Triple Point Ve Regulatory News (TPV)

24 October 2023

Triple Point Venture VCT Plc

(the "Company")

RESULTS FOR THE SIX MONTHS ENDED 31 AUGUST 2023

The Directors of Triple Point Venture VCT plc are pleased to announce the unaudited results for the six months ended 31 August 2023.

You may view the Interim Report in due course on the Triple Point website: www.triplepoint.co.uk. Please note that page numbers in this announcement are in reference to the Interim Report.

FOR FURTHER INFORMATION ON THE COMPANY, PLEASE CONTACT

The Company's LEI is 213800AOOAQA5XQDEA89

Further information on the Company can be found on its website 

https://www.triplepoint.co.uk/current-vcts/triple-point-venture-vct-plc/s2539/

NOTES:

The Company is a Venture Capital Trust incorporated in July 2010 and was established to fund small and medium sized enterprises. The Investment Manager is Triple Point Investment Management LLP.

Financial Summary

1 Total Return is made up from the current Net Asset Value plus Dividends paid to date. Total Return is defined as an Alternative Performance Measure ("APM"). Total Return, calculated by reference to the cumulative dividends paid plus net asset value (excluding tax reliefs received by Shareholders), is the primary measure of performance in the VCT industry.

Triple Point Venture VCT plc ("the Company") is a Venture Capital Trust ("VCT"). The Investment Manager is Triple Point Investment Management LLP ("TPIM" and "Triple Point"). The Company was incorporated in July 2010.

· Venture Shares: On 29 July 2023 the fourth Venture Share Class offer closed having raised gross proceeds of £14.97 million with a total of 14,205,221 Venture Shares being issued. This takes gross proceeds raised to date to £57.48 million and 54,243,600 Venture Shares have now been issued.

· A Ordinary Shares ("A Shares"): As at the date of this report, the A Ordinary Shares have been cancelled and are no longer in existence. The A Share Class was wound up earlier during the period (further information is below).

· B Ordinary Shares ("B Shares"): As at the date of this report, the B Ordinary Shares have been cancelled and are no longer in existence. The B Share Class was wound up earlier during the period (further information is below).

Key Highlights

· Venture Shares Cumulative Dividends Paid: 9.00p (Nil Venture dividends paid during the period3).

· Net Asset Value per Venture Share: 99.61p (Period ended 28 February 2023: 102.17p).

· Total Return per Venture Share2: 108.61p (Total Return for the Venture Share Class includes cumulative dividends paid of 9 pence per Venture share3).

· Fundraising: £14.97m (into the Venture Share Class offer which closed on 29 July 2023).

· Ongoing Charges Ratio: 3% (The ongoing charges ratio is a ratio of annualised ongoing charges expressed as a percentage of average net asset values throughout the period (2023: 3.21%)).

 2Total Return is made up from the current Net Asset Value plus Dividends paid to date. Total Return is defined as an Alternative Performance Measure ("APM"). Total Return, calculated by reference to the cumulative dividends paid plus net asset value (excluding tax reliefs received by Shareholders), is the primary measure of performance in the VCT industry.

  3A dividend of 2p per share was paid to Shareholders following the period end on 4 September 2023.

Chair's Statement

I am writing to present the Interim Report for the Company for the period ended 31 August 2023.

The Company now has a single share class investing in early-stage venture opportunities. The portfolio has continued to grow through the period, having made five new qualifying investments and eight follow-on investments, at a total value of of £7.18 million. Further information on the Company's investment portfolio can be found below and in the Investment Manager's Review on pages 12 to 19. During the period, the Company's name was changed to Triple Point Venture VCT Plc, following shareholders approval at the Company's Annual General Meeting held on 19 July 2023.

Offer for Subscription of Venture Shares

The recent Offer for Subscription of Venture Shares closed on 29 July 2023. The Board are pleased to announce that the offer raised £14.97 million and resulted in the issuance of 14,205,221 new Venture Shares. On behalf of the Board, I would like to welcome all new Shareholders and to thank the existing Shareholders for their continued support.

