies ('AIC')
to measure performance at 31 October 2017. Further
details are included in the Strategic Report contained
in the Annual Report.
Final dividend
Your Board is proposing a final dividend in respect
of the year ending 30 September 2017 of 3.00 (2016:
4.00) pence per share. The dividend, comprising
2.50 pence from capital and 0.50 pence from income,
will be proposed to shareholders at the Annual
General Meeting of the Company to be held on 7
February 2018, to shareholders on the register
on 12 January 2018, for payment on 15 February
2018. This final dividend is in addition to the
special dividend of 15.00 pence paid on 31 August
2017 and the interim dividend of 3.00 pence paid
on 20 June 2017.
If approved by shareholders, this forthcoming
final dividend will bring dividends paid per share
in respect of the year ended 30 September 2017
to 21.00 pence (2016: 10.00 pence) and the Company
will have paid dividends totalling 71.00 pence
per share in respect of the last five years.
Shareholders should note, however, as a result
of the changes in the VCT Rules and the Company's
Investment Policy, that the Company may find it
a challenge to generate a similar level of dividends
over the next five years. Your Board will continue
to monitor whether the current annual dividend
target of 6.00 pence per share remains sustainable
in the current investment environment.
The Company's Dividend Investment Scheme ("the
Scheme") will apply to this dividend and new elections
under the Scheme should be received by the Scheme
administrator, Link Asset Services, by no later
than Wednesday, 31 January 2018. For further details
of the Scheme, please see the Shareholder Information
section of the Annual Report.
Investment portfolio
For the year under review, the portfolio as a
whole achieved a net increase of GBP3.88 million
on investment realised, but a decrease of GBP0.79
million on investments still held. Investment
realisations produced GBP3.81 million in capital
gains in excess of original investment cost. The
portfolio still under management was valued at
GBP48.03 million (2016: GBP54.36 million) at the
year-end, representing 94.8% of cost. This position
is mainly due to a former Investment Adviser's
investments which have been written down below
cost. Despite the apparent fall in value, on a
like for like basis (adding back realisations
and excluding new investments) the portfolio produced
a positive return of 5.7% over the year.
During the year GBP8.07 million (including GBP2.76
million previously held in companies preparing
to trade) was invested in six new companies and
two existing portfolio companies.
Six new growth capital investments totalling GBP6.98 million were made during the financial year. These investments were in: BookingTek, a provider of enterprise software to major hotel groups (plus a small follow on investment); Biosite, a biometric security access control developer; Tapas Revolution, a leading Spanish restaurant chain; Buster & Punch, a London based interiors retailer; MyTutorweb, an online tutoring business; and Wetsuit Outlet, a leading online retailer in the water sports market. In addition, two follow-on investments were made: GBP0.94 million into Preservica, a developer of digital archiving software; and GBP0.15 million into Mpb, an online marketplace for used camera and video equipment. Cash proceeds totalling GBP14.73 million were received from 14 companies that were either sold or which repaid loans. Of this total, GBP7.17 million was received cash proceeds from the substantial disposal of Entanet Holdings Limited (realising a gain of 5.48 pence per share) with a further GBP6.73 million being received as loan repayments and finally, GBP0.83 million as other receipts. Full details of the investment activity during the year and a summary of the performance highlights can be found in the Investment Adviser's Review in the Annual Report. Industry and regulatory developments As mentioned in my overview, the UK Government has undertaken a Patient Capital Review to identify and tackle factors considered to be adversely affecting the supply of longer term capital to small and developing firms. The consultation period closed on 22 September 2017 and strong representations were made on behalf of the VCT industry by Mobeus as Investment Adviser, the Venture Capital Trust Association and the Association of Investment Companies. The recent Chancellor's Autumn Budget Statement outlined the key findings from the review including a number of legislative changes to the VCT scheme, the earliest of which are due to come into effect from 6 April 2018. We understand that these changes are designed to exclude tax-motivated investments where capital is not at risk (that is, principally seeking to preserve investors' capital). Your Board notes the initiatives behind these changes. While some of these changes place further restrictions on the way investments may be structured, the Board currently has no reason to believe they will materially affect the Company's existing strategic objectives. A summary of the current VCT regulations and those proposed in the Autumn Budget is included in the Annual Report. Shareholder Event The Investment Adviser holds an annual VCT event for shareholders in Central London. The event will include presentations on the Mobeus advised VCTs' investment activity and performance. We have been pleased to receive positive comments from those attending in previous years. The next event will again be held at the Royal Institute of British Architects in Central London on Tuesday, 30 January 2018. There will be day-time and separate evening sessions. Shareholders have already been sent an invitation to this event with further details. If you have not replied to the invitation, but would like to attend, please apply to Mobeus (vcts@mobeusequity.co.uk) by email to register. The Board looks forward to meeting all shareholders able to join them at the event. Outlook Your Board remains of the opinion that your Company is well positioned to take advantage of the strong demand for growth capital investment, despite the uncertainties faced by the UK economy. The fundraising is currently anticipated to be fully subscribed and this will provide the Company with sufficient funds to continue the current investment rate in the medium term. Your Board will shortly be issuing further guidance (in a joint announcement with the boards of the other Mobeus-advised VCTs) on the impact of the Budget changes, in a supplementary prospectus to the Offer. This will be available on the Company's website and the National Storage Mechanism. Finally, I would like to take this opportunity once again to thank all shareholders for their continued support. Colin Hook Chairman INVESTMENT POLICY The Company's policy is to invest primarily in a diverse portfolio of UK unquoted companies. Investments are generally structured as part loan and part equity in order to receive regular income to generate capital gains upon sale and to reduce the risk of high exposure to equities. To further spread risk, investments are made in a number of businesses across different industry sectors. The Company's cash and liquid resources are held in a range of instruments which can be of varying maturities, subject to the overriding criterion that the risk of loss of capital be minimised. The Investment Policy is designed to ensure that the Company continues to qualify and is approved as a VCT by HMRC. For further information, please see the Strategic Report section of the Annual Report. Investment ADVISER'S Review Portfolio Review This has been a year of continued progress within the portfolio with the addition of six new growth capital investments totalling GBP6.98 million, two existing investments receiving follow-on funding totalling GBP1.09 million, and one significant profitable disposal generating net cash proceeds of GBP7.17 million resulting in a 2.5 times multiple over cost over the three and a half year life of the investment. The past year's investment and divestment activity has increased the proportion of the portfolio at value comprised of growth capital investments to 21.8%, excluding companies preparing to trade. The Company has now invested GBP9.85 million in growth capital investments since the introduction of the VCT regulations in 2015. The value of the existing portfolio decreased by GBP0.79 million during the year under review. This net fall in value is due to reductions in the valuations of Jablite, Veritek Global and Media Business Insight outweighing gains elsewhere in the portfolio, such as Gro-Group, Master Removers Group and Access IS. The majority of the investment portfolio companies are generating cash and trading well in uncertain economic circumstances. Demand for growth capital investment remains strong and there is a large pipeline of investment opportunities. It is expected that the pace and quantum of new investment will continue over the coming months. Patient Capital Review As the Chairman's Statement noted, the UK Government has conducted a review to identify and tackle factors considered to be adversely affecting the supply of longer term capital to small and developing firms. As anticipated, the Chancellor's recent Autumn Budget outlined the key findings from the review including a number of changes to the VCT scheme, the earliest of which are due to come into effect from 6 April 2018. Mobeus, as Investment Adviser, believe these changes should not overall affect the ability of the Company to continue to make successful growth capital investments. New investment in the year A total of GBP8.07 million was invested in new and existing investments during the year under review. New investments of GBP6.98 million were made into BookingTek, Biosite, Tapas Revolution, Buster & Punch, MyTutorweb and Wetsuit Outlet; all new growth capital investments. In addition, the Company made GBP1.09 million of follow-on investments into Preservica (originally arising from a spin out from a former portfolio company, Tessella) and Mpb to support further growth and development.
Further details of these investments are set out below:
Company Business Date of investment Amount of new
investment (GBPm)
------------------ -------------------- -------------------- -------------------
A provider
of direct-booking
systems to
major hotel October 2016
BookingTek groups / March 2017 0.78
------------------ -------------------- -------------------- -------------------
London-based BookingTek provides software that
enables hotels to reduce their reliance on third-party
booking systems through an enterprise-grade, real-time
booking platform for meeting rooms and restaurant
reservations. BookingTek's existing clients include
two of the world's top 10 hotel groups and the
UK's largest hotel group. On 27 March, the VCT
advanced a further GBP0.09 million as loan as envisaged
in the original investment plan. The company's
latest accounts for the year ended 31 July 2016
show turnover of GBP2.03 million and a loss before
interest, tax and amortisation of goodwill of GBP0.29
million.
-----------------------------------------------------------------------------------
Workforce
Biosite management November 2016 0.86
------------------ -------------------- -------------------- -------------------
Based in the Midlands, Biosite is a fast-growing
provider of biometric access control and software-based
workforce management solutions for the construction
sector. The investment was to support the expansion
of the Biosite team to facilitate the development
of new site-management tools to enable managers
to oversee all aspects of a construction project.
The company's latest accounts for the year ended
31 July 2016 show turnover of GBP4.69 million and
profit before interest, tax and amortisation of
goodwill of GBP0.49 million.
