TIDMCR5
Core VCT V PLC
From: Core VCT V PLC
Date: 25 August 2011
Half-Yearly Financial Report for the six months ended 30 June 2011
Performance Summary
Ordinary Shares 30 June 2011 30 June 2010 31 December 2010
Net asset value per share 81.29 pence 81.90 pence 89.31 pence
Total return to date per share1 88.79 pence 89.40 pence 96.81 pence
Share price (mid market) 41.50 pence 60.00 pence 50.25 pence
Earnings per share (8.01) pence (0.11) pence 7.30 pence
Cumulative dividends per share since 7.50 pence 7.50 pence 7.50 pence
inception
Expense ratio2 0.70% 0.53% 1.30%
1. Total return per share comprises closing net asset value per share plus
cumulative dividends per share paid to date.
2. Operating expenses of the Company, excluding trail commission, third party
transaction costs and costs associated with the corporate proposal, as a
percentage of closing net assets.
Chairman's Statement
Results
This report covers the six months to 30 June 2011 and does not therefore reflect
the adoption of the Proposals which was approved by shareholders at the General
Meeting held on 7 July 2011 ("the Proposals"). However, the costs associated
with this transaction have been accrued and accounted for in this period, and I
will report on this transaction later in my report.
The Net Asset Value (NAV) Total Return per Ordinary Share was 88.79p as at 30
June 2011, comprising a NAV per Ordinary Share of 81.29p and cumulative
dividends paid of 7.50p per Ordinary Share. This is a decrease from the NAV
Total Return to 31 December 2010 of 8.3%. This reduction is mainly attributable
to the interim valuation of our unquoted investments we make using IPEVC
valuation guidelines based upon most recently available financial information on
trading. Our involvement in Georgina Goodman Limited and its successor company
was provided in full at a cost of GBP254,000 and we also accrued expenses
totalling GBP88,014 in relation to the Proposals.
Investments
One new portfolio investment totalling GBP575,000 was completed during the period,
into Better at Homes Limited, Core VCT IV plc also invested GBP575,000. Further
investments were completed into two existing portfolio companies, Intercede
2387 Limited (Georgina Goodman Limited), which was subsequently provided for and
Ark Home Healthcare Limited.
The Manager's Review refers in more detail to the prospects of the investment
portfolio, which now comprises 10 unquoted investments with a cost of GBP7.2
million and a value of GBP7.7 million.
Share Price and Share Buy Backs
The Ordinary Shares (CR5) are fully listed shares. Prices are available on
www.londonstockexchange.com and are published in the Financial Times.
We would remind shareholders that we view the NAV Total Return, rather than the
share price, as the preferred measure of performance, as it encompasses the
value of the current portfolio and the amount of cash distributed to
shareholders over the life of their investment.
The Company does have the ability to buy back shares, although we are not
anticipating making any share buy backs for the foreseeable future so that we
are best placed as a Company to maximise distributions made to all shareholders.
Adoption of Proposals and Capital Dividend
At the General Meeting held on 7 July 2011 an overwhelming majority of
shareholders voted in favour of the Proposals, as outlined in the Circular,
dated 9 June 2011. From 8 July 2011, the Company now has a partnership interest
of 3.09% in Core Capital I LP. This LP, managed by Core Capital LLP, holds, Ark
Home Healthcare Limited, Brasserie Bar Co. Limited, Colway Limited, Kelway
Limited, SPL Services Limited and Core Mezz II Limited. New investors have
provided GBP27.3 million of growth capital for these investments.
As part of the Proposals, your Company received GBP1,392,000 from new investors
and a 10p interim capital dividend was paid on 12 August 2011 to shareholders on
the register on 5 August 2011.
Following completion of the Proposals, the proforma NAV is now 64.61p. This NAV
is based on the interim valuation as at 30 June 2011 mentioned above but also
takes into account the discount on transferring the assets to Core Capital I LP
and the payment of the 10p capital dividend.
Outlook
With the Proposals now completed, the focus is on managing the existing
portfolio and maximising value in order to progress an exit programme over the
next few years. Your Board's intention is to distribute the proceeds of any
realisations to shareholders, subject to maintaining adequate levels of working
capital and ensuring we retain the VCT status of the Company.
