Interim Results

Keydata AIM VCT PLC 24 May 2006 KEYDATA AIM VCT plc Unaudited Interim Results for the six months ending 31 March 2006 Chairman's Statement I am pleased to report that your Company continued to make good progress in the six month period ended 31 March 2006. Funding The 2005/6 C share offer for subscription closed on 5 April 2006 with gross funds raised of around £17.9 million from 1,077 investors. The costs of the launch were set at 5 per cent of the gross funds raised and the net proceeds retained by the company will be £17.0 million, with an initial asset value per C share of 95p. The net assets stated in the balance sheet reflect allotment proceeds received as at 31 March 2006. Including the £13.6 million of net funds raised in 2004/5 from the ordinary share offer for subscription, the Company has raised £30.6 million of net funds in total. Your board believes that the fund is now an optimum size and will benefit through a reduced total expense ratio. Results - Ordinary Fund The net asset value per ordinary share increased by 7.95 per cent to 111.96 pence during the period. Earnings per ordinary share for the period were 8.26 pence per share (comprising revenue earnings of 0.13 pence and capital earnings of 8.13 pence). The Investment Manager, Hargreave Hale, invested a further £2.8 million in eleven qualifying AIM companies during the period and made part disposals of seven of the AIM investments, realising a net gain on sale of £0.6 million in the period. The main contributors to this realised gain were Egdon Resources and Accuma. The bid value of qualifying investments at 31 March 2006 was £8.35 million invested in 25 AIM companies. With respect to the 70 per cent investment test, as at 31 March 2006, 45.9 per cent of the Company's investments were in Qualifying companies. The balance was held in short dated Treasury gilts. We have until 30 September 2007 to meet the 70 per cent test. Results - C Fund The net asset value per C share at 31 March 2006 was 95 pence per share. Earnings per C share were 0.02 pence per share. No investments were made prior to the Offer closing on 5 April 2006. We have until 30 September 2008 to meet the 70 per cent test. Dividend We are delighted to declare a tax free capital dividend payable to ordinary shareholders of 5 pence per share. This interim dividend will be payable on 14 July 2006 to ordinary shareholders on the share register on 16 June 2006. On 23 May 2006, the Company revoked investment company status to facilitate the payment of dividends out of capital profits. The dividend policy is to distribute realised capital profits to shareholders as they arise, therefore dividend payments will not be predictable or regular in nature. A final dividend will only be payable if we make sufficient capital profits in the second half of the year. No dividend is proposed on the C shares in respect of the period. VCT Rules The changes to the VCT rules announced in the Budget on 22 March 2006 do not have any impact on funds already raised by the Company. They do however require that any funds raised by the Company through an allotment of shares on or after 6 April 2006 (including any dividends re-invested in the Company under the terms of its Dividend Reinvestment Schemes) will need to be administered in accordance with new rules which have yet to be clarified in detail. In particular, the proposed changes to the gross assets test for qualifying holdings (reduced from £15 million to £7 million) will substantially reduce the universe of qualifying companies. If we were to raise new funds from now on, these funds would have to be invested using the new rules which might preclude co-investment with the existing funds and would have to be accounted for separately. As a result, the Directors have decided to suspend the operation of the Dividend Reinvestment Schemes. All shareholders will therefore receive dividends in cash without the option of reinvesting that amount in shares of the company. Outlook We remain confident that we will achieve our required 70% investment in qualifying companies within the three year period. The AIM market remains very active and we continue to experience a good pipeline of investment opportunities from which we can select those which we believe have significant growth potential. Shareholder Communication The Company's daily share price can be found on various financial websites under the EPIC code 'KEY' for ordinary shares and 'KEYC' for C shares, or on our own dedicated website at www.keydataaimvct.co.uk Sir Aubrey Brocklebank Bt Chairman 23 May 2006 Income Statement for the six months to 31 March 2006 - Ordinary Shares For the six months to 31 March 2006 (unaudited) Revenue Capital Total £000 £000 £000 Realised gains on investments - 609 609 Unrealised gains on investments 614 614 Income 209 - 209 -------- -------- -------- 