TIDMCR5
Core VCT V PLC
From: Core VCT V PLC
Date: 23 August 2012
Half-Yearly Financial Report for the six months ended 30 June 2012
Performance Summary
Ordinary Shares 30 June 2012 30 June 2011 31 December 2011
Net asset value per share 55.03 pence 81.29 pence 61.14 pence
Total return to date per share(1) 72.53 pence 88.79 pence 78.64 pence
Share price (mid market) 34.00 pence 41.50 pence 45.00 pence
Expense ratio(2) 0.96% 0.70% 2.24%
1. Total return per share comprises closing net asset value per share plus
cumulative dividends per share paid to date.
2. Operating expenses of the Group, excluding trail commission, third party
transaction costs and costs associated with the corporate proposal, as a
percentage of closing net assets.
Chairman's Statement
Results
In the six months to 30 June 2012, the Net Asset Value (NAV) Total Return per
Ordinary Share was 72.53p, comprising a NAV of 55.03p and cumulative dividends
paid of 17.50p per Ordinary Share. This represents a decrease from the
Combined NAV Total Return to 31 December 2011 of 7.8%, (6.11p) per Ordinary
Share. The main contributor to the fall was in respect of the valuation of
our investment in Allied International Holdings Limited due to
underperformance.
Investments
Allied International Holdings Limited, an investment directly held by Core VCT
V plc, required further funding to progress with its turnaround plan. Both
Core VCT V plc and Core VCT IV plc did not participate in the further funding
due to their cash constraints and GBP350,000 was provided by Core VCT plc, by
way of a loan to provide preference on the capital. The valuation reduced by
GBP661,000 (6.0p per Ordinary Share) due to weaker trading, particularly in
their European destinations' business. Certain internal steps are being taken
to address issues in the business that should enable Allied to grow
organically from this base. We continue to believe that Allied has the
potential to grow into a major global operation over the medium term. Further
funds of GBP350,000 have been allocated by Core VCT to ensure this business has
adequate capital available.
During the period, a further GBP3.5 million was drawn down from institutional
investors in Core Capital I LP for Abriand, which has now received its full
GBP20.2 million commitment from the Fund. This has been utilised to fund capital
expenditure and the acquisition of the Chez Gerard sites from the
administrator of Paramount Restaurants. Abriand is well advanced in the
conversion and integration of these new sites. The remaining GBP9.8 million to
be called (net of General Partner Fee) is intended to be deployed in Ark Home
Healthcare Limited, Colway Limited and SPL Services Limited.
Dividends
During the six months to 30 June 2012, the Group generated a loss of GBP673,235
and is therefore not in a position to pay an interim dividend to shareholders.
Share Price and Share Buy Backs
We would remind shareholders that we view the NAV Total Return, rather than
the share price, as the preferred measure of performance, as it encompasses
the value of the current portfolio and the amount of cash distributed to
shareholders over the life of their investment. It is disappointing to report
that the NAV Total Return has fallen by 7.8% over the period. However, we
believe that the underlying portfolio performance will improve as we start to
see the benefits from deploying the substantial capital raised last year from
Core Capital I LP, and as our largest directly held investment, Allied, makes
the progress we expect.
We are conscious that the mid price of the shares continues to be at a
significant discount to the NAV (38% at 30 June 2012). Whilst the Company has
the ability to buy back its own shares, the Boards' view is that any surplus
cash should be returned to all shareholders by way of a distribution.
Outlook
The outlook for the UK economy remains subdued and uncertain. Against this
backdrop, it is encouraging that the level of debt in our underlying portfolio
is relatively low, where necessary management teams have been strengthened and
close monitoring of trading performance continues. Together with the further
capital that has either recently been invested or remains available, our
largest companies in particular are well placed to deliver growth. Your Board
and Manager are working towards creating value and seeking realisations for
our shareholders over the medium term.
Greg Aldridge
Chairman
23 August 2012
Principal Risks and Uncertainties
The Company's assets consist of unquoted investments, cash and liquid
resources. Its principal risks are therefore market risk and liquidity risk.
