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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| Oxford Technology Venture Capital Trust Plc | LSE:OXT | London | Ordinary Share | GB0006640204 | 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% | 27.50 | 0.00 | 01:00:00 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| 0 | 0 | N/A | 0 |
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Oxford Technology VCT Plc
Unaudited Half-Yearly Report
For the period 1 March 2020 to 31 August 2020
6 Months Ended Year Ended
31 August 2020 29 February 2020
-------------------------------- --------------- -----------------
Net Assets At Period End GBP1.97m GBP2.43m
-------------------------------- --------------- -----------------
Net Asset Value (NAV) Per Share 36.2p 44.7p
-------------------------------- --------------- -----------------
Cumulative Dividend Per Share 55.0p 55.0p
-------------------------------- --------------- -----------------
Total NAV Return Per Share 91.2p 99.7p
-------------------------------- --------------- -----------------
Share Price At Period End
(Mid-Market) 28.0p 33.0p
-------------------------------- --------------- -----------------
Earnings Per Share (8.5)p (4.9)p
-------------------------------- --------------- -----------------
Statement on behalf of the Board
I am pleased to present the unaudited results for the six month period
ended 31 August 2020. The period under review continues to be dominated
by the implications of the Covid-19 pandemic and the subsequent actions
of the UK government. Your Investment Adviser and the Directors have
continued to manage the VCT and its portfolio effectively together via
remote working during lockdown.
The six months to 31 August 2020 have been a volatile and uncertain
period for the economy and for businesses operating within this
environment. During this period, your Board has kept the impact of the
pandemic on your Company's investments closely under review as part of
our regular Board agenda. On 19 May 2020, when we issued our annual
report, we reviewed the portfolio valuation since the year ended 29
February 2020 and this led to us announce a reduction in the NAV per
ordinary share from 44.7p to an unaudited 38.8p. Since then, the
pandemic along with the lockdown has continued to impose great
uncertainty for UK companies. However our overall portfolio has remained
relatively stable as the technology sector has been less severely
impacted than others.
Results and Dividend
The Company's net asset value (NAV) per ordinary share has decreased by
8.5p per share from 44.7p at 29 February 2020 to 36.2p per share as at
31 August 2020, the biggest factor in this decrease being a reduction of
the valuation of Select Technology, as explained in the Portfolio Review
section below.
As noted above, the NAV as at 31 August 2020 of 36.2p per ordinary share
is a reduction of 1.6p since the mid-May update of 38.8p per share.
Additionally, since 31 August 2020, the share price of Scancell has
increased. As at early October, the Scancell bid price is 16.0p,
implying a Company NAV of 45.9p per ordinary share on the basis that the
unquoted portfolio is unchanged in value from 31 August 2020.
The Directors are not recommending the payment of a dividend at this
time.
Portfolio Review
Select Technology distributes high quality document management software
via its global channel partners while adding significant further value
through its development team by providing integrations and bespoke
solutions. Sales have been significantly affected by Covid-19 with
sales from February to July, being about 50% down on the previous six
months. However, the greatest impact was in April and May. Sales have
revived somewhat in the most recent months and the hope is that this
continues. Select Technology has typically paid a regular dividend, but
we are not assuming that Select Technology will be in a position to
distribute excess cash in the immediate near future. The Company's
stake in Select Technology was nearly 60% of NAV as at 31 August 2020,
or around 47% as at early October due to the rise in the share price of
Scancell since 31 August 2020.
Scancell continues to develop its multiple technologies. The SCIB1 Phase
2 clinical trial programme will continue with further sites later this
year and the Modi-1 Phase1/2 trial is progressing for regulatory
submission with a planned study start in the UK in 1H21. In August,
Scancell announced it had been awarded a grant to develop its COVIDITY
Covid-19 vaccine based on its Immunobody platform into a Phase1 clinical
trial. In August, it also completed a fundraising to raise GBP15 million
at a price of 5.5p per share, and which included a significant new US
institutional investor (Redmile Group LLC). This funding will allow
planned trials to continue while partnering discussions are pursued. As
a result of all this news, the Scancell share price has seen much
volatility, both during the period to 31 August 2020 and later. The
share price was 8.0p as at 31 August 2020 (on which these valuations are
based) and has subsequently doubled to 16p as at early October 2020.
