Maven Income 1 Regulatory News (MIG1)

Maven Income and Growth VCT PLC

Final results for the year ended 28 February 2014

The Directors are pleased to report the Company's financial results for the year ended 28 February 2014.

Chairman's Statement

I am pleased to announce another positive set of results for your Company, with net assets reaching £31 million and a combination of profitable realisations and valuation uplifts driving an increase in NAV total return for the fifth consecutive year.

The Board is committed to seeing the level of dividend payments rise year on year, subject to the performance of the underlying portfolio, and in that regard I am pleased to report that we have been able to increase the total dividend again this year, to 5.7p per share.

The Manager's strategy of providing capital to later-stage income generating private companies, and managing them to profitable exits, has resulted in several meaningful realisations during the year, which together with the selective disposal of AIM quoted holdings, has generated cash proceeds of £5.9 million. Those funds have been re-invested to expand the private equity asset base further, and during the period a total of £8.6 million was deployed by your Company in ten new private equity transactions, an initial draw down on a committed facility and six follow-on investments supporting existing businesses.

Developments of note within the portfolio are detailed in the Investment Manager's Review on pages 18 to 24 of the Annual Report, where it will be seen that most of the investee companies are trading positively. During the year Lawrence Recycling & Waste Management and Training for Travel experienced difficult periods, resulting in their values being reduced or written off. Conversely, several businesses, including Torridon (Gibraltar), Nenplas Holdings and Steminic, have performed well, which has been reflected in their valuations being increased.

The Manager will continue the policy of disposing of AIM quoted holdings for best possible value in cases where the investments are underperforming or where there is an opportunity to lock in profits.

We are also pleased to note that Maven's success as a private equity manager has continued to be acknowledged, with a range of nominations and awards across the UK which recognise the quality of the investment team and your Company's portfolio.

Dividends

The Board recommends that a final dividend of 3.5p per Ordinary Share be paid on 18 July 2014 to Shareholders on the register on 20 June 2014. This brings total dividends for the year to 5.7p per share, representing a yield of 8.6% based on the year end closing share price of 66.5p.

Since the Company's launch, and after receipt of the proposed final dividend, Shareholders will have received 58.8p per share to date in tax-free dividends. The effect of paying the proposed final dividend would be to reduce the NAV of the Company by the total cost of the distribution.

New Annual Reporting Requirements

Changes have been made to the narrative reporting requirements for annual reports in respect of years ending on or after 30 September 2013 and, therefore, this report includes a Strategic Report, a revised format for the Directors' Remuneration Report (including a new Remuneration Policy Report) and a number of other consequent changes including enhanced reports on the activities of the Audit Committee.

Fund Raising and Share Buy-backs

Following the success of the Offer for Subscription that opened in January 2013 and closed fully subscribed in February 2013, in September 2013 the Company announced that it planned to raise up to £4 million in a joint Offer for Subscription alongside the other Maven VCTs.

The full terms of the Offer, which included an over-allotment facility to allow the Company to raise a further £1 million, were set out in a detailed Prospectus that was issued on 24 October 2013, along with a Circular explaining the necessary authorities required for the Offer to proceed, which were duly confirmed at a General Meeting held on 27 November 2013. Updated information was provided in the Supplementary Prospectuses issued on 10 February, 17 March, 7 April and 24 April 2014.

The Company may use the money raised under the Offers to pay dividends and general running costs, thereby preserving for investment purposes an equivalent sum of more valuable 'old money' which operates under more advantageous VCT regulations. The proceeds of the Offers will provide additional liquidity for the Company to make further later-stage investments, and enable it to spread its costs over a larger asset base to the benefit of all Shareholders.

The first allotment under the Offer took place on 3 February 2014, when 3,561,029 new Ordinary Shares were issued, and a further allotment of 1,892,783 new Ordinary Shares took place on 5 April 2014. The Offer was fully subscribed by 4 April 2014, and closed on 5 April 2014 in relation to the tax year 2013/14.

In consideration of certain provisions contained within The Finance Bill 2014, which could have had adverse tax consequences for the Company and its Shareholders, the Board decided to postpone the issue of new shares under the Offer in respect of the 2014/15 tax year until there was certainty that the allotments could take place without contravening the new rules. HM Treasury has now clarified the operation of the proposed changes to regulations, and the Offer was subsequently closed on 30 May 2014. A final allotment of new Ordinary Shares will take place in June 2014 using the over-allotment facility set out in the Prospectus.