Other risks faced by the Company include economic risks, the loss of approval
as a Venture Capital Trust, failure to comply with other regulatory
requirements, and broader risks such as reputational, operational and
financial risks. These risks, and the way in which they are managed, are
described in more detail in the Annual Report for the year ended 31 December
2011, in note 17 to the accounts. The Company's principal risks and
uncertainties have not changed materially since the date of that report and it
is not envisaged that there will be any changes to the risks and uncertainties
in the remaining six months of the financial year.
Related Party Transactions
Details of related party transactions in accordance with the Disclosure and
Transparency rule 4.2.8 can be found in Note 8 to the Accounts on page 12.
Responsibility Statement
The Directors confirm that to the best of their knowledge:
(a) the summarised set of financial statements have been prepared in
accordance with IAS 34 'Interim Financial Reporting';
(b) interim management report includes a fair review of the information
required by DTR 4.2.7R
(indication of important events during the first six months and
description of principal risks and
uncertainties for the remaining six months of the year);
(c) the summarised set of financial statements gives a true and fair view of
the assets, liabilities and
financial position and profit and loss of the Company as required by DTR
4.2.4R; and
(d) the interim management report includes a fair review of the information
required by DTR 4.2.8R
(disclosure of related parties' transactions and charges therein)
For and behalf of the Board:
Greg Aldridge
Chairman
23 August 2012
Unaudited Consolidated Statement of Comprehensive Income
For the Six Months ended 30 June 2012
Revenue Capital Total
Return Return
Notes GBP GBP GBP
=------------------------------------------------------------------------------
Capital losses on investments
Losses on investments held at fair value 6 - (677,030) (677,030)
=------------------------------------------------------------------------------
- (677,030) (677,030)
Revenue
Investment Income 3 77,513 - 77,513
Other Income 3 142 - 142
=------------------------------------------------------------------------------
Total Income 77,655 (677,030) (599,375)
=------------------------------------------------------------------------------
Expenditure
Other expenses (73,860) - (73,860)
=------------------------------------------------------------------------------
Total expenditure (73,860) - (73,860)
=------------------------------------------------------------------------------
Profit/(loss) before taxation 3,795 (677,030) (673,235)
Taxation - - -
=------------------------------------------------------------------------------
Profit/(loss) for period/total
comprehensive income 5 3,795 (677,030) (673,235)
=------------------------------------------------------------------------------
Return per ordinary share (pence): 5 0.03 (6.14) (6.11)
Unaudited Consolidated Statement of Comprehensive Income
For the Six Months ended 30 June 2011
Revenue Capital Total
Return Return
Notes GBP GBP GBP
=------------------------------------------------------------------------------
Capital losses on investments
Losses on investments held at fair value - (815,014) (815,014)
=------------------------------------------------------------------------------
- (815,014) (815,014)
Revenue
Investment Income 3 105,808 - 105,808
Other Income 3 2,274 - 2,274
=------------------------------------------------------------------------------
Total Income 108,082 (815,014) (706,932)
=------------------------------------------------------------------------------
Expenditure
Other expenses (88,642) (88,014) (176,656)
=------------------------------------------------------------------------------
Total expenditure (88,642) (88,014) (176,656)
=------------------------------------------------------------------------------
Profit/(loss) before taxation 19,440 (903,028) (883,588)
Taxation - - -
=------------------------------------------------------------------------------
Profit/(loss) for period/total
comprehensive income 5 19,440 (903,028) (883,588)
=------------------------------------------------------------------------------
Return per ordinary share (pence): 5 0.18 (8.19) (8.01)
Audited Consolidated Statement of Comprehensive Income
for the year ended 31 December 2011
Revenue Capital Total
Return Return
Notes GBP GBP GBP
=------------------------------------------------------------------------------
Capital losses on investments
Losses on investments held at fair
value - (1,897,346) (1,897,346)
=------------------------------------------------------------------------------
- (1,897,346) (1,897,346)
Revenue
Investment Income 3 182,659 - 182,659
Other Income 3 2,424 - 2,424
=------------------------------------------------------------------------------
Total Income 185,083 (1,897,346) (1,712,263)
=------------------------------------------------------------------------------
Expenditure
Other expenses (205,240) (85,575) (290,815)
=------------------------------------------------------------------------------
Total expenditure (205,240) (85,575) (290,815)
=------------------------------------------------------------------------------
Loss before taxation (20,157) (1,982,921) (2,003,078)
Taxation - - -
=------------------------------------------------------------------------------
Loss for year/total comprehensive
