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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Mobeus Income & Growth Vct Plc | LSE:MIX | London | Ordinary Share | GB00B01WL239 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 56.00 | 54.50 | 57.50 | 56.00 | 56.00 | 56.00 | 540,913 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Investors, Nec | -15.97M | -18.79M | -0.1128 | -4.96 | 93.29M |
From Apr 2019 to Apr 2024
TIDMMIX
RNS Number : 1146J
Mobeus Income & Growth VCT PLC
27 March 2018
mobeus Income & Growth VCT plc
Annual Financial Results of the Company for the Year ended 31 December 2017
Mobeus Income & Growth VCT plc (the "Company") today announces the final results for the year ended 31 December 2017. These results were approved by the Board of Directors on 27 March 2018. You may, in due course, view the Annual Report & Financial Statements, comprising the statutory accounts of the Company by visiting www.migvct.co.uk.
Financial Highlights
Hot Features
Premium
As at 31 December 2017:
Net assets: GBP69.90 million
Net asset value ("NAV") per share: 71.75 pence
- Net asset value total return per share was 8.6% for the
year.
- Share price total return per share was 9.7% for the year.
- Dividends paid and proposed in respect of the year total
16.00 pence per share. The proposed final dividend of 3.00
pence per share, if approved, will bring cumulative dividends
paid to shareholders in respect of the past five years to
71.75 pence per share.
- The Company realised investments totalling GBP17.19 million
of cash proceeds and generated realised gains over original
investment cost of GBP5.41 million.
- The company invested a total of GBP5.10(*) million into
four new growth capital investments and two follow-on investments
during the year.
(*) Includes GBP2.76 million previously held in companies
preparing to trade
PERFORMANCE SUMMARY
As at 31 December 2017 the Company had net assets of GBP69.90
million and the net asset value ("NAV") per share was 71.75
pence.
The table below shows the recent past performance of the Company's
existing class of shares for each of the last five years.
Reporting Net NAV Share Cumulative Cumulative total Dividends
date assets per price(1) dividends return per share paid and
share paid per to shareholders(2) proposed
share per share
in respect
of each year
As at (NAV (Share
31 December basis) price
basis)
(GBPm) (p) (p) (p) (p) (p) (p)
2017 69.90 71.75 63.00 108.80 180.55 171.80 16.00 (3)
2016 63.15 83.53 74.75 89.80 173.33 164.55 14.50
2015 74.11 97.54 86.50 74.360 171.84 160.80 10.00
2014 60.41 99.44 86.00 64.30 163.74 150.30 24.00
2013 54.27 102.18 87.50 44.05 146.23 131.55 7.25
(1) Source: Panmure Gordon & Co. (mid-market price)
(2) Cumulative total return per share comprises the NAV per share
(NAV basis) or the mid-market price per share (Share Price Basis)
plus cumulative dividends paid since launch in October 2004.
(3) The figure of 16.00 pence includes the proposed final dividend
of 3.00 pence per share referred to in the Financial Highlights
above, payment of which, if approved, will reduce the net assets
per share from the 31 December 2017 figure of 71.75 pence by
the amount of the dividend.
Chairman's Statement
I am pleased to present the annual results of Mobeus Income &
Growth VCT plc for the year ended 31 December 2017.
Overview
This has been another year of good performance by the Company.
Returns to shareholders have again been positive, principally
due to three profitable portfolio company exits as well as a
strong income return. Further comment can be found under the
'Performance' section of my Statement below and in the Investment
Adviser's Review.
The Company and the Investment Adviser have responded well to
the VCT Rules introduced by the Finance (No2) Act 2015, having
completed twelve growth capital investments since the change
in the Company's investment policy. The Investment Adviser has
continued to recruit experienced growth capital investors into
its team and reports a healthy pipeline of investments.
Most recently, additional changes to VCT legislation were proposed
in the 2017 Autumn Budget Statement. Your Board does not believe
that the changes arising from the Patient Capital Review will
materially affect the Company's existing investment policy. Further
details can be found under the 'Industry and Regulatory Developments'
section of my statement below.
Fundraising
On 6 September 2017, the Company launched an Offer for Subscription
to raise up to GBP25 million in aggregate. I am delighted to
report that there was strong demand for the Offer and that the
full amount was raised by 13 March 2018. 33,543,458 shares have
been allotted at offer prices ranging from 70.08 to 79.69 pence
per share, depending on the prevailing net asset value at the
date of each allotment and the method by which each investor
subscribed for the Offer. The Board is pleased to achieve its
fundraising target comfortably ahead of the end of the current
tax year and would like to thank all new investors and shareholders,
their advisers and intermediaries, for their support.
Performance
The NAV total return per share for the year ended 31 December
2017 was 8.6% (2016: 1.5%) (being the closing NAV plus dividends
paid in the year, divided by the opening NAV) while the share
price total return was 9.7% (2016: 4.3%). The uplift in Net Asset
Value per share was 7.22 pence per share based upon the number
of shares in issue at the year end. As a result of this performance,
the NAV cumulative total return per share (being the closing
NAV plus total dividends paid to date since launch) rose during
the year by 4.2% from 173.33 pence to 180.55 pence.
This NAV return for the year was primarily attributable to the
sale of the Company's investments in Entanet Holdings Limited
and Gro-Group Holdings Limited and another year of good revenue
returns, arising principally from income from loan stock investments.
Dividends
Your Board is proposing a final dividend in respect of the year
ended 31 December 2017 of 3.00 pence per share (2016: nil).
The dividend, comprising 1.50 pence from capital, of which 1.00
pence was from the special distributable reserve, and 1.50 pence
from income, will be proposed to shareholders at the Annual General
Meeting of the Company to be held on 9 May 2018, to shareholders
on the register on 27 April 2018, for payment on 17 May 2018.
This final dividend is in addition to the first interim dividend
of 9.00 pence paid on 13 September 2017 and the second interim
dividend of 4.00 pence paid on 8 December 2017.
If approved by shareholders, this forthcoming final dividend
will bring total dividends paid in respect of the year ended
31 December 2017 to 16.00 pence (2016: 14.50 pence) per share,
bringing cumulative dividends paid since inception in 2004 to
111.80 pence (2016: 95.80 pence) per share.
The Company's target of paying a dividend of at least 4.00 pence
per share in respect of each financial year has been exceeded
in each of the last eight years. While the Board still believes
in the attainment of the dividend target, the gradual move of
the portfolio to growth capital investments may make it harder
to achieve in a given year without recourse to the Company's
reserves. A full dividend history is contained in the Performance
Data appendix in the Annual Report and on the Company's website.
Investment portfolio
For the year under review, the portfolio as a whole achieved
a net increase of GBP5.25 million on investments realised but
a decrease of GBP0.57 million on investments still held. Investment
realisations produced GBP5.41 million in capital gains in excess
of original investment cost. On a like-for-like basis, adding
back realisations and excluding new investments, the value of
the portfolio increased by 9.1% (2016: 0.8% increase). At the
year end the remaining portfolio, including companies preparing
to trade, was valued at GBP41.52 million or 98.3% of cost (2016:
GBP51.68 million / 104.2% of cost).
During the year GBP4.65 million was invested in four new growth
capital investments and GBP0.45 million in two existing portfolio
companies. These new growth capital companies were: Tapas Revolution,
a leading Spanish restaurant chain; Buster + Punch, a London-based
interiors brand; MyTutorweb, an online tutoring business; and
Wetsuit Outlet, a leading online retailer in the water sports
market. In addition, two follow-on investments were made: GBP0.29
million was invested into Mpb, an online marketplace for used
camera and video equipment and GBP0.16 million was invested into
BookingTek, a provider of direct booking systems to major hotel
groups. Following the year end, new investments were made into
Proactive Investors (GBP0.42 million); SuperCarers Limited (GBP0.58
million) and Hemmels Limited (GBP0.60 million) and a follow-on
investment was made into Mpb (GBP0.43 million). Further details
of these investments are set out in the Investment Adviser's
Review below.
Shareholders should note that, at the year end, 62.5% of the
value of the investment portfolio was held in MBO type investments
and 37.5% was held in growth capital investments. Of the growth
capital investments, GBP10.21 million has been invested since
the introduction of the VCT rules in 2015.
The Company received cash proceeds totalling GBP17.19 million;
GBP9.94 million from the realisation of three investments; GBP6.35
million from loan stock repayments; and GBP0.90 million of other
receipts. Of the amount received from realisations, GBP9.94 million
was received as cash proceeds from the disposals of Entanet Holdings
Limited, Omega Diagnostics and Gro-Group Holdings Limited, (equating
to a 5.20 pence uplift in NAV based upon the number of shares
at the year-end).
Full details of the investment activity during the year and a
summary of the performance highlights can be found in the Investment
Adviser's Review below.
Review of longer term performance
Shareholders who invested in 2004 at the launch of the Company
have seen a NAV cumulative total return of 180.55 pence per share
compared with their initial investment cost of 100 pence per
share, or a net cost of 60 pence per share (after initial income
tax relief of 40 pence of their investment). As part of this
return 108.80 pence per share has been paid to shareholders in
dividends. This represents an average annual yield on the initial
100 pence investment of 8.2% and 13.7% on the adjusted investment
cost of 60 pence (net of 40 pence of initial income tax relief).
The balance of the total return is the closing NAV of 71.75 pence
per share.
The Board also regularly reviews the Company's total (income
and capital) return performance on both a NAV and Share Price
basis compared to its peer group. Based on the statistics prepared
by Morningstar at 31 December 2017, the Company was ranked 9(th)
on both a NAV total return basis and a Share Price total return
basis out of 30 generalists (including planned exit) VCTs monitored
by the Association of Investment Companies ("AIC") over the last
ten years. The Board believes this to be a satisfactory performance.
Buybacks of the Company's own shares
During the year ended 31 December 2017, the Company made three
purchases of its shares, buying back a total of 559,948 shares,
allowing shareholders who wanted to sell their shares to do so.
The buybacks represented 0.7% of the issued share capital of
the Company at the beginning of the year. Further details are
included in the Strategic Report in the Annual Report. The shares
bought back were subsequently cancelled.
