TIDMFTV
FORESIGHT VCT PLC
LEI: 213800GNTY699WHACF46
25 April 2023
Final results
31 December 2022
Foresight VCT plc, managed by Foresight Group LLP, today
announces the final results for the year ended 31 December
2022.
These results were approved by the Board of Directors on 25
April 2023.
The Annual Report will shortly be available in full at
www.foresightgroup.eu. All other statutory information can also be
found there.
Highlights
-- Total net assets GBP191.7 million.
-- A final dividend of 4.5p per share was paid on 24 June 2022, costing
GBP10.0 million.
-- A special interim dividend of 4.0p per share was paid on 21 October 2022,
costing GBP8.8 million.
-- Net Asset Value per share decreased by 2.9% from 90.1p at 31 December
2021 to 87.5p at 31 December 2022. After adding back the payments of a
4.5p dividend made on 24 June 2022 and a 4.0p dividend made on 21 October
2022, NAV Total Return per share was 96.0p, bringing the total return in
the year to 6.5%.
-- Four new investments costing GBP6.8 million and three follow-on
investments costing GBP3.3 million were made during the year.
-- The value of the investment portfolio rose by GBP2.8 million in the year
to 31 December 2022. This was driven by an increase of GBP14.6 million
(2021: GBP42.0 million) in the valuation of investments, plus GBP10.1
million of new investments offset by sales of investments totalling
GBP21.9 million.
-- The offer for subscription launched in January 2023 was closed on 13
April 2023 and raised a total of GBP23.1 million after expenses.
-- The Board is recommending a final dividend for the year ended 31 December
2022 of 4.4p per share, to be paid on 30 June 2023.
Chair's statement
I am pleased to present the Company's audited Annual Report and
Accounts for the year ended 31 December 2022 and to report a Net
Asset Value Total Return of 6.5% for the year and a dividend yield
of 11.1% including a special dividend.
Margaret Littlejohns, Chair of Foresight VCT plc
Overview of 2022
The Net Asset Value ("NAV") Total Return per share of 6.5% for
2022 represents a good investment performance by the Company in the
context of a particularly challenging macroeconomic environment
throughout the year.
While the impact of COVID-19 had receded by the start of the
year, the Russian invasion of Ukraine in February created an
economic and geopolitical upheaval across the globe. Financial and
trade sanctions imposed on Russia in response to the conflict
increased the cost of energy and food and resulted in worldwide
inflationary pressures and further disruption of supply chains,
already under strain from the pandemic. The portfolio has some
limited direct exposure to Russia and Ukraine, including a small
proportion of customers, staff and contractors in both countries,
but this remains manageable and supply chains to date have not been
significantly disrupted. Rising inflation and interest rates,
however, affected consumer and business confidence and,
particularly in the UK, reduced growth prospects during 2022.
Against this backdrop, the Manager worked closely with management
teams of investee companies to prepare and plan for a weakening
economy.
The Company's portfolio in aggregate has remained resilient amid
this economic and political turmoil during the year. Many of the
portfolio companies successfully adapted to the new economic
landscape, with some performing extremely well and demonstrating
the strength of their management teams. A minority struggled as a
result of a fall in consumer demand and inflationary pressures,
especially surging energy prices. However, these businesses are now
beginning to show signs of recovery.
At the end of 2022, 26 companies still held in the portfolio
recorded a combined increase in unrealised value of GBP19.8
million, offset by 16 companies still held in the portfolio
recording an aggregate fall in unrealised value of GBP14.0
million.
Three investments were sold in full generating net gains in
valuation of GBP8.8 million. Of particular note was the successful
sale of Codeplay Software in May 2022, which generated a multiple
of over 15 times the original cost of GBP0.7 million paid by the
Company in 2018.
Strategy
The Board and the Manager continue to pursue a strategy for the
Company which includes the following four key objectives:
-- Growth in Net Asset Value Total Return above a 5% target while continuing
to grow the Company's assets
-- Payment of annual ordinary dividends of at least 5% of the NAV per share
per annum (based on the latest announced NAV per share) while
endeavouring, at a minimum, to maintain the NAV per share on
a year--on--year basis
-- The implementation of a significant number of new and follow-on
qualifying investments every year, exceeding deployment requirements to
maintain VCT status
-- Maintaining a programme of regular share buybacks at a discount of no
less than 7.5% (2021: 10%) to the prevailing NAV per share
The Board and the Manager believe that these key objectives
remain appropriate and the Company's performance in relation to
each of them over the past year is reviewed in more detail
below.
Net Asset Value and dividends
The NAV of the Company grew over the financial year from
GBP185.1 million to GBP191.7 million at 31 December 2022, which is
in line with the Board's objective of growing the Company's
assets.
At the end of 2022, 89% of the Company's assets were already
invested and the Board believed it would be in the Company's best
interest to raise further funds to provide liquidity for its
activities in 2023 and beyond. On 20 January 2023, the Company
launched an offer for subscription to raise up to GBP20 million,
with an over--allotment facility to raise up to a further GBP10
million, through the issue of new shares. The offer was closed on
13 April 2023 having raised gross proceeds of GBP24.1 million,
GBP23.1 million after expenses, as detailed in the post-balance
sheet events note 20 of the Annual Report and Accounts.
During the year, the previous offer was closed to applications
on 7 April 2022 and raised gross funds of GBP24.1 million. We would
like to thank those existing shareholders who have supported these
offers and welcome all new shareholders to the Company.
The Company paid two dividends during the year: a dividend of
4.5p per share paid on 24 June 2022 which represented 5% of the NAV
per share as at 31 December 2021 and a special dividend of 4.0p per
share paid on 21 October 2022, following the successful
realisations of TFC Europe and Codeplay Software. Our objective of
maintaining NAV per share was met after paying the first dividend,
but the distribution of the special dividend reduced the NAV per
share to 87.5p at 31 December 2022, a reduction of 2.6p from 90.1p
at 31 December 2021. After adding back both dividends, the NAV
Total Return per share for the year was 96.0p, representing a total
return of 6.5%.
The total return per share from an investment in the Company's
shares made five years ago is 41.3%, which is above the minimum
target return set by the Board of 5% per annum. Exceeding this
target is at the centre of the Company's current and future
portfolio management objectives.
The Board is recommending a final dividend for the year ended 31
December 2022 of 4.4p per share, to be paid on 30 June 2023 based
on an ex-dividend date of 15 June 2023, with a record date of 16
June 2023. At the year end, distributable reserves totalled
GBP64,303,000 (2021: GBP81,536,000).
