Mobeus Inc&Gwth 4 - Annual Financial Report
16/04/2020 17:45
RNS Number : 9488J Mobeus Income & Growth 4 VCT PLC 16 April 2020 mobeus Income & Growth 4 VCT plc Annual Financial Results of the Company for the Year ended 31 December 2019
| Mobeus Income & Growth 4 VCT plc (the "Company") today announces the final results for the year ended 31 December 2019. These results were approved by the Board of Directors on 16 April 2020. You may, in due course, view the Annual Report & Financial Statements, comprising the statutory accounts of the Company by visiting www.mig4vct.co.uk. |
| As at 31 December 2019: Net assets: £50.04 million Net asset value ("NAV") per share: 74.90 pence |
| - | Net asset value ("NAV") total return per share of 10.7% for the year. |
| - | Share price total return per share of 17.9% for the year. |
| - | Dividends paid and declared in respect of the financial year in review total 19.00 pence per share. Cumulative dividends paid stand at 128.20 pence per share. |
| - | £4.48 million was invested into five new growth capital investments and one existing portfolio company during the year. |
| - | A total of £8.14 million of cash proceeds was received, primarily consisting of £5.90 million from three realisations. |
| The longer-term trend of performance on this measure is shown in the table below: |
| Reporting date as at 31 December | Net assets | NAV per share | Cumulative dividends paid per share | Cumulative total return per share to shareholders (NAV basis)1 |
| (£m) | (p) | (p) | (p) | |
| 2019 | 50.04 | 74.901 | 124.201 | 199.101 |
| 2018 | 57.90 | 84.79 | 105.20 | 189.99 |
| 2017 | 58.41 | 86.57 | 101.20 | 187.77 |
| 2016 | 52.76 | 107.57 | 73.20 | 180.77 |
| 2015 | 57.01 | 117.89 | 62.20 | 180.09 |
| 1 | These figures exclude the impact of a dividend of 4.00 pence per share paid after the year-end on 10 January 2020. Payment of these dividends will reduce the Company's NAV per share and increase cumulative dividends paid to date by 4.00 pence per share. |
| CHAIRMAN'S STATEMENT I am pleased to present the annual results of Mobeus Income & Growth 4 VCT plc for the year ended 31 December 2019. Overview The Company has made significant progress in all areas this year. New investments, realisations of investments and valuations of the existing portfolio can all report positive developments. The Company has made investments into five new companies, provided follow-on funding to one existing portfolio company and has realised its holdings in three portfolio companies, including the Company's first profitable exit of a younger growth capital investment. Furthermore, after the year-end, the Company achieved its most successful exit to date, Auction Technology Group. At the time of writing there remains significant uncertainty with regard to the lasting effects on the world economy of COVID-19 although it is clear that UK economic growth will reduce this year. Further information is contained within the Outlook, the Investment Adviser's Review, and Note 10 - Post Balance Sheet Events. Further details of the investment activity can be found under the 'Investment portfolio' section of my Statement and in the Investment Adviser's Review. Mobeus Equity Partners LLP, ("the Investment Adviser"), continues to report an attractive pipeline of further growth capital opportunities. Meanwhile, the former MBO portfolio constructed under the previous rules continues to provide a healthy income yield, although the absolute amount of that yield earned by the Company is declining as these investments are sold. Only growth capital investments are allowed under the 2015 VCT rules, so they are replacing the MBO investments that are no longer permitted. As the growth capital investments are in younger businesses, they are unlikely to deliver the income yields of the more mature MBO businesses. We are delighted with the strong support from investors for our recent fundraising, which was launched on 25 October 2019 and became fully subscribed in January 2020. The Board appreciates the continued support from existing Shareholders and extends a warm welcome to new Shareholders. Performance The Company's NAV total return per share for the year was a commendable 10.7% (2018: 2.6%) (being the closing NAV plus dividends paid in the year, divided by the opening NAV), while the share price total return was 17.9% (2018: 4.6%). This total NAV return was primarily attributable to strong gains in the value of the portfolio of investee companies, the profitable exit of MBO investments, The Plastic Surgeon and ASL, and growth capital investment, Redline Worldwide. The Company's NAV at 31 December 2019 was 74.90 pence. After the year-end, the Company realised its holding in Pattern Analytics Limited (trading as Biosite) generating an overall return of 1.5x the original cost. Shortly afterwards, Turner Topco Limited (trading as Auction Technology Group), an MBO portfolio company, was realised generating a very high overall return of 4.5x the original cost. After allowing for tax on the income portion of proceeds, this sale represents the best realisation since the Company's inception, at an uplift in isolation of 2.63 pence over the 31 December 2019 NAV per share of 74.90 pence. Further information is contained in the Investment Adviser's Review. For more information on the longer-term performance of your investment in the Company, please consult the Investor Performance Index on the Company's website www.mig4vct.co.uk. Investment portfolio The portfolio was valued at £38.54 million (2018: £36.30 million) at the year-end representing 109.1% of cost (2018: 98.4%). During the year, £4.48 million was invested in five new growth capital investments and one existing portfolio company (analysed in the Investment Adviser's Review and explained within Note [x] to the Financial Statements). The five new growth capital investments, at a cost of £4.03 million, are: · Arkk Consulting, a regulatory and reporting requirement service provider; · Parsley Box, home delivered, ambient ready meals for the elderly; · Active Navigation, a provider of enterprise-level file analysis software; · IPV, a developer of media asset management software; and · Bleach, an established and trusted brand in the hair colourants market. In addition, one follow-on growth investment totalling £0.45 million was made into MPB Group, an online marketplace for used camera and video equipment; We expect follow-on investments to continue to be a feature of the growth capital investments as they require further capital to achieve scale. After the year-end, £0.62 million was invested into Bella & Duke Limited, a premium frozen raw dog food provider. Shareholders should note that, at the year-end, 38.0% by value of the investment portfolio was held in MBO type investments and 62.0% was held in growth capital investments. £17.77 million has been invested in growth capital investments since the 2015 VCT rule changes. Cash proceeds totalling £8.14 million for the year were received from portfolio companies that were either sold, repaid loans or settled other capital proceeds. Of this total, £5.90 million was received as cash proceeds from the sales of The Plastic Surgeon, ASL and Redline. Proceeds of £0.39 million were received from the partial realisation of Master Removers, and a further £1.85 million was received as loan repayments and consideration arising from companies sold in the previous year. For the year under review, the portfolio generated a net gain of £2.31 million on investments realised. Within this, the principal gains were from the Plastic Surgeon, ASL and Redline sales (which were realised at a profit over opening valuations of £0.39 million, £1.08 million and £0.54 million respectively). Redline was the first growth capital investment to be realised profitably. Further gains of £0.30 million were achieved by the receipt of proceeds relating to Entanet, an investment sold in a previous year, as well as the partial exit from Master Removers Group. The portfolio also achieved a net increase in unrealised valuations of £3.36 million for the year on investments still held, with positive increases from Auction Technology Group (subsequently realised as noted below), MPB Group and Proactive partially offset by valuation falls at Wetsuit Outlet, Supercarers and Master Removers Group. After the year-end, the Company realised its holding in Pattern Analytics Limited (trading as Biosite), another of its growth capital investments. The Company received £1.98 million in cash from the sale and generated a return on original cost of 1.5x in the three years that this investment was held. These proceeds were the same as the value of this investment held at the year-end. Also after the year-end, the Company achieved a substantial gain over cost upon the sale of Auction Technology Group, receiving capital proceeds of £4.18 million compared to a value at the year-end of £3.03 million. This further appreciation in capital value of £1.15 million upon sale reflects the strategic premium paid by the acquirer of the business. The Company also received interest owed on completion of £1.09 million that has not been recognised in these 2019 accounts. Over the 11.5 years' life of the investment, total proceeds of £9.03 million have been received, an overall multiple over cost of 4.5x and an IRR of 29%. These transactions and valuation movements are explained further in the Investment Review. Dividends Your Board has declared and paid three interim dividends in respect of the year ended 31 December 2019 of 13.00, 2.00 and 4.00 pence paid on 20 September 2019, 30 December 2019 and 10 January 2020, respectively. The dividends paid in respect of the year ended 31 December 2019 of 19.00 pence per share (2018: 8.00 pence) per share, bring cumulative dividends paid since inception to 128.20 pence (2018: 109.20 pence) per share. The Company's target of paying a dividend of at least 4.00 pence per share in respect of each financial year has been achieved in each of the last nine years, and often exceeded. Whilst the Board still believes this dividend target is attainable, it should be noted that the move of the portfolio to an increased proportion of younger growth capital investments may lead to increased volatility, which could offset the return in any one year. A chart showing the dividends paid in respect of each of the last five years and cumulative dividends on the same basis is included in the Strategic Report. A full dividend history is contained in the Performance Overview on the Company's website: www.mobeus.co.uk/investor-area/vct-investors On 2 April 2020, the Board declared a 6.00 pence per share interim dividend in respect of the year ending 31 December 2020 which will be payable on 7 May 2020 to Shareholders on the Register on 14 April 2020. Dividend investment scheme As announced on 14 August 2018, the Board decided to suspend the Company's Dividend Investment Scheme ("the Scheme") and since this date all dividends have been paid in cash. The Scheme had historically been considered a practical and cost effective way for the Company to retain cash for investment and operating purposes. However, as both current and projected liquidity levels were deemed to be sufficient over the medium-term, the Board considered in August 2018 that the Scheme should be suspended. Following a further review, the Board believes that it would be beneficial for the Company and for Shareholders for the Scheme to be reinstated as of the close of the Company's Annual General Meeting on 2 June 2020. From this date onwards, all those participants who remain registered on the Scheme will have any of their future dividends automatically reinvested to purchase new shares in the Company at the latest announced per share NAV price. Shareholders can view the details of the Scheme and opt-in or out by visiting www.mig4vct.co.uk or contacting vcts@linkgroup.co.uk with any queries. As part of the Board's consideration in recommencing the Scheme, it has carried out a review of the Scheme terms and conditions ("Scheme Rules"). The Board has decided to amend the Scheme Rules so that any new shares will be issued at the latest published NAV per share, as is current market practice, rather than as previously, at the higher of 70% of NAV per share or the mid-market price per share which, in practice, resulted in shares being issued at an effective discount to NAV of around 10%. In addition, there are a number of other technical, regulatory and clarificatory changes being made to the Scheme Rules. These changes will apply to new participants from today and from the close of the Company's Annual General Meeting on 2 June 2020 in respect of existing participants. All existing Scheme participants will be notified of the changes and given the opportunity to remain or withdraw from the Scheme. Any Shareholders not currently participants of the Scheme may visit www.mig4vct.co.uk and sign up to the Scheme or existing members can opt-out. Fundraising On 25 October 2019, the Company launched an offer for subscription of £8 million with an over-allotment facility of an additional £5 million, alongside offers from the other Mobeus advised VCTs. I am pleased to report that the Offer experienced strong demand such that the Company received subscriptions amounting to the full amount sought shortly after the Company's year-end in January 2020. In accordance with the Offer's prospectus, the first allotment under the Offer took place on 8 January 2020, which included all applications received up to 20 December 2019 totalling £10.67 million. The balance of subscriptions of £2.33 million were allotted before the end of the tax year on 2 April 2020. Share buybacks On 1 August 2019, the Board changed its share buyback policy objective of maintaining the discount to NAV at which the Company's shares may trade in the market from approximately 10% or less, to approximately 5% or less. This change has in part contributed to the share price total return of 17.9%, and was made to reflect current industry practice. During the year, the Company made five purchases of its shares, buying back a total of 1,483,865 shares. The buybacks represented 2.2% (2018: 1.7%) of the issued share capital of the Company at the beginning of the year. Further details are included in the Annual Report. The shares bought back were subsequently cancelled. Shareholder Communications This year's annual Shareholder event was held on Tuesday, 4 February 2020 at the National Gallery in central London. Separate daytime and evening sessions included presentations on the Mobeus advised VCTs' investment activity and performance. We have received positive feedback from many of the circa 400 people who attended the event and were pleased to hear that overall they found the day informative and worthwhile. Environmental, Social and Governance (ESG) Your Board would like to assure Shareholders that it is taking these issues seriously, and future annual reports will be covering them in more detail. Further reporting and procedural requirements for these increasingly important issues required by current and future regulation should enable the Board to provide concise information and implement further processes, both relevant to the Company and correspondingly useful to stakeholders. These objectives do require that regulations are measured, proportionate and cost effective to introduce. Fraud Warning Boiler Room fraud and unsolicited communications to Shareholders. We have been made aware of an increase in the number of Shareholders being contacted in connection with sophisticated but fraudulent financial scams which purport to come from the Company or to be authorised by it. This is often by a phone call or an email usually originating from outside of the UK, often claiming or appearing to be from a corporate finance firm and typically offering to buy your VCT shares at an inflated price. Further information on boiler room scams and fraud advice plus who to contact, can be found first in the answer to a question "What should I do if I receive an unsolicited offer for my shares?" within the VCT Investor area of the Investment Adviser's website in the A Guide to VCTs section: www.mobeus.co.uk/investor-area and secondly, in a link to the FCA's ScamSmart site: www.fca.org.uk/ scamsmart We strongly recommend that you seek