Mobeus I&g 4 Regulatory News (MIG4)

Mobeus Income & Growth 4 VCT plc, ("MIG4", the "Company", or the "Fund") is a Venture Capital Trust ("VCT") advised by Mobeus Equity Partners LLP ("Mobeus"), investing primarily in established, unquoted companies.

Company Objective

The Objective of the Company is to provide investors with a regular income stream by way of tax-free dividends and to generate capital growth through portfolio realisations which can be distributed by way of additional tax-free dividends, while continuing at all times to qualify as a VCT.

Financial Highlights

Results for the six months ended 30 June 2017

-Net Asset Value ("NAV") Total Return per share of 5.2% for the half-year.

-The Company has declared an interim dividend of 18.00 pence per share, payable on 11 September 2017 to

shareholders on the register on 18 August 2017, bringing total cumulative dividends paid to shareholders since 

inception to 98.20 pence per share.

- Investments totalling £1.651  million have been made into Tapas Revolution, Buster & Punch, MyTutor, and a 

follow on investment into BookingTek.

- The Company has realised its investment in Entanet after the period end in August 2017 for £4.89 million, 

contributing to a 2.5 multiple of cost over the life of the investment to date.

- The Board intends to raise up to £15 million under an Offer (£10 million plus

£5 million via an over-allotment facility) alongside the other Mobeus VCTs, to be launched in September 2017.

1 - includes £0.53 million previously held in a company preparing to trade.

Cumulative total shareholder return per share (NAV basis)*

The net asset value (NAV) per share as at 30 June 2017 was 106.18 pence.

The longer term trend of performance on this measure is shown in the chart below:

*Cumulative NAV total shareholder return is net asset value plus cumulative dividends paid since 1999 to date.

The table above shows the recent past performance of the original funds raised in 1999. The original subscription price was 200 pence per share before the benefit of income tax relief. Subscription prices from subsequent fundraisings and historic performance data from 2008 are shown in the Investor Performance Appendix on the Company's website, www.mig4vct.co.uk, where they can be downloaded by clicking on "table" under "Reviewing the performance of your investment" on the home page.

On 31 July 2006, Mobeus became sole Investment Adviser to the Company. The cumulative NAV total return at this date was 122.51 pence.

Chairman's Statement

I am pleased to present this Half-Year Report for Mobeus Income & Growth 4 VCT plc covering the six months ended 30 June 2017.

Overview

Your Board has announced its intention to raise up to a further £15 million comprising £10 million with a possible further over-allotment facility of £5 million alongside three other Mobeus- advised VCTs before the end of the financial year. This seems sensible to finance the intended investment programme, particularly as it is possible that the rules governing VCT investment may not be as favourable in the future.

We also believe that there continues to be good appetite for further investment in the Company, following a very popular fundraising in the 2014/2015 tax year.

A general meeting was convened and held on 3 August 2017 at which shareholder approval was sought and obtained for authority to allot shares and dis-apply pre-emption rights in connection with the fundraising. The Offers for Subscription ("Offers") are expected to be launched in early September 2017, full details of which will be contained in the Prospectus that will be sent to all registered shareholders.

We very much hope that existing shareholders will add to their holdings and look forward to welcoming new investors in the Company.

The half-year has produced a good return for shareholders with a positive income return and an increase in the value of the portfolio. In particular, the Board is pleased to note the sale of the investment in Entanet just after the half-year end, which has contributed substantially to this good return for shareholders.

The level of new investment has been strong with four growth capital investments completed so far in 2017. Further details of these investments are included under 'Investment Portfolio' below. These investments reflect the revised focus on providing growth capital to younger and smaller companies in accordance with the revised Investment Policy approved by shareholders last year. By way of reminder, this revised Policy was required to comply with the new VCT measures introduced by the Finance (No 2) Act 2015 in November of that year. Since that change £7.12 million has been invested to date in nine such companies.

Although the VCT industry can no longer make investments to finance management buyouts ("MBOs") these MBO investments continue to represent 77% of the Company's portfolio. This portfolio has performed well in what is a time of political and economic uncertainty.

Performance

The Net Asset Value ("NAV") Total Return was 5.2% for the period (compared with 0.1% for the same period last year).

