28th Nov 2008 13:31
The directors of TP70 VCT plc are pleased to announce its Interim Results for the 6 months ended 30 September 2008.
For further information, please contact :
David Dick 020 7201 8989 or Graham Urquhart 020 3216 2000
Financial summary
|
£'000 |
|
|
Net assets |
27,671 |
|
Net loss before tax |
(2,041) |
|
Loss per share |
(6.37p) |
|
Net asset value per share |
86.41p |
Chairman's statement
I am pleased to be writing to you to present the unaudited interim results for TP70 VCT plc ("the Company") for the six months to 30 September 2008.
The Company's investment strategy is to offer combined exposure to GAM's fund of hedge funds - GAM Diversity and VCT-qualifying investments focused on companies with contractual revenues from financially secure counterparties.
100% of the Company's funds are currently exposed to GAM Diversity, of which 70% will be invested in suitable VCT-qualifying investments as they become available by the end of the third year, in order to satisfy the requirements for VCT tax status with up to 30% of net asset value remaining exposed to GAM Diversity
Results
The past six months has seen turmoil in the financial markets. Although GAM Diversity has outperformed relevant benchmarks such as the FTSE and the MSCI World Index in the period, the value of the Company's exposure to GAM Diversity has fallen contributing to an overall loss for the 6 months of £2,041,000 representing a change of -6.9%..
.
Risks and Uncertainties
The Board confirms that the principal risks facing the company over the remainder of the financial period are:
(a) investment risk associated with investing in small and immature businesses
(b) failure to secure approval as a VCT.
(c) exposure tor GAM Diversity
(d) the possibility that the redemption period for GAM Diversity will be extended.
The Board believe these principal risks are manageable and to expected for a company with TP70's strategy. The Board continues to work closely with the Investment Manager to endeavour to minimise either their likelihood or potential impact.
A more detailed explanation of the risks faced by the Company can be found in note 20 on page 29 of the Annual Financial Statements for the period ended 31 March 2008.
COCNLUSION
The financial markets have experienced unprecedented difficulties and the Company has not been unaffected. However, the Board is confident that the Company's combination of returns from tax reliefs and investment performance will deliver positive returns to shareholders over the longer term.
If you have any queries or comments, please do not hesitate to telephone Triple Point Investment Management LLP on 020 7201 8989 or email me at [email protected].
Michael Sherry
Chairman
28 November 2008
TP70 VCT plc
Interim Financial Report
for the 6 months ended 30 September 2008
Investment manager's report
GAM Diversity was selected as an investment for the Company because of its long track record of equity-like returns with considerable downside protection. Diversity has delivered on this expectation outperforming both the FTSE and MSCI World Index in the reporting period, and since exposure was first gained in 2007.
However, as shareholders will be aware, recent months have marked a bleak period in the financial markets. During the six months ended 30 September 2008, the FTSE fell 13.46% and the MSCI World Index 6.74%. In this period GAM Diversity fell 5.94%.
During the period, GAM has moved Diversity to a more defensive portfolio of hedge funds. Diversity now has a lower proportion of equity long/short funds and a higher proportion of trading funds that GAM believes are best placed to exploit current market volatility.
The second asset class selected for investment by the Company are the Triple Point VCT-qualifying investments. The Company requires at least 70% of its funds to be invested in VCT-qualifying investments by the end of its third year in order to retain its VCT status.
Following the period end, instructions have been given to liquidate 13% of the exposure to Diversity in order to commence funding these investments. Triple Point is confident that the Company will meet its target of VCT-qualifying investments and so ensure shareholders retain the valuable tax reliefs offered by the Company.
