19 Aug 2008 13:37
Neptune-Calculus Income and Growth VCT plc
Half-yearly results for the six months ended 30 June 2008
CORPORATE POLICY AND PERFORMANCE SUMMARY
Objective
The Neptune-Calculus Income and Growth VCT is a generalist VCT which has the objective of providing investors with both capital growth and income.
It is intended that approximately 75 per cent. of the Company's funds will be invested over a three year period in a diversified portfolio of holdings in qualifying investments including AIM companies. The Company does not invest in start-up and seed capital situations. The balance of the Company's investments will be invested in a combination of Neptune income funds and a portfolio of similar income generating UK listed shares and money market instruments.
Managers
Qualifying investments are managed by Calculus Capital Limited and non-qualifying investments are managed by Neptune Investment Management Limited.
Performance summary
| Ordinary Shares | C Shares | |
| Six months to | Six months to | |
| 30 June 2008 | 30 June 2008 | |
| Return per share | (0.8)p | (2.5)p |
| Net asset value per share | 97.0p | 90.1p |
| Cumulative dividends paid and proposed | 7.0p | 3.0p |
Chairman's Statement
I am delighted to present our half-yearly results for the Company for the six months ended 30 June 2008.
In a period of significant turbulence in the market and in the overall economy, I am pleased to be able to report a reasonably satisfactory set of results. Having said that, we still have to report that net asset values per share for the Ordinary Shares and the C Shares have fallen by 1.1 per cent. and 2.8 per cent. respectively. Clearly we have not been immune from the decline in the quoted market with the FTSE All-share index falling around 11 per cent. in the period, which has affected the values of our non-qualifying portfolios.
However, the values of our qualifying portfolios have remained relatively stable over the period, with the Ordinary and C Share portfolios showing modest rises equivalent to 3.1 pence and 2.9 pence respectively in terms of the impact on each fund's net asset value despite difficult market conditions. We have been encouraged by the performance of our unquoted qualifying investments, particularly Cater Plus Services and RMS Group Holdings. In our AIM portfolio, Portland Gas, Pressure Technologies and Epistem Holdings all posted significant increases in the six months.
Activity in the qualifying portfolio as far as further investment is concerned has been relatively quiet reflecting both the Manager's cautious stance and the fact that we are moving towards meeting the requirement for 70 per cent. of the portfolio to be invested in VCT qualifying investments by 31 December 2008. As is reported in the Investment Managers' Review (Qualifying Investments), good progress has been made and as at 30 June 2008, 66.3 per cent. of the combined Ordinary and C Share portfolios had been invested in qualifying investments.
Notwithstanding the negative return over the period, the Directors are pleased to declare interim dividends in respect of the Ordinary Shares and the C Shares each of 1p per Share at a cost to the Ordinary and C Share Funds of £41,008 and £87,768, respectively. Both dividends will be payable on 20 October 2008, to shareholders on the register on 26 September 2008. At the end of 2007, we launched an offer for subscription to raise new funds for the Company. The offer closed on 3 April 2008 and net of expenses raised £290,888 and £340,288 for the Ordinary and C Share Funds, respectively.
For some years a debate has been taking place between the Investment Trust movement and HMRC concerning the charging of VAT on management fees. I am pleased to report that HMRC have recently agreed to exempt VCTs from VAT on management fees and that recovery of VAT paid can be backdated for three years. We are taking action to reclaim the VAT which has been paid on management fees and are holding discussions with our Investment Managers. The timing and amount of any payment is still uncertain. As a result no contingent asset has been included within these financial statements.
As I said in my statement with the Annual Report, we hoped that the current turbulence in the equity markets and the economy might lead to more attractive qualifying investment opportunities in both the unquoted and quoted sectors. We believe that there is evidence to support this view, but we remain cautious and selective in our investment policy.
Philip Stephens
Chairman
INVESTMENT MANAGERS' REVIEWS
Investment Manager's review (Qualifying investments)
Calculus Capital advises the Company in respect of qualifying investments made by the Company.
Portfolio developments
At the 30 June, the Ordinary Share Fund's and C Share Fund's qualifying investments comprised 20 and 16 companies respectively. At 31 December 2007, we had met the HM Revenue & Customs requirement for the Ordinary Share Fund to be at least 70 per cent. invested in qualifying investments. The major VCT test which the Company needs to meet this year is to be at least 70 per cent. invested in qualifying investments for the Ordinary Share and C Share Funds combined by 31 December 2008. The Company has made good progress toward this target and at 30 June was 66.3 per cent. invested (calculated on an HM Revenue & Customs basis).
The qualifying portfolio comprises both unquoted and AIM quoted smaller companies. Both the Ordinary and C Share portfolios showed an uplift in value over the period, with an increase in the valuation of the unquoted investments offsetting a slight decline in the valuation of the quoted stocks. Conditions since the beginning of the year have been challenging. The FTSE AIM All-share Index has fallen over 8 per cent. during the period. The index has a heavy weighting of strongly performing natural resources stocks which, in general, are not eligible to be VCT qualifying investments. Without these, the index drop would have been much larger.
