Annual Financial Report

Annual Financial Report

New Cent. Aim Vct 2

New Century AIM VCT2 plc Â
Audited Report and Accounts for the year to 31st December 2013

Details of Directors	Â
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		11
Directors' Report		12
Directors’ Remuneration Report		15
Corporate Governance		17
Independent Auditors' Report		20
Income Statement		23
Balance Sheet		24
Cash Flow Statement		25
Notes to the Accounts		26
Shareholder Information		35
Notice of Annual General Meeting		36
Form of Proxy
Financial Summary

Â	Â	Year ended 31 December 2013	Â	Year ended 31 December 2012
Revenue return per share (pence) for the year		(0.56)		0.07
Total return per share (pence) for the year		11.39		5.25
Proposed dividends per share (pence)		1.25		1.00
Net asset value per share (pence)		55.21		44.37
Cumulative value of shareholder investment (net asset value plus cumulative dividends per share) (pence)		57.97		46.13
Shareholders’ funds (£’000)		3,140		2,804

The 2012 comparative information has not been amended in respect of subsequent share issues.

Chairman’s Statement

I am delighted to say it has been a good year for your fund. The net asset value has risen from 44.37p to 55.21p per share. Adding in the 1p net dividend we paid, the total return over the year has been 26.7% compared to a rise of 20.3% in the FTSE AIM Index.

It is disappointing that the share price has continued to languish despite this encouraging performance. We have no control over the share price but we plan to carry out a further buyback this year. This will allow shareholders to sell some of their holding at closer to the current net asset value should they wish to do so. We have agreed to increase the dividend to 1.25p per share. Hopefully measures like these will help to reduce the share price discount to net asset value. A further measure that we have implemented is to publish the net asset value on a monthly basis with The London Stock Exchange. This will help shareholders monitor the progress of the fund which has not been apparent by following the share price.

The level of qualifying investments at 76% is still comfortably above the 70% required level.

The current year has started very well with the net asset value as at 31 March, 2014, rising to 60.03p

Geoffrey Gamble 29 April 2014

Details of Directors

Michael Barnard (Aged 62)

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, M D Barnard. Based in Laindon, Essex, it has offices in London, Wells, Exeter and Colchester. Since 1995, he has been either managing or advising unit trust, private client and pension company portfolios with a total value of approximately £115 million.

Geoffrey Gamble (Aged 53)

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 Ltd 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 67)

Peter qualified as a solicitor in 1969 and in that year became partner of Mitchells, Solicitors. In 1977, he became a partner in his present solicitor practice, Daybells, where he specialises in property law with an emphasis on large commercial properties.

Ian Cameron-Mowat (Aged 63)

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.

Management and Administration

Registered Office	Â	7th Floor, 52-54 Gracechurch Street London EC3V 0EH
Company Secretary		Graham Kenneth Urquhart FCIS 7th Floor, 52-54 Gracechurch Street London EC3V 0EH
Registrar		Neville Registrars Limited Neville House 18 Laurel Lane Halesowen West Midlands B63 3DA
Solicitors		Dundas & Wilson 5th Floor, Northwest Wing Bush House Aldwych London WC2B 4EZ
Investment Manager and Broker		M D Barnard & Company Limited 17-21 New Century Road Laindon, Essex SS15 6AG
Auditor & VCT Status Adviser		UHY Hacker Young LLP Quadrant House 4 Thomas More Square London E1W 1YW
Bankers		Bank of Scotland New Uberior House 11 Earl Grey Street Edinburgh EH3 9BN

Directors

Geoffrey Gamble (Chairman)

Michael David Barnard

Peter William Riley

Ian Cameron-Mowat

All directors are non-executive.

Audit Committee:

Geoffrey Gamble (Chairman)

Peter William Riley

Ian Cameron-Mowat

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 unquoted and AIM traded companies in the United Kingdom. The company has been listed on the London Stock Exchange since 4 April 2007 and has been granted approval by the Inland 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 have managed the affairs of the company with the intention that it will qualify for approval by the Inland Revenue as a Venture Capital Trust for the purposes of Section 842AA of the Income and Corporation Taxes Act 1988 (‘the Act’). 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

There was a positive change in sentiment towards AIM companies in the second half of 2013. As well as an improving economic outlook, new rules that allow the purchase of AIM shares within ISAs triggered interest in smaller companies.

More companies have taken advantage of this positive sentiment to seek a listing on AIM or for existing companies to raise funds to seek acquisitions or to fund working capital.

