Maven Inc&Grwth 5 - Annual Financial Report
10/03/2022 16:57
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RNS Number : 4103E Maven Income and Growth VCT 5 PLC 10 March 2022
Maven Income and Growth VCT 5 PLC
Final results for the year ended 30 November 2021
The Directors report the Company's financial results for the year ended 30
November 2021.
Highlights
• NAV total return at the year end of 84.64p per share (2020:
79.83p)
• NAV at the year end of 38.99p per share (2020: 36.38p), after
total dividend payments of 2.20p per share during the year
• Interim dividend of 0.60p per share paid on 10 September 2021
• Second interim dividend of 0.50p per share paid on 26 November
2021
• Final dividend of 1.00p per share proposed for payment on 4 May
2022
• Offer for Subscription fully subscribed, raising £20 million
Strategic Report
Chairman's Statement
On behalf of your Board, I am pleased to report on the progress that has been
achieved during the year to 30 November 2021. Despite the ongoing uncertainty
in relation to the pandemic, your Company has continued to deliver its
investment objective and is reporting an increase in NAV total return to
84.64p per share and a higher level of Shareholder distributions. The
Directors are encouraged by the progress that has been achieved across the
portfolio, with several private companies achieving good commercial traction,
resulting in uplifts to valuations, whilst the AIM quoted portfolio delivered
another strong performance. In addition to three profitable private company
realisations, GENinCode was successfully floated on AIM, achieving a 2.7x
uplift in value at the time of listing. Shortly after the period end, your
Company completed its most significant exit to date from the growth portfolio
with the sale of Quorum Cyber, which generated a total return on cost of 6.5x
inclusive of a retained minority interest.
Overview
During the financial year, the economy continued to be impacted by the
pandemic as a second wave of the virus resulted in the re-introduction of
protective measures in January 2021. Whilst the success of the UK wide
vaccination programme facilitated the gradual easing of lockdown restrictions
from late spring onwards, and there was a resurgence in economic activity, the
more recent emergence of the Omicron variant has demonstrated that the virus
has the potential to destabilise the economy during the year ahead.
It is, however, encouraging to report on the progress that has been achieved
during the period under review. A notable highlight was the completion of the
£20 million fundraising, which closed early fully subscribed. This new
capital provides your Company with sufficient liquidity to continue to
carefully expand and develop the portfolio in line with the strategic
objective of building a large and diversified portfolio of private and AIM
quoted companies that are capable of achieving scale and generating a capital
gain on exit. During the year, the Manager continued to see good levels of
demand for capital from ambitious younger companies and added 22 new private
companies and AIM quoted holdings to the portfolio. It is anticipated that
further new investments will be made during the year ahead, alongside the
provision of follow-on funding to support existing portfolio companies that
are making commercial progress and require additional capital to achieve their
business plan and maximise value.
Since the VCT rules changed in 2015, the Manager has been carefully
constructing a diverse portfolio of high growth private and AIM quoted
companies that meet the revised VCT qualification criteria. The Directors are
pleased to note that many of these earlier stage companies are now achieving
scale and delivering their strategic and commercial growth objectives. In
certain cases, this has required the business model to pivot in response to a
fundamental shift in market dynamics, or to meet an emerging opportunity.
Across the portfolio, there are examples of investee companies that have
delivered an improvement in performance, often measured in terms of growth in
contracted recurring revenue, and this has resulted in uplifts to several
valuations to reflect the growth achieved. Your Company also benefits from a
portfolio of later stage investments, completed prior to the change in VCT
rules, and these more mature holdings remain a core component of the
portfolio, helping to counterbalance the increased level of risk associated
with investment in earlier stage companies.
The AIM quoted portfolio delivered another positive performance during the
year, recording a total gain of £4.26 million. The Directors continue to
believe that investments in AIM offer exposure to a wider range of growth
companies, often with more favourable liquidity characteristics, and it is
anticipated that further selective new investments will be made during the
coming year. The Directors will also seek, where possible, to partially
realise some of the larger holdings that have grown significantly in value
over recent years, and where it is appropriate to reduce the overall exposure.
During the period, private company GENinCode successfully floated on AIM,
generating an uplift in value of 2.7x cost at the time of IPO, over a holding
period of approximately one year. The objective to achieve a market listing
was quickly identified as a key target for GENinCode that would help
accelerate the future growth and development of the business. Maven's AIM team
played a key role in completing this transaction and that capability provides
an alternative exit strategy for certain private companies.
In line with the increase in market activity across the UK, there has also
been a resurgence in exit activity, which has resulted in profitable
realisations of the holdings in Curo Compensation, eSafe and Mojo Mortgages,
generating total returns on cost of 1.1x, 1.4x and up to 1.8x respectively.
Post the period end, your Company achieved its most significant return to date
from the growth portfolio with the realisation of the holding in Quorum Cyber,
which achieved a total return of 6.5x cost inclusive of a retained minority
holding in the business. This successful realisation demonstrates the ability
of certain early stage companies to generate meaningful growth in Shareholder
value over a relatively short period of time. Although the timing of exits is
often hard to predict, based on the progress achieved across the portfolio the
Directors are optimistic that further profitable exits can be achieved in the
coming years to help support dividend payments.
Full details of the portfolio developments, including new investments and
realisations, can be found in the Investment Manager's Review in the Annual
Report.
COVID-19
The pandemic has remained a dominant feature of the financial year, and,
whilst the success of the vaccination programme has enabled most restrictions
to be lifted, the emergence of the Omicron variant in late 2021 was a timely
reminder that the virus has the potential to cause further disruption during
the year ahead.
Historically, your Company has maintained a relatively low level of direct
exposure to consumer facing sectors, such as retail, leisure, travel,
hospitality and entertainment, which were most severely impacted by the
pandemic. The Manager's focus on investing in dynamic businesses with strong,
often counter-cyclical, growth characteristics has proven to be a sound
strategy, that has helped partially to insulate the portfolio from the
disruption caused by the pandemic. It is also encouraging that several
investee companies, specifically those that are active in the biotech or
medtech space, have contributed towards the UK's efforts to tackle COVID-19,
including developing testing and therapeutics, or manufacturing medical
products or devices.
Throughout the period, the Manager has adhered to all Government and local
guidelines, with its regional offices and administration hub moving to a
remote working model in March 2020. During this period, full operational
capability has been maintained and there has been no impact on the management
or running of your Company. The Maven offices have now fully re-opened and it
is anticipated that 2022 will see a return to a normalised office based
working pattern.
Until recently, all Board Meetings were conducted via Microsoft Teams, which
has proven to be an effective medium. However, face to face Meetings have now
resumed and, subject to any changes in Government guidance, will continue to
follow the traditional in person format. It is also intended that the 2022 AGM
will take place in person, full details of which can be found in the Notice of
Annual General Meeting in the Annual Report.
