Last checked at 21 Aug 2013 07:00
INGENIOUS ENTERTAINMENT VCT 1 PLC
21 August 2013
Half-yearly results for the six months to 30 June 2013
INTERIM MANAGEMENT REPORT
We are delighted to present the half-yearly financial report of Ingenious Entertainment VCT 1 plc (the Company) covering the six months ended 30 June 2013 (the Reporting Period).
Overview of Activities
The Company has now completed the investment strategy for its Ordinary, C and D share classes and is fully invested under VCT regulations in respect of these share classes. The Manager will now focus upon maximising the returns from the investments made from those share classes.
The Company continues to actively source and review investment opportunities for its remaining share classes and two investments were made during the six month period by the C, E and F share classes.
The first investment was made from the E and F share classes into Saturn Star Limited for £1,500,000 (£750,000 by the Company and £750,000 by Ingenious Entertainment VCT 2 plc). Saturn Star Limited was incorporated to stage the first As One In The Park music festival. The event took place in early May and plans are already in place to stage the second festival.
The second investment was made from the C, E and F share classes into Hop Farm Comedy Limited, a company that has been set up to stage a number of comedy based festivals during the summer of 2014. The investment amount was £1,750,000 (£875,000 by the Company and £875,000 by Ingenious Entertainment VCT 2 plc).
The Ordinary share class reached its five year anniversary on 31 July 2013. The following investments in the Ordinary share class were held at the Balance Sheet date, but realised by the Company in July 2013: DRG Media Assets Limited, Golfmania Limited and Jetstream Events Limited. All other investments in the Ordinary share class had been realised prior to the Balance Sheet date. On 8 August 2013, the Company paid a dividend of 53p per Ordinary share.
Fund Raising
In December 2012, Ingenious Entertainment VCT 1 plc and Ingenious Entertainment VCT 2 plc (the Ingenious Entertainment VCTs) launched the offer for subscription for H shares. At 31 July 2013, a combined total of £4.2 million across the Ingenious Entertainment VCTs had been raised. The Ingenious Entertainment VCTs have now raised approximately £60 million through all share classes.
Results
The Ordinary shares, C shares, D shares, E shares, F shares, G shares and H shares are all accounted for as separate pools of funds necessitating separate reporting.
Each of the share classes, apart from the F share class, reported a loss, as expected. This is a reflection of the running costs as well as the fact that there were no significant fluctuations in the fair value of investments during the Reporting Period.
The Ordinary shares made a loss on ordinary activities of £22,000 (31 December 2012: loss of £139,000; 30 June 2012: loss of £82,000). The C shares made a loss of £12,000 (31 December 2012: loss of £73,000; 30 June 2012: loss of £41,000). The D shares made a loss of £34,000 (31 December 2012: loss of £169,000; 30 June 2012: loss of £102,000). The E shares made a loss of £31,000 (31 December 2012: loss of £56,000; 30 June 2012: loss of £27,000). The F shares made a profit of £5,000 (31 December 2012: loss of £16,000; 30 June 2012: loss of £12,000). The G shares made a loss of £47,000 (31 December 2012: loss of £81,000; 30 June 2012: loss of £49,000). The H shares made a loss of £23,000 (31 December 2012: N/A; 30 June 2012: N/A).
The unaudited net asset value per Ordinary share as at 30 June 2013 was 54.6 pence (31 December 2012: 74.8 pence; 30 June 2012: 75.4 pence) although this is after the deduction of an interim dividend of 20.0 pence per share in the Reporting Period and the deduction of a total of 15.0 pence per share in previous periods. The net asset value including distributions to 30 June 2013 was therefore 89.6 pence per share (31 December 2012: 89.8 pence per share; 30 June 2012: 90.4 pence per share). On 8 August 2013, a dividend of 53 pence was paid to shareholders.
The unaudited net asset value per C share is 63.4 pence (31 December 2012: 68.8 pence; 30 June 2012: 70.0 pence) although this is after the deduction of an interim dividend of 5.0 pence per share in the Reporting Period and the deduction of a total of 15.0 pence per share in previous periods. The net asset value including distributions to date is therefore 83.4 pence per share (31 December 2012: 83.8 pence per share; 30 June 2012: 85.0 pence per share).
The unaudited net asset value per D share is 73.0 pence (31 December 2012: 78.5 pence; 30 June 2012: 79.5 pence) although this is after the deduction of an interim dividend of 5.0 pence per share in the Reporting Period and the deduction of a total of 10.0 pence per share in previous periods. The net asset value including distributions to date is therefore 88.0 pence per share (31 December 2012: 88.5 pence per share; 30 June 2012: 89.5 pence per share).
The unaudited net asset value per E share is 80.0 pence (31 December 2012: 86.1 pence; 30 June 2012: 87.1 pence) although this is after the deduction of an interim dividend of 5.0 pence per share in the Reporting Period and the deduction of a total of 5.0 pence per share in previous periods. The net asset value including distributions to date is therefore 90.0 pence per share (31 December 2012: 91.1 pence per share; 30 June 2012: 92.1 pence per share).
The unaudited net asset value per F share is 82.5 pence (31 December 2012: 87.2 pence; 30 June 2012: 87.5 pence) although this is after the deduction of an interim dividend of 5.0 pence per share in the Reporting Period and the deduction of a total of 5.0 pence per share in previous periods. The net asset value including distributions to date is therefore 92.5 pence per share (31 December 2012: 92.2 pence per share; 30 June 2012: 92.5 pence per share).
The unaudited net asset value per G share is 87.0 pence (31 December 2012: 93.3 pence; 30 June 2012: 93.8 pence) although this is after the deduction of an interim dividend of 5.0 pence per share in the Reporting Period. The net asset value including distributions to date is therefore 92.0 pence per share (31 December 2012; 93.3 pence per share; 30 June 2012: 93.8 pence per share).
The unaudited net asset value per H share is 93.8 pence (31 December 2012: N/A; 30 June 2012: N/A). No dividends have been declared or paid to date.
Investment Objective
The Company’s main objective is to invest in companies established to create and bring to market live events and premium entertainment content which will provide shareholders with an attractive return. This strategy will aim to maximise the opportunities for paying tax-free dividends to shareholders from both the actual income received and capital profits on the sale of investments in the companies that the Ingenious Entertainment VCTs invest in (Investee Companies).
The current investment portfolio includes:
Festivals
Shakedown & SD2
Ingenious Entertainment VCT 1 Investment amount: £1,250,000
(£2,500,000 across the Ingenious Entertainment VCTs)
In February 2011, the Ingenious Entertainment VCTs invested £1,500,000 in Venn Music Ltd to stage and promote new music festivals in conjunction with Matt Priest who has many years’ experience in the live sector.
The first Shakedown festival was held in Brighton in September 2011 and hosted performances by Razorlight and Example as well as many other popular acts. The 2012 event (Dizzee Rascal, Chase & Status) was critically acclaimed and more than doubled its attendance to 18,000. Shakedown 2013, which will be held on 28 September, looks set to increase sales volumes yet again with performances by Rizzle Kicks, Labrinth and DJ Fresh.
In December 2012, the Ingenious Entertainment VCTs made a follow on investment of £1,000,000 into Venn Music in order to promote a second day (SD2) at the venue. This second day, which features headline performances by The Wanted and The Saturdays will look to cater for a very different, more family orientated audience, and is expected to help defray the costs of Shakedown and significantly improve the potential profitability of both events. Early indications are that SD2 has been well-received and sales are currently very much on target.
