Results for the six months ended 30 September 2020

RNS Number : 4523F

Triple Point Inc VCT - TPVE

16 November 2020

 

16 November 2020

Triple Point Income VCT plc

(the "Company")

RESULTS FOR THE SIX MONTHS ENDED 30 SEPTEMBER 2020

The Directors of Triple Point Income VCT plc are pleased to announce the unaudited results for the six months ended 30 September 2020.

You may view the Interim Report in due course on the Triple Point website: www.triplepoint.co.uk . Please note that page numbers in this announcement are in reference to the Interim Report.

FOR FURTHER INFORMATION ON THE COMPANY, PLEASE CONTACT:

Triple Point Investment Management LLP   (Investment Manager)	Tel: [phone]
Ben Beaton   Belinda Thomas

The Company's LEI is 213800IXD8S5WY88L245.

Further information on the Company can be found on its website https://www.triplepoint.co.uk/current-vcts/triple-point-income-vct-plc/s1238/ .

Financial Summary

Six months ended 30 September 2020
		C Shares	D Shares	E Shares		Total
Net assets	£'000	11,184	7,970	27,882		47,036
Net asset value per share	Pence	83.20p	58.60p	96.31p		n/a
Net profit before tax	£'000	255	182	330		767
Earnings per share	Pence	1.83p	1.09p	1.12p		n/a
Cumulative return to Shareholders (p)
Net asset value per share		83.20	58.60	96.31
Dividends paid		73.50	70.00	11.50
Net asset value plus dividends paid		156.70	128.60	107.81
Year ended 31 March 2020
		C Shares	D Shares	E Shares		Total
Net assets	£'000	11,406	8,559	29,442		49,407
Net asset value per share	Pence	84.87p	62.46p	101.69p		n/a
Net profit before tax	£'000	746	86	1,217		2,049
Earnings per share	Pence	5.29p	0.12p	4.13p		n/a
Cumulative return to Shareholders (p)
Net asset value per share		84.87	62.46	101.69
Dividends paid		70.00	65.00	5.00
Net asset value plus dividends paid		154.87	127.46	106.69
Six months ended  30 September 2019
Unaudited		C Shares	D Shares	E Shares		Total
Net assets	£'000	17,851	15,557	29,340		62,748
Net asset value per share	Pence	132.80p	113.54p	101.35p		n/a
Net profit/(loss) before tax	£'000	459	203	(333)		329
Earnings/(loss) per share	Pence	3.22p	1.20p	(1.21p)		n/a
Cumulative return to shareholders (p)
Net asset value per share		132.80	113.54	101.35
Dividends paid		20.00	15.00	-
Net asset value plus dividends paid		152.80	128.52	101.35

Triple Point Income VCT plc ("the Company") is a Venture Capital Trust ("VCT"). The Investment Manager is Triple Point Investment Management LLP ("TPIM" or "Triple Point"). The Company was incorporated in November 2007 and currently has three classes of issued ordinary shares:

· C Ordinary Shares ("C Shares"): these are the shares issued in the Offer that closed on 27 May 2014. A total of £14 million was raised and 13,441,438 C Shares were issued.

· D Ordinary Shares ("D Shares"): these are the shares issued in the Offer that closed on 30 April 2015. A total of £14.3 million was raised and 13,701,636 D Shares were issued.

· E Ordinary Shares ("E Shares"): these are the shares issued in the Offer that closed on 15 May 2017. Just under £30 million was raised and 28,949,575 E Shares were issued.

Key Highlights

· C Shares Cumulative Dividends Paid: 73.50p ( A dividend of 3.50 pence per C Share was paid on 30 June 2020).

· D Shares Cumulative Dividends Paid: 70.00p ( A dividend of 5.00 pence per D Share was paid on 30 June 2020).

· E Shares Cumulative Dividends Paid: 11.50p ( A dividend of 6.50 pence per E Share was paid on 30 June 2020).

·     Total Return per C Share*: 156.70p ( Total Return for the C Share Class was 156.70 pence per share, which includes cumulative dividends paid of 73.50 pence per C share).

· Total Return per D Share*: 128.60p ( Total Return for the D Share Class was 128.60 pence per share, which includes cumulative dividends paid of 70.00 pence per D share).

· Total Return per E Share*: 107.81p ( Total Return for the E Share Class was 107.81 pence per share, which includes cumulative dividends paid of 11.50 pence per E share).

*Total Return is made up by current Net Asset Value plus Dividends paid to date. Total Return is defined as an Alternative Performance Measure ("APM"). Total Return, calculated by reference to the cumulative dividends paid plus net asset value (excluding tax reliefs received by shareholders), is the primary measure of performance in the VCT industry.

Chairman's Statement

I am pleased to present the Interim Report for the Company for the period ended 30 September 2020.

The continuing COVID-19 global pandemic has presented a wide-ranging set of challenges that span public policy, economics and renewable energy to mention a few. Each one has been, and continues to be, extraordinary in both complexity and impact.  

The depth and speed of the economic contraction across the developed world is unparalleled in modern times and it appears extremely optimistic to believe that by the end of 2021 we will be back to where we were at the start of the year. As I write, England has just entered a second national lockdown. The social, economic and financial impact of COVID-19 has been, and remains, immense, uncertainty over the nature and timing of recovery remains.

Many individual businesses and certain business sectors have required recapitalisation, with huge damage caused to fragile supply chains and with heavily dented consumer confidence. Few business models remain truly unaffected. For at least the next year, and likely longer than that, economic prospects will be heavily influenced by the nature of the recovery from the pandemic and how long-lasting the effects of the resultant recession prove to be.

The food system in the UK continues to be under strain and t he E Share Class investment into the vertical growing solution, Perfectly Fresh Cheshire Limited ("PFC"), continues to help bridge this gap. The business has continued to operate despite the obstacles provided by the pandemic. Through this period, PFC has liaised closely with its main customer in its response to COVID-19, and I am delighted to say that it has been able to greatly support them with the product continuing to be grown, delivered on time and as requested.

Reflecting the severity and timing of COVID-19 measures, power demand was significantly reduced at the peak of movement restrictions across the UK, the average demand is running approximately 10% below 2019 levels. Short-term power prices have seen extreme volatility as a result of the COVID-19 pandemic and associated first lockdown. The Company's investments in both hydroelectric schemes and rooftop solar companies have been somewhat insulated from this volatility as the majority of revenues are generated from renewable incentive schemes. As a result, the valuations have been minimally affected.

Investment Portfolio

The Company's funds at 30 September 2020 are invested in a portfolio of VCT qualifying and non-qualifying quoted and unquoted investments. At 30 September 2020 t he Company continues to meet the condition that at least 80% by value of the Company's investments are represented by qualifying holdings.

The Investment Manager's review on pages 15 to 24 gives an update on the portfolio of investments in 17 small unquoted businesses and one quoted Real Estate Investment Trust.

Regulation

Legislation introduced through the Finance Act 2018 began to apply to the Company from 1 April 2020, implementing an increase in the qualifying investment test to 80%. The Investment Manager continues to monitor this ratio closely and the Board is pleased that the Company comfortably navigated the transition period and continues to meet the new requirements.

In line with HMRC guidance, any new investments made by the Company are now self-assured by the Board and the Investment Manager on a case-by-case basis and always with confirmation from professional advisers that they are Qualifying Investments. Advance Assurance is sought where there is an element of uncertainty or doubt over the application of the rules.

The Company continued to satisfy all other tests relevant to its status as a Venture Capital Trust.

C Share Class

The C Share Class has investments in three companies in the Hydroelectric power sector , which between them own six hydroelectric schemes in the Scottish Highlands . All schemes have been successfully commissioned and continue to operate in line with expectations.

