TIDMGROW
RNS Number : 7935T
Molten Ventures PLC
29 November 2021
29 November 2021
Molten Ventures Plc
("Plc", "Molten Ventures", "the Group" or the "Company")
INTERIM RESULTS FOR THE SIX MONTHSED 30 SEPTEMBER 2021
Molten Ventures (LSE: GROW, Euronext Dublin: GRW), a leading
venture capital firm investing in and developing high growth
digital technology businesses, today announces its interim results
for the six-month period ended 30 September 2021.
FINANCIAL HIGHLIGHTS
-- Gross Portfolio Value of GBP1,350m (31 March 2021: GBP984m)
-- 27% Gross Portfolio fair value growth in the six-month period
to 30 September 2021 (six months to 30 September 2020: 10%)
-- Net assets of GBP1,357m (31 March 2021: GBP1,033m)
-- NAV per share increased to 887p (31 March 2021: 743p)
-- GBP156m available plc cash (31 March 2021: GBP161m)
-- GBP165m invested in the period (six months to 30 September 2020: GBP32m)
-- GBP108m net funds raised during the period
-- Cash realisations of GBP67m (six months to 30 September 2020: GBP106m)
-- Profit after tax of GBP218m (GBP54m for the six months to 30 September 2020)
-- Operating costs (net of fee income) continue to be less than
the targeted 1% of period-end NAV
OPERATIONAL HIGHLIGHTS
-- Cash proceeds from realisations during the period of GBP67m,
predominantly generated by the exits from SportPursuit,
Conversocial and PremFina, selling down some of our shares held in
publicly-listed Trustpilot
and UiPath, as well as escrow receipts relating to previously announced disposals
-- Cash investments of GBP165m, increasing deployment in excess
of levels initially anticipated for the full year. This is
attributable to a higher level of follow-on opportunities in the
existing portfolio, consistently leading rounds in primary
investments and the continued expansion of the investment platform
with further additions to the team
-- Committed to 12 new seed funds via our seed fund of funds
programme, bringing the overall seed portfolio to 47 funds
-- Completed move to the Premium Segment of the Official List
and to trading on the London Stock Exchange's Main Market, as well
as to the secondary listing segment of the Official List of
Euronext Dublin and to
trading on the regulated market of Euronext Dublin
-- Continued to progress our ESG roadmap, including advancing
our TCFD and carbon emission projects,
release of our Board Diversity and Inclusion policy, and engaging with the portfolio on ESG.
POST PERIOD-
-- In November 2021, to reflect our ambition to transform
venture capital, Draper Esprit unveiled a new name, Molten
Ventures, a new website, moltenventures.com, and a new motto "Make
More Possible". The new brand reflects our ongoing transformation:
the rapid acceleration of investment, our expanding team, and our
recent inclusion in the FTSE250
-- Post period-end, we have deployed GBP36.6 million in
investments including an investment in Satellite Vu, a British
start-up using satellite technology to determine valuable insights
into economic activity, energy efficiency and carbon footprint.
-- We have realised cash proceeds of GBP26.1 million post
period-end, as a result of further Trustpilot and UiPath share
sales.
The above figures contain alternative performance measures
("APMs") - see Note 23 for reconciliation of APMs to IFRS
measures.
Martin Davis, CEO at Molten Ventures, commented:
"We have achieved a huge amount over the last six months both
from a financial and operational point of view. We have been active
in investing, building on the increased investment cadence we
experienced in H2 FY2021, culminating in deployment being in excess
of what we initially anticipated for H1. This was due to an
acceleration of rounds for some of our existing companies, but also
through new investments, taking larger stakes and, crucially,
leading rounds.
Market conditions remained buoyant during the period. The shift
to online, accelerated by the pandemic, has remained a permanent
fixture of our daily lives largely due to advances in the
technology infrastructure, which was available during previous
investment cycles. While we cannot be certain about what the future
holds in the technology landscape, I am confident in venture
capital as an asset class and in our strategy, enhanced investment
platform, and diversified, resilient portfolio which spans climate
tech to health tech and fintech. We are sufficiently diversified to
counter volatility. We anticipate fair value growth in the region
of 35% for the full year to 31 March 2022, subject to wider market
conditions."
-S-
Enquiries:
Molten Ventures plc
Martin Davis (Chief Executive Officer)
Ben Wilkinson (Chief Financial Officer) +44 (0)20 7931 8800
Numis Securities
Joint Financial Adviser and Corporate
Broker
Simon Willis
Richard Thomas
Jamie Loughborough +44 (0)20 7260 1000
Goodbody Stockbrokers
Joint Financial Adviser and Corporate
Broker,
Euronext Dublin Sponsor
Don Harrington
Charlotte Craigie
Linda Clarke +44 (0) 20 3841 6202
Powerscourt
Public relations
Elly Williamson +44 (0)7970 246 725 /
Jane Glover +44 (0)7713 246 126
About Molten Ventures
Molten Ventures (LSE: GROW, Euronext Dublin: GRW) is one of the
most active venture capital firms in Europe, developing and
investing in disruptive, high growth technology companies. We
believe it is our role to support the visionary entrepreneurs who
will invent the future. We fuel their growth with our 'energy' in
the form of long-term capital, access to international networks and
decades of experience building businesses.
As at 30 September 2021, Molten Ventures is a shareholder in a
diverse portfolio of 70+ companies with 17 of those part of our
core portfolio which accounts for 68% of our holdings. Our core
companies include Trustpilot, Graphcore, Revolut, Ledger, and
Aiven. We invest across four sectors: Consumer Technology,
Enterprise Technology, Hardware and Deeptech, and Digital Health
and Wellness, with highly experienced partners constantly looking
for new opportunities in each. We look for high-growth companies
operating in new markets, with a serious potential for global
expansion, strong IP, powerful technology, and management teams to
deliver success. We also look for businesses with the potential to
generate strong margins to ensure rapid, sustainable growth in
substantial addressable markets.
Molten Ventures provides an opportunity for public market
investors to access these fast-growing tech businesses, without
having to commit to long term investments with limited liquidity.
Since turning public in June 2016, we have deployed over GBP700m
capital the portfolio and have realised over GBP380m to 30
September 2021.
For more information, go to https://www.moltenventures.com/
Chief Executive's review
Overview
Over the last six months we have achieved a huge amount. We have
been active in investing and in further strengthening our business
and the portfolio has performed exceptionally, supported by a
buoyant market driven, in part, by wholesale changes to the way we
live our lives.
Having raised another GBP107.7 million (net proceeds) in June
2021 to take advantage of the growing European venture capital
market and the post-pandemic secular shift towards technology and
digitalisation, we have set about deploying that capital. This
deployment followed on from the increased investment cadence we
experienced in H2 FY2021, and I am pleased to report that, driven
by the high-quality opportunities available, we have increased
deployment in excess of the amounts initially anticipated for the
full year. This is due to an acceleration of rounds for some of our
existing companies, but also through new investments, leading
rounds and taking larger stakes. Realisations have provided further
capital for deployment, and we continue with our strategy of
balancing increased deployment in a fast-paced market with a
strategic programme of realisations.
The expansion of our investment platform also played a key role
in the first half of this year. The Partnership team remains
tightly focused on new investments, active management of existing
portfolio companies and working with founders. Our recently
bolstered Platform team continues to make strides in supporting
deal flow, deal execution, and collaborating with the entrepreneur
community. This proven, scalable investment platform is adaptable
across investment cycles, through expanding the Fund of Funds
programme, creating additional deployment opportunities, different
sources of capital and/or additional fees.
During the period, we completed the move of our listing to the
Premium Segment of the Official List and to trading on the London
Stock Exchange's Main Market, as well as to the secondary listing
segment of the Official List of Euronext Dublin and to trading on
the regulated market of Euronext Dublin. The move was motivated by
the growth and maturity of the business, and we believe the Main
Market is the most appropriate platform for the Company's future
development. In line with this, we have further strengthened our
Board through the recent appointments of Sarah Gentleman and
Gervaise Slowey as Non-Executive Directors.
When reporting our final results in June, we set out a number of
priorities for the year ahead to further scale our AUM and further
develop our infrastructure, teams, and processes. These included
direct follow-on opportunities, an ability to participate in larger
rounds, a potential growth fund for growth stage (Series B+)
dealflow, the next Earlybird fund, Earlybird Fund VII, and our Fund
of Funds programmes. I am pleased to report continued strong
performance on all fronts.
In November 2021 (post period-end), we announced a name change
from Draper Esprit plc to Molten Ventures plc. The rebrand is in
response to the Company's transformation of recent years,
accelerated company growth and recent inclusion in the FTSE250, and
a recognition of its unique role in the democratisation of venture
capital. We also announced our new motto, "Make More Possible",
which reflects Molten's contribution as a listed venture capital
firm to identify and fully support the vision of Europe's most
successful companies and in doing so deliver value for our
shareholders.
Financial performance
We are delighted with our strong financial performance across
all our key measures: fair value growth; cash realisations;
investments made; and available capital resources.
During the period, we experienced increased costs related to the
one-off event associated with the Main Market move and the
investment into the strengthening of the team. These costs for the
period nevertheless remained within our target of less than one
percent of NAV.
Increased deployment
Capital deployed over the first six months of the year was
GBP165.0 million; as such we have already exceeded our stated
target of over GBP150m for FY2022 and the high quality
opportunities we have been able to take advantage of have led to an
increase from the GBP128.0 million deployed in FY2021. Quality has
remained a key focus for the Group, and it goes without saying that
we continue to be disciplined with respect to the quality and
number of the deals we choose to take part in. Key factors in our
increased deployment have been the ability to lead more deals and
back our portfolio companies that are scaling.
We have participated in new deals and follow-on rounds in
investment segments including climate tech, marketplaces, and cloud
native applications, sub-sectors we feel are poised for significant
growth, through companies such as Cervest, SimScale, Thought
Machine, and Form3.
Strong realisations
Our portfolio is balanced between more mature core portfolio
companies and the emerging portfolio that includes the core
companies of the future. Realisations, typically from more mature
companies, have started strongly in the first half of FY2022, with
GBP67.5 million already delivered. This allows us to reinvest
further in the portfolio as part of our evergreen model.
Additionally, two of our companies have gone public during the
period, UiPath and Cazoo, following Trustpilot's IPO at the end of
the prior year, creating further partial realisations during the
period.
Broader market environment
The broader market environment continues to be very strong. As
the year has progressed and the world has started to emerge from
the pandemic, albeit unevenly, there has been a significant upwards
gear shift in investment activity across the market. There is a
trend towards increasingly larger rounds as European technology
companies continue to mirror US investment trends.
The pandemic accelerated the shift to online and businesses were
forced to rethink old ways of operating and adopt new and
innovative approaches. The shape of the market today is also
different to what we have experienced in the past. Businesses can
now expand rapidly, with greater capital efficiency. This is
through a growing reliance on the cloud, as well as availability of
productivity apps and infrastructure tools such as payments
infrastructure and website creation/ hosting, meaning they can
operate from anywhere, anytime, with machine learning and AI
enabling this to happen more efficiently and cost effectively.
The overall trajectory of the European VC market is positive and
it is demonstrating signs of maturing; this comes with greater
international recognition and competition for the best deals. In
this environment, a flexible capital raising investment platform,
access to the best seed deals, a disciplined approach to investment
and the ability to continue to make follow-on deals represent the
optimal way to maximise potential returns.
Sustainability
We're pleased to report a continued focus on ESG during the
first six months of the year. Our activities in H1 included the
completion of unconscious bias training, launching our Board
Diversity & Inclusion policy, further strengthening of the
Board, roll-out of our blind recruitment policy, release of our UK
Corporate Governance Code statement, and the start of our annual
carbon emissions data collection and balancing project, which will
feed into our Streamlined Energy and Carbon Reporting ("SECR") for
the coming year-end. We have also kicked off our Task Force on
Climate-Related Financial Disclosures ("TCFD") project. We are not
required to report on TCFD as a Chapter 15 Company, but we are
doing so voluntarily.
As a reminder, all prospective portfolio companies in which we
consider making a direct investment are initially screened against
our Exclusion List and thereafter assessed as part of our ESG due
diligence process before a final decision is taken on the
investment.
We continue to progress our ESG roadmap and look forward to
providing further updates in due course.
Outlook
Clearly the pandemic is not behind us yet, however a pattern is
emerging that helps us envisage how life may operate in a post
pandemic world. With this in mind, I would like to take this
opportunity to look forward and reflect on the various
opportunities ahead. We have refreshed our Fund of Funds programme
with an additional GBP75.0 million investment budget to be deployed
over five years which gives us extra flexibility to identify
potential dealflow opportunities from within seed stage
portfolios.
Our exploration of a potential growth fund continues to progress
and will be a continued focus for the next six months of the year.
This is intended for growth stages aimed at Series B+ dealflow
using third-party funds alongside our own to provide a greater
ability to lead deals and secure influence and allocation.
As we see the impact on the technology sector of the fundamental
shift in our way of living and working as a result of the
accelerated transition to digital, I feel greatly encouraged by the
strength of our position in the market. I am confident that Molten
Ventures is well positioned to continue to support the most
promising companies and to continue to drive value for our
shareholders and "Make More Possible". We continue to see growth
within our portfolio through revenue increases, financing rounds
and exits, combined with a healthy pipeline of new investment
opportunities. As a result, portfolio growth is already well ahead
of our stated financial objective of 15% Gross Portfolio fair value
growth for this financial year, and our portfolio continues to
perform strongly. We therefore anticipate fair value growth in the
region of 35% for the full year to 31 March 2022, subject to wider
market conditions.
Portfolio review
In FY2022, our strategy of balancing increased deployment in a
fast-paced market with considered realisations continues.
During the first half of the financial year, Molten Ventures
(formerly Draper Esprit) deployed capital in the increasing growth
opportunities in the European venture capital market, including in
segments such as climate tech, marketplaces, and cloud native
applications - all areas which have benefited from the accelerated
transition to digital we continue to see, resulting from the events
of the last few years. We continue to be disciplined regarding the
quality of our investment process, with our increased capital base
giving us the opportunity to lead more rounds, as well as continue
to support our portfolio companies as they scale in larger later
rounds. The Company invested GBP165.0 million in the first six
months of the financial year, exceeding our target for the year of
over GBP150.0 million, following the acceleration of rounds for
some existing companies, but also opportunities to invest in new
companies, leading rounds and taking larger stakes.
Cash proceeds from realisations during the first half of the
year of GBP67.5 million included proceeds from the exits from
SportPursuit, Conversocial and PremFina, selling down some of our
shares held in publicly listed Trustpilot and UiPath, as well as
escrow receipts relating to previously announced disposals.
Our resilient portfolio continues to be a balance of mature core
portfolio companies and our emerging portfolio, which includes the
core companies of the future.
Portfolio valuations
The Gross Portfolio Value as at 30 September 2021 is GBP1,350.2
million, an uplift of GBP366.4 million to the 31 March 2021 value
of GBP983.8 million. Of this 37% uplift, GBP12.6 million results
from FX impact on the portfolio. The largest drivers of the fair
value increase are Revolut, Trustpilot, Form3, and Ledger.
Our portfolio valuations are set against the backdrop of a
strong recovery from the COVID-19 pandemic, especially in the
technology sector as businesses embrace "digital transformation"
and where equity markets are trading at close to their all-time
highs and with a record number of companies achieving "unicorn"
status.
At the end of FY2021, Trustpilot, one of our core companies,
successfully IPO'd at GBP2.65 per share. During the first half of
FY2022, UiPath (April 2021 IPO at US$56.00 per share) and Cazoo
(August 2021 via a SPAC merger) also became quoted investments
within our portfolio. Their valuations are based on their quoted
share price at 30 September 2021.
The Core Portfolio is made up of 17 companies representing 68%
of the Gross Portfolio Value. New entrants to the core are
CoachHub, Form3, ISAR Aerospace, and N26, whilst Perkbox, Freetrade
and Endomag are not above the threshold for the core in this period
and we exited SportPursuit.
New companies
During the period, we invested GBP49.9 million into new entrants
to the portfolio, taking advantage of opportunities to lead rounds
in areas such as climate tech, fintech and the future of
deliveries, whilst maintaining the quality and volume of
investments made.
- FintechOS - we led a US$60.0 million Series B funding round in
FintechOS, supported by existing investors, including Earlybird
Digital East. FintechOS is a global technology provider for banks,
insurers and other financial services companies, whose low-code
approach to digital transformation has seen rapid adoption in
Europe. It allows institutions to build, test and scale new digital
products and services in weeks rather than months.
- SimScale - we co-led a EUR25.0 million Series C extension
round in SimScale during the period. SimScale is a SaaS platform,
making high-fidelity simulation technically and economically
accessible to engineers worldwide. SimScale's software is the
world's first simulation software platform that is hosted on the
cloud and it allows engineers to simulate and analyse the physical
behaviour of their products with a standard web browser.
- Aktiia - we led a US$17.5 million Series A round in Aktiia
during the period. Aktiia has built a system for continuous blood
pressure monitoring for remote patient monitoring in hypertension.