We made twenty two VCT Qualifying investments purchasing shares in Probability, Modern Water, Microsaic, Quixant, Versarien, Blur Group, Keywords, Cloudbuy, PHSC, EU Supply, Plastic Capital, Daily Internet, Litebulb Group, Eclectic Bars, Kalibrate Technologies, Syqic, Flow Group, Outsourcery, MartinCo, Solid State, Eden Research and Sanderson Group.

The number of investments is increasing as, to help spread the risk, we continue to commit smaller amounts into each company. These new investments also cover a wide variety of sectors, ranging from water desalinization to technology companies, media and brand enhancement to pubs and bars etc.

As well as these qualifying investments, we also purchased shares in twenty four non qualifying investments that we thought were undervalued.

During the year the fund processed a 10% buy back of the share capital at a 5% discount to its net asset value at that time. This helped provide some liquidity to shareholders that were looking to sell some of their shares.

The economy within the UK continues to recover and with the added attraction of AIM share purchases not having to pay stamp duty from 28 April 2014, we are hopeful that this will appeal to investors looking to invest in smaller companies within AIM. We remain hopeful of another good showing in the current year.

Investment Objective

New Century AIM VCT2 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 unlisted companies and 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 note 20 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 it 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.

Michael Barnard 29 April 2014

Investment Portfolio

Security	Â	Cost	Â	Valuation	Â	%	Â	%
Â		Â		31/12/2013		Cost		Valuation
									Â
Qualifying Investments		2,941,173		2,489,267		76.00		78.84
Non-qualifying Investments		799,831		539,303		20.67		17.08
Uninvested funds		128,788		128,788		3.33		4.08
		3,869,792		3,157,358		100.00		100.00
									Â
Qualifying Investments
AIM Quoted
Marechale Capital plc		151,504		34,500		3.92		1.09
Sinclair Pharma plc		183,285		196,000		4.74		6.21
HML Holdings plc		271,350		350,000		7.01		11.09
Sport Media Group plc		125,625		0		3.25		0.00
Environ Group plc		334,125		0		8.63		0.00
Kurawood plc		150,750		0		3.90		0.00
Corac Group plc		160,062		74,794		4.14		2.37
Tristel plc		204,303		222,750		5.28		7.05
Advanced Computer Software		64,069		390,000		1.66		12.35
Cyan Holdings plc		204,218		32,840		5.28		1.04
M.Winkworth plc		56,280		116,900		1.45		3.70
Green Compliance plc		33,668		670		0.87		0.02
Angel Biotech Holdings		57,781		0		1.49		0.00
Music Festivals plc		45,730		0		1.18		0.00
Inspired Energy plc		59,273		157,250		1.53		4.98
Microsaic systems		36,690		37,625		0.95		1.19
Eco City Vehicles		34,675		36,800		0.90		1.17
Venn Life Sciences		125,628		100,000		3.25		3.17
DP Poland		25,631		28,050		0.66		0.89
Probability		61,814		33,633		1.60		1.07
Modern Water		50,256		42,000		1.3		1.33
Quixant		9,247		24,400		0.24		0.77
Blur		6,785		25,200		0.18		0.80
Keywords Studios		25,162		22,589		0.65		0.72
Sanderson		15,204		18,425		0.39		0.58
Cloudbuy		33,168		49,000		0.86		1.55
PHSC		50,256		60,000		1.30		1.90
EU Supply		22,262		22,540		0.58		0.71
Plastics Capital		33,168		40,920		0.86		1.30
Daily Internet		30,153		30,000		0.78		0.95
Litebulb		51,008		79,750		1.32		2.53
Eclectic Bar		35,379		36,080		0.91		1.14
Kalibrate Technologies		27,975		39,811		0.72		1.26
Syqic		26,546		28,966		0.69		0.92
Flow Group		24,500		24,000		0.63		0.76
Outsourcery		28,143		28,250		0.73		0.89
Martinco		50,253		63,500		1.30		2.01
Solid State		35,247		42,024		0.91		1.33
		Â		Â		Â		Â
Total qualifying investments		2,941,173		2,489,267		76.00		78.84
Security		Cost		Valuation		%		%
Â		Â		31/12/2013		Cost		Valuation
Non-qualifying Investments
AIM Quoted
DCD Media		60,300		521		1.56		0.02
Eco City Vehicles		15,671		4,880		0.40		0.15
Sanderson Group		18,717		30,150		0.48		0.95
Rotala plc		47,884		64,800		1.24		2.06
Tristel plc		60		45		0.00		0.00
Advanced Computer Software		168		312		0.00		0.01
Green Compliance plc		2		0		0.00		0.00
China Food		31,547		9,900		0.82		0.31
2Ergo Group		17,932		500		0.46		0.02
Learning Technologies		88,162		55,020		2.28		1.74
Motivcom		14,376		29,237		0.37		0.93
Hightex		18,922		0		0.49		0.00
Nature Group		21,309		9,600		0.55		0.30
Gable Holdings		6,238		18,000		0.16		0.57
Litebulb Group		21,897		49,500		0.57		1.57
Sorbic International		10,205		10,150		0.26		0.32
TLA Worldwide		26,975		30,000		0.70		0.95
Driver Group		8,992		12,200		0.23		0.39
Mobile Tornado		10,124		13,000		0.26		0.41
API Group		8,070		8,325		0.21		0.26
Eco Animal		11,460		11,400		0.30		0.36
Mar City		10,053		11,875		0.26		0.38
		Â		Â		Â		Â
		449,064		369,415		11.60		11.70