I am pleased to report the C Share Class has recorded a profit over the period of 1.83 pence per share. At 30 September 2020 the net asset value stood at 83.20 pence per share. Adding back the total dividends paid to date takes the total return, including the net asset value, to 156.70 pence per share.

The original target for the C Share Class was to return 100.00 pence per share by the end of year six, comprising the income tax rebate, four annual tax-free dividends of an average 5.00 pence per share, followed by a partial realisation of 50.00p. Thereafter an ongoing dividend of around 3.50p per annum is targeted for a further nine years and a final capital realisation of c.50 pence per share in 2029 following the sale of the Company's hydro projects. I am pleased to say that the Company is achieving this target for C Shareholders.

The Company has to date returned 73.50 pence per share to Shareholders: including the initial tax relief this is a return of over 100 pence per share.

The Board continues to monitor investment activity across the wider hydro sector and will consider on a regular basis if it is in shareholders' interests to retain or realise the portfolio on a regular basis.

D Share Class

The D Share Class has investments in five companies in the Hydroelectric power sector, which between them own six hydroelectric schemes in the Scottish Highlands . All schemes have now been commissioned and are now operating in line with expectations.

The original target for the D Share Class was to return 100.00 pence per share by the end of year six, comprising the income tax rebate, four annual tax-free dividends of an average 5.00 pence per share, followed by a partial realisation of 50.00p. Thereafter an ongoing dividend of around 3.50p per annum is targeted for a further nine years and a final capital realisation of c.50 pence per share in 2030 following the sale of the Company's hydro projects.

I am pleased to say that the Company is achieving this target for D Shareholders. The Company has to date returned 70.00 pence per share to Shareholders: including the initial tax relief this is a return of 100 pence per share.

T he D Share Class has recorded a profit over the period of 1.09 pence per share. At 30 September 2020 the net asset value stood at 58.60 pence per share. Adding back the total dividends paid takes the total return, including the net asset value, to 128.60 pence per share.

The Board continues to monitor investment activity across the wider hydro sector and will consider on a regular basis if it is in shareholders' interests to retain or realise the portfolio on a regular basis.

E Share Class

The E Share Class holds a diverse portfolio of investments spanning sectors such as vertical growing and energy production from gas fired energy centres, solar and hydro. While the E Share Class is at an earlier stage in its life cycle in comparison to the C and D Share Class, the Board is pleased with its progress to date.

The E Share Class recorded a profit over the period of 1.12 pence per share as a result of revaluation of investments. At 30 September 2020 the net asset value stood at 96.31 pence per share.

The E Share Class declared a second dividend of 6.5 pence per share on 4 June 2020. This dividend was paid to Shareholders on 30 June 2020. This payment takes total dividends paid to E Shareholders to 11.5 pence per share.

Outlook

The speed and extent to which COVID-19 has changed daily life is hard to overstate. Whilst the first wave of the pandemic appeared to be behind us and movement restrictions were being clarified, uncertainty has increased, particularly in the short term as England has entered a second national lockdown. We do not yet know how quickly economies will recover or for how long governments can continue to run up such enormous deficits.

In June 2019, the UK parliament adopted a net zero emissions target for 2050, going further than previous legislation, which mandated 80% emission reductions by 2050. Decarbonisation of the electricity sector, primarily through renewable generation, will be critical to achieving this. The Company continues to support this target through all its Share Classes and their investments in hydroelectricity, solar and gas fired energy centres. The UK still experiences significant peaks and troughs in energy consumption. Gas fired energy centres help to solve these short-term peaks in the electricity demand profile. Natural gas neatly bridges the gap between environmentally unfriendly fossil fuels and more irregular solar and wind power.

The UK left the EU on 31January 2020 and then entered into the transition period. The period during which an extension could be requested expired at the end of June, suggesting that both parties now must agree on a trade deal by December 2020. There continues to be a risk that both parties may not agree a deal, though this remains uncertain. With the UK officially leaving the EU's internal energy market at the end of the year, both the UK Government and European Commission have stated that they are keen on maintaining a strong co-operation on energy policy and will establish a new energy trade deal. Given the UK focus of the Company and the sectors the Company operates within, we do not expect that Brexit will have a significant impact on the current operations of the Company.

If you have any questions or comments, please do not hesitate to contact Triple Point on 020 7201 8989.

David Frank

Chairman

16 November 2020

Investment Manager's Review

Sector Analysis

The unquoted investment portfolio can be analysed as follows:

			Electricity Generation		SME Funding
Industry Sector	Crematorium Management	Vertical Growing	Hydroelectric Power	Other Electric Power	Hydroelectric Power	Other	Quoted Investments	Total Investments
	£'000	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Investments at 30 September 2020
C Shares	-	-	11,342	-	-	-	-	11,342
D Shares	-	-	10,036	-	-	-	-	10,036
E Shares	97	6,282	5,812	7,872	3,348	2,717	590	26,718
Total	97	6,282	27,190	7,872	3,348	2,717	590	48,096
Total investments %	0.20%	13.06%	56.53%	16.37%	6.96%	5.65%	1.23%	100.00%

C Share Class

Hydroelectric Power

100%

D Share Class

Hydroelectric Power

100%

E Share Class

Crematorium Management	1%
Vertical Growing	24%
Quoted Investments	2%
Hydroelectric Power	22%
SME Funding - Hydroelectric Power	13%
SME Funding - Other	10%
Electricity Generation - Other	28%

We have the pleasure in presenting our interim review of the six months ended 30 September 2020.

The VCT was established to fund small and medium-sized enterprises. At 30 September 2020 it had three share classes, each invested in their own portfolio. The overall portfolio comprised investments in 17 small, unquoted companies and one quoted Real Estate Investment Trust, across five sectors: crematorium management, electricity generation, vertical growing, SME funding and investment property.

At 30 September 2020 the Company continues to meet the condition that at least 80% of relevant funds must be invested in VCT qualifying investments within three years.

Review and Future Developments

In the six months that this Interim Report covers we have been confronted with rapidly changing data related to the social, political and increasingly financial impact of the response to the COVID-19 pandemic. The onset of significant travel restrictions and other social distancing measures, in the United Kingdom and across over 80% of the world's population, in response to managing the public health fallout from the disease, will have serious consequences for economic and financial conditions. The health and economic impacts of the pandemic have highlighted areas of structural weakness in the global economy, particularly in relation to sustainability and the vulnerability of supply chains.

One of the few beneficial effects of the reduction in activity caused by the COVID-19 pandemic has been the short-term reduction in carbon emissions globally and improved air quality. With a clear and pressing need for economic stimulus to drive economic recovery, there is broad political support in the EU and the UK to use recovery funds as a means to drive forward the energy transition to a future without greenhouse gas emissions.  

Energy Investments - Active Asset Management

All Share Classes within the Company remain fully invested, both the C and D Share Classes are exclusively invested across companies in the hydroelectric power sector. The E Share Class contains investments across the hydroelectric power sector, gas power sector, rooftop solar, crematorium management, vertical growing, SME funding and investment property.

Despite the ongoing pandemic and the change in electricity demand profile, investments across the hydroelectric power, gas power sector and rooftop solar within the C, D and E share classes continue to generate electricity with minimal disruption.

The companies across all Share Classes in the electricity generation sectors have been minimally affected by the COVID-19 pandemic, there have been minimal supply chain disruptions leading to no substantial delays in the sourcing of any key components for the hydroelectric, solar or gas fired energy projects. Triple Point continue to liaise with our Operation and Maintenance contractors across all companies to try and avert any potential future delays in the procurement process.

