Interim Results
September 30 2003 - 11:14AM
UK Regulatory
RNS Number:3685Q
Pennine AIM VCT PLC
30 September 2003
PENNINE AIM VCT PLC
INTERIM STATEMENT FOR THE SIX MONTHS ENDED 31 JULY 2003
CHAIRMAN'S STATEMENT
I am pleased to present the interim statement for the six months ended 31 July
2003.
Net Asset Value
At 31 July 2003, the Company's Ordinary Share Net Asset Value per share (NAV)
stood at 67.73p, a fall of 3.99p or 5.6% since 31 January 2003. The NAV of the
'C' Shares at 31 July 2003 was 94.98p, an increase of 0.48p of the initial value
net of expenses of 94.5p.
Venture capital investments
During the period under review the Company made two new venture capital
investments and one follow-on investment at a total cost of #320,000. At the 31
July 2003 the venture capital portfolio comprised 26 investments with a total
cost of #4.6 million.
Most investments have seen their share price rise over the period, although
there has been one notable exception. The investment in CRC Group, a company
which repairs mobile phones, has suffered from the continuing difficult
conditions in the communications market which has given rise to a decrease in
its valuation of #273,000. The remainder of the venture capital portfolio has
seen an increase of #153,000, giving a net fall in the value of the portfolio of
#120,000.
The Company took advantage of the rising share price in Connaught plc by
disposing of part of the holding and realising a profit of #15,000.
Fixed interest investments
During the period the Company invested #4.8 million in short term listed fixed
income investments, generating an unrealised loss of #10,000.
'C' Share issue
The Offer for Subscription for 'C' Shares closed on 31 July 2003, with the
Company having issued a total of 4,290,649 shares during the period. In total
6,192,483 'C' shares were issued under the Offers with net funds raised of
#5,851,896.
'C' Share conversion
In accordance with terms of the prospectus dated 7 October 2002, your Board has
passed a resolution to convert the 'C' Shares to Ordinary Shares on 31 October
2003. The shares will be converted in the ratio of the NAV attributable to each
'C' Share at 31 July 2003 to the NAV attributable to each Ordinary Share at the
same date. On conversion, the 6,172,483 'C' Shares will automatically be
converted into New Ordinary Shares.
The New Ordinary Shares arising on conversion will be divided amongst the 'C'
Shareholders pro-rata to their respective holdings of 'C' Shares. 'C'
Shareholders will not be allotted fractions of New Ordinary Shares and such
fractions will be aggregated and sold for the benefit of the Company. Income
receivable will be taken into account in the valuation of the 'C' Share asset
pool for the purposes of the Conversion ratio. The ratio of New Ordinary Shares
to 'C' shares is shown below:
1 'C' Share will convert to 1.4023 New Ordinary Shares
The New Ordinary Shares arising as a result of the conversion rank pari passu
with the existing Ordinary Shares. Application will be made to the UK Listing
Authority for admission and to the London Stock Exchange for trading and the
shares are expected to commence trading on 3 November 2003. Definitive share
certificates for the New Ordinary Shares are expected to be dispatched to
shareholders by 14 November 2003.
Results
Gross revenue for the half year was #124,000 (2002: #76,000) and the net revenue
loss after taxation was #17,000 (2002: #3,000). In line with its usual
practice, the Board is not intending to pay an interim dividend.
Repurchase of shares
Your Board is conscious that the Company's share price is affected by the
illiquidity of its shares in the market. This results principally from the
requirement that most shareholders must retain their shares for at least three
years in order to retain their tax benefits. In line with accepted practice for
VCTs, the Company has a policy of purchasing its own shares.
The Company acquired 26,000 Ordinary Shares during the period at an average
price of 56.6p per share.
Outlook
The AIM market in general has shown a good recovery over the period and the FTSE
AIM index has continued to climb since 31 July 2003. As at 31 August 2003 the
Company's NAV stood at 71.0 p per share.
The funds raised through the 'C' Share Offer give the Investment Manager a
significant sum to invest before 28 February 2005. The recent recovery seen by
stock markets should encourage new flotations on AIM and give the Company the
opportunity to build a larger well-balanced portfolio which can capitalise on
the young and developing businesses which AIM attracts. I look forward to
reporting news of the progress made in my statement with the Annual Report to 28
February 2004.
