TIDMD1GO
Downing Planned Exit VCT 2011 plc
Second Half-Yearly Report for the twelve months ended 30 November 2014
FINANCIAL HIGHLIGHTS
30 Nov 30 Nov
2014 2013 Initial
pence pence pence
General pool
Net asset value per General Ordinary Share 75.8 78.0 88.4
Net asset value per General 'A' Share 6.0 6.2 6.1
Cumulative dividends per General Ordinary Share 17.5 12.5 -
Total return per General Ordinary Share and 'A'
Share 99.3 96.7 94.5
Structured pool
Net asset value per Structured Ordinary Share 78.2 80.1 88.4
Net asset value per Structured 'A' Share 6.2 6.3 6.1
Cumulative dividends per Structured Ordinary Share 17.5 12.5 -
Total return per Structured Ordinary Share and 'A'
Share 101.8 98.9 94.5
Low Carbon pool (per GBP1 invested) *
Net asset value per 1.0695 Low Carbon Ordinary
Shares 88.9 89.7 94.5
Cumulative dividends per 1.0695 Low Carbon Ordinary
Shares 18.7 13.3 -
Total return per 1.0695 Low Carbon Ordinary Shares 107.6 103.0 94.5
* Low Carbon Ordinary Shares were originally issued at 93.5p per share.
The above figures have been expressed in terms of an original investment
of GBP1, which equates to a holding of 1.0695 shares.
CHAIRMAN'S STATEMENT
I am pleased to present a Shareholder update for the 12 month period
ended 30 November 2014.
The Company has moved its year end from 30 November to 31 May. In order
to keep shareholders up to date, this report has been prepared covering
the twelve month period ended 30 November 2014.
General Share pool
At 30 November 2014, the net asset value ("NAV") of a combined holding
of one General Ordinary Share and one General 'A' Share stood at 81.8p,
an increase of 2.6p or 3.1% after adjusting for the dividend paid in the
period. The Total Return (NAV plus dividends paid to date) now stands at
99.3p compared to the initial cost to subscribers in the share offer,
net of income tax relief, of 70.0p.
Since the period end the share pool has realised the non-qualifying
investment in Hoole Hall Hotel Limited at a sum equal to carrying value
A full review of the General Share pool is presented below.
Structured Share pool
At 30 November 2014, the NAV of a combined holding of one Structured
Ordinary Share and one Structured 'A' Share stood at 84.3p, an increase
of 2.9p or 3.3% after adjusting for the dividend paid during the period.
The Total Return (NAV plus dividends paid to date) now stands at 101.8p
compared to the initial cost to subscribers in the share offer, net of
income tax relief, of 70.0p.
A full review of the Structured Share pool is presented below.
Low Carbon Share pool
The Low Carbon Ordinary Share NAV at 30 November 2014 stood at 83.1p.
Shareholders will recall that Low Carbon Ordinary Shares were originally
issued at 93.5p per share. Rebasing for an original investment of GBP1,
Total Return (NAV plus dividends paid to date) now stands at 107.6p
compared to the initial cost, net of income tax relief, of 70.0p.
A full review of the Low Carbon Share pool is presented below.
VCT qualification levels
At 30 November 2014, the Company had 79.5% of its funds invested in VCT
qualifying investments, comfortably in excess of the minimum level of
70% required by the VCT regulations.
Dividends
In line with the historic financial calendar, the Company will pay
interim dividends of 2.5p per share for each of the General Ordinary
Shares, Structured Ordinary Shares and Low Carbon Ordinary Shares in
May.
Each of the dividends will be paid on 29 May 2015 to Shareholders on the
register at 1 May 2015.
Share buybacks
The Company operates a share buyback policy across all pools whereby,
subject to certain restrictions, it intends to buy in any of its own
shares that become available in the market for cancellation. In its
first five years, the Company has a policy of undertaking any buybacks
at a price equal to the latest published NAV i.e. at nil discount.
No shares were bought back in the period.
Developments
Although the Company is currently of a reasonable size for a VCT, the
Board is conscious that size will reduce as the Company starts to return
funds to investors, scheduled to start in 2016.
Future Developments (continued)
The Board is currently in discussions with other parties that may or may
not lead to a merger with one or more other VCTs. If a merger is to go
ahead, it will be achieved by means of a scheme (or schemes) or
arrangement under Section 110 of the Insolvency Act.
It is intended that any merger will not have any impact on the Company's
existing exit plans. The benefits are expected to be reduced running
costs and additional flexibility in unwinding the various share classes.