Triple Point continue to work actively to both increase the value of the Company's electricity generation portfolio through operational improvements in the underlying assets and to protect value where market conditions have deteriorated. This is best illustrated by fixing power prices in the near term. Other areas where hands-on asset management delivers additional shareholder value is in relation to the negotiation of major commercial contracts including the power purchase agreements for each individual site and operation and maintenance agreements.

Triple Point continue to seek to reduce operating costs on a project by project basis by, for example, successfully appealing business rates assessments which has delivered significant savings for investee companies.

C Share Class

The Company and the Investment Manager continue to monitor the ongoing operation and efficiency of the C Share Class investments. The C Share Class has investments in three hydroelectric companies which, between them, own six schemes in the Scottish Highlands.

D Share Class

The D Share Class has investments in five hydroelectric companies which between them own six hydroelectric schemes in the Scottish Highlands. All six schemes have been commissioned and are fully operational.

E Share Class

The E Share Class has successfully deployed its funds into various investments in a diverse range of sectors.

Hydroelectric Power

The E Share Class has investments in nine companies which own, either directly or indirectly, hydroelectric schemes in the Scottish Highlands.

The ten hydroelectric schemes are all "run of river" plants and each company benefits from government backed Feed-in-Tariff (FiT) payments based on output and from the sale of the electricity produced to utilities or other power companies under Power Purchase Agreements (PPAs). These contracts allowed the companies to avoid the volatility experienced in power markets during the earlier days of the pandemic.

Although rainfall variability is to be expected over the 40-year period of generation which our hydroelectric companies are expected to experience, overall, we continue to be pleased with the efficiency of the hydroelectric schemes owned by them. The hydroelectric companies remain highly focused on improving efficiencies and maximising output and are working alongside hydro experts to further enhance performance.

During the six months to 30 September 2020, the hydroelectric companies generated 5,773 MWh of electricity. Based on an average of 3.8 MWh annual use per household, the hydroelectric companies generated enough electricity to power the equivalent of 1,519 homes during the period.

As we highlighted in our review accompanying the Annual Report the hydroelectric companies, together with other industry members and the British Hydropower Association, had been lobbying the Scottish Government to recognise the concern on business rates in the hydro sector. As a result of this, the Tretton Review report was published in January 2020, which unfortunately found that no changes to business rates would be applied.

This was very disappointing news for us and the Hydro Companies. 

The report suggests temporary government reliefs, which do not apply equally across the sector and are not guaranteed, should continue, rather than recommending an industry-preferred permanent solution to the unfair rateable value increase in 2017 which far outstripped that faced by other businesses.

The British Hydropower Association, along with other industry members, continues to pursue this matter and is putting forward different ideas to the Scottish Government.

In the six-month period to 30 September 2020, our hydro companies have all successfully applied for and received the applicable rates relief from the Highland Council for the financial year 2020/21.

Crematorium Management

The Company has an investment in a business that provides crematory and mercury abatement services for the crematoria of a London Borough. This investment receives revenues from local authorities and has consistently generated a steady return over the years it has been held. 

Solar

After a successful review and intervention to improve performance of the Digima portfolio, all four portfolios are now performing in line with or exceeding expectations. Excellent irradiation during the period made for generation ~11% above expectations for the portfolio. Availability has mostly held stable since restrictions caused by the COVID-19 pandemic prevented maintenance from taking place.

Vertical Growing

The E Share Class has invested in Perfectly Fresh Cheshire Limited ("PFC"), a company which has constructed a pioneering vertical growing facility. Vertical Growing is the practice of producing food in an indoor growing amenity where all inputs (water, light and nutrients) meet the optimum needs of the crop. Vertical Growing facilities are designed to have a sealed environment, meaning that the product is grown in a controlled manner, with positive air pressure to prevent any contaminants entering the facility. This ensures that insects and other pests cannot access the crop, thus removing the need to use pesticides on the crop being grown. A large variety of produce can be grown including herbs and salad leaves.

Expert in horticulture, PFC has recently expanded their growing facilities to cater for a growing number of customers, including two of the United Kingdom's largest supermarket brands.

Its operations currently span over 1,100 square metres and are a pioneering example of the latest technology being harnessed to meet the growing needs of an ever-expanding population.

The COVID-19 pandemic has highlighted the need for greater food security, it is expected that this will continue to be an item high on the government agenda. We believe that PFC is poised to capitalise on this changing landscape while it could see an active increase in valuations across the sector.

Gas Power

The Company has an investment in Green Peak Generation Limited which has constructed a gas fired energy centre that provides a reliable and secure energy supply. The energy centre was commissioned during May 2018 and it consists of containerised gas combustion engines that generate electricity for onward sale, especially at times when there is high demand for power.

The energy centre utilises simple technology, provided by Rolls-Royce, which can respond rapidly to grid fluctuations to deliver a reliable and secure energy supply.

Gas is purchased from the National Transmission System and combusted in the engines to generate electricity. The electricity is then exported to the grid and sold under a Power Purchase Agreement. The company receives revenues from the sale of electricity and additional income from embedded benefits.

During the six-month period to 30 September 2020, the energy centre generated 10,340 MWh of electricity. Based on an average of 3.8 MWh annual use per household, this was enough electricity for 2,721 homes during the period.

Outlook

The economic outlook for the UK continues to remain highly uncertain. While some countries have begun to rebound as they have reopened from lockdowns, investment and realisation activity remains well below pre-COVID levels in most economies.

The speed of recovery will depend on many factors including how the pandemic evolves, medical interventions, policy responses, and general consumer and business sentiment. The recovery is unlikely to be linear and, for most economies, economic activity may not return to pre-COVID levels until 2022. While our portfolio companies have been affected in the short term, albeit minimally, we are of the view that there will be a negligible effect on valuations due to the nature of the Company's investments and that the majority of the portfolio are the beneficiaries of inflation-linked income through FITs or Renewable Obligation Certificates. The impact of COVID-19, and the Government's response to it, should therefore be relatively minor on these revenue streams and not materially impact the ongoing NAV of these businesses.

Brexit

The Investment Manager and the Board continue to keep the possible impact of Brexit on the Company under review. The Company's strategy of investing in small UK based businesses means that it is unlikely to be directly exposed to the terms of an exit from the EU.  We are, however, going through a period of some political and, potentially, economic uncertainty. We believe that by investing carefully, monitoring our portfolio rigorously and providing support to the businesses in which we have invested we can minimise the effects of this uncertainty.  

If you have any questions, please do not hesitate to call us on 020 7201 8989.

