TIDMAAEV
Albion Enterprise VCT PLC
LEI Code 213800OVSRDHRJBMO720
As required by the UK Listing Authority's Disclosure Guidance
and Transparency Rule 4.2, Albion Enterprise VCT PLC today makes
public its information relating to the Half-yearly Financial Report
(which is unaudited) for the six months to 30 September 2021. This
announcement was approved by the Board of Directors on 30 November
2021.
The full Half-yearly Financial Report (which is unaudited) for
the period to 30 September 2021, will shortly be sent to
shareholders. Copies of the full Half-yearly Financial Report will
be shown via the Albion Capital Group LLP website by clicking
www.albion.capital/funds/AA
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EV/30Sep21.pdf
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.
Investment policy
Albion Enterprise VCT PLC (the "Company") is a Venture Capital
Trust and the investment objective of the Company is to provide
investors with a regular source of income, combined with the
prospect of longer term capital growth.
Investment policy
The Company will invest in a broad portfolio of higher growth
businesses across a variety of sectors of the UK economy including
higher risk technology companies. Allocation of assets will be
determined by the investment opportunities which become available
but efforts will be made to ensure that the portfolio is
diversified both in terms of sector and stage of maturity of
company.
VCT qualifying and non-VCT qualifying investments
Application of the investment policy is designed to ensure that
the Company continues to qualify and is approved as a VCT by HM
Revenue and Customs ("VCT regulations"). The maximum amount
invested in any one company is limited to any HMRC annual
investment limits. It is intended that normally at least 80 per
cent. of the Company's funds will be invested in VCT qualifying
investments. The VCT regulations also have an impact on the type of
investments and qualifying sectors in which the Company can make
investment.
Funds held prior to investing in VCT qualifying assets or for
liquidity purposes will be held as cash on deposit, invested in
floating rate notes or similar instruments with banks or other
financial institutions with high credit ratings or invested in
liquid open-ended equity funds providing income and capital equity
exposure (where it is considered economic to do so). Investment in
such open-ended equity funds will not exceed 10 per cent. of the
Company's assets at the time of investment.
Risk diversification and maximum exposures
Risk is spread by investing in a number of different businesses
within Venture Capital Trust qualifying industry sectors using a
mixture of securities. The maximum amount which the Company will
invest in a single company is 15 per cent. of the Company's assets
at cost, thus ensuring a spread of investment risk. The value of an
individual investment may increase over time as a result of trading
progress and it is possible that it may grow in value to a point
where it represents a significantly higher proportion of total
assets prior to a realisation opportunity being available.
Gearing
The Company's maximum exposure in relation to gearing is
restricted to 10 per cent. of its adjusted share capital and
reserves.
Financial calendar
Record date for second dividend 4 February 2022
Date of General Meeting Noon on 21 February 2022
Payment date for second dividend 28 February 2022
Financial year end 31 March
Financial highlights
Unaudited six months ended Unaudited six months ended Audited
30 September 2021 30 September 2020 year ended 31 March 2021
(pence per share) (pence per share) (pence per share)
---------- -------------------------- -------------------------- -------------------------
Opening
net asset
value 114.60 106.54 106.54
Capital
return 18.04 5.85 13.96
Revenue
loss (0.94) (0.20) (0.51)
-------------------------- -------------------------- -------------------------
Total
return 17.10 5.65 13.45
Dividends
paid (2.87) (2.70) (5.44)
Impact
from
share
capital
movements 0.02 0.06 0.05
-------------------------- -------------------------- -------------------------
Net asset
value 128.85 109.55 114.60
-------------------------- -------------------------- -------------------------
Total dividends paid to 30 September 2021 59.16
Net asset value on 30 September 2021 128.85
------
Total shareholder value to 30 September 2021 188.01
--------------------------------------------- ------
A more detailed breakdown of the dividends paid per year can be
found at www.albion.capital/funds/AAEV under the 'Dividend History'
section.
In addition to the dividends summarised above, the Board has
declared a second dividend for the year ending 31 March 2022, of
3.22 pence per share to be paid on 28 February 2022 to shareholders
on the register on 4 February 2022.
Interim management report
Introduction
Albion Enterprise VCT PLC (the "Company") has had a strong six
months to 30 September 2021, with a total return of 17.10 pence per
share, and the net asset value ("NAV") increasing to 128.85 pence
per share, representing a 14.9% return on opening NAV (after
adjusting for the dividend paid). Our portfolio companies continue
to show resilience and are demonstrating the value they provide to
their customers.
Valuations and results
The gain on investments for the six months to 30 September 2021
was GBP15.8 million compared to a gain of GBP4.5 million for the
same period in the previous year. The successful series D fundraise
in Quantexa and series C fundraise in Oviva have been the major
contributors to the positive return, alongside continuing growth
from Egress Technologies. We have also seen many of our other
portfolio companies performing well. For example, portfolio company
Arecor Therapeutics, listed onto the AIM stock exchange during the
period which led to an increase in value of GBP0.8 million. Our top
10 portfolio companies, which now account for 54% of NAV, increased
in value by GBP12.7 million. These excellent results for the six
months have resulted in a performance incentive fee accrual of
GBP2.1 million, however any performance incentive fee is calculated
on year end results.
