Maven Income and Growth VCT 2 Regulatory News (MIG2)

4 Apr 2006 15:13

Aberdeen Growth VCT1 PLC04 April 2006 Aberdeen Growth VCT I PLC The Directors announce the unaudited preliminary results for the year ended 31January 2006, which were approved by the Board on 4 April 2006. • Net Asset Value of 73.9p per share, before payment of proposed dividends. • Proposed final revenue dividend of 1.20p per Ordinary share. • Proposed first capital dividend of 2.00p per Ordinary share, subject to the revoking of investment company status. Performance The Net Asset Value (NAV) per share at 31 January 2006, before payment ofdividends in respect of the year then ended, was 73.9p compared with 74.2p at 31July 2005 and 73.6p at 31 January 2005. The increase in NAV over the year of0.4% compares with the increase in stock market indices generally and, inparticular, the FTSE SmallCap index, which rose by 18.4% over the period, andthe FTSE AIM Index which rose by 5.9%. As reported in the Annual Report for lastyear, the principal fund manager changed in September 2004. Since 31 July 2004,the date closest to that change when an NAV was published, the total return hasincreased by 16.7%. The most important performance measures for a VCT are the long-term record ofincome and capital dividend payments and the timing of these payments over thelife of the Company. In the short term, the NAV on its own is a less importantmeasure of performance as the underlying investments are long-term in nature andnot readily realisable. Dividends The Board did not declare an interim dividend but recommends the payment of afinal dividend of 1.20p per share, to be paid on 23 June 2006 to Shareholders onthe register at close of business on 26 May 2006. In addition, the Directorsintend that the Company should revoke Investment Company status, which willfacilitate the future payment of capital dividends, whilst retaining forShareholders all the benefits of VCT status. The Board also intends that theCompany will pay a capital dividend of 2.00p per share from the realised gainsmade on investments to date, representing the first such distribution made bythe Company and this compares favourably to the total revenue dividends paid todate of 2.22p. The capital dividend will be paid in the second quarter of 2006,subject to the revoking of Investment Company status, and reflects the gains onthe sale of investments which have been achieved to date. The Board hopes toestablish a progressive dividend policy, but this will depend on a continuationof the success during the past year of generating realised gains frominvestments. Since the Company's launch, and including the proposed distributions mentionedabove, Shareholders will have received 5.42p per share in tax free dividends;the total return since launch will be 76.12p, being the sum of dividends paidplus current NAV. The effect of paying the proposed dividends, totalling 3.2p, will be to reducethe NAV by a similar amount. Investment strategy In the short-term, the prime objective is to build a diversified portfolio ofunlisted and AIM quoted investments which offer excellent growth prospects and,therefore, the opportunity for capital gains in the medium and longer term whilemaintaining VCT qualifying status. Investment activity During the year ended 31 January 2006, sixteen new unlisted and AIM investmentswere completed and a total of £6.7 million was invested. At the year end, theportfolio stood at 47 active unlisted and AIM investments at a total cost of£15.1 million. The following new investments have been completed since the publication of theInterim Report:- Amazing Holdings* (December 2005) - £250,000: Amazing is a leisure facility andhotel developer which intends to operate a casino in the Penghu Islands ofTaiwan. (www.amazing.co.im) Bond Aviation Solutions (November 2005) - £500,000: Bond provides commercialpilot training services from its Gatwick base. (www.flyastraeus.com) Chiltern (UK) (November 2005) - £275,000: Chiltern negotiates and managesstandstill agreements and repayment plans for financially distressed individualswho cannot service their debts. (www.chiltern.uk.com) Fieldstreet (Investments) (October 2005) - £501,000: Fieldstreet is the name ofthe vehicle which acquired Cox Insurance in a public to private transaction. Coxis a mid-sized insurance business focused on predominately niche risk areaswithin motor insurance. (www.cox.co.uk) Imprint* (September 2005) - £202,000: Imprint provides a search, selection andvalue added human capital management service of the highest professionalstandards within the critical hire, middle and senior management recruitmentmarkets. (www.imprintplc.com) Litcomp (October 2005) - £250,000: Litcomp is a national supplier of medicalreports in support of legal actions. Litcomp shares are traded on OFEX.