Hugh Gillespie
Chairman
UNAUDITED SUMMARISED BALANCE SHEET
as at 31 July 2003
31 July 31 July 31 Jan
2003 2002 2003
#'000 #'000 #'000
Fixed assets
Investments 7,765 3,718 2,834
Net current assets 837 601 1,864
Net assets 8,602 4,319 4,698
Capital and reserves
Called up share capital 1,021 409
594
Capital redemption reserve 60 53
57
Share premium account 5,233 - 1,607
Special reserve 1,190 3,641
1,235
Capital reserve - realised 1,345 1,941
1,466
Capital reserve - unrealised 31 (1,528)
-
Revenue reserve (278) (197)
(261)
Total equity shareholders' funds 8,602 4,319 4,698
Net asset value per Ordinary share 67.73p 105.56p 71.72p
Net asset value per 'C' share 94.98p - 94.50p
UNAUDITED STATEMENT OF TOTAL RETURN
(incorporating the revenue account)
for the six months ended 31 July 2003
Six months ended
31 July 2003
Revenue Capital Total
#'000 #'000 #'000
Income 124 - 124
Gains/(losses) on investments:
- Realised - 13 13
- Unrealised - (130) (130)
124 (117) 7
Management fees (58) - (58)
Other expenses (83) - (83)
Return on ordinary activities before taxation (17) (117) (134)
Tax on ordinary activities - - -
Return on ordinary activities after taxation (17) (117) (134)
Dividends in respect of non-equity shares - - -
Return attributable to equity shareholders (17) (117) (134)
Distributions in respect of equity shareholders - - -
Transfer from reserves (17) (117) (134)
Return per Ordinary share of 10p (0.39p) (3.67p) (4.06p)
Return per 'C' share of 10p (0.03p) 0.68p 0.65p
Six months ended Year ended
31 Jan
31 July 2002
2003
Revenue Capital Total Total
#'000 #'000 #'000 #'000
Income 76 - 76 123
Gains/(losses) on investments:
- Realised - (9) (9) (41)
- Unrealised - (551) (551) (1,023)
76 (560) (484) (941)
Management fees (37) - (37) (73)
Other expenses (42) - (42) (104)
Return on ordinary activities before taxation (3) (560) (563) (1,118)
Tax on ordinary activities - - - (2)
Return on ordinary activities after taxation (3) (560) (563) (1,120)
Dividends in respect of non-equity shares (11) - (11) (22)
Return attributable to equity shareholders (14) (560) (574) (1,142)
Distributions in respect of equity shareholders - - - (808)
Transfer from reserves (14) (560) (574) (1,950)
Return per Ordinary share of 10p (0.34p) (13.55p) (13.89p) (27.70p)
Return per 'C' share of 10p - - - -
The revenue column of this statement is the profit and loss account of the
Company.
All revenue and capital items in the above statement derive from continuing
operations.
UNAUDITED CASHFLOW STATEMENT
for the six months ended 31 July 2003
Six Six
months months
ended ended Year
ended
31 July 31 July 31 Jan
2003
2003 2002
#'000 #'000 #'000
Cash (outflow)/inflow from operating activities and returns on
investments (Note 1) (81) 30 (36)
Return on investments and servicing of finance Preference
dividends paid - (11) (24)
Taxation - 3 -
Capital expenditure
Purchase of investments (5,122) (116) (141)
Proceeds on disposal of investments 72 916 1,321
Net cash (outflow)/inflow from capital expenditure (5,050) 800 1,180
Equity distributions paid (808) (414) (414)
Net cash (outflow)/inflow before financing (5,939) 408 706
Financing
New share issue 3,920 - 1,941
Purchase of own shares (15) (49) (91)
Net cash inflow/(outflow) from financing 3,905 (49) 1,850
(Decrease)/increase in cash (Note 2) (2,034) 359 2,556
NOTES TO THE CASHFLOW STATEMENT
for the six months ended 31 July 2003
Six Six
months months
ended ended Year
31 July 31 July ended
31 Jan
2003 2002 2003
#'000 #'000 #'000
1 Cash (outflow)/inflow from operating activities and returns on
investments
Net revenue before taxation (17) (3) (54)
(Increase)/decrease in accrued income/other debtors (87) 30 35
Decrease/(increase) in other creditors 23 3 (17)
(81) 30 (36)
2 Analysis of net funds
Beginning of period 2,819 263 263
Net cash (outflow)/inflow (2,034) 359 2,556
End of period 785 622 2,819
SUMMARY OF INVESTMENT PORTFOLIO
as at 31 July 2003
Cost Valuation % of portfolio
#'000 #'000 by value
Ten largest venture capital investments
MacLellan Group plc 171 326 4.2%
CRC Group plc 302 307 3.9%
Scarisbrick Group plc ** 300 296 3.8%
Connaught plc 104 256 3.3%
Forward Media Limited * 300 254 3.3%
Huveaux plc 150 231 3.0%
Aero Inventory plc 65 184 2.4%
VI Group plc 375 154 2.0%
Pubs 'n' Bars plc 199 148 1.9%
XKO Group plc *** 173 108 1.4%
2,139 2,264 29.2%
Other venture capital investments 2,449 709 9.1%
Listed fixed income securities 4,802 4,792 61.7%
Total 9,390 7,765 100.0%
All venture capital investments are quoted on AIM unless otherwise stated.
* Unquoted
** Quoted on the OFEX market
*** Quoted on the London Stock Exchange Main Market
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
1. The above financial information has been prepared on the basis of the
accounting policies set out in the Financial Statements for the year ended 31
January 2003.
2. The Company has only one class of business and derives its income from
investments made in shares, securities and bank deposits.
3. The comparative figures are in respect of the six months ended 31 July 2002
and the year ended 31 January 2003 respectively.
4. The calculation of the revenue and capital return per ordinary share for the
period is based upon the net revenue and capital loss after tax of (#16,000) and
(#128,000) respectively, divided by the weighted average number of shares in
issue during the period of 4,039,967.
5. The calculation of the revenue and capital return per 'C' share for the
period is based upon the net revenue loss after tax of (#1,000) and the net
capital profit after tax of #31,000, divided by the weighted average number of
shares in issue during the period of 4,542,023.
6. The unaudited financial statements set out above do not constitute statutory
accounts within the meaning of Section 240 of the Companies Act 1985 and have
not been delivered to the Registrar of Companies. The figures for the year
ended 31 January 2003 have been extracted from the financial statements for that
year, which have been delivered to the Registrar of Companies; the auditors'
report on those financial statements was unqualified.
7. Copies of the unaudited interim results will be sent to shareholders
shortly. Further copies can be obtained from the Company's Registered Office.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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