Maven Income 1 Regulatory News (MIG1)

Maven Income and Growth VCT PLC

Interim results for the six months ended 31 August 2013 (unaudited)

The Directors are pleased to announce the unaudited Interim Management Report for the six months ended 31 August 2013.

Overview

The continuing focus for your Company is to achieve long-term capital appreciation and to generate maintainable levels of tax-free income for Shareholders through the ongoing expansion of the private equity asset base.

During the six month period to 31 August 2013 NAV total return increased further to 120.60p per share and net assets at the period end, including the proceeds of the successful Offer for Subscription which closed on 11 February 2013, were £28.7 million. The portfolio now includes 45 later-stage private company investments, the majority of which are trading positively and paying a yield. The portfolio continues to generate strong levels of revenue, which is an important component in your Company's ability to sustain an attractive level of tax-free distributions to Shareholders. Consequently, your Board is pleased to declare an increased interim dividend of 2.20p per share.

The Maven team has continued to seek out suitable investment opportunities in profitable UK companies with established revenue streams and, during the period, several significant new assets were added to the portfolio. In March 2013 a new company was formed to acquire DPP, a proven mechanical and electrical maintenance business; and in June 2013 two new investments completed with the acquisition of HCS Control Systems Group and the buy-out of Lambert Contracts Holdings. Additionally Maven has incorporated three new companies to invest in the retail, engineering and e-commerce sectors.

The trend of successful exits seen during the previous financial year has continued, and three profitable realisations were achieved during the period generating capital proceeds of £2.8 million.

We are pleased to note a number of awards in recognition of the quality of the Company's unlisted portfolio and Maven's investment management strategy. In April 2013 our investee company, Torridon, was announced as the Midlands regional winner of the Mid-Market Private Equity-Backed Management Team of the Year award at the BVCA Management Team Awards. In the following month Maven was announced as Scottish Investor of the Year at the Acquisition International M&A Awards, which recognise consistent achievement in the private equity transactional marketplace.

More recently, in September 2013, Maven enjoyed a double success at the Scottish Insider Deal and Dealmakers Awards, with the exit from Nessco Group Holdings winning Sale of the Year and Managing Partner Bill Nixon being named as Dealmaker of the Year in a category focused on individuals with a first class track record in completing or enabling transactions. Finally, and most notably, the Company was voted VCT of the Year at the Investor Allstars Awards, which celebrate achievement in investments, exits and entrepreneurship.

Highlights

• Total return of 120.60p per share at 31 August 2013, up from 120.20p at 28 February 2013;

• NAV at period end of 67.50p per share after payment of the final dividend of 3.50p;

• Realisation of Atlantic Foods Group for a total return of 1.8x cost;

• Six new investments added to the portfolio during the period;

• Partial exit from Homelux Nenplas alongside a secondary buy-out of the Nenplas business;

• Successful IPO of esure; and

• Interim dividend declared of 2.20p per share (2012: 2.00p).

The most important measure of performance for a VCT is the NAV total return, which is the long term record of dividend payments out of income and capital gains combined with the current NAV.

Dividends

The Board has declared an interim dividend of 2.20p per share, comprising 1.00p of revenue and 1.20p of capital, to be paid on 6 December 2013 to Shareholders on the register on 8 November 2013. Since the Company's launch, and after receipt of the interim dividend, Shareholders who invested at the outset will have received 55.30p per share in tax-free dividends.

The Board regards the growing level of dividends as an indication of the success of the Company's investment strategy and is committed to improving Shareholder distributions in future years as the portfolio continues to expand and mature.

Investment activity

During the period the Maven team completed six new private equity investments on behalf of your Company, alongside five follow-on investments in existing portfolio companies. At the period end, the portfolio stood at 57 unlisted and AIM/ISDX quoted investments at a total cost of £26.3 million.

The following investments have been completed during the period:

Your Company has co-invested in some or all of the above transactions with Maven Income and Growth VCT 2, Maven Income and Growth VCT 3, Maven Income and Growth VCT 4, Maven Income and Growth VCT 5 and Maven Income and Growth VCT 6 (formerly Talisman First Venture Capital Trust). The Company is expected to continue to co-invest with all other Maven VCT clients, which offers the advantage that, in aggregate, they are able to underwrite a wider range and larger size of transaction than would be the case on a stand-alone basis.