David Dick
for
Triple Point Investment Management LLP
28 November 2008
TP70 VCT plc
Interim Financial Report
for the 6 months ended 30 September 2008
Investment portfolio review
|
Security |
Cost |
Valuation |
||
|
£'000 |
% |
£'000 |
% |
|
|
Qualifying holdings |
- |
- |
- |
- |
|
Non-qualifying holdings |
29,758 |
99.67 |
29,038 |
99.66 |
|
Uninvested funds |
98 |
0.33 |
98 |
0.34 |
|
|
|
|
|
|
|
29,856 |
100.00 |
29,136 |
100.00 |
|
|
|
||||
|
Non Qualifying Holdings |
||||
|
Quoted |
||||
|
GAM Diversity Hedge Fund |
4,165 |
14.00 |
3,867 |
13.32 |
|
Barclays Bond Portfolio |
||||
|
Walmart 4.75 29 Jan 2013 |
1,552 |
5.22 |
1,597 |
5.50 |
|
NY Life Global Fdg 4.5 17 Jan 2013 MTN Rg |
1,522 |
5.11 |
1,506 |
5.18 |
|
MG Fund 4.625 18 Jan 2013 MTN |
1,530 |
5.14 |
1,507 |
5.19 |
|
Rabobk 4.625 31 May 2012 |
1,550 |
5.21 |
1,543 |
5.31 |
|
AIG Sun 5.125 28 Jan 2013 MTN |
1,569 |
5.27 |
1,172 |
4.03 |
|
Nedgem 4.375 14 Dec 2012 MTN |
1,529 |
5.14 |
1,597 |
5.50 |
|
Eib 4.5 14 Jan 2013 |
1,538 |
5.16 |
1,626 |
5.60 |
|
Eib 4.75 06 Jun 2012 |
1,563 |
5.25 |
1,587 |
5.46 |
|
Kfw 4.875 15 Jan 2013 MTN |
1,567 |
5.27 |
1,611 |
5.55 |
|
Kfw Int Fin 4.75 07 Dec 2012 MTN |
1,559 |
5.24 |
1,617 |
5.57 |
|
Kommbk 4.875 10 Dec 2012 MTN |
1,568 |
5.27 |
1,622 |
5.59 |
|
Massmutual G 6.125 14 May 2013 MTN |
1,652 |
5.55 |
1,640 |
5.65 |
|
Total 5.5 29 Jan 2013 |
1,608 |
5.40 |
1,654 |
5.70 |
|
GE 6.125 17 May 2012 MTN |
1,645 |
5.53 |
1,460 |
5.03 |
|
E.ON 6.375 29 May 2012 |
1,654 |
5.56 |
1,640 |
5.65 |
|
RBOS 10.5 01 Mar 2013 |
1,987 |
6.68 |
1,792 |
6.17 |
|
|
|
|
|
|
|
29,758 |
100.00 |
29,038 |
100.00 |
|
|
|
|
|||
TP70 VCT plc
Interim Financial Report
for the 6 months ended 30 September 2008
Directors' Responsibility Statement
The Directors have chosen to prepare the interim financial report for the company in accordance with International Financial Reporting Standards ("IFRS").
In preparing the summarised financial statements for the 11 month period to 30 September 2008, the Directors confirm that to the best of their knowledge:
a) the summarised set of financial statements have been prepared in accordance with international accounting standard IAS34,"Interim Financial Reporting" issued by the International Accounting Standards board;
b) the interim report includes a fair review of important events during the period and their effect on the financial statements and a description of principal risks and uncertainties for the remainder of the accounting period;
c) the summarised set of financial statements give a true and fair view in accordance with IFRS of the assets, liabilities, financial position and of the results of the company for the period and comply with IFRS and the Companies Acts 1985 and 2006; and
d) the interim report includes a fair review of related party transactions and changes therein. Other than detailed in note 18 there are no related party transactions.
This Interim Financial Report has not been audited or reviewed by the auditor.