Aktiia's core product is a CE-marked, non-invasive optical blood
pressure monitoring device worn on the wrist that was launched in
the UK and three European countries in 2021.
- Cervest - we led a US$30.0 million Series A round in Cervest
during the period. Cervest is the creator of the world's first AI
Climate Intelligence platform. The platform combines public and
private data sources, machine learning and cutting-edge statistical
science to present a unified view of climate risk that has been
previously impossible. Its EarthScan(TM) product gives enterprises
and governments on-demand access to current, historical and
predictive views of how combined risks, such as flooding, droughts
and extreme temperatures can impact the assets they own or
manage.
- Manna - we led a US$25.0 million Series A round in Manna.
Manna designs, builds and operates unmanned aerial vehicles which
perform high-speed deliveries of takeaway food, groceries and
pharmacy goods/supplies up to 3kgs in suburban last-mile settings.
It is the most commercially progressed company of its kind in the
world, currently trialling its service in Galway, Ireland and
Balbriggan, Dublin.
- Allplants - we led a GBP38.0 million Series B funding round in
Allplants, the D2C plant-based food business. Its plant-based meals
are handmade, 24 hours a day, by 140 chefs in the company's own
kitchen and delivered across Great Britain.
- Schüttflix - we invested as part of their US$50.0 million
Series A round into Schüttflix, a platform that connects material
producers and freight forwarders with customers from different
construction sectors, such as building, civil engineering, and
landscaping. The invested amount in the period is a small part of
our investment, with the larger balance to follow post
period-end.
The final close of PrimaryBid's Series B, which we called out in
our Annual Report for the year ending 31 March 2021, also forms
part of the GBP49.9 million invested into new companies in the
period.
New companies - co-investment strategy
As an extension of our existing strategy of deploying capital
via other vehicles through our Fund of Funds programme,
co-investments with some of our seed fund managers have enabled us
to invest GBP17.6 million into three new additions to the portfolio
during the period.
By leveraging our network of experts, we have been able to
access exciting opportunities in forward-thinking European
companies in the gaming, sustainable food supply, and business
forecasting sectors.
Follow-on
We continue to support our existing portfolio as they grow, with
our increased investment cadence allowing us to invest GBP76.9
million into follow-ons, including:
- Form3 - we participated with a further GBP25.0 million in a
US$160.0 million Series C round in platform payment technology
provider, Form3. The round was led by new investor, Goldman Sachs,
and also included existing investors Lloyds Banking Group,
Nationwide Building Society, Barclays, Mastercard and 83North.
Founded In 2016, Form3 is the leading platform payment technology
provider and offers an alternative to the traditional payment
infrastructure model, providing an always-on, cloud-native,
Payments-as-a-Service platform. Form3 is trusted by some of the UK
and Europe's biggest Tier 1 banks and fastest-growing fintechs to
handle their critical payments architecture.
- Thought Machine - we participated with a further GBP15.4
million into the latest round in the cloud native core banking
technology company, Thought Machine. Thought Machine was founded in
2014 with a mission to enable banks to deploy modern systems and
move away from the legacy IT platforms of the banking industry.
Their customers include Lloyds Banking Group, JPMorgan Chase,
Standard Chartered, SEB, Atom bank, and Curve, among others.
- CoachHub - we participated with a further GBP14.7 million
investment in a US$80.0 million Series B extension round in
CoachHub, supported by existing investors RTP Global, HV Capital,
Signals Venture Capital, Partech and Speedinvest. CoachHub is the
leading global talent development platform and enables
organisations to create a personalised, measurable, and scalable
coaching program for the entire workforce, regardless of department
and seniority level. CoachHub uses artificial intelligence to match
individuals with more than 2,500 certified business and well-being
coaches in 70 countries across six continents, with coaching
sessions available in more than 60 languages.
- Ledger - we invested GBP10.0 million in a US$380.0 million
Series C round in Ledger. We first invested in Ledger in 2018, as
part of its US$75.0 million Series B. Ledger allows investors to
access the world of digital assets securely. The latest fundraising
will allow the company to further innovate its hardware products,
adding new transactional services to Ledger Live such as
Decentralised Finance solutions, and significantly expand its
enterprise capabilities. It will also use the fundraise to invest
in its proprietary Operating System, which runs across all of
Ledger's products and services, so that it can support the seamless
integration of new third-party services.
- Lyst - we participated in a US$85.0 million funding round in
Lyst, joined by new investors Fidelity International, Novator
Capital, Giano Capital and C4 Ventures. Lyst is the largest global
fashion search platform that lets users search thousands of online
fashion stores at once, bringing together 5 million products from
12,000 of the world's leading brands and retailers.
- Aircall - we participated in a US$120.0 million Series D round
with an investment of GBP3.6 million in Aircall. Aircall has now
raised over US$226.0 million, with Molten Ventures first investing
in their Series B round in 2018. Aircall is an entirely cloud-based
voice platform which integrates seamlessly with popular
productivity and helpdesk tools.
Fund of funds
Our seed Fund of Funds programme continues to expand, providing
access to earlier stage companies, as well as dealflow
opportunities for the highest quality companies from within these
portfolios. During the period, we committed to another 12 funds,
bringing our total commitments to 47 funds. Total commitments to
new and existing seed funds at 30 September 2021 are GBP89.6
million, of which GBP38.8 million has been drawn to period-end
(GBP13.3 million during the period). It is anticipated the
remaining GBP50.8 million will be drawn over the next 3-5
years.
Amongst the new funds within our portfolio are:
- Atlantic Food Labs - we have committed EUR4.0 million to this
Berlin based fund, which focuses on sustainability, nutrition and
health.
- Form Ventures - we have committed GBP1.8 million to this
British fund, which focuses on UK start-ups with public policy
exposure.
- Forward Partners - we have committed GBP2.0 million to this
listed London based fund, which focuses on ecommerce and applied
AI.
We have also shown support to some of our existing managers by
committing to their new funds, such as ByFounders II, Join Capital
II, and IQ Capital IV A in the current period.
Earlybird
During this period, we invested GBP7.3 million via our
partnership with Earlybird into their Digital East Fund I, Growth
Opportunities Fund, and Earlybird West's Fund VI and VII,
continuing to access earlier stage companies in Germany and Europe
with the benefit of Earlybird's expertise.
Realisations
Cash proceeds of GBP67.5 million were received during the period
to 30 September 2021, relating to the full exits from SportPursuit,
PremFina, and Conversocial, as well as partial exits relating to
Trustpilot and UiPath (now both publicly listed), and distributions
of escrows relating to exits in prior periods.
- SportPursuit -we exited our investment in the leading online
private sales club in the UK and Germany, SportPursuit, as a
consequence of an investment by private equity firm, bd-capital. We
realised a total cash return of GBP22.8 million (including
estimated escrow not yet received), above the GBP18.5 million fair
value held at 31 March 2021. The Company first invested in
SportPursuit in 2012 as part of a Series A round, providing the
first institutional investment and has supported the company in
each subsequent fund raising
- Trustpilot - during the prior financial year, as part of
Trustpilot's IPO in March 2021, Molten Ventures sold down part of
its holding in the leading global review platform, generating
proceeds during FY2021 of GBP75.5 million. At 30 September 2021, we
held 31.1 million shares in Trustpilot PLC, having generated
further proceeds of GBP2.5 million during the period. Post
period-end, we sold further shares generating proceeds of GBP20.8
million. Since IPO, we have so far generated cash proceeds of
GBP98.8 million.
- UiPath - UiPath listed on the New York Stock Exchange in April
2021. We have generated proceeds of GBP35.8 million during the
period from related distributions from Earlybird Digital East and
sale of shares and are recognising the remaining holding at 30
September 2021 at the period-end share price.
Post period-end
Post period-end, we have deployed GBP36.6 million in investments
including an investment in Satellite Vu, a British start-up using
satellite technology to determine valuable insights into economic
activity, energy efficiency and carbon footprint.
We have realised cash proceeds of GBP26.1 million post
period-end, as a result of further Trustpilot and UiPath share
sales.
Core Portfolio updates
The Molten Ventures (formerly Draper Esprit) Core Portfolio is
made up of 17 companies representing 68% of the Gross Portfolio
Value. New entrants to the core are CoachHub, Form3, ISAR
Aerospace, and N26, whilst Perkbox, Freetrade and Endomag are not
above the threshold for the core in this period and we exited
SportPursuit.
Trustpilot
Consumer technology - Copenhagen
Invested Fair value
(GBP'm) (GBP'm)
15.1 119.7
-----------
Online global review platform, Trustpilot, provides a trust
layer for the open commerce ecosystem by giving consumers the
confidence to purchase goods and services from a wide range of
online and offline businesses across the world. Trustpilot is
listed on the London Stock Exchange with the ticker TRST.
-- In March 2021, Trustpilot floated on the London Stock
Exchange under the ticker TRST, its stock opened at GBP2.65 per
share
-- Joe Hurd was appointed to the board as a non-executive director
-- Former Marketing Director of QuickBooks, Alicia Skubick was
appointed Chief Marketing Officer (effective 4 October 2021)
-- Launched integrations with Shopify, WooCommerce marketplace and PrestaShop
Graphcore
Hardware & Deeptech - Bristol
Invested Fair value
(GBP'm) (GBP'm)
24.0 110.7
-----------
Graphcore is a machine intelligence semi-conductor company,
which develops Intelligent Processing Units ("IPUs") that enable
unprecedented levels of AI compute. The IPUs' unique architecture
enables AI researchers to undertake entirely new types of work,
which drives advances in machine intelligence.
-- In December 2020, Graphcore raised US$222.0 million in a
Series E funding round led by Ontario Teachers' Pensions Plan
Board. Also participating in the round were Molten Ventures, funds
managed by Fidelity International and Schroders, and Baillie
Gifford
-- The company continues to roll out partnerships and product
integrations, such as Pytorch lightning and ATOS
-- With new offices in Germany and Singapore and existing
offices in Bristol, London, Cambridge, Palo Alto, Oslo, Beijing,
Hsinchu, Seoul, New York, Seattle, and Austin, the global company
continues to scale in size, increasing to 550+ employees from its
previously reported 200+ employees
-- Graphcore participated in research with University of
Massachusetts Amherst and Facebook to publish a paper demonstrating
that COVID-19 analysis using Approximate Bayesian Computation can
be massively accelerated with IPU processors
Revolut
Consumer technology - London
Invested Fair value
(GBP'm) (GBP'm)
7.4 89.7
-----------
Revolut is a global financial services company that specializes
in mobile banking, card payments, money remittance, and foreign
exchange. Revolut is developing into a fintech super-app.
-- Revolut appointed a number of new hires including; Paroma
Chatterjee as CEO India to build and lead Revolut's subsidiary in
India, Mikko Salovaara as Group CFO, Sid Jajodia, as Chief Banking
Officer, and Joe Heneghan steps up to a new role as Chief Executive
Officer, Europe
-- In July 2021, Revolut raised US$800.0 million Series E
funding from SoftBank's Vision Fund 2 and Tiger Global, valuing the
business at US$33.0 billion
-- The funding will be used to continue to build the first global financial super-app
-- Launched Payday, to help employees access wages early to
improve their financial wellbeing
Ledger
Hardware & Deeptech - Paris
Invested Fair value
(GBP'm) (GBP'm)
27.7 70.3
-----------
Ledger's products use hardware wallets, server appliances, and
embedded technology based on a low-footprint crypto-embedded
operating system built for secure elements and orchestration of
code and systems, enabling financial institutions to get
cybersecurity services for digital assets.
-- Former Apple Music exec, Parker Todd Brooks, joined the
company as head of NFT division
-- Hired Iqbal V. Gandham, who has been involved with crypto
since 2016, as VP of Payments and Transactions, and Charles Hamel,
founder of Crypto UK as VP of Product. The two join Ledger from
eToro and Opera respectively
-- In June 2021 Ledger raised US$380.0 million, with Molten
Ventures as lead investor, in their Series C round. The Series C
round will enable the company to further innovate its hardware
products adding new transactional services to Ledger Live, such as
Decentralised Finance solutions, and significantly expanding its
enterprise capabilities, as well as invest in its proprietary
Operating System to allow seamless integration of new third-party
services.
-- The company launched a new update of its Nano S Firmware
Version 2.0.0 and announced its integration with Wyre
Aiven
Hardware & Deeptech - Helsinki
Invested Fair value
(GBP'm) (GBP'm)
5.0 60.7
-----------
Aiven democratises access to the latest open-source technologies
by offering fully-managed services for popular open-source projects
like Apache Kafka and Cassandra, Elasticsearch, M3 and PostgreSQL
in the public cloud.
-- Aiven's most recent Series C funding round closed in March
2021, raising US$100.0 million. As well as Earlybird, investors
include Atomico, IVP (Institutional Venture Partners), World
Innovation Lab, and Salesforce Ventures.
-- Since 2017, the company has grown to include 140 employees
-- Aiven has released Aiven for OpenSearch and now Kubernetes
Operator support for PostgreSQL and Apache Kafka
This investment is held via Earlybird.
Form3
Enterprise technology - London
Invested Fair value
(GBP'm) (GBP'm)
30.1 59.2
-----------
Form3 provides a cloud-native, real-time payment technology
platform to enable banks and regulated fintechs to create amazing
products and experiences.
-- Form3 announced US$160.0 million Series C funding round led
by Goldman Sachs Asset Management. Molten Ventures, alongside other
existing investors, also participated
-- Form3 made several new hires to its Executive Leadership
team, including; Giles Hawkins as Chief Legal Officer, Simeon Lando
as Chief Marketing Officer, and Jessica Letterman as Chief Customer
Officer
-- Form3 expects to continue to grow in people terms by around
60% in the next 12 months having seen annual recurring revenue in
2021 grow by 233%. Form3 already employs over 260 people in 22
countries
-- Nationwide has partnered with Form3 to use their platform to
help deliver the Building Society's future payments strategy
UiPath
Hardware & Deeptech - New York
Invested Fair value
(GBP'm) (GBP'm)
6.6 55.8
-----------
UiPath provides a comprehensive robotic software solution for
IT-based process automation. Built on a comprehensive, fully
integrated platform with centralised instrumentality, UiPath is
designed for the highest standards of enterprise management,
security, scalability and auditability.
-- UiPath listed on 21 April 2021 on the New York Stock Exchange under the ticker PATH
-- The company strengthened their leadership team with two new
hires; former ServiceMax executive, Bettina Koblick, was appointed
new Chief People Officer and Andreea Baciu was appointed the
company's first Chief Culture Officer
-- Five UiPath executives were named in CRN's 2021 Women of the
Channel List for their leadership, dedication and channel advocacy
including; Cherlyn Chin (Vice President, Global Partners &
Alliances), Janette Hausler (Vice President, Americas Marketing and
Global Partner Marketing), Gena Phelps (Director, Americas Partner
& Regional Marketing), Jessie Zhang (Global Partner Sales
Director, Greater China), and Stacey Black (Director, Global
Partner Programs & Operations)
-- In September, UiPath announced second quarter results with
ARR of US$726.0 million, growing 60% year on year
This investment is held via Earlybird.
Lyst
Consumer technology - London
Invested Fair value
(GBP'm) (GBP'm)
13.2 50.3
-----------
A search engine just for fashion. Lyst offers a social shopping
site that includes an inventory of fashion products and provides
access to changing fashion data points every hour, enabling users
to find and buy the latest fashion trends by browsing through a
series of clothing and accessories.
-- Lyst raised a US$85.0 million funding round. Molten Ventures
participated alongside several existing investors and were joined
by new investors, Fidelity International, Novator Capital, Giano
Capital and C4 Ventures
-- GMV last year exceeded US$500.0 million, following 1100%
growth in new users on the Lyst app. Lifetime GMV is now over
US$2.0 billion
-- The company announced a few appointments in senior management
positions; Mateo Rando, previously at Spotify, as Chief Product
Officer and Emma McFerran, formerly General Counsel and Chief
People Officer, has been appointed COO and a new board member
-- Lyst also released its own Conscious Fashion Report, a
deep-dive into fashion lovers' changing sustainable habits and the
creators driving that change from the company's insights and data
analysis
Aircall
Enterprise technology - Paris
Invested Fair value
(GBP'm) (GBP'm)
14.3 49.3
-----------
The company's cloud-based platform integrates seamlessly with
popular productivity and helpdesk tools and is accessible,
transparent, and collaborative. It replaces outdated systems with a
collaborative platform that helps to communicate with customers,
prospects, candidates, and colleagues. This enables businesses to
be better on customer support or sales engagement with a phone
system.
-- Aircall raised a US$120.0 million Series D funding round.
