Interim Results

14th Sep 2009 10:27



14 September 2009

Rapid Realisations Fund Limited

Interim Results

Rapid Realisations Fund Limited (the "Company" or "Rapid"), the AIM quoted company which seeks to exploit the investment opportunity represented by companies in "pre-flotation" and other late stage situations, today announces its unaudited interim results for the six months ended 30 June 2009.

Investment Overview

As we have discussed in previous reports, the demand for growth capital has far exceeded our expectations. As a result of the continuing economic turmoil and reduced availability of credit we have seen this trend continue during the period under review; in the six months to 30 June 2009 we have reviewed in excess of 100 companies. Although the Company only made 3 new investments in the period the pipeline of investment opportunities is strong. 

As highlighted at the year end, exiting investments will be more difficult to achieve, but we continue to respond to this challenge by both strategically positioning the Company's investments to be attractive as trade disposals and by creating companies that have sufficient critical mass to be attractive to the stock market. We are optimistic that we will exit some investments next year, in line with the Company's original business plan.

Financial Highlights

Loss for the period of £0.7 million.

Net Asset Value per share at 30 June 2009 of 103.34p.

Cash and cash equivalents as at 30 June 2009 of £22.5 million.

Three new investments totaling circa £3.0 million.

Three follow on investments totaling circa £1.6 million. 

Since the Period End

One follow on investment of circa £550,000.

1.15 million shares have been repurchased by the Company at a price of 83p each.

Due diligence is being undertaken in relation to three potential investments with a total investment cost of circa £12 million.

Investment Highlights

During the six months to 30 June 2009 the Company made three new investments with a combined investment value of circa £3.0 million;

Information Prophets Ltd ("I-Prophets") is a spin out company from Manchester University providing specialist support and advice on energy efficiency, compliance and reduction of carbon emissions. I-Prophets have developed government-approved information management systems which track the energy performance of buildings and ensure that customers are able to comply with the latest legislation, in addition to providing the data needed by clients to improve efficiency and support their green initiatives.

Infinity SDC Ltd ("Infinity") design, build and operate secure data centres primarily for customers in the financial services and government sectors. The company has developed a modular build approach which reduces lead times and improves reliability of design and operation without sacrificing flexibility. Infinity have built up one of the most extensive knowledge bases of electrical and telecoms infrastructure outside the major utilities.

Wyatt Group Plc / Green CO2 Plc. During the period Green CO2 (an existing investee company) reversed into Wyatt Group Plc, an AIM quoted company providing advice and services in the areas of HR, employee benefits, employment tax, health and safety, childcare vouchers and pension administration. 

The newly formed group provides a range of regulatory, mandatory and compliance services to the corporate and public sector. The benefits of the new company is a wider product offering, improved overhead recovery, national sales, greater marketing coverage, a larger client and contact database and additional cross selling opportunities.

In addition the Company purchased 655,000 of its own shares at 83p each on 5 May 2009.

During the six months to 30 June 2009 the Company made 3 follow on investments totaling in excess of £1.6 million in existing investee companies.

DDM Europe AG ("DDM") are engaged in the acquisition and outsourced collection of distressed consumer debt portfolios from financial institutions. DDM are focused on the Eastern European consumer debt market and has a management team with an excellent track record in this market. During the period DDM made a further drawdown on the funding line put in place for the acquisitions of further portfolios. 

Take 2 Film Holdings Ltd hires out camera and grip equipment and provides associated services and products to production companies making dramas, features, commercials, promotional videos and corporate in-house shorts. During the period a further investment was made in the company to fund the continued development of the business. 

Taylormade Betting Ltd ("Taylormade") is an independent bookmaker chain. Following the Company's initial investment in March 2008, Taylormade has successfully increased the number of units it operates from 4 to 18. During the period the Company participated in a further round of fundraising which was successfully concluded by Taylormade in March 2009. This fundraising has provided sufficient funding to allow the company to continue to expand in the medium term. The fundraising was concluded at a valuation representing a 61% uplift on the valuation at which the Company originally invested in Taylormade.

In addition to the 6 investee companies highlighted above which received either initial or follow on investments during the period, there are a further 11 investee companies whose activities were summarised in the Company's year end accounts. Whilst trading conditions in the wider economy remain difficult we are happy with the development of the Company's portfolio of investments. Further, whilst the defensive nature of the Company's investments have provided protection against the worst effects of the current downturn, a number of the Company's investee companies have significant upside potential.

Since the end of June 2009 the Company has made one follow on investment of circa £550,000 in Deep Blue Restaurants Limited ("Deep Blue"), an existing investee company;

Deep Blue is one of the largest operators of fish and chip shops in the industry with a current portfolio of 29 shops. In July 2009 Deep Blue concluded a rights issue to raise funds for the completion of the rebranding of the existing 29 stores. At the same time as participating in the rights issue the Company also made an additional equity investment in Deep Blue.

In addition the Company has purchased 1.15 million of its own shares at 83p each on 2 July 2009.

Commenting, Peter Tom, Chairman:

"In light of the difficult market conditions the Company has made only 3 new investments totaling circa £3.0 million and 3 follow on investments totaling circa £1.6 million during the six months to 30 June 2009, however, our investment opportunities are substantial and we are currently undertaking due diligence on several potential investments. Further, due to the continuing restricted availability of credit and general economic uncertainty we have seen an increase in demand for the type of growth capital funding solutions provided by the Company.

We have been relatively defensive in our choice of investments and our current portfolio of investee companies continue to develop in line with expectations despite the challenging economic environment. The Net Asset Value per share as at 30 June 2009 was 103.34p, an increase of 1.34% since the last published Net Asset Value per share at 31 March 2009.

The difficult markets continue to create investment opportunities, but exits for our investments will be more difficult to achieve. We are however responding to this challenge by both strategically positioning our investments to be attractive as trade disposals and by creating companies that have sufficient critical mass to be attractive to the stock market."

Enquiries:

Steve Charnock

Cenkos Fund Managers Limited +44 (0)7770 363 683

Fund Manager [email protected] 

Philip Secrett

Grant Thornton Corporate Finance +44 (0) 20 7383 5100

Nominated Adviser [email protected]

Notes to Editors:

Rapid Realisations Fund Limited ("Rapid") is a closed ended investment fund listed on the AIM market of the London Stock Exchange (AIM). The investment objective of the fund is to seek to exploit the investment opportunity represented by companies in "pre-IPO" and other late stage situations with a view to arbitraging differences in public and private company valuations. The fund is managed by Cenkos Fund Managers Limited.

