RNS Number:1654D
British Smaller Tech Cos VCT PLC
21 September 2004
21 September 2004
BRITISH SMALLER TECHNOLOGY COMPANIES VCT PLC
Unaudited preliminary results for the 6 months to 30 June 2004
* Successful flotation of Amino Technologies plc
* One further flotation and one trade sale since period end
* 15.8% increase in net asset value
British Smaller Technology Companies VCT plc ("the Company"), the venture
capital trust specialising in growing smaller technology companies across a
range of industrial sectors, today announces its unaudited preliminary results
for the six months to 30 June 2004.
Financial Highlights:
Unaudited Unaudited Audited
six months six months year
ended ended ended
30 June 30 June 31 December
2004 2003 2003
Gross revenue #12,000 #38,000 #88,000
Net revenue loss before and after tax #(211,000) #(205,000) #(432,000)
Revenue return per share (1.53)p (1.49)p (3.14)p
Total return #1,280,000 #392,000 #(1,243,000)
Total return per share 9.31p 2.85p (9.04)p
Net assets #6.94m #7.62m #5.99m
Net asset value per share 50.5p 55.4p 43.6p
Announcing the results, the Chairman, Sir Andrew Hugh Smith, reported that the
last six months has seen some return of confidence in the technology sector and
the Board remain cautiously optimistic about the portfolio's performance in the
second half of the year.
Investments
On 9 June 2004, Amino Technologies plc was successfully admitted to AIM. The
shares were quoted at 120 pence per share and, by 30 June 2004, had risen to a
bid price value of 136 pence per share. Since that date the share price has
continued to rise.
Following the period end, on 26 July, another of the Company's investments,
Cozart plc, was admitted to AIM. This too has proved successful with the shares
trading at a significant premium to the listing price of 30 pence per share.
Very recently, the trade sale of Voxar Limited to Belgium based Barco N.V.
completed. The consideration, which includes an element of deferred proceeds,
was slightly in excess of book value at 30 June 2004.
Financial Results
Commenting on the financial results, Sir Andrew said, "It is encouraging to be
able to report an increase in total return since the last year end of 9.31 pence
per share and the recovery of the net asset value to 50.5 pence per share."
This represents an increase of 15.8% in the six month period. The increase on
capital account, arising mainly on the revaluation of the investment portfolio,
was 10.84 pence per share.
Shareholder Relations
With Shareholder approval now in place, Sir Andrew said that the Company will
seek to buy back a limited number of shares where the directors determine it is
in the best interests of the remaining Shareholders to do so. A total of 6,666
shares were bought back in the period. He referred to the success of the
Shareholder workshops run by Yorkshire Fund Managers Limited, the Company's
Investment Adviser, and the Board's commitment to their continuation.
Sir Andrew said that, since the period end, the Board had taken the decision for
the Company to revoke investment company status in the near future. Referring to
the advantages to Shareholders, he said, "This will enable the Company to
distribute realised capital profits in the form of tax free dividends."
Outlook
Commenting on the outlook for the remainder of 2004, Sir Andrew said, "Whilst
there remain some uncertainties in the international economic and political
outlook, we are pleased with the improving performance of the portfolio. The
current overall trading results of your Company's investments provide
encouragement for the remainder of this financial year.
For further information, please contact:
Alan Davies, Yorkshire Fund Managers Limited Tel: 0113 294 5027
David Hall, Yorkshire Fund Managers Limited Tel: 0161 832 7603
Keith Williams, Brewin Dolphin Securities Limited Tel: 0113 241 0130
Chairman's Statement
The period has seen some return of confidence in the technology sector. This has
been reflected to some extent in the rise in activity in the IPO market and in
the rising number of corporate transactions. Whilst there are some signs of
fragility in this confidence and possibly a slowdown in IPO activity in the next
six months, the Board remains cautiously optimistic about the performance of the
portfolio for the rest of the year.
The net asset value, which suffered in the second half of last year, has risen
from 43.6 pence per share at 31 December 2003 to 50.5 pence per share at 30 June
2004. This represents an increase of 15.8% in the six month period. It is of
particular note that this increase has resulted, in large part, from one of the
investments, Amino Technologies plc, being successfully admitted to AIM in the
period. Another, Cozart plc, followed on 26 July. To date, both companies have
continued to trade at levels significantly above those at which they were
listed.
