TIDMPGOO 
 
 
   PROVEN GROWTH AND INCOME VCT PLC 
 
   Half-yearly report 
 
   For the six months ended 31 August 2020 
 
   Financial Summary 
 
 
 
 
                                                          31       31        29 
                                                        August   August   February 
                                                         2020     2019      2020 
------------------------------------------------------  -------  -------  -------- 
Net asset value per share ("NAV")                       55.30p    63.2p    58.6p 
------------------------------------------------------  -------  -------  -------- 
Dividends paid since class launch (Originally as 'C' 
 Shares)                                                66.15p    62.9p    64.4p 
------------------------------------------------------  -------  -------  -------- 
Total return (NAV plus dividends paid since 'C' Share 
 class launch)                                          121.45p  126.1p    123.0p 
------------------------------------------------------  -------  -------  -------- 
Net Assets (GBP'000)                                    123,918  118,881   117,234 
------------------------------------------------------  -------  -------  -------- 
 
 
   Chairman's Statement 
 
   Introduction 
 
   I have pleasure in presenting the half year report for ProVen Growth and 
Income VCT plc (the "Company") for the six months ended 31 August 2020. 
 
   Net asset value 
 
   During the six-month period, the net asset value ("NAV") per share 
decreased from 58.6p to 55.3p at 31August 2020. This decrease of 3.3p is 
largely reflective of the final dividend of 1.75p for the year ended 
29February 2020 paid on 28 August 2020, but also the overall loss in the 
period. The loss is a result of the standard running costs of the 
Company and an overall decrease in valuation of the portfolio. 
 
   The Company released a NAV on 23 March 2020 of 54.6 pence per share to 
reflect the initial impact of the Coronavirus pandemic on valuations. 
The Company has shown signs of recovery, however, with a NAV of 56.2p 
per share as at 31 May and a further increase in value since then of 
0.85 pence per share before taking into account the final dividend of 
1.75p paid in the period. 
 
   Portfolio activity and valuation 
 
   At 31 August 2020, the Company's investment portfolio comprised 49 
investments at a valuation of GBP82.6 million. 
 
   During the six-month period, the Company invested GBP4.35million into 
three new companies: 
 
   -- Commonplace (GBP1.5 million) -- a B2B software company that has 
developed a digital community engagement platform enabling developers, 
local authorities, transport planners, infrastructure developers and 
other large project owners to engage with local communities; 
 
   -- Luxury Promise (GBP1.35 million) -- a platform to buy and sell 
pre-owned luxury women's handbags and accessories; and 
 
   -- Social Value Portal (GBP1.5 million) --provides a platform for 
organisations to quantify the 'social value' they themselves or their 
supply chain create. 
 
   The Company also continued to support the current portfolio during the 
period and made follow on investments into Fnatic (GBP0.8million), 
Thread (GBP0.4million) and Contactengine (GBP0.125 million). 
 
   The investment portfolio showed an overall unrealised loss of GBP873,000 
compared to the valuation as at 29 February 2020. The valuation saw a 
large decrease in value as a result of the initial impact of the 
Coronavirus pandemic. This was reflected in the NAV announced on 23 
March 2020 of 54.6 pence per share. Since then the portfolio has shown 
good overall recovery from the downturn in valuations to pre-Covid 
levels. 
 
   There were valuation uplifts across the portfolio in the six months 
since 29 February 2020 with Smart Assistant and My 1st Years, in 
particular, having significant increases of GBP1.6 million and GBP1.4 
million respectively. There are companies, however, where the impact of 
the Coronavirus pandemic is having a longer-term adverse effect such as 
D3O and Sealskinz which have seen decreases in valuation of GBP1.8 
million and GBP1.6 million respectively. 
 
   A summary of the top 20 venture capital investments, by value, is 
provided in the Summary of Investment Portfolio. 
 
   Post period end portfolio activity 
 
   Since 31 August 2020, the Company has continued to support the current 
portfolio by making follow-on investments into Thread (GBP0.25 million), 
Papier (GBP0.31 million), POQ Studio (GBP0.15 million) and DeepCrawl 
(net investment of GBP1.5 million after part disposal proceeds 
received). 
 
   Results and dividends 
 
   The total loss on ordinary activities for the six-month period to 31 
August 2020 was GBP2,641,000. 
 
   During the six-month period, a final dividend of 1.75p per share in 
respect of the year ended 29 February 2020 was paid on 28 August 2020 to 
Shareholders on the register at 7 August 2020 following Shareholder 
approval at the Company's AGM. 
 
   The Board has declared an interim dividend of 1.5p per share which will 
be paid on 4 December 2020 to Shareholders on the register at 13 
November 2020. The dividend represents a cash return of 2.6% on the 
opening NAV per share at 1 March 2020, adjusted for the August dividend 
of 1.75p per share. The payment of this interim dividend will result in 
an equivalent reduction in the Company's NAV per share. 
 