Statement of Financial Position

As at 30 June 2009

	Notes	Unaudited 30 June 2009	Audited 31 December 2008	Unaudited 30 June 2008
		£	£	£
Non-current assets	2 & 6
Investment designated as:
Fair value through profit or loss		19,257,259	19,086,705	22,784,104
Loans and receivables		18,036,173	15,454,815	-
Total investments		37,293,432	34,541,520	22,784,104
Current assets
Other receivables	7	913,691	600,750	281,304
Cash and cash equivalents	8	22,517,971	28,526,345	40,153,336
Amounts receivable on open forward foreign currency contract	9	923,970	-	-
		24,355,632	29,127,095	40,434,640
Current liabilities
Other payables	10	484,710	1,264,703	937,562
Net current assets		23,870,922	27,862,392	39,497,078
Total net assets		61,164,354	62,403,912	62,281,182
Equity attributable to equity holders
Revenue Reserve	13	4,183,535	4,879,443	4,617,113
Distributable reserve	12	57,664,069	57,664,069	57,664,069
Treasury Shares	11	(683,250)	(139,600)	-
Total Equity		61,164,354	62,403,912	62,281,182
Net asset value per Ordinary Share	14	1.0334	1.0428	1.0380

The accompanying notes form an integral part of these financial statements.

Statement of Comprehensive Income

For the period 1 January 2009 to 30 June 2009

	Notes	Unaudited 1 January 2009 To 30 June 2009		Unaudited 1 January 2008 To 30 June 2008
		£		£
Income	2
Bank interest		225,050		1,350,059
Commission income		39,900		72,500
Loan note interest		979,839		-
Dividend income		27,368		-
Other investment income		54,482		77,464
Net realised gains on fair value through profit or loss investments	6	-		208,274
Movement in net unrealised gain on fair value through profit or loss investments	6	(1,901,792)		3,181,456
Movement in net unrealised gains on open forward foreign currency contract	9	923,970	-	-
Foreign exchange loss		(228,568)		(5,518)
Total income		120,249		4,884,235
Expenses
Investment management fee	3	600,367		300,080
Performance fee	3	-		847,795
Administration fee	3	46,271		47,014
Custodian fee	3	9,179		9,403
Transaction expenses		49,016		104,247
Directors' fees and expenses	4	53,857		60,468
Auditor's remuneration		26,556		8,657
Legal and professional fees		15,853		91,268
Other expenses		15,058		10,498
Total expenses		816,157		1,479,430
(Loss)/profit for the period	13	(695,908)		3,404,805
(Loss)/earnings per Ordinary Share	5	(0.012)		0.057

The results from the current and prior periods are derived from continuing operations.

  

Statement of Changes in Equity

For the period 1 January 2009 to 30 June 2009

	Notes	Unaudited 1 January 2009 To 30 June 2009		Unaudited 1 January 2008 To 30 June 2008
		£		£
Balance brought forward		62,403,912		58,890,003
Issue of Ordinary Shares	11	-		-
Issue costs on issuance of Ordinary Shares	2h	-		(13,626)
Repurchase of Ordinary Shares - held as Treasury Shares	11	(543,650)		-
Transfer in from distributable reserve	11	-		13,626
		61,860,262		58,890,003
Transfer out from distributable reserve	12	-		(13,626)
(Loss)/profit for the period		(695,908)		3,404,805
Balance carried forward		61,164,354		62,281,182

Statement of Cash Flows

For the period 1 January 2009 to 30 June 2009

	Notes	Unaudited 1 January 2009 To 30 June 2009		Unaudited 1 January 2008 To 30 June 2008
		£		£
Operating activities
Commission received		39,900		72,500
Loan note interest received		610,307		-
Dividend income received		27,368		-
Other investment income		7,373		2,783
Operating expenses paid		(1,563,318)		(639,872)
Amounts paid for purchases of investments		(4,654,145)		(16,731,728)
Amounts received from sales of investments		-		408,274
Cash flows used in operating activities		(5,532,515)		(16,888,043)
Financing activities
Bank interest received		296,359		1,583,638
Repurchase of Ordinary Shares - held as Treasury Shares		(543,650)		-
Cash flows from financing activities		(247,291)		1,583,638
Net decrease in cash and cash equivalents		(5,779,806)		(15,304,405)
Cash and cash equivalents, start of period		28,526,345		55,463,259
Effect of foreign exchange rate movements		(228,568)		(5,518)
Cash and cash equivalents, end of period	8	22,517,971		40,153,336

Cash and cash equivalents comprise the following balance sheet amounts:
Bank deposits		22,517,971		40,153,336
		22,517,971		40,153,336

Notes to the Financial Statements

Period ended 30 June 2009

1. The Company:

The Company is a closed-ended investment company and was registered with limited liability in Guernsey on 12 July 2007. The Company commenced business on 2 August 2007 when the Ordinary Shares of the Company were admitted to trading on AIM.

The Company seeks to exploit the investment opportunity represented by companies in "pre-IPO" and other late stage situations with a view to arbitraging differences in public and private company valuations. Cenkos Fund Managers Limited (the "Investment Manager") believes that a large number of private companies can be successfully prepared for IPO or trade sale by investing time, financial expertise and money. In addition the Investment Manager believes that current volatility in the stock market (especially AIM) and the stricter controls being imposed on AIM applicants will reduce market appetite for smaller IPOs in the short term. To the extent that this causes companies to delay seeking a floatation, it increases the number of opportunities for the Company to offer substantial pre-IPO investment.

It is the Company's policy to invest in companies that are profitable or close to profitability. These companies will also typically have one or more of the following attributes: 

a requirement to increase the scale of its operations;

a need to replace a retiring owner-manager, or early stage investors;

a need to change strategy and invest to make it an attractive floatation or trade sale prospect;

a need to make a strategic acquisition or some other transformation to make it an attractive floatation or trade sale prospect; and/or

a decision to delay floatation because of small cap stock market volatility.

Typically, the funds invested will be used by investee companies to meet working capital requirements and to finance capital expenditure in order to make possible the expansion of the businesses either by acquisition or through organic growth. Each business in which the Company invests will, in the opinion of the Investment Manager, be capable of achieving a realisation either through a sale or by listing of its shares on a stock exchange within 6 to 36 months of an investment by the Company.

2. Principal Accounting Policies:

The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the Company's financial statements:

(a) Basis of Preparation:

The interim financial statements of the Company have been prepared in accordance with IAS 34 (as adopted by the EU) "Interim Financial Reporting".

