TIDMBMD
RNS Number : 6987X
Baronsmead Second Venture Trust PLC
22 December 2023
Baronsmead Second Venture Trust plc
Annual Report and Audited Financial Statements
for the year ended 30 September 2023
The Directors of Baronsmead Second Venture Trust plc are pleased
to announce the Annual Financial Report for the year ended 30
September 2023. The Annual Report and Financial Statements can be
obtained from the following website: www.baronsmeadvcts.co.uk
Financial Highlights
-- Net Asset Value ("NAV") per share decreased 3.1 per cent to
60.1p, before the deduction of dividends, for the financial year
ended 30 September 2023.
-- NAV total return of 318.5p to shareholders for every 100.0p
invested at launch (January 2001).
-- Annual tax free dividend yield of 7.2 per cent based on 4.5p
dividends paid (including proposed final dividend of 2.25p) and
opening NAV of 62.1p.
-- GBP10.9million of investments made into six new investments
and eight follow-on opportunities during the year.
Our investment objective
Baronsmead Second Venture Trust plc (the "Company") is a tax
efficient listed company which aims to achieve long -- term
positive investment returns for private investors, including tax
free dividends.
Investment policy
-- To invest primarily in a diverse portfolio of UK growth
businesses, whether unquoted or traded on AIM.
-- Investments are made selectively across a range of sectors in
companies that have the potential to grow and enhance their
value.
Dividend policy
-- The Board will, where possible, seek to pay two dividends to
shareholders in each calendar year, typically an interim dividend
in September and a final dividend following the Annual General
Meeting in February/March.
-- The Board will use, as a guide, when setting the dividends
for a financial year, a sum representing 7 per cent of the opening
net asset value of that financial year.
Key elements of the business model
Access to an attractive, diverse portfolio
The Company gives shareholders access to a diverse portfolio of
growth businesses.
The Company will make investments in growth businesses, whether
unquoted or traded on AIM, which are substantially based in the UK
in accordance with the prevailing VCT legislation. Investments are
made selectively across a range of sectors.
The Manager's approach to investing
The Manager endeavours to select the best opportunities and
applies a distinctive selection criteria based on:
-- Primarily investing in parts of the economy which are
experiencing long term structural growth.
-- Businesses that demonstrate, or have the potential for, market leadership in their niche.
-- Management teams that can develop and deliver profitable and sustainable growth.
-- Companies with the potential to become an attractive asset
appealing to a range of buyers at the appropriate time to sell.
In order to ensure a strong pipeline of opportunities, the
Manager invests in building deep sector knowledge and networks and
undertakes significant proactive marketing to interesting target
companies in preferred sectors. This approach generates a network
of potentially suitable businesses with which the Manager maintains
a relationship ahead of possible investment opportunities.
The Manager as an influential shareholder
The Manager is an engaged and supportive shareholder (on behalf
of the Company) in both unquoted and significant quoted
investments.
For unquoted investments, representatives of the Manager often
join the investee board.
The role of the Manager with investees is to ensure that
strategy is clear, the business plan can be implemented and that
the management resources are in place to deliver profitable growth.
The intention is to build on the business model and grow the
company into an attractive target able to be either sold or
potentially floated in the medium term.
STRATEGIC REPORT
CHAIR'S STATEMENT
The economic environment over the past year has remained
challenging. Consumer and business confidence continued to be
affected by high inflation and rising interest rates during the
year, weighing on the value of the Company's unquoted and
AIM-traded investments. As a result, the Company's NAV per share
decreased 2.0p per share (3.1 per cent) before dividend payments
for the year ended 30 September 2023.
The Company aims to achieve long -- term positive investment
returns for its shareholders from a diverse portfolio of
investments in UK growth companies. Despite the difficult
conditions leading to a drop in the value of the portfolio over the
period, the Board continues to believe that, in aggregate, the
fundamentals of the large majority of portfolio companies remain
robust. The Company continues to be in a position to support those
investee companies where the Manager believes there is a strong
prospect of providing good investment returns for shareholders over
the medium to longer term.