Industry and regulatory developments
As mentioned in my overview, the UK Government has undertaken
a Patient Capital Review to identify and tackle factors considered
to be adversely affecting the supply of longer term capital to
small and developing firms. The consultation period closed on
22 September 2017 and strong representations were made on behalf
of the VCT industry by Mobeus as Investment Adviser, the Venture
Capital Trust Association and the Association of Investment Companies.
The 2017 Autumn Budget Statement outlined the key findings from
the review including a number of legislative changes to the VCT
scheme, the earliest of which came into effect on 15 March 2018.
These changes are designed to exclude tax-motivated investments
where capital is not at risk (that is, principally seeking to
preserve investors' capital) and to encourage VCTs to put their
money to work faster.
Your Board notes the initiatives behind these changes. While
some of these changes place further restrictions on the way investments
may be structured, the Board currently has no reason to believe
they will materially affect the Company's existing investment
policy.
A summary of the current VCT regulations and the new changes
are included in the Annual Report.
Key Information Document
From 1st January 2018 the EU PRIIPs regulations came into force,
mandating the format and content of a Key Information Document
('KID') to be provided by investment products, including VCTs.
The KID is intended to allow comparison of certain aspects of
investments on a common basis, for the benefit of investors.
The KID is required to show both a risk rating and a projection
of future possible returns under various scenarios. These numbers
come from adherence to prescribed and detailed calculation methodologies
but, in essence, derive from the historical volatility of the
share price over the last five years.
Whilst historic volatility is one measure of risk, it is not
the only measure nor is it necessarily an accurate guide and
returns, particularly under the stress scenario, could be lower
than those indicated in the table. Whilst not wishing to detract
from the KID, I would therefore like to caution investors not
to place too much reliance on either the risk rating or the future
returns, where historic volatility alone over a particular five
year period may not be the most useful guide. Investors should
also note that the historic volatility was largely derived from
a portfolio of MBO investments whereas, over time, the portfolio
will now be shifting towards growth capital investments.
Shareholder Event
This year's annual shareholder event was held on Tuesday, 30
January 2018 at the Royal Institute of British Architects in
Central London. Separate day time and evening sessions included
presentations on the Mobeus advised VCTs' investment activity
and performance. We have received positive feedback from many
of the c.300 people who attended the event and were pleased to
hear that overall they found the day informative and worthwhile.
The next shareholder event will be held in February 2019.
Annual General Meeting
The next Annual General Meeting of the Company will be held at
2:00 p.m. on Wednesday, 9 May 2018 at The Clubhouse, 8 St James's
Square, London SW1Y 4JU. Both the Board and the Investment Adviser
look forward to welcoming shareholders to the meeting which will
include a presentation from the Investment Adviser on the investment
portfolio. Shareholders are encouraged to attend and to ask questions
of the Board and the Investment Adviser. The Notice of the meeting
and an explanation of the resolutions to be proposed can be found
in the Annual Report.
Outlook
Your Board considers that your Company is well positioned to
take advantage of the strong demand for growth capital investment,
although entry valuations can be quite full for the most interesting
opportunities. The portfolio has a solid foundation of investments
made under the previous MBO strategy, the majority of which are
mature and profitable companies providing attractive income returns.
We are delighted with the strong support from shareholders for
our fundraising, which is currently anticipated to be fully subscribed.
This will provide the Company with sufficient funds to meet its
cash needs and to continue the current investment rate in the
medium term.
Finally, I would like to take this opportunity once again to
thank all Shareholders for their continued support.
Clive Boothman
Chairman
INVESTMENT POLICY
The Company's policy is to invest primarily in a diverse portfolio
of UK unquoted companies. Investments are generally structured
as part loan and part equity in order to receive regular income,
to generate capital gains upon sale and to reduce the risk of
high exposure to equities. To spread the risk further, investments
are made in a number of businesses across different industry sectors.
The Company's cash and liquid resources are held in a range of
instruments which can be of varying maturities, subject to the
overriding criterion that the risk of loss of capital be minimised.
The Company seeks to make investments in accordance with the requirements
of VCT regulation. The full text of the Company's Investment Policy
is available in the Strategic Report section of the Annual Report.
Investment ADVISER'S Review
Portfolio Review
This has been a year of continued progress within the portfolio
with the addition of four new growth capital investments totalling
GBP4.65 million, two existing growth investments receiving follow-on
funding totalling GBP0.45 million, and three profitable disposals
generating net cash proceeds of GBP9.94 million. The past year's investment and divestment activity has increased the proportion of the investment portfolio comprised of growth capital investments to 37.5%. The Company now holds GBP10.21 million in growth capital investments made since the change in VCT regulations in 2015. The valuation of the remaining portfolio decreased by GBP0.57 million during the year under review. This net decrease in value is primarily due to reductions in the valuations of Veritek Global, Media Business Insight and Virgin Wines outweighing uplifts elsewhere in the portfolio such as Vectair and Master Removers. A small number of new growth investments have shown initial uplifts from cost, due in large part to the structure of the Company's investment, but also due to the underlying investee company performance. On the whole, the growth capital portfolio is trading within plan which is an encouraging start. Demand for growth capital investment remains strong and there is a large pipeline of investment opportunities. We expect that follow-on funding into existing portfolio companies to support growth plans will be a significant feature over the coming months and years. Impact of Budget Changes As the Chairman's Statement noted, over the course of 2017 the UK Government conducted a review to identify and tackle factors considered to be adversely affecting the supply of longer term capital to small and developing firms. As anticipated, the 2017 Autumn Budget outlined the key findings from the review, including a number of changes to the VCT scheme, the earliest of which came into effect on 15 March 2018. These changes are summarised in the Annual Report. Mobeus, as Investment Adviser, believe that, overall, these changes should not materially affect the ability of the Company to continue to make successful growth capital investments. New investment in the year A total of GBP5.10 million was invested in new and existing investments during the year under review. New investments of GBP4.65 million were made into Tapas Revolution, Buster + Punch, MyTutorweb and Wetsuit Outlet; all new growth capital investments. In addition, the Company made GBP0.45 million of follow-on investment into BookingTek and Mpb to support growth and development.
Further details of these investments are set out below:
Company Business Date of investment Amount of new investment
(GBPm)
------------------ ------------------ -------------------- -------------------------
Tapas Revolution Restaurant chain January 2017 0.69
------------------ ------------------ -------------------- -------------------------
Based in London, Ibericos Etc. Limited (which trades as Tapas
Revolution) is a leading Spanish restaurant chain in the casual
dining sector, focussing on shopping centre sites with high footfall.
Having opened its first restaurant in Shepherd's Bush Westfield,
the business has since opened a further six restaurants. The
investment provided growth capital to a high-calibre team with
significant restaurant rollout experience which has spent the
past five years building and refining its offer and is now well
placed to capitalise on a strong pipeline of new sites. The company's
latest accounts for the period ended 25 October 2016 show a turnover
of GBP4.25 million and loss before interest, tax and amortisation
of goodwill of GBP0.25 million.
---------------------------------------------------------------------------------------
Buster + Punch Retailer March 2017 0.67*
------------------ ------------------ -------------------- -------------------------
Buster and Punch Holdings Limited (formerly Chatfield Services
Limited) is a London-based interiors brand founded in 2012 by
architect and industrial designer Massimo Buster Minale. Buster
+ Punch (www.busterandpunch.com) started in a small garage in
East London, where it built the "world's first designer LED light
bulb" (the Buster Bulb) and made its name with its industrial
inspired lighting. Its products are now sold in over 50 countries,
both directly and to end-consumers, designers and architects,
and through well-known retailers including John Lewis, Harvey
Nichols and Harrods. The investment will support the business's
international expansion plans and the broadening of its product
range. The company's latest accounts for the year ended 31 March
2017 show turnover of GBP3.43 million and profit before interest,
tax and amortisation of goodwill of GBP0.40 million.
---------------------------------------------------------------------------------------
* - GBP1.51 million held in Chatfield Services, a company preparing
to trade, was used for the investment into Buster and Punch,
after a net repayment to the company of GBP0.84 million. The
company subsequently changed its name to Buster and Punch Holdings
Limited.
---------------------------------------------------------------------------------------
MyTutorweb Online tutoring May 2017 0.55
------------------ ------------------ -------------------- -------------------------
MyTutorweb is a digital marketplace that connects school pupils
seeking private one-to-one tuition with university students.
The business is satisfying growing demand from both students
and parents to improve pupil's exam results and enhance their
academic and career prospects. This investment supports and opportunity
to consolidate the sizable GBP2 billion UK tutoring market, grow
MyTutorweb's market presence and drive technological development
within the company. The company's latest accounts for the year
ended 31 December 2016 show turnover of GBP0.21 million and a
loss before interest, tax and amortisation of goodwill of GBP0.94
million.
---------------------------------------------------------------------------------------
Wetsuit Outlet Retailer July 2017 2.74*
------------------ ------------------ -------------------- -------------------------
B2C Holdings Limited (trading as Wetsuit Outlet) has established
itself as a leading online retailer in the water sports market,
stocking an impressive brand portfolio including Musto, Billabong,
Rip Curl, O'Neill, Red Paddle (an existing Mobeus investment)
and Gul. The investment is to fund working capital and growth
in existing activities and enter two new markets. Established
in 2005, the company has developed into a successful and profitable
business achieving turnover of GBP11.51 million and a profit
before interest, tax and amortisation of goodwill of GBP1.98
million in the financial year ended 31 March 2017.
---------------------------------------------------------------------------------------
* - This investment utilised GBP2.09 million previously held
in Manufacturing Services Investment Limited, a company preparing
to trade, after a net repayment to the Company of GBP0.57 million.
A further GBP0.65 million was invested directly by the Company
into Wetsuit Outlet.
---------------------------------------------------------------------------------------
Further investments in existing portfolio companies
The Company made further investments of GBP0.16 million into BookingTek,
a provider of direct booking systems to major hotel groups, and
GBP0.29 million into Mpb, a leading online marketplace for used
camera and video equipment, during the year under review.
