Information  X 
Enter a valid email address

Mobeus Inc&Gwth 4 (MIG4)

  Print          Annual reports

Thursday 07 April, 2022

Mobeus Inc&Gwth 4

Annual Financial Report

RNS Number : 5584H
Mobeus Income & Growth 4 VCT PLC
07 April 2022
 

MOBEUS INCOME & GROWTH 4 VCT PLC

LEI:  213800IFNJ65R8AQW943

 

 

ANNUAL FINANCIAL RESULTS OF THE COMPANY

FOR THE YEAR ENDED 31 DECEMBER 2021

 

Mobeus Income & Growth 4 VCT plc (the "Company") announces the final results for the year ended 31 December 2021.  These results were approved by the Board of Directors on 6 April 2022.

 

You may, in due course, view the Annual Report & Financial Statements, comprising the statutory accounts of the Company by visiting www.mig4vct.co.uk.

 

 

FINANCIAL HIGHLIGHTS

 

As at 31 December 2021:

Net assets: £92.79 million

Net asset value ("NAV") per share: 111.27 pence

 

  Net asset value ("NAV") total return1 per share of 42.7%.

 

  Share price total return1 per share of 50.4%.

 

  Dividends paid and declared in respect of the year totalled 9.00 pence per share. Cumulative dividends paid1 to date stand at 143.20 pence per share.

 

  £6.23 million was invested into four new growth capital investments and nine existing portfolio companies during the year.

 

  Strong portfolio performance generated £25.71 million of unrealised gains in the year.

 

  The Company realised investments totalling £12.23 million of cash proceeds and generated net realised gains in the year of £4.19 million.

 

 

PERFORMANCE SUMMARY

 

Cumulative Total return1 per share (NAV basis)

 

The longer term trend of performance on this measure is shown in the table below:-

 

R eporting date a s  at

NA V

(pence per share)

Cumulative dividends

paid1  to date

(pence per share)

Cumulative  total return1

to Shareholders (NAV Basis)

(pence per share)

31 December 2021

111.272

139.202

250.47

31 December 2020

81.50

134.20

215.70

31 December 2019

74.90

124.20

199.10

31 December 2018

84.79

105.20

189.99

31 December 2017

86.57

101.20

187.77

1 -  Definitions of key terms and alternative performance measures shown above and throughout this report are shown in the Glossary of terms within the Annual Report.

2 -  These figures exclude the impact of a dividend of 4.00 pence per share paid after the year-end on 7 January 2022. Payment of this dividend will reduce the Company's NAV per share and increase cumulative dividends paid to date by 4.00 pence per share.

 

The chart above shows the recent past performance of the original funds raised in 1999. The original subscription price was 200 pence per share before the benefit of income tax relief. Subscription prices from subsequent fundraisings and historic performance data from 2008 are shown in the Investor Performance Appendix on the Company's website, www.mig4vct.co.uk, where they can be downloaded by clicking on "table" under "Reviewing the performance of your investment" on the home page.

 

On 1 July 2006, Mobeus Equity Partners LLP became sole Investment Adviser to the Company. The Investment Adviser novated to Gresham House on 1 October 2021. The cumulative total return per share (NAV basis) at this date was 122.51 pence.

 

CHAIRMAN'S STATEMENT

 

Change in Management Arrangements

Following the communication to all Shareholders sent by the Chairmen of each of the VCTs advised by Mobeus Equity Partners LLP ("Mobeus") on 10 September 2021, I am pleased to report the sale of the Mobeus VCT fund and investment management business to a subsidiary of Gresham House plc completed with effect from 30 September 2021. As a result, the Mobeus-advised VCTs' investment advisory arrangements have been novated from Mobeus to Gresham House Asset Management Limited ("Gresham House").

 

The Board believes that the agreement to the novation of the investment advisory arrangements was in the interests of the Mobeus VCTs' Shareholders and the Company will benefit from scale advantages, continuity, portfolio diversification and investment in capability at Gresham House.

 

Clive Austin and Trevor Hope, the two leading partners involved with managing the Mobeus VCTs' investment portfolios, remain responsible for the investment, portfolio, and fund management of the Mobeus VCTs, alongside the investment and operations teams.

 

 

I am pleased to present the Annual Report of Mobeus Income & Growth 4 VCT plc for the year ended 31 December 2021.

 

Overview

At the time of the previous Annual Report, I was able to report on the Company's robust performance over a period of material global uncertainty and market volatility.

 

Twelve months later, I am pleased to say that it has been a year of continued strong trading and portfolio value growth to 31 December 2021. The Company achieved an exceptional NAV total return per share of 42.7% for the year (2020: 22.2%).

 

Although the period under review was marked by many challenges, the portfolio proved to be resilient and adaptive in facing them. The threat from global supply issues in logistics, materials and labour resulting from COVID-19 disruption is expected to remain for some months, and the unfolding geopolitical events relating to the war in Ukraine adds to the uncertainty. However, for the most part, trading for your Company's largely service and software-based portfolio has not been significantly impacted to date.

 

Despite Brexit concerns and considerable COVID-19 related restrictions across the year, M&A activity has remained buoyant and the Investment Adviser continues to see a healthy deal flow. The Company deployed £6.23 million of investment capital and generated £12.23 million in realisation proceeds from investment activity during the year. In that time, it added four new investments to its portfolio, provided follow-on funding into nine existing portfolio companies and supported the admission to AIM of a further two of its investments.

 

Shareholders should note that the portfolio now features some value concentration in two of its stocks: Virgin Wines and Preservica (10.2% and 11.9% of net assets respectively as at 31 December 2021), the former of which is listed on AIM. With this additional AIM exposure, there is the natural potential for a higher level of volatility in the value of the Company's portfolio and subsequent NAV returns. Following an initial uplift in value following two IPOs in March 2021, the value of the quoted assets has been volatile over the rest of the year as the companies were impacted by unfavourable trading announcements and negative market sentiment. The remainder of the portfolio largely demonstrated strong performance and growth over the same period.

 

We are witnessing a clear demonstration of the benefits of what is now a diverse and maturing portfolio. Following the 2015 VCT rule change, the revised investment strategy is now bearing fruit as more of these young growth investments are starting to achieve significant scale and value. This view has been validated by third-party investment transactions which have brought significant upratings in values of portfolio businesses, such as MPB, MyTutor and Bella & Duke, whilst the Company has also been able to provide support for the scaling of investments such as Preservica, to which the Company provided significant further funding in November 2021. For further information on value movements, see the Investment Adviser's Review below.

 

The Company launched an Offer for Subscription on 20 January 2022 alongside the three other Mobeus VCTs ("Offers") and the Board was very pleased to see that unprecedented demand meant that the target of £7.5 million was reached in less than 24 hours, at which point no further applications were accepted. It was gratifying that approximately half of the applications received were from existing Shareholders in the Company. The subsequent allotment of shares has now bolstered the Company's capital to deploy in new and exciting investment opportunities.

 

Performance

The Company's NAV total return per share was 42.7% for the year to 31 December 2021 (2020: 22.2%) being the closing NAV per share of 111.27 pence plus 5.00 pence of dividends paid in the year, divided by the opening NAV per share of 81.50 pence. The share price total return was 50.4% (2020: 12.9%). The difference between the share price and NAV total returns arises principally due to the timing of NAV announcements which are usually made on a date following the date to which they relate and is explained more fully under Performance in the Strategic Report within the Annual Report. The positive NAV total return for the year was principally the result of significant unrealised gains in the value of investments still held, as well as realised gains achieved via exits and partial realisations of several portfolio companies.

 

At the year-end, the Company was ranked 6th out of 38 Generalist VCTs over five years and 8th out of 31 Generalist VCTs over ten years, in the Association of Investment Companies' analysis of NAV Cumulative Total Return. Shareholders should note that the AIC's rankings are based on the latest available published NAVs and therefore do not reflect the NAV per share increase achieved by the Company up to 31 December 2021. For further details on the performance of the Company, please refer to the Strategic Report within the Annual Report.

 

Dividends

The Board continues to be committed to providing an attractive dividend stream to Shareholders and is pleased to have announced a second interim dividend of 4.00 pence per share, which was paid on 7 January 2022 to Shareholders on the register on 10 December 2021.

 

This second interim dividend, together with a first interim dividend of 5.00 pence per share paid on 6 August 2021 to Shareholders on the register on 9 July 2021, brings dividends paid and proposed in respect of the financial year ended 31 December 2021 to 9.00 pence per share. To date, cumulative dividends paid since inception total 143.20 pence per share.

 

The Company has now met or exceeded the Board's dividend target of paying at least 4.00 pence per share in respect of each financial year over the last twelve years.

 

As Shareholders have been advised previously, the gradual move of the portfolio to younger growth capital investments as well as the realisations of older, more mature companies that have provided a good income yield, are likely to make dividends harder to achieve from income and capital returns alone in any given year. The Board aims to distribute realised profits (such as income and gains from realisations) achieved in a year as dividends but notes that a reduction in income received by the Company was seen during the year. The Board, therefore, continues to monitor the sustainability of the annual dividend target. Shareholders should also note that there may continue to be circumstances where the Company is required to pay dividends in order to maintain its regulatory status as a VCT, for example, to stay above the minimum percentage of assets required to be held in qualifying investments. Such dividends paid in excess of net income and capital gains achieved will cause the Company's NAV per share to reduce by a corresponding amount.

 

Dividend Investment Scheme

The Company's Dividend Investment Scheme ("DIS") provides Shareholders with the opportunity to reinvest their cash dividends into new shares in the Company at the latest published NAV per share. New VCT shares attract the same tax reliefs as shares purchased through an Offer for Subscription. As part of the 5.00 pence per share dividend paid on 6 August 2021, 695,052 Ordinary shares were allotted to participants of the DIS at a price of 92.24 pence per share. For the further 4.00 pence per share dividend declared for the year and paid after the year-end on 7 January 2022, 508,732 Ordinary shares were allotted at a price of 99.57 pence per share to DIS participants.

 

Shareholders wishing to take advantage of the scheme for any future dividends can join the DIS by completing a mandate form available on the Company's website, under the 'Dividends' heading, at: www.mig4vct.co.uk., or alternatively, Shareholders can opt-out by contacting Link Group, using their details provided under Corporate Information within the Annual Report.

 

Investment portfolio

The portfolio movements across the year were as follows:

 


2021

£m

2020

£m

Openingportfoliovalue

41.68

38.54

Newandfurtherinvestments

6.23

4.80

Disposalproceeds

(12.23)

(14.97)

Netrealisedgains

4.19

4.44

Valuation movements

25.71

8.87

Portfolio valueat31December

65.58

41. 68

 

During the year, the Company invested a total of £6.23 million into four new and nine existing portfolio companies (2020: £4.80 million; four new, four existing).

 

New investments totalling £2.53 million were made into Vivacity Labs (an artificial intelligence and Urban Traffic Control ("UTC") system), Caledonian Leisure (a provider of UK experience and leisure breaks), Legatics (a SaaS LegalTech software business) and Vet's Klinic (a veterinary clinic roll out).

 

Additional funding of £3.70 million was provided across nine existing portfolio companies, including Parsley Box (an ambient meals provider), Bleach London (hair colourants brand), Arkk Consulting (a financial reporting service provider), Bella & Duke (a frozen raw dog food provider), Tapas Revolution (a Spanish restaurant chain), MyTutor (an online tutoring marketplace), Andersen EV (a producer of premium EV chargers), Active Navigation (a provider of enterprise-level file analysis software) and Preservica (a proprietary digital archiving software provider).

 

The Company generated £6.02 million in proceeds from the realisation of its investments in Proactive Group, Vian Marketing Limited (trading as Red Paddle) and Omega Diagnostics during the year. In addition to £3.21 million of proceeds received from the partial realisations of Virgin Wines and Parsley Box (upon the admission of their shares to AIM as mentioned previously), the partial realisations of MPB Group and MyTutor, together with loan repayments and other capital receipts of £3.00 million, the Company generated total proceeds of £12.23 million in the year to 31 December 2021.

 

The portfolio has performed very strongly over the Company's financial year. The overall value increased by £29.90 million (2020: £13.31 million), or 71.8% (2020: 34.5%) on a like-for-like basis, compared to the start of the year. This increase comprised a net unrealised uplift in portfolio valuations of £25.71 million and £4.19 million in net realised gains over the year. The portfolio was valued at £65.58 million at the year-end (2020: £41.68 million).

 

Within net realised gains, the principal contributors were the full realised gains of Proactive Group and Red Paddle (total of £2.48 million). Total proceeds received over the life of investments in Proactive Group (£1.94 million) and Red Paddle (£4.84 million) generated multiples of cost of 2.6x (IRR: 33.0%) and 5.4x (33.2%) respectively (including £0.40 million received in deferred proceeds from Red Paddle after the year-end. Further realised gains were also generated from the partial realisations of Parsley Box (£0.54 million), MPB Group (£0.41 million) and MyTutor (£0.38 million).