The financial statements of the Company have been prepared under the historical cost convention modified by the revaluation of investments and assets and liabilities at fair value through profit or loss, in accordance with IFRS and The Companies (Guernsey) Law, 2008.

The preparation of financial statements in conformity with IFRS requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from such estimates.

(b) Income:

Bank interest income is classified as finance income in the Statement of Comprehensive Income and is recognised on an accruals basis at the gross amount receivable. Other investment income, commission income, dividend income and loan interest income are included in the financial statements on an accruals basis.

(c) Foreign Currency:

(i) Functional and Presentation Currency

The Company's investors are mainly from the UK, with the subscriptions and redemptions of the Ordinary Shares denominated in sterling. The primary activity of the Company is to offer UK investors with an attractive return on their investment, primarily through investing in companies which are likely to achieve an IPO or a sale within a short term time horizon and through a small number of investments in companies that are already listed. The performance of the Company is measured and reported to investors in sterling. The Directors consider sterling as the currency that most faithfully represents the economic effects of the underlying transactions, events and conditions. The financial statements are presented in sterling, which is the Company's functional and presentation currency.

(ii) Transactions and Balances

Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Statement of Comprehensive Income. Translation differences on non-monetary financial assets and liabilities such as equities at fair value through profit or loss are recognised in the Statement of Comprehensive Income. The Company holds investments denominated in Euro at the reporting date, and has entered in forward foreign currency contract to hedge the exchange rate risk arising from future cash flows on these investments. The fair value of the forward foreign currency contracts are included in amounts receivable on open forward foreign currency contracts on the Statement of Financial Position and is shown in detail in note 9 to these financial statements.

(d) Financial Instruments:

Financial assets and financial liabilities are recognised in the Statement of Financial Position when the Company becomes a party in the contractual provisions of the instrument.

(i) Financial Assets

The classification of financial assets at initial recognition depends on the purpose for which the financial asset was acquired and its characteristics.

All financial assets are initially recognised at fair value. All purchases of financial assets are recorded at trade date, being the date on which the Company became party to the contractual requirement of the financial asset. 

The Company's financial assets are categorised as financial assets at fair value through profit or loss. Unless otherwise indicated the carrying amounts of the Company's financial assets approximate to their fair values. Gains and losses arising from changes in the fair value of financial assets classified as fair value through profit or loss are recognised in the Statement of Comprehensive Income.

A financial asset (in whole or in part) is derecognised either:

(ii) Financial Liabilities

The classification of financial liabilities at initial recognition depends on the purpose for which the financial liability was issued and its characteristics.

All financial liabilities are initially recognised at fair value net of transaction costs incurred. All purchases of financial liabilities are recorded on trade date, being the date on which the Company becomes party to the contractual requirements of the financial liability. Unless otherwise indicated the carrying amounts of the Company's financial liabilities approximate to their fair values.

Financial liabilities measured at amortised cost include trade payables and other short-term monetary liabilities, which are initially recognised at fair value and subsequently carried at amortised cost using the effective interest rate method.

A financial liability (in whole or in part) is derecognised when the Company has extinguished its contractual obligations, it expires or is cancelled. Any gain or loss on derecognition is taken to the Statement of Comprehensive Income.

(e) Investments:

The Company's investments comprise of loans, equities, warrants and convertible loan notes. 

(i) Classification

Equities have been designated as fair value through profit or loss in accordance with IAS 39 (Revised) "Financial Instruments: Recognition and Measurement". 

Warrant investments meet the definition of "Derivatives" under IAS39 and have been designated as held for trading in accordance with IAS 39 (Revised) "Financial Instruments: Recognition and Measurement". They are accounted for as fair value through profit or loss.

Investments in convertible loan notes have been designated as loans and receivables in accordance with IAS 39 (Revised) "Financial Instruments: Recognition and Measurement". 

(ii) Measurement

Equities and warrants are initially recognised at fair value. Transaction costs are expensed in the Income Statement. Subsequent to initial recognition, equities and warrants are measured at fair value. Realised gains and losses on disposal of investments, where the disposal proceeds are higher/lower than the book cost of the investment are presented in the Statement of Comprehensive Income in the period in which they arise. Unrealised gains and losses arising on the fair value of investments are presented in the Statement of Comprehensive Income in the period in which they arise. Dividend income, if any, from equity investments is recognised in the Statement of Comprehensive Income within dividend income when the Company's right to receive payments is established. 

Convertible loan notes are initially recognised at fair value less any directly attributable transaction cost. Subsequent to initial recognition, loans are measured at amortised cost using the effective interest rate method. 

(iii) Fair Value Estimation

Quoted investments at fair value through profit or loss are valued at the bid price on the relevant stock exchange, discounted, where necessary, to reflect any lack of liquidity or restrictions on resale.

Unquoted investments are valued in accordance with the International Private Equity and Venture Capital valuation guidelines. 

Typically investments in unquoted companies are made by way of a package of instruments, for example a convertible loan note or outright purchase of shares which also has an attached equity interest in the form of a warrant or option of shares. In these circumstances the Directors are of the opinion that it is not possible to attribute a fair value to each of the separate components of the total investment in that company and therefore the Directors fair value the investment package as a whole.

Warrant values are calculated using the International Private Equity and Venture Capital valuation guidelines.

Loans are valued at amortised cost and reviewed for impairment in accordance with IAS39. 

(iv) Recognition/derecognition

All regular way purchases and sales of investments are recognised on trade date - the date on which the Company commits to purchase or sell the investment. Investments are derecognised when the rights to receive cash flows from the investments have expired or the Company has transferred substantially all risks and rewards of ownership.

(f) Impairment of Financial Assets:

Financial assets are assessed at each reporting date to determine whether there is any objective evidence that they are impaired. A financial asset is considered to be impaired if objective evidence indicates that one or more events have had a negative effect on the estimated future cash flows of that asset.

An impaired loss in respect of a financial asset measured at amortised cost is calculated as the difference between its carrying amount and the present value of the estimated future cash flows discounted at the original effective interest rate.

Individually significant financial assets are tested for impairment on an individual basis. The remaining financial assets are assessed collectively in groups that share similar credit risk characteristics.

(f) Impairment of Financial Assets, continued:

All impairment losses, if any, are recognised in the Statement of Comprehensive Income.

An impairment loss is reversed if the reversal can be related objectively to an event occurring after the impairment loss was recognised. The reversal is recognised in the Statement of Comprehensive Income.