There have also been some write-downs in our portfolio, the
largest being Abcodia (GBP0.4 million) which was impacted by
disappointing clinical trial results during the period.
Further details of the portfolio of investments can be found
below.
Dividends
In line with our variable dividend policy targeting a dividend
around 5% of NAV per annum, the Company paid a dividend totalling
2.87 pence per share during the period to 30 September 2021 (30
September 2020: 2.70 pence per share). The Company will pay a
second dividend for the financial year ending 31 March 2022 of 3.22
pence per share on 28 February 2022 to shareholders on the register
on 4 February 2022, being 2.5% of the latest reported NAV.
This will bring the total dividends paid for the year ending 31
March 2022 to 6.09 pence per share, which equates to a 5.3% yield
on the opening NAV of 114.60 pence per share.
Investment activity
During the period the Company has invested GBP5.2 million into
new and existing portfolio companies, with new investments
comprising:
-- GBP0.8 million into Gravitee TopCo (trading as Gravitee.io), an
application programming interface (API) management platform;
-- GBP0.6 million into NuvoAir, a provider of digital therapeutics and
decentralised clinical trials for respiratory conditions;
-- GBP0.3 million into Brytlyt, which uses patented software and AI,
combined with the superior computation power of graphics processing units
(GPUs), to derive insights thousands of times faster than legacy systems;
and
-- GBP0.3 million into Accelex Technologies, a data extraction and analytics
technology for private capital markets.
A further GBP3.2 million was invested in supporting our existing
portfolio companies, including GBP1.4 million into Oviva, as part
of the Series C fundraise, and GBP0.5 million into uMotif, to
support the business as it continues to develop its electronic
patient report platform for clinical trials.
Investment portfolio by sector
The pie chart at the end of this announcement shows the
different sectors in which the Company's assets, at carrying value,
were invested on 30 September 2021.
Cancellation of share premium and capital redemption reserve
Given the current level of distributable reserves and the
Board's dividend policy, by way of a General Meeting, the Board is
proposing a special resolution to increase the Company's
distributable reserves through a reduction of the Company's share
premium account and capital redemption reserve, subject to
shareholder approval and confirmation by the Court. This procedure
is relatively common amongst investment companies, and the proposed
resolution would create additional distributable reserves of
approximately GBP54 million.
It is the Board's policy to pay regular dividends to
shareholders as the Directors believe that this is a key source of
shareholder value. The Company also has a policy of buying back its
own shares for cancellation or for holding as treasury shares, when
such purposes are considered to be to the advantage of the Company
and shareholders as a whole. The additional distributable reserves
will facilitate those objectives.
The General Meeting will be held at noon on 21 February 2022 at
the Company's registered office, 1 Benjamin Street, London, EC1M
5QL. The General Meeting will be live streamed for shareholders and
registration details will be available at
www.albion.capital/funds/AAEV prior to the Meeting.
The Board has carefully considered the business to be approved
at the General Meeting and recommends shareholders to vote in
favour of the resolution which will be proposed. Shareholders can
submit their questions to the Board in advance of the General
Meeting up until noon on 17 February 2022 by emailing
AAEVchair@albion.capital
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.
Further details of the General Meeting can be found in the
Circular accompanying this Half-yearly Financial Report.
Board composition
The Dowager Lady Balfour of Burleigh retired from the board on
11 August 2021. The Board thanks her for her wise counsel and will
miss her invaluable mix of skills over many years. It was a
pleasure to have worked with her. On 1 September 2021, Pippa Latham
joined the Board. Pippa brings extensive experience across the
financial sector as well as Board membership of a variety of
successful technology and other commercial organisations. She is a
Cambridge graduate, holds an MBA from INSEAD and is both a
qualified accountant and a member of the Institute of Chartered
Secretaries and Administrators. The Board believes that Pippa will
add considerable value during her tenure.
Share buy-backs
It remains the Board's policy to buy-back shares in the market,
subject to the overall constraint that such purchases are in the
Company's interest. This includes the maintenance of sufficient
cash resources for investment in new and existing portfolio
companies and the continued payment of dividends to
shareholders.
It is the Board's intention that such buy-backs should be at
around a 5% discount to net asset value, in so far as market
conditions and liquidity permit.
Transactions with the Manager
Details of transactions with the Manager for the reporting
period can be found in note 5. Details of related party
transactions can be found in note 11.
Principal risks and uncertainties
The longer term implications of the Covid-19 crisis is the key
risk facing the Company, including its impact on the UK and Global
economies. The increasing maturity and success of some of our
portfolio companies has resulted in a high concentration in our top
10, which may result in further volatility in the future.
In accordance with DTR 4.2.7, the Board confirms that the
principal risks and uncertainties facing the Company have not
materially changed from those identified in the Annual Report and
Financial Statements for the year ended 31 March 2021.The
occurrence of the Covid-19 pandemic has created heightened
uncertainty, but has not changed the nature of the principal risks.
The Board considers that the present processes for mitigating those
risks remain appropriate.
The principal risks faced by the Company are:
-- Investment, performance and valuation risk;
-- VCT approval risk;
-- Regulatory and compliance risk;
-- Operational and internal control risk;
-- Economic, political and social risk;
-- Emerging risks;
-- Market value of Ordinary shares; and
-- Reputational risk.