The Board and the Investment Manager believe that the level of Venture investment opportunity in our chosen sectors continues to be promising. The Company has announced that it is seeking to raise a further £10 million (with a £20 million over-allotment facility), to continue investing in early-stage businesses with strong, long-term growth potential. The offer for subscription opened on 22 September 2023 and will close on 31 July 2024 or earlier if fully subscribed.

Venture Shares

The Company's funds at 31 August 2023 were 70% deployed in a portfolio of VCT qualifying and non-qualifying unquoted investments. It continues to meet comfortably the condition that 80% of new funds raised must be invested into qualifying investments by the year-end of the period two years after the funds are allotted.

Since inception, £35.9 million has been deployed into 48 qualifying growth companies, making a meaningful impact to support innovation and employment in the wider UK economy. In the last year, jobs within our portfolio companies has risen from 1,200 to 1,400.  We have judiciously continued to support a number of our existing portfolio companies with follow-on funding during the period; the Company has now provided almost £9.5m in follow-on funding to 19 portfolio companies.

There were thirteen investments made in the half-year period under review including five new investments and eight follow-on investments into existing portfolio companies, reflecting the maturing of our earlier cohorts of investments. While all these investments involved software services or platforms, the sub-sectors that we have backed range across FinTech, Digital Health, HR Tech, Hospitality and Data Analytics.

While we do not separate out Artificial Intelligence ("AI") as a distinct sector, within the portfolio there are a number of companies, such as Channel, where AI is intrinsic to the software that they offer to their customers, but there are far more investee companies, such as Aptem and Nory, where AI is being used to enhance efficiencies and information around their existing core products.

More detail on these investments can be found in the Investment Manager's Review on pages 12 to 19.

In the six month period to 31 August 2023, a loss of 2.71 pence per share was recorded. We are pleased to report that 5 portfolio companies successfully achieved higher valuations when raising additional funding during the period, reflecting their continued revenue growth or product development achievements. At the same time, however, there have been several unrealised fair valuation reductions made during the period in light of the continuing challenging global macro and fund-raising environments for early-stage businesses and, of course, individual portfolio companies' commercial performance. Despite the significant recovery in large, listed technology share prices this calendar year, valuations of venture-backed start-ups remained under pressure except in certain niche sectors such as Artificial Intelligence which attracted considerable investor excitement.

The rising interest rates and bond yields since early 2022 had a direct impact on the start-up ecosystem in March 2023 when they contributed to the collapse of Silicon Valley Bank ("SVB") a crucial provider of loans to start ups in the UK as well as the USA. While a number of our portfolio companies held accounts with SVB UK, the prompt acquisition of SVB's UK business by HSBC meant there was no impact on our investees access to liquidity. The Investment Manager worked with a number of portfolio businesses to add diversification to their banking relationships. There was also very limited further impact from SVB on the broader macro environment, with the UK economy remaining sluggish (but so far avoiding technical recession). While inflationary pressures have eased slightly in the period, short term interest rates continued their rise in the UK, US and EU suggesting that the economic backdrop will remain challenging for a little longer.

Macro stories have been a big theme during the early years of the Venture Portfolio yet, in the long run, what will matter most for our returns to investors are the bottom-up fundamentals of our portfolio companies and how succesful they can be in carving out innovative new business niches for themselves. Since its launch in September 2018, we have been pleased to see the Venture portfolio demonstrate resilience despite being buffeted by a wide variety of external factors such as higher interest rates, the Russia-Ukraine invasion and the energy inflation shock, lower tech sector valuation multiples and, before that, the Covid-19 lockdowns.

Funding has remained available for good businesses, but the more demanding external environment has prompted start-up founders and their investors to focus on value-for-money rather than the growth-at-any-price approach of 2021. 

As we have said before, a period of adversity can represent a period of opportunity for investors. We remain of this view and Triple Point report that they continue to see a good flow of new opportunities for seed stage investment, while the existing portfolio remains well positioned for future growth. The Investment Manager has deployed all the funds raised from offers prior to 2022 in a timely manner and has successfully deployed 69% of the funds raised in the 2022 Offer into Qualifying Investments to date, comfortably exceeding the 30% investment requirement.

