TIDMMVCT 
 

Molten Ventures VCT plc

LEI: 2138003I9Q1QPDSQ9Z97

Half-Year Report

9 December 2022

RECENT PERFORMANCE SUMMARY

 
                                           30     31     30 
                                           Sept   Mar    Sept 
                                           2022   2022   2021 
                                          Pence  Pence  Pence 
Net Asset Value ("NAV") per Share          52.8   60.6   61.0 
Cumulative distributions paid per Share   113.6  110.5  109.0 
                                          -----  -----  ----- 
Total Return per Share                    166.4  171.1  170.0 
                                          =====  =====  ===== 
 

CHAIRMAN'S STATEMENT

I am pleased to present the Half-Yearly Report for the Company for the six months ended 30 September 2022.

Perhaps unsurprisingly, the Company has experienced a modest fall in its Net Asset Value per share ("NAV") over the period, as more testing market conditions have taken hold and public market comparables, where these are used as inputs to valuations, are almost universally down in the period. The portfolio was notable for a significant exit from the legacy portfolio and also saw a number of new investments being added to the technology portfolio.

Net Asset Value and results

At 30 September 2022, the Company's Net Asset Value per share ("NAV") stood at 52.8p, a decrease of 4.7p or 7.8% since 31 March 2022 (after adding back the dividend paid during the period).

The loss on ordinary activities after taxation for the period was GBP8.9 million (period ended 30 September 2021: GBP17.1 million profit), comprising a revenue loss of GBP486,000 (period ended 30 September 2021: GBP63,000) and a capital loss of GBP8.4 million (period ended 30 September 2021: GBP17.2 million profit).

Dividend

In 2022, the interim dividend was paid at the end of January. The Board has reviewed the payment date of the interim dividend and decided to move the usual date to early April in future as this will provide the Board with some additional flexibility as to the level of dividend that can be paid.

The Board targets a total annual dividend of equal to 5% of net asset value. An interim dividend of 1.0p per Share will be paid on 7 April 2023, to Shareholders on the register at 3 March 2023. The Board expects to announce in due course a final dividend for the year ended 31 March 2023 which will be paid in August/September 2023.

Shareholders are reminded that the Company now operates a Dividend Reinvestment Scheme, which allows Shareholders to automatically reinvest their dividends into new shares in the Company and obtain further income tax relief on that investment. Further details about how to opt-in can be found in the "Shareholder Information" section on the inside cover of this report.

Venture capital investments

During the period, the Company made three new and two follow-on investments, at a total cost of GBP8.2 million.

New investments were made in Expanding Circle Limited (trading as Altruistiq), BeZero Carbon Limited and Fluidic Analytics Limited. Follow-on investments were made in Focal Point Positioning Limited, and Apperio Limited.

At the period end, the Company held a portfolio of 46 venture capital investments, valued at GBP71.8 million.

As usual, the Board has reviewed the valuations of the unquoted investments as at 30 September 2022 and a number of adjustments to their carrying values have been made. This has resulted in a net valuation downturn of GBP6.9 million for the period across the whole portfolio, primarily as a result of falls in comparable market valuations and assessment of the portfolio.

The Company holds two AIM-quoted investments; Access Intelligence plc and Fulcrum Utility Services Limited, which are both valued on their share prices as at 30 September 2022. The valuation of the investment in Access Intelligence saw a decrease of GBP746,000 over the period and that in Fulcrum of GBP26,000, driven by general market conditions.

Further details on these investments are included in the Investment Manager's Report.

Fundraising

As reported in the last Annual Report, the Company closed a very successful offer for subscription in April 2022, having raised GBP20 million.

In view of the strong demand from investors and the expectation of a continuing stream of good quality deal flow, the Company launched a new offer for subscription in October seeking to raise up to GBP30 million (with an overallotment facility of GBP10 million to be used at the Directors' discretion).

Investor interest in this offer is once again proving to be high with over [GBP12] million having been raised at the time of writing.

