REG - Molten Ventures VCT - Final Results
19/06/2025 07:00
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RNS Number : 4702N Molten Ventures VCT PLC 19 June 2025
Molten Ventures VCT plc
LEI: 2138003I9Q1QPDSQ9Z97
19 June 2025
Final Results for the year ended 31 March 2025
David Brock, Chairman, comments:
"Molten Ventures plc is actively funding innovation in deep‑tech, SaaS and
enterprise technology with a diverse portfolio across AI, quantum computing,
financial services and healthcare. These pioneering companies position the
VCT to benefit from the rising adoption of technology to drive business
efficiency and growth. During the period Molten has also strengthened its
investment process and oversight, appointing a new senior partner to lead the
investment team and a new CEO to lead Molten Ventures as a whole.
Strengthening the senior leadership team has contributed to a more resilient
investment and exit process, which we expect to see deliver improved fund
performance over time."
HIGHLIGHTS
· Net Asset Value of £118.2 million (43p per share) at year-end;
mid-market share price at 37.5p. NAV total return of -5.6%, after adding back
dividends. 2.5p dividend paid (5.2% yield); on track to meet 5% target
dividend for 25/26.
· Portfolio remains resilient and appropriately valued in today's
climate. Underperformers written down; core portfolio continues to perform to
plan. Clear cash runways maintained across the portfolio.
· Increased focus on exits, with the manager actively working to
realise value. Four successful exits delivered in 12 months, including
Freetrade (April 2025), with £12.2 million proceeds and a 3.0x return on
cost.
· Investment focus remains on exceptional, disruptive high-tech
businesses. Strong pipeline of opportunities, with market correction
presenting attractive lower entry points. Continued investment activity:
£11.2 million deployed during the year, alongside EIS and PLC funds
· £38.0 million of previously locked reserves released, enabling
buybacks and dividends. 100% of 31 March 2025 buyback requests cleared.
· £15.3 million (net) Prospectus Offer completed during the year;
£6.6 million (net) raised post-period. Directors and Managers have invested
over £1 million, continuing strong alignment.
· Board succession planning ongoing with two new VCT Directors
appointed bringing operational, deep tech and venture capital trust sector
expertise.
OVERVIEW
Molten Ventures VCT is a £118.2 million, steadily growing, investment company
that gives a distinctive opportunity to invest with the experienced,
technology focused, venture capital team at Molten Ventures plc ("Molten" or
"Group") in early stage companies that have exciting growth prospects whilst
also giving investors tax relief, tax free dividends and tax free capital
returns.
The Company benefits from Molten's exceptional experience in technology with
an emphasis on enterprise technology, deeptech and hardware, digital health
and consumer technology, all of which add to the portfolio's focus on UK
growth and leading-edge expertise.
Through Molten's co-investment connections in future-focused sectors, and its
engagement with investee companies, this VCT provides an enhanced opportunity
for investors to make a serious contribution to the future of the UK's vital
early stage economy thereby making a key contribution to the UK, whilst at the
same time enjoying tax relief on the investment and tax free dividends, in
particular as further significant reserves become available for distribution
from April 2025. Those reserves will enable the Company to maintain buy-backs
and target tax free dividends of 5% of net asset value per share.
FINANCIAL SUMMARY
31 March 2025 31 March 2024
pence pence
Net asset value per share ("NAV") 43.0 48.2
Cumulative dividends paid since launch 117.6 115.1
Total Return (NAV plus cumulative dividends paid per share) 160.6 163.3
Dividends in respect of financial year ended 31 March 2025
Interim dividend paid per share 1.00 1.0
Final dividend per share (payable on 30 September 2025) 1.15 1.5
2.15 2.5
CHAIRMAN'S STATEMENT
Introduction
Molten believes it has a unique edge in finding and selecting visionary,
disruptive, high-growth technology companies and providing the funding, energy
and monitoring skills to help them grow and to exit.
The past twelve months have been a period of strategic refocus. Following a
change in CEO, Molten, owner of the investment manager, has strengthened its
emphasis on process, performance, and portfolio discipline. This has included
a renewed focus on realising exits, the appointment of a new senior investment
partner, and deeper engagement with portfolio companies. These steps have
contributed to a more stable, resilient portfolio and a clearer path to value
creation.
At the year-end £73.8 million of the portfolio was invested largely in
technology, £12.2 million in the legacy portfolio and £32.2 million of cash
and cash equivalents reflected another successful fund-raising round.
Your VCT has some outstanding investee companies: Thought Machine, Focal Point
Positioning, Riverlane, Satvu, and Form3 all enabling clients to realise
significant benefits by embedding next-gen technology in payments, satellites,
chemical processes, wearables and vehicles. More information on these can be
found in the Manager's Report and Review of Investments below.
The VCT board has been active in oversight of process, marketing, meeting
investors and promoting Shareholders' interests in future portfolio
performance. Two new Directors have been appointed over the last 18 months.
Net asset value and results
As at 31 March 2025, the Company's Net Asset Value per share ("NAV") stood at
43.0p, a decrease of 5.6% after adding back dividends paid, which was
predominantly incurred in the first half year of the year. Our valuation
methodology takes careful note of commercial performance and is cautious;
taking any write downs at an early stage. While recent performance has been
disappointing, partly reflecting a correction from elevated private market
valuations seen in prior years, the main portfolio remains strong and
continues to make solid progress. We are confident that this momentum will
support improved financial performance going forward.
A summary of the total return for Shareholders who invested in the Company's
various other fundraisings is included on page 6 of the Annual Report.
The loss on ordinary activities after taxation for the year was £7.5 million
(2024: £8.1 million), comprising a revenue gain of £0.4 million (2024: loss
of £0.2 million) and a capital loss of £7.9 million (2024: £7.9 million).
