TIDMAEV1
RNS Number : 5749H
Acuity Environmental VCT PLC
31 May 2011
Iona Environmental VCT PLC (Formerly Acuity Environmental VCT
Plc) ("the Company" or "the Fund")
Unaudited Half Year Results for the Period Ended 31 March
2011
The figures and financial information in respect of the year
ended 30 September 2011 have been delivered to the Registrar of
Companies and included the Auditors' Report which was
unqualified.
Copies of the Half Yearly Accounts to 31 March 2011 will be sent
to shareholders shortly and will thereafter be available from the
Company's Registered Office.
References in this announcement to Iona Environmental VCT Plc
have been abbreviated to "the Company" or "the Fund". References to
the Investment Manager, Iona Capital Limited, have been abbreviated
to "Iona Capital".
For further information:
Nick Ross, Iona Environmental VCT Plc: 0207 306 3901
Half Year Review Financial Highlights
Six Months Period Ended
Ended
31-March-2011 30-September-2010
Net Assets GBP4.9m GBP4.9m
Net asset value per Ordinary share 88.7p 89.6p
Net asset value per A share 1.8p 2.2p
Total asset value per Ordinary & A Share 90.5p 91.8p
Dividend paid per Ordinary share 0.0p 0.0p
Dividend paid per A share 0.0p 0.0p
Cumulative return to shareholders since
launch
Dividends paid per Ordinary share 0.0p 0.0p
Dividends paid per A share 0.0p 0.0p
Net asset value plus dividends paid per 88.7p 89.6p
Ordinary share
Net asset value plus dividends paid per 1.8p 2.2p
A share
Total asset value per Ordinary & A Share 90.5p 91.8p
Half Year Review Investment Objectives and Strategy
Investment Objectives:
The Company's objective is to maximise tax free capital gains
and income to Shareholders from dividends and capital distributions
by investing the Company's funds in:
-- a portfolio of Qualifying Investments (being investments
which comprise qualifying holdings for a venture capital trust as
defined in Chapter 4 Part 6 of the Income Tax Act 2007), primarily
in UK unquoted companies specialising in in-vessel-composting
("IVC") and anaerobic digestion ("AD") plant operations, or
companies demonstrating similar investment characteristics; and
-- in fixed income funds, securities and cash deposits within
the requirements imposed on venture capital trusts.
Investment Strategy
The Company will seek to invest in investee companies that it
believes are materially de-risked and will provide shareholders
with a reliable source of tax free income. Companies will generally
reflect the following criteria:
-- a well defined business plan and ability to demonstrate
strong demand for its products and services;
-- products or services which are cash generative;
-- objectives of management and shareholders which are similarly
aligned;
-- adequate capital resources or access to further resources to
achieve the targets set out in its business plan;
-- access to high calibre management teams;
-- be companies where the Manager believes there are reasonable
prospects of an exit, either through a trade sale or flotation in
the medium term and
-- gearing; it is not intended the Company will borrow. However,
the Company will retain the power to borrow up to 25% of its net
asset value
Asset Allocation
The Company's investment policy is to focus on investing in
lower risk Qualifying Companies which utilise established
technologies which are supported by commercial supply agreements.
The Company will invest approximately 90% of its funds in
Qualifying Investments. Initially, whilst suitable Qualifying
Investments are being identified, the funds will be invested in a
mixture of fixed income funds, securities and cash deposits, with
an emphasis on capital protection and maximising income yield. Such
Non-Qualifying Investments (being investments made by the Company
which do not qualify as Qualifying Investments) will largely be
made in "A" rated bonds issued by governments of the United
Kingdom, or any other European country, major companies and
institutions or similar "A" rated instruments. Progressively, this
portfolio will be realised in order to fund investments in
Qualifying Investments.
Although under VCT legislation the Company must have 70% of its
funds invested in Qualifying Investments within 3 years, the
Company intends to invest up to 90%. Accordingly, the Company's
maximum exposure to Qualifying Investments will be 90%. The Company
intends to retain its remaining funds in Non-Qualifying Investments
to fund the annual running costs of the Company, to reduce the risk
profile of the overall portfolio of its funds and to make
investments which can be realised to fund any further investments
in its investee companies.
