REG-Augmentum Fintech plc: Augmentum Fintech plc Annual Report 2024
25/06/2024 07:15
25 June 2024
Augmentum Fintech plc
Annual Financial Report for the year ended 31 March 2024
Augmentum Fintech plc (LSE: AUGM) (the "Company" or "Augmentum"), Europe's
leading publicly listed fintech fund, announces its audited Annual Results for
the year ended 31 March 2024.
Financial highlights
* NAV before performance fee increased by 3.1% to £303.3 million1 (31 March
2023: £294.1 million1) of which the value of the investment portfolio was
£265.1 million (31 March 2023: £254.3 million).
* NAV per share after performance fee increased by 5.4% to 167.4p2 (31 March
2023: 158.9p). The increase in NAV per share after performance fee was driven
by net investment return for the year +6.8p and impact of share buybacks
+1.7p.
* Cash reserves of £38.5 million as at 31 March 2024 and £44.8 million as at
31 May 2024 (31 March 2023: £40.0 million).
Portfolio highlights
* The valuation of the top three positions (Tide, Zopa Bank and Grover) plus a
strong cash position, was just below Augmentum’s £170 million market
capitalisation at year end. These three companies have grown revenues by an
average of over 1,300% since initial investment and are either profitable or
expected to reach profitability without further funding.
* Top 10 holdings, which represent 81% of portfolio value (31 March 2023: 78%)
grew revenue at an average of 65% year-on-year (31 March 2023: 117%) and are
cash generative (five positions) or have an average of 203 months cash
runway.
* Cushon’s majority shareholding acquisition by NatWest Group completed
during the period, and returned £22.8 million to the Company, delivering a
return of 2.1x multiple on invested capital and an IRR of 62%.
* Post year end: exit from Onfido through the acquisition by Entrust,
delivering a return of 1.3x on invested capital and an IRR of 5.8%.
* There have now been six exits from the portfolio since inception all at or
above their last reported value, which have realised a cumulative £89.6
million in proceeds – £55.9 million over their original cost (c2.7x
invested capital).
* IRR of 16%4 on invested capital since inception (31 March 2023: 18.5%).
Investment activity
* Continued to maintain valuation and investment discipline across the
portfolio and new investment opportunities. Over the year, £15.8 million was
invested across one new company (Artificial Labs, a leading London-based
Insurtech) and six existing portfolio companies (31 March 2023: £19.9 million
invested in two new companies and eight existing portfolio companies).
* Post year end: Investment of £2.6 million in a new portfolio company
LoopFX.
Portfolio updates
* Tide (18.0% of NAV) grew its UK SME banking market share to 10% and is now
structurally profitable at a group level. In October 2023 Augmentum invested a
further £4.2 million through a combination of primary and secondary
transactions. International expansion continues with Germany, following the
successful launch in India.
* Zopa Bank (13.8% of NAV) raised £75 million in Tier 2 capital in October
2023 to support continued growth. It now has more than 1 million customers and
reached full-year profitability for the first time in 2023.
* Volt (9.0% of NAV) completed a Series B funding round of $60m led by US
investor IVP, with Augmentum investing a further £5.3 million. In June 2023,
Worldpay and Shopify selected Volt as their global A2A partner.
Neil England, Chairman of Augmentum Fintech plc commented:
“The Company’s NAV per share after performance fee at 31 March 2024 was
167.4p, up 5.4% from 31 March 2023. This continued our history of increases
for every reporting period since the Company’s IPO in 2018.”
“The UK equity market has been largely out of favour and investment company
discounts are running at historic highs in many cases. However, UK inflation
numbers are improving, and history suggests that growth companies such as
Augmentum will be early beneficiaries of any rally inspired by declining
rates.”
“We maintained our investment discipline over the last year and, with our
strong cash reserves (£44.8 million as at 31 May 2024), we are well placed
both to take advantage of new opportunities and to reinforce our appeal as a
supportive investor. We have a healthy pipeline of opportunities under
consideration.”
Tim Levene, CEO of Augmentum Fintech Management Limited commented:
“Several portfolio companies have posted meaningful profits this year and
have attracted substantial growth capital of over £150 million during the
period. The operational performance of the vast majority of the companies in
the portfolio has continued to be strong, with an average revenue growth of
65% across the top 10 holdings in the last 12 months. There have been some
standout results, in some cases ahead of expectations, and the majority of our
companies have over two years of cash runway.”
"Fintech’s market share of global financial services revenue remains below
5% but is set to more than double during the next decade as fintech companies
both disrupt incumbent firms and become their partners for delivering digital
transformation and harnessing the potential of new technologies. Hundreds of
valuable companies will be built in Europe to support this change. In our
view, the European early stage fintech ecosystem has reached an exciting point
of maturity.”
“This year, we have crossed several important milestones; six years since
IPO, six exits delivered to the Company and the first portfolio position
rising above a fair value of £50 million.”
Notes
1. NAV before performance fee.
2. The Board considers the NAV per share after any performance fees payable to
be the most accurate way to reflect the underlying value of each share.
3. Average months of cash runway based on current burn rate for non-cash
generative companies in Top 10, using latest available data as of June 2024,
excludes Onfido exited post year end.
4. Annualised IRR on invested capital and realisations since inception using
valuations at the last reporting date. This measure does not include the
impact of net expenses and the performance fee provision.
Enquiries
Augmentum Fintech Tim Levene (Portfolio Manager) Martha Horrox (Marketing and IR) +44 (0)20 3961 5420 martha@augmentum.vc
Quill PR Nick Croysdill, Sarah Gibbons-Cook (Press and Media) +44 (0)20 7466 5050 augmentum@quillpr.com
Peel Hunt LLP Liz Yong, Huw Jeremy (Investment Banking) +44 (0)20 7418 8900
Singer Capital Markets Robert Peel, James Fischer (Investment Banking) +44 (0)20 7496 3000
Frostrow Capital LLP Paul Griggs (Company Secretary) +44 (0)20 3709 8733
About Augmentum Fintech
Augmentum invests in fast growing fintech businesses that are disrupting the
financial services sector. Augmentum is the UK’s only publicly listed
investment company focusing on the fintech sector in the UK and wider Europe,
having launched on the main market of the London Stock Exchange in 2018,
giving businesses access to patient capital and support, unrestricted by
conventional fund timelines and giving public markets investors access to a
largely privately held investment sector during its main period of growth.
-----
.
Augmentum Fintech plc
Annual Report and Financial Statements
for the year ended 31st March 2024
.
CHAIRMAN’S STATEMENT
Performance Highlights
31 March 2024 31 March 2023
NAV per Share after performance fee 1 * 167.4p 158.9p
NAV per Share after performance fee Total Return* 5.4% 2.4%
100.5p 97.0p
Total Shareholder Return* 3.6% (27.1%)
Discount to NAV per Share after performance fee* (40.0%) (39.0%)
Ongoing Charges Ratio* 2.0% 1.9%
* These are considered to be Alternative Performance Measures. Please see
the Glossary and Alternative Performance Measures on page 78.
1 The Board considers the NAV per share after any performance fees provision
to be the most accurate way to reflect the underlying value of each share,
whereas accounting standards require the Group’s consolidated NAV per share
to be presented before such fees are deducted as a consequence of our
Portfolio Manager being within our Group structure and the fees therefore
being eliminated on consolidation.
To read about our KPIs see page 23.
.
I am pleased to present our sixth annual report since the launch of the
Company in March 2018. This report covers the year ended 31 March 2024.
Investment Policy
Your Company predominantly invests in early stage European fintech businesses
which have technologies with the potential to transform the traditional
financial services sectors and/or support the trend to digitalisation and
market efficiency. A typical investment will offer the prospect of high growth
and the potential to scale. Our objective is to provide long-term capital
growth to shareholders by offering them exposure to a focused portfolio of
private fintech companies during what is often their period of rapid value
accretion.
Performance
Your Company’s NAV per share after performance fee at 31 March 2024 was
167.4p, up 5.4% from 31 March 2023, continuing our history of increases for
every reporting period since the Company’s IPO in 2018.
However, the price at which the shares traded continued to fail to represent
the NAV throughout the period, ending at 100.5p per share, up 3.5p from the
price at 31 March 2023 but still representing a discount to the NAV per share
after performance fee of 40.0%.
The UK equity market, and investment companies in particular, has been largely
out of favour and investment company discounts are running at historic highs
in many cases. The initial negative reaction to increased interest rates has
sustained but most commentators predict a rate reduction at some point; the
question remains as to when. UK inflation numbers are improving which removes
one of the barriers to lower rates. History suggests that growth companies
such as Augmentum will be early beneficiaries of any rally inspired by
declining rates. Our underlying portfolio is performing well and the current
discount is illogical. As at 31 March 2024, like at the half year, the
valuation of our top three positions in Tide, Zopa Bank and Grover, plus cash,
was almost equivalent to our £170 million market capitalisation, attributing
virtually no value to our £119 million of other investments.
Portfolio
In the first half of the year, the Company benefitted from its fifth portfolio
realisation since IPO. We received proceeds of £22.8 million from the
completion of NatWest Group’s acquisition of Cushon, appreciably ahead of
its prior valuation and representing a 2.1x multiple on invested capital, and
an IRR of 62%. Shortly after the year end, in April, we had our sixth exit.
One of the leading global providers of online identity verification, Entrust,
acquired Onfido, delivering an IRR of 5.8% and a multiple on capital invested
of 1.3x, with the realised value representing a c.5% uplift on the holding
value we reported in the Company’s half year results. To date, all of the
Company’s investment exits have been at or above the last reported holding
value, which should provide investors with comfort that our valuations process
is rigorous and corroborates the discipline our Portfolio Manager has
exercised when evaluating new investments and their reporting on the
portfolio.
Deployments in the year included one new investment, £4.0 million in
London-based insurtech Artificial, and a further £12.0 million of follow-on
funding to support existing portfolio companies. These included Volt (£5.3
million), Tide (£4.2 million) and, Grover (£1.4 million).
There is a full review of the portfolio and investment transactions during the
year in the Portfolio Manager’s Review beginning on page 15.
Portfolio Management
Our investment team continues to evaluate a wide range of opportunities,
reviewing financial and commercial metrics in order to identify those most
likely to be successful. We are active investors and our Portfolio Manager
works closely with the companies we invest in, often taking either a board or
an observer seat, and working closely with management to guide strategy
consistent with long-term value creation. Our portfolio is already diversified
across different fintech sectors and maturity stages and we are keen to expand
it further. We are committed to responsible investing. We integrate
Environmental, Social and Governance (“ESG”) factors in our analysis, due
diligence and operating practices as we believe that these are key in
mitigating risk and creating good investments.
Valuations
Your Board considers its governance role in the valuations process to be of
utmost importance. We operate with a Valuations Committee in addition to an
Audit Committee, both playing a key role in assessing portfolio valuation.
Your Board understands that shareholders are often sceptical of private equity
valuations as they cannot be readily verified in the way that public equities
can. We have always maintained a consistent, rigorous and disciplined approach
to valuations and the results we are reporting reflect an in-depth process,
supported by our advisers. We maintained our multiples in the bull market for
fintech when listed fintech multiples became elevated and so we have not
needed to make subsequent corrections, unlike some others. The six disposals
made to date provide some retrospective validation of this process.
We have carefully reviewed both the status and the forecasts of all of the
portfolio companies, used appropriate and consistent methodologies to
determine the value of each investment and sense checked our conclusions. We
also benefit from the majority of our investments occupying a senior position
in the capital structures of the investee companies, offering an element of
protection against downside risk.
Discount Control
The Company’s shares traded at a discount to NAV for the whole of the year
under review and up to the date of this report, notwithstanding the underlying
value and strong prospects of the portfolio.
The Board has continued its programme of highly accretive buybacks, albeit
more modestly in the second half, seeking to convey to the market our
confidence in the value of the portfolio, while also balancing this with the
need for capital to be available for new and follow-on investments. All the
shares repurchased by the Company are being held in treasury to potentially
reissue when the share price returns to a premium.
4,687,567 shares were bought back into treasury during the year to 31 March
2024 (2023: 5,806,934 shares), at an average price of 97.7p per share,
representing an average discount to the prevailing NAV per share after
performance fee of 38.6% and adding 1.7p/1.1% to the NAV per share. A further
99,118 shares have been bought back since March, up to 24 June 2024, at an
average price of 98.7p per share.
We will seek to renew shareholders’ authorities to issue and buy back shares
at the forthcoming AGM.
Potential Returns of Capital
As set out on page 25 of this annual report, the Company may, at the
discretion of the Directors, return up to 50% of the gains realised during a
year from the disposal of investments. Factors influencing decisions in this
regard include the quantum of sale proceeds, the opportunities offered by the
investment pipeline and the working capital requirements of the Company. To
date the Board has applied a proportion of such gains to share buybacks, as
this has been highly accretive to the Company’s NAV per share. This
notwithstanding, the Directors intend to consult with shareholders to
determine whether other means of cash distribution would be preferred.
Dividend
No dividend has been declared or recommended for the year. Your Company is
focused on providing capital growth and has a policy only to pay dividends to
the extent that it is necessary to maintain the Company’s investment trust
status.
Board
There have been no changes to the Board during the year but the three
Directors at IPO in 2018 are all scheduled to retire from the Board at the
same time, so it seems logical to stage these departures and commence Board
refreshment now. After six years in the Chair, I have decided to retire first
and will not be offering myself for re-election at the forthcoming AGM. We
have an excellent mix of skills and experience on the Board already but intend
to supplement our team with a new Director. We have engaged an independent
search firm for this purpose.
It has been my pleasure to chair Augmentum Fintech PLC from its successful IPO
in 2018 and to see it grow into a leading and highly respected player in
European fintech. My grateful thanks to our shareholders for their support, to
my Board colleagues for their diligence and hard work, and to Tim, Richard and
the team at Augmentum Fintech Management Limited who have together built a
much-admired Portfolio Manager.
AGM
Our AGM will be held on Thursday 19 September 2024 at 11.00 a.m. at the
Augmentum Fintech Management Limited office at 4 Chiswell Street, London EC1Y
4UP. Your Board strongly encourages shareholders to register their votes in
advance using the proxy form provided or by voting online, or if they are not
held directly, by instructing the nominee company through which the shares are
held. Registering votes in advance does not preclude shareholders from
attending the meeting.
Details of all of the resolutions can be found in the Notice of AGM, which is
published separately from this annual report and will be sent to shareholders
when the annual report is published. Both documents will also be available to
view on or download from the Company’s website at www.augmentum.vc.
Your Directors consider that all the resolutions listed are in the best
interests of the Company and its shareholders and recommend voting in favour
of them, as your Directors intend to do in respect of their own holdings.
Outlook
Interest rates remain stubbornly high for now, but UK and global inflation
numbers are improving which suggests a more positive medium-term outlook for
growth companies. As I write, early-stage growth portfolios remain out of
favour, but our Portfolio Manager has proved its model, well-illustrated by
the returns produced by our six realisations to date. Additionally, our
largest investments are performing very well.
The underlying need to digitalise and transform financial services remains.
The opportunity is undiminished as the traditional operators continue to
dominate, despite inroads made by some stellar fintech businesses with less
costly, and in many cases more secure, business models. Penetration is still
only c.5% across the industry although adoption of consumer focused fintech by
younger demographics is markedly higher.
We maintained our investment discipline over the last year and, with our
strong cash reserves (£44.8 million at 31 May 2024), we are well placed both
to take advantage of new opportunities and to reinforce our appeal as a
supportive investor. We have a healthy pipeline of opportunities under
consideration.
Your Board believes that the Company will see a closing of the discount at
which its shares trade in due course and, with the underlying growth of the
portfolio generally being very strong, expects that our patient shareholders
will be well rewarded in time.
Neil England
Chairman
24 June 2024
.
PORTFOLIO MANAGER’S REVIEW
Overview
When I wrote to you in November it was against the backdrop of a welcome
change in sentiment. Equity markets had responded positively to central bank
decisions to hold interest rates steady, ending the tightening cycle of 2022
and 2023. Since November, the anticipation of future rate cuts has further
boosted confidence, with global equity indices reaching record highs in early
2024.
Whilst we are as optimistic as we were in November, we temper this with a dose
of realism; rates remain elevated and whilst the first-rate cuts are now
trickling through, they will likely remain high well into 2025. The market
continues to set a high bar for growth stocks, seeking capital efficiency and
profitability, as well as strong growth. While the listed fintech sector is
yet to enjoy as broad a recovery as other areas of the market, robust investor
demand has emerged for top quality companies delivering disruptive and
differentiated propositions.
A flight to quality is also present in private markets, where investment
activity has normalised to the medium-term trend. This environment benefits
the Company as a preferred investor for quality fintechs. Several portfolio
companies have posted meaningful profits this year and have attracted growth
capital of over £150 million during the period.
The operational performance of the vast majority of the companies in the
portfolio has continued to be robust, with average revenue growth of 65%
across the top 10 in the last 12 months. There have been some standout
results, in some cases ahead of expectations, and the majority have over 2
years of cash runway, if they are not already profitable.
Longer term, the increasing dominance of US capital markets is a challenge
that UK and European policy makers must work to address, with real
implications for the future economic trajectory of the region. UK savings are
under-allocated to domestic markets, hindering growth. Whilst we support
initiatives such as the Mansion House Reforms, their implementation and
capital deployment into private markets needs to accelerate. In the absence of
meaningful change, as evidenced by diverging regional trajectories in this
recent recovery period, the UK and European markets continue to lose ground to
the US.
Fintech’s market share of global financial services revenue remains below 5%
but is set to more than double during the next decade as fintech companies
both disrupt incumbent firms and become their partners for harnessing the
potential of new technologies1. Hundreds of valuable companies will be built
in Europe to support sector wide digital transformation.
Companies in the fintech sector are addressing significant opportunities; in
2023, over 50% of fintechs in the F-Prime index of emerging, publicly traded,
financial technology companies, posted revenues above US$1 billion, growing
three times faster than incumbents (F-Prime Capital2). The European ecosystem
is producing high quality companies that with the right support have the
potential to operate and thrive at global scale. This includes a cohort of
near-term IPO candidates, including several from the Company’s portfolio.
Whilst IPOs have been almost entirely absent from the market in 2024, we hope
to see their return in 2025. With IPOs absent, M&A activity, driven mainly by
incumbent firms acquiring digital capabilities, has meanwhile continued at
pace. The resilience and depth of the exit market for fintechs is one of its
key strengths from an investment perspective. Fintech exits in Q1 2024
totalled 247 transactions and US$77 billion in realisations globally 99% of
which was M&A3. Without access to private markets, investors will continue to
miss these compelling opportunities.
In our view, the European early stage fintech ecosystem has reached an
exciting point of maturity. Exit activity has supported multiple cycles of
capital and talent recycling, including the 10 repeat founders in the
Company’s portfolio. This includes the Company’s 6th realisation through
M&A with the sale of Onfido to Entrust, a leading US listed provider of
digital identity solutions.