financial advice before taking any action if you remain in any doubt. You can also contact the Investment Adviser on 0207 024 7600, or email info@mobeus.co.uk to check whether any claims made by a caller are genuine. Shareholders are also encouraged to ensure their personal data is always held securely and that data held by the Registrars of the Company is up to date, to avoid cases of identity fraud. Annual General Meeting The next Annual General Meeting of the Company will be held at 11:30 am. on Tuesday, 2 June 2020 at The Clubhouse, 8 St James's Square, London SW1Y 4JU. However, this is subject to Government advice and the impact of COVID-19 to allow physical meetings of two or more people currently prohibited under the Stay at Home Measures. It is likely that these measures will still be in place at the time of the AGM and Shareholders will not be allowed to attend the AGM meeting in person. The Board encourages Shareholders to submit their vote by proxy either by completing and returning the form enclosed or proxy votes may also be submitted electronically via the Link Shareholder Portal www.signalshares. com. Shareholders are also advised to appoint the Chairman of the Meeting as their proxy as another nominated proxy may not be able to attend the meeting. Any updates will be announced to the London Stock Exchange and on the website: www.migvct.co.uk which Shareholders intending to attend should consult. Shareholders are encouraged to return their proxy forms to submit their vote either by completing and returning the proxy form enclosed or electronically via the Registrar's Shareholder portal at: www. signalshares.com. The Notice of the meeting is included towards the end of the Annual Report and an explanation of the resolutions to be proposed can be found in the Directors' Report, also within the Annual Report. Outlook The market sectors in which the Company operates have been very active. There has been considerable competition for good propositions, so entry pricing has been an issue in some cases. With regard to the UK generally the arrival of a government with a clear majority and a more focused view on Brexit, and on other important issues, is a clear positive. On the other hand, the effects of the COVID-19 outbreak and its recent impact on world economies generally and the UK specifically cannot, as at this date, be fully assessed either from a duration or severity point of view. However, it has already proved itself to be an event of major significance for all economic activity.The Board and the Investment Adviser will need to assess the consequences carefully and will be working through these issues as they arise. Further details can be found in the Investment Adviser's Review of this report. I draw Shareholders' attention to the announcement of an unaudited NAV at 24 March 2020 of 64.16 pence per share made on 26 March 2020. While the short-term outlook for the UK economy is unpredictable, your Board considers that your Company is well positioned, with a portfolio still including some relatively mature investments providing an income return and an increasing proportion of younger, growth capital companies seeking to achieve scale. The strong result achieved for the year reflects the growth and valuation increases in both elements of the portfolio, underpinned by three profitable realisations. It is particularly pleasing to report the Company's first profitable realisation of a portfolio company investment made since the VCT rule change in 2015 and a second after the year-end. Your Board again cautions that investing in growth capital investments in younger businesses involves increased risk and that returns from them may take longer to emerge and may be more volatile. Shareholders should expect these companies to take time to achieve their desired objectives and scale, but there also exists the potential for significant gains in some cases. The successful fundraising in 2019/20 provides the Company with adequate funds to meet its cash needs (bolstered by the sales of Biosite and Auction Technology Group) and to continue the current investment rate in the short to medium-term. Recent developments are likely to make the next 1-2 years more difficult, but will also provide opportunities that should benefit the longer term. The Board As mentioned in my statement last year, the issue of Board refreshment continues. Graham Paterson was appointed to the Board on 10 May 2019. He also took over the roles of Chairman of the Audit Committee, and of the Nomination and Remuneration Committee. Christopher Burke was appointed to the Board on 26 November 2019. Christopher has enjoyed a very successful career in the technology sector, and his advice will be an important additional asset to the Board as the proportion of the portfolio invested in younger growth capital businesses increases. I shall be stepping down as Chairman later this year. A recruitment process is progressing well in identifying my successor. I joined the Board of the Company in 2002. At that time the Company was suffering from very poor performance by two of its managers, and as a result was sub scale and unloved by the market. The management arrangements were changed and over the years performance has moved from being fourth quartile to climbing towards first quartile, and the Fund was built up to an economic size. My thanks go to all the Mobeus team, and to all the Company's hard working Directors for putting up with me for so long. I am sure they will deliver good results for Shareholders in the future. Finally, I would like to take this opportunity once again to thank all Shareholders for their continued support. Christopher Moore Chairman |
| INVESTMENT POLICY The Company invests primarily in a diverse portfolio of UK unquoted companies. Investments are made selectively across a number of sectors, principally in established companies. Investments are usually structured as part loan stock and part equity in order to produce a regular income stream and to generate capital gains from realisations. There are a number of conditions within the VCT legislation which need to be met by the Company and which may change from time to time. The Company will seek to make investments in accordance with the requirements of prevailing VCT legislation. Asset allocation and risk diversification policies, including the size and type of investments the Company makes, are determined in part by the requirements of prevailing VCT legislation. No single investment may represent more than 15% (by VCT tax value) of the Company's total investments at the date of investment. The Company's cash and liquid funds are held in a portfolio of readily realisable interest bearing investments, deposit and current accounts, of varying maturities, subject to the overriding criterion that the risk of loss of capital be minimised. The Company's Articles of Association permit borrowings of amounts up to 10% of the adjusted capital and reserves (as defined therein). However, the Company has never borrowed and the Board would only consider doing so in exceptional circumstances. Investment ADVISER'S Review COVID-19 update after the year-end After the year-end, the world has been in the midst of a COVID-19 pandemic. Many of the VCTs' portfolio companies are encountering very challenging trading conditions, the full extent and impact of which will emerge only over time. The Investment Adviser has reviewed and evaluated the impact of COVID-19 on each sector exposure and upon the value of the portfolio. The Investment Adviser is fully engaged with the portfolio companies to ensure that all steps are being taken to assist each to trade through this crisis and restore and grow value thereafter. As part of this, Mobeus is reviewing the implications for new and follow-on investments with the recent fundraising and relatively high liquidity levels providing a solid foundation for such assessments. Mobeus continually reviews a significant pipeline of investment opportunities. Only the companies with sufficient potential will be taken towards investment. It is expected that the current pace and quantum of new and follow-on investments will continue in the short to medium-term. Nonetheless the extent of the negative impact of the COVID-19 pandemic upon the UK and world economy cannot yet be fully evaluated. Mobeus is carefully assessing possible consequences, both for each investee company and their implications for new and follow-on investment. Portfolio review The portfolio's activity in the year is summarised as follows:
This has been a year of good progress building the growth capital portfolio with five investments into new growth businesses totalling £4.03 million, and one existing growth portfolio company receiving follow-on funding of £0.45 million, and net cash proceeds received of £8.14 million, primarily from three realisations. This brings the total invested in growth capital investments to £17.77 million since the introduction of the VCT regulations in 2015. The past year's investment and divestment activity has increased the proportion of the portfolio regarded as growth capital investments by value to 62.0% (including AIM and legacy) at the year-end. After the year-end, £0.62 million was invested in Bella & Duke Limited, a premium frozen raw dog food provider. Detail of these movements for each investee company are provided in the Investment Portfolio Summary at the end of this Investment Review. As mentioned in the Chairman's Statement, investing in growth capital investments in younger businesses does involve increased risk. Returns from these companies are expected to take longer to materialise and may be more volatile. The portfolio's contribution to the overall results of the Company is summarised in the table in the next column as follows:
Valuation changes of portfolio investments still held Within the net valuation increases of £5.30 million, the principal contributors were: Auction Technology Group - £1.77 million, MPB Group - £0.85 million and Proactive Group - £0.84 million. Auction Technology Group, which the Company part realised in 2014, traded well ahead of budget with growth showing in all areas of its business. The sale of this business after the year-end concluded an 11½ year partnership with the Company. MPB Group has grown its revenues substantially. In July, it secured £9.00 million of further investment at a higher valuation, of which the Company contributed £0.45 million of a total of £2.00 million that was provided by the Mobeus VCTs. A small number of new growth investments (such as Proactive Group) have shown initial uplifts from cost, due in large part to the structure of the Company's investment, but, in some cases, also due to the underlying investee company performance. Proactive Group has made consistent positive progress in all its markets since investment. The principal driver of the value increase over the period however is the preference structure of the investment which allocates a greater share of economic value to the Company at the current stage of the business' development. Within total valuation decreases of £(1.94) million, the main reductions were: Wetsuit Outlet - £(0.64) million, Supercarers - £(0.36) million and Master Removers Group - £(0.28) million. Wetsuit Outlet continues to disappoint post investment, although it is anticipated that measures recently implemented to restore margins will soon begin to improve profitability. Supercarers is performing well behind plan and in response is undertaking a restructure of its cost base. Finally, whilst Master Removers Group remains very profitable and cash generative, Brexit uncertainties over the last few months has impacted recent performance. Realised gains and losses from sales of investments The Company achieved net realised gains on the sale of investments of £2.31 million over their value at the start of the year mainly comprising three significant and profitable exits. In May, the Company realised its long held investment in Plastic Surgeon generating a gain in the year of £0.39 million which contributed to a multiple of cost over the life of the investment of 5.6x. Shortly afterwards, in June, ASL Technology Group was sold generating a gain in the year of £1.08 million and, including all proceeds received since investment, an overall multiple of cost of 2.2x. In December, the Company realised its first growth capital investment made under the new VCT rules, Redline Worldwide, generating a gain of £0.54 million in the year. Over the period that this investment was held, a multiple of 1.6x cost has been achieved to date with further proceeds potentially payable in due course. £0.06 million of these proceeds were received following the year-end, bringing the multiple on cost achieved to 1.7x. Finally, the Company achieved a gain of £0.27 million arising from the disposal of Entanet in 2017, increasing the final return on cost to 2.8x, while the partial realisation of Master Removers Group during the year generated a gain of £0.03 million. After the year-end, in February, the Company exited investments held in Pattern Analytics (trading as Biosite) and Auction Technology Group ("ATG"). Pattern Analytics (trading as Biosite) was realised generating proceeds of £2.07 million over the life of the investment and an overall gain over original cost of 1.5x. The realisation of ATG has generated proceeds over the life of the investment of £9.03 million compared to an original cost of £2.00 million, a multiple on cost of 4.5x over the 11½ years this investment was held - an exceptional return for Shareholders. Investment portfolio yield and capital repayments During the year under review, the Company received the following amounts in interest and dividend income:
The Company also received loan stock repayments of £1.35 million, at cost. New investment in the year A total of £4.03 million was invested into five new investments during the year as detailed below: |
| Company | Business | Date of investment | Amount of new investment (£m) | |
| Parsley Box | Home delivered, ambient ready meals for the elderly | May 2019 | 0.67 | |
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| Arkk Consulting | Regulatory and reporting requirement service provider | May 2019 | 1.12 | |
| Arkk Consulting (trading as Arkk Solutions) provides services and software to enable organisations to remain compliant with regulatory reporting requirements. Arkk was established in 2009 and currently has over 800 clients across 20 countries. These include more than 80 of the FTSE 350, and half of the largest 20 accountancy firms in the UK. The investment will build on Arkk's reputation and customer base, to target the cloud-based period end reporting market by building the sales and marketing team. The company's audited accounts for the year ended 31 December 2018 show turnover of £3.36 million and a loss before interest, tax and amortisation of goodwill of £(0.34) million. | ||||
| Active Navigation | File analysis software | November 2019 | 1.10 | |
| Data Discovery Solutions, trading as Active Navigation, is a file analysis software solution which makes it easier for companies to clean up network drives, respond to new data protection laws and dispose of redundant and out dated documents. Active Navigation's solution is used by significant blue chip customers, particularly those in highly regulated industries such as energy and professional services, as well as government entities in the USA, Canada, Australia and the UK. Active Navigation will seek to drive continued growth from its file analysis platform with the recruitment of experienced sales and professional services staff. The company's audited accounts for the year ended 30 June 2018 show revenues of £5.02 million and a profit before interest, tax and amortisation of goodwill of £1.45 million. | ||||
| IPV | Media asset software | November 2019 | 0.62 | |
