As required by the UK Listing Authority's Disclosure and Transparency Rule 4.2, Crown Place VCT PLC today makes public its information relating to the Half-yearly Financial Report (which is unaudited) for the six months to 31 December 2011. This announcement was approved by the Board of Directors on 27 February 2012.
The full Half-yearly Financial Report (which is unaudited) for the period to 31 December 2011, will shortly be sent to shareholders. Copies of the full Half-yearly Financial Report will be shown via the Albion Ventures LLP website www.albion-ventures.co.uk under the "Our Funds" section by clicking Crown Place VCT PLC.
Financial highlights (unaudited)
| Six months ended | Six months ended | Year ended | |
| 31 December 2011 | 31 December 2010 | 30 June 2011 | |
| (pence per share) | (pence per share) | (pence per share) | |
| Net asset value per share | 32.86 | 34.68 | 33.65 |
| Dividends paid | 1.25 | 1.25 | 2.50 |
| Revenue return per share | 0.52 | 0.38 | 1.11 |
| Capital (loss)/return per share | (0.11) | 1.58 | 1.04 |
Net asset value total return to shareholders since launch:
| 31 December 2011 (pence per share) | |
| Total dividends paid during the period from launch to 6 April 2005 (prior to change of manager) | 24.93 |
| Total dividends paid during the year ended 28 February 2006 | 1.00 |
| Total dividends paid during the period ended 30 June 2007 | 3.30 |
| Total dividends paid during the year ended 30 June 2008 | 2.50 |
| Total dividends paid during the year ended 30 June 2009 | 2.50 |
| Total dividends paid during the year ended 30 June 2010 | 2.50 |
| Total dividends paid during the year ended 30 June 2011 | 2.50 |
| Total dividends paid during the six months ended 31 December 2011 | 1.25 |
| Total dividends paid to 31 December 2011 | 40.48 |
| Net asset value as at 31 December 2011 | 32.86 |
| Total net asset value shareholder return as at 31 December 2011 | 73.34 |
In addition to the dividends paid above, the Board has declared a second dividend for the year ending 30 June 2012, of 1.25 pence per Crown Place VCT PLC share, to be paid on 30 March 2012 to shareholders on the register as at 9 March 2012.
Shareholder returns and shareholder value
| Proforma (i) Murray VCT PLC | Proforma (i) Murray VCT 2 PLC | Crown Place VCT PLC* | |
| (pence per share) | (pence per share) | (pence per share) | |
| Shareholder return from launch to April 2005 (date that Albion Ventures was appointed investment manager): | |||
| Total dividends paid to 6 April 2005 (ii) | 30.36 | 30.91 | 24.93 |
| Decrease in net asset value | (69.90) | (64.50) | (56.60) |
| Total shareholder return to 6 April 2005 | (39.54) | (33.59) | (31.67) |
| Shareholder return from April 2005 to 31 December 2011: | |||
| Total dividends paid | 11.36 | 13.38 | 15.55 |
| Decrease in net asset value | (6.71) | (7.54) | (10.54) |
| Total shareholder return from April 2005 to 31 December 2011 | 4.65 | 5.84 | 5.01 |
| Shareholder value since launch: | |||
| Total dividends paid to 31 December 2011 (ii) | 41.72 | 44.29 | 40.48 |
| Net asset value as at 31 December 2011 | 23.39 | 27.96 | 32.86 |
| Total shareholder value as at 31 December 2011 | 65.11 | 72.25 | 73.34 |
| Current dividend objective: | |||
| Pence per share (per annum) | 1.78 | 2.13 | 2.50 |
| Percentage yield on net asset value as at 31 December 2011 | 7.6% | 7.6% | 7.6% |
- Proforma shareholder returns are based on the dividends paid to shareholders before the merger and the pro-rata net asset value per share and pro-rata dividends per share paid to 31 December 2011 since the merger. This pro-forma is based upon the proportion of shares received by Murray VCT PLC (now renamed CP1 VCT PLC) and Murray VCT 2 PLC (now renamed CP2 VCT PLC) shareholders at the time of the merger with Crown Place VCT PLC on 13 January 2006.
- Prior to 6 April 1999, venture capital trusts were able to add 20% to dividends, and figures for the period up until 6 April 1999 are included at the gross equivalent rate actually paid to shareholders
* Formerly Murray VCT 3 PLC
Investment objectives
The investment objective and policy of the Company* is to achieve long term capital and income growth principally through investment in smaller unquoted companies in the United Kingdom.
In pursuing this policy, the Manager aims to build a portfolio which concentrates on two complementary investment areas. The first are more mature or asset-based investments that can provide a strong income stream combined with a degree of capital protection. These will be balanced by a lesser proportion of the portfolio being invested in higher risk companies with greater growth prospects.
*The "Company" is Crown Place VCT PLC. The "Group" is the Company together with its subsidiaries CP1 VCT PLC and CP2 VCT PLC.
Financial calendar
| Record date for second dividend | 9 March 2012 |
| Payment of second dividend | 30 March 2012 |
| Financial year end | 30 June 2012 |
Interim management report
Results
In the six month period to 31 December 2011, the Group recorded a positive total return of 0.41 pence per share or 1.2 per cent. on opening net assets. As at 31 December 2011 and following the payment of the first dividend for the year of 1.25 pence per share, the net asset value was 32.86 pence per share (30 June 2011: 33.65 pence per share). The total return for the period was £311,000 of which the revenue return was £398,000 and the capital loss was £87,000. The results include a £357,000 one-off repayment in respect of historic VAT received from the previous manager, Murray Johnstone Limited. This is described in more detail in note 4 of this announcement. This gain is partially offset by unrealised capital losses on investments of £181,000.
Dividends
The Company's policy is to pay regular and predictable dividends to investors out of revenue income and realised capital gains. The first dividend for the current financial year of 1.25 pence per share was paid to shareholders on 30 November 2011. A second dividend of 1.25 pence per share will be paid on 30 March 2012 to shareholders on the register on 9 March 2012. The Board aims to maintain the current annualised dividend distribution of 2.5 pence per share going forward, subject to the availability of cash resources and distributable reserves.
Dividends are paid free of tax to shareholders and qualifying shareholders who elect to participate in the Dividend Reinvestment Scheme will be able, in respect of further dividends, to receive their dividends in the form of new shares rather than cash, which will entitle them to income tax relief at the rate of 30 per cent. (new shares will need to be held for at least five years to attract the tax relief). Further details of the Dividend Reinvestment Scheme can be found on the Manager's website www.albion-ventures.co.uk/Our Funds/Crown Place VCT PLC.
Portfolio Review
During the six month period, the Company made total investments of £2,080,000. Of this amount, £501,000 related to new investments in Hilson Moran, a multi-disciplinary engineering consultancy where the funding supported a management buy-out, and Alto Prodotto, a wind power-generator based in Wales. The remaining £1,579,000 was invested in existing portfolio businesses including £570,000 in Oakland Care Centre to fund the development of the care home against a pre-agreed payment schedule. Other scheduled investments include £220,000 in Regenerco Renewable Energy, £125,000 in Street by Street Solar Programme and £46,000 in Nelson House Hospital. The remaining funds were invested to support some of the high growth businesses in the portfolio.
Realisations during the period totalled £258,000, mostly through the repayment of loan stock by House of Dorchester, Booth Dispensers, Evolutions Group and Tower Bridge Health Club.
Whilst the current difficult economic conditions provide an unhelpful headwind for a number of investee companies, there are a number that are performing well. Of note are the cinemas and Radnor House School, which are performing ahead of plan. The portfolio is well diversified and benefits from a high proportion of asset-backed investments with no external gearing. Several of the asset-backed investments are yet to mature and offer an attractive capital upside as well as their income generating potential. In the growth portfolio, a number of companies continue to progress and have attractive long term prospects. However, the partial provisions made against three technology-related investments, Helveta, Xceleron and DySis, following the need for further financing, contributed to the overall loss on investments for the six month period.
