TIDMPVN
ProVen VCT plc
Annual Financial Report
Year ended 29 February 2020
ProVen VCT plc, managed by Beringea LLP, today announces the final
results for the year ended 29 February 2020. These results were approved
by the Board of Directors on 1 July 2020.
You may, in due course, view the Annual Financial Report in full at
www.provenvcts.co.uk. All other statutory information can also be found
there.
Financial summary
29 February 2020 28 February 2019
Ordinary Shares as at: Pence Pence
Net asset value per share 70.1 82.2
Dividends paid since launch 68.25 63.75
Total return (net asset value plus dividends paid
since launch) 138.35 145.95
Year on year change in:
Net asset value per share (adjusted for dividends
paid in the year) (9.2%) 10.3%
Chairman's Statement
I present the Annual Report for Proven VCT plc (the "Company") for the
year ended 29 February 2020. This report focuses primarily on the year
to 29 February but as Shareholders are all aware, subsequent to the year
end, the Coronavirus pandemic occurred which had a signi cant impact on
the economy as a whole and on the Company. The portfolio has been
regularly reviewed in this time and a new NAV was released in March in
advance of the share allotments in early April under the Company's most
recent o er for subscription.
Results for the year
Over the year, there was a decrease in Shareholder total return (net
asset value ("NAV") per share plus dividends) of 9.2% which was largely
attributable to the decrease in valuation of ve companies. The Company's
NAV per share fell from 82.2p at 28 February 2019 to 70.1p at 29
February 2020. This included a reduction of 4.5p in relation to dividend
payments.
The total loss on ordinary activities for the year was GBP12.0 million,
or 8.2p per share (2019: pro t of GBP10.3 million, 10.1p per share),
comprising a revenue loss of GBP501,000, or 0.2p per share, (2019:
revenue loss of GBP660,000, 0.6p per share) and a capital loss of
GBP11.5 million, or 8.0p per share (2019: pro t of GBP11.0 million,
10.7p per share). This capital loss was largely caused by an aggregate
decrease of GBP11.2 million in the valuation of ve portfolio companies.
Dividends
During the year ended 29 February 2020, the Company paid a nal dividend
of 2.5p per share in respect of the year ended 28 February 2019 on 19
July 2019 and an interim dividend of 2.0p per Ordinary Share was paid in
respect of the year ended 29 February 2020 on 6 December 2019.
Your Board is proposing a nal dividend for the year ended 29 February
2020 of 2.0p per share to be paid on 28 August 2020 to Shareholders on
the register at 7 August 2020. With total tax-free dividends of 4.0p per
share for the year ended 29 February 2020, this represents cash returned
to Shareholders of 5% on the opening NAV per share at 1 March 2019 after
deducting the prior year nal dividend of 2.5p per share.
Portfolio activity and valuation
Following a period of several years during which a number of pro table
disposals generated strong returns for Shareholders, the focus during
the year has been on supporting the existing portfolio and adding new
investments.
The Company invested a total of GBP10.9 million during the year. Six new
companies were added to the portfolio, at a cost of GBP6.8 million. As
is the nature of early stage investing, there is usually a delay before
the bene t of the Company's investment is re ected in the performance of
the portfolio company. We would not, therefore, expect to recognise an
increase in valuation of new investments for some time.
The Company also provided further investment, totaling GBP4.1 million,
into seven of the companies which the Company has invested in during the
last few years. Further details of all these investments are provided in
the Investment Manager's Review. The performance of the companies in the
portfolio during the year has been mixed, as is to be expected of a
relatively young portfolio of venture capital investments. Some
companies saw increases in valuation o the back of strong trading,
whereas others declined in value as a result of di cult trading as well
as a reduction in comparable company valuation multiples. Overall, the
portfolio decreased in value by GBP12.1 million (2019: increase of
GBP213,000). Further information about key developments at existing
portfolio companies is given in the Investment Manager's Review.
It is important to remember that investment in venture capital should be
considered as a long-term investment and returns should be measured over
the medium term, not a single year.
Fundraising activities
As communicated in the interim statement, the combined o er for
subscription with Proven Growth and Income 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, was fully subscribed due to
strong investor demand.
The Company launched a further combined o er for subscription with
Proven Growth and Income VCT plc on 27 January 2020 to raise up to GBP10
million per company, with an over-allotment facility of GBP10 million
per company, which the Board utilised in part in the amount of up to
GBP5 million per company. The o er closed to new applications on 10
March 2020 with GBP14.2 million of gross proceeds for the Company.
Share buybacks
The Company has a policy of buying back shares that become available in
the market at a discount of approximately 5% to the latest published net
asset value, subject to the Company having su cient liquidity. The
Company retains Panmure Gordon to act as its corporate broker.
Shareholders who are considering selling their shares may wish to
contact Panmure Gordon, who will be able to provide details of the price
at which the Company is buying shares.
During the year, the Company purchased 2,573,632 Ordinary Shares at an
average price of 73.0p per share and for an aggregate consideration of
GBP1,878,000. This represented 2.45% of the Company's issued share
capital at the start of the year. All shares were subsequently
cancelled.
A special resolution to allow the Company to continue to make market
purchases of its own shares of up to 14.99% of the share capital for
cancellation will be proposed at the forthcoming Annual General Meeting
("AGM").
Performance Fee
The Company's performance incentive arrangements are an important aid
for the Investment Manager, Beringea LLP ("Beringea" or the "Investment
Manager"), in recruiting and retaining talented investment professionals
against competition from other investment management companies. The
performance fee structure is designed to align the interests of the
Investment Manager with those of Shareholders and encourages capital
growth as well as signi cant payments to Shareholders by means of
tax-free dividends, as determined by the Directors.
In consideration of the Investment Manager's performance in managing the
Original Ordinary Share Portfolio (prior to 2012), a performance
incentive fee linked to the pro t achieved on the disposal of Think
Limited is payable, known as the "Residual PIF". An amount of GBP31,000
was paid to Beringea LLP in relation to the realised gain achieved on
the disposal of Think Limited that completed during the year. There is
no more Residual PIF payable by the fund.
Based on the NAV per share at 29 February 2020, no performance fee is
accrued at the year-end as the performance hurdles had not been met and
consequently there is no obligation for a performance fee.
The payment of a performance fee in future years and the amount thereof,
if any, will be dependent on both the performance of the Company and the
level of dividends paid to Shareholders, as determined by the Directors.
Annual General Meeting
In planning our AGM we have sought to prioritise the safety and
wellbeing of our Shareholders and employees. In light of the current
Coronavirus 'social distancing' measures in England, and the legislative
measures that have been proposed to allow companies to hold general
meetings safely, the AGM will be held as a closed AGM and Shareholders
will not be able to attend the AGM this year. The meeting will still
comply with the minimum legal requirements for an AGM.
The closed AGM will be held at 2.00 p.m. on Monday 10 August 2020 via
electronic means. Full details of the business to be conducted at the
AGM are given in the formal Notice of Annual General Meeting which will
be sent to Shareholders by their preferred method in due course.
Resolution 12 proposes a change to the Company's Articles of Association
that will allow Shareholders to participate remotely in future AGMs. A
copy of the proposed new articles of association is available on the
website at https://www.provenvcts.co.uk/.
Shareholders are encouraged to submit their votes by proxy, as they will
not be able to do so in person. In addition, we strongly recommend
voting electronically at www.signalshares.com as your vote will
automatically be counted. Given the current situation, with many people
working from home and delays in the postal system, there is a risk that
your vote may not be counted if you send a paper proxy.
We always welcome questions from our Shareholders at the AGM but this
year, given the restrictions in place, please send any questions via
email to info@beringea.co.uk by 5:00 pm on Monday 3 August 2020. Answers
to the themes in the questions received will be addressed on the website
at https://www.provenvcts.co.uk/. In addition the Company's annual
Shareholder event will proceed in the Autumn, albeit in a di erent
format (further details below).
Shareholder event
The Company's annual Shareholder event provides an important opportunity
for Shareholders to hear from the Investment Manager, discussing
performance and investment activity, as well as receiving insights and
updates from our portfolio companies.
For your Board and the Investment Manager, it is also a vital platform
for gathering and discussing the views of our Shareholders. It is with
this in mind that we are seeking to ensure that we can continue to
deliver the Shareholder event in the current environment.
Therefore, in order to ensure the safety and wellbeing of our
Shareholders, employees and portfolio companies, we will be hosting our
rst fully-digital Shareholder Day in the Autumn, using an online
platform to deliver our usual insights into fund performance and market
conditions, as well as providing an opportunity for you to ask questions
of our investment team and hear from our portfolio companies.
We will soon distribute invitations to this digital event, as well as
providing you with further information on the format and logistics for
the day and we would encourage you to join us for the session.
Outlook
The Company has been able to remain active and productive in spite of a
challenging economic, social and political backdrop. while contending
with a global pandemic alongside the UK's departure from the European
union, the Company has managed to deliver a successful fundraise,
provide important resources to support our portfolio and continue to
harness a resilient pipeline of investment opportunities.