 

The portfolio's valuation at the year-end reflects the continued beneficial impact of changes in UK consumer and business behaviour brought on by the pandemic and lockdown restrictions, particularly for those businesses operating direct-to-consumer models. This also underscores the success of portfolio companies in adapting to a rapidly changing environment, becoming more efficient and diversifying their product offering in order to take advantage of opportunities that have arisen.

 

Since the year-end, in February 2022, the Company made a new investment into Proximity Insight, a retail software provider. This is the first investment made since the acquisition of the Mobeus VCT investment advisory business by Gresham House and the Company's investment was made alongside the other VCTs advised and managed by Gresham House (the three other Mobeus VCTs and the two Baronsmead VCTs). In accordance, with the agreed allocation policy, the Company contributed £0.61 million towards a total Gresham House supported investment of £5.00 million.

 

The flotation of both Virgin Wines and Parsley Box on the AIM market in March 2021 resulted in significant uplifts in valuation, as well as generating an element of realised returns. As part of the Virgin Wines transaction, the Company received repayment of its remaining loan stock, leaving Virgin Wines ungeared and, as part of the IPO of Parsley Box, the Company realised part of its equity holding, securing a 4.0x return on the cost of the shares sold. As was expected, these quoted stocks are subject to stock market movements and have brought an additional level of volatility to a portion of the portfolio. In the second half of the year, Parsley Box in particular saw a subsequent value decline in the face of changing market sentiment and an announcement of results which were below market expectations. Virgin Wines has experienced similar volatility, but had returned to its float price at the year-end. Your Board remains confident in the future prospects of both these AIM quoted businesses.

 

In contrast, there have been substantial unquoted valuation increases, supported by a sizeable further investment from the Mobeus VCTs in the case of Preservica, and by third-party investment transactions in the cases of MyTutor, MPB and Bella & Duke.

 

The portfolio achieved a net increase in unrealised valuations of £25.71 million for the year in investments still held, with the biggest value increases in Preservica, Virgin Wines and Media Business Insight partially offset by modest valuation falls at Parsley Box, Andersen EV and Bleach London. For further information on portfolio valuation movements, see the Investment Adviser's Review below.

 

Although a minority of portfolio companies have been disadvantaged by the COVID-19 pandemic, principally as a result of staff shortages, closure of retail sites and interrupted supplies, these factors have not affected any of the businesses within the portfolio's top ten investments by value. Many of those that were negatively affected have also since seen value uplifts.

 

Further details of the Company's investment activity and the performance of the portfolio are contained in the Investment Adviser's Review and the Investment Portfolio Summary on below.

 

Liquidity & Fundraising

Cash and cash equivalents held by the Company as at 31 December 2021 amounted to £24.53 million, or 26.4% of net assets.

 

On 20 January 2022, the Company launched an offer for subscription of £7.50 million, alongside Offers from the other Gresham House-advised VCTs. As previously stated in my Overview above, the Offers experienced unprecedented demand such that the Company received subscriptions amounting to the full amount sought within 24 hours of launching and were then unable to take any further applications from the middle of 21 January 2022. In accordance with the Offers' prospectus, the allotment of all shares under the offer took place on 9 March 2022 - with cleared monies, and generated net funds (after costs) of £7.27 million. In consideration of the environmental factors and cost savings, the Company elected to release the Prospectus digitally, with hard copies available on request, and invite applications to be submitted online via a digital portal. This method provided increased security and efficiency in the application process and the Board strongly recommends that Shareholders wishing to subscribe to any future offers opt to submit their applications via the online facility.

 

Share Buybacks

During the year, the Company bought back and cancelled 1,309,349 of its own shares (2020: 1,245,646), representing 1.6% of the shares in issue at the beginning of the year (2020: 1.9%), at a total cost of £1.23 million, inclusive of expenses (2020: £0.73 million). It is the Company's policy to cancel all shares bought back in this way. The Board regularly reviews its buyback policy and currently seeks to maintain the discount at which the Company's shares trade at no more than 5% below the latest published NAV.

 

Shareholder Communications & Annual General Meeting

May I remind you that the Company has its own website which is available at: www.mig4vct.co.uk .

 

The Investment Adviser held a virtual Shareholder Event on the morning of 25 February 2022. A presentation was provided by representatives of each of the Mobeus VCT Boards as well as the Investment Adviser and the key executives of two portfolio companies, Virgin Wines and Media Business Insight. A recording of the event is available here:  https://mvcts.connectid.cloud/

 

Your Board is pleased to be able to hold the next Annual General Meeting ("AGM") of the Company in person at 11.30 am on Tuesday, 17 May 2022 at the offices of Shakespeare Martineau, 6th Floor, 60 Gracechurch Street, London, EC3V 0HR. A webcast will also be available at the same time for those Shareholders who cannot attend in person. However, please note that you will not be able to vote via this method and so are encouraged to return your proxy form before the deadline of 11:30 am on 13 May 2022. Information setting out how to join the meeting by virtual means will be shown on the Company's website. For further details, please see the Notice of the Meeting which can be found at the end of the Annual Report & Financial Statements.

 

Board Composition

On 6 December 2021, the Company announced Helen Sinclair's retirement as a Non-Executive Director of the Company, on 28 February 2022. The Board would like to thank Helen for her significant contribution and dedication during her directorship, particularly in her role as Chair of the Investment Committee and wish her well for the future. The Board, comprised four directors prior to Helen's retirement and careful consideration was given to ensuring that the Board was well positioned to continue to fulfill its role in the direction of the Company following her retirement. On 1 March 2022, Chris Burke was appointed a member of both the Audit Committee and the Nomination and Remuneration Committee. He was appointed Chair of the Investment Committee on the same date. After considering and reviewing its composition, the Board agreed that the remaining directors have the breadth and depth of relevant knowledge and experience plus the appropriate skill sets such that the recruitment of another Non-Executive Director is not necessary at the present time. However, the directors are committed to increasing diversity of representation and, when any further appointment to the Board is considered, will take this fully into account alongside the skills required to serve shareholders well in the specialist VCT sector.

 

Fraud Warning

We have been made aware of a number of Shareholders being contacted in connection with sophisticated but fraudulent financial scams which purport to come from the Company or to be authorised by it. This is often by a phone call or an email usually originating from outside of the UK, claiming or appearing to be from a corporate finance firm offering to buy your shares at an inflated price.

 

The Board strongly recommends Shareholders take time to read the Company's Fraud warning section, including details of who to contact, contained within the Information for Shareholders section at the end of the Annual Report.

 

Environmental, Social and Governance ("ESG")

The Board and the Investment Adviser believe that the consideration of environmental, social and corporate governance ("ESG") factors throughout the investment cycle will contribute towards enhanced Shareholder value.

 

Following the novation of the investment advisory agreement to Gresham House, who have a dedicated team which is focused on sustainability, the Board views this as an opportunity to enhance the Company's existing protocols and procedures through the adoption of the highest industry standards. Under the new enlarged investment team, each investment executive is responsible for their own individual ESG objectives in support of the wider overarching ESG goals of the Investment Adviser.  For further details, Gresham House published its inaugural Sustainable Investment Report in 2021, which can be found on its website at: www.greshamhouse.com.

 

Your Board would like to assure Shareholders that ESG matters form a key consideration in investment decisions. The FCA reporting requirements consistent with the Task Force on Climate-related Financial Disclosures commencing from 1 January 2021 do not currently apply to the Company but will be kept under review, the Board being mindful of any recommended changes.

 

 

Outlook

The year under review can be characterised as a continuation of the trying environment created for businesses in light of the COVID-19 pandemic and Brexit in 2020. However, much in the same way that we were able to report on its remarkable recovery one year ago, the Company has continued to achieve success in creating opportunities and building on them. This has been exemplified by strong trading performances and value growth across the portfolio and in exceeding expectations for the level of investment activity.

 

Whilst the immediate threat of further lockdowns from new variants of the virus appears to have lessened to some extent as we move into 2022, we anticipate that the indirect effects of the COVID-19 pandemic and Brexit will continue to impact the UK economy and bring an element of uncertainty for some time to come, most notably in the form of supply chain and inflationary pressures. More recently, the distressing invasion of Ukraine has sent shockwaves through global financial markets. Whilst the portfolio has limited direct exposure to Eastern Europe, Russia's action has introduced a disruptive factor the impact of which cannot yet be fully measured. Nonetheless, your Board considers that your Company is well positioned to adapt as necessary.

 

The Board was very pleased to have witnessed such a positive response to the launch of the Company's Offer for subscription in January and would like to thank all Shareholders for their interest in applying for the Company's shares. The Board has been satisfied with the Company's ability to maintain a high rate of investment in quality opportunities over the year. It believes that the additional fundraising will provide the necessary capital to continue to create value growth for Shareholders in what has, to date, proven to be a successful investment strategy.

 

I would like to take this opportunity once again to thank all Shareholders for your continued support and to extend a warm welcome to new Shareholders.

 

Jonathan Cartwright

Chairman

6 April 2022

 

 

 

INVESTMENT POLICY

The Company's policy is designed to meet the Company's Objective:

 

Investments

The Company invests primarily in a diverse portfolio of UK unquoted companies. Investments are made selectively across a number of sectors, principally in established companies. Investments are usually structured as part loan stock and part equity in order to produce a regular income stream and to generate capital gains from realisations.

 

There are a number of conditions within the VCT legislation which need to be met by the Company and which may change from time to time. The Company will seek to make investments in accordance with the requirements of prevailing VCT legislation.

 

Asset allocation and risk diversification policies, including the size and type of investments the Company makes, are determined in part by the requirements of prevailing VCT legislation. No single investment may represent more than 15% (by VCT tax value) of the Company's total investments at the date of investment.

 

Liquidity

The Company's cash and liquid funds are held in a portfolio of readily realisable interest-bearing investments, deposit and current accounts, of varying maturities, subject to the overriding criterion that the risk of loss of capital be minimised.

 

Borrowing

The Company's Articles of Association permit borrowings of amounts up to 10% of the adjusted capital and reserves (as defined therein).

 

However, the Company has never borrowed and the Board would only consider doing so in exceptional circumstances.

 

 

INVESTMENT ADVISER'S REVIEW

 

 

Change in Management Arrangements

As Shareholders will be aware, Gresham House acquired the VCT investment advisory business of Mobeus and, as a result, the entire investment and operations teams of Mobeus joined Gresham House on 1 October 2021.

 

At the time of writing, the integration has been well underway for over six months. Having formed one of the largest and most experienced teams in the VCT sector, the team recently completed its first combined investment into Proximity Insight, a retail software provider. It is hoped that this combined investment team will be a major force in the supply of capital to the VCT sector and the team's enhanced market position should attract strong deal flow in order to produce attractive investment returns.

 

Portfolio Review

Having recovered from the COVID-19 related decline in value by the start of the Company's financial year, the portfolio continues on a positive trajectory.

 

Whilst markets helped deliver a strong recovery in 2020, the main driver of value growth in 2021 has been a continuation of buoyant underlying trading performance across the portfolio. This has been bolstered by a small number of significant re-ratings during the year.

 

A limited number of portfolio companies have experienced disruption as a result of the UK lockdowns, but it is pleasing to report that a significant proportion have benefited from what appears to be a structural change in consumer purchasing habits. Indeed, the majority of the portfolio companies is now trading above their pre COVID-19 levels.

 

Overall, the majority of the portfolio has demonstrated a high degree of resilience, with the vast majority of companies by number showing revenue and/or earnings progression over the previous two years. Investments classified as Retailers now comprise over 44% of the portfolio by value, all of which are demonstrating the success of the direct-to-consumer business model.

 

Significant up-ratings in the unquoted portfolio have been a consistent feature across the year, with third-party investment driving value uplifts in MPB (£2.82 million), MyTutor (£2.16 million) and Bella & Duke (£0.95 million), and a sizeable further investment from the Mobeus VCTs doing the same in the case of Preservica (£6.20 million). Whilst the portfolio has limited exposure to more challenging sectors such as hospitality and overseas travel, software and other technology-enabled businesses have performed strongly. A small number of companies have struggled, though they are in the minority and their impact on overall shareholder return is minimal. Furthermore, some of these companies, such as Media Business Insight and RDL, have fundamentally re-engineered their businesses, which should provide a more positive outlook.

 

It is noted that Virgin Wines and Preservica currently account for a significant proportion of the invested portfolio's value (31.3% of the portfolio value, 22.1% of net assets), whilst 15.1% of the portfolio is now held in AIM-listed investments (which equates to 10.7% of net assets). The AIM market has witnessed some volatility in the final quarter of the Company's financial year, with market sentiment reducing the initial value uplifts of the IPOs of Virgin Wines and Parsley Box in March. Whilst Virgin Wines had recovered its value at the year-end, Parsley Box was further impacted by its announcements of tougher trading conditions, supply constraints and further fundraising. In line with market practice, in both cases the Company's shareholdings are subject to lock-up arrangements for a period post-flotation.