Company Business Date of investment Amount of new investment
(GBPm)
------------ ---------------------- -------------------- -------------------------
A provider of
direct booking
systems to major March and November
BookingTek hotel groups 2017 0.16
------------ ---------------------- -------------------- -------------------------
London-based BookingTek provides software that enables hotels
to reduce their reliance on third-party booking systems through
an enterprise-grade, real-time booking platform for meeting rooms
and restaurant reservations. BookingTek's existing clients include
two of the world's top 10 hotel groups and the UK's largest hotel
group. The company's accounts for the year ended 31 July 2016
show turnover of GBP2.03 million and a loss before interest, tax
and amortisation of goodwill of GBP0.29 million.
-------------------------------------------------------------------------------------
Online Marketplace
for used camera September and
MPB Group and video equipment December 2017 0.29
------------ ---------------------- -------------------- -------------------------
Mpb is Europe's leading online marketplace for used camera and
video equipment. Based in Brighton, its custom-designed pricing
technology enables Mpb to offer both buy and sell services through
the same platform and offers a one-stop shop for all its customers.
The investment is to fund expansion of its platform globally,
with launches into both the US and German markets. The company's
latest audited accounts for the year ended 31 March 2017 show
turnover of GBP13.20 million and a loss before interest, tax and
amortisation of goodwill of GBP0.45 million. A further GBP0.43
million was invested into Mpb on 27 February 2018 following the
year end.
-------------------------------------------------------------------------------------
New investment post year end
Following the year end, a new investment of GBP0.42 million was
made into Proactive Investors; a new investment of GBP0.58 million
was made into SuperCarers Limited; and a new investment of GBP0.60
million was made into Hemmels Limited, further details of which
are set out below:
Company Business Date of investment Amount of new investment
(GBPm)
--------------------- ------------------------- -------------------- ---------------------------
Investor media
Proactive Investors services January 2018 0.42
--------------------- ------------------------- -------------------- ---------------------------
Proactive Investors specialises in up-to-the-minute multi-media
news provision, events organisation, digital services and investor
research. Proactive provides breaking news, commentary and analysis
on hundreds of small-cap listed companies and pre-IPO businesses
across the globe, 24/7. The investment will enable Proactive to
expand its services into the US market, which is the largest global
market in the world. The company's accounts for the year ended
30 June 2017 show turnover of GBP3.99 million and a profit before
interest, tax and amortisation of goodwill of GBP0.53 million.
---------------------------------------------------------------------------------------------------
SuperCarers Online care provision March 2018 0.58
--------------------- ------------------------- -------------------- ---------------------------
SuperCarers provides an online platform connecting people seeking
home care, typically family members seeking care for their elderly
parents, from experienced independent carers. Carers and care-seekers
manage care directly, thus reducing the administrative burden
and the need for care managers, enabling care to be delivered
in a less rigid and formal fashion. The company's accounts for
the year ended 31 March 2017 generated revenues of GBP0.18 million
and a net loss before interest, tax and amortisation of GBP0.72
million.
---------------------------------------------------------------------------------------------------
Hemmels Limited Classic car restoration March 2018 0.60
--------------------- ------------------------- -------------------- ---------------------------
Hemmels specialises in the sourcing, restoration, selling and
servicing of high value classic cars. Hemmels currently focuses
on classic Mercedes Benz, but plan to expand into the Porsche
marque under a separate brand: RYKRR. The investment will enable
Hemmels to proceed with its expansion plans and secure sufficient
development stock. Hemmels generated GBP1.21 million of revenues
and a GBP0.28 million net loss before interest, tax and amortisation
for the year ended 31 December 2017.
---------------------------------------------------------------------------------------------------
Realisations during the year
The Company realised three investments during the year under review
for cash proceeds totalling GBP9.94 million as detailed below.
Including the loan stock repayments of GBP6.35 million, also listed
below, and other receipts of GBP0.90 million, total net cash proceeds
for the year amounted to GBP17.19 million.
Company Business Period of investment Total cash proceeds
over the life of
the investment/
Multiple over cost
------------------ --------------------------- --------------------- --------------------
Omega Diagnostics In-vitro diagnostics December 2010 GBP0.46 million
for food intolerance, to February 2017 1.5 times cost
autoimmune and infectious
diseases
------------------ --------------------------- --------------------- --------------------
The Company sold its investment in Omega Diagnostics plc, an AIM
quoted stock, over a phased period generating proceeds of GBP0.46
million (GBP0.37 million during the 2017 financial year). The
realisation generated a 1.50 multiple over cost over the lifetime
of the investment.
--------------------------------------------------------------------------------------------
Entanet Wholesale voice and February 2014 GBP6.92 million
data communications to August 2017 2.5 times cost
provider
------------------ --------------------------- --------------------- --------------------
The Company sold its investment in Entanet to AIM quoted CityFibre
Infrastructure Holdings Limited for GBP6.12 million in August
2017. Deferred contingent consideration of up to GBP0.63 million
is potentially payable over the next two years. Excluding this
deferred consideration, the Company has so far realised a gain
over the life of the investment of GBP4.21 million, a multiple
of 2.5 times cost and has returned an IRR of 39% to date.
--------------------------------------------------------------------------------------------
Gro-Group Manufacturer and March 2013 to GBP4.36 million
distributor of baby December 2017 2.2 times cost
sleep products
------------------ --------------------------- --------------------- --------------------
The Company sold its investment in Gro-Group for GBP3.45 million
in December 2017. Deferred consideration of up to GBP0.11 million
is potentially payable over the next year. Excluding this deferred
consideration, the Company has so far realised a gain over the
life of the investment of GBP2.38 million, a multiple of 2.2 times
cost and has returned an IRR of 21% to date.
--------------------------------------------------------------------------------------------
Mobeus Equity Partners LLP
Investment Adviser
Market Date of Total book Valuation Like for % value % of
sector investment cost like valuation of net equity
GBP'000 increase/ assets held
GBP'000 (decrease) by funds
over year advised
by Mobeus
Qualifying investments
------------------------------------- ------------- ----------- ---------- ---------------- -------- -----------
Unquoted investments
---------------------------------------------------- ----------- ---------- ---------------- -------- -----------
Tovey Management
Limited (trading
as Access IS)
Provider of
data capture Software
and scanning and computer
hardware services Oct-15 2,979 3,362 6.1% 4.8% 43.4%
-------------------
ASL Technology
Holdings Limited
Printer and
photocopier Support
services services Dec-10 2,942 3,119 (1.6)% 4.5% 47.5%
-------------------
Virgin Wines
Holding Company
Limited
Online Wine General
retailer retailers Nov-13 2,439 2,746 (19.1)% 3.9% 42.0%
-------------------
Manufacturing
Services
Investment
Limited (trading
as Wetsuit
Outlet)
Online retailer
in the water General
sports market retailers Jul-17 2,745 2,745 New investment 3.9% 27.5%
-------------------
Turner Topco
Limited (trading
as ATG Media)
Publisher and
on-line auction
platform operator Media Oct-08 2,501 2,115 (2.8)% 3.0% 17.1%
-------------------
Vian Marketing
Limited (trading
as Red Paddle
Co)
Design,
manufacture
and sale of
stand-up
paddleboards
and windsurfing Leisure
sails goods Jul-15 1,189 1,874 19.2% 2.7% 31.5%
-------------------
Tharstern Group
Limited
Software based
management Software
information and computer
systems services Jul-14 1,377 1,767 15.1% 2.5% 52.5%
-------------------
Fullfield Limited
(trading as
Motorclean)
Provider of
vehicle cleaning
and valet Support
services services Jul-11 1,626 1,703 (18.8)% 2.4% 46.0%
-------------------
Vectair Holdings
Limited
Designer and
distributor
of washroom Support
products services Jan-06 139 1,699 65.1% 2.4% 24.0%
-------------------
EOTH Limited
(trading as
Rab and Lowe
Alpine)
Branded outdoor
equipment and General
clothing retailers Oct-11 1,000 1,593 17.3% 2.3% 8.0%
-------------------
Master Removers
Group Limited
(trading as
Anthony Ward
Thomas,
Bishopsgate
and Aussie Man & Van) A specialist logistics, storage and Support removals business services Dec-14 614 1,409 59.8% 2.0% 18.4% ------------------- CGI Creative Graphics International Limited Vinyl graphics to global automotive, recreational vehicle and General aerospace markets Industrials Jun-14 1,808 1,356 (17.1)% 1.9% 28.1% ------------------- TPSFF Holdings Limited (formerly The Plastic Surgeon Holdings Limited) Supplier of snagging and finishing services to the domestic and commercial Support property markets services Apr-08 193 1,311 25.5% 1.9% 38.0% ------------------- Media Business Insight Holdings Limited A publishing and events business focused on the creative production industries Media Jan-15 2,518 1,241 (25.0)% 1.8% 67.5% ------------------- Preservica Limited Seller of proprietary Software digital archiving and computer software services Dec-15 900 1,230 36.7% 1.8% 37.9% ------------------- Redline Worldwide Limited Provider of security services to the aviation industry and Support other sectors services Feb-16 1,088 1,165 7.1% 1.7% 30.0% ------------------- Pattern Analytics Limited (trading as Biosite) Workforce management and security services for Software the construction and computer industry services Nov-16 757 1,136 50.0% 1.7% 20.5% ------------------- BookingTek Limited Direct booking Software software for and computer hotels services Oct-16 771 1,026 42.1% 1.6% 14.9% MPB Group Limited Online marketplace for used photographic and video General equipment retailers Jun-16 892 997 17.3% 1.4% 23.5% ------------------- RDL Corporation Limited Recruitment consultant for the pharmaceutical, business intelligence Support and IT industries services Oct-10 1,558 985 (31.7)% 1.4% 45.2% ------------------- Blaze Signs Holdings Limited Manufacturer and installer Support of signs services Apr-06 492 702 (31.0)% 1.0% 52.5% ------------------- Ibericos Etc. Limited (trading as Tapas Revolution) Spanish restaurant Travel chain and leisure Jan-17 692 692 New investment 1.0% 25.0% ------------------- Veritek Global Holdings Limited Maintenance of imaging Support equipment services Jul-13 2,045 692 (57.3)% 1.0% 50.8% ------------------- Buster and Punch Holdings Limited (formerly Chatfield Services Limited) Industrial inspired lighting and interiors General retailer retailers Mar-17 668 668 New investment 1.0% 20.0% ------------------- Hollydale Management Limited Company seeking to carry on a business Company in the food preparing sector to trade Mar-15 938 585 0.0% 0.8% 50.0% ------------------- My Tutorweb Limited Digital marketplace connecting school pupils seeking one-to-one Support tutoring services May-17 547 547 New investment 0.8% 19.3% ------------------- Jablite Holdings Limited Manufacturer of expanded polystyrene Construction products and materials Apr-15 502 306 (62.1)% 0.4% 40.1% ------------------- Backhouse Management Limited Company seeking to carry on a business Company