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Share Name Share Symbol Market Type Share ISIN Share Description
Kings Arms Yard Vct Plc LSE:KAY London Ordinary Share GB0007174294 ORD 1P
  Price Change % Change Share Price Bid Price Offer Price High Price Low Price Open Price Shares Traded Last Trade
  0.00 0.0% 20.30 19.80 20.80 20.30 20.30 20.30 0.00 01:00:00
Industry Sector Turnover (m) Profit (m) EPS - Basic PE Ratio Market Cap (m)
Equity Investment Instruments 1.9 1.2 0.3 63.4 90

Kings Arms Yard Kings Arms Yard Vct Plc: Annual Financial Report

26/03/2021 6:47pm

UK Regulatory (RNS & others)


 
TIDMKAY 
 
   Kings Arms Yard VCT PLC 
 
   LEI Code 213800DK8H27QY3J5R45 
 
   As required by the UK Listing Authority's Disclosure Guidance and 
Transparency Rules 4.1 and 6.3, Kings Arms Yard VCT PLC today makes 
public its information relating to the Annual Report and Financial 
Statements for the year ended 31 December 2020. 
 
   The announcement was approved for release by the Board of Directors on 
26 March 2021. 
 
   This announcement has not been audited. 
 
   The Annual Report and Financial Statements for the year ended 31 
December 2020 (which have been audited), will shortly be sent to 
shareholders. Copies of the full Annual Report and Financial Statements 
will be shown via the Albion Capital Group LLP website by clicking 
https://www.globenewswire.com/Tracker?data=IeaQ627d2CsGwLaH7G-fn1rTKtV44hImf4qCvoti41Tf0JNbnyzaXB03QO6DUX43ZkbcXJLXW3QYi3WElID5N83V_kGj_egcrxoVqJ0IvSKDKMs77N4OzyXu5EoOgnrX9xKjSDwu3V9j87C8uw-NWlZTdVGVED-qFnPx30w7ui8= 
www.albion.capital/funds/KAY/31Dec2020.pdf. 
 
   The information contained in the Annual Report and Financial Statements 
will include information as required by the Disclosure Guidance and 
Transparency Rule's, including Rule 4.1. 
 
   Investment policy 
 
   Kings Arms Yard VCT PLC is a Venture Capital Trust and the investment 
policy is intended to produce a regular and predictable dividend stream 
with an appreciation in capital value. 
 
   The Company will invest in a broad portfolio of higher growth businesses 
across a variety of sectors of the UK economy including higher risk 
technology companies. Allocation of assets will be determined by the 
investment opportunities which become available but efforts will be made 
to ensure that the portfolio is diversified both in terms of sector and 
stage of maturity of company. 
 
   Funds held pending investment or for liquidity purposes are held as cash 
on deposit or similar instruments with banks or other financial 
institutions with high credit ratings assigned by international credit 
rating agencies. 
 
   Risk diversification and maximum exposures 
 
   Risk is spread by investing in a number of different businesses within 
venture capital trust qualifying industry sectors using a mixture of 
securities. The maximum amount which the Company will invest in a single 
portfolio company is 15 per cent. of the Company's assets at cost, thus 
ensuring a spread of investment risk. The value of an individual 
investment may increase over time as a result of trading progress and it 
is possible that it may grow in value to a point where it represents a 
significantly higher proportion of total assets prior to a realisation 
opportunity being available. 
 
   The Company's maximum exposure in relation to gearing is restricted to 
the amount equal to its adjusted capital and reserves. 
 
   Financial calendar 
 
 
 
 
Record date for first dividend                                 16 April 2021 
Payment date for first dividend                                30 April 2021 
Annual General Meeting                                  Noon on 10 June 2021 
Announcement of half-yearly results for the six months        September 2021 
 ending 30 June 2021 
 
 
   Financial highlights 
 
 
 
 
21.84p   Net asset value per share as at 31 December 2020 
        --------------------------------------------------- 
 
0.91p    Basic and diluted return per share 
        --------------------------------------------------- 
 
1.11p   Total tax free dividends per share paid in the year 
         to 31 December 2020 
        --------------------------------------------------- 
 
0.60p    First tax free dividend per share declared for the 
          year to 31 December 2021 payable on 30 April 2021 
        --------------------------------------------------- 
 
4.24%   Shareholder return for the year ended 31 December 
         2020 
        --------------------------------------------------- 
 
   Shareholder return is calculated by the movement in total shareholder 
value for the year divided by the opening net asset value. 
 
 
 
 
                           31 December 2020 (pence    31 December 2019 (pence 
                                  per share)                per share) 
Opening net asset value                       22.02                      22.78 
Capital return/(loss)                          0.59                     (0.02) 
Revenue return                                 0.32                       0.44 
                           ------------------------  ------------------------- 
Total return                                   0.91                       0.42 
Dividends paid                               (1.11)                     (1.20) 
Impact from share capital 
 movements                                     0.02                       0.02 
                           ------------------------  ------------------------- 
Net asset value                               21.84                      22.02 
-------------------------  ------------------------  ------------------------- 
 
 
 
 
 
 
 
  Shareholder return and shareholder value                      (pence per share) 
Shareholder return from launch to 1 January 2011 
Subscription price per share at launch                                     100.00 
Total dividends paid to 1 January 2011                                      58.66 
Decrease in net asset value                                               (83.40) 
                                                              ------------------- 
Total shareholder value to 1 January 2011                                   75.26 
                                                              ------------------- 
 
Shareholder return from 1 January 2011 to 31 December 
 2020 (period that Albion Capital has been investment 
 manager): 
Total dividends paid                                                        10.18 
Increase in net asset value                                                  5.24 
                                                              ------------------- 
Total shareholder return from 1 January 2011 to 31 
 December 2020                                                              15.42 
--------------------------------------------------------      ------------------- 
 
Shareholder value since launch: 
Total dividends paid to 31 December 2020                                    68.84 
Net asset value as at 31 December 2020                                      21.84 
                                                              ------------------- 
Total shareholder value as at 31 December 2020                              90.68 
------------------------------------------------------------  ------------------- 
 
 
   The Directors have declared a first dividend of 0.60 pence per share for 
the year ending 31 December 2021, which will be paid on 30 April 2021 to 
shareholders on the register on 16 April 2021. 
 
   The above financial summary is for the Company, Kings Arms Yard VCT PLC 
only. Details of the financial performance of the various Quester, SPARK 
and Kings Arms Yard VCT 2 PLC companies, which have been merged into the 
Company, can be found at 
https://www.globenewswire.com/Tracker?data=IeaQ627d2CsGwLaH7G-fn1rTKtV44hImf4qCvoti41TM2uULHJe2qXD3rnGBOjMW7ugCavQn379K_R5pMzaaHftLhqMxwlLw7QDdDH4hLeGviMd29_jGoSiohzj82pQG 
www.albion.capital/funds/KAY under the 'Financial summary for previous 
funds' section. 
 
   Chairman's statement 
 
   Introduction 
 
   The Covid-19 pandemic made 2020 a challenging year for every business 
but our Company has emerged in a stronger state than might have been 
predicted twelve months ago, with a positive return on our opening net 
asset value. As I will elaborate below, the proportion of our assets 
held in the legacy portfolio selected by previous managers has declined 
to less than 9% of our total and the remainder of our portfolio, 
selected since January 2011, has performed strongly. Within 2020 and 
since the year end we have seen some significant improvements in value 
and a number of very positive asset realisations. 
 
   Results and performance 
 
   The total return for the year was 0.91 pence per share, which is a 4.2% 
return on opening net asset value (excluding dividends paid). Realised 
and unrealised gains on investments amounted to GBP3.3 million for the 
year. Key contributors were the uplifts in the valuations of Proveca 
(GBP2.4m), which continues to trade well both within the UK and EU, 
OmPrompt Holdings (GBP1.7m), which was sold after the year end, and 
Quantexa (GBP1.6m), which has been revalued after a successful further 
funding round. This was offset by write downs in Perpetuum (GBP1.8m) and 
Elateral Group (GBP1.2m). 
 
   Net asset value per share decreased by 0.18 pence to 21.84 pence over 
the year to 31 December 2020, after allowing for the payment of 
dividends totalling 1.11 pence per share. It is worthy of note that this 
aggregate performance was the result of an overall gain of 1.81 pence 
per share from investments made since the appointment of Albion Capital 
as Manager in January 2011 and a loss of 0.91 pence per share from the 
continually shrinking legacy portfolio. 
 
   Investment realisations 
 
   The sale of G.Network Communications has been completed, with a strong 
headline total return of 3.8 times cost, although the terms of the sale 
will see proceeds being received in three years' time. In the current 
year, this still reflects a substantial GBP0.9 million of realised gains, 
with the proceeds having been appropriately discounted. Another strong 
exit returning 2.1 times cost was our holding in Clear Review, which was 
sold to Advanced Computer Software Group. Further details on 
realisations can be found in the realisations table on page 25 of the 
full Annual Report and Financial Statements. 
 
   Following the year end, in March 2021, the Company completed the sale of 
its three care homes for the elderly; Active Lives Care, Ryefield Court 
Care, and Shinfield Lodge Care. These homes were trading at mature 
occupancy levels. The first investments in the homes were made over 5 
years ago and the sale will generate a 2.4 times return on cost 
(including interest received) and an internal rate of return of 20% 
p.a., an excellent result for the Company. The Company also completed 
the sale of OmPrompt Holdings in March 2021 realising proceeds of GBP3.0 
million. If the full escrow amount is received, we will have generated a 
2.6 times return on cost (including interest received) and an internal 
rate of return of 19% p.a.. 
 
   Following these investment realisations, which result in a significant 
cash holding, the Company is well placed to take advantage of the strong 
pipeline of investment opportunities which have been, and will be, 
identified by the Manager. The Board intends to monitor the new 
investment activity, and the requirement to comply with the HMRC 80% 
qualifying investments level, over the coming months. An update will be 
provided to shareholders in the Half-yearly Financial Report, including 
the potential payment of a special dividend. 
 
   Portfolio 
 
   The Company holds a widely diversified selection of businesses, with key 
investments in the healthcare (including digital healthcare), renewable 
energy, software and other technology sectors. 
 
   During the year a total of GBP4.0 million was invested into new and 
existing portfolio companies. Of this, GBP1.6 million was invested into 
6 new portfolio companies, the majority of which are software 
businesses. Follow on investments were made into 12 existing portfolio 
companies and accounted for GBP2.4 million of cash. 
 
   The portfolio now comprises a total of 66 companies of which 13 are 
legacy investments made before the present Manager was appointed in 
January 2011. 
 
   The Board has reassessed the carrying value of all portfolio investments 
and has revalued those wherever trading performance or market conditions 
made this appropriate. The overall outcome shows a net positive gain on 
investments of GBP3.3 million. 
 
   For a detailed review of these additions, disposals and other 
developments in the business please see the Strategic report below. 
 
   Dividend 
 
   The Company paid dividends totalling 1.11 pence per share during the 
year ended 31 December 2020 (2019: 1.20 pence per share). 
 
   As set out in the Half yearly Financial Report to 30 June 2020, the 
Board considered it appropriate to move to a variable dividend policy 
targeting an annual dividend yield of around 5%, based on prevailing net 
asset value rather than at a fixed rate, as it has been in the past. 
Semi-annual dividends are intended to be calculated as 2.5% of the most 
recently announced net asset value when the dividend is declared (in 
most cases this will be the net asset value announced in the Half-yearly 
Financial Report or in the Annual Report and Financial Statements). 
 
   The Board is therefore pleased to declare a first dividend for the year 
ending 31 December 2021 of 0.60 pence per share (2020: 0.60 pence per 
share) being 2.5% of the net asset value rounded up to the nearest tenth 
of a penny to be paid on 30 April 2021 to shareholders on the register 
on 16 April 2021. In declaring this dividend the Board is very conscious 
of our target annual dividend yield of 5% and of the positive 
developments since the year end. 
 
   Board continuity 
 
   This year's AGM will mark my 12th anniversary as Chairman of this 
Company and I will be stepping down at the end of the General Meeting. I 
am delighted to say that Fiona Wollocombe has agreed to take the Chair 
on my departure. Kings Arms Yard is now a very different company from 
that of which I joined the Board in 2009, and I would like to take this 
opportunity to thank my board colleagues and our Manager, Albion Capital, 
for all they have done to make it the thriving investment opportunity 
that I now believe it to be. 
 
   In order to provide the Board with more capacity for succession planning, 
a resolution is being proposed at the forthcoming Annual General Meeting 
("AGM") to increase the cap on Directors remuneration from GBP100,000 to 
GBP125,000 per annum. There is no current intention of increasing 
Directors fees materially in the near term, but the new level proposed 
under the Articles of Association provides extra flexibility in the case, 
for example, of an additional Board member being appointed prior to the 
retirement of an existing Director. 
 
   VCT qualifying status 
 
   As at 31 December 2020, the HMRC value of qualifying investments of our 
portfolio (which includes a 12 month disregard for disposals) was 98% 
(2019: 100%). The Board continues to monitor this and all the VCT 
qualification requirements very carefully in order to ensure that all 
requirements are met and that qualifying investments comfortably exceed 
the current minimum threshold of 80% which is required for the Company 
to continue to benefit from VCT tax status. 
 
