REG-New Century AIM VCT Plc Annual Financial Report
30/06/2022 07:00
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Annual Financial Report
Company number: 05352611
New Century AIM VCT plc
28(th) February 2022
Audited Report and Accounts for the year to 28(th) February 2022
Financial Summary 1
Chairman's Statement 2
Details of Directors 3
Management and Administration 4
Directors 5
Strategic Report 6
Investment Portfolio 8
Top Ten Investments 12
Directors' Report 13
Directors’ Remuneration Report 17
Corporate Governance 19
Independent Auditor's Report 23
Statement of Comprehensive Income 31
Balance Sheet 32
Statement of Changes in Equity 33
Cash Flow Statement 34
Notes to the Financial Statements 35 - 46
Shareholder Information 47
Financial Summary
Year ended Year ended
28 February 28 February
2022 2021
(0.33) (0.47)
Revenue return per share (pence) for the year
1.53 38.49
Total return per share (pence) for the year
- 1.50
Interim dividend paid per share (pence)
2.0 6.50
Proposed final dividend per share (pence)
97.99 102.96
Net asset value per share (pence)
133.31 131.78
Cumulative value of shareholder investment (net asset value plus cumulative
dividends paid per share) (pence)
7,703 8,094
Shareholders’ funds (£’000)
Chairman’s Statement
I am pleased to be taking over as your new Chairman to ensure that the Company
carries out your wishes.
The Board is aware that there has been deep dissatisfaction by a majority of
shareholders at the disappointing long term performance of the fund. The Board
is also aware of how difficult it can be to sell shares in the company and how
the shares are usually priced at a large discount to their net asset value.
Shareholders are also disadvantaged by the wide spread between the buying and
selling price. This dissatisfaction was demonstrated in August 2021 when 70.3%
of shareholders voting, voted against the AGM motion to continue with the
fund. As a result, a General Meeting was held in December 2021, to vote on
whether or not to wind up the company. At this meeting 71.93% of the
shareholders that voted were in favour of winding up the company. In order to
wind up the company, a 75% majority is required. Such was the strength of
opposition to wind up the company, former New Century Aim VCT chairman, John
Brice, wrote to shareholders, pointing out the dismal performance of the fund
and with my backing, put forward a motion to remove the rest of the Board. The
remaining Board members felt that they no longer represented the wishes of the
majority of the company’s shareholders and consequently, in January, 2022,
decided to resign. The following month, John Brice and Simon Bragg joined me
as directors of the company. The new Board stated that it was their intention
to focus on ways to enhance shareholder value.
As mentioned in the investment manager’s report, the fund, after adding in
all the dividends, has only increased by 33.31% over just over 17 years. This
dismal performance has continued, with the net asset value falling to 88.73p
per share as at the 31 May 2022. Adding in the cumulative dividends, the
overall gain since March 2005 has only been 24.05%. Adjusting for the discount
to net asset value and the dealing spread, that gain would be greatly trimmed
back for sellers of the shares – that is if they could actually sell them.
Bearing in mind the above factors and the substantial number of shareholders
that wished the fund to close, the Board has listened to the Company’s
shareholders and decided that the best way to maximise shareholders’ returns
would be to return as much value to shareholders as possible. With this in
mind, the Board approached its legal advisors to seek advice on the best way
to achieve this. Following these discussions, the Board decided that the most
efficient and cost effective way to do this would be to realise funds in a
sensible and controlled fashion and distribute these to shareholders in a
succession of dividends. With this in mind, the Board recently requested the
investment manager to refrain from buying and to realise investments to enable
the payment of a large initial interim dividend. Several sales have since
taken place while maintaining VCT qualifying status. Many shareholders will be
aware of the recent weakness of the UK market and in particular the AIM
market. Consideration will be given to the prevailing market conditions when
winding down the fund. With this in mind, the directors will hold off selling
if they feel that it is an unfavourable time for disposing of the investments.
With the recent sales that have taken place, we have raised enough to pay a
9.0p per share dividend which we intend to pay as an interim dividend for the
year ended 28 February 2023. This interim dividend will have an ex-dividend
date of 7 July, a record date of 8 July and a payment date of 22 July.
Distribution of this cash will result in the level of qualifying investments
increasing well above the 80% level at which it remains qualifying. The Board
also proposes to pay a final dividend of 2.0p per share for the year ended 28
February 2022, subject to shareholders approval at the AGM. If approved, this
dividend will have an ex-dividend date of 15 August, a record date of the 19
August and a payment date of 2 September 2022.
Another situation which the directors are dealing with is the appointment of
new auditors. Our current auditors, UHY have informed us of their change in
strategy and the sectors in which they operate and have consequently notified
us of their intention to not seek reappointment as auditors when the current
audit of the fund has been completed. The directors are actively seeking
suitable auditors to replace them. Oberon has also announced its decision to
resign as bookkeepers to the fund and we are currently looking for a
replacement.
Michael Barnard
Chairman
29 June 2022
Details of Directors
Michael Barnard (Aged 71)
Michael has been employed in stockbroking since 1971. In 1974 he became a
Member of the Stock Exchange. During his career his duties have spanned
investment advising, investment research, dealing and company management. In
1988 he started his own stockbroking company, MD Barnard & Company Limited
which he subsequently sold on 30 November 2017.
John Brice (Aged 60)
Following a 30-year career in the asset management industry John Brice now
runs his family office network of companies. Previously he was President,
Chief Investment Officer and co-founder of CarVal Investors LLC a leading
alternative asset manager involved in special situation, distressed and
opportunistic investment. Under his leadership the firm grew to manage over
$10bn of capital on behalf of leading global institutional investors and
sovereign wealth funds, consistently producing top quartile returns and
recognised as one of Wall St’s leading firms in its space as a result. He
was responsible for pioneering this type of investment in Europe having led
restructurings in a number of prominent European companies including Marconi
PLC and British Energy PLC in the UK. He has extensive experience in the
private equity and hedge fund fields. He is a qualified chartered accountant
and holds a B.Sc. in Economics from Cardiff University.
Simon Bragg (Aged 58)
Simon is Founder and Chief Executive of JSB Energy Partners Limited. He was
formerly Chairman and Chief Executive of Stifel Europe. Stifel acquired Oriel
Securities in 2014, which he founded and launched in 2002. Prior to this role,
Simon worked at HSBC Investment Bank, Cargill Financial Markets and Hoare
Govett. He has over twenty years' experience in financial services, helping
companies and investors to be successful. He is a non-executive director of
Intralink Group Limited and was a director and Audit Committee Chairman of JP
Morgan American Investment Trust PLC. Simon graduated from Imperial College,
London with a degree in Chemistry and qualified as a Chartered Accountant with
Peat Marwick Mitchell (KPMG).
Geoffrey Gamble (Aged 63)
Geoffrey started his career with National Westminster Bank plc. He joined
Publishing Holdings plc in 1984 and became a director in 1986. He took part in
an MBO in 1988, backed by Schroder Ventures (now Permira) to form Charterhouse
Communications Group Limited and was instrumental in the satisfactory venture
capital exit from that company and its flotation on AIM in 1996. He became
managing director of Charterhouse Communications plc in 1999.
Peter William Riley (Aged 77)
Peter qualified as a solicitor in 1969. He retired from practice in 2018.
Ian Cameron-Mowat (Aged 71)
Ian has a BSc 1st degree in electronics and was involved in the early
development of computers at Burroughs Machines. He is currently a consultant
radiologist to a NHS Trust.
Simon Like (Aged 52)
Simon started his career working for Midland Bank, which later became HSBC
plc, and has been employed in stockbroking since 2001. Since then Simon has
been managing client money and is one of the senior fund managers at Oberon
Investments Limited.
Management and Administration
Registered Office & Registered Number 4(th) Floor,
50 Mark Lane
London
EC3R 7QR
Company Number: 05352611
Company Secretary Tricor Secretaries Limited
4(th) Floor,
50 Mark Lane
London
EC3R 7QR
Registrar Neville Registrars Limited
Neville House
Steelpark Road
Halesowen
B62 8HD
Solicitors Dickson Minto
Broadgate Tower
20 Primrose Street
London
EC2A 2EW
Investment Manager and Broker Oberon Investments Limited
1st Floor
12 Hornsby Square
Southfields Business Park
Basildon
Essex
SS15 6SD
Auditor UHY Hacker Young LLP
Quadrant House
4 Thomas More Square
London
E1W 1YW
Directors
The following people were directors of the Company during its financial year
ending 28 February 2022:
Michael David Barnard (Chairman)
John Brice (appointed 10 February 2022)
Simon Bragg (appointed 10 February 2022)
Geoffrey Gamble (resigned 28 January 2022)
Simon Like (resigned 28 January 2022)
Peter Riley (resigned 28 January 2022)
Ian Cameron-Mowat (resigned 28 January 2022)
All directors are non-executive.
Audit Committee:
Simon Bragg (Chairman)
John Brice
Strategic Report
Activities and status
The principal activity of the Company during the year was the making of
long-term equity and loan investments in UK Listed, AIM traded and unquoted
companies in the United Kingdom. The Company has been listed on the London
Stock Exchange since 25 March 2005 and has been granted approval by Her
Majesty’s Customs & Revenue as a Venture Capital Trust. The Chairman’s
Statement on page 2 and the Investment Manager’s Review below give a review
of developments during the year and of future prospects.
The directors consider that the Company was not at any time up to the date of
this report a close company within the meaning of Section 414 of the Act.
Investment Manager’s Review
The AIM All Share index had a mixed performance throughout the year. It
started positively and reached a high in September 2021, but then declined
throughout the remainder of 2021 and in January and February 2022 it declined
more sharply as investors became nervous of rising fuel costs, difficulties
within many supply chains, rising inflation and interest rates and the Russian
invasion of the Ukraine.
During the year to 28th February 2022 the net asset value (NAV) of your fund
declined by 4.83% to 97.99p, compared to the AIM All Share index which fell
12.73% over the same period. The net asset value of the fund plus cumulative
dividends per share increased by 1.16%.
The fund made nine qualifying investments in the period, investing in Arecor
Therapeutics plc, Belluscura plc, Clean Power Hydrogen plc, Libertine Holdings
plc, Lunglife AI Inc., Strip Tinning Holdings plc, Sulnox Group plc, Trellus
Health plc and Truspine Technologies plc.
We made nine sales during the year where we either exited or top-sliced a
holding, plus there were two takeovers of our investments and a significant
share buy back in another.