A detailed explanation of the principal risks facing the Company
can be found in the Annual Report and Financial Statements for the
year ended 31 March 2021 on pages 18 to 20, copies of which are
available on the Company's webpage on the Manager's website at
www.albion.capital/funds/AAEV under the 'Financial Reports and
Circulars' section.
Albion VCTs Top Up Offers
Your Board, in conjunction with the boards of the other five
VCTs managed by Albion Capital Group LLP, have announced to the
market the intention of the VCTs to launch prospectus top up offers
of new ordinary shares for subscription in the 2021/2022 and
2022/2023 tax years. The prospectus is expected to be published in
early January 2022, with more information available at
www.albion.capital.
The proceeds will be used to provide support to our existing
portfolio companies and to enable us to take advantage of new and
exciting investment opportunities as they arise, four of which are
detailed above.
To ensure efficient Shareholder communication the Board is
actively encouraging Shareholders who are currently receiving hard
copy information to change their preferences to electronic
communications. There are many reasons why we think this is the
right thing to do including being more environmentally friendly,
less human contact, and speed including the immediacy of getting
information to you regarding the Company and new Offers.
Shareholders can sign up for e-Comms by going to:
www.investorcentre.co.uk/ecomms.
Prospects
The Board is encouraged by the performance of the portfolio as a
whole, and the pipeline of new and follow on investments continues
to remain strong, demonstrated by the GBP5.2m invested in 10
investments in the past six months. The Company has seen GBP9.2
million of gains in its top three portfolio companies in addition
to GBP6.5 million of gains across the rest of the portfolio. We
therefore believe that the Company's portfolio is suitably balanced
and continues to have the potential to deliver attractive returns
to shareholders over the long term.
Maxwell Packe
Chairman
30 November 2021
Responsibility statement
The Directors, Maxwell Packe, Christopher Burrows, Rhodri
Whitlock, Pippa Latham and Patrick Reeve, are responsible for
preparing the Half-yearly Financial Report. In preparing these
condensed Financial Statements for the period to 30 September 2021
we, the Directors of the Company, confirm that to the best of our
knowledge:
(a) the condensed set of Financial Statements, which has been prepared in accordance with Financial Reporting Standard 104 "Interim Financial Reporting", give a true and fair view of the assets, liabilities, financial position and profit and loss of the Company as required by DTR 4.2.4R;
(b) the Interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year); and
(c) the Interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).
This Half-yearly Financial Report has not been audited or
reviewed by the Auditor.
For and on behalf of the Board
Maxwell Packe
Chairman
30 November 2021
Portfolio of investments
On 30 September 2021
Cumulative movement Change in
Fixed asset % voting Cost in value Value value for the period(*)
investments rights GBP'000 GBP'000 GBP'000 GBP'000
---------------------- -------- -------- -------- ------------------------
Quantexa Limited 2.5 2,108 12,422 14,530 7,684
Egress Software
Technologies Limited 9.9 3,365 8,596 11,961 1,007
Proveca Limited 9.6 1,512 4,648 6,160 546
Oviva AG 2.8 2,601 2,618 5,219 2,320
Radnor House School
(TopCo) Limited 9.4 1,729 1,877 3,606 626
The Evewell Group
Limited 6.1 1,477 957 2,434 (25)
Phrasee Limited 3.6 822 1,320 2,142 -
Regenerco Renewable
Energy Limited 12.5 1,261 776 2,037 4
Black Swan Data
Limited 5.0 1,445 346 1,791 488
Healios Limited 4.0 1,134 522 1,656 -
The Street by Street
Solar Programme
Limited 8.6 891 685 1,576 16
Threadneedle Software
Holdings Limited (T/A
Solidatus) 2.2 1,360 - 1,360 -
Arecor Therapeutics
PLC (previously
Arecor Limited) 1.1 400 929 1,329 756
Alto Prodotto Wind
Limited 11.1 814 463 1,277 (32)
MPP Global Solutions
Limited 2.9 950 311 1,261 311
Panaseer Limited 2.3 816 388 1,204 1
Greenenerco Limited 28.6 739 453 1,192 (28)
Elliptic Enterprises
Limited 1.0 792 398 1,190 398
uMotif Limited 3.8 1,109 60 1,169 -
Credit Kudos Limited 2.1 454 696 1,150 696
Aridhia Informatics
Limited 6.4 1,244 (109) 1,135 223
Cantab Research
Limited (T/A
Speechmatics) 1.7 696 344 1,040 344
Convertr Media Limited 6.2 992 38 1,030 5
Oxsensis Limited 4.3 1,011 (8) 1,003 -
MyMeds&Me Limited 7.6 720 216 936 13
Beddlestead Limited 8.1 966 (69) 897 241
Innovation Broking
Group Limited 8.4 84 760 844 266
Koru Kids Limited 2.5 541 302 843 245
Cisiv Limited 8.8 799 (32) 767 -
DySIS Medical Limited 3.8 2,742 (1,978) 764 12
Gravitee TopCo Limited
(T/A Gravitee.io) 3.5 763 - 763 -
Concirrus Limited 1.5 755 - 755 -
InCrowd Sports Limited 3.9 499 184 683 13
NuvoAir Holdings Inc. 2.1 649 - 649 -
The Voucher Market Ltd
(T/A WeGift) 1.4 564 - 564 -
Locum's Nest Limited 4.8 500 30 530 61
Limitless Technology
Limited 1.8 471 47 518 -
Imandra Inc. 1.3 173 261 434 261
Zift Channel Solutions
Inc. 2.0 1,053 (628) 425 181
Seldon Technologies
Limited 1.9 371 - 371 -
Brytlyt Limited 1.8 310 - 310 -
Accelex Technology
Limited 2.9 265 - 265 -
AVESI Limited 5.5 179 61 240 (1)
TransFICC Limited 1.6 234 - 234 -
memsstar Limited 8.8 192 42 234 (135)
Xperiome Limited
(previously
Raremark) 3.4 448 (312) 136 (227)
uMedeor Limited (T/A
uMed) 1.3 134 - 134 -
MHS 1 Limited 1.2 83 (15) 68 (5)
Symetrica Limited 0.2 55 (11) 44 -
Sandcroft Avenue
Limited (T/A Hussle) 6.8 1,370 (1,354) 16 (125)
Avora Limited 2.4 430 (420) 10 (152)
Forward Clinical
Limited (T/A Pando) 1.8 219 (212) 7 (1)
Abcodia Limited 5.6 987 (983) 4 (368)
Mirada Medical Limited 14.2 1,487 (1,487) - -
------------------------
Total fixed asset
investments 47,765 33,132 80,897 15,619
---------------------- -------- -------- ------------------- -------- ------------------------
* as adjusted for additions and disposals during the period;
including realised gains/(losses).