(g) Placing Expenses:

Expenses incurred in the Placing of the Company charged to the Statement of Changes in Equity during the period amounted to £nil (1 January 2008 to 30 June 2008: £13,626). 

(h) Expenses:

Expenses are accounted for on an accruals basis.

(i) Cash and Cash Equivalents:

Cash and cash equivalents are defined as cash in hand, demand deposits and highly liquid investments readily convertible to known amounts of cash and subject to insignificant risk of changes in value. For the purposes of the Statement of Cash Flows, cash and cash equivalents consist of cash in hand and deposits in bank.

(j) Segmental Reporting:

The Directors are of the opinion that the Company is engaged in a single segment of business, being investment business.

(k) Treasury Shares:

Where the Company purchases its own Ordinary Share capital, the consideration paid, including any directly attributable incremental costs is deducted from equity attributable to the Company's equity holders until the shares are cancelled, reissued or disposed of. Where such shares are subsequently sold or reissued, any consideration received, net of any directly attributable incremental transaction costs, is included in equity attributable to the Company's equity holders.

3. Related Parties & Material Agreements:

The Company is responsible for the continuing fees of the Investment Manager, Administrator, Registrar and the Custodian in accordance with the Investment Management, Administration, Registrar and Custodian Agreements.

Investment Management Agreement

Pursuant to the provisions of the Investment Management Agreement, the Investment Manager is entitled to receive an advisory fee during the period at 1.0% per annum of the net asset value ("NAV") of the Company, increasing to 2.0% per annum when 50% of the net proceeds of the Placing have been invested (this threshold was reached on 23 September 2008). This fee is paid quarterly in advance based on the prior quarter end NAV, with a top up payment payable in arrears once the current quarter end NAV is finalised. As at 30 June 2009 the management fee creditor was £nil (31 December 2008: £43,819 & 30 June 2008: £nil).

The Investment Manager is also entitled to a performance fee for a relevant accounting period when the following two tests are met: 

If the adjusted closing NAV per Ordinary Share (where the adjusted NAV is the NAV of the Company excluding any liability for accrued management and performance fees and after adding back any dividends declared or paid during the performance period) exceeds the opening NAV per Ordinary Share by a hurdle rate equivalent to 7.5% per annum (the "Hurdle NAV per Ordinary Share"); and

If the adjusted closing NAV per Ordinary Share is higher than the highest previously recorded opening NAV per Ordinary Share as reduced by the sum of all dividends and distributions per Ordinary Share (including distributions of capital) since the date such highest opening NAV per Ordinary Share was established (the "High Watermark").

Once entitled to a performance fee for a relevant accounting period the fee is payable, in arrears, by reference to the amount the adjusted closing NAV per Ordinary Share exceeds either (i) the opening NAV per Ordinary Share, (where the adjusted NAV is the NAV of the Company excluding any liability for accrued performance fees and after adding back any dividends declared or paid during the performance period), or (ii) where the High Watermark exceeds the Hurdle NAV per Ordinary Share for the relevant accounting period.

The performance fee is calculated by taking an amount equal to 20% of the NAV increase per Ordinary Share in that relevant accounting period, multiplied by the time weighted average of the total number of Ordinary Shares in issue for the relevant accounting period. The first performance period began on Admission and ended on 31 December 2007. Each subsequent performance period is a period of one financial year. As at 30 June 2009 the performance fee creditor was £231,000 (31 December 2008: £923,999 & 30 June 2008: £847,795).

The Investment Manager has agreed to defer the payment of 25% of the performance fee due as at 31 December 2008 for one year. The payment of the deferred 25% of the performance fee to the Investment Manager is conditional upon the NAV of the Company being higher as at 31 December 2009 than the NAV of the Company as at 31 December 2008. 

Administration Agreement

Pursuant to the provisions of the Administration Agreement, Praxis Fund Services Limited is entitled to receive an administration fee during the period of 0.15% per annum of the net asset value of the Company, subject to an annual minimum of £60,000 applied on a quarterly basis, calculated and paid quarterly in arrears. As at 30 June 2009 the administration fee creditor was £23,131 (31 December 2008: £23,958 & 30 June 2008: £23,619).

Registrar Agreement

Pursuant to the provisions of the Registrar Agreement, Capita Registrars (Guernsey) Limited is entitled to a fee of £5,000 per annum together with a per deal fee per shareholder transaction. As at 30 June 2009 the registrar fee creditor was £2,247 (31 December 2008: £nil & 30 June 2008: £1,243).

Custodian Agreement

Pursuant to the provisions of the Custodian Agreement, Cenkos Channel Islands Limited is entitled to receive custodian fee during the period of 0.03% per annum of the net asset value of the Company, subject to an annual minimum of £15,000 applied on a quarterly basis. As at 30 June 2009 the custodian fee creditor was £4,626 (31 December 2008: £4,792 & 30 June 2008: £4,724).

Susie Farnon, a Director of the Company is also a non-executive director of the Custodian.

Directors' Interest

The interests of the Directors, who held office during the period, and their families are set out below:

	30 June 2009	31 December 2008	30 June 2008
	Ordinary Shares	Ordinary Shares	Ordinary Shares
Peter Tom	50,000	50,000	50,000
Robert Holt	50,000	50,000	50,000
Susie Farnon	*100,000	*100,000	*100,000

* 50,000 of which are held by the executors of an estate of which Susie Farnon is one of several ultimate beneficiaries. Susie Farnon is also an executor of the estate.

There were no changes in the interests of the Directors prior to the date of this report.

No Director, other than those listed above, and no connected person of any Director has any interest, the existence of which is known to, or could with reasonable diligence be ascertained by that Director, whether or not held through another party, in the share capital of the Company.

4. Directors' Fees:

Each of the Directors has entered into an agreement with the Company providing for them to act as a non-executive director of the Company. Their annual fees, pro-rate for periods less than one year, excluding all reasonable expenses incurred in the course of their duties which will be reimbursed by the Company are as follows:

	30 June 2009	31 December 2008	30 June 2008
	Annual Fee	Annual Fee	Annual Fee
	£	£	£
Peter Tom	50,000	50,000	50,000
Robert Holt	25,000	25,000	25,000
Susie Farnon	25,000	25,000	25,000

5. (Loss)/earnings per Ordinary Share:

Loss per Ordinary Share for the period ended 30 June 2009 was 1.2p (1 January 2008 to 30 June 2008: earnings of 5.7p). Loss per Ordinary Share is based on loss for the period of £695,908 (1 January 2008 to 30 June 2008: profit of £3,404,805) and on a weighted average of 59,652,139 (30 June 2008: 60,000,000) Ordinary Shares in issue.