Against this backdrop of difficult macro-economic and quoted market conditions, we are encouraged by the performance of both the unquoted and quoted components of the portfolios. Although there has been volatility within the portfolios with some stocks showing sharp rises and others heavy falls, , the Ordinary Share qualifying portfolio and the C Share qualifying portfolio each showed a rise equivalent to approximately 3.1 pence and 2.9 pence, respectively in terms of the impact on each Fund's net asset value. We are happy with the constituents of the portfolio. Most of the companies are making good progress, even where their share prices, if quoted, may not currently reflect this. Many of the quoted shares in the portfolio are on ratings which, historically, look exceptionally good long term value. The portfolio has little exposure to technology or early stage companies which may be more at risk in time of economic downturn. One should also highlight the fact that, in our AIM portfolio, we enjoyed some good performances, namely from Portland Gas, Pressure Technologies and Epistem Holdings, all of which have posted significant increases in the six months.
We have maintained a disciplined and selective approach to investment since the beginning of the year, conscious of the risks in investing in an environment in which asset values were generally falling. During the period, we increased our investment in two existing portfolio companies:
| Company and activity | Type of investment | Ordinary Share Fund | C Share Fund |
| Relax Group plc (formerly Debts.co.uk plc) Consumer debt advisory and corporate insolvency services | Equity | £75,000 | £175,000 |
| Heritage House Media Limited Publishing and media services to the heritage sector | Equity Loan stock | £21,051 £22,454 | £42,017 £44,915 |
Subsequent to the period end, we invested £300,000 as ordinary equity in AIM quoted Optare plc (formerly Darwen Holdings plc) which manufactures a range of diesel and hybrid low emission buses. The market for buses is being stimulated by central and local government transportation policies and operators' demand for fuel efficient and low emission vehicles. The investment was made on behalf of the C Share Fund.
All of the above investments were subscribed as part of a package of acquisition finance. In the case of Heritage House Media, the acquisition was of publishing contracts from VisitBritain, Britain's national tourism agency.
Outlook
We continue to seek out attractive opportunities for unquoted investment. Such funding can cover the provision of expansion finance, finance for acquisitions and support for management buy-ins and buy-outs. These situations often offer an attractive balance of risk and reward but tend to be more complex and time consuming to complete than investment in quoted stocks.
There is clear evidence that the UK economy is starting to slow as a weaker housing market, rising inflation and liquidity issues in the banking sector reduce GDP below historic trend. At present, it is not possible to say how sharp the slowdown will be. The Company has funds available for investment in qualifying investments. Whilst it can be uncomfortable to be in the midst of adverse economic and market conditions, we believe that such challenging conditions can be helpful in providing a flow of opportunities at attractive entry level valuations.
John Glencross
Calculus Capital Limited
Investment manager's review (non-qualifying investments)
Portfolio developments
The Neptune-Calculus Income and Growth VCT invests in the Neptune Income Fund and the Neptune Quarterly Income Fund along with a portfolio of individual stocks that broadly follows the aforementioned funds.
During the six months under review the FTSE All-share index fell 11.2 per cent.* It was led lower by the FTSE Small Cap and FTSE 250 indices, which lost 14.9 per cent.* and 12.7 per cent.* respectively. The period saw large-cap companies outperforming the rest of the market, excluding AIM, with the FTSE 100 falling 10.8 per cent.* As a result, the portfolio of non-qualifying investments benefited owing to our high large-cap weighting. As a guide to the portfolio's performance, the Neptune Income Fund and Neptune Quarterly Income Fund fell 12.2 per cent. and 9.2 per cent. respectively during the six months. This performance placed both funds in the top quartile of the IMA UK Equity Income sector over the same period, where the average fund declined by 14.6 per cent.*
UK equity markets failed to escape the bearish sentiment that has gripped global equities. The first quarter of 2008 was characterised by excessive volatility, a raft of profit warnings at company-specific level and further evidence that developing world economies were slowing. We also saw continued turmoil in the financials sector with the demise of Bear Stearns, a former heavyweight in the financial world, as well as further asset write-downs by the UK banks.
The second quarter saw investors grappling with a toxic cocktail of rising inflation expectations as oil and food prices soared, falling growth forecasts, low consumer confidence levels and further bad news from the financials sector as the credit crisis refused to abate. Against this uncompromising backdrop, the UK equity market continued to move lower, albeit after a rally extending to the midpoint of the quarter - a classic bear market rally in our opinion.
The majority of our performance can be attributed to our sector allocation and bias towards large-cap stocks. In terms of sectors, we had good exposure to the strongest performing areas in the market, which included energy, materials and healthcare, and equally importantly we maintained our zero-weight position in banks, which significantly underperformed. We made few changes other than to reduce our consumer weighting in favour of materials and energy. These changes reflect our views on the weak UK consumer and the combination of emerging market demand and tight supply driving prices of resources higher over the year.
Outlook
Looking forward to the remainder of 2008, we expect continuing volatility in global markets and remain cautious of financials and consumer-facing stocks. However, we are optimistic on the prospects for real world growth and expect evidence in the coming months of continuing strong growth in China, India, Latin America and Russia. The portfolio is positioned to benefit from exposure to global themes and from market leadership by large-cap stocks in the UK. Critically, our unconstrained approach gives the freedom to invest with conviction in the numerous investment opportunities remaining while - equally importantly - avoiding the poorest performing areas of the market.
