Correction - Annual Financial Report
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THAMES VENTURES VCT 2 PLC
LEI: 21380035MV1VRYEXPR95
07 AUGUST 2024
CORRECTION - FINAL RESULTS FOR THE YEAR ENDED 31 MARCH 2024
The Board notes that the announcement of the Company’s Annual Results, which
was originally made public on 31 July 2024, required amendment. Wording
required under the UK Listing Rules 11.4.1, 6.4.1 and 6.4.3, regarding the
submission of the Annual Results to the National Storage Mechanism, has now
been included at the end of this announcement.
Thames Ventures VCT 2 plc, managed by Foresight Group LLP, today announces the
final results for the year ended 31 March 2024. These results were approved by
the Board of Directors on 31 July 2024.
The Annual Report will shortly be available in full at
www.foresight.group/products/thames-ventures-vct-2-plc. All other statutory
information can also be found there.
Financial Highlights
31 March 2024 31 March 2023
Pence Pence
Ventures Share Class
Net Asset Value (“NAV”) per Ventures Share 46.80 59.4
Cumulative distributions 9.25 8.0
Total Return per Ventures Share 56.05 67.4
Healthcare Share Class
Net Asset Value (“NAV”) per Healthcare Share 41.5 61.60
Cumulative distributions 10.0 8.75
Total Return per Healthcare Share 51.5 70.35
AIM Share Class
Net Asset Value (“NAV”) per AIM Share 101.8 101.1
Cumulative distributions - -
Total Return per AIM Share 101.8 101.1
DSO D Share Class
Net Asset Value (“NAV”) per DSO D Share - 2.6
Cumulative distributions 104.7 102.0
Total Return per DSO D Share 104.7 104.6
DP67 Share Class
Net Asset Value (“NAV”) per DP67 Share 26.3 24.8
Cumulative distributions (since original launch) 67.8 67.8
Total Return per DP67 Share 94.1 92.6
Investment Objectives
The Company’s principal objectives are to:
* invest in a portfolio of venture capital investments and liquidity
investments;
* provide a full exit for Planned Exit Shareholders within approximately six
years at no discount to NAV;
* maintain VCT status; and
* target an annual dividend of at least 4% of the respective Ventures and
Healthcare NAVs, from the summer of 2021 onwards.
Chair’s Statement
Introduction
I present the Company’s audited Annual Report for the year ended 31 March
2024, which has been a difficult period for the Company.
Before commenting on events from the last financial year, I would first like
to take the opportunity to highlight two key developments that have taken
place since year end.
Firstly, as announced on 26 July 2024, I am pleased to report that the Company
has entered discussions to merge with Thames Ventures VCT 1 plc (“TV1”).
If approved by Shareholders of both companies, this merger would achieve costs
savings, administration efficiency and increased scale - including access to
more capital to deploy, which is a critical capability to protect and enhance
value for Shareholders.
If the transaction proceeds, it is anticipated that each of the Company’s
current Share Classes would roll into the Ordinary Share Class of TV1. The
Board is cognisant of ensuring we act in the best interest of all Shareholders
across our four remaining Share Classes, and, assuming the Boards of both
companies agree terms, we anticipate formally announcing details of the
structure of the proposed transaction and the benefits it would bring to all
Shareholders within the next two months, with the transaction completing in
the early Autumn.
Secondly, as Shareholders may be aware, the Company’s custodian of its
quoted assets, IBP Capital Markets Limited (“IBP”), was put into special
administration by the FCA in October 2023. Since then, the Investment Manager
has been actively collaborating with the Joint Special Administrators
(“JSA”) to achieve a resolution. I am pleased to inform Shareholders that
last week we were granted access to c. 80% of the Company’s quoted assets
again following an interim distribution by the JSA to our new custodian, with
the remainder to follow in due course. A small provision of c. £80,000 has
been made in the accounts to cover losses and costs of the JSA. Further
details are provided later in my report below and in note 17 of the Annual
Report and Accounts.
Turning to the year ended 31 March 2024, we have continued to see a
challenging investment environment for small growth businesses. However, there
have been some early signs of recovery in the UK market with decreasing
inflation. Our focus has been to preserve value in our existing portfolio and
to that end we have temporarily reduced dividends and suspended share buybacks
to preserve cash.
Evergreen Share Class review
Ventures Share Class
With the challenging macroeconomic environment, a key focus for the Ventures
Share Class portfolio over the year has been to support existing investments,
where possible. During the year, £0.5 million was invested in four companies,
three of which were existing portfolio investments.
The Ventures Share Class NAV at the year-end was 46.8p, representing a
decrease of 11.35p per share or 19.1% over the year. This is after adding back
the dividend of 1.25p per share, which was paid on 29 September 2023.
There has been a general decline in the portfolio valuations across the year,
in line with sector trends of lower revenue and earnings multiples, due to
economic concerns. Total valuation losses for the year were £5.3 million,
however this was materially driven by two exceptional situations. The first of
these was Cornelis Networks Inc, which decreased in value by £2.8 million, as
a result of a round closing in the year which had very aggressive terms for
those unable to participate. This was the case for the Company as the business
was no longer VCT-qualifying, meaning under VCT rules, we were unable to
invest further cash. The second write down was Limitless Technology Limited,
which decreased in value by £0.7 million, as a result of one of the
co-investors being on the UK sanctions list following the Russian invasion of
Ukraine. This meant the business was unable to raise capital and, despite
exploring all other options, it was eventually forced into administration.
Further details on these investments are included in the Investment
Manager’s Report on page 12 of the Annual Report and Accounts.
There were four full exits during the year, including the liquidity investment
Downing Strategic Micro-Cap Investment Trust plc, generating total proceeds of
£5.2m and a realised loss versus cost of £1.5 million. There were also three
companies that were dissolved in the year taking total realised losses to
£3.6 million.
A more detailed review of the Ventures Share Class is included in the
Investment Manager’s Report on pages 10 to 13 of the Annual Report and
Accounts.
Healthcare Share Class
The Healthcare Share Class, which continues to be managed by Downing LLP, had
a limited level of investment over the year with one investment of £0.25
million made into TidalSense Limited (formerly Cambridge Respiratory
Innovations Limited), an existing investment. There were, however, a total of
four full and partial exits, generating total proceeds of £1.1 million.
The Healthcare Share Class NAV at the year-end was 41.5p, representing a
decrease of 18.85p per share or 30.6% over the year after adjusting for the
Healthcare dividend of 1.25p per share, which was paid on 29 September 2023.
The Healthcare Share Class remains heavily exposed to the relatively volatile
AIM market, with nearly 30% of the Class’s value accounted for by the three
AIM-quoted investments. All of these investments: Arecor Therapeutics plc,
GENinCode plc and Destiny Pharma plc, decreased further in valuation during
the year, making up £2.0 million of the £4.1 million total valuation loss.
