Maven I&g 4 Regulatory News (MAV4)

Maven Income and Growth VCT 4 PLC

Final results for the year ended 31 December 2021

The Directors report the Company's financial results for the year ended 31 December 2021.

Highlights for the year

· NAV total return at the year end of 157.48p per share (2020: 148.93p)

· NAV at the year end of 74.88p per share (2020: 70.33p), after total dividend payments of 4.00p per share during the year

· Interim dividend of 2.00p per share paid in October 2021

· Further interim dividend of 2.00p per share paid in March 2022

· Final dividend of 1.00p per share proposed for payment in May 2022

· Offer for Subscription launched in September 2021 seeking to raise up to £20 million

Chairman's Statement 

On behalf of your Board, I am pleased to present the 2021 Annual Report. Despite the ongoing challenges in relation to the pandemic, your Company has made further significant progress and is reporting an uplift in NAV total return to 157.48p per share and a higher level of Shareholder distributions. This positive performance reflects the strength of the underlying portfolio, where the valuations of several private companies have been increased in line with the commercial progress achieved, whilst the AIM quoted portfolio also appreciated in value. During the year, the successful flotation on AIM of GENinCode generated a 2.7x uplift in value at the time of listing and represented the first IPO of a private company holding. Furthermore, four profitable private company realisations completed, including the highest value exit to date from the growth portfolio with the sale of Quorum Cyber, which achieved a multiple of 6.5x cost, inclusive of a retained minority interest. These realisations have supported an increased level of annual dividend reflecting the Board's commitment to maintain distributions in line with the annual 5% dividend yield target.

Overview

Throughout the financial year, COVID-19 continued to cause economic uncertainty, following a resurgence of infection rates in December 2020, which resulted in the re-introduction of protective measures and a second nationwide lockdown. The success of the UK vaccination programme enabled most restrictions to be lifted by the summer of 2021 and, as the more recent wave of infection resulting from the Omicron variant subsides, the economic prospects for the year ahead are positive.

During the year, your Company has continued to deliver its investment objective and has made further progress in line with its stated strategy of building a large and broadly based portfolio of private and AIM quoted companies that have the potential to achieve scale and generate a capital gain on exit. During the year, 14 new private and AIM quoted companies were added to the portfolio, providing exposure to a number of interesting new growth markets. In order to support the continued development and expansion of the portfolio, in late September 2021 your Company launched joint Offers for Subscription alongside Maven Income and Growth VCT 3 PLC, to raise £10 million each, with an over-allotment facility of up to a further £10 million for each company. Following good levels of early interest, it is encouraging to report that, at the time of writing, over £11.3 million has been raised by your Company. The Offer remains open until 4 April 2022 for the 2021/22 tax year and 27 May 2022 for the 2022/23 tax year, unless it is fully subscribed at an earlier date. Further details about the Offer can be found at www.mavencp.com/vctoffer.

During the year there has been significant activity across the portfolio and Shareholders will find full details of portfolio developments, including a summary of the new investments completed and realisations achieved, in the Investment Manager's Review in the Annual Report.

It has now been more than six years since the VCT rules changed and redefined the criteria for VCT qualifying investments. During this period, your Company has constructed a diverse portfolio of high growth private company holdings that operate across a broad range of sectors. Your Board is pleased to report that many of these earlier stage portfolio companies are now achieving scale and gaining commercial traction, in line with their strategic growth objectives. In certain cases, this has required a pivot of the business model to adapt to a fundamental shift in market dynamics, or to meet an emerging opportunity. Across the portfolio, most companies have delivered an improvement in performance, which is often measured in terms of growth in contracted recurring revenue. Your Board is pleased to confirm that this has resulted in uplifts to several valuations to reflect the progress achieved.

Your Company also benefits from a portfolio of later stage investments, completed prior to the change in VCT rules, and these more mature holdings remain a core component of the portfolio, helping to counterbalance the higher risk associated with investment in earlier stage companies.

Over recent years, your Company has been steadily increasing its exposure to AIM to complement the core private company holdings. Whilst financial markets have experienced periods of volatility during the year, it is encouraging to report that the AIM quoted portfolio delivered a positive overall performance. The Directors believe that selective investment in AIM provides exposure to a wide range of growth companies, often with more favourable liquidity characteristics, and it is anticipated that further new investments will be made in the year ahead. A highlight of the financial year was the successful flotation on AIM of investee company GENinCode, which completed in July 2021 and generated an uplift in value of 2.7x cost at the time of IPO, over a holding period of approximately one year. A market listing was quickly identified as a key objective for GENinCode that would help accelerate the future growth and development of the business. The ability to list on AIM provides an alternative exit strategy for certain private companies.

During the second half of the year, there has been an increase in exit activity, which has resulted in four profitable realisations. In addition to the exits from Curo Compensation, eSafe and Mojo Mortgages, which generated total returns on cost of 1.1x, 1.4x and up to 1.8x respectively, your Company also achieved its most significant return to date from the growth portfolio with the realisation of the holding in cyber security technology business Quorum Cyber. This exit achieved a total return of 6.5x cost inclusive of a retained minority holding in the business, and helps to demonstrate the ability of certain early stage companies to generate meaningful growth in Shareholder value over a relatively short holding period. Whilst the timing of exits is often hard to predict, based on the progress achieved across the portfolio, the Directors are optimistic that further profitable exits can be achieved in the year ahead to help underpin future Shareholder distributions.

