Half-yearly Report
HgCapital Trust plc
Private equity investment trust of the year
Investment Week Awards 2005, 2006, 2007 and 2008
Half-yearly report and accounts
30 June 2009
Investment objective
The objective of the Company is to provide shareholders with long-term capital
appreciation in excess of the FTSE All-Share Index by investing in unquoted
companies.
The Company provides investors with exposure to a diversified portfolio of
private equity investments primarily in the UK and Continental Europe.
Financial highlights
of the first six months of 2009
-2.9% A decline in NAV resulting from further provisions against a small number
of investments, FX movements and payment of the dividend
+21.2% Share price and dividend (total return) versus an increase in the FTSE
All-Share Index of 0.8% and in the FTSE Small-Cap of 22.7%
46% A high level of net assets available in liquid funds (£100.7 million),
representing over £4.00 per share, to deploy in attractive opportunities
+15.6% Ten year total performance p.a. versus 0.1% p.a. from the FTSE All-Share
Index
>4x Ten year investment return for every £1 invested
£15m Net cash invested, as low level of activity both in terms of investments
and realisations reflects current market conditions
Chairman's statement
Our aim continues to be delivery of long-term growth in value in an efficient
and liquid investment vehicle
Performance
Following the long series of successful realisations between 2005 and 2008 the
Company entered this severe downturn of the economic cycle with substantial
holdings of cash and a compact portfolio of investments. The top ten buy-out
investments now account for 80% of the total portfolio by value (excluding
cash). As usual, the Board has valued the Company's investments at 30 June in
accordance with the International Private Equity and Venture Capital Valuation
Guidelines (`IPEV'). Five of the top ten investments have been revalued
upwards, due to changes in the ratings used for valuations or improved trading,
in several cases following hard work by the Manager alongside company
management to redirect strategy or improve performance. After careful review,
two recent investments have been held at cost. Several other investments have
been written down (in some cases to zero value), due to weak trading or lower
multiples. Overall, in local currency terms, the value of the portfolio was
broadly unchanged, but the appreciation of sterling against the euro
contributed to a small fall in net asset value. An analysis of individual
movements and an attribution analysis are set out below.
As a consequence, in the first six months of 2009 the Company's NAV fell by
5.5% or 51.3 pence per share (of which 25.0 pence relates to the dividend paid
in May 2009) from 929.4 pence at 31 December to 878.1 pence at 30 June 2009.
Total return to shareholders (NAV plus dividend) over the period was -2.9%
compared with +0.8% for the FTSE All-Share Index and +22.7% for the FTSE
Small-Cap Index. The Company's share price has traded within the range 640.0 -
817.0 pence, ending the period at 786.0 pence; this represents a discount of
10.5% to NAV, a far lower discount than comparable investment trusts,
reflecting the Company's strong investment record and the defensive value of
the Company's high liquidity.
In anticipation of better investment opportunities becoming available in the
near future, the Manager made only one investment. As a result, the Company
ended the period with liquid funds of more than £100 million, representing 46%
of net assets.
Revenue return per share was 7.8 pence, compared with 29.1 pence in the same
period last year, which had reflected, in part, a one-off receipt of income. As
explained in earlier reports to shareholders, the Company's revenue will vary
from year to year in accordance with the structure of the underlying
investments and income from the Company's holding of liquid funds awaiting
reinvestment. The reduced size of the portfolio and the low yields available on
liquid funds inevitably result in much reduced revenues and this is likely to
bring the Company's dividend back to levels paid in earlier years.
Realisations
With the current low valuation environment and no pressure to achieve
disposals, only small realisations were made in order to tidy up the portfolio.
Investments
The Manager continued to approach new investment selectively, completing one
purchase in the period: we share the view that, given the state of economic and
market conditions, good businesses will progressively become available for
purchase and at better value than in the past. The Company's substantial
liquidity positions it well to take advantage of such opportunities.
Principal risks and uncertainties
This section of my statement sets out the Directors' views, as required by the
Disclosure and Transparency Rules, concerning the principal risks and
uncertainties facing the Company in the second half of the year.
While remaining nervous, equity markets are showing early expectations of
economic recovery. The Manager has reserved a significant portion of the
HgCapital 5 fund for further investments to support the portfolio and exploit
market opportunities.
The severe problems suffered by a few private equity investment trusts have
affected sentiment towards the sector as a whole and discounts to NAV remain
wide. However, the shares of HgCapital Trust have not fallen as far against NAV
as others have and they currently stand at a low discount compared with our
peer group. We believe this reflects the Manager's track record of success in
identifying and realising investments, its focus on improving operational
performance, our policy of transparency in reporting and the Company's prudent
management of liquidity through the economic cycle. As confidence in other
trusts is rebuilt, sector discounts may return to more normal levels.
The raising of debt in large amounts remains difficult; however, there are
signs of some easing in its availability for the mid-market acquisitions in
which HgCapital specialises. A number of other private equity managers, whose
investors are seeking to reduce their commitments or who are struggling to
raise funds for investment, have - at least for now - withdrawn from the
market, and the excesses in pricing, often debt fuelled, have abated.
Nevertheless, we think it is prudent to remain cautious in making new
investments while economic visibility remains poor; although this is improving.
In addition, the availability of non-distressed and quality assets is expected
to increase next year. Both features are likely to affect the speed at which
the Company's liquid funds will be deployed.
Outlook
In current economic and market conditions the Company has two priorities. The
first is to preserve value through active support of portfolio companies,
guiding managers through difficult trading conditions and making underlying
businesses efficient and well positioned for an upturn. As a specialist in
mid-market buy-outs our Manager, HgCapital, has always sought to add value
through active management of portfolio companies and maintains a specialist
team to focus on operational improvement undistracted by new deals.
The second priority is to build a pipeline of high quality investment
opportunities so that the Company can take full advantage of its liquidity at a
time when we expect good businesses to become available for purchase at
reasonable prices. In order to build and manage the pipeline, earlier this year
HgCapital reorganised its specialist sector teams so as to have more resources
ready to mobilise whenever an opportunity develops.
The Board of HgCapital Trust has consistently said that an allocation to
private equity was sensible for investors able to take a long term view. We
hold to this opinion despite the ending of the long bull market, though recent
experience has shown up the importance of selecting investments with a
resilient business model, prudent use of leverage, continuous focus on
performance, and careful interpretation of the economic cycle. The very real
difficulties suffered by some other private equity investment trusts do not
undermine the case for an allocation to private equity; rather, they point up
the risks of over-commitment, excessive leverage at an inflection point in the
economic cycle, and the limited flexibility inherent in very large
acquisitions.
We are entering a period that we believe will prove in due course to have been
a good time for investment in private equity. To take full advantage of this,
earlier this year the Board committed to invest £250 million, and in certain
circumstances up to a further £50 million, alongside the Manager's new fund.