Michael Sherry
Chairman
28 November 2008
TP70 VCT plc
consolidated income statement
for the 6 months ended 30 September 2008
|
6 months ended |
Period Ended |
Period Ended |
||||||||||
|
Note |
30 September 2008 |
30 September 2007 |
31 March 2008 |
|||||||||
|
Rev. |
Cap. |
Total |
Rev. |
Cap. |
Total |
Rev. |
Cap. |
Total |
||||
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
||||
|
Investment income |
702 |
- |
702 |
676 |
- |
676 |
1,382 |
- |
1,382 |
|||
|
Realised gain on investments |
10 |
- |
4 |
4 |
- |
- |
- |
- |
- |
- |
||
|
Unrealised gain / (loss) on investments |
10 |
- |
(1,094) |
(1,094) |
- |
(61) |
(61) |
- |
370 |
370 |
||
|
Derivative transaction |
15 |
(708) |
(634) |
(1,342) |
(553) |
78 |
(475) |
(1,266) |
(991) |
(2,257) |
||
|
Investment return |
(6) |
(1,724) |
(1,730) |
123 |
17 |
140 |
116 |
(621) |
(505) |
|||
|
Investment management fees |
6 |
62 |
185 |
247 |
72 |
217 |
289 |
140 |
421 |
561 |
||
|
Financial and regulatory costs |
4 |
- |
4 |
7 |
- |
7 |
26 |
- |
26 |
|||
|
General administration |
26 |
- |
26 |
15 |
- |
15 |
20 |
- |
20 |
|||
|
Legal and professional fees |
13 |
- |
13 |
11 |
- |
11 |
28 |
- |
28 |
|||
|
Directors' remuneration |
7 |
21 |
- |
21 |
28 |
- |
28 |
51 |
- |
51 |
||
|
Operating expenses |
126 |
185 |
311 |
133 |
217 |
350 |
265 |
421 |
686 |
|||
|
Loss on ordinary activities before taxation |
(132) |
(1,909) |
(2,041) |
(10) |
(200) |
(210) |
(149) |
(1,042) |
(1,191) |
|||
|
Taxation on ordinary activities |
8 |
- |
- |
- |
- |
- |
- |
- |
- |
- |
||
|
Loss on ordinary activities after taxation |
(132) |
(1,909) |
(2,041) |
(10) |
(200) |
(210) |
(149) |
(1,042) |
(1,191) |
|||
|
Basic & diluted loss per share |
9 |
(0.41p) |
(5.96p) |
(6.37p) |
(0.03p) |
(0.68p) |
(0.71p) |
(0.48p) |
(3.38p) |
(3.86p) |
||
The loss per share shown above is both basic and diluted as there are no potentially dilutive financial instruments in issue.
The total column of this statement is the company's income statement prepared in accordance with International Financial Reporting Standards ("IFRS"). The supplementary revenue return and capital return columns have been prepared under guidance published by the Association of Investment Companies.
The accompanying notes on pages 9 to 12 form an integral part of this interim financial report.
.
TP70 VCT plc
Consolidated statement of changes in equity
for the 6 months ended 30 September 2008
|
Issued Capital |
Share Premium |
Capital Reserve |
Revenue Reserve |
Total |
||
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
||
|
|
||||||
|
6 months ended 30 September 2008 |
||||||
|
Balance at 1 April 2008 |
320 |
30,596 |
(1,042) |
(149) |
29,725 |
|
|
Loss for the period |
- |
- |
(2,041) |
(2,041) |
||
|
Transfer to capital reserve |
(1,909) |
1,909 |
- |
|||
|
Purchase of own shares |
- |
- |
- |
(13) |
(13) |
|
|
Balance at 30 September 2008 |
320 |
30,596 |
(2,951) |
(294) |
27,671 |
|
|
|
|
|
|
|||
|
Period ended 30 September 2007 |
||||||
|
Loss for the period |
- |
- |
- |
(210) |
(210) |
|
|
Transfer to capital reserve |
(200) |
200 |
- |
|||
|
Issue of share capital |
320 |
31,717 |
- |
- |
32,037 |
|
|
Share issue costs |
- |
(1,121) |
- |
- |
(1,121) |
|
|
Balance at 30 September 2007 |
320 |
30,596 |
(200) |
(10) |
30,706 |
|
|
Period ended 31 March 2008 |
||||||
|
Loss for the period |
- |
- |
- |
(1,191) |
(1,191) |
|
|
Transfer to capital reserve |
(1,042) |
1,042 |
- |
|||
|
Issue of share capital |
320 |
31,717 |
- |
- |
32,037 |
|
|
Share issue costs |
- |
(1,121) |
- |
- |
(1,121) |
|
|
Balance at 31 March 2008 |
320 |
30,596 |
(1,042) |
(149) |
29,725 |
|
The accompanying notes on pages 9 to12 form an integral part of this interim financial report.
.
