TIDMMIG1
RNS Number : 1826A
Maven Income & Growth VCT PLC
24 May 2019
Maven Income and Growth VCT PLC
Final results for the year ended 28 February 2019
The Directors are pleased to report the Company's financial
results for the year ended 28 February 2019.
Highlights
-- NAV total return at year end of 142.67p per share (2018: 140.56p)
-- NAV at year end of 47.76p per share (2018: 58.20p), after
payment of dividends totalling 12.55p per share during the year
-- Annual dividends of 12.55p per share (2018: 5.66p)
-- Offer for Subscription fully subscribed, with GBP20 million of new capital raised
-- 38,112,053 new shares allotted on 6 March 2019, with a final
allotment of 3,049,148 new shares on 24 April 2019
-- Completion of 16 VCT qualifying new and follow-on investments
Chairman's Statement
On behalf of your Board, I am pleased to report on another year
of positive progress for your Company. During the period under
review, NAV total return increased to 142.67p per share,
representing the tenth consecutive year of growth. This encouraging
performance reflects the strength of the underlying portfolio,
where positive trading by a number of private company holdings has
merited an uplift in valuation. Your Board is also pleased to
report on the successful completion of the Offer for Subscription,
which closed shortly after the period end, fully subscribed, having
raised GBP20 million of new capital. This additional liquidity will
support the continued expansion of the portfolio, through
investment in a range of carefully selected VCT qualifying growth
companies. Dividend payments during the year totalled 12.55p per
share, reflecting the build-up of distributable reserves following
a number of profitable exits, and the requirement to maintain
compliance with the VCT regulations. Whilst it is unlikely that
this level of distribution will be maintained, your Board remains
committed to making tax-free distributions whenever possible.
On 26 September 2018, your Company launched a new Offer for
Subscription to raise up to GBP15 million, with an over-allotment
facility for up to a further GBP5 million. Following strong early
investor demand, the over-allotment facility was opened on 23
January 2019 and, on 7 March 2019, the Directors were pleased to
announce that the Offer had closed early, at full subscription,
having raised a total of GBP20 million. This new capital provides
your Company with a level of liquidity that will facilitate the
continued expansion of the portfolio by investing in a wide range
of qualifying growth companies that each offer the prospect of a
capital gain.
Following enactment of the Finance Act 2015, which altered the
investment parameters for VCT qualifying transactions, Maven has
successfully adapted its deal origination strategy and
significantly expanded its investment team and nationwide presence,
providing access to a wide range of qualifying opportunities.
During the financial year, your Company achieved a good level of
investment activity, despite the protracted process for securing
Advance Assurance from HM Revenue and Customs (HMRC), which has
continued to cause delays to the completion of certain investments.
Based on the pipeline of live transactions currently under review,
your Board anticipates that the Company can sustain a healthy rate
of investment in the new financial year, supplemented by follow-on
commitments to support existing portfolio companies that are making
identifiable commercial progress. Given the increased liquidity
resulting from the Offer for Subscription, it is also possible that
your Company may make a number of investments in qualifying AIM
quoted companies, as Maven has an established team with specialist
knowledge of that market.
Details of the principal Key Performance Indicators (KPIs) can
be found in the Business Report of the Annual Report and a summary
of the Alternative Performance Measures (APMs) can be found in the
Financial Highlights in the Annual Report.
Whilst political and economic uncertainty has continued to
surround the UK's exit from the European Union (EU), it is
reassuring to report that most of the investee companies in the
portfolio have performed broadly in line with expectations. A
detailed analysis of portfolio developments can be found in the
Investment Manager's Review in the Annual Report. The continuing
positive performance achieved by a number of the more established
private companies has enabled the valuations of some of those
assets to be increased. The younger and earlier stage investee
companies have generally made satisfactory progress, although it
may take time for this to translate into meaningful uplifts in
valuations. The Board and the Manager will maintain a conservative
approach to valuing these assets, holding them at cost, or cost
less provision, until there is clear evidence of measurable
progress, or a specific event from which a new valuation can be
supported. Encouragingly, trading performance across the oil &
gas portfolio companies has continued to show a steady improvement,
following the trend of the previous year. However, elsewhere in the
portfolio, there are a small number of investments that are
operating behind plan or where a market adjustment has influenced
performance and, as a result, the valuations of these assets have
been reduced.
During the period under review, the holding in Cursor Controls,
a niche manufacturer of trackballs, trackpads and keyboards for
industrial applications, was sold at a premium to carrying value,
generating a total return of 2.7 times cost over the three-year
investment period. Discussions are underway regarding further
potential exits from a number of portfolio companies, although
there can be no certainty that these will result in profitable
realisations.
Dividends
The Directors recognise the importance of tax-free distributions
to investors. As a result of a build-up of distributable reserves,
including the proceeds from profitable realisations, and the
requirement to ensure ongoing compliance with the VCT regulations,
the Directors considered it appropriate to distribute an enhanced
level of interim dividends in the first half of the financial
year.