New investments

Six private company investments were added to the portfolio during the period under review:

• Ensco 969, a new company formed to acquire DPP, a business that provides planned and reactive mechanical and electrical maintenance services to operators of pubs, restaurants and retail chains, predominantly in the South of England. DPP has significant levels of contractual and recurring revenues and a track record of attracting new clients and increasing both the breadth of service and geography within which it is delivered;

• HCS Control Systems Group, a long established business that designs, manufactures, assembles and tests instrumentation control packages for the onshore and worldwide offshore oil & gas industry. HCS enjoys a large degree of repeat business from a loyal customer base and will focus on growth through internationalisation into key overseas markets. This acquisition was made by Burray Capital, a new company established by Maven in December 2012 to invest in the oil & gas sector;

• Lambert Contracts Holdings, a leading specialist contractor in insurance reinstatement, property maintenance and fire protection, which benefits from long term embedded relationships with major insurance companies, loss adjustors and property managers;

• Manor Retailing, a new company set up to invest in the retail and leisure sector, where Maven has made a number of successful investments and sees the potential for further opportunities;

• Richfield Engineering Services, a new company established with a buy & build strategy targeting engineering businesses with a proven technical service or product that encompasses manufacturing, maintenance and spares & service capabilities; and

• Search Commerce, a new company set up to invest in a business providing e-commerce platforms focusing on distribution, service and retail businesses.

In June 2013, a follow-on investment was made into Glacier Energy Services Group, an oil & gas service group headquartered in Aberdeen with two operating divisions, Glacier Engineering and Glacier Offshore. The engineering division is a specialist provider of weld overlay and cladding services through the Wellclad trading company. The offshore business sells on-site machining services via two trading companies, Roberts Pipeline Machining and Site Machining Services. The group is focused on growth within its core UK market and this investment funded the acquisition of a business that provides heat exchanger repair and refurbishment

services for the offshore oil & gas industry.

A commitment has also been made to provide a fully secured mezzanine loan to Maven Capital (Llandudno) to fund the refurbishment of a hotel in North Wales with a long lease in place. The transaction will provide an 8.65% running yield following completion of the development.

Realisations

In March 2013, Maven led the successful partial exit from Homelux Nenplas via the sale of the Homelux division to US firm QEP Company Inc. The disposal of Homelux was completed alongside a secondary buy-out of Nenplas by Maven and the existing management team. The remaining business, Nenplas Holdings, will focus on continuing to deliver innovative extruded plastic products and solutions and is expected to grow significantly over the next few years through organic opportunities and by making new acquisitions. Additional funding was provided to Nenplas in May 2013 to support the purchase of a plastic extrusion business based in Worcestershire.

Also in March 2013, esure undertook a successful IPO, and a realisation at the carrying value was crystallised in May, with the majority of exit proceeds being received in cash alongside a small element of stock that will be subject to the normal price fluctuations associated with fully listed holdings.

There was one notable private company full exit during the period with the sale of Atlantic Foods Group to the US based Flagship Food Group which completed in May 2013 for a 1.8 times return on cost.

The Manager is currently engaged with an number of investee companies and prospective acquirers at various stages of a potential exit process. This reflects the increasing maturity of a number of holdings, but it should be noted that there can be no certainty that these discussions will lead to profitable sales.

In respect of the AIM/ISDX portfolio the Manager has continued its policy of disposing of quoted holdings for best possible value in cases where the investments were underperforming.

The table below gives details of all realisations during the reporting period:

1Proceeds exclude yield and redemption premiums received, which are disclosed as revenue for financial reporting purposes.

One unlisted investment and one AIM company were struck off the Register during the period resulting in realised losses of £280,000 (cost £280,000). This had no effect on the NAV as full provisions had been made against the value of each holding in earlier periods.

Other material developments

Following a serious fire at the Lawrence Recycling & Waste Management plant in June 2013, which has adversely impacted upon the company's trading prospects, the investment has been written down pending further developments. The reduced value is reflected in the statement of NAV at 31 August 2013.

Since 31 August 2013 investments totalling £360,000 have been completed to support and provide additional funding for business expansion to three existing investee companies.

Principal risks and uncertainties

The Board has reviewed the principal risks and uncertainties facing the Company, which were set out in full in the 2013 Annual Report, and are the risks involved in investment in small and unquoted companies. In order to reduce the exposure to investment risk the Company has invested in a broadly-based portfolio of mature companies in the United Kingdom.

The VCT qualifying status of the Company is reviewed regularly by your Board and monitored on a continuous basis by the Manager in order to ensure that all of the criteria for VCT qualifying status are satisfied. The Board is pleased to confirm that all tests continue to be met.

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.

VCT regulation

The AIC worked closely with the 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, in the same way that investment trusts had been, and was pleased to note the announcement by the FCA (which replaced the FSA) that VCTs have been excluded from the marketing restrictions.

The AIC has also 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 schemes conflict with the public policy objectives of venture capital trusts. The principles underpinning the AIC's response to the consultation are that any legislative response should: deliver the policy ambitions of VCTs by ensuring that genuine new funds are raised for investment in SMEs in a way that provides value for money to the taxpayer; be proportionate and not introduce unnecessary complexity; and support the commercial flexibility and investment proposition of VCTs, particularly by allowing traditional on-market share buy-backs to continue.