Venture capital investments
Portfolio allocation
In line with the strategy that has been pursued in recent years, the Company's
growth technology investments now form a substantial proportion of the
investment portfolio. The split with the older legacy investments at the
year-end is summarised as follows:
Growth Cash and cash equivalents
Portfolio split as at 31 March 2025 Technology Legacy £'000 Total
£'000 £'000 £'000
Cost 70,987 10,903 32,188 114,078
Gains 2,904 1,276 - 4,180
Valuation 73,891 12,179 32,188 118,258
Percentage of portfolio 62.5% 10.3% 27.2% 100.0%
Portfolio activity
Further commentary on the portfolio, together with a schedule of additions,
disposals and details of the ten largest investments can be found within the
Investment Manager's Report and Review of Investments.
In the year the Company paid dividends of 2.5p per share equivalent to 5.2% of
the starting year NAV, in line with the stated dividend policy and the Company
intends to continue that dividend policy for current and future subscribing
Shareholders.
A further dividend of 1.0p per share was paid on 25 April 2025. This is in
line with the prior year's first payment.
The Board is proposing to pay a final dividend of 1.15p per share. This
dividend will be paid, subject to Shareholder approval, on 30 September 2025
to Shareholders on the register at 22 August 2025. This will bring the total
dividends paid in respect of the year to 2.15p per share, an equivalent yield
of 5.0% on the 31 March 25 NAV.
Shareholders are reminded that the Company operates a Dividend Reinvestment
Scheme ("DRIS"), which allows Shareholders to reinvest their dividends in new
shares and obtain income tax relief on that new investment.
Fundraising
The Company received £15.3 million (net of costs) in the year in respect of
the 2023 Offer for Subscription.
The Company launched a successful Offer for Subscription to raise £6.7
million in October 2024 which completed, fully subscribed, shortly after the
year end.
On 4 April 2025, the Company allotted 15,252,988 Shares at an average price of
43.0p per Ordinary Share under the terms of the Offer for Subscription dated
11 October 2024.
On 16 April 2025, the Company allotted 278,213 Shares at an average price of
42.6p per Ordinary Share under the terms of the Offer for Subscription dated
11 October 2024.
The Company expects to launch another Offer for Subscription later this year.
Share Buybacks
The Company has a target policy of purchasing its own shares that become
available in the market at a discount of approximately 5% to the latest
published NAV, subject to regulatory and liquidity constraints. Resolution 13
on page 66 of the Annual Report will be proposed at the AGM, to renew the
authority for the Company to purchase its own shares.
Over the past two years, the VCT has continued its buyback policy, albeit at a
reduced level. This reduction, in place until 1 April 2025 was solely due to
VCT regulations, which limit buybacks from reserves linked to capital raised
in the preceding three to four years (depending on the share allotment date).
During the year, the Company purchased a total of 1,047,051 shares at an
average price of 45.1p per share.
The Board now has full flexibility to operate, and we are pleased to inform
Shareholders that 100% of the outstanding shares offered, a total of 9,344,254
shares, were purchased post-period in April 2025 at an average price of 39.8p
per share, representing the stated 5% discount to NAV. This purchase cleared
the backlog at that date.
Buybacks are expected to be undertaken from time to time and any Shareholders
who are considering selling their shares will need to use a stockbroker. Such
Shareholders should ask their stockbroker to register their interest in
selling their shares with Panmure Liberum.
Directorate
The Board is engaged in succession planning as several of the Board members
have been on the Board for more than the nine- year guideline set by the
Corporate Governance Code. As part of that Nicholas Lewis has retired from the
Board on 31 March 2025, after 26 years. As well as his Non-Executive Director
contribution Nicholas's firm Downing LLP provided company secretarial services
to the VCT from inception until 26 February 2024. We would like to thank
Nicholas for his invaluable contribution to the VCT. He leaves with our best
wishes for the future.
On 1 April 2025, Nicholas was replaced by Steven Clarke. Steven brings over 30
years of experience in private equity and non-executive roles across the
technology and business services sectors. Over the past eight years, Steven
has held non- executive or investing chairman roles in eight businesses, three
of which have achieved successful exits. He has worked with a range of
institutional investors, including Motive Partners, BGF, Breakthrough Energy
Ventures, M&G Catalyst, SBI, and Mercia. He was a non-executive director
of Thames Ventures 2 VCT plc until February 2025. His experience includes
advising on growth strategies, funding, and transaction planning, with a
particular focus on companies scaling up into international markets.
This is the second step towards a phased succession of the Board and the
process will continue.
Annual General Meeting ('AGM')
The AGM will take place at 20 Garrick Street, London WC2E 9BT on 17 September
2025 at 11:15 a.m.
Four items of special business are proposed at the AGM:
• one in respect of the authority to buy back shares as noted above;
• two and three in respect of the authority to allot shares; and
• four to cancel the share premium account and capital redemption reserve.
The authority to allot shares provides the Board with the opportunity to issue
shares for the next fundraising that is being planned without having to incur
the expense of seeking separate approval via a Shareholder circular. Any
further fundraising decisions will take account of the level of uninvested
funds and the rate of investment.
Outlook
In the period following year-end, geopolitical developments, notably the
introduction and subsequent pause of tariffs by the US government, have
contributed to an increasingly uncertain global trading environment. Our
preliminary assessment indicates that our portfolio, being technology and
software focused, is less exposed to the direct impact of tariffs.
There are also signs that the trough in technology valuations may now be
behind us. Interest rates are generally falling and M&A activity is on the
increase, as proven by the exit of four VCT portfolio companies in the
trailing twelve months. The Board believes that the portfolio contains many
investments that should be able to take advantage of improving sentiment.
I look forward to updating Shareholders in the Half Yearly Report which will
be published towards the end of the year.
David Brock
Chairman
18 June 2025
INVESTMENT MANAGER'S REPORT
Our focus has been on delivering an ongoing pipeline of realisations and
growing the value of the portfolio through the active support of existing
companies and on making new investments. In the period we have made six new
investments, and three follow-on investments, alongside a flurry of profitable
exits all of which are detailed below.
The valuation movements over the year showed a NAV Total Return decrease of
5.6% (after adding back dividends paid in the period), the majority of which
was recognised in the first six months, with a steadying in the NAV achieved
over the second half (-0.5%).