| IPV Limited ("IPV") has developed a media asset management software product called 'Curator', enabling enterprise level customers to receive and search hours of video footage, edit into multiple short clips and broadcast to online video platforms (such as YouTube) and company intranets, in a very short time. IPV's impressive list of blue-chip clients, such as Turner Sports, NASA and Sky, are looking to improve efficiency in managing their video content. The company has built an impressive senior management team of proven operators and is targeting a media asset management market in the US and UK, worth an estimated £1 billion per annum. The investment will be used to build out a sales and marketing team and to fund lead generation for new direct and partner channels as well as supporting the existing partner network. The company's audited accounts for the year ended 31 December 2018 show revenues of £2.25 million and a loss before interest, tax and amortisation of goodwill of £(1.28) million. | ||||
| Bleach | Hair colourants brand | December 2019 | 0.52 | |
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| The Company made a further investment totalling £0.45 million into one existing portfolio company during the year under review, as detailed below: |
| Company | Business | Date of investment | Amount of new investment (£m) |
| MPB Group | Online marketplace for used camera and video equipment | July 2019 | 0.45 |
| MPB Group is Europe's leading online marketplace for used camera and video equipment. Based in Brighton, its custom-designed pricing technology enables MPB Group to offer both buy and sell services through the same platform and offers a one-stop shop for all its customers. Having expanded into the US (opening a New York office) and German markets as part of the initial VCT investment round, this follow-on investment, alongside funds provided by two other third-party investors, is to support its continued growth plan. As it has more than doubled its sales over the last two years, this investment will also help drive the company's objective to create a £100m+ turnover internationally diverse and profitable re-commerce business. The company's audited accounts for the year ended 31 March 2019 show turnover of £31.91 million and a loss before interest, tax and amortisation of goodwill of £(1.73) million. | |||
| The Company realised its investments in ASL, Plastic Surgeon and Redline during the year, generating an aggregated net realised gain for the year of £2.01 million. Net cash proceeds received from the sale of these investments totalled £5.90 million, as detailed below: |
| Company | Business | Period of investment | Total cash proceeds over the life of the investment/ Multiple over cost |
| Plastic Surgeon | Supplier of snagging and finishing services to the property sector | April 2008 to May 2019 | £2.56 million 5.6 x cost |
| The Company sold its remaining investment in Plastic Surgeon to Polygon Group for £1.44 million (realised gain in the year: £0.39 million), including a preference share repayment of £0.06 million in January 2019. Over the eleven years this investment was held, it generated proceeds of £2.56 million compared to an original investment cost of £0.46 million which is a multiple on cost of 5.6x and an IRR of 20.5%. | |||
| ASL Technology | Printer and photocopier services | December 2010 to June 2019 | £4.22 million 2.2 x cost |
| The Company sold its investment in ASL Technology for £3.40 million (realised gain in the year: £1.08 million). Over the eight and a half years this investment was held, it generated proceeds of £4.22 million compared to an original investment cost of £1.93 million, which is a multiple on cost of 2.2x and an IRR of 12.6%. | |||
| Redline | Provider of security services to the aviation industry and other sectors | February 2016 to December 2019 | £1.37 million 1.6x cost |
| The Company sold its investment in Redline Worldwide for £1.06 million (realised gain in the year: £0.54 million). Since investment in 2016, the investment has generated proceeds to date of £1.37 million compared to an original investment cost of £0.84 million, which is a multiple on cost to date of 1.6x and an IRR of 16.0%. Further proceeds may be receivable in due course. | |||
| Company | Business | Period of investment | Total cash proceeds over the life of the investment/ Multiple over cost |
| Biosite | Workforce management and security services | November 2016 to February 2020 | £2.07 million 1.5 x cost |
| The Company sold its investment in Pattern Analytics Limited (trading as Biosite) to ASSA ABLOY for £1.98 million. Since investment in 2016, the investment has generated proceeds of £2.07 million compared to an original investment cost of £1.34 million, which is a multiple on cost of 1.5x and an IRR of 21.0%. | |||
| Auction Technology Group | SaaS based online auction marketplace platform | October 2008 to February 2020 | £9.03 million 4.5 x cost |
| The Company sold its investment in Turner Topco Limited (trading as Auction Technology Group) to TA Associates for £5.27 million (including £1.09 million loan interest due on completion). This investment generated proceeds over the life of the investment of £9.03 million (including proceeds received following a partial realisation from a sale to ECI Partners in June 2014) compared to an original cost of £2.00 million, which is a multiple on cost of 4.5x and an IRR of 28.9%. | |||
| Company | Business | Date of investment | Amount of new investment (£) |
| Bella & Duke | Premium frozen raw dog food provider | February 2020 | 0.62 |
| Bella & Duke is a direct to consumer subscription service, providing premium frozen raw dog food to pet owners in the UK. Founded in 2016, the business provides an alternative to standard meal options for dogs by focusing on the well documented health benefits of a raw food diet. This area is a growing niche in the large and established pet food market and is being driven by the premiumisation of dog food. The investment will seek to optimise its production and supply facilities, expand and enhance its team and develop alternative products (such as cat food). The company's unaudited accounts for the year ended 31 March 2019 show revenues of £2.68 million and a loss before interest, tax and amortisation of goodwill of £(0.61) million. | |||
| % of | % of | ||||
| Cost at | Valuation at | Valuation at | equity | portfolio | |
| 31-Dec-19 | 31-Dec-18 | 31-Dec-19 | held | by value | |
| £ | £ | £ | |||
| Mobeus Equity Partners Portfolio | |||||
| Tovey Management Limited (trading as Access IS) | 2,469,013 | 3,013,724 | 3,571,056 | 9.7% | 9.3% |
| Provider of data capture and scanning hardware | |||||
| Turner Topco Limited (trading as Auction Technology Group) | 1,529,075 | 1,255,082 | 3,029,777 | 3.5% | 7.9% |
| SaaS based online auction marketplace platform | |||||
| MPB Group Limited | 1,480,993 | 1,402,016 | 2,701,332 | 5.3% | 7.0% |
| Online marketplace for used photographic equipment | |||||
| Virgin Wines Holding Company Limited | 1,930,813 | 2,372,306 | 2,475,731 | 9.7% | 6.4% |
| Online wine retailer | |||||
| EOTH Limited (trading as Equip Outdoor Technologies) | 951,471 | 1,976,902 | 2,148,792 | 1.7% | 5.6% |
| Distributor of branded outdoor equipment and clothing (Rab and Lowe Alpine) | |||||
| Preservica Limited | 1,585,773 | 2,082,403 | 2,043,873 | 11.0% | 5.3% |
| Seller of proprietary digital archiving software | |||||
| Pattern Analytics Limited (trading as Biosite) | 1,338,539 | 1,978,710 | 1,978,710 | 5.6% | 5.1% |
| Workforce management and security services for the construction industry | |||||
| Proactive Group Holdings Inc | 755,340 | 1,060,873 | 1,900,421 | 2.6% | 4.9% |
| Provider of media services and investor conferences for companies primarily listed on secondary public markets | |||||
| Media Business Insight Holdings Limited | 2,722,760 | 1,871,714 | 1,893,907 | 15.7% | 4.9% |
| A publishing and events business focused on the creative production industries | |||||
| CGI Creative Graphics International Limited | 1,449,746 | 1,439,959 | 1,344,908 | 6.3% | 3.5% |
| Vinyl graphics to global automotive, recreation vehicle and aerospace markets | |||||
| Vian Marketing Limited (trading as Red Paddle Co) | 899,074 | 1,378,902 | 1,337,175 | 7.1% | 3.5% |
| Design, manufacture and sale of stand-up paddleboards and windsurfing sails | |||||
| My Tutorweb Limited | 1,307,644 | 1,307,644 | 1,307,644 | 7.2% | 3.4% |
| Digital marketplace connecting school pupils seeking one-to-one online tutoring | |||||
| Ibericos Etc. Limited (trading as Tapas Revolution) | 1,044,869 | 1,135,102 | 1,274,306 | 5.8% | 3.3% |