in the motor preparing sector to trade Apr-15 787 303 0.0% 0.4% 50.0% ------------------- Barham Consulting Limited Company seeking to carry on a business Company in the catering preparing sector to trade Apr-15 787 303 0.0% 0.4% 50.0% ------------------- Creasy Marketing Services Limited Company seeking to carry on a business Company in the textile preparing sector to trade Apr-15 787 303 0.0% 0.4% 50.0% ------------------- McGrigor Management Limited Company seeking to carry on a business in the Company pharmaceutical preparing sector to trade Apr-15 787 303 0.0% 0.4% 50.0% ------------------- Lightworks Software Limited Provider of Software software for and computer CAD vendors services Apr-06 223 159 (3.0)% 0.2% 45.0% ------------------- CB Imports Group Limited (trading as Country Baskets) Importer and distributor of artificial flowers and General floral sundries. retailers Dec-09 350 - 0.0% 0.0% 23.2% ------------------- Newquay Helicopters (2013) Limited (in creditors' voluntary liquidation) Helicopter Support service operator services Jun-06 30 - 0.0% 0.0% 34.9% ------------------- Racoon International Group Limited Supplier of hair extensions, hair care products Personal and training goods Dec-06 1,213 - 0.0% 0.0% 36.0% ------------------- Watchgate Limited Support Holding company services Nov-11 1 - 0.0% 0.0% 100.0% ------------------- Total unquoted investments 40,885 40,142 57.4% Total qualifying investments 40,885 40,142 57.4% Non-qualifying investments ------------------------------------- ------------- ----------- ---------- ---------------- -------- ----------- Media Business Insight Limited Media Jan-15 764 764 1.1% ------------------- ---------------- ------------- ----------- ---------- ---------------- -------- ----------- EOTH Limited (Rab and Lowe General Alpine) retailers Oct-11 298 324 0.5% ------------------- ---------------- ------------- ----------- ---------- ---------------- -------- ----------- Tovey Management Software Limited (trading and computer as Access IS) services Oct-15 285 285 0.4% ------------------- ---------------- ------------- ----------- ---------- ---------------- -------- ----------- Total non-qualifying investments 1,347 1,373 2.0% ---------------------------------------------------- ----------- ---------- ---------------- -------- ----------- Total investment portfolio 42,232 41,515 59.4% ---------------------------------------------------- ----------- ---------- ---------------- -------- ----------- Current asset investments and cash at bank 24,832 24,832 35.5% ---------------------------------------------------- ----------- ---------- ---------------- -------- ----------- Total investments 67,064 66,347 94.9% ---------------------------------------------------- ----------- ---------- ---------------- -------- ----------- Other assets 3,976 5.7% ---------------------------------------------------- ----------- ---------- ---------------- -------- ----------- Current liabilities (423) (0.6)% ---------------------------------------------------- ----------- ---------- ---------------- -------- ----------- Net assets 69,900 100.0% ---------------------------------------------------- ----------- ---------- ---------------- -------- -----------
For further information on the Investment Portfolio, please see the Annual Report and Financial Statements
PRINCIPAL RISKS, management and regulatory environment
The Directors acknowledge the Board's responsibilities for the
Company's internal control systems and have instigated systems
and procedures for identifying, evaluating and managing the significant
risks faced by the Company. This includes a key risk management
review which takes place at each quarterly Board meeting. The
principal risks identified by the Board, a description of the
possible consequences of each risk and how the Board manages each
risk are set out below:
Risk Possible How the Board manages risk
consequence
------------- ----------------- -----------------------------------------------------------
Economic Events such as
the impact * The Board monitors (1) the portfolio as a whole to
of the EU ensure that the Company invests in a diversified
Referendum vote portfolio of companies; and (2) developments in the
and the macro-economic environment such as movements in
subsequent exit interest rates.
negotiations, an
economic
recession, a
movement in
sterling or in
interest
rates, could
affect trading
conditions for
smaller
companies and
consequently
the value of the
Company's
qualifying
investments.
------------- ----------------- -----------------------------------------------------------
Loss of A breach of the
approval VCT Rules, * The Company's VCT qualifying status is continually
as a Venture which change on reviewed by the Board and the Investment Adviser.
Capital a frequent
Trust basis, may lead
to the * The Board receives regular reports from its VCT
Company losing Status Adviser who has been retained by the Board to
its approval monitor the VCT's compliance with the VCT Rules.
as a VCT, which
would inter
alia result in:
(1) qualifying
shareholders who
have not
held their
shares for the
designated
period having
to repay the
income tax
relief they
obtained; (2)
future dividends
paid by
the Company
being subject
to tax; and (3)
the Company
losing its
exemption from
corporation tax
on capital
gains.
------------- ----------------- -----------------------------------------------------------
Investment Investment in
and unquoted * The Board regularly reviews the Company's Objective
strategic small companies and Investment Policy.
involves
a higher degree
of risk * Investments are made across a number of diverse
than investment sectors to mitigate risk. Investee companies are
in fully carefully selected by the Investment Adviser for
listed recommendation to the Board. The investment portfoli
companies. o
Smaller is reviewed by the Board on a regular basis.
companies often
have limited
product lines,
markets
or financial
resources
and may be
dependent for
their management
on a smaller
number of key
individuals.
------------- ----------------- -----------------------------------------------------------
Regulatory The Company is
required * Regulatory and legislative developments are kept
to meet its under review by the Company's solicitors, its VCT
legal and Status Adviser and the Board. Please see the
regulatory Chairman's Statement for the latest details of the
obligations as a impact of recent VCT legislation.
VCT, a
listed company
and its
own AIFM.
Failure to
comply
might result in
suspension
of the Company's
Stock
Exchange
listing,
financial
penalties, a
qualified
audit report or
loss of
its VCT status.
------------- ----------------- -----------------------------------------------------------
Financial Failure of the
and systems * The Board carries out an annual review of the
operating at any of the internal controls in place and reviews the risks
third party facing the Company at each quarterly Board meeting
service and receives reports by exception.
providers that
the Company has
contracted * It reviews the performance of the service providers
with could lead annually.
to inaccurate
reporting or
monitoring.
Inadequate
controls could
lead to the
misappropriation
or insecurity of
assets.
------------- ----------------- -----------------------------------------------------------
Market Movements in the
valuations * The Board receives quarterly valuation reports from
of the VCT's the Investment Adviser.
investments
will, inter
alia, be * The Investment Adviser alerts the Board about any
connected adverse movements.
to movements in
UK Stock
Market indices.
------------- ----------------- -----------------------------------------------------------
Asset The Company's
liquidity unquoted * The Board receives reports from the Investment
investments Adviser and reviews the portfolio at each quarterly
cannot be board meeting. It carefully monitors investments
realised where a particular risk has been identified.
in a short
timescale.
Under-performing
unquoted
investments may
be difficult to
realise
on any
timescale.
------------- ----------------- -----------------------------------------------------------
Market As a result of
liquidity the limited * The Board has a share buyback policy which seeks to
secondary market mitigate market liquidity risk. This policy is
in VCT reviewed at each quarterly Board meeting.
shares,
shareholders may
find it
difficult to
sell
their shares at
a price
which is close
to the net
asset value.
Whilst demand
has always been
met to
date, it may not
be possible
for the Company
to buy
back large
percentages
of the share
capital, other
than over
several years.
------------- ----------------- -----------------------------------------------------------
Counterparty A counterparty
may fail * The Board regularly reviews and agrees policies for
to discharge an managing these risks. Further details can be found
obligation under 'credit risk' in Note 15 to the Financial
or commitment Statements in the Annual Report.
that it has
entered into
with the
Company.
------------- ----------------- -----------------------------------------------------------
Key staff A partner or key
member * The Board maintains regular dialogue with the
of staff at the Investment Adviser to ensure that (1) the team is
Investment adequately resourced; and (2) Partners and staff are
Adviser may well-incentivised and trained.
leave the
organisation
or the
Investment
Adviser
may fail to
maintain
adequate
levels of
experience and
expertise in its
team.
This may have an
adverse
effect on the
standard
of service that
the Company
receives from
the Investment
Adviser and
therefore the
performance of
the Company.
------------- ----------------- -----------------------------------------------------------
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Annual Report
and the Financial Statements in accordance with applicable law
and regulations.
Company law requires the Directors to prepare Financial Statements
for each financial year and the Directors have elected to prepare
the Financial Statements in accordance with United Kingdom Generally
Accepted Accounting Practice (United Kingdom Accounting Standards
and applicable law). Under company law the Directors must not
approve the Financial Statements unless they are satisfied that
they give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for that period.
In preparing these Financial Statements, the Directors are required
to:
* select suitable accounting policies and then apply
them consistently;
* make judgements and accounting estimates that are
reasonable and prudent;
* state whether the Financial Statements have been
prepared in accordance with United Kingdom accounting
standards, subject to any material departures
disclosed and explained in the Financial Statements;
* prepare the Financial Statements on the going concern
basis unless it is inappropriate to presume that the
Company will continue in business;
* prepare a Strategic Report, a Director's Report and
Directors' Remuneration Report which comply with the
requirements of the Companies Act 2006.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time
the financial position of the Company and enable them to ensure
that the Financial Statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the Company
and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
Website publication
The Directors are responsible for ensuring the Annual Report and
the Financial Statements are made available on a website. Financial
Statements are published on the Company's website in accordance
with legislation in the United Kingdom governing the preparation
and dissemination of Financial Statements, which may vary from
legislation in other jurisdictions. The maintenance and integrity
of the Company's website is the responsibility of the Directors.
The Directors' responsibility also extends to the ongoing integrity
of the Financial Statements contained therein.
Directors' responsibilities pursuant to Disclosure and Transparency
Rule 4 of the UK Listing Authority
The Directors confirm to the best of their knowledge that:
(a) The Financial Statements, which have been prepared in accordance
with United Kingdom Generally Accepted Accounting Practice give
a true and fair view of the assets, liabilities, financial position
and the profit of the Company.
