Half Yearly Report

RNS Number : 0861P

Mobeus Income & Growth VCT PLC

13 August 2014

 



13 AUGUST 2014

Mobeus Income & Growth VCT plc

Half-Yearly results for the six months ended 30 June 2014

Mobeus Income & Growth VCT plc ("the VCT", "the Company" or "MIG VCT") is a Venture Capital Trust ("VCT") listed on the London Stock Exchange.  Its investment portfolio, which invests primarily in established and profitable unquoted companies, is advised by Mobeus Equity Partners LLP ("Mobeus" or "the Investment Adviser").

Company Objective

The Company's Objective is to provide investors with a regular income stream, by way of tax-free dividends generated from income and capital returns.

FINANCIAL HIGHLIGHTS

Results for the six months ended 30 June 2014

-	Net asset value (NAV) total return per share for the period was 12.4%.
-	£10.67 million of net cash proceeds were receivable during the period which included the partial sale of ATG Media and the full disposal of each of MachineWorks and Monsal, together with various loan stock repayments.
-	An interim dividend of 17.00 pence per share has been declared, the magnitude of which largely reflects the exceptional level of capital gains realised in this six month period. This dividend will bring cumulative dividends paid to shareholders since launch to 64.30 pence per share.
-	A total of £3.03 million was invested in the period into Entanet International and Creative Graphics International. After the period-end a further £1.46 million was invested into Tharstern.
-	Liquidity was enhanced by a successful fundraising, which closed in May 2014, raising net funds of £8.19 million.

PERFORMANCE SUMMARY

The net asset value per share of the Company at 30 June 2014 was 111.55 pence.

	NAV per share	Cumulative dividends paid per share	Cumulative total shareholder return per share¹
			(NAV basis)
	(p)	(p)	(p)
As at 31 December 2006	100.64	1.80	102.44
As at 31 December 2007	116.89	4.20	121.09
As at 31 December 2008	86.54	15.30	101.84
As at 31 December 2009	83.34	16.30	99.64
As at 31 December 2010	96.66	21.30	117.96
As at 31 December 2011	95.59	26.80	122.39
As at 31 December 2012	94.22	38.05	132.27
As at 31 December 2013	102.18	44.05	146.23
As at 30 June 2014	111.55	47.30²	158.85

1	Cumulative NAV total shareholder return per share is net asset value per share plus cumulative dividends paid to date per share. It therefore excludes dividends declared but not yet paid.
2	An Interim dividend totalling 17.00 pence per share has been declared by the Directors and will be paid on 17 September 2014, bringing cumulative dividends paid to date to 64.30 pence per share. The NAV per share will reduce by a corresponding 17.00 pence.

The figures quoted in the information given above are for the shares subscribed in the original offer for subscription in 2004/05.

The table above shows the recent past performance of the original funds raised in 2004/05. Performance data for all fundraising rounds and for former Matrix Income & Growth 3 VCT plc ("MIG3 VCT") shareholders will be shown in an appendix at the back of the Half-Yearly Report.

CHAIRMAN'S STATEMENT

I am pleased to present the Half-Yearly Report for Mobeus Income & Growth VCT plc covering the six month period ended 30 June 2014.

Net asset value and NAV total return to shareholders

This has been a period of very strong performance for the Company.    The net asset value per share as at 30 June 2014 was 111.55 pence compared with the previously reported NAV per share of 102.18 pence as at 31 December 2013.   The Company's total return for the half-year (NAV basis) was 12.4% (2013: 9.0%) after  adding back the final dividend of 3.25 pence per share paid  in this period in respect of the year ended 31 December 2013.   Meanwhile, the cumulative NAV total return per share (being the closing net asset value plus total dividends paid to date since launch) rose during the six month period by 8.6%, from 146.23 pence to 158.85 pence.

This healthy rise in NAV return over the period was largely due to three substantial, profitable realisations of ATG Media (partial), MachineWorks and Monsal supported by unrealised gains across the portfolio, notably increases in the valuations of ASL Technology, DiGiCo Global, EMaC, Focus and Youngman.  The increase in the value of the portfolio reflects the higher levels of profitability of a number of investee companies, several of which have used surplus cash to make loan repayments to the Company.

To assist shareholders who originally invested in any of the individual fundraisings (including MIG 3 VCT) to monitor the performance of their investment (including dividend payments) on a consistent basis, a table showing the returns to shareholders from each allotment will be included at the back of the Half-Yearly Report - and is available on the company's website: www.migvct.co.uk.

Investment portfolio

Overall the investment portfolio recorded a gain of £6.69 million (17.0% of the opening value) during the first half of the year and was valued at £39.66 million at the period-end.    

A total of £3.03 million was invested during the period to finance two MBO transactions. In February, the Company invested £1.71 million to support the MBO of Entanet International Limited ("Entanet"), a wholesale communications provider, whilst in June, a new investment of £1.32 million was made to support the Buy-in/MBO of Creative Graphics International Limited ("CGI"), a leading specialist provider of self-adhesive branding solutions to the automotive, recreational vehicle and airline markets.

Shortly after the period-end, a further new investment of £1.46 million was made to support the MBO of Tharstern Limited, the UK's leading supplier of software-based management information systems to the print sector.

This has been an exceptionally strong period for portfolio realisations.  Net cash proceeds receivable from portfolio realisations during the first six months of the year amounted to £10.67 million, giving rise to realised gains of £3.38 million in the period.  These proceeds arose primarily from the partial sale of ATG Media (as part of which the VCT retained a loan stock and small equity investment in Turner Topco Limited, the acquirer of ATG Media, valued at 30 June 2014 at £2.56 million) and the full sales of MachineWorks and Monsal. They also included loan stock repayments of £2.04 million from five companies, but mainly from CB Imports (Country Baskets) and Fullfield (Motorclean).   In addition, DiGiCo was sold following the period-end, realising further cash proceeds of £3.37 million, which is also the gain over cost on this investment.

Details of all these transactions can be found in the Investment Adviser's Review below.

Revenue account

The net revenue return for the period also posted a healthy increase, rising by £0.25 million from £1.22 million this time last year, to £1.47 million for the period under review.   This was mainly because income rose by £0.29 million primarily due to an increase in dividend income of £0.36 million to £0.52 million.  Despite more cash currently being held in bank deposits, income from cash balances fell slightly by an amount of £0.03 million, as interest rates continued to fall on such deposits.

Investment Adviser's fees charged to revenue rose by £0.03 million due to rising net assets.  Other expenses rose by £0.04 million, due to a rise in Directors' fees, professional fees and trail commission costs, countered by a reduction in registrar's costs.