Brexit
The UK formally left the EU on 31 January 2020 and entered into an
eleven-month transition period that ended on 31 December 2020, with the EU
(Future Relationship) Act 2020 coming into effect on 1 January 2021.
The Manager had been working closely with portfolio companies, both prior to
and during the transition period, in order to help identify any potential
issues and to put in place contingency measures to mitigate against perceived
problems, such as supply chain disruption or staffing shortages. Furthermore,
whilst the majority of the investee companies have limited direct exposure to
the EU, there have been no significant indirect issues of note beyond the
general market uncertainty that have affected the wider UK economy.
There is now greater clarity on the impact of Brexit and, whilst it is likely
that there will be issues that affect the economy in general, the Directors
are comfortable that the sectoral diversity of the portfolio, as well as its
UK focus, should ensure that your Company is well positioned to benefit from
future investment in the economy.
Registration Services
Following a review of registration and receiving agency services provided by a
number of suppliers and after undertaking extensive due diligence on its
service features and operations, The City Partnership (UK) Limited (City
Partnership) has been appointed as the Registrar to your Company and the other
Maven managed VCTs and is also acting as Receiving Agent for the current joint
Offers for Subscription by Maven Income and Growth VCT 3 PLC and Maven Income
and Growth VCT 4 PLC.
City Partnership's appointment became effective on 25 October 2021 and
Shareholders should have received a welcome letter from the new Registrar,
including an invitation to register for its investor hub at
maven-cp.cityhub.uk.com/login (https://maven-cp.cityhub.uk.com/login) . A
separate enclosure from City Partnership, detailing the benefits of using the
investor hub and how to register, is included with the Annual Report.
To date, the Board and the Manager are encouraged by the performance and
service provided by City Partnership, both in terms of the management of the
share register and activities relating to the current Offers.
Dividend Policy
Decisions on distributions take into consideration a number of factors,
including the realisation of capital gains, the adequacy of distributable
reserves, the availability of surplus revenue and the VCT qualifying level,
all of which are kept under close and regular review.
The Board and the Manager recognise the importance of tax-free distributions
to Shareholders and, subject to the considerations outlined above, will seek,
as a guide, to pay an annual dividend which represents 5% of the NAV per share
at the immediately preceding year end. It should be noted that the effect of
paying a dividend is to reduce the NAV of the Company by the total cost of the
distribution.
The Directors would like to remind Shareholders that, as the portfolio
continues to expand and a greater proportion of holdings are invested in early
stage companies, the timing of distributions will be more closely linked to
realisation activity, whilst also reflecting the Company's requirement to
maintain its VCT qualifying level. If larger distributions are required as a
consequence of significant exits, this will result in a corresponding
reduction in NAV per share. However, your Board considers this to be a tax
efficient means of returning value to Shareholders, whilst ensuring ongoing
compliance with the requirements of the VCT legislation.
Proposed Final Dividend
In light of the recent realisation activity, your Board was pleased to declare
a second interim dividend of 0.50p per Ordinary Share in respect of the year
ended 30 November 2021, which was paid on 26 November 2021.
Furthermore, your Board is proposing a final dividend of 1.00p per Ordinary
Share in respect of the year ended 30 November 2021, which will be paid on 4
May 2022 to Shareholders on the register at 1 April 2022. This will bring
total distributions for the financial year to 2.10p per Ordinary Share,
representing a yield of 5.77% based on the NAV at the preceding year end of
36.38p per share. Since the Company's launch, and after receipt of the
proposed final dividend, Shareholders will have received 46.65p per share in
tax-free distributions.
Dividend Investment Scheme (DIS)
The Directors would like to remind Shareholders that your Company operates a
DIS, through which dividend payments can be utilised to subscribe for new
Ordinary Shares issued by the Company under the standing authority requested
from Shareholders at Annual General Meetings. Shares issued under the DIS
should qualify for VCT tax relief applicable for the tax year in which they
are allotted, subject to an individual Shareholder's particular circumstances.
Shareholders can elect to participate in the DIS in respect of future
dividends, including the payment of the proposed final dividend, to be paid on
4 May 2022, by completing a DIS mandate, which must be received by the new
Registrar (City Partnership) before 19 April 2022, this being the next
dividend election date. The mandate form, terms & conditions and full
details of the scheme (including further details about tax considerations) are
available from the Company's website at www.mavencp.com/migvct5
(http://www.mavencp.com/migvct5) . Election to participate in the DIS can also
be made through the Registrar's investor hub at maven-cp.cityhub.uk.com/login
(https://maven-cp.cityhub.uk.com/login) .
If a Shareholder is in any doubt about the merits of participating in the DIS,
or their own tax status, they should seek advice from a suitably qualified
adviser.
Fund Raising and Allotment
On 23 October 2020, your Company, together with Maven Income and Growth VCT
PLC, launched joint Offers for Subscription in new Ordinary Shares for up to
£20 million in aggregate (£10 million for each company), with a combined
over-allotment facility of up to £20 million (£10 million for each company).
On 30 March 2021, the Directors were pleased to announce that your Company's
Offer was fully subscribed, including full utilisation of the over-allotment
facility.
An allotment of 24,921,994 new Ordinary Shares in respect of the 2020/21 tax
year completed on 2 March 2021, with a further 26,817,537 new Ordinary Shares
allotted on 1 April 2021. The allotment of 2,071,074 Ordinary Shares for the
2021/22 tax year took place on 4 May 2021.
This additional liquidity will enable your Company to continue to expand the
portfolio by investing in ambitious, growth focused private and AIM quoted
companies that operate across a broad range of market sectors, and are capable
of generating capital gains. It will also ensure that existing portfolio
companies can continue to be supported through follow-on funding where there
is an ongoing business case which merits support. Furthermore, the funds
raised will allow your Company to maintain its share buy-back policy, whilst
also spreading costs over a wider asset base in line with the objective of
maintaining a competitive total expense ratio for the benefit of all
Shareholders.
Share Buy-backs
Shareholders will be aware that a primary objective for the Board is to ensure
that the Company retains sufficient liquidity for making investments in line
with its stated policy, and for the continued payment of dividends. However,
the Directors also acknowledge the need to maintain an orderly market in the
Company's shares and have, therefore, delegated authority to the Manager to
buy back shares in the market for cancellation or to be held in treasury,
subject always to such transactions being in the best interests of
Shareholders.
As announced on 9 February 2022, the Directors reviewed the Company's share
buy-back policy and the discount range of between 10% to 15% to the prevailing
NAV per share, at which shares would be bought back. Following that review,
and subject to market conditions, available liquidity and the maintenance of
the Company's VCT status, it is now intended that shares will be bought back
at prices that will maintain a discount of between 5% and 10% to the
prevailing NAV per share.