   Shareholders are reminded that the Company operates a Dividend 
Reinvestment Scheme ("DRIS") for shareholders who wish to have their 
dividends reinvested in new shares and obtain further income tax relief 
on those shares, subject to the usual restrictions. If you are not 
currently registered for the DRIS and wish to have your dividends paid 
in the form of new shares, DRIS forms are available from the 
www.provenvcts.co.uk website or by contacting Beringea on 020 7845 7820. 
Shareholders will need to be registered for the DRIS prior to 7 November 
2020 to be eligible to receive the forthcoming dividend as new shares. 
 
   Fund raising and share issues 
 
   As detailed in the annual report and accounts, the Company launched a 
combined offer for subscription with ProVen VCT plc on 27 January 2020 
to raise up to a total of GBP10 million per company, with an 
overallotment facility of up to a further GBP10 million per company. The 
offer closed to new applications on 10 March 2020 with GBP14.2 million 
of gross proceeds for the Company. 
 
   During the period, the Company allotted 24,518,370 shares at an average 
price of 57.9p per share under the Company's offer for subscription. In 
the same period, the Company allotted a further 1,102,624 shares at 
54.45p per share under the Company's DRIS in respect of the dividend 
paid on 28 August 2020. 
 
   The Company announced on 7 September 2020 the intention to launch a 
combined offer for subscription to raise up to a total of GBP20 million 
in each company together with an over-allotment facility of up to a 
further GBP10 million in each company. A Prospectus with full details of 
the proposed offer will be published shortly. 
 
   Share buybacks 
 
   The Company continues to operate a policy of purchasing its own shares 
as they become available in the market at a discount of approximately 5% 
to the latest published NAV. 
 
   During the period, the Company completed purchases of 1,871,415 shares 
at an average price of 52.9p per share and for aggregate consideration 
(net of costs) of GBP989,395. This represented 0.9% of the shares in 
issue at the start of the period. The shares were subsequently 
cancelled. 
 
   Outlook 
 
   The pandemic has created commercial disruption and financial challenges 
for many businesses in the portfolio, although some companies have been 
beneficiaries of increases in demand for their products. however, the 
Investment Manager has ensured that portfolio companies are supported as 
they adapt to the turbulent context of the pandemic. 
 
   The ongoing impact of the pandemic and the UK's departure from the 
European Union will create further challenges. Nonetheless, your Board 
remains optimistic that the companies in the portfolio can continue to 
adapt and grow in the coming months. 
 
   We also believe that there continue to be market opportunities for 
early-stage businesses, which often demonstrate the agility and 
innovation to adapt during a downturn. In particular, the pandemic has 
created a shift towards the digital economy, creating opportunities for 
technology-enabled companies in the portfolio and the pipeline of 
potential investments. The Manager, therefore, continues to seek 
investment opportunities in these areas, with three new additions to the 
portfolio in the period to 31August and has a strong flow of new 
investment opportunities looking further ahead. 
 
   The Company is well positioned to harness this healthy pipeline, given 
the recent successful fundraising. We do, however, anticipate that 
disposal activity will be subdued until there is more clarity about 
overall prospects for the economy. 
 
   Marc Vlessing OBE 
 
   Chairman 
 
   29 October 2020 
 
   Summary of Investment portfolio 
 
   as at 31 August 2020 
 
 
 
 
                                                        Valuation 
                                                        movement           % of 
                               Cost       Valuation     in period        portfolio 
                              GBP'000      GBP'000       GBP'000         by value 
----------------------  -------------  ------------  ------------  --------------- 
  Top twenty venture 
  capital investments 
  (by value) 
 
Sannpa Limited (t/a 
 Fnatic)                        6,718         6,904           186             5.6% 
ContactEngine Limited           2,454         5,355           137             4.3% 
Zoovu Limited (t/a 
 Smart Assistant)               2,455         5,197         1,631             4.2% 
Mycs Gmbh                       3,031         5,039           936             4.1% 
Dryden Holdings 
 Limited                        5,000         4,761             -             3.8% 
Infinity Reliance 
 Limited (t/a My 1st 
 Years)                         2,769         4,526         1,401             3.7% 
Thread, Inc.                    3,730         3,722             -             3.0% 
Papier Ltd                      3,150         3,150             -             2.5% 
Written Byte Ltd (t/a 
 DeepCrawl)                     1,612         2,922         (255)             2.4% 
Our Path Ltd (t/a 
 Second Nature)                 2,800         2,800             -             2.3% 
MPB Group Limited               1,489         2,784           936             2.2% 
Arctic Shores Limited           2,450         2,450             -             2.0% 
Commonplace Digital 
 Ltd                            1,500         2,072           572             1.7% 
Response Tap Limited            1,440         1,928         (669)             1.6% 
Picasso Labs, Inc.              1,470         1,813           343             1.5% 
Been There Done That 
 Global Limited                 1,448         1,752         (291)             1.4% 
Blis Media Limited              1,083         1,726           179             1.4% 
Aistemos Limited                1,681         1,679             -             1.4% 
Litchfield Media 
 Limited                        1,420         1,638            24             1.3% 
Disposable Cubicle 
 Curtains Limited (t/a 
 Hygenica)                      3,286         1,615           415             1.3% 
Other venture capital 
 investments                   38,915        18,725       (6,418)            14.9% 
----------------------  -------------  ------------  ------------  --------------- 
Total venture capital 
 investments                   89,901        82,558         (873)            66.6% 
----------------------  -------------  ------------  ------------  --------------- 
Cash at bank and in 
 hand                                        41,350                          33.4% 
----------------------  -------------  ------------  ------------  --------------- 
Total investments                           123,908                         100.0% 
----------------------  -------------  ------------  ------------  --------------- 
 
