Proven VCT plc : Final Results

Proven VCT plc : Final Results

ProVen VCT plc
Final Results for the year ended 29 February 2012

Financial summary

Ordinary Shares

'C' Shares

'D' Shares

As at 29 February

2012

pence

2011

pence

2012

pence

2011

pence

2012

pence

2011

pence

Net asset value per share49.461.087.476.886.490.0
Dividends paid since launch114.0101.54.84.8--
Total return
(net asset value plus dividends paid since launch)		163.4162.592.281.686.490.0
Year on year change in:
Net asset value per share (adjusted for dividends)1.5%13.0%-4.0%
FTSE All Share Index total return1.5%1.5%1.5%

Chairman's Statement
I am pleased to present the Annual Report for ProVen VCT plc for the year ended 29 February 2012.  

The year saw a continuation of the difficult economic conditions, with renewed fears of a Eurozone crisis fuelling more volatility in stock market prices and hindering a recovery in investor confidence.  Although some of the Company's portfolio companies have been impacted by this climate, a number of the stronger portfolio companies have been able to make headway, such that the more mature share pools have seen an increase in Total Return (i.e. NAV plus dividends paid) over the year (after adjusting for dividends paid).

Net asset value
Ordinary Shares
At 29 February 2012, the Company's Ordinary Share net asset value ("NAV") stood at 49.4p per share. This represents an increase of 0.9p or 1.5% since 28 February 2011 after adjusting for the dividends of 12.5p which were paid during the year. The total return (NAV plus dividends paid to date) to Ordinary Shareholders that invested at the Company's launch now stands at 163.4p per Ordinary Share, equivalent to an IRR of 8.8% per annum.

'C' Shares
The NAV of the Company's 'C' Shares stood at 87.4p at 29 February 2012, an increase of 10.6p or 13.0% since 28 February 2011. The total return (NAV plus dividends paid to date) to 'C' Shareholders that invested at the launch of the 'C' Share pool now stands at 92.2p per share. No dividends were paid to 'C' Shareholders during the year.

'D' Shares
The NAV of the Company's 'D' Shares stood at 86.4p at 29 February 2012, a decrease of 3.6p or 4.0% since 28 February 2011. No dividends have been paid to 'D' Shareholders to date. The fall in NAV is partly a function of the fact that the 'D' Share pool is still in the process of being invested and uninvested cash does not provide sufficient income to cover running costs.

Portfolio activity and valuation
Ordinary Share pool
The Ordinary Share pool is effectively fully invested and, accordingly, had limited investment activity during the year. The pool disposed of one investment, AIM-quoted, Coolabi plc, which was the subject of a venture capital-backed MBO.

The Board reviewed the valuations of the unquoted investments at the year-end which produced a net unrealised gain for the year of £889,000.  

'C' Share pool
The 'C' Share pool made three new and five follow on investments during the year at a total cost of £2.5 million. The pool also exited from two investments, including Steak Media, which has generated a profit to date of £321,000 against cost with potential for further proceeds dependent on performance.

As with the Ordinary Share pool, the Board similarly reviewed the valuations of the unquoted investments in the 'C' Share portfolio at the year end. The net unrealised gain was £1,282,000 for the year, as a result of strong performance by a number of investee companies.

'D' Share pool
The 'D' Share pool made two new and two follow on investments during the year at a total cost of £530,000.  

As with the other share pools, the Board has reviewed the unquoted valuations at the year end and made some adjustments to the carrying values. This has resulted in a small net unrealised loss of £147,000.

Further details on investments in all pools are provided in the Investment Manager's Review and the Review of Investments.

Results and dividends
The total return on ordinary activities for the year was as follows:

RevenueCapitalTotal
£'000£'000£'000
Ordinary Shares21873291
'C' Shares2031,3201,523
'D' Shares(42)(257)(299)
3791,1361,515

The Board is not proposing to pay any further interim or final dividends in respect of any share class for the year ended 29 February 2012. Two interim dividends were paid to Ordinary Shareholders during the year, totalling 12.5p per share.

