REG - Baronsmead Second VT - Half-year Report
11/06/2025 07:00
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RNS Number : 2888M Baronsmead Second Venture Trust PLC 11 June 2025
Baronsmead Second Venture Trust plc
Half-yearly report for the six months ended 31 March 2025
The Directors of Baronsmead Second Venture Trust plc are pleased to announce
the unaudited half-yearly financial report for the six months to 31 March
2025. Copies of the half-yearly report can be obtained from the following
website: www.baronsmeadvcts.co.uk (http://www.baronsmeadvcts.co.uk/) .
Our investment objective
Baronsmead Second Venture Trust plc (the "Company") is a tax efficient listed
company which aims to achieve long-term positive investment returns for
private investors, including tax free dividends.
Investment policy(1)
· To invest primarily in a diverse portfolio of UK growth
businesses, whether unquoted or traded on the Alternative Investment Market
("AIM").
· Investments are made selectively across a range of sectors in
companies that have the potential to grow and enhance their value.
Dividend policy(2)
· The Board will, where possible, seek to pay two dividends to
shareholders in each financial year, typically an interim dividend in
September and a final dividend following the Annual General Meeting in
February/March.
· The Board will use, as a guide, when setting the dividends for a
financial year, a sum representing 7 per cent of the opening net asset value
of that financial year.
1. This is a summary of the Company's investment policy that is set out on
page 2 of the Company's Annual Report and Financial Statements for the year
ended 30 September 2024.
2. This is a summary of the Company's dividend policy that is set out on page
2 of the Company's Annual Report and Financial Statements for the year ended
30 September 2024.
Key elements of the business model
Access to an attractive, diverse portfolio
The Company gives shareholders access to a diverse portfolio of growth
businesses.
The Company will make investments in growth businesses, whether unquoted or
traded on AIM, which are substantially based in the UK in accordance with the
prevailing VCT legislation. Investments are made selectively across a range of
sectors.
The Manager's approach to investing
The Manager endeavours to select the best opportunities and applies a
distinctive selection criteria based on:
· Primarily investing in parts of the economy which are
experiencing long-term structural growth.
· Businesses that demonstrate, or have the potential for, market
leadership in their niche.
· Management teams that can develop and deliver profitable and
sustainable growth.
· Companies with the potential to become an attractive asset
appealing to a range of buyers at the appropriate time to sell.
In order to ensure a strong pipeline of opportunities, the Manager invests in
building deep sector knowledge and networks and undertakes significant
proactive marketing to interesting target companies in preferred sectors. This
approach generates a network of potentially suitable businesses with which the
Manager maintains a relationship ahead of possible investment opportunities.
The Manager as an influential shareholder
The Manager is an engaged and supportive shareholder (on behalf of the
Company) in both unquoted and significant quoted investments.
For unquoted investments, representatives of the Manager often join the
investee board.
The role of the Manager with investees is to ensure that strategy is clear,
the business plan can be implemented and that management resources are in
place to deliver profitable growth. The intention is to build on the business
model and grow the company into an attractive target which can be sold or
potentially floated in the medium term.
A more detailed explanation of how the business model is applied is provided
in the Other Matters section of the Strategic Report on pages 30 to 33 in the
Company's Annual Report and Financial Statements for the year ended 30
September 2024.
Financial highlights
314.3p Net Asset Value total return(1) (as at 31 March 2025)
Net Asset Value ("NAV") total return to shareholders for every 100.0p invested
at launch (January 2001).
March 2024 - 329.7.8p
September 2024 - 337.7p
March 2025 - 314.3p
£13.8mn Funds raised (six months to 31 March 2025)
£13.8mn raised in the period (before costs); and a further £1.2mn raised
(before costs) since the period end.
March 2024 - £8.2mn (six months to March)
September 2024 - £8.2mn (six months to March); £25.0mn (twelve months to
September)
March 2025* - £13.8mn (six months to 31 March)
*includes amounts allotted on 3 April 2025.
-7.1% Change in net asset value per share(1,2) (six months to 31 March 2025)
NAV per share decreased 7.1 per cent to 51.3p, before the deduction of
dividends, in the six months to 31 March 2025.
March 2024 - 57.7p
September 2024 - 55.2p
March 2025* - 51.3p
*Excludes interim dividend of 1.75p
£3.8mn New investments(3) (six months to 31 March 2025)
Investments made into two new and nine follow-on opportunities during the
period. (Unquoted: £2.9mn, Quoted: £0.9mn).
March 2024 - £7.3mn (six months to March)
September 2024 - £7.3mn (six months to March); £13.4mn (twelve months to
September)
March 2025 - £3.8mn (six months to March)
1. Alternative Performance Measures ("APM")/Key Performance Indicators
("KPIs") - please refer to glossary on page 29 of the full Half-yearly Report
for definitions.