There are only two material holdings in the AIM portfolio - Avanti Communications and Augean. Avanti's share price declined during the six month period and is now trading close to net asset value, while Augean's share price was broadly static. In the opinion of the Manager, both these companies have good long term potential.
The chart below illustrates the composition of the portfolio by industry sector. The majority of the investments in the hotels, pubs, cinemas, health and fitness clubs and education segments and several of the healthcare investments are backed by freehold or long leashold assets with no external gearing.
Set out at the bottom of this announcement is the sector diversification of the portfolio of our investments at 31 December 2011.
Source: Albion Ventures LLP
Risks and uncertainties
The outlook for the UK economy continues to be the key risk affecting your Company. Growth in the UK is stagnant while the prospects for Europe look difficult. Importantly, investment risk is mitigated through a variety of processes, including our policy of ensuring that the Company has a first charge over investee companies' assets wherever possible.
Meanwhile, opportunities within our target sectors continue to arise at attractive valuations, including in the healthcare and environmental sectors, which continue to be two core areas of activity.
A detailed analysis of the other risks and uncertainties facing the business is shown on page 19 of the annual report and financial statement for the year ended 30 June 2011.
Change of registrar
As part of our commitment to improve our investor experience, our share registrars have changed to Computershare Investor Services PLC. Shareholders can access holdings and valuation information regarding any of their shares held by Computershare by registering on Computershare's website. The Computershare Investor Centre can be found at www.investorcentre.co.uk. Further contact details are shown in the front of these accounts.
Discount management and share buy-backs
It remains the Board's policy to buy back shares in the market, subject to the overall constraint that such purchases are in the VCT's interests, including the maintenance of sufficient resources for investment in new and existing investee companies and the continued payment of dividends to shareholders. It is the Board's intention for such buy-backs to be in the region of a 10 to 15 per cent. discount to net asset value, so far as market conditions and liquidity permit. During the six months ended 31 December 2011, the Company purchased 891,000 shares at an average price of 28.5 pence per share.
Related party transactions
Details of material related party transactions for the year can be found in note 12.
Going concern
The Board's assessment is that liquidity risk is low, and remains as detailed on page 52 of the Annual Report and Financial Statements for the year ended 30 June 2011. The Company has significant cash and liquid resources. The portfolio of investments is diversified in terms of sector, and the major cash outflows of the Company (namely investments, share buy-backs and dividends) are within the Company's control. Accordingly, after making enquiries, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. For this reason the Directors have adopted the going concern basis in preparing the accounts in accordance with Going Concern and Liquidity Risk: Guidance for Directors of UK Companies 2009, published by the Financial Reporting Council.
Albion VCTs Linked Top Up Offer 2011/2012
On 1 November 2011 the Company announced the launch of the Albion VCTs Linked Top Up Offer 2011/2012. Since the year end, 1,191,601 shares have been issued under this Offer, generating net proceeds of £378,000. The proceeds of the Offer will be used to provide further resources to the Albion VCTs at a time when a number of attractive new investment opportunities are being seen. Details of these allotments are shown in note 11.
An Investor Guide and Offer Document have been sent to shareholders and can also be found on the Manager's website www.albion-ventures.co.uk .
Outlook
The outlook for the UK economy continues to be uncertain with little signs of sustainable economic growth. Public sector funding cuts are yet to have their full impact and there are increasing risks to growth from unemployment and inflation. Interest rates are forecast to remain low for an extended period, which has an adverse impact on the ability of the Company to generate income from its cash resources and some of its loan investments. Against this difficult background, your Company remains conservatively financed and is invested in a broadly diversified portfolio with a significant proportion of asset backed investments. Some of these asset backed investments, such as the renewable energy companies, the care homes and Radnor House, the independent school, have the potential to generate significantly higher levels of income as they mature. The Board views this VCT as a long term savings product and, in this context, the Directors consider that the Company remains well positioned to deliver long term shareholder value.
| Patrick Crosthwaite | |
| Chairman |
27 February 2012
Responsibility statement
The Directors, P. Crosthwaite, R. Beagles, K. Brade and V. Lall are responsible for preparing the Half-yearly Financial Report. The Directors have chosen to prepare this Half-yearly Financial Report for the Group in accordance with International Financial Reporting Standards ("IFRS").
In preparing the summarised set of Financial Statements for the period to 31 December 2011, we the Directors, confirm that to the best of our knowledge:
(a) the summarised set of Financial Statements has been prepared in accordance with International Accounting Standard (IAS) 34 "Interim Financial Reporting" issued by the International Accounting Standards Board;
(b) the interim management report includes a fair review of the information required by DTR 4.2.7R (indication of important events during the first six months and description of principal risks and uncertainties for the remaining six months of the year);
(c) the summarised set of Financial Statements give a true and fair view in accordance with IFRS of the assets, liabilities, financial position and of the profit and loss of the Group for the six months ended 31 December 2011 as required by DTR 4.2.4R, and comply with IFRS and Companies Act 2006 and;
(d) the interim management report includes a fair review of the information required by DTR 4.2.8R (disclosure of related parties' transactions and changes therein).
The accounting policies applied to the Half-yearly Financial Report have been consistently applied in current and prior periods and are those applied in the Annual Report and Financial Statements for the year ended 30 June 2011.
This Half-yearly Financial Report has not been audited or reviewed by the Auditor.
By order of the Board of Directors
Patrick Crosthwaite
Chairman
27 February 2012
Portfolio of investments
The following is a list of non-current investments with a carrying/fair value as at 31 December 2011.