 
   Other venture capital investments at 31 August 2020 comprise: Access 
Systems, Inc., Buckingham Gate Financial Services Limited, Cogora Group 
Limited, Deltadot Limited, Duncannon Holdings Limited, D3O Holdings 
Limited, Exonar Limited, Firefly Learning Limited, Festicket Ltd, 
Iridium Topco Limited (formerly honeycomb.TV Limited), InContext 
Solutions, Inc., Inskin Media Limited, Lantum Limited, Lupa Foods 
Limited (formerly Donatantonio Limited),  Luxury Promise Limited, Monica 
Vinader Limited, Netcall plc, Poq Studio Ltd, Rapid Charge Grid Limited, 
Sealskinz Holdings Limited, Senselogix Limited, Simplestream Limited, 
Skills Matter Limited, Social Value Portal Ltd, Stylescape Limited (t/a 
EDITED), TVPlayer Limited, Utility exchange Online Limited, Vigilant 
Applications Limited and Whistle Sports, Inc. 
 
   With the exception of Netcall plc which is quoted on AIM, all venture 
capital investments are unquoted. 
 
   All of the above investments, with the exception of Duncannon Holdings 
Limited and Dryden Holdings Limited were also held by ProVen VCT plc, of 
which Beringea LLP is the investment manager. 
 
   All venture capital investments are registered in England and Wales 
except for InContext Solutions, Inc., Picasso Labs, Inc., Thread, Inc. 
and Whistle Sports, Inc. which are Delaware registered corporations in 
the United States of America, and Mycs Gmbh, which is registered in 
Germany. 
 
   Summary of investment movements 
 
   for the six months ended 31 August 2020 
 
   Investment activity during the six months ended 31 August 2020 is 
summarised as follows: 
 
 
 
 
Additions                      Cost 
                              GBP'000 
Commonplace Digital Ltd         1,500 
Social Value Portal Ltd         1,500 
Luxury Promise Limited          1,350 
Sannpa Limited (t/a Fnatic)       771 
Thread, Inc.                      421 
ContactEngine Limited             125 
Total                           5,667 
                              ------- 
 
 
 
 
 
 
                        Market value                Gain/ (loss)    Realised 
                         at 1 March     Disposal      against       gain in 
Disposals       Cost        2019        proceeds        cost         period 
               GBP'000    GBP'000       GBP'000       GBP'000       GBP'000 
Chargemaster 
 plc                 -             -            72            72            72 
MEL Topco 
 Limited (t/a 
 Maplin)             -             -             4             4             4 
 
Total                -             -            76            76            76 
               -------  ------------  ------------  ------------  ------------ 
 
 
   Of the disposals above, Chargemaster plc was realised in a prior period, 
but proceeds were recognised in the current period in excess of the 
amounts previously accrued. 
 
   The proceeds received in respect of MeL Topco Limited (t/a Maplin) 
reflect a final distribution in respect of the company's administration 
in excess of  the amounts previously accrued. 
 
   The total disposal proceeds outlined above do not match those recorded 
in the statement of cash flows as the cashflow figure represents total 
disposal proceeds received in cash in the six-month period to 31 August 
2020, elements of which will have been accrued in prior periods. 
 
   Unaudited Condensed Income Statement 
 
   for the six months ended 31 August 2020 
 
 
 
 
                                     (unaudited)                (unaudited) 
                                   Six months ended           Six months ended             (audited) 
                                     31 Aug 2020                31 Aug 2019          Year ended 29 Feb 2020 
                              Revenue  Capital   Total   Revenue  Capital   Total            Total 
                              GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000          GBP'000 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Income                          (109)        -    (109)      179        -      179                      430 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Realised gains on 
 investments                        -       76       76        -      337      337                      325 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Unrealised gains/ (losses) 
 on investments                     -    (873)    (873)        -  (4,859)  (4,859)                 (10,082) 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Investment management fee       (304)    (912)  (1,216)    (305)    (916)  (1,221)                  (2,430) 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Performance incentive fee           -        -        -        -        -        -                        - 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Other expenses                  (471)      (4)    (475)    (292)      (1)    (293)                    (587) 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
FX Translation                      -     (44)     (44)        -        -        -                       30 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Loss on ordinary activities 
 before taxation                (884)  (1,757)  (2,641)    (418)  (5,439)  (5,857)                 (12,314) 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Tax on ordinary activities          -        -        -        -        -        -                        - 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Loss attributable to equity 
 shareholders                   (884)  (1,757)  (2,641)    (418)  (5,439)  (5,857)                 (12,314) 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
 