2. Please refer to table on page 6 of the full Half-yearly Report for
breakdown of NAV per share movement.
3. Direct investments only - please refer to glossary on page 29 of the full
Half-yearly Report for definitions.
Chair's statement
The election of President Trump in November 2024 heralded a period of domestic
and global political uncertainty which has continued to weigh on market
sentiment during the 6 months to 31 March 2025. As a result of these ongoing
macroeconomic challenges, the Company's net asset value (NAV) decreased by
3.9p per share to 51.3p despite some value uplifts from many investments. As
described more fully below, the equity price declines in the Company's listed
portfolio outweighed the resilience in the performance of the Company's
unquoted investments. Once again though, this highlights the benefits of the
Company's investment policy of having a combination of unquoted and listed
assets. Performance in recent periods shows how this diversification across
private and public equity markets supports the Company's aim of providing a
more consistent total return to shareholders over the medium to long term.
After the period end, the NAV has increased to 54.1p per share by the 31 May
2025 through a recovery of value within the listed portfolio despite the
increased level of volatility evidenced in April, as reported on below.
Consumer and business confidence has remained fragile since the end of the
period with further macroeconomic and geopolitical headwinds driving market
volatility. However, your Board continues to believe that, in aggregate, the
fundamentals of the underlying portfolio companies remain robust. Having said
that, it is in the nature of VCT qualifying investments that some portfolio
companies will continue to require more capital to scale and generate value.
Results
During the six months to 31 March 2025, the Company's NAV per share decreased
7.1 per cent from 55.2p to 51.3p after the payment of the final dividend of
2.25p per share on 17 March 2025. The table below breaks down the movement
in NAV over the 6 months.
Pence per ordinary share
NAV as at 1 October 2024
(after deducting the final dividend of 2.25p, paid on 17 March 2025) 55.2
Valuation decrease (7.1 per cent.) (3.9)
NAV as at 31 March 2025 51.3
Dividends
The Board has declared an interim dividend of 1.75p per share to be paid on 8
September 2025 to shareholders on the register as of 8 August 2025. The
Board is aware that dividends are an important part of the total return to the
shareholders' investment in the Company. As such, the Board is aiming to
achieve its dividend policy objective of an annual yield of 7.0 per cent based
on the NAV at the beginning of the financial year. I must of course remind
shareholders this is not a guarantee and that payment dates and the amount of
future dividends depend on the level and timing of profitable realisations.
Portfolio review
The table below provides a summary of each asset class and the return
generated during the period under review.
Asset class NAV (£mn) % of NAV* Number of investee companies % return in the period(‡)
Unquoted 57 28 47 (0)
AIM- traded companies 77 38 38 (12)
WS Gresham House Equity Funds(†) 54 26 75 (7)
Liquid assets(#) 17 8 N/A 3
Total 205 100 160 (7)
* By value at 31 March 2025.
(‡) Return includes interest received on unquoted realisations during the
period.
(†) Excludes investee companies with holdings by more than one fund.
(#) Represents cash, OEICs and net current assets. % return in the period
relates only to the cash liquidity funds.
The value of the unquoted portfolio remained flat for the six months to 31
March 2025. 35 per cent of the portfolio registered an increase in value
during the period, 35 per cent remained flat and 30 per cent registered
reductions in value. The main drivers of positive movements in value were the
investments in CitySwift and Panthera Biopartners, with both showing good
trading momentum and increases in revenue during the period. The main
detractors from performance were the investments in Orri, despite further
funding, and Huma Therapeutics, with both facing difficult trading conditions
and reduced revenues. The impact of both consumer and business confidence has
continued to be seen in a reticence in decision making leading to extending
sales cycles. This has been particularly evident in sectors where Government
spending plays a significant part, such as health and defence. The Manager
continues to focus on improving and sustaining unquoted performance.
Disappointingly, the value of the Company's portfolio of investments directly
held in AIM-traded companies decreased 11.6 per cent in the six months to 31
March 2025. For reference, the AIM market in the UK decreased 7.1 per cent for
the same period. The value of the Company's investments into the WS Gresham
House UK Micro Cap Fund decreased by 3.5 per cent and the WS Gresham House UK
Smaller Companies Fund decreased by 7.5 per cent compared to the IA UK Smaller
Companies sector which decreased by 9.1 per cent. The WS Gresham House UK
Multi Cap Income Fund decreased by 11.5 per cent in the period compared to the
IA UK Equity Income sector that decreased by 0.1 per cent. These were as a
result of a number of factors affecting UK smaller companies including the
national insurance and minimum wage increases and despite over 80 per cent of
the trading update announcements made by companies within the WS Gresham House
Equity Funds portfolios being in line or ahead of expectations.