The remaining £2.1 million valuation loss was driven by further write-downs
including in Congenica Ltd (£0.9 million), Invizius Limited (£0.5 million),
The Electrospinning Company Limited (£0.4 million) and TidalSense Limited
(£0.3 million).
A more detailed review of the Healthcare Share Class is included in the
Investment Manager’s Report on pages 21 to 22 of the Annual Report and
Accounts.
AIM Share Class
The AIM Share Class launched in 2022 and is a small Class with net assets of
£2.7 million. The AIM market remains tough meaning no AIM investments were
made in the year, although funds have been placed in a money market fund and
an equity income fund. This Share Class has demonstrated good performance
relative to other AIM funds during the year.
The AIM Share Class NAV stood at 101.8p at the year end, representing an
increase of 0.7p per share or 0.7% in NAV over the year.
Planned Exit Share Class review
I am pleased to report that the wind up of the DSO D Share Class is now
complete with a total return of 104.7p per share, before tax relief, now
distributed to Shareholders. As at 31 March 2024, there remains just one
Planned Exit Share Class, DP67.
DP67 Share Class
The remaining value in the DP67 Share Class portfolio is in two investments
which are both in the hospitality sector.
As at 31 March 2024, the DP67 Share Class NAV stood at 26.3p and Total Return
stood at 94.1p per share, an increase of 1.5p per share, equivalent to 1.6% in
Total Return terms since 31 March 2023.
Gatewales has ceased trading and we are expecting final proceeds in the near
future.
Cadbury House Holdings Limited owns a four-star boutique hotel, conference
centre and leisure facility in Congresbury, Bristol. The property has been
actively marketed for sale for some time now, however the current market is
weak, and the Investment Manager is keen to avoid a sale at undervalue. Whilst
there have been offers received during the year, the Company took the decision
not to accept these in order to secure the best possible return for
Shareholders. The investment remains held at the same value as reported at the
end of last year and loan interest continues to be recognised in full,
providing the Share Class with £194,000 of income during the year, with this
balance included within debtors at year end.
A more detailed review of the DP67 Share Class is included in the Investment
Manager’s Report on page 33 of the Annual Report and Accounts.
DSO D Share Class
The exit from the two final assets in this Share Class completed during the
year with £39,000 of liquidation proceeds received.
The Share Class has since been fully wound up with final distributions made to
shareholders. A more detailed review of the DSO D Share Class is included in
the Investment Manager’s Report on page 31 of the Annual Report and
Accounts.
Responsible investment
The Board notes the commitment of the Investment Manager, Foresight Group, to
being a “Responsible Investor”. Foresight places Environmental, Social and
Governance (“ESG”) criteria at the forefront of its business and
investment activities in line with best practice and in order to enhance
returns for their investors.
Further detail on the Investment Manager’s approach to responsible
investment, including the key principles and their screening approach, can be
found on pages 38 to 40 of the Annual Report and Accounts.
Special Administration of the Company’s Custodian of Quoted Assets
As previously reported, since March 2022, the Company has used IBP Capital
Markets Limited ("IBP") as custodian for its quoted investments. Appointing a
custodian is a requirement of the FCA, and IBP is an FCA authorised and
regulated wholesale broker, providing custody services and access to equity
and fixed income securities for non-retail clients (which includes the
Company). On 13 October 2023, the FCA published a supervisory notice under
section 55L(3)(a) of the Financial Services and Markets Act 2000, imposing
certain restrictions on IBP. On the same date, IBP applied to the High Court
and special administrators were appointed.
As noted earlier in my report, the Investment Manager has been working to
resolve this issue, which has involved reconciling quoted stocks (“Custody
Assets”) and cash (“Client Money”) held with IBP. As at 13 October 2023,
the Company held Client Money of £26,379, all within the Healthcare Share
Class (0.2% of indicative Healthcare NAV on the same date), and Custody Assets
of £8,448,179 split between the Ventures Share Class: £3,127,539; Healthcare
Share Class: £3,406,697; and AIM Share Class: £1,913,943.
As at 31 March 2024, regarding Custody Assets, all quoted holdings were
reconciled and regarding Client Money the Company has been notified of a
potential 44% cash shortfall, equating to £11,607 impacting the Healthcare
Share Class only. This has been provided for. Further to this, fees to the
special administrators in the region of £68,000 have been accrued, split
between the relevant Share Classes. The total exposure to the Company is
therefore anticipated to be around £80,000. Full details are provided in note
17 on page 99 of the Annual Report and Accounts.
The ultimate outcome remains subject to change, with the final distribution
plan being shared following the court proceedings, timing of which is
currently uncertain. The Company will communicate with Shareholders if there
is any new information which materially impacts the numbers presented in this
Annual Report.
VCT Qualification
At 31 March 2024, qualifying investments represented 89.6% of total
investments (including cash). The Board expects that the minimum VCT
qualification level of 80% will continue to be maintained for the foreseeable
future.
Fundraising
With the uncertainty brought about by the special administration of the
custodian of the Company’s quoted stocks, we have not been in a position to
raise new funds since then.
With visibility over the outcome of the IBP situation now improved, and
discussion underway for a merger with TV1, the strategic direction of the
Company with regards to fundraising will be communicated with Shareholders in
the near future.
Dividends
The Company has a target of seeking to pay annual dividends for the Ventures
and Healthcare Share Classes of 4% of the respective NAVs per annum, however
this is contingent on a number of criteria, including cash availability.
On this basis, given the current focus on preserving cash, the Board is
proposing to pay reduced final dividends of 0.25p per Ventures Share and 0.25p
per Healthcare Share on 18 October 2024, to Shareholders on the register as at
4 October 2024. The proposed dividends are subject to Shareholder approval at
the forthcoming AGM.
Following the payment of the proposed dividends, the Company will have paid
cumulative dividends of 9.5p per Ventures Share and 10.25p per Healthcare
Share.
Further dividends in respect of the DP67 Share Class will be paid once Cadbury
House has been exited. No dividends are expected to be paid by the AIM Share
Class in its initial years.
Share buybacks
The Company usually operates a policy of buying back its own shares that
become available in the market, subject to regulatory and liquidity factors.
The Board reviews this policy on a regular basis and will make appropriate
adjustments as it sees fit. Any such purchases are undertaken at a price
approximately equal to NAV (i.e. at a nil discount).
Following a period of uncertainty relating to IBP, the Board decided to pause
the buyback scheme. Whilst there is now improved visibility regarding the
outcome of the IBP situation, and the impact to the Company is expected to be
minimal, restrictions on cash resources remain. On this basis, the Board has
decided not to reinstate share buybacks for the Ventures, Healthcare and AIM
Share Classes at this time. The Board, however, continues to review plans for
the future of the Company, notably with regards to the proposed merger with
TV1, which will allow a clear strategy for the allocation of the Company’s
cash resources to be drawn up.
