TIDMOTT
21 May 2019
Oxford Technology 3 VCT plc ("the Company" or "OT3")
Annual Report and Accounts for the year ended 28 February 2019
The Directors are pleased to announce the audited results of the Company
for the year ended 28 February 2019. A copy of the Annual Report and
Accounts (together the "Accounts") will be made available to
Shareholders shortly. Set out below are extracts from the audited
Accounts. References to page numbers below are to those Accounts.
The AGM will be held at Magdalen Centre, Oxford Science Park, Oxford OX4
4GA on Wednesday 3 July 2019, at 2pm.
A copy of the Annual Report and Accounts will be available from the
registered office of the Company at Magdalen Centre, Oxford Science Park,
Oxford OX4 4GA, as well as on the Company's website:
https://www.globenewswire.com/Tracker?data=plko3QnRcC_u_j9eU6hmWCsgP010tCJ-ewzPvQCilRJkhcHmaAMsCM-a_Q6A0RGQa4x-_VIZIrlkzzGWchDERDbgm5jMRR5KN1tqxKBNMZ3iHlr932L9ClXMqsEEhiU6Ia-UIr8XgQWhpapIHFvO8A==
www.oxfordtechnologyvct.com/vct3.html
Financial Headlines
Year Ended Year Ended
28 February 2019 28 February 2018
------------------ -----------------
Net Assets at Year End GBP6.07m GBP5.85m
Net Asset Value per Share 89.5p 86.2p
Cumulative Dividend per Share 36.0p 36.0p
NAV + Cumulative Dividend 125.5p 122.2p
paid per Share from Incorporation
Share Price at Year End 62.5p 52.5p
Earnings per Share
(Basic & Diluted) 3.3p 7.7p
-----------------
Chairman's Statement
I am pleased to present my Annual Report for the year to 28 February
2019 to fellow shareholders.
Overview
Your company made a profit of 3.3p per share primarily due to unrealised
gains in Ixaris and ImmBio offset by unrealised losses in Scancell.
Your Company continues to have adequate liquidity and your Board wishes
to retain some cash flexibility for potential follow-on investments to
enhance investee values. Your Board is not recommending the payment of a
final dividend for the year ending 28 February 2019.
Portfolio Review
The net asset value (NAV) per share on 28 February 2019 was 89.5p
compared to 86.2p on 28 February 2018. Dividends paid to date are 36.0p
per share, giving a total return to date of 125.5p per share based on
the NAV on 28 February 2019. The total return still remains just below
the performance fee threshold.
The main change in the portfolio was an increase in the valuation of
Ixaris by GBP414k as its payment systems subsidiary continued to have
accelerating sales, more than offsetting the closure of the one-time
card subsidiary Entropay, which had been very profitable but was
unviable as VISA regulations changed. Ixaris now represents 67% of our
portfolio.
ImmBio (more formally known as Immunobiology) is our second largest
holding. We invested GBP30k in August 2018 to support continued
commercialisation of its PnuBioVax Vaccine strains. Negotiations have
continued to progress and a first commercial licence has now been signed
with China National Biotech Group. This is a significant third party
validation of the heat shock protein mediated vaccine approach pioneered
by the company and has led to a significant uplift in valuation of
GBP253k.
Arecor raised GBP6m in a fundraising round led by 3 larger VCTs for
clinical development of its diabetes speciality pharmaceutical
portfolio. Your company invested GBP219k in this round making Arecor the
third largest investment in the portfolio. Arecor has used the
investment to strengthen its management team with the appointment of a
Chief Financial Officer as well as to progress its portfolio into the
clinic. A Phase 1 Clinical Trial Application ("CTA") for product
candidate AT247 has been approved by the Austrian Federal Office for
Safety in Health Care. The double-blind, randomised, three-way cross
over study will compare the pharmacokinetic and pharmacodynamic profiles
of AT247 to current best in class insulin treatments. The trial is being
conducted in Austria at an internationally recognised centre of
excellence in the field of diabetes research.
Scancell Holdings Plc (Scancell), listed on the AIM market of the London
Stock Exchange, is now your Company's fourth largest holding following a
marked decline in share price during the year. Scancell has had some
mixed news flow during the course of the reporting period. Approval of
the SCIB1 Phase 2 melanoma combination trial in the US was delayed due
to FDA questions over the Mark 2 version of the third party Trigrid
applicator. On a more positive note, post year end, UK approval of this
trial has now been received.
The partnerships with the likes of Cancer Research UK (CRUK) and
BioNTech continues. Scancell were shortlisted but were not a winner of
the CRUK Grand Challenge. However, the relationships with larger
players who supported Lindy Durrant's technical leadership will
hopefully bear fruit in the future. The first clinical trial of Moditope
will start in early 2020 addressing 3 different types of cancer. The
management team has been strengthened with 2 new senior appointments.
In May 2019, Scancell announced encouraging progress in the Cancer
Research UK SCIB2 pre-clinical studies enabling liposomal nanoparticles
to be used as a delivery system as an alternative to the SCIB1
electroporation method. CRUK is now planning a clinical trial to test
efficacy and safety of SCIB-2.
An GBP8.7m placing and open offer at 12p per share was successful albeit
at a 31.2% discount. Unfortunately, one of the new institutional
investors (owning 5%) brought in to strengthen the register got into
difficulties and started to offload its Scancell holding at distressed
prices. Scancell is using the proceeds of the placing and open offer to
support clinical trials for SCIB1, SCIB2 and Modi-1 and pre-clinical
work for Modi-2. OT3 was unable to participate in the placing at this
price due to the 15% VCT rule. As a result, our holding has become
further diluted. The bid price of Scancell's shares used for the
calculation of the Company's net asset value on 28 February 2019 was
7.0p, half the 14.0p, at the end of the previous reporting year.
Unfortunately, the share price has fallen further since year end and is
currently just above 4p.
As a result of the above events the portfolio has become highly
concentrated with Ixaris, Immbio and Arecor making up just over 80% of
OT3's portfolio as at 28 February 2019. The fund's holding in Abzena was
realised as a result of a takeover generating proceeds of GBP32k. Your
Company also invested GBP83k in Orthogem.
The government has recently raised concerns that female entrepreneurs
and founders are struggling to raise capital. We are delighted that
Scancell, founded by international prize winner Lindy Durrant, and
Arecor led by MD Sarah Howell, have long been supported by your VCT and
successfully raised money this year.
Whilst the valuations of several companies within the portfolio have not
shown growth, some have made significant commercial progress during the
reporting period. We are hopeful that this progress will be reflected in
improving valuations in the future. Your VCT has access to sufficient
funds to be able to support portfolio companies as they raise money in
the future at hopefully enhanced valuations, provided the VCT rules will
allow OT3 to continue to invest. The Directors currently do not
envisage any early exits.