Following the end of the period under review, the Board was pleased to see
that the Company's portfolio of AIM traded companies rebounded and increased
by 4.8 per cent in the month to 30 April 2025 compared to the AIM market which
increased by 1.5 per cent. This was subsequently followed up with a further
increase of 5.3 per cent in the month to 31 May 2025.
Investments
I am pleased to report that the Company made two new unquoted investments
totalling £1.5mn and nine follow-on investments with a combined value of
£2.3mn in the six months to 31 March 2025.
· Mobility Mojo (unquoted) - a disability access assessment
platform
· Much Better Adventures (unquoted) - a marketplace offering
exclusive guided and bespoke global travel experiences
Following the period end, a total of £3.2mn was invested into three new
unquoted companies, Penfold Technology, Nu Quantum, and Spinners; and a
follow-on investment into one unquoted company, Airfinity.
Realisations
In the listed portfolio, the Manager continued to take profits from partial
sales of the Company's holdings of Cerillion and SEEEN resulting in proceeds
of £0.1mn and £0.2mn respectively, and gross money multiples of 25.7x and
0.2x of original cost. There were also partial realisations of MXC Capital,
following a tender offer, and Crossword Cybersecurity following it entering
administration during the period.
There were no realisations in the unquoted portfolio during the period.
Fundraising
In the 2024/25 tax year, the Company successfully raised £13.8mn (before
costs) through an offer for subscription. The Board decided to extend the
offer into the 2025/26 tax year in April 2025 with a further £0.6mn being
successfully allotted to date. A fourth and final allotment is expected to
take place on or around 3 July 2025. The Directors want to welcome the 526 new
shareholders who invested for the first time and also thank the 508 existing
shareholders who continue to support the Company.
The Board will consider whether to raise additional funds in the 2025/26 tax
year. This will be determined by the Company's cashflow, the overall balance
of the Company's portfolio, and its anticipated requirements and opportunities
to fund new and follow-on investments over the next two to three years. The
Board appreciates that shareholders would like plenty of notice of its
fundraising intentions and will ensure that shareholders are informed of the
Board's intention to raise new funds, as soon as it becomes practical.
Consumer Duty
The FCA's Consumer Duty came into force on 31 July 2023 and, in summary,
requires firms to which this applies to, to act to deliver good outcomes for
their retail customers. The Consumer Duty regulations apply to the regulated
and ancillary activities of all FCA authorised firms under the Financial
Services and Markets Act 2000, the Payment Services Regulations 2017 and the
Electronic Money Regulations 2011. The Company is not a FCA authorised firm
and accordingly does not fall within scope of these regulations. However, the
Company's Manager, Gresham House Asset Management Ltd, being an FCA authorised
firm, is covered by the regulations and the Board is cognisant of the
Manager's obligations to comply with the Consumer Duty. The Board receives
regular updates from the Manager on the delivery of its obligations under the
Consumer Duty and is satisfied that the Manager is complying with all
appropriate regulation.
Succession planning
As reported in the Annual Report and Accounts, Adriana Stirling joined the
Board on 1 December 2024 replacing Malcolm Groat as the Chair of the Company's
Audit & Risk Committee. Adriana qualified as a chartered accountant with
PricewaterhouseCoopers LLP ("PwC") and developed extensive organisational and
anti-financial crime technical expertise over her 17 years at PwC, leading
client engagements across financial and non-financial service industries,
spanning the public and private sectors. In 2014, she became the Managing
Director of a private family office. She has overall responsibility for the
investment and operational aspects of the office, including managing
significant shareholder positions in several unquoted companies.
Share price discount and buy back policies
The Board intends to continue with the policy of seeking to maintain a share
price discount to NAV of 5 per cent and to buy back shares at that level from
time to time with the objective of maintaining liquidity in the market for its
existing shares. To that end it will also sell shares out of Treasury in
certain circumstances. The day-to-day management of these policies is
undertaken by the Manager on behalf of the Board and is subject to the
prevailing market circumstances and on the basis that the Company has adequate
resources to make new and follow-on investments and pay dividends to
shareholders.
Outlook
The period since 31 March has seen the implementation of many of the policies
brought in by the new Labour government in the Autumn Budget which, together
with the almost daily developments regarding the imposition of trade tariffs
by the US Government, has created much uncertainty and volatility in public
markets and a decline in the US dollar. Whilst the direct impact of the
currently proposed tariffs on the unquoted companies in the portfolio is
minimal, there is likely to be an indirect impact driven by the weakening in
global trade.
There is widespread concern about the prospect of the US, UK and some European
economies moving into recession. Furthermore, consumer and business confidence
both domestically and globally may have been materially damaged and could take
a significant amount of time to repair. The Board expects that this elevated
macroeconomic and geopolitical risk landscape will continue to impact our
investments beyond the risks that would normally be associated with investing
in smaller companies. Added to this, the exit environment remains subdued in
comparison to recent years.