The current year has started with continued volatility, as the macro-economic
environment has become more challenging over the past 4 months. Your fund
remains invested across a variety of sectors to help try and smooth out some
of this volatility.
Investment Objective
New Century AIM VCT PLC is a Venture Capital Trust (“VCT”) established
under the legislation introduced in the Finance Act 1995. The Company’s
principal objectives as set out in the prospectus are to achieve long term
capital growth through investment in a diversified portfolio of Qualifying
Companies primarily quoted on AIM.
Principal risks and uncertainties
The Company invests its funds primarily in companies traded on AIM, which
entail a higher degree of risk than investments in large listed companies. The
main risk, therefore, arising from the Company’s activities is market price
risk, representing the uncertain realisable values of the Company’s
investments. Please refer to the Corporate Governance report on page 19 which
provides evidence of the robust review the directors have performed to assess
these risks, and also note 22 to these accounts which gives a detailed review
of the Company’s risk management.
Environmental matters
Discussion in respect of environmental matters is not considered relevant or
material to an understanding of the performance of the Company. The Company
does not consider that Greenhouse Gas Emissions disclosure is relevant to the
Company on the grounds of immateriality due to its not having its own premises
or employees.
Key performance indicators
The financial key performance indicators are set out in the financial summary
on page 1.
Viability Statement
In accordance with provision 1 of The UK Corporate Governance Code 2018 the
directors have assessed the prospects of the Company over a longer period than
the 12 months required by the “Going Concern” provision.
The Board regularly considers the Company’s strategy, including investor
demand for the Company’s shares, and a three year period is therefore
considered to be an appropriate and reasonable time horizon.
The Board has carried out a robust assessment of the principal risks facing
the Company and its current position, including those which may adversely
impact its business model, future performance, solvency or liquidity. The
principal risks faced by the Company and the procedures in place to monitor
and mitigate them are set out in note 22.
The Board has also considered the Company’s cash flow projections and found
these to be realistic and reasonable.
Based on the above assessment the Board confirms that it has a reasonable
expectation that the Company will be able to continue in operation and meet
its liabilities as they fall due over the three year period to 28 February
2025.
Michael Barnard
Chairman 29 June 2022
Investment Portfolio
Security Original Valuation at Cost Valuation
Cost
28 Feb’22
£ £ % %
Qualifying Investments 6,568,422 7,075,679 88.38 92.13
Non-qualifying Investments 507,733 248,037 6.83 3.23
7,076,155 7,323,716 95.21 95.36
Uninvested funds 356,250 356,250 4.79 4.64
7,432,405 7,679,966 100.00 100.00
Qualifying Investments
AIM quoted
Abingdon Health plc 35,218 4,088 0.47 0.05
Access Intelligence plc 10,053 27,000 0.14 0.35
Actual Experience plc 63,174 7,782 0.85 0.10
AFC Energy plc 50,254 114,219 0.68 1.49
Angle plc 119,347 143,048 1.61 1.86
Anglo African Oil & Gas plc 45,229 0 0.61 0.00
Arecor Therapeutics plc 12,816 21,041 0.17 0.27
Audioboom Group plc 121,167 1,070,910 1.63 13.94
Bango plc 7,563 32,375 0.10 0.42
Belluscura plc 100,506 239,444 1.35 3.12
Belvoir Lettings plc 23,320 46,800 0.31 0.61
Bigblu Broadband plc 163,569 198,718 2.20 2.59
Blackbird plc 96,735 369,600 1.30 4.81
Brighton Pier Group plc 50,253 24,375 0.68 0.32
C4X Discovery Holding plc 65,329 127,617 0.88 1.66
Clean Power Hydrogen plc 50,253 66,444 0.68 0.87
Cloudbuy plc 58,483 228 0.79 0.00
Coral Products plc 118,095 120,833 1.59 1.57
Creo Medical Group plc 30,053 51,145 0.40 0.67
Cyanconnode Holdings plc 376,755 87,901 5.07 1.14
DCD Media plc 562,800 1,564 7.57 0.02
Deepmatter Group plc 49,754 7,260 0.67 0.09
Deepverge plc 121,304 57,453 1.63 0.75
Destiny Pharma plc 50,254 53,846 0.68 0.70
Diaceutics plc 10,314 13,500 0.14 0.18
DP Poland plc 20,113 7,337 0.27 0.10
Ecsc Group plc 20,104 23,455 0.27 0.31
Eden Research plc 30,152 30,000 0.41 0.39
Falanx Group Ltd 150,964 63,324 2.03 0.82
Faron Pharmaceuticals Ltd 25,128 24,950 0.34 0.32
Feedback plc 100,508 59,042 1.35 0.77
Fusion Antibodies plc 12,064 9,640 0.16 0.13
Gear4Music Holdings plc 27,121 91,246 0.36 1.19
Gfinity plc 116,218 116,594 1.56 1.52
IDE Group Holdings plc 52,763 1,050 0.71 0.01
Ideagen plc 28,430 186,352 0.38 2.43
Security Original Valuation at Cost Valuation
Cost
28 Feb’22
£ £ % %
Immotion Group plc 130,661 87,037 1.76 1.13
I-Nexus Global plc 70,353 5,520 0.95 0.07
Inspired Energy plc 51,370 265,571 0.69 3.46
Intelligent Ultrasound Group plc 170,848 145,313 2.30 1.89
K3 Business Technology Group plc 90,360 169,830 1.22 2.21
Keywords Studios plc 5,563 108,540 0.07 1.41
Kinovo plc 156,673 109,658 2.11 1.43
Libertine Holdings plc 75,378 112,500 1.01 1.46
Lightwaverf plc 45,233 2,647 0.61 0.03
Location Sciences Group plc 132,946 13,939 1.79 0.18
Lunglife AI Inc 20,102 20,453 0.27 0.27
M.Winkworth plc 64,320 155,200 0.87 2.02
Marechale Capital plc 133,828 34,450 1.80 0.45
Maxcyte Inc 25,128 156,784 0.34 2.04
Microsaic Systems plc 154,711 3,507 2.08 0.05
Mirriad Advertising plc 30,154 13,838 0.41 0.18
Myhealthchecked plc 200,550 180,306 2.70 2.35
N4 Pharma plc 60,304 14,070 0.81 0.18
Pelatro plc 25,128 9,160 0.34 0.12
PHSC plc 182,910 85,050 2.46 1.11
Polarean Imaging plc 30,154 109,600 0.41 1.43
Property Franchise Group plc 212,312 599,420 2.86 7.80
Quixant plc 6,935 19,200 0.09 0.25
Rosslyn Data plc 27,037 2,608 0.36 0.03
Scancell Holdings plc 130,618 113,901 1.76 1.48
Scholium Group plc 50,253 18,650 0.68 0.24
SEEEN plc 150,754 63,333 2.03 0.82
Solid State plc 40,134 185,625 0.54 2.42
SRT Marine Systems plc 4,523 10,850 0.06 0.14
Strip Tinning plc 15,890 14,441 0.21 0.19
Sysgroup plc 99,177 40,784 1.33 0.53
Touchstar plc 281,400 87,500 3.79 1.14
TP Group plc 109,278 19,571 1.47 0.25
Trellus Health plc 25,128 17,500 0.34 0.23
Tristel plc 28,651 245,156 0.39 3.19
ULS Technology plc 48,241 91,200 0.65 1.19
Verici Dx plc 35,178 68,250 0.47 0.89
Vianet Group plc 40,175 27,950 0.54 0.36
XP Factory plc 31,006 6,032 0.42 0.08
Yourgene Health plc 69,349 28,463 0.93 0.37
Yu Group plc 27,893 36,225 0.38 0.47
Total AIM quoted qualifying investments 6,266,768 6,999,814 84.32 91.14
Security Original Valuation at Cost Valuation
Cost
28 Feb’22
£ £ % %
AQSE Quoted qualifying Investments
Sulnox Group plc 35,279 40,365 0.47 0.53
Truspine Technologies plc 50,253 35,500 0.68 0.46
85,532 75,865 1.15 0.99
Unlisted qualifying investments
Invocas Group plc 100,400 0 1.35 0.00
Outsourcery plc 45,027 0 0.61 0.00
Optare plc 50,753 0 0.68 0.00
Syqic plc 19,943 0 0.27 0.00
216,122 0 2.91 0.00
Total qualifying investments 6,568,422 7,075,679 88.38 92.13
Non-qualifying investments
AIM Quoted
Audioboom Group plc 1,163 2,190 0.02 0.03
Bango plc 291 370 0.00 0.00
Cyanconnode Holdings plc 131 15 0.00 0.00
Driver Group plc 8,992 3,980 0.12 0.05
Gateley Holdings plc 14,627 27,450 0.20 0.36
IDE Group Holdings plc 218 1 0.00 0.00
K3 Business Technology Group plc 131 170 0.00 0.00
Rotala plc 60,796 41,250 0.82 0.54
Tristel plc 60 334 0.00 0.00
86,409 75,760 1.16 0.99
UK Listed
Aviva plc 22,268 20,985 0.30 0.27
Cizzle Biotechnology Holdings plc 35,179 70 0.47 0.00
Imperial Brands plc 23,763 16,385 0.32 0.21
Investec plc 202,821 113,688 2.73 1.49
Twentyfour Income Fund Ltd 9,852 8,960 0.13 0.12
Vodafone Group plc 20,590 12,189 0.28 0.16
314,473 172,276 4.23 2.24
Security Original Valuation at Cost Valuation
Cost
28 Feb’22
£ £ % %
Unlisted Investments
China Food Company plc 65,969 0 0.89 0.00
Gable Holdings Inc 12,112 0 0.16 0.00
Mar City plc 10,053 0 0.14 0.00
Sorbic International plc 18,717 0 0.25 0.00
106,851 0 1.44 0.00
Total non-qualifying investments 507,733 248,037 6.83 3.23
Top Ten Investments
Security Original Valuation at Cost Valuation
Cost
28 Feb’22
£ £ % %
Audioboom Group plc 122,330 1,073,100 1.65% 13.97%
Property Franchise Group plc 212,312 599,420 2.86% 7.80%
Blackbird plc 96,735 369,600 1.30% 4.81%
Inspired Energy plc 51,370 265,571 0.69% 3.46%
Tristel plc 28,711 245,490 0.39% 3.20%
Belluscura plc 100,506 239,444 1.35% 3.12%
Bigblu Broadband plc 163,569 198,718 2.20% 2.59%
Ideagen plc 28,430 186,352 0.38% 2.43%
Solid State plc 40,134 185,625 0.54% 2.42%
Myhealthchecked plc 200,550 180,306 2.70% 2.35%
14.06% 46.14%
The investments tabulated above are expressed as a percentage of the
Company’s investment portfolio including uninvested cash.