Interim dividend

The Directors are pleased to declare an interim dividend of 17.00 pence (2013: 4.00 pence) per share comprising an income dividend of 2.00 pence (2013: 2.00 pence) per share and a capital dividend of 15.00 pence (2013: 2.00 pence) per share.  This interim dividend will be paid on 17 September 2014 to shareholders on the Register on 22 August 2014 and will bring cumulative dividends paid per share to 64.30 pence.

The magnitude of this capital dividend reflects the exceptional level of capital gains realised in the year so far.  In the period under review, this included the partial realisation of ATG Media and the full disposal of each of MachineWorks and Monsal as well as a number of smaller loan stock repayments.  Shareholders should not expect this level of capital distribution to be repeated unless an equally successful run of realisations occurs. 

The total of all capital gains in the year to date (being net cash proceeds less original investment cost) were £10.12 million which compares with £1.71 million for the whole of 2013.  The former includes the three disposals referred to above, and in the Investment Adviser's Review, in addition to net cash proceeds received from the realisation of DiGiCo Global after the period-end.

Fundraising

The Company participated with the other three Mobeus VCTs in a successful linked fundraising that closed on 30 May 2014.  A total of £33.73 million (in excess of the original target of £24 million) was subscribed for under the Offer across the four VCTs, of which £8.43 million (£8.19 million after costs) was raised by the Company. The Board would like to thank the 722 existing shareholders and extend a very warm welcome to the 946 new shareholders, who invested in the Company through this fundraising. The Company had 5,098 shareholders as at 30 June 2014. 

Annual fundraisings by the Company have provided it with a comfortable level of liquidity that has enhanced its ability to use the money raised in earlier fundraisings to continue to pursue its MBO strategy.  Monies raised will be used to fund other types of investment opportunities, as well as to meet the Company's running costs, fund dividend payments and support its share buyback policy.  Buybacks by the Company of its own shares help to provide liquidity in the Company's shares in what would otherwise be an illiquid market.   The new funds also mean that the Company's fixed running costs are spread over a larger asset base.  The Board is minded to participate in future fundraisings for the Mobeus VCTs.  If the Company does fundraise, shareholders will have the opportunity to increase their investment in the Company and will be sent details of the offer later in the year.

General meeting and renewal of shareholder authorities

A notice of the General Meeting of the Company to be held at 10.30 am on Wednesday, 8 October 2014 at the offices of Mobeus Equity Partners LLP, 30 Haymarket, London SW1Y 4EX, together with a proxy form for the meeting will be sent with shareholders' copies of the Half-Yearly Report.  Shareholders who have elected to receive communications from the Company via email, will be notified of how to submit their proxy votes electronically.

The purpose of the meeting is to renew authorities for the Directors to allot shares in the Company (Resolution 1) and disapply the pre-emption rights of members (Resolution 2), with the purpose of ensuring that the Company will be in a position to participate in any future fundraising for the Mobeus VCTs, as referred to above, should the Board be minded to do so. Both resolutions are in substitution for existing authorities and will replace the equivalent authorities taken at the Annual General Meeting of the Company on 7 May 2014.

Resolution 1 is being proposed as an ordinary resolution requiring more than 50% of the votes cast at the meeting to be in favour and Resolution 2 will be proposed as a special resolution requiring at least 75% of the votes cast at the meeting to be in favour.

The following is an explanation of the resolutions to be proposed at the General Meeting:

Authorities for the directors to allot shares in the Company (Resolution 1) and disapply the pre-emption rights of members (Resolution 2)

These two resolutions will grant the Directors the authority to allot shares for cash to a limited and defined extent otherwise than pro rata to existing shareholders. Resolution 1 will enable the Directors to allot new shares up to an aggregate nominal amount of £330,425 representing approximately 54.3% of the existing issued share capital of the Company as at the date of the notice convening the General Meeting.

Under section 561(1) of the Companies Act 2006, if the Directors wish to allot new shares or sell or transfer treasury shares for cash they must first offer such shares to existing shareholders in proportion to their current holdings. It is proposed by Resolution 2 to sanction the disapplication of such pre-emption rights in respect of the allotment of equity securities:

(i) with an aggregate nominal value of up to £300,000 in connection with offer(s) for subscription; and

(ii) with a nominal value of up to 5% of the issued share capital of the Company from time to time,

in each case where the proceeds may be used in whole or part to purchase the Company's shares in the market.

The Company does not currently hold any shares as treasury shares. Both resolutions will expire on the date falling fifteen months after the passing of the resolution or, if earlier, on the conclusion of the annual general meeting of the Company to be held in 2015. The Directors may allot securities after the expiry dates specified above in pursuance of offers or agreements made prior to the expiration of these authorities.

Liquidity

The Directors continue to seek opportunities to increase returns on the liquid assets of the Company without compromising the overriding requirement that risk to capital is minimised.   The VCT continues to hold £1.63 million in a selection of money market funds with AAA credit ratings at 30 June 2014.  The balance of cash and current asset investments of £23.91 million is held in deposit accounts with a number of well-known financial institutions across a range of maturities. 

Appointment of a new board director

The Board appointed Catherine Wall as a Director of the Company with effect from 1 July 2014.  Catherine has 30 years' experience in the private equity industry, principally gained at Barclays Private Equity (now Equistone Partners Europe) where she led and managed numerous investments in management buy-outs.  Later, as the firm's UK portfolio director, she supervised the management of all the firm's UK investments and held numerous non-executive directorships as part of this role.  Shareholders will have the opportunity to ratify her appointment at the next Annual General Meeting of the Company, to be held in May 2015. 

Investment in qualifying holdings

The Company is required to meet the target set by HM Revenue & Customs ("HMRC") of investing at least 70% of the funds raised in qualifying unquoted and AIM quoted companies.  The Company exceeded this limit (based on VCT cost as defined in tax legislation which differs from the actual cost given in the Investment Portfolio Summary below) throughout the period.  The balance of the portfolio was invested in non-qualifying investments and cash.

Share buybacks

During the six months ended 30 June 2014, the Company bought back a further 0.44 million of its own shares, representing 0.8% of the issued share capital at the beginning of the period, at an average price, including costs, of 90.34 pence per share.  All of the shares bought back in the period were subsequently cancelled by the Company.  Continuing shareholders benefit from the difference between the NAV per share and the price per share at which the shares are bought back and cancelled.

Industry developments

The Finance Act 2014 introduced two measures that affect VCTs.  Firstly, shareholders who sell their existing shares within six months before or after the date of subscribing for shares in the same VCT will not receive income tax relief on their new investment, a measure designed to prevent "enhanced buybacks" of VCT shares.

Secondly, the Act introduced measures intended to prevent the return of capital to shareholders prior to any profits being earned from the capital invested.   This restriction only applies to funds raised after 5 April 2014 and it will not affect the ability of the Company to continue to pay dividends from profits and income that have been realised from investments in the portfolio.

