Final Results and NAV Update

Seneca Growth Capital VCT PLC
·87-min read

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED. ON PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.

23 February 2021

Seneca Growth Capital VCT plc

Annual Report and Financial Statements
for the year ended 31 December 2020
NAV Update
and
Notice of Annual General Meeting

The Directors are pleased to announce the audited results of the Company for the year ended 31 December 2020. A copy of the Annual Report and Financial Statements will be made available to shareholders shortly, and extracts are now set out below.

The Company’s AGM will be a closed meeting as a result of the Covid-19 (“C-19”) pandemic and will be held at 14:00 on Monday, 29 March 2021 at 9 The Parks, Haydock, WA12 0JQ. A copy of the Notice of AGM and Annual Report and Accounts will be available on the Company’s website: www.senecavct.co.uk

Financial Headlines

Ordinary Shares

95.5p

Ordinary share NAV plus cumulative dividends paid at 31 December 2020 (“Total Return”)

30.2p

Ordinary share NAV at 31 December 2020

13.0p

Interim capital dividends paid per Ordinary share during year

B Shares

£2.4m

Amount raised during the year from the issue of B shares

£1.36m

Amount invested during the year into six new investee companies by B share pool

97.8p

B share NAV plus cumulative dividends paid at 31 December 2020 (“Total Return”)

91.8p

B share NAV at 31 December 2020

3.0p

Interim dividends paid per B share during year

Financial Summary­­­

Year to
31 December 2020
Ordinary share pool

Year to

31 December 2020

B share
pool

Year to
31 December 2019
Ordinary share pool

Year to
31 December 2019
B share
pool

Net assets (£’000s)

2,453

8,317

2,463

5,921

Return on ordinary activities after tax (£’000s)

1,045

252

(547)

(168)

Earnings per share (p)

12.8

3.5

(6.7)

(3.2)

Net asset value per share (p)

30.2

91.8

30.4

93.1

Dividends paid since inception (p)

65.25

6.00

52.25

3.0

Total return (NAV plus cumulative dividends paid) (p)

95.45

97.8

82.65

96.1

Financial Calendar

The Company’s financial calendar is as follows:

29 March 2021 Annual General Meeting (“AGM”) will be a closed meeting as a result of the Covid-19 (“C-19”) pandemic and will be held at 14:00 at 9 The Parks, Haydock, WA12 0JQ

July 2021 Half-yearly results to 30 June 2021 published

February 2022 Annual results for the year to 31 December 2021 announced and Annual Report and Financial Statements published

For further information, please contact:

John Hustler, Seneca Growth Capital VCT Plc at john.hustler@btconnect.com

Richard Manley, Seneca Growth Capital VCT Plc at Richard.Manley@senecapartners.co.uk

Please note: page references and defined terms included in the extracts below refer to the page numbers and definitions in the Annual Report and Financial Statements.

Chairman’s Statement

I am pleased to present the 2020 Annual Report on behalf of the Board to shareholders.

Overview

As shareholders will recall, Seneca have assumed the investment and accounting responsibilities of the Company with effect from August 2018, following which £8.7 million has been raised for the B share pool to 31 December 2020. Since this represents the active investment portfolio, I am reporting on the B share portfolio first and then will give the results of the legacy Ordinary share portfolio.

I am pleased to say that, despite the unprecedented circumstances which we are all facing due to the C-19 global pandemic, I am able to report that both the B share and Ordinary share investment portfolios have stood up well to the challenges that they have faced. The Total Return (NAV per share plus cumulative dividends per share) for each share class increased during the year with the B share increasing by 1.8% to 97.8p and the Ordinary share increasing by 15.5% to 95.5p.

I am also pleased to be able to report that Seneca continued the development of the B share pool during the year both in terms of fundraising and investment activity. In October 2020, the Company launched its third offer for B shares and allotted an additional £1.5 million of shares in December 2020 taking to £8.7 million the total raised by the B share pool from launch in May 2018 to 31 December 2020. I would like to welcome all new shareholders and thank both existing and new shareholders for their support. The share offer will remain open until 28 May 2021 unless it reaches the target of £10 million with an over-allotment facility of £10 million before then.

The Company made six new B share pool investments in the year in addition to achieving one full exit and one partial exit and as a result the Company’s B share pool closed the year with ten investments, an increase of five on the prior year.

There were two full, and one partial disposal from the Ordinary share pool. The Ordinary share pool now has just seven investments remaining with AIM quoted Scancell Holdings Plc (“Scancell”) (which encouragingly secured £48 million of new investment in the year) accounting for 66% of the Ordinary share pool’s NAV at the year end. Recent press coverage regarding Scancell’s involvement in a potential C-19 vaccine has led to a significant rise in its share price, which stood at 24.5p at 19 February 2021 compared to our year end value of 13.5p. Further details and an updated unaudited NAV per Ordinary share and B share are included below.

With 54% of the B share pool’s NAV as at 31 December 2020 represented by cash and more than 20% of the Ordinary share pool’s NAV, the Company has ended the year well placed to face the challenges and opportunities presented by the ongoing C-19 pandemic and to deliver on the key objectives of continuing to build an attractive portfolio of growth capital investments in the Company’s B share pool whilst also continuing to realise investments in the Ordinary share pool when the opportunity arises.

I have set out below the progress made by each of the Company’s share classes during the year.

B Share Pool

B Shares - Results

The key items to impact the NAV of the B share pool during the year were as follows:

  • Two dividends paid during the year totalling 3.0p per B share.

  • The full realisation of one B share pool AIM quoted investment generating a 2.1x return.

  • The partial exit of one B share pool AIM quoted investment generating a 1.6x return.

  • An increase in the valuation of two of the B share pool’s remaining three AIM quoted holdings.

  • A reduction in fair value of one of the B share pool’s seven unquoted company investments as a result of the impact of C-19.

  • The Company’s running costs.


The net result of the above was an overall increase in the Total Return per B share to 97.8p as at 31 December 2020 (2019: 96.1p), consisting of a modest reduction in the NAV per B share to 91.8p as at 31 December 2020 (2019: 93.1p), a positive capital return of 5.7p per B share (2019: negative 0.7p) and a negative revenue return of 2.2p per B share (2019: negative 2.5p).

Whilst the negative revenue return of 2.2p per B share is principally a result of the impact of the Company’s running costs on the B share pool, shareholders will recall that the Company’s running expenses are capped at 3% of the B share NAV until July 2021 (thereafter the total running costs will continue to be capped at 3% with general expenses being allocated to the Ordinary share pool and the B share pool pro-rata to their respective NAVs). As a result, Seneca reduced their annual management fee for 2020 from £127k to £41k to ensure the Company’s annual running expenses stayed within this 3% limit.

The positive capital return of 5.7p per B share noted above was principally due to increases in the share prices of the B share pool’s AIM quoted investments during the year and some harvesting of profit via partial sales of these AIM quoted investments offset by a reduction in the carrying value of one of the B share pool’s unquoted company investments. Full details are disclosed in the Investment Manager’s Report on pages 14 to 27.

B Shares - Investment Portfolio Review

As at 31 December 2020, the B share portfolio comprised ten companies, three of which are quoted on AIM, at a total net investment cost of £3,794k. As at 31 December 2020 this portfolio was valued at £3,982k.

In January 2021, the Company sold 1,750,000 shares in SkinBioTherapeutics Plc (“SkinBio”) which represented 37% of the original holding of 4,677,107 shares, reducing the remaining holding to 2,752,107 shares. These were sold at a net average price of 35.5p per share providing a return in the region of 2.2x on original cost.

B Shares – Update and Outlook

Taking into account further proceeds realised since 31 December 2020 as detailed above and in note 17 on page 97 and an overall increase in AIM quoted investment bid prices, the Company is pleased to announce an updated unaudited NAV per B share of 99.4p per B share at 19 February 2021, an increase of 7.6p per B share from the audited NAV of 91.8p per B share as at 31 December 2020 and an overall increase in the Total Return per B share to 105.4p as at 19 February 2021.

Shareholders will be pleased to know the Board declared an interim B share dividend of 1.5p per B share on 18 February 2021 to be paid on 14 May 2021 to shareholders on the B share register on 30 April 2021, with an ex-dividend date of 29 April 2021.

Seneca continue to work closely with the investee companies in the B share portfolio with the aim of ensuring that the potential impact of C-19 is mitigated and that each investee company has sufficient funds to support their working capital requirements until normal trading and economic conditions return. Seneca remain confident that the portfolio retains its potential to provide attractive returns for B shareholders over the medium term.

The Board is pleased with the progress that Seneca have made since their appointment as Investment Manager in 2018, in terms of funds raised, new investments made and relationships with brokers offering new quoted securities and now, exits achieved.

Seneca expect to increase the funds raised under the current B share Offer and add new growth capital investments to the B share portfolio during the course of 2021 from, inter alia, the investments they currently have in the later stages of due diligence.

Ordinary Share Pool

Ordinary Shares - Results

Whilst the NAV per Ordinary share decreased by 0.2p from 30.4p to 30.2p during the year, this was after the payment of dividends per Ordinary share totalling 13.0p. A better understanding of the underlying performance of the Company’s Ordinary share portfolio during the year is therefore provided by considering the NAV movement per Ordinary share during the year before dividends which shows an increase of some 12.8p (a 42% increase compared to 31 December 2019).

This increase was principally driven by the increase in value of the Ordinary share portfolio’s two AIM quoted investments during the year. The quoted bid price of Scancell shares increased from 7.0p to 13.5p from the start of the financial year to the financial year end. During this period, it was decided to harvest a modest portion of our shareholding and we now hold 12 million shares. Omega benefited from its involvement in a partnership to develop a C-19 antibody test and the share price rose significantly; the Board, therefore, decided it was appropriate to take advantage of this and we sold our entire holding for £987k, generating a profit over original cost of £659k and over our holding value at 31 December 2019 of £666k.

As a result of the realisations noted above, your Board were very pleased to be able to pay dividends totalling 13p per Ordinary share during the year with no material adverse impact on the Ordinary pool’s NAV. The Total Return in relation to the Ordinary shares is now 95.5p comprising cumulative distributions of 65.25p per Ordinary share and a residual NAV per Ordinary share of 30.2p as at 31 December 2020.