209 1,223 1,432 Management fee (21) (62) (83) Other expenses (165) - (165) -------- -------- -------- (186) (62) (248) -------- -------- -------- Profit before taxation 23 1,161 1,184 Taxation (5) 5 - -------- -------- -------- Profit after taxation 18 1,166 1,184 -------- -------- -------- Earnings per share (Note 2) 0.13p 8.13p 8.26p Income Statement for the six months to 31 March 2006 - C shares For the six months to 31 March 2006 (unaudited) Revenue Capital Total £000 £000 £000 Realised gains on investments - - - Unrealised gains on investments - - - Income 9 - 9 -------- -------- -------- 9 - 9 Management fee (1) (3) (4) Other expenses (5) - (5) -------- -------- -------- (6) (3) (9) -------- -------- -------- Profit before taxation 3 (3) - Taxation - - - -------- -------- -------- Profit after taxation 3 (3) - -------- -------- -------- Earnings per share (Note 2) 0.12p (0.10)p 0.02p Income Statement for the six months to 31 March 2006 - Company For the six months to 31 March 2006 (unaudited) Revenue Capital Total £000 £000 £000 Realised gains on investments - 609 609 Unrealised gains on investments 614 614 Income 218 - 218 -------- -------- -------- 218 1,223 1,441 Management fee (22) (65) (87) Other expenses (170) - (170) -------- -------- -------- (192) (65) (257) -------- -------- -------- Profit before taxation 26 1,158 1,184 Taxation (5) 5 - -------- -------- -------- Profit after taxation 21 1,163 1,184 -------- -------- -------- The total column of this statement is the income statement of the Company. All revenue and capital items in the above statement derive from continuing operations. Income Statement for the period 16 August 2004 to 31 March 2005 - Company For the period 16 August 2004 to 31 March 2005 (unaudited) Revenue Capital Total £000 £000 £000 Realised gains on investments - - - Unrealised gains on investments - 468 468 Income 66 - 66 -------- -------- -------- 66 468 534 Management fee (16) (47) (63) Other expenses (77) - (77) -------- -------- -------- (93) (47) (140) -------- -------- -------- Profit before taxation (27) 421 394 Taxation - - - -------- -------- -------- Profit after taxation (27) 421 394 -------- -------- -------- Earnings per share (0.37)p 5.93p 5.56p The total column of this statement is the income statement of the Company. All revenue and capital items in the above statement derive from continuing operations. These figures relate solely to ordinary shares as the C shares were issued from January 2006. Income Statement for the period 16 August 2004 to 30 September 2005 - Company For the period 16 August 2004 to 30 September 2005 (audited) Revenue Capital Total £000 £000 £000 Realised losses on investments - (32) (32) Unrealised gains on investments - 1,348 1,348 Income 303 - 303 -------- -------- -------- 303 1,316 1,619 Management fee (28) (84) (112) Other expenses (258) - (258) -------- -------- -------- (286) (84) (370) -------- -------- -------- Profit before taxation 17 1,232 1,249 Taxation (3) 3 - -------- -------- -------- Profit after taxation 14 1,235 1,249 -------- -------- -------- Earnings per share 0.14p 12.15p 12.29p The total column of this statement is the income statement of the Company. All revenue and capital items in the above statement derive from continuing operations. These figures relate solely to ordinary shares as the C shares were issued from January 2006. Balance sheet as at 31 March 2006 As at 31 March 2006 (unaudited) Ordinary Shares C Shares Total £000 £000 £000 Fixed assets Investments 15,316 - 15,316 -------- -------- -------- Current assets Prepayments and accrued income 64 - 64 Cash at bank and on deposit 751 11,508 12,259 ------- -------- -------- 815 11,508 12,323 Creditors: amounts falling due within one year Accruals and deferred income (78) (9) (87) ------- ------- -------- Net current assets 737 11,499 12,236 ------- ------- -------- Net assets 16,053 11,499 27,552 ------- ------- -------- Capital and Reserves Called up share capital 143 121 264 Share premium - 11,378 11,378 Capital reserve - realised 439 (3) 435 Capital reserve - unrealised 1,962 - 1,963 Special reserve 13,477 - 13,477 Revenue reserve 32 3 35 -------- -------- -------- Equity shareholders' funds 16,053 11,499 27,552 -------- ------- -------- Net asset value per share (Note 4) 111.96p 95.0p Balance sheet as at 31 March 2005 - Ordinary shares only As at 31 March 2005 (unaudited) £000 Fixed assets Investments 2,630 ------- Current assets Prepayments and accrued income 2 Cash at bank and on deposit 5,842 -------- 5,844 Creditors: amounts falling due within one year Accruals and deferred income (65) -------- Net current assets 5,779 -------- Net assets 8,409 -------- Capital and Reserves Called up share capital 84 Share premium 7,931 Capital reserve - realised (47) Capital reserve - unrealised 468 Revenue reserve (27) -------- Equity