COVID-19

The pandemic continued to be a dominant feature of the financial year, and the emergence of the Omicron variant in late 2021 was a timely reminder that the virus still has the potential to cause further disruption.

Historically, your Company has maintained a relatively low level of direct exposure to consumer facing sectors such as retail, leisure, travel, hospitality and entertainment, which were most severely impacted by the pandemic. The Manager's focus on investing in dynamic businesses with strong, often counter-cyclical, growth characteristics has proven to be a sound strategy, that has helped to insulate the portfolio from the worst effects of the pandemic. Encouragingly, several investee companies, specifically those that are active in the biotech or medtech space, have contributed towards the UK's efforts to tackle COVID-19, including developing testing and therapeutics, or manufacturing medical products or devices.

Since the outbreak of the pandemic in the UK, the Manager has adhered to all Government and local guidelines, with its regional offices and administration hub moving to a remote working model in March 2020. During this period, full operational capability has been maintained with no impact on the management or running of your Company. The Maven offices have now fully re-opened and it is anticipated that 2022 will see a return to a normalised office based working pattern.

Until recently most meetings of the Board and its Committee had been conducted via Microsoft Teams, which has proven to be an effective medium. However, regular face to face meetings have now resumed and, subject to any changes in Government guidance, will continue to follow the traditional in person format. It is intended that the 2022 AGM will also take place in person, full details of which can be found in the Notice of Annual General Meeting in the Annual Report.

Brexit

The UK formally left the EU on 31 January 2020 and entered into an eleven month transition period that ended on 31 December 2020, with the EU (Future Relationship) Act 2020 coming into effect on 1 January 2021.

The Manager had been working closely with portfolio companies, both prior to and during the transition period, in order to help identify any potential issues and to put in place contingency measures to mitigate against perceived problems such as supply chain disruption or staffing shortages. Furthermore, it is encouraging to report that, whilst the majority of the investee companies have limited direct exposure to the EU, there have been no significant indirect issues of note beyond the general market uncertainty that has affected the wider UK economy.

There is now greater clarity on the impact of Brexit and, whilst it is likely that there will be issues that affect the economy as a whole, the Directors are comfortable that the sectoral diversity of the portfolio, as well as its UK focus, should ensure that your Company is well positioned to benefit from future investment in the economy.

Registration Services

Following a review of the registration and receiving agency services provided by a number of suppliers, and after undertaking extensive due diligence on its service features and operations, The City Partnership (UK) Limited (City Partnership) was appointed as the Registrar to your Company and the other Maven managed VCTs with effect from 25 October 2021, and is also acting as Receiving Agent for the current joint Offers for Subscription.

Shareholders should have received a welcome letter from the new Registrar, including an invitation to register for its investor hub at: maven-cp.cityhub.uk.com/login, from where shareholdings can be monitored and amendments made to personal information and preferences. A separate enclosure from City Partnership, detailing the benefits of using the investor hub and how to register, is included with the Annual Report.

The Board and the Manager are encouraged by the performance and service provided by City Partnership to date, both in terms of the management of the share register and activities relating to the current Offers.

Dividend Policy

Decisions on distributions take into consideration a number of factors, including the realisation of capital gains, the adequacy of distributable reserves, the availability of surplus revenue and the VCT qualifying level, all of which are kept under close and regular review.

The Board and the Manager recognise the importance of tax-free distributions to Shareholders and, subject to the considerations outlined above, will seek, as a guide, to pay an annual dividend that provides Shareholders with a yield of around 5% of the NAV per share at the preceding year end. It should be noted that the effect of paying a dividend is to reduce the NAV of the Company by the total cost of the distribution.

The Directors would like to remind Shareholders that, as the portfolio continues to expand and a greater proportion of holdings are invested in early stage companies, the timing of distributions will be more closely linked to realisation activity, whilst also reflecting the Company's requirement to maintain its VCT qualifying level. If larger distributions are required as a consequence of significant exits, this will result in a corresponding reduction in NAV per share. However, your Board considers this to be a tax efficient means of returning value to Shareholders, whilst ensuring ongoing compliance with the requirements of the VCT legislation.

Further Interim Dividend and Proposed Final Dividend

Following the recent realisation activity, your Board was pleased to declare a further interim dividend of 2.00p per Ordinary Share in respect of the year ended 31 December 2021, which was paid on 11 March 2022 to Shareholders on the register at 11 February 2022.

Furthermore, your Board has proposed a final dividend of 1.00p per Ordinary Share in respect of the year ended 31 December 2021 which, subject to Shareholder approval at the forthcoming AGM, will be paid on 20 May 2022 to Shareholders on the register at 22 April 2022. This will bring total distributions for the financial year to 5.00p per Ordinary Share, representing a yield of 7.11% based on the NAV per share at the preceding year end of 70.33p. Since the Company's launch, and after receipt of the proposed final dividend, Shareholders will have received 85.60p per share in tax-free distributions.

Dividend Investment Scheme (DIS)

The Directors would like to remind Shareholders that your Company operates a DIS, through which dividend payments can be utilised to subscribe for new Ordinary Shares issued by the Company under the standing authority requested from Shareholders at Annual General Meetings. Shares issued under the DIS should qualify for VCT tax relief applicable to the tax year in which they are allotted, subject to an individual Shareholder's particular circumstances.