This commitment was based on our best estimate at the time of the level of
investment necessary to maintain the Company's progress. The commitment is made
with the flexibility to invest less, if cash is unavailable at the time, or
more, through co-investments, if conditions for investment are attractive and
the Company has access to additional funds. In making these judgments the Board
and Manager will continue to pursue the very clear Investment Objective which
we have set, with the aim of delivering to shareholders consistent long-term
growth in value in excess of public equity markets, in a form which provides an
efficient and liquid investment vehicle.
Roger Mountford
Chairman
27 August 2009
Interim management report and responsibility statement
Interim management report
The important events that have occurred during the period under review are set
out in the Chairman's statement and in the Manager's review, which also include
the key factors influencing the financial statements.
The principal risks and uncertainties for the remaining six months of the
financial year are set out in the Chairman's statement.
The Directors do not consider that the principal risks and uncertainties have
changed since the publication of the annual report for the year ended 31
December 2008. The principal risks are performance risk, income/dividend risk,
regulatory risk, operational risk, financial risk, and liquidity risk as set
out on page 50 of the annual report which is available at http://
www.hgcapitaltrust.com.
Performance risk
The Board is responsible for deciding the investment strategy to fulfil the
Company's objectives and for monitoring the performance of the Manager. An
inappropriate strategy may lead to poor performance.
Income/dividend risk
The amount of dividends and future dividend levels will depend on the income
received and receivable from the Company's underlying portfolio.
Regulatory risk
The Company operates as an investment trust in accordance with section 842 of
`ICTA'. As such, the Company is exempt from corporation tax on any capital
gains realised from the sale of its investments.
Operational risk
In common with most other investment trust companies, the Company has no
employees. The Company therefore relies upon the services provided by third
parties and is dependent upon the control systems of the Manager and the
Company's other service providers.
Financial risk
The Company's investment activities expose it to a variety of financial risks
that include valuation risk, liquidity risk, market price risk, foreign
exchange risk and interest rate risk.
Liquidity risk
The Company, by the very nature of is investment objective, invests in unquoted
companies, and liquidity in their securities can be constrained, potentially
making the investments difficult to realise at, or near, the Director's
published valuation at any one point in time.
HgCapital, as Manager of the Company, is considered to be a related party by
virtue of its management contract with the Company. During the period, payments
to HgCapital for services, excluding carried interest, were £3,096,000 (30 June
2008: £1,946,000; 31 December 2008: £4,000,000). At 30 June 2009, the amount
due to HgCapital, disclosed under creditors, was £462,000 (30 June 2008: £
988,000; 31 December 2008: £1,046,000). Where applicable, amounts are inclusive
of VAT.
Responsibility statement
The Directors confirm that to the best of their knowledge:
• The condensed set of financial statements has been prepared in accordance
with the Statement on Half-yearly Financial Reports issued by the UK Accounting
Standards Board;
• The Interim management report includes a full review of the information
required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of
important events that have occurred during the first six months of the
financial year and their impact on the condensed set of financial statements;
and a description of the principal risks and uncertainties for the remaining
six months of the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party
transactions that have taken place in the first six months of the current
financial year and that have materially affected the financial position or
performance of the entity during that period; and any changes in the related
party transactions described in the last annual report that could do so.
The Directors are responsible for the maintenance and integrity of the
corporate and financial information included on the Company's website.
Legislation in the United Kingdom governing the preparation and dissemination
of financial information differs from legislation in other jurisdictions.
This half-yearly report was approved by the Board of Directors on 27 August
2009 and the above Responsibility statement was signed on its behalf by Roger
Mountford, Chairman.
Performance record
Financial highlights
Assets at: 30.6.09 30.12.08 %
(unaudited) (audited) change
Net assets (£'000) 221,163 234,094 (5.5)
Net assets per share 878.1p 929.4p (5.5)
Share price (mid-market) 786.0p 668.5p 17.6
Revenue six months ended: 30.6.09 30.6.08 %
(unaudited) (unaudited) change
Net revenue (£'000) 1,953 7,333 (73.4)
Earnings per share 7.8p 29.1p (73.4)
Historical total return* performance
Six One year Three Five Ten years
months to years years
June 2009 % p.a. % p.a.
% p.a. % p.a.
% pa
Net asset value (2.9) (12.6) 10.6 18.7 13.5
Share price 21.2 (5.4) 9.9 19.6 15.6
FTSE All-Share Index 0.8 (20.5) (6.5) 3.1 0.1
FTSE Small-Cap Index 22.7 (19.1) (10.5) (0.4) 0.9
Based on the Company's share price at 30 June 2009 and allowing for dividends
to be reinvested, an investment of £1,000 ten years ago would now be worth £
4,247. An equivalent investment in the FTSE All-Share Index would be worth £
1,014.
*Total return assumes all dividends have been reinvested. Source: Factset
Manager's review
All investments referred to in this report, excluding the investment in Hg
Renewable Power Partners LP, are held by HGT LP and HGT6 LP. The Company is the
sole limited partner in HGT LP and HGT6 LP.
Analysis of movements in net asset value for the six months ended 30 June 2009
Opening net asset value as at 1 January 2009 234,094
Gross revenue 3,659
Priority profit share to General Partner (2,962)
Other expenditure (312)
VAT recovery on prior years' management fees 553
Taxation (874)
Dividends paid (6,297)
Realised proceeds in excess of 31 December 2008 book value (excluding 485
gross revenue)
Net unrealised depreciation of investments (excluding accrued (7,183)
interest)
Closing net asset value as at 30 June 2009 221,163
Overview
The Company invests in unquoted companies identified by the Manager, HgCapital,
alongside other clients with the objective of providing shareholders with
long-term capital appreciation in excess of the FTSE All-Share Index.
HgCapital aims to act as controlling investor in middle-market buyouts of
between £50 million and £500 million enterprise value ("EV"), located in
Europe. Typically, the Company's holding forms part of a much larger HgCapital
stake in these businesses. In general, throughout this report financial
information refers to each transaction in its entirety, apart from the tables
which detail the Company's participation, and where this review specifically
states otherwise.
The Company's net asset value fell from £234.1 million to £221.2 million during
the period under review. This fall mainly arose from unfavourable movements in
the valuation of the unrealised portfolio, a large proportion of which relates
to foreign exchange rates, and the 2008 final dividend payment of £6.3 million.
The fall in net asset value of 2.9% (total return basis) compares to a
significant increase in the FTSE Small-Cap (+22.7%) in the six months to 30
June 2009. This short term underperformance is to be expected given both the
high weighting of liquid assets within the portfolio (45%) and the application
of the IPEV guidelines where we have taken a cautious approach to valuing
unrealised investments in the current economic climate.
