TIDMAATG
Albion Technology & General VCT PLC
LEI number: 213800TKJUY376H3KN16
As required by the UK Listing Authority's Disclosure Guidance and
Transparency Rules 4.1 and 6.3, Albion Technology & General VCT PLC
today makes public its information relating to the Annual Report and
Financial Statements for the year ended 31 December 2020.
This announcement was approved for release by the Board of Directors on
26 March 2021.
This announcement has not been audited.
The Annual Report and Financial Statements for the year ended 31
December 2020 (which have been audited), will shortly be sent to
shareholders. Copies of the full Annual Report and Financial Statements
will be shown via the Albion Capital Group LLP website by clicking
https://www.globenewswire.com/Tracker?data=PVnDoECJEFxyrV2mKasD0zjDbT_f4aKewzt2Ro_oSQSW3Ijbq3rZYPjbf9jo7HPoSyksHtNipSv9UsAxqdJIDOrw9h0rl3zX3pFqhFqA6mFmbHPiegpUeIHfZ8zLaXq-avRw6TKlUwe5Cd_17qBgxl0oLH9GBgKlSUM6K7wpc0w=
www.albion.capital/funds/AATG/31Dec20.pdf. The information contained in
the Annual Report and Financial Statements will include information as
required by the Disclosure Guidance and Transparency Rules, including
Rule 4.1.
Investment objective and policy
The Company's investment objective is to provide investors with a
regular and predictable source of dividend income, combined with the
prospect of long-term capital growth, through a balanced portfolio of
predominantly unquoted growth and technology businesses in a qualifying
Venture Capital Trust ("VCT").
Investment policy
The Company will invest in a broad portfolio of unquoted growth and
technology businesses. Allocation of assets will be determined by the
investment opportunities which become available, but efforts will be
made to ensure that the portfolio is diversified in terms of sectors and
stages of maturity of portfolio companies.
VCT qualifying and non-qualifying investments
Application of the investment policy is designed to ensure that the
Company continues to qualify and is approved as a VCT by HM Revenue and
Customs ("VCT regulations"). The maximum amount invested in any one
company is limited to any HMRC annual investment limits. It is intended
that normally at least 80 per cent. of the Company's funds will be
invested in VCT qualifying investments. The VCT regulations also have an
impact on the type of investments and qualifying sectors in which the
Company can make an investment.
Funds held either prior to investing in VCT qualifying assets or for
liquidity purposes will be held as cash on deposit, invested in floating
rate notes or similar instruments with banks or other financial
institutions with high credit ratings or invested in liquid open-ended
equity funds providing income and capital equity exposure (where it is
considered economic to do so). Investment in such open-ended equity
funds will not exceed 7.5 per cent. of the Company's assets at the time
of investment.
Risk diversification and maximum exposures
Risk is spread by investing in a number of different businesses within
VCT qualifying industry sectors using a mixture of securities. The
maximum the Company will invest in a single company is 15 per cent. of
the Company's assets at cost at the time of investment. The value of an
individual investment is expected to increase over time as a result of
trading progress and a continuous assessment is made of investments'
suitability for sale. It is possible that individual holdings may grow
in value to a point where they represent a significantly higher
proportion of total assets prior to a realisation opportunity being
available.
Borrowing powers
The Company's maximum exposure in relation to gearing is restricted to
10 per cent. of the adjusted share capital and reserves. The Directors
do not have any intention of utilising long-term gearing.
Background to the Company
The Company is a VCT which raised GBP14.3 million in December 2000, 2002
and raised a further GBP35.0 million during 2006 through the launch of a
C share issue. The Company has raised a further GBP54.7 million under
the Albion VCTs' Top Up Offers since January 2011.
On 15 November 2013, the Company acquired the assets and liabilities of
Albion Income & Growth VCT PLC in exchange for new shares in the Company
resulting in a further GBP28.1 million of net assets.
Financial calendar
Annual General Meeting Noon on 27 May 2021
Record date for first dividend 4 June 2021
Payment date of first dividend 30 June 2021
Announcement of Half-yearly results for the six months September 2021
ending 30 June 2021
Financial summary
185.30p Total shareholder value per Ordinary share since launch
-------------------------------------------------------
(0.28)p Total loss per share for the year ended 31 December
2020 (0.3% loss on opening net asset value per share)
-------------------------------------------------------
12.95p Total tax-free dividend per Ordinary share paid in
the year to 31 December 2020
-------------------------------------------------------
69.35p Net asset value per Ordinary share as at 31 December
2020
-------------------------------------------------------
31 December 2020 (pence 31 December 2019 (pence
per share) per share)
Opening net asset value 82.58 77.40
Capital (loss)/return (0.06) 8.81
Revenue (loss)/return (0.22) 0.47
----------------------- -----------------------
Total (loss)/return (0.28) 9.28
Ordinary dividends paid (3.95) (4.00)
Special dividend paid (9.00) -
Impact from share
capital movements - (0.10)
----------------------- -----------------------
Net asset value 69.35 82.58
------------------------ ----------------------- -----------------------
Total shareholder value Ordinary share
to 31 December 2020 (pence per share)
------------------------ --------------------------------------------------
Total dividends paid
during the year ended:
31 December 2001 1.00
31 December 2002 2.00
31 December 2003 1.50
31 December 2004 7.50
31 December 2005 9.00
31 December 2006 8.00
31 December 2007 8.00
31 December 2008 16.00
31 December 2009 -
31 December 2010 8.00
31 December 2011 5.00
31 December 2012 5.00
31 December 2013 5.00
31 December 2014 5.00
31 December 2015 5.00
31 December 2016 5.00
31 December 2017 4.00
31 December 2018 4.00
31 December 2019 4.00
31 December 2020 12.95
Total dividends paid to
31 December 2020 115.95
Net asset value as at 31
December 2020 69.35
--------------------------------------------------
Total shareholder value
to 31 December 2020 185.30
--------------------------------------------------
In addition to the dividends summarised above, the Board has declared a
first dividend for the year ending 31 December 2021 of 1.73 pence per
share to be paid on 30 June 2021 to shareholders on the register on 4
June 2021.
Further details regarding the total shareholder value for C Shares and
Albion Income and Growth VCT PLC can be found at
www.albion.capital/funds/AATG under the 'Financial Summary for Previous
Funds' section.
Notes
Total shareholder value for every 100 pence invested on initial
allotment. The table above excludes tax benefits upon subscription.
Chairman's statement
Introduction
In a year which has been difficult for many people and businesses, our
portfolio companies have demonstrated resilience and, in many cases,
growth, providing products and services that are both innovative and
necessary, even in these uncertain times. Against the difficult backdrop
occasioned by the pandemic, the results for the Company show a small
total loss of 0.28 pence per share for the year ended 31 December 2020.
This is a very creditable performance given the challenging economic
conditions of the last twelve months.
Results and dividends
As at 31 December 2020, the net asset value was 69.35 pence per share
compared to 82.58 pence per share at 31 December 2019. The total loss
after tax was GBP0.3 million compared to GBP10.2 million total return in
the year to 31 December 2019.
The Company paid dividends totalling 12.95 pence per share during the
year ended 31 December 2020 (2019: 4.0 pence per share). This year's
dividends included a special dividend of 9.0 pence per share, paid on 30
October 2020, to maintain the Company's VCT status under HMRC rules
following some very successful realisations in the prior year.
Notwithstanding the special dividend paid during the year, the dividend
objective of the Board is to provide shareholders with a strong,
predictable dividend flow.
As set out in the Half-yearly Financial Report to 30 June 2020, the
Board considered it appropriate to move to a variable dividend policy
targeting an annual dividend yield of around 5%, based on prevailing net
asset value rather than at a fixed rate, as had been the case in the
past. Semi-annual dividends will be paid, calculated as 2.5% of the most
recently announced net asset value when the dividend is declared (in
most cases this will be the net asset value announced in the Half-yearly
Financial Report or in the Annual Report and Financial Statements).
Therefore, the Board has declared a first dividend for the year ending
31 December 2021 of 1.73 pence per share to be paid on 30 June 2021 to
shareholders on the register on 4 June 2021.
Investment portfolio
The results for the year showed net gains on investments of GBP1.5
million, against gains of GBP11.2 million for the previous year, which
were largely driven by unrealised gains across the portfolio. Quantexa
increased in value by GBP2.8 million following an externally led funding
round in which we participated, and Proveca increased in value by GBP1.2
million following strong trading across Europe. Against this, unrealised
write-downs were made against our investment in Mirada Medical (GBP2.7
million) as their direct sales model into hospitals became difficult
during the Coronavirus (Covid-19) pandemic, and Black Swan Data (GBP1.0
million) reflecting a restructure to focus on its data analytics
business.
The company had a number of investment realisations in the year: its
investment in G. Network Communications was sold for a total return on
all monies invested of 3.8 times cost or 31% IRR; and its investment in
Clear Review was sold generating a return of 2.1 times cost within a
relatively short 16 month holding period. These gains were partially
offset by a realised loss on the sale of our holding in the SVS Albion
OLIM UK Equity Income Fund. Further details on the above disposals, and
other realisations, can be found in the realisations table on page 26 of
the full Annual Report and Financial Statements.
During the year, a total of GBP9.2 million was deployed into portfolio
companies, of which GBP4.4 million was invested across six new portfolio
companies, all of which are likely to require further investment as the
companies prove themselves and grow:
-- GBP1.6 million into Concirrus, a software provider bringing real-time
behavioural data analytics to the marine and transport insurance sector;
-- GBP1.0 million into The Voucher Market (trading as WeGift), a provider of
a cloud platform that enables corporates to purchase digital gift cards
and to distribute them to employees and customers;
-- GBP1.0 million into Credit Kudos, a challenger credit bureau helping
lenders optimise and automate their affordability and risk assessments;
-- GBP0.4 million into TransFICC, a provider of connectivity solutions,
giving financial institutions access to trading venues via a single API;
-- GBP0.3 million into Seldon Technologies, a software company that enables
enterprises to deploy machine learning models in production; and
-- GBP0.1 million into uMedeor (trading as uMed), a provider of a middleware
technology platform that enables life science organisations to conduct
medical research programmes.
A further GBP4.8 million was invested into existing portfolio companies,
including GBP2.0 million into Quantexa, GBP1.1 million into Oxsensis and
GBP0.4 million into uMotif.
Overall, 26% of the portfolio by value is profitable, measured by
earnings before interest, tax and depreciation, with a number of our
investments showing strong growth in fast-developing international
markets. Given the evolving nature of the portfolio, increasingly the
return will be in the form of capital rather than income. As part of
portfolio management, the Board always maintains liquidity to meet
future potential investments, running costs and, importantly, cash for
payment of dividends and to facilitate share buy-backs.
Board composition
The Board announced on 9 July 2020 that, following a formal selection
process, Margaret Payn would be appointed to the Board as a
non-executive Director with effect from 3 August 2020. Margaret has
extensive experience across the financial sector. Most recently, she was
appointed as a non-executive Director of JP Morgan Mid Cap Investment
Trust plc. The Board welcomes Margaret and looks forward to working with
her over the coming years.
I have had the privilege of being Chairman of your Company since its
launch in 2000 and I have indicated to the Board that I will retire at
the Annual General Meeting in May 2021. I am delighted that Robin
Archibald, who has been on the Board as Audit Chairman since 2013, will
succeed me as Chairman, and Margaret Payn will succeed Robin as chairman
of the Audit Committee.
It has been a huge pleasure to Chair your Company and I would like to
thank my fellow Directors (past and present), the Albion management and
staff, our advisers and service providers, and all our shareholders for
their support over the years.
Risks and uncertainties
The highly uncertain outlook for the UK and Global economies remains the
key risk affecting the Company, with the continuing health risk clouding
any evaluation of risk and returns for many companies in the developed
world. While many of our portfolio companies have shown remarkable
resilience during the Coronavirus (Covid-19) pandemic, there are some
underlying portfolio companies that continue to be adversely affected by
the pandemic. There are also the implications of the UK's recent
departure from the European Union which may adversely affect some of the
underlying portfolio companies. The Manager is continually assessing the
exposure to these risks for each portfolio company and appropriate
actions, where possible, are being implemented.
The Manager has a clear focus to allocate resources to those sectors and
opportunities where it believes growth can be both resilient and
sustainable, with provision of cash to assist some portfolio companies
in these extreme market conditions being a likelihood. The new VCT rules
continue to result in the gradual reduction of the asset-based element
of the portfolio in favour of growth and technology companies which will
inevitably increase volatility over time.
A detailed analysis of the other principal risks and uncertainties
facing the business is shown in the Strategic report below.
Annual General Meeting
The Board has been considering the current rules around the Covid-19
pandemic on the arrangements for our forthcoming Annual General Meeting
("AGM"). These arrangements may be subject to change and we will keep
shareholders up to date on our Manager's website at
www.albion.capital/vct-hub/agms-events.