As previously reported, the Board remains focused on identifying exit opportunities for the remainder of the Ordinary share pool investment portfolio, and it was particularly pleasing to have been able to distribute 13p per Ordinary share to shareholders this year with no material adverse impact on the Ordinary share pool’s NAV. Realisations in the last three years have enabled the payment of a total of 41p per Ordinary share in dividends to Ordinary shareholders, representing 64.3% of the NAV per Ordinary share as at 31 December 2017 and we still retain net assets of 30.2p per Ordinary share as at 31 December 2020. Notwithstanding this success, we remain confident that, overall, there remains the opportunity to realise further value for Ordinary shareholders in due course (particularly in relation to our Scancell holding): indeed as noted below, earlier this month we realised a further portion of our Scancell holding. For the time being, we do not currently consider it appropriate to liquidate any further Scancell shares and do not see any other immediate opportunities for realisations, but we continue to monitor the situation closely.

Ordinary Shares - Investment Portfolio

The remaining Ordinary share portfolio now comprises one AIM quoted holding, Scancell, as referred to above, which has a carrying value of £1,620k as at 31 December 2020, and six unquoted holdings – the carrying value of three of which have been reduced to zero with the combined carrying value of the other three being £521k as at 31 December 2020.

Shareholders will note therefore that Scancell represented more than 75% of the value of the Ordinary share portfolio as at 31 December 2020 and as a result the NAV per Ordinary share now fluctuates largely in line with the movement in the Scancell share price. Whilst the Scancell share price showed volatility during 2020, it is not our policy to update the market following each of these fluctuations unless there are considered to be abnormal events (e.g. sale of a significant holding – see below). Your Board therefore recommends that shareholders or prospective shareholders keep the Scancell share price under review and consider its impact on the Ordinary share NAV per share before taking any action in relation to an existing or prospective holding in the Company’s Ordinary shares.

Further details in relation to the Ordinary share pool’s investment portfolio are included in the Investment Manager’s Report on pages 28 to 35.

Ordinary Shares – Update and Outlook

As referred to above, and following recent press coverage, the share price of Scancell has risen significantly from 13.5p at 31 December 2020 and was 24.5p at 19 February 2021. We are pleased that the market is recognising the continuing developments at Scancell and have taken the opportunity to realise a further modest part of our holding by selling 1 million shares at 21.7p per Scancell share. Our current holding is 11 million shares and we continue to believe that there is further upside in this holding.

This increase in the share price has given rise to a significant rise in the NAV per Ordinary share. Based on the NAV at 31 December 2020, adjusted solely for the uplift in valuation of our Scancell shares , the Ordinary share unaudited NAV per share was 44.0p at 19 February 2021.

The Ordinary share pool retained a cash balance of £527k as at 31 December 2020 in order to make follow-on investments into existing Ordinary share portfolio companies where the Board believes this will protect the Ordinary share pool’s existing investment and/or improve the overall prospects of a timely exit from the investee company. This has been increased to £744k following the recent sale of Scancell shares. Despite several of the Ordinary share pool portfolio companies seeking further funds during the year, we did not consider the terms attractive nor likely to improve the overall prospects for a timely realisation from the investee company and therefore no further Ordinary share pool investments were made.

Ordinary shareholders will recall that, following the appointment of Seneca as Investment Manager in August 2018, the Ordinary share pool incurs no running costs until July 2021.

Fund Raising

During the year the Company has allotted 2,701,500 B shares raising gross proceeds of £2,403k in the process. The current B share Offer will remain open until May 2021.

Annual General Meeting

The Company’s AGM will be held as a closed meeting at 14.00 on Monday, 29 March 2021 at the Company’s registered address 9 The Parks, Haydock, WA12 0JQ in accordance with the provisions of the Corporate Insolvency and Governance Act 2020. In light of the unprecedented restrictions on movement and gatherings due to the C-19 pandemic, shareholders will not be permitted to attend this year’s AGM and the meeting will take place with either two Directors who hold shares in the Company or one Director and an investment manager from Seneca Partners, who is also a shareholder, present only, to constitute the minimum quorum for the AGM to take place under the Company's articles of association and company law requirements. Shareholders should note that only the formal business set out in the Notice of AGM will be considered at the AGM.

Although shareholders will not be permitted to attend the AGM this year there will be a shareholder update presentation by the Investment Manager and a question and answer (“Q&A”) session at 10:00 on 8 March 2021, further details of which are included below and on https://senecavct.co.uk/march-2021-shareholder-presentation/.

Shareholders wishing to vote on any of the matters of business are urged to do so through completion of a proxy form appointing the Chairman of the AGM, which can be submitted to the Company’s Registrar. Proxy forms should be completed and returned in accordance with the instructions thereon and the latest time for the receipt of proxy forms is 14.00 on Saturday, 27 March 2021. Proxy votes can be also be submitted by CREST.

All resolutions will be decided by a poll and therefore it is essential that shareholders wishing to vote submit their proxy forms by 14.00 on Saturday, 27 March 2021.

Shareholders will have the opportunity to ask questions prior to submitting their proxy votes at the shareholder update presentation on 8 March 2021 as detailed below.

The Board has reviewed my performance and has asked me to continue as Chairman. A resolution for my re-election is included in the AGM Notice. Resolutions for the re-election of Alex Clarkson, Richard Manley and Richard Roth are also included in the AGM Notice.

The Notice of the AGM includes resolutions empowering the Directors to issue further B shares following the date of the AGM, which will primarily be used for the issue of B shares under a further Offer which we intend to launch for the 2021/2022 tax year. This requires authorisation for the Directors to be able to allot up to a further 35,000,000 B shares. Including these resolutions in the AGM business will avoid the Company having to produce and send out a separate circular to convene a separate general meeting.

The Notice of the AGM also includes a resolution to adopt amended Articles of Association which are substantially in the same form as the Company’s current Articles of Association but will allow, inter alia, the holding of partially virtual AGMs and to increase the total remuneration of the Directors to allow for the recruitment of a new non-executive Director. Further details of the differences between the two sets of Articles are set out in the Directors’ Report on pages 48 to 49.

A summary of the resolutions to be proposed by the Company at the AGM is included on pages 48 to 49.

Shareholder Update Presentation

Due to government restrictions impacting shareholders’ ability to attend the 2021 AGM as a result of the C-19 pandemic, a virtual shareholder update presentation will take place at 10:00 on Monday, 8 March 2021. Shareholders can register to attend the presentation by visiting:

·https://zoom.us/webinar/register/WN_UyGALLGCQCusM0gYuvud0A.

Further details about the shareholder event can be found on https://senecavct.co.uk/march-2021-shareholder-presentation/.

A Q&A session will take place where shareholders will have the opportunity to submit questions directly which we will seek to answer during the presentation. Questions can be submitted by emailing them to enquiries@senecavct.co.uk. Both the questions and answers will be published on the Company’s website following the presentation.

VCT Qualifying Status

Philip Hare & Associates LLP provides the Board with advice on the ongoing compliance with HMRC rules and regulations concerning VCTs; they have confirmed that the Company remains within all the appropriate VCT qualifying regulations as at 31 December 2020. In respect of the 80% Qualifying Holdings test, as at the end of December 2020 the percentage is 100% by virtue of a disregard of disposal proceeds, of which there have been £1.1m of relevant share sales (exit proceeds that occurred in the prevailing 12-month period are deducted from the total investments balance). Note, these exit proceeds are only deducted to the point that the test reaches 100% but without these the Company was still well above the 80% qualifying requirement. As at 31 December 2020 39% of funds raised in the year to 31 December 2019 had been invested in qualifying investments for the 30% minimum requirement.

Fund Administration

Our administration is conducted by Seneca at the Company’s registered address. Neville Registrars Limited (“Neville”) continue to maintain the shareholder register. All information in respect of both share classes including Annual Reports and notices of meetings can be found on our website www.senecavct.co.uk. We would remind shareholders who have not opted for electronic communications that this is more efficient and ecologically friendly than receiving paper copies by post and therefore encourage you to contact Neville, whose details are on page 101, to advise them of your wish to switch to electronic communication.

Auditor

UHY Hacker Young LLP have audited the Company’s annual results for the year ending 31 December 2020, and shareholders will be asked to reappoint them at the AGM for the audit of the accounts for the year ending 31 December 2021.

Future Prospects

We are pleased that Seneca have continued to develop the portfolio of B share pool investee companies during the year. The B share portfolio includes a mix of both unquoted and AIM quoted investments and whilst progress of these investments to date has been generally positive, the Board and Seneca remain acutely aware of the need to continue to work at close quarters with all B share portfolio companies as they navigate the challenges ahead resulting from the C-19 pandemic.

We also note that Seneca expect to see an increase in the number of businesses seeking investment to support their growth plans over the next 12 months as a result of the C-19 pandemic. With over £4.5 million of cash on the B share pool balance sheet at 31 December 2020. Seneca believe they are very well placed to continue to support the existing B share investment portfolio as well as adding attractive new growth capital investments to the B share portfolio from the strong pipeline of opportunities presented to them. We therefore look forward to the continued development of the B share portfolio in due course.

Your Board continues to view the future of our Company with confidence.

John Hustler
Chairman
22 February 2021

Investment Manager’s Report

We are pleased to set out in this section further details in relation to the development of both the B and Ordinary share pools and their respective investee companies during 2020.

The B Share Pool

Fundraising

Our second B share offer was concluded in July 2020, bringing total funds raised to £7.2 million and our fund-raising efforts have since continued under our third B share Offer that was launched in October 2020, with £1.5 million being raised under this third Offer as at 31 December 2020. We were encouraged by the funds raised in the two months immediately following launch and remain focused on increasing the size of the B share pool, which will in turn allow us to increase the number and diversity of new investments that we make.

Performance and Dividends

Despite the unprecedented economic climate and general turmoil of financial markets occasioned by the C-19 pandemic, we are pleased with the development of the B share portfolio, with six additional investments being made in the year. We are also pleased to report an increase in the NAV Total Return per B share, from 96.1p at 31 December 2019 to 97.8p as at 31 December 2020.

