ProVen Plnd Ex VCT Proven Planned Exit Vct Plc : Half-yearly Report
September 26 2014 - 12:07PM
UK Regulatory
TIDMPPE
PROVEN PLANNED EXIT VCT PLC
HALF YEARLY REPORT
FOR THE SIX MONTHS ENDED 31 JULY 2014
Financial Summary
Ordinary Shares 31 July 2014 31 July 31 January
2013 2014
Net asset value per share ("NAV") 76.6p 78.1p 77.2p
Dividends paid since launch 18.0p 12.0p 15.0p
Total return (NAV plus dividends paid since 94.6p 90.1p 92.2p
launch)
Mid market share price 75.5p 82.0p 75.5p
'A' Shares 31 July 2014 31 July 31 January
2013 2014
Net asset value per share ("NAV") 0.1p 0.1p 0.1p
Dividends paid since launch - - -
Total return (NAV plus dividends paid since 0.1p 0.1p 0.1p
launch)
Mid market share price 0.1p 0.1p 0.1p
Dividend history for Ordinary Shares (since launch)
Ordinary Share dividends paid in the year / period Pence per share
3.0p
6.0p
6.0p
3.0p
31 January 2012
31 January 2013
31 January 2014
31 July 2014
Cumulative dividends paid to date 18.0p
Proposed dividend (payable 19 November 2014) 6.0p
Chairman's Statement
Introduction
I have pleasure in presenting the half year report for ProVen Planned
Exit VCT plc (the "Company") for the period to 31 July 2014.
Portfolio activity and valuation
At 31 July 2014, the Company's unquoted investment portfolio comprised
seven investments at a cost of GBP3.06 million and a valuation of
GBP3.18 million. In addition, the Company held cash of GBP0.50 million.
The investment portfolio valuation has remained unchanged since the
beginning of the financial year with the exception of Cross Solar, which
has been increased in value by GBP50,000, equivalent to 1.0p per
Ordinary Share. Following the period end, the Company's loan notes in
Blis Media were repaid at a premium leaving a small equity holding.
Results
The profit on activities after taxation was GBP118,000, comprising a
revenue gain of GBP85,000 and a capital gain of GBP33,000. The net asset
value total return, comprising net asset value and dividends paid, was
94.6p per Ordinary Share (0.1p per 'A' Share), an increase of 3.1% over
the period since 31 January 2014, after adjusting for the dividend of
3.0p per share paid on 18 June 2014.
Dividends
The Company paid a final dividend of 3.0p per Ordinary Share for the
year ending 31 January 2014 on 18 June 2014. I am pleased to announce
the payment of a further dividend of 6.0p per Ordinary Share, being an
interim dividend for the year ending 31 January 2015. The increase,
compared to last year, reflects the positive return generated by the
Company and the repayment of the Blis Media loan notes. This dividend
will be paid on 19 November 2014 to shareholders on the register as at 7
November 2014. No dividend will be payable on the 'A' Shares. This will
take the total dividends paid since inception to 24.0p per Ordinary
Share.
Share buybacks
No shares were purchased by the Company during the period. Shareholders
who are considering selling their shareholding may wish to contact the
Company's brokers, Panmure Gordon, prior to any sale. Shareholders are,
however, reminded that a disposal of VCT shares within five years from
allotment may result in the loss of the initial income tax relief given
on subscription. Shareholders should consult their financial adviser if
in any doubt about this.
Outlook
The period since the launch of your Company, in November 2010, has
coincided with a period of extremely low interest rates, quantitative
easing, generally rising stockmarkets and an economic recovery. Much
energy continues to be expended by commentators on discussing whether,
or how long, this will continue. The Investment Manager, with over 25
years of venture capital experience, is focussed on a disciplined
investment process: working with the underlying portfolio companies with
the aim of delivering stable returns to investors and a timely exit
after the completion of the five year shareholding period.
