Half-year Report

RNS Number : 7971Y

Mobeus Income & Growth VCT PLC

11 September 2020

 

MOBEUS INCOME & GROWTH VCT PLC
HALF YEAR RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2020
Mobeus Income & Growth VCT plc ("the Company") today announces its half-year results for the six months ended 30 June 2020.
As at 30 June 2020: Net assets: £74.71 million Net asset value ("NAV") per share: 58.86 pence
Financial Highlights
Results for the six months ended 30 June 2020
· Net asset value total return1 per share was 0.1% for the six months.
· Share price total return1 per share fell by 5.1% for the six months.
· The Company declared an interim dividend in respect of the current year of 6.00 pence per share, paid to Shareholders on 7 May 2020.
· The Company realised investments for a total of £9.35 million, a gain of £1.99 million for the six months over their valuation at 31 December 2019.
· The Company invested £1.68 million into one new growth capital investment and two follow-on investments. 1 Alternative performance measure (APM). See glossary of terms on page 30 of the Half-Year Report.
Performance summary
The table below shows the recent past performance of the original fundraising launched in 2004. Performance data for all fundraising rounds and for former Matrix Income & Growth 3 VCT plc ("MIG3 VCT") shareholders are shown in the tables on pages 28 and 29 of the Half-Year Report and will be available on the Company's website.
Reporting date Net assets NAV per Share Share  Price  (mid-market price)1 Cumulative dividends paid per share Cumulative total return per share to shareholders2 Dividends per share declared in respect of the period (NAV basis) (Share price basis) As at (£m) (p) (p) (p) (p) (p) (p) 30 June 2020 74.71 58.86 50.50 134.80 193.66 185.30 6.003 31 December 2019 71.89 68.78 63.754 124.80 193.58 188.55 10.00 30 June 2019 77.13 73.00 61.50 118.80 191.80 180.30 4.00
1  Source: Panmure Gordon (mid-price). Note that the Share price at 30 June 2020 is by reference to the last announced NAV per share at 31 March 2020 of 52.78p (after adjusting for a 6.00 pence per share dividend paid in May 2020). 2  Cumulative total return per share comprises either the NAV per share (NAV basis) or the mid-market price per share (share price basis), plus cumulative dividends paid since launch in 2004. 3  The Directors declared an interim dividend of 6.00 pence per share in respect of the year ending 31 December 2020. The dividend was paid to Shareholders on 7 May 2020. 4  The share price has been adjusted for a 4.00 pence dividend paid after the year-end on 8 January 2020 which was ex-div at 31 December 2019.
Chairman's Statement I am pleased to present the Company's Half-Year Report for the six months ended 30 June 2020. Overview The 2020 half-year was preceded by a strong NAV total return of 13.6% for the year ended 31 December 2019. This excellent performance continued in the early part of 2020 with two profitable realisations, Biosite and Auction Technology Group, the latter of which was the Company's most successful exit in its history. Midway through this half-year, COVID-19 and the UK Government's lockdown measures provoked significant uncertainty and instability. This resulted in a significant dip in consumer and business confidence and the public markets saw a sharp fall for the first quarter of the year. Over this unprecedented time, the  Board has liaised closely with the Investment Adviser, Mobeus Equity Partners LLP ("Mobeus"), who responded well in ensuring that all practical steps were being taken to enable each company to trade through the crisis where possible and could seek to grow in value thereafter. Amongst many portfolio initiatives, all investee companies were alerted to, and some utilised, available government support packages. The Company also provided loan interest payment holidays to certain portfolio companies, generating vital cash headroom for them during the lockdown period. The immediate impact for Shareholders of the COVID-19 crisis was that a number of valuation adjustments were made at the end of March resulting in a fall of 8.7% in underlying NAV per share for the quarter to 58.78 pence. These adjustments were partly stock market related, but also partly in response to COVID-19's impact on specific market segments and investee companies. This fall in NAV was tempered by the beneficial impact of the sale of Auction Technology Group. In the second quarter, greater clarity has emerged on the impact of the crisis upon the portfolio. To date, this has been more modest than was initially expected and it has become apparent that there have been several portfolio beneficiaries arising from a structural change in activity, behaviour and consumer purchasing habits. Much of the portfolio has demonstrated a strong degree of resilience. Also, quoted stock markets have seen a significant rally since the March low point, although at the time of writing the FTSE-100 Index has still fallen by almost a fifth over the six months under review. Overall, the view of the Board and Mobeus is that the environment for our investee companies has been less volatile and less uncertain than initially thought, such that the valuation of the portfolio recovered strongly at the end of June. Over the six months to 30 June 2020, the NAV total return was stable which the Board considers a very creditable result in this environment. Further information is set out under Performance in my Statement below. A number of transactions occurred during the period. In the first quarter, the Company made two profitable portfolio realisations: Biosite and Auction Technology Group. The exit of Auction Technology Group generated the Company's highest absolute profit to date. In May, two follow-on investments were made into existing portfolio companies, Rotageek and MyTutor, and one new investment was made into Andersen EV in June. Since the period-end, a follow-on investment of £1.42 million was made in Buster and Punch Holdings Limited. Further details of the investment activity are contained in the Investment Adviser's Review. The Board is very encouraged by the recent profitable disposals, following the period-end, of Tovey Management (trading as Access IS) and Blaze Signs realising cash proceeds of £7.07 million and £1.98 million respectively, in what remains a challenging environment.  The impact of these realisations on the NAV per share of 58.86 pence at 30 June 2020 is estimated to be an increase of 1.71 pence per share. This is in isolation to any other matters that may affect NAV per share. Performance The Company's NAV total return per share was 0.1% for the six months to 30 June 2020 (2019: 11.0%). This NAV total return reflects a material recovery in NAV per share compared to that announced at the height of the pandemic as at 31 March 2020. The share price total return was a fall of 5.1% (2019: increase of 7.3%), at 30 June, mainly because the share price at 30 June is by reference to the 52.78 pence NAV per share at 31 March 2020 (after deducting a dividend of 6.00 pence per share paid in May 2020), and does not reflect the increase in NAV per share in the quarter to 30 June 2020. Although the NAV was reduced by falls in the valuations of specific portfolio companies, reflecting the impact of COVID-19, this adverse impact was partly offset by a number of factors. Positive returns came both from realised gains from portfolio exits as well as a strong revenue return. Several of the Company's investment structures incorporate a preference, such that any reduction in the value of the enterprise does not feed directly into the same reduction in the value of the Company's investment. In addition, the Company has significant liquidity which, in accordance with its policy, has been invested in lower risk liquidity funds and bank deposit accounts and these have retained their value. The Board therefore believes that the Company's performance has demonstrated a good degree of resilience over the half-year. At the period-end, your Company was ranked 12th out of 43 Generalist VCTs over five years and 2nd out of 31 over 10 years, in the Association of Investment Companies' analysis of NAV Cumulative Total Return. For further details on the performance of the Company, please refer to the Investment Adviser's Report on pages 5 to 8 and the longer-term Performance Data on pages 28 and 29 of the Half-Year Report. Dividends A further interim dividend for last year of 4.00 pence per share had been paid on 8 January 2020. On 2 April 2020, the Board declared an interim dividend of 6.00 pence per share in respect of the current financial year, paid to Shareholders on 7 May 2020, whose names were on the Register on 14 April 2020. Your Board has therefore already met the 4.00 pence per share annual dividend target in respect of the current financial year. However, the gradual move of the portfolio to growth capital investments may make the target more difficult to achieve in future financial years without recourse to the Company's reserves. Shareholders should note that there may continue to be circumstances where the Company is required to pay dividends in order to maintain its regulatory status as a VCT, for example, to stay above the minimum percentage of assets required to be held in qualifying investments.  