(www.litcomp-plc.com) Styles & Wood Holdings (December 2005) - £300,000: Styles & Wood is the leadingindependent provider of store fit-out and refurbishment programmes to the UKretail sector. (www.stylesandwood.co.uk) United Clearing* (August 2005) - £287,000: United Clearing is a support servicescompany which provides software based solutions to mobile communicationsoperators, including a financial clearing service for international roamingtraffic. (www.unitedclearing.com) * Quoted on AIM Co-investment Aberdeen Growth VCT I has co-invested with Aberdeen Development Capital,Aberdeen Growth Opportunities VCT, Aberdeen Growth Opportunities VCT 2, TalismanFirst Venture Capital Trust and Murray VCT 4 in some or all of the abovetransactions and is expected to continue to do so, with these as well as otherclients of the Manager. The advantage of this is that, together, the funds areable to underwrite a wider range and size of transaction than would be the caseon a stand-alone basis. Portfolio developments During the year ended 31 January 2006, considerable progress was made, followingthe change of principal fund manager referred to in last year's Annual Report,by adopting a more active trading approach of the AIM portfolio and gains ofmore than £1 million were generated over the course of the year. Two previously unlisted investments have achieved AIM flotations during the yearand each was trading at a level above their cost of investment at the reportingperiod end. In a number of cases, holdings which had been held for some time andhad not performed were divested at prices below their cost. Progress has also been made in the unlisted portfolio, but the Manager believesthat it will be some time before the improvement leads to realised gains fromthese investments. In the Interim Report, reference was made to the increasingmaturity of a number of the private equity investments and this has resulted inone complete and one partial exit, in both cases producing a gain on sale. Acomplete sale has been achieved from the investment in ScotNursing, resulting ina gain of £73,000 on the £315,000 invested. A partial exit has been achievedfrom Enterprise Food Group, resulting in a modest gain on the investment whilstretaining equity holdings in two profitable businesses. The terms of the saleprovide for further deferred consideration to be payable, dependent upon theactual level of profitability achieved by the businesses which were sold, andfrom the eventual sale of the two remaining companies which were spun out of theoriginal company. In addition to these two positive developments, the portfoliogenerally has matured and further gains are likely in due course. Additionally,the holding in Elam T was sold to a successor company in which the Company hasretained an equity interest, although a small loss of £29,000 has been sustainedon the transaction, and the holdings in Room 2 have been realised for a mixtureof ordinary shares and loan stock in Strategic Retail, an AIM quoted company,with a similar value to the cost of the original investment. Investments in theunlisted portfolio are generally trading well but, if there is anyunderperformance, particular attention is paid to those companies by the Managerto effect an improvement and protect the value of the investment. Details of major gains and losses arising from the sale of investments duringthe year are shown in the table below: Date first Complete/ Cost of shares Sales Realised gain/ invested partial exit disposed of proceeds (loss) £'000 £'000 £'000UnlistedElam-T 2003 Partial 379 350 (29)Enterprise Food Group 2003 Partial 285 301 16ScotNursing 2002 Complete 315 388 73Others Partial 466 466 -Total unlisted 1,445 1,505 60 AIMAvanti Screenmedia 2004 Partial 112 223 111Begbies Traynor 2004 Complete 251 579 328Blooms of Bressingham 2001 Complete 100 58 (42)Cardpoint 