The economic and commercial turbulence created by the Coronavirus
pandemic subsequent to the year end has inevitably had an impact on the
Company. This resulted in a revaluation of the portfolio to take account
of the context in which we are now operating and the announcement of a
reduced net asset value in March. Nonetheless,I believe that the Company,
through its Investment Manager, has e ectively helped to guide our
portfolio companies through the immediate shock of the outbreak and it
is now working alongside these portfolio companies to help them prepare
and adapt to a new trading environment. The Directors of the Company
will continue to monitor the performance of the portfolio carefully and
will announce a new net asset value per share if there is a material
movement in valuations.
We warmly welcome our new Shareholders who joined the fund as part of
the share o er that successfully closed in March. The funds raised
provide the Company with additional resources to support our existing
portfolio through any prolonged economic disruption, and ensure that it
is able to harness a pipeline of investment opportunities that remains
resilient. The Investment Manager has continued to do this following a
successful transition to operating remotely during the lockdown, with
recent additions to the portfolio and follow-on investments completed
through an entirely digital process.
Despite the current challenging economic and social conditions, the
Board remains con dent that the Company has resilient long-term
prospects.
Neal Ransome
Chairman
Investment Manager's Review
Introduction
Following a number of successful realisations in the last couple of
years, the focus this year was on investing into new portfolio companies
as well as supporting the current portfolio. During the year, a total of
GBP6.8 million was invested in six new portfolio companies and GBP4.1
million in seven existing portfolio companies.
At 29 February 2020, the Company's venture capital portfolio comprised
47 investments at a cost of GBP74.5 million and a valuation of GBP67.6
million, an overall decrease of 9.3% on cost.
Subsequent to the year end the Company issued 20,351,020 Ordinary Shares
for on aggregate consideration of GBP14.2 million under the combined o
er for subscription with Proven Growth and Income VCT plc which launched
on 27 January 2020. Share issue costs thereon amounted to GBP500,000.
The Company remains well capitalised to take advantage of new investment
opportunities and support existing portfolio companies where
appropriate.
Investment activity
New investments
we continued to experience a strong level of deal ow, with GBP6.8
million being invested during the year in six new portfolio companies.
The new investments in the year are:
-- Stylescape Limited (t/a EDITED) (GBP1.50m) -- a SaaS
provider of pricing and product intelligence for apparel and fashion
retailers;
-- Papier Ltd (GBP1.35m) -- an online stationery retailer,
specialising in unique curated collections;
-- Our Path Ltd (t/a Second Nature) (GBP1.2m) -- a provider
of a digital healthcoaching app, with an evidence-based program for
lifestyle change and diabetes prevention/weight loss;
-- Arctic Shores Limited (GBP1.05m) -- a provider of
data-driven psychometric tests combining neuroscience, arti cial
intelligence and game technology for more predictive and less biased
employee recruitment;
-- Sannpa Limited (t/a Fnatic) (GBP1.029m) -- an eSports
team owner and lifestyle brand, with professional teams in the most
popular games such as League of Legends, Dota 2 and Battle eld 4; and
-- Picasso Labs, Inc. (GBP0.63m) -- an automated creative
measurement platform that aims to enhance creativity through
objectivity. Their technology is used globally by Fortune 500 brands
like Unilever, Mondelez, and Heineken to measure creative e ciency,
consistency, and impact across all creatives worldwide.
Follow-on investments
The Company has also been active in supporting the development of
existing portfolio companies, making follow-on investments in the
following seven companies during the year: Mycs (GBP1.05m),
ContactEngine (GBP0.70m), Thread (GBP0.6m), Aistemos (GBP0.6m), POQ
(GBP0.5m), Festicket (GBP0.38m) and MPB (GBP0.3m).
Investment disposals
Although the disposal of Think was completed in a prior year, contingent
proceeds of GBP2.1 million were recognised in the current year. As
reported in the interim statement, the Company's shareholding in
7digital Group was sold in the year resulting in a loss against cost of
GBP1.1 million. The loss was recognised in previous years so there was
no impact to the NAV during the year.
Monmouth Holdings and Rapid Charge Grid repaid GBP1.1m and GBP1.05m of
loans to the Company during the year. Skills Matter repaid GBP32,000 of
its loan notes during the year.
Key developments at existing portfolio companies
Several companies have seen increases in value at the year end, owing to
strong performance.
ContactEngine performed well in the year, securing several large new
customer contracts. In November, it won the award for "Best use of IP"
at the Sunday Times hiscox Tech Track 100 awards. ContactEngine closed a
further funding round of GBP3.75 million in August 2019, to which the
Company contributed GBP0.7 million. The value of the Company's
investment has increased to GBP3.0m on a cost of GBP1.3m.
DeepCrawl has grown its revenue signi cantly in the year. It also closed
a $15 million funding round in December 2019, led by specialist US
software investor, Five Elms. This has given DeepCrawl signi cant
repower to invest in accelerating its growth rate, particularly in the
USA which already accounts for more than half of its revenue. This has
led to an increase in value of the Company's investment to GBP3.3m on a
cost of GBP1.9m.
A number of portfolio companies have faced di cult trading conditions
during the year and in particular ve companies have had a combined
decrease in valuation of GBP11.2m.
POQ Studio, InContext, SmartAssistant and My 1st Years have faced
obstacles over the past twelve months and have struggled to hit their
milestones and grow their revenues as originally budgeted. As a result,
there has been a combined decrease in valuation of GBP9.6 million.
In addition, Blis has been impacted by the falling comparative multiples
for advertising technologies used to value the business as well as
slower than anticipated growth in revenues.
We continue to work closely with these companies to help them through
these challenges.
Overall, the investment portfolio held at the year-end showed a decrease
in value of GBP12.1 million (2019: increase of GBP0.2 million).
Post year-end developments
The global Coronavirus pandemic has impacted a wide range of companies.
On 23 March this year a revised NAV of 65.1p per share was announced to
re ect the immediate valuation impact on the Company's portfolio. This
compares to a NAV of 70.1p per share as at 29 February 2020.
Between 29 February 2020 and the date of this report, the Company issued
20.3 million Ordinary Shares for an aggregate consideration of GBP14.2
million under the combined o er for subscription with Proven Growth and
Income VCT plc which launched on 27 January 2020. Share issue costs
thereon amounted to GBP500,000.
The Company has invested into the following new companies subsequent to
the year end:
-- 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; and
-- Luxury Promise (GBP1.35 million) - a re-sale platform
for luxury women's handbags and accessories
The Company also made follow on investments into Fnatic (GBP0.5 million),
Thread (GBP0.42 million) and ContactEngine (GBP125,000).
In May 2020, the Company's holding in SPC International Limited was
sold. The Company received GBP544,000 in disposal proceeds.
Outlook
The short-term outlook for the UK economy will be dominated by the
Coronavirus pandemic. We will continue to work closely with our
portfolio companies to support them through the challenges this has
created, including providing additional investment where this is
appropriate. Fortunately, few of the investments in the portfolio are in
sectors which have been severely a ected by Coronavirus, such as travel,
hospitality and traditional retailing. Therefore, despite the recent
reductions in the valuations of some portfolio companies, we are
cautiously optimistic about the prospects of the portfolio as a whole
over the medium term.
Following the recent fundraising, the Company is now well placed to take
advantage of new investment opportunities. While some companies have
been badly a ected by Coronavirus, others have seen minimal impact and
certain sectors are likely to bene t from the acceleration of market
trends arising from the Coronavirus. We are still seeing a strong ow of
investment opportunities and will continue to invest selectively where
we believe companies have excellent long-term prospects and the pricing
of the investment is appropriate. The economic disruption caused by
Coronavirus may result, over the next 12 months, in a softening of the
lofty investment valuations we have seen recently. This should help to
deliver strong returns from investments made during this period.
Despite the turbulent broader economic and political environment, we
believe that there will still be opportunities for well-managed, agile,
entrepreneurial companies to prosper. we believe the Company is well
placed to take advantage of opportunities to invest in these businesses.
Beringea LLP
Investment Manager
Investment activity
Investment activity during the year is summarised as follows:
Additions Cost GBP'000
Stylescape Limited (t/a EDITED) 1,500
Papier Ltd 1,350
Our Path Ltd (t/a Second Nature) 1,200
Arctic Shores Limited 1,050
Mycs Gmbh 1,045
Sannpa Limited (t/a Fnatic) 1,029
ContactEngine Limited 704
Picasso Labs, Inc. 630
Thread, Inc. 600
Aistemos Limited 596
POQ Studio Ltd 500
Festicket Ltd 384
MPB Group Limited 300
Total 10,888
------------
Realised
gain/ Realised
Market (loss) gain/ (loss)
value at Disposal against during the
Disposals Cost 01/03/19 proceeds cost year
GBP'000 GBP000 GBP'000 GBP'000 GBP'000
Think Limited -- -- 2,113 2,113 2,113
Monmouth
Holdings
Limited* 1,100 1,100 1,100 -- --
Rapid Charge
Grid
Limited* 1,050 1,050 1,050 -- --
MatsSoft
Limited -- -- 201 201 201
MEL Topco
Limited (t/a
Maplin) 2,218 -- 98 (2,120) 98
Skills Matter
Limited* 32 -- 32 -- 32
Senselogix
Limited -- 175 -- -- (175)
7digital
Group plc 1,101 4 1 (1,100) (3)
Total 5,501 2,329 4,595 (906) 2,266
------- ------------ ------------ ------------ ------------
* Loan note repayment
Of the disposals above, MatsSoft Limited was realised in the prior year
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) re
ect a further interim distribution in respect of the company's
administration. In addition, MEL Topco Limited (t/a Maplin), which had a
cost of GBP2,218,000 and a market value of nil at 1 March 2019, was
dissolved in December 2019. However, the loss of GBP2,218,000 had
already been recognized as realised in a prior period.
