TIDMPGOO
PROVEN GROWTH AND INCOME VCT PLC
ANNUAL FINANCIAL REPORT
YEARED 29 FEBRUARY 2020
ProVen Growth and Income VCT plc, managed by Beringea LLP, today
announces the final results for the year ended 29 February 2020. These
results were approved by the Board of Directors on 1 July 2020.
You may, in due course, view the Annual Financial Report in full at
https://www.globenewswire.com/Tracker?data=3aSoHewhtv85eraUrtfiQPDasMnJ33-k56ck79zOxKozZTgBDTKDuyI52LihUYDiMNc4_XgX6ke22PqaofbiN4N7egtJAYRbdmTS5palbPU=
www.provenvcts.co.uk. All other statutory information can also be found
there.
Financial summary
29
February
2020 28 February
Ordinary Shares as at: Pence 2019 Pence
Net asset value per Ordinary Share 58.6 68.4
Dividends paid since class launch (originally as 'C'
Shares) 64.4 60.9
Total return (net asset value plus dividends paid
since 'C' Share class launch) 123.0 129.3
Year on year change in:
Net asset value per share (adjusted for dividends
paid in the year) (9.2%) 3.9%
Chairman's Statement
I present the Annual Report for ProVen Growth and Income VCT plc (the
"Company") for the year ended 29 February 2020. This report focuses
primarily on the year to 29 February but as Shareholders are all aware,
subsequent to the year end, the Coronavirus pandemic occurred which had
a signi cant impact on the economy as a whole and on the Company. The
portfolio has been regularly reviewed in this time and a new NAV was
released in March in advance of the share allotments in early April
under the Company's most recent o er for subscription.
Results for the year
Over the year, there was a decrease in Shareholder total return (net
asset value ("NAV") per share plus dividends) of 9.2% which was largely
attributable to the decrease in valuation of four companies. The
Company's NAV per share fell from 68.4p at 28 February 2019 to 58.6p at
29 February 2020. This included a reduction of 3.5p in relation to
dividend payments.
The total loss on ordinary activities for the year was GBP12.3 million
(2019: pro t of GBP3.8 million), comprising a revenue loss of
GBP758,000, or 0.4p per share, (2019: revenue loss of GBP736,000, 0.5p
per share) and a capital loss of GBP11.6 million, or 6.2p per share
(2019: pro t of GBP4.6 million, 3.2p per share). This capital loss was
largely caused by an aggregate decrease of GBP10.2 million in the
valuation of four portfolio companies.
Dividends
During the year ended 29 February 2020, the Company paid a nal dividend
of 2.0p per share in respect of the year ended 28 February 2019 on 19
July 2019 and an interim dividend of 1.5p per share was paid in respect
of the year ended 29 February 2020 on 6 December 2019.
Your Board is proposing a nal dividend for the year ended 29 February
2020 of 1.75p per share to be paid on 28 August 2020 to Shareholders on
the register at 7 August 2020. With total tax-free dividends of 3.25p
per share for the year ended 29 February 2020, this represents cash
returned to Shareholders of 5.0% on the opening NAV per share at 1 March
2019 after deducting the prior year nal dividend of 2.0p per share.
Portfolio activity and valuation
Following a period of several years during which a number of pro table
disposals generated strong returns for Shareholders, the focus during
the year has been on supporting the existing portfolio and adding new
investments.
The Company invested a total of GBP25.6 million during the year. Six new
companies were added to the portfolio, at a cost of GBP17.3 million. As
is the nature of early stage investing, there is usually a delay before
the bene t of the Company's investment is re ected in the performance of
the portfolio company. We would not, therefore, expect to recognise an
increase in valuation of new investments for some time.
The Company also provided further investment, totalling GBP8.3m, to
seven of the companies which the Company has invested in during the last
few years. Further details of all these investments are provided in the
Investment Manager's Review.
The performance of the companies in the portfolio during this year in
particular has been mixed. This is to be expected given the Company has
a relatively young portfolio of venture capital investments which can
take time to bed down and generate returns. Some companies saw increases
in valuation o the back of strong trading, whereas others declined in
value as a result of di cult trading as well as reduced multiples. The
portfolio had an overall decrease in value of GBP10.1 million in the
year (2019: increase of GBP3.4m). It is important to remember that
investment in venture capital should be considered as a long-term
investment and returns should be measured over the medium term, not a
single year.
Further information about key developments at existing portfolio
companies is given in the Investment Manager's Review.
Fundraising activities
As communicated in the interim statement, the combined o er for
subscription with ProVen VCT plc launched on 11 January 2019 to raise up
to a total of GBP30 million per company, with an over-allotment facility
of GBP10 million per company, was fully subscribed due to strong
investor demand.
The Company launched a further combined o er for subscription with
ProVen VCT plc on 27 January 2020 to raise up to GBP10 million per
company, with an over-allotment facility of GBP10 million per company,
which the Board utilised in part in the amount of up to GBP5 million per
company. The o er closed to new applications on 19 March 2020 with
GBP14.2 million of gross proceeds for the Company.
Share buybacks
The Company has a policy of buying back shares that become available in
the market at a discount of approximately 5% to the latest published Net
Asset Value, subject to the Company having su cient liquidity. The
Company retains Panmure Gordon to act as its corporate broker.
Shareholders who are considering selling their shares may wish to
contact Panmure Gordon, who will be able to provide details of the price
at which the Company is buying shares.
During the year, the Company purchased 2,422,467 Ordinary Shares at an
average price of 60.1p per share and for an aggregate consideration of
GBP1,456,000. This represented 1.7% of the Company's issued share
capital at the start of the year. All shares were subsequently
cancelled.
A special resolution to allow the Company to continue to make market
purchases of its own shares of up to 14.99% of the share capital for
cancellation will be proposed at the forthcoming Annual General Meeting
("AGM").
Performance Fee
The Company's performance incentive arrangements are an important aid
for the Investment Manager, Beringea LLP ("Beringea" or the "Investment
Manager"), in recruiting and retaining talented investment professionals
against competition from other investment management companies. The
performance fee structure is designed to align the interests of the
Investment Manager with those of Shareholders and encourages capital
growth as well as signi cant payments to Shareholders by means of
tax-free dividends, as determined by the Directors. These arrangements
are set out in more detail in the Strategic Report.
Based on the NAV per share at 29 February 2020, no performance fee is
accrued at the year-end as the performance hurdles were not met and as
such no present obligation exists and therefore no liability has been
recognised.
The payment of a performance fee in future years and the amount thereof,
if any, will be dependent on both the performance of the Company and the
level of dividends paid to Shareholders, as determined by the Directors.
Board
As the Company recently announced James Stewart will resign as a
Director following this year's AGM. James has served as a director of
the Company since February 2001, and his sound stewardship and
commercial judgement have played a signi cant part in the Company's
success. The Board would like to thank James for his valuable
contribution over the years, we will miss him as a friend as well as a
colleague. We are delighted that Anna Kuriakose will replace James as
the Audit Committee Chairman.
Apart from James's resignation and the appointment of Anna as mentioned
in the interim report and accounts, there have been no other changes to
the Board.
Annual General Meeting
In planning our AGM we have sought to prioritise the safety and
wellbeing of our Shareholders and employees. In light of the current
Coronavirus 'social distancing' measures in England, and the legislative
measures that have been proposed to allow companies to hold general
meetings safely, the AGM will be held as a closed AGM and Shareholders
will not be able to attend the AGM this year. The meeting will still
comply with the minimum legal requirements for an AGM.
The closed AGM will be held at 1.30 p.m. on Monday 10 August 2020 via
electronic means. Full details of the business to be conducted at the
AGM are given in the formal Notice of Annual General Meeting which will
be sent to Shareholders by their preferred method in due course.
Resolution 12 proposes a change to the Company's Articles of Association
that will allow Shareholders to participate remotely in future AGMs. A
copy of the proposed new articles of association is available on the
website at https://www.provenvcts.co.uk/.
Shareholders are encouraged to submit their votes by proxy, as they will
not be able to do so in person. In addition, we strongly recommend
voting electronically at www.signalshares.com as your vote will
automatically be counted. Given the current situation, with many people
working from home and delays in the postal system, there is a risk that
your vote may not be counted if you send a paper proxy.
We always welcome questions from our Shareholders at the AGM but this
year, given the restrictions in place, please send any questions via
email to info@beringea.co.uk by 5:00 pm on Monday 3 August 2020. Answers
to the themes in the questions received will be addressed on the website
at https://www.provenvcts.co.uk/. In addition, the Company's annual
Shareholder event will proceed in the Autumn, albeit in a di erent
format (further details below).
Shareholder event
The Company's annual Shareholder event provides an important opportunity
for Shareholders to hear from the Investment Manager, discussing
performance and investment activity, as well as receiving insights and
updates from our portfolio companies.
For your Board and the Investment Manager, it is also a vital platform
for gathering and discussing the views of our Shareholders. It is with
this in mind that we are seeking to ensure that we can continue to
deliver the Shareholder event in the current environment.
Therefore, in order to ensure the safety and wellbeing of our
Shareholders, employees and portfolio companies, we will be hosting our
rst fully-digital Shareholder Day in the Autumn, using an online
platform to deliver our usual insights into fund performance and market
conditions, as well as providing an opportunity for you to ask questions
of our investment team and hear from our portfolio companies.
We will soon distribute invitations to this digital event, as well as
providing you with further information on the format and logistics for
the day and we would encourage you to join us for the session.