 

Strong trading activity levels have created investment opportunities for the Company as portfolio companies sought to enhance their positions by building capability in light of demand. A number of further investments were therefore made into the portfolio during the year. Gresham House continues to review the opportunities for follow-on investments. M&A sentiment also remained buoyant with a continuing stream of attractive realisations throughout the period. The outlook for both follow-on investment and realisations continues to be positive.

 

The Company made investments totalling £6.23 million (2020: £4.80 million), comprising £2.53 million into four new investments and £3.70 million into nine existing investments. This level of new and follow-on investment is pleasing given the continued uncertainty and lockdown restrictions during the year under review.

 

A strong track record for the growth investments is now emerging which validates the strategic change arising from the amendment to VCT rules in 2015. Overall, it is reassuring to see that the more traditional investments, as well as the new growth investments, are continuing to make good progress.

 

InvestmentPortfolio CapitalMovement

2021

£m

2020

£m

Increaseinthevalueof unrealisedinvestments

27.19

12.94

Decreaseinthe valueofunrealised investments

(1.48)

(4.07)

Netincreaseinthe valueofunrealised investments

25.71

8.87

Realised gains

4.26

4.52

Realised losses

(0.07)

(0 .08)

Netrealisedgainsintheyear

4.19

4.44

Net investment portfolio capital movement in the year

29.90

13.31

 

The portfolio movements in the year are summarised as follows:


2021

£m

2020

£m

Openingportfoliovalue

41.68

38.54

38.54

Newandfurtherinvestments

6.23

4.80

Disposalproceeds

(12.23)

(14.97)

Netrealisedgains

4.19

4.44

Valuation movements

25.71

8.87

Portfolio valueat31December

65.58

41. 68

 

 

 

New investments during the year

A total of £2.53 million was invested into four new investments during the year, as detailed below::

 

Company

Business

Date of Investment

Amount of new investment (£m)

Vivacity

Artificial intelligence & urban traffic control system

February 2021

0.91

Vivacity (vivacitylabs.com) develops camera sensors with on-board video analytics software that enables real-time anonymised data gathering of road transport system usage. It offers city transport authorities the ability to manage their road infrastructure more effectively, enabling more efficient monitoring of congestion and pollution levels as well as planning for other issues, such as the changing nature of road usage (e.g. the increasing number of cyclists). The technology and software represent a significant leap forward for local planning authorities which have traditionally relied upon manual data collection methods. The growth capital funding will allow the management team to achieve deeper penetration of the UK transport management sector, explore opportunities internationally and commercialise its new Smart Junction offering. Revenues have grown 350% over the last three years and it has exceeded its most recent year's budget despite the onset of the COVID-19 pandemic. In April 2021, Vivacity won the Queen's Award for Enterprise: Innovation 2021.

Caledonian Leisure

UK leisure and experience breaks

March-May 2021

0.33

Caledonian Leisure works with accommodation providers, coach businesses and other experienced providers (such as entertainment destinations and theme parks) to deliver UK-based leisure and experience breaks to its customers. It comprises two brands, Caledonian Travel (caledoniantravel.com) and UK Breakaways (ukbreakaways.com). The domestic leisure and experience travel market has been devastated by the COVID-19 pandemic, but the company is well-placed to expand as lockdown and travel restrictions are eased. A series of planned investment tranches, has helped the company prepare for and capitalise on the strong demand for UK staycation holidays.

Legatics

SaaS LegalTech software business

June 2021

0.66

Legatics (legatics.com) transforms legal transactions by enabling deal teams to collaborate and close deals in an interactive online environment. Designed by lawyers to improve legacy working methods and solve practical transactional issues, the legal transaction management platform increases collaboration, efficiency and transparency. As a result, Legatics has been used by around 1,500 companies, and has been procured by more than half of the top global banking and finance law firms, with collaborations having been hosted in approximately 50 countries. With this new funding round, Legatics will be looking to double the size of its team over the next 18 months and further develop its technology to deliver new features and use cases for a wider range of practice areas within new and existing customers.

Vet's Klinic

Veterinary clinics

June 2021

0.63

Pets' Kitchen (trading as Vet's Klinic) is an established and profitable veterinary clinic providing veterinary services  (vetsklinic.co.uk) as well as a premium pet food provider (vetskitchen.co.uk). Its primary Swindon 'super clinic' is a first opinion veterinary practice where pet owners can schedule consultations online and obtain real time feedback on in-patient care through its own technology platform. Without compromising on quality of care, this model enables a significantly higher price point compared to the industry average. This new investment will be used to roll out its unique clinic model to other sites along the M4 corridor.

 

Further investments during the year

A total of £3.70 million was invested into nine existing portfolio companies during the year, as detailed below:

Company

Business

Date of Investment

Amount of further investment (£m)

Parsley Box

Ambient ready meals targeting the over 60s

January/March 2021

0.27

Parsley Box (parsleybox.com) is a UK direct to consumer supplier of home delivered, ambient ready meals for the over 60s. Founded in 2017, Parsley Box has grown rapidly and has developed a unique meal delivery solution for its customers. The company supplies a diverse range of ambient meals via next day delivery which are easy to store and contribute to a more independent and healthier lifestyle. The company has seen a strong benefit from the COVID-19 pandemic with revenues nearly eight times that at the time of the original VCT investment. This further investment enabled the company to scale its marketing strategy, process larger order volumes and continue to build out its team. Parsley Box's shares were admitted to trading on AIM on 31 March 2021. As part of the transaction, the Company also partially realised a portion of its investment, as detailed in the "Loan stock repayments and other gains/(losses) during the year" section of this report below.

 

Bleach London

Hair colourants brand

February 2021

0.11

Bleach London Holdings ("Bleach") (bleachlondon.com) is an established branded, fast-growing business which manufactures a range of haircare and colouring products. Bleach has made sound commercial progress since the VCTs invested in 2019 with its direct-to-consumer channels benefiting from the COVID-19 pandemic. Revenues have grown over 90% ahead of the previous year. This further investment, along with strong support from existing investors, is being used to invest in marketing and infrastructure to enable the business to accelerate its development in the United States of America.

 

Arkk Consulting

Regulatory and reporting requirement service provider

 

February 2021

 

0.48

Arkk Consulting (trading as Arkk Solutions) (arkksolutions.com) provides services and software to enable organisations to remain compliant with regulatory reporting requirements. Arkk was established in 2009 and currently has over 800 clients across 20 countries. These include more than 80 of the FTSE 350, and half of the largest 20 accountancy firms in the UK. This further investment is to enable continued development of its software in order to capitalise on HMRC's 'Making Tax Digital' campaign. The company has incorporated artificial intelligence into its product and recurring revenues are now over 50% higher than at the point of the original investment in May 2019.

Bella & Duke

Frozen raw dog food provider

May 2021

0.26

Bella & Duke (bellaandduke.com) is a direct-to-consumer subscription service, providing premium frozen raw dog food to pet owners in the UK. Founded in 2016, the business provides an alternative to standard meal options for dog owners by focusing on the well documented health benefits of a raw food diet. This area is a growing niche in the large and established pet food market and is being driven by the premiumisation of dog food. This follow-on investment from the Company, alongside a co-investment by the British Growth Fund ("BGF") and existing shareholders, will provide additional working capital enabling Bella & Duke to continue to scale.

Tapas Revolution

Spanish restaurant chain

June 2021

0.17

Spanish Restaurant Group (trading as Tapas Revolution) (tapasrevolution.com) is a leading Spanish restaurant chain in the casual dining sector. At initial investment in January 2017, it was operating five sites and, subsequent to a further investment round in March 2018, had grown to 12 sites. Tapas was trading well and had a strong outlook up until the onset of COVID-19 which mandated the closure of much of its estate during the course of 2020 in response to the varying patterns of government restrictions. Costs were controlled well under the circumstances and this further investment provided financial headroom whilst the business re-opened its estate.

MyTutor

Digital marketplace for online tutoring

August 2021

0.70

MyTutorweb (trading as MyTutor) (mytutor.co.uk) is a digital marketplace that connects school pupils who are seeking private one-to-one tutoring with university students. The business is satisfying a growing demand from both schools and parents to improve pupils' exam results. This further investment, alongside other existing shareholders and Australian strategic co-investor, SEEK, who invested £30 million, aims to build and reinforce its position as a UK category leader in the online education market as well as to begin to develop a broader, personalised learning product. The company has been chosen as a Tutoring Partner for the National Tuition Programme where they will directly support 30,000 students in catching up on lost learning because of the COVID-19 pandemic.

Andersen EV

Provider of premium electric vehicle (EV) chargers

September 2021

0.15

Muller EV Limited (trading as Andersen EV) (andersen-ev.com) is a design-led manufacturer of premium EV chargers. Incorporated in 2016, this business has secured high profile partnerships with Porsche and Jaguar Land Rover, establishing an attractive niche position in charging points for the high-end EV market. This follow-on funding is to further support its premium brand and product positioning whilst ensuring all new and existing products meet the most recent and highest safety and compliance standards. Andersen has continued its strong trading performance with revenue up over 300% year on year.

Preservica

Seller of proprietary digital archiving software

October/ November 2021

1.25

Preservica (preservica.com) is a SaaS software business with blue chip customers and strong recurring revenues. It has developed market leading software for the long-term preservation of digital records, ensuring that digital content can remain accessible, irrespective of future changes in technology. This latest investment is to provide additional growth capital to finance the further development of the business. The business has seen annual recurring revenues nearly double over the last two financial years.

ActiveNav

A provider of enterprise-level file analysis software

December 2021

0.31

Data Discovery Solutions (trading as ActiveNav) (activenav.com) is a file analysis software solution which makes it easier for companies to clean up network drives, respond to new data protection laws and dispose of redundant and out dated documents. Active Navigation's solution is used by significant blue chip customers, particularly those in highly regulated industries such as energy and professional services, as well as government entities in the USA, Canada, Australia and the UK. This further funding is to market its nascent Hubble platform in order to generate company value.

Portfolio valuation movements

The portfolio generated net unrealised gains of £25.71 million in the year. The scale of the valuation increases was underpinned by the Company's growth portfolio, many of which have direct-to-consumer business models which have grown significantly since the onset of the COVID-19 pandemic. In the first half of the year, the Company generated significant unrealised gains, exemplified by the successful flotations of two investments on AIM. Despite ongoing uncertainties relating to COVID-19, Gresham House believes that the pandemic has accelerated existing trends in consumer behaviour and, in many cases, companies have experienced significant growth in demand. Over this period, some older style MBO portfolio companies with similar business practices have also benefited. A few companies have struggled in this environment, but their value has already been reduced to modest levels, reducing the risk to shareholder value.

Total valuation increases were £27.19 million. The main valuation increases were:

Preservica

£6.20 million

Virgin Wines

£5.06 million

Media Business Insight

£2.86 million

MPB Group

£2.82 million

EOTH (Equip)

£2.45 million

 

Virgin Wines, EOTH (Equip) and MPB Group generated record revenues and earnings over the lockdown periods and beyond. They have all significantly increased their customer base and each have strong growth prospects. Strong trading and recurring revenues at Preservica has attracted third-party investment interest which has led to a sizeable re-rating. MBI has recovered very strongly and has benefited from its ability in providing both virtual and physical events.

 

Total valuation decreases were £(1.48) million. The main valuation decreases were:

 

Parsley Box

£(1.09) million

Andersen EV

£(0.17) million

Bleach London

£(0.15) million

Kudos Innovations

£(0.07) million

The value of Parsley Box experienced a significant decline over the second half of 2021 in light of market sentiment compounded by company announcements of slower than anticipated sales growth and supply disruption. This business intends to carry out a further fundraising soon. Andersen EV has been operating in a fast-developing industry beset with regulatory hurdles that have challenged its progress over the period, albeit all of these are now resolved. Bleach London has had a difficult period, having had to delay its US launch and having experienced normalised direct-to-consumer revenues post-UK lockdown. The US launch took place after the Company's year-end. Kudos Innovations has been affected by contract delays.

 

The majority of the increase in portfolio value lies in the top 10 companies which represent over 70% of the portfolio by value. Year-on-year growth by either revenues or earnings has been seen in all of the top ten companies and it is pleasing to note that eight of these are from the younger, growth portfolio.

 

 

Portfolio Realisations

The Company realised three of its investments during the year, as detailed below:

Company

Business

Period of investment

Total cash proceeds over the life of the investment / Multiple over cost

Omega Diagnostics

In vitro diagnostics for food intolerance, auto-immune diseases and infectious diseases

December 2010 to

February 2021

£1.17 million

5.9 x cost

Following a further significant increase in the share price, the Company sold its remaining investment in Omega Diagnostics Group plc for £0.42 million (realised gain in the year: £0.16 million). Total proceeds received over the ten-year life of the investment were £1.17 million, compared to an original investment cost of £0.20 million, which is a multiple on cost of 5.9x and an IRR of 19.9%.