Shareholders can elect to participate in the DIS in respect of future dividends, including the proposed final dividend, to be paid on 20 May 2022, by completing a DIS mandate that must be received by the Registrar (City Partnership) before 6 May 2022, this being the relevant dividend election date. The mandate form, terms & conditions and full details of the scheme (including further details about tax considerations) are available from the Company's website at: www.mavencp.com/migvct4. Election to participate in the DIS can also be made through the Registrar's investor hub at: https://maven-cp.cityhub.uk.com/login.

If a Shareholder is in any doubt about the merits of participating in the DIS, or their own tax status, they should seek advice from a suitably qualified adviser.

Fund Raising

On 20 September 2021, your Company, together with Maven Income and Growth VCT 3 PLC, launched joint Offers for Subscription for new Ordinary Shares of up to £20 million in aggregate (£10 million for each company), with a combined over-allotment facility of up to £20 million (£10 million for each company).

Following good levels of early applications, an allotment of 11,772,141 new Ordinary Shares, in respect of the 2021/22 tax year, was made on 4 February 2022. Further allotments for the 2021/22 tax year will be made on or before 5 April 2022. An allotment for the 2022/23 tax year will take place on or before 3 June 2022, or earlier if the Offer has already closed. Further details regarding the new Ordinary Shares issued under the Offer for Subscription can be found in Note 12 to the Financial Statements in the Annual Report.

This additional liquidity will enable your Company to continue to expand the portfolio by investing in ambitious, growth focused private and AIM quoted companies that operate across a broad range of market sectors, and which are capable of generating capital gains. It will also ensure that existing portfolio companies that are making tangible commercial progress can continue to be supported through follow-on funding. Furthermore, the funds raised will allow your Company to maintain its share buy-back policy, whilst also spreading its costs over a wider asset base in line with the objective of maintaining a competitive total expense ratio for the benefit of all Shareholders.

Share Buy-backs

Shareholders will be aware that a primary objective for the Board is to ensure that the Company retains sufficient liquidity for making investments in line with its stated policy, and for the continued payment of dividends. However, the Directors also acknowledge the need to maintain an orderly market in the Company's shares and have, therefore, delegated authority to the Manager to buy back shares in the market for cancellation or to be held in treasury, subject always to such transactions being in the best interests of Shareholders.

It is intended that the Company will seek to buy back shares with a view to maintaining a share price discount that is approximately 5% below the latest published NAV per share, subject to market conditions, availability liquidity and the maintenance of the Company's VCT qualifying status.

VCT Regulatory Developments

During the period under review, there have been no further amendments to the rules governing VCTs. The Autumn Budget was delivered on 27 October 2021 and did not propose any changes to the legislation governing VCTs.

The Directors and the Manager continue to apply the International Private Equity and Venture Capital Valuation (IPEV) Guidelines as the central methodology for all private company valuations. The IPEV Guidelines are the prevailing framework for fair value information in the private equity and venture capital industry.

Environmental, Social and Governance (ESG)

The Board is cognisant of the importance of ESG principles and believes that each portfolio company should behave responsibly towards the environment and society, whilst operating in line with governance best practice. The Directors are pleased to report that the Manager has increased its focus on ESG and integrated these criteria into its investment appraisal process. Additionally, a robust framework has been developed to ensure that ESG considerations are monitored and managed carefully throughout the period of investment.

In May 2021, the Manager became a signatory to the internationally recognised Principles for Responsible Investment, demonstrating its commitment to include ESG as an integral part of its investment decision making and ownership. The Manager has also become a signatory to the Investing in Women Code, which aims to improve female entrepreneurs' access to tools, resources and finance, supporting diversity and inclusion in access to finance.

Whilst neither the Company nor the Manager are currently required to disclose climate related financial information in line with the Task Force on Climate related Financial Disclosures (TCFD), they recognise the aim and importance of the TCFD recommendations to provide a foundation to improve investors' ability to appropriately assess climate-related risk and opportunities. Disclosing information against the TCFD recommendations remains an objective of the Manager as part of its ESG initiatives and progress will be monitored by the Directors.

Maven Capital Partners UK LLP (Maven)

As noted in the 2021 Interim Report, Mattioli Woods plc completed the acquisition of Maven on 1 July 2021. The Directors are pleased to confirm that, following this strategic development, there has been no material change to the management of your Company. As previously outlined, Maven now operates as an independently managed subsidiary of Mattioli Woods, retaining its regional business model, team and brand in entirety, with no direct impact for Maven's VCT clients, Shareholders or investee companies. Your Board considers this to be a positive step in the evolution of Maven and does not anticipate any significant operational changes. Bill Nixon remains Managing Partner and lead VCT fund manager, and the investment team and support staff, providing company secretarial, accounting and administrative services, are all continuing to operate as before.

Mattioli Woods is one of the UK's leading providers of wealth management and financial planning services and Maven offers a highly complementary fit with its existing operations. Maven and Mattioli Woods share a common objective of continuing to expand the enlarged business under PLC ownership.

Both businesses are well known to each other and there is strong cultural alignment, as well as a common focus on providing clients with the best possible service. Further details on Mattioli Woods can be found at www.mattioliwoods.com.

Annual General Meeting (AGM)

The Directors are pleased to confirm that, subject to no variation in the guidelines in relation to the pandemic, the 2022 AGM will be held in the London office of Maven on 11 May 2022, commencing at 12.00 noon. The Notice of Annual General Meeting can be found in the Annual Report.