-----------------------------------------------------------------------------------
Restaurant
Tapas Revolution chain January 2017 0.78
------------------ -------------------- -------------------- -------------------
Based in London, Ibericos Etc. Limited (which trades
as Tapas Revolution) is a leading Spanish restaurant
chain in the casual dining sector, focussing on
shopping centre sites with high footfall. Having
opened its first restaurant in Shepherd's Bush
Westfield, the business has since opened a further
six restaurants. The investment provided growth
capital to a high-calibre team with significant
restaurant rollout experience which has spent the
past five years building and refining its offer
and is now well placed to capitalise on a strong
pipeline of new sites. The company's latest accounts
for the period ended 25 October 2016 show a turnover
of GBP4.25 million and loss before interest, tax
and amortisation of goodwill of GBP0.25 million.
-----------------------------------------------------------------------------------
Buster + Punch Retailer March 2017 0.72
------------------ -------------------- -------------------- -------------------
Buster and Punch Holdings Limited (formerly Chatfield
Services Limited) is a London-based interiors brand
founded in 2012 by architect and industrial designer
Massimo Buster Minale. Buster + Punch (www.busterandpunch.com)
started in a small garage in East London, where
it built the "world's first designer LED light
bulb" (the Buster Bulb) and made its name with
its industrial inspired lighting. Its products
are now sold in over 50 countries, both directly
and to end-consumers, designers and architects,
and through well-known retailers including John
Lewis, Harvey Nichols and Harrods. The investment
will support the business's international expansion
plans and the broadening of its product range.
The company's latest accounts for the year ended
31 March 2016 show turnover of GBP1.98 million
and profit before interest, tax and amortisation
of goodwill of GBP0.47 million.
-----------------------------------------------------------------------------------
MyTutorweb Online tutoring May 2017 0.63
------------------ -------------------- -------------------- -------------------
MyTutorweb is a digital marketplace that connects
school pupils seeking private one-to-one tuition
with university students. The business is satisfying
growing demand from both students and parents to
improve pupil's exam results and enhance their
academic and career prospects. This investment
supports and opportunity to consolidate the sizable
GBP2 billion UK tutoring market, grow MyTutorweb's
market presence and drive technological development
within the company. The company's latest accounts
for the year ended 31 December 2016 show turnover
of GBP0.21 million and a loss before interest,
tax and amortisation of goodwill of GBP0.79 million.
-----------------------------------------------------------------------------------
Wetsuit Outlet Retailer July 2017 3.21*
------------------ -------------------- -------------------- -------------------
B2C Holdings Limited (trading as Wetsuit Outlet)
has established itself as a leading online retailer
in the water sports market, stocking an impressive
brand portfolio including Musto, Billabong, Rip
Curl, O'Neill, Red Paddle (an existing Mobeus investment)
and Gul. The investment is to fund working capital
and growth in existing activities and enter two
new markets. Established in 2005, the company has
developed into a successful and profitable business
achieving turnover of GBP11.51 million and a profit
before interest, tax and amortisation of goodwill
of GBP1.77 million in the financial year ended
31 March 2017. * GBP2,708,100 previously held in
Manufacturing Services Investment Limited, a company
preparing to trade, was used for the investment
in Wetsuit Outlet. This resulted in a net repayment
to the Company of GBP668,400. A further GBP1,165,482
was also invested by the Company.
-----------------------------------------------------------------------------------
Further investments in existing portfolio companies
The Company made further investments of GBP0.94
million into Preservica, a leading provider of
digital preservation solutions, and GBP0.15 million
into Mpb, a leading online marketplace for used
camera and video equipment, during the year under
review.
Company Business Date of investment Amount of new
investment (GBPm)
------------ ----------------------- -------------------- -------------------
Provider of
digital preservation
Preservica solutions December 2016 0.94
------------ ----------------------- -------------------- -------------------
Preservica is a leading provider of digital preservation
solutions and its access software is used around
the globe by leading businesses, archives, libraries,
museums and government organisations to safeguard
and share valuable digital content. The company's
latest audited accounts for the year ended 31 March
2017 show turnover of GBP2.03 million and a loss
before interest, tax and amortisation of goodwill
of GBP1.16 million.
--------------------------------------------------------------------------------
Online Marketplace
for used camera
and video September
MPB Group equipment 2017 0.15
------------ ----------------------- -------------------- -------------------
Mpb is Europe's leading online marketplace for
used camera and video equipment. Based in Brighton,
its custom-designed pricing technology enables
Mpb to offer both buy and sell services through
the same platform and offers a one-stop shop for
all its customers. The investment is to fund expansion
of its platform globally, with launches into both
the US and German markets. The company's latest
audited accounts for the year ended 31 March 2016
show turnover of GBP8.37 million and a loss before
interest, tax and amortisation of goodwill of GBP0.001
million.
--------------------------------------------------------------------------------
Realisations in the year
The Company realised one investment during the
year under review for cash proceeds totalling GBP7.17
million. This was the very successful sale of the
Company's investment in Entanet Holdings Limited,
detailed below.
Company Business Period of Total cash proceeds
investment over the life
of the investment/
Multiple over
cost
-------- --------------------- -------------- --------------------
Entanet Wholesale February 2014 GBP8.10 million
voice and to August 2.5 times cost
data communications 2017
provider
-------- --------------------- -------------- --------------------
The Company sold its investment in Entanet to AIM
quoted CityFibre Infrastructure Holdings Limited
for GBP7.17 million in August 2017. Deferred contingent
consideration of up to GBP0.74 million is potentially
payable over the next two years. Excluding this
deferred consideration, the Company has so far
realised a gain over the life of the investment
of GBP4.93 million, a multiple of 2.5 times cost
and has returned an IRR of 39% to date - an excellent
outcome.
---------------------------------------------------------------------
Mobeus Equity Partners LLP
Investment Adviser
Investment Portfolio
Summary
for the year ended
30 September 2017
Total Total Additional Total % % of
cost Valuation investments valuation of portfolio
at at at equity by
Held value
30-Sep-17 30-Sep-16 30-Sep-17
GBP GBP GBP GBP
Tovey Management
Limited (trading
as Access IS) 3,313,932 3,532,917 - 3,880,197 13.1% 8.1%
Provider of data
capture and scanning
hardware
Virgin Wines Holding
Company Limited 2,745,503 3,706,526 - 3,483,880 13.7% 7.3%
Online wine retailer
Manufacturing Services
Investment Limited
(trading as Wetsuit
Outlet) 3,205,182 2,708,100 1,165,482 3,205,182 8.8% 6.7%
Online retailer
in the water sports
market
ASL Technology
Holdings Limited 2,722,106 2,870,789 - 2,845,619 13.3% 5.9%
Printer and photocopier
services
I-Dox plc 453,881 2,833,470 - 2,687,629 1.0% 5.6%
Developer and supplier
of knowledge management
products
Gro-Group Holdings
Limited 2,398,928 1,651,824 - 2,606,640 16.3% 5.4%
Baby sleep products
Media Business
Insight Holdings
Limited 3,666,556 2,980,641 - 2,443,888 21.2% 5.1% A publishing and events business focussed on the creative production industries Vian Marketing Limited (trading as Red Paddle Co) 1,207,437 1,593,103 - 1,906,790 9.5% 4.0% Design, manufacture and sale of stand-up paddleboards and windsurfing sails EOTH Limited (trading as Equip Outdoor Technologies) 1,383,313 1,495,307 - 1,809,879 2.5% 3.8% Distributor of branded outdoor equipment and clothing including the Rab and Lowe Alpine brands Tharstern Group Limited 1,454,278 1,777,923 - 1,770,484 16.2% 3.7% Software based management Information systems for the printing industry Veritek Global Holdings Limited 2,289,859 2,297,607 - 1,752,129 14.6% 3.6% Maintenance of imaging equipment Fullfield Limited (trading as Motorclean) 1,517,734 2,020,433 - 1,606,346 13.2% 3.3% Vehicle cleaning and valet services Master Removers Group Limited (formerly Leap New Co Limited (trading as Anthony Ward Thomas, Bishopsgate and Aussie Man & Van)) 682,183 878,989 - 1,379,326 5.8% 3.0% A specialist logistics, storage and removals business CGI Creative Graphics International Limited 1,943,948 1,768,414 - 1,301,638 8.8% 2.7% Vinyl graphics to global automotive, recreation vehicle and aerospace markets Turner Topco Limited (trading as ATG Media) 1,529,075 1,114,321 - 1,209,162 3.7% 2.5% Publisher and online auction platform operator Redline Worldwide Limited 1,129,121 1,129,121 - 1,145,887 9.1% 2.4% Provider of security services to the aviation industry and other sectors RDL Corporation Limited 1,441,667 1,409,809 - 1,072,527 13.0% 2.3% Recruitment consultants within the pharmaceutical, business intelligence and IT industries MPB Group Limited 804,855 650,075 154,780 1,023,613 7.3% 2.1% Online marketplace for used photographic equipment Preservica Limited 935,000 - 935,000 935,000 6.3% 1.9% Seller of proprietary digital archiving software Bourn Bioscience Limited 1,610,379 1,206,547 - 925,420 10.9% 1.9% Management of In-vitro fertilisation clinics Pattern Analytics Limited (trading as Biosite) 857,014 - 857,014 857,014 6.4% 1.8% Workforce management and security