Ben Beaton

Partner

Triple Point Investment Management LLP

16 November 2020

Investment Portfolio Summary

	Unaudited					Audited
	30 September 2020					31 March 2020
	Cost		Valuation			Cost		Valuation
	£'000	%	£'000	%		£'000	%	£'000	%
Unquoted qualifying holdings	30,966	79.57	41,133	84.47		30,980	73.62	41,144	79.95
Quoted non-qualifying holdings	570	1.47	591	1.21		3,319	7.89	2,927	5.69
Unquoted non-qualifying holdings	6,760	17.38	6,372	13.09		7,082	16.83	6,692	13.00
Financial assets at fair value through profit or loss	38,296	98.42	48,096	98.77		41,381	98.34	50,763	98.64
Cash and cash equivalents	611	1.58	611	1.23		701	1.66	701	1.36
	38,907	100.00	48,707	100.00		42,082	100.00	51,464	100.00
Qualifying Holdings
Unquoted
Solar
Digima Limited	1,262	3.24	1,661	3.41		1,262	3.00	1,661	3.23
Digital Screen Solutions Limited	2,020	5.19	2,586	5.31		2,020	4.80	2,586	5.02
Green Energy for Education Limited	475	1.22	1,260	2.59		475	1.13	1,260	2.45
Hydroelectric Power
Elementary Energy Limited	2,060	5.29	2,461	5.05		2,060	4.90	2,461	4.78
Green Highland Allt Choire A Bhalachain (255) Limited	3,130	8.04	3,763	7.73		3,130	7.44	3,763	7.31
Green Highland Allt Ladaidh (1148) Limited	3,500	9.00	4,771	9.80		3,500	8.32	4,771	9.27
Green Highland Allt Luaidhe (228) Limited	1,995	5.13	2,425	4.98		1,995	4.74	2,425	4.71
Green Highland Allt Phocachain (1015) Limited	3,931	10.10	4,989	10.24		3,932	9.34	4,989	9.69
Green Highland Shenval Limited	1,120	2.88	739	1.52		1,120	2.66	739	1.44
Achnacarry Hydro Ltd	4,273	10.98	7,830	16.08		4,286	10.18	7,841	15.24
Gas Power
Green Peak Generation Limited	2,200	5.65	2,366	4.86		2,200	5.23	2,366	4.60
Vertical Growing
Perfectly Fresh Cheshire Limited	5,000	12.85	6,282	12.90		5,000	11.88	6,282	12.21
	30,966	79.57	41,133	84.47		30,980	73.62	41,144	79.95

	Unaudited					Audited
	30 September 2020					31 March 2020
	Cost		Valuation			Cost		Valuation
Non-Qualifying Holdings	£'000	%	£'000	%		£'000	%	£'000	%
Quoted
Investment property
Triple Point Social Housing REIT Plc - Equity	570	1.47	591	1.21		3,319	7.89	2,927	5.69
	570	1.47	591	1.21		3,319	7.89	2,927	5.69
Unquoted
Crematorium Management
Furnace Managed Services Limited	486	1.25	98	0.20		486	1.15	97	0.19
Hydroelectric Power
Elementary Energy Limited	140	0.36	140	0.29		200	0.48	199	0.39
Green Highland Allt Choire A Bhalachain (255) Limited	72	0.19	72	0.15		223	0.53	223	0.43
Green Highland Allt Luaidhe (228) Limited	-	-	-	-		109	0.26	110	0.21
Green Highland Allt Phocachain (1015) Limited	-	-	-	-		-	-	-	-
Green Highland Renewables (Achnacarry) Limited	-	-	-	-		-	-	-	-
SME Funding
Hydroelectric Power:
Broadpoint 2 Limited	1,334	3.43	1,334	2.74		1,335	3.17	1,334	2.59
Broadpoint 3 Limited	2,010	5.17	2,010	4.13		2,010	4.78	2,010	3.91
Other:
Aeris Power Limited	518	1.33	518	1.06		519	1.23	519	1.01
Funding Path Limited	2,200	5.65	2,200	4.52		2,200	5.23	2,200	4.27
	6,760	17.38	6,372	13.09		7,082	16.83	6,692	13.00

Principal Risks and Uncertainties

The Directors seek to mitigate the Company's principal risks by regularly reviewing performance and monitoring progress and compliance. In the mitigation and management of these risks, the Directors carry out a robust assessment of the Company's emerging and principal risks, including those that would threaten its business model, future performance, solvency or liquidity.

The main areas of risk identified by them, along with the risks to which the Company is exposed through its operational and investing activities, were described in detail in the Company's last Annual Report.

VCT Qualifying Status Risk: the Company is required at all times to observe the conditions laid down in the Income Tax Act 2007 for the maintenance of approved VCT status. The loss of such approval could lead to the Company losing its exemption from corporation tax on capital gains, to investors being liable to pay income tax on dividends received from the Company and, in certain circumstances, to investors being required to repay the initial income tax relief on their investment. 

Mitigation: The Investment Manager keeps the Company's VCT qualifying status under continual review and reports to the Board on a quarterly basis. The Board has also appointed Philip Hare & Associates LLP to undertake an independent VCT status monitoring role.

Investment Risk : the Company's VCT qualifying investments will be held in small and medium-sized unquoted investments which, by their nature, entail a higher level of risk and lower liquidity than investments in large quoted companies. This could make it difficult to realise investments in line with the relevant strategy.

Mitigation: The Directors and Investment Manager aim to limit the risk attached to the portfolio as a whole by careful selection and timely realisation of investments, by carrying out rigorous due diligence procedures and by maintaining a spread of holdings in terms of industry sector and geographical location. The Board reviews the investment portfolio with the Investment Manager on a regular basis.

Financial Risk : as a VCT the Company is exposed to market price risk, credit risk, fair value risk, liquidity risk and interest rate risk. As most of the Company's investments will involve a medium to long-term commitment and will be relatively illiquid, the Directors consider that it is inappropriate to finance the Company's activities through borrowing, other than for short-term liquidity.

Mitigation: The key elements of financial risk were discussed in detail in the Company's last Annual Report.

Failure of Internal Controls Risk : the Board regularly reviews the system of internal controls, both financial and non-financial, operated by the Company and the Investment Manager. These include controls designed to ensure that the Company's assets are safeguarded and that proper accounting records are maintained.

Mitigation: The Board maintains a risk register which sets out the risks affecting both the Company and the investee companies in which the Company is invested. This risk register is reviewed and updated at least annually to ensure that procedures are in place to identify the principal risks which may affect the Company and its portfolio companies, mitigate and minimise the impact of those risks should they crystallise and to identify emerging risks and to determine whether any actions are required. This enables the Board to carry out a robust assessment of the risks facing the Group, including those risks that would threaten its business model, future performance, solvency or liquidity.

Liquidity Risk: In line with t he Company's initial mandate for the C and D Share Classes the Company has entered into a short-term loan facility of £2.3 million which has repayment terms of 364 days. The Company currently has £611k of cash. This therefore poses a slight risk to the Company's liquidity and cash flow prospects.

Mitigation: The Company and the lender have reviewed longer-term cash flow forecasts and the Company is comfortable that it will generate sufficient cash from its current investments to service and repay the borrowing. The Company keeps an open dialogue with the lender and will continue to update the lender on the outlook for its loan and on the performance of the Company's investment portfolio. The lender has indicated its willingness to extend the facility if required. T he Company has entered into a similar facility agreement with a different lender which includes the same key terms, but also has a two year availability period. This agreement was put in place to mitigate the risk of the existing loan facility not being extended by the existing lender.   

Emerging Risks

COVID-19

The impact of COVID-19 is discussed at length in both the Chairman's Statement on pages 8 to 13 and the Investment Manager's Review on pages 15 to 24.

Brexit

Following the United Kingdom's withdrawal from the European Union ("EU") on 31 January 2020, the Investment Manager and the Board continue to keep the impact of Brexit on the Company under review. Despite the UK having now left the EU the current economic outlook and potential impact from Brexit is relatively unknown as the terms of the UK's exit has not been finalised with the EU. Any potential impact of the UK's withdrawal is difficult to quantify. 

The Company's strategy of investing in small UK-based businesses, however, means that it is unlikely to be directly exposed to the terms of any future deals negotiated with the EU. We are, however, going through a period of some political and economic uncertainty.

We believe that by investing carefully, monitoring our portfolio rigorously and providing support to the businesses in which we have invested, we can minimise the effects of this uncertainty.

Directors' Responsibility Statement

The Directors have elected to prepare the Interim Financial Report for the Company in accordance with International Financial Reporting Standards ("IFRS").