As the focus for the one remaining Planned Exit Share Class is on returning
funds to Shareholders via distributions, the Company will not undertake any
further buybacks in respect of this Share Class.
Panmure Liberum continues to act as the Company’s corporate broker,
operating the share buyback process and ensuring that the quoted spread on the
Company’s shares remains at a reasonable level.
There were no shares repurchased for the Ventures or Healthcare Share Classes
during the year ended 31 March 2024.
Change of Company Secretary and Registered Office
As previously reported, Foresight Group LLP was appointed as Company Secretary
effective from 12 September 2023, succeeding Grant Whitehouse. I would like to
take this opportunity to thank Grant for his many years of loyal service.
Annual General Meeting (“AGM”)
The Company invites Shareholders to attend this year’s AGM in person. The
AGM is planned to take place at the offices of Foresight Group LLP, The Shard,
32 London Bridge Street, London, SE1 9SG at 4.00 p.m. on 24 September 2024.
Shareholders wishing to attend the AGM are requested to please notify
Foresight Group LLP via email, to InvestorRelations@foresightgroup.eu, in case
there are changes to arrangements which need to be communicated at short
notice.
This year, Shareholders will be able submit proxy votes electronically. The
details required for voting will be sent to each Shareholder. The deadline for
proxy votes to be received is 4.00 p.m. on 20 September 2024.
Outlook
Although the main Share Classes have seen their portfolios fall in value over
the year, these movements are in line with general market conditions for young
growth businesses. The Board is cognisant that it takes time to nurture and
realise value from companies, whereas economic turmoil pushes weaker companies
into difficulty.
Whilst the Board acknowledges it has been another difficult year, resulting in
a continuing decline in NAV, there have been some early signs of recovery with
a number of interesting developments in the portfolio. The Board remains
generally satisfied that the Ventures and Healthcare portfolios have a
sufficient number of stronger investments to generate growth in the future.
The Board and the Investment Managers have continued to focus on securing
exits in the portfolio, in particular of the legacy investments, to drive
liquidity events. An example of this was the sale of Downing Strategic
Micro-Cap Investment Trust plc, following disappointing performance. This
generated more than £3.3 million of cash.
In respect of the Planned Exit Share Classes, the Board is very pleased to
confirm the full winding up of the DSO D Share Class in the year and is
hopeful the DP67 Share Class will follow in the coming year.
As previously noted, the Board has been actively considering options for the
future of the Company, looking to pursue any that it concluded may benefit
Shareholders and allow the Company to be better placed to serve them.
Following the announcement made on 26 July 2024 that the Company is actively
considering merging with TV1, the Board is very much looking forward to this
next chapter and the benefits it will undoubtedly bring to Shareholders. I
will, of course, report any significant developments to this end to
Shareholders as things progress.
Sir Aubrey Brocklebank Bt.
Chair
31 July 2024
Investment Manager’s Report - Ventures Share Class
i. Overview
Introduction
We present a review of the investment portfolio and activity for the Ventures
Share Class for the year ended 31 March 2024.
This Investment Manager’s Report is split into three sections comprising
this overview, a review of the Ventures Capital portfolio and a report on the
portfolio of Liquidity Investments.
Net Asset Value and results
As at 31 March 2024, the Ventures Share NAV at the year-end was 46.8p,
representing a decrease of 11.35p per share or 19.1% over the year. This is
after adding back the dividend of 1.25p per share, which was paid on 29
September 2023.
The return on ordinary activities for the Ventures Share Class for the year
was a loss of £6.0 million (2023: loss of £3.2 million), comprising a
revenue loss of £566,000 (2023: loss of £494,000) and a capital loss of
£5.5 million (2023: loss of £2.7 million).
It is disappointing to report the Total Return to Shareholders as at 31 March
2024 of 56.05p which continues to be considered an underperformance against
our expectations for the Ventures Share Class.
A final dividend of 0.25p per share is proposed to be paid on 18 October 2024,
to Shareholders on the register at 4 October 2024.
Portfolio Overview
As at 31 March 2024, the Ventures Share Class held a portfolio of 32 Venture
Capital investments with a total value of £17.8 million. The one Liquidity
investment brought forward, Downing Strategic Micro-Cap Investment Trust plc
(“DSM”), was sold on 26 March 2024.
The year has continued to be challenging for businesses in the UK and
internationally, caused by the impact of the economic downturn with rising
rates of inflation and interest. However, whilst it remains early days, there
have been some recent signs of potential recovery with some interesting
updates across the portfolio, in particular with regards to access to capital
and fund raising.
The investment team continue to work closely with portfolio companies to
provide guidance and, where appropriate, additional funding in support of
potential value growth which has made up the majority of investment activity
in the year ended 31 March 2024.
The valuation movements during the period are discussed in more detail in the
following sections of this Investment Manager’s Report.
Portfolio Performance
Overall, several valuation uplifts in the Venture Capital Portfolio were
outweighed by a number of valuation decreases during the period, resulting in
a net valuation decrease of £5.3 million across the portfolio. The one
Liquidity Investment brought forward was exited during the year, details of
which are provided in the disposal table on page 37 of the Annual Report and
Accounts.
ii. Ventures Portfolio
Investment activity
During the year, a total of £0.5 million was invested in four businesses,
three of which were follow-on investments into existing portfolio companies.
New Ventures investments
A total of £0.1 million was invested into new VCT Qualifying investment, EM
Scientific Limited (trading as Inoviv), during the year. Inoviv has a
long-term data play in drug discovery and trials, having developed novel
precision biomarker technology which helps pharmaceutical customers run drug
trials more efficiently. This investment will enable Inoviv to further
accelerate their commercial plans, including facilitating the development of
tests across more diseases.
Follow-on Ventures investments
A total of £0.4 million was invested as follow-on capital into existing
businesses in the Venture Capital Portfolio.
These were £200,000 into Cambridge Touch Technologies Ltd, a company
developing pressure sensitive multi touch technology, £150,000 into Maestro
Media Limited, a talent-led, e-learning media platform of multichannel
e-commerce technology and £50,000 into Virtual Class Ltd (trading as Third
Space Learning), a platform offering personalised online lessons from
specialist tutors.
Realisations
There were three full exits during the year from the Venture Capital portfolio
and one full exit from the Liquidity investments. Total proceeds of £5.2
million were generated, producing a realised loss over cost of £1.5 million.
There were also three dissolutions in the year taking total realised losses to
£3.6 million.
Imagen Limited is a Software as a Service (“SaaS”) video management
platform which holds both current and archive footage for major sporting
organisations and news outlets. The company was sold for initial cash
consideration of £1.7 million at a gain over cost of £0.7 million. There was
also £0.2 million of deferred consideration received taking total proceeds to
£1.9 million and a total gain over cost of £0.9 million.