Accordingly, a first interim dividend in respect of the year
ended 28 February 2019, of 7.45p per Ordinary Share was paid on 13
April 2018 to Shareholders on the register at close of business on
16 March 2018. A second interim dividend of 5.10p per Ordinary
Share was paid on 22 June 2018 to Shareholders on the register at
close of business on 25 May 2018. As no final dividend is proposed,
the total distributions for the year were 12.55p per Ordinary
Share, representing a yield of 29.19% based on the year-end closing
mid-market price of 43.00p. It should be noted that the effect of
paying dividends is to reduce the NAV of the Company by the total
cost of the distribution. Since the Company's launch, and after
receipt of the payments noted above, Shareholders have received
94.91p per Ordinary Share in tax-free dividends.
Decisions on future distributions will take into consideration
the availability of surplus revenue, the adequacy of reserves and
the VCT qualifying level, all of which are kept under close and
regular review by the Board and the Manager. As the portfolio
continues to evolve, and a greater proportion of holdings are
invested in younger and earlier stage companies, there are likely
to be fluctuations in the quantum and timing of future dividend
payments, which may become more closely aligned to realisation
activity. The Board and the Manager will ensure that this is
carefully monitored, in line with your Company's investment
objective.
Dividend Investment Scheme (DIS)
Your Company has in place a DIS, through which Shareholders may
elect to have their dividend payments used to apply for new
Ordinary Shares issued by the Company under the standing authority
requested from Shareholders at annual general meetings. Shares
issued under the DIS should qualify for VCT tax relief applicable
for the tax year in which they are allotted, subject to an
individual Shareholder's particular circumstances. If a Shareholder
is in any doubt about the merits of participating in the DIS, or
their own tax status, they should seek advice from a qualified
adviser.
Shareholders who wish to participate in respect of any future
dividends should ensure that a DIS mandate or CREST instruction, as
appropriate, is submitted to the Registrar (Link Market Services).
The mandate form, terms & conditions and full details of the
scheme (including further details about tax considerations) are
available from the Company's website at www.mavencp.com/migvct. A
DIS election can also be made using the Link Market Services share
portal at www.signalshares.com.
Fund Raising
On 26 September 2018, the Directors of your Company, together
with the board of Maven Income and Growth VCT 5 PLC, launched a
joint Offer for Subscription of new Ordinary Shares for up to GBP30
million, in aggregate, with total over-allotment facilities of up
to a further GBP10 million (GBP5 million for each company). On 23
January 2019, your Board announced that, as the Company's level of
valid subscriptions were approaching the initial fundraising
target, its over-allotment facility would be utilised.
Subsequent to the period end, on 7 March 2019 your Board was
pleased to announce that the Company's Offer was fully subscribed,
having raised GBP20 million including full utilisation of the
over-allotment facility. A total of 38,112,053 new Ordinary Shares
were allotted on 6 March 2019, in respect of GBP18.52 million of
valid applications for the 2018/19 tax year. A final allotment of
3,049,148 Ordinary Shares, in respect of GBP1.48 million of valid
applications for the 2019/20 tax year took place on 24 April
2019.
The Board is confident that this additional liquidity will
enable your Company to continue to expand the portfolio in the
years to come, through investment in dynamic earlier stage
qualifying businesses that are capable of delivering growth and
enhancing Shareholder value.
Further details regarding the new Ordinary Shares issued under
the Offer for Subscription can be found in Note 12 to the Financial
Statements in the Annual Report.
Share Buy-backs
Shareholders should be aware that the Board's primary objective
is for the Company to retain sufficient liquid assets for making
investments in line with its stated policy and for the continued
payment of dividends. However, the Directors also acknowledge the
need to maintain an orderly market in the Company's shares and have
delegated authority to the Manager to buy back shares in the market
for cancellation or to be held in treasury, subject always to such
transactions being in the best interests of Shareholders. A total
of 700,000 Ordinary Shares were bought back for cancellation during
the year under review and further details can be found in Note 12
to the Financial Statements in the Annual Report.
It is intended that, subject to market conditions, available
liquidity and the maintenance of the Company's VCT status, shares
will continue to be bought back at prices representing a discount
of between 5% and 10% to the prevailing NAV per share.
Regulatory Developments
Following the legislative changes introduced by the Finance Act
2015, with further amendments included in the Finance Act 2018, it
is reassuring to report that the Finance Act 2019 did not contain
any further amendments to the legislation governing VCTs. Your
Company is well positioned to accommodate the provisions of the
Finance Act 2018, and in particular the requirement for a VCT to
hold 80% of its investments in qualifying holdings for financial
periods ending after 6 April 2019. This will be applicable for your
Company from 29 February 2020 and good progress towards this target
is being achieved.
The General Data Protection Regulation (GDPR) came into force on
25 May 2018, replacing the Data Protection Act 1998. During the
year, the Manager worked with the third parties that process
Shareholders' personal data to ensure that their rights under the
new regulation are respected.