Outlook
The combination of Brexit and COVID 19 has provided an unprecedented
economic, social and political backdrop for the market as a whole.
Despite this, the Company has been able to remain active and productive
and managed to deliver a successful fundraise, provide important
resources to support our portfolio and continue to harness a resilient
pipeline of investment opportunities.
Subsequent to the year-end, the economic and commercial turbulence
created by the Coronavirus pandemic has resulted in a revaluation of the
portfolio to take account of the context in which we are now operating
and the announcement of a reduced net asset value in March of 54.6p per
share.
The Company has been pleased to see how the Investment Manager has
guided the portfolio companies through the immediate shock of the
outbreak and it is now working alongside these portfolio companies to
help them prepare and adapt to the trading environment. The Directors of
the Company will continue to monitor the performance of the portfolio
carefully and will announce a new net asset value per share if there is
a material movement in valuations.
We warmly welcome our new Shareholders who joined the fund as part of
the share o er that successfully closed in March. The funds raised
provide the Company with additional resources to support our existing
portfolio through any prolonged economic disruption, and ensure that it
is able to harness a pipeline of investment opportunities that remains
resilient. The Investment Manager has continued to do this following a
successful transition to operating remotely during the lockdown, with
recent additions to the portfolio and follow-on investments completed
through an entirely digital process.
Despite the current challenging economic and social conditions, the
Board remains con dent that the Company has resilient long-term
prospects.
Marc Vlessing OBE
Chairman
Investment Manager's Review
Introduction
Following a number of successful realisations in the last couple of
years, the focus this year was on investing into new portfolio companies
as well as supporting the current portfolio. During the year, a total of
GBP17.3 million was invested in six new portfolio companies and GBP8.3
million in seven existing portfolio companies.
At 29 February 2020, the Company's venture capital portfolio comprised
46 investments at a cost of GBP84.2 million and a valuation of GBP77.8
million, an overall decrease of 7.7% on cost.
Subsequent to the year end the Company issued 24,518,370 Ordinary Shares
for an aggregate consideration of GBP14.2 million under the combined o
er for subscription with ProVen VCT plc which launched on 27 January
2020. Share issue costs thereon amounted to GBP577,000. The Company
remains well capitalised to take advantage of new investment
opportunities and support existing portfolio companies where
appropriate.
Investment activity
New investments
We continued to experience a strong level of deal ow, with GBP17.3
million being invested during the year in six new portfolio companies.
The new investments in the year are:
-- Sannpa Limited (t/a Fnatic) (GBP5.9m) -- an eSports team
owner and lifestyle brand, with professional teams in the most popular
games such as League of Legends, Dota 2 and Battle eld 4;
-- Papier Ltd (GBP3.15m) -- an online stationery retailer,
specialising in unique curated collections;
-- Our Path Ltd (t/a Second Nature) (GBP2.8m) -- a provider
of a digital healthcoaching app, with an evidence-based program for
lifestyle change and diabetes prevention/weight loss;
-- Arctic Shores Limited (GBP2.45m) -- a provider of
data-driven psychometric tests combining neuroscience, arti cial
intelligence and game technology for more predictive and less biased
employee recruitment;
-- Stylescape Limited (t/a EDITED) (GBP1.50m) -- a SaaS
provider of pricing and product intelligence for apparel and fashion
retailers; and
-- Picasso Labs, Inc. (GBP1.47m) - an automated creative
measurement platform that aims to enhance creativity through
objectivity. Their technology is used globally by Fortune 500 brands
like Unilever, Mondelez, and Heineken to measure creative e ciency,
consistency, and impact across all creatives worldwide.
Follow-on investments
The Company has also been active in supporting the development of
existing portfolio companies, making follow-on investments in the
following seven companies during the year: Mycs (GBP1.8m), ContactEngine
(GBP1.6m), Aistemos (GBP1.4m), Thread (GBP1.4m), Festicket (GBP0.9m),
MPB (GBP0.7m) and POQ (GBP0.5m).
Investment disposals
As reported in the interim statement, the Company's shareholding in
7digital Group was sold in the year resulting in a loss against cost of
GBP0.4 million. The loss was recognised in previous years so there was
no impact to the NAV during the year.
Rapid Charge Grid repaid GBP472,000 of loans to the Company during the
year.
Skills Matter repaid GBP68,000 of its loan notes during the year.
Key developments at existing portfolio companies
Several companies have seen increases in value at the year end, owing to
strong performance.
ContactEngine performed well in the year, securing several large new
customer contracts. In November, it won the award for "Best use of IP"
at the Sunday Times Hiscox Tech Track 100 awards. ContactEngine closed a
further funding round of GBP3.75 million in August 2019, to which the
Company contributed GBP1.6 million. The value of the Company's
investment has increased to GBP5.09m on a cost of GBP2.33m.
DeepCrawl has grown its revenue signi cantly in the year. It also closed
a $15 million funding round in December 2019, led by specialist US
software investor, Five Elms. This has given DeepCrawl signi cant
repower to invest in accelerating its growth rate, particularly in the
USA which already accounts for more than half of its revenue. This has
led to an increase in value of the Company's investment to GBP3.2
million on a cost of GBP1.6 million.
A number of portfolio companies have faced di cult trading conditions
during the year. In particular four companies gave rise to an overall
decrease in valuation of GBP10.2 million.
POQ studio, InContext and SmartAssistant have faced obstacles over the
past twelve months and have struggled to hit their milestones and grow
their revenues as originally budgeted. As a result, there has been a
combined decrease in valuation of GBP8.1 million.
Blis has been impacted by the falling comparative multiples for
advertising technologies used to value the business as well as slower
than anticipated growth in revenues. This has led to a reduction in
value of GBP2.1 million.
We continue to work closely with these companies to help them through
these challenges.
Overall, the investment portfolio held at the year-end showed a decrease
in value of GBP10.1 million (2019: increase of GBP3.4 million).
Post year-end developments
The global Coronavirus pandemic has impacted a wide range of companies.
On 23 March this year a revised NAV of 54.6p per share was announced to
re ect the immediate valuation impact on the Company's portfolio. This
compares to a NAV of 58.6p per share as at 29 February 2020.
Between 29 February 2020 and the date of this report, the Company issued
24,518,370 Ordinary Shares for an aggregate consideration of GBP14.2
million under the combined o er for subscription with ProVen VCT plc
which launched on 27 January 2020. Share issue costs thereon amounted to
GBP577,000.
The Company has invested into the following new companies subsequent to
the year end:
-- Commonplace (GBP1.5 million) - a B2B software company
that has developed a digital community engagement platform enabling
developers, local authorities, transport planners, infrastructure
developers and other large project owners to engage with local
communities; and
-- Luxury Promise (GBP1.35 million) a re-sale platform for
luxury women's handbags and accessories
The Company also made follow on investments into Fnatic (GBP0.5 million),
Thread (GBP0.42 million) and ContactEngine (GBP125,000).
Outlook
The short-term outlook for the UK economy will be dominated by the
Coronavirus pandemic. We will continue to work closely with our
portfolio companies to support them through the challenges this has
created, including providing additional investment where this is
appropriate. Fortunately, few of the investments in the portfolio are in
sectors which have been severely a ected by Coronavirus, such as travel,
hospitality and traditional retailing. Therefore, despite the recent
reductions in the valuations of some portfolio companies, we are
cautiously optimistic about the prospects of the portfolio as a whole
over the medium term.
Following the recent fundraising, the Company is now well placed to take
advantage of new investment opportunities. While some companies have
been badly a ected by Coronavirus, others have seen minimal impact and
certain sectors are likely to bene t from the acceleration of market
trends arising from the Coronavirus. We are still seeing a strong ow of
investment opportunities and will continue to invest selectively where
we believe companies have excellent
long-term prospects and the pricing of the investment is appropriate.
The economic disruption caused by Coronavirus may result, over the next
12 months, in a softening of the lofty investment valuations we have
seen recently. This should help to deliver strong returns from
investments made during this period.
Despite the turbulent broader economic and political environment, we
believe that there will still be opportunities for well-managed, agile,
entrepreneurial companies to prosper. We believe the Company is well
placed to take advantage of opportunities to invest in these businesses.
Beringea LLP
Investment Manager
Investment activity
Investment activity during the year is summarised as follows:
Additions
Cost GBP'000
Sannpa Limited (t/a Fnatic) 5,946
Papier Ltd 3,150
Our Path Ltd (t/a Second Nature) 2,800
Arctic Shores Limited 2,450
Mycs GmbH 1,756
ContactEngine Limited 1,642
Stylescape Limited (t/a EDITED) 1,500
Picasso Labs, Inc. 1,470
Aistemos Limited 1,405
Thread, Inc. 1,400
Festicket Ltd 897
MPB Group Limited 700
POQ Studio Ltd 500
Total 25,616
------------
Disposals
Realised
gain/ Realised
Market (loss) (loss)/gain
value at Disposal against during the
Cost 01/03/19 proceeds cost year
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Rapid Charge
Grid
Limited* 472 472 472 -- --
MatsSoft
Limted -- -- 227 227 227
MEL Topco
Limited (t/a
Maplin) 2,218 -- 98 (2,120) 98
Skills Matter
Limited* 68 -- 68 -- 68
Senselogix
Limited -- 67 -- -- (67)
7digital
Group plc 400 1 -- (400) (1)
Total 3,158 540 865 (2,293) 325
----------- ----------- ----------- ---------- ------------
* Loan note repayment
Of the disposals above, MatsSoft Limited was realised in a prior year,
but proceeds were recognised in the current period in excess of the
amounts previously accrued.