Both the Board and the Investment Manager believe ESG considerations are important, and they are taken into account through the Company's investment process. Whilst early-stage companies do not always have the scale or resources to adopt the full scale of ESG initiatives open to large corporates, we always check the processes and policies they do have in place to ensure that they are proportionate to their size and activities.

Wind down and Cancellation of the A and B Share Classes

The period under review included the wind down and cancellation of the A and B Share Classes, as approved by Shareholders at the Company's general meeting held on 9 February 2023 and the A and B Share Class meetings held on 1 March 2023. The cancellations were effective on 30 March 2023, and all funds including nominal capital, have now been returned to the A and B Share Class Shareholders.

From 12 September 2023, the Investment Manager was appointed as the Company's Alternative Investment Fund Manager ("AIFM") and is now responsible for risk management and portfolio management. Therefore, the Investment Manager has full discretion under the Investment Management Agreement to make investments in accordance with the Company's Investment Policy from time to time. In addition, the Company has appointed a depositary4 Indos Financial Limited, and their details can be found on page 37. There are no changes to Triple Point's fees as a result of their appointment as AIFM. Further details can be found in Note 6.

4 Following TPIM's appointment as AIFM and as required under the Alternative Investment Fund Management Directive, the Company has appointed a depositary which is an independent third party that is responsible for the safekeeping of assets of the Company, performing the cash flow monitoring and the oversight duties of the Company.

Outlook

The mediocre macro environment seems likely to continue for the time being. What is less certain is when core inflation will come down to central bank targets catalysing expectations for lower interest rates and an easing in the venture funding market and improvement in valuations. The Investment Manager continues to monitor portfolio developments carefully, particularly regarding investee liquidity, given the currently more challenging fund raising environment.

Regardless, we expect that the cost-effective software solutions which our portfolio specialises in are likely to remain in demand, leaving the existing portfolio well positioned for future growth.

The Board will continue to consider dividends for Venture Shareholders, subject to realised profits, legal requirements and liquidity. I am delighted to report that a dividend of 2 pence per share was paid to Shareholders on 4 September 2023 bringing total dividends paid to 11 pence. The Board expects that a further dividend will be paid later in the financial year.

The Company has recently announced the launch of an offer for subscription of new Venture Shares, for subscription in the 2023/2024 and 2024/2025 tax years. To thank our supporters, existing Shareholders will be eligible to receive a loyalty bonus of a 1% reduction in the costs of the Offer for applications received over the offer period. More information can be found in the Prospectus issued on 22 September 2023 on the Triple Point website www.triplepoint.co.uk.

As referred to in the Company's latest annual report, investors should remain aware that NAV volatility may remain high and will be impacted by trends in global venture capital valuations as well as the portfolio companies' underlying commercial performance.

We have a full pipeline of new investments for the next six months including three investments that are in the process of deal execution. The new fundraise will allow the Company to continue to support its existing portfolio of investments, as well as to pursue new investment opportunities as they are identified. The Company will continue to target significant capital growth by investing in early-stage innovative companies with a particular focus on the business-to-business ("B2B") technology sector, and we remain excited about the opportunities ahead.

If you have any questions about your investment, please do not hesitate to contact Triple Point on 020 7201 8990.

Jane Owen

Chair

23 October 2023

Investment Manager's Review

Sector Analysis

During the period there have been changes to the Unquoted Investment Portfolio. The Company has made investments into five new companies, examples of which can be seen on page 14 of the Investment Manager's Review. There were also eight follow-on deployments into existing portfolio companies.

The sector composition of the Unquoted Investment Portfolio can be broken down as follows:

Investment Portfolio

Venture Share Class

We have the pleasure in presenting our interim review for the six months ended 31 August 2023.

Review & Future Developments

With the Bank of England having raised interest rates 14 times in a row to a 15-year high and other major central banks on a similar path, the fundraising environment has become gradually more testing for many start-up founders and CEOs as many venture funds have been deploying capital at a slower rate and non-venture specialist funds have reduced their participation in the sector. That has had an impact on the valuation as well as the availability of capital for some start-ups. We have started to see a few more down-rounds, where founders and investors accept that, in order to raise further funds, valuations set for the new funds may be lower than 2020-21 levels.