Interim dividend

The Board has declared an interim dividend of 18.00 pence per share, comprising 1.00 pence from income (2016: 1.00 pence) and 17.00 pence from capital (2016: 1.00 pence), of which 15.00 pence is payable from the Company's Special Distributable Reserve. Shareholders should not assume further payments from the Special Distributable Reserve in the foreseeable future. The quantum of dividend payments will increasingly depend on the success or otherwise of the current investment policy implemented as a result of regulatory changes.

The interim dividend will be paid on 11 September 2017 to shareholders on the Register on 18 August 2017 and will bring cumulative dividends paid per share since launch to 98.20 pence.

Investment portfolio

As noted above, the Company completed the divestment of Entanet Holdings Limited after the period end. Proceeds of £4.89 million have been received, while a further £0.50 million of deferred consideration is potentially payable over the next two years. This investment has achieved a return on original investment cost of 2.5 times to date, over the three and a half years that the investment was held, which is a very pleasing. The valuation of Entanet at the half-year reflects the full £4.89 million of cash proceeds received after the period-end.

Overall the performance of the investment portfolio has been pleasing. The portfolio achieved a gain of £2.45 million (6.3% of the opening value during the first half of the year and was valued at £37.93 million at the period-end (30 June 2016: £37.45 million). The six month period experienced notable increases in the valuations of Entanet and Access IS. The portfolio also saw valuation declines over the period for Fullfield (Motorclean), CGI Creative Graphics and Media Business Insight.

During the period three new investments and one follow on were completed at a total cost of £1.65 million (analysed in the Investment Review and explained within Note 10).

These new investments were:

● Ibericos Etc. Limited (trading as Tapas Revolution) - a leading Spanish restaurant chain in the casual dining sector.

● Chatfield Services Limited (trading as Buster & Punch) - a London-based interiors brand.

● MyTutorweb Limited - a digital marketplace that connects school pupils who are seeking private

one-to-one tutoring with university students.

Shortly after the period end, a further new investment of £2.33 million was made into Wetsuit Outlet, a leading online retailer in the water sports market. This investment utilised £1.56 million previously held in a company preparing to trade.

The company received cash proceeds of £4.57 million during the period, including £4.40 million of loan stock repayments.

Further information on the portfolio can be found under the Investment Adviser's Review.

Revenue account

There was an increase in net revenue return for the period, being £0.76 million compared to £0.61 million recorded this time last year. Income has increased due to a strong stream of dividends, as well as improved loan interest receipts due to new investments and some portfolio companies resuming loan interest payments as their trading improved. Running costs have fallen due to lower Investment Adviser fees arising from lower net assets.

Industry and regulatory developments

The Patient Capital Review, announced in November 2016, is now in its consultation phase ahead of the Autumn Budget 2017. Led by HM Treasury, its objective is to assess what amendments to Government policy, if any, are needed to support the expansion in provision of long-term capital for growing innovative firms. The Board is firmly of the view that the government should use this review to make a renewed public commitment to the positive role that VCTs play in providing development capital to the small business sector, as well as affirming the long-term future of the scheme.

Liquidity

The present level of cash or near cash resources held by the Company as at 30 June 2017, including the liquidity held by companies preparing to trade, was £18.25 million or 35% of net assets. After the period end, following the investment in Wetsuit Outlet, the realisation of Entanet Holdings, and the payment of the interim dividend in September 2017, the level of liquidity will be £11.86 million or 27% of net assets.

The VCT continues to hold its cash in a selection of money market funds with AAA credit ratings and in a number of deposit accounts diversified among well-known financial institutions across a range of maturities.

Investment in qualifying holdings

The Company is required to meet the threshold set by HM Revenue & Customs ("HMRC") of investing 70% of the funds raised in qualifying unquoted and AIM quoted companies. The Company complied with this limit (based on VCT cost as defined in tax legislation, which differs from the actual cost given in the Investment Portfolio Summary throughout the period. The balance of the portfolio continues to be held in non-qualifying investments and cash.

Share buybacks

We are pleased to note that currently there is relatively little demand for share buybacks. There were no share buybacks during the six months ended 30 June 2017. 10,000 Ordinary shares were bought back following the period end at a price of 90.86 pence per share (including costs). These were bought back at approximately a 10% discount to the Company's latest announced NAV, in accordance with its Buyback policy.

All of the shares bought-back after the period-end were subsequently cancelled by the Company. Continuing shareholders benefit from the difference between NAV per share and the price per share at which the shares are bought back and cancelled.