Security	Â	Cost	Â	Valuation	Â	%	Â	%
Â		Â		31/12/2013		Cost		Valuation
									Â
UK listed
Investec		169,415		82,538		4.38		2.61
British American Tobacco		22,104		32,380		0.57		1.03
Imperial Tobacco		23,759		23,380		0.61		0.74
Greene King		9,964		11,000		0.26		0.35
Waterman		9,926		10,150		0.26		0.32
Servelec		5,040		6,440		0.13		0.20
		240,208		165,888		6.21		5.25
									Â
									Â
Unlisted Investments
Merchant House 15%		45,228		0		1.17		0.00
Merchant House 6.5%		45,228		0		1.17		0.00
Merchant House 14%		20,103		4,000		0.52		0.13
		110,559		4,000		2.86		0.13
									Â
									Â
Total non-qualifying investments		799,831		539,303		20.67		17.08

Top Ten Investments

							Â
Security	Â	Cost	Â	Valuation	Â	%
							Â
Advanced Computer Software		64,069		390,000		12.35
							Â
HML Holdings plc		271,350		350,000		11.09
							Â
Tristel plc		204,303		222,750		7.05
							Â
Sinclair Pharma plc		183,285		196,000		6.21
							Â
Inspired Energy plc		59,273		157,250		4.98
							Â
M. Winkworth plc		56,280		116,900		3.70
							Â
Venn Life Sciences		125,628		100,000		3.17
							Â
Investec		169,416		82,538		2.61
							Â
Litebulb Group		51,008		79,750		2.53
							Â
Corac Group plc		160,062		74,794		2.37

The investments tabulated above are expressed as a percentage by valuation of the company’s investment portfolio including uninvested cash.

Directors’ Report

The directors present their report and the audited accounts for the year to 31 December 2013.

Results and dividend

	Â	Year to 31 December 2013			Â	Year to 31 December 2012
		Revenue	Â	Capital		Revenue	Â	Capital
		£’000		£’000		£’000		£’000
Return on ordinary activities after taxation		(34)		718		5		325
		Â		Â		Â		Â
Appropriated as follows:
									Â
Interim dividend paid
									Â
Revenue – nil p		-		-		-		-
									Â
Capital – nil p		-		-		-		-
									Â
Final dividend paid in respect of prior year
Revenue – 0.00p (0.00p) per share		-		-		-		-
Capital – 1.00p (0.00p) p per share		-		(57)		-		-
									Â
		Â		Â		Â		Â
Transfers to reserves		(34)		661		5		325

Directors

The directors of the company who served throughout the year and their interests in the issued ordinary shares of 10p of the company are as follows:

	Â	Year ended 31 December 2013	Â	Year ended 31 December 2012
					Â
Michael David Barnard Geoffrey Gamble Peter William Riley Ian Cameron-Mowat		578,783 138,106 3,000 88,153		606,854 175,000 3,000 100,000

All of the directors’ share interests shown above are held beneficially. There have been no changes in the directors’ share interests between 31 December 2013 and the date of this report.

Brief biographical notes on the directors are given on page 3. The director, retiring in accordance with the Company’s Articles of Association, Geoffrey Gamble, who being eligible will offer himself for re-election at the forthcoming annual general meeting. The directors believe his experience in small companies is a great benefit to the Board and recommend his re-election.

None of the directors have 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. Limited has acted as investment manager to the company since inception. The principal terms of the Investment Management Agreement are set out in Note 3 to the Accounts.

VCT status monitoring

The company has engaged UHY Hacker Young LLP to advise it on compliance with the VCT legislation. UHY Hacker Young LLP reviews the company’s investment portfolio to monitor ongoing VCT compliance. UHY Hacker Young LLP works closely with the investment manager, but reports directly to the Board of the company.