Finally, with effect from 22 July 2014, the Board has appointed the Company as its own Alternative Investment Fund Manager ("AIFM") in compliance with the European Commission's Alternative Investment Fund Manager's Directive.  The Directive will tighten the rules on alternative investments.   However, the Company is registered as a small AIFM and will therefore be exempt from its principal requirements.  Mobeus will continue to provide investment advisory and administrative services to the Company under the current agreement, subject to one change.  This is that the company secretarial staff are now directly responsible to the Board, under its instruction, for accessing and dealing with the documents of title to the Company's investments.  These new arrangements will enable the Company to discharge its safekeeping responsibilities for these documents.

Shareholder workshop - 27 January 2015

The Investment Adviser holds an annual VCT workshop in Central London for all its VCT shareholders.   Each workshop includes a presentation on the Mobeus VCTs' investment activity and performance.  The Board and the Investment Adviser welcome attendance and feedback from shareholders. The next workshop will be held on Tuesday, 27 January 2015 at the Royal Institute of British Architects in Central London.  There will be separate day-time and evening sessions.  Shareholders will be sent an invitation to this event with further details nearer to the date.

Outlook

It is particularly pleasing to have seen a number of investments being realised at substantial gains over cost during the period under review. The challenge for the Company will be to maintain this performance over the longer term and also to sustain current investment levels. At present, favourable market conditions are assisting your Company in meeting this challenge. The Investment Adviser believes that there continues to be a healthy level of quality deal flow in the market and that many of our investee companies should continue to trade profitably and grow. This should provide further opportunities for attractive new investments and for profitable realisations that will contribute towards producing further income and capital returns for shareholders.

Finally, I would like to thank all of our shareholders for their continuing support.

Keith Niven

Chairman

INVESTMENT POLICY

Investments are usually structured as part loan and part equity in order to receive regular income and to generate capital gains from realisations.

Investments are made selectively across a number of sectors, primarily in MBOs i.e. to support incumbent management teams in acquiring the businesses they manage but do not own. Investments are primarily made in companies that are established and profitable.

Uninvested funds are held in cash and lower risk money market funds.

VCT regulation

The Investment Policy is designed to ensure that the VCT continues to qualify and is approved as a VCT by HMRC. Amongst other conditions, the VCT may not invest more than 15% of its investments in a single company or group of companies. It must also have at least 70% by value of its investments throughout the period in shares or securities comprising VCT qualifying holdings, of which a minimum overall of 30% by value (70% for funds raised on or after 6 April 2011) must be in ordinary shares which carry no preferential rights (save as may be permitted under VCT rules). The VCT can invest less than 30% by value (70% for funds raised on or after 6 April 2011) of an investment in a specific company in ordinary shares. It must, however, have at least 10% by value of its total investments in each VCT qualifying company in ordinary shares which carry no preferential rights (save as may be permitted under VCT rules).

UK companies

The companies in which investments are made must have no more than £15 million of gross assets at the time of investment and £16 million immediately following the investment to be classed as a VCT qualifying holding.

Asset mix

The VCT holds its liquid funds in a portfolio of readily realisable interest-bearing investments and deposits. The investment portfolio of qualifying investments has been built up over time with the aim of investing and maintaining around 80% of net funds raised in qualifying investments.

Risk diversification

Risk is spread by investing in a number of different businesses across different industry sectors. To reduce the risk of investing in unquoted businesses, each qualifying investment is structured to maximise the amount which may be invested in loan stock as opposed to equity.

Co-investment

The VCT aims to invest in larger, more mature, unquoted companies through investing alongside three other VCTs advised by Mobeus with similar investment policies. This enables the VCT to participate in combined investments by the Investment Adviser of up to £5 million in each business year.

Borrowing

The Company's Articles of Association ("Articles") permit borrowings of amounts up to 10% of the adjusted capital and reserves (as defined therein). The VCT has never borrowed and the Board has no current plans to undertake any borrowing.

INVESTMENT ADVISER'S REVIEW

New investment

A total of £3.03 million was invested during the six months under review. This included substantial new investments to support the MBOs of Entanet International ("Entanet") and Creative Graphics International ("CGI").

Principal new investments in the half-year

Company	Business	Month	Amount of new investment (£m)
Entanet	Wholesale provider of internet connectivity solutions	February	£1.71
Entanet is one of the UK's leading independent wholesale voice and data communications providers. Headquartered in Telford and with over 80 staff, the company provides a diverse portfolio of business class data and voice services via a network of over 2,000 wholesale and reseller channel partners in the UK.  The total amount invested included £1 million from Ackling Management Limited, one of the Company's acquisition vehicles. The Company's audited accounts for the 13 months ended 31 December 2013 show annual sales of £29.42 million and profit before interest, tax and goodwill of £2.78 million.
CGI	Producer of adhesive decorative graphics for vehicles	June	£1.32
CGI is a leading specialist provider of adhesive decorative graphics to the automotive, recreational vehicle and airline markets.  It operates from two centres, in Bedford and South Africa.  The Company's audited accounts for the year ended 30 November 2012 show annual sales of £12.64 million and profit before interest, tax and goodwill of £2.49 million.
The VCT has also invested a further £2.29 million into two new acquisition vehicle investments, South West Services Investment Limited and Manufacturing Services Investment Limited, companies established to acquire business services companies in the South West of England and in the manufacturing sector respectively.

Investment post period-end

Company	Business	Month	Amount of new investment (£m)
Tharstern	Software-based management information systems	July	£1.46
Tharstern is the UK's leading supplier of software-based management information systems to the print sector.  The Company's audited accounts for the year ended 31 January 2014 show annual sales of £3.87 million and profit before interest, tax and goodwill of £0.80 million.

Realisations in the half-year

We have been particularly pleased with the quality of realisations over the first half of the year which  have all generated attractive returns for the Company.  The VCT completed the partial realisation of ATG Media and the full realisations of each of MachineWorks and Monsal for totalnet cash proceeds of £10.67 million.  As part of the ATG Media transaction, the Company received an additional £2.50 million by way of issue of new loan stock and equity investments in Turner Topco Limited, the acquirer of ATG Media.  Total net proceeds therefore amounted to £13.17 million.