We are required by law to hold an AGM within six months of our financial
year end. Whilst the roadmap announced by the government gives a target
of no earlier than 21 June 2021 as the date when all legal limits on
mixing will be lifted, the Board is hesitant to delay the AGM as the
roadmap is clear that data rather than dates are the true driver of
restrictions. Our AGM will, therefore, be held at noon on 27 May 2021,
at the registered office being 1 Benjamin Street, London, EC1M 5QL.
Full details of the business to be conducted at the Annual General
Meeting are given in the Notice of the Meeting on pages 70 to 73 of the
full Annual Report and Financial Statements and in the Directors' report
on pages 35 and 36 of the full Annual Report and Financial Statements.
Covid-19 social distancing restrictions will still be in place, and
consequently it will not be possible to allow shareholders entry into
the building where the AGM is held. The quorum for the meeting is two,
therefore two Directors will attend in person to allow the continuation
of this AGM. There will also be a representative of Albion Capital Group
LLP as Company Secretary. Our Articles of Association do not currently
allow hybrid or wholly virtual AGMs, however, as outlined below a
resolution is being proposed to allow this in the future.
In order to maintain shareholder engagement, the Board has decided to
live stream the AGM, which will include a presentation from the Manager,
the formal business of the AGM and answers to questions we receive from
shareholders. Registration details for the live stream will be available
at www.albion.capital/funds/AATG prior to the Meeting.
We always welcome questions from our shareholders at the AGM, and again
this year we request that shareholders submit questions to the Board in
advance of the AGM. Shareholders can submit questions up until noon on
26 May 2021 by emailing questions to AATGchair@albion.capital. Following
the Meeting, a summary of responses will be published on the Manager's
website at www.albion.capital/funds/AATG. The Board strongly encourages
shareholders to return their proxy votes in advance of the meeting.
Shareholders' views are important, and the Board encourages shareholders
to vote on the resolutions using the proxy form enclosed with this
Annual Report and Financial Statements, or electronically at
www.investorcentre.co.uk/eproxy. The Board has carefully considered the
business to be approved at the AGM and recommends shareholders to vote
in favour of all the resolutions being proposed.
Virtual and hybrid Annual General Meetings
As noted above, the Company's Articles of Association do not currently
allow for hybrid or virtual meetings. The Coronavirus (Covid-19)
pandemic, and the resulting social distancing rules, have brought to the
Board's attention the importance of the ability to continue to interact
with shareholders during unprecedented times. A resolution will be
proposed at the upcoming AGM to update the Articles of Association to
allow the Company to have the flexibility to hold hybrid or virtual
meetings in the future, if required.
Share buy-backs
It remains the Board's primary objective to maintain sufficient
resources for investment in new and existing portfolio companies and for
the continued payment of dividends to shareholders. The Board's policy
is to buy back shares in the market, subject to the overall constraint
that such purchases are in the Company's interest. It is the Board's
intention for such buy-backs to be in the region of a 5 per cent.
discount to net asset value, so far as market conditions and liquidity
permit. The Board continues to review the use of buy-backs and is
satisfied that it is an important means of providing market liquidity
for shareholders.
Albion VCTs' Prospectus Top Up Offers
Your Board, in conjunction with the boards of other VCTs managed by
Albion Capital Group LLP, launched a prospectus top up offer of new
Ordinary shares on 5 January 2021. The Board announced on 17 February
2021 that, following strong demand for the Company's shares, it had
elected to exercise GBP1.5 million of its GBP3 million over-allotment
facility, taking the total offer to GBP15.5 million. On 24 February
2021, the Company was pleased to announce that it had reached its
GBP15.5 million limit under its Offer which was fully subscribed and
closed to further applications.
The funds raised by the Company pursuant to the Offer will be added to
the liquid resources available for investment, putting the Company into
a position to take advantage of investment opportunities over the next
two to three years. The proceeds of the Offer will be applied in
accordance with the Company's investment policy. The Company continues
to participate in the Top Up Offers and also benefits from investors'
participation in the Dividend Reinvestment Scheme; the net proceeds are
invested in new investment opportunities and provide additional working
capital in the Company. It is important that the Company continues to
have cash available for future investments and the Top Up Offers and
dividend reinvestments are important sources of that capital.
Outlook and prospects
Whilst there are still uncertainties as to the full extent of the
ongoing economic and societal impact of the Coronavirus (Covid-19)
pandemic, we are encouraged by the resilience of the portfolio and many
of the companies in which we have invested continue to show strong
growth. It continues to be our priority to support our existing
portfolio and to make new investments in businesses that can innovate
and grow despite the healthcare crisis. The Board remains confident that
the Company and its portfolio are well positioned to continue to
generate long term value for shareholders.
I have very much enjoyed my long tenure as Chairman and look forward to
seeing the Company continue to prosper in the years ahead.
Dr. N E Cross
Chairman
26 March 2021
Strategic report
Investment objective and policy
The Company's investment objective is to provide investors with a
regular and predictable source of dividend income, combined with the
prospect of long-term capital growth, through a balanced portfolio of
unquoted growth and technology businesses in a qualifying VCT.
The Company will invest in a broad portfolio of unquoted growth and
technology businesses. Allocation of assets will be determined by the
investment opportunities which become available, but efforts will be
made to ensure that the portfolio is diversified in terms of sectors and
stages of maturity of portfolio companies.
The full investment policy can be found above.
Current portfolio sector allocation
The pie charts at the end of this announcement show the split of the
portfolio valuation as at 31 December 2020 by sector, stage of
investment and number of employees. This is a useful way of assessing
how the Company and its portfolio is diversified across sector,
portfolio companies' maturity measured by revenues and their size
measured by the number of people employed. Details of the principal
investments made by the Company are shown in the Portfolio of
investments on pages 24 to 26 of the full Annual Report and Financial
Statements.
Direction of portfolio
The current portfolio remains well-balanced both in terms of stage of
investment and sectors, with software and other technology accounting
for 43%, healthcare (including digital healthcare) accounting for 16%,
renewable energy accounting for 14% and education accounting for 8%. The
Company's holding in software and other technology investments has
increased significantly in the year to 43% as we invest in key areas
such as cyber security and machine learning applications. Cash levels
decreased significantly during the year from 37% to 14% of net asset
value due to the large number of investments made and the payment of the
special dividend on 30 October 2020. Following the first allotment under
the Albion VCTs' Prospectus Top Up Offers 2020/21 on 26 February 2021,
cash has increased as a proportion of the portfolio since the year end.
In line with the Company's investment policy, investment continues to be
made predominately into higher growth technology companies. The Company
will support those portfolio companies who require it, as well as
capitalise on any new investment opportunities that arise. We therefore
expect that investments in the software and other technology and
healthcare sectors (including digital healthcare) will continue to
increase, and that asset-based investments will decrease over the coming
years.
Results and dividends Ordinary shares
GBP'000
Net revenue loss for the year ended 31 December 2020 (248)
Net capital loss for the year ended 31 December 2020 (63)
---------------
Total loss for the year ended 31 December 2020 (311)
Dividend of 2.00 pence per share paid on 30 June 2020 (2,201)
Special dividend of 9.00 pence per share paid 30 October
2020 (9,942)
Dividend of 1.95 pence per share paid on 31 December
2020 (2,185)
Transferred from reserves (14,639)
---------------
Net assets as at 31 December 2020 78,028
===============
Net asset value per share as at 31 December 2020 69.35p
========================================================= ===============
The Company paid dividends of 12.95 pence per share during the year
ended 31 December 2020 (2019: 4.0 pence per share). The Board has a
variable dividend policy which targets an annual dividend yield of
around 5% on the prevailing net asset value. The Board has declared a
first dividend for the year ending 31 December 2021 of 1.73 pence per
share to be paid on 30 June 2021 to shareholders on the register on 4
June 2021.
As shown in the Income statement below, investment income has decreased,
as expected, to GBP604,000 (2019: GBP1,416,000). This is due to an
increase in loan stock where interest is being rolled up, loan stock
repayments in the year (and in recent years), and the sale of the
Company's holding in the SVS Albion OLIM UK Equity Income Fund. As a
result, there is a revenue loss to equity holders of GBP248,000 (2019:
return of GBP519,000).
The net capital loss for the year was GBP63,000 (2019: gain
GBP9,645,000). This is mainly attributable to the portion of the
management fee charged through the realised capital reserve partially
offset by the gains on investments during the year. Key valuation
movements during the year are outlined in the Investment portfolio
section of the Chairman's statement. The total loss for the period was
0.28 pence per share (2019: return of 9.28 pence per share).
During the year, the Manager took the decision to dispose of the
Company's investment in the SVS Albion OLIM UK Equity Income Fund
following a period of poor performance, with the fund being impacted by
the Coronavirus (Covid-19) driven falls of UK quoted equities and the
negative outlook for the UK Equity Income sector. It is the Board's
intention that the sale proceeds shall be redeployed into innovative
unquoted growth companies where the Company is seeing resilient growth.
This has resulted in a disappointing GBP0.4 million loss on cost, after
allowing for dividends received and reduction in management fees over
the life of the investment.
The Balance sheet below shows that the net asset value per share has
decreased over the last year to 69.35 pence per share (2019: 82.58 pence
per share). The decrease in net asset value is principally attributed to
the payment of 12.95 pence per share of dividends, including the special
dividend of 9.0 pence per share, and the total loss of 0.28 pence per
share.
The cash outflow for the year was GBP21 million (2019: GBP25 million
inflow). This was mainly as a result of the dividends paid of GBP12.2
million, GBP9.2 million of new and follow-on investments, and share
buy-backs of GBP1.5 million. The outflow was reduced by GBP3.5 million
received from the disposal of fixed and current asset investments and
receipt of deferred consideration. There has been substantial cash
inflow post year end as a result of the successful top up offer.
Review of business and outlook
A review of the Company's business during the year and future prospects
is contained in the Chairman's statement above and in this Strategic
report.
As a greater emphasis continues to be given to growth and technology
investments, we expect that asset-based investments will continue to
decrease over time as a proportion of the portfolio with future returns
coming largely from capital gains. Investment income predominantly
consists of loan stock interest on our renewable energy investments,
which the Company intends to hold for the longer term. As a result,
investment income is expected to remain relatively flat over the near
term.
Details of significant events which have occurred since the end of the
financial year are listed in note 19. Details of transactions with the
Manager are shown in note 5.
Future prospects
Whilst there are still uncertainties as to the full extent of the
ongoing economic and societal impact of the Coronavirus (Covid-19)
pandemic, we are encouraged by the resilience of the portfolio and many
of the companies in which we have invested continue to show strong
growth. The Board remains confident that the Company and its portfolio
are well positioned to continue to generate long term value for
shareholders. The Company's portfolio remains well balanced across
sectors and risk classes and the Manager has a strong pipeline of
investment opportunities in which the Company's cash can be deployed.
Key Performance Indicators ("KPIs") and Alternative Performance Measures
("APMs")
The Directors believe that the following KPIs and APMs, which are
typical for VCTs, used in the Board's assessment of the Company, will
provide shareholders with sufficient information to assess how
effectively the Company is applying its investment policy to meet its
objectives. The Directors are satisfied that the results shown in the
following KPIs and APMs give a good indication that the Company is
achieving its investment objective and policy. These are:
1. Net asset value per share and total shareholder value
Please see the "Total shareholder value to 31 December 2020" table above
in the Financial summary section which shows the NAV per share as at 31
December 2020 and total shareholder value. Total shareholder value is
net asset value plus cumulative dividends paid since launch.
Total shareholder value decreased by 0.28 pence to 185.30 pence per
Ordinary share for the year ended 31 December 2020 (0.3 per cent. on the
opening net asset value). This is a very respectable performance given
the challenging economic conditions of the last twelve months.
The graph on page 4 of the full Annual Report and Financial Statements
reflects the total shareholder value performance of the Company relative
to the FTSE All-share Index.
2. Movement in shareholder value in the year
2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
---- ---- ---- ---- ------ ---- ---- ----- ----- ------
2.9% 4.6% 8.0% 2.5% (4.7%) 3.6% 6.0% 13.2% 11.9% (0.3%)
---- ---- ---- ---- ------ ---- ---- ----- ----- ------
Source: Albion Capital Group LLP
Calculated as the movement in total shareholder value for the year
divided by the opening net asset value.