In July 2018, the Financial Reporting Council published an
update of the UK Corporate Governance Code (the Code), which
focuses on the application and reporting of the updated Principles.
The 2018 Code applies to all companies with a Premium Listing and
is applicable for all accounting periods beginning on or after 1
January 2019. The Board will consider the implications of the Code
and take appropriate action as required.
Board of Directors
As Shareholders are aware, your Board has been considering its
constitution and I am pleased to welcome Alison Fielding and Andrew
Harrington as Non-executive Directors, with effect from 1 January
2019. Both Alison and Andrew have extensive experience of the
private equity industry and specifically advising early stage
growth businesses. Further details can be found in the Your Board
section of the Annual Report. As required by company law, Alison
and Andrew will stand for election by Shareholders at the Annual
General Meeting (AGM) on 4 July 2019.
As previously announced, Fiona Wollocombe resigned from the
Board on 24 January 2019. Fiona served as a non-executive Director
of the Company from May 2004, and as its Chairman from July 2005
until July 2010. On behalf of the Board and the Manager, I would
like to extend my thanks to Fiona for her valuable contribution and
wish her every success in the future.
The Future
The Directors are encouraged by the progress achieved in the
period under review and, notwithstanding the current economic and
political uncertainty associated with the UK's withdrawal from the
EU, remain optimistic in your Company's ability to continue to
generate meaningful growth in Shareholder value. The proceeds from
the Offer for Subscription provide important liquidity to
facilitate the ongoing expansion of the portfolio of investee
companies, and maintaining a good rate of momentum in the level of
investment activity will remain the priority for the year
ahead.
John Pocock
Chairman
24 May 2019
Business Report
This Business Report is intended to provide an overview of the
strategy and business model of the Company, as well as the key
measures used by the Directors in overseeing its management. The
Company is a venture capital trust and invests in accordance with
the investment objective set out in this Business Report. The Board
holds at least one meeting per annum at which strategic matters are
discussed.
Investment Objective
Under an investment policy approved by the Directors, the
Company aims to achieve long-term capital appreciation and generate
income for Shareholders.
Business Model and Investment Policy
Under an investment policy approved by the Directors, the
Company intends to achieve its objective by:
-- investing the majority of its funds in a diversified
portfolio of shares and securities in smaller, unquoted UK
companies and AIM/NEX quoted companies that meet the criteria for
VCT qualifying investments and have strong growth potential;
-- investing no more than GBP1.25 million in any company in one
year and no more than 15% of the Company's assets by cost in one
business at any time; and
-- borrowing up to 15% of net asset value, if required and only
on a selective basis, in pursuit of its investment strategy.
The Company had no borrowings as at 28 February 2019 and, as at
the date of this Report, the Board has no intention of utilising
the borrowing facility.
Principal Risks and Uncertainties
The principal risks and uncertainties facing the Company are as
follows:
Investment Risk
Many of the Company's investments are in small and medium sized
unquoted UK companies and AIM/NEX quoted companies which, by their
nature, carry a higher level of risk and lower liquidity relative
to investments in large quoted companies. The Board aims to limit
the risk attaching to the investment portfolio as a whole by
ensuring that a robust and structured selection, monitoring and
realisation process is applied by the Manager. The Board reviews
the investment portfolio with the Manager on a regular basis.
The Company manages and minimises investment risk by:
-- diversifying across a large number of companies;
-- diversifying across a range of economic sectors;
-- actively and closely monitoring the progress of investee companies;
-- co-investing with other clients of the Manager;
-- ensuring valuations of underlying investments are made fairly
and reasonably (see Notes 1(e) and 1(f) to the Financial Statements
for further detail);
-- taking steps to ensure that share price discount is managed appropriately; and
-- choosing and appointing an FCA authorised investment manager
with the appropriate skills, experience and resources required to
achieve the Investment Objective, with ongoing monitoring to ensure
the Manager is performing in line with expectations.
Financial and Liquidity Risk
As most of the investments require a mid to long term commitment
and are relatively illiquid, the Company retains a portion of the
portfolio in cash or cash equivalents in order to finance any new
unlisted investment opportunities. The Company has no direct
exposure to currency risk and does not enter into any derivative
transactions.
Economic Risk
The valuation of investment companies may be affected by
underlying economic conditions, such as fluctuating interest rates
and the availability of bank finance. The economic and market
environment is kept under constant review and the investment
strategy of the Company adapted, so far as is possible, to mitigate
emerging risks.
Credit Risk
The Company may hold financial instruments and cash deposits and
is dependent on counterparties discharging their agreed
responsibilities. The Directors consider the creditworthiness of
the counterparties to such instruments and seek to ensure that
there is no undue concentration of exposure to any one party.
Internal Control Risk
The Board reviews regularly the system of internal controls,
both financial and non-financial, operated by the Company, Maven
and other key third party outsourcers such as the Custodian and
Registrar. These include controls designed to ensure that the
Company's assets are safeguarded, that all records are complete and
accurate and that the third parties have adequate controls in place
to prevent data protection and cyber security failings.