services for the construction industry BookingTek Limited 779,095 - 779,095 779,095 4.6% 1.6% Software for hotel groups Ibericos Etc. Limited (trading as Tapas Revolution) 776,386 - 776,386 776,386 7.8% 1.6% Spanish restaurant chain TPSFF Limited (formerly The Plastic Surgeon Holdings Limited) 239,688 836,215 - 765,694 7.7% 1.6% Supplier of snagging and finishing services to the property sector Buster and Punch Holdings Limited (formerly Chatfield Services Limited) 725,226 1,504,000 - 725,226 6.2% 1.5% Industrial inspired lighting and interiors retailer Aquasium Technology Limited 166,667 681,377 - 706,592 16.7% 1.5% Manufacturing and marketing of bespoke electron beam welding and vacuum furnace equipment My Tutorweb Limited 636,477 - 636,477 636,477 6.2% 1.3% Digital marketplace connecting school pupils seeking one-to-one online tutoring Hollydale Management Limited 994,560 1,554,000 - 621,600 15.5% 1.3% Company seeking to carry on a business in the food sector Vectair Holdings Limited 53,400 302,340 - 601,006 4.6% 1.3% Designer and distributor of washroom products Omega Diagnostics Group plc 280,026 367,511 - 501,682 1.8% 1.0% In-vitro diagnostics for food intolerance, autoimmune diseases and infectious diseases Blaze Signs Holdings Limited 418,281 608,241 - 438,320 12.5% 0.9% Manufacturer and installer of signs Jablite Holdings Limited 498,790 1,271,052 - 304,755 12.1% 0.6% Manufacturer of expanded polystyrene products Backhouse Management Limited 782,080 1,504,000 - 300,800 15.0% 0.6% Company seeking to carry on a business in the motor sector Barham Consulting Limited 782,080 1,504,000 - 300,800 15.0% 0.6% Company seeking to carry on a business in the catering sector Creasy Marketing Services Limited 782,080 1,504,000 - 300,800 15.0% 0.6% Company seeking to carry on a business in the textile sector McGrigor Management Limited 782,080 1,504,000 - 300,800 15.0% 0.6% Company seeking to carry on a business in the pharmaceutical sector LightWorks Software Limited 20,471 61,212 - 87,596 9.2% 0.2% Provider of software for CAD and CAM vendors BG Training Limited 53,125 70,833 - 26,563 0.0% 0.1% Technical training business Corero Network Security plc 600,000 9,577 - 7,866 0.1% 0.0% Provider of e-business technologies Racoon International Group Limited (formerly Racoon International Holdings) 655,851 104,999 - - 10.8% 0.0% Supplier of hair extensions, hair care products and training Newquay Helicopters (2013) Limited (in liquidation) 15,234 - - - 5.0% 0.0% Helicopter service operator CB Imports Group Limited (trading as Country Baskets) 175,000 - - - 5.8% 0.0% Importer and distributor of artificial flowers, floral sundries and home decor products Oxonica Limited 2,524,527 - - - 10.6% 0.0% International nanomaterials group NexxtDrive Limited/Nexxt E-drive Limited 487,014 - - - 3.9% 0.0% Developer and exploiter of mechanical transmission technologies Biomer Technology Limited 137,170 - - - 3.0% 0.0% Developer of biomaterials for medical devices Watchgate Limited 1,000 - - - 33.3% 0.0% Holding company Disposed in year Entanet Holdings Limited - 3,351,685 - - 0.0% 0.0% Wholesale communications provider Focus Pharma Holdings Limited - - - - 0.0% 0.0% Licensor and distributor of generic pharmaceuticals MachineWorks Software Limited - - - - 0.0% 0.0% Provider of software for CAD and CAM vendors Total 50,658,259 54,364,958 5,304,234 48,030,308 100.0% ----------------------------- ----------- ----------- ------------- ----------- -------- -----------
For further information on the Investment Portfolio, please see the Annual Report and Financial Statements
PRINCIPAL RISKS
The Directors acknowledge the Board's responsibilities
for the Company's internal control systems and
have instigated systems and procedures for identifying,
evaluating and managing the principal risks faced
by the Company. This includes a key risk management
review which takes place at each quarterly Board
meeting. The principal risks identified by the
Board, a description of the possible consequences
of each risk and how the Board manages each risk
are set out below.
The risk profile of the Company changed as a consequence
of the VCT regulations introduced in 2015. As the
Company is required to focus its investment on
growth capital investments in younger companies
it is anticipated that investment returns will
be more volatile and will have a higher risk profile.
The Board remains confident that the Company and
the Investment Adviser has adapted to these new
requirements and put in place appropriate resource
to identify and make suitable investments.
The Board regularly sets and reviews policies for
financial risk management and full details of these
can be found in Note 16 to the Financial Statements.
Risk Possible How the Board manages
consequence risk
--------------- -------------------- ------------------------------------------------------------
Investment Investment in
and unquoted * The Board regularly reviews the Company's Strategy
strategic small companies including its Investment Policy.
involves
a higher degree of
risk than * Careful selection and review of the Investment
investment portfolio on a regular basis.
in fully listed
companies.
Smaller companies
often
have limited
product
lines, markets or
financial
resources and may
be
dependent for their
management on a
smaller
number of key
individuals.
--------------- -------------------- ------------------------------------------------------------
Loss of A breach of the VCT
approval Tax Rules may lead * The Company's VCT qualifying status is regularly
as a Venture to the Company reviewed by the Board and the Investment Adviser.
Capital losing
Trust its approval as a
VCT, * The Board receives regular reports from its VCT
which would result Status Adviser who has been retained by the Board to
in qualifying monitor the VCT's compliance with the VCT Rules.
shareholders
who have not held
their
shares for the
designated
period having to
repay
the income tax
relief
they obtained and
future
dividends paid by
the
Company being
subject
to tax. The Company
would also lose its
exemption from
corporation
tax on capital
gains.
--------------- -------------------- ------------------------------------------------------------
Regulatory The Company is
required * Regulatory and legislative developments are kept
to meet its legal under review by the Board.
and
regulatory
obligations
as a VCT, a listed
company and its own
Alternative
Investment
Fund Manager
(AIFM).
Failure to comply
might
result in
suspension
of the Company's
Stock
Exchange listing,
financial
penalties or a
qualified
audit report or a
loss
of the Company's
status
as a VCT.
--------------- -------------------- ------------------------------------------------------------
Counterparty A counterparty may
fail to discharge * The Board regularly reviews and agrees policies for
an managing these risks. Further details can be found i
obligation or n
commitment the discussion on 'credit risk' in Note 16 to the
that it has entered Financial Statements.
into with the
Company.
--------------- -------------------- ------------------------------------------------------------
Economic Events such as the
impact of Brexit, * The Board monitors (1) the portfolio as a whole to
an ensure that the Company invests in a diversified
economic recession portfolio of companies and (2) developments in the
and movements in macro-economic environment such as movements in
interest interest rates.
rates could affect
trading conditions
for smaller
companies
and consequently
the
value of the
Company's
qualifying
investments.
--------------- -------------------- ------------------------------------------------------------
Financial Failure of the
and systems * The Board carries out an annual review of the
operating (including breaches internal controls in place, reviews the risks facing
of cyber security) the Company at each quarterly Board meeting and
at any of the third receives reports by exception.
party service
providers
that the Company * It reviews the performance of the service providers
has annually and has obtained assurance that such
contracted with providers have controls in place to reduce the risk
could of breaches of their cyber security.
lead to inaccurate
reporting or
monitoring.
Inadequate controls
could lead to the
misappropriation
or insecurity of
assets.
--------------- -------------------- ------------------------------------------------------------
Market Movements in the UK
Stock Market * The Board receives and reviews quarterly valuation
indices reports from the Investment Adviser.
will inevitably
impact
the valuation of * The Investment Adviser alerts the Board about any
the adverse movements.
VCT's investments.
--------------- -------------------- ------------------------------------------------------------
Asset The Company's
liquidity investments * The Board receives reports from the Investment
may be difficult to Adviser and reviews the portfolio at each quarterly
realise. board meeting. It carefully monitors investments
where a particular risk has been identified.
--------------- -------------------- ------------------------------------------------------------
Market Shareholders may
liquidity find * The Board has a share buyback policy which seeks to
it difficult to mitigate market liquidity risk for shareholders. Thi
sell s
their shares at a policy is reviewed at each quarterly Board meeting.
price
which is close to
the
net asset value.
--------------- -------------------- ------------------------------------------------------------
Statement of Directors' Responsibilities
The Directors are responsible for preparing the
Annual Report and the Financial Statements in accordance
with applicable law and regulations.
Company law requires the Directors to prepare Financial
Statements for each financial year and the Directors
have elected to prepare the Financial Statements
in accordance with United Kingdom Generally Accepted
Accounting Practice (United Kingdom Accounting
Standards and applicable law). Under company law
the Directors must not approve the Financial Statements
unless they are satisfied that they give a true
and fair view of the state of affairs of the Company
and of the profit or loss of the Company for that
period.