Such dividends may cause the Company's NAV per share to reduce by a corresponding amount. Investment portfolio In the context of a very challenging business environment, the portfolio has performed comparatively well during this period. The overall value has decreased by £0.78 million (2019: £7.59 million increase), or -1.5% (2019: +15.7%), compared to the start of the year. This fall was comprised of a net unrealised decrease in valuations of £2.77 million, partially offset by £1.99 million in realised gains over the six-month period. Taking into account these realisations, new investments and valuation movements, the portfolio was valued at £43.25 million at the period-end (31 December 2019: £51.70 million). During the six-months under review, the Company invested a total of £1.68 million, (2019: £2.30 million) into one new and two existing investments. The existing investments were: ● MyTutor - A digital marketplace for school tutoring    £0.84 million ● Rotageek - A workforce management software provider    £0.57 million and the new investment was: ● Andersen EV - An electric vehicle charge point business    £0.27 million The Company realised investments in Pattern Analytics (trading as Biosite) and Turner Topco (trading as Auction Technology Group) during the period, which, combined with other capital receipts, generated total proceeds of £9.35 million. The realisation of Auction Technology Group achieved a substantial gain over cost and represented proceeds of £6.84 million and a gain of £1.88 million in the period. Over the 11½ year life of the investment, total proceeds of £14.77 million have been received, an overall multiple of over 4.5x original cost and an IRR of 29%. Pattern Analytics (trading as Biosite), an investment made after the 2015 rule change, was realised for proceeds of £2.34 million. Over the three-year life of the investment, this company generated a return on original cost of 1.5x and an IRR of 21%. Other capital proceeds of £0.17 million and realised gains of £0.11 million were principally generated from Redline Worldwide, an investment realised in a prior period and a loan repayment from BookingTek, an existing portfolio company. Following the period-end, there were additional realisations from: ● Access IS - £8.25 million cash proceeds received since investment equating to a 2.5x multiple of cost and an IRR of 23%; ● Blaze - £5.27 million cash proceeds received over the life of the investment; a 2.7x multiple of cost and an IRR of 14%. Details of this investment activity and the performance of the portfolio are contained in the Investment Adviser's Review and the Investment Portfolio Summary later in this announcement. Revenue account The results for the period are set out in the Unaudited Condensed Income Statement and show a revenue return (after tax) of 1.54 pence per share (2019: 0.92 pence per share). The revenue return for the period of £1.92 million has increased from last year's comparable figure of £0.98 million. This increase is mainly due to a significant receipt of loan interest, previously unrecognised, arising from the sale of Auction Technology Group, partially offset by a number of provisions against loan interest. Fundraising The Board was very pleased with the support in respect of the Company's Offer for Subscription which was launched on 25 October 2019. This Offer became fully subscribed within two months and raised £15.00 million in total.  The Company allotted a total of 23,233,293 shares of 1 penny each in the Company on 8 January and 2 April 2020. The Board extends a warm welcome to all new Shareholders. Shareholder Event The Investment Adviser held its annual Shareholder event on 4 February 2020 and is planning to hold a virtual event in the first quarter of 2021. Details will be notified to Shareholders once confirmed and will be shown on the Company's website:  www.migvct.co.uk. Share buybacks During the six months under review, the Company bought back and cancelled 840,716 of its own shares, representing 0.8% (2019: 1.2%) of the shares in issue at the beginning of the period, at a total cost of £0.42 million (2019: £0.76 million) inclusive of expenses. It is the Company's policy to cancel all shares bought back in this way. The Board regularly reviews its buyback policy and currently seeks to maintain the discount at which the Company's shares trade at no more than 5% below the latest published NAV. Liquidity Following the Company's successful fundraising and significant realisation proceeds, cash or near cash resources held by the Company as at 30 June 2020 was £31.77 million or 42.5% of net assets. After the period-end, following the realisations of Access and Blaze, and the further investment in Buster and Punch, the pro forma level of liquidity will be £39.41 million or 51.2% of net assets. The Board considers the Company to be in a strong cash position. Shareholder communications May I remind you that the Company has its own website which is available at www.migvct.co.uk containing useful information for Shareholders. Outlook The full impact of COVID-19 is still unclear and is likely to be felt for several years to come. Nevertheless, your Board considers that your Company is well positioned to cope with most of the likely scenarios in so far as they can presently be foreseen. The successful realisations and recent fundraising have given the Company strong liquidity not only to support the existing portfolio if appropriate and allowed by VCT regulations, but also to capitalise on opportunities which may arise for new investment. The portfolio comprises a foundation of mature investments that are still providing an income return, as well as a younger growth capital portfolio seeking to achieve scale, higher levels of profitability and hence value. The challenges arising from the COVID-19 pandemic should not be underestimated. However, once conditions stabilise, the Board and Mobeus believe that attractive new and follow-on investment opportunities will emerge and are pleased to see that some recovery has been achieved in the last quarter. As the world gradually returns to a new normal in the aftermath of COVID-19, attention may well return to Brexit and the degree to which the UK can reach agreements with the rest of the EU for tariff-free access to our respective markets. All the portfolio companies have been planning for that since before the COVID-19 pandemic took centre stage. Finally, I would like to take this opportunity once again to thank all Shareholders for their continued support. Clive Boothman Chairman 11 September 2020
Investment Policy The Investment Policy is designed to meet the Company's objective. Investments The Company invests primarily in a diverse portfolio of UK unquoted companies. Investments are made selectively across a number of sectors, principally in established companies. Investments are usually structured as part loan stock and part equity in order to produce a regular income stream and to generate capital gains from realisations. There are a number of conditions within the VCT legislation which need to be met by the Company and which may change from time to time. The Company will seek to make investments in accordance with the requirements of prevailing VCT legislation. Asset allocation and risk diversification policies, including the size and type of investments the Company makes, are determined in part by the requirements of prevailing VCT legislation. No single investment may represent more than 15% (by VCT tax value) of the Company's total investments at the date of investment. Liquidity The Company's cash and liquid funds are held in a portfolio of readily realisable interest bearing investments, deposit and current accounts, of varying maturities, subject to the overriding criterion that the risk of loss of capital be minimised. Borrowing The Company's articles of association permit borrowings of amounts up to 10% of the adjusted capital and reserves (as defined therein). However, the Company has never borrowed and the Board would only consider doing so in exceptional circumstances.
Investment Review COVID-19 Pandemic In March 2020, in response to the COVID-19 pandemic, the UK Government introduced lockdown and social distancing measures. These measures had an immediate adverse impact on UK businesses, with many companies experiencing a significant reduction in consumer and business demand. Businesses' ability to trade was further impacted by restrictions on their employees' working practices and disruption to their supply chains. The six months to 30 June 2020 have therefore been characterised by ongoing volatility and uncertainty caused by these lockdown measures, together with global stock market falls. Following the low point in March however, there has been a strong trend of recovery in stock market and business activity levels. Looking forward, there are still uncertainties ahead. The impact on transaction activity has been mixed. New investment activity has been low due to difficulties of appraisal and diligence in lockdown and owners of businesses being unwilling to accept downward price adjustments thus far. The level of portfolio follow-on investment has been higher and there are opportunities to back known portfolio companies that are achieving strong relative performance. The realisation activity outlook continues to be positive with several approaches received from trade and financial investors for a number of investee companies. Portfolio review Overall, the value of the portfolio decreased by £0.78 million over the period comprising a decrease of £2.77 million in the unrealised portfolio and gains of £1.99 million through realisations. This represents a recovery of the majority of the value lost in the first quarter. It is important to note that the usual approach to portfolio valuation by the Investment Adviser continued to be applied throughout this period and that the recovery in the second quarter was not all market related. It reflected a number of other factors such as earnings and revenues being more resilient than expected, the removal of provisions related to the uncertainty that were put in place during the March quarter, and improved cash generation as the UK Government lock down restrictions were eased. There have been a number of portfolio companies that have been clear beneficiaries from UK lockdown which have traded strongly throughout. There is a reasonable expectation that some of these gains will prove permanent. The majority of the portfolio has remained resilient, more so than first thought at the 31 March valuation point which coincided with the height of uncertainty. In particular, there have been very few COVID-19 closures, Tapas Revolution being the only temporary one of note.  