 

Proactive Group

Provider of media services and investor conferences

 

January 2018 to 

September 2021

£1.94 million

2.6 x cost

On 29 September 2021, the Company sold its investment in Proactive Group Holdings Inc ("Proactive"). The Company received £1.89 million in cash following the disposal of its equity and loan notes, contributing to a realised gain over cost over the life of the investment of £1.19 million (realised loss in the year: £0.01 million). Total proceeds received over the nearly four-year life of the investment were £1.94 million, compared to an original cost of £0.75 million, which is a multiple on cost of 2.6x and an IRR of 33.0%.

 

Red Paddle

 

Design and manufacturer of Stand up paddleboards

 

July 2015 to November 2021

£4.44 million

4.9 x cost

The Company sold its investment in Vian Marketing (trading as Red Paddle) to Myers Family Office for £3.71 million (realised gain in the year: £2.41 million). Total proceeds received to date over the six-year life of the investment were £4.44 million compared to an original investment cost of £0.90 million, which is a multiple on cost of 4.9x and an IRR of 31.5%. Further proceeds of £0.40 million were received after the year end.

 

Loan stock repayments and other gains/(losses)

During the year and following the admission of its shares to AIM, the Company received £1.25 million from the partial realisation of its holding in Parsley Box, generating a realised gain of £0.54 million. Over the two years to date this investment has been held, this partial sale generated a multiple of cost of 4.0x on the cost of the shares sold. The Company also received £1.26 million from the partial realisation of MPB Group generating a realised gain of £0.41 million. This partial realisation generated a 7.8x multiple of cost on the cost of the shares sold and was the result of Vitruvian Partners, a large private equity investor, taking a sizeable equity investment in the company. There was a further partial realisation of MyTutor which generated £0.70 million proceeds for the Company and a realised gain in the year of £0.38 million.

 

 

In addition to the above, proceeds of £2.96 million were received via loan repayments from Virgin Wines, Media Business Insight, Vian Marketing (trading as Red Paddle), MPB Group and BG Training, generating realised gains totalling £0.26 million. Finally, deferred consideration totalling £0.10 million in realised gains was received in respect of investments realised in a previous year. A small realised loss of £(0.06) million was also recognised in respect of transaction costs for Virgin Wines due to stamp duty paid upon the admission of the shares to listing on AIM.

InvestmentPortfolio Yield

2021

£m

2020

£m

Interestreceivedinthe year

0.98

2.13

Dividendsreceivedin the year

0.35

0.66

Total portfolioincome intheyear1

1.33

2.79

Portfolio valueat31 December

65.58

41.68

Portfolio IncomeYield (Incomeasa%of Portfoliovalueat 31 December)

2.0%

6.7%




1   Total portfolio income in the year is generated solely from investee companies within the portfolio. The fall in interest received is due to a significant interest receipt of £1.08 million from the realisation of Auction Technology Group in 2020.

 

New investments after the year-end

The Company made one new investment of £0.61 million after the year-end, as detailed below:

 

Company

Business

Date of investment

Amount of new investment (£m)

Proximity Insight

Retail Software

February 2022

0.61

Proximity Insight (proximityinsight.com) is a retail technology business that offers a 'Super-App' that is used by the customer-facing teams of brands and retailers to engage, inspire and transact with customers. Headquartered in London with offices in New York and Sydney, Proximity Insight has a global client base that includes over 20 brands, boutiques and department stores in fashion, beauty, jewellery, electronics and homewares. These clients use Proximity Insight's platform to blur the lines between physical and digital retail, enhancing the customer experience and improving the lifetime value of their customers by upwards of 35%. The business grew annual recurring revenue by 117% to £2.2 million in 2021, and the investment will support Proximity Insight's continued product development and international growth. The investment was made across all six VCTs advised and managed by Gresham House, including the two Baronsmead VCTs.

 

 

Further investments after the year-end

The Company made further investments totalling £0.34 million into an existing portfolio company after the year-end, as detailed below:

 

Company

Business

Date of investment

Amount of further investment (£m)

Caledonian Leisure

UK leisure and experience breaks

January-February 2022

0.22

Caledonian Leisure works with accommodation providers, coach businesses and other experienced providers (such as entertainment destinations and theme parks) to deliver UK-based leisure and experience breaks to its customers. It comprises two brands, Caledonian Travel (caledoniantravel.com) and UK Breakaways (ukbreakaways.com). The business has significantly exceeded planned revenues since launch and this funding will provide additional working capital to facilitate further growth.

Northern Bloc

Vegan and dairy-free ice cream producer

April 2022

0.12

Northern Bloc Ice Cream (northern-bloc.com) is an established food brand in the emerging and rapidly growing vegan market. By focusing on chef quality and natural ingredients, Northern Bloc has carved out an early mover position in the vegan ice cream sector. The company's focus on plant-based alternatives has strong environmental credentials as well as it being the first ice cream brand to move wholly into sustainable packaging. Following the initial investment in December 2020, Northern Bloc has grown rapidly and strengthened its prospects. COVID disruption has impacted its plan but this further investment provides additional working capital and funds a new production facility to increase its resilience, flexibility and margins in the future.

 

Environmental, Social, Governance considerations

When seeking new investment opportunities, the Investment Adviser under Mobeus ensured that each potential new investment was subject to a comprehensive due diligence process encompassing commercial, financial and ESG-related considerations.

 

Following the novation of the advisory agreement to Gresham House on 30 September 2021, a market leader that is well-resourced with knowledge and expertise in sustainability, the Investment Advisor has moved to establish ESG procedures and protocols of the highest standards as set out and informed by Gresham House plc. The first tangible example of this revised approach is that that the individual members of the investment team now have their own individual ESG objectives set which align with the wider ESG goals of the Investment Adviser.

 

Gresham House is committed to sustainable investment as an integral part of its business strategy. During 2021, the Investment Adviser has taken further steps to formalise its approach to sustainability and has put in place several processes to ensure environmental, social and governance ("ESG") factors and stewardship responsibilities are built into asset management across all funds and strategies, including venture capital trusts.

 

Gresham House believes the "G" (Governance) of ESG is the most important factor in its investment processes. Board composition, governance, control, company culture, alignment of interests, shareholder ownership structure and remuneration policy are important elements that will feed into the analysis and the valuation of portfolio companies.

 

The "E" and "S" (Environmental and Social) will be assessed as risk factors during due diligence to eliminate companies that face environmental and social risks that cannot be mitigated through engagement and governance changes.

 

Where material ESG risks are identified, these will be reviewed by the Adviser and a decision on how to proceed will be documented. The Adviser will then proactively follow up with the investee company management team and ensure appropriate corrective and preventative action is taken and any material issues or incidents are recorded by the Adviser.

 

Gresham House published its inaugural Sustainable Investment Report in 2021 that, along with existing asset specific policies, including the Public Equity Policy, can be found on its website (www.greshamhouse.com). These reports and policies cover the Investment Adviser's sustainable investment commitments, how the investment processes meet these commitments and the application of the sustainable investment framework.  The Gresham House Board and General Management Committee assess the adherence to the commitments in the Sustainable Investment Policies on an annual basis.

 

In a changing world, the Investment Adviser believes that this approach will contribute towards the enhancement of Shareholder value going forward.

 

 

Outlook

The growth strategy implemented in 2015 is clearly showing signs of bearing fruit with many companies beginning to achieve significant scale and attract the interest of public markets and larger secondary investors. The portfolio is in a healthy position with many companies trading well throughout the lockdowns, and several at record levels. It continues to evolve, offering a balance of fast-growing and more stable investments at various stages of maturity and scale across a range of diverse market sectors. There is a significant exposure to businesses operating a direct-to-consumer business model which has contributed to strong trading performance during the year. This also gives confidence about the future strength of the portfolio and its ability to cope with the challenges and opportunities associated with Brexit, the macro-economic outlook and the ongoing impact of COVID-19. The new investment pipeline is recovering to levels seen pre-COVID-19 and the prospects for capital deployment are encouraging.

The exceptional performance experienced since the impact of COVID-19 in March 2020 is, therefore, likely to moderate over the next 12 months as the level of activity normalises. Although the threat of further lockdowns to combat emerging new variants appears to have lessened somewhat, there still remains much uncertainty around the wider impact of the pandemic upon the economy, particularly in respect of supply chain and inflationary issues. The tragic events currently unfolding in Ukraine have amplified this uncertainty and stressed financial markets around the world. The Investment Adviser has reviewed the underlying assets and has concluded that there are no material impacts on the valuation of the portfolio. Whilst this has created significant short term volatility post year-end, the portfolio is in robust shape and the investment activity levels are promising. Gresham House therefore remains optimistic for the future.

 

 

Gresham House Asset Management Limited

Investment Adviser

6 April 2022

 

 

Investment Portfolio Summary as at 31 December 2021





% of

% of


Cost at

Valuation at

Valuation at

equity

 portfolio


31-Dec-21

31-Dec-20

31-Dec-21

held

by value


£

£

£



Investment Portfolio






Preservica Limited

3,397,745

3,611,144

11,056,628

13.1%

16.9%

Seller of proprietary digital archiving software






Virgin Wines UK plc (formerly Virgin Wines Holding Company Limited)1,2

45,915

6,312,889

9,486,219

8.3%

14.5%

Online wine retailer






MPB Group Limited

1,095,252

4,126,952

5,764,694

3.2%

8.8%

Online marketplace for used photographic equipment






My TutorWeb Limited (trading as MyTutor)

2,464,757

2,476,581

5,015,751

5.3%

7.6%

Digital marketplace connecting school pupils seeking one-to-one online tutoring






EOTH Limited (trading as Equip Outdoor Technologies)

951,471

2,400,632

4,847,187

1.7%

7.4%

Distributor of branded outdoor equipment and clothing including the Rab and Lowe Alpine brands






Media Business Insight Holdings Limited

2,225,042

1,013,748

3,560,047

15.7%

5.4%

A publishing and events business focused on the creative production industries






End Ordinary Group Limited (trading as Buster and Punch)

1,496,785

2,646,272

3,305,392

7.8%

5.0%

Industrial inspired lighting and interiors retailer






Master Removers Group 2019 Limited (trading as Anthony Ward Thomas, Bishopsgate and Aussie Man & Van)

348,641

1,044,971

3,001,004

6.6%

4.6%

A specialist logistics, storage and removals business






Data Discovery Solutions Limited (trading as ActiveNav)

1,408,640

2,201,000

2,624,447

7.7%

4.0%

Provider of global market leading file analysis software for information governance, security and compliance






Manufacturing Services Investment Limited (trading as Wetsuit Outlet)

2,333,102

2,331,110

2,331,133

6.4%

3.6%

Online retailer in the water sports market






Bella & Duke Limited

877,381

836,042

2,050,122

4.4%

3.1%

A premium frozen raw dog food provider






Arkk Consulting Limited

1,599,445

1,178,143

1,680,942

6.7%

2.6%

Provider of services and software to enable organisations to remain compliant with regulatory reporting requirements






Tharstern Group Limited

1,091,886

1,037,390

1,204,783

12.2%

1.8%

MIS & Commercial print software solutions






Connect Childcare Group Limited

846,007

846,007

994,110

3.0%

1.5%

Nursery management software provider






Vivacity Labs Limited

914,754

-

914,754

4.4%

1.4%

Provider of artificial intelligence & urban traffic control systems






Bleach London Holdings Limited

629,772

832,878

791,477

3.1%

1.2%

Hair colourants brand






Rota Geek Limited

874,000

726,667

765,890

4.4%

1.2%

Workforce management software






Spanish Restaurant Group Limited (trading as Tapas Revolution)

1,219,096

139,317

739,557

6.7%

1.1%

Spanish restaurant chain






Caledonian Leisure Limited

328,502

-

695,000

6.6%

1.1%

Provider of UK leisure and experience breaks






Legatics Holdings Limited

663,011

-

663,011

6.0%

1.0%

SaaS LegalTech software provider






Pets' Kitchen Limited (trading as Vet's Klinic)

631,120

-

631,120

4.5%

1.0%

Veterinary clinics






IPV Limited

619,487

619,487

619,487

5.5%

0.9%

Provider of media asset software






Northern Bloc Ice Cream Limited

304,050

304,050

498,768

5.5%

0.8%

Dairy-free ice cream producer






Parsley Box Group plc (formerly Parsley Box Limited)1,3

631,003

1,937,571

417,536

3.1%

0.6%

Supplier of home delivered, ambient ready meals targeting the over 60s






CGI Creative Graphics International Limited

1,449,746

390,849

397,434

6.3%

0.6%

Vinyl graphics to global automotive, recreation vehicle and aerospace markets






RDL Corporation Limited

1,000,000

151,247

317,413

8.9%

0.5%

Recruitment consultants for the pharmaceutical, and IT industries






Muller EV Limited (trading as Andersen EV)