Greg Aldridge
Chairman
25 August 2011
Principal Risks and Uncertainties
The Company's assets consist of unquoted investments, cash and liquid resources.
Its principal risks are therefore market risk, credit risk and liquidity risk.
Other risks faced by the Company include economic risks, the loss of approval as
a Venture Capital Trust, failure to comply with other regulatory requirements,
and broader risks such as reputational, operational and financial risks. These
risks, and the way in which they are managed, are described in more detail in
the Annual Report for the year ended 31 December 2010, in note 18 to the
accounts. The Company's principal risks and uncertainties have not changed
materially since the date of that report and it is not envisaged that there will
be any changes to the risks and uncertainties in the remaining six months of the
financial year.
Related Party Transactions
Details of related party transactions in accordance with Disclosure and
Transparency Rule 4.2.8 can be found in Note 9 to the Accounts on page 12.
Responsibility Statement
The Directors confirm that to the best of their knowledge:
(a) the summarised set of financial statements have been prepared in accordance
with the pronouncement of interim reporting issued by the Accounting
Standards Board;
(b) the interim management report includes a fair review of the information
required by DTR 4.2.7R (indication of important events during the first six
months and description of principal risks and uncertainties for the
remaining six months of the year);
(c) the summarised set of financial statements gives a true and fair view of the
assets, liabilities and financial position and profit and loss of the
Company as required by DTR 4.2.4R; and
(d) the interim management report includes a fair review of the information
required by DTR4.2.8R (disclosure of related parties' transactions and
charges therein).
For and on behalf of the Board:
Greg Aldridge, Chairman
25 August 2011
Unaudited Income Statement
for the six months ended 30 June 2011
Notes Revenue Capital Total
GBP GBP GBP
Movement in investment holding gains 6 - (611,889) (611,889)
Net losses on sale of investments 6 - (203,125) (203,125)
Exchange differences - - -
Income 3 108,082 - 108,082
Transaction costs and investment management - - -
expenses
Other expenses (88,642) (88,014) (176,656)
Net return on ordinary activities before 19,440 (903,028) (883,588)
taxation
Tax on ordinary activities - - -
Net return attributable to equity 19,440 (903,028) (883,588)
shareholders
Return per Ordinary Share 5 0.18p (8.19)p (8.01)p
The total column of this statement is the profit and loss account of the
Company.
The supplementary revenue and capital columns are both prepared under guidance
published by the Association of Investment Companies.
There were no other gains or losses in the six months ended 30 June 2011 and
accordingly, no statement of Total Recognised Gains and Losses has been
prepared.
All revenue and capital items derive from continuing activities.
Unaudited Income Statement
for the six months ended 30 June 2010
Revenue Capital Total
GBP GBP GBP
Movement in investment holding gains - 94,963 94,963
Net losses on sale of investments - (72,094) (72,094)
Exchange differences - - -
Income 95,103 - 95,103
Transaction costs and investment management (153) (28,311) (28,464)
expenses
Other expenses (101,074) - (101,074)
Net return on ordinary activities before taxation (6,124) (5,442) (11,566)
Tax on ordinary activities - - -
Net return attributable to equity shareholders (6,124) (5,442) (11,566)
Return per Ordinary Share (0.06)p (0.05)p (0.11)p
Audited Income Statement
for the year ended 31 December 2010
Revenue Capital Total
GBP GBP GBP
Movement in investment holding gains - 874,297 874,297
Net gains on sale of investments - (3,157) (3,157)
Exchange differences - 84 84
Income 201,814 - 201,814
Transaction costs and investment management fees (305) (44,860) (45,165)
Other expenses (223,518) - (223,518)
Net return on ordinary activities before taxation (22,009) 826,364 804,355
