Unaudited Interim Report

FOR IMMEDIATE RELEASE 19 August 2009 Hygea VCT plc Unaudited Interim Report for the six months ending 30 June 2009 Hygea VCT plc ("Hygea", "Company" or "Fund") is a Venture Capital Trust ("VCT") which aims to provide shareholders with attractive long-term returns by investing in quoted and unquoted MedTech companies. The Board manages the Company. The Company was launched in October 2001 and raised over £7.0 million (£6.8 million net of expenses) through an offer for subscription. Financial Summary Six months Year to Six months to to 31 December 30 June 2009 30 June 2008 2008 Net assets (£'000) 6,115 4,619 5,155 Net profit/(loss) after tax 418 (£'000s) 781 (65) Net asset value per share ("NAV") 75.3p 60.1p 66.2p Revenue loss per share (0.8)p (0.9)p (1.6)p Earnings per share 9.9p (0.8)p 5.4p Chairman's Statement I present the results for the six months ended 30 June 2009. I am delighted to report that the Company's net asset value per share at 30 June 2009 was 75.3p compared to 66.2p at 31 December 2008 and 60.1p at 30 June 2008. This increase is the result of continuing progress at DxS and the successful realisation of our investment in BioAnaLab where, post the period end, we have received £822,000 in cash, a realised gain of £544,000 over cost and £93,000 over the previous carrying value with the potential for deferred consideration. Following this realisation, the Company has around £800,000 in cash: your Board proposes to use these funds as follows: a) there are portfolio companies which are making good progress and which are currently undertaking fundraisings - part of the funds will be used to maintain Hygea's holding in those companies, b) subject to the outlook for the portfolio at the year end, we propose to recommence the payment of dividends. Portfolio review At 30 June 2009, the Fund consisted of 15 holdings: five companies quoted on AIM or PLUS Markets and ten unquoted companies. During the period the Company subscribed for further shares in Insense at a total cost of £26,700 and a small further investment in Arecor. Since the period end we have made an investment of £100,000 in Prosurgics at a reduced valuation and have consequently written down our investment to reflect the new fundraising terms. DxS continues to perform well and we have taken the opportunity to further increase our valuation in line with that ascribed by the lead investor. The share prices of the majority of our quoted portfolio valuations have fallen in line with the general market sentiment, but I am pleased to report that Epistem's share price has performed strongly following the collaboration agreement with Novartis announced in March 2009. Also the share price of Omega Diagnostics has strengthened during the period and its final results to March 2009 were encouraging. Shares We have been pleased by the response to the continuation of our top up offer. We have raised a total of £179,000 following the allotment of 327,185 shares at prices between 54p and 57p each. In addition to the issue of new shares we have also seen a small but significant number of transactions in the secondary market and we will continue to take steps to communicate the potential of our portfolio. In view of the current cash position of the Company, it is not presently intended to issue any further shares. We remain committed to our policy of not buying back shares. Value added tax As previously reported, HM Revenue & Customs ("HMRC") have recently agreed that Investment Company management fees are not subject to VAT and that this situation should have applied previously. We have estimated that this refund will amount to £25,000, which is included in our accounts. We are close to agreeing this settlement with HMRC. VCT qualifying status PricewaterhouseCoopers LLP continues to provide the Board with advice on the ongoing compliance with HMRC rules and regulations concerning VCTs. The Board believes that Hygea continues to comply with the conditions laid down by HMRC for maintaining approval as a VCT. Principal Risks and Uncertainties The principal risks and uncertainties are set out in note 6 of the Notes to the Half-Yearly Report on page 11. Outlook We are delighted that our confidence in the portfolio is at last being realised. In the light of the sale of BioAnaLab and the consequent cash position, we will be better able to support our investee companies and hope to be in a position