When valuing the portfolio we believe we have been cautious in taking upside
valuations and prudent on write downs.
Portfolio
At the year end, Molten technology companies represented 62.5% of the
portfolio and pre-Molten legacy companies 10.3%. The net asset valuation of
£118.2 million was split 72.8% in investments, and 27.2% in cash and cash
equivalents.
Within the portfolio our view is that, by value (NAV excluding cash), 70% of
the portfolio is performing, or emerging as performing broadly as we might
expect.
A further 12% are at an early stage of their commercial journey with
reasonable prospects, and the balance require further help to get on to a
viable growth path or exit.
Using management data for the calendar year ending 31 December 2024, 10
companies representing 36% of the portfolio NAV (excluding cash) has generated
revenues or Annual Recurring Revenue ("ARR") above £5 million. Of these, 5
companies representing 13% of the portfolio NAV have revenues/ARR above £10
million and 3 companies representing 21% of the portfolio NAV have revenues
above £20 million. We anticipate that the number of companies to achieve
revenues above £5 million for 2025 will increase.
Of the remaining portfolio, 38% have generated revenues/ ARR between £1
million and £5 million. A further, 26% of the portfolio NAV is invested in
deeptech companies, which are research and development heavy technologies that
are early in commercial traction as they look to disrupt traditional
industries.
Across the portfolio our companies continue to have strong cash runways, with
almost 80% of the portfolio expected to be able to fund their business for the
next 12 months or in the process of raising new money.
At this time, we consider that several portfolio companies have the potential
to contribute positively to NAV. Below you will find a high-level overview of
selected companies within the portfolio and the Manager's view on potential
for value creation:
Well funded potential category winners
• Thought Machine, Form3, Riverlane
These three companies represent £20.7 million, 17.4% of NAV and have a
current combined Enterprise Value ("EV") of over $2 billion. We have
well-founded expectations of target EVs that could represent increases over
the current carrying values.
Near term potential uplifts (12-36 month horizon)
• IMU, Modo, Anima
These three companies represent £7.4 million, 6.3 % of NAV and are all
performing well and receiving significant inbound interest from third party
investors to invest in future funding rounds at materially higher valuations
than the current carrying values.
Emerging companies with exciting prospects
• Satvu, Paragraf, AltruistIQ, BeZero Carbon, Focal Point Positioning
These five companies represent £19.7 million, 16.7% of NAV and are a mix of
enterprise and deep tech companies. Focal Point Positioning is developing
software that significantly enhances location accuracy, resilience. While
pre-revenue, the company is building commercial traction with leading OEMs and
chipset partners. The enterprise companies AltruistIQ and BeZero Carbon are
both in emerging climate tech categories.
Value add
Since the deal sharing agreement with Molten we have invested over £80
million into a wide range of software and technology enabled businesses. All
investments of value get close attention and have investor directors or
observers on their boards. The Molten Partnership Team boasts extensive
cross-sector expertise. Whether facilitating connections or sharing insights,
they are dedicated to supporting growth and exits (see exit highlights below).
The Molten Platform Team handles investment transactions and post-investment
portfolio engagement. Supported by legal, compliance, investor relations,
finance, and ESG specialists, we work closely to support our portfolio with
branding, regulatory compliance, public markets, governance, and implementing
sustainability related strategies as they scale.
Valuation movements
Within the year 14 companies had positive valuation uplifts of £8.9 million
and 22 companies had negative valuation movements of £11.9 million, albeit a
fair amount of these were related to adverse foreign exchange valuation
changes in the year.
Positive movements within the portfolio include Riverlane, Binalyze OÜ,
BeZero Carbon, and Koru Kids. Riverlane is the largest uplift at £2.0 million
as it closed a $75 million funding round which included participation by the
UK's National Security Strategic Investment Fund (NSSIF), closely followed by
BinalyzeOU (uplift of £1.9 million) a business in which Cisco also invested
in 2023.
BeZero Carbon (uplift of £0.2million) improved on the back of increased sales
growth, and Koru Kids (uplift of £1.5 million) is a new investment that was
structured to enhance the VCT returns on exit at a low valuation.
A proportion of our larger companies have not been immune from the wider
market shift towards prioritising profitability rather than growth with a
consequential slowing in value growth. Downward movements in this category
were recorded in Thought Machine (decline £3.1 million) and AIM listed Pulsar
Group plc (LSE:PULS). Regrettably the valuation of Pulsar has declined £0.8
million over the period but your Manager remains confident that valuation
recovery will be forthcoming in the future as the businesses delivers on its
strategy to cut costs and return to profitability. Pulsar recently reported
sales of over £60 million.
Detractors also include a subset that we have chosen not to fund again and
have little prospect of return. These include Evonetix (decline £1.3
million), Macranet (decline £1.0 million) and a combined decline of £5.5
million in Primary Bid, AllPlants, Unbound and Morressier. Gardin has been
written down but has attracted a new investor. While disappointing these write
downs were mainly taken in the first half of the year.
Exit Highlights
Within the year we successfully exited three investments, and one investment
post the period end.
The Molten portfolio team has instituted month by month tracking of each
company's exit readiness, coupled with a proactive 'Stage 1' programme of
relationship building with likely acquirers. This advance work - building
brand awareness, brokering distribution partners and integrating product
technology into proven category winners - means that when a formal sale
process ('Stage 2') opens, buyers already understand the strategic value on
offer.
FY25 provides evidence of the model in action. Cash proceeds of £11.0 million
were generated during the financial year, the majority of which was from two
realisations.
These realisations stand out not only for their scale but for the calibre of
the acquirers: Nasdaq-listed Hologic (Endomag), Worldpay (Ravelin), and
Freetrade (acquired by LSE-listed IG Group Holdings), the latter which
completed shortly after the period end, delivering strong returns and further
validating Molten's strategic approach.
These exits completed either at a premium or very close to the VCT carrying
values. By demonstrating the accuracy of net asset values across holdings, the
transactions reinforced confidence in the Group's valuation
methodology-providing a clear reference point for Shareholders and prospective
investors alike.