There may also be some other benefits that the Board is exploring. I
hope to be in a position to bring you further news in the near future.
Outlook
Progress has continued to be satisfactory over the 12 months to 30
November 2014 and has continued since that date. The Manager is now
starting to look ahead and beginning to do some early work on
formulating exit plans.
The Board believes that a merger with other VCTs may be able to deliver
some good benefits to Shareholders, even though the exits are planned to
commence in 2016. We are continuing to formulate a merger proposal which
I hope to be able to present to Shareholders shortly.
Sir Aubrey Brocklebank
Chairman
INVESTMENT MANAGER'S REPORT
GENERAL SHARE POOL
The General Share pool continued to make further VCT qualifying
investments during the 12 months ended 30 November 2014, partly funded
by realisations of non-qualifying investments.
Portfolio activity
At the period end, the pool held a portfolio of 16 VCT qualifying or
part qualifying investments and 9 non-qualifying investments. One new
qualifying investment was made at a cost of GBP400,000 into Oak Grove
Renewables Limited. One further investment was made in Vulcan Renewables
Limited at a cost of GBP44,000. GBP128,000 was received to pay down the
existing loan in Kidspace Adventures Limited, these proceeds were
reinvested into Kidspace Adventures Holdings Limited. Details are below:
Oak Grove Renewables Limited is developing a 2.0MW maize fed biogas
plant in Norfolk. Biogas is produced through an anaerobic digestion
process, which is then used to generate electricity. GBP400,000 was
invested in to the company during the period.
Vulcan Renewables Limited is developing a similar 2.0MW maize fed biogas
plant near Doncaster. At this plant, biogas is produced though an
anaerobic digestion process and then goes through additional processing
so that it can be injected in to the National Gas Grid. Some of the gas
is also used to produce electricity. A further GBP44,000 was invested in
to this company in the period.
Additionally a small further investment of GBP50,000 was made in to
London City Shopping.
During the period, several non-qualifying loan stock investments were
realised at par: GBP350,000 from Future Biogas (SF) Limited, GBP150,000
from Antelope Pub Limited and GBP55,000 from South-Western Farms Solar
Limited.
A loan in Dominions House Limited was refinanced in the period which
returned GBP80,000 to the pool.
Proceeds of GBP2,000 were received in respect of Helcim Limited, an
investment which was realised in a previous period. The proceeds were in
excess of the amount previously accrued.
Portfolio performance
The pool is generally performing satisfactorily and, in time, we expect
to see these investments deliver growth, in particular, the various
renewable energy investments in the portfolio. There were several
valuation movements in the period with a total value decrease of
GBP92,000.
Kidspace Adventures Holdings Limited is the holding company of Kidspace
Adventures Limited, which owns three children's play centres. Continued
good performance at all three sites has resulted in an increase in value
of GBP129,000.
Wickham Solar Limited owns a ground mounted solar farm in Lincolnshire.
The company is expected to perform to plan and a small uplift of
GBP28,000 has been recognised in the period.
Residential PV Trading Limited owns solar panels on the rooftops of over
260 domestic properties in the south of the UK. Performance continues to
be good and an increase in value of GBP18,000 has been recognised in the
period.
Mosaic Spa and Health Clubs Limited owns and manages two health clubs:
The Shrewsbury Club, in Shrewsbury; and Holmer Park in Hereford. It also
provides gym and spa management services to hotels, universities and
corporate clients. Both Holmer Park and the Shrewsbury club have
underperformed against expectations throughout the period and the value
has been reduced by GBP111,000.
Performance at the nightclub owned by City Falkirk Limited continues to
be significantly below expectations and a reduction in value of
GBP61,000 has been made.
A reduction of GBP50,000 has been made to Cheers Dumbarton Limited
following a period of below budget trading at the Cheers nightclub in
Dumbarton, Scotland.
South-Western Farms Solar Limited owns a portfolio of ground mounted
solar panels in the southwest of the UK. Significant remedial costs have
been incurred in order to get all sites generating electricity and,
consequently, a valuation reduction of GBP45,000 has been made.
Snow Hill Developments LLP developed the Holiday Inn Express Hotel in
Snow Hill, Birmingham. The hotel has been partly funded by The
Co-operative Bank and, due to a later opening than planned, the company
may now breach banking covenants. The business is trading satisfactorily
and the Board believes it remains appropriate to continue to hold the
investment at cost, however the investment is not without risk while
arrangements with the bank are addressed
Details of the General Share pool portfolio and investment activity
during the period is shown below.