Substantial shareholdings

The company has been notified, in accordance with Chapter 5 of FCA’s Disclosure and Transparency Rules, of the under noted interests as at 31 December 2013 of 3 per cent shareholders and above:

MD Barnard	Â	578,783
JR Atkinson		205,000
DM Trotman		200,000
J Beddoe		200,000
IA Houston		200,000
RS Like		180,000
P Steyne		177,537

Acquisition of own shares

During the year the company re-purchased 631,955 ordinary shares in accordance with the special resolution passed at the Annual General Meeting on 26 June 2013 allowing the Directors to acquire up to 14.99% of the ordinary shares of the company.

Structure of the company’s capital

The company only has one class of ordinary share and each share has attached to them full voting rights, dividends and capital distribution rights (including on a winding up) and do not confer any rights of redemption.

Appointment of Directors

The Directors are subject to re-election with one third of the Directors being re-elected annually at the AGM.

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.

Post balance sheet events

Details of the post balance sheet events are set out in note 24.

Annual general meeting

Notice of the annual general meeting is set out on page 36.

Auditors

In accordance with Section 485 of the Companies Act 2006, a resolution proposing that UHY Hacker Young LLP be reappointed as auditors of the Company and that the Directors be authorised to determine their remuneration will be put to the next Annual General Meeting.

Statement of disclosure to auditors

So far as the directors are aware:

1. there is no relevant audit information of which the Company’s auditors are 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 auditors are aware of that information.

By Order of the Board

Michael Barnard 29 April 2014

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 put to the members at the Annual General Meeting to be held on 25 June 2014.

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 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.

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 31 December 2012 and 31 December 2013 is 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 29 April 2014

Corporate Governance

The directors support the relevant principles of the UK Corporate Governance Code issued in September 2012 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 is available as the following location:

www.frc.org.uk/corporate/ukcgcode.cfm

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 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 Board

The company is led and controlled by a Board of directors who are all non-executives and who have had relevant experience with quoted companies prior to their appointment. The Chairman is Geoffrey Gamble. Biographical details of all Board members are shown on page 3.

One third of the Directors are subject to re-election at each AGM by rotation.

During the year the following were held:

3 full board meetings	Â	2 Audit Committee meetings
All directors attended all meetings.		All members attended all meetings

All directors had relevant experience with quoted companies prior to their appointment and it was therefore not thought necessary to provide further training in respect of their obligations and duties.

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 it presents a balanced and understandable assessment of the company’s position and prospects. The Audit Committee meets at least once a year. Under the chairmanship of a non-executive director, its membership comprises all the non-executive directors with the exception of the representative of the investment manager. During the year the Audit Committee was chaired by Mr Gamble. The Audit Committee reviews the accounts 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 investment manager is authorised and regulated by the Financial Conduct Authority and the directors have an opportunity to review their own auditors’ review of their financial controls.

Relations with shareholders

The Chairman is the company’s principal spokesman with investors, fund managers, the press and other interested parties.

Shareholders will have the opportunity to meet the Board at the AGM. The Board is also happy to respond to any written queries made by shareholders during the course of the year, or to meet with major shareholders if so requested.

In addition to the formal business of the AGM, representatives of the management team and the Board are available to answer any shareholder queries.

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. The notice of the next AGM and proxy form can be found at the end of these accounts.

Financial Reporting

The directors’ statement of responsibilities for preparing the financial statements is set out on page 19, and a statement by the auditors about their reporting responsibilities is set out in the Auditors’ Report on page 20.

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 Turnbull guidance.

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 M D Barnard & Co. Limited.

Compliance statement

The Listing Rules require the Board to report on compliance with the fifty-four Governance Code provisions throughout the accounting year. The Comply or Explain directions of the Governance 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 31 December 2013 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 independent directors, as defined by the Governance Code issued in September 2012. The board consider that Messrs. Gamble, Riley and Cameron-Mowat 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 chaired by John Geoffrey Gamble, Chairman of the Board of directors, whom the board regard as independent despite recommendations to the contrary in the Governance Code due to his being Chairman of the Board of directors.

8. The non-executive directors do not have service contracts, whereas the recommendation is for fixed term renewable contracts.

9. 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 annual general meeting.

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 period. 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; 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.

Independent Auditors’ Report to the members of New Century AIM VCT2 plc

We have audited the financial statements of New Century AIM VCT 2 plc for the year ended 31 December 2013 which comprise the Income Statement, the Balance Sheet, the Cash Flow Statement and the related notes. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards (United Kingdom Generally Accepted Accounting Practice).