This has in some senses presented us with an opportunity: there is no shortage of companies with innovative business ideas seeking funds and some areas of the venture funding market have become less competitive offering us the possibility of investing the VCT's funds in growth areas at somewhat more compelling valuations than previously. Thus, we continue to see a healthy pipeline of potential investment opportunities.  On the other hand, some of our existing portfolio companies have decided to delay fundraising over the last year or so, and stretched their cash runway by reducing costs, or at least reducing the growth of costs. We are also willing financial supporters of existing portfolio companies that have demonstrated that they can grow revenues significantly while maintaining cost discipline in these more straitened times.

Venture Shares

The Venture Share Class was initially launched in September 2018 and has raised gross proceeds of £57.5m to date.

The Investment Manager's Venture team began investing in the Venture portfolio in April 2019 and as at 31 August 2023 has completed 48 unique investments in predominantly B2B technology firms serving sectors spanning across Fintech, Healthcare, Logistics, HR Tech, Middleware, Insure-tech, Proptech, Cyber Security, Education, Telecommunications and Content & Design.  

In the six months to 31 August 2023 the team has invested a total of £7.2m. This includes five new investments (Modo Energy, Virtual Science, Fertifa, Nory and Statement) and eight follow-on investments (Trumpet, Scan.com, Channel, Kamma, Knok, Konfir, Semble, and SonicJobs). More information about these companies can be found below. Follow-on investments, when compared to investments in new companies, have increased in this period from 26% to 44% of total investments made. This increase is a function of the VCT's maturing portfolio given that venture-backed businesses typically raise new funds every 18-24 months or so.

£35.9 million of capital has been deployed to date, in both qualifying and non-qualifying investments.

We note one exit over the period of Localz, which was acquired by Descartes Systems Group in April. Despite having a strong team, Localz growth had stalled somewhat and the best thing for the business and its investors was to introduce a well-capitalised business partner in Descartes, despite the exit valuation delivering a small loss for the VCT. 

Overall, the portfolio has continued to make good commercial progress during the period. Revenue across the portfolio continues to grow, with approximately 40% of the companies in the portfolio last year growing revenues by over 100% year-on-year. We are also pleased to report that despite the more demanding fundraising environment, many of our portfolio companies continue to attract new investment from third-party investors. Several portfolio companies successfully raised additional funding at a higher valuation, showing real quality in the underlying portfolio.

During the period, there have been a number of portfolio companies which have not met our expectations. We have therefore reduced the fair value of investments where we believe that growth rates are not sufficient to offset market valuation declines or the risks associated with reduced cash runway for individual companies. In relation to some portfolio companies, which benefitted from the very positive valuation climate for fundraising completed in 2021, we have continued to maintain varying fair-value downward adjustments which we have now held for some time and review regularly.

Beyond the Company's venture investments, a majority of the VCT's liquid funds awaiting deployment have been invested in money market funds and a corporate bond fund. In today's higher interest rate environment this improves the return on the Company's cash (relative to bank deposits) whilst complying with VCT rules on sources of income. 

Investments during the period:

As mentioned above, during the period, the Company has made five new qualifying investments and eight follow-on investments. Their businesses are described briefly below:

New investments

Modo Energy: Modo have created a complete and popular platform for market and asset performance data regarding energy storage assets such as industrial-scale batteries.

Fertifa: Fertifa's platform helps employers to provide services to employees around i) fertility & family forming; ii) menopause; and iii) men's reproductive health.

Nory: Nory provides AI-enabled software for hospitality businesses to manage their business and restaurant operations. The product currently has 3 core components: automated workforce management, inventory management and performance insights & predictive forecasting.

Statement: Statement is a new SME payment provider switching service, being built to capitalise on the fact that overcharging of small business by card payment processing providers is very common.

Virtual Science: Virtual Science enables international pharmaceutical companies to roll out hybrid advisory boards across the world and analyse video and text feedback for insights in days - rather than weeks with medical writers. 