Robin Geffen
Neptune Investment Management Limited
* Performance figures sourced from Lipper; based in Sterling; net income reinvested.
INVESTMENT PORTFOLIOS
Ordinary Share Fund portfolio
The ten largest holdings by value are included below:
As at 30 June 2008
| Cost | Valuation | Percentage of portfolio | |
| £ | £ | % | |
| AIM investments (quoted equity) | |||
| Portland Gas plc* | 160,052 | 373,267 | 9.5 |
| Epistem Holdings plc* | 125,434 | 181,901 | 4.6 |
| Pressure Technologies plc | 100,401 | 173,852 | 4.4 |
| Other AIM investments | 1,606,337 | 814,218 | 20.6 |
| Unquoted equity investments | |||
| RMS Group Holdings Ltd | 32,000 | 160,320 | 4.1 |
| Cater Plus Services Limited | 17,500 | 82,317 | 2.1 |
| Triage Holdings Limited | 16,000 | 66,400 | 1.7 |
| Heritage House Media Limited | 49,121 | 24,757 | 0.6 |
| Other unquoted equity investments | 100,558 | 30,000 | 0.8 |
| Unquoted preference shares | |||
| Triage Holdings Limited preference shares | 119,240 | 119,240 | 3.0 |
| Cater Plus Services Limited preference shares | 40,833 | 40,833 | 1.0 |
| Unquoted bonds | |||
| Heritage House Media Limited loan stockƗ | 212,252 | 212,252 | 5.4 |
| RMS Group Holdings Limited loan stock | 128,000 | 128,000 | 3.2 |
| Cater Plus Services Limited loan stock | 116,667 | 116,667 | 3.0 |
| Triage Holdings Limited loan stock | 24,760 | 24,760 | 0.6 |
| Other unquoted loan stocks | 120,000 | 120,000 | 3.0 |
| Non-qualifying equity investments and loan stockƗ* | (25,202) | (22,270) | (0.6) |
| Total qualifying investments | 2,943,955 | 2,646,514 | 67.1 |
| Quoted funds | |||
| Neptune Quarterly Income Fund Income Units | 439,047 | 531,533 | 13.5 |
| The Neptune Income Fund Income A Class | 435,453 | 494,507 | 12.5 |
| Unquoted funds | |||
| Goldman Sachs Sterling Liquid Reserve Fund | 250,000 | 250,000 | 6.3 |
| Other unquoted funds | 415 | 415 | 0.0 |
| Non-qualifying equity investments and loan stockƗ* | 25,202 | 22,270 | 0.6 |
| Total non-qualifying investments | 1,150,117 | 1,298,725 | 32.9 |
| Total investments | 4,094,072 | 3,945,239 | 100.0 |
*The valuations of certain Ordinary Share Fund investments include small purchases made which are non-qualifying investments. These cost £7,334 and are valued at £4,402.
ƗThe valuation of Heritage House Media Limited loan stock includes £17,868 of rolled up interest which is non-qualifying.
INVESTMENT PORTFOLIOS
C Share Fund portfolio
The ten largest holdings by value are included below:
As at 30 June 2008
| Cost | Valuation | Percentage of portfolio | |
| £ | £ | % | |
| AIM investments (quoted equity) | |||
| Portland Gas plc | 290,886 | 678,704 | 9.3 |
| FSG Security plc | 250,000 | 183,333 | 2.5 |
| Epistem Holdings plc | 125,001 | 181,453 | 2.5 |
| Other AIM investments | 1,663,226 | 862,524 | 11.9 |
| Unquoted equity investments | |||
| RMS Group Holdings Limited | 68,044 | 340,730 | 4.7 |
| Cater Plus Services Limited | 32,629 | 152,944 | 2.1 |
| Triage Holdings Limited | 32,000 | 132,800 | 1.8 |
| Heritage House Media Limited | 98,248 | 49,517 | 0.7 |
| Other unquoted equity investments | 351,116 | 125,000 | 1.7 |
| Unquoted preference shares | |||
| Triage Holdings Limited preference shares | 238,480 | 238,480 | 3.3 |
| Cater Plus Services Limited preference shares | 75,834 | 75,834 | 1.0 |
| Unquoted bonds | |||
| Heritage House Media Limited loan stockƗ | 424,511 | 424,511 | 5.9 |
| RMS Group Holdings Limited loan stock | 272,000 | 272,000 | 3.7 |
| Cater Plus Services Limited loan stock | 216,666 | 216,666 | 3.0 |
| Triage Holdings Limited loan stock | 49,520 | 49,520 | 0.7 |
| Non qualifying equity investments and loan stockƗ* | (36,321) | (36,201) | (0.5) |
| Total qualifying investments | 4,151,839 | 3,947,815 | 54.4 |
| Quoted funds | |||
| Neptune Quarterly Income Fund Income Units | 810,000 | 784,815 | 10.8 |
| The Neptune Income Fund Income A Class | 825,000 | 769,051 | 10.6 |
| Other quoted equities | 1,432,213 | 1,357,130 | 18.7 |
| Unquoted funds | |||
| Goldman Sachs Sterling Liquid Reserve Fund | 250,000 | 250,000 | 3.5 |
| Other unquoted funds | 108,507 | 108,507 | 1.5 |
| Non-qualifying equity investments and loan stockƗ* | 36,321 | 36,201 | 0.5 |
| Total non-qualifying investments | 3,462,041 | 3,305,704 | 45.6 |
| Total investments | 7,613,880 | 7,253,519 | 100.0 |
The valuations of certain C Share Fund investments include small purchases made which are non-qualifying investments. These cost £584 and are valued at £464.