It is expected that after investing 90% of funds raised in
Qualifying Investments, the Company will have at least 6
investments in relation to each fund (assuming full subscription
under the respective offer) to provide appropriate diversification
and risk protection, with a maximum investment in each Qualifying
Investment of GBP2 million in any twelve month period. In any case,
an investee company's gross assets will not exceed GBP7 million
prior to investment to ensure compliance with VCT legislation. In
relation to the Company, no single investment will at the time it
is made represent more than 15% of the aggregate net asset value of
its funds from time to time.
Risk Diversification
The structure of the Company's funds, and its investment
strategy, has been designed to reduce risk as much as possible.
The main risk management features include:
-- portfolio of investee companies - the Company will invest in
at least 6 different companies, thereby reducing the potential
impact of poor performance by any individual investment;
-- establishment of relationships with preferred operating
partners - the Company will establish such relationships to source
a pipeline of IVC and AD plants for investee companies;
-- monitoring of investee companies - the Investment Manager
will closely monitor the performance of all the investments made by
the Company in order to identify any issues and to enable necessary
corrective action to be taken;
-- significant control over investee companies - the Company
will ensure that it has significant influence over the management
of the business of the investee companies, in particular, through
rights contained in the relevant investment agreements and other
shareholder and constitutional documents; and
-- significant proportion of investments in fixed income funds,
securities and cash deposits - a significant proportion of funds
will be invested by the Investment Manager in this way. After the
initial three year period, the objective is to keep approximately
10% of the Company's funds in such investments to reduce the
overall risk profile of each portfolio.
Change in Investment Policy
A material change in the investment policy of the Company will
only be effected with shareholders' approval in accordance with the
Listing Rules.
Half Year Review Chairman's Statement
Overview
I would like to thank you for your patience and to reassure you
that after a slow start your fund is on track to meet its
objectives as set out in the prospectus. In the 2010 Annual Report
and Accounts I explained to Shareholders that the Board was
evaluating the current position of the fund given its small size
and structural changes which were taking place at the Investment
Manager. I undertook to write to you as soon as we had resolved
these problems and accordingly I am now pleased to set-out the
results of these deliberations. After a lengthy period of
consultation the Board decided that it was in the Shareholders'
best interests to continue with the original investment strategy to
invest in Anaerobic Digestion (AD) facilities and In Vessel
Composting (IVC) projects and that, given the strength of the
investment pipeline, the Investment Manager is the best placed to
deliver that strategy. This decision was reinforced by the recent
award of preferred bidder status to BiogenGreenfinch, the leading
AD operator in the UK, for an AD plant in North West Wales. All
being well this will lead to a formal contract for the construction
of the plant which will be part funded by the VCT. These type of
deals being targeted by the Investment Manager entail long term
local authority contracts which are inevitably subject to a lengthy
tendering process. In addition I am pleased to inform you that the
investment Manager has appointed John Kutner, a very experienced
waste industry executive to its investment committee and that Mike
Dunn, the former Managing Director of Shanks PFI Limited has agreed
to join the VCT board as a non executive director. These
appointments will significantly enhance the investment decision
making process and should enable the company to better meet its
investment objectives.
The Board considers that the demand for AD facilities is set to
grow strongly in order to meet the Government's waste recycling
targets and that this fund is well positioned to invest in that
market at attractive rates of return. The Board also recognises
that a slightly broader investment strategy would enable the
Manager to take better advantage of the market opportunity as it
starts to develop. Therefore in view of the investment opportunity,
the investment pipeline and the relatively small size of the fund,
the Board is recommending to Shareholders that additional funds be
raised in the next twelve months and it is also proposing a slight
broadening of the investment mandate, details of which will be set
out in a circular to shareholders.
In recognition that the Investment Manager is now wholly focused
on the waste renewables sector and, along with significant changes
to the composition of the investment team, the Investment Manager
changed its name from Acuity Capital Management Limited to Iona
Capital Limited and the Board is changing the name of the company
to Iona Environmental VCT Plc. In April 2010 the Board and the
Investment Manager waived the directors, administration and
Investment management fee and none of these fees have been charged
for the first 18 months of the life of the fund. In recognition of
the progress in the investment pipeline the Board intends to
reinstate the director and administration fees, the exact timing of
which will depend on the incidence of investments. The Investment
Manager will continue to waive the Investment management fees until
total funds raised exceed GBP8m or the fund is 50% invested in
qualifying investments.