The Company continues to achieve its target dividend yield of 5%
of NAV, which was set in 2019 in light of the change in portfolio
towards earlier-stage, higher-risk companies, as required by the
VCT rules. The Board and the Manager hope that this level may be
exceeded in future by payment of additional "special" dividends as
and when particularly successful portfolio disposals are
achieved.
Investment performance and portfolio activity
A detailed analysis of the investment portfolio performance over
the year is given in the Manager's Review.
In brief, during the year under review, the Manager completed
four new investments, in a range of sectors, and three follow-on
investments costing GBP6.8 million and GBP3.3 million respectively.
The Company also disposed of three investments, generating proceeds
of GBP19.9 million with a further GBP0.9 million of deferred
consideration included within debtors at the year end, representing
a combined return multiple of 5.3x. Three loan principal repayments
were also received in the year totalling GBP2.0 million.
The Board and the Manager are confident that a more significant
number of new and follow-on investments can be achieved in 2023 as
the economy continues to recover and more opportunities emerge.
After the year end, the Company made four new investments
totalling GBP4.9 million in Sprintroom Limited (GBP1.0 million),
Firefish Software Limited (GBP1.5 million), Five Wealth Limited
(GBP0.7 million) and Red Flag Alert Limited (GBP1.7 million). The
Company also completed four follow--on investments with an
aggregate cost of GBP2.8 million in IMMJ Systems Limited (GBP0.6
million), NorthWest EHealth Limited (GBP1.5 million), Ten Health
& Fitness Limited (GBP0.6 million) and Additive Manufacturing
Technologies Ltd (GBP0.1 million). Furthermore, the Company
realised its holdings in Mowgli Street Food Limited, Innovation
Consulting Group Limited and Datapath Group Limited. The three
exits combined generated proceeds of GBP15.4 million at completion
with a further GBP2.8 million of deferred consideration due over
the next 24 months. Including cash returned to the date of this
report, the exits have delivered an impressive aggregate return
multiple of 5.8 times the original investment. Further details of
these investments and realisations can be found in the Manager's
Report.
The Company and Foresight Enterprise VCT plc have the same
Manager and share similar investment policies. The Board closely
monitors the extent and nature of the pipeline of investment
opportunities and is reassured by the Manager's confidence in being
able to deploy funds without compromising quality and to satisfy
the investment needs of both companies.
Responsible investing
The analysis of environmental, social and governance ("ESG")
issues is embedded in the Manager's investment process and these
factors are considered key in determining the quality of a business
and its long-term success. Central to the Manager's responsible
investment approach are five ESG principles that are applied to
evaluate investee companies, acquired since May 2018, throughout
the lifecycle of their investment, from their initial review and
acquisition to their final sale. Every year, these portfolio
companies are assessed and progress is measured against these
principles. More detailed information about the process can be
found on pages 44 to 46 of the Manager's Review of the Annual
Report and Accounts.
Buybacks
During the year the Company repurchased 11,429,802 shares for
cancellation at an average discount of 10.0%, achieving its former
objective of maintaining regular share buybacks at a discount of
10.0%. As noted above and in the January 2023 Prospectus, the Board
now has a current objective of maintaining a programme of regular
share buybacks at a discount of no less than 7.5% to the prevailing
NAV per share. The Board and the Manager consider that the ability
to offer to buy back shares at no less than 7.5% is fair to both
continuing and selling shareholders, and continues to help underpin
the discount to NAV at which the shares trade.
Share buybacks are timed to avoid the Company's closed periods.
Buybacks will generally take place, subject to demand, during the
following times of the year:
-- April, after the Annual Report has been published
-- June, prior to the Half-Yearly reporting date of 30 June
-- September, after the Half-Yearly Report has been published
-- December, prior to the end of the financial year
Management charges, co-investment and performance incentive
The annual management fee is an amount equal to 2.0% of net
assets, excluding cash balances above GBP20 million, which are
charged at a reduced rate of 1.0%. This has resulted in ongoing
charges for the period ended 31 December 2022 of 2.2%, which is at
the lower end of the range when compared to competitor VCTs.
Since March 2017, co-investments made by the Manager and
individual members of the Manager's private equity team have
totalled GBP1.1 million alongside the Company's investments of
GBP81.0 million. The co-investment scheme requires that the
individual members of the team invest in all of the Company's
investments from that date onwards and prohibits selective "cherry
picking" of co--investments. If any individual team member opts out
of co-investment, they cannot invest in anything during that year.
The Board believes that the co-investment scheme aligns the
interests of the Manager's team with those of shareholders and has
contributed to the gradual improvement in the Company's investment
performance.
In addition to the co-investment scheme, a performance incentive
scheme has been in place since 2017. The performance incentive
scheme only applies after an investment has been sold and the
scheme incorporates three different hurdles, all of which need to
be achieved at different stages before any performance fee can be
paid: an Investment Growth Hurdle for the individual investment at
exit and also two NAV Total Return Hurdles, the first upon the exit
of the investment and the second three years later. The NAV Total
Return Hurdle increases each year, so the second NAV Total Return
Hurdle will be higher than the first. Despite continued improvement
in the Company's net asset performance and in its NAV Total Return
per share, increases in RPI inflation have resulted in the initial
NAV Total Return Hurdle under the arrangement not being met at the
date of relevant realisations in the year or as at 31 December
2022.
As at 31 December 2022, the individual Investment Growth Hurdles
have been met for three realised and 14 unrealised investments out
of the 35 new early--stage investments made since the introduction
of the performance incentive arrangements and a contingent
liability of GBP7.2 million in respect of this is disclosed in note
15 of the Annual Report and Accounts. At the date of this report,
the Company has not paid fees in relation to the scheme.
The Board has been pleased to note good performance in recent
years and several strong exits, including the exceptional exits of
Codeplay for 15.4 times and TFC for 12.6 times the respective
initial investment. However, despite strong performance the current
performance incentive arrangement has not crystalised into
performance related payments. The current performance incentive
arrangements were introduced during a period of low interest rates
and inflation in the UK. In light of recent economic conditions, in
particular rises in inflation, the hurdles under the current
arrangements have become extremely difficult to achieve even where
there is exceptional investment performance. In addition, the
arrangements are complex and require onerous assessment and
monitoring with any payment being made long after the relevant
investment exit. The Board has, therefore, been considering revised
arrangements which better incentivise the Manager's performance and
are simpler to implement and understand, whilst continuing to align
with the interests of shareholders.
The new arrangements will supersede the current scheme and any
potential outstanding liabilities relating to it will end. Going
forward, it is proposed that the Manager be able to earn an annual
performance incentive fee as summarised below.