TP70 VCT plc
Consolidated balance sheet
as at 30 September 2008
|
|
30-Sep-08 |
30-Sep-07 |
31-Mar-08 |
|||||
|
Note |
£'000 |
£'000 |
£'000 |
|||||
|
Non Current Assets |
||||||||
|
Financial assets at fair value through profit and loss |
10 |
29,038 |
29,997 |
30,428 |
||||
|
Current assets: |
||||||||
|
Other receivables |
796 |
787 |
578 |
|||||
|
Cash and cash equivalents |
11 |
98 |
382 |
74 |
||||
|
|
|
|
||||||
|
894 |
1,169 |
652 |
||||||
|
TOTAL ASSETS |
29,932 |
31,166 |
31,080 |
|||||
|
Current Liabilities |
||||||||
|
Trade and other payables |
112 |
456 |
182 |
|||||
|
Amount payable under derivative transaction |
15 |
2,021 |
1,173 |
|||||
|
Current taxation payable |
8 |
- |
- |
- |
||||
|
Accrued expenses |
128 |
4 |
- |
|||||
|
2,261 |
460 |
1,355 |
||||||
|
NET ASSETS |
27,671 |
30,706 |
29,725 |
|||||
|
EQUITY |
||||||||
|
Equity attributable to equity holders of the parent |
||||||||
|
Share capital |
12 |
320 |
320 |
320 |
||||
|
Share premium |
30,596 |
30,596 |
30,596 |
|||||
|
Capital reserve |
(2,951) |
(200) |
(1,042) |
|||||
|
Revenue reserve |
(294) |
(10) |
(149) |
|||||
|
Total equity |
27,671 |
30,706 |
29,725 |
|||||
|
|
|
|
||||||
|
Net asset value per share (pence) |
14 |
86.41p |
95.84p |
92.78p |
||||
The accompanying notes on pages 9 to 12 form an integral part of this interim financial report.
TP70 VCT plc
Consolidated cash flow statement
for the 6 months ended 30 September 2008
|
6 months ended |
Period ended |
Period ended |
||||||
|
30-Sep-08 |
30-Sep-07 |
31-Mar-08 |
||||||
|
£'000 |
£'000 |
£'000 |
||||||
|
Cash flows from operating activities |
||||||||
|
Loss before taxation |
(2,041) |
(210) |
(1,191) |
|||||
|
Realised gain on investments |
(4) |
- |
- |
|||||
|
Unrealised (gain) / loss on investments |
1,094 |
61 |
(370) |
|||||
|
Cash absorbed by operations |
(951) |
(149) |
(1,561) |
|||||
|
Increase in other receivables |
(218) |
(787) |
(578) |
|||||
|
Increase in current liabilities |
906 |
460 |
1,355 |
|||||
|
Net cash outflow from operating activities |
(263) |
(476) |
(784) |
|||||
|
Cash flow from investing activities |
||||||||
|
Purchase of financial assets at fair value through profit and loss account |
- |
(30,058) |
(30,058) |
|||||
|
Sales of financial assets at fair value through profit and loss account |
300 |
|||||||
|
Net cash flows from investing activities |
300 |
(30,058) |
(30,058) |
|||||
|
Cash flows from financing activities |
||||||||
|
Proceeds from issue of share capital |
- |
32,037 |
32,037 |
|||||
|
Share issue expenses |
- |
(1,121) |
(1,121) |
|||||
|
Buy back of own shares |
(13) |
|||||||
|
Net cash flows from financing activities |
(13) |
30,916 |
30,916 |
|||||
|
Net increase in cash and cash equivalents |
24 |
382 |
74 |
|||||
|
Reconciliation of net cash flow to movements in cash and cash equivalents |
||||||||
|
Cash and cash equivalents at 1 April 2008 |
74 |
- |
- |
|||||
|
Net increase in cash and cash equivalents |
24 |
382 |
74 |
|||||
|
Cash and cash equivalents at 30 September 2008 |
98 |
382 |
74 |
|||||
The accompanying notes on pages 9 to 12 form an integral part of this interim financial report..
TP70 VCT plc
Notes to the summarised set of financial statements
for the 6 months ended 30 September 2008
1 Corporate Information
The interim condensed financial statements of the company for the 6 months ended 30 September 2008 were authorised for issue in accordance with a resolution of the directors on 28 November 2008.