ƗThe valuation of Heritage House Media Limited loan stock includes £35,737 of rolled up interest which is non-qualifying..
UNAUDITED INCOME STATEMENTS
for the six months to 30 June 2008
Ordinary Share Fund
| | | Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |||||||
| | | Revenue | Capital | Total | Revenue | Capital | Total | Revenue | Capital | Total | |
| | Note | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | |
| | | | | | | | | | | | |
| (Losses)/gains on investments at fair value | - | (18) | (18) | - | 227 | 227 | - | (421) | (421) | ||
| Investment income | | 59 | - | 59 | 61 | - | 61 | 129 | - | 129 | |
| Other income | | 3 | - | 3 | 3 | - | 3 | 4 | - | 4 | |
| Investment management fee | | (11) | (33) | (44) | (13) | (38) | (51) | (19) | (57) | (76) | |
| Other expenses | | (32) | - | (32) | (27) | - | (27) | (55) | - | (55) | |
| | | | | | | | | | | | |
| Return/(deficit) on ordinary activities before taxation | | 19 | (51) | (32) | 24 | 189 | 213 | 59 | (478) | (419) | |
| | | | | | | | | | | | |
| Taxation on ordinary activities | | (1) | - | (1) | (1) | - | (1) | (2) | - | (2) | |
| | | | | | | | | | | | |
| Return/(deficit) attributable to equity shareholders | | 18 | (51) | (33) | 23 | 189 | 212 | 57 | (478) | (421) | |
| | | | | | | | | | | | |
| Return per Ordinary Share | 3 | 0.45p | (1.29)p | (0.84)p | 0.60p | 5.00p | 5.60p | 1.51p | (12.59)p | (11.08)p | |
The accompanying notes are an integral part of this statement.
C Share Fund
| | | | Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | ||||||
| | | | Revenue | Capital | Total | Revenue | Capital | Total | Revenue | Capital | Total |
| | Note | | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 | £’000 |
| | | | | | | | | | | | |
| (Losses)/gains on investments at fair value | | | - | (196) | (196) | - | 431 | 431 | - | (752) | (752) |
| Investment income | | | 133 | - | 133 | 134 | - | 134 | 272 | - | 272 |
| Other income | | | 7 | - | 7 | 3 | - | 3 | 7 | - | 7 |
| Investment management fee | | | (23) | (69) | (92) | (26) | (77) | (103) | (38) | (115) | (153) |
| Other expenses | | | (66) | - | (66) | (59) | - | (59) | (119) | - | (119) |
| | | | | | | | | | | | |
| Return/(deficit) on ordinary activities before taxation | 51 | (265) | (214) | 52 | 354 | 406 | 122 | (867) | (745) | ||
| | | | | | | | | | | | |
| Taxation on ordinary activities | | | (2) | - | (2) | (1) | - | (1) | (3) | - | (3) |
| | | | | | | | | | | | |
| Return/(deficit) attributable to equity shareholders | | 49 | (265) | (216) | 51 | 354 | 405 | 119 | (867) | (748) | |
| | | | | | | | | | | | |
| Return per C Share | 3 | | 0.57p | (3.08)p | (2.51)p | 0.61p | 4.22p | 4.83p | 1.42p | (10.34)p | (8.92)p |
UNAUDITED INCOME STATEMENTS
for the six months to 30 June 2008
Total
|
|
|
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | ||||||
|
|
| Revenue | Capital | Total | Revenue | Capital | Total | Revenue | Capital | Total | |
|
|
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
|
|
|
|
|
|
|
|
|
|
|
|
|
| (Losses)/gains on investments at fair value |
|
| - | (214) | (214) | - | 658 | 658 | - | (1,173) | (1,173) |
| Investment income |
|
| 192 | - | 192 | 195 | - | 195 | 401 | - | 401 |
| Other income |
|
| 10 | - | 10 | 6 | - | 6 | 11 | - | 11 |
| Investment management fee |
|
| (34) | (102) | (136) | (39) | (115) | (154) | (57) | (172) | (229) |
| Other expenses |
|
| (98) | - | (98) | (86) | - | (86) | (174) | - | (174) |
|
|
|
|
|
|
| ||||||
| Return/(deficit) on ordinary activities before taxation | 70 | (316) | (246) | 76 | 543 | 619 | 181 | (1,345) | (1,164) | ||
|
|
|
| |||||||||
| Taxation on ordinary activities |
| (3) | - | (3) | (2) | - | (2) | (5) | - | (5) | |
|
|
|
|
|
|
|
|
|
| |||
| Return/(deficit) attributable to equity shareholders | 67 | (316) | (249) | 74 | 543 | 617 | 176 | (1,345) | (1,169) | ||
The total column of this statement is the profit and loss account of the Company.