Several portfolio companies that saw significant falls in activity early in the crisis are now trading strongly again whilst a number have raised capital to ensure that they are ready to capitalise on demand when it returns. In the six months to 30 June 2020, the Company made two follow-on investments of £0.84 million into MyTutor and £0.57 million into Rotageek. One new growth capital investment has also been made into Andersen EV of £0.27 million, a manufacturer of premium electric vehicle (EV) chargers. Following the period-end, there was an additional follow-on investment of £1.42 million into Buster and Punch. The Company realised its investments in Biosite and Auction Technology Group during the period, receiving a total of £9.18 million in proceeds from these realisations, which contributed to total receipts of £9.35 million during the period. The realisation of Biosite generated proceeds of £2.45 million over the life of the investment and contributed a gain over original cost of 1.5x. Auction Technology Group generated a realised gain in the period of £1.88 million and generated proceeds over the life of the investment of £14.77 million compared to an original cost of £3.27 million, a multiple on cost of 4.5x over the 11½ years this investment was held - an exceptional return for Shareholders. Following the period-end, there were additional realisations from Access IS and Blaze receiving a total of £9.05 million in cash proceeds. The gains from these will be reflected in the second half of the financial year. The investment portfolio's activity in the six months to 30 June 2020 is summarised as follows: 2020 £m 2019 £m Openingportfolio value 51. 70 48.49 Newandfollow-on investments 1. 68 2.30 Disposalproceeds (9.35) (10. 08) Netrealisedgains 1.99 2.33 V aluation movements (2.77) 5.26 Portfolio valueat 30June 43.25 48.30 The investment and divestment activity during the period has increased the proportion of the portfolio comprised of investments made since the change in the VCT rules to 52.2% by value at the period-end (31 December 2019: 45.2%). The portfolio decreased from 34 to 32 investments at the period end. The portfolio's contribution to the overall results of the Company for the six-month period is summarised as follows: InvestmentPortfolio CapitalMovement 2020 £m 2019 £m Increaseinthe valueofunrealised investments 4.59 6.54 Decreaseinthe valueofunrealised investments (7.36) (1.28) Net (decrease) / increase in the value of unrealised investments (2.77) 5.26 Realised gains 2. 05 2.33 Realised losses (0 . 06) - Netrealisedgainsin theperiod 1.99 2.33 Netportfolio movementinthe period (0 .78) 7 .59 Valuation changes of portfolio investments still held The valuation reductions of £2.77 million principally arise from the Investment Adviser's review of the portfolio and the impact of COVID-19. Within total valuation decreases, the main reductions were CGI Creative Graphics International - £1.44 million, Tapas Revolution - £1.35 million, and Media Business Insight - £0.97 million. These three companies saw some of the most significant impacts of a sudden decline in demand for their products or services which, even as restrictions are being eased, may take time for value to recover. By contrast, in 5 of the 32 investee companies, trading has benefited from the lockdown, being Access IS, Virgin Wines, MyTutor, Parsley Box and Bleach London. Within total valuation increases, the principal contributors were Access IS: £1.28 million, Virgin Wines: £0.90 million and, Parsley Box: £0.84 million. Access IS's valuation reflects the long-term nature of many of its projects. Both Virgin Wines and Parsley Box have generated record earnings and revenues respectively and time will tell if this increased demand will continue in the medium-term. The period also saw portfolio companies, Jablite and Super Carers, appointing administrators. These two companies were struggling before the impact of COVID-19. Valuation reductions for these companies had already been made, so there has been only a modest £0.06 million realised loss as a result of these administrations. Growth capital investing involves companies which often have not achieved profitability, and as a result, have to be measured on other metrics.  The table below shows the proportion of the portfolio that is represented by high growth but yet to be profitable companies (often valued by reference to revenue or gross profit multiple), compared with more mature, established companies with a history of profitability and which can therefore be valued on an earnings multiple. Valuation methodology 30 June 2020 £m 31 December 2019 £m Earnings multiple 20.34 30.94 Revenue multiple 19.84 14.14 Gross profit multiple 1.32 3.51 Recent investment price 0.27 2.98 Other 1.48 0.13 Total 43.25 51.70 Investment portfolio yield In the period under review, the Company received the following amounts in interest and dividend income: InvestmentPortfolio Yield 2020 £m 2019 £m Interestreceivedinthe period 2.39 1.20 Dividendsreceivedin theperiod 0.30 0.26 Total portfolioincome intheperiod1 2. 69 1.46 Portfolio valueat 30June 43.25 48.30 Portfolio Income Yield(Incomeforthe halfyearasa%of Portfoliovalueat 30June) 6.2% 3.0% 1 The increase in income was principally due to interest of £1.78 million received on the loan instruments in Auction Technology Group being paid, as part of the sale transaction, which had not previously been recognised. This income will not be repeated. New investments in the half-year The Company made one new investment during the period, as detailed below.
Company Business Date of Investment Amount of new investment (£m) Andersen EV E l ec tri c vehicle(EV) chargers June2020 0.27 Muller EV Limited (trading as Andersen EV) is a design-led manufacturer of premium electric vehicle (EV) chargers. Incorporated in 2016, this business has secured high profile partnerships with Porsche and Jaguar Land Rover, establishing an attractive niche position in charging points for the high end EV market. The Company's funds will be used to scale the business through investment in further products and software, sales and marketing and electric vehicle manufacturer partnerships. Andersen is well positioned in a nascent sector experiencing significant growth and has increased sales by over 350% for its most recent financial year.
Follow-on investments made in the half-year The Company made two follow-on investments totalling £1.41 million into existing portfolio companies in the period, as detailed below: Company Business Date of Investment Amount of new investment (£m) MyTutor Digital marketplace connecting school pupils seeking one-to- one online tutoring May 2020 0.84 MyTutorWeb Limited (trading as MyTutor) is a digital marketplace that connects school pupils who are seeking private one-to-one tutoring with university students. The business is satisfying a growing demand from both schools and parents to improve pupils' exam results to enhance their academic and career prospects. This further investment, alongside other existing shareholders, seeks to build and reinforce its position as a UK category leader in the online education market as well as to begin to develop a broader, personalised, learning product offering. The COVID-19 impact on the education sector has significantly heightened the awareness of online learning and tutoring. MyTutor has grown strongly over the last six months with average year-on-year revenue growth of 70%. Rotageek Workforce management software May 2020 0.57 Rota Geek Limited is a provider of cloud-based enterprise software to help larger retail leisure and healthcare organisations predict and meet demand to schedule staff more effectively. This investment will be used to capitalise on opportunities that will emerge as the retail sector recovers from lockdown restrictions. Rotageek has also moved into healthcare to help address the workforce management issues of a sector that has become chronically overburdened. For the year ended 31 December 2019, revenues have grown over 45% on the prior year.
Follow-on investments post the half-year After the period-end, the Company made one follow-on investment as detailed below: Company Business Date of Investment Amount of new investment (£m) Buster & Punch Lighting and interiors brand September 2020 1.42 Buster and Punch is a well-established, premium branded, fast growing business which designs and manufactures a complete range of high-quality functional fittings (lighting, electrical and hardware and other accessories) for the home. The VCT first invested in 2017 and since then, the business delivered consistent high growth across its ranges, with revenues growing in excess of 65%, and reaching nearly £10 million in 2020. Buster and Punch's products are now sold in 99 countries via both its highly invested ecommerce platform and direct services to consumers, trade and retailers across the world. Buster and Punch also operates flagship showrooms in London, Stockholm and Los Angeles. To support the continued growth of Buster and Punch, the new funding will be used to drive the global business plans of the fast-growing luxury interior fashion label with further expansion and strategic new penetration into the US and Asia Pacific markets.
Realisations in the half-year The Company realised two investments during the period, as detailed below: Company Business Period of investment Total cash proceeds over the life of the investment / Multiple over cost Biosite Workforcemanagement and secu rit y ser v i ces November2016 toFebruary 2020 £2.45 million 1.5 x cost The Company sold its investment in Biosite to ASSA ABLOY AB for £2.34 million. Since investment in 2016, the investment has generated proceeds of £2.45 million compared to an original investment cost of £1.58 million, which is a multiple on cost of 1.5x and an IRR of 21%. Auction Technology Group SaaS based online auction marketplace platform October 2008 to February 2020 £14.77 million 4.5 x cost The Company sold its investment in Auction Technology Group to TA Associates for £8.62 million (including £1.78 million loan interest due on completion). This investment generated proceeds of £14.77 million over the life of the investment compared to an original cost of £3.27 million, which is a multiple on cost of 4.5x and an IRR of 29%.