The company was admitted for listing on the London Stock Exchange on 21 March 2007.
TP70 VCT Plc is the Group's ultimate parent company. It is incorporated and domiciled in Great Britain. The address of TP70 VCT plc's registered office, which is also its principal place of business, is 4-5 Grosvenor Place, London, SW1X 7HJ.
TP70 VCT plc's consolidated interim financial statements are presented in Pounds Sterling (£) which is also the functional currency of the parent company.
The financial information set out in this interim report does not constitute statutory accounts as defined in Section 240 of the Companies Act 1985.
The principal activity of the company is investment. The company's investment strategy is to offer combined exposure to GAM Diversity Inc (GAM's fund of hedge funds) and venture capital investments focused on companies with contractual revenues from financially secure counterparties.
2 Basis of preparation and accounting policies
Basis of preparation
The interim condensed consolidated financial statements of the Group for the 6 months ended 30 September 2008 have been prepared in accordance with IAS 34: Interim Financial Reporting. They do not include all of the information required for full financial statements and should be read in conjunction with the consolidated financial statements of the Group for the period from 27 November 2006 to 31 March 2008.
The accounting policies applied by the Group in the condensed consolidated financial statements are the same as those applied by the Group in its financial statements for the period from 27 November 2006 to 31 March 2008
3 Estimates
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates.
In preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation and uncertainty were the same as those that applied to the consolidated financial statements as at and for the period ended 31 March 2008.
4 Seasonality of operations
The company's operations are not seasonal.
TP70 VCT plc
Notes to the summarised set of financial statements
for the 6 months ended 30 September 2008
5 Segmental reporting
The Company currently has only one class of business, investment activity, and its only geographical segment is Europe.
6 Investment management fees
Triple Point Investment Management LLP provides investment management and administration services to the Company under an Investment Management Agreement effective 5 April 2007 which runs for a period of 5 years and may be terminated at any time thereafter by not less than twelve months' notice given by either party and which provides for an administration and investment management fee of 1.75% per annum of net assets calculated and payable quarterly in arrears.
7 Directors' remuneration
|
6 months ended |
Period ended |
Period ended |
||||||
|
30-Sep-08 |
30-Sep-07 |
31-Mar-08 |
||||||
|
£'000 |
£'000 |
£'000 |
||||||
|
M G Sherry (Chairman) |
6 |
9 |
16 |
|||||
|
J C Murrin |
8 |
10 |
19 |
|||||
|
I D Parsons |
7 |
9 |
16 |
|||||
|
Total |
21 |
28 |
51 |
|||||
8 Taxation on ordinary activities
|
6 months ended |
Period ended |
Period ended |
||||||
|
30-Sep-08 |
30-Sep-07 |
31-Mar-08 |
||||||
|
£'000 |
£'000 |
£'000 |
||||||
|
Loss on ordinary activities before tax |
(2,041) |
(210) |
(1,191) |
|||||
|
Capital Losses not taxable |
1,724 |
(17) |
621 |
|||||
|
Unused tax losses |
(317) |
(227) |
(570) |
|||||
|
Add unused tax losses brought forward from previous years |
(570) |
- |
- |
|||||
|
Unused tax losses carried forward |
(887) |
(227) |
(570) |
|||||
|
UK corporation tax |
- |
- |
- |
|||||
Capital gains and losses are exempt from corporation tax due to the company's status as a Venture Capital Trust.
No provision has been made for a deferred tax asset in the balance sheet.
TP70 VCT plc
Notes to the summarised set of financial statements
for the 6 months ended 30 September 2008
9 Loss per share
The loss per share is based on a loss from ordinary activities after tax of £2.041,000, and on the weighted average number of shares in issue during the year of 32,023,295.