All revenue and capital items in the above statement derive from continuing operations. No operations were acquired or discontinued in the period
UNAUDITED RECONCILIATIONS OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the six months to 30 June 2008
Ordinary Share Fund
| Share capital | Share premium | Special reserve | Capital reserve | Revenue reserve | Total | |
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
| For the period 1 January 2008 to 30 June 2008 | ||||||
| 1 January 2008 | 379 | 21 | 3,187 | 100 | 34 | 3,721 |
| Issue of shares | 31 | 277 | - | - | - | 308 |
| Expenses of share issue | - | (17) | - | - | - | (17) |
| Net (deficit)/return after taxation for the period | - | - | - | (51) | 18 | (33) |
| 30 June 2008 | 410 | 281 | 3,187 | 49 | 52 | 3,979 |
| For the period 1 January 2007 to 30 June 2007 | ||||||
| 1 January 2007 | 379 | 21 | 3,187 | 681 | 33 | 4,301 |
| Net return after taxation for the period | - | - | - | 189 | 23 | 212 |
| Dividends paid | - | - | - | (91) | (30) | (121) |
| 30 June 2007 | 379 | 21 | 3,187 | 779 | 26 | 4,392 |
| For the year 1 January 2007 to 31 December 2007 | ||||||
| 1 January 2007 | 379 | 21 | 3,187 | 681 | 33 | 4,301 |
| Net (deficit)/return after taxation for the year | - | - | - | (478) | 57 | (421) |
| Dividends paid | - | - | - | (103) | (56) | (159) |
| 31 December 2007 | 379 | 21 | 3,187 | 100 | 34 | 3,721 |
UNAUDITED RECONCILIATIONS OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the six months to 30 June 2008
C Share Fund
| Share capital | Share premium | Special reserve | Capital reserve | Revenue reserve | Total | |
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
| For the period 1 January 2008 to 30 June 2008 | ||||||
| 1 January 2008 | 839 | - | 7,097 | (230) | 74 | 7,780 |
| Issue of shares | 39 | 321 | - | - | - | 360 |
| Expenses of share issue | - | (19) | - | - | - | (19) |
| Net (deficit)/return after taxation for the period | - | - | - | (265) | 49 | (216) |
| 30 June 2008 | 878 | 302 | 7,097 | (495) | 123 | 7,905 |
| For the period 1 January 2007 to 30 June 2007 | ||||||
| 1 January 2007 | 839 | - | 7,097 | 675 | 85 | 8,696 |
| Net return after taxation for the period | - | - | - | 354 | 51 | 405 |
| Dividends paid | - | - | - | - | (84) | (84) |
| 30 June 2007 | 839 | - | 7,097 | 1,029 | 52 | 9,017 |
| For the year 1 January 2007 to 31 December 2007 | ||||||
| 1 January 2007 | 839 | - | 7,097 | 675 | 85 | 8,696 |
| Net (deficit)/return after taxation for the year | - | - | - | (867) | 119 | (748) |
| Dividends paid | - | - | - | (38) | (130) | (168) |
| 31 December 2007 | 839 | - | 7,097 | (230) | 74 | 7,780 |
UNAUDITED RECONCILIATIONS OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the six months to 30 June 2008
Total
| Share capital | Share premium | Special reserve | Capital reserve | Revenue reserve | Total | |
| £'000 | £'000 | £'000 | £'000 | £'000 | £'000 | |
| For the period 1 January 2008 to 30 June 2008 | ||||||
| 1 January 2008 | 1,218 | 21 | 10,284 | (130) | 108 | 11,501 |
| Issue of shares | 70 | 598 | - | - | - | 668 |
| Expenses of share issue | - | (36) | - | - | - | (36) |
| Net (deficit)/return after taxation for the period | - | - | - | (316) | 67 | (249) |
| 30 June 2008 | 1,288 | 583 | 10,284 | (446) | 175 | 11,884 |
| For the period 1 January 2007 to 30 June 2007 | ||||||
| 1 January 2007 | 1,218 | 21 | 10,284 | 1,356 | 118 | 12,997 |
| Net return after taxation for the period | - | - | - | 543 | 74 | 617 |
| Dividends paid | - | - | - | (91) | (114) | (205) |
| 30 June 2007 | 1,218 | 21 | 10,284 | 1,808 | 78 | 13,409 |
| For the year 1 January 2007 to 31 December 2007 | ||||||
| 1 January 2007 | 1,218 | 21 | 10,284 | 1,356 | 118 | 12,997 |
| Net (deficit)/return after taxation for the year | - | - | - | (1,345) | 176 | (1,169) |
| Dividends paid | - | - | - | (141) | (186) | (327) |
| 31 December 2007 | 1,218 | 21 | 10,284 | (130) | 108 | 11,501 |
UNAUDITED BALANCE SHEETS
as at 30 June 2008
Ordinary Share Fund
|
| 30 June 2008 | 30 June 2007 | 31 December 2007 | |
|
| Note | £'000 | £'000 | £'000 |
| Fixed Assets |
|
| ||
| Investments at fair value through profit or loss |
| 3,945 | 4,330 | 3,659 |
| Current Assets |
| |||
| Debtors |
| 39 | 46 | 26 |
| Cash at bank |
| 42 | 27 | 57 |
|
|
| 81 | 73 | 83 |
| Creditors: Amounts falling due within one year | ||||
|
| ||||
| Creditors |
| (47) | (11) | (20) |
| Bank overdraft | - | - | (1) | |
| (47) | (11) | (21) | ||
| Net Current Assets |
| 34 | 62 | 62 |
| Net Assets | 3,979 | 4,392 | 3,721 | |
|
|
| |||
| Represented by: |
| |||
| CALLED UP SHARE CAPITAL AND RESERVES |
|
| ||
| Share capital | 410 | 379 | 379 | |
| Share premium |
| 281 | 21 | 21 |
| Special reserve | 3,187 | 3,187 | 3,187 | |
| Capital reserve realised | 198 | 206 | 231 | |
| Capital reserve unrealised |
| (149) | 573 | (131) |
| Revenue reserve |
| 52 | 26 | 34 |
| Total equity shareholders' funds |
| 3,979 | 4,392 | 3,721 |
| Net asset value per Ordinary Share | 4 | 97.03p | 115.77p | 98.09p |
The accompanying notes are an integral part of this statement.