| Spanish restaurant chain | |||||
| Arkk Consulting Limited | 1,118,490 | - | 1,142,351 | 7.5% | 3.0% |
| Provider of services and software to enable organisations to remain compliant with regulatory reporting requirements | |||||
| Tharstern Group Limited | 1,091,886 | 1,070,871 | 1,106,429 | 12.2% | 2.9% |
| MIS & Commercial print software solutions | |||||
| Data Discovery Solutions Limited (trading as Active Navigation) | 1,100,500 | - | 1,100,500 | 6.3% | 2.9% |
| Provider of global market leading file analysis software for information governance, security and compliance | |||||
| Manufacturing Services Investment Limited (trading as Wetsuit Outlet) | 2,333,102 | 1,651,280 | 1,015,878 | 6.4% | 2.6% |
| Online retailer in the water sports market | |||||
| Buster and Punch Holdings Limited | 530,392 | 687,347 | 925,639 | 4.5% | 2.4% |
| Industrial inspired lighting and interiors retailer | |||||
| Rota Geek Limited | 437,000 | 685,092 | 816,619 | 3.7% | 2.1% |
| Workforce management software | |||||
| Master Removers Group 2019 Limited (formerly Master Removers Group Limited) (trading as Anthony Ward Thomas, Bishopsgate and Aussie Man & Van) | 348,641 | 1,426,419 | 785,346 | 7.2% | 2.0% |
| A specialist logistics, storage and removals business | |||||
| Parsley Box Limited | 668,400 | - | 704,359 | 4.9% | 1.8% |
| Supplier of home delivered, ambient ready meals for the elderly | |||||
| IPV Limited | 619,487 | - | 619,487 | 5.5% | 1.6% |
| Provider of media asset software | |||||
| Bourn Bioscience Limited | 1,132,521 | 687,046 | 606,708 | 7.7% | 1.6% |
| Management of In-vitro fertilisation clinics | |||||
| Vectair Holdings Limited | 24,732 | 360,155 | 522,139 | 2.1% | 1.4% |
| Designer and distributor of washroom products | |||||
| Bleach London Holdings Limited | 519,672 | - | 519,672 | 3.4% | 1.3% |
| Hair colourants brand | |||||
| Kudos Innovations Limited | 328,950 | 328,950 | 515,372 | 3.2% | 1.3% |
| Online platform that provides and promotes academic research dissemination | |||||
| RDL Corporation Limited | 1,000,000 | 478,719 | 293,708 | 9.1% | 0.8% |
| Recruitment consultants for the pharmaceutical and IT industries | |||||
| Blaze Signs Holdings Limited | 190,631 | 286,967 | 291,039 | 5.7% | 0.8% |
| Manufacturer and installer of signs | |||||
| Omega Diagnostics Group plc2 | 200,028 | 208,344 | 233,345 | 1.1% | 0.6% |
| In-vitro diagnostics for food intolerance, auto-immune diseases and infectious diseases | |||||
| Jablite Holdings Limited | 376,083 | 122,422 | 94,021 | 9.1% | 0.2% |
| Manufacturer of expanded polystyrene products | |||||
| BG Training Limited | 10,625 | 5,313 | 5,313 | 0.0% | 0.0% |
| City-based provider of specialist technical training | |||||
| Supercarers Limited | 485,730 | 364,298 | - | 4.3% | 0.0% |
| Online platform that connects people seeking care home from experienced independent carers | |||||
| BookingTek Limited | 652,137 | 163,034 | - | 3.5% | 0.0% |
| Software for hotel groups | |||||
| Veritek Global Holdings Limited | 1,620,086 | 9,953 | - | 11.9% | 0.0% |
| Maintenance of imaging equipment | |||||
| Racoon International Group Limited | 484,347 | - | - | 8.0% | 0.0% |
| Supplier of hair extensions, hair care products and training | |||||
| CB Imports Group Limited (trading as Country Baskets) | 175,000 | - | - | 5.8% | 0.0% |
| Importer and distributor of artificial flowers, floral sundries and home décor products | |||||
| H Realisations (2018) Limited (formerly Hemmels Limited) (in liquidation) | 23,250 | - | - | 0.0% | 0.0% |
| Company specialising in sourcing, selling and servicing of high price classic cars | |||||
| Disposals in year | |||||
| ASL Technology Holdings Limited | - | 2,327,966 | - | 0.0% | 0.0% |
| Printer and photocopier services | |||||
| The Plastic Surgeon Holdings Limited | - | 1,046,666 | - | 0.0% | 0.0% |
| Snagging and finishing of domestic and commercial properties | |||||
| Redline Worldwide Limited | - | 521,616 | - | 0.0% | 0.0% |
| Provider of security services to the aviation industry and other sectors | |||||
| Hollydale Management Limited (dissolved) | - | 438,200 | - | 0.0% | 0.0% |
| Company seeking to carry on a business in the food sector | |||||
| Backhouse Management Limited (dissolved) | - | 226,800 | - | 0.0% | 0.0% |
| Company seeking to carry on a business in the motor sector | |||||
| Creasy Marketing Services Limited (dissolved) | - | 226,800 | - | 0.0% | 0.0% |
| Company seeking to carry on a business in the textile sector | |||||
| McGrigor Management Limited (dissolved) | - | 226,800 | - | 0.0% | 0.0% |
| Company seeking to carry on a business in the pharmaceutical sector | |||||
| Barham Consulting Limited (dissolved) | - | 226,800 | - | 0.0% | 0.0% |
| Company seeking to carry on a business in the catering sector | |||||
| Total | 34,936,800 | 36,053,195 | 38,305,557 | 99.4% | |
| Former Elderstreet Private Equity Portfolio | |||||
| Cashfac Limited | 260,101 | 245,465 | 232,724 | 2.9% | 0.6% |
| Provider of virtual banking application software solutions to corporate customers | |||||
| Sift Group Limited | 135,391 | - | - | 1.3% | 0.0% |
| Developer of business-to-business internet communities | |||||
| Total | 395,492 | 245,465 | 232,724 | 0.6% | |
| Total Investment Portfolio | 35,332,292 | 36,298,660 | 38,538,281 | 100.0% | |
| Total Investment Portfolio split by type | |||||
| Growth focused portfolio⁵ | 20,257,495 | 19,291,443 | 23,910,253 | 62.0% | |
| MBO focused portfolio⁵ | 15,074,797 | 17,007,217 | 14,628,028 | 38.0% |
| Principal risks, management and regulatory environment The Directors acknowledge the Board's responsibilities for the Company's internal control systems and have instigated systems and procedures for identifying, evaluating and managing the significant risks faced by the Company. This includes a key risk management review which takes place at each quarterly board meeting. Further details of these are contained in the corporate governance section of the Directors' Report in the Annual Report. The principal risks identified by the Board are set out below:
STATEMENT OF DIRECTORS' RESPONSIBILITIES The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law and regulations. Company law requires the Directors to prepare Financial Statements for each financial year and the Directors have elected to prepare the Financial Statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the Directors must not approve the Financial Statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss for the Company for that period. In preparing these financial statements, the Directors are required to:
Website publication The Directors are responsible for ensuring the Annual Report and the Financial Statements are made available on a website. Financial Statements are published on the Company's website in accordance with legislation in the United Kingdom governing the preparation and dissemination of Financial Statements, which may vary from legislation in other jurisdictions. The maintenance and integrity of the Company's website is the responsibility of the Directors. The Directors' responsibility also extends to the ongoing integrity of the Financial Statements contained therein. Directors' responsibilities pursuant to Disclosure and Transparency Rule 4 of the UK Listing Authority The Directors confirm to the best of their knowledge that: (a) The Financial Statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice, give a true and fair view of the assets, liabilities, financial position and the profit of the Company. (b) The Annual Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces. Having taken advice from the Audit Committee, the Board considers the Annual Report and Financial Statements, taken as a whole, as fair, balanced and understandable and that it provides the information necessary for shareholders to assess the Company's performance, business model and strategy. Neither the Company nor the Directors accept any liability to any person in relation to the Annual Report except to the extent that such liability could arise under English law. Accordingly, any liability to a person who has demonstrated reliance on any untrue or misleading statement or omission shall be determined in accordance with section 90A and schedule 10A of the Financial Services and Markets Act 2000. The names and functions of the Directors are stated in the Annual Report. For and on behalf of the Board: Christopher Moore Chairman |
