TIDMPGOO 
 
 
   PROVEN GROWTH AND INCOME VCT PLC 
 
   Half-yearly report 
 
   For the six months ended 31 August 2019 
 
   Financial Summary 
 
 
 
 
                                                           31      31        28 
                                                       August  August  February 
                                                         2019    2018      2019 
-----------------------------------------------------  ------  ------  -------- 
Net asset value per share ("NAV")                       63.2p   74.3p     68.4p 
-----------------------------------------------------  ------  ------  -------- 
Dividends paid since class launch (Originally as 'C'    62.9p   56.4p     60.9p 
 Shares) 
-----------------------------------------------------  ------  ------  -------- 
Total return (NAV plus dividends paid since 'C' Share  126.1p  130.7p    129.3p 
 class launch) 
-----------------------------------------------------  ------  ------  -------- 
 
 
   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 2019. 
 
   Net asset value 
 
   During the six-month period, the net asset value ("NAV") per share 
decreased from 68.4p to 63.2p at 31 August 2019. The decrease of 5.2p 
comprised a 3.2p decrease largely from valuation movements plus the 
dividend of 2.0p for the year ended 28 February 2019 paid in July 2019. 
 
   Portfolio activity and valuation 
 
   During the six months to 31 August 2019, a total of GBP16.3 million was 
invested. This comprised GBP9.9 million into four new investments, 
Papier Ltd, Sannpa Limited (t/a Fnatic), Arctic Shores Limited and 
Picasso Labs, Inc., and GBP6.4 million into five existing portfolio 
companies to support their continued growth and development. 
 
   There was also one full disposal in the period, namely 7digital Group 
plc. This resulted in an overall loss of GBP400,000 against cost though 
fair valuation losses on the investment had largely been recognised in 
previous periods. The sale was a strategic decision seeing that, 
following recent developments in the company, the Company's shareholding 
would have soon become VCT non-qualifying. 
 
   The venture capital investment portfolio showed disappointing net 
unrealised losses for the six-month period of GBP4.9 million. This 
equates to an approximate 7.7% decrease in valuation on the portfolio 
position at 28 February 2019 and reflects a more cautious outlook on 
several portfolio companies. 
 
   Results and dividends 
 
   The total loss on ordinary activities after taxation for the six-month 
period to 31 August 2019 was GBP5.9 million. 
 
   During the six-month period, a final dividend of 2.0p per share in 
respect of the year ended 28 February 2019 was paid on 19 July 2019 to 
Shareholders on the register at 21 June 2019 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 6 December 2019 to shareholders on the register at 15 
November 2019. The dividend represents a cash return of 2.3% on the 
opening NAV per share at 1 March 2019, adjusted for the July dividend of 
2.0p per share. The declaration 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 15 
November 2019 to be eligible to receive the forthcoming dividend as new 
shares. 
 
   Board appointment 
 
   I am delighted to announce the appointment of Anna Kuriakose to the 
Board effective from 1 November 2019. 
 
   Anna is Chief Product Officer at TotallyMoney, one of the UK's fastest 
growing fintech companies which seeks to assist customers in making 
smarter and more informed credit choices and which last year raised 
GBP29 million from investors to accelerate its development. She is also 
the founder of ScaleupLean, an advisory business that provides coaching, 
strategy and tools for startups and companies building technology 
products. Anna's wide range of experience in product and technology will 
provide new and complementary skills to the existing Board as we 
navigate the investment opportunities ahead. 
 
   Fund raising and share issues 
 
   The Company launched a combined offer for subscription with ProVen VCT 
plc on 11 January 2019 to raise up to a total of GBP30 million per 
company, with an over-allotment facility of GBP10 million per company. 
 
   During the period, the Company allotted 43,969,723 shares at an average 
price of 70.7p per share under the Company's offer for subscription 
dated 11 January 2019. In the same period, the Company allotted a 
further 851,834 shares at 65.2p per share under the Company's DRIS in 
respect of the dividend paid on 19 July 2019. 
 