A performance incentive fee would be payable in respect of each
financial year commencing on or after 1 January 2023 where the
Company achieves an average annual NAV Total Return per share, over
a rolling five year period, in excess of an average annual hurdle
of 5%. In respect of the relevant financial year, the average
annual NAV Total Return per share is the total movement in Net
Asset Value per share plus dividends from the start of the four
preceding years to the end of that financial year (i.e. a rolling
five year period) divided by five. The average annual hurdle is an
average return of 5% per annum (simple, not compounded) over that
same rolling five year period from the opening Net Asset Value per
share at the beginning of that rolling five year period. If the
hurdle is met, the Manager would be entitled to an amount equal to
20% of the excess over the hurdle subject to a cap of 1% of the
closing Net Asset Value for the relevant financial year (and no fee
will be due in excess of this cap). Where there is a negative
return in the relevant financial year no fee shall be payable even
if the hurdle is exceeded. However, the potential fee will be
carried forward and will become due at the end of the next
financial year if the performance hurdle described above for that
next financial year is achieved and the negative return in the
preceding financial year is recovered in that next financial year.
Any such catch up fees shall be paid alongside any fee payable for
the next financial year subject to the 1% cap applying to both fees
in aggregate. Any such catch up fees cannot be rolled further
forward to subsequent financial years. The new arrangements will be
subject to continual review by the Board to ensure continued
alignment with the interests of shareholders.
These proposals, which have not yet been entered into, will
constitute a related party transaction under the Listing Rules of
the Financial Conduct Authority and will, before they can be
implemented, require a 'fair and reasonable' opinion from a sponsor
and also the approval of shareholders. A circular to shareholders
setting out further details and convening a general meeting to seek
such approval will be sent to shareholders in due course.
More information on the current performance incentive
arrangements (including an explanation of terms used above) can be
found in note 13 of the Annual Report and Accounts.
Board composition
The Board continues to review its own performance and undertakes
succession planning to maintain an appropriate level of
independence, experience, diversity and skills in order to be in a
position to discharge its responsibilities. 2023 has seen some
planned changes to the composition of the Board.
The Board was delighted to appoint David Ford and Dan Sandhu as
Non-Executive Directors in January 2023. Details of David and Dan's
experience and expertise can be found in their biographies on page
53 of the Annual Report and Accounts.
After over 16 years as a Non-Executive Director, including
nearly 12 years as Chair of the Audit Committee, Gordon Humphries
will not stand for re-election at the AGM on 15 June 2023. On
behalf of the Company, I would like to thank Gordon for his
significant contribution and dedication to the Company, which has
benefited enormously from his wise counsel during his many years of
service. We will miss Gordon and we wish him the very best for the
future.
Gordon will be succeeded as Chair of the Audit Committee by
Patty Dimond, who has already served on the Board for two years.
Patty qualified with Deloitte Haskins & Sells as a Chartered
Accountant and has experience as a current chair of the audit
committee of Hilton Food Group plc and a former chair of the audit
committee of LXi REIT plc, both FTSE 350 companies.
The Nomination Committee will continue its plans to refresh the
Board over the coming year and aims to achieve a sensible balance
between continuity and reinvigoration in compliance with the AIC
Code. It is expected that the Board will revert to four Directors
in 2024.
Shareholder communication
We were delighted to meet once again with some shareholders in
person at the AGM on 31 May 2022, having long been unable to do so
as a result of the travel restrictions due to COVID-19.
Arrangements were also made to enable shareholders to attend
online. However, very few took advantage of this facility and the
Board has decided, in view of the considerable cost of providing
it, not to repeat this in 2023. Additionally, the Manager once
again reintroduced in-person investor forum events in the year
which have proven popular with our shareholders in the past.
Annual General Meeting
The Company's Annual General Meeting will take place on 15 June
2023 at 2.00pm and we look forward to meeting as many of you as
possible in person. Please refer to the formal notice on page 99 of
the Annual Report and Accounts for further details in relation to
the format of this year's meeting. We would encourage you to submit
your votes by proxy ahead of the deadline of 2.00pm on 13 June 2023
and to forward any questions by email to
InvestorRelations@foresightgroup.eu in advance of the meeting.
Sunset clause
The "Sunset Clause" for EIS and VCT reliefs has to be reviewed
by the government by 6 April 2025. The clause provides that income
tax relief will no longer be given to subscriptions made on or
after 6 April 2025, unless the legislation is amended to make the
scheme permanent, or the "sunset clause" is extended. The
government has the power to extend or remove the sunset clause
through secondary legislation, which would allow the VCT & EIS
schemes to operate in their current form beyond the current expiry
date of the scheme. The then Chancellor Kwasi Kwarteng announced
during his mini-budget of 23 September 2022 that venture capital
schemes will be safeguarded beyond 2025 but no further details were
given as to how this will be implemented. To date, the now
Chancellor Jeremy Hunt has yet to clarify. However, through
correspondence with the Treasury Select Committee, the Chancellor
has stated that it is the government's firm intention to extend the
VCT and EIS schemes beyond the sunset on 6 April 2025 and that
further details will be provided in due course. The Treasury Select
Committee also notes that the UK should be able to extend the
scheme without European Commission approval, clarified by the
recently announced Northern Ireland Protocol, the Windsor
Framework.
Outlook
Growth in the UK is likely to be sluggish in 2023 and the
prospects for many other countries are also uncertain. The economic
impact of the war in Ukraine is likely to persist; ongoing
inflationary pressures, tighter monetary policies and supply chain
issues may continue to hinder economic recovery. Furthermore, the
collapse of Silicon Valley Bank in March 2023 increased turmoil in
financial markets. We are conscious that such conditions could
prove challenging for our investee companies which are unquoted,
small, early-growth businesses and by their nature entail higher
levels of risk and lower liquidity than larger listed
companies.
However, the Manager understands well the management and
business requirements of each of the companies within the
investment portfolio and is working closely with them to help them
adapt to, and grow within, this changing environment. The Company's
current portfolio of investments is well diversified by number,
business sector, size and stage of development and overall has
already demonstrated its relative resilience in the face of
economic and geopolitical difficulties.
The fundraising referred to earlier will provide additional
resources to make new acquisitions and enable the Company to
continue to take advantage of the increasing numbers of investment
opportunities that are now emerging out of the recent disruption.
Although there will be considerable economic headwinds in the year
ahead, we believe the diversified portfolio is well positioned to
generate long-term value for shareholders.
Margaret Littlejohns
Chair
25 April 2023
Manager's review
The Board has appointed Foresight Group LLP ("the Manager") to
provide investment management and administration services.