This increase in NAV Total Return per B share was the result of a slight reduction in the B share NAV as at 31 December 2020 (which fell to 91.8p per B share (2019: 93.1p)) which was more than explained by the payment of two B share dividends totalling 3.0p during the year.

These two B share dividends paid during the year were in line with the Company’s ambition to continue to pay dividends on the B shares and it should be noted that the Company has sufficient distributable reserves to enable the continued declaration of B share dividends over the medium term subject to Board approval, the B share pool investment pipeline and liquidity levels.

AIM Quoted Investments

With the AIM market demonstrating a heightened level of volatility during the year as a result of the impact of C-19, we took the opportunity to realise just over half of the B share pool’s shareholding in OptiBiotix plc (“OptiBiotix”) (an investment made during the year), selling 400,000 shares and realising a gain of £92k on the disposal (1.6x cash return in just 2 months following the original investment). We also sold our full holding in Genedrive (another investment made in the year) which is the B share pool’s first full exit and generated a profit of £136k versus original cost (2.1x cash return).

We were also encouraged that the during the year we saw an increase in the bid price of the two largest B share pool AIM quoted investments: the SkinBio share price increased to 22.0p as at 31 December 2020 (a 57% increase from 14p as at 31 December 2019) and the OptiBiotix share price increased to 57.0p as at 31 December 2020 (a 42.5% increase from the cost price of 40p per share).

Co-investing With Seneca EIS Funds

More generally we continue to develop Seneca’s position in the market as an active growth capital investor and as at 31 December 2020, we have raised and deployed c.£100 million of EIS and VCT investment funds into over 50 SME companies, through over 100 funding rounds, since we undertook our first EIS investment in 2012. This includes £8.7 million raised to date by the B share pool.

The ten investments in the B share portfolio had a value of £3,982k as at 31 December 2020 and are co-investments with EIS funds also managed by Seneca. We believe that the opportunity for the Company’s B share pool to co-invest with EIS funds that are also managed by Seneca provides the B share pool with a number of advantages including being able to participate in a higher number of investments, of a larger scale, into more established businesses than would be possible for the B share pool on a standalone basis.

Further, as a result of our position in the UK market as an active growth capital investor we maintain a strong pipeline of investment opportunities, particularly in the North of England, with a focus on well managed businesses with strong leadership teams that can demonstrate established and proven concepts in addition to growth potential. We aim to invest in both unquoted and AIM quoted companies and are pleased to have completed three additional AIM quoted investments in the year.

Investee Company Updates

We are very happy with the development of the B share investment portfolio. As noted above, we are delighted to have been able to include some AIM quoted investments in these early investments and are also very happy that by 31 December 2020 we had already been able to exit some of these at a profit so early in the development of those businesses (1 full exit and 2 partial exits). These early profits have supported the performance of the B share pool NAV at the same time as we continue to develop the unquoted company investment portfolio.

We are excited about the potential that lies with the B share investment portfolio and have included updates in relation to all of the B share pool investee companies later in this Investment Manager’s Report but wanted to highlight in particular the progress being made by B share pool investee companies SilkFred Limited (“SilkFred”) and SkinBio below and also comment on the reduction in fair value introduced against the carrying value of Qudini.

SilkFred

SilkFred is an online marketplace which specialises in independent ladies’ fashion brands. The B share pool invested £500k in SilkFred in December 2018 and the business made strong progress throughout the first year of our investment building a strong reputation and brand in the “event driven” fashion space.

As you would expect however, this left the business exposed to the impact of the C-19 pandemic in 2020 which brought about a fall in sales levels as a result of the reduction in the number of celebrations and events which previously drove the company’s growth.

Notwithstanding this, SilkFred’s recovery from the UK’s first lockdown was swift and Gross Marketplace Value (total sales value sold through the SilkFred platform) during the summer months of 2020 actually exceeded that of 2019. The business traded well for the rest of the year, remaining profitable throughout, buoyed by the loyalty shown by the customer base. The management team continue to view their market position positively and are looking to the future with confidence, particularly in anticipation of the return of their core markets as the UK emerges from lockdown. We too, are excited about SilkFred’s future.

SkinBio

SkinBio is an AIM quoted life science company focused on skin health and the B share pool invested £750k in February 2019 at 16p per share. The business made excellent progress during 2020 including raising c£4.45m of funds from new and existing investors, successfully accelerating the project timeline for its food supplement programme and gaining commercial interest for its MediBiotix™ and CleanBiotix™ programmes. The SkinBio share price closed on 31 December 2020 at 22p per share.

Having initially invested in SkinBio in February 2019, we sold 175,000 shares in early June 2019 at a profit of c1.5x original cost reducing the remaining holding to 4,502,107 shares. We did not sell any shares in 2020; however following the 31 December 2020 year end, the positive progress being made by SkinBio translated into further increases in the share price and we are pleased to report that we have taken the opportunity to take some profit from this investment. We sold 1,750,000 shares in January 2021 (37% of the B share pool’s original holding of 4,677,107 shares) reducing the remaining holding to 2,752,107 shares. These were sold at a net average price of 35.5p per share providing a return in the region of 2.2x on original cost.

The business is well funded, is targeting a valuable market with unmet cosmetic and clinical needs and we remain confident of SkinBio’s long-term prospects of success.

Qudini

Qudini is a UK based market leading provider of queue management software for enterprise brands. It generates the vast majority of its revenue from bricks and mortar retailers. Given the level of uncertainty caused in this core market by C-19, we took the prudent decision to reduce the carrying value of the B share pool’s investment in Qudini by 40% as at 30 June 2020. Whilst there has been some improvement in the trading performance of Qudini in H2 2020, some uncertainty remains over the future of its core bricks and mortar retail market. Therefore, we have maintained the 40% reduction in fair value and this investment was held at 60% of cost as at 31 December 2020.

Investments made after the Year End and outlook

Following the year end we also completed an additional unquoted company investment into Solascure Ltd (“Solascure”) for £500k. Solascure is an early stage wound care specialist which was originally spun out of (and continues to work alongside) world leading German biotech company BRAIN engaged in the development of a new-to-market wound care product. Solascure is also backed by strategic investor Eva Pharma and the business will commence their first clinical trial in 2021. Solascure’s Aurase product is a gel-based product that efficiently and gently cleans wounds, making the healing process much more straightforward.

We look forward to continuing to increase the funds raised for the B share pool under the current Offer and with several new investment opportunities in the later stages of due diligence, we expect to add to the portfolio of B share investee companies in the coming months.

Investment Portfolio – B shares

Unquoted Investments

Equity
held
%

Investment at cost £'000

Unrealised profit/(loss) £'000

Carrying
value at
31 December 2020
£'000

Movement
in the year to
31 December 2020
£'000

Fabacus Holdings Limited

2.0

500

63

563

-

Silkfred Limited

<1.0

500

-

500

-

Old St Labs Limited

3.8

500

-

500

-

Ten80 Ltd

7.5

400

-

400

-

Qudini Limited

2.4

500

(200)

300

(200)

Bright Network Ltd

1.7

234

-

234

-

ADC Biotechnology Ltd

<1.0

150

-

150

-

Total unquoted investments

2,784

(137)

2,647

(200)

Quoted Investments

Shares held

Investment at cost £'000

Unrealised profit/(loss) £'000

Carrying
value at
31 December 2020 £'000

Movement
in the year to
31 December 2020
£'000

SkinBioTherapeutics Plc

4,502,107

720

270

990

360

OptiBiotix plc

350,000

140

60

200

60

Abingdon Health plc

156,250

150

(5)

145

(5)

Total quoted investments

1,010

325

1,335

415

Total investments

3,794

188

3,982

215


Exits for the period

Investment Date

No. of Shares sold

Investment at cost £'000

Sale Proceeds £’000

Realised profit/(loss) £'000

Exit Multiple

OptiBiotix Health Plc*

April 2020

400,000

160

252

92

1.6

Genedrive Plc

May 2020

157,437

126

262

136

2.1

Total

286

514

228

1.8

*Partial exit

B Share Pool – Investment Portfolio – Top Six Unquoted Investments by value as at 31 December 2020

1. Fabacus Holdings Limited

Initial investment date:

February 2019

Fabacus is an independent software company that has developed a complete product lifecycle solution: Xelacore, aimed at bringing transparency to supply chain networks, with an initial focus on resolving the interaction and information flow between global licensors and their licensees.



Currently, there is a fundamentally flawed data capture process between licensors and licensees; and a disconnection from the framework of retail standards that have underpinned and continue to enable the retail value chain. This has resulted in an inability to correctly address known shortcomings in respect to data management and hinder the needed digital transformation of licensors in the digitally evolving retail landscape.



Fabacus’s solution, Xelacore, is a modular, Software as a Service solution with an intuitive interface and proprietary data aggregation and management engine that allows all stakeholders to operate on a single unified and collaborative platform. It bridges the gaps in an inefficient process within the current retail ecosystem by creating authenticated, enriched universal records that unlock opportunities, reduce risk and drive performance for both licensors and licensees.



Progress made by the company in 2020 includes:



·Continuing to make excellent progress with a number of customers, most notably through its promising relationship with Amazon.



·Onboarding fee-paying licensees to their market leading data platform and starting to generate revenue from their relationship with IMG (#1 global licensing agency).



·Successfully raising c.£1m to fund the working capital requirements of the company and to onboard the growing customer pipeline.



·Collaborating with Amazon to provide a version of the company’s technology which has the ability to identify and remove any counterfeit products from online marketplaces. In turn this has driven a significant increase in interest in and demand for Fabacus’ platform and ancillary services which has translated into increased commercial activity and revenue in recent months.

Cost:

£500,000

Valuation:

£563,000

Equity held:

2.0%

Last statutory accounts:

31 August 2019

Turnover:

Not disclosed

Loss before tax:

Not disclosed

Net assets:

£7.6 million

Valuation method:

Price of last fundraise

2. SilkFred Limited

Initial investment date:

December 2018

SilkFred is an online marketplace for independent ladies’ fashion brands. The business was founded in 2011 with the aim of creating an efficient marketplace for emerging fashion designers to bring products to market and establish their brand in the sector. The business now works with c.600 independent brands, selling to over 500k customers.