The Company realised proceeds during the period amounting to £1.9 million.
These proceeds arose principally from deferred consideration received from
Hirschmann and the sale of Newchurch.
During the period, the Company invested a total of £16.9 million including
participation in one new buyout investment. This new investment was made in
Epyx.
Portfolio
Trading conditions have been challenging during the period and, whilst there
have been some strong performers such as Visma and Pulse, a number of the
Company's investments performed below expectations. SHL, KVT, Fabory and Mondo
have all been impacted by a fall in end-user demand. In light of this pressure
on revenues, cost reduction programmes have been implemented across all the
businesses in order to support profitability. HgCapital actively works with all
portfolio companies and encouraged early and strong action in anticipation of
demand falls. Systems designed, inter alia, to indicate future trading outlook
are monitored centrally. Overall HgCapital has been very pleased with the speed
of action and positive attitude of portfolio company managers.
The impact of market ratings on portfolio valuations has been mixed with
favourable movements in comparables causing write ups in certain investments
such as Visma and Pulse, and unfavourable movements negatively impacting other
investments such as Voyage, Elite, SHL and Casa Reha. The leveraged nature of
many investments means that small changes in enterprise value have a geared
impact on equity valuations.
Realised and unrealised movements in investment portfolio valuation (including
accrued interest) for the six months ending 30 June 2009
Net unrealised Realised proceeds in
appreciation/ excess of 31 December 2008
(depreciation) of book value £'m (excludes
investments £'m gross revenue)
Pulse (1)* 9.5 -
Visma (2) 2.8 -
Euro Hedge 1.5 -
Sporting Index (4) 1.1 -
Voyage (7) 0.5 -
Americana (9) 0.5 -
SLV 0.3 -
Hirschmann - 0.3
Newchurch - 0.2
Other - 0.2
SHL (1.0) -
Cornish (1.1) -
Weston Presidio III (1.3) -
Schleich (5) (1.4) -
KVT (1.4) -
Atlas (2.0) -
Casa Reha (10) (2.6) -
Elite (2.8) -
Mondo (8) (2.9) -
Fabory (3.1) -
*Investment name and ranking within top 10 investment portfolio
Outlook
We see significant opportunities for private equity arising from the current
and prospective economic environment. Lower availability of debt finance, which
historically fuelled asset pricing, coupled with more cautious or distracted
competition, should present better value opportunities and, as visibility
starts to improve, risk adjusted prices should fall and returns on equity
increase.
Business disposals beyond fire sales and poor quality assets are likely to
increase in volume during the coming year. An increasing number of businesses
needing to restructure or drive operational change will further add to
opportunities for equity providers, and strategic M&A and ownership change will
not remain on hold as the economy levels out. Historically, private equity
investments made following an economic downturn have been particularly
successful and we believe the coming period will not be dissimilar.
HgCapital's portfolio is now compact and under control despite the challenging
economic conditions. A cautious approach to new investment will continue,
although as visibility and stability improve HgCapital would expect to begin to
deploy more capital. Given the current economic and M&A conditions we do not
expect to see a significant number of exits in the near term, but will continue
to evaluate all options for the portfolio and exit opportunities.
Portfolio analysis
A diverse portfolio, invested along sector lines, across the UK and Continental
Europe
At 30 June 2009 the Company's portfolio consisted of 37 investments, of which
the 10 principal investments represented 80% of the portfolio valuation. The
Company offers both sector and geographic diversification in a portfolio of
privately owned mid cap stocks. The valuation of the Company's unrealised
portfolio (including interest) as at 30 June 2009 was £121.5 million,
representing 55% of net assets.
One substantial new investment was made during the period: the management
buyout of Epyx, a provider of an electronic market place for automotive fleet
services.
During the period there were no full realisations of investments, but deferred
proceeds from Hirschmann as well as other small realisations returned £1.9
million.
The Company ended the period with £101 million of liquid assets. Having access
to substantial liquidity positions the Company well to take advantage of
changing market conditions and to exploit new investment opportunities as these
arise.
Asset classâ€
Unquoted 55%
Liquid assets 45%
Valuation basis†â€
Earnings 54%
Written down 26%
Cost 13%
Fund net assets 6%
Other 1%
Sector by value†â€
TMT 32%
Healthcare 28%
Consumer & Leisure 20%
Industrials 9%
Renewable energy 6%
Services 4%
Fund 1%
Deal type by value†â€
Buyout 92%
Renewable energy 6%
Expansion 1%
Fund 1%
Geographic spread by value†â€
UK 56%
Nordic Region 21%
Germany 14%
Rest of Europe 6%
Benelux 2%
North America 1%
Vintage by value†â€
2009 9%
2008 9%
2007 17%
2006 36%
2005 8%
Pre 2005 21%*
†Percentages are based on net assets
††Percentages are based on investments at value including accrued interest
*18% relates to Pulse Staffing
Investments
Selective investments in businesses which should perform across market cycles
During the first half of 2009, HgCapital invested £115 million on behalf of its
clients, including £16.9 million for the Company.
Company Sector Activity Deal Type Cost
£'000
Epyx TMT A private car fleet Buyout 10,826
services marketplace
New investments 10,826
Hg RPP LP Renewable Renewable energy fund Fund 3,007
energy
SHL Services Psychometric testing and Buyout 1,503
assessment
VISMA TMT Business application Buyout 1,341
software
Other 212
Further investments 6,063
Total investment by 16,889
the Company
Figures below refer to the total size of each acquisition, including debt
raised from third parties, made by HgCapital on behalf of its clients,
including the Company.
NEW INVESTMENTS
Epyx
In June 2009, HgCapital completed the buyout of Epyx Limited through the
holding company Quadrum Investments, in partnership with management.
HgCapital's clients have a 49% stake in this business, but HgCapital has
effective control rights over and above its economic holding. Epyx provides a
private electronic marketplace serving the contract car hire and leasing
market. The Epyx electronic trading environment enables both customers and
suppliers to reduce costs and increase efficiency across multiple business
processes such as servicing and disposals. Epyx operates over 50 buyer schemes
and hosts 11,000+ registered suppliers.
FURTHER INVESTMENTS
SHL
In May 2009 HgCapital invested a further £12.0 million in SHL, in order to fund
restructuring and ensure liquidity during a period of challenging trading. This
is mainly a repayment of the £9.0 million early repayment of loan stock
received in July 2007.
Visma
In February 2009 HgCapital invested a further £8.3 million in Visma in order to
fund the acquisition of the Finnish accounting services business Teemuaho.
Visma also continues to make incremental value-enhancing acquisitions, funded
out of cash flow.