The flywheel of talent, funding and regulation is supporting quality companies
through growth stages. As we move towards a period of greater market
stability, we find ourselves operating from a position of strength. Our
diversified portfolio is resilient and performing well. The Company’s cash
position has been strengthened by recent exits, and we are addressing one of
the most compelling sector-wide growth opportunities available to investors
today.
In financial services, leveraging artificial intelligence (“AI”) is a top
priority due to significant breakthroughs in generative AI over the past 24
months. Our engagement with AI spans three key areas; portfolio companies,
such as Zopa Bank in credit underwriting and Intellis in trading decisions,
are leading in AI applications; we are exploring innovative AI led investment
opportunities; and our team uses AI tools and proprietary data to enhance
efficiency and coverage on a day-to-day basis. Staying ahead in applying new
technologies provides a competitive advantage for the portfolio and pipeline
companies, as well as a forward-thinking venture capital investment team.
Our strategy remains consistent; investment discipline rooted in experience
and fintech sector specialism, applied to proprietary pan-European deal flow
with a distinct, value-add approach that resonates with exceptional founders.
The Company remains a unique offer to public market investors, not just in
terms of its structure but also in terms of the quality and diversification of
the fintech exposure it offers.
Portfolio Overview
As I write the Company’s portfolio stands at 25 fintech companies, the same
level as at 31 March 2023. This follows the exit of workplace pension provider
Cushon during the reporting period and our post-period exit from Onfido, a
global leader in digital identity verification. This was the sixth exit since
IPO, which have delivered over £90 million in realisations to date. We have
added one new investment to the portfolio in Artificial, an innovative
algorithmic underwriting platform serving the speciality insurance industry.
The other addition to the portfolio comes from the post-period split of
existing portfolio company, Monese, into its retail bank Monese and its
banking as a service business, XYB.
The portfolio’s top 10 companies employ over 4,500 people and generate over
£1 billion in annual revenues, with year-on-year growth continuing at an
average of 65%. Five of this group are profitable and the remaining five have
an average cash runway of over 20 months.
As reflected in these recent transactions and true to our commitment six years
ago at IPO, the portfolio has diversified across the breadth of verticals that
make up the broader fintech opportunity, as well as by stages of maturity and
European markets. The resilience and strong performance of the portfolio
through more challenging macroeconomic times, and our growing record of
realisations, continue to deepen our confidence in this approach.
At the end of March, the sum of our top three positions, Tide, Zopa Bank, and
Grover, plus cash, is just below the Company’s market capitalisation. We
believe this represents a compelling value opportunity with unpriced option
value in the remaining 22 positions in the portfolio, which carry strong
future growth potential themselves.
These top three holdings are growing revenue at an average of 70%
year-on-year, with all three continuing to challenge their respective market
incumbents in industries ripe for disruption, a key investment thesis across
many of the portfolio companies. Tide, our largest holding, becomes the first
portfolio position to surpass £50 million in fair value having further
solidified their position as the market leader for SME banking in the UK and
has successfully launched in Germany and India in recent months.
We continue to support portfolio companies from their early stages through
both capital and strategic support. Our typical first investment is made at
the Series A stage and benefits from protective structures and board
representation, which we currently hold at 17 of the 25 portfolio companies,
including all of those that are early stage (pre-series B). In addition to
close monitoring of progress and strategic input, ongoing engagement enables
us to identify and action compelling follow-on investment opportunities as
companies mature.
We have demonstrated consistency in valuation approach against the backdrop of
volatility in public and private markets over the last two years. All the
Company’s material exits have now been delivered at or above the last
reported fair value of the holding. Its permanent capital model enables us to
reinvest exit proceeds into the next generation of high-potential European
fintech firms.
Following the exit of Onfido the Group’s cash position as at 31 May 2024 was
£44.8 million and, with greater confidence in early-stage valuations
following the normalisation of market conditions, we are in an advantageous
position to deploy capital into high-quality and appropriately priced
investment opportunities in the period ahead.
Onfido and interactive investor are two of the largest fintech transactions in
the UK in the last three years. We believe that from within the existing and
future portfolio, the Company is positioned to be part of more exit
transactions of this scale.
Investment Activity
In my recent reports, I have described our decision to slow deployment into
new opportunities in response to market conditions. The distortionary impact
of heightened valuations since late 2020 continued to play out during the
period and our extremely disciplined approach to valuation remained a key
reason for rejecting investment prospects at the investment committee stage.
Our total investment of £16 million across both new and follow-on investments
compares to £19.9 million in the prior year. We maintain that reduced
deployment has been the correct course in a market absent of the right
investments at the right price.
When we see the right opportunity, our ability to deploy capital remains
intact. In January 2024, we led a highly competitive £8 million Series A
round with a £4 million investment in Artificial, an emerging leader in the
Insurtech space. With the digitalisation of the London insurance market at the
forefront of change in the industry, we believe Artificial are well positioned
as one of the leading platforms for algorithmic underwriting. Artificial
characterises our early-stage strategy, bringing new technology that has the
capability to disrupt and drive significant change in an industry that has
been limited by legacy systems.
Within the existing portfolio, we invested a further £5.3 million into Volt
as part of a US$60 million Series B round completed by the company in June
2023. This takes the total invested in the company to £9.8 million. The fair
value of the holding at £25.5 million reflects this additional investment as
well as a £5.9 million valuation uplift versus March 2023. During this period
the company has grown revenue threefold, as the leading provider of real-time
payment connectivity to global merchants and service providers. Volt’s
increasingly diversified customer base spans a growing number of industries
and markets as the adoption of real-time account-to-account payments continues
around the world.
We made a £4.2 million additional investment in Tide in an oversubscribed
primary and secondary transaction in October 2023, helping to bolster the
company and increase our stake in one of the portfolio’s highest performing
assets. As the leading digital banking platform for small businesses in the
UK, Tide has now achieved 11% share of the UK market with more than 600,000
members and is both profitable in the UK and at a Group level. To further
diversify from a predominantly UK revenue focus as the company moves into a
new phase of maturity, Tide launched in India at the end of 2022, and in the
first 18 months attracted more than 250,000 new members. Following the
successful launch of their Indian operations, Tide launched in Germany in May
2024, further expanding their global offering.
In the reporting period, we also took up the Company’s shareholder rights to
invest a total of £1.8 million in small additional rounds at Grover, Wayhome
and Habito.
Other Top 10
During the last three years we have frequently talked about the resilience of
the portfolio. This resilience is rooted in the strong fundamentals of the
companies that we back and the ability of their management teams to weather
challenges of all descriptions and return their companies to growth
trajectories. The path to scale is never a straight line which is why a
long-term view and ongoing support are essential when investing in private
markets.
A patient approach is sometimes required to unlock long-term value. This has
been demonstrated by the portfolio’s second largest holding, Zopa Bank,
which has transformed since the write-down event in 2019. Their world class
team, coupled with exceptional underwriting technology, which applies advanced
AI, continues to drive Zopa’s position as a standout performer. During the
period Zopa Bank passed 1 million customers, achieved full-year profitability,
and further strengthened their balance sheet through a Tier 2 regulatory
capital raise of £75 million. The upward movement in the valuation of the
portfolio’s holding of £9.3 million follows year-on-year revenue growth of
74% and returns the fair value of the holding above the cost of investment.
Grover is focused on profitability, with their flexible subscription model now
operating at significant scale with run-rate revenue now in excess of €250
million. The company achieved positive EBIT for the first three months of 2024
and plans to be cash-flow positive within the next 12 months. The last year
has presented challenges for Grover but progress is underway to ensure
performance is not stifled and the company can return to the growth it has
long enjoyed. We have been prudent in its valuation to reflect the challenges
the company has recently faced, and thus reduced the valuation by £8.6
million to £35.9 million.
At the beginning of this calendar year, we received a dividend of £0.8
million from BullionVault following a strong year of trading and record
profits. BullionVault’s performance has been supported by a combination of
investor demand for gold and other precious metals as an inflationary hedge,
and net interest income earned on fiat balances held by users on the exchange.
This has driven an uplift in the fair value of the portfolio’s holding of
£2.4 million. BullionVault is a mature position in the portfolio and serves a
hedging function during times of heightened market uncertainty.
Gemini represents another story of resilience and recovery as the company
returns to the portfolio’s Top 10. As a regulated multi-asset exchange and
custodian serving both institutional and retail investors, Gemini has been a
beneficiary of the positive price action in digital asset markets that has
followed from increased regulatory clarity in the US and the approval of
crypto ETF products. In addition, acting on behalf of Gemini users, the
company has secured a full recovery of assets loaned by users to a
crypto-lending company called Genesis. The uplift in the holding’s fair
value of £2.6 million is reflective of Gemini’s improved trajectory but
remains prudent and supported by the downside protective structures held on
this position.
We believe that the Company’s current exposure to the digital assets
vertical, at 6.5% of net assets, is set at an appropriate level based on the
maturity of the market. While we do not anticipate making further investments
in this vertical in the near term, we continue to track institutional themes
involving blockchain technologies that hold significant potential in the mid
to long term. These include the tokenisation of real-world assets and trade
settlement infrastructure.
One of the more unique propositions in the portfolio, Intellis, has continued
to flourish in the last 12 months with an evolving strategy resulting in
accelerated growth. The company deploys advanced proprietary AI trading
strategies in foreign exchange markets and has the potential to scale
significantly, both in current focus markets and potentially other asset
classes. Intellis’s lean cost base has led to a sustained period of
profitability. The £1.7 million uplift in the holding reflects their
encouraging progress.
The acquisition of Onfido, one of the global leaders in digital identity
verification, by Entrust was announced in February 2024. Following regulatory
approval, the acquisition completed post-period end on 9 April 2024, with
£10.1 million in proceeds received by the Company. This delivered an IRR of
5.8% and a multiple on capital invested of 1.3x. The realised value
represented a c.5% uplift on the holding value reported in the Company’s
half year results. The resulting IRR is well below our long-term target and
the product of investment terms that were introduced to the capital structure
of the company during a funding round that completed during the height of the
Covid pandemic. This outcome highlights the importance of maintaining
engagement and influence at board level, and of having the ability to defend
positions through follow-on funding. As this transaction was completed after
year end, Onfido remains in the top 10 at the completed transaction price.
Anyfin’s core product offering of credit refinancing combined with
additional budgeting and savings tools has continued to support financial
wellbeing for consumers across the Nordic region and Germany. Revenue growth
in 2023 remained strong at 63%, although the company has faced higher costs of
capital with an impact on margin. The experienced management team has
demonstrated strong capability while adjusting credit underwriting to the more
challenging macro environment. The company is prioritising an adjusted capital
structure and additional licences which have the potential to significantly
reduce the costs of capital over the longer term, following a trajectory
similar to that taken by Zopa Bank.
iwoca provides another example of exceptional resilience in the portfolio,
returning to performance and profitability following the end of Covid funding
support schemes and the retreat of high-street lenders from small business
funding. iwoca has demonstrated strong revenue growth with annualised revenue
up 77% year-on-year and consistent profitability, with positive EBIT building
month-on-month since January 2023. The company continues to prove the profit
potential of lending businesses that harness digital technologies to drive
significant operating leverage at scale.
Exits
In the half-year report I commented on the completion of a fifth portfolio
exit in June, with the sale of Cushon to NatWest Group. Augmentum received
proceeds of £22.8 million from the sale, delivering an IRR of 62% and a
multiple on capital invested of 2.1x. Realised value represented a 47% uplift
on the previously reported fair value of Augmentum’s position.
With Onfido, discussed above, these two additional exits bring total
realisations since IPO to £92 million. Each of the material exits have been
realised at or above the previously reported holding value, providing further
evidence to support our valuations.
Performance
For the year to 31 March 2024, we are reporting a NAV per share after
performance fee of 167.4p (31 March 2023: 158.9p). Since IPO the capital the
Company has deployed has generated an IRR of 16%. This is below our long-term
internal expectations of 20%.
The consistent approach to valuations that we have shown through the cycle is
supported by a growing track record of realisations. We hope that this will
continue to support investor confidence in the fair values we report for the
portfolio’s positions. Each position is valued using the most appropriate
methodology with most positions using public market comparables either as a
primary valuation technique or as a secondary cross-check.
Along with another strong year of growth across the portfolio, valuation
recovery in public markets has led to an increase in the public market
multiples used in our valuation approach. However, we remained prudent, with
our average forward sales multiple remaining at 4.8x, consistent with the
previous reporting period. Wider governance is a key element of the process
with each valuation audited and signed off by the Board and Valuations
Committee.
As we have detailed in previous reports, we continue to structure our typical
venture investments with downside protections such as liquidation preference
and anti-dilution provisions. 21 out of the 25 portfolio positions carry these
protections. Unlike ordinary share structures typically seen in the public
markets, these structures protect the value of the Company’s position in the
event of a reduction in the equity value of an investee company from the price
paid.
Outlook
Each set of annual results provides an opportune moment to first reflect and
then to chart the course ahead. We have crossed several important milestones;
six years since IPO, six exits delivered to the Company and the first
portfolio position rising above a fair value of £50 million. With this
growing track record, we are optimistic about the future, operating with
greater clarity and cohesion in a market primed for exceptional investments.
Cross-party political support for fintech in the UK positions the sector well.
Policy makers recognise it as a key growth sector, and a source of
international competitiveness. Investors can take further confidence in the
future environment for fintech innovation from this backdrop, which we expect
to continue.
In many respects the UK has led the way in fintech, building on strong
financial services heritage, deep pools of talent and an attractive investment
landscape. It remains the key market for fintech investment, capturing 57% of
total European investment in 20234. However, increasingly there are lessons to
be learnt from different approaches. In 2023, France (13%) overtook Germany
(12%) to secure second place share of fintech investment, with activity
supported by a collection of start-up friendly policies and the ‘Tibi’
pension fund investment scheme. It is important that the UK implements the
Mansion House Reforms and other measures, and continues to invest in financial
services regulation and emerging technologies such as AI to maintain its
position.
Healthy competition among nations to support fintech startups drives progress
in the European fintech ecosystem. Amongst the key benefits of this are value
and job creation, and financial inclusion for previously underserved groups
such as SMEs. Across Europe the value of the fintech sector is an estimated
€340 billion and 134,000 jobs have been newly created, over 5,000 of which
are from companies in the portfolio5.
We see excellent prospects in our pipeline and expect our deployment rate to
return to our long-term average. Pre-seed and seed stage activity has been
resilient, creating a strong pipeline of companies. Our proprietary
origination engine, ADA, (named after the mathematician and computing pioneer,
Ada Lovelace), reflects our extensive experience and assessment of over 5,000
fintech prospects. ADA enables us to operate at scale with a highly
specialised team, maintaining a high investment standard with a
lead-to-investment conversion rate of just 0.6%.
In the past year, our team has adjusted focus from portfolio management to
deal sourcing and deployment, assessing numerous companies and actively
engaging across Europe. Our latest investment in Artificial exemplifies our
thesis-led approach, targeting the right opportunities in Insurtech. We are
exploring themes including B2B payments, AI applications, compliance
technologies, and fintech solutions for the green energy transition.
Our investment strategy remains consistent, while the macroeconomic and policy
environments become more favourable. We will continue to invest in exceptional
teams at the early stages and support them to scale their companies and
ultimately secure meaningful exits.
Tim Levene
CEO
Augmentum Fintech Management Ltd
24 June 2024
1 BCG, 2023
2 https://fprimecapital.com/blog/the-2024-state-of-fintech-report
3 FT Partners
4 Innovate Finance
5 McKinsey
.
INVESTMENT OBJECTIVE AND POLICY
Investment objective
The Company’s investment objective is to generate capital growth over the
long term through investment in a focused portfolio of fast growing and/or
high potential private financial services technology (“fintech”)
businesses based predominantly in the UK and wider Europe.
Investment policy
In order to achieve its investment objective, the Company invests in early or
later stage investments in unquoted fintech businesses. The Company intends
to realise value through exiting these investments over time.
The Company seeks exposure to early stage businesses which are high growth,
with scalable opportunities, and have disruptive technologies in the banking,
insurance and wealth and asset management sectors as well as those that
provide services to underpin the financial sector and other cross-industry
propositions.
Investments are expected to be mainly in the form of equity and equity-related
instruments issued by portfolio companies, although investments may be made by
way of convertible debt instruments. The Company intends to invest in unquoted
companies and will ensure that the Company has suitable investor protection
rights where appropriate. The Company may also invest in partnerships, limited
liability partnerships and other legal forms of entity. The Company will not
invest in publicly traded companies. However, portfolio companies may seek
initial public offerings from time to time, in which case the Company may
continue to hold such investments without restriction.
The Company may acquire investments directly or by way of holdings in special
purpose vehicles or intermediate holding entities (such as the Partnership*).
The Management Team has historically taken a board or board observer position
at investee companies and, where in the best interests of the Company, will do
so in relation to future investee companies.
The Company’s portfolio is expected to be diversified across a number of
geographical areas predominantly within the UK and wider Europe, and the
Company will at all times invest and manage the portfolio in a manner
consistent with spreading investment risk.
The Management Team will actively manage the portfolio to maximise returns,
including helping to scale the team, refining and driving key performance
indicators, stimulating growth, and positively influencing future financing
and exits.
Investment restrictions
The Company will invest and manage its assets with the object of spreading
risk through the following investment restrictions:
• the value of no single investment (including related investments in group
entities or related parties) will represent more than 15 per cent. of Net
Asset Value;
• the aggregate value of seed stage investments will represent no more than
1 per cent. of Net Asset Value; and
• at least 80 per cent. of Net Asset Value will be invested in businesses
which are headquartered in or have their main centre of business in the UK or
wider Europe.
In addition, the Company will itself not invest more than 15 per cent. of its
gross assets in other investment companies or investment trusts which are
listed on the Official List of the FCA.
Each of the restrictions above will be calculated at the time of investment
and disregard the effect of the receipt of rights, bonuses, benefits in the
nature of capital or by reason of any other action affecting every holder of
that investment. The Company will not be required to dispose of any investment
or to rebalance the portfolio as a result of a change in the respective
valuations of its assets.
Hedging and derivatives
Save for investments made using equity-related instruments as described above,
the Company will not employ derivatives of any kind for investment purposes,
but derivatives may be used for currency hedging purposes.
Borrowing policy
The Company may, from time to time, use borrowings to manage its working
capital requirements but shall not borrow for investment purposes. Borrowings
will not exceed 10 per cent. of the Company’s Net Asset Value, calculated at
the time of borrowing.
Cash management
The Company may hold cash on deposit and may invest in cash equivalent
investments, which may include short-term investments in money market type
funds and tradeable debt securities.
There is no restriction on the amount of cash or cash equivalent investments
that the Company may hold or where it is held. The Board has agreed prudent
cash management guidelines with the AIFM and the Portfolio Manager to ensure
an appropriate risk/return profile is maintained. Cash and cash equivalents
are held with approved counterparties.