The highlight was portfolio company Endomagnetics Ltd ("Endomag"), the VCTs
second highest valued portfolio asset, which announced an acquisition offer
from NASDAQ listed Hologic Inc. The acquisition valued Endomag at
approximately $310 million and to date proceeds of £8.4 million have been
received with the prospect of further escrow payments to come. This represents
a multiple of 3.9x cost.
The VCT first invested in Endomag in 2018 when revenues were £6 million and
since then the company has grown its revenue fivefold. The acquisition
demonstrates our ability to support innovative businesses as they scale and
create value for our Shareholders through the cycle. Endomag's platform has
been installed in over 1,350 hospitals in over 45 countries globally, and more
than 500,000 women have received a better standard of breast cancer surgery
with Endomag's technologies. The company received many accolades on its
journey and more recently was awarded the King's Award for Enterprise.
Shareholders should feel pleased over the return and also that their
investment has not only helped to change lives but has assisted an early stage
UK healthtech company to breakthrough into global sales and a realisation to
Hologic.
Other realisations were made in Ravelin, a 'card not present' fraud detection
fintech business acquired by Worldpay, which yielded proceeds of £2.3 million
and a multiple of 2.0 times cost, together with proceeds of £0.3 million from
a small legacy investment returning 1.7 times cost, again with the prospect of
future escrow proceeds.
Post the period end Freetrade, a consumer stock trading platform, was sold to
IG Group Holdings PLC yielding proceeds of£1.1 million and a multiple of 1.9
times cost.
New investments
In the year total investments made were £11.2 million.
This compares with a total invested in the previous year of £16.4 million.
New and follow on investments alongside the Molten EIS and Molten Ventures plc
funds were made during the year into the following qualifying companies:
Global Satellite Vu Follow on investment £599,986
XMOS New investment £888,704
FintechOS Holding New investment £1,493,874
Dines App Limited New investment £300,000
Nationwide Engineering Research and Development Limited (trading as New investment £799,957
Concretene)
Expanding Circle (trading as AltruistIQ) Follow on investment £2,480,620
IESO Digital Health Limited Follow on investment £1,261,499
Modo Energy Limited New investment £1,888,890
Koru Kids Limited New investment £1,500,000
Total £11,213,530
Post year end activity
April has been a busy month. As mentioned in the exits paragraph above we were
delighted to complete the realisation of Freetrade. In the month the VCT also
paid its first dividend for the year at 1.0p per Share which is on track for
the target 5% annual yield and purchased all the 'sellers' stock of £3.7
million through the 5% discount to NAV buyback mechanism.
VCT Association ("VCTA")
Your Investment Manager remains an active member of the VCTA which represents
14 of the largest VCT fund managers and makes up over 90% of the £6.6 billion
VCT industry. The VCTA worked tirelessly to lobby Government for an extension
of the Sunset Clause on the VCT scheme which has been extended to 2035. Your
involvement as a Shareholder in the VCT is helping to grow UK SME businesses
and contribute to the UK economy.
Outlook
In summary the portfolio remains well diversified among the four technology
investment sectors with companies at different stages of maturity. We've
maintained a strong level of activity this year, with significant realisations
that have provided capital to pay dividends and maintain the buyback scheme.
As highlighted in the Chairman's Statement, recent macro events serve as a
reminder of how quickly market dynamics can change. While these events have
added short-term volatility, particularly in the public markets, our portfolio
remains focused on capturing long-term opportunities driven by disrupting
global industries.
The VCTs strong cash position and experienced team ensure we remain resilient
in a changeable investment environment. We remain focused on what we can
control and continue to invest with discipline, finding opportunities in
changing environments, backing businesses that are building for the long term
and creating value for our Shareholders. We remain cautiously optimistic for
the year ahead.
Elderstreet Investments Limited
Part of the Molten Ventures Group
18 June 2025
REVIEW OF INVESTMENTS
Portfolio of investments
The following investments were held at 31 March 2025. All companies are
registered in England and Wales, with the exception of Fulcrum Utility
Services Limited, which is registered in the Cayman Islands.
Valuation Movement % of portfolio Ownership
Cost Valuation in year by value interest
range***
Largest venture capital investments (by value) £'000 £'000 £'000
Fords Packaging Topco Limited 2,433 8,091 990 6.8% F
Form3 UK Limited(*) 1,420 7,980 24 6.7% A
Thought Machine Group Limited* 2,400 6,588 (3,099) 5.6% A
Riverlane Limited(*) 2,661 6,088 1,974 5.1% A
Focal Point Positioning Limited(*) 3,800 6,002 (415) 5.1% A
Expanding Circle Limited (trading as AltruistIQ)(*) 5,412 5,556 144 4.7% B
Global Satellite Vu Limited* 4,689 4,826 (153) 4.1% B
Binalyze OU* 2,161 4,079 1,917 3.5% A
Pulsar Group (formerly Access Intelligence plc)** 2,586 3,327 (829) 2.8% B
Melio Healthcare Limited (trading as IMU Biosciences)* 2,520 3,067 547 2.6% B
Koru Kids Limited* 1,500 3,000 1,500 2.5% C
Anima Group Inc* 2,653 2,474 (179) 2.1% B
Juliand Digital (trading as Zaptic)(*) 2,439 2,439 - 2.1% B
Impulse Innovations Limited (trading as Causelens)* 2,079 2,079 126 1.8% A
Hadean Supercomputing Limited* 1,775 1,891 - 1.6% A
40,528 67,487 2,547 57.1%
Other venture capital investments 41,362 18,583 (5,438) 15.7%
Cash and cash equivalents 32,188 32,188 - 27.2%
Total investments 114,078 118,258 (2,891) 100.0%
( )
(*)These companies have also received investment from other funds managed by
the Molten Ventures Group (Molten Ventures Plc and Molten Ventures EIS) as at
31 March 2025.
** Quoted on AIM
*** Fully diluted interest categorised as follows: Cat A: 0.0-5.0%, Cat B:
5.1-10.0%, Cat C: 10.1-15.0%, Cat D: 15.1-25.0%, Cat E: 25.0%-49.9%, F
>50%.