   Since 31 August 2019, the Company has allotted a further 7,732,634 
shares at an average price of 66.0p per share. The Company's offer was 
fully subscribed at this point. 
 
   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 847,155 shares at 
an average price of 63.4p per share and for aggregate consideration (net 
of costs) of GBP537,236. This represented 0.6% of the shares in issue at 
the start of the period. The shares were subsequently cancelled. 
 
   Outlook 
 
   Following several significant disposals by the Company during its last 
two financial years, which generated substantial realised capital gains 
for shareholders, I anticipate a quieter period for disposals over the 
next six months.  However, large corporates are still highly acquisitive, 
so the possibility of further disposals in the next year or so should 
not be discounted. 
 
   The Company has been an active investor in the half year with a number 
of completed investments and further ones at an advanced stage. The 
Investment Manager reports a healthy and robust flow of new investment 
opportunities and the Company is well positioned to pursue these and 
others given the recent strong fundraising. 
 
   Despite Brexit uncertainty and other global trade tensions slowing down 
the economy, small companies with innovative and attractive market 
propositions have the potential to grow significantly more quickly than 
the economy as a whole. The Company's investment focus is on such 
companies and as a consequence I continue to be cautiously optimistic 
about the long term performance of the Company notwithstanding short 
term or wider economic headwinds. 
 
   Marc Vlessing OBE 
 
   Chairman 
 
   4 November 2019 
 
   Investment Manager's Report 
 
   Introduction 
 
   We have pleasure in presenting our half year report for ProVen Growth 
and Income VCT plc (the "Company") for the six months ended 31 August 
2019. 
 
   Investment activity and portfolio valuation 
 
   At 31 August 2019, the Company's investment portfolio comprised 44 
investments at a cost of GBP77.6 million and a valuation of GBP74.1 
million. This represents an overall unrealised decrease on cost of 
GBP3.5 million or 4.5%. 
 
   During the period, the Company invested a further GBP16.3 million, 
comprising GBP9.9 million into four new companies and GBP6.4 million 
into five existing portfolio companies. 
 
   The Company invested in Papier (GBP3.15 million), a stationery retailer 
specialising in curated collections unique to the market, in July 2019. 
The new investment in Sannpa Ltd (t/a Fnatic) (GBP2.84 million), an 
eSports team owner and lifestyle brand, with professional teams in the 
most popular games such as League of Legends, Dota 2 and Battlefield 4, 
was completed in April 2019 and was discussed in the Company's most 
recent annual report. The Company invested in Arctic Shores (GBP2.45 
million), a provider of data-driven psychometric tests combining 
neuroscience, artificial intelligence and game technology for more 
predictive and less biased hiring, in August 2019. The Company also 
invested GBP1.47 million in Picasso Labs, an automated creative 
measurement platform that aims to enhance creativity through 
objectivity. Their technology is used globally by Fortune 500 brands 
like Unilever, Mondelez, Heineken, ABI, and more to measure creative 
efficiency, consistency, and impact across all creatives worldwide. 
 
   The follow-on investments were made into ContactEngine (GBP1.64 million), 
Aistemos (GBP1.40 million), Thread (GBP1.40 million), Mycs (GBP1.25 
million) and MPB (GBP700,000). 
 
   The Company's shareholding in 7digital Group plc was sold in the period. 
This resulted in a loss against cost of GBP400,000 though fair valuation 
losses on the investment had largely been recognised in previous periods 
and therefore had negligible impact on the NAV during the period. The 
sale was a strategic decision as, following recent developments in the 
company, the Company's shareholding would soon become VCT 
non-qualifying. 
 
   Skills Matter repaid a small amount of its loan notes (GBP68,000) during 
the period, but has been unable to secure further funding and so we 
continue to have a full provision against the remaining investment. 
 
   Following an interim distribution in respect of the administration of 
MEL Topco Limited (t/a Maplin) in July 2018, an additional GBP68,000 was 
received in August 2019. 
 