In preparing the Interim Financial Report for the six month period to 30 September 2020, the Directors confirm that, to the best of their knowledge, this condensed set of financial statements has been prepared in accordance with International Accounting Standard 34 "Interim Financial Reporting" as adopted by the European Union and that the Chairman's statement on pages 3 and 4 includes a fair review of the information required by DTR 4.2.7 and DTR 4.2.8 of the Disclosure and Transparency rules of the United Kingdom's Financial Conduct Authority namely:

a)  the Interim Financial Report includes a fair review of important events during the period and their effect on the Financial Statements and a description of specific risks and uncertainties for the remainder of the accounting period;

b)  the Interim Financial Report gives a true and fair view in accordance with IFRS of the assets, liabilities, financial position and of the results of the Company for the period and complies with IFRS and the Companies Act 2006; 

c)  the Interim Financial Report includes a fair review of related party transactions and changes therein. There were no related party transactions for the accounting period; and

d)  the Directors believe that the Company has sufficient financial resources to manage its business risks in the current uncertain economic outlook.

The Directors have reasonable expectations that the Company has adequate resources to continue in operational existence for at least the next 12 months. Thus, they continue to adopt the going concern basis of accounting in preparing the financial statements.

This Interim Financial Report has not been audited or reviewed by the auditors.

David Frank

Chairman

16 November 2020

Unaudited Statement of Comprehensive Income

For the Six months ended 30 September 2020

		Unaudited				Audited				Unaudited
		Six months ended				Year ended				Six months ended
		30 September 2020				31 March 2020				30 September 2019
	Note	Rev.	Cap.	Total		Rev.	Cap.	Total		Rev.	Cap.	Total
		£'000	£'000	£'000		£'000	£'000	£'000		£'000	£'000	£'000
Income
Investment income	4	1,285	-	1,285		2,743	-	2,743		1,563	-	1,563
Loss arising on the disposal of investments during the year		-	(204)	(204)		-	(181)	(181)		-	-	-
Gain/(loss) arising on the revaluation of investments at the year end		-	414	414		-	1,076	1,076		-	(448)	(448)
Investment return		1,285	210	1,495		2,743	895	3,638		1,563	(448)	1,115
Investment management fees	5	362	121	483		896	297	1,193		454	151	605
Other expenses		193	-	193		393	-	393		181	-	181
Finance costs		52	-	52		3	-	3		-	-	-
		607	121	728		1,292	297	1,589		635	151	786
Profit before taxation		678	89	767		1,451	598	2,049		928	(599)	329
Taxation	7	(73)	23	(50)		(180)	57	(123)		(109)	29	(80)
Profit after taxation		605	112	717		1,271	655	1,926		819	(570)	249
Other comprehensive income		-	-	-		-	-	-		-	-	-
Total comprehensive income		605	112	717		1,271	655	1,926		819	(570)	249
Basic and diluted earnings/(loss) per share (pence)
C Share	8	2.00p	(0.17p)	1.83p		4.18p	1.11p	5.29p		3.50p	(0.28p)	3.22p
D Share	8	1.21p	(0.12p)	1.09p		2.61p	(2.49p)	0.12p		1.44p	(0.24p)	1.20p
E Share	8	0.59p	0.52p	1.11p		1.21p	2.92p	4.13p		0.52p	(1.73p)	(1.21p)
		3.80p	0.23p	4.03p		8.00p	1.54p	9.54p		5.46p	(2.25p)	3.21p

The Total column of this statement is the Statement of Comprehensive Income of the Company prepared in accordance with International Financial Reporting Standards (IFRS). The supplementary Revenue Return and Capital 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. This Statement of Comprehensive Income includes all recognised gains and losses.

The accompanying notes are an integral part of this statement.

Unaudited Balance Sheet

At 30 September 2020

		Unaudited		Audited		Unaudited
		30 September 2020		31 March 2020		30 September 2019
	Note	£'000		£'000		£'000
Non-current assets
Financial assets at fair value through profit or loss		48,096		50,763		53,713
Current assets
Receivables		1,239		785		1,157
Cash and cash equivalents	9	611		701		8,151
		1,850		1,486		9,308
Total Assets		49,946		52,249		63,021
Current liabilities
Payables and accrued expenses		448		430		20
Current taxation payable		162		112		254
Short-term debt facility		2,300		2,300		-
		2,910		2,842		274
Net Assets		47,036		49,407		62,747
Equity attributable to equity holders of the parent
Share capital		560		561		561
Share redemption reserve		1		-		-
Share premium		28,661		28,661		28,661
Special distributable reserve		10,855		12,960		26,887
Capital reserve		6,956		6,845		5,619
Revenue reserve		3		380		1,019
Total equity		47,036		49,407		62,747
Shareholder' funds
C Share	10	83.20p		84.87p		132.80p
D Share	10	58.60p		62.46p		113.54p
E Share	10	96.31p		101.69p		101.35p

T he statements were approved by the Directors and authorised for issue on 16 November 2020 and are signed on their behalf by:

David Frank

Chairman

16 November 2020

The accompanying notes are an integral part of this statement.

Unaudited Statement of Changes in Shareholders' Equity

For the Six months ended 30 September 2020

	Issued Capital	Share Redemption Reserve	Share Premium	Special Distributable Reserve	Capital Reserve	Revenue Reserve	Total
	£'000	£'000	£'000	£'000	£'000	£'000	£'000
Six months ended 30 September 2020
Opening balance	561	-	28,661	12,960	6,844	381	49,407
Issue of new shares	-	-	-	-	-	-	-
Purchase of own shares	(1)	1	-	-	-	(51)	(51)
Dividends paid	-	-	-	(2,105)	-	(932)	(3,037)
Transactions with owners	(1)	1	-	(2,105)	-	(983)	(3,088)
Profit for the year	-	-	-	-	112	605	717
Other comprehensive income	-	-	-	-	-	-	-
Profit and total comprehensive income for the year	-	-	-	-	112	605	717
Balance at 30 September 2020	560	1	28,661	10,855	6,956	3	47,036
Capital reserve consists of:
Investment holding gains					9,793
Other realised losses					(2,837)
					6,956
Year ended 31 March 2020
Opening balance	561	-	28,661	26,887	6,189	1,557	63,855
Dividends paid	-	-	-	(13,927)	-	(2,447)	(16,374)
Transactions with owners	-	-	-	(13,927)	-	(2,447)	(16,374)
Profit for the year	-		-	-	655	1,271	1,926
Profit and total comprehensive income for the year	-		-	-	655	1,271	1,926
Balance at 31 March 2020	561	-	28,661	12,960	6,844	381	49,407
Capital reserve consists of:
Investment holding gains					9,379
Other realised losses					(2,535)
					6,844
Six months ended 30 September 2019
Opening balance	561	-	28,661	26,887	6,189	1,557	63,855
Dividends paid	-	-	-	-	-	(1,357)	(1,357)
Transactions with owners	-	-	-	-	-	(1,357)	(1,357)
(Loss)/profit for the period	-	-	-	-	(570)	819	249
(Loss)/profit and total comprehensive income for the period	-	-	-	-	(570)	819	249
Balance at 30 September 2019	561	-	28,661	26,887	5,619	1,019	62,747
Capital reserve consists of:
Investment holding gains					7,855
Other realised losses					(2,236)
					5,619

The capital reserve represents the proportion of Investment Management fees charged against capital and realised/unrealised gains or losses on the disposal/revaluation of investments. The unrealised capital reserve, share redemption reserve and share premium reserve are not distributable. The special distributable reserve was created on court cancellation of the share premium account. The revenue, special distributable and realised capital reserves are distributable by way of dividend.

At 30 September the total reserves available for distribution were £8,021,000. This consisted of the distributable revenue reserve, net of the realised capital loss, plus the special distributable reserve.