All venture capital investments are unquoted unless otherwise stated.
Investment movements for the year ended 31 March 2025
Additions
Cost
Venture capital investments £'000
Dines App Limited 300
Expanding Circle Limited * 2,481
FintechOS Holdindg B.V. 1,494
Global Satellite Vu Limited* 600
IESO Digital Health Limited * 1,261
Koru Kids Limited * 1,500
Modo Energy Limited 1,889
Nationwide Engineering Research and Development (trading as Concretene)
800
Xmos Limited 888
11,213
Disposals
Value at Proceeds Gain/(loss)
Cost 1 April 2024* vs cost
£'000 £'000 £'000 £'000
Venture Capital Investments
Endomagnetics Limited * 2,147 8,819 8,392 6,245
Hampshire Sport & Leisure Limited - 330 330 330
Ravelin Technology Limited * 1,133 2,187 2,289 1,156
Morrisier GmbH* 3,162 3,162 - (3,162)
6,442 14,498 11,011 4,569
These investments were revalued over time and until sold with any unrealised
losses included in the fair value of the investments.
*These companies have also received investment from other funds managed by the
Molten Ventures Group (Molten Ventures plc and Molten Ventures EIS) as at 31
March 2025.
DIRECTORS' RESPONSIBILITIES STATEMENT
The Directors are responsible for preparing the Report of the Directors, the
Strategic Report, the Directors' Remuneration Report and the financial
statements in accordance with applicable law and regulations. They are also
responsible for ensuring that the Annual Report includes information required
by the Listing Rules of the Financial Conduct Authority.
Company law requires the Directors to prepare financial statements for each
financial year. Under that law, the Directors have elected to prepare the
financial statements in accordance with United Kingdom Generally Accepted
Accounting Practice (United Kingdom Accounting Standards and applicable law),
including Financial Reporting Standard 102, the financial reporting standard
applicable in the UK and Republic of Ireland (FRS 102).
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 Company and of the profit or loss of the Company for that
period.
In preparing these 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 applicable UK Accounting Standards have been followed,
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 Company's transactions and disclose with
reasonable accuracy at any time the financial position of the 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 Company
and hence for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
Each of the Directors considers that the Annual Report, taken as a whole, is
fair, balanced and understandable and provides the information necessary for
Shareholders to assess the Company's position, performance, business model and
strategy.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Legislation in the United Kingdom governing the preparation and dissemination
of the financial statements and other information included in annual reports
may differ from legislation in other jurisdictions.
INCOME STATEMENT for the year ended 31 March 2025
Year ended 31 March 2025 Year ended 31 March 2024
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Income 1,665 - 1,665 980 - 980
Losses on investments - (6,053) (6,053) - (5,983) (5,983)
1,665 (6,053) (4,388) 980 (5,983) (5,003)
Investment management fees (618) (1,854) (2,472) (634) (1,903) (2,537)
Other expenses (648) - (648) (514) - (514)
Gain/(loss) on ordinary activities before tax 399 (7,907) (7,508) (168) (7,886) (8,054)
Tax on loss - - - - - -
Gain/loss attributable to equity shareholders, being total comprehensive
income for the period
399 (7,907) (7,508) (168) (7,886) (8,054)
Pence Pence Pence Pence Pence Pence
Basic and diluted loss per share 0.1 (2.9) (2.8) (0.1) (3.2) (3.3)
All Revenue and Capital items in the above statement derive from continuing
operations.
No operations were acquired or discontinued during the year.
The total column within the Income Statement represents the Statement of Total
Comprehensive Income of the Company prepared in accordance with Financial
Reporting Standards ("FRS 102"). The supplementary revenue and capital return
columns are prepared in accordance with the Statement of Recommended Practice
issued in July 2022 by the Association of Investment Companies ("SORP").
There has been no other comprehensive income in the period.
BALANCE SHEET at 31 March 2025
31 March 31 March
2025 2024
£'000 £'000 £'000 £'000
Fixed assets
Investments 86,070 91,921
Current assets
Debtors 142 213
Cash at bank and in hand 2,332 3,226
Money market funds 29,856 21,876
32,330 25,315
Creditors: amounts falling due within one year (168) (182)
Net current assets 32,162 25,133
Net assets 118,232 117,054
Capital and reserves
Called up share capital 13,758 12,146
Capital redemption reserve 114 62
Share premium account 39,553 25,510
Special reserve 50,152 62,190
Capital reserve - unrealised 18,006 25,886
Capital reserve - realised (1,481) (6,471)
Revenue reserve (1,870) (2,269)
Total equity Shareholders' funds 118,232 117,054
Basic and diluted net asset value per share 43.0p 48.2p
STATEMENT OF CHANGES IN EQUITY for the year ended 31 March 2025
Share Capital Share Special Capital Capital Revenue Total
capital Redemption Premium reserve reserve -unrealised reserve - realised reserve
reserve account
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
For the year ended 31 March 2024
At 1 April 2023 10,347 - 8,689 65,178 27,346 853 (2,101) 110,312
Total comprehensive income - - - - (5,529) (2,357) (168) (8,054)
Transfer between reserves* - - - (2,385) 4,069 (1,684) - -
Transactions with owners
Issue of new shares 1,861 - 17,837 - - - - 19,698
Share issue costs - - (1,016) - - - - (1,016)
Purchase of own shares (62) 62 - (603) - - - (603)
Dividends paid - - - - - (3,283) - (3,283)
At 31 March 2024 12,146 62 25,510 62,190 25,886 (6,471) (2,269) 117,054
For the year ended 31 March 2025
At 1 April 2024
Total comprehensive income - - - - (10,622) 2,715 399 (7,508)
Transfer between reserves* - - - (5,017) 2,742 2,275 - -
Transactions with owners
Issue of new shares 1,664 - 14,660 - - - - 16,324
Share issue costs - - (617) - - - - (617)
Purchase of own shares (52) 52 - (473) - - - (473)
Dividends paid - - - (6,548) - - (6,548)
At 31 March 2025 13,758 114 39,553 50,152 18,006 (1,481) (1,870) 118,232
* A transfer of £2.7 million (2024: £4.1 million), representing impairment
losses during the year, as well as cumulative unrealised gains on investments
which were disposed of during the year has been made from the Capital reserve
- unrealised to the Capital Reserve - realised. A transfer of £5.0 million
(2024: £2.4 million), representing realised losses on investment disposals
plus capital expenses in the year, has been made from Capital Reserve -
realised to the Special reserve.