(b)
The Annual Report includes a fair review of the development and
performance of the business and the position of the Company, together
with a description of the principal risks and uncertainties that
it faces.
Having taken advice from the Audit Committee, the Board considers
the Annual Report and Accounts, taken as a whole, is fair, balanced
and understandable and that it provides the information necessary
for shareholders to assess the Company's performance, business
model and strategy.
Neither the Company nor the Directors accept any liability to
any person in relation to the Annual Report except to the extent
that such liability could arise under English law.
For and on behalf of the Board
Clive Boothman
Chairman
FINANCIAL STATEMENTS
Income Statement for the year ended 31 December 2017
Year ended 31 December Year ended 31 December
2017 2016
Notes Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
Unrealised
losses on
investments 8 - (572,662) (572,662) - (196,760) (196,760)
Realised
gains on
investments 8 - 5,248,859 5,248,859 - 628,948 628,948
Income 3 3,131,481 - 3,131,481 2,650,934 - 2,650,934
Investment
Adviser's
fees 4a (350,079) (1,050,237) (1,400,316) (383,672) (1,151,015) (1,534,687)
Other expenses 4c (385,417) - (385,417) (349,892) - (349,892)
Profit/(loss)
on ordinary
activities
before taxation 2,395,985 3,625,960 6,021,945 1,917,370 (718,827) 1,198,543
Taxation
on profit/(loss)
on ordinary
activities 5 (392,180) 202,170 (190,010) (339,532) 230,203 (109,329)
Profit/(loss) for
the year and total
comprehensive income 2,003,805 3,828,130 5,831,935 1,577,838 (488,624) 1,089,214
Basic and
diluted earnings
per ordinary
share 7 2.52p 4.82p 7.34p 2.08p (0.64)p 1.44p
The revenue column of the Income Statement includes all income
and expenses. The capital column accounts for the unrealised (losses)/gains
and realised gains on investments and the proportion of the Investment
Adviser's fee charged to capital.
The total column is the Statement of Total Comprehensive Income
of the Company prepared in accordance with Financial Reporting
Standards ("FRS"). In order to reflect better the activities of
a VCT and in accordance with the 2014 Statement of Recommended
Practice ("SORP") (updated in January 2017) by the Association
of Investment Companies ("AIC"), supplementary information which
analyses the Income Statement between items of a revenue and capital
nature has been presented alongside the Income Statement. The revenue
column of profit attributable to equity shareholders is the measure
the Directors believe appropriate in assessing the Company's compliance
with certain requirements set out in Section 274 Income Tax Act
2007.
All the items in the above statement derive from continuing operations
of the Company. No operations were acquired or discontinued in
the year.
Balance Sheet as at 31 December
2017
31 December 31 December
2017 2016
Notes GBP GBP
Fixed assets
Investments at fair value 8 41,515,308 51,682,768
Current assets
Debtors and prepayments 3,976,235 1,154,144
Current asset investments 9 21,803,276 5,246,949
Cash at bank and in hand 9 3,027,719 5,314,539
--------------------------------------- ------ ------------ ------------
28,807,230 11,715,632
Creditors: amounts falling due within
one year (422,761) (248,847)
--------------------------------------- ------ ------------ ------------
Net current assets 28,384,469 11,466,785
--------------------------------------- ------ ------------ ------------
Net assets 69,899,777 63,149,553
--------------------------------------- ------ ------------ ------------
Capital and reserves
Called up share capital 974,257 755,975
Capital redemption reserve 15,040 9,440
Share premium reserve 35,856,430 19,463,849
Revaluation reserve 2,786,782 3,523,180
Special distributable reserve 19,058,094 35,605,335
Realised capital reserve 8,147,387 2,733,792
Revenue reserve 3,061,787 1,057,982
--------------------------------------- ------ ------------ ------------
Equity shareholders' funds 69,899,777 63,149,553
--------------------------------------- ------ ------------ ------------
Basic and diluted net asset value
per ordinary share 71.75p 83.53p
--------------------------------------- ------ ------------ ------------
Statement of Changes in Equity for the year ended 31 December 2017
Non-distributable reserves Distributable reserves
Notes Called Capital Share Revaluation Special Realised Revenue Total
up redemption premium reserve distributable capital reserve
share reserve reserve reserve reserve
capital
(Note (Note (Note
a) b) b)
GBP GBP GBP GBP GBP GBP GBP GBP
At 1 January
2017 755,975 9,440 19,463,849 3,523,180 35,605,335 2,733,792 1,057,982 63,149,553
Comprehensive
income
for the
year
(Loss)/profit
for the
year - - - (572,662) - 4,400,792 2,003,805 5,831,935
--------------- ------ -------- ----------- ------------- ------------ --------------- ---------- ---------- -------------
Total
comprehensive
income
for the
year - - - (572,662) - 4,400,792 2,003,805 5,831,935
--------------- ------ -------- ----------- ------------- ------------ --------------- ---------- ---------- -------------
Contributions
by and
distributions
to owners
Shares
issued
under Offer
for
Subscription
(note c) 223,882 - 16,392,581 - (91,557) - - 16,524,906
Shares
bought
back (note
d) (5,600) 5,600 - - (374,695) - - (374,695)
Dividends
paid 6 - - - - (15,231,922) - - (15,231,922)
--------------- ------ -------- ----------- ------------- ------------ --------------- ---------- ---------- -------------
Total
contributions
by and
distributions
to owners 218,282 5,600 16,392,581 - (15,698,174) - - 918,289
Other
movements
Realised
losses
transferred
to special
reserve
(note a) - - - - (849,067) 849,067 - -
Realisation
of previously
unrealised
appreciation - - - (163,736) - 163,736 - -
Total other
movements - - - (163,736) (849,067) 1,012,803 - -
At 31 December
2017 974,257 15,040 35,856,430 2,786,782 19,058,094 8,147,387 3,061,787 69,899,777
--------------- ------ -------- ----------- ------------- ------------ --------------- ---------- ---------- -------------
Note a: The purpose of this reserve is to fund market purchases of
the Company's own shares, to write off existing and future losses and
for any other corporate purpose. All of this reserve arose from shares
issued before 5 April 2014. The transfer of GBP849,067 to the special
reserve from the realised capital reserve above is the total of realised
losses incurred by the Company in the year.
Note b: The realised capital reserve and the revenue reserve together
comprise the Profit and Loss Account of the Company shown on the Balance
Sheet.
Note c: Under the Offer for Subscription launched on 6 September 2017,
22,388,196 ordinary shares were allotted raising net funds of GBP16,524,906
for the Company.
Note d: During the year, the Company purchased 559,948 of its
own shares at the prevailing market price for a total cost of
GBP374,695, which were subsequently cancelled. This differs
to the figure shown in the Statement of Cashflows by GBP46,857.
This amount was included in creditors at the year end.
.
Statement of Changes in Equity for the year ended 31 December 2016
Non-distributable reserves Distributable reserves
Called Capital Share Revaluation Special Realised Revenue Total
up redemption premium reserve distributable capital reserve
share reserve reserve reserve reserve
capital
GBP GBP GBP GBP GBP GBP GBP GBP
--------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ -------------
At 1 January
2016 759,730 5,685 19,463,849 3,785,072 40,625,822 7,716,009 1,749,683 74,105,850
Comprehensive
income for
the year
(Loss)/profit
for the year - - - (196,760) - (291,864) 1,577,838 1,089,214
--------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ -------------
Total
comprehensive
income for
the year - - - (196,760) - (291,864) 1,577,838 1,089,214
--------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ -------------
Contributions
by and
distributions
to owners
Shares bought
back (3,755) 3,755 - - (318,277) - - (318,277)
Dividends
paid - - - - (3,781,398) (5,676,297) (2,269,539) (11,727,234)
Total
contributions
by and
distributions
to owners (3,755) 3,755 - - (4,099,675) (5,676,297) (2,269,539) (12,045,511)
--------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ -------------
Other
movements
Realised
losses
transferred
to special
reserve - - - - (920,812) 920,812 - -
Realisation
of previously
unrealised
appreciation - - - (65,132) - 65,132 - -
--------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ -------------
Total other
movements - - - (65,132) (920,812) 985,944 - -
At 31 December
2016 755,975 9,440 19,463,849 3,523,180 35,605,335 2,733,792 1,057,982 63,149,553
--------------- -------- ----------- ----------- ------------ -------------- ------------ ------------ -------------
The composition of each of these reserves
is explained below:
Called up share
capital
The nominal value of shares originally issued, increased for subsequent
share issues either via an Offer for Subscription or reduced due
to shares bought back by the Company.
Capital redemption
reserve
The nominal value of shares bought back and cancelled is held
in this reserve, so that the company's capital is maintained.
Share premium reserve
This reserve contains the excess of gross proceeds less issue
costs over the nominal value of shares allotted under recent Offers
for Subscription.
Revaluation reserve
Increases and decreases in the valuation of investments held at
the year-end are accounted for in this reserve, except to the
extent that the diminution is deemed permanent.
In accordance with stating all investments at fair value through
profit and loss (as recorded in note 8), all such movements through
both revaluation and realised capital reserves are shown within
the Income Statement for the year.
Special distributable reserve
The cost of share buybacks is charged to this reserve. In addition,
any realised losses on the sale or impairment of investments (excluding
transaction costs), and 75% of the Investment Adviser fee expense,
and the related tax effect, are transferred from the realised
capital reserve to this reserve. This reserve will also be charged
any facilitation payments to financial advisers, which arose as
part of the Offer for Subscription.
Realised capital
reserve
The following are accounted for in this reserve:
-- Gains and losses on realisation of investments;
-- Permanent diminution in value of investments;
-- Transaction costs incurred in the acquisition and disposal
of investments;
-- 75% of the Investment Adviser fee expense and 100% of any performance
fee payable, together with the related tax effect to this reserve
in accordance with the policies; and
-- Capital dividends paid.
Revenue reserve
Income and expenses that are revenue in nature are accounted for
in this reserve together with the related tax effect, as well
as income dividends paid that are classified as revenue in nature.