Opening Disposal Total Gain on
Investment realisations in the period to 30 September Cost carrying value proceeds realised gain opening value
2021 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------------------------------------ -------- --------------- --------- -------------- --------------
Loan stock repayments and other:
------------------------------------------------------
Greenenerco Limited 29 42 42 13 -
Alto Prodotto Wind Limited 27 41 41 14 -
Escrow adjustments* - - 131 131 131
Total fixed asset realisations 56 83 214 158 131
------------------------------------------------------ -------- --------------- --------- -------------- --------------
* These comprise fair value movements on deferred consideration
on previously disposed investments, release of the G.Network
Communications discount which is treated as a financing
transaction, and expenses which are incidental to the purchase or
disposal of an investment.
Total change in value of investments for the period 15,619
Movement in loan stock accrued interest 2
------
Unrealised gains on fixed asset investments 15,621
Realised gains on fixed asset investments 131
Total gains on investments as per Income statement 15,752
----------------------------------------------------- ------
Condensed income statement
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2021 30 September 2020 31 March 2021
---------------------------------------------------------- ---- ------------------------------- ------------------------------- -------------------------------
Revenue Capital Revenue Capital Revenue Capital
Note GBP'000 GBP'000 Total GBP'000 GBP'000 GBP'000 Total GBP'000 GBP'000 GBP'000 Total GBP'000
---- ------- ------- ------------- ------- ------- ------------- ------- ------- -------------
Gains on investments 3 - 15,752 15,752 - 4,501 4,501 - 10,892 10,892
Investment income 4 297 - 297 266 - 266 543 - 543
Investment Manager's fees 5 (755) (2,266) (3,021) (171) (513) (684) (438) (1,314) (1,752)
Other expenses (250) - (250) (231) - (231) (454) - (454)
------- ------- ------------- ------- ------- ------------- ------- ------- -------------
(Loss)/return on ordinary activities before taxation (708) 13,486 12,778 (136) 3,988 3,852 (349) 9,578 9,229
Tax on ordinary activities - - - - - - - - -
------- ------- ------------- ------- ------- ------------- ------- ------- -------------
(Loss)/return and total comprehensive income attributable
to shareholders (708) 13,486 12,778 (136) 3,988 3,852 (349) 9,578 9,229
------- ------- ------------- ------- ------- ------------- ------- ------- -------------
Basic and diluted (loss)/return per share (pence)* 7 (0.94) 18.04 17.10 (0.20) 5.85 5.65 (0.51) 13.96 13.45
---- ------- ------- ------------- ------- ------- ------------- ------- ------- -------------
* adjusted for treasury shares
The accompanying notes below form an integral part of this
Half-yearly Financial Report.
Comparative figures have been extracted from the unaudited
Half-yearly Financial Report for the six months ended 30 September
2020 and the audited statutory accounts for the year ended 31 March
2021.
The total column of this Condensed income statement represents
the profit and loss account of the Company. The supplementary
revenue and capital columns have been prepared in accordance with
The Association of Investment Companies' Statement of Recommended
Practice.
Condensed balance sheet
Unaudited Unaudited Audited
30 September 2021 30 September 2020 31 March 2021
Note GBP'000 GBP'000 GBP'000
---------------- ---- ------------------ ------------------ --------------
Fixed asset
investments 80,897 55,871 60,615
Current assets
Current asset
investments - 3,602 -
Trade and other
receivables 2,304 178 1,772
Cash and cash
equivalents 15,758 15,542 24,429
------------------ ------------------ --------------
18,062 19,322 26,201
Total assets 98,959 75,193 86,816
Payables
Trade and other
payables less
than one year (2,911) (913) (1,418)
------------------ ------------------ --------------
Total assets
less current
liabilities 96,048 74,280 85,398
------------------ ------------------ --------------
Equity
attributable to
equity holders
Called-up share
capital 8 859 775 852
Share premium 54,009 44,679 53,258
Capital
redemption
reserve 104 104 104
Unrealised
capital
reserve 33,133 13,075 17,538
Realised capital
reserve 12,619 13,601 14,728
Other
distributable
reserve (4,676) 2,046 (1,082)
------------------ ------------------ --------------
Total equity
shareholders'
funds 96,048 74,280 85,398
------------------ ------------------ --------------
Basic and
diluted net
asset value per
share (pence)* 128.85 109.55 114.60
* excluding treasury shares
The accompanying notes below form an integral part of this
Half-yearly Financial Report.