   Overall, the venture capital investment portfolio showed an unrealised 
loss of GBP4.9 million, equivalent to 2.6p per share over the period. 
There were valuation uplifts for, amongst others, ContactEngine and 
DeepCrawl, but disappointingly these were more than offset by valuation 
decreases for Blis Media, Smart Assistant, POQ Studio, My First Years, 
InContext and Cogora Group. 
 
 
 
   Post period end portfolio activity 
 
   Since 31 August 2019, there has been no significant portfolio activity 
in the Company to report. 
 
   Outlook 
 
   Following two financial years marked by successful disposals and 
substantial realised profits for shareholders, we are focused on 
investing the funds raised this year, generating a significant pipeline 
of investment opportunities and continuing to support the growth of our 
portfolio companies. We do, however, anticipate a quieter period for 
disposals over the next six months. 
 
   We have successfully completed four new investments over the past six 
months, backing growing businesses in rapidly emerging industries such 
as artificial intelligence and eSports. These investments, which we 
selected through rigorous commercial and financial due diligence, show 
that innovative companies are continuing to flourish in spite of any 
political or economic headwinds. 
 
   Five existing portfolio companies -- ContactEngine, MPB, Thread, Mycs 
and Aistemos -- have shown resilient growth that enabled them to raise 
follow-on funding. This, taken with the prospect of a strong pipeline of 
future investment prospects, makes us cautiously confident about the 
longer-term performance of the Company. 
 
   Beringea LLP 
 
   4 November 2019 
 
   Summary of Investment portfolio 
 
   as at 31 August 2019 
 
 
 
 
                                                        Valuation 
                                                        movement           % of 
                               Cost       Valuation     in period        portfolio 
                              GBP'000      GBP'000       GBP'000         by value 
----------------------  -------------  ------------  ------------  --------------- 
  Top twenty venture 
  capital investments 
  (by value) 
 
Dryden Holdings 
 Limited                        5,000         4,761             -             4.0% 
Zoovu Limited (t/a 
 Smart Assistant)               3,653         4,621       (1,478)             3.9% 
ContactEngine Limited           2,330         4,600           926             3.9% 
Sealskinz Holdings 
 Limited                        3,116         4,461            30             3.7% 
Poq Studio Limited              2,848         3,797         (801)             3.2% 
Thread, Inc.                    3,309         3,748           414             3.1% 
D30 Holdings Ltd                3,550         3,743           387             3.1% 
Infinity Reliance 
 Limited (t/a My 1st 
 Years)                         2,769         3,276         (769)             2.7% 
Papier Ltd                      3,150         3,150             -             2.6% 
Written Byte Ltd (t/a 
 DeepCrawl)                     1,612         2,861           667             2.4% 
Sannpa Limited (t/a 
 Fnatic)                        2,839         2,839             -             2.4% 
Mycs GmbH                       2,520         2,520             -             2.1% 
Arctic Shores Limited           2,450         2,450             -             2.1% 
Response Tap Limited            1,440         2,313         (161)             1.9% 
Blis Media Limited              1,083         2,091       (1,587)             1.8% 
MPB Group Limited               1,489         1,875           386             1.6% 
Rapid Charge Grid 
 Limited                        1,888         1,854            28             1.6% 
Been There Done That 
 Global Limited                 1,448         1,778           331             1.5% 
Aistemos Limited                1,681         1,678           (2)             1.4% 
Litchfield Media 
 Limited                        1,420         1,664             -             1.4% 
Other venture capital 
 investments                   28,013        14,062       (3,230)            12.0% 
----------------------  -------------  ------------  ------------  --------------- 
Total venture capital 
 investments                   77,608        74,142       (4,859)            62.4% 
----------------------  -------------  ------------  ------------  --------------- 
Cash at bank and in 
 hand                                        44,760                          37.6% 
----------------------  -------------  ------------  ------------  --------------- 
Total investments                           118,902                         100.0% 
----------------------  -------------  ------------  ------------  --------------- 
 