Constitution of the Board

As Shareholders will be aware, all of the Directors normally stand for re-election at the AGM. However, after over 17 years of service, Malcolm Graham-Wood has decided to retire from the Board with effect from the conclusion of the 2022 AGM and, therefore, will not be seeking re-election. Malcolm has served as a Director of the Company since its inception in 2004 and, during that time, it has increased in size from an initial £8 million of net assets to over £82 million as at 31 December 2021. He has been Chairman of the Risk Committee since its formation in 2014 and has also overseen several major fundraisings and three successful mergers. The Board expresses its sincere gratitude to Malcolm for his considerable contribution to the success of the Company during his time in office and wishes him every success for the future.

Ukraine

As at the date of publication of this Annual Report, global attention is focused on the evolving situation in Ukraine and the significant humanitarian issues that are unfolding. Whilst the economic impact of these developments are not yet fully known, it is likely that financial markets and commodity prices will experience some volatility over the coming period. The Board and the Manager will continue to monitor the situation closely and remain hopeful that a swift resolution can be achieved.

The Future

As the impact of the pandemic recedes and the economic recovery strengthens, your Board is optimistic for the prospects in the year ahead. Your Company has constructed a large and well balanced portfolio of investee companies that provides exposure to a diverse range of growth markets. The new capital raised through the current Offer for Subscription will help facilitate the continuation of the investment strategy, and it is anticipated that there will be further expansion and development of the portfolio during 2022. Furthermore, consistent with the high number of exits achieved during the year, continued M&A interest is anticipated across the portfolio from a range of domestic and international buyers. The key objectives and strategy are, therefore, to achieve further growth in the size and breadth of the investee company portfolio, whilst pursuing selective exits to maintain a programme of regular tax-free distributions.

Peter Linthwaite

Chairman

22 March 2022

Business Report

This Business Report is intended to provide an overview of the strategy and business model of the Company, as well as the key measures used by the Directors in overseeing its management. The Company is a VCT and invests in accordance with the investment objective set out below.

Investment Objective

Under an investment policy approved by the Directors, the Company aims to achieve long-term capital appreciation and generate income for Shareholders.

Business Model and Investment Policy

The Company intends to achieve its objective by:

• investing the majority of its funds in a diversified portfolio of shares and securities in smaller, unquoted UK companies and AIM/AQSE quoted companies that meet the criteria for VCT qualifying investments and have strong growth potential;

• investing no more than £1.25 million in any company in one year and no more than 15% of the Company's assets by cost in one business at any time; and

• borrowing up to 15% of net asset value, if required and only on a selective basis, in pursuit of its investment strategy.

Principal and Emerging Risks and Uncertainties

The Board and the Risk Committee have an ongoing process for identifying, evaluating and monitoring the principal and emerging risks and uncertainties facing the Company. The risk register and dashboard form key parts of the Company's risk management framework used to carry out a robust assessment of the risks, including a significant focus on the controls in place to mitigate them. The principal and emerging risks and uncertainties facing the Company are as follows:

Investment Risk

The majority of the Company's investments are in small and medium sized unquoted UK companies and AIM/ AQSE quoted companies which, by their nature, carry a higher level of risk and lower liquidity than investments in large quoted companies. The Board aims to limit the risk attached to the investment portfolio as a whole by ensuring that a robust and structured selection, monitoring and realisation process is applied by Maven. The Board reviews the investment portfolio with the Manager on a regular basis.

The Company manages and minimises investment risk by:

• diversifying across a large number of companies;

• diversifying across a range of economic sectors;

• actively and closely monitoring the progress of investee companies;

• co-investing with other clients of Maven, other VCT managers and co-investment partners;

• ensuring valuations of underlying investments are made fairly and reasonably (see Notes to the Financial Statements 1(e), 1(f) and 16 in the Annual Report for further details);

• taking steps to ensure that the share price discount is managed appropriately; and

• choosing and appointing an FCA authorised investment manager with the skills, experience and resources required to achieve the investment objective, with ongoing monitoring to ensure the Manager is performing in line with expectations.

Operational Risk

The Board was aware of the heightened cyber security risk and potential consequences of IT failure during the pandemic, particularly in relation to the reliance on remote working practices employed by the Manager and key third parties during this period. The Board has closely monitored the systems and controls in place to prevent or mitigate against a systems or data security failure, and the overall effectiveness of business continuity arrangements of the Manager and third parties.

VCT Qualifying Status Risk

The Company operates in a complex regulatory environment and faces a number of related risks, including:

• becoming subject to capital gains tax on the sale of its investments as a result of a breach of Section 274 of the Income Tax Act 2007;

• loss of VCT status and consequent loss of tax reliefs available to Shareholders as a result of a breach of the VCT Regulations;

• loss of VCT status and reputational damage as a result of a serious breach of other regulations such as the FCA Listing Rules and the Companies Act 2006; and

• increased investment restrictions resulting from EU State Aid Rules, incorporated by the Finance (No. 2) Act 2015 and the Finance Act 2018.

The Board works closely with the Manager to ensure compliance with all applicable and upcoming legislation, such that VCT qualifying status is maintained. Further information on the management of this risk is detailed under other headings in this Business Report.