'C' Shares - tender offer and conversion to Ordinary Shares
In the prospectus published in November 2006 in connection with the offers for subscription for the 'C' Shares, the intention was set out that, within approximately 5 1/2 years of the close of the offers, the Company would launch a tender offer to buy in 'C' Shares at a price equivalent to the latest published NAV. The terms of the tender offer were to return at least 20p per £1 invested such that the investors had received a minimum overall cash return to date of 25p per £1 invested. The Company has paid tax free dividends to date of 4.75p per 'C' Share and the tender offer will therefore return 20.25p per 'C' Share to those Shareholders who wish to participate. The tender offer is conditional upon resolution 10 being passed at the forthcoming AGM and resolution 4 at the Class Meetings, which will also be required. The Company will also be publishing a circular shortly relating to the tender offer which will be sent to Shareholders along with the Annual Report.

The 'C' Share prospectus also set out plans that, following the tender offer, the 'C' Shares would convert into Ordinary Shares. Arrangements have now been put in place for this conversion to take place in October 2012, based on the relative NAVs of the Ordinary Shares and 'C' Shares as at 31 August 2012. The Board is proposing that the formula for conversion currently in the Company's Articles of Association is simplified to ensure it produces the intended result. Resolution 12 will be proposed at the AGM and resolution 6 at the Class Meetings to this end.

'D' Shares - conversion to Ordinary Shares
In considering the planned conversion of 'C' Shares into Ordinary Shares, the Board has also reviewed plans for the 'D' Share class. The Board believes that also converting the 'D' Shares into Ordinary Shares gives all Shareholders exposure to a broader range of investments and reduces the potential impact of underperformance of any one investment. It also brings some significant benefits to the Company in simplifying management of the investments, reporting to Shareholders and administration. In view of these benefits, the Board will put proposals to all Shareholders to convert 'D' Shares into Ordinary Shares at the same time as the 'C' Share conversion noted above. It is proposed that the 'D' Shares will be converted based on the relative NAVs of the Ordinary Shares and 'D' Shares as at 31 August 2012.

Ordinary Shares - share consolidation
The substantial dividends paid to date on the Ordinary Shares (113.95p in total) have resulted in a reduction in the Ordinary Share NAV to around 50p, despite the total return to Shareholders who invested at launch being 163.35p per share. Given the proposed merger of the 'C' and 'D' Share classes, the Board has decided to rebase the NAV of the Ordinary Shares to around £1 and is proposing to undertake a share consolidation to take place immediately before the conversion of the 'C' Shares and 'D' Shares in order to achieve this.

A resolution in respect of the share consolidation will be put to Shareholders at the forthcoming AGM and Class Meetings, together with a resolution amending the Company's articles of association so that the conversion of the 'C' Shares takes into account the consolidation of the Ordinary Shares.

If the various proposals above are approved, the Company will have one share class (New Ordinary Shares) going forward with an NAV close to £1 per share.

Share buybacks
In order to ensure liquidity in the market in the Company's shares, the Company has operated a policy of buying in its own shares that become available in the market. During the year, the Company made market purchases of 995,887 Ordinary Shares for cancellation at an average price of 48.4p per share, 100,719 'C' Shares for cancellation at an average price of 70.4p per share and 20,510 'D' Shares for cancellation at an average price of 85.1p per share.

The Board intends to continue to make purchases of its shares when they become available in the market and has a current policy of purchasing Ordinary Shares and 'C' Shares at a price equivalent to a 10% discount to the latest published NAV and at a 5% discount in respect of 'D' Shares in accordance with the policies set out in the relevant prospectuses. If the proposed conversion of 'C' and  'D' Shares into Ordinary Shares described above is approved, the Company will have only Ordinary Shares following the conversion.  The discount of 10% to NAV will then apply to all share buybacks.

A special resolution to allow the Board to continue to purchase shares for cancellation will be proposed at the forthcoming AGM and Class Meetings.

Shareholders who are considering selling their shares are reminded that they should consider contacting the Company's Administrator,  Downing LLP, prior to selling their shares.  Downing is able to provide details of close periods and of the prices at which the Company has bought in shares.

Dividend Policy
The subject on which I receive most correspondence is dividends.  In the survey conducted last year, the Board asked Shareholders whether they would prefer (i) profits on investment disposals to be distributed as they arise or for dividends to be smoothed, and (ii) distribution of the maximum amount each year, even if this reduces the NAV, or an amount which maintains or increases the NAV.  Of the Shareholders who responded, a majority of the Ordinary Shareholders, who are generally the Shareholders who have held their shares the longest, preferred the highest distributions. Among the 'C' and 'D' Shareholders, who have held shares a lesser time, opinion was more evenly split.  In general, the shorter the holding period has been, the greater the tendency towards smoothing dividends and maintaining or increasing the NAV.   Since the questionnaire there has been a further issue of Ordinary Shares, whose holders I expect to hold similar views to other more recent Shareholders.

