Final Results - Year Ended 30 September 1999

Foresight Technology VCT PLC 14 January 2000 FORESIGHT TECHNOLOGY VCT plc Preliminary Announcement of Results for the year ended 30 September 1999 Chairman's Statement It is a pleasure to present the second annual report and financial statements of Foresight Technology VCT plc for the year ended 30 September 1999. The results for the year from 1 October 1998 to 30 September 1999 are set out in the following pages and show a return (after tax) attributable to the shareholders of £129,369 (1998: £319,140). The net asset value per share at 30 September 1999 was 99.0p (1998: 94.8p). Dividend In August the Company paid an interim dividend of 1.00p net (1998: nil) per share on the basis of the results for the six months ended 31 March 1999, however the earnings per share for the full year amount to 1.17p (1998: 3.14p). This decrease in earnings arises as a result of substantial funds being transferred out of the fixed interest fund and invested in Venture Capital Investments over the year. As anticipated in our last annual report, the Board does not recommend a further dividend at this time. It is worth remembering, having regard to the Company's investment objectives, that an investment in Foresight should be considered a long term investment. Investment Position We have built upon the strong start made during the last financial year and our investment programme is proceeding successfully. As at 30 September 1999 £7,005,000 had been approved for investment or invested in ten companies, £180,000 of which had been realised. This represented approximately 69% of the Company's investments, the balance being invested in fixed interest securities and cash deposits. On 9 September 1999 Foresight realised its investment in Policy Master Group plc for a price which represented a premium of 100% on cost. On 24 November 1999 Foresight realised its holding in Bond International Software Plc for a sum marginally above the investment cost, following a profits warning announcement by that company. The Company has recently completed or approved for investment two further investments from the Ordinary Shares fund at a cost of £1,400,000 as described in more detail below. We should achieve the Venture Capital Trust qualification investment target of having at least 70% by value invested in shares and securities by 1 October 2000. It is the intention to have 80% of the Company's funds invested in UK based venture capital investments primarily in the technology sector. Several further investments are also being considered at present by your advisers, VCF Partners, and the Board. The investments held by the Company have been valued in accordance with the British Venture Capital Association guidelines under which unquoted investments are not normally revalued above cost for at least 12 months after the date of acquisition. The investments which are traded on AIM or OFEX and the fixed interest securities are carried at market value. We do, in any event, always attempt to follow a consistent and prudent valuation policy. The investments currently show an unrealised gain of £607,348 which is net of a provision of £250,000 in respect of the investment in Survey and Development Services Limited, a company which is emerging from a difficult period of trading. It is anticipated that the company's result should show an improvement for the current year. The Board is pleased with the composition of the Venture Capital Fund and is encouraged by the progress being made by a number of the companies. Net assets per share at 30 September 1999 were 99.0p (1998: 94.8p). Recent Investments - Ordinary Shares Fund In January 2000 the Company exchanged contracts to invest £1 million into The e-Exchange Limited, a company set up by an experienced international management team to build and exploit an Internet business to business commodity exchange. A further investment in Aran Software PLC of up to £400,000 has also been approved and is scheduled for completion within the next two months. Year 2000 Compliance During the period a questionnaire was sent to all our major suppliers and advisers and also to our investee companies regarding progress towards ensuring that their business critical systems would be free from malfunction at the millennium. All responses were favourable with no significant problems reported to date. New Share Offer I am pleased to report that at 31 December 1999 the Company had raised additional capital of approximately £15 million pursuant to the public offer of 'C' Shares launched in mid-October. The Offer remains open. First investment - 'C' Shares Fund An investment of £1 million was completed in January 2000 into Travelstore.com plc, an Internet travel site aiming to become the leading provider of branded online travel services for independent business travellers. I would like to thank all shareholders and warrantholders for their continued support and I look forward to welcoming you at the Annual General Meeting on 15 February 2000. Peter Dicks Chairman 14 January 2000 Statement of Total Return (incorporating the Revenue Account* for the year ended 30 September 1999) Year ended 30 September 1999 Period ended 30 September 1998 Revenue Capital Total Revenue Capital Total £ £ £ £ £ £ Net gains and losses on investments - 593,243 593,243 - 208,000 208,000 Income 437,381 - 437,381 571,681 - 571,681 Investment management fees (64,627) (193,881)(258,508) (50,845) (152,533) (203,378) Other expenses (174,030) - (174,030) (116,942) - (116,942) --------- --------- -------- --------- --------- --------- Return on ordinary activities before tax 198,724 399,362 598,086 403,894 55,467 459,361 Tax on ordinary activities (69,355) 39,746 (29,609) (84,754) 32,032 (52,722) -------- ------- -------- -------- ------ -------- Return attributable to equity shareholders 129,369 439,108 568,477 319,140 87,499 406,639 Dividends in respect of equity shares (110,295) - (110,295)(317,425) - (317,425) --------- --------- --------- ------- ------ --------- Transfer to reserves 19,074 439,108 458,182 1,715 87,499 89,214 --------- ---------- -------- ------ ------ --------- Return per Ordinary Share 1.17p 4.00p 5.17p 3.14p 0.86p 4.00p -------- -------- -------- ------ ------ --------- Notes All revenue and capital items in the above statement derive from continuing operations. The Company has only one class of business and derives its income from investments made in shares, securities, loans and bank deposits. Comparative figures are for the period from incorporation on 19 August 1997 to 30 September 1998. * The revenue column of this statement is the profit and loss account of the Company. Balance Sheet as at 30 September 1999 1999 1998 £ £ £ £ Fixed Assets Investments 10,036,805 1,737,999 Monies held on deposit pending investment 719,032 8,936,087 ---------- ---------- 10,755,837 10,674,086 Current assets Debtors and prepayments 315,873 168,251 Cash at bank 31,937 16,077 ------- ------- 347,810 184,328 Creditors: amounts falling due within one year (102,993) (480,242) --------- --------- Net current assets/(liabilities) 244,817 (295,914) ---------- ---------- Net assets 11,000,654 10,378,172 ---------- ---------- Capital and reserves Called up share capital 111,085 109,457 Share premium account 10,342,173 10,179,501 Capital reserve 526,607 87,499 Revenue reserve 20,789 1,715 ---------- ---------- Equity shareholders' funds 11,000,654 10,378,172 ---------- ---------- Net asset value per Ordinary Share for Ordinary Shares of 1p each 99.0p 94.8p ----------- ---------- Cashflow Statement for the year ended 30 September 1999 Year ended Period ended 30 September 1999 30 September 1998 £ £ £ £ Operating activities Dividends received 1,200 - Deposit and similar interest - non-qualifying 264,909 560,111 Investment management fees paid (259,131) (261,856) Other cash payments (159,833) (105,050) --------- --------- Net cash (outflow)/inflow from operating activities (152,855) 193,205 Servicing of finance Net dividends paid (427,720) - Taxation ACT paid (79,357) - Investing activities Purchase of fixed income investments (9,099,950) - Purchase of other investments (4,975,758) (1,529,999) Sale of fixed income investments 6,010,145 - Sale of other investments 360,000 - ---------- ----------- Net cash outflow investing activities (7,705,563) (1,529,999) ----------- ----------- Net cash outflow before financing and liquid resource management (8,365,495) (1,336,794) Management of liquid resources Movement in money market and other deposits 8,217,055 (8,936,087) Financing Issue redeemable non-voting shares - 12,500 Issue of ordinary shares 177,800 10,945,700 Redemption of non-voting shares - (12,500) Share issue expenses - (656,742) Purchase of own shares (13,500) - --------- ----------- 164,300 10,288,958 -------- ---------- Increase in cash 15,860 16,077 -------- ---------- PRELIMINARY ANNOUNCEMENT OF RESULTS NOTES TO THE STATEMENTS (for the year ended 30 September 1998) 1. Return per Ordinary Share The revenue return per Ordinary Share is based on the net revenue from ordinary activities after taxation of £129,369 (1998: £319,140) and 10,987,541 (1998: 10,153,357) Ordinary Shares, being the weighted average number of Ordinary Shares in issue during the period. The capital return per Ordinary Share is based on net realised and unrealised capital gains of £439,108 (1998: £87,499) and on 10,987,541 Ordinary Shares (1998: 10,153,357). No tax arises on capital gains made by the Company. 2. In accordance with the policy statement published under 'Management and Administration' in the Company's prospectus dated 1 October 1997, the Directors have charged 75% of the investment management expenses to the capital reserve. 3. An interim dividend of 1.0p per ordinary share was paid on 6 August 1999 (1998: Nil pence). No final dividend is proposed by the Directors for the year ended 30 September 1999 (1998: 2.90p). 4. The financial information set out in these statements does not constitute the Company's statutory accounts for the year ended 30 September 1999 or period ended 30 September 1998 but is derived from those accounts. Statutory accounts for the year ended 30 September 1999 will be delivered to the Registrar of Companies following the Company's Annual General Meeting. The auditors have reported on those accounts: their reports were unqualified and did not contain statements under Section 237 (2) or (3) of the Companies Act 1985. 5. The Annual Report will be circulated by post to all shareholders on 18 January 2000 and copies will be available thereafter to members of the public from the Company's registered office at St Philips House, St Philips Place, Birmingham B3 2PP. 6. The Annual General Meeting will be held at 10.00am on 15 February 2000 at the Company's registered office. R W Blears Company Secretary Contacts: Peter Dicks, Chairman Tel: 0207 224 5354 Andrew Waterworth Financial Dynamics Tel: 0207 831 3113

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