Love Supreme Jazz Festival
Ingenious Entertainment VCT 1 Investment amount: £1,000,000
(£2,000,000 across the Ingenious Entertainment VCTs)
In December 2011, the Ingenious Entertainment VCTs invested £2,000,000 in Love Supreme Festival Limited to promote the Love Supreme Jazz Festival.
The first Love Supreme Jazz Festival, which is a partnership between the Ingenious Entertainment VCTs, Jazz FM and Neapolitan Music, was staged in early July 2013 and received critical acclaim. The Guardian commented that ‘they may have invented the British jazz world’s Glastonbury’.
A strong talent bill saw performances from Bryan Ferry, Jools Holland, Chic, Esperanza Spalding and Robert Glasper together with a vast array of talent representing jazz at all levels. The Manager is confident that another strong brand is being created and will benefit the shareholders in the longer term.
Field Day Festival
Ingenious Entertainment VCT 1 Investment Amount: £1,000,000
(£2,000,000 across the Ingenious Entertainment VCTs)
In November 2012, the Ingenious Entertainment VCTs invested £2,000,000 into Waxarch Limited to promote London’s premier festival for up and coming talent, Field Day Festival. The event has increased its attendance over the last three years with in excess of 30,000 people attending each year and has achieved a consistent level of profitability. The Manager believes that Field Day Festival, which has been extremely well-received in the last two years, can continue to increase its footprint with an increased capacity of 40,000 attendees now in place.
As One In The Park
Ingenious Entertainment VCT 1 Investment Amount: £750,000
(£1,500,000 across the Ingenious Entertainment VCTs)
In February 2013, the Ingenious Entertainment VCTs invested into Saturn Star Limited to promote the first gay and alternative lifestyle festival, As One in The Park. The event was held in Victoria Park in early May on the same weekend as Field Day Festival, thereby affording both events the opportunity to save significant sums from economies of scale.
The event had a solid attendance of 7,000 customers and was extremely well-received within the gay community. Once again the Manager believes that there is a strong opportunity to develop yet another unique event brand.
Hop Farm Comedy Limited
Ingenious Entertainment VCT 1 Investment Amount: £875,000
(£1,750,000 across the Ingenious Entertainment VCTs)
In March and June 2013, the Ingenious Entertainment VCTs invested a combined total of £1,750,000 in Hop Farm Comedy Limited to promote a number of comedy festivals to be held during the course of 2014. It is likely that two events will be held in the first year and, depending upon the commercial success of the brand, further events are likely to be added in due course.
The Manager believes that there is a strong opportunity to focus upon a genre such as comedy which has become more popular over the last few years and which attracts strong audience numbers.
Conferences
Liverpool Sound City Limited
Ingenious Entertainment VCT 1 Investment amount: £600,000
(£1,200,000 across the Ingenious Entertainment VCTs)
In April 2012, the Ingenious Entertainment VCTs invested £1,200,000 in Liverpool Sound City Limited to further expand the Sound City brand both nationally and internationally.
Sound City currently runs a profitable three day international music, media and technology conference and live arts and music festival in Liverpool which is held in May each year. The company has also organised international events in both New York and Abu Dhabi and plans to further expand the brand worldwide.
The 2013 event, which was held in early May, saw record attendances across both the conference and live events. Plans are in hand to reconfigure the event in 2014 in order to deliver bigger attendance numbers, thereby improving the profitability of the event.
Exhibitions
Titans of Cricket
Ingenious Entertainment VCT 1 Investment amount: £1,000,000
(£2,000,000 across the Ingenious Entertainment VCTs)
In June 2011 an investment of £2,000,000 was made by the Ingenious Entertainment VCTs into This Is Cricket Limited to promote a new sports event, Titans of Cricket.
Titans of Cricket was staged in October 2011 and mixed the best of Twenty20, the Indian Premier League and World Cup Cricket, and combined them in a new show that demonstrated the skills of some of the world’s top cricketing stars including Andrew Flintoff and Sanath Jayasuriya. The first event took place at the O2 in London and attracted positive reviews but did not perform well financially.
The future of the Titans of Cricket brand remains under review, but it is unlikely that an event will be staged until 2014 at the earliest. A provision has been made in respect of the Company’s share of losses to date.
Outlook
The economic climate remains extremely difficult with discretionary expenditure under continued pressure. Audiences still attend live events in their millions, however, and the Manager believes that it remains capable of sourcing and creating distinctive live event properties that will continue to appeal to individual sectors of the population.
The Manager’s focus remains very firmly upon ensuring that each investment is carefully sourced and structured in order to balance potential upside against capital risk. We also believe that the Company’s strategy, which aims to successfully balance equity risk with a significant level of downside protection through minimum revenue arrangements in respect of each investment, is perfectly suited to the current economic environment whereby shareholders are very much focused upon capital preservation.
Ingenious Ventures20 August 2013
| CONDENSED INCOME STATEMENT (UNAUDITED) | ||||||||||||||||||||||||||||||||||||||||
| for the six months ended 30 June 2013 | ||||||||||||||||||||||||||||||||||||||||
| Six months ended30 June 2013(unaudited) | Six months ended30 June 2012(unaudited) | Year ended31 December 2012(audited) | ||||||||||||||||||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | Revenue | Capital | Total | ||||||||||||||||||||||||||||||||
| Note | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||||||||||||||
| Gain on disposal of investments | - | 57 | 57 | - | 14 | 14 | - | 54 | 54 | |||||||||||||||||||||||||||||||
| Decrease in fair value of investments held | - | (101) | (101) | - | (184) | (184) | - | (289) | (289) | |||||||||||||||||||||||||||||||
| Investment income | 195 | - | 195 | 161 | - | 161 | 318 | - | 318 | |||||||||||||||||||||||||||||||
| Arrangement fees | (10) | - | (10) | (30) | - | (30) | (39) | - | (39) | |||||||||||||||||||||||||||||||
| Investment management fees | (94) | (94) | (188) | (94) | (94) | (188) | (187) | (187) | (374) | |||||||||||||||||||||||||||||||
| Other expenses | (117) | - | (117) | (86) | - | (86) | (204) | - | (204) | |||||||||||||||||||||||||||||||
| Loss on ordinary activities before taxation | (26) | (138) | (164) | (49) | (264) | (313) | (112) | (422) | (534) | |||||||||||||||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | - | - | - | |||||||||||||||||||||||||||||||
| Loss attributable to equity shareholders | (26) | (138) | (164) | (49) | (264) | (313) | (112) | (422) | (534) | |||||||||||||||||||||||||||||||
| Basic and diluted return per share (pence) | ||||||||||||||||||||||||||||||||||||||||
| Ordinary share | 2 | 0.4 | (0.6) | (0.2) | 0.7 | (1.5) | (0.8) | 1.2 | (2.5) | (1.3) | ||||||||||||||||||||||||||||||
| C share | 2 | (0.2) | (0.2) | (0.4) | (0.3) | (1.2) | (1.5) | (0.6) | (2.0) | (2.6) | ||||||||||||||||||||||||||||||
| D share | 2 | 0.3 | (0.8) | (0.5) | (0.4) | (1.1) | (1.5) | (0.8) | (1.7) | (2.5) | ||||||||||||||||||||||||||||||
| E share | 2 | (0.6) | (0.5) | (1.1) | (0.8) | (0.2) | (1.0) | (1.6) | (0.4) | (2.0) | ||||||||||||||||||||||||||||||
| F share | 2 | (0.6) | 1.0 | 0.4 | (1.0) | 0.2 | (0.8) | (2.1) | 1.1 | (1.0) | ||||||||||||||||||||||||||||||
| G share | 2 | (1.1) | (0.3) | (1.4) | (3.2) | (0.4) | (3.6) | (3.6) | - | (3.6) | ||||||||||||||||||||||||||||||
| H share | 2 | (2.3) | (0.5) | (2.8) | - | - | - | - | - | - | ||||||||||||||||||||||||||||||
The Company had no recognised gains and losses other than those disclosed above.