 
   Other venture capital investments at 31 August 2019 comprise:Access 
Systems, Inc., Buckingham Gate Financial Services Limited, Cogora Group 
Limited, Deltadot Limited, Disposable Cubicle Curtains Limited, 
Donatantonio Limited, Duncannon Holdings Limited, Exonar Limited, 
Firefly Learning Limited, Iridium Topco Limited (formerly Honeycomb.TV 
Limited), InContext Solutions, Inc., Inskin Media Limited, Lantum 
Limited, MEL Topco Limited (t/a Maplin), Monica Vinader Limited, Netcall 
plc, Picasso Labs, Inc., Senselogix Limited, Simplestream Limited, 
Skills Matter Limited, 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 Deltadot Limited, 
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 2019 
 
   Investment activity during the six months ended 31 August 2019 is 
summarised as follows: 
 
 
 
 
Additions                      Cost 
                              GBP'000 
Papier Ltd                      3,150 
Sannpa Limited (t/a Fnatic)     2,839 
Arctic Shores Limited           2,450 
ContactEngine Limited           1,642 
Picasso Labs, Inc.              1,470 
Aistemos Limited                1,404 
Thread, Inc.                    1,400 
Mycs GmbH                       1,245 
MPB Group Limited                 700 
                              ------- 
Total                          16,300 
                              ------- 
 
 
 
 
 
 
                        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 
MEL Topco 
 Limited* 
 (t/a 
 Maplin)             -             -            68            68            68 
Skills Matter 
 Limited            68             -            68             -            68 
7digital 
 Group plc         400             1             -         (400)           (1) 
 
Total              468             1           136         (332)           135 
               -------  ------------  ------------  ------------  ------------ 
 
 
   *The proceeds received in respect of MEL Topco Limited (t/a Maplin) 
reflected a further interim distribution in respect of the company's 
administration. 
 
   Unaudited Condensed Income Statement 
 
   for the six months ended 31 August 2019 
 
 
 
 
                                               (unaudited)                (unaudited) 
                                             Six months ended           Six months ended             (audited) 
                                               31 Aug 2019                31 Aug 2018          Year ended 28 Feb 2019 
                                        Revenue  Capital   Total   Revenue  Capital   Total            Total 
                                        GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000          GBP'000 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Income                                      179        -      179      129        -      129                      355 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Realised gains on investments                 -      337      337        -    4,162    4,162                    3,145 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Unrealised (losses)/ gains on 
 investments                                  -  (4,859)  (4,859)        -    3,537    3,537                    3,375 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Investment management fee                 (305)    (916)  (1,221)    (271)    (814)  (1,085)                  (2,083) 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Performance incentive fee                     -        -        -        -    (505)    (505)                    (331) 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Other expenses                            (292)      (1)    (293)    (317)        -    (317)                    (627) 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
(Loss)/ return on ordinary activities 
 before taxation                          (418)  (5,439)  (5,857)    (459)    6,380    5,921                    3,834 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
Tax on ordinary activities                    -        -        -        -        -        -                        - 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
(Loss)/ return attributable to equity 
 shareholders                             (418)  (5,439)  (5,857)    (459)    6,380    5,921                    3,834 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
 
Basic and diluted (loss)/ return per 
 share                                   (0.2p)   (3.1p)   (3.3p)   (0.3p)     4.4p     4.1p                     2.7p 
--------------------------------------  -------  -------  -------  -------  -------  -------  ----------------------- 
 
 
   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 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 2019 
 
 
 
 
                                              (unaudited)  (unaudited)  (audited) 
                                                 31 Aug       31 Aug      28 Feb 
                                                  2019         2018        2019 
                                                GBP'000      GBP'000     GBP'000 
 
Fixed assets 
Investments                                        74,142       63,340     62,769 
--------------------------------------------  -----------  -----------  --------- 
 