SilkFred acts as a central marketing and sales platform for these brands, charging commission in exchange for these services, and as a result the business itself takes minimal inventory / working capital risk on new brands, lines or products.



The business model revolves around a market leading and scalable customer service platform, and as such SilkFred are continually investing in core infrastructure and constantly seeking innovative methods to enhance the customer experience.



Progress made by the company in 2020 includes:

Cost:

£500,000

Valuation:

£500,000

Equity held:

<1%

Last statutory accounts:

31 December 2019

Turnover:

£20 million

Loss before tax:

£3.1 million

Net assets:

£4.4 million

Valuation method:

Cost and price of recent investment (reviewed for any fair value adjustment)

3. Old St Labs Limited

Initial investment date:

March 2019

Old St Labs is a provider of cloud based, supplier collaboration tools for large, blue chip customers, enabling them to manage key supplier relationships and strategic project work. The core product, Vizibl, seeks to make supplier collaboration much more straight forward, with key focus on compliance, savings / efficiency and driving growth across the business.



Vizibl is the only SaaS workspace that supports collaborative supplier relationships, bringing all points of contact together in one place, providing visibility across the company and eliminating duplication of efforts. Vizibl’s real-time reporting speeds up decision making, drawing on and sharing the expertise of the community in the process. The offering taps into a growing trend in supplier collaboration, having moved on from the initial focus on compliance, to an increased emphasis on savings / efficiency, and recent developments highlighting the benefits in terms of wider growth strategy for large customers.



Vizibl provides the infrastructure, governance and reporting capabilities to optimise present supplier performance and acts as a springboard for those collaborative supplier relationships. The product is CRM / ERP agnostic, working alongside all major software providers to ensure the collaboration software is insightful and informative.



Progress made by the company in 2020 includes:

Cost:

£500,000

Valuation:

£500,000

Equity held:

3.8%

Last statutory accounts:

31 March 2020

Turnover:

Not disclosed

Loss before tax:

Not disclosed

Net assets:

£260,000

Valuation method:

Cost and price of recent investment (reviewed for any fair value adjustment)

4. Ten80 Group Limited

Initial investment date:

March 2020

Based in Hammersmith, Ten80 Group Limited (“Ten80”) was established in early 2019. The company is a SAP focussed on-demand outcome-based delivery solution. SAP is best known for producing enterprise resource planning software which allows organisations to manage business operations across procurement, manufacturing, service, sales, finance, and HR.



Ten80’s aim is to connect every SAP customer with every SAP consultant globally, delivering outcome-based projects rather than time-driven costs through the contractor or freelancer marketplace.



The SAP global consultancy market is estimated to be worth in excess of £300bn.



Progress since our investment:

Cost:

£400,000

Valuation:

£400,000

Equity held:

7.5%

Last statutory accounts:

31 December 2019

Turnover:

Not disclosed

Loss before tax:

Not disclosed

Net assets:

£30,000

Valuation method:

At cost (reviewed for any fair value adjustment)

5. Qudini Limited

Initial investment date:

April 2019

Founded in 2012, Qudini is a B2B software company that provides customer experience SaaS solutions to organisations in retail, hospitality, the public sector and healthcare.



Qudini provides a software solution for appointment bookings, queue management, event management and task management – enabling businesses to improve shop floor operations by managing staff activity, breaks and performance, and by assigning tasks at store or head office level.



Qudini is aiming to revolutionise digital queue and appointment management. It achieves this through deployment of its data-centric, cloud-based (Amazon Web Services), cross-platform service, which improves a business’ ability to manage the flow of customers awaiting service, using algorithms to provide accurate, live data, such as estimated wait times. Through integration with various software platforms and compatible with wide variety of hardware, Qudini enables detailed analytics focused on customer trends, and provides a unique insight into areas such as customer footfall, peak demand times, and wait times.



2020 update:



Cost:

£500,000

Valuation:

£300,000

Equity held:

2.4%

Last statutory accounts:

31 December 2019

Turnover:

Not disclosed

Loss before tax:

Not disclosed

Net assets:

£3.1 million

Valuation method:

At cost, less a 40% reduction in fair value to reflect potential impact of C-19 on the company’s core UK markets

6. Bright Network (UK) Limited

Initial investment date:

March 2020

Bright Network (UK) Limited (“Bright”) is a Human Resources technology platform designed to enable leading employers to reach, identify and recruit high quality graduates and young professionals. At the time of our investment, the platform supported a network of over 255,000 high calibre candidates and has 300+ leading employers within its customer base, including multiple high-quality blue-chip clients. These employers utilise Bright’s services to fill annual intern and graduate recruitment scheme places, as well as any bespoke recruitment requirements.



Data analytics and machine learning is utilised to support and continuously improve identification of the best-suited talent to each employer. Bright provides a free service to undergraduates, personalising careers advice and job matches to support their career journey. The database is therefore a growing data-rich asset, processing 30 million pieces of data on a new generation of young professionals.



In March 2020, the VCT invested £234,000, as part of a larger £3.5m fundraise to allow the company to increase the size of its digital and talent solutions’ sales and marketing resources, together with improvements to the technical platform to drive additional service revenues.



Progress since our investment:



·Limiting the potential impact of C-19 by cutting its cost base and through the launch of online internships which were extremely well received over the summer. This has resulted in an increase in registered users to over 350,000.



·Trading ahead of expectations. Due to the pandemic the sales season (which typically ends at the end of August) has been extended, and the company continues to be on track to surpass the £2.5M revenue target for the financial year ending 31 March 2021 (FY21).

·Delivering strong top line performance coupled with tight cost control has resulted in the company outperforming FY21 planned gross profit and EBITDA.


·Delivering an improved cash position which is £900k ahead of budget. This outperformance alongside business agility puts the company in a strong position as the UK recovers from the C-19 pandemic. However, whilst more macro-economic uncertainty remains, this investment will continue to be held at cost.

Cost:

£234,000

Valuation:

£234,000

Equity held:

1.7%

Last statutory accounts:

31 March 2020

Turnover:

Not disclosed

Loss before tax:

Not disclosed

Net assets:

£4.9 million

Valuation method:

At cost (reviewed for any fair value adjustment)

B Share Pool - Investment Portfolio – AIM Quoted Investments as at 31 December 2020

1. SkinBioTherapeutics Plc

Initial investment date:

February 2019

SkinBioTherapeutics is a life science company focused on skin health. The company's proprietary platform technology, SkinBiotixTM, is based upon discoveries made by Dr. Cath O'Neill and Professor Andrew McBain.



SkinBioTherapeutics' platform applies research discoveries made on the activities of lysates derived from probiotic bacteria when applied to the skin. The company has shown that the SkinBiotixTM platform can improve the barrier effect of skin models, protect skin models from infection and repair skin models. Proof of principle studies have shown that the SkinBiotixTM platform has beneficial attributes applicable to each of these areas.



The aim of the company is to develop its SkinBiotixTM technology into commercially successful products supported by a strong scientific evidence base. SkinBioTherapeutics’ commercial strategy is to engage health and wellbeing and/or pharmaceutical companies in early dialogue to build up relationships and maintain communication on technical progress until one or more commercial deals can be secured.



Progress made by the company in 2020 includes:





Cost (of the portion of the original investment still held as at 31 December 2020):

£720,000

Valuation:

£990,000

Equity held:

2.9%

Last statutory accounts:

30 June 2020

Turnover:

£nil

Loss before tax:

£1.6 million

Net assets:

£2.5 million

Valuation method:

Bid price of 22p per share

2. OptiBiotix Health Plc

Initial investment date:

April 2020

OptiBiotix Health PLC is a Life Sciences business operating in one of the most progressive areas of biotechnological research, developing technologies that modulate the human microbiome – the collective genome of the microbes in the body. The business identifies and develops microbial strains, compounds and formulations for use in food ingredients, supplements and active compounds that can impact on human physiology, deriving potential health benefits.



With an established pipeline of microbiome modulators, the OptiBiotix team works today in the prevention and management of chronic lifestyle diseases including obesity, hypercholesterolemia and lipid profiles, and diabetes.



To date, the company has signed in excess of 50 commercial deals globally to supply or licence its suite of products/supplements to manufacturers and retailers and has launched a number of its own brand products. The VCT invested £300,000 into a £1m fundraise in April 2020, with funds being used to launch its award-winning products across Asia and the US, through partners who have an international reputation and significant retail network, as well as further expanding the portfolio of products. Between investment and 31 December 2020 53% of the shares originally acquired have been realised at a 60% profit.



Progress since our investment:



·Announcing positive half year results for the 6 month period to 30 June 2020 including:
o H1 revenue growth of £745k.
o a 5x increase in revenues from H1 2019.
o a 15.5% reduction in other administration costs.
a 50% reduction in loss compared to the same period in the prior year.



The company is now at a commercial turning point with the business model now proven through growing sales from proven products, established partners in multiple international territories, and reduced administration and R&D costs. We believe the company is therefore well placed to attack the various attractive markets in which they are gaining traction.



Optibiotix’s first generation products, SlimBiomeTM, and LPLDLTM, are now established scientifically, clinically, and commercially with products being sold in over 120 countries around the world and a growing brand presence.



As sales and profitability in first generation products continues to improve, there is an expectation this should enhance the company’s reach into new application areas and territories, and commercialise next generation products – all of which have the ability to further enhance the scale and growth prospects of the company.

Cost (of the portion of the original investment still held as at 31 December 2020):

£140,000

Valuation:

£200,000

Equity held:

<1.0%

Last statutory accounts:

31 December 2019

Turnover:

£745,000

Loss before tax:

£2.2 million

Net assets:

£5.2 million

Valuation method:

Bid price of 57p per share

3. Abingdon Health plc

Initial investment date:

December 2020

Abingdon Health is a specialist outsourced Contract Development and Manufacturing Organisation (CDMO) providing a full suite of services to the lateral flow diagnostic market. It is the lead member of the UK’s Rapid Test Consortium (UK-RTC) for a point-of-need C-19 antibody test (AbC-19) and is investing in automated manufacturing to significantly increase capacity and attract new customers across a range of sectors.