Further details are contained within the Investment Manager's Report,
and on our website.
Dividends/Return of Capital
The Directors are not recommending a final dividend for the year ending
28 February 2019. The ongoing strategy is to seek to crystallise value
from the portfolio and distribute cash to shareholders when exits allow.
VCT Market Changes
After some bigger changes in previous years the regulatory landscape
remained broadly unchanged during the period following the Patient
Capital Review (PCR) in the autumn of 2017. Post PCR we have noticed an
increase in VCT activity in the venture and growth sectors which we
believe is a good thing. In fact, the move away from secondary capital
and asset backed investment by the VCT industry seems to be going well
-- and this is no bad thing for UK Plc. We believe that, appropriately
resourced and supported, the VCT structure is well-suited to this
patient approach to long term value creation. Shareholders should be
aware that as from 1 March 2020 there is an increase in the level of VCT
qualifying investments to 80% (up from 70%) that a VCT needs to hold.
Your Company comfortably exceeds that threshold.
Planning for the Future
In previous year's report we highlighted some significant changes in the
VCT market which might present opportunities for your VCT. Your Board
continues to explore various options actively but are not yet able to
bring forward proposals to shareholders. Should discussions prove
successful we would present them to shareholders as soon as practicable.
However, there can be no certainty that any of these discussions will
lead to a concrete proposal, at this time or in the future. Shareholders
may have noticed developments at sister company, Oxford Technology 2 VCT
Plc, where it was proposed to add a new class of share raising money
under a new manager to keep the fund economic and to spread overheads
over a wider asset base. While this proposal did not complete, your
Board continues to explore similar options.
Your Board continues to look at methods of improving operational
efficiency, reducing costs and, more generally, putting in place
appropriate plans to ensure that your VCT's operational costs relative
to its overall size remain within acceptable limits. The current level
of operating costs, directors' fees and total investment management fees
are GBP113k (2018: GBP111k) and are just under 1.9% of year end assets;
one of the lowest ratios in the industry.
Whilst all companies will be affected in some way by the eventual
outcome of Brexit, our particular concern was with Ixaris with their
European payment systems in the case of an unplanned no deal exit in
April. Ixaris have taken steps to mitigate a no deal Brexit. Your Board
will continue to monitor the ongoing negotiations and will be prepared
to take appropriate action to support portfolio companies if the
situation changes.
Change of Auditor
As we announced in our half year results, James Cowper Kreston, our
previous auditor, decided to withdraw from auditing Public Interest
Entities (which include VCTs) for the time being due to the increasing
regulatory landscape and associated costs, and hence resigned as our
auditor in October 2018. During a previous tender process, the Audit
Committee was also impressed by one of the other firms who responded,
and on its recommendation, the Board has appointed UHY Hacker Young LLP
("UHY") to fill the casual vacancy that had arisen. UHY have audited
this year's results, and shareholders are being asked to reappoint them
at the AGM for the year ending 29 February 2020.
AGM
Shareholders should note that the AGM for the Company will be held on
Wednesday 3 July 2019 at the Magdalen Centre, Oxford Science Park,
starting at the later time of 2 pm and will include presentations by
Oxford Technology Management and some of the companies that the Oxford
Technology VCTs have invested in. A formal Notice of the AGM has been
enclosed with these Financial Statements together with a Form of Proxy
for those not attending. We appreciate the input of our shareholders and
look forward to welcoming as many of you as possible on the day -- thank
you for your ongoing support.
Outlook
The Oxford Technology VCTs have operated and continue to operate very
much in the spirit of the old and new VCT legislation by investing in
and subsequently supporting early stage technology companies.
Unfortunately, both the previous and current VCT rules limit the amount
of follow on investment that we are sometimes able to make.
Looking ahead, though, the Board continues to believe your VCT is an
appropriate structure to hold your Company's assets. The portfolio
continues to mature, with several holdings showing potential to generate
strong returns when the appropriate time comes to realise them. As per
our stated strategy, your Board continues to work to maximise value,
reduce costs, and -- when valuations and liquidity allow -- crystallise
this value and distribute the proceeds to shareholders.
Robin Goodfellow
Chairman
21 May 2019
Investment Portfolio Review
OT3 was formed in 2002 and invested in a total of 38 companies, all
start-up or early stage technology companies. Some of these companies
failed with the loss of the investment. Some have succeeded and have
been sold. Dividends paid to shareholders to date are 36p per share.
The table on page 15 shows the companies remaining in the portfolio. A
more detailed analysis is given of the most significant investments on
the following pages. The portfolio contains several investees which are
showing promise and which have the potential to deliver significant
returns.
OT3 first invested GBP110,000 in Ixaris Systems Ltd in 2002 when the
company consisted of just three founders with an idea for a
transaction-based financial solution that would give anyone the ability
to pay online. Today it is one of the leading suppliers of payment
systems to the global travel industry. Ixaris is currently slightly
exceeding its forecasts However, considerable uncertainty exists about
how Brexit might affect them. Ixaris is establishing a European company
to help mitigate any potential adverse effects of a disorderly Brexit to
which it has material exposure.
Scancell, in which OT3 first invested in 2003 when the company was based
in a University laboratory, is now AIM-listed. Scancell is developing
novel immunotherapies for cancer, based on two platform technologies
known as Immunobody and Moditope. Results from Scancell's first
clinical trial for the treatment of melanoma continue to be excellent
with recurrence free survival at 69% at 5 years -- surpassing results in
other trials of ipilimumab (leading immunotherapy for cancer) which
showed 46.5% at 3 years.
There was a further investment round in April 2018, however, OT3 was
unable to participate due to the constraints imposed by the VCT rules.
Scancell will use the proceeds of the placing and open offer to support
clinical trials for SCIB1, SCIB2 and Modi-1 and pre-clinical work for
Modi-2.
Unfortunately, Scancell has had a steady decline in share price over the
year. In October 2018, there was an announcement of a delay to the
planned start of the clinical trial as the FDA had yet to approve the
Trichor device/SCIB1 combination as an Investigational New Device (IND).
Post year end, in April 2019, Scancell received all of the regulatory,
ethical and legal approvals for the UK arm of this trial. Scancell has
been granted patents for the Modi platform which will give it a very
strong position going into the future.
Arecor has progressed its insulin programme and has both the fastest
acting and most concentrated formulations in the world. The company
raised GBP6m to start clinical trials for its insulin products. In
March 2019 following the year end, Arecor obtained approval to start its
clinical trial for the Ultra-Rapid Acting Insulin. It has also received
funding from Innovate for its Superfast post-prandial insulin.