In anticipation of the merger of the Ordinary, 'C' and 'D' Share classes proposed for later this year, the Board has decided to adopt a consistent dividend policy for all share classes.  With the diversity of opinion expressed in the survey, it is impossible to provide a distribution policy which will satisfy all individual preferences. The Board has therefore decided to set an objective of paying a distribution each year which will equate to a yield of approximately 5% of net asset value. The ability to achieve this objective will, however, depend on there being sufficient reserves available for distribution, which in turn will depend on the level and timing of profitable realisations. It therefore cannot be guaranteed. In the event of there being a realisation from the portfolio which results in an exceptionally large gain, the Board may decide to pay a special dividend which is significantly in excess of the target yield of 5%.

The Board believes that this objective is consistent with the NAV remaining broadly stable or increasing over time, although this will clearly depend on the returns from the Company's investments and cannot be guaranteed.

The Board reminds Shareholders who do not want dividends of the advantages of taking part in the dividend re-investment scheme. For those Shareholders who wish to sell their shares, the share buyback policy remains in place, dependent on there being sufficient liquidity.

Ordinary Share tender offer and fundraising
On 8 December 2011, the Company launched an Ordinary Share offer for subscription seeking to raise up to approximately £15 million. The Company also offered existing Ordinary Shareholders the opportunity to sell their shares back to the Company at a price approximately equal to NAV on the basis that they agreed to reinvest the proceeds in the new share offer. Shares in the new offer were issued to participating Shareholders at a premium of approximately 3.5% to NAV.

On 13 February 2012, 655,309 Ordinary Shares were purchased under the tender offer at a price of 47.7p per Ordinary Share. On 15 February 2012, 631,318 new Ordinary Shares were issued to the tender offer participants at an effective price of approximately 49.5p per Ordinary Share (after taking into account additional shares given to the participants).

The offer for subscription was extended on 17 May 2012 and will now close on 30 August 2012 (or earlier if fully subscribed). A total of 21.6 million Ordinary Shares have been issued to date under the offer at an average price of 50.5p per Ordinary Share, producing net proceeds of £10.7 million.

Annual General Meeting and Class Meetings
The Annual General Meeting ("AGM") of the Company will be held in The Forest Room at The Hospital Club, 24 Endell Street, Covent Garden, London WC2H 9HQ at 11:00 a.m. on 21 August 2012.  

Seven items of special business will be proposed at the AGM as follows:

  • two resolutions in connection with authority for the Directors to allot shares  

  • one resolution in respect of share buybacks, 

  • one resolution in connection with the 'C' Share tender offer, 

  • one resolution in connection with the Ordinary Share consolidation, 

  • two resolutions in connection with amendments to the Company's articles of association. 

Each of these items will result in changes to the issued share capital of the Company or will amend the Company's articles of association. The Company's articles of association are currently worded such that approval for the Company to either increase or decrease the issued share capital or amend the articles of association is required at a meeting of all Shareholders and also meetings of each separate share class ("Class Meetings"). Therefore the AGM will be followed by separate share class meetings to approve the seven resolutions detailed above as follows:

Share Class MeetingStart time
Ordinary Shares11:05 a.m.
'C' Shares11:10 a.m.
'D' Shares11:15 a.m.

The Company will also be publishing a Shareholder circular shortly, which will seek Shareholder approval for the 'D' Share conversion into Ordinary Shares as described above.  

Shareholder event
I would like to take this opportunity to draw your attention to the Investment Manager's annual Shareholder presentation which is expected to be held in central London later in the year. This event provides Shareholders with an opportunity to meet the Investment Manager and, additionally, to hear directly from some of the portfolio companies and to meet other VCT shareholders. Further details of the event will be communicated to Shareholders in due course.

Outlook
The coming months are expected to be busy with the Company implementing the proposals for the 'C' Share tender offer and, subject to the approval of Shareholders, the merging of all shares classes into one.  Once complete, all Shareholders will have a stake in a share class which holds a more diversified investment portfolio than previously and has a significant level of funds available for new investments.