Goldman Sachs joined the round as the newest investor. Molten
Ventures also participated alongside eFounders, NextWorld Capital,
Adams Street Partners, DTCP, Swisscom Ventures, and Gaia Capital
Partners
-- The capital will be used to enrich Aircall's app ecosystem
with new integrations across use cases, expand further globally
with new European offices in London and Berlin and deeper
investments in North America and APAC. It is also looking to
partner with major telecommunications companies to bring its
technology to a wider audience, as well as enhancing its technology
with new AI capabilities and additional productivity features for
call centres such as transcription and speech analytics
-- The company opened its Sydney office at the beginning of the
year and has grown its team from 1 to 30, and reached the milestone
of 1,000 customers
-- Aircall continues to have a number of partnerships and
integrations with platforms like HubSpot, CRM and Paytia
Thought Machine
Enterprise technology - London
Invested Fair value
(GBP'm) (GBP'm)
31.9 44.9
-----------
Cloud native core banking technology company, Thought Machine
provides core banking infrastructure to both incumbent and
challenger banks. The company's technology provides an alternative
more flexible cloud-based solution that can be configured to
provide any product, user experience, operating model, or data
analysis capability.
-- Thought Machine's creative arm, Cauldron launched as a
standalone financial video game studio
-- JP Morgan selected Thought Machine to overhaul its core
banking systems across the bank's entire US retail network, Chase
Bank
RavenPack
Enterprise technology - Marbella
Invested Fair value
(GBP'm) (GBP'm)
7.5 34.9
-----------
RavenPack, leading big data analytics provider for financial
services, allows clients to enhance returns, reduce risk and
increase efficiency by systematically incorporating the effects of
public information on their models or workflows.
-- Launched RavenPack Edge, a new AI platform that collects,
reads, and analyses billions of documents to help businesses better
monitor and mitigate emerging risks. RavenPack Edge is capable of
understanding content in 13 different languages, Edge can extract
insights from all types of documents -from short news articles to
complex legal filings
-- Launched the Credit Suisse RavenPack Artificial Intelligence
Index, a rules-based multi-asset index applying a S&P 500(R)
sector rotation process driven by news sentiment. This powers
systematic investment strategies designed to provide exposure to
sectors of the U.S. economy with stronger sentiment based on a news
analytics algorithm powered by RavenPack
CoachHub
Enterprise technology - Berlin
Invested Fair value
(GBP'm) (GBP'm)
27.1 33.0
-----------
CoachHub is a leading global talent development platform that
enables organisations to create a personalised, measurable, and
scalable coaching program for the entire workforce, regardless of
department and seniority level. By doing so, organisations are able
to reap a multitude of benefits, including increased employee
engagement, higher levels of productivity, improved job
performance, and increased retention.
-- CoachHub raised US$80.0 million Series B2 funding, increasing
total funding to US$110.0 million. Molten Ventures, RTP Global, HV
Capital, Signals Venture Capital, Partech, and Speedinvest all
participated in the round
-- Professor Jonathan Passmore was appointed as Senior Vice President of Coaching
-- CoachHub acquired French market leader and a pioneer in digital coaching, MoovOne
-- The company launched CoachHub Wellbeing, its new mental
health coaching programme designed to improve employee wellbeing
across the global workforce
Cazoo
Consumer technology - London
Invested Fair value
(GBP'm) (GBP'm)
10.0 32.8
-----------
Cazoo is the UK's fastest-growing digital business and leading
online car retailer, which makes buying a car much like buying any
other product online today by providing better selection, value,
convenience, and quality. Founded in 2018 by serial entrepreneur,
Alex Chesterman OBE.
-- In August 2021, Cazoo began trading on New York Stock
Exchange under the ticker "CZOO"
-- In the company's first 18 months it delivered over 25,000 cars
-- Cazoo acquired automotive data insights platform, Cazana, and SMH Fleet Solutions
-- Several new members joined the Board including; Duncan
Tatton-Brown, Anne Wojcicki, Moni Mannings, and Luciana Berger
-- Several hiring decisions were made including; the appointment
of Veronica Sharma as Group Chief People Officer and Abhishek Roy
as European Managing Director. Jonathan Dunkley also joined as
Senior Strategic Adviser
M-Files
Enterprise technology - Tampere
Invested Fair value
(GBP'm) (GBP'm)
6.5 29.3
-----------
Intelligent information management platform, M-Files, organises
customers' content with the ability to connect to existing network
folders and systems and to enhance them with the help of AI to
categorise and protect information.
-- Karthik Shankar appointed as ANZ channel sales engineer
-- M-Files acquired Hubshare, a collaborative and secure file
sharing platform, for an undisclosed amount in April 2021
-- The company received the highest score in two use cases in
updated Gartner(R) Critical Capabilities for Content Services
Platforms report
N26
Consumer technology - Berlin
Invested Fair value
(GBP'm) (GBP'm)
10.6 25.3
-----------
N26 provides mobile banking services for customers. Its mobile
banking services offer online banking that includes making and
handling of current accounts, fixed accounts, and other banking
services, letting customers manage and control their banking
details via a smartphone application easily.
-- Raised US$900+ million Series E Round led by Third Point
Ventures and Coatue Management, and joined by Dragoneer Investment
Group as well as existing N26 investors
-- Launched on-demand insurance product N26 insurance, which
will offer the digital bank's customers the option from the N26 app
to purchase coverage, manage plans and initiate claims for a range
of insurance plans from different providers. The offering is
currently available in Europe
-- Expanded its management team with the appointment of Thomas
Grosse taking on the role of Chief Risk Officer (CRO), Dr. Stephan
Niermann, as Group Money Laundering Reporting Officer (MLRO), and
Dr. Volker Vonhoff as Director of Group Risk. Alongside the
appointment of Dr. Jan Kemper as Chief Financial Officer (CFO) of
the Group, Christian Strobl was also appointed as Austrian Market
lead
-- N26 announced a partnership with SumUp, lowering barriers for
cashless payment acceptance for freelancers and self employed
This investment is held via Earlybird.
Isar Aerospace
Hardware & Deeptech - Munich
Invested Fair value
(GBP'm) (GBP'm)
4.5 25.1
-----------
Isar Aerospace develops and builds launch vehicles for
transporting small and medium-sized satellites as well as satellite
constellations into Earth's orbit.
-- Isar Aerospace extended its Series B funding round to over
US$165.0 million led by HV Capital, Porsche SE, and Lombard Odier.
Other participants include existing investors Earlybird, Lakestar,
Vsquared Ventures, and Apeiron
-- The company has signed an agreement with Norwegian Andøya
Space to secure exclusive access for a period of up to twenty years
to one of its launch pads on the island Andøya. As a launch site
operator, Andøya Space provides launch pads, payload integration
facilities as well as the technical infrastructure on site
-- Airbus Defence and Space has committed to use Isar Aerospace
for satellite launch services
-- Partnership with OroraTech to launch satellites for tackling global wildfire crises
This investment is held via Earlybird.
Smava
Enterprise Technology - Berlin
Invested Fair value
(GBP'm) (GBP'm)
14.5 24.1
-----------
Online loan comparison platform, Smava, brings private
applicants together with a variety of banks and private investors,
offering highly attractive interest rates for loans, providing
customers a tailored online loan with the best conditions free of
charge within seconds.
-- Announced partnerships with Deutsche Bank and Younited Credit
-- In February, Smava acquired Finanzcheck and became leading
platform specialist in consumer loans in Germany
This investment is held via Earlybird.
Interim financial review
The six-month period ended 30 September 2021 has included an
equity raise of GBP107.7 million (net of costs) from new and
existing investors, as well as strong returns on exits (cash
proceeds of GBP67.5 million), providing more financial capacity to
take advantage of the opportunities we are seeing in the market,
which in turn has led to an accelerated rate of deployment.
The Company moved to the Main Market in July 2021, which
alongside the raise (including a PrimaryBid element), has created a
more diverse investor base.
The Gross Portfolio Value of GBP1,350.2 million (GBP983.8
million at 31 March 2021) is subject to deductions for the fair
value of the Carry Liabilities and Irish deferred tax to generate
the net investment value of GBP1,229.5 million as at 30 September
2021, which is recognised in the condensed consolidated interim
statement of financial position. The percentage of Net Portfolio
Value to Gross Portfolio Value is 91% as at 30 September 2021 (31
March 2021: 88%), which is stable on prior year, but reflecting an
increased proportion of the portfolio subject to carried interest
at 15% compared to periods prior to the year ending 31 March 2021.
The Net Portfolio Value has increased to GBP1,229.5 million as at
30 September 2021 from GBP867.1 million at 31 March 2021. This
results from investments made of GBP165.0 million and a net fair
value increase of GBP252.0 million (including GBP12.6 million of FX
impact), offset by realisations of GBP67.5 million.
The net fair value gain on investments of GBP252.0 million is
reflected in the condensed consolidated interim statement of
comprehensive income. The deferred tax recognised on the Gross
Portfolio Value has decreased in the period and a deferred tax
liability has been recognised in the condensed consolidated interim
statement of financial position. This is to more closely align the
recognition of deferred tax to the location in which it will likely
become payable on realisation of the assets. Carry balances of
GBP121.2 million are accrued to previous and current employees of
the Group based on the current fair value at the period-end and
deducted from the Gross Portfolio Value. The Gross Portfolio Value
table in the Portfolio Review has been generated to reconcile the
gross to net portfolio values and the movements between 31 March
2021 to 30 September 2021.
Total available liquidity for the Group at 30 September 2021 was
GBP221.2 million, including GBP65.0 million undrawn on the
Company's revolving credit facility (31 March 2021: GBP220.7
million, including GBP60.0 million undrawn on the Company's
revolving credit facility). The cash balance at 30 September 2021
of GBP156.2 million is a decrease of GBP4.5 million from the
balance at 31 March 2021. During the period, our fundraise
generated net proceeds of GBP107.7 million and we received cash
proceeds of GBP67.5 million. This was offset by investments made
during the period of GBP165.0 million, as well as operating
costs.
The Company's revolving credit facility was extended and
increased by one year to GBP65.0 million (from GBP60.0 million) in
May 2021. We have been in compliance with all covenants throughout
the duration of the facility and at the period end. The facility
was undrawn as at 30 September 2021; therefore, no borrowing
liability is recognised in the consolidated statement of financial
position. The balance recognised under borrowings of GBP0.5 million
relates to capitalised fees from the setup and extension of the
facility, which are being amortised over its life.
We have seen an increase in the net asset position as at 30
September 2021 of 31% to GBP1,357.4 million. This is mainly the
result of the increase in investments discussed above, offset by
the small decrease in cash and an increase in deferred income
relating to management fees paid in advance.
Income recognised during the period ending 30 September 2021
comprises investment gains of GBP252.0 million (period ending 30
September 2020: GBP56.4 million), as well as fee income of GBP10.0
million (period ending 30 September 2020: GBP6.0 million), which is
generated from management and directors' fees, including from our
EIS and VCT funds. Increase in fee income is a result of
consolidation of the manager of our VCT funds, as well as
reflective of the growth in the portfolio within our internal
management fees. General and administration costs of GBP11.2
million, compared to the GBP6.6 million recognised in the six
months to 30 September 2020, have mainly increased due to growth in
team and infrastructure as the Group evolves. Our operating costs
(net of fee income) continue to be less than our target of 1% of
NAV. Exceptional costs of GBP2.4 million were recognised in the
period relating to the Company's move to the Main Market. This
includes all non-recurring costs relating to the Main Market move,
such as legal, reporting accountant, exchange, and broker fees.
All related party transactions that took place in the six months
ending 30 September 2021 are consistent in nature with the
disclosures in Note 30 of the Annual Report and Accounts for the
year ended 31 March 2021. Related party transactions which took
place in the period and materially affected performance or the
financial position of the Group, together with any material changes
in related party transactions as described in the Annual Report and
Accounts for the year ended 31 March 2021 that could materially
affect the performance or financial position of the Group are
detailed in Note 20.
Post period-end:
- Deployment of GBP36.6 million, including in Satellite Vu
- Cash proceeds of GBP26.1 million received post period-end, as
a result of further Trustpilot and UiPath share sales
Gross Portfolio Value Table
Fair Fair Fair Interest
Value Molten Movement Value Value FD
of Ventures in Movement of of category*
Investments (Ireland) Foreign in Fair movement Investments at
31-Mar-21 Investments Realisations Limited^ Exchange Value 30-Sep-21 30-Sep-21 reporting
Investments GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm date
------------ ----------- ----------- ------------ --------- -------- -------- --------- -----------
Trustpilot 85.5 - (2.5) - - 36.7 36.7 119.7 B
Graphcore 108.8 - - - 2.4 (0.5) 1.9 110.7 A
Revolut 20.4 - - - 0.5 68.8 69.3 89.7 A
Ledger 41.8 10.0 - - 0.4 18.1 18.5 70.3 B
Aiven 45.5 - - - 0.8 14.4 15.2 60.7 B
Form3 10.2 25.0 - - - 24.0 24.0 59.2 C
Ui Path 100.3 - (35.8) - 1.7 (10.4) (8.7) 55.8 A
Lyst 35.1 7.2 - - 1.0 7.0 8.0 50.3 C
Aircall 32.8 3.6 - - 0.9 12.0 12.9 49.3 B
Thought
Machine 18.4 15.4 - - - 11.1 11.1 44.9 B
Ravenpack 29.9 - - - 0.7 4.3 5.0 34.9 D
CoachHub 12.4 14.7 - - 0.3 5.6 5.9 33.0 D
Cazoo 25.7 - (0.1) - - 7.2 7.2 32.8 A
M-Files 29.7 - - - 0.3 (0.7) (0.4) 29.3 B
N26 10.0 - - - 0.1 15.2 15.3 25.3 A
Isar
Aerospace 14.8 - - - - 10.3 10.3 25.1 B
Smava 23.8 - - - 0.3 - 0.3 24.1 A
Remaining
Portfolio 336.1 89.1 (29.1) - 3.2 33.4 36.6 432.7
------------ ----------- ----------- ------------ --------- -------- -------- --------- -----------
Total 981.2 165.0 (67.5) - 12.6 256.5 269.1 1,347.8
------------ ----------- ----------- ------------ --------- -------- -------- --------- -----------
Co-Invest 2.6 - - - - (0.2) (0.2) 2.4
------------ ----------- ----------- ------------ --------- -------- -------- --------- -----------
Gross
Portfolio
Value 983.8 165.0 (67.5) - 12.6 256.3 268.9 1,350.2
------------ ----------- ----------- ------------ --------- -------- -------- --------- -----------
Carry
External (97.0) - - - - (24.2) (24.2) (121.2)
Portfolio
Deferred
tax (20.0) - - - - 20.2 20.2 0.2
Trading
carry
& co-invest 0.3 - - - - - - 0.3
MV Ireland
Limited - - - 12.9 - (12.9) (12.9) -
------------ ----------- ----------- ------------ --------- -------- -------- --------- -----------
Net
Portfolio
value 867.1 165.0 (67.5) 12.9 12.6 239.4 252.0 1,229.5
------------ ----------- ----------- ------------ --------- -------- -------- --------- -----------
^Formerly Draper Esprit (Ireland) Limited. Name change occurred
on 11 November 2021.
* Fully diluted interest categorised as follows: Cat A: 0-5%,
Cat B: 6-10%, Cat C: 11-15%, Cat D: 16-25%, Cat E: >25%
Principal risks and uncertainties
A detailed explanation of the principal risks and uncertainties
faced by the Group, the steps taken to mitigate these risks, and
the governance process around risk management is set out in the
Risk Management and Principal Risks sections of the Annual Report
and Accounts for the year ending 31 March 2021. There have not been
any material changes to the principal risks faced by the Group (or
their impact and likelihood) as reported at the 31 March 2021.
Please find a summary of the principal risks and uncertainties for
the remaining six months of the financial year below.