In February 2019 ImmBio signed a license deal for PnuBioVax with a
subsidiary of CNBG, the leading Chinese biologics company. The deal
grants a license to CNBG for the Chinese market. PnuBioVax is a vaccine
that targets pneumococcal disease in children and the elderly. GBP30k
was invested in April 2018 and a further GBP20k invested in a post
balance sheet event in March 2019, following the signature of the
Chinese licence deal.
Orthogem received a CE mark for its putty product in early 2018. Sales
have started, but in many countries approval based on the CE mark is
still going through the procedures. First sales have been registered for
the putty in India. Steve Lane, the former CEO has moved on to another
company and has been replaced by a new Executive Chairman, Bruce
Venning.
STL Management Ltd (OT3 holds Select Technology via holding company STL
Management Limited) specialises in software for photocopiers -- now
known as MFDs -- Multi-Function Devices. Over the last decade Select
Technology has built up a global network of distributors and dealers
through which it sells both its own and third party products. These
products now include PaperCut, KPAX, Foldr, Drivve Image, EveryonePrint
and Square 9 Enterprise Content Management. Sales have increased from
GBP210k in the year to July 2010 to over GBP6.8m in the year to January
2019, up from GBP5.6m in the year before. Select Technology paid a
dividend in February 2019.
New Investments
There were three follow-on investments during the year of GBP30k into
ImmBio, GBP83k into Orthogem and GBP219k into Arecor. All new
investments have complied with both EU State Aid rules and HMRC VCT
rules.
Disposals during the year
The shares in Abzena were sold in November 2018 yielding GBP32k. OT3
also received the final escrow amount from the sale of Allinea shares of
GBP30k during the year. Glide Technologies was dissolved in October
2018, but there was no impact in the P&L as the investment had been
fully provided for.
Valuation Methodology
Quoted and unquoted investments are valued in accordance with current
industry guidelines that are compliant with International Private Equity
and Venture Capital (IPEVC) Valuation Guidelines and current financial
reporting standards.
VCT Compliance
Compliance with the main VCT regulations as at 28 February 2019 and for
the year then ended is summarised as follows:
Type of Investment
By HMRC Valuation Rules Actual Target
VCT Qualifying Investments 91% Minimum obligation of: 70%
Non-Qualifying Investments 9% Maximum allowed: 30%
Total 100% 100%
At least 70% of each investment must be in eligible shares - Complied.
No more than 15% of the income from shares and securities is retained -
Complied.
No investment constitutes more than 15% of the Company's portfolio (by
value at time of investment or when the holding is added to) - Complied.
The Company's income in the period has been derived wholly or mainly
(70% plus) from shares or securities - Complied.
No investment made by the VCT has caused the company to receive more
than GBP5m of State Aid investment in the year, nor more than the
lifetime limit of GBP12m - Complied.
Table of Investments held by Company at 28 February 2019
Carrying Change
Net cost value in value % equity
Date of initial of investment at 28/02/19 for the % equity held by % of Net
Company Description investment GBP'000 GBP'000 year GBP'000 held OT3 all OTVCTs Assets
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Ixaris Internet payments Aug 2002 535 3,946 414 7.2 7.2 65.0
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
ImmBio Novel vaccines May 2003 461 519 284 6.3 20.9 8.5
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Protein
Arecor stabilisation Jul 2007 443 501 244 3.1 10.5 8.3
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Scancell
(Bid price
of 7p) Cancer therapeutics Dec 2003 409 359 (359) 1.3 3.3 5.9
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Bone graft
Orthogem material Dec 2004 317 239 97 11.5 30.5 3.9
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Select - STL
Management Photocopier
Ltd Interfaces Nov 2004 47 163 28 2.8 58.6 2.7
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Insense Wound healing May 2003 333 60 - 2.3 6.8 1.0
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Low power
Invro electronics Apr 2004 40 20 (20) 33.1 33.1 0.3
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Inaplex Data integration Mar 2003 58 6 (6) 13.3 34.8 0.1
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Plasma Directional
Antennas antennas Sep 2004 358 3 - 12.4 48.8 0.1
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Metal Production
Nanopowders of metal powders Nov 2002 153 - (5) 20.0 36.7 -
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Superhard Production
Materials of hard materials Feb 2012 11 - (1) 21.8 40.0 -
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Microarray Insense spinout Dec 2013 2 - - 0.2 0.2 -
------------- ------------------- ---------------- -------------- ------------ ------------- --------- ----------- --------
Total 3,167 5,816 676 95.8
---------------------------------------------------- -------------- ------------ ------------- --------- ----------- --------
Other Net
Assets 256 4.2
---------------------------------------------------- -------------- ------------ ------------- --------- ----------- --------
NET ASSETS 6,072 100.0
---------------------------------------------------- -------------- ------------ ------------- --------- ----------- --------
Number of shares in issue: 6,785,233
Net Asset Value per share at 28 February 2019: 89.5p
Dividends per share paid to date: 36.0p
The table shows the current portfolio holdings. The investments in
Ciphergrid, Concurrent Thinking, Coraltech, Datasoft Medical, Freehand
Surgical, IFM, Im-Pak, Inscentinel, Novarc, OST, Promic, ReviveR,
Streamline Computing, Concurrent Thinking and Glide Technologies have
been written off. The investments in Avidex, Archimed, BioAnaLab,
Commerce Decisions, Dataflow, MET, Telegesis, Equitalk, Allinea and
Abzena have been sold.
Lucius Cary
Director
OT3 Managers Ltd
Investment Manager
21 May 2019
Directors' Report
The Directors present their report together with Financial Statements
for the year ended 28 February 2019.
The Directors 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
performance, business model and strategy.
This report has been prepared by the Directors in accordance with the
requirements of s415 of the Companies Act 2006. The Company's
independent auditor is required by law to report on whether the
information given in the Directors' Report is consistent with the
Financial Statements.
Principal Activity
The Company commenced business in March 2002. The Company invests in
start-up and early stage technology companies in general located within
60 miles of Oxford. The Company has maintained its approved status as a
Venture Capital Trust by HMRC.
Directors
The Directors of the Company are required to notify their interests
under Disclosure and Transparency Rule 3.12R. The membership of the
Board and their beneficial interests in the ordinary shares of the
company at 28 February 2019 and at 28 February 2018 are set out below:
Name 2019 2018
R Goodfellow 35,000
35,000
D Livesley Nil
Nil
R Roth 38,149
38,149
A Starling Nil
Nil
Under the Company's Articles of Association one third of the Directors
are required to retire by rotation each year. Robin Goodfellow and Alex
Starling will be nominated for re-appointment at the forthcoming AGM.