income 5 (20,157) (1,982,921) (2,003,078)
=------------------------------------------------------------------------------
Return per ordinary share (pence): 5 (0.18) (17.99) (18.17)
Consolidated Balance Sheet
As at As at As at
30 June 2012 30 June 2011 31 December 2011
Notes (unaudited) (unaudited) (audited)
GBP GBP GBP
Non-current assets
Investments at fair value 6 5,648,872 7,660,733 6,325,902
-------------------------------------------
Current assets
Other receivables 45,786 63,302 42,312
Cash 409,203 1,469,472 462,019
-------------------------------------------
454,989 1,532,774 504,331
Current liabilities
Other payables (36,509) (230,933) (89,646)
-------------------------------------------
Net current assets 418,480 1,301,841 414,685
-------------------------------------------
Net assets 6,067,352 8,962,574 6,740,587
-------------------------------------------
Capital and reserves
Called-up Ordinary share 1,102 1,102 1,102
capital
Capital reserve (2,704,568) (947,645) (2,027,538)
Special distributable reserve 8,751,749 9,854,246 8,751,749
Revenue reserve 19,069 54,871 15,274
-------------------------------------------
Shareholders' funds 7 6,067,352 8,962,574 6,740,587
-------------------------------------------
Net asset value per 0.01p 7 55.03p 81.29p 61.14p
ordinary share
Consolidated Statement of Changes in Equity
As at 30 June 2012
Called up
Ordinary Special
Share Capital Distributable Revenue
Capital Reserve Reserve Reserve Total
GBP GBP GBP GBP GBP
For the six months ended
30 June 2012 (unaudited)
Net assets at 1 January 1,102 (2,027,538) 8,751,749 15,274 6,740,587
2012
(Loss)/profit for the
period/total
comprehensive income - (677,030) - 3,795 (673,235)
------------------------------------------------------
Net assets at 30 June 1,102 (2,704,568) 8,751,749 19,069 6,067,352
2012
------------------------------------------------------
Called up
Ordinary Special
Share Capital Distributable Revenue
Capital Reserve Reserve Reserve Total
GBP GBP GBP GBP GBP
For the six months ended
30 June 2011 (unaudited)
Net assets at 1 January 1,102 (44,617) 9,854,246 35,431 9,846,162
2011
(Loss)/profit for the
period/total comprehensive
income - (903,028) - 19,440 (883,588)
----------------------------------------------------
Net assets at 30 June 2011 1,102 (947,645) 9,854,246 54,871 8,962,574
----------------------------------------------------
Called up
Ordinary Special
Share Capital Distributable Revenue
capital Reserve Reserve Reserve Total
GBP GBP GBP GBP GBP
For the year ended
31 December 2011
(audited)
Net assets at 1 1,102 (44,617) 9,854,246 35,431 9,846,162
January 2011
Loss for the
year/total
comprehensive income - (1,982,921) - (20,157) (2,003,078)
Dividends paid - - (1,102,497) - (1,102,497)
---------------------------------------------------------
Net assets at 31 1,102 (2,027,538) 8,751,749 15,274 6,740,587
December 2011
---------------------------------------------------------
Consolidated Cash Flow Statement
for the six months ended 30 June 2012
As at As at As at
30 Jun 2012 30 Jun 2011 31 Dec 2011
(unaudited) (unaudited) (audited)
GBP GBP GBP
=------------------------------------------------------------------------------
Net cash (outflow)/inflow from operating
activities (52,816) 340,285 435,329
Financing activities
Equity dividends paid - - (1,102,497)
=------------------------------------------------------------------------------
Net cash outflow from financing activities - - (1,102,497)
Net (decrease)/increase in cash and cash
equivalents (52,816) 340,285 (667,168)
Cash and cash equivalents at beginning of
period 462,019 1,129,187 1,129,187
=------------------------------------------------------------------------------
Cash and cash equivalents at the end of
period 409,203 1,469,472 462,019
=------------------------------------------------------------------------------
Reconciliation of loss before taxation to
net cash (outflow)/inflow from operating
activities
Loss before taxation (673,235) (883,588) (2,003,078)
Losses on investments 677,030 815,014 1,897,346
Purchases of investments - (55,888) (3,496,845)
Sales of investments - 425,000 4,004,904
(Increase)/decrease in accrued income and
prepayments (3,474) 476 21,466
(Decrease)/increase in other payables (53,137) 39,271 11,936
=------------------------------------------------------------------------------
Net cash (outflow)/inflow from operating
activities (52,816) 340,285 435,329
=------------------------------------------------------------------------------
Notes:
1. The unaudited interim results have been prepared on the basis of the
accounting policies set out in the statutory accounts of the Company for
the year ended 31 December 2011 and in accordance with International
Accounting Standards ('IAS') 34. Unquoted investments have been valued in
accordance with IPEVC guidelines. These statements have been prepared on a
going concern basis and nothing has happened that would change the
Directors' going concern assessment from the last audited financial
statements to 31 December 2011. In arriving at this conclusion the
Directors have considered the liquidity of the Company and its ability to
meet obligations as they fall due for a period of twelve months from the
date these financial statements were approved. At 30 June 2012, the
Company held cash balances of GBP0.4 million. Cashflow projections have been
reviewed and show that the Company has sufficient funds to meet its
contracted expenditure.
