Annual Financial Report

RNS Number : 5232B

Maven Income & Growth VCT 4 PLC

17 April 2012

 



Maven Income and Growth VCT 4 PLC

Annual Financial Report for the year ended 31 December 2011

Despite continued volatility for global quoted markets throughout the reporting period, and the resulting adverse impact on UK business and investor sentiment, the Board is pleased to report that your Company has achieved further positive shareholder returns during the year to 31 December 2011. Smaller companies are exposed to the wider market fragility, but your Company's private equity portfolio continues to perform well and in line with the Company's objective of generating long term capital appreciation and maintainable levels of tax-free income for shareholders.

The Manager seeks to invest in a wide range of attractively priced later-stage companies with defensive characteristics, predictable earnings and modest levels of debt, which are therefore well placed to withstand extended periods of challenging trading conditions.  This approach has helped to deliver an increasing level of tax-free dividends for shareholders and steady growth in the underlying NAV.  Your Board was encouraged to note that a recent AIC press release entitled 'VCT performance rivals conventional companies in 2011', which analysed the high representation of VCTs among the top performing investment companies during 2011, highlighted the fact that your Company was ranked 2nd of the top ten VCTs for share price total return during that period and was also showing strong  positive returns over 3 years.

The Manager's ability to source high quality private company holdings was confirmed in the Deloitte Buyout Track 100 report published in February 2012, which tracks the performance of the top 100 private equity backed medium-sized companies in Britain over the past two years. Four portfolio companies feature in this report, which provides useful independent validation of the underlying quality of the assets held by your Company.

Performance

•     Total return on Ordinary shares of 118.5p per share (2010: 112.0p) at 31 December 2011, up 5.8% over the year and 24.7% since launch.

•     Net asset value (NAV) of Ordinary shares at the year end of 98.2p per share (2010: 95.7p).

•     Total return on S Shares of 112.65p per share (2010: 103.85p) at 31 December 2011, up 8.5% over the year and 18.6% since launch.

•     NAV of S Shares at the year end of 104.1p per share (2010: 97.3p).

•     Five new later stage, yielding investments added during the year.

•     Disposal of Walker Technical Resources, for a return of 3.0 times cost.

•     Final dividends proposed of 2.5p per Ordinary Share (2010: 2.5p) and 1.3p per S Share (2010: 0.5p).

•     A total of 4.0p declared per Ordinary share and 2.8p per S Share in respect of the year (2010: 3.5p and 1.5p respectively).

The most important measure of performance for a VCT is the total return, which is the long term record of dividend payments out of income and capital gains combined with the current NAV. The NAV in isolation is a less relevant measure of performance as the underlying investments are long-term in nature and not readily realisable.

Dividends

The Board is proposing a final dividend of 2.5p per Ordinary share and 1.3p per S share to be paid on 30 May 2012 to shareholders on the register on 9 May 2012. Including the interim dividends paid in September 2011, the tax-free yield for the year is 6.7% on the net cost (taking into account the initial tax relief available at time of investment) to Ordinary shareholders and 4% to S shareholders. Since the Company's launch, and after receipt of the proposed final dividend, Ordinary shareholders and S shareholders will have received 22.8p and 9.85p respectively in tax-free dividends.

Distributable Reserve

On 13 June 2011, the Court order approving the reduction in share premium account, as voted for by shareholders at the General Meeting on 1 February 2011, became effective. The purpose of the reduction was to provide the Company with greater flexibility in returning funds to shareholders, whether through the payment of dividends, share buy-backs or other means.

Principal risks and uncertainties

The Board has reviewed the principal risks and uncertainties facing the Company, which are set out in the annual report and are the risks involved in investment in small and unquoted companies. In order to reduce the exposure to investment risk, the Company has invested in a broadly-based portfolio of mature companies in the United Kingdom.

VCT Qualifying Status

The VCT qualifying status of the Company is reviewed regularly by your Board and monitored on a continuous basis by the Manager in order to ensure that all of the criteria for VCT qualifying status continue to be met. I can confirm that all tests were met throughout the year.

Investment Strategy

The Manager's investment strategy is to build a large and diversified portfolio of income producing, later stage private companies across a range of sectors and industries. The principal domicile of these companies will generally be in the UK, although many have an export dimension or overseas operations.

The Board and the Manager have previously concluded that the potential returns available from AIM and PLUS quoted investments are too uncertain, with very limited liquidity in many stocks and poor dividend yield in comparison with private equity investments.  The Manager has therefore continued to selectively realise the AIM portfolio for value over the past 12 months, and redeploy the proceeds into investments in established, income-producing private companies.

Shareholder value is created through a combination of generating revenue from loan stock holdings and capital proceeds arising from profitable realisations, normally via an eventual trade sale of the business. To achieve this goal, new transactions are typically structured with 70% to 90% in secured, yielding loan stock, in companies where an equity stake can also be acquired at a reasonable entry price, and where the Manager perceives an opportunity to arbitrage a capital profit when the business achieves greater scale and maturity.

The revised Listing Rules require your Board to ensure that this and subsequent reports carry additional information on investment policy, in particular statements concerning asset mix, the spread of risk and maximum exposures. This information is contained in the Directors' Report and in the tabular analyses of the portfolio.

Valuation Process

Investments held by Maven Income and Growth VCT 4 in unquoted companies are valued in accordance with the International Private Equity And Venture Capital Valuation Guidelines.

Investments quoted or traded on a recognised stock exchange, including AIM, are valued at their bid prices.

Portfolio Developments

During the year your Company participated in five substantial new private company transactions, as well as ten follow-on investments intended to support the development of existing portfolio companies. Most of the existing private equity assets are trading acceptably or ahead of plan. There has also been significant recent acquisition interest in several portfolio companies and the Manager is currently working on the potential sale of a number of holdings, although there is no certainty that any of these discussions will result in successful exits.

In line with the strategy of reducing the exposure to AIM, a number of further disposals were made during the period and the portfolio is now almost exclusively invested in private companies, with AIM securities now representing only 4.2% and 1.5% of the asset base for the Ordinary Pool and S pool respectively (2010: Ordinary Pool 8.9%, S Pool 3.4%). The proceeds of those disposals are then available for investment in the further growth of the private equity portfolio.

Your Company continues to co-invest in each transaction with other Maven client funds, which allows the Manager to invest in a greater range and size of transaction on behalf of VCT clients than would otherwise be the case.

Recovery of VAT

The Board continues to pursue the recovery of VAT and interest on VAT paid on management fees paid in the years before October 2008 and is confident of making progress in this area. We expect that further sums will be recovered in due course.

Co-Investment Scheme of the Manager

The co-investment scheme, which allows executive members of the Manager to invest alongside the Company, continued in operation during the year. The scheme operates through a nominee company which invests alongside the Company in each and every transaction made by the Company, including any follow-on investments. The scheme more closely aligns the interests of the executives and the Company's shareholders while providing an incentive to enable the Manager to retain the existing skills and capacity of the Manager's investment team in a competitive market.

Share Capital

As reported previously, in the period to 29 April 2011 your Company raised further funds through the Maven Linked VCT Offer 2. An additional £395,843 was raised, at a cost of 5% of total funds raised, and 431,672 new shares were issued.   In December 2011 your Board announced its intention to offer a further opportunity to acquire New Ordinary Shares and New S Ordinary Shares through a top-up Offer aiming to raise £1.25 million before expenses, which is within the maximum permitted under the prospectus rules and avoids the higher costs associated with publishing a full prospectus.