Net asset value
At 30 November 2014, NAV per General Ordinary Share stood at 75.8p and
the NAV per General 'A' Share stood at 6.0p, producing a combined total
of 81.8p. This is an increase of 2.6p per share (3.1%) since 30 November
2013 (after taking into account the 5.0p dividend paid during the year).
The NAV plus cumulative dividends paid to date for one General Ordinary
Share and one General 'A' Share amounts to 99.3p, compared to the
initial cost to investors net of income tax relief of 70.0p.
Results and dividends
The portfolio delivered investment income of GBP1.1 million during the
year. The profit on ordinary activities after taxation for the period
was GBP403,000 (2013: GBP393,000), comprising a revenue profit of
GBP550,000 (2013: GBP515,000) and a capital loss of GBP147,000 (2013:
GBP122,000).
The General Share pool will pay an interim dividend of 2.5p per General
Ordinary Share on 29 May 2015 to Shareholders on the register at 1 May
2015.
Outlook
The task of building the General Share portfolio is now complete and has
resulted in a reasonably well-diversified portfolio which produces a
steady ongoing yield and has growth potential.
Our focus will shift towards close monitoring of all portfolio companies
so that we are well positioned to provide support if needed as the
businesses develop and we work towards the planned exit, which is due to
commence in 2016.
Downing LLP
SUMMARY OF INVESTMENT PORTFOLIO
GENERAL SHARE POOL
as at 30 November 2014
Unrealised % of
gain/(loss) portfolio
Cost Valuation in period by value
GBP'000 GBP'000 GBP'000
VCT qualifying investments
Vulcan Renewables Limited 1,664 1,664 - 12.7%
Kidspace Adventures Holdings
Limited 1,116 1,334 129 10.2%
Tooting Tram and Social
Limited* 1,067 1,187 - 9.1%
Mosaic Spa and Health Clubs
Limited* 1,500 1,147 (111) 8.8%
Residential PV Trading Limited 600 762 18 5.8%
Westcountry Solar Solutions
Limited 600 600 - 4.6%
South-Western Farms Solar
Limited 600 555 (45) 4.2%
Odysian (Holdings) Limited 527 543 - 4.1%
Avon Solar Energy Limited 505 505 - 3.8%
Wickham Solar Limited 472 500 28 3.8%
Fubar Stirling Limited 429 429 - 3.3%
Oak Grove Renewables Limited 400 400 - 3.1%
City Falkirk Limited 674 330 (61) 2.5%
Angel Solar Limited 300 300 - 2.3%
Cheers Dumbarton Limited 76 26 (50) 0.2%
Lochrise Limited 20 - - 0.0%
10,550 10,282 (92) 78.5%
Non-qualifying investments
Hoole Hall Hotel Limited 1,200 1,200 - 9.2%
Snow Hill Developments LLP 750 750 - 5.7%
Kidspace Adventures Limited 324 324 - 2.5%
Antelope Pub Limited 150 150 - 1.1%
Dominions House Limited 98 98 - 0.7%
Clean Electricity Limited 70 70 - 0.5%
UK Renewable Power Limited 55 55 - 0.4%
London City Shopping Centre
Limited 50 50 - 0.4%
21(st) Century Energy Limited 22 22 - 0.2%
2,719 2,719 - 20.7%
Total 13,269 13,001 (92) 99.2%
Cash at bank and in hand 104 0.8%
Total investments 13,105 100.0%
* Part-qualifying investment
SUMMARY OF INVESTMENT MOVEMENTS
GENERAL SHARE POOL
for the six months ended 30 November 2014
Additions
GBP'000
VCT qualifying investments
Oak Grove Renewables Limited 400
Kidspace Adventures Holdings Limited 128
Vulcan Renewables Limited 44
572
Non-qualifying investments
London City Shopping Centre Limited 50
50
622
Disposals
Market
value at Total
1 Dec Gain vs. realised
Cost 2013 Proceeds cost gain
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Non-qualifying
investments
Future Biogas (SF)
Limited 350 350 350 - -
Kidspace Adventures
Limited 189 189 189 - -
Antelope Pub Limited 150 150 150 - -
Dominions House
Limited 80 80 80 - -
South-Western Farms
Solar Limited 55 55 55 - -
Helcim Limited - - 2 2 2
824 824 826 2 2
Of the investments above, Helcim Limited was realised in a prior period
but received proceeds in the current period in excess of the amount
previously accrued.
INVESTMENT MANAGER'S REPORT
STRUCTURED SHARE POOL
The Structured Share pool continued to make further VCT qualifying
investments during the year ended 30 November 2014. Funds for the new
investments were provided by redemptions from the Structured Product
portfolio which produced another solid performance.