There was also £450,000 received in relation to the exit of Maverick Pubs
(Holdings) Limited. This was a distribution of capital reserves following the
sale of this real estate development company. Maverick Pubs (Holdings) was
seeking to build quality freehold pubs in and around London, however it was
adversely impacted by the COVID pandemic, being forced to shut sites, and the
subsequent impact of the UK economic downturn. The Company had invested £1.0
million, resulting in realised losses of £550,000.
LineTen Limited was also sold in the period generating nil return on the
£400,000 investment.
The one brought forward liquidity investment in Downing Strategic Micro-Cap
Investment Trust plc (“DSM”) was liquidated in full during the year,
returning cash proceeds of £2.9 million. Previous to this, DSM announced that
the fund was going to commence a managed wind-down of its portfolio, therefore
this outcome is preferential to the Company in terms of unlocking liquidity.
This exit resulted in a realised loss over cost of £1.4 million.
Portfolio valuation
During the year, the Venture Capital portfolio of the Ventures Share Class
recognised a decrease in the valuation of investments of £5.3 million,
including unrealised foreign exchange losses of £124,000.
Whilst there have been a number of positive developments within the Venture
Capital portfolio, this was offset by the reduction in value of several
companies, predominantly due to underperformance in a challenging
macroeconomic environment and restricted access to capital. Of the £5.3
million total valuation loss, the most significant movements are noted below.
The largest gain in value was in Funding Xchange Limited, a fintech platform
delivering SME lenders insights into their portfolio trends, was uplifted
£591,000 during the year as a result of closing a £5m investment from
Barclays in February 2024 as part of the company’s Series B funding round.
This revaluation is the result of a calibration to the price set by this
funding round.
Masters of Pie Limited, developer of “Radical”, a software solution that
enables remote sharing and collaboration on large data sets, was uplifted by
£369,000 as a result of improved performance following some significant
contract wins.
Carbice Corporation, which has developed a suite of products based on its
carbon material called Carbice Carbon, is primarily used as thermal management
solutions to enable greater thermal conductivity. The valuation was increased
by £352,000, as a result of the company accessing more capital in the year
and launching its Series B funding round.
Cambridge Touch Technologies Ltd, a company developing pressure sensitive
multi touch technology, was uplifted £116,000 during the year as a result of
a funding round which closed in June 2024, which the VCT participated in. This
revaluation is the result of a calibration to the price set by this funding
round.
Maestro Media Limited (trading as BBC Maestro), a talent-led, e-learning media
platform of multichannel e-commerce technology, increased in value by
£110,000 as a result of a calibration to the price set by a funding round
during the year, supported by a strong trading year.
Trinny London Limited, a cosmetics and skincare brand, was uplifted by
£102,000 due to increased confidence in consumer spending and improved
trading performance during the year.
Six other investments in the Venture Capital portfolio make up additional
investment valuation gains of £410,000.
There were also a number of valuation losses recognised during the year. Some
of these came from the more vulnerable businesses within the portfolio,
however there were two material movements in the year that were exceptional
circumstances and out of the investment team’s control.
These were Cornelis Networks Inc. (£2.8 million, including foreign exchange
losses) and Limitless Technology Limited (£703,000).
Cornelis Networks Inc., which delivers purpose-built high-performance fabrics
for High Performance Computing (“HPC”), High Performance Data Analytics
(“HPDA”) and Artificial Intelligence (“AI”), went through an internal
funding round in the year, which resulted in existing investors who were
unable to participate being heavily diluted. The VCT was unable to participate
as the company exceeded the VCT-qualification threshold for gross assets,
meaning the VCT’s position was severely impacted, which is reflected in the
year-on-year movement in valuation.
Limitless Technology Limited, the developer of a crowdsourced customer service
platform, was unable to access additional capital as a result of one of the
co-investors being on the UK Sanctions List following the Russian invasion of
Ukraine. This ultimately resulted in the company going into administration and
the carrying value has therefore been written down to nil.
Other investment valuation decreases include Hackajob Ltd, a recruitment
platform for technical hires, which was revalued downwards by £651,000 to
account for trading headwinds in the UK as a result of the challenging
economic environment.
Congenica Ltd, which has developed a genomics-based diagnostic decision
support platform which helps doctors identify rare diseases in patients, has
been written down to nil in the year. This led to a valuation decrease of
£605,000, as a result of its struggle to raise funding. As a result,
Congenica has entered a sales process but it is highly unlikely there will be
any return to the Company.
Upp Technologies Group Ltd, a provider of multichannel e-commerce technology,
was decreased in value by £442,000 as a result of a calibration to the price
set by a funding round during the year.
Virtual Class Ltd, (trading as Third Space Learning), a platform offering
personalised online lessons from specialist tutors, decreased in carrying
value by £425,000 during the year. This was driven by a challenging market in
the UK, with the government recently announcing the National Tutoring
Programme will not be extended.
CommerceIQ Inc, the pioneer in helping brands win on retail e-commerce
channels, decreased in value by £417,000 during the year, including foreign
exchange losses. The company continues to perform well, growing revenues
during the period and supported by a very strong balance sheet. This valuation
movement is therefore simply a reflection of wider market conditions.
Arecor Therapeutics plc has fallen in value by £378,000. This investment is
listed on AIM and is a leader in developing superior biopharmaceuticals
through the application of its innovative formulation technology platform. The
valuation is marked to market and this movement is reflective of a flat
trading year. We eagerly await further clinical readouts and partnering
opportunities.
Parsable Inc., a provider of software to improve operational efficiencies in
the industrial and manufacturing sectors, has also been impacted by the
macroeconomic environment. Losing a significant customer has led to a
valuation decrease of £347,000, including foreign exchange losses.
Rated People Limited, an online marketplace connecting homeowners and local
tradespeople, reduced in carrying value by £236,000, as a result of trading
headwinds and access to capital.
There were four other investments which decreased in valuation during the year
totalling losses of £356,000.
Aside from Limitless Technology Limited and Congenica Ltd, there were no
further investments written down to nil in the year.
iii. Liquidity Investments
As noted, the one remaining investment in the Healthcare Liquidity portfolio
was DSM which was sold on 26 March 2024, returning cash proceeds of £2.9
million. There are no further Liquidity Investments.
Outlook
It has been another challenging year for the Venture Capital market, and
especially for certain sectors the Company invests in. Having said that, more
recently there have been a few very early signs of some recovery in the market
so we are hopeful this will continue through the next financial year.
The Investment Manager continues to review plans for the future of the Company
notably with regards to the proposed merger with Thames Ventures VCT 1 plc,
which will allow a clear strategy for the allocation of the Company’s cash
resources to be drawn up.
Foresight Group LLP
31 July 2024
An investment summary is shown on page 14 of the Annual Report and Accounts.
Top ten investments by value are shown on pages 15 to 18 of the Annual Report
and Accounts.
Additions and disposals for the year ended 31 March 2024 are shown on pages 36
and 37 of the Annual Report and Accounts.