Realisations post the half-year Following the period end, there were additional realisations from Access ISand Blaze. Company Business Period of investment Total cash proceedsover thelifeofthe investment/ Multipleovercost A ccessIS Datacaptureandscanninghardware O c tober2015to August 2020 £ 8.25million 2.5xcost The Company sold its investment in Tovey Management Limited (trading as Access IS) to ASSA ABLOY AB for £7.04 million. Since investment in 2015, the investment has generated proceeds of £8.25 million compared to an original investment cost of £3.26 million, which is a multiple on cost of 2.5x and an IRR of 23%. Blaze Manufacturer and installer of signs April 2006 to September 2020 £5.27 million 2.7 x cost The Company sold its investment in Blaze Signs Holdings Limited via a secondary buy out backed by Elaghmore Advisor LLP and has received cash proceeds of £1.98 million. Over the 14 years this investment was held, cash proceeds of £5.27 million have been received compared to original cost of £1.95 million, which is a multiple of cost of 2.7x and an IRR of 14%.
Mobeus Equity Partners LLP  Investment Adviser  11 September 2020 Investment Portfolio Summary as at 30 June 2020 Qualifying  investments Market sector Dateof investment Total book cost £'000 V aluation £'000 Lik e for lik e valuation increase/ (decrease) overperiod1 %value ofnet assets Unquoted  investments Tovey ManagementLimited (tradingasAccessIS) Providerofdatacaptureandscanninghardware Electronic &electrical equipment Oct-15 2,979 5,715 27 . 1% 7.7 % VirginWinesHoldingCompanyLimited Onlinewineretailer Generalretailers Nov-13 2,439 4,029 28.8% 5.4% MPBGroupLimited Onlinemarketplaceforusedphotographicandvideoequipment Generalretailers Jun-16 1,900 3,640 5.1% 4.9% PreservicaLimited Sellerofproprietarydigitalarchivingsoftware Softwareand computerservices Dec-15 2,099 3,370 24. 6% 4.5% V ectair HoldingsLimited Designeranddistributorofwashroomproducts Supportservices Jan-06 138 2,434 (16.8)% 3.3% MyTutorwebLimited(tradingasMyTutor) Digitalmarketplaceconnectingschoolpupils seekingone-to-oneonlinetutoring Supportservices May-17 2,374 2,374 - 3.2% ProactiveGroupHoldingsInc Providerofmediaservicesandinvestor conferencesforcompaniesprimarilylistedon secondarypublicmarkets General financial  Jan-18 926 2,331 - 3.1% EO TH Limited(tradingasEquipOutdoor Technologies) Brandedoutdoorequipmentandclothing Generalretailers Oct-11 1, 000 2,203 (13.8)% 2.9% VianMarketingLimited (tradingasRedPaddleCo) Design,manufactureandsaleofstand-up paddleboardsandwindsurfingsails Leisure goods Jul-15 1, 189 1, 768 - 2.4% Parsley Box Limited Supplierofhomedeliveredambientreadymeals fortheelderly Generalretailers May-19 854 1, 744 93.8% 2.3% DataDiscoverySolutionsLimited(tradingas Active Navigation) Providerofglobalmarketleadingfileanalysis softwareforinformationgovernance,securityand compliance Softwareand computerservices Nov-19 1,413 1, 713 21.3% 2.3% BusterandPunchHoldingsLimited Industrialinspiredlightingandinteriorsretailer Generalretailers Mar-17 668 1,320 13.2% 1.8% R ota GeekLimited Workforce managementsoftware Supportservices A ug-18 1, 142 1,290 0.9% 1. 7% ArkkConsultingLimited(tradingasArkk Solutions) Providerofservicesandsoftwaretoenable organisationstoremaincompliantwithregulatory reporting requirements Softwareand computerservices May-19 1,447 1,270 (14. 0)% 1. 6% BleachLondonHoldingsLimited Haircolourantsbrand Generalretailers Dec-19 674 944 40.0 % 1.3% TharsternGroupLimited Softwarebasedmanagementinformationsystems Softwareand computerservices Jul-14 1,377 915 (34.4)% 1.2% IPVLimited Providerofmediaassetsoftware Softwareand computerservices Nov-19 890 890 - 1.2% BlazeSignsHoldingsLimited Manufacturerandinstallerofsigns Supportservices Apr-06 492 847 (19. 6)% 1. 1%
MediaBusinessInsightHoldingsLimited Apublishingandeventsbusinessfocusedonthe creativeproductionindustries										Media							Jan-15			2,518					806					(42.3)%				1. 1%
MasterRemoversGroup2019Limited (tradingasAnthonyWardThomas,Bishopsgate andAussieMan&Van) Aspecialistlogistics,storageandremovals business										Supportservices							Dec-14			419					536					(43.2)%				0 .7 %
ManufacturingServicesInvestmentLimited (tradingasWetsuitOutlet) Onlineretailerinthewatersportsmarket										Generalretailers							Jul-17			2,174					482					(31.1)%				0.6 %
K udos InnovationsLimited Onlineplatformthatprovidesandpromotes academicresearchdissemination										Supportservices							Nov-18			421					421					(36.3)%				0.6 %
MullerEVLimited(tradingasAndersenEV) Providerofpremiumelectricvehicle(EV)chargers										Electronic &electrical equipment							Jun-20			270					270					New investment				0.4%
CGICreativeGraphicsInternationalLimited Vinylgraphicstoglobalautomotive,recreational vehicleandaerospacemarkets										Generalindustrials							Jun-14			1,808					240					(85.7)%				0.3%
Spanish Restaurant Group Limited (formerly Ibericos Etc. Limited) (trading as Tapas Revolution) Spanishrestaurantchain										Travel &leisure							Jan-17			1,245					167					(89.0)%				0.2%
JabliteHoldingsLimited Manufacturerofexpandedpolystyreneproducts										Constructionand materials							Apr-15			502					66					(47.5)%				0 .1 %
Veritek GlobalHoldingsLimited Maintenanceofimagingequipment										Supportservices							Jul-13			2,045					-					-				0.0 %
RDLCorporationLimited R ecruitment consultantsforthepharmaceutical, businessintelligenceandITindustries										Supportservices							Oct-10			1,558					-					(100. 0)%				0.0 %
R acoon InternationalGroupLimited Supplierofhairextensions,haircareproductsand training										Personal goods							Dec-06			1,213					-					-				0.0 %
BookingT ek Limited Directbookingsoftwareforhotelgroups										Softwareand computer services							Oct-16			687					-					-				0.0 %
OakheathLimited(tradingasSuperCarers) (inliquidation) Onlineplatformthatconnectspeopleseeking homecarefromexperiencedindependentcarers										Supportservices							Mar-18			580					-					-				0.0 %
CBImportsGroupLimited (tradingasCountryBaskets) Importeranddistributorofartificialflowersand floralsundries										Generalretailers							Dec-09			350					-					-				0.0 %
Total   qualifying  investments																				39 ,791					41, 785									55.9%
Non-qualifying investments										Market sector							Dateof investment			Total book cost £'000					V aluation £'000					Lik e for lik e valuation increase/ (decrease) overperiod1				%value ofnet assets
MediaBusinessInsightLimited Apublishingandeventsbusinessfocusedonthe creativeproductionindustries										Media							Jan-15			765					512					7. 1 %				0 .7 %
ManufacturingServicesInvestmentLimited (tradingasWetsuitOutlet) Onlineretailerinthewatersportsmarket										Generalretailers							Jul-17			571					343					(40.0)%				0.5%
EO TH Limited(tradingasEquipOutdoor Technologies) Brandedoutdoorequipmentandclothing										Generalretailers							Oct-11			298					324					-				0.4%
Tovey ManagementLimited (tradingasAccessIS) Providerofdatacaptureandscanninghardware										Electronic & electrical eq uipment							Oct-15			285					285					-				0.4%
Total non-qualifyinginvestments																				1,919					1,464									2. 0%
Total investmentportfolio																				41,710					43,249									57 .9%
Currentassetinvestmentsand Cashatbankandinhand2																				31,774					31,774									42.5%
Total investments																				73,484					75, 023									100.4%
Otherassets																									249									0.4%
Currentliabilities																									(562)									(0.8)%
Netassets																									74,710									100.0%
Portfolio splitbytype
Investments made prior to 2015 V CT rule change																				21,375					20 , 682									47 .8%
Investments made after 2015 V CT rule change																				20 ,335					22,567									52.2%
Total InvestmentPortfolio																				41,710					43,249									100.0%
1 - This percentage change in 'like for like' valuations is a comparison of the 30 June 2020 valuations with the 31 December 2019 valuations (or where a new investment has been made in the period, the investment amount) having adjusted for partial disposals, loan stock repayments or new or new or follow-on investments in the period.
2 - Disclosed as Current Asset Investments and Cash at bank and in hand within Current assets in the Balance Sheet.
Statement of the Directors' Responsibilities  Responsibility statements In accordance with Disclosure and Transparency Rule (DTR) 4.2.10, Clive Boothman (Chairman), Bridget Guérin (Chairman of the Nomination & Remuneration and Management Engagement Committees), and Catherine Wall (Chairman of the Audit Committee), being the Directors of the Company, confirm that, to the best of their knowledge: a)  the condensed set of financial statements, which has been prepared in accordance with Financial Reporting Standard 104 "Interim Financial Reporting" gives a true and fair view of the assets, liabilities, financial position and profit of the Company, as required by DTR 4.2.10; b)  the Half-Year Management Report which comprises the Chairman's Statement, Investment Policy, Investment Review and Investment Portfolio Summary includes a fair review of the information required by DTR 4.2.7, being an indication of the important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; c)  a description of the principal risks and uncertainties facing the Company for the remaining six months is set out below, in accordance with DTR 4.2.7; and d)  there were no related party transactions in the first six months of the current financial year that are required to be disclosed in accordance with DTR 4.2.8. Principal risks and uncertainties In accordance with DTR 4.2.7, the Board confirms, that the principal risks and uncertainties facing the company have not changed materially since the publication of the Annual Report and Financial Statements for the year ended 31 December 2019 other than the risks arising from the COVID-19 pandemic, referred to in the Chairman's Statement and the Investment Advisor's Report, the impact of which has been reflected in the valuation of the Company's investment portfolio. The Board acknowledges that there is regulatory risk and continues to manage the Company's affairs in such a manner as to comply with section 274 of the Income Tax Act 2007. The principal risks faced by the Company are: · Economic; · Loss of approval as a Venture Capital Trust; · Investment and strategic; · Regulatory; · Financial and operating; · Valuations and stock market; · Asset liquidity; · Market liquidity; · Counterparty; and · Key staff. A detailed