2002 Complete 427 1,134 707Corac 2001 Complete 158 49 (109)Corpora 2004 Complete 250 85 (165)Glisten 2002 Complete 182 674 492Hartford 2002 Complete 222 111 (111)Imagesound 2004 Complete 137 54 (83)Intelligent Environments 2002 Complete 175 112 (63)Lloyds British Testing Group 2002 Complete 200 78 (122)Talarius 2005 Partial 161 206 45Tanfield 2004 Partial 66 116 50Tikit 2001 Complete 253 411 158UBC Media Group 2002 Complete 206 176 (30)Others Partial 241 249 8Total AIM 3,141 4,315 1,174 Total 4,586 5,820 1,234 Aberdeen Growth VCT I is continuing to invest in a diversified portfolio ofunlisted and AIM quoted investments with good growth prospects and, therefore,the opportunity to generate capital gains in the medium and longer term. Valuation process Investments held by Aberdeen Growth VCT I in unquoted companies are valued inaccordance with the International Private Equity and Venture Capital ValuationGuidelines, which superseded the British Venture Capital Association Guidelinesfor reporting periods beginning after 1 January 2005. Investments which are quoted or traded on the Alternative Investment Market(AIM) or a recognised stock exchange are valued at their bid price. Share buy-back policy Purchases of the Company's shares will be made within guidelines establishedfrom time to time by the Board, at prices below the prevailing NAV per Ordinaryshare and in accordance with the rules of the UK Listing Authority. Sharepurchases will be funded from distributable reserves and, to the extent thatshares are purchased at a discount, the NAV of the remaining shares willincrease. During the year 1,002,740 shares were bought back for cancellation atan average price of 50.13p and an aggregate cost, including expenses, of£505,215. Constitution of the Board On 1 November 2006, the Board announced the appointment of Bill Nixon asAlternate Director for Martin Gilbert. Mr Gilbert is Chief Executive of AberdeenAsset Management PLC, and Mr Nixon is the Head of the Growth Capital team withinthe Private Equity Division of Aberdeen Asset Managers Limited. Co-investment Scheme of the Manager A co-investment scheme, which will allow executive members of the Manager toinvest alongside the Company, has been agreed with the Manager forimplementation during the coming year. This incentive scheme will replace theexisting performance fee arrangement and, the Directors believe, will align theinterests of the executives and the Shareholders of the Company much moreclosely. The scheme will operate through a nominee company which will invest alongsidethe Company in each and every transaction made by the Company, including anyfollow-on investments. In an unlisted investment, the transaction will normallybe structured such that 70% to 90% of the investment is by way of fixed interestinstrument and 10% to 30% in ordinary shares. The amount which will be investedby the nominee company is fixed at 5% of the value of the ordinary shares whichare available to the Company, except where the Company is investing only inordinary shares. In that case, the amount to be invested by the nominee companywill be 1.5% of the amount available to the Company. The impact of the scheme in terms of dilution will be small, but the Scheme willmore closely align the interests of the executives and the Company'sShareholders, while introducing an incentive to enable the Manager to retain theexisting skills and capacity of its management team in a highly competitivemarket. Outlook It is the Board's intention to adopt a policy of paying regular dividends infuture based on the gains arising from realisations within the portfolio. Aswith all dividends paid by VCTs, these dividends will be paid free of tax toShareholders. The Board would also like to see the level of dividend paymentsincrease over the course of time. The Board looks forward to the increasing maturity of the portfolio, which itexpects to result in an increasing number of profitable realisations. Theoutlook for new investments remains positive with a steady flow of both unlistedand AIM quoted opportunities available for consideration by the Manager. Theprimary focus remains on building a properly diversified portfolio of goodquality smaller company assets which will deliver sustained long termperformance. The intensive work on repositioning the investment portfolio willcontinue