VCT Qualifying Status Risk
The Company operates in a complex regulatory environment and
faces a number of related risks, including:
-- becoming subject to capital gains tax on the sale of its
investments as a result of a breach of Section 274 of the Income
Tax Act 2007;
-- loss of VCT status and consequent loss of tax reliefs
available to Shareholders as a result of a breach of the VCT
Regulations;
-- loss of VCT status and reputational damage as a result of a
serious breach of other regulations such as the FCA Listing Rules
and the Companies Act 2006; and
-- increased investment restrictions resulting from EU State Aid
Rules, incorporated by the Finance (No. 2) Act 2015 and the Finance
Act 2018.
The Board works closely with the Manager to ensure compliance
with all applicable and upcoming legislation, such that VCT
qualifying status is maintained. Further information on the
management of this risk is detailed under other headings in this
Business Report.
Legislative and Regulatory Risk
In order to maintain its approval as a VCT, the Company is
required to comply with VCT legislation in the UK as well as the EU
State Aid Rules. Changes in either legislation could have an
adverse impact on Shareholder investment returns whilst maintaining
the Company's VCT status. The Board and the Manager continue to
make representations where appropriate, either directly or through
relevant industry bodies such as the Association of Investment
Companies (AIC) and the British Private Equity and Venture Capital
Association (BVCA).
The Company has retained Philip Hare & Associates LLP as VCT
adviser and also uses a number of other VCT advisers on a
transactional basis.
Breaches of other regulations including, but not limited to, the
Companies Act 2006, the FCA Listing Rules, the FCA Disclosure
Guidance and Transparency Rules, the GDPR, or the Alternative
Investment Fund Managers Directive (AIFMD), could lead to a number
of detrimental outcomes and reputational damage. Breaches of
controls by service providers to the Company could also lead to
reputational damage or loss.
The AIFMD, which regulates the management of alternative
investment funds, including VCTs, introduced a new authorisation
and supervisory regime for all investment companies in the EU. The
Company is a small registered and internally managed alternative
investment fund under the AIFMD.
The Company is also required to comply with tax legislation
under the Foreign Account Tax Compliance Act and the Common
Reporting Standard. The Company has appointed Link Market Services
to act on its behalf to report annually to HMRC and to ensure
compliance with this new legislation.
Political Risk
Following the referendum held on 23 June 2016, the UK voted to
leave the EU and negotiations regarding the Withdrawal Agreement
are ongoing. The full political, economic and legal consequences of
this are not yet known. It is possible that investments in the UK
may be more difficult to assess for suitability of risk, harder to
buy or sell and, therefore, there will be a greater level of
subjectivity in their valuations. In the longer term, there is
likely to be a period of uncertainty as the UK seeks to negotiate
its ongoing relationship with the EU and other global trade
partners. In future, the UK's laws and regulations, including those
relating to investment companies and AIFMs may diverge from those
of the EU. This may lead to changes in the operation of the
Company, the rights of investors, or the territories in which the
shares of the Company may be promoted and sold.
In order to ensure that any risks arising are mitigated as
effectively as possible, the Board reviews the political situation
on a regular basis, together with any associated changes to the
economic, regulatory and legislative environment.
An explanation of certain economic and financial risks and how
they are managed is also contained in Note 16 to the Financial
Statements in the Annual Report.
Statement of Compliance with Investment Policy
The Company is adhering to its stated investment policy and
managing the risks arising from it. This can be seen in various
tables and charts throughout the Annual Report, and from
information provided in the Chairman's Statement and the Investment
Manager's Review. A review of the Company's business, its position
as at 28 February 2019 and its performance during the year then
ended is included in the Chairman's Statement, which also includes
an overview of its strategy and business model.
The management of the investment portfolio has been delegated to
Maven, which also provides company secretarial, administrative and
financial management services to the Company. The Board is
satisfied with the depth and breadth of the Manager's resources and
its network of offices, which supply new deals and enable it to
monitor the geographically widespread portfolio of companies
effectively.
The Investment Portfolio Summary in the Annual Report discloses
the investments in the portfolio and the degree of co-investment
with other clients of the Manager. The tabular analysis of the
unlisted and quoted portfolio in the Annual Report shows that the
portfolio is diversified across a variety of industry sectors and
deal types. The level of VCT qualifying investment is monitored by
the Manager on a daily basis and reported to the Risk Committee
quarterly, or as otherwise required.
Key Performance Indicators
During the year, the net return on ordinary activities before
taxation was GBP1,099,000 (2018: GBP903,000); gains on
investments were GBP1,292,000 (2018: GBP504,000); and earnings
per share were 2.06p (2018: 1.56p).