Legislative and Regulatory Risk

The Directors strive to maintain a good understanding of the changing regulatory agenda and consider emerging issues so that appropriate changes can be implemented and developed in good time. In order to maintain its approval as a VCT, the Company is required to comply with current VCT legislation in the UK as well as the EU State Aid Rules. Changes to either legislation could have an adverse impact on Shareholder investment returns, whilst maintaining the Company's VCT status. The Board and the Manager continue to make representations where appropriate, either directly or through relevant industry bodies such as the Association of Investment Companies (AIC), the British Venture Capital Association (BVCA) and the Venture Capital Trust Association (VCTA).

The Company has retained Philip Hare & Associates LLP as its principal VCT adviser and also uses the services of a number of other VCT advisers on a transactional basis.

Breaches of other regulations including, but not limited to, the Companies Act, the FCA Listing Rules, the FCA Disclosure Guidance and Transparency Rules, the General Data Protection Regulation (GDPR), and the Alternative Investment Fund Managers Directive (AIFMD), could lead to a number of detrimental outcomes and reputational damage. Breaches of controls by service providers to the Company could also lead to reputational loss or damage.

The AIFMD, which regulates the management of alternative investment funds, including VCTs, introduced an authorisation and supervisory regime for all investment companies in the EU. The Company is a small registered, internally managed alternative investment fund under the AIFMD, and its status as such is unchanged as a result of the UK's departure from the EU. The Company is also required to comply with tax legislation under the Foreign Account Tax Compliance Act and the Common Reporting Standard. The Company has appointed City Partnership to act on its behalf to report annually to HM Revenue & Customs (HMRC) and ensure compliance with this legislation.

Climate Change and Social Responsibility Risk

The Board recognises that climate change is an important emerging risk that all companies should take into consideration within their strategic planning.

As referred to elsewhere in this Strategic Report and in the Statement of Corporate Governance, the Company has little direct impact on environmental issues. However, the Company has introduced measures to reduce the cost and environmental impact of the production and circulation of Shareholder documentation such as the annual and interim reports. This has resulted in a significant reduction in the number of copies being printed and posted, with fewer than 15% of Shareholders now receiving paper reports.

The Board is aware that the Manager is increasing efforts in relation to the identification of environmental risks and opportunities, and is developing its ESG policy accordingly. Environmental risk is a fundamental aspect of due diligence and industry specialists are assigned where there may be specific concerns in relation to a potential business or sector. The results are then factored into the decision making process for new investments. VCTs in general are regarded as supporting small and medium sized enterprises, which helps to create local employment opportunities across a range of UK geographical regions.

Other Key Risks

Governance Risk

The Directors are aware that an ineffective Board could have a negative impact on the Company and its Shareholders. The Board recognises the importance of effective leadership and board composition and this is ensured by completing an annual evaluation process, with action being taken if required.

Management Risk

The Directors are aware of the risk that investment opportunities could fail to complete, or the management of the VCT could breach the Management and Administration Deed or regulatory parameters, due to lack of knowledge and/or experience of the investment professionals acting on behalf of the Company. To manage this risk, the Board has appointed Maven as investment manager, as it employs skilled professionals with the required VCT knowledge and experience. In addition, the Board takes comfort that the Manager's controls have been updated to ensure compliance with the Senior Managers and Certification Regime (SMCR).

The Directors are also mindful of the impact that the loss of the Manager's key employees could have on both investment opportunities that may be lost or existing investments that may fail. The Board is reassured by the Manager's approach to incentivising staff and ensuring that adequate notice periods are included in all contracts of employment.

Financial and Liquidity Risk

As most of the investments require a medium to long- term commitment and are relatively illiquid, the Company retains a portion of the portfolio in cash and listed investment trusts in order to finance any new or follow-on investment opportunities. The Company has only limited direct exposure to currency risk and does not enter into any derivative transactions.

Political Risk

The EU (Future Relationship) Act 2020 came into effect on 1 January 2021 and, while the full political, economic and legal consequences of the UK leaving the EU are not yet known, the majority of the investee companies have limited direct exposure to the EU and there have been no significant indirect issues of note beyond the general market uncertainty that has affected the wider UK economy. It is possible that investments in the UK may be more difficult to value and assess for suitability of risk, harder to buy or sell and, therefore, there will be a greater level of subjectivity in their valuations. In the longer term, there is likely to be a period of uncertainty as the UK seeks to negotiate its ongoing relationship with the EU and other global trade partners.

In the future, UK laws and regulations, including those relating to investment companies and AIFMs, may diverge from those of the EU. This may lead to changes in the operation of the Company, the rights of investors, or the list of territories in which the shares of the Company can be promoted or sold.

The Board reviews the political situation regularly, together with any associated changes to the economic, regulatory and legislative environment, in order to ensure that any risks are mitigated as effectively as possible.

Economic Risk

The valuation of investment companies may be affected by underlying economic conditions such as fluctuating interest rates and the availability of bank finance, which can be impacted during times of geopolitical uncertainty and fluctuating markets, including during the coronavirus pandemic. Investee companies may also be directly impacted by the economic effects of the pandemic, such as insufficient funds to carry the business through the crisis, market conditions affecting their valuations or the risk of lockdown restrictions limiting the ability to conduct new business or recruitment. The Manager has provided enhanced support and oversight to investee companies where needed and, in some cases, can consider follow- on funding. The diverse portfolio of the Company has limited the overall impact of the economic effects of the pandemic. The economic and market environment is kept under constant review and the investment strategy of the Company adapted, so far as is possible, to mitigate emerging risks.