Shareholders can find full details of the offer including the prospectus at:

www.moltenventures.com

Investors are recommended to consult their financial adviser before making any investment decisions.

Share buybacks

The Company continues to operate a policy of buying in its shares that become available in the market at approximately a 5% discount to the latest published NAV, subject to regulatory and liquidity constraints.

In line with this policy, during the period, the Company purchased 2,620,650 shares for cancellation at an average price of 54.9p per share.

Any Shareholders considering selling their shares will need to use a stockbroker, whom you should ask to contact Panmure Gordon (UK) Limited, who acts as the Company's corporate broker and can provide details on closed periods and when the Company is able to buy shares.

Outlook

Despite the reduced valuations of some investments, the Board remains satisfied that the Company continues to hold a well-diversified portfolio of emerging technology businesses which have the potential to deliver attractive returns to investors.

While valuations of the world's largest quoted technology businesses have fallen heavily in recent months, the transformative, venture capital backed, high growth potential technology businesses in which your Company invests operate in a different environment in terms of funding and corporate activity. fundamental drivers for innovation, for new technologies and the re-invention or creation of new markets, remain strong.

I look forward to updating shareholders on progress in my statement in the Annual Report to 31 March 2023, which will be published in the summer.

David Brock

Chairman

INVESTMENT MANAGER'S REPORT

The first six months of the financial year have been against the backdrop of a challenging market environment with inflation and rising global interest rates feeding through to a decline in the value of publicly listed high growth technology companies. Nasdaq has declined 25% in the past six months while technology sub-sectors such as semi-conductors and e-commerce have declined further. In the private markets deployment of investment capital has slowed while companies, and investors, adapt to an environment with a higher cost of capital.

This backdrop of heightened geopolitical risks and rising inflation follows a period where the Company registered an increase in Net Asset Value ("NAV") of 21% to the year end March 2022. Unsurprisingly given the headwinds the Company has seen a fall in its valuation in the following six-month period to 30 September 2022.

In the last six months the NAV has fallen from 60.1p to 52.8p a decrease of 7.7% after adding back the dividends paid in the period.

There were net unrealised valuation increases of GBP2.3m over the period; the largest being Focal Point Positioning Limited (GBP1.7m) on the back of a successful fundraising.

There were net unrealised valuation losses on investments of GBP9.3 million in the period; the largest write downs being IESO Digital Health Limited (GBP2.3m), Freetrade Limited (GBP1.8m), Primary Bid Limited (GBP1.8m) and Cervest Limited (GBP1.3m) as valuations and valuation comparables dropped in difficult market conditions.

In the period the company invested a total of GBP8.2 million into three new companies and two follow-on investments. Details of these are shown in the Chairmans's report. Post this period end one further new deal has been completed into Worldr (worldr.com https://www.globenewswire.com/Tracker?data=Dbl2N0yVazJfmTcC47ZB18DYJTBg6GoLh4VVGAWul7N_IWFiruv6ZxyCF4toTvu1FGPix5UvcpdxUWM4SSq7Cw== ), which provides security products for enterprise communications platforms such as Microsoft Teams.

In the period two exits have been completed; Lyalvale Express Ltd was part of the legacy portfolio prior to the co-investment agreement with Molten Ventures. The investment was an MBO made in 1998 and returned a multiple of 4.58x and an IRR of 15.9% over the investment period. The consideration was GBP5.9 million, having received further income and principal debt repayments of GBP2.8 million over the investment period. The sale allowed the payment of a special dividend of 1.6p in August 2022.

Servoca was also a legacy portfolio exit for a total consideration of GBP0.35 million, a small profit of 8% on cost.

Post the period end a further exit has been completed from the Molten technology portfolio; Roomex initial proceeds of GBP1.28 million are a 1.2x return on cost. There is a possibility of further escrow proceeds of GBP0.25 million.