Basic and diluted loss per 
 share                         (0.4p)   (0.9p)   (1.3p)   (0.2p)   (3.1p)   (3.3p)                   (6.6p) 
----------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
 
 
   All revenue and capital items in the above statement derive from 
continuing operations. The total column within this statement represents 
the Unaudited Condensed Income Statement of the Company. 
 
   The loss of GBP109,000 recognised as income is the result of a provision 
made against income which had been recognised in a prior period. 
 
   The Company has no recognised gains or losses other than the results for 
the six-month period as set out above. 
 
   The accompanying notes form an integral part of this announcement. 
 
   Unaudited Condensed Statement of Financial Position 
 
   as at 31 August 2020 
 
 
 
 
                                              (unaudited)  (unaudited)  (audited) 
                                                 31 Aug       31 Aug      29 Feb 
                                                  2020         2019        2020 
                                                GBP'000      GBP'000     GBP'000 
 
Fixed assets 
Investments                                        82,558       74,142     77,763 
--------------------------------------------  -----------  -----------  --------- 
 
Current assets 
Debtors                                               514          944        829 
--------------------------------------------  -----------  -----------  --------- 
Cash at bank and in hand                           41,350       44,760     39,789 
--------------------------------------------  -----------  -----------  --------- 
                                                   41,864       45,704     40,618 
--------------------------------------------  -----------  -----------  --------- 
Creditors: amounts falling due within one 
 year                                               (504)        (965)    (1,147) 
--------------------------------------------  -----------  -----------  --------- 
 
Net current assets                                 41,360       44,739     39,471 
--------------------------------------------  -----------  -----------  --------- 
 
Net assets                                        123,918      118,881    117,234 
--------------------------------------------  -----------  -----------  --------- 
 
 
Capital and reserves 
Called up share capital                             3,624        3,044      3,239 
--------------------------------------------  -----------  -----------  --------- 
Capital redemption reserve                             88           32         58 
--------------------------------------------  -----------  -----------  --------- 
Share premium account                              55,152       31,852     40,766 
--------------------------------------------  -----------  -----------  --------- 
Special reserve                                    55,688       65,489     61,164 
--------------------------------------------  -----------  -----------  --------- 
Capital reserve - realised                         14,827       18,071     15,667 
--------------------------------------------  -----------  -----------  --------- 
Revaluation reserve                               (2,033)        2,583    (1,160) 
--------------------------------------------  -----------  -----------  --------- 
Revenue reserve                                   (3,428)      (2,190)    (2,500) 
--------------------------------------------  -----------  -----------  --------- 
 
Total equity shareholders' funds                  123,918      118,881    117,234 
--------------------------------------------  -----------  -----------  --------- 
 
Basic and diluted net asset value per share         55.3p        63.2p      58.6p 
--------------------------------------------  -----------  -----------  --------- 
 
 
 
 
   The accompanying notes form an integral part of this announcement. 
 
 
 
 
                               Called 
                                 up      Capital     Share 
Six months ended 31 Aug 2020    share   redemption  premium  Special        Capital        Revaluation  Revenue 
 (unaudited)                   capital   reserve    account  reserve   reserve - realised    reserve    reserve   Total 
                               GBP'000   GBP'000    GBP'000  GBP'000        GBP'000          GBP'000    GBP'000  GBP'000 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
At 1 March 2020                  3,239          58   40,766   61,164               15,667      (1,160)  (2,500)  117,234 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Issue of new shares                415           -   14,386    (576)                    -            -        -   14,225 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Total comprehensive income           -           -        -        -                (840)        (873)    (928)  (2,641) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Share buybacks and 
 cancellation                     (30)          30        -    (993)                    -            -        -    (993) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Dividends paid                       -           -        -  (3,907)                    -            -        -  (3,907) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
At 31 August 2020                3,624          88   55,152   55,688               14,827      (2,033)  (3,428)  123,918 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
 
 
 
   Unaudited Condensed Statement of Changes in Equity 
 
 
 