In preparing these Financial Statements, the Directors
are required to:
- select suitable accounting policies and then
apply them consistently;
- make judgements and accounting estimates that
are reasonable and prudent;
- state whether the Financial Statements have
been prepared in accordance with United Kingdom
accounting standards, subject to any material
departures disclosed and explained in the
Financial Statements;
- prepare the Financial Statements on the going
concern basis unless it is inappropriate to
presume that the Company will continue in
business;
- prepare a Strategic Report, a Director's Report
and Directors' Remuneration Report which comply
with the requirements of the Companies Act
2006.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show
and explain the Company's transactions and disclose
with reasonable accuracy at any time the financial
position of the Company and enable them to ensure
that the Financial Statements comply with the Companies
Act 2006. They are also responsible for safeguarding
the assets of the Company and hence for taking
reasonable steps for the prevention and detection
of fraud and other irregularities.
Website publication
The Directors are responsible for ensuring the
Annual Report and the Financial Statements are
made available on a website. Financial Statements
are published on the Company's website in accordance
with legislation in the United Kingdom governing
the preparation and dissemination of Financial
Statements, which may vary from legislation in
other jurisdictions. The maintenance and integrity
of the Company's website is the responsibility
of the Directors. The Directors' responsibility
also extends to the ongoing integrity of the Financial
Statements contained therein.
Directors' responsibilities pursuant to Disclosure
and Transparency Rule 4 of the UK Listing Authority
The Directors confirm to the best of their knowledge
that:
(a) The Financial Statements, which have been
prepared in accordance with United Kingdom
Generally Accepted Accounting Practice give
a true and fair view of the assets, liabilities,
financial position and the profit of the
Company.
(b) The Annual Report includes a fair review
of the development and performance of the
business and the position of the Company,
together with a description of the principal
risks and uncertainties that it faces.
Having taken advice from the Audit Committee, the
Board considers the Annual Report and Financial
Statements, taken as a whole, is fair, balanced
and understandable and that it provides the information
necessary for shareholders to assess the Company's
performance, business model and strategy.
Neither the Company nor the Directors accept any
liability to any person in relation to the Annual
Report except to the extent that such liability
could arise under English law.
For and on behalf of the Board
Colin Hook
Chairman
FINANCIAL STATEMENTS
Income
Statement
for the year Year ended 30 September Year ended 30 September
ended 30 2017 2016
September
2017
Notes Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
Net unrealised
(losses)/gains
on investments 8 - (794,007) (794,007) - 549,889 549,889
Net gains on
realisation
of investments 8 - 3,883,829 3,883,829 - 2,506,146 2,506,146
Income 3 3,266,634 - 3,266,634 3,201,629 - 3,201,629
Investment
Adviser's fees 4a (394,012) (1,182,037) (1,576,049) (419,260) (1,257,781) (1,677,041)
Investment
Advisers'
performance
fees 4b - (571,879) (571,879) - (1,140,221) (1,140,221)
Other expenses (423,354) - (423,354) (392,228) - (392,228)
---------------- --- --------------------- ----------------------- ----------------------- ----------------------- ------------------------- -------------------------
Profit on
ordinary
activities
before
taxation 2,449,268 1,335,906 3,785,174 2,390,141 658,033 3,048,174
Tax on profit
on ordinary
activities 5 (421,283) 421,283 - (479,600) 479,600 -
---------------- --- --------------------- ----------------------- ----------------------- ----------------------- ------------------------- -------------------------
Profit for
the year and
total
comprehensive
income 2,027,985 1,757,189 3,785,174 1,910,541 1,137,633 3,048,174
Basic and
diluted
earnings per
ordinary
share: 6 2.79p 2.42p 5.21p 2.68p 1.60p 4.28p
The revenue column of the Income Statement includes
all income and expenses. The capital column accounts
for the unrealised (losses)/gains and realised
gains on investments and the proportion of the
Investment Adviser's fee charged to capital.
The total column is the Statement of Total Comprehensive
Income of the Company prepared in accordance with
Financial Reporting Standards ("FRS"). In order
to reflect better the activities of a VCT and in
accordance with the 2014 Statement of Recommended
Practice ("SORP") (updated in January 2017) by
the Association of Investment Companies ("AIC"),
supplementary information which analyses the Income
Statement between items of a revenue and capital
nature has been presented alongside the Income
Statement. The revenue column of profit attributable
to equity shareholders is the measure the Directors
believe appropriate in assessing the Company's
compliance with certain requirements set out in
Section 274 Income Tax Act 2007.
All the items in the above statement derive from
continuing operations of the Company. No operations
were acquired or discontinued in the year.
Balance sheet
as at 30 September 2017
Notes as at 30 September as at 30 September
2017 2016
GBP GBP
Fixed assets
Investments at fair
value 8 48,030,308 54,364,958
Current assets
Debtors and prepayments 3,372,032 304,935
Current asset investments 9 12,412,671 15,338,067
Cash at bank and in
hand 9 1,375,065 2,189,856
--------------------------- ------ ------------------- -------------------
17,159,768 17,832,858
Creditors: amounts
falling due within
one year (841,325) (1,357,178)
--------------------------- ------ ------------------- -------------------
Net current assets 16,318,443 16,475,680
--------------------------- ------ ------------------- -------------------
Net assets 64,348,751 70,840,638
Capital and reserves
Called up share capital 10 792,047 719,140
Capital redemption
reserve 14,014 11,985
Share premium reserve 24,099,311 18,308,887
Revaluation reserve 4,020,689 4,744,396
Special reserve 23,215,643 24,980,045
Profit and loss account 12,207,047 22,076,185
--------------------------- ------ ------------------- -------------------
Equity shareholders'
funds 64,348,751 70,840,638
--------------------------- ------ ------------------- -------------------
Basic and diluted net
asset value per share
Ordinary shares 11 81.24p 98.51p
--------------------------- ------ ------------------- -------------------
Statement of Changes in Equity for the year ended
30 September 2017
Non-distributable Distributable Total
reserves reserves
Notes Called Capital Share Revaluation Special Realised Revenue
up redemption premium reserve distributable capital reserve
share reserve reserve reserve reserve
capital
(Note (Note (Note
a) b) b)
GBP GBP GBP GBP GBP GBP GBP GBP
At 1 October
2016 719,140 11,985 18,308,887 4,744,396 24,980,045 20,225,980 1,850,205 70,840,638
Comprehensive
income for the
year
(Loss)/profit
for the
year - - - (794,007) - 2,551,196 2,027,985 3,785,174
---------------- ------------- ----------- ----------- ------------ -------------- ------------- ------------ -------------
Total
comprehensive
income for
the year - - - (794,007) - 2,551,196 2,027,985 3,785,174
---------------- ------------- ----------- ----------- ------------ -------------- ------------- ------------ -------------
Contributions
by and
distributions
to owners
Shares issued
via Offer
for
Subscription
(note c) 10 36,277 - 2,910,719 - (786) - - 2,946,210
Dividends
re-invested
into new
shares 10 38,659 - 2,879,705 - - - - 2,918,364
Shares bought
back (note
d, note
e) 10 (2,029) 2,029 - - (160,323) - - (160,323)
Dividends
paid 7 - - - - - (14,175,466) (1,805,846) (15,981,312)
---------------- --- -------- ----------- ----------- ------------ -------------- ------------- ------------ -------------
Total contributions
by and
distributions
to owners 72,907 2,029 5,790,424 - (161,109) (14,175,466) (1,805,846) (10,277,061)
--------------------- -------- ----------- ----------- ------------ -------------- ------------- ------------ -------------
Other movements
Realised losses
transferred
to special
reserve (note
f) - - - - (1,603,293) 1,603,293 - -
Realisation
of previously
unrealised
depreciation - - - 70,300 - (70,300) - -
--------------------- -------- ----------- ----------- ------------ -------------- ------------- ------------ -------------
Total other
movements - - - 70,300 (1,603,293) 1,532,993 - -
At 30 September
2017 792,047 14,014 24,099,311 4,020,689 23,215,643 10,134,703 2,072,344 64,348,751
---------------- --- -------- ----------- ----------- ------------ -------------- ------------- ------------ -------------
Notes
a) The Company's special reserve is available
to fund buy-backs of shares as and when it is
considered by the Board to be in the interests
of the shareholders, and to absorb any existing
and future realised losses and for other corporate
purposes. As at 30 September 2017, the Company
has a special reserve of GBP23,215,643, all of
which relates to reserves from shares issued on
or before 5 April 2014.
b) The realised capital reserve and the revenue
reserve together comprise the Profit and Loss
Account of the Company shown in the Balance Sheet.
c) On 28 September 2017, 3,627,706 shares were
issued under the Offer for Subscription and net
funds receivable of GBP2,946,210 is held within
debtors at 30 September 2017. This figure is net
of issue costs of GBP45,529.
d) The shareholders authorised the Company to
purchase its own shares for cancellation pursuant
to section 701 of the Companies Act 2006 at the
Annual General Meeting held on 8 February 2017.
The authority was limited to a maximum number
of 10,779,912 shares (this being approximately
14.99% of the issued share capital at the date
of the Notice of the meeting). The minimum price
which may be paid for a share is 1 penny per share,
the nominal value thereof. The maximum price that
may be paid for a share is an amount that is not
more than 5% above the average of the middle market
quotations of the shares as derived from the Daily
Official List of the London Stock Exchange for
the five business days preceding such purchase.
