New Century AIM VCT Plc UK Regulatory Announcement: Annual Financial Report

LONDON–(BUSINESS WIRE)– 

New Century AIM VCT plc

Audited Report and Accounts for the year to 28^th February 2021

Company number: 05352611

Financial Summary	1
Chairman’s Statement	2
Details of Directors	3
Management and Administration	4
Directors	5
Strategic Report	6
Investment Portfolio	8
Top Ten Investments	11
Directors’ Report	12
Directors’ Remuneration Report	16
Corporate Governance	18
Independent Auditor’s Report	22
Statement of Comprehensive Income	29
Balance Sheet	30
Statement of Changes in Equity	31
Cash Flow Statement	32
Notes to the Financial Statements	33 – 44
Shareholder Information	45

Financial Summary

	Year ended 28 February 2021	Year ended 29 February 2020
Revenue return per share (pence) for the year	(0.47)	0.19
Total return per share (pence) for the year	38.49	0.66
Interim dividend paid per share (pence)	1.50	0.00
Proposed final dividend per share (pence)	6.50	0.00
Net asset value per share (pence)	102.96	65.97
Cumulative value of shareholder investment (net asset value plus cumulative dividends per share) (pence)	131.78	93.29
Shareholders’ funds (£’000)	8,094	5,186

Chairman’s Statement

It is pleasing to report that following a very difficult period for the Market in March 2020, your fund regained all the declines in its net asset value (NAV) incurred during the early part of the year, and considerably outperformed its benchmark for the twelve months to 28 February 2021.

The NAV of your fund increased by 56.07% to 102.96p (when measured using bid-prices), compared to the FTSE AIM Allshare index which gained 38.13% over the same period. The net asset value plus cumulative dividends rose from 93.29p to 131.78p per share, being an increase of 41.26%.

It is also pleasing to note the further progress since the year end, and that the NAV of 120.02p per share reported for 28 May 2021 (based on mid-prices) is 14.33% higher than that reported, using the same measurement basis, at the 28 February 2021.

We appreciate income is important to our shareholders and the Board is therefore proposing that we pay a final dividend of 6.5p per share in respect of the year ended 28 February 2021. When this is added to the 1.5p interim dividend already paid, this results in a total dividend for the year of 8.0p and represents a yield of 8% based on the fund’s offer price of 100p on 28 May 2021.

The fund has made fifteen further qualifying investments in the period and we are pleased with their progress. We made twelve sales where we either exited or top-sliced a holding.

We are mindful that we could see further volatility this year as the economy has an initial boost from the reopening of lockdown measures, but this could be followed by some businesses starting to experience difficulties in the months ahead as Government support subsides, and the possibility of inflation may also raise its head. That said, the current year has started off positively as commented earlier and we have a wide spread of established companies across a variety of sectors within the fund, and we therefore look forward to the year ahead with optimism.

Finally, the Directors have a duty every five years to ask the shareholders of the Company if they wish the fund to carry on. Therefore, amongst the resolutions shareholders are being asked to vote on at the forthcoming AGM, there is an Ordinary Resolution offering shareholders the opportunity to vote on this particular matter.

Geoffrey Gamble

24 June 2021

Details of Directors

Michael Barnard (Aged 70)

Michael has been employed in stockbroking since 1971. In 1974 he became a Member of the Stock Exchange. During his career his duties have spanned investment advising, investment research, dealing and company management. In 1988 he started his own stockbroking company, MD Barnard & Company Limited which he subsequently sold on 30 November 2017.

Geoffrey Gamble (Aged 62)

Geoffrey started his career with National Westminster Bank plc. He joined Publishing Holdings plc in 1984 and became a director in 1986. He took part in an MBO in 1988, backed by Schroder Ventures (now Permira) to form Charterhouse Communications Group Limited and was instrumental in the satisfactory venture capital exit from that company and its flotation on AIM in 1996. He became managing director of Charterhouse Communications plc in 1999.

Peter William Riley (Aged 76)

Peter qualified as a solicitor in 1969. He retired from practice in 2018.

Ian Cameron-Mowat (Aged 70)

Ian has a BSc 1st degree in electronics and was involved in the early development of computers at Burroughs Machines. He is currently a consultant radiologist to a NHS Trust.

Simon Like (Aged 51)

Simon started his career working for Midland Bank, which later became HSBC plc, and has been employed in stockbroking since 2001. Since then Simon has been managing client money and is one of the senior fund managers at Oberon Investments Limited.