Unaudited Statement of Cash Flows

For the Six months ended 30 September 2020

	Unaudited		Audited		Unaudited
Six months ended			Year ended		Six months ended
	30 September 2020		31 March 2020		30 September 2019
	£'000		£'000		£'000
Cash flows from operating activities
Profit before taxation	767		2,049		700
(Gain) arising on the disposal of investments during the period	204		181		(76)
(Gain) arising on the revaluation of investments at the period end	(414)		(1,076)		(65)
Cashflow generated by operations	557		1,154		559
(Increase)/decrease in receivables	(452)		465		(78)
Increase in payables	18		103		278
Cash flows from operating activities	123		1,722
Tax paid	-		(204)		(5)
Net cash flows from operating activities	123		1,518		754
Cash flow from investing activities
Purchase of financial assets at fair value through profit or loss	-		-		-
Proceeds of sale of financial assets at fair value through profit or loss	2,875		7,069		1,028
Net cash flows from investing activities	2,875		7,069		1,028
Cash flows from financing activities
Issue of new shares	-		-		28,950
Repayment of capital	(51)		-		-
Dividends paid	(3,037)		(16,374)		(4,100)
Proceeds from short-term debt	-		2,300		-
Net cash flows from financing activities	(3,088)		(14,074)		24,850
Net (decrease)/increase in cash and cash equivalents	(90)		(5,487)		26,632
Reconciliation of net cash flow to movements in cash and cash equivalents
Opening cash and cash equivalents	701		6,188		2,534
Net (decrease)/increase in cash and cash equivalents	(90)		(5,487)		26,632
Closing cash and cash equivalents	611		701		29,166

The accompanying notes are an integral part of this statement.

Unaudited Non-Statutory Analysis - The C Share Fund

For the Six months ended 30 September 2020

Statement of Comprehensive Income
		Six months ended				Year ended				Six months ended
		30 September 2020				31 March 2020				30 September 2019
		Revenue	Capital	Total		Revenue	Capital	Total		Revenue	Capital	Total
		£'000	£'000	£'000		£'000	£'000	£'000		£'000	£'000	£'000
Investment income		418	-	418		988	-	988		692	-	692
Unrealised gain on investments		-	-	-		-	218	218		-	-	-
Investment return		418	-	418		988	218	1,206		692	-	692
Investment management fees		(109)	(28)	(137)		(316)	(86)	(402)		(164)	(46)	(210)
Other expenses		(26)	-	(26)		(58)	-	(58)		(23)	-	(23)
Profit before taxation		283	(28)	255		614	132	746		505	(46)	459
Taxation		(12)	5	(7)		(53)	17	(36)		(33)	9	(24)
Profit after taxation		271	(23)	248		561	149	710		472	(37)	435
Profit and total comprehensive income for the period		271	(23)	248		561	149	710		472	(37)	435
Basic and diluted earnings/(loss) per share		2.00p	(0.17p)	1.83p		4.18p	1.11p	5.29p		3.50p	(0.28p)	3.22p
Balance Sheet		Six months ended					Year ended			Six months ended
		30 September 2020				31 March 2020				30 September 2019
				£'000				£'000				£'000
Non-current assets
Financial assets at fair value through profit or loss				11,342				11,502				17,380
Current assets
Receivables				202				66				160
Cash and cash equivalents				92				193				411
				294				259				571
Current liabilities
Payables				(108)				(17)				(11)
Corporation tax				(44)				(38)				(89)
Short-term debt facility				(300)				(300)				-
Net assets				11,184				11,406				17,851
Equity attributable to equity holders				11,184				11,406				17,851
Net asset value per share				83.20p				84.87p				132.80p
Statement of Changes in Shareholders' Equity		Six months ended					Year ended			Six months ended
		30 September 2020					31 March 2020			30 September 2019
				£'000				£'000				£'000
Opening shareholders funds				11,406				18,088				18,088
Profit for the period				248				710				435
Dividends paid				(470)				(7,392)				(672)
Closing shareholders' funds				11,184				11,406				17,851

Unaudited Non-Statutory Analysis - The C Share Fund

For the Six months ended 30 September 2020

Investment Portfolio	30 September 2020					31 March 2020
	Cost		Valuation			Cost		Valuation
	£'000	%	£'000	%		£'000	%	£'000	%
Unquoted qualifying holdings	7,409	97.83	11,270	98.56		7,417	94.69	11,279	96.44
Unquoted non-qualifying holdings	72	0.95	72	0.63		223	2.85	223	1.91
Financial assets at fair value through profit or loss	7,481	98.78	11,342	99.19		7,640	97.54	11,502	98.35
Cash and cash equivalents	92	1.22	92	0.81		193	2.46	193	1.65
	7,573	100.00	11,434	100.00		7,833	100.00	11,695	100.00
Qualifying Holdings
Unquoted
Hydro Electric Power
Green Highland Allt Choire A Bhalachain (255) Limited	2,466	32.56	2,965	25.93		2,466	31.48	2,965	25.35
Green Highland Allt Phocachain (1015) Limited	1,576	20.81	2,136	18.68		1,576	20.12	2,136	18.26
Achnacarry Hydro Ltd	3,367	44.46	6,169	53.95		3,375	43.09	6,178	52.83
	7,409	97.83	11,270	98.56		7,417	94.69	11,279	96.44
Non-Qualifying Holdings
Unquoted
Hydro Electric Power
Green Highland Allt Choire A Bhalachain (255) Limited	72	0.95	72	0.63		223	2.85	223	1.91
	72	0.95	72	0.63		223	2.85	223	1.91

Unaudited Non-Statutory Analysis - The D Share Fund

For the Six months ended 30 September 2020

Statement of Comprehensive Income
		Six months ended				Year ended				Six months ended
		30 September 2020				31 March 2020				30 September 2019
		Revenue	Capital	Total		Revenue	Capital	Total		Revenue	Capital	Total
		£'000	£'000	£'000		£'000	£'000	£'000		£'000	£'000	£'000
Investment income		345	-	345		780	-	780		411	-	411
Unrealised gain on investments		-	-	-		-	(277)	(277)		-	-	-
Investment return		345	-	345		780	(277)	503		411	-	411
Investment management fees		(119)	(21)	(140)		(286)	(79)	(365)		(145)	(40)	(185)
Other expenses		(23)	-	(23)		(52)	-	(52)		(23)	-	(23)
Profit/(loss) before taxation		203	(21)	182		442	(356)	86		243	(40)	203
Taxation		(39)	4	(35)		(83)	15	(68)		(46)	8	(38)
Profit after taxation		164	(17)	147		359	(341)	18		197	(32)	165
Profit and total comprehensive income for the period		164	(17)	147		359	(341)	18		197	(32)	165
Basic and diluted earnings/(loss) per share		1.21p	(0.12p)	1.09p		2.61p	(2.49p)	0.12p		1.44p	(0.24p)	1.20p
Balance Sheet		Six months ended				Year ended				Six months ended
		30 September 2020				31 March 2020				30 September 2019
				£'000				£'000				£'000
Non-current assets
Financial assets at fair value through profit or loss				10,036				10,146				12,018
Current assets
Receivables				88				378				801
Cash and cash equivalents				28				173				2,900
				116				551				3,701
Current liabilities
Payables				(78)				(69)				(8)
Corporation tax				(104)				(69)				(154)
Short-term debt facility				(2,000)				(2,000)				-
Net assets				7,970				8,559				15,557
Equity attributable to equity holders				7,970				8,559				15,557
Net asset value per share				58.60p				62.46p				113.54p
Statement of Changes in		Six months ended					Year ended			Six months ended
Shareholders' equity		30 September 2020					31 March 2020			30 September 2019
				£'000				£'000				£'000
Opening shareholders funds				8,559				16,077				16,077
Purchase of own shares				(51)				-				-
Profit for the period				147				18				165
Dividends paid				(685)				(7,536)				(685)
Closing shareholders' funds				7,970				8,559				15,557