explanation of these risks can be found in the Strategic Report on pages 27 to 28 and in Note 15 on pages 62 - 68 of the Annual Report and Financial Statements for the year ended 31 December 2019, copies of which can be viewed or downloaded from the Company's website: www.migvct.co.uk. Going concern The Board has assessed the Company's operation as a going concern. The Company's business activities, together with the factors likely to affect its future development, performance and position are set out in the Half-Year Management Report. The Directors have satisfied themselves that the Company's cash position, bolstered by the recent fundraising and four disposals since the year-end, is adequate to enable the Company to continue as a going concern under any plausible stress scenario. The portfolio taken as a whole remains resilient and well-diversified although the impact of the COVID-19 pandemic is still being experienced. The major cash outflows of the Company (namely investments, share buy-backs and dividends) are within the Company's control. The Board's assessment of liquidity risk and details of the Company's policies for managing its capital and financial risks are shown in Notes 15 and 16 on pages 62 to 69 of the Annual Report and Financial Statements for the year ended 31 December 2019. Accordingly, the Directors continue to adopt the going concern basis of accounting in preparing the half-year report and annual financial statements. Cautionary statement This report may contain forward looking statements with regards to the financial condition and results of the Company, which are made in the light of current economic and business circumstances. Nothing in this report should be construed as a profit forecast. For and on behalf of the Board: Clive Boothman Chairman 11 September 2020
Unaudited Condensed Income Statement for the six months ended 30 June 2020
Six months ended 30 June 2019 (unaudited) Six months ended 30 June 2019  (unaudited) Notes Revenue Capital Total Revenue Capital Total £ £ £ £ £ £ Net investment portfolio (losses)/gains 9 - (787,177) (787,177) - 7,594,291 7,594,291 Income 4 2,770 , 006 - 2,770 , 006 1,561,649 - 1,561,649 Investment Adviser's fees 5 (214, 035) (642,106) (856, 141) (201,020) (603,058) (804,078) Other expenses (253,172) - (253,172) (205,390) - (205,390) Profit/(loss) on ordinary activities before taxation 2,302,799 (1,429,283) 873,516 1,155,239 6,991,233 8,146,472 Tax on profit on ordinary activities 6 (380,390) 122, 000 (258,390) (171,952) 114,581 (57,371) Profit/(loss) and total comprehensive income 1,922,409 (1,307 ,283) 615,126 983,287 7,105,814 8,089,101 Basic and diluted earnings per share 7 1.54p (1. 05)p 0.49p 0.92p 6.69p 7.61p Year ended 31 December 2019 (audited) Notes Revenue Capital Total £ £ £ Unrealised gains on investments - 9 ,144,246 9 ,144,246 Income 4 2,854,837 - 2,854,837 Investment Adviser's fees 5 (406,306) (1,218,918) (1,625,224) Other expenses (411, 005) - (411, 005) Profit on ordinary activities before taxation 2,037,526 7,925,328 9,962,854 Tax on profit on ordinary activities 6 (293,485) 231,594 (61,891) Profit for the year and total comprehensive income 1,744,041 8,156,922 9,900,963 Basic and diluted earnings per share 7 1.65p 7.71p 9.36p
The revenue column of the Income Statement includes all income and expenses. The capital column accounts for the net investment portfolio (losses)/gains (unrealised (losses)/gains and realised gains on investments) and the proportion of the Investment Adviser's fee charged to capital. The total column is the Statement of Total Comprehensive Income of the Company prepared in accordance with Financial Reporting Standards ("FRS"). In order to better reflect the activities of a VCT and in accordance with the 2014 Statement of Recommended Practice ("SORP") updated in October 2019 by the Association of Investment Companies ("AIC"), supplementary information which analyses the Income Statement between items of a revenue and capital nature has been presented alongside the Income Statement. The revenue column of profit attributable to equity Shareholders is the measure the Directors believe appropriate in assessing the Company's compliance with certain requirements set out in Section 274 Income Tax Act 2007. All the items in the above statement derive from continuing operations of the Company. No operations were acquired or discontinued in the period/year.
Unaudited Condensed Balance Sheet as at 30 June 2020
Company registration number: 05153931
															30June2020 (unaudited)							30June2019 (unaudited)											31December2019 (audited)
											Notes				£							£											£
Fixed assets
Investmentsatfairvalue											9				43,248,661							48,296,028											51, 703, 161
Currentassets
Debtorsandprepayments															249 ,195							243,315											225,562
Currentassetinvestments											10				28,570,843							19,902,109											12,914,124
Cashatbank											10				3,203,047							9 , 074,632											7,261,618
															32,023,085							29,220 , 056											20 ,401,304
Creditors:amountsfallingduewithinoneyear															(561,945)							(387 , 090)											(216, 090)
Netcurrentassets															31,461,140							28,832,966											20 ,185,214
Netassets															74, 709 ,801							77,128,994											71,888,375
Capitalandreserves
Calledupsharecapital															1,269, 191							1,056,569											1, 045,265
Capitalredemptionreserve															19,711							44,644											11,304
Sharepremiumreserve															14,397 ,509							43,669,335											-
Revaluation reserve															3,767,953							7 , 777,490											8,719, 606
Specialdistributablereserve															31,759,150							7,984,414											45, 731,919
Realised capitalreserve															19,722,344							13,920 ,908											14,528,747
Revenue reserve															3,773,943							2,675,634											1,851,534
EquityShareholders'funds															74, 709 ,801							77,128,994											71,888,375
Basicanddilutednetassetvaluepershare											11				58.86p							73. 00p											68.78p
The financial information for the six months ended 30 June 2020 and the six months ended 30 June 2019 has not been audited.
Unaudited Condensed Statement of Changes in Equity for the six months ended 30 June 2020
Notes					Non-distributable reserves															Distributable reserves
					Called up share capital £			Capital redemption reserve £				Share premium reserve £				Revaluation reserve £				Special distributable reserve (Note a) £							Realised capital reserve (Note b) £				Revenue reserve				Total £
At 1January2020					1,045,265			11,304  -								8, 719, 606				45, 731,919						14,528,747					1,851,534				71,888,375
Comprehensive  income
fortheperiod
(Loss)/profit fortheperiod					-			-  -								(2,777,454)				-						1,470,171					1,922,409				615,126
Total comprehensive incomefortheperiod					-			-  -								(2,777 ,454)				-						1,470,171					1,922,409				615,126
Contributionsbyand																				-						-					-				15, 000 , 000
distributionstoowners
SharesissuedviaOffer
forSubscription(Notec)					232,333			-				14, 767 , 667				-
Issuecostsand
facilitationfeesonOffer
forSubscription(Notec)					-			-    (370,158)								-				(152,153)						-					-				(522,311)
Sharesbought
back(Noted)					(8,407)			8,407  -								-				(424, 741)						-					-				(424, 741)
Dividendspaid		8			-			-    -								-				(11,846, 648)						-					-				(11,846, 648)
Total contributions byanddistributions toowners					223,926			8,407  14,397,509								-				(12,423,542)						-					-				2,206,300
Othermovements																				(1,549,227)						1,549,227					-				-
Realised losses
transferredtospecial
reserve(Notea)					-			-				-				-
Realisation ofpreviously
unrealisedgains					-			-  -								(2, 174, 199)				-						2,174,199					-				-
Total othermovements					-			-  -								(2, 174,199)				(1,549 ,227)						3, 723,426					-				-
At 30June2020					1,269,191			19,711   14,397,509								3,767 ,953				31, 759 ,150						19,722,344					3, 773,943				74, 709 ,801
Note a: The purpose of this reserve is to fund market purchases of the Company's own shares, to write off existing and future losses and for any other corporate purpose. The transfer of £1,549,227 to the special reserve from the realised capital reserve above is the total of realised losses incurred by the Company in the period. As at 30 June 2020, the Company has a special reserve of £31,759,150, of which £7,553,664 arises from shares issued more than three years after the end of the financial year in which they were issued. Reserves originating from share issues are not distributable under VCT rules if they arise from share issues that are within three years of the end of an accounting period in which shares were issued. Note b: The Realised capital reserve and the Revenue reserve together comprise the Profit and Loss Account of the Company. Note c: Under the Company's Offer for Subscription launched on 25 October 2019, 23,233,293 Ordinary Shares were allotted between 8 January 2020 and 2 April 2020, raising net funds of £14,477,689 for the Company. This figure is net of issue costs of £370,158 and facilitation fees of £152,153. Note d: During the period, the Company repurchased 840,716 of its own shares at the prevailing market price for a total cost of £424,741, which were subsequently cancelled. This figure is £42,866 more than that shown in the Unaudited Statement of Cash flows due to a creditor held at the period-end.
Unaudited Condensed Statement of Changes in Equity for the six months ended 30 June 2019
Notes				Non-distributable reserves															Distributable reserves
				Called up share capital £			Capital redemption reserve £				Share premium reserve £				Revaluation reserve £				Special distributable reserve (Note a) £				Realised capital reserve (Note b) £					Revenue reserve						Total £
At 1January2019				1, 068, 659			32, 191				43,644,698				5,285,632				12,681,614					8,818,475					3,546, 713					75,077 ,982
Comprehensive
incomefortheperiod
Profitfortheperiod				-			-				-				5,262,037				-					1,843,777					983,287					8,089 ,101
Total comprehensive incomefortheperiod				-			-				-				5,262,037				-					1,843,777					983,287					8,089 ,101