Tax on ordinary activities 460 - 460
Net return attributable to equity shareholders (21,549) 826,364 804,815
Return per Ordinary Share (0.20)p 7.50p 7.30p
Unaudited Balance Sheet
As at As at As at
30 June 2011 30 June 2010 31 December 2010
Notes (unaudited) (unaudited) (audited)
GBP GBP GBP
Non-current assets
Investments at fair value 6 7,660,733 7,625,817 8,867,758
Current assets
Debtors and prepayments 63,302 60,604 63,778
Cash at bank 1,469,472 1,488,713 1,129,187
1,532,774 1,549,317 1,192,965
Creditors: amounts falling due (230,933) (145,353) (214,561)
within one year
Net current assets 1,301,841 1,403,964 978,404
Net assets 8,962,574 9,029,781 9,846,162
Capital and reserves
Called-up Ordinary share 7 1,102 1,102 1,102
capital
Capital reserve 7 (947,645) (876,423) (44,617)
Special distributable reserve 7 9,854,246 9,854,246 9,854,246
Revenue reserve 7 54,871 50,856 35,431
Equity shareholders' funds 8,962,574 9,029,781 9,846,162
Net asset value per 0.01p 8 81.29p 81.90p 89.31p
Ordinary Share
Unaudited Reconciliation of Movements in Shareholders' Funds
for the six months ended 30 June 2011
Six months ended Six months ended Year ended
30 June 2011 30 June 2010 31 December 2010
(unaudited) (unaudited) (audited)
GBP GBP GBP
Opening Shareholders' funds 9,846,162 9,096,471 9,096,471
Return for the period (883,588) (11,566) 804,815
Dividends paid in period - - (55,124) (55,124)
revenue
Closing Shareholders' funds 8,962,574 9,029,781 9,846,162
Unaudited Cash Flow Statement
Six months ended Six months ended Year
30 June 30 June ended
2011 2010 31 December
(unaudited) (unaudited) 2010
(audited)
GBP GBP GBP
Operating activities
Investment income received 107,238 79,211 180,615
Investment management fees paid - (2,864) (3,471)
Other cash payments (136,065) (128,383) (251,974)
Net cash outflow from operating (28,827) (52,036) (74,830)
activities
Taxation
Tax paid - - (11,596)
Capital expenditure and financial
investments
Purchase of investments (55,888) (1,506,827) (2,035,159)
Disposals of investments 425,000 1,167,451 1,370,563
Exchange differences - - 84
Net cash inflow/(outflow) from 369,112 (339,376) (664,512)
capital expenditure and financial
investment
Equity dividends paid - (55,124) (55,124)
Called up share capital received - 1,200,000 1,200,000
Net cash inflow before financing 340,285 753,464 393,938
Increase in cash 340,285 753,464 393,938
Reconciliation of net cash flow to
movement in net cash
Increase in cash 340,285 753,464 393,938
Opening cash 1,129,187 735,249 735,249
Net cash for the period 1,469,472 1,488,713 1,129,187
Reconciliation of net revenue
before taxation to net cash flow
from operating activities
Return on ordinary activities (883,588) (11,566) 804,355
before taxation
Loss on realisations of 203,125 72,094 3,157
investments
Movement in investment holdings 611,889 (94,963) (874,297)
Exchange differences - - (84)
Decrease/(increase) in debtors 476 (23,278) (26,452)
Increase in creditors 39,271 5,677 18,491
Net cash flow from operating (28,827) (52,036) (74,830)
activities
Notes:
1. The unaudited interim results have been prepared on the basis of accounting
policies set out in the statutory accounts of the Company for the year ended 31
December 2010. Unquoted investments have been valued in accordance with IPEVC
guidelines. These statements have been prepared on a going concern basis and
nothing has happened that would change the Directors' going concern assessment
from the last audited financial statements to 31 December 2010. In arriving at
this conclusion the Directors have considered the liquidity of the Company and
its ability to meet obligations as they fall due for a period of twelve months
from the date these financial statements were approved. At 30 June 2011, the
Company held cash balances of GBP1.5 million. Cashflow projections have been
reviewed and show that the Company has sufficient funds to meet its contracted
expenditure.
2. Earnings for the first six months should not be taken as a guide to the
results of the financial year to 31 December 2011.