Portfolio summary
As at 31 December 2022, the Company's portfolio comprised 50
investments with a total cost of GBP103.8 million and a valuation
of GBP169.8 million. The portfolio is diversified by sector,
transaction type and maturity profile. Details of the ten largest
investments by valuation, including an update on their performance,
are provided on pages 28 to 32 of the Annual Report and
Accounts.
In the year, the value of the investment portfolio rose by
GBP2.8 million as a result of an increase of GBP14.6 million in the
valuation of investments, plus GBP10.1 million of new investments
offset by sales of investments totalling GBP21.9 million. Overall,
the portfolio has performed well despite uncertainty in the markets
following the impact of COVID-19 and subsequent geopolitical
uncertainty and price inflation.
In line with the Board's strategic objectives, the Manager
remains focused on growing the Company through further development
of Net Asset Value Total Return whilst paying an annual dividend to
shareholders of at least 5% of the latest announced NAV per share.
In the year, Net Asset Value Total Return was 6.5%, net assets
increased 3.6% to GBP191.7 million and dividends of 9.4% of the NAV
per share as at 31 December 2021 were paid, meaning that the
Company has successfully met these objectives.
New investments
2022 was a mixed year in the markets, with the technology sector
in particular performing strongly early in 2022 but then seeing a
significant softening. Many investee management teams have
successfully steered their businesses through the uncertainty of
2022, whilst developing clearer medium and longer-term growth
plans.
The Manager has invested further in its origination capabilities
and identified a large number of potentially attractive investment
opportunities during the year.
Over the course of 2022, four new investments were completed,
investing a total of GBP6.8 million. New investments were across
compliance technology, health services, advanced materials and
insure-tech. Behind these, there continues to be a strong pipeline
of opportunities that the Manager expects to convert during the
next 12 months. Follow-on investments totalling GBP3.3 million were
also made in three existing investee companies.
Homelink Healthcare Limited
In March 2022, the Company invested GBP1.1 million in Homelink
Healthcare, a specialist provider of hospital--at--home and virtual
ward services. The business employs highly qualified and
experienced nurses and rehabilitation teams to provide services to
patients in their own homes through contracts with the NHS. These
services deliver a range of clinical interventions, including wound
care, intravenous therapies, physiotherapy and rehabilitation. The
nurses are paid in-line with NHS remuneration and the clinical
services offered alleviate pressure on the NHS by freeing up vital
bed space, saving time and reducing costs.
So-Sure Limited
In May 2022, the Company invested GBP1.6 million in So--Sure, a
digital tech platform that operates across the entire insurance
supply chain, automating much of the process from distribution and
policy administration to fraud detection and claim management. The
investment will be used to scale up the business by investing into
marketing, technology and to improve platform automation.
Strategic Software Applications Ltd
In August 2022, the Company invested GBP1.7 million in Strategic
Software Applications, which trades under the name Ruleguard, a
London-based SaaS technology provider supporting financial
institutions in meeting their regulatory compliance obligations.
The platform enables customers to navigate the ever--growing
challenges of increasing regulatory compliance requirements with
efficiency, reduced risk and lower audit compliance costs. The
investment will help the company to develop additional platform
capabilities while scaling up sales and marketing functions to
capitalise on a large and growing market opportunity.
Copptech UK Limited
In August 2022, the Company made a GBP2.4 million investment in
Copptech, a developer of environmentally friendly antimicrobial
technologies that kill bacteria, fungi and viruses. Applications
for the technology are wide ranging and include diminishing the
transmission of viruses in medical facilities, extending the shelf
life of perishable goods, reducing discolouration and odour in
clothing and providing mould, fungi and termite--resistant
properties to building materials. The business has proven itself to
be highly scalable across Latin America and is already seeing
meaningful traction in the large North American and European
markets, where it is expanding its sales teams and operations. The
investment will enable Copptech to scale the business and operate
globally.
Follow-on investments
The Manager had expected that more portfolio companies would
need additional capital to support them through continued difficult
trading conditions resulting from macroeconomic challenges and
political uncertainty affecting energy and supply prices. However,
the portfolio has remained relatively resilient.
The Manager has arranged follow-on investments in three
companies during 2022, totalling GBP3.3 million. Further details of
each of these are provided below.
The additional equity injections in the year were mainly used to
support each company's further growth plans, such as launching new
products or to expand into new markets. In view of the difficult
economic outlook, the Manager remains vigilant about the health of
the rest of the portfolio and the need for follow-on funding over
the coming months.
Rovco Ltd
In March 2022, Rovco, a leading provider of autonomous and
cloud-managed robotics for subsea surveys in offshore wind and oil
field decommissioning, received a GBP0.5 million follow-on
investment from the Company as part of a larger round with various
new institutional investors. The investment will be used to further
develop Rovco's technical capabilities and alleviate pressure on
working capital requirements.
Hexarad Group Limited
In August 2022, a GBP0.7 million follow-on investment was made
in Hexarad, an early-stage, high-growth healthcare technology
company, providing teleradiology services to NHS Trusts and UK
private healthcare customers. The investment will be used to
accelerate the company's growth plans in response to significant
market demand.
Spektrix Limited
In November 2022, a follow-on investment of GBP2.0 million was
made in Spektrix, alongside a US institutional investor. Spektrix
is an enterprise software company providing ticketing, CRM,
marketing and fundraising software to companies in the performing
arts sector. The investment will be used to support growth plans
for the business.
Realisations
The M&A climate was robust, particularly in the first half
of 2022 and the Manager was pleased to report some particularly
strong realisations, as well as a disposal of a challenged
portfolio business. The Manager continues to engage with a range of
potential acquirers of several portfolio companies, with demand for
these high-growth businesses demonstrated by both private equity
and trade buyers.
Online Poundshop Limited
In February 2022, the Company sold its holding in Online
Poundshop to Poundland, one of the UK's largest single price
retailers. Unfortunately, Online Poundshop's business model had
proven challenging for some time and despite revenue growth and a
near break-even position it was unsustainable in the existing
ownership structure. A dual track fundraising and trade exit
process was launched and whilst there were several expressions of
interest from UK retailers, ultimately Poundland were the most
deliverable and committed to continuing to increase employment in
the West Midlands. The transaction generated GBPnil proceeds on the
Company's GBP2.6 million investment.
TFC Europe Limited
In June 2022, the Company sold its holding in TFC, a
market-leading manufacturing operations services provider, to AFC,
an Ohio-based distributor of fasteners backed by Bertram Capital, a
California--based mid--market private equity house. This resulted
in proceeds of GBP10.3 million, representing a particularly strong
return of 12.6x the original investment made by Foresight 2 VCT
plc, which merged with the Company in December 2015.