Hg Renewable Power Partners
In the first quarter of 2009 HgCapital invested €35.2 million in Mercurio
Solar, a portfolio of four operational solar photovoltaic projects in Spain
with a total capacity of 35MW. A further €7.5 million was invested in Wind
Direct Solutia, a 5MW two turbine wind project in Newport, South Wales. In the
second quarter HgCapital invested €12 million to acquire the 5MW Bargas Solar
PV project to grow our platform in Spain.
Realisations
During the first half of 2009, HgCapital realised total proceeds of £19 million
on behalf of its clients, including £1.9 million for the Company.
Company Sector Exit route Cost Proceeds* Cumulative Current
gain/ year
£'000 £'000 (loss)** gain***
£'000 £'000
Hirschmann Industrials Release of - 1,165 1,165 346
escrow
Other 956 774 (182) 597
Partial 956 1,939 983 943
realisations
Total 956 1,939 983 943
realisations
* Includes gross revenue received during the period.
** Realised proceeds including gross revenue received, in excess of historic
cost
*** Realised proceeds including gross revenue received, in excess of 31
December 2008 book value and accrued interest
Figures below refer to the total value of each realisation, including, where
appropriate, repayment of third party debt. Proceeds to clients, including the
Company, are stated net of any such repayment.
PARTIAL REALISATIONS
Hirschmann
Hirschmann is a supplier of electronics equipment, components and related
accessories. The initial investment in the business by HgCapital was made in
March 2004 and the business was successfully exited in March 2007 returning
over 5.0x the original investment. A remaining release of escrow in Hirschmann
was realised in May 2009 returning a further £7.4 million to HgCapital clients,
of which the Company's share was £1.2 million.
Further small realisations were received relating to Newchurch which was sold
to Tribal plc, in exchange for cash proceeds of £0.2 million and shares in
Tribal plc, currently valued at £0.1 million.
REALISATION PROSPECTS
HgCapital works continually with all the companies in its portfolio to position
them for best value on exit. In considering the timing of any exit, HgCapital
evaluates market conditions, current and potential growth in the portfolio
company and likely purchaser interest in any sale process. Given the current
uncertain market conditions, HgCapital is not planning to make any significant
realisations in the next six months. Despite this, we will continue to monitor
the market and our portfolio and ensure we maximise value for investors.
Review of principal investments
1 Pulse
www.pulsejobs.com
Sector: Healthcare
Location: UK
Date invested: June 1999
Original enterprise value: £67 million
Total HgCapital clients' equity: 74%
Business description
* Pulse is one of the UK's leading providers of comprehensive labour
management, recruitment and deployment services in the healthcare sector.
* The company works in partnership with healthcare organisations in the
public and private sectors to provide staffing, management services and
consultancy.
Performance
*
+ Current trading: both revenues and EBITDA are significantly up year on
year. The business has no external borrowings.
* Exit strategy: Pulse is anticipated to be a target for both private equity
and trade buyers.
2 Visma
www.visma.com
Sector: TMT
Location: Norway
Date invested: May 2006
Original enterprise value: NOK 4.3 billion
Total HgCapital clients' equity: 53%
Business description
* VISMA is the number one provider of business software and related services
to small and medium-sized enterprises in the Nordic region.
* The company provides accounting, resource planning and payroll software,
outsourced book-keeping, payroll services and transaction process
outsourcing.
Performance
* Current trading: performance in the year to date has been strong, with good
growth in both sales and EBITDA.
* Exit strategy: significant interest from secondary buyers is expected. An
IPO or trade sale to software/publishing companies provide alternative exit
options.
3 Epyx
www.epyx.co.uk
Sector: TMT
Location: UK
Date invested: June 2009
Original enterprise value: Undisclosed
Total HgCapital clients' equity: 49%
Business description
* Epyx provides a private electronic marketplace serving the vehicle contract
hiring and leasing market. The Epyx service enables both customers and
suppliers to reduce costs and increase efficiency across multiple business
processes.
* Epyx operates over 50 buyer schemes and hosts 11,000+ supplier
registrations.
Performance
* Current trading: materially ahead of prior year, as planned.
* Exit strategy: most likely exit via trade sale with potential secondary
private equity interest.
4 Sporting Index
www.sportingindex.com
Sector: Consumer & Leisure
Location: UK
Date invested: November 2005
Original enterprise value: £73 million
Total HgCapital clients' equity: 70%
Business description
* Sporting Index is a sports spread betting firm well positioned in the UK
market.
* It aims to offer more markets, more `fun bets', and more choice than any
other sports spread betting company.
Performance
* Current trading: sales and profit slightly down on prior year.
* Exit strategy: the company will be positioned for a trade exit, most likely
to an industry consolidator.
5 Schleich
www.schleich-s.com
Sector: Consumer & Leisure
Location: Germany
Date invested: December 2006
Original enterprise value: €165 million
Total HgCapital clients' equity: 76%
Business description
* Schleich is the leading producer of classic plastic toy figurines, such as
farm and wildlife animals, historical characters and The Smurfs.
* Its products, trading under the well recognised brand Schleich-S, are sold
in over 30 countries, including its home market of Germany, the US, the UK
and France.
Performance
* Current trading: continued good growth in both revenues and EBITDA during
the year to date as the company continues to expand internationally.
* Exit strategy: several multi-national toy makers represent natural trade
buyers; stable profits and risk profile could also support an IPO.
6 Voyage
www.voyagecare.com
Sector: Healthcare
Location: UK
Date invested: April 2006
Original enterprise value: £322 million
Total HgCapital clients' equity: 52%
Business description
* Voyage is an operator of small community-based homes for adults with
learning disabilities and associated physical disabilities, autistic
spectrum disorders, complex needs and acquired brain injury.
* Currently, the company has 1,900 beds in 260 homes across England and
Scotland.
Performance
* Current trading: performance in the first half of 2009 was strong with both
sales and EBITDA ahead of prior year.
* Exit strategy: projected exit to either a secondary or a trade buyer,
although an IPO is also possible.
7 Mondo Minerals
www.mondominerals.com
Sector: Industrials
Location: Nordic region
Date invested: October 2007
Original enterprise value: €230 million
Total HgCapital clients' equity: 91%
Business description
* Mondo is the world number two in talc mining and processing. The company's
core markets are the European paper and paint industries.
* Mondo supplies the majority of talc for paper producers in the highly
regional market of Finland, the rest of the Nordic region and Northern
Europe.
Performance
* Current trading: current trading conditions are challenging due to a fall
in end-user demand. Cost reduction plans have been implemented to mitigate
this impact.
* Exit strategy: Mondo is anticipated to be an attractive target for both
private equity and trade buyers.
8 Americana
www.bench.co.uk
Sector: Consumer & Leisure
Location: UK
Date invested: March 2007
Original enterprise value: £180 million
Total HgCapital clients' equity: 45%
Business description
* Americana is a branded apparel business, manufacturing and marketing the
Bench brand, which is targeted at the youth market.