The total column is the Income Statement of all share classes for the period. The supplementary capital and revenue columns are prepared following guidance published by the Association of Investment Companies (AIC).
The accompanying notes form an integral part of these financial statements.
The Company had no H shares in issue in the periods to 31 December 2012 or 30 June 2012.
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||
| CONDENSED INCOME STATEMENT (UNAUDITED) | ||||||||||||||||||||||||
| for the six months ended 30 June 2013 | ||||||||||||||||||||||||
| Ordinary shares | C shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 26 | 26 | - | 11 | 11 | ||||||||||||||||||
| Decrease in fair value of investments held | - | (60) | (60) | - | (9) | (9) | ||||||||||||||||||
| Investment income | 104 | - | 104 | 17 | - | 17 | ||||||||||||||||||
| Arrangement fees | - | - | - | - | - | - | ||||||||||||||||||
| Investment management fees | (29) | (29) | (58) | (8) | (8) | (16) | ||||||||||||||||||
| Other expenses | (34) | - | (34) | (15) | - | (15) | ||||||||||||||||||
| Profit/(loss) on ordinary activities before taxation | 41 | (63) | (22) | (6) | (6) | (12) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| Profit/(loss) attributable to equity shareholders | 41 | (63) | (22) | (6) | (6) | (12) | ||||||||||||||||||
| Basic and diluted return per share (pence) | 0.4 | (0.6) | (0.2) | (0.2) | (0.2) | (0.4) | ||||||||||||||||||
| D shares | E shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 6 | 6 | - | 4 | 4 | ||||||||||||||||||
| Decrease in fair value of investments held | - | (41) | (41) | - | (6) | (6) | ||||||||||||||||||
| Investment income | 66 | - | 66 | 4 | - | 4 | ||||||||||||||||||
| Arrangement fees | - | - | - | - | - | - | ||||||||||||||||||
| Investment management fees | (22) | (22) | (44) | (11) | (11) | (22) | ||||||||||||||||||
| Other expenses | (21) | - | (21) | (11) | - | (11) | ||||||||||||||||||
| Profit/(loss) on ordinary activities before taxation | 23 | (57) | (34) | (18) | (13) | (31) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| Profit/(loss) attributable to equity shareholders | 23 | (57) | (34) | (18) | (13) | (31) | ||||||||||||||||||
| Basic and diluted return per share (pence) | 0.3 | (0.8) | (0.5) | (0.6) | (0.5) | (1.1) | ||||||||||||||||||
| F shares | G shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 10 | 10 | - | - | - | ||||||||||||||||||
| Increase in fair value of investments held | - | 10 | 10 | - | 5 | 5 | ||||||||||||||||||
| Investment income | 4 | - | 4 | - | - | - | ||||||||||||||||||
| Arrangement fees | - | - | - | - | - | - | ||||||||||||||||||
| Investment management fees | (5) | (5) | (10) | (15) | (15) | (30) | ||||||||||||||||||
| Other expenses | (9) | - | (9) | (22) | - | (22) | ||||||||||||||||||
| (Loss)/profit on ordinary activities before taxation | (10) | 15 | 5 | (37) | (10) | (47) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| (Loss)/profit attributable to equity shareholders | (10) | 15 | 5 | (37) | (10) | (47) | ||||||||||||||||||
| Basic and diluted return per share (pence) | (0.6) | 1.0 | 0.4 | (1.1) | (0.3) | (1.4) | ||||||||||||||||||
| H shares | ||||||||||||||||||||||||
| Revenue | Capital | Total | ||||||||||||||||||||||
| £'000 | £'000 | £'000 | ||||||||||||||||||||||
| Gain on disposal of investments | - | - | - | |||||||||||||||||||||
| Increase/(decrease) in fair value of investments held | - | - | - | |||||||||||||||||||||
| Investment income | - | - | - | |||||||||||||||||||||
| Arrangement fees | (10) | - | (10) | |||||||||||||||||||||
| Investment management fees | (4) | (4) | (8) | |||||||||||||||||||||
| Other expenses | (5) | - | (5) | |||||||||||||||||||||
| Loss on ordinary activities before taxation | (19) | (4) | (23) | |||||||||||||||||||||
| Tax on ordinary activities | - | - | - | |||||||||||||||||||||
| Loss attributable to equity shareholders | (19) | (4) | (23) | |||||||||||||||||||||
| Basic and diluted return per share (pence) | (2.3) | (0.5) | (2.8) | |||||||||||||||||||||
The Company had no recognised gains and losses other than those disclosed above.
The total column is the Income Statement per share class for the period. The supplementary capital and revenue columns are prepared following guidance published by the AIC.
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||
| CONDENSED INCOME STATEMENT (UNAUDITED) | ||||||||||||||||||||||||
| for the six months ended 30 June 2012 | ||||||||||||||||||||||||
| Ordinary shares | C shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 1 | 1 | - | - | - | ||||||||||||||||||
| Decrease in fair value of investments held | - | (116) | (116) | - | (25) | (25) | ||||||||||||||||||
| Investment income | 129 | - | 129 | 15 | - | 15 | ||||||||||||||||||
| Arrangement fees | - | - | - | - | - | - | ||||||||||||||||||
| Investment management fees | (35) | (35) | (70) | (9) | (9) | (18) | ||||||||||||||||||
| Other expenses | (26) | - | (26) | (13) | - | (13) | ||||||||||||||||||
| Profit/(loss) on ordinary activities before taxation | 68 | (150) | (82) | (7.0) | (34) | (41) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| Profit/(loss) attributable to equity shareholders | 68 | (150) | (82) | (7) | (34) | (41) | ||||||||||||||||||
| Basic and diluted return per share (pence) | 0.7 | (1.5) | (0.8) | (0.3) | (1.2) | (1.5) | ||||||||||||||||||
| D shares | E shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 10 | 10 | - | - | - | ||||||||||||||||||
| (Decrease)/increase in fair value of investments held | - | (57) | (57) | - | 7 | 7 | ||||||||||||||||||
| Investment income | 15 | - | 15 | 1 | - | 1 | ||||||||||||||||||
| Arrangement fees | - | - | - | - | - | - | ||||||||||||||||||
| Investment management fees | (25) | (25) | (50) | (12) | (12) | (24) | ||||||||||||||||||
| Other expenses | (20) | - | (20) | (11) | - | (11) | ||||||||||||||||||
| Loss on ordinary activities before taxation | (30) | (72) | (102) | (22) | (5) | (27) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| Loss attributable to equity shareholders | (30) | (72) | (102) | (22) | (5) | (27) | ||||||||||||||||||
| Basic and diluted return per share (pence) | (0.4) | (1.1) | (1.5) | (0.8) | (0.2) | (1.0) | ||||||||||||||||||
| F shares | G shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 3 | 3 | - | - | - | ||||||||||||||||||
| Increase in fair value of investments held | - | 7 | 7 | - | - | - | ||||||||||||||||||
| Investment income | 1 | - | 1 | - | - | - | ||||||||||||||||||
| Arrangement fees | - | - | - | (30) | - | (30) | ||||||||||||||||||
| Investment management fees | (7) | (7) | (14) | (6) | (6) | (12) | ||||||||||||||||||
| Other expenses | (9) | - | (9) | (7) | - | (7) | ||||||||||||||||||
| (Loss)/profit on ordinary activities before taxation | (15) | 3 | (12) | (43) | (6) | (49) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| (Loss)/profit attributable to equity shareholders | (15) | 3 | (12) | (43) | (6) | (49) | ||||||||||||||||||
| Basic and diluted return per share (pence) | (1.0) | 0.2 | (0.8) | (3.2) | (0.4) | (3.6) | ||||||||||||||||||
| H shares | ||||||||||||||||||||||||
| Revenue | Capital | Total | ||||||||||||||||||||||
| £'000 | £'000 | £'000 | ||||||||||||||||||||||
| Gain on disposal of investments | - | - | - | |||||||||||||||||||||
| Increase/(decrease) in fair value of investments held | - | - | - | |||||||||||||||||||||
| Investment income | - | - | - | |||||||||||||||||||||
| Arrangement fees | - | - | - | |||||||||||||||||||||
| Investment management fees | - | - | - | |||||||||||||||||||||
| Other expenses | - | - | - | |||||||||||||||||||||
| Profit/(loss) on ordinary activities before taxation | - | - | - | |||||||||||||||||||||
| Tax on ordinary activities | - | - | - | |||||||||||||||||||||
| Profit/(loss) attributable to equity shareholders | - | - | - | |||||||||||||||||||||
| Basic and diluted return per share (pence) | - | - | - | |||||||||||||||||||||
The Company had no recognised gains and losses other than those disclosed above.