With offices in the UK and Germany, TFC is predominantly a
supplier of technical fasteners across Europe. Since the original
investment, the Manager had taken a proactive approach to
supporting TFC, helping to extend its network in the UK and
Germany. TFC rapidly expanded its vendor managed inventory service,
grew its customer base, and became a market-leading service
provider to SMEs and international global brands operating across a
range of industries. The Manager supported three acquisitions as
well as considerable investment in new and existing facilities,
opening new sites in England, Northern Ireland and Czechia.
Codeplay Software Limited
In June 2022, the Company completed the sale of Codeplay, one of
the UK's leading providers of solutions for the semiconductor
industry, to a leading US chip manufacturer.
Since the Manager's investment in 2018, Codeplay continued to
develop a suite of high-performance software assets and is
positioned at the centre of an increasingly important ecosystem
that improves the performance of chips, used in high-performance
and low-power environments, from supercomputers to self-driving
cars. It has also developed new routes to market, selling its
solutions to chip companies and downstream users, such as
manufacturers of diagnostic healthcare equipment.
This transaction generated proceeds of GBP9.6 million,
representing an exceptional return of 15.4x and an IRR of nearly
100%.
Realisations in the year ended 31 December 2022
Valuation
Accounting at
cost at
date Realised 31 December
of
disposal Proceeds gain/(loss) 2021
Company Detail (GBP) (GBP) (GBP) (GBP)
TFC Europe Full
Limited disposal 3,614,612 10,271,922 6,657,310 6,887,033
Codeplay
Software Full
Limited(1) disposal 689,656 9,582,978 8,893,322 4,099,278
Spektrix Loan
Limited repayment 1,442,000 1,442,000 -- 1,442,000
Specac
International Loan
Limited repayment 500,000 500,000 -- 500,000
Positive
Response
Communications Loan
Limited repayment 125,000 125,000 -- 125,000
Online
Poundshop Full
Limited disposal 2,610,000 -- (2,610,000) --
Total disposals 8,981,268 21,921,900 12,940,632 13,053,311
1. A further GBP930,000 of deferred consideration has been reflected in the
accounts.
Pipeline
At 31 December 2022, the Company had cash reserves of GBP19.5
million, which will be used to fund new and follow--on investments,
buybacks and running expenses. The Manager is seeing its pipeline
of potential investments grow and has a number of opportunities
under exclusivity or in due diligence, which continue to
progress.
The volatility caused by political uncertainty, rising energy
costs and broader price inflation resulted in a challenging period
for many companies, with staff retention and exaggerated wage
expectations causing concern for many. This does, however, create
opportunities, and the Manager is well placed to consider these as
they arise, whilst supporting existing portfolio companies with
follow-on investments as needed.
In the medium term and long term, the Manager expects that
current unpredictability will present attractive investment
opportunities. It is able to access these opportunities through its
wide and proprietary network of contacts around the country, and
considers the Company's strategy to be well-suited to market
volatility, due to its balanced mix of companies across sectors and
stages, experienced investment team and network of high--quality
chairs.
Post year end activity
Sprintroom Limited
In January 2023, GBP1.0 million of growth capital was invested
in Sprintroom, which trades as Sprint Electric. The business
designs and manufactures drives for controlling electric motors in
light and heavy industrial applications, as well as recovering and
reusing otherwise lost energy. The investment will be used to
further develop and commercialise novel alternating current
variable speed drive technology.
IMMJ Systems Limited
In February 2023, GBP0.6 million was invested in IMMJ, a
clinical electronic document management solution supplier to the
NHS. The investment will be used to grow the leadership team and
bolster the business' abilities to support the digitisation of
records, providing easy and efficient access to patient records for
clinical care across the NHS.
Firefish Software Limited
In March 2023, the Company invested GBP1.5 million in Firefish
Software Limited, a Glasgow based customer relationship management
and marketing software platform targeting the recruitment sector.
The funding will be used to further develop the platform in order
to attract a larger enterprise level customer base and expand its
outbound sales team.
NorthWest EHealth Limited
In March 2023, the Company invested GBP1.5 million in NorthWest
EHealth, which provides software and services to the clinical
trials market, allowing pharmaceutical companies and contract
research organisations to conduct feasibility studies, recruit
patients and run trials. The investment will be used to support the
delivery of a 100% growth in real world trial delivery in FY23,
while completing building the company's Connexon platform; to be
compatible with all UK healthcare data sources by year end.
Ten Health & Fitness Limited
In March 2023, Ten Health, a multi-site operator in the boutique
health, wellbeing and fitness market, received an additional
investment of GBP0.6 million. The funding will enable the company
to complete its new flagship Kings Cross site and support the
company's transition to profitability from Q1 2023.
Five Wealth Limited
In March 2023, the Company invested GBP0.7 million in Five
Wealth, an established boutique financial planning business
operating across the North West of England, headquartered in
Manchester. This growth capital investment will be used to support
increased marketing and advertising to drive top line growth and
greater regulatory and compliance costs which are forecast to
increase commensurately with AUM.
Red Flag Alert Limited
In March 2023, the Company invested GBP1.7 million in Reg Flag
Alert, a Manchester based proprietary SaaS intelligence platform
with modular capabilities spanning compliance, prospecting, risk
management and financial health assessments. The growth capital
will be used to expand the sales team and alongside an increased
marketing budget is expected to accelerate new client
acquisition.
Additive Manufacturing Technologies Ltd ("AMT")
In April 2023, the Company invested GBP0.1 million in AMT, which
manufactures systems that automate the post--processing of 3D
printed parts. The investment will be used to cover short-term
working capital requirements, as the business continues to grow
sales and pushes towards sustainable profitability.
Mowgli Street Food Group Limited
In January 2023, the Company announced the successful exit of
casual Indian food chain Mowgli to TriSpan, a global private equity
firm with extensive restaurant expertise. The Manager invested in
2017, when the business had three restaurant sites. It has since
grown to 15 sites nationally. The Manager introduced Dame Karen
Jones as chair, Matt Peck as finance director and helped recruit
Lucy Worth as operations director and together with this team built
a market-leading hospitality brand. The business also shared the
Manager's commitment to sustainability, creating more than 500 jobs
and ranking 16th best UK company to work for in 2022 owing to its
focus on employee welfare, local charity support and sustainable
sourcing.
The exit resulted in proceeds of GBP5.2 million, of which GBP1.6
million will be received over 12 months post the completion of the
exit, representing a return of 3.5x cost.