The Company sold GBP30k worth of Scancell shares prior to 31 August 2020
at an average price of 8.4p per share and, subsequent to the period end,
a further GBP40k (at an average price of 16.9p per share) crystallising
some of the gain on the Company's investment in Scancell and for
liquidity purposes.
The other two smaller stakes in the portfolio have moved in different
directions, without materially affecting the Company's overall NAV.
BioCote has seen a modest increase in value -- in the current climate
there has been substantial interest in its products but this has not
translated into a material increase in sales. Getmapping's value has
fallen given ongoing uncertainty in its markets. After the period end,
Getmapping won a grant from West Midlands 5G and Transport for West
Midlands to develop a predictive parking system that uses kerbside
imaging to reduce the amount of time spent finding a parking space.
The Directors, along with the Investment Adviser, continue to take an
active interest in the companies within the portfolio, both to support
their management teams to achieve company development, but also to
prepare companies for realisation at the appropriate time. It should
however be noted that approaches do occur at other times, and the
ability of the Directors and Investment Adviser to be able to provide
support when such approaches occur is essential for maximising value.
VCT qualifying status
The small size of the VCT means significant focus is required to ensure
we retain sufficient working capital to manage the Company whilst
meeting all the conditions laid down by HMRC for maintaining approval as
a VCT. The Board has procedures in place to ensure that the Company
continues to comply with these conditions, in particular the new 80%
qualifying holding limit which has been in place since 1 March 2020.
Presentation of half-yearly report
In order to reduce the length of this report, we have omitted details of
the Company's objectives and investment strategy, its Advisers and
Registrar and how to buy and sell shares in the Company. These details
are all included in the Annual Reports, which together with previous
half-yearly reports, are available for viewing on the Oxford Technology
website.
Cost Control
As we have previously reported, your Board continues to look at methods
of improving operational efficiency, reducing costs and, more generally,
putting in place appropriate plans to ensure that your VCT's operational
costs relative to its overall size remain within acceptable limits. Our
investment management fees, Directors' fees and auditors' remuneration
are amongst the lowest in the VCT industry. The largest remaining
elements of cost are the LSE listing fee at almost GBP10k and the FCA
fee of GBP6k per annum. The LSE has proposed a 60% increase in its fees
for the coming year, which your Directors believe is unacceptable. We
have reopened our dialogue with the LSE and will continue to fight for
appropriate fees to be levied.
Outlook
Nothing has changed in our plans for your Company. We continue to
believe your VCT is an appropriate structure to hold your Company's
investments, but as we have indicated for some time, it would be
preferable to have a larger asset base to share the operating costs. I
have reported previously of our efforts to seek prospective parties who
are potentially interested in entering the VCT industry. This initiative
is currently on hold whilst any such possible organisations are entirely
focussed on more immediate actions within their own businesses as a
result of the Covid-19 pandemic. We have always made clear that there is
no certainty such a route can be achieved, but the Directors will
continue seeking such opportunities when the future outlook has become
clearer. Furthermore, whatever the outcome of the discussions with the
LSE, the seemingly relentless upward trajectory of these regulatory
costs has resulted in your Directors revisiting the economics of a
merger with some or all the other VCTs in the Oxford Technology stable;
such a transaction is not without risk and it is by no means clear that
it would be in your Company's best interests to participate in such a
transaction. We will update shareholders if and when these discussions
reach a conclusion, and in any event, shareholder approval would then be
required before any transaction could proceed.