Current assets 
Debtors                                               944        2,263        481 
--------------------------------------------  -----------  -----------  --------- 
Cash at bank and in hand                           44,760       42,151     36,380 
--------------------------------------------  -----------  -----------  --------- 
                                                   45,704       44,414     36,861 
--------------------------------------------  -----------  -----------  --------- 
Creditors: amounts falling due within one 
 year                                               (965)      (1,111)    (1,157) 
--------------------------------------------  -----------  -----------  --------- 
 
Net current assets                                 44,739       43,303     35,704 
--------------------------------------------  -----------  -----------  --------- 
 
Net assets                                        118,881      106,643     98,473 
--------------------------------------------  -----------  -----------  --------- 
 
 
Capital and reserves 
Called up share capital                             3,044        2,323      2,331 
--------------------------------------------  -----------  -----------  --------- 
Capital redemption reserve                             32            4         19 
--------------------------------------------  -----------  -----------  --------- 
Share premium account                              31,852            -        946 
--------------------------------------------  -----------  -----------  --------- 
Special reserve                                    65,489       77,908     70,856 
--------------------------------------------  -----------  -----------  --------- 
Capital reserve - realised                         18,071       16,292     19,050 
--------------------------------------------  -----------  -----------  --------- 
Revaluation reserve                                 2,583       11,611      7,043 
--------------------------------------------  -----------  -----------  --------- 
Revenue reserve                                   (2,190)      (1,495)    (1,772) 
--------------------------------------------  -----------  -----------  --------- 
 
Total equity shareholders' funds                  118,881      106,643     98,473 
--------------------------------------------  -----------  -----------  --------- 
 
Basic and diluted net asset value per share         63.2p        74.3p      68.4p 
--------------------------------------------  -----------  -----------  --------- 
 
 
 
 
   The accompanying notes form an integral part of this announcement. 
 
 
 
 
                               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        -    (541)                    -            -        -    (541) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
Dividends paid                       -           -        -  (3,677)                    -            -        -  (3,667) 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
At 31 August 2019                3,044          32   31,852   65,489               18,071        2,583  (2,190)  118,881 
-----------------------------  -------  ----------  -------  -------  -------------------  -----------  -------  ------- 
 
 
 
   Unaudited Condensed Statement of Changes in Equity 
 
 
 
 
                                  Called 
                                    up      Capital     Share 
Six months ended 31 Aug 2018       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 2018                     2,330       1,168    69,935    9,970               11,443       10,080  (1,036)  103,890 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
Issue of new shares                     9           -       410        -                    -            -        -      419 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
Total comprehensive income              -           -         -        -                2,843        3,537    (459)    5,921 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
Transfer of previously 
 unrealised gains now realised          -           -         -        -                2,006      (2,006)        -        - 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
Cancellation of capital 
 redemption reserve                     -     (1,180)         -    1,180                    -            -        -        - 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
Cancellation of share premium 
 account                                -           -  (70,345)   70,345                    -            -        -        - 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
Share buybacks and cancellation      (16)          16         -    (723)                    -            -        -    (723) 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
Dividends paid                          -           -         -  (2,864)                    -            -        -  (2,864) 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
At 31 August 2018                   2,323           4         -   77,908               16,292       11,611  (1,495)  106,643 
--------------------------------  -------  ----------  --------  -------  -------------------  -----------  -------  ------- 
 
 
 
   The special reserve, capital reserve - realised and revenue reserve are 
distributable reserves. Reserves available for distribution therefore 
amount to GBP81,370,000 (2018: GBP92,705,000). 
 