We now define the Company as having two portfolios; a new technology portfolio invested alongside other Molten Ventures funds and a legacy portfolio assembled before the Molten Ventures plc arrangement. At the period end, the technology portfolio as a percentage of total net assets accounted for 58%, the legacy portfolio 14%, and cash 28%.

As Investment Manager of the Company, we previously signalled cautious optimism as we believe the fundamentals of technology investing remain strong. We maintain the belief that investing wisely in innovation can yield good returns across the investment cycle.

The core portfolio companies are well funded and while we are not complacent about the economic headwinds, we are confident in our technology investment strategy and the attributes of strong potential for future value growth

Elderstreet Investments Limited

Part of the Molten Ventures Group

SUMMARY OF INVESTMENT PORTFOLIO

 
                                                        Valuation      % of 
Investment Portfolio as at 30                            movement    portfolio 
September 2022                       Cost    Valuation   in period   by value 
                                    GBP'000   GBP'000    GBP'000 
Top ten venture capital 
investments 
Thought Machine Group Limited         2,400      9,118       (611)        9.1% 
Access Intelligence plc*              2,586      7,638       (746)        7.6% 
Endomagnetics Limited                 2,147      6,322           -        6.3% 
Focal Point Positioning Limited       3,300      5,906       1,710        5.9% 
Fords Packaging Topco Limited         2,433      5,867           -        5.9% 
Form3 Limited                         1,420      5,464           -        5.4% 
IESO Digital Health Limited           3,567      3,851     (2,291)        3.8% 
Ravelin Technology Limited            1,133      2,117           -        2.1% 
Impulse Innovations Limited           2,079      2,079           -        2.1% 
River Lane Research Limited             901      1,976         212        2.0% 
                                     21,966     50,338     (1,726)       50.2% 
 
Other venture capital investments    32,492     21,418     (5,196)       21.3% 
 
                                     54,458     71,756     (6,922)       71.5% 
                                    =======             ========== 
 
Cash at bank and in hand                        28,665                   28.5% 
                                             ---------              ---------- 
 
Total investments                              100,421                  100.0% 
                                             =========              ========== 
 

*Quoted on AIM

All venture capital investments are unquoted unless otherwise stated.

SUMMARY OF INVESTMENT MOVEMENTS

 
Investment additions 
 
Venture capital investments       GBP'000 
Focal Point Positioning Limited     2,700 
Expanding Circle Limited            1,835 
BeZero Carbon Limited               1,567 
Fluidic Analytics Limited           1,250 
Apperio Limited                       857 
                                  ------- 
                                    8,209 
                                  ======= 
 
 
 
                                      Value at 
                                      1 April               Profit    Realised 
Investment disposals          Cost      2022     Proceeds   vs cost     gain 
                            GBP'000   GBP'000    GBP'000   GBP'000    GBP'000 
Venture capital 
investments 
Lyalvale Express Limited      1,915      5,979      5,979     4,064          - 
Servoca plc                     333        360        360        26          - 
                            -------  ---------  ---------  --------  --------- 
                              2,248      6,339      6,339     4,090          - 
                            =======  =========  =========  ========  ========= 
 

*Quoted on AIM

All venture capital investments are unquoted unless otherwise stated.

UNAUDITED BALANCE SHEET

as at 30 September 2022

 
                                                   30       30       31 
                                                   Sept     Sept     Mar 
                                                   2022     2021     2022 
                                           Note  GBP'000  GBP'000  GBP'000 
 
Fixed assets 
Investments                                   9   71,756   62,791   76,808 
 
Current assets 
Debtors                                                8        7       20 
Cash at bank and in hand                          28,665   26,045   31,095 
                                                 -------  -------  ------- 
                                                  28,673   26,052   31,115 
 
Creditors: amounts falling due within one 
 year                                            (1,083)     (99)    (356) 
                                                 -------  -------  ------- 
 
Net current assets                                27,590   25,953   30,759 
                                                 -------  -------  ------- 
 
Net assets                                        99,346   88,744  107,567 
                                                 =======  =======  ======= 
 