The total column is the Income Statement per share class for the period. The supplementary capital and revenue columns are prepared following guidance published by the AIC.
The Company had no H shares in issue in the period to 30 June 2012.
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||
| CONDENSED INCOME STATEMENT (UNAUDITED) | ||||||||||||||||||||||||
| for the year ended 31 December 2012 | ||||||||||||||||||||||||
| Ordinary shares | C shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 11 | 11 | - | 3 | 3 | ||||||||||||||||||
| Decrease in fair value of investments held | - | (201) | (201) | - | (42) | (42) | ||||||||||||||||||
| Investment income | 246 | - | 246 | 29 | - | 29 | ||||||||||||||||||
| Arrangement fees | - | - | - | - | - | - | ||||||||||||||||||
| Investment management fees | (69) | (69) | (138) | (18) | (18) | (36) | ||||||||||||||||||
| Other expenses | (57) | - | (57) | (27) | - | (27) | ||||||||||||||||||
| Profit/(loss) on ordinary activities before taxation | 120 | (259) | (139) | (16) | (57) | (73) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| Profit/(loss) attributable to equity shareholders | 120 | (259) | (139) | (16) | (57) | (73) | ||||||||||||||||||
| Basic and diluted return per share (pence) | 1.2 | (2.5) | (1.3) | (0.6) | (2.0) | (2.6) | ||||||||||||||||||
| D shares | E shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 31 | 31 | - | 4 | 4 | ||||||||||||||||||
| (Decrease)/increase in fair value of investments held | - | (96) | (96) | - | 7 | 7 | ||||||||||||||||||
| Investment income | 40 | - | 40 | 1 | - | 1 | ||||||||||||||||||
| Arrangement fees | - | - | - | - | - | - | ||||||||||||||||||
| Investment management fees | (48) | (48) | (96) | (22) | (22) | (44) | ||||||||||||||||||
| Other expenses | (48) | - | (48) | (24) | - | (24) | ||||||||||||||||||
| Loss on ordinary activities before taxation | (56) | (113) | (169) | (45) | (11) | (56) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| Loss attributable to equity shareholders | (56) | (113) | (169) | (45) | (11) | (56) | ||||||||||||||||||
| Basic and diluted return per share (pence) | (0.8) | (1.7) | (2.5) | (1.6) | (0.4) | (2.0) | ||||||||||||||||||
| F shares | G shares | |||||||||||||||||||||||
| Revenue | Capital | Total | Revenue | Capital | Total | |||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |||||||||||||||||||
| Gain on disposal of investments | - | 5 | 5 | - | - | - | ||||||||||||||||||
| Increase in fair value of investments held | - | 24 | 24 | - | 19 | 19 | ||||||||||||||||||
| Investment income | 1 | - | 1 | 1 | - | 1 | ||||||||||||||||||
| Arrangement fees | - | - | - | (39) | - | (39) | ||||||||||||||||||
| Investment management fees | (12) | (12) | (24) | (18) | (18) | (36) | ||||||||||||||||||
| Other expenses | (22) | - | (22) | (26) | - | (26) | ||||||||||||||||||
| (Loss)/profit on ordinary activities before taxation | (33) | 17 | (16) | (82) | 1 | (81) | ||||||||||||||||||
| Tax on ordinary activities | - | - | - | - | - | - | ||||||||||||||||||
| (Loss)/profit attributable to equity shareholders | (33) | 17 | (16) | (82) | 1 | (81) | ||||||||||||||||||
| Basic and diluted return per share (pence) | (2.1) | 1.1 | (1.0) | (3.6) | - | (3.6) | ||||||||||||||||||
| H shares | ||||||||||||||||||||||||
| Revenue | Capital | Total | ||||||||||||||||||||||
| £'000 | £'000 | £'000 | ||||||||||||||||||||||
| Gain on disposal of investments | - | - | - | |||||||||||||||||||||
| Increase/(decrease) in fair value of investments held | - | - | - | |||||||||||||||||||||
| Investment income | - | - | - | |||||||||||||||||||||
| Arrangement fees | - | - | - | |||||||||||||||||||||
| Investment management fees | - | - | - | |||||||||||||||||||||
| Other expenses | - | - | - | |||||||||||||||||||||
| Profit/(loss) on ordinary activities before taxation | - | - | - | |||||||||||||||||||||
| Tax on ordinary activities | - | - | - | |||||||||||||||||||||
| Profit/(loss) attributable to equity shareholders | - | - | - | |||||||||||||||||||||
| Basic and diluted return per share (pence) | - | - | - | |||||||||||||||||||||
The Company had no recognised gains and losses other than those disclosed above.
The total column is the Income Statement per share class for the period. The supplementary capital and revenue columns are prepared following guidance published by the AIC.
The Company had no H shares in issue in the year to 31 December 2012.
| CONDENSED BALANCE SHEET (UNAUDITED) | ||||||||||||||||
| as at 30 June 2013 | ||||||||||||||||
| 30 June2013(unaudited) | 30 June2012(unaudited) | 31 December2012(audited) | ||||||||||||||
| Note | £'000 | £'000 | £'000 | |||||||||||||
| Fixed assets | ||||||||||||||||
| Qualifying Investments | 8,782 | 10,831 | 11,949 | |||||||||||||
| Current assets | ||||||||||||||||
| Debtors | 137 | 132 | 139 | |||||||||||||
| Non-qualifying Investments | 3 | 8,772 | 7,918 | 8,734 | ||||||||||||
| Cash at bank and in hand | 2,894 | 2,631 | 1,225 | |||||||||||||
| 11,803 | 10,681 | 10,098 | ||||||||||||||
| Creditors: amounts falling due within one year | (54) | (60) | (87) | |||||||||||||
| Net current assets | 11,749 | 10,621 | 10,011 | |||||||||||||
| Net assets | 20,531 | 21,452 | 21,960 | |||||||||||||
| Capital and reserves | ||||||||||||||||
| Called-up share capital | 294 | 269 | 277 | |||||||||||||
| Share premium account | 1,634 | 2,607 | - | |||||||||||||
| Other reserve account | 20,361 | 19,949 | 23,277 | |||||||||||||
| Capital reserve | (913) | (617) | (775) | |||||||||||||
| Revenue reserve | (845) | (756) | (819) | |||||||||||||
| Shareholders’ funds | 20,531 | 21,452 | 21,960 | |||||||||||||
| Net asset value per Ordinary share | 4 | 54.6 | 75.4 | 74.8 | ||||||||||||
| Net asset value per C share | 4 | 63.4 | 70.0 | 68.8 | ||||||||||||
| Net asset value per D share | 4 | 73.0 | 79.5 | 78.5 | ||||||||||||
| Net asset value per E share | 4 | 80.0 | 87.1 | 86.1 | ||||||||||||
| Net asset value per F share | 4 | 82.5 | 87.5 | 87.2 | ||||||||||||
| Net asset value per G share | 4 | 87.0 | 93.8 | 93.3 | ||||||||||||
| Net asset value per H share | 4 | 93.8 | - | - | ||||||||||||
The accompanying notes form an integral part of these financial statements.