6. Investments:

Fair Value Through Profit or Loss Investments:	1 January 2009 To 30 June 2009	1 January 2008 To 31 December 2008	1 January 2008 To 30 June 2008
	£	£	£
Investments listed on recognised investment exchanges	5,008,171	6,045,522	7,985,034
Unlisted investments	14,249,088	13,041,183	14,799,070
	19,257,259	19,086,705	22,784,104
Book cost brought forward	18,828,176	2,836,048	2,836,048
Purchases	1,001,497	16,012,128	16,731,728
Conversion of loan stock to equity	-	180,000	180,000
Sales	-	(408,274)	(408,274)
Net realised gain on fair value through profit or loss investments	-	208,274	208,274
Book cost carried forward	19,829,673	18,828,176	19,547,776
Net unrealised (loss)/gains on fair value through profit or loss investments:
Brought forward	258,529	54,872	54,872
Movement	(830,943)	203,657	3,181,456
Carried forward	(572,414)	258,529	3,236,328
Fair value carried forward	19,257,259	19,086,705	22,784,104

Loans and Receivables:	1 January 2009 To 30 June 2009	1 January 2008 To 31 December 2008	1 January 2008 To 30 June 2008
	£	£	£
Loans	18,036,174	15,454,815	-
Book cost brought forward	13,761,085	180,000	180,000
Purchases	3,652,207	13,761,085	-
Conversion of loan stock to equity	-	(180,000)	(180,000)
Book cost carried forward	17,413,292	13,761,085	-
Net unrealised foreign exchange gains on loans:
Brought forward	1,693,730	-	-
Movement	(1,070,849)	1,693,730	-
Carried forward	622,881	1,693,730	-
Fair value carried forward	18,036,173	15,454,815	-

Total Investments:	1 January 2009 To 30 June 2009	1 January 2008 To 31 December 2008	1 January 2008 To 30 June 2008
	£	£	£
Investments listed on recognised investment exchanges*	5,008,171	6,045,522	7,985,034
Unlisted investments	14,249,088	13,041,183	14,799,070
Loans	18,036,173	15,454,815	-
	37,293,432	34,541,520	22,784,104
Book cost brought forward	32,589,261	3,016,048	3,016,048
Purchases of investment	4,653,704	29,773,213	16,731,728
Sales of investments	-	(408,274)	(408,274)
Net realised gain on fair value through profit or loss investments	-	208,274	208,274
Book cost carried forward	37,242,965	32,589,261	19,547,776
Net unrealised gains on investments:
brought forward	1,952,259	54,872	54,872
Movement in net unrealised gains on fair value through profit or loss investments	(830,943)	203,657	3,181,456
Movement in net unrealised foreign exchange gains on loans investments	(1,070,849)	1,693,730	-
carried forward	50,467	1,952,259	3,236,328
Fair value carried forward	37,293,432	34,541,520	22,784,104

*representing 8.19% (31 December 2008: 9.69% & 30 June 2008: 12.82%) of Total Net Assets

One company, which the Company held an investment in as at 30 June 2009, has the ability to call an extra EUR5m of loans from the Company by way of follow-on investment.

All warrant investments, classified as "Held for Trading Investments", are held at nil cost in accordance with International Private Equity and Venture Capital valuation guidelines. 

7. Other Receivables:

	30 June 2009	31 December 2008	30 June 2008
	£	£	£
Bank interest receivable	10,758	82,067	194,269
Loan note interest receivable	875,551	506,019	77,464
Prepayments	27,382	12,664	9,571
	913,691	600,750	281,304

The Directors consider that the carrying amount of other receivables approximates fair value.

8. Cash and Cash Equivalents:

	30 June 2009	31 December 2008	30 June 2008
	£	£	£
Cash at bank	22,517,971	28,526,345	40,153,336

Of the cash and cash equivalents £5,128,684 (31 December 2008: £4,386,118 & 30 June 2008: £1,894,182) is held with Goldman Sachs money markets equivalents.

9. Forward Foreign Currency Contract:

As at 30 June 2009, the Company had the following open forward foreign currency contract (31 December 2008 & 30 June 2008: none):

Purchase Currency	Contractual Amount	Sale Currency	Contractual Amount	Maturity Date	Fair Value
					£
GBP	13,716,000	EUR	15,000,000	1/4/2010	923,970

10. Other Payables:

	30 June 2009	31 December 2008	30 June 2008
	£	£	£
Management fee	3,064	43,819	-
Performance fee	231,000	923,999	847,795
Fees received in advance	183,576	230,686	-
Administration fee	23,131	23,958	23,619
Custodian fee	4,626	4,792	4,724
Brokers fees and commissions	6,233	-	-
Due to broker	-	441	-
Legal and professional	-	-	2,050
NOMAD fee	6,147	6,250	-
Audit fee	17,436	24,000	8,080
Directors' fees	6,250	-	25,000
Registrar's fee	2,247	-	1,243
Other payables	1,000	6,758	25,051
	484,710	1,264,703	937,562

The Directors consider that the carrying amount of other payables approximates fair value.

11. Share Capital: 

	30 June 2009 31 December 2008  &  30 June 2008
Authorised Share Capital	£
Unlimited  Shares of no par value that may be issued as Ordinary Shares	-
	-

	1 January 2009 To 30 June 2009	1 January 2008 To 31 December 2008	1 January 2008 To 30 June 2008
Allotted, issued and fully paid	£	£	£
Issue costs on issuance of Ordinary Shares	-	(13,626)	(13,626)
Transfer from/(to) distributable reserve	-	13,626	13,626
	-	-	-

On 18 July 2007 the holders of the Subscriber Shares, Praxis Nominees Limited and Praxis Fund Services Limited, passed a written resolution approving the cancellation of the entire amount which stood to the credit of the share premium account immediately after the Placing, conditionally upon the issue of the Ordinary Shares and the payment in full thereof and with respect to any further issue of Ordinary Shares. The cancellation was confirmed by the Royal Court on 23 November 2007. 