It is expected that the Company will hold between 5 and 15 per cent. of its
Gross Assets in cash or cash equivalent investments, for the purpose of making
follow-on investments in accordance with the Company’s investment policy and
to manage the working capital requirements of the Company.
Changes to the investment policy
No material change will be made to the investment policy without the approval
of Shareholders by ordinary resolution. Non-material changes to the investment
policy may be approved by the Board. In the event of a breach of the
investment policy set out above or the investment and gearing restrictions set
out therein, the Management Team shall inform the AIFM and the Board upon
becoming aware of the same and if the AIFM and/or the Board considers the
breach to be material, notification will be made to a Regulatory Information
Service.
* Please refer to the Glossary on page 78.
.
PORTFOLIO REVIEW
Fair value of Net Impact of foreign currency rate changes £’000 Investment Fair value of % of Net assets after performance fee
holding at investments/ return holding at
31 March (realisations £’000 31 March
2023 £’000 2024
£’000 £’000
Tide 35,692 4,176 – 11,425 51,293 18.0%
Zopa Bank^ 30,093 – – 9,198 39,291 13.8%
Grover 43,150 1,368 (1,103) (7,522) 35,893 12.6%
Volt 14,216 5,300 – 5,942 25,458 9.0%
BullionVault^ 11,564 (799) – 2,354 13,119 4.6%
Gemini 8,306 – (308) 2,926 10,924 3.9%
Onfido 10,242 – (51) (43) 10,148 3.6%
Intellis 8,412 – (79) 1,741 10,074 3.5%
AnyFin 9,304 – (817) 928 9,415 3.3%
Iwoca 7,882 – – 44 7,926 2.8%
Top 10 Investments 178,861 10,045 (2,358) 26,993 213,541 75.1%
Other Investments* 52,644 5,931 (564) (6,469) 51,542 18.1%
Cushon 22,790 (22,790) – – – 0.0%
Total Investments 254,295 (6,814) (2,922) 20,524 265,083 93.2%
Cash & cash equivalents 40,015 38,505 13.5%
Net other current liabilities (186) (271) -0.1%
Net Assets 294,124 303,317 106.7%
Performance Fee accrual (16,819) (18,980) -6.7%
Net Assets after performance fee 277,305 284,337 100.0%
^ Held via Augmentum I LP
* There are fourteen other investments (31 March 2023: fifteen). See page 13
for further details.
.
KEY INVESTMENTS
Tide
Tide’s (www.tide.co) mission is to help small and mid-sized businesses
(“SMEs”) save time and money in the running of their businesses. Customers
can be set up with an account number and sort code in less than 10 minutes,
and the company is building a comprehensive suite of digital banking services
for businesses, including automated accounting, instant access to credit, card
control, instant card freezing and quick, mobile invoicing. Tide acquired
Funding Options in 2022, giving Tide’s customers access to a wider range of
credit options and creating one of the UK’s biggest digital marketplaces for
SME credit. Tide continues to expand its product offering and launched Tide
Accounting and Tide Acquiring in 2023, and recently joined the Current Account
Switch Service. Tide is also expanding geographically. Tide launched in India
in 2022 and it has recently announced plans to launch in Germany during 2024.
Tide has 10% market share of small business accounts in the UK, with more than
575,000 customers, and more than 225,000 members in India.
Augmentum led Tide’s £44.1 million first round of Series B funding in
September 2019, alongside Japanese investment firm The SBI Group. In July 2021
Tide completed an £80 million Series C funding round led by Apax Digital, in
which Augmentum invested an additional £2.2 million and into which the £2.5
million loan note converted. In October 2023 Augmentum invested a further
£4.2 million through a combination of primary and secondary transactions.
Source: Tide 31 March 31 March
2024 2023
£’000 £’000
Cost: 17,376 13,200
Value: 51,293 35,692
Valuation Methodology^ Rev.Multiple Rev.Multiple
As per last filed audited accounts of the investee company for the year to 31
December 2022:
2022 2021
£’000 £’000
Turnover 59,176 33,541
Pre tax loss (40,781) (32,719)
Net assets 34,990 66,297
^ See note 13(iii) on pages 62 to 64.
.
Zopa
Having been founded in 2005 as the world’s first peer-to peer (“P2P”)
lending company, Zopa (www.zopa.com) launched Zopa Bank following a funding
round in 2020. It was granted a full UK banking licence, allowing it to offer
a wider product range to its customers. After 17 years of delivering positive
returns for investors, Zopa closed the P2P lending side of its business in
2021 to fully focus on Zopa Bank.
Current products include fixed term and smart savings, wedding and home
improvement loans, debt consolidation loans, a credit card and motor finance.
Zopa Bank is regulated by both the PRA and the FCA.
Zopa Bank is a multiple awards winner. In 2024, Zopa won three more awards
from MoneyNet; Best Savings App, Best Fixed Rate Cash ISA Provider and
Personal Savings Provider of the Year. These follow a string of previous
awards, including being named the British Bank Awards’ Best Personal Loan
Provider for the sixth year in a row in 2023. 2023 marked a key milestone,
with Zopa achieving its first full year of profitability.
Augmentum participated in a £20 million funding round led by Silverstripe in
March 2021, in October 2021 participated with a further £10 million
investment in a £220 million round led by SoftBank, and in February 2023
invested a further £4 million as part of a £75 million equity funding round
alongside other existing investors. In September 2023 Zopa Bank raised £75
million in Tier 2 Capital to support further scaling.
Source: Zopa 31 March 31 March
2024 2023
£’000 £’000
Cost: 33,670 33,670
Value: 39,291 30,093
Valuation Methodology^ Rev.Multiple Rev.Multiple
As per last filed audited accounts of the investee company for the year to 31
December 2021:
2023 2022
£’000 £’000
Operating income 223,544 153,737
Pre tax profit/loss 10,828 (23,783)
Net assets 413,174 299,674
.
Grover
Berlin-based Grover (www.grover.com) is the leading consumer-tech subscription
platform, bringing the access economy to the consumer electronics market by
offering a simple, monthly subscription model for technology products. Private
and business customers have access to over 8,000 products including
smartphones, laptops, virtual reality technology, wearables and smart home
appliances. The Grover service allows users to keep, switch, buy, or return
products depending on their individual needs. Rentals are available in
Germany, Austria, the Netherlands and Spain. Grover is at the forefront of the
circular economy, with products being returned, refurbished and recirculated
until the end of their usable life. Grover has circulated over 1.2 million
devices. Total funding has been around €1.4 billion to date and it has over
400 employees.
In September 2019 Augmentum led a €11 million funding round with a €6
million convertible loan note (“CLN”) investment. This coincided with
Grover signing a €30 million debt facility with Varengold Bank, one of
Germany’s major fintech banking partners. In March 2021 Grover completed a
€60 million Series B equity and debt funding round, with Augmentum
participating and converting its CLN, and Grover’s Series C funding round in
April 2022 raised US$330 million in equity and debt funding. In September
2023, Augmentum invested £1.4 million as part of a €23 million transaction
that will help support the company to profitability.
Source: Grover 31 March 31 March
2024 2023
£’000 £’000
Cost: 9,295 7,927
Value: 35,893 43,150
Valuation Methodology Rev.Multiple Rev.Multiple
As an unquoted German company, Grover is not required to publicly file audited
accounts.
.
Volt
Volt (www.volt.io) is a provider of account-to-account payments connectivity
for international merchants and payment service providers (PSPs). An
application of Open Banking, account-to-account payments – where funds are
moved directly from one bank account to another rather than via payment rails
– delivering benefits to both consumers and merchants. This helps merchants
shorten their cash cycle, increase conversion and lower their costs. Volt
offers coverage in 25 markets and counting, including UK, Europe, Brazil and
Australia. In June 2023 Volt announced their partnership with Worldpay, the
world’s number one global non-bank merchant acquirer by volume processed,
giving Worldpay’s more than 1 million merchant customers across 146 markets
access to Volt’s open payment infrastructure. Volt also announced
integration with leading global commerce company Shopify in 2023, to power a
‘pay-by-bank’ option at checkout for merchants who use the Shopify
platform. In February 2024, Volt were granted a UK EMI licence by the FCA,
enabling Volt to evolve its cash management product ‘Connect’ for virtual
accounts.
Augmentum invested £0.5 million in Volt in December 2020, £4 million in its
June 2021 US$23.5 million Series A funding round and £5.3 million in its
US$60 million Series B funding round in June 2023.
Source: Volt 31 March 31 March
2024 2023
£’000 £’000
Cost: 9,800 4,500
Value: 25,459 14,216
Valuation Methodology Rev.Multiple CPORT
Volt is not required to publicly file audited accounts.
.
BullionVault
BullionVault (www.bullionvault.co.uk) is a physical gold and silver market for
private investors online. It enables people across 175 countries to buy and
sell professional-grade bullion at competitive prices online, with US$3.7
billion of assets under administration, over US$100 million worth of gold and
silver traded monthly, and over 100,000 clients.
Each user’s property is stored in secure, specialist vaults in London, New
York, Toronto, Singapore and Zurich. BullionVault’s unique daily audit then
proves the full allocation of client property every day.
The company generates monthly profits from trading, commission and interest.
It is cash generative, dividend paying, and well-placed for any cracks in the
wider financial markets.
Source: BullionVault 31 March 31 March
2024 2023
£’000 £’000
Cost: 8,424 8,424
Value: 13,119 11,565
Valuation Methodology EBITDA Multiple EBITDA Multiple
Dividends paid: 799 564
As per last filed audited accounts of the investee company for the year to 31
October 2023:
2023 2022
£’000 £’000
Gross profit 13,311 13,071
Pre tax profit 13,023 8,364
Net assets 46,323 41,294
.
Gemini
Gemini (www.gemini.com) enables individuals and institutions to safely and
securely buy, sell and store cryptocurrencies. Gemini was founded in 2014 by
Cameron and Tyler Winklevoss and has been built with a security and regulation
first approach. Gemini operates as a New York trust company regulated by the
New York State Department of Financial Services (NYSDFS) and was the first
cryptocurrency exchange and custodian to secure SOC 1 Type 2 and SOC 2 Type 2
certification. Gemini entered the UK market in 2020 with an FCA Electronic
Money Institution licence, becoming one of only ten companies to have achieved
FCA Cryptoasset Firm Registration at that time.
Gemini announced acquisitions of portfolio management services company BITRIA
and trading platform Omniex in January 2022. During 2023 Gemini expanded into
the UAE and Asia.
Augmentum participated in Gemini’s first ever funding round in November 2021
with an investment of £10.2 million.
Source: Gemini 31 March 31 March
2024 2023
£’000 £’000
Cost: 10,150 10,150
Value: 10,924 8,306
Valuation Methodology Rev.Multiple Rev.Multiple
Gemini is not required to publicly file audited accounts.
.
Onfido
Onfido is building the new identity standard for the internet. Its AI-based
technology assesses whether a user’s
government-issued ID is genuine or fraudulent, and then compares it against
their facial biometrics. Using computer vision and a number of other AI
technologies, Onfido can verify against 4,500 different types of identity
documents across 195 countries, using techniques like “facial liveness’’
to see patterns invisible to the human eye.
Onfido was founded in 2012. It has offices in London, San Francisco, New York,
Lisbon, Paris, Amsterdam, New Delhi and Singapore and helps over 900
companies, including industry leaders such as Revolut, bung and Bitstamp. In
May 2023 Onfido announced the acquisition of Airside Mobile Inc, the leader in
private, digital identity sharing technology whose customers include the
world’s largest airlines.
Augmentum invested £4 million in 2018 as part of a US$50 million funding
round and an additional £3.7 million in a convertible loan note in December
2019 as part of a £4.7 million round. The latter converted into equity when
Onfido raised an additional £64.7 million in April 2020. Augmentum exited its
position in April 2024 when Entrust, a global leader in identity, payments,
and data security solutions, acquired Onfido. Proceeds of £10.1 million have
been received.
Source: Onfido 31 March 31 March
2024 2023
£’000 £’000
Cost: 7,750 7,750
Value: 10,148 10,242
Valuation Methodology Transaction Price Rev.Multiple
As per last filed audited accounts of the investee company for the 13 months
to 31 January 2022 (previous period 12 months to 31 December 2020):
2023 2022
£’000 £’000
Turnover 102,099 94,513
Pre tax loss (70,190) (45,159)
Net (liability)/assets (9,372) 40,165
.
Intellis
Intellis, based in Switzerland, is an algorithmic powered quantitative hedge
fund operating in the FX space. Intellis’ proprietary approach takes a
conviction based assessment towards trading in the FX markets, a position
which is uncorrelated to traditional news driven trading firms. They operate
across a range of trading venues with a regulated Investment Trust fund
structure that enables seamless
onboarding of new Liquidity Partners.
Following an initial investment of €1 million In 2019, Augmentum exercised
its option to invest a further €1 million in March 2020 and a further €1
million in March 2021.
Source: Intellis 31 March 31 March
2024 2023
£’000 £’000
Cost 2,696 2,696
Value 10,074 8,412
Valuation Methodology P/E Multiple P/E Multiple
As an unquoted Swiss company, Intellis is not required to publicly file
audited accounts.
.
Anyfin
Anyfin (www.anyfin.com) was founded in 2017 by former executives of Klarna,
Spotify and iZettle, and leverages technology to allow creditworthy consumers
the opportunity to improve their financial wellbeing by consolidating and
refinancing existing credit agreements with improved interest rates, as well
as offering smart budgeting tools. Anyfin is currently available in Sweden,
Finland, Norway and Germany, with plans to expand across Europe as well as
strengthen its product suite in existing markets, and over 500,000 people have
downloaded the app.
Augmentum invested £7.2 million in Anyfin in September 2021 as part of a
US$52 million funding round and a further £2.7 million as part of a US$30
million funding round in November 2022.
Source: Anyfin 31 March 31 March
2024 2023
£’000 £’000
Cost: 9,924 9,924
Value: 9,416 9,305
Valuation Methodology Rev. Multiple Rev. Multiple
As an unquoted Swedish company, Anyfin is not required to publicly file
audited accounts.
.
Iwoca
Founded in 2011, iwoca (www.iwoca.co.uk) uses award-winning technology to
disrupt small business lending across Europe. They offer short-term
‘flexi-loans’ of up to £500,000 to SMEs across the UK and Germany. iwoca
leverages online integrations with high-street banks, payment processors and
sector-specific providers to look at thousands of data points for each
business. These feed into a risk engine that enables the company to make a
fair assessment of any business and approve a credit facility within hours. In
addition to its flexi-loans, Iwoca launched iwocaPay in June 2020, an
innovative business-to-business (B2B) ‘buy now pay later’ product to
provide flexible payment terms to buyers while giving peace of mind to sellers
and also launched a revenue-based loan with eBay in 2022 where repayments are
a percentage of a business’s monthly sales. The company has lent over £3
billion in the UK and Germany since its launch across more than 130,000
business loans.
Augmentum originally invested £7.5 million in Iwoca in 2018 and has since
added £0.35 million. Iwoca has raised over £1 billion in debt funding from
partners including Barclays, Pollen Street Capital, Värde, Citibank and
Insight Investment.
Source: Monese 31 March 31 March
2024 2023
£’000 £’000
Cost: 7,852 7,852
Value: 7,926 7,882
Valuation Methodology Rev. Multiple Rev. Multiple
As per last filed audited accounts of the investee company for the year to 31
December 2022:
2022 2021
£’000 £’000
Turnover 78,260 68,468
Pre tax loss (10,980) (4,119)
Net assets 32,956 40,579
.
OTHER INVESTMENTS
Monese
Monese (www.monese.com) offers consumers the ability to open a UK or European
current account with a fully digital process. Launched in 2015 Monese has more
than 2 million registered users. 70% of incoming funds are from salary
payments, with customers using Monese as their primary account. In May 2023,
building on strong platform infrastructure, Monese launched XYB, a
banking-as-a-service (“BaaS”) platform. XYB enables financial institutions
to build digital products using Monese’s technology. Monese counts HSBC and
Investec amongst its XYB client base. The BaaS market shows strong growth as
established banks and fintech companies continue to bring innovative digital
products to market. In May 2024 Monese announced that it was splitting into
two standalone entities: its B2C retail bank Monese, and its B2B business XYB.
Augmentum is invested alongside Kinnevik, PayPal, International Airlines
Group, Investec and HSBC Ventures.
.
Farewill
In the next 10 years, £1 trillion of inheritance will pass between
generations in the UK. Farewill (www.farewill.com) is a digital, all-in-one
financial and legal services platform for dealing with death and after-death
services, including wills, probate and cremation, augmented with funeral plans
in 2024. In 2022 Farewill won National Will Writing Firm of the Year for the
fourth year in a row and in 2021 was Probate Provider of the Year for the
second consecutive year at the British Wills and Probate Awards. Farewill also
won Best Funeral Information Provider and Low-cost Funeral Provider of the
Year at the Good Funeral Awards 2021. The organisation has also been voted the
UK’s best-rated death experts on Trustpilot, scoring an average customer
approval rating of 4.9/5 from over 115,000 reviews. It is now the largest will
writer in the UK.
Since its launch in 2015 Farewill’s customers have pledged over £970
million to charities through their wills.
Augmentum led Farewill’s £7.5 million Series A fundraise in January 2019,
with a £4 million investment, participated in its £20 million Series B, led
by Highland Europe in July 2020, with £2.6 million, and in its further £4.8
million fundraise in March 2023, with £0.8 million.
.
Wematch
Wematch (www.wematch.live) is a capital markets trading platform that helps
financial institutions transition liquidity to an orderly electronic service,
improving productivity and de-risking the process of voice broking. Their
solution helps traders find liquidity, negotiate, trade, optimise and manage
the lifecycle of their portfolios of assets and trade structures. Wematch is
focused on structured products such as securities financing, OTC equity
derivatives and OTC cleared interest rates derivatives.
Created in 2017, Wematch is headquartered in Tel Aviv and has offices in
London and Paris. In March 2023 it announced a collaboration with MTS Markets,
owned by Euronext, creating MTS Swaps by Wematch.live, which aims to bridge
the gap between legacy voice trading and pure electronic trading in the
interdealer IRS market. In August 2023 Wematch passed a milestone of US$200
billion in ongoing notional value of trades on their platform and also reached
an average daily matched volume (ADMV) of US$11 billion in Europe, the Middle
East, and Africa.
Augmentum invested £3.7 million in September 2021.
.
Parafi
ParaFi Capital (www.parafi.com) is an investor in decentralised finance
protocols that address tangible use cases of the technology and demonstrate
signs of product-market fit. ParaFi investment has drawn on their domain
expertise developed in both traditional finance and crypto to identify and
invest in leading protocols such as Compound (lending and interest accrual),
Aave (asset borrowing), Uniswap (automated liquidity provision), Synthetix
(synthetic asset trading) and MakerDAO (stablecoins). ParaFi also supports its
protocols as a liquidity provider and governance participant.