Apart from the change to investment qualifying levels, there have been
no recent changes to VCT legislation, or their potential impact on both
the VCT and its investee companies. It is still too early to fully
assess the impact of Covid-19, and the resulting government
interventions. Whilst the impact of Brexit remains unclear, your
Directors do not expect its eventual outcome to have a material impact
on portfolio valuations. Your Board and Investment Advisor continue to
work so as to best position your VCT such that, when valuations and
liquidity allow, holdings can be exited and proceeds distributed to
shareholders, whilst keeping a keen eye on maintaining costs as low as
possible in the interim.
Finally, I would like to take this opportunity to thank shareholders for
their continued support. We were delighted a significant number of you
managed to attend our zoom AGM, and we will consider the merits of
future online forums in due course which allow a greater number of
shareholders to attend. We hope our shareholders have not been too
personally affected by the difficulties this year and look forward to a
return to an 'old normal' as soon as possible.
Alex Starling - Chairman
8 October 2020
Investment Portfolio as at 31 August 2020
Change in
Carrying value for %
Net Cost value at the % Equity Equity
of investment 31/08/20 6 month period held held All %
Company Description GBP'000 GBP'000 GBP'000 OT1 OTVCTs Net assets
------------------ --------------------- -------------- --------- --------------- -------- --------- -----------
Specialist
Select -- STL Photocopier
Management Ltd interfaces 488 1,155 (513) 30.0 58.6 58.7
------------------ --------------------- -------------- --------- --------------- -------- --------- -----------
Scancell Antibody based
(bid price 8.0p) cancer therapeutics 326 522 82 1.0 2.0 26.5
------------------ --------------------- -------------- --------- --------------- -------- --------- -----------
Bactericidal
BioCote additives 85 180 15 6.6 6.6 9.2
------------------ --------------------- -------------- --------- --------------- -------- --------- -----------
Getmapping Aerial photography 518 115 (52) 3.7 3.7 5.8
------------------ --------------------- -------------- --------- --------------- -------- --------- -----------
Total Investments 1,417 1,972 (468) 100.2
----------------------------------------- -------------- --------- --------------- -------- --------- -----------
Other Net Liabilities (5) (0.2)
----------------------------------------- -------------- --------- --------------- -------- --------- -----------
Net Assets 1,967 100.0
----------------------------------------- -------------- --------- --------------- -------- --------- -----------
Responsibility Statement of the Directors in respect of the half-yearly
report
We confirm that to the best of our knowledge:
-- the half-yearly financial statements have been prepared in accordance
with the statement "Interim Financial Reporting" issued by the Financial
Reporting Council;
-- the half-yearly report includes a fair review of the information required
by the Financial Services Authority Disclosure and Transparency Rules,
being:
-- an indication of the important events that have occurred during the first
six months of the financial year and their impact on the condensed set of
financial statements.
-- a description of the principal risks and uncertainties for the remaining
six months of the year.
-- a description of related party transactions that have taken place in the
first six months of the current financial year that may have materially
affected the financial position or performance of the Company during that
period and any changes in the related party transactions described in the
last annual report that could do so.
-- The assets of the Company include cash and shares in an AIM quoted
company which is quite liquid and readily accessible. After reviewing the
forecast for the Company, the Directors have a reasonable expectation
that the Company has adequate resources to continue in operational
existence for the foreseeable future. The Company therefore continues to
adopt the going concern basis in preparing the half year accounts.