2. Earnings for the six months should not be taken as a guide to the results
of the financial year to 31 December 2012.
3. Income
As at As at As at
30 Jun 2012 30 Jun 2011 31 Dec 2011
(unaudited) (unaudited) (audited)
GBP GBP GBP
Investment Income 77,513 105,808 182,659
Other Income
Deposit interest 142 2,274 2,424
------------------------------------------
77,655 108,082 185,083
------------------------------------------
4. Taxation
There will be no tax charge due by the Company since total expenses
(including fees allocated to capital) are expected to be more than income.
5. Earnings and return per share
As at As at As at
30 Jun 2012 30 Jun 2011 31 Dec 2011
(unaudited) (unaudited) (audited)
GBP GBP GBP
(i) Basic return from ordinary
activities after taxation (673,235) (883,588) (2,003,078)
Basic return per share (6.11)p (8.01)p (18.17)p
(ii) Net revenue return from ordinary
activities after taxation 3,795 19,440 (20,157)
Revenue return per share 0.03p 0.18p (0.18)p
(iii) Net capital return from ordinary
activities after taxation (677,030) (903,028) (1,982,921)
Capital return per share (6.14)p (8.19)p (17.99)p
(iv) Weighted average number of ordinary
shares in issue in the period 11,024,969 11,024,969 11,024,969
6. Investments
Unlisted
Level 3 Total
GBP GBP
Valuation at 31 December 2011 6,325,902 6,325,902
Investment holding losses (677,030) (677,030)
------------- ------------
Valuation at 30 June 2012 5,648,872 5,648,872
------------- ------------
Book cost at 30 June 2012 6,315,403 6,315,403
Investment holding losses at 30 June 2012 (666,531) (666,531)
------------- ------------
Valuation as at 30 June 2012 5,648,872 5,648,872
------------- ------------
7. Net asset value
As at As at As at
30 Jun 2012 30 Jun 2011 31 Dec 2011
(unaudited) (unaudited) (audited)
GBP GBP GBP
Net assets 6,067,352 8,962,574 6,740,587
Number of shares in issue 11,024,969 11,024,969 11,024,969
Net asset value per share 55.03p 81.29p 61.14p
8. Related Party Transaction
Details of the carried interest arrangements between the Company and the
Manager are set out in the Annual Report for the year ended 31 December
2011. Following the launch of Core Capital I LP, the general partner of
the LP, will receive GBP750,000 per annum until the fourth anniversary,
payable out of the assets of Core Capital I LP.
9. The financial information for the six months ended 30 June 2012 and 30
June 2011 has not been audited.
10. These are not statutory accounts in terms of Section 434 of the Companies
Act 2006. Statutory accounts for the year to 31 December 2011, which
received an unqualified audit report and did not contain a statement under
sections 498(2) or (3) of the Companies Act 2006, have been lodged with
the Registrar of Companies. No statutory accounts in respect of any period
after 31 December 2011 have been reported on by the Company's auditors or
delivered to the Registrar of Companies.
11. Copies of this statement are being sent to all shareholders. Further
copies are available free of charge from the Company's registered office,
9 South Street, London, W1K 2XA.
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: Core VCT V plc via Thomson Reuters ONE
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