throughout 2006 and beyond. ABERDEEN GROWTH VCT I PLCINCOME STATEMENTFor the year ended 31 January 2006 Year ended Year ended 31 January 2006 31 January 2005 (audited) (unaudited) (restated) Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 Gains on investments - 74 74 - 1,706 1,706 Income from investments 579 - 579 414 - 414Other income 20 - 20 15 - 15Investment management fees (48) (437) (485) (46) (411) (457)Other expenses (219) - (219) (218) - (218)Net (loss)/return on ordinary activities 332 (363) (31) 165 1,295 1,460before tax Tax on ordinary activities (66) 66 - (25) 25 -(Loss)/return attributable to equity 266 (297) (31) 140 1,320 1,460Shareholders Return per Ordinary share (pence) 1.14 (1.27) (0.13) 0.58 5.41 5.99 * The total column of this statement is the Profit and Loss Account of theCompany. A Statement of Total Recognised Gains and Losses has not been prepared as allgains and losses are recognised in the Income Statement. ABERDEEN GROWTH VCT I PLCRECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDSFor the year ended 31 January 2006 Year ended Year ended 31 January 2006 31 January 2005 (unaudited) (audited) (restated) £'000 £'000 Opening Shareholders' funds 17,616 16,558 (Loss)/return attributable to equity Shareholders (31) 1,460Repurchase and cancellation of shares (505) (262)Dividends paid (137) (140)Closing Shareholders' funds 16,943 17,616 ABERDEEN GROWTH VCT I PLCBALANCE SHEETAs at 31 January 2006 31 January 2006 31 January 2005 (unaudited) (audited) (restated) £'000 £'000 £'000 £'000Fixed assetsInvestments 15,754 16,167 Current assetsDebtors 1,076 571Debtors due after one year - 910Cash and overnight deposits 302 66 1,378 1,547 CreditorsAmounts falling due within one year 189 98Net current assets 1,189 1,449 Net assets 16,943 17,616 Capital and reservesCalled up share capital 2,293 2,393Share premium account 10,535 10,535Capital reserve - realised (4,427) (5,454)Capital reserve - unrealised (1,440) (116)Distributable reserve 9,541 10,046Capital redemption reserve 167 67Revenue reserve 274 145Equity Shareholders' funds 16,943 17,616 Net Asset Value per Ordinary share (pence) 73.9 73.6 ABERDEEN GROWTH VCT I PLCCASH FLOW STATEMENTFor the year ended 31 January 2006 Year ended Year ended 31 January 2006 31 January 2005 (unaudited) (audited) £'000 £'000 £'000 £'000Operating activitiesInvestment income received 531 292Deposit interest received 19 15Other income - 84Investment management fees paid (383) (542)Secretarial fees paid (65) (64)Directors' expenses paid (72) (65)Other cash payments (58) (98)Net cash outflow from operating activities (28) (378) Financial investmentPurchase of investments (6,970) (5,939)Proceeds on Aberdeen Progressive Growth Unit 188 -Trust Uplift PlanSale of investments 7,720 2,834Net cash inflow/(outflow) from financial 938 (3,105)investment Equity dividends paid (137) (140) Net cash inflow/(outflow) before use of liquid 773 (3,623)resources and financing FinancingShare repurchases (537) (230)Net cash outflow from financing (537) (230) Increase/(decrease) in cash 236 (3,853) Aberdeen Growth VCT I PLC Basis of restatement During the year ended 31 January 2006, the Company became subject to newFinancial Reporting Standards issued as part of the programme to converge UKGenerally Accepted Accounting Practice (UK GAAP) with International AccountingStandards. As a consequence of this, the results for the year ended 31 January2005 have been restated to reflect the changes of accounting practice inrelation to the following: • investments are measured initially at cost and are recognised at trade date; and • for financial assets acquired, the cost is the fair value of the consideration. Subsequent to initial recognition, investments are valued at fair value. For listed and AIM quoted investments, this is deemed to be bid market prices sourced from The London Stock Exchange. Unlisted investments are valued by the Directors at fair value, in line with the International Private Equity and Venture Capital Valuation Guidelines, which superseded the British Venture Capital Association Valuation Guidelines for reporting periods beginning on or after 1 January 2005. In accordance with FRS 21 - Events after the Balance Sheet Date, dividends arenot accrued in the Financial Statements unless they have been declared beforethe Balance Sheet