   Albion VCTs Prospectus Top Up Offers 
 
   Your Board, in conjunction with the boards of four of the other VCTs 
managed by Albion Capital Group LLP, launched a prospectus top up offer 
of new Ordinary shares on 5 January 2021. The Board announced on 15 
February 2021 that, following strong demand, it would utilise the 
over-allotment facility, bringing the total to be raised to GBP15 
million. The Offer was fully subscribed and closed to further 
applications on 26 February 2021. 
 
   The proceeds are being used to provide support to our existing portfolio 
companies and to enable us to take advantage of new investment 
opportunities. The first allotment of the shares under the Offer was on 
26 February 2021. Details of share allotments made during and after the 
financial year end can be found in notes 15 and 19 respectively. 
 
   Share buy-backs 
 
   It remains the Board's primary objective to maintain sufficient 
resources for investment in new and existing portfolio companies and for 
the continued payment of dividends to shareholders. The Board's policy 
is to buy back shares in the market, subject to the overall constraint 
that such purchases are in the Company's interest. 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. The Board continues to review the use of buy-backs and is 
satisfied that it is an important means of providing market liquidity 
for shareholders. 
 
   Annual General Meeting 
 
   The Board has been considering the current rules around the Covid-19 
pandemic on the arrangements for our forthcoming AGM. These arrangements 
may be subject to change, and we will keep shareholders up to date on 
our Manager's website at www.albion.capital/vct-hub/agms-events. 
 
   We are required by law to hold an AGM within six months of our financial 
year end. Whilst the roadmap announced by the government gives a target 
of no earlier than 21 June 2021 as the date all legal limits on mixing 
will be lifted, the Board has decided not to delay the AGM, as the 
roadmap is clear that data rather than dates are the true driver of 
restrictions. Were we to schedule a conventional AGM in the last few 
days of June and restrictions on mixing not be lifted as we all hope, we 
might face a scramble at very short notice to inform shareholders of 
Covid complying arrangements. The Board consider last years' AGM to have 
been satisfactorily live streamed, and therefore we will plan for 
something similar at an AGM to be held at noon on 10 June 2021, at the 
Company's registered office, 1 Benjamin Street, London, EC1M 5QL. 
 
   The quorum for the meeting is two, therefore two shareholders who are 
also Directors will attend in person to allow the continuation of this 
AGM. There will also be a representative of Albion Capital Group LLP as 
Company Secretary. As Covid-19 restrictions will still be in place at 
the time of the AGM, no other shareholders will be allowed entry into 
the building where the AGM is held. Our Articles of Association do not 
currently allow hybrid or wholly virtual AGMs, but as outlined below a 
resolution is being proposed to allow this in the future. 
 
   The AGM will include a presentation from the Manager, formal business 
and the answering of questions from shareholders. We will do all we can 
to improve on the shareholder engagement that we attempted last year. 
Registration details for the live stream will be available at 
www.albion.capital/funds/KAY prior to the Meeting. 
 
   We always welcome questions from our shareholders at the AGM, and, while 
we will make every attempt to allow the real time submission and 
answering of questions this cannot yet be guaranteed, so we request that 
shareholders submit questions to the Board in advance of the AGM. 
Shareholders can submit questions up until noon on 8 June 2021 by email 
to: KAYchair@albion.capital 
https://www.globenewswire.com/Tracker?data=2wLsk7wrPlY3p4UPXhvsZlURm2nNZdflKs8y8goVF0-vZuOfKaQjf355KYJT4YSp0wUAI9Seky9OuCRuFQ400IDL49b09tn2pUMDJ9HGXLk= 
. If we are able to offer additional interactive questions and answers 
details will be posted on www.albion.capital/funds/KAY prior to the 
Meeting along with the registration details. Following the Meeting, a 
summary of responses will be published at www.albion.capital/funds/KAY. 
 
 
   Shareholders' views are important, and the Board encourages shareholders 
to vote on the resolutions using the proxy form enclosed with this 
Annual Report and Financial Statements, or electronically at 
www.investorcentre.co.uk/eproxy. The Board has carefully considered the 
business to be approved at the AGM and recommends shareholders to vote 
in favour of all the resolutions being proposed. 
 
   Full details of the business to be conducted at the AGM are given in the 
Notice of the Meeting on pages 71 to 73 and in the Directors' report on 
pages 35 and 36 of the full Annual Report and Financial Statements. 
 
   Virtual and hybrid Annual General Meetings 
 
   As noted above, the Company's Articles of Association do not currently 
allow for hybrid or virtual meetings. The Covid-19 pandemic, and the 
resulting social distancing rules, have brought to the Board's attention 
the importance of the ability to continue to interact with shareholders 
during unprecedented times and, more generally, of improving 
communication with those shareholders who find it difficult to attend a 
physical meeting. A resolution will be proposed at the upcoming AGM to 
update the Articles of Association to allow the Company to have the 
flexibility to hold hybrid or virtual meetings in the future, if 
required. 
 
   Risks and uncertainties 
 
   2020 brought in a period of economic and social uncertainty rarely 
experienced in living memory. There may still also be further potential 
implications of the UK's departure from the European Union which may 
adversely affect our underlying portfolio companies. The Manager is 
continually assessing the exposure to such risks for each portfolio 
company, and where possible appropriate mitigating actions are being 
taken. 
 
   The Manager has a clear focus to allocate resources to those sectors and 
opportunities where it believes growth can be both resilient and 
sustainable, with provision of cash to assist some portfolio companies 
in these extreme market conditions being a priority. 
 
   A detailed analysis of the other risks and uncertainties facing the 
business is shown in the Strategic report below. 
 
   Outlook and prospects 
 
   Your Board has been pleased with the strength our Company has 
demonstrated during the events of the past fifteen months. No one can 
tell what other surprises the future will deal us but we continue to 
believe that investing in a diversified portfolio of fast growing young 
companies with new ideas and a bias towards technology is an attractive 
strategy and we remain confident of its long term prospects. 
 
   Robin Field 
 
   Chairman 
 
   26 March 2021 
 
   Strategic report 
 
   Investment policy 
 
   Kings Arms Yard VCT PLC is a Venture Capital Trust and the investment 
policy is intended to produce a regular and predictable dividend stream 
with an appreciation in capital value. 
 
   The Company will invest in a broad portfolio of higher growth businesses 
across a variety of sectors of the UK economy including higher risk 
technology companies. Allocation of assets will be determined by the 
investment opportunities which become available but efforts will be made 
to ensure that the portfolio is diversified both in terms of sector and 
stage of maturity of company. 
 
   The full investment policy can be found above. 
 
   Review of business and future changes 
 
   As outlined below, the Company has recorded a capital uplift during the 
year as a result of realised and unrealised gains of GBP3.3 million. Key 
individual investment movements included a GBP2.4m uplift in Proveca 
Limited, a GBP1.7m uplift in OmPrompt Holdings Limited, and a GBP1.6m 
uplift in Quantexa Limited. This was partially offset by a reduction in 
the valuation of Perpetuum Limited of GBP1.8m and a further write down 
in the valuation of Elateral Group Limited of GBP1.2m. 
 
   Details of significant events which have occurred since the end of the 
financial year are listed in note 18. Details of transactions with the 
Manager are shown in note 4. 
 
   Results and dividends 
 
 
 
 
                                                           GBP'000 
Net capital return for the year ended 31 December 
 2020                                                        2,201 
Net revenue return for the year ended 31 December 
 2020                                                        1,183 
Total return for the year ended 31 December 2020             3,384 
Dividend of 0.60 pence per share paid on 30 April 
 2020                                                      (2,256) 
Dividend of 0.51 pence per share paid on 30 October 
 2020                                                      (1,910) 
Unclaimed dividends returned to the Company                     16 
Transferred from reserves                                    (766) 
                                                           ------- 
 
Net assets as at 31 December 2020                           81,709 
                                                           ======= 
 
Net asset value per share as at 31 December 2020 (pence)    21.84p 
---------------------------------------------------------  ------- 
 
 
   The Company paid dividends of 1.11 pence per share during the year ended 
31 December 2020 (2019: 1.20 pence per share). As described in the 
Chairman's statement, the Board has moved to a variable dividend policy 
which targets an annual dividend yield of around 5% on the prevailing 
net asset value. As a result the Board has declared a first dividend of 
0.60 pence per share (2020: 0.60 pence per share) for the year ending 31 
December 2021, which will be paid on 30 April 2021 to shareholders on 
the register on 16 April 2021. 
 
   As shown in the Income statement, investment income has decreased to 
GBP1,922,000 (2019: GBP2,144,000) due to loan stock income decreasing to 
GBP1,678,000 (2019: GBP1,855,000). The capital gain of GBP2,201,000 for 
the year (2019: loss of GBP90,000) was primarily due to the uplifts in 
the valuations of Proveca, OmPrompt Holdings, and Quantexa, offset by 
the portion of the management fee charged to capital and the decrease in 
valuation of Perpetuum and Elateral Group. 
 
   The total return for the year was GBP3,384,000 (2019: GBP1,359,000), 
equating to a return of 0.91 pence per share (2019: 0.42 pence per 
share). 
 
   The Balance sheet shows that the net asset value has decreased over the 
last year to 21.84 pence per share (2019: 22.02 pence per share). 
 
   There has been a net cash inflow of GBP1,399,000 for the year (2019: 
GBP2,382,000), mainly resulting from the issue of Ordinary shares under 
the Albion VCTs Top Up Offers 2019/20. Cash inflow from fundraising has 
been utilised by investments into new and existing portfolio companies, 
dividends paid, operating activities and the buy-back of shares. 
 
   Cash and cash equivalents at the year-end increased to GBP11.3 million 
(2019: GBP9.9 million), representing 14% of net asset value. 
 
   Current portfolio sector allocation 
 
   The pie charts at the end of this announcement show the split of the 
portfolio valuation as at 31 December 2020 by: sector; stage of 
investment; and number of employees. This is a useful way of assessing 
how the Company and its portfolio is diversified across sectors, 
portfolio companies' maturity measured by revenues and their size 
measured by the number of people employed. Details of the principal 
investments made by the Company are shown in the Portfolio of 
investments on pages 23 to 25 of the full Annual Report and Financial 
Statements. 
 
   Direction of portfolio 
 
   As at 31 December 2020 the portfolio remains well balanced in terms of 
sectors and stage of maturity, with software and other technology being 
the largest element of the portfolio. During the year, a greater focus 
has been given to growth and technology investments, which has resulted 
in a decrease of asset-based investments as a percentage of the 
portfolio. Following the sale of the Company's three care homes after 
the year end, which make up the majority of the Healthcare services 
sector, the Company will continue to invest into higher growth 
businesses in line with the Company's investment policy. 
 
   Future prospects 
 
   The Company's performance record reflects the success of the strategy 
outlined above and has enabled the Company to maintain a predictable 
stream of dividend payments to shareholders. The world is currently 
navigating a global pandemic, which will likely leave no company 
unaffected. The Company's portfolio is well balanced across sectors and 
risk classes and the Board believes that the Company has the potential 
to continue to deliver returns to shareholders.  Further details on the 
Company's outlook and prospects can be found in the Chairman's 
statement. 
 
   Key Performance Indicators ("KPIs") and Alternative Performance Measures 
("APMs") 
 
   The Directors believe that the following KPIs and APMs, which are 
typical for Venture Capital Trusts, used in their own assessment of the 
Company, will provide shareholders with sufficient information to assess 
how effectively the Company is applying its investment policy to meet 
its objectives. The Directors are satisfied that the results shown in 
the following KPIs and APMs give a good indication that the Company is 
achieving its investment objective and policy. These are: 
 
   1. Total shareholder value relative to FTSE All-Share Index total return 
 
   The graph on page 4 of the full Annual Report and Financial Statements 
shows the strong performance of the Company's total shareholder value 
against the FTSE All-Share Index total return, with dividends reinvested, 
from the appointment of Albion Capital Group LLP on 1 January 2011. 
 
   The Directors consider the FTSE All-Share Index to be the most 
appropriate indicative benchmark for the Company as it contains a large 
range of sectors within the UK economy similar to a generalist VCT. 
Investors should, however, be reminded that shares in VCTs generally 
trade at a discount to their net asset values. 
 
   2. Net asset value per share and total shareholder value 
 
   Total shareholder value since inception increased by 0.93 pence per 
share (4.2% on opening NAV) to 90.68 pence per share for the year ended 
31 December 2020. 
 
   3. Movement in shareholder value in the year 
 
 
 
 
2011  2012   2013    2014   2015  2016   2017  2018   2019  2020 
----  -----  -----  ------  ----  -----  ----  -----  ----  ---- 
4.6%  19.2%  13.5%  (0.7%)  9.3%  11.4%  5.6%  11.0%  1.9%  4.2% 
----  -----  -----  ------  ----  -----  ----  -----  ----  ---- 
 
 
   Calculated as the movement in total shareholder value for the year 
divided by the opening net asset value. 
 