to propose a final dividend for 2009. We continue to have confidence in our strategy of focussing on the MedTech sector by investing in those companies seeking to offer better patient outcomes at lower total cost. James Otter Chairman 19 August 2009 Investment Portfolio Carrying Unrealised value at Investment at profit/(loss) 30 June 2009 Unquoted Investments cost (£'000) (£'000) (£'000) DxS Limited 325 2,133 2,458 BioAnaLab Limited 279 544 823 ImmunoBiology Limited 600 202 802 Hallmarq Veterinary Imaging Limited 885 (276) 609 Wound Solutions Limited 350 (113) 237 Glide Pharmaceutical Technologies Limited 105 195 300 Prosurgics Limited 490 (315) 175 Insense Limited 309 (139) 170 Arecor Limited 2 (1) 1 Purely Proteins Limited 372 (372) - Total unquoted investments 3,717 1,858 5,575 Quoted Investments Scancell Holdings plc 760 (531) 229 EpiStem Holdings plc 62 96 158 Omega Diagnostics plc 75 (23) 52 Stem Cell Sciences plc 89 (87) 2 York Pharma plc 250 (250) - Total quoted investments 1,236 (795) 441 Total investments 4,953 1,063 6,016 Income Statement Six months to 30 June Six months to 30 June Year to 31 December 2009 2008 2008 Revenue Capital Total Revenue Capital Total Revenue Capital Total £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 Gain/(loss) on disposal of fixed asset investments - - - - 3 3 - (25) (25) Gain on valuation of fixed asset investments - 846 846 - 2 2 - 547 547 Gain on valuation of current asset investments - - - - 1 1 - - - Income - - - 6 - 6 7 - 7 Investment management fees - - - - - - - - - VAT management fee rebate - - - - - - 6 19 25 Other expenses (65) - (65) (77) - (77) (136) - (136) (Loss)/profit on ordinary activities before tax (65) 846 781 (71) 6 (65) (123) 541 418 Taxation on (loss)/profit on ordinary activities - - - - - - - - - (Loss)/profit on ordinary activities after tax (65) 846 781 (71) 6 (65) (123) 541 418 Earnings per share - basic and diluted (0.8)p 10.7p 9.9p (0.9)p 0.1p (0.8)p (1.6)p 7.0p 5.4p * the 'Total' column of this statement is the profit and loss account of the Company; the supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies, * all revenue and capital items in the above statement derive from continuing operations, * the accompanying notes are an integral part of the half-yearly report, * the Company has no recognised gains or losses other than those disclosed in the income statement. Reconciliation of Movements in Shareholders' Funds Six months Six months ended 30 June ended 30 June Year to 31 2009 2008 December 2008 £'000 £'000 £'000 Shareholders' funds at start of period 5,155 4,608 4,608 Profit/(loss) on ordinary activities after tax 781 (65) 418 Issue of equity 179 76 129 Shareholders' funds at end of period 6,115 4,619 5,155 Balance Sheet As at 30 June As at 30 June As at 31 2009 2008 December 2008 £'000 £'000 £'000 £'000 £'000 £'000 Fixed asset investments 6,016 4,616 5,142 Current assets: Debtors 36 17 79 Cash at bank 92 15 - 128 32 79 Creditors: amounts falling due within one year (29) (29) (32) Overdraft - - (34) Net current assets 99 3 13 Net assets 6,115 4,619 5,155 Called up equity share capital 4,057 3,841 3,894 Share premium 1,738 1,722 1,722 Special distributable reserve 1,660 1,660 1,660 Capital redemption reserve 38 38 38 Capital reserve - realised (1,595) (1,471) (1,595) - unrealised 1,063 (437) 217 Revenue reserve (846) (734) (781) Total equity shareholders' funds 6,115 4,619 5,155 Net asset value per share 75.3p 60.1p 66.2p Cash flow statement Six months Six months to Year to to 30 June 31 December 30 June 2009 2008 2008 £'000 £'000 £'000 Net cash outflow from operating activities (25) (80) (173) Financial investment Purchase of fixed asset investments (28) (262) (297) Disposal of fixed asset investments - 9 35 Financing Issue of own shares 179 76 129 Increase/(decrease) in cash at bank 126 (257) (306) Reconciliation of Net Cash Flow to Movement in Net Cash Resources Six months Six months to to Year to 30 June 30 June 31 December 2009 2008 2008 £'000 £'000 £'000 Increase/(decrease) in cash at bank 126 (257) (306) Opening net cash resources (34) 272 272 Net cash resources at end of period 92 15 (34) Reconciliation of Profit before Taxation to Cash Flow from Operating Activities Six months to Year to Six months to 30 June 31 December 30 June 2009 2008 2008 £'000 £'000 £'000 Gain/(loss) on ordinary activities before tax 781 (65) 418 (Gain)/loss on valuation of fixed asset investments (846) (2) (547) (Gain)/loss on disposal of fixed asset investments - (3) 25 Decrease/(increase) in debtors 43 (14) (76) (Decrease)/increase in creditors (3) 4 7 Net cash outflow from operating activities (25) (80) (173) Notes to the Half-Yearly Report 1. Basis of preparation The unaudited half-yearly results which cover the six months to 30 June 2009 have been prepared in accordance with the Accounting Standard Board's (ASB) statement on half-yearly financial reports (July 2007) and adopting the accounting policies set out in the statutory accounts of the Company for the year ended 31 December 2008, which were prepared under UK GAAP and in accordance with the Statement of Recommended Practice for Investment Companies issued by the Association of Investment Companies in January 2009. 2. Publication of non-statutory accounts The unaudited half-yearly results for the six months ended 30 June 2009 do not constitute statutory accounts within the meaning of Section 240 of the Companies Act 1985 and have not been delivered to the Registrar of Companies. The comparative figures for the year ended 31 December 2008 have been extracted from the audited financial statements for that year, which have been delivered to the Registrar of Companies. The independent auditor's report on those financial statements under Section 235 of the Companies Act 1985 was unqualified. This half-yearly report has not been reviewed by the Company's auditor. 3. Earnings per share The earnings per share at 30 June 2009 are calculated on the basis of 7,918,276 (31 December 2008: 7,684,458 and 30 June 2008: 7,596,691) being the weighted average number of shares in issue during the period. There are no potentially dilutive capital instruments in issue and, therefore, no diluted returns per share figures are relevant. 4. Net asset value per share The net asset value per share is based on net assets as at 30 June 2009 divided by 8,115,376 (31 December 2008: 7,788,191 and 30 June 2008: 7,682,191) shares in issue at that date. 5. Issue of equity During the six months ended 30 June 2009 the Company issued the following shares: * 3 April 2009: 185,185 shares at a weighted average price of 54.0p, * 5 May 2009: 67,000 shares at a weighted average price of 54.0p, * 15 May 2009: 5,000 shares at a weighted average price of 54.0p, * 19 May 2009: 70,000 shares at a weighted average price of 57.0p. 6. Principal risks and uncertainties The Company's assets consist of equity and fixed interest investments, cash and liquid resources. Its principal risks are therefore market risk, credit risk and liquidity risk. Other risks faced by the Company include economic, loss of approval as a Venture Capital Trust, investment and strategic, regulatory, reputational, operational and financial risks. These risks, and the way in which they are managed, are described in more detail in the Company's Annual Report and Accounts for the year ended 31 December 2008. The Company's principal risks and uncertainties have not changed materially since the date of that report. 7. Related party transactions The Board of Hygea acts as the investment manager ("Commercial Advisory Committee") of the Company. During the period under review, no remuneration was paid to the Board in their capacity as investment manager. The Directors received remuneration for their roles as non-executive Directors to Hygea on the terms as set out in the Directors' Remuneration Report of the Company's Annual Report and Accounts for the year ended 31 December 2008. The Commercial Advisory Committee shall be entitled to receive a performance incentive fee which shall be calculated as 20% of sums returned to shareholders by way of dividends and capital distributions of whatever nature, which in aggregate exceeds the sum of 80p per share (including dividends paid to date, i.e. 1.25p, but excluding any sums returned to shareholders from HMRC in the year of subscription). 8. Copies of this statement are being sent to all shareholders. Copies are also available from the registered office of the Company at 8 Angel Court, London, EC2R 7HP. Enquiries: Charles Breese, Hygea VCT plc on 01280 703482 or larpentnewton@btinternet.com Roland Cornish, Beaumont Cornish Limited on 020 7628 3396 ---END OF MESSAGE--- This announcement was originally distributed by Hugin. The issuer is solely responsible for the content of this announcement.

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