Risk Potential impacts Management & mitigation
Global
macro-economic * Loss of confidence in public markets * Range of funding strategies
environment
Volatility
of global * Market reassessment of private company valuations * Depth of experience at Board-level
public and
private
markets * Global economic recession could lead to changes in * Strength of portfolio with a path to liquidity events
market and societal behaviours
* Strong investor relations
------------------------------------------------------------ ------------------------------------------------------------
COVID-19
Direct and * Share price volatility * Tech trends aligned to investment strategy
indirect
impact of
COVID-19 * Disrupted cross-border trade and impaired supply * Business continuity plan
pandemic chains
* Adapted working practices
* Reduced growth for portfolio companies in directly
impacted sectors
* Cloud-based IT infrastructure
* Physical / mental health risk to staff and/or
dependants * Resilience of majority of portfolio companies
* Impacted business culture through remote working * Health and safety for home working
* Safe return to office environment for those able to
do so on part-time basis
------------------------------------------------------------ ------------------------------------------------------------
Portfolio
company * Valuations subject to judgement and impacted by * Diversification of the portfolio across geographies
valuations external factors and sub-sectors
are subject
to change
* Illiquid assets susceptible to material recalibration * Measured approach to valuations, in line with IPEV
of tech valuations and BVCA guidelines
* Fund of Funds strategy
* Strong governance and discipline in investment
process
------------------------------------------------------------ ------------------------------------------------------------
Climate
change * Changing stakeholder expectations * Development and roll-out of ESG Policy
Need to
navigate
the energy * Increase in carbon-related regulations * Working with external carbon experts (ITPEnergised)
transition on carbon-related projects
* Potential lending conditions tied to climate and
carbon performance
* Employee attraction / retention aligned to attitudes
toward climate change
------------------------------------------------------------ ------------------------------------------------------------
Key personnel
Ability * Inability to grow as anticipated to meet financial * Competitive packages offered to personnel
to retain objectives
and attract
talent * Long-term incentives aligned to Group strategy
* Continued staff development
* Programme of enhanced benefits
------------------------------------------------------------ ------------------------------------------------------------
Impact of
Brexit * Economic, political and regulatory instability * Legal/regulatory advice taken
* Lost marketing passport rights into the EU * Dual-listing in London and Dublin
* Impact on cross-border sales structure * Partnership with Earlybird in Germany
* FX risk * Insulation of portfolio by global approach
* Flight risk of financial services work and dealflow * Attractiveness of UK to tech talent
from UK to continental Europe
* Government incentivising British business
------------------------------------------------------------ ------------------------------------------------------------
Geo-political
protectionism * Hurdle to portfolio cross-border M&A * Supporting portfolio with international structural
National optionality
/ international
governmental * Raised tariffs complicating supply chains and
protectionism hardware procurement * Participation in lobbying efforts on UK government
(e.g. through BVCA membership)
* Increased trend for tech IPOs in the UK
------------------------------------------------------------ ------------------------------------------------------------
Industry
competition * Greater deal competition * Experienced thesis-driven investment team
* Shortened period between investment rounds * Differentiated model
* Rise in pre-empted funding rounds * Strong pipeline sourcing
* Competitive investment prices, structures, and terms * Competitive pricing, terms and structure of proposed
investments
--
* Disciplined investment process
* Evolving ESG credentials
------------------------------------------------------------ ------------------------------------------------------------
Cyber security
* Business disruption * Utilisation of reliable software and hardware
* Financial liabilities linked to cyber risk * Appropriate IT security structures, policies and
procedures in place
* Loss of business critical or commercially sensitive
information * Cyber security subject to review, development and
adaptation as necessary
------------------------------------------------------------ ------------------------------------------------------------
FX exposure
* FX impact upon cash position or portfolio performance * Regular review of the possible impact of currency
movements on cash and valuations
* Portfolio companies generate revenues across a range
of currencies - degree of natural hedge
------------------------------------------------------------ ------------------------------------------------------------
Profile
of venture * Portfolio companies may fail or not be commercially * Rigorous due diligence processes by experienced
investments viable investment team
* Increased funding requirements for companies at an * Active management of portfolio with consent rights
earlier stage and board seats on portfolio companies
------------------------------------------------------------ ------------------------------------------------------------
Non-controlling
interest * Limited ability to protect the Group's position in * Active management, typically with a board seat in
in portfolio investments by virtue of minority position portfolio companies
companies
* Minority protections in place in legal documents for
investments
* Strong Group balance sheet provides enhanced capital
solutions to protect investment position
------------------------------------------------------------ ------------------------------------------------------------
Unpredictability
of exit * Unpredictability of realisations and cash returns * Maintenance of sufficient cash resources
timing
* Regular working capital reviews
* Financial performance oversight by the Board and
Executive Management team
------------------------------------------------------------ ------------------------------------------------------------
Reputational
risk associated * Reputational damage associated with shareholders who * Communication of culture and ideals by the Board and
with build a position in the company wider public relations function to actively seek
shareholders like-minded investors
------------------------------------------------------------ ------------------------------------------------------------
Loss of
Group regulated * Inability to perform investment manager function * Senior personnel internally vetted, assessed and
status which is critical to the business model appraised on an ongoing basis in line with SM&CR to
Dependency ensure fitness and propriety
upon Group
fund manager
permissions * Robust governance processes and procedures
* Enhanced compliance function, with external
compliance advisory support
* Clear lines of accountability and responsibility for
senior management functions
------------------------------------------------------------ ------------------------------------------------------------
Inadequate
governance * Potential for decision-makers to fail to adequately * Ongoing work to pro-actively fulfil FCA regulatory
discharge their duties or expose the Group to requirements External compliance and legal advisors
unacceptable levels of risk engaged to advise on an ongoing basis
------------------------------------------------------------ ------------------------------------------------------------
Default
on credit * The Company may be unable to draw further funds * Substantial headroom within agreed debt covenants
facility and/or could be required to repay any amounts loaned (which are closely monitored)
and pay unpaid interest
------------------------------------------------------------ ------------------------------------------------------------
Concentration
of value * Potential material adverse impact on overall value of * Diversification across sub-sectors and stages
in portfolio the portfolio if over-exposed to one or a small
number of assets which underperform
* Investment financial structure set up to provide
downside protection
* Expanded size/scale of the portfolio provides
additional protection of spreading investment risk,
and via Fund of Funds strategy
------------------------------------------------------------ ------------------------------------------------------------
The above summary of the principal risks and uncertainties
should be considered in conjunction with the additional details
provided in our Annual Report and Accounts for the year ended 31
March 2021, as well as the associated risk management processes
discussed in the same report.
Directors' Responsibilities Statement
The Directors confirm that these unaudited condensed
consolidated interim financial statements for the six months ended
30 September 2021 included in the Half-year Report have been
prepared in accordance with International Accounting Standard 34,
'Interim Financial Reporting' (IAS 34) as adopted by the European
Union, UK-adopted IAS 34, the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct
Authority and the Transparency (Directive 2004/109/ EC) Regulations
2007 (as amended) and that the Interim Management Report includes a
fair review of the information required by the Disclosure Guidance
and Transparency Rules ("DTR") 4.2.7R and 4.2.8R, namely:
The interim financial statements comprise:
- An indication of important events that have occurred during
the first six months of the 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 financial year; and
- Material related-party transactions that have taken place in
the first six months of the financial year and any material changes
in the related-party transactions described in the Company's last
Annual Report.
This responsibility statement was approved by the Board on 26
November 2021 and signed on its behalf by:
B.D. Wilkinson
Chief Financial Officer
26 November 2021
Condensed consolidated interim statement of comprehensive
income
for the period ended 30 September 2021
Unaudited Unaudited
Period Ended Period Ended
30 Sep 2021 30 Sep 2020
Notes GBP'm GBP'm
Change in gains on investments held at fair value through profit and loss 6 252.0 56.4
Fee income 10.0 6.0
-------------------------------------------------------------------------- ----- ------------- -------------
Total income 262.0 62.4
-------------------------------------------------------------------------- ----- ------------- -------------
Operating expenses
General administrative expenses (11.2) (6.6)
Depreciation and amortisation (0.4) (0.3)
Share based payments - resulting from Company share option scheme (1.6) (0.3)
Investment and acquisition costs (0.1) (0.1)
Exceptional items 24 (2.4) -
Total operating costs (15.7) (7.3)
-------------------------------------------------------------------------- ----- ------------- -------------
Profit from operations 246.3 55.1
-------------------------------------------------------------------------- ----- ------------- -------------
Finance income/(expense)
Net finance income/(expense) 7 1.1 (1.5)
Operating profit before tax 247.4 53.6
-------------------------------------------------------------------------- ----- ------------- -------------
Income taxes (29.4) 0.2
-------------------------------------------------------------------------- ----- ------------- -------------
Profit for the period 218.0 53.8
-------------------------------------------------------------------------- ----- ------------- -------------
Other comprehensive income/(expense) - -
Total comprehensive income for the period 218.0 53.8
-------------------------------------------------------------------------- ----- ------------- -------------
Earnings per share:
----------------------------------------------------- ---
Basic earnings per weighted average shares (pence) 8148 45
Diluted earnings per weighted average shares (pence) 8146 45
----------------------------------------------------- ---
The Notes on the pages below are an integral part of these
condensed consolidated interim financial statements.
Condensed consolidated interim statement of financial
position
As at 30 September 2021
Unaudited Audited
30 Sep 2021 31 Mar 2021
Notes GBP'm GBP'm
----------------------------------------------------------- ---------- ------------ ------------
Non-current assets
Intangible assets 9 10.8 10.9
Financial assets held at fair value through profit or loss 11 1,229.5 867.1
Property, plant and equipment 1.1 1.4
----------------------------------------------------------- ---------- ------------ ------------
Total non-current assets 1,241.4 879.4
----------------------------------------------------------- ---------- ------------ ------------
Current assets
Trade and other receivables 1.1 3.7
Cash and cash equivalents 140.6 158.4
Restricted cash 16(ii), 19 15.6 2.3
----------------------------------------------------------- ---------- ------------ ------------
Total current assets 157.3 164.4
----------------------------------------------------------- ---------- ------------ ------------
Current liabilities
Trade and other payables (11.2) (9.7)
Financial liabilities 16 (0.4) (0.3)
Total current liabilities (11.6) (10.0)
----------------------------------------------------------- ---------- ------------ ------------
Non-current liabilities
Deferred tax 13 (29.7) (0.4)
Financial liabilities 16 - (0.3)
Total non-current liabilities (29.7) (0.7)
----------------------------------------------------------- ---------- ------------ ------------
Net assets 1,357.4 1,033.1
----------------------------------------------------------- ---------- ------------ ------------
Equity
Share capital 14 1.5 1.4
Share premium account 14 615.9 508.3
Own shares reserve 17(i) (1.5) (0.3)
Other reserves 17(ii) 27.5 26.2
Retained earnings 714.0 497.5
----------------------------------------------------------- ---------- ------------ ------------
Total equity 1,357.4 1,033.1
----------------------------------------------------------- ---------- ------------ ------------
Net assets per share (pence) 8 887 743
----------------------------------------------------------- ---------- ------------ ------------
The condensed consolidated interim financial statements were
approved by the Board of Directors and authorised for issue on 26
November 2021.
B.D. Wilkinson
Chief Financial Officer
The Notes on the pages below are an integral part of these
condensed consolidated interim financial statements.
Condensed consolidated interim statement of cash flows
for the period ended 30 September 2021
Unaudited Unaudited
Period ended Period ended
30 Sep 2021 30 Sep 2020
Notes GBP'm GBP'm
--------------------------------------------------------------------------------- ----- ------------- -------------
Cash flows from operating activities
Profit for the period 218.0 53.8
Adjustments to reconcile operating profit to net cash flows used in operating
activities:
Revaluation of investments held at fair value through profit and
loss (252.0) (56.4)
Depreciation and amortisation 0.4 0.3
Share-based payments - resulting from Company share option scheme 15 1.6 0.3
Net finance (income)/expense 7 (1.1) 1.5
Deferred tax on investment portfolio 29.7 -
Decrease/(increase) in trade and other receivables and other working capital
movements 2.6 0.2
Increase/(decrease) in trade and other payables and other working capital
movements 1.3 1.3
Purchase of investments (165.0) (32.3)
Proceeds from disposals in underlying investment vehicles 67.5 105.6
Net loans made (to)/returned from underlying investment vehicles and Group
companies (12.9) (0.8)
Share options exercised and paid to employees (1.8) (0.5)
Net cash (used)/received in operating activities (111.7) 73.0
Tax paid - -
Net cash (outflow)/inflow from operating activities (111.7) 73.0
--------------------------------------------------------------------------------- ----- ------------- -------------
Cash flows from investing activities
Payments for property, plant and equipment (0.0) (0.1)
Net cash (outflow) from investing activities (0.0) (0.1)
--------------------------------------------------------------------------------- ----- ------------- -------------
Cash flows from financing activities
Net borrowing cash movements (0.6) (46.4)
Payment of lease liabilities (0.2) (0.2)
Interest received 0.1 0.2
Acquisition of treasury shares (1.2) -
Gross proceeds from issue of share capital 111.2 1.5
Equity issuance costs (3.5) -
Net cash inflow/(outflow) from financing activities 105.8 (44.9)
--------------------------------------------------------------------------------- ----- ------------- -------------
Net (decrease)/ increase in cash and cash equivalents (5.9) 28.0
--------------------------------------------------------------------------------- ----- ------------- -------------
Cash and cash equivalents at beginning of period 160.7 34.1
Exchange differences on cash and cash equivalents 1.4 -
--------------------------------------------------------------------------------- ----- ------------- -------------
Cash and cash equivalents at period-end 140.6 59.9
--------------------------------------------------------------------------------- ----- ------------- -------------
Restricted cash at period-end 15.6 2.2
--------------------------------------------------------------------------------- ----- ------------- -------------
Total cash and cash equivalents and restricted cash at period-end 156.2 62.1
--------------------------------------------------------------------------------- ----- ------------- -------------
The notes on the pages below are an integral part of these
condensed consolidated interim financial statements
Condensed consolidated interim statement of changes in
equity
for the period ended 30 September 2021
Attributable to equity holders
of the parent (GBP'm)
==================================== ====== =======================================================
Period ended 30 September Notes Share Share Own Other Retained Total
2021 (unaudited) capital premium shares reserves earnings equity
reserve
==================================== ====== ========= ========= ========= ========== ========== ========
Brought forward as at 1 April
2021 1.4 508.3 (0.3) 26.2 497.5 1,033.1
==================================== ====== ========= ========= ========= ========== ========== ========
Comprehensive income for
the year
Profit for the year - - - - 218.0 218.0
Total comprehensive income
for the year - - - - 218.0 218.0
==================================== ====== ========= ========= ========= ========== ========== ========
Contributions by and distributions
to the owners:
Issue of share capital 14 0.1 - - - - 0.1
Share premium 14 - 107.6 - - - 107.6
Options granted and awards
exercised 15 - - - 1.3 (1.5) (0.2)
Acquisition of own shares 17(i) - - (1.2) - - (1.2)
Total contributions by and
distributions to the owners 0.1 107.6 (1.2) 1.3 (1.5) 106.3
==================================== ====== ========= ========= ========= ========== ========== ========
Balance as at 30 September
2021 1.5 615.9 (1.5) 27.5 714.0 1,357.4
==================================== ====== ========= ========= ========= ========== ========== ========
Attributable to equity holders of
the parent (GBP'm)
==================================== =========================================================================
Period ended 30 September Notes Share Share Own Other Retained Total
2020 (unaudited) capital premium shares reserves earnings equity
reserve
==================================== ====== ========= ========= ========= ========== ========== ========
Brought forward as at 1 April
2020 1.2 400.7 - 26.2 231.4 659.5
==================================== ====== ========= ========= ========= ========== ========== ========
Comprehensive income for
the year
Profit for the year - - - - 53.8 53.8
Total comprehensive income
for the year - - - - 53.8 53.8
==================================== ====== ========= ========= ========= ========== ========== ========
Contributions by and distributions
to the owners:
Issue of share capital 14 - - - - - -
Share premium 14 - 1.1 - - - 1.1
Options granted and awards
exercised 15 - - - 0.3 - 0.3
Total contributions by and
distributions to the owners - 1.1 - 0.3 - 1.4
==================================== ====== ========= ========= ========= ========== ========== ========
Balance as at 30 September
2020 1.2 401.8 - 26.5 285.2 714.7
==================================== ====== ========= ========= ========= ========== ========== ========
The Notes on the pages below are an integral part of these
condensed consolidated interim financial statements.
Notes to the condensed consolidated interim financial
statements
1. General information
Molten Ventures plc (formerly Draper Esprit plc) (the "Company")
is a public limited company incorporated and domiciled in England
and Wales. On 23 July 2021, the Company's ordinary shares were
admitted to the premium listing segment of the Official List of the
Financial Conduct Authority and the secondary listing segment of
the Official List of the Irish Stock Exchange plc, trading as
Euronext Dublin and to trading on the London Stock Exchange plc's
main market for listed securities and the regulated market of
Euronext Dublin. Prior to this, between 15 June 2016 and 22 July
2021, the Company was listed on the London Stock Exchange's AIM
market and the Irish Stock Exchange's Euronext Growth market.
The Company is the ultimate parent company in which results of
all subsidiaries are consolidated. The condensed consolidated
interim financial statements for the period ended 30 September 2021
comprise the condensed consolidated interim financial statements of
the Company and its subsidiaries (together, "the Group"). These
condensed interim financial statements do not comprise statutory
accounts within the meaning of section 434 of the Companies Act
2006 and have been reviewed, not audited. The Annual Report and
Accounts for the year ended 31 March 2021 were approved by the
Board of Directors on 11 June 2021 and delivered to the Registrar
of Companies.
The report of the auditors on those accounts was unqualified,
did not contain an emphasis of matter paragraph and did not contain
any statement under section 498 of the Companies Act 2006.
The condensed consolidated interim financial statements are
presented in Pounds Sterling (GBP/GBP), which is the currency of
the primary economic environment in which the Group operates. All
amounts are rounded to the nearest million, unless otherwise
stated.
2. Going concern assessment and principal risks
Going concern
The Group's primary sources of liquidity are the cash flows it
generates from its operations, realisations of its investments and
borrowings. The primary use of this liquidity is to fund the
Group's operations (including the purchase of investments).