Shareholders should be aware that the Board's primary objective is for the Company to retain sufficient liquid assets for making investments in line with its stated policy and for the continued payment of dividends to Shareholders. However, the Directors also acknowledge the need to maintain an orderly market in the Company's shares and have delegated authority to the Manager to buy back shares in the market for cancellation, subject always to such transactions being in the best interest of Shareholders. It is intended that, subject to market conditions, available liquidity and the maintenance of the Company's VCT status, shares will be bought back at prices representing a discount in the range of 5% to 10% to the prevailing NAV per share.

VCT Regulatory Developments

The Association of Investment Companies (AIC) worked closely with the Financial Services Authority (FSA) on Consultation Paper 12-19 (restrictions on the retail distribution of unregulated collective investment schemes and close substitutes) and its applicability to venture capital trusts. The Board supported the AIC in calling on the FSA to exclude VCTs from the proposals, as investment trusts had been, and was pleased to note the subsequent announcement by the FCA, which replaced the FSA, that VCTs had been excluded from the marketing restrictions.

The Alternative Investment Fund Managers Directive (AIFMD) came into force on 21 July 2011 and was implemented within the UK on 22 July 2013. The AIC has published a briefing paper reviewing the key issues, including confirmation that the UK will impose a compliance deadline of July 2014. The Board and the Manager have engaged legal advisers to ensure that the impact of the legislation has been considered fully, and the Directors have taken the decision to register Maven

Income and Growth VCT PLC as a self-managed small registered AIFM. This will enable the Company to take advantage of the reduced reporting requirements and avoid the direct and indirect costs of appointing a depositary; the application was submitted on 22 January 2014.

The AIC has participated in a consultation process to ensure the Government's continued long-term support for the VCT sector by addressing concerns from HM Treasury that enhanced shared buy-back (EBB) schemes conflict with the public policy objectives of venture capital trusts. Whilst it is proposed that the buy-back and cancellation of shares will continue to be permitted, it is the Government's intention through the Finance Bill that EBBs will be prohibited.

HM Treasury has published draft legislation to address its concerns about the use of share premium accounts to return capital to investors, which will prevent VCT s returning capital within three years of the accounting period in which the shares were issued. These changes are effective from 6 April 2014 but, as the provisions may affect the ability to pay dividends out of reserves created from the reduction of share premium or capital where the VCT has issued shares of the same class before and after 5 April 2014, the AIC sought clarification on this matter. HMRC has confirmed that it is the intention that the new rule will apply only in respect of returns of capital from shares issued on or after 6 April 2014, and that the draft legislation will be amended prior to receiving Royal Assent.

Annual General Meeting (AGM)

In light of the geographic spread of the Company's investor base, in order to allow more Shareholders the opportunity to meet the Directors and the Manager, it is intended to continue to hold Annual General Meetings in Glasgow and London in alternate years. Therefore, the 2014 AGM will be held in the Glasgow office of Maven Capital Partners UK LLP (Maven) on

10 July 2014, and the Notice of Annual General Meeting can be found on pages 72 to 76 of the Annual Report.

The Future

The Manager has a track record of successfully investing in later-stage entrepreneurial companies and structuring investments to generate sustainable levels of income, which is an important element in meeting the objective of maintaining a progressive dividend programme. The Company's asset base has developed further during the year under review, with a number of significant new investments being added to the portfolio, and the Board believes the approach adopted by the Manager will continue to deliver strong results and growth in Shareholder value.

John Pocock

Chairman

6 June 2014

Strategic Report

This Strategic Report has been prepared by the Directors in accordance with Section 414 of the Companies Act 2006, as amended. The Company's Auditor is required to report if there are any material inconsistencies between this Report and the Financial Statements.

The Board

The Board, which is responsible for setting and monitoring the Company's strategy, currently consists of four non-executive Directors, three of whom are male. The names and biographies of the Directors, as set out under Your Board on pages 7 and 8 of the Annual Report, indicate their range of investment, commercial and professional experience. Further details are also provided in the Directors' Report on page 35 and the Statement of Corporate Governance on pages 44 to 46.