With no clear prospects for improved economic conditions in sight and uncertainties created by regulators and legislators, new investment activities are expected to remain challenging. The Manager reports an attractive flow of potential investment opportunities, albeit at full prices, in sectors which have delivered good results for the Company in the past. I believe that we have a number of interesting investments that have the potential to show meaningful profits and that the Manager has the skill to deliver them.

Andrew Davison
Chairman

Investment Manager's Review

Introduction

Beringea is a specialist venture capital management company which manages £200 million in the UK and USA on behalf of a number of clients. In the UK, Beringea has a dedicated investment team managing over £90 million across four VCTs.

ProVen VCT has been managed by Beringea since its inception in 2000 and in that time has invested over £45 million in over 50 small and medium sized companies. At present, the Company has investments in 27 companies, with an average cost of approximately £800,000 per investment. ProVen VCT and other VCTs like it continue to make an important contribution to the development of UK business particularly at a time when traditional lenders are reluctant to advance credit. This support extends beyond purely financial support with our investment executives providing ongoing mentoring and strategic advice and introducing new directors who can both support individual businesses and drive them to the next level.

Review of the year
The Company invested £3.6 million during the year (2011: £4.6 million). There were three new investments and further funding was provided to seven existing companies. The Company realised its investments in three companies: Coolabi, Steak Media and Lazurite. The existing portfolio showed net unrealised gains of £2.0 million across the share classes including upwards revaluations from Think, Donatantonio and Blis Media (formerly Breeze Tech). Offsetting this were valuation reductions for a number of investments including those in Fjordnet, Senselogix and Overtis. It is worth pointing out that these reductions can reflect both the performance of the individual companies and/or the wider performance of comparable sectors/companies used in valuing the investments.

Ordinary Share pool - portfolio activity and valuation

At 29 February 2012, the Company's Ordinary Share pool held investments in 15 companies, of which 13 were unquoted and two quoted, at a valuation of £12.4 million and original acquisition cost of £10.7 million. In addition, the share pool had cash and liquidity funds of £4.6 million, including £3.2 million of cash from the current fundraising. Further funds raised since the end of the financial year have increased cash and liquidity fund resources to over £10 million.

No new companies were added to the Ordinary Share portfolio during the year but further investments were made in Think, Tossed and Overtis. The Company disposed of its holding in Coolabi plc when it delisted from AIM and became a private company.

Espresso Group continues to form a significant part of the Ordinary Share portfolio and continues to perform well as a provider of digital content to schools both in the UK and overseas. The company's strong cash flow generation in the UK has provided a firm base for expansion into overseas territories. Digital media agency, Think, has shown a large uplift in value following its selection as the lead agency for "Pottermore", the online reading experience created by J.K. Rowling and based around the Harry Potter books, and strong client wins from the likes of Sony, Formica and Warner Brothers. We took the opportunity to invest a further £800,000 from the Ordinary and 'C' Share pools to fund future growth.

'C' Share pool - portfolio activity and valuation

At 29 February 2012, the Company's 'C' Share pool comprised 20 companies, all of which were unquoted, at a valuation of £11.1 million and original acquisition cost of £8.8 million. In addition, the share pool had cash and liquidity funds of £2.4 million.

Two new investments were made from the 'C' Share pool: Cross Solar, a residential rooftop solar energy company, and Utility Exchange, which provides utility (electricity, gas and telecommunications) price comparison and contract switching for small businesses. The generation of renewable energy from solar installations which benefit from government backed feed-in tariffs has been well documented and Cross Solar is managed by one of the most experienced teams in this sector in the UK. Some of the funds for this investment came from another 'C' Share company, Lazurite, and it also received funding from other ProVen VCTs. Utility Exchange has a similarly experienced team with over 20 years' background in delivering business telecommunication services and 10 years' experience delivering business electricity and gas to all sizes of customers, from SMEs to large corporates.

Further investments were made in a number of companies including Think, Blis Media and Overtis Group.

We were pleased to conclude the disposal of Steak Media in May 2011, which we reported on in last year's annual report. The investment has to date returned 1.8 times the initial investment cost with the potential for further receipts dependent on future performance.