As the lead member of UK-RTC, the company co-ordinated a consortium of four companies (including former Ordinary share portfolio company Omega) and, in under four months, successfully developed and validated a rapid lateral flow test (“AbC-19”) for detecting SARS-CoV-2 IgG antibodies. The UK Government has ordered the first 1m devices and provided funding for the components for a further 9m to be delivered in the coming months. There is a mechanism by which Abingdon Health can sell any excess supply externally and it has already had significant interest from a number of third parties. It is also working with a number of partners on rapid antigen tests, leveraging its key lateral flow competencies and offering broad exposure in C-19 diagnostics. The pandemic has driven a material step change in demand for lateral flow tests generally and has catalysed a number of other C-19 and non-C-19 contract development and manufacturing opportunities.



Abingdon Health has established relationships with blue chip partners and a strong pipeline of potential new business, including a number of signed and qualified opportunities. It also has an innovative and proprietary mHealth solution, AppDx, a customisable smartphone reader that is capable of quantitative analysis of lateral flow tests and the transfer of real-time data.



The investment was completed just before the end of the financial year, so there is no further progress to report from 2020.

Cost:

£150,000

Valuation:

£145,000

Equity held:

<1.0%

Last statutory accounts:

30 June 2019

Turnover:

£2.3 million

Loss before tax:

£1.5 million

Net assets:

£6.2 million

Valuation method:

Bid price of 93p per share

B Share Pool – Investment Portfolio – Post-balance sheet Investments as at 22 February 2021

1. Solascure Ltd

Initial investment date:

January 2021

Solascure is an early stage wound care specialist, originally spun out of and working alongside BRAIN (world leading German biotech company), to develop a new-to-market wound care product. In 2019, the company deconsolidated from BRAIN and brought in additional strategic investment from Eva Pharma (c.£2m) and is now set to commence clinical trials of its wound care product Aurase. Solscure’s Aurase is a gel-based product that efficiently and gently cleans wounds, making the healing process much more straightforward. Pre-clinical work has been extremely positive and the clinical trial planning process is now well progressed.



Chronic wounds are a growing global problem, and alternative methods of treatment for hard to heal wounds are extremely expensive, impractical and slow. Solascure’s proprietary technology utilises the key mechanism of maggot debridement without the cost or labour input of live maggots. In simple terms, it uses maggot elements to facilitate and promote the body’s own wound cleansing processes. Core benefits of the product are the clear practical elements, as well as the reduced time scale to full debridement without delaying wound healing.



SolasCure have an approved protocol for a clinical study in order to reach market authorisation, which is anticipated to commence in early 2021 (with phase 1 anticipated to conclude by the end of the year). Crucially, the product permits the use of the main maggot-derived wound debriding enzyme without the cost or labour input involved with the use of live maggots, but also augments and synergises the body’s own wound cleansing processes. The product is expected to demonstrate 3 key benefits: 1) Specific swift destabilisation of fibrin debris; 2) No irritation or damage to healthy tissue; 3) Reducing the time to full debridement without delaying wound healing.



In January 2021, the VCT invested £500,000, alongside £733,000 of Seneca EIS funds as part of a £2.9m fundraise to allow the company to progress and complete the full trial (Phase 1 and 2) by the end of 2022.

Cost:

£500,000

Valuation:

£500,000

Equity held:

2.8%

Last statutory accounts:

30 June 2019

Turnover:

Not disclosed

Loss before tax:

Not disclosed

Net assets:

£ 6.7 million

Valuation method:

At cost

The Ordinary Share Pool

Shareholders will recall that whilst Seneca is the Company’s Investment Manager, responsibility for the management of the Ordinary share pool investments continues to rest with those remaining members of the Board of Directors who were serving at the point of Seneca’s appointment on 23 August 2018, which now includes John Hustler and Richard Roth.

AIM Quoted Investments

The Ordinary share pool’s largest investment is AIM quoted Scancell and this represented 37% of the Ordinary share pool’s NAV as at 31 December 2019 when the Scancell share price was 7.0p. During the year, the Scancell share price almost doubled and ended the year at 13.5p. In view of this increasing share price, the Company took the opportunity to realise some profit and sold a small portion of our Scancell shares during the year (1,049,730 shares (8%) were sold from a holding at the start of the year of 13,049,730 shares) realising £127k and generating a profit versus original cost of £64k (a 2x return on the original investment) and a profit versus the 31 December 2019 carrying value of £54k. The Ordinary share pool’s remaining stake in Scancell of 12,000,000 shares increased by £780k during the year to stand at a value of £1,620k as at 31 December 2020.

The Ordinary share pool’s investment in AIM quoted Omega gained significant traction in the year following its involvement in a partnership to develop a C-19 antibody test. The share price rose substantially from its 31 December 2019 price when it was 14p and this allowed the Company to sell the Ordinary share pool’s entire holding of 2,293,868 Omega shares in the year for a total of £987k. This generated a profit versus original cost of £659k (a 3x return on the original investment) and similarly a profit of £666k versus its 31 December 2019 value.

Unquoted Investments

With regard to the Ordinary share pool’s unquoted investments, the carrying value of OR Productivity Limited (“ORP”) and Fuel 3D Technologies Limited (“Fuel 3D”) were both reduced as a result of fundraises by these companies in 2020. In the case of ORP, the dilutive impact of the funds raised are such that the Company reduced the carrying value to £nil for the Ordinary share pool’s investment in ORP as at 31 December 2020 (31 December 2019 carrying value: £233k) and in the case of Fuel 3D the carrying value has been reduced to bring it in line with the price of their 2020 fundraise. Although the Ordinary share pool has maintained the value of Arecor Ltd at the price of the last fundraising in 2018, it continues to make excellent technical and commercial progress.

Performance and Dividends

As a result of the above AIM quoted investee company realisations, the Ordinary share pool was able to pay dividends totalling 13p per Ordinary share during the period.

The Total Return in relation to the Ordinary shares is now 95.5p comprising cumulative distributions of 65.25p per Ordinary share and a residual NAV per Ordinary share of 30.2p as at 31 December 2020.

As noted in the Chairman’s statement, the Company is focussed on realising assets in the Ordinary share pool at the appropriate time with the proceeds then being distributed to Ordinary shareholders as dividends – it is therefore noteworthy that in the 3 years to 31 December 2020 the Company has paid out dividends totalling 41p per Ordinary share (equivalent to 64.3% of the NAV per Ordinary share of 63.8p as at 31 December 2017) and the Ordinary share pool also retains NAV per Ordinary share of 30.2p as at 31 December 2020.

Investment Portfolio – Ordinary shares

Unquoted Investments

Equity
held
%

Investment at cost £'000

Unrealised profit/(loss) £'000

Carrying value at
31 December 2020
£'000

Movement
in the year to
31 December 2020
£'000

Arecor Limited

1.1

142

63

205

-

Fuel 3D Technologies Limited

<1.0

299

(104)

195

(81)

Insense Limited

4.6

509

(388)

121

-

OR Productivity Limited

3.7

765

(765)

-

(232)

Microarray Limited

3.0

132

(132)

-

-

ImmunoBiology Limited

1.2

868

(868)

-

-

Total unquoted investments

2,715

(2,194)

521

(313)

Quoted Investments

Shares held

Investment at cost £'000

Unrealised profit/(loss) £'000

Carrying value at
31 December 2020 £'000

Movement
in the year to
31 December 2020
£'000

Scancell plc

12,000,000

726

894

1,620

780

Total quoted investments

726

894

1,620

780

Total investments

3,441

(1,300)

2,141

467


Exits for the period

Investment Date

No. of Shares sold

Investment at cost £'000

Sale Proceeds £’000

Realised profit/(loss) £'000

Exit Multiple

Scancell plc *

December 2003

1,049,730

63

127

64

2.0

Omega Diagnostics plc

August 2007

2,293,868

328

987

659

3.0

Exosect Limited **

January 2010

8,575

270

-

(270)

-

Total

661

1,114

453

1.7

*Partial exit
**Dissolved 24 January 2020

Ordinary Share Pool – Investment Portfolio – All Six Unquoted Investments by value as at 31 December 2020

1. Arecor Limited

Initial investment date:

January 2008

Arecor was a spin-out from Insense (a Seneca Growth Capital Ordinary share investee company – see below) to commercialise technology developed by Insense for enabling biologics to maintain their integrity without the need for refrigeration - this both reduces cost and also helps supply chain logistics in developing countries where temperature monitored cold storage facilities are in short supply.



Progress made by the company in 2020 includes:



Cost:

£142,000

Valuation:

£205,000

Equity held:

1.1%

Last statutory accounts:

31 December 2019

Turnover:

£748,000

Loss before tax:

£2.7 million

Net assets:

£4.2 million

Valuation method:

Price of last fundraise

2. Fuel 3D Technologies Limited

Initial investment date:

March 2010

In 2014 Fuel 3D was formed to acquire the computer 3D imaging IP of Seneca Growth Capital Ordinary share investee company, Eykona. The initial application for this IP targeted by Eykona was measuring the volume of chronic wounds; however this has since developed and the current application focus is on a) measuring tumours in animals used in drug development via a product called BioVolume and b) enabling the manufacture of products to fit a particular individual e.g. masks used to treat certain medical conditions.

BioVolume is Fuel 3D’s lead product and improves measurement accuracy, inter-operator consistency, animal welfare, cost efficiencies, compliance and the success of pre-clinical oncology research.

Progress made by the company in 2020 includes:

Cost:

£299,000

Valuation:

£195,000

Equity held:

< 1%

Last statutory accounts:

31 December 2019

Turnover:

£521,000

Loss before tax:

£4.3 million

Net assets:

£5.4 million

Valuation method:

Price of last fundraise

3. Insense Limited

Initial investment date:

July 2003

Insense is an innovative, biotechnology company and was spun-out from Unilever’s R&D laboratory in 2001.

It has since had two successful spinouts, namely Arecor (see above) and Archimed, from which Microarray (see below) was also spun-out. Current Insense development activity is concentrated on dermatology products for both professional and consumer applications.



Progress made by the company in 2020 includes:



·Completing testing of the UV lamp that will be used in a first-in-man trial and continuing preparations for further formulation and stability testing. C-19 has affected progress in 2020, slowing the speed of product and service delivery from Chinese and UK-based partners.