Directors’ Report
The directors present their report and the audited financial statements for
the year to 28 February 2022.
Corporate Governance
The Corporate Governance report on pages 19 to 22 forms part of the
directors’ report.
Results and dividends paid
Year to Year to
28 February 2022
28 February 2021
Special
Distributable Revenue Capital Revenue Capital
Reserve
Reserve
Reserves
Reserve
Reserves
£’000 £’000 £’000 £’000 £’000
Return on ordinary activities after tax - (26) 146 (36) 3,063
Appropriated as follows:
Interim dividend paid in FY’21 for FY’21
Distributable reserves – Nil (1.50p) per share - - - (118) -
Capital reserves – Nil (Nil) per share - - - - -
Final dividend paid in FY’22 for FY’21
Distributable reserves – 6.50p (Nil) per share (511) - - - -
Capital reserves – Nil (Nil) per share - - - - -
Transfers to reserves (511) (26) 146 (154) 3,063
The directors propose a final dividend for the year ended 28 February 2022 of
2.0p per share, (2021: 6.5p final and 1.5p interim, making 8.0p per share in
total).
Directors
The directors, and former directors, of the Company are required to notify
their interests under Disclosure and Transparency Rule 3.12R. The membership
of the Board and their beneficial interests in the ordinary shares of the
Company are set out below:
Year ended Year ended
28 February 2022 28 February 2021
Michael Barnard 2,159,035 2,159,035
John Brice 290,998 NA
Simon Bragg - NA
Geoffrey Gamble 97,125 97,125
Peter William Riley 59,185 59,185
Ian Cameron-Mowat 110,904 110,904
Simon Like 8,800 8,800
All of the directors’ share interests shown above are held beneficially. On
the 7th April 2022, Michael Barnard purchased a further 30,649 shares in New
Century Aim VCT, taking his holding to 2,189,684 shares, equivalent to 27.86%
of the issued share capital. There have been no other changes in the
directors’ share interests between 28 February 2022 and the date of this
report.
Brief biographical notes on the directors are given on page 3.
None of the directors has a contract of service with the Company and, except
as mentioned below under the heading “Management”, there were no contracts
that subsisted during the year in which a director was materially interested
and which was significant in relation to the Company’s business.
Management
M D Barnard & Co Ltd were the managers of the fund from inception until
November 2017 when M D Barnard & Co Ltd was taken over by Oberon
Investments Ltd. However, the investment management team remained unchanged.
The principal terms of the Investment Management Agreement are set out in Note
6 to the Financial Statements.
Substantial shareholdings
As at 28 February 2022 the Company had been notified of the following
shareholdings representing 3 per cent or more of the Company’s issued share
capital during the year under review or at the date of this report:
Number Percentage
of share capital
Michael Barnard 2,159,035 27.47%
Geoffrey Williams 391,570 4.98%
Nigel Shanks 364,820 4.64%
David Trotman 324,000 4.12%
John Brice 290,988 3.70%
Roger Carey 241,048 3.07%
Acquisition of own shares
During the year the Company did not re-purchase any of its own shares.
Structure, rights and restrictions concerning the Company’s share capital
Throughout the Company’s financial year there were 7,860,937 ordinary shares
in issue. No shares were issued or bought back during the year. The rights and
obligations attached to the Company’s ordinary shares are set out in the
Company’s Articles of Association, copies of which can be obtained from
Companies House. The Company has only one class of ordinary share and each
share has attached to it full voting rights, dividends and capital
distribution rights (including on a winding up) and do not confer any rights
of redemption.
Ordinary shareholders also have the right to receive copies of the Company’s
report and accounts, to attend and speak at general meetings and to appoint
proxies.
There is one shareholder with a significant shareholding in the Company, being
Michael Barnard, with 27.47% shareholding as at 28 February 2022. He is also a
director of the Company and taken together he is considered to have a
significant influence over the Company. Other than Michael Barnard, there are
no other shareholders who have a significant direct or indirect shareholding
in the Company.
In accordance with Schedule 7 of the Large and Medium Size Companies and
Groups (Accounts and Reports) Regulations 2008, as amended, the directors
disclose the following information:
* The Company’s capital structure and voting rights are summarised above, and
there are no restrictions on voting rights nor any agreement between holders
of securities that result in restrictions on the transfer of securities or on
voting rights;
* There exist no securities carrying special rights with regard to the control
of the Company;
* The rules concerning the appointment and replacement of directors, amendment
of the Articles of Association and powers to issue or buy back of the
Company’s shares are contained in the Articles of Association of the Company
and the Companies Act 2006;
* The Company does not have an employee share scheme;
* There are no agreements to which the Company is party that may affect its
control following a takeover bid; and
* There are no agreements between the Company and its directors providing for
compensation for loss of office that may occur following a takeover bid or for
any other reason.
Appointment of Directors
The directors are subject to re-election by rotation, with one of the
directors being re-elected annually at the AGM. This year, given that Michael
Barnard is the longest serving director, he is the director who is subject to
this retirement by rotation and re-election. In addition, all directors who
have been appointed since the last AGM are also subject to re-election.
Creditor payment policy
The Company’s payment policy is to agree terms of payment before business is
transacted and to settle accounts in accordance with those terms. The
Company’s principal expenses such as investment management fees and
administration fees are paid quarterly in arrears in accordance with the
respective agreements. Accordingly the Company had no material trade creditors
at the year end.
Streamlined Energy and Carbon Reporting
There are reporting requirements which make it mandatory for companies to
report the amount of energy they use during their financial year. The
Company’s energy usage is below the de minimis level of 40,000kWh.
Post balance sheet events
Details of the post balance sheet event are set out in note 27.
Section 172 (1) of the Companies Act 2006
The Board notes the disclosure regulations contained within ‘The Companies
(Miscellaneous Reporting) Regulations 2018 and confirms that when making
decisions it acts in a way which promotes the success of the Company for the
benefit of its members as a whole, and in doing so has regard (amongst other
matters) to the following:
1. the likely consequences of any decision over the long term;
2. the need to foster the Company’s business relationships with its suppliers;
3. the desirability of the Company maintaining a reputation for high standards of
business conduct; and
4. the need to act fairly as between members of the Company.
The Board also recognises the requirement under Section 414c of the Companies
Act 2006 to detail information about environmental matters (including the
impact of the Company’s business on the environment), employee, human
rights, social and community issues, including information about any policies
it has in relation to these matters and effectiveness of these policies.
Given the size and nature of the Company’s activities and the fact that it
has no full-time employees and only non-executive directors, the Board
considers there is limited scope to develop and implement social and community
policies. However, the Company recognises the need to conduct its business in
a manner responsible to the environment where possible.
The Board believes that the key stakeholders in the business are the
Company’s shareholders (ie the investors in the Company). The Board
communicates with these key stakeholders as explained in the ‘Relations with
shareholders’ section in the Corporate Governance chapter on page 20 in
these Financial Statements.
Going Concern
In accordance with FRC Guidance for directors on going concern and liquidity
risk the directors have assessed the prospects of the Company having adequate
resources to continue in operational existence for at least 12 months from the
date of approval of these financial statements. The directors took into
account the nature of the Company’s business and Investment Policy, its risk
management policies, the diversification of its portfolio, the cash holdings
and the liquidity of its investments. The Company’s business activities,
together with factors likely to affect its future development, performance and
position including the financial risks the Company is exposed to are set out
in the Strategic Report on page 6 and in note 22 to the accounts.
As a consequence, the directors have a reasonable expectation that the Company
has sufficient cash and liquid investments to continue to operate and that the
Company will be able to manage its business risks successfully and meet its
liabilities as they fall due. Thus, the directors believe it is appropriate to
continue to adopt the going concern basis, as also disclosed in the Corporate
Governance report on page 19, in preparing the financial statements.
Auditor
UHY has indicated its intention to resign as auditor for the Company and will
therefore not be recommended for re-appointment at this year’s AGM. The
reason for the resignation of UHY is as a result of a firm wide strategic
review conducted by UHY.
Statement of disclosure to auditor
So far as the directors are aware:
1. there is no relevant audit information of which the Company’s auditor is
unaware; and
2. the directors have taken all steps that they ought to have taken to make
themselves aware of any relevant audit information and to establish that the
auditor is aware of that information.
By Order of the Board
Michael Barnard
Chairman
29 June 2022
Directors’ Remuneration Report
The Board has prepared this report in accordance with the requirements of the
Companies Act 2006. A resolution to approve this report will be included in
the AGM Notice.
Directors’ remuneration policy
The Company does not have any executive directors and, as permitted under the
Listing Rules, has not, therefore, established a remuneration committee.
Directors, with the exception of the former chairman Mr Gamble, do not receive
any remuneration or fees.
The directors shall be paid by the Company all travel, hotel and other
expenses they may incur in attending meetings of the directors or general
meetings or otherwise in connection with the discharge of their duties. Any
director who, by request of the directors, performs special services may be
paid such extra remuneration as the directors may determine.
Directors’ remuneration (audited)
None of the directors received any remuneration from the Company during the
year under review, with the exception of the former chairman Mr Gamble, who
received a fee of £5,000 (2021: £5,000). No other emoluments or pension
contributions were paid by the Company to, or on behalf of, any director. None
of the directors has a service contract with the company. It is expected that
the directors will continue not to receive any remuneration for their services
in the forthcoming years.
Performance
The directors consider that the most appropriate measure of the Company’s
performance is its Cumulative Value of Shareholder Investment (net asset value
plus cumulative dividends). The Company’s Cumulative Value of Shareholder
Investment at 28 February 2022 and 28 February 2021 are set out in the
Financial Summary on page 1.
Total shareholder return
[graph omitted]
The above graph shows the Company’s total shareholder return compared to
that of the FTSE AIM All Index total return for the period since listing on
the London Stock Exchange.
By Order of the Board
Michael Barnard
Chairman
29 June 2022
Corporate Governance
The directors support the relevant principles of the UK Corporate Governance
Code issued in July 2018 by the Financial Reporting Council, being the
principles of good governance and the code of best practice as set out in the
Main Principles of the Code annexed to the Listing Rules of the Financial
Conduct Authority.