On 1 March 2012, the Company issued and allotted 482,424 New Ordinary Shares and 268,769 New S Ordinary Shares under the Offer. At that point the Offer had been over-subscribed and the Board announced its closure on 2 March 2012. The remaining shares will be allotted on 5 April 2012 for the 2011/2012 tax year and on 18 April 2012 for the 2012/2013 tax year.

The Company may use the money raised, under both the earlier top-up Offer and the latest Offer, to pay dividends and general running costs. This has the effect of preserving for investment purposes an equivalent sum of valuable 'old money' which operates under more advantageous VCT regulations. The proceeds of both Offers will provide additional liquidity for the Company to make further later-stage investments, and allow it to spread its costs over a larger asset base to the benefit of all Shareholders.

Outlook

Although the UK economy continues to face significant uncertainty, with widespread concerns over the prospects for growth and potential for rising inflation, well run cash-generative smaller companies continue to prosper. As a result of the persistent scarcity of bank debt available to growth companies looking for additional capital, there are continuing opportunities for well managed generalist VCTs to identify and invest in established, progressive businesses with strong balance sheets and proven business models. The Manager has been able to source a steady flow of private company introductions across the UK, allowing your Company to invest in good quality assets which are capable of generating significant income in support of a sustainable dividend programme.

Investors have been contending with record low interest rates since early 2009 and your Board recognises that regular tax-free income is a significant factor in VCT investment, alongside the ability to generate capital gains in the medium to long term. Your Company continues to build momentum, with a more established portfolio and improving dividends which bode well for future Shareholder returns.

Ian Cormack

Chairman

16 April 2012

Investment Manager's Review

Overview

The prospects for the UK economy remain uncertain, with most indicators suggesting low economic growth is likely to persist for a number of years ahead. This view is further supported by the Government's 2011 Autumn Statement which forecasts that the public sector borrowing requirement will increase over the next five years, and an extended period of spending restraint will be required in order to ensure that the UK maintains its current rating with the key credit agencies. This fiscal control and lower discretionary spend capacity is likely to impact on both consumer and investor confidence over the medium term.

Notwithstanding the challenges facing the UK economy, we are encouraged to note that the majority of private company assets in the portfolio are trading in line with expectations, and are creating value for our client investors through a combination of revenue generation to fund dividends, and capital growth.

The fundamental strategy pursued by Maven is to use its national presence and local advisory relationships to generate a high level of new transaction introductions each year, and to invest selectively and conservatively in earnings reliable and well managed private companies on prudent entry multiples. This approach has ensured positive shareholder returns have been consistently achieved in recent years and will continue to be at the cornerstone of our investment approach.

We believe there are continuing positive medium term prospects for potential deal flow in our target private equity market, as well resourced generalist VCT managers continue to be introduced to high quality later-stage private companies seeking capital to expand.  Maven has been introduced to over 400 private company transactions around the UK in the past 12 months, mainly by a network of long-established contacts across the corporate finance and business community.

Investment Activity

During the year the Maven team completed five substantial new private equity investments on behalf for your company, alongside ten follow-on investments in existing portfolio companies. At the year end, the portfolio stood at 55 unlisted and AIM investments at a total cost of £12.7 million.

The following investments have been completed during the period.

Investment	Date	Sector	Investment cost    £'000		Website
			Original pool	S Share Pool
Unlisted
ATR Holdings Limited	Feb-11	Oil equipment services	14	8	www.atrgroup.co.uk
Blackford Capital Limited	Nov-11	Food Producer  & Processor	75	-	No website available
Camwatch Limited	Aug-11	Telecommunication services	70	40	www.camwatch.co.uk
Claven Holdings Limited	Feb-11	Financial services	26	13	No website available
Corinthian Foods Limited	Nov-11	Food Producer  & Processor	250	-	No website available
Glacier Energy Services Group Limited	Mar-11	Oil equipment services	119	99	www.glacier.co.uk
Lawrence Recycling & Waste Management	Dec-11	Support services	15	10	www.lawrenceskiphire.co.uk
LCL Hose Limited	Sep-11	Manufacturing	149	99	www.dantec.ltd.uk
Lemac No.1 Limited	Oct-11	Manufacturing	106	85	www.mcgavigan.com
Maven Co-invest Exodus Limited Partnership	Jun-11	Telecommunication services	274	192	No website available
Moriond Limited	Dec-11	Real Estate	200	150	No website available
Nessco Group Holdings Limited	Oct-11	Oil equipment services	31	50	www.nesscogroup.com
Space Student Living Limited	Jun-11	Support services	154	124	No website available
TC Communications Holdings Limited	May-11	Support services	43	27	www.tccommunications.co.uk
Torridon Capital Limited	Apr-11	Financial services	87	74	www.elite-insurance.co.uk
Total Unlisted investment			1,613	971
AIM
Marechale Capital PLC	Feb-11	Financials services	3	1	www.marechalecapital.com
Marwyn Management Partners	Jul-11	Financials services	16	17	www.marwyn.com
Total AIM investment			19	18
Listed
Treasury 5.25% 7 June 2012	Dec-11	Gilt	600	250
			600	250
Total			2,232	1,239

Unlisted Portfolio Developments

Five substantial private company investments were added to the portfolio during the period under review.

•     Glacier Energy Services, a profitable oil and gas service group with two specialist trading subsidiaries, Roberts Pipeline Machining and Wellclad. Roberts designs and manufactures on-site portable cutting machines for blue chip oil and gas clients. Wellclad provides services to the European offshore and subsea equipment market. Glacier is focused on growth within its core UK market as well as promoting its technologies to the international oil and gas market.

•     Space Student Living, a business providing contracted property management services across the student housing sector. Space aims to achieve significant growth across its consultancy services operation, in tandem with the acquisition of further long term management contracts.

•     Maven Co-invest Exodus, a new company trading as 60, established by Penta Capital to implement a buy-and-build strategy in the business telecommunications service sector based on the converging of mobile, fixed-line, broadband, internet and IT technology businesses. Penta is an established private equity firm with which Maven previously co-invested in the successful 2010 management buy-out of esure.

•     LCL Hose, (trading as Dantec) a specialist manufacturer of hand-built composite hoses for the global petrochemical industry. Composite hoses provide the vital flexible connection in many fluid transfer systems, and are used worldwide in applications such as unloading road, rail and marine tankers within chemical and oil plants, and in Formula 1 racing. Dantec exports around 70% of its output and is engaged in a number of significant overseas projects.

•     Moriond, a new company set up to acquire an established residential property portfolio at a significant discount to open market value. Maven will work on a joint venture basis with an experienced developer to break up the portfolio into single lots, carry out minor refurbishment, and then implement a structured sale of the individual assets over an 18-24 month period. The transaction is projected to generate a significant capital gain alongside a 6.5% paid yield through the life of the investment.

In a number of cases the Manager is also currently engaged with investee companies and prospective acquirers at various stages of a potential exit process. This realisation activity reflects the increasing maturity of a number of holdings, but it should be noted that there can be no certainty that these discussions will ultimately lead to profitable sales.

There was one notable private company exit during the period. The investment in Dalglen 1150 (Walker Technical Resources) was realised in July with further proceeds received on agreement of completion accounts. Total proceeds over the life of the investment were £1.05m representing an overall 3.0 times return on the initial investment cost. The exit was via a secondary buy-out, funded by Gresham Private Equity, just two years after Maven originally led the management buy-in in June 2009. Walker, which provides some of the most advanced composite repairs technology available for the global oil & gas industry, has consistently traded ahead of budget and has more than doubled earnings since the initial investment.

The table on page 13 gives details of realisations during the reporting period.