Healthcare Share Class
Investment Manager’s Report - Healthcare Share Class
i. Overview
Introduction
We present a review of the investment portfolio and activity for the
Healthcare Share Class over the year ended 31 March 2024.
This Investment Manager’s Report is split into three sections comprising
this overview, a review of the Healthcare Portfolio and a report on the
portfolio of Liquidity Investments.
Net Asset Value and results
As at 31 March 2024, the NAV of a Healthcare share stood at 41.5p, a decrease
of 18.85p (30.6%) over the year after adding back the Healthcare dividend, of
1.25p per share, which was paid on 29 September 2023.
The loss on ordinary activities for the Healthcare Share Class for the year
was £4.5 million (2023: loss of £4.3 million), being a revenue loss of
£328,000 (2023: loss of £272,000) and a capital loss of £4.2 million (2023:
loss of £4.0 million).
The Total Return to Shareholders as at 31 March 2024, of 51.5p, continues to
be considered an underperformance against our expectations for the Healthcare
Share Class.
A proposed final dividend of 0.25p per share will be paid on 18 October 2024,
to Shareholders on the register at 4 October 2024.
Portfolio Overview
As at 31 March 2024, the Healthcare Share Class held a portfolio of twelve
Healthcare investments valued at £7.3 million. The one Liquidity investment
brought forward, Downing Strategic Micro-Cap Investment Trust plc (“DSM”),
was sold on 26 March 2024.
Portfolio Performance
There were several valuation movements in the Healthcare Portfolio during the
year, resulting in a total valuation loss of £4.1 million.
ii. Healthcare Portfolio
Investment activity
During the year, £250,000 was invested in one business, a follow-on
investment into existing investee company, TidalSense Limited (formerly
Cambridge Respiratory Innovations Limited). TidalSense is a leading MedTech
company that creates ground-breaking respiratory technologies.
There were full and partial disposals of four investments during the year,
excluding dissolutions, with total proceeds received of £1.1 million.
Full disposals in the year were:
DiA Imaging Analysis Limited, a developer and seller of AI ultrasound imaging
analysis solutions with the aim of assisting current operators and reducing
the experience and technical know-how required for future operators, was sold
in May 2023 with cash proceeds of £393,000. The Company continues to
recognise £91,000 of deferred consideration related to the exit.
Adaptix Limited, a MedTech 3D X-ray business, was sold during the year to
Avingtrans plc in exchange for shares in this quoted company. The Company then
made a decision to liquidate this holding, returning cash proceeds of
£212,000 to the Company.
The one brought forward liquidity investment in DSM was liquidated in full
during the year, returning cash proceeds of £487,000. Previous to this, DSM
announced that the fund was going to commence a managed wind-down of its
portfolio, therefore this outcome is preferential to the Company in terms of
unlocking liquidity.
There was one partial disposal of quoted investments, GENinCode plc, returning
cash proceeds of £30,000. GENinCode products combine genetic and clinical
data to risk assess patients and
provide healthcare practitioners with advanced clinical information to
evaluate and predict the onset of cardiovascular disease.
Portfolio valuation
During the period, the Healthcare portfolio of the Share Class decreased in
value by a total of £4.1 million.
Excluding disposals and three investments recording no movement in valuation,
all but one of the investments decreased in value during the period, totalling
valuation losses of £4.2 million across eight investments. The one investment
which increased in value was MIP Discovery Limited. This company designs and
produces synthetic affinity reagents for detection, capture and purification
of viral vectors in cell and gene therapy. The valuation increase of £16,000
was as a result of a funding round which closed and to which the valuation is
calibrated to. Valuation movements on disposals totalled gains of £67,000
across three investments.
The valuation losses relate to:
Arecor Therapeutics plc (£1.4 million), is listed on AIM and is a leader in
developing superior biopharmaceuticals through the application of its
innovative formulation technology platform. The valuation is marked to market
and this movement is a result of the wider macroeconomic challenges.
Congenica Ltd (£865,000), has developed a genomics-based diagnostic decision
support platform which helps doctors identify rare diseases in patients. This
investment has been written down to nil in the year as a result of its
struggle to raise funding. As a result, Congenica has entered a sales process,
but it is highly unlikely there will be any return to the Company.
GENinCode plc (£622,000) is listed on AIM and therefore marked to market.
This decrease in valuation is considered to be a result of the wider
macroeconomic challenges.
Invizius Limited (£499,000) is developing novel primers with the aim of
reducing adverse inflammatory responses. The decrease in valuation of this
investment is driven by Invizius’ need to fundraise with access to capital
being very challenging in the current market. Invizius has, however, completed
its clinical trial with data showing that it meaningfully improves the
biomarker profile of patients using its product.
The Electrospinning Company Limited (£408,000) is a supplier and manufacturer
of clinical-grade biomaterials. This investment has also decreased in
valuation as a result of the challenges to access capital.
TidalSense Limited (formerly Cambridge Respiratory Innovations Limited)
(£262,000) was written down in the period as a result of the company
requiring additional funding, which is likely to be an internal round, however
TidalSense continues to make strong progress and build partner traction with
Big Pharma.
There were two other investments which decreased in valuation during the year
totalling losses of £177,000.
iii. Liquidity Investments
As noted, the one remaining investment in the Healthcare Liquidity portfolio
was DSM which was sold on 26 March 2024, returning cash proceeds of £487,000.
There are no further Liquidity Investments.
Outlook
Macroeconomic factors continue to impact the financial markets with a knock-on
impact on the venture capital funding environment as many venture funds choose
to focus on supporting their existing portfolios rather than looking to add
new positions. This has been the case for the Healthcare Share Class, and
access to capital has also been a material challenge for much of the
portfolio.
There are, however, some investments in the portfolio starting to make
commercial progress and could therefore become attractive targets, as
evidenced by some of the exits in the year. The investment team will continue
to focus on extracting value from the existing portfolio wherever possible.
Downing LLP – Healthcare Ventures Team
31 July 2024
An investment summary is shown on page 23 of the Annual Report and Accounts.
Top five investments by value are shown on pages 24 and 25 of the Annual
Report and Accounts.
Additions and disposals for the year ended 31 March 2024 are shown on pages 36
and 37 of the Annual Report and Accounts.
AIM Share Class
Investment Manager’s Report - AIM Share Class
Introduction
The fundraising for the AIM Share Class was launched in August 2021 at a time
when markets were performing well, as the economy started to rebound from the
release of the constraints of the pandemic. At that time, we were seeing a
steady flow of potentially attractive IPOs on AIM which were eligible for
investment by VCTs.
The world has changed dramatically since then with the conflict in Ukraine,
the Middle East, Gaza and Israel, increased tensions between China and Taiwan,
political uncertainty, recessionary fears, continued high inflation and
increasing interest rates combining to shake investor confidence, resulting in
an extended period when there were no suitable investment opportunities for
the Share Class.