The condensed set of financial statements were approved by the Board of Directors on 20 August 2013 and signed on its behalf by:
Keith TurnerDirectorCompany Registration Number: 6395011 (England & Wales)
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||||||
| CONDENSED BALANCE SHEET (UNAUDITED) | ||||||||||||||||||||||||||||
| As at 30 June 2013 (unaudited) | ||||||||||||||||||||||||||||
| Ordinary shares £'000 | C shares £'000 | D shares £'000 | E shares £'000 | F shares £'000 | G shares £'000 | H shares £'000 | ||||||||||||||||||||||
| Fixed assets | ||||||||||||||||||||||||||||
| Qualifying Investments | 2,252 | 1,273 | 3,757 | 927 | 573 | - | - | |||||||||||||||||||||
| Current assets | ||||||||||||||||||||||||||||
| Debtors | 108 | - | 29 | - | - | - | - | |||||||||||||||||||||
| Non-qualifying Investments | 417 | 491 | 1,130 | 1,353 | 725 | 3,040 | 1,616 | |||||||||||||||||||||
| Cash at bank and in hand | 2,832 | 19 | 4 | 1 | 1 | 23 | 14 | |||||||||||||||||||||
| 3,357 | 510 | 1,163 | 1,354 | 726 | 3,063 | 1,630 | ||||||||||||||||||||||
| Creditors: amounts falling due within one year | (35) | (2) | (6) | (3) | (2) | (4) | (2) | |||||||||||||||||||||
| Net current assets | 3,322 | 508 | 1,157 | 1,351 | 724 | 3,059 | 1,628 | |||||||||||||||||||||
| Net assets | 5,574 | 1,781 | 4,914 | 2,278 | 1,297 | 3,059 | 1,628 | |||||||||||||||||||||
| Capital and reserves | ||||||||||||||||||||||||||||
| Called-up share capital | 102 | 28 | 68 | 28 | 16 | 35 | 17 | |||||||||||||||||||||
| Share premium account | - | - | - | - | - | - | 1,634 | |||||||||||||||||||||
| Other reserve account | 6,060 | 2,071 | 5,340 | 2,409 | 1,329 | 3,152 | - | |||||||||||||||||||||
| Capital reserve | (534) | (142) | (227) | (31) | 34 | (9) | (4) | |||||||||||||||||||||
| Revenue reserve | (54) | (176) | (267) | (128) | (82) | (119) | (19) | |||||||||||||||||||||
| Shareholders’ funds | 5,574 | 1,781 | 4,914 | 2,278 | 1,297 | 3,059 | 1,628 | |||||||||||||||||||||
| Net asset value excluding distributions to date (pence per share) | 54.6 | 63.4 | 73.0 | 80.0 | 82.5 | 87.0 | 93.8 | |||||||||||||||||||||
| Net asset value including distributions to date (pence per share) | 89.6 | 83.4 | 88.0 | 90.0 | 92.5 | 92.0 | 93.8 | |||||||||||||||||||||
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||||||
| CONDENSED BALANCE SHEET (UNAUDITED) | ||||||||||||||||||||||||||||
| As at 30 June 2012 (unaudited) | ||||||||||||||||||||||||||||
| Ordinary shares £'000 | C shares £'000 | D shares £'000 | E shares £'000 | F shares £'000 | G shares £'000 | H shares £'000 | ||||||||||||||||||||||
| Fixed assets | ||||||||||||||||||||||||||||
| Qualifying Investments | 6,608 | 1,716 | 2,257 | 125 | 125 | - | - | |||||||||||||||||||||
| Current assets | ||||||||||||||||||||||||||||
| Debtors | 132 | - | - | - | - | - | - | |||||||||||||||||||||
| Non-qualifying Investments | 968 | 245 | 3,098 | 2,356 | 1,251 | - | - | |||||||||||||||||||||
| Cash at bank and in hand | 7 | 7 | 8 | 3 | 1 | 2,605 | - | |||||||||||||||||||||
| 1,107 | 252 | 3,106 | 2,359 | 1,252 | 2,605 | - | ||||||||||||||||||||||
| Creditors: amounts falling due within one year | (21) | (2) | (11) | (4) | (2) | (20) | - | |||||||||||||||||||||
| Net current assets | 1,086 | 250 | 3,095 | 2,355 | 1,250 | 2,585 | - | |||||||||||||||||||||
| Net assets | 7,694 | 1,966 | 5,352 | 2,480 | 1,375 | 2,585 | - | |||||||||||||||||||||
| Capital and reserves | ||||||||||||||||||||||||||||
| Called-up share capital | 102 | 28 | 68 | 28 | 16 | 27 | - | |||||||||||||||||||||
| Share premium account | - | - | - | - | - | 2,607 | - | |||||||||||||||||||||
| Other reserve account | 8,101 | 2,212 | 5,677 | 2,551 | 1,408 | - | - | |||||||||||||||||||||
| Capital reserve | (362) | (113) | (129) | (12) | 5 | (6) | - | |||||||||||||||||||||
| Revenue reserve | (147) | (161) | (264) | (87) | (54) | (43) | - | |||||||||||||||||||||
| Shareholders’ funds | 7,694 | 1,966 | 5,352 | 2,480 | 1,375 | 2,585 | - | |||||||||||||||||||||
| Net asset value excluding distributions to date (pence per share) | 75.4 | 70.0 | 79.5 | 87.1 | 87.5 | 93.8 | - | |||||||||||||||||||||
| Net asset value including distributions to date (pence per share) | 90.4 | 85.0 | 89.5 | 92.1 | 92.5 | 93.8 | - | |||||||||||||||||||||
The Company had no H shares in issue in the period to 30 June 2012.