Comparative figures have been extracted from the unaudited
Half-yearly Financial Report for the six months ended 30 September
2020 and the audited statutory accounts for the year ended 31 March
2021.
These Financial Statements were approved by the Board of
Directors, and authorised for issue on 30 November 2021 and were
signed on its behalf by
Maxwell Packe
Chairman
Company number: 05990732
Condensed statement of changes in equity
Called-up Share Unrealised Realised Other distributable
share capital premium Capital redemption reserve capital reserve capital reserve* reserve* Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------------------------- -------------- -------- -------------------------- ---------------- ----------------- ------------------- --------
As at 1 April 2021 852 53,258 104 17,538 14,728 (1,082) 85,398
Return/(loss) and total comprehensive income for the
period - - - 15,621 (2,135) (708) 12,778
Transfer of previously unrealised gains on disposal
of investments - - - (26) 26 - -
Issue of equity 7 778 - - - - 785
Cost of issue of equity - (27) - - - - (27)
Purchase of own shares for treasury - - - - - (747) (747)
Dividends paid - - - - - (2,139) (2,139)
As at 30 September 2021 859 54,009 104 33,133 12,619 (4,676) 96,048
----------------------------------------------------- -------------- -------- -------------------------- ---------------- ----------------- ------------------- --------
As at 1 April 2020 770 44,183 104 8,636 14,052 4,808 72,553
Return/(loss) and total comprehensive income for the
period - - - 4,464 (476) (136) 3,852
Transfer of previously unrealised gains on disposal
of investments - - - (25) 25 - -
Issue of equity 5 502 - - - - 507
Cost of issue of equity - (6) - - - - (6)
Purchase of own shares for treasury - - - - - (790) (790)
Dividends paid - - - - - (1,836) (1,836)
As at 30 September 2020 775 44,679 104 13,075 13,601 2,046 74,280
----------------------------------------------------- -------------- -------- -------------------------- ---------------- ----------------- ------------------- --------
As at 1 April 2020 770 44,183 104 8,636 14,052 4,808 72,553
Return/(loss) and total comprehensive income for the
year - - - 8,836 742 (349) 9,229
Transfer of previously unrealised losses on disposal
of investments - - - 66 (66) - -
Issue of equity 82 9,277 - - - - 9,359
Cost of issue of equity - (202) - - - - (202)
Purchase of own shares for treasury - - - - - (1,853) (1,853)
Dividends paid - - - - - (3,688) (3,688)
As at 31 March 2021 852 53,258 104 17,538 14,728 (1,082) 85,398
----------------------------------------------------- -------------- -------- -------------------------- ---------------- ----------------- ------------------- --------
* These reserves amount to GBP7,943,000 (30 September 2020:
GBP15,647,000; 31 March 2021: GBP13,646,000) which is considered
distributable.
Condensed statement of cash flows
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2021 30 September 2020 31 March 2021
GBP'000 GBP'000 GBP'000
----------------------------- ------------------ ------------------ --------------
Cash flow from operating
activities
Investment income received 298 211 434
Dividend income received - 42 94
Deposit interest received 1 16 17
Investment Manager's fees
paid (1,224) (710) (1,403)
Other cash payments (271) (268) (465)
Net cash flow from operating
activities (1,196) (709) (1,323)
Cash flow from investing
activities
Disposal of current asset
investments - - 3,691
Purchase of fixed asset
investments (5,173) (3,745) (7,324)
Disposal of fixed asset
investments 112 139 3,683
Net cash flow from investing
activities (5,061) (3,606) 50
Cash flow from financing
activities
Issue of share capital 430 205 8,568
Cost of issue of equity (16) (17) (17)
Dividends paid* (1,792) (1,535) (3,094)
Purchase of own shares
(including costs) (1,036) (306) (1,265)
Net cash flow from financing
activities (2,414) (1,653) 4,192
(Decrease)/increase in cash
and cash equivalents (8,671) (5,968) 2,919
Cash and cash equivalents at
start of the period 24,429 21,510 21,510
------------------ ------------------ --------------
Cash and cash equivalents at
end of the period 15,758 15,542 24,429
------------------ ------------------ --------------
*The dividends paid shown in the cash flow are different to the
dividends disclosed in note 6 as a result of the non-cash effect of
the Dividend Reinvestment Scheme.
Notes to the condensed Financial Statements
1. Accounting convention
The Financial Statements have been prepared in accordance with
applicable United Kingdom law and accounting standards, including
Financial Reporting Standard 102 ("FRS 102"), and with the
Statement of Recommended Practice "Financial Statements of
Investment Trust Companies and Venture Capital Trusts" ("SORP")
issued by The Association of Investment Companies ("AIC"). The
Financial Statements have been prepared on a going concern
basis.