The proceeds received in respect of MEL Topco Limited (t/a Maplin) re
ect a further interim distribution in respect of the company's
administration. In addition, MEL Topco Limited (t/a Maplin), which had a
cost of GBP2,218,000 and a market value of nil at 1 March 2019 was
dissolved in December 2019. However, the loss of GBP2,218,000 had
already been recognised as realised in a prior period.
Investment Portfolio
The following investments were held at 29 February 2020:
Valuation % of
movement in portfolio by
Cost Valuation year value
GBP'000 GBP'000 GBP'000
Venture capital
investments (by value)
Sannpa Limited (t/a
Fnatic) 5,946 5,946 -- 5.1%
ContactEngine Limited 2,330 5,093 1,419 4.3%
Dryden Holdings Limited 5,000 4,761 -- 4.1%
Mycs GmbH 3,031 4,103 1,072 3.5%
Zoovu Limited (formerly
Smart Assistant) 3,653 3,566 (2,533) 3.0%
D30 Holdings Ltd** 3,550 3,439 82 2.9%
Thread, Inc. 3,309 3,302 (32) 2.8%
Written Byte Ltd (t/a
DeepCrawl) 1,612 3,177 983 2.7%
Papier Ltd 3,150 3,150 -- 2.7%
In nity Reliance
Limited (t/a My 1st
Years) 2,769 3,126 (919) 2.7%
Sealskinz Holdings
Limited** 3,116 3,116 (1,315) 2.7%
Our Path Ltd (t/a
Second Nature) 2,800 2,800 -- 2.4%
Response Tap Limited 1,440 2,597 123 2.2%
Arctic Shores Limited 2,450 2,450 -- 2.1%
Festicket Ltd 2,289 2,289 -- 1.9%
Poq Studio Ltd 3,348 2,084 (3,014) 1.8%
Been There Done That
Global Limited 1,448 2,044 596 1.7%
MPB Group Limited 1,489 1,849 360 1.6%
Lupa Foods Limited
(formerly Donatantonio
Group Limited) 1,003 1,801 167 1.5%
Aistemos Limited 1,681 1,679 (2) 1.4%
Litch eld Media Limited 1,420 1,614 (52) 1.4%
Blis Media Limited** 1,083 1,547 (2,130) 1.3%
Access Systems. Inc. 1,500 1,500 -- 1.3%
Stylescape Limited (t/a
EDITED) 1,500 1,500 -- 1.3%
Picasso Labs. Inc. 1,470 1,470 -- 1.3%
Monica Vinader
Limited** 204 1,456 190 1.2%
Rapid Charge Grid
Limited** 1,416 1,213 (140) 1.0%
Disposable Cubicle
Curtains Limited (t/a
Hygenica)** 3,286 1,200 (1,157) 1.0%
Honeycomb.TV Limited 1,100 1,073 6 0.9%
Exonar Limited 1,070 931 (139) 0.8%
Simplestream Limited** 690 815 106 0.7%
Fire y Learning Limited 857 630 (249) 0.5%
71,010 77,321 (6,578) 65.8%
Other venture capital
investments 13,208 443 (3,504) 0.4%
------- --------- ---------------- ---------------
Total venture capital
investments 84,218 77,764 (10,082) 66.2%
Cash at bank and in
hand 39,789 33.8%
---------------
Total investments 117,553 100.0%
--------- ---------------
Valuation movement in the year excludes the cost of investments made in
the year. Other venture capital investments at 29 February 2020
comprise:
Buckingham Gate Financial Services Limited, Cogora Group Limited,
Duncannon Holdings Limited* , InContext Solutions Limited, Inskin Media
Limited, Lantum Limited, Netcall, Senselogix Limited, Skills Matter
Limited**, Utility Exchange Online Limited (t/a SwitchmyBusiness.com),
Whistle Sports, Inc., TVPlayer Limited and Vigilant Applications
Limited*.
* Non-qualifying investment
** Partially non-qualifying investment
Investee company 100% owned by the Company but not consolidated as held
exclusively for resale as part of an investment portfolio.
With the exception of Netcall plc which is quoted on AIM, all venture
capital investments are unquoted.
All venture capital investments are registered in England and Wales
except for InContext Solutions, Inc., Picasso Labs Inc., Whistle Sports,
Inc., Access Systems, Inc., Deepcrawl Holdings, Inc. and Thread, Inc.,
which are Delaware registered corporations in the United States of
America and Mycs GmbH, which is registered in Germany.
Strategic Report
The Directors present the Strategic Report for the year ended 29
February 2020. The Board prepared this report in accordance with the
Companies Act 2006 (Strategic Report and Directors' Reports) Regulations
2013.
Principal objectives and strategy
The Company's investment objective is to achieve long-term returns
greater than those available from investing in a portfolio of quoted
companies, by investing in:
-- a portfolio of carefully selected qualifying investments
in small and medium sized unquoted companies with excellent growth
prospects; and
-- a portfolio of non-qualifying investments permitted for
liquidity management purposes
within the conditions imposed on all VCTs and to minimise the risk of
each investment and the portfolio as a whole.
The Company has been approved by HM Revenue and Customs ("HMRC") as a
Venture Capital Trust in accordance with Part 6 of the Income Tax Act
2007 and, in the opinion of the Directors, the Company has conducted its
a airs so as to enable it to continue to maintain approval. Approval for
the year ended 29 February 2020 is subject to review should there be any
subsequent enquiry under corporation tax self-assessment.
The Directors consider that the Company was not, at any time, up to the
date of this report, a close company within the meaning of Section 414
of the Income and Corporation Taxes Act 1988.
Business model
The business acts as an investment company, investing in a portfolio of
carefully selected smaller companies. The Company operates as a Venture
Capital Trust to ensure that its Shareholders can benefit from tax
reliefs available and has outsourced the portfolio management and
administration duties.
Business review and developments
The Company began the year with GBP62.8 million of venture capital
investments and ended with GBP77.8 million spread over a portfolio of 46
companies. 41 of these investments with a value of GBP70.2 million were
VCT qualifying (or part qualifying).
The loss on ordinary activities after taxation for the year was GBP12.3
million comprising a revenue loss of GBP758,000 and a capital loss of
GBP11.6 million. The Ongoing Charges ratio (excluding performance fees)
as calculated in line with the AIC methodology is an Alternative
Performance Measurement used by the Board to monitor expenses. The
Ongoing Charges ratio for the year ended 29 February 2020 was 2.4%
(2019: 2.8%).
The Company's business review and developments during the year are
reviewed further within the Chairman's Statement, the Investment
Manager's Review and Review of Investments.
Investment policy
The Company's investment policy covers several areas as follows:
Qualifying investments
The Company seeks to make investments in VCT-qualifying companies with
the following characteristics:
-- a strong, balanced and well-motivated management team with a proven track
record of achievement;
-- a defensible market position;
-- good growth potential;
-- an attractive entry price for the Company; and
-- a clearly identified route for a profitable realisation within a 3 to 4
year period.
The Company invests in companies at various stages of development,
including those requiring capital for expansion, but not in start-ups or
in management buy-outs or businesses seeking to use funding to acquire
other businesses. Investments are spread across a range of different
sectors.
Other investments
Funds not invested in qualifying investments may be invested in
non-qualifying investments permitted for liquidity management purposes,
which include cash, alternative investment funds ("AIFs") and UCITS
which may be redeemed on no more than 7 days' notice, or ordinary shares
or securities in a company that are acquired on a regulated market.
Borrowings
It is not the Company's intention to have any borrowings. The Company
does, however, have the ability to borrow a maximum amount equal to the
nominal capital of the Company and its distributable and undistributable
reserves (which, as at 29 February 2020, was equal to GBP117 million
(2019: GBP98.5 million)). There are no plans for the Company to borrow
at the current time.
Maximum exposures
No investment will constitute more than 15% of the Company's portfolio
by value at the time of investment.
Listing Rules
In accordance with the Listing Rules:
1. the Company may not invest more than 10%, in aggregate, of the value of
the total assets of the Company at the time an investment is made in
other listed closed-ended investment funds except listed closed-ended
investment funds which have published investment policies which permit
them to invest no more than 15% of their total assets in other listed
closed-ended investment funds;
2. the Company must not conduct any trading activity which is significant in
the context of the Company; and
3. the Company must, at all times, invest and manage its assets in a way
which is consistent with its objective of spreading investment risk and
in accordance with its published investment policy set out in this
document. This investment policy is in line with Chapter 15 of the
Listing Rules and Part 6 Income Tax Act 2007.
Venture capital trust regulations
The Company has engaged Philip Hare & Associates LLP to advise it on
compliance with VCT requirements, including evaluation of investment
opportunities as appropriate and regular review of the portfolio.
Although Philip Hare & Associates LLP works closely with the Investment
Manager, they report directly to the Board.