Company	Business	Period of investment	Total cash proceeds over the life of the investment / Multiple over cost
MachineWorks	Software for CAM and machine tool vendors	April 2006-	£2.66 million
		April 2014	4.1 times cost
MachineWorks' core software products are used by builders of machine tool controllers to simulate real life manufacturing situations.  The company was spun out of the Company's original investment in VSI in March 2011 and was sold to the German company, Dr Johannes Heidenhain GmbH to produce a very attractive return on original investment cost.
ATG Media	Publisher and online auction platform operator	October 2008-	£6.00 million
		present	1.8 times cost to date
ATG Media has grown revenues and profited materially since initial investment in 2008.   A partial sale of the company under a secondary MBO to a larger private equity house, ECI Partners, has realised net proceeds of £7.57 million, being cash of £5.07 million, with the balance being a new loan stock investment and a minority 6.2% equity stake, together valued at £2.56 million (cost £2.50 million).  The cash returns received to date have crystallised an annual return of 20%, making this a particularly successful investment.
Monsal	Supplier of engineering services to the water and waste sectors	December 2007-	£2.64 million
		June 2014	1.9 times cost
The sale of Monsal, a renewable energy consultancy, to the US conglomerate General Electric Company, realised net cash proceeds of £1.84 million. The return on original cost represents a good return on an investment originally made in 2007 but which required support from further funding rounds in 2009 and 2011.

Loan stock repayments

Loan stock repayments totalled £5.57 million for the period, including £3.53 million as part of the proceeds from the companies realised above.  Positive cashflow at five other companies contributed to the balance of £2.04 million, as summarised below:-

Company	Business	Month	Amount (£000's)
Country Baskets	Artificial flowers, floral sundries and home décor products	June	1,250
Motorclean	Vehicle cleaning and valeting services	June	307
Newquay Helicopters	Helicopter services	April	293
Westway	Air conditioning services	January	108
Tessella	Consultancy services	Quarterly	84
		Total	2,042

Also during the period, £0.09 million was received from Iglu.com Holidays Limited as tax retention monies were released.

Realisation post period-end

Company	Business	Period of investment	Total cash proceeds over the life of the investment /                  Multiple over cost
DiGiCo Global	Audio mixing desks	July 2007 -	£10.67 million
		July 2014	5.5 times cost
The VCT realised this investment through a sale to a new professional audio group back by Electra Partners and generated both net cash proceeds and a capital gain over cost of £3.37 million in July. The business has demonstrated strong and consistent growth since investment. Turnover has grown threefold from £8 - £24 million over the period of the VCT's investment. This final sale follows a partial realisation in December 2011 through a secondary buyout by ISIS Equity Partners.

Investment outlook

We are pursuing a number of opportunities which we hope will materialise over the coming months into new investments and further realisations for the Company.  Dealflow remains healthy, reflecting our perception that the level of M&A activity in the small company sector continues to be buoyant.  Our intention is to maximise the opportunities presented by these current favourable market conditions, to execute new investment deals and realisations, to meet our aims of sustaining current investment levels and to secure continued attractive returns to shareholders.

Mobeus Equity Partners LLP

INVESTMENT PORTFOLIO SUMMARY

As at 30 June 2014

	Market sector	Date of investment	Total book cost	Valuation	Like for like valuation increase/ (decrease) over the period¹	% value of net assets
Qualifying investments			£'000	£'000
Unquoted investments
Ingleby (1879) Limited (trading as EMaC)	Support services	Nov-11	1,395	3,049	28.5%	4.5%
Provider of service plans for the motor trade
Blaze Signs Holdings Limited	Support services	Apr-06	492	2,808	7.5%	4.1%
Manufacturer and installer of signs
Turner Topco Limited (trading as ATG Media)	Media	Oct-08	2,501	2,557	New investment from sale of ATG Media	3.8%
Publisher and on-line auction platform operator
Virgin Wines Holding Company Limited (formerly Culbone Trading Limited)	General retailers	Nov-13	2,526	2,526	-	3.7%
Online wine retailer
Fullfield Limited (trading as Motorclean)	Support services	Jul-11	2,270	2,484	(5.8)%	3.7%
Provider of vehicle cleaning and valet services
Tessella Holdings Limited	Support services	Jul-12	1,474	2,159	7.5%	3.2%
Technology consultancy
ASL Technology Holdings Limited	Support services	Dec-10	1,913	2,010	48.1%	3.0%
Printer and photocopier services
Focus Pharma Holdings Limited	Pharmaceuticals	Oct-07	387	1,962	44.3%	2.9%
Licensor and distributer of generic pharmaceuticals
Veritek Global Holdings Limited (formerly Madacombe Trading Limited)	Support services	Jul-13	2,045	1,865	(8.8)%	2.7%
Maintenance of imaging equipment
Gro-Group Holdings Limited	General retailers	Mar-13	1,928	1,741	(9.7)%	2.6%
Baby sleep products
Ackling Management Limited (trading as Entanet International)³	Fixed Line Telecommunications	Feb-14	1,714	1,714	New investment	2.5%
Wholesale voice and data communications provider
Creative Graphics International Limited	General Industrials	Jun-14	1,322	1,322	New investment	1.9%
Provider of adhesive decorative graphics for the automotive, recreational vehicle and airline markets
South West Services Investment Limited	Support services	Jan-14	1,143	1,143	New investment	1.7%
Company seeking to acquire a business service company in the South West of England
Manufacturing Services Investment Limited	Support services	Feb-14	1,142	1,142	New investment	1.7%
Company seeking to acquire a business in the manufacturing sector
Youngman Group Limited	Support services	Oct-05	1,000	1,129	61.1%	1.7%
Manufacturer of ladders and access towers
EOTH Limited (trading as Rab and Lowe Alpine)	General retailers	Oct-11	1,000	1,097	8.9%	1.6%
Branded outdoor equipment and clothing
Westway Services Holdings (2010) Limited	Support services	Jun-09	304	1,018	2.8%	1.5%
Installation, service and maintenance for air conditioning systems
RDL Corporation Limited	Support services	Oct-10	1,558	992	38.0%	1.5%
Recruitment consultant for the pharmaceutical, business intelligence and IT industries
CB Imports Group Limited (trading as Country Baskets)	General retailers	Dec-09	969	788	16.7%	1.2%
Importer and distributor of artificial flowers and floral sundries.
The Plastic Surgeon Holdings Limited	Support services	Apr-08	478	761	18.0%	1.1%
Supplier of snagging and finishing services to the domestic and commercial property markets
Vectair Holdings Limited	Support services	Jan-06	139	635	(1.1)%	0.9%
Designer and distributor of washroom products
Newquay Helicopters (2013) Limited	Support services	Jun-06	226	396	-	0.6%
Helicopter service operator
PXP Holdings Limited (trading as Pinewood Structures)	Construction & Materials	Dec-06	1,278	114	-	0.2%
Designer, manufacturer and supplier of timber-frames for buildings
Lightworks Software Limited	Software and computer services	Apr-06	223	71	(64.8)%	0.1%
Provider of software for CAD vendors
Racoon International Holdings Limited	Personal goods	Dec-06	1,213	1	-	0.0%
Supplier of hair extensions, hair care products and training
Legion Group plc (in administration)	Support services	Aug-05	150	-	-	0.0%
Provider of manned guarding, mobile patrolling and alarm response services
Watchgate Limited	Support services	Nov-11	1	-	-	0.0%
Holding company
Total unquoted investments			30,791	35,484	17.2%	52.4%
AiM quoted investments
Omega Diagnostics Group plc	Health care equipment and services	Dec-10	305	483	8.5%	0.7%
In-vitro diagnostics for food intolerance, autoimmune diseases and infectious diseases
Total AIM quoted investments			305	483		0.7%
Total qualifying investments			31,096	35,967	17.1%	53.1%
Non-qualifying investments
DiGiCo Global Limited 2	Technology, hardware and equipment	Dec-11	1,612	3,371	18.0%	5.0%
Designer and manufacturer of digital sound mixing consoles
EOTH Limited (trading as Rab and Lowe Alpine)	General retailers	Oct-11	298	324	-	0.5%
Total non-qualifying investments			1,910	3,695	-	5.5%
Total portfolio investments			33,006	39,662	17.0%	58.6%
Current investments and cash at bank
Cash at NatWest Bank plc4			12,886	12,886		18.9%
HSBC Bank plc5			3,506	3,506		5.2%
Lloyds Bank plc5			3,504	3,504		5.2%
Barclays Bank plc5			2,010	2,010		3.0%
Nationwide International5			2,000	2,000		2.9%
GS Funds plc (GoldmanSachs)5			429	429		0.6%
GS Funds plc (Goldman Sachs) (formerly Royal Bank of Scotland plc)5			387	387		0.6%
Insight Liquidity Funds plc (HBOS)5			271	271		0.4%
Institutional Cash Series plc (BlackRock)5			256	256		0.4%
SWIP Global Liquidity Fund plc (Scottish  Widows)5			176	176		0.3%
Fidelity Institutional Cash Fund plc5			114	114		0.2%
Total current investments  and cash at bank			25,539	25,539		37.7%
Total investments			58,545	65,201		96.3%
Other assets				3,273		4.7%
Current liabilities				(595)		(1.0)%
Net assets				67,879		100.0%
1 - This percentage change in 'like for like' valuations is the result of dividing the total of the closing valuation of the investment, plus any proceeds in the period from partial disposals, by the valuation at the start of the period.
2 - Original investment was in DiGiCo Europe Limited in July 2007. This was partially realised in December 2011, since when part of the loan stock issued then has also been realised. Therefore, the figures above represent the cost and valuation of the remainder of the investment, realised in July 2014.
3 - £1,000,000 of this investment into Ackling Management Limited (trading as Entanet International) had been invested in this company, which was formerly an acquisition vehicle, in a previous period.
4 - Disclosed as Cash at bank within Current assets in the Balance Sheet.
5 - Disclosed as Current Investments within Current assets in the Balance Sheet.