The strong performance of Think has given rise to an unrealised multiple of 2.7 times the initial investment cost. This is split equally between the Ordinary and 'C' Shares and, in the 'C' Share pool, is the largest qualifying investment by value. There was continued good performance from Donatantonio and Blis Media performed very strongly, resulting in upwards revaluations to both these companies.

'D' Share pool - portfolio activity and valuation

At 29 February 2012, the Company's 'D' Share pool comprised nine unquoted companies at a valuation of £2.0 million and original acquisition cost of £2.3 million. In addition, the share pool had cash and liquidity funds of £5.1 million.

New investments were made in Utility Exchange (described above) and APM Healthcare. Further follow-on funding was provided to Tossed and Senselogix. APM Healthcare is the holding company of Community Pharmacies (UK) Limited (CPL) which is aiming to become a prominent niche player in the prescription pharmacy sector in partnership with GP practices. Since our investment, CPL has opened five new pharmacies. Staffed by professional pharmacists, the business encourages operating freedom to allow each outlet to provide exactly what local customers need, with support and expert guidance from a centralised head office.

The 'D' Share pool is valued near cost although at the individual company level there has been strong performance from the jewellery brand Monica Vinader which has enabled an upwards revaluation. MatsSoft is the largest qualifying investment in the 'D' Share pool, representing 9% of total 'D' Share investments.

Post year end developments
In April 2012, the 'D' Share pool received shares in Long Eaton Healthcare Limited, a Midlands based GP-centre pharmacy, by virtue of its investment in APM Healthcare. Funding for this investment was provided by ProVen Planned Exit VCT plc which is also managed by Beringea. Further follow on funding was also provided directly to APM Healthcare and to Utility Exchange, both in line with the original investment proposal.

In June 2012 the Company took the opportunity to realise its investment in Ashford Colour Press with realisation proceeds exceeding the valuation at 29 February 2012.

Overtis Group went through a technical restructuring after the year end whereby it entered administration and its assets and intellectual property were acquired by a new entity called Vigilant Applications.  ProVen VCT rolled over £399,000 of its loan note investment in Overtis Group into the new entity. The investment in Overtis had been fully provided for at the year end and there is therefore no impact on the Company's net asset value.

Outlook
We continue to see an attractive flow of investment opportunities in a variety of sectors. Digital media continues to be an attractive area and one in which we have historically done well, with companies such as Mergermarket, Saffron Media and ILG Digital, and in which we think there are further good opportunities. Our experience and network of contacts in the sector makes us a natural choice for those digital media businesses seeking funding.  Despite the challenges facing many UK businesses, the portfolio continues to perform well overall. We are also confident that further good investment opportunities lie ahead.

Beringea LLP
Investment activity during the year is summarised as follows:

Additions
Cost
£'000
Ordinary Share pool
Think Limited400
Tossed Limited110
Overtis Group Limited100
610
'C' Share pool
Cross Solar PV Limited**1,016
Think Limited400
Blis Media Limited**291
Overtis Group Limited283
Campden Media Limited227
Senselogix Limited112
Tossed Limited80
Utility Exchange Online Limited64
2,473
'D' Share pool
Utility Exchange Online Limited234
APM Healthcare Limited187
Senselogix Limited69
Tossed Limited40
530
Total 3,613

Disposals
Cost
Market value
 at 01/03/11
Disposal
 proceeds
(Loss)/gain
against
cost
Total realised
 (loss)/gain
during the year
£'000
£000
£'000
£'000
£'000
Ordinary Share pool
Coolabi plc**3007274(226)2
3007274(226)2
'C' Share pool
Steak Media Limited**456531777321246
Lazurite Limited1,000968941(59)(27)
1,4561,4991,718262219
Total1,7561,5711,79236221

** Partially non qualifying investment  

All of the above investments, with the exclusion of Think Limited, were also held by ProVen Growth & Income VCT plc of which Beringea LLP is the investment manager.

APM Healthcare Limited was also held by Proven Health VCT plc of which Beringea LLP is the investment manager.

Cross Solar PV Limited and Campden Media Limited were also held by Proven Planned Exit VCT plc of which Beringea LLP is the investment manager.

