REG - Maven Inc&Grwth 5 - Annual Financial Report
23/03/2023 17:30
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RNS Number : 0732U Maven Income and Growth VCT 5 PLC 23 March 2023
Maven Income and Growth VCT 5 PLC
Final results for the year ended 30 November 2022
The Directors report the Company's financial results for the year ended 30
November 2022.
Highlights
• NAV total return at the year end of 85.05p per share (2021:
84.64p)
• NAV at the year end of 35.40p per share (2021: 38.99p), after
total dividend payments of 4.00p per share during the year
• Enhanced interim dividend of 3.00p per share paid following the
realisation of Ideagen
• Final dividend of 0.50p per share proposed for payment on 5 May
2023
• Offer for Subscription launched to raise up to £10 million
alongside the other Maven VCTs
Strategic Report
Chairman's Statement
On behalf of your Board, I am pleased to present the 2022 Annual Report.
During the financial year, the unsettled economic and geopolitical landscape
created a challenging operating environment, and it is, therefore, encouraging
to report on the progress that has been achieved by your Company. The stable
NAV total return that has been reported reflects the strength and diversity of
the unlisted portfolio, where many private companies have continued to achieve
revenue growth and meet commercial objectives, which has merited uplifts to
certain valuations. Conversely, the continued volatility within financial
markets has had an impact on AIM, resulting in your Company's AIM quoted
portfolio declining in value. Notwithstanding the wider market conditions, in
May 2022 there was a notable development when the holding in Ideagen received
an all cash offer at a significant premium to the underlying share price. The
exit generated a total return of 15x cost and material cash proceeds, which
enabled your Board to declare an enhanced interim dividend. This has also been
a good period for private company realisations with the completion of seven
profitable exits, including the sale of Quorum Cyber, which generated a total
return of 6.5x cost, inclusive of a retained shareholding in the acquiring
entity. Further to this, and consistent with the commitment to make regular
tax free distributions, the Directors are pleased to propose a final dividend
of 0.50p per share for payment in May 2023, which will bring the annual yield
to 8.98%, thereby comfortably exceeding the 5% target.
Overview
During the first half of the financial year, the impact of the pandemic
significantly reduced, enabling most economies to reopen and whilst there was
an initial surge in activity, the recovery was tempered by the invasion of
Ukraine by Russia. Whilst this humanitarian tragedy has garnered global
condemnation, it has also had far reaching economic consequences, the most
notable of which have been the sharp rise in global energy prices and the
widespread disruption to international supply chains. The UK has not been
immune to these external events, with the energy price shock significantly
contributing to the current high level of inflation and the cost of living
crisis which, alongside rising interest rates, has created a challenging
situation for many consumers and businesses.
Against this backdrop, it is encouraging to report on the performance that has
been achieved by your Company. The resilient NAV total return that has been
reported, reflects the consistent application of the investment strategy,
which has been in place for a number of years and has the core objective of
building a large and sectorally diversified portfolio of high growth private
and AIM quoted companies that operate across a broad range of end markets, and
which are capable of achieving scale and generating a capital gain on exit.
During the year, there has been further development of the portfolio with the
addition of 13 new private companies, with follow-on funding also provided to
support those companies that are achieving commercial targets and require
additional capital to fully scale before securing an exit. The Manager
continues to see strong demand for growth capital from ambitious and
entrepreneurial private companies across its network of regional offices and
remains well placed to continue to source and execute high quality VCT
qualifying investments to ensure that your Company maintains a good rate of
investment in the new financial year.