Augmentum invested £2.8 million in ParaFi in January 2021. Co-investors
include Bain Capital Ventures and Galaxy Digital.
.
Wayhome
Wayhome (www.wayhome.co.uk) offers a unique part-own part-rent model of home
ownership, requiring as little as 5% deposit with customers paying a market
rent on the portion of the home that Wayhome owns, with the ability to
increase the equity in the property as their financial circumstances allow. It
launched to the public in September 2021, following closure of the initial
phase of a £500 million pension fund investment. The first fund has now
closed having helped over 650 people buy a new home. Wayhome are currently
working on their second fund.
Wayhome opens up owner-occupied residential property as an asset class for
pension funds, who will earn inflation-linked rent on the portion not owned by
the occupier.
Augmentum invested £2.5 million in 2019, £1 million in 2021 and a further
£0.9 million in the Company's financial year to 31 March 2023.
.
Kipp
Kipp (www.letskipp.com) is an Israeli fintech that has developed an AI
platform that transforms the traditional payment model to increase credit card
transaction approvals, revenue, and customer satisfaction. Its core solution
relies heavily on data enrichment and risk management to help merchants and
banks split the cost of risk to incentivize issuing banks to approve more
transactions. In 2022 Kipp won the Mastercard Fintech Engage Jury award and in
2023 was awarded first place at the Mastercard Fintech Forum CE event. It was
also the ‘Leading Financial Services or Payments Start-Up’ winner at the
2023 PAY360 Awards.
Augmentum invested £4 million in May 2022.
.
Artificial
Artificial (www.artificial.io) is an established underwriting technology
provider for the London Insurance Market. This London-based insurtech partners
with global insurers and brokers to facilitate algorithmic placement of
commercial and specialty risk, backed by their powerful contract builder and
underwriting platform.
Augmentum led Artificial’s £8 million Series A+ round in January 2024 with
a £4 million investment, alongside existing investors MS&AD Ventures and
FOMCAP IV. The round was aimed at allowing Artificial to accelerate their
growth, to continue to build out its product range and further consolidate its
position as a leader in algorithmic underwriting software as the insurance
market migrates towards digital solutions.
.
FullCircl
FullCircl (www.fullcircl.com) was formed from the combination of Artesian and
Duedil. Artesian was founded with a goal to change the way B2B sellers
communicate with their customers. They built a powerful sales intelligence
service using the latest in Artificial Intelligence and Natural Language
Processing to automate many of the time consuming, repetitive tasks that cause
the most pain for commercial people.
In August 2023 FullCircl announced the acquisition of W2 Global Data
Solutions, a provider of real-time digital solutions for global regulatory
compliance. The acquisition strengthens FullCircl’s compliance suite and
accelerates the company’s ambition to become the market leader in smart
customer onboarding solutions for regulated businesses. In February 2024
FullCircl announced the launch of its first white label orchestration platform
through W2 by FullCircl to help regulated businesses onboard more customers
and meet regulatory requirements.
Augmentum originally invested in DueDil, which merged with Artesian in July
2021. Combining DueDil’s Business Information Graph (B.I.G.)™ and Premium
APIs, and Artesian’s powerful web application and advanced rules engine
delivers an easy to deploy solution for banks, insurers and FinTechs to
engage, onboard and grow the right business customers.
.
Sfermion
Sfermion (www.sfermion.io) is an investment fund focused on the non-fungible
token (NFT) ecosystem. Their goal is to accelerate the emergence of the open
metaverse by investing in the founders, companies, and entities creating the
infrastructure and environments forming the foundations of our digital future.
Augmentum committed US$3 million in October 2021, to be drawn down in
tranches.
.
Baobab
Berlin based Baobab (www.baobab.io) is a pioneer in the provision of European
cyber insurance for SMEs. With capacity provision from Zurich, Baobab uses a
novel approach to underwriting, pricing and risk mitigation, and works with
leading SME cyber security providers to prevent breaches for its insured
customers.
Augmentum invested £2.6 million in January 2023.
.
Epsor
Epsor (www.epsor.fr) is a Paris based provider of employee and retirement
savings plans delivered through an open ecosystem, giving access to a broad
range of asset management products accessible through its intuitive digital
platform. Epsor serves more than 1,000 companies in France.
Augmentum invested £2.2 million in Epsor in June 2021.
.
WhiskyInvestDirect
Founded in 2015, WhiskyInvestDirect (www.whiskyinvestdirect.com), was a
subsidiary of BullionVault and is the online market for buying and selling
Scotch whisky as it matures in barrel. This is an asset class that has a long
track record of growth, yet has previously been opaque and inaccessible.
The business seeks to change the way maturing Scottish whisky is owned, stored
and financed, giving self-directed investors an opportunity to profit from
whisky ownership, with the ability to trade 24/7. At its October 2023
financial year end the company's clients held 10.9 million LPA (Litres of Pure
Alcohol) of spirit. Augmentum’s holding derives from WhiskyInvestDirect
being spun out of BullionVault in 2020.
.
Tesseract
Tesseract (www.tesseractinvestment.com) is a forerunner in the dynamic digital
asset sector, providing digital lending solutions to market makers and other
institutional market participants via regulated custody and exchange
platforms. Tesseract was founded in 2017, is regulated by the Finnish
Financial Supervisory Authority (“FIN-FSA”), and was one of the first
companies in the EU to obtain a 5AMLD (Fifth Anti-Money Laundering Directive)
virtual asset service provider (“VASP”) licence. It has an express
authorisation from the FIN-FSA to deploy client assets into decentralized
finance or “DeFi”.
Tesseract provides an enabling crypto infrastructure to connect digital asset
lenders with digital asset borrowers. This brings enhanced capital efficiency
with commensurate cost reduction to trading, in a space that is currently
significantly underleveraged relative to traditional capital markets.
Augmentum led Tesseract’s Series A funding round in June 2021 with an
investment of £7.3 million.
.
Previse
Previse (www.previse.co) allows suppliers to be paid instantly. Previse’s
artificial intelligence (“AI”) analyses the data from the invoices that
sellers send to their large corporate customers. Predictive analytics identify
the few problematic invoices, enabling the rest to be paid instantly. Previse
charges the suppliers a small fee for the convenience, and shares the profit
with the corporate buyer and the funder. Previse precisely quantifies dilution
risk so that funders can underwrite pre-approval payables at scale. In January
2022 Mastercard unveiled that its next-generation virtual card solution for
instant B2B payments would use Previse’s machine learning capabilities. The
solution combines Previse’s machine learning, with Mastercard’s core
commercial solutions and global payment network, to transform how businesses
send and receive payments.
Augmentum invested £250,000 in a convertible loan note in August 2019. This
converted into equity as part of the company’s US$11 million funding round
in March 2020, alongside Reefknot Investments and Mastercard, as well as
existing investors Bessemer Venture Partners and Hambro Perks. Previse was
awarded a £2.5 million Banking Competition Remedies’ Capability and
Innovation Fund grant in August 2020. In May 2022 Previse closed the first
phase of its series B financing round, which was led by Tencent, with US$18
million raised, including £2 million from Augmentum.
.
Habito
Habito (www.habito.com) is transforming the United Kingdom’s £1.3 trillion
mortgage market by taking the stress, arduous paperwork, hidden costs and
confusing process out of financing a home.
Since launching in April 2016, Habito had brokered £7 billion of mortgages by
July 2021. Habito launched its own buy-to-let mortgages in July 2019 and in
March 2021 launched a 40-year fixed-rate mortgage ‘Habito One’, the UK’s
longest-ever fixed rate mortgage.
In August 2019, Augmentum led Habito’s £35 million Series C funding round
with a £5 million investment and added £1.3 million in the Company's
financial year ended 31 March 2023.
.
STRATEGIC REPORT
Business Review
The Strategic Report, set out on pages 19 to 31, provides a review of the
Company’s business, performance during the year and its strategy going
forward. It also considers the principal risks and uncertainties facing the
Company and includes information for shareholders to assess how the Directors
have performed their duty to promote the success of the Company. In this
respect, information on how the Directors have discharged their duties under
Section 172 of the Companies Act 2006 can be found on pages 27 and 28.
The Strategic Report contains certain forward-looking statements. These
statements are made by the Directors in good faith based on the information
available to them up to the date of this report and such statements should be
treated with caution due to the inherent uncertainties, including both
economic and business risk factors, underlying any such forward-looking
information.
Strategy and Strategic Review
In accordance with its investment objective and policy, the Company continued
throughout the year under review to pursue the generation of capital growth
over the long term through investment in a focused portfolio of fast growing
and/or high potential private financial services technology (“fintech”)
businesses based predominantly in the UK and wider Europe.
The Company is an approved investment trust company and an alternative
investment fund (“AIF”) under the Alternative Investment Fund Managers
Regulations (“UK AIFMD”). It has appointed Frostrow Capital LLP as its
alternative investment fund manager (“AIFM”) and Augmentum Fintech
Management Limited as its Portfolio Manager.
Principal Risks and Risk Management
The Board is responsible for the ongoing identification, evaluation and
management of the risks faced by the Company and has established a process for
the regular review of these risks and their mitigation. This process accords
with the UK Corporate Governance Code and the FRC’s Guidance on Risk
Management, Internal Control and Related Financial and Business Reporting. The
Board's policy on risk management has not materially changed during the course
of the reporting period and up to the date of this report.
The Company maintains a framework of identified key risks, with the policies
and processes devised to monitor, manage and mitigate them where possible.
This risk map is reviewed regularly by the Audit Committee.
Further details of the financial risks are included in note 13 starting on
page 61.
The Board has carried out a robust assessment of the emerging and principal
risks facing the Company, including those that would threaten its business
model, future performance, solvency and liquidity. Further details of the risk
management processes that are in place can be found in the Corporate
Governance Statement.
The Board considers that the risks set out below are the principal risks
currently facing the Company.
Principal Risks and Uncertainties Mitigation
Investment Risks The Company invests in early-stage companies which, by their nature, may be smaller capitalisation companies. Such companies may not have the financial strength, diversity and the resources of larger and more established companies, and may The Portfolio Manager has put in place a rigorous investment process which ensures disciplined investment selection and portfolio management. This includes detailed due diligence, regular portfolio reviews and in many cases active engagement with portfolio companies by way of board representation or observer status. Investing in young businesses that may be cash consuming for a number of years is inherently risky. In order to reduce the risks of permanent capital loss the Portfolio Manager will, where possible, structure investments to afford a degree of downside protection through mechanisms such as a liquidation preference and/or antidilution provisions. The Portfolio Manager provides a detailed update at each Board meeting, including, inter alia , investee company developments and funding requirements.
find it more difficult to operate, especially in periods of low economic growth. The performance of the Group’s portfolio is influenced by a number of factors. These include, but are not limited to: (i) the quality of the initial investment decision; (ii)
reliance on co-investment parties; (iii) the quality of the management team of each underlying portfolio company and the ability of that team to successfully implement its business strategy; (iv) the success of the Portfolio Manager in building an
effective working relationship with each team in order to agree and implement value-creation strategies; (v) changes in the market or competitive environment in which each portfolio company operates; and (vi) environmental, social and governance (“ESG”)
factors. Any of these factors could have an impact on the valuation of an investment and on the Group’s ability to realise the investment in a profitable and timely manner.
Portfolio Diversification Risk The Group is subject to the risk that its portfolio may not be adequately diversified, being heavily concentrated in the fintech sector and the portfolio value may be dominated by a single or limited number of companies. The Group attempts to mitigate this risk by making investments across a range of companies in a range of fintech company subsectors and in companies at different stages of their lifecycle in accordance with the Investment Objective and Investment Policy. There is also geographic diversification with 63% of the portfolio being based in the UK and 37% in continental Europe, Israel and the US. Given the nature of the Company’s Investment Objective this remains a significant risk.
Cash Risk Returns to the Company through holding cash and cash equivalents are relatively low. The Company may hold significant cash balances, particularly when a fundraising has taken place, and this may have a drag on the Company’s performance. The To mitigate this risk the Board has agreed prudent cash management guidelines with the AIFM and Portfolio Manager. The Group maintains sufficient cash resources to manage its ongoing operational and investment commitments. Regular discussions are held to consider the future cash requirements of the Company and its investments to ensure that sufficient cash is maintained.
Company may require cash to fund potential follow-on investments in existing investee companies. If the Company does not hold sufficient cash to participate in subsequent funding rounds carried out by portfolio companies, this could result in the interest
the Company holds in such businesses being diluted. This may have a material adverse effect on the Company’s financial position and returns for shareholders.
Macroeconomic Risks The performance of the Group’s investment portfolio is materially influenced by economic conditions. These may affect demand for services supplied by investee companies, foreign exchange rates, input costs, interest rates, debt and Within the constraints dictated by its objective, the Company’s portfolio is diversified across a range of sectors, has no leverage, a net cash balance and the Portfolio Manager seeks to structure investments to provide downside protection where possible. The Board, AIFM and Portfolio Manager monitor the macroeconomic environment and this is discussed at each Board meeting, along with the potential impact. The Portfolio Manager also provides a detailed update on the investments at each meeting, including, inter alia , developments in relation to the macro environment and trends.
equity capital markets and the number of active trade and financial buyers. All of these factors could have an impact on the Group’s ability to realise a return from its investments and cannot be directly controlled by the Group. Particular current factors
include inflation, recession fears and the conflicts in Ukraine and the Middle East.
Strategy Implementation Risks The Group is subject to the risk that its long-term strategy and its level of performance fail to meet the expectations of its shareholders. A persistent discount could reflect a lack of demand for the Company's shares and A robust and sustainable corporate governance structure has been implemented with the Board responsible for continuing to act in the best interests of shareholders. An experienced fintech Portfolio Manager has been retained in order to deliver the strategy. The Company and the Portfolio Manager endeavour to keep the market informed of portfolio developments.
prevents fund raising through share issues.
Valuation Risk The valuation of investments in accordance with IFRS 13 and International Private Equity and Venture Capital (IPEV) Valuation Guidelines requires considerable judgement and is explained in note 19.12. The Company’s investments are illiquid The Company has a rigorous valuation policy and process as set out in notes 19.4 and 19.12. This process is led by the Board and includes benchmarking valuations against actual prices received when a sale of shares is made, as well as taking account of liquidity issues and/or any restrictions over investments.
and a sale may require the consent of other interested parties. Such investments may therefore be difficult to value and realise. Such realisations may involve significant time and cost and/or result in realisations at levels below the value of such
investments as estimated by the Company. Valuations are often based on comparator prices and market-based multiples, which can be affected by equity market sentiment and comparators’ situations that may not reflect the individual positions of companies
invested in.
Key person risk There is a risk that the individuals responsible for managing the portfolio may leave their employment or may be prevented from undertaking their duties. The Board manages this risk by: • receiving reports from AFML at each Board meeting, such reports include any significant changes in the make-up of the team supporting the Company; • delegating to the Management Engagement & Remuneration Committee oversight of the remuneration of employees of AFML; • meeting the wider team, outside the designated lead managers, at the Portfolio Manager’s offices and by video conference, and encouraging the participation of the wider AFML team in investor updates; and • delegating to the Management Engagement & Remuneration Committee responsibility to perform an annual review of the service received from AFML, including, inter alia , the team supporting the lead managers and succession planning.
Credit Risk As noted the Company may hold significant cash balances. There is a risk that the banks with which the cash is deposited fail and the Company could be adversely affected through either delay in accessing the cash deposits or the loss of the The Board has agreed prudent cash management guidelines with the AIFM to ensure an appropriate risk/return profile is maintained. Cash and cash equivalents are held with approved counterparties, who are required to have a high credit rating and financial strength. Compliance with these guidelines is monitored regularly and reported to the Board on a quarterly basis.
cash deposit. When evaluating counterparties there can be no assurance that the review will reveal or highlight all relevant facts and circumstances that may be necessary or helpful in evaluating the creditworthiness of the counterparty.
Operational Risk The Board is reliant on the systems of the Group and Company’s service providers and as such disruption to, or a failure of, those systems could lead to a failure to comply with law and regulations leading to reputational damage and/or To manage these risks the Board: • receives compliance reports from the AIFM and the Portfolio Manager, which include, inter alia, details of compliance with applicable laws and regulations; • reviews internal control reports, where available, key policies, including measures taken to combat cybersecurity issues, and also the disaster recovery procedures of its service providers; • maintains a risk matrix with details of risks to which the Group and Company are exposed, the controls relied on to manage those risks and the frequency of operation of the controls; and • receives updates on pending changes to the regulatory and legal environment and progress towards the Group and Company’s compliance with these.
financial loss to the Group and/or Company.
Emerging Risks
The Company has carried out a robust assessment of the Company’s emerging
and principal risks and the procedures in place to identify emerging risks are
described below. The International Risk Governance Council definition of an
‘emerging’ risk is one that is new, or is a familiar risk in a new or
unfamiliar context or under new context conditions (re-emerging). Failure to
identify emerging risks may cause mitigating actions to be reactive rather
than being proactive and, in the worst case, could cause the Company to become
unviable or otherwise fail or force the Company to change its structure,
objective or strategy.
The Audit Committee reviews the risk map at least half-yearly. Emerging risks
are discussed in detail as part of this process and also throughout the year
to try to ensure that emerging (as well as known) risks are identified and, so
far as practicable, mitigated.
The experience and knowledge of the Directors are useful in these discussions,
as are update papers and advice received from the Board’s key service
providers such as the Portfolio Manager, the AIFM and the Company’s Brokers.
In addition, the Company is a member of the AIC, which provides regular
technical updates as well as drawing members’ attention to forthcoming
industry and/or regulatory issues and advising on compliance obligations.
Ukraine and Middle East
The Board does not expect the conflicts in Ukraine and the Middle East to have
a material impact on the Company, but notes that two of the Company’s
investments, Wematch and Kipp, are based in Israel. The Board continues to
monitor events in both theatres. The Company has not identified any sanctioned
shareholders on its share register and the portfolio companies have no Russian
operations.
ESG
As mentioned above under Investment Risks, the Board recognises the risks
posed by environmental, social and governance (“ESG”) factors,
particularly with respect to the portfolio. Investment companies are currently
exempt from reporting under the Task Force on Climate-Related Financial
Disclosures (“TCFD”) and the Company has not voluntarily adopted the
requirements, but recognises the potential for reputational risk should the
Company not meet investor expectations in relation to ESG. This, together with
ESG factors that might affect portfolio companies, is considered to be an
emerging risk area for the Company. ESG risk assessment is embedded in the
Portfolio Manager's due diligence and decision-making process when investing
in new companies and monitored thereafter (see page 29). However, the Company
does not have explicit sustainability investment objectives or policies and
will not seek to apply a sustainability label under the FCA’s UK
Sustainability Disclosure Requirements and investment labels regime
(“SDR”).