 
                               Called 
                                 up      Capital     Share 
Six months ended 31 Aug 2019    share   redemption  premium  Special        Capital        Revaluation  Revenue 
 (unaudited)                   capital   reserve    account  reserve   reserve - realised    reserve    reserve   Total 
                               GBP'000   GBP'000    GBP'000  GBP'000        GBP'000          GBP'000    GBP'000  GBP'000 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
At 1 March 2019                  2,331          19      946   70,856               19,050        7,043  (1,772)   98,473 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Issue of new shares                726           -   30,906  (1,149)                    -            -        -   30,483 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Total comprehensive income           -           -        -        -                (580)      (4,859)    (418)  (5,857) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Transfer of previously 
 unrealised gains now 
 realised                            -           -        -        -                (399)          399        -        - 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Share buybacks and 
 cancellation                     (13)          13        -    (540)                    -            -        -    (540) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Dividends paid                       -           -        -  (3,678)                    -            -        -  (3,678) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
At 31 August 2019                3,044          32   31,852   65,489               18,071        2,583  (2,190)  118,881 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
 
 
 
   The special reserve, capital reserve - realised and revenue reserve are 
distributable reserves. Reserves available for distribution therefore 
amount to GBP67,087,000 (2019: GBP81,370,000). 
 
   The accompanying notes form an integral part of this half-yearly report. 
 
   Unaudited Condensed Statement of Cash Flows 
 
   for the six months ended 31 August 2020 
 
 
 
 
                                                             (unaudited)  (unaudited)  (audited) 
                                                              Six months   Six months       Year 
                                                                ended        ended         ended 
                                                                31 Aug       31 Aug       29 Feb 
                                                                 2020         2019          2020 
                                                     Note      GBP'000      GBP'000     GBP'000 
---------------------------------------------------  -----   -----------  -----------  --------- 
Net cash used in operating activities                  A         (1,659)      (1,686)    (3,115) 
---------------------------------------------------  ------  -----------  -----------  --------- 
 
Cashflows from investing activities 
---------------------------------------------------  -----   -----------  -----------  --------- 
Purchase of investments                                          (5,667)     (16,300)   (25,616) 
-----------------------------------------------------------  -----------  -----------  --------- 
Sale of investments                                                  107          136        835 
-----------------------------------------------------------  -----------  -----------  --------- 
Net cash used in investing activities                            (5,560)     (16,164)   (24,781) 
-----------------------------------------------------------  -----------  -----------  --------- 
 
Cashflows from financing activities 
---------------------------------------------------  -----   -----------  -----------  --------- 
Proceeds from share issues                                        14,200       31,077     39,735 
-----------------------------------------------------------  -----------  -----------  --------- 
Share issue costs                                                  (577)      (1,151)    (1,539) 
-----------------------------------------------------------  -----------  -----------  --------- 
Purchase of own shares                                           (1,537)        (574)    (1,230) 
-----------------------------------------------------------  -----------  -----------  --------- 
Equity dividends paid                                            (3,306)      (3,122)    (5,661) 
-----------------------------------------------------------  -----------  -----------  --------- 
Net cash from financing                                            8,780       26,230     31,305 
-----------------------------------------------------------  -----------  -----------  --------- 
 
Increase in cash and cash equivalents                  B           1,561        8,380      3,409 
---------------------------------------------------  ------  -----------  -----------  --------- 
 
Notes to the cash flow statement: 
A Cash flow from operating activities 
Loss on ordinary activities before taxation                      (2,641)      (5,857)   (12,314) 
-----------------------------------------------------------  -----------  -----------  --------- 
Loss on investments                                                  797        4,522      9,757 
-----------------------------------------------------------  -----------  -----------  --------- 
Decrease/(increase) in prepayments, accrued income 
 and other debtors                                                   285        (194)      (318) 
-----------------------------------------------------------  -----------  -----------  --------- 
Decrease in accruals and other creditors                           (100)        (157)      (240) 
-----------------------------------------------------------  -----------  -----------  --------- 
Net cash used in operating activities                            (1,659)      (1,686)    (3,115) 
-----------------------------------------------------------  -----------  -----------  --------- 
 
B Analysis of net funds 
Beginning of period /year                                         39,789       36,380     36,380 
-----------------------------------------------------------  -----------  -----------  --------- 
Net cash inflows                                                   1,561        8,380      3,409 
-----------------------------------------------------------  -----------  -----------  --------- 
End of period/ year                                               41,350       44,760     39,789 
-----------------------------------------------------------  -----------  -----------  --------- 
 
 
 
   The accompanying notes form an integral part of this announcement. 
 
   Notes to the half-yearly report 
 
   for the six months ended 31 August 2020 
 
   1.      Accounting policies 
 
   Basis of accounting 
 
   The Company has prepared its financial statements under Financial 
Reporting Standard 104 ("FRS104") and in accordance with the Statement 
of Recommended Practice 'Financial Statements of Investment Trust 
Companies and Venture Capital Trusts' (the "SORP") issued by the 
Association of Investment Companies ("AIC") in December 2018. 
 
   The following accounting policies have been applied consistently 
throughout the period. Further details of principal accounting policies 
were disclosed in the Annual Report and Accounts for the year ended 29 
February 2020. There has been no change to the accounting policies from 
those disclosed in the financial statements for the year ended 29 
February 2020. 
 