Compliance with the main VCT regulations as at 29 February 2020 and for
the year then ended is summarised as follows:
(i) The Company holds at least 70 per cent. of its Complied
investments in qualifying companies (as defined by
Part 6 of the Income Tax Act 2007)
(ii) At least 70 per cent. in the case of funds raised Complied
after 5 April 2011 of the Company's qualifying investments
(by value) are held in "eligible shares" -- ("eligible
shares" generally being ordinary share capital)
(iii) At least 10 per cent. of each investment in Complied
a qualifying company is held in "eligible shares"
(by cost at time of investment)
(iv) No investment in a company constitutes more than Complied
15 per cent. of the Company's portfolio (by value
at time of investment)
(v) The Company's income for each financial year is Complied
derived wholly or mainly from shares and securities
(vi) The Company distributes sufficient revenue dividends Complied
to ensure that not more than 15 per cent. of the income
from shares and securities in any one year is retained
(vii) The Company has not made a prohibited payment Complied
to Shareholders derived from an issue of shares since
6 April 2014
(viii) No investment made by the Company causes an Complied
investee company to receive more than the permitted
investment from State Aid sources (including from
VCTs)
(ix) Since 18 November 2015, the Company has not made Complied
an investment in a company which exceeds the maximum
permitted age requirement
(x) The funds invested by the Company in another company Complied
since 18 November 2015 have not been used to make
a prohibited acquisition
(xi) Since 6 April 2016, the Company has not made Complied
a prohibited non-qualifying investment.
Investment management and administration fees
Beringea provides investment management services to the Company for an
annual fee of 2.0% of the net assets per annum. Beringea is also
entitled to receive performance incentive fees as described below. The
investment management agreement is terminable by either party at any
time by one year's prior written notice. The total fees relating to this
service amounted to GBP2,430,000 (2019: GBP2,414,000), comprising a
management fee of GBP2,430,000 (2019: GBP2,083,000) and performance
incentive fees as described below of GBPnil (2019: GBP331,000). At the
year-end, an amount of GBP194,000 (2019: GBP488,000) was outstanding.
The Board is satis ed with Beringea's approach and procedures in
providing investment management services to the Company. The Directors
have therefore concluded that the continuing appointment of Beringea as
the Investment Manager remains in the best interest of Shareholders.
Throughout the year ended 29 February 2020 Beringea also provided
administration services to the Company. In the year, total
administration fees amount to GBP54,000 (2019: GBP54,000 ). An amount of
GBP14,000 (2019: GBP14,000) remained outstanding at the year end.
The annual running costs (excluding any performance fees payable) of the
Company, are also subject to a cap of 3.6% of the Company's net assets
as at the end of the year. Any costs in excess of this are borne by
Beringea.
Beringea also received arrangement fees in respect of investments made
by the Company and other VCTs managed by Beringea totalling GBP348,000
(2019: GBP361,000) and monitoring fees of GBP364,000 (2019: GBP506,000)
during the year ended 29 February 2020. These fees are payable by the
investee companies into which the Company invests and are not a direct
liability or expense of the Company.
Performance incentive fees
Under the performance fee arrangements, the Investment Manager is
entitled to receive a performance fee in relation to each major
fundraising (a "Respective O er") providing that, at the end of a
nancial year, the relevant Respective O er Performance Value exceeds the
relevant Respective O er Hurdle. In this event the performance fee per
Respective O er Share will be equal to 20 per cent, of the amount by
which each such Respective O er Performance Value exceeds the relevant
Respective O er Initial Net Asset Value per Share, less the aggregate
amount of any performance fee per Respective O er Share already paid in
respect of that Respective O er for nancial years starting after 29
February 2012.
The relevant Respective O er Performance Value in respect of the
relevant nancial year end is the sum of (i) the audited net asset value
per Ordinary Share for a Respective O er at that date, (ii) Respective O
er Cumulative Dividends, and (iii) all performance fees per Ordinary
Share paid by the Shareholders of the Respective O er in relation to
nancial years starting after 29 February 2012.
The Respective O er Hurdle is the greater of (i) 1.25 times the
Respective O er Initial Net Asset Value per Share and (ii) the
Respective O er Initial Net Asset Value per Share increased by the Bank
of England base rate plus one per cent, per annum (compound) from:
-- 31 August 2012, in respect of the Original O er; or
-- the date of the rst allotment of Ordinary Shares under
each Subsequent O er, in respect of all Subsequent O ers.
If at the end of a nancial year the relevant Respective O er Performance
Value is less than or equal to the relevant Respective O er Hurdle, no
performance fee will be payable for such Respective O ers for that
nancial year.
The performance fee per Respective O er Share payable in relation to a
Respective O er for a nancial year will be reduced, if necessary, to
ensure that (i) the cumulative performance fee per Respective O er Share
payable in respect of a Respective O er does not exceed 20 per cent, of
the relevant Respective O er Cumulative Dividends, (ii) the cumulative
performance fee per Respective O er Share payable in respect of the
Respective O er does not exceed 50 per cent, of the amount by which the
relevant Respective O er Performance Value exceeds the relevant
Respective O er Hurdle and (iii) the audited net asset value per
Ordinary Share at the relevant nancial year end plus the relevant
Respective O er Cumulative Dividends is at least equal to the relevant
Respective O er Hurdle.
Performance fees for the year ended 29 February 2020 amounted to GBPnil
(2019: GBP331,000), of which GBPnil (2019: GBP331,000) was outstanding
at the year-end.
Key performance indicators
At each Board meeting, the Directors consider a number of performance
measures to assess the Company's success in meeting its objective of
delivering long term returns. The key performance indicators for the
Company are compared against the results published by the Association of
Investment Companies ("AIC"). The Board believes the Company's key
performance indicators are:
-- Total return (net asset value plus dividends paid since
launch);
-- Dividends paid and the dividend yield; and
-- Net asset value per share (adjusted for dividends paid
in the year).
The total return is calculated by the net asset value per share plus the
cumulative dividends paid to date. This is a performance measure of the
fund and used to evaluate the total value generated for Shareholders.
The following table shows the total return, annual return shown as the
net asset value per share, dividends paid per annum and the dividend
yield.
29/02/2016 28/02/2017 28/02/2018 28/02/2019 29/02/2020
Total return 115.6 124.3 126.5 129.3 123
Net asset value per share (adjusted for dividends
paid in the year)* (1.4%) 10.9% 2.7% 3.9% (9.2%)
Dividends paid per share 4.5 6 12.8 6.5 3.5
Dividend yield** 5.3% 7.5% 15.5% 9.0% 5.1%
* Calculated as the change in total return in the year divided by the
opening net asset value.
** Calculated as the total dividends paid in the year divided by the
opening net asset value.
The net asset value per share is de ned as an Alternative Performance
Measure and the Board considers it to be the primary measure of
shareholder value.
The key performance indicators are discussed further in the Chairman's
Statement and the Investment Manager's Review.
Principal risks and uncertainties
The principal nancial risks faced by the Company, which include market
price risk, interest rate risk, credit risk and liquidity risk (being
minimal), are summarised within the notes to the nancial statements.
In addition to these risks, the Company, as a fully listed Company on
the London Stock Exchange and as a venture capital trust, operates in a
complex regulatory environment and, therefore, also faces a number of
non- nancial principal risks. A breach of the VCT Regulations could
result in the loss of VCT status and consequent loss of tax reliefs
currently available to Shareholders and the Company being subject to
capital gains tax. Serious breaches of other regulations, such as the
Listing Rules of the Financial Conduct Authority and the Companies Act
2006, could lead to suspension from the Stock Exchange and damage to the
Company's reputation.
The Company invests in small and immature businesses and there is a risk
that the performance of these individual businesses negatively impacts
the performance of the Company. The Investment Manager follows a
rigorous process in vetting and careful structuring of new investments
and, after an investment is made, close monitoring of the businesses.
The Board reviews and agrees policies for managing each of these risks.
The Directors receive reports annually from the Investment Manager on
the compliance of systems to manage these risks, and place reliance on
the Investment Manager to give updates in the intervening periods.
Save for the impact of the Coronavirus pandemic, particularly on
performance and valuation of portfolio companies as well as potential
risks such as future fundraising, the risks faced by the Company have
remained unchanged since the beginning of the nancial year.
Viability statement
The Board has assessed the Company's prospects over the three year
period to 28 February 2023. A three year period has been considered
appropriate as it broadly aligns with the time frame during which the
Investment Manager will be required to invest 80% of the funds from the
most recent o er for subscription in qualifying investments.
In order to support this statement, the Board has carried out a robust
assessment of the principal and emerging risks faced by the Company, as
detailed above, including those risks associated with the Coronavirus
pandemic and Brexit, and considered the availability of mitigating
factors.
The Board considers that the primary risk faced by the Company is
compliance with the VCT rules and although there are a number of
mitigating factors such as a robust deal identi cation and diligence
process, an experienced investment team and consultation with the
Company's VCT status adviser to ensure that investments made comply with
the VCT rules, these factors cannot mitigate the risk that insu cient
qualifying investments are identi ed to ensure ongoing compliance with
the VCT rules.
Accordingly, the amount required to invest in qualifying holdings to
maintain compliance with the VCT rules was a major consideration in the
Board's analysis. Together with the expected liabilities of the Company
for the three years to 28 February 2023, the Board considered the
forecast cash requirements against the expected cash position, taking
into account a level of assumed investment realisations and investment
income during the period. The Board considered scenario analysis with
stress tests on the cash ow forecasts.
Based on the assessment of the above considerations on the cash ow
forecasts, the Board has determined that the Company will be able to
continue in operation, maintain compliance with the VCT rules and meet
its liabilities as they fall due for the three years to 28 February
2023.
Section 172 Statement
Section 172 of the Companies Act 2006 requires the Directors of the
Company to act in a way that they consider, in good faith, will most
likely promote the success of the Company for the bene t of the members
as a whole. In doing so, the Directors should have regard (amongst other
matters) to:
-- the likely consequences of any decision in the long
term;
-- the interests of the Company's employees;
-- the need to foster the Company's business relationships
with suppliers, customers and others;
-- the impact of the Company's operations on the community
and the environment;
-- the desirability of the Company maintaining a reputation
for high standards of business conduct; and
-- the need to act fairly as between members of the
Company.