The returns to Shareholders who have acquired shares through the C share
issue in 2006 and the merger with Albion Income & Growth VCT in 2013 are
shown on the Company's Webpage on the Manager's website at
https://www.globenewswire.com/Tracker?data=PVnDoECJEFxyrV2mKasD0zjDbT_f4aKewzt2Ro_oSQQi2pn7U8vxpHmWoSbyi75pTW5v0LQ3Kv6cuKilhgNURl-M72GPR5UUZhEEDn3CdvRKB6kZmPuPKmWk2KXSQWON
www.albion.capital/funds/AATG under "Financial Summary for Previous
Funds". Shareholders who have acquired shares through Top Up Offers, the
dividend reinvestment scheme or in the market outside the corporate
events will be able to calculate their own returns based on the price at
which they acquired their shares, the dividends they have received since
the purchase and the current net asset value of their holding.
3. Dividend distributions
Dividends paid in respect of the year ended 31 December 2020 were 12.95
pence per share (2019: 4.0 pence per share); 3.95 pence per share in
ordinary dividends and a 9.0 pence per share special dividend. During
the year, the Board changed to a variable dividend policy. Further
details of the dividend policy can be found in the Chairman's statement
above. Cumulative dividends paid since inception are 115.95 pence per
Ordinary share.
4. Ongoing charges
As agreed with the Manager in 2015, the ongoing charges ratio for the
year ended 31 December 2020 was capped at 2.75 per cent. (2019: 2.75 per
cent.) with any excess over the cap being a reduction in the management
fee. The ongoing charges ratio has been calculated using The Association
of Investment Companies' (AIC) recommended methodology. This figure
shows shareholders the total recurring annual running expenses
(including investment management fees charged to capital reserves) as a
percentage of the average net assets attributable to shareholders. The
Directors expect the ongoing charges ratio for the year ahead to be 2.75
per cent. (capped at 2.75 per cent.).
The reduction in management fees payable to Albion Capital Group LLP in
the year, due to the expense cap, amounted to GBP78,000 (2019:
GBP136,000).
5. VCT regulation*
The investment policy is designed to ensure that the Company continues
to qualify and is approved as a VCT by HMRC. In order to maintain its
status under VCT legislation, a VCT must comply on a continuing basis
with the provisions of Section 274 of the Income Tax Act 2007, details
of which are provided in the Directors' report on page 33 of the full
Annual Report and Financial Statements.
The relevant tests to measure compliance have been carried out and
independently reviewed for the year ended 31 December 2020. These
confirmed that the Company has complied with all tests and continues to
do so.
*VCT compliance is not a numerical measure of performance and thus
cannot be defined as an APM.
Gearing
As defined by the Articles of Association, the Company's maximum
exposure in relation to gearing is restricted to 10 per cent. of the
adjusted share capital and reserves. Although the investment policy
permits the Company to borrow, the Directors do not currently have any
intention of utilising long-term gearing and have not done so in the
past.
Operational arrangements
The Company has delegated the investment management of the portfolio to
Albion Capital Group LLP, which is authorised and regulated by the
Financial Conduct Authority. Albion Capital Group LLP also provides
company secretarial and other accounting and administrative support to
the Company under the Management agreement, as well as acting as the
Company's Alternative Investment Fund Manager ("AIFM").
Management agreement
Under the Management agreement, the Manager provides investment
management, secretarial and administrative services to the Company. The
Management agreement can be terminated by either party on 12 months'
notice and is subject to earlier termination in the event of certain
breaches or on the insolvency of either party. The Manager is paid an
annual fee equal to 2.5 per cent. of the net asset value of the Company,
payable quarterly in arrears. The total annual running costs of the
Company, including fees payable to Albion Capital Group LLP, Directors'
fees, professional fees and the costs incurred by the Company in the
ordinary course of business (but excluding any exceptional items and
performance fees payable to Albion Capital Group LLP) are capped at an
amount equal to 2.75 per cent. of the Company's net assets, with any
excess being met by Albion Capital Group LLP by way of a reduction in
management fees.
Additionally, Albion Capital Group LLP agreed to reduce that proportion
of its management fee relating to the investment in the SVS Albion OLIM
UK Equity Income Fund ("OUEIF") in order to avoid any double charging of
fees for the investment exposure. The investment in the OUEIF was
disposed of during the year, and therefore there is no continuing
exposure.
In some instances, the Manager is entitled to an arrangement fee,
payable by a portfolio company in which the Company invests, in the
region of 2.0 per cent. of the investment made, and also monitoring fees
where the Manager has a representative on the portfolio company's board.
Further details of the Manager's fee can be found in note 5.
Management performance incentive
In order to provide the Manager with an incentive to maximise the return
to investors, the Manager is entitled to charge an incentive fee in the
event that the returns exceed minimum target levels per share.
Under the incentive arrangement, if the net asset value per share at the
end of a financial period, when added to the aggregate dividends per
share (both revenue and capital) paid to that date, exceeds GBP1
(increased at the rate of RPI plus 2 per cent. per annum uncompounded
from the date of first admission to the Official List of the relevant
class of share), then the Manager will be entitled to an incentive fee
equal to 15 per cent. of such excess. In the event that the performance
of the Company falls short of the target in any period, such shortfall
must be made up in future periods before the Manager is entitled to any
incentive in respect of such future periods.
The fee if applicable, will be payable annually. No performance fee has
arisen during the year (2019: GBPnil). There has been no performance fee
paid since the year ended 31 December 2005. The performance threshold at
31 December 2020 was 202.92 pence for the Ordinary shares, 176.12 pence
for the former C shares and 181.92 pence for the former Income & Growth
shares which compares to total returns of 185.30 pence, 108.20 pence and
112.09 pence respectively, based on the latest NAV.
Investment and co-investment
The Company co-invests with other Albion Capital Group LLP managed VCTs
and funds. Allocation of investments is on the basis of an allocation
agreement which is based, inter alia, on the ratio of cash available for
investment in each of the entities and the HMRC VCT qualifying tests.
Liquidity Management
The Board examines regularly both the liquidity of the Company's shares
in the secondary market, which is substantially influenced by the use of
share buy back and share issuance, and the liquidity of the Company's
portfolio. The nature of investments in a venture capital portfolio is
longer term and these are relatively illiquid in the short term.
Consequently, the Company maintains sufficient liquidity in cash and
near cash assets to cover the operating costs of the Company and to meet
dividend payments and share buy-backs, as well as to have the capacity
to make fresh investments when the opportunities arise. Although the
Company is authorised to borrow, in practice it does not borrow. The
Board has no intention that the Company should borrow given the nature
of the Company's investments, a number of which have their own gearing.
Management of liquidity is one of the key operational areas that the
Board discusses regularly with the Manager.
Evaluation of the Manager
The Board has evaluated the performance of the Manager based on:
-- the returns generated by the Company;
-- the continuing achievement of the 80 per cent. qualifying holdings
investment requirement for VCT status;
-- the long term prospects of the current portfolio of investments;
-- the management of treasury, including use of share buy-backs and
participation in fund raising;
-- a review of the Management agreement and the services provided therein;
-- benchmarking the performance of the Manager to other service providers,
including the performance of other VCTs that the Manager is responsible
for managing: and
-- the contribution made by the administration and secretarial team to the
operation of the Company.
The Board believes that it is in the interests of shareholders as a
whole, and of the Company, to continue the appointment of the Manager
for the forthcoming year.
Alternative Investment Fund Managers Directive ("AIFMD")
The Board appointed Albion Capital Group LLP as the Company's AIFM in
2014 as required by the AIFMD. The Manager became a full-scope AIFM
under the AIFMD in 2018. As a result, from that date, Ocorian Depositary
(UK) Limited was appointed as Depositary to oversee the custody and cash
arrangements and provide other AIFMD duties with respect to the Company.
This provides another degree of oversight over the custody of the
Company's assets.
Companies Act 2006 Section 172 Reporting
Under Section 172 of the Companies Act 2006, the Board has a duty to
promote the success of the Company for the benefit of its members as a
whole, having regard to the interests of other stakeholders in the
Company, such as suppliers, and to do so with an understanding of the
impact on the community and environment and with high standards of
business conduct, which includes acting fairly between members of the
Company.
The Board is very conscious of these wider responsibilities in the way
it promotes the Company's culture and ensures, as part of its regular
oversight, that the integrity of the Company's affairs is foremost in
the way the activities are managed and promoted. This includes regular
engagement with the wider stakeholders of the Company and being alert to
issues that might damage the Company's standing in the way that it
operates. The Board works very closely with the Manager in reviewing how
stakeholder issues are handled, ensuring good governance and
responsibility in managing the Company's affairs, as well as visibility
and openness in how the affairs are conducted.
The Board considers its significant stakeholder groups to be its
Shareholders; suppliers, including direct agents of the Company such as
the Manager to whom most executive functions are delegated; the
community and the environment in the way that investments are made and
managed. The Board also considers the portfolio companies to be
stakeholders in the long-term success of the Company. By the nature of
venture capital investment, the Manager is closely involved with all the
portfolio companies.
The Company's shareholders are key to the success of the Company. The
Board seeks to create value for shareholders by generating strong and
sustainable returns to provide shareholders with regular dividends and
the prospect of capital growth. During the year, the Board approved a
new dividend policy, further details of which can be found above in the
Chairman's statement. The new variable dividend policy has the advantage
of avoiding unsustainably high dividends if the net asset value falls,
whilst rewarding shareholders more immediately if the net asset value
rises.
During the year, the Board declared a special dividend of 9.00 pence per
share, which was paid on 30 October 2020 to shareholders on the register
on 9 October 2020. The Board made the decision to pay this special
dividend following a review of the foreseeable cash requirements of the
Company. While it is important for a venture capital fund, which by its
nature has illiquid investments, to hold sufficient cash to manage
operating costs, to service dividends and buy backs and, most
importantly, to make follow on and new investments when they arise, this
had to be balanced against meeting the requirement of a Venture Capital
Trust to be invested in qualifying investments. The holding of cash is
not a qualifying investment for these purposes, and therefore the
special dividend was declared given the significant cash balances
following a number of disposals in the year ended 31 December 2019.
The Board temporarily suspended buy-backs on 18 March 2020 due to the
increasing uncertainty of the net asset value at the time. Buy-backs
were resumed from 22 April 2020 after the announcement of the Interim
Management Statement which included the net asset value for 31 March
2020. The buy-back policy is an important means of providing market
liquidity for shareholders. This action demonstrated acting in
shareholders' best interests, both for those wishing to sell their
shares and for continuing shareholders, by ensuring that there was a
contemporary net asset value in the market to operate buy-backs against,
following the advent of the health crisis and its impact on asset
values.
Shareholders' views are important. The Board encourages Shareholders to
vote on the resolutions at the Annual General Meeting ("AGM"). The
Company's AGM is used typically as an opportunity to communicate with
investors, including through a presentation made by the investment
management team. However, due to the impact of the Coronavirus
(Covid-19) pandemic, special circumstances are required for this year's
AGM and further details are above in the Chairman's statement. Details
of the AGM can be found in the Directors' report on page 35 of the full
Annual Report and Financial Statements.
Shareholders are also encouraged to attend the annual Shareholders'
Seminar. The seminars include some of the portfolio companies sharing
insights into their businesses and also have presentations from Albion
executives on some of the key factors affecting the investment outlook,
as well as a review of the past year and the plans for the year ahead.
Details of the seminar events are placed on the Manager's website.
Representatives of the Board attend the seminars.
The Company is an externally managed investment company with no
employees, and as such has nothing to report in relation to employee
engagement but does keep close attention to how the Board operates as a
cohesive and competent unit. The Company also has no customers in the
traditional sense and, therefore, there is nothing to report in relation
to relationships with customers.
The Company's suppliers are fundamental to the operations of the Company,
particularly Albion Capital Group LLP as the Manager, given that
day-to-day management responsibilities are sub-contracted to the
Manager. The Board takes close account of how the Manager operates, with
very close contact during the year and not just at scheduled Board
meetings. Details of the Manager's and Board's responsibilities can be
found in the Statement of corporate governance on pages 38 to 42 of the
full Annual Report and Financial Statements.
The contractual arrangements with all the principal suppliers to the
Company are reviewed regularly and formally once a year, alongside the
performance of the suppliers in acquitting their responsibilities. The
performance of the Manager in managing the portfolio and in providing
company secretarial, administration and accounting services is reviewed
in detail each year; this review includes reviewing comparator
engagement terms and portfolio performance. Further details on the
evaluation of the Manager, and the decision to continue the appointment
of the Manager for the forthcoming year, can be found in this report.
The portfolio companies are considered key stakeholders, not least
because they are principal drivers of value for the Company. As
discussed in the Environmental, Social and Governance ("ESG") section
below, the portfolio companies' impact on their stakeholders is also
important to the Company. In most cases, an Albion executive has a place
on the board of a portfolio company, in order to help with both business
operation decisions, as well as good ESG practice.
The Board receives reports on ESG factors within its portfolio from
Albion Capital Group LLP as it is a signatory of the UN Principles for
Responsible Investment ("UN PRI"). Further details of this are set out
below. ESG, without its specific definition, has always been at the
heart of the responsible investing that the Company engages in and in
how the Company conducts itself with all of its stakeholders.