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F ,G AND H SHARE FUNDS | ||||||||||||||||||||||||||||
| CONDENSED BALANCE SHEET (UNAUDITED) | ||||||||||||||||||||||||||||
| As at 31 December 2012 (unaudited) | ||||||||||||||||||||||||||||
| Ordinary shares £'000 | C shares £'000 | D shares £'000 | E shares £'000 | F shares £'000 | G shares £'000 | H shares £'000 | ||||||||||||||||||||||
| Fixed assets | ||||||||||||||||||||||||||||
| Qualifying Investments | 6,314 | 1,628 | 3,757 | 125 | 125 | - | - | |||||||||||||||||||||
| Current assets | ||||||||||||||||||||||||||||
| Debtors | 139 | - | - | - | - | - | - | |||||||||||||||||||||
| Non-qualifying Investments | 897 | 221 | 1,528 | 1,845 | 980 | 3,263 | - | |||||||||||||||||||||
| Cash at bank and in hand | 338 | 89 | 11 | 488 | 272 | 27 | - | |||||||||||||||||||||
| 1,374 | 310 | 1,539 | 2,333 | 1,252 | 3,290 | - | ||||||||||||||||||||||
| Creditors: amounts falling due within one year | (51) | (4) | (11) | (7) | (6) | (8) | - | |||||||||||||||||||||
| Net current assets | 1,323 | 306 | 1,528 | 2,326 | 1,246 | 3,282 | - | |||||||||||||||||||||
| Net assets | 7,637 | 1,934 | 5,285 | 2,451 | 1,371 | 3,282 | - | |||||||||||||||||||||
| Capital and reserves | ||||||||||||||||||||||||||||
| Called-up share capital | 102 | 28 | 68 | 28 | 16 | 35 | - | |||||||||||||||||||||
| Share premium account | - | - | - | - | - | - | - | |||||||||||||||||||||
| Other reserve account | 8,101 | 2,212 | 5,677 | 2,551 | 1,408 | 3,328 | - | |||||||||||||||||||||
| Capital reserve | (471) | (136) | (170) | (18) | 19 | 1 | - | |||||||||||||||||||||
| Revenue reserve | (95) | (170) | (290) | (110) | (72) | (82) | - | |||||||||||||||||||||
| Shareholders’ funds | 7,637 | 1,934 | 5,285 | 2,451 | 1,371 | 3,282 | - | |||||||||||||||||||||
| Net asset value excluding distributions to date (pence per share) | 74.8 | 68.8 | 78.5 | 86.1 | 87.2 | 93.3 | - | |||||||||||||||||||||
| Net asset value including distributions to date (pence per share) | 89.8 | 83.8 | 88.5 | 91.1 | 92.2 | 93.3 | - | |||||||||||||||||||||
The Company had no H shares in issue in the year to 31 December 2012.
| RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS (UNAUDITED) | ||||||||||||
| for the six months ended 30 June 2013 | ||||||||||||
| Six months ended30 June 2013(unaudited) | Six months ended 30June 2012(unaudited) | Year ended31 December 2012(audited) | ||||||||||
| £'000 | £'000 | £'000 | ||||||||||
| Opening shareholders’ funds | 21,960 | 20,340 | 20,340 | |||||||||
| Capital subscribed | 1,693 | 2,756 | 3,518 | |||||||||
| Issue costs | (42) | (122) | (155) | |||||||||
| Dividends | (2,916) | (1,209) | (1,209) | |||||||||
| Loss for the period | (164) | (313) | (534) | |||||||||
| Closing shareholders’ funds | 20,531 | 21,452 | 21,960 | |||||||||
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||||||
| RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS (UNAUDITED) | ||||||||||||||||||||||||||||
| for the six months ended 30 June 2013 | ||||||||||||||||||||||||||||
| Ordinary shares | C shares | D shares | E shares | F shares | G shares | H shares | ||||||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | ||||||||||||||||||||||
| Opening shareholders’ funds | 7,637 | 1,934 | 5,285 | 2,451 | 1,371 | 3,282 | - | |||||||||||||||||||||
| Capital subscribed | - | - | - | - | - | - | 1,693 | |||||||||||||||||||||
| Issue costs | - | - | - | - | - | - | (42) | |||||||||||||||||||||
| Dividends | (2,041) | (141) | (337) | (142) | (79) | (176) | - | |||||||||||||||||||||
| (Loss)/profit for the period | (22) | (12) | (34) | (31) | 5 | (47) | (23) | |||||||||||||||||||||
| Closing shareholders’ funds | 5,574 | 1,781 | 4,914 | 2,278 | 1,297 | 3,059 | 1,628 | |||||||||||||||||||||
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||||||
| RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS (UNAUDITED) | ||||||||||||||||||||||||||||
| for the six months ended 30 June 2012 | ||||||||||||||||||||||||||||
| Ordinary shares | C shares | D shares | E shares | F shares | G shares | H shares | ||||||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | ||||||||||||||||||||||
| Opening shareholders’ funds | 8,286 | 2,148 | 5,791 | 2,649 | 1,466 | - | - | |||||||||||||||||||||
| Capital subscribed | - | - | - | - | - | 2,756 | - | |||||||||||||||||||||
| Issue costs | - | - | - | - | - | (122) | - | |||||||||||||||||||||
| Dividends | (510) | (141) | (337) | (142) | (79) | - | - | |||||||||||||||||||||
| Loss for the period | (82) | (41) | (102) | (27) | (12) | (49) | - | |||||||||||||||||||||
| Closing shareholders’ funds | 7,694 | 1,966 | 5,352 | 2,480 | 1,375 | 2,585 | - | |||||||||||||||||||||
The Company had no H shares in issue in the period to 30 June 2012.
| NON-STATUTORY ANALYSIS (UNAUDITED) BETWEEN THE ORDINARY, C, D, E, F, G AND H SHARE FUNDS | ||||||||||||||||||||||||||||
| RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS’ FUNDS (UNAUDITED) | ||||||||||||||||||||||||||||
| for the year ended 31 December 2012 | ||||||||||||||||||||||||||||
| Ordinary shares | C shares | D shares | E shares | F shares | G shares | H shares | ||||||||||||||||||||||
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | ||||||||||||||||||||||
| Opening shareholders’ funds | 8,286 | 2,148 | 5,791 | 2,649 | 1,466 | - | - | |||||||||||||||||||||
| Capital subscribed | - | - | - | - | - | 3,518 | - | |||||||||||||||||||||
| Issue costs | - | - | - | - | - | (155) | - | |||||||||||||||||||||
| Dividends | (510) | (141) | (337) | (142) | (79) | - | - | |||||||||||||||||||||
| Loss for the period | (139) | (73) | (169) | (56) | (16) | (81) | - | |||||||||||||||||||||
| Closing shareholders’ funds | 7,637 | 1,934 | 5,285 | 2,451 | 1,371 | 3,282 | - | |||||||||||||||||||||
The Company had no H shares in issue in the year to 31 December 2012.
| CASH FLOW STATEMENT (UNAUDITED) | ||||||||||||
| for the six months ended 30 June 2013 | ||||||||||||
| 30 June 2013 (unaudited) | 30 June 2012 (unaudited) | 31 December 2012 (audited) | ||||||||||
| £'000 | £'000 | £'000 | ||||||||||
| Net cash flow from operating activities | (206) | (300) | (545) | |||||||||
| Financial investment | ||||||||||||
| Purchase of Qualifying Investments | (1,625) | (600) | (2,100) | |||||||||
| Return of Qualifying Investments | 4,792 | - | 400 | |||||||||
| Net cash flow from financial investment | 3,167 | (600) | (1,700) | |||||||||
| Management of liquid resources | ||||||||||||
| Purchase of Non-qualifying Investments | (2,018) | - | (3,389) | |||||||||
| Disposal of Non-qualifying Investments | 1,991 | 1,925 | 4,524 | |||||||||
| Net cash flow from liquid resources | (27) | 1,925 | 1,135 | |||||||||
|
| ||||||||||||
| Financing | ||||||||||||
| Issue of shares | 1,693 | 2,756 | 3,518 | |||||||||
| Issue costs of shares | (42) | (122) | (155) | |||||||||
| Net cash flow from financing | 1,651 | 2,634 | 3,363 | |||||||||
| Dividends | ||||||||||||
| Payment of dividends | (2,916) | (1,209) | (1,209) | |||||||||
| Net cash flow from dividends | (2,916) | (1,209) | (1,209) | |||||||||
| Increase in cash | 1,669 | 2,450 | 1,044 | |||||||||
| Reconciliation of loss before taxation to net cash flow from operating activities | ||||||||||||
| £'000 | £'000 | £'000 | ||||||||||
| Loss on ordinary activities before tax | (164) | (313) | (534) | |||||||||
| Decrease in fair value of investments held | 101 | 184 | 289 | |||||||||
| Investment income | (112) | (126) | (275) | |||||||||
| Decrease/(increase) in receivables | 2 | (52) | (59) | |||||||||
| (Decrease)/increase in payables | (33) | 7 | 34 | |||||||||
| Net cash flow from operating activities | (206) | (300) | (545) | |||||||||
| Reconciliation of net cash flow to movement in net funds | ||||||||||||
| £'000 | £'000 | £'000 | ||||||||||
| Increase in cash in the period | 1,669 | 2,450 | 1,044 | |||||||||
| Purchase/(disposal) of Non-qualifying investments | 317 | (1,925) | (1,412) | |||||||||
| Fair value adjustment on Non-qualifying investments | 11 | 20 | 30 | |||||||||
| Change in net funds | 1,997 | 545 | (338) | |||||||||
| Opening net funds | 9,666 | 10,004 | 10,004 | |||||||||
| Closing net funds | 11,663 | 10,549 | 9,666 | |||||||||
Net funds comprise of cash of £2,894k (31 December 2012: £1,225k; 30 June 2012: £2,631k) and Non-qualifying assets, excluding Investment in Investee Companies, of £8,769k (31 December 2012: £8,441k; 30 June 2012: £7,918k).