The Board believes that both non-executive Directors continue to provide
a valuable contribution to the Company and remain committed to their
roles. The Board recommends that Shareholders support the resolutions
to re-elect Robin Goodfellow and Alex Starling at the forthcoming AGM.
The Board is cognisant of shareholders' preference for Directors not to
sit on the boards of too many larger companies ("overboarding").
Shareholders will be aware that in July 2015, the Company, along with
the other VCTs that were managed by Oxford Technology Management,
appointed directors such that the four VCTs each had a Common Board. In
addition, Richard Roth has subsequently also become a Director of Seneca
Growth Capital VCT Plc, a VCT investing in the Med Tech sector which is
also self-managed and has a number of investments in common with the
Oxford Technology VCTs. Whilst great care is taken to safeguard the
interests of the shareholders of each separate company, there is an
element of overlap in the workload of each Director across the four OT
funds due to the way the VCTs are managed. The Directors note that the
workload related to the four OT funds is less than it would be for four
totally separate and larger funds, and are satisfied that Richard Roth
has the time to focus on the requirements of each OT fund.
Investment Management Fees
OT3 Managers Ltd, the Company's wholly owned subsidiary, has an
agreement to provide investment management services to the Company for a
fee of 1% of net assets per annum. David Livesley and Robin Goodfellow,
together with Lucius Cary are Directors of OT3 Managers Ltd.
Directors' and Officers' Insurance
The Company has maintained insurance cover, on behalf of the Directors,
indemnifying them against certain liabilities which may be incurred by
them in relation to their duties as Directors of the Company.
Ongoing Review
The Board has reviewed and continues to review all aspects of internal
governance to mitigate the risk of breaches of VCT rules or company law.
Whistleblowing
The Board has been informed that the Investment Manager has arrangements
in place in accordance with the UK Corporate Governance Code's
recommendations by which staff of Oxford Technology Management or the
Secretary of the Company may, in confidence, raise concerns within their
respective organisations about possible improprieties in matters of
financial reporting or other matters.
Bribery Act 2010
The Company is committed to carrying out business fairly, honestly and
openly. The Investment Manager has established policies and procedures
to prevent bribery within its organisation. The Company has adopted a
zero tolerance approach to bribery and will not tolerate bribery under
any circumstance in any transaction the Company is involved in. The
Company has instructed the Investment Manager to adopt the same approach
with investee companies.
Relations with Shareholders
The Company values the views of its shareholders and recognises their
interest in the Company. The Company's website provides information on
all of the Company's investments, as well as other information of
relevance to shareholders (
https://www.globenewswire.com/Tracker?data=plko3QnRcC_u_j9eU6hmWCsgP010tCJ-ewzPvQCilRJkhcHmaAMsCM-a_Q6A0RGQPQQ_-aG-SeP_WAtDAwnGOC7esUMW0_OkF0HjdkWkJiaB_g9y3yy-3mWCVjtlkoCVG1u6AunZ3AIByEwXMVSK3Q==
www.oxfordtechnologyvct.com/vct3.html).
Shareholders have the opportunity to meet the Board at the Annual
General Meeting. In addition to the formal business of the AGM the
Board is available to answer any questions a shareholder may have.
The Board is also happy to respond to any written queries made by
shareholders during the course of the year and can be contacted at the
Company's registered office: Magdalen Centre, Oxford Science Park,
Oxford OX4 4GA.
Going Concern
The assets of the Company consist mainly of securities, one of which is
AIM quoted, quite liquid and readily accessible, as well as cash. After
making enquiries, the Directors have a reasonable expectation that the
Company has adequate resources to continue in operational existence for
the foreseeable future. For this reason they have adopted the going
concern basis in preparing the Financial Statements.
Share Capital
As disclosed on page 57, the Board has authority to make market
purchases of the Company's own shares. No shares were purchased by the
Company during the year.
The Board has authority to allot up to 339,260 shares (representing
approximately 5% of the ordinary share capital as at 2 May 2018). No
shares were allotted by the Company during the year.
The total number of Ordinary Shares of 10p each in issue at 28 February
2019 was 6,785,233 (2018: 6,785,233) with each share having one vote.
There are no other share classes in issue
Companies Act 2006 disclosures
In accordance with Schedule 7 of the Large and Medium Size Companies and
Groups (Accounts and Reports) Regulations 2008, as amended, the
Directors disclose the following information:
-- The Company's capital structure and voting rights are summarised above,
and there are no restrictions on voting rights nor any agreement between
holders of securities that result in restrictions on the transfer of
securities or on voting rights;
-- There exist no securities carrying special rights with regard to the
control of the Company;
-- The rules concerning the appointment and replacement of directors,
amendment of the Articles of Association and powers to issue or buy back
the Company's shares are contained in the Articles of Association of the
Company and the Companies Act 2006;
-- The Company does not have any employee share scheme;
-- There exist no agreements to which the Company is party that may affect
its control following a takeover bid; and
-- There exist no agreements between the Company and its Directors providing
for compensation for loss of office that may occur following a takeover
bid or for any other reason.
Substantial Shareholders
At 28 February 2019, the Company has been notified of the following
investors whose interest exceeds three percent of the Company's issued
share capital: State Street Nominees Limited, 8.7% (representing the
beneficial interest of Oxfordshire County Council Pension Fund);
Hargreaves Lansdown Nominees Limited, 7.7%; Mr Richard Vessey, 3.5% and
Redmayne Nominees Limited 3.1%. The holdings in Hargreaves Lansdown
Nominees Limited and Redmayne Nominees Limited include the beneficial
interests of Ms Shivani Palakpari Shree Parikh, who has a declared
holding of 4.1%.
Auditors
As discussed in the Chairman's Report on page 7, UHY Hacker Young LLP
have been appointed as the independent auditors in accordance with
Section 489 of the Companies Act 2006, and will offer themselves for
reappointment at the AGM.
On behalf of the Board
Robin Goodfellow
Chairman
21 May 2019
Directors' Remuneration Report
Introduction
This report has been prepared by the Directors in accordance with the
requirements of the Companies Act 2006. The Company's independent
auditor, UHY Hacker Young LLP, is required to give its opinion on
certain information included in this report. This report includes a
statement regarding the Directors' Remuneration Policy. This report sets
out the Company's Directors' Remuneration Policy and the Annual
Remuneration Report which describes how this policy has been applied
during the year.
The Directors' Remuneration Policy was last approved by shareholders at
the AGM on 12 July 2018. It needs to be put to a shareholder vote every
three years, and shareholders will be asked to approve it again at the
Annual General Meeting in 2021.