At each Board Meeting, the Directors also consider a number of
Alternative Performance Measures (APMs) to assess the Company's
success in achieving its objective as these are considered to be
more appropriate for this purpose. These APMs are viewed by the
Board as key performance indicators that enable Shareholders and
prospective investors to gain an understanding of the Company's
business, and are as follows:
-- NAV total return;
-- annual yield;
-- share price discount to NAV;
-- investment income; and
-- operational expenses.
The NAV total return is a measure of Shareholder value that
includes both the current NAV per share and total dividends paid to
date. The annual yield is the total of dividends paid per share for
the financial year, expressed as a percentage of the share price at
the year-end date. The Directors seek to pay dividends to provide a
yield and comply with the VCT rules, taking account of the level of
distributable reserves, profitable realisations in each accounting
period and the Company's future cash flow projections. The share
price discount to NAV is the percentage by which the mid-market
price of an investment is lower than its net asset value per
share.
Definitions of these APMs can be found in the Glossary in the
Annual Report. A historical record of these measures is shown in
the Financial Highlights in the Annual Report and the change in the
profile of the portfolio is reflected in the Summary of Investment
Changes in the Annual Report.
The Board reviews the Company's investment income and
operational expenses on a quarterly basis as the Directors consider
that both of these elements are important components in the
generation of Shareholder returns. Further information can be found
in Notes 2 and 4 to the Financial Statements in the Annual
Report.
There is no VCT index against which to compare the financial
performance of the Company. However, for reporting to the Board and
Shareholders, the Manager uses comparison with the most appropriate
index, being the FTSE AIM All-Share Index. The Directors also
consider non-financial performance measures such as the flow of
investment proposals and the Company's ranking within the VCT
sector by independent analysts.
In addition, the Directors consider economic, regulatory and
political trends and features that may impact on the Company's
future development and performance.
Valuation Process
Investments held by Maven Income and Growth VCT PLC in unquoted
companies are valued in accordance with the International Private
Equity and Venture Capital Valuation Guidelines. Investments quoted
or traded on a recognised stock exchange, including AIM, are valued
at their bid prices.
Share Buy-backs
At the forthcoming AGM, the Board will seek the necessary
Shareholder authority to continue to conduct a share buy-back
programme under appropriate circumstances.
Employee, Environmental and Human Rights Policy
As a VCT, the Company has no direct employee or environmental
responsibilities, nor is it responsible for the emission of
greenhouse gases. The Board's principal responsibility to
Shareholders is to ensure that the investment portfolio is managed
and invested properly. As the Company has no employees, it has no
requirement to report separately on employment matters. The
management of the Company's assets is undertaken by the Manager
through members of its portfolio management team.
The Manager engages with the Company's underlying investee
companies in relation to their corporate governance practices and
in developing their policies on social, community and environmental
matters and further information may be found in the Statement of
Corporate Governance in the Annual Report. In light of the nature
of the Company's business, there are no relevant human rights
issues and, therefore, the Company does not have a human rights
policy.
Independent Auditor
The Company's Independent Auditor is required to report if there
are any material inconsistencies between the content of the
Strategic Report and the Financial Statements. The Independent
Auditor's Report can be found in the Annual Report.
Future Strategy
The Board and Manager intend to maintain the policies set out
above for the year ending 29 February 2020, as it is believed that
these are in the best interests of Shareholders.
Approval
The Business Report, and the Strategic Report as a whole, was
approved by the Board of Directors and signed on its behalf by:
John Pocock
Director
24 May 2019
Income Statement
For the Year Ended 28 February 2019
Year ended 28 February Year ended 28 February
2019 2018
Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- -------- -------- -------- -------- -------- --------
Gains on investments - 1,292 1,292 - 504 504
Income from investments 664 - 664 1,244 - 1,244
Other income 10 - 10 14 - 14
Investment management
fees (102) (406) (508) (125) (502) (627)
Other expenses (359) - (359) (232) - (232)
----------------------------- -------- -------- -------- -------- -------- --------
Net return on ordinary
activities
before taxation 213 886 1,099 901 2 903
Tax on ordinary activities (35) 35 - (158) 96 (62)
----------------------------- -------- -------- -------- -------- -------- --------
Return attributable to
Equity Shareholders 178 921 1,099 743 98 841
----------------------------- -------- -------- -------- -------- -------- --------
Earnings per share (pence) 0.33 1.73 2.06 1.38 0.18 1.56
----------------------------- -------- -------- -------- -------- -------- --------
All gains and losses are recognised in the Income Statement.
All items in the above statement are derived from continuing
operations. The Company has only one class of business and one
reportable segment, the results of which are set out in the Income
Statement and Balance Sheet. The Company derives its income from
investments made in shares, securities and bank deposits.
There are no potentially dilutive capital instruments in issue
and, therefore, no diluted earnings per share figures are relevant.
The basic and diluted earnings per share are, therefore,
identical.
The accompanying Notes are an integral part of the Financial
Statements and are included in full in the Annual Report.