Management and Administration

Registered Office & Registered Number	4th Floor, 50 Mark Lane London EC3R 7QR Company Number: 05352611
Company Secretary	Tricor Secretaries Limited 4th Floor, 50 Mark Lane London EC3R 7QR
Registrar	Neville Registrars Limited Neville House Steelpark Road Halesowen B62 8HD
Solicitors	Dundas & Wilson 5th Floor, Northwest Wing Bush House Aldwych London WC2B 4EZ
Investment Manager and Broker	Oberon Investments Limited 1st Floor 12 Hornsby Square Southfields Business Park Basildon Essex SS15 6SD
Auditor	UHY Hacker Young LLP Quadrant House 4 Thomas More Square London E1W 1YW

Directors

Geoffrey Gamble (Chairman)

Michael David Barnard

Peter William Riley

Ian Cameron-Mowat

Simon Like

All directors are non-executive.

Audit Committee:

Geoffrey Gamble (Chairman)

Peter William Riley

Ian Cameron-Mowat

Strategic Report

Activities and status

The principal activity of the Company during the year was the making of long-term equity and loan investments in UK Listed, AIM traded and unquoted companies in the United Kingdom. The Company has been listed on the London Stock Exchange since 25 March 2005 and has been granted approval by Her Majesty’s Customs & Revenue as a Venture Capital Trust. The Chairman’s Statement on page 2 and the Investment Manager’s Review below give a review of developments during the year and of future prospects.

The directors consider that the Company was not at any time up to the date of this report a close company within the meaning of Section 414 of the Act.

Investment Manager’s Review

The FTSE AIM All Share index had a good performance throughout the year, although it started negatively with the index falling in early March 2020 as the outbreak of COVID19 started to spread across the world. Since then, however, the trend of the index has been generally up. Many investors started to look at the year as an exceptional year in terms of earnings’ declines, and looked more carefully at the position of companies’ finances and in particular their financial strength to trade successfully once the economy opened up again. We had a couple of false dawns when it was hoped that some sort of return to normality would occur only to be met with a second and third wave of the virus. It is now looking much brighter as the UK is undertaking what looks to be a successful mass vaccination programme which will hopefully allow businesses to open fully and unrestricted from 19 July 2021.

During the year to 28th February 2021 the net asset value (NAV) of your fund increased by 56.07% to 102.96p, compared to the FSTE AIM All Share index which gained 38.13% over the same period. The net asset value of the fund plus cumulative dividends per share increased by 41.26%.

The fund made fifteen qualifying investments in the period, investing in Actual Experience plc, Abingdon Health plc, AFC Energy plc, Deepmatter plc, Destiny Pharma plc, Eden Research plc, ECSC Group plc, Falanx Group plc, Feedback plc, Fusion Antibodies PLC, Gfinity plc, Intelligent Ultrasound Group plc, Mirriad Advertising plc, MyHealthCheck plc and Synairgen plc.

We made twelve sales during the year where we either exited or top-sliced a holding.

The current year has started well, with the NAV of the fund climbing to 120.02p by the end of May 2021 as there has been more optimism by both investors and companies over the prospects for the year ahead. Your fund has a wide spread of investments across a variety of many sectors and we believe that this diversification will help the Company weather any volatility that may occur in the period ahead. These are unprecedented times and with so many countries trying to contain the virus it is impressive how quickly numerous vaccines have been created to help fight the pandemic. We have also begun to see that some companies have recommenced dividend payments again, as they start to become more confident about their future cash flows and prospects. We are also continuing to see many companies using the public markets to raise cash to support their balance sheets and provide growth capital. This in itself can create new opportunities for your fund as it will give us the chance to invest in exciting new prospects.

I am proud about the way the fund has performed this year and I look forward to the year ahead with cautious optimism.

Investment Objective

New Century AIM VCT PLC is a Venture Capital Trust (“VCT”) established under the legislation introduced in the Finance Act 1995. The Company’s principal objectives as set out in the prospectus are to achieve long term capital growth through investment in a diversified portfolio of Qualifying Companies primarily quoted on AIM.

Principal risks and uncertainties

The Company invests its funds primarily in companies traded on AIM, which entail a higher degree of risk than investments in large listed companies. The main risk, therefore, arising from the Company’s activities is market price risk, representing the uncertain realisable values of the Company’s investments. Please refer to the Corporate Governance report on page 18 which provides evidence of the robust review the directors have performed to assess these risks, and also note 22 to these accounts which gives a detailed review of the Company’s risk management.

Environmental matters

Discussion in respect of environmental matters is not considered relevant or material to an understanding of the performance of the Company. The Company does not consider that Greenhouse Gas Emissions disclosure is relevant to the Company on the grounds of immateriality due to its not having its own premises or employees.