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.

Respective responsibilities of directors and auditors

As explained more fully in the Statement of Directors’ Responsibilities set out on page 19, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view. Our responsibility is to audit the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the Auditing Practices Board's (APB's) Ethical Standards for Auditors.

Scope of the audit of the accounts

A description of the scope of an audit of financial statements is provided on the FRC's web-site at www.frc.org.uk/apb/scope/private.cfm.

Opinion on accounts

In our opinion the financial statements:

• give a true and fair view of the state of the company's affairs as at 31 December 2013 and of the company's profit 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 and Article 4 of the IAS Regulation.

Our assessment of risks of material misstatements

We identified the following risks that we believe have had the greatest impact on our audit strategy and scope:

• The carrying value of the investments and the recognition of realised and unrealised gains and losses. The investment portfolio and associated realised and unrealised gains and losses is the key driver to the financial performance of the company and has the greatest impact on both the income statement and balance sheet.
• Compliance with the VCT rules is necessary to maintain the VCT status and associated tax benefits.

Our 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 influence the economic decisions taken on the basis of the financial statements by reasonable users. We also determine a level of performance materiality which we use to determine the extent of testing needed to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality for the financial statements as a whole.

Our application of materiality (continued)

We determined materiality for the financial statements as a whole to be £48,000. In determining this we based our assessment on an average of three key indicators, being the result before tax, the net assets and gross assets of the company. 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, being £36,000.

An overview of the scope of our audit

The approach we took in the assessed risks described above was as follows:

• We tested the value of the year-end investments by reference to market price information at the year end. The purchase and sale of investments were agreed to contract notes and cash movements on a sample basis. The realised gains and losses on the sale of investments were re-calculated for both the individual transactions on a sample basis and for the total portfolio.

The movement in unrealised gains was checked for arithmetical accuracy and validated by reviewing the opening costs to prior year balances and purchases on a sample basis.

The portfolio is maintained by the investment advisor 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.

• Our work in respect of the compliance with the VCT rules involved testing the eight conditions for maintaining approval as a VCT as set out by HMRC. Each of the conditions was tested in turn in order to assess whether it had been met as at the year end.

Opinion 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;
• the information given in the Strategic Report and the Directors' Report for the financial year for which the accounts 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.

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.

Matters on which we are required to report by exception (continued)

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 17, 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

Â

Quadrant House

4 Thomas More Square

London, E1W 1YW

Â

29 April 2014

Income Statement (incorporating the revenue account)

for the year to 31 December 2013

	Â		Â	Year ended 31 December 2013					Â	Year ended 31 December 2012
		Notes		Revenue £’000	Â	Capital £’000	Â	Total £’000		Revenue £’000	Â	Capital £’000	Â	Total £’000
															Â
Gains/(losses) on investments
- realised				-		240		240		-		128		128
- unrealised				-		500		500		-		218		218
Income		2		30		-		30		46		-		46
Investment management fee		3		(8)		(22)		(30)		(7)		(21)		(28)
Other expenses		4		(56)		-		(56)		(34)		-		(34)
				-------------		------------		------------		_______		________		________
Return on ordinary activities before taxation				(34)		718		684		5		325		330
Tax charge on ordinary activities		6		-		-		-		-		-		-
				------------		------------		------------		________		________		________
Return on ordinary activities after taxation		Â		(34)		718		684		5		325		330
				=======		=======		=======		=======		=======		=======
															Â
Return per ordinary share (pence)		8		(0.56)		11.95		11.39		0.07		5.17		5.25
				=======		=======		=======		=======		=======		=======

The notes on pages 26 to 34 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 that shown above, the company had no recognised gains or losses. Accordingly no statement of total recognised gains and losses has been prepared.

Balance Sheet

at 31 December 2013

Â	Â	    Note	Â	As at 31 December 2013 £’000			Â	As at 31 December 2012 £’000
				Â	Â			Â	Â
Fixed assets
Investments		9				3,028				2,457
											Â
Current assets
Debtors		12				129				355
											Â
Current liabilities
Creditors: amounts falling due within one year		13				(17)				(8)
											Â
						Â				Â
						3,140				2,804
						Â				Â
Capital and reserves
Called up share capital		14				569				632
Share premium		15				57				5,307
Capital Redemption Reserve		15				63				-
Capital reserve – realised		15				(1,032)				(1,946)
Capital reserve – unrealised		15				2,075				(1,167)
Revenue reserve		15				1,408				(22)
											Â
						Â				Â
Total equity shareholders’ funds		16				3,140				2,804
Net asset value per ordinary share		17				55p				44p

The financial statements on pages 23 to 34 were approved by the Board of directors on 29 April 2014 and were signed on its behalf by:

Michael Barnard

Director

The notes on pages 26 to 34 form an integral part of these financial statements.