NOTES TO THE FINANCIAL STATEMENTS (UNAUDITED)
for the six months ended 30 June 2013
1. Accounting Policies
a) Basis of Accounting
The financial statements for the Reporting Period have been prepared in compliance with UK Generally Accepted Accounting Practice, and with the Statement of Recommended Practice (the SORP) entitled “Financial Statements of Investment Trust Companies and Venture Capital Trusts” (with the exception of paragraph 80 of the SORP regarding detailed disclosure of financial and operational performance of the Company’s unquoted investments due to their confidential nature) which was issued in January 2009.
These financial statements, which have not been audited or reviewed by the Auditors, have been prepared on a going concern basis under the historical cost convention, except for the measurement at fair value for investments. The principal accounting policies have remained unchanged from those set out in the Company’s 2012 Annual Report and Accounts.
b) Valuation of Investments
The Company’s business is investing in financial assets with a view to profiting from their total return in the form of income and capital growth. As set out in the International Private Equity and Venture Capital Valuation Guidelines below, all investments are designated at fair value.
International Private Equity and Venture Capital Valuation Guidelines
Unquoted investments, including equity and loan investments, are designated at fair value through profit and loss and are valued in accordance with the International Private Equity and Venture Capital Guidelines and Financial Reporting Standard 26 “Financial Instruments: Recognition and Measurement” (FRS 26). Investments are initially recognised at cost. The investments are subsequently re-measured at fair value, as estimated by the Directors. Investment holding gains or losses arising from the revaluation of investments are taken directly to the Income Statement. Fair value is determined as follows:
Fair value is the amount for which an asset could be exchanged between knowledgeable, willing parties in an arm’s length transaction. In estimating the fair value for an investment, the Manager will apply a methodology that is appropriate in light of the nature, facts and circumstances of the investment and its materiality in the context of the total investment portfolio and will use reasonable assumptions and estimates. An appropriate methodology incorporates available information about all factors that are likely to materially affect the fair value of the investment. The valuation methodologies are applied consistently from period to period, except where a change would result in a better estimate of fair value. Any changes in valuation methodologies will be clearly disclosed in the financial statements.The most widely used methodologies are listed below. In assessing which methodology is appropriate, the Directors are predisposed towards those methodologies that draw upon market-based measures of risk and return.
Price of recent investment Discounted cash flows/earnings multiple Net assets Available market pricesOf these, the two methodologies most applicable to the Company’s investments are:
1 - Price of recent investment
Where the investment being valued was made recently, its cost will generally provide a good indication of value. It is generally considered that this would only apply for a limited period; in practice a period up to the start of the first live event or entertainment content which forms the investment is often applied as the long stop date for such a valuation.
2 - Discounted cash flows/earnings of the underlying business
Investments can be valued by calculating the net present value of expected future cashflows of the Investee Companies. In relation to the Company’s investments, anticipating future cashflows in excess of the guaranteed amounts would clearly require highly subjective judgements to be made in the early stage of each investment and therefore would not be an appropriate methodology to apply at such an early stage of the investment.
In the period prior to the second live event or entertainment content it is considered appropriate to use the price paid for the recent investment as the latest available information. Thereafter, the portfolio of investments is fair valued on the discounted cash flow/earnings basis using the latest available information on the performance of the live event or entertainment content. Gains or losses arising from changes in the fair value of the ‘financial assets at fair value through profit or loss’ category are presented in the Income Statement in the period in which they arise.
As a result of the above basis of valuation, there is significant judgement associated with the valuation of investments.
Non-qualifying Investments - OEICs
The Company’s Non-qualifying Investments in interest bearing money market OEICs are valued at fair value which is mid price. They have been designated as fair value through profit or loss for the purposes of FRS 26.
Gains and losses arising from changes in fair value of Qualifying and Non-qualifying Investments are recognised as part of the capital return within the Income Statement and allocated to the realised or unrealised capital reserve as appropriate. Transaction costs attributable to the acquisition or disposal of investments are charged to capital within the Income Statement.
c) Investment Income
Interest income is recognised in the Income Statement under the effective interest method. The effective interest rate is the rate required to discount the expected future income streams over the life of the loan to its initial carrying amount. The main impact for the Company in that regard is the accounting treatment of the loan note premiums. Where those loan note premiums are charged in lieu of higher interest then they are credited to income over the life of the advance to the extent those premiums are anticipated to be collected.
d) Dividend Income
Dividend income is recognised in the Income Statement once it is declared by the Investee Companies.
e) Expenses
All expenses are accounted for on an accruals basis. Expenses are charged to the revenue account within the Income Statement except that:
expenses which are incidental to the acquisition or disposal of an investment are charged to capital in the Income Statement as incurred; expenses are split and presented partly as capital items where a connection with the maintenance or enhancement of the value of the investments held can be demonstrated; and the management fee has been allocated 50% to revenue and 50% to capital, which represents the expected split of the Company’s long term returns.General expenses are paid for by the Ordinary share class and recharged on a quarterly basis to the other share classes based on the proportional net asset value per share class as at the last day of the previous quarter.
f) Deferred Taxation
Deferred taxation 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, or a right to pay less, tax in the future have occurred at the Balance Sheet date. This is subject to deferred tax assets only being recognised if it is considered more likely than not that there will be suitable profits from which the future reversal of the underlying timing differences can be deducted. Timing differences are differences arising between the Company’s taxable profits and its results as stated in the financial statements which are capable of reversal in one or more subsequent periods.
g) Ordinary shares, C shares, D shares, E shares, F shares, G shares and H shares
The Company has seven classes of shares: Ordinary shares, C shares, D shares, E shares, F shares, G shares and H shares. Each share class has a separate pool of income and expenses as well as assets and liabilities attributable to it. All share classes rank pari passu with each other in terms of voting and other rights.