Your Board remains committed to future growth and in early October 2022 the
Directors were pleased to launch an Offer for Subscription alongside the other
Maven managed VCTs. Your Company has a target raise of £10 million, and it is
encouraging to report that, at the time of writing, £5.18 million has been
raised by your Company. The Directors would like to remind Shareholders that
the Offers remain open until 4 April 2023 for the 2022/23 tax year and until
26 May 2023 for the 2023/24 tax year, unless fully subscribed ahead of this
date. Further information about the Offers, can be found at:
mavencp.com/vctoffer. With respect to future fund raisings, the Board and the
Manager welcomed the announcement by the UK Government in September 2022 that
tax relief for the VCT and EIS schemes would continue beyond 2025. The news
that the period covered by the "sunset clause" will be extended removes
uncertainty for investors and allows entrepreneurial SMEs to continue to
access this important source of growth capital.
It is pleasing to report on the tangible progress that has been achieved
across the early stage unlisted portfolio, where the majority of companies
have continued to deliver revenue growth and achieve commercial milestones,
meriting uplifts to certain valuations. Your Company also benefits from a
portfolio of later stage private companies, completed prior to the change in
VCT rules, and these more mature holdings help to counterbalance the risks
associated with earlier stage growth companies. This positive performance has,
however, been offset by the volatility that has affected financial markets
throughout the year, and which has impacted the value of your Company's AIM
quoted portfolio, where share prices have declined in response to negative
investor sentiment. During the year, the value of your Company's AIM quoted
portfolio reduced by 16.2%, compared to a 26.7% reduction in the FTSE AIM
All-Share Index over the same time period. Across AIM, there has also been
limited IPO and new share issuance activity, with only two new AIM quoted
investments completed by your Company during the year. Your Board continues to
believe that a blended portfolio of private equity and AIM quoted holdings
provides the optimal structure for delivering long term growth in Shareholder
value, however, the Manager will remain cautious on any new AIM investments
until there is clear evidence of a recovery in this market and an improvement
in the quality and range of companies seeking VCT investment.
This has been a strong period for portfolio realisations with the completion
of seven profitable private company exits, including the most significant
realisation to date from the early stage portfolio with the sale of Quorum
Cyber, which achieved a total return of 6.5x cost inclusive of a retained
shareholding in the acquiring entity. A further highlight was the realisation
of your Company's holding in AIM quoted Ideagen, which received an all cash
offer at a 52% premium to the underlying share price. This exit generated cash
proceeds of £5.9 million and a total return of 15x cost over the life of the
investment. Following this realisation, your Company's exposure to AIM is
significantly reduced, which is consistent with the Director's previously
stated strategic objective to reduce the size of certain larger AIM quoted
holdings to rebalance the portfolio as a whole.
Full details of the portfolio developments, including the new investments and
realisations completed during the year, as well as updates on the companies
that have delivered a positive performance and where valuations have been
uplifted, alongside the small number of cases where valuations have been
reduced or fully written down, can be found in the Investment Manager's Review
in the Annual Report. Shareholders will also find details of the principal Key
Performance Indicators (KPIs) in the Business Report and a summary of the
Alternative Performance Measures (APMs) can be found in the Financial
Highlights in the Annual Report.
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.
The Directors would like to remind Shareholders that, as the portfolio
continues to expand and a greater proportion of investments are 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 may 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
Your Board is pleased to propose a final dividend of 0.50p per Ordinary Share
in respect of the year ended 30 November 2022, which will be paid on 5 May
2023 to Shareholders on the register at 31 March 2023. This will bring total
distributions for the financial year to 3.50p per Ordinary Share, representing
a yield of 8.98% based on the NAV at the immediately preceding year end of
38.99p per share. Since the Company's launch, and after receipt of the
proposed final dividend, Shareholders will have received a total of 50.15p per
share in tax free distributions.