Key performance indicators

The financial key performance indicators are set out in the financial summary on page 1.

Viability Statement

In accordance with provision 1 of The UK Corporate Governance Code 2018 the directors have assessed the prospects of the Company over a longer period than the 12 months required by the “Going Concern” provision.

The Board regularly considers the Company’s strategy, including investor demand for the Company’s shares, and a three year period is therefore considered to be an appropriate and reasonable time horizon.

The Board has carried out a robust assessment of the principal risks facing the Company and its current position, including those which may adversely impact its business model, future performance, solvency or liquidity. The principal risks faced by the Company and the procedures in place to monitor and mitigate them are set out in note 22.

The Board has also considered the Company’s cash flow projections and found these to be realistic and reasonable.

Based on the above assessment the Board confirms that it has a reasonable expectation that the Company will be able to continue in operation and meet its liabilities as they fall due over the three year period to 28 February 2024.

Geoffrey Gamble

Chairman

24 June 2021

Investment Portfolio

Security	Original Cost	Valuation at 28 Feb’21	Cost	Valuation
	£	£	%	%
Qualifying Investments	6,753,744	7,794,913	91.77	95.91
Non-qualifying Investments	482,628	209,312	6.56	2.58
	7,236,372	8,004,225	98.33	98.49
Uninvested funds	123,089	123,089	1.67	1.51
	7,359,461	8,127,314	100.00	100.00
Qualifying Investments
AIM quoted
Abingdon Health plc	35,218	32,777	0.48	0.40
Access Intelligence plc	10,053	29,000	0.14	0.36
Actual Experience plc	63,174	70,638	0.86	0.87
AFC Energy	50,254	168,125	0.68	2.07
Angle plc	125,880	157,237	1.71	1.93
Anglo African Oil & Gas plc	45,229	675	0.61	0.01
Audioboom Group plc	178,406	308,880	2.42	3.80
Bango plc	7,563	36,225	0.10	0.45
Belvoir Lettings plc	23,320	32,800	0.32	0.40
Bigblu Broadband plc	239,452	391,788	3.25	4.82
Bilby plc	156,673	91,381	2.13	1.12
Blackbird plc	97,991	461,175	1.33	5.67
Bould Opportunities plc	35,179	0	0.48	0.00
Brighton Pier Group plc	50,253	11,031	0.68	0.14
C4X Discovery Holding plc	65,329	157,733	0.89	1.94
Cloudbuy plc	58,483	228	0.79	0.00
Cloudcall Group plc	20,230	30,100	0.27	0.37
Coral Products plc	118,095	83,333	1.60	1.03
Creo Medical Group plc	30,053	86,159	0.41	1.06
Cyanconnode Holdings plc	376,755	46,726	5.12	0.57
DCD Media plc	562,800	1,700	7.65	0.02
Deepmatter Group plc	49,754	81,840	0.68	1.01
Deepverge plc	121,304	93,840	1.65	1.15
Destiny Pharma plc	50,254	86,923	0.68	1.07
Diaceutics plc	10,314	17,415	0.14	0.21
DP Poland plc	20,113	11,939	0.27	0.15
Ecsc Group plc	20,104	23,637	0.27	0.29
Eden Research plc	30,152	97,000	0.41	1.19
Escape Hunt plc	31,006	5,530	0.42	0.07
Falanx Group Ltd	150,964	97,653	2.05	1.20
Faron Pharmaceuticals Ltd	25,128	32,650	0.34	0.40
Feedback plc	100,508	117,629	1.37	1.45
Fusion Antibodies plc	12,064	15,534	0.16	0.19
Gear4Music Holdings plc	27,121	150,070	0.37	1.85
Gfinity plc	116,218	153,829	1.58	1.89
Hunters Property plc	251,256	325,000	3.41	4.00
IDE Group Holdings plc	52,763	1,396	0.72	0.02
Security	Original Cost	Valuation at 28 Feb’21	Cost	Valuation
	£	£	%	%
Ideagen plc	28,430	227,117	0.39	2.79
Immotion Group plc	130,661	74,678	1.78	0.92
I-Nexus Global plc	70,353	5,494	0.96	0.07
Inspired Energy plc	51,370	259,133	0.70	3.19
Intelligent Ultrasound Group plc	170,848	149,908	2.32	1.84
K3 Business Technology Group plc	90,360	178,821	1.23	2.20
Keywords Studios plc	5,563	113,040	0.08	1.39
Lightwaverf plc	45,233	3,177	0.61	0.04
Location Sciences Group plc	132,946	29,161	1.81	0.36
M.Winkworth plc	64,320	108,800	0.87	1.34
Marechale Capital plc	133,828	65,323	1.82	0.80
Maxcyte Inc	25,128	348,212	0.34	4.28
Microsaic Systems plc	164,417	7,792	2.23	0.10
Mirriad Advertising plc	30,154	38,850	0.41	0.48
Myhealthchecked plc	200,550	366,282	2.73	4.51
N4 Pharma plc	60,304	54,600	0.82	0.67
Open Orphan plc	115,581	137,470	1.57	1.69
Pelatro plc	25,128	14,400	0.34	0.18
PHSC plc	182,910	45,500	2.49	0.56
Polarean Imaaging plc	30,154	129,600	0.41	1.59
Property Franchise Group plc	100,503	190,000	1.37	2.34
Quixant plc	6,935	17,700	0.09	0.22
Rosslyn Data plc	27,037	5,339	0.37	0.07
Scancell Holdings plc	130,618	217,361	1.77	2.67
Scholium Group plc	50,253	15,500	0.68	0.19
SEEEN plc	150,754	130,000	2.05	1.60
Solid State plc	40,134	125,070	0.55	1.54
SRT Marine Systems plc	27,139	52,500	0.37	0.65
Sysgroup plc	99,178	65,780	1.35	0.81
Tekcapital plc	77,499	52,200	1.05	0.64
Touchstar plc	281,400	88,750	3.82	1.09
TP Group plc	109,278	45,157	1.49	0.56
Tristel plc	38,409	578,592	0.52	7.12
ULS Technology plc	48,241	101,160	0.66	1.24
Verici Dx plc	35,178	119,875	0.48	1.47
Vianet Group plc	40,175	24,050	0.55	0.30
Total AIM quoted qualifying investments	6,537,622	7,794,913	88.83	95.91