Innovation Consulting Group Limited ("GovGrant")
In March 2023, the Company announced the impressive exit of
GovGrant to Source Advisors, a US corporate buyer backed by BV
Investment Partners. GovGrant is one of the UK's leading providers
of R&D tax relief, patent box relief and other innovation
services. The transaction generated proceeds of GBP6.8 million at
completion. When added to GBP0.5 million of cash returned to date,
this implies a total cash-on-cash return of 4.4 times the capital
of GBP1.65 million invested in October 2015, equivalent to an IRR
of 24%.
Since the original investment in 2015, the Manager had helped
GovGrant through a period of material growth during which it
supported the R&D activities of a growing number of customers.
GovGrant's high levels of service and innovative products, such as
the growing patent box offering, have contributed to driving
innovation in the UK economy. The Manager had taken a proactive
approach to supporting the exceptional senior management team, all
of whom were introduced to the business during the investment
period.
Datapath Group Limited
In March 2023, the Company announced the notable exit of
Datapath, a global leader in the provision of visual solutions. The
transaction generated proceeds of GBP5.1 million at completion with
an additional GBP1.2 million payable over the next 24 months. When
added to GBP5.4 million of cash returned to date, this implies a
total cash-on-cash return of 11.7 times the original investment,
equivalent to an IRR of 38% since the initial investment in
2007.
Since the original investment, the Manager had supported
Datapath through a period of material growth with revenues growing
from approximately GBP7 million to GBP25 million. Datapath has
developed a market leading hardware and software product suite for
the delivery of multi-screen displays and video walls which are
sold globally to a diverse customer base across a range of
sectors.
Key portfolio developments
Material changes in valuation, defined as increasing or
decreasing by GBP1.0 million or more since 31 December 2021, are
detailed below. Updates on these companies are included below, or
in the Top Ten Investments section on pages 28 to 32 of the Annual
Report and Accounts.
Key valuation changes in the year
Company Valuation methodology Net movement (GBP)
------------------------------
Hospital Services Group Discounted earnings
Limited multiple 3,336,610
Discounted revenue
Callen-Lenz Associates Limited multiple 2,826,319
Price of last funding
Spektrix Limited round 2,390,122
Nano Interactive Group Limited Discounted offer received 1,674,441
Discounted revenue
Fourth Wall Creative Limited multiple 1,265,741
Vio Healthtech Limited Nil value (1,000,644)
Innovation Consulting Group
Limited Discounted offer received (1,652,336)
Datapath Group Limited Discounted offer received (1,836,068)
Biotherapy Services Limited Nil value (2,346,371)
Discounted revenue
Ollie Quinn Limited multiple (2,994,488)
------------------------------
Ollie Quinn Limited
Ollie Quinn is a branded retailer of prescription glasses,
sunglasses and non-prescription polarised sunglasses based in the
UK and Canada.
31 December 2022 update
Trading in the Canadian stores is robust, however the weaker
economic environment in the UK and particularly soft consumer
confidence has contributed to under--performance in the UK stores
in the latter part of 2022.
Vio Healthtech Limited
Vio Healthtech is a specialist women's health company, which has
developed a range of medical devices that predict ovulation to
support women trying to conceive. It is also developing digital
healthcare solutions (digital therapeutics) to support broader
health issues around the menopause and polycystic ovary
syndrome.
31 December 2022 update
The company has struggled to regain positive sales traction
post-pandemic and has had to significantly reduce spend on
marketing activities. Management continues to seek alternative
investment to support the ongoing transition to a digital
therapeutics model, including further new product development.
Biotherapy Services Limited
Biotherapy Services is an early-stage biopharma company that has
developed a platform treatment for use in wound healing, initially
for the treatment of diabetic foot ulcers but with additional use
in cardiac issues and lung treatments. The company had been
progressing a clinical trial.
31 December 2022 update
Recruitment into the RAPID gel trial has now been stopped as a
result of continued slow progress. The trial will be formally
closed to allow the publication of positive interim data. The
company is still attempting to raise funds; however, despite
several positive meetings, no heads of terms have been received and
there is a substantial risk that no additional funding can be
secured. If no funding is received, the company will pursue a
sale.
Outlook
2022 has been a year of volatility for most asset classes, as
rising inflation, increased energy costs and higher interest rates
impacted business performance, particularly in the second half of
the year. In global equity markets, the MSCI World Index fell by
10% over the 12 months, while the tech-heavy NASDAQ fell by more
than 30%.
In the UK, business and consumer confidence was dented by
political uncertainty and broader price inflation. Russia's
invasion of Ukraine had a particularly acute effect on the UK
economy as the price of electricity rose sharply due to the
country's reliance on natural gas for power generation. In many
markets, businesses began to invest in growth after an uncertain
COVID-19 period at the same time that global supply chain issues
resulted in long lead times for products, weighing on sales and
increasing working capital requirements. Many businesses in the
Company's portfolio faced challenges with both staff retention and
hiring, as the number of vacancies and wage inflation drove staff
churn. This required careful attention from management teams and
the Manager's board members, but often presented an opportunity to
focus on efficiency by retaining the best talent.
Despite this backdrop, the Company's portfolio performed
strongly in the year, achieving a 6.5% NAV Total Return for its
shareholders, with exceptional exits from the likes of TFC and
Codeplay contributing in the Company's dividend of 8.5p per share
for the year, representing an attractive 11.1% dividend yield. The
Company's strategy is well-suited to market volatility, given its
diverse sector allocation and the mix of later and earlier--stage
growth companies in the portfolio, many of which are profitable and
so typically more resilient in a downturn.
Looking forward to 2023, the UK market is likely to remain
unpredictable. While some forecasters are expecting interest rates
to peak in the summer, the labour market remains stubbornly tight
and inflation persistent, meaning that rates may remain elevated
for a longer period. While a recession has been avoided to date,
balancing rate increases with current low growth and productivity
rates is a difficult task for politicians and rate-setters. The
range of outcomes for SMEs is likely to be wide, and so a balanced
approach to portfolio construction is prudent, alongside providing
hands-on support for management teams as they navigate this
environment.
This is not a reason to be pessimistic. The UK remains a dynamic
economy, attracting some of the best global talent in technology,
life sciences, engineering and financial services among many
others, while its cities remain a destination for workers and
tourists alike. The Manager believes that the UK has great
potential in the medium and long term with many competitive
advantages over its neighbours and more distant trading partners,
and this temporary pullback is already presenting unique investment
opportunities, which we are able to access through our wide and
proprietary network of contacts around the country. A weaker
sterling also attracts overseas acquirers to the UK, such as the US
trade buyers for Codeplay, TFC and other exits.
The Manager is pleased with the overall performance of the
portfolio over the past 12 months, especially in these challenging
times, and looks forward to a further improvement as labour markets
loosen, inflation reduces and interest rates peak and reverse.