Investment Portfolio
as at 29 February 2020
The following investments were held at 29 February 2020:
Valuation
movement in % of portfolio
Cost Valuation year by value
GBP'000 GBP'000 GBP'000
Venture capital
investments (by value)
In nity Reliance
Limited (t/a My 1st
Years) 4,731 5,148 (1,073) 5.0%
Litch eld Media
Limited* 3,580 4,069 (130) 3.9%
Mycs Gmbh 4,595 3,890 (705) 3.7%
Monica Vinader
Limited** 534 3,814 497 3.7%
Festicket Ltd 3,633 3,633 -- 3.5%
Access Systems, Inc. 3,500 3,500 -- 3.4%
Zoovu Limited (formerly
Smart Assistant) 3,487 3,404 (1,755) 3.3%
Thread, Inc. 3,351 3,354 (29) 3.2%
Written Byte Ltd (t/a
DeepCrawl) 1,888 3,293 1,018 3.2%
ContactEngine Limited 1,266 2,960 594 2.8%
Rapid Charge Grid
Limited* 3,150 2,699 (312) 2.6%
MPB Group Limited 2,511 2,665 154 2.6%
Exonar Limited 2,496 2,171 (325) 2.1%
Poq Studio Ltd 3,652 2,069 (3,833) 2.0%
Lupa Foods Limited
(formerly Donatantonio
Group Limited) 1,078 1,935 180 1.9%
Response Tap Limited 1,060 1,911 90 1.8%
Aistemos Limited 1,819 1,821 2 1.8%
Stylescape Limited (t/a
EDITED) 1,500 1,500 -- 1.4%
Disposable Cubicle
Curtains Limited (t/a
Hygenica)** 2,871 1,382 (812) 1.3%
Papier Ltd 1,350 1,350 -- 1.3%
Blis Media Limited** 841 1,202 (1,655) 1.2%
Our Path Ltd (t/a
Second Nature) 1,200 1,200 -- 1.2%
Arctic Shores Limited 1,050 1,050 -- 1.0%
Sannpa Limited (t/a
Fnatic) 1,029 1,029 -- 1.0%
Fire y Learning Limited 1,202 943 (310) 0.9%
D30 holdings Ltd** 956 926 22 0.9%
Honeycomb.Tv Limited 900 878 6 0.8%
Sealskinz Holdings
Limited** 834 834 (352) 0.8%
Been There Done That
Global Limited 553 782 229 0.8%
Picasso Labs, Inc. 630 630 -- 0.6%
SPC International
Limited 58 546 66 0.5%
Cogora Group Limited** 2,643 415 (618) 0.4%
Simplestream Limited** 191 226 28 0.2%
Monmouth Holdings
Limited 400 208 -- 0.2%
Netcall plc 287 171 44 0.1%
64,826 67,608 (8,979) 65.1%
Other venture capital
investments 9,653 18 (3,087) 0%
------- --------- --------------- ----------------
Total venture capital
investments 74,479 67,626 (12,066) 65.1%
Cash at bank and in
hand 36,310 34.9%
Total investments 103,936 100.0%
---------
Valuation movement in the year excludes the cost of investments made in
the year.
Other venture capital investments at 29 February 2020 comprise:
Buckingham Gate Financial Services Limited, InContext Solutions, Inc.,
Inskin Media Limited, Lantum Limited, Macklin Holdings Limited* ,
Senselogix Limited, Skills Matter Limited**, Utility Exchange Online
Limited (t/a SwitchmyBusiness.com), Whistle Sports, Inc., TVPlayer
Limited and Vigilant Applications Limited*.
* Non qualifying investment
** Partially non qualifying investment
With the exception of Netcall plc which is quoted on AIM, all venture
capital investments are unquoted.
All venture capital investments are registered in England and Wales
except for InContext Solutions, Inc., Picasso Labs Inc., Whistle Sports,
Inc., Access Systems, Inc, Deepcrawl holdings, Inc. and Thread, Inc.,
which are Delaware registered corporations in the United States of
America and Mycs Gmbh, which is registered in Germany.
Strategic Report
The Directors present the Strategic Report for the year ended 29
February 2020. The Board prepared this report in accordance with the
Companies Act 2006 (Strategic Report and Directors' Reports) Regulations
2013.
Principal objectives and strategy
The Company's investment objective is to achieve long-term returns
greater than those available from investing in a portfolio of quoted
companies, by investing in:
--a portfolio of carefully selected qualifying investments in small and
medium sized unquoted companies with excellent growth prospects; and
--a portfolio of non-qualifying investments permitted for liquidity
management purposes, within the conditions imposed on all VCTs, and to
minimise the risk of each investment and the portfolio as a whole.
The Company has been approved by HM Revenue and Customs ("HMRC") as a
Venture Capital Trust in accordance with Part 6 of the Income Tax Act
2007 and, in the opinion of the Directors, the Company has conducted its
a airs so as to enable it to continue to maintain approval. Approval for
the year ended 29 February 2020 is subject to review should there be any
subsequent enquiry under corporation tax self-assessment.
The Directors consider that the Company was not, at any time, up to the
date of this report, a close company within the meaning of Section 414
of the Income and Corporation Taxes Act 1988.
Business model
The business acts as an investment company, investing in a portfolio of
carefully selected smaller companies. The Company operates as a Venture
Capital Trust to ensure that its Shareholders can bene t from tax
reliefs available and has outsourced the portfolio management and
administration duties.
Business review and developments
The Company began the year with GBP71.1 million of venture capital
investments and ended with GBP67.6 million spread over a portfolio of 47
companies. 41 of these investments with a value of GBP60.1 million were
VCT qualifying (or part qualifying).
The loss on ordinary activities after taxation for the year was GBP12
million, comprising a revenue loss of GBP501,000 and a capital loss of
GBP11.5 million. The capital loss is largely attributed to the decrease
in valuation in ve portfolio companies which have faced di cult trading
conditions. The Ongoing Charges ratio (excluding performance fees and
recoverable VAT) as calculated in line with the AIC methodology is an
Alternative Performance Measure used by the Board to monitor expenses.
The Ongoing Charges ratio in respect of the year ended 29 February 2020
was 2.55% (2019: 3.1%).
The Company's business review and developments during the year are
reviewed further within the Chairman's Statement, Investment Manager's
Review and Review of Investments.
Investment policy
The Company's investment policy covers several areas as follows:
Qualifying investments
The Company seeks to make investments in VCT Qualifying companies with
the following characteristics:
-- a strong, balanced and well-motivated management team with a proven track
record of achievement;
-- a defensible market position;
-- good growth potential;
-- an attractive entry price for the Company; and
-- a clearly identified route for a profitable realisation within a three to
four year period.
The Company invests in companies at various stages of development,
including those requiring capital for expansion, but not in start-ups or
management buy-outs or businesses seeking to use funding to acquire
other businesses. Investments are spread across a range of different
sectors.
Other investments
Funds not invested in qualifying investments may be invested in
non-qualifying investments permitted for liquidity management purposes,
which include cash, alternative investment funds ("AIFs") and UCITS
which may be redeemed on no more than 7 days' notice, or ordinary shares
or securities in a company that are acquired on a regulated market.
Borrowings
It is not the Company's intention to have any borrowings. The Company
does, however, have the ability to borrow a maximum amount equal to the
nominal capital of the Company and its distributable and undistributable
reserves which, at 29 February 2020, was equal to GBP105.4 million
(2019: GBP86.3 million). There are no plans for the Company to borrow at
the current time.
Maximum exposures
No investment will constitute more than 15% of the Company's portfolio
by value at the time of investment.
Listing Rules
In accordance with the Listing Rules:
1. the Company may not invest more than 10%, in aggregate, of the value of
the total assets of the Company at the time an investment is made in
other listed closed-ended investment funds except listed closed-ended
investment funds which have published investment policies which permit
them to invest no more than 15% of their total assets in other listed
closed-ended investment funds;
2. the Company must not conduct any trading activity which is significant in
the context of the Company; and
3. the Company must, at all times, invest and manage its assets in a way
which is consistent with its objective of spreading investment risk and
in accordance with its published investment policy set out in this
announcement. This investment policy is in line with Chapter 15 of the
Listing Rules and Part 6 Income Tax Act 2007.
Venture capital trust regulations
The Company has engaged Philip Hare & Associates LLP to advise it on
compliance with VCT requirements, including evaluation of investment
opportunities as appropriate and regular review of the portfolio.