However, the Company's portfolio remains highly diversified and the hybrid
nature of our investment portfolio helps to mitigate those uncertainties. In
addition, it is largely positioned in sectors which the Manager expects to
provide long-term growth potential. We remain committed to investing through
the economic cycle, as experience suggests that this can produce superior
returns over the longer term. This environment can also provide an opportunity
for the Company to make high quality investments and build strategic stakes in
businesses with great potential, at good prices. This applies to both new
investments and follow-on investments in the portfolio. Although the AIM
market remains depressed with limited near-term visibility of new quoted
dealflow opportunities, the Manager sees a good pipeline of potential unquoted
investments in the short term, pending a recovery in listed UK small
companies. UK quoted takeover activity remains elevated - which may provide
enhanced opportunities for exits and for valuation upside from the existing
AIM portfolio.
We are confident that the Manager is suitably positioned to provide the
necessary levels of support to our portfolio companies and remains focused on
retaining, recovering and helping to grow value in existing and future
investee companies.
Sarah Fromson
Chair
10 June 2025
Investments in the period
Company Location Sector Activity Book cost £'000
Unquoted investments
New
Gentianes Solutions Ltd (trading as Much Better Adventures) Bristol Consumer markets Adventure travel marketplace 1,025
Mobility Mojo (UK) Ltd Dublin Technology Provider of software to evaluate the accessibility of building environments 447
Follow-on
SecureCloud+ Ltd Berkshire Technology Defence and public sector IT systems 530
Orri Ltd London Healthcare & education Provider of intensive day care treatments for eating disorders 250
Branchspace Ltd London Technology Specialist digital retailing consultancy and software provider to the aviation 203
and travel industry
Revlifter Ltd London Technology AI platform using advanced behavioural analytics to deliver tailored 182
promotions to users
Counting Ltd London Business services Banking and accounting software for small businesses 132
Focal Point Positioning Ltd Cambridgeshire Technology Research and development focused technology business focusing on global 91
navigation and satellite systems
Total unquoted investments 2,860
AIM-traded investments
Follow-on
IXICO plc London Healthcare & education Provides technology enabled services to the biopharmaceutical industry 578
worldwide
SEEEN plc(#) London Technology A video technology business 168
Oberon Investments Group plc London Business services Wealth advisory service for individuals and businesses 164
Total AIM-traded investments 910
Total investments in the period* 3,770
(#) Investment into unquoted convertible loan note
* Includes unquoted and AIM investments only
Realisations in the period
Company First investment date Original book cost(#) £'000 Proceeds(‡ ) Overall multiple return (x) IRR (%)
£'000
Unquoted realisations
MXC Capital Ltd Tender offer May 15 64 30 0.5 -
Total unquoted realisations 64 30
AIM-traded realisations
SEEEN plc Market sale Sep 19 798 192 0.2 -
Cerillion plc Market sale Nov 15 2 54 25.7 41.3
Crossword Cybersecurity plc* Written off July 21 2,322 - - -
Total AIM - traded realisations 3,122 246
Total realisations in the period** 3,186 276
(#) Residual book cost at realisation date.
(‡) Proceeds at time of realisation including interest.
* Only equity written off. Convertible loan note still held.
** Includes unquoted and AIM investments only.
Responsibility statement of the Directors in respect of the half-yearly report
Half-yearly report
The important events that have occurred during the period under review, the
key factors influencing the financial statements and the principal
uncertainties for the remaining six months of the financial year are set out
in the Chair's statement and the Strategic report.
The principal risks facing the Company are unchanged since the date of the
Company's Annual Report for the financial year ended 30 September 2024 and
continue to be as set out in that Report on pages 24 and 25.
Risks faced by the Company include but are not limited to; loss of approval as
a Venture Capital Trust, legislative risk, investment performance risk, risk
of economic, political and other external factors, regulatory and compliance
risk and operational risk. The Board considers the conflicts in Ukraine and
the Middle East to be factors which permeate these risks, and their impacts
for the remaining six months of the year continue to be kept under review.
Responsibility statement
Each Director confirms that to the best of their knowledge:
· the condensed set of financial statements has been prepared in
accordance with FRS 104 Interim Financial Reporting Standards and gives a true
and fair view of the assets, liabilities, financial position and profit or
loss of the Company.
· This half-yearly report includes a fair review of the information
required by:
a) DTR 4.2.7R of the Disclosure Guidance and Transparency Rules,
being an indication of important events that have occurred during the first
six months of the financial year and their impact on the condensed set of
financial statements; and a description of the principal risks and
uncertainties for the remaining six months of the year; and
b) DTR 4.2.8R of the Disclosure Guidance and Transparency Rules,
being related party transactions that have taken place in the first six months
of the current financial year and that have materially affected the financial
position or performance of the Company during that period; and any changes in
the related party transactions described in the last annual report that could
do so.