The Board, although non-executive, is fully engaged in both oversight
and the general strategic direction of the Company. During the year the
Board's main strategic discussions focussed around cash management and
deployment of cash for future investments, dividends and share buy-backs,
resulting in the decision to participate in the Albion VCTs' Top Up
Offers 2020/21. During the year, the Board held a further meeting in
addition to its scheduled quarterly meetings to discuss the effect of
the Coronavirus (Covid-19) pandemic on the Company's portfolio and to
monitor the resilience of the various agents to the Company.
Environmental, Social, and Governance ("ESG")
The Company's Manager, Albion Capital Group LLP, takes the concept of
sustainable and responsible investment very seriously for existing
investments made and in reviewing new investment opportunities. In turn,
the Board is kept appraised of ESG issues in connection with both the
portfolio and in how Company affairs are conducted more generally as a
regular part of Board oversight.
Albion Capital Group LLP is a signatory of the UN PRI. The UN PRI is the
world's leading proponent of responsible investment, working to
understand the investment implications of ESG factors and to support its
international network of investor signatories in incorporating these
factors into their investment and ownership decisions.
The Board and Manager have exercised conscious principles in making
responsible investments throughout the life of the Company, not least in
providing finance for promising companies in a variety of important
sectors such as technology, healthcare and renewable energy. In making
the investments, the Manager is directly involved in the oversight and
governance of these investments, including ensuring standards of
reporting and visibility on business practices, all of which are
reported to the Board of the Company. By its nature, not least in making
qualifying investments which fulfil the criteria set by HMRC, the
Company has focused on sustainable and longer-term investment
propositions, some of which will fail (in the nature of all small
companies), but some of which will grow and serve important societal
demands. One of the most important drivers of performance is the quality
of the investment portfolio, which goes beyond the individual valuations
and examines the prospects of each of the portfolio companies, as well
as the sectors in which they operate -- all requiring a longer-term
view.
In the nature of venture capital investment, Albion Capital Group LLP is
more intimately involved in the affairs of portfolio companies than
might be the case for funds invested in listed securities. As such,
Albion Capital Group LLP is in a position to influence good governance
and behaviour in the portfolio companies, many of which are relatively
small companies without the support of a larger company's administration
and advisory infrastructure.
The Company adheres to the principles of the AIC Code of Corporate
Governance and is also aware of other governance and corporate conduct
guidance which it meets as far as practical, including in the
constitution of a diversified and independent board capable of providing
constructive challenge but also, through its experience of the Company,
continuity over the longer-term investments the Company makes.
The Company's portfolio is currently invested in healthcare, renewable
energy, education, software and other technology (which includes cyber
security and data protection), and business services, with the most
significant percentage of the Company's portfolio invested in sectors
and companies which would be seen by many measures to be both
sustainable and socially aware based on the services they render.
Albion Capital Group LLP incorporates ESG considerations into its
investment decisions. These form part of its process to create value for
investors and develop sustainable long-term strategies for portfolio
companies. Albion Capital Group LLP reports ESG criteria to UN PRI
(annually) and to the Board quarterly.
ESG principles are integrated at the pre-investment, investment and exit
stages. This is reflected in transparency of reporting, governance
principles adopted by the Company and the portfolio companies, and
increasingly in the positive environmental or socially impactful nature
of investments made. Albion Capital Group LLP, where relevant, considers
climate-specific issues in its investment policies and activities.
However, as the majority of the Company's portfolio consists of small
(2-250 Full Time Employees), private, typically software companies with
limited environmental impact, climate change is not considered to be a
significant risk, and actions are proportionate to that risk.
Pre-investment stage
An exclusion list is used to rule out investments in unsustainable areas,
or in areas which might be perceived as socially detrimental. ESG due
diligence is performed on each potential portfolio company to identify
any sustainability risks associated with the investment. Identified
sustainability risks are ranked from low to high and are reported to the
relevant investment committee. The investment committee considers each
potential investment. If sustainability risks are identified,
mitigations are assessed and, if necessary, mitigation plans are put in
place. If this is not deemed sufficient, the committee would consider
the appropriate level and structure of funding to balance the associated
risks. If this is not possible, investment committee approval will not
be provided, and the investment will not proceed.
Investment stage
All new and existing portfolio companies are asked to report against an
ESG Balanced Score Card annually. The ESG Balanced Score Card contains a
number of sustainability factors against which a portfolio company will
be assessed in order to determine the potential sustainability risks and
opportunities arising from the investment. The score cards form part of
the Manager's internal review meetings alongside discussions around
other risk factors, and any outstanding issues are addressed in
collaboration with the portfolio companies' senior management.
Exit stage
Albion Capital Group LLP aim to ensure that good ESG practices remain in
place following exit. For example, by ensuring that the company creates
a self-sustaining ESG management system during our period of ownership,
wherever feasible.
Social and community issues, employees and human rights
The Board recognises the requirement under section 414C of the Companies
Act 2006 (the "Act") to detail information about social and community
issues, employees and human rights; including any policies it has in
relation to these matters and effectiveness of these policies. As an
externally managed investment company with no employees, the Company has
no requirement for formal policies in these matters, however, it is at
the core of its responsible investment as detailed above.
General Data Protection Regulation ("GDPR")
The General Data Protection Regulation has the objective of unifying
data privacy requirements across the European Union, and continues to
apply in the United Kingdom after Brexit. The Manager continues to take
action to ensure that the Manager and the Company are compliant with the
regulation.
Further policies
The Company has adopted a number of further policies relating to:
-- Environment
-- Global greenhouse gas emissions
-- Anti-bribery
-- Anti-facilitation of tax evasion
-- Diversity
These are set out in the Directors' report on page 34 of the full Annual
Report and Financial Statements.
Risk management
The Board carries out a regular review of the risk environment in which
the Company operates, together with changes to the environment and
individual risks. The Board also identifies emerging risks which might
affect the Company. In the period covered by this report the most
noticeable risk has been the global Coronavirus (Covid-19) pandemic
which has impacted not only public health and mobility but also has had
an adverse impact on global traded markets, the full effect of which is
likely to be uncertain for some time. Throughout the last year the Board
has continued to keep close attention to the resilience of the portfolio,
the Company and the circumstance of its agents, and will continue to do
so given the unusual working conditions during the Coronavirus
(Covid-19) pandemic.
The Directors have carried out a robust assessment of the Company's
disclosures below that describe the principal risks and emerging
uncertainties and explain how they are being managed or mitigated. The
principal risks and uncertainties of the Company as identified by the
Board and how they are managed are as follows:
Risk Possible consequence Risk management
----------- --------------------------------------------------------------- --------------------------------------------------------------
Investment, The risk of investment in poor quality businesses, To reduce this risk, the Board places reliance upon
performance which could reduce the returns to shareholders and the skills and expertise of the Manager and its track
and could negatively impact the Company's current and record over many years of making successful investments
valuation future valuations. in this segment of the market. In addition, the Manager
risk By nature, smaller unquoted businesses, such as those operates a formal and structured investment appraisal
that qualify for VCT purposes, are more volatile than and review process, which includes an Investment Committee,
larger, long established businesses. comprising investment professionals from the Manager
The Company's investment valuation methodology is for all investments, and at least one external investment
reliant on the accuracy and completeness of information professional for investments greater than GBP1 million
that is issued by portfolio companies. In particular, in aggregate across all the Albion managed VCTs. The
the Directors may not be aware of, or take into account, Manager also invites and takes account of comments
certain events or circumstances which occur after from non-executive Directors of the Company on matters
the information issued by such companies is reported. discussed at the Investment Committee meetings. Investments
are actively and regularly monitored by the Manager
(investment managers normally sit on portfolio company
boards), including the level of diversification in
the portfolio, and the Board receives detailed reports
on each investment as part of the Manager's report
at quarterly board meetings. The Board and Manager
regularly review the deployment of investments and
cash resources available to the Company in assessing
liquidity required for servicing the Company's buy-backs,
dividend payments and operational expenses.
The unquoted investments held by the Company are designated
at fair value through profit or loss and valued in
accordance with the International Private Equity and
Venture Capital Valuation Guidelines as updated in
2018. These guidelines set out recommendations intended
to represent current best practice on the valuation
of venture capital investments. The valuation takes
into account all known material facts up to the date
of approval of the Financial Statements by the Board.
----------- --------------------------------------------------------------- --------------------------------------------------------------
VCT The Company must comply with section 274 of the Income To reduce this risk, the Board has appointed the Manager,
approval Tax Act 2007 which enables its investors to take advantage which has a team with significant experience in VCT
risk of tax relief on their investment and on future returns. management which is used to operating within the requirements
Breach of any of the rules enabling the Company to of the VCT legislation. In addition, to provide further
hold VCT status could result in the loss of that status. formal reassurance, the Board has appointed Philip
Hare & Associates LLP as its taxation adviser, who
report quarterly to the Board to independently confirm
compliance with the VCT legislation, to highlight
areas of risk and to inform on changes in legislation.
Each investment in a portfolio company is also pre-cleared
with our professional advisers or H.M. Revenue & Customs.
The Company monitors closely the extent of qualifying
holdings and addresses this as required.
----------- --------------------------------------------------------------- --------------------------------------------------------------
Regulatory The Company is listed on The London Stock Exchange Board members and the Manager have experience of operating
and and is required to comply with the rules of the UK at senior levels within, or advising, quoted companies.
compliance Listing Authority, as well as with the Companies Act, In addition, the Board and the Manager receive regular
risk Accounting Standards and other legislation. Failure updates on new regulation, including legislation on
to comply with these regulations could result in a the management of the Company, from its auditor, lawyers
delisting of the Company's shares, or other penalties and other professional bodies. The Company is subject
under the Companies Act or from financial reporting to compliance checks through the Manager's compliance
oversight bodies. officer, and any issues arising from compliance or
regulation are reported to its own board on a monthly
basis. These controls are also reviewed as part of
the quarterly Board meetings, and also as part of
the review work undertaken by the Manager's compliance
officer. The report on controls is also evaluated
by the internal auditors.
----------- --------------------------------------------------------------- --------------------------------------------------------------
Market The market value of Ordinary shares can fluctuate. The Company operates a share buy-back policy, which
value of The market value of an Ordinary share, as well as aims to limit the discount at which the Ordinary shares
Ordinary being affected by its net asset value ("NAV") and trade to around 5 per cent. to NAV, by providing a
shares prospective NAV, also takes into account its dividend purchaser through the Company in absence of market
yield and prevailing interest rates. As such, the purchasers. From time to time buy-backs cannot be
market value of an Ordinary share may vary considerably applied, for example when the Company is subject to
from its underlying NAV. The market prices of shares a close period, or if it were to exhaust and could
in quoted investment companies can, therefore, be not renew any buyback authorities.
at a discount or premium to the NAV at different times, New Ordinary shares are issued at sufficient premium
depending on supply and demand, market conditions, to NAV to cover the costs of issue and to avoid asset
general investor sentiment and other factors, including value dilution to existing investors.
the ability to exercise share buybacks. Accordingly,
the market price of the Ordinary shares may not fully
reflect their underlying NAV.
----------- --------------------------------------------------------------- --------------------------------------------------------------
Operational The Company relies on a number of third parties, in The Company and its operations are subject to a series
and particular the Manager, for the provision of investment of rigorous internal controls and review procedures
internal management and administrative functions. Failures exercised throughout the year and receives reports
control in key systems and controls within the Manager's business from the Manager on its internal controls and risk
risk could place assets of the Company at risk or result management, including on matters relating to cyber
in reduced or inaccurate information being passed security.
to the Board or to shareholders. The Audit Committee reviews the Internal Audit Reports
prepared by the Manager's internal auditors, PKF Littlejohn
LLP. On an annual basis, the Audit Committee chairman
meets with the internal audit partner to provide an
opportunity to ask specific detailed questions in
order to satisfy the Committee that the Manager has
strong systems and controls in place including those
in relation to business continuity and cyber security.
Ocorian Depositary (UK) Limited is appointed as Depositary
to oversee the custody and cash arrangements and provide
other AIFMD duties. The Board reviews the quarterly
reports prepared by Ocorian Depositary (UK) Limited
to ensure that Albion Capital Group LLP is adhering
to its duties as a full-scope AIFM under the AIFMD.
In addition, the Board regularly reviews the performance
of its key service providers, particularly the Manager,
to ensure they continue to have the necessary expertise
and resources to deliver the Company's investment
policy and remain compliant with regulations. The
Manager and other service providers have also demonstrated
to the Board that there is no undue reliance placed
upon any one individual.
