REG-New Century AIM VCT Plc Final Results <Origin Href="QuoteRef">NECE.L</Origin> - Part 2
30/06/2017 14:10
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financial statements are prepared is
consistent with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following:
Under the International Standards on Auditing (UK and Ireland), we are
required to report to you if, in our opinion, information in the financial
statements is:
* materially inconsistent with the information in the audited financial
statements; or
* apparently materially incorrect based on, or materially inconsistent with, our
knowledge of the company acquired in the course of performing our audit; or
* is otherwise misleading.
Matters on which we are required to report by exception (continued)
In particular, we are required to consider whether we have identified any
inconsistencies between our knowledge acquired during the audit and the
directors’ statement that they consider the annual report fair, balanced and
understandable and whether the annual report appropriately discloses those
matters that we communicated to the Audit Committee which we consider should
have been disclosed.
Under the Companies Act 2006 we are required to report to you if, in our
opinion:
* adequate accounting records have not been kept, or returns adequate for our
audit have not been received from branches not visited by us; or
* the financial statements 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.
Under the Listing Rules we are required to review:
* the directors' statement, set out on page 18, in relation to going concern;
and
* the part of the Corporate Governance Statement relating to the company's
compliance with the nine provisions of the UK Corporate Governance Code
specified for our review; and
* certain elements of the report to the shareholders by the Board on directors'
remuneration.
Colin Jones (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 2017
Statement of Comprehensive Income (incorporating the revenue account) for the
year to 28 February 2017
Year ended Year ended
28 February 2017 29 February 2016
Notes Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Gains on investments
- realised - 514 514 - 282 282
- unrealised - 639 639 - 182 182
Income 5 118 - 118 118 - 118
Investment management fee 6 (17) (52) (69) (19) (57) (76)
Other expenses 7 (54) - (54) (48) - (48)
________ ________ ________ ________ ________ ________
Return on ordinary activities before taxation 47 1,101 1,148 51 407 458
- - - - - -
Tax credit/ (charge) on ordinary activities 9
________ ________ ________ ________ ________ ________
Return on ordinary activities after taxation 47 1,101 1,148 51 407 458
Return per ordinary share (pence) 11 0.55 12.64 13.19 0.54 4.35 4.89
The notes on pages 28 to 37 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 2017
Year ended Year ended
28 February 2017
29 February 2016
£’000
Note £’000
Fixed assets
Investments 12 6,571 5,971
Current assets
Debtors 15 93 443
Current liabilities
Creditors: amounts falling due within one year 16 (31) (27)
6,633 6,387
Capital and reserves
Called up share capital 17 786 863
Share premium 20 682 612
Capital reserve – realised 20 356 1,140
Capital reserve – unrealised 20 3,368 1,483
Capital Redemption Reserve Fund 20 400 313
Revenue reserve 20 1,041 1,976
Total equity shareholders’ funds 6,633 6,387
Net asset value per ordinary share 18 84p 74p
The financial statements on pages 24 to 37 were approved by the Board of
directors on 28th June 2017 and were signed on its behalf by:
Michael Barnard Director
The notes on pages 28 to 37 form an integral part of these financial
statements.