			Ordinary Shares					S Shares
	Date first invested	Complete/ partial exit	Cost of shares disposed of	Value at 31 December 2010	Sales proceeds	Realised gain/ (loss)	Realised gain/(loss) over December 2010 Valuation	Cost of shares disposed of	Value at 31 December 2010	Sales proceeds	Realised gain/(loss)	Realised gain/(loss) over December 2010 Valuation
			£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Unlisted
Ailsa Craig Capital Limited	2009	Complete	249	249	249	-	-	169	169	169	-	-
Atlantic Foods Group Limited	2008	Partial	-	-	-	-	-	56	56	63	7	7
Attraction World Holdings Limited	2010	Partial	39	47	39	-	(8)	30	30	30	-	-
Dalglen (1150) (trading as Walker Technical Resources)	2009	Complete	249	592	627	378	35	99	264	251	152	-13
Dunning Capital Limited	2009	Complete	249	249	249	-	-	149	149	149	-	-
Essential Viewing Systems	2001	Complete	192	166	239	47	73	-		-	-	-
Oliver Kay	2007	Partial	4	4	4	-	-	-		-	-	-
Shiskine Capital Limited	2009	Complete	249	249	249	-	-	149	149	149	-	-
Tosca Penta Investments Limited Partnership	2010	Partial	13	13	13	-	-	13	18	13	-	(5)
Others			71	27	31	(40)	4	37	14	16	(21)	2
			1,315	1,596	1,700	385	104	702	849	840	138	(9)
AIM
Brookwell Limited	2011	Partial	22	15	17	(5)	2	5	3	4	(1)	1
Individual Restaurant Company	2006	Complete	47	4	4	(43)	-	-	-	-	-	-
OPG Power Ventures	2008	Complete	39	52	55	16	3	39	52	56	17	4
Praesepe Plc	2008	Complete	49	12	17	(32)	5	50	12	17	(33)	5
Software Radio Technology	2005	Partial	8	10	12	4	2	-	-	-	-	-
System C Healthcare	2005	Complete	150	0	194	44	194	-	-	-	-	-
Others			66	0	35	(31)	35	132	-	70	(62)	70
			381	93	334	(47)	241	226	67	147	(79)	80
			1,696	1,689	2,034	338	345	928	916	987	59	71

One unlisted investment and one AIM company were struck off the Register during the year resulting in a realised losses of £232,000 (cost £267,000) and £62,000 (cost £132,000) for the Ordinary Share Pool and S Share Pool respectively. This had no effect on the NAV as a full provision had been made in earlier years.

In respect of AIM holdings the Manager has continued its policy of structured exits from this part of the portfolio. Four AIM securities were purchased by a closed ended investment company established to acquire investments which were underperforming or trading below entry price. These transactions incurred realised losses of £126,000 (cost £179,000) and £41,000 (cost £52,000) for the Ordinary Share Pool and S Share Pool respectively during the year.

Outlook

Your Company's portfolio has benefitted from significant diversification in recent years, with a specific focus on investing in a wide range of later-stage private companies with income generating characteristics. There is increased competition among providers of alternative capital for access to attractive private equity transactions, and good quality private company opportunities are at a premium.  However with one of the most highly resourced and experienced management teams in the industry, Maven has access to a UK-wide network of introducers and is therefore well placed to continue to expand the asset base and consistently grow shareholder value.

INCOME STATEMENT
For the year ended 31 December 2011
		Ordinary Shares			S Ordinary Shares			TOTAL
		Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	Notes	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Gains on investments	8	-	546	546	-	350	350	-	896	896
Income from investments	2	393	-	393	240	-	240	633	-	633
Other income	2	1	-	1	-	-	-	1	-	1
Investment management fees	3	(53)	(212)	(265)	(15)	(62)	(77)	(68)	(274)	(342)
Other expenses	4	(176)	-	(176)	(102)	-	(102)	(278)	-	(278)
Net Return on ordinary activities before taxation		165	334	499	123	288	411	288	622	910
Tax on ordinary activities	5	(32)	32	-	(12)	12	-	(44)	44	-
Return attributable to Equity Shareholders		133	366	499	111	300	411	244	666	910
Earnings per share (pence)		1.5	4.3	5.8	2.3	6.1	8.4	3.8	10.4	14.2

A Statement of Total Recognised Gains and Losses has not been prepared, as all gains and losses are recognised in the Income Statement.

All items in the above statement are derived from continuing operations.  The Company has only one class of business and derives its income from investments made in shares, securities and bank deposits.

The total column of this statement is the Profit and Loss Account of the Company.

RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS For the year ended 31 December 2011
	Ordinary Shares			S Ordinary Shares				TOTAL
	£'000			£'000				£'000
Opening Shareholders' funds		7,964			4,801			12,765
Net return for year		499			411			910
Net proceeds of share issue		377			-			377
Repurchase and cancellation of shares		(261)			(55)			(316)
Dividends paid - revenue		(43)			(25)			(68)
Dividends paid - capital		(305)			(74)			(379)
Closing Shareholders' funds		8,231			5,058			13,289

The accompanying Notes are an integral part of the Financial Statements.

INCOME STATEMENT For the year ended 31 December 2010
		Ordinary Shares			S Ordinary Shares			TOTAL
		Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	Notes	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Gains on investments	8	-	799	799	-	278	278	-	1,077	1,077
Income from investments	2	229	-	229	121	-	121	350	-	350
Other income	2	-	-	-	-	-	-	-	-	-
Investment management fees	3	(14)	(57)	(71)	(14)	(55)	(69)	(28)	(112)	(140)
Other expenses	4	(201)	-	(201)	(122)	-	(122)	(323)	-	(323)
Net Return on ordinary activities before taxation		14	742	756	(15)	223	208	(1)	965	964
Tax on ordinary activities	5	(1)	1	-	-	-	-	(1)	1	-
Return attributable to Equity Shareholders		13	743	756	(15)	223	208	(2)	966	964
Earnings per share (pence)		0.2	9.0	9.2	(0.3)	4.5	4.2	(0.1)	13.5	13.4

A Statement of Total Recognised Gains and Losses has not been prepared, as all gains and losses are recognised in the Income Statement.

All items in the above statement are derived from continuing operations. The Company has only one class of business and derives its income from investments made in shares, securities and bank deposits.

The total column of this statement is the Profit and Loss Account of the Company.

RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS For the year ended 31 December 2010
	Ordinary Shares			S Ordinary Shares				TOTAL
	£'000			£'000				£'000
Opening Shareholders' funds		6,996			4,693			11,689
Net return for year		756			208			964
Net proceeds of share issue		605			-			605
Repurchase and cancellation of shares		(98)			(26)			(124)
Dividends paid - revenue		(42)			(25)			(67)
Dividends paid - capital		(253)			(49)			(302)
Closing Shareholders' funds		7,964			4,801			12,765

The accompanying Notes are an integral part of the Financial Statements.

BALANCE SHEET As at 31 December 2011
		31 December 2011			31 December 2010
		Ordinary	S Ordinary		Ordinary	S Ordinary
		Shares	Shares	Total	Shares	Shares	Total
	Notes	£'000	£'000	£'000	£'000	£'000	£'000
Fixed assets
Investments at fair value through profit or loss	8	7,697	4,603	12,300	6,956	4,002	10,958
Current assets
Debtors	10	233	125	358	167	78	245
Cash and overnight deposits		399	356	755	890	753	1,643
		632	481	1,113	1,057	831	1,888
Creditors:
Amounts falling due within one year	11	(98)	(26)	(124)	(49)	(32)	(81)
Net current assets		534	455	989	1,008	799	1,807
Total net assets		8,231	5,058	13,289	7,964	4,801	12,765
Capital and reserves
Called up share capital	12	839	486	1,325	832	494	1,326
Share premium  account	13	-	-	-	538	4,227	4,765
Capital reserve - realised	13	611	-	611	1,085	106	1,191
Capital reserve - unrealised	13	(701)	294	(407)	(1,236)	(38)	(1,274)
Distributable reserve	13	7,168	4,149	11,317	6,539	(26)	6,513
Capital redemption reserve	13	37	8	45	19	3	22
Revenue reserve	13	277	121	398	187	35	222
Net assets attributable to Ordinary Shareholders		8,231	5,058	13,289	7,964	4,801	12,765
Net asset value per ordinary share (pence)	14	98.2	104.1		95.7	97.3

The Financial Statements of Maven Income and Growth VCT 4 PLC, registered number SC272568, were approved by the Board of Directors and were signed on its behalf by:

16 April 2012

The accompanying Notes are an integral part of the Financial Statements.