Performance and Prospects
Performance
The Board assesses the Company’s performance relative to its investment
objective using the following Key Performance Indicators (“KPIs”). Due to
the unique nature and investment policy of the Company, with no direct listed
competitors or comparable indices, the Board considers that there is no
relevant external comparison against which to assess the KPIs and as such
performance against the KPIs is considered on an absolute basis. Information
on the Company’s performance is provided in the Chairman’s Statement and
the Portfolio Manager’s Review. The KPIs have not changed from the prior
year:
• The Net Asset Value (“NAV”) per share after performance fee total
return*
The Directors regard the NAV per share after performance fee total return as
being the critical measure of value delivered by the Company over the long
term. The Board considers that the NAV per share after performance fee better
reflects the current value of each share than the consolidated NAV per share
figure, the calculation of which eliminates the performance fee.
This is an Alternative Performance Measure (“APM”) and its calculation is
explained in the Glossary on page 78 and in note 16 on page 65. Essentially,
it adds back distributions made in the period to the change in the NAV after
performance fee to arrive at a total return.
The Group’s NAV per share after performance fee total return for the year
was 5.4% (2023: 2.4%). This result is discussed in the Chairman's Statement on
page 2.
• The Total Shareholder Return (“TSR”)*
The Directors also regard the Company’s TSR as a key indicator of
performance. Like the NAV per share after performance fee total return
discussed above, this is an APM and its calculation is explained in the
Glossary on page 79. The TSR is similar in nature to the NAV per share after
performance fee total return, except that it adds back distributions made in
the period to the change in the share price, to reflect more closely the
return in the hands of shareholders. Share price performance is monitored
closely by the Board.
The Company's TSR for the year was +3.6% (2023: negative 27.1%). Whilst this
is broadly consistent with the NAV per share total return for the year, the
share price remains under pressure following the swing in market sentiment in
2022.
• Ongoing Charges Ratio (“OCR”)*
Ongoing charges represent the costs that shareholders can reasonably expect to
pay from one year to the next, under normal circumstances.
The Board reviews the costs incurred in operating the Company at each Board
meeting and seeks to maintain a sensible balance between strong service and
keeping costs down.
The terms of appointment of the Company’s AIFM and the Portfolio Manager are
set out on pages 24 and 25. In reviewing their continued appointment the Board
took into account the ongoing charges ratio of other investment companies with
specialist mandates.
The Group’s OCR for the year was 2.0% (2023: 1.9%).
*See Glossary on page 78
Discount/Premium*
The Board monitors the price of the Company's shares in relation to their net
asset value after performance fee and the premium/discount at which the shares
trade. Shareholder approvals are sought each year to issue and buy back
shares, which can assist in reducing share price volatility. However, the
level of discount or premium is understood to be mostly a function of investor
sentiment and demand for the shares, over which the Board has little
influence. The Company has the same Portfolio Manager, management fee
arrangements and cost base that it had in 2021 when the shares traded at a
premium to NAV and the Board does not believe that Company specific factors
have influenced the discount. Rather, the share price falling to a discount to
NAV at the beginning of 2022 correlates with market sentiment turning against
growth stocks generally, with the Company's shares being affected
notwithstanding the portfolio’s potential. The year under review saw little
improvement.
The Board has sought to communicate its faith in the underlying value of the
portfolio and simultaneously to take advantage of the discount by continuing
to undertake a limited programme of accretive share buybacks, to the benefit
of remaining shareholders, whilst balancing the need to retain cash for new
and follow-on investments. It is thought that helping to create some
additional market liquidity for sellers in this way also had an effect on
stabilising the share price. All shares purchased are held in treasury and
will potentially be reissued when the share price returns to a premium to NAV
after performance fee. Shareholder authorities to issue and buy back shares
are being sought at the forthcoming AGM.
Performance, Prospects and Future developments
The Company’s current position and prospects are described in the
Chairman’s Statement and Portfolio Manager’s Review sections of this
annual report.
The Board’s primary focus is on the Portfolio Manager’s investment
approach and performance, which are thoroughly discussed at every Board
meeting. In addition, the AIFM, the Portfolio Manager and the Company’s
Brokers update the Board on company communications, promotion, investor
feedback and market background.
Outlines of performance, investment activity and strategy, market background
during the year and outlook are provided in the Chairman’s Statement on
pages 2 to 4 and the Portfolio Manager’s Review on pages 15 to 18.
Viability Statement
The Board has considered the Company’s financial position, including its
ability to liquidate portfolio assets and meet its expenses as they fall due,
and notes the following:
As part of its review the Board considered the impact of a significant and
prolonged decline in the Company’s performance and prospects. This included
modelling the impact of a 50% fall in the value of the investment portfolio,
the impact of this on the Company’s ongoing charges and reviewing the
ability of the Company to meet its liabilities as they fall due and support
investee companies with future funding requirements in such a scenario.
The expenses of the Company are predictable and modest in comparison with the
assets and there are no capital commitments currently foreseen which would
alter that position.
In considering the Company's longer-term viability, as well as considering the
principal risks on pages 19 to 22 and the financial position of the Company,
the Board considered the following factors and assumptions:
• The Company is and will continue to be invested primarily in long-term
illiquid investments which are not publicly traded;
• The Board reviews the liquidity of the Company, regularly considers any
commitments it has and cash flow projections;
• The Board, AIFM and Portfolio Manager will continue to adopt a long-term
view when making investments and anticipated holding periods will be at least
five years;
• As detailed in the Directors’ Report, the Valuations Committee oversees
the valuation process;
• There will continue to be demand for investment trusts;
• Regulation will not increase to a level that makes running the Company
uneconomical; and
• The performance of the Company will continue to be satisfactory.
Whilst acknowledging that market and economic uncertainty remain heightened in
view of inflation, concerns about a recession and the Ukraine and Middle East
conflicts, based on the results of its review, and taking into account the
long-term nature of the Company, the Board has a reasonable expectation that
the Company will be able to continue its operations and meet its expenses and
liabilities as they fall due for the foreseeable future, taken to mean at
least the next five years. The Board has chosen this period because, whilst it
has no information to suggest this judgement will need to change in the coming
five years, forecasting over longer periods is imprecise. The Board’s
long-term view of viability will, of course, be updated each year in the
annual report.
Going Concern
In light of the conclusions drawn in the foregoing Viability Statement and as
set out in note 19.1 to the financial statements on page 66, the Company has
adequate financial resources to continue in operational existence for at least
the next 12 months from the date of signing of this report.
Therefore, the Directors believe that it is appropriate to continue to adopt
the going concern basis in preparing the financial statements. In reviewing
the position as at the date of this report, the Board has considered the
guidance on this matter issued by the Financial Reporting Council.
Management Arrangements
Principal Service Providers
The Company is structured as an internally managed closed-ended investment
company. Augmentum Fintech Management Limited (“Portfolio Manager”) is the
wholly owned operating subsidiary of the Company that manages the investment
portfolio of the Company as a delegate of the AIFM.
The other principal service providers to the Company are Frostrow Capital LLP
(“Frostrow” or the “AIFM”) and IQ EQ Depositary Company (UK) Limited
(the “Depositary”). Details of their key responsibilities and their
contractual arrangements with the Company follow.
Alternative Investment Fund Manager (“AIFM”)
Frostrow, under the terms of its AIFM agreement with the Company, provides,
inter alia, the following services:
• oversight of the portfolio management function delegated to Augmentum
Fintech Management Limited;
• promotion of the Company’s shares;
• investment portfolio administration and valuation;
• risk management services;
• share price discount and premium monitoring;
• administrative and company secretarial services;
• advice and guidance in respect of corporate governance requirements;
• maintenance of the Company’s accounting records;
• review of the Company’s website;
• preparation and publication of annual and half year reports; and
• ensuring compliance with applicable legal and regulatory requirements.
AIFM Fees
Under the terms of the AIFM Agreement Frostrow is entitled to an annual fee
of:
• on NAV up to £150 million: 0.225% per annum;
• on that part of NAV in excess of £150 million and up to £500 million:
0.2% per annum; and
• on that part of NAV in excess of £500 million: 0.175% per annum,
calculated on the last working day of each month and payable monthly in
arrears.
The AIFM Agreement may be terminated by either party on giving notice of not
less than 12 months.
Portfolio Manager
Augmentum Fintech Management Limited, as delegate of the AIFM, is responsible
for the management of the Company’s portfolio of investments under an
agreement between it, the Company and Frostrow (the “Portfolio Management
Agreement”).
Under the terms of its Portfolio Management Agreement, Augmentum Fintech
Management Limited provides, inter alia, the following services:
• seeking out and evaluating investment opportunities;
• recommending the manner by which monies should be invested, disinvested,
retained or realised;
• advising on how rights conferred by the investments should be exercised;
• analysing the performance of investments made; and
• advising the Company in relation to trends, market movements and other
matters which may affect the investment objective and policy of the Company.
Portfolio Manager Fees
Portfolio Management Fee
Under the terms of the Portfolio Management Agreement Augmentum Fintech
Management Limited (the “Portfolio Manager”) receives an annual fee of
1.5% of the NAV per annum, falling to 1.0% of any NAV in excess of £250
million.
Performance Fee
The Portfolio Manager is entitled to a performance fee in respect of the
performance of any investments and follow-on investments. Each performance fee
operates in respect of investments made during a 24 month period and related
follow-on investments made for a further 36 month period, save that the first
performance fee would be in respect of investments acquired using 80% of the
net proceeds of the Company’s IPO in March 2018 (including the Initial
Portfolio), and related follow-on investments.
Subject to certain exceptions, the Portfolio Manager receives, in aggregate,
15% of the net realised cash profits from the investments and follow-on
investments made over the relevant period once the Company has received an
aggregate annualised 10% realised return on investments (the “hurdle”) and
follow-on investments made during the relevant period. The Portfolio
Manager’s return is subject to a ‘’catch-up’’ provision in its
favour. The performance fee is paid in cash as soon as practicable after the
end of each relevant period, save that at the discretion of the Board payments
of the performance fee may be made in circumstances where the relevant basket
of investments has been realised in part, subject to claw-back arrangements in
the event that payments have been made in excess of the Portfolio Manager’s
entitlement to any performance fees as calculated following the relevant
period.
Based on the investment valuations as at 31 March 2024 the hurdle has been
met, on an unrealised basis, and as such a performance fee has been provided
for as set out in notes 2 and 12. This will only be payable if the hurdle is
met on a realised basis.
The Portfolio Management Agreement may be terminated by either party giving
notice of not less than 12 months.
AIFM and Portfolio Manager Evaluation and Re-Appointment
The performance of Frostrow as AIFM and Augmentum Fintech Management Limited
as Portfolio Manager is regularly monitored by the Board with a formal
evaluation being undertaken each year. As part of this process the Board
monitors the services provided by the AIFM and the Portfolio Manager and
receives regular reports and views from them.
Following a review at a Management Engagement & Remuneration Committee meeting
in March 2024 the Board believes that the continuing appointment of the AIFM
and the Portfolio Manager, under the terms described within this Strategic
Report, is in the best interests of the Company’s shareholders. In coming to
this decision it took into consideration the following additional reasons:
• the quality and depth of experience of the management, company
secretarial, administrative and marketing team that the AIFM brought to the
management of the Company; and
• the quality and depth of experience allocated by the Portfolio Manager to
the management of the portfolio, together with the clarity and rigour of the
investment process.
Depositary
The Company has appointed IQ EQ Depositary (UK) Limited as its Depositary in
accordance with the UK AIFMD on the terms and subject to the conditions of an
agreement between the Company, Frostrow and the Depositary (the “Depositary
Agreement”).
The Depositary provides the following services, inter alia, under its
agreement with the Company:
• verification of non-custodial investments;
• cash monitoring;
• processing of transactions; and
• foreign exchange services.
The Depositary must take reasonable care to ensure that the Company is managed
in accordance with the Financial Conduct Authority’s Investment Funds
Sourcebook, the UK AIFMD and the Company’s Articles of Association.
Under the terms of the Depositary Agreement, the Depositary is entitled to
receive an annual fee of £25,000 plus certain event driven fees.
The notice period on the Depositary Agreement is not less than six months.
Registrar
The Company’s registrar is Computershare Investor Services PLC. Contact
details are set out on page 80.
Dividend Policy
The Company invests with the objective of achieving capital growth over the
long term and it is not expected that a revenue dividend will be paid in the
foreseeable future. The Board intends only to pay dividends out of revenue to
the extent required in order to maintain the Company’s investment trust
status.
Potential returns of capital
It is expected that the Company will realise investments from time to time.
The proceeds of these disposals may be re-invested, used for working capital
purposes or, at the discretion of the Board, returned to shareholders.
The Company has committed to return to Shareholders up to 50 per cent. of the
gains realised by the disposal of investments in each financial year, with
such returns of capital expected to be made on an annual basis. The Company
may also seek to make returns of capital to Shareholders where available cash
is not expected to be substantially deployed within the following 12-18
months. The options for effecting any return of capital to shareholders may
include the Company making tender offers to purchase Shares, paying special
dividends or any alternative method or a combination of methods. Certain
methods intended to effect a return of capital may be subject to, amongst
other things, shareholder approval. Shareholders should note that the return
of capital by the Company is at the discretion of the Directors and is subject
to, amongst other things, the working capital requirements of the Company. The
Board has affirmed, that the Company will continue to retain the bulk of the
proceeds of the investment realisations to date for reinvestment to support
its capital growth objective and utilise the balance to support accretive
share buybacks.
Company Promotion
The Company has retained the services of Peel Hunt LLP and Singer Capital
Markets Advisory LLP as joint corporate brokers, to work alongside one another
to encourage demand for the Company’s shares. Additionally, the Company has
engaged Quill PR to assist in promoting the Company.
Further, in addition to AIFM services, Frostrow also provides investor
relations & marketing services.
Engaging regularly with investors:
The Company’s brokers and Frostrow meet with institutional investors,
discretionary wealth managers and execution-only platform providers around the
UK and hold regular seminars and other investor events;
Making Company information more accessible:
Frostrow manages the investor database and produces all key corporate
documents, distributes factsheets, annual reports and updates from the
Portfolio Manager on portfolio and market developments; and
Monitoring market activity, acting as a link between the Company, shareholders
and other stakeholders:
The Company’s brokers and Frostrow maintain regular contact with sector
broker analysts and other research and data providers, and provide the Board
with up-to-date information on the latest shareholder and market developments.
Community, Social, Employee, Human Rights, Environmental Issues, Anti-bribery
and Anti-corruption
The Company is committed to carrying out business in an honest and fair manner
with a zero-tolerance approach to bribery, tax evasion and corruption. As
such, policies and procedures are in place to prevent bribery and corruption.
In carrying out its activities, the Company aims to conduct itself
responsibly, ethically and fairly, including in relation to social and human
rights issues.
As an investment trust with limited internal resource, the Company has little
impact on the environment. The Company believes that high ESG (Environmental,
Social and Governance) standards within both the Company and its portfolio
companies make good business sense and have the potential to protect and
enhance investment returns. Consequently, the Group’s investment process
ensures that ESG issues are taken into account and best practice is
encouraged.
Diversity
There are currently three male and two female Directors (being 40% female
representation) on the Board, and these Directors have three different
nationalities and diverse educational backgrounds. The Company aims to have a
balance of relevant skills, experience and background amongst the Directors on
the Board and believes that all Board appointments should be made on merit and
with due regard to the benefits of diversity. The Company's diversity policy
is set out on pages 41 and 42. The Board also encourages diversity within
AFML, where the team of 12 people represents four different nationalities and
is 42% female. The Board is also keen to promote the benefits of diversity in
the companies we invest in.
Engaging with our stakeholders
The following ‘Section 172’ disclosure describes how the Directors have
had regard to the views of the Company’s stakeholders in their
decision-making.
Who? Why? THE BENEFITS OF ENGAGEMENT WITH OUR STAKEHOLDERS How?
STAKEHOLDER GROUP HOW THE BOARD THE AIFM AND THE PORTFOLIO MANAGER HAS ENGAGED WITH OUR STAKEHOLDERS
Investors Clear communication of the Company’s strategy and the performance against its objective can help the share price trade at a narrower discount or a wider premium to its net asset value which benefits shareholders. New shares may be issued to meet demand without diluting the NAV per share of existing shareholders. Increasing the size of the Company can benefit liquidity as well as spread costs. Understanding investor preferences in relation to potential Board decisions, such as in relation to possible distributions. Frostrow as AIFM, the Portfolio Manager and the Company’s joint brokers on behalf of the Board complete a programme of investor relations throughout the year. In
addition, the Chairman endeavours to make himself available to meet with shareholders wishing to engage. Key mechanisms of engagement included: • The Annual General
Meeting; • The Company’s website which hosts reports, video interviews with the managers and regular market commentary; • Online newsletters; • One-on-one investor
meetings; • Investor meetings with the Portfolio Manager and AIFM; and • The Portfolio Manager hosts an annual Capital Markets Day event to inform investors about
portfolio constituents.
Portfolio Manager Engagement with our Portfolio Manager is necessary to evaluate performance against the stated strategy and to understand any risks or opportunities this may present to the Company. It also provides clarity on the Board’s expectations and helps ensure that portfolio management costs are closely monitored and remain competitive. The Board meets regularly with the Company’s Portfolio Manager throughout the year both formally at the quarterly Board meetings and more regularly on an informal basis.
The Board also receives quarterly performance and compliance reporting at each Board meeting. The Portfolio Manager’s attendance at each Board meeting provides the
opportunity for the Portfolio Manager and Board to further reinforce their mutual understanding of what is expected from all parties.
Service Providers The Company contracts with third parties for other services including: depositary, investment accounting & administration, company secretarial and share registration. It is necessary for the Company's success to ensure the third parties to whom we have outsourced services complete their roles diligently and correctly. The Company ensures all service providers are paid in accordance with their terms of business. The Board closely monitors the Company’s Ongoing Charges Ratio. The Board and Frostrow engage regularly with all service providers both in one-to-one meetings and via regular written reporting. This regular interaction provides an
environment where topics, issues and business development needs can be dealt with efficiently and collegiately.
Employees of AFML In order to attract and retain talent to ensure the Group has the resources to successfully implement its strategy and manage third-party relationships. AFML has an open plan office, facilitating ready interaction and engagement. Senior team members report to the Board at each meeting. Given the small number of employees,
engagement is at an individual level rather than as a group.
Portfolio companies Incorporating consideration of ESG factors into the investment process assists in understanding and mitigating risks of an investment and potentially identifying future opportunities. The Board encourages the Company’s Portfolio Manager to engage with companies and in doing so expects ESG issues to be a key consideration. The Portfolio Manager seeks to
take a board seat, or have board observer status, on all investments. See pages 29 to 31 for further detail on AFML’s ESG approach to investing.
What? WHAT WERE THE KEY TOPICS OF ENGAGEMENT? Outcomes and Actions WHAT ACTIONS WERE TAKEN, INCLUDING PRINCIPAL DECISIONS?