Investment Management Agreement (IMA)
Following the recent growth in the size of the Company, from an NAV of £30
million in 2015 to over £68 million at the current year end, and given the
increased level of complexity across the portfolio, the Board has agreed a
modest adjustment to the annual administration and performance related
incentive fees payable to the Manager. The Board is satisfied that these new
fee arrangements remain competitive and provide a more suitable incentive
structure for the Manager of a hybrid private equity and AIM VCT, whilst
remaining closely aligned with Shareholders' interests. Further details on the
fee arrangements can be found in the Directors' Report in the Annual Report.
VCT Regulatory Developments
During the period under review, there have been no further amendments to the
rules governing VCTs. The Autumn Budget was delivered on 27 October 2021 and
did not propose any changes to the legislation governing VCTs.
The Directors and the Manager continue to apply the International Private
Equity and Venture Capital Valuation (IPEV) Guidelines as the central
methodology for all private company valuations. The IPEV Guidelines are the
prevailing framework for fair value information in the private equity and
venture capital industry.
Environmental, Social and Governance (ESG)
The Board is cognisant of the importance of ESG principles, and believes that
each portfolio company should behave responsibly towards the environment and
society, whilst operating in line with governance best practice. The Directors
are pleased to report that the Manager has increased its focus on ESG and has
integrated these criteria into its investment appraisal process. Additionally,
a robust framework has been developed to ensure that ESG considerations are
monitored and managed carefully throughout the period of investment.
In May 2021, the Manager became a signatory to the internationally recognised
Principles for Responsible Investment, demonstrating its commitment to include
ESG as an integral part of its investment decision making and ownership. The
Manager has also become a signatory to the Investing in Women Code, which aims
to improve female entrepreneurs' access to tools, resources and finance,
supporting diversity and inclusion in access to finance.
While neither the Company nor the Manager are currently required to disclose
climate related financial information in line with the Task Force on Climate
related Financial Disclosures (TCFD), they recognise the aim and importance of
the TCFD recommendations to provide a foundation to improve investors' ability
to appropriately assess climate-related risk and opportunities. Disclosing
information against the TCFD recommendations remains an objective of the
Manager as part of their ESG initiatives and progress will be monitored by the
Directors.
Maven Capital Partners LLP (Maven)
As noted in the 2021 Interim Report, Mattioli Woods plc formally completed the
acquisition of Maven on 1 July 2021. The Directors are pleased to confirm
that, following this strategic development, there has been no material change
to the management of your Company. As previously outlined, Maven now operates
as an independently managed subsidiary of Mattioli Woods, retaining its
regional business model, people and brand in entirety, with no direct impact
for Maven's VCT clients, Shareholders or investee companies. Your Board
considers this to be a positive step in the evolution of Maven and does not
anticipate any significant operational changes. Bill Nixon remains Managing
Partner and lead VCT fund manager, and the investment team and support staff
providing company secretarial, accounting and administrative services, are all
continuing to operate as before.
Mattioli Woods is one of the UK's leading providers of wealth management and
financial planning services and Maven offers a highly complementary fit with
its existing operations. Maven and Mattioli Woods share a common objective of
continuing to expand the enlarged business under PLC ownership. Both
businesses are well known to each other, and there is strong cultural
alignment, as well as a common focus on providing clients with the best
possible service. Further details on Mattioli Woods can be found at
www.mattioliwoods.com (http://www.mattioliwoods.com) .
Annual General Meeting (AGM)
The Directors are pleased to confirm that, subject to no variation in the
guidelines in relation to the pandemic, the 2022 AGM will be held in the
London office of Maven Capital Partners UK LLP on 26 April 2022, commencing at
11:30am. The Notice of Annual General Meeting can be found in the Annual
Report.
Ukraine
As at the date of the publication of this Annual Report, global attention has
become focused on the evolving situation in Ukraine and the significant
humanitarian issues that are unfolding. Whilst the economic impact of these
developments is not yet fully known, it is likely that financial markets and
commodity prices will experience some volatility over the coming period. The
Board and the Manager will continue to monitor the situation closely and
remain hopeful that a swift and peaceful resolution can be achieved.
The Future
At the time of writing, the UK is beginning to see a reduction in the impact
of the COVID-19 pandemic. Assuming this trend in public health is maintained,
it is anticipated that, notwithstanding the unfolding issues in Ukraine,
strong economic growth will feature during 2022, although this may be tempered
in part by inflationary pressures. Following the uncertainty associated with
Brexit there are positive trends evident around M&A activity, which is
expected to see a latent demand for high growth UK companies, similar to those
held by your Company. These market trends augur well for the immediate future.
Graham Miller
Chairman
10 March 2022
Business Report
This Business Report is intended to provide an overview of the strategy and
business model of the Company, as well as the key measures used by the
Directors in overseeing its management. The Company is a venture capital trust
and invests in accordance with the investment objective set out below.
Investment Objective
The Company aims to achieve long-term capital appreciation and generate income
for Shareholders. Maven Capital Partners UK LLP (Maven or the Manager) was
appointed in February 2011 with a view to applying a new investment policy, as
set out below.
Business Model and Investment Policy
Under an investment policy approved by the Directors, the Company intends to
achieve its objective by:
• investing the majority of its funds in a diversified
portfolio of shares and securities in smaller, unquoted UK companies and
AIM/AQSE quoted companies which meet the criteria for VCT qualifying
investments and have strong growth potential;
• investing no more than £1.25 million in any company in one
year and no more than 15% of the Company's assets by cost in one business at
any time; and
• borrowing up to 15% of net asset value, if required and only
on a selective basis, in pursuit of its investment strategy. The Board has no
intention of approving any borrowing at this time.
Principal and Emerging Risks and Uncertainties
The Board and the Risk Committee have an ongoing process for identifying,
evaluating and monitoring the principal and emerging risks and uncertainties
facing the Company. The risk register and risk dashboard form key parts of the
Company's risk management framework used to carry out a robust assessment of
the risks, including a significant focus on the controls in place to mitigate
them.
The current principal and emerging risks and uncertainties facing the Company
are considered to be as follows:
Investment Risk
The majority of the Company's investments are in early stage, small and medium
sized unquoted UK companies and AIM/AQSE quoted companies which, by their
nature, carry a higher level of risk and lower liquidity than investments in
large quoted companies. The Board aims to limit the risk attached to the
investment portfolio as a whole by ensuring that a robust and structured
selection, monitoring and realisation process is applied. The Board reviews
the investment portfolio with the Manager on a regular basis.
The Company manages and minimises investment risk by:
• diversifying across a large number of companies;
• diversifying across a range of economic sectors;
• actively and closely monitoring the progress of investee
companies;
• co-investing with other clients of Maven, other VCT
managers, and/or other co-investor partners;
• ensuring valuations of underlying investments are made fairly
and reasonably (see Notes to the Financial Statements 1(e), 1(f) and 16 for
further details);
• taking steps to ensure that the share price discount is
managed appropriately; and
• choosing and appointing an FCA authorised investment manager with
the appropriate skills, experience and resources required to achieve the
Investment Objective above, with ongoing monitoring to ensure the Manager is
performing in line with expectations.