By a resolution dated 14 July 2009 the holders of the Subscriber Shares in the Company granted the Company the authority to make market purchases of up to 14.99% of its own issued Ordinary Shares following the conclusion of the Placing. This authority will expire at the earlier of the 31 December 2010 or the conclusion of the next annual general meeting of the Company. A renewal of the authority to make purchases of Ordinary Shares will be sought from Shareholders at each annual general meeting of the Company. As at 30 June 2009 the Company held 810,000 (31 December 2008: 155,000 & 30 June 2008: nil) of its own Ordinary Shares in treasury with 59,845,000 Ordinary Shares remaining in the market (31 December 2008: 59,845,000 & 30 June 2008: 60,000,000).

	30 June 2009	31 December 2008	30 June 2008
Treasury Shares	£	£	£
810,000 Treasury Shares (31 December 2008: 155,000 & 30 June 2008: nil)	683,250	139,600	-
	683,250	139,600	-

12. Distributable reserve:

	1 January 2009 To 30 June 2009	1 January 2008 To 31 December 2008	1 January 2008 To 30 June 2008
	£	£	£
Distributable reserve brought forward	57,664,069	57,677,695	57,677,695
Transfer from distributable reserve during the period/year	-	(13,626)	(13,626)
Distributable reserve carried forward	57,664,069	57,664,069	57,664,069

13. Revenue reserve:

	1 January 2009 To 30 June 2009	1 January 2008 To 31 December 2008	1 January 2008 To 30 June 2008
	£	£	£
Retained revenue reserve brought forward	4,879,443	1,212,308	1,212,308
(Loss)/profit for the period/year	(695,908)	3,667,135	3,404,805
Retained revenue reserve carried forward	4,183,535	4,879,443	4,617,113

14. Net Asset Value per Ordinary Share:

The net asset value per Ordinary Share as at 30 June 2009 is 103.34p (31 December 2008: 104.28p & 30 June 2008: 103.80p). The net asset value per Ordinary Share is based on the net assets attributable to equity ordinary shareholders of £61,164,354 (31 December 2008: £62,403,912 & 30 June 2008: £62,281,182) and on the period/year end number of Ordinary Shares in issue of 59,190,000 (31 December 2008: 59,845,000 & 30 June 2008: 60,000,000).

15. Financial Instruments:

(a) Significant accounting policies:

Details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis on which income and expenses are recognised, in respect of its financial assets, including convertible loan notes, and financial liabilities are disclosed in note 2 to these financial statements.

(b) Categories of financial instruments:

Financial instruments comprise equities, warrants and convertible loan notes. The warrants are derivative instruments and have been classified as held for trading and are accounted for as fair value through profit or loss. All other financial instruments have been classified as fair value through profit or loss. As at 30 June 2009, the fair value of the Company's financial instruments was £37,293,432 (31 December 2008: £34,541,520 & 30 June 2008: £22,784,104). This was 60.97% (31 December 2008: 55.35% & 30 June 2008: 36.58%) of net assets attributable to equity shareholders.

At 30 June 2009:	Fair Value	Percentage of net assets attributable to holders of Ordinary Shares
Assets	£	%
Financial assets at fair value through profit or loss:
Listed equity securities	5,008,171	8.19
Unlisted equity securities	14,249,087	23.30
	19,257,258	31.49
Loans and receivables*:
Loans	18,036,173	29.49
Cash and cash equivalents	22,517,971	36.82
	59,811,402	97.80

At 31 December 2008:	Fair Value	Percentage of net assets attributable to holders of Ordinary Shares
Assets	£	%
Financial assets at fair value through profit or loss:
Listed equity securities	6,045,522	9.69
Unlisted equity securities	13,041,183	20.90
	19,086,705	30.59
Loans and receivables*:
Loans	15,454,815	24.77
Cash and cash equivalents	28,526,345	45.71
	63,067,865	101.06

At 30 June 2008:	Fair Value	Percentage of net assets attributable to holders of Ordinary Shares
Assets	£	%
Financial assets at fair value through profit or loss:
Listed equity securities	7,985,034	12.82
Unlisted equity securities	14,799,070	23.76
	22,784,104	36.58
Cash and cash equivalents	40,153,336	64.47
	62,937,440	101.05

* Amortised cost is not considered to be materially different from fair value

There are no financial liabilities.

(c) Net gains and losses on financial assets:

Period ended 30 June 2009	Movement in net unrealised gains	Net realised gains on disposals
	£	£
Financial assets at fair value through profit or loss:
Listed equity securities	(1,772,253)	-
Unlisted equity securities	941,410	-
	(830,843)	-
Loans and receivables:
Loans	(1,070,849)	-
	(1,901,692)	-

  

Year ended 31 December 2008:	Movement in net unrealised gains	Net realised gains on disposals
	£	£
Financial assets at fair value through profit or loss:
Listed equity securities	(2,361,740)	208,274
Unlisted equity securities	2,565,397	-
	203,657	208,274
Loans and receivables:
Loans	1,693,730	-
	1,897,387	208,274

Period ended 30 June 2008	Movement in net unrealised gains	Net realised gains on disposals
	£	£
Financial assets at fair value through profit or loss:
Unlisted equity securities	3,181,456	208,274

(d) Derivatives:

In accordance with the Company's scheme particulars the Company may invest in derivatives or forward foreign exchange contracts/swaps for the purpose of efficient portfolio management. 

Warrants

The following table details the Company's investments in warrant derivative contracts, by maturity, outstanding as at 30 June 2009 (31 December 2008: 3 derivatives instruments held & 30 June 2008: 3 derivatives instruments held).

	30 June 2009		31 December 2008		30 June 2008
Maturity	No. Held	Fair Value	No. Held	Fair Value	No. Held	Fair Value
						£
< 1 year	3	-	1	-	-	-
1-2 years	-	-	2	-	3	-
Total	3	-	3	-	3	-

A warrant is a derivative financial instrument which gives the right, but not the obligation to buy a specific amount of a given stock, at a specified price (strike price) on a specific date. The fair value of the warrants are classified as financial assets at fair value through profit or loss, as disclosed in note (b) above. The warrants for underlying unlisted equities are valued in accordance with the International Private Equity and Venture Capital valuation guidelines.

Forward foreign currency swaps

As at 30 June 2009, the Company had the outstanding forward foreign currency contract as detailed in note 9 to these financial statements.

In accordance with the Company's scheme particulars the Company may invest in forward foreign exchange contracts for the purpose of efficient portfolio management. As there is no assurance that these hedges will be effective in achieving offsetting changes in the cash flows attributable to the currency risk on these specific foreign currency payments it is the policy of the Company not to apply hedge accounting.