341,600

217,904

195,200

7.2%

0.3%

Provider of premium electric vehicle (EV) chargers






Kudos Innovations Limited

328,950

152,488

81,979

2.4%

0.1%

Online platform that provides and promotes academic research dissemination






Jablite Holdings Limited (in members' voluntary liquidation)

376,083

49,597

49,597

9.1%

0.1%

Manufacturer of expanded polystyrene products






Veritek Global Holdings Limited

1,620,086

-

-

15.4%

0.0%

Maintenance of imaging equipment






BookingTek Limited

582,300

-

-

3.5%

0.0%

Software for hotel groups






Oakheath Limited (in members' voluntary liquidation)

485,730

-

-

4.3%

0.0%

Online platform that connects people seeking care home from experienced independent carers






Racoon International Group Limited

484,347

-

-

8.0%

0.0%

Supplier of hair extensions, hair care products and training












Disposals in year






Proactive Group Holdings Inc

-

1,900,421

-

0.0%

0.0%

Provider of media services and investor conferences for companies primarily listed on secondary public markets






Vian Marketing Limited (trading as Red Paddle Co)

-

1,465,304

-

0.0%

0.0%

Design, manufacture and sale of stand-up paddleboards and windsurfing sails






Omega Diagnostics Group plc1

-

266,680

-

0.0%

0.0%

In-vitro diagnostics for food intolerance, auto-immune diseases and infectious diseases






BG Training Limited

-

7,969

-

0.0%

0.0%

City-based provider of specialist technical training
























Total

33,665,706

41,225,310

64,700,682


98.7%







Former Elderstreet Private Equity Portfolio






Cashfac Limited

260,101

451,386

851,035

2.9%

1.3%

Provider of virtual banking application software solutions to corporate customers





Sift Group Limited

135,391

-

32,750

1.3%

0.0%

Developer of business-to-business internet communities






Total

395,492

451,386

883,785


1.3%

Total Investment Portfolio

34,061,198

41,676,696

65,584,467


100.0%

Total Investment Portfolio split by type






Growth focused portfolio⁴

25,768,093

32,713,007

50,568,974


77.1%

MBO focused portfolio⁴

8,293,105

8,963,689

15,015,493


22.9%







Investment Adviser's Total

34,061,198

41,676,696

65,584,467


100.0%







Notes:







1 Quoted on AIM.






2 Admitted to AIM during the year. Ahead of the Admission to AIM of Virgin Wines on 2 March 2021, the Company's equity investment in Virgin Wines Holding Company Ltd ("VWHCL") had been exchanged for an equity investment in Rapunzel Newco Limited ("RNL"), a company owned by the four Mobeus VCTs pro rata to each VCT's share of its investment in Virgin Wines. Immediately prior to Admission, RNL exchanged its equity investment in VWHCL for an equity investment in Virgin Wines UK plc ("VWUK"). The Company is beneficially interested in VWUK, through its holding in RNL. RNL is the legal owner of the shares in VWUK, but each VCT is the beneficial holder. As part of Virgin Wines' admission to AIM, the Company received repayment of its loan stock generating proceeds of £1.83 million.

3 Admitted to AIM during the period. On 7 January 2021, a £0.26 million follow-on investment was made into Parsley Box Limited. The enlarged shareholding was admitted to AIM on 31 March 2021. Ahead of the admission to AIM, the Company's equity investment in Parsley Box Limited had been exchanged for an equity investment in Parsley Box Group UK plc. Upon admission to AIM, the Company invested a further £0.01 million and realised  proceeds of £1.25 million.

The growth focused portfolio contains all investments made after the change in the VCT regulations in 2015 plus some investments that are growth in nature made before this date. The MBO focused portfolio contains investments made prior to 2015 as part of the previous MBO strategy and also includes five companies preparing to trade.







 

 

 

 

 

PRINCIPAL RISKS

The Directors acknowledge the Board's responsibilities for the Company's internal control systems and have instigated systems and procedures for identifying, evaluating and managing the significant and emerging risks faced by the Company. This includes a key risk management review and robust assessment of the risks, which takes place at each quarterly board meeting. Further details of these are contained in the corporate governance section of the Directors' Report on within the Annual Report. The principal risks and the emerging risk identified by the Board are set out below:

 

Risk

Possible consequence

How the Board manages risk

Loss of approval as a Venture Capital Trust

The Company must comply with section 274 of the Income Tax Act 2007 ("ITA") which allows it to be exempt from capital gains tax on investment gains. Any breach of these rules may lead to the Company losing its approval as a Venture Capital Trust, qualifying Shareholders who have not held their shares for the designated holding period having to repay the income tax relief they obtained and future dividends paid by the Company becoming subject to tax. The Company would also lose its exemption from corporation tax on capital gains.

· The Company's VCT qualifying status is continually reviewed by the Investment Adviser and confirmed at each Board meeting.

· Regular reports are received from the VCT Status Adviser retained by the Board in order to monitor the Company's ongoing compliance with the VCT Rules.

Economic and Political

Events such as the war in Ukraine, the COVID-19 pandemic, the impact of Brexit, an economic recession, supply shortages or a movement in sterling or in interest rates, could affect trading conditions for smaller companies and consequently the value of the Company's qualifying investments.

Movements in UK Stock Market indices may affect the valuation of the Company's investments, as well as affecting the Company's own share price and its discount to net asset value.

The invasion of Ukraine and resulting economic sanctions imposed on trade with Russia has also impacted global financial markets. Whilst the portfolio has limited direct exposure to these geographies, this action is expected to exacerbate macroeconomic risk factors in the short term.

· The Board monitors the portfolio as a whole to:

(1)  ensure that the Company invests as far as possible in a diversified portfolio of companies;

(2)  ensure that developments in the macro- economic environment such as movements in interest rates are monitored; and

(3)  with regard to COVID-19, the Investment Adviser holds ongoing discussions with all the portfolio companies to ascertain where support is required. Cash comprises a significant proportion of the net assets of the Company, further to the successful realisations and the fund-raise earlier in the year giving the Company a strong liquidity position. The portfolio has minimal exposure to sectors such as leisure, hospitality, retail travel which are currently more at risk.

Investment

Investment in VCT qualifying earlier stage unquoted small companies involves a higher degree of risk than investment in fully listed companies. Smaller companies often have limited product lines, markets or financial resources, may not be profitable at the point of investment and may be dependent for their management on a smaller number of key individuals. This may lead to variable investment returns and the use of more subjective valuation methodologies.

· The Board regularly reviews the Company's investment strategy.

· Careful selection and review of the investment portfolio occurs on a regular basis.

· The Investment Adviser has provided a growing pipeline of compliant investment opportunities and continues to strengthen its investment team.

· The valuation of the investment portfolio and valuation methodologies are reviewed by the Board each quarter.

Regulatory

The Company is required to comply with the Companies Act, the Listing Rules of the UK Listing Authority and United Kingdom Accounting Standards. Changes to and breach of any of these might lead to suspension of the Company's Stock Exchange listing, financial penalties, a qualified audit report or the loss of the Company's status as a VCT. Furthermore, changes to the UK VCT legislation or the State-aid rules could have an adverse effect on the Company's ability to achieve satisfactory investment returns.

· Regulatory and legislative developments are kept under review by the Company's solicitors and the Board.

Financial and operating

Failure of systems (including breaches of data security) at any of the third-party service providers that the Company has contracted with could lead to inaccurate reporting or monitoring. Inadequate controls could lead to the misappropriation or insecurity of assets. Outsourcing and the increase in remote working could give rise to cyber and data security risks, particularly relating to the threat of ransomware attacks, as well as internal control risk.

· The Board carries out a bi-annual review of the internal controls in place and reviews the risks facing the Company at Board meetings and receives control reports by exception.

· It reviews the performance of the service providers annually and has obtained assurance that such providers have controls in place to reduce the risk of breaches of their cyber security.

Market

Movements in the valuations of the Company's investments will, inter alia, be connected to movements in UK Stock Market indices as well as affecting the Company's own share price and its discount to net asset value.

· The Board receives quarterly valuation reports from the Investment Adviser and, where necessary, challenges its valuation process and metrics.

· The Investment Adviser alerts the Board about any adverse movements.

Asset liquidity

The Company's investments may be difficult to realise.

· The Board receives reports from the Investment Adviser and reviews the portfolio at each quarterly Board meeting. It carefully monitors investments where a particular risk has been identified.

Environmental, Social and Governance Emerging Risk

Non-compliance with current and future reporting requirements could lead to a fall in demand from investors. That may affect the level of capital the Company has available to meet its investment objectives.

· ESG and climate change is taken into account when considering new investment proposals. The Investment Adviser monitors the potential impact on investee companies of any proposed new legislation regarding environmental, social and governance matters and advises and adapts accordingly.

· The Board recognises that climate change is an important emerging risk that the Company is taking into account in their strategic planning although the Company itself has little direct impact on environmental issues. Measures have been introduced to reduce the cost and environmental impact of providing paper copies of Shareholder correspondence and to decrease the amount of travel undertaken.

The risk profile of the Company changed as a result of changes to VCT legislation 2015. As the Company is required to focus its new investment activity on growth capital investments in younger companies it is anticipated that investment returns will be more volatile and have a higher risk profile. The Board also discusses emerging risks as and when they arise, such as the COVID-19 pandemic, and puts in place mitigating actions to manage the risk. In an environment of ultra-low interest rates, returns on liquidity may impact overall performance. This factor is monitored by the Board with the objective of optimising returns on liquid funds whilst minimising capital risk.

 

 

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report and the Financial Statements in accordance with applicable law and regulations.

 

Company law requires the directors to prepare financial statements for each financial year.  Under that law the directors are required to prepare the financial statements and have elected to prepare the company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising Financial Reporting Standard 102, the Financial Reporting Standard applicable in the UK and Republic of Ireland ('FRS 102') and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss for the company for that period.

 

In preparing these Financial Statements, the Directors are required to:

 

  select suitable accounting policies and then apply them consistently;

  make judgements and accounting estimates that are reasonable and prudent;

  state whether the Financial Statements have been prepared in accordance with United Kingdom accounting standards, subject to any material departures disclosed and explained in the Financial Statements;

  prepare the Financial Statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business; and

  prepare a Strategic Report, a Directors' Report and Directors' Remuneration Report which comply with the requirements of the Companies Act 2006.

 

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that the Financial Statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

Website publication

The Financial Statements are published on the Company's website at www.mig4vct.co.uk, which is maintained by the Investment Adviser. The maintenance and integrity of the website maintained by the Investment Adviser is, so far as it relates to the Company, the responsibility of the Investment Adviser. The work carried out by the Auditors does not involve consideration of the maintenance and integrity of this website and, accordingly, the Auditor accepts no responsibility for any changes that have occurred to the accounts since they were initially presented to the website. The accounts are prepared in accordance with UK legislation, which may differ from legislation in other jurisdictions.

 

Directors' responsibilities pursuant to Disclosure and Transparency Rule 4 of the UK Listing Authority

The Directors confirm to the best of their knowledge that:

 

a)  the Financial Statements, which have been prepared in accordance with United Kingdom Generally Accepted Accounting Practice, give a true and fair view of the assets, liabilities, financial position and the profit and loss of the Company.

 

b)  the Annual Report includes a fair review of the development and performance of the business and the position of the Company, together with a description of the principal risks and uncertainties that it faces.

 

Having taken advice from the Audit Committee, the Board considers the Annual Report and Financial Statements, taken as a whole, as fair, balanced and understandable and that it provides the information necessary for Shareholders to assess the Company's position, performance, business model and strategy.

 

Neither the Company nor the Directors accept any liability to any person in relation to the Annual Report except to the extent that such liability could arise under English law. Accordingly, any liability to a person who has demonstrated reliance on any untrue or misleading statement or omission shall be determined in accordance with section 90A and schedule 10A of the Financial Services and Markets Act 2000.

 

The names and functions of the Directors are stated within the Annual Report.