The half-yearly report was approved by the Board of Directors on 10 June 2025
and was signed on its behalf by Ms Sarah Fromson, Chair.
Sarah Fromson
Chair
10 June 2025
Financial Statements
Condensed income statement
For the six months to 31 March 2025 (Unaudited)
Six months to Six months to Year to
31 March 2025
31 March 2024
30 September 2024
Notes Revenue Capital Total Revenue Capital Total Revenue Capital Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
(Losses)/gains on investments 5 - (14,718) (14,718) - 8,029 8,029 - 15,024 15,024
Income 1,869 - 1,869 2,100 - 2,100 3,804 - 3,804
Investment management fee (611) (1,834) (2,445) (593) (1,779) (2,372) (1,252) (3,757) (5,009)
Other expenses (383) - (383) (387) - (387) (721) (1) (722)
Profit /(loss) before taxation 875 (16,552) (15,677) 1,120 6,250 7,370
1,831 11,266 13,097
Taxation - - - - - - - - -
Profit/(loss) for the period, being total comprehensive income for the period 875 (16,552) (15,677) 1,120 7,370 1,831 11,266 13,097
6,250
Return per ordinary share:
Basic and Diluted 0.22p (4.19p) (3.97p) 0.31p 1.71p 2.02p
2 0.48p 2.95p 3.43p
All items in the above statement derive from continuing operations.
There are no recognised gains and losses other than those disclosed in the
Income Statement.
The revenue column of the Income Statement includes all income and expenses.
The capital column accounts for the realised and unrealised profit or loss on
investments and the proportion of the management fee charged to capital.
The total column of this statement is the unaudited Statement of Total
Comprehensive Income of the Company prepared in accordance with the Financial
Reporting Standard ("FRS"). The supplementary revenue return and capital
return columns are prepared in accordance with the Statement of Recommended
Practice issued by the Association of Investment Companies ("AIC SORP").
Condensed statement of changes in equity
For the six months to 31 March 2025 (Unaudited)
Non-distributable reserves Distributable reserves
Called-up share capital Share Revaluation Capital Revenue
£'000 premium reserve Reserve* reserve
£'000 £'000 £'000 £'000 Total
£'000
At 1 October 2024 43,742 20,193 33,476 126,093 3,940 227,444
- - (12,018) (4,534) 875 (15,677)
Profit after taxation
Net proceeds of share issues, share buybacks & sale of shares from 1,203 5,330 - (4,832) - 1,701
treasury
Dividends paid - - - (7,833) (980) (8,813)
At 31 March 2025 44,945 25,523 21,458 108,894 3,835 204,655
For the six months to 31 March 2024 (Unaudited)
Non-distributable reserves Distributable reserves
Called-up share capital Share Revaluation Capital Revenue
£'000 premium reserve Reserve* £'000 reserve
£'000 £'000 £'000 Total
£'000
At 1 October 2024 39,628 - 23,062 144,092 2,877 209,659
- - 5,700 550 1,120 7,370
profit after taxation
Net proceeds of share issues, share buybacks & sale of shares from 1,347 6,666 - (1,627) - 6,386
treasury
Dividends paid - - - (7,965) (371) (8,336)
Share premium cancellation costs - - - (4) - (4)
At 31 March 2024 40,975 6,666 28,762 135,046 3,626 215,075
For the year ended 30 September 2024 (Audited)
Non-distributable reserves Distributable reserves Total
£'000
Called-up share capital Share Revaluation Capital Revenue
£'000 premium reserve Reserve* £'000 reserve
£'000 £'000 £'000
At 1 October 2023 39,628 - 23,062 144,092 2,877 209,659
Profit after taxation - - 10,414 852 1,831 13,097
Net proceeds of share issues, share buybacks & sale of shares from 4,114 20,193 - (4,325) - 19,982
treasury
Dividends paid - - - (14,522) (768) (15,290)
Share premium cancellation costs - - - (4) - (4)
At 30 September 2024 43,742 20,193 33,476 126,093 3,940 227,444
* Of the distributable reserves noted above £52,321,000 (31 March 2024 -
£79,777,000; 30 September 2024 - £52,321,000) is not available for dividend
distribution due to HMRC VCT rules.