   Source: Albion Capital Group LLP 
 
   4. Dividend distributions 
 
   Dividends paid in respect of the year ended 31 December 2020 were 1.11 
pence per share (2019: 1.20 pence per share). 
 
   As noted in the Half-yearly Financial Report to 30 June 2020, the Board 
considered it more appropriate to move to a new variable dividend policy 
targeting an annual dividend yield of around 5%. Semi-annual dividends 
are now paid calculated as 2.5% of the most recently announced net asset 
value when the dividend is declared. This annual dividend target for the 
2021 financial year will remain in line with this new policy. The 
cumulative dividend paid since inception is 68.84 pence per share. 
 
   5. Ongoing charges 
 
   The ongoing charges ratio for the year to 31 December 2020 was 2.4% 
(2019: 2.4%). The ongoing charges ratio has been calculated using The 
Association of Investment Companies ("AIC") recommended methodology. 
This figure shows shareholders the total recurring annual running 
expenses (including investment management fees charged to capital 
reserve) as a percentage of the average net assets attributable to 
shareholders. The Directors expect the ongoing charges ratio for the 
year ahead to be approximately 2.4%. 
 
   6. VCT regulation* 
 
   The investment policy is designed to ensure that the Company continues 
to qualify and is approved as a VCT by HMRC. In order to maintain its 
status under Venture Capital Trust legislation, a VCT must comply on a 
continuing basis with the provisions of Section 274 of the Income Tax 
Act 2007, details of which are provided in the Directors' report on 
pages 33 and 34 of the full Annual Report and Financial Statements. 
 
   The relevant tests to measure compliance have been carried out and 
independently reviewed for the year ended 31 December 2020. These showed 
that the Company has complied with all tests and continues to do so. 
 
   *VCT compliance is not a numerical measure of performance and thus 
cannot be defined as an APM. 
 
   Investment progress 
 
   During the year, GBP4.0 million of cash was invested in new and existing 
portfolio companies, predominantly in the healthcare and technology 
sectors. New investments were made in 6 companies and totalled GBP1.6 
million during the year and included: 
 
 
   -- Seldon Technologies (GBP418,000), a software company that enables 
      enterprises to deploy Machine Learning models in production; 
 
   -- The Voucher Market (T/A WeGift) (GBP361,000), a cloud platform that 
      enables corporates to purchase digital gift cards and to distribute them 
      to employees and customers; 
 
   -- Concirrus (GBP308,000), a software provider bringing real-time 
      behavioural data analytics to the marine and transport insurance 
      industries; 
 
   -- Credit Kudos (GBP185,000), a challenger credit bureau helping lenders 
      optimise and automate their affordability and risk assessments; 
 
   -- TransFICC (GBP156,000), a provider of a connectivity solution, connecting 
      financial institutions with trading venues via a single API; and 
 
   -- uMedeor (T/A uMed) (GBP152,000), a middleware technology platform that 
      enables life science organisations to conduct medical research 
      programmes. 
 
 
 
   Follow-on investments were made in 12 portfolio companies and totalled 
GBP2.4 million during the year. The three largest being: GBP891,000 into 
Quantexa, following an externally led fundraising round to support the 
growth of its analytics platform which helps detect and protect against 
financial crime; GBP274,000 into Phrasee, a provider of an AI platform 
that generates optimised marketing campaigns; and GBP236,000 into Black 
Swan Data, a company that provides predictive analytics for consumer 
brands. 
 
   During the year the Company sold its entire holding in G. Network 
Communications, although terms of the sale will see proceeds being 
received in three years' time. In the current year, this still reflects 
a substantial GBP0.9 million of realised gains, with the proceeds having 
been appropriately discounted. The Company also sold its holding in 
Clear Review generating proceeds of GBP0.4 million and a realised gain 
on cost of GBP0.2 million. Other realisations can be found in the 
realisations table on page 25 of the full Annual Report and Financial 
Statements. 
 
   The pie chart at the end of this announcement outlines the different 
sectors in which the Company's assets, at carrying value, are currently 
invested. 
 
   Operational arrangements 
 
   The Company has delegated the investment management of the portfolio to 
Albion Capital Group LLP, which is authorised and regulated by the 
Financial Conduct Authority. Albion Capital Group LLP also provides 
company secretarial and other accounting and administrative support to 
the Company. 
 
   Management agreement 
 
   Under the Investment Management Agreement, Albion Capital Group LLP 
provides investment management, company secretarial and administrative 
services to the Company. Albion Capital Group LLP is entitled to an 
annual management fee of 2% of net asset value of the Company, payable 
quarterly in arrears, along with an annual administration fee of 
GBP50,000. 
 
   The aggregate payable for management and administration (normal running 
costs) are subject to an aggregate annual cap of 3% of the year end 
closing net asset value, for accounting periods commencing after 31 
December 2011. 
 
   The Investment Management Agreement can be terminated by either party on 
12 months' notice and is subject to earlier termination in the event of 
certain breaches or on the insolvency of either party. 
 
   The Manager is also entitled to an arrangement fee on investment, 
payable by each portfolio company, of approximately 2% of each 
investment made and monitoring fees where the Manager has a 
representative on the portfolio company's board. Further details of the 
Manager's fee can be found in note 4. 
 
   Performance incentive fee 
 
   As an incentive to maximise the return to investors, the Manager is 
entitled to charge an incentive fee in the event that the returns exceed 
minimum target levels. 
 
   The performance hurdle is equal to the greater of the Starting NAV of 20 
pence per share, increased by the increase in RPI plus 2% per annum from 
the Start Date of 1 January 2014 (calculated on a simple and not 
compound basis) and the highest Total Return for any earlier period 
after the Start Date (the 'high watermark'). An annual fee (in respect 
of each share in issue) of an amount equal to 15% of any excess of the 
Total Return (this being NAV per share plus dividends paid after the 
Start Date) as at the end of the relevant accounting period over the 
performance hurdle will be due to the Manager. 
 
   There was no management performance incentive payable during the year 
(2019: GBPnil). As at 31 December 2020, the total return of the Company 
since 1 January 2014 (the performance incentive fee start date) was 
29.35 pence per share, compared to a performance hurdle rate of 29.46 
pence per share, resulting in a shortfall of 0.11 pence per share. This 
amount needs to be made up in future accounting periods before any 
incentive fee becomes payable. 
 
   Evaluation of the Manager 
 
   The Board has evaluated the performance of the Manager based on the 
returns generated by the Company from the management and sale of 
existing investments, the continuing achievement of the 80% (70% pre 1 
January 2020) qualifying investment holdings requirement for the Venture 
Capital Trust status, the making of new investments in accordance with 
the investment policy, the long term prospects of current portfolio 
investments, a review of the Investment Management Agreement and the 
services provided therein and benchmarking the performance of the 
Manager to other service providers. 
 
   The Board believes that it is in the interests of shareholders as a 
whole, and of the Company, to continue the appointment of the Manager 
for the forthcoming year. 
 
   Alternative Investment Fund Managers Directive ("AIFMD") 
 
   The Board appointed Albion Capital Group LLP as the Company's AIFM in 
2014 as required by the AIFMD. The Manager is a full-scope Alternative 
Investment Fund Manager under the AIFMD. Ocorian Depositary (UK) Limited 
is the appointed Depositary and oversees the custody and cash 
arrangements and provides other AIFMD duties with respect to the 
Company. 
 
   Companies Act 2006 Section 172 Reporting 
 
   Under Section 172 of the Companies Act 2006, the Board has a duty to 
promote the success of the Company for the benefit of its members as a 
whole, having regard to the interests of other stakeholders in the 
Company, such as suppliers, and to do so with an understanding of the 
impact on the community and environment and with high standards of 
business conduct, which includes acting fairly between members of the 
Company. 
 
 
 
   The Board is very conscious of these wider responsibilities in the way 
it promotes the Company's culture and ensures, as part of its regular 
oversight, that the integrity of the Company's affairs is foremost in 
the way the activities are managed and promoted. This includes regular 
engagement with the wider stakeholders of the Company and being alert to 
issues that might damage the Company's standing in the way that it 
operates. The Board works very closely with the Manager in reviewing how 
stakeholder issues are handled, ensuring good governance and 
responsibility in managing the Company's affairs, as well as visibility 
and openness in how the affairs are conducted. 
 
   The Board considers its significant stakeholder groups to be: its 
Shareholders; suppliers, including direct agents of the Company such as 
the Manager to whom most executive functions are delegated; the 
community and the environment in the way that investments are made and 
managed. The Board also considers the portfolio companies to be 
stakeholders in the long-term success of the Company. By the nature of 
venture capital investment, the Manager is closely involved with all the 
portfolio companies. 
 
   The Company's Shareholders are key to the success of the Company. The 
Board seeks to create value for Shareholders by generating strong and 
sustainable returns to provide Shareholders with a strong, predictable 
dividend flow and the prospect of capital growth. During the year, the 
Board has approved a new dividend policy, further details of which can 
be found in the Chairman's statement. The new variable policy has the 
advantage of avoiding unsustainably high dividends if the net asset 
value falls, whilst rewarding shareholder more immediately if the net 
asset value rises. 
 
   The Board temporarily suspended buy-backs on 18 March 2020 due to the 
increasing uncertainty of the net asset value at the time. Buy-backs 
were resumed from 22 April 2020 after the announcement of the Interim 
Management Statement which included the net asset value for 31 March 
2020. The buyback policy is an important means of providing market 
liquidity for Shareholders and the Company bought back GBP1.1 million of 
shares during the year. 
 
 
 
   Shareholders' views are important and the Board encourages shareholders 
to vote on the resolutions at the Annual General Meeting. The Company's 
Annual General Meeting is used typically as an opportunity to 
communicate with investors, including through a presentation made by the 
investment management team. However, due to the impact of the 
coronavirus (Covid-19) pandemic, special circumstances are required 
again for this year's Annual General Meeting and further details are in 
the Chairman's statement. 
 
   The Company is an externally managed investment company with no 
employees and as such has nothing to report in relation to employee 
engagement but does keep close attention to how the Board operates as a 
cohesive and competent unit. The Company also has no customers in the 
traditional sense and therefore there is nothing to report in relation 
to relationships with customers. 
 
   The Company's suppliers are fundamental to the operations of the Company, 
particularly Albion Capital Group LLP as the Manager, given that 
day-to-day management responsibilities are sub-contracted to the 
Manager. The Board takes close account of how the Manager operates, with 
very close contact during the year and not just at scheduled Board 
meetings. Details of the Manager's and Board's responsibilities can be 
found in the Statement of corporate governance on pages 38 and 39 of the 
full Annual Report and Financial Statements. 
 
   The contractual arrangements with all the principal suppliers to the 
Company are reviewed regularly and formally once a year, alongside the 
performance of the suppliers in acquitting their responsibilities. The 
performance of the Manager in managing the portfolio and in providing 
company secretarial, administration and accounting services is reviewed 
in detail each year, which includes reviewing comparator engagement 
terms and portfolio performance. Further details on the evaluation of 
the Manager, and the decision to continue the appointment of the Manager 
for the forthcoming year, can be found in this report above. 
 
 
 
   The portfolio companies are considered key stakeholders, not least 
because they are principal drivers of value for the Company. As 
discussed in the Environmental, Social and Governance ("ESG") section 
below, the portfolio companies' impact on their stakeholders is also 
important to the Company. In most cases, an Albion executive has a place 
on the board of a portfolio company, in order to help with both business 
operation decisions, as well as good ESG practice. 
 
   The Board receives reports on ESG factors within its portfolio from the 
Manager as it is a signatory of the UN Principles for Responsible 
Investment ("UN PRI").  Further details of this are set out below.  ESG, 
without its specific definition, has always been at the heart of the 
responsible investing that the Company engages in and in how the Company 
conducts itself with all of its stakeholders. 
 
 
 
   The Board, although non-executive, is fully engaged in both oversight 
and the general strategic direction of the Company. During the year the 
Board's main strategic discussions focussed around cash management and 
deployment of cash for future investments, dividends and share buybacks, 
resulting in the decision to participate in the Albion VCTs Top Up 
Offers 2020/21. Time was also spent in ensuring the Board met Corporate 
Governance requirements which continue to evolve. During the year the 
Board held a further meeting in addition to its scheduled quarterly 
meetings to discuss the effect of the coronavirus (Covid-19) pandemic on 
the Company's portfolio. 
 
   Environmental, Social, and Governance ("ESG") 
 
   The Company's Manager, Albion Capital Group LLP, takes the concept of 
sustainable and responsible investment very seriously for existing 
investments and in reviewing new investment opportunities. In turn, the 
Board is kept appraised of ESG issues in connection with both the 
portfolio and in how Company affairs are conducted more generally as a 
regular part of Board oversight. 
 
   Albion Capital Group LLP is a signatory of the UN PRI. The UN PRI is the 
world's leading proponent of responsible investment, working to 
understand the investment implications of ESG factors and to support its 
international network of investor signatories in incorporating these 
factors into their investment and ownership decisions. 
 