Date. Final dividends are therefore recognised in the periodin which they are declared and paid. As a result of this change, the FinancialStatements for the year ended 31 January 2005 have been restated. The impact of these changes is shown as follows: Reconciliation of Balance Sheets As previously reported As restatedReconciliation of Balance Sheet 31 January 2004 Effect of change 31 January 2004at 31 January 2004 (audited) in policy (audited) £'000 £'000 £'000Fixed assetsInvestments 13,100 (391) 12,709 Current assetsDebtors 241 - 241Cash and overnight deposits 3,919 - 3,919 4,160 - 4,160 CreditorsAmounts falling due within one year 451 (140) 311Net current assets 3,709 140 3,849 Net assets 16,809 (251) 16,558 Capital and reservesCalled up share capital 2,451 - 2,451Share premium account 10,535 - 10,535Capital reserve - realised (5,087) - (5,087)Capital reserve - unrealised (1,412) (391) (1,803)Distributable reserve 10,308 - 10,308Capital redemption reserve 9 - 9Revenue reserve 5 140 145Equity Shareholders' funds 16,809 (251) 16,558 Net Asset Value per Ordinary share 68.6 67.6(pence) As previously reported As restatedReconciliation of Balance Sheet 31 January 2005 Effect of change 31 January 2005at 31 January 2005 (audited) in policy (audited) £'000 £'000 £'000Fixed assetsInvestments 16,399 (232) 16,167 Current assetsDebtors 1,481 - 1,481Cash and overnight deposits 66 - 66 1,547 - 1,547 CreditorsAmounts falling due within one year 235 (137) 98Net current assets 1,312 137 1,449 Net assets 17,711 (95) 17,616 Capital and reservesCalled up share capital 2,393 - 2,393Share premium account 10,535 - 10,535Capital reserve - realised (5,454) - (5,454)Capital reserve - unrealised 116 (232) (116)Distributable reserve 10,046 - 10,046Capital redemption reserve 67 - 67Revenue reserve 8 137 145 Equity Shareholders' funds 17,711 (95) 17,616 Net Asset Value per Ordinary share 74.0 73.6(pence) Reconciliation of the Statement of Total Return to the Income Statement Year ended 31 January 2005 (audited) £'000 Total transfer to reserve per originally reported Statement 1,164of Total ReturnAdd year to 31 January 2005 final dividend on Ordinary shares 137Change from mid to bid basis at 31 January 2004 391Change from mid to bid basis at 31 January 2005 (232)Return on ordinary activities after tax per Income Statement 1,460 Except for the changes referred to above, this Preliminary Announcement has beenprepared on the same basis as the Annual Report and Financial Statements for theyear ended 31 January 2005. Other information In respect of the year ended 31 January 2006, returns per Ordinary share havebeen calculated using the average number of shares in issue during the year of23,413,707. Net Asset Value per Ordinary share as at 31 January 2006 has beencalculated using the number of shares in issue at that date of 22,928,195. A summary of investment changes for the year ended 31 January 2006 and aninvestment portfolio summary as at 31 January 2006 are attached. The results for the year ended 31 January 2006, which are subject to finalaudit, will be filed with the Registrar of Companies and a full copy of theAnnual Report and Financial Statements will be issued to Shareholders in duecourse. The financial information contained within this Preliminary Announcement doesnot constitute the Company's statutory Financial Statements as defined inSection 240 of the Companies Act 1985. The statutory Financial Statements forthe year ended 31 January 2005 have been delivered to the Registrar of Companiesand contained an audit report which was unqualified and did not constitutestatements under Sections 237(2) or (3) of the Companies Act 1985. The Annual General Meeting will be held on 14 June 2006, commencing at 10.30a.m. Copies of this announcement will be available to the public at the office ofAberdeen Asset Managers Limited, 123 St Vincent Street, Glasgow and at theregistered office of the Company, One Bow Churchyard, Cheapside, London. By Order of the Board ABERDEEN ASSET MANAGEMENT PLCSECRETARIES 4 April 2006 ABERDEEN GROWTH VCT I PLCSUMMARY OF INVESTMENT CHANGESFor the year ended 31 January 2006 Valuation 31 January 2005 Net investment/ Appreciation/ Valuation (restated) (disinvestment) (depreciation) 31 January 2006 £'000 % £'000 £'000 £'000 %Unlisted investmentsEquities 2,596 14.7 627 (429) 2,794 