The UK Corporate Governance Code (‘the UK Code’) is available at the
following location: www.frc.org.uk/corporate/ukcgcode.cfm
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.frc.org.uk%2Fcorporate%2Fukcgcode.cfm&esheet=52766195&newsitemid=20220629005816&lan=en-US&anchor=www.frc.org.uk%2Fcorporate%2Fukcgcode.cfm&index=1&md5=3037b7d71431d3445e82a959ef3a5856)
Going concern
Bearing in mind that the assets of the Company consist mainly of marketable
securities, the directors are of the opinion that at the time of approving the
Financial Statements, the Company has adequate resources to continue in
operational existence for the foreseeable future. In addition the Company has
no employees and therefore its operations are not impacted by the recent
Covid-19 pandemic. For this reason, they continue to adopt the going concern
basis in preparing the Financial Statements. In coming to this conclusion the
directors have concluded that the Company’s going concern status would only
be at threat if (i) the value of its portfolio declined by more than 98% from
its bid-price value (whether from Covid-19 or any other reason) as at 28
February 2022 of £7,323.7k (excluding cash of £356k), and (ii) that it could
not dispose of any of its portfolio during or after such a decline in value,
and (iii) that it could not reduce its current cost base. Such a set of
circumstances would, in the Board’s opinion, be very unlikely.
The Board
The Company is led and controlled by a Board of directors who are all
non-executive and who either had relevant experience with quoted companies
prior to their appointment or had a good knowledge base of the rules and
regulations concerning a director’s responsibilities with listed companies.
It was therefore not thought necessary to provide further training, above that
which they already undertake, in respect of their obligations and duties. The
Chairman is Michael Barnard. Biographical details of all Board members are
shown on page 3.
One Director is subject to re-election at each AGM by rotation, plus any
director who has been appointed since the last AGM.
During the year the following were held:
4 full board meetings 2 Audit Committee meetings
24 June 2021 – Attended by G Gamble, S Like, and P Riley. 23 June 2021 - All members who held office at that time attended.
28 October 2021 – All directors who held office at that time attended. 27 October 2021 – All members who held at that time office attended.
16 October 2021 – All directors who held office at that time attended.
28 January 2022 – All directors who held office at that time attended.
The Board has also established procedures whereby directors wishing to do so
in the furtherance of their duties may take independent professional advice at
the Company’s expense.
All directors have access to the advice and services of the Company Secretary.
The Company Secretary provides the Board with full information on the
Company’s assets and liabilities and other relevant information requested by
the Chairman, in advance of each Board meeting.
The Board believes that the financial statements present a balanced and
understandable assessment of the Company’s position and prospects. The Audit
Committee meets at least twice a year. Under the chairmanship of a
non-executive director, its membership comprises Simon Bragg and John Brice.
During the year up to the date of his resignation on 28 January 2022, the
Audit Committee was chaired by the former Chairman, Geoffrey Gamble. The other
members of the Audit Committee prior to the 28 January 2022 were Peter Riley
and Ian Cameron-Mowat. Since then the Audit Committee has been chaired by
Simon Bragg. The Audit Committee reviews the financial statements and is
reported to by the external auditors. The Audit Committee did not identify or
consider any significant issues relating to the financial statements as
substantially all the investments are valued by reference to publicly quoted
prices. Further, the Audit Committee keeps under review the cost
effectiveness, independence and objectivity of the auditors. A formal
statement of independence is received from the external auditors each year.
The terms of reference of the Audit Committee are available for inspection at
the Company’s registered office.
The Audit Committee is satisfied with the performance of UHY Hacker Young.
However, following UHY Hacker Young’s decision to resign, the Company will
not be recommending their reappointment at the AGM and will be seeking the
services of another firm for this year’s audit.
The investment manager is authorised and regulated by the Financial Conduct
Authority and the directors of this Company review the Independent Auditors’
Report of Oberon Investments Limited to ensure that there are no adverse
findings with regard to its financial controls.
Relations with shareholders
The Chairman is the Company’s principal spokesman with investors, fund
managers, the press and other interested parties.
Separate resolutions are proposed at the AGM on each substantially separate
issue. The Registrars collate proxy votes and the results (together with the
proxy forms) are forwarded to the Company Secretary immediately prior to the
AGM. In order to comply with the Governance Code, proxy votes will be
announced at the AGM, following each vote on a show of hands, except in the
event of a poll being called.
Financial Reporting
The statement of directors’ responsibilities for preparing the financial
statements is set out on page 22, and a statement by the auditors about their
reporting responsibilities is set out in the Auditor’s Report on page 28.
Internal control
The directors are responsible for the Company’s system of internal control.
Although no system of internal control can provide absolute assurance against
material misstatement or loss, the Company’s systems are designed to provide
the directors with reasonable assurance that problems are identified on a
timely basis and dealt with appropriately.
The directors have conducted a review of the effectiveness of the system of
internal control for the year covered by the financial statements. This
accords with the FRC’s guidance on Risk Management, internal control and
related Financial and Business reporting.
Although the Board is ultimately responsible for safeguarding the assets of
the company, the Board has delegated, through written agreements, the
day-to-day operation of the Company to Oberon Investments Limited.
Compliance statement
The Listing Rules require the Board to report on compliance with the
Governance Code provisions throughout the accounting year. The Comply or
Explain Section of the UK Code does however acknowledge that some provisions
may have less relevance for investment companies. With the exception of the
limited items outlined below, the Company has complied throughout the
accounting year to 28 February 2022 with the provisions set out in Sections A
to E of the Governance Code.
1. The Board has not appointed a nominations committee as they consider the
Board to be small and it comprises wholly non-executive directors.
Appointments of new directors are dealt with by the full Board.
2. New directors do not receive a full, formal and tailored induction on
joining the Board. Such matters are addressed on an individual basis as they
arise.
3. Due to the size of the Board and the nature of the Company’s business, a
formal performance evaluation of the Board, its committees, the individual
directors and the Chairman has not been undertaken. Specific performance
issues are dealt with as they arise.
4. The Company has three directors of which John Brice and Simon Bragg are
independent directors, as defined by the Governance Code issued in July 2018.
The Board consider that John Brice and Simon Bragg are independent in
character and judgement and there are no relationships or circumstances which
are likely to affect, or could appear to affect the directors’ judgement.
The Board considers that all directors have sufficient experience to be able
to exercise proper judgement within the meaning of the Governance Code.
5. The Company does not have a chief executive officer or senior independent
director. The Board does not consider this to be necessary for the size of the
company.
6. The Company does not conduct a formal review as to whether there is a need
for an internal audit function. The directors do not consider that an internal
audit would be an appropriate control for a venture capital trust.
7. The Audit Committee is now chaired by Simon Bragg.
8. The non-executive directors do not have service contracts, whereas the
recommendation is for fixed term renewable contracts.
9. Other than Michael Barnard, the Company has no major shareholders so
shareholders are not given the opportunity to meet any new non-executive
directors at a specific meeting other than the AGM.
Statement of directors’ responsibilities
United Kingdom company law requires the directors to prepare financial
statements for each financial year which give a true and fair view of the
state of affairs of the Company as at the end of the financial year and of the
revenue of the Company for that year. In preparing those financial statements,
the directors are required to:
* select suitable accounting policies and apply them consistently;
* make judgements and estimates that are reasonable and prudent;
* state whether applicable accounting standards have been followed; and
* prepare the financial statements on the going concern basis unless it is
inappropriate to presume that the Company will continue in business.
The directors are responsible for ensuring that proper accounting records are
kept, which disclose with reasonable accuracy at any time the financial
position of the company, enabling them to ensure that the financial statements
comply with the Companies Act 2006. They are also responsible for the
Company’s system of internal control, for safeguarding the assets of the
Company and for taking reasonable steps for the prevention and detection of
fraud and other irregularities.
Responsibility statement
The directors confirm that to the best of their knowledge:
1. the financial statements, prepared in accordance with United Kingdom
Accounting Standards (United Kingdom Generally Accepted Accounting Practice),
give a true and fair view of the assets, liabilities, financial position and
profit or loss of the company
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Ffsahandbook.info%2FFSA%2Fglossary-html%2Fhandbook%2FGlossary%2FI%3Fdefinition%3DG627&esheet=52766195&newsitemid=20220629005816&lan=en-US&anchor=company&index=2&md5=b26fbcff79eead9fa254f14d303055fa)
; and
2. the Directors’ Report includes a fair review of the development and
performance and position of the company, together with a description of the
principal risks and uncertainties that it faces.
3. the directors consider that the annual report and financial statements are
fair, balanced and understandable, providing appropriate information to
shareholders to assess the performance, business model and strategy of the
Company and therefore the Board recommends the approval of the financial
statements at the forthcoming AGM.
By Order of the Board
Michael Barnard
29 June 2022
Independent Auditor’s Report to the members of New Century AIM VCT plc
Opinion
We have audited the Financial Statements of New Century AIM VCT plc for the
year ended 28 February 2022, which comprise the Statement of Comprehensive
Income, the Balance Sheet, the Statement of Changes in Equity, the Cash Flow
Statement and notes to the Financial Statements, including significant
accounting policies. The financial reporting framework that has been applied
in their preparation is applicable law and United Kingdom Accounting
Standards, including Financial Reporting Standard 102 “The Financial
Reporting standard applicable in the UK and Republic of Ireland” (United
Kingdom Generally Accepted Accounting Practice).
In our opinion the financial statements:
* give a true and fair view of the state of the Company's affairs as at 28
February 2022 and of the Company's return for the year then ended;
* have been properly prepared in accordance with United Kingdom Generally
Accepted Accounting Practice; and
* have been prepared in accordance with the requirements of the Companies Act
2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing
(UK) (ISAs (UK)) and applicable law. Our responsibilities under those
standards are further described in the Auditor’s responsibilities for the
audit of the Financial Statements section of our report. We are independent of
the Company in accordance with the ethical requirements that are relevant to
our audit of the Financial Statements in the UK, including the FRC’s Ethical
Standard as applied to listed public interest entities, and we have fulfilled
our other ethical responsibilities in accordance with these requirements. We
believe that the audit evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.
Our approach to the audit
As part of designing our audit, we determined materiality and assessed the
risks of material misstatement in the Financial Statements. In particular, we
looked at where the Directors made subjective judgements, for example in
respect of significant accounting estimates that involved making assumptions
and considering future events that are inherently uncertain.
We tailored the scope of our audit to ensure that we performed enough work to
be able to give an opinion on the Financial Statements as a whole, taking into
account an understanding of the structure of the Company, their activities,
the accounting processes and controls, and the industry in which it operates.