* The company predominantly operates through UK wholesale channels, with
increasing wholesale revenues in continental Europe, and is building a UK
retail presence.
Performance
* Current trading: both sales and profit for the year to June 2009 were ahead
of prior year as the company expands internationally.
* Exit strategy: options include a trade sale or secondary buyout.
9 Casa Reha
www.casa-reha.de
Sector: Healthcare
Location: Germany
Date invested: January 2008
Original enterprise value: €327 million
Total HgCapital clients' equity: 51%
Business description
* Casa Reha is a leading German private provider of elderly care services,
specialising in high quality, affordable assisted living.
* Founded in 1995, Casa Reha has a nationwide portfolio of 52 homes providing
around 7,000 beds.
Performance
* Current trading: performance for the first half of 2009 was mixed, with
sales marginally ahead and profit marginally behind prior year.
* Exit strategy: the business should be a strong IPO candidate or attractive
to larger private equity buyers.
10 Achilles
www.achilles.com
Sector: TMT
Location: UK
Date invested: July 2008
Original enterprise value: £75 million
Total HgCapital clients' equity: 79%
Business description
* Achilles is a global leader in buyer-sponsored supplier data management and
validation services.
* The company has 22 offices worldwide and has more than 32,000 customers,
with focus on industries with "high cost of supplier failure" (e.g. oil &
gas and construction).
Performance
* Current trading: performance in the first half of 2009 was strong with
significant growth on prior year in both sales and EBITDA.
* Exit strategy: an IPO, secondary or trade sale to a software company,
business process outsourcer or b2b exchange all provide possible exit
routes.
Company Residual Unrealised Accrued Total Valuation
cost value interest value methodology
£'000 £'000 £'000 £'000
Pulse 6,131 22,223 93 22,316 Earnings
Visma 14,609 16,531 2,050 18,581 Earnings
Epyx 10,826 10,826 - 10,826 Cost
Sporting Index 7,092 4,405 3,202 7,607 Earnings
Schleich 4,634 5,999 1,338 7,337 Earnings
Voyage 8,755 4,179 2,767 6,946 Written
down
Mondo Minerals 7,004 5,599 1,253 6,852 Written
down
Americana 4,625 4,483 1,708 6,191 Earnings
Casa Reha 8,151 4,626 648 5,274 Written
down
Achilles 5,226 5,226 - 5,226 Cost
RENEWABLE ENERGY
Hg Renewable Power Partners LP
Renewable energy benefits from a highly favourable regulatory and policy
environment with climate change solidly on the political agenda. The investment
in the fund will give the Company exposure to a diversified portfolio of assets
offering both income and capital appreciation in a rapidly growing sector. The
investment class has lower case by case target returns than private equity but
similarly attractive risk adjusted returns and a higher proportion coming in
the form of income.
In June 2006, the Company made a commitment of €21 million to Hg Renewable
Power Partners LP, a dedicated renewable energy fund managed by HgCapital. The
€303 million fund is one of the largest raised to date for renewable energy
investments in Europe and is focused on long-term investments in renewable
power projects using proven technologies, including wind, solar, small hydro,
landfill gas and waste-to-energy in Western Europe.
The fund has investments in eight wind projects in construction or operation
totalling 197MW; four biogas projects that are in operation totalling 1.4MW,
and five operational solar projects totalling 41MW. It has made a few smaller
investments in companies that develop wind projects, giving it the right to
acquire a further 281MW of new wind projects. The fund's investments have been
in France, Germany, Ireland, Italy, Sweden, Spain and the United Kingdom.
The Renewable Power Partners' portfolio is performing well with all
construction projects to date completed on time and on budget, operating assets
performing within the expected range and one realisation completed ahead of
original plan. To date, the fund is 65% committed, of which 49% has been drawn.
As described above, the portfolio is performing well with portfolio yield on an
upward trend.
The Fund's portfolio now includes the following investments:
Tir Mostyn
A 21.25MW operating wind farm in North Wales. The original investment was made
in November 2004, with construction completed in October 2005. The wind farm
has now been operating for over three years.
Sorne Wind
A 32 MW operating wind farm in Donegal, Ireland. This investment was made in
July 2005, with the farm entering operation in November 2006. On 5 March 2009
the Fund's interests in Sorne were sold for a gross price of €10 million, with
net proceeds (after transaction costs) of €9.88 million. This represents a
gross multiple of 2.3x the Fund's investment and an IRR of 43%.
Picardy Wind
A portfolio of two wind farms in Northern France in operation with a total
capacity of 23.5MW. The initial investment was made in July 2006. The fund has
the right to acquire the two further projects that are under construction with
a total capacity of 24MW.
Wind Direct
A business that installs, owns and operates wind turbines on UK industrial
sites, providing its customers with low cost, direct energy supplies. The
investment was made in 2006 and includes one site in operation with a capacity
of 4MW, one 5MW project in construction and the option to acquire two further
permitted projects.
Havsnäs
A 95.4 MW project is under construction, located in central Sweden. The
investment, which is the first project-financing of renewable generation in the
Nordic market, was completed in March 2008. The project will be the largest
on-shore wind farm in Sweden. Construction began in April 2008 and commercial
operation will begin in April 2010.
RidgeWind
A UK wind farm developer with 293MW of wind farms in development, including two
projects totalling 54 MW that have secured planning permission and the 16MW
Bagmoor project in Lincolnshire, entered full operation one month early, on 31
July 2009.
Rewind
An investment of €2.1 million was made in August 2006 to develop a 120MW
portfolio of wind farms in Italy. In October 2007 this agreement was terminated
on terms that give the fund the right to success fees or acquisition rights if
the projects achieve planning permission.
Bayern Energie
Four operating anaerobic digestion (biogas) plants with a combined capacity of
1.4MW in Germany. Our involvement in the development of further biogas projects
has been terminated with no further costs.
Mercurio
A total investment of €47 million has been made into the Mercurio portfolio
that consists of five operating Spanish solar photovoltaic plants totalling
41MW. The initial acquisition of four projects completed in March 2009 and the
portfolio was added to with the acquisition of the 5MW Bargas plant in April
2009.