| Income Statement for the year ended 31 December 2019 | |||||||||
| Year ended 31 December 2019 | Year ended 31 December 2018 | ||||||||
| Notes | Revenue | Capital | Total | Revenue | Capital | Total | |||
| £ | £ | £ | £ | £ | £ | ||||
| Net investment portfolio gains | 8 | - | 5,675,164 | 5,675,164 | - | 930,576 | 930,576 | ||
| Income | 3 | 2,107,357 | - | 2,107,357 | 2,263,918 | - | 2,263,918 | ||
| Investment Adviser's fees | 4a | (309,641) | (928,923) | (1,238,564) | (311,111) | (933,333) | (1,244,444) | ||
| Other expenses | 4d | (451,261) | - | (451,261) | (378,431) | - | (378,431) | ||
| Profit/(loss) on ordinary activities before | |||||||||
| taxation | 1,346,455 | 4,746,241 | 6,092,696 | 1,574,376 | (2,757) | 1,571,619 | |||
| Taxation on profit/(loss) on ordinary activities | 5 | (211,879) | 176,496 | (35,383) | (243,837) | 177,334 | (66,503) | ||
| Profit for the year and total comprehensive | |||||||||
| income | 1,134,576 | 4,922,737 | 6,057,313 | 1,330,539 | 174,577 | 1,505,116 | |||
| Basic and diluted earnings per ordinary share | 6 | 1.67p | 7.28p | 8.95p | 1.95p | 0.25p | 2.20p | ||
| Balance Sheet as at 31 December 2019 | Company No. 03707697 | |||||
| 31 December 2019 | 31 December 2018 | |||||
| Fixed assets | Notes | £ | £ | |||
| Investments at fair value | 8 | 38,538,281 | 36,298,660 | |||
| Current assets | ||||||
| Debtors and prepayments | 183,175 | 529,190 | ||||
| Current investments | 9 | 8,928,456 | 18,830,389 | |||
| Cash at bank | 9 | 2,627,511 | 2,541,058 | |||
| 11,739,142 | 21,900,637 | |||||
| Creditors: amounts falling due within one year | (242,109) | (303,513) | ||||
| Net current assets | 11,497,033 | 21,597,124 | ||||
| Net assets | 50,035,314 | 57,895,784 | ||||
| Capital and reserves | ||||||
| Called up share capital | 667,991 | 682,830 | ||||
| Share premium reserve | - | 31,474,977 | ||||
| Capital redemption reserve | 8,056 | 26,257 | ||||
| Revaluation reserve | 3,713,586 | 1,848,472 | ||||
| Special distributable reserve | 35,514,889 | 14,784,518 | ||||
| Realised capital reserve | 8,935,662 | 6,815,730 | ||||
| Revenue reserve | 1,195,130 | 2,263,000 | ||||
| Equity shareholders' funds | 50,035,314 | 57,895,784 | ||||
| Basic and diluted net asset value per ordinary share | 74.90p | 84.79p | ||||
| Non-distributable reserves | Distributable reserves | |||||||||||
| Called up | Share | Capital | Special | Realised | Revenue | |||||||
| share | premium | redemption | Revaluation | distributable | capital | reserve | ||||||
| Notes | capital | reserve | reserve | reserve | reserve | reserve | Total | |||||
| (note a) | (note b) | (note b) | ||||||||||
| £ | £ | £ | £ | £ | £ | £ | £ | |||||
| At 1 January 2019 | 682,830 | 31,474,977 | 26,257 | 1,848,472 | 14,784,518 | 6,815,730 | 2,263,000 | 57,895,784 | ||||
| Comprehensive | ||||||||||||
| income for the year | ||||||||||||
| Profit for the year | - | - | - | 3,362,520 | - | 1,560,217 | 1,134,576 | 6,057,313 | ||||
| Total comprehensive | ||||||||||||
| income for the year | - | - | - | 3,362,520 | - | 1,560,217 | 1,134,576 | 6,057,313 | ||||
| Contributions by and | ||||||||||||
| distributions to owners | ||||||||||||
| Shares bought back | ||||||||||||
| (note c) | (14,839) | - | 14,839 | - | (1,071,326) | - | - | (1,071,326) | ||||
| Dividends paid | 7 | - | - | - | - | (8,953,893) | (1,690,118) | (2,202,446) | (12,846,457) | |||
| Total contributions | ||||||||||||
| by and distributions | ||||||||||||
| to owners | (14,839) | - | 14,839 | - | (10,025,219) | (1,690,118) | (2,202,446) | (13,917,783) | ||||
| Other movements | ||||||||||||
| Cancellation of Share | ||||||||||||
| premium reserve | ||||||||||||
| (note d) | - | (31,474,977) | (33,040) | - | 31,508,017 | - | - | - | ||||
| Realised losses | ||||||||||||
| transferred to special | ||||||||||||
| reserve (note a) | - | - | - | - | (752,427) | 752,427 | - | - | ||||
| Realisation of | ||||||||||||
| previously unrealised | ||||||||||||
| appreciation | - | - | - | (1,497,406) | - | 1,497,406 | - | - | ||||
| Total other movements | - | (31,474,977) | (33,040) | (1,497,406) | 30,755,590 | 2,249,833 | - | - | ||||
| At 31 December 2019 | 667,991 | - | 8,056 | 3,713,586 | 35,514,889 | 8,935,662 | 1,195,130 | 50,035,314 | ||||
| Non-distributable reserves | Distributable reserves | ||||||||||
| Called up | Share | Capital | Special | Realised | Revenue | ||||||
| share | premium | redemption | Revaluation | distributable | capital | reserve | |||||
| capital | reserve | reserve | reserve | reserve | reserve | Total | |||||
| £ | £ | £ | £ | £ | £ | £ | £ | ||||
| At 1 January 2018 | 674,751 29,895,865 | 14,589 | 517,952 | 20,029,787 | 6,346,235 | 932,461 | 58,411,640 | ||||
| Comprehensive | |||||||||||
| income for the year | |||||||||||
| Profit/(loss) for the year | - | - | - | 1,294,148 | - | (1,119,571) | 1,330,539 | 1,505,116 | |||
| Total comprehensive | |||||||||||
| income for the year | - | - | - | 1,294,148 | - | (1,119,571) | 1,330,539 | 1,505,116 | |||
| Contributions by and | |||||||||||
| distributions to owners | |||||||||||
| Shares issued via Offer for | |||||||||||
| Subscription | 11,862 | 1,003,505 | - | - | (10,787) | - | 1,004,580 | ||||
| Dividends re-invested | |||||||||||
| into new shares | 7,885 | 575,607 | - | - | - | - | 583,492 | ||||
| Shares bought back | (11,668) | - | 11,668 | - | (874,700) | - | (874,700) | ||||
| Dividends paid | - | - | - | - | (2,734,344) | - | - | (2,734,344) | |||
| Total contributions | |||||||||||
| by and distributions | |||||||||||
| to owners | 8,079 | 1,579,112 | 11,668 | - | (3,619,831) | - | - | (2,020,972) | |||
| Other movements | |||||||||||
| Realised losses | |||||||||||
| transferred to special | |||||||||||
| reserve | - | - | - | - | (1,625,438) | 1,625,438 | - | - | |||
| Realisation of previously | |||||||||||
| unrealised depreciation | - | - | - | 36,372 | - | (36,372) | - | - | |||
| Total other movements | - | - | - | 36,372 | (1,625,438) | 1,589,066 | - | - | |||
| At 31 December 2018 | 682,830 | 31,474,977 | 26,257 | 1,848,472 | 14,784,518 | 6,815,730 | 2,263,000 | 57,895,784 | |||
| Year ended | Year ended | ||||||
| Notes | 31 December 2019 | 31 December 2018 | |||||
| £ | £ | ||||||
| Cash flows from operating activities | |||||||
| Profit for the financial | year | 6,057,313 | 1,505,116 | ||||
| Adjustments for: | |||||||
| Net investment portfolio gains | (5,675,164) | (930,576) | |||||
| Tax charge for the current year | 35,383 | 66,503 | |||||
| Decrease in debtors | 120,121 | 104,935 | |||||
| Increase/(decrease) in creditors | 33,245 | (35,677) | |||||
| Net cash inflow from | operations | 570,898 | 710,301 | ||||
| Corporation tax paid | (66,529) | (117,456) | |||||
| Net cash inflow from | operating | activities | 504,369 | 592,845 | |||
| Cash flows from investing activities | |||||||
| Sale of investments | 8 | 8,136,792 | 4,531,646 | ||||
| Purchase of investments | 8 | (4,475,355) | (5,882,806) | ||||
| Net cash inflow/(outflow) from investing activities | 3,661,437 | (1,351,160) | |||||
| Cash flows from financing activities | |||||||
| Shares issued as part of Offer for | Subscription | - | 1,042,499 | ||||
| Issue costs as part of Offer for Subscription | - | (37,919) | |||||
| Equity dividends paid | 7 | (12,846,457) | (2,150,852) | ||||
| Purchase of own shares | (1,134,829) | (1,066,736) | |||||
| Net cash outflow from financing | activities | (13,981,286) | (2,213,008) | ||||
| Net decrease in cash and cash equivalents | (9,815,480) | (2,971,323) | |||||
| Cash and cash equivalents at start of year | 19,371,447 | 22,342,770 | |||||
| Cash and cash equivalents at end of year | 9,555,967 | 19,371,447 | |||||
| Cash and cash equivalents comprise: | |||||||
| Cash at bank and in hand | 9 | 2,627,511 | 2,541,058 | ||||
| Cash equivalents | 9 | 6,928,456 | 16,830,389 | ||||
| 2019 | 2018 | ||||
| £ | £ | ||||