Shareholders also need to approve the Directors' Remuneration Report
every year. It was last approved at the AGM on 12 July 2018 on a
unanimous show of hands and 100% of proxies voted in favour, and a
Resolution to approve the Directors' Remuneration Report for the year
ended 28 February 2019 will also be proposed at the Annual General
Meeting on 3 July 2019.
Directors' Terms of Appointment
The Board consists entirely of non-executive Directors who meet at least
four times a year and on other occasions as necessary to deal with
important aspects of the Company's affairs. Directors are appointed with
the expectation that they will serve for at least three years and are
expected to devote the time necessary to perform their duties. All
Directors retire at the first general meeting after election and
thereafter every third year, with at least one Director standing for
election or re-election each year. Re-election will be recommended by
the Board, but is dependent upon shareholder vote. Directors who have
been in office for more than nine years will stand for annual
re-election in line with the AIC Code. There are no service contracts in
place, but Directors have a letter of appointment.
Directors' Remuneration Policy
The Board acts as the Remuneration Committee and meets annually to
review Directors' pay to ensure it remains appropriate given the need to
attract and retain candidates of sufficient calibre and ensure they are
able to devote the time necessary to lead the Company in achieving its
strategy.
The Articles of Association of the company state that the aggregate of
the remuneration (by way of fee) of all the Directors shall not exceed
GBP50,000 per annum unless otherwise approved by Ordinary Resolution of
the Company. The following Directors' fees are payable by the Company:
per annum
Director Base Fee GBP3,500
Chairman's Supplement GBP2,000
Audit Committee Chairman GBP3,000
Audit Committee Member GBP1,500
The OT3 Director Fees are amongst the lowest of any VCT (apart from the
other OT VCTs). However, the Board has spent and continues to spend more
time on Company activities than was initially envisaged in Summer 2015
(when the fees were last changed) partly due to closer involvement with
investment, accounting and administration procedures and partly due to
compliance with additional government regulations. Fees remain at the
levels approved last year.
Typically, VCT industry total directors' fees are in excess of GBP50k
and individual fees in excess of GBP15k for equivalent levels of work.
Robin Goodfellow chairs the Company. Richard Roth chairs the Audit
Committee, with Robin Goodfellow as a member of the Committee. As the
VCT is self-managed, the Audit Committee carries out a particularly
important role for the VCT and plays a significant part in the sign off
of quarterly management accounts, and the production of the half year
and annual statutory accounts.
Fees are currently paid annually. The fees are not specifically related
to the Directors' performance, either individually or collectively. No
expenses are paid to the Directors. There are no share option schemes
or pension schemes in place, but Directors are entitled to a share of
the carried interest as detailed below. The Directors may at their
discretion pay additional sums in respect of specific tasks carried out
by individual Directors on behalf of the Company.
David Livesley and Robin Goodfellow receive no remuneration in respect
of their directorships of OT3 Managers Ltd, the Company's Investment
Manager.
The performance fee is detailed in note 3. Current Directors are
entitled to benefit from any payment made, subject to a formula driven
by relative lengths of service. The performance fee becomes payable if
a certain cash return threshold to shareholders is exceeded -- the
excess is then subject to a 20% carry that is distributed to Oxford
Technology Management, past Directors and current Directors; the
remaining 80% is returned to shareholders. At 28 February 2019 no
performance fee was due.
Should any performance fee be payable at the end of the year to 29
February 2020, Alex Starling, Robin Goodfellow, and Richard Roth would
each receive 0.26% of any amount over the threshold and David Livesley
0.70%. No performance fee will be payable for the year ending 29
February 2020 unless original shareholders have received back at least
139.2p in cash for each 100p (gross) invested.
Relative Spend on Directors' Fees
The Company has no employees, so no consultation with employees or
comparison measurements with employee remuneration are appropriate.
Loss of Office
In the event of anyone ceasing to be a Director, for any reason, no loss
of office payments will be made. There are no contractual arrangements
entitling any Director to any such payment.
Annual Remuneration Report
No change to Director's remuneration is expected for the year ending 29
February 2020.
Directors' Fees Year End 29/02/20 Year End 28/02/19 Year End 28/02/18
(unaudited) (audited) (audited)
---------------- ----------------- ----------------- -----------------
Robin Goodfellow GBP7,000 GBP7,000 GBP7,000
---------------- ----------------- ----------------- -----------------
Richard Roth GBP6,500 GBP6,500 GBP6,500
---------------- ----------------- ----------------- -----------------
Alex Starling GBP3,500 GBP3,500 GBP3,500
---------------- ----------------- ----------------- -----------------
David Livesley GBP3,500 GBP3,500 GBP3,500
---------------- ----------------- ----------------- -----------------
Total GBP20,500 GBP20,500 GBP20,500
---------------- ----------------- ----------------- -----------------
Income Statement
Year Ended Year Ended
28 February 2019 28 February 2018
Note Revenue Capital Total Revenue Capital Total
Ref. GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
(Loss)/gain on disposal
of
fixed asset investments - (8) (8) - 9 9
Unrealised gain on
valuation of fixed
asset investments - 344 344 - 615 615
Investment income 2 2 - 2 10 - 10
Investment management
fees 3 (15) (44) (59) (14) (42) (56)
Other expenses 4 (54) - (54) (55) - (55)
Return on ordinary
activities before
tax (67) 292 225 (59) 582 523
Taxation on return
on ordinary activities 5 - - - - - -
Return on ordinary
activities after tax (67) 292 225 (59) 582 523
Return on ordinary
activities after tax
attributable to
equity shareholders (67) 292 225 (59) 582 523
Earnings per share
-- basic and diluted 6 (1.0)p 4.3p 3.3p (0.9)p 8.6p 7.7p
There was no other Comprehensive Income recognised during the year.
The 'Total' column of the Income Statement is the Profit and Loss
Account of the Company, the supplementary Revenue and Capital return
columns have been prepared under guidance published by the Association
of Investment Companies.
All Revenue and Capital items in the above statement derive from
continuing operations.
The Company has only one class of business and derives its income from
investments made in shares and securities and from bank and money market
funds.
The accompanying notes are an integral part of the Financial Statements.
Statement of Changes in Equity
Profit
Share Share Unrealised & Loss
Capital Premium Capital Reserve Reserve Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
-----------------------------
As at 1 March 2017 679 718 1,349 2,849 5,595
Revenue return on ordinary
activities after tax - - - (59) (59)
Expenses charged to capital - - - (42) (42)
Current period gains on
disposal - - - 9 9
Current period gains on
fair value of investments - - 615 - 615
Dividends paid - - - (271) (271)
Prior years' unrealised
losses now realised - - 97 (97) -
Balance as at 28 February
2018 679 718 2,061 2,389 5,847
Revenue return on ordinary
activities after tax - - - (67) (67)
Expenses charged to capital - - - (44) (44)
Current period losses
on disposal - - - (8) (8)
Current period gains on
fair value of investments - - 344 - 344
Prior years' unrealised
losses now realised - - 244 (244) -
Balance as at 28 February
2019 679 718 2,649 2,026 6,072
The accompanying notes are an integral part of the Financial Statements.