Cost:

£509,000

Valuation:

£121,000

Equity held:

4.6%

Last statutory accounts:

31 December 2019

Turnover:

Not Disclosed

Loss before tax:

Not Disclosed

Net liabilities:

£51,000

Valuation method:

Price of last fundraise

4. OR Productivity Limited

Initial investment date:

March 2011

At the end of 2011, Freehand 2010 (a Seneca Growth Capital Ordinary share investee) was acquired by OR Productivity plc (ORP) in exchange for ORP shares.

Freehand 2010 owns the intellectual property to technology incorporated in a product, FreeHand, for robotically controlling the laparoscope (part of the camera system) used in the growing sector that is keyhole surgery. The company sells the system outright and provides consumables although, increasingly, the business model is built upon free placement of the system with recurring revenue then being generated from the subsequent sale of a consumable per operation.

Progress made by the company in 2020 includes:



The current fundraising has been through the issue of A Ordinary shares which carry a one times repayment preference. In addition further A Ordinary shares with the same preference have been issued to redeem certain outstanding liabilities. At the present time the Board considers it unlikely that the Ordinary share pool investment in ORP can be valued in excess of the value of the A Ordinary shares issued. The Ordinary share pool does not hold any A Ordinary shares.

Cost:

£765,000

Valuation:

£nil

Equity held:

3.7%

Last statutory accounts:

31 March 2020

Turnover:

Not Disclosed

Loss before tax:

Not Disclosed

Net liabilities:

£4.6 million

Valuation method:

Carrying value reduced to £nil

5. ImmunoBiology Limited

Initial investment date:

November 2005

ImmunoBiology (“ImmBio”) is a biotechnology company that is focused on developing treatments for illnesses such as meningitis, tuberculosis, influenza and hepatitis C. The company’s technology is based on the discovery that a group of proteins known as ‘heat shock proteins’ has a pivotal role in controlling the normal immune response to infections. The focus is currently on a vaccine for Pneumococcal Disease, for which the challenge is that there are >90 strains in circulation but present treatments address only a small proportion. In 2016 a first in human study demonstrated safety in adults.



ImmBio - formally known as ImmunoBiology Ltd has licensed its pneumococcal vaccine to China National Biotech Group. It has completed certain parts of its technology transfer and is now seeking to start a phase 2 study of the same vaccine. Coronavirus has again highlighted the importance of vaccines to the world and in recent years pneumococcal disease has claimed a similar number of deaths as C-19 in 2020. An existing vaccine has reduced the death rate, but the existing vaccines only protect against fewer than 20 of the 90 or so existing strains. As ImmBio’s ImmBioVax technology utilises heat shock proteins to activate T-cell responses, it is hoped that it can be used to create vaccines for a wide range of currently poorly served infectious diseases.



ImmBio has a complex equity structure which has impacted the investment valuation. As such, the Board does not believe that the Company’s Ordinary share pool’s investment currently has any value.



Progress made by the company in 2020 includes:





Almost all staff are currently furloughed, whilst further funds can be obtained.

Cost:

£868,000

Valuation:

£nil

Equity held:

1.2%

Last statutory accounts:

31 May 2020

Turnover:

£nil

Loss before tax:

£594,000

Net assets:

£262,000

Valuation method:

Carrying value reduced to £nil

6. Microarray Limited

Initial investment date:

January 2011

Microarray Ltd is a UK-based specialist wound healing company. Founded in 2000, Microarray was de-merged from Archimed, a spin-out from Insense (see above): the company is now privately owned.

The company has access to wide ranging expertise in the fields of wound dressing product development, marketing and sales; electrochemistry and diagnostic sensor technologies; biochemistry, oxygen and iodine chemistry; enzymology, immunology and inflammation. Current research and development activities are concentrated on innovative wound care diagnostics.

Microarray owns and continues to develop new intellectual property in its specialist fields. It works independently and with expert academic and industrial partners.

Progress made by the company in 2020 includes:

Previously product testing results have not provided the indicators that the company hoped for in terms of assessing whether a wound is infected or not. As a result of this adverse outcome in relation to an area of focus for the company, the carrying value of the investment of the Ordinary share portfolio’s investment in Microarray Limited has been reduced to £nil. Notwithstanding the above, the company is continuing to develop its wound diagnostic products as the progress in 2020 indicates.

Cost:

£132,000

Valuation:

£nil

Equity held:

3.0%

Last statutory accounts:

31 December 2019

Turnover:

Not Disclosed

Loss before tax:

Not Disclosed

Net liabilities:

£(4 million)

Valuation method:

Carrying value reduced to £nil

Ordinary Share Pool – Investment Portfolio – AIM Quoted Investment as at 31 December 2020

1. Scancell plc

Initial investment date:

December 2003

Scancell is an AIM listed biotechnology company that is developing a pipeline of therapeutic vaccines to target various types of cancer, with the first target being melanoma.



The Immunobody platform technology, in effect, educates the immune system how to respond – this means that the technology can also be licensed to pharmaceutical companies to assist the development of their own therapeutic vaccines, which is an area of emerging importance for which a number of big pharmas do not have in-house technology. In addition, in 2012 a second platform technology, Moditope, was announced and is based on exploiting the normal immune response to stressed cells and is complementary to the Immunobody platform. The AvidMab platform was established in 2018 which allows direct tumour killing.



Scancell continues to develop its multiple technologies. Progress made by the company in 2020 includes:





As a result of these developments, the Scancell share price has seen much volatility with prices ranging from 4p to 20p during the year. These valuations are based on a bid price of 13.5p per share and the bid price was 24.5p per share at 19 February 2021.

Cost (of the portion of the original investment still held as at 31 December 2020):

£726,000

Valuation:

£1,620,000

Equity held:

1.5%

Last statutory accounts:

30 April 2019

Turnover:

£nil

Loss before tax:

£6.7 million

Net assets:

£9.3 million

Valuation method:

Bid price of 13.5p per share

Richard Manley
Seneca Partners Limited
22 February 2021

Directors’ Report

The Directors present their Report and the audited Financial Statements for the year ended 31 December 2020.

The Directors consider that the Annual Report and Financial Statements, taken as a whole are fair, balanced and understandable and provide the information necessary for shareholders to assess the Company’s performance, business model and strategy.

Review of Business Activities

The Directors are required by section 417 of the Companies Act 2006 to include a Business Review to shareholders. This is set out on page 36 and forms part of the Strategic Report. The purpose of the Business Review is to inform members of the Company and help them assess how the Directors have performed their duty under section 172 of the Companies Act 2006 (duty to promote the success of the Company). The Company’s section 172 Statement on page 6, the Chairman's Statement on page 8 to 13, and the Investment Manager’s Report on pages 14 to 35 also form part of the Strategic Report.

The purpose of this review is to provide shareholders with a snapshot summary setting out the business objectives of the Company, the Board’s strategy to achieve those objectives, the risks faced, the regulatory environment and the key performance indicators used to measure performance.

Directors’ Shareholdings – Ordinary shares

The Directors of the Company during the period and their interests (in respect of which transactions are notifiable under Disclosure and Transparency Rule 3.1.2R) in the issued Ordinary shares of 1p are shown in the table below:

31 December 2020

31 December 2019

Number of Shares

Number of Shares

John Hustler

190,000

190,000

Alex Clarkson

-

-

Richard Manley

-

-

Richard Roth

209,612

209,612

All of the Directors’ shares were held beneficially. There have been no changes in the Directors’ Ordinary share interests between 31 December 2020 and the date of this report.

Directors’ Shareholdings – B Shares

The Directors of the Company during the period and their interests (in respect of which transactions are notifiable under Disclosure and Transparency Rule 3.1.2R) in the issued B shares of 1p are shown in the table below:

31 December 2020

31 December 2019

Number of Shares

Number of Shares

John Hustler

-

-

Alex Clarkson

-

-

Richard Manley

62,071

51,010

Richard Roth

15,000

15,000

All of the Directors’ B shares were held beneficially. There have been no changes in the Directors’ B share interests between 31 December 2020 and the date of this report.

Directors’ and Officers’ Liability Insurance

The Company has maintained directors’ and officers’ liability insurance cover on behalf of the Directors, Company Secretary and Investment Manager.

Whistleblowing

The Board has approved a Whistleblowing Policy for the Company, its Directors and any employees, consultants and contractors, to allow them to raise concerns, in confidence, in relation to possible improprieties in matters of financial reporting and other matters.

Bribery Act

The Board has approved an Anti-Bribery Policy to ensure full compliance with the Bribery Act 2010 and to ensure that the highest standards of professional and ethical conduct are maintained.

Management

Seneca as the Company’s Investment Manager is responsible for the management of the Company’s B share pool investments. Responsibility for the management of the Ordinary share pool investments has been delegated to those members of the current Board of Directors who served immediately prior to 23 August 2018, namely John Hustler and Richard Roth.

The strategies and policies which govern the Investment Manager have been set by the Board in accordance with section 172 of the Companies Act 2006.

Corporate Governance Statement

The Board has considered the principles and recommendations of the 2019 AIC Code. The Company’s Corporate Governance policy is set out on pages 50 to 54.

The 2019 AIC Code is available on the AIC website (www.theaic.co.uk). It includes an explanation of how the 2019 AIC Code adapts the Principles and Provisions set out in the UK Corporate Governance Code (the “UK Code”) to make them relevant for investment companies.

The Company has complied with the recommendations of the 2019 AIC Code and the relevant provisions of the UK Corporate Governance Code, except as set out below:

  • The Company does not have a Chief Executive Officer or a Senior Independent Director. The Board does not consider this necessary as it does not have any executive directors.

  • New Directors do not receive a formal induction on joining the Board, though they do receive one tailored to them on an individual basis.

  • The Company conducts a formal review as to whether there is a need for an internal audit function. However, the Directors do not consider that an internal audit would be an appropriate control for this VCT at this time.

  • The Company does not have a Remuneration Committee as it does not have any executive directors.

  • The Company does not have a Nomination Committee as these matters are dealt with by the Board.