shareholders' funds 8,409 -------- Net asset value per share 99.67p Balance sheet as at 30 September 2005 - Ordinary shares only As at 30 September 2005 (audited) £000 Fixed assets Investments 9,501 ------- Current assets Prepayments and accrued income 45 Cash at bank and on deposit 5,368 -------- 5,413 Creditors: amounts falling due within one year Accruals and deferred income (44) -------- Net current assets 5,369 -------- Net assets 14,870 -------- Capital and Reserves Called up share capital 143 Share premium - Capital reserve - realised (113) Capital reserve - unrealised 1,348 Special reserve 13,478 Revenue reserve 14 -------- Equity shareholders' funds 14,870 -------- Net asset value per share 103.71p Cash flow statement for the six months to 31 March 2006 For the six months to 31 March 2006 (unaudited) Ordinary Shares C Shares Total £000 £000 £000 Profit before taxation 23 3 26 Management fee charged to capital (62) (3) (65) Increase in debtors (19) - (19) Increase in creditors 34 9 43 ------- ------- -------- Net cash outflow from operating activities (24) 9 (15) Financial investment Purchase of investments (5,773) - (5,773) Sale of investments 1,181 - 1,181 Financing Net proceeds from issue of share capital - 11,498 11,498 --------- -------- -------- (Decrease)/increase in cash (4,616) 11,507 6,891 --------- -------- -------- Cash flow statement for the period 16 August 2004 to 31 March 2005 - Ordinary shares only For the period 16 August 2004 to 31 March 2005 (unaudited) £000 Profit before taxation (27) Management fee charged to capital (47) Increase in debtors (2) Increase in creditors 65 -------- Net cash outflow from operating activities (11) Financial investment Purchase of investments (2,162) Financing Net proceeds from issue of ordinary share capital 8,015 -------- Increase in cash 5,842 -------- Cash flow statement for the period 16 August 2004 to 30 September 2005 - Ordinary shares only For the period 16 August 2004 to 30 September 2005 (audited) £000 Profit before taxation 17 Management fee charged to capital (84) Increase in debtors (45) Increase in creditors 44 -------- Net cash outflow from operating activities (68) Financial investment Purchase of investments (8,228) Sale of investments 43 Financing Net proceeds from issue of ordinary share capital 13,621 -------- Increase in cash 5,368 -------- Reconciliation of movements in shareholders' funds for the six months to 31 March 2006 (unaudited) Ordinary Shares Share Capital Capital Special Revenue Premium Reserve Reserve Reserve Reserve Realised Unrealised £000 £000 £000 £000 £000 At 1 October 2005 - (113) 1,348 13,477 14 Realised gains on investments - 609 - - - Unrealised gains on investments - - 614 - - Management fee charged to capital - (62) - - - Tax relief - 5 - - - Profit after taxation for the period - - - - 18 ------ ------ ------ -------- -------- At 31 March 2006 - 439 1,962 13,477 32 ------ ------ ------ -------- -------- C Shares Share Capital Capital Special Revenue Premium Reserve Reserve Reserve Reserve Realised Unrealised £000 £000 £000 £000 £000 At 1 October 2005 - - - - - Proceeds from issue of shares 11,983 - - - - Costs related to issue of shares (605) - - - - Realised gains on investments - - - - - Unrealised gains on investments - - - - - Management fee charged to capital - (4) - - - Tax relief - 1 - - - Profit after taxation for the period - - - - 3 ------ ------ ------ -------- -------- At 31 March 2006 11,378 (3) - - 3 ------ ------ ------ -------- -------- Notes to the interim report 1 The accounts of the company are prepared in accordance with Accounting Standards applicable in the United Kingdom. The accounting policies used in preparing this report are consistent with those adopted at the year end. All AIM investments are valued at bid price. 2 The earnings per ordinary share of 8.26p is based on the profit after tax for the period of £1,183,583 and the weighted average number of ordinary shares in issue over the period to 31 March 2006 of 14,337,731. The earnings per C share of 0.02p is based on the profit after tax for the period of £378 and the weighted average number of C shares in issue over the period to 31 March 2006 of 2,478,928. 3 The results should not be taken as a guide to the results for the period ending 30 September 2006 4 The net asset value per ordinary share at 31 March 2006 of 111.96p is based on net assets of £16,053,179 and on 14,337,731 shares, being the number of ordinary shares in issue as at 31 March 2006. The net asset value per C share at 31 March 2006 of 95.0p is based on net assets of £11,498,884 and on 12,103,691 shares, being the number of C shares in issue as at 31 March 2006. 