Dividend Investment Scheme (DIS)
Your Company operates a DIS, through which Shareholders can, at any time,
elect to have their dividend payments 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, by completing a DIS mandate. In order for the DIS to apply to the
final dividend that is due to be paid on 5 May 2023, the mandate form must be
received by the Registrar (The City Partnership) before 19 April 2023, this
being the relevant dividend election date. The mandate form, terms &
conditions and full details of the scheme (including tax considerations) are
available from the Company's website at: mavencp.com/migvct5. Election to
participate in the DIS can also be made through the Registrar's online
investor hub at: 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 7 October 2022, your Company, alongside Maven Income and Growth VCT PLC,
Maven Income and Growth VCT 3 PLC and Maven Income and Growth VCT 4 PLC,
launched Offers for Subscription for up to £40 million in aggregate,
inclusive of over-allotment facilities for up to £10 million in aggregate,
for the 2022/23 and 2023/24 tax years. Your Company has a target raise of £10
million and as at the date of the Annual Report, it has raised a total of
£5.18 million.
With respect to the 2022/23 tax year, an allotment of 9,705,619 new Ordinary
Shares completed on 8 February 2023, with a further allotment of 1,005,373 new
Ordinary Shares completing on 3 March 2023. A final allotment for the 2022/23
tax year will be made on or before 5 April 2023. The Offers will close on 26
May 2023, unless a particular Offer is fully subscribed ahead of this date,
and an allotment for the 2023/24 tax year is expected take place on or before
31 May 2023.
The Directors are confident that Maven's regional office network has the
capacity and capability to continue to source attractive investment
opportunities in VCT qualifying companies, and that the additional liquidity
provided by the fundraising will facilitate further expansion and development
of the portfolio in line with the investment strategy. 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 for
the Company to buy back its own shares in the secondary market, for
cancellation or to be held in treasury, subject always to such transactions
being in the best interests of Shareholders.
As announced in the 2022 Interim Report, the Directors carried out a further
review of the Company's share buy-back policy and following that review it is
intended that the Company will seek to buy back shares with a view to
maintaining a share price discount that is approximately 5% below the latest
published NAV per share. This will be adjusted, where appropriate, for any
dividends in respect of which the Company's shares are trading ex-dividend,
and is subject to market conditions, available liquidity and the maintenance
of the Company's VCT qualifying status.
Shareholders should be aware that neither the Company nor the Manager can
execute a direct transaction in the Company's shares. Any instruction to buy
or sell shares on the secondary market must be conducted through a
stockbroker. If a Shareholder wishes to buy or sell shares on the secondary
market, they or their broker can contact the Company's corporate broker, Shore
Capital Stockbrokers on 020 7647 8132, to discuss a transaction. It should,
however, be noted that such transactions cannot take place whilst the Company
is in a closed period, which is the time from the end of a reporting period
(quarter end, half year or full year) until the announcement of the relevant
results, or the release of an unaudited NAV. A closed period may also be
introduced if the Directors and Manager are in possession of price sensitive
information that may restrict the Company's ability to buy back shares.
VCT Regulatory Developments
During the period under review, there were no further amendments to the rules
governing VCTs. Shareholders may, however, be aware that under the VCT scheme
approved by the European Commission in 2015, a "sunset clause" was introduced
which stated that income tax relief would no longer be available on
subscriptions for new shares in VCTs made on or after 6 April 2025, unless the
legislation was renewed by an HM Treasury order. During the financial year,
there has been a considerable level of activity by industry participants
including The Association of Investment Companies (AIC), of which the Company
is a member, and the Venture Capital Trust Association (VCTA), of which the
Manager is an active member, to demonstrate the important role of VCT
investment in supporting ambitious SMEs and stimulating economic growth and
regional employment. It is, therefore, encouraging to report that the UK
Government has committed to extend the income tax relief available on new VCT
shares beyond 2025. In the budget statement of 17 November 2022, the
Chancellor reconfirmed the Government's commitment to extend the VCT scheme
beyond 2025. The Manager will remain actively involved in discussions
regarding the process for implementing this extension.
Consistent with industry best practice, 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. Following the invasion of Ukraine
in February 2022, IPEV reiterated the Special Guidance originally provided in
March 2020 at the outbreak of the COVID-19 pandemic in the UK, with respect to
assessing the fair value of private company holdings. The Directors and the
Manager continue to follow industry guidelines and adhere to the IPEV Special
Guidelines for all private company valuations.