----------- --------------------------------------------------------------- --------------------------------------------------------------
Economic, Changes in economic conditions, including, for example, The Company invests in a diversified portfolio of
political interest rates, rates of inflation, industry conditions, companies across a number of industry sectors and
and social competition, political and diplomatic events, such in addition often invests in a mixture of instruments
risk as the impact of Brexit, and other factors could substantially in portfolio companies and has a policy of minimising
and adversely affect the Company's prospects in a any external bank borrowings within portfolio companies.
number of ways. This also includes risks of social At any given time, the Company has sufficient cash
upheaval, including from infection and population resources to meet its operating requirements, including
re-distribution. share buy-backs and follow-on investments.
The current significant exogenous risk to the Company, In common with most commercial operations, exogenous
the wider population and economy, is the Coronavirus risks over which the Company has no control are always
(Covid-19) pandemic. a risk and the Company does what it can to address
these risks where possible, not least as the nature
of the investments the Company makes are long term.
The Board and Manager are continuously assessing the
resilience of the portfolio, the Company and its operations
and the robustness of the Company's external agents
during the Coronavirus (Covid-19) pandemic, as well
as considering longer term impacts on how the Company
might be positioned in how it invests and operates.
Ensuring liquidity in the portfolio to cope with exigent
and unexpected pressures on the finances of the portfolio
and the Company is an important part of the risk mitigation
in these uncertain times.
----------- --------------------------------------------------------------- --------------------------------------------------------------
Viability statement
In accordance with the FRC UK Corporate Governance Code published in
2018 and provision 36 of the AIC Code of Corporate Governance, the
Directors have assessed the prospects of the Company over the three
years to 31 December 2023. The Directors believe that three years is a
reasonable period in which they can assess the future ability of the
Company to continue to operate and meet its liabilities as they fall due
and is also the period used by the Board in the strategic planning
process and is considered reasonable for a business of this nature and
size. The three year period is considered the most appropriate given the
forecasts that the Board requires from the Manager and the estimated
timelines for finding, assessing and completing investments. The three
year period also takes account of the potential impact of any new
regulations, should they be imposed, and how they may affect the Company
over the longer term, as well as the availability of cash, but the
assessment cannot take into account the full extent of the exogenous
risks that may impact on global economies at the date of these accounts.
The Directors have carried out a robust assessment of the emerging and
principal risks facing the Company as explained above, including those
that could threaten its business model, future performance, solvency or
liquidity. The Board also considered the procedures in place to identify
emerging risks and the risk management processes in place to avoid or
reduce the impact of the underlying risks. The Board focused on the
major factors which affect the economic, regulatory and political
environment, including any potential impact from Brexit. The Board,
after careful consideration, believes that Brexit will have no major
impact on the going concern of the Company, primarily due to the markets
our portfolio companies target, which in most cases are the UK and
increasingly, the US, for our software and technology businesses.
Portfolio companies targeting European markets have also shown
resilience so far. The Coronavirus (Covid-19) pandemic remains the
largest uncertainty with the potential to affect the Company. In light
of this continuing uncertainty, robust stress tested cashflows, process
resilience and contingencies have been examined in trying to deal with
the principal risks faced by the Company.
The Board assessed the ability of the Company to raise finance and
deploy capital, as well as the existing cash resources of the Company.
The portfolio is well balanced and geared towards long term growth,
delivering dividends and capital growth to shareholders. In assessing
the prospects of the Company, the Directors have considered the cash
flow by looking at the Company's income and expenditure projections and
funding pipeline over the assessment period of three years and they
appear realistic.
Taking into account the processes for mitigating risks, monitoring costs,
implementing share buy-backs and issuance of new shares, the Manager's
compliance with the investment objective, policies and business model
and the balance of the portfolio, the Directors have concluded that
there is a reasonable expectation that the Company will be able to
continue in operation and meet its liabilities as they fall due over the
three year period to 31 December 2023.
This Strategic report of the Company for the year ended 31 December 2020
has been prepared in accordance with the requirements of Section 414A of
the Act. The purpose of this report is to provide shareholders with
sufficient information to enable them to assess the extent to which the
Directors have performed their duty to promote the success of the
Company in accordance with Section 172 of the Act.
On behalf of the Board,
Dr. N E Cross
Chairman
26 March 2021
Responsibility Statement
In preparing these financial statements for the year to 31 December
2020, the Directors of the Company, being Dr Neil Cross, Robin Archibald,
Mary Anne Cordeiro, Margaret Payn, Modwenna Rees-Mogg and Patrick Reeve,
confirm that to the best of their knowledge:
- summary financial information contained in this announcement and the
full Annual Report and Financial Statements for the year ended 31
December 2020 for the Company has been prepared in accordance with
United Kingdom Generally Accepted Accounting Practice (UK Accounting
Standards and applicable law) and give a true and fair view of the
assets, liabilities, financial position and profit or loss of the
Company; and
-the Chairman's statement and Strategic report include a fair review of
the development and performance of the business and the position of the
Company, together with a description of the principal risks and
uncertainties it faces.
We consider that the Annual Report and Financial Statements, taken as a
whole, are fair, balanced, and understandable and provide the
information necessary for shareholders to assess the Company's position,
performance, business model and strategy.
A detailed "Statement of Directors' responsibilities" is contained on
page 37 within the full audited Annual Report and Financial Statements.
On behalf of the Board,
Dr N E Cross
Chairman
26 March 2021
Income statement
Year ended 31 December Year ended 31 December
2020 2019
---------------------------------------------------------- ---- -------------------------- --------------------------
Revenue Capital Total Revenue Capital Total
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------------------------------- ------- ------- -------- ------- ------- --------
Gains on investments 3 - 1,453 1,453 - 11,170 11,170
Investment income 4 604 - 604 1,416 - 1,416
Investment management fee 5 (505) (1,516) (2,021) (529) (1,587) (2,116)
Other expenses 6 (347) - (347) (306) - (306)
------- ------- -------- ------- ------- --------
(Loss)/profit on ordinary activities before tax (248) (63) (311) 581 9,583 10,164
Tax (charge)/credit on ordinary activities 8 - - - (62) 62 -
------- ------- -------- ------- ------- --------
(Loss)/profit and total comprehensive income attributable
to shareholders (248) (63) (311) 519 9,645 10,164
------- ------- -------- ------- ------- --------
Basic and diluted (loss)/ return per share (pence)* 10 (0.22) (0.06) (0.28) 0.47 8.81 9.28
---------------------------------------------------------- ---- ------- ------- -------- ------- ------- --------
* adjusted for treasury shares
The accompanying notes form an integral part of these Financial
Statements.
The total column of this Income statement represents the profit and loss
account of the Company. The supplementary revenue and capital columns
have been prepared in accordance with The Association of Investment
Companies' Statement of Recommended Practice.
Balance sheet
31 December 2020 31 December 2019
Note GBP'000 GBP'000
------------------------------------ ---------------- ----------------
Fixed asset investments 11 65,152 57,468
Current assets
Current asset investments 13 - 2,193
Trade and other receivables 13 2,038 527
Cash and cash equivalents 11,451 32,468
---------------- ----------------
13,489 35,188
Total assets 78,641 92,656
Payables: amounts falling due within
one year
Trade and other payables less than
one year 14 (613) (634)
---------------- ----------------
Total assets less current
liabilities 78,028 92,022
---------------- ----------------
Equity attributable to equity
holders
Called-up share capital 15 1,307 1,296
Share premium 37,036 34,949
Capital redemption reserve 48 28
Unrealised capital reserve 13,595 13,708
Realised capital reserve 23,617 23,567
Other distributable reserve 2,425 18,474
---------------- ----------------
Total equity shareholders' funds 78,028 92,022
---------------- ----------------
Basic and diluted net asset value
per share (pence)* 16 69.35 82.58
* excluding treasury shares
The accompanying notes form an integral part of these Financial
Statements.
These Financial Statements were approved by the Board of Directors, and
were authorised for issue on 26 March 2021 and were signed on its behalf
by
Dr. N E Cross
Chairman
Company number: 04114310
Statement of changes in equity
Capital Unrealised Realised Other
Called-up share Share redemption capital capital distributable
capital premium reserve reserve reserve* reserve* Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------------------------------- --------------- ------- ---------- ---------- -------- ------------- --------
As at 1 January 2020 1,296 34,949 28 13,708 23,567 18,474 92,022
Return/(loss) and total comprehensive income for the
year - - - 1,233 (1,296) (248) (311)
Transfer of previously unrealised gains on disposal
of investments - - - (1,346) 1,346 - -
Purchase of shares for cancellation (20) - 20 - - (1,473) (1,473)
Issue of equity 31 2,138 - - - - 2,169
Cost of issue of equity - (51) - - - - (51)
Dividends paid - - - - - (14,328) (14,328)
As at 31 December 2020 1,307 37,036 48 13,595 23,617 2,425 78,028
----------------------------------------------------- --------------- ------- ---------- ---------- -------- ------------- --------
As at 1 January 2019 1,187 26,621 28 16,697 10,933 24,431 79,897
Return and total comprehensive income for the year - - - 1,387 8,258 519 10,164
Transfer of previously unrealised gains on disposal
of investments - - - (4,376) 4,376 - -
Purchase of shares for treasury - - - - - (2,016) (2,016)
Issue of equity 109 8,547 - - - - 8,656
Cost of issue of equity - (219) - - - - (219)
Dividends paid - - - - - (4,460) (4,460)
As at 31 December 2019 1,296 34,949 28 13,708 23,567 18,474 92,022
----------------------------------------------------- --------------- ------- ---------- ---------- -------- ------------- --------
* These reserves amount to GBP26,042,000 (2019: GBP42,041,000) which is
considered distributable.
Statement of cash flows
Year ended 31 December Year ended 31 December
2020 2019
GBP'000 GBP'000
------------------------- ------------------------ -------------------------
Cash flow from operating
activities
Loan stock income
received 511 1,360
Dividend income received 108 183
Deposit interest received 58 56
Investment management fee
paid (2,062) (2,079)
Other cash payments (344) (291)
Corporation tax paid - -
Net cash flow from
operating activities (1,729) (771)
Cash flow from investing
activities
Purchase of current asset
investments (4) -
Purchase of fixed asset
investments (9,158) (7,022)
Disposal of current asset
investments 1,616 -
Disposal of fixed asset
investments 1,936 31,142
Net cash flow from
investing activities (5,610) 24,120
Cash flow from financing
activities
Issue of share capital - 7,804
Cost of issue of equity (47) (17)
Dividends paid* (12,158) (3,794)
Purchase of own shares
(including costs) (1,473) (2,016)
Net cash flow from
financing activities (13,678) 1,977
(Decrease)/increase in
cash and cash
equivalents (21,017) 25,326
Cash and cash equivalents
at start of period 32,468 7,142
------------------------ -------------------------
Cash and cash equivalents
at end of period 11,451 32,468
*The dividends paid shown in the cash flow are different to the
dividends disclosed in note 9 as a result of the non-cash effect of the
Dividend Reinvestment Scheme.
Notes to the Financial Statements
1. Basis of preparation
The Financial Statements have been prepared in accordance with
applicable United Kingdom law and accounting standards, including
Financial Reporting Standard 102 ("FRS 102"), and with the Statement of
Recommended Practice "Financial Statements of Investment Trust Companies
and Venture Capital Trusts" ("SORP") issued by The Association of
Investment Companies ("AIC"). The Financial Statements have been
prepared on a going concern basis and further details can be found in
the Directors' report on pages 32 and 33 of the full Annual Report and
Financial Statements.
The preparation of the Financial Statements requires management to make
judgements and estimates that affect the application of policies and
reported amounts of assets, liabilities, income and expenses. The most
critical estimates and judgements relate to the determination of
carrying value of investments at fair value through profit and loss
("FVTPL") in accordance with FRS 102 sections 11 and 12. The Company
values investments by following the International Private Equity and
Venture Capital Valuation ("IPEV") Guidelines as updated in 2018 and
further detail on the valuation techniques used are outlined in note 2
below.
Company information can be found on page 2 of the full Annual Report and
Financial Statements.
2. Accounting policies
Fixed and current asset investments
The Company's business is investing in financial assets with a view to
profiting from their total return in the form of income and capital
growth. This portfolio of financial assets is managed, and its
performance evaluated on a fair value basis, in accordance with a
documented investment policy, and information about the portfolio is
provided internally on that basis to the Board.
In accordance with the requirements of FRS 102, those undertakings in
which the Company holds more than 20 per cent. of the equity as part of
an investment portfolio are not accounted for using the equity method.
In these circumstances the investment is measured at FVTPL.
Upon initial recognition (using trade date accounting) investments,
including loan stock, are classified by the Company as FVTPL and are
included at their initial fair value, which is cost (excluding expenses
incidental to the acquisition which are written off to the Income
statement).