16.5Fixed income 4,376 24.9 1,862 (22) 6,216 36.7 6,972 39.6 2,489 (451) 9,010 53.2 AIM investmentsEquities 5,989 34.0 (1,649) 445 4,785 28.2 UK authorised unit 1,948 11.1 (310) 321 1,959 11.6trusts Listed investmentsFixed income 1,258 7.1 (1,259) 1 - - Total investments 16,167 91.8 (729) 316 15,754 93.0 Other net assets 1,449 8.2 (18) (242) 1,189 7.0 Net assets* 17,616 100.0 (747) 74 16,943 100.0 *Net assets represents Equity Shareholders' funds. ABERDEEN GROWTH VCT I PLCINVESTMENT PORTFOLIO SUMMARY As at 31 January 2006 % of Valuation total Nature of business £'000 assetsUnlisted investmentsAlbanet Provider of network services 408 2.4AMGas Manufacturer of gas sensors for application in oil and gas exploration 483 2.9Bond Aviation Solutions Provision of pilot training services 500 2.9Businesshealth Group Provider of health management services - -Cash Bases Design and manufacture of customised cash drawers 500 2.9Chiltern (UK) Debt management 275 1.6Citel Technologies Integrated solutions for the telephony and communications sector 461 2.7Driver Hire Supplier of temporary drivers 107 0.6Elam-T 2 Developer of flat screen technologies 350 2.1Enterprise Food Group Supply chain management services for catering business Holdings 31 0.2Enterprise Food Group Supply chain management services for catering business - -Essential Viewing Systems Software developer 400 2.4Fieldstreet (Investments) Insurance business focused on predominately niche risk areas within motor insurance 501 3.0GW 1016 Operator of managed public houses 143 0.9Inovas Software developer 231 1.4IS Holdings Provider of biometric software solutions - -Kingsley Cards Design and production of greeting cards 500 2.9Litcomp National supplier of medical reports in support of legal actions 250 1.5Llanllyr Water Company Extraction and bottling of mineral spring water 500 2.9Mercury Inns Group Operator of freehold food-led pubs and consultancy services - -Mining Communications Publisher of specialist trade journals 340 2.0Original Shoe Company Branded clothing and footwear retailer 500 2.9Palgrave Brown (Holdings) Manufacturer of timber products 298 1.8Patisserie UK (Holdings) Bakery 14 0.1PLM Dollar Group On-shore helicopter services 119 0.7PSCA International Producer of publications aimed at public sector officials 517 3.1RMS Europe Provider of stevedoring and ships agency services 278 1.6Styles & Wood Holdings Leading independent provider of store fit-out and refurbishment 300 1.8 programmes to the UK retail sector Transrent Holdings Rental and sale of trailers 524 3.1Travel Class Activity-based educational holidays for schoolchildren 480 2.8Tuscan Energy Group Oil production - - 9,010 53.2 AIM investmentsAmazing Holdings Leisure and hotel developer 254 1.5Asfare Manufacture and supply of equipment for the emergency services 39 0.2Avanti Screenmedia Provider of screens and media advertising 400 2.4Award International Sourcing and delivery of merchandising materials 26 0.2HoldingsAxeon Developer of semi conductor intellectual properties 755 4.4Cello Group Group of companies in the marketing and media services industry 146 0.9Dipford Group Specialist corporate finance boutique 295 1.7Elevation Events Group Provider of management events and corporate hospitality 103 0.6Fountains Land management services 130 0.8Imagesound Provider of background message services 37 0.2Imprint Multi-disciplinary recruitment business 200 1.2Legend Communications Internet service provider 73 0.4Leisure & Gaming Provider of on-line gaming services 171 1.0Public Recruitment Group Suppliers of doctors and teachers to the state sector 52 0.3Software Radio Technology Provider of wireless technology products and services 665 3.9Spectrum Interactive Provider of payphones and internet access throughout the UK 71 0.4Strategic Retail Retailer of home furnishings 304 1.8System C Healthcare Information services and IT systems to the healthcare sector in 112 0.7 England Talarius High street gaming 304 1.8Tanfield Group Technical solutions and manufacturing group 363 2.1United Clearing Provider of software based solutions to mobile communications 285 1.7 operators 4,785 28.2 Unit trustsAberdeen Progressive Growth Fund 1,959 11.6 1,959 11.6 Total investments 15,754 93.0 This information is provided by RNS The company news service from the London Stock Exchange