Statement of Changes in Equity
For the Year Ended 28 February 2019
Share Capital Capital Special Capital
Share premium reserve reserve distributable redemption Revenue
capital account realised unrealised reserve reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------- --------- -------- --------- ----------- -------------- ----------- --------- ---------
At 28 February
2018 5,356 10,253 (10,770) (599) 26,067 291 574 31,172
Net return - - 457 464 - - 178 1,099
Dividends paid - - (6,594) - - - (106) (6,700)
Repurchase and
cancellation of
shares (70) - - - (321) 70 - (321)
----------------- --------- -------- --------- ----------- -------------- ----------- --------- ---------
At 28 February
2019 5,286 10,253 (16,907) (135) 25,746 361 646 25,250
----------------- --------- -------- --------- ----------- -------------- ----------- --------- ---------
For the year ended 28 February 2018
Share Capital Capital Special Capital
Share premium reserve reserve distributable redemption Revenue
capital account realised unrealised reserve reserve reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------- --------- -------- --------- ----------- -------------- ----------- --------- ---------
At 28 February
2017 5,405 10,253 (10,738) 3,408 26,326 242 693 35,589
Net return - - 4,105 (4,007) - - 743 841
Dividends paid - - (4,137) - - - (862) (4,999)
Repurchase and
cancellation of
shares (49) - - - (259) 49 - (259)
----------------- --------- -------- --------- ----------- -------------- ----------- --------- ---------
At 28 February
2018 5,356 10,253 (10,770) (599) 26,067 291 574 31,172
----------------- --------- -------- --------- ----------- -------------- ----------- --------- ---------
The accompanying Notes are an integral part of the Financial
Statements and are included in full in the Annual Report.
Balance Sheet
As at 28 February 2019
28 February 2019 28 February 2018
GBP'000 GBP'000
------------------------------------ ---------------- ----------------
Fixed assets 22,578 20,671
Investments at fair value through
profit or loss 357 963
Current assets 2,349 9,636
Debtors
Cash
------------------------------------ ---------------- ----------------
Creditors 2,706 10,599
Amounts falling due within one
year (34) (98)
------------------------------------ ---------------- ----------------
Net current assets 2,672 10,501
------------------------------------ ---------------- ----------------
Net assets 25,250 31,172
------------------------------------ ---------------- ----------------
Capital and reserves
Called up share capital 5,286 5,356
Share premium account 10,253 10,253
Capital reserve - realised (16,907) (10,770)
Capital reserve - unrealised (135) (599)
Special distributable reserve 25,746 26,067
Capital redemption reserve 361 291
Revenue reserve 646 574
------------------------------------ ---------------- ----------------
Net assets attributable to Ordinary
Shareholders 25,250 31,172
------------------------------------ ---------------- ----------------
Net asset value per Ordinary
Share (pence) 47.76 58.20
------------------------------------ ---------------- ----------------
The Financial Statements of Maven Income and Growth VCT PLC
(registered in England & Wales; company number 3908220) were
approved by the Board of Directors on 24 May 2019 and were signed
on its behalf by:
John Pocock
Director
The accompanying Notes are an integral part of the Financial
Statements and are included in full in the Annual Report.
Cash Flow Statement
For the Year Ended 28 February 2019
Year ended 28 February Year ended 28 February
2019 2018
GBP'000 GBP'000
------------------------------- ---------------------- ----------------------
Net cash flows from operating
activities* (77) 280
Cash flows from investing
activities
Purchase of investments (2,642) (2,810)
Sale of investments 2,453 10,323
------------------------------- ---------------------- ----------------------
Net cash flows from investing
activities (189) 7,513
------------------------------- ---------------------- ----------------------
Cash flows from financing
activities
Equity dividends paid (6,700) (4,999)
Repurchase of Ordinary Shares (321) (259)
------------------------------- ---------------------- ----------------------
Net cash flows from financing
activities (7,021) (5,258)
------------------------------- ---------------------- ----------------------
Net (decrease)/increase in
cash (7,287) 2,535
------------------------------- ---------------------- ----------------------
Cash at beginning of year 9,636 7,101
Cash at end of year 2,349 9,636
------------------------------- ---------------------- ----------------------
*Refer to Note 15 in the Annual Report for reclassification in
the current and prior year.
The accompanying Notes are an integral part of the Financial
Statements and are included in full in the Annual Report.
Notes to the Financial Statements
For the Year Ended 28 February 2019
Accounting Policies
The Company is a public limited company, incorporated in England
& Wales and its registered office is shown in the Corporate
Summary in the Annual Report.
(a) Basis of preparation
The Financial Statements have been prepared under FRS 102, The
Financial Reporting Standard applicable in the UK and Republic of
Ireland and in accordance with the Statement of Recommended
Practice for Investment Trust Companies and Venture Capital Trusts
(the SORP) issued by the AIC in November 2014.
(b) Income
Dividends receivable on equity shares and unit trusts are
treated as revenue for the period on an ex-dividend basis. Where no
ex-dividend date is available dividends receivable on or before the
year end are treated as revenue for the period. Provision is made
for any dividends not expected to be received. The fixed returns on
debt securities and non-equity shares are recognised on a time
apportionment basis so as to reflect the effective interest rate on
the debt securities and shares. Provision is made for any income
not expected to be received. Interest receivable from cash and
short-term deposits and interest payable are accrued to the end of
the year.