Subsequently, the investments are valued at 'fair value', which is
measured as follows:
-- Investments listed on recognised exchanges are valued at their bid prices
at the end of the accounting period or otherwise at fair value based on
published price quotations.
-- Unquoted investments, where there is not an active market, are valued
using an appropriate valuation technique in accordance with the IPEV
Guidelines. Indicators of fair value are derived using established
methodologies including earnings multiples, revenue multiples, the level
of third party offers received, cost or prices of recent investment
rounds, net assets and industry valuation benchmarks. Where price of
recent investment is used as a starting point for estimating fair value
at subsequent measurement dates, this has been benchmarked using an
appropriate valuation technique permitted by the IPEV guidelines.
-- In situations where cost or price of recent investment is used,
consideration is given to the circumstances of the portfolio company
since that date in determining fair value. This includes consideration of
whether there is any evidence of deterioration or strong definable
evidence of an increase in value. In the absence of these indicators, the
investment in question is valued at the amount reported at the previous
reporting date. Examples of events or changes that could indicate a
diminution include:
-- the performance and/or prospects of the underlying business are
significantly below the expectations on which the investment was
based;
-- a significant adverse change either in the portfolio company's
business or in the technological, market, economic, legal or
regulatory environment in which the business operates; or
-- market conditions have deteriorated, which may be indicated by a
fall in the share prices of quoted businesses operating in the
same or related sectors.
Investments are recognised as financial assets on legal completion of
the investment contract and are de-recognised on legal completion of the
sale of an investment.
Dividend income is not recognised as part of the fair value movement of
an investment but is recognised separately as investment income through
the other distributable reserve when a share becomes ex-dividend.
Current assets and payables
Receivables (including debtors due after more than one year), payables
and cash are carried at amortised cost, in accordance with FRS 102.
Debtors due after more than one year meet the definition of a financing
transaction held at amortised cost, and interest will be recognised
through capital over the credit period using the effective interest
method. There are no financial liabilities other than payables.
Investment income
Equity income
Dividend income is included in revenue when the investment is quoted
ex-dividend.
Unquoted loan stock and other preferred income
Fixed returns on non-equity shares and debt securities are recognised
when the Company's right to receive payment and expected settlement is
established. Where interest is rolled up and/or payable at redemption
then it is recognised as income unless there is reasonable doubt as to
its receipt.
Bank interest income
Interest income is recognised on an accruals basis using the rate of
interest agreed with the bank.
Investment management fee, performance incentive fee and expenses
All expenses have been accounted for on an accruals basis. Expenses are
charged through the other distributable reserve except the following
which are charged through the realised capital reserve:
-- 75 per cent. of management fees and performance incentive fees, if any,
are allocated to the realised capital reserve. This is in line with the
Board's expectation that over the long term 75 per cent. of the Company's
investment returns will be in the form of capital gains; and
-- expenses which are incidental to the purchase or disposal of an
investment are charged through the realised capital reserve.
Taxation
Taxation is applied on a current basis in accordance with FRS 102.
Current tax is tax payable (refundable) in respect of the taxable profit
(tax loss) for the current period or past reporting periods using the
tax rates and laws that have been enacted or substantively enacted at
the financial reporting date. Taxation associated with capital expenses
is applied in accordance with the SORP.
Deferred tax is provided in full on all timing differences at the
reporting date. Timing differences are differences between taxable
profits and total comprehensive income as stated in the Financial
Statements that arise from the inclusion of income and expenses in tax
assessments in periods different from those in which they are recognised
in the Financial Statements. As a VCT the Company has an exemption from
tax on capital gains. The Company intends to continue meeting the
conditions required to obtain approval as a VCT in the foreseeable
future. The Company, therefore, should have no material deferred tax
timing differences arising in respect of the revaluation or disposal of
investments and the Company has not provided for any deferred tax.
Reserves
Called-up share capital
This reserve accounts for the nominal value of the shares.
Share premium
This reserve accounts for the difference between the price paid for the
Company's shares and the nominal value of those shares, less issue
costs.
Capital redemption reserve
This reserve accounts for amounts by which the issued share capital is
diminished through the repurchase and cancellation of the Company's own
shares.
Unrealised capital reserve
Increases and decreases in the valuation of investments held at the year
end against cost are included in this reserve.
Realised capital reserve
The following are disclosed in this reserve:
-- gains and losses compared to cost on the realisation of investments, or
permanent diminutions in value;
-- expenses, together with the related taxation effect, charged in
accordance with the above policies; and
-- dividends paid to equity holders where paid out by capital.
Other distributable reserve
The special reserve, treasury share reserve and the revenue reserve were
combined in 2012 to form a single reserve named other distributable
reserve.
This reserve accounts for movements from the revenue column of the
Income statement, the payment of dividends, the buy-back of shares and
other non-capital realised movements.
Dividends
Dividends by the Company are accounted for in the period in which the
dividend is paid or approved at the Annual General Meeting.
Segmental reporting
The Directors are of the opinion that the Company is engaged in a single
operating segment of business, being investment in smaller companies
principally based in the UK.
3. Gains/(losses) on investments
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
Unrealised gains on fixed asset
investments 1,233 1,115
Unrealised gains on current asset
investments - 272
Realised gains on fixed asset
investments 801 9,783
Realised losses on current asset
investments (581) -
1,453 11,170
----------------- -----------------
4. Investment income
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
----------------------
Loan stock interest 510 1,105
Dividend income 39 253
Bank deposit interest 55 58
604 1,416
----------------- -----------------
5. Investment management fees
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
Investment management fee charged to
revenue 505 529
Investment management fee charged to
capital 1,516 1,587
----------------- -----------------
2,021 2,116
----------------- -----------------
Further details of the Management agreement under which the investment
management fee is paid are given in the Strategic report above.
During the year, services of a total value of GBP2,021,000 (2019:
GBP2,116,000) were purchased by the Company from Albion Capital Group
LLP in respect of management fees. At the financial year end, the amount
due to Albion Capital Group LLP in respect of these services disclosed
as accruals was GBP477,000 (2019: GBP518,000). The total annual running
costs of the Company are capped at an amount equal to 2.75 per cent. of
the Company's net assets, with any excess being met by Albion Capital
Group LLP by way of a reduction in management fees. During the year, the
management fee was reduced by GBP78,000 as a result of this cap (2019:
GBP136,000).
During the year, the Company was not charged by Albion Capital Group LLP
in respect of Patrick Reeve's services as a Director (2019: nil).
Albion Capital Group LLP, its partners and staff (including Patrick
Reeve) held 1,462,348 Ordinary shares in the Company as at 31 December
2020.
Albion Capital Group LLP is, from time-to-time, eligible to receive
arrangement fees and monitoring fees from portfolio companies. During
the year ended 31 December 2020, fees of GBP237,000 attributable to the
investments of the Company were received by Albion Capital Group LLP
pursuant to these arrangements (2019: GBP241,000).
During the year, GBP4,000 (2019: GBPnil) was invested into the SVS
Albion OLIM UK Equity Income Fund ("OUEIF") as part of the Company's
management of surplus liquid funds. To avoid double charging, Albion
Capital Group LLP agreed to reduce its management fee relating to the
investment in the OUEIF by 0.75 per cent. per annum, which represents
the OUEIF management fee charged by OLIM. This resulted in a further
reduction of the management fee of GBP9,000 (2019: GBP16,000). During
the year, the Company disposed of its investment in the OUEIF. Full
details of the disposal can be found in the Portfolio of investments on
page 26 of the full Annual Report and Financial Statements.
6. Other expenses
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
Directors' fees (including NIC) 119 108
Auditor's remuneration for statutory audit services
(excluding VAT) 34 31
Tax services 19 23
Other administrative expenses 175 144
347 306
----------------- -----------------
7. Directors' fees
The amounts paid to and on behalf of the Directors during the year are
as follows:
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
Directors' fees 110 100
National insurance 9 8
----------------- -----------------
119 108
----------------- -----------------
The Company's key management personnel are the non-executive Directors.
Further information regarding Directors' remuneration can be found in
the Directors' remuneration report on pages 43 to 45 of the full Annual
Report and Financial Statements.
8. Tax on ordinary activities
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
- -
UK corporation tax charge payable
----------------- -----------------
Factors affecting the tax charge:
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
(Loss)/return on ordinary activities before taxation (311) 10,164
----------------- -----------------
Tax charge on (loss)/profit at the average companies
rate of 19% (2019: 19%) (59) 1,931
Factors affecting the charge:
Non-taxable gains (276) (2,122)
Income not taxable (7) (48)
Excess management expenses carried forward 342 239
- -
----------------- -----------------
The tax charge for the year shown in the Income statement is lower than
the average companies rate of corporation tax in the UK of 19 per cent.
(2019: 19 per cent.). The differences are explained above.
Notes
(i) Venture Capital Trusts are not subject to corporation tax
on capital gains.
(ii) Tax relief on expenses charged to capital has been
determined by allocating tax relief to expenses by reference to the
applicable corporation tax rate and allocating the relief between
revenue and capital in accordance with the SORP.
(iii) The Company has excess management expenses of
GBP5,407,000 (2019: GBP3,606,000) that are available for offset against
future profits. A deferred tax asset of GBP1,027,000 (2019: GBP613,000)
has not been recognised in respect of these losses as they will be
recoverable only to the extent that the Company has sufficient future
taxable profits.
9. Dividends
Year ended Year ended
31 December 2020 31 December 2019
GBP'000 GBP'000
-------------------------------------------------------
Dividend of 2.00p per share paid on 28 June 2019 - 2,237
Dividend of 2.00p per share paid on 31 December 2019 - 2,223
Dividend of 2.00p per share paid on 30 June 2020 2,201 -
Special dividend of 9.00p per share paid on 30 October
2020 9,942 -
Dividend of 1.95p per share paid on 31 December 2020 2,185 -
14,328 4,460
----------------- -----------------
In addition to the dividends summarised above, the Board has declared a
first dividend for the year ending 31 December 2021 of 1.73 pence per
share. The dividend will be paid on 30 June 2021 to shareholders on the
register on 4 June 2021. The total dividend will be approximately
GBP2,312,000. All dividends are paid out of the other distributable
reserve as shown in the Balance sheet.
10. Basic and diluted (loss)/return per share
Year ended 31 Year ended 31 December
December 2020 2019
Revenue Capital Total Revenue Capital Total
--------------------------------------------------------
(Loss)/profit attributable to equity shares (GBP'000) (248) (63) (311) 519 9,645 10,164
Weighted average shares in issue (adjusted for treasury
shares) 110,981,864 109,562,226
(Loss)/return attributable per equity share (pence) (0.22) (0.06) (0.28) 0.47 8.81 9.28
The weighted average number of shares is calculated adjusted for
treasury shares of 18,196,470 (2019: 18,196,470).
There are no convertible instruments, derivatives or contingent share
agreements in issue, and therefore no dilution affecting the
return/(loss) per share. The basic return/(loss) per share is therefore
the same as the diluted return/(loss) per share.
11. Fixed asset investments
Investments held at fair value through 31 December 2020 31 December 2019
profit or loss GBP'000 GBP'000
------------------------------------------
Unquoted equity and preference shares 45,891 40,332
Quoted equity - 135
Unquoted loan stock 19,261 17,001
65,152 57,468
---------------- ----------------
31 December 2020 31 December 2019
GBP'000 GBP'000
----------------------------------------------------
Opening valuation 57,468 70,737
Purchases at cost 10,375 8,043
Disposal proceeds (4,724) (31,956)
Realised gains 801 9,783
Movement in loan stock accrued income (1) (255)
Unrealised gains 1,233 1,115
---------------- ----------------
Closing valuation 65,152 57,468
---------------- ----------------
Movement in loan stock accrued income
Opening accumulated loan stock accrued income 88 343
Movement in loan stock accrued income (1) (255)
---------------- ----------------
Closing accumulated loan stock accrued income 87 88
---------------- ----------------
Movement in unrealised gains
Opening accumulated unrealised gains 13,727 16,988
Transfer of previously unrealised gains to realised
reserve on disposal of investments (1,413) (4,376)
Movement in unrealised gains 1,233 1,115
---------------- ----------------
Closing accumulated unrealised gains 13,547 13,727
---------------- ----------------
Historic cost basis
Opening book cost 43,653 53,406
Purchases at cost 10,375 8,043
Sales at cost (2,510) (17,796)
Closing book cost 51,518 43,653
---------------- ----------------
Purchases and disposals detailed above do not agree to the Statement of
cash flows due to restructuring of investments, conversion of
convertible loan stock and settlement receivables and payables.
The Company does not hold any assets as the result of the enforcement of
security during the period and believes that the carrying values for
both those valued below cost and past due assets are covered by the
value of security held for these loan stock investments.