Although Philip Hare & Associates LLP works closely with the Investment
Manager, they report directly to the Board.
Compliance with the main VCT regulations as at 28 February 2020 and for
the year then ended is summarised as follows:
The Company holds at least 70 per cent. of its investments Complied
in qualifying companies (as defined by Part 6 of the
Income Tax Act 2007)
At least 70 per cent. (in the case of funds raised Complied
after 5 April 2011) of the Company's qualifying investments
(by value) are held in "eligible shares" -- ("eligible
shares" generally being ordinary share capital)
At least 10 per cent. of each investment in a qualifying Complied
company is held in "eligible shares" (by cost at time
of investment)
No investment in a company constitutes more than 15 Complied
per cent. of the Company's portfolio (by value at
time of investment)
The Company's income for each financial year is derived Complied
wholly or mainly from shares and securities Complied
The Company distributes sufficient revenue dividends
to ensure that not more than 15 per cent. of the income
from shares and securities in any one year is retained
Complied
The Company has not made a prohibited payment to Shareholders
derived from an issue of shares since 6 April 2014
Complied
No investment made by the Company causes an investee
company to receive more than the permitted investment
from State Aid sources (including from VCTs)
Since 18 November 2015, the Company has not made an Complied
investment in a company which exceeds the maximum Complied
permitted age requirement
The funds invested by the Company in another company
since 18 November 2015 have not been used to make
a prohibited acquisition
Since 6 April 2016, the Company has not made a prohibited Complied(1)
non-qualifying investment.
(1) As part of the Company's disposal of Think Limited,
the Company received shares in Atom Bank plc. HMRC
has agreed to allow the Company a period of time to
dispose of these shares.
Investment management and administration fees
Beringea provides investment management services to the Company for an
annual fee of 2.0% of the net assets per annum. Beringea is also
entitled to receive performance incentive fees as described below. The
investment management agreement is terminable by either party at any
time by one year's prior written notice. The total fees relating to this
service amounted to GBP2,321,000 (2019: GBP7,659,000), comprising a
management fee of GBP2,291,000 (2019: GBP2,045,000) and performance
incentive fees as described below of GBP31,000 (2019: GBP5,614,000). At
the year- end, an amount of GBP181,000 (2019: GBP5,592,000) was
outstanding.
The Board is satis ed with Beringea's approach and procedures in
providing investment management services to the Company. The Directors
have therefore concluded that the continuing appointment of Beringea as
Investment Manager remains in the best interests of Shareholders.
Throughout the year ended 29 February 2020 Beringea also provided
administration services to the Company. In the year, total
administration fees amount to GBP61,000 (2019: GBP61,000). An amount of
GBP15,000 (2019: GBP15,000) remained outstanding at the year end.
The annual running costs (excluding any performance fees payable) of the
Company are subject to a cap of 3.25% of the Company's net assets at the
end of the year. Any running costs in excess of this are borne by
Beringea.
Beringea also received arrangement fees in respect of investments made
by the Company and other VCTs managed by Beringea totalling GBP348,000
(2019: GBP361,000) and monitoring fees of GBP364,000 (2019: GBP506,000)
during the year ended 29 February 2020. These fees are payable by the
investee companies into which the Company invests and are not a direct
liability or expense of the Company.
Performance incentive fees
Under the performance fee arrangements, the Investment Manager is
entitled to receive a performance incentive fee in relation to each
major fundraising (a "Respective O er") if, at the end of a nancial year,
the relevant Respective O er Performance Value exceeds the relevant
Respective O er Hurdle. In this event the performance incentive fee per
Respective O er Share will be equal to 20 per cent of the amount by
which each such Respective O er Performance Value exceeds the relevant
Respective O er Initial Net Asset Value per Share, less the aggregate
amount of any performance incentive fee per Respective O er Share
already paid in respect of that Respective O er in relation to previous
nancial years starting a er 29 February 2012 (which shall not include
Residual PIF).
The Respective O er Performance Value in respect of the relevant nancial
year end is the sum of (i) the audited net asset value per Ordinary
Share or Equivalent Ordinary Share for a Respective O er at that date,
(ii) Respective O er Cumulative Dividends, (iii) all performance feesper
Ordinary Share or Equivalent Ordinary Share paid by the shareholders of
the Respective O er in relation to nancial years starting a er29
February 2012, and (iv) any Residual PIF Adjustment relating to that
Respective O er (whether relating to that or any previous nancial year).
If at the end of a nancial year the relevant Respective O er Performance
Value is less than or equal to the Respective O er Hurdle, no
performance fee will be payable on such Respective O ers in respect of
that nancial year.
The performance fee per Respective O er Share payable for a nancial year
will be reduced, if necessary, to ensure that i) the cumulative
performance fee per Respective O er Share payable to the Investment
Manager in respect of a Respective O er does not exceed 20 per cent. of
the relevant Respective O er Cumulative Dividends; and ii) the audited
net asset value per Ordinary Share or Equivalent Ordinary Share at the
relevant nancial year end plus the relevant Respective O er Cumulative
Dividends plus any Residual PIF Adjustment relating to that Respective O
er is at least equal to the relevant Respective O er Hurdle.
Performance fees for the year ended 29 February 2020 amounted to GBPnil
(2019: GBP5,447,000), of which GBPnil (2019: GBP5,447,000) was
outstanding at the year-end.
Residual PIF
In consideration of the Manager's performance in managing the Original
Ordinary Share Portfolio (prior to 2012), a performance incentive fee
linked to the pro t achieved on the future disposal of two investments
from this portfolio, Espresso Group Limited and Think Limited, will be
payable, known as the "Residual PIF". This performance incentive fee
will be equal to 20% of the aggregate pro t realised on the sale of
Espresso Group Limited and Think Limited, subject to a maximum fee of
GBP673,000 (being 20% of the aggregate unrealised pro t on these
investments as at 31 August 2011). An amount equal to GBP31,000 was paid
to Beringea LLP in relation to the realised gain achieved on the
disposal of Think Limited that completed during the year. No amount
remained outstanding at the year end.
Key performance indicators
At each Board meeting, the Directors consider a number of performance
measures to assess the Company's success in meeting its objective of
delivering long term returns. The key performance indicators for the
Company are compared against the results published by the Association of
Investment Companies ("AIC"). The Board believes the Company's key
performance indicators are:
-- Total return (net asset value plus dividends paid since
launch);
-- Dividends paid and the dividend yield; and
-- Net asset value per share (adjusted for dividends paid
in the year).
The total return is calculated by the net asset value per share plus the
cumulative dividends paid to date. This is a performance measure of the
fund and used to evaluate the total value generated for Shareholders.
The following table shows the total return, annual return shown as the
net asset value per share, dividends paid per annum and the dividend
yield.
29/02/2016 28/02/2017 28/02/2018 28/02/2019 29/02/2020
Total return 120.7 132.8 135.7 145.95 138.35
Net asset value per share (adjusted for dividends
paid in the year)* 4.8% 12.0% 2.7% 10.3% (9.2%)
Dividends paid per share 5p 6.5p 9.5p 27.75p 4.5p
Dividend yield** 5.0% 6.5% 8.9% 27.8% 5.5%
* Calculated as the change in total return in the year divided by the
opening net asset value.
** Calculated as the total dividends paid in the year divided by the
opening net asset value.
The Net Asset Value per share is de ned as an Alternative Performance
Measure and the Board considers it to be the primary measure of
shareholder value.
The key performance indicators are discussed further in the Chairman's
Statement and the Investment Manager's Report.
Principal risks and uncertainties
The principal nancial risks faced by the Company, which include market
price risk, interest rate risk, credit risk and liquidity risk (being
minimal), are summarised within the notes to the nancial statements.
In addition to these risks, the Company, as a fully listed Company on
the London Stock Exchange and as a Venture Capital Trust, operates in a
complex regulatory environment and, therefore, also faces a number of
non- nancial principal risks. A breach of the VCT Regulations could
result in the loss of VCT status, the loss of tax reliefs currently
available to Shareholders and the Company being subject to capital gains
tax. Serious breaches of other regulations, such as the Listing Rules of
the Financial Conduct Authority and the Companies Act 2006, could lead
to suspension from the Stock Exchange and damage to the Company's
reputation.
The Company invests in small and immature businesses and there is a risk
that the performance of these individual businesses negatively impacts
the performance of the Company. 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 businesses.
The Board reviews and agrees policies for managing each of these risks.
The Directors receive reports annually from the Investment Manager on
the compliance of systems to manage these risks, and place reliance on
the Investment Manager to give updates in the intervening periods.
Save for the impact of the Coronavirus pandemic, particularly on
performance and valuation of portfolio companies as well as potential
risks such as future fundraising, the risks faced by the Company have
remained unchanged since the beginning of the nancial year.
Viability statement
The Board has assessed the Company's prospects over the three year
period to 28 February 2023. A three year period has been considered
appropriate as it broadly aligns with the time frame during which the
Investment Manager will be required to invest 80% of the funds from the
most recent o er for subscription in qualifying investments.