CASH FLOW STATEMENT
For the year ended 31 December 2011
		Year ended 31 December 2011			Year ended 31 December 2010
		Ordinary	S Ordinary		Ordinary	S Ordinary
		Shares	Shares	Total	Shares	Shares	Total
	Notes	£'000	£'000	£'000	£'000	£'000	£'000
Operating activities
Investment income received		328	193	521	226	109	335
Deposit interest received		1	-	1	-	-	-
Investment management fees paid		(200)	(71)	(271)	(82)	(77)	(159)
Secretarial fees paid		(66)	(41)	(107)	(48)	(33)	(81)
Directors expenses paid		(41)	(25)	(66)	(39)	(26)	(65)
Other cash payments		(85)	(48)	(133)	(111)	(63)	(174)
Net cash (outflow)/inflow from operating activities	15	(63)	8	(55)	(54)	(90)	(144)
Taxation
Corporation tax		-	-	-	(22)	(5)	(27)
Financial investment
Purchase of investments		(2,284)	(1,250)	(3,534)	(1,401)	(1,829)	(3,230)
Sale of investments		2,088	999	3,087	1,399	945	2,344
Net cash outflow from financial investment		(196)	(251)	(447)	(2)	(884)	(886)
Equity dividends paid		(348)	(99)	(447)	(295)	(74)	(369)
Net cash outflow before financing		(607)	(342)	(949)	(373)	(1,053)	(1,426)
Financing
Issue of Ordinary Shares		377	-	377	605	-	605
Repurchase of Ordinary Shares		(261)	(55)	(316)	(98)	(26)	(124)
Net cash inflow/(outflow) from financing		116	(55)	61	507	(26)	481
(Decrease)/increase in cash	16	(491)	(397)	(888)	134	(1,079)	(945)

The accompanying Notes are an integral part of the Financial Statements.

Notes to the Financial Statements

For the year ending 31 December 2011

1 Accounting Policies - UK Generally Accepted Accounting Practice

(a)  Basis of preparation

      The Financial Statements have been prepared under the historical cost convention modified to include the  revaluation of investments and in accordance with the Statement of Recommended Practice 'Financial Statements of Investment Trust Companies' and Venture Capital Trusts (the SORP) issued in January 2009.  The disclosures on Going Concern on page 29 of the Directors' Report form part of these financial statements.

 (b) Income

      Dividends receivable on equity shares and unit trusts are treated as revenue for the period on an ex-dividend basis.   Where no ex-dividend date is available dividends receivable on or before the year end are treated as revenue for the period. Provision is made for any dividends not expected to be received.  The fixed returns on debt securities and non-equity shares are recognised on a time apportionment basis so as to reflect the effective interest rate on the debt securities and shares.  Provision is made for any fixed income not expected to be received.  Interest receivable from cash and short term deposits and interest payable are accrued to the end ofthe year.

 (c) Expenses

      All expenses are accounted for on an accruals basis and charged to the income statement.  Expenses are charged through the revenue account except as follows:

      -     expenses which are incidental to the acquisition and disposal of an investment are charged to capital.

      -     expenses are charged to realised capital reserves where a connection with the maintenance or enhancement of the value of the investments can be demonstrated.  In this respect the investment management fee has been allocated 20% to revenue and 80% to realised capital reserves to reflect the Company's investment policy and prospective income and capital growth.

      -     share issue costs are charged to the share premium account: and

      -     expenses are allocated between the original pool or the S share pool depending on the nature of the expense.

 (d) Taxation

      Deferred taxation is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date, where transactions or events that result in an obligation to pay more tax in the future or right to pay less tax in the future have occurred at the balance sheet date.  This is subject to deferred tax assets only being recognised if it is considered more likely than not that there will be suitable profits from which the future reversal of the underlying timing differences can be deducted.  Timing differences are differences arising between the Company's taxable profits and its results as stated in the Financial Statements which are capable of reversal in one or more subsequent periods.

      Deferred tax is measured on a non-discounted basis at the tax rates that are expected to apply in the periods in which timing differences are expected to reverse, based on tax rates and laws enacted or substantively enacted at the balance sheet date. 

      The tax effect of different items of income/gain and expenditure/loss is allocated between capital reserves and revenue account on the same basis as the particular item to which it relates using the Company's effective rate of tax for the period.

      UK Corporation tax is provided at amounts expected to be paid/recovered using the tax rates and laws that have been enacted or substantively enacted at the balance sheet date.

 (e) Investments

      In valuing unlisted investments the Directors follow the criteria set out below. These procedures comply with the revised International Private Equity and Venture Capital Valuation Guidelines for the valuation of private equity and venture capital investments. Investments are recognised at their trade date and are designated by the Directors as fair value through profit or loss.  At subsequent reporting dates, investments are valued at fair value, which represent the Directors' view of the amount for which an asset could be exchanged between knowledgeable willing parties in an arm's length transaction. This does not assume that the underlying business is saleable at the reporting date or that its current shareholders have an intention to sell their holding in the near future.

      A financial asset or liability is generally derecognised when the contract that gives rise to it is settled, sold, cancelled or expires.

1.     For Investments completed within the 12 months prior to the reporting date and those at an early stage in their development, fair value is determined using the Price of Recent Investment Method, except that adjustments are made when there has been a material change in the trading circumstances of the company or a substantial movement in the relevant sector of the stock market.

2.     Whenever practical, recent investments will be valued by reference to a material arm's length transaction or a quoted price.

      3.    Mature companies are valued by applying a multiple to their fully taxed prospective earnings to determine the enterprise value of the company.

3.1    To obtain a valuation of the total ordinary share capital held by management and the institutional investors, the value of third party debt, institutional loan stock, debentures and preference share capital is deducted from the enterprise value. The effect of any performance related mechanisms is taken into account when determining the value of the ordinary share capital.

3.2    Preference shares, debentures and loan stock are valued using the Price of Recent Investment Method. When a redemption premium has accrued, this will only be valued if there is a reasonable prospect of it being paid. Preference shares which carry a right to convert into ordinary share capital are valued at the higher of the Price of Recent Investment Method basis and the price/earnings basis, both described above.

3.    Where there is evidence of impairment, a provision may be taken against the previous valuation of the investment.

4.    In the absence of evidence of a deterioration, or strong defensible evidence of an increase in value, the fair value is determined to be that reported at the previous balance sheet date.

5.    All unlisted investments are valued individually by the Portfolio Management Team of Maven Capital Partners UK LLP. The resultant valuations are subject to detailed scrutiny and approval by the Directors of the Company.

 7.   In accordance with normal market practice, investments listed on the Alternative Investment Market or a recognised stock exchange are valued at their bid market price.