Key topics of engagement with investors Ongoing dialogue with shareholders concerning the strategy of the Company, performance and the portfolio. • The Portfolio Manager, Frostrow and the joint brokers meet regularly with shareholders and potential investors to discuss the Company’s strategy, performance and portfolio. These meetings take place with and without the Portfolio Manager.
Key topics of engagement with the Portfolio Manager On an ongoing basis the Board engages on portfolio composition, performance, outlook and business updates. Additional topics included: • The impact of market conditions upon their business and the portfolio. • The impact of the Ukraine and Middle East conflicts upon their business and the portfolio. • Compensation arrangements within AFML. • The structure of management arrangements. • The discount at which the Company’s shares have been trading and thoughts on possible mitigations. • The prospects for the portfolio and the pipeline of potential investment opportunities are of particular interest to the Board and discussions during the year resulted in the Board being provided with additional reports to aid visibility. • The Ukraine
and Middle East conflicts were discussed and it was concluded that they have no direct impact on the Company. Two portfolio companies are based in Israel and have been able to continue operations. • The portfolio manager reports regularly any ESG issues in
the portfolio companies to the Board. Please see pages 29 to 31 for further details of AFML’s ESG policies. • The structure of management arrangements has been an area of focus during the year and discussions about this are ongoing. • Discussions informed
Board decisions in relation to continuation of the current share buyback programme and balancing this with available investment capital.
Approach to Responsible Investing
Augmentum Fintech Management Limited (“AFML”) continues to be committed to
a responsible investment approach through the lifecycle of its investments,
from pre-screening to exit. AFML believes that the integration of
Environmental, Social and Governance (“ESG”) factors within the investment
analysis, diligence and operating practices is important for mitigating risk
and making profitable investments.
Five-Stage Approach to Future-Proofing the Portfolio
ESG principles adapted from the UN PRI (Principles of Responsible Investment)
are integrated throughout business operations; in investment decisions, at the
screening stage through an exclusion list and due diligence, ongoing
monitoring and engaging with portfolio companies post-investment and when
making follow-on investment decisions, as well as within fund operations.
1. Screening
An Exclusion List is used to screen out companies incompatible with AFML’s
corporate values (sub-sectors and types of business). AFML also commits to
being satisfied that the investors they invest alongside are of good standing.
2. Due Diligence
An ESG Due Diligence (DD) survey is completed by teams from companies in the
later stages of the investment process. An ESG scorecard is completed for each
potential investment, in which potential ESG risks and opportunities are
identified, and discussed with the investment committee. Where necessary, an
action plan is agreed with the management team on areas for improvement and
commitments are incorporated into the Term Sheet.
3. Post-Investment Monitoring and Engagement
An annual survey is completed by portfolio companies and areas for improvement
are discussed with management teams, with commitments agreed and revisited as
appropriate.
4. Follow On Investments
ESG risks and opportunities are assessed when making follow-on investment
decisions, with an ESG scorecard completed and co-investors taken into
consideration. Follow on investments are only made into companies that
continue to meet AFML’s ESG criteria.
5. Internally at Augmentum
AFML has continued to identify priority areas in which to make suitable
ESG-related advancements across fund operations. Key progress areas include:
• Tracking the gender diversity of founders/CEOs of companies in our
dealflow;
• Continuing to embrace diversity and inclusion through inclusive hiring
and professional development practices and Female Founder Office Hours;
• Building on our programme of CSR initiatives through supporting Crisis
Venture Studio and The Lord Mayor's Appeal ‘We Can Be’ and ‘City Giving
Day’ initiatives.
ESG Focus Areas
AFML has identified eight key areas for consideration, across the three ESG
categories, which best align with its values and are most relevant for
companies operating in the fintech industry.
The key environmental consideration as identified by the AFML is the potential
impact of business operations on the global issue of climate change. Social
factors include the risks and opportunities associated with data security,
privacy and ethical use, consumer protection, diversity and financial
inclusion. Governance considerations include anti-bribery and corruption,
board structure and independence and compliance.
AFML is committed to:
• Incorporating ESG and sustainability considerations into its investment
analysis, diligence, and operating practices.
• Providing ESG training and support to the AFML employees involved in the
investment process, so that they may perform their work in accordance with
AFML’s policy.
• Actively engaging with portfolio companies to encourage improvement in
key ESG areas.
• Annual reporting on progress to stakeholders.
ESG in Action
Company Initiatives
Investing in Women Code (ESG Focus Area – Social: Diversity)
Augmentum is a signatory of the Investing in Women Code. The Investing in
Women Code is a commitment to support the advancement of female
entrepreneurship in the United Kingdom by improving female entrepreneurs’
access to tools, resources and finance from the financial services sector.
As a signatory to the Investing in Women Code, the Company is committed to a
culture of inclusion and to advance access to capital for female
entrepreneurs. As a signatory, the Company will:
• Have a nominated member of the senior leadership team who is responsible
for supporting equality in all its interactions with entrepreneurs.
• Provide HM Treasury with a commonly agreed set of data concerning:
all-female-led businesses; mixed-gender-led businesses and all-male-led
businesses. The Company agrees that HM Treasury will collate this data and
publish it on an aggregated and anonymised basis in an annual report.
• Adopt internal practices which aim to improve the potential for female
entrepreneurs to successfully access the tools, resources, investment and
finance they need to build and grow their businesses, working with relevant
players in the ecosystem. The Company will review these actions annually and
make this commitment publicly available.
The Lord Mayor’s Appeal (Environmental: climate/carbon footprint and Social:
Diversity)
In September the Augmentum team took part in The Lord Mayor’s Appeal’s
‘City Giving Day’, entering a cycling challenge raising money for the
various charitable causes supported by The Lord Mayor’s Appeal.
The Augmentum team participates in The Lord Mayor’s Appeal ‘We Can Be’
initiative, hosting a group of school girls, introducing them to a career in
the City and the inner workings of an investment trust.
Female Founders in Fintech Office Hours (Social: Diversity)
Augmentum launched Female Fintech Founders monthly Office Hours along with
other fintech investors Outward and Portage, providing an opportunity for
early stage female fintech founders to speak with leading fintech investors
and discuss fundraising and business scaling more broadly. 25 founders were
selected and hosted across the first three sessions. Augmentum also
participates in Playfair’s ‘Female Office Hours’, the largest diversity
and inclusion initiative in venture to bring founders and investors together
for one-to-one mentoring and pitch meetings.
Portfolio Business Models
Anyfin: Consumer Financial Education (Social: Consumer protection)
A core element of Anyfin’s mission is to help get people out of debt and to
date the company has helped customers save millions of Euros in credit costs.
They are proactive with consumer financial education; earlier this year they
released the third edition of the Anyfin Report, a financial health study
conducted by YouGov. The report focused on the ways in which people are
planning to deal with their debts (and finances more broadly) in 2023. The
company hosts regular ‘Anyfin House’ sessions, open to the public, and
covering topics such as financial management, financial stress and the
economy.
Grover: Circular Economy Model (Environmental: Climate/carbon footprint)
Grover provides a sophisticated solution for the increasing number of
consumers who value access over ownership via their circular economy
tech-rental model. By replacing the highly wasteful linear product ownership
approach (take -> make -> dispose), Grover’s model extends the lifecycle of
a product by re-using, repairing and redistributing. A device rented from
Grover is circulated 2-6 times on average, and as of 2023 the company has
circulated over 1 million devices.
Wayhome: Gradual Home Ownership Model (Social: Financial inclusion)
Wayhome’s ‘Gradual Homeownership’ model aims to help aspiring homeowners
who are unable to obtain a traditional mortgage to buy a home get on the
housing ladder. With the average home now costing 9 times average income and
the average first time buyer only able to borrow 3.55 times income, millions
of hardworking families are locked out of homeownership. Wayhome customers own
the share of the home they paid for and rent the remainder, gradually buying
more and renting less over time.
Portfolio Initiatives
Farewill: Charity Pledge (Social)
Farewill partners with charities to enable them to offer free will writing
services through their website. In May 2024, Farewill announced they had hit
£1 billion in legacy pledges for charity..
Tide: (Environmental: Climate/carbon footprint)
In March, Tide became the first fintech globally to remove 100% of its
emissions with durable carbon removals as of 2022 onwards. The business has
also committed to becoming fully NetZero by 2030 and to support its UK members
(more than 9% of UK SMEs), and growing network of Indian SMEs on their journey
to NetZero.
Tide made three climate-focused pledges which included committing to removing
100% of their emissions with durable carbon removal from 2022 onwards and
reducing 90% of their 2021 emissions per employee by 2030. These would make
Tide fully Net Zero by 2030. The organisation also committed to making Net
Zero simpler for their Members by developing the support on offer.
Post-period end Tide and Transcorp announced the launch of India’s-first
recycled PVC RuPay Card. Made from 99% recycled plastic, this is a first for
fintechs in India. Each rPVC card saves 7g of carbon and 3.18g plastic that
would normally be used in production.
Zopa Bank: 2025 Fintech Pledge (Social: Consumer protection and financial
inclusion)
Led by Zopa Bank, 33 fintechs and their industry partners are working together
to tackle the cost-of-living crisis. The 2025 Fintech Pledge aims to drive 10
million consumer actions that build up the financial resilience of UK
consumers by 2025. It will achieve this by connecting people to platforms
that make savings work harder, improve credit scores, consolidate debt, and
lower utility bills and household outgoing costs. To date, more than 2 million
actions have been reported from all members combined.
This Strategic Report was approved by the Board of Directors and signed on its
behalf by:
Neil England
Chairman
24 June 2024
.
STATEMENT OF DIRECTORS’ RESPONSIBILITIES IN RESPECT OF THE ANNUAL REPORT,
THE DIRECTORS’ REMUNERATION REPORT AND THE FINANCIAL STATEMENTS
The directors are responsible for preparing the annual report and financial
statements in accordance with United Kingdom applicable law and regulations.
Company law requires the directors to prepare financial statements for each
financial year. Under that law the directors have prepared the Group and
Company financial statements in accordance with UK-adopted international
accounting standards. Under Company law the directors must not approve the
financial statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Group and Company and of the return or
loss for the Group and Company for that period.
In preparing these group financial statements, the directors are required to:
• Select suitable accounting policies and then apply them consistently;
• Make judgements and accounting estimates that are reasonable and prudent;
• State whether they have been prepared in accordance with UK-adopted
international accounting standards, subject to any material departures
disclosed and explained in the financial statements;
• Prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the Company will continue in business; and
• Prepare a directors’ report, a strategic report and directors’
remuneration report which comply with the requirements of the Companies Act
2006.
The directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Group and Company’s transactions and
disclose with reasonable accuracy at any time the financial position of the
Group and Company and enable them to ensure that the financial statements
comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the Group and the
Company and hence for taking reasonable steps for the prevention and detection
of fraud and other irregularities.
Responsibility Statement
The Directors consider that this annual report and financial statements, taken
as a whole, is fair, balanced, and understandable and provides the information
necessary for shareholders to assess the Group and Company’s position and
performance, business model and strategy.
Each of the Directors, whose names and functions are listed under the ‘Board
of Directors’ on page 32 confirm that, to the best of their knowledge:
• The financial statements, prepared in accordance with applicable
accounting standards, give a true and fair view of the assets, liabilities,
financial position and profit of the Group and Company;
• The annual report includes a fair review of the development and
performance of the business and the financial position of the Group and
Company, together with a description of the principal risks and uncertainties
that they face.
Neil England
Chairman
24 June 2024
.
CONSOLIDATED INCOME STATEMENT
Year ended 31 March 2024 Year ended 31 March 2023
Notes Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Gains on Investments 8 – 17,602 17,602 – 9,858 9,858
Interest Income 1,681 – 1,681 412 – 412
Expenses 2 (5,432) (49) (5,481) (5,270) (107) (5,377)
(Loss)/Return before Taxation (3,751) 17,553 13,802 (4,858) 9,751 4,893
Taxation 6 – – – – – –
(Loss)/Return for the year (3,751) 17,553 13,802 (4,858) 9,751 4,893
(Loss)/Return per Share (pence) 7 (2.2)p 10.3p 8.1p (2.7)p 5.4p 2.7p
The total column of this statement represents the Group’s Consolidated
Income Statement, prepared in accordance with IFRS as adopted by the UK.
The revenue and capital columns are supplementary to this and are prepared
under guidance published by the Association of Investment Companies.
The Group does not have any other comprehensive income and hence the total
return, as disclosed above, is the same as the Group’s total comprehensive
income.
All items in the above statement derive from continuing operations.
All returns are attributable to the equity holders of Augmentum Fintech plc,
the parent company.
The notes on pages 58 to 68 are integral to and form part of these Financial
Statements.
.
CONSOLIDATED AND COMPANY STATEMENTS OF CHANGES IN EQUITY
Year ended 31 March 2024
Group Ordinary Share Special Other Revenue Total
share premium reserve capital reserve £’000
capital account £’000 reserve £’000
£’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 85,218 117,740 (16,027) 294,124
Purchase of own shares into treasury – – (4,609) – – (4,609)
Return/(loss) for the year – – – 17,553 (3,751) 13,802
At 31 March 2024 1,810 105,383 80,609 135,293 (19,778) 303,317
Year ended 31 March 2023
Group Ordinary Share Special Other Revenue Total
share premium reserve capital reserve £’000
capital account £’000 reserve £’000
£’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 91,191 107,989 (11,169) 295,204
Purchase of own shares into treasury – – (5,973) – – (5,973)
Return/(loss) for the year – – – 9,751 (4,858) 4,893
At 31 March 2023 1,810 105,383 85,218 117,740 (16,027) 294,124
Year ended 31 March 2024
Company Ordinary Share Special Other Revenue Total
share premium reserve capital reserve £’000
capital account £’000 reserve £’000
£’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 85,218 100,919 (17,576) 275,754
Purchase of own shares into treasury – – (4,609) – – (4,609)
Return/(loss) for the year – – – 15,392 (3,805) 11,587
At 31 March 2024 1,810 105,383 80,609 116,311 (21,381) 282,732
Year ended 31 March 2023
Company Ordinary Share Special Other Revenue Total
share premium reserve capital reserve £’000
capital account £’000 reserve £’000
£’000 £’000 £’000
Opening Shareholders’ funds 1,810 105,383 91,191 92,724 (12,556) 278,552
Purchase of own shares into treasury – – (5,973) – – (5,973)
Return/(loss) for the year – – – 8,195 (5,020) 3,175
At 31 March 2023 1,810 105,383 85,218 100,919 (17,576) 275,754
The notes on pages 58 to 68 are integral to and form part of these Financial
Statements.
.
CONSOLIDATED BALANCE SHEET
as at 31 March 2024
Note 2024 2023
£’000 £’000
Non-Current Assets
Investments held at fair value 8 265,083 254,295
Property, plant & equipment 219 297
Current Assets
Right-of-use asset 5 438 588
Other receivables 10 245 555
Cash and cash equivalents 38,505 40,015
Total Assets 304,490 295,750
Current Liabilities
Other payables 11 (699) (948)
Lease liability 5 (474) (678)
Total Assets less Current Liabilities 303,317 294,124
Net Assets 303,317 294,124
Capital and Reserves
Called up share capital 15 1,810 1,810
Share premium 105,383 105,383
Special reserve 80,609 85,218
Retained earnings:
Capital reserves 135,293 117,740
Revenue reserve (19,778) (16,027)
Total Equity 303,317 294,124
Net Asset Value per share (pence) 16 178.6p 168.5p
Net Asset Value per share after performance fee (pence)* 16 167.4p 158.9p
The Financial Statements on pages 52 to 68 were approved by the Board of
Directors on 24 June 2024 and signed on its behalf by:
Neil England
Chairman
The notes on pages 58 to 68 are integral to and form part of these Financial
Statements.
Augmentum Fintech plc
Company Registration Number: 11118262
* Considered to be Alternative Performance Measure. Please see the Glossary
and Alternative Performance Measures on page 78.
.
COMPANY BALANCE SHEET
as at 31 March 2024
Note 2024 2023
£’000 £’000
Non-Current Assets
Investments held at fair value 8 265,083 254,295
Investment in subsidiary undertakings 9 750 500
Current Assets
Other receivables 10 196 118
Cash and cash equivalents 36,052 38,470
Total Assets 302,081 293,383
Current Liabilities
Other payables 11 (369) (810)
Provisions 12 (18,980) (16,819)
Total Assets less Current Liabilities 282,732 275,754
Net Assets 282,732 275,754
Capital and Reserves
Called up share capital 15 1,810 1,810
Share premium 105,383 105,383
Special reserve 80,609 85,218
Retained earnings:
Capital reserves 116,311 100,919
Revenue reserve (21,381) (17,576)
Total Equity 282,732 275,754
The Company’s return for the year was £11,587,000 (2023: £3,175,000). The
Directors have taken advantage of the exemption under s408 of the Companies
Act and not presented an income statement or a statement of comprehensive
income for the Company alone.
The Financial Statements on pages 52 to 68 were approved by the Board of
Directors on 24 June 2024 and signed on its behalf by:
Neil England
Chairman
The notes on pages 58 to 68 are integral to and form part of these Financial
Statements.
Augmentum Fintech plc
Company Registration Number: 11118262
.
CONSOLIDATED CASH FLOW STATEMENT
Year Year
ended ended
31 March 31 March
2024 2023
£’000 £’000
Operating activities
Sales of investments 22,790 44,226
Purchases of investments (15,976) (24,855)
Acquisition of property, plant and equipment (8) (365)
Interest income received 1,608 326
Expenses paid (4,552) (5,058)
Lease payments (221) (153)
Net cash inflow from operating activities 3,641 14,121
Purchase of own shares into treasury (5,151) (5,432)
Net cash used by financing activities (5,151) (5,432)
Net (decrease)/increase in cash and cash equivalents (1,510) 8,689
Cash and cash equivalents at start of year 40,015 31,326
Cash and cash equivalents at end of year 38,505 40,015
The notes on pages 58 to 68 are integral to and form part of these Financial
Statements.
.
COMPANY CASH FLOW STATEMENT
Year Year
ended ended
31 March 31 March
2024 2023
£’000 £’000
Operating activities
Sales of investments 22,790 44,226
Purchases of investments (16,226) (24,855)
Interest income received 1,563 326
Expenses paid (5,494) (5,489)
Net cash inflow from operating activities 2,733 14,208
Purchase of own shares into treasury (5,151) (5,432)
Net cash used by financing activities (5,151) (5,432)
Net (decrease)/increase in cash and cash equivalents (2,418) 8,776
Cash and cash equivalents at start of year 38,470 29,694
Cash and cash equivalents at end of year 36,052 38,470
The notes on pages 58 to 68 are integral to and form part of these Financial
Statements.
.