VCT qualifying investment activity
At the period end, the pool held a portfolio of 16 VCT qualifying or
part qualifying investments and 7 non-qualifying investments. One new
qualifying investment was made at a cost of GBP545,000 into Oak Grove
Renewables Limited. One further investment was made into Vulcan
Renewables Limited for a cost of GBP82,000. One non-qualifying
investment was transferred in from the General Share pool at a cost of
GBP150,000, the Antelope Pub Limited. GBP85,000 was received to pay down
the existing loan in Kidspace Adventures Limited, these proceeds were
reinvested into Kidspace Adventures Holdings Limited. Details are
below:
Vulcan Renewables Limited is developing a 2.0MW maize fed biogas plant
near Doncaster. Biogas is produced though an anaerobic digestion process
and then goes through additional processing so that it can be injected
in to the National Gas Grid. Some of the gas is also used to produce
electricity. A further GBP82,000 was invested in to this company in the
period.
Antelope Pub Limited is a freehold pub in Tooting, South London. The
pool invested GBP150,000 of non-qualifying loans into the company.
VCT qualifying investment performance
The pool is generally performing satisfactorily and, in time, we expect
to see these investments deliver growth, in particular, the various
renewable energy investments in the portfolio. There were few valuation
movements in the period with a total value decrease of GBP52,000.
Kidspace Adventures Holdings Limited is the holding company of Kidspace
Adventures Limited which owns three children's play centres. Continued
good performance at all three sites has resulted in an increase in value
of GBP86,000.
Wickham Solar Limited owns a ground mounted solar farm in Lincolnshire.
The company is expected to perform to plan and a small uplift of
GBP28,000 has been recognised in the period.
Residential PV Trading Limited owns solar panels on the rooftops of over
260 domestic properties in the south of the UK. Performance continues to
be good and an increase in value of GBP12,000 has been recognised in the
period.
Mosaic Spa and Health Clubs Limited owns and manages two health clubs:
The Shrewsbury Club, in Shrewsbury; and Holmer Park in Hereford. It also
provides gym and spa management services to hotels, universities and
corporate clients. Both Holmer Park and the Shrewsbury club have
underperformed against expectations throughout the period and the value
has been reduced by GBP74,000.
Performance at the nightclub owned by City Falkirk Limited continues to
be significantly below expectations and a reduction in value of
GBP40,000 has been made.
A reduction of GBP33,000 has also been made to Cheers Dumbarton Limited
following a period of below budget trading at the Cheers nightclub in
Dumbarton, Scotland.
South-Western Farms Solar Limited owns a portfolio of ground mounted
solar panels in the South West of the UK. Significant remedial costs
have been incurred in order to get all sites generating electricity and,
consequently, a valuation reduction of GBP30,000 has been made.
All other investments are performing satisfactorily and, in time, we
expect to see these investments deliver growth, in particular, the
various renewable energy investments in the portfolio.
Structured Product portfolio
Shareholders will recall that the strategy of the Structured Share pool
has been to invest funds not utilised for VCT qualifying investments in
a portfolio of defensive Structured Products.
The portfolio has performed in line with expectations over the period,
producing unrealised gains of GBP96,000 and three redemption generating
realised gains of GBP31,000.
Further Structured Products are likely to mature this year and next
year. The intention is to reinvest the proceeds into shorter-dated
Structured Products or alternative investments, depending on the
opportunities available at the time.
Net asset value
The NAV per Structured Ordinary Share stood at 78.2p and per Structured
'A' Share stood at 6.2p at the period end, producing a combined total of
84.3p. This is an increase of 2.9p per share (3.3%) since 30 November
2013 (after taking into account the 5.0p dividend paid during the
period). The NAV plus cumulative dividends paid to date for one
Structured Ordinary Share and one Structured 'A' Share amounts to 101.8p,
compared to the initial cost to investors net of income tax relief of
70.0p.
Results and dividend
The pool's profit on ordinary activities after taxation for the period
was GBP307,000 (2013: GBP326,000), comprising a revenue profit of
GBP271,000 (2013: GBP171,000) and a capital profit of GBP36,000 (2013:
GBP155,000).
The pool will pay an interim dividend of 2.5p per Structured Ordinary
Share on 29 May 2015 to Shareholders on the register at 1 May 2015.
Outlook
The task of building the pool's VCT qualifying portfolio is now complete
and has resulted in a reasonably well diversified portfolio which
produces a steady ongoing yield and has growth potential.