| As at 31 December 2011 (unaudited) | As at 30 June 2011 (audited) | ||||||||
| Investment name | Nature of business | % voting rights | % voting rights of AVL* managed companies | Investment to date at cost £'000 | Total value £'000 | Investment to date at cost £'000 | Total value £'000 | Change in total value for the period** £'000 | |
| Qualifying unquoted asset-backed investments | |||||||||
| The Crown Hotel Harrogate Limited | Owner and operator of the Crown Hotel, Harrogate | 15.0 | 50.0 | 2,976 | 2,177 | 2,976 | 2,179 | (2) | |
| Oakland Care Centre Limited | Owner and operator of a care home | 18.4 | 50.0 | 1,600 | 1,661 | 1,030 | 1,056 | 35 | |
| Radnor House School (Holdings) Limited | Owner and operator of an independent school | 9.0 | 50.0 | 1,564 | 1,621 | 1,564 | 1,614 | 7 | |
| Kensington Health Clubs Limited | Owner and operator of a health and fitness club in West London | 7.2 | 50.0 | 1,789 | 1,227 | 1,789 | 1,247 | (20) | |
| The Stanwell Hotel Limited | Owner and operator of the Stanwell Hotel at Heathrow Airport | 10.8 | 50.0 | 1,531 | 1,069 | 1,454 | 1,053 | (61) | |
| The Charnwood Pub Company Limited | Owner and operator of freehold pubs | 6.9 | 50.0 | 2,204 | 1,018 | 2,204 | 1,029 | (11) | |
| Kew Green VCT (Stansted) Limited | Owner and operator of the 'Express by Holiday Inn' at Stansted Airport | 2.0 | 50.0 | 1,000 | 963 | 1,000 | 954 | 9 | |
| Orchard Portman Hospital Limited | Owner and operator of a psychiatric hospital in Taunton | 11.3 | 50.0 | 732 | 735 | 711 | 713 | 1 | |
| CS (Brixton) Limited | Cinema owner and operator | 9.6 | 50.0 | 411 | 713 | 411 | 596 | 117 | |
| Tower Bridge Health Clubs Limited | Owner and operator of a health and fitness club in central London | 9.5 | 50.0 | 553 | 663 | 577 | 649 | 38 | |
| Bravo Inns II Limited | Owner and operator of freehold pubs | 4.1 | 50.0 | 505 | 489 | 505 | 483 | 6 | |
| TEG Biogas (Perth) Limited | Provider of anaerobic digestion facilities | 6.1 | 50.0 | 364 | 376 | 352 | 354 | 10 | |
| Regenerco Renewable Energy Limited | PV Installations on small commercial buildings | 1.8 | 50.0 | 241 | 241 | 21 | 21 | - | |
| The Street by Street Solar Programme Limited | Provider of PV installations on domestic roofs | 3.5 | 50.0 | 208 | 208 | 83 | 83 | - | |
| Nelson House Hospital Limited | Developing a psychiatric hospital in Gosport | 4.0 | 50.0 | 185 | 185 | 139 | 139 | - | |
| The Weybridge Club Limited | Owner and operator of a freehold health and fitness club in Weybridge, Surrey | 1.2 | 50.0 | 190 | 150 | 190 | 148 | 2 | |
| Alto Prodotto Wind Limited | Wind power generator focused on sites in Wales | 3.3 | 50.0 | 141 | 143 | - | - | 2 | |
| Bravo Inns Limited | Owner and operator of freehold pubs | 2.6 | 50.0 | 230 | 142 | 230 | 140 | 2 | |
| CS (Exeter) Limited | Cinema owner and operator | 9.6 | 50.0 | 157 | 131 | 157 | 114 | 17 | |
| Taunton Hospital Limited | Owner and operator of a psychiatric hospital in Taunton | 1.6 | 50.0 | 100 | 100 | 100 | 100 | - | |
| Premier Leisure (Suffolk) Limited | Freehold cinema owner | 5.7 | 50.0 | 420 | 96 | 420 | 101 | (5) | |
| The Dunedin Pub Company VCT Limited | Owner and operator of freehold pubs | 7.8 | 50.0 | 87 | 81 | 87 | 82 | (1) | |
| GB Pub Company VCT Limited | Owner and operator of freehold pubs | 9.0 | 50.0 | 364 | 80 | 364 | 97 | (17) | |
| CS (Norwich) Limited | Cinema owner and operator | 3.8 | 50.0 | 60 | 74 | 60 | 63 | 11 | |
| Avesi Limited | PV Installations on small commercial buildings | 2.1 | 50.0 | 17 | 17 | 17 | 17 | - | |
| Total qualifying unquoted asset- backed investments | 17,629 | 14,360 | 16,441 | 13,032 | 140 | ||||
| As at 31 December 2011 (unaudited) | As at 30 June 2011 (audited) | |||||||
| Investment name | Nature of business | % voting rights | % voting rights of AVL* managed companies | Investment to date at cost £'000 | Total value £'000 | Investment to date at cost £'000 | Total value** £'000 | Change in total value for the period** £'000 |
| Qualifying unquoted growth investments | ||||||||
| ELE Advanced Technologies Limited | Manufacturer of precision engineering components | 48.3 | 48.3 | 1,050 | 2,302 | 1,050 | 2,263 | 39 |
| Lowcosttravelgroup Limited | Online travel business | 5.0 | 26.0 | 455 | 671 | 455 | 423 | 249 |
| Blackbay Limited | Provider of mobile data solutions for the logistics and field service sectors | 4.1 | 34.9 | 454 | 589 | 458 | 590 | 4 |
| Helveta Limited | Provider of software solutions, traceability and inventory analysis to the timber industry | 3.1 | 20.8 | 797 | 475 | 488 | 444 | (279) |
| Prime Care Holdings Limited | Provider of domiciliary Care services | 8.7 | 49.9 | 517 | 447 | 517 | 461 | (14) |
| House of Dorchester Limited | Chocolate manufacturer | 23.3 | 23.3 | 245 | 398 | 327 | 446 | 34 |
| Masters Pharmaceuticals Limited | International specialist distribution of pharmaceuticals | 2.4 | 16.9 | 474 | 372 | 474 | 465 | (93) |
| Mirada Medical Limited | Developer of medical imaging software | 7.7 | 50.0 | 179 | 363 | 179 | 347 | 16 |
| Hilson Moran Holdings Limited | Multi-disciplinary engineering consultancy | 4.5 | 50.0 | 360 | 360 | - | - | - |
| Mi-Pay Limited | Provider of mobile payment services | 3.9 | 49.9 | 483 | 328 | 387 | 328 | (96) |
| Rostima Limited | Provider of workforce management solutions software | 5.5 | 39.3 | 136 | 274 | 108 | 169 | 76 |
| DySIS Medical Limited | Developer, manufacturer and seller of medical devices for the detection of epithelial cancers | 2.7 | 19.0 | 423 | 233 | 350 | 283 | (123) |
| Opta Sports Data Limited | Compiler of sports performance data | 1.4 | 14.2 | 176 | 181 | 176 | 159 | 21 |
| Process Systems Enterprise Limited | Provider of process systems modelling solutions | 1.1 | 15.9 | 100 | 134 | 100 | 124 | 9 |
| Memsstar Limited | Refurbisher of semiconductor fabrication equipment | 1.9 | 28.1 | 130 | 130 | 130 | 149 | (19) |
| Palm Tree Technology PLC | Software company | 0.2 | 0.7 | 102 | 123 | 102 | 61 | 62 |
| Chichester Holdings Limited | Drinks distributor to the travel sector | 9.1 | 50.0 | 600 | 120 | 600 | 96 | 24 |
| Oxsensis Limited | Developer and producer of industrial sensors used in super- high temperature environments | 1.4 | 20.6 | 192 | 109 | 192 | 109 | - |
| Xceleron Limited | Provider of a range of drug development services to the life- science industries | 3.3 | 45.1 | 382 | 84 | 382 | 235 | (151) |
| Uctal Limited | Media selling business & TV production company | 24.2 | 24.2 | 1,494 | 50 | 1,494 | 50 | - |
| Abcodia Limited | Services for validation and discovery of serum biomarkers | 1.3 | 21.4 | 45 | 45 | 45 | 45 | - |
| Evolutions Television Limited | Provider of TV post production services | 0.0 | 0.0 | 1 | 1 | 26 | 3 | 22 |
| Red-M Wireless Limited | Service and software provider | 11.8 | 42.1 | 85 | - | 85 | 19 | (19) |
| Investments exited in the period | - | - | 38 | 19 | - | |||
| 8,880 | 7,789 | 8,163 | 7,288 | (238) | ||||
| Other investments valued at nil | 129 | - | 129 | - | - | |||
| Total qualifying unquoted growth investments | 9,009 | 7,789 | 8,292 | 7,288 | (238) | |||