The authorities provide that the Company may make
a contract or contracts to purchase its own shares
prior to the expiry of the authority which may
be executed in whole or part after the expiry
of such authority, and may purchase its shares
in pursuance of any such contract.
e) During the year, the Company repurchased 202,886
of its own shares at the prevailing market price
for a total cost of GBP160,323, which were subsequently
cancelled. The difference between the figure shown
above of GBP160,323, and that per the Statement
of Cash Flows of GBP115,024 is due to an opening
share buyback creditor of GBP37,339, offset by
a share buyback creditor at 30 September 2017
of GBP82,638.
f) The transfer of GBP1,603,293 to the special
reserve from the realised capital reserve above
is the total of realised losses incurred by the
Company this year.
Statement of Changes in Equity for the year ended
30 September 2016
Non-distributable Distributable Total
reserves reserves
Called Capital Share Revaluation Special Realised Revenue
up redemption premium reserve distributable capital reserve
share reserve reserve reserve reserve
capital
GBP GBP GBP GBP GBP GBP GBP GBP
At 1
October
2015 706,930 9,288 16,977,902 8,997,633 27,147,965 19,653,747 1,708,831 75,202,296
Comprehensive
income
for the
year
Profit
for
the
year - - - 549,889 - 587,744 1,910,541 3,048,174
---------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ ------------
Total
comprehensive
income
for the
year - - - 549,889 - 587,744 1,910,541 3,048,174
---------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ ------------
Contributions
by and
distributions
to owners
Dividends
re-invested
into new
shares 14,907 - 1,330,985 - - - - 1,345,892
Shares
bought
back (2,697) 2,697 - - (249,518) - - (249,518)
Dividends
paid - - - - - (6,737,039) (1,769,167) (8,506,206)
---------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ ------------
Total
contributions
by and
distributions
to owners 12,210 2,697 1,330,985 - (249,518) (6,737,039) (1,769,167) (7,409,832)
---------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ ------------
Other
movements
Realised
losses
transferred
to special
reserve - - - - (1,918,402) 1,918,402 - -
Realisation
of previously
unrealised
depreciation - - - (4,803,126) - 4,803,126 - -
---------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ ------------
Total
other
movements - - - (4,803,126) (1,918,402) 6,721,528 - -
---------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ ------------
At 30
September
2016 719,140 11,985 18,308,887 4,744,396 24,980,045 20,225,980 1,850,205 70,840,638
---------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ ------------
The composition of each of these
reserves is explained below:
Called up share
capital
The nominal value of shares originally issued, increased
for subsequent share issues either via an Offer
for Subscription or Dividend Investment Scheme or
reduced due to shares bought back by the Company.
Capital redemption
reserve
The nominal value of shares bought back and cancelled
is held in this reserve, so that the company's capital
is maintained.
Share premium reserve
This reserve contains the excess of gross proceeds
less issue costs over the nominal value of shares
allotted under recent Offers for Subscription and
the Company's Dividend Investment Scheme.
Revaluation reserve
Increases and decreases in the valuation of investments
held at the year-end are accounted for in this reserve,
except to the extent that the diminution is deemed
permanent.
In accordance with stating all investments at fair
value through profit and loss (as recorded in note
8 to the Financial Statements), all such movements
through both revaluation and realised capital reserves
are shown within the Income Statement for the year.
Special distributable
reserve
The cost of share buybacks is charged to this reserve.
In addition, any realised losses on the sale or
impairment of investments (excluding transaction
costs), and 75% of the Investment Adviser fee expense,
and the related tax effect, are transferred from the realised capital reserve to this reserve. Realised capital reserve The following are accounted for in this reserve: -- Gains and losses on realisation of investments; -- Permanent diminution in value of investments; -- Transaction costs incurred in the acquisition of investments; -- 75% of the Investment Adviser fee expense and 100% of any performance fee payable, together with the related tax effect to this reserve in accordance with the policies, and -- Capital dividends paid. Revenue reserve Income and expenses that are revenue in nature are accounted for in this reserve together with the related tax effect, as well as income dividends paid that are classified as revenue in nature.
STATEMENT OF CASH FLOWS
for the year ended 30 September 2017
Year ended Year ended
30 September 30 September
2017 2016
Notes GBP GBP
Cash flows from operating
activities
Profit for the financial
year 3,785,174 3,048,174
Adjustments for:
Net unrealised losses/(gains)
on investments 794,007 (549,889)
Net gains on realisations
on investments (3,883,829) (2,506,146)
(Increase)/decrease in
debtors (120,887) 77,630
(Decrease)/increase in
creditors and accruals (561,152) 190,471
------------------------------- ------ -----------------------
Net cash inflow from
operating activities 13,313 260,240
Cash flows from investing
activities
Purchase of investments 8 (5,304,234) (936,007)
Disposal of investments 8 14,728,706 10,742,834
Decrease in bank deposits
with a maturity over three
months 2,028,243 1,960,755
--------------------------------------- ----------------------- ---------------------------
Net cash inflow from
investing activities 11,452,715 11,767,582
Cash flows from financing
activities
Shares issued as part - -
of Offer for Subscription
Equity dividends paid 7 (13,062,948) (7,160,312)
Purchase of own shares (115,024) (212,644)
Net cash outflow from
financing activities (13,177,972) (7,372,956)
Net (decrease)/increase
in cash and cash equivalents (1,711,944) 4,654,866
Cash and cash equivalents
at start of year 12,347,911 7,693,045
Cash and cash equivalents
at end of year 10,635,967 12,347,911
Cash and cash equivalents
comprise:
Cash at bank and in hand 9 1,375,065 2,189,856
Cash equivalents 9 9,260,902 10,158,055
Notes to the Financial Statements
for the year ended 30 September 2017
1 Company Information
The Income and Growth VCT plc is a public limited
company incorporated in England, registration number
4069483. The registered office is 30 Haymarket,
London, SW1Y 4EX.
2 Basis of preparation
A summary of the principal accounting policies,
all of which have been applied consistently throughout
the year are set out at the start of the related
disclosure throughout the Notes to the Financial
Statements. All accounting policies are included
within an outlined box at the top of each relevant
note.
These Financial Statements have been prepared
in accordance with applicable United Kingdom accounting
standards, including Financial Reporting Standard
102 ("FRS102"), with the Companies Act 2006 and
the 2014 Statement of Recommended practice, 'Financial
Statements of Investment Trust Companies and Venture
Capital Trusts' ('the SORP') (updated in January
2017) issued by the Association of Investment Companies.
The Company has a number of financial instruments
which are disclosed under FRS102 s11/12 as shown
in Note 16 to the Financial Statements.
The Company has elected to apply early the revised
disclosure requirements as set out in Amendments
to FRS 102 - Fair Value hierarchy disclosures issued
in March 2016.
3 Income
Dividends receivable on quoted equity shares are
brought into account on the ex-dividend date. Dividends
receivable on unquoted equity shares are brought
into account when the Company's right to receive
payment is established and there is no reasonable
doubt that payment will be received.
Interest income on loan stock is accrued on a daily
basis. Provision is made against this income where
recovery is doubtful or where it will not be received
in the foreseeable future. Where the loan stocks
only require interest or a redemption premium to
be paid on redemption, the interest and redemption
premium is recognised as income or capital as appropriate
once redemption is reasonably certain. When a redemption
premium is designed to protect the value of the
instrument holder's investment rather than reflect
a commercial rate of revenue return the redemption
premium is recognised as capital. The treatment
of redemption premiums is analysed to consider
if they are revenue or capital in nature on a company
by company basis. Accordingly, the redemption premium
recognised in the year ended 30 September 2017
has been classified as capital and has been included
within unrealised gains on investments
2017 2016
GBP GBP
Income from bank deposits 55,893 101,393
------------------------------- ----------- ----------
Income from investments
- from equities 288,843 114,915
- from OEIC funds 21,960 38,412
- from loan stock 2,899,869 2,946,909
3,210,672 3,100,236
Other income 69 -
------------------------------- ----------- ----------
Total income 3,266,634 3,201,629
------------------------------- ----------- ----------
Total income comprises
Revenue dividends received 310,803 153,327
Interest 2,955,762 3,048,302
Other income 69 -
------------------------------- ----------- ----------
Total Income 3,266,634 3,201,629
------------------------------- ----------- ----------
Income from investments
comprises
Listed UK securities 36,086 36,086
Listed overseas securities 21,960 38,412
Unlisted UK securities 3,152,626 3,025,738
Total investment income 3,210,672 3,100,236
------------------------------- ----------- ----------
Total loan stock interest due but not recognised
in the year was GBP223,159 (2016: GBP525,395)
due to uncertainty over its recoverability.
4 Investment Adviser's fees and performance fees
25% of the Investment Adviser's fees are charged
to the revenue column of the Income Statement,
while 75% is charged against the capital column
of the Income Statement. This is in line with
the Board's expected long-term split of returns
from the investment portfolio of the Company.