   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 2019 
 
 
 
 
                                                            (unaudited)  (unaudited)  (audited) 
                                                             Six months   Six months       Year 
                                                               ended        ended         ended 
                                                               31 Aug       31 Aug       28 Feb 
                                                                2019         2018          2019 
                                                    Note      GBP'000      GBP'000     GBP'000 
--------------------------------------------------  -----   -----------  -----------  --------- 
Net cash used in operating activities                 A         (1,686)      (4,097)    (3,536) 
--------------------------------------------------  ------  -----------  -----------  --------- 
 
Cashflows from investing activities 
--------------------------------------------------  -----   -----------  -----------  --------- 
Purchase of investments                                        (16,300)      (3,706)    (9,900) 
----------------------------------------------------------  -----------  -----------  --------- 
Sale of investments                                                 136        9,060     14,741 
----------------------------------------------------------  -----------  -----------  --------- 
Net cash (used in)/ from investing activities                  (16,164)        5,354      4,841 
----------------------------------------------------------  -----------  -----------  --------- 
 
Cashflows from financing activities 
--------------------------------------------------  -----   -----------  -----------  --------- 
Proceeds from share issues                                       31,077            -          - 
----------------------------------------------------------  -----------  -----------  --------- 
Share issue costs                                               (1,151)            -          - 
----------------------------------------------------------  -----------  -----------  --------- 
Purchase of own shares                                            (574)        (723)    (1,057) 
----------------------------------------------------------  -----------  -----------  --------- 
Equity dividends paid                                           (3,122)      (2,445)    (7,930) 
----------------------------------------------------------  -----------  -----------  --------- 
Net cash from/ (used in) financing                               26,230      (3,168)    (8,987) 
----------------------------------------------------------  -----------  -----------  --------- 
 
Increase/ (decrease) in cash and cash equivalents     B           8,380      (1,911)    (7,682) 
--------------------------------------------------  ------  -----------  -----------  --------- 
 
Notes to the cash flow statement: 
A Cash flow from operating activities 
(Loss)/ return on ordinary activities before taxation           (5,857)        5,921      3,834 
----------------------------------------------------------  -----------  -----------  --------- 
Loss/ (gain) on investments                                       4,522      (7,699)    (6,520) 
----------------------------------------------------------  -----------  -----------  --------- 
Increase in prepayments, accrued income and other 
 debtors                                                          (194)      (1,755)       (68) 
----------------------------------------------------------  -----------  -----------  --------- 
Decrease in accruals and other creditors                          (157)        (564)      (782) 
----------------------------------------------------------  -----------  -----------  --------- 
Net cash used in operating activities                           (1,686)      (4,097)    (3,536) 
----------------------------------------------------------  -----------  -----------  --------- 
 
B Analysis of net funds 
Beginning of period/ year                                        36,380       44,062     44,062 
----------------------------------------------------------  -----------  -----------  --------- 
Net cash inflows/ (outflows)                                      8,380      (1,911)    (7,682) 
----------------------------------------------------------  -----------  -----------  --------- 
End of period/ year                                              44,760       42,151     36,380 
----------------------------------------------------------  -----------  -----------  --------- 
 
 
 
   The accompanying notes form an integral part of this announcement. 
 
   Notes to the half-yearly report 
 
   for the six months ended 31 August 2019 
 
   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 February 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 28 
February 2019. There has been no change to the accouting policies from 
those disclosed in the financial statements for the year ended 28 
February 2019. 
 
   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 28 February 2019 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 and estimates 
 
   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 and may for a limited period be based on the price of 
      a recent transaction; 
 
   -- 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, reviewed for impairment as appropriate; 
 
   -- where alternative methods of valuation, such as net assets of the 
      business or the discounted cash flows arising from 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. 
 
 
   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 28 February 2019 
      and the six-month period ended 31 August 2018. 
 