16. Financial Risk Management:

Strategy in Using Financial Instruments:

The Company's activities expose it to a variety of financial risks: market risk (including currency risk, fair value interest rate risk, cash flow interest rate risk and price risk), credit risk and liquidity risk. The Company's overall risk management program focuses on the unpredictability of financial markets and seeks to minimise potential adverse effects on the Company's financial performance.

The Company will seek to exploit the investment opportunity represented by companies in "pre-IPO" and other late stage situations with a view to arbitraging differences in public and private company valuations. The Investment Manager believes that a large number of private companies can be successfully prepared for IPO or trade sale by investing time, financial expertise and money. In addition the Investment Manager believes that current volatility in the stock market (especially AIM) and the stricter controls being imposed on AIM applicants will reduce market appetite for smaller IPOs in the short term. To the extent that this causes companies to delay seeking a flotation, it increases the number of opportunities for the Company to offer substantial pre-IPO investment.

Market Price Risk

Market price risk results mainly from the uncertainty about future prices of financial instruments held. It represents the potential loss the Company may suffer through holding market positions in the face of price movements and changes in interest rates or foreign exchange rates, with the maximum risk resulting from financial instruments being determined by the fair value of the financial instruments. 

All securities investments present a risk of loss of capital. The Investment Adviser moderates this risk through a careful selection of securities and other financial instruments within specified limits. The maximum risk resulting from financial instruments is determined by the fair value of the financial instruments. The Company's portfolio and investment strategy is reviewed continuously by the Investment Adviser and the Investment Manager and on a quarterly basis by the Board.

The Company's exposure to market price risk arises from uncertainties about future prices of its investments. This risk is managed through diversification of the investment portfolio. It is the Company's intention to build a portfolio of investments which is diversified by both sector and stage of development. Generally the Company will seek not to invest (or commit to invest) more than 15% of the Company's net assets in any single investment at the time of investment (or commitment), or more than 15% of the Company's net assets in special situations (such as investments in companies already listed) at the time of investment (or commitment), although such limit may be increased to 30% in certain cases where the Board deems appropriate on the advice of the Investment Manager. 

At 30 June 2009, the Company's market risk is affected by three main components: changes in actual market prices, interest rate and foreign currency movements. The impact of interest rate and foreign currency movements are shown below. A 25% increase in the value of investments, with all other variables held constant, would bring about a 15.24% (31 December 2008: 13.84% & 30 June 2008: 9.15%) increase in net assets attributable to equity shareholders. If the value of investments had been 25% lower, with all other variables held constant, net assets attributable to equity shareholders would have fallen by 15.24% (31 December 2008: 13.84% & 30 June 2008: 9.15%). Whilst these sensitivity percentages show the Company's overall sensitivity to price movements, it does not reflect the leveraged nature of the derivative financial instruments held by the Company. Warrants by their nature will be disproportionately sensitive to changes in the value of the underlying equity instrument and therefore a 25% increase/decrease in the value of the equity instrument could result in a significantly greater than 25% increase/decrease in the value of the respective derivative instrument.

Interest Rate Risk:

The Company is exposed to risks associated with the effects of fluctuations in the prevailing levels of market interest rates on its financial instruments and future cash flows. The Company is exposed to interest rate risk as it's cash and cash equivalents are invested at short term rates. The Investment Manager manages the Company's exposure to interest rate risk daily in accordance with the Company's investment objectives and policies. The Company's overall exposure to interest rate risk is monitored on a quarterly basis by the Board of Directors.

  The table below summarises the Company's exposure to interest rate risks.

	30 June 2009		31 December 2008		30 June 2008
	WAEIR*	Total	WAEIR*	Total	WAEIR*	Total
		£		£		£
Assets
Fixed interest rate unquoted debt securities	11.41%	18,036,173	11.78%	15,454,815	10.00%	3,740,000
Cash at bank	0.70%	22,517,971	3.07%	28,526,345	6.29%	40,153,336
Non-interest bearing	-	21,094,919	-	19,687,455	-	19,325,408
Total assets		61,649,063		63,668,615		63,218,744
Liabilities
Non-interest bearing	-	484,710	-	1,264,703	-	937,562
Total liabilities		484,710		1,264,703		937,562

* - weighted average effective interest rate

The sensitivity analyses below have been determined based on the Company's exposure to interest rates for interest bearing assets and liabilities (included in the interest rate exposure table above) at the Balance Sheet date and the stipulated change taking place at the beginning of the financial period and held constant through the reporting period in the case of instruments that have floating rates.

A 200 basis point increase or decrease is used when reporting interest rate risk internally to key management personnel and represents management's assessment of the possible change in interest rates.

If interest rates had been 200 basis points higher and all other variables were held constant, the Company's increase in net assets attributable to equity holders for the period ended 30 June 2009 would have been an increase of £223,329 (year ended 31 December 2008: £570,527 & period ended 30 June 2008: £398,233) due to the increase in the interest earned on the Company's cash balances.

If interest rates had been 200 basis points lower and all other variables were held constant, the Company's increase in net assets attributable to equity holders for the period ended 30 June 2009 would have been a decrease of £78,165 (year ended 31 December 2008: £570,527 & period ended 30 June 2008: £398,233) due to the decrease in the interest earned on the Company's cash balances.

The Company's sensitivity to interest rates has decreased during the current year/period as the Company has invested its capital into its investments thereby reducing its cash balances that are interest bearing. 

Foreign Currency Risk:

Foreign currency risk is the risk that the fair value of future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates.

The Company's assets may be invested in securities and other investments that are denominated in currencies different to the reporting currency. Accordingly, the value of an investment may be affected favourably or unfavourably by fluctuations in exchange rates. The Company may through forward foreign exchange contracts hedge its exposure back to sterling but has not done so during the financial year/period.

Currency Exposure:

A proportion of the net assets of the Company are denominated in currencies other than sterling. The carrying amounts of these assets and liabilities are as follows:

	Assets		Liabilities
	30 June 2009		30 June 2009
	£		£
Australia Dollar	1,225,010		-
British Pound	45,830,319		301,134
Euro	14,593,735		183,576
Equity attributable to Ordinary Shareholders	61,649,064		484,710

	Assets		Liabilities
	31 December 2008		31 December 2008
	£		£
Australia Dollar	1,201,519		-
British Pound	43,037,249		1,078,271
Euro	19,429,847		186,432
Equity attributable to Ordinary Shareholders	63,668,615		1,264,703

	Assets		Liabilities
	30 June 2008		30 June 2008
	£		£
Australia Dollar	3,007,121		-
British Pound	57,518,307		937,562
Euro	2,693,316		-
Equity attributable to Ordinary Shareholders	63,218,744		937,562

The Company is exposed to Australian Dollar and Euro (31 December 2008 & 30 June 2008: Australian Dollar and Euro).