The Board welcomes feedback and comments from all shareholders and can
be contacted initially through the Investment Manager at 39 Earlham
Street London WC2H 9LT or by telephone on 020 7845 7820.
Peter LR Hewitt
Investment Manager's Report
Introduction
We have pleasure in presenting our half year investment report to 31
July 2014 for ProVen Planned Exit VCT plc (the "Company").
Portfolio performance and activity
At 31 July 2014, the Company's unquoted investment portfolio comprised
seven investments at a cost of GBP3.06 million and a valuation of
GBP3.18 million. In addition, the Company held cash of GBP0.50 million.
The Company met the qualifying targets required under the VCT
regulations during the last financial year ended 31 January 2014 and has
continued to meet them during the current financial year. No further
investments have been made during the financial year which reflects both
the intended fixed life of the Company and its relatively small size.
Cross Solar PV was revalued to reflect continued good progress and
additionally paid a dividend to the Company during the period; Long
Eaton Healthcare is valued at a small uplift on cost. The other
investments continue to be valued at their initial cost which we regard
as a positive attribute and consistent with the lower risk investment
strategy set out at the Company's launch.
Eagle-i Music's parent company, Eagle Rock Entertainment Group ("EREG"),
was sold to Universal Music Group during the period and as a result
Eagle-i Music is now a standalone company. Certain EREG shareholders
reinvested some of their sale proceeds from the sale to provide
additional capital. Good progress was made by other companies, notably
Blis Media which has secured further funding and hired new personnel to
develop its location-based marketing technologies and Cogora Group which
has expanded both its activities and customer base.
In September, Blis Media refinanced the Company's loan notes through a
new banking facility. As a result the Company has been repaid 90% of its
original investment, as well as receiving interest income, but still
shares in the potential further growth of Blis through its equity
investment.
Clearly there will be challenges ahead for some of the investments but
we are pleased with both the overall performance of the portfolio and
its potential to generate tax free returns to investors.
Outlook
The investment portfolio continues to be managed both with a view to
complying with the necessary VCT regulations and ultimately securing the
investment exits necessary to generate returns to investors. The lower
risk nature of the Company means that shareholders should not expect
large uplifts in the value of portfolio companies; similarly the
structuring of investments with loan notes with security which ranks
ahead of most, if not all, of other instruments should provide downside
protection in the event of both company specific or wider economic
events.
Beringea LLP
Summary of Investment Portfolio
as at 31 July 2014
Unrealised gain in
Cost Valuation the period % of portfolio
GBP'000 GBP'000 GBP'000 by value
Venture capital
investments
Cross Solar PV
Limited* 600 693 50 18.9%
Donatantonio Group
Limited* 550 550 - 15.0%
SPC International
Limited** 530 530 - 14.4%
Cogora Group
Limited* 500 500 - 13.6%
Long Eaton
Healthcare
Limited* 400 435 - 11.8%
Blis Media
Limited* 275 275 - 7.5%
Eagle-i Music
Limited* 200 200 - 5.4%
3,055 3,183 50 86.6%
Cash at bank and
in hand 496 13.4%
Total investments 3,679 100.0%
All venture capital investments are unquoted unless otherwise stated.
* Cross Solar PV Limited, Donatantonio Group Limited, Cogora
Group Limited, Long Eaton Healthcare Limited, Blis Media Limited and
Eagle-i Music Limited are also held by ProVen VCT plc and ProVen Growth
and Income VCT plc.