Credit Risk

The Company may hold financial instruments and cash deposits and is dependent on counterparties discharging their agreed responsibilities. The Directors consider the creditworthiness of the counterparties to such instruments and seek to ensure that there is no undue concentration of exposure to any one party.

An explanation of certain economic and financial risks and how they are managed is contained in Note 16 to the Financial Statements in the Annual Report.

Statement of Compliance with Investment Policy

The Company is adhering to its stated investment policy and managing the risks arising from it. This can be seen in various tables and charts throughout the Annual Report, and from information provided in the Chairman's Statement and in the Investment Manager's Review. A review of the Company's business, its financial position as at 31 December 2021 and its performance during the year then ended is included in the Chairman's Statement, which also includes an overview of the Company's business model and strategy.

The management of the investment portfolio has been delegated to Maven, which also provides company secretarial, administrative and financial management services to the Company. The Board is satisfied with the depth and breadth of the Manager's resources and its nationwide network of offices, which supply new deals and enable it to monitor the geographically widespread portfolio of companies effectively.

The Investment Portfolio Summary in the Annual Report discloses the investments in the portfolio and the degree of co-investment with other clients of the Manager. The Portfolio Analysis in the Annual Report shows the profile of the portfolio by industry sector and by value. It also shows the hybrid composition of the portfolio and the balance between growth capital investments, more mature investments and AIM/AQSE quoted investments. The level of VCT qualifying investments is monitored continually by the Manager and reported to the Risk Committee quarterly, or as otherwise required.

Key Performance Indicators (KPIs)

During the year, the net return on ordinary activities before taxation was £9,392,000 (2020: £2,721,000); gains on investments were £12,143,000 (2020: £4,463,000) and earnings per share were 8.47p (2020: 2.45p). The Directors also use a number of APMs in order to assess the Company's success in achieving its objectives and also enable Shareholders and prospective investors to gain an understanding of its business. These APMs are shown in the Financial Highlights in the Annual Report.

In addition, the Board considers the following to be KPIs:

• NAV total return;

• annual yield;

• share price discount to NAV;

• investment income; and

• operational expenses.

The NAV total return is considered to be a more appropriate long-term measure of Shareholder value as it includes the current NAV per share and the sum of dividends paid to date. The annual yield is the total of dividends paid per share for the financial year, expressed as a percentage of the NAV per share at the previous year end. The Directors seek to pay dividends to provide a yield and comply with the VCT rules, taking account of the level of distributable reserves, profitable realisations in each accounting period and the Company's future cash flow projections. The share price discount to NAV is the percentage by which the mid- market price of a share is lower than its NAV per share.

Definitions of these APMs can be found in the Glossary in the Annual Report. A historical record of some of these measures is shown in the Financial Highlights in the Annual Report and the change in the profile of the portfolio is reflected in the Summary of Investment Changes in the Annual Report. The Board reviews the Company's investment income and operational expenses on a quarterly basis, as the Directors consider that both of these elements are important components in the generation of Shareholder returns. Further information can be found in Notes 2 and 4 to the Financial Statements in the Annual Report.

There is no VCT index against which to compare the financial performance of the Company. However, for reporting to the Board and Shareholders, the Manager uses comparisons with the most appropriate index, being the FTSE AIM All-Share Index. The Directors also consider non-financial performance measures, such as the flow of investment proposals, and ranking of the VCT sector by independent analysts. In addition, the Directors will consider economic, regulatory and political trends and factors that may impact on the Company's future development and performance.

Valuation Process

Investments held by the Company in unquoted companies are valued in accordance with the IPEV Guidelines. Investments quoted or traded on a recognised stock exchange, including AIM, are valued at their bid prices.

Share Buy-backs

At the forthcoming AGM, the Board will seek the necessary Shareholder authority to continue to conduct a share buy-back programme under appropriate circumstances.

The Board's Duty and Stakeholder Engagement

The Directors recognise the importance of an effective Board and its ability to discuss, review and make decisions to promote the long-term success of the Company and protect the interests of its key stakeholders. As required by Provision 5 of the AIC Code (and in line with the UK Code), the Board has discussed the Directors' duty under Section 172 of the Companies Act and how the interests of key stakeholders have been considered in the Board discussions and decision making during the year.

This has been summarised in the table below:

Employee, Environmental and Human Rights Policy

As a VCT, the Company has no direct employee or environmental responsibilities, nor is it responsible directly for the emission of greenhouse gases. The Board's principal responsibility to Shareholders is to ensure that the investment portfolio is managed and invested properly. As the Company has no employees, it has no requirement to report separately on employment matters. The Board comprises five male Directors and delegates responsibility for diversity to the Nomination Committee, as explained in the Statement of Corporate Governance in the Annual Report. The management of the portfolio is undertaken by the Manager through members of its portfolio management team.

The Manager engages with the Company's underlying investee companies in relation to their corporate governance practices and in developing their policies on social, community and environmental matters. Further information can be found in the Statement of Corporate Governance. Additional work is being carried out by the Manager to establish a framework for the effective capture of ESG information, consistently across all investee companies. Maven will be overseeing the collation of this information for the benefit of the Board but will also be supporting individual investee companies to identify their ESG risks and opportunities and, where potential improvements are identified, will work jointly with the business to make positive changes.