Included within these reserves is an amount of (£7,340,000) (2024:
(£6,823,000) which is considered distributable to Shareholders under
Companies Act rules. The Income Taxes Act 2007 restricts distribution of
capital from reserves created by the conversion of the share premium account
into a special distributable reserve until the third anniversary of the share
allotment that led to the creation of that part of the share premium account.
As at 31 March 2025, £6,745,000 of the special reserve is distributable under
this restriction.
STATEMENT OF CASH FLOWS for the year ended 31 March 2025
31 March 31 March
2025 2024
£'000 £'000
Cash flow from operating activities
Investment income received 1,660 876
Investment management fees paid (2,499) (2,554)
Other cash payments (639) (463)
Net cash outflow utilised in operating activities (1,478) (2,141)
Cash flow from investing activities
Purchase of investments (11,213) (16,376)
Proceeds from disposal of investments 11,011 29
Net cash outflow utilised in investing activities (202) (16,347)
Cash flow from financing activities
Equity dividends paid (6,133) (3,098)
Proceeds from share issue 15,909 19,513
Share issue costs (537) (1,067)
Purchase of own shares (473) (603)
Net cash inflow generated from financing activities 8,766 14,745
Increase/(decrease) in cash and cash equivalents 7,086 (3,743)
Cash and cash equivalents at start of year 25,102 28,845
Cash and cash equivalents at end of year 32,188 25,102
Total cash and cash equivalents 32,188 25,102
NOTES
1. Accounting policies
General information
Molten Ventures VCT plc ("the Company") is a venture capital trust established
under the legislation introduced in the Finance Act 1995 and is domiciled in
the United Kingdom and incorporated in England and Wales. The Company is a
premium listed entity on the London Stock Exchange.
Basis of accounting
The Company has prepared its financial statements in accordance with the
Financial Reporting Standard 102 ("FRS 102") and in accordance with the
Statement of Recommended Practice "Financial Statements of Investment Trust
Companies and Venture Capital Trusts" issued in July 2022 ("SORP") and with
the Companies Act 2006.
Going concern
After reviewing the Company's forecasts and projections, the Directors have a
reasonable expectation that the major cash outflows of the Company (most
notably investments, share buybacks and dividends) are within the Company's
control and therefore the Company has sufficient cash to meet its expenses and
liabilities when they fall due. The impact of ongoing conflicts, political
changes and the cost of living have been considered, more detail on these
considerations can be found within the Corporate Governance report. As such,
the Board confirms that the Company has adequate resources to continues in
operational existence for at least 12 months from the date of approval of the
financial statements. The Company therefore continues to adopt the going
concern basis in preparing its financial statements as noted further within
the Corporate Governance report on page 40 of the Annual Report.
Presentation of Income Statement
In order to better reflect the activities of a Venture Capital Trust, and in
accordance with the SORP, supplementary information which analyses the Income
Statement between items of a revenue and capital nature has been presented
alongside the Income Statement. The net revenue is the measure the Directors
believe appropriate in assessing the Company's compliance with certain
requirements set out in Part 6 of the Income Tax Act 2007.
Investments
Investments are designated as "fair value through profit or loss" assets, upon
acquisition, due to investments being managed and performance evaluated on a
fair value basis. A financial asset is designated within this category if it
is both acquired and managed, with a view to selling after a period of time,
in accordance with the Company's documented Investment Policy.
Listed fixed income investments and investments quoted on AIM and the Main
Market are measured using bid prices in accordance with the International
Private Equity and Venture Capital Valuation Guidelines ("IPEV").
For unquoted instruments, fair value is established using the IPEV. The
valuation methodologies for unquoted entities used by the IPEV to ascertain
the fair value of an investment are as follows:
· Multiples;
· Industry valuation benchmarks;
· Discounted cash flows or earnings (of underlying business);
· Discounted cash flows (from the investment);
· Net assets; and
· Calibrating to the price of a recent investment.
The methodology applied takes account of the nature, facts and circumstances
of the individual investment and uses reasonable data, market inputs,
assumptions and estimates in order to ascertain fair value as explained in the
investment accounting policy above and addressed further in note 9 of the
Annual Report.
Where an investee company has gone into receivership, liquidation, or
administration (where there is little likelihood of recovery), the loss on the
investment, although not physically disposed of, is treated as being realised.
Permanent impairments in the value of investments are deemed to be realised
losses and held within the Capital Reserve - Realised.
Gains and losses arising from changes in fair value are included in the Income
Statement for the period as a capital item and transaction costs on
acquisition or disposal of the investment expensed.
It is not the Company's policy to exercise significant influence over investee
companies. Therefore, the results of these companies are not incorporated in
the Income Statement, except to the extent of any income accrued. This is in
accordance with the SORP and FRS 102 sections 14 and 15 that do not require
portfolio investments to be accounted for using the equity method of
accounting.
Calibration to price of recent investment requires a level of judgment to be
applied in assessing and reviewing any additional information available since
the last investment date. The Board and Investment Manager consider a range
of factors in order to determine if there is any indication of decline in
value or evidence of increase in value since the recent investment date. If
no such indications are noted the price of the recent investment will be used
as the fair value for the investment.
Examples of signals which could indicate a movement in value are: -
Changes in results against budget or in expectations of achievement of
technical milestones patents/testing/ regulatory approvals.