The Company's top 20 investments by valueâ€
Company Sector Residual Valuation* Year of Portfolio Cum
cost investment value % Value %
£'000 £'000
1 Pulse Staffing Healthcare 6,131 22,316 1999 18.4% 18.4%
Ltd
2 VISMA Holdings TMT 14,609 18,581 2006 15.3% 33.7%
3 Epyx Investments TMT 10,826 10,826 2009 8.9% 42.6%
Limited
4 Sporting Index Consumer & 7,092 7,607 2005 6.3% 48.9%
Group Ltd Leisure
5 Schleich Consumer & 4,634 7,337 2006 6.0% 54.9%
Luxembourg SA Leisure
6 Hg Renewable Renewable 7,416 7,138 2006 5.9% 60.8%
Power Partners LP energy
7 Voyage Group Ltd Healthcare 8,755 6,946 2006 5.7% 66.5%
8 Mondo Minerals Industrials 7,004 6,852 2007 5.6% 72.1%
Co-op
9 Americana Consumer & 4,625 6,191 2007 5.1% 77.2%
International Leisure
Holdings Ltd
10 Casa Reha SARL Healthcare 8,151 5,274 2008 4.3% 81.5%
11 Achilles Group TMT 5,226 5,226 2008 4.3% 85.8%
Holdings Limited
12 SLV Electronik Industrials 5,962 4,190 2007 3.4% 89.2%
SARL
13 SHL Group Services 7,991 2,458 2006 2.0% 91.2%
Holdings 1 Ltd
14 Elite Holding SA TMT 5,749 2,410 2005 2.0% 93.2%
(t/a SiTel)
15 Hoseasons Group Consumer & 2,197 2,300 2003 1.9% 95.1%
Ltd Leisure
16 Atlas Energy Services 8,153 2,227 2007 1.8% 96.9%
Group Ltd
17 Software TMT 530 1,277 2006 1.1% 98.0%
(Cayman), LP - re
Blue Minerva
18 Cornish Bakehouse Consumer & 4,200 1,159 2007 1.0% 99.0%
Investments Ltd Leisure
19 Weston Presidio Fund 2,320 867 1998 0.7% 99.7%
Capital III, LP
20 Software TMT 253 592 2007 0.5% 100.2%
(Cayman), LP - re
Guildford
Total (Top 20 i 121,824 121,774 100.2% 100.2%
nvestments)
Other investments 30,440 948 0.8% 101.0%
(17)
Euro Hedge - (1,262) (1.0%) 100.0%
Total all 152,264 121,460 100.0% 100.0%
investments (37)
*Including investment valuation of £104,311,000 and accrued interest £
17,149,000.
†The above investments, other than Hg Renewable Power Partners LP, are held
through the Company's investment in HGT LP and HGT6 LP. See Note 1 of the
Financial Statements.
Income statement
for the six months ended 30 June 2009
Revenue return Capital return Total return
Six months Year ended Six months Year ended Six months Year ended
ended ended ended
Note 30.06.09 30.06.08 31.12.08 30.06.09 30.06.08 31.12.08 30.06.09 30.06.08 31.12.08
£'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
(unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited)
(Losses)/ - - - (6,698) 21,091 (4,491) (6,698) 21,091 (4,491)
gains on
investments
and
government
securities
Losses on 3(b) - - - (2,188) - - (2,188) - -
loans
receivable
from
General
Partner
Net income 6 2,885 11,136 12,068 - - - 2,885 11,136 12,068
Investment 7(a) 138 (450) (643) 415 (1,350) (1,930) 553 (1,800) (2,573)
management
fee rebate/
(charge)
Other 8(a) (312) (361) (932) - - - (312) (361) (932)
expenses
Net return/ 2,711 10,325 10,493 (8,471) 19,741 (6,421) (5,760) 30,066 4,072
(deficit)
on ordinary
activities
before
taxation
Taxation on 9 (758) (2,992) (3,048) (116) 391 550 (874) (2,601) (2,498)
ordinary
activities
Transfer to 1,953 7,333 7,445 (8,587) 20,132 (5,871) (6,634) 27,465 1,574
/(from)
reserves
Return/ 7.75p 29.11p 29.56p (34.09p) 79.93p (23.31p) (26.34p) 109.04p 6.25p
(deficit)
per
ordinary
share
The total column of this statement represents the Company's income statement.
The supplementary revenue and capital return columns are both prepared under
guidance published by the Association of Investment Companies ("AIC"). All
recognised gains and losses are disclosed in the revenue and capital columns of
the income statement and as a consequence no statement of total recognised
gains and losses has been presented.
All revenue and capital items in the above statement derive from continuing
operations.
Final dividend for the year ended 31 December 2008 of 25.00p (£6,297,000)
declared on 13 March 2009 and paid on 12 May 2009.
Final dividend for the year ended 31 December 2007 of 25.00p (£6,297,000)
declared on 13 March 2008 and paid on 1 May 2008.
Balance sheet
as at 30 June 2009
30.6.09 30.6.08 31.12.08
£'000 £'000 £'000
(unaudited) (unaudited) (audited)
Fixed assets
Investments held at fair value
Quoted at market valuation 84 2,224 -
Unquoted at Directors' valuation 104,227 134,619 94,732
104,311 136,843 94,732
Current assets
Debtors 17,516 17,655 16,258
Government securities 97,258 112,203 124,014
Cash 3,419 2,742 5,841
118,193 132,600 146,113
Creditors amounts falling due within (1,341) (9,458) (6,751)
one year
Net current assets 116,852 123,142 139,362
Net assets 221,163 259,985 234,094
Capital and reserves
Called up share capital 6,296 6,296 6,296
Share premium account 14,123 14,123 14,123
Capital redemption reserve 1,248 1,248 1,248
Capital reserve - realised 239,390 219,922 238,606
Capital reserve - unrealised (50,314) 3,744 (40,943)
Revenue reserve 10,420 14,652 14,764
Total equity shareholders' funds 221,163 259,985 234,094
Net asset value per ordinary share 878.1p 1,032.2p 929.4p
Cash flow statement
for the six months ended 30 June 2009
Note Six months Six months Year
ended ended ended
30.6.08 30.6.07 31.12.07
£'000 £'000 £'000
(unaudited) (unaudited) (audited)
Net cash (outflow)/inflow from operating 8(b) (4,248) 18 1,550
activities
Taxation refunded/(paid) 352 (3,026) (5,514)
Capital expenditure and financial
investment
Purchase of fixed asset investments (16,889) (15,901) (25,987)
Proceeds from the sale of fixed asset 1,651 61,340 86,027
investments
Net cash (outflow)/inflow from capital (15,238) 45,439 60,040
expenditure and financial investment
Equity dividends paid (6,297) (6,297) (6,297)
Net cash (outflow)/inflow before (25,431) 36,134 49,779
management of liquid resources
Management of liquid resources 23,009 (33,509) (44,055)
(Decrease)/increase in cash in the (2,422) 2,625 5,724
period
Reconciliation of movements in shareholders' funds
for the six months ended 30 June 2009
Note share Share Capital Capital Revenue Total
capital premium redemption reserves reserve £'000
£'000 account reserve £'000 £'000
£'000 £'000
At 31 December 2008 6,296 14,123 1,248 197,663 14,764 234,094
Net (deficit)/return - - - (8,587) 1,953 (6,634)
from ordinary activities
Dividends paid 4 - - - - (6,297) (6,297)
At 30 June 2009 6,296 14,123 1,248 189,076 10,420 221,163
At 31 December 2007 6,296 14,123 1,248 203,534 13,616 238,817
Net (deficit)/return - - - (5,871) 7,445 1,574
from ordinary activities
Dividends paid 4 - - - - (6,297) (6,297)
At 31 December 2008 6,296 14,123 1,248 197,663 14,764 234,094
Notes to the financial statements
1. Principal activity
The principal activity of the Company is that of an investment trust company.