For the reasons set out in the AIC Guide, and as explained in the UK Corporate Governance Code, the Board considers the above provisions are not relevant to the position of the Company, being an investment company run by the Board and managed by the Investment Manager. In particular, all of the Company’s day-to-day administrative functions are outsourced to third parties. As a result, the Company has no executive directors, employees or internal operations.

Directors

Biographical details of the Directors are shown on page 42.

In accordance with the Articles of Association and good governance, all four Directors will retire and offer themselves for re-election at the forthcoming AGM.

The Board is satisfied that, following individual performance appraisals, the Directors who are retiring continue to be effective and demonstrate commitment to their roles and therefore offer themselves for re-election with the support of the Board. Further details regarding the Company’s succession planning are set out in the Corporate Governance policy on pages 51 to 52.

The Board did not identify any conflicts of interest between the Chairman’s interest and those of the shareholders, especially with regard to the relationship between the Chairman and the Investment Manager.

No concerns about the operation of the Board or the Company were raised by any Director during the period and had any been raised they would be mentioned in the minutes or in writing to the Chairman to be circulated to the Board in accordance with Provision 5.2 of the 2019 AIC Code.

The Board is cognisant of shareholders’ preference for Directors not to sit on the boards of too many listed companies (“over-boarding”). The Board is satisfied that all Directors have the time to focus on the requirements of the Company.

International Financial Reporting Standards

As the Company is not part of a group it is not mandatory for it to comply with International Financial Reporting Standards (“IFRS”). The Company does not anticipate that it will voluntarily adopt IFRS. The Company has adopted Financial Reporting Standard 102 – The Financial Reporting Standard Applicable in the United Kingdom and the Republic of Ireland.

Environmental, Social and Governance (“ESG”) Practices

The Board recognises the requirement under section 414c of the Companies Act 2006 to detail information about environmental matters (including the impact of the Company’s business on the environment), employee and human rights, social and community issues, including information about any policies it has in relation to these matters and effectiveness of these policies.

Given the size and nature of the Company’s activities and the fact that it has no employees and only four non-executive Directors, the Board considers there is limited scope to develop and implement environmental, social and community policies, but recognises the importance of including consideration for such matters in investment decisions. The Board has taken into account the requirement of section 172(1) of the Companies Act 2006 and the importance of ESG matters when making decisions which could impact shareholders, stakeholders and the wider community. The Company’s Section 172(1) statement has been provided in the Strategic Report on page 6, where the Directors consider the information to be of strategic importance to the Company.

The Company seeks to ensure that its business is conducted in a manner that is responsible to the environment. The management and administration of the Company is undertaken by the Investment Manager who recognises the importance of its environmental responsibilities, monitors its impact on the environment and implements policies to reduce any negative environmental impact and which promote environmental sustainability.

The Investment Manager recognises that managing investments on behalf of clients involves taking into account a wide set of responsibilities in addition to seeking to maximise financial returns for investors. Industry practice in this area has been evolving rapidly and the Company seeks to be an active participant by working to define and strengthen its principles accordingly. This involves both integrating ESG considerations into the Investment Manager’s investment decision-making process as a matter of course, and also signing up to major external bodies who are leading influencers in the formation of industry best practice. The following is an outline of the kinds of ESG considerations that the Investment Manager is taking into account as part of its investment process.

Environmental

Seneca, as part of its commercial due diligence practices and ongoing monitoring, examines potential issues which could arise from supply chains, climate change and environmental policy compliance. The Investment Manager looks for management teams who are aware of the issues and are proactive in responding to them.

Social

Seneca seeks to avoid unequivocal social negatives, such as profiting from forced labour within its investment portfolio and to support positive impacts which will more likely find support from customers and see rising demand. Seneca does not tolerate modern slavery or human trafficking within its business operations and takes a risk-based approach in respect of our portfolio companies. Seneca actively engages with portfolio companies and their boards to discuss material risks, ranging from business and operational risks to environmental and social risks.

Governance

Seneca examines and, where appropriate, engages with companies on board membership, remuneration, conflicts of interest such as related party transactions, and business leadership and culture. In addition, the Company, as a matter of course, exercises its voting rights when possible.

Greenhouse Gas (“GHG”) Emissions and Streamlined Energy & Carbon Reporting (“SECR”)

Under the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013 (‘the 2013 Regulations’) and the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018, quoted companies of any size are required under Part 15 of the Companies Act 2006 to disclose information relating to their energy use and GHG emissions.

All of the Company’s activities are outsourced to third parties. The Company therefore has no greenhouse gas emissions to report from its operations, nor does it have direct responsibility for any other emissions producing sources under the Companies Act 2006 (Strategic Report and Directors’ Reports) Regulations 2013 and the Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018. For the same reasons as set out above, the Company considers itself to be a low energy user under the SECR regulations and therefore is not required to disclose energy and carbon information. A low energy user is defined as an organisation that uses 40 MWh or less during the reporting period.

Going Concern

The Company’s business activities and the factors likely to affect its future performance and financial position are set out in the Chairman’s Statement and Investment Manager’s Report on pages 8 to 13 and pages 14 to 35. Further details on the management of the principal risks are set out on pages 39 to 40 and financial risks may be found in note 16 to the Financial Statements.

The Board receives regular reports from Seneca who acts as both the Investment Manager and the Administration Manager, and the Directors believe that, as no material uncertainties leading to significant doubt about going concern have been identified, it is appropriate to continue to adopt the going concern basis in preparing the Financial Statements.

The assets of the Company consist mainly of securities, four of which are AIM quoted, relatively liquid and readily accessible, as well as more than £5 million of cash as at 31 December 2020 (47% of net assets). After reviewing the Company’s forecasts and expectations, the Directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. The Company therefore continues to adopt the going concern basis in preparing its Financial Statements.

The Company is also facing risks resulting from the impact of the C-19 pandemic. The Company’s Board and Investment Manager are focused on ensuring that investee companies are taking the required actions to minimise the potential impact that the C-19 pandemic could have on them. The Board and Seneca will continue to review risks posed by C-19 and keep those risks under regular review but do not consider the pandemic to have any impact on the Company’s own ability to continue as a going concern.

Share Capital

As disclosed on page 99 the Board has authority to make market purchases of the Company’s own B shares. No shares were purchased by the Company during the year (2019: nil).

At the last AGM held on 28 April 2020, the Board received authority to allot up to 35,000,000 B shares in connection with any offer(s) for subscription (and any subsequent top up offer of B shares) and up to 405,800 Ordinary shares (for any miscellaneous offers of such shares), which represented approximately 479% of the Company’s issued B share capital and approximately 5% of its issued Ordinary share capital as at 28 April 2020.

During the year, the Company did not issue any Ordinary shares (2019: nil). During the year, the Company issued 2,701,500 B shares raising £2.4 million before expenses (2019: 2,325,078 shares and £2.3 million) No further shares have been issued between 31 December 2020 and the date of this report.

The Company’s issued Ordinary share capital as at 31 December 2020 was 8,115,376 Ordinary shares of 1p each (31 December 2019: 8,115,376 Ordinary shares of 1p each) and 9,062,948 B shares of 1p each (31 December 2019: 6,361,448 B shares of 1p each).

The total number of shares in issue for both the Ordinary shares and B shares of 1p each as at 31 December 2020 and 19 February 2021 was 17,178,324 (31 December 2019: 14,476,824) with each share having one vote.

In accordance with Schedule 7 of the Large and Medium Size Companies and Groups (Accounts and Reports) Regulations 2008, as amended, the Directors disclose the following information:

  • The Company’s capital structure and voting rights are summarised above, and there are no restrictions on voting rights nor any agreement between holders of securities that result in restrictions on the transfer of securities or on voting rights;

  • There exist no securities carrying special rights with regard to the control of the Company;

  • The rules concerning the appointment and replacement of directors, amendment of the Articles of Association and powers to issue or buy back of the Company’s shares are contained in the Articles of Association of the Company and the Companies Act 2006;

  • The Company does not have an employee share scheme;

  • There are no agreements to which the Company is party that may affect its control following a takeover bid; and

  • There are no agreements between the Company and its Directors providing for compensation for loss of office that may occur following a takeover bid or for any other reason, apart from their normal notice period and any fees potentially due under the performance fee arrangements set out on page 58 and note 6.

Substantial Shareholdings

At 31 December 2020 and at the date of this report, there was one holding of 3% and over of the Company’s ordinary share capital. This holding related to Share Nominees Ltd and amounted to 3.34%.

Annual General Meeting

The Notice convening the 2021 AGM of the Company is set out at the end of this document (and a form of proxy in relation to the meeting is enclosed separately). Part of the business of the AGM will be to consider resolutions in relation to the following matters:

Resolutions 3 to 6 will seek the re-election of the existing four members of the Board as non-executive Directors of the Company.

Resolution 7 will seek the re-appointment of UHY Hacker Young LLP as Independent Auditor to the Company.

Resolution 8 will seek authorisation to determine the auditor’s remuneration.

Resolution 9 will authorise the Directors to allot further B shares and Ordinary shares. This will enable the Directors until the next AGM to allot up to 35,000,000 B shares in connection with any offer(s) for subscription (and any subsequent top up offer of B shares) and up to 405,800 Ordinary shares (for any miscellaneous offers of such shares), representing approximately 386% of the Company’s issued B share capital and approximately 5% of its issued Ordinary share capital as at 19 February 2021.

Resolution 10 will authorise the Board, pursuant to the Act, to make one or more market purchases of up to 14.99% of the issued B share capital of the Company from time to time. The price paid must not be less than 1p per B share, nor more than 5% above the average middle market price of a B share for the preceding five business days. Any B shares bought back under this authority may be cancelled by the Board.

Resolution 11 will, under sections 570 of the Act, disapply pre-emption rights in respect of any allotment of the B shares and/or Ordinary shares authorised under Resolution 9.

Resolution 12 will adopt amended Articles of Association which are substantially in the same form as the Company’s current Articles of Association save that:

  1. existing Clause 146 regarding Unclaimed Dividends has been deleted and replaced with a new Clause 146 which provides the authorisation for all dividends, interest or other sum payable and unclaimed for 12 months after having become payable to be invested or otherwise made use of by the Board for the benefit of the Company until claimed and the Company shall not be constituted a trustee in respect thereof. All dividends unclaimed for a period of six years after having been declared or become due for payment shall (if the Board so resolves) be forfeited and shall cease to remain owing by the Company; and

  2. existing Clauses 53 to 56 (including the insertion of new Clauses 55A and 56A) have been amended to include the ability for the Company to hold partially virtual general meetings.