| Total qualifying unquoted investments | 26,638 | 22,149 | 24,733 | 20,320 | (98) | |||
| At 31 December 2011 (unaudited) | At 30 June 2011 (audited) | |||||||
| Investment name | Nature of business | % voting rights | voting rights of AVL* managed companies | Investment to date at cost £'000 | Total value £'000 | Investment to date at cost £'000 | Total value £'000 | Change in total value for the period** £'000 |
| Qualifying AIM quoted investments | ||||||||
| Avanti Communications Group plc | Supplier of satellite communications | 0.2% | 0.2% | 371 | 516 | 371 | 661 | (145) |
| Augean PLC | Waste management | 0.4% | 0.4% | 590 | 94 | 590 | 102 | (8) |
| Insetco plc | Investor in businesses that specialise in financial products | 0.0% | 0.0% | 81 | - | 81 | - | - |
| Total qualifying AIM quoted investments | 1,042 | 610 | 1,042 | 763 | (153) | |||
| Total qualifying investments | 27,680 | 22,759 | 25,775 | 21,083 | (251) | |||
| At 31 December 2011 (unaudited) | At 30 June 2011 (audited) | |||||||
| Investment name | Nature of business | % voting rights | voting rights of AVL* managed companies | Investment to date at cost £'000 | Total value £'000 | Investment to date at cost £'000 | Total value £'000 | Change in total value for the period** £'000 |
| Non-qualifying unquoted investments | ||||||||
| Evolutions Group Limited | Own and lease commercial property | 0.7 | 100.0 | 8 | 2 | 43 | 33 | 4 |
| Investments exited in the period | - | - | 48 | 48 | - | |||
| 8 | 2 | 91 | 81 | 4 | ||||
| Non-qualifying AIM quoted investments | 7 | 6 | 8 | 8 | (2) | |||
| Total non-qualifying investments | 15 | 8 | 99 | 89 | 2 | |||
| Total non-current asset investments | 27,695 | 22,767 | 25,874 | 21,172 | (249) | |||
| As at 31 December 2011 (unaudited) | ||
| Investment to date at cost £'000 | Total value £'000 | |
| Current asset investments | ||
| Dexela Limited | - | 68 |
| RFI Global Services Limited | - | 28 |
| Total non-qualifying investments | - | 96 |
* AVL is Albion Ventures LLP
** As adjusted for additions and disposals between the two accounting periods
Summary consolidated statement of comprehensive income
| Unaudited | Unaudited | Audited | ||||||||||
| six months ended 31 December 2011 | six months ended 31 December 2010 | year ended 30 June 2011 | ||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | Revenue | Capital | Total | ||||
| Notes | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||
| (Losses)/profits on investments | 2 | - | (181) | (181) | - | 1,298 | 1,298 | - | 1,089 | 1,089 | ||
| Investment income and deposit interest | 3 | 476 | - | 476 | 461 | - | 461 | 1,157 | - | 1,157 | ||
| Investment management fees | (55) | (167) | (222) | (54) | (163) | (217) | (109) | (327) | (436) | |||
| Recovery of VAT | 4 | 96 | 261 | 357 | - | - | - | - | - | - | ||
| Other expenses | (119) | - | (119) | (132) | - | (132) | (236) | - | (236) | |||
| Profit/(loss) before taxation | 398 | (87) | 311 | 275 | 1,135 | 1,410 | 812 | 762 | 1,574 | |||
| Taxation | - | - | - | - | - | - | - | - | - | |||
| Profit/(loss) and total comprehensive income for the period | 398 | (87) | 311 | 275 | 1,135 | 1,410 | 812 | 762 | 1,574 | |||
| Basic and diluted return/(loss) per Ordinary share (pence)* | 6 | 0.52 | (0.11) | 0.41 | 0.38 | 1.58 | 1.96 | 1.11 | 1.04 | 2.15 | ||
* (excluding treasury shares)
Comparative figures have been extracted from the unaudited Half-yearly Financial Report for the six months ended 31 December 2010 and the audited statutory accounts for the year ended 30 June 2011.
The accompanying notes form an integral part of this Half-yearly Financial Report.
The total column of this statement represents the Group's Statement of comprehensive income, prepared in accordance with International Financial Reporting Standards ('IFRS'). The supplementary revenue and capital reserve columns are prepared under guidance published by the Association of Investment Companies.
All revenue and capital items in the above statement derive from continuing operations and are wholly attributable to the parent company.
Summary consolidated statement of financial position
| Unaudited | Audited | ||
| 31 December 2011 | 30 June 2011 | ||
| Notes | £'000 | £'000 | |
| Non-current assets | |||
| Investments | 7 | 22,767 | 21,172 |
| Current assets | |||
| Trade and other receivables less than one year | 63 | 102 | |
| Current asset investments | 96 | - | |
| Cash and cash equivalents | 2,061 | 4,550 | |
| 2,220 | 4,652 | ||
| Total assets | 24,987 | 25,824 | |
| Current liabilities | |||
| Trade and other payables | (180) | (243) | |
| Non-current assets | |||
| Trade and other receivables greater than one year | - | 80 | |
| Net assets | 24,807 | 25,661 | |
| Equity attributable to equity holders | |||
| Ordinary share capital | 8 | 8,365 | 8,350 |
| Share premium | 1,289 | 1,259 | |
| Capital redemption reserve | 1,058 | 1,058 | |
| Unrealised capital reserve | (4,883) | (4,712) | |
| Treasury shares reserve | (3,105) | (2,849) | |
| Realised capital reserve | 2,544 | 2,460 | |
| Revenue reserve | 19,539 | 20,095 | |
| Total equity shareholders' funds | 24,807 | 25,661 | |
| Basic and diluted net asset value per share (pence)* | 32.86 | 33.65 |
* (excluding treasury shares)
Comparative figures have been extracted from the audited statutory accounts for the year ended 30 June 2011.
The accompanying notes form an integral part of this Half-yearly Financial Report.
These Financial Statements were agreed by the Board of Directors, and authorised for issue on 27 February 2012 and were signed on its behalf by
Patrick Crosthwaite
Chairman
Company number 3495287
Summary Company statement of financial position
| Unaudited | Audited | ||
| 31 December 2011 | 30 June 2011 | ||
| Notes | £'000 | £'000 | |
| Fixed assets | |||
| Fixed asset investments | 7 | 22,767 | 21,172 |
| Investment in subsidiary undertakings | 17,661 | 16,444 | |
| 40,428 | 37,616 | ||
| Current assets | |||
| Trade and other debtors less than one year | 63 | 102 | |
| Current asset investments | 96 | - | |
| Cash at bank and in hand | 1,664 | 4,257 | |
| 1,823 | 4,359 | ||
| Total assets | 42,251 | 41,975 | |
| Creditors: amounts falling due within one year | (17,444) | (16,394) | |
| Non-current assets | |||
| Trade and other debtors greater than one year | - | 80 | |
| Net assets | 24,807 | 25,661 | |
| Equity attributable to equityholders | |||
| Ordinary share capital | 8 | 8,365 | 8,350 |
| Share premium | 1,289 | 1,259 | |
| Capital redemption reserve | 1,058 | 1,058 | |
| Unrealised capital reserve | (2,281) | (3,325) | |
| Treasury shares reserve | (3,105) | (2,849) | |
| Realised capital reserve | 2,336 | 2,407 | |
| Revenue reserve | 17,145 | 18,761 | |
| Total equity shareholders' funds | 24,807 | 25,661 | |
| Basic and diluted net asset value per share (pence)* | 32.86 | 33.65 |
* (excluding treasury shares)
Comparative figures have been extracted from the statutory accounts for the year ended 30 June 2011.
The accompanying notes form an integral part of this Half-yearly Financial Report.