While the market remains uncertain, the Manager expects to see a
sustained high level of activity from UK companies seeking growth
capital and expects VCTs to remain an attractive source of capital
for entrepreneurs. This is driven by good relative performance of
the Company, supported by its diverse portfolio and high--touch
approach to supporting management teams and SMEs in achieving their
full potential.
James Livingston
on behalf of Foresight Group LLP
Co-Head of Private Equity
25 April 2023
Income statement
for the year ended 31 December 2022
Year ended 31 December 2022 Year ended 31 December 2021
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
--------------
Realised gains
on
investments -- 13,207 13,207 -- 13,070 13,070
Investment
holding
gains -- 2,138 2,138 -- 30,424 30,424
Income 1,536 -- 1,536 858 -- 858
Investment
management
fees (949) (2,550) (3,499) (772) (2,612) (3,384)
Other expenses (680) -- (680) (587) -- (587)
--------------
(Loss)/return
on ordinary
activities
before
taxation (93) 12,795 12,702 (501) 40,882 40,381
Taxation -- -- -- -- -- --
--------------
(Loss)/return
on ordinary
activities
after
taxation (93) 12,795 12,702 (501) 40,882 40,381
--------------
(Loss)/return
per share (0.1)p 5.9p 5.8p (0.2)p 19.9p 19.7p
--------------
The total columns of this statement are the profit and loss
account of the Company and the revenue and capital columns
represent supplementary information.
All revenue and capital items in the above Income Statement are
derived from continuing operations. No operations were acquired or
discontinued in the year.
The Company has no recognised gains or losses other than those
shown above, therefore no separate statement of total comprehensive
income has been presented.
The Company has only one class of business and one reportable
segment, the results of which are set out in the Income Statement
and Balance Sheet.
There are no potentially dilutive capital instruments in issue
and, therefore, no diluted earnings per share figures are relevant.
The basic and diluted earnings per share are, therefore,
identical.
The notes on pages 82 to 98 of the Annual Report and Accounts
form part of these financial statements.
Reconciliation of movements in shareholders' funds
Capital
Year ended Called-up Share premium redemption Distributable Capital Revaluation
31 December share capital account reserve reserve(1) reserve(1) reserve Total
2022 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
As at 1 January
2022 2,056 34,954 1,081 75,591 5,945 65,521 185,148
Share issues
in the year(2) 250 22,084 -- -- -- -- 22,334
Expenses in
relation to
share issues(3) -- (658) -- -- -- -- (658)
Repurchase
of shares (114) -- 114 (8,980) -- -- (8,980)
Realised gains
on disposal
of investments -- -- -- -- 13,207 -- 13,207
Investment
holding gains -- -- -- -- -- 2,138 2,138
Dividends
paid -- -- -- (18,817) -- -- (18,817)
Management
fees charged
to capital -- -- -- -- (2,550) -- (2,550)
Revenue loss
for the year -- -- -- (93) -- -- (93)
As at 31 December
2022 2,192 56,380 1,195 47,701 16,602 67,659 191,729
Called-up
share Share Capital
Year ended capital premium account Capital redemption reserve Distributable reserve(1) reserve(1) Revaluation reserve Total
31 December 2021 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
As at 1 January
2021 2,060 67,634 994 50,546 (4,513) 35,097 151,818
Share issues in
the year(2) 83 6,714 -- -- -- -- 6,797
Expenses in
relation to share
issues(3) -- (198) -- -- -- -- (198)
Repurchase of
shares (87) -- 87 (6,142) -- -- (6,142)
Cancellation of
share premium -- (39,196) -- 39,196 -- -- --
Realised gains on
disposal of
investments -- -- -- -- 13,070 -- 13,070
Investment holding
gains -- -- -- -- -- 30,424 30,424
Dividends paid -- -- -- (7,508) -- -- (7,508)
Management fees
charged to
capital -- -- -- -- (2,612) -- (2,612)
Revenue loss for
the year -- -- -- (501) -- -- (501)
As at 31 December
2021 2,056 34,954 1,081 75,591 5,945 65,521 185,148
1. Reserve is available for distribution; total distributable reserves at 31
December 2022 total GBP64,303,000 (2021: GBP81,536,000).
2. Includes the dividend reinvestment scheme.
3. Expenses in relation to share issues includes trail commission for prior
years' fundraising.
The notes on pages 82 to 98 of the Annual Report and Accounts
form part of these financial statements.
Balance sheet
At 31 December 2022
Registered number: 03421340
As at As at
31 December 31 December
2022 2021
GBP'000 GBP'000
----------------------------------------------------
Fixed assets
Investments held at fair value through profit or
loss 169,775 167,006
----------------------------------------------------
Current assets
Debtors 3,037 1,669
Cash and cash equivalents 19,525 17,521
----------------------------------------------------
22,562 19,190
Creditors
Amounts falling due within one year (608) (751)
----------------------------------------------------
Net current assets 21,954 18,439
Amounts falling due greater than one year -- (297)
----------------------------------------------------
Net assets 191,729 185,148
----------------------------------------------------
Capital and reserves
Called-up share capital 2,192 2,056
Share premium account 56,380 34,954
Capital redemption reserve 1,195 1,081
Distributable reserve 47,701 75,591
Capital reserve 16,602 5,945
Revaluation reserve 67,659 65,521
----------------------------------------------------
Equity shareholders' funds 191,729 185,148
Net Asset Value per share 87.5p 90.1p
----------------------------------------------------
The financial statements were approved by the Board of Directors
and authorised for issue on 25 April 2023 and were signed on its
behalf by:
Margaret Littlejohns
Chair
The notes on pages 82 to 98 of the Annual Report and Accounts
form part of these financial statements.