Dividend Investment Scheme

The Company's Dividend Investment Scheme ("the Scheme") is a convenient, easy and cost effective way for shareholders to build up their shareholding in the Company. Instead of receiving cash dividends they can elect to receive new shares in the Company.

A total of 706,138 new Ordinary shares were issued under the Scheme during the period at a price of 90.00 pence each.

Further information on the Scheme, including details of where to obtain an application form, can be found in Shareholder Information.

Shareholder communications

The Investment Adviser held its seventh annual shareholder event on 24 January 2017. The event was well attended and we were pleased to hear from the Investment Adviser that it received positive feedback from shareholders. The next event is to be held on Tuesday, 30 January 2018, again at the Royal Institute of British Architects in Central London. The programme will again include presentations on the investment activity and performance of the Mobeus VCTs as well as an update on the recent regulatory changes and talks from investee companies. Shareholders have been sent further details, and an invitation to the event, with the shareholder newsletter sent last week.

Outlook

The UK economy continues to be subject to the uncertainties arising both out of the ability of the UK government to negotiate a satisfactory exit from the European Union and from the recent UK election result. Nevertheless the demand from small UK businesses for development capital remains strong and there continues to be a healthy market to purchase quality smaller companies at attractive prices.

Both the Board and the Investment Adviser continue to have a positive outlook about the Company's future prospects. The small and medium-sized enterprises (SME) segment is a dynamic target universe for new investment, where the Investment Adviser is reviewing many promising opportunities. The Investment Adviser continues to expand its team and capabilities and has adapted well to the requirements of the new Investment Policy.

The existing portfolio continues to comprise predominantly established, profitable companies that have been conservatively financed, but over time the growth capital investments will represent a growing proportion. The latter will tend to be younger, and may not always be profitable at the time of investment. They will typically exhibit more volatility in returns and generate less income as they tend to re-invest profits during their growth phase, but may offer the prospect of higher capital returns.

Finally, I would like to thank shareholders for their continuing support.

Christopher Moore

Chairman

8 August 2017

Investment Policy

The investment policy is designed to meet the Company's objective.

Investments

The Company invests primarily in a diverse portfolio of UK unquoted companies. Investments are made selectively across a number of sectors, principally in established companies. Investments are usually structured as part loan stock and part equity in order to produce a regular income stream and to generate capital gains from realisations.

There are a number of conditions within the VCT legislation which need to be met by the Company and which may change from time to time. The Company will seek to make investments in accordance with the requirements of prevailing VCT legislation.

Asset allocation and risk diversification policies, including the size and type of investments the Company makes, are determined in part by the requirements of prevailing VCT legislation. No single investment may represent more than 15 per cent. (by VCT tax value) of the Company's total investments at the date of investment.

Liquidity

The Company's cash and liquid funds are held in a portfolio of readily realisable interest bearing investments, deposit and current accounts, of varying maturities, subject to the overriding criterion that the risk of loss of capital be minimised.

Borrowing

The Company's articles of association permit borrowings of amounts up to 10 per cent. of the adjusted capital and reserves (as defined therein). However, the Company has never borrowed and the Board would only consider doing so in exceptional circumstances.

Summary of VCT Regulation

Investment Review

New investments in the Half-Year

A total of £1.65 million was invested into three new companies during the six months under review plus one existing portfolio company. This comprised new investments into Tapas Revolution, Buster & Punch, MyTutor and a follow on investment in BookingTek. One further investment in Wetsuit Outlet was completed after the period end.

A further small loan investment of £0.07 million was made into BookingTek Limited (which provides direct booking software for hotel groups), to fund an opportunity for US expansion.

New investment post period-end

Realisations in the period

There were no realisations during the period under review, although there was one substantial realisation shortly after the period end (Entanet Holdings Limited) as set out below:

Loan stock repayments

Loan stock repayments totalled £4.40 million. These proceeds are summarised below:-

Mobeus Equity Partners LLP

Investment Adviser

8 August 2017

Investment Portfolio Summary

at 30 June 2017

1 - Entanet Holdings Limited was realised after the period end. The valuation at 30 June 2017 reflects the actual proceeds received.

2 - £1,134,000 invested in Chatfield Services Limited, a company preparing to trade, was used for the investment into Buster & Punch. This resulted in a net repayment to the company of £603,608.