In order to support this statement, the Board has carried out a robust
assessment of the principal and emerging risks faced by the Company, as
detailed above, including those risks associated with the Coronavirus
pandemic and Brexit, and considered the availability of mitigating
factors.
The Board considers that the primary risk faced by the Company is
compliance with the VCT rules and although there are a number of
mitigating factors such as a robust deal identi cation and diligence
process, an experienced investment team and consultation with the
Company's VCT status adviser to ensure that investments made comply with
the VCT rules, these factors cannot mitigate the risk that insu cient
qualifying investments are identi ed to ensure ongoing compliance with
the VCT rules.
Accordingly, the amount required to invest in qualifying holdings to
maintain compliance with the VCT rules was a major consideration in the
Board's analysis. Together with the expected liabilities of the Company
for the three years to 28 February 2023, the Board considered the
forecast cash requirements against the expected cash position, taking
into account a level of assumed investment realisations and investment
income during the period. The Board considered scenario analysis with
stress tests on the cash ow forecasts.
Based on the assessment of the above considerations on the cash ow
forecasts, the Board has determined that the Company will be able to
continue in operation, maintain compliance with the VCT rules and meet
its liabilities as they fall due for the three years to 28 February
2023.
Section 172 Statement
Section 172 of the Companies Act 2006 requires the Directors of the
Company to act in a way that they consider, in good faith, will most
likely promote the success of the Company for the bene t of the members
as a whole. In doing so, the Directors should have regard (amongst other
matters) to:
-- the likely consequences of any decision in the long
term;
-- the interests of the Company's employees;
-- the need to foster the Company's business relationships
with suppliers, customers and others;
-- the impact of the Company's operations on the community
and the environment;
-- the desirability of the Company maintaining a reputation
for high standards of business conduct; and
-- the need to act fairly as between members of the
Company.
The Board considers its signi cant stakeholder groups to be its
Shareholders, its suppliers (including the Investment Manager to whom
most executive functions are delegated) and its portfolio companies. The
Company is an externally managed investment company with no employees
and no customers in the traditional sense and, therefore, there is
nothing to report in relation to these relationships. The Company takes
a number of steps to understand the views of its key stakeholders and
considers these, along with the matters set out above, in Board
discussions and decision making.
Shareholders
The Company's Shareholders are key to the success of the Company and the
Board engages and communicates with Shareholders by various means. The
Company encourages all Shareholders to attend its annual Shareholder Day,
which last year was held on 13 November 2019 and attended by around 250
Shareholders, and gives Shareholders the opportunity to ask questions of
the Board and the Investment Manager and also hear from some of our
portfolio companies. Given the Coronavirus pandemic, the Company is
putting in place arrangements for the 2020 Shareholder Day to be held
virtually so that our Shareholders will still be given the opportunity
to engage with the Board and Investment Manager and hear from some of
our new portfolio companies. Further details of the 2020 Shareholders
Day can be found in the Chairman's Statement.
The Board also encourages all Shareholders to vote on the resolutions at
the Annual General Meeting. The Company's Annual General Meeting, this
year on 10 August 2020, is typically used as another opportunity to
communicate with Shareholders. However, as detailed in the Chairman's
Statement, in light of the current Coronavirus 'social distancing'
measures in England, the AGM will be run as a closed meeting and
Shareholders will not be able to attend this year. However, Shareholders
are still strongly encouraged to submit their votes by proxy and will
also be able to submit questions via email to info@beringea.co.uk by
5:00 pm on Monday 3 August 2020. Answers to the themes in the questions
received will be addressed on the website at
https://www.provenvcts.co.uk/. As a result of the Shareholder events,
together with other communications with Shareholders and advisors, the
Company has received useful feedback which allows the Board to better
understand the nature of stakeholder concerns. The Board works very
closely with the Investment Manager in reviewing how stakeholder issues
are handled, ensuring good governance and responsibility in managing the
Company's a airs. Ultimately, the Directors' decisions are intended to
achieve the Company's principle objective to achieve long term returns
for Shareholders greater than those available from investing in a
portfolio of quoted companies. In addition, the Board has continued to
maintain the existing arrangements for payments of dividends, dividend
re-investment and buy-backs in order to give predictable income returns
and liquidity to Shareholders when requested.
Suppliers
The Company's suppliers, and in particular Beringea as Investment
Manager, are the cornerstone of the Company's business. There is regular
contact with the Investment Manager and members of the Investment
Manager's senior management team attend all of the Company's Board
meetings. Since the outbreak of the Coronavirus pandemic, the Board has
been in more frequent communication with the Investment Manager to
ensure an appropriate and transparent response.
Portfolio Companies
The Investment Manager provides updates to the Board on the entire
portfolio at least quarterly and this has happened more regularly with
the outbreak of the Coronavirus pandemic. In addition to the Investment
Manager's usual monitoring of portfolio companies, in the weeks
immediately following the start of the outbreak in Europe, the
Investment Manager worked closely with the leadership teams of portfolio
companies to ensure that they were prepared for the disruption caused by
a global pandemic. The Investment Manager continues to work closely with
management teams to ensure that they continue to evaluate and react
accordingly to the evolving situation.
ENVIRONMENTAL, SOCIAL, HUMAN RIGHTS POLICY AND GREENHOUSE EMISSIONS
The Board seeks to conduct the Company's a airs responsibly and maintain
high standards in respect of ethical, environmental, governance and
social issues. The Board recognises the requirement under section 414C
of the Companies Act 2006 to detail information about social and
community issues, employees and human rights; including any policies it
has in relation to these matters and e ectiveness of these policies. As
an externally managed investment company with no employees, the Company
has no formal policies in these matters and as such these requirements
do not apply.
On a general note, the Board considers that the Company's investment
operations create employment, aid economic growth, generate tax revenues
and produce wealth, thus bene ting the community and the economy more
generally. Where appropriate, the investment proposals considered by the
Investment Manager and the Board also include any relevant information
on any social, employee, ethical or environmental matters relevant to
that investment.
Whilst as a UK quoted company the VCT is required to report on its
Greenhouse Gas (GHG) Emissions for any direct emissions, as it
outsources all of its activities and does not have any physical assets,
property, employees or operations, it is not responsible for any direct
emissions.
Directors and senior management
The Company had four non-executive Directors at the year end, three of
whom are male and one of whom is female. The Company has no employees
and the same was true of the previous year.
Directors' remuneration
It is a requirement under Companies Act 2006 for Shareholders to approve
the Directors' remuneration policy every three years, or sooner if the
Company wishes to make changes to the policy. The Directors'
remuneration policy was approved at the AGM of the Company on 11 July
2018 and no changes are proposed for the forthcoming year.
Future prospects
The Company's future prospects are set out in the Chairman's Statement
and Investment Manager's Review.
Despite the economic and social disruption caused by the Coronavirus
pandemic, the Directors do not foresee any major changes in the activity
undertaken by the Company in the coming year. The Company continues with
its objective to invest in unquoted companies throughout the United
Kingdom or with a presence in the United Kingdom, with a view to
providing both capital growth and dividend income to Shareholders over
the long term whilst maintaining VCT qualifying status.
By order of the Board
Beringea LLP
Company Secretary of ProVen VCT plc
Directors' responsibilities
The Directors are responsible for preparing the Annual Report and the
nancial statements in accordance with applicable law and regulations.
They are also responsible for ensuring that the Annual Report and
Accounts includes information required by the Listing Rules of the
Financial Conduct Authority.
Company law requires the Directors to prepare nancial statements for
each nancial year. Under that law the Directors have elected to prepare
the nancial statements in accordance with United Kingdom Generally
Accepted Accounting Practice (United Kingdom Accounting Standards and
applicable law). Under company law, the Directors must not approve the
nancial statements unless they are satis ed that they give a true and
fair view of the state of a airs of the Company and of the pro t or loss
of the Company for that period.
In preparing the nancial statements, the Directors are required to:
--select suitable accounting policies and then apply them consistently;
--make judgments and accounting estimates that are reasonable and
prudent;
--state whether applicable UK accounting standards have been followed,
subject to any material departures disclosed and explained in the
nancial statements;
--prepare the nancial statements on the going concern basis unless it is
inappropriate to presume that the Company will continue in business; and
--prepare a directors' report, a strategic report and directors'
remuneration report which comply with the Companies Act 2006.
The Board considers that the Annual Report and Accounts, taken as a
whole, are fair, balanced and understandable and that they provide the
information necessary for Shareholders to assess the Company's
performance, business model and strategy.
The Directors are responsible for keeping adequate accounting records
that are su cient to show and explain the Company's transactions, to
disclose with reasonable accuracy at any time the nancial position of
the Company and to enable them to ensure that the nancial statements
comply with the requirements of the Companies Act 2006. The maintenance
and integrity of the Company's website is the responsibility of the
directors. They are also responsible for safeguarding the assets of the
Company and hence for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
Directors' responsibilities pursuant to the Disclosure and Transparency
Rule 4
Each of the Directors confirms that to the best of each person's
knowledge:
-- the financial statements, which have been prepared in accordance with
United Kingdom Generally Accepted Accounting Practice, give a true and
fair view of the assets, liabilities, financial position and profit or
loss of the Company; and
-- the Directors' Report, Chairman's Statement, Strategic Report, Investment
Manager's Review and Review of Investments include a fair review of the
development and performance of the business and the position of the
Company, together with a description of the principal risks and
uncertainties that it faces.