RESPONSIBILITY STATEMENT OF THE DIRECTORS IN RESPECT OF THE HALF-YEARLY REPORT

In accordance with Disclosure and Transparency Rule (DTR) 4.2.10, Keith Niven (Chairman), Bridget Guérin (Chairman of the Nominations & Remuneration Committee), Tom Sooke (Chairman of the Audit Committee) and Catherine Wall, 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 the statement, "Half-Yearly Reports", issued by the Accounting Standards Board, gives a true and fair view of the assets, liabilities, financial position and profit of the Company, as required by DTR 4.2.4;
(b)	the Half-Yearly Management Report, which comprises the Chairman's Statement, Investment Policy, Investment Adviser's 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 are no related party transactions 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 Accounts for the year ended 31 December 2013. 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 risk;
-	risk of loss of approval as a Venture Capital Trust;
-	investment and strategic risk;
-	regulatory risk;
-	financial and operating risk;
-	market risk;
-	asset liquidity risk;
-	market liquidity risk;
-	credit/ counterparty risk.

A more detailed explanation of these risks can be found in the Strategic Report on pages 21 - 22 and in Note 19 on pages 55 - 61 of the Annual Report and Accounts for the year ended 31 December 2013, copies of which are available on the Investment Adviser's website, www.mobeusequity.co.uk  or by going direct to : 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-Yearly Management Report. The Directors have satisfied themselves that the Company continues to maintain a significant cash position, the majority of companies in the portfolio continue to trade profitably and the portfolio taken as a whole remains resilient and well-diversified.  The major cash outflows of the Company (namely investments, 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 Note19 on pages 55 - 61 of the Annual Report and Accounts for the year ended 31 December 2013.   Accordingly, the Directors continue to adopt the going concern basis of accounting in preparing the half-yearly 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.

On behalf of the Board

Keith Niven

Chairman

UNAUDITED INCOME STATEMENT

for the six months ended 30 June 2014

	Six months ended 30 June 2014				Six months ended 30 June 2013
			(unaudited)			(unaudited)
	Notes	Revenue	Capital	Total	Revenue	Capital	Total
		£	£	£	£	£	£
Unrealised gains on investments	8	-	3,310,223	3,310,223	-	2,890,482	2,890,482
Net realised gains  on investments	8	-	3,380,466	3,380,466	-	605,461	605,461
Income	2	2,111,620	-	2,111,620	1,816,882	-	1,816,882
Investment adviser's fees	3	(166,887)	(500,663)	(667,550)	(136,480)	(409,440)	(545,920)
Other expenses		(208,051)	-	(208,051)	(170,922)	-	(170,922)
Profit on ordinary activities before taxation		1,736,682	6,190,026	7,926,708	1,509,480	3,086,503	4,595,983
Tax on profit on ordinary activities	4	(262,957)	107,643	(155,314)	(293,043)	131,406	(161,637)
Profit attributable to equity shareholders		1,473,725	6,297,669	7,771,394	1,216,437	3,217,909	4,434,346
Basic and diluted earnings per ordinary share	5	2.55p	10.90p	13.45p	2.40p	6.35p	8.75p
		Year ended 31 December 2013
				(audited)
	Notes	Revenue	Capital	Total
		£	£	£
Unrealised gains on investments	8	-	4,832,261	4,832,261
Net realised gains  on investments	8	-	725,905	725,905
Income	2	3,459,318	-	3,459,318
Investment adviser's fees	3	(286,839)	(860,517)	(1,147,356)
Other expenses		(290,635)	-	(290,635)
Profit on ordinary activities before taxation		2,881,844	4,697,649	7,579,493
Tax on profit on ordinary activities	4	(504,213)	200,070	(304,143)
Profit attributable to equity shareholders		2,377,631	4,897,719	7,275,350
Basic and diluted earnings per ordinary share	5	4.56p	9.41p	13.97p

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

All revenue and capital items in the above statement derive from continuing operations.

There were no other recognised gains or losses in the period.