2. Basic and Diluted Return per share
The calculation of basic return per Ordinary share is based on the return on ordinary activities after tax for the period and on a weighted average of 10,205,011 Ordinary shares in issue for the six months ended 30 June 2013 (31 December 2012: 10,205,011; 30 June 2012: 10,205,011). The basic return per C share has been calculated on a weighted average of 2,810,596 C shares in issue for the six months ended 30 June 2013 (31 December 2012: 2,810,596; 30 June 2012: 2,810,596). The basic return per D share has been calculated on a weighted average of 6,735,624 D shares in issue for the six months ended 30 June 2013 (31 December 2012: 6,735,624; 30 June 2012: 6,735,624). The basic return per E share has been calculated on a weighted average of 2,846,122 E shares in issue for the six months ended 30 June 2013 (31 December 2012: 2,846,122; 30 June 2012: 2,846,122). The basic return per F share has been calculated on a weighted average of 1,572,095 F shares in issue for the six months ended 30 June 2013 (31 December 2012: 1,572,095; 30 June 2012: 1,572,095). The basic return per G share has been calculated on a weighted average of 3,518,044 G shares in issue for the six months ended 30 June 2013 (31 December 2012: 2,302,126; 30 June 2012: 1,353,098). The basic return per H share has been calculated on a weighted average of 834,393 H shares in issue for the six months ended 30 June 2013 (31 December 2012: N/A; 30 June 2012: N/A).
There are no dilutive potential Ordinary shares, C shares, D shares, E shares, F shares, G shares or H shares, including convertible instruments, options or contingent share agreements in issue for the Company. The basic return per share is therefore the same as the diluted return per share.
3. Non-qualifying Investments
In order to safeguard the capital available for investment in VCT Qualifying Investments and balance this with the need to provide good returns to investors, available funds from the net proceeds are invested in appropriate securities (money market securities and cash funds) until required for Qualifying Investment purposes.
4. Net Asset Value per share
The unaudited net asset value per Ordinary share has been calculated based on 10,205,011 Ordinary shares being the number of Ordinary shares in issue as at 30 June 2013 (31 December 2012: 10,205,011; 30 June 2012: 10,205,011).
The unaudited net asset value per C share has been calculated based on 2,810,596 C shares being the number of C shares in issue as at 30 June 2013 (31 December 2012: 2,810,596; 30 June 2012: 2,810,596).
The unaudited net asset value per D share has been calculated based on 6,735,624 D shares being the number of D shares in issue as at 30 June 2013 (31 December 2012: 6,735,624; 30 June 2012: 6,735,624).
The unaudited net asset value per E share has been calculated based on 2,846,122 E shares being the number of E shares in issue as at 30 June 2013 (31 December 2012: 2,846,122; 30 June 2012: 2,846,122).
The unaudited net asset value per F share has been calculated based on 1,572,095 F shares being the number of F shares in issue as at 30 June 2013 (31 December 2012: 1,572,095; 30 June 2012: 1,572,095).
The unaudited net asset value per G share has been calculated based on 3,518,044 G shares being the number of G shares in issue as at 30 June 2013 (31 December 2012: 3,518,044; 30 June 2012: 2,756,760).
The unaudited net asset value per H share has been calculated based on 1,735,921 H shares being the number of H shares in issue as at 30 June 2013 (31 December 2012: N/A; 30 June 2012: N/A).
5. Related Party Transactions
a) The Company has appointed Ingenious Media Investments Limited, a company of which Patrick McKenna is a director, to be its promoter. Ingenious Media Investments Limited is a wholly owned subsidiary within the Ingenious Media Holdings plc group of companies (the Ingenious Group) which is controlled by Patrick McKenna. The Company incurred a fee of £52,000 which is ranging from 0.6288% and 5.5% of the gross proceeds of the offer for H shares which was paid in consideration of the service provided.
b) The Company has appointed Ingenious Ventures as Manager. Ingenious Ventures is a trading division of Ingenious Capital Management Limited. Patrick McKenna is a director of Ingenious Capital Management Limited which is a subsidiary within the Ingenious Group, which is controlled by Patrick McKenna.
The Manager, as per the management agreement, receives a management fee of 0.4375% of the net asset value payable quarterly in advance (1.75% annualised). The Manager also receives an administration fee of £110,000 per annum and irrecoverable VAT from the Company.
c) The funds invested in OEICs are managed by Ingenious Asset Management Limited, a company of which Patrick McKenna is a director. Ingenious Asset Management Limited is a subsidiary of the Ingenious Group, which is controlled by Patrick McKenna. There is no fee to the Company associated with this transaction.
d) Patrick McKenna is a director and a shareholder of Ingenious Entertainment VCT 2 plc. The Company and Ingenious Entertainment VCT 2 plc have jointly agreed to form a new company, Hop Farm Comedy Limited, to co-promote a range of comedy events that are planned for the summer of 2014. In March 2013 and June 2013 respectively, the Company invested an aggregate of £875,000 for a total of 20% of the equity in Hop Farm Comedy Limited. Ingenious Entertainment VCT 2 plc also invested £875,000 for 20% of the equity in Hop Farm Comedy Limited.
e) Patrick McKenna is a director and a shareholder of Ingenious Entertainment VCT 2 plc. The Company and Ingenious Entertainment VCT 2 plc have jointly agreed to form a new company, Saturn Star Limited, to co-promote a new festival called As One In The Park. In February 2013 the Company invested £750,000 for a total of 20% of the equity in Saturn Star Limited. Ingenious Entertainment VCT 2 plc also invested £750,000 for 20% of the equity in Saturn Star Limited.
During the period the Company has carried out a number of transactions with the above-mentioned related parties in the normal course of business and on an arm’s length basis:
| Expenditure Paid | Amounts Due | |||||||||||||||||||||||||||
| Entity | Note | 30 June2013£'000 | 30 June2012£'000 | 31 December2012£'000 | 30 June2013£'000 | 30 June2012£'000 | 31 December2012£'000 | |||||||||||||||||||||
| Ingenious Capital Management Limited/ Ingenious Asset Management Limited | ||||||||||||||||||||||||||||
| - Investment management fee | b | 188 | 188 | 374 | - | - | - | |||||||||||||||||||||
| - Administration fee | b | 53 | 42 | 90 | - | - | - | |||||||||||||||||||||
| - Irrecoverable VAT | b | - | - | - | 6 | 3 | 6 | |||||||||||||||||||||
| Ingenious Media Investments Limited | ||||||||||||||||||||||||||||
| - Arrangement fee | a | 52 | 152 | 194 | - | - | - | |||||||||||||||||||||
Transactions Between Related Parties
Ingenious Media Consulting Limited, a company which is a wholly-owned subsidiary in the Ingenious Group, which is controlled by Patrick McKenna, has entered into consultancy agreements with each of the Company’s Investee Companies to provide management services. For the provision of such services, consulting fees totalling £188,000 excluding VAT (31 December 2012: £116,000; 30 June 2012: £304,000) have been invoiced in the period of which £5,000 remained outstanding as at 30 June 2013 (31 December 2012: £24,000; 30 June 2012: £Nil).
6. Events After the Balance Sheet Date
a) In July 2013, the following investments were successfully realised: DRG Media Assets Limited, Golfmania Limited and Jetstream Events Limited.
b) In August 2013, the Company paid a dividend of 53p per share to the shareholders in the Ordinary share class. This share class is in the process of liquidation as it reached its five year investment period.
The Company’s statutory financial statements for the year ended 31 December 2012 have been delivered to the Registrar of Companies. The auditor’s report on those financial statements was unqualified and did not contain statements under Section 498 (2) or section 498 (3) of the Companies Act 2006.
This condensed interim information for the period does not constitute statutory financial statements within the meaning of s434 of the Companies Act 2006.
Copies of the half-yearly financial report are being sent, or made available electronically, to all shareholders. Further copies can be downloaded from the Company’s website: www.ingeniousvcts.co.uk
Copyright Business Wire 2013