In light of the nature of the Company's business, there are no relevant human rights issues and, therefore, the Company does not have a human rights policy.

Independent Auditor

The Company's Independent Auditor is required to report if there are any material inconsistencies between the content of the Strategic Report and the Financial Statements. The Independent Auditor's Report can be found in the Annual Report.

Future Strategy

The Board and the Manager intend to maintain the policies set out above for the year ending 31 December 2022, as it is believed that these are in the best interests of Shareholders.

Approval

The Business Report, and the Strategic Report as a whole, was approved by the Board of Directors and signed on its behalf by:

Peter Linthwaite

Director

22 March 2022

Income Statement

For the year ended 31 December 2021

All gains and losses are recognised in the Income Statement.

All items in the above statement are derived from continuing operations. The Company has only one class of business and one reportable segment, the results of which are set out in the Income Statement and Balance Sheet. The Company derives its income from investments made in shares, securities and bank deposits.

There are no potentially dilutive capital instruments in issue and, therefore, no diluted earnings per share figures are relevant. The basic and diluted earnings per share are, therefore, identical.

The Notes are an integral part of the Financial Statements and can be found in full in the Annual Report.

Statement of Changes in Equity

For the year ended 31 December 2021

Year Ended 31 December 2021

Year Ended 31 December 2020

The capital reserve unrealised is generally non-distributable other than the part of the reserve relating to gains/(losses) attributable to readily realisable quoted investments which are distributable.

The Notes are an integral part of the Financial Statements and can be found in full in the Annual Report.

Balance Sheet

As at 31 December 2021

The Financial Statements of Maven Income and Growth VCT 4 PLC, registered number SC272568, were approved by the Board of Directors and were signed on its behalf by:

Peter Linthwaite

Director

22 March 2022

The Notes are an integral part of the Financial Statements and can be found in full in the Annual Report.

Cash Flow Statement

For the Year Ended 31 December 2021

The Notes are an integral part of the Financial Statements and can be found in full in the Annual Report.

Notes to the Financial Statements

For the year ending 31 December 2021

Accounting policies

The Company is a public limited company, incorporated in Scotland and its registered office is shown in the Corporate Summary in the Annual Report.

(a) Basis of preparation

The Financial Statements have been prepared on a going concern basis, including an assessment of the impact of COVID-19 on the finances of the Company, as covered in the Directors' Report in the Annual Report. The Financial Statements have been prepared under the historical cost convention, as modified by the revaluation of investments and in accordance with FRS 102, The Financial Reporting Standard applicable in the UK and Republic of Ireland, and in accordance with the Statement of Recommended Practice for Investment Trust Companies and Venture Capital Trusts (the SORP) issued by the AIC in April 2021.

(b) Income

Dividends receivable on equity shares and unit trusts are treated as revenue for the period on an ex-dividend basis. Where no ex-dividend date is available dividends receivable on or before the year end are treated as revenue for the period. Provision is made for any dividends not expected to be received. The fixed returns on debt securities and non-equity shares are recognised on a time apportionment basis so as to reflect the effective interest rate on the debt securities and shares. Provision is made for any income not expected to be received. Interest receivable from cash and short term deposits and interest payable are accrued to the end of the year.

(c) Expenses

All expenses are accounted for on an accruals basis and charged to the Income Statement. Expenses are charged through the revenue account except as follows:

· expenses that are incidental to the acquisition and disposal of an investment are charged to capital;

· expenses are charged to realised capital reserves where a connection with the maintenance or enhancement of the value of the investments can be demonstrated. In this respect the investment management fee and performance fee has been allocated 20% to revenue and 80% to special distributable reserve to reflect the Company's investment policy and prospective income and capital growth; and

· share issue and merger costs are charged to the share premium account.

(d) 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 tax in the future or 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 that are capable of reversal in one or more subsequent periods.

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

The tax effect of different items of income/gain and expenditure/loss is allocated between capital reserves and revenue account on the same basis as the particular item to which it relates using the Company's effective rate of tax for the period.

UK corporation tax is provided at amounts expected to be paid/recovered using the tax rates and laws that have been enacted or substantively enacted at the balance sheet date.

(e) Investments

In valuing unlisted investments the Directors follow the criteria set out below. These procedures comply with the revised IPEV Guidelines for the valuation of private equity and venture capital investments. Investments are recognised at their trade date and are designated by the Directors as fair value through profit or loss. At subsequent reporting dates, investments are valued at fair value, which represent the Directors' view of the amount for which an asset could be exchanged between knowledgeable willing parties in an arm's length transaction. This does not assume that the underlying business is saleable at the reporting date or that its current shareholders have an intention to sell their holding in the near future.

A financial asset or liability is generally derecognised when the contract that gives rise to it is settled, sold, cancelled or expires.

1. For early stage investments completed in the reporting period, fair value is determined using the Price of Recent Investment, calibrating for any material change in the trading circumstances of the investee company.

Other early stage investments are valued using a milestone approach, in particular where it is considered there are no deemed current or short-term future maintainable earnings or positive cashflows.

2. Whenever practical, recent investments will be valued by reference to a material arm's length transaction or a quoted price.

3. Mature companies are valued by applying a multiple to their maintainable earnings to determine the enterprise value of the company.

3.1 To obtain a valuation of the total ordinary share capital held by management and the institutional investors, the value of third party debt, institutional loan stock, debentures and preference share capital is deducted from the enterprise value. The effect of any performance related mechanisms is taken into account when determining the value of the ordinary share capital.