| Income from bank deposits | 40,298 | 34,179 | |||
| Income from investments | |||||
| - from equities | 243,975 | 290,937 | |||
| - from OEIC funds | 106,151 | 101,193 | |||
| - from loan stock | 1,714,938 | 1,824,903 | |||
| - from interest on preference share dividend arrears | 1,995 | 11,061 | |||
| 2,067,059 | 2,228,094 | ||||
| Other income | - | 1,645 | |||
| Total income | 2,107,357 | 2,263,918 | |||
| Total income comprises | |||||
| Dividends | 350,126 | 392,130 | |||
| Interest | 1,757,231 | 1,870,143 | |||
| Other income | - | 1,645 | |||
| 2,107,357 | 2,263,918 | ||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||
| 2019 | 2019 | 2019 | 2018 | 2018 | 2018 | |||
| £ | £ | £ | £ | £ | £ | |||
| Mobeus Equity Partners LLP | 309,641 | 928,923 | 1,238,564 | 311,111 | 933,333 | 1,244,444 | ||
| 2019 | 2018 | ||||
| £m | £m | ||||
| Funds raised by the Company | - | 1.04 | |||
| Offer costs payable to Mobeus at 3.25% of funds raised by the Company | - | 0.03 | |||
| 2019 | 2018 | ||||
| £ | £ | ||||
| Directors' remuneration (including NIC of £9,733 (2018: £9,099) (note i) | 114,686 | 105,349 | |||
| IFA trail commission | 60,201 | 61,863 | |||
| Broker's fees | 12,000 | 12,000 | |||
| Auditor's fees - Audit of Company (excluding VAT) | 27,932 | 24,088 | |||
| - audit related assurance services (excluding VAT) - note ii) | 5,638 | 4,613 | |||
| - tax compliance services (excluding VAT) note ii) | 1,845 | 1,922 | |||
| Registrar's fees | 47,668 | 39,252 | |||
| Printing | 48,530 | 48,085 | |||
| Legal & professional fees | 24,831 | 10,590 | |||
| VCT monitoring fees | 9,600 | 9,600 | |||
| Directors' insurance | 7,921 | 7,631 | |||
| Listing and regulatory fees | 29,230 | 38,874 | |||
| Sundry | 61,179 | 14,564 | |||
| Other expenses | 451,261 | 378,431 | |||
| 2019 | 2019 | 2019 | 2018 | 2018 | 2018 | |||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||
| £ | £ | £ | £ | £ | £ | |||||
| a) Analysis of tax charge: | ||||||||||
| UK Corporation tax on profits/(losses) for | ||||||||||
| the year | 211,879 | (176,496) | 35,383 | 243,837 | (177,334) | 66,503 | ||||
| Total current tax charge | 211,879 | (176,496) | 35,383 | 243,837 | (177,334) | 66,503 | ||||
| Corporation tax is based on a rate of 19% | ||||||||||
| (2018: 19%) | ||||||||||
| b) Profit/(loss) | on ordinary activities | |||||||||
| before tax | 1,346,455 | 4,746,241 | 6,092,696 | 1,574,376 | (2,757) | 1,571,619 | ||||
| Profit/(loss) on | ordinary activities multiplied | |||||||||
| by company rate of corporation tax in the | ||||||||||
| UK of 19% (2018: 19%) | 255,826 | 901,786 | 1,157,612 | 299,131 | (523) | 298,608 | ||||
| Effect of: | ||||||||||
| UK dividends not taxable | (46,355) | - | (46,355) | (55,278) | - | (55,278) | ||||
| Net investment portfolio gains not taxable | - | (1,078,282) | (1,078,282) | - | (176,811) | (176,811) | ||||
| Overprovision in prior period | - | - | - | (26) | - | (26) | ||||
| Expenditure not allowable for tax | ||||||||||
| purposes | 2,408 | - | 2,408 | 10 | - | 10 | ||||
| Actual tax charge | 211,879 | (176,496) | 35,383 | 243,837 | (177,334) | 66,503 | ||||
| 2019 | 2018 | ||||
| £ | £ | ||||
| Total earnings after taxation: | 6,057,313 | 1,505,116 | |||
| Basic and diluted earnings per share (note a) | 8.95p | 2.20p | |||
| Net revenue from ordinary activities after taxation | 1,134,576 | 1,330,539 | |||
| Basic and diluted revenue earnings per share (note b) | 1.67p | 1.95p | |||
| Net investment portfolio gains | 5,675,164 | 930,576 | |||
| Capital expenses (net of taxation) | (752,427) | (755,999) | |||
| Total capital return | 4,922,737 | 174,577 | |||
| Basic and diluted capital earnings per share (note c) | 7.28p | 0.25p | |||
| Weighted average number of shares in issue in the year | 67,649,790 | 68,499,583 | |||
| For year ended | Pence | 2019 | 2018 | ||||||
| Dividend | Type | 31 December | per share | Date Paid | £ | £ | |||
| Interim | Capital* | 2018 | 4.00p | 19/06/2018 | - | 2,734,344 | |||
| Final | Income | 2018 | 1.75p | 28/05/2019 | 1,188,375 | - | |||
| Final | Capital* | 2018 | 2.25p | 28/05/2019 | 1,527,911 | - | |||
| Interim | Income | 2019 | 1.50p | 20/09/2019 | 1,014,071 | - | |||
| Interim | Capital | 2019 | 2.50p | 20/09/2019 | 1,690,118 | - | |||
| Interim | Capital* | 2019 | 9.00p | 20/09/2019 | 6,084,426 | - | |||
| Interim | Capital* | 2019 | 2.00p | 30/12/2019 | 1,341,556 | - | |||
| 12,846,457 | 2,734,344** | ||||||||
| For year ended | Pence | 2019 | 2018 | ||||||
| Type | 31 December | per share | Date Payable | £ | £ | ||||
| Final | Income | 2018 | 1.75p | 28/05/2019 | - | 1,188,375 | |||
| Final | Capital* | 2018 | 2.25p | 28/05/2019 | - | 1,527,911 | |||
| Interim | Capital* | 2019 | 4.00p | 10/01/2020 | 2,671,965 | - | |||
| 2,671,965 | 2,716,286 | ||||||||
| For year ended | Pence | 2019 | 2018 | |||||
| Dividend | Type | 31-Dec | per share | Date paid/payable | £ | £ | ||
| Revenue available for distribution by way of dividends for the year | 1,134,576 | 1,330,539 | ||||||
| Final | Income | 2018 | 1.75p | 28/05/2019 | - | 1,188,375 | ||
| Interim | Income | 2019 | 1.50p | 20/09/2019 | 1,014,071 | - | ||
| Total income dividends for the year | 1,014,071 | 1,188,375 | ||||||
| Traded on | Unquoted | Unquoted | Unquoted | Total | |
| AIM | equity shares | preference | Loan stock | ||
| £ | shares | ||||
| £ | £ | £ | |||
| £ | |||||
| Cost at 31 December 2018 | 200,028 | 16,903,109 | 13,382 | 19,786,223 | 36,902,742 |
| Unrealised gains at 31 December 2018 | 8,316 | 1,048,683 | 326,001 | 239,578 | 1,622,578 |
| Permanent impairment in value of investments as at | |||||
| 31 December 2018 | - | (2,139,022) | - | (87,638) | (2,226,660) |
| Valuation at 31 December 2018 | 208,344 | 15,812,770 | 339,383 | 19,938,163 | 36,298,660 |
| Purchases at cost | - | 4,475,355 | - | - | 4,475,355 |
| Sale proceeds (Note a) | - | (3,749,886) | (328,654) | (4,058,252) | (8,136,792) |
| Net realised gains in the year | - | 2,060,376 | - | 252,268 | 2,312,644 |
| Unrealised gains in the year (Note b) | 25,001 | 3,204,319 | - | 359,094 | 3,588,414 |
| Valuation at 31 December 2019 | 233,345 | 21,802,934 | 10,729 | 16,491,273 | 38,538,281 |
| Cost at 31 December 2019 | 200,028 | 18,299,196 | 12,871 | 16,820,197 | 35,332,292 |
| Unrealised gains/(losses) at 31 December 2019 | 33,317 | 3,923,697 | (2,142) | (241,286) | 3,713,586 |
| Permanent impairment in value of investments at | |||||
| 31 December 2019 (Note c) | - | (419,959) | - | (87,638) | (507,597) |
| Valuation at 31 December 2019 | 233,345 | 21,802,934 | 10,729 | 16,491,273 | 38,538,281 |
| Company | Type | Investment | Disposal | Valuation at | Realised |
| cost | proceeds | 31 December | gain in year | ||
| 2018 | |||||
| £ | £ | £ | £ | ||
| ASL Technology Holdings Limited | Realisation | 1,933,591 | 3,403,138 | 2,327,966 | 1,075,172 |
| The Plastic Surgeon Holdings Limited | Realisation | 46,160 | 1,435,184 | 1,046,666 | 388,518 |
| Redline Worldwide Limited | Realisation | 838,377 | 1,064,768 | 521,616 | 543,152 |
| Entanet Holdings Limited | Contingent Consideration | - | 501,987 | - | 276,093 |
| Master Removers Group 2019 Limited | Part Realisation | 163,214 | 386,315 | 356,606 | 29,709 |
| Backhouse Management Limited | Realisation | 589,680 | 226,800 | 226,800 | - |
| Barham Consulting Limited | Realisation | 589,680 | 226,800 | 226,800 | - |
| Creasy Marketing Services Limited | Realisation | 589,680 | 226,800 | 226,800 | - |
| Hollydale Management Limited | Realisation | 701,120 | 438,200 | 438,200 | - |
| McGrigor Management Limited | Realisation | 589,680 | 226,800 | 226,800 | - |
| Newquay Helicopters (2013) Limited | Realisation | 4,623 | - | - | - |
| 6,045,805 | 8,136,792 | 5,598,254 | 2,312,644 | ||
| 2019 | 2018 | |||||
| £ | £ | |||||
| OEIC Money market funds | 6,928,456 | 16,830,389 | ||||
| Cash equivalents per Statement of Cash Flows | 6,928,456 | 16,830,389 | ||||
| Bank deposits that mature after three months | 2,000,000 | 2,000,000 | ||||
| Current asset investments | 8,928,456 | 18,830,389 | ||||
| Cash at bank | 2,627,511 | 2,541,058 | ||||
| 31 December 2019 | 24 March 2020 | % | |
| NAV per share | 70.90 pence1 | 64.16 pence | (9.5)% |