  3. Existing Clause 102 will be amended to authorise an increase in the total remuneration payable to the Directors to £100,000 to allow for the appointment of a new non-executive Director.

The Directors intend to use the authorities in Resolutions 9 and 11 for the purposes of the current Offer and a further offer for subscription of B shares. The Directors have no current intention to utilise the authority in relation to the Ordinary shares.

Copies of the Articles of Association of the Company (including a mark-up of the new articles of association proposed to be adopted pursuant to resolution 12) will be available for inspection at the registered office of the Company during usual business hours on any weekday (Saturday and Public Holidays excluded) from the date of this notice, until the end of the Annual General Meeting and at the place of the Annual General Meeting for at least 15 minutes prior to and during the meeting. However, given that shareholders will be unable to attend the AGM this year, the Articles of Association will also be available on the Company’s website at https://senecavct.co.uk/reports-documents/.

Recommendation

The Board believes that the passing of the resolutions above are in the best interests of the Company and its shareholders as a whole and unanimously recommends that you vote in favour of these resolutions as the Directors intend to do in respect of their beneficial shareholdings.

By Order of the Board

Craig Hunter
Company Secretary
22 February 2021

Combined Income Statement

Combined
Year to 31 December 2020

Combined
Year to 31 December 2019

Revenue

Capital

Total

Revenue

Capital

Total

Note

£’000

£’000

£’000

£’000

£’000

£’000

Gain on disposal of fixed asset investments

-

948

948

-

52

52

Gain/(loss) on valuation of fixed asset investments

-

682

682

-

(752)

(752)

Income

2

-

-

-

-

-

-

Performance fee

6

-

(140)

(140)

-

136

136

Investment management fee net of cost cap

3

(10)

(31)

(41)

(7)

(21)

(28)

Other expenses

4

(150)

(2)

(152)

(123)

-

(123)

Return on ordinary activities before tax

(160)

1,457

1,297

(130)

(585)

(715)

Taxation on return on ordinary activities

7

-

-

-

-

-

-

Return on ordinary activities after tax

(160)

1,457

1,297

(130)

(585)

(715)

Return on ordinary activities after tax attributable to:

Owners of the fund

(160)

1,457

1,297

(130)

(585)

(715)

There was no other Comprehensive Income recognised during the year

  • The ‘Total’ column of the income statement and statement of comprehensive income is the profit and loss account of the Company; the supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies.

  • All revenue and capital items in the above statement derive from continuing operations.

  • The Company has only one class of business and derives its income from investments made in shares and securities and from bank and money market funds.

  • The Company has two share classes, the Ordinary share and B share class.

The Company has no recognised gains or losses other than the results for the year as set out above.

The accompanying notes are an integral part of the Financial Statements.

Ordinary Share Income Statement
(non-statutory analysis)

Ordinary shares
Year to 31 December 2020

Ordinary shares
Year to 31 December 2019

Revenue

Capital

Total

Revenue

Capital

Total

Note

£’000

£’000

£’000

£’000

£’000

£’000

Gain on disposal of fixed asset investments

-

720

720

-

38

38

Gain/(loss) on valuation of fixed asset investments

10

-

467

467

-

(725)

(725)

Income

2

-

-

-

-

-

-

Performance fee

6

-

(140)

(140)

-

136

136

Investment management fee

3

-

-

-

-

-

-

Other expenses

4

-

(2)

(2)

4

-

4

Return on ordinary activities before tax

-

1,045

1,045

4

(551)

(547)

Taxation on return on ordinary activities

7

-

-

-

-

-

-

Return on ordinary activities after tax

-

1,045

1,045

4

(551)

(547)

Return on ordinary activities after tax attributable to:

Ordinary shareholders

-

1,045

4

(551)

(547)

Earnings per share – basic and diluted

8

0.0p

12.8p

12.8p

0.0p

(6.7)p

(6.7)p

B Share Income Statement (non-statutory analysis)

B shares
Year to 31 December 2020

B shares
Year to 31 December 2019

Revenue

Capital

Total

Revenue

Capital

Total

Note

£’000

£’000

£’000

£’000

£’000

£’000

Gain on disposal of fixed asset investments

-

228

228

-

14

14

Gain/(loss) on valuation of fixed asset investments

10

-

215

215

-

(27)

(27)

Income

2

-

-

-

-

-

-

Performance fee

6

-

-

-

-

-

-

Investment management fee net of cost cap

3

(10)

(31)

(41)

(7)

(21)

(28)

Other expenses

4

(150)

-

(150)

(127)

-

(127)

Return on ordinary activities before tax

(160)

412

252

(134)

(34)

(168)

Taxation on return on ordinary activities

7

-

-

-

-

-

-

Return on ordinary activities after tax

(160)

412

252

(134)

(34)

(168)

Return on ordinary activities after tax attributable to:

B shareholders

(160)

412

252

(134)

(34)

(168)

Earnings per share – basic and diluted

8

(2.2)p

5.7p

3.5p

(2.5)p

(0.7)p

(3.2)p

Combined Statement of Changes in Equity

Share capital

Share
premium

Special distributable reserve

Capital reserve realised gains/
(losses)

Capital reserve holding gains/
(losses)

Revenue reserve

Total

£’000

£’000

£’000

£’000

£’000

£’000

£’000

Balance as at 1 January 2019

121

568

10,839

1,029

(1,309)

(1,967)

9,281

B share issue

24

2,238

-

-

-

-

2,262

Revenue return on ordinary activities after tax

-

-

-

-

-

(130)

(130)

Expenses charged to capital

-

-

-

(21)

-

-

(21)

Performance fee allocated as capital expenditure

-

-

-

136

-

-

136

Dividends paid

-

-

(2,444)

-

-

-

(2,444)

Current period gains on disposal

-

-

-

52

-

-

52

Current period losses on fair value of investments

-

-

-

-

(752)

-

(752)

Balance as at 31 December 2019

145

2,806

8,395

1,196

(2,061)

(2,097)

8,384

B share issue

27

2,363

-

-

-

-

2,390

Revenue return on ordinary activities after tax

-

-

-

-

-

(160)

(160)

Expenses charged to capital

-

-

-

(33)

-

-

(33)

Performance fee allocated as capital expenditure

-

-

-

(140)

-

-

(140)

Dividends paid

-

-

(1,301)

-

-

-

(1,301)

Current period gains on disposal

-

-

-

948

-

-

948

Current period gains on fair value of investments

-

-

-

-

682

-

682

Prior years' unrealised losses now realised

-

-

-

(267)

267

-

-

Balance as at 31 December 2020

172

5,169

7,094

1,704

(1,112)

(2,257)

10,770

The accompanying notes are an integral part of the Financial Statements.

Ordinary Shares - Statement of Changes in Equity

Share capital

Share
premium

Special distributable reserve

Capital reserve realised gains/
(losses)

Capital reserve holding gains/
(losses)

Revenue reserve

Total

£’000

£’000

£’000

£’000

£’000

£’000

£’000

Balance as at 1 January 2019

81

-

7,412

1,047

(1,309)

(1,949)

5,282

Revenue return on ordinary activities after tax

-

-

-

-

-

4

4

Performance fee allocated as capital expenditure

-

-

-

136

-

-

136

Dividends paid

-

-

(2,272)

-

-

-

(2,272)

Current period gains on disposal

-

-

-

38

-

-

38

Current period losses on fair value of investments

-

-

-

-

(725)

-

(725)

Balance as at 31 December 2019

81

-

5,140

1,221

(2,034)

(1,945)

2,463

Revenue return on ordinary activities after tax

-

-

-

-

-

-

-

Expenses charged to capital

-

-

-

(2)

-

-

(2)

Performance fee allocated as capital expenditure

-

-

-

(140)

-

-

(140)

Dividends paid

-

-

(1,055)

-

-

-

(1,055)

Current period gains on disposal

-

-

-

720

-

-

720

Current period gains on fair value of investments

-

-

-

-

467

-

467

Prior years' unrealised losses now realised

-

-

-

(267)

267

-

-

Balance as at 31 December 2020

81

-

4,085

1,532

(1,300)

(1,945)

2,453

B Shares - Statement of Changes in Equity

Share capital

Share
premium

Special distributable reserve

Capital reserve realised gains/
(losses)

Capital reserve holding gains/
(losses)

Revenue reserve

Total

£’000

£’000

£’000

£’000

£’000

£’000

£’000

Balance as at 1 January 2019

40

568

3,427

(18)

-

(18)

3,999

B share issue

24

2,238

-

-

-

-

2,262

Revenue return on ordinary activities after tax

-

-

-

-

-

(134)

(134)

Expenses charged to capital

-

-

-

(21)

-

-

(21)

Dividends paid

-

-

(172)

-

-

-

(172)

Current period gains on disposal

-

-

-

14

-

-

14

Current period losses on fair value of investments

-

-

-

-

(27)

-

(27)

Balance as at 31 December 2019

64

2,806

3,255

(25)

(27)

(152)

5,921

B share issue

27

2,363

-

-

-

-

2,390

Revenue return on ordinary activities after tax

-

-

-

-

-

(160)

(160)

Expenses charged to capital

-

-

-

(31)

-

-

(31)

Dividends paid

-

-

(246)

-

-

-

(246)

Current period gains on disposal

-

-

-

228

-

-

228

Current period gains on fair value of investments

-

-

-

-

215

-

215

Balance as at 31 December 2020

91

5,169

3,009

172

188

(312)

8,317


Combined Balance Sheet



Combined as at
31 December 2020

Combined as at
31 December 2019

Note

£'000

£'000

£'000

£'000

Fixed asset investments*

10

-

6,123

4,761

Current assets:

Debtors

11

7

-

3

Cash at bank and in hand

5,056

3,909

Creditors: amounts falling due within one year

12

(223)

-

(236)

Net current assets

4,840

3,676

Creditors: amounts falling due after more than one year

12

(193)

(53)

Net assets