Other than revaluation movements arising on investments held at fair value through profit and loss, there were no differences between the profit as stated above and at historical cost.

UNAUDITED BALANCE SHEET

as at 30 June 2014

		30 June 2014	30 June 2013	31 December 2013
		(unaudited)	(unaudited)	(audited)
	Notes	£	£	£
Fixed assets
Investments at fair value	1c, 8	39,662,044	37,334,097	39,317,184
Current assets
Debtors and prepayments	9	3,272,913	500,094	609,464
Current investments	10	12,653,372	9,632,916	9,642,587
Cash at bank		12,885,788	6,927,943	5,157,499
		28,812,073	17,060,953	15,409,550
Creditors: amounts falling due within one year		(595,449)	(389,830)	(458,366)
Net current assets		28,216,624	16,671,123	14,951,184
Net assets		67,878,668	54,005,220	54,268,368
Capital and reserves	11
Called up share capital		608,500	536,273	531,126
Capital redemption reserve		4,367	181,372	186,520
Share premium account		4,938,202	15,361,612	15,361,612
Revaluation reserve		9,800,394	7,903,451	9,867,216
Special distributable reserve		43,181,014	27,383,210	25,580,251
Profit and loss account		9,346,191	2,639,302	2,741,643
Equity shareholder funds		67,878,668	54,005,220	54,268,368
Net asset value per ordinary share	7	111.55p	100.70p	102.18p

UNAUDITED RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS

for the six months ended 30 June 2014

		Six months ended	Six months ended	Year ended
		30 June 2014	30 June 2013	31 December 2013
		(unaudited)	(unaudited)	(audited)
	Notes	£	£	£
Opening shareholders' funds		54,268,368	43,288,523	43,288,523
Net share capital bought back in                 the period - including expenses		(394,540)	(10,032,939)	(10,474,734)
Net share capital subscribed for in the period - net of expenses		8,193,915	17,393,269	17,393,270
Profit for the period		7,771,394	4,434,346	7,275,350
Dividends paid in period	6	(1,960,469)	(1,077,979)	(3,214,041)
Closing shareholders' funds		67,878,668	54,005,220	54,268,368

UNAUDITED CASH FLOW STATEMENT

for the six months ended 30 June 2014

		Six months ended	Six months ended	Year ended
		30 June 2014	30 June 2013	31 December 2013
		(unaudited)	(unaudited)	(audited)
	Notes	£	£	£
Operating activities
Investment income received		2,157,392	1,700,362	3,066,706
Other income		-	-	3,615
Investment adviser's fees paid		(667,550)	(545,920)	(1,147,356)
Other cash payments		(170,283)	(131,504)	(286,453)
Net cash inflow from operating activities		1,319,559	1,022,938	1,636,512
Investing activities
Acquisitions of investments	8	(4,321,087)	(2,123,350)	(4,765,043)
Disposals of investments	8	8,741,449	3,142,871	5,863,541
Net cash inflow/(outflow) from investing activities		4,420,362	1,019,521	1,098,498
Dividends
Equity dividends paid	6	(1,960,469)	(1,077,979)	(3,214,041)
Cash inflow/(outflow) before financing and liquid resource management		3,779,452	964,480	(479,031)
Management of liquid resources
Increase in current investments		(3,010,785)	(6,000,248)	(6,009,919)
Financing
Shares issued as part of fundraising offer for subscription	11	7,405,079	7,922,677	8,092,536
Shares issued as part of the enhanced buyback facility		-	9,300,734	250,000
Shares bought back as part of the enhanced buyback facility (including expenses)		-	(9,412,459)	(388,289)
Share capital bought back		(445,457)	(560,249)	(1,020,806)
Net inflow from financing activities		6,959,622	7,250,703	6,933,441
Increase in cash for the period		7,728,289	2,214,935	444,491

RECONCILIATION OF PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION TO NET CASH INFLOW FROM OPERATING ACTIVITIES

for the six months ended 30 June 2014

	Six months ended	Six months ended	Year ended
	30 June 2014	30 June 2013	31 December 2013
	(unaudited)	(unaudited)	(audited)
	£	£	£
Profit on ordinary activities before taxation	7,926,708	4,595,983	7,579,493
Net unrealised gains on investments	(3,310,223)	(2,890,482)	(4,832,261)
Net gains on realisations of investments	(3,380,466)	(605,461)	(725,905)
Decrease/(increase) in debtors	50,694	(114,710)	(393,780)
Increase in creditors	32,846	37,608	8,965
Net cash inflow from operating activities	1,319,559	1,022,938	1,636,512

The notes below form part of these Half-Yearly financial statements.