Balance Sheet
Year Ended Year Ended
28 February 2019 28 February 2018
Note
Ref. GBP'000 GBP'000 GBP'000 GBP'000
Fixed Asset Investments
At Fair Value 7 5,816 5,190
Current Assets
Debtors 8 2 23
Cash At Bank 266 644
Creditors: Amounts
Falling Due
Within 1 Year 9 (12) (10)
Net Current Assets 256 657
Net Assets 6,072 5,847
Called Up Equity Share
Capital 10 679 679
Share Premium 718 718
Unrealised Capital
Reserve 11 2,649 2,061
Profit and Loss Account
Reserve 11 2,026 2,389
Total Equity Shareholders'
Funds 11 6,072 5,847
Net Asset Value Per 89.5p 86.2p
Share
The accompanying notes are an integral part of the Financial Statements.
The statements were approved by the Directors and authorised for issue
on 21 May 2019 and are signed on their behalf by:
Robin Goodfellow
Chairman
21 May 2019
Statement of Cash Flows
Year Ended Year Ended
28 February 2019 28 February 2018
GBP'000 GBP'000
Cash flows from operating
activities
Return on ordinary activities
before tax 225 523
Adjustments for:
Loss/ (gain) on disposal
of investments 8 (9)
Gain on valuation of investments (344) (615)
Decrease in debtors 21 80
Increase/(decrease) in creditors 2 (45)
Movement in investment debtors
and creditors (20) (10)
Outflow from operating activities (108) (76)
Cash flows from investing
activities
Purchase of investments (332) (131)
Disposal of investments 62 127
Outflow from investing
activities (270) (4)
Cash flows from financing
activities
Dividends paid - (271)
Outflow from financing activities - (271)
Decrease in cash at bank (378) (351)
Opening cash and cash equivalents 644 995
Cash and cash equivalents
at year end 266 644
The accompanying notes are an integral part of the Financial Statements.
Notes to the Financial Statements
The Financial Statements have been prepared under Financial Reporting
Standard 102 -- 'The Financial Reporting Standard applicable in the
United Kingdom and Republic of Ireland' ('FRS 102'). The accounting
policies have not materially changed from last year.
1. Principal Accounting Policies
Basis of Preparation
The Financial Statements have been prepared under the historical cost
convention, except for the measurement at fair value of certain
financial instruments, and in accordance with UK Generally Accepted
Accounting Practice ("GAAP"), including FRS 102 and with the Companies
Act 2006 and the Statement of Recommended Practice (SORP) 'Financial
Statements of Investment Trust Companies and Venture Capital Trusts
(revised 2014)' issued by the AIC.
The principal accounting policies have remained materially unchanged
from those set out in the Company's 2018 Annual Report and Financial
Statements. A summary of the principal accounting policies is set out
below.
FRS 102 sections 11 and 12 have been adopted with regard to the
Company's financial instruments. The Company held all fixed asset
investments at fair value through profit or loss. Accordingly, all
interest income, fee income, expenses and gains and losses on
investments are attributable to assets held at fair value through profit
or loss.
The most important policies affecting the Company's financial position
are those related to investment valuation and require the application of
subjective and complex judgements, often as a result of the need to make
estimates about the effects of matters that are inherently uncertain and
may change in subsequent periods. These are discussed in more detail
below.
Going Concern
The assets of the Company consist mainly of securities, one of which is
AIM quoted, quite liquid and readily accessible, as well as cash. After
reviewing the Company's forecasts and expectations, the Directors have a
reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. The
Company therefore continues to adopt the going concern basis in
preparing its Financial Statements.
Key Judgements and Estimates
The preparation of the Financial Statements requires the Board to make
judgements and estimates regarding the application of policies and
affecting the reported amounts of assets, liabilities, income and
expenses. Estimates and assumptions mainly relate to the fair valuation
of the fixed asset investments particularly unquoted investments.
Estimates are based on historical experience and other assumptions that
are considered reasonable under the circumstances. The estimates and the
assumptions are under continuous review with particular attention paid
to the carrying value of the investments.
Investments are regularly reviewed to ensure that the fair values are
appropriately stated. Unquoted investments are valued in accordance with
current IPEVC Valuation Guidelines, which can be found on their website
at www.privateequityvaluation.com, although this does rely on subjective
estimates such as appropriate sector earnings multiples, forecast
results of investee companies, asset values of investee companies and
liquidity or marketability of the investments held.
Although the Directors believe that the assumptions concerning the
business environment and estimate of future cash flows are appropriate,
changes in estimates and assumptions could result in changes in the
stated values. This could lead to additional changes in fair value in
the future.
Functional and Presentational Currency
The Financial Statements are presented in Sterling (GBP). The functional
currency is also Sterling (GBP).
Cash and Cash Equivalents
Cash and cash equivalents includes cash in hand, deposits held at call
with banks, other short-term highly liquid investments with original
maturities of three months or less and also include bank overdrafts.
Fixed Asset Investments
The Company's principal financial assets are its investments and the
policies in relation to those assets are set out below.
Purchases and sales of investments are recognised in the Financial
Statements at the date of the transaction (trade date).
These investments will be managed and their performance evaluated on a
fair value basis and information about them is provided internally on
that basis to the Board. Accordingly, as permitted by FRS 102, the
investments are measured as being fair value through profit or loss on
the basis that they qualify as a group of assets managed, and whose
performance is evaluated, on a fair value basis in accordance with a
documented investment strategy. The Company's investments are measured
at subsequent reporting dates at fair value.
In the case of investments quoted on a recognised stock exchange, fair
value is established by reference to the closing bid price on the
relevant date or the last traded price, depending upon convention of the
exchange on which the investment is quoted. In the case of AIM quoted
investments this is the closing bid price.
In the case of unquoted investments, fair value is established by using
measures of value such as the price of recent transactions, earnings
multiple, revenue multiple, discounted cash flows and net assets. These
are consistent with the IPEVC Valuation Guidelines.
Gains and losses arising from changes in fair value of investments are
recognised as part of the capital return within the Income Statement and
allocated to the unrealised capital reserve.
In the preparation of the valuations of assets the Directors are
required to make judgements and estimates that are reasonable and
incorporate their knowledge of the performance of the investee
companies.