These Financial Statements were approved by the Board of Directors, and authorised for issue on 27 February 2012 and were signed on its behalf by
Patrick Crosthwaite
Chairman
Company number 3495287
Summary consolidated statement of changes in equity
| Ordinary share capital £'000 | Share premium £'000 | Capital redemption reserve £'000 | Unrealised capital reserve* £'000 | Special reserve* £'000 | Treasury shares reserve* £'000 | Realised capital reserve* £'000 | Revenue reserve* £'000 | Total £'000 | |
| As at 1 July 2011 (audited) | 8,350 | 1,259 | 1,058 | (4,712) | - | (2,849) | 2,460 | 20,095 | 25,661 |
| Total comprehensive income for the period | - | - | - | (181) | - | - | 94 | 398 | 311 |
| Transfer of previously unrealised losses on sale of investment | - | - | - | 10 | - | - | (10) | - | - |
| Dividends paid in the period | - | - | - | - | - | - | - | (953) | (953) |
| Purchase of own shares for treasury (net of costs) | - | - | - | - | - | (256) | - | - | (256) |
| Issue of equity (net of costs) | 15 | 30 | - | - | - | - | - | - | 45 |
| As at 31 December 2011 (unaudited) | 8,365 | 1,289 | 1,058 | (4,883) | - | (3,105) | 2,544 | 19,539 | 24,807 |
| As at 1 July 2010 (audited) | 7,918 | 32 | 972 | (5,966) | 46,318 | (2,849) | (23,165) | 1,153 | 24,413 |
| Total comprehensive income for the period | - | - | - | 1,199 | - | - | (64) | 275 | 1,410 |
| Transfer of previously unrealised losses on sale of investments | - | - | - | 286 | - | - | (286) | - | - |
| Dividends paid in period | - | - | - | - | - | - | - | (899) | (899) |
| Purchase of own shares for cancellation (net of costs) | (34) | - | 34 | - | (98) | - | - | - | (98) |
| Issue of equity (net of costs) | 11 | 26 | - | - | - | - | - | - | 37 |
| As at 31 December 2010 (unaudited) | 7,895 | 58 | 1,006 | (4,481) | 46,220 | (2,849) | (23,515) | 529 | 24,863 |
| As at 1 July 2010 (audited) | 7,918 | 32 | 972 | (5,966) | 46,318 | (2,849) | (23,165) | 1,153 | 24,413 |
| Profit and total comprehensive income for the year | - | - | - | 218 | - | - | 544 | 812 | 1,574 |
| Transfer of previously unrealised losses on sale of investments | - | - | - | 1,036 | - | - | (1,036) | - | - |
| Dividends paid in year | - | - | - | - | - | - | - | (1,819) | (1,819) |
| Purchase of own shares for cancellation (including costs) | (86) | - | 86 | - | (252) | - | - | - | (252) |
| Issue of equity (net of costs) | 518 | 1,227 | - | - | - | - | - | - | 1,745 |
| Transfer from special reserve to revenue reserve | - | - | - | - | (19,949) | - | - | 19,949 | - |
| Transfer from revenue reserve to realised capital reserve | - | - | - | - | (26,117) | - | 26,117 | - | - |
| As at 30 June 2011 (audited) | 8,350 | 1,259 | 1,058 | (4,712) | - | (2,849) | 2,460 | 20,095 | 25,661 |
* Included within these reserves is an amount of £14,095,000 (December 2010: £15,904,000; June 2011: £14,994,000) which is distributable. The special reserve has been treated as distributable in determining the reserves available for distribution.
Summary Company reconciliation of movements in shareholders' funds
| Ordinary share capital £'000 | Share premium £'000 | Capital redemption reserve £'000 | Unrealised capital reserve* £'000 | Special reserve* £'000 | Treasury shares reserve* £'000 | Realised capital reserve* £'000 | Revenue reserve* £'000 | Total £'000 | |
| As at 1 July 2011 (audited) | 8,350 | 1,259 | 1,058 | (3,325) | - | (2,849) | 2,407 | 18,761 | 25,661 |
| Return for the period | - | - | - | 1,034 | - | - | (62) | (663) | 309 |
| Transfer of previously unrealised losses on sale of investment | - | - | - | 10 | - | - | (10) | - | - |
| Dividends paid in year | - | - | - | - | - | - | - | (953) | (953) |
| Purchase of own shares for treasury (including costs) | - | - | - | - | - | (256) | - | - | (256) |
| Issue of equity (net of costs) | 15 | 30 | - | - | - | - | - | - | 45 |
| As at 31 December 2011 (unaudited) | 8,365 | 1,289 | 1,058 | (2,281) | - | (3,105) | 2,336 | 17,145 | 24,807 |
| As at 1 July 2010 (audited) | 7,918 | 32 | 972 | (6,011) | 46,318 | (2,849) | (23,218) | 1,251 | 24,413 |
| Return for the period | - | - | - | 1,678 | - | - | (64) | (204) | 1,410 |
| Transfer of previously unrealised losses on sale of investments | - | - | - | 286 | - | - | (286) | - | - |
| Dividends paid in period | - | - | - | - | - | - | - | (899) | (899) |
| Purchase of own shares for cancellation (including costs) | (34) | - | 34 | - | (98) | - | - | - | (98) |
| Issue of equity (net of costs) | 11 | 26 | - | - | - | - | - | - | 37 |
| As at 31 December 2010 (unaudited) | 7,895 | 58 | 1,006 | (4,047) | 46,220 | (2,849) | (23,568) | 148 | 24,863 |
| As at 1 July 2010 (audited) | 7,918 | 32 | 972 | (6,011) | 46,318 | (2,849) | (23,218) | 1,251 | 24,413 |
| Return for the year | - | - | - | 1,650 | - | - | 544 | (620) | 1,574 |
| Transfer of previously unrealised losses on sale of investments | - | - | - | 1,036 | - | - | (1,036) | - | - |
| Dividends paid in year | - | - | - | - | - | - | - | (1,819) | (1,819) |
| Purchase of own shares for cancellation (including costs) | (86) | - | 86 | - | (252) | - | - | - | (252) |
| Issue of equity (net of costs) | 518 | 1,227 | - | - | - | - | - | - | 1,745 |
| Transfer from special reserve to revenue reserve | - | - | - | - | (19,949) | - | - | 19,949 | - |
| Transfer from special reserve to realised capital reserve | - | - | - | - | (26,117) | - | 26,117 | - | - |
| As at 30 June 2011 (audited) | 8,350 | 1,259 | 1,058 | (3,325) | - | (2,849) | 2,407 | 18,761 | 25,661 |
* Included within these reserves is an amount of £14,095,000 (December 2010: £15,904,000; June 2011: £14,994,000) which is distributable. The special reserve has been treated as distributable in determining the reserves available for distribution.
Summary consolidated statement of cash flows
| Note | Unaudited Six months ended 31 December 2011 £'000 | Unaudited Six months ended 31 December 2010 £'000 | Audited Year ended 30 June 2011 £'000 | |
| Operating activities | ||||
| Investment income received | 412 | 435 | 945 | |
| Deposit interest received | 26 | 33 | 56 | |
| Dividend income received | - | - | 287 | |
| Administration fees paid | (26) | (25) | - | |
| Recovery of VAT | 357 | - | - | |
| Investment management fees paid | (223) | (221) | (431) | |
| Other cash payments | (130) | (103) | (256) | |
| Cash generated by operations | 416 | 119 | 601 | |
| Taxation | ||||
| Tax received | - | - | - | |
| Net cash flows from operating activities | 9 | 416 | 119 | 601 |
| Cash flows from investing activities | ||||
| Purchase of non-current asset investments | (2,096) | (2,672) | (4,126) | |
| Disposal of non-current asset investments | 354 | 1,896 | 2,898 | |
| Net cash flow from investing activities | (1,742) | (776) | (1,228) | |
| Cash flows from financing activities | ||||
| Equity dividends paid (net of costs of issuing shares under dividend reinvestment scheme) | (907) | (861) | (1,743) | |
| Issue of share capital (net of issue costs) | - | - | 1,671 | |
| Purchase of Ordinary shares for cancellation | - | (109) | (264) | |
| Purchase of Ordinary shares for treasury | (256) | - | - | |
| Net cash flows used in financing activities | (1,163) | (970) | (336) | |
| (Decrease)/increase in cash and cash equivalents | (2,489) | (1,627) | (963) | |
| Cash and cash equivalents at the start of the period | 4,550 | 5,513 | 5,513 | |
| Cash and cash equivalents at the end of the period | 2,061 | 3,886 | 4,550 |
Notes to the summarised set of Financial Statements for the six months ended 31 December 2011
1. Accounting policies
The following policies refer to the Group and the Company except where noted. References to International Financial Reporting Standards ('IFRS') relate to the Group Financial Statements and Financial Reporting Standards ('FRS') relate to the Company Financial Statements.