 (f) Fair Value Measurement

      Fair value is defined as the price that the Company would receive upon selling an investment in a timely transaction to an independent buyer in the principal or the most advantageous market of the investment.  A three-tier hierarchy has been established to maximise the use of observable market data and minimise the use of unobservable inputs and to establish classification of fair value measurements for disclosure purposes.  Inputs refer broadly to the assumptions that market participants would use in pricing the asset or liability, including assumptions about risk, for example, the risk inherent in a particular valuation technique used to measure fair value including such a pricing model and/or the risk inherent in the inputs to the valuation technique.  Inputs may be observable or unobservable.  Observable inputs are inputs that reflect the assumptions market participants would use in pricing the asset or liability developed based on market data obtained from sources independent of the reporting entity.  Unobservable inputs are inputs that reflect the reporting entity's own assumptions about the assumptions market participants would use in pricing the asset or liability developed based on best information available in the circumstances.

      The three-tier hierarchy of inputs is summarised in the three broad levels listed below.

 - Level 1 -   quoted prices in active markets for identical investments

 - Level 2 -   other significant observable inputs (included quoted prices for similar investments, interest rates, prepayment speeds, credit risk etc).

 - Level 3 -   significant unobservable inputs (including the Company's own assumptions in determining the fair value of investments).

 (g)  Gains and losses on investments

         When the company sells or revalues its investments during the year, any gains or losses arising are credited/ charged to the Income Statement.

Notes to the Financial Statements
	Year ended			Year ended
	31 December 2011			31 December 2010
	Ordinary	S Ordinary	Total	Ordinary	S Ordinary	Total
	Shares	Shares		Shares	Shares
	£'000	£'000	£'000	£'000	£'000	£'000
2 Income
Income from investments:
UK franked investment income	6	1	7	9	2	11
UK unfranked investment income	387	239	626	220	119	339
	393	240	633	229	121	350
Other Income:
Deposit interest	1	-	1	-	-	-
Total income	394	240	634	229	121	350
Total income comprises:
Dividends	6	1	7	9	2	11
Interest	388	239	627	220	119	339
	394	240	634	229	121	350

				Year ended
				31 December 2011
	Ordinary Shares			S Ordinary Shares			TOTAL
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
3  Investment management fees	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Investment management fees	26	103	129	15	62	77	41	165	206
Performance fees	27	109	136	-	-	-	27	109	136
	53	212	265	15	62	77	68	274	342

				Year ended
				31 December 2010
	Ordinary Shares			S Ordinary Shares			TOTAL
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Investment management fees	28	114	142	19	73	92	47	187	234
VAT reclaim	(14)	(57)	(71)	(5)	(18)	(23)	(19)	(75)	(94)
	14	57	71	14	55	69	28	112	140

Details of the fee basis are contained in the Director's Report on page 24.

	Year ended
	31 December 2011
	Ordinary Shares			S Ordinary Shares			TOTAL
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
4 Other expenses
Secretarial fees	54	-	54	33	-	33	87	-	87
Directors' remuneration	41	-	41	25	-	25	66	-	66
Fees to auditors - audit services	10	-	10	6	-	6	16	-	16
Fees to auditors - tax services	3	-	3	1	-	1	4	-	4
Miscellaneous expenses	68	-	68	37	-	37	105	-	105
	176	-	176	102	-	102	278	-	278

	Year ended
	31 December 2010
	Ordinary Shares			S Ordinary Shares			TOTAL
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Secretarial fees	49	-	49	33	-	33	82	-	82
Directors' remuneration	39	-	39	26	-	26	65	-	65
Fees to Auditor - audit services	9	-	9	6	-	6	15	-	15
Fees to Auditor - tax services	3	-	3	1	-	1	4	-	4
Miscellaneous expenses	101	-	101	56	-	56	157	-	157
	201	-	201	122	-	122	323	-	323

Year ending 31 December 2011

Ordinary

Ordinary

Ordinary

S Ordinary

S Ordinary

S Ordinary

Total

Shares

Shares

Shares

Shares

Shares

Shares

Revenue

Capital

Total

Revenue

Capital

Total

Revenue

Capital

Total

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

5 Tax on ordinary activities

Corporation tax

(32)

32

-

(12)

12

-

(44)

44

-

Year ending 31 December 2010

Ordinary

Ordinary

Ordinary

S Ordinary

S Ordinary

S Ordinary

Total

Shares

Shares

Shares

Shares

Shares

Shares

Revenue

Capital

Total

Revenue

Capital

Total

Revenue

Capital

Total

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

£'000

Corporation tax

(1)

1

-

-

-

-

(1)

1

-

The tax assessed for the period is lower than the standard rate of corporation tax of 26% (2010: 28%).  The differences are explained below:

	Year ending 31 December 2011
	Ordinary	Ordinary	Ordinary	S Ordinary	S Ordinary	S Ordinary	Total
	Shares	Shares	Shares	Shares	Shares	Shares
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Return on ordinary activities before tax	165	334	499	123	288	411	288	622	910
Revenue return on ordinary activities	43	87	130	32	75	107	75	162	237
multiplied by standard rate of corporation tax
Non taxable UK dividend income	(2)	-	(2)	-	-	-	(2)	-	(2)
Gains on investments	-	(142)	(142)	-	(91)	(91)	-	(233)	(233)
Utilisation of taxable losses	-	-	-	(16)	-	(16)	(16)	-	(16)
Smaller Companies relief	(9)	23	14	(4)	4	-	(13)	27	14
	32	(32)	-	12	(12)	-	44	(44)	-

Losses with a tax value of £29,742 (2010: £34,447) are available to carry forward against future trading profits.  These have not been recognised as a deferred tax asset as recoverability is not sufficiently certain.

	Year ending 31 December 2010
	Ordinary	Ordinary	Ordinary	S Ordinary	S Ordinary	S Ordinary	Total
	Shares	Shares	Shares	Shares	Shares	Shares
	Revenue	Capital	Total	Revenue	Capital	Total	Revenue	Capital	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Return on ordinary activities before tax	14	742	756	(15)	223	208	(1)	965	964
Revenue return on ordinary activities	4	208	212	(4)	62	58	-	270	270
multiplied by standard rate of corporation tax
Non taxable UK dividend income	(3)	-	(3)	-	-	-	(3)	-	(3)
Gains on investments	-	(224)	(224)	-	(78)	(78)	-	(302)	(302)
Utilisation of taxable losses	-	-	-	-	-	-	-	-	-
Smaller Companies relief	-	15	15	4	16	20	4	31	35
	1	(1)	-	-	-	-	1	(1)	-

6 Dividends	Year ended			Year ended
	31 December 2011			31 December 2010
	Ordinary	S Ordinary		Ordinary	S Ordinary
	Shares	Shares	Total	Shares	Shares	Total
	£'000	£'000	£'000	£'000	£'000	£'000
Revenue dividends
Final revenue dividend for the year ended
31 December 2010 of Nil (2009: 0.5p)	-	-	-	42	25	67
Interim revenue dividend for the year ended
31 December 2011 of 0.5p (2010: Nil) paid on 28 September 2011	43	25	68	-	-	-
	43	25	68	42	25	67

Capital dividends
Final capital dividend for the year ended
31 December 2010 of 2.5p (2009: 2.0p) paid on 27 May 2011	219	-	219	169	-	169
Final capital dividend for the year ended
31 December 2010 of 0.5p (2009: Nil) paid on 27 May 2011	-	25	25	-	-	-
Interim capital dividend for the year ended
31 December 2011 of 1.0p (2010: 1.0p) paid on 28 September 2011	86	49	135	84	49	133
	305	74	379	253	49	302
Revenue dividends
We set out below the total dividends proposed in respect of the financial year, which is the
basis on which the requirements of Section 274 of the Income Tax Act 2007 are considered.
Revenue available for distribution by way of dividends for the year	133	111	244	13	(15)	(2)
Final revenue dividend proposed for the year ended 31 December
2011 of 0.6p (2010: Nil) payable on 20 May 2012	51	-	51	-	-	-
Final revenue dividend proposed for the year ended 31 December
2011 of 1.3p (2010: Nil) payable on 20 May 2012	-	64	64	-	-	-
	51	64	115	-	-	-