Results
Pence per ordinary share
NAV as at 1 October 2022 (after final dividend) 62.08
-------------------------
Valuation decrease (-3.1 per cent) (1.95)
-------------------------
NAV as at 30 September 2023 before dividends 60.13
-------------------------
Less:
Interim dividend paid on 8 September 2023 (2.25)
-------------------------
Proposed final dividend of 2.25p payable, after shareholder approval, on 8 March 2024 (2.25)
-------------------------
Illustrative NAV as at 30 September 2023 after proposed dividend 55.63
-------------------------
Portfolio review
At 30 September 2023, the Company's investment portfolio was
valued at GBP129 million and comprised 82 direct investments, of
which 37 are in unquoted companies and 45 are in quoted companies.
The Company's investments in the WS Gresham House UK Micro Cap Fund
("Micro Cap"), WS Gresham House UK Multi Cap Income Fund ("Multi
Cap Income") and WS Gresham House UK Smaller Companies Fund ("Small
Cap") were valued at GBP63 million at 30 September. These
investments provide investment exposure to an additional 76 AIM --
traded and fully listed companies, spreading investment risk across
a highly diversified portfolio of 158 companies.
The ongoing economic and political difficulties noted in my
opening remarks resulted in the unquoted portfolio decreasing by 15
per cent in value during the year. Clearly, this is a disappointing
result. However, the quoted portfolio proved to be resilient and,
in the face of continued outflows of overall investor capital from
the UK, increased by 3 per cent in value during the year. To put
this in context, the FTSE AIM All Share Index decreased by 9.9 per
cent over the same period, highlighting the challenges faced by
most UK smaller companies.
Investments and divestments
The Board is once again pleased to report that the Company
continues to see attractive opportunities and make new investments.
The Company invested a total of GBP10.9 million in 14 companies
over the year. Further details of the new investments made are
included in the Manager's review. As we have said to shareholders
previously, the requirement to make investments in earlier stage
companies may result in greater volatility of returns over time.
However, the more mature, established portfolio of existing
investments should assist in sustaining returns and dividends for
shareholders, as the newer holdings develop and grow. The priority
for portfolio companies is to operate in a difficult macroeconomic
environment with proactivity and resilience. The Company has the
resources to support new and existing portfolio companies and the
Manager is focusing on the key challenges and opportunities of each
holding.
There was one full realisation in the unquoted portfolio during
the year, with proceeds of GBP0.8 million received from the
realisation of Evotix, for a gross multiple of 0.7x cost. In
addition to this, the Key Travel Loan Notes matured for GBP0.4
million and a gross money multiple of 3.2x cost, along with
deferred earn-out consideration of GBP1.4 million from the sale of
Pho for a gross money multiple of 3.1x cost. The Manager has also
continued its approach of profitable partial realisations of
Cerillion during the year, resulting in the receipt of proceeds of
GBP0.7 million at an aggregate of 15.8x original invested cost in
this listed company.
Dividends
The Board is pleased to declare a final dividend of 2.25p per
share for the year to 30 September 2023, payable on 8 March 2024.
This is in addition to the 2.25p interim dividend paid in September
and means that the total dividends for the year are 4.5p. This is a
7.2 per cent yield based on the opening NAV of 62.1p and meets the
target policy of 7 per cent of the NAV at the start of the year.
Including the proposed final dividend of 2.25p per share, tax free
dividends paid since launch in 2001 now total 164.8p per share,
86.5p of which has been paid over the past 10 years.
Fees
We are happy to announce that with effect from 1st October 2023,
the fee payable to the Investment Manager has been amended so that
the Investment Manager is entitled to receive an annual management
fee of the aggregate of 2.5 per cent per annum of the net assets of
BSVT up to and including GBP209,658,860 (being the total net assets
of BSVT as at 30 September 2023) and 2.0 per cent. per annum of the
amount by which the net assets of BSVT exceed GBP209,658,860,
calculated and paid on a quarterly basis.
Unclaimed Dividends
The Company's Registrar was holding GBP0.8 million in unclaimed
dividends as at 30 September 2023. Of this amount, GBP0.1 million
was unclaimed for over 12 years. Any shareholders who have not been
able to claim their dividends are requested to contact the
Company's Registrar. Their contact details are in the full Annual
Report.
Under the terms of the Company's Articles of Association, any
dividends unclaimed for a period of 12 years after having become
due for payment shall, if the Board so resolves, be forfeited and
shall cease to remain owing by the Company. Additionally, under the
terms of the Company's Articles of Association, I would like to
remind shareholders that it is their responsibility to keep their
address and, for those who receive their dividends by bank
transfer, their bank account details up to date by informing the
Company's Registrar of any changes.