Statement as to disclosure of information to the Auditor
The Directors in o ce at the date of the report have con rmed, as far as
they are aware, that there is no relevant audit information of which the
Auditor is unaware. Each of the Directors have con rmed that they have
taken all the steps that they ought to have taken as Directors in order
to make themselves aware of any relevant audit information and to
establish that it has been communicated to the Auditor. This con rmation
is given and should be interpreted in accordance with the provisions of
section 418 of the Companies Act 2006.
Income Statement
for the year ended 29 February 2020
Year ended 29 February 2020 Year ended 28 February 2019
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 597 -- 597 405 -- 405
Realised gains
on investments -- 2,266 2,266 -- 17,995 17,995
Unrealised
(loss) / gain
on investments -- (12,066) (12,066) -- 213 213
-------- -------- -------- -------- -------- --------
597 (9,800) (9,203) 405 18,208 18,613
Investment
management
fees (573) (1,718) (2,291) (511) (1,534) (2,045)
Performance
incentive fees -- (31) (31) -- (5,614) (5,614)
Other expenses (525) (11) (536) (554) (54) (608)
FX Translation -- 30 30 -- -- --
-------- -------- -------- -------- -------- --------
(Loss)/return on
ordinary
activities
before tax (501) (11,530) (12,031) (660) 11,006 10,346
Tax on ordinary
activities - - - - - -
-------- -------- -------- -------- -------- --------
(Loss)/return
attributable
to equity
shareholders (501) (11,530) (12,031) (660) 11,006 10,346
-------- -------- --------
Basic and
diluted
return/(loss)
per share (0.2p) (8.0p) (8.2p) (0.6p) 10.7p 10.1p
All revenue and capital movements in the year relate to continuing
operations. No operations were acquired or discontinued during the year.
The total column within the Income Statement represents the Income
Statement of the Company, prepared in accordance with the accounting
policies detailed in note 1 to the nancial statements. The supplementary
revenue and capital columns are presented for information purposes in
accordance with the Statement of Recommended Practice issued by the
Association of Investment Companies.
A Statement of Comprehensive Income has not been prepared as all gains
and losses are recognised in the Income Statement in the current and
prior year as shown.
Statement of Changes in Equity
for the year ended 29 February 2020
Year ended 29 February 2020
Called
up Capital Share Capital
share redemption Special Premium Revaluation reserve- Revenue
capital reserve reserve reserve reserve realised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- ---------- -------- ------- ----------- --------- ------- ---------
At 1 March 2019 10,504 102 60,820 3,367 6,799 6,412 (1,668) 86,336
-------- ---------- -------- ------- ----------- --------- ------- ---------
Comprehensive
Income for the
year:
Management fees
allocated as
capital
expenditure -- -- -- -- -- (1,718) -- (1,718)
Legal fees
allocated as
capital
expense -- -- -- -- -- (11) -- (11)
Realised gain on
investments -- -- -- -- -- 2,266 -- 2,266
Unrealised loss
on investments -- -- -- -- (12,066) -- -- (12,066)
Loss after tax -- -- -- -- -- -- (501) (501)
Performance fee -- -- -- -- -- (31) -- (31)
-------- ---------- -------- ------- ----------- --------- ------- ---------
Total
comprehensive
loss -- -- -- -- (12,066) 506 (501) (12,061)
Contributions by
and
distributions to
owners:
Issue of new
shares
(includes
DRIS) 4,781 -- (1,418) 36,366 -- -- -- 39,729
Share buybacks (257) 257 (1,888) -- -- -- -- (1,888)
Dividends paid
(includes
DRIS) -- -- (6,787) -- -- -- -- (6,787)
-------- ---------- -------- ------- ----------- --------- ------- ---------
Total
contributions
by and
distributions
to owners 4,524 257 (10,093) 36,366 -- -- -- 31,054
Other movements:
Transfer of
previously
unrealised
gains now
realised -- -- -- -- 2,298 (2,298) -- --
FX translation -- -- -- -- -- -- 30 30
-------- ---------- -------- ------- ----------- --------- ------- ---------
Total other
movements -- -- -- -- 2,298 (2,298) 30 30
At 29 February
2020 15,028 359 50,727 39,733 (2,969) 4,620 (2,139) 105,359
-------- ---------- -------- ------- ----------- --------- ------- ---------
Year ended 28 February 2019
Called
up Capital Share Capital
share redemption Special Premium Revaluation reserve- Revenue
capital reserve reserve reserve reserve realised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-------- ---------- ------- -------- ----------- --------- ------- ---------
At 1 March 2018 10,187 3,837 5,469 52,786 19,677 10,583 (1,008) 101,531
-------- ---------- ------- -------- ----------- --------- ------- ---------
Comprehensive
Income for the
year:
Management fees
allocated as
capital
expenditure -- -- -- -- -- (1,534) -- (1,534)
Legal fees
allocated as
capital
expense -- -- -- -- -- (54) -- (54)
Realised gain on
investments -- -- -- -- -- 17,995 -- 17,995
Unrealised gain
on investments -- -- -- -- 213 -- -- 213
Loss after tax -- -- -- -- -- -- (660) (660)
Performance fee -- -- -- -- -- (5,614) -- (5,614)
-------- ---------- ------- -------- ----------- --------- ------- ---------
Total
comprehensive
profit -- -- -- -- 213 10,793 (660) 10,346
Contributions by
and
distributions to
owners:
Issue of new
shares
(includes
DRIS) 490 -- -- 3,683 -- -- -- 4,173
Share buybacks (173) 173 (1,659) -- -- -- -- (1,659)
Dividends paid
(includes
DRIS) -- -- -- -- -- (28,055) -- (28,055)
-------- ---------- ------- -------- ----------- --------- ------- ---------
Total
contributions
by and
distributions
to owners 317 173 (1,659) 3,683 -- (28,055) -- (25,541)
Other movements:
Transfer of
previously
unrealised
gains now
realised -- -- -- -- (13,091) 13,091 -- --
Cancellation of
share premium
account -- -- 53,102 (53,102) -- -- -- --
Cancellation of
capital
redemption
reserve -- (3,908) 3,908 -- -- -- -- --
-------- ---------- ------- -------- ----------- --------- ------- ---------
Total other
movements -- (3,908) 57,010 (53,102) (13,091) 13,091 -- --
At 28 February
2019 10,504 102 60,820 3,367 6,799 6,412 (1,668) 86,336
-------- ---------- ------- -------- ----------- --------- ------- ---------
The special reserve, capital reserve -- realised and revenue reserve are
all distributable reserves. Reserves available for distribution
therefore amount to GBP53,208,000 (2019: GBP65,564,000).
During the year the Company repurchased 2,573,632 shares (2019:
1,729,240) with a nominal value of GBP257,363 (2019: GBP173,000). All
shares were subsequently cancelled.
The composition of each of these reserves is explained below:
Called up share capital - The nominal value of shares issued, increased
for subsequent share issues either via an offer for subscription or the
Company's dividend reinvestment scheme, or reduced due to shares bought
back by the Company for cancellation.
Capital redemption reserve - The nominal value of shares bought back and
cancelled.
Special reserve -- A distributable reserve which is used to fund shares
bought back by the Company for cancellation and share issue costs on
shares issued under an Offer for Subscription. Dividends that are
classified as capital may be paid from this reserve.
Share premium reserve - This reserve contains the excess of gross
proceeds over the nominal value of shares allotted under offers for
subscription and the Company's dividend reinvestment scheme, to the
extent that it has not been cancelled.
Revaluation reserve - Increases and decreases in the valuation of
investments held at the year-end are accounted for in this reserve,
except to the extent that the diminution is deemed permanent.
In accordance with stating all investments at fair value through profit
and loss, all such movements through both revaluation and capital
reserve -- realised are shown within the Income Statement for the year.
Capital reserve -- realised - The following are accounted for in this
reserve:
-- Gains and losses on realisation of investments;
-- Permanent diminution in value of investments;
-- Transaction costs incurred in the acquisition of investments;
-- 75% of the investment manager's fee expense and 100% of any performance
incentive fee payable; and
-- Other capital expenses and charges.
Dividends that are classified as capital may be paid from this reserve.
Revenue reserve - Income and expenses that are revenue in nature are
accounted for in this reserve together with the related tax effect, as
well as dividends paid that are classified as revenue in nature.