Company’s registered number: 05352611
Statement of Changes in Equity
at 28 February 2017
Share capital Share premium account Capital redemption reserve Capital realised Capital unrealised Revenue reserve Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000
As at 1 March 2015 950 549 217 193 2,023 2,970 6,902
Cancellation of shares (96) - 96 - - (748) (748)
Realised gains on disposals - - - 282 - - 282
Share issue 9 63 - - - - 72
Transfer of unrealised gain to realised on disposal of investment - - - 722 (722) - -
Net revenue before tax - - - - - 51 51
Capital element of investment management fee - - - (57) - - (57)
Dividends paid - - - - - (297) (297)
Unrealised gains - - - - 182 - 182
At 29 February 2016 863 612 313 1,140 1,483 1,976 6,387
Share capital Share premium account Capital redemption reserve Capital realised Capital unrealised Revenue reserve Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000
As at 1 March 2016 863 612 313 1,140 1,483 1,976 6,387
Cancellation of shares (87) - 87 - - (702) (702)
Realised gains on disposals - - - 514 - - 514
Share issue 10 70 - - - - 80
Transfer of unrealised loss to realised on disposal of investment - - - (1,246) 1,246 - -
Net revenue before tax - - - - - 47 47
Capital element of investment management fee - - - (52) - - (52)
Dividends paid - - - - - (280) (280)
Unrealised gains - - - - 639 - 639
At 28 February 2017 786 682 400 356 3,368 1,041 6,633
Cash Flow Statement
at 28 February 2017
Note Year ended Year ended
28 February 2017
29 February 2016
£’000
£’000
Cash flow from operating activities
Cash generated from operations 21 (119) (125)
Net cash generated from operating activities (119) (125)
Cash flows from investing activities
Interest received - 7
Investment income 118 111
Net cash from investing activities 118 118
Cash flows from financing activities
Sale of investments 1,140 2,496
Purchase of investments (587) (1,734)
Share issue 80 72
Dividends paid (280) (297)
Share cancellation (702) (748)
Net cash used in financing activities (349) (211)
Net decrease in cash and cash equivalents (350) (218)
Cash and cash equivalents at the beginning of the year 443 661
Cash and cash equivalents at the end of year 93 443
Notes to the Financial Statements
for the year to 28 February 2017
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 in accordance with applicable
United Kingdom law and accounting standards and with the Financial Reporting
Council’s Financial Reporting Standard FRS 102 and with the Statement of
Recommended Practice for Investment Companies re-issued by the Association of
Investment Companies in November 2014 and updated in January 2017.
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. For this reason, they
continue to adopt the going concern basis in preparing the accounts.
The financial statements are presented in Sterling.
3. Significant estimates and judgements
As the company’s investment holdings, which comprise almost 99% of its total
assets, are stated at market 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 accounts.
4. Accounting policies
Investments
Listed or AIM traded investments are stated at market value, which is based
upon market bid prices at the balance sheet date. 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.
Investments in unquoted companies are valued by the directors in accordance
with British Venture Capital Association (“BVCA”) 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.
4. Accounting policies (continued)
Investments (continued)
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 29 February
2017 2016
£’000 £’000
Interest receivable
- bank deposits and liquid funds - 7
Dividends receivable 118 111
Investment income 118 118
6. Investment management fees
Year ended Year ended
28 February 29 February
2017 2016
Revenue Capital Revenue Capital
£’000
£’000
£’000 £’000
Investment management fees 17 52 19 57
M D Barnard & Co. Limited (“MDB”) 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. Michael Barnard who is a non-executive director of the company is
managing director and proprietor of MDB.
Under the terms of the investment management agreement, MDB 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.
The investment management agreement is for a minimum period of three years
from 24 March 2005 terminable by either party at any time thereafter by one
year’s prior written notice.
7. Other expenses
Year ended Year ended
28 February 29 February
2017 2016 £’000
£’000
Administrative and secretarial services 24 11
Auditor’s remuneration
- 11 10
for audit services
- for tax services - 2
Regulatory fees 12 19
Miscellaneous 7 6
54 48
8. Directors’ remuneration
The chairman received £1,250 remuneration in the year. No other remuneration
has been paid or is payable for the year to 28 February 2017 or in respect of
the prior year.
9. Tax charge/(credit) on ordinary activities
Year ended Year ended
28 February 29 February
2017 2016
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 47 1,101 51 407
Tax on above at the small company rate of 20% (2016: 20%) 9 220 10 81
UK dividends not subject to corporation tax (24) - (22) -
Capital loss on investment - (231) - (101)
Non allowable expenses 1 - 1 -
Unutilised losses 14 11 11 20
Current tax charge/(credit) for the year - - - -
The company has unrelieved losses amounting to approximately £272,000 (2016:
£260,000) 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.