The preparation of the Financial Statements requires management
to make judgements and estimates that affect the application of
policies and reported amounts of assets, liabilities, income and
expenses. The most critical estimates and judgements relate to the
determination of carrying value of investments at Fair Value
Through Profit and Loss ("FVTPL") in accordance with FRS 102
sections 11 and 12. The Company values investments by following the
International Private Equity and Venture Capital Valuation ("IPEV")
Guidelines as updated in 2018 and further detail on the valuation
techniques used are outlined in note 2 below.
Company information can be found on page 2 of the full
Half-yearly Financial Report.
2. Accounting policies
Fixed and current asset investments
The Company's business is investing in financial assets with a
view to profiting from their total return in the form of income and
capital growth. This portfolio of financial assets is managed and
its performance evaluated on a fair value basis, in accordance with
a documented investment policy, and information about the portfolio
is provided internally on that basis to the Board.
In accordance with the requirements of FRS 102, those
undertakings in which the Company holds more than 20 per cent. of
the equity as part of an investment portfolio are not accounted for
using the equity method. In these circumstances the investment is
measured at FVTPL.
Upon initial recognition (using trade date accounting)
investments, including loan stock, are classified by the Company as
FVTPL and are included at their initial fair value, which is cost
(excluding expenses incidental to the acquisition which are written
off to the Income statement).
Subsequently, the investments are valued at 'fair value', which
is measured as follows:
-- Investments listed on recognised exchanges are valued at their bid prices
at the end of the accounting period or otherwise at fair value based on
published price quotations.
-- Unquoted investments, where there is not an active market, are valued
using an appropriate valuation technique in accordance with the IPEV
Guidelines. Indicators of fair value are derived using established
methodologies including earnings multiples, revenue multiples, the level
of third party offers received, cost or price of recent investment rounds,
net assets and industry valuation benchmarks. Where price of recent
investment is used as a starting point for estimating fair value at
subsequent measurement dates, this has been benchmarked using an
appropriate valuation technique permitted by the IPEV guidelines.
-- In situations where cost or price of recent investment is used,
consideration is given to the circumstances of the portfolio company
since that date in determining fair value. This includes consideration of
whether there is any evidence of deterioration or strong definable
evidence of an increase in value. In the absence of these indicators, the
investment in question is valued at the amount reported at the previous
reporting date. Examples of events or changes that could indicate a
diminution include:
-- the performance and/or prospects of the underlying business are
significantly below the expectations on which the investment was
based;
-- a significant adverse change either in the portfolio company's
business or in the technological, market, economic, legal or
regulatory environment in which the business operates; or
-- market conditions have deteriorated, which may be indicated by a
fall in the share prices of quoted businesses operating in the
same or related sectors.
Investments are recognised as financial assets on legal
completion of the investment contract and are de-recognised on
legal completion of the sale of an investment.
Dividend income is not recognised as part of the fair value
movement of an investment, but is recognised separately as
investment income through the other distributable reserve when a
share becomes ex-dividend.
Current assets and payables
Receivables (including debtors due after more than one year),
payables and cash are carried at amortised cost, in accordance with
FRS 102. Debtors due after more than one year meet the definition
of a financing transaction held at amortised cost, and interest
will be recognised through capital over the credit period using the
effective interest method. There are no financial liabilities other
than payables.
Investment income
Equity income
Dividend income is included in revenue when the investment is
quoted ex-dividend.
Unquoted loan stock income
Fixed returns on non-equity shares and debt securities are
recognised when the Company's right to receive payment and expect
settlement is established. Where interest is rolled up and/or
payable at redemption then it is recognised as income unless there
is reasonable doubt as to its receipt.
Bank interest income
Interest income is recognised on an accruals basis using the
rate of interest agreed with the bank.
Investment management fee, performance incentive fee and
expenses
All expenses have been accounted for on an accruals basis.
Expenses are charged through the other distributable reserve except
the following which are charged through the realised capital
reserve:
-- 75 per cent. of management fees and performance incentive fees, if any,
are allocated to the realised capital reserve. This is in line with the
Board's expectation that over the long term 75 per cent. of the Company's
investment returns will be in the form of capital gains; and
-- expenses which are incidental to the purchase or disposal of an
investment are charged through the realised capital reserve.
Taxation
Taxation is applied on a current basis in accordance with FRS
102. Current tax is tax payable/(refundable) in respect of the
taxable profit/(tax loss) for the current period or past reporting
periods using the tax rates and laws that have been enacted or
substantively enacted at the financial reporting date. Taxation
associated with capital expenses is applied in accordance with the
SORP.
Deferred tax is provided in full on all timing differences at
the reporting date. Timing differences are differences between
taxable profits and total comprehensive income as stated in the
Financial Statements that arise from the inclusion of income and
expenses in tax assessments in periods different from those in
which they are recognised in the Financial Statements. As a VCT the
Company has an exemption from tax on capital gains. The Company
intends to continue meeting the conditions required to obtain
approval as a VCT in the foreseeable future. The Company therefore,
should have no material deferred tax timing differences arising in
respect of the revaluation or disposal of investments and the
Company has not provided for any deferred tax.
Share capital and reserves
Called-up share capital
Called-up share capital accounts for the nominal value of the
Company's shares.