Responsibility for liquidity risk management rests with the Board,
which has established a framework for the management of the Group's
funding and liquidity management requirements. The Group manages
liquidity risk by maintaining adequate reserves and by continuously
monitoring forecast and actual cash flows.
The Group has undertaken a going concern assessment and the
latest assessment showed sufficient headroom for liquidity for at
least the next 12 months from the date of approval of these
financial statements.
The assessment of going concern, considered both the Group's
current performance and future outlook, including:
o An assessment of the Group's liquidity and solvency position
using a number of adverse scenarios to assess the potential impact
on the Group's operations and portfolio companies. These downside
scenarios include unpredictability of exit timing and portfolio
company valuations subject to change. The Group manages and
monitors liquidity regularly and continually assesses investments,
commitments, realisations, operating expenses, and receipt of
portfolio cash income including under stress scenarios ensuring
liquidity is adequate and sufficient. As at 30 September 2021, the
Directors believe the Group has sufficient cash resources and
liquidity and is well placed to manage the business risks in the
current economic environment.
o The Group must comply with financial and non-financial
covenants as part of the revolving credit facility with Silicon
Valley Bank and Investec. An assessment of forecast covenant
compliance was undertaken using a number of adverse scenarios on
valuations. Under each adverse scenario the Group still had
sufficient headroom in order to comply with the covenant
obligations.
After making enquiries and following challenge and review, the
Directors have a reasonable expectation that the Group has adequate
resources to continue in operational existence for the foreseeable
future. For this reason, they continue to adopt the going concern
basis in preparing the financial statements.
Principal risks
The Group has reviewed its exposure to its principal risks and
concluded that these did not have a significant impact on the
financial performance and/or position of the Group for the period
and as at 30 September 2021, respectively. For further details on
the Group's principal risks as well as its risk management
processes, please see the Principal Risks and Uncertainties section
in the Management Report to these accounts and the Risk Management
and Principal Risks Section of the Annual Report and Accounts for
the year ended 31 March 2021.
3. Adoption of new and revised standards
i. Adoption of new and revised standards
No changes to IFRS have impacted this period's financial
statements.
ii. Impact of standards issued but not yet applied
No upcoming changes under IFRS are likely to have a material
effect on the reported results or financial position. Management
will continue to monitor upcoming changes.
4. Significant accounting policies
Basis of accounting
These unaudited condensed consolidated interim financial
statements for the six months ended 30 September 2021 have been
prepared in accordance with International Accounting Standard 34,
'Interim Financial Reporting' (IAS 34) as adopted by the European
Union, UK-adopted IAS 34, the Disclosure Guidance and Transparency
Rules sourcebook of the United Kingdom's Financial Conduct
Authority and the Transparency (Directive 2004/109/ EC) Regulations
2007 (as amended). On 31 December 2020, EU-adopted IFRS at that
date was brought into UK law and became UK-adopted international
accounting standards, with future changes being subject to
endorsement by the UK Endorsement Board. The unaudited condensed
consolidated interim financial statements have transitioned to
UK-adopted international accounting standards from 1 April 2021.
There was no impact or changes in accounting policies from the
transition.
The unaudited condensed consolidated interim financial
statements for the six months ended 30 September 2021 were approved
by the Board of Directors for publication on 26 November 2021.
The annual financial statements of the Group for the year ended
31 March 2021 were prepared in accordance with international
accounting standards in conformity with the requirements of the
Companies Act 2006 which would have been consistent with
International Financial Reporting Standards (IFRSs) adopted
pursuant to Regulation (EC) No 1606/2002 as it applies in the EU.
Except as noted below, the condensed consolidated interim financial
statements have been prepared applying the accounting policies that
were applied in the preparation of the Group's published
consolidated financial statements for the year ended 31 March
2021.
a) Significant accounting policies
The condensed consolidated interim financial statements have
been prepared in accordance with the accounting policies adopted by
the Group's most recent Annual Report and Accounts for the year
ended 31 March 2021, other than the following:
Exceptional items
The Group classifies items of income and expenditure as
exceptional when the nature of the item or its size is likely to be
material, to assist the reader of the financial statements to
better understand the results of the operations of the Group. Such
items by their nature are not expected to recur and are shown
separately on the face of the consolidated statement of
comprehensive income.
5. Critical accounting estimates and judgements
The Directors have made the following judgements and estimates
that have had the most significant effect on the carrying amounts
of the assets and liabilities in the condensed consolidated interim
financial statements. The estimates and underlying assumptions are
reviewed on an ongoing basis. Revisions to accounting estimates are
recognised in the period in which the estimate is revised if the
revision affects only that period, or in the period of the revision
and future periods if the revision affects both current and future
periods. Actual results may differ from estimates. The key
estimate, (5)(a), and judgement, (5)(b), are discussed below. There
have been no changes to the accounting estimates and judgements in
the financial period ended 30 September 2021.
a) Valuation of unquoted equity investments at fair value
through profit and loss
The Group invests into Limited Companies and Limited
Partnerships which are considered to be investment companies that
invest for the benefit of the Group. These investment companies are
measured at fair value through profit or loss based on their NAV at
the period-/year-end. The Group controls these entities and is
responsible for preparing their NAV, which is based on the
valuation of their unquoted investments. The Group's valuation of
investments measured at fair value through profit or loss is
therefore dependent upon estimations of the valuation of the
underlying portfolio companies.
The Group, through its controlled investment companies also
invests in investment funds, which primarily focus on German or
seed investments. These investments are considered to be 'Fund of
Fund investments' for the Group and are recognised at their NAV at
the period/year-end date. These Fund of Fund investments are not
controlled by the Group and some do not have coterminous year ends
with the Group. To value these investments, management obtain the
latest financial statements of the investments and discuss further
movements with the management of the companies. Where the Fund of
Funds hold investments that are individually material to the Group,
management perform further procedures to determine that the
valuation of these investments has been prepared in accordance with
the Group's valuation policies for portfolio companies outlined
below and these valuations will be adjusted by the Group where
necessary based on the Group valuation policy for valuing portfolio
companies.
The estimates required to determine the appropriate valuation
methodology of investments means there is a risk of material
adjustment to the carrying amounts of assets and liabilities. These
estimates include whether to increase or decrease investment
valuations or not and require the use of assumptions about the
carrying amounts of assets and liabilities that are not readily
available or observable.
The fair value of investments is established with reference to
the International Private Equity and Venture Capital Valuation
Guidelines ("IPEV Guidelines"). An assessment will be made at each
measurement date as to the most appropriate valuation
methodology.
The Group invests in early-stage and growth technology
companies, through predominantly unlisted securities. Given the
nature of these investments, there are often no current or
short-term future earnings or positive cash flows. Consequently,
although not considered to be the default valuation technique, the
appropriate approach to determine fair value may be based on a
methodology with reference to observable market data, being the
price of the most recent transaction. Fair value estimates that are
based on observable market data will be of greater reliability than
those based on estimates and assumptions and accordingly where
there have been recent investments by third parties, the price of
that investment will generally provide a basis of the valuation.
Recent transactions may include post period-end as well as pre
period-end transactions depending on the nature and timing of these
transactions.
If this methodology is used, its initial use and the length of
time for which it remains appropriate to use the price of recent
investment depends on the specific circumstances of the investment,
and the Group will consider whether this basis remains appropriate
each time valuations are reviewed. In addition, the inputs to the
valuation model (e.g. revenue, comparable peer group, product
roadmap) will be recalibrated to assess the appropriateness of the
methodology used in relation to the market performance and
technical/product milestones since the round and the company's
trading performance relative to the expectations of the round.
The Group also considers alternative methodologies in the IPEV
Guidelines, being principally price-revenue or price-earnings
multiples, depending upon the stage of the asset, requiring
management to make assumptions over the timing and nature of future
revenues and earnings when calculating fair value. When using
multiples, we consider publicly traded multiples in similar lines
of business, which are adjusted based on the relative growth
potential and risk profile of the subject company versus the market
and to reflect the degree of control and lack of marketability.
Where a fair value cannot be estimated reliably, the investment
is reported at the carrying value at the previous reporting date
unless there is evidence that the investment has since been
impaired.
In all cases, valuations are based on the judgement of the
Directors after consideration of the above and upon available
information believed to be reliable, which may be affected by
conditions in the financial markets. Due to the inherent
uncertainty of the investment valuations, the estimated values may
differ significantly from the values that would have been used had
a ready market for the investments existed, and the differences
could be material. Due to this uncertainty, the Group may not be
able to sell its investments at the carrying value in these
financial statements when it desires to do so or to realise what it
perceives to be fair value in the event of a sale. See Note 18 and
19 for information on unobservable inputs used and sensitivity
analysis on investments held at fair value through profit and
loss.
b) Control assessment
The Group has a number of entities within its corporate
structure and a judgement has been made of which should be
consolidated in accordance with IFRS 10, and which should not. The
Group consolidates all entities where it has control over the
following: power over the investee to significantly direct the
activities; exposure, or rights, to variable returns from its
involvement with the investee, and the ability to use its power
over the investee to affect the amount of the investor's returns.
The Company does not consolidate qualifying investment companies it
controls in accordance with IFRS 10 and instead recognises them as
investments held at fair value through profit and loss.
6. Change in gains on investments held at fair value through profit and loss
Period ended 30 September 2021
GBP'm Period ended 30 September 2020 GBP'm
------------------------------------------------ ------------------------------ ------------------------------------
Change in unrealised gains on investments held
at fair value through profit and loss 188.5 (42.1)
------------------------------------------------ ------------------------------ ------------------------------------
Change in realised gains on investments held at
fair value through profit and loss 50.9 73.2
------------------------------------------------ ------------------------------ ------------------------------------
Net foreign exchange (/gain/(loss) on
investments held at fair value through profit
and loss 12.6 25.3
------------------------------------------------ ------------------------------ ------------------------------------
Total movements on investments held at fair
value through profit and loss 252.0 56.4
------------------------------------------------ ------------------------------ ------------------------------------
7. Finance income/(expense)
Period ended 30 September 2021
GBP'm Period ended 30 September 2020 GBP'm
------------------------------------------------ ------------------------------ ------------------------------------
Interest and expenses on loans and borrowings
(Note 16) (0.4) (1.6)
------------------------------------------------ ------------------------------ ------------------------------------
Finance costs (0.4) (1.6)
------------------------------------------------ ------------------------------ ------------------------------------
Net foreign exchange gain 1.4 -
------------------------------------------------ ------------------------------ ------------------------------------
Interest income on cash and cash equivalents 0.1 0.1
------------------------------------------------ ------------------------------ ------------------------------------
Finance income 1.5 0.1
------------------------------------------------ ------------------------------ ------------------------------------
Net finance income/(expense) 1.1 (1.5)
------------------------------------------------ ------------------------------ ------------------------------------
8. Earnings per share and net asset value
The calculation of basic earnings per weighted average shares is
based on the profit attributable to shareholders and the weighted
average number of shares. When calculating the diluted earnings per
share, the weighted average number of shares in issue is adjusted
for the effect of all dilutive share options and awards.
Basic earnings per ordinary share
Profit after tax No. of shares Pence
GBP'm 'm per share
30 September 2021 218.0 147.2 148
----------------- -------------- -----------
30 September 2020 53.8 119.0 45
----------------- -------------- -----------
Diluted earnings per ordinary share
Profit after tax No. of shares Pence
GBP'm 'm per share
30 September 2021 218.0 149.2 146
----------------- -------------- -----------
30 September 2020 53.8 119.5 45
----------------- -------------- -----------
Net asset value per share is based on the net asset attributable
to shareholders and the number of shares at the relevant reporting
date. When calculating the diluted earnings per share, the number
of shares in issue at balance sheet date is adjusted for the effect
of all dilutive share options and awards.
Net asset value per ordinary share
Net assets No. of shares Pence
GBP'm 'm per share
30 September 2021 1,357.4 153.0 887
----------- -------------- -----------
31 March 2021 1,033.1 139.1 743
----------- -------------- -----------
Diluted net asset value per ordinary share
Net assets No. of shares Pence
GBP'm 'm per share
30 September 2021 1,357.4 155.0 876
----------- -------------- -----------
31 March 2021 1,033.1 140.0 738
----------- -------------- -----------
9. Intangible assets
Goodwill(1) Customer contracts(2) Total
30 September 2021 GBP'm GBP'm GBP'm
------------------------------------------------- ----------- --------------------- ------
Cost
Cost carried forward as at 1 April 2021 10.4 1.1 11.5
Additions during the period - - -
Cost as at 30 September 2021 10.4 1.1 11.5
Accumulated amortisation
Amortisation carried forward as at 1 April 2021 - (0.6) (0.6)
Charge for the period - (0.1) (0.1)
------------------------------------------------- ----------- --------------------- ------
Accumulated amortisation as at 30 September 2021 - (0.7) (0.7)
Net book value:
As at 30 September 2021 10.4 0.4 10.8
------------------------------------------------- ----------- --------------------- ------
Goodwill(1) Customer contracts(2) Total
31 March 2021 GBP'm GBP'm GBP'm
------------------------------------------------ ----------- --------------------- ------
Cost
Cost carried forward as at 1 April 2020 9.7 0.8 10.5
Acquisition of business 0.7 0.3 1.0
------------------------------------------------ ----------- --------------------- ------
Cost as at 31 March 2021 10.4 1.1 11.5
Accumulated amortisation
Amortisation carried forward as at 1 April 2020 - (0.5) (0.5)
Charge for the year - (0.1) (0.1)
------------------------------------------------ ----------- --------------------- ------
Accumulated amortisation as at 31 March 2021 - (0.6) (0.6)
Net book value:
As at 31 March 2021 10.4 0.5 10.9
------------------------------------------------ ----------- --------------------- ------
1 In FY2021, goodwill of GBP0.7 million arose on the step
acquisition of all issued share capital in Elderstreet Holdings
Limited. Elderstreet Holdings Limited is the holding company of
Elderstreet Investments Limited, a VCT manager incorporated in the
UK, on 9 February 2021 and represents the value of the acquired
expertise and knowledge of the investment team. The Directors have
identified the fund managers as the cash-generating unit ("CGU")
being the smallest group of assets that generates cash inflows
independent of cash flows from other assets or groups of assets.
The fund managers are responsible for generating deal flow and
working closely with the investee companies to create value and
maximise returns for the Group. The Group tests goodwill annually
for impairment comparing the recoverable amount using value-in-use
calculations and the carrying amount. Value-in-use calculations are
based on future expected cash flows generated by the CGU fee income
from management fees over the next three years with reference to
the most recent financial budget and forecasts. A three-year cash
flow period was deemed appropriate for value in use calculation
given the terms of the Investment Management Agreement. The key
assumptions for the value in use calculations are the discount rate
using pre-tax rates that reflect the current market assessments of
the time value of money and risks specific to the CGU. The internal
rate of return ("IRR") will be based on past performance and
experience.
2 In FY2021, an intangible asset of GBP0.3 million was
recognised in respect of the anticipated profit from the
participation in Elderstreet Investments Limited following the
acquisition of the remaining issued share capital the Group did not
previously own on 9 February 2021.
10. Related undertakings
Please see below details of investments held by the Group's
investment companies, where the ownership percentage or partnership
interest exceeds 20%:
Interest FD category* at
reporting date/partnership
Name Address Type of shareholding interest
------------------------------- ------------------------------ --------------------- ------------------------------
Kingsfordweg 151, 1043 GR Ordinary shares
Bright Computing Holding B.V. Amsterdam, the Netherlands Preference shares E
------------------------------- ------------------------------ --------------------- ------------------------------
Churerstrasse 135, CH-8808 Ordinary shares
Ravenpack Holding AG Pfäffikon, Switzerland Preference shares D
------------------------------- ------------------------------ --------------------- ------------------------------
c/o Earlybird Venture Capital,
Earlybird GmBH & Co. Maximilianstr. 14, 80539,
Beteiligung-KG IV München Partnership interest 27%
------------------------------- ------------------------------ --------------------- ------------------------------
c/o Earlybird Venture Capital,
Earlybird DWES Fund VI GmbH & Maximilianstr. 14, 80539,
Co. KG München Partnership interest 56.5%
------------------------------- ------------------------------ --------------------- ------------------------------
c/o Earlybird Venture Capital,
Earlybird Special Opportunities Maximilianstr. 14, 80539,
LP München Partnership interest 34.8%
------------------------------- ------------------------------ --------------------- ------------------------------
*Fully diluted interest categorised as follows: Cat A: 0-5%, Cat
B: 6-10%, Cat C: 11-15%, Cat D: 16-25%, Cat E: >25%
Details of the FV of the core companies are detailed as part of
the Gross Portfolio Value table in the Interim Financial Review
above.
The latest publicly available accounts for the related
undertaking above reflect the following net assets and profit or
loss positions.
-- Bright Computing Holding B.V.: Net liabilities as at 31
December 2019 of US$9.5 million and a loss for the year ending 31
December 2019 of US$2.6 million.