Environmental, Social and Governance (ESG) Considerations
The Board and the Manager acknowledge the importance of ESG principles and
consider that those portfolio companies that have ESG aims integrated into
their business model benefit both society and Shareholders. The Board and the
Manager believe that there is an interconnectivity between profit and purpose,
and that strong ESG credentials can give companies a competitive edge.
The Board is pleased to report on the continued focus by the Manager in
developing its ESG framework and oversight capabilities. In order to assist
this process, Maven has partnered with a specialist software provider to
enhance its ability to track, analyse and report key ESG information across
the portfolio. The Manager is in the process of standardising its internal
metrics, which will be measured from year to year with the intention of
reducing carbon footprint and improving and enhancing key governance and
social metrics.
The Manager has a comprehensive ESG policy in place, which is ingrained within
the investment process, as a standard part of due diligence for any new
investment to ensure that ESG risks and opportunities are fully considered. A
number of investee companies are already very focused on the environment or
making improvements to society and local communities and have set themselves
specific ESG related goals. Where this is not the case, the Manager is able to
support and advise on the value of improving these metrics and all investee
companies are required to include ESG as a standing board agenda item to
encourage regular dialogue on the topic.
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 is also 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.
Although 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 in providing 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 its ESG initiatives and progress will
be monitored by the Directors.
The Board is aware of the significant steps that are being taken by the
Manager to assess ESG capability and support ongoing dialogue with investee
companies, with the aim of improving ESG metrics over the period that your
Company is invested. However, the Board wishes to remind Shareholders that
your Company's investment policy does not incorporate specific ESG aims, and
investee companies are not required to meet any specific targets.
Shareholder Communications
Twice a year Maven publishes a VCT newsletter, Creating Value, which is issued
by email or post, and includes details on the new investments and realisations
that have been completed by the Maven VCTs, as well as updates about the VCT
portfolios and investee companies, and the launch of new Maven VCT Offers.
Shareholders wishing to receive this newsletter, and other VCT related
information, can register their email address with the Registrar, The City
Partnership, or subscribe through Maven's website.
Appointment of a New Auditor
Following a formal tender process, Johnston Carmichael LLP (Johnston
Carmichael) was appointed as the new Auditor to the Company with effect from 4
October 2022. Johnston Carmichael conducted the audit of the Financial
Statements for the financial year to 30 November 2022 and the Independent
Auditor's Report can be found in the Annual Report. Shareholders will be asked
to confirm the appointment of Johnston Carmichael at the forthcoming AGM.
Annual General Meeting (AGM)
The 2023 AGM will be held in the Glasgow office of Maven Capital Partners UK
LLP, at Kintyre House, 205 West George Street, Glasgow G2 2LW on 25 April
2023, commencing at 11:30am. The Notice of Annual General Meeting can be found
in the Annual Report.
The Future
Despite the challenging macroeconomic backdrop, the Directors are encouraged
by the progress that has been achieved by your Company during the financial
year. The realisation of Ideagen helped to further rebalance the portfolio
and, at the same time, allowed for an enhanced interim dividend to be paid.
Additionally, your Company has added a large number of new private companies
to the portfolio in recent years, which allows for further diversification by
sector and absolute number of holdings. This strategy of portfolio expansion
will continue, supplemented by fundraising to match the level of new
investment activity. The Manager has a track record of successfully completing
and realising private company holdings through sales to a wide range of
financial and trade buyers, and this trend is expected to continue as the
portfolio expands every year. The Board and Manager believe that is the
optimum strategy in support of the target dividend level for Shareholders,
which has been exceeded in the last year.
Graham Miller
Chairman
23 March 2023
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 VCT 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 is aware of the heightened cyber security risk and potential
consequences of IT failure, particularly in relation to the increased
utilisation of remote working practices by the Manager and key third parties.