Operational Risk
The Board has been aware of the heightened cyber security risk and potential
consequences of IT failure during the pandemic, particularly in relation to
the reliance on remote working practices by the Manager and key third parties
during this period. The Board has closely monitored the systems and controls
in place to prevent or mitigate against a systems or data security failure and
the overall effectiveness of business continuity arrangements of the Manager
and third parties. The failure of a significant outsourcer resulting in an
inability to provide services to the Company or Shareholders and the risk of
misappropriation of funds or assets belonging to the Company are considered to
be ongoing operational risks. These are mitigated by robust systems and
controls, which include close and careful oversight by the Manager and the
Board.
VCT Qualifying Status Risk
The Company operates in a complex regulatory environment and faces a number of
related risks, including:
• becoming subject to capital gains tax on the sale of its
investments as a result of a breach of Section 274 of the Income Tax Act 2007;
• loss of VCT status and the consequential loss of tax reliefs
available to Shareholders as a result of a breach of the VCT regulations;
• loss of VCT status and reputational damage as a result of a
serious breach of other regulations such as the FCA Listing Rules and the
Companies Act 2006; and
• increased investment restrictions resulting from the EU State
Aid Rules incorporated by the Finance (No. 2) Act 2015 and the Finance Act
2018.
The Board works closely with the Manager to ensure compliance with all
applicable and upcoming legislation such that VCT qualifying status is
maintained. Further information on the management of this risk is detailed
under other headings in this Business Report.
Legislative and Regulatory Risk
The Directors strive to maintain a good understanding of the changing
regulatory agenda and consider emerging issues so that appropriate changes can
be implemented and developed in good time.
In order to maintain its approval as a VCT, the Company is required to comply
with current VCT legislation in the UK as well as the EU State Aid Rules.
Changes to either legislation could have an adverse impact on Shareholder
investment returns, whilst maintaining the Company's VCT status. The Board and
the Manager continue to make representations where appropriate, either
directly or through relevant industry bodies such as the Association of
Investment Companies (AIC), the British Venture Capital Association (BVCA) and
the Venture Capital Trust Association (VCTA).
The Company has retained Philip Hare & Associates LLP as its principal VCT
adviser and also uses the services of a number of other VCT advisers on a
transactional basis.
Breaches of other regulations, including, but not limited to, the Companies
Act 2006, the FCA Listing Rules, the FCA Disclosure Guidance and Transparency
Rules, the General Data Protection Regulation (GDPR), and the Alternative
Investment Fund Managers Directive (the AIFMD), could lead to a number of
detrimental outcomes and reputational damage.
The AIFMD, which regulates the management of alternative investment funds,
including VCTs, introduced a new authorisation and supervisory regime for all
investment companies in the EU. The Company is a small registered, internally
managed alternative investment fund under the AIFMD, and its status as such is
unchanged as a result of the UK's departure from the EU.
The Company is also required to comply with tax legislation under the Foreign
Account Tax Compliance Act and the Common Reporting Standard. The Company has
appointed City Partnership to act on its behalf to report annually to HM
Revenue & Customs (HMRC) and ensure compliance with this legislation.
Climate Change and Social Responsibility Risk
The Board recognises that climate change is an important emerging risk that
all companies should take into consideration within their strategic planning.
As referred to elsewhere in this Strategic Report and in the Statement of
Corporate Governance in this Annual Report, the Company has little direct
impact on environmental issues. However, the Company has introduced measures
to reduce the cost and environmental impact of the production and circulation
of Shareholder documentation such as the Annual and Interim Reports. This has
resulted in a significant reduction in the number of paper copies being
printed and posted, with only 21% of Shareholders now receiving printed
reports.
The Board is aware that the Manager is increasing efforts in relation to the
identification of environmental risks and opportunities and is developing its
ESG policy accordingly. Environmental risk is a fundamental aspect of due
diligence and industry specialists are assigned where there may be specific
concerns in relation to a potential business or sector. The results are then
factored into the decision making process for new investments. VCTs in general
are regarded as supporting small and medium sized enterprises which, in turn,
helps create local employment opportunities across a range of geographical
areas in the UK.
Ukraine
Another emerging risk is the ongoing situation in Ukraine, which the Board is
monitoring closely. Whilst the impact on the Company is unknown, it is
acknowledged that there is an increased cyber security risk. The Manager is
taking steps to mitigate this risk, including the oversight of third
parties.
Other Key Risks
Governance Risk
The Directors are aware that an ineffective Board could have a negative impact
on the Company and its Shareholders. The Board recognises the importance of
effective leadership and board composition, and this is ensured by completing
an annual evaluation process. If required, additional training is then
arranged.
Management Risk
The Directors are aware of the risk that investment opportunities could fail
or the management of the VCT could breach the Management and Administration
Deed or regulatory parameters, due to lack of knowledge and/or experience of
the investment professionals acting on behalf of the Company. To manage this
risk, the Board has appointed Maven as investment manager, as it employs
skilled professionals with the required VCT knowledge and experience. In
addition, the Board takes comfort from the Manager's controls that have been
updated to ensure compliance with the Senior Managers and Certification
Regime.
The Directors are also mindful of the impact that the loss of the Manager's
key employees could have on both investment opportunities that may be lost or
existing investments that may fail. The Board takes reassurance from the
Manager's approach to incentivising staff and ensuring that adequate notice
periods are included in all contracts of employment.
Financial and Liquidity Risk
As most of the investments require a mid to long-term commitment and are
relatively illiquid, the Company retains a portion of the portfolio in cash
and listed investment trusts in order to finance any new or follow-on
investment opportunities. The Company has only limited direct exposure to
currency risk and does not enter into any derivative transactions.
Political Risk
The EU (Future Relationship) Act 2020 came into effect on 1 January 2021 and
the full political, economic and legal consequences of the UK leaving the EU
are not yet known. It is possible that investments in the UK may be more
difficult to value and assess for suitability of risk, harder to buy or sell
and may be subject to greater or more frequent rises and falls in value. In
the longer term, there is likely to be a period of uncertainty as the UK seeks
to negotiate its ongoing relationship with the EU and other global trade
partners. The UK's laws and regulations, including those relating to
investment companies, may, in the future, diverge from those of the EU. This
may lead to changes in the operation of the Company or the rights of investors
in the territories in which the shares of the Company may be promoted and
sold.
The Board reviews regularly the political situation, together with any
associated changes to the economic, regulatory and legislative environment, to
ensure that any risks arising are mitigated as effectively as possible.