   The Board and Manager have exercised conscious principles in making 
responsible investments throughout the life of the Company, not least in 
providing finance for promising companies in a variety of important 
sectors such as technology, healthcare and renewable energy. In making 
the investments, the Manager is directly involved in the oversight and 
governance of these investments, including ensuring standards of 
reporting and visibility on business practices, all of which are 
reported to the Board of the Company. By its nature, not least in making 
qualifying investments which fulfil the criteria set by HMRC, the 
Company has focused on sustainable and longer-term investment 
propositions, some of which will fail (in the nature of all small 
companies), but some of which will grow and serve important societal 
demands. One of the most important drivers of performance is the quality 
of the investment portfolio, which goes beyond the individual valuations 
and examines the prospects of each of the portfolio companies, as well 
as the sectors in which they operate -- all requiring a longer- term 
view. 
 
   In the nature of venture capital investment, Albion Capital Group LLP is 
more intimately involved in the affairs of portfolio companies than 
might be the case for funds invested in listed securities. As such, 
Albion Capital Group LLP is in a position to influence good governance 
and behaviour in the portfolio companies, many of which are relatively 
small companies without the support of a larger company's administration 
and advisory infrastructure. 
 
   The Company adheres to the principles of the AIC Code of Corporate 
Governance and is also aware of other governance and corporate conduct 
guidance which it meets as far as practical, including in the 
constitution of a diversified and independent Board capable of providing 
constructive challenge. 
 
   The Company's portfolio is currently invested in healthcare, renewable 
energy, education, software and other technology (which includes cyber 
security and data protection), with the most significant percentage of 
the Company's portfolio invested in sectors and companies which would be 
seen by many measures to be both sustainable and socially aware on the 
services they render. 
 
   Albion Capital Group LLP incorporates ESG considerations into its 
investment decisions. These form part of its process to create value for 
investors and develop sustainable long-term strategies for portfolio 
companies. Albion Capital Group LLP reports ESG criteria to UN PRI 
(annually) and to the Board quarterly. 
 
   ESG principles are integrated at the pre-investment, investment and exit 
stages. This is reflected in transparency of reporting, governance 
principles adopted by the Company and the portfolio companies, and 
increasingly in the positive environmental or socially impactful nature 
of investments made. Albion Capital Group LLP, where relevant, considers 
climate-specific issues in its investment policies and activities. 
However, as the majority of the Company's portfolio consists of small 
(2-250 Full Time Employees), private, typically software companies with 
limited environmental impact, climate change is not considered to be a 
significant risk, and actions are proportionate to that risk. 
 
   Pre-investment stage 
 
   An exclusion list is used to rule out investments in unsustainable areas, 
or in areas which might be perceived as socially detrimental. ESG due 
diligence is performed on each potential portfolio company to identify 
any sustainability risks associated with the investment. Identified 
sustainability risks are ranked from low to high and are reported to the 
relevant investment committee. The investment committee considers each 
potential investment. If sustainability risks are identified, 
mitigations are assessed and, if necessary, mitigation plans are put in 
place. If this is not deemed sufficient, the committee would consider 
the appropriate level and structure of funding to balance the associated 
risks. If this is not possible, investment committee approval will not 
be provided, and the investment will not proceed. 
 
   Investment stage 
 
   All new and existing portfolio companies are asked to report against an 
ESG Balanced Score Card annually. The ESG Balanced Score Card contains a 
number of sustainability factors against which a portfolio company will 
be assessed in order to determine the potential sustainability risks and 
opportunities arising from the investment. The score cards form part of 
the Manager's internal review meetings alongside discussions around 
other risk factors, and any outstanding issues are addressed in 
collaboration with the portfolio companies' senior management. 
 
   Exit stage 
 
   Albion Capital Group LLP aims to ensure that good ESG practices remain 
in place following exit. For example, by ensuring that the company 
creates a self-sustaining ESG management system during our period of 
ownership, wherever feasible. 
 
   Social and community issues, employees and human rights 
 
   The Board recognises the requirement under section 414C of the Companies 
Act 2006 (the "Act") to detail information about social and community 
issues, employees and human rights; including any policies it has in 
relation to these matters and effectiveness of these policies. As an 
externally managed investment company with no employees, the Company has 
no formal policies in these matters, however, it is at the core of its 
responsible investment strategy as detailed above. 
 
   General Data Protection Regulation 
 
   The General Data Protection Regulation has the objective of unifying 
data privacy requirements across the European Union, and continues to 
apply in the United Kingdom after Brexit. The Manager continues to take 
action to ensure that the Manager and the Company are compliant with the 
regulation. 
 
   Further policies 
 
   The Company has adopted a number of further policies relating to: 
 
   --              Environment 
 
   --              Global greenhouse gas emissions 
 
   --              Anti-bribery 
 
   --              Anti-facilitation of tax evasion 
 
   --              Diversity 
 
   and these are set out in the Directors' report on page 34 of the full 
Annual Report and Financial Statements. 
 
   Risk management 
 
   The Board carries out a regular review of the risk environment in which 
the Company operates, together with changes to the environment and 
individual risks. The Board also identifies emerging risks which might 
impact on the Company. In the period the most noticeable risk has been 
the global pandemic which has impacted not only public health and 
mobility but also has had an adverse impact on the economy, the full 
impact of which is likely to be uncertain for some time. 
 
 
 
   The Directors have carried out a robust assessment of the Company's 
principal risks and uncertainties, and explain how they are being 
mitigated as follows: 
 
 
 
 
Risk          Possible consequence                                             Risk management 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
Investment,   The risk of investment in poor quality businesses,               To reduce this risk, the Board places reliance upon 
performance    which could reduce the returns to shareholders, and              the skills and expertise of the Manager and its track 
and            could negatively impact on the Company's current and             record over many years of making successful investments 
valuation      future valuations.                                               in this segment of the market. In addition, the Manager 
risk           By nature, smaller unquoted businesses, such as those            operates a formal and structured investment appraisal 
               that qualify for Venture Capital Trust purposes, are             and review process, which includes an Investment Committee, 
               more volatile than larger, long established businesses.          comprising investment professionals from the Manager 
               Investments in open-ended equity funds result in exposure        for all investments, and at least one external investment 
               to market risk through movements in price per unit.              professional for investments greater than GBP1 million 
               The Company's investment valuation methodology is                in aggregate across all the Albion managed VCTs. The 
               reliant on the accuracy and completeness of information          Manager also invites and takes account of comments 
               that is issued by portfolio companies. In particular,            from non-executive Directors of the Company on matters 
               the Directors may not be aware of or take into account           discussed at the Investment Committee meetings. Investments 
               certain events or circumstances which occur after                are actively and regularly monitored by the Manager 
               the information issued by such companies is reported.            (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. The Board and Manager 
                                                                                regularly review the deployment of investments and 
                                                                                cash resources available to the Company in assessing 
                                                                                liquidity required for servicing the Company's buy-backs, 
                                                                                dividend payments and operational expenses. 
                                                                                The unquoted investments held by the Company are designated 
                                                                                at fair value through profit or loss and valued in 
                                                                                accordance with the International Private Equity and 
                                                                                Venture Capital Valuation Guidelines as updated in 
                                                                                2018. These guidelines set out recommendations, intended 
                                                                                to represent current best practice on the valuation 
                                                                                of venture capital investments. The valuation takes 
                                                                                into account all known material facts up to the date 
                                                                                of approval of the Financial Statements by the Board. 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
VCT approval  The Company must comply with section 274 of the Income           To reduce this risk, the Board has appointed the Manager, 
risk           Tax Act 2007 which enables its investors to take advantage       which has a team with significant experience in Venture 
               of tax relief on their investment and on future returns.         Capital Trust management, and are used to operating 
               Breach of any of the rules enabling the Company to               within the requirements of the Venture Capital Trust 
               hold VCT status could result in the loss of that status.         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 portfolio company is also pre-cleared 
                                                                                with our professional advisers or H.M. Revenue & Customs. 
                                                                                The Company monitors closely the extent of qualifying 
                                                                                holdings and addresses this as required. 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
Regulatory    The Company is listed on The London Stock Exchange               Board members and the Manager have experience of operating 
and            and is required to comply with the rules of the UK               at senior levels within or advising quoted companies. 
compliance     Listing Authority, as well as with the Companies Act,            In addition, the Board and the Manager receive regular 
risk           Accounting Standards and other legislation. Failure              updates on new regulation, including legislation on 
               to comply with these regulations could result in a               the management of the Company, from its auditor, lawyers 
               delisting of the Company's shares, or other penalties            and other professional bodies. The Company is subject 
               under the Companies Act or from financial reporting              to compliance checks through the Manager's compliance 
               oversight bodies.                                                officer, and any issues arising from compliance or 
                                                                                regulation are reported to its own board on a monthly 
                                                                                basis. 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. 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
Operational   The Company relies on a number of third parties, in              The Company and its operations are subject to a series 
and internal   particular the Manager, for the provision of investment          of rigorous internal controls and review procedures 
control        management and administrative functions. Failures                exercised throughout the year, and receives reports 
risk           in key systems and controls within the Manager's business        from the Manager on its internal controls and risk 
               could place assets of the Company at risk or result              management, including on matters relating to cyber 
               in reduced or inaccurate information being passed                security. 
               to the Board or to shareholders.                                 The Audit Committee reviews the Internal Audit Reports 
                                                                                prepared by the Manager's internal auditors, PKF Littlejohn 
                                                                                LLP and has access to the internal audit partner of 
                                                                                PKF Littlejohn LLP 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. 
                                                                                From 1 October 2018, Ocorian Depositary (UK) Limited 
                                                                                was appointed as Depositary to oversee the custody 
                                                                                and cash arrangements and provide other AIFMD duties. 
                                                                                The Board reviews the quarterly reports prepared by 
                                                                                Ocorian Depositary (UK) Limited to ensure that Albion 
                                                                                Capital is adhering to its duties as a full-scope 
                                                                                Alternative Investment Fund Manager under the AIFMD. 
                                                                                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 
                                                                                policy. The Manager and other service providers have 
                                                                                also demonstrated to the Board that there is no undue 
                                                                                reliance placed upon any one individual. 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
Economic,     Changes in economic conditions, including, for example,          The Company invests in a diversified portfolio of 
political      interest rates, rates of inflation, industry conditions,         companies across a number of industry sectors and 
and social     competition, political and diplomatic events, such               in addition often invests in a mixture of instruments 
risk           as the impact of Brexit, and other factors could substantially   in portfolio companies and has a policy of minimising 
               and adversely affect the Company's prospects in a                any external bank borrowings within portfolio companies. 
               number of ways. This also includes risks of social               At any given time, the Company has sufficient cash 
               upheaval, including from infection and population                resources to meet its operating requirements, including 
               re-distribution, as well as economic risk challenges             share buy-backs and follow on investments. 
               as a result of healthcare pandemics/infection.                   In common with most commercial operations, exogenous 
               The current significant exogenous risk to the Company,           risks over which the Company has no control are always 
               the wider population and economy, is the Covid-19                a risk and the Company does what it can to address 
               pandemic.                                                        these risks where possible, not least as the nature 
                                                                                of the investments the Company makes are long term. 
                                                                                The Board and Manager are continuously assessing the 
                                                                                resilience of the portfolio, the Company and its operations 
                                                                                and the robustness of the Company's external agents 
                                                                                during the health crisis, as well as considering longer 
                                                                                term impacts on how the Company might be positioned 
                                                                                in how it invests and operates. Ensuring liquidity 
                                                                                in the portfolio to cope with exigent and unexpected 
                                                                                pressures on the finances of the portfolio and the 
                                                                                Company is an important part of the risk mitigation 
                                                                                in these uncertain times. The portfolio is structured 
                                                                                as an all-weather portfolio with c.66 companies, which 
                                                                                are diversified as discussed above. Exposure is relatively 
                                                                                small to at-risk sectors that include leisure, hospitality, 
                                                                                retail and travel. 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
Market value  The market value of Ordinary shares can fluctuate.               The Company operates a share buyback policy, which 
of Ordinary    The market value of an Ordinary share, as well as                is designed to limit the discount at which the Ordinary 
shares         being affected by its net asset value and prospective            shares trade to around 5 per cent. to net asset value, 
               net asset value, also takes into account its dividend            by providing a purchaser through the Company in absence 
               yield and prevailing interest rates. As such, the                of market purchasers. From time to time buy-backs 
               market value of an Ordinary share may vary considerably          cannot be applied, for example when the Company is 
               from its underlying net asset value. The market prices           subject to a close period, or if it were to exhaust 
               of shares in quoted investment companies can, therefore,         and could not renew any buyback authorities. 
               be at a discount or premium to the net asset value               New Ordinary shares are issued at sufficient premium 
               at different times, depending on supply and demand,              to net asset value to cover the costs of issue and 
               market conditions, general investor sentiment and                to avoid asset value dilution to existing investors. 
               other factors, including the ability to exercise share 
               buybacks. Accordingly, the market price of the Ordinary 
               shares may not fully reflect their underlying net 
               asset value. 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
Reputational  The Company relies on the judgement and reputation               The Board regularly questions the Manager on its ethics, 
risk           of the Manager which is itself subject to the risk               procedures, safeguards and investment philosophy, 
               of losses.                                                       which should consequently result in the risk to reputational 
                                                                                damage being minimised. 
------------  ---------------------------------------------------------------  ------------------------------------------------------------- 
 
 
 
   Viability statement 
 
   In accordance with the FRC UK Corporate Governance Code published in 
2018 and provision 36 of the AIC Code of Corporate Governance, the 
Directors have assessed the prospects of the Company over three years to 
31 December 2023. The Directors believe that three years is a reasonable 
period in which they can assess the ability of the Company to continue 
to operate and meet its liabilities as they fall due and is also the 
period used by the Board in the strategic planning process and is 
considered reasonable for a business of our nature and size. The three 
year period is considered the most appropriate given the forecasts that 
the Board requires from the Manager and the estimated timelines for 
finding, assessing and completing investments. The three year period 
also takes account of the potential impact of new regulations, should 
they be imposed, and how they may impact the Company over the longer 
term, and the availability of cash, but cannot take into account the 
full extent of the exogenous risks that are impacting on global 
economies at the date of these accounts. 
 