Our focus will shift towards close monitoring of all portfolio companies
so that we are well positioned to provide support if needed as the
businesses develop and we work towards the planned exit, which is due to
commence in 2016.
Downing LLP
SUMMARY OF INVESTMENT PORTFOLIO
STRUCTURED SHARE POOL
as at 30 November 2014
Unrealised % of
gain/(loss) portfolio
Cost Valuation in period by value
GBP'000 GBP'000 GBP'000
VCT qualifying investments
Vulcan Renewables Limited 982 982 - 11.0%
Kidspace Adventures Holdings
Limited 744 889 86 10.0%
Oak Grove Renewables Limited 545 545 - 7.2%
Tooting Tram and Social
Limited 533 613 - 6.9%
Mosaic Spa and Health Clubs
Limited* 920 685 (74) 6.6%
Residential PV Trading Limited 400 508 12 5.7%
Wickham Solar Limited 472 500 28 5.6%
Westcountry Solar Solutions
Limited 400 400 - 4.5%
South-Western Farms Solar
Limited 400 370 (30) 4.2%
Odysian (Holdings) Limited 351 362 - 4.1%
Avon Solar Energy Limited 336 336 - 3.8%
Fubar Stirling Limited 286 286 - 3.2%
City Falkirk Limited 450 220 (40) 2.5%
Angel Solar Limited 200 200 - 2.2%
Cheers Dumbarton Limited 51 18 (33) 0.2%
Lochrise Limited 13 - - 0.0%
7,083 6,914 (51) 77.7%
Non-qualifying investments
Kidspace Adventures Limited 216 216 - 2.4%
Antelope Pub Limited 150 150 - 1.7%
366 366 - 4.1%
Structured Product investments
HSBC 7.1% Defensive
Worst-Of-AC 401 426 13 4.8%
RBS 6 Yr Dul Index Synthetic
Zero 10.16% 251 372 26 4.2%
Credit Suisse 10% Defensive
Worst-Of-AC 267 281 13 3.2%
Goldman Sachs 8.5% Defensive
Worst-Of-AC 251 279 22 3.1%
Credit Suisse 7% Defensive
Worst-Of-AC 251 272 21 3.1%
1,421 1,630 95 18.4%
Total 8,870 8,910 44 100.2%
Cash at bank and in hand (16) (0.2%)
Total investments 8,894 100.0%
* Part-qualifying investment
SUMMARY OF INVESTMENT MOVEMENTS
STRUCTURED SHARE POOL
for the six months ended 30 November 2014
Additions
GBP'000
VCT qualifying investments
Oak Grove Renewables Limited 545
Kidspace Adventures Holdings Limited 85
Vulcan Renewables Limited 82
712
VCT non-qualifying investments
Antelope Pub Limited 150
150
Structured product investments
Credit Suisse 10% Defensive Worst Of Auto Call 267
267
1,129
Disposals
Market
value at Total
1 Dec Gain vs. realised
Cost 2013 Proceeds cost gain
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Non-qualifying
investments
Kidspace Adventures
Limited 125 125 125 - -
Helcim Limited - - 1 1 1
125 125 126 1 1
Structured Product
investments
Barclays 7.75%
Defensive
Worst-Of-AC 351 360 374 23 14
BNP Paribas Harewood
Abs Progression 2 253 262 270 17 8
UBS 7.3% Defensive
Worst Of AC 251 261 269 18 8
855 883 913 58 30
980 1,008 1,039 59 31
Of the investments above, Helcim Limited was realised in a prior period
but received proceeds in the current period in excess of the amount
previously accrued.
INVESTMENT MANAGER'S REPORT
LOW CARBON SHARE POOL
The task of building the Low Carbon investment portfolio was completed
at an early stage, ahead of deadlines for changes in the Feed-in Tariffs
("FiTs") and other regulations. As a result, there has been no
investment activity in the period. Some of the investee companies have
now started to establish steady track records and have justified some
initial uplifts in value.
Investment activity
At 30 November 2014, the share pool had a portfolio of seven investments
with a total cost of GBP6.4 million. All of the investments in which the
pool has invested own solar PV panels sited on a mix of commercial and
residential rooftops, all of which receive FiTs.
There were no new or further investments in the period nor any
realisations.
The majority of the investments are now valued above cost and are
consistently generating electricity at the planned levels. Those where
the track record is not yet sufficiently established have been held at
original cost and one investment, Clean Electricity Limited, has been
written down by GBP70,000 following issues with a number of cracked PV
panels. The cause of this issue is being investigated and is expected to
be resolved in the near future.