10. Dividends
Year ended Year ended
28 February 2017 29 February 2016 £’000
£’000
Interim dividend paid - -
Final dividend paid in respect of previous year 280 297
280 297
The directors propose a final revenue dividend of 0.55p per share and a final
capital dividend of 2.75p per share for the year ended 28 February 2017 to be
paid on 8 September 2017 to shareholders on the register at 11 August 2017.
11. Return per ordinary share
The revenue return, per ordinary share, is based on the net revenue on
ordinary activities after taxation of £47,487 (2016: £50,806) and on
8,699,558 (2016: 9,376,947) ordinary shares, being the weighted average number
of ordinary shares in issue during the year.
The capital return per ordinary share is based on a net realised and
unrealised capital return of £1,099,958 (2016: £407,621) and on 8,699,558
(2016: 9,376,947) ordinary shares, being the weighted average number of
ordinary shares in issue during the year.
12. Fixed asset investments
Year ended Year ended
28 February 2017 29 February 2016 £’000
£’000
UK Listed 240 290
AIM 6,323 5,670
Unlisted 8 11
6,571 5,971
Movements in investments, including realised and unrealised gains and losses,
during the year are summarised as follows:
Year ended 29 February 2016
Unlisted UK listed AIM NEX Mkts Total
£'000 £'000 £'000 £'000 £'000
Valuation at 1 March 2015 54 346 5,869 - 6,269
Purchases at cost - 89 1,645 - 1,734
Sales proceeds - (149) (2,347) - (2,496)
Realised gains/(losses) - 8 274 - 282
Unrealised gains/(losses) (43) (4) 229 - 182
Valuation at 29 February 2016 11 290 5,670 - 5,971
Cost at 1 March 2015 76 410 7,910 - 8,396
Purchases - 89 1,645 - 1,734
Sales proceeds - (149) (2,348) - (2,497)
Realised gains/(losses) - 25 980 - 1,005
Cost at 29 February 2016 76 375 8,187 - 8,638
12. Fixed asset investments (continued)
Year ended 28 February 2017
Unlisted UK listed AIM NEX Mkts Total
£'000 £'000 £'000 £'000 £'000
Valuation at 1 March 2016 11 290 5,670 - 5,971
Purchases at cost - - 587 - 587
Transfers 18 - (18) - -
Sales proceeds (2) (64) (1,074) - (1,140)
Realised gains/(losses) (5) - 519 - 514
Unrealised gains/(losses) (14) 14 639 - 639
Valuation at 28 February 2017 8 240 6,323 - 6,571
Cost at 1 March 2016 76 375 8,187 - 8,638
Purchases - - 587 - 587
Transfers 317 - (317) - -
Sales proceeds (2) (64) (1,074) - (1,140)
Realised gains/(losses) (48) 10 (694) - (732)
Cost at 28 February 2017 343 321 6,689 - 7,353
The overall gain on investments for the years shown are in the Income
Statement is analysed as follows:
Year ended Year ended
28 February 29 February
2017 2016 £’000
£’000
Net realised gain on disposal 514 282
Increase in unrealised appreciation 639 182
1,153 464
13. Venture capital investments
A full list of investments held is disclosed under Investment Portfolio.
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 29 February
2017 2016 £’000
£’000
Uninvested funds with broker:
M D Barnard & Co. Limited 93 443
16. Creditors: amounts falling due within one year
Year ended Year ended
28 February 29 February
2017 2016 £’000
£’000
Trade creditors and accruals 31 27
31 27
17. Share capital
Year ended Year ended
28 February 2017 £’000 29 February 2016 £’000
Authorised
15,000,000 ordinary shares of 10p each 1,500 1,500
Allotted, called up and fully paid
7,860,937 (2016: 8,634,374) ordinary shares of 10p 786 863
On 31 March 2016 the company issued 100,000 ordinary shares at a price of 80
pence per share.
On 17 February 2017 the company completed a share buy-back of 873,437 ordinary
shares at a price of 80.42 pence per share. Those ordinary shares that were
bought back were cancelled and in accordance with Section 733 of the Companies
Act 2006 a capital redemption reserve was established in respect of the
nominal value of the ordinary share capital being cancelled.