11. Financial assets held at fair value through profit or
loss
The Group holds investments through investment vehicles it
manages. The investments are predominantly in unquoted securities
and are carried at fair value through profit and loss. See further
details on the fair value measurements of the Group's investments
in Note 5(a) and Note 18. The Group's valuation policies are set
out in detail in the Annual Report and Accounts for the year ended
31 March 2021. The table below sets out the movement in the balance
sheet value of investments from the start to the end of the year,
showing investments made, cash receipts and fair value
movements.
Unaudited Audited
As at As at
30 Sept 2021 31 Mar 2021
GBP'm GBP'm
------------------------------------------------- ------------- ------------
As at 1 April 867.1 657.3
Investments made in the period(1) 165.0 128.0
Investments settled in shares - -
Loans repaid from underlying investment vehicles (67.5) (206.3)
Loans made to underlying investment vehicles 12.9 11.8
Gains on the revaluation of investments 252.0 276.3
------------------------------------------------- ------------- ------------
As at period end 1,229.5 867.1
------------------------------------------------- ------------- ------------
1 Investments and loans made in the period/year are amounts the
Company has invested in underlying investment vehicles. This is not
the equivalent to the total amount invested in portfolio companies
as existing cash balances from the investment vehicles are
reinvested.
12. Operating segments
IFRS 8 Operating Segments defines operating segments as those
activities of an entity about which separate financial information
is available and which are evaluated by the Chief Operating
Decision Maker to assess performance and determine the allocation
of resource. The Chief Operating Decision Maker has been identified
by the Board of Directors as the Chief Executive Officer. The Group
has one operating segment identified, the investment portfolio of
the Group, which is monitored closely, and strategic decisions are
made on the basis of the investment portfolio performance.
13. Deferred tax
Deferred tax is calculated in full on temporary differences
under the liability method using a tax rate of 19% (31 March 2021:
19%). The movement on the deferred tax account is shown below:
Period ended 30 Sept 2021 Year ended 31 Mar 2021
GBP'm GBP'm
------------------------------------------ ------------------------- ----------------------
Arising on investment portfolio (29.7) -
------------------------------------------ ------------------------- ----------------------
Arising on business combination (0.1) (0.1)
------------------------------------------ ------------------------- ----------------------
Arising on co-invest and carried interest (0.3) (0.6)
------------------------------------------ ------------------------- ----------------------
Other timing differences 0.4 0.3
------------------------------------------ ------------------------- ----------------------
At the end of the period (29.7) (0.4)
------------------------------------------ ------------------------- ----------------------
14. Share capital and share premium
Ordinary share capital
30 September 2021 - Allotted and fully paid Number Pence GBP'm
------------------------------------------------------ ------------ ------- -------
At the beginning of the period 139,097,075 1 1.4
------------------------------------------------------ ------------ ------- -------
Issue of share capital during the period for cash(1) 13,902,778 1 0.1
------------------------------------------------------ ------------ ------- -------
At the end of the period 152,999,853 1 1.5
------------------------------------------------------ ------------ ------- -------
1.In June 2021, the Company raised gross proceeds of GBP111.2
million at a placing price of 800 pence per share by way of a
placing of 13,902,778 new ordinary shares.
30 September 2020 - Allotted and fully paid Number Pence GBP'm
------------------------------------------------------ ------------ ------- -------
At the beginning of the period 118,918,124 1 1.2
------------------------------------------------------ ------------ ------- -------
Issue of share capital during the period for cash(1) 289,835 1 -
------------------------------------------------------ ------------ ------- -------
At the end of the period 119,207,959 1 1.2
------------------------------------------------------ ------------ ------- -------
1.B etween 18 August 2020 and 16 September 2020, 289,835 new 1p
ordinary shares were issued in association with share options being
exercised.
31 March 2021 - Allotted and fully paid Number Pence GBP'm
------------------------------------------------------------------------------- ------------ ------- -------
At the beginning of the period 118,918,124 1 1.2
------------------------------------------------------------------------------- ------------ ------- -------
Issue of share capital during the period for share options being exercised(1) 359,131 1 -
------------------------------------------------------------------------------- ------------ ------- -------
Issue of share capital during the period cash(2) 19,819,820 1 0.2
------------------------------------------------------------------------------- ------------ ------- -------
At the end of the period 139,097,075 1 1.4
------------------------------------------------------------------------------- ------------ ------- -------
1.B etween August 2020 and March 2021, 359,131 new 1 pence
ordinary shares were issued in association with share options being
exercised.
2.In October 2020, the Company secured commitments to raise
gross proceeds of GBP110.0 million at a placing price of 555 pence
per share by way of a conditional placing of 19,819,820 new
ordinary shares.
Share premium
Allotted and fully paid Period ended Period ended Year ended
30 Sep 2021 30 Sep 2020 31 Mar 2021
GBP'm GBP'm GBP'm
At the beginning of the period 508.3 400.7 400.7
Premium arising on the issue of ordinary shares 111.2 1.1 111.1
Equity issuance costs (3.6) - (3.5)
------------------------------------------------- ------------- ------------- -------------
At the end of the period 615.9 401.8 508.3
------------------------------------------------- ------------- ------------- -------------
15. Share-based payments
Date of b/f1 Granted Lapsed Exercised c/f 30 Approved Vesting Exercise Fair value
Grant April in the in the in the Sep 2021 options period Price per
2021 period period period (pence) granted
instrument
(pence)
Molten
Ventures plc
2016 Company
Share Option
Scheme
(formerly the
Draper Esprit
plc 2016
Company Share
Option
Scheme)
("CSOP") 28-Nov-16 612,959 - - (82,090) 530,869 33,800 3 years 355 64.1
28-Nov-16 101,685 - - - 101,685 - 3 years 355 89.3
11-Nov-17 120,000 - - - 120,000 8,356 3 years 354 89.8
28-Nov-17 368,335 - - (77,524) 290,811 - 3 years 387 70.9
28-Nov-17 116,016 - - - 116,016 - 3 years 387 97.9
30-Jul-18 842,550 - - (178,100) 664,450 - 3 years 492 152.9
30-Jul-18 102,750 - - - 102,750 - 3 years 492 186.4
12-Feb-19 735,302 - - - 735,302 - 3 years 530 67.8
12-Feb-19 75,000 - - - 75,000 - 3 years 530 95.2
26-Nov-19 200,000 - - - 200,000 - 3 years 467 71.5
29-Jun-20 200,000 - - - 200,000 - 3 years 449 81.2
26-Jul-21 - 54,792 - - 54,792 - 1 year 1 986.0
Molten
Ventures plc
Long-Term
Incentive
Plan
(formerly the
Draper Esprit
plc Long Term
Incentive
Plan)
("LTIP") 29-Jun-20 581,696 - (1,559) - 580,137 - 3 years 1 449.0
16-Jul-21 - 581,212 - - 581,212 - 3 years 1 940.0
Total 4,056,293 636,004 (1,559) (337,714) 4,353,024 42,156
During the period, 0.1 million of options were granted under the
CSOP and 0.6 million under the LTIP.
Both the CSOP and LTIP are, as of 30 September 2021, partly
administered by the Molten Ventures Employee Benefit Trust
(formerly the Draper Esprit Employee Benefit Trust) ("Trust"). The
Trust is consolidated in these condensed consolidated interim
financial statements. The Trust may purchase shares from the market
and, from time to time, when the options are exercised, the Trust
transfers the appropriate number of shares to the employee or sells
these as agent for the employee. The proceeds received, net of any
directly attributable transaction costs, are credited directly to
equity. Shares held by the Trust at the end of the reporting period
are shown as own shares in the financial statements. Of the 0.3
million options exercised during the year, none were satisfied with
new ordinary shares issued by Molten Ventures plc.
For share options granted under the Molten Ventures plc 2016
Company Share Options Plan (formerly the Draper Esprit plc 2016
Company Share Options Plan), the Black-Scholes Option Pricing Model
has been used for valuation purposes. All options are settled in
shares. Volatility is expected to be in the range of 20-30% based
on an analysis of the Company's and peer group's share price. The
risk-free rates used were taken from zero coupon United Kingdom
government bonds on a term consistent with the vesting period.
There are no performance conditions attached to the share options
granted under the Molten Ventures plc 2016 Company Share Options
Plan (formerly the Draper Esprit plc 2016 Company Share Options
Plan).
Share options granted during the year under the LTIP vest if
certain performance standards are met. The amount of options that
will vest depends on performance conditions included within the
agreement relating to realisations, assets under management, and
Total Shareholder Return ("TSR"). These options are granted under
the plan for no consideration and are granted at a nominal value of
1p. All options are settled in shares. The fair value of the LTIP
shares will be valued using the Black-Scholes model. A six-monthly
review takes place of non-market performance conditions and as at
30 September 2021, we are currently on target for LTIPs issued in
2020.
The share-based payment charge for the period is GBP1.6 million
(six-months ended 30 September 2020: GBP0.3 million).
16. Financial liabilities
Unaudited Audited
30 Sep 2021 31 Mar 2021
GBP'm GBP'm
---------------------------------------- ------------ ------------
Current liabilities
Leases (0.4) (0.3)
Loans and borrowings - -
Total current financial liabilities (0.4) (0.3)
---------------------------------------- ------------ ------------
Non-current liabilities
Leases (0.5) (0.7)
Loans and borrowings 0.5 0.4
Total non-current financial liabilities - (0.3)
---------------------------------------- ------------ ------------
Total financial liabilities (0.4) (0.6)
---------------------------------------- ------------ ------------
(i) Leases
This Note provides information for leases where the Group is a
lessee. The Group is not a lessor.
Real Estate Leases
The Group leases office buildings in London for use by its
staff. The Group also has an office in Dublin, however this
contract is classified as a service contract and not a lease.
Information about leases for which the Group is a lessee is
presented below.
The Group leases IT equipment such as printers for use by staff.
The Group has elected to apply the recognition exemption for leases
of low value to these leases.
(i) Amounts recognised on consolidated statement of financial
position
Right-of-use assets
Period ending 30 Sep 2021 Year ending 31 Mar 2021
GBP'm GBP'm
--------- ------------------------- -----------------------
Property 0.8 1.0
--------- ------------------------- -----------------------
Total 0.8 1.0
--------- ------------------------- -----------------------
Lease liabilities
Period ending 30 Sep 2021 Year ending 31 Mar 2021
GBP'm GBP'm
------------ ------------------------- -----------------------
Current (0.4) (0.3)
Non-current (0.5) (0.7)
Total (0.9) (1.0)
------------ ------------------------- -----------------------
Additions to the right-of-use assets during the period ending 30
September 2021 were GBPNil (year ending 31 March 2021: GBPNil).
(ii) Amounts recognised in the consolidated statement of profit
or loss The following amounts relate to leases:
Amounts recognised in the interim condensed consolidated
statement of profit or loss
Period ending 30 Sep 2021 Period ending 30 Sep 2020
GBP'm GBP'm
---------------------------------------------------------------- ------------------------- -------------------------
Interest on lease liabilities - -
Depreciation charge for the period on right-of-use assets 0.2 0.2
Expenses relating to short-term leases - -
Expenses relating to leases of low-value assets, excluding -
short-term leases of low-value
assets -
---------------------------------------------------------------- ------------------------- -------------------------
The total cash outflow for leases in the period ending 30
September 2021 was GBP0.2 million (period ending 30 September 2020
GBP0.2 million).
(ii) Loans and borrowings
In May 2021, the Company's existing revolving credit facility
with Silicon Valley Bank and Investec was extended to GBP65.0
million with a maturity of June 2024. The Company incurred costs of
GBP0.3 million in respect of the increase and extension of the
facility during the period, which are presented within loans and
borrowings on the statement of financial position and are amortised
over the life of the facility. Interest-related charges are
reported in the condensed consolidated statement of comprehensive
income as finance costs (see Note 7). The bank loans are secured on
agreed assets of the Group within the asset class of investments,
updated as agreed with the Financiers from time to time, and are
subject to customary financial and non-financial covenant
conditions which the Group must comply.
The facility agreement contains financial and non-financial
covenants.
(a) There must be a minimum of ten core investments at all times
(core investments are not defined in the same way as in this
Interim Report (as it is more broadly defined));
(b) The ratio of the NAV of all investments (as defined in the
agreement) to original investment cost should not be less than
1.1:1.0 at any time; and
(c) The ratio of the NAV (as defined in the agreement) plus
amounts in the collateral account to financial indebtedness (as
defined in the agreement) should not be less than 10:1 at any
time.
In addition, the borrowing base (as defined in the agreement)
must exceed the facility amount.
As collateral for interest payments, an amount equal to the
aggregate amount of interest costs due for the coming six months,
all being equal, must be held in an Interest Reserve Account at all
times. The balance of this at 30 September 2021 was GBP2.3 million
(31 March 2021: GBP2.3 million) and is reflected on the condensed
consolidated interim statement of financial position as restricted
cash.
The debt facility is repayable on maturity (June 2024) but may
become repayable earlier if certain conditions are not met.
As at 30 September 2021, the Company has drawn down GBPNil of
the GBP65.0 million facility (31 March 2021: GBPNil of the GBP60.0
million facility).
Period ended 30 Sept 2021 Period ended 30 Sept 2020 Year ended 31 Mar 2021
GBP'm GBP'm GBP'm
---------------------------------- -------------------------- -------------------------- ------------------------
Bank loan senior facility amount 65.0 60.0 60.0
Interest rate BOE base rate + 6.25% / BOE base rate + 6.75% / BOE base rate + 6.75% /
0.00% floor 7.50% floor 7.50% floor
Drawn at balance sheet date - - -
Arrangement fees (0.5) (0.5) (0.4)
---------------------------------- -------------------------- -------------------------- ------------------------
Loan liability balance (0.5) (0.5) (0.4)
---------------------------------- -------------------------- -------------------------- ------------------------
Undrawn facilities at balance
sheet date 65.0 60.0 60.0
---------------------------------- -------------------------- -------------------------- ------------------------
17. Own shares and other reserves
(i) Own shares reserve
Own shares are shares held in Molten Ventures plc that are held
by Molten Ventures Employee Benefit Trust (formerly the Draper
Esprit Employee Benefit Trust) ("Trust") for the purpose of issuing
shares under the Molten Ventures plc 2016 Company Share Options
Plan and Long-Term Incentive Plan (formerly the Draper Esprit plc
2016 Company Share Options Plan and Long-Term Incentive Plan).
Shares issued to employees are recognised on a weighted average
cost basis. The Trust holds 0.1% of the issued share capital at 30
September 2021.
Period ended 30 Sept 2021 Period ended 30 Sept 2020 Year ended 31 Mar 2021
No. of shares m GBP'm No. of shares m GBP'm No. of shares m GBP'm
--------------------------- ------------------- ------- ------------------- ------- ----------------- ------
Opening balance (0.1) (0.3) - - - -
Acquisition of shares by
the Trust (0.1) (1.2) - - (0.3) (2.3)
Disposal or transfer of
shares by the Trust - - - - 0.2 2.0
Closing balance (0.2) (1.5) - - (0.1) (0.3)
--------------------------- ------------------- ------- ------------------- ------- ----------------- ------
(ii) Other reserves
The following table shows a breakdown of the "other reserves"
line in the condensed consolidated interim statement of financial
position and the movements in those reserves during the period. A
description of the nature and purpose of each reserve is provided
below the table.
Share-based payments Share-based payments
reserve - resulting reserve resulting from
from company share acquisition of
Period to 30 September Merger relief reserve option scheme subsidiary Total other reserves
2021 GBP'm GBP'm GBP'm GBP'm
------------------------ --------------------- ---------------------- ----------------------- --------------------
Opening balance 13.1 2.3 10.8 26.2
Share-based payments - 1.6 - 1.6
Share-based payments -
exercised during the
period - (0.3) - (0.3)
------------------------ --------------------- ---------------------- ----------------------- --------------------
Closing balance 13.1 3.6 10.8 27.5
------------------------ --------------------- ---------------------- ----------------------- --------------------
Share-based payments Share-based payments
reserve - resulting reserve resulting from
from company share acquisition of
Period to 30 September Merger relief reserve option scheme subsidiary Total other reserves
2020 GBP'm GBP'm GBP'm GBP'm
------------------------ --------------------- ---------------------- ----------------------- --------------------
Opening balance 13.1 2.3 10.8 26.2
Share-based payments - 0.3 - 0.3
Share-based payments -
exercised during the
year - - - -
------------------------ --------------------- ---------------------- ----------------------- --------------------
Closing balance 13.1 2.6 10.8 26.5
------------------------ --------------------- ---------------------- ----------------------- --------------------
Share-based payments Share-based payments
reserve - resulting reserve resulting from
from company share acquisition of
Merger relief reserve option scheme subsidiary Total other reserves
Year to 31 March 2021 GBP'm GBP'm GBP'm GBP'm
------------------------ --------------------- ---------------------- ----------------------- --------------------
Opening balance 13.1 2.3 10.8 26.2
Share-based payments - 0.8 - 0.8
Share-based payments -
exercised during the
year - (0.8) - (0.8)
------------------------ --------------------- ---------------------- ----------------------- --------------------
Closing balance 13.1 2.3 10.8 26.2
------------------------ --------------------- ---------------------- ----------------------- --------------------
Merger relief reserve
In accordance with the Companies Act 2006, a Merger Relief
Reserve of GBP13.1 million (net of the cost of share capital issued
of GBP80k) was created on the issue of 4,392,332 ordinary shares
for 300 pence each in Molten Ventures plc (formerly Draper Esprit
plc) as consideration for the acquisition of 100% of the capital
interests in Esprit Capital Partners LLP on 15 June 2016.