The Company is an investment company as defined by section 833 of the Companies
Act 2006 and an investment trust within the meaning of section 842 of the
Income and Corporation Taxes Act 1988.
2. Basis of preparation
The accounts have been prepared in accordance with applicable UK law and
Accounting Standards (`GAAP') and with the Statement of Recommended Practice
`Financial Statements of Investment Trust Companies' (`SORP'), dated January
2003 and revised in December 2005. All of the Company's operations are of a
continuing nature.
The Company has considerable financial resources and as a consequence, the
Directors believe that the group is well placed to manage its business risks
successfully despite the current uncertain economic outlook. After making
enquiries, the Directors have a reasonable expectation that the Company will
have adequate resources to continue in operational existence for the
foreseeable future. Accordingly, they continue to adopt the going concern basis
in preparing the annual report and accounts.
The same accounting policies, presentation and methods of computation are
followed in the condensed set of financial statements as applied in the
Company's latest annual audited financial statements.
3. Organisational structure
In May 2003 (subsequently revised in January 2009) and January 2009, the
Company entered into partnership agreements with general and founder partners,
at which point investment holding limited partnerships were established to
carry on the business of an investor, with the Company being the sole limited
partner in these entities.
Under the partnership agreements, the Company made capital commitments of its
non-cash investment portfolio to HGT LP and HGT 6 LP ("funds"), with the result
that the Company now holds investments in the funds and all fixed asset
investments, excluding the investment in Hg Renewable Power Partners LP, are
now held by the funds. The fixed asset investments on the Balance Sheet and the
Investment portfolio above present the underlying investments held by the
funds.
Under the terms of the limited partnership agreements the general partner is
entitled to appropriate, as a first charge on the net income of the funds, an
amount equivalent to its priority profit share ("PPS"). In years in which the
funds have not yet earned sufficient net income to satisfy the PPS, the
entitlement is carried forward to the following years. The PPS is payable
quarterly in advance, even if insufficient net income has been earned. Where
the cash amount paid exceeds the net income, an interest free loan is advanced
to the general partner by the funds, which is funded via a loan from the
Company. This loan is only recoverable from the general partner by an
appropriation of net income; until net income is earned, no value is attributed
to this investment from the Company.
In addition to the PPS, the founder partner is entitled to a carried interest
distribution once certain preferred returns are met.
The agreements stipulate that the funds' income and capital gains, after
payment of the carried interest and the PPS, are distributed to the Company.
Consequently these amounts (including the associated cash flows) are shown in
the appropriate lines within the Income Statement, Cash Flow Statement and the
related notes, to then reflect the income and gains appropriated to the general
and founder partner in satisfaction of the PPS and carried interest, so as to
reflect the Company's proportion of net income and capital gains in the funds
that have been paid to the general and founder partner as its PPS and carried
interest.
The PPS paid from net income is charged to the revenue account, whereas the PPS
paid as an interest-free loan, is charged as an unrealised depreciation to the
capital account. The carried interest paid from net income and capital gains
are charged to the revenue and capital account respectively.
4. Dividends
It is intended that dividends will be declared and paid annually in respect of
each accounting period. A dividend of 25.00p per share, declared on 19 March
2009 as a final dividend, was paid on 11 May 2009 in respect of the year ended
31 December 2008 (year ended 31 December 2007: 25.00p per share, declared on 13
March 2008 and paid on 12 May 2008).
5. Issued share capital
There were 25,186,755 ordinary shares in issue for the six months ended 30 June
2009 and 30 June 2008; and the year ended 31 December 2008.
6. Income
Six months Six months Year ended
ended ended
30.6.09 30.6.08 31.12.08
£'000 £'000 £'000
(unaudited) (unaudited) (audited)
Income from investments
UK and overseas unquoted investment 3,239 8,765 7,115
income
UK dividends from unquoted investments 2 6 11
Gilt interest 374 2,271 4,704
3,615 11,042 11,830
Other income
Deposit interest 44 94 238
44 94 238
Total income 3,659 11,136 12,068
Priority profit share attribution (774) - -
Total net income 2,885 11,136 12,068
7. Fees, priority profit share and carried interest paid to Manager
(a) Investment management fee
The investment management fee is levied quarterly in arrears and charged 75% to
capital and 25% to revenue.
Revenue return Capital return
Six months Six months Year Six months Six months Year
ended ended ended ended ended ended
30.6.09 30.6.08 31.12.08 30.6.09 30.6.08 31.12.08
£'000 £'000 £'000 £'000 £'000 £'000
(unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited)
Investment management - 450 935 - 1,350 2,805
fee
VAT recovered (138) - (292) (415) - (875)
(138) 450 643 (415) 1,350 1,930
On 28 June 2007, the European Court of Justice announced that it had found in
favour of the Association of Investment Companies and JPMorgan Claverhouse
Trust plc in declaring that management expenses of investment trusts should be
exempt from VAT. HMRC has accepted this decision and the Company will therefore
no longer be charged VAT on management expenses. VAT for the period May 2003 to
September 2007 was recovered during the prior year. In June 2009, the Company,
through its previous Manager, recovered a further £553,000 of VAT charged by
that Manager during the period April 2001 to April 2003. Recovery of VAT
suffered prior to March 2001 remains uncertain and has not been recognised in
these Financial Statements.
