Final Results
Hargreave Hale AIM VCT1 plc
Preliminary Announcement of Final Results for the year ending 30 September 2010.
FINANCIAL HIGHLIGHTS
Ordinary Shares: 2010 2009
Net asset value per share 62.67p 63.98p
Cumulative distributions paid since launch 19.0p 17.0p
Total return 81.67p 80.98p
Discount to Net Asset Value (based on bid market 15.0% 23.0%
price at balance sheet date)
Annual Returns per share:
Revenue return 0.07p (0.31)p
Capital return 0.21p (1.27)p
Return per share 0.28p (1.58)p
Dividends:
Interim paid 2.0p 2.0p
Final proposed - -
Total dividend for year 2.0p 2.0p
Performance Benchmark:
Total Return 86.0% 85.2%
FTSE AIM All-share Index 81.2% 67.0%
(results rebased to 100 at 29 October 2004)
CHAIRMAN'S STATEMENT
Introduction
I am pleased to report that the financial results for the year to 30 September
2010 show an improvement over the previous year. Â At 30 September 2010 the NAV
was 62.67 pence which after adjusting for the dividends paid gives a total
return of 81.67 pence. The gain per ordinary share for the year was 0.28 pence
per share (comprising revenue gains of 0.07 pence and capital gains of 0.21
pence).
I am pleased to report that the NAV on 10 December had risen to 68.77p per
share.
Investments
The Investment Manager, Hargreave Hale Limited, invested a further £0.98 million
in 5 qualifying companies during the year and 3 companies went into
administration realising a net loss of £1.4 million. The Fair Value of
qualifying investments at 30 September 2010 was £9.9 million invested in 41 AIM
companies and 1 unquoted company Mexican Grill Limited, the balance was held in
non-qualifying AIM stocks.
Dividend
An interim dividend of 2 pence was paid on 2 July 2010 (2009 - 2 pence).
A final dividend of 2 pence is proposed (2009 - Nil) which, subject to
shareholder approval at the AGM will be paid on 14 February 2011, to ordinary
shareholders on the register on 14 January 2011.
Buybacks
We were pleased that we were able to maintain our policy of offering our
shareholders an efficient exit route through the buyback scheme. Â In total,
1,621,991 Shares were purchased during the year at an average price of 56.3
pence per share.
Arrangements with Keydata Investment Services (KIS)/Change in Hargreave Hale's
Investment Management Agreement
On 8 June 2009 KIS went into administration. Â On the 29 September 2010 the
Company signed a variation agreement with KIS and PricewaterhouseCoopers (the
administrators of KIS) to terminate certain obligations between the Company and
KIS under offer agreements which related to previous offers of shares by the
Company and an administration agreement that was formerly in place. Â Of the
obligations terminated, these included the payment of annual fees of 0.9 per
cent. per annum and performance incentive fees by the Company to KIS, and the
payment by KIS of commissions to financial intermediaries in connection with
those offers (with the Company assuming the obligation for the payment of these
directly).
Since the year end, the Company and Hargreave Hale Limited entered into a deed
of variation on 15 December 2010 to vary the terms of the Investment Management
Agreement to increase the annual management fee payable to the Manager from 0.9
per cent. to 1.5 per cent. of the Net Asset Value of the Company. In exchange
Hargreave Hale Limited has agreed to provide an indemnity to cap the annual
running costs of the Company at 3.5 per cent. of the Net Asset Value (such costs
excluding VAT, any Performance Incentive Fee and any trail commissions the
payment of which is the responsibility of the Company) and cover any excess.
The effect of the change in annual management fee from 0.9 to 1.5 per cent.
would lead to an increase of £108,181 (based on the latest NAV as at 10 December
2010).
Joint Offer for Subscription of Ordinary Shares
On the 20 March 2010 a joint offer for subscription of Ordinary Shares of 1p
each in Hargreave Hale AIM VCT 1 plc and Hargreave Hale AIM VCT 2 plc to raise
up to, in aggregate, £10 million was offered to the public. In the tax year
2009/2010, the Offer resulted in funds being received of £0.66 million and 0.99
million shares have been issued in respect of Hargreave Hale AIM VCT 1 plc.
In the tax year 2010/2011, the Offer has resulted so far in funds being received
of £0.25 million and 0.39 million shares have been issued in respect of
Hargreave Hale AIM VCT 1 plc. The Offer opened on 20 March 2010 has been
extended and will now close on 18 March 2011 (unless fully subscribed earlier).