In the case of two investments: Progressive Energies Limited; and PV
Generation Limited, yield has been sufficiently proven to justify
increasing the carrying values by GBP120,000 and GBP60,000 respectively.
Net asset value
At 30 November 2014, the NAV per Low Carbon Ordinary Share stood at
83.1p. This is an increase of 4.3p per share (5.1%) since 30 November
2013 (after taking into account the 5.0p dividend paid during the year).
Low Carbon Ordinary Shares were originally issued at a price of 93.5p
each. The equivalent Total Return (NAV plus dividend paid to date) for
an original investment of GBP1 now stands at 107.6p.
Results and dividend
The share pool's profit on ordinary activities after taxation for the
period was GBP347,000 (2013: GBP687,000), comprising a revenue profit of
GBP268,000 (2013: GBP308,000) and a capital profit of GBP79,000 (2013:
GBP379,000).
The Company will pay an interim dividend of 2.5p per Low Carbon Ordinary
Share on 29 May 2015 to Shareholders on the register at 1 May 2015.
Outlook
The share pool remains fully invested in a portfolio of investments
which have index-linked returns and significantly higher yields than
potential alternative investments. We are satisfied with the progress
made by the portfolio companies to date.
Downing LLP
SUMMARY OF INVESTMENT PORTFOLIO
LOW CARBON SHARE POOL
as at 30 November 2014
Unrealised % of
gain portfolio
Cost Valuation in period by value
GBP'000 GBP'000 GBP'000
VCT qualifying investments
Progressive Energies Limited * 1,400 1,520 120 22.0%
Green Electricity Generation
Limited 1,000 1,210 - 17.5%
PV Generation Limited 1,000 1,150 60 16.6%
Progressive Power Generation
Limited 800 800 - 11.6%
UK Renewable Power Limited 780 780 - 11.3%
Clean Electricity Limited 780 710 (70) 10.3%
21(st) Century Energy Limited 600 708 - 10.2%
Total 6,360 6,878 110 99.5%
Cash at bank and in hand 35 0.5%
Total investments 6,913 100.0%
* Part qualifying investment
There were no additions or disposals in the period.
UNAUDITED SUMMARISED BALANCE SHEET
as at 30 November 2014
30 Nov
30 November 2014 2013
General Structured Low Carbon
Share pool Share pool Share pool Total Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Fixed assets
Investments 13,001 8,910 6,878 28,789 28,806
Current assets
Debtors 337 409 75 821 292
Cash at bank and in
hand 104 (16) 35 123 1,351
441 393 110 944 1,643
Creditors: amounts
falling due within
one year (459) (180) (254) (893) (920)
Net current assets/
(liabilities) (18) 213 (144) 51 723
Net assets 12,983 9,123 6,734 28,840 29,529
Capital and
reserves
Called up Ordinary
Share capital 16 11 8 35 35
Called up 'A' Share
capital 18 13 - 31 31
Revaluation reserve (268) 66 518 316 254
Capital reserve -
realised - 365 - 365 365
Special reserve 12,863 8,648 5,821 27,332 28,613
Revenue reserve 354 20 387 761 231
Equity
shareholders'
funds 12,983 9,123 6,734 28,840 29,529
Net asset value
per:
General Ordinary 75.8p 78.0p
Share
General 'A' Share 6.0p 6.2p
Structured Ordinary 78.2p 80.1p
Share
Structured 'A' 6.2p 6.3p
Share
Low Carbon Ordinary 83.1p 83.8p
Share
UNAUDITED INCOME STATEMENT
for the six months ended 30 November 2014
Year ended Year ended
30 November 2014 30 November 2013
Company Total Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 2,132 - 2,132 2,027 - 2,027
Gain on investments
- realised - 39 39 - 168 168
- unrealised - 62 62 - 429 429
2,132 101 2,233 2,027 597 2,624
Investment management
fees (398) (133) (531) (401) (133) (534)
Other expenses (342) - (342) (343) (52) (395)
Return on ordinary
activities before
taxation 1,392 (32) 1,360 1,283 412 1,695
Taxation (304) - (304) (289) - (289)
Return attributable to
equity shareholders 1,088 (32) 1,056 994 412 1,406
Return per:
General Ordinary Share 3.5p (0.9p) 2.6p 3.3p (0.8)p 2.5p
General 'A' Share - - - - - -
Structured Ordinary 2.5p 0.3p 2.9p 1.6p 1.5p 3.1p
Share
Structured 'A' Share - - - - - -
Low Carbon Ordinary 3.3p 1.0p 4.3p 3.8p 4.7p 8.5p
Share
A Statement of Total Recognised Gains and Losses has not been prepared
as all gains and losses are recognised in the Income Statement as noted
above.