Environmental, Social and Governance ("ESG") matters
Environmental, social and governance analysis is embedded into
the Company's investment processes by the Manager in order to build
and protect long -- term value for investors. A framework based on
ten key ESG themes in each portfolio is used to structure analysis,
monitor and report on ESG risks and opportunities across their
lifecycle. Further information in relation to the Manager's
integration of ESG factors in the management of the Company's
portfolio is in the Strategic Report section of the full Annual
Report.
Loss of tax reliefs Clause
When EU State Aid approval of the UK's VCT and EIS schemes was
given in 2015, a "Sunset Clause" was introduced for the schemes
whereby, in the absence of new or amended legislation, investors
will no longer be able to claim upfront income tax relief on
subscriptions for new VCT shares made after 5 April 2025.
In November 2023, the Chancellor announced in the Autumn
Statement that legislation will be introduced in the Finance Act
2023 to move the effective date of the Sunset Clause to 6 April
2035.
The Board continues to monitor the situation closely and has
taken this into consideration with respect to its planned
fundraising.
Acquisition of the Investment Manager, Gresham House
Further to the announcement on 17 July 2023 of the acquisition
of the Investment Manager by Searchlight Capital Partners L.P., the
acquisition has now completed, and Gresham House plc delisted from
the London Stock Exchange on 20 December 2023, to become a
privately owned company.
The acquisition is expected to have minimal impact on the
Company and business is continuing as usual.
For further information please visit the website link:
https://greshamhouse.com/about/.
Consumer Duty
The Financial Conduct Authority's (FCA) new Consumer Duty
regulation came into effect on 31 July 2023. The Consumer Duty
which sets higher and clearer standards of consumer protection
across financial services and requires all firms to put their
customers' needs first, is an advance on the previous concept of
'treating customers fairly'.
As previously notified, the Company is not regulated by the FCA
and therefore it does not directly fall into the scope of Consumer
Duty. However, Gresham House as the Investment Manager, and any
IFAs or financial platforms used to distribute future fundraising
offers, are subject to Consumer Duty.
The Board will ensure that the principles behind Consumer Duty
are upheld and have worked closely with the Investment Manager on
the information now available to assist consumers and their
advisers to be able to discharge their obligations under Consumer
Duty.
Fundraising
In September 2023, the Board announced its intention to raise
new funds to increase the Company's resources available for new and
follow-on investments over the next two to three years. On 4
December 2023, the Company launched an offer for subscription to
raise GBP15 million (before costs) with an additional GBP10 million
over -- allotment facility available if required. Investing
throughout an economic cycle is a key part of the Company's
investment strategy. The additional funds raised will be deployed
in smaller UK companies, at what the Manager believes to be an
advantageous time.
Annual General Meeting ("AGM")
I look forward to meeting as many shareholders as possible at
the next AGM, to be held at 11.00 am on 5 March 2024. The Company
intends to hold this AGM in person again, however, we will also
live stream the event for any shareholders who do not wish, or are
unable, to attend in person. Registration details for the live
stream will be included in the Notice of AGM and on the Baronsmead
Second Venture Trust website.
Outlook
The geopolitical and economic outlook is expected to remain
challenging, with the impact of higher inflation and interest rates
likely to continue to affect business and consumer confidence for
some time.
We anticipate that these forces will drive periods of sentiment
driven volatility in equity markets well into next year. While we
view this outlook with suitable caution, we also expect heightened
volatility to create attractive long -- term investment
opportunities and we remain vigilant for evidence of mispricing
which can be used to the Company's advantage. We recognise, and are
encouraged by, the additional investment and operational resources
which Gresham House is deploying in the management of your Company
and expect these efforts to provide attractive longer -- term
returns.
Despite these economic headwinds, the portfolio remains highly
diversified and the Board continues to believe it is a good time to
be investing in earlier stage, innovative and high growth potential
businesses. The Manager will be looking to take advantage of
changes in consumer behaviour and the disruption of traditional
supply chains being driven by technology. We remain confident that
the Manager is suitably positioned to provide the necessary levels
of support to the portfolio companies and remains focused on
retaining, recovering and helping to grow value in existing and
future investee companies.