 

For and on behalf of the Board

 

Jonathan Cartwright

Chairman

6 April 2022

 

 

FINANCIAL STATEMENTS

 

Income Statement for the year ended 31 December 2021

31 December 2021

31 December 2020


Notes

Revenue

Capital

Total

Revenue

Capital

Total



£

£

£

£

£

£

Net investment portfolio gains

8

-

29,904,336

29,904,336

-

13,307,684

13,307,684

Income

3

1,354,209

-

1,354,209

2,868,103

-

2,868,103

Investment Adviser's fees

4a

(428,601)

(1,285,804)

(1,714,405)

(309,827)

(929,481)

(1,239,308)

Other expenses

4d

(460,888)

-

(460,888)

(426,422)

-

(426,422)

Profit on ordinary activities before taxation


464,720

28,618,532

29,083,252

2,131,854

12,378,203

14,510,057









Taxation on profit on ordinary activities

5

(22,097)

22,097

-

(280,053)

176,602

(103,451)









Profit for the year and total comprehensive income


442,623

28,640,629

29,083,252

1,851,801

12,554,805

14,406,606









Basic and diluted earnings per ordinary share

6

0.53p

34.16p

34.69p

2.22p

15.05p

17.27p









The revenue column of the Income Statement includes all income and expenses. The capital column accounts for the net investment portfolio gains (unrealised gains and realised gains on investments) and the proportion of the Investment Adviser's fee charged to capital.









The total column is the Statement of Total Comprehensive Income of the Company prepared in accordance with Financial Reporting Standards ("FRS"). In order to better reflect the activities of a VCT and in accordance with the 2014 Statement of Recommended Practice ("SORP") (updated in April 2021) by the Association of Investment Companies ("AIC"), supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented alongside the Income Statement. The revenue column of profit attributable to equity shareholders is the measure the Directors believe appropriate in assessing the Company's compliance with certain requirements set out in Section 274 Income Tax Act 2007.









All the items in the above statement derive from continuing operations of the Company. No operations were acquired or discontinued in the year.


The notes below form part of these Financial Statements.

 

Balance Sheet as at 31 December 2021











Company No. 3707697















31 December 2021




31 December 2020


Notes


£

£

£


£

£

£

Fixed assets










Investments at fair value





65,584,467 




41,676,696 











Current assets










Debtors and prepayments

 


2,895,532 




403,568 



Current investments


20,475,179 




22,634,956 



Cash at bank


4,059,487 




4,053,536 







27,430,198 




27,092,060 












Creditors: amounts falling due within one year




(227,411)




(307,561)


Net current assets





27,202,787 




26,784,499 











Net assets





92,787,254 




68,461,195 





















Capital and reserves










Called up share capital

10 




833,897 




840,040 

Share premium reserve





13,129,427 




12,495,262 

Capital redemption reserve





33,606 




20,512 

Revaluation reserve





32,819,832 




10,205,933 

Special distributable reserve





20,109,912 




26,563,547 

Realised capital reserve





24,028,652 




16,738,215 

Revenue reserve





1,831,928 




1,597,686 

Equity shareholders' funds





92,787,254 




68,461,195 











Basic and diluted net asset value per ordinary share

11




111.27p




81.50p











The notes below form part of these Financial Statements.











The Financial Statements were approved and authorised for issue by the Board of Directors on 6 April 2022 and were signed on its behalf by:





















Jonathan Cartwright










Chairman




















 

Statement of Changes in Equity for the year ended 31 December 2021 


Non-distributable reserves

Distributable reserves



Called up

Share

Capital


Special

Realised

Revenue



share

premium

redemption

Revaluation

distributable

capital

reserve



capital

reserve

reserve

reserve

reserve

reserve


Total






(Note a)

(Note b)

(Note b)


 Notes

£

£

£

£

£

£

£

£










At 1 January 2021

840,040

12,495,262

20,512

10,205,933

26,563,547

16,738,215

1,597,686

68,461,195

Comprehensive income for the year









Profit for the year

-

-

-

25,711,355

-

2,929,274

442,623

29,083,252

Total comprehensive income for the year

-

-

-

25,711,355

-

2,929,274

442,623

29,083,252










Contributions by and distributions to owners









Dividends re-invested into new shares  10

6,951

634,165

-

-

-

-

-

641,116

Shares bought back (Note c)  10

(13,094)

-

13,094

-

(1,230,702)

-

-

(1,230,702)

Dividends paid  7

-

-

-

-

(3,959,226)

-

(208,381)

(4,167,607)

Total contributions by and distributions to owners

(6,143)

634,165

13,094

-

(5,189,928)

-

(208,381)

(4,757,193)










Other movements









Realised losses transferred to special reserve (Note a)

-

-

-

-

(1,263,707)

1,263,707

-

-

Realisation of previously unrealised appreciation

-

-

-

(3,097,456)

-

3,097,456

-

-

Total other movements

-

-

-

(3,097,456)

(1,263,707)

4,361,163

-

-










At 31 December 2021

833,897

13,129,427

33,606

32,819,832

20,109,912

24,028,652

1,831,928

92,787,254










Note a: The Special distributable reserve also provides the Company with a reserve to absorb any existing and future realised losses and, when considered by the Board to be in the interests of shareholders, to fund share buybacks and for other corporate purposes. The transfer of £1,263,707 to the special reserve from the realised capital reserve above is the total of realised losses incurred by the Company in the year.  As at 31 December 2021, the Company has a special reserve of £20,109,912, £18,530,799 of which arises from shares issued more than three years ago. Reserves originating from share issues are not distributable under VCT rules if they arise from share issues that are within three years of the end of an accounting period in which shares were issued.

Note b: The realised capital reserve and the revenue reserve together comprise the Profit and Loss Account of the Company shown on the Balance Sheet.

Note c: During the year, the Company purchased 1,309,349 of its own shares at the prevailing market price for a total cost of £1,230,702, which were subsequently cancelled.

Statement of Changes in Equity for the year ended 31 December 2020











Non-distributable reserves

Distributable reserves



Called up

Share

Capital


Special

Realised

Revenue



share

premium

redemption

Revaluation

distributable

capital

reserve



capital

reserve

reserve

reserve

reserve

reserve


Total











£

£

£

£

£

£

£

£










At 1 January 2020

667,991

-

8,056

3,713,586

35,514,889

8,935,662

1,195,130

50,035,314

Comprehensive income for the year









Profit for the year

-

-

-

8,866,811

-

3,687,994

1,851,801

14,406,606

Total comprehensive income for the year

-

-

-

8,866,811

-

3,687,994

1,851,801

14,406,606










Contributions by and distributions to owners









Shares issued via Offer for Subscription

184,505

12,815,495

-

-

-


-

13,000,000

Issue costs and facilitation fees on Offer for Subscription

-

(320,233)

-

-

(145,330)


-

(465,563)

Shares bought back

(12,456)

-

12,456

-

(728,216)

-

-

(728,216)

Dividends paid

-

-

-

-

(6,337,701)

-

(1,449,245)

(7,786,946)

Total contributions by and distributions to owners

172,049

12,495,262

12,456

-

(7,211,247)

-

(1,449,245)

4,019,275










Other movements









Realised losses transferred to special reserve

-

-

-

-

(1,740,095)

1,740,095

-

-

Realisation of previously unrealised appreciation

-

-

-

(2,374,464)

-

2,374,464

-

-

Total other movements

-

-

-

(2,374,464)

(1,740,095)

4,114,559

-

-










At 31 December 2020

840,040

12,495,262

20,512

10,205,933

26,563,547

16,738,215

1,597,686

68,461,195










 

Called up share capital










The nominal value of shares originally issued increased for subsequent share issues either via an Offer for Subscription or Dividend Investment Scheme or reduced due to shares bought back by the Company.

Share premium reserve










This reserve contains the excess of gross proceeds less issue costs over the nominal value of shares allotted under recent Offers for Subscription and the Company's Dividend Investment scheme.

Capital redemption reserve










The nominal value of shares bought back and cancelled is held in this reserve, so that the Company's capital is maintained.

Revaluation reserve










Increases and decreases in the valuation of investments held at the year-end are accounted for in this reserve, except to the extent that the diminution is deemed permanent. In accordance with stating all investments at fair value through profit and loss (as recorded in Note 8), all such movements through both revaluation and realised capital reserves are shown within the Income Statement for the year.

Special distributable reserve










This reserve is created from cancellations of the balances upon the Share premium reserve, which are transferred to this reserve from time to time. The cost of share buybacks is charged to this reserve. In addition, any realised losses on the sale or impairment of investments (excluding transaction costs), 75% of the Investment Adviser fee expense and 100% of the Investment Adviser performance fee expense, and the related tax effect, are transferred from the realised capital reserve to this reserve. This reserve will also be charged any IFA facilitation payments to advisers, which arose as part of the Offer for Subscription.

Realised capital reserve

The following are accounted for in this reserve:

• Gains and losses on realisation of investments;
• Permanent diminution in value of investments;
• Transaction costs incurred in the acquisition and disposal of investments;
• 75% of the Investment Adviser fee expense and 100% of any performance incentive fee payable, together with the related tax effect to this reserve in accordance with the policies; and    Capital dividends paid.

Revenue reserve

Income and expenses that are revenue in nature are accounted for in this reserve, as well as 25% of the Investment Adviser fee together with the related tax effect, as well as income dividends paid that are classified as revenue in nature.

 

The Notes below form part of these Financial Statements.










 

Statement of Cash Flows for the year ended 31 December 2021

 








Year ended 31 December 2021


Year ended 31 December 2020


Notes






£


£

Cash flows from operating activities





Profit for the financial year


29,083,252


14,406,606

Adjustments for:





Net investment portfolio gains


(29,904,336)


(13,307,684)

Tax charge for the current year


-


103,451

Decrease/(increase) in debtors


87,812


(220,393)

Increase/(decrease) in creditors


23,302


(2,616)

Net cash (outflow)/inflow from operations


(709,970)


979,364

Corporation tax paid


(103,452)


(35,383)

Net cash (outflow)/inflow from operating activities


(813,422)


943,981






Cash flows from investing activities





Sale of investments

8

12,231,857


14,974,305

Purchase of investments

8

(6,235,292)


(4,805,036)

Net cash inflow from investing activities


5,996,565


10,169,269



 




Cash flows from financing activities





Share issued as part of Offer for Subscription


-


13,000,000

Issue costs and facilitation fees as part of Offer for subscription


-


(465,563)

Equity dividends paid

7

(6,106,267)


(7,786,946)

Purchase of own shares


(1,230,702)


(728,216)

Net cash (outflow)/inflow from financing activities


(7,336,969)


4,019,275











Net (decrease)/increase in cash and cash equivalents


(2,153,826)


15,132,525

Cash and cash equivalents at start of year


24,688,492


9,555,967

Cash and cash equivalents at end of year


22,534,666


24,688,492






Cash and cash equivalents comprise:





Cash at bank and in hand

9

4,059,487


4,053,536

Cash equivalents

9

18,475,179


20,634,956
















The notes below form part of these Financial Statements.





 

 

 

 

 

 

 

Notes to the Financial Statements for the year ended 31 December 2021

 

1

Company information


Mobeus Income and Growth 4 VCT plc is a public limited company incorporated in England, registration number 03707697. The registered office is 5 New Street Square, London, EC4A 3TW.

 

2

Basis of preparation


A summary of the principal accounting policies, all of which have been applied consistently throughout the year are set out next to the related disclosure throughout the Notes to the Financial Statements. All accounting policies are included at the top of each relevant note.

These Financial Statements have been prepared in accordance with applicable United Kingdom accounting standards, including Financial Reporting Standard 102 ("FRS102"), with the Companies Act 2006 and the 2014 Statement of Recommended practice, 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' ('the SORP') (updated in April 2021) issued by the Association of Investment Companies. The Financial Statements have been prepared on the historical cost basis except for the modification to a fair value basis for certain financial instruments which are disclosed under FRS102 s11/12 as shown in Note 15 of the Notes to the accounts within the Annual Report.

 

After performing the necessary enquiries, the Directors have undertaken an assessment of the Company's ability to meet its liabilities as they fall due. The Company has significant cash and liquid resources and no external debt or capital commitments. The Company's cash flow forecasts, which consider levels of anticipated new and follow-on investment, the net funds raised as part of the Company's 2021/22 Offer for Subscription, as well as investment income and annual running cost projections, are discussed at each quarterly Board meeting and, in particular, have been considered in light of the ongoing impact of the COVID-19 pandemic. The Directors have also received assurances that the Company's key suppliers' abilities to continue to service the Company have not been materially impacted by the COVID-19 pandemic. Following this assessment, the Directors have a reasonable expectation that the Company will have adequate resources to continue to meet its liabilities for at least 12 months from the date of these Financial Statements. The Directors therefore consider the preparation of these Financial Statements on a going concern basis to be appropriate.

 

3

Income


Dividends receivable on quoted equity shares are brought into account on the ex-dividend date. Dividends receivable on unquoted equity shares are brought into account when the Company's right to receive payment is established and there is no reasonable doubt that payment will be received.

 

Interest income on loan stock is accrued on a daily basis. Provision is made against this income where recovery is doubtful or where it will not be received in the foreseeable future. Where the loan stocks only require interest or a redemption premium to be paid on redemption, the interest and redemption premium is recognised as income or capital as appropriate once redemption is reasonably certain.