On behalf of the Board:
Alex Starling - Chairman
8 October 2020
Income Statement
Six months to 31 Aug 2020 Six months to 31 Aug 2019 Year to 29 Feb 2020
Revenue Capital Total Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------------------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- -------------
Gain on disposal of fixed asset investments - 7 7 - - - - - -
Unrealised (loss)/ gain on valuation of fixed asset
investments - (445) (445) - 17 17 - (230) (230)
Investment income 10 - 10 10 - 10 27 - 27
Investment management fees (6) - (6) (2) (5) (7) (13) (13)
Other expenses (27) - (27) (23) - (23) (49) - (49)
---------------------------------------------------- ------------- ------------- -------------
Return on ordinary activities
before tax (23) (438) (461) (15) 12 (3) (35) (230) (265)
Taxation on ordinary activities - - - - - - - - -
---------------------------------------------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- -------------
Return on ordinary activities
after tax (23) (438) (461) (15) 12 (3) (35) (230) (265)
---------------------------------------------------- ------------- ------------- ------------- ------------- -------------
Earnings per share -- basic and diluted (0.4)p (8.1)p (8.5)p (0.3)p 0.2p (0.1)p (0.7)p (4.2)p (4.9)p
---------------------------------------------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- ------------- -------------
There was no other Comprehensive Income recognised during the year.
The 'Total' column of the Income Statement is the Profit and Loss
Account of the Company, the supplementary Revenue and Capital return
columns have been prepared under guidance published by the Association
of Investment Companies.
All Revenue and Capital items in the above statement derive from
continuing operations.
The Company has only one class of business and derives its income from
investments made in shares and securities and from bank and money market
funds.
Balance Sheet
As at 31 Aug As at 31 Aug
2020 2019 As at 29 Feb 2020
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- ------- ------- -------
Fixed asset investments at
fair value 1,972 2,687 2,440
Debtors 4 8 10
Cash at Bank 36 16 18
Creditors: amounts falling
due within one year (45) (21) (40)
Net current
(liabilities)/assets (5) 3 (12)
Net assets 1,967 2,690 2,428
--------------------------- ------- ------- ------- ------- -------------- -------
Called up share capital 543 543 543
Share premium reserve 176 176 176
Unrealised capital reserve 555 1,252 1,005
Profit and Loss account 693 719 704
Total equity shareholders'
funds 1,967 2,690 2,428
Net asset value per share 36.2p 49.5p 44.7p
--------------------------- ------- ------- ------- ------- -------------- -------
Statement of Changes in Equity
Unrealised Profit &
Share Premium Capital Loss
Share Capital Reserve Reserve Account Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------------------------------------- ------------- ------------- ---------- -------- --------
As at 1 March 2019 543 176 1,235 739 2,693
Revenue return on ordinary activities
after tax - - - (20) (20)
Current period gains on fair
value of investments - - 17 - 17
Balance as at 31 August 2019 543 176 1,252 719 2,690
-------------------------------------- ------------- ------------- ---------- -------- --------
As at 1 March 2019 543 176 1,235 739 2,693
Revenue return on ordinary activities
after tax - - - (35) (35)
Current period losses on fair
value of investments - - (230) - (230)
Balance as at 28 February 2020 543 176 1,005 704 2,428
-------------------------------------- ------------- ------------- ---------- -------- --------
As at 1 March 2020 543 176 1,005 704 2,428
Revenue return on ordinary activities
after tax - - - (23) (23)
Current period gains on disposal - - - 7 7
Prior year unrealised gains
now realised - - (5) 5 -
Current period losses on fair
value of investments - - (445) - (445)
Balance as at 31 August 2020 543 176 555 693 1,967
-------------------------------------- ------------- ------------- ---------- -------- --------
Statement of Cash Flows
Six months to Six months to Year to
31 Aug 2020 31 Aug 2019 29 Feb 2020
GBP'000 GBP'000 GBP'000
---------------------------------------------- ------------- ------------- ------------
Cash flows from operating activities
Return on ordinary activities before tax (461) (3) (265)
Adjustments for:
Loss/(gain) on valuation of fixed asset
investments 445 (17) 230
Gains on disposal of fixed asset
investments (7) - -
Increase in creditors 5 9 28
Decrease/(increase) in debtors 6 (6) (8)
Outflow from operating
activities (12) (17) (15)
---------------------------------------------- ------------- ------------- ------------
Cash flows from investing activities
Purchase of fixed asset investments - - -
Disposal of investments 30 - -
---------------------------------------------- ------------- ------------- ------------
Total cash flows from investing activities 18 - -
Cash flows from financing activities
Total cash flows from financing activities - - -
Decrease in cash and cash equivalents 18 (17) (15)
Opening cash and cash equivalents 18 33 33
Closing cash and cash equivalents 36 16 18
---------------------------------------------- ------------- ------------- ------------
Notes to the Half-Yearly Report
1. Basis of preparation
The unaudited half-yearly results which cover the six months to 31
August 2020 have been prepared in accordance with the Financial
Reporting Council's (FRC) Financial Reporting Standard 104 Interim
Financial Reporting ('FRS 104') and the Statement of Recommended
Practice (SORP) for Investment Companies re-issued by the Association of
Investment Companies in November 2014. Details of the accounting
policies and valuation methodologies are included in the Annual Report.