** SPC International Limited is also held by ProVen VCT plc.
Unaudited Balance Sheet
as at 31 July 2014
31 July 31 July 31 January
2014 2013 2014
GBP'000 GBP'000 GBP'000
Fixed assets
Investments 3,183 1,732 3,133
Current assets
Debtors 68 22 27
Current investments - 554 -
Cash at bank and in hand 496 1,519 622
564 2,095 649
Creditors: amounts falling due within one year (49) (58) (57)
Net current assets 515 2,037 592
Net assets 3,698 3,769 3,725
Capital and reserves
Called up Ordinary Share capital 5 5 5
Called up 'A' Share capital 7 7 7
Special distributable reserve 3,822 3,966 3,822
Capital reserve - realised (144) (108) (127)
Capital reserve - unrealised 127 32 77
Revenue reserve (119) (133) (59)
Total equity shareholders' funds 3,698 3,769 3,725
Basic and diluted net asset value per share 76.6p 78.1p 77.2p
Ordinary Share
'A' Share 0.1p 0.1p 0.1p
Unaudited Income Statement
for the six months ended 31 July 2014
Year
ended
31
Six months ended Six months ended January
31 July 2014 31 July 2013 2014
Revenue Capital Total Revenue Capital Total Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 137 50 187 45 38 83 254
Investment management fee (6) (17) (23) (8) (24) (32) (56)
Other expenses (46) - (46) (39) - (39) (86)
Return / (losses) on ordinary activities
before taxation 85 33 118 (2) 14 12 112
Tax on ordinary activities - - - - - - -
Return / (losses) attributable to equity
shareholders 85 33 118 (2) 14 12 112
Basic and diluted return per share 1.8p 0.7p 2.5p (0.1p) 0.3p 0.2p 2.3p
Ordinary Share
'A' Share - - - - - - -
Reconciliation of Movements in Shareholders' Funds
for the six months ended 31 July 2014
31 July 31 July 31 January
2014 2013 2014
GBP'000 GBP'000 GBP'000
Opening shareholders' funds 3,725 3,902 3,902
Total recognised returns for the period / year 118 12 112
Dividends paid (145) (145) (289)
Closing shareholders' funds 3,698 3,769 3,725
Unaudited Cash Flow Statement
for the six months ended 31 July 2014
Six months Six months Year
ended ended ended
31 July 31 July 31 January
2014 2013 2014
Note GBP'000 GBP'000 GBP'000
Net cash inflows from operating activities A 19 512 561
Capital expenditure
Purchase of investments - (1,050) (2,405)
Disposal of investments - 555 554
Net cash outflow from capital expenditure - (495) (1,851)
Equity dividends paid (145) (145) (289)
Management of liquid resources
Purchase of current investments held as liquidity
funds - - -
Withdrawal from liquidity funds - 449 1,003
Net cash inflows from liquid resources - 449 1,003
Net cash (outflows) / inflows before financing (126) 321 (576)
Net cash inflow from financing - - -
(Decrease) / increase in cash B (126) 321 (576)
Notes to the cash flow statement:
A Net cash flow from operating activities
Return on ordinary activities before taxation 118 12 112
Gain on investments (50) (37) (82)
(Increase) / decrease in debtors (41) 541 536
Decrease in creditors (8) (4) (5)
Net cash inflows from operating activities 19 512 561
B Analysis of net funds
Beginning of period /year 622 1,198 1,198
Net cash outflows / (inflows) (126) 321 (576)
End of period / year 496 1,519 622
Notes to the Unaudited Financial Statements
1. The unaudited half yearly results cover the six months to 31
July 2014 and have been prepared in accordance with Statement of
Recommended Practice "Financial Statements of Investment Trust Companies
and Venture Capital Trusts" revised January 2009 and in accordance with
the accounting policies set out in the statutory accounts for the year
ended 31 January 2014, which were prepared under UK Generally Accepted
Accounting Practice.
2. All revenue and capital items in the Income Statement derive
from continuing operations.
3. There are no recognised gains or losses other than those
disclosed in the Income Statement.
4. The Company has only one class of business and derives its
income from investments made in shares, securities and bank deposits.
5. The comparative figures were in respect of the year ended 31
January 2014 and the period ended 31 July 2013.
6. Basic and diluted return per Ordinary Share for the period has
been calculated on 4,818,237 shares, being the weighted average number
of shares in issue during the period.