Share premium
This reserve accounts for the difference between the price paid
for the Company's shares and the nominal value of those shares,
less issue costs and transfers to the other distributable
reserve.
Capital redemption reserve
This reserve accounts for amounts by which the issued share
capital is diminished through the repurchase and cancellation of
the Company's own shares.
Unrealised capital reserve
Increases and decreases in the valuation of investments held at
the year end against cost are included in this reserve.
Realised capital reserve
The following are disclosed in this reserve:
-- gains and losses compared to cost on the realisation of investments, or
permanent diminutions in value;
-- expenses, together with the related taxation effect, charged in
accordance with the above policies; and
-- dividends paid to equity holders where paid out by capital.
Other distributable reserve
The special reserve, treasury share reserve and the revenue
reserve were combined in 2013 to form a single reserve named other
distributable reserve.
This reserve accounts for movements from the revenue column of
the Income statement, the payment of dividends, the buy-back of
shares and other non-capital realised movements.
Dividends
Dividends by the Company are accounted for in the period in
which the dividend is paid or approved at the Annual General
Meeting.
Segmental reporting
The Directors are of the opinion that the Company is engaged in
a single operating segment of business, being investment in smaller
companies principally based in the UK.
3. Gains on investments
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2021 30 September 2020 31 March 2021
GBP'000 GBP'000 GBP'000
----------------------
Unrealised gains on
fixed asset
investments 15,621 4,363 8,836
Unrealised gains on
current asset
investments - 101 -
Realised gains on
fixed asset
investments 131 37 1,866
Realised gains on
current asset
investments - - 190
------------------ ------------------ --------------
15,752 4,501 10,892
------------------ ------------------ --------------
4. Investment income
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2021 30 September 2020 31 March 2021
GBP'000 GBP'000 GBP'000
----------------------
Loan stock interest 296 209 434
Dividend income - 42 94
Bank deposit interest 1 15 15
297 266 543
------------------ ------------------ --------------
5. Investment Manager's fees
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2021 30 September 2020 31 March 2021
GBP'000 GBP'000 GBP'000
----------------------
Investment management
fee charged to
revenue 227 171 366
Investment management
fee charged to
capital 680 513 1,098
Performance incentive
fee charged to
revenue 528 - 72
Performance incentive
fee charged to
capital 1,586 - 216
------------------ ------------------ --------------
3,021 684 1,752
------------------ ------------------ --------------
Further details of the Management agreement under which the
investment management fee and performance incentive fee are paid is
given in the Strategic report on page 14 of the Annual Report and
Financial Statements for the year ended 31 March 2021.
During the period, services of a total value of GBP998,000 (30
September 2020: GBP757,000; 31 March 2021: GBP1,905,000) were
purchased by the Company from Albion Capital Group LLP; this
includes GBP907,000 (30 September 2020: GBP684,000; 31 March 2021:
GBP1,464,000) of management fee and GBP91,000 (30 September 2020:
GBP73,000; 31 March 2021: GBP153,000) of administration fee. At the
financial period end, the amount due to Albion Capital Group LLP in
respect of these services disclosed within payables was GBP428,000
(30 September 2020: GBP359,000; 31 March 2021: GBP453,000). For the
period to 30 September 2021, a performance incentive fee of
GBP2,114,000 has been accrued, however any performance incentive
fee is calculated on year end results and payable in line with the
Management agreement (30 September 2020: GBPnil; 31 March 2021:
GBP288,000).
During the period, the Company was not charged by Albion Capital
Group LLP in respect of Patrick Reeve's services as a Director (30
September 2020: GBPnil; 31 March 2021: GBPnil).
Albion Capital Group LLP, its partners and staff (including
Patrick Reeve) hold a total of 543,037 shares in the Company on 30
September 2021.
Albion Capital Group LLP is, from time to time, eligible to
receive arrangement fees and monitoring fees from portfolio
companies. During the period to 30 September 2021, fees of
GBP108,000 attributable to the investments of the Company were
received pursuant to these arrangements (30 September 2020:
GBP89,000; 31 March 2021: GBP205,000).
6. Dividends
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2021 30 September 2020 31 March 2021
GBP'000 GBP'000 GBP'000
-------------------------------------------------------
First dividend of 2.87p per share paid on 31 August
2021 (28 August 2020: 2.70p per share) 2,139 1,836 1,836
Second dividend of 2.74p per share paid on 26 February
2021 - - 1,854
Unclaimed dividends - - (2)
2,139 1,836 3,688
------------------ ------------------ --------------
In addition to the dividends summarised above, the Board has
declared a second dividend for the year ending 31 March 2022 of
3.22 pence per share which will be paid on 28 February 2022 to
shareholders on the register on 4 February 2022. This is expected
to amount to approximately GBP2,400,000.
7. Basic and diluted (loss)/return per share
Unaudited Unaudited Audited
six months ended six months ended year ended
30 September 2021 30 September 2020 31 March 2021
Revenue Capital Revenue Capital Revenue Capital
--------------
(Loss)/return
attributable
to equity
shares
(GBP'000) (708) 13,486 (136) 3,988 (349) 9,578
Weighted
average
shares in
issue 74,745,677 68,156,133 68,620,876
(Loss)/return
per Ordinary
share
(pence) (0.94) 18.04 (0.20) 5.85 (0.51) 13.96
The weighted average number of shares is calculated after
adjusting for treasury shares of 11,346,766 (30 September 2020:
9,717,736; 31 March 2021: 10,713,420).