UNAUDITED INCOME STATEMENT (continued)
for the six months ended 30 November 2014
Year ended Year ended
30 November 2014 30 November 2013
General Share pool Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 1,038 - 1,038 1,003 - 1,003
Gain/(loss) on
investments
- realised - 5 5 - 16 16
- unrealised - (92) (92) - (45) (45)
1,038 (87) 951 1,003 (29) 974
Investment management
fees (180) (60) (240) (184) (61) (245)
Other expenses (155) - (155) (158) (32) (190)
Return on ordinary
activities before
taxation 703 (147) 556 661 (122) 539
Taxation (153) - (153) (146) - (146)
Return attributable to
equity shareholders 550 (147) 403 515 (122) 393
Structured Share pool Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 581 - 581 463 - 463
Gain on investments
- realised - 34 34 - 152 152
- unrealised - 44 44 - 66 66
581 78 659 463 681
Investment management
fees (126) (42) (168) (129) (43) (172)
Other expenses (108) - (108) (110) (20) (130)
Return on ordinary
activities before
taxation 347 36 383 224 155 379
Taxation (76) - (76) (53) - (53)
Return attributable to
equity shareholders 271 36 307 171 155 326
UNAUDITED INCOME STATEMENT (continued)
for the six months ended 30 November 2014
Six months ended Year ended
30 November 2014 30 November 2013
Low Carbon Share pool Revenue Capital Total Revenue Capital Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Income 513 - 513 561 - 561
Gain on investments
- unrealised - 110 110 - 408 408
513 110 623 561 408 969
Investment management
fees (92) (31) (123) (88) (29) (117)
Other expenses (79) - (79) (75) - (75)
Return on ordinary
activities before
taxation 342 79 421 398 379 777
Taxation (75) - (75) (90) - (90)
Return attributable to
equity shareholders 267 79 346 308 379 687
RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' FUNDS
for the six months ended 30 November 2014
30 November 2014 31 Nov 2013
General Structured Low Carbon
Share pool Share pool Share pool Total Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Opening
Shareholders'
funds 13,365 9,372 6,792 29,529 29,865
Dividends (785) (535) (404) (1,724) (1,725)
Shares bought
back - (21) - (21) (17)
Total
recognised
gain for the
period 403 307 346 1,056 1,406
Closing
Shareholders'
funds 12,983 9,123 6,734 28,840 29,529
UNAUDITED CASH FLOW STATEMENT
for the six months ended 30 November 2014
30 Nov
30 November 2014 2013
General Structured Low Carbon
Share pool Share pool Share pool Total Total
Note GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Cash inflow/(outflow) from operating activities
and returns on investments 1 507 (150) 344 701 1,377
Taxation
Corporation tax paid (155) (53) (93) (301) (81)
Capital expenditure
Purchase of investments (622) (1,129) - (1,751) (7,332)
Sale of investments 827 1,041 - 1,868 6,241
Net cash inflow/(outflow) from
capital expenditure 205 (88) - (117) (1,091)
Equity dividends paid (785) (535) (404) (1,724) (1,725)
Net cash outflow before
financing (228) (826) (153) (1,207) (1,520)
Financing
Purchase of own shares - (21) - (21) (17)
Net cash outflow from financing - (21) - (21) (17)
Decrease in cash 2 (228) (847) (153) (1,228) (1,537)
Notes to the cash flow statement:
1 Cash inflow/(outflow) from operating activities
and returns on investments
Return on ordinary activities
before taxation 556 383 421 1,360 1,695
Loss/(gain) on investments 87 (78) (110) (101) (597)
Increase in other debtors (121) (334) (72) (527) (3)
(Decrease)/increase in other
creditors (15) (121) 105 (31) 281
Net cash inflow/(outflow) from
operating activities 507 (150) 344 701 1,376
2 Analysis of net funds
Beginning of period 332 831 188 1,351 2,888
Net cash outflow (228) (847) (153) (1,228) (1,537)
End of period 104 (16) 35 123 1,351
NOTES TO THE UNAUDITED FINANCIAL STATEMENTS
1. The unaudited half yearly financial results cover the year 30
November 2014 and have been prepared in accordance with the accounting
policies set out in the statutory accounts for the year ended 30
November 2013, which were prepared under UK Generally Accepted
Accounting Practice ("UK GAAP") and in accordance with the Statement of
Recommended Practice "Financial Statements of Investment Trust
Companies" revised January 2009 ("SORP").