Basis of accounting
The Half-yearly Financial Report has been prepared in accordance with the historical cost convention, modified to include the revaluation of investments and in accordance with International Financial Reporting Standards ('IFRS') adopted for use in the European Union (and therefore comply with Article 4 of the EU IAS regulation), in the case of the Group, and in accordance with Financial Reporting Standards ('FRS') in the case of the Company. This Half-Yearly Financial Report has been prepared in accordance with IAS 34 'Interim Financial Reporting'.
Both the Group and the Company financial statements also apply the Statement of Recommended Practice: "Financial Statements of Investment Companies and Venture Capital Trusts" ('SORP') issued by the Association of Investment Companies ("AIC") in January 2009, in so far as this does not conflict with IFRS. The Financial Statements have been prepared in accordance with those parts of the Companies Act 2006 applicable to the companies reporting under IFRS and FRS. The information in this document does not include all of the disclosures required by IFRS and SORP in full annual Financial Statements, and it should be read in conjunction with the consolidated Financial Statements of the Group for the year ended 30 June 2011. This Half-yearly financial information has been prepared applying the accounting policies and presentation that were applied in the preparation of the Group's published consolidated Financial Statements for the year ended 30 June 2011.
These financial statements are presented in Sterling to the nearest thousand. Accounting policies have been applied consistently in current and prior periods.
Basis of consolidation
The Group consolidated financial statements incorporate the financial statements of the Company for the period ended 31 December 2011 and the entities controlled by the Company (its subsidiaries), for the same period. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies into line with those used by the Group. All intra-group transactions, balances, income and expenses are eliminated on consolidation.
As permitted by Section 408 of the Companies Act 2006, the Company has not presented its own profit and loss account. The amount of the Company's profit before tax for the period dealt with in the accounts of the Group is £309,000 (31 December 2010: £1,410,000; 30 June 2011: £1,574,000).
Segmental reporting
The Directors are of the opinion that the Group and the Company are engaged in a single segment of business, being investment business. The Group invests in smaller companies principally based in the UK.
Business combinations
The acquisition of subsidiaries is accounted for using the purchase method in the Group financial statements. The cost of the acquisition is measured at the aggregate of the fair values, at the date of exchange, of assets given, liabilities incurred or assumed, and equity instruments issued by the Group in exchange for control of the subsidiaries, plus any costs directly attributable to the business combination. The subsidiary's identifiable assets, liabilities and contingent liabilities that meet the conditions for recognition under IFRS 3 "Business Combinations" are recognised at their fair value at the acquisition date.
Estimates
The preparation of the Group and Company's Half-yearly Financial Report requires estimates, assumptions and judgements to be made, which affect the reported results and balances. Actual outcomes may differ from these estimates, with a consequential impact on the results of future periods. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are those used to determine the fair value of investments at fair value through profit or loss.
The valuation of investments at fair value through the profit or loss is determined by using valuation techniques. The Group and the Company use judgements to select a variety of methods and makes assumptions that are mainly based on market conditions at each balance sheet date. The movements in valuations of investments during the period are shown in note 2.
Fixed and current asset investments
Quoted and unquoted equity investments, debt issued at a discount and convertible bonds
In accordance with IAS 39 'Financial Instruments: Recognition and Measurement', and FRS 26 'Financial Instruments: Recognition and Measurement', quoted and unquoted equity, debt issued at a discount and convertible bonds are designated as fair value through profit or loss ('FVTPL'). Investments listed on recognised exchanges are valued at the closing bid prices at the end of the accounting period. Unquoted investments' fair value is determined by the Directors in accordance with the International Private Equity and Venture Capital Valuation Guidelines (IPEVCV guidelines).
Desk top reviews are carried out by independent RICS qualified surveyors by updating previously prepared full valuations for current trading and market indices. Full valuations are prepared by similarly qualified surveyors but in full compliance with the RICS Red Book.
Fair value movements on equity investments and gains and losses arising on the disposal of investments are reflected in the capital column of the Statement of comprehensive income in accordance with the AIC SORP. Realised gains or losses on the sale of investments will be reflected in the realised capital reserve, and unrealised gains or losses arising from the revaluation of investments will be reflected in the unrealised capital reserve.
Warrants and unquoted equity derived instruments
Warrants and unquoted equity derived instruments are only valued if their exercise or contractual conversion terms would allow them to be exercised or converted as at the balance sheet date, and if there is additional value to the Company in exercising or converting as at the balance sheet date. Otherwise these instruments are held at nil value. The valuation techniques used are those used for the underlying equity investment.
Unquoted loan stock
Unquoted loan stock (excluding convertible bonds and debt issued at a discount) is classified as loans and receivables in accordance with IAS 39 and FRS 26 and carried at amortised cost using the Effective Interest Rate method less impairment. Movements in the amortised cost relating to interest income are reflected in the revenue column of the Statement of comprehensive income, and hence are reflected in the revenue reserve, and movements in respect of capital provisions are reflected in the capital column of the Statement of comprehensive income and are reflected in the realised capital reserve following sale, or in the unrealised capital reserve on revaluation.
For all unquoted loan stock, fully performing, renegotiated, past due or impaired, the Board considers that the fair value is equal to or greater than the security value of these assets. For unquoted loan stock, the amount of the impairment is the difference between the asset's cost and the present value of estimated future cash flows, discounted at the effective interest rate. The future cash flows are estimated based on the fair value of the security held less estimated selling costs.
Current asset investments
Contractual future contingent receipts and disposal of fixed asset investments are designated at fair value through profit and loss and are subsequently measured at fair value.
Investments are recognised as financial assets on legal completion of the investment contract and are de-recognised on legal completion of the sale of an investment.
Dividend income is not recognised as part of the fair value movement of an investment, but is recognised separately as investment income through the revenue reserve when a share becomes ex-dividend.
Loan stock accrued interest is recognised in the Balance sheet as part of the carrying value of the loans and receivables at the end of each reporting period.
It is not the Group or the Company's policy to exercise control or significant influence over investee companies. Therefore in accordance with the exemptions under IAS 28 "Investments in associates" and FRS 9 "Associates and joint ventures", those undertakings in which the Group or Company holds more than 20 per cent. of the equity are not regarded as associated undertakings.
Investment income
Quoted and unquoted equity income
Dividend income is included in revenue when the investment is quoted ex-dividend.
Unquoted loan stock income
Fixed returns on non-equity shares and debt securities are recognised on a time apportionment basis using an effective interest rate over the life of the financial instrument. Income which is not capable of being received within a reasonable period of time is reflected in the capital value of the investment.
Bank interest income
Interest income is recognised on an accruals basis using the rate of interest agreed with the bank.
Investment management fees, performance incentive fees and other expenses
All expenses have been accounted for on an accruals basis. Expenses are charged through the revenue column of the Statement of comprehensive income, except for management fees and performance incentive fees which are allocated in part to the capital column of the Statement of comprehensive income, to the extent that these relate to an enhancement in the value of the investments and in line with the Board's expectation that over the long term 75 per cent. of the Group's investment returns will be in the form of capital gains.