NOTES TO THE UNAUDITED FINANCIAL STATEMENTS

1.	Principal accounting policies
	The following accounting policies have been applied consistently throughout the period. Full details of principal accounting policies will be disclosed in the Annual Report.
	a)  Basis of accounting
	The unaudited results cover the six months to 30 June 2014 and have been prepared under UK Generally Accepted Accounting Practice (UK GAAP), consistent with the accounting policies set out in the statutory accounts for the year ended 31 December 2013 and the 2009 Statement of Recommended Practice, 'Financial Statements of Investment Trust Companies and Venture Capital Trusts' ('the SORP') issued by the Association of Investment Companies. The financial statements are prepared under the historical cost convention except for the measurement of certain investments at fair value.
	The Half-Yearly Report has not been audited, nor has it been reviewed by the auditor pursuant to the Auditing Practices Board (APB)'s guidance on Review of Interim Financial Information.
	b) Presentation of the Income Statement
	In order to better reflect the activities of a VCT and in accordance with the SORP, 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.
	c)  Investments
	Investments are accounted for on a trade date basis.
	All investments held by the Company are classified as "fair value through profit and loss", in accordance with the International Private Equity and Venture Capital Valuation ("IPEVCV") guidelines, as updated in September 2009. 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.
	For investments actively traded in 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. Purchases and sales of unlisted investments are recognised when the contract for acquisition or sale becomes unconditional.
	Unquoted investments are stated at fair value by the Directors in accordance with the following rules, which are consistent with the IPEVCV guidelines:
	All investments are held at the price of a recent investment for an appropriate period where there is considered to have been no change in fair value. Where such a basis is no longer considered appropriate, the following factors will be considered:
	(i) Where a value is indicated by a material arms-length transaction by an independent third party in the shares of a company, this value will be used.
	(ii) In the absence of  i), and depending upon both the subsequent trading performance and investment structure of an investee company, the valuation basis will usually move to either:-
	a) an earnings multiple basis. The shares may be valued by applying a suitable price-earnings ratio to that company's historic, current or forecast post-tax earnings before interest and amortisation (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:-
	b) where a company's underperformance against plan indicates a diminution in the value of the investment, provision against cost  is made, as appropriate. Where the value of an investment has fallen permanently below cost, 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.
	(iii) Premiums on loan stock investments are accrued at fair value when the Company receives the right to the premium and when considered recoverable.
	(iv) Where an earnings multiple or cost less impairment basis is not appropriate and overriding factors apply, discounted cash flow or net asset valuation 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.
2.	Income
		Six months ended	Six months ended		Year ended
		30 June 2014	30 June 2013		31 December 2013
		(unaudited)	(unaudited)		(audited)
		£	£		£
	Dividends	515,427	156,094		577,422
	Money-market funds	2,948	2,999		6,146
	Loan stock interest	1,506,324	1,575,288		2,723,737
	Bank deposit interest	51,901	82,501		152,013
	Interest on preference dividends	30,287	-		-
	Other income	4,733	-		-
	Total Income	2,111,620	1,816,882		3,459,318
3.	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 management expense to the capital reserve.
4.	Taxation
	There is a tax charge for the period as the Company has taxable income in excess of deductible expenses. Last year, it utilised all available tax losses brought forward that had previously reduced taxable profit.
	Six months ended 30 June 2014 (unaudited)
			Revenue	Capital		Total
			£	£		£
	a)  Analysis of tax charge:
	UK Corporation tax on profits/(losses) for the period		262,957	(107,643)		155,314
	Total current tax charge/(credit)		262,957	(107,643)		155,314
	Corporation tax is based on a rate of 21.5% (2013: 20%)
	b) Profit on ordinary activities before tax		1,736,682	6,190,026		7,926,708
	Profit on ordinary activities multiplied by the small company rate of corporation tax in the UK of 21.5% (2013: 20%)		373,387	1,330,855		1,704,242
	Effect of:
	UK dividends		(110,817)	-		(110,817)
	Unrealised gains not allowable		-	(711,698)		(711,698)
	Realised gains not taxable		-	(726,800)		(726,800)
	Losses brought forward		-	-		-
	Marginal rate		-	-		-
	Expenses not deductible		387	-		387
	Actual current tax charge		262,957	(107,643)		155,314
						-
	Six months ended 30 June 2013 (unaudited)
			Revenue	Capital		Total
			£	£		£
	a)  Analysis of tax charge:
	UK Corporation tax on profits/(losses) for the period		293,043	(131,406)		161,637
	Total current tax charge/(credit)		293,043	(131,406)		161,637
	Corporation tax is based on a rate of 21.5% (2013: 20%)
	b) Profit on ordinary activities before tax		1,509,480	3,086,503		4,595,983
	Profit on ordinary activities multiplied by rate of corporation tax in the UK of 21.5% (2013: 20%)		301,896	617,300		919,196
	Effect of:
	UK dividends		(31,219)	-		(31,219)
	Unrealised gains not allowable		-	(578,096)		(578,096)
	Realised gains not taxable		-	(121,092)		(121,092)
	Losses brought forward		(27,152)	-		(27,152)
	Marginal rate		49,518	(49,518)		-
	Expenses not deductible		-	-		-
	Actual current tax charge		293,043	(131,406)		161,637
	Year ended 31 December 2013 (audited)
			Revenue	Capital		Total
			£	£		£
	a)  Analysis of tax charge:
	UK Corporation tax on profits/(losses) for the period		504,213	(200,070)		304,143
	Total current tax charge/(credit)		504,213	(200,070)		304,143
	Corporation tax is based on a rate of 21.5% (2013: 20%)
	b) Profit on ordinary activities before tax		2,881,844	4,697,649		7,579,493
	Profit on ordinary activities multiplied by rate of corporation tax in the UK of 21.5% (2013: 20%)		670,029	1,092,204		1,762,233
	Effect of:
	UK dividends		(134,251)	-		(134,251)
	Unrealised gains not allowable		-	(1,123,501)		(1,123,501)
	Realised gains not taxable		-	(168,773)		(168,773)
	Losses brought forward		(31,565)	-		(31,565)
	Marginal rate		-	-		-
	Expenses not deductible		-	-		-
	Actual current tax charge		504,213	(200,070)		304,143
5.	Basic and diluted earnings and return 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.
		Six months ended	Six months ended		Year ended
		30 June 2014	30 June 2013		31 December 2013
		(unaudited)	(unaudited)		(audited)
		£	£		£
	i) Total earnings after taxation	7,771,394	4,434,346		7,275,350
	Basic and diluted earnings per ordinary share	13.45p	8.75p		13.97p
	ii) Net revenue from ordinary activities after taxation	1,473,725	1,216,437		2,377,631
	Basic and diluted earnings per ordinary share	2.55p	2.40p		4.56p
	Unrealised gains	3,310,223	2,890,482		4,832,261
	Net realised capital gains	3,380,466	605,461		725,905
	Capital expenses (net of taxation)	(393,020)	(278,034)		(660,447)
	iii) Total capital return	6,297,669	3,217,909		4,897,719
	Basic and diluted capital earnings per ordinary share	10.90p	6.35p		9.41p
	iv) Weighted average number of ordinary shares in issue in the period	57,794,080	50,681,548		52,090,673
6.	Dividends paid
		Six months ended	Six months ended		Year ended
		30 June 2014	30 June 2013		31 December 2013
		(unaudited)	(unaudited)		(audited)
		£	£		£
	Final income dividend paid for year ended 31 December 2012 of 1.50p per share paid on 15 May 2013	-	808,484		807,428
	Final capital dividend paid for year ended 31 December 2012 of 0.50p per share paid on 15 May 2013	-	269,495		266,329
	Interim income dividend paid for year ended 31 December 2013 of 2.00p per share paid on 18 September 2013	-	-		1,070,141
	Interim capital dividend paid for year ended 31 December 2013 of 2.00 p per share paid on 18 September 2013	-	-		1,070,143
	Final income dividend paid for year ended 31 December 2013 of 1.75p per share paid on 14 May 2014	1,055,637	-		-
	Final capital dividend paid for year ended 31 December 2013 of 1.50p per share paid on 14 May 2014	904,832	-		-
		1,960,469	1,077,979		3,214,041
7.	Basic and diluted net asset value per ordinary share
		As at	As at		As at
		30 June 2014	30 June 2013		31 December 2013
		(unaudited)	(unaudited)		(audited)
		£	£		£
	Net assets	67,878,668	54,005,220		54,268,368
	Number of shares in issue	60,850,032	53,627,282		53,112,565
	Basic and diluted net asset value per ordinary share	111.55p	100.70p		102.18p