10 Financial assets at fair value through profit or loss
|
30-Sep-08 |
30-Sep-07 |
31-Mar-08 |
||||||
|
£'000 |
£'000 |
£'000 |
||||||
|
Quoted Investments |
||||||||
|
Balance at 1 April 2008 |
30,428 |
- |
- |
|||||
|
Purchases at cost |
- |
30,058 |
30,058 |
|||||
|
Sales Proceeds |
(300) |
- |
- |
|||||
|
Realised gain on disposal |
4 |
- |
- |
|||||
|
Unrealised gain / (loss) on revaluation |
(1,094) |
(61) |
370 |
|||||
|
|
|
|
||||||
|
Valuation as at 30 September 2008 |
29,038 |
29,997 |
30,428 |
|||||
|
Cost as at 30 September 2008 |
29,758 |
30,058 |
30,058 |
|||||
|
Unrealised loss at 30 September 2008 |
(720) |
(61) |
370 |
|||||
Further details of these investments are provided in the Investment portfolio review.
11 Cash and cash equivalents
Cash and cash equivalents comprise deposits with HSBC Bank plc.
12 Share Capital
|
30-Sep-08 |
30-Sep-07 |
31-Mar-08 |
||||||
|
£'000 |
£'000 |
£'000 |
||||||
|
Ordinary Shares of 1p |
||||||||
|
Authorised |
||||||||
|
Number of shares |
50,000,000 |
50,000,000 |
50,000,000 |
|||||
|
Par Value £'000 |
500 |
500 |
500 |
|||||
|
Issued & Fully Paid |
||||||||
|
Number of shares |
32,022,471 |
32,037,546 |
32,037,546 |
|||||
|
Par Value £'000 |
320 |
320 |
320 |
|||||
During the period the company purchased and cancelled 15,075 of its own shares.
TP70 VCT plc
Notes to the summarised set of financial statements
for the 6 months ended 30 September 2008
13 Subsidiary
At 30 September 2008 the Company had the following subsidiary company:
|
Class of share capital |
Country of Incorporation |
Cost of Investment |
Proportion of shares held by the parent company |
|
|
£ |
% |
|||
|
Starshell Limited |
Ordinary |
Cyprus |
4,181,357 |
100 |
14 Net asset value per share
The calculation of net asset value per share is based on net assets of £27,671,000 divided by the 32,022,471 shares in issue.
15 Derivative transaction
Under the terms of the derivative transaction, the return on the company's portfolio of bonds, managed by Barclays Capital, has been swapped for that on an equivalent investment in GAM Diversity Inc. The element of the swap that relates to revenue is included in the revenue column of the income statement and the element that relates to capital is included in the capital column. The liability under the derivative transaction, net of interest received on the bond portfolio and paid over to Barclays Capital, is included in current liabilities.
16 Commitments and contingencies
The company has no outstanding commitments or contingent liabilities.
17 Contingencies
The directors of the Company are currently seeking clarification as to the incidence of the economic risks and rewards of its bond portfolio. The directors believe that the position will be resolved satisfactorily. If not, the effect at 30 September 2008 would have been a mark-to-market loss of no more than £422,000.
18. Related party transactions
Michael Sherry, Chairman of the Company, is an equity Member of Triple Point LLP (TPLLP). TPLLP in turn has a controlling interest in Triple Point Investment Management LLP (TPIMLLP). During the period, TPIMLLP received £246,911 (2007: £289,456) for providing management and administrative services to the Company.
18 Post balance sheet events
There have been no significant post balance sheet events.
TP70 VCT plc
General Information
Directors
Michael Gabriel Sherry
James Chadwick Murrin
Ian David Parsons
Secretary and Registered Office
Peter William Hargreaves
4-5 Grosvenor Place
London, SW1X 7HJ
Company Registered Number
6010401
Solicitors
Howard Kennedy
19 Cavendish Square
London, W1A 2AW
Bankers
HSBC Bank plc
PO Box 648
27-32 Poultry
London, EC2P 2BX
Investment Manager and Administrator
Triple Point Investment Management LLP
4-5 Grosvenor Place
London, SW1X 7HJ
VCT Tax Advisor
PricewaterhouseCoopers
1 Embankment Place
London, WC2N 6RH
Independent Auditor
Grant Thornton UK LLP
1 Westminster Way
Oxford, OX2 0PZ
Registrars
Neville Registrars Limited
Neville House
18 Laurel Lane
Halesowen
West Midlands, B63 3DA
Related Shares:
Triple Point Ve