Issue costs
Issue costs associated with the allotment of share capital have been deducted from the share premium account.
Taxation
Taxation is applied on a current basis in accordance with IAS 12 and FRS 16 "Income taxes". Taxation associated with capital expenses is applied in accordance with the SORP. Deferred taxation is provided in full on temporary differences in accordance with IAS 12 and timing differences in accordance with FRS 16, that result in an obligation at the balance sheet date to pay more tax or a right to pay less tax, at a future date, at rates expected to apply when they crystallise based on current tax rates and law. Timing differences arise from the inclusion of items of income and expenditure in taxation computations in periods different from those in which they are included in the Financial Statements. Temporary differences arise from differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax assets are recognised to the extent that it is probable that future taxable profit will be available against which unused tax losses and credits can be utilised.
Dividends
In accordance with IAS 10 and FRS 21 "Events after the balance sheet date", dividends are accounted for in the period in which the dividend has been paid or approved by shareholders.
Reserves
Share premium
This reserve accounts for the difference between the price paid for shares and the nominal value of the shares, less issue costs and transfers to the special reserve.
Capital redemption reserve
This reserve accounts for amounts by which the issued share capital is diminished through the repurchase and cancellation of the Company's own shares.
Unrealised capital reserve
Increases and decreases in the valuation of investments held at the year end, against cost are included in this reserve.
Special reserve
The cancellation of the share premium account has created a special reserve that can be used to fund market purchases and subsequent cancellation of own shares, to cover gross realised losses, and for other distributable purposes.
Treasury shares reserve
This reserve accounts for amounts by which the Company's distributable reserves are diminished through the repurchase of the Company's own shares for treasury purposes.
Realised capital reserve
The following are disclosed in this reserve:
· gains and losses compared to cost on the realisation of investments;
· expenses, together with the related taxation effect, charged in accordance with the above policies; and
· capital dividends paid to equity holders.
2. (Losses)/profits on investments
| Unaudited Six months ended 31 December 2011 £'000 | Unaudited Six months ended 31 December 2010 £'000 | Audited Year ended 30 June 2011 £'000 | |
| Unrealised (losses)/gains on non-current asset investments held at fair value through profit and loss account | (192) | 1,043 | (10) |
| Unrealised (impairments)/gains on non-current asset investments held at amortised cost | (85) | 155 | 228 |
| Unrealised (losses)/gains on fixed asset investments | (277) | 1,198 | 218 |
| Unrealised gains on current asset investments held at fair value through profit or loss account | 96 | - | - |
| Unrealised (losses)/gains sub-total | (181) | 1,198 | 218 |
| Realised gains on non-current asset investments held at fair value through profit and loss account | 13 | 94 | 587 |
| Realised gains on non-current asset investments held at amortised cost | 13 | 6 | 284 |
| Realised (losses) on current asset investments held at fair value through profit and loss account | (26) | - | - |
| Realised gains sub-total | - | 100 | 871 |
| (181) | 1,298 | 1,089 |
Investments valued on an amortised cost basis are unquoted loan stock investments.
3. Investment income and deposit interest
| Unaudited Six months ended 31 December 2011 £'000 | Unaudited Six months ended 31 December 2010 £'000 | Audited Year ended 30 June 2011 £'000 | |
| Income recognised on investments held at fair value through profit and loss | |||
| UK dividend income | - | 38 | 287 |
| Interest on convertible bonds and debt issued at a discount | 13 | - | 18 |
| - | 38 | 305 | |
| Income recognised on investments held at amortised cost | |||
| Return on loan stock investments | 439 | 393 | 795 |
| Bank deposit interest | 24 | 30 | 57 |
| 463 | 423 | 852 | |
| 476 | 461 | 1,157 |
4. Recovery of VAT
The Company has received a repayment in respect of historic VAT from the previous manager, Murray Johnstone Limited. A sum of £357,000 has been recognised as a separate item in the Summary consolidated statement of comprehensive income, allocated between revenue and capital in the same proportion as the original VAT was charged.
5. Dividends
| Unaudited Six months ended 31 December 2011 £'000 | Unaudited Six months ended 31 December 2010 £'000 | Audited Year ended 30 June 2011 £'000 | |
| First dividend paid on 30 November 2010 (1.25 pence per share) | - | 899 | 899 |
| Second dividend paid on 31 March 2011 (1.25 pence per share) | - | - | 920 |
| First dividend paid on 30 November 2011 (1.25 pence per share) | 953 | - | - |
| 953 | 899 | 1,819 | |
In addition, the Board has declared a second dividend of 1.25 pence per share. This will be paid on 30 March 2012 to shareholders on the register as at 9 March 2012. This is expected to amount to approximately £959,000.
6. Basic and diluted return per share
| Unaudited Six months ended 31 December 2011 | Unaudited Six months ended 31 December 2010 | Audited Year ended 30 June 2011 | |||||||
| Revenue | Capital | Total | Revenue | Capital | Total | Revenue | Capital | Total | |
| Return/(loss) attributable to equity shares (£'000) | 398 | (87) | 311 | 275 | 1,135 | 1,410 | 812 | 762 | 1,574 |
| Weighted average shares in issue (excluding Treasury shares) | 76,050,536 | 71,865,819 | 73,413,178 | ||||||
| Return/(loss) attributable per Ordinary share (pence) (basic and diluted) | 0.52 | (0.11) | 0.41 | 0.38 | 1.58 | 1.96 | 1.11 | 1.04 | 2.15 |
The return per share has been calculated excluding treasury shares of 8,151,410 (31 December 2010: 7,260,410; 30 June 2011: 7,260,410).
There are no convertible instruments, derivatives or contingent share agreements in issue, and therefore no dilution affecting the return per share. The basic return per share is therefore the same as the diluted return per share.
7. Non-current asset investments
| Unaudited 31 December 2011 £'000 | Audited 30 June 2011 £'000 | |
| Investments held at fair value through profit or loss | 8,208 | 8,751 |
| Investments measured at amortised cost | 14,559 | 12,421 |
| 22,767 | 21,172 |
8. Ordinary share capital
| Unaudited 31 December 2010 £'000 | Audited 30 June 2010 £'000 | |
| Allotted, called up and fully paid | ||
| 83,654,818 Ordinary shares of 10p each (30 June 2011: 83,509,177) | 8,365 | 8,350 |
| Voting rights | ||
| 75,503,408 Ordinary shares of 10p each (30 June 2011: 76,248,767) |
The Company did not purchase any shares for cancellation during the period (year ended 30 June 2011: 861,875 shares at a cost of £252,000; six months ended 31 December 2010: 332,000 shares at a cost of £97,000).
The Company purchased 891,000 shares for treasury at a cost of £256,000 (year ended 30 June 2011: nil shares, six months ended 31 December 2010: nil shares) during the period. (The total number of shares held in treasury as at 31 December 2011 was 8,151,410 (30 June 2011: 7,260,410).
Under the terms of the Dividend Reinvestment Scheme, the following Ordinary shares of nominal value 10 pence were allotted during the period:
| Allotment date | Number of shares allotted | Aggregate nominal value of shares £'000 | Issue price per share pence per share | Net consideration received £'000 | Opening market price per share on allotment pence per share |
| 30 November 2011 | 145,641 | 15 | 31.70 | 45 | 30.00 |
9. Reconciliation of revenue return on ordinary activities before taxation to net cashflow from operating activities
| Unaudited Six months ended 31 December 2011 £'000 | Unaudited Six months ended 31 December 2010 £'000 | Audited Year ended 30 June 2011 £'000 | |
| Revenue return before tax | 398 | 275 | 812 |
| Capitalised expenses | 94 | (163) | (327) |
| (Increase)/decrease in accrued amortised loan stock interest | (40) | (54) | 132 |
| (Increase)/decrease in receivables | 14 | (13) | (3) |
| Increase/(decrease) in payables | (50) | 74 | (13) |
| Net cash flow from operating activities | 416 | 119 | 601 |
10. Contingencies and guarantees
There are no external contingencies for or guarantees by the Group or Company as at 31 December 2011 (31 December 2010: nil; 30 June 2011: nil).