Although the last few years, following the bursting of the technology bubble,
have provided difficult challenges for technology related funds, the current
trading performance of a number of the investments held by your Company is
encouraging.
Operations
Your Board's and its Investment Adviser's focus on the development of those
businesses that have demonstrated the potential for significant growth has begun
to produce some positive results, particularly following the flotation of Amino
Technologies and Cozart.
During the period a further #115,000 was invested in Vibration Technology
Limited. This investment continues to demonstrate an increasing level of sales
activity.
Since the period end, the trade sale of Voxar Limited to Barco N.V., a Belgium
based multinational company, was completed on 15 September. The total cash
consideration receivable by your Company is #829,000 of which #87,000 is
contingent upon certain conditions being met. The cost to your Company of this
investment was #745,000 and its carrying value at the end of the reporting
period was #819,000.
Financial Results
It is encouraging to be able to report an increase in total return since the
last year end of 9.31 pence per share and the recovery of the net asset value to
50.5 pence per share. This resulted from an increase on capital account of 10.84
pence per share and a loss on revenue account of 1.53 pence per share. The
increase on capital account has been arrived at, in the main, from the upward
revaluation of a number of companies within the portfolio. In particular the
performances of Voxar Limited, Cozart plc and Amino Technologies plc have
resulted in significant upward valuations. The loss on revenue account
represents the amount by which the costs of managing the portfolio exceed the
Company's income.
Shareholder Relations
With the necessary procedures now in place to enable the Company to purchase its
own shares, a total of 6,666 shares were bought back, and cancelled. The Company
will continue to use the existing authority to seek to buy back a limited number
of shares in the market where the directors determine it is in the best
interests of Shareholders as a whole to do so.
2004 was the last year in which Warrants could be exercised. I can now report
that a total of 9,800 Ordinary shares were allotted during the period as a
consequence of Shareholders exercising their options. All outstanding Warrants
have now lapsed.
In April, your Board's Investment Adviser, Yorkshire Fund Managers Limited
(YFM), held an investor workshop at the British Museum in London. Over 100
Shareholders from across the three VCTs managed by YFM attended, making this the
most successful workshop to date. It has become clear that this provides an
excellent forum for updating Shareholders on recent developments in both the
Company and the industry and to informally discuss the portfolio with the
directors and Investment Adviser. Another workshop is planned later in the year
for Manchester, with further events next year in Birmingham and London.
Following the period end, your Board has taken the decision that the Company
should revoke investment company status in the near future and this is being
kept under review. This action, when taken, will enable the Company to
distribute realised capital profits in the form of tax free dividends.
Outlook
Whilst there remain some uncertainties in the international economic and
political outlook, we are pleased with the improving performance of the
portfolio. The current overall trading results of your Company's investments
provide encouragement for the remainder of this financial year.
Sir Andrew Hugh Smith
21 September 2004
Statement Of Total Return
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2004 2003 2003
#000 #000 #000
Notes
Revenue
Gross revenue 12 38 88
Administrative expenses 2 (223) (243) (520)
Taxation 3 - - -
------ ------ ------
(211) (205) (432)
Capital
Realised (losses) gains (net) (144) 25 37
Unrealised gains (losses) net 1,301 638 (717)
Other capital movements 334 - -
Management fee allocated to capital 2 - (66) (131)
------ ------ ------
1,491 597 (811)
Total return 1,280 392 (1,243)
====== ====== ======
Appropriated:
Revenue
Transfer from revenue reserve (211) (205) (432)
------ ------ ------
Capital
Increase (decrease) on reserves 1,491 597 (811)
------ ------ ------
Basic and diluted return per
Ordinary share
Revenue (1.53)p (1.49)p (3.14)p
Capital 10.84p 4.34p (5.90)p
------ ------ ------
4 9.31p 2.85p (9.04)p
====== ====== ======
Notes
The revenue section of this statement is the profit and loss account of the
Company.
All activity has arisen from continuing operations.