   The unaudited financial statements set out herein have not been subject 
to review by the auditor and do not constitute statutory accounts within 
the meaning of Section 434 of the Companies Act 2006. The figures for 
the year ended 29 February 2020 have been extracted from the financial 
statements for that period, which have been delivered to the Registrar 
of Companies; the Auditor's report on those financial statements was 
unqualified. 
 
   a)    Presentation of Income Statement 
 
   In order to better reflect the activities of an investment company and, 
in accordance with guidance issued by the AIC, supplementary information 
which analyses the Income Statement between items of a revenue and 
capital nature has been presented alongside the Income Statement. The 
revenue return attributable to equity shareholders is the measure the 
Directors believe appropriate in assessing the Company's compliance with 
certain requirements set out in Part 6 of the Income Tax Act 2007. 
 
   b)    Investments 
 
   Investments, including equity and loan stock, are recognised at their 
trade date and measured at "fair value through profit or loss" due to 
investments being managed and performance evaluated on a fair value 
basis.   A financial asset is designated within this category if it is 
both acquired and managed, with a view to selling after a period of time, 
in accordance with the Company's documented investment policy.  The fair 
value of an investment upon acquisition is deemed to be cost. 
Thereafter investments are measured at fair value in accordance with 
International Private Equity and Venture Capital Valuation Guidelines 
("IPEV Guidelines") issued in December 2018, together with Sections 11 
and 12 of FRS102. 
 
   Publicly traded investments are measured using bid prices in accordance 
with the IPEV Guidelines. 
 
   Key judgements 
 
   The valuation methodologies used by the Directors for estimating the 
fair value of unquoted investments are in accordance with the IPEV 
guidelines and as follows: 
 
 
   -- where a company is in the early stage of development, the estimate of 
      fair value is calculated based on market data and assumptions as to the 
      potential outcomes, benchmarked against alternative valuation 
      methodologies during this time; 
 
   -- where a company is well established after an appropriate period, the 
      investment may be valued by applying a suitable earnings or revenue 
      multiple to that company's maintainable earnings or revenue.  The 
      multiple used is based on comparable listed companies or a sector but 
      discounted to reflect factors such as the different sizes of the 
      comparable businesses, different growth rates and the lack of 
      marketability of unquoted shares; 
 
   -- where a value is indicated by a material arm's-length transaction by a 
      third party in the shares of the company, the valuation will normally be 
      based on this; 
 
   -- where alternative methods of valuation, such as net assets of the 
      business, are more appropriate then such methods may be used; and 
 
   -- where repayment of the equity is not probable, redemption premiums will 
      be recognised. 
 
 
   The methodology applied takes account of the nature, facts and 
circumstances of the individual investment and uses reasonable data, 
market inputs, assumptions and estimates in order to ascertain fair 
value.  Methodologies are applied consistently from year to year except 
where a change results in a better estimate of fair value. 
 
   Where an investee company has gone into receivership or liquidation, or 
the loss in value below cost is considered to be permanent, or there is 
little likelihood of a recovery from a company in administration, the 
loss on the investment, although not physically disposed of, is treated 
as being realised. 
 
   All investee companies are held as part of an investment portfolio and 
measured at fair value. Therefore, it is not the policy for investee 
companies to be consolidated and any gains or losses arising from 
changes in fair value are included in the Unaudited Condensed Income 
Statement for the period as a capital item. 
 
   Gains and losses arising from changes in fair value are included in the 
Unaudited Condensed Income Statement for the period as a capital item 
and transaction costs on acquisition or disposal of the investment are 
expensed. 
 
   Investments are derecognised when the contractual rights to the cash 
flows from the asset expire or the Company transfers the asset and 
substantially all the risks and rewards of ownership of the asset to 
another entity. 
 
   Key estimates 
 
   The key estimates involved in determining the fair value of a company 
can include: 
 
 
   -- identifying a relevant basket of market comparables; 
 
   -- deducing the discount to take on those market comparables; 
 
   -- determining reoccurring revenue; 
 
   -- determining reoccurring earnings; or 
 
   -- identifying surplus cash. 
 
 
   1. All revenue and capital items in the Unaudited Condensed Income Statement 
      derive from continuing operations. 
 
   2. There are no other items of comprehensive income other than those 
      disclosed in the Unaudited Condensed Income Statement. 
 
   3. The Company has only one operating segment as reported to the Board of 
      Directors in their capacity as chief operating decision makers and 
      derives its income from investments made in shares, securities and bank 
      deposits. 
 
   4. The comparative figures are in respect of the year ended 29 February 2020 
      and the six-month period ended 31 August 2019. 
 
   5. Basic and diluted return per share for the period has been calculated on 
      209,645,678 shares, being the weighted average number of shares in issue 
      during the period. 
 
   6. Basic and diluted NAV per share for the period has been calculated on 
      223,886,810 shares, being the number of shares in issue at the period 
      end. 
 