   5. Basic and diluted return per share for the period has been calculated on 
      177,779,487 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 
      188,021,663 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 
                                                                           28 Feb 
                           31 Aug 2019                31 Aug 2018           2019 
                    Revenue  Capital   Total   Revenue  Capital   Total     Total 
             Pence  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000  GBP'000   GBP'000 
-----------  -----  -------  -------  -------  -------  -------  -------  --------- 
2018 Final     2.0        -        -        -        -    2,864    2,864      2,864 
-----------  -----  -------  -------  -------  -------  -------  -------  --------- 
2019 
 Special 
 Interim       4.5        -        -        -        -        -        -      6,453 
-----------  -----  -------  -------  -------  -------  -------  -------  --------- 
2019 Final     2.0        -    3,667    3,667        -        -        -          - 
-----------  -----  -------  -------  -------  -------  -------  -------  --------- 
Total 
 dividends 
 paid                     -    3,667    3,667        -    2,864    2,864      9,317 
-----------  -----  -------  -------  -------  -------  -------  -------  --------- 
 
 
   9.      Contingent liabilities, guarantees and financial commitments 
 
   Based on the NAV per share at 31 August 2019, before any performance fee 
accrual, and cumulative dividends paid and payable ahead of 29 February 
2020, 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 2019. Any 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 2019. 
 
 
 
   10.   Called up share capital 
 
   The Company launched a combined offer for subscription with ProVen VCT 
plc on 11 January 2019 to raise up to a total of GBP30 million per 
company, with an over-allotment facility of GBP10 million per company. 
 
 
 
   During the period, the Company allotted 43,969,723 shares at an average 
price of 70.7p per share under the 11 January offer. In the same period, 
the Company allotted a further 851,834 shares at 65.2p per share under 
the Company's DRIS in respect of the dividend paid on 19 July 2019. 
 
 
 
   During the period, the Company completed purchases of 847,155 shares at 
an average price of 63.4p per share and for aggregate consideration (net 
of costs) of GBP537,236. This represented 0.6% of the shares in issue at 
the start of the period. The shares were subsequently cancelled. 
 
 
 
   Since 31 August 2019, the Company has allotted a further 7,732,634 
shares at an average price of 66.0p per share. The Company's offer was 
fully subscribed at this point. 
 
 
 
 
   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 2019                    28 Feb 2019 
             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       159        -        -      159      143        -        -      143 
-----------  -------  -------  -------  -------  -------  -------  -------  ------- 
Loan notes         -        -   14,352   14,352        -        -   15,451   15,451 
-----------  -------  -------  -------  -------  -------  -------  -------  ------- 
Unquoted 
 equity            -        -   24,558   24,558        -        -   27,715   27,715 
-----------  -------  -------  -------  -------  -------  -------  -------  ------- 
Preference 
 shares            -        -   35,073   35,073        -        -   19,460   19,460 
-----------  -------  -------  -------  -------  -------  -------  -------  ------- 
Total            159        -   73,983   74,142      143        -   62,626   62,769 
-----------  -------  -------  -------  -------  -------  -------  -------  ------- 
 
   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 2019, GBP1,221,000 (2018: 
GBP1,085,000) was payable to Beringea LLP in respect of these services. 
At the period end the Company owed Beringea LLP GBP219,000 (2018: 
GBP181,000). 
 
   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 2019 amounted to GBP27,000 (2018: 
GBP27,000) of which GBP14,000 (2018: 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 period ended 31 August 2019, 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 
2019, GBP316,000 (2018: GBP93,000) 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 2019 
amounted to GBP253,000 (2018: GBP274,000). 
 
   During the six months to 31 August 2019, an amount of GBP60,000 (2018: 
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=YEG6-5BrM5jRTAuok4iHLKsLVWBsm6aIN7myzvw6116QPowcJm6nccrWIWOKwr1nrJmr9a0hqrM8966uU2yNThMU1uzITuL51dlDopJ6HQA= 
www.provenvcts.co.uk. 
 
   16.   Post balance sheet events 
 
   Since 31 August 2019, there have been no post balance sheet events, 
either adjusting or non-adjusting, in the Company to report. 
 
 
 
   -(1,180)-1,180---- 
 
 
 
 

(END) Dow Jones Newswires

November 05, 2019 12:55 ET (17:55 GMT)

Copyright (c) 2019 Dow Jones & Company, Inc.
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