The allocation of successful applicants will be on a first come first served
basis, unless the maximum subscription under the offer has been exceeded, in
this case the directors reserve the right to exercise their discretion in
allocating shares. In respect of the ongoing Offer, to have full subscription
new funds will be limited to £6.09m in respect of Hargreave Hale AIM VCT 1 plc.
VCT Status
To maintain its VCT qualifying status we must invest at least 70% of the net
funds raised in any one accounting period in qualifying investments within three
years. At the year end we had achieved 80.12% and have satisfied all the
relevant tests.
UK Listing Rule Changes
As a public listed company, Hargreave Hale AIM VCT 1 plc is required to comply
with the regulations of the UK listings Authority. Certain changes to the
existing Board were required prior to the new UKLA regulations on Board
independence which came into effect on 28 September 2010. As a result of these
changes, on the 28 September 2010, David Hurst-Brown resigned as a non executive
director of the company. I should like to thank David for all his help and
sagacity since we started. David Brock whose biography is on page 7 was
appointed in his place.
Outlook
Whilst the economy seems to have avoided the worst recession that was feared the
cost has been an unprecedented level of Government borrowings and an enormous
ongoing budget deficit. The new government has recognised that this is not
sustainable for long and has started to make cuts. It faces a hard balancing act
between fiscal rectitude and killing off the green shoots of recovery.
I am hopeful that we will see continued recovery but there is little doubt that
we live in uncertain economic times. If the market suffers a reversal we may see
share prices go lower. Because a VCT has to maintain 70 per cent. of its assets
in qualifying companies the manager would have little scope to sell assets in
such circumstances. However, whilst we may see a short term drop in Net Asset
Value, I believe that your portfolio is largely comprised of robust companies
with competent management and good growth plans and will be well placed to
weather any such storm.
Sir Aubrey Brocklebank Bt
Chairman
Date: 20 December 2010
INCOME STATEMENT
For the year ended 30 September 2010
 Ordinary Shares
 Revenue Capital Total
 £000 £000 £000
Net gain on investments held at fair - 165 165
value through profit or loss
Income 296 - 296
 -------- -------- --------
 296 165 461
 -------- -------- --------
Management fee (36) (110) (146)
Other expenses (242) - (242)
 -------- -------- --------
 (278) (110) (388)
 -------- -------- --------
Profit on ordinary activities before 18 55 73
taxation
Taxation - - -
 -------- -------- --------
Profit after taxation 18 55 73
 -------- -------- --------
Profit per share (pence) 0.07p 0.21p 0.28p
 --------     --------    --------
INCOME STATEMENT
For the year ended 30 September 2009
 Ordinary Shares
 Revenue Capital Total
 £000 £000 £000
Net loss on investments held at fair value through - (266) (266)
profit or loss
Income 362 - 362
 -------- -------- --------
 362 (266) 96
 -------- -------- --------
Management fee (39) (118) (157)
Other expenses (415) - (415)
 -------- -------- -------
 (454) (118) (572)
 -------- -------- -------
Loss on ordinary activities before taxation (92) (384) (476)
Taxation - - -
 -------- -------- --------
Loss after taxation (92) (384) (476)
 -------- -------- --------
Loss per share (0.31)p (1.27)p (1.58)p
The total column of these statements is the income statement of the Company. All
revenue and capital items in the above statement derive from continuing
operations. There are no recognised gains or losses other than the loss for the
year.
BALANCE SHEET Company registration number:
5206425
As at 30 September 2010 (in England and Wales)
 2010 2009
 Ordinary Ordinary
 £000 £000
Fixed assets
Investments at fair value through profit or 15,530 16,079
loss
 -------- --------
Current assets
Debtors 94 95
Cash at bank 1,088 1,059
 -------- --------
 1,182 1,154
Creditors: amounts falling due within one (160) (129)
year
 -------- --------
Net current assets 1,022 1,025
 -------- --------
Net assets 16,552 17,104
 -------- --------
Capital and Reserves
Called up share capital 291 294
Special reserve 21,263 21,901
Capital reserve - realised (3,637) (2,871)
Capital reserve - unrealised (2,312) (3,133)
Revenue reserve 185 167
Capital redemption reserve 762 746
 -------- --------
Equity shareholders' funds 16,552 17,104
 -------- --------
Net asset value per share 62.67p 63.98p
CASH FLOW STATEMENT
For the year ending 30 September 2010
 2010 2009
 Ordinary Ordinary
 £000 £000
Net cash (outflow)/inflow from operating activities (60) (101)
Net financial investment 714 4,349
Dividends paid (537) (864)
 --------- ---------
Cash outflow before management of liquid resources 117 3,384
Financing (88) (2,934)
 --------- ---------
Increase in cash 29 450
 --------- ---------
RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS
For the year ending 30 September 2010
  Capital Capital Capital
Ordinary Share Redemption Reserve Reserve Special Revenue Total
Shares Capital Reserve Realised Unrealised Reserve Reserve
 £000 £000 £000 £000 £000 £000 £000
At 1 October 294 746 (2,871) (3,133) 21,901 167 17,104
2009
Previously -
recognised
losses now
realised   - (656) - - - (656)
Unrealised     - - 821 - - 821
gains on  -
investments
Management     - (110)    (110)
fee charged  -
to capital
Share (16) 16 - - (913) - (913)
buybacks
Subscriptions    - - - 812 - 825
 13
Equity - - - - (537) - (537)
dividends
paid
Revenue loss - - - - - 18 18
after
taxation for
the period
 ------ ------ --------- --------- --------- ------ ---------
At 30 291 762 (3,637) (2,312) 21,263 185 16,552
September
2010
 ------ ------ --------- --------- --------- ------ ---------
Reserves available for distribution are capital reserve realised, special
reserve and revenue reserve.