   The Directors have carried out a robust assessment of the emerging and 
principal risks facing the Company as explained above, including those 
that could threaten its business model, future performance, solvency or 
liquidity. The Board also considered the procedures in place to identify 
emerging risks and the risk management processes in place to avoid or 
reduce the impact of the underlying risks. The Board focused on the 
major factors which affect the economic, regulatory and political 
environment, including any potential impact from Brexit. The Board, 
after careful consideration, believes that Brexit will have no major 
impact on the going concern of the Company, primarily due to the markets 
our portfolio companies target, which in most cases are the UK and 
increasingly, the US, for our software and technology businesses. 
Portfolio companies targeting European markets have also shown 
resilience so far. The coronavirus (Covid-19) pandemic therefore remains 
the largest uncertainty impacting on the Company. In light of this 
continuing uncertainty, robust stress tested cashflows, process 
resilience and contingencies have been examined in trying to deal with 
the principal risks faced by the Company. 
 
   The Board assessed the ability of the Company to raise finance and 
deploy capital, as well as the existing cash resources of the Company. 
The portfolio is well balanced and geared towards long term growth 
delivering dividends and capital growth to shareholders. In assessing 
the prospects of the Company, the Directors have considered the cash 
flow by looking at the Company's income and expenditure projections and 
funding pipeline over the assessment period of three years and they 
appear realistic. 
 
   Taking into account the processes for mitigating risks, monitoring costs, 
share buy-backs and issuance, the Manager's compliance with the 
investment objective, policies and business model and the balance of the 
portfolio, the Directors have concluded that there is a reasonable 
expectation that the Company will be able to continue in operation and 
meet its liabilities as they fall due over the three year period to 31 
December 2023. 
 
   This Strategic report of the Company for the year ended 31 December 2020 
has been prepared in accordance with the requirements of section 414A of 
the Companies Act 2006 (the "Act"). The purpose of this report is to 
provide Shareholders with sufficient information to enable them to 
assess the extent to which the Directors have performed their duty to 
promote the success of the Company in accordance with Section 172 of the 
Act. 
 
   For and on behalf of the Board 
 
   Robin Field 
 
   Chairman 
 
   26 March 2021 
 
   Responsibility statement 
 
   In preparing these Financial Statements for the year to 31 December 
2020, the Directors of the Company, being Robin Field, Thomas Chambers, 
Martin Fiennes and Fiona Wollocombe, confirm to the best of their 
knowledge: 
 
 
   -- summary financial information contained in this announcement and the full 
      Annual Report and Financial Statements for the year ended 31 December 
      2020 for the Company has been prepared in accordance with United Kingdom 
      Generally Accepted Accounting Practice (UK Accounting Standards and 
      applicable law) and give a true and fair view of the assets, liabilities, 
      financial position and profit or loss of the Company; and 
 
   -- the Chairman's statement and Strategic report include 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 it faces. 
 
 
 
   We consider that the Annual Report and Financial Statements, taken as a 
whole, are fair, balanced, and understandable and provide the 
information necessary for shareholders to asses the Company's position, 
performance, business model and strategy. 
 
   A detailed "Statement of Directors' responsibilities" is contained on 
page 37 of the full Annual Report and Financial Statements. 
 
   For and on behalf of the Board 
 
   Robin Field 
 
   Chairman 
 
   26 March 2021 
 
   Income statement 
 
 
 
 
                                                                    Year ended 31 December      Year ended 31 December 
                                                                             2020                        2019 
----------------------------------------------------------  ----  --------------------------  -------------------------- 
                                                                  Revenue  Capital   Total    Revenue  Capital   Total 
                                                            Note  GBP'000  GBP'000  GBP'000   GBP'000  GBP'000  GBP'000 
----------------------------------------------------------  ----  -------  -------  --------  -------  -------  -------- 
Gains on investments                                         2          -    3,333     3,333        -    1,002     1,002 
Investment income                                            3      1,922        -     1,922    2,144        -     2,144 
Investment management fee                                    4      (377)  (1,132)   (1,509)    (364)  (1,092)   (1,456) 
Other expenses                                               5      (362)        -     (362)    (331)        -     (331) 
Profit/(loss) on ordinary activities before tax                     1,183    2,201     3,384    1,449     (90)     1,359 
Tax on ordinary activities                                     7        -        -         -        -        -         - 
                                                                  -------  -------  --------  -------  -------  -------- 
Profit/(loss) and total comprehensive income attributable 
 to shareholders                                                    1,183    2,201     3,384    1,449     (90)     1,359 
                                                                  -------  -------  --------  -------  -------  -------- 
Basic and diluted return/(loss) per share (pence)*             9     0.32     0.59      0.91     0.44   (0.02)      0.42 
                                                                  -------  -------  --------  -------  -------  -------- 
 
 
 
   *adjusted for treasury shares 
 
   The accompanying notes form an integral part of these Financial 
Statements. 
 
   The total column of this 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. 
 
   Balance sheet 
 
 
 
 
                                            31 December 2020  31 December 2019 
                                      Note      GBP'000           GBP'000 
------------------------------------  ----  ----------------  ---------------- 
 
 
Fixed assets investments                10            69,652            63,960 
 
Current assets 
Trade and other receivables             12             1,293               115 
Cash and cash equivalents                             11,266             9,867 
                                            ----------------  ---------------- 
                                                      12,559             9,982 
 
Total assets                                          82,211            73,942 
 
Payables: amounts falling due within 
one year 
Trade and other payables                13             (502)             (486) 
                                            ----------------  ---------------- 
 
 
Total assets less current 
 liabilities                                          81,709            73,456 
                                            ----------------  ---------------- 
 
Equity attributable to equityholders 
Called-up share capital                 14             4,346             3,883 
Share premium                                         45,481            35,825 
Capital redemption reserve                                11                11 
Unrealised capital reserve                            16,786            14,707 
Realised capital reserve                               9,322             9,200 
Other distributable reserve                            5,763             9,830 
                                            ----------------  ---------------- 
 
Total equity shareholders' funds                      81,709            73,456 
                                            ----------------  ---------------- 
 
Basic and diluted net asset value 
 per share (pence)*                     15             21.84             22.02 
                                            ----------------  ---------------- 
 
 
 
   *excluding treasury shares 
 
   The accompanying notes form an integral part of these Financial 
Statements. 
 
   The Financial Statements were approved by the Board of Directors and 
authorised for issue on 26 March 2021 and were signed on its behalf by: 
 
   Robin Field 
 
   Chairman 
 
   Company number: 03139019 
 
   Statement of changes in equity 
 
 
 
 
                                                       Called-up                                         Unrealised  Realised      Other 
                                                         share     Share                                  capital    capital   distributable 
                                                        capital   premium    Capital redemption reserve   reserve    reserve*    reserve*      Total 
                                                        GBP'000   GBP'000            GBP'000              GBP'000    GBP'000      GBP'000     GBP'000 
-----------------------------------------------------  ---------  -------  ----------------------------  ----------  --------  -------------  ------- 
At 1 January 2020                                          3,883   35,825                            11      14,707     9,200          9,830   73,456 
Profit/(loss) and total comprehensive income for the 
 period                                                        -        -                             -       3,013     (812)          1,183    3,384 
Transfer of previously unrealised gains on disposal 
 of investments                                                -        -                             -       (934)       934              -        - 
Purchase of own shares for treasury                            -        -                             -           -         -        (1,100)  (1,100) 
Issue of equity                                              462    9,892                             -           -         -              -   10,354 
Cost of issue of equity                                        -    (236)                             -           -         -              -    (236) 
Dividends paid                                                 -        -                             -           -         -        (4,150)  (4,150) 
                                                       ---------  -------  ----------------------------  ----------  --------  -------------  ------- 
At 31 December 2020                                        4,346   45,481                            11      16,786     9,322          5,763   81,709 
                                                       ---------  -------  ----------------------------  ----------  --------  -------------  ------- 
At 1 January 2019                                          3,519   27,896                            11      15,358     8,639         13,727   69,150 
Profit/(loss) and total comprehensive income for the 
 period                                                        -        -                             -         274     (364)          1,449    1,359 
Transfer of previously unrealised gains on disposal 
 of investments                                                -        -                             -       (925)       925              -        - 
Purchase of own shares for treasury                            -        -                             -           -         -        (1,367)  (1,367) 
Issue of equity                                              364    8,120                             -           -         -              -    8,484 
Cost of issue of equity                                        -    (191)                             -           -         -              -    (191) 
Dividends paid                                                 -        -                             -           -         -        (3,979)  (3,979) 
                                                       ---------  -------  ----------------------------  ----------  --------  -------------  ------- 
At 31 December 2019                                        3,883   35,825                            11      14,707     9,200          9,830   73,456 
-----------------------------------------------------  ---------  -------  ----------------------------  ----------  --------  -------------  ------- 
 
 
   *These reserves amount to GBP15,085,000 (2019: GBP19,030,000) which is 
considered distributable. 
 
   The accompanying notes form an integral part of these Financial 
Statements. 
 
   Statement of cash flows 
 
 
 
 
                                          Year ended          Year ended 
                                       31 December 2020     31 December 2019 
                                           GBP'000              GBP'000 
----------------------------------   --------------------  ----------------- 
 
Cash flow from operating 
activities 
Investment income received                          1,467              2,000 
Deposit interest received                              25                 35 
Dividend income received                              220                254 
Investment management fee paid                    (1,499)            (1,425) 
Performance incentive fee paid**                        -              (637) 
Other cash payments                                 (359)              (309) 
UK corporation tax paid                                 -                  - 
                                     --------------------  ----------------- 
 
Net cash flow from operating 
 activities                                         (146)               (82) 
 
Cash flow from investing 
activities 
Purchase of fixed asset investments               (3,990)            (5,637) 
Disposal of fixed asset investments                   639              5,172 
 
Net cash flow from investing 
 activities                                       (3,351)              (465) 
                                     --------------------  ----------------- 
 
Cash flow from financing 
activities 
 
Issue of share capital                              9,588              7,804 
Cost of issue of equity                               (4)                (4) 
Purchase of own shares (including 
 costs)                                           (1,100)            (1,367) 
Equity dividends paid*                            (3,588)            (3,504) 
 
 
Net cash flow from financing 
 activities                                         4,896              2,929 
                                     --------------------  ----------------- 
 
Increase in cash and cash 
 equivalents                                        1,399              2,382 
 
Cash and cash equivalents at start 
 of the year                                        9,867              7,485 
 
 
Cash and cash equivalents at end of 
 the year                                          11,266              9,867 
-----------------------------------  --------------------  ----------------- 
 
   * The equity dividends paid shown in the cash flow are different to the 
dividends disclosed in note 8 as a result of the non-cash effect of the 
Dividend Reinvestment Scheme. 
 
   ** The performance incentive fee for the year ended 31 December 2018 was 
paid in the year ended 31 December 2019. 
 
   The accompanying notes form an integral part of these Financial 
Statements. 
 
   Notes to the Financial Statements 
 
   1. Accounting policies 
 
   Basis of accounting 
 
   The Financial Statements have been prepared in accordance with 
applicable United Kingdom law and accounting standards, including 
Financial Reporting Standard 102 ("FRS 102"), and with the Statement of 
Recommended Practice "Financial Statements of Investment Trust Companies 
and Venture Capital Trusts" ("SORP") issued by The Association of 
Investment Companies ("AIC"). The Financial Statements have been 
prepared on a going concern basis and further details can be found in 
the Directors' report on pages 32 and 33 of the full Annual Report and 
Financial Statements. 
 
   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") in accordance with FRS 102 sections 11 and 12. The Company 
values investments by following the International Private Equity and 
Venture Capital Valuation ("IPEV") Guidelines as updated in 2018 and 
further detail on the valuation techniques used are outlined below. 
 
   Company information can be found on page 2 of the full Annual Report and 
Financial Statements. 
 
   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% 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, 
including loan stock, are designated 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 IPEV 
      Guidelines. Indicators of fair value are derived using established 
      methodologies including earnings multiples, revenue multiples, the level 
      of third party offers received, cost or price of recent investment rounds, 
      net assets and industry valuation benchmarks. Where price of recent 
      investment is used as a starting point for estimating fair value at 
      subsequent measurement dates, this has been benchmarked using an 
      appropriate valuation technique permitted by the IPEV guidelines. 
 