Statements of the Directors' Responsibilities

Responsibility Statement

In accordance with Disclosure and Transparency Rule (DTR) 4.2.10, Christopher Moore (Chairman), Andrew Robson (Chairman of the Audit Committee and Nomination and Remuneration Committee) and Helen Sinclair (Chairman of the Investment Committee), being the Directors of the Company confirm that to the best of their knowledge:

(a) the condensed set of financial statements, which has been prepared in accordance with Financial Reporting Standard 104 "Interim Financial Reporting" gives a true and fair view of the assets, liabilities, financial position and profit of the Company, as required by DTR 4.2.10;

(b) the Half-Year Management Report which comprises the Chairman's Statement, Investment Policy, Investment Review and the Investment Portfolio Summary includes a fair review of the information required by DTR 4.2.7, being an indication of the important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements;

(c) a description of the principal risks and uncertainties facing the Company for the remaining six months is set out below, in accordance with DTR 4.2.7; and

(d) there were no related party transactions in the first six months of the current financial year that are required to be disclosed, in accordance with DTR 4.2.8.

Principal Risks and Uncertainties

In accordance with DTR 4.2.7, the Board confirms that the principal risks and uncertainties facing the Company have not changed materially from those identified in the Annual Report and Accounts for the year ended 31 December 2016 ("the Annual Report").

The principal risks faced by the Company are:

• economic risk;

• loss of approval as a Venture Capital Trust;

• investment risk;

• regulatory risk;

• financial and operating risk;

• market risk;

• asset liquidity risk;

• market liquidity risk; and

• counterparty risk.

A detailed explanation of these risks can be found in the Annual Report on page 19 and in Note 15 on pages 54 - 60 of the Annual Report and Accounts for the year ended 31 December 2016, copies of which are available on the Investment Adviser's website, www.mobeusequity.co.uk or by going directly to the VCT's website, www.mig4vct.co.uk.

Going Concern

The Board has assessed the Company's operation as a going concern. The Company's business activities, together with the factors likely to affect its future development, performance and position are set out in the Half-Year Management Report. The Directors have satisfied themselves that the Company continues to maintain a significant cash position but does intend to raise funds from an offer of subscription later this year. The majority of companies in the portfolio continue to trade profitably and the portfolio taken as a whole remains resilient and well-diversified. The major cash outflows of the Company (namely investments, buybacks and dividends) are within the Company's control.

The Board's assessment of liquidity risk and details of the Company's policies for managing its capital and financial risks are shown in Notes 15 and 16 on pages 54 - 61 of the Annual Report and Accounts for the year ended 31 December 2016. Accordingly, the Directors continue to adopt the going concern basis of accounting in preparing the half-year report and annual financial statements.

Cautionary Statement

This report may contain forward looking statements with regards to the financial condition and results of the Company, which are made in the light of current economic and business circumstances. Nothing in this report should be construed as a profit forecast.

On behalf of the Board

Christopher Moore

Chairman

8 August 2017

Unaudited Condensed Income Statement

for the six months ended 30 June 2017

The revenue column of the Income Statement includes all income and expenses. The capital column accounts for the unrealised gains/(losses) and realised gains on investments and the proportion of the Investment Adviser's fee charged to capital.

The total column is the Statement of Total Comprehensive Income of the Company prepared in accordance with UK GAAP, including Financial Reporting Standard 102. In order to better reflect the activities of a VCT and in accordance with the 2014 Statement of Recommended Practice ("SORP") updated in January 2017 by the Association of Investment Companies ("AIC"), supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented alongside the Income Statement. The revenue column of profit attributable to equity shareholders is the measure the Directors believe appropriate in assessing the Company's compliance with certain requirements set out in Section 274 Income Tax Act 2007.

All the items in the above statement derive from continuing operations of the Company. No operations were acquired or discontinued in the period.

Unaudited Condensed Balance Sheet

as at 30 June 2017

Unaudited Condensed Statement of Changes in Equity

for the six months ended 30 June 2017

Notes

a): The cancellation of the share premium reserve and capital redemption reserve has increased the Company's special distributable reserve. The purpose of this reserve is to fund market purchases of the Company's own shares, write off any existing and future losses and for any other corporate purpose. All of this reserve arose from shares issued before 5 April 2014.

b): The Realised capital reserve and the Revenue reserve together comprise the Profit and Loss Account of the Company.

Unaudited Condensed Statement of Changes in Equity

for the six months ended 30 June 2016