A cyber attack or systems failure not only has the potential to cause a third
party to fail to perform its duties and responsibilities in accordance with
the service level agreements that are in place, but could also result in it
encountering financial difficulties, such that it is unable to carry on
trading and cannot continue to provide services to the Company.
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 AIC, the British
Venture Capital Association (BVCA) and the 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 (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 the 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 5% of Shareholders now receiving printed
reports.
The Board is aware that the Manager has increased its efforts in relation to
the identification of environmental risks and opportunities facing investee
companies, and has developed 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.
Generally, VCTs 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.
Political Risk
Political changes that result in parties with extreme political or social
agendas having power or influence over policies could lead to instability and
uncertainty in the markets, legislation and the economy.
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.
Ukraine
The conflict in Ukraine and the global response has resulted in disruptions to
international supply chains, inflationary pressure on prices and general
market uncertainty. In addition, it is acknowledged that there is an increased
cyber security risk and 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 consistent with the active liquidity management policy, also has the
ability to hold certain listed investment trusts prior to any investment in
new or follow-on investment opportunities. The Company has only limited direct
exposure to currency risk and does not enter into any derivative transactions.
Economic Risk
The valuation of investment companies may be affected by underlying economic
conditions such as rising interest rates and the availability of bank finance,
which can be impacted during times of geopolitical uncertainty and fluctuating
markets, including the impact of the current cost of living crisis and rising
interest rates currently being experienced in the UK. 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 can be found in Note 16 to the Financial Statements in the Annual
Report.
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 the
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 2022 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 breadth and depth 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 Portfolio Analysis charts in the Annual Report
show the profile of the portfolio by industry sector and by asset class. They
help to show the sectoral diversity of the portfolio and the hybrid structure,
which is balanced between private growth capital companies, more mature
private company holdings 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 otherwise required.
Key Performance Indicators (KPIs)
During the year, the net return on ordinary activities before taxation was
£693,000 (2021: £8,432,000), gains on investments were £2,082,000 (2021:
£9,624,000) and earnings per share were 0.39p (2021: 5.24p). The Directors
also consider a number of 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 and definitions of the APMs can be found in the
Glossary 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. 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.
Your Board continues to believe that a blended portfolio of private equity and
AIM quoted holdings provides the optimal structure for delivering long term
growth in Shareholder value, however, the Manager will remain cautious on any
new AIM investments until there is clear evidence of a recovery in this market
and an improvement in the quality and range of companies seeking VCT
investment.
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 and the graph in the Annual Report compares the Company's performance
against 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 IPEV Guidelines. Following the invasion of
Ukraine in February 2022, IPEV reiterated the Special Guidance provided in
March 2020, at the outbreak of the COVID-19 pandemic in the UK, with respect
to assessing the fair value of private company holdings. The Directors and the
Manager continue to follow these industry guidelines and adhere to the IPEV
Special Guidelines in all private company valuations. Investments quoted or
traded on a recognised stock exchange, including AIM, are valued at their
closing bid price at the year end.
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
Shareholders are also encouraged to exercise their right to vote on the decisions to pay interim and propose final dividends for each year. Further
resolutions proposed at the AGM. details regarding dividends for the year under review, and the dividend
policy, can be found in the Chairman's Statement.
Shareholder documents - the Company reports formally to Shareholders by
publishing Annual and Interim Reports, normally in March and July each year. Share buy-back policy - the Directors recognise the importance to Shareholders
In the instance of a corporate action taking place, the Board will communicate of the Company maintaining an active buy-back policy. During the year, the
with Shareholders through the issue of a Circular and, if required, a Directors reviewed and agreed to revise the current policy with the intention
Prospectus. that future share buy backs would be conducted with a view to maintaining a
share price discount that is approximately 5% below the latest published NAV
per share. Further details can be found in the Chairman's Statement and in the
Directors' Report in the Annual Report.
In addition, significant matters or reporting obligations are disseminated to
Shareholders by way of London Stock Exchange Announcements.