 
Capital and reserves 
Called up Share capital                       7    9,406    7,275    8,880 
Capital redemption reserve                           925      728      794 
Share premium account                             63,628   36,438   56,273 
Merger reserve                                         -    1,828      673 
Special reserve                               8    2,285   12,041    5,303 
Capital reserve - unrealised                      23,744   31,052   35,220 
Capital reserve - realised                    8      936        -    1,516 
Revenue reserve                               8  (1,578)    (618)  (1,092) 
                                                 -------  -------  ------- 
 
Equity Shareholders' funds                    6   99,346   88,744  107,567 
                                                 =======  =======  ======= 
 
Basic and diluted Net Asset Value per       6      52.8p    61.0p    60.6p 
 Share 
 

UNAUDITED INCOME STATEMENT

for the six months ended 30 September 2022

 
                                                                              Year 
                                                                              ended 
                                                                                31 
                            Six months ended           Six months ended        Mar 
                              30 Sept 2022               30 Sept 2021          2022 
                       Revenue  Capital   Total   Revenue  Capital   Total    Total 
                Note   GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
 
Income                       -        -        -      295        -      295      300 
Gains on 
investments 
  Realised                   -        -        -        -        -        -       12 
Unrealised                   -  (6,922)  (6,922)        -   17,575   17,575   20,221 
                       -------  -------  -------  -------  -------  -------  ------- 
                             -  (6,922)  (6,922)      295   17,575   17,870   20,533 
 
Investment management 
 fees                    (289)    (867)  (1,156)    (138)    (416)    (554)  (1,721) 
Performance incentive 
 fees                        -    (621)    (621)        -        -        -        - 
Other expenses           (197)        -    (197)    (220)        -    (220)    (407) 
                       -------  -------  -------  -------  -------  -------  ------- 
 
Return on ordinary 
 activities before 
 taxation                (486)  (8,410)  (8,896)     (63)   17,159   17,096   18,405 
 
Tax on total 
comprehensive 
income and 
ordinary 
activities                   -        -        -        -        -        -        - 
 
Return 
 attributable 
 to equity 
 Shareholders     4      (486)  (8,410)  (8,896)     (63)   17,159   17,096   18,405 
                       =======  =======  =======  =======  =======  =======  ======= 
 
Basic and 
 diluted 
 return per 
 Share            4     (0.3p)   (4.4p)   (4.7p)        -    11.7p    11.7p    12.0p 
 

All Revenue and Capital items in the above statement are derived from continuing operations. The total column within the Income Statement represents the profit and loss account of the Company.

UNAUDITED STATEMENT OF CHANGES IN EQUITY

for the six months ended 30 September 2022

 
                Called 
                  up 
                 Share   Capital redemp-   Share   Merger   Special       Capital            Capital       Revenue 
                capital    tion reserve   premium  reserve  reserve  reserve-unrealised  reserve-realised  reserve   Total 
                GBP'000      GBP'000      GBP'000  GBP'000  GBP'000       GBP'000            GBP'000       GBP'000  GBP'000 
At 1 April 
 2021             5,537              659   18,321    1,828   15,463              14,159                 -    (555)   55,412 
                -------  ---------------  -------  -------  -------  ------------------  ----------------  -------  ------- 
Total 
 comprehensive 
 income               -                -        -        -        -              20,221           (1,279)    (537)   18,405 
Transfer 
 between 
 reserves             -                -        -  (1,155)  (6,838)                 840             7,153        -        - 
Transactions 
with owners 
Issue of new 
 Shares           3,478                -   37,952        -        -                   -                 -        -   41,430 
Share issue 
 costs                -                -        -        -  (1,900)                   -                 -        -  (1,900) 
Purchase of 
 own Shares       (135)              135        -        -  (1,422)                   -                 -        -  (1,422) 
Dividends paid        -                -        -        -        -                   -           (4,358)        -  (4,358) 
                -------  ---------------  -------  -------  -------  ------------------  ----------------  -------  ------- 
At 31 March 
 2022             8,880              794   56,273      673    5,303              35,220             1,516  (1,092)  107,567 
                -------  ---------------  -------  -------  -------  ------------------  ----------------  -------  ------- 
Total 
 comprehensive 
 income               -                -        -        -        -             (6,921)           (1,489)    (486)  (8,896) 
Transfer 
 between 
 reserves             -                -        -    (673)  (1,579)             (4,555)             6,807        -        - 
Transactions 
with owners 
Issue of new 
 Shares             657                -    7,767        -        -                   -                 -        -    8,424 
Share issue 
 costs                -                -    (412)        -        -                   -                 -        -    (412) 
Purchase of 
 own Shares       (131)              131        -        -  (1,439)                   -                 -        -  (1,439) 
Dividends paid        -                -        -        -                            -           (5,898)        -  (5,898) 
                -------  ---------------  -------  -------  -------  ------------------  ----------------  -------  ------- 
At 30 
 September 
 2022             9,406              925   63,628        -    2,285              23,744               936  (1,578)   99,346 
                =======  ===============  =======  =======  =======  ==================  ================  =======  ======= 
 