Statement of Cash Flows for the year ended 31 December 2017
Notes Year ended Year ended
31 December 31 December
2017 2016
------
GBP GBP
------------------------------------------------- ------ ------------- -------------
Cash flows from operating activities
Profit after tax for the financial year 5,831,935 1,089,214
Adjustments for:
Net unrealised losses on investments 572,662 196,760
Net gains on realisations of investments (5,248,859) (628,948)
Tax charge for current year 190,010 109,329
Increase in debtors (197,500) (38,554)
Increase/(decrease) in creditors 92,991 (82,593)
------------------------------------------------- ------ ------------- -------------
Net cash inflow from operations 1,241,239 645,208
Corporation tax paid (109,090) (44,108)
Net cash inflow from operating activities 1,132,149 601,100
Cash flows from investing activities
Acquisitions of investments 8 (1,649,533) (3,559,180)
Disposals of investments 8 13,821,745 3,397,012
Decrease in bank deposits with a maturity
over three months 1,715 2,003,484
------------------------------------------------- ------ ------------- -------------
Net cash inflow from investing activities 12,173,927 1,841,316
Cash flows from financing activities
Shares issued as part of Offer for subscription 16,524,906 -
Equity dividends paid 6 (15,231,922) (11,727,234)
Share capital bought back (327,838) (318,277)
------------------------------------------------- ------ -------------
Net cash inflow/(outflow) from financing
activities 965,146 (12,045,511)
Net increase/(decrease) in cash and
cash equivalents 14,271,222 (9,603,095)
Cash and cash equivalents at start of
year 9,554,221 19,157,316
------------------------------------------------- ------ ------------- -------------
Cash and cash equivalents at end of
year 23,825,443 9,554,221
Cash and cash equivalents comprise:
Cash equivalents 9 20,797,724 4,239,682
Cash at bank and in hand 9 3,027,719 5,314,539
Notes to the Financial Statements for the year ended 31 December 2017
1 Company Information
Mobeus Income and Growth VCT plc is a public limited company
incorporated in England, registration number 5153931. The registered
office is 30 Haymarket, London, SW1Y 4EX.
2 Basis of preparation of the Financial Statements
A summary of the principal accounting policies, all of which
have been applied consistently throughout the year are set
out at the start of the related disclosure throughout the Notes
to the Financial Statements. All accounting policies are included
within an outlined box at the top of each relevant note.
These financial statements have been prepared in accordance
with applicable United Kingdom accounting standards, including
Financial Reporting Standard 102 ("FRS102"), with the Companies
Act 2006 and the 2014 Statement of Recommended practice, 'Financial
Statements of Investment Trust Companies and Venture Capital
Trusts' ('the SORP') issued by the Association of Investment
Companies. The Company has a number of financial instruments
which are disclosed under FRS102 s11/12 as shown in Note 15
of the Annual Report
3 Income
Dividends receivable on unquoted equity shares are brought
into account when the Company's right to receive payment is
established and there is no reasonable doubt that payment will
be received. Dividends receivable on quoted equity shares are
brought into account on the ex-dividend date.
Interest income on loan stock is accrued on a daily basis.
Provision is made against this income where recovery is doubtful
or where it will not be received in the foreseeable future.
Where the loan stocks only require interest or a redemption
premium to be paid on redemption, the interest and redemption
premium is recognised as income or capital as appropriate once
redemption is reasonably certain. When a redemption premium
is designed to protect the value of the instrument holder's
investment rather than reflect a commercial rate of revenue
return the redemption premium is recognised as capital. The
treatment of redemption premiums is analysed to consider if
they are revenue or capital in nature on a company by company
basis. Accordingly, the redemption premium recognised in the
year ended 31 December 2017 has been classified as capital
and has been included within gains on investments.
------------------------------------------------------------------
2017 2016
GBP GBP
Income from bank deposits 17,793 60,115
---------------------------------------------------------------- ---------- ----------
Income from investments
* from equities 358,684 220,910
* from overseas based OEICs 23,657 31,429
* from loan stock 2,723,814 2,338,480
337 -
* from interest on preference share dividend arrears
---------------------------------------------------------------- ---------- ----------
3,106,492 2,590,819
Other income 7,196 -
---------------------------------------------------------------- ---------- ----------
Total income 3,131,481 2,650,934
Total income comprises
Dividends 382,341 252,339
Interest 2,741,944 2,398,595
Other income 7,196 -
---------------------------------------------------------------- ---------- ----------
3,131,481 2,650,934
---------------------------------------------------------------- ---------- ----------
Total loan stock interest due but not recognised in the year was GBP389,352 (2016: GBP602,221).
4 Investment adviser's fees and Other expenses
All expenses are accounted for on an accruals basis
----------------------------------------------------
a) Investment adviser's fees and performance fees
25% of the Investment Adviser's fees are charged to the revenue
column of the Income Statement, while 75% is charged against
the capital column of the Income Statement. This is in line
with the Board's expected long-term split of returns from the
investment portfolio of the Company.
100% of any performance incentive fee payable for the year
is charged against the capital column of the Income Statement,
as it is based upon the achievement of capital growth.
----------------------------------------------------------------
Revenue Capital Total Revenue Capital Total
2017 2017 2017 2016 2016 2016
GBP GBP GBP GBP GBP GBP
Mobeus Equity
Partners LLP
Investment Adviser's
fees 350,079 1,050,237 1,400,316 383,672 1,151,015 1,534,687
350,079 1,050,237 1,400,316 383,672 1,151,015 1,534,687
======== ========== ========== ======== ========== ==========
Under the terms of a revised investment management agreement
dated 20 May 2010, Mobeus Equity Partners LLP ("Mobeus") provides
investment advisory, administrative and company secretarial services
to the Company, for a fee of 2% per annum of closing net assets,
paid in advance, calculated on a quarterly basis by reference
to the net assets at the end of the preceding quarter, plus a
fixed fee of GBP134,168 per annum, the latter inclusive of VAT
and subject to annual increases in RPI. In 2013, Mobeus agreed
to waive such further increases due to indexation, until otherwise
agreed with the Board.
The Investment Adviser's fee includes provision for a cap on
expenses excluding irrecoverable VAT and exceptional items set
at 3.6% of closing net assets at the year-end. In accordance
with the Investment Management Agreement, any excess expenses
are borne by the Investment Adviser. The excess expenses during
the year amounted to GBPnil (2016: GBPnil).
The Company is responsible for external costs such as legal and
accounting fees, incurred on transactions that do not proceed
to completion ("abort expenses") subject to the cap on total
annual expenses referred to above.
In line with common practice, Mobeus retains the right to charge
arrangement and syndication fees and directors' or monitoring
fees to companies in which the Company invests. The Investment
Adviser received fees totalling GBP377,188 during the year ended
31 December 2017 (2016: GBP326,660), being GBP118,381 (2016:
GBP98,881) for arrangement fees and GBP258,807 (2016: GBP227,779)
for acting as non-executive directors on a number of investee
company boards. These fees attributable to MIG VCT are based
upon the investment allocation applicable to MIG VCT which applied
at the time of each investment. These figures are not part of
these financial statements.
Incentive agreement
Under the Incentive Agreement dated 9 July 2004, and a variation
of this agreement dated 20 May 2010, the Investment Adviser is
entitled to receive an annual performance-related incentive fee
of 20% of the dividends paid in a year in excess of a "Target
Rate" comprising firstly, an annual dividend paid in a year target
which started at 6.00 pence per share on launch (indexed each
year for RPI) and secondly a requirement that any shortfall of
cumulative dividends paid in each year beneath the cumulative
annual dividend target is carried forward and added to the Target
Rate for the next accounting period. Any excess of cumulative
dividends paid above the cumulative annual dividend target is
not carried forward, whether an incentive fee is payable for
that year or not. Payment of a fee is also conditional upon the
daily weighted average Net Asset Value ("NAV") per share throughout
such year equalling or exceeding the daily weighted average Base
NAV per share throughout the same year. The performance fee will
be payable annually.
At 31 December 2017, the annual dividend target is 7.63 pence
per share and there was an excess of cumulative dividends paid
over the cumulative annual dividend target of 11.37 pence per
share. However, the average NAV per share is 78.75 pence for
the year, which was less than the average base NAV per share
for the year of 97.61 pence. Accordingly, no performance incentive
fee is payable for the year and the excess of cumulative dividends
paid over the cumulative annual dividend target of 11.37 pence
will not be carried forward.
b) Offer for subscription fees
2017 2016
GBPm GBPm
Funds raised across the four Mobeus VCTs 60.36 -
of which the funds raised by MIG VCT were 16.90 -
Offer costs payable to Mobeus at 3.25%
of funds raised by MIG VCT 0.55 -
------------------------------------------ ------ -----
Under the terms of an Offer for Subscription, with the other
Mobeus advised VCTs, launched on 6 September 2017, Mobeus is
entitled to fees of 3.25% of the investment amount received
from investors. This amount totalled GBP1,961,764 for the first
five allotments during the year across all four VCTs, out of
which all the costs associated with the allotment were met,
excluding any payments to advisers facilitated under the terms
of the Offer.
c) Other expenses
Expenses are charged wholly to revenue, with the exception
of expenses incidental to the acquisition or disposal of an
investment, which are written off to the capital column of
the Income Statement or deducted from the disposal proceeds
as appropriate.
-------------------------------------------------------------
2017 2016
GBP GBP
Directors' remuneration (including NIC of
GBP8,110 (2016: GBP8,755)) - note a) 113,110 132,780
IFA trail commission 87,580 53,684
Broker's fees 14,400 14,400
Auditor's fees - Audit of Company (excluding
VAT) 23,832 23,575
- Audit related assurance services - note
b) (excluding VAT) 4,562 4,203
- tax compliance services - note b) (excluding
VAT) 1,358 3,393
Registrar's fees 48,045 33,121
Printing 27,299 20,495
Legal & professional fees 7,918 8,544
VCT monitoring fees 9,000 9,000
Directors' insurance 8,153 8,349
Listing and regulatory fees 30,114 29,176
Sundry 10,046 9,172
------------------------------------------------------------------ -------- --------
Other expenses 385,417 349,892
------------------------------------------------------------------ -------- --------
Note a): See analysis in the Directors' Remuneration Report
on page 31 of the Annual Report, which excludes the NIC above.