Significant changes in the market of the products or in the economic
environment in which it operates.
Significant changes in the performance of comparable companies.
Internal matters such as fraud, litigation or management structure.
In respect of disclosures required by the SORP for the 10 largest investments
held by the Company, the most recent publicly available accounts information,
either as filed at Companies House, or announced to the London Stock Exchange,
is disclosed. In the case of unlisted investments, this may be abbreviated
information only.
Judgement in applying accounting policies and key sources of estimation
uncertainty
The key estimates in the financial statements is the determination of the fair
value of the unquoted investments by the Directors as it impacts the valuation
of the unquoted investments at the year end date.
Of the Company's assets measured at fair value, it is possible to determine
their fair values within a reasonable range of estimates. The fair value of an
investment upon acquisition is deemed to be cost. Thereafter, investments are
measured at fair value in accordance with FRS 102 sections 11 and 12, together
with the IPEV.
A price sensitivity analysis of the unquoted investments is provided in note
15 of the Annual Report, under Investment price risk.
Income
Dividend income from investments is recognised when the Shareholders' rights
to receive payment have been established, normally the ex-dividend date.
Interest income is accrued on a timely basis, by reference to the principal
outstanding and at the effective interest rate applicable and only where there
is reasonable certainty of collection. Where previously accrued income is
considered irrecoverable a corresponding bad debt expense is recognised.
Expenses
All expenses are accounted for on an accruals basis. In respect of the
analysis between revenue and capital items presented within the Income
Statement, all expenses have been presented as revenue items except as
follows:
· Expenses which are incidental to the acquisition of an investment are
deducted as a capital item.
· Expenses which are incidental to the disposal of an investment are
deducted from the disposal proceeds of the investment.
· Expenses are split and presented partly as capital items where a
connection with the maintenance or enhancement of the value of the investments
held can be demonstrated. The Company has adopted the policy of allocating
investment manager's fees, 75% to capital and 25% to revenue as permitted by
the SORP. The allocation is in line with the Board's expectation of long term
returns from the Company's investments in the form of capital gains and income
respectively.
· Performance incentive fees arising, if any, are treated as a capital
item.
Taxation
The tax effects on different items in the Income Statement are allocated
between capital and revenue on the same basis as the particular item to which
they relate using the Company's effective rate of tax for the accounting
period.
Due to the Company's status as a Venture Capital Trust and the continued
intention to meet the conditions required to comply with Part 6 of the Income
Tax Act 2007, no provision for taxation is required in respect of any realised
or unrealised appreciation of the Company's investments which arise.
Deferred taxation is not discounted and is provided in full on timing
differences that result in an obligation at the balance sheet date to pay more
tax, or a right to pay less tax, at a future date, at rates expected to apply
when they crystallise based on current tax rates and law. Timing differences
arise from the inclusion of items of income and expenditure in taxation
computations in periods different from those in which they are included in the
accounts.
A deferred tax asset is only recognised to the extent that it is probable
there will be taxable profits in the future against which the asset can be
offset.
Other debtors and other creditors
Other debtors (including accrued income) and other creditors are included
within the accounts at amortised cost.
Cash and cash equivalents
Cash and cash equivalents include cash in hand and deposits held at call with
an original maturity of three months or less. This includes £14.7 million in
the JP Morgan GBP Liquidity NAV Fund and £15.2 million in the Blackrock ICS
Sterling Liquidity Fund.
Dividends
Dividends payable are recognised as distributions in the financial statements
when the Company's liability to make payment has been established, typically
when approved by Shareholders at the AGM or, for interim dividends, the
payment date.
Issue costs
Issue costs in relation to the shares issued are deducted from the special
reserve.
Reportable segments
The Company has one reportable segment as the sole activity of the Company is
to operate as a VCT and all of the Company's resources are allocated to this
activity.
2. Basic and diluted return per share
Year to Year to
31 March 31 March
2025 2024
Basic and diluted loss per share (2.8p) (3.3p)
Return per share based on:
Net revenue loss for the financial year (£'000) 399 (168)
Net capital loss for the financial year (£'000) (7,907) (7,886)
Total losses or the financial year (£'000) (7,508) (8,054)
Weighted average number of shares in issue 272,774,180 242,863,047
As the Company has not issued any convertible securities or share options,
there is no dilutive effect on return per share. The return per share
disclosed, therefore, represents both basic and diluted return per share.
3. Basic and diluted net asset value per share
31 March 2025 31 March 2024
Number in issue as at 31 March Net asset value Net asset value
2025 Pence Pence
2024 per share £'000 per share £'000
Ordinary Shares 275,169,959 242,913,196 43.0 118,232 48.2 117,054
As the Company has not issued any convertible securities or share options,
there is no dilutive effect on net asset value per share. The net asset value
per share disclosed therefore represents both basic and diluted net asset
value per share.
4. Principal Risks
The Company's investment activities expose the Company to a number of risks
associated with financial instruments and the sectors in which the Company
invests. The principal financial risks arising from the Company's operations
are:
· Market risks;
· Credit risk; and
· Liquidity risk.
The Board regularly reviews these risks and the policies in place for managing
them. There have been no significant changes to the nature of the risks that
the Company is exposed to over the year and there have also been no
significant changes to the policies for managing those risks during the year.
The risk management policies used by the Company in respect of the principal
financial risks and a review of the financial instruments held at the year-end
are provided below.
Market risks
As a VCT, the Company is exposed to investment risks in the form of potential
losses that may arise on the investments it holds in accordance with its
Investment Policy. The management of these investment risks is a fundamental
part of investment activities undertaken by the Investment Manager and
overseen by the Board. The Manager monitors investments through regular
contact with management of investee companies, regular review of management
accounts and other financial information and attendance at investee company
board meetings. This enables the Manager to manage the investment risk in
respect of individual investments. Investment risk is also mitigated by
holding a diversified portfolio spread across various business sectors and
asset classes.
The key investment risks to which the Company is exposed are:
· Investment price risk through the uncertain economic environment; and
· Interest rate risk.