RECONCILIATION OF MOVEMENT IN SHAREHOLDERS' FUNDS
For the year ending 30 September 2009
  Capital Capital Capital
Ordinary Share Redemption Reserve Reserve Special Revenue Total
Shares Capital Reserve Realised Unrealised Reserve Reserve
 £000 £000 £000 £000 £000 £000 £000
At 1 October 103 40 61 (3,301) 9,772 163 6,838
2008 (Ord
shares)
At 1 October
2008
(C shares 886 11 (21) (2,359) 15,927 96 14,540
transferred)
Transfer of (666) 666 - - - - -
conversion of
C shares
 -------- -------- -------- -------- -------- -------- --------
 323 717 40 (5,660) 25,699 259 21,378
Realised -
gains on
investments
Previously - - (2,793) - - - (2,793)
recognised
losses now
realised
Unrealised    - - - 2,527 - - 2,527
losses on
investments
Management     - - (118) - - - (118)
fee charged
to capital
Share (29) 29 - - (2,934) - (2,934)
buybacks
Equity     - - - (864) - (864)
dividends -
paid
Revenue - - - - - (92) (92)
profit after
taxation for
the year
 -------- -------- -------- -------- -------- -------- --------
At 30 294 746 (2,871) (3,133) 21,901 167 17,104
September
2009
 -------- -------- -------- -------- -------- -------- --------
Notes to the preliminary announcement
1. The financial information set out in this preliminary announcement does not
constitute the Company's statutory accounts for the years ended 30 September
2010 or 30 September 2009. Statutory accounts for the year ended 30
September 2009 have been filed with the Registrar of Companies and those of
the year ended 30 September 2010 will be delivered to the Registrar in due
course; both have been reported on by the Independent Auditors. The
independent auditors' report on the Financial Statements for the year ended
30 September 2009 was unqualified, did not draw attention to any matters by
way of emphasis, and did not contain a statement under 498(2) or 498(3) of
the Companies Act 1985. The independent auditors' report on the Financial
Statements of the year ended 30 September 2010 was unqualified, did not draw
attention to any matters by way of emphasis, and did not contain a statement
under 498(2) or 498(3) of the Companies Act 2006. The financial information
in this preliminary announcement has been prepared under the historical cost
convention, except for the revaluation of certain financial instruments, and
in accordance with UK GAAP and with the Statement of Recommended Practise
(SORP) for Financial Statements of Investment Trust Companies issued in
January 2009. The accounting policies adopted in these preliminary results
have been consistently applied to all the years presented and are consistent
with the policies used in the preparation of the statutory accounts for the
year ended 30 September 2010. The full statutory annual accounts will be
published in January 2010. Copies may in due course be obtained during
normal business hours from Hargreave Hale Limited, 9-11 Neptune Court,
Hallam Way, Blackpool, FY4 5LZ.
    The Annual general meeting of the company will be held at the Company's
registered office on 10 February 2011 at 11.00am.
2. Revenue return per ordinary share is based on a net revenue gain on ordinary
activities after tax of £18,000 (2009 £92,000 loss) and on 26,416,692 (2009
29,963,737) ordinary shares, being the weighted average number of ordinary
shares in issue during the year. Capital return per ordinary share is based
on a net capital profit on ordinary activities after tax of £55,000 (2009
£384,000 loss) and on 26,416,692 (2009 29,963,737) ordinary shares, being
the weighted average number of ordinary shares in issue during the year.