NOTES TO THE FINANCIAL STATEMENTS
1 Segmental Analysis
The Group operates a single business segment for reporting purposes and is
managed as a single investment company. Reporting is provided to the Board of
Directors on an aggregated basis. The investments are located in the UK,
continental Europe, Israel and the US.
2 Expenses
2024 2023
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
AIFM fees 582 – 582 593 – 593
Administrative expenses 1,706 49 1,755 1,415 107 1,522
Directors’ fees* 186 – 186 169 – 169
Performance fee (see note 4)^ – – – – – –
Staff costs (see note 4) 2,793 – 2,793 2,944 – 2,944
Auditor’s remuneration 165 – 165 149 – 149
Total expenses 5,432 49 5,481 5,270 107 5,377
£169,000 of interest and depreciation relating to a lease (2023: £209,000)
is included in administrative expenses. See note 5 for further details.
* Details of the amounts paid to Directors are included in the Directors
Remuneration Report on page 45.
^ See note 4 for further details of the performance fee arrangements.
Non-executive Directors of the Company are not eligible to participate in any
allocation of the performance fee.
Auditor’s Remuneration
2024 2023
Group Company Group Company
£’000 £’000 £’000 £’000
Audit of Group accounts pursuant to legislation 110 110 104 104
Audit of subsidiaries accounts pursuant to legislation 19 – 18 –
Audit related assurance services 26 26 20 20
Non-audit related assurance services 10 – 7 –
Total auditors’ remuneration 165 136 149 124
Non-audit services
It is the Group’s practice to employ BDO LLP on assignments additional to
their statutory audit duties only when their expertise and experience with the
Group are important. Details of the Group’s process for safeguarding and
supporting the independence and objectivity of the external auditor are given
in the Report of the Audit Committee beginning on page 48.
3 Key Management Personnel Remuneration
The Directors of the Company are considered to be the Key Management Personnel
along with the directors of the Company’s subsidiary.
2024 2023
Salary Other Total Salary Other Total
/Fees benefits £’000 /Fees benefits £’000
£’000 £’000 £’000 £’000
Key management personnel remuneration 1,158 125 1,283 1,352 277 1,629
Performance fee allocation* – – – – – –
1,158 125 1,283 1,352 2770 1,629
Other benefits include pension and social security contributions relating to
the directors of the Company’s subsidiary.
* Allocation of the performance fee to the directors of the Company’s
subsidiary. See note 4 for further details of the performance fee
arrangements.
4 Staff Costs
The monthly average number of employees for the Group during the year was
eleven (2023: eleven). All employees are within the investment and
administration function and employed by the Company's subsidiary.
2024 2023
£’000 £’000
Wages and salaries 2,264 2,437
Social security costs 318 347
Other pension costs 119 104
Other staff benefits 92 56
Staff costs 2,793 2,944
Performance fee (charged to capital)* – –
Total 2,793 2,944
* The performance fee arrangements were set up to provide a long-term
employee benefit plan to incentivise employees of AFML and align them with
shareholders through participation in the realised investment profits of the
Group. Any performance fee paid by the Company to AFML is allocated to
employees of AFML on a discretionary basis and overseen by the Management
Engagement & Remuneration Committee of the Company.
The performance fee is payable by the Company to AFML when the Company has
realised an aggregate annualised 10% return on investments (the ‘hurdle’)
in each basket of investments. Based on the investment valuations and the
hurdle level as at 31 March 2024 the hurdle has been met, on an unrealised
basis, and as such a performance fee of £18,980,000 (2023: £16,819,000) has
been provided for by the Company, equivalent to 11.2 pence per share. This
provision is reversed on consolidation and not included in the Group Statement
of Financial Position. The performance fee is only payable to AFML if the
hurdle is met on a realised basis and the actual amount payable will depend on
the amount and timing of investment realisations. See page 25 and note 19.9
for further details.
5 Leases
Leasing activities
The Group, through its subsidiary AFML, has leased an office in the UK from
which it operates for a fixed fee. When measuring lease liabilities for leases
that were classified as operating leases, the Group discounts lease payments
at a rate of 6.4% (2023: 6.4%).
Right-of-Use Asset
2024 2023
Group Group
Office Premises Office Premises
£’000 £’000
As at 1 April 588 750
Depreciation (150) (162)
At 31 March 438 588
Lease Liability
2024 2023
Group Group
Office Premises Office Premises
£’000 £’000
As at 1 April 678 783
Rent free period reduction (21) –
Interest Expense 38 48
Lease Payments (221) (153)
At 31 March 474 678
Maturity Analysis
Group
At 31 March 2024 Up to 3 months 3 – 12 months Between Between
£’000 £’000 1 – 2 years 2 – 5 years
£’000 £’000
Lease payments 60 121 181 181
6 Taxation Expense
2024 2023
For the year ended 31 March Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Current tax:
UK corporate tax on profits for the year – – – – – –
The difference between the income tax expense shown above and the amount
calculated by applying the effective rate of UK corporation tax of 25% (2023:
19%) to the (loss)/return before tax is as follows:
2024 2023
For the year ended 31 March Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
(Loss)/return before taxation (3,751) 17,553 13,802 (4,858) 9,751 4,893
(Loss)/return before tax multiplied by the effective rate of UK corporation tax of 25% (2023: 19%) (938) 4,388 3,450 (923) 1,853 930
Effects of:
Non-taxable capital returns – (4,400) (4,400) – (1,873) (1,873)
Unutilised management expenses 938 12 950 923 20 943
Total tax expense – – – – – –
No provision for deferred taxation has been made in the current year. The
Group has not provided for deferred tax on capital profits arising on the
revaluation of investments, as it is exempt from tax on these items because of
its status as an investment trust company.
The Company has not recognised a deferred tax asset on the excess management
expenses of £36,704,000 (2023: £32,904,000). It is not anticipated that
these excess expenses will be utilised in the foreseeable future.
7 (Loss)/Return per Share
The (loss)/return per share figures are based on the following figures:
2024 2023
£’000 £’000
Net revenue loss (3,751) (4,858)
Net capital return 17,553 9,751
Net total return 13,802 4,893
Weighted average number of ordinary shares in issue 170,877,294 178,651,736
Pence Pence
Revenue loss per share (2.2) (2.7)
Capital return per share 10.3 5.4
Total return per share 8.1 2.7
8 Investments Held at Fair Value
Non-current Investments Held at Fair Value
As at 31 March 2024 2023
Group and Group and
Company Company
£’000 £’000
Unlisted at fair value 265,083 254,295
Reconciliation of movements on investments held at fair value are as follows:
2024 2023
Group and Group and
Company Company
£’000 £’000
As at 1 April 254,295 268,807
Purchases at cost 15,976 19,854
Realisation proceeds (22,790) (44,224)
Gains on investments 17,602 9,858
As at 31 March 265,083 254,295
The Group and Company received £22,790,000 (2023: £44,224,000) from
investments sold in the year. The book cost of these investments when they
were purchased was £10,750,000 (2023: £6,348,000). These investments have
been revalued over time and until they were sold any unrealised gains/losses
were included in the fair value of the investments.
9 Subsidiary undertakings
The Company has an investment of £750,000 (2023: £500,000) in the issued
ordinary share capital of its wholly owned subsidiary undertaking, Augmentum
Fintech Management Limited (“AFML”), which is registered in England and
Wales, operates in the United Kingdom and is regulated by the Financial
Conduct Authority. AFML’s principal activity is the provision of portfolio
management services to the Company. AFML’s registered office is 4 Chiswell
Street, London EC1Y 4UP.
10 Other Receivables
As at 31 March 2024 2024 2023 2023
Group Company Group Company
£’000 £’000 £’000 £’000
Other receivables 245 196 555 118
11 Other Payables
As at 31 March 2024 2024 2023 2023
Group Company Group Company
£’000 £’000 £’000 £’000
Other payables 699 369 948 810
699 369 948 810
12 Provisions
As at 31 March 2024 2023
Company Company
£’000 £’000
Performance fee provision* 18,980 16,819
* See page 25 and notes 4 and 19.9 for further details.
13 Financial Instruments
(i) Management of Risk
As an investment trust, the Group’s investment objective is to seek capital
growth from a portfolio of securities. The holding of these financial
instruments to meet this objective results in certain risks.
The Group’s financial instruments comprise securities in unlisted companies,
partnership interests, trade receivables, trade payables, and cash and cash
equivalents.
The main risks arising from the Group’s financial instruments are
fluctuations in market price, and credit and liquidity risk. The policies for
managing each of these risks are summarised below. These policies have
remained constant throughout the year under review. The financial risks of the
Company are aligned to the Group’s financial risks.
Market Price Risk
Market price risk arises mainly from uncertainty about future prices of
financial instruments in the Group’s portfolio. It represents the potential
loss the Group might suffer through holding market positions in the face of
price movements, mitigated by stock diversification.
The Group is exposed to the risk of the change in value of its unlisted equity
and non-equity investments. For unlisted equity and non-equity investments the
market risk is principally deemed to be the assumptions used in the valuation
methodology as set out in the accounting policies.
Liquidity Risk
The Group’s assets comprise unlisted equity and non-equity investments.
Whilst unlisted equity is illiquid, short-term flexibility is achieved through
cash and cash equivalents.
Credit Risk
The Group’s exposure to credit risk principally arises from cash and cash
equivalents. Only highly rated banks or liquidity funds (with credit ratings
above A3, based on S&P’s ratings or the equivalent from another ratings
agency) are used for cash deposits and the level of cash is reviewed on a
regular basis. The components of cash and cash equivalents are shown in the
table below.
(ii) Financial Assets and Liabilities
Group Company Group Company
Fair value Fair value Fair value Fair value
2024 2024 2023 2023
£’000 £’000 £’000 £’000
Financial Assets
Unlisted equity shares 259,015 259,015 249,529 249,529
Unlisted convertible loan notes 6,068 6,068 4,766 4,766
Cash at bank 2,460 1,052 14,715 13,470
Cash Equivalents – Liquidity Funds 36,045 35,000 25,300 25,000
Other assets 683 196 1,143 118
Financial Liabilities
Other payables and lease liabilities (1,173) (369) (1,626) (810)
Cash and other receivables and payables are measured at amortised cost and the
rest of the financial assets in the table above are held at approximate to
fair value. The carrying values of the financial assets and liabilities
measured at amortised cost are equal to the fair value.
The unlisted financial assets held at fair value are valued in accordance with
the IPEV Guidelines as detailed within note 19.4.
(iii) Fair Value Hierarchy
Fair value is the amount for which an asset could be exchanged, or a liability
settled, between knowledgeable willing parties in an arm’s length
transaction.
The Group complies with IFRS 13 in respect of disclosures about the degree of
reliability of fair value measurements. This requires the Group to classify,
for disclosure purposes, fair value measurements using a fair value hierarchy
that reflects the significance of the inputs used in making the measurements.
The levels of fair value measurement bases are defined as follows:
Level 1: fair values measured using quoted prices (unadjusted) in active
markets for identical assets or liabilities.
Level 2: fair values measured using valuation techniques for all inputs
significant to the measurement other than quoted prices included within Level
1 that are observable for the asset or liability, either directly (i.e. as
prices) or indirectly (i.e. derived from prices).
Level 3: fair values measured using valuation techniques for which any
significant input to the valuation is not based on observable market data
(unobservable inputs).
All investments were classified as Level 3 investments as at, and throughout
the year to, 31 March 2024. Note 8 on page 61 presents the movements on
investments measured at fair value. Total gains and losses on assets measured
at Level 3 are recognised as part of Gains on Investments in the Consolidated
Income Statement, and no other comprehensive income has been recognised on
these assets.
When using the price of a recent transaction in the valuations, the Company
looks to ‘re-calibrate’ this price at each valuation point by reviewing
progress within the investment, comparing against the initial investment
thesis, assessing if there are any significant events or milestones that would
indicate the value of the investment has changed and considering whether a
market-based methodology (ie. using multiples from comparable public
companies) or a discounted cashflow forecast would be more appropriate.
The main inputs into the calibration exercise, and for the valuation models
using multiples, are revenue, EBITDA, AuM, and P/E multiples (based on the
most recent revenue, EBITDA, AuM, or earnings achieved and equivalent
corresponding revenue, EBITDA, AuM, or earnings multiples of comparable public
companies), quality of earnings assessments and comparability difference
adjustments. Revenue multiples are often used, rather than EBITDA or earnings,
due to the nature of the Group’s investments, being in fast-growing, small
financial services companies which are not normally expected to achieve
profitability or scale for a number of years. Where an investment has achieved
scale and profitability the Group would normally then expect to switch to
using an EBITDA or earnings multiple methodology.
The main input into the PWERM (‘Probability Weighed Expected Return
Methodology’) is the probability of conversion. This method is used for the
convertible loan notes held by the Company.
The fair valuation of private company investments is influenced by the
estimates, assumptions and judgements made in the fair valuation process (see
Note 19.12 on page 68). A sensitivity analysis is provided below which
recognises that the valuation methodologies employed involve subjectivity in
their significant unobservable inputs and illustrates the sensitivity of the
valuations to these inputs. The inputs have been flexed with the exception of
the Sales Price valuation approach as it does not involve significant
subjectivity. The table also provides the range of values for the key
unobservable inputs.
As at 31 March 2024
Valuation Fair value of Key Other Applied Weighted Sensitivity Change in
approach investments unobservable Unobservable Multiple average +/- Valuation
£’000 inputs inputs Range multiple % +/-
applied# £’000
Market approach using comparable traded multiples 217,054 Revenue Multiple ‡ a, b, c, g 2.3x – 28.0x 6.0x 10% 17,564 / (17,554)
Earnings Multiple a, b, c, g 6.3x-18.6x 11.0x 10% 3,146 / (2,423)
AUM Multiple a, b, c, g 0.1x 0.1x 10% 264 / -
Illiquidity discount d, g 0% - 50% 32.3% 30% 12,558 / (10,920)
Transaction implied premiums and discounts e, g 0% - 630% 109.3% 30% 17,063 / (18,023)
Net Asset Value** 8,264 Discount to NAV a n/a n/a 10% (826)
PWERM* 6,068 Probability of conversion a n/a n/a 25% 248/(248)
Expected transaction price 7,135 Execution risk discount a, f n/a n/a 10% 713 / (713)
CPORT^ 16,414 Transaction Price a, e, g n/a n/a 10% 1,641 / (1,641)
Sales Price 10,148 n/a n/a n/a n/a n/a n/a
# Weighted average is calculated by reference to the fair value of holdings as
at the respective year-end. This therefore gives a clearer indication of the
typical multiple or adjustment being applied across the portfolio.
**LP (‘Limited Partnership’) investments are held at net asset values
provided by the relevant LP fund administrators. These are adjusted by
benchmark movements as appropriate.
^ Whilst a recent or expected transaction price may be the most appropriate
basis for a valuation, it will be corroborated by other techniques which
factor in the unobservable inputs noted below.
As at 31 March 2023
Valuation Fair value of Key Other Applied Weighted Sensitivity Change in
approach investments unobservable Unobservable Multiple average +/- Valuation
£’000 inputs inputs Range multiple % +/-
applied# £’000
Market approach using comparable traded multiples 197,876 Revenue Multiple ‡ a, b, c, g 2.7x – 11.1x 4.8x 10% 17,563 / (17,563)
Earnings Multiple a, b, c, g 8.3x-11.8x 10.9x 10% 3,146 / (2,423)
AUM Multiple a, b, c, g 0.1x 0.1x 10% 264 / -
Illiquidity discount d, g 0% - 44% 19.3% 30% 4,117 / (4,044)
Transaction implied premiums and discounts e, g 0% - 310% 105.0% 30% 17,824 / (17,300))
Net Asset Value ** 5,805 Discount to NAV a n/a n/a 10% (581)
PWERM* 4,766 Probability of conversion a n/a n/a 25% 248/(248)
Expected transaction price 14,216 Execution risk discount a, f n/a n/a 10% 142 / (142)
CPORT^ 8,842 Transaction Price a, e, g n/a n/a 10% 884 / (884)
Sales Price 22,790 n/a n/a n/a n/a n/a n/a
The variable inputs applicable to each broad category of valuation basis will
vary dependent on the particular circumstances of each private company
valuation. An explanation of each of the key variable inputs is provided
below. The assumptions and decisions process in relation to the inputs is
described in note 19.12 on page 68.
(a) Application of valuation basis
Each investment is assessed independently, and the valuation basis applied
will vary depending on the circumstances of each investment. When an
investment is pre-revenue, the focus of the valuation will be on assessing the
recent transaction and the achievement of key milestones since investment.
Adjustments may also be made depending on the performance of comparable
benchmarks and companies. For those investments where a trading multiples
approach can be taken, the methodology will factor in revenue, earnings or
assets under management as appropriate for the investment.
(b) Selection of comparable companies
The selection of comparable companies is assessed individually for each
investment and the relevance of the comparable companies is continually
evaluated at each valuation date. Key criteria used in selecting appropriate
comparable companies are the industry sector in which they operate, the
geography of the company’s operations, the respective revenue and earnings
growth rates, operating margins, company size and development stage.
Typically, between 4 and 10 comparable companies will be selected for each
investment, but this can vary depending on how many relevant comparable
companies are identified. The resultant revenue or earnings multiples or share
price movements derived will vary depending on the companies selected and the
industries they operate in. Given the nature of the investments the Company
makes there are not always directly comparable listed companies, in such cases
comparables will be selected whose businesses bear similarity to the relevant
investment, in such cases the need for an additional discount / premium to the
comparables will be assessed at each valuation date.
(c) Estimated sustainable revenue or earnings
The selection of sustainable revenue or earnings will depend on whether the
company is sustainably profitable or not, and where it is not then revenues
will be used in the valuation. The valuation approach will typically assess
companies based on the last twelve months of revenue or earnings, as they are
the most recent available and therefore viewed as the most reliable. Where a
business has volatile earnings on a year-on-year basis, revenue or earnings
may be assessed over a longer period. Where a company has reliably forecasted
earnings previously or there is a change in circumstance at the business which
will impact earnings going forward, then forward estimated revenue or earnings
may be used instead.
(d) Application of illiquidity discount
An illiquidity discount may be applied either through the calibration of a
valuation against the most recent transaction, or by application of a specific
discount. The discount applied where a calibration (see (e) below) is not
appropriate is dependent on factors specific to each investment, such as
quality of earnings or revenues and potential exit scenarios.
(e) Transaction implied premium and discount
Where there is an implied company valuation available as a result of an
external arm's length transaction, the ongoing valuation will be calibrated to
this by deriving a company valuation with reference to the average multiple
from a set of comparable companies and comparing this to a transaction implied
valuation. This can result in an implied premium or discount compared to
comparable companies at the point of transaction. This discount or premium
will be considered in future valuations and may be reduced due to factors such
as the time since the transaction and company performance. Where a calibrated
approach is not appropriate, a discount for illiquidity may be applied as
noted in (d) above.