3. Income
Six months ended Six months ended Year ended
30 June 2011 30 June 2010 31 December 2010
(unaudited) (unaudited) (audited)
GBP GBP GBP
Fixed and
variable interest - 145 145
securities
Loan stocks 105,808 93,668 197,057
Bank interest 2,274 1,290 4,612
Total income 108,082 95,103 201,814
4. Taxation
There will be no tax charge due by the Company since total expenses (including
fees allocated to capital) are expected to be more than income.
5. Earnings and return per share
Six months ended Six months ended Year ended
30 June 2011 30 June 2010 31 December 2010
(unaudited) (unaudited) (audited)
GBP GBP GBP
(i) Total return from
ordinary activities after
taxation (883,588) (11,566) 804,815
Basic return per share (8.01)p (0.11)p 7.30p
(ii) Net revenue return from
ordinary activities after
taxation 19,440 (6,124) (21,549)
Revenue return per share 0.18p (0.06)p (0.20)p
(iii) Net capital return from
ordinary activities after
taxation (903,028) (5,442) 826,364
Capital return per share (8.19)p (0.05)p 7.50p
(iv) Weighted average number
of ordinary shares in issue
in the period 11,024,969 11,024,969 11,024,969
6. Investments
Level 3 Total
GBP GBP
Valuation at 31 December 2010 8,867,758 8,867,758
Purchases at cost 56,888 56,888
Sale proceeds (448,899) (448,899)
Net losses on sale of investments (203,125) (203,125)
Investment holding losses (611,889) (611,889)
Valuation at 30 June 2011 7,660,733 7,660,733
Book cost at 30 June 2011 7,199,448 7,199,448
Investment holding gains at 30 June 2011 461,285 461,285
Valuation at 30 June 2011 7,660,733 7,660,733
The sales proceeds include defined consideration of GBP23,899 which is not
included within disposal of Investments in the Cash Flow Statement.
7. Share capital and reserves
Called-up
Ordinary
Share Special
capital Capital distributable Revenue
GBP reserve reserve reserve Total
GBP GBP GBP GBP
As at 31 December 2010 1,102 (44,617) 9,854,246 35,431 9,846,162
Net realised losses on - (203,125) - - (203,125)
investments
Movements in investment - (611,889) - - (611,889)
holding gains
Cost relating to Proposals - (88,014) - - (88,014)
Net return for the period - - - 19,440 19,440
At 30 June 2011 1,102 (947,645) 9,854,246 54,871 8,962,574
8. Net asset value
As at As at As at
30 June 2011 30 June 2010 31 December 2010
(unaudited) (unaudited) (audited)
GBP GBP GBP
Net assets 8,962,574 9,029,781 9,846,162
Number of shares in issue 11,024,969 11,024,969 11,024,969
Net asset value per share 81.29p 81.90p 89.31p
9. Related Party Transactions
Paul Richards is a member of the Manager, Core Capital LLP. Details of the
carried interest arrangements between the Company and the Manager are set out in
the Annual Report for the year ended 31 December 2010.
10. Post balance Sheet event
Since 30 June 2011, a further investment of GBP750,003 was made in Momentous
Moving Excellence Limited to fund working capital requirements. Following
shareholder approval at the General meeting held on 7 July 2011, Ark Home
Healthcare Limited, Brasserie Bar Co. Limited, Colway Limited and Core Mezz II
Limited, were transferred into Core Capital I LP, this new fund also holds
Kelway Limited and SPL Services Limited (transferred from Core VCT plc) and a
capital dividend of 10p per ordinary share was paid on 12 August 2011. The NAV,
following the transfer of assets and the payment of the capital dividend is now
64.61p.
11. The financial information for the six months ended 30 June 2011 and 30 June
2010 has neither been audited nor reviewed.
12. These are not statutory accounts in terms of Section 434 of the Companies
Act 2006. Statutory accounts for the year to 31 December 2010, which received an
unqualified audit report and did not contain a statement under sections 498(2)
or (3) of the Companies act 2006, have been lodged with the Registrar of
Companies. No statutory accounts in respect of any period after 31 December
2010 have been reported on by the Company's auditors or delivered to the
Registrar of Companies.
13. Copies of this statement are being sent to all shareholders. Further copies
are available free of charge from the Company's registered office, 103 Baker
Street, London, W1U 6LN.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Core VCT V plc via Thomson Reuters ONE
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