Economic Risk
The valuation of investment companies may be affected by underlying economic
conditions such as fluctuating interest rates and the availability of bank
finance, which can be impacted during times of geopolitical uncertainty and
fluctuating markets, including during the coronavirus pandemic. Investee
companies may also be directly impacted by the economic effects of the
pandemic, such as insufficient funds to carry the business through the crisis,
market conditions affecting their valuations, or the risk of lockdown
restrictions limiting the ability to conduct new business or recruitment. The
Manager has provided enhanced support and oversight to investee companies
where needed and in some cases can consider follow-on funding. The diverse
portfolio of the Company has limited the overall impact of the economic
effects of the pandemic. The economic and market environment is kept under
constant review and the investment strategy of the Company is adapted so far
as possible to mitigate emerging risks.
Credit Risk
The Company may hold financial instruments and cash deposits and is dependent
on counterparties discharging their agreed responsibilities. The Directors
consider the creditworthiness of the counterparties to such instruments and
seek to ensure that there is no undue concentration of exposure to any one
party.
An explanation of certain economic and financial risks and how they are
managed is contained in Note 16 to the Financial Statements.
Statement of Compliance with Investment Policy
The Company is adhering to its stated investment policy and managing the risks
arising from it. This can be seen in various tables and charts throughout this
Annual Report, and in the Chairman's Statement and the Investment Manager's
Review. A review of the Company's business, its financial position as at 30
November 2021 and its performance during the year then ended is included in
the Chairman's Statement, which also includes an overview of the Company's
business model and strategy.
The management of the investment portfolio has been delegated to Maven, which
also provides company secretarial, administrative and financial management
services to the Company. The Board is satisfied with the depth and breadth of
the Manager's resources and its nationwide network of offices, which supply
new deals and enable it to monitor the geographically widespread portfolio of
companies effectively.
The Investment Portfolio Summary in the Annual Report discloses the
investments in the portfolio and the degree of co-investment with other
clients of the Manager. The charts in the Portfolio Analysis in the Annual
Report show the profile of the portfolio by industry sector and by value.
These charts also show the hybrid composition of the portfolio and the balance
between growth capital investments, more mature private company investments,
and AIM/AQSE quoted investments. The level of VCT qualifying investment is
monitored continually by the Manager and reported to the Risk Committee
quarterly or as required.
Key Performance Indicators (KPIs)
During the year, the net return on ordinary activities before taxation was
£8,432,000 (2020: £656,000), gains on investments were £9,624,000 (2020:
£1,442,000) and earnings per share were 5.31p (2020: 0.52p). The Directors
also consider a number of Alternative Performance Measures (APMs) in order to
assess the Company's success in achieving its objectives, and these also
enable Shareholders and prospective investors to gain an understanding of its
business. The APMs are shown in the Financial History table in the Annual
Report. In addition, the Board considers the following to be KPIs:
• NAV total return;
• cumulative dividends paid;
• share price discount to NAV;
• share price total return; and
• operational expenses.
The NAV total return is the principal measure of Shareholder value as it
includes both the current NAV per share and the sum of dividends paid to date.
Cumulative dividends paid is the total amount of both capital and income
distributions paid since the launch of the Company. The Directors seek to pay
dividends to provide a yield and comply with the VCT rules, taking account of
the level of distributable reserves, profitable realisations in each
accounting period and the Company's future cash flow projections. The share
price discount to NAV is the percentage by which the mid-market share price of
an investment is lower than the NAV per share. Share price total return is the
percentage movement in the share price over a period of time including any
re-invested dividends paid over that timeframe. A historical record of these
measures is shown in the Financial Highlights in the Annual Report, and the
profile of the portfolio is reflected in the Summary of Investment Changes in
the Annual Report. Definitions of the APMs can be found in the Glossary in the
Annual Report. The Board also reviews the Company's operational expenses on a
quarterly basis as the Directors consider that this element is an important
component in the generation of Shareholder returns. Further information can be
found in Notes 2 and 4 to the Financial Statements in the Annual Report.
The introduction of the Finance (No. 2) Act 2015 altered the type of
investments VCTs can make, and also changed the transaction structure to be
more heavily weighted to equity investment. The proportion of loan notes has
reduced as a result and, accordingly, the Directors agreed that investment
income is not considered to be a KPI. The Directors have also agreed that the
rebalancing of the legacy AIM portfolio should no longer be considered a KPI.
In recent years, AIM has matured and has offered increasingly good investment
opportunities, and your Board has been pleased with the positive contribution
that the AIM portfolio has delivered. Whilst the majority of new investments
will continue to be made in unlisted companies, given the positive
performance, your Company will continue to make selective new AIM investments.
There is no VCT index against which to compare the financial performance of
the Company. However, for reporting to the Board and Shareholders, the Manager
uses comparisons with the most appropriate index, being the FTSE AIM All-Share
Index. The Directors also consider non-financial performance measures such as
the flow of investment proposals and the Company's ranking within the VCT
sector.
In addition, the Directors consider economic, regulatory and political trends
and factors that may impact on the Company's future development and
performance.
Valuation Process
Investments held by Maven Income and Growth VCT 5 PLC in unquoted companies
are valued in accordance with the International Private Equity and Venture
Capital Valuation (IPEV) Guidelines. Investments quoted or traded on a
recognised stock exchange, including AIM, are valued at their bid prices.
Share Buy-backs
At the forthcoming AGM, the Board will seek the necessary Shareholder
authority to continue to conduct share buy-backs under appropriate
circumstances.
The Board's Duty and Stakeholder Engagement
The Directors recognise the importance of an effective Board and its ability
to discuss, review and make decisions to promote the long-term success of the
Company and protect the interests of its key stakeholders. As required by
Provision 5 of the AIC Code (and in line with the UK Code), the Board has
discussed the Directors' duty under Section 172 of the Companies Act and how
the interests of key stakeholders have been considered in the Board
discussions and decision making during the year.
This has been summarised in the table below:
Form of engagement Influence on Board decision making
Shareholders
AGM - Shareholders are encouraged to attend the AGM and are provided with the Dividend declarations - the Board recognises the importance of tax-free
opportunity to ask questions and engage with the Directors and the Manager. dividends to Shareholders and takes this into consideration when making
decisions to pay interim and propose final dividends for each year. Further
Shareholders are also encouraged to exercise their right to vote on the details regarding dividends for the year under review can be found in the
resolutions proposed at the AGM. Chairman's Statement in the Annual Report.
Shareholder documents - the Company reports formally to Shareholders by Share buy-back policy - the Directors recognise the importance to Shareholders
publishing Annual and Interim Reports, normally in March and July each year. of the Company maintaining an active buy-back policy and considered this when
In the instance of a corporate action taking place, the Board will communicate establishing the current programme. Further details can be found in the
with Shareholders through the issue of a Circular and, if required, a Chairman's Statement and in the Directors' Report in the Annual Report.