Company’s registered number: 6054576

Cash Flow Statement

for the year to 31 December 2013

	Â	Note	Â	Year ended 31 December 2013 £’000							Â	Year ended 31 December 2012 £’000
							Â								Â
Net cash outflow from operating activities		19						(77)								(62)
																			Â
Returns on investments
Interest received				2								10
Investment income				28								36
								30								46
																	Â
UK Corporation Tax paid								-										-
																			Â
Dividend paid								(57)										-
																			Â
Capital expenditure & financial investment
Sale of investments				1,179								829
Purchase of investments				(1,010)								(689)
Net cash inflow for capital expenditure & financial investment								169										140
																			Â
Share Capital (re-purchase)/issue net of expenses								(291)										73
																			Â
								Â										Â
Net cash (outflow)/ inflow								(226)										197
																			Â
		Â			Â	Â			Â	Â			Â
(Decrease)/increase in uninvested funds with broker								(226)										197

The notes on pages 26 to 34 form an integral part of these financial statements.

Notes to the Financial Statements for the year to 31 December 2013

1. Accounting policies

General

The financial statements have been prepared in accordance with applicable United Kingdom law and accounting standards and the Statement of Recommended Practice “Accounts of Investment Trust Companies”. The financial statements have been prepared under the historical cost convention, as modified to include the revaluation of fixed asset investments.

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.

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.

Notes to the Financial Statements for the year to 31 December 2013

1. Accounting policies (continued)

Taxation

Deferred taxation is provided in full on timing differences that result in an obligation at the balance sheet date to pay more tax, or a right to pay less tax, at a future date, at rates expected to apply when they crystallise based on current tax rates and law. Timing differences arise from the inclusion of items of income and expenditure in taxation computations in periods different from those in which they are included in the accounts. Deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be recovered. Deferred tax assets and liabilities are not discounted.

2. Income

	Â	Year ended 31 December 2013 £’000			Â	Year ended 31 December 2012 £’000
Interest receivable		Â	Â			Â	Â
- listed fixed interest securities				-				-
- unquoted investment portfolio				1				10
- bank deposits and liquid funds				1				-
				Â				Â
				2				10
Other income
Dividends receivable				28				36
				Â				Â
				30				46

3. Investment management fees

	Â	Year ended 31 December 2013			Â	Year ended 31 December 2012
		Revenue £’000	Â	Capital £’000		Revenue £’000	Â	Capital £’000
									Â
Investment management fees		8		22		7		21

MD Barnard & Company 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 12 March 2007. Michael Barnard who is a non-executive director of the company is the owner and managing director 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 31 March, 30 June, 30 September and 31 December. During the year ended 31 December 2013, the fee payable to MD Barnard & Company equated to 1% per annum of net assets. No performance fee is payable.

The investment management agreement is for a minimum period of three years from 12 March 2007 terminable by either party at any time thereafter by one year’s prior written notice.

4. Other expenses

Â

Â

Year ended 31 December 2013 £’000

Â

Year ended 31 December 2012 £’000

Administrative and secretarial services

Â

Â

Â

Â

32

10

Auditors' remuneration

10

10

-for tax services

3

3

Regulatory fees

11

11

Â

Â

Â

Â

Â

Â

56

34

5. Directors’ remuneration

No remuneration has been paid or is payable for year to 31 December 2013 or in respect of the prior year.

6. Tax charge on ordinary activities

	Â	Year ended 31 December 2013			Â	Year ended 31 December 2012
		Revenue £’000	Â	Capital £’000		Revenue £’000	Â	Capital £’000
									Â
United Kingdom tax based on the taxable profit for the year
- Current year		-		-		-		-
- Prior year		-		-		-		-
		Â		Â		Â		Â
		-		-		-		-
		Â		Â		Â		Â
Factors affecting tax charge for the year
									Â
Return on ordinary activities before taxation		(34)		718		5		325
		Â		Â		Â		Â
Tax on above at the small company rate of 20% (2012: 20%)		(7)		144		1		65
UK dividends not subject to corporation tax		(6)		-		(7)		-
Non-deductible losses on investment				(162)		-		(83)
Non allowable expenses		3		-		-		-
Unutilised/(utilised) losses		10		18		6		18
									Â
		Â		Â		Â		Â
Current tax charge for the year		-		-		-		-

7. Dividends

	Â	Year ended 31 December 2013 £’000			Â	Year ended 31 December 2012 £’000
Capital dividend paid		Â	Â	57		Â	Â	-
Final dividend paid in respect of previous year				-				-
				Â				Â
				57				-

On 29 April 2014 the directors proposed a dividend in respect of the year ended 31 December 2013 of £79,094.94 representing 1.25p per ordinary share.