Our planned audit testing was directed accordingly and was focused on areas
where we assessed there to be the highest risk of material misstatement.
The audit team met and communicated regularly throughout the audit with the
Audit Committee and the Investment Manager in order to ensure we had a good
knowledge of the business of the Company. During the audit, we reassessed and
re-evaluated audit risks and tailored our approach accordingly.
The audit testing included substantive testing on significant transactions,
balances and disclosures, the extent of which was based on various factors
such as our overall assessment of the control environment, the design
effectiveness of controls and the management of specific risk.
We communicate with those charged with governance regarding, among other
matters, the planned scope and timing of the audit and significant findings,
including any significant deficiencies in internal control that we identified
during the audit.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were
of most significance in our audit of the Financial Statements of the current
period and include the most significant assessed risks of material
misstatement (whether or not due to fraud) we identified, including those
which had the greatest effect on: the overall audit strategy, the allocation
of resources in the audit; and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the Financial
Statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters. This is not a complete list of
all risks identified during our audit. Going concern is a significant key
audit matter and is described below. In arriving at our audit opinion above,
the other key audit matters were as follows:
Key risks How our audit addressed the key audit matters
Valuation of Investments and recognition of realised gains and losses Our audit work included, but was not restricted to:
The investment portfolio and associated realised and unrealised gains and
*Testing the value of the year-end investments by reference to market price
losses are the key driver to the financial performance of the Company. Due to information.
the nature of the Company’s business there is an inherent risk that if
incorrectly valued this will have the greatest impact on both the income
statement and balance sheet.
*Agreeing the purchase and sale of investments to contract notes and cash
movements on a sample basis.
The investment portfolio at the year-end had a carrying value of £7,323,716,
made up of quoted investments.
*Recalculating the realised gains and losses on the sale of investments for
both the individual transactions on a sample basis and for the total
portfolio.
*Checking the movement in unrealised gains for arithmetical accuracy and
validating by reviewing the opening costs to prior year balances and purchases
on a sample basis.
*The portfolio is maintained by the investment manager in accordance with the
investment management agreement. We agreed the investment portfolio to a
signed confirmation provided by the investment advisor detailing each
investment, the cost and market price.
The company's accounting policy on fixed asset investments held at fair value
through profit or loss is shown in note 4 to the Financial Statements and
related disclosures are included in note 12.
Key observations
Our testing did not identify any material misstatements in the valuation of
the Company’s investment portfolio as at the year end.
Compliance with the VCT rules Our audit work included, but was not restricted to:
Compliance with the VCT rules is necessary to maintain the VCT status and
*Review of the design and implementation of controls around the ongoing
associated tax benefits. internal assessment and monitoring of VCT compliance. We obtained an
understanding of the processes adopted and evidenced the work completed by the
Investment Manager on documenting compliance with the key VCT rules and
management’s review of this on a regular basis.
*Testing the twelve conditions for maintaining approval as a VCT as set out by
HMRC. Each of the conditions was reviewed in turn in order to assess whether
it had been met as at the year-end.
Key observations
We reviewed the documentation maintained, that confirmed the Company was in
compliance with the VCT rules during the period and at the year end,
furthermore our own testing of compliance with the individual VCT rules did
not identify any breaches.
Our application of materiality
The scope and focus of our audit was influenced by our assessment and
application of materiality. We apply the concept of materiality both in
planning and performing our audit, and in evaluating the effect of
misstatements on our audit and on the Financial Statements.
We define Financial Statement materiality as the magnitude by which
misstatements, including omissions, could reasonably be expected to influence
the economic decisions taken on the basis of the Financial Statements by
reasonable users.
In order to reduce to an appropriately low level the probability that any
misstatements exceed materiality, we use a lower materiality level,
performance materiality, to determine the extent of testing needed.
Importantly, misstatements below these levels will not necessarily be
evaluated as immaterial as we also take account of the nature of identified
misstatements, and the particular circumstances of their occurrence, when
evaluating their effect on the Financial Statements as a whole.
Materiality Measure Company
Overall materiality We determined materiality for the Financial Statements as a whole to be
£154,000.
The prior year materiality was £122,000.
How we determine it Based on a benchmark of 2% of gross assets.
The prior year’s materiality was based on 1.5% of gross assets. We have
increased this in the current year to 2% because we believe the audit to be
low risk due to minimal adjustments being made in previous years. UHY
methodology allows for a range of 0.5% - 2% of gross assets to be used for
public interest entities.
Rationale for benchmarks applied We believe 2% of gross assets to be the most appropriate benchmark as it
primarily comprises the Company’s investment portfolio, which is considered
to be the key driver of the Company’s total return performance and forms
part of the net asset value calculation being the performance measure
investors use to assess the Company’s performance.
Performance materiality On the basis of our risk assessment, together with our assessment of the
Company’s control environment, our judgement is that performance materiality
for the Financial Statements should be 75% of materiality and was set at
£115,500.
Specific materiality We also determine a lower level of specific materiality for certain areas such
as directors’ remuneration. Area materiality for the disclosure of the cash
element of directors’ remuneration has been set at £2,000 and performance
materiality of £1,000.
Reporting threshold We agreed with the Audit Committee that we would report to them all
misstatements over £7,700 (5% of overall materiality) identified during the
audit, as well as differences below that threshold that, in our view, warrant
reporting on qualitative grounds. We also report to the Audit Committee on
disclosure matters that we identified when assessing the overall presentation
of the Financial Statements.
Conclusions relating to going concern
In auditing the Financial Statements, we have concluded that the Directors’
use of the going concern basis of accounting in the preparation of the
financial statement is appropriate. Our evaluation of the Director’s
assessment of the entity’s ability to continue to adopt the going concern
basis of accounting included:
Evaluation of management assessment Key observations
The Company’s cash flow forecasts to February 2025 (‘the going concern At 28 February 2022, the Company held cash of £356k held by the investment
period’) have been approved by the Board. These are prepared based on manager.
certain key assumptions, against which plausible sensitivities have been
applied.
Based on the audit procedures performed we concluded that the Company has
appropriately adopted the going concern basis of preparation.
The forecast shows that the Company has at all times available cash and
liquidity to meets its liabilities as they fall due.
Further we did not identify any material disclosures that should be included
regarding any material uncertainty in respect of the going concern basis of
We evaluated the Director’s going concern assessment and performed the preparation.
following procedures:
*We assessed the appropriateness of the cash flow forecasts in the context of
the Company’s 2022 financial performance and evaluated the Director’s
sensitivities performed against this forecast.
*We evaluated the key assumptions in the forecast, which were consistent with
our knowledge of the business and considered whether these were supported by
the evidence we obtained.
*We compared the prior year forecast against current year actual performance to
assess management’s ability to forecast accurately.
*We reviewed the post year end portfolio and bank statement.
*We examined and confirmed the Directors’ assessment of the liquidity of the
AIM and AQSE listed shares.
*We also reviewed the disclosures relating to going concern basis of
preparation and found that these provided an explanation of the Directors’
assessment that was consistent with the evidence we obtained.
Based on the work we have performed, we have not identified any material
uncertainties relating to events or conditions that, individually or
collectively, may cast significant doubt on the Company’s ability to
continue as a going concern for a period of at least twelve months from when
the Financial Statements are authorised for issue.
In relation to the Company reporting on how they have applied the relevant
principles of the UK Corporate Governance Code issued in July 2018 by the
Financial Reporting Council, being the principles of good governance and the
code of best practice as set out in the Main Principles of the Code annexed to
the Listing Rules of the Financial Conduct Authority, we have nothing material
to add or draw attention to in relation to the Directors’ statement in the
Financial Statements about whether the Directors considered it appropriate to
adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect to
going concern are described in the relevant sections of this report.
Other information
The other information comprises the information included in the Annual Report
other than the Financial Statements and our auditors’ report thereon. The
Directors are responsible for the other information contained within the
Annual Report. Our opinion on the Financial Statements does not cover the
other information and, except to the extent otherwise explicitly stated in our
report, we do not express any form of assurance conclusion thereon.
Our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the Financial
Statements or our knowledge obtained in the course of the audit, or otherwise
appears to be materially misstated. If we identify such material
inconsistencies or apparent material misstatements, we are required to
determine whether this gives rise to a material misstatement in the Financial
Statements themselves.
If, based on the work we have performed, we conclude that there is a material
misstatement of this other information; we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, the part of the Directors’ Remuneration Report to be audited
has been properly prepared in accordance with the Companies Act 2006.
In our opinion, based on the work undertaken in the course of the audit:
* the information given in the Strategic Report and the Directors’ Report for
the financial year for which the Company Financial Statements are prepared is
consistent with the Financial Statements; and
* the Strategic Report and the Directors’ Report have been prepared in
accordance with applicable legal requirements.
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Company and its
environment obtained in the course of the audit, we have not identified
material misstatements in the Strategic Report or the Directors’ Report.
We have nothing to report in respect of the following matters in relation to
which the Companies Act 2006 requires us to report to you if, in our opinion:
* adequate accounting records have not been kept by the Company, or returns
adequate for our audit have not been received from branches not visited by us;
or
* the Financial Statements and the part of the Directors’ Remuneration Report
to be audited are not in agreement with the accounting records and returns; or
* certain disclosures of Directors’ remuneration specified by law are not
made; or
* we have not received all the information and explanations we require for our
audit.
Corporate Governance Statement
The Listing Rules require us to review the Directors’ statement in relation
to going concern, longer-term viability and that part of the Corporate
Governance Statement relating to the Company’s compliance with the
provisions of the UK Corporate Governance Statement specified for our review.
Based on the work undertaken as part of our audit, we have concluded that each
of the following elements of the Corporate Governance Statement is materially
consistent with the Financial Statements or our knowledge obtained during the
audit:
* Directors’ statement with regards the appropriateness of adopting the going
concern basis of accounting and any material uncertainties identified, set out
on page 19;
* Directors’ explanation as to its assessment of the Company’s prospects,
the period this assessment covers and why the period is appropriate, set out
on page 7;
* Directors’ statement on fair, balanced and understandable, set out on page
22;
* Board’s confirmation that it has carried out a robust assessment of the
emerging and principal risks, set out on page 7;
* The section of the Annual Report that describes the review of effectiveness of
risk management and internal control systems, set out on page 20; and
* The section describing the work of the Audit Committee, set out on pages 19
and 20.