Sarah Fromson
Chair
21 December 2023
MANAGER'S REVIEW
Equity markets continued to experience high levels of volatility
during the year brought about by geopolitical and macroeconomic
uncertainty with downward pressure on growth company multiples.
Against this backdrop, the portfolio, whilst well diversified, with
exposure to 158 quoted and unquoted companies, has delivered a
decrease in net asset value per share of 3.1 per cent over the
year.
PORTFOLIO REVIEW
Overview
The closing net assets of GBP210 million were invested as
follows:
Asset class NAV (GBPmn) % of NAV* Number of investees** % return in the year***
Unquoted 49 23 37 (15)
----------- --------- --------------------- -----------------------
AIM -- traded companies 80 38 45 3
----------- --------- --------------------- -----------------------
WS Gresham House UK
Micro Cap Fund 25 12 45 5
----------- --------- --------------------- -----------------------
WS Gresham House UK
Multi Cap Income Fund 21 10 42 10
----------- --------- --------------------- -----------------------
WS Gresham House UK
Smaller Companies Fund 17 8 40 0
----------- --------- --------------------- -----------------------
Liquid assets# 18 9 N/A 4
----------- --------- --------------------- -----------------------
Totals 210 100 209 (3)
----------- --------- --------------------- -----------------------
* By value as at 30 September 2023.
** Includes investee companies held in more than one fund. Total
number of individual companies held is 158.
*** Return includes interest received on unquoted realisations
during the year.
# Represents cash, OEICs and net current assets. % return in the
period relates only to the OEICs.
The tables b show the breakdown of new investments and
realisations over the course of the year and below is a commentary
on some of the key highlights in both the unquoted and quoted
portfolios.
Investment activity - Unquoted and Quoted
The Company's investment strategy is primarily focused on
companies operating in parts of the economy that we believe are
benefiting from long-term structural growth trends and in sectors
where we have deep expertise and networks.
During the year, GBP10.9 million was invested into 14 companies
including six new additions to the portfolio and eight follow-on
investments.
Five new unquoted investments totalling GBP3.3 million were
completed during the year into Branchspace, Cognassist, Connect
Earth, Dayrize B.V. and Mable Therapy.
Below are descriptions of the new investments made;
-- Branchspace is a provider of software and consulting services
to airlines/carriers to enhance their digital and ecommerce
offerings.
-- Cognassist is a provider of neurodiversity assessment and support software.
-- Connect Earth is a provider of a proprietary environmental
database that estimates carbon emissions.
-- Dayrize is a provider of a rapid product -- level
sustainability impact assessment software tool for
retailers and Consumer Packaged Goods companies.
-- Mable Therapy is a digital platform offering mental health
counselling and speech and language therapy to children.
-- One new AIM quoted investment of GBP1.0 million was made during the year:
-- Tan Delta Systems is a manufacturer of oil condition analysis
sensors that detect and measure wear and contamination in
industrial applications.
-- The Company made additional investments totalling GBP6.6
million into eight existing portfolio companies,
three quoted and five unquoted, across the year. This is
consistent with the investment strategy of continuing to back the
Company's high potential assets with further capital to support
future growth. We anticipate the level of follow -- on investment
will continue to grow as the capital hungry earlier stage portfolio
continues to mature.
Unquoted Portfolio
Performance
The unquoted portfolio decreased in value by 15 per cent during
the year. The macro economic environment remained challenging for
the Company's portfolio companies although some stability has been
seen in market multiples in more recent months. UK business es ha
ve seen both demand and operating margins come under pressure due
to marked increases in inflation and interest rates. Such
macroeconomic conditions have not been faced by management teams in
a generation, however Gresham House's experienced non -- executive
directors and portfolio consultants continue to support the
portfolio's companies during these turbulent times.
Orri and SecureCloud+ were the two investments that made the
biggest positive contribution in the year. Orri, a provider of
intensive out -- patient care for adults with eating disorders,
delivered year on year revenue growth, in excess of 20 per cent .
The company opened a new site and drew down a further VCT loan in
the period which is expected to support continuing growth in the
coming year.SecureCloud+ is a specialist IT managed services
company specifically serving the Ministry of Defence and related
contractors. The company delivered both revenue and profit growth
in the period, growing EBITDA, in particular by over 40 per cent .
A focus on maintaining margins for new contract wins in a growing
market helped SecureCloud+ deliver a very encouraging performance.