Unquoted fixed asset investments are valued at fair value in accordance
with the IPEV guidelines as follows:
31 December 2020 31 December 2019
Valuation methodology GBP'000 GBP'000
--------------------------------------------------
Cost and price of recent investment (reviewed for
impairment or uplift) 30,244 32,087
Revenue multiple 12,507 1,845
Third party valuation -- discounted cash flow 10,937 11,113
Third party valuation -- earnings multiple 5,955 4,729
Net assets 2,869 5,487
Earnings multiple 1,962 2,072
Discounted offer price 678 -
65,152 57,333
---------------- ----------------
When using the cost or price of a recent investment in the valuations,
the Company looks to re-calibrate this price at each valuation point by
reviewing progress within the investment, comparing against the initial
investment thesis, assessing if there are any significant events or
milestones that would indicate the value of the investment has changed
and considering whether a market-based methodology (i.e. using multiples
from comparable public companies) or a discounted cashflow forecast
would be more appropriate.
The main inputs into the calibration exercise, and for the valuation
models using multiples, are revenue, EBITDA and P/E multiples (based on
the most recent revenue, EBITDA or earnings achieved and equivalent
corresponding revenue, EBITDA or earnings multiples of comparable
companies), quality of earnings assessments and comparability difference
adjustments. Revenue multiples are often used, rather than EBITDA or
earnings, due to the nature of the Company's investments, being in
growth and technology companies which are not normally expected to
achieve profitability or scale for a number of years. Where an
investment has achieved scale and profitability the Company would
normally then expect to switch to using an EBITDA or earnings multiple
methodology.
In the calibration exercise and in determining the valuation for the
Company's equity instruments, comparable trading multiples are used. In
accordance with the Company's policy, appropriate comparable companies
based on industry, size, developmental stage, revenue generation and
strategy are determined and a trading multiple for each comparable
company identified is then calculated. The multiple is calculated by
dividing the enterprise value of the comparable group by its revenue,
EBITDA or earnings. The trading multiple is then adjusted for
considerations such as illiquidity, marketability and other differences,
advantages and disadvantages between the portfolio company and the
comparable public companies based on company specific facts and
circumstances.
Fair value investments had the following movements between valuation
methodologies:
Change in valuation 31 December 2020 Explanatory note
methodology (2019 to 2020) GBP'000
----------------------------
Price of recent investment to 9,711 More appropriate valuation
revenue multiple methodology
Net assets to third party 1,396 Third party valuation
valuation - earnings undertaken
multiple
Price of recent investment to 678 Third party offer received
discounted offer price
Cost and Price of recent 305 Covid-19 impact on portfolio
investment to net assets company has led to
revaluation
Bid price to net assets 135 Company delisted and in
liquidation
Revenue multiple to net 5 Covid-19 impact on portfolio
assets company has led to
revaluation
The valuation will be the most appropriate valuation methodology for an
investment within its market, with regard to the financial health of the
investment and the IPEV Guidelines. The Directors believe that, within
these parameters, there are no other more relevant methods of valuation
which would be reasonable as at 31 December 2020.
FRS 102 and the SORP requires the Company to disclose the inputs to the
valuation methods applied to its investments measured at FVTPL in a fair
value hierarchy. The table below sets out fair value hierarchy
definitions using FRS102 s.11.27.
Fair value hierarchy Definition
-------------------- ----------------------------------------------------
Level 1 Unadjusted quoted prices in an active market
-------------------- ----------------------------------------------------
Level 2 Inputs to valuations are from observable sources and
are directly or indirectly derived from prices
-------------------- ----------------------------------------------------
Level 3 Inputs to valuations not based on observable market
data
-------------------- ----------------------------------------------------
Quoted investments are valued according to Level 1 valuation methods.
Unquoted equity, preference shares and loan stock are all valued
according to Level 3 valuation methods.
Investments held at fair value through profit or loss (Level 3) had the
following movements:
31 December 2020 31 December 2019
GBP'000 GBP'000
-------------------------------------- ---------------- ----------------
Opening balance 57,333 69,938
Purchases at cost* 10,510 8,043
Disposals proceeds (4,724) (31,917)
Movement in loan stock accrued income (1) (255)
Realised gains 801 10,409
Unrealised gains 1,233 1,115
---------------- ----------------
Closing balance 65,152 57,333
---------------- ----------------
*Additions do not agree to the cash flow due to GBP1,487,000 of loan
stock conversions and non-cash consideration, and GBP135,000 of delisted
investments in the year.
FRS 102 requires the Directors to consider the impact of changing one or
more of the inputs used as part of the valuation process to reasonable
possible alternative assumptions. 69 per cent. of the portfolio of
investments, consisting of equity and loan stock, is based on recent
investment price, discounted offer price, net assets and cost, and as
such the Board believe that changes to reasonable possible alternative
input assumptions (by adjusting the earnings and revenue multiples) for
the valuation of the remainder of the portfolio could lead to a
significant change in the fair value of the portfolio. Therefore, for
the remainder of the portfolio, the Board has adjusted the inputs for a
number of the largest portfolio companies (by value) resulting in a
total coverage of 86 per cent. of the portfolio of investments. The main
inputs considered for each type of valuation is as follows:
Change in
fair value
Change of Change in NAV
Valuation Portfolio company Base in investments (pence per
technique sector Input Case* input (GBP'000) share)
----------- ------------------- --------- ----- ------ ----------- -----------------
Revenue Software and other Revenue
multiple technology multiple 5.4x +0.5 226 0.20
----------- ------------------- --------- ----- ------ ----------- -----------------
-0.5 (226) (0.20)
----------------------------------------- ----- ------ ----------- -----------------
Healthcare
Revenue (including digital Revenue
multiple healthcare) multiple 4.5x +0.5 381 0.34
----------- ------------------- --------- ----- ------ ----------- -----------------
-0.5 (381) (0.34)
----------------------------------------- ----- ------ ----------- -----------------
Third party
valuation
--
discounted Discount
cash flow Renewable energy rate 5.75% +0.5% (245) (0.22)
----------- ------------------- --------- ----- ------ ----------- -----------------
-0.5% 270 0.24
----------------------------------------- ----- ------ ----------- -----------------
Third party
valuation
--
earnings Earnings
multiple Education multiple 11x +1.0 149 0.13
----------- ------------------- --------- ----- ------ ----------- -----------------
-1.0 (149) (0.13)
----------------------------------------- ----- ------ ----------- -----------------
* As detailed in the accounting policies above, the base case is based
on market comparables, discounted where appropriate for marketability,
in accordance with the IPEV guidelines.
The impact of these changes could result in an overall increase in the
valuation of the equity investments by GBP1,026,000 (2.2%) or a decrease
in the valuation of equity investments by GBP1,001,000 (2.2%).
12. Significant interests
The principal activity of the Company is to select and hold a portfolio
of investments. Although the Company, through the Manager, will, in some
cases, be represented on the Board of the portfolio company, it will not
take a controlling interest or become involved in the management. The
size and structure of the companies with unquoted securities may result
in certain holdings in the portfolio representing a participating
interest without there being any partnership, joint venture or
management consortium agreement. The investments listed below are held
as part of an investment portfolio and therefore, as permitted by FRS
102 section 14.4B, they are measured at FVTPL and not accounted for
using the equity method.
The Company has interests of greater than 20 per cent. of the nominal
value of any class of the allotted shares in the portfolio companies as
at 31 December 2020 as described below:
% total
Registered Profit/(loss) before tax Net assets/(liabilities) % class and voting
Company postcode GBP'000 GBP'000 Result for year ended share type rights
------------ ------------ ------------------------ ------------------------ ----------------------- -------------- -------
Albion
Investment
Properties 31.8% A
Limited EC1M 5QL, UK n/a* (706) 31 December 2019 Ordinary 31.8%
MHS 1
Limited EC1M 5QL, UK (1,086) (8,965) 31 August 2020 22.5% Ordinary 22.5%
memsstar 67.3% A
Limited EH3 9EP, UK 644 2,577 31 December 2019 Ordinary 30.1%
Premier
Leisure
(Suffolk)
Limited EC1M 5QL, UK n/a* (1,506) 31 August 2020 25.8% Ordinary 25.8%
The Q Garden
Company 33.4% A
Limited EC1M 5QL, UK n/a* (4,595) 31 August 2020 Ordinary 33.4%
*The company files filleted accounts which does not disclose this
information.
13. Current assets
Current asset investments 31 December 2020 31 December 2019
GBP'000 GBP'000
-------------------------------------- ---------------- ----------------
SVS Albion OLIM UK Equity Income Fund - 2,193
---------------- ----------------
Current asset investments at 31 December 2019 consisted of cash invested
in SVS Albion OLIM UK Equity Income Fund and was capable of realisation
within 7 days. These fell into the level 1 fair value hierarchy as
defined in note 11. The Company disposed of its investment in the SVS
Albion OLIM UK Equity Income Fund. Further details can be found in the
Portfolio of investments section on page 26 of the full Annual Report
and Financial Statements.
Trade and other receivables 31 December 2020 31 December 2019
GBP'000 GBP'000
-------------------------------------- ---------------- ----------------
Prepayments and accrued income 25 22
Other receivables 1 73
Deferred consideration under one year 111 432
Deferred consideration over one year 1,901 -
2,038 527
---------------- ----------------
The deferred consideration over one year relates to the sale of
G.Network Communications Limited in December 2020. These proceeds are
receivable in January 2024, and have been discounted to present value at
the prevailing market rate, including a provision for counterparty risk.
This constitutes a financing transaction and has been accounted for
using the policy disclosed in note 2.
The Directors consider that the carrying amount of receivables is not
materially different to their fair value.
14. Payables: amounts falling due within one year
31 December 2020 31 December 2019
GBP'000 GBP'000
----------------------------- ----------------- ----------------
Trade payables 33 15
Accruals and deferred income 580 619
613 634
----------------- ----------------
The Directors consider that the carrying amount of payables is not
materially different to their fair value.
15. Called-up share capital
Allotted, called-up and fully paid GBP'000
-------------------------------------------------------- -------
129,624,437 Ordinary shares of 1 penny each at 31
December 2019 1,296
3,117,737 Ordinary shares of 1 penny each issued during
the year 31
2,031,283 Ordinary shares of 1 penny each cancelled
during the year (20)
-------------------------------------------------------- -------
130,710,891 Ordinary shares of 1 penny each at 31
December 2020 1,307
-------------------------------------------------------- -------
18,196,470 Ordinary shares of 1 penny each held in
treasury at 31 December 2019 (182)
18,196,470 Ordinary shares of 1 penny each held in
treasury at 31 December 2020 (182)
-------------------------------------------------------- -------
Voting rights of 112,514,421 Ordinary shares of 1
penny each at 31 December 2020 1,125
-------------------------------------------------------- -------
The Company purchased 2,031,283 Ordinary shares to be cancelled (2019:
2,678,000 to be held in treasury) at a cost of GBP1,473,000 including
stamp duty (2019: GBP2,016,000) during the year ended 31 December 2020.
Total share buy backs in 2020 represents 1.6 per cent. (2019: 2.1 per
cent.) of called-up share capital.
The Company holds a total of 18,196,470 shares (2019: 18,196,470) in
treasury representing 13.9 per cent. (2019: 14.0 per cent.) of the
issued Ordinary share capital at 31 December 2020.
Under the terms of the Dividend Reinvestment Scheme, the following new
Ordinary shares of nominal value 1 penny each were allotted during the
year:
Number of Issue price Net
Date of shares Aggregate nominal value of shares (pence per invested Opening market price on allotment date (pence per
allotment allotted (GBP'000) share) (GBP'000) share)
----------
30 June
2020 421,235 4 75.37 302 72.00
30 October
2020 2,197,279 22 68.85 1,495 65.50
31
December
2020 499,223 5 67.80 321 64.50
3,117,737 31 2,118
--------- --------------------------------- ---------
16. Basic and diluted net asset value per share
31 December 2020 31 December 2019
(pence per share) (pence per share)
--------------------------------------- ----------------- ------------------
Basic and diluted net asset value per
share 69.35 82.58
----------------- ------------------
The basic and diluted net asset value per share at the year end is
calculated in accordance with the Articles of Association and is based
upon total shares in issue (less treasury shares) of 112,514,421 at 31
December 2020 (2019: 111,427,967).
17. Capital and financial instruments risk management
The Company's capital comprises Ordinary shares as described in note 15.
The Company is permitted to buy back its own shares for cancellation or
treasury purposes, and this is described in more detail above in the
Chairman's statement.
The Company's financial instruments comprise equity and loan stock
investments in quoted and unquoted companies, cash balances, receivables
and payables which arise from its operations. The main purpose of these
financial instruments is to generate cash flow and revenue and capital
appreciation for the Company's operations. The Company has no gearing or
other financial liabilities apart from short term payables. The Company
does not use any derivatives for the management of its Balance sheet.