In view of the lack of AIM-IPOs we invested a proportion of the funds raised
in a cash fund and equity income fund looking to produce some returns from the
uninvested funds.
Net Asset Value and results
As at 31 March 2024, the NAV of an AIM share stood at 101.8p, an increase of
0.7p (0.7%) over the year.
IBP Capital Markets Limited
Since it was announced on 13 October 2023 that IBP Capital Markets Limited
(“IBP”), the custodian of the Company’s quoted investments, was entering
Special Administration, the Investment Manager has been unable to trade any of
the quoted stocks.
The Investment Manager has been actively collaborating with the special
administrators to reconcile the quoted positions, and is pleased to report no
differences of value in quoted holdings have been identified as at 31 March
2024.
As noted in the Chair’s Statement and note 17 of the Annual Report and
Accounts, the Company has recently recovered c.80% of the eligible quoted
portfolio, with the remaining c.20% expected to be recovered following court
proceedings. Whilst the outcome remains subject to change, the Company will be
able to return to normal management of the portfolio following this initial
distribution.
Outlook
Despite the frustrations of not being able to invest the Share Class’s funds
as planned, it is pleasing to be able to report a positive return when, over
the same period, the AIM market in general has suffered substantial losses.
With the challenge of investing the Share Class’s funds and the fact that
the class is very small in size, we are discussing plans for the future of the
class with the Board and seeking to find a strategy which is in
Shareholders’ best interests.
Downing LLP
31 July 2024
An investment summary is shown on page 29 of the Annual Report and Accounts.
DSO D Share Class
Investment Manager’s Report - DSO D Share Class
Introduction
Proceeds from the two remaining investments in this Share Class were received
in the year ended 31 March 2024 and all funds have been returned to DSO D
Shareholders, with the Share Class now formally wound up.
Investments
As at 31 March 2023, the DSO D Share Class held two investments, Pearce and
Saunders Limited and Pearce and Saunders DevCo Limited, with a total value of
£16,000. The final pub was sold some time ago and an Insolvency Practitioner
was appointed to distribute funds via a liquidation.
During the year ended 31 March 2024, final distributions were made returning
£39,000 in liquidation proceeds from Pearce & Saunders Limited. There were no
further distributions from Pearce and Saunders DevCo Limited.
Return to Shareholders
On 28 March 2024, the Company announced that it had completed a programme of
returning funds to holders of the DSO D Shares, culminating with dividend
payments of 2.7p per DSO D Share paid on 28 March 2024.
Following the payment of this dividend, the Company has now returned all the
capital associated with the DSO D Shares to Shareholders and divested of all
investments held in the portfolio, with the payment of the dividend marking
the end of the life cycle of the DSO D Shares.
Foresight Group LLP
31 July 2024
Additions and disposals for the year ended 31 March 2024 are shown on pages 36
and 37 of the Annual Report and Accounts.
Investment Manager’s Report - DP67 Share Class
Introduction
The process of seeking to realise the remaining investments for optimal
proceeds and returning funds to DP67 Shareholders continues.
Net Asset Value and results
The Net Asset Value (“NAV”) per DP67 Share at 31 March 2024 stood at
26.3p, an increase of 1.5p or 1.6% in Total Return terms during the year.
Total Return stands at 94.1p per DP67 Share, compared to initial cost to
Shareholders, net of income tax relief, of 70.0p per share. Compared to the
initial NAV of 100.0p, we consider the Total Return to be an underperformance
against the original expectations for the DP67 Share Class.
The gain on ordinary activities after taxation for the year was £168,000
(2023: loss of £221,000), comprising a revenue gain of £7,000 (2023: loss of
£92,000) and a capital gain of £161,000 (2023: loss of £129,000).
Investments
As at 31 March 2024, the DP67 Share Class held a portfolio of two investments
of value, with that value totalling £1.3 million.
Portfolio activity
Excluding the formal dissolutions of Yamuna Renewables Limited and London City
Shopping Centre Limited in the year, there were no additions or disposals.
Portfolio valuation
During the year, the valuation of the remaining DP67 Share Class increased in
value by a total of £137,000 (2023: £nil).
Following a distribution from the underlying business which sold its hotel
asset, in which Gatewales Limited holds an interest, it is estimated that the
DP67 Share Class will shortly receive £481,000, an increase of £137,000 from
previously recognised.
Attempts by Cadbury House Holdings Limited to sell its conference centre and
hotel property have been ongoing for some months now. During the year, no
offers have been received that match the target valuation and therefore, the
decision was made to continue to market the property until a buyer is found
with an offer at an appropriate price. The DP67 Share Class’s holding
remains held at the same value as reported at the end of last year and loan
interest continues to be recognised in full, providing the Share Class with
£194,000 of income during the year.
Outlook
The challenge now is to achieve an exit from Cadbury House Holdings Limited at
an acceptable valuation. The market for this type of assets is currently weak
but we believe it is in the best interests of Shareholders not to sell at
undervalue even if this means the final exit takes longer. Further dividends
will be paid once the final realisations have taken place.
Foresight Group LLP
31 July 2024
An investment summary is shown on page 34 of the Annual Report and Accounts.
Additions and disposals for the year ended 31 March 2024 are shown on pages 36
and 37 of the Annual Report and Accounts.
Audited Income Statement
for the year ended 31 March 2024
Year ended 31 March 2024 Year ended 31 March 2023
Revenue Capital Total Revenue Capital Total
£’000 £’000 £’000 £’000 £’000 £’000
Income 50 - 50 284 - 284
Realised (losses)/gains on investments - (5,959) (5,959) - 141 141
Investment holding losses - (2,758) (2,758) - (6,448) (6,448)
Investment management fees (481) (479) (960) (472) (472) (944)
Other expenses (528) - (528) (689) - (689)
Loss on ordinary activities before tax (959) (9,196) (10,155) (877) (6,779) (7,656)
Tax on total comprehensive income and ordinary activities - - - - - -
Loss attributable to equity Shareholders, being total comprehensive loss for the year (959) (9,196) (10,155) (877) (6,779) (7,656)
Basic and diluted (loss)/return per share:
Ventures Share (1.0p) (10.3p) (11.3p) (1.0p) (5.5p) (6.5p)
Healthcare Share (1.4p) (17.9p) (19.3p) (1.4p) (20.0p) (21.4p)
AIM Share (2.5p) 3.2p 0.7p (4.3p) 8.2p 3.9p
DSO D Share (0.1p) 3.0p 2.9p 0.3p (0.4p) (0.1p)
DP67 Share 0.1p 1.4p 1.5p (0.8p) (1.2p) (2.0p)
The total column within the Income Statement represents the Statement of Total
Comprehensive Income of the Company prepared in accordance with Financial
Reporting Standard 102 (“FRS 102”). The supplementary revenue return and
capital return columns are prepared in accordance with the Statement of
Recommended Practice issued in July 2022 by the Association of Investment
Companies (“AIC SORP”).