5 The financial information contained in the 31 March 2006 income statement, balance sheet, cash flow statement and reconciliation of movements in shareholders' funds does not constitute full financial statements and has not been audited. The foregoing information at 30 September 2006 is an abridged and revised version of the Company's full accounts which carry an unqualified Auditor's report and have been filed with Registrar of Companies. Investment portfolio summary as at 31 March 2006 - Ordinary Share Fund Qualifying investments Book cost Valuation Valuation £000 £000 % Accuma 285 813 5.3 Internet Business Group 259 630 4.1 Egdon Resources 128 599 3.9 Hardide 396 531 3.5 Ascribe 250 458 3.0 Zenith Hygiene Group 281 435 2.8 Jelf Group 250 380 2.5 Abcam 250 363 2.4 Cohort 301 350 2.3 Neutra Health 315 345 2.3 Mama 300 330 2.1 Work Group 300 306 2.0 K3 Business Technology Group 270 294 1.9 Sectorguard 250 268 1.8 Autoclenz 256 267 1.7 Invocas Group 169 266 1.7 Axeon 200 252 1.6 FDM Group 250 250 1.6 Maxima Holdings 250 246 1.6 Gourmet Holdings 300 234 1.5 York Pharma 250 198 1.3 Centrom 300 195 1.3 Transense Technologies 200 165 1.1 Sarantel Group 302 129 0.8 Plethora Solutions 44 40 0.3 Mama warrants - 8 0.1 -------- -------- -------- Total qualifying investments 6,356 8,352 54.5 Non-qualifying investments Treasury 4.5% Stock 2007 4,020 4,003 26.1 Treasury 4% Stock 2009 2,977 2,961 19.4 -------- -------- -------- Total non-qualifying investments 6,997 6,964 45.5 -------- ------- -------- Total investments 13,353 15,316 100.0 -------- -------- -------- Top ten investments at 31 March 2006 by valuation 1. Accuma Group PLC Investment date March 2005 & Audited figures for year to July 2005 August 2005 Equity held 1.18% Turnover (£'000) 2,846 Purchase price per share 82p & 155p Loss before tax (£'000) (473) Cost (£'000) 285 Retained loss (£'000) (398) Valuation (£'000) 813 Net assets(£'000) 3,838 Accuma advises on debt solutions, in particular, Individual Voluntary Arrangements. This is a fragmented but rapidly growing market in which Accuma has grown its share to 12% through organic growth and the acquisition of Wilson Phillips. Unlike many debt solutions, an Accuma IVA is free to the debtor, runs for a finite period, is legally binding and affords the creditor above average recovery rates. A further investment was made via a secondary placing on 31 August 2005. The company reported strong H1 2006 figures on 28th March 2006. 50% of our holding was sold in May 2006. 2. Internet Business Group Plc Investment date July 2005 Audited figures for year to October 2005 Equity held 3.10% Turnover (£'000) 6,322 Purchase price per share 11.5p Loss before tax (£'000) 413 Cost (£'000) 259 Retained loss (£'000) 441 Valuation (£'000) 630 Net assets (£'000) 1,490 Internet Business Group PLC ('IBG') focuses on enabling e-commerce through the application of specialised marketing and technology. IBG's business to business operations include AffiliateFuture, a leading performance marketing network, web hosting, and web development. IBG's business to consumer activities lie with its e-commerce properties retailing some 2,000 lines across several sectors within sports and lifestyle. Plentypoints.com, providing consumer rewards for online activities, links these e-commerce properties to AffiliateFuture. 3. Egdon Resources PLC Investment date December 2004 Audited figures for year to July 2005 Equity held 0.22% Turnover (£'000) 11 Purchase price per 30p Loss before tax (£'000) (421) share Cost (£'000) 128 Retained loss (£'000) (421) Valuation (£'000) 599 Net assets (£'000) 5,584 Egdon is an independent UK based energy company with over 50 oil and gas prospects spread over 20 exploration licenses in the UK and France. Management's intention is to become a significant and profitable oil and gas producer through an active and focused exploration and appraisal programme. The company is currently developing plans for a 36 billion cubic feet underground gas storage facility at Portland. 4. Hardide PLC Investment date March 2005 Proforma figs for year to September 2005 Equity held 2.68% Turnover (£'000) 1,088 Purchase price per 10p Loss before tax (£'000) (701) share Cost (£'000) 396 Retained loss (£'000) (701) Valuation (£'000) 531 Net assets (£'000) 2,056 Hardide was incorporated in August 2000 to develop and commercialise Hardide technology jointly developed by the University of Moscow and the Russian Academy of Science Institute of Physical Chemistry. Hardide is a patented surface coating technology which combines ultra-hardness, low friction and chemical resistance for use with steel, hard alloys and other materials. When applied via chemical vapour deposition to components, the tungsten carbide coating typically extends the component's useful life. The company moved to Oxfordshire in 2003 where it has 3 coating machines in a 12,500 sq. ft. facility. The company raised an additional £796,209 in December 2005 to cover the start up costs of a U.S manufacturing facility in Houston, Texas. 