It is now well set to continue on its positive trajectory. Overall
performance was also positively impacted by the receipt of the
maximum deferred consideration relating to the earnout arrangements
on Pho, a divestment completed in a previous period. In line with
our valuation policy, this was only recognised on receipt.
The largest detractors from performance were in the healthcare
and B2C ecommerce sectors. Panthera Biopartners, an independent
site management organisation which provides patient recruitment
services to clinical research organisations, pharma and biotech
companies, struggled to scale its operations and deliver a growing
number of contracts as profitably as it had previously. This
resulted in a significantly loss -- making year and the requirement
for further funding. Since then the company has started to deliver
profitable revenue growth. Yappy is an e -- commerce business that
provides personalised products to companion pet owners. It
struggled to acquire customers at a cost that would deliver
sufficient lifetime value to support a profitable business once
significant scale was achieved. As a result, the company has
pivoted its strategy to exploit its proprietary personalisation
software, but this new strategy remains in its early stages of
development.
As Investment Manager we remain highly engaged with the
management teams within the portfolio, sharing insight and best
practice to help them both manage risk and spot opportunities in a
quickly changing environment. We have continued to invest in our
portfolio and in -- house talent teams, which alongside our
extensive network of earlier stage, high growth company experts .
This will ensure we are well positioned to help the companies that
the Company invests in to navigate the challenges they face whilst
also continuing to develop and scale.
Divestments
There was one full realisation in the unquoted portfolio during
the year with proceeds of GBP0.8 million received from the
realisation of Evotix, for a gross money multiple of 0.7x cost. In
addition to this, the Key Travel Loan Notes matured for GBP0.4
million taking the gross money multiple to 3.2x cost along with
deferred earn -- out consideration of GBP1.4 million from the sale
of Pho for a gross money multiple of 3.1x cost.
Quoted Portfolio (AIM-traded investments)
Performance
The quoted portfolio delivered positive absolute performance of
3 per cent during the year, despite the significant geopolitical
and macroeconomic uncertainty in the markets. For reference the AIM
market in the UK fell 10 per cent over the same period. Despite the
adverse share price performances from many of the portfolio
companies the majority of the AIM portfolio remains in good
financial health and is exposed to structural growth areas
providing some insulation from the deteriorating economic
conditions.
The best performing investments sit within the software sector
with Cerillion, a provider of billing and charging software to the
telecoms industry continuing to deliver strong revenue and profit
growth with the release of their interim results indicating 20 per
cent organic growth with record margins and strong Free Cash Flow
generation. In addition, Netcall, a provider of cloud contact
centre and business process automation software demonstrated
ongoing strong trading driven by demand for cloud services and
robust new customer acquisition.
The largest detractors from performance were both in the
healthcare and education sector with Aptamer, a developer of a
platform technology with applications in the therapeutic and
diagnostic areas of healthcare, experiencing share price weakness
after the release of a trading update indicating a significant
downgrade to full year revenue expectations. The company
consequently considered funding options and the CEO resigned.
Anpario, an international manufacturer and distributor of natural
animal feed additives for animal health, nutrition and biosecurity,
also suffered share price weakness following a profit warning
indicating a significant reduction in full year EBITDA due to raw
material costs, Covid in China and delays in shipment.
We closely monitor the AIM portfolio with a rolling programme of
independent reviews of top AIM holdings and broadly continue to be
positive on the long-term investment prospects of these companies.
Many of the larger quoted investments have been long-term holdings.
These companies are typically profitable, cash generative
businesses with low levels of financial gearing and continue to
have attractive long-term growth prospects.
Divestments
The opportunity to crystallise further gains was taken for
Cerillion plc; over the course of the year proceeds of GBP0.7
million were realised at 15.8x cost.
Seven companies which were impacted by difficult trading
conditions entered into administration during the year and have
subsequently been moved to realised values. The impact on NAV per
share for the year was -- 0.7 per cent in aggregate with the
majority of the impact taken in prior years.
Collective Investment Vehicles
The Manager believes that the Company's investments in Micro
Cap, Multi Cap Income and Small Cap are a core component of the
Company's portfolio construction. These investments provide
shareholders with additional diversification through exposure to an
additional 76 underlying companies, as well as access to the
potential returns available from a larger and more established
group of companies that fall within the Manager's core area of
expertise.