The principal financial risks arising from the Company's operations are:
-- investment (or market) risk (which comprises investment price and cash
flow interest rate risk);
-- credit risk; and
-- liquidity risk.
The Board regularly reviews and agrees policies for managing each of
these risks. There have been no changes in the nature of the risks that
the Company has faced during the past year, and apart from where noted
below, there have been no changes in the objectives, policies or
processes for managing risks during the past year. The key risks are
summarised below.
Investment risk
As a Venture Capital Trust, it is the Company's specific nature to
evaluate and control the investment risk of its portfolio in quoted and
unquoted investments, details of which are shown pages 24 to 26 of the
full Annual Report and Financial Statements. Investment risk is the
exposure of the Company to the revaluation and devaluation of
investments. The main driver of investment risk is the operational and
financial performance of the portfolio company and the dynamics of
market quoted comparators. The Manager receives management accounts from
portfolio companies, and members of the investment management team often
sit on the boards of unquoted portfolio companies; this enables the
close identification, monitoring and management of investment risk.
The Manager and the Board formally review investment risk (which
includes market price risk), both at the time of initial investment and
at quarterly Board meetings.
The Board monitors the prices at which sales of investments are made to
ensure that profits to the Company are maximised, and that valuations of
investments retained within the portfolio appear sufficiently prudent
and realistic compared to prices being achieved in the market for sales
of quoted and unquoted investments.
The maximum investment risk as at the Balance sheet date is the value of
the fixed asset investment portfolio which is GBP65,152,000 (2019: fixed
and current asset investments: GBP59,661,000). Fixed asset investments
form 83 per cent. of the net asset value as at 31 December 2020 (2019:
fixed and current asset investments: 65 per cent.).
More details regarding the classification of fixed and current asset
investments are shown in notes 11 and 13.
Investment price risk
Investment price risk is the risk that the fair value of future
investment cash flows will fluctuate due to factors specific to an
investment instrument or to a market in similar instruments. As a
Venture Capital Trust, the Company invests in accordance with the
investment policy set out above. The management of risk within the
venture capital portfolio is addressed through careful investment
selection, by diversification across different industry segments, by
maintaining a wide spread of holdings in terms of financing stage and by
limitation of the size of individual holdings. The Directors monitor the
Manager's compliance with the investment policy, review and agree
policies for managing this risk and monitor the overall level of risk on
the investment portfolio on a regular basis.
Valuations are based on the most appropriate valuation methodology for
an investment within its market, with regard to the financial health of
the investment and the IPEV Guidelines. Details of the industries in
which investments have been made are contained in the Portfolio of
investments section on pages 24 to 26 of the full Annual Report and
Financial Statements and in the Strategic report.
As required under FRS 102 the Board is required to illustrate by way of
a sensitivity analysis the extent to which the assets are exposed to
market risk. The Board considers that the value of the fixed asset
investment portfolio is sensitive to a change of 10% based on the
current economic climate. The impact of a 10% change has been selected
as this is considered reasonable given the current level of volatility
observed. When considering the appropriate level of sensitivity to be
applied, the Board has considered both historic performance and future
expectations.
The sensitivity of a 10% increase or decrease in the valuation of the
fixed asset investment portfolio (keeping all other variables constant)
would increase or decrease the net asset value and return for the year
by GBP6,515,000. Further sensitivity analysis on fixed asset investments
is included in note 11.
Interest rate risk
The Company is exposed to fixed and floating rate interest rate risk on
its financial assets. On the basis of the Company's analysis, it was
estimated that a rise of half a percentage point in all interest rates
would have decreased the loss before tax for the year by approximately
GBP116,000 (2019: GBP147,000). Furthermore, it was considered that a
fall of interest rates below current levels during the year would have
been very unlikely.
The weighted average effective interest rate applied to the Company's
unquoted loan stock during the year was approximately 3.2 per cent.
(2019: 4.6 per cent.). The weighted average period to maturity for the
unquoted loan stock is approximately 3.9 years (2019: 3.9 years).
The Company's financial assets and liabilities, all denominated in
pounds sterling, consist of the following:
31 December 2020 31 December 2019
Floating rate Non-interest bearing Total Floating rate Non-interest bearing Total
Fixed rate GBP'000 GBP'000 GBP'000 GBP'000 Fixed rate GBP'000 GBP'000 GBP'000 GBP'000
------------------
Unquoted equity - - 45,891 45,891 - - 40,332 40,332
Quoted equity - - - - - - 135 135
Unquoted loan
stock 18,297 - 964 19,261 15,939 - 1,062 17,001
Current asset
investments - - - - - - 2,193 2,193
Receivables* - - 2,013 2,013 - - 509 509
Current
liabilities - - (613) (613) - - (634) (634)
Cash - 11,451 - 11,451 - 32,468 - 32,468
------------------- ------------- -------------------- -------- -------------------- ------------- -------------------- --------
Total 18,297 11,451 48,255 78,003 15,939 32,468 43,597 92,004
------------------- ------------- -------------------- -------- -------------------- ------------- -------------------- --------
*The receivables do not reconcile to the Balance sheet as prepayments
are not included in the above table.
Credit risk
Credit risk is the risk that the counterparty to a financial instrument
will fail to discharge an obligation or commitment that it has entered
into with the Company. The Company is exposed to credit risk through its
receivables, investment in unquoted loan stock, and through the holding
of cash on deposit with banks.
The Manager evaluates credit risk on loan stock prior to investment, and
as part of its ongoing monitoring of investments. In doing this, it
takes into account the extent and quality of any security held. For loan
stock investments made prior to 6 April 2018, which account for 62.8 per
cent. of loan stock value, typically loan stock instruments will have a
fixed or floating charge, which may or may not be subordinated, over the
assets of the portfolio company in order to mitigate the gross credit
risk.
The Manager receives management accounts from portfolio companies, and
members of the investment management team sit on the boards of unquoted
portfolio companies; this enables the close identification, monitoring
and management of investment specific credit risk.
The Manager and the Board formally review credit risk (including
receivables) and other risks, both at the time of initial investment and
at quarterly Board meetings.
The Company's total gross credit risk as at 31 December 2020 was limited
to GBP19,261,000 (2019: GBP17,001,000) of unquoted loan stock
instruments, GBP11,451,000 (2019: GBP32,468,000) cash deposits with
banks and GBP2,038,000 (2019: GBP527,000) of other receivables.
At the Balance sheet date, the cash held by the Company was held with
Lloyds Bank plc, Scottish Widows Bank plc (part of Lloyds Banking Group),
Barclays Bank plc and National Westminster Bank plc. Credit risk on cash
transactions was mitigated by transacting with counterparties that are
regulated entities subject to prudential supervision, with high credit
ratings assigned by international credit-rating agencies.
The Company has an informal policy of limiting counterparty banking and
floating rate note exposure to a maximum of 20 per cent. of net asset
value for any one counterparty.
The credit profile of unquoted loan stock is described under liquidity
risk below.
Liquidity risk
Liquid assets are held as cash on current account, on deposit, in bonds
or short term money market account. Under the terms of its Articles, the
Company has the ability to borrow up to 10 per cent. of its adjusted
capital and reserves of the latest published audited Balance sheet,
which amounts to GBP7,572,000 as at 31 December 2020 (2019:
GBP8,979,000).
The Company has no committed borrowing facilities as at 31 December 2020
(2019: GBPnil). The Company had cash balances of GBP11,451,000 (2019:
GBP32,468,000) and no current asset investments (2019: GBP2,193,000),
which are considered to be readily realisable within the timescales
required to make cash available for investment. The main cash outflows
are for new investments, share buy-backs and dividend payments, which
are within the control of the Company. The Manager formally reviews the
cash requirements of the Company on a monthly basis, and the Board on a
quarterly basis as part of its review of management accounts and
forecasts. All the Company's financial liabilities are short term in
nature and total GBP613,000 as at 31 December 2020 (2019: GBP634,000).
The carrying value of loan stock investments analysed by expected
maturity dates is as follows:
31 December 2020 31 December 2019
Redemption Fully performing Valued below cost Past due Total Fully performing Valued below cost Past due Total
date GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-----------
Less than
one year 2,266 2,341 1,673 6,280 2,438 4,427 732 7,597
1-2 years 2,036 26 79 2,141 595 76 - 671
2-3 years 195 92 - 287 1,900 26 - 1,926
3-5 years 7,012 - 65 7,077 2,964 156 - 3,120
5+ years 3,097 - 379 3,476 3,264 - 423 3,687
---------------- ----------------- -------- -------- ---------------- ----------------- -------- --------
Total 14,606 2,459 2,196 19,261 11,161 4,685 1,155 17,001
---------------- ----------------- -------- -------- ---------------- ----------------- -------- --------
Loan stock can be past due as a result of interest or capital not being
paid in accordance with contractual terms.
The cost of loan stock investments valued below cost is GBP3,033,000
(2019: GBP5,409,000).
In view of the factors identified above, the Board considers that the
Company is subject to low liquidity risk.
Fair values of financial assets and financial liabilities
All the Company's financial assets and liabilities as at 31 December
2020 are stated at fair value as determined by the Directors, with the
exception of receivables (including debtors due after more than one
year), payables and cash which are carried at amortised cost, in
accordance with FRS 102. There are no financial liabilities other than
payables. The Company's financial liabilities are all non-interest
bearing. It is the Directors' opinion that the book value of the
financial liabilities is not materially different to the fair value and
all are payable within one year.
18. Commitments and contingencies
The Company had no financial commitments in respect of investments as at
31 December 2020 (2019: nil).
There were no contingent liabilities or guarantees given by the Company
as at 31 December 2020 (2019: nil).
19. Post balance sheet events
Since 31 December 2020 the Company has had the following post balance
sheet events:
-- Investment of GBP1,014,000 in a new portfolio company, Threadneedle
Software Holding Limited (T/A Solidatus);
-- Disposal of OmPrompt Holdings Limited for proceeds of GBP678,000;
-- Disposal of SBD Automotive Limited for proceeds of GBP567,000; and
-- Investment of GBP418,000 in an existing portfolio company, Healios
Limited.
Since 31 December 2020, the Company issued the following new Ordinary
shares of nominal value 1 penny each under the Albion VCTs' Prospectus
Top Up Offers 2020/21:
Number of
shares Aggregate nominal value of shares Issue price Net consideration received Opening market price on allotment date
Date of allotment allotted (GBP'000) (pence per share) (GBP'000) (pence per share)
-------------------
26 February 2021 2,059,020 21 70.30 1,426 66.00
26 February 2021 520,699 5 70.70 361 66.00
26 February 2021 18,541,660 185 71.70 12,854 66.00
21,121,379 211 14,641
---------- --------------------------------- --------------------------
20. Related party transactions
The Company has entered into an offer agreement relating to the Top Up
Offers 2020/21 with the Company's Manager, Albion Capital Group LLP
("Albion"), pursuant to which Albion will receive a fee of 2.5 per cent.
of the gross proceeds of the Offer and out of which Albion will pay the
costs of the Offer, as detailed in the Prospectus.
Other than transactions with the Manager as disclosed in note 5, the
Directors' remuneration disclosed in the Directors' remuneration report
on pages 43 to 45 of the full Annual Report and Financial Statements,
and that disclosed above, there are no other related party transactions
requiring disclosure.
21. Other Information
The information set out in this announcement does not constitute the
Company's statutory accounts within the terms of Section 434 of the
Companies Act 2006 for the years ended 31 December 2020 and 31 December
2019, and is derived from the statutory accounts for those financial
years, which have been, or in the case of the accounts for the year
ended 31 December 2020, which will be, delivered to the Registrar of
Companies. The Auditor reported on those accounts; the reports were
unqualified and did not contain a statement under Section 498 (2) or (3)
of the Companies Act 2006.
22. Publication
The full audited Annual Report and Financial Statements are being sent
to shareholders and copies will be made available to the public at the
registered office of the Company, Companies House, the National Storage
Mechanism and also electronically at
https://www.globenewswire.com/Tracker?data=PVnDoECJEFxyrV2mKasD0zjDbT_f4aKewzt2Ro_oSQSeICGdm5XgMVBgK0mfYB8eDDKotrUD9j2al5qAK8rd98vWK3tkX440iaOEjlTIWSL-_T5qD3g397eHf9Et-C19
www.albion.capital/funds/AATG, where the Report can be accessed as a PDF
document via a link in the 'Financial Reports and Circulars' section.
Attachment
-- Split of Portfolio by sector, stage of investment and number of employees
https://ml-eu.globenewswire.com/Resource/Download/0e02add3-2591-489f-a5cd-c56dc6f05bc5
(END) Dow Jones Newswires
March 26, 2021 13:08 ET (17:08 GMT)
Copyright (c) 2021 Dow Jones & Company, Inc.
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