3.2 Preference shares, debentures and loan stock are valued using the Price of Recent Investment Method.

When a redemption premium has accrued, this will only be valued if there is a reasonable prospect of it being paid. Preference shares which carry a right to convert into ordinary share capital are valued at the higher of the Price of Recent Investment Method basis and the price/earnings basis, both described above.

4. In the absence of evidence of a deterioration, or strong defensible evidence of an increase in value, the fair value is determined to be that reported at the previous balance sheet date.

5. All unlisted investments are valued individually by the Manager's portfolio management team. The resultant valuations are subject to detailed scrutiny and approval by the Directors of the Company.

6. In accordance with normal market practice, investments quoted on AIM or a recognised stock exchange are valued at their bid market price.

(f) Fair value measurement

Fair value is defined as the price that the Company would receive upon selling an investment in a timely transaction to an independent buyer in the principal or the most advantageous market of the investment. A three-tier hierarchy has been established to maximise the use of observable market data and minimise the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes. Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk, for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique. Inputs may be observable or unobservable.

Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity.

Unobservable inputs are inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on best information available in the circumstances.

The three-tier hierarchy of inputs is summarised in the three broad levels listed below.

· Level 1 - the unadjusted quoted price in an active market for identical assets or liabilities that the entity can access at the measurement date.

· Level 2 - inputs other than quoted prices included within Level 1 that are observable (i.e. developed using market data) for the asset or liability, either directly or indirectly.

· Level 3 - inputs are unobservable (i.e. for which market data is unavailable) for the asset or liability.

(g) Gains and losses on investments

When the Company sells or revalues its investments during the year, any gains or losses arising are credited/ charged to the Income Statement.

(h) Critical accounting judgements and key sources of estimation uncertainty

Disclosure is required of judgements and estimates made by the Board and the Manager in applying the accounting policies that have a significant effect on the Financial Statements. The area involving the highest degree of judgement and estimates is the valuation of early stage unlisted investments recognised in Note 8 in the Annual Report and explained in Note 1 (e) above.

In the opinion of the Board and the Manager, there are no critical accounting judgements.

Reserves

Share premium account

The share premium account represents the premium above nominal value received by the Company on issuing shares net of issue costs. This reserve is non-distributable.

Capital redemption reserve

The nominal value of shares repurchased and cancelled is represented in the capital redemption reserve. This reserve is non-distributable.

Capital reserve - unrealised

Increases and decreases in the fair value of investments are recognised in the Income Statement and are then transferred to the capital reserve unrealised account. This reserve is non-distributable.

Capital reserve - realised

Gains or losses on investments realised in the year that have been recognised in the Income Statement are transferred to the capital reserve realised account on disposal. Furthermore, any prior unrealised gains or losses on such investments are transferred from the capital reserve unrealised account to the capital reserve realised account on disposal. This reserve is distributable.

Special distributable reserve

The total cost to the Company of the repurchase and cancellation of shares is represented in the special distributable reserve account. The special distributable reserve also represents capital dividends, capital investment management fees and the tax effect of capital items. This reserve is distributable.

Revenue reserve

The revenue reserve represents accumulated profits retained by the Company that have not been distributed to Shareholders as a dividend. This reserve is distributable.

Return per Ordinary Share

Net asset value per Ordinary Share

The net asset value per Ordinary Share as at 31 December 2021 has been calculated using the number of Ordinary Shares in issue at that date of 109,929,961 (2020: 112,005,928).

Directors Responsibility Statement

The Directors confirm that, to the best of their knowledge:

• the Financial Statements have been prepared in accordance with the applicable accounting standards and give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company as at 31 December 2021 and for the year to that date;

• the Directors' Report includes a fair review of the development and performance of the Company, together with a description of the principal and emerging risks and uncertainties that it faces; and

• the Annual Report and Financial Statements taken as a whole is fair, balanced and understandable and provides the information necessary for Shareholders to assess the Company's position and performance, business model and strategy.

Other information

The AGM will be held on Wednesday, 11 May 2022, commencing at 12.00 noon, at the offices of Maven Capital Partners UK LLP, 1-2 Royal Exchange Buildings, London, EC3V 3LF.

Copies of this announcement and the Annual Report and Financial Statements for the year ended 31 December 2021, will be available to the public at: the registered office of the Company, Kintyre House, 205 West George Street, Glasgow G2 2LW; the offices of Maven Capital Partners UK LLP, Fifth Floor, 1-2 Royal Exchange Buildings, London EC3V 3LF; and on the Company's website at www.mavencp.com/migvct4.

The Annual Report and Financial Statements for the year ended 31 December 2021 will be issued to Shareholders and filed with the Registrar of Companies in due course.

The financial information contained within this announcement does not constitute the Company's statutory Financial Statements as defined in the Companies Act 2006. The statutory Financial Statements for the year ended 31 December 2020 have been delivered to the Registrar of Companies and contained an audit report that was unqualified and did not constitute statements under S498(2) or S498(3) of the Companies Act 2006.

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

The Annual Report will be submitted to the National Storage Mechanism and will be available for inspection at: www.fca.org.uk/markets/primary-markets/regulatory-disclosures/national-storage-mechanism.

By Order of the Board

Maven Capital Partners UK LLP

Secretary

22 March 2022