In November 2009 the Company launched the original 2009 Offers,
which to date has raised GBP5.2 million. The Directors and the
Company's Investment Manager now wish to increase the funds
available to the Company. This will enable the Company to make more
investments and allow it to spread its fixed costs over a larger
asset base which will result in economies of scale that will
ultimately increase the Company's profitability to the benefit of
all Shareholders.
The Directors and the Investment Manager believe that the best
way to achieve this goal is by way of an offer of a new class of B
Shares. The money raised from the Offers by the issue of the B
Shares will form a separate pool of capital (as distinct from the
existing capital pool represented by the Ordinary Shares and the A
Shares), that will invest alongside new investments made out of
funds raised from the Company's original 2009 Offers launched in
November 2009. We will be writing to Shareholders shortly with
details of the proposal capital raising offer.
Although the fund has had a slow start considerable progress has
been made with the investment pipeline and the Board anticipates
that a significant proportion of the funds available for investment
will be deployed in the next 12 months. That being the case, this
will enable the Board to initiate the dividend policy.
David Eades
Chairman
31 May 2011
Half Year Review Investment Manager's Review
It has been a period of steady progress and the fund is now
close to completion on a number of long term projects. Chief among
these is the AD project in North West Wales where our partner
BiogenGreenfinch is short listed as the preferred bidder on the
contract. The Welsh Assembly has been in the vanguard of promoting
AD technology for food waste treatment and has gone out to public
tender to build seven AD facilities across the region. The
attraction of these tenders is that they offer long term waste
supply contracts that provide good downside protection on the
contracts. The project in North West Wales is to build a 12,000
tonne facility of which 8,000 tonnes is guaranteed by the local
waste authority. The financing of the project is expected to
complete in the summer with funds being drawn down over the next
six months. The Investment Manager is also supporting bids on four
other Welsh AD tenders two of which are well advanced and are
expected to be on a similar completion timetable to the South West
project. These projects all have similar financial returns and
depending on the exit strategy are capable of delivering an IRR in
excess of 20%. In addition once a plant is fully operational it is
very cash generative and should support the interest coupon and
dividend payments to enable the VCT to pay an attractive rate of
dividends.
Whilst the Investment Manager has established a close
relationship with BiogenGreenfinch it has also been working with
other industry operators and assessing other commercial projects.
The current potential deal pipeline includes over 10 specific AD
projects covering both commercial and municipal food waste. The
majority of the focus to date has been on the waste to energy
opportunity however a number of agricultural schemes which use
animal manure or a crop such as maize as the feedstock are
currently seeking funding. The AD market is therefore expected not
only to see significant growth from the utilisation of organic
municipal and commercial waste but also from the agricultural
market where it originally evolved.
Shareholders may well have been aware of the proposed change in
the Feed in Tariff (FiT) arrangements announced by the Government
at the last Budget. The key point to note on these changes is that
the original fund was launched on the premise that investments in
waste to energy plants would rely on the Renewable Obligation
Certificates (ROC's) mechanism rather than the FiT regime. ROCs's
are a market based pricing mechanism which is designed to encourage
the take up of renewable electricity by the Regional Electricity
Companies. They operate separately from FiT's and are not affected
by the recent Government proposals. Whilst the main impact of the
change in the FiT regime will be felt by the large solar power
projects the Government did stress that it was keen to see a step
up in the use of AD technology and we do not believe that the
change in the FiT regime will impact the VCT's investment
strategy.
In the long term the fund is well positioned as the market for
waste to energy projects is set to grow strongly. The UK Government
has embraced AD technology and is promoting the use of it through
the reduction in the use of landfill, the increase in landfill
taxes and financial incentives for the production of energy from
waste. In addition in March 2011 the Government introduced the
Renewable Hest incentive designed to encourage investment in
renewable energy. Heat generated from a commercial AD facility will
benefit from a 2.6p tariff per KwH. At the time of the announcement
the Secretary of State for the Environment confirmed that renewable
heat, as will be generated in AD plants, is a largely untapped
resource and an important new green industry of the future.