3. The net asset value per ordinary share at 30 September 2010 of 63.98p (2008
62.67p) is based on net assets of £16,552,000 (2009 £17,104,000) and on
26,410,352 shares, being the number of ordinary shares in issue as at 30
September 2010 (2009 26,733,966).
INVESTMENT PORTFOLIO SUMMARY
Ordinary Share Fund
As at 30 September 2010
 Book Cost Valuation Valuation
Qualifying investments £000 £000 %
Abcam Plc      125      1,290 8.3
Advanced Computer Software      400       753 4.9
Craneware      150       633 4.1
Intercede Group      518       627 4.0
Brulines Holdings      509       497 3.2
Animal Care      300       491 3.2
EKF (formerly IBL) Â Â Â Â Â 300 Â Â Â Â Â Â 485 3.1
Mount Engineering      400       428 2.8
K3 Business Tech Group      270       411 2.6
Pressure Technologies      340       397 2.6
Cohort plc      800       381 2.5
Bglobal      258       320 2.1
Vertu Motors      600       265 1.7
I-Dox      150       230 1.5
Keycom      300       225 1.4
Rotala      400       218 1.4
Egdon Resources plc      158       189 1.2
Neutra Health plc      315       187 1.2
Mexican Grill A Preference      185       185 1.2
Chime (formerly Essentially Group) Â Â Â Â Â 220 Â Â Â Â Â Â 178 1.2
Universe Group      385       165 1.1
Energetix Group      380       146 0.9
CBG Group      534       109 0.7
Feedback      201       101 0.7
Maxima Holdings      251        99 0.6
Plastics Capital      250        95 0.6
Reneuron Group      238        92 0.6
Advanced Power Components      148        87 0.6
Tasty plc      288        85 0.5
Autoclenz Holdings      256        78 0.5
Jelf Group      174        74 0.5
Tangent Communications      300        69 0.4
Progressive Digital      173        68 0.4
Richoux      300        60 0.4
Infrastrata (formerly Portland Gas) Â Â Â Â Â Â 46 Â Â Â Â Â Â Â 36 0.2
Expansys      331        31 0.2
Mexican Grill       20        20 0.1
Invocas Group      169        12 0.1
Hardide      396        11 0.1
Enfis Group      146        10 0.1
Invu      200         7 0.0
Infoserve Group      200         6 0.0
Sports Media Group      300         4 0.0
 -------- --------- -------
Total qualifying investments 12,384 9,855 63.5
 Book Cost Valuation Valuation
Non-Qualifying investments £000 £000 %
UK Treasury 2.25% 2014 978 1,034 6.7
Uk Treasury 2.5% 2016 492 550 3.5
 -------- --------- -------
Total - UK gilts 1,470 1,584 10.2
Lloyds TSB 4% 2011 1,024 1,031 6.6
Nationwide 3.75% 2011 1,018 1,029 6.6
Scot Amicable 8.5% 2049 256 253 1.6
Nationwide 7.971% 2049 242 250 1.6
 -------- --------- -------
Total - UK corporate bonds 2,540 2,563 16.4
Easyjet 188 185 1.2
City of London 121 157 1.0
Anglo Pacific 106 150 1.0
OPG 133 139 0.9
West Coal 167 136 0.9
TT Elect 70 106 0.7
Skill P&L 100 100 0.6
EMIS 82 98 0.6
Cove Energy plc 35 71 0.5
Westhouse Holdings plc 90 68 0.4
Acta 60 60 0.4
Expansys 60 59 0.4
DDD 75 57 0.4
Petro Matad 41 55 0.4
Optare plc 80 46 0.3
Cap-XX 20 21 0.1
Craneware 11 16 0.1
Animalcare Group plc 2 2 0.0
Advanced Computer Software plc 2 1 0.0
Vertu Motors 3 1 0.0
EKF 0 0 0.0
Enfis Group plc 1 0 0.0
Tasty Plc 1 0 0.0
 -------- --------- -------
Total - non-qualifying equities 1,448 1,528 9.9
 -------- --------- -------
Total - non-qualifying investments 5,458 5,675 36.5
 --------- --------- -------
Total investments 17,842 15,530 100.0
 --------- --------- -------
20 December 2010
For further information please contact:
Stuart Brookes
Company Secretary
Hargreave Hale AIM VCT1 plc
0207 009 4900
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Hargreave Hale AIM VCT 1 plc via Thomson Reuters ONE
[HUG#1474259]
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