The Board considers its signi cant stakeholder groups to be its
Shareholders, its suppliers (including the Investment Manager to whom
most executive functions are delegated) and its portfolio companies. The
Company is an externally managed investment company with no employees
and no customers in the traditional sense and, therefore, there is
nothing to report in relation to these relationships. The Company takes
a number of steps to understand the views of its key stakeholders and
considers these, along with the matters set out above, in Board
discussions and decision making.
Shareholders
The Company's Shareholders are key to the success of the Company and the
Board engages and communicates with Shareholders by various means. The
Company encourages all Shareholders to attend its annual Shareholder Day,
which last year was held on 13 November 2019 and attended by around 250
Shareholders, and gives Shareholders the opportunity to ask questions of
the Board and the Investment Manager and also hear from some of our
portfolio companies. Given the Coronavirus pandemic, the Company is
putting in place arrangements for the 2020 Shareholder Day to be held
virtually so that our Shareholders will still be given the opportunity
to engage with the Board and Investment Manager and hear from some of
our new portfolio companies.
The Board also encourages all Shareholders to vote on the resolutions at
the Annual General Meeting. The Company's Annual General Meeting, this
year on 10 August 2020, is typically used as another opportunity to
communicate with Shareholders. However, as detailed in the Chairman's
statement, in light of the current Coronavirus 'social distancing'
measures in England, the AGM will be run as a closed meeting and
Shareholders will not be able to attend this year. However, Shareholders
are still strongly encouraged to submit their votes by proxy.
Shareholders will also be able to submit questions via email to
info@beringea.co.uk by 5:00 pm on Monday 3 August 2020. Answers to the
themes in the questions received will be addressed on the website at
https://www.provenvcts.co.uk/.
As a result of the Shareholder events, together with other
communications with Shareholders and advisors, the Company has received
useful feedback which allows the Board to better understand the nature
of stakeholder concerns. The Board works very closely with the
Investment Manager in reviewing how stakeholder issues are handled,
ensuring good governance and responsibility in managing the Company's a
airs. Ultimately, the Directors' decisions are intended to achieve the
Company's principle objective to achieve long term returns for
Shareholders greater than those available from investing in a portfolio
of quoted companies. In addition, the Board has continued to maintain
the existing arrangements for payments of dividends, dividend
re-investment and buy-backs in order to give predictable income returns
and liquidity to Shareholders when requested.
Suppliers
The Company's suppliers, and in particular Beringea as Investment
Manager, are the cornerstone of the Company's business. There is regular
contact with the Investment Manager and members of the Investment
Manager's senior management team attend all of the Company's Board
meetings. Since the outbreak of the Coronavirus pandemic, the Board has
been in more frequent communication with the Investment Manager to
ensure an appropriate and transparent response.
Portfolio Companies
The Investment Manager provides updates to the Board on the entire
portfolio at least quarterly and this has happened more regularly with
the outbreak of the Coronavirus pandemic. In addition to the Investment
Manager's usual monitoring of portfolio companies, in the weeks
immediately following the start of the outbreak in Europe, the
Investment Manager worked closely with the leadership teams of portfolio
companies to ensure that they were prepared for the disruption caused by
a global pandemic. The Investment Manager continues to work closely with
management teams to ensure that they continue to evaluate and react
accordingly to the evolving situation.
Environmental, social, human rights policy and greenhouse emissions
The Board seeks to conduct the Company's a airs responsibly and maintain
high standards in respect of ethical, environmental, governance and
social issues. The Board recognises the requirement under section 414C
of the Companies Act 2006 to detail information about social and
community issues, employees and human rights; including any policies it
has in relation to these matters and e ectiveness of these policies. As
an externally managed investment company with no employees, the Company
has no formal policies in these matters and as such these requirements
do not apply.
On a general note, the Board considers that the Company's investment
operations create employment, aid economic growth, generate tax revenues
and produce wealth, thus bene ting the community and the economy more
generally. Where appropriate, the investment proposals considered by the
Investment Manager and the Board also include any relevant information
on any social, employee, ethical or environmental matters relevant to
that investment.
Whilst as a UK quoted company the VCT is required to report on its
Greenhouse Gas (GHG) Emissions for any direct emissions, as it
outsources all of its activities and does not have any physical assets,
property, employees or operations, it is not responsible for any direct
emissions.
Directors and senior management
The Company had ve non-executive Directors at the year end, three of
whom are male and two of whom are female (and following James Stewart's
retirement after the AGM in August 2020, the Board will consist of an
equal number of male and female directors). The Company has no employees
and the same was true of the previous year.
Directors' remuneration
It is a requirement under Companies Act 2006 for Shareholders to approve
the Directors' remuneration policy every three years or sooner if the
Company wishes to make changes to the policy. The Directors'
remuneration policy was approved at the AGM of the Company on 11 July
2018 and no changes are proposed for the forthcoming year.
Future prospects
The Company's future prospects are set out in the Chairman's Statement
and Investment Manager's Review.
Despite the economic and social disruption caused by the Coronavirus
pandemic, the Directors do not foresee any major changes in the activity
undertaken by the Company in the coming year. The Company continues with
its objective to invest in unquoted companies throughout the United
Kingdom or with a presence in the United Kingdom, with a view to
providing both capital growth and dividend income to Shareholders over
the long term whilst maintaining VCT qualifying status.
By order of the Board
Beringea LLP
Directors' responsibilities statement
The Board considers that the Annual Report and Accounts, taken as a
whole, are fair, balanced and understandable and that they provide the
information necessary for Shareholders to assess the Company's
performance, business model and strategy.
The Directors are responsible for preparing the Annual Report and the
nancial statements in accordance with applicable law and regulations.
They are also responsible for ensuring that the Annual Report and
Accounts includes information required by the Listing Rules of the
Financial Conduct Authority.
Company law requires the Directors to prepare nancial statements for
each nancial year. Under that law, the Directors have elected to prepare
the nancial 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
nancial statements unless they are satis ed that they give a true and
fair view of the state of a airs of the Company and of the pro t or loss
of the Company for that period.
In preparing the nancial statements, the Directors are required to:
-- select suitable accounting policies and then apply them
consistently;
-- make judgments and accounting estimates that are
reasonable and prudent;
-- state whether applicable UK accounting standards have
been followed, subject to any material departures disclosed and
explained in the nancial statements;
-- prepare the nancial statements on the going concern
basis unless it is inappropriate to presume that the Company will
continue in business; and
-- prepare a directors' report, a strategic report and
directors remuneration report which comply with the Companies Act 2006.
The Directors are responsible for keeping adequate accounting records
that are su cient to show and explain the Company's transactions, to
disclose with reasonable accuracy at any time the nancial position of
the Company and to enable them to ensure that the nancial 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 that the Annual Report and
Accounts are made available on a website. Financial statements are
published on the ProVen VCTs' website (www.provenvcts.co.uk), in
accordance with legislation in the United Kingdom governing the
preparation and dissemination of nancial statements, which may vary from
legislation in other jurisdictions. The Directors' responsibility also
extends to the ongoing integrity of the nancial statements contained
therein. The maintenance and integrity of the Company's website is also
the responsibility of the Directors.
Directors' responsibilities pursuant to the Disclosure and Transparency
Rule 4
Each of the Directors, con rms that to the best of each person's
knowledge:
-- the nancial statements, which have been prepared in
accordance with UK Generally Accepted Accounting Practice, give a true
and fair view of the assets, liabilities, nancial position and pro t or
loss of the Company; and
-- the Directors' Report, Chairman's Statement, Strategic
Report, Investment Manager's Review and Review of Investments include a
fair review of the development and performance of the business and the
position of the Company, together with a description of the principal
risks and uncertainties that it faces.
Statement as to disclosure of information to the Auditor
The Directors in o ce at the date of the report have con rmed, as far as
they are aware, that there is no relevant audit information of which the
Auditor is unaware. Each of the Directors con rmed that they have taken
all the steps that they ought to have taken as Directors in order to
make themselves aware of any relevant audit information and to establish
that it has been communicated to the Auditor. This con rmation is given
and should be interpreted in accordance with the provisions of section
418 of the Companies Act 2006.
The Directors' report, which has been approved by the Board, includes
all relevant information required to be disclosed under LR9.8.4R.
Income Statement
for the year ended 29 February 2020
Year ended 28 February
Year ended 29 February 2020 2019
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 430 - 430 355 - 355
Realised gains on
investments - 325 325 - 3,145 3,145
Unrealised
(losses) / gains
on investments - (10,082) (10,082) - 3,375 3,375
430 (9,757) (9,327) 355 6,520 6,875
Investment
management fees (608) (1,822) (2,430) (521) (1,562) (2,083)
Performance
incentive fees - - - - (331) (331)
Other expenses (580) (7) (587) (570) (57) (627)
FX Translation - 30 30
(Loss) / return on
ordinary
activities before
tax (758) (11,556) (12,314) (736) 4,570 3,834
Tax on
ordinary
activities - - - - - -
(Loss) / return
attributable to
equity
shareholders (758) (11,556) (12,314) (736) 4,570 3,834
------- -------- -------- ------- ------- --------
Basic and diluted
(loss) / return
per share (0.4p) (6.2p) (6.6p) (0.5p) 3.2p 2.7p
All revenue and capital movements in the year relate to continuing
operations. No operations were acquired or discontinued during the year.