Statement of Financial Position
as at 29 February 2020 29 February 2020 28 February 2019
Total Total
GBP'000 GBP'000
Fixed assets
Investments 67,626 71,133
---------------- ----------------
Current assets
Debtors 2,355 1,478
Cash at bank and in hand 36,310 19,897
---------------- ----------------
38,665 21,375
Creditors: amounts falling due within
one year (932) (6,172)
---------------- ----------------
Net current assets 37,733 15,203
---------------- ----------------
Total assets less current liabilities 105,359 86,336
---------------- ----------------
Capital and reserves
Called up share capital 15,028 10,504
Capital redemption reserve 359 102
Special reserve 50,727 60,820
Share premium reserve 39,733 3,367
Revaluation reserve (2,969) 6,799
Capital reserve -- realised 4,620 6,412
Revenue reserve (2,139) (1,668)
---------------- ----------------
Total equity shareholders' funds 105,359 86,336
---------------- ----------------
Basic and diluted net asset value per 70.1p 82.2p
share
Statement of Cash Flows
for the year ended 29 February 2020
Year ended
29 Year ended
February 28 February
2020 2019
Total Total
GBP'000 GBP'000
(Loss)/return on ordinary activities before
taxation (12,031) 10,346
Loss/(Gain) on investments 9,800 (18,208)
Increase in prepayments, accrued income and other
debtors (92) (98)
(Decrease)/Increase in accruals and other creditors (5,388) 4,376
---------- -----------
Net cash used in operating activities (7,711) (3,584)
---------- -----------
Cash flows from investing activities
Purchase of investments (10,888) (23,468)
Sale of investments 3,810 43,578
---------- -----------
Net cash from investing activities (7,078) 20,110
---------- -----------
Cash flows from financing activities
Proceeds from share issues 39,999 --
Share issue costs (1,418) --
Purchase of own shares (1,740) (1,417)
Equity dividends paid (5,639) (23,883)
Net cash used in financing 31,202 (25,300)
---------- -----------
Increase/(Decrease) in cash and cash equivalents 16,413 (8,774)
---------- -----------
Cash at beginning of year 19,897 28,671
---------- -----------
Cash at end of year 36,310 19,897
---------- -----------
Net cash used in operating activities' includes interest received of
GBP594,000 (2019: GBP405,000) and dividends received of GBP3,000 (2019:
GBPnil). No interest was paid during the period.
Notes to the Announcement
for the year ended 29 February 2020
1. Accounting policies
Basis of preparation
The Company has prepared its nancial statements under Financial
Reporting Standard 102 ("FRS102") 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"), which was revised in
December 2018.
The nancial statements are prepared under the historical cost convention
except for the revaluation of certain nancial instruments measured at
fair value.
The following accounting policies have been applied consistently
throughout the period.
Going concern
The Directors have, at the time of approving the financial statements, a
reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. Thus they
continue to adopt the going concern basis of accounting in preparing the
financial statements.
Presentation of Income Statement
In order to better re ect 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.
Investments
Investments, including equity and loan stock, are recognised at their
trade date and measured at "fair value through pro t or loss" due to
investments being managed and performance evaluated on a fair value
basis. A nancial 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 as follows:
-- where a company is in the early stage of development, the estimate
of fair value is 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 a er 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 re ect factors such as the di erent sizes of the
comparable businesses, di erent 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 Income Statement for the
period as a capital item.
Gains and losses arising from changes in fair value are included in the
Income Statement for the year 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 ows
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.
Fair value
Fair value is defined as the amount for which an asset could be
exchanged between knowledgeable, willing parties in an arm's length
transaction. 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: The unadjusted quoted price in an active market for identical
assets or liabilities that the entity can access at the measurement
date.
Level 2: Inputs other than quoted prices included within Level 1 that
are observable (i.e., developed using market data) for the asset or
liability, either directly or indirectly.
Level 3: Inputs are unobservable (i.e., for which market data is
unavailable) for the asset or liability.
Income
Dividend income from investments is recognised when the shareholders'
rights to receive payment has been established, normally the ex-dividend
date.
Interest income is accrued on a time basis, by reference to the
principal outstanding and at the effective interest rate applicable and
only where there is reasonable certainty of collection in the
foreseeable future. Income which is not capable of being received within
a reasonable period of time is reflected in the capital value of the
investments. A provision is made for any fixed income not expected to be
received.
Expenses
All expenses are accounted for on an accruals basis. In respect of the
analysis between revenue and capital items presented within the Income
Statement, all expenses have been presented as revenue items except as
follows:
-- expenses which are incidental to the acquisition of an investment are
deducted from the Capital Account;
-- expenses which are incidental to the disposal of an investment are
deducted from the disposal proceeds of the investment;
-- expenses are split and presented partly as capital items where a
connection with the maintenance or enhancement of the value of the
investments held can be demonstrated. Accordingly, the investment
management fee has been allocated 25% to revenue and 75% to capital in
order to reflect the Directors' expected long-term view of the nature of
the investment returns of the Company; and
-- performance incentive fees are treated as a capital item.
Taxation
The tax effects of different items in the Income Statement are allocated
between capital and revenue on the same basis as the particular item to
which they relate using the Company's effective rate of tax for the
accounting period.
Due to the Company's status as a venture capital trust and the continued
intention to meet the conditions required to comply with Part 6 of the
Income Tax Act 2007, no provision for taxation is required in respect of
any realised or unrealised appreciation of the Company's investments.
Deferred taxation, which is not discounted, is provided in full on
timing differences that result in an obligation at the balance sheet
date to pay more tax, or a right to pay less tax, at a future date, at
rates expected to apply when they crystallise based on current tax rates
and law.
Timing differences arise from the inclusion of items of income and
expenditure in taxation computations in periods different from those in
which they are included in the financial statements. Deferred tax assets
are recognised to the extent that it is regarded as more likely than not
that they will be recovered.
Share issue costs
Expenses in relation to share issues are deducted from the Special
Reserve.
Cash
Cash comprises cash on hand and demand deposits.
Debtors
Short term debtors are initially measured at transaction price.
Subsequent remeasurement deducts any impairment from the transaction
price.
Creditors
Short term trade creditors are initially and subsequently measured at
the transaction price.
2. Basic and diluted return per share
Year ended 29 February Year ended 28 February
2020 2019
Revenue (loss)/ return
per share based on:
Net (loss)/ revenue after
taxation (GBP'000) (501) (660)
Weighted average number
of shares in issue 145,634,014 102,494,641
Pence per share (0.2) (0.6)
Capital return per share
based on:
Net capital gain for the
financial year
(GBP'000) (11,530) 11,006
Weighted average number
of shares in issue 145,634,014 102,494,641
Pence per share (8.0) 10.7
Total return per share
based on:
Total return for the
financial year
(GBP'000) (12,031) 10,346
Weighted average number
of shares in issue 145,634,014 102,494,641
Pence per share (8.2) 10.1
As the Company has not issued any convertible securities or share
options, there is no dilutive effect on return per share. The return per
share disclosed therefore represents both basic and diluted return per
share.
3. Basic and diluted net asset value per share
2020 2019
Net
asset
Shares in Issue Net asset value value
pence pence
per per
2020 2019 share GBP'000 share GBP'000
Ordinary
Shares 150,278,338 105,041,530 70.1p 105,359 82.2p 86,336
As the Company has not issued any convertible securities or share
options, there is no dilutive effect on net asset value per share. The
net asset value per share disclosed therefore represents both basic and
diluted net asset value per share.
4. Principal risks and management objectives
The Company's investment activities expose the Company to a number of
risks associated with financial instruments and the sectors in which the
Company invests. The principal financial risks arising from the
Company's operations are:
-- Market risks;
-- Credit risk; and
-- Liquidity risk.
The Board regularly reviews these risks and the policies in place for
managing them. There have been no significant changes to the nature of
the risks that the Company is exposed to over the year and there have
also been no significant changes to the policies for managing those
risks during the year. The risk management policies used by the Company
in respect of the principal financial risks and a review of the
financial instruments held at the year-end are provided below:
Market risks
As a VCT, the Company is exposed to market risks in the form of
potential losses and gains that may arise on the investments it holds.
The management of these market risks is a fundamental part of investment
activities undertaken by the Investment Manager and overseen by the
Board. The Investment Manager monitors investments through regular
contact with the management of investee companies, regular review of
management accounts and other financial information and attendance at
investee company board meetings. This enables the Investment Manager to
manage the investment risk in respect of individual investments. Market
risk is also mitigated by holding a portfolio diversified across several
business sectors and asset classes.
The key market risks to which the Company is exposed are:
-- Market price risk; and
-- Interest rate risk.
Market price risk
Market price risk arises from uncertainty about the future prices and
valuations of nancial instruments held in accordance with the Company's
investment objectives. It represents the potential loss that the Company
might su er through market price movements in respect of quoted
investments and also changes in the fair value of unquoted investments
that it holds.
At 29 February 2020, the AIM-quoted portfolio was valued at GBP171,000
(2019: GBP130,000).
The Company's sensitivity to uctuations in the share prices of its
AIM-quoted investments is summarised below. A 20% movement in the share
price of all of the AIM-quoted investments held by the Company would
have an e ect as follows:
20% movement in AIM-quoted
investments 2020 2019
Impact on
Impact on net NAV per Impact on net Impact on NAV
assets share assets per share
GBP'000 pence GBP'000 Pence
AIM-quoted
investments 34 0.0p 26 0.0p
At 29 February 2020, the unquoted portfolio was valued at GBP67,455,000
(2019: GBP71,003,000).