UNAUDITED BALANCE SHEETS
as at 30 June 2008
C Share Fund
|
| 30 June 2008 | 30 June 2007 | 31 December 2007 | |
|
| Note | £'000 | £'000 | £'000 |
| Fixed Assets |
|
| ||
| Investments at fair value through profit or loss |
| 7,254 | 8,978 | 7,581 |
| Current Assets |
| |||
| Debtors |
| 251 | 23 | 26 |
| Cash at bank |
| 503 | 39 | 217 |
|
|
| 754 | 62 | 243 |
| Creditors: Amounts falling due | ||||
| within one year |
| |||
| Creditors |
| (103) | (23) | (44) |
| Net Current Assets |
| 651 | 39 | 199 |
| Net Assets | 7,905 | 9,017 | 7,780 | |
|
|
| |||
| Represented by: |
| |||
| CALLED UP SHARE CAPITAL AND RESERVES |
|
| ||
| Share capital | 878 | 839 | 839 | |
| Share premium | 302 | - | - | |
| Special reserve | 7,097 | 7,097 | 7,097 | |
| Capital reserve realised | (135) | 110 | (82) | |
| Capital reserve unrealised |
| (360) | 919 | (148) |
| Revenue reserve |
| 123 | 52 | 74 |
| Total equity shareholders' funds |
| 7,905 | 9,017 | 7,780 |
| Net asset value per C Share | 4 | 90.07p | 107.43p | 92.69p |
The accompanying notes are an integral part of this statement.
UNAUDITED BALANCE SHEETS
as at 30 June 2008
Total
|
| 30 June 2008 | 30 June 2007 | 31 December 2007 | |
|
| £'000 | £'000 | £'000 | |
| Fixed Assets |
|
| ||
| Investments at fair value through profit or loss |
| 11,199 | 13,308 | 11,240 |
| Current Assets |
| |||
| Debtors |
| 290 | 69 | 52 |
| Cash at bank |
| 545 | 66 | 274 |
|
|
| 835 | 135 | 326 |
| Creditors: Amounts falling due | ||||
| within one year |
| |||
| Creditors |
| (150) | (34) | (64) |
| Bank overdraft | - | - | (1) | |
| (150) | (34) | (65) | ||
| Net Current Assets |
| 685 | 101 | 261 |
| Net Assets | 11,884 | 13,409 | 11,501 | |
|
|
| |||
| Represented by: |
| |||
| CALLED UP SHARE CAPITAL AND RESERVES |
|
| ||
| Share capital |
| 1,288 | 1,218 | 1,218 |
| Share premium |
| 583 | 21 | 21 |
| Special reserve | 10,284 | 10,284 | 10,284 | |
| Capital reserve realised | 63 | 316 | 149 | |
| Capital reserve unrealised |
| (509) | 1,492 | (279) |
| Revenue reserve |
| 175 | 78 | 108 |
| Total equity shareholders' funds |
| 11,884 | 13,409 | 11,501 |
.
UNAUDITED CASH FLOW STATEMENTS
for the six months to 30 June 2008
Ordinary Share Fund
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | ||
| Note | £'000 | £'000 | £'000 | |
| Operating activities | ||||
| Investment income received | 41 | 51 | 110 | |
| Deposit income received | 2 | 3 | 5 | |
| Investment management fees paid | (16) | (66) | (94) | |
| Administration fees paid | (6) | (9) | (13) | |
| Other cash payments | (25) | (30) | (38) | |
| Net cash outflow from operating activities | 5 | (4) | (51) | (30) |
| Taxation | (1) | (1) | (2) | |
| Investing activities | ||||
| Purchase of investments | (369) | (1,919) | (2,683) | |
| Sale of investments | 76 | 2,064 | 2,875 | |
| Net cash (outflow)/inflow from investing activities | (293) | 145 | 192 | |
| Equity dividends paid | - | (121) | (159) | |
| Financing | ||||
| Proceeds of share issue | 308 | - | - | |
| Cost of share issue | (24) | (4) | (4) | |
| Net cash inflow/(outflow) from financing | 284 | (4) | (4) | |
| Decrease in cash | (14) | (32) | (3) | |
The accompanying notes are an integral part of this statement.