100% of any performance incentive fee payable
for the year is charged against the capital
column of the Income Statement, as it is based
upon the achievement of capital growth
a) Investment Adviser's fees
Revenue Capital Total Revenue Capital Total
2017 2017 2017 2016 2016 2016
GBP GBP GBP GBP GBP GBP
Mobeus Equity
Partners LLP 394,012 1,182,037 1,576,049 419,260 1,257,781 1,677,041
--------------- -------- ---------- ---------- -------- ---------- ----------
Under the terms of a revised investment management
agreement dated 29 March 2010, Mobeus Equity
Partners LLP ("Mobeus") (formerly Matrix
Private Equity Partners LLP ("MPEP")) provides
investment advisory, administrative and company
secretarial services to the Company, for
a fee of 2.4% per annum of closing net assets,
calculated on a quarterly basis by reference
to the net assets at the end of the preceding
quarter. One sixth of this fee is subject
to minimum and maximum limits of GBP150,000
(2016: GBP150,000) and GBP170,000 (2016:
GBP170,000) per annum respectively.
The Investment Adviser fees disclosed above
are stated after applying a cap on expenses
excluding IFA trail commission and exceptional
items set at 3.25% of closing net assets
at the year-end. In accordance with the investment
management agreement any excess expenses
are wholly borne by the Investment Adviser.
The excess expenses during the year attributable
to the Investment Adviser amounted to GBPnil
(2016: GBPnil)
b) Investment Advisers' performance fees
Revenue Capital Total Revenue Capital Total
2017 2017 2017 2016 2016 2016
Portfolio GBP GBP GBP GBP GBP GBP
Mobeus Equity
Partners LLP - 571,879 571,879 - 1,096,391 1,096,391
Foresight Group
LLP - - - - 43,830 43,830
- 571,879 571,879 - 1,140,221 1,140,221
---------------------------- -------- -------- -------- ---------- ----------
Under a Deed of Termination and Variation relating
to Performance Incentive Agreements dated 29
March 2010, the Investment Adviser's Incentive
Agreement for the former 'O' Share Fund was
continued, while the former 'S' Share Fund's
Incentive Agreement was terminated. Under the
terms of the pre-merger 'O' Share Fund Incentive
Agreement, each of the ongoing Investment Adviser,
Mobeus Equity Partners LLP and a former Investment
Adviser, Foresight Group LLP ("Foresight")
are entitled to a performance fee equal to
20% of the excess of the value of any realisation
of an investment made after 30 June 2007, over
the value of that investment in an Investment
Adviser's portfolio at that date ("the Embedded
Value"), which value is itself uplifted at
the rate of 6% per annum subject to a High
Watermark test.
On 30 September 2014, a new incentive fee agreement
was signed between the Board and Mobeus, with
effect from 1 October 2013, to amend and replace
the previous agreement. The previous agreement
remains in force, but only with the former
adviser, Foresight Group LLP, to whom, for
the year ended 30 September 2017, GBPnil (2016:
GBP43,830) is payable. The agreement is due
to expire on 10 March 2019. Mobeus waived their
right to their portion of the fee, under the
previous agreement.
Any payment under the new incentive agreement
is now 15% of net realised gains for each year,
payable in cash. It is payable only if Cumulative
Net Asset Value (NAV) total return per share
(being the closing NAV at a year-end plus cumulative
dividends paid to that year-end, since 1 October
2013) equals or exceeds a Target Return. The
Target Return is the greater of two targets,
being:
i) compound growth of 6% per annum (but 5%
per annum for the year ended 30 September 2014
only), before deducting any incentive fee payable
(for the year of calculation only) under both
this amended agreement and the existing incentive
agreement with Foresight Group LLP in Cumulative
NAV total return per share; or
ii) the cumulative percentage change in the
Consumer Prices Index since 1 October 2013
to the relevant financial year end, the resultant
figure then being multiplied by (100+A)/100,
where A is the number of full 12 month periods
(or part thereof) that have passed between
1 October 2013 and the relevant financial year
end.
Both measures of Target Return are applied
to the same opening base, being NAV per share
as at 30 September 2013 of 113.90 pence. The
objective of this Target Return is to enable
shareholders to benefit from a cumulative NAV
return of at least 6% per annum (5% in the
financial year ended 30 September 2014), before
any incentive fee is payable. Once a payment
has been made, cumulative NAV total return
is calculated after deducting past years' incentive
fees paid and payable.
Under this amended agreement, any fee payments
to Mobeus are subject to an annual cap of an
amount equal to 2% of the net assets of the
Company as at the immediately preceding year-end.
This cap will include any fee payable to Foresight
Group LLP under the old agreement, although
any such payment to Foresight Group LLP is
not capped. Any excess over the 2% remains
payable to Mobeus in the following year(s),
subject to the 2% annual cap in such subsequent
year(s) and after any payment in respect of
such subsequent year(s).
The Target Return for the year ended 30 September
2017 was a 6% uplift on the previous year's
Target Return of 134.38 pence, being 142.44
pence. As Cumulative Total NAV return is 144.00
pence per share, the Target Return has been
met and a fee is payable. This fee amounts
to GBP571,879 and has been accrued in these
accounts. This is payable following the approval
of this Annual Report by shareholders at the
AGM.
c) Offer for Subscription fees
2017 2016
GBPm GBPm
Funds raised by I&G VCT 2.99 -
------------------------------ ----- -----
Offer costs payable to Mobeus
at 3.25% of funds raised by
I&G VCT 0.10 -
------------------------------ ----- -----
Under the terms of an Offer for Subscription,
with the other Mobeus advised VCTs, launched
on 6 September 2017, Mobeus is entitled to
fees of 3.25% of the investment amount received
from investors. This amount totalled GBP341,500
for the first allotment on 28 September 2017
across all four VCTs, out of which all the
costs associated with the allotment were
met, excluding any payments to advisers facilitated
under the terms of the Offer.
5 Taxation on ordinary activities
The tax expense for the year comprises current
tax and is recognised in profit or loss. The
current income tax charge is calculated on
the basis of tax rates and laws that have
been enacted or substantively enacted by the
reporting date.
Any tax relief obtained in respect of adviser
fees allocated to capital is reflected in
the capital reserve - realised and a corresponding
amount is charged against revenue. The tax
relief is the amount by which corporation
tax payable is reduced as a result of these
capital expenses.
Deferred tax is recognised in respect of all
timing differences that have originated but
not reversed at the balance sheet date where
transactions or events that result in an obligation
to pay more tax in the future or a right to
pay less tax in the future have occurred at
the balance sheet date. Timing differences
are differences between the Company's taxable
profits and its results as stated in the financial
statements that arise from the inclusion of
gains and losses in the tax assessments in
periods different from those in which they
are recognised in the Financial Statements.
Deferred tax is measured at the average tax
rates that are expected to apply in the years
in which the timing differences are expected
to reverse based on tax rates and laws that
have been enacted or substantively enacted
at the balance sheet date. Deferred tax is
measured on a non-discounted basis.
A deferred tax asset would be recognised only
to the extent that it is more likely than
not that future taxable profits will be available
against which the asset can be utilised. No
deferred tax asset has been recognised due
to the uncertainty of available future taxable
profits.
2017 2017 2017 2016 2016 2016
Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
a) Analysis of
tax charge:
UK Corporation
tax on profits/(losses)
for the year 421,283 (421,283) - 479,600 (479,600) -
--------------------------- ---------- ---------- ---------- ---------- ---------- ----------
Total current
tax charge/(credit) 421,283 (421,283) - 479,600 (479,600) -
--------------------------- ---------- ---------- ---------- ---------- ---------- ----------
Corporation tax
is based on a
rate of 19.5%
(2016: 20.0%)
b) Profit on
ordinary activities
before tax 2,449,268 1,335,906 3,785,174 2,390,141 658,033 3,048,174
Profit on ordinary
activities multiplied
by main company
rate of corporation
tax in the UK
of 19.5% (2016:
20.0%) 477,607 260,502 738,109 478,028 131,607 609,635
Effect of:
UK dividends (56,324) - (56,324) (22,983) - (22,983)
Unrealised losses
not allowable/(gains
not taxable) - 154,831 154,831 - (109,978) (109,978)
Realised gains
not taxable - (757,347) (757,347) - (501,229) (501,229)
Losses (utilised)/carried
forward - (79,269) (79,269) 24,555 - 24,555
--------------------------- ----------
Actual current
tax charge 421,283 (421,283) - 479,600 (479,600) -
--------------------------- ---------- ---------- ---------- ---------- ---------- ----------
Tax relief relating to Investment Adviser fees
is allocated between revenue and capital where
such relief can be utilised. The rate of corporation
tax applied to the company has reduced due to
a reduction in HMRC's main company rate of corporation
tax to 19% on 1 April 2017, from the previous
rate of 20%.
No asset or liability has been recognised for
deferred tax in relation to capital gains or
losses on revaluing investments as the Company
is exempt from corporation tax in relation to
capital gains or losses as a result of qualifying
as a Venture Capital Trust.
There is no potential liability to deferred
tax (2016: GBPnil). There is an unrecognised
deferred tax asset of GBP965,000 (2016: GBP1,034,000).