The total column within the Income Statement represents the Income
Statement of the Company, prepared in accordance with the accounting
policies detailed in note 1 to the nancial statements. The supplementary
revenue and capital columns are presented for information purposes in
accordance with the Statement of Recommended Practice issued by the
Association of Investment Companies.
A Statement of Comprehensive Income has not been prepared as all gains
and losses are recognised in the Income Statement in the current and
prior year as shown.
Other than revaluation movements arising on investments held at fair
value through pro t or loss, there were no di erences between the return
as stated above and at historical cost.
The accompanying notes are an integral part of these nancial statements.
Statement of Changes in Equity
for the year ended 29 February 2020
Year ended 29 February 2020
Called
up Capital Share Capital
share redemption Special Premium Revaluation reserve- Revenue
capital reserve reserve reserve reserve realised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- ---------- ------- ------- ----------- --------- ------- ---------
At 1 March 2019 2,331 19 70,856 946 7,043 19,050 (1,772) 98,473
-------- ---------- ------- ------- ----------- --------- ------- ---------
Comprehensive
Income for the
year:
Management fees
allocated as
capital
expenditure -- -- -- -- -- (1,822) -- (1,822)
Legal fees
allocated as
capital
expense -- -- -- -- -- (7) -- (7)
Realised gain on
investments -- -- -- -- -- 325 -- 325
Unrealised loss
on investments -- -- -- -- (10,082) -- -- (10,082)
Loss after tax -- -- -- -- -- -- (758) (758)
Performance fee -- -- -- -- -- -- -- --
-------- ---------- ------- ------- ----------- --------- ------- ---------
Total
comprehensive
loss -- -- -- -- (10,082) (1,504) (758) (12,344)
Contributions by
and
distributions to
owners:
Issue of new
shares 947 -- (1,539) 39,820 -- -- -- 39,228
Share buybacks (39) 39 (1,464) -- -- -- -- (1,464)
Dividends paid
(includes
DRIS) -- -- (6,689) -- -- -- -- (6,689)
-------- ---------- ------- ------- ----------- --------- ------- ---------
Total
contributions
by and
distributions
to owners 908 39 (9,692) 39,820 -- -- -- 31,075
Other movements:
Transfer of
previously
unrealised
gains now
realised -- -- -- -- 1,879 (1,879) -- --
FX translation -- -- -- -- -- -- 30 30
-------- ---------- ------- ------- ----------- --------- ------- ---------
Total other
movements -- -- -- -- 1,879 (1,879) 30 30
At 29 February
2020 3,239 58 61,164 40,766 (1,160) 15,667 (2,500) 117,234
-------- ---------- ------- ------- ----------- --------- ------- ---------
Year ended 28 February 2019
Called
up Capital Share Capital
share redemption Special Premium Revaluation reserve- Revenue
capital reserve reserve reserve reserve realised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- ---------- -------- -------- ----------- --------- --------- ---------
At 1 March 2018 2,330 1,168 9,970 69,935 10,080 11,443 (1,036) 103,890
-------- ---------- -------- -------- ----------- --------- --------- ---------
Comprehensive
Income for the
year:
Management fees
allocated as
capital
expenditure -- -- -- -- -- (1,562) -- (1,562)
Legal fees
allocated as
capital
expense -- -- -- -- -- (57) -- (57)
Realised gain on
investments -- -- -- -- -- 3,145 -- 3,145
Unrealised gain
on investments -- -- -- -- 3,375 -- -- 3,375
Loss after tax -- -- -- -- -- -- (736) (736)
Performance fee -- -- -- -- -- (331) -- (331)
-------- ---------- -------- -------- ----------- --------- --------- ---------
Total
comprehensive
profit -- -- -- -- 3,375 1,195 (736) 3,834
Contributions by
and
distributions to
owners:
Issue of new
shares 32 -- -- 1,356 -- -- -- 1,388
Share buybacks (31) 31 (1,321) -- -- -- -- (1,321)
Dividends paid
(includes
DRIS) -- -- (9,318) -- -- -- -- (9,318)
-------- ---------- -------- -------- ----------- --------- --------- ---------
Total
contributions
by and
distributions
to owners 1 31 (10,639) 1,356 -- -- -- (9,251)
Other movements:
Transfer of
previously
unrealised
gains now
realised -- -- -- -- (6,412) 6,412 -- --
Cancellation of
share premium
account -- -- 70,345 (70,345) -- -- -- --
Cancellation of
capital
redemption
reserve -- (1,180) 1,180 -- -- -- -- --
-------- ---------- -------- -------- ----------- --------- --------- ---------
Total other
movements -- (1,180) 71,525 (70,345) (6,412) 6,412 -- --
At 28 February
2019 2,331 19 70,856 946 7,043 19,050 (1,772) 98,473
-------- ---------- -------- -------- ----------- --------- --------- ---------
The special reserve, capital reserve -- realised and revenue reserve are
all distributable reserves. Reserves available for distribution
therefore amount to GBP74,331,000 (2019: GBP88,134,000).
During the year the Company repurchased 2,442,467 shares (2019:
1,929,510) with a nominal value of GBP39,213 (2019: GBP31,000). All
shares were subsequently cancelled.
The composition of each of these reserves is explained below:
Called up share capital - The nominal value of shares issued, increased
for subsequent share issues either via an offer for subscription or the
Company's dividend reinvestment scheme, or reduced due to shares bought
back by the Company for cancellation.
Capital redemption reserve - The nominal value of shares bought back and
cancelled.
Special reserve -- A distributable reserve which is used to fund shares
bought back by the Company for cancellation and share issue costs on
shares issued under an offer for subscription. Dividends that are
classified as capital may be paid from this reserve.
Share premium reserve - This reserve contains the excess of gross
proceeds over the nominal value of shares allotted under offers for
subscription and the Company's dividend reinvestment scheme, to the
extent that it has not been cancelled.
Share capital to be issued -- This reserve contains the amount that has
been raised under open offers for subscription, but which at the
relevant period end had not been allotted.
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, all such movements through both revaluation and capital
reserve -- realised are shown within the Income Statement for the year.
Capital reserve realised - The following are accounted for in this
reserve:
-- Gains and losses on realisation of investments;
-- Permanent diminution in value of investments;
-- Transaction costs incurred in the acquisition of investments;
-- 75% of the investment manager's fee expense and 100% of any performance
incentive fee payable; and
-- Other capital expenses and charges.
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 dividends paid that are classified as revenue in nature.
Statement of Financial Position
as at 29 February 2020
29 February 2020 28 February 2019
Fixed assets GBP'000 GBP'000
Investments 77,763 62,769
Current assets
Debtors 829 481
Cash at bank and in hand 39,789 36,380
---------------- ----------------
40,618 36,861
Creditors: amounts falling due
within one year (1,147) (1,157)
Net current assets 39,471 35,704
Total assets less current
liabilities 117,234 98,473
---------------- ----------------
Capital and reserves
Called up share capital 3,239 2,331
Capital redemption reserve 58 19
Special reserve 61,164 70,856
Share premium 40,766 946
Revaluation reserve (1,160) 7,043
Capital reserve -- realised 15,667 19,050
Revenue reserve (2,500) (1,772)
Total equity shareholders' funds 117,234 98,473
---------------- ----------------
Basic and diluted net asset value 58.6p 68.4p
per share
Statement of Cash Flows
for the year ended 29 February 2020
Year ended
29 Year ended
February 28 February
2020 2019
Total Total
GBP'000 GBP'000
(Loss)/return on ordinary activities before
taxation (12,314) 3,834
Loss/(Gain) on investments 9,757 (6,520)
Increase in prepayments, accrued income and other
debtors (318) (68)
Decrease in accruals and other creditors (240) (782)
---------- -----------
Net cash used in operating activities (3,115) (3,536)
---------- -----------
Cash flows from investing activities
Purchase of investments (25,616) (9,900)
Sale of investments 835 14,741
---------- -----------
Net cash from investing activities (24,781) 4,841
---------- -----------
Cash flows from financing activities
Proceeds from share issues 39,735 --
Share issue costs (1,539) --
Purchase of own shares (1,230) (1,057)
Equity dividends paid (5,661) (7,930)
Net cash used in financing 31,305 (8,987)
---------- -----------
Increase/(decrease) in cash and cash equivalents 3,409 (7,682)
---------- -----------
Cash at beginning of year 36,380 44,062
---------- -----------
Cash at end of year 39,789 36,380
---------- -----------
'Net cash used in operating activities' includes interest received of
GBP273,000, (2019: GBP284,000) and dividends received of GBP 4,000
(2019: GBPnil). No interest was paid during the year.
Notes to the Announcement
for the year ended 29 February 2020
1 Accounting policies
Basis of preparation
The Company has prepared its nancial statements under Financial
Reporting Standard 102 ("FRS102") and in accordance with the Statement
of Recommended Practice 'Financial Statements of Investment Trust
Companies and Venture Capital Trusts' (the "SORP") issued by the
Association of Investment Companies ("AIC"), which was revised in
December 2018.
The nancial statements are prepared under the historical cost convention
except for the revaluation of certain nancial instruments measured at
fair value.
The following accounting policies have been applied consistently
throughout the period.
Going concern
The Directors have, at the time of approving the nancial statements, a
reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. Thus they
continue to adopt the going concern basis of accounting in preparing the
nancial statements.