Follow-on investments in existing portfolio companies

Scan.com: Scan.com are building the infrastructure layer to connect the global diagnostic imaging market, aiming to solve the lack of price transparency for imaging, long waiting lists and reliance on archaic workflows. The company's monthly B2B scan volume has grown over 22 times year-on-year to 335.

Trumpet: Trumpet is building a platform to transform the entire B2B sales process from pitch to onboarding. Trumpet's platform enables sales organisations to easily create online sales microsites or "Pods" personalised to each customer.

Channel: Channel is a next-generation Business Intelligence tool to enable anybody within an organisation to make data queries of specialist software which usually requires some coding skills. This is enabled by using the generative powers of large language models.

Kamma: Kamma is a data company with an engine that processes geospatial and regulatory data. The engine maps properties by address, provides on demand regulatory data relating to an address, and visually overlays data on properties, to help assess the wider regulatory risk associated with an individual property or portfolio.

Knok Health: Knok is a telemedicine solution for virtual consultations that provides a combination of triage, scheduling, record keeping, and integration with healthcare providers. Knok Healthcare's product, Panacea, aims to be the reference white label provider for virtual consultations.

Konfir: Konfir is an Application Programming Interface ("API") led verification platform that enables instant employment history and prior income checks. Konfir provides fast, safe and cost-effective access to employment and income data available through integrations with payroll APIs, direct relationships with payroll / payment providers and Open Banking technology. 

Semble: Semble is a cloud-based clinic management system, which helps healthcare practices manage all aspects of their administration in one place. Their software allows medical practices to manage patient data and electronic health records, manage their appointments and other practise management functions. Having grown rapidly in the UK, Semble are expanding into France.

SonicJobs: SonicJobs is an app-based job search platform specialising in roles in blue collar industries including hospitality, retail, beauty, logistics, health and social care. SonicJobs differentiates itself from other job sites by the ease with which a candidate can apply for a role via their platform.

Company Spotlight: Modo Energy

Modo Energy

Battery storage technology helps by making the energy grid more stable, increasing the usage of renewable energy sources, handling periods of high energy demand, offering backup power during emergencies, and lowering carbon emissions.

The Team

Based in Birmingham, Modo Energy was founded in 2019 with a simple mission: "to transform the energy industry through transparency of data". Modo's leadership team has strong expertise in this sector. CEO Quentin Scrimshire was previously Head of Energy Storage at Kiwi Power. Before this, he spent four years as an Engineer at Centrica, where he worked on battery energy storage projects. Tim Overton, Modo's Chief Operating Officer previously spent six years as an engineer with Fichtner, an energy engineering consultancy.

The Product

Modo gathers independent data from more than 15 separate sources to provide companies with focused and actionable insights on energy markets and energy asset performance, helping to accelerate the renewable shift in energy grids. Modo's databases have multiple uses, including within financial reporting, for insurance claims within the energy sector, helping asset managers to assess potential acquisitions, energy market forecasting, and educating company staff around energy markets.

The Market

Due to the rising demand for cleaner energy sources as countries across the world attempt to achieve net zero carbon emissions, the global market for battery storage is predicted to reach around $16 billion by 20304. With an estimated 30x more energy storage needed to meet decarbonisation goals, Modo is well positioned within its market.

Outlook 

We are continuing to gradually expand the portfolio based on three core beliefs at the heart of the investment strategy for the Company:

· It pays to invest early - the Company typically invests at Seed-stage investment rounds when a company's annual revenues are usually under £1m per annum and at which point the company's valuation is relatively low. This increases the potential return when compared with investing in more mature companies whose investment risk may be lower but business valuations higher. 

· Focusing on business-to-business ("B2B") companies; allows us to have thorough due diligence conversations with the existing (or prospective) customers of potential new investees, and our research suggests there are far more successful exits of B2B companies than consumer focused companies.

· Diversification is key to reduce risk. The Company combines diversification in three main areas: diversifying across 48 (and growing) individual portfolio companies; sector diversification - we invest in portfolio companies across several different business sectors within the B2B theme; company age diversification - earlier "vintages" of investee companies mature over time and mix with newer investments so that the portfolio covers various stages of the venture lifecycle. 