Unaudited Non-Statutory Analysis - The D Share Fund

For the Six months ended 30 September 2020

Investment Portfolio	30 September 2020					31 March 2020
	Cost		Valuation			Cost		Valuation
	£'000	%	£'000	%		£'000	%	£'000	%
Unquoted qualifying holdings	8,247	99.66	10,036	99.73		8,248	96.69	10,036	97.25
Unquoted non-qualifying holdings	-	-	-	-		109	1.28	110	1.07
Financial assets at fair value through profit or loss	8,247	99.66	10,036	99.73		8,357	97.97	10,146	98.32
Cash and cash equivalents	28	0.34	28	0.27		173	2.03	173	1.68
	8,275	100.00	10,064	100.00		8,530	100.00	10,319	100.00
Qualifying Holdings
Unquoted
Hydro Electric Power
Elementary Energy	337	4.07	380	3.78		337	3.95	380	3.68
Green Highland Allt Ladaidh (1148) Limited	3,374	40.77	4,622	45.93		3,374	39.55	4,622	44.79
Green Highland Allt Luaidhe (228) Limited	1,918	23.18	2,341	23.26		1,918	22.49	2,341	22.69
Green Highland Allt Phocachain (1015) Limited	1,857	22.44	2,191	21.77		1,858	21.78	2,191	21.23
Green Highland Shenval Limited	761	9.20	502	4.99		761	8.92	502	4.86
	8,247	99.66	10,036	99.73		8,248	96.69	10,036	97.25
Non-Qualifying Holdings
Unquoted
Hydro Electric Power
Green Highland Allt Luaidhe (228) Limited	-	-	-	-		109	1.28	110	1.07
	-	-	-	-		109	1.28	110	1.07

Non-Statutory Analysis - The E Share Fund

For the Six months ended 30 September 2020

Statement of Comprehensive Income
		Six months ended				Year ended				Six months ended
		30 September 2020				31 March 2020				30 September 2019
		Revenue	Capital	Total		Revenue	Capital	Total		Revenue	Capital	Total
		£'000	£'000	£'000		£'000	£'000	£'000		£'000	£'000	£'000
Investment income		522	-	522		975	-	975		460	-	460
Realised gain on investments		-	(204)	(204)		-	(181)	(181)		-	-	-
Unrealised loss on investments		-	414	414		-	1,135	1,135		-	(448)	(448)
Investment return		522	210	732		975	954	1,929		460	(448)	12
Investment management fees		(258)	(72)	(330)		(485)	(132)	(617)		(240)	(65)	(305)
Other expenses		(72)	-	(72)		(95)	-	(95)		(40)	-	(40)
Profit/(loss) before taxation		192	138	330		395	822	1,217		180	(513)	(333)
Taxation		(22)	14	(8)		(44)	25	(19)		(30)	12	(18)
Profit/(loss) after taxation		170	152	322		351	847	1,198		150	(501)	(351)
Profit/(loss) and total comprehensive income for the period		170	152	322		351	847	1,198		150	(501)	(351)
Basic and diluted earnings/(loss) per share		0.59p	0.52p	1.11p		1.21p	2.92p	4.13p		0.52p	(1.73p)	(1.21p)
Balance Sheet		Six months ended				Year ended				Six months ended
		30 September 2020				31 March 2020				30 September 2019
				£'000				£'000				£'000
Non-current assets
Financial assets at fair value through profit or loss				26,718				29,115				24,315
Current assets
Receivables				949				341				196
Cash and cash equivalents				491				335				4,840
				1,440				676				5,036
Current liabilities
Payables				(262)				(344)				-
Corporation tax				(14)				(5)				(11)
Net assets				27,882				29,442				29,340
Equity attributable to equity holders				27,882				29,442				29,340
Net asset value per share				96.31p				101.69p				101.35p
Statement of Changes in Shareholders' equity		Six months ended					Year ended			Six months ended
		30 September 2020					31 March 2020			30 September 2019
				£'000				£'000				£'000
Opening shareholders funds				29,442				29,691				29,691
Profit for the period				322				1,198				(351)
Dividends paid				(1,882)				(1,447)				-
Closing shareholders' funds				27,882				29,442				29,340

Non-Statutory Analysis - The E Share Fund

For the Six months ended 30 September 2020

Investment Portfolio	30 September 2020					31 March 2020
	Cost		Valuation			Cost		Valuation
	£'000	%	£'000	%		£'000	%	£'000	%
Unquoted qualifying holdings	15,310	66.39	19,827	72.86		15,315	59.55	19,829	67.34
Quoted non-qualifying holdings	570	2.47	591	2.17		3,319	12.90	2,927	9.94
Unquoted non-qualifying holdings	6,688	29.02	6,300	23.15		6,750	26.25	6,359	21.60
Financial assets at fair value through profit or loss	22,568	97.88	26,718	98.18		25,384	98.70	29,115	98.88
Cash and cash equivalents	491	2.12	491	1.82		335	1.30	335	1.12
	23,059	100.00	27,209	100.00		25,719	100.00	29,450	100.00
Qualifying Holdings
Unquoted
Solar
Digima Limited	1,262	5.47	1,661	6.10		1,262	4.91	1,661	5.64
Digital Screen Solutions Limited	2,020	8.76	2,586	9.50		2,020	7.85	2,586	8.78
Green Energy for Education Limited	475	2.06	1,260	4.63		475	1.85	1,260	4.28
Hydro Electric Power
Elementary Energy Limited	1,723	7.47	2,081	7.65		1,723	6.70	2,081	7.07
Green Highland Shenval Limited	359	1.56	237	0.87		359	1.40	237	0.80
Green Highland Allt Choire A Bhalachain (255) Limited	664	2.88	798	2.93		664	2.58	798	2.71
Green Highland Allt Ladaidh (1148) Limited	126	0.55	149	0.55		126	0.49	149	0.51
Green Highland Allt Luaidhe (228) Limited	77	0.33	84	0.31		77	0.30	84	0.29
Green Highland Allt Phocachain (1015) Limited	498	2.16	662	2.43		498	1.94	662	2.25
Achnacarry Hydro Ltd	906	3.93	1,661	6.10		911	3.54	1,663	5.65
Gas Power
Green Peak Generation Limited	2,200	9.54	2,366	8.70		2,200	8.55	2,366	8.03
Vertical Growing
Perfectly Fresh Cheshire Limited	5,000	21.68	6,282	23.09		5,000	19.44	6,282	21.33
	15,310	66.39	19,827	72.86		15,315	59.55	19,829	67.34
Non-Qualifying Holdings
Quoted
Investment Property
Triple Point Social Housing REIT Plc - Equity	570	2.47	591	2.17		3,319	12.90	2,927	9.94
	570	2.47	591	2.17		3,319	12.90	2,927	9.94
Unquoted
Crematorium Management
Furnace Managed Services Limited	486	2.11	98	0.36		486	1.89	97	0.33
Hydro Electric Power
Elementary Energy Limited	140	0.61	140	0.51		200	0.78	199	0.68
SME Funding
Hydroelectric Power:
Broadpoint 2 Limited	1,334	5.79	1,334	4.90		1,335	5.19	1,334	4.53
Other:
Funding Path Limited	2,200	9.54	2,200	8.09		2,200	8.55	2,200	7.47
Aeris Power Limited	518	2.25	518	1.90		519	2.02	519	1.76
Broadpoint 3 Limited	2,010	8.72	2,010	7.39		2,010	7.82	2,010	6.83
	6,688	29.02	6,300	23.15		6,750	26.25	6,359	21.60

Condensed Notes to the Unaudited Interim Financial Statements

For the six months ended 30 September 2020

1.   Corporate information 

The Interim Report of the Company for the six months ended 30 September 2020 was authorised for issue in accordance with a resolution of the Directors on 16 November 2020.