Fair Value Hierarchy
Paragraph 34.22 of FRS 102 regarding financial instruments that are
measured in the balance sheet at fair value requires disclosure of fair
value measurements dependent on whether the stock is quoted and the
level of the accuracy in the ability to determine its fair value. The
fair value measurement hierarchy is as follows:
For Quoted Investments:
Level 1: quoted prices in active markets for an identical asset. The
fair value of financial instruments traded in active markets is based on
quoted market prices at the balance sheet date. A market is regarded as
active if quoted prices are readily and regularly available, and those
prices represent actual and regularly occurring market transactions on
an arm's length basis. The quoted market price used for financial assets
held is the bid price at the Balance Sheet date.
Level 2: where quoted prices are not available (or where a stock is
normally quoted on a recognised stock exchange that no quoted price is
available), the price of a recent transaction for an identical asset,
providing there has been no significant change in economic circumstances
or a significant lapse in time since the transaction took place. The
Company held no such investments in the current or prior year.
For investments not quoted in an active market:
Level 3: the fair value of financial instruments that are not traded in
an active market is determined by using valuation techniques. These
valuation techniques maximise the use of observable data (e.g. the price
of recent transactions, earnings multiple, discounted cash flows and/or
net assets) where it is available and rely as little as possible on
entity specific estimates.
There have been no transfers between these classifications in the year
(2018: none). The change in fair value for the current and previous year
is recognised in the income statement.
Income
Investment income includes interest earned on bank balances and from
unquoted loan note securities, and dividends. Fixed returns on debt are
recognised on a time apportionment basis so as to reflect the effective
yield, provided it is probable that payment will be received in due
course. Dividend income from investments is recognised when the
shareholders' rights to receive payment have been established, normally
the ex dividend date.
Expenses
All expenses are accounted for on an accruals basis. Expenses are
charged wholly to revenue with the exception of the investment
management fee which has been charged 75% to capital and 25% to revenue.
Any applicable performance fee will be charged 100% to capital.
Revenue and Capital
The revenue column of the Income Statement includes all income and
revenue expenses of the Company. The capital column includes gains and
losses on disposal and holding gains and losses on investments. Gains
and losses arising from changes in fair value of investments are
recognised as part of the capital return within the Income Statement and
allocated to the appropriate capital reserve on the basis of whether
they are realised or unrealised at the balance sheet date.
Taxation
Current tax is recognised for the amount of income tax payable in
respect of the taxable profit for the current or past reporting periods
using the current tax rate. The tax effect of different items of
income/gain and expenditure/loss is allocated between capital and
revenue return on the "marginal" basis as recommended in the SORP.
Deferred tax is recognised on an undiscounted basis in respect of all
timing differences that have originated, but not reversed, at the
balance sheet date, except as otherwise indicated.
Deferred tax assets are only recognised to the extent that it is
probable that they will be recovered against the reversal of deferred
tax liabilities or other future taxable profits.
Financial Instruments
The Company's principal financial assets are its investments and the
policies in relation to those assets are set out above. Financial
liabilities and equity instruments are classified according to the
substance of the contractual arrangements entered into.
An equity instrument is any contract that evidences a residual interest
in the assets of the entity after deducting all of its financial
liabilities. Where the contractual terms of share capital do not have
any terms meeting the definition of a financial liability then this is
classed as an equity instrument.
The Company does not have any externally imposed capital requirements.
Reserves
Called up Equity Share Capital -- represents the nominal value of shares
that have been issued.
Share Premium Account -- includes any premiums received on issue of
share capital. Any transaction costs associated with the issuing of
shares are deducted from the Share Premium Account.
Unrealised Capital Reserve arises when the Company revalues the
investments still held during the period and any gains or losses arising
are credited/charged to the Unrealised Capital Reserve. When an
investment is sold, any balance held on the Unrealised Capital Reserve
is transferred to the Profit and Loss Reserve as a movement in reserves.
The Profit and Loss Reserve represents the aggregate of accumulated
realised profits, less losses and dividends.
Dividends Payable
Dividends payable are recognised as distributions in the Financial
Statements when the Company's liability to make payment has been
established. This liability is established for interim dividends when
they are declared by the Board, and for final dividends when they are
approved by the Shareholders.
2. Investment Income
Year Ended Year Ended
28 February 2019 28 February 2018
GBP'000 GBP'000
Dividends received 2 -
Loan interest received - 10
Total 2 10
3. Investment Management Fees
Expenses are charged wholly to revenue with the exception of the
investment management fee which has been charged 75% to capital in line
with industry practice.
Year Ended Year Ended
28 February 2019 28 February 2018
GBP'000 GBP'000
Investment management fee 59 56
Total 59 56
In the year to 28 February 2019 the manager received a fee of 1% of the
net asset value as at the previous year end (2018: 1%). Oxford
Technology Management (OTM) is also entitled to certain monitoring fees
from investee companies and the Board reviews the amounts. OTM also
received a further GBP47k in 2018, the final tranche of a payment which
had been deferred from previous years. This was part of the revised
agreement, with effect from 1 March 2015. No further liability is
payable as at 28 February 2018 or 28 February 2019.
A performance fee is payable to the Investment Manager once original
shareholders have received a specified threshold in cash for each 100p
(gross) invested. The original threshold of 100p has been increased by
compounding that portion that remains to be paid to shareholders by 6%
per annum with effect from 1 March 2013, resulting in the remaining
required threshold rising to 97.4p at 28 February 2019, corresponding to
a total shareholder return of 133.4p after taking into account the 36.0p
already paid out (36.0p + 97.4p = 133.4p). After this amount has been
distributed to shareholders, each extra 100p distributed goes 80p to the
shareholders and 20p to the beneficiaries of the performance incentive
fee, of which Oxford Technology Management receives 15p.
A performance fee of GBPnil (2018: GBPnil) has been accrued to date. Any
applicable performance fee accrual will be charged (or credited) 100% to
capital.
Expenses are capped at 3%, including the management fee, but excluding
Directors' fees and any performance fee.
4. Other Expenses
All expenses are accounted for on an accruals basis. All expenses are
charged through the income statement except as follows:
-- those expenses which are incidental to the acquisition of an
investment are included within the cost of the investment;
-- expenses which are incidental to the disposal of an investment
are deducted from the disposal proceeds of the investment.
Year Ended Year Ended
28 February 2019 28 February 2018
GBP'000 GBP'000
Directors' remuneration 21 21
Auditors' remuneration 8 6
Other expenses 25 28
Total 54 55
5. Tax on Ordinary Activities
Corporation tax payable at 19.0% (2018: 19.1%) is applied to profits
chargeable to corporation tax, if any. The corporation tax charge for
the period was GBP nil (2018: GBP nil).