Contributions by and																			-					-					-					25,000
distributions to owners
Sharesissuedpursuant
toapplication				363			-				24,637				-
Sharesboughtback				(12,453)			12,453				-				-				(764,900)					-					-					(764,900)
Dividendspaid	8			-			-				-				-				(3,443,823)					-					(1,854,366)					(5,298, 189)
Total contributions byanddistributions toowners				(12, 090)			12,453				24,637				-				(4,208, 723)										(1,854,366)					(6, 038,089)
Othermovements																			(488,477)					488,477										-
Realised losses
transferredto
specialreserve				-			-				-				-
Realisation ofpreviously
unrealisedgains				-			-				-				(2,770 ,179)				-					2,770 , 179					-					-
Total othermovements				-			-				-				(2,770 ,179)				(488,477)					3,258, 656					-					-
At 30June2019				1, 056,569			44, 644				43,669,335				7,777 ,490				7,984,414					13,920 ,908					2,675,634					77,128,994
The composition of each of these reserves is explained below: Called up share capital - The nominal value of shares originally issued increased for subsequent share issues either via an Offer for Subscription or reduced due to shares bought back by the Company. Capital redemption reserve - The nominal value of shares bought back and cancelled is held in this reserve, so that the Company's capital is maintained. Share premium reserve - This reserve contains the excess of gross proceeds less issue costs over the nominal value of shares allotted under recent Offers for Subscription. Revaluation reserve - Increases and decreases in the valuation of investments held at the period-end are accounted for in this reserve, except to the extent that the diminution is deemed permanent. In accordance with stating all investments at fair value through profit and loss, all such movements through both revaluation and realised capital reserves are shown within the Income Statement for the period. Special distributable reserve - This reserve is created from cancellations of the balances upon the Share premium reserve, which are transferred to this reserve from time to time. The cost of share buybacks and any realised losses on the sale or impairment of investments (excluding transaction costs) are charged to this reserve. 75% of the Investment Adviser fee expense, and the related tax effect, that are charged to the realised capital reserve. This reserve will also be charged any facilitation payments to financial advisers, which arose as part of the Offer for Subscription.
Realised capital reserve - The following are accounted for in this reserve: ● Gains and losses on realisation of investments; ● Permanent diminution in value of investments; ● Transaction costs incurred in the acquisition and disposal of investments; ● 75% of the Investment Adviser fee expense and 100% of any performance incentive fee payable, together with the related tax effect to this reserve in accordance with the policies; and ● Capital dividends paid. Revenue reserve - Income and expenses that are revenue in nature are accounted for in this reserve together with the related tax effect, as well as income dividends paid that are classified as revenue in nature.
Unaudited Condensed Statement of Cash Flows for the six months ended 30 June 2020
													Sixmonthsended 30June2020 (unaudited)								Sixmonthsended 30June2019 (unaudited)											Year ended 31December2019 (audited)
									Notes				£								£											£
Cashflowsfromoperatingactivities
Profitaftertaxforthefinancialperiod													615,126								8, 089 , 101											9,900,963
Adjustmentsfor:
Netinvestmentportfoliolosses/(gains)													787 ,177								(7,594,291)											(9 ,144,246)
Tax chargeforcurrentperiod									6				258,390								57 ,371											61,891
(Increase)/decreaseindebtors													(23,667)								331, 692											285,660
Increase/(decrease)increditorsandaccruals													44,458								49,449											(17 ,589)
Netcashinflowfromoperations													1, 681,484								933,322											1, 086,679
Corporation  tax  refunded/(paid)													175								-											(108,482)
Netcashinflowfromoperatingactivities													1,681, 659								933,322											978, 197
Cashflowsfrominvestingactivities
Purchasesofinvestments									9				(1, 680 ,145)								(2,300,908)											(5,853,554)
Disposalsofinvestments									9				9,347,468								10,013,168											11, 772,421
Decrease/nochangeinbankdeposits withamaturityoverthreemonths													769								24											-
Netcashinflowfrom investingactivities													7, 668, 092								7,712,284											5,918,867
Cashflowsfromfinancingactivities
SharesissuedaspartofOfferforsubscription													15, 000 , 000								25,000											25,000
Issuecostsandfacilitationfeesas partofOfferforsubscription													(522,311)								-											-
Equitydividendspaid									8				(11,846, 648)								(5,298,189)											(11, 622, 745)
Sharecapitalboughtback													(381,875)								(887,442)											(1, 615,367)
Netcashinflow/(outflow)from financingactivities													2,249 ,166								(6,160,631)											(13,213,112)
Netincrease/(decrease)incashandcash equivalents													11,598,917								2,484,975											(6,316, 048)
Cashandcashequivalentsatstartofperiod													19, 170 , 060								25,486,108											25,486,108
Cashandcashequivalentsatendofperiod													30 , 768,977								27 ,971, 083											19,170, 060
Cashandcashequivalentscomprise:
Cashatbankandinhand									10				3,203,047								9 , 074,632											7,261,618
Cashequivalents									10				27,565,930								18,896,451											11,908,442
Notes to the Unaudited Condensed Financial Statements for the six months ended 30 June 2020
1.  Company information Mobeus Income and Growth VCT plc is a public limited company incorporated in England, registration number 5153931. The registered office is 30 Haymarket, London, SW1Y 4EX. 2.  Basis of preparation of the Financial Statements These Financial Statements are prepared in accordance with accounting policies consistent with Financial Reporting Standard 102 ("FRS 102"), Financial Reporting Standard 104 ("FRS 104") - Interim Financial Reporting, with the Companies Act 2006 and the 2014 Statement of Recommended Practice, 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' ('the SORP') (updated in October 2019) issued by the Association of Investment Companies ("AIC"). The Half-Year Report has not been audited, nor has it been reviewed by the Auditor pursuant to the Financial Reporting Council's (FRC) guidance on Review of Interim Financial Information. 3.  Principal accounting policies The accounting policies have been applied consistently throughout the period. Full details of principal accounting policies will be disclosed in the Annual Report, while the policy in respect of investments is included at the top of note 9 on investments. 4.  Income Sixmonthsended 30June2020 (unaudited) Sixmonthsended 30June2019 (unaudited) Year ended 31December2019 £ £ £ Dividends 300,003 260 ,215 505,401 Money-market funds 61, 670 81,840 151,532 Loan stockinterest 2,393,778 1, 196,940 2, 161,352 Bankdepositinterest 10,974 15,776 29 , 674 Interestonpreferencesharedividendarrears 726 6,878 6,878 Otherincome 2,855 - - Total Income 2,770, 006 1,561, 649 2,854,837 5.  Investment Adviser's fees
In accordance with the policy statement published under "Management and Administration" in the Company's prospectus dated 9 July 2004, the Directors have charged 75% of the Investment Adviser's fees to the capital reserve. This is in line with the Board's expectation of the long-term split of returns from the investment portfolio of the Company. For further details, see note 4a on page 52 of the 2019 Annual Report. Sixmonthsended 30June2020 Sixmonthsended 30June2019 Year ended 31December2019 £ £ £ Allocatedtorevenuereturn:InvestmentAdviser'sfees 214, 035 201, 020 406,306 Allocatedtocapitalreturn:InvestmentAdviser'sfees 642,106 603,058 1,218,918 Total Income 856, 141 804,078 1, 625,224   Between 1 July 2020 and 30 June 2021, the Investment Adviser's fee upon the net funds raised from the use of the over-    allotment facility of £5 million under the 2019/20 Offer will be reduced to 1% from 2% per annum, for one year. Between 1 April 2018 and 31 March 2019, the Investment Adviser's fee upon the net funds raised from the use of the over- allotment facility of £10 million under the 2017/18 Offer was reduced to 1% from 2% per annum, for one year.
Between 1 April 2018 and 31 March 2019, the Investment Adviser's fee upon the net funds raised from the use of the overallotment facility of £10 million under the 2017/18 Offer was reduced to 1% from 2% per annum, for one year. 6.  Taxation  There is a tax charge for the period as the Company has taxable income in excess of deductible expenses . R evenue £ Sixmonthsended 30June2020 (unaudited) Capital  Total £ £ R evenue £ Sixmonthsended 30June2019 (unaudited) Capital  Total   Revenue £ £ £ Year ended 31December2019 (audited) Capital  Total £ £ a)Analysisoftaxcharge: UKCorporationtaxonprofitfor theperiod 380,390 (122, 000) 258,390 171,952 (114,581) 57 ,371 293,485 (231,594) 61,891 Total currenttaxcharge/(credit) 380,390    (122,000) 258,390 171,952 (114,581) 57 ,371 293,485   (231,594) 61,891 Corporationtaxisbasedonarate 2,302,799 (1,429,283) 873,516 1, 155,239 6,991,233 8,146,472 2,037,526 7,925,328 9,962,854 of19.0%(2019:19.0%) b)Profitonordinaryactivities beforetax Profitonordinaryactivities multipliedbyrateofcorporation taxintheUKof19.0%(2019:19.0%) 437,532 (271,564) 165,968 219,495 1,328,334 1,547 ,829 387 ,129 1,505,813 1,892,942 Effectof: UKdividends (57,001) - (57,001) (49 ,441) - (49 ,441) (96,026) - (96,026) Netinvestmentportfoliolosses/ (gains)notallowable/(taxable) - 149,564 149,564 - (1,442,915) (1,442,915) - (1, 737,407) (1, 737,407) Unrelievedexpenditure - - - 1,898 - 1,898 2,382 - 2,382 Underprovisioninpriorperiod (141) - (141) - - - - - - Actualcurrenttaxcharge 380,390 (122, 000) 258,390 171,952 (114,581) 57 ,371 293,485 (231,594) 61,891
Over provision in prior period			(141)			-				(141)				-				-			-						-				-			-
Actual current tax charge			380,390			(122,000)				258,390				171,952				(114,581)			57,371						293,485				(231,594)			61,891