(b) Priority profit share
Revenue return Capital return
Six months Six months Year Six months Six months Year
ended ended ended ended ended ended
30.6.09 30.6.08 31.12.08 30.6.09 30.6.08 31.12.08
£'000 £'000 £'000 £'000 £'000 £'000
(unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited)
Priority profit share 2,962 - - - - -
paid to General
Partners
Investment income (774) - - - - -
attribution
Loan recoverable (2,188) - - - - -
funding
- - - - - -
(c) Carried interest
Revenue return Capital return
Six months Six months Year Six months Six months Year
ended ended ended ended ended ended
30.6.09 30.6.08 31.12.08 30.6.09 30.6.08 31.12.08
£'000 £'000 £'000 £'000 £'000 £'000
(unaudited) (unaudited) (audited) (unaudited) (unaudited) (audited)
Carried interest - 5,795 5,132 - 5,795 5,132
payable to Founder
Partner
Gains on investments - (5,795) (5,132) - (5,795) (5,132)
attribution
- - - - - -
8. Other expenses
(a) Operating expenses
Six months Six months Year
ended ended ended
30.6.09 30.6.08 31.12.08
£'000 £'000 £'000
(unaudited) (unaudited) (audited)
Custodian and administration fees 134 146 260
Other administration costs 178 215 672
312 361 932
(b) Reconciliation of net revenue return before taxation to net cash flow from
operational activities
Six months Six months Year
ended ended ended
30.6.09 30.6.08 31.12.08
£'000 £'000 £'000
(unaudited) (unaudited) (audited)
Net (deficit)/return before taxation (5,760) 30,066 4,072
Loss/(gains) on investments held at 8,886 (26,886) (641)
fair value and loans
Priority profit share advanced (2,188) - -
Amortisation of premium on government 2,708 - -
securities
Movement in carried interest (5,132) (394) (1,057)
Increase in accrued income (1,711) (3,754) (1,904)
Decrease in debtors - 5 5
(Decrease)/increase in creditors (1,050) 981 1,076
Tax on investment income included (1) - (1)
within gross income
Net cash (outflow)/inflow from (4,248) 18 1,550
operating activities
9. Taxation
Tax for the six month period is charged at 28% (30% to 31 March 2008; 28% from
1 April 2008 to 31 December 2008), representing the best estimate of the
average annual effective tax rate expected for the full year, applied to the
pre-tax income of the six month period.
10. Capital commitments
At 30 June 2009, investment purchases of £9,605,000 (30 June 2008: £12,048,000
and 31 December 2008: £14,760,000) had been authorised and contractually
committed, including an undrawn commitment to Hg Renewable Power Partners LP.
The Company has committed to invest £250 million alongside the Manager's latest
buyout fund, HgCapital 6, increasing to a maximum of £300 million if the size
of the funds raised for HgCapital 6, including the Company's commitment,
reaches £2 billion. The Company has agreed to pay fees on its commitment. The
Company will be entitled, without penalty, to opt out of any investment which
could cause the Company to lose its status as an investment trust, result in
the Company not having the cash resources to meet any of its projected
liabilities or expenses, or result in it not being able to pay dividends or
undertake any intended share buy-back.
11. Publication of non-statutory accounts
The financial information contained in this half-yearly report does not
constitute statutory accounts as defined in Section 435 of the Companies Act
2006. The financial information for the six months ended 30 June 2009 and 2008
has not been audited. The information for the year ended 31 December 2008 has
been extracted from the latest published audited financial statements, which
have been filed with the Registrar of Companies. The report of the auditors on
those accounts contained no qualification or statement under section 237(2) or
(3) of the Companies Act 1985.
12. Annual results
The Board expects to announce the results for the year ending 31 December 2009
in March 2010.
The Annual report should be available by the end of March 2010, with the Annual
General Meeting being held in May 2010.
Independent review report
to HgCapital Trust plc
Introduction
We have been engaged by the Company to review the condensed set of financial
statements in the half-yearly financial report and accounts for the six months
ended 30 June 2009 which comprises the income statement, the balance sheet, the
cash flow statement, the reconciliation of movements in shareholders' funds and
related notes 1 to 12. We have read the other information contained in the
half-yearly financial report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in the condensed
set of financial statements.
This report is made solely to the company in accordance with International
Standard on Review Engagements (UK and Ireland) 2410 "Review of Interim
Financial Information Performed by the Independent Auditor of the Entity"
issued by the Auditing Practices Board. Our work has been undertaken so that we
might state to the company those matters we are required to state to them in an
independent review 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, for our review work, for this report, or for the conclusions
we have formed.
Directors' responsibilities
The half-yearly financial report is the responsibility of, and has been
approved by, the Directors. The Directors are responsible for preparing the
half-yearly financial report in accordance with the Disclosure and Transparency
Rules of the United Kingdom's Financial Services Authority.
As disclosed in note 2, the annual financial statements of the company are
prepared in accordance with United Kingdom Generally Accepted Accounting
Practice. The condensed set of financial statements included in this
half-yearly financial report have been prepared in accordance with the
accounting policies the group intends to use in preparing its next annual
financial statements.
Our responsibility
Our responsibility is to express to the Company a conclusion on the condensed
set of financial statements in the half-yearly financial report based on our
review.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410 "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making inquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly,
we do not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-yearly
financial report for the six months ended 30 June 2009 is not prepared, in all
material respects, in accordance with the Disclosure and Transparency Rules of
the United Kingdom's Financial Services Authority.
Deloitte LLP
Chartered Accountants and Statutory Auditors
London
27 August 2009
Management and Administration
Board of Directors
Roger Mountford (Chairman)
Timothy Amies
Piers Brooke
Richard Brooman
Peter Gale
Andrew Murison
HgCapital Trust plc
2 More London Riverside
London
SE1 2AP
www.hgcapitaltrust.com
Registered office
(Registered in England No. 1525583)
2 More London Riverside
London
SE1 2AP
Manager
HgCapital*â€
2 More London Riverside
London
SE1 2AP
Telephone: 020 7089 7888
www.hgcapital.com
Secretary and administrator
HgCapital*â€
2 More London Riverside
London
SE1 2AP
Telephone: 020 7089 7888
Stockbroker
Winterflood Securities*
The Atrium Building
Cannon Bridge
25 Dowgate Hill
London
EC4R 2EA
Telephone: 020 7621 0004
www.winsresearch.co.uk
Independent auditor
Deloitte LLP
2 New Street Square
London
EC4A 3BZ
Registrar
Computershare Investor Services plc*
The Pavilions
Bridgwater Road
Bristol
BS99 6ZY
Telephone: 0870 702 0131
www-uk.computershare.com/investor
AIC
Association of Investment Companies
www.theaic.co.uk
HgCapital Trust is a member of the Association of Investment Companies
LPEQ
Listed Private Equity
www.lpeq.com
HgCapital Trust is a founder member of LPEQ (formerly iPEIT). LPEQ is a group
of private equity investment trusts and similar vehicles listed on the London
Stock Exchange and other major European stock markets, formed to raise
awareness and increase understanding of what listed private equity is and how
it enables all investors - not just institutions - to invest in private equity.
LPEQ provides information on private equity in general, and the listed sector
in particular, undertaking and publishing research and working to improve
levels of knowledge about the asset class among investors and their advisers.
*Authorised and regulated by the Financial Services Authority.
†HgCapital is the trading name of Hg Pooled Management Limited
Monday, 20th May 2024
COMPANIES COVERED:
Latest directors dealings
- 40 minutes ago BT Group
- 45 minutes ago Dunelm Group
- 53 minutes ago PZ Cussons
- 1 hour ago Aquila Energy Efficiency Trust (EUR)
- 1 hour ago London Stock Exchange Group