The sensitivity analysis below has been determined based on the sensitivity of the Company's outstanding foreign currency denominated financial assets and liabilities to a 20% increase/decrease in the sterling against Australian Dollar and Euro, translated at the balance sheet date.

The following details the Company's sensitivity to a 20% increase/decrease in foreign currency rates. 20% is the sensitivity rate used when reporting foreign currency risk internally to key management personnel and represents management's assessment of the possible change in foreign exchange rates.

As at 30 June 2009 if sterling had weakened by 20% against the Australian Dollar and Euro, with all other variables held constant, the increase in net assets attributable to Ordinary Shares would have been 5.17% (31 December 2008: 6.61% & 30 June 2008: 1.84%) lower. Conversely, if sterling had strengthened by 20% against the Australian Dollar and Euro, with all other variables held constant, the increase in net assets attributable to Ordinary Shares would have been 5.17% (31 December 2008: 6.61% & 30 June 2008: 1.84%) higher.

Credit and Liquidity Risk:

Credit risk is the risk that an issuer or counterparty will be unable or unwilling to meet a commitment that it has entered into with the Company.

Liquidity risk is the risk that the Company will encounter in realising assets or otherwise raising funds to meet financial commitments. 

It is the aim of the Company to invest in companies which are likely to achieve a listing or realisation within six to thirty-six months.

Maturity Analysis:

The table below shows the maturity analysis of the Company's assets and liabilities as at 30 June 2009:

At 30 June 2009	Less than 1 month	1-12 months	1-3 years	3-5 years	5-10 years	No fixed maturity	Total
	£	£	£	£		£	£
Assets
Fixed interest rate unquoted debt securities*	-	800,000	4,895,000	8,504,529	3,836,644	-	18,036,173
Cash at bank	19,789,190	2,728,781	-	-	-	-	22,517,971
Non-interest bearing	22,175	1,460,623	327,481	-	-	19,284,641	21,094,920
Total assets	19,811,365	4,989,404	5,222,481	8,504,529	3,836,644	19,284,641	61,649,064
Liabilities
Non-interest bearing	-	-	-	-	-	484,710	484,710
Total liabilities	-	-	-	-	-	484,710	484,710

At 31 December 2008	Less than 1 month	1-12 months	1-3 years	3-5 years	No fixed maturity	Total
	£	£	£	£	£	£
Assets
Fixed interest rate unquoted debt securities*	-	755,000	9,857,962	4,841,853	-	15,454,815
Cash at bank	14,278,560	14,247,785	-	-	-	28,526,345
Non-interest bearing	352,855	235,232	-	-	19,099,368	19,687,455
Total assets	14,631,415	15,238,017	9,857,962	4,841,853	19,099,368	63,668,615
Liabilities
Non-interest bearing	-	-	-	-	1,264,703	1,264,703
Total liabilities	-	-	-	-	1,264,703	1,264,703

At 30 June 2008	Less than 1 month	1-12 months	1-3 years	3-5 years	No fixed maturity	Total
	£	£	£	£	£	£
Assets
Fixed interest rate unquoted debt securities*	-	-	-	-	3,740,000	3,740,000
Cash at bank	19,132,097	21,021,239	-	-	-	40,153,336
Non-interest bearing	130,203	64,066	-	-	19,131,139	19,325,408
Total assets	19,262,300	21,085,305	-	-	22,871,139	63,218,744
Liabilities
Non-interest bearing	-	-	-	-	937,562	937,562
Total liabilities	-	-	-	-	937,562	937,562

*Although the convertible loan note has an indicated redemption date written into the loan agreements, this redemption date is based on the planned event date. The actual event date is not known, therefore for maturity analysis purposes the convertible loan has been categorised as "No fixed maturity".

Concentration Risk

Concentration risk may arise if the Company's investments are concentrated in a low number of investments each representing a relatively large percentage of the Company's net assets. While the Investment Manager will attempt to spread the Company's assets among a number of investments in accordance with the investment policies adopted by the Company, at times the Company may hold a relatively small number of investments each representing a relatively large portion of the Company's net assets. Losses incurred in such investments could have a materially adverse effect on the Company's overall financial condition. Whilst the Company's portfolio is diversified in terms of the companies in which it invests, the investment portfolio of the Company may be subject to more rapid change in value than would be the case if the Company were required to maintain a wider diversification among types of securities, countries and industry groups. 

16. Dividend:

The Directors do not recommend the payment of a dividend for the period ended 30 June 2009 (period ended 30 June 2008: £nil).

17. Taxation:

The Income Tax Authority of Guernsey has granted the Company exemption from Guernsey income tax under the Income Tax (Exempt Bodies) (Guernsey) Ordinance, 1989 and the income of the Company may be distributed or accumulated without deduction of Guernsey income tax. Exemption under the above mentioned Ordinance entails payment by the Company of an annual fee of £600 each. It should be noted, however, that interest and dividend income accruing from the Company's investments may be subject to withholding tax in the country of origin. With effect from 1 January 2008 the standard rate of income tax for most companies in Guernsey is zero per cent. Tax Exempt status continues to exist and the Company has been granted this status for 2009.

The Company has not suffered any withholding tax during the period (period ended 30 June 2008: £nil).

18. Capital Management:

The Directors may exercise the powers of the Company to borrow money and to give security over its assets. The Company may borrow funds secured on its investments if the Board (with the advice of Cenkos Fund Manager Limited) considers that satisfactory opportunities for investment arise at a time when the Company is close to being fully invested. In any event, borrowing will be limited to 25 per cent. of the Company's last announced NAV at the time of draw down. The Company may also be indirectly exposed to the effects of gearing to the extent that investee companies have outstanding borrowings.

19. Post Period End Events:

On 2 July 2009, the Company purchased 1.15 million of our own shares at a price of 83p each. Also since the period the period end the Company has made one follow on investment of circa £550,000.

There are no other significant post period end events that require disclosure in these financial statements.

Copies of the interim report will be sent to shareholders shortly and will be available for a period of one month to the public at the offices of Cenkos Fund Managers Limited at 6.7.8 Tokenhouse Yard, London, EC2R 7AS and will be available at the Company's website www.rapidrealisations.com.

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ENDIR SFISALSUSEEU

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Related Shares:

RRF.L