Over the year Micro Cap delivered a return of 5 per cent return,
Multi Cap delivered a return of 10 per cent and the Small Cap fund
delivered 0.4 per cent.
Micro Cap and Multi Cap Income continue to be both highly rated
by independent ratings agencies. Micro Cap's cumulative performance
is currently top quartile within the IA UK Smaller Companies sector
and is the fifth best performing fund over the past 10 years. Multi
Cap Income's cumulative performance has remained the best performer
within the IA UK Equity Income sector since launch in June 2017 and
is the second best performer over five years. Small Cap has also
achieved top quartile cumulative performance since launch in 2019
and is the fifth best performing fund over the past three
years.
Liquid assets (cash and near cash)
The Company h eld cash and liquidity OEICs of approximately
GBP18 million at the year -- end. This asset class is
conservatively managed to take minimal or no capital risk. The
average 7 day yield on the liquidity OEICs was 5.17 per cent at the
end of the year.
ESG Highlights
During the year we have conducted our second ESG survey of our
unquoted portfolio companies, to identify how these companies think
about ESG and which ESG data is already being reported and
monitored. Further details on our ESG approach and policies can be
found in the strategic report section of the full Annual
Report.
Third party independent valuations
During the year, the Company engaged the services of Lincoln
International and Kroll to conduct independent third party
valuations as a means of managing the Board's risk in respect of a
systematic error regarding the valuation of one or more of the
material VCT portfolio assets. It was agreed that valuation
responsibility is, and will remain, with the Investment Manager and
that this does not constitute outsourcing of any part of the
valuation. The Investment Manager uses these independent valuations
in conjunction with their own valuations to provide independent
assurance and risk mitigation to the Board and the Board continues
to support this.
Levelling up
On 18 July 2023, the House of Commons Treasury Committee
published its report (the "Report") on Venture Capital, which
includes growth capital funding provided by Venture Capital Trusts,
which was broadly positive. MPs recommended that venture capital
firms and their investment companies should collect and publish
their diversity statistics. The Report also considered the
allocation of investment capital to the various regions of the
UK.
The Company and the Investment Manager have long supported the
creation of opportunities for everyone across the UK through its
investment portfolio.
The investment due diligence process for any proposed new
investment includes a consideration of the board structure and
composition as part of the Manager's governance considerations
within the ESG Decision Tool.
We have considered the findings of the Report and set out for
the first time the relevant metrics pertaining to the Company's
portfolio of unquoted investments as at 30 September 2023, Gresham
House plc and the Gresham House Strategic Equity division,
responsible for managing the public and private equity portfolios
managed or advised by the Manager.
Table 1 below shows that the portfolio companies were
predominantly founded by males, or groups of male founders, with 14
per cent being founded by all females or groups of mixed male and
female founders.
Table 1 - Portfolio company founders
All male 86%
Female/mixed
gender 14%
----
Table 2 - Portfolio company board composition 1
All male 85%
Female 15%
----
Table 2 above shows that board composition within the portfolio
was similarly predominantly male, with 15 per cent of board members
being female, after excluding representatives of Gresham House.
Table 3 - Allocation of capital by region 2
London and South
East 65%
Other regions 35%
----
Table 3 above shows the regions of the UK where the Company's
capital has been invested, with the majority of capital being
invested in London and/or the South East.
As of the end of 2023, the Company is in the process of signing
up to the Investing in Women Code. This is a commitment to support
the advancement of female entrepreneurship in the United Kingdom by
improving female entrepreneurs' access to tools, resources and
finance from the financial services sector.
1. Excluding Gresham House representatives.
2. Based on cost of investment.
In September 2023, the Manager hosted its first female -- led
event bringing together innovators, investors, and advisers to
foster relationships and share learnings.
Table 4 below shows the gender diversity within Gresham House as
at 30 September 2023.
Table 4 - Gresham House gender diversity(1)
Male 62%
Female 38%
----
Table 5 - Gresham House strategic equity division gender
diversity 2
Male 70%
Female 30%
----
1. As at 30 September 2023.
2. As at 30 September 2023
Table 5 above shows the gender diversity within the Strategic
Equity division of Gresham House, responsible for managing the
Company's portfolio.