Responsibilities of Directors
As explained more fully in the Statement of Directors’ Responsibilities set
out on page 22, the Directors are responsible for the preparation of the
Financial Statements and for being satisfied that they give a true and fair
view, and for such internal control as the Directors determine is necessary to
enable the preparation of Financial Statements that are free from material
misstatement, whether due to fraud or error.
In preparing the Financial Statements, the Directors are responsible for
assessing the Company’s ability to continue as a going concern, disclosing,
as applicable, matters related to going concern and using the going concern
basis of accounting unless the Directors either intend to liquidate the
Company or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the Financial
Statements as a whole are free from material misstatement, whether due to
fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that
an audit conducted in accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud or error and
are considered material if, individually or in the aggregate, they could
reasonably be expected to influence the economic decisions of users taken on
the basis of these Financial Statements.
The extent to which our procedures are capable of detecting irregularities,
including fraud is detailed below:
Based on our understanding of the Company and the industry in which it
operates, we identified that the principal risks of non-compliance with laws
and regulations related to HMRC VCT rules, employment and health and safety
regulation, anti-bribery, corruption and fraud, and we considered the extent
to which non-compliance might have a material effect on the Financial
Statements. We also considered those laws and regulations that have a direct
impact on the preparation of the Financial Statements such as FRS102,
Companies Act 2006 and the UK Corporate Governance Code. We evaluated
management’s incentives and opportunities for fraudulent manipulation of the
Financial Statements (including the risk of override of controls), and
determined that the principal risks were related to inflated investment
valuations and profit.
We understood how the Company is complying with those legal and regulatory
frameworks by making inquiries to the investment manager and the Audit
Committee. We corroborated our inquiries through our review of Board minutes
and papers provided to the Audit Committee.
We assessed the susceptibility of the Company financial statements to material
misstatement, including how fraud might occur. Audit procedures performed by
the engagement team included:
* identifying and assessing the design effectiveness of controls management has
in place to prevent and detect fraud;
* understanding how those charged with governance considered and addressed the
potential for override of controls or other inappropriate influence over the
financial reporting process;
* assessing the extent of compliance with the relevant laws and regulations as
part of our procedures on the related financial statement item.
We reviewed the Financial Statement disclosures to underlying supporting
documentation, made enquiries of management in so far as they related to the
Financial Statements, and tested of the valuation of investments and
evaluating whether there was evidence of bias by the Directors that
represented a risk of material misstatement due to fraud.
There are inherent limitations in the audit procedures described above and the
further removed non-compliance with laws and regulations is from the events
and transactions reflected in the Financial Statements, the less likely we
would become aware of it. Also, the risk of not detecting a material
misstatement due to fraud is higher than the risk of not detecting one
resulting from error, as fraud may involve deliberate concealment by, for
example, forgery or intentional misrepresentations, or through collusion.
A further description of our responsibilities for the audit of the Financial
Statements is located on the Financial Reporting Council’s website at
www.frc.org.uk/auditorsresponsibilities
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.frc.org.uk%2Fauditorsresponsibilities&esheet=52766195&newsitemid=20220629005816&lan=en-US&anchor=www.frc.org.uk%2Fauditorsresponsibilities&index=3&md5=9b8b6f0cc87dffc14614e704a1afba4e)
. This description forms part of our auditor’s report.
Other matters which we are required to address
Following the recommendation of the Audit Committee, we were appointed by New
Century AIM VCT plc to audit the Financial Statements for the year ending 28
February 2009 and subsequent financial periods. The period of total
uninterrupted engagement is 14 years, covering the years ending 28 February
2009 to 28 February 2022.
The non-audit services prohibited by the FRC’s Ethical Standard were not
provided to the Company and we remain independent Company in conducting our
audit.
Our audit opinion is consistent with the additional report to the Audit
Committee.
Use of our report
This report is made solely to the Company’s members, as a body, in
accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work
has been undertaken so that we might state to the Company’s members those
matters we are required to state to them in an auditors’ report and for no
other purpose. To the fullest extent permitted by law, we do not accept or
assume responsibility to anyone other than the Company and the Company’s
members as a body, for our audit work, for this report, or for the opinions we
have formed.
Daniel Hutson (Senior Statutory Auditor)
For and on behalf of
UHY Hacker Young
Chartered Accountants
Statutory Auditors
Quadrant House
4 Thomas More Square
London, E1W 1YW
29 June 2022
Statement of Comprehensive Income (incorporating the revenue accounts)
for the year to 28 February 2022
Year ended Year ended
28 February 2022
28 February 2021
Notes Revenue Capital Total Revenue Capital Total
£’000
£’000
£’000
£’000
£’000
£’000
Gains on investments
- realised - 448 448 - 295 295
- unrealised - (236) (236) - 2,817 2,817
Income 5 69 - 69 36 - 36
Investment management fee 6 (22) (66) (88) (16) (49) (65)
Other expenses 7 (73) - (73) (56) - (56)
________ ________ ________ ________ ________ ________
Return on ordinary activities before taxation (26) 146 120 (36) 3,063 3,027
- - - - - -
Tax credit/ (charge) on ordinary activities 9
________ ________ ________ ________ ________ ________
Return on ordinary activities after taxation (26) 146 120 (36) 3,063 3,027
Return per ordinary share (pence) (0.33) 1.86 1.53 (0.47) 38.96 38.49
11
The notes on pages 35 to 46 form an integral part of these financial
statements.
All revenue and capital items in the above statement are from continuing
operations in the current year. No operations were acquired or discontinued in
the current year. Other than as shown above, the Company had no recognised
gains or losses. Accordingly, the above represents the total comprehensive
income for the year.
Balance Sheet
at 28 February 2022
Year ended Year ended
28 February 2022
28 February 2021
(as restated)
£’000
Note £’000
Fixed assets
Investments 12 7,324 8,004
Current assets
Debtors 15 411 123
Current liabilities
Creditors: amounts falling due within one year 16 (32) (33)
7,703 8,094
Capital and reserves
Called up share capital 17 786 786
Share premium 20 682 682
Special distributable reserve 20 3,638 4,149
Capital reserve – realised 20 1,810 1,143
Capital reserve – unrealised 20 248 769
Capital Redemption Reserve 20 400 400
Revenue reserve 20 139 165
Total equity shareholders’ funds 7,703 8,094
Net asset value per ordinary share 18 98p 103p
The financial statements on pages 31 to 46 were approved and authorised for
issue by the Board of directors on 29 June 2022 and were signed on its behalf
by:
Michael Barnard
Chairman
The notes on pages 35 to 46 form an integral part of these financial
statements.
Company’s registered number: 05352611
Statement of Changes in Equity
at 28 February 2022
Share Share Capital Special Capital Capital Revenue Total
capital
premium
redemption
distributable
realised
unrealised
reserve
account
reserve
reserve
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
As restated at 1 March 2021 786 682 400 4,149 1,143 769 165 8,094
Realised gains - - - - 448 - - 448
Transfer of unrealised gain to realised on disposal - - - - 285 (285) - -
Net revenue pre-tax - - - - - - (26) (26)
Capital element of investment management fee - - - - (66) - - (66)
Dividends paid - - - (511) - - - (511)
Unrealised decreases in value period - - - - - (236) - (236)
At 28 February 2022 786 682 400 3,638 1,810 248 139 7,703
Share Share Capital Special Capital Capital Revenue Total
capital
premium
redemption
distributable
realised
unrealised
reserve
account
reserve
reserve
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
As at 1 March 2020 786 682 400 - 922 2,077 319 5,186
Realised gains - - - - 295 - - 295
Transfer of unrealised loss to realised on disposal - - - - (24) 24 - -
Net revenue pre-tax - - - - - - (36) (36)
Capital element of investment management fee - - - - (49) - - (49)
Dividends paid - - - - - - (118) (118)
Unrealised increases in value in period - - - - - 2,817 - 2,817
At 28 February 2021 786 682 400 - 1,143 4,918 165 8,094
Prior year adjustment inter reserve transfer - - - 4,149 - (4,149) - -
As restated at 28 February 2021 786 682 400 4,149 1,143 769 165 8,094
Note: Some columns on this page may not cast because of rounding differences.
Cash Flow Statement
for the year to 28 February 2022
Year ended Year ended
28 February 2022
Note
28 February 2021
£’000
£’000
Cash flow from operating activities
Cash used in operations 21 (217) (112)
Net cash used in operating activities (217) (112)
Cash flows from investing activities
Investment income 69 36
Net cash from investing activities 69 36
Cash flows from financing activities
Sale of investments 1,278 836
Purchase of investments (386) (683)
Dividends paid (511) (118)
Net cash generated from financing activities 381 35
Net increase/(decrease) in cash and cash equivalents 233 (41)
Cash and cash equivalents at the beginning of the year 123 164
Cash and cash equivalents at the end of year 21 356 123
The notes on pages 35 to 46 form an integral part of these financial
statements.
All cash is held on behalf of the VCT by Oberon Investments Limited as our
Investment Manager, see note 21.
Notes to the Financial Statements
for the year to 28 February 2022
1. Company information
New Century AIM VCT PLC is a UK incorporated company whose registered office
is:
4th Floor
50 Mark Lane
London EC3R 7QR
New Century AIM VCT PLC is a Venture Capital Trust established under the
legislation introduced in the Finance Act 1995. The Company’s principal
objective is to achieve long term capital growth through investment in a
diversified portfolio of qualifying companies primarily quoted on AIM.
2. Basis of preparation
The Financial Statements have been prepared under the historical cost
convention, except for the measurement at fair value of certain financial
instruments, and in accordance with UK Generally Accepted Accounting Practice
(“GAAP”), including FRS 102 and with the Companies Act 2006 and the
Statement of Recommended Practice (SORP) ‘Financial Statements of Investment
Trust Companies and Venture Capital Trusts (revised 2019)’.
The principal accounting policies have remained materially unchanged from
those set out in the Company’s 2021 Annual Report and Financial Statements.
A summary of the principal accounting policies is set out below.
The Company is a public company and is limited by shares. The Company held all
fixed asset investments at fair value through profit or loss. Accordingly, all
interest income, fee income, expenses and gains and losses on investments are
attributable to assets held at fair value through profit or loss.
Going Concern basis – on the basis that the assets of the Company consist
mainly of marketable securities, the directors are of the opinion that at the
time of approving the accounts, the Company has adequate resources to continue
in operational existence for the foreseeable future. This is because the
directors have a reasonable expectation that the Company has sufficient cash
and liquid investments to continue to operate and that the Company will be
able to manage its business risks successfully and meet its liabilities as
they fall due. Thus, the directors believe it is appropriate to continue to
adopt the going concern basis, as also disclosed in the Corporate Governance
report on page 19, in preparing the financial statements.