Despite economic growth forecasts remaining modest and interest rates likely to remain high over the next year, we have a healthy pipeline of new and follow-on investment opportunities for the Company on which we are currently performing due diligence. As we write there are three investments that are in the process of deal execution.

As mentioned in the Chair's Statement on pages 7 to 10, we recently launched a new offer for subscription on 22 September 2023, which will allow us to continue to support our portfolio companies, as well as to pursue new investment opportunities as they arise and leverage some of the fixed cost base of the Company.

If you have any questions, please do not hesitate to call us on 020 7201 8990.

Ian McLennan

Partner

For Triple Point Investment Management LLP

23 October 2023

Investment Portfolio Summary

For the six months ended 31 August 2023

Principal Risks and Uncertainties

The Directors seek to mitigate its principal risks by regularly reviewing performance and monitoring progress and compliance. In the mitigation and management of these risks, the Directors carry out a robust assessment of the Company's emerging and principal risks, including those that would threaten its business model, future performance, solvency or liquidity and reputation.

The main areas of risk identified by them, along with the risks to which the Company is exposed through its operational and investing activities, are detailed below.

VCT Qualifying Status Risk The Company is always required to observe the conditions laid down in the Income Tax Act 2007 for the maintenance of approved VCT status. The loss of such approval could lead to the Company losing its exemption from corporation tax on capital gains, to investors being liable to pay income tax on dividends received from the Company and, in certain circumstances, to investors being required to repay the initial income tax relief on their investment. 

Mitigation: The Investment Manager keeps the Company's VCT qualifying status under continual review and reports to the Board at Board Meetings. The Board has appointed Philip Hare & Associates LLP to undertake an independent VCT status monitoring role. Any new Venture investments are reviewed by legal advisers, and their opinion sought on whether the investment is likely to be a qualifying investment.

Investment Risk the Company's VCT qualifying investments will be held in small and medium-sized unquoted companies which, by their nature, entail a higher level of risk and lower liquidity than investments in large, quoted companies. This could make it difficult to realise investments in line with the relevant strategy.

Mitigation: The Directors and Investment Manager aim to limit the risk attached to the portfolio by careful selection and timely realisation of investments, by carrying out rigorous due diligence procedures and by maintaining a spread of holdings in terms of industry sector and geographical location. The Board reviews the investment portfolio with the Investment Manager on a regular basis. Where possible, a member of the Investment Manager team holds a seat on the board of the portfolio companies. This enables the Investment Manager to observe and offer guidance to the portfolio company when and where this may be required. TPIM has developed a wide industry network and strong pipeline which is reviewed quarterly by the Board. The Company aims to mitigate some of the risks typically associated with venture capital investing by proactively working with businesses with the potential for high growth that are actively solving problems for established corporates, increasing their chances of success.

Financial Risk as a VCT the Company is exposed to market price risk, credit risk, fair value risk, liquidity risk, inflation risk and interest rate risk. As most of the Company's investments will involve a medium to long-term commitment and will be relatively illiquid, the Directors consider that it is inappropriate to finance the Company's activities through borrowing, other than for short-term liquidity.

Mitigation: The key elements of financial risk are discussed in more detail in the 2023 Annual Report available at https://www.triplepoint.co.uk/current-vcts/triple-point-venture-vct-plc/s2539/. At the reporting date, the Company had no borrowings and substantial cash on the balance sheet.

Failure of Internal Controls Risk Controls designed to ensure that the Company's assets are safeguarded and that proper accounting records are maintained.

Mitigation: The Board regularly reviews the system of internal controls, both financial and non-financial, operated by the Company and its Manager.

Emerging Risks

Climate Change and Related Legislation Triple Point as Investment Manager is committed to sound management of climate risk and opportunity, to ensure the long-term protection of asset value through reduction of exposure to the risk and also to contribute to essential carbon reduction requirements. The Investment Manager is in the process of setting Net Zero targets across its entire portfolio, which will cover the Company's assets. The intention is to follow the most up to date guidance from the Science Based Targets Initiative ("SBTi"). . Climate Change or related legislation is considered unlikely to have a major near-term impact on the Company, as the vast majority of the portfolio is made up of a diversified range of software-based businesses.