5. Ascribe PLC Investment date December 2004 Audited figures for year to June 2005 Equity held 1.30% Turnover (£'000) 5,347 Purchase price per 18p Profit before tax (£'000) 794 share Cost (£'000) 250 Retained profit (£'000) 445 Valuation (£'000) 458 Net Assets (£'000) 6,370 Ascribe is a health IT group focusing on medicine management through the development and marketing of software solutions supporting patient, clinical and business processes to the international healthcare market. Ascribe is aiming to provide a centralised database of prescriptions available to all healthcare professionals. The company now has over 300 customer sites worldwide, including installations throughout the UK, Australia, New Zealand, Hong Kong and Malaysia. 6. Zenith Hygiene Group plc Investment date January 2005 Audited figures for year to August 2005 Equity held 1.83% Turnover (£'000) 24,519 Purchase price per 100p Profit before tax (£'000) 967 share Cost (£'000) 281 Retained profit (£'000) 360 Valuation (£'000) 435 Net assets (£'000) 5,273 Zenith Hygiene manufactures, and supplies cleaning and non food ancillary products to the restaurant, hospitality, healthcare and leisure markets. Although growing organically, the company has made five acquisitions to gain market share, established its own manufacturing capability and developed regional hubs. 7. Jelf Plc Investment date February 2006 Audited figures for year to September 2005 Equity held 0.97% Turnover (£'000) 11,501 Purchase price per 106 Profit before tax (£'000) 1,011 share Cost (£'000) 250 Retained profit (£'000) 663 Valuation (£'000) 380 Net assets (£'000) 4,432 Jelf Group is a broker of corporate services, with separate divisions in Healthcare, Insurance, and Financial Services. Customers are in the corporate and private client sectors. The business has grown acquisitively since it started in 1989 and has bought 11 companies in the last five years. The market is very fragmented, with smaller players unable to compete due to rising costs of training and compliance. Acquisitions are earnings enhancing as back office costs can be easily stripped out. Furthermore, there are also additional cross selling opportunities to the acquired customer base. We acquired shares in a recent £4m fund raising to acquire Goss Group Ltd. 8. Abcam plc Investment date October 2005 Audited figures for year to June 2005 Equity held 0.43% Turnover (£'000) 12,135 Purchase price per 167p Profit before tax (£'000) 2,977 share Cost (£'000) 250 Retained profit (£'000) 964 Valuation (£'000) 363 Net assets (£'000) 3,215 Abcam is a global distributor of research-grade antibodies to bioscientists and intends to build the largest online catalogue of the best available antibodies. Whilst they manufacture many of their own lines of antibodies, they also source others from institutes, academic laboratories and primary manufacturers around the world. The company is headquartered in Cambridge, where it was founded in 1998, and maintains a US office in Massachusetts. 9. Cohort Plc Investment date February 2006 Audited figures for year to April 2005 Equity held 1.11% Turnover (£'000) 14,432 Purchase price per 123p Profit before tax (£'000) 1,391 share Cost (£'000) 301 Retained profit (£'000) 730 Valuation (£'000) 350 Net Assets (£'000) 2,163 Systems Consultants Services (SCS) provides independent consultancy support which combines technical expertise with practical experience and domain knowledge, primarily but not exclusively to the defence sector. Initially focusing on operational and non-operational strategy and projects, especially in the Land Systems area, the company has expanded into a range of complementary business areas. The company has an impressive client base that includes the MOD and its agencies, NATO, and major defence contractors such as BAE, EDS, General Dynamics and Lockheed Martin. 10. Neutrahealth PLC Investment date August 2005 Audited figures for year to December 2005 Equity held 2.26% Turnover (£'000) 2,419 Purchase price per 10.5p Profit before tax (£'000) 363 share Cost (£'000) 315 Retained profit (£'000) 250 Valuation (£'000) 345 Net Assets (£'000) 13,275 Neutrahealth was formed in November 2004 as a cash shell to acquire SMEs in the growing nutraceutical industry and thereby build a group focused on the production and distribution of VMS (vitamins and mineral supplements) and probiotic products through retail and other distribution channels. Neutrahealth acquired BioCare in August 2005 for £16.1m and then Nutrigold for £0.8m in February 2006. 23 May 2006 For further information please contact: Roddi Vaughan-Thomas Head of Corporate Communications Keydata Investment Services 020 7710 6923 Craig McNeil Company Secretary Keydata AIM VCT plc 0141 572 2300 This information is provided by RNS The company news service from the London Stock Exchange

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