 

When a redemption premium is designed to protect the value of the instrument holder's investment rather than reflect a commercial rate of revenue return, the redemption premium is recognised as capital. The treatment of redemption premiums is analysed to consider if they are revenue or capital in nature on a company by company basis. Accordingly, the redemption premium recognised in the year ended 31 December 2021 has been classified as capital and has been included within gains on investments.

 


2021

2020


£

£

Income from bank deposits

18,559

29,451




Income from investments



-  from equities

348,420

657,891

-  from overseas based OEICs

2,258

42,612

-  from loan stock

984,972

2,113,964

-  from interest on preference share dividend arrears

-

17,770


1,335,650

2,832,237




Other income

-

6,415




Total income

1,354,209

2,868,103




Total income comprises



Dividends

350,678

700,503

Interest

1,003,531

2,161,185

Other income

-

6,415


1,354,209

2,868,103







Total loan stock interest due but not recognised in the year was £458,279 (2020: £777,919). This decrease is due to a number of investee companies resuming payment of loan interest where previously provisions in light of COVID-19 had been in place.

 

 

4

Investment Adviser's fees and performance fees


All expenses are accounted for on an accruals basis.

 

a)  Investment Adviser's fees

 

25% of the Investment Adviser's fee is charged to the revenue column of the Income Statement, while 75% is charged against the capital column of the Income Statement. This is in line with the Board's expected long-term split of returns from the investment portfolio of the Company.

 

100% of any performance incentive fee payable for the year is charged against the capital column of the Income Statement, as it is based upon the achievement of capital growth.

 


Revenue

Capital

Total

Revenue

Capital

Total


2021

2021

2021

2020

2020

2020


£

£

£

£

£

£








Gresham House Asset Management Limited

428,601

1,285,804

1,714,405

309,827

929,481

1,239,308

 

Under the terms of a revised investment management agreement dated 12 November 2010, Mobeus Equity Partners LLP ("Mobeus") (from 1 October 2021, Gresham House Asset Management Limited) provides investment advisory, administrative and company secretarial services to the Company, for a fee of 2% per annum of closing net assets, calculated on a quarterly basis by reference to the net assets at the end of the preceding quarter, plus a fixed fee of £115,440 per annum, the latter being subject to indexation, if applicable. In 2013, Mobeus agreed to waive such further increases due to indexation, until otherwise agreed with the Board.

 

The Investment Adviser fee includes provision for a cap on expenses excluding irrecoverable VAT and exceptional items set at 3.4% of closing net assets at the year end. In accordance with the investment management agreement, any excess expenses are borne by the Investment Adviser. The excess expenses during the year amounted to £nil (2020: £nil).

 

In line with common practice, Gresham House retains the right to charge arrangement and syndication fees and Directors' or monitoring fees to companies in which the Company invests. The Investment Adviser received fees totalling £349,777 (2020: £341,947) during the year ended 31 December 2021, being £132,667 (2020: £126,542) for arrangement fees, and £217,110 (2020: £215,405) for acting as non-executive directors on a number of investee company boards. These fees attributable to the Company are proportionate to the investment allocation to the Company which applied at the time of each investment. These figures are not part of these financial statements.

 

b)  Incentive fee agreement

Under the terms of a separate agreement dated 1 November 2006, from the end of the accounting period ending on 31 January 2009 and in each subsequent accounting period throughout the life of the company, the Investment Adviser will be entitled to receive a performance related incentive fee of 20% of the dividends paid in excess of a "Target Rate" comprising firstly, an annual dividend target of 6% of the net asset value per share at 5 April 2007 (indexed each year for RPI) and secondly a requirement that any cumulative shortfalls below the 6 per cent hurdle must be made up in later years, while any excess is not carried forward, whether a fee is payable for that year or not. Payment of a fee is also conditional upon the average Net Asset Value ("NAV") per share for each such year equalling or exceeding the average Base NAV per share for the same year. As at 31 December 2021, the average NAV per share is below the average Base NAV per share so no incentive fee is payable to date.

 

c)  Offer for Subscription fees

 


2021

2020


£m

£m

Gross funds raised by the Company

-

13.00

Offer costs payable to Mobeus at 3.00% of gross funds raised by the Company

-

0.39

 

Under the terms of an Offer for Subscription, with the other Mobeus advised VCTs, launched on 25 October 2019, Mobeus was entitled to fees of 3.00% of the investment amount received from investors. This amount totalled £1.74 million across all four VCTs, out of which all the costs associated with the allotment were met, excluding any payments to advisers facilitated under the terms of the Offer.

 


d)  Other expenses

Other Expenses are charged wholly to revenue, with the exception of expenses incidental to the acquisition or disposal of an investment, which are written off to the capital column of the Income Statement or deducted from the disposal proceeds as appropriate.

 


2021

2020


£

£

Directors' remuneration (including NIC of £9,750 (2020: £10,309)) - Note i)

  144,750

  141,524

IFA trail commission

  88,938

  78,825

Broker's fees

  12,000

  9,000

Auditor's fees - Audit of Company (excluding VAT)

  33,191

  26,650

  - audit related assurance services (excluding VAT) - Note ii)

  6,212

  5,919

Registrar's fees

  42,343

  54,145

Printing

  46,227

  42,113

Legal & professional fees

  14,274

  11,544

VCT monitoring fees

  9,600

  9,600

Directors' insurance

  8,975

  7,573

Listing and regulatory fees

  44,787

  28,700

Sundry

  9,591

  8,333

Running Costs

  460,888

  423,926

Provision against loan interest receivable - Note iii)

  - 

  2,496

Other expenses

  460,888

  426,422






Note i): Directors' remuneration is a related party transaction, see analysis in Directors' Remuneration table within the Directors' Remuneration Report within the Annual Report, which excludes the NIC above. The key management personnel were the four Non-Executive Directors. The Company has no employees. At the year-end, £538 was owed from Christopher Burke due to an overpayment of salary, which was subsequently adjusted for in the following quarter.

 

Note ii): The audit-related assurance services are in relation to a limited scope engagement in respect of the Financial Statements within the Company's Interim Report. The Audit Committee reviews the nature and extent of these services to ensure that auditor independence is maintained.

 

Note iii): Provision against loan interest receivable above relates to an amount of £nil (2020: £2,496), being a provision made against loan stock interest regarded as collectable in previous years.





5

Taxation on ordinary activities


 

The tax expense for the year comprises current tax and is recognised in profit or loss. The current income tax charge is calculated on the basis of tax rates and laws that have been enacted or substantively enacted by the reporting date.

 

Any tax relief obtained in respect of adviser fees allocated to capital is reflected in the capital reserve - realised and a corresponding amount is charged against revenue. The tax relief is the amount by which corporation tax payable is reduced as a result of these capital expenses.

 

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date where transactions or events that result in an obligation to pay more tax in the future or a right to pay less tax in the future have occurred at the balance sheet date. Timing differences are differences between the Company's taxable profits and its results as stated in the financial statements that arise from the inclusion of gains and losses in the tax assessments in periods different from those in which they are recognised in the financial statements.

 

Deferred tax is measured at the average tax rates that are expected to apply in the years in which the timing differences are expected to reverse based on tax rates and laws that have been enacted or substantively enacted at the balance sheet date. Deferred tax is measured on a non-discounted basis.

 

A deferred tax asset would be recognised only to the extent that it is more likely than not that future taxable profits will be available against which the asset can be utilised.

 


2021

2020


Revenue

Capital

Total

Revenue

Capital

Total


£

£

£

£

£

£

a)  Analysis of tax charge:







UK Corporation tax on profits for the year

22,097

(22,097)

-

280,053

(176,602)

103,451

Total current tax charge

22,097

(22,097)

-

280,053

(176,602)

103,451

Corporation tax is based on a rate of 19% (2020: 19%)














b) Profit on ordinary activities before tax

464,720

28,618,532

29,083,252

2,131,854

12,378,203

14,510,057

Profit on ordinary activities multiplied by company rate of corporation tax in the UK of 19% (2020: 19%)

88,297

5,437,521

5,525,818

405,052

2,351,859

2,756,911

Effect of:







UK dividends not taxable

(66,200)

-

(66,200)

(124,999)

-

(124,999)

Net investment portfolio gains not taxable

-

(5,681,824)

(5,681,824)

-

(2,528,461)

(2,528,461)

Losses not utilised

-

222,206

222,206

-

-

-

Actual tax charge

22,097

(22,097)

-

280,053

(176,602)

103,451

 

Tax relief relating to investment adviser fees is allocated between revenue and capital where such relief can be utilised.

 

No asset or liability has been recognised for deferred tax in relation to capital gains or losses on revaluing investments as the Company is exempt from corporation tax in relation to capital gains or losses as a result of qualifying as a Venture Capital Trust.

 

There is no potential liability to deferred tax (2020: £nil). There is no unrecognised deferred tax asset in 2021 (2020: £nil).

 

6

Basic and diluted earnings per share


 


2021

2020


£

£

Total earnings after taxation:

  29,083,252

  14,406,606

Basic and diluted earnings per share (Note a)

  34.69p

  17.27p

Net revenue from ordinary activities after taxation

  442,623

  1,851,801

Basic and diluted revenue return per share (Note b)

  0.53p

  2.22p




Net investment portfolio gains

  29,904,336

  13,307,684

Capital expenses (net of taxation)

(1,263,707)

(752,879)

Total capital return

  28,640,629

  12,554,805

Basic and diluted capital return per share (Note c)

  34.16p

  15.05p




Weighted average number of shares in issue in the year

  83,840,235

  83,426,755

 

Notes:

a)  Basic earnings per share is total earnings after taxation divided by the weighted average number of shares in issue.

 

b)  Basic revenue earnings per share is the revenue return after taxation divided by the weighted average number of shares in issue.

 

c)  Basic capital earnings per share is the total capital return after taxation divided by the weighted average number of shares in issue.

 

d)  There are no instruments that will increase the number of shares in issue in future. Accordingly, the above figures currently represent both basic and diluted returns.

 



7

Dividends paid and payable


Dividends payable are recognised as distributions in the financial statements when the Company's liability to pay them has been established. This liability is established for interim dividends when they are paid, and for final dividends when they are approved by the Shareholders, usually at the Company's Annual General Meeting.

 

A key judgement in applying the above accounting policy is in determining the amount of minimum income dividend to be paid in respect of a year. The Company's status as a VCT means it has to comply with Section 259 of the Income Tax Act 2007, which requires that no more than 15% of the income from shares and securities in a year can be retained from the revenue available for distribution for the year.

 

Amounts recognised as distributions to equity shareholders in the year:

Dividend

Type

For year ended 31 December

Pence per share

Date Paid

2021  £

2020  £

Final

Capital*

2019

4.00p

10/01/2020

  - 

  2,671,965

Interim

Income

2020

1.70p

07/05/2020

  - 

  1,449,245

Interim

Capital*

2020

4.30p

07/05/2020

  - 

  3,665,736

Interim

Income

2021

0.25p

06/08/2021

  208,381

  -

Interim

Capital*

2021

4.75p

06/08/2021

  3,959,226

  -






 4,167,607**

 7,786,946

 

* - Paid out of or refunded to the Company's special distributable reserve.

** -  For the year ended 31 December 2021, £4,167,607 disclosed above differs to that shown in the Statement of Cash Flows of £6,106,267 due to a dividend payment of £2,579,776 made to the Registrar before the year-end in respect of the dividend paid to Shareholders on 7 January 2022. This amount is held as a debtor at the year-end. This amount was partially offset by £641,116 of new shares issued as part of the Company's Dividend Investment Scheme.

 

 

 








Distributions to equity holders after the year end:

Type

For year ended 31 December

Pence per share

Date paid/payable

2021  £

2020  £

Interim

Income

2021

0.25p

07/01/2022

  209,560

  - 

Interim

Capital*

2021

3.75p

07/01/2022

  3,143,394

  - 













  3,352,954

  - 

* - Paid out of the Company's special distributable reserve.

Any proposed final dividend is subject to approval by Shareholders at the Annual General Meeting and has not been included as a liability in these financial statements.

Set out below are the total income dividends payable in respect of the financial year, which is the basis on which the requirements of section 274 of the Income Tax Act 2007 are considered.








Recognised income distributions in the financial statements for the year





Dividend

Type

For year ended 31 December

Pence per share

Date paid/payable

2021  £

2020  £

Revenue available for distribution by way of dividends for the year

442,623

1,851,801

Interim

Income

2020

1.70p

07/05/2020

  - 

  1,449,245

Interim

Income

2021

0.25p

06/08/2021

  208,381

  - 

Interim

Income

2021

0.25p

07/01/2022

209,560

-

Total income dividends for the year





  417,941

1,449,245

 

 

8

Investments at fair value


The most critical estimates, assumptions and judgements relate to the determination of the carrying value of investments at "fair value through profit and loss" (FVTPL). All investments held by the Company are classified as FVTPL and measured in accordance with the International Private Equity and Venture Capital Valuation ("IPEV") guidelines, as updated in December 2018. This classification is followed as the Company's business is to invest in financial assets with a view to profiting from their total return in the form of capital growth and income.