Prospectus.
Offer for Subscription - in making a decision to launch an Offer for
In addition, significant matters or reporting obligations are disseminated to Subscription, the Directors considered that it would be in the interest of
Shareholders by way of Stock Exchange Announcements. Shareholders to continue to grow the portfolio and make investments across a
diverse range of sectors. By growing the Company, costs are spread over a
wider asset base, which helps to promote a competitive total expense ratio,
which is in the interests of Shareholders. In addition, the increased
The Secretary acts as a key point of contact for the Board and communications liquidity helps support the buy-back policy referred to above.
received from Shareholders are circulated to the whole Board.
Liquidity management - in order to generate income and add value for
Shareholders, the Board has an active liquidity management policy, which has
the objective of generating income from the cash held prior to investment.
Further details regarding the liquidity management policy can be found in the
Investment Manager's Review in the Annual Report.
Environment and society
The Directors and the Manager take account of the social, environmental and The Directors and the Manager are aware of their duty to act in the interests
ethical factors impacted by the Company and the investments that it makes. of the Company and acknowledge that there are risks associated with investment
in companies that fail to conduct business in a socially responsible manner.
The Manager's ESG assessment of investee companies focuses heavily on their
impact on the environment, challenging fundamental aspects such as energy and
emissions usage, and targets an approach to waste and recycling as well as
broader social themes such as the companies' approach to diversity and
inclusion in the workplace and their work with charities. Further details can
be found in the Chairman's Statement and in the Statement of Corporate
Governance in the Annual Report.
Portfolio companies
Quarterly Board Meetings - the Manager reports to the Board on the portfolio The Directors are aware that the exercise of voting rights is key to promoting
companies, in particular, on the private investee companies, and the Directors good corporate governance and, through the Manager, ensures that the portfolio
challenge the Manager if they feel it is appropriate. The Manager then companies are encouraged to adopt best practice corporate governance. The
communicates directly with each private investee company, normally through the Board has delegated the responsibility for monitoring the portfolio companies
Maven representative who sits on the board of the private investee company. to the Manager and has given it discretion to vote in respect of the Company's
holdings in the investment portfolio, in a way that reflects the concerns and
key governance matters discussed by the Board. From time to time, the
management teams of the private investee companies give presentations to the
Board.
The Board is also mindful that, as the portfolio expands and the proportion of
early stage investment increases, follow-on funding will represent an
important part of the Company's investment strategy and this forms a key part
of the Directors' discussions on valuations, risk management and fundraising.
Manager
Quarterly Board Meetings - the Manager attends every Board Meeting and The Manager is responsible for implementing the investment objective and the
presents a detailed portfolio analysis and reports on key issues such as VCT strategy agreed by the Board. In making a decision to launch any Offer for
compliance, investment pipeline and utilisation of any new monies raised. Subscription, the Board needs to consider that the Company requires to have
sufficient liquidity to continue to expand and broaden the investment
portfolio in line with the strategy, including the provision of follow-on
funding, as referred to above.
Registrar
Annual review meetings and control reports. The Directors review the performance of all third party service providers on
an annual basis, including ensuring compliance with GDPR. During the year, the
decision was made to change registrar and City Partnership was appointed on 25
October 2021.
Custodian
Regular statements and control reports received, with all holdings and The Directors review the performance of all third party providers on an annual
balances reconciled. basis, including oversight of securing the Company's assets.
Employee, Environmental and Human Rights Policy
The Company has no direct employee or environmental responsibilities, nor is
it directly responsible for the emission of greenhouse gases. The Board's
principal responsibility to Shareholders is to ensure that the investment
portfolio is managed and invested properly. The Company has no employees and,
accordingly, has no requirement to report separately on employment matters.
The Board comprises three male Directors and delegates responsibility for
diversity to the Nomination Committee, as explained in the Statement of
Corporate Governance in the Annual Report. The management of the portfolio is
undertaken by the Manager through members of its portfolio management team.
The Manager engages with the Company's underlying investee companies in
relation to their corporate governance practices and in developing their
policies on social, community and environmental matters and further
information can be found in the Statement of Corporate Governance in the
Annual Report. Additional work is being carried out by the Manager to
establish a framework for the effective capture of ESG information,
consistently across all investee companies. The Manager will be overseeing the
collation of this information for the benefit of the Board but will also be
supporting individual companies to identify ESG risks and opportunities and,
where potential improvements are identified, will work jointly with investee
businesses to make positive changes.
In light of the nature of the Company's business, there are no relevant human
rights issues and, therefore, the Company does not have a human rights policy.
Auditor
The Company's Auditor is required to report if there are any material
inconsistencies between the content of the Strategic Report and the Financial
Statements. The Independent Auditor's Report can be found in the Annual
Report.
Future Strategy
The Board and Manager intend to maintain the policies set out above for the
year ending 30 November 2022, as it is believed that these are in the best
interests of Shareholders.
Approval
The Business Report, and the Strategic Report as a whole, was approved by the
Board of Directors and signed on its behalf by:
Graham Miller
Director
10 March 2022
Income Statement
For the year ended 30 November 2021
Year ended Year ended
30 November 2021 30 November 2020
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Gains on investments - 9,624 9,624 - 1,442 1,442
Income from investments 516 - 516 473 - 473
Other income 3 - 3 28 - 28
Investment management fees (324) (972) (1,296) (239) (718) (957)
Other expenses (415) - (415) (330) - (330)
Net return on ordinary activities before taxation (220) 8,652 8,432 (68) 724 656
Tax on ordinary activities - - - 33 (33) -
Return attributable to Equity Shareholders (220) 8,652 8,432 (35) 691 656
Earnings per share (pence) (0.14) 5.38 5.24 (0.03) 0.55 0.52
All gains and losses are recognised in the Income Statement.
All items in the above statement are derived from continuing operations. The
Company has only one class of business and one reportable segment, the results
of which are set out in the Income Statement and Balance Sheet. The Company
derives its income from investments made in shares, securities and bank
deposits.
There are no potentially dilutive capital instruments in issue and, therefore,
no diluted earnings per share figures are relevant. The basic and diluted
earnings per share are, therefore, identical.
The Notes are an integral part of the Financial Statements and can be found in
full in the Annual Report.