2. All revenue and capital items in the Income Statement derive from
continuing operations.
3. The Company has only one class of business and derives its income
from investments made in shares, securities and bank deposits.
4. The comparative figures are in respect of the year ended 30 November
2013.
5. Dividends
30 November 2014
Revenue Capital Total
GBP'000 GBP'000 GBP'000
General Ordinary Shares
Paid
2013 Final 196 196 392
2014 Interim - 393 393
196 589 785
Structured Ordinary Shares
Paid
2013 Final 162 106 268
2014 Interim - 267 267
162 373 535
Low Carbon Ordinary Shares
Paid
2013 Final 202 - 202
2014 Interim - 202 202
202 202 404
6. Reserves
Capital
Special reserve Revaluation Revenue
reserve - realised reserve reserve
GBP'000 GBP'000 GBP'000 GBP'000
At 1 December 2013 28,613 365 254 231
Share buyback (21) - - -
Expenses capitalised - (134) - -
Gains on investments - 39 62 -
Transfer between reserves (1,260) 1,260 - -
Retained net revenue for the
period - - - 1,089
Dividends paid - (1,165) - (559)
At 30 November 2014 27,332 365 316 761
The Special reserve, Capital reserve - realised and Revenue reserve are
all distributable reserves. Revaluation reserve includes losses of
GBP1,423,000 which are included in the calculation of distributable
reserves. Total distributable reserves are GBP27,036,000.
7. Net asset value per share has been calculated on 15,679,241 General
Ordinary Shares, 18,453,789 General 'A' Shares; 10,678,725 Structured
Ordinary Shares, 12,572,817 Structured 'A' Shares; and 8,102,222 Low
Carbon Ordinary Shares, being the shares in issue at the period end.
8. Return per share for the period has been calculated on 15,679,241
General Ordinary Shares, 18,453,789 General 'A' Shares; 10,702,424
Structured Ordinary Shares, 12,591,892 Structured 'A' Shares; and
8,102,222 Low Carbon Ordinary Shares, being the weighted average number
of shares in issue during the period.
9. The unaudited financial statements set out herein do not constitute
statutory accounts within the meaning of Section 434 of the Companies
Act 2006 and have not been delivered to the Registrar of Companies. The
figures for the year ended 30 November 2013 have been extracted from the
financial statements for that year, which have been delivered to the
Registrar of Companies; the Auditor's Report on those financial
statements was unqualified.
10. Risk and uncertainties
Under the Disclosure and Transparency Directive, the Board is required
in the Company's half year results to report on principal risks and
uncertainties facing the Company over the remainder of the financial
year.
The Board has concluded that the key risks facing the Company over the
remainder of the financial period are as follows:
(i) investment risk associated with investing in small and immature
businesses;
(ii) market risk in respect of the various assets held by the investee
companies; and
(iii) failure to maintain approval as a VCT.
In order to make VCT qualifying investments, the Company has to invest
in small businesses which are often immature. The Manager follows a
rigorous process in vetting and careful structuring of new investments
and, after an investment is made, close monitoring of the business. The
Manager also seeks to diversify the portfolio to some extent by holding
investments which operate in various sectors. The Board is satisfied
with this approach.
The Company's compliance with the VCT regulations is continually
monitored by the Manager, who reports regularly to the Board on the
current position. The Company also retains PricewaterhouseCoopers to
provide regular reviews and advice in this area. The Board considers
that this approach reduces the risk of a breach of the VCT regulations
to a minimal level.
11. Going concern
The Directors have reviewed the Company's financial resources at the
period end and conclude that the Company is well placed to manage its
business risks.
The Board confirms that it is satisfied that the Company has adequate
resources to continue in business for the foreseeable future. For this
reason, the Board believes that the Company continues to be a going
concern and that it is appropriate to apply the going concern basis in
preparing the financial statements.
12. The Directors confirm that, to the best of their knowledge, the half
yearly financial statements have been prepared in accordance with the
"Statement: Half Yearly Financial Reports" issued by the UK Accounting
Standards Board and the half yearly financial report 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.
13. Copies of the unaudited half yearly financial report will be sent to
Shareholders shortly. Further copies can be obtained from the Company's
Registered Office and will be available for download from
www.downing.co.uk.
This announcement is distributed by NASDAQ OMX Corporate Solutions on
behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely
responsible for the content, accuracy and originality of the information
contained therein.
Source: Downing Planned Exit VCT 2011 plc via Globenewswire
HUG#1907089
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