7. Basic and diluted NAV per share for the period has been
calculated on 4,818,237 Ordinary Shares and 7,227,352 'A' Shares, being
the number of shares in issue at the period end.
8. Dividends
31 July 31 July
Pence 2014 2013 31 January 2014
per share GBP'000 GBP'000 GBP'000
Paid in the period / year:
2014 final dividend paid on 18
June 2014 3.0 145 - -
2014 interim dividend paid on 20
November 2013 3.0 - - 144
2013 final dividend paid on 24
July 2013 3.0 - 145 145
145 145 289
Dividend proposed:
2015 interim dividend payable on
19 November 2014 6.0 289 - -
9. Reserves
Special Capital Capital Revenue
reserve reserve - realised reserve - unrealised reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1
February
2014 3,822 (127) 77 (59) 3,713
Returns /
(losses)
for the
period - (17) 50 85 118
Dividends
paid in
the
period - - - (145) (145)
At 31 July
2014 3,822 (144) 127 (119) 3,686
The special reserve, capital reserve - realised and revenue reserve are
distributable reserves.
10. The unaudited financial statements set out herein do not
constitute statutory accounts within the meaning of Section 434 of the
Companies Act 2006 and have not been delivered to the Registrar of
Companies. The figures for the year ended 31 January 2014 have been
extracted from the financial statements for that period, which have been
delivered to the Registrar of Companies; the Auditor's report on those
financial statements was unqualified.
11. The Directors confirm that, to the best of their knowledge, the
half-yearly financial statements have been prepared in accordance with
the "Statement: Half-Yearly Financial Reports" issued by the UK
Accounting Standards Board and the half-yearly financial report includes
a fair review of the information required by:
a. 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 year; and
b. DTR 4.2.8R of the Disclosure and Transparency Rules, being related
party transactions that have taken place in the first six months of the
current financial year and that have materially affected the financial
position or performance of the entity during that period, and any
changes in the related party transactions described in the last annual
report that could do so.
12. Risks and uncertainties
Under the Disclosure and Transparency Directive, the Board is required
in the Company's half-yearly results, to report on the principal risks
and uncertainties facing the Company over the remainder of the financial
year.
The Board has concluded that the key risks facing the Company over the
remainder of the financial year are as follows:
(i) investment risk associated with investing in small and
immature businesses;
(ii) investment risk arising from volatile stock market conditions
and their potential effect on the value of the Company's venture capital
investments and the exit opportunity for those investments; and
(iii) failure to secure approval as a VCT.
In respect of (i) and (ii), the Board is satisfied with the Company's
approach. The Investment Manager follows a rigorous process in vetting
and careful structuring of new investments and monitors them, and the
opportunity for exit, closely after the initial investment.
In respect of (iii), the Company has been granted provisional approval
as a venture capital trust. Full approval can, as with all VCTs, only be
granted when all VCT rules have been met. This includes having at least
70% of the Company's investments in VCT qualifying investments, a target
which the Company had originally until 31 January 2014 to achieve and
which is required to be maintained on an ongoing basis. The Company's
compliance with the VCT regulations is continually monitored by the
Investment Manager, who reports regularly to the Board on the current
position. The Company also retains PricewaterhouseCoopers to provide
regular reviews and advice in this area. The Board considers that this
approach reduces the risk of a breach of the VCT regulations to a
minimal level.
13. Going concern
The Directors have reviewed the Company's financial resources at the
period end and conclude that the Company is well placed to manage its
business risks.
The Board confirms that it is satisfied that the Company has adequate
resources to continue in business for the foreseeable future. For this
reason, the Board believes that the Company continues to be a going
concern and that it is appropriate to apply the going concern basis in
preparing the financial statements.
14. Copies of the unaudited half yearly results will be sent to
shareholders. Further copies can be obtained from the Company's
registered office and will be available for download from
www.provenvcts.co.uk.
This announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: ProVen Planned Exit VCT plc via Globenewswire
HUG#1858403
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