The financial statements are presented in Sterling.
3. Significant estimates and judgements
As the Company’s investment holdings, which comprise about 95% of its total
assets, are stated at market bid value based on the closing prices of the
London Stock Exchange, the directors do not believe that there is any inherent
uncertainty in their presentation of these amounts, and that in their
judgement, market value and fair value may be regarded as identical for the
purpose of these Financial Statements.
4. Accounting policies
Investments
The Company’s principal financial assets are its investments and the
policies in relation to those assets are set out below.
Purchases and sales of investments are recognised in the Financial Statements
at the date of the transaction (trade date).
These investments will be managed and their performance evaluated on a fair
value basis and information about them is provided internally on that basis to
the Board. Accordingly, as permitted by FRS 102, the investments are measured
as being fair value through profit or loss on the basis that they qualify as a
group of assets managed, and whose performance is evaluated, on a fair value
basis in accordance with a documented investment strategy. The Company's
investments are measured at subsequent reporting dates at fair value.
In the case of investments quoted on a recognised stock exchange, fair value
is established by reference to the closing bid price on the relevant date or
the last traded price, depending upon convention of the exchange on which the
investment is quoted. In the case of AIM quoted investments this is the
closing bid price. In the case of unquoted investments, fair value is
established by using measures of value such as the price of recent
transactions, earnings or revenue multiples, discounted cash flows and net
assets. These are consistent with the IPEV guidelines.
Realised surpluses or deficits on the disposal of investments and permanent
impairments in the value of investments are taken to realised capital
reserves. Unrealised surpluses and deficits on the revaluation of investments
are taken to unrealised capital reserves. Costs incurred relating to
acquisitions and disposals are charged to capital reserves as a deduction from
proceeds or an addition to costs.
In the preparation of the valuations of assets the directors are required to
make judgements and estimates that are reasonable and incorporate their
knowledge of the performance of the investee companies. In the event that the
shares held by the Company are subject to certain restrictions, or the holding
is significant in relation to the traded issued share capital of the investee
company then the directors may apply a discount to the relevant market price.
Fair value hierarchy
Paragraph 34.22 of FRS 102 regarding financial instruments that are measured
in the balance sheet at fair value requires disclosure of fair value
measurements dependent on whether the stock is quoted and the level of the
accuracy in the ability to determine its fair value. The fair value
measurement hierarchy is as follows:
For quoted investments:
Level 1: quoted prices in active markets for an identical asset. The fair
value of financial instruments traded in active markets is based on quoted
market prices at the balance sheet date. A market is regarded as active if
quoted prices are readily and regularly available, and those prices represent
actual and regularly occurring market transactions on an arm’s length basis.
The quoted market price used for financial assets held is the bid price at the
Balance Sheet date.
Level 2: where quoted prices are not available (or where a stock is normally
quoted on a recognised stock exchange that no quoted price is available), the
price of a recent transaction for an identical asset, providing there has been
no significant change in economic circumstances or a significant lapse in time
since the transaction took place. The Company held no such investments in the
current or prior year.
For investments not quoted in an active market:
Level 3: the fair value of financial instruments that are not traded in an
active market is determined by using valuation techniques. Although the
Company held some unquoted investments during the year, their values have been
written down and they have no value in the portfolio as at 28 February 2022.
There have been no transfers between these classifications in the year (2021:
none). The change in fair value for the current and previous year is
recognised through the profit and loss account.
Current asset investments
No current asset investments were held at 28 February 2022 or 28 February
2021. Should current assets be held, gains and losses arising from changes in
fair value of investments are recognised as part of the capital return within
the Income Statement and allocated to the capital reserve - gains/(losses) on
disposal.
It is not the Company’s policy to exercise controlling or significant
influence over investee companies, although it may hold a significant interest
in some companies. Accordingly, the results of these companies are not
incorporated into the revenue account except to the extent of any income
earned or received.
Income
Dividend income receivable from quoted securities is recognised on the
ex-dividend date. Income from unquoted equity and non-equity securities is
recognised on an accruals basis except that a full provision is made until the
receipt of the income is certain.
Interest from cash and deposits and fixed returns on debt securities are
recognised on an accruals basis.
Expenses
All expenses are accounted for on an accruals basis. One quarter of the
investment management fee is charged to the revenue account and the remaining
three quarters is charged to capital reserves, net of corporation tax relief,
and inclusive of any irrecoverable value added tax. The allocation of the
management fee reflects the directors’ estimate of the source of the
long-term returns in the portfolio from revenue and capital.
Taxation
The tax currently payable is based on taxable profit for the year. Taxable
profit differs from net profit as reported in the statement of comprehensive
income because it excludes items of income or expense that are taxable or
deductible in other years and it further excludes items that are never taxable
or deductible. The Company’s liability for current tax is calculated using
tax rates that have been enacted or substantively enacted by the reporting end
date.
5. Income
Year ended Year ended
28 February 28
Fe
br
ua
ry
2022 20
21
£’000 £’
00
0
Interest receivable
- bank deposits and liquid funds - -
Dividends from UK companies 69 36
Investment income 69 36
All of the Company’s income has been generated in the United Kingdom from
dividend income from its investment portfolio.
6. Investment management fees
Year ended Year ended
28 February 28 February
2022 2021
Revenue Capital Revenue Capital
£’000
£’000
£’000 £’000
Investment management fees 22 66 16 49
Oberon Investments Limited provides investment management services to the
Company in respect of the Company’s portfolio of venture capital investments
under an investment management agreement dated 10 March 2005, supported by a
deed of amendment dated 4 September 2017.
Under the terms of the investment management agreement, Oberon Investments
Limited is entitled to a fee (exclusive of VAT) equal to 1% per annum of the
net assets of the company. The fee is calculated quarterly in arrears based on
the net assets at 28 February, 31 May, 31 August and 30 November. No
performance fee is payable. Included in creditors at the year-end is £19,557
(2021: £20,629) for the Q4 investment management fee.
The investment management agreement is for a minimum period of three years
from 1 September 2017, subject to a trade-off clause that if Simon Like, the
present investment manager, ceases to manage the Company’s investments, the
Company may terminate the agreement with Oberon Investments Limited in a
mirror time frame of 12 months’ notice period.
7. Other expenses
Year ended Year ended
28 February 28 February
2022 2021
£’000
£’000
Administrative and secretarial services
41 28
Auditors’ remuneration
- for audit services 15 12
Regulatory fees 17 16
73 56
8. Directors’ remuneration
The former chairman, Mr Gamble, received £5,000 (2021: £5,000) remuneration
in the year. No other remuneration has been paid or is payable for the year to
28 February 2022 or in respect of the prior year.
9. Tax charge/(credit) on ordinary activities
Year ended Year ended
28 February 28 February
2022 2021
Revenue Capital Revenue Capital
£’000
£’000
£’000 £’000
United Kingdom tax based on the taxable return for the year - - - -
Factors affecting tax charge/(credit) for the year
Return on ordinary activities before taxation (26) 146 (36) 3,063
Tax on above at the company rate of 19% (2021: 19%) (5) 28 (7) 582
UK dividends not subject to corporation tax (13) - (7) -
Realised (Gains)/Losses not taxable - (85) - (56)
Unrealised (Gains)/Losses not taxable - 45 - (535)
Non allowable expenses - - - -
Unutilised/(utilised) losses 18 12 14 9
Current tax charge/(credit) for the year - - - -
The Company has unrelieved losses amounting to approximately £2,255,000
(2021: £2,094,000) which are available to carry forward for tax purposes
which it can set off against future profits. No deferred tax asset has been
recognised in respect of these losses in view of the Company’s history of
losses, and a lack of taxable income, recoverability is not sufficiently
certain.
10. Dividends paid
Year ended Year ended
28 February 2022 28 February
2021
£’000
£’000
Interim dividend paid in respect of FY’21 - 118
Final dividend paid in respect of FY’21 511 -
511 118
A final dividend of 2.0p per share is going to be proposed for the year ending
28 February 2022, which will be subject to shareholder approval at the
Company’s AGM.
A final dividend of 6.5p per share was declared for the year ended 28 February
2021 and this was paid in the year ended 28 February 2022, amounting to
£511k.
An interim dividend of 1.5p per share was declared and paid for the year ended
28 February 2021, amounting to £118k.
No dividend was declared for the year ended 29 February 2020 and,
consequently, no dividend for that year was paid in the year ended 28 February
2021.
11. Return per ordinary share
The negative revenue return, per ordinary share, is based on the net revenue
loss on ordinary activities after taxation of £(26)k (2021: loss £36k) and
on 7,860,937 (2021: 7,860,937) ordinary shares, being the weighted average
number of ordinary shares in issue during the year.
The positive capital return per ordinary share is based on a net realised and
unrealised capital profit of £146k (2021: profit of £3,063k) and on
7,860,937 (2021: 7,860,937) ordinary shares, being the weighted average number
of ordinary shares in issue during the year.
12. Fixed asset investments at valuation
Year ended Year ended
28 February 2022 28 February 2021
£’000
£’000
UK Listed 172 125
AIM 7,076 7,879
AQSE 76 -
Unlisted - -
7,324 8,004
Movements in investments, including realised and unrealised gains and losses,
during the year are summarised as follows:
Year ended 28 February 2022
Unlisted UK listed AIM AQSE Total
£'000 £'000 £'000 £’000 £'000
Valuation at 1 March 2021 - 125 7,879 - 8,004
Purchases at cost - - 300 86 386
Transfers - - - - -
Sales proceeds - (2) (1,276) - (1,278)
Realised gains in period - - 448 - 448
Unrealised (losses)/gains in period - 49 (275) (10) (236)
Valuation at 28 February 2022 - 172 7,076 76 7,324
Cost at 1 March 2021 324 289 6,623 - 7,236
Purchases - - 300 86 386
Transfers - 35 (35) - -
Sales proceeds - (2) (1,276) - (1,278)
Realised (losses)/gains since acq. - (9) 741 - 732
Cost at 28 February 2022 324 313 6,353 86 7,076
Year ended 28 February 2021
Unlisted UK listed AIM Total
£'000 £'000 £'000 £'000
Valuation at 1 March 2020 - 153 4,892 5,045
Purchases at cost - - 683 683
Transfers - - - -
Sales proceeds - - (836) (836)
Realised gains - - 295 295
Unrealised (losses)/gains - (28) 2,845 2,817
Valuation at 28 February 2021 - 125 7,879 8,004
324 289 6,506 7,119
Cost at 1 March 2020
Purchases - - 683 683
Transfers - - - -
Sales proceeds - - (836) (836)
Realised gains since acq. - - 270 270
Cost at 28 February 2021 324 289 6,623 7,236
The overall gain on investments, as shown in the Income Statement, is analysed
as follows:
Year ended Year ended
28 February 28 February
2022 2021
£’000
£’000
Net realised gain on disposal 448 295
Increase in unrealised gain/(loss) (236) 2,817
212 3,112
13. Venture capital investments
A full list of investments held is disclosed in the Investment Portfolio
section, on pages 8 to 10.