18. Net asset value per share
Net asset value per share is based on net assets at 28 February 2017 of
£6,633,148 (29 February 2016 of £6,387,636) and on 7,860,937 ordinary shares
(2016: 8,634,374 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 represents surpluses or deficits on the disposal
of investments and permanent impairment in the value of investments.
Capital reserve – unrealised represents surpluses and deficits on the
revaluation of investments
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
29 February
2017
2016
£’000
£’000
Operating activity
Operating return 1,148 458
Gain on sale of investments (514) (282)
Investment income (note 5) (118) (118)
Unrealised profits on investments (639) (182)
Increase/(Decrease) in creditors (note 16) 4 (1)
________ ________
(119) (125)
Cash and cash equivalents
Cash and cash equivalents comprise £93,233 (2016: £442,528) of uninvested
funds, held in a bank account with the investment manager.
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. The company’s investment portfolio includes
investments in interest bearing securities in investee companies and in other
fixed interest securities. Details of interest bearing assets are given below
under financial assets.
22. Risk management and financial instruments (continued)
Liquidity risk
There is liquidity risk associated with unquoted investments, which are not
readily realisable.
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.
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 the Alternative Investment
Market 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 2017.
Financial assets
The interest rate profile of the company’s financial assets is set out
below:
Year ended Year ended
28 February 29 February
2017 £’000 2016 £’000
Floating rate 93 443
Fixed rate - 6
Non-interest bearing 5 5
98 454
Fixed rate assets Year ended Year ended
28 February 29 February
2017 2016
Weighted average interest rate - 10%
Weighted average years to maturity - 1.75
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.
22. Risk management and financial instruments (continued)
Fair values
The investments of the company are valued by the directors in accordance with
the guidelines issued by the British Venture Capital Association, and the
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 2017 29 February 2016
£’000 £’000
Financial assets measured at fair value 6,571 5,971
Financial assets measured at amortised cost 93 443
Financial liabilities measured at amortised cost (33) (27)
24. Related party transactions
New Century AIM VCT plc is managed by M D Barnard & Co. Limited. Details
of the relationship and transactions with the related party are included in
note 6.
Key management personnel are considered to be the directors. Details of
remuneration to directors are included in note 8.
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
On 23 June 2017 the directors proposed a dividend in respect of the year ended
28 February 2017 of £259,410 representing 3.30p per ordinary share.
Shareholder Information
for the year to 28 February 2017
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 Investment Manager
New Century AIM VCT PLC is managed by M D Barnard & Co. Limited, an
independent fund management company based in Laindon, Essex. M D Barnard &
Co. Limited currently manages or advises investment trust, unit trust and
venture capital funds totalling approximately £40 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. Investors subscribing for new shares in a VCT are currently
entitled to claim Income Tax relief of 30% on their investment, irrespective
of their marginal rate (up to a maximum of £200,000 per tax year). 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. Conversely,
losses on VCT shares are not allowable to offset against taxable gains.
The company has reached the end of its provisionally approved period and now
complies with the full requirements for approval. In order to maintain its
approval the company must comply with certain requirements on a continuing
basis; in particular, within three years from the date of provisional approval
at least 70% by value of the company’s investments must comprise
“qualifying holdings”, of which at least 30% by value must be in eligible
ordinary shares.
As with investment trusts, capital gains accruing to VCTs are not chargeable
gains for UK Corporation Tax purposes.
Financial calendar
Annual General Meeting 2017 24 August 2017
Interim report for six months to 31 August 2017 published October 2017
Preliminary announcement of results for the year to 28 February 2018 June 2018
Annual General Meeting 2018 August 2018
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
(http://cts.businesswire.com/ct/CT?id=smartlink&url=http%3A%2F%2Fwww.londonstockexchange.com&esheet=51582885&newsitemid=20170630005335&lan=en-US&anchor=www.londonstockexchange.com&index=4&md5=81879675c899b60cf71ad7a0704b8dbc)
).
View source version on businesswire.com:
http://www.businesswire.com/news/home/20170630005335/en/
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