Balance Sheet
Notes Unaudited Unaudited Audited
30 June 30 June 31 December
2004 2003 2003
#000 #000 #000
Fixed assets
Investment portfolio 6,442 6,771 5,445
------ ------ ------
Current assets
Debtors 99 131 24
Short-term investments 340 814 534
Cash and short term deposits 157 61 19
------ ------ ------
596 1,006 577
Creditors: amounts payable within
one year (96) (154) (34)
------ ------ ------
Net current assets 500 852 543
------ ------ ------
Total net assets 6,942 7,623 5,988
====== ====== ======
Capital and reserves
Called-up share capital 1,375 1,375 1,375
Capital redemption reserve 2 2 2
Share premium account 10 11,354 11,354
Special reserve 11,354 - -
Capital reserve (4,662) (4,745) (6,153)
Warrant reserve - 336 335
Other reserve 2 2 3
Revenue reserve (1,139) (701) (928)
------ ------ ------
Equity Shareholders' funds 6,942 7,623 5,988
====== ====== ======
Net asset value per Ordinary share 5 50.5p 55.4p 43.6p
Summarised Cash Flow Statement
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2004 2003 2003
#000 #000 #000
Net cash outflow from operating activities (224) (245) (550)
Financial investment 161 (238) (247)
------ ------ ------
Net cash outflow before management of
liquid resources and financing (63) (483) (797)
Management of liquid resources 193 470 742
------ ------ ------
Net cash inflow (outflow) before financing 130 (13) (55)
Financing 8 3 3
------ ------ ------
Increase (decrease) in cash 138 (10) (52)
------ ------ ------
Notes to the Financial Statements
1. The interim financial statements have been prepared on a basis consistent
with the statutory financial statements for the year ended 31 December 2003. The
interim financial statements, which have been approved by the directors, are
unaudited and do not constitute full financial statements as defined in section
240 of the Companies Act 1985. The comparitive figures for the year ended 31
December 2003 do not constitute full financial statements and have been
extracted from the Company's financial statements for the year ended 31 December
2003 which have been reported upon without qualification by the auditors and
have been delivered to the Registrar of Companies.
2. In accordance with the accounting policies as set out in the last Annual
Report, as a result of the reduction in the Investment Advisory fee, all such
costs have been allocated to the Revenue account in the current period.
3. Taxation charge
Unaudited Unaudited Audited
6 months 6 months Year
ended ended ended
30 June 30 June 31 December
2004 2003 2003
#000 #000 #000
Return/loss on ordinary activities
multiplied by standard small company rate
of corporation tax in the UK of 19% (2003:19%) 180 74 (236)
Effect of:
Non taxable (gains) losses on investments(i) (220) (126) 129
Movement in excess management expenses (ii) 40 52 107
------ ------ ------
Current tax charge for period - - -
------ ------ ------
(i)Venture Capital Trusts are not subject to corporation tax on these items
(ii)The Company has no deferred tax liability
Deferred tax assets in respect of losses have not been recognised as management
do not currently believe that it is more likely than not sufficient taxable
profits will be available against which the assets can be recovered.
Due to the Company's status as a venture capital trust, and the continued
intention to meet the conditions required to comply with Section 842AA of the
Income and Corporation Taxes Act 1988, the Company has not provided deferred tax
on any capital gains and losses on the revaluation or disposal of investments.
4. The basic revenue return per share is based on net loss from ordinary
activities after tax attributed to Shareholders of #211,000 (30 June 2003: net
loss #205,000 and 31 December 2003: net loss #432,000) and on 13,752,000 shares
(30 June 2003: 13,747,000 and 31 December 2003: 13,748,000), being the weighted
average number of shares in issue during the period. The Company has no
securities that would have a dilutive effect and hence basic and diluted return
per share are the same.
5. The net asset value per Ordinary share is calculated on attributable assets
of #6,942,000 and 13,752,000 shares in issue at the period end (30 June 2003:
assets of #7,623,000 and 13,748,000 shares, 31 December 2003: assets of
#5,988,000 and 13,748,000 shares).
6. Copies of the interim report can be obtained from the Company's registered
office: Saint Martins House, 210-212 Chapeltown Road, Leeds, LS7 4HZ thereafter.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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