Investment Objective

The Company aims to achieve long term capital appreciation and generate maintainable levels of income for Shareholders.

Statement of Investment Policy

Under an investment policy approved by the Directors, 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/ISDX quoted companies which meet the criteria for VCT qualifying investments and have strong growth potential;

· investing no more than £1 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 Risks and Uncertainties

The principal risks and uncertainties facing the Company are as follows:

Investment Risk

Many of the Company's investments are in small and medium sized unlisted and AIM/ISDX quoted companies which, by their nature, entail a higher level of risk and lower liquidity than investments in large quoted companies. The Board aims to limit the risk attaching to the investment portfolio as a whole by ensuring a structured selection, monitoring and realisation process. 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;

· seeking to appoint a non-executive director to the board of each private investee company, provided from the Manager's investment management team or from its pool of experienced independent directors;

· co-investing with other funds run by the Manager in larger deals, which tend to carry less risk;

· not investing in hostile public to private transactions; and

· retaining the services of a Manager that can provide the resources required to achieve the investment objective and meet the criteria stated above.

An explanation of certain risks and how they are managed is contained in Note 17 to the Financial Statements.

Financial and Liquidity Risk

As most of the investments require a mid to long term commitment and are relatively illiquid, the Company retains a portion of the portfolio in cash or cash equivalents in order to finance any new unquoted investment opportunities. The Company has no direct exposure to currency risk and does not enter into any derivative transactions.

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.

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.

Internal Control Risk

The Board reviews regularly the system of internal controls, both financial and non-financial, operated by the Company and the Manager. These include controls designed to ensure that the Company's assets are safeguarded and that all records are complete and accurate.

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 currently available to Shareholders as a result of a breach of the VCT Regulations; and

· loss of VCT status and reputational damage as a result of serious breach of other regulations such as the UKLA Listing Rules and the Companies Act 2006.

Legislative and Regulatory Risk

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 European Commission's (EC) state aid rules. Changes in the future to UK legislation or the EC state aid rules 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) or the British Venture Capital Association (BVCA).

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 the Investment Manager's Review. A review of the Company's business, its position as at 28 February 2014 and its performance during the year then ended is included in the Chairman's Statement, which also includes an overview of its strategy and business model.

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 network of offices, which supply new deals and enable it to monitor the geographically widespread portfolio of companies effectively.

The Investment Portfolio Summary on pages 31 and 32 of the Annual Report discloses the investments in the portfolio and the degree of co-investment with other clients of the Manager. The tabular analysis of the unlisted and quoted portfolio by industry sector and deal type on pages 16 and 17 show that the portfolio is diversified across a variety of sectors and deal types. The level of VCT qualifying investment is monitored by the Manager on a daily basis and reported to the Board quarterly.

Key Performance Indicators

At each Board Meeting, the Directors consider a number of financial performance measures to assess the Company's success in achieving its objectives, and these also enable Shareholders and investors to gain an understanding of its business. The key performance indicators are as follows:

· NAV total return;

· dividends per share;

· investment income; and

· operational expenses.

The NAV total return is a measure of Shareholder value that includes both the current NAV per share and the sum of dividends paid to date. The dividends per share measure shows how much of that Shareholder value has been returned to original investors in the form of dividends. A historical record of these measures is shown in the Financial Highlights on page 5 of the Annual Report and the profile of the portfolio is reflected in the Summary of Investment Changes on page 12. The Board reviews the Company's investment income and operational expenses on a quarterly basis.

There is no meaningful venture capital trust index against which to compare the financial performance of the Company, but for reporting to the Board and Shareholders, the Manager uses comparisons with appropriate indices and the Company's peer group. The Directors also consider non-financial performance measures such as the flow of investment proposals and ranking of the VCT sector by independent analysts.

As mentioned below, the Company has no direct employee or environmental responsibilities but the Directors will consider economic, regulatory and political trends and features that may impact on the Company's future development and performance.

Valuation Process

Investments held by Maven Income and Growth VCT PLC in unquoted companies are valued in accordance with the International Private Equity and Venture Capital Valuation Guidelines. Investments quoted or traded on a recognised stock exchange, including AIM, are valued at their bid prices.