Statement of Changes in Equity
For the year ended 30 November 2021
Year ended 30 November 2021
Non Distributable Reserves Distributable Reserves
Share Capital Share premium account Capital redemption unrealised Capital reserve Capital reserve realised Special distributable reserve Revenue reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
At 30 November 2020 12,405 21 218 (3,095) 1,734 35,087 (1,234) 45,136
Net return - - - 9,638 (14) (972) (220) 8,432
Dividends paid - - - - - (3,874) - (3,874)
Repurchase and cancellation of shares (266) - 266 - - (933) - (933)
Net proceeds of share issue 5,381 14,210 - - - - - 19,591
Net proceeds of DIS issue 115 296 - - - - - 411
At 30 November 2021 17,635 14,527 484 6,543 1,720 29,308 (1,454) 68,763
Year ended 30 November 2020
Non Distributable Reserves Distributable Reserves
Share capital Share premium account Capital redemption reserve Capital reserve unrealised Capital reserve realised Special distributable reserve Revenue reserve Total
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
At 30 November 2019 12,608 23,180 3,955 (2,803) - 11,260 (1,076) 47,124
Net return - - - (292) 1,734 (751) (35) 656
Cancellation of share premium account - (23,180) - - - 23,180 - -
Cancellation of capital redemption reserve - - (3,955) - - 3,955 - -
Share premium cancellation costs - (10) - - - - - (10)
Dividends paid - - - - - (1,882) (123) (2,005)
Repurchase and cancellation of shares (218) - 218 - - (675) - (675)
Net proceeds of DIS issue 15 31 - - - - - 46
At 30 November 2020 12,405 21 218 (3,095) 1,734 35,087 (1,234) 45,136
The capital reserve unrealised is generally non-distributable other than the
part of the reserve relating to gains/(losses) attributable to readily
realisable quoted investments that are distributable.
The Notes are an integral part of the Financial Statements and can be found in
full in the Annual Report.
Balance Sheet
As at 30 November 2021
30 November 2021 30 November 2020
£'000 £'000
Fixed assets
Investments at fair value through profit or loss 46,313 33,821
Current assets
Debtors 436 242
Cash 22,434 11,543
22,870 11,785
Creditors
Amounts falling due within one year (420) (470)
Net current assets 22,450 11,315
Net assets 68,763 45,136
Capital and reserves
Called up share capital 17,635 12,405
Share premium account 14,527 21
Capital redemption reserve 484 218
Capital reserve - unrealised 6,543 (3,095)
Capital reserve - realised 1,720 1,734
Special distributable reserve 29,308 35,087
Revenue reserve (1,454) (1,234)
Net assets attributable to Ordinary Shareholders 68,763 45,136
Net asset value per Ordinary Share (pence) 38.99 36.38
The Financial Statements of Maven Income and Growth VCT 5 PLC, registered
number 4084875, were approved and authorised for issue by the Board of
Directors on 10 March 2022 and were signed on its behalf by:
Graham Miller
Director
10 March 2022
The Notes are an integral part of the Financial Statements and can be found in
full in the Annual Report.
Cash Flow Statement
For the year ended 30 November 2021
Year ended Year ended
30 November 2021 30 November 2020
£'000 £'000
Net cash flows from operating activities (1,042) (720)
Cash flows from investing activities
Purchase of investments (8,067) (7,196)
Sale of investments 4,885 3,549
Net cash flows from investing activities (3,182) (3,647)
Cash flows from financing activities
Equity dividends paid (3,874) (2,005)
Issue of Ordinary Shares 20,002 46
Share premium cancellation costs - (10)
Repurchase of Ordinary Shares (1,013) (769)
Net cash flows from financing activities 15,115 (2,738)
Net increase/(decrease) in cash 10,891 (7,105)
Cash at beginning of year 11,543 18,648
Cash at end of year 22,434 11,543
The Notes are an integral part of the Financial Statements and can be found in
full in the Annual Report.
Notes to the Financial Statement
For the year ended 30 November 2021
1 Accounting Policies
The Company is a public limited company, incorporated in England and Wales and
its registered office is shown in the Corporate Summary in the Annual Report.
(a) Basis of preparation
The Financial Statements have been prepared on a going concern basis,
including an assessment of the impact of COVID-19 on the finances of the
Company, as covered in the Directors' Report in the Annual Report. The
Financial Statements have been prepared under the historical cost convention,
as modified by the revaluation of investments and in accordance with FRS 102,
The Financial Reporting Standard applicable in the UK and Republic of Ireland,
and in accordance with the Statement of Recommended Practice for Investment
Trust Companies and Venture Capital Trusts (the SORP) issued by the AIC in
April 2021.
(b) Income
Dividends receivable on equity shares and unit trusts are treated as revenue
for the period on an ex-dividend basis. Where no ex-dividend date is
available dividends receivable on or before the year end are treated as
revenue for the period. Provision is made for any dividends not expected to be
received. The fixed returns on debt securities and non-equity shares are
recognised on a time apportionment basis so as to reflect the effective
interest rate on the debt securities and shares. Provision is made for any
fixed income not expected to be received. Interest receivable from cash and
short term deposits and interest payable are accrued to the end of the year.
(c) Expenses
All expenses are accounted for on an accruals basis and charged to the Income
Statement. Expenses are charged through the revenue account except as
follows:
• expenses which are incidental to the acquisition and
disposal of an investment are charged to capital; and
• expenses are charged to the special distributable reserve
where a connection with the maintenance or enhancement of the value of the
investments can be demonstrated. In this respect the investment management
fee and performance fee have been allocated 25% to revenue and 75% to the
special distributable reserve to reflect the Company's investment policy and
prospective income and capital growth.
(d) Taxation
Deferred taxation is recognised in respect of all timing differences that have
originated but not reversed at the balance sheet date, where transactions or
events that result in an obligation to pay more tax in the future or right to
pay less tax in the future have occurred at the balance sheet date. This is
subject to deferred tax assets only being recognised if it is considered more
likely than not that there will be suitable profits from which the future
reversal of the underlying timing differences can be deducted. Timing
differences are differences arising between the Company's taxable profits and
its results as stated in the Financial Statements which are capable of
reversal in one or more subsequent periods.
Deferred tax is measured on a non-discounted basis at the tax rates that are
expected to apply in the periods in which timing differences are expected to
reverse, based on tax rates and laws enacted or substantively enacted at the
balance sheet date.
The tax effect of different items of income/gain and expenditure/loss is
allocated between capital reserves and revenue account on the same basis as
the particular item to which it relates using the Company's effective rate of
tax for the period.
UK corporation tax is provided at amounts expected to be paid/recovered using
the tax rates and laws that have been enacted or substantively enacted at the
balance sheet date.
(e) Investments
In valuing unlisted investments the Directors follow the criteria set out
below. These procedures comply with the revised IPEV Guidelines for the
valuation of private equity and venture capital investments. Investments are
recognised at their trade date and are designated by the Directors as fair
value through profit and loss. At subsequent reporting dates, investments are
valued at fair value, which represents the Directors' view of the amount for
which an asset could be exchanged between knowledgeable and willing parties in
an arm's length transaction. This does not assume that the underlying business
is saleable at the reporting date or that its current shareholders have an
intention to sell their holding in the near future.
A financial asset or liability is generally derecognised when the contract
that gives rise to it is settled, sold, cancelled or
expires.