8.	Summary of non-current investments at fair value during the period
		Traded	Unquoted	Unquoted	Loan	Total
		on AIM	equity	preference	stock
			shares	shares
		£	£	£	£	£
	Valuation at 1 January 2014	444,789	15,238,816	35,968	23,597,611	39,317,184
	Purchases at cost	30	1,744,448	1,663	5,076,033	6,822,174
	Sales -proceeds	-	(7,925,040)	(1,818)	(5,574,926)	(13,501,784)
	- realised gains	-	2,781,746	-	932,501	3,714,247
	Reclassification at valuation	-	-	-	-	-
	Unrealised gains	38,114	2,034,935	11,972	1,225,202	3,310,223
	Valuation at 30 June 2014	482,933	13,874,905	47,785	25,256,421	39,662,044
	Book cost at 30 June 2014	305,030	8,611,619	47,611	24,042,468	33,006,728
	Permanent impairment in value of investments	-	(701,362)	(3,078)	(832,957)	(1,537,397)
	Unrealised gains at 30 June 2014	177,903	5,964,648	3,252	2,046,910	8,192,713
	Valuation at 30 June 2014	482,933	13,874,905	47,785	25,256,421	39,662,044
	Gains on investments
	Net realised gains based on historical cost	-	6,763,362	-	327,930	7,091,292
	Less amounts recognised as unrealised gains/(losses) in previous years	-	3,981,616	-	(604,571)	3,377,045
	Net realised gains based on carrying value at 31 December 2013	-	2,781,746	-	932,501	3,714,247
	Net movement in unrealised gains in the period	38,114	2,034,935	11,972	1,225,202	3,310,223
	Gains on investments for the six months ended 30 June 2014	38,114	4,816,681	11,972	2,157,703	7,024,470
	Transaction costs of £333,781 were incurred in the period and are deducted in arriving at realised gains on investments in the Income Statement. Deducting these from realised gains above gives £3,380,466 of gains as shown in the Income Statement.
	Purchases above of £6,822,174 differ to that shown in the Cash Flow Statement of £4,321,087 by £2,501,087 which is the accounting cost of ATG sale proceeds received in the form of the acquirer's equity and loan stock of £2,501,087. Sales proceeds above of £13,501,784 differ to that shown in the Cash Flow Statement of £8,741,449 by £4,760,335. This is due to proceeds receivable from the sale of Monsal Holdings Limited of £1,844,502, new equity and loan stock instruments of £2,501,087 received as consideration for the sale of ATG, an ATG equity proceeds retention of £80,965 and transaction costs of £333,781.
	Unrealised gains at 30 June 2014 of £8,192,713 differ to that shown in the Revaluation Reserve of £9,800,394. The difference of £1,607,681 is loan stock received (net of subsequent repayments made) as part of the disposal of DiGiCo Europe Limited in December 2011, which was not recognised as a realised gain in that year.

9.	Debtors and prepayments
				As at		As at		As at
				30 June 2014		30 June 2013		31 December 2013
				(unaudited)		(unaudited)		(audited)
				£		£		£
	Amounts due within one year
	Accrued income			542,766		317,181		593,273
	Prepayments			10,953		9,454		16,032
	Other debtors			2,719,194		173,459		159
				3,272,913		500,094		609,464
	The rise in other debtors is mainly due to the current period containing £788,836 of allotment monies arising from the issue of ordinary shares on 6 June 2014 and £1,844,502 receivable from the completion of the sale of Monsal Holdings Limited. Both were received after the period-end.
10.	Current Investments at fair value
	These comprise investments of £1,633,268 (30 June 2013: £1,632,916; 31 December 2013: £1,633,110 in six OEIC money market funds (five Dublin based and one London based) subject to immediate access, and £11,020,104 (30 June 2013: £8,000,000; 31 December 2013: £8,009,477) in four bank deposit accounts or overnight money market accounts, repayable within one year.
11.	Capital and reserves
		Called	Capital		Share	Revaluation	Special		Profit	Total
		up share	redemption		premium	reserve	distributable		and loss
		capital	reserve		reserve		reserve		account
		£	£		£	£	£		£	£
	At 1 January 2014	531,126	186,520		15,361,612	9,867,216	25,580,251		2,741,643	54,268,368
	Shares issued under Linked Offer for Subscription (note a)	81,741	-		8,115,663	-	(3,489)		-	8,193,915
	Shares bought back	(4,367)	4,367		-	-	(394,540)		-	(394,540)
	Cancellation of share premium account (note b)	-	(186,520)		(18,539,073)	-	18,725,593		-	-
	Realised losses transformed to special reserve (note b)	-	-		-	-	(726,801)		726,801	-
	Realisation of previously unrealised appreciation	-	-		-	(3,377,045)	-		3,377,045	-
	Dividend paid	-	-		-	-	-		(1,960,469)	(1,960,469)
	Profit for the period	-	-		-	3,310,223	-		4,461,171	7,771,394
	At 30 June 2014	608,500	4,367		4,938,202	9,800,394	43,181,014		9,346,191	67,878,668

	Note a: As part of the 2014 Linked Offer for Subscription, a total of 8,174,196 ordinary shares were allotted at average effective offer prices ranging from 100.01 pence to 108.50 pence per share, raising net funds of £8,193,915.
	Shares issued as part of the Joint fundraising offer for subscription per the cash flow statement of £7,405,079 differs to that shown as shares issued above of £8,193,915 by £788,836 being net funds due to the Company arising from shares allotted on 6 June 2014, which was a debtor at the period-end.
	Note b: The cancellation of £18,539,073 from the share premium account and £186,520 from the capital redemption reserve (as approved at the General Meeting held on 22 February 2014 and by order of the Court dated 12 March 2014) has increased the Company's special distributable reserve. 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. All of this reserve arose from shares issued before 5 April 2014.
12.	Post balance sheet events
	On 18 July 2014, the Company made an investment of £1,460,500 to support the management buy-out of Tharstern Limited, a leading supplier of software-based management information systems to the global commercial printing and graphic arts industries.
	On 30 July 2014, the entire holding of DiGiCo Global Limited was realised for net proceeds of £3,370,752.
13.	Financial statements for the year ended 31 December 2013
	The information for the six months ended 30 June 2014 does not comprise full financial statements within the meaning of Section 435 of the Companies Act 2006.  The financial statements for the year ended 31 December 2013 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) of the Companies Act 2006.
14.	Half-Yearly Report
	This Half-Yearly Report is available on, and can be downloaded, from our website: www.migvct.co.uk and is circulated by post to those shareholders who have requested copies of the Report. Further copies are also available free of charge from the Company's registered office, 30 Haymarket, London, SW1Y 4EX.

CONTACT DETAILS FOR ENQUIRIES

Sarah Penfold or Tim Jones at Mobeus Equity Partners LLP (the Company Secretary) on 020 7024 7600 or by e-mail on [e-mail]

Jonathan Gregory at Mobeus Equity Partners LLP (the Investment Adviser), on 020 7024 7600 or by e-mail on [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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