Offers for Subscription - in making the decision to launch the current Offer
for Subscription, the Directors considered that it would be in the interest of
The Secretary acts as a key point of contact for the Board and communications Shareholders to continue to grow the portfolio and make investments across a
received from Shareholders are circulated to the whole Board. 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
liquidity helps support the buy-back policy referred to above. Further details
regarding the current Offer for Subscription can be found in the Chairman's
Statement.
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 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, the Investment Manager's Review and in the Statement
of Corporate Governance in the Annual Report.
Portfolio companies
Quarterly Board Meetings - the Manager reports to the Board on the performance The Directors are aware that the exercise of voting rights is key to promoting
of portfolio companies, in particular, on the private companies, and the good corporate governance and, through the Manager, ensures that the portfolio
Directors challenge the Manager if they feel it is appropriate. The Manager companies are encouraged to adopt best practice corporate governance. The
then communicates directly with each private investee company, normally Board has delegated the responsibility for monitoring the portfolio companies
through the Maven representative who sits on 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
its board. 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 in relation to 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.
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 Investment Manager's Review and in the
Statement of Corporate Governance in the Annual Report. The Manager has
continued with its focus on developing its ESG framework and oversight
capabilities. Further details on the Manager's approach to ESG and the
progress made with developing its ESG framework can be found in the Chairman's
Statement in the Annual Report. 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 2023, 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
23 March 2023
Income Statement
For the year ended 30 November 2022
Year ended Year ended
30 November 2022 30 November 2021
Revenue Capital Total Revenue Capital Total
£'000 £'000 £'000 £'000 £'000 £'000
Gains on investments - 2,082 2,082 - 9,624 9,624
Income from investments 514 - 514 516 - 516
Other income 60 - 60 3 - 3
Investment management fees (369) (1,109) (1,478) (324) (972) (1,296)
Other expenses (485) - (485) (415) - (415)
Net return on ordinary activities before taxation (280) 973 693 (220) 8,652 8,432
Tax on ordinary activities - - - - - -
Return attributable to Equity Shareholders (280) 973 693 (220) 8,652 8,432
Earnings per share (pence) (0.16) 0.55 0.39 (0.14) 5.38 5.24
All gains and losses are recognised in the Income Statement.
The total column of this statement is the Profit & Loss Account of the
Company. The revenue and capital columns are supplementary to this and are
prepared under guidance published by the AIC. 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 2022
Year ended 30 November 2022
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 2021 17,635 14,527 484 6,543 1,720 29,308 (1,454) 68,763
Net return - - - (6,139) 8,221 (1,109) (280) 693
Dividends paid - - - - - (7,022) - (7,022)
Repurchase and cancellation (207) - 207 - - (729) - (729)
of shares
Net proceeds of DIS issue* 210 536 - - - - - 746
At 30 November 2022 17,638 15,063 691 404 9,941 20,448 (1,734) 62,451
Year ended 30 November 2021
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 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 (266) - 266 - - (933) - (933)
cancellation of shares
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
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 which are distributable.
Where all, or an element of the proceeds of sales have not been received in
cash or cash equivalent (as noted in the Realisations table in the Annual
Report), and are not readily convertible to cash, they do not qualify as
realised gains for the purposes of distributable reserves calculations and,
therefore, do not form part of distributable reserves. The split of unrealised
gains/(losses) for the year is detailed within the portfolio valuation section
of Note 8.
The Notes are an integral part of the Financial Statements and can be found in
full in the Annual Report.
*DIS represents the Dividend Investment Scheme as detailed in the Chairman's
Statement.