Presentation of Income Statement
In order to better re ect the activities of an investment company and,
in accordance with guidance issued by the 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 return attributable to equity shareholders is the measure the
Directors believe appropriate in assessing the Company's compliance with
certain requirements set out in Part 6 of the Income Tax Act 2007.
Investments
Investments, including equity and loan stock, are recognised at their
trade date and measured at "fair value through pro t or loss" due to
investments being managed and performance evaluated on a fair value
basis. A nancial asset is designated within this category if it is both
acquired and managed, with a view to selling after a period of time, in
accordance with the Company's documented investment policy. The fair
value of an investment upon acquisition is deemed to be cost. Thereafter
investments are measured at fair value in accordance with International
Private Equity and Venture Capital Valuation Guidelines ("IPEV
Guidelines") issued in December 2018, together with sections 11 and 12
of FRS102.
Publicly traded investments are measured using bid prices in accordance
with the IPEV Guidelines.
Key judgements
The valuation methodologies used by the Directors for estimating the
fair value of unquoted investments are as follows:
-- where a company is in the early stage of development, the
estimate of fair value is based on market data and assumptions as to the
potential outcomes, benchmarked against alternative valuation
methodologies during this time;
-- where a company is well established after an appropriate period,
the investment may be valued by applying a suitable earnings or revenue
multiple to that company's maintainable earnings or revenue. The
multiple used is based on comparable listed companies or a sector but
discounted to re ect factors such as the di erent sizes of the
comparable businesses, di erent growth rates and the lack of
marketability of unquoted shares;
-- where a value is indicated by a material arm's-length transaction
by a third party in the shares of the company the valuation will
normally be based on this;
-- where alternative methods of valuation, such as net assets of the
business, are more appropriate then such methods may be used; and
-- where repayment of the equity is not probable, redemption
premiums will be recognised.
The methodology applied takes account of the nature, facts and
circumstances of the individual investment and uses reasonable data,
market inputs, assumptions and estimates in order to ascertain fair
value. Methodologies are applied consistently from year to year except
where a change results in a better estimate of fair value.
Where an investee company has gone into receivership or liquidation, or
the loss in value below cost is considered to be permanent, or there is
little likelihood of a recovery from a company in administration, the
loss on the investment, although not physically disposed of, is treated
as being realised.
All investee companies are held as part of an investment portfolio and
measured at fair value. Therefore, it is not the policy for investee
companies to be consolidated and any gains or losses arising from
changes in fair value are included in the Income Statement for the
period as a capital item.
Gains and losses arising from changes in fair value are included in the
Income Statement for the year as a capital item and transaction costs on
acquisition or disposal of the investment are expensed. Investments are
derecognised when the contractual rights to the cash ows from the asset
expire or the Company transfers the asset and substantially all the
risks and rewards of ownership of the asset to another entity.
Key estimates
The key estimates involved in determining the fair value of a company
can include:
-- identifying a relevant basket of market comparables;
-- deducing the discount to take on those market comparables;
-- determining reoccurring revenue;
-- determining reoccurring earnings; or
-- identifying surplus cash.
Fair value
Fair value is defined as the amount for which an asset could be
exchanged between knowledgeable, willing parties in an arm's length
transaction. The Company has categorised its financial instruments that
are measured subsequent to initial recognition at fair value, using the
fair value hierarchy as follows:
Level 1: The unadjusted quoted price in an active market for identical
assets or liabilities that the entity can access at the measurement
date.
Level 2: Inputs other than quoted prices included within Level 1 that
are observable (i.e., developed using market data) for the asset or
liability, either directly or indirectly.
Level 3: Inputs are unobservable (i.e., for which market data is
unavailable) for the asset or liability.
Income
Dividend income from investments is recognised when the shareholders'
rights to receive payment has been established, normally the ex-dividend
date.
Interest income is accrued on a time basis, by reference to the
principal outstanding and at the effective interest rate applicable and
only where there is reasonable certainty of collection in the
foreseeable future. Income which is not capable of being received within
a reasonable period of time is reflected in the capital value of the
investments. A provision is made for any fixed income not expected to be
received.
Expenses
All expenses are accounted for on an accruals basis. In respect of the
analysis between revenue and capital items presented within the Income
Statement, all expenses have been presented as revenue items except as
follows:
--expenses which are incidental to the acquisition of an investment are
deducted from the Capital Account;
--expenses which are incidental to the disposal of an investment are
deducted from the disposal proceeds of the investment;
--expenses are split and presented partly as capital items where a
connection with the maintenance or enhancement of the value of the
investments held can be demonstrated. Accordingly, the investment
management fee has been allocated 25% to revenue and 75% to capital in
order to reflect the Directors' expected long-term view of the nature of
the investment returns of the Company; and
--performance incentive fees are treated as a capital item.
Taxation
The tax effects of different items in the Income Statement are allocated
between capital and revenue on the same basis as the particular item to
which they relate using the Company's effective rate of tax for the
accounting period.
Due to the Company's status as a venture capital trust and the continued
intention to meet the conditions required to comply with Part 6 of the
Income Tax Act 2007, no provision for taxation is required in respect of
any realised or unrealised appreciation of the Company's investments.
Deferred taxation, which is not discounted, is provided in full on
timing differences that result in an obligation at the balance sheet
date to pay more tax, or a right to pay less tax, at a future date, at
rates expected to apply when they crystallise based on current tax rates
and law.
Timing differences arise from the inclusion of items of income and
expenditure in taxation computations in periods different from those in
which they are included in the financial statements. Deferred tax assets
are recognised to the extent that it is regarded as more likely than not
that they will be recovered.
Share issue costs
Expenses in relation to share issues are deducted from the Special
Reserve.
Cash
Cash comprises cash on hand and demand deposits.
Debtors
Short term debtors are initially measured at transaction price.
Subsequent remeasurement deducts any impairment from the transaction
price.
Creditors
Short term trade creditors are initially and subsequently measured at
the transaction price.
2 Basic and diluted return per share
Year ended 29 February Year ended 28 February
2020 2019
Revenue (loss)/ return
per share based on:
Net revenue loss after
taxation (GBP'000) (758) (736)
Weighted average number
of shares in issue 187,733,719 143,594,091
Pence per share (0.4p) (0.5p)
Capital return per share
based on:
Net capital return for
the financial year
(GBP'000) (11,556) 4,570
Weighted average number
of shares in issue 187,733,719 143,594,091
Pence per share (6.2p) 3.2p
Total return per share
based on:
Total return for the
financial year
(GBP'000) (12,314) 3,834
Weighted average number
of shares in issue 187,733,719 143,594,091
Pence per share (6.6p) 2.7p
As the Company has not issued any convertible securities or share
options, there is no dilutive e ect on return per share. The return per
share disclosed therefore represents both basic and diluted return per
share.
3 Basic and diluted net asset value per share
2020 2019
Shares in issue Net asset value Net asset value
Pence Pence
per per
2020 2019 share GBP'000 share GBP'000
Ordinary
Shares 200,137,231 144,047,261 58.6 117,234 68.4p 98,473
117,234 98,473
-------- --------
As the Company has not issued any convertible securities or share
options, there is no dilutive e ect on net asset value per share. The
net asset value per share disclosed therefore represents both basic and
diluted return per share.
4 Principal risks and management objectives
The Company's investment activities expose the Company to a number of
risks associated with nancial instruments and the sectors in which the
Company invests. The principal nancial risks arising from the Company's
operations are:
-- Market risks;
-- Credit risk; and
-- Liquidity risk.
The Board regularly reviews these risks and the policies in place for
managing them. Save for the economic and social impact of the
Coronavirus pandemic, there have been no signi cant changes to the
nature of the risks that the Company is exposed to over the year and
there have also been no signi cant changes to the policies for managing
those risks during the year.
The risk management policies used by the Company in respect of the
principal nancial risks and a review of the nancial instruments held at
the year-end are provided below:
Market risks
As a VCT, the Company is exposed to market risks in the form of
potential losses and gains that may arise on the investments it holds.
The management of these market risks is a fundamental part of investment
activities undertaken by the Investment Manager and overseen by the
Board. The Investment Manager monitors investments through regular
contact with the management of investee companies, regular review of
management accounts and other nancial information and attendance at
investee company board meetings. This enables the Investment Manager to
manage the investment risk in respect of individual investments. Market
risk is also mitigated by holding a portfolio diversi ed across several
business sectors and asset classes.
The key market risks to which the Company is exposed are:
-- Market price risk; and
-- Interest rate risk.
Market price risk
Market price risk arises from uncertainty about the future prices and
valuations of nancial instruments held in accordance with the Company's
investment objectives. It represents the potential loss that the Company
might su er through market price movements in respect of quoted
investments and also changes in the fair value of unquoted investments
that it holds.
At 29 February 2020, the AIM-quoted portfolio was valued at GBP193,000
(2019: GBP143,000).
The Company's sensitivity to uctuations in the share prices of its
AIM-quoted investments is summarised below. A 20% movement in the share
price of all of the AIM-quoted investments held by the Company would
have an e ect as follows:
20% movement
in AIM-quoted
investments 2020 2019
Impact on net Impact on NAV Impact on net Impact on NAV
assets per share assets per share
GBP'000 Pence GBP'000 Pence
AIM-quoted
investments 38 0.0p 28 0.0p
At 29 February 2020, the unquoted portfolio was valued at GBP77,570,000
(2019: GBP60,626,000).