Share-based payment reserve
Where the Group engages in equity-settled share-based payment
transactions, the fair value at the date of grant is recognised as
an expense over the vesting period of the options. The
corresponding credit is recognised in the share-based payment
reserve. Please see Note 15 for further details on how the fair
value at the date of grant is recognised.
18. Fair value measurements
i. Fair value hierarchy
This section explains the judgements and estimates made in
determining the fair values of the financial instruments that are
recognised and measured at fair value in the financial statements.
This section should be read with reference to Note 5 and Note
11.
The Group classifies financial instruments measured at fair
value through profit and loss ("FVTPL") according to the following
fair value hierarchy prescribed under the accounting standards:
-- Level 1: inputs are quoted prices (unadjusted) in active
markets for identical assets or liabilities that the entity can
access at the measurement date;
-- Level 2: inputs are inputs, other than quoted prices included
within Level 1, that are observable for the asset or liability,
either directly or indirectly; and
-- Level 3: inputs are unobservable inputs for the asset or liability.
All financial instruments measured at FVTPL in FY2021 and H12022
are financial assets relating to holdings in high-growth technology
companies. The Group invests in special purpose vehicles and
limited partnerships which are considered to be investment
companies that invest in equities for the benefit of the Group.
These investment companies (as set out in Note 3(b) in the Annual
Report and Accounts for the year ending 31 March 2021) are held at
their respective net asset values and, as such, are noted to be all
Level 3 for FY2021 and H12022. For details of the reconciliation of
those amounts please refer to Note 11. However, the additional
disclosures below are made on a look-through basis and are also
based on the Gross Portfolio Value ("GPV"). For details of the GPV
and its reconciliation to the investment balance in the financial
statements, please refer to the Interim Financial Review.
Fair value
measurements
At 30 September Level 1 Level 2 Level 3 Total
2021 GBP'm GBP'm GBP'm GBP'm
Financial assets
Financial assets
at fair value
through profit
or loss
Quoted investments 210.7 - - 210.7
Unquoted investments - - 1,137.1 1,137.1
--------------------- ------- ------- ------- -------
Total financial
assets 210.7 - 1,137.1 1,347.8
--------------------- ------- ------- ------- -------
Fair value
measurements
At 31 March Level 1 Level 2 Level 3 Total
2021 GBP'm GBP'm GBP'm GBP'm
Financial assets
Financial assets
at fair value
through profit
or loss
Quoted investments 85.5 - - 85.5
Unquoted investments - - 895.7 895.7
--------------------- ------- ------- ------- ------
Total financial
assets 85.5 - 895.7 981.2
--------------------- ------- ------- ------- ------
During the period ended 30 September 2021, there were transfers
out of Level 3 and into Level 1 following the listing of two
investments, one of which is held via our partnership with
Earlybird, as well as a listed addition to our Fund of Funds
portfolio - see (iii) below for movements. No other transfers
occurred in the period. The Group's policy is to recognise
transfers into and out of fair value hierarchy levels as at the end
of the reporting period.
ii. Valuation techniques used to determine fair values
The fair value of unlisted securities is established with
reference to the International Private Equity and Venture Capital
Valuation Guidelines ("IPEV Guidelines"). In line with the IPEV
Guidelines, the Group may base valuations on earnings or revenues
where applicable, market comparables, calibrated price of recent
investment in the investee companies, or on net asset values of
underlying funds ("NAV of underlying funds"). An assessment will be
made at each measurement date as to the most appropriate valuation
methodology, including that for investee companies owned by
third-party funds that Molten Ventures plc (formerly Draper Esprit
plc) invests in and which are valued on a look-through basis.
Financial instruments, measured at fair value, categorised as
Level 3 can be split into three main valuation techniques:
- Calibrated price of recent investment
- NAV of underlying fund
- Revenue-multiple
Each portfolio company will be subject to individual
assessment.
For a valuation based on a revenue-multiple, the main assumption
is the multiple. The multiple is derived from comparable listed
companies or relevant market transaction multiples. Companies in
the same industry and geography, and, where possible, with a
similar business model and profile are selected and then adjusted
for factors including liquidity risk, growth potential and relative
performance. They are also adjusted to represent our longer-term
view of performance through the cycle of our existing
assumption.
For a valuation based on calibrated price of recent investment,
the recent round enterprise value is calibrated against the
equivalent value using a revenue-multiple valuation methodology as
well as in relation to technical/product milestones since the round
and the company's trading performance relative to the expectations
of the round.
Where the Group invests in fund of fund investments, the value
of the portfolio will be reported by the fund to the Group. The
Group will ensure that the valuations comply with the Group policy
and that they are calibrated with any cash and known valuation
movements where reporting periods do not align.
See also Note 5(a) where valuation policies are discussed in
more detail.
iii. Fair value measurements using significant unobservable inputs (Level 3)
The table below presents the changes in Level 3 items for the
period ending 30 September 2021 and year ending 31 March 2021.
Movements in Level 3 items GBP'm
Opening balance at 1 April 2020 701.1
================================================= ========
Investments 128.0
Gains 357.8
Realisations (205.7)
================================================= ========
Unadjusted closing balance at 31 March 2021 981.2
================================================= ========
Transfer to Level 1 (85.5)
================================================= ========
Closing balance at 31 March 2021 895.7
================================================= ========
Investments 163.0
Gains 232.0
Realisations (65.0)
================================================= ========
Unadjusted closing balance at 30 September 2021 1,225.7
================================================= ========
Transfer to Level 1 (88.6)
Closing balance at 30 September 2021 1,137.1
================================================= ========
iv. Valuation inputs and relationships to fair value
The following table summarises the methodologies used by the
Group to measure fair value of Level 3 instruments:
H1'FY2022
Fair Significant input Sensitivity -
value effect of enterprise
value movement
on total fair
value
Investments GBP'm Valuation technique GBP'm
-------- ------------------- ------------------------
+15% -10%
Calibrated round
enterprise value
- recent round enterprise
value is calibrated
Calibrated against the equivalent
price of value using a revenue-multiple
Unquoted recent valuation methodology,
equity 504.7 investment amongst other factors. 566.2 447.0
Implied revenue
multiple -the portfolio
we have is diversified
across sectors and
geographies and
the companies which
have valuations
based on revenue-multiples
have a range of
multiples of between
1.1x - 19.0x and
Market a weighted average
465.6 comparables multiple of 10.9x. 528.2 412.8
NAV of funds, adjusted
where required -
net asset values
of underlying funds
reported by the
manager. These are
reviewed for compliance
with our policies
and are calibrated
for any cash and
known valuation
NAV of movements where
underlying reporting periods
166.8 fund do not align. 191.9 150.2
------------ -------- ------------------- -------------------------------- ----------- -----------
Total 1,137.1 1,286.3 1,010.0
------------ -------- ------------------- -------------------------------- ----------- -----------
FY21
Fair Significant input Sensitivity -
value effect of % enterprise
value movement
on total fair
value
--------------------------------
Investments GBP'm Valuation GBP'm
technique
------- ------------------ -------------------------------- --------------------------
+15% -10%
Calibrated round
enterprise value
- recent round enterprise
value is calibrated
against the equivalent
Calibrated value using a revenue-multiple
Unquoted price of valuation methodology,
equity 450.5 recent investment amongst other factors. 518.1 405.4
Implied revenue
multiple - the portfolio
we have is diversified
across sectors and
geographies and
the companies which
have valuations
based on revenue-multiples
have a range of
multiples of between
0.6x - 9.1x and
a weighted average
326.6 Market comparables multiple of 4.8x. 375.5 294.0
NAV of funds, adjusted
where required -
net asset values
of underlying funds
reported by the
manager. These are
reviewed for compliance
with our policies
and are calibrated
for any cash and
known valuation
movements where
NAV of underlying reporting periods
118.6 fund do not align. 136.4 106.8
------------ ------- ------------------ -------------------------------- -------------- ----------
Total 895.7 1,030.0 806.2
------------ ------- ------------------ -------------------------------- -------------- ----------
v. Valuations processes
The Audit, Risk and Valuations Committee is responsible for
ensuring that the financial performance of the Group is properly
reported on and monitored. A bi-annual strategy day is held every
six months to discuss the investment performance and valuations of
the portfolio companies. The investment team leads discussions
focused on business performances and key developments, exit
strategy and timelines, revenue and EBITDA progression, funding
rounds and latest capitalisation table, and valuation metrics of
listed peers. Valuations are prepared every six months by the
Finance team during each reporting period, with direct involvement
and oversight from the Chief Financial Officer ("CFO"). Challenge
and approvals of valuations are led by the Audit, Risk and
Valuations Committee every six months, in line with the Groups'
half-yearly reporting periods.
19. Financial instruments risk
Financial risk management
Financial risks are usually grouped by risk type: market,
liquidity and credit risk. These risks are discussed in turn
below.
Market risk - Foreign currency
A significant portion of the Group's investments and cash
deposits are denominated in a currency other than sterling. The
principal currency exposure risk is to changes in the exchange rate
between GBP and USD/EUR. Presented below is an analysis of the
theoretical impact of 10% volatility in the exchange rate on
shareholder equity.
Theoretical impact of a change in the exchange rate of +/-10%
between GBP and USD/EUR would be as follows:
30 Sep 2021 31 Mar 2021
Foreign currency exposures - Investments GBP'm GBP'm
----------------------------------------- ----------- -----------
Investments denominated in EUR 489.9 286.6
10% decrease in GBP 544.3 318.4
10% increase in GBP 445.3 260.5
Investments denominated in USD 414.1 477.8
10% decrease in GBP 460.1 530.8
10% increase in GBP 376.5 434.4
----------------------------------------- ----------- -----------
Certain cash deposits held by the Group are denominated in Euros
and US Dollars. The theoretical impact of a change in the exchange
rate of +/-10% between GBP and USD/EUR would be as follows:
30 Sep
2021 31 Mar 2021
Foreign currency exposures - Cash GBP'm GBP'm
---------------------------------- ------ -----------
Cash denominated in EUR 29.0 40.6
10% decrease in EUR: GBP 26.1 36.5
10% increase in EUR: GBP 31.9 44.6
Cash denominated in USD 23.3 26.3
10% decrease in USD: GBP 21.0 23.6
10% increase in USD: GBP 25.6 28.9
The combined theoretical impact on shareholders' equity of the
changes to revenues, investments and cash and cash equivalents of a
change in the exchange rate of +/- 10% between GBP and USD/EUR
would be as follows:
30 Sep
2021 31 Mar 2021
Foreign currency exposures - Equity GBP'm GBP'm
------------------------------------ ------- -----------
Shareholders' Equity 1,357.4 1,033.1
10% decrease in EUR: GBP/USD: GBP 1,221.7 929.8
10% increase in EUR: GBP/USD: GBP 1,493.2 1,136.5
Market risk - Price risk
Market price risk arises from the uncertainty about the future
prices of financial instruments held in accordance with the Group's
investment objectives. It represents the potential loss that the
Group might suffer through holding market positions in the face of
market movements.
The Group is exposed to equity price risk in respect of equity
rights and investments held by the Group and classified on the
balance sheet as financial assets at fair value through profit and
loss (Note 18). These equity rights are held in unquoted high
growth technology companies and are valued by reference to revenue
or earnings multiples of quoted comparable companies, calibrated
price of recent investment, or NAV of underlying fund - as
discussed more fully in Note 5(a). These valuations are subject to
market movements.
The Group seeks to manage this risk by routinely monitoring the
performance of these investments, employing stringent investment
appraisal processes.
Theoretical impact of a fluctuation in equity prices of +/-10%
would be as follows:
Valuation methodology
------------------------ -------------------------------------------------------------------------------
GBP'm Revenue-multiple NAV of underlying fund Calibrated price of recent investment
------------------------ ---------------- ---------------------- -------------------------------------
As at 30 September 2021 52.7 16.7 57.8
As at 31 March 2021 32.6 11.8 45.1
------------------------ ---------------- ---------------------- -------------------------------------
We further flexed by 15% given the volatility resulting from the
COVID-19 pandemic. Theoretical impact of a fluctuation in equity
prices of +/-15% would be as follows:
Valuation methodology
------------------------ -------------------------------------------------------------------------------
GBP'm Revenue-multiple NAV of underlying fund Calibrated price of recent investment
------------------------ ---------------- ---------------------- -------------------------------------
As at 30 September 2021 62.6 25.0 61.5
As at 31 March 2021 48.9 17.8 67.6
------------------------ ---------------- ---------------------- -------------------------------------
Liquidity risk
Cash and cash equivalents comprise of cash and short-term bank
deposits with an original maturity of three months or less held in
readily accessible bank accounts. Restricted cash includes GBP2.3
million of collateral for interest payments on the revolving credit
facility (see Note 16(ii)) as well as fixed term deposits with a
maturity date of more than 3 months from 30 September 2021 of
GBP13.3 million. The carrying amount of these assets is
approximately equal to their fair value. Responsibility for
liquidity risk management rests with the Board of Molten Ventures
plc, which has established a framework for the management of the
Group's funding and liquidity management requirements. The Group
manages liquidity risk by maintaining adequate reserves and by
continuously monitoring forecast and actual cash flows. The
utilisation of the loan facility and requirement for utilisation
requests is monitored as part of this process.
All trade payable amounts are short-term.
Lease liabilities fall due over the term of the lease - see Note
16 for further details. The debt facility has a term of 3 years -
for further details, see Note 16. All other Group payable balances
at balance sheet date and prior periods fall due for payment within
one year.
As part of our seed fund of funds strategy, we make commitments
to funds to be drawn down over the life of the fund. Projected
drawdowns are monitored as part of the monitoring process above.
For further details, see Note 21.
Credit risk
Credit risk refers to the risk that a counterparty will default
on its contractual obligations resulting in financial loss. The
Group is exposed to this risk for various financial instruments,
for example by granting receivables to customers, placing deposits.
The Group's trade receivables are amounts due from the investment
funds under management, or underlying portfolio companies. The
Group's maximum exposure to credit risk is limited to the carrying
amount of trade receivables, cash and cash equivalents, and
restricted cash at 30 September, as summarised below:
30 Sept
2021 31 Mar 2021
Classes of financial assets impacted by credit risk, carrying amounts GBP'm GBP'm
---------------------------------------------------------------------- ------- -----------
Trade receivables 0.2 2.5
Cash at bank and on hand 140.6 158.4
Restricted cash 15.6 2.3
Total 156.4 163.2
---------------------------------------------------------------------- ------- -----------
The Directors consider that all the above financial assets that
are not impaired or past due for each of the reporting dates under
review are of good credit quality. In respect of trade and other
receivables, the Group is not exposed to significant risk as the
principal customers are the investment funds managed by the Group,
and in these the Group has control of the banking as part of its
management responsibilities.
Investments in unlisted securities are held within limited
partnerships for which Esprit Capital Partners LLP acts as manager,
and consequently the Group has responsibility itself for collecting
and distributing cash associated with these investments. The credit
risk of amounts held on deposit is limited by the use of reputable
banks with high quality external credit ratings and as such is
considered negligible. The Group has an agreed list of authorised
counterparties. Authorised counterparties and counterparty credit
limits are established within the parameters of the Group Treasury
Policy to ensure that Group deals with creditworthy counterparties
and that counterparty concentration risk is addressed. Any changes
to the list of authorised counterparties are proposed by the CFO
after carrying out appropriate credit worthiness checks and any
other appropriate information and the changes require approval from
the Board. Cash at 30 September 2021 is held with the following
institutions: (1) Barclays Bank Plc; (2) Silicon Valley Bank Plc;
(3) Investec Bank Plc; and (4) EFG Private Bank Limited.
Capital management
The Group's objectives when managing capital are to
-- safeguard their ability to continue as a going concern, so
that they can continue to provide returns for shareholders and
benefits for other stakeholders, and
-- maintain an optimal capital structure.
The Group is funded through equity at balance sheet date. The
Group has a revolving credit facility in place, with no drawdowns
at 30 September 2021 (31 March 2021: no drawdowns). Please refer to
Note 16(ii) for further details regarding the revolving credit
facility.
In order to maintain or adjust the capital structure, the Group
may make distributions to shareholders, return capital to
shareholders, issue new shares or sell assets to manage cash.
Interest rate risk
The Group's interest rate risk arises from borrowings on the
GBP65.0 million loan facility with Silicon Valley Bank and
Investec, which was entered into in June 2019. Prior to the period
ending 30 September 2019, the Group did not have any borrowings.
The Group's borrowings are denominated in GBP and are carried at
amortised cost.