(f) Execution risk
An execution risk discount is applied to all investments where an
arm’s-length transaction is due to take place but hasn’t closed prior to
the reporting period end. The discount applied is dependent on the progress of
the negotiations and outstanding matters that may impact on the expected
price. When valuing in line with an expected transaction the arm’s-length
nature of the deal will be assessed, and term sheets will have been received.
(g) Liquidity preference
The company’s investments are typically venture investments with downside
protections such as liquidation preference and anti-dilution provisions.
Unlike ordinary share structures typically seen in the public or private
markets, these structures protect the value of the Company’s position in the
event of a reduction in the enterprise value of an investee company from the
price paid. Where a valuation indicates the enterprise value of an investment
has fallen the enterprise value will be fed into the investee companies’
‘waterfall’ (which ranks shares by seniority/preference in the event of a
liquidation event) to calculate the value of the Company’s position.
14 Substantial holdings in Investments
The table below shows substantial holdings in investments where the Company
owns more than 3% of the fully diluted capital of the investee company and the
investment value is more than 5% of the Company’s non-current investments.
2024 2023
% ownership % of % ownership % of
(fully diluted) portfolio (fully diluted) portfolio f
Zopa Bank* 3.5 14.8 3.4 11.8
Augmentum I LP** 100 20.7 100 17.5
Tide 5.6 19.3 5.1 14.0
Grover 6.3 13.5 6.3 17.0
Cushon – – 13.9 9.0
Volt 8.3 9.6 8.3 5.6
* indirect ownership via Augmentum I LP.
** Augmentum I LP’s registered office is IFC 5, St Helier, Jersey JE1 1ST
and it is registered in Jersey.
15 Called up Share Capital
2024 2023
Ordinary Shares Ordinary Shares
No. £’000 No. £’000
Opening issued and fully paid ordinary shares of 1p each 174,518,852 1,810 180,325,786 1,810
Ordinary shares purchased into treasury (4,687,567) – (5,806,934) –
Closing issued and fully paid ordinary shares of 1p each 169,831,285 1,810 174,518,852 1,810
No shares were issued during the years ended 31 March 2023 and 31 March 2024.
4,687,567 shares were bought back into treasury during the year at an average
price, including ancillary costs, of 98.3p per share. In the year ended 31
March 2023 5,806,934 shares were bought back into treasury at an average price
of 102.9p per share.
At 31 March 2024 there were 11,182,412 shares held in treasury (2023:
6,494,845).
16 Net Asset Value per Share
The net asset value per share is based on the Group net assets attributable to
the equity shareholders of £303,317,000 (2023: £294,124,000) and 169,831,285
(2023: 174,518,852) shares in issue at the year end excluding shares held in
treasury.
The net asset value per share after performance fee* is based on the Group net
assets attributable to the equity shareholders of £303,317,000 (2023:
£294,124,000), less the performance fee provision made by the Company of
£18,980,000 (2023: £16,819,000), and 169,831,285 (2023: 174,518,852) shares
in issue at the year end excluding shares held in treasury.
* Alternative Performance Measure
17 Related Party Transactions
Balances and transactions between the Company and its subsidiaries are
eliminated on consolidation. Details of transactions between the Group and
Company and other related parties are disclosed below.
The following are considered to be related parties:
• Frostrow Capital LLP (under the Listing Rules only)
• The Directors of the Company and the Company’s subsidiary, Augmentum
Fintech Management Limited
• Augmentum Fintech Management Limited
Details of the relationship between the Company and Frostrow Capital LLP, the
Company’s AIFM, are disclosed on page 24. Details of fees paid to Frostrow
by the Company and Group can be found in note 2 on page 58.
Details of the remuneration of all Directors can be found on page 45. Details
of the Directors’ interests in the capital of the Company can be found on
page 46.
Augmentum Fintech Management Limited is appointed as the Company’s delegated
Portfolio Manager. The Portfolio Manager earns a portfolio management fee of
1.5% of NAV up to £250 million and 1.0% of NAV for any excess over £250
million and is entitled to a performance fee of 15% of net realised cash
profits once the Company has received an annual compounded 10% realised return
on its investments. Further details of this arrangement are set out on page 25
in the Strategic Report. During the year the Portfolio Manager received a
portfolio management fee of £3,972,000 (2023: £4,026,000), which has been
eliminated on consolidation and therefore does not appear in these accounts. A
performance fee provision of £18,980,000 (2023: £16,819,000) has been
accrued in the Company's accounts, which is eliminated on consolidation in the
Group accounts. No performance fee is payable or has been paid during the
year. There were no outstanding balances due to the Portfolio Manager at the
year end (2023: nil).
18 Capital Risk Management
Group Group
2024 2023
£’000 £’000
Equity
Equity share capital 1,810 1,810
Retained earnings and other reserves 301,507 292,314
Total capital and reserves 303,317 294,124
The Group’s objective in the management of capital risk is to safeguard its
liquidity in order to provide returns for shareholders and to maintain an
optimal capital structure. In doing so the Group may adjust the amount of
dividends paid to shareholders or issue new shares or debt.
The Group manages the levels of cash deposits held whilst maintaining
sufficient liquidity for investments and operating expenses.
There are no externally imposed restrictions on the Company’s capital.
19 Basis of Accounting and Significant Accounting Policies
19.1 Basis of preparation
The Group and Company Financial Statements for the year ended 31 March 2024
have been prepared in accordance with UK-adopted International Accounting
Standards and with the requirements of the Companies Act 2006 as applicable to
companies reporting under those standards.
The Financial Statements have been prepared on a going concern basis and under
the historical cost basis of accounting, modified to include the revaluation
of certain assets at fair value, as disclosed in note 19.4. The Board has
considered a detailed assessment of the Group and Company’s ability to meet
their liabilities as they fall due, including stress tests which modelled the
effects of a fall in portfolio valuations and liquidity constraints on the
Group and Company’s financial position and cash flows. The results of the
tests showed that the Group and Company would have sufficient cash to meet
their liabilities as they fall due. Based on the information available to the
Directors at the time of this report, including the results of the stress
tests, and the Group and Company’s cash balances, the Directors are
satisfied that the Group and Company have adequate financial resources to
continue in operation for at least the next 12 months from the date of signing
of these financial statements and that, accordingly, it is appropriate to
adopt the going concern basis in preparing these financial statements.
In order to reflect the activities of an investment trust company,
supplementary information which analyses the Consolidated Income Statement
between items of a revenue and capital nature has been presented alongside the
Consolidated Income Statement. In analysing total income between capital and
revenue returns, the Directors have followed the guidance contained in the
Statement of Recommended Practice for investment companies issued by the
Association of Investment Companies issued in July 2022 (the “SORP”).
The recommendations of the SORP which have been followed include:
• Realised and unrealised profits or losses arising on the revaluation or
disposal of investments classified as held at fair value through profit orloss
should be shown in the capital column of the Consolidated Income Statement.
Realised gains are taken to the realised reserves in equity and unrealised
gains are transferred to the unrealised reserves in equity.
• Other returns on any investment (whether in respect of dividends,
interest or otherwise) should be shown in the revenue column of the
Consolidated Income Statement. The total of the revenue column of the
Consolidated Income Statement is taken to the revenue reserve in equity.
• The Board should determine whether the indirect costs of generating
capital returns should be allocated to capital as well as the direct costs
incurred in generating capital profits. In this regard the Board has decided
to follow a non-allocation approach to indirect costs, which will therefore be
charged in full to the revenue column of the Consolidated Income Statement.
19.2 Basis of Consolidation
The Consolidated Financial Statements include the Company and certain
subsidiary undertakings.
IFRS 10 and IFRS 12 define an investment entity and include an exemption from
the consolidation requirements for investment entities.
The Company has been deemed to meet the definition of an investment entity per
IFRS 10 as the following conditions exist:
• The Company has multiple unrelated investors which are not related
parties, and holds multiple investments
• Ownership interests in the Company are exposed to variable returns from
changes in the fair value of the Company’s net assets
• The Company has obtained funds for the purpose of providing investors
with investment management services
• The Company’s business purpose is investing solely for returns from
capital appreciation and investment income
• The performance of investments is measured and evaluated on a fair value
basis.
The Company will not consolidate the portfolio companies or other investment
entities it controls. The principal subsidiary Augmentum Fintech Management
Limited as set out in note 9 is wholly owned. It provides investment related
services through the provision of investment management. As the primary
purpose of this subsidiary is to provide investment related services that
relate to the Company’s investment activities it is not held for investment
purposes. This subsidiary has been consolidated.
The Company also owns 100% of the interests in Augmentum I LP (the ‘LP’).
As this LP is itself an investment entity and is held as part of the
Company’s investment portfolio it has not been consolidated.
19.3 Application of New Standards
(i) New standards, interpretations and amendments effective from 1 April
2023
There were no new standards or interpretations effective for the first time
for periods beginning on or after 1 April 2023 that had a significant effect
on the Group’s financial statements.
(ii) New standards, interpretations and amendments not yet effective
There are a number of standards and interpretations which have been issued by
the International Accounting Standards Board (‘IASB’) that are effective
in future accounting periods. The Group does not expect any of the standards
issued by the IASB, but not yet effective, to have a material impact on the
Group or Company.
19.4 Investments
All investments are defined by IFRS as fair value through profit or loss
(described in the Financial Statements as Investments held at fair value) and
are subsequently measured at reporting dates at fair value. The fair value of
direct unquoted investments is calculated in accordance with the Principles of
Valuation of Investments below. Purchases and sales of unlisted investments
are recognised when the contract for acquisition or sale becomes
unconditional.
Increases or decreases in valuation are recognised as part of gains on
investments at fair value in the Consolidated Income Statement.
Principles of Valuation of Investments
(i) General
The Group estimates the fair value of each investment at the reporting date in
accordance with IFRS 13 and the International Private Equity and Venture
Capital Valuation (“IPEV”) Guidelines.
Fair value is the price for which an asset could be exchanged between
knowledgeable, willing parties in an arm’s length transaction. In estimating
fair value, the AIFM and Board apply valuation techniques which are
appropriate in light of the nature, facts and circumstances of the investment
and use reasonable current market data and inputs combined with judgement and
assumptions. Valuation techniques are applied consistently from one reporting
date to another except where a change in technique results in a better
estimate of fair value.
In general, the enterprise value of the investee company in question will be
determined using one of a range of valuation techniques. The enterprise value
is adjusted for factors such as surplus assets, excess liabilities or other
contingencies or relevant factors; the resulting amount is apportioned between
the investee company’s relevant financial instruments according to their
ranking and the effect of any instrument that may dilute economic
entitlements.
(ii) Unlisted Equity Investments
In respect of each unlisted investment one or more of the following valuation
techniques is used:
• A market approach, based on the price of the recent investment, market
multiples or industry valuation benchmarks.
• A probability-weighted expected returns methodology. Under the PWERM fair
value is based on consideration of values for the investment under different
scenarios. This will primarily be used where there is a convertible element to
the investment.
• A net assets based approach based on the value of the underlying assets
of the investment.
In assessing whether a methodology is appropriate techniques that use
observable market data are preferred.
Price of Recent Investment/Transaction
Where the investment being valued was itself made recently, or there has been
a third party transaction in the investment, the price of the transaction may
provide a good indication of fair value. Using the Price of Recent Investment
technique is not a default and at each reporting date the fair value of
investments is estimated to assess whether changes or events subsequent to the
relevant transaction would imply a material change in the investment’s fair
value.
Multiple
Under the multiple methodology a revenue, EBITDA, AuM or earnings multiple
technique is used. This involves the application of an appropriate and
reasonable multiple to the maintainable earnings or revenue of an investee
company.
Further details on the multiple based methodology are provided in note 13
(iii).
PWERM (‘Probability-Weighted Expected Returns Methodology’)
Under the PWERM potential scenarios are identified. Under each scenario the
value of the investment is estimated and a probability for each scenario is
selected. The fair value is then calculated as the sum of the value under each
scenario multiplied by its probability.
Net Assets
For the net asset approach the fair value estimate is based on the
attributable proportion of the reported net asset value of the investment
derived from the fair value of underlying assets / investments. Valuation
reports provided by the manager or general partner of the investments are used
to calculate fair value where there is evidence that the valuation is derived
using fair value principles that are consistent with the Company’s
accounting policies and valuation methods. Such valuation reports may be
adjusted to take account of changes or events to the reporting date, or other
facts and circumstances which might impact the underlying value.
19.5 Cash and Cash Equivalents
Cash comprises cash at bank and short-term deposits with an original maturity
of less than 3 months and subject to minimal risk of changes in value.
19.6 Presentation and Functional Currency
The Group’s and Company’s presentation and functional currency is Pounds
Sterling (“Sterling”), since that is the currency of the primary economic
environment in which the Group operates.
19.7 Other income
Interest income received from cash equivalents is accounted for on an accruals
basis.
19.8 Expenses
Expenses are accounted for on an accruals basis, and are charged through the
revenue column of the Consolidated Income Statement except for transaction
costs and the performance fee as noted below.
Transaction costs are legal and professional fees incurred when undertaking
due diligence on investment transactions. Transaction costs, when incurred,
are recognised in the Income Statement. If a transaction successfully
completes, as a direct cost of an investment, the related transaction cost is
charged to the capital column of the Income Statement. If the transaction does
not complete the related cost is charged to the revenue column of the Income
Statement.
19.9 Performance Fee
As set out in prior annual reports the performance fee arrangements were set
up to provide a long-term employee benefit plan to incentivise employees of
AFML and align them with shareholders through participation in the realised
investment profits of the Group. AFML is entitled to a performance fee, and
any performance fee paid by the Company to AFML is allocated to employees of
AFML on a discretionary basis by the Management Engagement & Remuneration
Committee of the Company. Non-executive Directors of the Company are not
eligible to participate in any allocation of the performance fee.
The Company provides for the performance fee in full. A performance fee is
provided for if its performance conditions would be achieved if the remaining
assets in that basket were realised at fair value, at the Statement of
Financial Position date. The performance fee is equal to the share of profits
in excess of the performance conditions in the basket. On consolidation the
performance fee is eliminated since it is payable to the Company’s
subsidiary, AFML.
Performance fees are charged to the capital column of the Income Statement and
taken to the Capital Reserve.
19.10 Share Premium and Special Reserve
The share premium account arose following the Company’s admission to listing
in 2018 and represented the difference between the proceeds raised and the par
value of the shares issued. Costs of the share issuance were offset against
the proceeds of the relevant share issue and also taken to the share premium
account.
Subsequent to admission and following the approval of the Court, the initial
share premium account was cancelled and the balance of the account was
transferred to the Special Reserve. The purpose of this was to enable the
Company to increase the distributable reserves available to facilitate the
payment of future dividends or with which to make share repurchases.
19.11 Revenue and Capital Reserves
Net capital return is added to the Capital Reserve in the Consolidated
Statement of Financial Position, while the net revenue return is added to the
Revenue Reserve. When positive, the revenue reserve is distributable by way of
dividend, as is any realised portion of the capital reserve. The realised
portion of the capital reserve is £52,491,000 (2023: £40,519,000)
representing realised capital profits less costs charged to capital.
19.12 Critical Accounting Judgements and Key Sources of Estimation
Uncertainty
Critical accounting judgements and key sources of estimation uncertainty used
in preparing the financial information are continually evaluated and are based
on historical experience and other factors, including expectations of future
events that are believed to be reasonable. The resulting judgements and
estimates will, by definition, seldom equal the related actual results.
Key sources of estimation uncertainty
The key assumptions concerning the future, and other key sources of estimation
uncertainty in the reporting year, that may have a significant risk of causing
a material adjustment to the carrying amounts of assets and liabilities within
the next financial year, are discussed below.
Fair value measurements and valuation processes
Unquoted assets are measured at fair value in accordance with IFRS 13 and the
IPEV Valuation Guidelines. Decisions are required in order to determine the
appropriate valuation methodology and subsequently in determining the inputs
into the valuation model used. These decisions include selecting appropriate
quoted company comparables, appropriate multiples to apply, adjustments to
comparable multiples and estimating future cash flows of investee companies.
In estimating the fair value of an asset, market-observable data is used, to
the extent it is available.
The Valuations Committee, which is chaired by a Director, determines the
appropriate valuation techniques and inputs for the model. The Audit Committee
considers the work of the Valuations Committee and the results of their
discussion with the AIFM, Portfolio Manager and the external auditor and works
closely with the AIFM and Portfolio Manager to review the appropriate
valuation techniques and inputs to the model. The Chair of the Audit Committee
reports its findings to the Board of Directors of the Group every six months
to explain the cause of fluctuations in the fair value of the investments.
Information about the valuation techniques and inputs used in determining the
fair value of various assets and liabilities are disclosed in notes 19.4 and
13(iii).
As set out in note 19.9 a performance fee is calculated which is based on the
valuation of the investments and as such is considered a significant
accounting estimate.
20 Post Balance Sheet Events
No post balance sheet events have occurred since 31 March 2024.
21 Financial Commitment
The Company made commitments to invest up to $3,000,000 into the Snowcrash
Offshore Feeder LP. Of this commitment $nil (2023: $750,000) remains
outstanding.
.
2024 Accounts
The figures and financial information for 2024 are extracted from the annual
report and financial statements for the year ended 31 March 2024 and do not
constitute the statutory accounts for the year. The annual report and
financial statements include the Report of the Independent Auditor which is
unqualified and does not contain a statement under either section 498(2) or
section 498(3) of the Companies Act 2006. The annual report and financial
statements have not yet been delivered to the Registrar of Companies.
2023 Accounts
The figures and financial information for 2023 are extracted from the
published annual report and financial statements for the year ended 31 March
2023 and do not constitute the statutory accounts for that year. The annual
report and financial statements have been delivered to the Registrar of
Companies and included the Report of the Independent Auditor which was
unqualified and did not contain a statement under either section 498(2) or
section 498(3) of the Companies Act 2006.
Annual report and financial statements
Copies of the annual report and financial statements will be posted to
shareholders shortly and will be available on the Company’s website
(www.augmentum.vc) or in hard copy format from the Company Secretary.
The Company's annual report for the year ended 31 March 2024 will shortly be
available for inspection on the National Storage Mechanism (NSM) via
https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
The Annual General Meeting will be held on Thursday, 19 September 2024 at
11.00 a.m. The Notice of the Annual General Meeting will be posted to
shareholders with the annual report and will be available on the Company’s
website and the NSM as per the above with respect to the annual report.
Neither the contents 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.
Copyright (c) 2024 PR Newswire Association,LLC. All Rights ReservedRecent news on Augmentum Fintech
See all newsREG-Augmentum Fintech plc: Factsheet as at 31 March 2025
AnnouncementREG-Augmentum Fintech plc: Total Voting Rights
AnnouncementREG-Augmentum Fintech plc: Transaction in Own Shares
AnnouncementREG-Augmentum Fintech plc: Transaction in Own Shares
AnnouncementREG-Augmentum Fintech plc: Transaction in Own Shares
Announcement