The Manager monitors all potential regulatory changes that are under consideration and keeps the Board informed of any implications for the Company.

VCT Offers and fund raising

An Offer for Subscription was made in January 2013, aiming to raise £1.5 million before expenses, in parallel with Maven Income and Growth VCT 2 and Maven Income and Growth VCT 3, each also aiming to raise £1.5 million, and Maven Income and Growth VCT 5, aiming to raise £1 million. The Offer was fully subscribed by 11 February 2013 and consequently closed early, resulting in the issue of 2,128,396 Ordinary Shares at an issue price of 70.47p, raising an additional £1.5 million of share capital, before expenses.

On 25 September 2013, the Company announced that it is planning to raise up to £4 million in a joint Offer for Subscription alongside Maven Income and Growth VCT 2, Maven Income and Growth VCT 3 and Maven Income and Growth VCT 4, each also aiming to raise up to £4 million; Maven Income and Growth VCT 5 aiming to raise up to £3 million; and Maven Income and Growth VCT 6 aiming to raise up to £1 million. It is anticipated that the Offer will remain open until 5 April 2014 in respect of the 2013/14 tax year and until late April 2014 in respect of the 2014/15 tax year, unless fully subscribed at an earlier date and subject to the Directors' right to close or extend the Offer at any time. The full terms of the Offer, which will include an over-allotment facility to allow the Company to raise a further £1 million, are 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.

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.

Share buy-back policy

Shareholders have given the Board authority to buy back shares for cancellation when it is in the interests of the Shareholders and the Company as a whole and 350,000 Ordinary Shares were bought back during the period at a cost of £226,000.

As stated in the 2013 Annual Report, 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. 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 of between 5% and 10% to the prevailing NAV per share.

Investment management fees

The Company currently pays Maven a performance related investment management fee equivalent to the higher of 1.4% of net assets as at the end of February in each year or 27.5% of the increase in NAV over defined six-month periods, excluding the impact of distributions and purchases of the Company's Shares and subject to a maximum annual payment of £1.25 million. The Board and the Manager have been in discussions regarding the fee arrangements and it has been agreed, in principle, that the higher calculation rate will reduce from 27.5% to 20% and the minimum fee will increase to 1.9% of net assets, with the overall maximum fee remaining unchanged. It is intended that the revised fee rates will take effect from 1 March 2014 and the Board considers this change to be in the best interests of Shareholders, while retaining an appropriate level of incentive for the Manager.

Outlook

Your Company will continue to focus on investing at prudent entry multiples in later-stage private companies with strong management teams which are capable of paying regular income and offer significant potential for capital growth.

We believe this strategy is the optimal approach to deliver future growth in Shareholder value and to support a progressive dividend programme.

Maven Capital Partners UK LLP

Manager

28 October 2013

A Statement of Total Recognised Gains and Losses has not been prepared, as 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 derives its income from investments made in shares, securities and bank deposits.

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

Maven Income and Growth VCT PLC

Notes to the Financial Statements

1. Accounting policies

The financial information for the six months ended 31 August 2013 and the six months ended 31 August 2012 comprises non-statutory accounts within the meaning of the Companies Act 2006.

The financial information contained in this report has been prepared on the basis of the accounting policies set out in the Annual Report and Financial Statements for the year ended 28 February 2013, which have been filed at Companies House and which contained an Auditor's Report which was not qualified and did not contain a statement under S498(2) or S498(3) of the Companies Act 2006.

2. Movement in reserves

3. Returns per Ordinary Share

The returns per Ordinary Share are based on the following figures:

Directors' responsibility statement

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

· the Financial Statements for the six months ended 31 August 2013 have been prepared in accordance with applicable accounting standards and with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies' issued in January 2009;

· the Interim Management Report includes a fair review of the information required by DTR 4.2.7R in relation to the indication of important events during the first six months, and of the principal risks and uncertainties facing the Company during the second six months, of the year ending 28 February 2014; and

· the Interim Management Report includes adequate disclosure of the information required by DTR 4.2.8R in relation to related party transactions and any changes therein.

Other information

The NAV per Ordinary Share has been calculated using the number of Ordinary Shares in issue at 31 August 2013 of 42,517,725.

A summary of investment changes for the six months under review and an investment portfolio summary as at 31 August 2013 are included above.

A full copy of the Interim Report and Financial Statements will be printed and issued to Shareholders. Copies of this announcement will be available to the public at the office of Maven Capital Partners UK LLP, Kintyre House, 205 West George Street, Glasgow G2 2LW and at the registered office of the Company, 5th Floor, 1-2 Royal Exchange Buildings, London EC3V 3LF.

On behalf of the Board

Maven Capital Partners UK LLP

Secretary

28 October 2013