   7. Dividends 
 
 
 
 
                                           (unaudited)                                 (unaudited)         (audited) 
                                                                                                             Year 
                                         Six months ended                           Six months ended         ended 
                                                                                                            29 Feb 
                                           31 Aug 2019                                 31 Aug 2019           2020 
                         Revenue             Capital              Total         Revenue  Capital   Total     Total 
             Pence       GBP'000             GBP'000             GBP'000        GBP'000  GBP'000  GBP'000   GBP'000 
-----------  -----  ------------------  ------------------  ------------------  -------  -------  -------  --------- 
2019 Final     2.0                   -                   -                   -        -    3,678    3,678      3,678 
-----------  -----  ------------------  ------------------  ------------------  -------  -------  -------  --------- 
2020 
 Interim       1.5                   -                   -                   -        -        -        -      3,011 
-----------  -----  ------------------  ------------------  ------------------  -------  -------  -------  --------- 
2020 Final    1.75                   -               3,907               3,907        -        -        -          - 
-----------  -----  ------------------  ------------------  ------------------  -------  -------  -------  --------- 
Total 
 dividends 
 paid                                -               3,907               3,907        -    3,678    3,678      6,689 
-----------  -----  ------------------  ------------------  ------------------  -------  -------  -------  --------- 
 
 
   9.      Contingent liabilities, guarantees and financial commitments 
 
   Based on the NAV per share at 31 August 2020, before any performance fee 
accrual, and cumulative dividends paid and payable ahead of 28 February 
2021, no performance fee is currently payable. The performance fee 
structure contains certain restrictions to ensure that hurdles are met 
before the payment of a performance fee and to encourage the payment of 
tax-free dividends. After applying these restrictions, no accrual has 
been made for a performance fee at 31 August 2020. 
 
 
 
   A performance incentive fee, if any, will only be payable once the full 
year results have been finalised. 
 
 
 
   The Company has no contingent liabilities, guarantees or financial 
commitments at 31 August 2020. 
 
 
 
   10.   Called up share capital 
 
   During the period, the Company issued 24,518,370Ordinary Shares for an 
aggregate consideration of GBP14.2million under the combined o er for 
subscription with ProVen VCT plc which launched on 27 January 2020. 
Share issue costs thereon amounted to GBP577,000. 
 
 
 
   In the same period, the Company allotted a further 1,102,624 shares at 
54.45p per share under the Company's DRIS in respect of the dividend 
paid on 28 August 2020. 
 
 
 
   During the period, the Company completed purchases of 1,871,415 shares 
at an average price of 52.9p per share and for aggregate consideration 
(net of costs) of GBP989,395. This represented 0.94% of the shares in 
issue at the start of the period. The shares were subsequently 
cancelled. 
 
 
 
 
 
 
   1. Financial instruments 
 
   Investments are valued at fair value as determined using the measurement 
policies described in note 1. 
 
   The Company has categorised its financial instruments that are measured 
subsequent to initial recognition at 
 
   fair value, using the fair value hierarchy as follows: 
 
   Level 1     Reflects instruments quoted in an active market. 
 
   Level 2     Reflects financial instruments that have been valued using 
inputs, other than quoted prices, that are observable. 
 
   Level 3     Reflects financial instruments that have been valued using 
valuation techniques with unobservable inputs. 
 
 
 
 
 
 
                                    (unaudited)                                 (audited) 
                                     31 Aug 2020                               29 Feb 2020 
                   Level 1             Level 2        Level 3   Total   Level 1  Level 2  Level 3   Total 
                   GBP'000             GBP'000        GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000 
------------  ------------------  ------------------  -------  -------  -------  -------  -------  ------- 
AIM quoted                   214                   -        -      214      193        -        -      193 
------------  ------------------  ------------------  -------  -------  -------  -------  -------  ------- 
Loan notes                     -                   -   16,295   16,295        -        -   16,295   16,295 
------------  ------------------  ------------------  -------  -------  -------  -------  -------  ------- 
Unquoted 
 investments                   -                   -   66,049   66,049        -        -   61,275   61,275 
------------  ------------------  ------------------  -------  -------  -------  -------  -------  ------- 
Total                        214                   -   82,344   82,558      193        -   77,570   77,763 
------------  ------------------  ------------------  -------  -------  -------  -------  -------  ------- 
 
   There have been no transfers between the three levels outlined above. 
 
 
 
   12.   Controlling party and related party transactions 
 
   In the opinion of the Directors there is no immediate or ultimate 
controlling party. 
 
   Malcolm Moss, a Director of the Company, is also a Partner of Beringea 
LLP. Beringea LLP was the Company's Investment Manager during the 
period. During the six months ended 31 August 2020, GBP1,216,000 (2019: 
GBP1,221,000) was payable to Beringea LLP in respect of these services. 
At the period end the Company owed Beringea LLP GBPnil (2019: 
GBP219,000). 
 