As many of the Company's unquoted investments are valued using revenue
or earnings multiples of comparable companies or sectors, a fall in
share prices generally would impact on the valuation of the unquoted
portfolio. A 20% movement in the valuations of all of the unquoted
investments held by the Company would have an e ect as follows:
20% movement in unquoted
investment valuations 2020 2019
Impact on net Impact on NAV Impact on net Impact on NAV
assets per share assets per share
GBP'000 Pence GBP'000 Pence
Unquoted
investments 15,514 7.8p 12,526 8.6p
The sensitivity analysis for unquoted valuations above assumes that each
of the sub-categories of nancial instruments (ordinary shares,
preference shares and loan stocks) held by the Company produces an
overall movement of 20%. Shareholders should note that equal correlation
between these sub-categories is unlikely to be the case in reality,
particularly in the case of loan stock instruments. Where share prices
are falling, the equity instrument could fall in value before the loan
stock instrument. It is not considered practical to assess the
sensitivity of the loan stock instruments to market price risk in
isolation.
Interest rate risk
The Company is exposed to interest rate risk on floating-rate financial
assets through the effect of changes in prevailing interest rates. The
Company receives interest on its cash deposits at a rate agreed with its
bankers. Investments in loan stock attract interest predominantly at
fixed rates. A summary of the interest rate profile of the Company's
financial instruments is shown below.
There are three categories in respect of interest which are attributable
to the financial instruments held by the Company as follows:
-- "Fixed rate" assets represent investments with predetermined yield
targets and comprise certain loan note investments.
-- "Floating rate" assets predominantly bear interest at rates linked to
Bank of England base rate or LIBOR and comprise cash at bank and certain
loan note investments.
-- "No interest rate" assets do not attract interest and comprise equity
investments, certain loan note investments, loans and receivables
(excluding cash at bank) and other financial liabilities.
Average Average period 2020 2019
interest rate until maturity GBP'000 GBP'000
Fixed rate 7.1% 352 days 16,237 15,333
Floating rate 0.3% 0 days 39,847 36,498
No interest rate 61,150 46,642
------- -------
117,234 98,473
------- -------
The Company monitors the level of income received from xed, oating and
non-interest bearing assets and, if appropriate, may make adjustments to
the allocation between the categories, in particular should this be
required to ensure compliance with the VCT regulations.
Based on the assumption that the yield of all oating rate nancial
instruments would change by an amount equal to the movement in
prevailing interest rates, it is estimated that an increase of 1% in
interest rates would have increased total return before taxation for the
year by GBP399,000 (2019: GBP365,000). Given the low level of interest
rates through the year, a further decrease in interest rates is not
considered likely.
Credit risk
Credit risk is the risk that a counterparty to a nancial instrument is
unable to discharge a commitment to the Company made under that
instrument. The Company is exposed to credit risk through its
investments in cash deposits and debtors. Credit risk relating to loan
stock investee companies is considered to be part of market risk.
The Company is exposed to credit risk as follows:
2020 2019
GBP'000 GBP'000
Cash and cash equivalents 39,789 36,380
Interest, dividends and other receivables 524 423
------- -------
40,313 36,803
------- -------
The management of credit risk associated with interest, dividends and
other receivables is covered within the investment management
procedures.
Cash is mainly held by the Royal Bank of Scotland plc, rated BBB+ and A+
by Standard and Poor's and Fitch, respectively, and is also ultimately
part-owned by the UK Government. Consequently, the Directors consider
that the risk pro le associated with cash deposits is low.
There have been no changes in fair value during the year that are
directly attributable to changes in credit risk.
Liquidity risk
Liquidity risk is the risk that the Company encounters di culties in
meeting obligations associated with its nancial liabilities. Liquidity
risk may also arise from either the inability to sell nancial
instruments when required at their fair values or from the inability to
generate cash in ows as required. The Company maintains a relatively low
level of creditors (GBP1,147,000 at 29 February 2020) and has no
borrowings.
The Company always holds su cient levels of funds as cash in order to
meet expenses and other cash out ows as required. For these reasons, the
Board believes that the Company's exposure to liquidity risk is minimal.
The Company's liquidity risk is managed by the Investment Manager in
line with guidance agreed with the Board and is reviewed by the Board at
regular intervals.
Although the Company's investments are not held to meet the Company's
liquidity requirements, the table below shows an analysis of the loan
notes, highlighting the length of time that it could take the Company to
realise its loan stock assets if it were required to do so.
The carrying value of loan stock investments (as opposed to the
contractual cash ows) at 29 February 2020 as analysed by expected
maturity date is as follows:
Not later Between Between Between More
than 1 1 and 2 2 and 3 3 and 5 than Total
years years years years 5 years Total
As at 29 February 2020 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Fully performing loan
stock 10,909 -- -- 314 4,004 15,227
Past due loan stock -- -- -- -- 1,068 1,068
--------- ------- ------- ------- ------- -------
10,909 -- -- 314 5,072 16,295
--------- ------- ------- ------- ------- -------
As at 28 February 2019
Fully performing loan
stock 1,113 13,094 -- 291 -- 14,498
Past due loan stock -- -- -- 953 -- 953
--------- ------- ------- ------- ------- -------
1,113 13,094 -- 1,244 -- 15,451
--------- ------- ------- ------- ------- -------
Of the loan stock classi ed as "past due" above, GBP1,068,000 relates to
the principal of loan notes where the principal has passed its maturity
date.
Fair Value of Financial Instruments
Fair value measurements recognised in the balance sheet
Investments are valued at fair value as determined using the measurement
policies described in note 1. The carrying value of financial assets and
liabilities recorded at amortised cost, which includes short term
debtors and creditors, is considered by Directors to be equivalent to
their fair value.
The Company has categorised its financial instruments that are measured
subsequent to initial recognition at fair value, using the fair value
hierarchy as follows:
Level 1 Reflects financial instruments quoted in an active
market.
Level 2 Reflects financial instruments that have been valued
using inputs, other than quoted prices, that are observable.
Level 3 Reflects financial instruments that have been valued
using valuation techniques with unobservable inputs.
2020 2019
Level
Level 1 Level 2 Level 3 Total Level 1 Level 2 3 Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
AIM quoted 193 -- -- 193 143 -- -- 143
Loan notes -- -- 16,295 16,295 -- -- 15,451 15,451
Unquoted
investments -- -- 61,275 61,275 -- -- 47,175 47,175
------- ------- ------- ------- ------- ------- ------ -------
193 -- 77,570 77,763 143 -- 62,626 62,769
------- ------- ------- ------- ------- ------- ------ -------
There have been no movements between levels during the financial year to
29 February 2020.
Reconciliation of fair value for Level 3 financial instruments held at
the year end
Loan Notes Unquoted equity Total
GBP'000 GBP'000 GBP'000
Balance at 1 March 2019 15,451 47,175 62,626
---------- --------------- -------
Movements in the income statement:
Gains in the income statement (2,688) (7,118) (9,806)
---------- --------------- -------
Purchases at cost 4,004 21,611 25,615
Sales proceeds (472) (393) (865)
Balance at 29 February 2020 16,295 61,275 77,570
---------- --------------- -------
There is an element of judgment in the choice of assumptions for
unquoted investments. If di erent assumptions were used, di erent
valuations could have been attributed to certain of the VCT's
investments.
5 Post balance sheet events
Between 29 February 2020 and the date of this report, the Company issued
24,518,370 Ordinary Shares for an aggregate consideration of GBP14.2
million under the combined o er for subscription with ProVen VCT plc
which launched on 27 January 2020. Share issue costs thereon amounted to
GBP577,000.
In March 2020, the Company invested in two pre-existing portfolio
companies. GBP772,000 was invested in Fnatic and GBP421,000 in Thread.
In the same month, an investment was also made in Commonplace (GBP1.5m),
an online community consultation platform. Subsequent to this, GBP1.35m
was invested in April in Luxury Promise, the leading marketplace to buy,
sell and swap pre loved luxury goods. In June 2020, the Company invested
GBP125,000 in ContactEngine, a pre-existing portfolio company.
Save for the impact of the Coronavirus pandemic, particularly on
performance and valuation of portfolio companies as well as potential
risks such as future fundraising, the risks faced by the Company have
remained unchanged since the beginning of the nancial year.
Announcement based on audited accounts
The financial information set out in this announcement does not
constitute the Company's statutory financial statements in accordance
with section 434 Companies Act 2006 for the year ended 29 February 2020,
but has been extracted from the statutory financial statements for the
year ended 29 February 2020, which were approved by the Board of
Directors on 1 July 2020 and will be delivered to the Registrar of
Companies following the Company's Annual General Meeting. The
Independent Auditor's Report on those financial statements was
unqualified and did not contain any emphasis of matter nor statements
under s 498(2) and (3) of the Companies Act 2006.
The statutory accounts for the year ended 28 February 2019 have been
delivered to the Registrar of Companies and received an Independent
Auditors report which was unqualified and did not contain any emphasis
of matter nor statements under S498(2) and (3) of the Companies Act
2006.
A copy of the full annual report and financial statements for the year
ended 29 February 2020 will be made available to Shareholders shortly.
Copies will also be available for download from
https://www.globenewswire.com/Tracker?data=3aSoHewhtv85eraUrtfiQPDasMnJ33-k56ck79zOxKo2EnUQ0KlLKNVnNzb1r_ZQJW7UNrbd_MkA75y6MnUg1fyG5fARfuv8Q9dxTzgEoz0=
www.provenvcts.co.uk
End
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July 02, 2020 02:46 ET (06:46 GMT)
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