Unlisted qualifying Investments
Invocas Group plc	100,400	0	1.36	0.00
Optare plc	45,027	0	0.61	0.00
Outsourcery plc	50,752	0	0.70	0.00
Syqic plc	19,943	0	0.27	0.00
Total Unlisted qualifying investments	216,122	0	2.94	0.00
Total Qualifying Investments	6,753,744	7,794,913	91.77	95.91
Security	Original Cost	Valuation at 28 Feb’21	Cost	Valuation
	£	£	%	%
Non-qualifying Investments
AIM quoted
Audioboom Group plc	1,163	429	0.02	0.01
Bango plc	291	414	0.00	0.01
Cyanconnode Holdings plc	131	8	0.00	0.00
Driver Group plc	8,992	5,000	0.12	0.06
Gateley Holdings plc	14,627	26,400	0.20	0.31
IDE Group Holdings plc	218	2	0.00	0.00
K3 Business Technology Grp plc	131	179	0.00	0.00
Rotala plc	60,795	51,644	0.83	0.64
Tristel plc	60	588	0.00	0.01
	86,408	84,664	1.17	1.04
UK Listed
Aviva plc	22,268	18,090	0.30	0.22
Centrica plc	10,074	1,582	0.14	0.02
Imperial Brands plc	23,764	13,325	0.32	0.16
Investec plc	202,821	70,975	2.77	0.88
Twentyfour Income Fund Ltd	9,852	9,360	0.13	0.12
Vodafone Group plc	20,590	11,316	0.28	0.14
	289,369	124,648	3.93	1.54
Unlisted Investments
China Food Company plc	65,969	0	0.91	0.00
Gable Holdings Inc	12,112	0	0.16	0.00
Mar City plc	10,053	0	0.14	0.00
Sorbic International plc	18,717	0	0.25	0.00
	106,851	0	1.46	0.00
Total non-qualifying investments	482,628	209,312	6.56	2.58
Security	Original Cost	Valuation at 28 Feb’21	Cost	Valuation
	£	£	%	%
Tristel plc	38,469	579,180	0.52%	7.13%
Blackbird plc	97,991	461,175	1.33%	5.67%
Bigblu Broadband plc	239,452	391,788	3.25%	4.82%
Myhealthchecked plc	200,550	366,282	2.73%	4.51%
Maxcyte Inc Com	25,128	348,212	0.34%	4.28%
Hunters Property plc	251,256	325,000	3.41%	4.00%
Audioboom Group plc	179,569	309,309	2.44%	3.81%
Inspired Energy plc	51,370	259,133	0.70%	3.19%
Ideagen plc	28,430	227,117	0.39%	2.79%
Scancell Holdings plc	130,618	217,361	1.77%	2.67%

The investments tabulated above are expressed as a percentage of the Company’s investment portfolio including uninvested cash.