2. Publication of non-statutory accounts
The unaudited half-yearly results for the six months ended 31 August
2020 do not constitute statutory accounts within the meaning of Section
415 of the Companies Act 2006. The comparative figures for the year
ended 29 February 2020 have been extracted from the audited financial
statements for that year, which have been delivered to the Registrar of
Companies. The independent auditor's report on those financial
statements, in accordance with chapter 3, part 16 of the Companies Act
2006, was unqualified. This half-yearly report has not been reviewed by
the Company's auditor.
3. Earnings per share
The calculation of earnings per share for the period is based on the
return attributable to shareholders divided by the weighted average
number of shares in issue during the period. There are no potentially
dilutive capital instruments in issue and, therefore, no diluted returns
per share figures are relevant.
4. Net asset value per share
The net asset value per share is based on the net assets at the period
end divided by the number of shares in issue at that date (5,431,655 in
each case).
5. Principal risks and uncertainties
The Company's assets consist of equity and fixed interest investments,
cash and liquid resources. Its principal risks are therefore market risk,
credit risk and liquidity risk. Other risks faced by the Company include
economic, loss of approval as a Venture Capital Trust, investment and
strategic, regulatory, reputational, operational and financial risks.
These risks, and the way in which they are managed, are described in
more detail in the Company's Annual Report and Accounts for the year
ended 29 February 2020. The Company's principal risks and uncertainties
have not changed materially since the date of that report.
6. Related party transactions
OT1 Managers Ltd, a wholly owned subsidiary, provides investment
management services to the Company for a fee of 0.5% of net assets per
annum.
7. Events after the balance sheet date
On 14 September 2020, following the period end, the Company sold 136,577
Scancell shares at a price of 14.65p following the sharp share price
rise on AIM surrounding news about the novel DNA vaccine against
Covid-19 being worked on by Scancell. On 2 October 2020, the Company
sold a further 100,043 shares at a price of 20.05p. The bid price used
for valuation at the period end was 8.0p.
8. Copies of this statement are available from Oxford Technology
Management, Magdalen Centre, Oxford Science Park, Oxford OX4 4GA and on
the Company's website.
Board Directors: Alex Starling, Robin Goodfellow, Richard Roth and David
Livesley
Investment Manager: OT1 Managers Ltd with services contracted to Oxford
Technology Management Ltd
Website:
https://www.globenewswire.com/Tracker?data=w1FDPEx4TyoZtPZn_3hlFIHjeVFwazZBuix2UbPEdXKIvtO1ZnFhfRmBsG06LLXBodLMgXiHwZqUjDbf2Kg0cNGtvMrFM6gmpccTIX1O4QywCxwTdMPDJbZRrYHAeBXGlrenbL-B7cjtHToFvsg4Yw==
www.oxfordtechnologyvct.com/vct1.html
The information above is deemed by the Company to constitute inside
information as stipulated under the Market Abuse Regulations (EU No.
596/2014). Upon the publication of this announcement via a Regulatory
Information Service this inside information is now considered to be in
the public domain.
Enquiries -- Lucius Cary
Oxford Technology Management
01865 784466
(END) Dow Jones Newswires
October 09, 2020 02:00 ET (06:00 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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