One of the main factors that will influence the growth of the AD
market is the rate of tenders issued by the Local Authorities for
AD facilities. To date the Welsh Assembly and Scottish Parliament
have been actively issuing tenders but the English local
authorities have not yet been as proactive. At a recent conference,
Lord Redesdale, the Chairman of the Anaerobic Digestion and Biogas
Association said that the guidance to local authorities, expected
later this year, will outline how the long-term benefits of local
authority investment in AD plants outweighs the short-to-medium
term procurement costs. Waste is a massive cost for local
authorities at the moment but in the future it could become a
massive asset. The Liberal Democrat peer also pointed out that AD
had the capacity to produce 20% of the UK's domestic gas; the
equivalent of 10% of the UK's generating mix.
Iona Capital Limited
31 May 2011
Current and Future Development
A review of the main features for the six months to 31 March
2011 is contained in the Chairman's Statement and the Investment
Manager's Review on pages 5.
The Board regularly reviews the development and strategic
direction of the Company. The Board's main focus continues to be on
the Company's long-term investment return. Attention is paid to the
integrity and success of an investment process and on factors which
may have an impact on this approach. Due regard is given to the
marketing and promotion of the Company, including effective
communication with shareholders and other external parties.
A detailed review of performance during the six months to 31
March 2011 is contained in the Investment Manager's Review on page
5.
Risk Management
Since the Company is seeking to invest in a particular industry
sector, there is a significant level of in-built risk. There are
also a number of specific risks associated with the investment
strategy of the Company as set out in page 10 of the Prospectus
which include site identification, acquisition and planning
permission risk, construction risk, plant performance and
technology risk, contract risk, electricity price risk, renewable
obligation scheme risk and regulatory risk. These risks could have
a materially negative impact on any investment made by the
Company.
However, to provide a level of diversification, the Company is
restricted to investing no more than 15% of the value of its total
assets at the time of investment in any one individual qualifying
investment or non-qualifying investment. The key risks facing the
Company include Market Risk, Interest Rate Risk, Credit Risk and
Liquidity Risk as further detailed in Note 16 of the Notes to the
Accounts for the period ended 30 September 2010.
In addition the Company is also focused on the following key
risks:
Macroeconomic risks
In addition to the specific risks set out above, the performance
of the Company's underlying investment portfolio is also influenced
by a combination of economic growth, interest rates, the
availability of well-priced debt finance, the number of active
trade and private equity buyers and the general level of merger and
acquisition activity. All of these factors have an impact on the
Company's ability to invest and on the Company's ability to exit
from its underlying portfolio or on the levels of profitability
achieved on exit.
Long-term strategic risk
The Company is subject to the risk that its long-term strategy
and its level of performance fails to meet the expectations of its
shareholders. The Company constantly monitors the level of discount
of its Net Asset Value to the share prices of its Ordinary Shares
and A Shares and considers the most effective methodologies to keep
this at a minimum including a share buy-back policy.
In addition the Company regularly reviews its Objectives and
Investment Strategy in light of prevailing investor sentiment to
ensure the Company remains attractive to its shareholders.
Government policy and regulation risk
The Company carries on business as a VCT under section 274 of
the Income Tax Act 2007. Continuation of this status is subject to
the Company directing its affairs in line with the relevant
requirements of the legislation. Anticipated and actual changes in
government policy and related tax treatment of VCTs' are closely
monitored, as are other changes which could affect results of
operations or financial position.
Iona Capital is an authorised person under the Financial
Services and Markets Act 2000 and regulated by the FSA. Changes to
the regulatory framework under which Iona Capital operates are
closely monitored by Iona Capital and reported upon as necessary by
Iona Capital to the Company.
Investment risks
The Company operates in a very competitive market. Changes in
the number of market participants, the availability of funds within
the market, the pricing of assets, or in the ability of Iona
Capital to access deals on a proprietary basis could have a
significant effect on the Company's competitive position and on the
sustainability of returns.
In order to source and execute good quality investments the
Company is primarily dependent on Iona Capital having the ability
to attract and retain people with the requisite investment
experience and whose compensation is in line with the Company's
objectives.
Once invested, the performance of the Company's portfolio is
dependent upon a range of factors. These include but are not
limited to: (i) the quality of the initial investment decision
described above; (ii) the ability of the investee company to
execute successfully its business strategy; and (iii) actual
outcomes against the key assumptions underlying the investee
company's financial projections. Any one of these factors could
have an impact on the valuation of an investee company and upon the
Company's ability to make a profitable exit from the investment
within the desired timeframe.