8. Return per ordinary share

The revenue return, per ordinary share, is based on the net revenue on ordinary activities after taxation of £(33,806) (2012: £4,650) and on 6,009,778 (2012: 6,282,554) ordinary shares, being the weighted average number of ordinary shares in issue during the year.

The total return per ordinary share is based on a net profit (loss) after taxation of £684,406 (2012: £329,615) and on 6,009,778 (2012: 6,282,554) ordinary shares, being the weighted average number of ordinary shares in issue during the year.

9. Fixed asset investments

	Â	As at 31 December 2013 £’000			Â	As at 31 December 2012 £’000
		Â	Â			Â	Â
UK listed				166				296
AIM				2,858				2,089
PLUS Markets				-				-
Unlisted				4				72
				Â				Â
				3,028				2,457

Movements in investments, including realised and unrealised gains and losses, during the year are summarised as follows:

Â		Â		Â		Â	Year ended 31 December 2013
					Gilts		UK Listed	Â	AIM	Â	Plus Mkts	Â	Un-listed	Â	Total
					£’000		£’000		£’000		£’000		£’000		£’000
at 1 January 2013					-		296		2,089		-		72		2,457
Purchases					-		41		949		-		20		1,010
Transfers					-		(49)		40		-		9		-
					-		288		3,078		-		101		3,467
less: Sales					-		192		967		-		20		1,179
					-		96		2,111		-		81		2,288
Realised gains/(losses)					-		42		206		-		(8)		240
Unrealised gains/(losses)					-		28		541		-		(69)		500
					-		166		2858		-		4		3,028
Cost at 31 December 2013					-		240		3,390		-		111		3,741

9. Fixed asset investments (continued)

Â		Â		Â		Â	Year ended 31 December 2012
					Gilts		UK Listed	Â	AIM	Â	Plus Mkts	Â	Un-listed	Â	Total
					£’000		£’000		£’000		£’000		£’000		£’000
at 1 January 2012					-		429		1,663		17		142		2,251
Purchases					-		93		576		-		20		689
Transfers					-		(6)		6		-		-		-
					-		516		2,245		17		162		2,940
less: Sales					-		244		545		22		18		829
					-		272		1,700		(5)		144		2,111
Realised gains/(losses)					-		(8)		160		5		(29)		128
Unrealised gains/(losses)					-		32		229		-		(43)		218
					-		296		2,089		-		72		2,457
Cost at 31 December 2012					-		357		3,092		-		110		3,559

The overall gain/ (loss) on investments for the years shown in the Income Statement is as follows:

	Â	Year ended 31 December 2013 £’000			Â	Year ended 31 December 2012 £’000
Net realised gain on disposal		Â	Â	240		Â	Â	128
Increase in unrealised appreciation				500				218
				Â				Â
				740				346

10. Venture capital investments

A full list of investments held is disclosed under Investment Portfolio.

11. Significant interests

The Company did not hold more than 10% of the allotted equity share capital of any class of any investee company.

12. Debtors

	Â	As at 31 December 2013 £’000			Â	As at 31 December 2012 £’000
Uninvested funds with broker:		Â	Â			Â	Â
MD Barnard & Co Ltd				129				355

13. Creditors

	Â	As at 31 December 2013 £’000			Â	As at 31 December 2012 £’000
Trade creditors and accruals		Â	Â	17		Â	Â	8
UK Corporation Tax				-				-
MD Barnard & Co Ltd				-				-
				Â				Â
				17				8

14. Share capital

	Â	As at 31 December 2013 £’000			Â	As at 31 December 2012 £’000
Authorised		Â	Â			Â	Â
25,000,000 ordinary shares of 10p each				2,500				2,500
				Â				Â
Allotted, called up and fully paid
5,687,595 (2012:6,319,550) ordinary shares of 10p each				569				632

During the year the company re-purchased 631,955 ordinary shares in accordance with the special resolution passed at the Annual General Meeting on 26 June 2013. The shares were repurchased at an average price of 0.461 pence per share.

