Final Results

T&G AIM VCT PLC 29 April 2005 T&G AIM VCT plc 29 April 2005 Audited Results - Year Ended 31 December 2004 FINANCIAL HIGHLIGHTS * NAV 87.0p (2003: 97.0p) per Ordinary share and 94.0p (2003: 95.3p) per C share. * 12 new qualifying investments made during the year by the Ordinary and C shares. * Ordinary share net assets now invested in qualifying holdings amounted to 79%. * C share net assets invested in qualifying holdings were 61% at 31 December 2004, 68% at 31 March 2005, and are expected to meet the 70% deadline by 31 December 2005. Ordinary Share Year ended Year ended 31 December 2004 31 December 2003 Total return per share (9.9p) 0.1p Net asset value per share 87.0p 97.0p Net assets £2,484,777 £2,768,219 Share price (mid-market price) 77.5p 77.5p Amount invested in qualifying investments (cost) £2,121,115 £582,981 C Share Year ended Period ended 31 December 2004 31 December 2003* Total return per share (1.3p) 1.2p Net asset value per share 94.0p 95.3p Net assets £595,961 £554,547 Share price (mid-market price) 100.0p 100.0p Amount invested in qualifying investments (cost) £365,607 £26,959 * The C Shares were issued on 8 October 2003 INVESTMENT MANAGER'S REPORT Investment Outlook Smaller companies, especially AIM stocks, performed well in 2004 against a background of reasonable UK economic growth and modest but rising interest rates, although much of this performance was due to metals and oil stocks, most of which may struggle to do as well in 2005. The outlook for the whole UK stock market has looked positive indeed for the first few months of this year. The probable price earnings rating of the whole market at below 15 times looks attractive, along with a prospective dividend yield of 3.2% against an interest rate scenario in the UK of below 5%. Smaller firms, especially in value sector areas, should benefit from modest economic growth in the UK in 2005 and from low interest rate levels, benefiting smaller groups with good management and with properly controlled gearing levels. Investments In the twelve months to 31st December 2004, the Ordinary shares and C shares made 12 new qualifying investments. These cost £1,563,000 and £344,000 respectively, and represent 74% and 94% respectively on a cost basis of the enlarged qualifying investment portfolio. At the year end, £2,121,000 of the Ordinary share funds had been invested in a total of 17 qualifying investments and £366,000 of the C share funds had been invested in 14 qualifying companies. Thus, at the year end, the proportion of the VCT's Ordinary share net assets now invested in qualifying holdings amounted to 79%, comfortably above the VCT rule that at least 70% by value of investments is represented by shares or securities consisting of qualifying holdings before the three-year deadline of 31st December 2004. The proportion of C share funds invested in qualifying holdings was 61% at the year-end. The C share funds will need to meet the 70% threshold referred to above by 31 December 2005. Investments in the new issues of Careforce Group (domestic care provision), Brady Group (commodities software), Jelf Group (increasingly a broker of private medical insurance), and TRL Electronics (surveillance and security software) performed very well. Micap, Immedia Broadcasting, Smart Approach, Capcon and Cytomyx have disappointed. Smallbone has held its own in a difficult retail sector. Investments since Year End In early 2005, investments have been made in Zenith Hygiene, a manufacturer and supplier of cleaning products to the leisure industry and Vicorp Limited, a vendor of telephony solutions to both carrier and corporate organisations. Net asset value Net asset value (NAV) per ordinary share at 31 December 2004 was 87p, (2003: 97p). This represents a decrease of 10 per cent, and was primarily due to disappointing results from Capcon Holdings plc and Micap plc. These losses were countered by the performance of the new investments made during the year mentioned above, as well as a recovery in some of the existing holdings, especially Monstermob. The NAV per C share at 31 December 2004 was 94p (2003: 95p). This decrease represents a positive performance from the new issues, a recovery in Monstermob Group plc but a poor performance by Cytomyx Holdings plc . Since the year-end, however, the NAV of the Ordinary Shares has risen to 92.4p and that of the C shares to 99.2p as at 31 March 2005. CHAIRMAN'S STATEMENT Introduction I am pleased to present my annual statement to shareholders for the full year ended 31 December 2004. Market sentiment has continued to improve since I last reported to you, the FTSE All-Share Index having risen 8% in the 6 months ended 31 December 2004 and the FTSE SmallCap and FTSE AIM indices also having risen 7% and 13% respectively over the same period. Portfolio Activity During the period under review your Investment Manager, Teather & Greenwood, has maintained a selective approach with regard to building up the qualifying investment portfolios. 