A transfer of GBP1,488,000 was made from the Special Reserve to the Capital Reserve -- realised in respect of capital expenses for the period. A transfer of GBP91,000 was made from the Capital Reserve -- unrealised to the Special Reserve for realised loss on investment disposal and reversal of impairment loss during the year.

UNAUDITED STATEMENT OF CASH FLOWS

for the six months ended 30 September 2022

 
                                          Six months  Six months 
                                             ended       ended 
                                            30 Sept     30 Sept    Year ended 
                                             2022        2021      31 Mar 2022 
                                           GBP'000     GBP'000      GBP'000 
 
Cash flow from operating activities 
Return on ordinary activities before 
 taxation                                    (8,896)      17,096        18,405 
(Gains)/losses on investments                  6,922    (17,575)      (20,233) 
Decrease/(increase) in debtors                    14          29            11 
Increase in creditors                            400          18           216 
 
Net cash inflow/(outflow) generated 
 from operating activities                   (1,560)       (432)       (1,601) 
                                          ----------  ----------  ------------ 
 
Cash flow from investing activities 
Purchase of investments                      (8,209)     (1,120)      (12,491) 
Sale of investments                            6,339         660           672 
 
Net cash outflow from investing 
 activities                                  (1,870)       (460)      (11,819) 
                                          ----------  ----------  ------------ 
 
Cash flows from financing activities 
Proceeds from Share issue                      8,424      19,924        41,429 
Share issue costs                              (414)       (797)       (1,853) 
Purchase of own Shares                       (1,112)       (667)       (1,362) 
Equity dividends paid                        (5,898)     (2,182)       (4,358) 
 
Net cash inflow from financing 
 activities                                    1,000      16,278        33,856 
                                          ----------  ----------  ------------ 
 
Increase/(decrease) in cash                  (2,430)      15,386        20,436 
                                          ==========  ==========  ============ 
 
Net movement in cash 
Beginning of period                           31,095      10,659        10,659 
Net cash inflow/(outflow)                    (2,430)      15,386        20,436 
                                          ----------  ----------  ------------ 
End of period                                 28,665      26,045        31,095 
                                          ==========  ==========  ============ 
 

NOTES

1. The unaudited Half-Yearly Report covers the six months to 30 September 2022 and has been prepared in accordance with the accounting policies set out in the statutory accounts for the period ended 31 March 2022, which were prepared in accordance with the Financial Reporting Standard 102 ("FRS 102") and the Statement of Recommended Practice "Financial Statements of Investment Trust Companies" issued in July 2022 ("SORP").

2. The Company has only one class of business and derives its income from investments made in shares, securities and bank deposits.

3. The comparative figures are in respect of the six months ended 30 September 2021 and the year ended 31 March 2022 respectively.