Audited Balance Sheet
as at 31 March 2024
2024 2023
£’000 £’000
Fixed assets
Investments 28,420 43,157
Current assets
Debtors 2,126 2,510
Cash at bank and in hand 10,456 6,082
12,582 8,592
Creditors: amounts falling due within one year (615) (1,214)
Net current assets 11,967 7,378
Net assets 40,387 50,535
Capital and reserves
Called up share capital 110 117
Capital redemption reserve 4 4
Share premium account 1,396 -
Special reserve 49,101 50,483
Capital reserve – realised (2,311) 4,127
Revaluation reserve (2,665) 93
Revenue reserve (5,248) (4,289)
Total equity Shareholders’ funds 40,387 50,535
Basic and diluted Net Asset Value per share:
Ventures Share 46.8p 59.4p
Healthcare Share 41.5p 61.6p
AIM Share 101.8p 101.1p
DSO D Share - 2.6p
DP67 Share 26.3p 24.8p
The financial statements on pages 76 to 100 of the Annual Report and Accounts
were approved and authorised for issue by the Board of Directors on 31 July
2024 and were signed on its behalf by:
Sir Aubrey Brocklebank Bt.
Chair
Company number: 06789187
Statement of Changes in Equity
for the year ended 31 March 2024
Called up Share capital Capital Redemption reserve Share premium account Funds held in respect of shares not yet allotted Special reserve Capital Reserve - realised Revaluation Reserve Revenue reserve Total
£’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000 £’000
At 31 March 2022 113 58 29,284 7 24,063 3,769 6,995 (3,412) 60,877
Total comprehensive income - - - - - (331) (6,448) (877) (7,656)
Transfer between reserves* - - - - (2,540) 2,994 (454) - -
Unallotted shares - - - (7) - - - - (7)
Transactions with owners
Dividend paid - - - - - (2,305) - - (2,305)
Cancellation of share premium - (58) (31,727) - 31,785 - - - -
Issue of shares 8 - 2,500 - - - - - 2,508
Share issue costs - - (57) - - - - - (57)
Purchase of own shares (4) 4 - - (2,825) - - - (2,825)
At 31 March 2023 117 4 - - 50,483 4,127 93 (4,289) 50,535
Total comprehensive income - - - - - (6,438) (2,758) (959) (10,155)
Transactions with owners
Dividend paid - - - - (1,172) - - - (1,172)
DSO D wind up (8) - - - (210) - - - (218)
Issue of shares 1 - 1,411 - - - - - 1,412
Share issue costs - - (15) - - - - - (15)
At 31 March 2024 110 4 1,396 - 49,101 (2,311) (2,665) (5,248) 40,387
*A transfer of £nil (2023: £454,000) representing previously recognised
realised gains and losses on disposal of investments during the period has
been made between the Revaluation Reserve and the Capital reserve - realised.
A transfer of £nil (2023: £2,540,000) representing the total of: realised
losses on the disposal of investments, cumulative realised losses on permanent
fair value change, capital expenses and capital dividends in the period, has
been made between the Capital Reserve - realised and the Special reserve.
Cash Flow Statement
for the year ended 31 March 2024
Year ended 31 March 2024 Year ended 31 March 2023
£’000 £’000
Cash flows from operating activities
Loss on ordinary activities before taxation (10,155) (7,656)
Losses on investments 8,717 6,307
(Decrease)/increase in creditors (87) 249
(Increase)/decrease in debtors (11) 1,807
Net cash (outflow)/inflow from operating activities (1,536) 707
Cash flow from investing activities
Purchase of investments (500) (8,442)
Proceeds from disposal of investments 6,347 8,119
Proceeds from deferred consideration 353 -
Net cash inflow/(outflow) from investing activities 6,200 (323)
Cash flows from financing activities
Issue of share capital 1,412 2,508
Funds held in respect of shares not yet allotted - (7)
Cost of issue of share capital (15) (57)
Repurchase of shares (515) (2,825)
Equity dividends paid (1,172) (2,305)
Net cash outflow from financing activities (290) (2,686)
Net inflow/(outflow) in cash 4,374 (2,302)
Cash and cash equivalents at start of the year 6,082 8,384
Cash and cash equivalents at end of the year 10,456 6,082
Cash and cash equivalents comprise
Cash at bank and in hand 10,456 6,082
Total cash and cash equivalents 10,456 6,082
Notes
1. These are not statutory accounts in accordance with S436 of the Companies
Act 2006. The full audited accounts for the year ended 31 March 2024, which
were unqualified and did not contain statements under S498(2) of the Companies
Act 2006 or S498(3) of the Companies Act 2006, will be lodged with the
Registrar of Companies. Statutory accounts for the year ended 31 March 2024
including an unqualified audit report and containing no statements under the
Companies Act 2006 will be delivered to the Registrar of Companies in due
course.
2. The audited Annual Financial Report has been prepared on the basis of
accounting policies set out in the statutory accounts of the Company for the
year ended 31 March 2024. All investments held by the Company are classified
as ‘fair value through the profit and loss’. Unquoted investments have
been valued in accordance with IPEV guidelines. Quoted investments are stated
at bid prices in accordance with the IPEV guidelines and Generally Accepted
Accounting Practice.
3. Copies of the Annual Report will be sent to shareholders and can be
accessed on the following website:
www.foresight.group/products/thames-ventures-vct-2-plc.
4. Basic and diluted Net Asset Value per share
Shares in issue 2024 Net Asset Value 2023 Net Asset Value
2024 2023 Pence per share £’000 Pence per share £’000
Ventures Shares 67,213,007* 66,852,564* 46.8p 24,914 59.4p 31,383
Healthcare Shares 29,266,979* 27,544,877* 41.5p 9,782 61.6p 13,449
AIM Shares 2,695,803 2,695,803 101.8p 2,746 101.1p 2,726
DSO D Shares - 7,867,247 - - 2.6p 200
DP67 Shares 11,192,136 11,192,136 26.3p 2,945 24.8p 2,777
Net assets per Balance Sheet 40,387 50,535
*Includes 13,976,149 (2023: 13,976,149) Ventures Management Shares and
5,712,064 (2023: 5,712,064) Healthcare Management Shares, which have not been
included in the calculation of Net Asset Value per share as the right to
distributions on the Management Shares is waived until certain performance
hurdles have been met, as described on pages 9 and 20 of the Annual Report and
Accounts.
The Directors allocate the assets and liabilities of the Company between the
DSO D Shares, DP67 Shares, Ventures Shares, Healthcare Shares and AIM Shares
such that each Share Class has sufficient net assets to represent its dividend
and return of capital rights, as described in note 12 of the Annual Report and
Accounts.