Capital dividends
Final capital dividend proposed for the year ended 31 December
2011 of 1.9p (2010: 2.5p) payable on 20 May 2012	162	-	162	206	-	206
Final capital dividend proposed for the year ended 31 December	-	-	-	-	25	25
2011 of Nil (2010: 0.5p)
	162	-	162	206	25	231
	Year ended			Year ended
	31 December 2011			31 December 2010
7 Return per ordinary share
The returns per share have been based on the following	Ordinary	S Ordinary		Ordinary	S Ordinary
figures:	Shares	Shares	Total	Shares	Shares	Total
Weighted average number of ordinary shares	8,541,693	4,917,310	13,459,003	8,243,192	4,937,304	13,180,496
Revenue return	£133,000	£111,000	£244,000	£13,000	(£15,000)	(£2,000)
Capital return	£366,000	£300,000	£666,000	£743,000	£223,000	£966,000
Total Return	£499,000	£411,000	£910,000	£756,000	£208,000	£964,000

8 Investments
		Year ended 31 December 2011
	Ordinary Shares				S Ordinary Shares				Total
	Listed	AIM	Unlisted/AIM		Listed	AIM	Unlisted/AIM		Listed	AIM	Unlisted/AIM
	(quoted	(quoted	(unobservable		(quoted	(quoted	(unobservable		(quoted	(quoted	(unobservable
	prices)	prices)	inputs)	Total	prices)	prices)	inputs)	Total	prices)	prices)	inputs)	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Movements during the year:
Valuation at 1 January 2011	-	710	6,246	6,956	-	162	3,840	4,002	-	872	10,086	10,958
Unrealised loss/(gain)	-	1,087	149	1,236	-	274	(236)	38	-	1,361	(87)	1,274
Cost at 1 January 2011	-	1,797	6,395	8,192	-	436	3,604	4,040	-	2,233	9,999	12,232
Purchases	600	71	1,613	2,284	250	29	971	1,250	850	100	2,584	3,534
Sales proceeds	-	(387)	(1,700)	(2,087)	-	(158)	(840)	(998)	-	(545)	(2,540)	(3,085)
Realised gains	-	(173)	184	11	-	(120)	138	18	-	(293)	322	29
Amortisation of book cost	(2)	-	-	(2)	(1)	-	-	(1)	(3)	-	-	(3)
Cost at 31 December 2011	598	1,308	6,492	8,398	249	187	3,873	4,309	847	1,495	10,365	12,707
Unrealised (loss)/gain	(1)	(962)	262	(701)	(1)	(112)	407	294	(2)	(1,074)	669	(407)
Valuation at 31 December 2011	597	346	6,754	7,697	248	75	4,280	4,603	845	421	11,034	12,300

Note 1(f) defines the three tier hierarchy of investments, and the significance of the information used to determine their fair value, that is required by Financial Reporting Standard 29 "Financial Instruments: Disclosures".

		Year ended 31 December 2010
	Ordinary Shares				S Ordinary Shares				Total
		AIM	Unlisted/AIM			AIM	Unlisted/AIM			AIM	Unlisted/AIM
		(quoted	(unobservable			(quoted	(unobservable			(quoted	(unobservable
		prices)	inputs)	Total		prices)	inputs)	Total		prices)	inputs)	Total
		£'000	£'000	£'000		£'000	£'000	£'000		£'000	£'000	£'000
Valuation at 1 January 2010		1,211	4,945	6,156		522	2,319	2,841		1,733	7,264	8,997
Unrealised loss		1,323	667	1,990		160	32	192		1,483	699	2,182
Cost at 1 January 2010		2,534	5,612	8,146		682	2,351	3,033		3,216	7,963	11,179
Purchases		-	1,401	1,401		-	1,829	1,829		-	3,230	3,230
Sales proceeds		(772)	(628)	(1,400)		(363)	(583)	(946)		(1,135)	(1,211)	(2,346)
Realised gains		35	10	45		117	7	124		152	17	169
Cost at 31 December 2010		1,797	6,395	8,192		436	3,604	4,040		2,233	9,999	12,232
Unrealised (loss)/gain		(1,087)	(149)	(1,236)		(274)	236	(38)		(1,361)	87	(1,274)
Valuation at 31 December 2010		710	6,246	6,956		162	3,840	4,002		872	10,086	10,958

		31 December 2011				31 December 2010
		Ordinary		S Ordinary		Ordinary	S Ordinary
		Shares		Shares	Total	Shares	Shares	Total
The portfolio valuation		£'000		£'000	£'000	£'000	£'000	£'000
Held at market valuation:
Listed fixed income		597		248	845	-	-	-
AIM quoted equities		346		75	421	710	162	872
AIM unobservable equities		-		-	-	-	-	-
		943		323	1,266	710	162	872
Unlisted at Directors' valuation:
Unquoted unobservable equities		2,403		1,615	4,018	1,849	1,207	3,056
Unquoted unobservable fixed income		4,351		2,665	7,016	4,397	2,633	7,030
		6,754		4,280	11,034	6,246	3,840	10,086
Total		7,697		4,603	12,300	6,956	4,002	10,958
Realised gains on historical basis		11		18	29	45	124	169
Net movement in unrealised appreciation		535		332	867	754	154	908
Gains on investments			546	350	896	799	278	1,077

9 Participating and significant interests

The principal activity of the Company is to select and hold a portfolio of investments in unlisted and AIM securities.  Although the Company will, in some cases, be represented on the board of the investee company, it will not take a controlling interest or become involved in its management.  The size and structure of the companies with unlisted and AIM securities may result in certain holdings in the portfolio representing a participating interest without there being any partnership, joint venture or management consortium agreement.

At 31 December 2011, the Company held no shares amounting to 20% or more of the equity capital of any of the unlisted or AIM undertakings.  The Company does hold shares or units amounting to more than 3% or more of the nominal value of the allotted shares or units of any class in certain investee companies.

Details of equity percentages held are shown in the Investment Portfolio Summary on page 15.

	31 December 2011			31 December 2010
	Ordinary	S Ordinary		Ordinary	S Ordinary
	Shares	Shares	Total	Shares	Shares	Total
10 Debtors	£'000	£'000	£'000	£'000	£'000	£'000
Prepayments and accrued income	231	124	355	166	77	243
Other debtors	2	1	3	1	1	2
	233	125	358	167	78	245
11 Creditors
Accruals	98	26	124	49	32	81
	98	26	124	49	32	81

	31 December 2011				31 December 2010
	Ordinary Shares		S Ordinary Shares		Ordinary Shares		S Ordinary Shares
12 Share capital	Number	£'000	Number	£'000	Number	£'000	Number	£'000
At 31 December the authorised share capital comprised:
allotted, issued and fully paid:
Ordinary Shares of 10p each
Balance brought forward	8,323,130	832	4,936,009	494	7,798,296	780	4,972,459	497
Repurchased and cancelled in year	(368,213)	(36)	(75,000)	(8)	(152,065)	(15)	(36,450)	(3)
	7,954,917	796	4,861,009	486	7,646,231	765	4,936,009	494
Issued during the year	431,672	43	-	-	676,899	67	-	-
	8,386,589	839	4,861,009	486	8,323,130	832	4,936,009	494

During the year 368,213 Ordinary Shares (2010:152,065) of 10p each were repurchased by the Company at a total cost of £261,977 (2010: £98,361) and

cancelled.