Condensed balance sheet
As at 31 March 2025 (Unaudited)
As at As at
31 March
30 September 2024
Notes As at
2024 £'000
31 March
£'000
2025
£'000
Fixed assets
Unquoted investments 5 56,869 54,585 54,586
Traded on AIM 5 76,600 81,557 85,635
Collective investment vehicles 5 71,294 79,077 87,948
Investments 5 204,763 215,219 228,169
Current assets
Debtors 549 565 599
Cash at bank and on deposit 689 674 357
1,238 1,239 956
Creditors (amounts falling due within one year) (1,346) (1,383) (1,681)
Net current (liabilities)/assets (108) (144) (725)
Net assets 204,655 215,075 227,444
Capital and reserves
Called-up share capital 3 44,945 40,975 43,742
Share premium 25,523 6,666 20,193
Capital reserve 108,894 135,046 126,093
Revaluation reserve 5 21,458 28,762 33,476
Revenue reserve 3,835 3,626 3,940
Equity shareholders' funds 204,655 215,075 227,444
Net asset value per share 51.3p 57.7p 57.4p
Number of ordinary shares in circulation 399,201,045 372,888,416 396,183,675
Condensed statement of cash flows
For the six months to 31 March 2025 (Unaudited)
Six months to Six months to Year to
31 March
31 March
30 September
2024
2025
2024
£'000
£'000
£'000
Net cash outflow from operating activities (1,893) (1,799) (3,504)
Net cash inflow/(outflow) from investing activities 9,336 3,775 (1,480)
Net cash inflow/(outflow) before financing activities 7,443 1,976 (4,984)
Net cash (outflow)/inflow from financing activities (7,111) (1,972) 4,671
Increase/(decrease) in cash 332 4 (313)
Reconciliation of new cash flow to movement in net cash
Increase/(decrease) in cash 332 4 (313)
Opening cash at bank and on deposit 357 670 670
Closing cash at bank and on deposit 689 674 357
Reconciliation of (loss)/ profit before taxation
to net cash outflow from operating activities
(loss)/ Profit before taxation (15,677) 7,370 13,097
Losses/ (gains) on investments 14,718 (8,029) (15,024)
Changes in working capital and other non-cash items (934) (1,140) (1,577)
Net cash outflow from operating activities (1,893) (1,799) (3,504)
Notes to the financial statements
For the six months to 31 March 2025 (Unaudited)
1 Basis of preparation
The condensed financial statements for the six months to 31 March 2025
comprise the unaudited financial statements set out on pages 15 to 18 together
with the related notes on pages 19 to 22 of the full Half-Yearly Report. The
Company applies FRS 102 and the AIC SORP for its annual financial statements.
The condensed financial statements for the six months to 31 March 2025 have
therefore been prepared in accordance with FRS 104 'Interim Financial
Reporting' and the principles of the AIC SORP. They have been prepared on a
going concern basis. The financial statements have been prepared on the same
basis as the accounting policies set out in the Company's Annual Report and
Financial Statements for the year ended 30 September 2024.
The financial information contained in this half-yearly report does not
constitute statutory accounts as defined in sections 434 - 436 of the
Companies Act 2006. The half-yearly report for the six months ended 31 March
2025 and for the six months ended 31 March 2024 have been neither audited nor
reviewed by the Company's Auditor. The information for the year to 30
September 2024 has been extracted from the latest published audited financial
statements, which have been filed with the Registrar of Companies. The report
of the Auditor for the audited financial statements for the year to 30
September 2024 was: (i) unqualified; (ii) did not include a reference to any
matters to which the Auditor drew attention by way of emphasis without
qualifying their report; and (iii) did not contain a statement under section
498 (2) or (3) of the Companies Act 2006. No statutory accounts in respect of
any period after 30 September 2024 have been reported on by the Company's
Auditor or delivered to the Registrar of Companies.
The Company's half yearly report has been made available on the Company's
website (www.baronsmeadvcts.co.uk) and sent to shareholders where requested.
2 Performance and shareholder returns
Return per share is based on a weighted average of 395,163,475 ordinary shares
in issue (31 March 2024 - 365,445,232 ordinary shares; 30 September 2024 -
381,575,206 ordinary shares).
Earnings for the first six months to 31 March 2025 should not be taken as a
guide to the results of the full financial year to 30 September 2025.
3 Called-up share capital
The below table details the movement in called-up share capital during the
period.
Allotted, called-up and fully paid:
Ordinary shares £'000
437,415,822 ordinary shares of 10p each listed at 30 September 2024 43,742
12,028,256 ordinary shares of 10p each issued during the period 1,203
449,444,078 ordinary shares of 10p each listed at 31 March 2025 44,945
41,232,147 ordinary shares of 10p each held in treasury at 30 September 2024 (4,124)
9,010,886 ordinary shares of 10p each repurchased during the period and held (901)
in treasury
50,243,033 ordinary shares of 10p each held in treasury at 31 March 2025 (5,025)
399,201,045 ordinary shares of 10p each in circulation* at 31 March 2025 39,920
* Carrying one vote each.