As the Company has not issued any convertible shares or share options, there
is no dilutive effect on the Net Asset Value per DSO D Share, per DP67 Share,
per Ventures Share, per Healthcare Share or per AIM Share. The Net Asset Value
per share disclosed therefore represents both the basic and diluted Net Asset
Value per DSO D Share, per DP67 Share, per Ventures Share, per Healthcare
Share and per AIM Share.
5. Basic and diluted return per share
Weighted Average number of shares in issue* Revenue (loss)/ gain Capital (loss)/ gain Total Comprehensive (loss)/ income Basic and diluted (loss)/ return per share
£’000 £’000 £’000 Pence
Return per share is calculated on the following:
Year ended 31 March 2024
Ventures Shares 53,230,238 (566) (5,474) (6,040) (11.3p)
Healthcare Shares 23,517,050 (328) (4,205) (4,533) (19.3p)
AIM Shares 2,695,803 (66) 86 20 0.7p
DSO D Shares 7,781,266 (6) 236 230 2.9p
DP67 Shares 11,192,136 7 161 168 1.5p
Year ended 31 March 2023
Ventures Shares 48,923,338 (494) (2,679) (3,173) (6.5p)
Healthcare Shares 20,046,893 (272) (4,018) (4,290) (21.4p)
AIM Shares 916,744 (39) 75 36 3.9p
DSO D Shares 7,867,247 20 (28) (8) (0.1p)
DP67 Shares 11,192,136 (92) (129) (221) (2.0p)
*Excluding 13,976,149 (2023: 13,976,149) Ventures Management Shares and
5,712,064 (2023: 5,712,064) Healthcare Management Shares as there is an
agreement in place with the Company that the right to distributions on the
Management Shares is waived until certain the performance hurdles are met, as
described on pages 9 and 20 of the Annual Report and Accounts. At no point
will voting rights attaching to the Management Shares be exercised.
As the Company has not issued any convertible securities or share options,
there is no dilutive effect on the return per DSO D Share, DP67 Share,
Ventures Share, Healthcare Share or AIM Share. The return per share disclosed
therefore represents both the basic and diluted return per share for all
classes of share.
6. Annual General Meeting
The Annual General Meeting of the Company will be held at the offices of
Foresight Group LLP, The Shard, 32 London Bridge Street, SE1 9SG at 4.00 p.m.
on 24 September 2024. Details will be published on both the Company’s and
the Adviser’s website at:
www.foresight.group/products/thames-ventures-vct-2-plc.
7. Income
2024 2023
£’000 £’000
Income from investments
Loan interest 46 269
Dividend income 2 15
48 284
Other income
Other income 2 -
50 284
8. Investments
Ventures Share Class Healthcare Share Class AIM Share Class DSO D Share Class* DP67 Share Class Total
£’000 £’000 £’000 £’000 £’000 £’000
Opening cost at 1 April 2023 33,892 13,757 1,800 274 2,252 51,975
Investment holding (losses)/gains at 1 April 2023 (6,134) (1,402) 93 (258) (1,117) (8,818)
Opening fair value at 1 April 2023 27,758 12,355 1,893 16 1,135 43,157
Movements in the year:
Purchased at cost 500 250 - - - 750
Disposal proceeds (5,186) (1,122) - (39) - (6,347)
Realised losses on disposals** (3,562) (2,228) - (235) (499) (6,524)
Investment holding (losses)/gains*** (1,711) (1,909) 110 258 636 (2,616)
Closing value at 31 March 2024 17,799 7,346 2,003 - 1,272 28,420
Closing cost at 31 March 2024 25,644 10,657 1,800 - 1,753 39,854
Investment holding (losses)/gains at 31 March 2024 (7,845) (3,311) 203 - (481) (11,434)
Closing value at 31 March 2024 17,799 7,346 2,003 - 1,272 28,420
*Following the payment of the 2.7p per DSO D Share dividend on 28 March 2024,
the Company has now returned all the capital associated with the DSO D Shares
to Shareholders and divested of all investments held in the portfolio, with
the payment of the dividend marking the end of the life cycle of the DSO D
Shares. Realised losses in the Income Statement include the reversal of
historic realised losses (£212,000) as part of the wind-up procedures.
**Realised losses in the Income Statement for the Ventures Share Class include
the deferred consideration receipt from ADC Biotechnology Limited (£115,000).
Realised losses in the Income Statement for the Healthcare Share Class include
the deferred consideration receipts from ADC Biotechnology Limited
(£195,000). Realised losses in the Income Statement for the DP67 Share Class
include the deferred consideration receipt from Fenkle Street LLP (£43,000).
***Investment holding losses in the Income Statement for the Ventures Share
Class include the deferred consideration debtor decrease of £38,000. The
debtor movement reflects the recognition of an amount receivable in respect of
Imagen Limited (£18,000), offset by a receipt in respect of ADC Biotechnology
Limited (£115,000) and combined FX uplifts of £59,000 made against balances
in respect of Efundamentals Group Limited and JRNI Limited. Investment holding
losses in the Income Statement for the Healthcare Share Class include the
deferred consideration debtor decrease of £104,000. The debtor movement
reflects the recognition of an amount receivable in respect of DIA Imaging
Analysis Limited (£91,000), offset by a receipt in respect of ADC
Biotechnology Limited (£195,000).
9. Related party transactions
No Director has an interest in any contract to which the Company is a party
other than their appointment and remuneration as Directors.
10. Transactions with the Investment Manager
In the opinion of the Directors, there is no immediate or ultimate controlling
party.
Fees payable during the year to the Directors and their interest in shares of
the Company are disclosed within the Directors’ Remuneration Report on pages
56 and 57 of the Annual Report and Accounts. There were no amounts outstanding
and due to the Directors as at 31 March 2024 (2023: nil).
Further related party transactions include Investment Management and
Administration fees payable to Foresight Group LLP and Downing LLP, as
disclosed in notes 3 and 4 of the Annual Report and Accounts.
In addition, Downing LLP was also paid promoter fees in connection with the
offers for subscription which were open during the year. The total paid to
Downing LLP during the year ended 31 March 2024 was £nil (2023: £39,000).
The Company also has an agreement to pay an ongoing trail fee annually to the
Investment Manager, in connection with applicable proceeds raised under
previous offers for subscription, out of which there is an obligation to pay
trail commission to intermediaries. The total trail fee payable in respect of
the year ended 31 March 2024 was £24,000, all of which was unpaid as at 31
March 2024 (2023: £21,000).
A copy of the Annual Report and Accounts will be submitted to the National
Storage Mechanism in accordance with UK Listing Rules (“UKLR”)11.4.1 /
UKLR 6.4.1 and UKLR 6.4.3.
END
For further information, please contact:
Company Secretary
Foresight Group LLP
Contact: Stephen Thayer Tel: 0203 667 8100
Investor Relations
Foresight Group LLP
Contact: Andrew James Tel: 0203 667 8181