Each prospective new company holding is considered with regard to how it may be impacted by climate change and how this could in turn affect future growth. Where appropriate the team may also access a specialist physical climate risk assessment tool to determine possible climate risk mitigation requirements prior to investment.

Economic Conditions A further deterioration in macroeconomic conditions, such as such as a severe recession, encompassing slow growth, high unemployment and rising inflation ("stagflation"),could have both a direct and indirect impact on existing portfolio companies, particularly in

the event that investor risk appetite declines, as this would make it harder to secure new venture funds or other capital, which is often necessary for their continued long-term operations.

This could impact investee companies' performance and valuation metrics, ability to raise new funds (and the valuation of such raises), and ability to grow. Any sustained deterioration of trust, liquidity or capital in the banking sector could have a material impact on existing portfolio companies given their reliance on existing cash reserves to fund regular outgoings. The Company is monitoring closely to evaluate the impact on both the Company and the investee companies.

Directors' Responsibility Statement

The Directors have prepared the Interim Report for the Company in accordance with International Financial Reporting Standards ("IFRS").

In preparing the Interim Report for the six month period to 31 August 2023, the Directors confirm that to the best of their knowledge this condensed set of financial statements has been prepared in accordance with the UK adopted International Accounting Standard 34 "Interim Financial Reporting" and that the Chair's Statement on pages 7 to 10 includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8 of the Disclosure and Transparency rules of the United Kingdom's Financial Conduct Authority namely:

a) the Interim Financial Report includes a fair review of important events during the period and their effect on the Financial Statements and a description of specific risks and uncertainties for the remainder of the accounting period;

b) the Interim Financial Report gives a true and fair view in accordance with IFRS of the assets, liabilities, financial position and of the results of the Company for the period and complies with IFRS and the Companies Act 2006; 

c) the Interim Financial Report includes a fair review of related party transactions and changes therein. There were no related party transactions for the accounting period, as defined in International Accounting Standards; and

d) the Directors believe that the Company has sufficient financial resources to manage its business risks in the current uncertain economic outlook.

This Interim Financial Report has not been audited or reviewed by the auditors.

Jane Owen

Chair

23 October 2023

Unaudited Statement of Comprehensive Income

For the six months ended 31 August 2023

The total column of this statement is the Statement of Comprehensive Income of the Company prepared in accordance with International Financial Reporting Standards ("IFRS"). The supplementary revenue return and capital columns have been prepared in accordance with the Association of Investment Companies Statement of Recommended Practice ("AIC SORP"). All revenue and capital items in the above statement derive from continuing operations. This Statement of Comprehensive Income includes all recognised gains and losses. The accompanying notes are an integral part of this statemet

Unaudited Balance Sheet

At 31 August 2023

Company No: 07324448

The statements were approved by the Directors and authorised for issue on 23 October 2023 and are signed on their behalf by:

Jane Owen

Chair

23 October 2023

The accompanying notes are an integral part of this statement.

Unaudited Statement of Changes in Shareholders' Equity

For the six months ended 31 August 2023

The capital reserve represents the proportion of Investment Management fees charged against capital and realised/unrealised gains or losses on the disposal/revaluation of investments. The unrealised capital reserve is not distributable. The special distributable reserve was created on court cancellation of the share premium account. The revenue reserve, realised capital reserve and special distributable reserve under company law are distributable by way of dividend.

At 31 August 2023 the total reserves available for distribution under the Companies Act are £34,186,000 (28 February 2023: £35,273,000). This consists of the special distributable reserve less the realised capital loss and less the revenue loss.

At 31 August 2023 the total reserves available for distribution under the VCT rules are £3,388,143 (28 February 2023: £3,560,976). To maintain VCT status, amounts in the special distributable reserve are not distributable until after the 3rd accounting period following the relevant allotments of Share capital.

Unaudited Statement of Cash Flows

For the six months ended 31 August 2023