Investment Portfolio - Ordinary Share Pool

as at 29 February 2012

Ordinary Share portfolio of investments

The following investments were held at 29 February 2012:

Cost
£'000
Valuation
£'000
Valuation
movement
in year
£'000
% of
portfolio
by value
Top ten venture capital investments (by value)
Espresso Group Limited1,3173,56723620.9%
Think Limited**8032,1951,05412.9%
SPC International Limited**1,6191,7549410.3%
Eagle Rock Entertainment Group Limited**1,0101,158(151)6.8%
Campden Media Limited1,2891,101(69)6.5%
Donatantonio Limited5829962685.8%
Tossed Limited578622443.6%
Ashford Colour Press Limited500382(51)2.2%
Pilat Media Global plc**173276(160)1.6%
Fjordnet Limited200235(111)1.4%
8,07112,2861,15472.0%
Other venture capital investments
2,633156(265)1.1%
Total venture capital investments
10,70412,44288973.1%
Liquidity funds9005.3%
Cash at bank and in hand3,68121.6%
Total Ordinary Share investments
17,023100.0%

Other venture capital investments at 29 February 2012 comprise: UBC Media Group plc, Sports Holdings Limited*,  Overtis Group Limited, Isango! Limited and Baby Innovations S.A. t/a Steribottle*.

*   Non qualifying investment    
** Partially non qualifying investment

With the exclusion of Pilat Media Global plc and UBC Media Group plc, which are quoted on AIM, all venture capital investments are unquoted.

All of the above investments, with the exclusion of Think Limited, were also held by ProVen Growth & Income VCT plc of which Beringea LLP is the investment manager.

Campden Media Limited was also held by Proven Planned Exit VCT plc of which Beringea LLP is the investment manager.

All venture capital investments are registered in England and Wales, with the exception of Baby Innovations S.A., which is registered in Madeira.

Investment Portfolio - 'C' Share Pool

as at 29 February 2012

'C' Share portfolio of investments

The following investments were held at 29 February 2012:

Cost
£'000
Valuation
£'000
Valuation
movement
in year
£'000
% of portfolio
by value
Top ten venture capital investments (by value)
Think Limited**8032,1951,05416.2%
Donatantonio Limited**8851,51540711.2%
Blis Media Limited4821,0685087.9%
Cross Solar PV Limited**1,0161,016-7.5%
Fjordnet Limited800940(444)7.0%
Charterhouse Leisure Limited700739615.5%
Chess Technologies Limited6007312765.4%
Monica Vinader Limited2245102863.8%
SPC International Limited403469(136)3.5%
Tossed Limited425457323.4%
6,3389,6402,04471.4%
Other venture capital investments
2,4971,450(762)10.7%
Total venture capital investments8,83511,0901,28282.1%
Liquidity funds4503.3%
Cash at bank and in hand1,96314.6%
Total 'C' Share investments13,503100.0%

Other venture capital investments at 29 February 2012 comprise Campden Media Limited, Speed-Trap Holdings Limited, Eagle Rock Entertainment Group Limited*, Overtis Group Limited, Cinergy International Limited, MatsSoft Limited**, Dianomi Limited, Utility Exchange Online Limited, Senselogix Limited, and Isango! Limited.

*   Non qualifying investment    
** Partially non-qualifying investment

All of the above investments, with the exclusion of Think Limited, were also held by ProVen Growth & Income VCT plc of which Beringea LLP is the investment manager.

Cross Solar PV Limited and Campden Media Limited were also held by Proven Planned Exit VCT plc of which Beringea LLP is the investment manager.

All venture capital investments are unquoted and are registered in England and Wales.

Investment Portfolio - 'D' Share Pool

as at 29 February 2012

'D' Share portfolio of investments

The following investments were held at 29 February 2012:

Cost
£'000
Valuation
£'000
Valuation
 Movement
 in year
£'000
% of
 portfolio
by value
Venture capital investments (by value)
MatsSoft Limited**650650-9.1%
Monica Vinader Limited1383151774.4%
Tossed Limited223240173.3%
Utility Exchange Online Limited234234-3.3%
APM Healthcare Limited188188-2.6%
Speed-Trap Holdings Limited300183(117)2.6%
Cinergy International Limited115112(2)1.6%
Fjordnet Limited*276102(84)1.4%
Senselogix Limited138-(138)0.0%
Total venture capital investments2,2622,024(147)28.3%
Liquidity funds4,85067.5%
Cash at bank and in hand2984.2%
Total 'D' Share investments7,172100.0%

*   Non qualifying investment    
** Partially non-qualifying investment

All of the above investments were also held by ProVen Growth & Income VCT plc of which Beringea LLP is the investment manager.