Share Buy-backs

The Board will seek the necessary Shareholder authority to continue the share buy-back programme under appropriate circumstances.

Employee, Environmental and Human Rights Policy

As a venture capital trust, the Company has no direct employee or environmental responsibilities, nor is it responsible for the emission of greenhouse gases. Its principal responsibility to Shareholders is to ensure that the investment portfolio is properly managed and invested. The Company has no employees and, accordingly, has no requirement to report separately on employment matters. 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, and further information may be found in the Statement of Corporate Governance. 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.

Future Strategy

The Board and Manager intend to maintain the strategic policies set out above for the year ending 28 February

2015 as it is believed that these are in the best interests of Shareholders.

John Pocock

Chairman

6 June 2014

A Statement of Total Recognised Gains and Losses has not been prepared, as all gains and losses are recognised in the Income Statement.

The total column of this statement is the Profit and Loss Account of the Company.

Notes

Accounting Policies - UK Generally Accepted Accounting Practice

(a) Basis of Preparation

The Financial Statements have been prepared under the historical cost convention, modified to include the revaluation of investments, and in accordance with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' (the SORP) issued in January 2009.

The disclosures on going concern on page 34 in the Directors' Report form part of these Financial Statements.

(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 which are incidental to the acquisition and disposal of an investment are charged to capital; and

· 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 has been allocated 20% to revenue and 80% to realised capital reserves to reflect the Company's investment policy and prospective income and capital growth.

(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 which 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 International Private Equity and Venture Capital Valuation Guidelines (IPEVCV) 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 and loss. At subsequent reporting dates, investments are valued at fair value, which represents the Directors' view of the amount for which an asset could be exchanged between knowledgeable and 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 investments completed within the 12 months prior to the reporting date and those at an early stage in their development, fair value is determined using the Price of Recent Investment Method, except that adjustments are made when there has been a material change in the trading circumstances of the company or a substantial movement in the relevant sector of the stock market.

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 fully taxed prospective 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. Where there is evidence of impairment, a provision may be taken against the previous valuation of the investment.

5. 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.

6. All unlisted investments are valued individually by the portfolio management team of Maven Capital Partners UK LLP. The resultant valuations are subject to detailed scrutiny and approval by the Directors of the Company.

7. In accordance with normal market practice, investments listed on the Alternative Investment Market 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 - quoted prices in active markets for identical investments;

· Level 2 - other significant observable inputs (included quoted prices for similar investments, interest rates, credit risk etc); and

· Level 3 - significant unobservable inputs (including the Company's own assumptions in determining the fair value of investments).

(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.

Movement in Reserves

Earnings per Share

The returns per share are based on the following figures:

Net Asset Value per Ordinary Share

Net asset value per Ordinary Share as at 28 February 2014 has been calculated using the number of Ordinary Shares in issue at that date of 45,823,754 (2013: 40,739,329).

Basis of Preparation of the Financial Statements

This Financial Statements included in this Announcement have been prepared on the same basis as the Annual Report and Financial Statements for the year ended 28 February 2013. The Annual Report and Financial Statements for the year ended 28 February 2014 will be filed with the Registrar of Companies and issued to Shareholders 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 28 February 2013 have been delivered to the Registrar of Companies and contained an audit report which was unqualified and did not constitute statements under S498(2) or S498(3) of the Companies Act 2006.

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 28 February 2014 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 risks and uncertainties that it faces; and

· the Annual Report and Financial Statements taken as a whole are fair, balanced and understandable and provide the information necessary to assess the Company's performance, business model and strategy.

Other Information

The Annual General Meeting will be held on 10 July 2014, commencing at 12.00 noon at Kintyre House, 205 West George Street, Glasgow G2 2LW.

Copies of this announcement, and of the Annual Report and Financial Statements for the year ended 28 February 2014, will be available to the public at the office of Maven Capital Partners UK LLP, 205 West George Street, Glasgow G2 2LW; at the registered office of the Company, Fifth Floor, 1-2 Royal Exchange Buildings, London EC3V 3LF and on the Company's website at www.mavencp.com/migvct.

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 and the Circular have been submitted to the National Storage Mechanism will be available for inspection at: www.Hemscott.com/nsm.do.

By Order of the Board

Maven Capital Partners UK LLP

Secretary

6 June 2014