Year Ended Year Ended
28 February 2019 28 February 2018
GBP'000 GBP'000
Return on ordinary activities
before tax 225 523
Current tax at standard rate
of taxation 43 100
UK dividends not taxable - -
Unrealised gains not taxable (65) (117)
Realised gains not taxable 1 (2)
Excess management expenses
carried forward 21 19
Total current tax charge - -
Unrelieved management expenses of GBP2,014,783 (2018: GBP1,902,515)
remain available for offset against future taxable profits.
6. Earnings per Share
The calculation of earnings per share (basic and diluted) for the period
is based on the net profit of GBP225,000 (2018: GBP523,000) attributable
to shareholders divided by the weighted average number of shares
6,785,233 (2018: 6,785,233) in issue during the period. There are no
potentially dilutive capital instruments in issue and, therefore, no
diluted returns per share figures are relevant. The basic and diluted
earnings per share are therefore identical.
7. Investments
AIM quoted investments Unquoted investments
Level 1 Level 3 Total investments
GBP'000 GBP'000 GBP'000
Valuation and net book
amount:
Book cost as at 28
February 2018 478 2,651 3,129
Cumulative revaluation
to 28 February 2018 290 1,771 2,061
Valuation at 28 February
2018 768 4,422 5,190
Movement in the year:
Purchases at cost - 332 332
Disposals -- cost (69) (225) (294)
Disposals - revaluation 19 225 244
Revaluation in year (359) 703 344
Valuation at 28 February
2019 359 5,457 5,816
Book cost at 28 February
2019 409 2,758 3,167
Cumulative revaluation
to
28 February 2019 (50) 2,699 2,649
Valuation at 28 February
2019 359 5,457 5,816
Subsidiary Company
The Company also holds 100% of the issued share capital of OT3 Managers
Ltd at a cost of GBP1.
Results of the subsidiary undertaking for the year ended 28 February
2019 are as follows:
Country of Nature of Turnover Retained Net Assets
Registration Business profit/loss
OT3 Managers England and Investment
Ltd Wales Manager GBP58,465 GBP0 GBP1
Consolidated group Financial Statements have not been prepared as the
subsidiary undertaking is not considered to be material for the purpose
of giving a true and fair view. The Financial Statements therefore
present only the results of Oxford Technology 3 VCT plc, which the
Directors also consider is the most useful presentation for
Shareholders.
8. Debtors
28 February 2019 28 February 2018
GBP'000 GBP'000
Prepayments, accrued income 2 2
Accrued sales proceeds - 21
Total 2 23
9. Creditors -- amounts falling due in less than 1 year
28 February 2019 28 February 2018
GBP'000 GBP'000
Creditors and accruals 12 10
Total 12 10
10. Share Capital
28 February 2019 28 February 2018
GBP'000 GBP'000
Allotted, called up and fully
paid:
6,785,233 (2018: 6,785,233)
ordinary shares of 10p each 679 679
11. Reserves
When the Company revalues its investments during the period, any gains
or losses arising are credited/charged to the Income Statement. Changes
in fair value of investments are then transferred to the Unrealised
Capital Reserve. When an investment is sold any balance held on the
Unrealised Capital Reserve is transferred to the Profit and Loss Account
Reserve as a movement in reserves.
Distributable reserves are GBP2,026,000 as at 28 February 2019 (2018:
GBP2,389,000).
Reconciliation of Movement in Shareholders' Funds
28 February 2019 28 February 2018
GBP'000 GBP'000
Shareholders' funds at start
of year 5,847 5,595
Return on ordinary activities
after tax 225 523
Dividends paid - (271)
Shareholders' funds at end
of year 6,072 5,847
12. Financial Instruments and Risk Management
The Company's financial instruments comprise equity and loan note
investments, cash balances and debtors and creditors. The Company holds
financial assets in accordance with its investment policy of investing
mainly in a portfolio of VCT -- qualifying quoted and unquoted
securities whilst holding a proportion of its assets in cash or near
cash investments in order to provide a reserve of liquidity.
The risk faced by these instruments, such as interest rate risk or
liquidity risk is considered to be minimal due to their nature. All of
these are carried in the accounts at fair value.
The Company's strategy for managing investment risk is determined with
regard to the Company's investment objective. The management of market
risk is part of the investment management process and is a central
feature of venture capital investment. The Company's portfolio is
managed with regard to the possible effects of adverse price movements
and with the objective of maximising overall returns to shareholders.
Investments in unquoted companies, by their nature, usually involve a
higher degree of risk than investments in companies quoted on a
recognised stock exchange, though the risk can be mitigated to a certain
extent by diversifying the portfolio across business sectors and asset
classes, though VCT rules limit the extent to which suitable Qualifying
Investments can be bought or sold. The overall disposition of the
Company's assets is regularly monitored by the Board.
13. Capital Commitments
The Company had no commitments at 28 February 2019 or 28 February 2018.
14. Related Party Transactions
OT3 Managers Ltd, a wholly owned subsidiary, provides investment
management services to the Company with effect from 1 July 2015 for a
fee of 1% of net assets per annum. During the year, GBP58,465 (2018:
GBP55,949) was paid in respect of these fees. No amounts were
outstanding at the year end.
15. Events after the Balance Sheet Date
During March 2019, OT3 subscribed for ImmBio shares at a cost of GBP20k.
16. Control
Oxford Technology 3 VCT Plc is not under the control of any one party or
individual.
Company Number: 4351474
Note to the announcement:
The financial information set out in this announcement does not
constitute statutory accounts as defined in the Companies Act 2006 ("the
Act"). The balance sheet as at 28 February 2019, income statement and
cash flow statement for the period then ended have been extracted from
the Company's 2019 statutory financial statements upon which the
auditor's opinion is unqualified and does not include any statement
under the section 495 of the Act.
The Annual Report and Accounts for the year ended 28 February 2019 will
be filed with the Registrar of Companies.
Copies of the documents will be submitted to the National Storage
Mechanism and are available for inspection at:
https://www.globenewswire.com/Tracker?data=z9ZSergPb18-sAURy-ZNpaSut8_unHzAncsYt4lFO0dtMB2oyl5jwYxahaFvToF5KLdk4msjfh0Goj-BKwdEHnFCank77ZQf8_bthI5BqJtCiFGbXnzp7Q24KG_9fbKVorRCHERHhSnr2iI04Rj4VA==
http://www.mornningstar.co.uk/uk/NSM
(END) Dow Jones Newswires
May 22, 2019 02:01 ET (06:01 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Oxford Technology 3 Vent... (LSE:OTT)
Historical Stock Chart
From Mar 2024 to Apr 2024
Oxford Technology 3 Vent... (LSE:OTT)
Historical Stock Chart
From Apr 2023 to Apr 2024