Gresham House released their Diversity, Equity & Inclusion
("DEI") strategy at the start of 2022 to help understand the
changing landscape of DEI. Included within the strategy are
initiatives to improve DEI such as carrying out unconscious bias
training for all employees; evolving Human Resources systems to
include DEI data which is now shared quarterly with our Group
Management Committee and divisional heads and developing clear DEI
guidelines for recruiters.
During the year Gresham House have promoted or actively attended
a number of events targeted at women entrepreneurs and the senior
women from across Gresham House have all attended a 12 -- week
external Resilient Women's Leadership Programme to develop their
capability to lead.
Gresham House is committed to improving the diversity of its
investment teams, the management teams of the investee companies
that they support and increasing the amount and number of
investments across the UK.
Outlook
The UK economic outlook remains uncertain but the investment
portfolio is well diversified and the opportunity to invest and
support growth in entrepreneurial earlier -- stage businesses
remains strong. Our focus on investing in parts of the economy
which are experiencing structural growth and in sectors where we
have extensive talent networks and domain expertise. We have an
experienced team working closely with the portfolio companies to
help them navigate the challenges that lie ahead.
The exit environment is likely to remain subdued, resulting in
longer average investment hold times, but also providing further
portfolio re -- investment opportunities. Previous evidence has
shown that investing throughout the economic cycle has the
potential to yield strong returns and we are seeing a number of
opportunities, both new deals and further investment into the
existing portfolio, which have the potential to drive shareholder
value over the medium term.
Gresham House Asset Management Ltd
Investment Manager
21 December 2023
Investments in the year
Company Location Sector Activity Book
cost
GBP'000
Unquoted investments
-------------------- ----------------------- ----------------------------- --------
New
-------------------- ----------------------- ----------------------------- --------
A platform for supporting
those
Cognassist UK Ltd Newcastle upon Tyne Healthcare & education with learning needs 902
-------------------- ----------------------- ----------------------------- --------
A rapid product -- level
sustainability
impact assessment software
tool for retailers and
Consumer
Packaged Goods ("CPG")
Dayrize B.V. Amsterdam Technology companies 756
-------------------- ----------------------- ----------------------------- --------
Digital health platform for
speech therapy & counselling
for children and young
Mable Therapy Ltd Leeds Healthcare & education adults 619
-------------------- ----------------------- ----------------------------- --------
Specialist digital retailing
consultancy and software
provider
to the aviation and travel
Branchspace Ltd London Technology industry 609
-------------------- ----------------------- ----------------------------- --------
Helps businesses track their
Connect Earth Ltd London Business services carbon emissions 451
-------------------- ----------------------- ----------------------------- --------
Follow- on
-------------------- ----------------------- ----------------------------- --------
A platform for connecting
businesses'
Patchworks Integration Ltd London Technology applications 2,080
-------------------- ----------------------- ----------------------------- --------
Online travel agent
specialising
TravelLocal Ltd London Consumer markets in tailor -- made holidays 715
-------------------- ----------------------- ----------------------------- --------
Provides real time life
science
intelligence as a
subscription
Airfinity Ltd London Healthcare & education service 676
-------------------- ----------------------- ----------------------------- --------
Recruitment services for
clinical
Panthera Biopartners Ltd Lancashire Healthcare & education trials 480
-------------------- ----------------------- ----------------------------- --------
Provider of intensive day
care
treatments for eating
Orri Ltd London Healthcare & education disorders 227
-------------------- ----------------------- ----------------------------- --------
Total unquoted investments 7,515
--------
AIM-traded investments
-------------------- ----------------------- ----------------------------- --------
New
-------------------- ----------------------- ----------------------------- --------
Supplier of real -- time oil
Tan Delta Systems plc South Yorkshire Business services condition monitoring sensors 956
-------------------- ----------------------- ----------------------------- --------
Follow- on
-------------------- ----------------------- ----------------------------- --------
Commercialisation of
university
research -- based cyber
security
Crossword Cybersecurity plc* London Technology software and consulting 1,040
-------------------- ----------------------- ----------------------------- --------
Wealth advisory service for
Oberon Investments Group plc London Business services individuals and businesses 688
-------------------- ----------------------- ----------------------------- --------
SEEEN plc London Technology A video technology business 659
-------------------- ----------------------- ----------------------------- --------