APM Healthcare Limited was also held by Proven Health VCT plc of which Beringea LLP is the investment manager.

All venture capital investments are unquoted and are registered in England and Wales.

Directors' responsibilities statement

The Directors are responsible for preparing financial statements in accordance with applicable law and regulations. They are also responsible for ensuring that the annual report includes information required by the Listing Rules of the Financial Services Authority.

Company law requires the Directors to prepare financial statements for each financial year.  Under that law the Directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law, the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

In preparing these financial statements, the Directors are required to:

  • select suitable accounting policies and then apply them consistently; 

  • make judgments and accounting estimates that are reasonable and prudent;  

  • state whether applicable UK accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and 

  • prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business. 

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions, to disclose with reasonable accuracy at any time the financial position of the Company and to enable them to ensure that the financial statements comply with the requirements of the Companies Act 2006.  They are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.  

The Directors are responsible for the maintenance and integrity of the corporate and financial information relating to the Company included on the Managers' websites. Legislation in the United Kingdom governing the preparation and dissemination of the financial statements and other information included in annual reports may differ from legislation in other jurisdictions.

Statement as to disclosure of information to the Auditor

The Directors in office at the date of the report have confirmed, as far as they are aware, that there is no relevant audit information of which the Auditor is unaware. Each of the Directors has confirmed that they have taken all the steps that they ought to have taken as Directors in order to make themselves aware of any relevant audit information and to establish that it has been communicated to the Auditor. This confirmation is given and should be interpreted in accordance with the provisions of section 418 of the Companies Act 2006.

By order of the Board

Grant Whitehouse
Secretary

Balance Sheet

as at 29 February 2012

29 February 2012
28 February 2011
Ordinary
Shares
'C'
Shares
'D'
Shares
Total
Ordinary
Shares
'C'
Shares
'D'
Shares
Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
Fixed assets

Investments

12,44211,0902,02425,55611,0168,8331,64121,490
Current assets

Debtors

981232124216010919288

Current investments

9004504,8506,2003,4001,3504,4509,200

Cash at bank and in hand

3,6811,9632985,9421,4649501,4003,814
4,6792,5365,16912,3845,0242,4095,86913,302

Creditors: amounts falling due within one year

(410)(1,032)(64)(1,506)(662)(100)(64)(826)
Net current assets
4,2691,5045,10510,8784,3622,3095,80512,476
Total assets less current liabilities/
Net assets
16,71112,5947,12936,43415,37811,1427,44633,966
Capital and reserves

Called up share capital

1,3673,604825,0531,2603,629834,972

Capital redemption reserve

261511313211261238

Share premium

2,628-7,78510,4131,026-7,7858,811

Share capital to be issued

3,206--3,206

Special reserve

6,1465,617-11,7638,2476,666-14,913

Capital reserve - realised

1,6751,059(292)2,4423,700-(182)3,518

Revaluation reserve

1,7382,255(237)3,7566221,016(90)1,548

Revenue reserve

(310)8(210)(512)312(195)(151)(34)
Equity shareholders' funds
16,71112,5947,12936,43415,37811,1427,44633,966
Basic and diluted net asset value per share
49.4p87.4p86.4p61.0p76.8p90.0p

Reconciliation of Movements in Shareholders' Funds

for the year ended 29 February 2012

Year ended 29 February 2012
Year ended 28 February 2011
Ordinary
Shares
'C'
Shares
'D'
Shares
Total
Ordinary
Shares
'C'
Shares
'D'
Shares
Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
Opening shareholders' funds15,37811,1427,44633,96612,92910,9965,09729,022
Issue of shares1,860--1,8601,199-2,8003,999
Share issue costs(101)--(101)(66)-(154)(220)
Purchase of own shares(483)(71)(18)(572)(249)(38)(51)(338)
Share capital to be issued3,2063,206
Total recognised gains/(losses) for the year2911,523(299)1,5153,601184(246)3,539
Distributions (3,440)--(3,440)(2,036)--(2,036)
Closing shareholders' funds16,71112,5947,12936,43415,37811,1427,44633,966

