Interim Results

T&G AIM VCT PLC 27 September 2002 T & G AIM VCT PLC INTERIM RESULTS TO 30 JUNE 2002 CHAIRMAN'S STATEMENT I am pleased to give my first interim report as Chairman of T&G AIM VCT plc, following the launch of your Company. In a very difficult fund-raising climate, your Company raised just over £2.7m during the period that is covered in this report - 29 October 2001 (date of incorporation) to 30 June 2002. Investment objective The objective of the fund is to provide shareholders with an attractive return by maximising the stream of dividend distributions to shareholders from both income and capital gains. It is intended to achieve this objective by investing the proceeds of the offers initially in relatively high yield fixed interest securities and thereafter through investment, over time, in a portfolio of qualifying investments predominantly in the shares of AIM companies, or companies which the manager expects will shortly be quoted on AIM. To achieve VCT qualifying status, 70% of the net proceeds raised must be invested in qualifying investments within three years. The directors and the manager will seek to safeguard the capital available for investment in qualifying investments during the initial three years whilst looking to provide short term returns by investing in a portfolio of fixed income securities. Approximately 75% of this portfolio of fixed income securities will be realised over the first three years as and when qualifying investments are made. Net Asset Value The net asset value (NAV) of the Company at 30 June 2002 was 93p per share, compared with the net issue price of 95p. Investments By the end of June, the Company had invested £995,850 amongst three preference shares, two gilt-edged securities and a European Investment Bank bond, with an estimated average gross yield of more than 2% over UK deposit rates. The remaining funds continue to earn interest in a deposit account. It should be noted that where investments are made in corporate bonds, preference shares or indebtedness issued by or on behalf of governments of the UK or any other European Union country, we have to date followed the policy of a credit rating of not less than A minus (Standard & Poors rated) or A3 (Moodys rated). Currently, investment in fixed interest securities looks attractive against a background of low inflation and political uncertainties in most developed countries, including the UK. Outlook We believe the current economic conditions provide a favourable climate for developing a portfolio of qualifying investments. Low price to earnings valuations, availability of management at lower salaries, and generally more favourably priced acquisitions will all support the search for suitable qualifying companies. Since the period end, your Company has made one qualifying investment accounting for 4.8% of funds available for investment - Lloyds British Testing plc. This new issue on AIM specialises in inspection, repair and assembly of heavy lifting equipment, and is well placed to benefit from consolidation of the industry as increasing safety legislation both benefits demand and puts pressure on much smaller competitors. Another three interesting opportunities are currently close to completion and many other possible situations, either new issues or additional share placings by existing AIM companies, are being brought to our attention. A. Wiegman Chairman September 2002 Shareholder communications For general shareholder enquiries, please contact Ben Wereik at Teather & Greenwood Limited on 020 7426 3204 or by email on ben.wereik@teathers.com For enquiries concerning the performance of the fund, please contact John Sweet at Teather & Greenwood Limited on 020 7426 9000 or by email on john.sweet@teathers.com To notify the Company of a change of name or address or to request a dividend mandate form (should you wish to have dividends paid directly into your bank account) please contact the Company's registrars, Capita IRG Plc on 0870 162 310, or write to them at Balfour House, 390-398 High Road, Ilford, Essex IG1 1NQ. FINANCIAL HIGHLIGHTS For the period ended 30 June 2002 Period from 29 October 2001 to 30 June 2002 £'000 Loss before taxation (45) Revenue loss per £1 ordinary share - basic (pence)(1) (1.2)p Capital loss per £1 ordinary share - basic (pence) (1) (3.7)p Investments at valuation and cash at bank 2,548 Net assets per ordinary share (net of issue expenses) (pence) (2) 93p (1) Based on a weighted average of 915,656 ordinary shares in issue during the period. (2) Based on 2,728,979 ordinary shares in issue at 30 June 2002. INDEPENDENT REVIEW REPORT We have been instructed by the company to review the financial information for