1. For early stage investments completed in the reporting period,
fair value is determined using the price of recent investment, calibrating for
any material change in the trading circumstances of the investee company.
Other early stage investments are valued using a milestone approach, in
particular where it is considered there are no deemed current or short-term
future maintainable earnings or positive cashflows.
2. Whenever practical, recent investments will be valued by
reference to a material arm's length transaction or a quoted price.
3. Mature companies are valued by applying a multiple to their
maintainable earnings to determine the enterprise value of the company.
To obtain a valuation of the total ordinary share capital
held by management and the institutional investors, the value of third party
debt, institutional loan stock, debentures and preference share capital is
deducted from the enterprise value. The effect of any performance related
mechanisms is taken into account when determining the value of the ordinary
share capital.
4. In the absence of evidence of a deterioration, or strong defensible
evidence of an increase in value, the fair value is determined to be that
reported at the previous balance sheet date.
5. All unlisted investments are valued individually by the portfolio
management team of Maven. The resultant valuations are subject to detailed
scrutiny and approval by the Directors of the Company.
6. In accordance with normal market practice, investments listed on
the AIM or a recognised stock exchange are valued at their bid market price.
(f) Fair value measurement
Fair value is defined as the price that the Company would receive upon selling
an investment in a timely transaction to an independent buyer in the principal
or the most advantageous market of the investment. A three-tier hierarchy
has been established to maximise the use of observable market data and
minimise the use of unobservable inputs and to establish classification of
fair value measurements for disclosure purposes. Inputs refer broadly to the
assumptions that market participants would use in pricing the asset or
liability, including assumptions about risk, for example, the risk inherent in
a particular valuation technique used to measure fair value including such a
pricing model and/or the risk inherent in the inputs to the valuation
technique. Inputs may be observable or unobservable.
Observable inputs are inputs that reflect the assumptions market participants
would use in pricing the asset or liability developed based on market data
obtained from sources independent of the reporting entity.
Unobservable inputs are inputs that reflect the reporting entity's own
assumptions about the assumptions market participants would use in pricing the
asset or liability developed based on best information available in the
circumstances.
The three-tier hierarchy of inputs is summarised in the three broad levels
listed below.
- Level 1 - the unadjusted quoted price in an active market for
identical assets or liabilities that the entity can access at the measurement
date.
-
Level 2 - inputs other than quoted prices included within
Level 1 that are observable (i.e. developed using market data) for the asset
or liability, either directly or indirectly.
-
Level 3 - inputs are unobservable (i.e. for which market
data is unavailable) for the asset or liability.
(g) Gains and losses on investments
When the Company sells or revalues its investments during the year, any gains
or losses arising are credited/charged to the Income Statement.
(h) Critical accounting judgements and key sources of estimation uncertainty
Disclosure is required of judgements and estimates made by the Board and the
Manager in applying the accounting policies that have a significant effect on
the financial statements. The area involving the highest degree of judgement
and estimates is the valuation of early stage unlisted investments recognised
in Note 8 in the Annual Report and explained in Note 1(e) above.
In the opinion of the Board and the Manager, there are no critical accounting
judgements.
Reserves
Share premium account
The share premium account represents the premium above nominal value received
by the Company on issuing shares net of issue costs. This reserve is
non-distributable.
Capital redemption reserve
The nominal value of shares repurchased and cancelled is represented in the
capital redemption reserve. This reserve is non-distributable.
Capital reserve - unrealised
Increases and decreases in the fair value of investments are recognised in the
Income Statement and are then transferred to the capital reserve unrealised
account. This reserve is non-distributable.
Capital reserve - realised
Gains or losses on investments realised in the year that have been recognised
in the Income Statement are transferred to the capital reserve realised
account on disposal. Furthermore, any prior unrealised gains or losses on such
investments are transferred from the capital reserve unrealised account to the
capital reserve realised account on disposal. This reserve is distributable.
Special distributable reserve
The total cost to the Company of the repurchase and cancellation of shares is
represented in the special distributable reserve account. The special
distributable reserve also represents capital dividends, capital investment
management fees and the tax effect of capital items. This reserve is
distributable.
Revenue reserve
The revenue reserve represents accumulated profits retained by the Company
that have not been distributed to Shareholders as a dividend. This reserve is
distributable.
Return per Ordinary Share
Year ended Year ended
30 November 2021 30 November 2020
The returns per share have been based on the following figures:
Weighted average number of Ordinary Shares 160,814,292 125,305,497
Revenue return (£220,000) (£35,000)
Capital return £8,652,000 £691,000
Total return £8,432,000 £656,000
Net asset value per Ordinary Share
The net asset value per Ordinary Share as at 30 November 2021 has been
calculated using the number of Ordinary Shares in issue at that date of
176,361,696 (2020: 124,055,920).
Directors' Responsibility Statement
The Directors confirm that, to the best of their knowledge:
• the Financial Statements have been prepared in accordance with
the applicable accounting standards and give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Company as
at 30 November 2021 and for the year to that date;
• the Directors' Report includes a fair review of the
development and performance of the Company, together with a description of the
principal risks and uncertainties that it faces; and
• the Annual Report and Financial Statements taken as a whole is
fair, balanced and understandable and provides the information necessary for
Shareholders to assess the Company's position and performance, business model
and strategy.
Other information
The Annual General Meeting will be held on Tuesday, 26 April 2022, commencing
at 11.30am, at the offices of Maven Capital Partners UK LLP, Fifth Floor, 1-2
Royal Exchange Buildings, London EC3V 3LF.
Copies of this announcement and copies of the Annual Report and Financial
Statements for the year ended 30 November 2021, will be available to the
public at the offices of Maven Capital Partners UK LLP, Kintyre House, 205
West George Street, Glasgow G2 2LW; at the registered office of the Company,
Fifth Floor, 1-2 Royal Exchange Buildings, London EC3V 3LF and on the
Company's website at www.mavencp.com/migvct5 (http://www.mavencp.com/migvct5)
.
The Annual Report and Financial Statements for the year ended 30 November 2021
will be issued to Shareholders and filed with the Registrar of Companies in
due course.
The financial information contained within this Announcement does not
constitute the Company's statutory Financial Statements as defined in the
Companies Act 2006. The statutory Financial Statements for the year ended 30
November 2020 have been delivered to the Registrar of Companies and contained
an audit report which was unqualified and did not constitute statements under
S498(2) or S498(3) of the Companies Act 2006.
Neither the content of the Company's website nor the contents of any website
accessible from hyperlinks on the Company's website (or any other website) is
incorporated into, or forms part of, this announcement.
The 2021 Annual Report will be submitted to the National Storage Mechanism and
will be available for inspection at:
www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism
(http://www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism)
.
By order of the Board
Maven Capital Partners UK LLP
Secretary
10 March 2022
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