No drawdowns were made on the facility during the period and
nothing is drawn as at 30 September 2021. The facility agreement
has an interest rate calculated with reference to the Bank of
England base rate (currently 0.1%) with a margin of 6.25%. The
agreement does not have an interest rate floor. As such, if the
base rate increases, the interest charged on future drawdowns will
increase.
20. Related party transactions
The Group has various related parties stemming from
relationships with limited partnerships managed by the Group, its
investment portfolio, its advisory arrangements (board seats) and
its key management personnel. In addition, the Company has related
parties in respect of its subsidiaries in the form of management
fees and expense recharges.
The Group may require that one of its members be appointed to
the board of a portfolio company in a non-executive role. In
certain cases, an administration fee is charged to the portfolio
company for the provision of director services. At times, expenses
incurred relating to director services can be recharged to
portfolio companies. These are immaterial.
During the prior year ending 31 March 2021, a loan was repaid
along with accrued interest (GBP3.7 million loaned as well as
GBP0.4 million of accrued interest) from Esprit Capital I Fund No.1
& No.2 LP to the Company. No movements related to this loan
occurred in the current period.
For the period ending 30 September 2021, management fees of
GBP5.4 million from related parties (the unconsolidated structured
entities described below) are included in the condensed
consolidated interim statement of comprehensive income (6-month
period to 30 September 2020: GBP4.6 million, year to 31 March 2021:
GBP9.2million). Total management fees for the period also included
GBP4.5 million from the EIS/VCT funds (6-month period to 30
September 2020: GBP1.5 million).
The EIS funds also paid Encore Ventures LLP performance fees of
GBP1.7 million for Encore Ventures LLP to pay onwards in line with
the Performance Fee Deeds executed in July and September 2015.
During the period, ending 30 September 2021, carry payments to
key management personnel of GBP0.3 million were made (6-month
period to 30 September 2020: GBPNil) by the Esprit Capital III LP
carry partner, Esprit Capital III Carried Interest LP. A cash
payment of GBP0.4 million was also made to Esprit Capital I (GP)
Limited in respect of carried interest by Esprit Capital III
Founder LP.
During the period, employees of Molten Ventures plc, including
key management personnel, were granted and exercised share options
- see Note 15 for further details.
Key management personnel compensation
Key management personnel are those persons having authority and
responsibility for planning, directing and controlling the
activities of the Group, and are considered to be the Directors of
the Company.
Period ending 30 Sep 2021 Period ending 30 Sep 2020
GBP'm GBP'm
------------------------------------------------ ------------------------- -------------------------
Wages and salaries 1.9 1.1
Short-term non-monetary benefits - -
Defined contribution pension costs 0.1 0.1
Share-based payment expense - -
Social security contributions and similar taxes 0.3 0.2
Carried interest paid 0.3 -
Total 2.6 1.4
------------------------------------------------ ------------------------- -------------------------
Unconsolidated structured entities
The Group has exposure to a number of unconsolidated structured
entities as a result of its venture capital investment
activities.
The Group ultimately invests all funds via a number of limited
partnerships and some via Molten Ventures plc's wholly owned
subsidiary, Molten Ventures (Ireland) Limited (formerly Draper
Esprit (Ireland) Limited). These are controlled by the Group and
not consolidated, but they are held as investments at fair value
through profit and loss on the consolidated balance sheet in line
with IFRS 10 (see Note 3(b) of the Company's Annual Report and
Accounts for the year ended 31 March 2021 for further details and
for the list of these investment companies and limited
partnerships). The material assets and liabilities within these
investment companies are the investments, which are held at FVTPL
in the consolidated accounts. Please see further details in the
table below.
30 Sep 2021 31 Mar 2021
Name of undertaking Registered office Activity Holding Country GBP'm GBPm
------------------------- ------------------------- -------------------- ------- ------- ----------- -----------
Esprit Investments (1) 20 Garrick Street,
(B) LP London, WC2E 9BT Limited Partnership 100% England 18.1 12.0
Esprit Investments (2) 20 Garrick Street,
(B) LP London, WC2E 9BT Limited Partnership 100% England 266.9 157.6
Molten Ventures (Ireland) 32 Molesworth Street,
Limited Dublin 2, Ireland Investment company 100% Ireland 920.5 670.6
------------------------- ------------------------- -------------------- ------- ------- ----------- -----------
Molten Ventures (Ireland) Limited invests via the following
limited partnerships: Esprit Investments (1) LP, Esprit Investments
(2) LP, Esprit Capital IV LP, Esprit Capital III LP.
The investments balance in the condensed consolidated interim
statement of financial position also includes investments held by
consolidated entities.
The Group also co-invests or historically co-invested with a
number of limited partnerships (see Note 3(b) of the Company's
Annual Report and Accounts for the year ended 31 March 2021 for
further details). The exposure to these entities is immaterial.
21. Capital commitments
The Group has made commitments to seed funds as part of its
investment activity. At 30 September 2021, the Group was committed
to approximately GBP89.6 million (translated at period end rates)
(31 March 2021: GBP67.2 million) in relation to investments in Fund
of Funds vehicles, of which GBP38.8 million of this has been drawn
at 30 September 2021 (31 March 2021: GBP25.5 million).
The Group has also made commitments to a number of Earlybird
funds. These commitments total GBP155.6 million (31 March 2021:
GBP151.8 million), with undrawn commitments across all Earlybird
entities of GBP21.7 million (translated at period end exchange
rates) (31 March 2021: GBP26.5 million). Total exposure to
Earlybird for the Group is GBP304.5 million of investments (31
March 2021: GBP287.0 million).
22. Ultimate controlling party
The Directors of Molten Ventures plc do not consider there to be
a single ultimate controlling party of the Group.
23. Alternative Performance Measures ("APM")
The Group has included the APMs listed below in this report as
they highlight key value drivers for the Group and, as such, have
been deemed by the Group's management to provide useful additional
information to readers of this report. These measures are not
defined by IFRS and should be considered in addition to IFRS
measures.
Gross Portfolio Value
The GPV is the gross fair value of the Group's investment
holdings before deductions for the fair value of carry liabilities
and any deferred tax. The GPV is subject to deductions for the fair
value of carry liabilities and deferred tax to generate the net
investment value, which is reflected on the consolidated statement
of financial position as financial assets held at FVTPL. Please see
the financial review for a reconciliation to the net investment
balance. This table also shows the Gross to Net movement, which is
91% in the current year calculated as the net investment value
divided by the GPV. The table reflects a Gross fair value movement
of GBP268.9 million, which is 27 % as a percentage of the 31 March
2021 GPV, which is described in the report as the Gross fair value
increase.
NAV per share
The NAV per share is the Group's net assets attributable to
shareholders divided by the number of shares at the relevant
reporting date. See the calculation in Note 8.
24. Exceptional items
Exceptional costs were recognised in the six-month period to 30
September 2021 relating to the Company's Main Market Move of GBP2.4
million (30 September 2020: GBPNil). The majority of these costs
include fees relating to brokers, legal advisory, listing,
reporting accountant, NED recruitment, remuneration advisory, IT
consultancy, and PR services.
25. Subsequent events
Post period-end, we have deployed GBP36.6 million in investments
including an investment in Satellite Vu, a British start-up using
satellite technology to determine valuable insights into economic
activity, energy efficiency and carbon footprint.
We have realised cash proceeds of GBP26.1 million post
period-end, as a result of further Trustpilot and UiPath share
sales.
There are no further post balance sheet events requiring
comment.
Glossary
In this document, where the context permits, the expressions set
out below shall bear the following meaning:
"Admission" the Admission of the enlarged share capital to trading
or "IPO" on AIM and Euronext Growth (formerly the Enterprise
Securities Market operated and regulated by the Irish
Stock Exchange) on 15 June 2016 and such admission
becoming effective in accordance with the AIM Rules
and the Euronext Growth Rules respectively. The IPO
included the acquisition of Esprit Capital Partners
LLP and Molten Ventures (Ireland) Limited (formerly
Draper Esprit (Ireland) Limited).
------------------------- -----------------------------------------------------------------
"Act" the UK Companies Act 2006.
------------------------- -----------------------------------------------------------------
"AIM" AIM, the market of that name operated by the London
Stock Exchange.
------------------------- -----------------------------------------------------------------
"Audit, Risk the Audit, Risk and Valuations Committee of the Board.
and Valuations
Committee"
------------------------- -----------------------------------------------------------------
"AUM" assets under management.
------------------------- -----------------------------------------------------------------
"BoE" Bank of England.
------------------------- -----------------------------------------------------------------
"BVCA" British Private Equity & Venture Capital Association.
------------------------- -----------------------------------------------------------------
"Carry Liabilities" Carried interest liabilities relating to the vested
and unvested carried interest due on the Gross Portfolio.
------------------------- -----------------------------------------------------------------
"Chapter 15 A closed-ended investment fund applying for, or with,
Company" a premium listing.
------------------------- -----------------------------------------------------------------
"Company" or Molten Ventures plc (formerly Draper Esprit plc), a
"Molten Ventures" company incorporated in England and Wales with registered
or "Plc" number 09799594 and having its registered office at
20 Garrick Street, London, WC2E 9BT.
------------------------- -----------------------------------------------------------------
"Core Portfolio" the top companies by value that represent approximately
or "Core Portfolio 70% of the overall portfolio value.
Companies"
------------------------- -----------------------------------------------------------------
"COVID-19" Coronavirus disease, the infectious disease caused
by a new strain of coronavirus in 2019/20.
------------------------- -----------------------------------------------------------------
"DEF" or "Digital Digital East Fund 2013 SCA SICAR
East Fund"
------------------------- -----------------------------------------------------------------
"Directors" the Directors of the Company from time to time.
or "Board"
------------------------- -----------------------------------------------------------------
"EB IV" / "Earlybird Earlybird GmbH & Co. Beteiligungs-KG IV
Fund IV"
------------------------- -----------------------------------------------------------------
"EB VI" / "Earlybird Earlybird DWES Fund VI GmbH & Co. KG
Fund VI"
------------------------- -----------------------------------------------------------------
"EB VII" / "Earlybird Earlybird DWES Fund VII GmbH & Co. KG
Fund VII"
------------------------- -----------------------------------------------------------------
"EIS" the EIS funds managed by Encore Ventures LLP. EIS funds
being Enterprise Investment Scheme under the provisions
of Part 5 of the Income Tax Act 2007.
------------------------- -----------------------------------------------------------------
"Elderstreet" Elderstreet Investments Limited, a private company
limited by shares incorporated in England and Wales
under registration number 01825358 with its registered
office at 20 Garrick Street, London, WC2E 9BT.
------------------------- -----------------------------------------------------------------
"Encore Funds" DFJ Esprit Angels' EIS Co-Investment Fund, DFJ Esprit
/ "EIS funds" Angels' EIS Co-Investment II, DFJ Esprit EIS III, DFJ
Esprit EIS IV, Draper Esprit EIS 5, and Draper Esprit
EIS, and each an "Encore Fund". Draper Esprit EIS will
shortly be rebranded to Molten Ventures EIS.
------------------------- -----------------------------------------------------------------
"Encore Ventures" Encore Ventures LLP, a limited liability partnership
incorporated in England and Wales under the registration
number OC347590 with its registered office at 20 Garrick
Street, London, WC2E 9BT.
------------------------- -----------------------------------------------------------------
"ESG" Environmental, Social and Governance.
------------------------- -----------------------------------------------------------------
"Esprit Capital" Esprit Capital Partners LLP (formerly known as Draper
/ "ECP" Esprit LLP), a limited liability partnership incorporated
in England and Wales under the registration number
OC318087 with its registered office at 20 Garrick Street,
London, WC2E 9BT.
------------------------- -----------------------------------------------------------------
"Euronext Dublin" the trading name of the Irish Stock Exchange Plc.
------------------------- -----------------------------------------------------------------
"Euronext Growth" the Euronext Growth securities market (formerly the
Enterprise Securities Market) operated and regulated
by the Irish Stock Exchange Plc (trading as "Euronext
Dublin").
------------------------- -----------------------------------------------------------------
"Exclusion list" the Group's exclusion list setting out the sectors,
businesses and activities in which the Group will not
invest due to having as their objective or direct impact
any of the following: 1. Slavery, human trafficking,
forced or compulsory labour, or unlawful / harmful
child labour. 2. Production or sale of illegal or banned
products, or involvement in illegal activities. 3.
Activities that compromise endangered or protected
wildlife or wildlife products. 4. Production or sale
of hazardous chemicals, pesticides and wastes. 5. Mining
of fossil fuels. 6. Manufacture, distribution or sale
of arms or ammunitions which are not systems or
services generally regarded as having defensive / non-offensive
objectives as their core focus. 7. Manufacture of,
or trade in, tobacco or alcohol. 8. Manufacture or
sale of pornography. 9. Trade in human body parts or
organs. 10. Animal testing other than for the satisfaction
of medical regulatory requirements. 11. Production
or other trade related to unbonded asbestos fibres.
------------------------- -----------------------------------------------------------------
"FCA" the UK Financial Conduct Authority.
------------------------- -----------------------------------------------------------------
"Fund of Funds" seed fund LPs invested in by the Group
------------------------- -----------------------------------------------------------------
"Gross Portfolio the increase in the fair value of the portfolio of
fair value growth" investee companies held by funds controlled by the
Company before accounting for deferred tax, external
carried interest and amounts co-invested.
------------------------- -----------------------------------------------------------------
"Gross Portfolio Gross Portfolio Value is the value of the portfolio
Value" of investee companies held by funds controlled by the
Company before accounting for deferred tax, external
carried interest and amounts co-invested.
------------------------- -----------------------------------------------------------------
"Group" the Company and its subsidiaries from time to time
and, for the purposes of this document, including Esprit
Capital LLP and its subsidiaries and subsidiary undertakings.
------------------------- -----------------------------------------------------------------
"Growth Opportunities Earlybird Growth Opportunities Fund I GmbH & Co. KG
fund"
------------------------- -----------------------------------------------------------------
"HMRC" HM Revenue & Customs.
------------------------- -----------------------------------------------------------------
"IFRS" or "IFRSs" International accounting standards in conformity with
the requirements of the Companies Act 2006.
------------------------- -----------------------------------------------------------------
"IPO" Initial Public Offering.
------------------------- -----------------------------------------------------------------
"International the International Private Equity and Venture Capital
Private Equity Valuation Guidelines, as amended from time to time.
and Venture
Capital Valuation
Guidelines"
/ "IPEV Guidelines"
------------------------- -----------------------------------------------------------------
"IRR" the internal rate of return.
------------------------- -----------------------------------------------------------------
"Main Market Molten Ventures plc's (formerly Draper Esprit plc)
move" admission to the premium listing segment of the Official
List of the Financial Conduct Authority and the secondary
listing segment of the Official List of the Irish Stock
Exchange plc, trading as Euronext Dublin and to trading
on the London Stock Exchange plc's main market for
listed securities and the regulated market of Euronext
Dublin.
------------------------- -----------------------------------------------------------------
"Main Market" the London Stock Exchange plc's main market for listed
securities and the regulated market of Euronext Dublin.
------------------------- -----------------------------------------------------------------
"NAV" / "Net the value, as at any date, of the assets of the Company
Asset Value" and/or Group after deduction of all liabilities determined
in accordance with the accounting policies adopted
by the Company and/or Group from time to time.
------------------------- -----------------------------------------------------------------
"Net Portfolio the value of the portfolio of investee companies held
Value" by funds controlled by the Company after accounting
for deferred tax, external carried interest and amounts
co-invested and recognised on the statement of financial
position
------------------------- -----------------------------------------------------------------
"Ordinary Shares" ordinary shares of GBP0.01 pence each in the capital
of the Company.
------------------------- -----------------------------------------------------------------
"PricewaterhouseCoopers" PricewaterhouseCoopers LLP, a limited liability partnership
or "PwC" registered in England and Wales with registered number
OC303525 and having its registered office at 7 More
London Riverside, London, SE1 2RT.
------------------------- -----------------------------------------------------------------
"SECR" Streamlined Energy and Carbon Reporting.
------------------------- -----------------------------------------------------------------
"SM&CR" the Senior Managers and Certification Regime.
------------------------- -----------------------------------------------------------------
"SVB" Silicon Valley Bank.
------------------------- -----------------------------------------------------------------
"TCFD" Task Force on Climate-Related Financial Disclosures
------------------------- -----------------------------------------------------------------
"VC" venture capital.
------------------------- -----------------------------------------------------------------
"VCT" / "VCT the VCT funds of Draper Esprit VCT plc (Co. Reg. No.03424984),
funds" under the management of Elderstreet. VCT being Venture
Capital Trusts under the provisions of part 6 of the
Income Tax Act 2007. Draper Esprit VCT plc will shortly
be rebranded to Molten Ventures VCT plc.
------------------------- -----------------------------------------------------------------
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END
IR FLFITLSLRFIL
(END) Dow Jones Newswires
November 29, 2021 02:00 ET (07:00 GMT)
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