4. Basic and diluted return per Share

 
                                                                  Year 
                           Six months ended  Six months ended     ended 
                                30 Sept           30 Sept         31 Mar 
                                 2022              2021            2022 
    Return per Share 
    based on: 
    Net revenue 
     (loss)/return 
     (GBP'000)                        (486)              (63)        (537) 
                           ================  ================  =========== 
 
    Capital return per 
    Share based on: 
    Net capital 
     gain/(loss) 
     (GBP'000)                      (8,410)            17,159       18,942 
                           ================  ================  =========== 
 
    Weighted average 
     number of Shares           189,766,121       146,059,737  152,969,728 
                           ================  ================  =========== 
 

5. Dividends

 
                                                   30 Sept  31 March 
                            Per                      2022     2022 
                          Share  Revenue  Capital   Total    Total 
                          Pence  GBP'000  GBP'000  GBP'000  GBP'000 
    Payable 
    2023 Interim           1.5p        -    2,822    2,822         - 
    Paid in the period 
    2022 Final             3.1p        -    5,898    5,898         - 
    2022 Interim           1.5p        -        -        -     2,175 
    2021 Final             1.5p        -        -        -     2,183 
                                 -------  -------  ------- 
                                       -    5,898    5,898     4,358 
                                 =======  =======  =======  ======== 
 

6. Basic and diluted Net Asset Value per Share

 
                                          30 Sept 
                                            2022     30 Sept 2021  31 Mar 2022 
    Net asset value per Share based 
    on: 
    Net assets (GBP'000)                     99,346        88,744      107,567 
                                        ===========  ============  =========== 
 
    Number of Shares in issue at 
     period end                         188,123,911   145,501,149  177,597,183 
                                        ===========  ============  =========== 
 
    Net Asset Value per Share                 52.8p         61.0p        60.6p 
                                        ===========  ============  =========== 
 

7. Called up Share capital

 
                                                                     31 Mar 
                                       30 Sept 2022  30 Sept 2021      2022 
    Ordinary Shares of 5p each 
    Number of Shares in issue at 
     period end                         188,123,911   145,501,149  177,597,183 
                                       ============  ============  =========== 
 
    Nominal value (GBP'000)                   9,406         7,275        8,880 
                                       ============  ============  =========== 
 

During the period the Company allotted 12,665,155 Ordinary Shares of 5p each ("Shares") under an Offer for Subscription that launched in November 2021, at an average price of 64.3p per Share. Gross proceeds received thereon were GBP8.1 million, with issue costs in respect of the Offer amounting to GBP396,000.

During the period the Company allotted 482,223 Ordinary Shares of 5p each ("Shares") under a Dividend Reinvestment Scheme that launched in March 2022, at an average price of 57.5p per Share. Gross proceeds received thereon were GBP277,000, with issue costs in respect of the Offer amounting to GBP16,000.

During the period, the Company purchased Shares for cancellation for an aggregate consideration of GBP1.4 million, at an average price of 54.9p per Share (approximately equal to a 5.0% discount to the most recently published NAV at the time of purchase) and representing 1.5% of the Share capital in issue as at 1 April 2022.

8. Reserves

The special reserve is available to the Company to enable the purchase of its own Shares in the market without affecting its ability to pay dividends and allows the Company to write back realised capital losses arising on disposals and impairments.

Distributable reserves are calculated as follows:

 
                                              30 Sept  30 Sept  31 Mar 
                                                2022     2021     2022 
                                              GBP'000  GBP'000  GBP'000 
  Special reserve                               2,285   12,041    5,053 
  Capital reserve - realised                      936        -    1,516 
  Revenue reserve                             (1,578)    (618)  (1,092) 
  Merger reserve - distributable element            -      423        - 
  Unrealised losses - net of unquoted gains   (1,057)    6,283    1,316 
                                              -------  -------  ------- 
                                                  586   18,129    6,793 
                                              =======  =======  ======= 
 

In October 2018, the balances on the Share Premium account and the capital redemption reserve were cancelled and added to the special reserve, contributing an additional GBP26.2 million to distributable reserves. The VCT regulations place some restrictions on the use of these reserves during the first three to four years after the funds on which they arose were raised.