7.  Basic and diluted earnings per share

The basic and diluted earnings, revenue return and capital return per share shown below for each period are respectively based on numerators i)-iii), each divided by the weighted average number of shares in issue in the period - see iv) below.

Sixmonthsended 30June2020 (unaudited) Sixmonthsended 30June2019 (unaudited) Year ended 31December2019 (audited) £ £ £ i)Total  earnings  after  taxation 615,126 8, 089 ,101 9,900,963 Basicanddilutedearningspershare(Notea) 0.49p 7 . 61p 9.36p ii)  Revenueearningsfromordinaryactivitiesaftertaxation 1,922,409 983,287 1, 744, 041 Basicanddilutedrevenueearningspershare(Noteb) 1.54p 0.92p 1. 65p Netinvestment portfolio (losses)/gainsoninvestments (787,177) 7,594,291 9 ,144,246 CapitalInvestmentAdviser'sfeeslesstaxation (520 ,106) (488,477) (987,324) iii)Total   capital  earnings (1,307 ,283) 7,105,814 8,156,922 Basicanddilutedcapitalearningspershare(Notec) (1. 05)p 6.69p 7.71p iv)Weightedaveragenumberofsharesinissueinthe period 124, 645,269 106,355,772 105, 785, 777 Notes: a)  Basic earnings per share is total earnings after taxation divided by the weighted average number of shares in issue. b)  Basic revenue earnings per share is the revenue earnings after taxation divided by the weighted average number of shares in issue. c)  Basic capital earnings per share is the total capital earnings after taxation divided by the weighted average number of shares in issue.

8.  Dividends paid Dividend Type Fortheyear ended 31 December P ence pershare Datepaid Sixmonths ended 30June 2020 (unaudited) Sixmonths ended 30June 2019 (unaudited) Year ended 31December 2019 (audited) £ £ £ Final Income 2018   1. 75p 17May2019 - 1,854,366 1,854,366 Final Capital 2018 3.25p* 17May2019 - 3,443,823 3,443,822 Interim Income 2019   1.50p 20September2019 - - 1,584,854 Interim Capital 2019 2.50p* 20September2019 - - 2,641,423 Interim Capital 2019 2.00p* 6December2019 - - 2,098,280 Interim Capital 2019 4.00p* 8January2020 4, 181, 060 - - Interim Capital 2020 6.00p* 7May2020 7 , 665,588 - - 11,846, 648 5,298, 189 11, 622,745 * These dividends were paid out of the Company's special distributable reserve.