   -- In situations where cost or price of recent investment is used, 
      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 Income statement when a share becomes ex-dividend. 
 
   Current assets and payables 
 
   Receivables (including debtors due after more than one year), payables 
and cash are carried at amortised cost, in accordance with FRS 102. 
Debtors due after more than one year meet the definition of a financing 
transaction held at amortised cost, and interest will be recognised 
through capital over the credit period using the effective interest 
method. 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 income 
 
   Fixed returns on non-equity shares and debt securities are recognised 
when the Company's right to receive payment and expect 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 fee, performance incentive fee 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% of management fees and performance incentive fees, if any, are 
      allocated to the realised capital reserve. This is in line with the 
      Board's expectation that over the long term 75% 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. 
 
   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 
 
   Called-up share capital 
 
   This reserve accounts for the nominal value of the shares. 
 
   Share premium 
 
   This reserve accounts for the difference between the price paid for the 
Company's shares and the nominal value of those shares, 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 diminution 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 2012 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 buy-back 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 smaller companies 
principally based in the UK. 
 
 
 
 
                                             Year ended         Year ended 
                                           31 December 2020   31 December 2019 
2. Gains on investments                        GBP'000            GBP'000 
----------------------------------------  -----------------  ----------------- 
Unrealised gains on fixed asset 
 investments                                          3,013                647 
Unrealised losses on current asset 
 investments                                              -              (373) 
Realised gains on fixed asset 
 investments                                            320                728 
                                                      3,333              1,002 
                                          -----------------  ----------------- 
 
 
 
 
 
 
                          Year ended         Year ended 
                        31 December 2020   31 December 2019 
3. Investment income        GBP'000            GBP'000 
---------------------  -----------------  ----------------- 
Loan stock interest                1,678              1,855 
Dividends                            220                254 
Bank interest                         24                 35 
                                   1,922              2,144 
                       -----------------  ----------------- 
 
 
 
 
 
 
                                             Year ended         Year ended 
                                           31 December 2020   31 December 2019 
4. Investment management fee                   GBP'000            GBP'000 
----------------------------------------  -----------------  ----------------- 
Investment management fee charged to 
 revenue                                                377                364 
Investment management fee charged to 
 capital                                              1,132              1,092 
                                                      1,509              1,456 
                                          -----------------  ----------------- 
 
 
   Further details of the Management agreement under which the investment 
management fee and performance incentive fee are paid is given in the 
Strategic report. 
 
   During the year, services with a value of GBP1,509,000 (2019: 
GBP1,456,000) and GBP50,000 (2019: GBP50,000) were purchased by the 
Company from Albion Capital Group LLP in respect of management and 
administration fees respectively. There was no performance incentive fee 
due during the year (2019: GBPnil). At the financial year end, the 
amount due to Albion Capital Group LLP in respect of these services 
disclosed within payables was GBP400,000 (2019: GBP391,000). 
 
   Albion Capital Group LLP is, from time-to-time, eligible to receive 
arrangement fees and monitoring fees from portfolio companies. During 
the year ended 31 December 2020, fees of GBP183,000 (31 December 2019: 
GBP200,000) attributable to the investments of the Company were paid 
pursuant to these arrangements. 
 
   Albion Capital Group LLP, its partners and staff hold 1,429,708 Ordinary 
shares in the Company as at 31 December 2020. 
 
   The Company has entered into an offer agreement relating to the Offers 
with the Company's investment manager Albion Capital Group LLP, pursuant 
to which Albion Capital will receive a fee of 2.5% of the gross proceeds 
of the Offers and out of which Albion Capital will pay the costs of the 
Offers, as detailed in the Prospectus. 
 
 
 
 
                                                         Year ended         Year ended 
                                                       31 December 2020   31 December 2019 
5. Other expenses                                          GBP'000            GBP'000 
----------------------------------------------------  -----------------  ----------------- 
Directors' fees (inc. NIC)                                           99                 91 
Auditor's remuneration for statutory audit services 
 (excluding VAT)                                                     31                 29 
Secretarial and administration fee                                   50                 50 
 Other administrative expenses                                      182                161 
                                                                    362                331 
                                                      -----------------  ----------------- 
 
 
 
 
 
 
                             Year ended     Year ended 
                       31 December 2020   31 December 2019 
6. Directors' fees              GBP'000       GBP'000 
-------------------  ------------------  ----------------- 
Directors' fees                      91                 84 
National insurance                    8                  7 
                                     99                 91 
                      -----------------  ----------------- 
 
 
   The Company's key management personnel are the Directors. Further 
information regarding Directors' remuneration can be found in the 
Directors' remuneration report on pages 43 to 45 of the full Annual 
Report and Financial Statements. 
 
 
 
 
                                                           Year ended          Year ended 
                                                        31 December 2020    31 December 2019 
7. Tax on ordinary activities                                GBP'000             GBP'000 
-----------------------------------------------------  ------------------  ------------------ 
UK Corporation tax payable                                     -                   - 
                                                       ------------------  ------------------ 
 
                                                            Year ended          Year ended 
  Reconciliation of profit on ordinary activities to     31 December 2020    31 December 2019 
  taxation charge                                            GBP'000             GBP'000 
-----------------------------------------------------  ------------------  ------------------ 
Return on ordinary activities before taxation                       3,384               1,359 
                                                       ------------------  ------------------ 
 
Tax charge on profit at the effective UK corporation 
 tax rate of 19.00% (2019: 19.00%)                                    643                 258 
Effects of: 
Non-taxable gains                                                   (633)               (190) 
Non-taxable income                                                   (42)                (48) 
Unutilised management expenses/(Prior year excess 
 management expenses utilised)                                         32                (20) 
                                                       ------------------  ------------------ 
                                                                        -                   - 
                                                       ------------------  ------------------ 
 
 
   The tax charge for the year shown in the Income statement is lower than 
the effective rate of corporation tax in the UK of 19.00% (2019: 
19.00%). The differences are explained above. 
 
   The Company has excess management expenses of GBP11,601,000 (2019: 
GBP11,431,000) that are available for offset against future profits. A 
deferred tax asset of GBP2,204,000 (2019: GBP1,943,000) has not been 
recognised in respect of those losses as they will be recoverable only 
to the extent that the Company has sufficient future taxable profits. 
 
 
 
 
                                                        Year ended         Year ended 
                                                      31 December 2020   31 December 2019 
8. Dividends                                              GBP'000            GBP'000 
---------------------------------------------------  -----------------  ----------------- 
First dividend of 0.60 pence per share paid on 30 
 April 2019                                                          -              2,010 
Second dividend of 0.60 pence per share paid on 31 
 October 2019                                                        -              2,005 
First dividend of 0.60 pence per share paid on 30 
 April 2020                                                      2,256                  - 
Second dividend of 0.51 pence per share paid on 30 
 October 2020                                                    1,910                  - 
Unclaimed dividends returned to the Company                       (16)               (36) 
                                                     -----------------  ----------------- 
                                                                 4,150              3,979 
                                                     -----------------  ----------------- 
 
 
   The Directors have declared a first dividend of 0.60 pence per share for 
the year ending 31 December 2021, which will amount to approximately 
GBP2,645,000. This dividend will be paid on 30 April 2021 to 
shareholders on the register on 16 April 2021. 
 
 
 
 
9. Basic and diluted return/(loss) per share 
                                                           Year ended 31 December    Year ended 31 December 
                                                                    2020                      2019 
                                                          Revenue  Capital   Total   Revenue  Capital  Total 
--------------------------------------------------------  -------  -------  -------  -------  -------  ----- 
Return/(loss) attributable to shareholders (GBP'000)        1,183    2,201    3,384    1,449     (90)  1,359 
Weighted average shares in issue (adjusted for treasury 
 shares)                                                         372,282,416               327,246,191 
Return/(loss) attributable per equity share (pence)          0.32     0.59     0.91     0.44   (0.02)   0.42 
 
 
   The weighted average number of Ordinary shares is calculated after 
adjusting for treasury shares of 60,491,609 (2019: 54,723,000). 
 
   There are no convertible instruments, derivatives or contingent share 
agreements in issue so basic and diluted return per share are the same. 
 
 
 
 
                                                        31 December 2020  31 December 2019 
10. Fixed asset investments                                  GBP'000           GBP'000 
------------------------------------------------------  ----------------  ---------------- 
Investments held at fair value through profit or loss 
 Unquoted equity and preference shares                            51,072            44,833 
Unquoted loan stock                                               18,580            19,127 
                                                                  69,652            63,960 
                                                        ----------------  ---------------- 
 
 
 
 
 
 
                                                      31 December 2020  31 December 2019 
                                                           GBP'000           GBP'000 
----------------------------------------------------  ----------------  ---------------- 
Opening valuation                                               63,960            61,639 
Purchases at cost                                                3,991             6,136 
Disposal proceeds                                              (1,842)           (5,043) 
Realised gains                                                     320               728 
Movement in loan stock accrued income                              210             (147) 
Movement in unrealised gains                                     3,013               647 
                                                      ----------------  ---------------- 
Closing valuation                                               69,652            63,960 
                                                      ----------------  ---------------- 
Movement in loan stock accrued income 
Opening accumulated loan stock accrued income                      579               726 
Movement in loan stock accrued income                              210             (147) 
                                                      ----------------  ---------------- 
Closing accumulated loan stock accrued income                      789               579 
                                                      ----------------  ---------------- 
Movement in unrealised gains 
Opening accumulated unrealised gains                            14,695            14,973 
Transfer of previously unrealised gains to realised 
 reserve on disposal of investments                              (934)             (925) 
Movement in unrealised gains                                     3,013               647 
                                                      ----------------  ---------------- 
Closing accumulated unrealised gains                            16,774            14,695 
                                                      ----------------  ---------------- 
Historical cost basis 
Opening book cost                                               48,686            45,940 
Purchases at cost                                                3,991             6,136 
Sales at cost                                                    (588)           (3,390) 
Closing book cost                                               52,089            48,686 
                                                      ----------------  ---------------- 
 
 
   Amounts shown as cost represent the acquisition cost in the case of 
investments made by the Company and/or the valuation attributed to the 
investments acquired from other VCTs at the dates of merger, plus any 
subsequent acquisition cost. 
 
   Purchases and disposals detailed above may not agree to purchases and 
disposals in the Statement of cash flows due to restructuring of 
investments, conversion of convertible loan stock and settlement of 
receivables and payables. 
 
   The Company does not hold any assets as the result of the enforcement of 
security during the period, and believes that the carrying values for 
both impaired and past due assets are covered by the value of security 
held for these loan stock investments. 
 
   Unquoted investments are valued in accordance with the IPEV guidelines 
as follows: 
 
 
 
 
                                                    31 December 2020  31 December 2019 
  Valuation Methodologies                                GBP'000           GBP'000 
--------------------------------------------------  ----------------  ---------------- 
Revenue multiple                                              20,597             4,156 
Discounted offer price                                        19,252                 - 
Cost and price of recent investment (reviewed for 
 impairment or uplift)                                        14,585            30,035 
Third party valuation -- Discounted cash flow                 11,413            11,523 
Earnings multiple                                              3,152             3,926 
Net assets                                                       653               231 
Third party valuation -- Earnings multiple                         -            14,089 
                                                              69,652            63,960 
                                                    ----------------  ---------------- 
 
 
   When using the cost or price of recent investment in the valuations, the 
Company looks to re-calibrate this price at each valuation point by 
reviewing progress within the investment, comparing against the initial 
investment thesis, assessing if there are any significant events or 
milestones that would indicate the value of the investment has changed 
and considering whether a market-based methodology (i.e. Using multiples 
from comparable public companies) or a discounted cashflow forecast 
would be more appropriate. 
 
   The main inputs into the calibration exercise, and for the valuation 
models using multiples, are revenue, EBITDA and P/E multiples (based on 
the most recent revenue, EBITDA or earnings achieved and equivalent 
corresponding revenue, EBITDA or earnings multiples of comparable 
companies), quality of earnings assessments and comparability difference 
adjustments. Revenue multiples are often used, rather than EBITDA or 
earnings, due to the nature of the Company's investments, being in 
growth and technology companies which are not normally expected to 
achieve profitability or scale for a number of years. Where an 
investment has achieved scale and profitability the Company would 
normally then expect to switch to using an EBITDA or earnings multiple 
methodology. 
 
   In the calibration exercise and in determining the valuation for the 
Company's equity instruments, comparable trading multiples are used. In 
accordance with the Company's policy, appropriate comparable companies 
based on industry, size, developmental stage, revenue generation and 
strategy are determined and a trading multiple for each comparable 
company identified is then calculated. The multiple is calculated by 
dividing the enterprise value of the comparable group by its revenue, 
EBITDA or earnings. The trading multiple is then adjusted for 
considerations such as illiquidity, marketability and other differences, 
advantages and disadvantages between the portfolio company and the 
comparable public companies based on company specific facts and 
circumstances. 
 