UNAUDITED CASH FLOW STATEMENTS
for the six months to 30 June 2008
C Share Fund
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | ||
| Note | £'000 | £'000 | £'000 | |
| Operating activities | ||||
| Investment income received | 103 | 133 | 263 | |
| Deposit income received | 5 | 4 | 8 | |
| Investment management fees paid | (33) | (141) | (198) | |
| Administration fees paid | (13) | (19) | (26) | |
| Other cash payments | (58) | (64) | (84) | |
| Net cash inflow/(outflow) from operating activities | 5 | 4 | (87) | (37) |
| Taxation | (2) | (1) | (3) | |
| Investing activities | ||||
| Purchase of investments | (512) | (2,459) | (4,033) | |
| Sale of investments | 461 | 2,619 | 4,407 | |
| Net cash (outflow)/inflow from investing activities | (51) | 160 | 374 | |
| Equity dividends paid | - | (84) | (168) | |
| Financing | ||||
| Proceeds of share issue | 361 | - | - | |
| Cost of share issue | (26) | (109) | (109) | |
| Net cash inflow/(outflow) from financing | 335 | (109) | (109) | |
| Increase/(decrease) in cash | 286 | (121) | 57 | |
The accompanying notes are an integral part of this statement.
UNAUDITED CASH FLOW STATEMENTS
for the six months to 30 June 2008
Total
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | ||
| Note | £'000 | £'000 | £'000 | |
| Operating activities | ||||
| Investment income received | 144 | 184 | 373 | |
| Deposit income received | 7 | 7 | 13 | |
| Investment management fees paid | (49) | (207) | (292) | |
| Administration fees paid | (19) | (28) | (39) | |
| Other cash payments | (83) | (94) | (122) | |
| Net cash outflow from operating activities | 5 | - | (138) | (67) |
| Taxation | (3) | (2) | (5) | |
| Investing activities | ||||
| Purchase of investments | (881) | (4,378) | (6,716) | |
| Sale of investments | 537 | 4,683 | 7,282 | |
| Net cash (outflow)/inflow from investing activities | (344) | 305 | 566 | |
| Equity dividends paid | - | (205) | (327) | |
| Financing | ||||
| Proceeds of share issue | 669 | - | - | |
| Cost of share issue | (50) | (113) | (113) | |
| Net cash inflow/(outflow) from financing | 619 | (113) | (113) | |
| Increase/(decrease) in cash | 272 | (153) | 54 | |
The accompanying notes are an integral part of this statement.
NOTES TO THE FINANCIAL STATEMENTS
1 Nature of Financial Information
The unaudited half-yearly financial information does not constitute statutory financial statements as defined in Section 240 of the Companies Act 1985. This information has been prepared on the basis of the accounting policies used in the statutory financial statements of the Company for the year ended 31 December 2007. The statutory financial statements for the year ended 31 December 2007, which contained an unqualified auditors' report, have been lodged with the Registrar of Companies, did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report and did not contain statements under Section 237(2) or (3) of the Companies Act 1985.
2 Dividends
The directors have declared an interim dividend of 1 penny per Ordinary Share and per C Share. Both dividends are payable on 20 October 2008 to Ordinary and C shareholders on the register on 26 September 2008.
3 Return per share
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |||||||
| Revenue | Capital | Total | Revenue | Capital | Total | Revenue | Capital | Total | |
| pence | pence | pence | pence | pence | pence | pence | pence | pence | |
| Ordinary Share | 0.45 | (1.29) | (0.84) | 0.60 | 5.00 | 5.60 | 1.51 | (12.59) | (11.08) |
| C Share | 0.57 | (3.08) | (2.51) | 0.61 | 4.22 | 4.83 | 1.42 | (10.34) | (8.92) |
Ordinary Shares
Revenue return per Ordinary Share is based on the net revenue on ordinary activities attributable to the Ordinary Shares of £18,000 (30 June 2007: £23,000, 31 December 2007: £57,000) and on 3,966,853 (30 June 2007: 3,793,562, 31 December 2007: 3,793,562) Ordinary Shares, being the weighted average number of Ordinary Shares in issue during the period.
3 Return per share (continued)
Capital return per Ordinary Share is based on the net capital deficit for the period of £51,000 (30 June 2007: gain of £189,000, 31 December 2007: deficit of £478,000) and on 3,966,853 (30 June 2007: 3,793,562, 31 December 2007: 3,793,562) Ordinary Shares, being the weighted average number of Ordinary Shares in issue during the period.
Total return per Ordinary Share is based on the total deficit on ordinary activities attributable to the Ordinary Shares of £33,000 (30 June 2007: gain of £212,000, 31 December 2007: deficit of £421,000) and on 3,966,853 (30 June 2007: 3,793,562, 31 December 2007: 3,793,562) Ordinary Shares, being the weighted average number of Ordinary Shares in issue during the period.
C Shares
Revenue return per C share is based on the net revenue on ordinary activities attributable to the C Shares of £49,000 (30 June 2007: £51,000, 31 December 2007: £119,000) and on 8,605,748 (30 June 2007: 8,393,209, 31 December 2007: 8,393,209) C Shares, being the weighted average number of C shares in issue during the period.
Capital return per C Share is based on the net capital deficit for the period of £265,000 (30 June 2007: gain of £354,000, 31 December 2007: deficit of £867,000) and on 8,605,748 (30 June 2007: 8,393,209, 31 December 2007: 8,393,209) C Shares, being the weighted average number of C Shares in issue during the period.