Following the granting of shareholder approval at the Annual General Meeting in August, the Company is now commencing the process to cancel the share premium account and capital redemption reserve which will create additional distributable reserves.

   9.   Investments 

The fair value of investments is determined using the detailed accounting policy as set out in Note 1 of the Annual Report.

The Company has categorised its financial instruments using the fair value hierarchy as follows:

   Level 1        Reflects financial instruments quoted in an active market (fixed interest investments, and investments in shares quoted on either the Main or AIM Markets); 
   Level 2        Reflects financial instruments that have prices that are observable either directly or indirectly; and 
   Level 3        Reflects financial instruments that use valuation techniques that are not based on observable market data (unquoted equity investments and loan note investments). 
 
                                      30 Sept                             31 Mar 
                                        2022                                2022 
           Level 1  Level 2  Level 3   Total   Level 1  Level 2  Level 3   Total 
           GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
 
AIM 
 quoted 
 shares      7,056      798        -    7,854    7,723      903        -    8,626 
Loan 
 notes           -        -      508      508        -        -      508      508 
Unquoted 
 shares          -        -   63,394   63,394        -        -   67,674   67,674 
           -------  -------  -------  -------  -------  -------  -------  ------- 
             7,056      798   63,902   71,756    7,723      903   68,182   76,808 
           =======  =======  =======  =======  =======  =======  =======  ======= 
 

10. Risks and uncertainties

Under the Disclosure and Transparency Directive, the Board is required in the Company's half-yearly results to report on principal risks and uncertainties facing the Company over the remainder of the financial year.

The Board has concluded that the key risks facing the Company over the remainder of the financial period are as follows:

   -- investment risk associated with investing in small and immature 
      businesses; 
 
   -- liquidity risk arising from investing mainly in unquoted businesses; and 
 
   -- failure to maintain approval as a VCT. 

In all cases the Board is satisfied with the Company's approach to these risks. As a VCT, the Company is forced to have significant exposure to relatively immature businesses. This risk is mitigated to some extent by holding a well-diversified portfolio.

With a reasonably illiquid venture capital investment portfolio, the Board ensures that it maintains an appropriate proportion of its assets in cash and liquid instruments.

The Company's compliance with the VCT regulations is continually monitored by the Administration Manager, who regularly reports to the Board on the current position. The Company also retains Philip Hare and Associates LLP to provide regular reviews and advice in this area. The Board considers that this approach reduces the risk of a breach of the VCT regulations to a minimal level.

The Company has considerable financial resources at the period end and holds a diversified portfolio of investments. As a result, the Directors believe that the Company is well placed to manage its business risks successfully despite the current uncertain economic outlook.

The Directors have concluded 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 financial statements.

11. The Directors confirm that, to the best of their knowledge, the half-yearly financial statements have been prepared in accordance with the "Statement: Half-Yearly Financial Reports" issued by the UK Accounting Standards Board as well as in accordance with FRS 104 Interim Financial Reporting and the half-yearly financial report includes a fair review of the information required by:

(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the current financial year and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the year; and

(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period, and any changes in the related party transactions described in the last Annual Report that could do so.

12. The unaudited financial statements set out herein do not constitute statutory accounts within the meaning of Section 434 of the Companies Act 2006 and have not been delivered to the Registrar of Companies. The figures for the period ended 31 March 2022 have been extracted from the financial statements for that period, which have been delivered to the Registrar of Companies; the Auditor's report on those financial statements was unqualified.

13. Copies of the unaudited Half-Yearly Report will be sent to Shareholders shortly. Further copies can be obtained from the Company's registered office or downloaded from www.moltenventures.com and the Administrator's site at www.downing.co.uk.

 
 

(END) Dow Jones Newswires

December 09, 2022 06:28 ET (11:28 GMT)

Copyright (c) 2022 Dow Jones & Company, Inc.
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