During the year 75,000 S Ordinary Shares (2010:36,450) of 10p each were repurchased by the Company at a total cost of £54,866 (2010: £26,020) and

cancelled.

During the year the Company issued 431,672 Ordinary Shares (2010: 676,899) pursuant to the linked offer at a subscription price of 91.7p per share (2010: 89.5p).

	Share		Capital	Capital	Capital
	premium	Distributable	reserves	reserves	redemption	Revenue
	account	reserve	realised	unrealised	reserve	reserve
	£'000	£'000	£'000	£'000	£'000	£'000
13 Reserves
Ordinary Shares
At 1 January 2011	538	6,539	1,085	(1,236)	19	187
Gains on sales of investments	-	-	11	-	-	-
Net increase in value of investments	-	-	-	535	-	-
Investment management fees	-	-	(212)	-	-	-
Dividends paid	-	-	(305)	-	-	(43)
Tax effect of capital items	-	-	32	-	-	-
Share Issue - 1 February 2011	75	-	-	-	-	-
Share Issue - 5 April 2011	207	-	-	-	-	-
Share Issue - 3 May 2011	51	-	-	-	-	-
Cancellation of share premium account	(871)	871	-	-	-	-
Cancellation of capital redemption reserve	-	19	-	-	(19)	-
Repurchase and cancellation of shares	-	(261)	-	-	37	-
Net return on ordinary activities after taxation	-	-	-	-	-	133
At 31 December 2011	-	7,168	611	(701)	37	277

S Ordinary Shares
At 1 January 2011	4,227	(26)	106	(38)	3	35
Gains on sales of investments	-	-	18	-	-	-
Net increase in value of investments	-	-	-	332	-	-
Investment management fees	-	-	(62)	-	-	-
Dividends paid	-	-	(74)	-	-	(25)
Tax effect of capital items	-	-	12	-	-	-
Cancellation of share premium account	(4,227)	4,227	-	-	-	-
Cancellation of capital redemption reserve	-	3	-	-	(3)	-
Repurchase and cancellation of shares	-	(55)	-	-	8	-
Net return on ordinary activities after taxation	-	-	-	-	-	111
At 31 December 2011	-	4,149	-	294	8	121

14 Net asset value per Ordinary Share

The net asset value per share and the net asset value attributable to the Ordinary Shares at the year end calculated in accordance with the Articles of Association were as follows:

	31 December 2011				31 December 2010
	Ordinary Shares		S Ordinary Shares		Ordinary Shares		S Ordinary Shares
	Net asset	Net asset	Net asset	Net asset	Net asset	Net asset	Net asset	Net asset
	value per	value	value per	value	value per	value	value per	value
	share	attributable	share	attributable	share	attributable	share	attributable
	p	£'000	p	£'000	p	£'000	p	£'000
Ordinary Shares	98.2	8,231	104.1	5,058	95.7	7,964	97.3	4,801

The number of issued shares used in the above calculation is set out in note 12.

			Year ended		Year ended
			31 December 2011		31 December 2010
			Ordinary	S Ordinary	Ordinary	S Ordinary
			Shares	Shares	Shares	Shares
15 Reconciliation of revenue return before finance costs			£'000	£'000	£'000	£'000
and taxation to net cash inflow from operating activities
Net return before taxation			499	411	756	208
Gains on investments			(546)	(350)	(799)	(278)
Increase in accrued income			(65)	(47)	(3)	(12)
Increase/(decrease) in accruals			49	(6)	(8)	(8)
Amortisation of fixed income investment book cost			2	1	-	-
Tax on unfranked income			(2)	(1)	-	-
Net cash (outflow)/inflow from operating activities			(63)	8	(54)	(90)

	Ordinary Shares			S Ordinary Shares
16 Analysis of changes in net funds	At		At	At		At
	1 January	Cash	31 December	1 January	Cash	31 December
	2011	flows	2011	2011	flows	2011
	£'000	£'000	£'000	£'000	£'000	£'000
Cash and overnight deposits	890	(491)	399	753	(397)	356
	At		At	At		At
	1 January	Cash	31 December	1 January	Cash	31 December
	2010	flows	2010	2010	flows	2010
	£'000	£'000	£'000	£'000	£'000	£'000
Cash and overnight deposits	756	134	890	1,832	(1,079)	753

	Year ended		Year ended
	31 December 2011		31 December 2010
	Ordinary	S Ordinary	Ordinary	S Ordinary
	Shares	Shares	Shares	Shares
17. Capital commitments, contingencies and	£'000	£'000	£'000	£'000
financial guarantees
Financial guarantees	244	137	248	140

These financial guarantees represent potential further investment in unlisted securities.

18 Derivatives and other financial instruments

The Company's financial instruments comprise equity and fixed interest investments, cash balances and debtors and creditors that arise directly from its operations, for example, in respect of sales and purchases awaiting settlement, and debtors for accrued income. The company holds financial assets in accordance with its investment policy of investing mainly in a portfolio of VCT qualifying unquoted and AIM quoted securities. The Company may not enter into derivative transactions in the form of forward foreign currency contracts, futures and options without the written permission of the Directors.  No derivative transactions were entered into during the period.

The main risks the Company faces from its financial instruments are (i) market price risk, being the risk that the value of investment holdings will fluctuate as a result of changes in market prices caused by factors other than interest rates, (ii) interest rate risk, (iii) liquidity risk and (iv) credit risk.  In line with the Company's investment objective, the portfolio comprises only sterling currency securities and therefore has no direct exposure to foreign

currency risk.

The Manager's policies for managing these risks are summarised below and have been applied throughout the period.  The numerical disclosures below exclude short-term debtors and creditors which are included in the Balance Sheet at fair value.

Market price risk

The Company's investment portfolio is exposed to market price fluctuations, which are monitored by the manager in pursuance of the investment objective as set out on page 19.  Adherence to investment guidelines and to investment and borrowing policies set out in the management agreement mitigates the risk of excessive exposure to any particular type of security or issuer.  These powers and guidelines include the requirement to invest in a minimum of 30 companies across a range of industrial and service sectors at varying stages of development, to closely monitor the progress of these companies and to appoint a non executive director to the board of each company. Further information on the investment portfolio (including sector concentration and deal type analysis) is set out in the Analysis of Unlisted and AIM Portfolio, Investment Manager's Review, Summary of Investment Changes, Investment Portfolio Summary and Largest Unlisted and AIM Investments.

Interest rate risk
The interest rate risk profile of financial assets at the balance sheet date was as follows:
Ordinary Shares
At 31 December 2011	Fixed		Floating		Non interest
	Interest		rate		bearing
	£'000		£'000		£'000
Sterling
Listed fixed income	597		-		-
Unlisted and AIM/PLUS	4,351		-		2,749
Cash	-		399		-
	4,948		399		2,749
At 31 December 2010	Fixed		Floating		Non interest
	Interest		rate		bearing
	£'000		£'000		£'000
Sterling
Listed fixed income	-		-		-
Unlisted and AIM/PLUS	4,397		-		2,559
Cash	-		890		-
	4,397		890		2,559

The listed fixed interest assets have a weighted average life of 0.4 years (2010: N/A) and a weighted average interest rate of 5.2% (2010: N/A).

The unlisted fixed interest assets have a weighted average life of 2.8 years (2010: 2.8 years) and a weighted average interest rate of 10.4% (2010: 8.45%).  The non-interest bearing assets represent the equity element of the portfolio.  All assets and liabilities of the fund are included in the balance sheet at fair value.

It is the Directors opinion that the carrying amounts of these financial assets represent the maximum credit risk exposure at the balance sheet date.