6 Basic and diluted earnings and return per share
2017 2016
GBP GBP
Total earnings after taxation: 3,785,174 3,048,174
Basic and diluted earnings
per share (note a) 5.21p 4.28p
--------------------------------------- --------------------------------- ----------------------
Revenue profit from ordinary
activities after taxation 2,027,985 1,910,541
Basic and diluted revenue
earnings per share (note
b) 2.79p 2.68p
--------------------------------------- --------------------------------- ----------------------
Net unrealised capital (losses)/gains
on investments (794,007) 549,889
Net realised capital gains
on investments 3,883,829 2,506,146
Capitalised Investment Adviser
fees and performance fees
less taxation (1,332,633) (1,918,402)
--------------------------------------- --------------------------------- ----------------------
Total capital return 1,757,189 1,137,633
Basic and diluted capital
earnings per share (note
c) 2.42p 1.60p
--------------------------------------- --------------------------------- ----------------------
Weighted average number
of shares in issue in the
year 72,621,839 71,198,046
--------------------------------------- --------------------------------- ----------------------
Notes:
a) Basic earnings per share is total earnings
after taxation divided by the weighted average
number of shares in issue.
b) Revenue earnings per share is the revenue
return after taxation divided by the weighted
average number of shares in issue.
c) Capital earnings per share is the total
capital return after taxation divided by the
weighted average number of shares in issue.
7 Dividends paid and payable
Dividends payable are recognised as distributions
in the financial statements when the Company's
liability to pay them has been established.
This liability is established for interim
dividends when they are paid, and for final
dividends when they are approved by the shareholders,
usually at the Company's Annual General Meeting.
The Company's status as a VCT means it has
to comply with Section 259 of the Income Tax
Act 2007, which requires that no more than
15% of the income from shares and securities
in a year can be retained from the revenue
available for distribution for the year. Accordingly,
the Board is required to determine the amount
of minimum income dividend.
Amounts recognised as distributions
to equity shareholders in the
year:
For the Pence Date Paid 2017 2016
year per GBP GBP
ended share
30 September
15 February
Final Income 2015 1.00p 2016 - 706,921
15 February
Final Capital 2015 5.00p 2016 - 3,534,606
07 July
Interim Income 2016 1.00p 2016 - 1,067,478
07 July
Interim Capital 2016 5.00p 2016 - 3,202,433
15 February
Final Income 2016 1.00p 2017 718,814 -
15 February
Final Capital 2016 3.00p 2017 2,156,442 -
20 June
Interim Income 2017 1.50p 2017 1,087,032 -
20 June
Interim Capital 2017 1.50p 2017 1,087,032 -
31 August
Special Capital 2017 15.00p 2017 10,931,992 -
Previous dividends not claimed
within the statutory period (5,232)
------------------------------------------------------------ ------------------------ ---------------------
15,981,312(1) 8,506,206
----------------------------------- ------- ------------ ------------------------ ---------------------
(1) - GBP15,981,312 (30 September 2016: GBP8,506,206)
disclosed above differs to that shown in the
Statement of Cash Flows of GBP13,062,948;
(30 September 2016: GBP7,160,312) due to GBP2,918,364
(30 September 2016: GBP1,345,894) of new shares
issued as part of the Company's Dividend Investment
Scheme.
2017 2017 2017 2016 2016 2016
Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
Proposed distribution
to equity holders
at the year-end
Final dividend for
the year ended 30
September 2017 of
0.50p (income) (2016:
1.00p), 2.50p (capital)
(2016: 3.00p) per
ordinary share 473,245 2,366,229 2,839,474 719,140 2,157,421 2,876,561
-------------------------- -------- ---------- ---------- -------- ---------- ----------
Any proposed final dividend is subject to approval
by shareholders at the Annual General Meeting
and has not been included as a liability in
these financial statements.
Set out below are the total income dividends
payable in respect of the financial year, which
is the basis on which the requirements of section
274 of the Income Tax Act 2007 are considered.
2017 2016
GBP GBP
Revenue available by way of dividends
for the year 2,027,985 1,910,541
--------------------------------------- ---------- ----------
Interim income dividend for the
year - 1.50p (2016: 1.00p) 1,087,032 1,067,478
Proposed final income dividend
for the year - 0.50p (2016: 1.00
p) 473,425 719,140
--------------------------------------- ---------- ----------
Total income dividends for the
year 1,560,457 1,786,618
--------------------------------------- ---------- ----------
8 Investments at fair value
The most critical estimates, assumptions and
judgements relate to the determination of the
carrying value of investments at "fair value
through profit and loss" (FVTPL). All investments
held by the Company are classified as FVTPL
and measured in accordance with the International
Private Equity and Venture Capital Valuation
("IPEV") guidelines, as updated in December
2015. This classification is followed as the
Company's business is to invest in financial
assets with a view to profiting from their
total return in the form of capital growth
and income.
For investments actively traded on organised
financial markets, fair value is generally
determined by reference to Stock Exchange market
quoted bid prices at the close of business
on the balance sheet date. Purchases and sales
of quoted investments are recognised on the
trade date where a contract of sale exists
whose terms require delivery within a time
frame determined by the relevant market. Purchases
and sales of unlisted investments are recognised
when the contract for acquisition or sale becomes
unconditional.
Unquoted investments are stated at fair value
by the Directors in accordance with the following
rules, which are consistent with the IPEV guidelines:
All investments are held at the price of a
recent investment for an appropriate period
where there is considered to have been no change
in fair value. Where such a basis is no longer
considered appropriate, each investment is
considered as a whole on a 'unit of account'
basis, alongside consideration of:
(i) Where a value is indicated by a material
arms-length transaction by an independent third
party in the shares of a company, this value
will be used.
(ii) In the absence of i) and depending upon
both the subsequent trading performance and
investment structure of an investee company,
the valuation basis will usually move to either:-
a) a multiple basis. The shares may be valued
by applying a suitable price-earnings ratio
or revenue multiple to that company's historic,
current or forecast post-tax earnings before
interest and amortisation, or revenue, (the
ratio used being based on a comparable sector
but the resulting value being adjusted to reflect
points of difference identified by the Investment
Adviser compared to the sector including, inter
alia, a lack of marketability).
or:-
b) where a company's underperformance against
plan indicates a diminution in the value of
the investment, provision against cost is made,
as appropriate.
(iii) Premiums, to the extent that they are
considered capital in nature, and that they
will be received upon repayment of loan stock
investments are accrued at fair value when
the Company receives the right to the premium
and when considered recoverable.
(iv) Where an earnings or revenue multiple
or cost less impairment basis is not appropriate
and overriding factors apply, a discounted
cash flow, net asset valuation or realisation
proceeds basis may be applied.
Capital gains and losses on investments, whether
realised or unrealised, are dealt with in the
profit and loss and revaluation reserves and
movements in the period are shown in the Income
Statement.
All investments are initially recognised and
subsequently measured at fair value. Changes
in fair value are recognised in the Income
Statement.
A key judgement made in applying the above
accounting policy relates to investments that
are permanently impaired. Where the value of
an investment has fallen permanently below
cost, the loss is treated as a permanent impairment
and as a realised loss, even though the investment
is still held. The Board assesses the portfolio
for such investments and, after agreement with
the Investment Adviser, will agree the values
that represent the extent to which an investment
loss has become realised. This is based upon
an assessment of objective evidence of that
investment's future prospects, to determine
whether there is potential for the investment
to recover in value.
The methods of fair value measurement are classified
into hierarchy based on the reliability of
the information used to determine the valuation.
- Level 1 - Fair value is measured based on
quoted prices in an active market.
* Level 2 - Fair value is measured based on directly
observable current market prices or indirectly being
derived from market prices.
* Level 3 - Fair value is measured using valuation
techniques using inputs that are not based on
observable market data.
Movements in investments during the year are summarised as follows:
Unquoted Unquoted
Traded equity preference Unquoted
on Loan
AIM shares shares Stock Total
GBP GBP GBP GBP GBP
--------------------------- ---------- ------------ ----------- ------------- -------------
Cost at 30 September
2016 1,333,907 18,112,271 27,341 34,392,604 53,866,123
Permanent impairment
at 30 September
2016 (500,000) (3,467,312) (787) (227,462) (4,195,561)
Unrealised gains/(losses)
at 30 September
2016 2,376,651 (2,507,427) (3,908) 4,829,080 4,694,396
-------------
Valuation at 30
September 2016 3,210,558 12,137,532 22,646 38,994,222 54,364,958
Purchases at cost - 4,745,463 - 558,771 5,304,234
Sale proceeds (note
a) - (4,552,845) (1,671) (10,174,190) (14,728,706)
Reclassification
at value (note
b) - 437,022 87 (437,109) -
Realised gains
on investments - 1,494,881 1,671 2,387,277 3,883,829
Unrealised (losses)/gains
on investments
(note c) (13,381) 91,438 391,453 (1,263,517) (794,007)
---------------------------
Valuation at 30
September 2017 3,197,177 14,353,491 414,186 30,065,454 48,030,308
--------------------------- ---------- ------------ ----------- ------------- -------------
Cost at 30 September
2017 1,333,907 21,758,149 25,757 27,540,446 50,658,259
Permanent impairment
at 30 September
2017 (note c) (500,000) (6,011,453) - (87,187) (6,598,640)
Unrealised gains/(losses)
at 30 September
2017 (note e) 2,363,270 (1,393,205) 388,429 2,612,195 3,970,689
Valuation at 30
September 2017 3,197,177 14,353,491 414,186 30,065,454 48,030,308
--------------------------- ---------- ------------ ----------- ------------- -------------
A full breakdown of the increases and decreases
in unrealised valuations of the portfolio is
seen in the Investment Portfolio Summary in
the Annual Report.