15. Reserves

	Â	Share Premium account £’000	Â	Capital Redemption Reserve £’000	Â	Capital realised £’000	Â	Capital unrealised £’000	Â	Revenue reserve £’000
As at 1 January 2013		5,307		-		(1,946)		(1,167)		(22)
Share premium cancellation		(5,250)		-		585		2,853		1,812
Share buy-back		-		63		-		-		(291)
Realised gains on disposals		-		-		240		-		-
Unrealised gains		-		-		-		500		-
Transfer of unrealised loss to realised on disposal of investment		-		- -		111		(111)		-
Net revenue before tax		-		-		-		-		(34)
Investment management fee		-		-		(22)		-		-
Corporate taxation		-		-		-		-		-
Dividends paid		-		-		-		-		(57)
		________		_________		________		________		________
At 31 December 2013		57		63		(1,032)		2,075		1,408

On 25 January 2013 the Company, having received approval from the Court cancelled £5,250,000 of the Share Premium accounts, recognising a distributable reserve of £5,250,000.

16. Reconciliation of movements in shareholders’ funds

	Â	Â	Â	£’000
At 1 January 2013				2,804
Share buy-back				(291)
Dividend paid				(57)
Return on ordinary activities after tax				684
				Â
At 31 December 2013				3,140

17. Net asset value per share

Net asset value per share is based on net assets at 31 December 2013 of £3,140,229 (31 December 2012 of £2,804,284) and on 5,687,595 ordinary shares (2012: 6,319,550 ordinary shares) in issue at those dates.

18. Performance incentive arrangements

The Investment Manager is not entitled to any performance incentive arrangements.

19. Net cash outflow from operating activities

		Â	Year ended 31 December 2013 £’000			Â	Year ended 31 December 2012 £’000
Operating activity
Operating profit			684				330
Profit on sale of investments			(240)				(128)
Investment income			(30)				(46)
Unrealised gains investments			(500)				(218)
Increase in creditors			9				-
			________				________
			(77)				(62)

20. 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.

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.

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 company has not made any loans to investee companies.

Currency risk

The company’s assets and liabilities are denominated in sterling.

20. Risk management and financial instruments (continued)

Financial assets

The interest rate profile of the company’s financial assets is set out below:

	Â	Year ended 31 December 2013 £’000			Â	Year ended 31 December 2012 £’000
		Â	Â			Â	Â
Fixed rate				-				72
Non-interest bearing				3,028				2,385
				Â				Â
				3,028				2,457

Fixed rate assets	Â	Year ended 31 December 2013 £’000			Â	Year ended 31 December 2012 £’000
		Â	Â			Â	Â
Weighted average interest rate				n/a				13.4%
Weighted average years to maturity				n/a				2.2

Non-interest bearing financial assets comprise 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 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.

21. Related party transactions

New Century AIM VCT2 plc is managed by M D Barnard & Co. Limited.

22. Capital commitments

There were no investments which were approved at the year-end but which had not completed.

23. Control

New Century AIM VCT2 plc is not under the control of any one party or individual.

24. Post balance sheet events

There have been no post balance sheet events that require disclosure.

Shareholder Information for the year to 31 December 2013

The Company

New Century AIM VCT2 PLC2 was incorporated on 16 January 2007. On 4 April 2007, the company obtained a listing on the London Stock Exchange. A total of £5.745 million was raised (before expenses) through an offer for subscription of new ordinary shares at 100p. The company has been provisionally approved as a Venture Capital Trust by the Inland Revenue.

The Investment Manager

New Century AIM VCT2 PLC is managed by M D Barnard & Company Limited, an independent fund management company based in Laindon, Essex. M D Barnard & Company currently manages or advises private client funds and venture capital funds totalling approximately £25 million including New Century AIM VCT2 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. From 6 April 2005, investors subscribing for new shares in a VCT have been entitled to claim income tax relief of 30% on their investment, irrespective of their marginal tax rate (up to a maximum investment 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.

New Century AIM VCT2 has been provisionally approved as a VCT by the Inland Revenue. 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. 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	Â	25 June 2014
Interim report for six months to 30 June 2014		August 2014
Preliminary announcement of results for the year to 31 December		2014 April 2015
Annual General Meeting 2015		June 2015

The shares will go ex-dividend on 19 June 2014, the proposed dividend will be paid to shareholders on the share registrar as at 21 June 2014. The dividend will be paid on 19 July 2014.

Share price

The mid-market price of shares in New Century AIM VCT PLC2 is available daily on the London Stock Exchange website (www.londonstockexchange.com).