9.  Summary of movement on investments during the period The most critical estimates, assumptions and judgements relate to the determination of the carrying value of investments at "fair value through profit and loss" (FVTPL). All investments held by the Company are classified as FVTPL and measured in accordance with the International Private Equity and Venture Capital Valuation ("IPEV") guidelines, as updated in December 2018. This classification is followed as the Company's business is to invest in financial assets with a view to profiting from their total return in the form of capital growth and income. Purchases and sales of unlisted investments are recognised when the contract for acquisition or sale becomes unconditional. For investments actively traded on organised financial markets, fair value is generally determined by reference to Stock Exchange market quoted bid prices at the close of business on the balance sheet date. Purchases and sales of quoted investments are recognised on the trade date where a contract of sale exists whose terms require delivery within a time  frame determined by the relevant market. Where the terms of the disposal state that consideration may be received at some future date and, subject to the conditionality and materiality of the amount of deferred consideration, an estimate of the fair value, discounted for the true value of money, may be recognised through the Income Statement. In other cases, the proceeds will only be recognised once the right to receive payment is established and there is no reasonable doubt that payment will be received. Unquoted investments are stated at fair value by the Directors at each measurement date in accordance with appropriate valuation techniques, which are consistent with the IPEV guidelines:- (i)  Each investment is considered as a whole on a 'unit of account' basis, i.e. that the value of each portfolio company is considered as a whole, alongside consideration of:- The price of new or follow on investments made, if deemed to be made as part of an orderly transaction, are considered to be at fair value at the date of the transaction. The inputs that derived the investment price are calibrated within individual valuation models and at subsequent quarterly measurement dates are reconsidered for any changes in light of more recent events or changes in the market performance of the investee company. The valuation bases used are the following:

-  a multiple basis. The enterprise value of the investment may be determined by applying a suitable price-earnings ratio, revenue or gross profit multiple to that company's historic, current or forecast post-tax earnings before interest and amortisation, or revenue, or gross profit (the ratio used being based on a comparable sector but the resulting value being adjusted to reflect points of difference identified by the Investment Adviser compared to the sector including, inter alia, a lack of marketability). or:- -  where a company's underperformance against plan indicates a diminution in the value of the investment, provision against the price of a new investment is made, as appropriate. (iI) Premiums, to the extent that they are considered capital in nature, and that they will be received upon repayment of loan stock investments are accrued at fair value when the Company receives the right to the premium and when considered recoverable. (iII) Where a multiple or the price of recent investment less impairment basis is not appropriate and overriding factors apply, a discounted cash flow, net asset valuation, realisation proceeds or a weighted average of these bases may be applied. Capital gains and losses on investments, whether realised or unrealised, are dealt with in the profit and loss and revaluation reserves and movements in the period are shown in the Income Statement. All investments are initially recognised and subsequently measured at fair value. Changes in fair value are recognised in the Income Statement. A key judgement made in applying the above accounting policy relates to investments that are permanently impaired. Where the value of an investment has fallen permanently below the price of recent investment, the loss is treated as a permanent impairment and as a realised loss, even though the investment is still held. The Board assesses the portfolio for such investments and, after agreement with the Investment Adviser, will agree the values that represent the extent to which an investment loss has become realised. This is based upon an assessment of objective evidence of that investment's future prospects, to determine whether there is potential for the investment to recover in value. Accounting standards classify methods of fair value measurement as Levels 1,2 and 3.  This hierarchy is based upon the reliability of information used to determine the valuation.  All of the unquoted investments are Level 3, i.e. fair value is measured using techniques using inputs that are not based on observable market data.  Notes to the Unaudited Condensed Financial Statements  for the six months ended 30 June 2020

Unquoted equity shares Level 3 Unquoted preference shares Level 3 Unquoted loanstock Level 3 Total £ £ £ £ V aluation at 1 January2020 30 ,967 ,137 27,420 20 , 708,604 51, 703, 161 Purchasesatcost 1,437,325 - 242,820 1, 680 ,145 Sales-proceeds (5,941,887) - (3,405,581) (9,347,468) Netrealisedgains/(losses)(Notea) 1,905,594 (302) 84,985 1,990,277 Netunrealisedgains/(losses)oninvestments(Notea) 1,562,089 - (4,339,543) (2,777,454) V aluation at30June2020 29,930,258 27 , 118 13,291,285 43,248, 661 Bookcostat30June2020 24,024,389 27 , 108 17, 658, 009 41, 709,506 Permanent impairmentinvalueofinvestments (2,228,496) (302) - (2,228,798) Unrealisedgains/(losses)at30June2020 8,134,365 312 (4,366,724) 3,767,953 V aluation at30June2020 29,930,258 27 , 118 13,291,285 43,248, 661 Gainsoninvestments Netrealisedgains/(losses)basedonhistoricalcost 4,162,412 (302) 2,366 4,164,476 Less amountsrecognisedasunrealised (gains)/lossesinpreviousyears (2,256,818) - 82,619 (2, 174,199) Netrealisedgains/(losses)basedon carryingvalueat31December2019 1,905,594 (302) 84,985 1,990,277 Netmovementinunrealisedgains/(losses)intheperiod 1,562,089 - (4,339,543) (2,777,454) Netinvestmentportfoliogains/(losses) fortheperiodended30June2020 3,467 , 683 (302) (4,254,558) (787,177) Note a) Net realised gains on investments of £1,990,277 together with net unrealised losses of £2,777,454 equal net investment portfolio losses of £787,177 as disclosed in the Income Statement. There has been no significant change in the risk analysis as disclosed in Note 15 of the Financial Statements in the Company's Annual Report. The decrease in unrealised valuations of the loan stock investments above reflect the changes in the entitlement to loan premiums, and/or in the underlying enterprise value of the investee company. The decrease does not arise from assessments of credit or market risk upon these instruments. Level 3 unquoted equity and loan investments are valued in accordance with IPEV guidelines as follows: Asat 30June2020 (unaudited) £ Asat 30June2019 (unaudited) £ Asat 31December2019 (audited) £ Multipleofearnings,revenue,or grossmargin,asappropriate 41,503,626 45,494,032 48, 600 ,751 Net  asset value 1,409,041 163,390 125,484 Recent investmentprice 269,800 2,300,908 2,976,926 Estimatedrealisationproceeds 66,194 192, 693 - Recent investmentprice(reviewedforimpairment) - 145, 005 - Total 43,248, 661 48,296,028 51, 703, 161

10.  Current asset investments and cash at bank Asat 30June2020 (unaudited) £ Asat 30June2019 (unaudited) £ Asat 31December2019 (audited) £ OEICMoneymarketfunds 27,565,930 18,896,451 11,908,442 CashequivalentsperStatementofCashFlows 27,565,930 18,896,451 11,908,442 Bankdepositsthatmatureafterthreemonths 1,004,913 1, 005,658 1, 005,682 Currentassetinvestments 28,570 ,843 19 ,902, 109 12,914,124 Cashatbank 3,203,047 9 ,074, 632 7,261,618

11.  Basic and diluted net asset value per share Asat 30June2020 (unaudited) Asat 30June2019 (unaudited) Asat 31December2019 (audited) Netassets £74, 709 ,801 £77,128,994 £71,888,375 Numberofsharesinissue 126,919, 084 105,656,926 104,526,507 Basicanddilutednetassetvaluepershare(pence) 58.86p 73. 00p 68.78p

12.  Post balance sheet events On 14 August 2020, the Company realised its investment in Tovey Management Limited (trading as Access IS) generating proceeds of £7.04 million. On 1 September 2020, the Company invested a further £1.42 million into Buster and Punch Holdings Limited, an existing portfolio company. On 2 September 2020, the Company realised its investment in Blaze Signs Holdings Limited generating cash proceeds of £1.98 million. 13.  Financial statements for the period ended 30 June 2020 The information for the six months ended 30 June 2020 does not comprise statutory accounts within the meaning of Section 434 of the Companies Act 2006. The Financial Statements for the year ended 31 December 2019 have been filed with the Registrar of Companies. The auditor has reported on these Financial Statements and that report was unqualified and did not contain a statement under section 498(2) or (3) of the Companies Act 2006. 14.  Half-Year Report This Half-Year Report will shortly be made available on our website: www.migvct.co.uk and will be circulated by post to those Shareholders who have requested copies of the Report. Further copies are available free of charge from the Company's registered office, 30 Haymarket, London, SW1Y 4EX or can be downloaded via the website.

Contact details for further enquiries: Mobeus Equity Partners LLP (the Company Secretary) on 020 7024 7600 or by e-mail to [e-mail] Mobeus Equity Partners LLP (the Investment Adviser) on 020 7024 7600 or by e-mail to [e-mail] DISCLAIMER Neither the contents 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.

 

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