Major movements in investments
Note a) Disposals of investment portfolio companies during the year were:
Company Type Investment Disposal Valuation Realised
Cost Proceeds at 30 gain
September in
2016 year
GBP GBP GBP GBP
Entanet Holdings
Limited(1) Realisation 3,175,171 7,166,414 3,351,685 3,814,729
Manufacturing
Services
Investment
Limited Share buyback 668,400 668,400 668,400 -
Chatfield Share buyback
Services and loan
Limited repayment 778,774 778,774 778,774 -
Backhouse
Management
Limited Loan repayment 721,920 1,203,200 721,920 - (1)
Barham Consulting
Limited Loan repayment 721,920 1,203,200 721,920 - (1)
Creasy Marketing
Services
Limited Loan repayment 721,920 1,203,200 721,920 - (1)
McGrigor
Management
Limited Loan repayment 721,920 1,203,200 721,920 - (1)
Hollydale
Management
Limited Loan repayment 559,440 932,400 559,440 - (1)
Others 442,633 369,918 300,818 69,100
-------------------------------------
8,512,098 14,728,706 8,546,797 3,883,829
------------------------------------ ----------- ----------- ----------- --------------------
(1) - Deferred contingent consideration of GBP0.74
million is potentially payable over the next
two years. There are conditions attached to
this deferred consideration such that the amount
receivable is uncertain and so has not been
recognised in the current year's financial statements.
(2) - The gain on the loan repayments above
of GBP2,298,080 has been set off against an
equivalent permanent impairment in the equity
instrument of the investments in these companies
(see note c). Thus, no gain or loss resulted.
Note b) During the year, two investee companies
were reorganised whereby loan stocks held at
a value of GBP437,109 were reclassified as ordinary
shares, and ordinary shares of value GBP87 were
reclassified as preference shares.
Note c) Within net unrealised losses of GBP794,007
for the year, the significant falls in value
compared to last year were as follows: GBP966,297
in Jablite Holdings Limited, GBP466,776 in CGI
Creative Graphics International Limited, GBP414,087
in Fullfield Limited (trading as Motorclean),
GBP545,478 in Veritek Global Limited and GBP536,753
in Media Business Insight Holdings Limited.
These losses were partially offset by unrealised
gains in valuation compared to last year, including:
GBP954,816 in Gro Group Holdings Limited, GBP500,337
in Master Removers Group Limited (formerly Leap
New Co), GBP347,280 in Tovey Management Limited
(trading as Access IS), GBP314,572 in EOTH Limited
and GBP298,666 in Vectair Holdings.
The decrease in unrealised valuations of the
loan stock investments above reflect the changes
in the entitlements to loan premiums, and/or
in the underlying enterprise value of the investee
company. The decrease does not arise from assessments
of credit risk or market risk upon these investments.
Note d) During the year, permanent impairments
of the cost of investments have increased from
GBP4,195,561 to GBP6,598,640. The increase of
GBP2,403,079 is due to the impairments of equity
of five investee companies referred to in note
2 to note a) above, and the impairment of GBP104,999
of another company's remaining investment cost.
Note e) The figure of unrealised gains as at
30 September 2017 of GBP3,970,689 is lower than
shown on the Statement of Changes in Equity
of GBP4,020,689 by GBP50,000. This is caused
by GBP50,000 of contingent consideration at
the Balance Sheet date, shown as other debtors
in Note 11 to the Financial Statements in the
Annual Report.
Provisions and write-offs against unlisted investments
The amounts provided below cost at the end of the year or written-off against unlisted investments were as follows:
Total Provisions Net write-offs
at end of year in year(1)
Financial Year GBP GBP
2017 13,528,607 2,403,079
2016 11,500,860 (1,115,371)
2015 9,793,793 65,779
2014 7,709,509 (1,876,253)
2013 10,475,290 2,001,476
2012 11,991,733 313,850
2011 11,206,678 1,881,554
2010 11,575,422 2,524,527
(1) - GBP2,403,079 of the cost of six investments were permanently impaired in the year.
9 Current asset investments and Cash at bank
Cash equivalents, for the purposes of the
Statement of Cash Flows, comprise bank deposits
repayable on up to three months' notice and
funds held in OEIC money-market funds. Current
asset investments are the same but also include
bank deposits that mature after three months.
Current asset investments are disposable without
curtailing or disrupting the business and
are readily convertible into known amounts
of cash at their carrying values at immediate
or up to one year's notice. Cash, for the
purposes of the Statement of Cash Flows is
cash held with banks in accounts subject to
immediate access. Cash at bank in the Balance
Sheet is the same.
Current asset investments
and Cash at bank
2017 2016
GBP GBP
OEIC Money market funds 9,260,902 10,158,055
Cash equivalents per Statement
of Cash Flows 9,260,902 10,158,055
Bank deposits that mature
after three months 3,151,769 5,180,012
-------------------------------- ----------- -----------
Current asset investments 12,412,671 15,338,067
-------------------------------- ----------- -----------
Cash at bank 1,375,065 2,189,856
-------------------------------- ----------- -----------
10 Called up share capital
2017 2016
GBP GBP
Allotted, called-up and
fully paid:
Ordinary Shares of 1p
each: 79,204,702 (2016:
71,914,023) 792,047 719,140
Total 792,047 719,140
--------------------------- -------- --------
Under the Offer for Subscription launched on
6 September 2017, a total of 3,627,706 ordinary
shares were allotted at an average effective
offer price of 82.49 pence per share, raising
net funds of GBP2,946,210, after GBP45,529
offer costs have been deducted.
Under the terms of the Dividend Investment
Scheme, a total of 3,865,859 (2016: 1,490,729)
ordinary shares were allotted during the year
for a total consideration of GBP2,918,364 (2016:
GBP1,345,892).
During the year, the Company purchased 202,886
(2016: 269,713) of its own ordinary shares
for cash (representing 0.3% (2016: 0.4%) of
the ordinary shares in issue at the start of
the year) at the prevailing market price for
a total cost of GBP160,323 (2016: GBP249,518).
The shares bought back were subsequently cancelled.
11 Basic and diluted net asset value per share
2017 2016
GBP GBP
Net assets 64,348,757 70,840,638
Number of shares
in issue 79,204,702 71,914,023
---------------------- ----------- -----------
Basic and diluted
net asset value per
share 81.24p 98.51p
---------------------- ----------- -----------
12 Post balance sheet events
On 20 October 2017, 7,167,226 ordinary shares
were allotted under the Company's Offer for
Subscription, raising net funds of GBP5.82
million for the Company.
On 23 October 2017, the Company announced its
intention to utilise its overallotment facility
and is now seeking to raise up to GBP25.00
million.
On 1 November 2017 and 2 November 2017, TPSFF
Holdings Limited made loan repayments of GBP0.04
million and GBP0.05 million.
On 9 November 2017, 5,214,308 ordinary shares
were allotted under the Company's Offer for
Subscription, raising net funds of GBP4.23
million.
On 20 November 2017, 1,978,451 ordinary shares
were allotted under the Company's Offer for
Subscription, raising net funds of GBP1.61
million.
On 21 November 2017, 1,084,462 ordinary shares
were allotted under the Company's Offer for
Subscription, raising net funds of GBP0.88
million.
On 21 November 2017, a further GBP0.09 million
was invested in BookingTek Limited.
On 5 December 2017, a further GBP0.15 million
was invested in Mpb Group Limited.
On 5 December 2017, an amount of GBP0.12 million
was received from Alaric Systems Limited, an
investment realised in a previous year.
Statutory information
The financial information set out in these statements
does not constitute the Company's statutory
accounts for the year ended 30 September 2017
but is derived from those accounts. Statutory
accounts will be delivered to the Registrar
of Companies after the Annual General Meeting.
The auditors have reported on these accounts
and their report was unqualified and did not
contain a statement under section 498(2) of
the Companies Act 2006.
Annual Report
The Annual Report will be published on the Company's
website at www.incomeandgrowthvct.co.uk shortly
and following the adoption of electronic communications
by the Company, shareholders will shortly receive
notification from the Company on how to download
a pdf of the Report from the website. Shareholders
and members of the public who wish to receive
a hard copy of the Annual Report, may request
a copy by writing to the Company Secretary,
Mobeus Equity Partners LLP, 30 Haymarket (4th
floor), London SW1Y 4EX or by email: vcts@mobeusequity.co.uk.
Annual General Meeting
The Annual General Meeting of the Company will
be held at 11.00 am on Wednesday, 7 February
2018 at The Clubhouse, 8 St James's Square,
London, SW1Y 4JU.
Contact details for further enquiries:
Robert King or Robert Brittain of Mobeus Equity
Partners LLP (the Company Secretary) on 020
7024 7600 or by e-mail to vcts@mobeusequity.co.uk.
Mark Wignall or Mike Walker at Mobeus Equity
Partners LLP (the Investment Adviser) on 020
7024 7600 or by e-mail to info@mobeusequity.co.uk.
DISCLAIMER
Neither the contents of the Company's website
nor the contents of any website accessible from
hyperlinks on the Company's website (or any
other website) is incorporated into, or forms
part of, this announcement.
FR OKBDBBBDDOBD
(END) Dow Jones Newswires
December 12, 2017 07:41 ET (12:41 GMT)
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