The key management personnel are the three non-executive Directors.
The Company has no employees.
Note b): The Directors consider the Auditor was best placed
to provide the other services disclosed above. The audit related
assurance services are in relation to the audit of the Financial
Statements within the Company's half year report. The Audit
Committee reviews the nature and extent of these services to
ensure that auditor independence is maintained. In this regard,
compliance tax services (excluding iXBRL services), with effect
from the current year, are to be carried out by another firm,
so are included within legal and professional fees.
5 Taxation on profit/(loss) on ordinary activities
The tax expense for the year comprises current tax and is recognised
in profit or loss. The current income tax charge is calculated
on the basis of tax rates and laws that have been enacted or
substantively enacted by the reporting date.
Any tax relief obtained in respect of adviser fees allocated
to capital is reflected in the realised capital reserve and
a corresponding amount is charged against revenue. The tax
relief is the amount by which corporation tax payable is reduced
as a result of these capital expenses.
Deferred tax is recognised in respect of all timing differences
that have originated but not reversed at the balance sheet
date where transactions or events that result in an obligation
to pay more tax in the future or a right to pay less tax in
the future have occurred at the balance sheet date. Timing
differences are differences between the Company's taxable profits
and its results as stated in the Financial Statements that
arise from the inclusion of gains and losses in the tax assessments
in periods different from those in which they are recognised
in the Financial Statements.
Deferred tax is measured at the average tax rates that are
expected to apply in the years in which the timing differences
are expected to reverse based on tax rates and laws that have
been enacted or substantively enacted at the balance sheet
date. Deferred tax is measured on a non-discounted basis.
A deferred tax asset would be recognised only to the extent
that it is more likely than not that future taxable profits
will be available against which the asset can be utilised.
---------------------------------------------------------------------
Tax relief relating to Investment Adviser fees is allocated
between revenue and capital where such relief can be utilised.
The Company is an Investment Trust and Investment Trust companies
are exempt from tax on capital gains if they meet the HMRC criteria
set out in section 274 of the ITA.
2017 2017 2017 2016 2016 2016
Revenue Capital Total Revenue Capital Total
GBP GBP GBP GBP GBP GBP
a) Analysis of tax charge:
UK Corporation tax on profits/(losses)
for the year 392,180 (202,170) 190,010 339,532 (230,203) 109,329
---------------------------------------- ---------- ------------ ------------ ---------- ---------- ----------
Total current tax charge/(credit) 392,180 (202,170) 190,010 339,532 (230,203) 109,329
---------------------------------------- ---------- ------------ ------------ ---------- ---------- ----------
Corporation tax is based
on a rate of 19.25% (2016:
20%)
b) Profit/(loss) on ordinary
activities before tax 2,395,985 3,625,960 6,021,945 1,917,370 (718,827) 1,198,543
Profit/(loss) on ordinary
activities multiplied by
main company rate of corporation
tax in the UK of 19.25%
(2016: 20.0%) 461,227 697,997 1,159,224 383,474 (143,765) 239,709
Effect of:
UK dividends (69,047) - (69,047) (44,182) - (44,182)
Unrealised losses not taxable - 110,237 110,237 - 39,352 39,352
Realised gains not taxable - (1,010,404) (1,010,404) - (125,790) (125,790)
Underprovision in prior
period - - - 240 - 240
Actual current tax charge 392,180 (202,170) 190,010 339,532 (230,203) 109,329
---------------------------------------- ---------- ------------ ------------ ---------- ---------- ----------
Deferred taxation
No provision for deferred taxation has been made on potential capital
gains due to the Company's current status as a VCT under section
274 of the ITA and the Directors' intention to maintain that status.
6 Dividends paid and payable
Dividends payable are recognised as distributions in the Financial
Statements when the Company's liability to pay them has been established.
This liability is established for interim dividends when they
are paid, and for final dividends when they are approved by the
shareholders, usually at the Company's Annual General Meeting.
A key judgement in applying the above accounting policy is in
determining the amount of minimum dividend to be paid in respect
of a year. The Company's status as a VCT means it has to comply
with Section 259 of the ITA, which requires that no more than
15% of the income from shares and securities in a year can be
retained from the revenue available for distribution for the year.
---------------------------------------------------------------------------
Amounts recognised as distributions to equity
shareholders in the year:
Dividend Type For year Pence Date Paid 2017 GBP 2016 GBP
ended 31 per
December share
Final Income 2015 1.00p 31/05/2016 - 756,980
Final Capital 2015 6.00p 31/05/2016 - 4,541,877
Interim Income 2016 2.00p 20/09/2016 - 1,512,559
Interim Capital 2016 1.50p 20/09/2016 - 1,134,420
Interim Capital 2016 5.00p 20/09/2016 - 3,781,398
Second Interim Capital 2016 6.00p* 31/03/2017 4,535,848 -
Interim Capital 2017 9.00p* 13/09/2017 6,796,071 -
Second Interim Capital 2017 4.00p* 08/12/2017 3,900,003 -
-----------
15,231,922 11,727,234
-------------------------------------- ------- ----------- ----------- -----------
Proposed distributions to equity holders
at the year-end:
Date Payable
Second interim Capital 2016 6.00p 31/03/2017 - 4,535,848
Final Income 2017 1.50p 17/05/2018 1,628,715 -
Final Capital 2017 1.00p* 17/05/2018 1,085,810 -
Final Capital 2017 0.50p 17/05/2018 542,905 -
---------------- --------- ------ ------- ------------- ---------- ----------
3,257,430 4,535,848
--------------------------------- ------- ------------- ---------- ----------
*These dividends were and will be paid out of the Company's special distributable reserve.
Set out below are the total income dividends payable in respect
of the financial year, which is the basis on which the requirements
of Section 259 of the ITA concerning the Company not retaining
more than 15% of its income from shares and securities, is considered.
Recognised income distributions in the financial
statements for the year
Dividend Type For year ended Pence Date paid/payable 2017 2016 GBP
31 December per share GBP
Revenue available for distribution by way of
dividends for the year 2,003,805 1,577,838
----------------------------------------------------------------------- ---------- ----------
Interim Income 2016 2.00p 20/09/2016 - 1,512,559
Final Income 2017 1.50p 17/05/2018 1,628,715 -
Total income dividends for the year 1,628,715 1,512,559
--------------------------------------------------- ------------------ ---------- ----------
Notes
a) Basic earnings per share is total earnings after taxation divided
by the weighted average number of shares in issue.
b) Revenue earnings per share is the revenue earnings after taxation
divided by the weighted average number of shares in issue.
c) Capital earnings per share is the total capital earnings after
taxation divided by the weighted average number of shares in issue.
d) There are no instruments that will increase the number of shares
in issue in future. Accordingly, the above figures currently represent
both basic and diluted earnings per share.
7 Basic and diluted earnings per share
2017 2016
GBP GBP
Total earnings after taxation: 5,831,935 1,089,214
Basic and diluted earnings per share
(note a) 7.34p 1.44p
---------------------------------------------- ----------- -----------
Revenue earnings from ordinary activities
after taxation 2,003,805 1,577,838
Basic and diluted revenue earnings per
share (note b) 2.52p 2.08p
---------------------------------------------- ----------- -----------
Net unrealised capital losses on investments (572,662) (196,760)
Net realised capital gains on investments 5,248,859 628,948
Capital Investment Adviser fees less
taxation (848,067) (920,812)
---------------------------------------------- ----------- -----------
Total capital earnings 3,828,130 (488,624)
---------------------------------------------- ----------- -----------
Basic and diluted capital earnings per
share (note c) 4.82p (0.64)p
---------------------------------------------- ----------- -----------
Weighted average number of shares in
issue in the year 79,475,780 75,741,214
8 Investments at fair value
The most critical estimates, assumptions and judgements relate to
the determination of the carrying value of investments at "fair value
through profit and loss" (FVTPL). All investments held by the Company
are classified as FVTPL and measured in accordance with the International
Private Equity and Venture Capital Valuation ("IPEV") guidelines,
as updated in December 2015. This classification is followed as the
Company's business is to invest in financial assets with a view to
profiting from their total return in the form of capital growth and
income.
Purchases and sales of unlisted investments are recognised when the
contract for acquisition or sale becomes unconditional. For investments
actively traded on organised financial markets, fair value is generally
determined by reference to Stock Exchange market quoted bid prices
at the close of business on the balance sheet date. Purchases and
sales of quoted investments are recognised on the trade date where
a contract of sale exists whose terms require delivery within a time
frame determined by the relevant market. Where the terms of a disposal
state that consideration may be received at some future date and,
subject to the conditionality and materiality of the amount of deferred
consideration, an estimate of the fair value, discounted for the
time value of money, may be recognised through the Income Statement.
In other cases, the proceeds will only be recognized once the right
to receive payment is established and there is no reasonable doubt
that payment will be received.
Unquoted investments are stated at fair value by the Directors in
accordance with the following policies, which are consistent with
the IPEV guidelines:
All investments are held at the price of a recent investment for
an appropriate period where there is considered to have been no change
in fair value. Where such a basis is no longer considered appropriate,
each investment is considered as a whole on a 'unit of account' basis,
alongside consideration of:
(i) Where a value is indicated by a material arms-length transaction
by an independent third party in the shares of a company, this value
will be used.