12 new qualifying investments were added to both the Ordinary and C share portfolios. These new investments are described in the Investment Manager's review. At the year end, the Ordinary Share qualifying portfolio comprised 17 investments at a total cost of £2,121,000 (2003: £583,000) and the C share qualifying portfolio comprised 14 investments at a total cost of £366,000 (2003: £27,000). Both the Ordinary share and the C share qualifying portfolios are now well diversified across industry sectors. The VCT rule that at least 70% by value of investments is represented by shares or securities consisting of qualifying holdings has been met by the Ordinary shares and will be comfortably met by the C shares by the deadline of 31 December 2005. Approximately 22% (£544,000) of the Ordinary share net assets and 40% (£240,000) of the C share net assets by value were held in cash and listed fixed interest investments as at 31 December 2004. Results and Dividend At 31 December 2004 the net asset value per Ordinary share was 87.0p and 94.0p per C share compared with 97.0p and 95.3p respectively at the end of 2003. This is a relatively disappointing performance compared with the performance of the FTSE AIM index over the same 12-month period of 20%. Since the year end, the net asset values of the Ordinary and C shares have improved as at 31 March 2005 to 92.4p and 99.2p respectively. Revenue generation for the Ordinary shares in the period was £81,000 (2003: £119,000) and for the C shares was £15,000 (2003: £9,000). Net loss after taxation on Ordinary shares was £283,000 (2003: profit £4,000) and on C shares was £8,000 (2003: profit £5,000). The Company's respective revenue accounts show a debit of £14,000 (2003: £11,000) and a debit of £2,000 (2003: credit of £5,000), therefore your Board is unable to recommend that a dividend be paid. Share price The Company's closing mid-market price on 31 December 2004 was 77.5p (2003: 77.5p) and 100p (2003: 100p) for the Ordinary and C shares respectively. This represented a discount of 11% and a premium of 6% against their respective net asset values. In common with other VCTs, there is limited secondary trading activity in the shares of the Company. Management Arrangements The Board is aware that Teather & Greenwood no longer regards its investment management activities as core to its business. To rectify this situation, the Board has entered into discussions with other fund management groups with a view to securing the services of an alternative Investment Manager and Administrator either by simply making a new appointment in place of Teather & Greenwood, or by a merger with another VCT under the new VCT Merger Regulations. I am now able to announce that we have agreed in principle the appointment of Noble Fund Managers Limited ('NFM') as Investment Manager and Noble Partnership Limited (' NPL') as Administrator, in both cases conditional upon shareholder approval at the Extraordinary General Meeting to be held on 21 June 2005 (the 'EGM'). NFM and NPL are companies within the Noble Group, who are one of the leading VCT fund managers and promoters and who intend to re-brand your Company as Noble Income & Growth VCT plc and raise substantial further funds for investment. The terms which we have negotiated with NFM provide NFM with an incentive to fulfil this intention and will also maintain the Company's cost ratios within acceptable levels, despite the loss of the 'cost cap' arrangement with Teather & Greenwood, which has agreed to waive its notice period without payment upon these appointments taking effect. NFM also acts as Investment Advisor for Enterprise VCT plc, which has been managed since September 2001 by a team led by Charles McMicking and has established an excellent track record during this period. NFM has proposed to the Board that the investment policy of the Company should be broadened to include unquoted investments as well as AIM quoted securities within the overall framework of providing expansion capital to well managed, growing companies. This would align our investment policy broadly with that of Enterprise VCT plc and thereby enable the Company to take maximum advantage from NFM's existing deal flow by investing alongside Enterprise VCT plc. The Board believes this change in investment policy to be in shareholders' best interests but as it represents a change in investment policy from that described in the Company's prospectuses, it is appropriate that this and other changes should be approved by shareholders at the EGM. Accordingly, a separate circular containing the EGM notice with a separate proxy card will be sent to shareholders at the same time as the audited financial statements of the Company. In considering the future of your Company, the Board has investigated a number of alternatives; we believe that the proposed arrangement with NFM and NPL is in your best interests. We therefore recommend that you vote in favour of these changes at the EGM. AEB Wiegman Chairman 29 April 2005 Statement of Total Return (incorporating the revenue account) for the year ended 31 December 2004 Ordinary Shares C Shares Total 31 December 2004 31 December 2004 31 December 2004 Notes Revenue Capital Total Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Loss on investments - (276) (276) - (1) (1) - (277) (277) Investment income 81 - 81 15 - 15 96 - 96 Investment management fees (2) (4) (6) (1) - (1) (3) (4) (7) Other expenses (82) - (82) (21) - (21) (103) - (103) Loss on ordinary activities before (3) (280) (283) (7) (1) (8) (10) (281) (291) tax Tax on ordinary activities - - - - - - - - - Loss on ordinary activities after (3) (280) (283) (7) (1) (8) (10) (281) (291) tax Dividends proposed - - - - - - - - - Transfer from reserves (3) (280) (283) (7) (1) (8) (10) (281) (291) Loss per share (pence) 3/4 (0.1) (9.8) (9.9) (1.1) (0.2) (1.3) (0.3) (8.1) (8.4) All revenue and capital items in the above statement derive from continuing operations. The revenue column of this statement is the profit and loss account of the Company. The