Total AIM-traded investments 3,343
--------
Total investments in the year # 10,858
--------
*Investment in to unquoted convertible loan note
# includes Unquoted and AIM investments only.
Realisations in the year
First investment Original book cost# Proceeds++ Overall multiple
Company date GBP'000 GBP'000 return
Unquoted realisations
--------------------- ----------------- ------------------- ---------- --------------------
Evotix Ltd Full trade sale Jul 21 423 792 0.7*
--------------------- ----------------- ------------------- ---------- --------------------
Escrow loan note
Key Travel Ltd maturity Jun 13 255 383 3.2**
--------------------- ----------------- ------------------- ---------- --------------------
Glisser Ltd Written off Nov 19 1,787 - -
--------------------- ----------------- ------------------- ---------- --------------------
Rezatec Ltd Written off Jan 20 1,620 - -
--------------------- ----------------- ------------------- ---------- --------------------
CMME Group Ltd Written off Apr 15 1,136 - -
--------------------- ----------------- ------------------- ---------- --------------------
Vinoteca Ltd Written off Sep 19 1,054 - -
--------------------- ----------------- ------------------- ---------- --------------------
Your Welcome Ltd Written off Aug 18 1,030 - -
--------------------- ----------------- ------------------- ---------- --------------------
Total unquoted realisations 7,305 1,175
------------------- ---------- --------------------
AIM-traded and LSE listed realisations
Cerillion plc Market sale Jul 15 42 661 15.8
--------------------- ----------------- ------------------- ---------- --------------------
MXC Capital Ltd Tender offer May 15 30 17 0.6
--------------------- ----------------- ------------------- ---------- --------------------
Hawkwing plc Written off Nov 11 2,136 - -
--------------------- ----------------- ------------------- ---------- --------------------
InterQuest Group plc Written off Feb 07 620 - -
--------------------- ----------------- ------------------- ---------- --------------------
Total AIM-traded and LSE listed realisations 2,828 678
----------------- ------------------- ---------- --------------------
Total realisations in the year 10,133 1,853
----------------- ------------------- ---------- --------------------
Earn out proceeds of GBP1.4mn were received during the year from
Pho, which was realised in July 2021, making a total return of 3.1x
cost.
# Residual book cost at realisation date.
++ Proceeds at time of realisation including interest.
* Original investment was GBP1.1 million and following a
restructuring in July 2021, the residual book cost was GBP0.4
million.
** Includes interest/dividends received, loan note redemptions
and partial realisations accounted for in prior periods
Final Dividend
Subject to shareholder approval at the AGM, a final dividend of
2.25p per share will be paid on 8 March 2024 to shareholders on the
register at 9 February 2024. The ex-dividend date will be 8
February 2024.
Annual General Meeting
The AGM will be held on 5 March 2024 at Butchers' Hall, 87
Bartholomew Close, London, EC1A 7EB.
Shareholders are invited to attend the AGM from 10.30am with an
introductory presentation to shareholders by the Company Chair, Ms
Sarah Fromson, followed by a Q&A session with the Board and the
Manager. The formal business of the AGM will commence at
11.00am.The Manager will deliver a presentation at 11.30am,
followed by some light refreshments at 12.30pm. The Company intends
to hold this AGM in person, however, we will also live stream the
event for any shareholders who do not wish, or are unable, to
attend in person. A separate Notice convening the AGM will be
posted to shareholders and will be separate to the Annual Report.
The Notice will include an explanation of the items to be
considered at the AGM and will be uploaded to the Company's website
in due course.
Further Information
The Annual Report and Accounts for the year ended 30 September
2023 will be available today on www.baronsmeadvcts.co.uk .
Each of the above documents will be submitted shortly in full
unedited text to the Financial Conduct Authority's National Storage
Mechanism and will be available for inspection at
data.fca.org.uk/#/nsm/nationalstoragemechanism in accordance with
DTR 6.3.5(1A) of the Financial Conduct Authority's Disclosure
Guidance and Transparency Rules.
LEI: 2138008D3WUMF6TW8C28
N either the contents of the Company's website nor the contents
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END
FR FFFIVFALLFIV
(END) Dow Jones Newswires
December 22, 2023 02:00 ET (07:00 GMT)
Baronsmead Second Venture (LSE:BMD)
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De Mar 2024 a Abr 2024
Baronsmead Second Venture (LSE:BMD)
Gráfica de Acción Histórica
De Abr 2023 a Abr 2024