As many of the Company's unquoted investments are valued using revenue
or earnings multiples of comparable companies or sectors, a fall in
share prices generally would impact on the valuation of the unquoted
portfolio. A 20% movement in the valuations of all of the unquoted
investments held by the Company would have an effect as follows:
20% movement in unquoted
investment valuations 2020 2019
Impact on
Impact on net NAV per Impact on net Impact on NAV
assets share assets per share
GBP'000 Pence GBP'000 Pence
Unquoted
investments 13,491 9.0p 14,200 13.6p
The sensitivity analysis for unquoted valuations above assumes that each
of the sub-categories of nancial instruments (ordinary shares,
preference shares and loan stocks) held by the Company produces an
overall movement of 20%. Shareholders should note that equal correlation
between these sub-categories is unlikely to be the case in reality,
particularly in the case of loan stock instruments. Where share prices
are falling, the equity instrument could fall in value before the loan
stock instrument.
Interest rate risk
The Company is exposed to interest rate risk on floating-rate financial
assets through the effect of changes in prevailing interest rates. The
Company receives interest on its cash deposits at a rate agreed with its
bankers. Investments in loan stock attract interest predominately at
fixed rates. A summary of the interest rate profile of the Company's
financial instruments is shown below.
There are three categories in respect of interest which are attributable
to the financial instruments held by the Company as follows:
-- "Fixed rate" assets represent investments with predetermined yield
targets and comprise certain loan note investments.
-- "Floating rate" assets predominantly bear interest at rates linked to
Bank of England base rate or LIBOR and comprise cash at bank and certain
loan note investments.
-- "No interest rate" assets do not attract interest and comprise equity
investments, certain loan note investments, loans and receivables
(excluding cash at bank) and other financial liabilities.
Average Average period 2020 2019
interest rate until maturity GBP'000 GBP'000
Fixed rate 6.8% 417days 9,349 12,672
Floating rate 0.3% 0 days 36,494 20,133
No interest rate 59,516 58,531
------- -------
105,359 86,336
------- -------
The Company monitors the level of income received from xed, oating and
non-interest bearing assets and, if appropriate, may make adjustments to
the allocation between the categories, in particular, should this be
required to ensure compliance with the VCT regulations.
Based on the assumption that the yield of all oating rate nancial
instruments would change by an amount equal to the movement in
prevailing interest rates, it is estimated that an increase of 1% in
interest rates would have increased total return before taxation for the
year by GBP365,000 (2019: GBP201,000). Given the low level of interest
rates through the year, a further decrease is not considered likely.
Credit risk
Credit risk is the risk that a counterparty to a financial instrument is
unable to discharge a commitment to the Company made under that
instrument. The Company is exposed to credit risk through its
investments in cash deposits and debtors. Credit risk relating to loan
stock investee companies is considered to be part of market risk.
The Company's exposure to credit risk is summarised as follows:
2020 2019
GBP'000 GBP'000
Cash and cash equivalents 36,310 19,897
Interest, dividends and other receivables 542 580
------- -------
36,852 20,477
------- -------
The management of credit risk associated with interest, dividends and
other receivables is covered within the investment management
procedures.
Cash is mainly held by the Royal Bank of Scotland plc, rated BBB+ and A+
by Standard and Poor's and Fitch, respectively, and is also ultimately
part-owned by the UK Government. Consequently, the Directors consider
that the risk pro le associated with cash deposits is low.
There have been no changes in fair value during the year that are
directly attributable to changes in credit risk.
Liquidity risk
Liquidity risk is the risk that the Company encounters di culties in
meeting obligations associated with its nancial liabilities. Liquidity
risk may also arise from either the inability to sell nancial
instruments when required at their fair values or from the inability to
generate cash in ows as required. The Company generally maintains a
relatively low level of creditors relative to cash balances (GBP1
million relative to cash balances of GBP36.3 million at 29 February
2020) and has no borrowings.
The Company always holds su cient levels of funds as cash in order to
meet expenses and other cash out ows as required. For these reasons, the
Board believes that the Company's exposure to liquidity risk is minimal.
The Company's liquidity risk is managed by the Investment Manager in
line with guidance agreed with the Board and is reviewed by the Board at
regular intervals.
Although the Company's investments are not held to meet the Company's
liquidity requirements, the table below shows an analysis of the loan
stock, highlighting the length of time that it could take the Company to
realise its loan stock assets if it were required to do so.
The carrying value of loan stock investments (as opposed to the
contractual cash ows) held at 29 February 2020, which is analysed by
expected maturity date, is as follows:
Not
As at 29 February 2020 later Between Between Between More
than 1 1 and 2 2 and 3 3 and 5 than 5
Year Years Years years years Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Fully performing loan
stock 7,178 -- -- 732 384 8,294
Past due loan stock -- -- -- -- 1,169 1,169
------- ------- ------- ------- ------- -------
7,178 -- -- 732 1,553 9,463
------- ------- ------- ------- ------- -------
As at 28 February 2019
Fully performing loan
stock 1,872 9,334 -- 678 -- 11,884
Past due loan stock -- -- -- 1,024 -- 1,024
------- ------- ------- ------- ------- -------
1,872 9,334 -- 1,702 -- 12,908
------- ------- ------- ------- ------- -------
Of the loan stock classified as "past due" above, the full amount
relates to the principal of loan notes where the principal has passed
its maturity date.
Fair Value of Financial Instruments
Fair value measurements recognised in the balance sheet
Investments are valued at fair value as determined using the measurement
policies described in note 1. The carrying value of financial assets and
financial liabilities recorded at amortised cost, which includes short
term debtors and creditors, is considered by the Directors to be
equivalent to their fair value.
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 financial 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.
2020 2019
Level
Level 1 Level 2 Level 3 Total Level 1 Level 2 3 Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
AIM quoted 171 -- -- 171 130 -- -- 130
Loan notes -- -- 9,463 9,463 -- -- 12,908 12,908
Unquoted
investments -- -- 57,992 57,992 -- -- 58,095 58,095
171 -- 67,455 67,626 130 -- 71,003 71,133
------- ------- ------- ------- ------- ------- ------ -------
There have been no movements between levels during the financial year to
29 February 2020.
Reconciliation of fair value for Level 3 financial instruments held at
the year-end:
Loan Notes Unquoted Equity Total
GBP'000 GBP'000 GBP'000
Balance at 1 March 2019 12,908 58,095 71,003
---------- --------------- -------
Movements in the Income Statement:
Gains in the Income Statement (1,679) (8,162) (9,841)
---------- --------------- -------
Purchases at cost 384 10,504 10,888
Sales proceeds (2,150) (2,445) (4,595)
Balance at 29 February 2020 9,463 57,992 67,455
---------- --------------- -------
There is an element of judgment in the choice of assumptions for
unquoted investments and it is possible that, if different assumptions
were used, different valuations could have been attributed to certain of
the VCT's investments.
5. Post balance sheet events
Between 29 February 2020 and the date of this report, the Company issued
20,351,020 Ordinary Shares for an aggregate consideration of GBP14.2
million under the combined o er for subscription with ProVen Growth and
Income VCT plc which launched on 27 January 2020. Share issue costs
thereon amounted to GBP500,000.
In March 2020, the Company invested in two pre-existing portfolio
companies. GBP772,000 was invested in Fnatic and GBP421,000 in Thread.
In the same month, an investment was also made in Commonplace (GBP1.5m),
an online community consultation platform. Subsequent to this, GBP1.35m
was invested in April in Luxury Promise, the leading marketplace to buy,
sell and swap pre loved luxury goods. In June, the Company invested
GBP125,000 in ContactEngine, a pre-existing portfolio company.
In May 2020, the Company's holding in SPC International Limited was
sold. The Company received GBP544,000 in disposal proceeds.
Save for the impact of the Coronavirus pandemic, particularly on
performance and valuation of portfolio companies as well as potential
risks such as future fundraising, the risks faced by the Company have
remained unchanged since the beginning of the nancial year.
Announcement based on audited accounts
The financial information set out in this announcement does not
constitute the Company's statutory financial statements in accordance
with section 434 Companies Act 2006 for the year ended 29 February 2020,
but has been extracted from the statutory financial statements for the
year ended 29 February 2020, which were approved by the Board of
Directors on 1 July 2020 and will be delivered to the Registrar of
Companies following the Company's Annual General Meeting. The
Independent Auditor's Report on those financial statements was
unqualified and did not contain any emphasis of matter nor statements
under s 498(2) and (3) of the Companies Act 2006.
The statutory accounts for the year ended 28 February 2019 have been
delivered to the Registrar of Companies and received an Independent
Auditors report which was unqualified and did not contain any emphasis
of matter nor statements under S498(2) and (3) of the Companies Act
2006.
A copy of the full annual report and financial statements for the year
ended 29 February 2020 will be made available to Shareholders shortly.
Copies will be available for download from www.provenvcts.co.uk
- End
(END) Dow Jones Newswires
July 02, 2020 02:48 ET (06:48 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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