(c) Expenses
All expenses are accounted for on an accruals basis and charged
to the Income Statement. Expenses are charged through the revenue
account except as follows:
-- expenses which are incidental to the acquisition and disposal
of an investment are charged to capital; and
-- expenses are charged to realised capital reserves where a
connection with the maintenance or enhancement of the value of the
investments can be demonstrated. In this respect the investment
management fee has been allocated 20% to revenue and 80% to
realised capital reserves to reflect the Company's investment
policy and prospective income and capital growth.
(d) Taxation
Deferred taxation is recognised in respect of all timing
differences that have originated but not reversed at the balance
sheet date, where transactions or events that result in an
obligation to pay more tax in the future or right to pay less tax
in the future have occurred at the balance sheet date. This is
subject to deferred tax assets only being recognised if it is
considered more likely than not that there will be suitable profits
from which the future reversal of the underlying timing differences
can be deducted. Timing differences are differences arising between
the Company's taxable profits and its results as stated in the
Financial Statements that are capable of reversal in one or more
subsequent periods.
Deferred tax is measured on a non-discounted basis at the tax
rates that are expected to apply in the periods in which timing
differences are expected to reverse, based on tax rates and laws
enacted or substantively enacted at the balance sheet date.
The tax effect of different items of income/gain and
expenditure/loss is allocated between capital reserves and revenue
account on the same basis as the particular item to which it
relates using the Company's effective rate of tax for the
period.
UK corporation tax is provided at amounts expected to be
paid/recovered using the tax rates and laws that have been enacted
or substantively enacted at the balance sheet date.
(e) Investments
In valuing unlisted investments, the Directors follow the
criteria set out below. These procedures comply with the revised
International Private Equity and Venture Capital Valuation
Guidelines (IPEVCV) for the valuation of private equity and venture
capital investments. Investments are recognised at their trade date
and are designated by the Directors as fair value through profit
and loss. At subsequent reporting dates, investments are valued at
fair value, which represents the Directors' view of the amount for
which an asset could be exchanged between knowledgeable and willing
parties in an arm's length transaction. This does not assume that
the underlying business is saleable at the reporting date or that
its current shareholders have an intention to sell their holding in
the near future.
A financial asset or liability is generally derecognised when
the contract that gives rise to it is settled, sold, cancelled or
expires.
1. For investments completed in the reporting period and those
at an early stage in their development, fair value is determined
using the Price of Recent Investment Method, except that
adjustments are made when there has been a material change in the
trading circumstances of the company or a substantial movement in
the relevant sector of the stock market.
2. Whenever practical, recent investments will be valued by
reference to a material arm's length transaction or a quoted
price.
3. Mature companies are valued by applying a multiple to their
prospective earnings to determine the enterprise value of the
company.
3.1 To obtain a valuation of the total ordinary share capital
held by management and the institutional investors, the value of
third party debt, institutional loan stock, debentures and
preference share capital is deducted from the enterprise value. The
effect of any performance related mechanisms is taken into account
when determining the value of the ordinary share capital.
3.2 Preference shares, debentures and loan stock are valued
using the Price of Recent Investment Method. When a redemption
premium has accrued, this will only be valued if there is a
reasonable prospect of it being paid. Preference shares which carry
a right to convert into ordinary share capital are valued at the
higher of the Price of Recent Investment Method basis and the
price/earnings basis, both described above.
4. In the absence of evidence of a deterioration, or strong
defensible evidence of an increase in value, the fair value is
determined to be that reported at the previous balance sheet
date.
5. All unlisted investments are valued individually by the
Manager's portfolio management team. The resultant valuations are
subject to detailed scrutiny and approval by the Directors of the
Company.
6. In accordance with normal market practice, investments listed
on AIM or a recognised stock exchange are valued at their bid
market price.
(f) Fair value measurement
Fair value is defined as the price that the Company would
receive upon selling an investment in a timely transaction to an
independent buyer in the principal or the most advantageous market
of the investment. A three-tier hierarchy has been established to
maximise the use of observable market data and minimise the use of
unobservable inputs and to establish classification of fair value
measurements for disclosure purposes. Inputs refer broadly to the
assumptions that market participants would use in pricing the asset
or liability, including assumptions about risk, for example, the
risk inherent in a particular valuation technique used to measure
fair value including such a pricing model and/or the risk inherent
in the inputs to the valuation technique. Inputs may be observable
or unobservable.
Observable inputs are inputs that reflect the assumptions market
participants would use in pricing the asset or liability developed
based on market data obtained from sources independent of the
reporting entity.
Unobservable inputs are inputs that reflect the reporting
entity's own assumptions about the assumptions market participants
would use in pricing the asset or liability developed based on best
information available in the circumstances.