Company has only one class of business and derives its income from investments made in shares and securities and from bank deposits. No operations were acquired or discontinued in the year. Ordinary Shares C Shares * Total 31 December 2003 31 December 2003 31 December 2003 Notes Revenue Capital Total Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 (Loss)/Gain on - (15) (15) - 1 1 - (14) (14) investments Investment income 119 - 119 9 - 9 128 - 128 Investment management (1) (2) (3) - (1) (1) (1) (3) (4) fees Other expenses (97) - (97) (4) - (4) (101) - (101) Return/(Loss) on 21 (17) 4 5 - 5 26 (17) 9 ordinary activities before tax Tax on ordinary - - - - - - - - - activities Return/(Loss) on 21 (17) 4 5 - 5 26 (17) 9 ordinary activities after tax Dividends proposed - - - - - - - - - Transfer to/(from) 21 (17) 4 5 - 5 26 (17) 9 reserves Return/(Loss) per share 3/4 0.7 (0.6) 0.1 1.1 0.1 1.2 0.8 (0.5) 0.3 (pence) * The C Shares were issued on 8 October 2003. All revenue and capital items in the above statement derive from continuing operations. The revenue column of this statement is the profit and loss account of the Company. The Company has only one class of business and derives its income from investments made in shares and securities and from bank deposits. No operations were acquired or discontinued in the year. Balance Sheet As at 31 December 2004 Ordinary C Shares Total Ordinary C Shares Total Shares Shares 31 December 31 December 31 December 31 December 31 December 31 December Notes 2004 2004 2004 2003 2003 2003 £'000 £'000 £'000 £'000 £'000 £'000 Fixed assets Investments 2,430 363 2,793 2,325 28 2,353 Current assets Debtors 11 2 13 20 20 40 Cash at bank 71 240 311 462 511 973 82 242 324 482 531 1,013 Creditors: amounts falling due 27 9 36 39 4 43 within one year Net current assets 55 233 288 443 527 970 Total assets less current 2,485 596 3,081 2,768 555 3,323 liabilities Capital and reserves Called up equity share capital 29 6 35 29 6 35 Share premium - 49 49 - - - Capital redemption reserve* - - - - - - Special distributable reserve 2,685 544 3,229 2,685 544 3,229 Realised capital reserve (45) 1 (44) (4) (1) (5) Unrealised capital reserve (170) (2) (172) 69 1 70 Revenue reserve (14) (2) (16) (11) 5 (6) Total equity shareholders' 2,485 596 3,081 2,768 555 3,323 funds Net asset value per ordinary 87.0p 94.0p 88.3p 97.0p 95.3p 96.7p share * The capital redemption reserve has a credit of £90 as a result of the redemption of 9,000 ordinary shares during 2003. A.E.B. Wiegman Chairman 29th April 2005 T&G AIM VCT PLC Cash Flow Statement for the year ended 31 December 2004 Ordinary C Shares Total Ordinary Shares C Shares* Total Shares 31 December 31 December 31 December 31 December 31 December 31 December 2004 2004 2004 2003 2003 2003 Notes £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Operating activities Investment income 79 2 81 94 - 94 received Deposit interest 4 13 17 22 8 30 received Investment (6) (1) (7) 32 - 32 management fees refunded/(paid) Other cash payments (81) (18) (99) (126) (3) (129) Net cash inflow/ (4) (4) (8) 22 5 27 (outflow) from operating activities Financial investment Purchase of (1,562) (344) (1,906) (1,050) (27) (1,077) investments Sale of investments 1,182 7 1,189 - - - Net cash outflow (380) (337) (717) (1,050) (27) (1,077) from investing activities Net cash outflow (384) (341) (725) (1,028) (22) (1,050) before financing Financing Repurchase of (7) - (7) - - - ordinary shares Issue of ordinary - 71 71 - 565 565 shares Expenses on the (32) (32) issue of ordinary - (1) (1) - shares Net cash (outflow)/ (7) 70 63 - 533 533 inflow from financing (Decrease)/Increase (391) (271) (662) (1,028) 511 (517) in cash and cash equivalents * The C Shares were issued on 8 October 2003. Notes: 1. The financial information included in this announcement as regards the company does not constitute statutory accounts for the ended 31 December 2004 within the meaning of Section 240 of the Companies Act 1985. Statutory accounts of the Company for the financial year ended 31 December 2004, upon which the auditors of the Company have given an unqualified report, will be delivered to the Registrar of the Companies. 2. Copies of the Audited Financial Statements will be sent to shareholders and the UK Listing Authority. 3. Revenue loss per Ordinary share is based on the net loss on ordinary activities after taxation of £3,000 (2003: return £21,000) in respect of 2,854,979 Ordinary shares (2003: 2,863,609) being the weighted average number of Ordinary shares in issue during the year. Capital loss per Ordinary share is based on net capital loss for the financial year of £280,000 (2003 loss: £17,000) in respect of 2,854,979 shares (2003: 2,863,609), being the weighted average number of shares in issue during the year. 4. Revenue loss per C share is based on the net loss on ordinary activities after taxation of £7,000 (2003: Revenue £5,000) in respect of 623,845 C shares (2003:420,965) being the weighted average number of C shares in issue during the year. Capital loss per C share is based on net capital loss for the year of £1,000 (2003: nil) in respect of 623,845 shares (2003: 420,965), being the weighted average number of shares in issue during the year. Teather & Greenwood Limited Company Secretary Registered Office: Beaufort House 15 St Botolph Street London EC3A 7QR Date 29th April 2005 This information is provided by RNS The company news service from the London Stock Exchange

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