The Company is listed on the London Stock Exchange.

Triple Point Income VCT plc is incorporated and domiciled in Great Britain. The address of the Company's registered office, which is also its principal place of business, is 1 King William Street, London, EC4N 7AF.

The Company is required to nominate a functional currency, being the currency in which the Company predominately operates. The functional and reporting currency is pounds sterling (£), reflecting the primary economic environment in which the Company operates.

The principal activity of the Company is investment. The Company's investment strategy is to offer combined exposure to cash or cash-based funds and venture capital investments focused on companies with contractual revenues from financially secure counterparties.

The financial information set out in this report does not constitute statutory accounts as defined in S434 of the Companies Act 2006.

2.   Basis of preparation and accounting policies   

Basis of preparation

The Interim Report of the Company for the six months ended 30 September 2020 has been prepared in accordance with IAS 34: Interim Financial Reporting. The same accounting policies and methods of computation are followed in the Interim Financial Report as were followed in the most recent Annual Report. It does not include all of the information required for full Financial Statements and should be read in conjunction with the Financial Statements for the year ended 31 March 2020.

Estimates

The preparation of the Interim Report requires the Board to make judgements, estimates and assumptions that reflect the application of accounting policies and the reported amounts of assets and liabilities, income and expenditure. However, actual results may differ from these estimates.

3.   Segmental reporting

The Directors are of the opinion that the Company only has a single operating segment of business, being investment activity. 

All revenues and assets are generated and held in the UK. 

4.  Investment income

	C Shares	D Shares	E Shares		Total
Unaudited	£'000	£'000	£'000		£'000
Six months ended 30 September 2020
Loan stock interest	198	345	427		970
Dividends receivable	220	-	79		299
Other Investment Income	-	-	15		15
Property Income	-	-	1		1
	418	345	522		1,285
Audited
Year ended 31 March 2020
Loan stock interest	655	771	637		2,063
Dividends receivable	331	-	40		371
Interest receivable on bank balances	2	9	35		46
Other Investment Income	-	-	63		63
Property Income	-	-	200		200
	988	780	975		2,743

5.  Investment management fees

TPIM provides investment management and administration services to the Company under an Investment Management Agreement effective 6 February 2008 and deeds of variation to that agreement effective 21 November 2012, 28 October 2014, 7 October 2016 and an amended and restated investment management and administration agreement dated 27 April 2020.

C shares: The agreement provides for an administration and investment management fee of 2% per annum of net assets payable quarterly in arrear for an appointment of at least six years from the admission of those shares. Subject to distributions to the C Shareholders exceeding the C Share hurdle, the Investment Manager will be entitled to a performance incentive fee of 20%.

D shares: The agreement provides for an administration and investment management fee of 2% per annum of net assets payable quarterly in arrear for an appointment of at least six years from the admission of those shares. Subject to distributions to the D Shareholders exceeding the D Share hurdle, the Investment Manager will be entitled to a performance incentive fee of 20%.

E shares: The agreement provides for an administration and investment management fee of 2% per annum of net assets payable quarterly in arrear for an appointment of at least six years from the admission of those shares. Subject to distributions to the E Shareholders exceeding the E Share hurdle, the Investment Manager will be entitled to a performance incentive fee of 20%.

There have been no performance fees paid to date

An administration fee equal to 0.25% per annum of the Company's net assets is payable quarterly in arrear.

6.  Directors' remuneration

	C Shares	D Shares	E Shares		Total
Unaudited	£'000	£'000	£'000		£'000
Six months ended 30 September 2020
David Frank	3	2	7		12
Simon Acland	3	2	6		11
Michael Stanes	2	2	7		11
	8	6	20		34
Audited
Year ended 31 March 2020
David Frank	5	5	10		20
Simon Acland	5	5	8		18
Michael Stanes	5	4	8		17
	15	14	26		55

The only remuneration received by the Directors was their Directors' fees. The Company has no employees other than the Non-Executive Directors. The number of Non-Executive Directors in the period was three.

7.  Taxation

	C Shares	D Shares	E Shares		Total
Unaudited	£'000	£'000	£'000		£'000
Six months ended 30 September 2020
Profit on ordinary activities before tax	255	182	330		767
Corporation tax @ 19%	48	35	63		146
Effect of:
Capital (gains) not taxable	-	-	(40)		(40)
Income received not taxable	(42)	-	(15)		(57)
Unrelieved tax losses arising in the year	1	-	-		1
Prior year adjustment	-	-	-		-
Tax charge	7	35	8		50
Audited
Year ended 31 March 2020
Profit on ordinary activities before tax	746	86	1,217		2,049
Corporation tax @ 20%	142	15	231		388
Effect of:
Capital (gains)/losses not taxable	(41)	53	(181)		(169)
Income received not taxable	(63)	-	(8)		(71)
Unrelieved tax losses arising in the year	(2)	-	-		(2)
Prior year adjustment	-	-	(23)		(23)
Tax charge	36	68	19		123

 Capital gains and losses are exempt from corporation tax due to the Company's status as a Venture Capital Trust.

8.  Earnings per share

The earnings per share for C Shares is based on the profit after tax of c.£246,000, and on the weighted average number of shares in issue during the period of 13,441,438, which is equal to the number of shares at 30 September 2020.

The earnings per share for D Shares is based on the profit after tax of c.£149,000, and on the weighted average number of shares in issue during the period of 13,668,773, which is equal to the number of shares at 30 September 2020.

The earnings per share for E Shares is based on the loss after tax of c.£323,000, and on the weighted average number of shares in issue during the period of 28,949,575, which is equal to the number of shares at 30 September 2020.

9.  Cash and cash equivalents

Cash and cash equivalents comprise deposits with The Royal Bank of Scotland plc.

10.   Net asset value per share

The calculation of the Company's net asset value per share for C Shares is based on the Company's net assets attributable to the C Shares of c.£11,184,000 divided by the 13,441,438 C Shares in issue.

The calculation of the Company's net asset value per share for D Shares is based on the Company's net assets attributable to the D Shares of c.£7,970,000 divided by the 13,701,636 D Shares in issue.

The calculation of the Company's net asset value per share for E Shares is based on the Company's net assets attributable to the E Shares of £27,882,000 divided by the 28,949,575 E Shares in issue.

11.    Commitments and contingencies   

The Company had no commitments or contingent liabilities at 30 September 2020.

12.    Relationship with Investment Manager  

During the period, TPIM charged £481,631 (which has been expensed by the Company) for providing management services to the Company.

Fees paid to the Investment Manager for administrative and Company Secretarial services during the period were £72,000.

At 30 September 2020 £393,645 was due to TPIM.

13.    Related party transactions  

There are no related party transactions.

14.    Dividends

C Shares:

The Company paid a dividend to C Class Shareholders of £470,450, equal to 3.5 pence per share, on 30 June 2020.

D Shares:

The Company paid a dividend to D Class Shareholders of £685,082, equal to 5 pence per share, on 30 June 2020.

E Shares:

The Company paid a dividend to E Class Shareholders of £1,881,722, equal to 6.5 pence per share, on 30 June 2020.

 

END

 

 

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