Income Statement

for the year ended 29 February 2012

Company

Year ended 29 February 2012
Year ended 28 February 2011
Revenue
Capital
Total
Revenue
Capital
Total
£'000
£'000
£'000
£'000
£'000
£'000
Income844-844831-831
Gains on investments -2,2452,245-3,9613,961
8442,2453,0898313,9614,792
Investment management fees(177)(527)(704)(160)(480)(640)
Performance incentive fees-(582)(582)-(360)(360)
Other expenses(288)-(288)(253)-(253)
Return on ordinary activities before tax3791,1361,5154183,1213,539
Tax on ordinary activities------
Return attributable to equity shareholders3791,1361,5154183,1213,539
Basic and diluted return per share:
Ordinary Share
0.8p
0.3p
1.1p
1.8p
12.4p
14.2p
 'C' Share
1.4p
9.1p
10.5p
(0.0p)
1.3p
1.3p
 'D' Share
(0.5p)
(3.1p)
(3.6p)
(0.5p)
(2.6p)
(3.1p)

All revenue and capital movements in the year for the Ordinary Shares, 'C' Shares and 'D' Shares relate to continuing operations. No operations were acquired or discontinued during the year.  The total column within the Income Statement represents the profit and loss account of the Company, prepared in accordance with the accounting policies detailed in note 1. The supplementary revenue and capital columns are presented for information purposes in accordance with the Statement of Recommended Practice issued by The Association of Investment Companies.

A Statement of Total Recognised Gains and Losses relating to each class of share has not been prepared as all gains and losses are recognised in the relevant Income Statements in the current and prior year.

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

Income Statement

for the year ended 29 February 2012

Split as: Ordinary Shares

Year ended 29 February 2012
Year ended 28 February 2011
Revenue
Capital
Total
Revenue
Capital
Total
£'000
£'000
£'000
£'000
£'000
£'000
Income418
-
418
626
-
626
Gains on investments-
891
891
-
3,709
3,709
418
891
1,309
626
3,709
4,335
Investment management fees(79)(236)(315)(70)
(208)
(278)
Performance incentive fees-(582)(582)-
(360)
(360)
Other expenses(121)-(121)(96)
-
(96)
Return on ordinary activities before tax218
73
291
460
3,141
3,601
Tax on ordinary activities-
-
-
-
-
-
Return attributable to equity shareholders218
73
291
460
3,141
3,601

'C' Shares

Year ended 29 February 2012
Year ended 28 February 2011
Revenue
Capital
Total
Revenue
Capital
Total
£'000
£'000
£'000
£'000
£'000
£'000
Income368-368153-153
Gains on investments-1,5011,501-342342
3681,5011,869153342495
Investment management fees(61)(181)(242)(53)(159)(212)
Performance incentive fees------
Other expenses(104)-(104)(99)-(99)
Return on ordinary activities before tax2031,3201,5231183184
Tax on ordinary activities------
Return attributable to equity shareholders2031,3201,5231183184

'D' Shares

Year ended 29 February 2012
Year ended 28 February 2011
Revenue
Capital
Total
Revenue
Capital
Total
£'000
£'000
£'000
£'000
£'000
£'000
Income58-5852-52
Losses on investments-(147)(147)-(90)(90)
58(147)(89)52(90)(38)
Investment management fees(37)(110)(147)(37)(113)(150)
Performance incentive fees------
Other expenses(63)-(63)(58)-(58)
Loss on ordinary activities before tax(42)(257)(299)(43)(203)(246)
Tax on ordinary activities------
Loss attributable to equity shareholders(42)(257)(299)(43)(203)(246)

Cash Flow Statement

for the year ended 29 February 2012

Year ended 29 February 2012
Year ended 28 February 2011
Ordinary
Shares
'C'
Shares
'D'
Shares
Total
Ordinary
Shares
'C'
Shares
'D'
Shares
Total
£'000
£'000
£'000
£'000
£'000
£'000
£'000
£'000
Net cash (outflow)/ inflow from operating activities(790)30(154)(914)(582)(264)(1,197)(2,043)
Capital expenditure
Purchase of investments(610)(2,473)(530)(3,613)(984)(1,885)(1,731)(4,600)
Sale of investments741,718-1,7923,220508-3,728
Net cash (outflow)/ inflow from capital expenditure(536)(755)(530)(1,821)2,236(1,377)(1,731)(872)
Equity dividends paid
(3,440)--(3,440)(2,036)--(2,036)

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