Directors’ Report

The directors present their report and the audited financial statements for the year to 28 February 2021.

Corporate Governance

The Corporate Governance report on pages 18 to 21 forms part of the directors’ report.

Results and dividends paid

	Year to 28 February 2021		Year to 29 February 2020
	Revenue	Capital	Revenue	Capital
	£’000	£’000	£’000	£’000
Return on ordinary activities after taxation	(36)	3,063	15	38
Appropriated as follows:
Interim dividend paid in respect of current period
Revenue – Nil (Nil) per share	–	–	–	–
Capital – 1.50p (Nil) per share	–	(118)	–	–
Final dividend paid in respect of prior period
Revenue – Nil (0.186p) per share	–	–	(15)	–
Capital – Nil (3.314p) per share	–	–	–	(260)
Transfers to reserves	(36)	2,945	–	(222)

The directors propose to declare a final dividend for the year ended 28 February 2021 of 6.5p per share which, when added to the interim dividend of 1.5p per share (already paid on 4 December 2020), gives a total dividend for the year of 8.0p per share.

There was no dividend declared for the year ended 29 February 2020.

Directors

The directors of the Company are required to notify their interests under Disclosure and Transparency Rule 3.12R. The membership of the Board and their beneficial interests in the ordinary shares of the Company are set out below:

	Year ended 28 February 2021	Year ended 29 February 2020
Michael Barnard Geoffrey Gamble Peter William Riley Ian Cameron-Mowat	2,159,035 97,125 59,185 110,904	2,159,035 61,732 59,185 110,904
Simon Like	8,800	8,800

All of the directors’ share interests shown above are held beneficially. There have been no changes in the directors’ share interests between 28 February 2021 and the date of this report.

Brief biographical notes on the directors are given on page 3. The director, retiring in accordance with the Company’s Articles of Association, is Geoffrey Gamble, who being eligible will offer himself for re-election at the forthcoming Annual General Meeting (AGM). The directors believe his experience in small companies is a great benefit to the Board and recommend his re-election.

None of the directors has a contract of service with the Company and, except as mentioned below under the heading “Management”, there were no contracts that subsisted during the year in which a director was materially interested and which was significant in relation to the Company’s business.

Management

MD Barnard & Co. Ltd (now called Oberon Investments Limited) has acted as investment manager to the Company since inception. The principal terms of the Investment Management Agreement are set out in Note 6 to the Financial Statements.

Substantial shareholdings

As at 28 February 2021 the Company had been notified of the following shareholdings representing 3 per cent or more of the Company’s issued share capital during the year under review or at the date of this report:

	Number	Percentage of share capital
Michael Barnard Geoffrey Williams Nigel Shanks David Trotman John Brice Roger Carey	2,159,035 391,570 364,820 324,000 290,988 241,048	27.47% 4.98% 4.64% 4.12% 3.70% 3.07%

Acquisition of own shares

During the year the Company did not re-purchase any of its own shares.

Structure, rights and restrictions concerning the Company’s share capital

Throughout the Company’s financial year there were 7,860,937 ordinary shares in issue. No shares were issued or bought back during the year. The rights and obligations attached to the Company’s ordinary shares are set out in the Company’s Articles of Association, copies of which can be obtained from Companies House. The Company has only one class of ordinary share and each share has attached to it full voting rights, dividends and capital distribution rights (including on a winding up) and do not confer any rights of redemption.

Ordinary shareholders also have the right to receive copies of the Company’s report and accounts, to attend and speak at general meetings and to appoint proxies.

There is one shareholder, Michael Barnard, who is a major shareholder in the Company with a 27.47% shareholding. He is also a director of the Company and taken together he is considered to have a significant influence over the Company. Other than Michael Barnard, there are no other shareholders who have a significant direct or indirect shareholding in the Company.

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.

Appointment of Directors

The directors are subject to re-election by rotation, with one of the directors being re-elected annually at the AGM.

Creditor payment policy

The Company’s payment policy is to agree terms of payment before business is transacted and to settle accounts in accordance with those terms. The Company’s principal expenses such as investment management fees and administration fees are paid quarterly in arrears in accordance with the respective agreements. Accordingly the Company had no material trade creditors at the year end.

Streamlined Energy and Carbon Reporting

There are new reporting requirements which make it mandatory for companies to report the amount of energy they use during their financial year. The Company’s energy usage is below the de minimis level of 40,000kWh.

Post balance sheet events

Details of the post balance sheet event are set out in note 27.

Contacts

NEW CENTURY AIM VCT PLC

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