A rigorous process is put in place by Iona Capital for managing
the relationship with each investee company for the period to
anticipated realisation. This includes regular asset reviews and,
in many cases, board representation by one of Iona Capital's
executives.
The Company reviews both the performance of Iona Capital and its
incentive arrangements on a regular basis to ensure that both are
appropriate to the objectives of the Company.
Operational risks
The Company's investment management, custody of assets and all
administrative systems are provided or arranged for the Company by
Iona Capital. Therefore, the Company is exposed to a range of
operational risks at Iona Capital which can arise from inadequate
or failed processes, people and systems or from external factors
affecting these.
The Company's system of internal control mainly comprises the
monitoring of the services provided by Iona Capital, including the
operational controls established by them to ensure they meet the
Company's business objectives, as discussed further in the
Corporate Governance Statement on page 14 of the financial
statements for the period ended 30 September 2010.
Responsibility Statement of the Directors in respect of the Half
Yearly Financial Report
We confirm to the best of our knowledge:
-- The condensed set of financial statements has been prepared
in accordance with the Statement Half Yearly Financial Reports
issued by the UK Accounting Standards Board;
-- The Half Yearly Business Review includes a fair review of the
information required by:
(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being
an indication of important events that have occurred during the
first six months of the financial year and their impact on the
condensed set of financial statements; and a description of the
principal risks and uncertainties for the remaining six months of
the year; and
(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being
related party transactions that have taken place in the first six
months of the current financial year and that have materially
affected the financial position or performance of the entity during
that period; and any changes in the related party transactions
described in the last annual report that could do so.
By order of the Board of Directors
D Eades
Chairman
Paternoster House
65 St Pauls Churchyard
London EC4M 8AB
Half Year Review Independent Review Report
Introduction
We have been engaged by the company to review the condensed set
of financial statements in the half-yearly financial report for the
six months ended 31 March 2011, set out on pages 11 to 13. We have
read the other information contained in the half-yearly financial
report and considered whether it contains any apparent
misstatements or material inconsistencies with the information in
the condensed set of financial statements.
This report is made solely to the company in accordance with
guidance contained in the International Standard on Review
Engagements 2410 (UK and Ireland), "Review of Interim Financial
Information Performed by the Independent Auditor of the Entity"
issued by the Auditing Practices Board. To the fullest extent
permitted by law, we do not accept or assume any responsibility to
anyone other than the company, for our work, for this report, or
for the conclusions we have formed.
Directors' Responsibilities
The half-yearly financial report is the responsibility of, and
has been approved by, the directors. The directors are responsible
for preparing the half-yearly financial report in accordance with
the Disclosure and Transparency Rules of the United Kingdom's
Financial Services Authority.
As disclosed in the accounting policies the annual financial
statements of the company are prepared in accordance with UK
Generally Accepted Accounting Practice (UK GAAP). The condensed set
of financial statements included in this half-yearly financial
report has been prepared in accordance with the Statement
"Half-Yearly Financial Reports" issued by the Accounting Standards
Board.
Our Responsibility
Our responsibility is to express to the company a conclusion on
the condensed set of financial statements in the half-yearly
financial report based on our review.
Scope of Review
We conducted our review in accordance with International
Standard on Review Engagements (UK and Ireland) 2410, "Review of
Interim Financial Information Performed by the Independent Auditor
of the Entity" issued by the Auditing Practices Board for use in
the United Kingdom. A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit performed in accordance with International Standards on
Auditing (UK and Ireland) and consequently does not enable us to
obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly we do not
express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that
causes us to believe that the condensed set of financial statements
in the half-yearly financial report for the six months ended 31
March 2011 is not prepared, in all material respects, in accordance
with the Accounting Standards Board Statement "Half-Yearly
Financial Reports" and the Disclosure and Transparency Rules of the
United Kingdom's Financial Services Authority.