The Company has undertaken sensitivity analysis on its financial instruments,
split into the relevant component parts, taking into consideration the
economic climate at the time of review in order to ascertain the appropriate
risk allocation.
Investment price risk
Investment price risk arises from uncertainty about the future prices and
valuations of financial instruments held in accordance with the Company's
investment objectives. It represents the potential loss that the Company might
suffer through investment price movements in respect of quoted investments,
and changes in the fair value of unquoted investments that it holds.
Interest rate risk
The Company accepts exposure to interest rate risk on floating-rate financial
assets through the effect of changes in prevailing interest rates. The Company
receives interest on its cash deposits at a rate agreed with its bankers and
on liquidity funds at rates based on the underlying investments. Investments
in loan notes and fixed interest investments attract interest predominately at
fixed rates. A summary of the interest rate profile of the Company's
investments is shown below.
Interest rate risk profile of financial assets and financial liabilities
There are three levels of interest which are attributable to the financial
instruments as follows:
· "Fixed rate" assets represent investments with predetermined yield targets
and comprise fixed interest and loan note investments.
· "Floating rate" assets predominantly bear interest at rates linked to Bank
of England base rate and comprise cash at bank and money market funds.
· "No interest rate" assets do not attract interest and comprise equity
investments, loans and receivables (excluding cash at bank) and other
financial liabilities.
The Company monitors the level of income received from fixed, floating and
non-interest rate assets and, if appropriate, may make adjustments to the
allocation between the categories, in particular, should this be required to
ensure compliance with the VCT regulations.
Credit risk
Credit risk is the risk that a counterparty to a financial instrument is
unable to discharge a commitment to the Company made under that instrument.
The Company is exposed to credit risk through its holdings of loan notes in
investee companies, investments in fixed income securities, cash deposits and
debtors.
The Manager manages credit risk in respect of loan notes with a similar
approach as described under interest rate risk above. In addition, the credit
risk is partially mitigated by registering floating charges over the assets of
certain investee companies. The strength of this security in each case is
dependent on the nature of the investee company's business and its
identifiable assets. The level of security is a key means of managing credit
risk. Similarly, the management of credit risk associated interest, dividends
and other receivables is covered within the investment management procedures.
Cash of £2.3 million is held at Bank of Scotland plc, which is an A-rated
financial institution. In addition, the Company holds £29.9 million in money
market funds. Consequently, the Directors consider that the risk profile
associated with cash deposits is low.
Liquidity risk
Liquidity risk is the risk that the Company encounters difficulties in meeting
obligations associated with its financial liabilities. Liquidity risk may also
arise from either the inability to sell financial instruments when required at
their fair values or from the inability to generate cash inflows as required.
The Company normally has a relatively low level of creditors (31 March 2025:
£168,000, 31 March 2024: £182,000) and has no borrowings. The Company always
holds sufficient levels of funds as cash and readily realisable investments in
order to meet expenses and other cash outflows as they arise. For these
reasons, the Board believes that the Company's exposure to liquidity risk is
minimal.
The Company's liquidity risk is managed by the Investment Manager, in line
with guidance agreed with the Board and is reviewed by the Board at regular
intervals.
5. Transactions with related parties and Investment Manager
Richard Marsh is an employee of Molten Ventures plc, the parent company of
Elderstreet Investments Limited. Elderstreet Investments Limited provided
investment management services to the Company. During the year, £2.5 million
(2024: £2.5 million) was due in respect of these services. No performance
incentive fees were paid to Elderstreet Investments Limited in respect of the
year under review (2024: £nil). As at 31 March 2025, £nil (2024: £27,000)
was outstanding and payable.
6. Events after the end of the reporting period
On 1 April 2025, the Company received proceeds of £1,142,000 from the sale of
Freetrade Limited to IG Group Holdings plc, an online trading provider.
On 4 April 2025, the Company allotted 15,292,988 Ordinary Shares of 5p each at
an average price of 43.0p per Ordinary Share under the terms of the Offer for
Subscription dated 11 October 2024.
On 16 April 2025, the Company allotted 278,213 Ordinary Shares of 5p each at
an average price of 42.6p per Ordinary Share under the terms of the Offer for
Subscription dated 11 October 2024.
The Company also allotted 438,011 Ordinary Shares of 5p each in respect of
Shareholders who agreed to subscribe for shares under the terms of the
Company's Dividend Reinvestment Scheme ("DRIS") in respect of the dividend of
1p per Ordinary Share paid on 25 April 2025. The shares were issued at 41.7p
per share (being the latest published unaudited adjusted net asset value).
On 29 April 2025, the Company bought back 9,344,254 of its own Ordinary Shares
at a price 39.8p per share. These shares were subsequently cancelled.
The issued share capital and total voting rights of the Company is now
281,790,917 Ordinary Shares
ANNOUNCEMENT BASED ON AUDITED ACCOUNTS
The financial information set out in this announcement does not constitute the
Company's statutory financial statements in accordance with section 434
Companies Act 2006 for the year ended 31 March 2025 but has been extracted
from the statutory financial statements for the year ended 31 March 2025 which
were approved by the Board of Directors on 18 June 2025 and will be delivered
to the Registrar of Companies. The Independent Auditor's Report on those
financial statements was unqualified and did not contain any emphasis of
matter nor statements under s498(2) and (3) of the Companies Act 2006.
The statutory accounts for the year ended 31 March 2024 have been delivered to
the Registrar of Companies and received an Independent Auditors report which
was unqualified and did not contain any emphasis of matter nor statements
under s498(2) and (3) of the Companies Act 2006.
A copy of the full annual report and financial statements for the year ended
31 March 2025 will be printed and posted/emailed to shareholders shortly.
Copies will also be available to the public at the registered office of the
Company at The Office Suite, Den House, Den Promenade, Teignmouth TQ14 8SY and
will be available for download from
https://investors.moltenventures.com/investor-relations/vct
(https://investors.moltenventures.com/investor-relations/vct) .
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