the period ended 30 June 2002 which comprises the statement of total return, the balance sheet, the cash flow statement and related notes 1 to 6. We have read the other information contained in the interim report and considered whether it contains any apparent misstatements or material inconsistencies with the financial information. Directors' responsibilities The interim report, including the financial information contained therein, is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the interim report in accordance with the Listing Rules of the Financial Services Authority which require that the accounting policies and presentation applied to the interim figures should be consistent with those applied in preparing the preceding annual accounts except where any changes, and the reasons for them, are disclosed. Review work performed We conducted our audit in accordance with the guidance contained in Bulletin 1999/4 issued by the Auditing Practices Board for use in the United Kingdom. A review consists principally of making enquiries of group management and applying analytical procedures to the financial information and underlying financial data and, based thereon, assessing whether the accounting policies and presentation have been consistently applied unless otherwise disclosed. A review excludes audit procedures such as tests of controls and verification of assets, liabilities and transactions. It is substantially less in scope than an audit performed in accordance with United Kingdom auditing standards and therefore provides a lower level of assurance than an audit. Accordingly, we do not express an audit opinion on the financial information. Review conclusion On the basis of our review we are not aware of any material modifications that should be made to the financial information as presented for the period ended 30 June 2002. Deloitte & Touche Chartered Accountants and Registered Auditors London September 2002 STATEMENT OF TOTAL RETURN (unaudited) (incorporating the Revenue Account) Period ended 30 June 2002 Period from 29 October 2001 to 30 June 2002 Notes Revenue Capital Total £'000 £'000 £'000 Income 2 24 24 Decrease in value of fixed interest investments (21) (21) Investment management fee (4) (13) (17) Other expenses (31) - (31) ___________ ___________ __________ LOSS ON ORDINARY ACTIVITIES BEFORE TAXATION (11) (34) (45) Tax on ordinary activities - - - ___________ ___________ __________ LOSS ON ORDINARY ACTIVITIES AFTER TAXATION (11) (34) (45) ___________ ___________ __________ Loss attributable to ordinary shareholders (11) (34) (45) Dividend in respect of ordinary shares - - - ___________ ___________ __________ LOSS TO SHAREHOLDER PER ORDINARY SHARE 3 (1.2)p (3.7)p (4.9)p ___________ __________ __________ The amounts dealt with in the Statement of Total Return are all derived from continuing activities. The revenue column of this statement is the profit and loss account of the Company. The Company has only one class of business and derives its income from investments made in shares and securities and from bank deposits. No operations were acquired or discontinued in the period. The notes on pages 8 and 9 form part of these financial statements. BALANCE SHEET (unaudited) As at 30 June 2002 Note As at 30 June 2002 £'000 FIXED ASSETS Fixed interest investments 4 975 __________ CURRENT ASSETS Debtors and prepayments 46 Cash at bank 1,573 __________ 1,619 CREDITORS: Amounts falling due within one year Other creditors (46) __________ NET CURRENT ASSETS 1,573 __________ NET ASSETS 2,548 __________ CAPITAL AND RESERVES Called up equity share capital 2,593 Capital reserve - realised (13) Capital reserve - unrealised (21) Revenue account (11) __________ TOTAL EQUITY SHAREHOLDERS' FUNDS 2,548 __________ NET ASSET VALUE PER ORDINARY SHARE 93.37p __________ Number of ordinary shares in issue at 30 June 2,728,979 __________ RECONCILIATION OF TOTAL SHAREHOLDERS' FUNDS (unaudited) Period from 29 October 2001 to 30 June 2002 Called up Capital Capital Profit and Total equity equity share reserve reserve loss account shareholder capital realised unrealised funds Net unrealised loss on revaluation of investment - - (21) - Investment management fee charged to - (13) - - (13) capital Net loss for the period - - - (11) (11) Share issue expenses charged to share capital account (136) - - - (136) Ordinary shares issued 2,729 - - - 2,729 __________ __________ __________ __________ __________ MOVEMENT IN TOTAL SHAREHOLDERS' FUNDS 2,593 (13) (21) (11) 2,548 Total shareholder's funds at 29 October 2001 - - - - - __________ __________ __________ __________ __________ TOTAL SHAREHOLDERS' FUNDS AT 30 JUNE 2001 2,593 (13) (21) (11) 2,548 __________ __________ __________ __________ __________ CASH FLOW STATEMENT (unaudited) Period ended 30 June 2002 Period from 29 October 2001 to 30 June 2002 £'000 Operating activities Bank deposit interest received 3 Other cash payments (12) _______________ Net cash outflow from operating activities (9) Investing activities Acquisition of investments (996) _______________ Net cash outflow from investing activities (996) _______________ Cash outflow before financing and management of liquid resources (1,005) _______________ Financing Issue of ordinary shares 2,715 Expenses of the issue of ordinary shares (137) _______________ Net cash inflow from financing 2,578 _______________ Increase in cash for the period 1,573 _______________ RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET FUNDS £'000 Increase in cash for the period 1,573 Net funds at the start of the period - _______________ Net funds at the end of the period 1,573 _______________ NOTES TO THE ACCOUNTS Period ended 30 June 2002 1. ACCOUNTING POLICIES A summary of the principal accounting policies, all of which have been applied consistently throughout the period, is set out below: Basis of accounting The accounts have been prepared under the historical cost convention, modified to include the revaluation of investments, and in accordance with applicable United Kingdom law and accounting standards and with the Statement of Recommended Practice, 'Financial Statements of Investment Trust Companies'. Valuation of investments Listed investments and investments traded on AIM are stated at closing mid-market prices. Where quoted investments are subject to restrictions, an appropriate discount to the latest market price is applied. Realised gains or losses on the disposal of investments are taken to capital reserve - realised. Unrealised gains or losses on the revaluation of investments are taken to capital reserve - unrealised. Income Dividends receivable from equity investments are brought into account on the ex-dividend date. Fixed returns on non-equity investments and on debt securities are recognised on a time apportionment basis. Interest receivable on cash deposits is accounted for on an accruals basis. Expenses All expenses are accounted for on an accruals basis and are charged through the revenue account, except as follows: - expenses which are incidental to the acquisition of an investment are included in the cost of investment; - expenses which are incidental to the disposal of an investment are deducted from the disposal proceeds of the investment; - expenses incurred as a result of an issue of shares are allocated against the share capital account; and - expenses relating to investment management fees (see below). Investment management fees The investment management fees for the manager's services are charged 25% to the revenue account and 75% to the capital account. Capital reserves Gains and losses on the realisation of investments are accounted for in the capital reserve - realised. Increases and decreases in the valuation of investments held at the period end are accounted for in the capital reserve - unrealised. 2. INCOME Period from 29 October 2001 to 30 June 2002 £'000 Unfranked income from fixed asset investments 7 Bank interest 17 __________ 24 __________ 3. LOSS TO SHAREHOLDERS PER ORDINARY SHARE The loss to shareholders per ordinary share has been calculated on the weighted average number of ordinary shares during the period of 915,656. 4. FIXED INTEREST INVESTMENTS As at 30 June 2002 Issuer Description Percentage Valuation of portfolio £ % National Westminster Bank plc 9% non cumulative preference shares 198,920 20.40 Halifax plc 6.125% preference shares 91,736 9.41 Abbey National plc 10.375% non cumulative preference shares 134,999 13.84 European Investment Bank 5.5% 2009 201,120 20.62 Treasury 5% Stock 2004 100,350 10.29 Treasury 7.25% Stock 2007 248,108 25.44 __________ __________ Total fixed interest investments 975,233 100.00 __________ __________ 5. The financial information set out above is unaudited and does not constitute statutory accounts within the meaning of section 240 of the Companies Act 1985. 6. A copy of this statement has been sent today to the company's shareholders, and members of the public may obtain a copy on application to the company's registered office. A copy of this document will be submitted to the UK Listing Authority and will be available at the UK Listing Authority's Document Viewing Facility which is situated at Financial Services Authority, 25 The North Colonnade, Canary Wharf, London E14 5HS. This information is provided by RNS The company news service from the London Stock Exchange

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