As at 31 December 2011 Crown Place VCT PLC had the following financial commitments:
· £43,000 to Mi-Pay Limited
· £120,000 to Helveta Limited
Under the terms of the Transfer Agreement date 16 January 2006, Crown Place VCT PLC has indemnified its subsidiaries, CP1 VCT PLC and CP2 VCT PLC in respect of all costs, claims and liabilities in exchange for the transfer of assets.
11. Post Balance Sheet Events
Albion VCTs Linked Top Up Offer 2011/2012
On 1 November 2011 the Company announced the launch of the Albion VCTs Linked Top Up Offer 2011/2012. In aggregate, the Albion VCTs will be aiming to raise up to £15 million across seven of the VCTs managed by Albion Ventures LLP, of which Crown Place VCT PLC's share will be approximately £2.25 million. The maximum amount raised by each of the Albion VCTs will be 10 per cent. of its issued share capital (over any one 12 month period, and including any shares issued under Dividend Reinvestment Schemes), being the amount that they may issue under the Prospectus Rules without the publication of a full prospectus.
The proceeds of the Offer will be used to provide further resources to the Albion VCTs at a time when a number of attractive new investment opportunities are being seen. An Investor Guide and Offer document have been sent to shareholders.
The following Ordinary shares of nominal value 50 pence per share were allotted under the Offer since the year end:
| Date of allotment | Number of shares allotted | Aggregate nominal value of shares (£'000) | Issue price (pence per share) | Net consideration received (£'000) | Opening market price per share on allotment date (pence per share) |
| 10 January 2012 | 1,191,601 | 119 | 33.5 | 378 | 27.5 |
12. Related party transactions
The Manager, Albion Ventures LLP, could be considered to be a related party by virtue of the fact that it is party to a management agreement from the Company. During the period, services of a total value of £245,000 (six months ended 31 December 2010: £242,000; year ended 30 June 2011: £486,000) were purchased by the Company from Albion Ventures LLP; this includes £220,000 management fee and £25,000 administration fee. At the financial period end, the amount due to Albion Ventures LLP disclosed as payables was £123,000 (administration fee accrual £13,000, management fee accrual £110,000) (31 December 2010: £122,000; 30 June 2011: £124,000).
Albion Ventures LLP, the Manager, holds 1,256 Ordinary shares as a result of the fractional entitlement arising on the merger of Crown Place VCT PLC, CP1 VCT PLC and CP2 VCT PLC on 13 January 2006.
13. Risks and uncertainties
The Board considers that the Company faces the following major risks and uncertainties:
1. Investment risk
This is the risk of investment in poor quality assets which reduce the capital and income returns to shareholders, and negatively impacts on the Company's reputation. By nature, smaller unquoted businesses, such as those that qualify for venture capital trust purposes are more fragile than larger, long established businesses.
To reduce this risk, the Board places reliance upon the skills and expertise of the Manager and their strong track record for investing in this segment of the market. The Company's policy is to lower investment risk by investing part of the portfolio in asset-based businesses and taking a first charge over the relevant assets. In addition, the Manager operates a formal and structured investment process, which includes an Investment Committee, comprising investment professionals from the Manager and at least one external investment professional. The Manager also invites comments from non-executive Directors of the Company on investments discussed at the Investment Committee meetings. Investments are actively and regularly monitored by the Manager (investment managers normally sit on investee company boards) and the Board receives detailed reports on each investment as part of the Manager's report at quarterly board meetings.
2. Venture Capital Trust approval risk
The Company's current approval as a venture capital trust allows investors to take advantage of tax reliefs on initial investment and ongoing tax free capital gains and dividend income. Failure to meet the qualifying requirements could result in investors losing the tax relief on initial investment and loss of tax relief on any tax-free income or capital gains received. In addition, failure to meet the qualifying requirements could result in a loss of listing of the shares.
To reduce this risk, the Board has appointed the Manager, who has a team with significant experience in venture capital trust management, and is used to operating within the requirements of the venture capital trust legislation. In addition, to provide further formal reassurance, the Board has appointed PricewaterhouseCoopers LLP as its taxation advisers. PricewaterhouseCoopers LLP report quarterly to the Board to independently confirm compliance with the venture capital trust legislation, to highlight areas of risk and to inform on changes in legislation.
3. Compliance risk
The Company is listed on The London Stock Exchange and is required to comply with the rules of the UK Listing Authority, as well as with the Companies Act, Accounting Standards and other legislation. Failure to comply with these regulations could result in a delisting of the Company's shares, or other penalties under the Companies Act or from financial reporting oversight bodies.
Board members and the Manager have experience of operating at senior levels within quoted businesses. In addition, the Board and the Manager receive regular updates on new regulation from its Auditor, lawyers and other professional bodies.
4. Internal control risk
Failures in key controls, within the Board or within the Manager's business, could put assets of the Company at risk or result in reduced or inaccurate information being passed to the Board or to shareholders.
The Audit and Risk committee meets with the Manager's Internal Auditors Littlejohn LLP, when required, receiving a report regarding the last formal internal audit performed on the Manager, and providing the opportunity for the Audit and Risk committee to ask specific and detailed questions. During the year the Board met with the internal audit Partner of Littlejohn LLP to discuss the most recent internal audit report completed on the Manager. The Manager has a comprehensive business continuity plan in place in the event that operational continuity is threatened. Further details regarding the Board's management and review of the Group's internal controls through the implementation of the Turnbull guidance are detailed on page 27 of the Financial Statements for the year ended 30 June 2011.
Measures are in place to mitigate information risk in order to ensure the integrity, availability and confidentiality of information used within the business.
5. Reliance upon third parties risk
The Company is reliant upon the services of Albion Ventures LLP for the provision of investment management and administrative functions. There are provisions within the management agreement for the change of Manager under certain circumstances (for further detail, see the management agreement paragraph on page 21 of the Financial Statements for the year ended 30 June 2011). In addition, the Manager has demonstrated to the Board that there is no undue reliance placed upon any one individual within Albion Ventures LLP.
6. Financial risks
By its nature, as a venture capital trust, the Company is exposed to investment risk (which comprises investment price risk and cash flow interest rate risk), credit risk and liquidity risk. The Company's policies for managing these risks and its financial instruments are outlined in full in note 18 to the Financial Statements for the year ended 30 June 2011.
All of the Group's income and expenditure is denominated in sterling and hence the Group has no foreign currency risk. The Group is financed through equity and does not have any borrowings. The Group does not use derivative financial instruments.
14. Other information
The information set out in the Half-yearly Financial Report does not constitute the Group's statutory accounts within the terms of section 434 of the Companies Act 2006 for the periods ended 31 December 2011 and 31 December 2010 and is unaudited. The financial information for the year ended 30 June 2011 does not constitute statutory accounts within the terms of section 434 of the Companies Act 2006 and is derived from the statutory accounts for the financial year, which have been delivered to the Registrar of Companies. The auditors' report on those accounts was not qualified and did not contain statements under s498 (2) or (3) of the Companies Act 2006.
15. Publication
This Half-yearly Financial Report is being sent to shareholders and copies will be made available to the public at the registered office of the Company, Companies House, the National Storage Mechanism and also electronically at www.albion-ventures.co.uk under the 'Our Funds' section.