Cash flow statement
For the year ended 31 December 2022
Year ended Year ended
31
December 31 December
2022 2021
GBP'000 GBP'000
-----------------------------------------------------
Cash flow from operating activities
Loan interest received from investments 1,249 582
Dividends received from investments 132 384
Deposit and similar interest received 220 1
Investment management fees paid (3,789) (3,095)
Secretarial fees paid (130) (122)
Other cash payments (457) (462)
-----------------------------------------------------
Net cash outflow from operating activities (2,775) (2,712)
-----------------------------------------------------
Cash flow from investing activities
Purchase of investments (11,051) (15,111)
Proceeds on sale of investments 21,922 22,810
Proceeds on deferred consideration 266 --
-----------------------------------------------------
Net cash inflow from investing activities 11,137 7,699
-----------------------------------------------------
Cash flow from financing activities
Proceeds of fundraising 18,531 5,407
Expenses of fundraising (473) (164)
Repurchase of own shares (9,234) (5,496)
Equity dividends paid (15,182) (6,152)
-----------------------------------------------------
Net cash outflow from financing activities (6,358) (6,405)
-----------------------------------------------------
Net inflow/(outflow) of cash in the year 2,004 (1,418)
-----------------------------------------------------
Reconciliation of net cash flow to movement in net
funds
Increase/(decrease) in cash and cash equivalents for
the year 2,004 (1,418)
Net cash and cash equivalents at start of year 17,521 18,939
-----------------------------------------------------
Net cash and cash equivalents at end of year 19,525 17,521
-----------------------------------------------------
Analysis of changes in net debt
At At
1 January 31 December
2022 Cash flow 2022
GBP'000 GBP'000 GBP'000
--------------------------
Cash and cash equivalents 17,521 2,004 19,525
--------------------------
The notes on pages 82 to 98 of the Annual Report and Accounts
form part of these financial statements.
Notes
1. These are not statutory accounts in accordance with S436 of the Companies
Act 2006. The full audited accounts for the year ended 31 December 2022,
which were unqualified and did not contain statements under S498(2) of
the Companies Act 2006 or S498(3) of the Companies Act 2006, will be
lodged with the Registrar of Companies. Statutory accounts for the year
ended 31 December 2022 including an unqualified audit report and
containing no statements under the Companies Act 2006 will be delivered
to the Registrar of Companies in due course.
1. The audited Annual Financial Report has been prepared on the basis of
accounting policies set out in the statutory accounts of the Company for
the year ended 31 December 2022. All investments held by the Company are
classified as 'fair value through the profit and loss'. Unquoted
investments have been valued in accordance with IPEV guidelines. Quoted
investments are stated at bid prices in accordance with the IPEV
guidelines and Generally Accepted Accounting Practice.
1. Copies of the Annual Report will be sent to shareholders and can be
accessed on the following website: www.foresightvct.com.
1. Net Asset Value per share
The Net Asset Value per share is based on net assets at the end
of the year and on the number of shares in issue at that date.
31 December 31 December
2022 2021
--------------------------
Net assets GBP191,729,000 GBP185,148,000
No. of shares at year end 219,151,944 205,591,087
Net Asset Value per share 87.5p 90.1p
--------------------------
1. Return per share
Year ended Year ended
31 December 31 December
2022 2021
GBP'000 GBP'000
----------------------------------------------------
Total return after taxation 12,702 40,381
Total return per share (note a) 5.8p 19.7p
----------------------------------------------------
Revenue loss from ordinary activities after taxation (93) (501)
Revenue loss per share (note b) (0.1)p (0.2)p
----------------------------------------------------
Capital return from ordinary activities after
taxation 12,795 40,882
Capital return per share (note c) 5.9p 19.9p
----------------------------------------------------
Weighted average number of shares in issue in the
year (note d) 218,519,391 204,937,084
----------------------------------------------------
Notes:
1. Total return per share is total return after taxation divided by the
weighted average number of shares in issue during the year.
2. Revenue loss per share is revenue loss after taxation divided by the
weighted average number of shares in issue during the year.
3. Capital return per share is capital return after taxation divided by the
weighted average number of shares in issue during the year.
4. The weighted average number of shares is calculated by taking the number
of shares issued and bought back during the year, multiplying each by the
percentage of the year for which that share number applies and then
totalling with the number of shares in issue at the beginning of the
year.
1. Annual General Meeting
The Annual General Meeting of the Company will be held at the
offices of Foresight Group LLP, The Shard, 32 London Bridge Street,
SE1 9SG on 15 June 2023 at 2.00pm. Details will be published on
both the Company's and the Manager's website at
www.foresightvct.com.
1. Income
Year ended Year ended
31 December 31 December
2022 2021
GBP'000 GBP'000
--------------------------------------
Loan stock interest 1,184 473
Dividends receivable 132 384
Deposit and similar interest received 220 1
--------------------------------------
1,536 858
--------------------------------------
1. Investments held at fair value through profit or loss
2022 2021
GBP'000 GBP'000
--------------------------------
Unquoted investments 169,775 167,006
--------------------------------
GBP'000
--------------------------------
Book cost as at 1 January 2022 102,687
Investment holding gains 64,319
--------------------------------
Valuation at 1 January 2022 167,006
Movements in the year:
Purchases at cost 10,060
Disposal proceeds(1) (21,922)
Realised gains(2) 12,941
Investment holding gains(3) 1,690
--------------------------------
Valuation at 31 December 2022 169,775
--------------------------------
Book cost at 31 December 2022 103,766
Investment holding gains 66,009
--------------------------------
Valuation at 31 December 2022 169,775
--------------------------------
1. The Company received GBP21,922,000 (2021: GBP22,810,000) from the
disposal of investments during the year. The book cost of these
investments when they were purchased was GBP8,981,000 (2021:
GBP9,740,000). These investments have been revalued over time and until
they were sold any unrealised gains or losses were included in the fair
value of the investments.
2. Realised gains in the Income Statement include deferred consideration
receipts from Accrosoft Limited (GBP51,000), FFX Group Limited
(GBP155,000) and Ixaris Systems Ltd (GBP60,000).
3. Investment holding gains in the Income Statement include the deferred
consideration debtor increase of GBP448,000. The debtor movement reflects
the recognition of amounts receivable in respect of Codeplay Software
Limited (GBP930,000) and FFX Group Limited (GBP155,000), offset by
receipts in respect of Accrosoft Limited (GBP51,000), FFX Group Limited
(GBP155,000) and Ixaris Systems Ltd (GBP60,000) and provisions made
against balances in respect of Mologic Ltd. (GBP361,000) and Accrosoft
Limited (GBP10,000).
1. Related party transactions
No Director has an interest in any contract to which the Company
is a party other than their appointment and remuneration as
Directors.
1. Transactions with the Manager
Foresight Group LLP was appointed as Manager on 27 January 2020
and earned fees of GBP3,499,000 during the year (2021:
GBP3,087,000).
Foresight Group LLP is the Company Secretary (appointed in
November 2017) and received accounting and company secretarial
services fees of GBP130,000 (2021: GBP122,000) during the year. At
31 December 2022, the amount due to Foresight Group LLP was GBPnil
(2021: GBPnil).
No amounts have been written off in the year in respect of debts
due to or from the Manager.
END
For further information please contact:
Gary Fraser, Foresight Group: 020 3667 8181
(END) Dow Jones Newswires
April 25, 2023 12:06 ET (16:06 GMT)
Copyright (c) 2023 Dow Jones & Company, Inc.
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