The three-tier hierarchy of inputs is summarised in the three
broad levels listed below.
-- 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 (ie developed using market data) for
the asset or liability, either directly or indirectly.
-- Level 3 - inputs are unobservable (ie for which market data
is unavailable) for the asset or liability.
(g) Gains and losses on investments
When the Company sells or revalues its investments during the
year, any gains or losses arising are credited/charged to the
Income Statement.
(h) Critical accounting judgements and key sources of estimation uncertainty
Disclosure is required of judgements and estimates made by the
Board and the Manager in applying the accounting policies that have
a significant effect on the Financial Statements. The area
involving the highest degree of judgement and estimates is the
valuation of unlisted investments recognised in Note 8 in the
Annual Report and explained in Note 1(e) above.
In the opinion of the Board and the Manager, there are no
critical accounting judgements.
Reserves
Share premium account
The share premium account represents the premium above nominal
value received by the Company on issuing shares net of issue
costs.
Capital reserves
Gains or losses on investments realised in the year that have
been recognised in the Income Statement are transferred to the
capital reserve realised account on disposal. Furthermore, any
prior unrealised gains or losses on such investments are
transferred from the capital reserve unrealised account to the
capital reserve realised account on disposal.
Increases and decreases in the fair value of investments are
recognised in the Income Statement and are then transferred to the
capital reserve unrealised account. The capital reserve realised
account also represents capital dividends, capital investment
management fees and the tax effect of capital items.
Special distributable reserve
The total cost to the Company of the repurchase and cancellation
of shares is represented in the special distributable reserve.
Capital redemption reserve
The nominal value of shares repurchased and cancelled is
represented in the capital redemption reserve.
Revenue reserve
The revenue reserve represents accumulated profits retained by
the Company that have not been distributed to Shareholders as a
dividend.
Earnings per share
Year ended 28 February Year ended 28 February
2019 2018
---------------------------- ---------------------- ----------------------
The returns per share have 53,147,172 53,864,742
been based on the following GBP178,000 GBP743,000
figures. GBP921,000 GBP98,000
Weighted average number of
Ordinary Shares
Revenue return
Capital return
---------------------------- ---------------------- ----------------------
Total return GBP1,099,000 GBP841,000
---------------------------- ---------------------- ----------------------
Net Asset Value per Ordinary Share
Net asset value per Ordinary Share as at 28 February 2019 has
been calculated using the number of Ordinary Shares in issue at
that date of 52,863,884 (2018: 53,563,884)
Directors' Responsibility Statement
The Directors believe that, to the best of their knowledge:
-- the Financial Statements have been prepared in accordance
with the applicable accounting standards and give a true and fair
view of the assets, liabilities, financial position and profit or
loss of the Company as at 28 February 2019 and for the year to that
date;
-- the Directors' Report includes a fair review of the
development and performance of the Company, together with a
description of the principal risks and uncertainties that it faces;
and
-- the Annual Report and Financial Statements, taken as a whole,
is fair, balanced and understandable and provides the information
necessary for Shareholders to assess the Company's position and
performance, business model and strategy.
Other Information
The Annual General Meeting will be held on Thursday 4 July 2019,
commencing at 12.00 noon, at the offices of Maven Capital Partners
UK LLP, Fifth Floor, 1-2 Royal Exchange Buildings, London EC3V
3LF.
Copies of this announcement, and of the Annual Report and
Financial Statements for the year ended 28 February 2019, will be
available to the public at the offices of Maven Capital Partners UK
LLP, Kintyre House, 205 West George Street, Glasgow G2 2LW; at the
registered office of the Company, Fifth Floor, 1-2 Royal Exchange
Buildings, London EC3V 3LF and on the Company's website at
www.mavencp.com/migvct.
The Annual Report and Financial Statements for the year ended 28
February 2019 will be issued to Shareholders and filed with the
Registrar of Companies in due course.
The financial information contained within this Announcement
does not constitute the Company's statutory Financial Statements as
defined in the Companies Act 2006. The statutory Financial
Statements for the year ended 28 February 2018 have been delivered
to the Registrar of Companies and contained an audit report which
was unqualified and did not constitute statements under S498(2) or
S498(3) of the Companies Act 2006.
Neither the content of the Company's website nor the contents of
any website accessible from hyperlinks on the Company's website (or
any other website) is incorporated into, or forms part of, this
announcement.
The Annual Report will be submitted to the National Storage
Mechanism and will be available for inspection at:
www.morningstar.co.uk/uk/NSM.
By Order of the Board
Maven Capital Partners UK LLP
Secretary
24 May 2019
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
FR LLFISEFISFIA
(END) Dow Jones Newswires
May 24, 2019 10:09 ET (14:09 GMT)
Maven Income & Growth Vct (LSE:MIG1)
Historical Stock Chart
From Apr 2024 to May 2024
Maven Income & Growth Vct (LSE:MIG1)
Historical Stock Chart
From May 2023 to May 2024