REG - British Smaller Co's - 3rd Quarter Results

British Smaller Companies VCTAnnouncement

15/03/2024 12:15

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RNS Number : 0800H  British Smaller Companies VCT PLC  15 March 2024

British Smaller Companies VCT plc

Interim Management Statement

For the quarter ended 31 December 2023

British Smaller Companies VCT plc (the "Company") presents its interim
management statement for the quarter ended 31 December 2023. The statement
also includes relevant financial information between the end of the quarter
and the date of this statement. A copy of this interim management statement
can be found at www.bscfunds.com (http://www.bscfunds.com) .

Overview

In the quarter to 31 December 2023, the Company's Net Asset Value per share
was up by 3.3 pence, or 4.0 per cent of the opening NAV, prior to the payment
of the interim dividend of 2.0 pence on 8 December 2023.  The FTSE Small Cap
Index rose by 5.4 per cent during the period.

The Company's Total Return at 31 December 2023 was up 3.3 pence, to 262.6
pence per ordinary share.

During the quarter, the Company invested a further £0.8 million into Force24
and £0.5 million into Vuealta. Subsequent to the quarter end, the Company has
invested £1.8 million into three follow on investments; Outpost, Relative
Insight and SharpCloud.

In November 2023 the Company exited its investment in E2E for £2.0 million,
representing a 2.5x return on the Company's cost.  Also in November, the
investment in MacroArt was realised for £1.5 million, representing a 2.0x
return on cost for the Company.

The Company has seen further realisations post-quarter-end, partially
realising its investments in KeTech and Arcus in January 2024, and fully
exiting its investment in Displayplan in February 2024, all at valuations in
line with fair value at 31 December 2023.

To maximise shareholder value, the KeTech business was split into its two
component parts, Rail and Defence.  The Defence business subsequently sold in
January 2024, generating proceeds of £1.5 million.  To date, the Company has
realised proceeds of £4.1 million from its KeTech investment, a 2.0x return
on cost, while still retaining its investment in the Rail Business, which at
the period end was valued at £1.3 million.

In February 2024, the Company sold its investment in Displayplan for £9.0
million.  Total proceeds received over the life of the investment are £12.5
million, an excellent 9.6x return on the Company's cost. There is the
potential for further deferred proceeds in due course.

Performance

The table below sets out movements in key metrics for the Company.

 

                                  30 September 2023  Increase in Value  Shares issued/dividend paid  Buyback of shares  Movement    31 December 2023

                                                                                                                        In Period
 Net Assets (£m)                  198.6              7.8                (3.8)                        (0.8)              3.2         201.8
 NAV per share (PPS)              82.4               3.3                (2.0)                        -                  1.3         83.7
 Cumulative dividends paid (PPS)  176.9              -                  2.0                          -                  2.0         178.9
 Total Return (PPS)               259.3              3.3                -                            -                  3.3         262.6
 Shares in issue                  240,991,484        -                  1,220,008                    (975,567)          244,441     241,235,925

Cumulative dividends paid at 31 December 2023 were 178.9 pence per ordinary
share (30 September 2023: 176.9 pence per ordinary share) following the
interim dividend of 2.0 pence paid on 8 December 2023.

The movements in NAV and NAV per ordinary share are set out in the table
below:

                              £m          Pence per

                                          ordinary share
 NAV at 30 September 2023          198.6            82.4
 Increase in portfolio value  7.6         3.2
 Net operating income         0.2         0.1
                              7.8         3.3
 Issue/buy-back of shares     0.2         -
 Total Return in the period        8.0              3.3
 NAV before dividends              206.6            85.7
 Dividends paid                    (4.8)            (2.0)
 NAV at 31 December 2023           201.8            83.7

 

Dividends and shares in issue

On 8 December 2023 the Company issued 1,220,008 shares under the Company's
Dividend Re-investment Scheme (DRIS).

Under its standing buyback authority, on 18 December 2023 the Company
purchased 975,567 shares at 76.88 pence per share at a cost of £0.8 million.
These shares are held in treasury.

On 30 January 2024 the Company issued 22,560,594 shares in relation to its
2023/24 fundraising, following which the Company's issued share capital
consists of 263,796,519 ordinary shares with voting rights and 24,501,263
shares held in treasury.

Net assets

Net assets at 31 December 2023 comprised the following:

                                     £000     % of net assets
 Unquoted investments at fair value  135,649  67.2
 Cash and money market funds         63,490   31.5
 Other net assets                    2,655    1.3
 Net assets                          201,794  100.0

Investments

The investment portfolio at 31 December 2023 comprised:

                    Valuation  Cumulative valuation as a % of net assets

                    £000
 Matillion          26,440     13.1%
 Unbiased           12,545     19.3%
 Outpost            8,819      23.7%
 Displayplan        8,806      28.1%
 Elucidat           6,596      31.3%
 Force24            6,189      34.4%
 Wooshii            5,457      37.1%
 SharpCloud         4,965      39.6%
 Vypr               4,834      41.9%
 ACC Aviation       4,340      44.1%
                    88,991     44.1%
 Other investments  46,658     67.2%
 Total investments  135,649    67.2%

Portfolio performance

Over the quarter to 31 December 2023, the aggregate unquoted portfolio
valuation has increased by £7.6 million.

Fundraising

The Company announced a new share offer on 20 September 2023, alongside
British Smaller Companies VCT2 plc, with the intention of raising up to £90
million, in aggregate, which included an over-allotment facility of £25
million, in aggregate. The offers closed to new Applications on 16 February
2024. Gross Applications of £90 million have been received, of which c.£55.5
million relate to the Company. The first allotment of £30 million (£18.6
million relating to the Company) took place on 30 January 2024; the second and
final allotment will take place in early April 2024.

Outlook

In the last quarter of the year, there was a notable upturn in the economic
forecast. We witnessed a decline in inflation rates and a growing consensus
that interest rates might be lowered in 2024. Nevertheless, we're keeping a
close eye on any potential shifts, particularly given recent instability in
the Middle East, which have raised concerns about a resurgence in input costs.
Additionally, upcoming elections in both the UK and US in 2024 may influence
the economic outlook.

The portfolio has demonstrated robust revenue growth in an efficient manner
through a tough trading period, which should leave portfolio companies well
positioned to continue their positive trajectory as the economic environment
improves.  Moreover, the close of the Company's 2023/24 fundraising in
February positions the Company strongly to continue supporting the portfolio
and to invest further in new opportunities in the year ahead.

The information contained within this announcement is deemed by the Company to
constitute inside information as stipulated under the Market Abuse Regulations
(EU No. 596/2014). Upon the publication of this announcement via Regulatory
Information Service this inside information is now considered to be in the
public domain.

15 March 2024

For further information please contact:

David Hall                YFM Private Equity
Limited
Tel:  0113 244 1000

Alex Collins              Panmure Gordon (UK) Limited
                            Tel:  0207 886 2767

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