   Fair value investments had the following movements between valuation 
methodologies between 31 December 2019 and 31 December 2020: 
 
 
 
 
Change in valuation methodology                                   Value as at  Explanatory Note 
 (2019 to 2020)                                              31 December 2020 
                                                                      GBP'000 
--------------------------------------------------------  -------------------  -------------------------------------------------- 
Cost and price of recent investment (reviewed for                      18,037  Discounted revenue multiple more relevant based on 
 impairment) to revenue multiple                                                current trading 
Third party valuation -- Earnings multiple to discounted               14,948  Third party offer accepted and completed after the 
 offer price                                                                    year end 
Cost and price of recent investment (reviewed for                       4,304  Third party offer accepted 
 impairment) to discounted offer price 
Cost and price of recent investment (reviewed for                         304  Covid-19 impact on portfolio company has led to 
 impairment) to net assets                                                     revaluation 
Revenue multiple to net assets                                            139  Covid-19 impact on portfolio company has led to 
                                                                               revaluation 
 
 
 
   The valuation will be the most appropriate valuation methodology for an 
investment within its market, with regard to the financial health of the 
investment and the IPEV Guidelines. The Directors believe that, within 
these parameters, these are the most appropriate methods of valuation as 
at 31 December 2020. 
 
   FRS 102 and the SORP requires the Company to disclose the inputs to the 
valuation methods applied to its investments measured at FVTPL in a fair 
value hierarchy. The table below sets out fair value hierarchy 
definitions using FRS 102 s.11.27. 
 
 
 
 
Fair value hierarchy  Definition 
--------------------  ---------------------------------------------------- 
Level 1               The unadjusted quoted price in an active market 
--------------------  ---------------------------------------------------- 
Level 2               Inputs to valuations are from observable sources and 
                       are directly or indirectly derived from prices 
--------------------  ---------------------------------------------------- 
Level 3               Inputs to valuations not based on observable market 
                       data 
--------------------  ---------------------------------------------------- 
 
 
   Unquoted equity, preference shares, and loan stock are all valued 
according to Level 3 valuation methods. 
 
   Investments held at fair value through profit or loss (Level 3) had the 
following movements: 
 
 
 
 
                                        31 December 2020  31 December 2019 
                                             GBP'000           GBP'000 
--------------------------------------  ----------------  ---------------- 
Opening valuation                                 63,960            60,714 
Purchases at cost                                  3,991             6,136 
Unrealised gains                                   3,013               647 
Movement in loan stock accrued income                210             (147) 
Realised net gains on disposal                       320               443 
Disposal proceeds                                (1,842)           (3,832) 
Closing valuation                                 69,652            63,960 
                                        ----------------  ---------------- 
 
 
   FRS 102 requires the Directors to consider the impact of changing one or 
more of the inputs used as part of the valuation process to reasonable 
possible alternative assumptions. 63% of the portfolio of investments, 
consisting of equity and loan stock, is based on recent investment price, 
discounted offer price and net assets and cost, and as such the Board 
believe that changes to reasonable possible alternative input 
assumptions (by adjusting the earnings and revenue multiples) for the 
valuation of the remainder of the portfolio could lead to a significant 
change in the fair value of the portfolio. Therefore, for the remainder 
of the portfolio, the Board has adjusted the inputs for a number of the 
largest portfolio companies (by value) resulting in a total coverage of 
81% of the portfolio of investments. The main inputs considered for each 
type of valuation is as follows: 
 
 
 
 
                                                 Change in 
                                                fair value 
             Portfolio                              of         Change in NAV 
Valuation    company                 Base       investments     (pence per 
technique    sector       Input      Case*       (GBP'000)        share) 
-----------  -----------  ---------  ---------  -----------  ----------------- 
             Software 
Revenue       and other   Revenue 
 multiple     technology   multiple      Range        1,037               0.28 
-----------  -----------  ---------  ---------  -----------  ----------------- 
                                                    (1,010)             (0.27) 
  ---------------------------------  ---------  -----------  ----------------- 
Third party 
 valuation 
 -- 
 Discounted  Renewable    Discount 
 cash flow    energy       rate           5.8%          112               0.03 
-----------  -----------  ---------  ---------  -----------  ----------------- 
                                                      (101)             (0.03) 
  ---------------------------------  ---------  -----------  ----------------- 
             Software 
Earnings      and other   Earnings 
 multiple     technology   multiple       7.7x          143               0.04 
-----------  -----------  ---------  ---------  -----------  ----------------- 
                                                      (124)             (0.03) 
  ---------------------------------  ---------  -----------  ----------------- 
 
 
   *As detailed in the accounting policies, the base case is based on 
market comparables, discounted where appropriate for marketability, in 
accordance with the IPEV guidelines. 
 
   The impact of these changes could result in an overall increase in the 
valuation of the equity investments by GBP1,497,000 (2.9%) or a decrease 
in the valuation of equity investments by GBP1,438,000 (2.8%). 
 
   11.  Significant holdings 
 
   The principal activity of the Company is to select and hold a portfolio 
of investments in unquoted securities. Although the Company, through the 
Manager, will, in some cases, be represented on the board of the 
portfolio company, it will not ordinarily take a controlling interest or 
become involved in the management. The size and structure of companies 
with unquoted securities may result in certain holdings in the portfolio 
representing a participating interest without there being any 
partnership, joint venture or management consortium agreement. 
 
   The Company has interests of greater than 20% of the nominal value of 
any class (some of which are non-voting) of the allotted shares in the 
portfolio companies as at 31 December 2020 as described below. The 
investments listed below are held as part of an investment portfolio and 
therefore, as permitted by FRS 102, they are measured at fair value and 
are not accounted for using the equity method. 
 
 
 
 
           Registered 
           address and     Profit/(loss)                                                    % total 
           country of      before tax      Aggregate capital and reserves  % class and      voting 
Company    incorporation   GBP'000          GBP'000                        share type       rights 
---------  --------------  --------------  ------------------------------  ---------------  ------- 
Academia                                                                   23.2% Preferred 
 Inc.      CA 94108, USA              n/a                             n/a           shares   3.0% 
Active 
 Lives 
 Care                                                                       20.3% Ordinary 
 Limited   EC1M 5QL, UK             (274)                         (2,562)           shares   20.3% 
                                                                           22.0% Preferred 
                                                                             shares; 33.0% 
Antenova                                                                          Ordinary 
Limited    EC4A 3TW, UK              n/a*                           2,515           shares   28.7% 
                                                                            48.1% Ordinary 
Elateral                                                                     shares; 46.5% 
Group                                                                            Preferred 
Limited    GU9 7XX, UK            (1,396)                         (9,284)           shares   47.9% 
Sift                                                                        42.1% Ordinary 
 Limited   BS1 4EX, UK               n/a*                              74           shares   42.1% 
 
 
   *The company files filleted accounts which does not disclose this 
information. 
 
   12.  Current assets 
 
 
 
 
 
                                        31 December 2020  31 December 2019 
Trade and other receivables                  GBP'000           GBP'000 
--------------------------------------  ----------------  ---------------- 
Other receivables                                      -                29 
Prepayments and accrued income                        19                15 
Deferred consideration under one year                124                71 
Deferred consideration over one year               1,150                 - 
                                                   1,293               115 
                                        ----------------  ---------------- 
 
 
   The deferred consideration over one year relates to the sale of 
G.Network Communications Limited in December 2020. These proceeds are 
receivable in January 2024, and have been discounted to present value at 
the prevailing market rate, including a provision for counterparty risk. 
This constitutes a financing transaction, and has been accounted for 
using the policy disclosed in note 1. 
 
   The Directors consider that the carrying amount of receivables is not 
materially different to their fair value. 
 
 
 
 
                                                    31 December 2020  31 December 2019 
13. Payables: amounts falling due within one year        GBP'000           GBP'000 
--------------------------------------------------  ----------------  ---------------- 
Trade payables                                                    15                22 
Accruals and deferred income                                     487               464 
                                                                 502               486 
                                                    ----------------  ---------------- 
 
 
   The Directors consider that the carrying amount of payables is not 
materially different to their fair value. 
 
   14. Called-up share capital 
 
 
 
 
Allotted, called-up and fully paid                            GBP'000 
------------------------------------------------------------  ------- 
388,335,260 Ordinary shares of 1 penny each at 31 
 December 2019                                                  3,883 
46,222,217 Ordinary shares of 1 penny each issued 
 during the year                                                  462 
------------------------------------------------------------  ------- 
434,557,477 Ordinary shares of 1 penny each at 31 
 December 2020                                                  4,346 
------------------------------------------------------------  ------- 
 
54,723,000 Ordinary shares of 1 penny each held in 
 treasury at 31 December 2019                                   (547) 
5,768,609 Ordinary shares purchased during the year 
 to be held in treasury                                          (58) 
------------------------------------------------------------  ------- 
60,491,609 Ordinary shares of 1 penny each held in 
 treasury at 31 December 2020                                   (605) 
------------------------------------------------------------  ------- 
 
374,065,868 Ordinary shares of 1 penny each in circulation* 
 at 31 December 2020                                            3,741 
------------------------------------------------------------  ------- 
 
 
   *Carrying one vote each 
 
   During the year the Company purchased 5,768,609 Ordinary shares (2019: 
6,450,000) representing 1.3% of the issued Ordinary share capital as at 
31 December 2020, at a cost of GBP1,100,000 (2019: GBP1,367,000), 
including stamp duty, to be held in treasury. The Company holds a total 
of 60,491,609 Ordinary shares in treasury, representing 13.9% of the 
issued Ordinary share capital as at 31 December 2020. 
 
   Under the terms of the Dividend Reinvestment Scheme Circular dated 19 
April 2011, the following new Ordinary shares of nominal value 1 penny 
per share were allotted during the year: 
 
 
 
 
                                               Aggregate 
                                                 nominal 
                                                  value 
                                                of shares     Issue price      Net invested  Opening market price on allotment date 
Date of allotment   Number of shares allotted   (GBP'000)   (pence per share)    (GBP'000)              (pence per share) 
------------------  -------------------------  ----------  ------------------  ------------  -------------------------------------- 
30 April 2020                       1,521,895          15               19.19           290                                   18.50 
30 October 2020                     1,220,692          12               19.79           240                                   18.80 
                                               ---------- 
                                    2,742,587          27                               530 
                    -------------------------  ----------                      ------------ 
 
 
   During the period from 1 January 2020 to 31 December 2020, the Company 
issued the following new Ordinary shares of nominal value 1 penny each 
under the Albion VCT Prospectus Top Up Offers 2019/20: 
 
 
 
 
                                      Aggregate 
                                        nominal 
                                         value 
                    Number of shares   of shares     Issue price        Net consideration received  Opening market price on allotment date 
Date of allotment       allotted       (GBP'000)   (pence per share)            (GBP'000)                      (pence per share) 
------------------  ----------------  ----------  ------------------  ----------------------------  -------------------------------------- 
31 January 2020            5,082,101          51               22.40                         1,121                                   21.10 
31 January 2020            1,019,398          10               22.50                           225                                   21.10 
31 January 2020           36,336,304         363               22.70                         8,042                                   21.10 
30 April 2020                418,451           4               19.50                            80                                   18.50 
30 April 2020                623,376           6               19.70                           120                                   18.50 
                          43,479,630         435                                             9,588 
                    ----------------  ----------                      ---------------------------- 
 
 
   15.  Basic and diluted net asset value per share 
 
 
 
 
                           31 December 2020 (pence  31 December 2019 (pence 
                                 per share)                per share) 
------------------------   -----------------------  ------------------------ 
Basic and diluted net 
 asset value per Ordinary 
 share                                       21.84                     22.02 
 
 
   The basic and diluted net asset values per share at the year end are 
calculated in accordance with the Articles of Association and are based 
upon total shares in issue (adjusting for treasury shares) of 
374,065,868 Ordinary shares as at 31 December 2020 (2019: 333,612,260). 
 
   16. Capital and financial instruments risk management 
 
   The Company's capital comprises Ordinary shares as described in note 14. 
The Company is permitted to buy back its own shares for cancellation or 
treasury purposes and this policy is described in more detail in the 
Chairman's statement. 
 
   The Company's financial instruments comprise equity and loan stock 
investments in unquoted companies, cash balances and liquid cash 
instruments and short term receivables and payables which arise from its 
operations. The main purpose of these financial instruments is to 
generate cash flow, revenue and capital appreciation for the Company's 
operations. The Company has no gearing or other financial liabilities 
apart from short term payables. The Company does not use any derivatives 
for the management of its Balance sheet. 
 
   The principal financial instrument risks arising from the Company's 
operations are: 
 
 
   -- investment (or market) risk (which comprises investment price and cash 
      flow interest rate risk); 
 
   -- credit risk; and 
 
   -- liquidity risk. 
 
 
   The Board regularly reviews and agrees policies for managing each of 
these risks. There have been no changes in the nature of the risks that 
the Company has faced during the past year and there have been no 
changes in the objectives, policies or processes for managing risks 
during the past year. The key risks are summarised below. 
 
   Investment risk 
 
   As a Venture Capital Trust, it is the Company's specific nature to 
evaluate and control the investment risk in its portfolio in unquoted 
and quoted investments, details of which are shown on pages 23 and 24 of 
the full Annual Report and Financial Statements. Investment risk is the 
exposure of the Company to the revaluation and devaluation of 
investments. The main driver of investment risk is the operational and 
financial performance of the portfolio company and the dynamics of 
market quoted comparators. The Manager receives management accounts from 
portfolio companies and members of the investment management team often 
sit on the boards of unquoted portfolio companies; this enables the 
close identification, monitoring and management of investment risk. 
 