14. Significant interests
The Company did not hold more than 10% of the allotted equity share capital of
any class of any investee company.
15. Debtors
Year ended Year ended
28 February 28 February
2022 2021
£’000
£’000
Oberon Investments Limited – uninvested funds 356 123
Unsettled investment disposal at year end 55 -
411 123
16. Creditors: amounts falling due within one year
Year ended Year ended
28 February 28 February
2022 2021
£’000
£’000
Trade creditors and accruals 32 33
32 33
17. Share capital
Year ended Year ended
28 February 2022 28 February 2021
£’000
£’000
Authorised
15,000,000 ordinary shares of 10p each 1,500 1,500
Allotted, called up and fully paid
7,860,937 (2021: 7,860,937) ordinary shares of 10p 786 786
18. Net asset value per share
Net asset value per share is based on net assets at 28 February 2022 of
£7,702,938 (28 February 2021 of £8,093,713) and on 7,860,937 ordinary shares
(2021: 7,860,937 ordinary shares) in issue at those dates.
19. Performance incentive arrangements
The Investment Manager is not entitled to any performance incentive
arrangements.
20. Reserves
Called up share capital represents the nominal value of shares that have been
issued.
Share premium account includes any premiums received on issue of share
capital. Any transaction costs associated with the issuing of shares are
deducted from share premium.
Capital redemption reserve relates to capital repurchased.
Capital reserve – realised. This represents surpluses or deficits on the
disposal of investments and permanent impairment in the value of investments.
Capital reserve – unrealised. This represents surpluses and deficits on the
revaluation of investments which are still held in the portfolio at the end of
the year.
Special distributable reserve. This reserve has been created as a prior year
adjustment to correctly account for the cancelled share premium, which was not
previously transferred to the Revenue reserve in the year ended 28 February
2013, but was instead credited to the ‘Capital reserve – unrealised’
account. The Special distributable reserve is available for distribution and
may be used to cover dividend payments or share buy backs.
Revenue reserve includes all current and prior period retained profits and
losses.
21. Notes to the cash flow statement
Year ended Year ended
28 February
28 February
2022
2021
£’000
£’000
Operating activity
Operating return 120 3,027
Less gain on sale of investments (448) (295)
Less investment income (note 5) (69) (36)
(Less)/plus unrealised (gains)/losses on investments 236 (2,817)
Increase/(decrease) in creditors (note 16) (1) 10
(Increase) in trade debtor (note 15) (55) -
Cash used in operations (217) (112)
Cash and cash equivalents
Cash and cash equivalents comprise £356,250 (2021: £123,089) of uninvested
funds, held in a bank account with the investment manager. This is classified
as a debtor (as per note 15) and is due within one year.
22. Risk management and financial instruments
A statement of the Company’s principal objectives is given within the
Strategic Report on page 6. In order to achieve these objectives the Company
invests its funds primarily in qualifying holdings in unlisted companies and
companies traded on AIM, which by their nature may entail a higher degree of
risk than investments in large listed companies. The Company has not entered
into any derivative transactions, and does not expect to do so in the
foreseeable future. As a Venture Capital Trust, the Company invests in
securities for the long term, and it is the Company’s policy that no trading
in investments or other financial instruments shall be undertaken.
Market price risk
The main risks arising from the Company’s investing activities are market
price risk, representing the uncertain realisable values of the Company’s
investments. The directors aim to limit the risk attaching to the portfolio as
a whole by careful selection of investments and by maintaining a wide spread
of investments in terms of financing stage, industry sector and geographical
location.
The assets of the Company are held for the most part as listed investments
which carry market risk in the form of a single risk variable - market price
movement. The directors do not consider that a risk analysis of that single
risk variable will produce any useful information beyond the obvious that
downward movement in share prices will result in a downward movement in the
share values and vice versa. For this reason, the directors do not consider it
appropriate to prepare a sensitivity analysis to market price movement.
Interest rate risk
The Company finances its activities through retained profits including
realisable capital profits, and through the issue of equity shares. It has not
entered into any borrowings. Details of interest bearing assets are given
below under financial assets.
Liquidity risk
There is liquidity risk associated with unquoted investments, which are not
readily realisable and are included in the financial statements with no value.
Credit risk
Credit risk is the risk of a borrower defaulting on either an interest payment
or the capital sum of a loan. The exposure is limited to uninvested funds held
with the investment manager and the fixed interest loan notes.
Currency risk
The Company’s assets and liabilities are denominated in Sterling. As such,
there is little currency risk. Any transactions in currencies other than
Sterling are recorded at the rates of exchange prevailing at the date of the
transaction. At each reporting date, the monetary assets and liabilities
denominated in foreign currencies are re-translated at the rates prevailing on
the reporting date.
Capital
The Company’s capital is provided in its entirety by its shareholders in the
form of ordinary shares.
The Company’s purpose and objective is the investment of its capital funds
in listed investments, primarily those quoted on AIM with a view to securing
capital appreciation over the long term.
There were no externally imposed capital requirements with which the Company
had to comply during the year to 28 February 2022.
Financial assets
The interest rate profile of the Company’s financial assets is set out
below:
Year ended Year ended
28 February 28 February
2022 2021
£’000
£’000
Floating rate (see note 15) 356 123
Fixed rate - -
Non-interest bearing (see note 12 and 15) 7,379 8,004
7,735 8,127
Fixed rate assets Year ended Year ended
28 February 28 February
2022 2021
Weighted average interest rate - -
Weighted average years to maturity - -
Floating rate financial assets comprise cash held on deposit and investments
in liquidity funds. The benchmark rate for these investments is the UK bank
base rate.
Non-interest bearing financial assets comprises equity share and non-equity
share investments in investee companies, cash held on non-interest bearing
deposit and debtors.
Fair values
The investments of the Company are valued by the directors at their bid prices
(in accordance with the guidelines issued by the British Venture Capital
Association), and these carrying values are considered to approximate the fair
value of the investments. The fair values have also been determined in line
with the fair value hierarchy as set out in FRS 102 11.27.
23. Financial assets and liabilities
Year ended Year ended
28 February 2022 28 February 2021
£’000 £’000
Financial assets measured at fair value 7,379 8,004
Financial assets measured at amortised cost 356 123
Financial liabilities measured at amortised cost (32) (33)
24. Related party transactions
As disclosed in Note 6, New Century AIM VCT plc is managed by Oberon
Investments Limited and is paid a management fee, which is also disclosed in
Note 6.
During the year directors’ remuneration totaled £5,000 (2021: £5,000).
25. Capital commitments
There were no investments which were approved at the year-end but which had
not completed.
26. Control
New Century AIM VCT plc is not under the control of any one party or
individual.
27. Post balance sheet events
The Company’s directors propose to declare a final dividend of 2.0p per
share for the year ending 28 February 2022, amounting to £157,219, which will
be payable, subject to shareholder approval, later this year. The Company’s
directors also intend to pay an interim dividend of 9.0p per share (amounting
to £707,484) for the year ended 28 February 2023.
Shareholder Information
for the year to 28 February 2022
The Company
New Century AIM VCT PLC was incorporated on 4 February 2005 in England &
Wales. In March 2005, the Company obtained a listing on the London Stock
Exchange. A total of £8.465 million was raised (before expenses) through an
offer for subscription of new ordinary shares at 100p. The Company has been
approved as a Venture Capital Trust by HMRC.
The Investment Manager
New Century AIM VCT PLC is managed by Oberon Investments Limited, an
independent fund management company based in Laindon, Essex. Oberon
Investments Limited currently manages or advises investment trust, unit trust
and venture capital funds totalling approximately £25 million including New
Century AIM VCT PLC.
Venture Capital Trusts
Venture Capital Trusts (VCTs) were introduced in the Finance Act 1995 and are
intended to provide a means whereby individual investors can invest in small
unquoted trading companies in the UK, with incentives in the form of a number
of tax benefits. Between the 6th April 2005 and the 5th April 2006, investors
subscribing for new shares in a VCT were entitled to claim income tax relief
of 40% on their investment, irrespective of their marginal tax rate (up to a
maximum investment of £200,000 per tax year). From 6th April 2006, the tax
relief for investors subscribing for new shares, reduced to 30%.The tax relief
cannot exceed the amount which reduces an investor’s income tax liability to
nil. In addition all dividends paid by VCTs are tax free and disposals of VCT
shares are not subject to capital gains tax.
New Century AIM VCT has been approved as a VCT by HMRC. In order to maintain
its approval the Company must comply with certain requirements on a continuing
basis; in particular, at least 80% by value of the Company’s investments
must comprise “qualifying holdings”. A “qualifying holding” consists
of up to £1 million invested in any one year in new shares or securities in
an unquoted company which is carrying on a qualifying trade and whose gross
assets do not exceed £15 million at the time of investment. For the purposes
of these criteria, unquoted companies include companies whose shares are
traded on the Alternative Investment Market (“AIM”).
As with investment trusts, capital gains accruing to VCTs are not chargeable
gains for UK Corporation Tax purposes.
Financial calendar
Annual General Meeting 2022 August 2022
Interim report for six months to 31 August 2022 October 2022
Preliminary announcement of results for the year to 28 February 2023 June 2023
Annual General Meeting 2023 August 2023
Share price
The mid-market price of shares in New Century AIM VCT PLC is available daily
on the London Stock Exchange website (www.londonstockexchange.com
(https://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.londonstockexchange.com&esheet=52766195&newsitemid=20220629005816&lan=en-US&anchor=www.londonstockexchange.com&index=4&md5=fd7a33520ba278a962195aec109834d7)
).
View source version on businesswire.com:
https://www.businesswire.com/news/home/20220629005816/en/
(https://www.businesswire.com/news/home/20220629005816/en/)
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