The interest rate which determines the interest received on cash balances is the bank base rate.

S Ordinary Shares
At 31 December 2011	Fixed		Floating		Non interest
	Interest		rate		bearing
	£'000		£'000		£'000
Sterling
Listed Fixed Income	248		-		-
Unlisted and AIM/PLUS	2,665		-		1,690
Cash	-		356		-
	2,913		356		1,690
At 31 December 2010	Fixed		Floating		Non interest
	Interest		rate		bearing
	£'000		£'000		£'000
Sterling
Listed Fixed Income	-		-		-
Unlisted and AIM/PLUS	2,633		-		1,369
Cash	-		753		-
	2,633		753		1,369

The listed fixed interest assets have a weighted average life of 0.4 years (2010: N/A) and a weighted average

interest rate of 5.2%  (2010: N/A).

The unlisted fixed interest assets have a weighted average life of 3.2 years (2010: 3.2 years) and a weighted

average interest rate of 10.4% (2010: 8.2%).  The non-interest bearing assets represents the equity element of

the portfolio.  All assets and liabilities of the fund are included in the balance sheet at fair value.

It is the Directors opinion that the carrying amounts of these financial assets represent the maximum credit risk

exposure at the balance sheet date.

The interest rate which determines the interest received on cash balances is the bank base rate.

Maturity profile
The interest rate profile of the Company's financial assets at the Balance sheet date was as follows:
Ordinary Shares	Within	Within	Within	Within	Within	More than
	1 year	1-2 years	2-3 years	3-4 years	4-5 years	5 years	Total
At 31 December 2011	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Fixed interest
Listed	597	-	-	-	-	-	597
Unlisted	939	452	1,088	1,018	501	353	4,351
	1,536	452	1,088	1,018	501	353	4,948

Within "more than 5 years" there is a figure of £11,000 (2010 - £17,000) in respect of preference shares which
have no redemption date).
Ordinary Shares	Within	Within	Within	Within	Within	More than
	1 year	1-2 years	2-3 years	3-4 years	4-5 years	5 years	Total
At 31 December 2010	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Fixed interest
Listed	-	-	-	-	-	-	-
Unlisted	857	856	427	1,134	900	223	4,397
	857	856	427	1,134	900	223	4,397
S Ordinary Shares	Within	Within	Within	Within	Within	More than
	1 year	1-2 years	2-3 years	3-4 years	4-5 years	5 years	Total
At 31 December 2011	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Fixed interest
Listed	248	-	-	-	-	-	248
Unlisted	437	90	553	954	370	261	2,665
	685	90	553	954	370	261	2,913

Within "more than 5 years" there is a figure of £1,000 (2010 - £1,000) in respect of preference shares which
have no redemption date).
S Ordinary Shares	Within	Within	Within	Within	Within	More than
	1 year	1-2 years	2-3 years	3-4 years	4-5 years	5 years	Total
At 31 December 2010	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Fixed interest
Listed	-	-	-	-	-	-	-
Unlisted	403	579	116	540	845	150	2,633
	403	579	116	540	845	150	2,633

All liabilities are due within one year and, as such, no maturity profile has been provided.

Liquidity risk

Due to their nature, unlisted investments may not be readily realisable and therefore a portfolio of listed assets and cash is held to offset this liquidity risk.  Note 8 details the three-tier hierarchy of inputs used as at 31 December 2011 in valuing the Company's investments carried at fair value.

Credit risk and interest rate risk are minimised by acquiring high quality government treasury stocks or other bonds which have a relatively short time to maturity.

The Company, generally, does not hold significant cash balances and any cash held is with reputable banks with high quality external credit ratings.

Credit risk
This is the risk that a counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with the Company.
The Company's financial assets exposed to credit risk amounted to the following:
	31 December 2011				31 December 2010
	Ordinary Shares	S Ordinary Shares	Total		Ordinary Shares	S Ordinary Shares	Total
Investments in fixed interest instruments	597	248	845		-	-	-
Investments in unlisted debt securities	4,351	2,665	7,016		4,397	2,633	7,030
Cash and cash equivalents	399	356	755		890	753	1,643
	5,347	3,269	8,616		5,287	3,386	8,673

Credit risk arising on fixed interest instruments is mitigated by investing in UK Government Stock.

All assets which are traded on a recognised exchange, are held by JP Morgan Chase (JPM), the Company's custodian.  Cash balances are held by JPM and Clydesdale. Should the credit quality or the financial position of any of these institutions deteriorate significantly the Manager will move these assets to another financial institution.

The Manager evaluates credit risk on unlisted debt securities and financial commitments and guarantees prior to investment, and as part of the ongoing monitoring of investments.  In doing this, it takes into account the extent and quality of any security held.  Typically, unlisted debt securities have a fixed charge over the assets of the investee company in order to mitigate the gross credit risk.  The Manager receives management accounts from investee companies, and members of the investment management team sit on the boards of investee companies; this enables the close identification, monitoring and management of investment specific credit risk.

There were no significant concentrations of credit risk to counterparties at 31 December 2011 or 31 December 2010.

Price risk sensitivity

The following details the Company's sensitivity to a 10% increase or decrease in the market prices of listed or AIM/PLUS quoted securities, with 10% being the Manager's assessment of a reasonable possible change in market prices.

At 31 December 2011, if market prices of AIM/PLUS quoted securities had been 10% higher or lower and with all other variables held constant, the increase or decrease in net assets attributable to Ordinary Shareholders for the year would have been £94,000 (2010: £71,000) due to the change on valuation of financial assets at fair value through profit or loss.

At 31 December 2011, if market prices of listed or AIM/PLUS quoted securities had been 10% higher or lower and with all other variables held constant, the increase or decrease in net assets attributable to S Ordinary Shareholders for the year would have been £32,000 (2010: £16,200) due to the change on valuation of financial assets at fair value through profit or loss.

At 31 December 2011, 82.0% (2010: 78.4%) comprised investments in unquoted companies held at fair value attributable to Ordinary Shareholders.  The valuation methods used by the Company include cost and realisable value. Therefore, it is not considered meaningful to provide a sensitivity analysis on the net asset position and total return Therefore, it is not considered meaningful to provide a sensitivity analysis on the net asset position and total return for the year due to the fact any such movements would be immaterial to users of Financial Statements.

At 31 December 2011, 84.6% (2010: 79.9%) comprised investments in unquoted companies held at fair value attributable to S Ordinary Shareholders.  The valuation methods used by the Company include cost and realisable value. Therefore, it is not considered meaningful to provide a sensitivity analysis on the net asset position and total return for the year due to the fact any such movements would be immaterial to users of Financial Statements.

Other information

This announcement has been prepared on the same basis as the Annual Report and Financial Statements for the year ended 31 December 2011. The Annual Report and Financial Statements for the year ended 31 December 2011 will be filed with the Registrar of Companies and issued to Shareholders in due course. References to page numbers and notes to the financial statements are references to the Annual Report and Financial Statements for the year ended 31 December 2011.

The financial information contained within this announcement does not constitute the Company's statutory Financial Statements as defined in the Companies Act 2006. The statutory Financial Statements for the year ended 31 December 2010 have been delivered to the Registrar of Companies and contained an audit report which was unqualified.

Copies of this announcement and of the Annual Report and Financial Statements for the year ended 31 December 2011 will be available at the registered office: 149 St Vincent Street, Glasgow, G2 5NW, and on the Company's website at www.mavencp.com/migvct4.

By order of the Board

Maven Capital Partners UK LLP

Secretary

ENDS

Neither the content of the Company's website nor the contents of any website accessible from hyperlinks on the company's website (or any other website) is incorporated into, or forms part of, this announcement.

 

END

 

 

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