   Beringea LLP was also the Company's Administration Manager during the 
period. Fees paid to Beringea in its capacity as Administration Manager 
for the six months ended 31 August 2020 amounted to GBP30,000 (2019: 
GBP27,000) of which GBPnil (2019: GBP14,000) remained outstanding at the 
period end. 
 
   As the Company's investment manager, Beringea LLP is also entitled to 
receive a performance incentive fee based on the Company's performance 
for each financial year to 28 February. The performance incentive fee 
arrangements are set out, in detail, in the Annual Report and Accounts. 
For the six-month period ended 31 August 2020, no performance incentive 
fee has been accrued. The actual performance incentive fee, if any, will 
only be payable once the full year results have been finalised. 
 
   Beringea LLP may charge arrangement fees, in line with industry practice, 
to companies in which it invests. It may also receive directors' fees or 
monitoring fees from investee companies. These costs are borne by the 
investee company not the Company. In the six-month period to 31 August 
2020, GBP309,000 (2019: GBP316,000) was payable to Beringea LLP for 
arrangement fees under such arrangements. Directors and monitoring fees 
payable to Beringea LLP in the six-month period to 31 August 2020 
amounted to GBP167,000 (2019: GBP253,000). 
 
   During the six months to 31 August 2020, an amount of GBP74,000 (2019: 
GBP60,000) was payable to the Directors of the Company as remuneration 
for services provided to the Company. No amount was outstanding at the 
period-end. 
 
 
   1. The Directors confirm that, to the best of their knowledge, the 
      half-yearly financial statements have been prepared in accordance with 
      Financial Reporting Standard 104 issued by the Financial Reporting 
      Council and the half-yearly financial report includes a fair review of 
      the information required by: 
 
   2. DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication 
      of important events that have occurred during the first six months of the 
      financial year and their impact on the condensed set of financial 
      statements, and a description of the principal risks and uncertainties 
      for the remaining six months of the year; and 
 
   3. DTR 4.2.8R of the Disclosure and Transparency Rules, being related party 
      transactions that have taken place in the first six months of the current 
      financial year and that have materially affected the financial position 
      or performance of the entity during that period, and any changes in the 
      related party transactions described in the last annual report that could 
      do so. 
 
   4. Risk and uncertainties 
 
          1. investment risk associated with investing in small and immature 
             businesses; 
 
          2. investment risk arising from volatile stock market conditions and 
             their potential effect on the value of the Company's venture 
             capital investments and the exit opportunity for those 
             investments; and 
 
          3. breach of VCT regulations. 
 
   Under the Disclosure and Transparency Directive, the Board is required 
in the Company's half-yearly results, to report on the principal risks 
and uncertainties facing the Company over the remainder of the financial 
year. 
 
   The Board has concluded that the key risks facing the Company over the 
remainder of the financial year are as follows: 
 
   In the case of (i), the Board is satisfied with the Company's approach. 
The Investment Manager follows a rigorous process in vetting and careful 
structuring of new investments and, after an investment is made, close 
monitoring of the business. In respect of (ii), the Company seeks to 
hold a diversified portfolio. However, the Company's ability to manage 
this risk is quite limited, primarily due to the restrictions arising 
from the VCT regulations. 
 
   The Company's compliance with the VCT regulations is continually 
monitored by the Administration Manager, who reports regularly to the 
Board on the current position. The Company also retains Philip Hare & 
Associates LLP to provide regular reviews and advice in this area. The 
Board considers that this approach reduces the risk of a breach of the 
VCT regulations to an appropriate level. 
 
   15.   Going concern 
 
   The Directors have reviewed the Company's financial resources at the 
period end and concluded that the Company is well placed to manage its 
business risks. 
 
   The Board confirms that it is satisfied that the Company has adequate 
resources to continue in business for the foreseeable future. For this 
reason, the Board believes that the Company continues to be a going 
concern and that it is appropriate to apply the going concern basis in 
preparing the financial statements. 
 
   Copies of the unaudited half yearly results will be sent to 
shareholders. Further copies can be obtained from the Company's 
registered office and will be available for download from 
https://www.globenewswire.com/Tracker?data=5U8LasP4k9trRd3E2mfNj0I9_YpngmvNDDt_GPiZj-KrWYY_OYjhfi8MaGzPIhxQRtCJ6JbItoAj7FUJ_Jl2HD50FqUufKDQr35m6isDR4Q= 
www.provenvcts.co.uk. 
 
   16.   Post balance sheet events 
 
   Since 31 August 2020, the Company has continued to support the current 
portfolio by making follow-on investments into Thread (GBP0.25 million), 
Papier (GBP0.31 million), POQ Studio (GBP0.15 million) and DeepCrawl 
(net investment of GBP1.5 million after part disposal proceeds 
received). 
 
 
 
 
 
 

(END) Dow Jones Newswires

October 29, 2020 12:57 ET (16:57 GMT)

Copyright (c) 2020 Dow Jones & Company, Inc.
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