There are no convertible instruments, derivatives or contingent
share agreements in issue for the Company, therefore no dilution
affecting the return per share. The basic return per share is
therefore the same as the diluted return per share.
8. Called-up share capital
Allotted, called-up and fully paid shares of 1 penny Unaudited Unaudited 30 Audited
each 30 September 2021 September 2020 31 March 2021
-----------------------------------------------------
Number of shares 85,891,086 77,523,553 85,232,100
Nominal value of allotted shares (GBP'000) 859 775 852
Voting rights (number of shares net of treasury
shares) 74,544,320 67,805,817 74,518,680
During the period to 30 September 2021, the Company purchased
633,346 shares (30 September 2020: 772,422; 31 March 2021:
1,768,106) to be held in treasury at a nominal value of GBP6,333
and at a cost of GBP747,000. The total number of shares held in
treasury on 30 September 2021 was 11,346,766 (30 September 2020:
9,717,736; 31 March 2021: 10,713,420) representing 13.2% of the
shares in issue on 30 September 2021.
Under the terms of the Dividend Reinvestment Scheme Circular
(dated 26 November 2009), the following new shares of nominal value
1 penny each were allotted during the period to 30 September
2021:
Number
of Issue price Net
Date of shares Aggregate nominal value of shares (pence per invested Opening market price on allotment date (pence per
allotment allotted GBP'000 share) GBP'000 share)
31 August
2021 275,632 3 125.06 327 119.50
Under the terms of the Albion VCTs Prospectus Top Up Offers
2020/21, the following new shares of nominal value 1 penny each
were allotted during the period to 30 September 2021:
Number
of Issue price
Date of shares Aggregate nominal value of shares (pence per Net consideration received Opening market price on allotment date (pence per
allotment allotted GBP'000 share) GBP'000 share)
----------
9 April
2021 144,118 1 114.00 162 106.50
9 April
2021 9,249 - 114.60 10 106.50
9 April
2021 229,987 2 115.20 258 106.50
383,354 430
-------- --------------------------
9. Commitments and contingencies
On 30 September 2021, the Company had no financial commitments
in respect of investments (30 September 2020: GBPnil; 31 March
2021: GBPnil).
There were no contingencies or guarantees of the Company on 30
September 2021 (30 September 2020: GBPnil; 31 March 2021:
GBPnil).
10. Post balance sheet events
The following are the material post balance sheet events since
30 September 2021:
-- Proceeds of GBP1,261,000 received from the sale of MPP Global Solutions
Limited on a cost of GBP950,000; and
-- Investment of GBP426,000 in an existing portfolio company, Elliptic
Enterprises Limited, a provider of Anti Money Laundering services to
digital asset institutions.
11. Related party transactions
Other than transactions with the Manager as disclosed in note 5,
there are no other related party transactions or balances requiring
disclosure.
12. Going concern
The Board has conducted a detailed assessment of the Company's
ability to meet its liabilities as they fall due. Cash flow
forecasts are updated and discussed quarterly at Board level and
have been stress tested to allow for the forecasted impact of
Coronavirus (Covid-19). The Board have revisited and updated their
assessment of liquidity risk and concluded that it remains
unchanged since the last Annual Report and Financial Statements.
Further details can be found on page 67 of those accounts.
The portfolio of investments is diversified in terms of sector
and the major cash outflows of the Company (namely investments,
dividends and share buy-backs) are within the Company's control.
Accordingly, after making diligent enquiries, the Directors have a
reasonable expectation that the Company has adequate cash and
liquid resources to continue in operational existence for the
foreseeable future. For this reason, the Directors have adopted the
going concern basis in preparing this Half-yearly Financial Report
and this is in accordance with the Guidance on Risk Management,
Internal Control and Related Financial and Business Reporting
issued by the Financial Reporting Council in September 2014, and
the subsequent updated Going concern, risk and viability guidance
issued by the FRC due to Covid-19 in 2020.
13. Other information
The information set out in this Half-yearly Financial Report
does not constitute the Company's statutory accounts within the
terms of section 434 of the Companies Act 2006 for the periods
ended 30 September 2021 and 30 September 2020, and is unaudited.
The information for the year ended 31 March 2021 does not
constitute statutory accounts within the terms of section 434 of
the Companies Act 2006 but is derived from the statutory accounts
for the financial year, which have been delivered to the Registrar
of Companies. The Auditor reported on those accounts; their report
was unqualified and did not contain statements under s498 (2) or
(3) of the Companies Act 2006.
14. Publication
This Half-yearly Financial Report is being sent to shareholders
and copies will be made available to the public at the registered
office of the Company, Companies House, the National Storage
Mechanism and also electronically at www.albion.capital/funds/AAEV,
where the Report can be accessed from the 'Financial Reports and
Circulars' section.
Attachment
-- AAEV pie chart for announcement 30 Sep 2021
https://ml-eu.globenewswire.com/Resource/Download/a0ae91dc-a47b-4e4f-8fc5-e52242b7b991
(END) Dow Jones Newswires
November 30, 2021 04:38 ET (09:38 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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