 

Purchases and sales of unlisted investments are recognised when the contract for acquisition or sale becomes unconditional. For investments actively traded on organised financial markets, fair value is generally determined by reference to Stock Exchange market quoted bid prices at the close of business on the balance sheet date. Purchases and sales of quoted investments are recognised on the trade date where a contract of sale exists whose terms require delivery within a time frame determined by the relevant market. Where the terms of a disposal state that consideration may be received at some future date and, subject to the conditionality and materiality of the amount of deferred consideration, an estimate of the fair value discounted for the time value of money may be recognised through the Income Statement. In other cases, the proceeds will only be recognised once the right to receive payment is established and there is no reasonable doubt that payment will be received.

 

Unquoted investments are stated at fair value by the Directors at each measurement date in accordance with appropriate valuation techniques, which are consistent with the IPEV guidelines:-

 

i.  Each investment is considered as a whole on a 'unit of account' basis, i.e. that the value of each portfolio company is considered as a whole, alongside consideration of:-

 

The price of new or follow-on investments made, if deemed to be made as part of an orderly transaction, are considered to be at fair value at the date of the transaction. The inputs that derived the investment price are calibrated within individual valuation models and at subsequent measurement dates, are reconsidered for any changes in light of more recent events or changes in the market performance of the investee company. The valuation bases used are the following:

 

· a multiple basis. The shares may be valued by applying a suitable price-earnings ratio, revenue or gross profit multiple to that company's historic, current or forecast post-tax earnings before interest, depreciation and amortisation, or revenue, or gross profit (the ratio used being based on a comparable sector but the resulting value being adjusted to reflect points of difference identified by the Investment Adviser compared to the sector including, inter alia, scale and liquidity).

 

 

or:-

 

· where a company's underperformance against plan indicates a diminution in the value of the investment, provision against the price of a new investment is made, as appropriate.

 

ii.  Premiums, to the extent that they are considered capital in nature, and that they will be received upon repayment of loan stock investments, are accrued at fair value when the Company receives the right to the premium and when considered recoverable.

 

iii.  Where a multiple or the price of recent investment less impairment basis is not appropriate and overriding factors apply, a discounted cash flow, net asset valuation, realisation proceeds, or a weighted average of these bases may be applied.

 

Capital gains and losses on investments, whether realised or unrealised, are dealt with in the profit and loss and revaluation reserves and movements in the period are shown in the Income Statement.

All investments are initially recognised and subsequently measured at fair value. Changes in fair value are recognised in the Income Statement.

 

A key judgement made in applying the above accounting policy relates to investments that are permanently impaired. Where the value of an investment has fallen permanently below price of recent investment, the loss is treated as a permanent impairment and as a realised loss, even though the investment is still held. The Board assesses the portfolio for such investments and, after agreement with the Investment Adviser, will agree the values that represent the extent to which an investment loss has become realised. This is based upon an assessment of objective evidence of that investment's future prospects, to determine whether there is potential for the investment to recover in value.

 

The methods of fair value measurement are classified into hierarchy based on the reliability of the information used to determine the valuation.

 

Level 1 -  Fair value is measured based on quoted prices in an active market.

Level 2 -  Fair value is measured based on directly observable current market prices or indirectly being derived from market prices.

Level 3 - Fair value is measured using valuation techniques using inputs that are not based on observable market data.

 

Movements in investments during the year are summarised as follows:

 


Traded on AIM

Unquoted equity shares

Unquoted preference shares

Unquoted loan stock

Total


£

£

£

£

£

Cost at 31 December 2020

50,011

19,150,794

905,332

12,836,189

32,942,326

Unrealised gains/(losses) at 31 December 2020

216,669

13,262,864

64,294

(3,337,894)

10,205,933

Permanent impairment in value of investments as at 31 December 2020

-

(1,406,948)

(227)

(64,388)

(1,471,563)

Valuation at 31 December 2020

266,680

31,006,710

969,399

9,433,907

41,676,696







Purchases at cost

-

4,238,438

566,200

1,430,654

6,235,292

Sale proceeds (Note a)

(1,611,332)

(6,905,286)

(63,709)

(3,651,530)

(12,231,857)

Reclassification at value (Note b)

6,638,097

(6,188,772)


(449,325)

-

Net realised gains in the year

641,268

3,296,609

63,591

191,513

4,192,981

Net unrealised gains in the year (Note c)

3,969,042

20,524,983

72,857

1,144,473

25,711,355

Valuation at 31 December 2021

9,903,755

45,972,682

1,608,338

8,099,692

65,584,467







Cost at 31 December 2021

676,918

21,412,982

1,471,414

10,499,884

34,061,198

Unrealised gains/(losses) at 31 December 2021

9,226,837

25,791,648

137,151

(2,335,804)

32,819,832

Permanent impairment in value of investments at 31 December 2021 (Note d)

-

(1,231,948)

(227)

(64,388)

(1,296,563)

Valuation at 31 December 2021

9,903,755

45,972,682

1,608,338

8,099,692

65,584,467

 

Details of investment transactions such as disposal proceeds, valuation movements, cost and carrying value at the end of previous year are contained in the Investment Portfolio Summary in the Annual Report.

 

Net realised gains in the year of £4,192,981 and unrealised gains in the year of £25,711,355 equal net investment portfolio gains of £29,904,336 as shown on the Income Statement.

 

Note a) Disposals of investment portfolio companies during the year were:

 

Company

Type

Investment Cost

Disposal Proceeds

Valuation at 31 December 2020

Realised gain/(loss) in year



£

£

£

£

Vian Marketing Limited (trading as Red Paddle Co)

Realisation

  789,006

  3,947,311

  1,465,304

  2,482,007

Parsley Box Group plc (formerly Parsley Box Limited)

Part Realisation

  309,932

  1,246,218

  703,384

  542,834

MPB Group Limited

Part Realisation

  385,741

  1,596,618

  1,185,343

  411,275

My Tutorweb Limited

Part Realisation

  258,149

  699,864

  316,023

  383,841

Media Business Insight Limited

Loan repayment

  497,718

  497,718

  308,854

  188,864

Omega Diagnostics Group plc

Realisation

  50,011

  422,823

  266,680

  156,143

Virgin Wines UK Plc (formerly Virgin Wines
Holding Company Limited)

Loan repayment

  1,884,898

  1,884,898

  1,884,898

  -

CB Imports Group Limited

Liquidation

175,000

  - 

  -

  -

Proactive Group Holdings Inc

Realisation

  755,340

  1,894,238

  1,900,421

( 6,183)







Other capital proceeds

Various

  10,625

  42,169

  7,969

  34,200









5,116,420

12,231,857

8,038,876

4,192,981

 

* Other capital proceeds contains a loan repayment of £10,625 from BG Training, and £89,253 of deferred consideration from companies realised in previous years, offset by a stamp duty payment of £57,709 upon the listing of Virgin Wines shares to AIM.

 

Note b) The Company's equity investments in Virgin Wines and Parsley Box were admitted to AIM during the year. The amount transferred from Level 3 to Level 1 of £6,638,097 reflects the combined equity value held at the start of the year and a follow-on investment made in the year. The amount of £449,325 transferred from unquoted loan stock to unquoted equity shares represents the conversion of the loans held in two portfolio companies into equity shares during the year.

 

Note c) The major components of the net increase in unrealised valuations of £25,711,355 in the year were increases of £6,199,781 in Preservica Limited, of £5,058,228 in Virgin Wines UK plc (previously Virgin Wines Holding Company Limited), £2,855,153 in Media Business Insight Holdings Limited, £2,823,085 in MPB Group Limited, and £2,446,555 in EOTH Limited. These increases were partly offset by the falls of £1,089,185 in Parsley Box Group plc (formerly Parsley Box Limited), £169,104 in Muller EV Limited (trading as Andersen EV Limited), and £151,501 in Bleach London Holdings Limited.

 

Note d) During the year, permanent impairments of the cost of investments have reduced from £1,471,563 to £1,296,563 due to the disposal of one investee company.



9

Cash at bank and Current Investments


Cash equivalents, for the purposes of the Statement of Cash flows, comprises bank deposits repayable on up to three months' notice and funds held in OEIC money-market funds. Current asset investments are the same but also include bank deposits that mature after three months. Current asset investments are disposable without curtailing or disrupting the business and are readily convertible into known amounts of cash at their carrying values at immediate or up to three months' notice. Cash, for the purposes of the Statement of Cash Flows, is cash held with banks in accounts subject to immediate access. Cash at bank in the Balance Sheet is the same.

 


2021

2020


£

£

OEIC Money market funds

18,475,179

20,634,956

Cash equivalents per Statement of Cash Flows

18,475,179

20,634,956

Bank deposits that mature after three months

2,000,000

2,000,000

Current asset investments

20,475,179

22,634,956




Cash at bank

4,059,487

4,053,536



10

Called up share capital


 


2021

2020


£

£




Allotted, called-up and fully paid:



Ordinary shares of 1p each: 83,389,721 (2020: 84,004,018)

833,897

840,040

 

During the year, the Company purchased 1,309,349 (2020: 1,245,646) of its own shares for cash (representing 1.6% (2020: 1.9%) of the shares in issue at the start of the year) at the prevailing market price for a total cost of £1,230,702 (2020: £728,216). These shares were subsequently cancelled by the Company.

 

Under the terms of the Dividend Investment Scheme, 695,092 shares were allotted during the year for a non-cash consideration of £641,116.

 

11

Basic and diluted net asset value per share


Net asset value per Ordinary Share is based on net assets at the end of the year, and on 83,389,721 (2020: 84,004,018) Ordinary shares, being the number of Ordinary shares in issue on that date.

 

There are no instruments that will increase the number of shares in issue in future. Accordingly, the figures currently represent both basic and diluted net asset value per share.

 

12

Post balance sheet events


On 7 January 2022, the Company paid a 4.00 pence per share dividend to Shareholders in respect of the year ended 31 December 2021.

 

On 24 January 2022 and 22 February 2022, further investments totalling £0.22 million were made into Caledonian Leisure Limited.

 

On 1 February 2022, a loan repayment of £0.10 million was received from Media Business Insight Limited.

 

On 10 February 2022, a new investment of £0.61 million was made into Proximity Insight Limited.

 

On 16 February 2022, deferred proceeds of £0.40 million were received in respect of Vian Marketing Limited (trading as Red Paddle Co), an investment realised in the previous year.

 

Prior to the allotment of shares under the 2022 Offer for Subscription launched on 20 January 2022, the NAV was updated as at 28 February 2022 as the basis for allocation. This produced a NAV per share of 98.77 pence compared to a NAV per share at 31 December 2021 of 107.27 pence (adjusted for the 4.00 pence dividend paid on 7 January 2022). Subsequently, on 9 March 2022, 7,361,191 Ordinary Shares were allotted at an average effective offer price of 101.89 pence per share, raising net funds of £7.27 million.

 

On 6 April 2022, a further investment of £0.12 million was made into Northern Bloc Ice Cream Limited.

 


Statutory information


The financial information set out in these statements does not constitute the Company's statutory accounts for the year ended 31 December 2021 but is derived from those accounts.  Statutory accounts will be delivered to the Registrar of Companies after the Annual General Meeting.  The auditors have reported on these accounts and their report was unqualified and did not contain a statement under section 498(2) of the Companies Act 2006.

 


Annual Report & Financial Statements


The Annual Report will be published on the Company's website at www.mig4vct.co.uk shortly and, following the adoption of electronic communications by the Company, shareholders will shortly receive notification from the Company on how to download a pdf of the Report from the website.  Shareholders and members of the public who wish to receive a hard copy of the Annual Report, may request a copy by writing to the Company Secretary, Gresham House Asset Management Limited, 80 Cheapside, London EC2V 6EE or by email: [email protected].

 


Annual General Meeting


The Company's next Annual General Meeting will be held on Tuesday, 17 May 2022 at the offices of the Company's solicitors, Shakespeare Martineau, at 60 Gracechurch Street, London EC3V 0HR. A webcast will also be available at the same time for those Shareholders who cannot attend in person. However, please note that Shareholders will not be able to vote via this method and so are encouraged to return their proxy form before the deadline of 13 May 2022.

 


Contact details for further enquiries


Gresham House Asset Management Limited (the Company Secretary) on +44(0) 20 7382 0999 or by email to [email protected]




DISCLAIMER


Neither the contents of the Company's website nor the contents of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated into, or forms part of, this announcement.

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact [email protected] or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.
 
END
 
 
FR IFMTTMTIMTPT

a d v e r t i s e m e n t