During the six months to 31 March 2025 the Company issued 12,028,256 shares at
net proceeds of £6,481,000 (after costs). During the same period, the Company
purchased 9,010,886 shares to be held in treasury at a cost of £4,756,000
(including costs). The Company sold no shares from treasury. At 31 March 2025,
the Company held 50,243,033 ordinary shares in treasury. Shares may be sold
out of treasury below Net Asset Value as long as the discount at issue is
narrower than the average discount at which the shares were bought into
treasury.
Excluding treasury shares, there were 399,201,045 ordinary shares in
circulation at 31 March 2025 (31 March 2024 - 372,888,416 ordinary shares; 30
September 2024 - 396,183,675 ordinary shares).
4 Dividends
The final dividend for the year ended 30 September 2024 of 2.25p per share
(2.00p capital, 0.25p revenue) was paid on 17 March 2025 to shareholders on
the register on 14 February 2025. The ex-dividend date was 13 February 2025.
During the year to 30 September 2024, the Company paid an interim dividend on
9 September 2024 of 1.75p per share (1.65p capital, 0.10p revenue).
An interim dividend of 1.75p per share has been declared for the year to 30
September 2025 and is payable on 8 September 2025 to shareholders on the
register as of 8 August 2025. The ex-dividend date is 7 August 2025.
5 Investments
All investments are initially recognised and subsequently measured at fair
value. Changes in fair value are recognised in the Income Statement.
The methods of fair value measurement are classified into a hierarchy based on
reliability of the information used to determine the valuation.
· Level 1 - Fair value is measured based on quoted prices in an
active market.
· Level 2 - Fair value is measured based on directly observable
current market prices or indirectly being derived from market prices.
· Level 3 - Fair value is measured using a valuation technique that
is not based on data from an observable market.
The valuation of unquoted investments contained within level 3 of the Fair
Value hierarchy involves key assumptions dependent upon the valuation
methodology used. The primary methodologies applied are:
· Cost of recent investment.
· Multiple basis.
· Offer less 10 per cent.
The multiple basis approach involves more subjective inputs than the cost of
recent investment and offer approaches and therefore presents a greater risk
of over or under estimation. Key assumptions for the multiple basis approach
are the selection of comparable companies and the use of either historic or
forecast revenue or earnings, as considered most appropriate. Other
assumptions include the appropriateness of the discount magnitude applied for
reduced liquidity and other qualitative factors. These assumptions are
described in more detail in note 2.3 in the Company's Report and Financial
Statements for the year to 30 September 2024. The techniques used in the
valuation of unquoted investments have not changed materially since the date
of that report.
Level 1 Level 2 Level 3
Collective
Traded investment
on AIM Unquoted vehicles Unquoted Total
£'000 £'000 £'000 £'000 £'000
Opening book cost 64,469 - 66,213 64,011 194,693
Opening unrealised appreciation/(depreciation) 21,166 - 21,735 (9,425) 33,476
Opening fair value 85,635 - 87,948 54,586 228,169
Movements in the period:
Transfer between levels (5,623) 2,972 - 2,651 -
Purchases at cost 742 - 7,098 3,028 10,868
Sale - proceeds (246) - (19,280) (30) (19,556)
Sale - realised (losses)/gains (86) - (438) 30 (494)
Unrealised (losses)/gains realised during the period (2,790) - 656 (72) (2,206)
Decrease in unrealised appreciation (1,032) (2,478) (4,690) (3,818) (12,018)
Closing fair value 76,600 494 71,294 56,375 204,763
Closing book cost 56,466 2,972 54,249 69,618 183,305
Closing unrealised appreciation/(depreciation) 20,134 (2,478) 17,045 (13,243) 21,458
Closing fair value 76,600 494 71,294 56,375 204,763
Equity shares 76,600 494 - 6,957 84,051
Preference shares - - - 39,606 39,606
Loan notes - - - 9,812 9,812
Collective investment vehicles - - 71,294 - 71,294
Closing fair value 76,600 494 71,294 56,375 204,763
In the 6 months ending 31 March 2025, two investments held, I-nexus Global plc
and Merit Group plc previously Level 1 were transferred to Level 3 following
their delistings from AIM.
One investment held, Scholium Group plc previously level 1 was transferred to
level 2 as it is now being priced using JP Jenkins, a platform for trading
unlisted assets, following its delisting from AIM.
Two investments held, Fulcrum Utility Services Ltd and LoopUp Group plc
previously level 3 following their delistings from AIM were transferred to
Level 2 as they are now being priced using JP Jenkins, a platform for trading
unlisted assets.
6 Other required disclosures
6.1 Segmental reporting
The Company has one reportable segment being investing in primarily a
portfolio of UK growth businesses, whether unquoted, traded on AIM or
collective investment vehicles.