Balance Sheet
As at 30 November 2022
30 November 2022 30 November 2021
£'000 £'000
Fixed assets
Investments at fair value through profit or loss 43,090 46,313
Current assets
Debtors 602 436
Cash 19,303 22,434
19,905 22,870
Creditors
Amounts falling due within one year (544) (420)
Net current assets 19,361 22,450
Net assets 62,451 68,763
Capital and reserves
Called up share capital 17,638 17,635
Share premium account 15,063 14,527
Capital redemption reserve 691 484
Capital reserve - unrealised 404 6,543
Capital reserve - realised 9,941 1,720
Special distributable reserve 20,448 29,308
Revenue reserve (1,734) (1,454)
Net assets attributable to Ordinary Shareholders 62,451 68,763
Net asset value per Ordinary Share (pence) 35.40 38.99
The Financial Statements of Maven Income and Growth VCT 5 PLC, registered
number 04084875, were approved and authorised for issue by the Board of
Directors on 23 March 2023 and were signed on its behalf by:
Graham Miller
Director
23 March 2023
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 2022
Year ended Year ended
30 November 2022 30 November 2021
£'000 £'000
Net cash flows from operating activities (1,357) (1,042)
Cash flows from investing activities
Purchase of investments (10,715) (8,067)
Sale of investments 15,946 4,885
Net cash flows from investing activities 5,231 (3,182)
Cash flows from financing activities
Equity dividends paid (7,022) (3,874)
Issue of Ordinary Shares 746 20,002
Repurchase of Ordinary Shares (729) (1,013)
Net cash flows from financing activities (7,005) 15,115
Net (decrease)/increase in cash (3,131) 10,891
Cash at beginning of year 22,434
11,543
Cash at end of year 19,303 22,434
The Notes are an integral part of the Financial Statements and can be found in
full in the Annual Report.
Notes to the Financial Statements
For the Year Ended 30 November 2022
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, further
details can be found 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
July 2022.
(b) Income
Interest income on loan notes and dividends on preference shares are accrued
on a daily basis. Provision is made against this income where recovery is
doubtful. Where the terms of unquoted loan notes only require interest or a
redemption premium to be paid on redemption, the interest and the redemption
premium is recognised as income once redemption is reasonably certain. Until
such date interest is accrued daily and included within the valuation of the
investment. When a redemption premium is designed to protect the value of the
instrument holder's investment rather than reflect a commercial rate of
revenue return the redemption premium should be recognised as capital.
The treatment of redemption premiums is analysed to consider if they are
revenue or capital in nature on a company by company basis. A redemption
premium of £57,476 (2021: £34,303) was received in the year ended 30
November 2022. Income from fixed interest securities and deposit interest is
included on an effective interest rate basis.
Dividends on quoted shares are recognised as income when the related
investments are marked ex-dividend and where no dividend date is quoted, when
the Company's right to receive payment is established.
(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 during 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 companies are valued by applying a multiple to
the investee's revenue to derive the enterprise value of each company.
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. 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.
5. In accordance with normal market practice, investments listed on the
AIM or a recognised stock exchange are valued at their closing bid market
price at the year end.
(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 Notes 8 and 16 in the Annual Report and explained in Note 1(e).
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 generally non-distributable other than the part of
the reserve relating to gains/(losses) attributable to readily realisable
quoted investments which are 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 2022 30 November 2021
The returns per share have been based on the following figures:
176,072,463 160,814,292
Weighted average number of Ordinary Shares
(£280,000) (£220,000)
Revenue return £973,000 £8,652,000
Capital return
Total return £693,000 £8,432,000
Net asset value per Ordinary Share
The net asset value per Ordinary Share as at 30 November 2022 has been
calculated using the number of Ordinary Shares in issue as at that date of:
176,391,734 Ordinary Shares (2021: 176,361,696 Ordinary Shares).
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 2022 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, 25 April 2023, commencing
at 11.30am, at the offices of Maven Capital Partners UK LLP, Kintyre House,
205 West George Street, Glasgow G2 2LW.
Copies of this announcement and copies of the Annual Report and Financial
Statements for the year ended 30 November 2022, 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 2022
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 2021 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 2022 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
23 March 2023
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. END FR UOABROVUOUARRecent news on Maven Income and Growth VCT 5
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AnnouncementREG - Maven Inc&Grwth 5 - Result of AGM
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