   The Manager and the Board formally review investment risk (which 
includes market price risk), both at the time of initial investment and 
at quarterly Board meetings. 
 
   The Board monitors the prices at which sales of investments are made to 
ensure that profits to the Company are maximised and that valuations of 
investments retained within the portfolio appear sufficiently fair and 
realistic compared to prices being achieved in the market for sales of 
unquoted investments. 
 
   The maximum investment risk as at the Balance sheet date is the value of 
the fixed asset investment portfolio which is GBP69,652,000 (2019: 
GBP63,960,000). Fixed asset investments form 85% of the net asset value 
as at 31 December 2020 (2019: 87%). 
 
   More details regarding the classification of fixed asset investments are 
shown in note 10. 
 
   Investment price risk 
 
   Investment price risk is the risk that the fair value of future 
investment cash flows will fluctuate due to factors specific to an 
investment instrument or to a market in similar instruments. As a 
Venture Capital Trust the Company invests in unquoted companies in 
accordance with the investment policy. The management of risk within the 
venture capital portfolio is addressed through careful investment 
selection, by diversification across different industry segments, by 
maintaining a wide spread of holdings in terms of financing stage and by 
limitation of the size of individual holdings. The Directors monitor the 
Manager's compliance with the investment policy, review and agree 
policies for managing this risk and monitor the overall level of risk on 
the investment portfolio on a regular basis. 
 
   Valuations are based on the most appropriate valuation methodology for 
an investment within its market, with regard to the financial health of 
the investment and the IPEV guidelines. Details of the sectors in which 
the Company is currently invested are shown in the pie chart at the end 
of this announcement. 
 
   As required under FRS 102 the Board is required to illustrate by way of 
a sensitivity analysis the extent to which the assets are exposed to 
market risk. The Board considers that the value of the fixed asset 
investment portfolio is sensitive to a change of 10% based on the 
current economic climate. The impact of a 10% change has been selected 
as this is considered reasonable given the current level of volatility 
observed. When considering the appropriate level of sensitivity to be 
applied, the Board has considered both historic performance and future 
expectations. 
 
   The sensitivity of a 10% increase or decrease in the valuation of the 
fixed asset investment portfolio (keeping all other variables constant) 
would increase or decrease the net asset value and return for the year 
by GBP6,965,000. Further sensitivity analysis on fixed asset investments 
is included in note 10. 
 
   Interest rate risk 
 
   It is the Company's policy to accept a degree of interest rate risk on 
its financial assets through the effect of interest rate changes. On the 
basis of the Company's analysis, it is estimated that a rise of 1% in 
all interest rates would have increased total return before tax for the 
year by approximately GBP70,000 (2019: GBP86,000). Furthermore, it is 
considered that a material fall of interest rates below current levels 
during the year would have been unlikely. 
 
   The weighted average effective interest rate applied to the Company's 
fixed rate assets during the year was approximately 9.8% (2019: 10.2%). 
The weighted average period to maturity for the fixed rate assets is 
approximately 7.7 years (2019: 8.4 years). 
 
   The Company's financial assets and liabilities, denominated in Sterling, 
consist of the following: 
 
 
 
 
                                        31 December 2020                                                     31 December 2019 
                                     Floating rate  Non-interest bearing   Total                          Floating rate  Non-interest bearing   Total 
                 Fixed rate GBP'000     GBP'000            GBP'000         GBP'000    Fixed rate GBP'000     GBP'000            GBP'000         GBP'000 
-------------  --------------------  -------------  --------------------  --------  --------------------  -------------  --------------------  -------- 
Unquoted 
 equity                           -              -                51,072    51,072                     -              -                44,833    44,833 
Unquoted loan 
 stock                       17,301            584                   695    18,580                17,877            609                   641    19,127 
Receivables*                      -              -                 1,274     1,274                     -              -                   101       101 
Payables                          -              -                 (502)     (502)                     -              -                 (486)     (486) 
Cash                              -         11,266                     -    11,266                     -          9,867                     -     9,867 
               --------------------  -------------  --------------------  --------  --------------------  -------------  --------------------  -------- 
Total net 
 assets                      17,301         11,850                52,539    81,690                17,877         10,476                45,089    73,442 
               --------------------  -------------  --------------------  --------  --------------------  -------------  --------------------  -------- 
 
 
   *The receivables do not reconcile to the Balance sheet as prepayments 
are not included in the above table. 
 
   Credit risk 
 
   Credit risk is the risk that the counterparty to a financial instrument 
will fail to discharge an obligation or commitment that it has entered 
into with the Company. The Company is exposed to credit risk through its 
receivables, investment in unquoted loan stock and through the holding 
of cash on deposit with banks. 
 
   The Manager evaluates credit risk on loan stock instruments prior to 
investment and as part of its ongoing monitoring of investments. For 
investments made prior to 6 April 2018, which account for 96 per cent. 
of loan stock value, typically loan stock instruments will have a fixed 
or floating charge, which may or may not be subordinated, over the 
assets of the portfolio company in order to mitigate the gross credit 
risk. 
 
   The Manager receives management accounts from portfolio companies and 
members of the investment management team often sit on the boards of 
unquoted portfolio companies; this enables the close identification, 
monitoring and management of investment specific credit risk. 
 
   The Manager and the Board formally review credit risk (including 
receivables) and other risks, both at the time of initial investment and 
at quarterly Board meetings. 
 
   The Company's total gross credit risk at 31 December 2020 was limited to 
GBP18,580,000 (2019: GBP19,127,000) of unquoted loan stock instruments, 
GBP11,266,000 (2019: GBP9,867,000) cash on deposit with banks and 
GBP1,293,000 (2019: GBP115,000) of other receivables. 
 
   As at the Balance sheet date, cash and liquid investments held by the 
Company are held with the National Westminster Bank plc, Scottish Widows 
Bank plc (part of Lloyds Banking Group plc), and Barclays Bank plc. 
Credit risk on cash transactions is mitigated by transacting with 
counterparties that are regulated entities subject to regulatory 
supervision, with high credit ratings assigned by international 
credit-rating agencies. 
 
   The credit profile of unquoted loan stock is described under liquidity 
risk below. 
 
   Liquidity risk 
 
   Liquid assets are held as cash on current account, deposit or short term 
money market accounts or similar instruments.  Under the terms of its 
Articles, the Company has the ability to borrow an amount equal to its 
adjusted capital and reserves of the latest published audited Balance 
sheet, being GBP79,064,000 (2019: GBP71,200,000). As at 31 December 
2020, the Company had no actual short term or long term gearing (2019: 
GBPnil). The Directors do not currently have any intention to utilise 
gearing. 
 
   The Company has no committed borrowing facilities as at 31 December 2020 
(2019: GBPnil) and had cash of GBP11,266,000 (2019: GBP9,867,000). The 
Company had no investment commitments as at 31 December 2020 (2019: 
GBPnil). 
 
   There are no externally imposed capital requirements other than the 
minimum statutory share capital requirements for public limited 
companies. 
 
   The main cash outflows are for new investments, the buy-back of shares 
and dividend payments, which are within the control of the Company. The 
Manager formally reviews the cash requirements of the Company on a 
monthly basis, and the Board on a quarterly basis as part of its review 
of management accounts and forecasts. The Company's financial 
liabilities at 31 December 2020 are short term in nature and total 
GBP502,000 (2019: GBP486,000). 
 
   The carrying value of loan stock investments analysed by expected 
maturity dates is as follows: 
 
 
 
 
                                31 December 2020                                          31 December 2019 
Redemption   Fully performing  Past due  Valued below cost   Total          Fully        Past due  Valued below cost   Total 
date              GBP'000       GBP'000       GBP'000        GBP'000  performingGBP'000   GBP'000       GBP'000        GBP'000 
-----------  ----------------  --------  -----------------  --------  -----------------  --------  -----------------  -------- 
Less than 
 one year               8,783       307                102     9,192              6,100       265                102     6,467 
1-2 years               1,602        34                 35     1,671              2,233         -                  -     2,233 
2-3 years                  86         -                440       526              1,528         -                 61     1,589 
3-5 years                 395        28                 90       513                347     1,362                123     1,832 
5 + years               6,540       138                  -     6,678              6,824       154                 28     7,006 
             ----------------  --------  -----------------  --------  -----------------  --------  -----------------  -------- 
Total                  17,406       507                667    18,580             17,032     1,781                314    19,127 
             ----------------  --------  -----------------  --------  -----------------  --------  -----------------  -------- 
 
   Loan stock can be past due as a result of interest or capital not being 
paid in accordance with contractual terms. The cost of loan stock valued 
below cost is GBP3,132,000 (2019: GBP517,000). 
 
 
 
   In view of the factors identified above, the Board considers that the 
Company is subject to low liquidity risk. 
 
   Fair values of financial assets and financial liabilities 
 
   All the Company's financial assets and liabilities as at 31 December 
2020 are stated at fair value as determined by the Directors, with the 
exception of receivables (including debtors due after more than one 
year), payables and cash which are carried at amortised cost, in 
accordance with FRS 102. There are no financial liabilities other than 
payables. The Company's financial liabilities are all non-interest 
bearing. It is the Directors' opinion that the book value of the 
financial liabilities is not materially different to the fair value and 
all are payable within one year. 
 
   17.  Commitments, contingencies and guarantees 
 
   As at 31 December 2020, the Company had no financial commitments (2019: 
GBPnil). 
 
   There were no contingent liabilities or guarantees given by the Company 
as at 31 December 2020 (2019: GBPnil). 
 
   18.  Post balance sheet events 
 
   Since the year end, the Company made the following investment 
transactions: 
 
 
   -- Proceeds of GBP15.4 million were received for the sale of the Company's 
      three care homes; Active Lives Care Limited, Ryefield Court Care Limited 
      and Shinfield Lodge Care Limited; 
 
   -- Proceeds of GBP3.0 million were received for the sale of OmPrompt 
      Holdings Limited; 
 
   -- Investment of GBP917,000 in a new portfolio company, Threadneedle 
      Software Holding Limited (T/A Solidatus); 
 
   -- Investment of GBP468,000 in an existing portfolio company, Healios 
      Limited; 
 
   -- Proceeds of GBP360,000 were received for the sale of SBD Automotive 
      Limited; and 
 
   -- Investment of GBP46,000 in an existing portfolio company, ePatient 
      Network Limited (T/A Raremark). 
 
 
   The following new Ordinary shares of nominal value 1 penny each were 
allotted under the Albion VCTs Prospectus Top Up Offers 2020/21 after 31 
December 2020: 
 
 
 
 
                        Aggregate 
             Number of   nominal                                  Net 
   Date of      shares  value of                             consideration 
 allotment    allotted   shares      Issue price (pence per    received       Opening market price on allotment date 
                         GBP'000            share)              GBP'000                (pence per share) 
----------  ----------  ---------  ------------------------  -------------  ---------------------------------------- 
        26 
  February 
      2021   5,412,326         54                      21.6          1,151                                     20.10 
        26 
  February 
      2021   1,536,392         15                      21.7            327                                     20.10 
        26 
  February 
      2021  59,778,526        598                      21.8         12,706                                     20.10 
            66,727,244        667                                   14,184 
            ----------  ---------                            ------------- 
 
 
 
   19.  Related party transactions 
 
   Other than transactions with the Manager as disclosed in note 4, and the 
Directors' remuneration disclosed in the Directors' remuneration report 
on page 44 of the full Annual Report and Financial Statements there are 
no related party transactions or balances requiring disclosure. 
 
   20. Other information 
 
   The information set out in this announcement does not constitute the 
Company's statutory accounts within the terms of section 434 of the 
Companies Act 2006 for the years ended 31 December 2020 and 31 December 
2019, and is derived from the statutory accounts for those financial 
years, which have been, or in the case of the accounts for the year 
ended 31 December 2020, which will be, delivered to the Registrar of 
Companies. The Auditor reported on those accounts; the reports were 
unqualified and did not contain a statement under s498 (2) or (3) of the 
Companies Act 2006. 
 
   21. Publication 
 
   The full audited Annual Report an Financial Statements are 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 
https://www.globenewswire.com/Tracker?data=IeaQ627d2CsGwLaH7G-fn1rTKtV44hImf4qCvoti41Tf0JNbnyzaXB03QO6DUX43T5ccHoGaCCYzU-9QQOeIdQlj4qjCGsMXuEgVW7U5OVkTo4eTJVdG5kbReMvwH_73Vya6PozpSZl4e5vFbp14CO-HLc408xRXYw4XcCSCnRM= 
www.albion.capital/funds/KAY/31Dec2020.pdf. 
 
 
 
   Attachment 
 
 
   -- Split of Portfolio by sector, stage of investment and number of employees 
      https://ml-eu.globenewswire.com/Resource/Download/4146b370-d027-424f-89e5-3b17f6790de2 
 
 
 
 
 
 
 

(END) Dow Jones Newswires

March 26, 2021 14:47 ET (18:47 GMT)

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