Moore Stephens LLP
150 Aldersgate Street, London, EC1A 4AB
31 May 2011
Half Yearly Accounts Income Statement
For the six months 19th October 2009
ended to
30 September
31 March 2011 2010
(unaudited) (Audited)
Revenue Capital Total Revenue Capital Total
Notes GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 3 - 3 9 - 9
3 - 3 9 - 9
Investment
management
fees - - - - - -
Share based
payment 5 - (145) (145) - (148) (148)
Other
expenses (61) - (61) (69) - (69)
(61) (145) (206) (69) (148) (217)
Loss on
Ordinary
Activities
before
interest and
taxation (58) (145) (203) (60) (148) (208)
Tax on loss
on ordinary
activities - - - - - -
Loss on
Ordinary
Activities
after
taxation (58) (145) (203) (60) (148) (208)
Basic and
Diluted
Return to
Shareholders
per Ordinary
Share 2 (1.1p) (2.7p) (3.8p) (2.2p) (5.5p) (7.7p)
Basic and
Diluted
Return to
Shareholders
per A Share 2 (0.0p) (0.1p) (0.1p) (0.1p) (0.1p) (0.2p)
The total column of this statement represents the Company's
Income Statement prepared in accordance with UK GAAP. The revenue
return and capital return columns are supplementary to this and are
prepared under guidance published by the Association of Investment
Companies. All revenue and capital items in the above statement
derive from continuing operations. No operations were acquired or
discontinued in the year. A Statement of Total Recognised Gains and
Losses is not required as all gains and losses of the Company have
been reflected in the above statement.
Half Yearly Accounts Balance Sheet
As at As at
31 March 2011 30/09/2010
(Unaudited) (Audited)
GBP'000 GBP'000
Current Assets
Debtors 41 9
Other Investments - 4,500
Cash at bank 4,898 438
4,939 4,947
Current Liabilities
Creditors: amounts falling due
within one year (42) (70)
(42) (70)
Net Current Assets 4,897 4,877
Total Assets less current liabilities 4,897 4,877
Net Assets 4,897 4,877
Capital and Reserves
Called-up share capital 26 25
Share Premium 4,989 4,912
Capital Reserve - -
Revenue reserve (118) (60)
Total Equity Shareholders' Funds 4,897 4,877
Net Asset Value per Ordinary Share 88.7p 89.6p
Net Asset Value per A Share 1.8p 2.2p
As at 31 March As at 30 September
2011 2010
Number of Ordinary Shares in issue
at end of period 5,345,497 5,268,369
Number of A Shares in issue at end
of period 8,018,246 6,618,367
Half Yearly Accounts Cash Flow Statement
For the six For the period
months ended months ended
30 September
31 March 2011 2010
(Unaudited) (Audited)
GBP'000 GBP'000
Net Cash Outflow from Operating
Activities (107) -
Taxation - -
Corporation tax paid - -
Investing Activities
Purchase of investments - -
Sales of investments - -
Net Cash Outflow from Investing
Activities - -
Equity Dividends Paid - -
--------------------------------- -------- -------------- ---------------
Cash Outflow before Financing (107) -
and Management of Liquid
Resources
Management of Liquid Resources
Realisation/(Investment)
of Liquidity Funds 4,500 (4,500)
Net Cash Inflow/(Outflow)
from Management 4,500 (4,500)
of Liquid Resources
Financing
Issue of Shares 67 5,155
Expenses from the issue
of shares - (217)
Net Cash Inflow from Financing 67 4,938
Increase in Cash for the
Period 4,460 438
--------------------------------- -------- -------------- ---------------
Reconciliation of Net Revenue on Ordinary Activities Before
Taxation to Net Cash Outflow from Operating Activities
----------------------------------------------------------------------------
As at 31 March
2011
GBP'000
--------------------------------- -------- -------------- ---------------
Return on ordinary activities
before
finance costs and taxation (203)
Share based payments 145
Increase in debtors (32)
Increase/(decrease) in
creditors and accruals (17)
Net cash outflow from operating
activities (107)
--------------------------------- -------- -------------- ---------------
Analysis of Changes in
Net Funds
--------------------------------- -------- -------------- ---------------
Liquidity
Cash Funds Total
GBP'000 GBP'000 GBP'000
--------------------------------- -------- -------------- ---------------
At beginning of period 438 4,500 4,938
Net cash inflow/(outflow) 4,460 (4,500) (40)
--------------------------------- -------- -------------- ---------------
At end of period 4,898 - 4,898
--------------------------------- -------- -------------- ---------------
Half Yearly Accounts Reconciliation
of Movements in Shareholders'
Funds
For the six For the period
months ended months ended
30 September
31 March 2011 2010
(unaudited) (Audited)
GBP'000 GBP'000
Total Return on ordinary activities
after taxation (203) (208)
Issue of new shares 78 5,282
Share issue expenses - (345)
Share based payment 145 148
Movements in Total Shareholders'
Funds 20 4,877
Total Shareholders Funds as
at 1 October 2010 4,877 -
------------------------------------- -------------- ---------------
Total Shareholders' Funds at
the end of the period 4,897 4,877
------------------------------------- -------------- ---------------
Half Yearly Accounts Notes to the Accounts
1 Accounting Policies
The principal accounting policies remain unchanged
from the year ended 30 September 2010.