(ii) In the absence of i) and depending upon both the subsequent
trading performance and investment structure of an investee company,
the valuation basis will usually move to either:-
- a multiple basis. The investments may be valued by applying a suitable price-earnings ratio, revenue or gross profit multiple to that company's historic, current or forecast post-tax earnings before interest and amortisation, or revenue, or gross profit (the ratio used being based on a comparable sector but the resulting value being adjusted to reflect points of difference identified by the Investment Adviser compared to the sector including, inter alia, a lack of marketability). or:- - where a company's underperformance against plan indicates a diminution in the value of the investment, provision against cost is made, as appropriate. (iii) Premiums, to the extent that they are considered capital in nature, and that they will be received upon repayment of loan stock investments are accrued at fair value when the Company receives the right to the premium and when considered recoverable. (iv) Where a multiple or cost less impairment basis is not appropriate and overriding factors apply, a discounted cash flow, net asset valuation or realisation proceeds basis may be applied. Capital gains and losses on investments, whether realised or unrealised, are dealt with in the profit and loss and revaluation reserves and movements in the period are shown in the Income Statement. All investments are initially recognised and subsequently measured at fair value. Changes in fair value are recognised in the Income Statement. A key judgement made in applying the above accounting policy relates to investments that are permanently impaired. Where the value of an investment has fallen permanently below cost, the loss is treated as a permanent impairment and as a realised loss, even though the investment is still held. The Board assesses the portfolio for such investments and, after agreement with the Investment Adviser, will agree the values that represent the extent to which an investment loss has become realised. This is based upon an assessment of objective evidence of that investment's future prospects, to determine whether there is potential for the investment to recover in value. The methods of fair value measurement are classified into hierarchy based on the reliability of the information used to determine the valuation. - Level 1 - Fair value is measured based on quoted prices in an active market. - Level 2 - Fair value is measured based on directly observable current market prices or indirectly being derived from market prices. - Level 3 - Fair value is measured using valuation techniques using inputs that are not based on observable market data. ---------------------------------------------------------------------------
Movements in investments during the year are summarised as follows:
Traded Unquoted Unquoted Loan stock Total
on AIM ordinary preference
shares shares
GBP GBP GBP GBP GBP
Cost at 31 December 2016 245,012 17,104,478 29,850 32,235,441 49,614,781
Net unrealised gains/(losses)
at 31 December 2016 112,294 (2,366,432) 2,176 5,775,142 3,523,180
Permanent impairment in value
of investments as at 31 December
2016 - (407,123) (3,078) (1,044,992) (1,455,193)
----------------------------------- ---------- ------------ ------------ ------------- -------------
Valuation at 31 December 2016 357,306 14,330,923 28,948 36,965,591 51,682,768
Purchases at cost (note b) - 1,694,171 - 647,259 2,341,430
Sale proceeds (note c) (367,810) (5,739,297) (2,265) (11,075,715) (17,185,087)
Net realised gains 10,504 2,985,716 2,265 2,250,374 5,248,859
Reclassification at value
(note d) - 722,979 159 (723,138) -
Net unrealised gains/(losses)
for the year (note e) - 840,359 717,270 (2,130,291) (572,662)
----------------------------------- ---------- ------------ ------------ ------------- -------------
Valuation at 31 December 2017 - 14,834,851 746,377 25,934,080 41,515,308
Cost at 31 December 2017 - 18,094,736 27,744 24,109,079 42,231,559
Net unrealised gains at 31
December 2017 - 243,148 718,633 1,825,001 2,786,782
Permanent impairment in cost
of investments as at 31 December
2017 (note f) - (3,503,033) - - (3,503,033)
----------------------------------- ---------- ------------ ------------ ------------- -------------
Valuation at 31 December 2017 - 14,834,851 746,377 25,934,080 41,515,308
Note a) Disposals of Valuation
investment portfolio at 31 Realised
companies during the Investment Disposal December gain
year were: Type cost proceeds 2016 in year
GBP GBP GBP GBP
Entanet Holdings Limited Full Exit 2,713,077 6,123,453 2,819,755 3,303,698 (1)
Gro-Group Holdings
Limited Full Exit 1,975,007 3,452,891 1,703,805 1,749,086
Backhouse Management
Limited Loan repayment 726,480 1,210,800 726,480 - (2)
Creasy Marketing Services
Limited Loan repayment 726,480 1,210,800 726,480 - (2)
McGrigor Management
Limited Loan repayment 726,480 1,210,800 726,480 - (2)
Hollydale Management
Limited Loan repayment 527,580 879,300 527,580 - (2)
Chatfield Services
Limited / Buster and Share buyback
Punch Holdings Limited and loan repayment 845,508 845,508 845,508 -
Barham Consulting Limited Loan repayment 363,240 605,400 363,240 - (2)
Manufacturing Services
Investments Limited Share Buyback 571,200 571,200 571,200 -
TPSFF Holdings Limited Loan repayment 285,688 521,554 521,554 -
Omega Diagnostics Group
plc Full Exit 245,012 367,810 357,306 10,504
Others 18,900 185,571 - 185,571
9,724,652 17,185,087 9,889,388 5,248,859
----------- ----------- ---------- ----------
1 - Deferred contingent consideration of GBP0.63 million is potentially
receivable over the next 12-18 months. There are conditions attached
to this deferred consideration such that the amount receivable
is uncertain and so has not been recognised in the current year's
financial statements.
2 - The gain on the loan repayments above of GBP2,046,840 has
been set off against an equivalent permanent impairment in the
equity instrument of the investments in these companies (see
note f below). Thus, no gain or loss resulted.
Reconciliation of investment transactions to Statement of Cash
flows
Note b) Purchases above of GBP2,341,430 are more than that shown
in the Statement of Cash Flows of GBP1,649,533 by GBP691,897.
This relates to the investment in Ibericos Etc. Limited (trading
as Tapas Revolution) that completed on 4 January 2017. These
funds were included in debtors at the start of the year.
Note c) Investment proceeds shown above of GBP17,185,087 differs
from the sale proceeds shown in the Statement of Cash flows of
GBP13,821,745 by GBP3,363,342. This difference arises because
of proceeds due from the disposal of Gro-Group held in debtors
at the year end (GBP3,452,892) and proceeds relating to the disposal
of Omega Diagnostics Group plc that were held in debtors at the
start of the year (GBP89,550).
Note d) During the year, two investee companies were reorganised
whereby loan stocks held at a value of GBP723,138 were reclassified
as ordinary shares, and ordinary shares of value GBP159 were
reclassified as preference shares.
Note e) The major components of the decrease in unrealised valuations
of GBP572,662 in the year were decreases of GBP928,197 in Veritek
Global Limited, GBP669,059 in Media Business Insight Holdings
Limited, and GBP647,190 in Virgin Wines Holding Company Limited.
These falls were partly offset by increases of GBP669,575 in
Vectair Holdings Limited, GBP526,940 in Master Removers Group
Limited, GBP378,668 in Pattern Analytics Limited (trading as
Biosite), and GBP371,982 in TPSFF Holdings Limited.
The decrease in unrealised valuations of the loan stock investments
above reflects the changes in the entitlement to loan premiums,
and/or in the underlying enterprise value of the investee company.
The decrease does not arise from assessments of credit risk or
market risk upon these instruments.
Note f) During the year, permanent impairments of the cost of
investments have increased from GBP1,455,193 to GBP3,503,033.
The increase of GBP2,047,840 is due to the impairments of equity
of five investee companies referred to in note 2 to note a) above,
and the impairment of GBP1,000 of another company's remaining
investment cost.
9 Current asset investments and Cash at bank
Cash equivalents, for the purposes of the Statement of Cash
flows, comprises bank deposits repayable on up to three months'
notice and funds held in OEIC money-market funds. Current asset
investments are the same but also include bank deposits that
mature after three months. Current asset investments are disposable
without curtailing or disrupting the business and are readily
convertible into known amounts of cash at their carrying values
at immediate or up to three months' notice. Cash, for the purposes
of the Statement of Cash Flows is cash held with banks in accounts
subject to immediate access. Cash at bank in the Balance Sheet
is the same.
---------------------------------------------------------------------
2017 2016
GBP GBP
OEIC Money market funds 20,797,724 4,239,682
Cash equivalents per Statement of Cash Flows 20,797,724 4,239,682
Bank deposits that mature after three months
but are not immediately repayable 1,005,552 1,007,267
------------------------------------------------ ----------- ----------
Current asset investments 21,803,276 5,246,949
------------------------------------------------ ----------- ----------
Cash at bank 3,027,719 5,314,539
------------------------------------------------ ----------- ----------
10 Post balance sheet events
On 18 January 2018, the Company invested GBP0.42 million into
Proactive Group Holdings, Inc.
On 24 January 2018, 3,537,118 ordinary shares were allotted under
the Company's Offer for Subscription for applications received
up to and including 15 January 2018, raising net funds of GBP2.48
million.
On 1 February 2018, TPSFF Holdings Limited made two loan repayments
totalling GBP0.14 million.
On 27 February 2018, the Company invested GBP0.43 million into
Mpb, an existing portfolio company
On 7 March 2018, the Company invested GBP0.58 million into SuperCarers
Limited.
On 13 March 2018, the Company invested GBP0.60 million into Hemmels
Limited.
On 13 March 2018, 7,618,144 ordinary shares were allotted under
the Company's Offer for Subscription raising net funds of GBP5.34
million. As this meant GBP25 million of applications had now
been subscribed, the Offer then closed.
11 Statutory information
The financial information set out in these statements does
not constitute the Company's statutory accounts for the year
ended 31 December 2017 but is derived from those accounts.
Statutory accounts will be delivered to the Registrar of Companies
after the Annual General Meeting. The auditors have reported
on these accounts and their report was unqualified and did
not contain a statement under section 498(2) of the Companies
Act 2006.
12 Annual Report
The Annual Report will be published on the Company's website
at www.migvct.co.uk shortly and shareholders who have not
requested a hard copy of the report will shortly receive notification
from the Company on how to download a pdf of the Report from
the website. Shareholders and members of the public who wish
to receive a hard copy of the Annual Report, may request a
copy by writing to the Company Secretary, Mobeus Equity Partners
LLP, 30 Haymarket (4th floor), London SW1Y 4EX or by email:
vcts@mobeusequity.co.uk.
13 Annual General Meeting
The Annual General Meeting of the Company will be held at
2.00 p.m. on Wednesday, 9 May 2018 at The Clubhouse, 8 St
James's Square, London, SW1Y 4JU.
Contact details for further enquiries:
Robert King or Robert Brittain of Mobeus Equity Partners LLP
(the Company Secretary) on 020 7024 7600 or by e-mail to vcts@mobeusequity.co.uk.
Mark Wignall or Mike Walker at Mobeus Equity Partners LLP
(the Investment Adviser) on 020 7024 7600 or by e-mail to
info@mobeusequity.co.uk.
DISCLAIMER
Neither the contents of the Company's website nor the contents
of any website accessible from hyperlinks on the Company's
website (or any other website) is incorporated into, or forms
part of, this announcement.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR PGUUPWUPRGWM
(END) Dow Jones Newswires
March 27, 2018 11:14 ET (15:14 GMT)
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