Total return per C Share is based on the total deficit on ordinary activities attributable to the C Shares of £216,000 (30 June 2007: gain of £405,000, 31 December 2007: deficit of £748,000) and on 8,605,748 (30 June 2007: 8,393,209, 31 December 2007: 8,393,209) C Shares, being the weighted average number of C Shares in issue during the period.
4 Net asset value per share
| 30 June 2008 | 30 June 2007 | 31 December 2007 | |
| pence | pence | pence | |
| Ordinary Shares of 10p each | 97.03 | 115.77 | 98.09 |
| C Shares of 10p each | 90.07 | 107.43 | 92.69 |
The basic net asset value per Ordinary Share is based on net assets (including current period revenue) of £3,979,000 (30 June 2007: £4,392,000, 31 December 2007: £3,721,000) and on 4,100,806 (30 June 2007: 3,793,562, 31 December 2007: 3,793,562) Ordinary Shares, being the number of Ordinary Shares in issue at the end of the period.
The basic net asset value per C Share is based on net assets (including current period revenue) of £7,905,000 (30 June 2007: £9,017,000, 31 December 2007: £7,780,000) and on 8,776,764 (30 June 2007: 8,393,209, 31 December 2007: 8,393,209) C Shares, being the number of C Shares in issue at the end of the period.
5 Reconciliation of net (deficit)/return before taxation to net cash flow from operating activities
Ordinary Share Fund
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |
| £'000 | £'000 | £'000 | |
| Net (deficit)/return before taxation | (32) | 213 | (419) |
| Net capital deficit/(return) | 51 | (189) | 478 |
| Increase in prepayments and accrued income | (6) | (11) | (17) |
| Increase/(decrease) in creditors | 27 | (26) | (15) |
| Investment management fee charged to capital | (33) | (38) | (57) |
| Less: fixed interest reinvested | (11) | - | - |
| Net cash outflow from operating activities | (4) | (51) | (30) |
C Share Fund
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |
| £'000 | £'000 | £'000 | |
| Net (deficit)/return before taxation | (214) | 406 | (745) |
| Net capital deficit/(return) | 265 | (354) | 867 |
| Increase in prepayments and accrued income | (9) | (6) | (8) |
| Increase/(decrease) in creditors | 53 | (56) | (36) |
| Investment management fee charged to capital | (69) | (77) | (115) |
| Less: fixed interest reinvested | (22) | - | - |
| Net cash inflow/(outflow) from operating activities | 4 | (87) | (37) |
Total
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |
| £'000 | £'000 | £'000 | |
| Net (deficit)/return before taxation | (246) | 619 | (1,164) |
| Net capital deficit/(return) | 316 | (543) | 1,345 |
| Increase in prepayments and accrued income | (15) | (17) | (25) |
| Increase/(decrease) in creditors | 80 | (82) | (51) |
| Investment management fee charged to capital | (102) | (115) | (172) |
| Less: fixed interest reinvested | (33) | - | - |
| Net cash outflow from operating activities | - | (138) | (67) |
6 Related party transactions
The Company's investments are managed by Calculus Capital Limited and Neptune Investment Management Limited. John Glencross, a Director of the Company has an interest in Calculus Capital Limited. The amounts paid to the Managers are disclosed below:
Ordinary Share Fund
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |
| £'000 | £'000 | £'000 | |
| Investment Management Fee | 37 | 43 | 65 |
| VAT thereon* | 7 | 8 | 11 |
| 44 | 51 | 76 |
C Share Fund
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |
| £'000 | £'000 | £'000 | |
| Investment Management Fee | 79 | 88 | 130 |
| VAT thereon* | 13 | 15 | 23 |
| 92 | 103 | 153 |
Total
| Six months to 30 June 2008 | Six months to 30 June 2007 | Year to 31 December 2007 | |
| £'000 | £'000 | £'000 | |
| Investment Management Fee | 116 | 131 | 195 |
| VAT thereon* | 20 | 23 | 34 |
| 136 | 154 | 229 |
* The current position regarding VAT charged on management fees is set out in the Chairman's Statement.
Statement of Directors' Responsibilities
The half-yearly financial report, which has not been audited or reviewed by auditors pursuant to the Auditing Practices Board Guidance on Review of Half-Yearly Financial Information is the responsibility of, and has been approved by, the Directors. The Directors confirm that to the best of their knowledge the half-yearly financial report, which has been prepared in accordance with the Disclosure and Transparency rules and in accordance with applicable accounting standards including the statement 'Half-yearly financial reports' issued by the UK Accounting Standards Board, gives a true and fair view of the assets, liabilities, financial position and the deficit of the Company as at 30 June 2008 .
The Directors confirm that the Chairman's Statement and the Investment Managers' Reviews include a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements and a description of the principal risks and uncertainties for the remaining six months of the financial year.
The Directors of Neptune-Calculus Income and Growth VCT PLC are:
Philip Stephens
John Glencross
David Kempton
David McEuen
By order of the Board
Philip Stephens
Chairman
19 August 2008
The half yearly report will shortly be posted to shareholders. Copies of the report will also be available from the company's registered office which has today been changed to 104 Park Street, London, W1K 6NF.