2 Return per Share
Ordinary Shares A Shares
-------------------------------- --------- ---------------- ------------------
Revenue return per share based
on:
Net revenue after taxation
(GBP'000) (56) (2)
---------------- ------------------
Weighted average number of
shares in issue 5,319,929 7,554,198
---------------- ------------------
Pence per Ordinary Share/A
Share (1.1) (0.0)
---------------- ------------------
Capital return per share based
on:
Net capital gain/(loss) for the
financial year (GBP'000) (141) (4)
---------------- ------------------
Weighted average number of
shares in issue 5,319,929 7,554,198
---------------- ------------------
Pence per Ordinary Share/A
Share (2.7) (0.1)
---------------- ------------------
3 Dividends
No dividends have been proposed
or paid in the period
4 Going Concern
After making enquires, and bearing in mind the nature of the Company's
business and assets, the Directors consider that the Company has adequate
resources to continue in operational existence for the foreseeable
future. In arriving at this conclusion the Directors have considered
the liquidity of the Company and its ability to meet its obligations
as they fall due for a period of at least twelve months from the date
that these financial statement were approved. As at the 31 March 2011
the Company held cash balances with a combined value of GBP4.9 Million.
5 Incentive Scheme
To give effect to a Performance Incentive, each investor received one Ordinary
Share and one A Share at the subscription prices of 99.9p for each
Ordinary share and 0.1p for each A Share. At the close of the Offer, the
Management owned 20% of the issued A Shares in the share capital of the
Company, with a further 13% allotted on the 25 November 2010, therefore
holding a third of all A Shares in issue, which vested on allocation. Subject
to the achievement of the Hurdle, being a Performance Value of at least
120p per share and the payment of Shareholder Proceeds of at least 20p
per share, the Management A Shareholders will receive 1% of the first 20p
of Shareholder Proceeds and 20% of Shareholder Proceeds thereafter.
The holders of A Shares will be entitled to distributions equivalent to
three times the Performance Incentive. 2/3 of the distributions in respect
of the
A Shares will be allocated to Shareholders and 1/3 to the Management, which
will result in Management receiving the level of Performance as described
above.
Share Based Payment
For the period
ended
31 March 2011
Revenue Capital Total
GBP'000 GBP'000 GBP'000
Share Based Payment - 145 145
-------------------------------- ------------- ---------------- ------------------
The above is an estimate of the fair value of 1,322,749 management
A Shares on the date of grant, giving a share based payment charge
of 10.9p
per share. No amount has been paid to management and it is not estimated
that any performance fees will be made to management.
Half Yearly Accounts Contact Details
Board of Directors
David Eades (Chairman)
Michael Dunn
Philip Ling
Investment Manager and Administrator
Iona Capital Limited
Paternoster House
65 St Paul's Churchyard
London EC4M 8AB
Telephone: +44 (0)207 306 3901
Web: www.Ionacapital.co.uk
Enquiries: info@Ionacapital.co.uk
Secretary and Registered Office
Iona Capital Limited
Paternoster House
65 St Paul's Churchyard
London EC4M 8AB
Telephone: +44 (0)20 7306 3901
Company Number
07049290
Registered Independent Auditors
Moore Stephens LLP
150 Aldersgate Street,
London, EC1A 4AB
Telephone: +44 (0) 207 334 9191
Registrar and Transfer Office
The City Partnership (UK) Limited
Thistle House
21 Thistle Street
Edinburgh EH2 1DF
Telephone (UK): 0131 220 8226
Telephone (Overseas): +44 131 220 8226
Any change of address of a shareholder or other relevant
amendment to shareholder details should be communicated to the
Company's Registrar, The City Partnership (UK) Limited
This information is provided by RNS
The company news service from the London Stock Exchange
END
IR WGUMPAUPGGWG
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