6.2 Principal risks and uncertainties
The Company's assets consist of equity and fixed interest investments, shares
in collective investment schemes, cash and liquid resources. Its principal
risks are therefore market risk, price risk, credit risk and liquidity risk.
Other risks faced by the Company include loss of approval as a Venture Capital
Trust, legislative, investment performance, economic, political and other
external factors, regulatory and compliance and operational risks. These
risks, and the way in which they are managed, are described in more detail in
the principal risks and uncertainties table within the Strategic report
section in the Company's Annual Report and Financial Statements for the year
ended 30 September 2024. The Board continues to regularly review the risk
environment in which the Company operates.
6.3 Related parties
Gresham House Asset Management Ltd (the "Manager") manages the investments of
the Company. The Manager also provides or procures the provision of
secretarial, accounting, administrative and custodian services to the Company.
Under the management agreement, the Manager receives a fee of 2.5 per cent per
annum of the net assets of the Company up to and including £209,658,860
(being the total net assets of the Company as at 30 September 2023) and 2.0
per cent per annum of the amount by which the net assets of the Company exceed
£209,658,860. This is described in more detail under the heading 'The
management agreement' within the Strategic Report in the Company's Annual
Report and Financial Statements for the year ended 30 September 2024.
During the period, the Company incurred the following fees payable to the
Manager:
Six months to Six months to Year to
31 March 31 March 30 September
2025 2024 2024
£'000 £'000 £'000
Management fees 2,445 2,372 5,009
Secretarial and accounting fees 92 89 178
Performance fees - - -
The performance fee is described in more detail under the heading 'Performance
fees' within the Strategic Report in the Company's Annual Report and Financial
Statements for the year to 30 September 2024.
Under the terms of an Offer for Subscription, launched on 13 January 2025, the
Manager was entitled to fees of 4.50% of the investment amount received from
investors. This amount totalled £161,000, out of which all the costs
associated with the allotments were met.
6.4 Going concern
After making enquiries, and bearing in mind the nature of the Company's
business and assets, the Directors consider that the Company has adequate
resources to continue in operational existence for the foreseeable future. In
arriving at this conclusion, the Directors have considered the Company's cash
balances, the liquidity of the Company's investments and the absence of any
gearing. The Directors are therefore also satisfied that the Company has
adequate financial resources to continue in operation for at least the next 12
months and that, accordingly, it is appropriate to adopt the going concern
basis in preparing the financial statements.
6.5 Post balance sheet events
The following events occurred between the balance sheet date and the signing
of these financial statements:
· The 30 April 2025 NAV of 52.2p was announced on 7 May 2025 and
the 31 May 2025 NAV of 54.1p was announced on 5 June 2025. At the date of
publishing this report, the Board is unaware of any matter that will have
caused the NAV per share to have changed significantly since the latest NAV.
· Issued 12.6mn Ordinary Shares of 10.0p on 3 April 2025 at an
average price of 56.0p per share.
· Issued 1.2mn Ordinary Shares of 10.0p on 1 May 2025 at an average
price of 53.2p per share.
· Three new investments, into Penfold Technology, Spinners and Nu
Quantum, completed between April and May 2025, totalling £2.8mn.
· One follow-on investment, into Airfinity, completed in April
2025, totalling £0.4mn.
· Totally plc announced on 6 June 2025 their intention to appoint
administrators and requested a suspension of trading in the company's shares
with immediate effect.
Corporate Information
Directors Brokers
Sarah Fromson (Chair)(†) Panmure Liberum Limited
Adriana Stirling* Ropemaker Place, Level 12
Graham McDonald(Δ) 25 Ropemaker Street
Tim Farazmand(#) London EC2Y 9LY
Tel: 020 3100 2000
Secretary
Gresham House Asset Management Ltd Auditor
BDO LLP
Registered Office 55 Baker Street
5 New Street Square London W1U 7EU
London EC4A 3TW
Solicitors
Investment Manager Howard Kennedy LLP
Gresham House Asset Management Ltd 1 London Bridge
5 New Street Square London SE1 9BG
London EC4A 3TW
Tel: 020 7382 0999 VCT Status Adviser
PricewaterhouseCoopers LLP
Registered Number 1 Embankment Place
04115341 London WC2N 6RH
Registrars and Transfer Office Website
The City Partnership (UK) Ltd www.baronsmeadvcts.co.uk (http://www.baronsmeadvcts.co.uk/)
The Mending Rooms
Park Valley Mills
Meltham Road
Huddersfeld HD4 7BH
Tel: 01484 240 910
(†) Chair of the Nomination Committee.
* Chair of the Audit & Risk Committee.
(Δ) Senior Independent Director
(#) Chair of the Management Engagement and Remuneration Committee.
LEI: 2138008D3WUMF6TW8C28
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